In the nature of a substitute.

TEXT OF AMENDMENTS

SA 1436. Mrs. MURRAY submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 159, between lines 11 and 12, insert the following:

SEC. 5____. AUTHORIZATION OF APPROPRIATIONS FOR REGIONAL
FIELD VERIFICATION PROGRAM.

There is authorized to be appropriated to carry out the
regional field verification program of the Department of
Energy $4,000,000 for each of fiscal years 2004 through 2007.
______

SA 1437. Mr. AKAKA submitted an amendment intended to be proposed by
him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the appropriate place, insert the following:

SEC. 9____. DEPARTMENT OF ENERGY GLOBAL CHANGE SCIENCE
RESEARCH.

(a) In General.--The Secretary, acting through the Director
of Science, shall conduct a comprehensive research program to
understand the global climate system and to investigate and
analyze the effects of energy production and use on that
system.
(b) Program Elements.--The program under subsection (a)
shall include the following elements:
(1) Research and modeling activities on the radiation
balance from the surface of the Earth to the top of the
atmosphere, including the effects of aerosols and clouds.
(2) Research and modeling activities to investigate and
understand the global carbon cycle, including the role of the
terrestrial biosphere as a source or sink for carbon dioxide,
and to develop, test, and improve carbon-cycle models.
(3) Research activities to understand the scales of
response of complex ecosystems to environmental changes,
including identifying the underlying causal mechanisms and
pathways and how they are linked, and research and modeling
activities on the response of terrestrial ecosystems to
changes in climate, atmospheric composition, and land use.
(4) Research and modeling activities to develop integrated
assessments of the economic, social, and environmental
implications of climate change and policies related to
climate change, with emphasis on improving the resolution of
models for integrated assessments on a regional basis
(including States and territories of the United States in the
Pacific, on the Gulf of Mexico, or in agricultural or
forested areas of the continental United States), developing
and improving models for technology innovation and diffusion,
and developing and improving models of the economic costs and
benefits of climate change and policies related to climate
change.
(5) Development of high-end computational resources,
information technologies, and data assimilation methods to
carry out the program under subsection (a), to make more
effective use of large and distributed data sets and
observational data streams, and to increase the availability
and utility of climate change and energy simulations to
researchers and policy makers.
(c) Education and Information Dissemination.--
(1) In general.--The Secretary shall include education and
training of undergraduate and graduate students as an
integral part of the program under subsection (a), in
collaboration with similar programs in other Federal
agencies.
(2) Carbon dioxide information and analysis center.--The
Secretary shall support a

[[Page S10694]]

Carbon Dioxide Information and Analysis Center to serve as a
resource to researchers and others interested in global
climate change and to accommodate data and information
requests related to the greenhouse effect and global climate
change.
(d) Authorization of Appropriations.--
(1) In general.--There are authorized to be appropriated to
carry out this section--
(A) $150,000,000 for fiscal year 2004;
(B) $175,000,000 for fiscal year 2005;
(C) $200,000,000 for fiscal year 2006;
(D) $230,000,000 for fiscal year 2007; and
(E) $266,000,000 for fiscal year 2008.
(2) Availability of funds.--Amounts made available under
paragraph (1) shall remain available until expended.
(3) Limitation on funds.--Amounts made available under
paragraph (1) shall not be used for the development,
demonstration, or deployment of technology to reduce, avoid,
or sequester greenhouse gas emissions.
______

SA 1438. Mr. DAYTON (for himself and Mr. Bond) submitted an amendment
intended to be proposed by him to the bill S. 14, to enhance the energy
security of the United States, and for other purposes; which was
ordered to lie on the table; as follows:

At the appropriate place, insert the following:

Subtitle E--Bioenergy Program

SEC. 541. BIOENERGY PROGRAM.

Section 9010 of the Farm Security and Rural Investment Act
of 2002 (7 U.S.C. 8108) is amended--
(1) in subsection (b)(3), by adding at the end the
following:
``(C) Base biodiesel production gross payable units.--The
quantity of base biodiesel production gross payable units
under the program for an eligible producer shall be
determined by--
``(i) dividing--

``(I) the base production; by
``(II) the biodiesel conversion factor of 1.4; and

``(ii) multiplying the result by--

``(I) in the case of the first year of participation by the
eligible producer in the program, 0.5;
``(II) in the case of the second year of participation by
the eligible producer in the program, 0.3;
``(III) in the case of the third year of participation by
the eligible producer in the program, 0.15; and
``(IV) in the case of the fourth and subsequent year of
participation by the eligible producer in the program, 0.'';
and

(2) in subsection (c)(1), by striking ``not more than''.
______

SA 1439. Mr. WYDEN (for himself, Mr. Brownback, and Mr. Craig)
submitted an amendment intended to be proposed by him to the bill S.
14, to enhance the energy security of the United States, and for other
purposes; which was ordered to lie on the table; as follows:

At the appropriate place, insert the following:

TITLE ____--SOIL AND FOREST CARBON SEQUESTRATION PROGRAM

SEC. ____01. DEFINITIONS.

In this title:
(1) Advisory panel.--The term ``Advisory Panel'' means the
Soil and Forestry Carbon Sequestration Panel established
under section ____05.
(2) Eligible forest carbon activity.--The term ``eligible
forest carbon activity'' means a forest management action
that--
(A)(i) helps restore forest land that has been
underproducing or understocked for more than 5 years; or
(ii) maintains natural forest under a permanent
conservation easement;
(B) provides for protection of a forest from nonforest use;
(C) allows a variety of sustainable management
alternatives;
(D) maintains or improves a watershed or fish and wildlife
habitat; or
(E) demonstrates permanence of carbon sequestration and
promotes and sustains native species.
(3) Forest carbon reservoir.--The term ``forest carbon
reservoir'' means carbon that is stored in aboveground or
underground soil and other biomass that are associated with a
forest ecosystem.
(4) Forest carbon sequestration program.--The term ``forest
carbon sequestration program'' means the program established
under section ____02.
(5) Forest land.--
(A) In general.--The term ``forest land'' means a parcel of
land that is, or has been, at least 10 percent stocked by
forest trees of any size.
(B) Inclusions.--The term ``forest land'' includes--
(i) land on which forest cover may be naturally or
artificially regenerated; and
(ii) a transition zone between a forested area and
nonforested area that is capable of sustaining forest cover.
(6) Forest management action.--
(A) In general.--The term ``forest management action''
means an action that--
(i) applies forestry principles to the regeneration,
management, use or conservation of forests to meet specific
goals and objectives;
(ii) demonstrates permanence of carbon sequestration and
promotes and sustains native species; and
(iii) maintains the ecological sustainability and
productivity of the forests or protects natural forests under
a permanent conservation easement.
(B) Inclusions.--The term ``forest management action''
includes management and use of forest land for the benefit of
aesthetics, fish, recreation, urban values, water,
wilderness, wildlife, wood products, or other forest values.
(7) Reforestation.--
(A) In general.--The term ``reforestation'' means the
reestablishment of forest cover naturally or artificially.
(B) Inclusions.--The term ``reforestation'' includes
planned replanting, reseeding, and natural regeneration.
(8) Secretary.--The term ``Secretary'' means the Secretary
of Agriculture.
(9) Soil carbon sequestration program.--The term ``soil
carbon sequestration program'' means the program established
under section ____03.
(10) State.--The term ``State'' includes a political
subdivision of a State.
(11) Willing owner.--The term ``willing owner'' means a
State or local government, Indian tribe, private entity, or
other person or non-Federal organization that owns forest
land and is willing to participate in the forest carbon
sequestration program.

SEC. ____02. FOREST CARBON SEQUESTRATION PROGRAM.

(a) In General.--The Secretary, acting through the Chief of
the Forest Service and in collaboration with State foresters,
State resource management agencies, and interested
nongovernmental organizations, shall establish a forest
carbon sequestration program under which the Secretary,
directly or through agreements with 1 or more States, may
enter into cooperative agreements with willing owners of
forest land to carry out forest management actions or
eligible forest carbon activities on not more than a total of
5,000 acres of forest land holdings to create or maintain a
forest carbon reservoir.
(b) Assistance to States.--
(1) In general.--The Secretary shall provide assistance to
States for the purpose of entering into cooperative
agreements with willing owners of forest land to carry out
eligible forest carbon activities on forest land.
(2) Reporting.--As a condition of receiving assistance
under paragraph (1), a State shall annually submit to the
Secretary a report disclosing the estimated quantity of
carbon stored through the cooperative agreement.
(c) Bonneville Power Administration.--Each of the States of
Washington, Oregon, Idaho, and Montana may apply for funding
from the Bonneville Power Administration for purposes of
funding a cooperative agreement that meets the fish and
wildlife objectives and priorities of the Bonneville Power
Administration under the Pacific Northwest Electric Power
Planning and Conservation Act (16 U.S.C. 839 et seq.), but
only to the extent the cooperative agreement also meets the
objectives of this section.

SEC. ____03. SOIL CARBON SEQUESTRATION PROGRAM.

(a) Establishment.--
(1) In general.--The Secretary, acting through the Natural
Resources Conservation Service and in cooperation with the
Consortium for Agricultural Soils Mitigation of Greenhouse
Gases, shall carry out 4 or more pilot programs to--
(A) develop, demonstrate, and verify the best management
practices for enhanced soil carbon sequestration on
agricultural land; and
(B) evaluate and establish standardized monitoring and
verification methods and protocols.
(2) Criteria.--The Secretary shall select a pilot program
based on--
(A) the merit of the proposed program; and
(B) the diversity of soil types, climate zones, crop types,
cropping patterns, and sequestration practices available at
the site of the proposed program.
(b) Requirements.--A pilot program carried out under this
section shall--
(1) involve agricultural producers in--
(A) the development and verification of best management
practices for carbon sequestration; and
(B) the development and evaluation of carbon monitoring and
verification methods and protocols on agricultural land;
(2) involve research and testing of the best management
practices and monitoring and verification methods and
protocols in various soil types and climate zones;
(3) analyze the effects of the adoption of the best
management practices on--
(A) greenhouse gas emissions, water quality, and other
aspects of the environment at the watershed level; and
(B) the full range of greenhouse gases; and
(4) use the results of the research conducted under the
program to--
(A)(i) develop best management practices for use by
agricultural producers;
(ii) provide a comparison of the costs and net greenhouse
effects of the best management practices; and
(iii) encourage agricultural producers to adopt the best
management practices; and
(B) develop best management practices on a regional basis
for use in watersheds and States not participating in the
pilot programs.

SEC. ____04. SOIL AND FORESTRY CARBON SEQUESTRATION PANEL.

(a) Establishment.--The Secretary (acting through the Chief
of the Forest Service and the Natural Resources Conservation
Service) and the Secretary of Energy (acting through

[[Page S10695]]

the Administrator of the Energy Information Administration)
shall establish a Soil and forestry Carbon Sequestration
Panel for the purposes of--
(1) advising the Secretary and the Secretary of Energy in
the development and updating of guidelines for accurate
voluntary reporting of greenhouse gas sequestration from
forest management actions and agricultural best management
practices;
(2) evaluating the potential effectiveness (including cost
effectiveness) of the guidelines, in verifying carbon inputs
and outputs and assessing impacts on other greenhouse gases
from various forest management strategies and agricultural
best management practices;
(3) estimating the effect of proposed implementation of the
guidelines on--
(A) carbon sequestration and storage; and
(B) the net emissions of other greenhouse gases;
(4) providing estimates on the rates of carbon
sequestration and net nitrous oxide and methane impacts for
forests and various plants, agricultural commodities, and
agricultural practices for the purpose of assisting the
Secretary in determining the acceptability of the cooperative
agreement offers made by willing owners;
(5) proposing to the Secretary and the Secretary of Energy
standardized methods for--
(A) measuring carbon sequestered in soils and in forests;
and
(B) estimating the impacts of the forest carbon
sequestration program and the soil carbon sequestration
program on other greenhouse gases; and
(6) assisting the Secretary and the Secretary of Energy in
reporting to Congress on the results of the forest carbon
sequestration program and the soil carbon sequestration
program.
(b) Membership.--The Advisory Panel shall be composed of
the following members with interest and expertise in soil
carbon sequestration and forestry management, appointed
jointly by the Secretary and the Secretary of Energy:
(1) 1 member representing national professional forestry
organizations.
(2) 1 member representing national agriculture
organizations.
(3) 2 members representing environmental or conservation
organizations.
(4) 1 member representing Indian tribes.
(5) 3 members representing the academic scientific
community.
(6) 2 members representing State forestry organizations.
(7) 2 members representing State agricultural
organizations.
(8) 1 member representing the Environmental Protection
Agency.
(9) 1 member representing the Department of Agriculture.
(c) Terms.--
(1) In general.--Except as provided in paragraph (2) a
member of the Advisory Panel shall be appointed for a term of
3 years.
(2) Initial terms.--Of the members first appointed to the
Advisory Panel--
(A) 1 member appointed under each paragraphs (2), (4), (6),
and (8) shall serve an initial term of 1 year; and
(B) 1 member appointed under each of paragraphs (1), (3),
(5), (7), and (9) shall serve an initial term of 2 years.
(3) Vacancies.--
(A) In general.--A vacancy on the Advisory Panel shall be
filled in the manner in which the original appointment was
made.
(B) Partial term.--A member appointed to fill a vacancy
occurring before the expiration of the term shall be
appointed only for the remainder of the term.
(C) Successive terms.--An individual may not be appointed
to serve on the Advisory Panel for more than 2 full
consecutive terms.
(d) Existing Councils.--The Secretary and the Secretary of
Energy may use an existing council to perform the tasks of
the Advisory Panel if--
(1) representation on the council, the terms and background
of members of the council, and the responsibilities of the
council reflect those of the Advisory Panel; and
(2) those responsibilities are a priority for the council.

SEC. ____05. STANDARDIZATION OF CARBON SEQUESTRATION
MEASUREMENT PROTOCOLS.

(a) Accurate Monitoring, Measurement, and Reporting.--
(1) In general.--The Secretary and the Secretary of Energy,
in collaboration with the States, shall--
(A) develop standardized measurement protocols for--
(i) carbon sequestered in soils and trees; and
(ii) impacts on other greenhouse gases;
(B)(i) develop standardized forms to monitor sequestration
improvements made as a result of the forest carbon
sequestration program and the soil carbon sequestration
program; and
(ii) distribute the forms to participants in the forest
carbon sequestration program and the soil carbon
sequestration program; and
(C) at least once every 5 years, submit to the Committee on
Agriculture, Nutrition, and Forestry and the Committee on
Energy and Natural Resources of the Senate and the Committee
on Agriculture and the Committee on Resources of the House of
Representatives a report on the forest carbon sequestration
program and the soil carbon sequestration program.
(2) Contents of report.--A report under paragraph (1)(C)
shall describe--
(A) carbon sequestration improvements made as a result of
the forest carbon sequestration program and the soil carbon
sequestration program;
(B) carbon sequestration practices on land owned by
participants in the forest carbon sequestration program and
the soil carbon sequestration program; and
(C) the degree of compliance with any cooperative
agreements, contracts, or other arrangements entered into
under this title.
(b) Educational Outreach.--The Secretary, acting through
the Cooperative State Research, Education, and Extension
Service, and in consultation with the Consortium for
Agricultural Soils Mitigation of Greenhouse Gases, shall
conduct an educational outreach program to collect and
disseminate to owners and operators of agricultural and
forest land research-based information on agriculture and
forest management practices that will increase the
sequestration of carbon, without threat to the social and
economic well-being of communities.
(c) Periodic Review.--At least once every 2 years, the
Secretary and the Secretary of Energy shall--
(1) convene the Advisory Panel to evaluate the latest
scientific and observational information on reporting,
monitoring, and verification of carbon storage from forest
management and soil sequestration actions; and
(2) issue revised recommendations for reporting,
monitoring, and verification of carbon storage from forest
management actions and agricultural best management practices
as necessary.

SEC. ____06. AUTHORIZATION OF APPROPRIATION.

There are authorized to be appropriated such sums as are
necessary to carry out this title.
______

SA 1440. Mr. WYDEN (for himself, Mr. Smith, and Mrs. Feinstein)
submitted an amendment intended to be proposed by him to the bill S.
14, to enhance the energy security of the United States, and for other
purposes; which was ordered to lie on the table; as follows:

At the end, add the following:

TITLE ____ --MISCELLANEOUS

SEC. ____. OFFICE OF CONSUMER ADVOCACY.

(a) Definitions.--In this section:
(1) Commission.--The term ``Commission'' means the Federal
Energy Regulatory Commission.
(2) Energy customer.--The term ``energy customer'' means a
residential customer or a small commercial customer that
receives products or services from a public utility or
natural gas company under the jurisdiction of the Commission.
(3) Natural gas company.--The term ``natural gas company''
has the meaning given the term in section 2 of the Natural
Gas Act (15 U.S.C. 717a), as modified by section 601(a) of
the Natural Gas Policy Act of 1978 (15 U.S.C. 3431(a)).
(4) Office.--The term ``Office'' means the Office of
Consumer Advocacy established by subsection (b)(1).
(5) Public utility.--The term ``public utility'' has the
meaning given the term in section 201(e) of the Federal Power
Act (16 U.S.C. 824(e)).
(6) Small commercial customer.--The term ``small commercial
customer'' means a commercial customer that has a peak demand
of not more than 1,000 kilowatts per hour.
(b) Office.--
(1) Establishment.--There is established within the
Department of Energy the Office of Consumer Advocacy.
(2) Director.--The Office shall be headed by a Director to
be appointed by the President, by and with the advice and
consent of the Senate.
(3) Duties.--The Office may represent the interests of
energy customers on matters concerning rates or service of
public utilities and natural gas companies under the
jurisdiction of the Commission--
(A) at hearings of the Commission;
(B) in civil actions brought in connection with any
function carried out by the Commission, except as provided in
section 518 of title 28, United States Code; and
(C) at hearings or proceedings of other Federal regulatory
agencies and commissions.
______

SA 1441. Mr. KENNEDY submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end, add the following:

TITLE ____--UNEMPLOYMENT COMPENSATION

SEC. ____. ADDITIONAL WEEKS OF TEMPORARY EXTENDED
UNEMPLOYMENT COMPENSATION FOR EXHAUSTEES.

(a) Additional Weeks.--Section 203 of the Temporary
Extended Unemployment Compensation Act of 2002 (Public Law
107-147; 116 Stat. 28) is amended by adding at the end the
following:
``(d) Increased Amounts in Account for Certain
Exhaustees.--
``(1) In general.--In the case of an eligible exhaustee,
this Act shall be applied as follows:
``(A) Subsection (b)(1)(A) shall be applied by substituting
`100 percent' for `50 percent'.
``(B) Subsection (b)(1)(B) shall be applied by substituting
`26 times' for `13 times'.

[[Page S10696]]

``(C) Subsection (c)(1) shall be applied by substituting `7
times the individual's average weekly benefit amount for the
benefit year' for `the amount originally established in such
account (as determined under subsection (b)(1))'.
``(D) Section 208(b) shall be applied--
``(i) in paragraph (1), as if ``, including such
compensation payable by reason of amounts deposited in such
account after such date pursuant to the application of
subsection (c) of such section'' were inserted before the
period at the end;
``(ii) as if paragraph (2) had not been enacted; and
``(iii) in paragraph (3), by substituting ``the date that
is 21 weeks after the date of enactment of Energy Policy Act
of 2003'' for ``March 31, 2004''.
``(2) Eligible exhaustee defined.--For purposes of this
subsection, the term `eligible exhaustee' means an
individual--
``(A) to whom any temporary extended unemployment
compensation was payable for any week beginning before the
date of enactment of this subsection; and
``(B) who exhausted such individual's rights to such
compensation (by reason of the payment of all amounts in such
individual's temporary extended unemployment compensation
account, including amounts deposited in such account by
reason of subsection (c)) before such date of enactment.''.
(b) Effective Date and Application.--
(1) In general.--The amendment made by subsection (a) shall
apply with respect to weeks of unemployment beginning on or
after the date of enactment this Act.
(2) TEUC-X amounts deposited in account prior to date of
enactment deemed to be the additional teuc amounts provided
by this section.--In applying the amendment made by
subsection (a) under the Temporary Extended Unemployment
Compensation Act of 2002 (Public Law 107-147; 116 Stat. 26),
the Secretary of Labor shall deem any amounts deposited into
an eligible exhaustee's (as defined in section 203(d)(2) of
the Temporary Extended Unemployment Compensation Act of 2002,
as added by subsection (a)) temporary extended unemployment
compensation account by reason of section 203(c) of such Act
(commonly known as ``TEUC-X amounts'') prior to the date of
enactment of this Act to be amounts deposited in such account
by reason of section 203(b) of such Act, as amended by
subsection (a) (commonly known as ``TEUC amounts'').
(3) Redetermination of eligibility for augmented amounts
for all eligible exhaustees.--The determination of whether
the eligible exhaustee's (as so defined) State was in an
extended benefit period under section 203(c) of such Act that
was made prior to the date of enactment of this Act shall be
disregarded and the determination under such section, as
amended by subsection (a) with respect to eligible exhaustees
(as so defined), shall be made as follows:
(A) Eligible exhaustees who received and exhausted teuc-x
amounts.--In the case of an eligible exhaustee whose
temporary extended unemployment account was augmented under
such section 203(c) before the date of enactment of this Act,
the determination shall be made as of such date of enactment.
(B) Eligible exhaustees who exhausted teuc amounts but were
not eligible for teuc-x amounts.--In the case of an eligible
exhaustee whose temporary extended unemployment account was
not augmented under such section 203(c) as of the date of
enactment of this Act, the determination shall be made at the
time that the individual's account established under section
203 of the Temporary Extended Unemployment Compensation Act
of 2002 (Public Law 107-147; 116 Stat. 28), as amended by
subsection (a), is exhausted.

SEC. ____. TEMPORARY AVAILABILITY OF EXTENDED UNEMPLOYMENT
BENEFITS UNDER THE RAILROAD UNEMPLOYMENT
INSURANCE ACT FOR EMPLOYEES WITH LESS THAN 10
YEARS OF SERVICE.

Section 2(c)(2) of the Railroad Unemployment Insurance Act
(45 U.S.C. 352(c)(2)) is amended by adding at the end the
following:
``(D) Temporary availability of extended unemployment
benefits for employees with less than 10 years of service.--
``(i) In general.--Subject to clause (ii), in the case of
an employee who has less than 10 years of service (as so
defined), with respect to extended unemployment benefits,
this paragraph shall apply to such an employee in the same
manner as this paragraph applies to an employee who has 10 or
more years of service (as so defined).
``(ii) Application.--Clause (i) shall apply to--

``(I) an employee who received normal benefits for days of
unemployment under this Act during the period beginning on
July 1, 2002, and ending on December 31, 2003; and
``(II) days of unemployment beginning on or after the date
of enactment of the this subparagraph.''.

______

SA 1442. Mr. SANTORUM submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of title VII of division B, add the following:

SEC. ________. CERTAIN STEAM GENERATORS OR OTHER GENERATING
BOILERS USED IN NUCLEAR FACILITIES AND CERTAIN
REACTOR VESSEL HEADS USED IN SUCH FACILITIES.

(a) In General.--
(1) Subheading 9902.84.02 of the Harmonized Tariff Schedule
of the United States is amended by striking ``12/31/2006''
and inserting ``12/31/2012''.
(2) Subchapter II of chapter 99 of the Harmonized Tariff
Schedule of the United States is amended by inserting in
numerical sequence the following new heading:

``      9902.84.03       Reactor vessel       Free          No change       No change       On or before 12/
heads for nuclear                                                  31/2012          ''
reactors (provided                                                                   .
for in subheading
8401.40.00).

(b) Effective Date.--The amendments made by subsection
(a)(2) shall apply to goods entered, or withdrawn from
warehouse, for consumption on or after January 1, 2005.
______

SA 1443. Mr. VOINOVICH submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 150, between liens 14 and 15, insert the following:

SEC. 44____. FERNALD URANIUM PROCESSING FACILITY OF THE
DEPARTMENT OF ENERGY.

(a) Definitions.--In this section:
(1) Byproduct material.--The term ``byproduct material''
has the meaning given the term in section 11e.(2) of the
Atomic Energy Act of 1954 (42 U.S.C. 2014(e)(2)).
(2) Commission.--The term ``Commission'' means the Nuclear
Regulatory Commission.
(3) Secretary.--The term ``Secretary'' means the Secretary
of Energy.
(b) Fernald Facility Material.--Notwithstanding any other
provision of law, the material contained in concrete silos at
the Fernald uranium processing facility managed, as of the
date of enactment of this Act, by the Department of Energy,
shall be considered to be byproduct material.
(c) Disposal.--With respect to the material described in
subsection (b)--
(1) the Secretary may dispose of the material in a facility
under the jurisdiction of the Commission or a State; and
(2) on disposal of the material in a facility under
paragraph (1), the material shall be regulated by the
Commission or the State with jurisdiction over the facility.
(d) Jurisdiction and Applicable Authority.--Material
described in subsection (b)--
(1) shall remain subject to the jurisdiction of the
Secretary until such time as the material is received at a
commercial disposal facility that is licensed by the
Commission or a State; and
(2) after being received at a facility described in
paragraph (1), shall be subject to the health and safety
requirements of the Commission or State, as the case may be,
with jurisdiction over the facility.
______

SA 1444. Mr. LEVIN submitted an amendment intended to be proposed to
amendment SA 1432 proposed by Mr. Frist to the bill S. 14, to enhance
the energy security of the United States, and for other purposes; which
was ordered to lie on the table; as follows:

At the end of title VII add the following:

Subtitle D--Advanced Clean Vehicle Demonstration Program

SEC. 741. DEFINITIONS.

In this subtitle:
(1) Alternative fueled vehicle.--The term ``alternative
fueled vehicle'' means a vehicle propelled solely on an
alternative fuel as defined in section 301 of the Energy
Policy Act of 1992 (42 U.S.C. 13211), except the term does
not include any vehicle that the Secretary determines, by
rule, does not yield substantial environmental benefits over
a vehicle operating solely on gasoline or diesel derived from
fossil fuels.
(2) Fuel cell vehicle.--The term ``fuel cell vehicle''
means a vehicle propelled by an electric motor powered by a
fuel cell system that converts chemical energy into
electricity by combining oxygen (from air) with hydrogen fuel
that is stored on the vehicle or is produced onboard by
reformation of a hydrocarbon fuel. Such a fuel cell system
may, but is not required to, include the use of auxiliary
energy storage systems to enhance vehicle performance.
(3) Hybrid vehicle.--The term ``hybrid vehicle'' means--
(A) a motor vehicle that draws propulsion energy from
onboard sources of stored energy that are both--
(i) an internal combustion or heat engine using combustible
fuel; and

[[Page S10697]]

(ii) a rechargeable energy storage system; and
(B) any other vehicle that is defined as a hybrid vehicle
in regulations prescribed by the Secretary of Energy for the
administration of title III of the Energy Policy Act of 1992.
(4) Neighborhood electric vehicle.--The term ``neighborhood
electric vehicle'' means a motor vehicle capable of traveling
at speeds of 25 miles per hour that is--
(A) a low-speed vehicle, as such term is defined in section
571.3(b) of title 49, Code of Federal Regulations;
(B) a zero-emission vehicle, as such term is defined in
section 86.1702-99 of title 40, Code of Federal Regulations;
and
(C) otherwise lawful to use on local streets.
(5) Pilot program.--The term ``pilot program'' means the
competitive grant program established under section 742.
(6) State.--The term ``State'' includes the District of
Columbia and the Commonwealth of Puerto Rico.
(7) Ultra-low sulfur diesel vehicle.--The term ``ultra-low
sulfur diesel vehicle'' means a vehicle manufactured in model
year 2002, 2003, 2004, 2005, or 2006 powered by a heavy-duty
diesel engine that--
(A) is fueled by diesel fuel which contains sulfur at not
more than 15 parts per million; and
(B) emits not more than the lesser of--
(i) for vehicles manufactured in--

(I) model years 2002 and 2003, 3.0 grams per brake
horsepower-hour of oxides of nitrogen and .01 grams per brake
horsepower-hour of particulate matter; and
(II) model years 2004 through 2006, 2.5 grams per brake
horsepower-hour of nonmethane hydrocarbons and oxides of
nitrogen and .01 grams per brake horsepower-hour of
particulate matter; or

(ii) the emissions of nonmethane hydrocarbons, oxides of
nitrogen, and particulate matter of the best performing
technology of ultra-low sulfur diesel vehicles of the same
class and application that are commercially available.

SEC. 742. GRANT PILOT PROGRAM.

(a) Requirement for Program.--The Secretary of Energy shall
establish a competitive grant pilot program to provide
project grants to eligible recipients to carry out a project
or projects for the purposes described in subsection (c).
(b) Eligible Recipients.--The following entities are
eligible to receive a grant under the pilot program:
(1) A State government.
(2) The government of a political subdivision of a State.
(3) Any person other than an individual.
(4) Any combination of entities described in paragraphs
(1), (2), and (3), acting together to carry out one or more
projects for the purposes described in subsection (c).
(c) Grant Purposes.--Grants under this section may be used
for the following purposes:
(1) The acquisition of qualified alternative fueled
vehicles or fuel cell vehicles for routine operation in
service normal for motor vehicles, including (among other
vehicles)--
(A) passenger vehicles, including neighborhood electric
vehicles; and
(B) motorized two-wheel bicycles, scooters, or other
vehicles for use by law enforcement personnel or other State
or local government or metropolitan transportation authority
employees.
(2) The acquisition of qualified alternative fueled
vehicles, hybrid vehicles, or fuel cell vehicles for regular
and routine operation in service normal for motor vehicles,
including (among other vehicles)--
(A) buses used for public transportation or transportation
to and from schools;
(B) delivery vehicles for goods or services;
(C) ground support vehicles at public airports, including
vehicles to carry baggage or push airplanes away from
terminal gates; and
(D) vehicles used for the collection of recyclable garbage
or other garbage.
(3) The acquisition of ultra-low sulfur diesel vehicles for
regular and routine operation in service normal for motor
vehicles.
(4) Infrastructure necessary to directly support an
alternative fueled vehicle, fuel cell vehicle, or hybrid
vehicle project funded by the grant, including fueling and
other support equipment.
(5) Operation and maintenance of vehicles, infrastructure,
and equipment acquired as part of a project funded by the
grant.
(d) Qualified Vehicles.--An alternative fueled vehicle,
hybrid vehicle, or fuel cell vehicle is qualified for the
purposes of subsection (c) if--
(1) in the case of a vehicle to which an emission standard
applies under law, the emissions resulting from the operation
of such vehicle are less than the applicable standard; or
(2) in the case of any gasoline-consuming motor vehicle,
the fuel economy of such vehicle (as defined in section
32901(a) of title 49, United States Code) exceeds by at least
25 percent the average fuel economy standard applicable to
the vehicle under chapter 329 of title 49, United States
Code.
(e) Applications.--
(1) Requirements.--The Secretary shall prescribe the
requirements for applying for grants under the pilot program.
At a minimum, the Secretary shall require that applications
include, for each project proposed in the application, the
following:
(A) A description of the project, including how the project
meets the requirements of this subtitle.
(B) An estimate of the ridership or degree of use of the
project.
(C) An estimate of the air pollution emissions reduced and
fossil fuel displaced as a result of the project, together
with a plan to collect and disseminate environmental data,
related to the project over the expected life of the project.
(D) A description of how the project is to be sustainable
without Federal assistance after the completion of the term
of the grant.
(E) A complete description of the costs of the project,
including acquisition, construction, operation, and
maintenance costs over the expected life of the project.
(F) A description of which costs of the project are to be
supported by Federal assistance under this subtitle.
(G) In the case of a project involving diesel-fueled
vehicles, documentation to the satisfaction of the Secretary
that diesel fuel containing sulfur at not more than 15 parts
per million is available for carrying out the project,
together with a commitment by the applicant to use such fuel
in carrying out the project.
(2) Partners.--An applicant under paragraph (1) may carry
out any project under the pilot program in partnership with
public and private entities.
(f) Selection Criteria.--In evaluating applications under
the pilot program, the Secretary shall consider each
applicant's previous experience with similar projects and
shall give priority consideration to applications that--
(1) propose one or more projects that are most likely--
(A) to cost-effectively reduce vehicle operation emissions;
and
(B) to cost-effectively reduce use of fossil fuel in the
operation of vehicles;
(2) propose one or more projects that are--
(A) to be carried out or sponsored by a government referred
to in paragraph (1) or (2) of subsection (b); or
(B) coordinated with such a government or with a
metropolitan planning organization of such a government;
(3) demonstrate the greatest commitment on the part of the
applicant or applicants to ensure funding for the proposed
project or projects and the greatest likelihood that each
project will be maintained or expanded after Federal
assistance under this subtitle is completed; and
(4) exceed the minimum requirements of subsection (e)(1).
(g) Pilot Project Requirements.--
(1) Maximum amount.--The Secretary shall not provide more
than $20,000,000 in Federal assistance under the pilot
program for any project.
(2) Cost sharing.--
(A) Federal share.--The Secretary shall not provide more
than 50 percent of the cost, incurred during the period of
the grant, of any project under the pilot program.
(B) Applicant share.--The applicant or applicants for a
grant for a project under the pilot program shall provide
funding for the project in an amount that equals or exceeds
the higher of the following amounts:
(i) $1,000,000.
(ii) The amount equal to 20 percent of the total cost of
the project.
(3) Maximum period of grants.--The Secretary shall not fund
any applicant under the pilot program for more than 5 years.
(4) Deployment and distribution.--The Secretary shall seek
to the maximum extent practicable to ensure--
(A) a broad geographic distribution of project sites under
the pilot program; and
(B) the operation of vehicles acquired with the proceeds of
pilot program grants under a variety of vehicle operating
environments, including exposure to extreme weather
conditions and operation of the vehicles in various modes of
service under a variety of operational demands.
(5) Transfer of information and knowledge.--The Secretary
shall establish mechanisms to ensure that the information and
knowledge gained by participants in the pilot program are
transferred among the pilot program participants and to other
interested parties, including other applicants that submitted
applications.
(h) Schedule.--
(1) Publication.--Not later than 90 days after the date of
the enactment of this Act, the Secretary shall publish in the
Federal Register, Commerce Business Daily, and elsewhere as
appropriate, a solicitation of applications for grants for
projects under the pilot program. Applications shall be due
within 180 days after the publication of the first published
notice.
(2) Competitive selection.--Not later than 180 days after
the date by which applications for grants are due, the
Secretary shall select by competitive, peer review all
applications for projects to be awarded a grant under the
pilot program.
(h) Funding for Ultra-Low Sulfur Diesel Vehicles.--Of the
total amount available for a fiscal year for grants under the
pilot program, not less than 20 percent and not more than 25
percent of the grant funding shall be available only for the
acquisition of ultra-low sulfur diesel vehicles.

SEC. 743. AUTHORIZATION OF APPROPRIATIONS.

There is authorized to be appropriated to the Secretary of
Energy for carrying out this subtitle, $40,000,000 for each
of fiscal years 2004, 2005, 2006, 2007, and 2008, to remain
available until expended.
______

SA 1445. Mr. LEVIN submitted an amendment intended to be proposed to

[[Page S10698]]

amendment SA 1432 proposed by Mr. Frist to the bill S. 14, to enhance
the energy security of the United States, and for other purposes; which
was ordered to lie on the table; as follows:

At the end of title VII add the following:

SEC. 736. GRANTS TO INCREASE PRODUCTION OF ENGINES FOR HEAVY-
DUTY CLEAN DIESEL TRUCKS.

(a) Grants.--The Secretary of Energy (in this section
referred to as the ``Secretary'') may award grants to heavy-
duty engine manufacturers for the purpose of funding the
early production of a higher number of heavy-duty diesel
engines for field testing in 2007 emissions standard-
compliant heavy-duty vehicles than would otherwise be
produced.
(b) 2007 Emissions Standard-Compliant Heavy-Duty
Vehicles.--For the purposes of this section, a 2007 emissions
standard-compliant heavy-duty vehicle is a heavy-duty vehicle
that is powered by a heavy-duty diesel engine and designed
and manufactured to comply with the heavy-duty emission
standards of 2007 (as that term is defined in section
734(c)).
(c) Use of Funds.--The Secretary may not award a grant to a
heavy-duty engine manufacturer under this section unless the
manufacturer agrees to use the grant--
(1) to produce, not later than June 30, 2006, new heavy-
duty diesel engines for the field testing program; or
(2) to improve infrastructure related to the production of
such engines.
(d) Application.--To seek a grant under this section, a
heavy-duty engine manufacturer shall submit an application to
the Secretary at such time, in such manner, and containing
such information as the Secretary may reasonably require.
(e) Guidelines for Award of Grants.--In the awarding of
grants under this section, the following guidelines shall
apply:
(1) Purpose.--The purpose of the grant program is to
accelerate and increase the production of heavy-duty diesel
engines for field testing in 2007 emissions standard-
compliant heavy-duty vehicles.
(2) Progressively decreasing amounts of awards.--
(A) In general.--In order to encourage early production of
such engines, the Secretary shall administer the grant
program so as to provide higher amounts in grants awarded
early in the program than the grants that are awarded later
in the program.
(B) Delivery periods.--The Secretary shall divide the grant
program into four successive periods for delivery of 2007
emissions standard-compliant heavy-duty vehicles, as follows:
(i) Period I shall be the period beginning upon
commencement of the pilot program and ending on December 31,
2004.
(ii) Period II shall be the period beginning on January 1,
2005, and ending on June 30, 2005.
(iii) Period III shall be the period beginning on July 1,
2005, and ending on December 31, 2005.
(iv) Period IV shall be the period beginning on January 1,
2006, and ending on June 30, 2006.
(C) Computation of total grant amount.--The amount of a
grant for a recipient under the pilot program shall be the
product of--
(i) an amount determined appropriate by the Secretary for
each emissions standard-compliant heavy-duty vehicle that is
powered by a heavy-duty diesel engine manufactured by the
recipient and is delivered to user; and
(ii) the number of such vehicles that are delivered to
users.
(D) Per vehicle amount.--The amount for each emissions
standard-compliant heavy-duty vehicle shall be significantly
higher for a vehicle that is delivered to the user in a
period defined in subparagraph (B) than the amount for each
such vehicle that is delivered to the user in the next
successive period. The amount for each emissions standard-
compliant heavy-duty vehicle that is delivered to the user in
period IV shall be significantly lower than the amount for
each such vehicle that is delivered to the user in period I.
A vehicle delivered to the user after the end of period IV
shall not be counted in the computation under subparagraph
(C).
(3) Maximum amount per recipient.--No grant recipient may
receive more than 30 percent of the total amount disbursed as
grant proceeds under the grant program.
(f) Refund of Grant Proceeds.--
(1) In general.--The Secretary shall require a grant
recipient to refund some or all of the grant proceeds the
recipient received for the promise to manufacture a heavy-
duty diesel engine for use in a 2007 emissions standard-
compliant heavy-duty vehicle for delivery during a delivery
period under subsection (e)(2)(B) if such vehicle is
delivered later than the promised delivery period (in this
section referred to as a ``late delivery'').
(2) Amount of refund.--The amount of grant proceeds
refunded to the Secretary under paragraph (1) for a late
delivery shall be--
(A) greater than or equal to the difference between--
(i) the amount that was awarded for the promise to deliver
the vehicle during a delivery period under subsection
(e)(2)(B); and
(ii) the amount that would have been awarded for the
delivery of such vehicle during the period in which it was in
fact delivered; and
(B) less than or equal to 100 percent of the amount awarded
for the delivery of such vehicle.
(g) Award and Refund Criteria.--Not later than 120 days
after the date of the enactment of this Act, the Secretary
shall, in consultation with the Administrator, develop and
publish the criteria for--
(1) awarding grants pursuant to the guidelines in
subsection (e); and
(2) calculating the amount of grant proceeds required to be
refunded under subsection (f) in connection with late
deliveries.
(h) Consultation.--The Secretary shall consult with
manufacturers of heavy-duty diesel engines to determine the
costs associated with the accelerated and increased
production of such engines for field testing purposes.
(i) Dissemination of Information.--The Secretary shall--
(1) in consultation with the Administrator, determine
whether and how to share information regarding the
performance of heavy-duty diesel engines developed and tested
under the grant program, including information regarding
durability, maintenance, and fuel economy; and
(2) publish the rationale for such determination in the
Federal Register.
(j) Definitions.--In this section:
(1) Administrator.--The term ``Administrator'' means the
Administrator of the Environmental Protection Agency.
(2) Field testing.--The term ``field testing'' means the
testing prior to mass production of 2007 emissions standard-
compliant heavy-duty vehicles by fleets in coordination with
heavy-duty diesel engine manufacturers.
(3) Heavy-duty diesel engine.--The term ``heavy-duty diesel
engine'' means a diesel engine used to power a truck that is
operated on public streets, roads, or highways and has a
gross vehicle weight rating in excess of 8,500 pounds.
(4) Heavy-duty diesel engine manufacturer.--The term
``heavy-duty diesel engine manufacturer'' means, with respect
to a heavy-duty diesel engine, the company of record holding
the engine certification issued by the United States for the
manufacture of such engine.
(k) Authorization of Appropriations.--There are authorized
to be appropriated such sums as may be necessary to carry out
the grant program under this section.
______

SA 1446. Mr. LEVIN submitted an amendment intended to be proposed to
amendment SA 1432 proposed by Mr. Frist to the bill S. 14, to enhance
the energy security of the United States, and for other purposes; which
was ordered to lie on the table; as follows:

At the end of title VII add the following:

SEC. 736. GRANTS TO INCREASE PRODUCTION OF CLEAN DIESEL MOTOR
VEHICLES, HYBRID VEHICLES, AND FUEL CELL
VEHICLES.

(a) Grants.--The Secretary of Commerce (in this section
referred to as the ``Secretary'') may award grants to States
and cities for use to assist one or more commercial
enterprises in converting existing manufacturing facilities
to produce--
(1) clean diesel motor vehicles;
(2) hybrid vehicles;
(3) fuel cell vehicles; or
(4) engines for use in such vehicles.
(b) Use of Funds.--The proceeds of a grant may only be used
for the following purposes:
(1) The conversion of manufacturing facilities as described
in subsection (a).
(2) The improvement of infrastructure related to any such
facility.
(c) Application.--To seek a grant under this section, a
State or city shall submit an application to the Secretary at
such time, in such manner, and containing such information as
the Secretary may reasonably require.
(d) Definitions.--In this section:
(1) Clean diesel motor vehicle.--The term ``clean diesel
motor vehicle'' means a motor vehicle that--
(A) is powered by a diesel-fueled internal combustion
engine; and
(B) meets the tier 2 emission standards.
(2) Fuel cell vehicle.--The term ``fuel cell vehicle''
means a vehicle propelled by an electric motor powered by a
fuel cell system that converts chemical energy into
electricity by combining oxygen (from air) with hydrogen fuel
that is stored on the vehicle or is produced onboard by
reformation of a hydrocarbon fuel. Such a fuel cell system
may, but is not required to, include the use of auxiliary
energy storage systems to enhance vehicle performance.
(e) Authorization of Appropriations.--There is authorized
to be appropriated such sums as may be necessary to carry out
this section.
______

SA 1447. Mr. LEVIN submitted an amendment intended to be proposed to
amendment SA 1432 proposed by Mr. Frist to the bill S. 14, to enhance
the energy security of the United States, and for other purposes; which
was ordered to lie on the table; as follows:

At the end of title VII add the following:

SEC. 736. GRANTS TO INCREASE PRODUCTION OF ENGINES FOR HEAVY-
DUTY CLEAN DIESEL TRUCKS.

(a) Grants.--The Secretary of Energy (in this section
referred to as the ``Secretary'') may award grants to heavy-
duty engine manufacturers for the purpose of funding the

[[Page S10699]]

early production of a higher number of heavy-duty diesel
engines for field testing in 2007 emissions standard-
compliant heavy-duty vehicles than would otherwise be
produced.
(b) 2007 Emissions Standard-Compliant Heavy-Duty
Vehicles.--For the purposes of this section, a 2007 emissions
standard-compliant heavy-duty vehicle is a heavy-duty vehicle
that is powered by a heavy-duty diesel engine and designed
and manufactured to comply with the heavy-duty emission
standards of 2007 (as that term is defined in section
734(c)).
(c) Use of Funds.--The Secretary may not award a grant to a
heavy-duty engine manufacturer under this section unless the
manufacturer agrees to use the grant--
(1) to produce, not later than June 30, 2006, new heavy-
duty diesel engines for the field testing program; or
(2) to improve infrastructure related to the production of
such engines.
(d) Application.--To seek a grant under this section, a
heavy-duty engine manufacturer shall submit an application to
the Secretary at such time, in such manner, and containing
such information as the Secretary may reasonably require.
(e) Guidelines for Award of Grants.--In the awarding of
grants under this section, the following guidelines shall
apply:
(1) Purpose.--The purpose of the grant program is to
accelerate and increase the production of heavy-duty diesel
engines for field testing in 2007 emissions standard-
compliant heavy-duty vehicles.
(2) Progressively decreasing amounts of awards.--
(A) In general.--In order to encourage early production of
such engines, the Secretary shall administer the grant
program so as to provide higher amounts in grants awarded
early in the program than the grants that are awarded later
in the program.
(B) Delivery periods.--The Secretary shall divide the grant
program into four successive periods for delivery of 2007
emissions standard-compliant heavy-duty vehicles, as follows:
(i) Period I shall be the period beginning upon
commencement of the pilot program and ending on December 31,
2004.
(ii) Period II shall be the period beginning on January 1,
2005, and ending on June 30, 2005.
(iii) Period III shall be the period beginning on July 1,
2005, and ending on December 31, 2005.
(iv) Period IV shall be the period beginning on January 1,
2006, and ending on June 30, 2006.
(C) Computation of total grant amount.--The amount of a
grant for a recipient under the pilot program shall be the
product of--
(i) an amount determined appropriate by the Secretary for
each emissions standard-compliant heavy-duty vehicle that is
powered by a heavy-duty diesel engine manufactured by the
recipient and is delivered to user; and
(ii) the number of such vehicles that are delivered to
users.
(D) Per vehicle amount.--The amount for each emissions
standard-compliant heavy-duty vehicle shall be significantly
higher for a vehicle that is delivered to the user in a
period defined in subparagraph (B) than the amount for each
such vehicle that is delivered to the user in the next
successive period. The amount for each emissions standard-
compliant heavy-duty vehicle that is delivered to the user in
period IV shall be significantly lower than the amount for
each such vehicle that is delivered to the user in period I.
A vehicle delivered to the user after the end of period IV
shall not be counted in the computation under subparagraph
(C).
(3) Maximum amount per recipient.--No grant recipient may
receive more than 30 percent of the total amount disbursed as
grant proceeds under the grant program.
(f) Refund of Grant Proceeds.--
(1) In general.--The Secretary shall require a grant
recipient to refund some or all of the grant proceeds the
recipient received for the promise to manufacture a heavy-
duty diesel engine for use in a 2007 emissions standard-
compliant heavy-duty vehicle for delivery during a delivery
period under subsection (e)(2)(B) if such vehicle is
delivered later than the promised delivery period (in this
section referred to as a ``late delivery'').
(2) Amount of refund.--The amount of grant proceeds
refunded to the Secretary under paragraph (1) for a late
delivery shall be--
(A) greater than or equal to the difference between--
(i) the amount that was awarded for the promise to deliver
the vehicle during a delivery period under subsection
(e)(2)(B); and
(ii) the amount that would have been awarded for the
delivery of such vehicle during the period in which it was in
fact delivered; and
(B) less than or equal to 100 percent of the amount awarded
for the delivery of such vehicle.
(g) Award and Refund Criteria.--Not later than 120 days
after the date of the enactment of this Act, the Secretary
shall, in consultation with the Administrator, develop and
publish the criteria for--
(1) awarding grants pursuant to the guidelines in
subsection (e); and
(2) calculating the amount of grant proceeds required to be
refunded under subsection (f) in connection with late
deliveries.
(h) Consultation.--The Secretary shall consult with
manufacturers of heavy-duty diesel engines to determine the
costs associated with the accelerated and increased
production of such engines for field testing purposes.
(i) Dissemination of Information.--The Secretary shall--
(1) in consultation with the Administrator, determine
whether and how to share information regarding the
performance of heavy-duty diesel engines developed and tested
under the grant program, including information regarding
durability, maintenance, and fuel economy; and
(2) publish the rationale for such determination in the
Federal Register.
(j) Definitions.--In this section:
(1) Administrator.--The term ``Administrator'' means the
Administrator of the Environmental Protection Agency.
(2) Field testing.--The term ``field testing'' means the
testing prior to mass production of 2007 emissions standard-
compliant heavy-duty vehicles by fleets in coordination with
heavy-duty diesel engine manufacturers.
(3) Heavy-duty diesel engine.--The term ``heavy-duty diesel
engine'' means a diesel engine used to power a truck that is
operated on public streets, roads, or highways and has a
gross vehicle weight rating in excess of 8,500 pounds.
(4) Heavy-duty diesel engine manufacturer.--The term
``heavy-duty diesel engine manufacturer'' means, with respect
to a heavy-duty diesel engine, the company of record holding
the engine certification issued by the United States for the
manufacture of such engine.
(k) Authorization of Appropriations.--There are authorized
to be appropriated such sums as may be necessary to carry out
the grant program under this section.

Subtitle D--Advanced Clean Vehicle Demonstration Program

SEC. 741. DEFINITIONS.

In this subtitle:
(1) Alternative fueled vehicle.--The term ``alternative
fueled vehicle'' means a vehicle propelled solely on an
alternative fuel as defined in section 301 of the Energy
Policy Act of 1992 (42 U.S.C. 13211), except the term does
not include any vehicle that the Secretary determines, by
rule, does not yield substantial environmental benefits over
a vehicle operating solely on gasoline or diesel derived from
fossil fuels.
(2) Fuel cell vehicle.--The term ``fuel cell vehicle''
means a vehicle propelled by an electric motor powered by a
fuel cell system that converts chemical energy into
electricity by combining oxygen (from air) with hydrogen fuel
that is stored on the vehicle or is produced onboard by
reformation of a hydrocarbon fuel. Such a fuel cell system
may, but is not required to, include the use of auxiliary
energy storage systems to enhance vehicle performance.
(3) Hybrid vehicle.--The term ``hybrid vehicle'' means--
(A) a motor vehicle that draws propulsion energy from
onboard sources of stored energy that are both--
(i) an internal combustion or heat engine using combustible
fuel; and
(ii) a rechargeable energy storage system; and
(B) any other vehicle that is defined as a hybrid vehicle
in regulations prescribed by the Secretary of Energy for the
administration of title III of the Energy Policy Act of 1992.
(4) Neighborhood electric vehicle.--The term ``neighborhood
electric vehicle'' means a motor vehicle capable of traveling
at speeds of 25 miles per hour that is--
(A) a low-speed vehicle, as such term is defined in section
571.3(b) of title 49, Code of Federal Regulations;
(B) a zero-emission vehicle, as such term is defined in
section 86.1702-99 of title 40, Code of Federal Regulations;
and
(C) otherwise lawful to use on local streets.
(5) Pilot program.--The term ``pilot program'' means the
competitive grant program established under section 742.
(6) State.--The term ``State'' includes the District of
Columbia and the Commonwealth of Puerto Rico.
(7) Ultra-low sulfur diesel vehicle.--The term ``ultra-low
sulfur diesel vehicle'' means a vehicle manufactured in model
year 2002, 2003, 2004, 2005, or 2006 powered by a heavy-duty
diesel engine that--
(A) is fueled by diesel fuel which contains sulfur at not
more than 15 parts per million; and
(B) emits not more than the lesser of--
(i) for vehicles manufactured in--

(I) model years 2002 and 2003, 3.0 grams per brake
horsepower-hour of oxides of nitrogen and .01 grams per brake
horsepower-hour of particulate matter; and
(II) model years 2004 through 2006, 2.5 grams per brake
horsepower-hour of nonmethane hydrocarbons and oxides of
nitrogen and .01 grams per brake horsepower-hour of
particulate matter; or

(ii) the emissions of nonmethane hydrocarbons, oxides of
nitrogen, and particulate matter of the best performing
technology of ultra-low sulfur diesel vehicles of the same
class and application that are commercially available.

SEC. 742. GRANT PILOT PROGRAM.

(a) Requirement for Program.--The Secretary of Energy shall
establish a competitive grant pilot program to provide
project grants to eligible recipients to carry out a project
or projects for the purposes described in subsection (c).

[[Page S10700]]

(b) Eligible Recipients.--The following entities are
eligible to receive a grant under the pilot program:
(1) A State government.
(2) The government of a political subdivision of a State.
(3) Any person other than an individual.
(4) Any combination of entities described in paragraphs
(1), (2), and (3), acting together to carry out one or more
projects for the purposes described in subsection (c).
(c) Grant Purposes.--Grants under this section may be used
for the following purposes:
(1) The acquisition of qualified alternative fueled
vehicles or fuel cell vehicles for routine operation in
service normal for motor vehicles, including (among other
vehicles)--
(A) passenger vehicles, including neighborhood electric
vehicles; and
(B) motorized two-wheel bicycles, scooters, or other
vehicles for use by law enforcement personnel or other State
or local government or metropolitan transportation authority
employees.
(2) The acquisition of qualified alternative fueled
vehicles, hybrid vehicles, or fuel cell vehicles for regular
and routine operation in service normal for motor vehicles,
including (among other vehicles)--
(A) buses used for public transportation or transportation
to and from schools;
(B) delivery vehicles for goods or services;
(C) ground support vehicles at public airports, including
vehicles to carry baggage or push airplanes away from
terminal gates; and
(D) vehicles used for the collection of recyclable garbage
or other garbage.
(3) The acquisition of ultra-low sulfur diesel vehicles for
regular and routine operation in service normal for motor
vehicles.
(4) Infrastructure necessary to directly support an
alternative fueled vehicle, fuel cell vehicle, or hybrid
vehicle project funded by the grant, including fueling and
other support equipment.
(5) Operation and maintenance of vehicles, infrastructure,
and equipment acquired as part of a project funded by the
grant.
(d) Qualified Vehicles.--An alternative fueled vehicle,
hybrid vehicle, or fuel cell vehicle is qualified for the
purposes of subsection (c) if--
(1) in the case of a vehicle to which an emission standard
applies under law, the emissions resulting from the operation
of such vehicle are less than the applicable standard; or
(2) in the case of any gasoline-consuming motor vehicle,
the fuel economy of such vehicle (as defined in section
32901(a) of title 49, United States Code) exceeds by at least
25 percent the average fuel economy standard applicable to
the vehicle under chapter 329 of title 49, United States
Code.
(e) Applications.--
(1) Requirements.--The Secretary shall prescribe the
requirements for applying for grants under the pilot program.
At a minimum, the Secretary shall require that applications
include, for each project proposed in the application, the
following:
(A) A description of the project, including how the project
meets the requirements of this subtitle.
(B) An estimate of the ridership or degree of use of the
project.
(C) An estimate of the air pollution emissions reduced and
fossil fuel displaced as a result of the project, together
with a plan to collect and disseminate environmental data,
related to the project over the expected life of the project.
(D) A description of how the project is to be sustainable
without Federal assistance after the completion of the term
of the grant.
(E) A complete description of the costs of the project,
including acquisition, construction, operation, and
maintenance costs over the expected life of the project.
(F) A description of which costs of the project are to be
supported by Federal assistance under this subtitle.
(G) In the case of a project involving diesel-fueled
vehicles, documentation to the satisfaction of the Secretary
that diesel fuel containing sulfur at not more than 15 parts
per million is available for carrying out the project,
together with a commitment by the applicant to use such fuel
in carrying out the project.
(2) Partners.--An applicant under paragraph (1) may carry
out any project under the pilot program in partnership with
public and private entities.
(f) Selection Criteria.--In evaluating applications under
the pilot program, the Secretary shall consider each
applicant's previous experience with similar projects and
shall give priority consideration to applications that--
(1) propose one or more projects that are most likely--
(A) to cost-effectively reduce vehicle operation emissions;
and
(B) to cost-effectively reduce use of fossil fuel in the
operation of vehicles;
(2) propose one or more projects that are--
(A) to be carried out or sponsored by a government referred
to in paragraph (1) or (2) of subsection (b); or
(B) coordinated with such a government or with a
metropolitan planning organization of such a government;
(3) demonstrate the greatest commitment on the part of the
applicant or applicants to ensure funding for the proposed
project or projects and the greatest likelihood that each
project will be maintained or expanded after Federal
assistance under this subtitle is completed; and
(4) exceed the minimum requirements of subsection (e)(1).
(g) Pilot Project Requirements.--
(1) Maximum amount.--The Secretary shall not provide more
than $20,000,000 in Federal assistance under the pilot
program for any project.
(2) Cost sharing.--
(A) Federal share.--The Secretary shall not provide more
than 50 percent of the cost, incurred during the period of
the grant, of any project under the pilot program.
(B) Applicant share.--The applicant or applicants for a
grant for a project under the pilot program shall provide
funding for the project in an amount that equals or exceeds
the higher of the following amounts:
(i) $1,000,000.
(ii) The amount equal to 20 percent of the total cost of
the project.
(3) Maximum period of grants.--The Secretary shall not fund
any applicant under the pilot program for more than 5 years.
(4) Deployment and distribution.--The Secretary shall seek
to the maximum extent practicable to ensure--
(A) a broad geographic distribution of project sites under
the pilot program; and
(B) the operation of vehicles acquired with the proceeds of
pilot program grants under a variety of vehicle operating
environments, including exposure to extreme weather
conditions and operation of the vehicles in various modes of
service under a variety of operational demands.
(5) Transfer of information and knowledge.--The Secretary
shall establish mechanisms to ensure that the information and
knowledge gained by participants in the pilot program are
transferred among the pilot program participants and to other
interested parties, including other applicants that submitted
applications.
(h) Schedule.--
(1) Publication.--Not later than 90 days after the date of
the enactment of this Act, the Secretary shall publish in the
Federal Register, Commerce Business Daily, and elsewhere as
appropriate, a solicitation of applications for grants for
projects under the pilot program. Applications shall be due
within 180 days after the publication of the first published
notice.
(2) Competitive selection.--Not later than 180 days after
the date by which applications for grants are due, the
Secretary shall select by competitive, peer review all
applications for projects to be awarded a grant under the
pilot program.
(h) Funding for Ultra-Low Sulfur Diesel Vehicles.--Of the
total amount available for a fiscal year for grants under the
pilot program, not less than 20 percent and not more than 25
percent of the grant funding shall be available only for the
acquisition of ultra-low sulfur diesel vehicles.

SEC. 743. AUTHORIZATION OF APPROPRIATIONS.

There is authorized to be appropriated to the Secretary of
Energy for carrying out this subtitle, $40,000,000 for each
of fiscal years 2004, 2005, 2006, 2007, and 2008, to remain
available until expended.
______

SA 1448. Mr. LEVIN submitted an amendment intended to be proposed to
amendment SA 1432 proposed by Mr. Frist to the bill S. 14, to enhance
the energy security of the United States, and for other purposes; which
was ordered to lie on the table; as follows:

At the appropriate place, insert the following:

SEC. ____. MODIFICATIONS TO NEW QUALIFIED HYBRID MOTOR
VEHICLE CREDIT.

(a) Modifications to Light Duty Hybrids.--
(1) Increase in credit amounts after 2004.--
(A) In general.--Section 30B(c)(2), as added by section
201(a), is amended--
(i) by striking clause (i) of subparagraph (A) and
inserting the following new clause:
``(i) In the case of a new qualified hybrid motor vehicle
which is a passenger automobile, medium duty passenger
vehicle, or light truck and which provides the following
percentage of the maximum available power:

``(I) If such vehicle is placed in service after the date
of the enactment of this section and before January 1, 2005:

``If percentage of the maximum
available power is:                             The credit amount is:
At least 4 percent but less than 10 percent.......................$250
At least 10 percent but less than 20 percent......................$500
At least 20 percent but less than 30 percent......................$750
At least 30 percent.............................................$1,000.

``(II) If such vehicle is placed in service after December
31, 2004:

``If percentage of the maximum
available power is:                             The credit amount is:
At least 4 percent but less than 10 percent.......................$350
At least 10 percent but less than 20 percent......................$600
At least 20 percent but less than 30 percent......................$850
At least 30 percent..........................................$1,100.'',
(ii) by striking ``$500'' in subparagraph (B)(i)(I) and
inserting ``$500 ($600 in the case of any vehicle placed in
service after December 31, 2004)'',
(iii) by striking ``$1,000'' in subparagraph (B)(i)(II) and
inserting ``$1,000 ($1,100 in the case of any vehicle placed
in service after December 31, 2004)'',

[[Page S10701]]

(iv) by striking ``$1,500'' in subparagraph (B)(i)(III) and
inserting ``$1,500 ($1,600 in the case of any vehicle placed
in service after December 31, 2004)'',
(v) by striking ``$2,000'' in subparagraph (B)(i)(IV) and
inserting ``$2,000 ($2,100 in the case of any vehicle placed
in service after December 31, 2004)'',
(vi) by striking ``$2,500'' in subparagraph (B)(i)(V) and
inserting ``$2,500 ($2,600 in the case of any vehicle placed
in service after December 31, 2004)'', and
(vii) by striking ``$3,000'' in subparagraph (B)(i)(VI) and
inserting ``$3,000 ($3,100 in the case of any vehicle placed
in service after December 31, 2004)''.
(B) Effective date.--The amendments made by this paragraph
shall apply to property placed in service after the date of
the enactment of this Act, in taxable years ending after such
date.
(2) Option to use like vehicle.--
(A) In general.--Section 30B(c)(2), as added by section
201(a), is amended--
(i) by adding at the end of subparagraph (B) the following
new clause:
``(iii) Option to use like vehicle.--For purposes of clause
(i), at the option of the vehicle manufacturer, the increase
for fuel efficiency may be calculated by comparing the new
qualified hybrid motor vehicle to a `like vehicle'.'', and
(ii) by adding at the end of subparagraph (D) the following
new clause:
``(iii) Like vehicle.--For purposes of subparagraph
(B)(iii), the term `like vehicle' for a new qualified hybrid
motor vehicle derived from a conventional production vehicle
produced in the same model year means a model that is
equivalent in the following areas:

``(I) Body style (2-door or 4-door).
``(II) Transmission (automatic or manual).
``(III) Acceleration performance (<plus-minus> 0.05
seconds).
``(IV) Drivetrain (2-wheel drive or 4-wheel drive).
``(V) Certification by the Administrator of the
Environmental Protection Agency.''.

(B) Effective date.--The amendments made by this paragraph
shall apply to property placed in service after December 31,
2004, in taxable years ending after such date.
(b) Hybrid Vehicle Credit for Lifetime Fuel Savings.--
(1) In general.--Section 30B(c)(2), as added by section
201(a) and amended by this section, is amended--
(A) by redesignating subparagraph (D) as subparagraph (E),
(B) by inserting after subparagraph (C) the following new
subparagraph:
``(D) Conservation credit.--
``(i) Amount.--The amount determined under subparagraph
(A)(i) with respect to a passenger automobile, medium duty
passenger vehicle, or light truck shall be increased by--

``(I) $350, if such vehicle achieves a lifetime fuel
savings of at least 1,200 but less than 1,800 gallons of
gasoline,
``(II) $600, if such vehicle achieves a lifetime fuel
savings of at least 1,800 but less than 2,400 gallons of
gasoline,
``(III) $850, if such vehicle achieves a lifetime fuel
savings of at least 2,400 but less than 3,000 gallons of
gasoline, and
``(IV) $1,100, if such vehicle achieves a lifetime fuel
savings of at least 3,000 gallons of gasoline.

``(ii) Lifetime fuel savings for like vehicle.--For
purposes of clause (i), at the option of the vehicle
manufacturer, the lifetime fuel savings fuel may be
calculated by comparing the new qualified hybrid motor
vehicle to a `like vehicle'.'', and
(C) by adding at the end of subparagraph (E) (as
redesignated by subparagraph (A)) the following new clause:
``(iv) Lifetime fuel savings.--For purposes of subparagraph
(D), the term `lifetime fuel savings' shall be calculated by
dividing 120,000 by the difference between the 2002 model
year city fuel economy for the vehicle inertia weight class
(as defined in subsection (b)(2)(C)) and the city fuel
economy for the new qualified hybrid motor vehicle.''.
(2) Effective date.--The amendments made by this subsection
shall apply to property placed in service after December 31,
2004, in taxable years ending after such date.
(c) Change in Effective Dates.--
(1) In general.--Subsection (h) of section 30B, as added by
section 201(a), is amended to read as follows:
``(h) Application of Section.--This section shall apply
to----
``(1) any new qualified fuel cell motor vehicle (as
described in subsection (b)) placed in service after December
31, 2004, and purchased before January 1, 2014,
``(2) any new qualified hybrid motor vehicle (as described
in subsection (c)) placed in service after the date of the
enactment of this section, and purchased before January 1,
2010, and
``(3) any other property placed in service after such date
of enactment, and purchased before January 1, 2007.''.
(2) Conforming amendment.--Subparagraph (B) of section
30B(b)(3), as added by section 201(a), is amended to read as
follows:
``(B) which, in the case of a passenger automobile or light
truck for 2004 and later model vehicles, has received a
certificate that such vehicle meets or exceeds the Bin 5 Tier
II emission level established in regulations prescribed by
the Administrator of the Environmental Protection Agency
under section 202(i) of the Clean Air Act for that make and
model year vehicle,''.
(3) Effective date.--The amendments made by this subsection
shall apply to property placed in service after the date of
the enactment of this Act, in taxable years ending after such
date.
(d) Credit for Advanced Lean Burn Diesel Technology.--
(1) In general.--Section 30B, as added by section 201(a)
and amended by this section, is amended--
(A) by striking ``and'' at the end of subsection (a)(2),
(B) by striking the period at the end of subsection (a)(3)
and inserting ``, and'',
(C) by adding at the end of subsection (a) the following
new paragraph:
``(4) the advanced lean burn technology motor vehicle
credit determined under subsection (g).'', and
(D) by redesignating subsections (g) and (h) as subsections
(h) and (i), respectively, and by inserting after subsection
(f) the following new subsection:
``(g) Advanced Lean Burn Technology Motor Vehicle Credit.--
``(1) In general.--For purposes of subsection (a), the
advanced lean burn technology motor vehicle credit determined
under this subsection with respect to a new qualified
advanced lean burn technology motor vehicle placed in service
by the taxpayer during the taxable year is the credit amount
determined under paragraph (2).
``(2) Credit amount.--
``(A) Increase for fuel efficiency.--The credit amount
determined under this paragraph shall be--
``(i) $350, if such vehicle achieves at least 125 percent
but less than 150 percent of the 2002 model year city fuel
economy,
``(ii) $600, if such vehicle achieves at least 150 percent
but less than 175 percent of the 2002 model year city fuel
economy,
``(iii) $850, if such vehicle achieves at least 175 percent
but less than 200 percent of the 2002 model year city fuel
economy, and
``(iv) $1,100, if such vehicle achieves at least 200
percent of the 2002 model year city fuel economy.

For purposes of clause (i), the 2002 model year city fuel
economy with respect to a vehicle shall be determined using
the tables provided in subsection (b)(2)(B) with respect to
such vehicle.
``(B) Conservation credit.--The amount determined under
subparagraph (A) with respect to an advanced lean burn
technology motor vehicle shall be increased by--
``(i) $350, if such vehicle achieves a lifetime fuel
savings of at least 1,200 but less than 1,800 gallons of
gasoline,
``(ii) $600, if such vehicle achieves a lifetime fuel
savings of at least 1,800 but less than 2,400 gallons of
gasoline,
``(iii) $850, if such vehicle achieves a lifetime fuel
savings of at least 2,400 but less than 3,000 gallons of
gasoline, and
``(iv) $1,100, if such vehicle achieves a lifetime fuel
savings of at least 3,000 gallons of gasoline.
``(C) Option to use like vehicle.--At the option of the
vehicle manufacturer, the increase for fuel efficiency and
conservation credit may be calculated by comparing the new
advanced lean-burn technology motor vehicle to a like
vehicle.
``(3) Definitions.--For purposes of this subsection--
``(A) New advanced lean burn technology motor vehicle.--The
term `new advanced lean burn technology motor vehicle' means
a motor vehicle with an internal combustion engine--
``(i) which is designed to operate primarily using more air
than is necessary for complete combustion of the fuel,
``(ii) which incorporates direct injection,
``(iii) which achieves at least 125 percent of the 2002
model year city fuel economy,
``(iv) which, for 2005 and later model vehicles, has
received a certificate that such vehicle meets or exceeds the
Bin 5 Tier II emission levels for passenger vehicles
established in regulations prescribed by the Administrator of
the Environmental Protection Agency under section 202(i) of
the Clean Air Act for that make and model year vehicle,
except any manufacturer may provide not to exceed 5,000
passenger vehicles per year which are Tier II compliant,
``(v) the original use of which commences with the
taxpayer,
``(vi) which is acquired for use or lease by the taxpayer
and not for resale, and
``(vii) which is made by a manufacturer.
``(B) Like vehicle.--The term `like vehicle' for an
advanced lean burn technology motor vehicle derived from a
conventional production vehicle produced in the same model
year means a model that is equivalent in the following areas:
``(i) Body style (2-door or 4-door),
``(ii) Transmission (automatic or manual),
``(iii) Acceleration performance (<plus-minus> 0.05
seconds).
``(iv) Drivetrain (2-wheel drive or 4-wheel drive).
``(v) Certification by the Administrator of the
Environmental Protection Agency.
``(C) Lifetime fuel savings.--The term `lifetime fuel
savings' shall be calculated by dividing 120,000 by the
difference between the 2002 model year city fuel economy for
the vehicle inertia weight class (as defined in subsection
(b)(2)(C)) and the city fuel economy for the new qualified
hybrid motor vehicle.''.
(2) Effective date.--The amendments made by this subsection
shall apply to property placed in service after December 31,
2004, in taxable years ending after such date.

[[Page S10702]]

SEC. ____. CREDIT FOR CLEAN HEAVY-DUTY DIESEL VEHICLES.

(a) In General.--Section 30B(a), as added by section 201(a)
and amended by this Act, is amended--
(1) by striking ``and'' at the end of paragraph (3),
(2) by striking the period at the end of paragraph (4) and
inserting ``, and'',
(3) by adding at the end the following new paragraph:
``(5) the clean heavy-duty diesel motor vehicle credit
determined under subsection (h).''.
(b) Clean Heavy-Duty Diesel Motor Vehicle Credit.--Section
30B, as added by section 201(a) and amended by this Act, is
amended by redesignating subsections (h) and (i) as
subsections (i) and (j), respectively, and by inserting after
subsection (g) the following new subsection:
``(h) Clean Heavy-Duty Diesel Motor Vehicle Credit.--
``(1) In general.--For purposes of subsection (a), the
clean heavy-duty diesel motor vehicle credit determined under
this subsection with respect to a new clean heavy-duty diesel
motor vehicle placed in service by the taxpayer during the
taxable year is the credit amount determined under paragraph
(2).
``(2) Credit amount.--The credit amount determined under
this paragraph shall be the sum of--
``(A) for any 2006 model vehicle, 50 percent of the
incremental cost of such vehicle, if such vehicle meets the
heavy-duty emission standards of 2007,plus
``(B) for any 2006 or later model vehicle, $2,500, if such
vehicle meets the heavy-duty emission standards of 2010.
``(3) Definitions and special rules.--For purposes of this
subsection--
``(A) New heavy-duty diesel motor vehicle.--The term `new
heavy-duty diesel motor vehicle' means a motor vehicle with a
diesel-fueled internal combustion engine--
``(i) which has a gross vehicle weight rating of at least
8,500 pounds,
``(ii) the original use of which commences with the
taxpayer,
``(iii) which is acquired for use or lease by the taxpayer
and not for resale, and
``(iv) which is made by a manufacturer.
``(B) Incremental cost.--The incremental cost of any new
clean heavy-duty diesel motor vehicle is equal to the amount
of the excess of the manufacturer's suggested retail price
for such vehicle over such price for a motor vehicle of the
same model described in subparagraph (A) without regard to
clause (ii) thereof, to the extent such amount does not
exceed $5,000.
``(C) Heavy-duty emission standards of 2007.--The term
`heavy-duty emission standards of 2007' means the motor
vehicle emission standards promulgated by the Administrator
of the Environmental Protection Agency on January 18, 2001,
under section 202 of the Clean Air Act to apply to heavy-duty
vehicles of model years beginning with the 2007 vehicle model
year.
``(D) Heavy-duty emission standards of 2010.--The term
`heavy-duty emission standards of 2010' means the motor
vehicle emission standards promulgated by the Administrator
of the Environmental Protection Agency under section 202 of
the Clean Air Act to apply to heavy-duty vehicles of model
years beginning with the 2010 vehicle model year.
(d) Change in Effective Dates.--Subsection (j) of section
30B, as redesignated by subsection (b), is amended to read as
follows:
``(j) Application of Section.--This section shall apply
to----
``(1) any new qualified fuel cell motor vehicle (as
described in subsection (b)) placed in service after December
31, 2004, and purchased before January 1, 2014,
``(2) any new qualified hybrid motor vehicle (as described
in subsection (c)) placed in service after the date of the
enactment of this section, and purchased before January 1,
2010, and
``(3) any new clean heavy-duty diesel motor vehicle (as
described in subsection (h)) placed in service after December
31, 2005, and purchased before January 1, 2010, and
``(4) any other property placed in service after such date
of enactment, and purchased before January 1, 2007.''.
(e) Effective Date.--The amendments made by this section
shall apply to property placed in service after December 31,
2005, in taxable years ending after such date.

SEC. ____. CREDIT FOR PRODUCING LOW SULFUR CONTENT DIESEL
FUEL.

(a) In General.--Subpart B of part IV of subchapter A of
chapter 1 (relating to other credits), as amended by this
Act, is amended by inserting after section 30C the following
new section:

``SEC. 30D. CREDIT FOR PRODUCING CLEAN DIESEL FUEL.

``(a) Allowance of Credit.--There shall be allowed as a
credit against the tax imposed by this chapter for the
taxable year an amount equal to--
``(1) the applicable dollar amount, multiplied by
``(2) the barrel-of-oil equivalent of clean diesel fuel--
``(A) sold by the taxpayer to an unrelated person during
the taxable year, and
``(B) the production of which is attributable to the
taxpayer.
``(b) Applicable Dollar Amount.--For purposes of subsection
(a)(1), the applicable dollar amount for fuel sold during the
period--
``(1) beginning on the date which is 90 days after the date
of the enactment of this section and ending before June 1,
2006, is $4.20, and
``(2) beginning after May 31, 2006, and ending before
January 1, 2007, $2.10.
``(b) Limitations and Adjustments.--
``(1) Credit reduced for grants, tax-exempt bonds, and
subsidized energy financing.--
``(A) In general.--The amount of the credit allowable under
subsection (a) with respect to any project for any taxable
year shall be reduced by the amount which is the product of
the amount so determined for such year and a fraction--
``(i) the numerator of which is the sum, for the taxable
year and all prior taxable years, of--

``(I) grants provided by the United States, a State, or a
political subdivision of a State for use in connection with
the project,
``(II) proceeds of any issue of State or local government
obligations used to provide financing for the project the
interest on which is exempt from tax under section 103, and
``(III) the aggregate amount of subsidized energy financing
(within the meaning of section 48(a)(6)(C)) provided in
connection with the project, and

``(ii) the denominator of which is the aggregate amount of
additions to the capital account for the project for the
taxable year and all prior taxable years.
``(B) Amounts determined at close of year.--The amounts
under subparagraph (A) for any taxable year shall be
determined as of the close of the taxable year.
``(2) Credit reduced for enhanced oil recovery credit and
environmental tax credit.--The amount allowable as a credit
under subsection (a) with respect to any project for any
taxable year (determined after application of paragraphs (1)
and (3)) shall be reduced by the excess (if any) of--
``(A) the aggregate amount allowed under section 38 for the
taxable year and any prior taxable year by reason of any
enhanced oil recovery credit determined under section 43 and
any environmental tax credit determined under section 45L
with respect to such project, over
``(B) the aggregate amount recaptured with respect to the
amount described in subparagraph (A) under this paragraph for
any prior taxable year.
``(3) Application with other credits.--The credit allowed
by subsection (a) for any taxable year shall not exceed the
excess (if any) of--
``(A) the regular tax for the taxable year reduced by the
sum of the credits allowable under subpart A and this subpart
(other than this section), over
``(B) the tentative minimum tax for the taxable year.
``(c) Definitions and Special Rules.--For purposes of this
section--
``(1) Clean diesel fuel.--The term `clean diesel fuel'
means motor vehicle diesel fuel which upon sale has a sulfur
content as low as feasible, as determined by the
Administrator of the Environmental Protection Agency taking
into consideration costs, but not higher than 15 ppm.
``(2) Only production within the united states taken into
account.--Sales shall be taken into account under this
section only with respect to diesel fuel the production of
which is within--
``(A) the United States (within the meaning of section
638(1)), or
``(B) a possession of the United States (within the meaning
of section 638(2)).
``(3) Production attributable to the taxpayer.--In the case
of a property or facility in which more than 1 person has an
interest, except to the extent provided in regulations
prescribed by the Secretary, production from the property or
facility (as the case may be) shall be allocated among such
persons in proportion to their respective interests in the
gross sales from such property or facility.
``(4) Barrel-of-oil equivalent.--The term `barrel-of-oil
equivalent' with respect to any fuel means that amount of
such fuel which has a Btu content of 5.8 million.
``(5) Barrel defined.--The term `barrel' means 42 United
States gallons.
``(6) Related persons.--Persons shall be treated as related
to each other if such persons would be treated as a single
employer under the regulations prescribed under section
52(b). In the case of a corporation which is a member of an
affiliated group of corporations filing a consolidated
return, such corporation shall be treated as selling clean
diesel fuel to an unrelated person if such fuel is sold to
such a person by another member of such group.
``(7) Pass-thru in the case of estates and trusts.--Under
regulations prescribed by the Secretary, rules similar to the
rules of subsection (d) of section 52 shall apply.
``(e) Termination.--This section shall not apply with
respect to clean diesel fuel which is sold at retail after
December 31, 2006.''.
(b) Conforming Amendments.--
(1) Section 53(d)(1)(B)(iii), as amended by this Act, is
amended by striking ``or'' and inserting before the period at
the end the following: ``, or under section 30D solely by
reason of the application of section 30D(b)(3)''.
(2) Section 55(c)(2), as amended by this Act, is amended by
inserting ``, 30D(b)(3),'' after ``30(b)(2)''.
(3) Section 772 is amended--
(A) in subsection (a), by striking ``and'' at the end of
paragraph (10), by redesignating paragraph (11) as paragraph
(12), and by inserting after paragraph (10) the following new
paragraph:

[[Page S10703]]

``(11) the credit allowable under section 30D, and'', and
(B) in subsection (d)(5), by striking ``and'', and by
inserting before the period the following: ``, and the credit
allowable under section 30D''.
(4) The table of sections for subpart B of part IV of
subchapter A of chapter 1, as amended by this Act, is amended
by inserting after the item relating to section 30C the
following new item:

``Sec. 30D. Credit for producing clean diesel fuel.''.
(c) Effective Date.--The amendments made by this section
shall apply to sales on and after the date which is 90 days
after the date of the enactment of this Act.

SEC. ____. PREVENTING CORPORATE EXPATRIATION TO AVOID UNITED
STATES INCOME TAX.

(a) In General.--Paragraph (4) of section 7701(a) (defining
domestic) is amended to read as follows:
``(4) Domestic.--
``(A) In general.--Except as provided in subparagraph (B),
the term `domestic' when applied to a corporation or
partnership means created or organized in the United States
or under the law of the United States or of any State unless,
in the case of a partnership, the Secretary provides
otherwise by regulations.
``(B) Certain corporations treated as domestic.--
``(i) In general.--The acquiring corporation in a corporate
expatriation transaction shall be treated as a domestic
corporation.
``(ii) Corporate expatriation transaction.--For purposes of
this subparagraph, the term `corporate expatriation
transaction' means any transaction if--

``(I) a nominally foreign corporation (referred to in this
subparagraph as the `acquiring corporation') acquires, as a
result of such transaction, directly or indirectly
substantially all of the properties held directly or
indirectly by a domestic corporation, and
``(II) immediately after the transaction, more than 80
percent of the stock (by vote or value) of the acquiring
corporation is held by former shareholders of the domestic
corporation by reason of holding stock in the domestic
corporation.

``(iii) Lower stock ownership requirement in certain
cases.--Subclause (II) of clause (ii) shall be applied by
substituting `50 percent' for `80 percent' with respect to
any nominally foreign corporation if--

``(I) such corporation does not have substantial business
activities (when compared to the total business activities of
the expanded affiliated group) in the foreign country in
which or under the law of which the corporation is created or
organized, and
``(II) the stock of the corporation is publicly traded and
the principal market for the public trading of such stock is
in the United States.

``(iv) Partnership transactions.--The term `corporate
expatriation transaction' includes any transaction if--

``(I) a nominally foreign corporation (referred to in this
subparagraph as the `acquiring corporation') acquires, as a
result of such transaction, directly or indirectly properties
constituting a trade or business of a domestic partnership,
``(II) immediately after the transaction, more than 80
percent of the stock (by vote or value) of the acquiring
corporation is held by former partners of the domestic
partnership or related foreign partnerships (determined
without regard to stock of the acquiring corporation which is
sold in a public offering related to the transaction), and
``(III) the acquiring corporation meets the requirements of
subclauses (I) and (II) of clause (iii).

``(v) Special rules.--For purposes of this subparagraph--

``(I) a series of related transactions shall be treated as
1 transaction, and
``(II) stock held by members of the expanded affiliated
group which includes the acquiring corporation shall not be
taken into account in determining ownership.

``(vi) Other definitions.--For purposes of this
subparagraph--

``(I) Nominally foreign corporation.--The term `nominally
foreign corporation' means any corporation which would (but
for this subparagraph) be treated as a foreign corporation.
``(II) Expanded affiliated group.--The term `expanded
affiliated group' means an affiliated group (as defined in
section 1504(a) without regard to section 1504(b)).
``(III) Related foreign partnership.--A foreign partnership
is related to a domestic partnership if they are under common
control (within the meaning of section 482), or they shared
the same trademark or tradename.''

(b) Effective Dates.--
(1) In general.--The amendment made by this section shall
apply to corporate expatriation transactions completed after
September 11, 2001.
(2) Special rule.--The amendment made by this section shall
also apply to corporate expatriation transactions completed
on or before September 11, 2001, but only with respect to
taxable years of the acquiring corporation beginning after
December 31, 2003.
______

SA 1449. Mr. BYRD submitted an amendment intended to be proposed by
him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

Strike section 202 and insert the following:

SEC. 202. PROJECT CRITERIA.

(a) In General.--The Secretary shall not provide funding
under this subtitle for any project that does not advance
efficiency, environmental performance, and cost
competitiveness beyond the level of technologies that are in
operation or have been demonstrated as of the date of the
enactment of this Act.
(b) Technical Criteria for Gasification.--In allocating the
funds made available under section 201, the Secretary shall
ensure that at least 80 percent of the funds are used for
coal-based gasification technologies, including projects that
include gasification combined cycle, gasification fuel cells,
gasification co-production, or hybrid gasification/
combustion, and coal-based oxidation technologies that result
in concentrated streams of carbon dioxide for capture and
sequestration. The Secretary shall set technical milestones
specifying emissions levels that coal gasification projects
must be designed to and reasonably expected to achieve. The
milestones shall get more restrictive through the life of the
program. The milestones shall be designed to achieve by 2020
coal gasification projects able to--
(1) remove 99 percent of sulfur dioxide;
(2) emit no more than .05 lbs of NOx per million Btu;
(3) achieve substantial reductions in mercury emissions;
and
(4) achieve a thermal efficiency of--
(A) 60 percent for coal of more than 9,000 Btu;
(B) 59 percent for coal of 7,000 to 9,000 Btu; and
(C) 57 percent for coal of less than 7,000 Btu.
(c) Technical Criteria for Other Projects.--For projects
not described in subsection (b), the Secretary shall set
technical milestones specifying emissions levels that the
projects must be designed to and reasonably expected to
achieve. The milestones shall get more restrictive through
the life of the program. The milestones shall be designed to
achieve by 2010 projects able to--
(1) remove 97 percent of sulfur dioxide;
(2) emit no more than .08 lbs of NOx per million Btu;
(3) achieve substantial reductions in mercury emissions;
and
(4) achieve a thermal efficiency of--
(A) 45 percent for coal of more than 9,000 Btu;
(B) 44 percent for coal of 7,000 to 9,000 Btu; and
(C) 42 percent for coal of less than 7,000 Btu.
(d) Existing Units.--In the case of projects at existing
units, in lieu of the thermal efficiency requirements set
forth in paragraphs (b)(4) and (c)(4), the projects shall be
designed to achieve an overall thermal design efficiency
improvement compared to the efficiency of the unit as
operated, of not less than--
(A) 7 percent for coal of more than 9,000 Btu;
(B) 6 percent for coal of 7,000 to 9,000 Btu; or
(C) 4 percent for coal of less than 7,000 Btu.
(e) Consultation.--Before setting the technical milestones
under subsections (b) and (c), the Secretary shall consult
with the Administrator of the Environmental Protection Agency
and interested entities, including coal producers, industries
using coal, organizations to promote coal or advanced coal
technologies, environmental organizations, and organizations
representing workers.
(f) Financial Criteria.--The Secretary shall not provide a
funding award under this title unless the recipient has
documented to the satisfaction of the Secretary that--
(1) the award recipient has an adequate financial plan for
carrying out the project;
(2) the recipient will provide sufficient information to
the Secretary for the Secretary to ensure that the award
funds are spent efficiently and effectively; and
(3) a market exists for the technology being demonstrated
or applied, as evidenced by statements of interest in writing
from potential purchasers of the technology.
(g) Financial Assistance.--The Secretary shall provide
financial assistance to projects that meet the requirements
of this section and are likely to--
(1) achieve overall cost reductions in the utilization of
coal to generate useful forms of energy while complying with
environmental standards;
(2) improve the competitiveness of coal among various forms
of energy; and
(3) demonstrate methods and equipment that are applicable
to 25 percent of the electricity generating facilities that
use coal as the primary feedstock as of the date of the
enactment of this Act.
(h) Federal Share.--
(1) In general.--The Federal share of the cost of a coal or
related technology project funded by the Secretary shall not
exceed 50 percent.
(2) Repayment terms.--The Secretary shall not require
repayment for the Federal share of the cost of a coal or
related technology project selected under this section.
(i) Applicability.--No technology, or level of emission
reduction, shall be treated as adequately demonstrated for
purposes of section 111 of the Clean Air Act, achievable for
purposes of section 169 of that Act, or achievable in
practice for purposes of section 171 of that Act solely by
reason of the use of such technology, or the achievement of
such emission reduction, by one or more facilities receiving
assistance under this title.

[[Page S10704]]

______

SA 1450. Mr. NELSON of Florida submitted an amendment intended to be
proposed by him to the bill S. 14, to enhance the energy security of
the United States, and for other purposes; which was ordered to lie on
the table; as follows:

At the appropriate place, insert the following:

SEC. 973. WESTERN HEMISPHERE ENERGY COOPERATION.

(a) Definition of Secretary.--In this section, the term
``Secretary'' means the Secretary of Energy.
(b) Program.--The Secretary shall carry out a program to
promote cooperation on energy issues with Western Hemisphere
countries.
(c) Activities.--Under the program, the Secretary shall
fund activities to work with Western Hemisphere countries
to--
(1) assist the countries in formulating and adopting
changes in economic policies and other policies to--
(A) increase the production of energy supplies; and
(B) improve energy efficiency; and
(2) assist in the development and transfer of energy supply
and efficiency technologies that would have a beneficial
impact on world energy markets.
(d) University Participation.--To the extent practicable,
the Secretary shall carry out the program with the
participation of universities so as to take advantage of the
acceptance of universities by Western Hemisphere countries as
sources of unbiased technical and policy expertise when
assisting the Secretary in--
(1) evaluating new technologies;
(2) resolving technical issues; and
(3) working with those countries in the development of new
policies; and
(4) training policymakers, particularly in the case of
universities that involve the participation of minority
students, such as Hispanic-serving institutions and
Historically Black Colleges and Universities.
(e) Authorization of Appropriations.--There are authorized
to be appropriated to carry out this section--
(1) $8,000,000 for fiscal year 2004;
(2) $10,000,000 for fiscal year 2005;
(3) $13,000,000 for fiscal year 2006;
(4) $16,000,000 for fiscal year 2007; and
(5) $19,000,000 for fiscal year 2008.
______

SA 1451. Mr. NELSON of Florida submitted an amendment intended to be
proposed by him to the bill S. 14, to enhance the energy security of
the United States, and for other purposes; which was ordered to lie on
the table; as follows:

SEC. 308 ENERGY CREDIT FOR COMBINED HEAT AND POWER SYSTEM
PROPERTY.

At the appropriate place, insert the following to paragraph
(5)(A)(iv), after ``capacities'' and before the parenthesis:
or 45% in the case of a system which uses biomass, as
defined in section 45(c)(3)(A)(III), as the principal fuel.
On page 134, between lines 12 and 13, insert the following
at the end of (5)(A)(v) the following:
(vi) Coordination with Section 38(b)(8)--No credit shall be
allowed under section 38(b)(1) (investment credit) because
such property qualifies as combined heat and power system
property under this paragraph.
______

SA 1452. Mr. DORGAN submitted an amendment intended to be proposed by
him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of title III of division B add the following:

SEC. 310. EXPANSION OF CREDIT FOR RESIDENTIAL ENERGY
EFFICIENT PROPERTY TO INCLUDE ELECTRIC THERMAL
STORAGE UNIT.

(a) In General.--Section 25C(b)(1)(C) (relating to maximum
credit), as added by this Act, is amended--
(1) by striking ``and'' at the end of clause (v),
(2) by striking the period at the end of clause (vi) and
inserting ``, and'', and
(3) by adding at the end the following new clause:
``(vii) $250 for each electric thermal storage unit.''.
(b) Electric Thermal Storage Unit.--Section 25C(d)(6)(B),
as added by this Act, is amended--
(1) by striking ``and'' at the end of clause (v),
(2) by striking the period at the end of clause (vi) and
inserting ``, and'', and
(3) by adding at the end the following new clause:
``(vii) an electric thermal storage unit which converts
low-cost, off-peak electricity to heat and stores such heat
for later use in specially designed ceramic bricks.''.
(c) Effective Date.--The amendments made by this section
shall apply to expenditures after the date of the enactment
of this Act, in taxable years ending after such date.
______

SA 1453. MR. DORGAN submitted an amendment intended to be proposed by
him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

In division B, beginning on page 7, line 24, strike all
through page 8, line 3, and insert the following:
``(1) Wind facility.--
``(A) In general.--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, and before January 1, 2009.
``(B) Special rule.--In the case of electricity produced
after 2003 at any facility described in subparagraph (A)
which is placed in service after the date of the enactment of
the Energy Tax Incentives Act of 2003, subsection (a)(1)
shall be applied by substituting `1.8 cents' for `1.5 cents'.
On page 14, line 15, insert ``(other than subsection
(d)(1)(B))'' after ``section''.
______

SA 1454. Mr. LANDRIEU submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

Strike section 932 and insert the following:

SEC. 932. BIOENERGY PROGRAM.

(a) Definition.--In this section, the term ``cellulosic
biomass'' means any portion of a crop containing
lignocellulose or hemicellulose or any crop grown
specifically for the purpose of producing cellulosic
feedstocks.
(b) Program.--The Secretary shall conduct a program of
research, development, demonstration, and commercial
application for bioenergy, including--
(1) biopower energy systems;
(2) biofuels;
(3) bio-based products;
(4) integrated biorefineries that may produce biopower,
biofuels, and bio-based products;
(5) cross-cutting research and development in feedstocks
and enzymes; and
(6) economic analysis.
(c) Biofuels and Bio-Based Products.--The goals of the
biofuels and bio-based products programs shall be to develop,
in partnership with industry--
(1) advanced biochemical and thermo-chemical conversion
technologies capable of making biofuels and biobased products
from a variety of feedstocks, including grains, cellulosic
biomass, and other agricultural byproducts, that are price-
competitive with gasoline or diesel in either internal
combustion engines or fuel cell-powered vehicles; and
(2) advanced biotechnology processes capable of making
biofuels and bio-based products with emphasis on development
of biorefinery technologies using enzyme-based processing
systems.
______

SA 1455. Ms. LANDRIEU submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 52, after line 22, add the following:

SEC. 115. EXTENSION OF DEEPWATER PORT ACT OF 1974 TO NATURAL
GAS LIQUIDS, LIQUEFIED PETROLEUM GASES, AND
CONDENSATES RECOVERED FROM NATURAL GAS.

Section 3(13) of the Deepwater Port Act of 1974 (33 U.S.C.
1502(13)) is amended--
(1) by striking ``including compressed'' and inserting
``including--
``(A) compressed''; and
(2) by adding at the end the following:
``(B) natural gas liquid, liquefied petroleum gas, and
condensate recovered from natural gas;''.
______

SA 1456. Ms. LANDRIEU submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 467, after line 16, add the following:

TITLE ____--MISCELLANEOUS

SEC. ____. DEEPWATER PORT LICENSING.

Section 6 of the Deepwater Port Act of 1974 (33 U.S.C.
1505) is amended by adding at the end the following:
``(d) Reliance on Activities of Other Agencies.--In
fulfilling the requirements of section 5(f)--
``(1) to the extent that other Federal agencies have
prepared environmental impact statements, are conducting
studies, or are monitoring the affected human, marine, or
coastal environment, the Secretary may use the information
derived from those activities in lieu of directly conducting
such activities; and
``(2) the Secretary may use information obtained from any
State or local government or from any person.''
______

SA 1457. Ms. LANDRIEU submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 467, after line 16, add the following:

TITLE ____--MISCELLANEOUS

SEC. ____. DEEPWATER PORT LICENSING.

Section 6 of the Deepwater Port Act of 1974 (33 U.S.C.
1505) is amended by adding at the end the following:

[[Page S10705]]

``(d) Reliance on Activities of Other Agencies.--In
fulfilling the requirements of section 5(f)--
``(1) to the extent that other Federal agencies have
prepared environmental impact statements, are conducting
studies, or are monitoring the affected human, marine, or
coastal environment, the Secretary may use the information
derived from those activities in lieu of directly conducting
such activities; and
``(2) the Secretary may use information obtained from any
State or local government or from any person.''
______

SA 1458. Ms. CANTWELL submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

Strike section 1182 and insert the following:

SEC. ____. MARKET-BASED RATES.

(a) Approval of Market-Based Rates.--Section 205 of the
Federal Power Act (16 U.S.C. 824d) is amended by adding at
the end the following:
``(h) Market-Based Rates.--
``(1) In general.--In determining whether to grant a public
utility authority to sell wholesale electric energy at a
market-based rate, the Commission shall consider--
``(A) whether the seller and affiliates of the seller have,
or have adequately mitigated, market power in the generation
and transmission of electric energy;
``(B) whether the sale is made in an effectively
competitive market;
``(C) whether market mechanisms function adequately;
``(D) the adequacy of reserve margins; and
``(E) such other matters as the Commission considers to be
appropriate and in the public interest.
``(2) Annual review.--
``(A) In general.--For each public utility granted the
authority by the Commission to sell wholesale electric energy
at a market-based rate, the Commission shall review, at least
annually, the characteristics of each market in which the
public utility is authorized to sell wholesale electric
energy at a market-based rate to determine whether sales by
the public utility in that market are subject to effective
competition.
``(B) Corrective action.--If, in a review under
subparagraph (A), the Commission determines that effective
competition does not exist, the Commission shall take
appropriate corrective action.''.
(b) Review of Market-Based Rates.--Section 206 of the
Federal Power Act (16 U.S.C. 824e) is amended by adding at
the end the following:
``(f) Market-Based Rules.--If the Commission, after a
hearing on its own motion or on complaint, finds that a rate
charged by a public utility authorized to charge a market-
based rate under section 205 is unjust, unreasonable, or
unduly discriminatory or preferential, the Commission shall--
``(1) determine the just and reasonable rate and fix the
rate by order in accordance with this section; or
``(2) order such other action as will, in the judgment of
the Commission, ensure a just and reasonable market-based
rate.''.
______

SA 1459. Ms. CANTWELL submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

Strike section 1172 and insert the following:

SEC. 1172. MARKET MANIPULATION.

(a) Prohibition.--Part II of the Federal Power Act (as
amended by section 1171) is amended by adding at the end the
following:

``SEC. 219. PROHIBITION ON MARKET MANIPULATION.

``It shall be unlawful for any person, directly or
indirectly, to use or employ, in connection with the purchase
or sale of electric energy or the purchase or sale of
transmission services subject to the jurisdiction of the
Commission, any manipulative or deceptive device or
contrivance in contravention of such regulations as the
Commission may promulgate as appropriate in the public
interest or for the protection of electric ratepayers.''.
(b) Rates Resulting From Market Manipulation.--Section
205(a) of the Federal Power Act (16 U.S.C. 824d(a)) is
amended by inserting after ``not just and reasonable'' the
following: ``or that result from a manipulative or deceptive
device or contrivance in violation of a regulation
promulgated under section 219''.
(c) Additional Remedy for Market Manipulation.--Section 206
of the Federal Power Act (16 U.S.C. 824e) is amended by
adding at the end the following:
``(e) Remedy for Market Manipulation.--If the Commission
finds that a public utility has knowingly employed any
manipulative or deceptive device or contrivance in violation
of a regulation promulgated under section 219, the Commission
shall, in addition to any other remedy available under this
Act, revoke the authority of the public utility to charge
market-based rates.''.
______

SA 1460. Ms. CANTWELL submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

Strike section 1182 and insert the following:

SEC. ____. PROHIBITION OF MARKET-BASED RATES.

Section 205(a) of the Federal Power Act (16 U.S.C. 824d(a))
is amended by adding at the end the following: ``Nothing in
this Act confers on the Commission authority to authorize
market-based rates for the sale of electric energy at
wholesale.''.
______

SA 1461. Ms. CANTWELL submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

In section 216 of the Federal Power Act (as added by
section 1131), strike subsection (f).
In section 218 of the Federal Power Act (as added by
section 1171), strike the second sentence of subsection (b).
______

SA 1462. Ms. CANTWELL submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of subtitle G, add the following:

SEC. 11____. RELIEF FOR RATEPAYERS.

Any contract for the sale of electric energy at wholesale
that contains rates, terms, or conditions affected by any
manipulative, deceptive, or fraudulent activity by a party to
the contract shall be unenforceable.
______

SA 1463. Ms. CANTWELL submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

Strike section 1132.
______

SA 1464. Ms. CANTWELL submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of subtitle G, add the following:

SEC. 11____. RELIEF FOR WESTERN RATEPAYERS.

Any contract for the sale of electric energy at wholesale
within the Western Systems Coordinating Council region that
was executed by Enron Corporation, Enron Power Marketing
Incorporated, Enron Energy Services Incorporated, Enron North
America, or the Enron Group during the period of December 25,
2000, through June 20, 2001, shall, for the purposes of
section 206 of the Federal Power Act (16 U.S.C. 824e), be
considered to be unjust and unreasonable and not in the
public interest.
______

SA 1465. Ms. CANTWELL submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end, add the following:

TITLE____--MISCELLANEOUS

SEC. ____. PROHIBITION OF LOBBYING FOR NOMINATIONS TO THE
FEDERAL ENERGY REGULATORY COMMISSION.

Part I of the Federal Power Act (16 U.S.C. 792 et seq.) is
amended by adding at the end the following:

``SEC. 33. PROHIBITION OF LOBBYING FOR NOMINATIONS TO THE
FEDERAL ENERGY REGULATORY COMMISSION.

``It shall be unlawful for any person that is an officer or
employee of, or has any financial relationship to, a licensee
under this Act or of any person, firm, association,
municipality, or corporation engaged in the generation,
transmission, distribution, or sale of natural gas or
electric power, to communicate with any officer or employee
of the executive or legislative branch of the Federal
Government with the intent of advancing--
``(1) the candidacy of a specific individual to be
nominated by the President to be a member of the Commission;
or
``(2) the confirmation by the Senate of such a
nomination.''.
______

SA 1466. Ms. CANTWELL submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end, add the following:

TITLE____--MISCELLANEOUS

SEC. ____. FERC RULES REGARDING EX PARTE COMMUNICATIONS.

(a) Existing Rule.--Section 385.2201 of title 18, United
States Code, is vacated.
(b) Standards of Conduct.--Part I of the Federal Power Act
is amended by inserting after the first section (16 U.S.C.
792) the following:

``SEC. 1A. STANDARDS OF CONDUCT.

``(a) Ex Parte Communications.--Unless required for the
disposition of ex parte matters authorized by law, members of
the commission or administrative law judges assigned to
render a decisions or to make findings of fact and
conclusions of law in a contested case may not communicate,
directly

[[Page S10706]]

or indirectly, in connection with any issue of law or fact
with any agency, person, party, or their representatives,
except on notice and opportunity for all parties to
participate. Members of the commission or administrative law
judges assigned to render a decision or to make findings of
fact or conclusions of law in a contested case may
communicate ex parte with employees of the commission who
have not participated in any hearing in the case for the
purpose of utilizing the special skills or knowledge of the
commission and its staff in evaluating the evidence.
``(b) Standards for Recusal of Commissioners.--A
commissioner shall recuse himself or herself from sitting in
a proceeding, or from deciding one or more issues in a
proceeding, in which any one or more of the following
circumstances exist:
``(1) the commissioner in fact lacks impartiality, or the
commissioner's impartiality has been reasonably questioned;
``(2) the commissioner, or any relative of the
commissioner, is a party or has a financial interest in the
subject matter of the issue or in one of the parties, or the
commissioner has any other interest that could be
substantially affected by the determination of the issue; or
``(3) the commissioner or a relative of the commissioner
has participated as counsel, advisor, or witness in the
proceeding or matter in controversy.
``(c) Motions for Disqualification or Recusal of a
Commissioner.--
``(1) Any party may move for disqualification or recusal of
a commissioner stating with particularity grounds why the
commissioner should not sit. Such a motion must be filed
prior to the date the commission is scheduled to consider the
matter unless the information upon which the motion is based
was not known or discoverable with reasonable effort prior to
that time. The grounds may include any disability or matter
not limited to those set forth in subsection (d) of this
section. The motion shall be made on personal knowledge,
shall set forth such facts as would be admissible in
evidence, and shall be verified by affidavit.
``(2) Subject to the provisions of paragraph (1) of this
subsection the motion shall be filed within 10 working days
after the facts that are the basis of the motion become know
to the party or within 15 days of the commencement of the
proceeding, whichever is later. The motion shall be served on
all parties by hand delivery, facsimile transmission, or
overnight courier delivery.
``(3) Parties may file written responses to the motion
within 7 working days from the date of filing the motion. The
commission may require that responses be made orally at an
open meeting.
``(4) The commissioner sought to be disqualified shall
issue a decision as to whether he or she agrees that recusal
or disqualification is appropriate or required before the
commission is scheduled to act on the matter for which
recusal is sought, or within 15 days after filing of the
motion, whichever occurs first.
``(5) The parties to a proceeding may waive any ground for
recusal or disqualification after it is fully disclosed on
the record, either expressly or by their failure to take
action on a timely basis.
``(6) Recusal or disqualification of a commission in and of
itself has no effect upon the validity of rulings made or
orders issued prior to the time the motion for recusal was
filed.''
______

SA 1467. Ms. CANTWELL submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table,
as follows:

At the end of subtitle B of Title VII, add the following:

``SEC. 7____. AVIATION EFFICIENCY.

``(a) Establishment.--The Secretary of Energy, in
cooperation with the Administrator of the National
Aeronautics and Space Administration, Administrator of the
Environmental Protection Agency and, where applicable, the
Secretary of Defense, shall establish a cost-shared public-
private research partnership to develop and demonstrate
aviation-related technologies, including fuel cell
technology, that increase fuel efficiency, reduce emissions
and lower costs of operation. Such partnership shall involve
the Federal Government, commercial airlines, universities,
and aviation manufacturers and equipment suppliers.
``(b) Authorization of Appropriations.--For the purposes of
this section, there are authorized to be appropriated to the
Secretary of Energy $50,000,000 for fiscal year 2004,
$70,000,000 for fiscal year 2005, and $100,000,000 for fiscal
year 2006.''
______

SA 1468. Ms. CANTWELL submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At an appropriate place in the bill, add the following:

``SEC.  . COST RECOVERY FOR QUALIFIED ENERGY MANAGEMENT
DEVICES AND QUALIFIED ENERGY MANAGEMENT
SOFTWARE.

(a) Qualified Energy Management Device Defined as 3-Year
Property.--Section 168(e)(3)(A) (defining 3-year property) 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 new clause:
``(iv) any qualified energy management device.

Nothing in any other provision of this title shall be
construed to treat property as not being described in clause
(iv) by reason of its use in connection with public utility
property (within the meaning of subsection (i)(9)).''.
(b) Definition of Qualified Energy Management Device.--
Section 168(i) (relating to definitions and special rules) is
amended by inserting at the end the following new paragraph:
``(15) Qualified energy management device--
``(A) In general.--The term ``qualified energy management
device'' means any energy management device which is placed
in service before January 1, 2008, by a taxpayer who is a
supplier of electric energy or a provider of electric energy
services.
``(B) Energy management device.--For purposes of
subparagraph (A), the term ``energy management device'' means
any meter or metering device which is used by the taxpayer--
``(i) to measure and record electricity usage data on a
time-differentiated basis in at least 4 separate time
segments per day, and
``(ii) to provide such data on at least a monthly basis to
both consumers and the taxpayer.''.
(c) Expensing of Qualified Energy Management Software.--
Section 167 is amended by redesignating subsection (h) as
subsection (i) and adding the following new subsection:
``(h) Treatment of Qualified Energy Management Software.--
``(1) In general.--There shall be allowed as a deduction an
amount equal to the cost of qualified energy management
software placed in service during the taxable year and before
January 1, 2008.
``(2) Qualified energy management software.--For purposes
of this subsection, qualified energy management software is
computer software (as described in subsection (f)(1)(B)) for
which a depreciation deduction would be allowable (but for
this subsection) under subsection (a), and which is used by
the taxpayer primarily--
``(i) to collect electricity usage data from one or more
qualified energy management devices (as defined in section
168(i)(15)),
``(ii) to present or display to the consumer electricity
usage data collected by such devices, or
``(iii) to manage or control a consumer's electricity load.
``(3) Basis reduction.--For purposes of this title, the
basis of any property shall be reduced by the amount of the
deduction with respect to such property which is allowed by
paragraph (1).
``(4) Certain regulated companies--This subsection shall
not apply to any qualified energy management software that is
public utility property (within the meaning of section
168(i)(10)) if the taxpayer does not use a normalization
method of accounting (within the meaning of section
168(i)(9)).''
(d) Conforming Amendments--
(1) Section 263(a)(1) is amended by striking `or' at the
end of subparagraph (G), by striking the period at the end of
subparagraph (H) and inserting `, or', and by inserting after
subparagraph (H) the following new subparagraph:
``(i) expenditures for which a deduction is allowed under
section 167(h)(1).''.
(2) Section 1016(a) is amended by striking ``and'' at the
end of paragraph (27), by striking the period at the end of
paragraph (28) and inserting ``, and'', and by inserting
after paragraph (28) the following new paragraph:
``(29) to the extent provided in section 167(h)(1).''
(3) Section 1245(a) is amended by inserting ``167(h)(1),''
before ``179,'' both places it appears in paragraphs (2)(C)
and (3)(C).
(e) Effective Date.--The amendments made by this section
shall apply to property placed in service after the date of
the enactment of this Act, in taxable years ending after such
date.''
______

SA 1469. Ms. CANTWELL submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At an appropriate place in the bill, add the following:

SEC.   . DEFINITIONS.

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

[[Page S10707]]

(3) Fund.--The term `Fund' means the ``Savings Through
Energy Productivity (STEP) Fund'' established by section 4.
(4) Secretary.--The term `Secretary' means the Secretary of
Energy.
(5) Utility.--The term `utility' means an electric utility
(as defined in section 3 of the Federal Power Act (16 U.S.C.
796)) that is subject to regulation by a State commission (as
defined in that section).

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

(a) In General.--The Secretary shall establish a program,
to be known as the `STEP Emergency Rebate Program', under
which the Secretary makes grants to eligible utilities to pay
the costs of providing rebates or credits against the amounts
of electric bills of customers that reduce the amount of
electric energy consumed by the customer.
(b) Credits For Reduction of Electric Energy Consumption.--
(1) In general.--To receive a grant under subsection (a),
an eligible utility shall agree to provide its customers
rebates and credits as provided in this subsection.
(2) First period of qualification.--During the first 12-
month period in which a utility customer qualifies for
rebates or credits under this section, the customer shall be
entitled to a rebate of a portion of the amount of an
electric bill paid, or a credit against the amount of an
electric bill, for each billing period, in an amount that is
proportionate to the percentage by which the amount of
electric energy consumed by the customer during the billing
period is less than the amount consumed during the equivalent
billing period in the preceding year (referred to in this
section as the `base billing period').
(3) Second period of qualification.--During the second 12-
month period in which a utility customer qualifies for
rebates or credits under this section, the customer shall be
entitled to a rebate of a portion of the amount of an
electric bill paid, or a credit against the amount of an
electric bill, for each billing period, in an amount that is
proportionate to the percentage by which the amount of
electric energy consumed by the customer during the billing
period is less than the amount consumed during the base
billing period.
(4) New customers.--In the case of a customer to which an
eligible utility has sold electric energy for less than a
year, the proportion by which the customer shall be
considered to have reduced electric energy consumption during
a month shall be determined by comparing the amount of
electric energy consumed by the customer during the month
against a local area baseline determined in accordance with
regulations promulgated by the Secretary.
(5) Percentage reduction.--
(A) Limitation.--A utility customer shall be entitled to a
rebate or credit only to the extent that the percentage
described in paragraph (3) or (4) is between 5.0 percent and
20.0 percent, inclusive.
(B) Rounding.--For the purposes of determining the amount
of a rebate or credit, a described in paragraph (3) or (4)
shall be rounded to the nearest tenth of a percent.
(c) Action By the Secretary.--
(1) Expeditious relief.--In order to provide energy cost
relief to consumers as expeditiously as possible, the
Secretary shall act on an application for a grant under
subsection (a) within 30 days after receiving the
application.
(2) Failure to act.--If the Secretary fails to act on an
application for a grant within 30 days after receiving the
application, the application shall be deemed to be granted.
(3) Denial of application.--If the Secretary denies an
application, the Secretary shall include in the denial.--
(A) a detailed statement of the reasons for the denial; and
(B) a description any action that the applicant may make to
obtain approval of the application.
(d) Authorization of Appropriations.--
(1) In general.--There are authorized to be appropriated
such sums as are necessary to carry out this section for
fiscal years 2004 and 2005.
(2) Administrative expenses.--The Secretary shall use not
more than 5 percent of the amount made available to carry out
this section for a fiscal year to pay administrative
expenses.
(e) Cessation of Effectiveness.--
(1) In general.--This section ceases to be in effect on
October 1, 2005.
(2) Transfer to the fund.--Any balance of the amounts made
available to carry out this section that remain unexpended on
September 30, 2005, shall be transferred to the Fund.

SEC. 4. STEP FUND.

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

SA 1470. Ms. CANTWELL (for herself and Mr. Schumer) submitted an
amendment intended to be proposed by her to the bill S. 14, to enhance
the energy security of the United States, and for other purposes; which
was ordered to lie on the table; as follows:

At the end of subtitle B of Title VII, add the following:

SEC. 7__. MOTOR VEHICLE TIRES SUPPORTING MAXIMUM FUEL
EFFICIENCY.

(a) Standards for Tires Manufactured for Interstate
Commerce.--Section 30123 of title 49, United States Code, is
amended--
(1) in subsection (b), by inserting after the first
sentence the following: ``The grading system shall include
standards for rating the fuel efficiency of tires designed
for use on passenger cars and light trucks.''; and
(2) by adding at the end the following:
``(d) National Tire Fuel Efficiency Program.--(1) The
Secretary shall develop and carry out a national tire fuel
efficiency program for tires designed for use on passenger
cars and light trucks.
``(2) The program shall include the following:
``(A) Policies and procedures for testing and labeling
tires for fuel economy to enable tire buyers to make informed
purchasing decisions about the fuel economy of tires.
``(B) Policies and procedures to promote the purchase of
energy-efficient replacement tires, including purchase
incentives, website listings on the Internet, printed fuel
economy guide booklets, and mandatory requirements for tire
retailers to provide tire buyers with fuel-efficiency
information on tires.
``(C) Minimum fuel economy standards for tires, promulgated
by the Secretary.
``(3) The minimum fuel economy standards for tires shall--
``(A) ensure that the fuel economy of replacement tires is
equal to or better than the average fuel economy of tires
sold as original equipment;
``(B) secure the maximum technically feasible and cost-
effective fuel savings;
``(C) not adversely affect tire safety;
``(D) not adversely affect the average tire life of
replacement tires;
``(E) incorporate the results from--
``(i) laboratory testing; and
``(ii) to the extent appropriate and available, on-road
fleet testing programs conducted by the manufacturers; and
``(F) not adversely affect efforts to manage scrap tires.
``(4) The policies, procedures, and standards developed
under paragraph (2) shall apply to all types and models of
tires that are covered by the uniform tire quality grading
standards under section 575.104 of title 49, Code 16 of
Federal Regulations (or any successor regulation).
``(5) Not less often than every three years, the Secretary
shall review the minimum fuel economy standards in effect for
tires under this subsection and revise the standards as
necessary to ensure compliance with requirements under
paragraph (3). The Secretary

[[Page S10708]]

may not, however, reduce the average fuel economy standards
applicable to replacement tires.
``(6) Nothing in this chapter shall be construed to preempt
any provision of State law relating to higher fuel economy
standards applicable to replacement tires designed for use on
passenger cars and light trucks.
``(7) Nothing in this chapter shall apply to--
``(A) a tire or group of tires with the same SKU, plant,
and year, for which the volume of tires produced or imported
is less than 15,000 annually;
``(B) a deep tread, winter-type snow tire, spacesaver tire,
or temporary use spare tire;
``(C) a tire with a normal rim diameter of 12 inches or
less;
``(D) a motorcycle tire; or
``(E) a tire manufactured specifically for use in an off-
road motorized recreational vehicle.
``(8) In this subsection, the term `fuel economy', with
respect to tires, means the extent to which the tires
contribute to the fuel economy of the motor vehicles on which
the tires are mounted.
(b) Conforming Amendment.--Section 30103(b) of title 49,
United States Code, is amended in paragraph (1) by striking
``When'' and inserting ``Except as provided in section
30123(d) of this title, when''.
(c) Time for Implementation.--The Secretary of
Transportation shall ensure that the national tire fuel
efficiency program required under subsection (d) of section
30123 of title 49, United States Code (as added by subsection
(a)(2)), is administered so as to apply the policies,
procedures, and standards developed under paragraph (2) of
such subsection (d) beginning not later than March 31, 2006.
______

SA 1471. Ms. CANTWELL submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

Strike section 1141 and insert the following:

SEC. 1141. NET METERING.

(a) Adoption of Standard.--Section 111(d) of the Public
Utility Regulatory Policies Act of 1978 (16 U.S.C. 2621(d))
is amended by adding at the end the following:
``(11) Net metering.--
``(A) In general.--On the request of any electric consumer
served by an electric utility, the electric utility shall
make available to the electric consumer net metering as
provided in section 115(i).
``(B) Consideration by state regulatory authorities.--
Notwithstanding subsections (b) and (c) of section 112, not
later than 1 year after the date of enactment of this
paragraph, a State regulatory authority may consider and make
a determination concerning whether it is in the public
interest to decline to implement subparagraph (A) in the
State.
``(C) Incentives.--Nothing in this paragraph precludes a
State from establishing incentives to encourage on-site
generating facilities and net metering in addition to the
requirement under this subsection.
``(D) Reports.--Not later than 1 year after the date of
enactment of this paragraph and annually thereafter, the
Secretary shall submit to Congress a report that--
``(i) describes the status of implementation by the States
of subparagraph (A);
``(ii) contains a list of pre-approved systems and
equipment eligible for uniform interconnection treatment; and
``(iii) describes the public benefits that have been
derived from net metering and interconnection standards.''.
(b) Special Rules for Net Metering.--Section 115 of the
Public Utility Regulatory Policies Act of 1978 (16 U.S.C.
2625) is amended by adding at the end the following:
``(i) Net Metering.--
``(1) Definitions.--In this subsection:
``(A) Eligible on-site generating facility.--The term
`eligible on-site generating facility' means--
``(i) a facility on the site of a residential electric
consumer with a maximum generating capacity of 25 kilowatts
or less that is fueled by solar energy, wind energy, or fuel
cells; and
``(ii) a facility on the site of a commercial electric
consumer with a maximum generating capacity of 1000 kilowatts
or less that is fueled solely by a renewable energy resource,
landfill gas, or a high-efficiency system.
``(B) High efficiency system.--The term `high efficiency
system' means a system that is comprised of--
``(i) fuel cells; or
``(ii) combined heat and power.
``(C) Net metering service.--The term `net metering
service' means service to an electric consumer, as provided
in section 111(d)(11), under which electric energy generated
by that electric consumer from an eligible on-site generating
facility and delivered to the local distribution facilities
may be used to offset electric energy provided by the
electric utility to the electric consumer during the
applicable billing period.
``(D) Renewable energy resource.--The term `renewable
energy resource' means solar, wind, biomass, micro-freeflow-
hydro, or geothermal energy.
``(2) Net metering service.--For the purposes of
undertaking the consideration and making the determination
with respect to the standard concerning net metering
established by section 111(d)(11), the term `net metering
service' means a service provided in accordance with this
subsection.
``(3) Charges by an electric utility.--An electric
utility--
``(A) shall charge the owner or operator of an on-site
generating facility rates and charges that are identical to
those that would be charged other electric consumers of the
electric utility in the same rate class; and
``(B) shall not charge the owner or operator of an on-site
generating facility any additional standby, capacity,
interconnection, or other rate or charge.
``(4) Measurement of quantities.--An electric utility that
sells electric energy to the owner or operator of an on-site
generating facility shall measure the quantity of electric
energy produced by the on-site facility and the quantity of
electric energy consumed by the owner or operator of an on-
site generating facility during a billing period with a
single bi-directional meter or otherwise in accordance with
reasonable metering practices.
``(5) Quantity sold in excess of quantity supplied.--If the
quantity of electric energy sold by the electric utility to
an on-site generating facility exceeds the quantity of
electric energy supplied by the on-site generating facility
to the electric utility during the billing period, the
electric utility may bill the owner or operator for the net
quantity of electric energy sold, in accordance with
reasonable metering practices.
``(6) Quantity supplied in excess of quantity sold.--If the
quantity of electric energy supplied by the on-site
generating facility to the electric utility exceeds the
quantity of electric energy sold by the electric utility to
the on-site generating facility during the billing period--
``(A) the electric utility may bill the owner or operator
of the on-site generating facility for the appropriate
charges for the billing period in accordance with paragraph
(5); and
``(B) the owner or operator of the on-site generating
facility shall be credited for the excess kilowatt-hours
generated during the billing period with--
``(i) a kilowatt-hour credit appearing on the bill for the
following billing period; or
``(ii) a cash refund.
``(7) Compliance with standards.--An eligible on-site
generating facility and net metering system used by an
electric consumer shall meet all applicable safety,
performance, reliability, and interconnection standards
established by the National Electrical Code, the Institute of
Electrical and Electronics Engineers, and Underwriters
Laboratories.
``(8) Requirements.-- The Commission, after consideration
of all applicable safety, performance, reliability, and
interconnection standards established by the National
Electrical Code, the Institute of Electrical and Electronics
Engineers, and Underwriters Laboratories, and consultation
with State regulatory authorities and unregulated electric
utilities, and after notice and opportunity for comment,
shall promulgate additional control, testing, and
interconnection requirements for on-site generating
facilities and net metering systems that the Commission
determines are necessary to protect public safety and system
reliability.''.
______

SA 1472. Ms. CANTWELL submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

Strike subtitle F of Title IX and insert the following:

SEC. 961. SCIENCE.

(a) In General.--The following sums are authorized to be
appropriated to the Secretary for research, development,
demonstration, and commercial application activities of the
Office of Science, including activities authorized under this
subtitle, including the amounts authorized under the
amendment made by section 967(c)(2)(D), and including basic
energy sciences, advanced scientific and computing research,
biological and environmental research, fusion energy
sciences, high energy physics, nuclear physics, and research
analysis and infrastructure support--
(1) for fiscal year 2004, $3,785,000,000;
(2) for fiscal year 2005, $4,153,000,000;
(3) for fiscal year 2006, $4,586,000,000;
(4) for fiscal year 2007, $5,000,000,000; and
(5) for fiscal year 2008, $5,400,000,000.
(b) Allocations.--From amounts authorized under subsection
(a), the following sums are authorized:
(1) For activities of the Fusion Energy Sciences Program,
including activities under section 962--
(A) for fiscal year 2004, $335,000,000;
(B) for fiscal year 2005, $349,000,000;
(C) for fiscal year 2006, $362,000,000;
(D) for fiscal year 2007, $377,000,000; and
(E) for fiscal year 2008, $393,000,000.
(2) For the Spallation Neutron Source--
(A) for construction in fiscal year 2004, $124,600,000;
(B) for construction in fiscal year 2005, $79,800,000;
(C) for completion of construction in fiscal year 2006,
$41,100,000; and
(D) for other project costs (including research and
development necessary to complete the project, preoperations
costs, and capital equipment related to construction),
$103,279,000 for the period encompassing fiscal years 2003
through 2006, to remain available until expended through
September 30, 2006.

[[Page S10709]]

(3) For Catalysis Research activities under section 965--
(A) for fiscal year 2004, $33,000,000;
(B) for fiscal year 2005, $35,000,000;
(C) for fiscal year 2006, $36,500,000;
(D) for fiscal year 2007, $38,200,000; and
(E) for fiscal year 2008, $40,100,000.
(4) For Nanoscale Science and Engineering Research
activities under section 966--
(A) for fiscal year 2004, $270,000,000;
(B) for fiscal year 2005, $290,000,000;
(C) for fiscal year 2006, $310,000,000;
(D) for fiscal year 2007, $330,000,000; and
(E) for fiscal year 2008, $375,000,000.
(5) For activities under subsection 966(c), from the
amounts authorized under subparagraph (4)--
(A) for fiscal year 2004, $135,000,000;
(B) for fiscal year 2005, $150,000,000;
(C) for fiscal year 2006, $120,000,000;
(D) for fiscal year 2007, $100,000,000; and
(E) for fiscal year 2008, $125,000,000.
(6) For activities in the Genomes to Life Program under
section 968--
(A) for fiscal year 2004, $100,000,000;
(B) for fiscal year 2005, $170,000,000;
(C) for fiscal year 2006, $325,000,000;
(D) for fiscal year 2007, $415,000,000; and
(E) for fiscal year 2008, $455,000,000.
(7) For construction and ancillary equipment of the Genomes
to Life User Facilities under section 968(d), of funds
authorized under (6)--
(A) for fiscal year 2004, $16,000,000;
(B) for fiscal year 2005, $70,000,000;
(C) for fiscal year 2006, $175,000,000;
(D) for fiscal year 2007, $215,000,000; and
(E) for fiscal year 2008, $205,000,000.
(8) For activities in the Water Supply Technologies Program
under section 970, $30,000,000 for each of fiscal years 2004
through 2008.
(c) In addition to the funds authorized under subsection
(b)(1), the following sums are authorized for construction
costs associated with the ITER project under section 962--
(1) for fiscal year 2006, $55,000,000;
(2) for fiscal year 2007, $95,000,000; and
(3) for fiscal year 2008, $115,000,000.
(d)(1) In addition to the funds authorized under subsection
(b)(1), there are authorized to be appropriated to the
Secretary, for crosscutting programs under section 968(e),
$25,000,000 for each of fiscal years 2004 through 2008.
(2) From the sums authorized in paragraph (1), at least one
consortium under section 968(e) shall be provided with not
less than $10,000,000 in each fiscal year.

SEC. 962. UNITED STATES PARTICIPATION IN ITER.

(a) Participation.--
(1) The Secretary of Energy is authorized to undertake full
scientific and technological cooperation in the International
Thermonuclear Experimental Reactor project (referred to in
this title as ``ITER'').
(2) In the event that ITER fails to go forward within a
reasonable period of time, the Secretary shall send to
Congress a plan, including costs and schedules, for
implementing the domestic burning plasma experiment known as
the Fusion Ignition Research Experiment. Such a plan shall be
developed with full consultation with the Fusion Energy
Sciences Advisory Committee and be reviewed by the National
Research Council.
(3) It is the intent of Congress that such sums shall be
largely for work performed in the United States and that such
work contributes the maximum amount possible to the U.S.
scientific and technological base.
(b) Planning.--
(1) Not later than 180 days of the date of enactment of
this act, the Secretary shall present to Congress a plan,
with proposed cost estimates, budgets and potential
international partners, for the implementation of the goals
of this section. The plan shall ensure that--
(A) existing fusion research facilities are more fully
utilized;
(B) fusion science, technology, theory, advanced
computation, modeling and simulation are strengthened;
(C) new magnetic and inertial fusion research facilities
are selected based on scientific innovation, cost
effectiveness, and their potential to advance the goal of
practical fusion energy at the earliest date possible, and
those that are selected are funded at a cost-effective rate;
(D) communication of scientific results and methods between
the fusion energy science community and the broader
scientific and technology communities is improved;
(E) inertial confinement fusion facilities are utilized to
the extent practicable for the purpose of inertial fusion
energy research and development; and
(F) attractive alternative inertial and magnetic fusion
energy approaches are more fully explored.
(2) Such plan shall also address the status of and, to the
degree possible, costs and schedules for--
(A) in coordination with the program in section 969, the
design and implementation of international or national
facilities for the testing of fusion materials; and
(B) the design and implementation of international or
national facilities for the testing and development of key
fusion technologies.

SEC. 963. SPALLATION NEUTRON SOURCE.

(a) Definition.--For the purposes of this section, the term
``Spallation Neutron Source'' means Department Project 9909E
09334, Oak Ridge National Laboratory, Oak Ridge, Tennessee.
(b) Report.--The Secretary shall report on the Spallation
Neutron Source as part of the Department's annual budget
submission, including a description of the achievement of
milestones, a comparison of actual costs to estimated costs,
and any changes in estimated project costs or schedule.
(c) Authorization of Appropriations.--The total amount
obligated by the Department, including prior year
appropriations, for the Spallation Neutron Source may not
exceed--
(1) $1,192,700,000 for costs of construction;
(2) $219,000,000 for other project costs; and
(3) $1,411,700,000 for total project cost.

SEC. 964. SUPPORT FOR SCIENCE AND ENERGY FACILITIES AND
INFRASTRUCTURE.

(a) Facility and Infrastructure Policy.--The Secretary
shall develop and implement a strategy for facilities and
infrastructure supported primarily from the Office of
Science, the Office of Energy Efficiency and Renewable
Energy, the Office of Fossil Energy, or the Office of Nuclear
Energy, Science and Technology Programs at all national
laboratories and single-purpose research facilities. Such
strategy shall provide cost-effective means for--
(1) maintaining existing facilities and infrastructure, as
needed;
(2) closing unneeded facilities;
(3) making facility modifications; and
(4) building new facilities.
(b) Report.--
(1) The Secretary shall prepare and transmit, along with
the President's budget request to the Congress for fiscal
year 2006, a report containing the strategy developed under
subsection (a).
(2) For each national laboratory and single-purpose
research facility, for the facilities primarily used for
science and energy research, such report shall contain--
(A) the current priority list of proposed facilities and
infrastructure projects, including cost and schedule
requirements;
(B) a current ten-year plan that demonstrates the
reconfiguration of its facilities and infrastructure to meet
its missions and to address its long-term operational costs
and return on investment;
(C) the total current budget for all facilities and
infrastructure funding; and
(D) the current status of each facility and infrastructure
project compared to the original baseline cost, schedule, and
scope.

SEC. 965. CATALYSIS RESEARCH PROGRAM.

(a) Establishment.--The Secretary, through the Office of
Science, shall support a program of research and development
in catalysis science consistent with the Department's
statutory authorities related to research and development.
The program shall include efforts to--
(1) enable catalyst design using combinations of
experimental and mechanistic methodologies coupled with
computational modeling of catalytic reactions at the
molecular level;
(2) develop techniques for high throughput synthesis,
assay, and characterization at nanometer and sub-nanometer
scales in situ under actual operating conditions;
(3) synthesize catalysts with specific site architectures;
(4) conduct research on the use of precious metals for
catalysis; and
(5) translate molecular understanding to the design of
catalytic compounds.
(b) Duties of the Office of Science.--In carrying out this
program, the Director of the Office of Science shall--
(1) support both individual investigators and
multidisciplinary teams of investigators to pioneer new
approaches in catalytic design;
(2) develop, plan, construct, acquire, share, or operate
special equipment or facilities for the use of investigators
in collaboration with national user facilities such as
nanoscience and engineering centers;
(3) support technology transfer activities to benefit
industry and other users of catalysis science and
engineering; and
(4) coordinate research and development activities with
industry and other federal agencies.
(c) Triennial Assessment.--The National Academy of Sciences
shall review the catalysis program every three years to
report on gains made in the fundamental science of catalysis
and its progress towards developing new fuels for energy
production and material fabrication processes.

SEC. 966. NANOSCALE SCIENCE AND ENGINEERING RESEARCH.

(a) Establishment.--The Secretary, acting through the
Office of Science, shall support a program of research,
development, demonstration, and commercial application in
nanoscience and nanoengineering. The program shall include
efforts to further the understanding of the chemistry,
physics, materials science, and engineering of phenomena on
the scale of nanometers and to apply this knowledge to the
Department's mission areas.
(b) Duties of the Office of Science.--In carrying out the
program under this section, the Office of Science shall--
(1) support both individual investigators and teams of
investigators, including multidisciplinary teams;
(2) carry out activities under subsection (c);
(3) support technology transfer activities to benefit
industry and other users of nanoscience and nanoengineering;
and
(4) coordinate research and development activities with
other DOE programs, industry and other Federal agencies.

[[Page S10710]]

(c) Nanoscience and Nanoengineering Research Centers and
Major Instrumentation.--
(1) The Secretary shall carry out projects to develop,
plan, construct, acquire, operate, or support special
equipment, instrumentation, or facilities for investigators
conducting research and development in nanoscience and
nanoengineering.
(2) Projects under paragraph (1) may include the
measurement of properties at the scale of nanometers,
manipulation at such scales, and the integration of
technologies based on nanoscience or nanoengineering into
bulk materials or other technologies.
(3) Facilities under paragraph (1) may include electron
microcharacterization facilities, microlithography
facilities, scanning probe facilities, and related
instrumentation.
(4) The Secretary shall encourage collaborations among DOE
programs, institutions of higher education, laboratories, and
industry at facilities under this subsection.

SEC. 967. ADVANCED SCIENTIFIC COMPUTING FOR ENERGY MISSIONS.

(a) In General.--The Secretary, acting through the Office
of Science, shall support a program to advance the Nation's
computing capability across a diverse set of grand challenge,
computationally based, science problems related to
departmental missions.
(b) Duties of the Office of Science.--In carrying out the
program under this section, the Office of Science shall--
(1) advance basic science through computation by developing
software to solve grand challenge science problems on new
generations of computing platforms in collaboration with
other DOE program offices;
(2) enhance the foundations for scientific computing by
developing the basic mathematical and computing systems
software needed to take full advantage of the computing
capabilities of computers with peak speeds of 100 teraflops
or more, some of which may be unique to the scientific
problem of interest;
(3) enhance national collaboratory and networking
capabilities by developing software to integrate
geographically separated researchers into effective research
teams and to facilitate access to and movement and analysis
of large (petabyte) data sets;
(4) maintain a robust scientific computing hardware
infrastructure to ensure that the computing resources needed
to address departmental missions are available; and
(5) explore new computing approaches and technologies that
promise to advance scientific computing including
developments in quantum computing.
(c) High-Performance Computing Act of 1991 Amendments.--The
High-Performance Computing Act of 1991 is amended--
(1) in section 4 (15 U.S.C. 5503)--
(A) in paragraph (3) by striking ``means'' and inserting
and `networking and information technology' mean'', and by
striking ``(including vector supercomputers and large scale
parallel systems)''; and
(B) in paragraph (4), by striking ``packet switched''; and
(2) in section 203 (15 U.S.C. 5523)--
(A) in subsection (a), by striking all after ``As part of
the'' and inserting: ``Networking and Information Technology
Research and Development Program, the Secretary of Energy
shall conduct basic and applied research in networking and
information technology, with emphasis on supporting
fundamental research in the physical sciences and
engineering, and energy applications; providing supercomputer
access and advanced communication capabilities and facilities
to scientific researchers; and developing tools for
distributed scientific collaboration.'';
(B) in subsection (b), by striking ``Program'' and
inserting ``Networking and Information Technology Research
and Development Program''; and
(C) by amending subsection (e) to read as follows:
(e) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary of Energy to carry out
the Networking and Information Technology Research and
Development Program such sums as may be necessary for fiscal
years 2004 through 2008.''.
(d) Coordination.--The Secretary shall ensure that the
program under this section is integrated and consistent
with--
(1) the Accelerated Strategic Computing Initiative of the
National Nuclear Security Administration; and
(2) other national efforts related to advanced scientific
computing for science and engineering.

SEC. 968. GENOMES TO LIFE PROGRAM.

(a) Establishment.--The Secretary shall carry out a program
of research, development, demonstration, and commercial
application, to be known as the Genomes to Life Program, in
systems biology and proteomics consistent with the
Department's statutory authorities.
(b) Planning.--
(1) The Secretary shall prepare a program plan describing
how knowledge and capabilities would be developed by the
program and applied to Department missions relating to energy
security, environmental cleanup, and national security.
(2) The program plan will be developed in consultation with
other relevant Department technology programs.
(3) The program plan shall focus science and technology on
long-term goals, including--
(A) contributing to U.S. independence from foreign energy
sources, including production of hydrogen;
(B) converting carbon dioxide to organic carbon;
(C) advancing environmental cleanup;
(D) providing the science and technology for new
biotechnology industries; and
(E) improving national security and combating bioterrorism.
(4) The program plan shall establish specific short-term
goals and update these goals with the Secretary's annual
budget submission.
(c) Program Execution.--In carrying out the program under
this Act, the Secretary shall--
(1) support individual investigators and multidisciplinary
teams of investigators;
(2) subject to subsection (d), develop, plan, construct,
acquire, or operate special equipment or facilities for the
use of investigators conducting research, development,
demonstration, or commercial application in systems biology
and proteomics;
(3) support technology transfer activities to benefit
industry and other users of systems biology and proteomics;
and
(4) coordinate activities by the Department with industry
and other federal agencies.
(d) Genomes to Life User Facilities and Ancillary
Equipment.--
(1) Within the funds authorized to be appropriated pursuant
to this Act, the amounts specified under section 961(b)(7)
shall, subject to appropriations, be available for projects
to develop, plan, construct, acquire, or operate special
equipment, instrumentation, or facilities for investigators
conducting research, development, demonstration, and
commercial application in systems biology and proteomics and
associated biological disciplines.
(2) Projects under paragraph (1) may include--
(A) the identification and characterization of multiprotein
complexes;
(B) characterization of gene regulatory networks;
(C) characterization of the functional repertoire of
complex microbial communities in their natural environments
at the molecular level; and
(D) development of computational methods and capabilities
to advance understanding of complex biological systems and
predict their behavior.
(3) Facilities under paragraph (1) may include facilities,
equipment, or instrumentation for--
(A) the production and characterization of proteins;
(B) whole proteome analysis;
(C) characterization and imaging of molecular machines; and
(D) analysis and modeling of cellular systems.
(4) The Secretary shall encourage collaborations among
universities, laboratories and industry at facilities under
this subsection. All facilities under this subsection shall
have a specific mission of technology transfer to other
institutions.
(e) Crosscutting Research with Nanotechnology Programs.--
The Secretary shall support one or more consortia to
integrate nanotechnology and microfluidic tools with research
and development in genomics, systems biology, immunology, and
molecular imaging.

SEC. 969. FISSION AND FUSION ENERGY MATERIALS RESEARCH
PROGRAM.

In the President's fiscal year 2006 budget request, the
Secretary shall establish a research and development program
on material science issues presented by advanced fission
reactors and the Department's fusion energy program. The
program shall develop a catalog of material properties
required for these applications, develop theoretical models
for materials possessing the required properties, benchmark
models against existing data, and develop a roadmap to guide
further research and development in this area.

SEC. 970. ENERGY-WATER SUPPLY TECHNOLOGIES PROGRAM.

(a) Establishment.--There is established within the Office
of Science, Office of Biological and Environmental Research,
the ``Energy-Water Supply Technologies Program,'' to study
energy-related issues associated with water resources and
municipal waterworks and to study water supply issues related
to energy production.
(b) Definitions.--
(1) The term ``Foundation'' means the American Water Works
Association Research Foundation.
(2) The term ``Indian tribe'' has the meaning given the
term in section 4 of the Indian Self-Determination and
Education Assistance Act (25 U.S.C. 450b).
(3) The term ``Program'' means the Water Supply
Technologies Program established by section 970(a).
(c) Program Areas.--The program shall conduct research and
development, including--
(1) arsenic removal under subsection (d);
(2) desalination research program under subsection (e);
(3) the water and energy sustainability program under
subsection (f); and
(4) other energy-intensive water supply and treatment
technologies and other technologies selected by the
Secretary.
(d) Arsenic Removal Program.--
(1) As soon as practicable after the date of enactment of
this Act, the Secretary shall enter into a contract with the
Foundation to utilize the facilities, institutions and
relationships established in the ``Consolidated
Appropriations Resolution, 2003'' as described in Senate
Report 107-220 that will

[[Page S10711]]

carry out a research program to develop and demonstrate
innovative arsenic removal technologies.
(2) In carrying out the arsenic removal program, the
Foundation shall, to the maximum extent practicable, conduct
research on means of--
(A) reducing energy costs incurred in using arsenic removal
technologies;
(B) minimizing materials, operating, and maintenance costs
incurred in using arsenic removal technologies; and
(C) minimizing any quantities of waste (especially
hazardous waste) that result from use of arsenic removal
technologies.
(3) The Foundation shall carry out peer-reviewed research
and demonstration projects to develop and demonstrate water
purification technologies.
(4) In carrying out the arsenic removal program--
(A) demonstration projects will be implemented with
municipal water system partners to demonstrate the
applicability of innovative arsenic removal technologies in
areas with different water chemistries representative of
areas across the United States with arsenic levels near or
exceeding EPA guidelines; and
(B) not less than 40 percent of the funds of the Department
used for demonstration projects under the arsenic removal
program shall be expended on projects focused on needs of and
in partnership with rural communities or Indian tribes.
(5) The Foundation shall develop evaluations of cost
effectiveness of arsenic removal technologies used in the
program and an education, training, and technology transfer
component for the program.
(6) The Secretary shall consult with the Administrator of
the Environmental Protection Agency to ensure that activities
under the arsenic removal program are coordinated with
appropriate programs of the Environmental Protection Agency
and other federal agencies, state programs and academia.
(7) Not later than 1 year after the date of commencement of
the arsenic removal program, and annually thereafter, the
Secretary shall submit to Congress a report on the results of
the arsenic removal program.
(e) Desalination Program.--
(1) The Secretary, in cooperation with the Commissioner of
Reclamation, shall carry out a desalination research program
in accordance with the desalination technology progress plan
developed in Title II of the Energy and Water Development
Appropriations Act, 2002 (115 Stat. 498), and described in
Senate Report 107-39 under the heading ``WATER AND RELATED
RESOURCES'' in the ``BUREAU OF RECLAMATION'' section.
(2) The desalination program shall--
(A) draw on the national laboratory partnership established
with the Bureau of Reclamation to develop the January 2003
national Desalination and Water Purification Technology
Roadmap for next-generation desalination technology;
(B) focus on research relating to, and development and
demonstration of, technologies that are appropriate for use
in desalinating brackish groundwater, wastewater and other
saline water supplies; disposal of residual brine or salt;
and
(C) consider the use of renewable energy sources.
(3) Under the desalination program, funds made available
may be used for construction projects, including completion
of the National Desalination Research Center for brackish
groundwater and ongoing facility operational costs.
(4) The Secretary and the Commissioner of Reclamation shall
jointly establish a steering committee for the desalination
program. The steering committee shall be jointly chaired by 1
representative from this Program and 1 representative from
the Bureau of Reclamation.
(f) Water and Energy Sustainability Program.--
(1) The Secretary shall carry out a research program to
develop understanding and technologies to assist in ensuring
that sufficient quantities of water are available to meet
present and future requirements.
(2) Under this program and in collaboration with other
programs within the Department including those within the
Offices of Fossil Energy and Energy Efficiency and Renewable
Energy, the Secretary of the Interior, Army Corps of
Engineers, Environmental Protection Agency, Department of
Commerce, Department of Defense, state agencies, non-
governmental agencies and academia, the Secretary shall
assess the current state of knowledge and program activities
concerning--
(A) future water resources needed to support energy
production within the United States including but not limited
to the water needs for hydropower and thermo-electric power
generation;
(B) future energy resources needed to support development
of water purification and treatment including desalination
and long-distance water conveyance;
(C) reuse and treatment of water produced as a by-product
of oil and gas extraction;
(D) use of impaired and non-traditional water supplies for
energy production and other uses; and
(E) technologies to reduce water use in energy production.
(3) In addition to the assessments in (2), the Secretary
shall--
(A) develop a research plan defining the scientific and
technology development needs and activities required to
support long-term water needs and planning for energy
sustainability, use of impaired water for energy production
and other uses, and reduction of water use in energy
production;
(B) carry out the research plan required under (A)
including development of numerical models, decision analysis
tools, economic analysis tools, databases, planning
methodologies and strategies;
(C) implement at least three planning demonstration
projects using the models, tools and planning approaches
developed under subparagraph (B) and assess the viability of
these tools at the scale of river basins with at least one
demonstration involving an international border; and
(D) transfer these tools to other federal agencies, state
agencies, non-profit organizations, industry and academia for
use in their energy and water sustainability efforts.
(4) Not later than 1 year after the date of enactment of
this Act, the Secretary shall submit to Congress a report on
the water and energy sustainability program that describes
the research elements described under paragraph (2), and
makes recommendations for a management structure that
optimizes use of Federal resources and programs.
(g) Cost Sharing.--
(1) Research projects under this section shall not require
cost-sharing.
(2) Each demonstration project carried out under the
Program shall be carried out on a cost-shared basis, as
determined by the Secretary.
(3) With respect to a demonstration project, the Secretary
may accept in-kind contributions, and waive the cost-sharing
requirement in appropriate circumstances.
______

SA 1473. Mr. SMITH (for himself and Ms. Murkowski) submitted an
amendment intended to be proposed by him to the bill S. 14, to enhance
the energy security of the United States, and for other purposes; which
was ordered to lie on the table; as follows:

At the end of title XI, add the following:

Subtitle I--Miscellaneous

SEC. 1195. ENERGY SECURITY OF ISRAEL.

(a) In General.--Notwithstanding any other provision of
law, the President may export oil to, or secure oil for, any
country pursuant to a bilateral international oil supply
agreement entered into by the United States with such nation
before June 25, 1979, or to any country pursuant to the
International Emergency Oil Sharing Plan of the International
Energy Agency.
(b) Memorandum of Agreement.--The following agreements
shall be deemed to have entered into force by operation of
law and shall be deemed to have no termination date:
(1) The agreement entitled ``Agreement amending and
extending the memorandum of agreement of June 22, 1979'',
entered into force November 13, 1994 (TIAS 12580).
(2) The agreement entitled ``Agreement amending the
contingency implementing arrangements of October 17, 1980'',
entered into force June 27, 1995 (TIAS 12670).
______

SA 1474. Mr. SMITH submitted an amendment intended to be proposed by
him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of title I of division B, add the following:

SEC. 102. EXPANSION OF CREDIT FOR ELECTRICITY PRODUCED FROM
CERTAIN RENEWABLE RESOURCES TO INCLUDE
INCREMENTAL HYDROPOWER.

(a) In General.--Section 45(c)(1) (defining qualified
energy resources), as amended by this Act, is amended--
(1) by striking ``and'' at the end of subparagraph (G),
(2) by striking the period at the end of subparagraph (H)
and inserting ``, and'', and
(3) by adding at the end the following new subparagraph:
``(I) incremental hydropower.''.
(b) Incremental Hydropower.--Section 45(c), as amended by
this Act, is amended by adding at the end the following new
paragraph:
``(8) Incremental hydropower.--
``(i) In general.--The term `incremental hydropower' means
for any taxable year an amount equal to the percentage of
total kilowatt hours of electricity produced from a
hydropower facility described in subsection (d)(8)
attributable to efficiency improvements or additions of
capacity as determined under clause (ii).
``(ii) Determination of incremental hydropower
production.--For purposes of clause (i), incremental
hydropower production for any hydropower facility for any
taxable year shall be determined by establishing a percentage
of average annual hydropower production at the facility
attributable to the efficiency improvements or additions of
capacity using the same water flow information used to
determine an historic average annual hydropower production
baseline for such facility. Such percentage and baseline
shall be certified by the Secretary in consultation with the
Federal Energy Regulatory Commission. For purposes of the
preceding sentence, the determination of incremental
hydropower production shall not be based on any operational
changes at such facility not directly associated with the
efficiency improvements or additions of capacity.''.
(c) Incremental Hydropower Facility.--Section 45(d)
(relating to qualified facilities),

[[Page S10712]]

as amended by this Act, is amended by adding at the end the
following new paragraph:
``(8) Incremental hydropower facility.--
``(A) In general.--In the case of a facility using
incremental hydropower to produce electricity, the term
`qualified facility' means any non-Federal hydroelectric
facility owned by the taxpayer the efficiency improvements or
additions of capacity to which are originally placed in
service after the date of the enactment of the Energy Tax
Incentives Act of 2003 and before January 1, 2009.
``(B) Special rules.--
``(i) 4-year period.--In the case of a qualified facility
described in subparagraph (A), the 4-year period beginning on
the date the efficiency improvements or additions of capacity
to the facility are originally placed in service shall be
substituted for the 10-year period in subsection
(a)(2)(A)(ii).
``(ii) Noncompliance with pollution laws.--For purposes of
this paragraph, a facility which is not in compliance with
the applicable State and Federal pollution prevention,
control, and permit requirements for any period of time shall
not be considered to be a qualified facility during such
period.''.
(d) Effective Date.--The amendments made by this section
shall apply to electricity produced and sold after the date
of the enactment of this Act, in taxable years ending after
such date.
______

SA 1475. Mr. SANTORUM (for himself and Mr. Rockefeller) submitted an
amendment intended to be proposed to amendment SA 1424 submitted by Mr.
Grassley (for himself, Mr. Baucus, Mr. Domenici, and Mr. Bingaman) and
intended to be proposed to the bill S. 14, to enhance the energy
security of the United States, and for other purposes; which was
ordered to lie on the table; as follows:

On page 221 of Division B, after line 24, insert the
following:
(e) Clarification relating to Coal Waste Sludge.--
(1) In general.--Subsection (c) of section 29 (relating to
definition of qualified fuels) is amended by inserting at the
end the following new paragraph:
``(4) Coal waste sludge.--
``(A) In general.--The term `solid synthetic fuels produced
from coal' includes liquefied coal waste sludge.
``(B) Coal waste sludge.--For purposes of this section, the
term `coal waste sludge' means the tar decanter sludge and
related byproducts of the coking process which are liquefied
and processed with coal into a feedstock for the manufacture
of coke.''.
(2) Denial of double benefit.--Subsection (d) of section
29, as amended by subsection (b), is amended by inserting at
the end the following new paragraph:
``(10) Denial of double benefit.--No credit shall be
allowed under this section for a qualified fuel produced from
coal and liquefied coal waste sludge to the extent to which a
credit is also allowed for the production of any coal waste
sludge used in the production of such qualified fuel.''.
______

SA 1476. Mr. BINGAMAN submitted an amendment intended to be proposed
to amendment SA 1432 proposed by Mr. Frist to the bill S. 14, to
enhance the energy security of the United States, and for other
purposes; which was ordered to lie on the table; as follows:

At the appropriate place, strike ``ending on--'' and all
that follows through ``2007.'' on line 21 and insert ``ending
on December 31, 2007.''.
______

SA 1477. Mr. BINGAMAN submitted an amendment intended to be proposed
to amendment SA 1432 proposed by Mr. Frist to the bill S. 14, to
enhance the energy security of the United States, and for other
purposes; which was ordered to lie on the table; as follows:

At the appropriate place, strike lines 12-16 and insert the
following:
``(ii) which has an electrical capacity of no more than
15,000 kilowatts or a mechanical energy capacity of no more
than 2,000 horsepower or an equivalent combination of
electrical and mechanical energy capacities,''.
On page 134, line 4, strike ``(70 percent'' and all that
follows through ``capacities)'' on line 10.
On page 136, strike lines 16 through ``section 168.'' on
line 22.
______

SA 1478. Mr. BINGAMAN (for himself and Ms. Collins) submitted an
amendment intended to be proposed to amendment SA 1432 proposed by Mr.
Frist to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of title III of division B, insert the
following:

SEC. ____. ALLOWANCE OF DEDUCTION FOR QUALIFIED ENERGY
MANAGEMENT DEVICES.

(a) In General.--Part VI of subchapter B of chapter 1
(relating to itemized deductions for individuals and
corporations), as amended by this Act, is amended by
inserting after section 179C the following new section:

``SEC. 179D. DEDUCTION FOR QUALIFIED ENERGY MANAGEMENT
DEVICES.

``(a) Allowance of Deduction.--In the case of a taxpayer
who is a supplier of electric energy or a provider of
electric energy services, there shall be allowed as a
deduction an amount equal to the cost of each qualified
energy management device placed in service during the taxable
year.
``(b) Maximum Deduction.--The deduction allowed by this
section with respect to each qualified energy management
device shall not exceed $30.
``(c) Qualified Energy Management Device.--The term
`qualified energy management device' means any meter or
metering device which is used by the taxpayer--
``(1) to measure and record electricity usage data on a
time-differentiated basis in at least 4 separate time
segments per day, and
``(2) to provide such data on at least a monthly basis to
both consumers and the taxpayer.
``(d) Property Used Outside the United States Not
Qualified.--No deduction shall be allowed under subsection
(a) with respect to property referred to in section 50(b)(1)
or with respect to the portion of the cost of any property
taken into account under section 179.
``(e) Basis Reduction.--
``(1) In general.--For purposes of this subtitle, if a
deduction is allowed under this section with respect to a
qualified energy management device, the basis of such
property shall be reduced by the amount of the deduction so
allowed.
``(2) Ordinary income recapture.--For purposes of section
1245, the amount of the deduction allowable under subsection
(a) with respect to any property that is of a character
subject to the allowance for depreciation shall be treated as
a deduction allowed for depreciation under section 167.
``(f) Termination.--This section shall not apply to any
qualified energy management device placed in service after
December 31, 2007.''.
(b) Conforming Amendments.--
(1) Section 263(a)(1), as amended by this Act, is amended
by striking ``or'' at the end of subparagraph (I), by
striking the period at the end of subparagraph (J) and
inserting ``, or'', and by inserting after subparagraph (J)
the following new subparagraph:
``(K) expenditures for which a deduction is allowed under
section 179D.''.
(2) Section 312(k)(3)(B), as amended by this Act, is
amended by striking ``or 179C'' each place it appears in the
heading and text and inserting ``179C, or 179D''.
(3) Section 1016(a), as amended by this Act, is amended by
striking ``and'' at the end of paragraph (33), by striking
the period at the end of paragraph (34) and inserting ``,
and'', and by adding at the end the following new paragraph:
``(35) to the extent provided in section 179D(e)(1).''.
(4) Section 1245(a), as amended by this Act, is amended by
inserting ``179D,'' after ``179C,'' both places it appears in
paragraphs (2)(C) and (3)(C).
(5) The table of contents for subpart B of part IV of
subchapter A of chapter 1, as amended by this Act, is amended
by inserting after the item relating to section 179C the
following new item:

``Sec. 179D. Deduction for qualified energy management devices.''.

(c) Effective Date.--The amendments made by this section
shall apply to qualified energy management devices placed in
service after the date of the enactment of this Act, in
taxable years ending after such date.
______

SA 1479. Mr. BINGAMAN submitted an amendment intended to be proposed
to amendment SA 1432 proposed by Mr. Frist to the bill S. 14, to
enhance the energy security of the United States, and for other
purposes; which was ordered to lie on the table; as follows:

Strike title XI.
______

SA 1480. Mr. BINGAMAN (for himself, Ms. Collins, Mr. Jeffords, Mr.
Chafee, Mr. Dorgan, and Ms. Cantwell) submitted an amendment intended
to be proposed by him to the bill S. 14, to enhance the energy security
of the United states, and for other purposes; which was ordered to lie
on the table; as follows:

At the end of title V renewables add the following.

Subtitle E--Renewable Portfolio Standard

SEC. 541 RENEWABLE PORTFOLIO STANDARD.

Titel VI of the Public Utility Regulatory Policies Act of
1978 (16 U.S.C. 2601 et seq.) is amended by adding at the end
the following:

``SEC. 606. FEDERAL RENEWABLE PORTFOLIO STANDARD.

``(a) Renewable Energy Requirements.--
``(1) In general.--Each electric utility that sells
electricity to electric consumers shall obtain a percentage
of the base amount of electricity it sells to electric
consumers in any calendar year from new renewable energy or
existing renewable energy. The percentage obtained in a
calendar year shall not be less than the amount specified in
the following table:

``Calendar year                               Minimum annual percentage
2008 through 2011.............................................2.5....

2012 through 2015.............................................5.0....

2016 through 2019.............................................7.5....

2020 through 2030............................................10.0....

``(2) Means of compliance.--An electric utility shall meet
the requirements of paragraph (1) by--

[[Page S10713]]

``(A) generating electric energy using new renewable energy
or existing renewable energy;
``(B) purchasing electric energy generated by new renewable
energy or existing renewable energy;
``(C) Purchasing renewable energy credits issued under
subsection (b); or
``(D) A combination of the foregoing.
``(b) Renewable Energy Credit Trading Program.--
``(1) Not later than January 1, 2005, the Secretary shall
establish a renewable energy credit trading program to permit
an electric utility that does not generate or purchase enough
electric energy from renewable energy to meet its obligations
under subsection (a)(1) to safisfy such requirements by
purchasing sufficient renewable energy credits.
``(2) As part of such program the Secretary shall--
``(A) issue renewable energy credits to generators of
electric energy from new renewable energy;
``(B) sell renewable energy credits to electric utilities
at the rate of 1.5 cents per kilowatt-hour (as adjusted for
inflation under subsection (g));
``(C) ensure that a kilowatt hour, including the associated
renewable energy credits, shall be used only once for
purposes of compliance with this section;
``(D) allow double credits for generation from facilities
on Indian Lands, and triple credits for generation from small
renewable distributed generators, i.e., those no larger than
one megawatt.
``(3) Credits under paragraph (2)(A) may only be used for
compliance with this section for 3 years from the data
issued.
``(c) Enforcement.--
``(1) Civil penalties.--Any electric utility that fails to
meet the energy renewable requirements of subjection (a)
shall be subject to a civil penalty.
``(2) Amount of penalty.--The amount of the civil penalty
shall be determined by multiplying the number of kilowatt-
hours of electric energy sold to electric consumers in
violation of subjection (a) by the greater of 1.5 cents
(adjusted for inflation under subsection (g)) or 200 percent
of the average market value of renewable energy credits
during the year in which the violation occurred.
``(3) Mitigation or waiver.--The Secretary may mitigate or
waive a civil penalty under this subsection if the electric
utility was unable to comply with subjection (a) for reasons
outside of the reasonable control of the utility.
``(4) Procedure for assessing penalty.--The Secretary shall
assess a civil penalty under this subsection in accordance
with the procedures prescribed by section 333(d) of the
Energy Policy and Conservation Act of 1954 (42 U.S.C. 6303).
``(d) State Renewable Energy Account Program.--
``(1) The Secretary shall establish, not later than
December 31, 2008, a State renewable energy account program.
``(2) All money collected by the Secretary from the sale of
renewable energy credits and the assessment of civil
penalties under this section shall be deposited into the
renewable energy account established pursuant to this
subsection. The State renewable energy account shall be held
by the Secretary and shall not be transferred to the Treasury
Department.
``(3) Proceeds deposited in the State renewable energy
account shall be used by the Secretary, subject to
appropriations, for a program to provide grants to the State
agency responsible for developing State energy conservation
plans under section 363 of the Energy Policy and Conservation
Act (42 U.S.C. 6322) for the purposes of promoting renewable
energy production, including programs that promote
technologies that reduce the use of electricity at customer
sites such as solar water heating.
``(4) The Secretary may issue guidelines and criteria for
grants awarded under this subsection. State energy offices
receiving grants under this section shall maintain such
records and evidence of compliance as the Secretary may
require.
``(5) In allocating funds under this program, the Secretary
shall give preference to States in regions which have a
disproportionately small share of economically sustainable
renewable energy generation capacity; and to State programs
to stimulate or enhance innovative renewable energy
technologies.
``(e) Rules.--The Secretary shall issue rules implementing
this section not later than one year after the date of
enactment of this section.
``(f) Exemptions.--This section shall not apply in any
calendar year to an electric utility
``(1) that sold less than 4,000,000 megawatt-hours of
electric energy to electric consumers during the preceding
calendar year; or
``(2) in Hawaii.
``(g) Inflation Adjustment.--Not later than December 31 of
each year beginning in 2008, the Secretary shall adjust for
inflation the price of a renewable energy credit under
subsection (b)(2)(B) and the amount of the civil penalty per
kilowatt-hour under subsection (c)(2).
``(h) State Programs.--Nothing in this section shall
diminish any authority of a State or political subdivision
thereof to adopt or enforce any law or regulation respecting
renewable energy, but no such law or regulation shall relieve
any person of any requirement otherwise applicable under this
section. The Secretary, in consultation with States having
such renewable energy programs, shall, to the maximum extent
practicable, facilitate coordination between the Federal
program and State programs.
``(i) Definitions.--For purposes of this section:
``(1) The term `base amount of electricity' means the total
amount of electricity sold by an electric utility to electric
consumers in a calendar year, excluding--
``(A) electricity generated by a hydroelectric facility
(except incremental hydropower); and
``(B) electricity generated through the incineration of
municipal solid waste.
``(2) The term `existing renewable energy' means, except as
provided in paragraph (3)(B), electric energy generated at a
facility (including a distributed generation facility) placed
in service prior to the date of enactment of this section
from solar, wind, ocean, current, wave, tidal or goethermal
energy; biomass (as defined in section 504(b)); or landfill
gas.
``(3) The term `new renewable energy' means--
``(A) electric energy generated at a facility (including a
distributed generation facility) placed in service on or
after the date of enactment of this section from solar, wind,
ocean, current, wave, tidal or geothermal energy; biomass (as
defined in section 504(b)); landfill, gas; or incremental
hydropower; and
``(B) for electric energy generated at a facility
(including a distributed generation facility) placed in
service prior to the date of enactment of this section--
``(i) the additional energy above the average generation in
the 3 years preceding the date of enactment of this section
at the facility from solar, wind, or ocean energy; biomass
(as defined in section 504(b)); landfill gas or incremental
hydropower.
``(ii) the incremental geothermal production.
``(4) The term `distributed generation facility' means a
facility at a customer site.
``(5) The term `incremental hydropower' means additional
energy generated as a result of efficiency improvements or
capacity additions made on or after the date of enactment of
this section or the effective date of an existing applicable
State renewable portfolio standard program at a hydroelectric
facility that was placed in service before that date. The
term does not include additional energy generated as a result
of operational changes not directly associated with
efficiency improvements or capacity additions. Efficiency
improvements and capacity additions shall be measured on the
basis of the same water flow information used to determine a
historic average annual generation baseline for the
hydroelectric facility and certified by the Secretary or the
Federal Energy Regulatory Commission.
``(6) Geothermal Energy.--The term `geothermal energy'
means energy derived from a geothermal deposit (within the
meaning of section 613(e)(2) of the Internal Revenue Code of
1986).
``(7) Incremental Geothermal Production.--
``(A) In general.--The term'; incremental geothermal
production' means for any year the excess of--
``(i) the total kilowatt hours of electricity produced from
a facility (including a distributed generation facility)
using geothermal energy, over
``(ii) the average annual kilowatt hours produced at such
facility for 5 of the previous 7 calendar years before the
date of enactment of this section after eliminating the
highest and the lowest kilowatt hour production years in such
7-year period.
``(B) Special rule.--A facility described in subparagraph
(A) which was placed in service at least 7 years before the
date of enactment of this section shall commencing with the
year in which such date of enactment occurs, reduce the
amount calculated under subparagraph (A)(ii) each year, on a
cumulative basis, by the average percentage decrease in the
annual kilowatt hour production for the 7-year period
described in subparagraph (A)(ii) with such cumulative sum
not to exceed 30 percent.
``(j) Sunset.--This section expires on December 31,
2030.''.
______

SA 1481. Mr. BINGAMAN submitted an amendment intended to be proposed
to amendment SA 1432 proposed by Mr. Frist to the bill S. 14, to
enhance the energy security of the United States, and for other
purposes; which was ordered to lie on the table; as follows:

At the appropriate place in the amendment, strike section
715 and insert the following:

SEC. 715. REDUCTION OF ENGINE IDLING OF HEAVY-DUTY VEHICLES.

(a) Definitions.--In this section:
(1) Administrator.--The term ``Administrator'' means the
Administrator of the Environmental Protection Agency.
(2) Advanced truck stop electrification system.--The term
``advanced truck stop electrification system'' means a
stationary and independent electrification system that
delivers heat, air conditioning, electricity, communications,
and other convenient services, and is capable of providing
verifiable and auditable evidence of use of those services,
to a heavy-duty vehicle and any occupants of the heavy-duty
vehicle without relying on components mounted onboard the
heavy-duty vehicle for delivery of those services.

[[Page S10714]]

(3) Auxiliary power unit.--The term ``auxiliary power
unit'' means an integrated system that--
(A) provides heat, air conditioning, engine warming, and
electricity to the factory-installed components on a heavy-
duty vehicle as if the main drive engine of the heavy-duty
vehicle were running; and
(B) is certified by the Administrator of the Environmental
Protection Agency under part 89 of title 40, Code of Federal
Regulations (or successor regulations), as meeting applicable
emission standards.
(4) Heavy-duty vehicle.--The term ``heavy-duty vehicle''
means a vehicle that--
(A) has a gross vehicle weight rating greater than 12,500
pounds; and
(B) is powered by a diesel engine.
(5) Idle reduction technology.--The term ``idle reduction
technology'' means an advanced truck stop electrification
system, auxiliary power unit, or another device or system of
devices that--
(A) is used to reduce long-duration idling of a heavy-duty
vehicle; and
(B) allows for the main drive engine or auxiliary
refrigeration engine of a heavy-duty vehicle to be shut down.
(6) Long-duration idling.--
(A) In general.--The term ``long-duration idling'' means
the operation of a main drive engine or auxiliary
refrigeration engine of a heavy-duty vehicle, for a period
greater than 15 consecutive minutes, at a time at which the
main drive engine is not engaged in gear.
(B) Exclusions.--The term ``long-duration idling'' does not
include the operation of a main drive engine or auxiliary
refrigeration engine of a heavy-duty vehicle during a routine
stoppage associated with traffic movement or congestion.
(b) Idle Reduction Technology Benefits, Programs, and
Studies.--
(1) In general.--Not later than 90 days after the date of
enactment of this Act, the Administrator shall--
(A)(i) commence a review of the mobile source air emission
models of the Environmental Protection Agency used under the
Clean Air Act (42 U.S.C. 7401 et seq.) to determine whether
the models accurately reflect the emissions resulting from
long-duration idling of heavy-duty vehicles and other
vehicles and engines; and
(ii) update those models as the Administrator determines to
be appropriate; and
(B)(i) commence a review of the emission reductions
achieved by the use of idle reduction technology; and
(ii) complete such revisions of the regulations and
guidance of the Environmental Protection Agency as the
Administrator determines to be appropriate.
(2) Deadline for completion.--Not later than 180 days after
the date of enactment of this Act, the Administrator shall--
(A) complete the reviews under subparagraphs (A)(i) and
(B)(i) of paragraph (1); and
(B) prepare and make publicly available 1 or more reports
on the results of the reviews.
(3) Discretionary inclusions.--The reviews under
subparagraphs (A)(i) and (B)(i) of paragraph (1) and the
reports under paragraph (2)(B) may address the potential fuel
savings resulting from use of idle reduction technology.
(4) Idle reduction deployment program.--
(A) In general.--Not later than 90 days after the date of
the enactment of this Act, the Administrator, in consultation
with the Secretary of Transportation, shall establish a
program to support deployment of idle reduction technology
that benefits strategic locations based on air quality and
congestion considerations.
(B) Authorization of appropriations.--There are authorized
to be appropriated to the Administrator such sums as are
necessary to carry out subparagraph (A).
(5) Idling location study.--
(A) In general.--Not later than 90 days after the date of
the enactment of this Act, the Secretary of Transportation,
in consultation with the Administrator, shall commence a
study to analyze all locations at which heavy-duty vehicles
stop for long duration idling, including--
(i) truck stops;
(ii) rest areas;
(iii) border crossings;
(iv) ports;
(v) transfer facilities; and
(vi) private terminals.
(B) Deadline for completion.--Not later than 180 days after
the date of enactment of this Act, the Secretary shall--
(i) complete the study under subparagraph (A); and
(ii) prepare and make publicly available 1 or more reports
of the results of the study.
(c) Vehicle Weight Exemption.--Section 127(a) of title 23,
United States Code, is amended--
(1) by designating the first through eleventh sentences as
paragraphs (1) through (11), respectively; and
(2) by adding at the end the following:
``(12) Heavy-duty vehicles.--
``(A) In general.--Subject to subparagraphs (B) and (C), in
order to promote reduction of fuel use and emissions due to
engine idling, the maximum gross vehicle weight limit and the
axle weight limit for any heavy-duty vehicle equipped with an
idle reduction technology shall be increased by a quantity
necessary to compensate for the additional weight of the idle
reduction system.
``(B) Maximum weight increase.--The weight increase under
subparagraph (A) shall be not greater than 250 pounds.
``(C) Proof.--On request by a regulatory or law enforcement
agency, the vehicle operator shall provide proof (through
demonstration or certification) that--
``(i) the idle reduction technology is fully functional at
all times; and
``(ii) the 250-pound gross weight increase is not used for
any purpose other than the use of idle reduction technology
described in subparagraph (A).''.
______

SA 1482. Mr. BINGAMAN submitted an amendment intended to be proposed
to amendment SA 1432 proposed by Mr. Frist to the bill S. 14, to
enhance the energy security of the United States, and for other
purposes; which was ordered to lie on the table; as follows:

Strike the text starting on page 159, line 14, through page
165, line 14, and insert the following:

SEC. 511. ALTERNATIVE CONDITIONS AND FISHWAYS.

(a) Alternative Mandatory Conditions.--Section 4 of the
Federal Power Act (16 U.S.C. 797) is amended by adding at the
end the following:
(h)(1) Whenever any person applies for a license for any
project works within any reservation of the United States,
and the Secretary of the department under whose supervision
such reservation falls deems a condition to such license to
be necessary under the first proviso of subsection (e), the
license applicant or any other party to the licensing
proceeding may propose an alternative condition.
``(2) Notwithstanding the first proviso of subsection (e),
the Secretary of the department under whose supervision the
reservation falls shall accept the proposed alternative
condition referred to in paragraph (1), and the Commission
shall include in the license such alternative condition, if
the Secretary of the appropriate department determines, based
on substantial evidence provided by the party proposing such
alternative condition, that the alternative condition--
``(A) provides no less protection for the reservation than
provided by the condition deemed necessary by the Secretary;
and
``(B) will either--
``(i) cost less to implement, or
``(ii) result in improved operation of the project works
for electricity production,

as compared to the condition deemed necessary by the
Secretary.
``(3) Within 1 year after the enactment of this subsection,
each Secretary concerned shall, by rule, establish a process
to expeditiously resolve conflicts arising under this
subsection.''.
(b) Alternative Fishways.--Section 18 of the Federal Power
Act (16 U.S.C. 811) is amended by--
(1) inserting ``(a)'' before the first sentence; and
(2) adding at the end the following:
``(b)(1) Whenever the Commission shall require a licensee
to construct, maintain, or operate a fishway prescribed by
the Secretary of the Interior or the Secretary of Commerce
under this section, the licensee or any other party to the
proceeding may propose an alternative to such prescription to
construct, maintain, or operate a fishway.
``(2) Notwithstanding subsection (a), the Secretary of the
Interior or the Secretary of Commerce, as appropriate, shall
accept and prescribe, and the Commission shall require, the
proposed alternative referred to in paragraph (1), if the
Secretary of the appropriate department determines, based on
substantial evidence provided by the party proposing such
alternative, that the alternative--
``(A) will be no less effective than the fishway initially
prescribed by the Secretary, and
``(B) will either--
``(i) cost less to implement, or
``(ii) result in improved operation of the project works
for electricity production.

as compared to the fishway initially prescribed by the
Secretary.
``(3) Within 1 year after the enactment of this subsection,
the Secretary of the Interior and the Secretary of Commerce
shall each, by rule, establish a process to expeditiously
resolve conflicts arising under this subsection.''.
______

SA 1483. Mr. BINGAMAN submitted an amendment intended to be proposed
to amendment SA 1432 proposed by Mr. Frist to the bill S. 14, to
enhance the energy security of the United States, and for other
purposes; which was ordered to lie on the table; as follows:

Strike the text starting on page 159, line 14, through page
165, line 14, and insert the following:

SEC. 511. ALTERNATIVE CONDITIONS AND FISHWAYS.

(a) Alternative Mandatory Conditions.--Section 4 of the
Federal Power Act (16 U.S.C. 797) is amended by adding at the
end the following:
``(h)(1) Whenever any person applies for a license for any
project works within any reservation of the United States
under subsection (e), and the Secretary of the department
under whose supervision such reservation falls (in this
subsection referred to as the `Secretary') shall deem a
condition to such license to be necessary under the first
proviso of such section, the license applicant or any party
to the licensing proceeding, including States and Indian
tribes, may propose an alternative condition.

[[Page S10715]]

``(2) Notwithstanding the first proviso of subsection (e),
the Secretary of the department under whose supervision the
reservation falls shall accept the proposed alternative
condition referred to in paragraph (1), the Commission shall
include in the license such alternative condition, if the
Secretary of the appropriate department determines, based on
substantial evidence provided by the party proposing such
alternative condition, that the alternative condition--
``(A) provides for the adequate protection and utilization
of the reservation; and
``(B) will either--
``(i) cost less to implement, or
``(ii) result in improved operation of the project works
for electricity production as compared to the condition
initially deemed necessary by the Secretary.
``(3) The Secretary shall submit into the public record of
the Commission proceeding with any condition under subsection
(e) or alternative condition it accepts under this subsection
a written statement explaining the basis for such condition,
and reason for not accepting any alternative condition under
this subsection, including the effects of the condition
accepted and alternatives not accepted on energy supply,
distribution, cost, and use, air quality, flood control,
navigation, and drinking, irrigation, and recreation water
supply, based on such information as may be available to the
Secretary, including information voluntarily provided in a
timely manner by the applicant and others.''.
(b) Alternative Fishways.--Section 18 of the Federal Power
Act (16 U.S.C. 811) is amended by--
(1) inserting ``(a)'' before the first sentence; and
(2) adding at the end the following:
``(b)(1) Whenever the Secretary of the Interior or the
Secretary of Commerce prescribes a fishway under this
section, the license applicant or nay other party to the
licensing proceeding, including States and Indian tribes, may
propose an alternative to such prescription to construct,
maintain, or operate a fishway.
``(2) Notwithstanding subsection (a), the Secretary of the
Interior or the Secretary of Commerce, as appropriate, shall
accept and prescribe, and the Commission shall require, the
proposed alternative fishway referred to in paragraph (1), if
the Secretary of the appropriate department determines, based
on substantial evidence provided by the party proposing such
alternative, that the alternative--
``(A) will be no less effective than the fishway initially
prescribed by the Secretary; and
``(B) will either--
``(i) cost less to implement, or
``(ii) result in improved operation of the project works
for electricity production as compared to the fishway
initially prescribed by the Secretary.
``(3) The Secretary shall submit into the public record of
the Commission proceeding with any prescription under
subsection (a) or alternative prescription it accepts under
this subsection a written statement explaining the basis for
such prescription, and reason for not accepting any
alternative prescription under this subsection, including the
effects of the prescription accepted or alternative not
accepted on energy supply, distribution, cost, and use, air
quality, flood control, navigation, and drinking, irrigation,
and recreation water supply, based on such information as may
be available to the Secretary, including information
voluntarily provided in a timely manner by the applicant and
others.''
______

SA 1484. Mr. REID (for himself and Mr. Ensign) submitted an amendment
intended to be proposed by him to the bill S. 14, to enhance the energy
security of the United States, and for other purposes; which was
ordered to lie on the table; as follows:

At the end of subtitle D of title IV, insert the following:

SEC. 4____. WHISTLEBLOWER PROTECTION.

(a) Definition of Employer.--Section 211(a)(2) of the
Energy Reorganization Act of 1974 (42 U.S.C. 5851(a)(2)) is
amended--
(1) in subparagraph (C), by striking ``and'' at the end;
(2) in subparagraph (D), by striking ``that is
indemnified'' and all that follows through ``12344.'' and
inserting ``or the Commission; and''; and
(3) by adding at the end the following:
``(E) the Department of Energy and the Commission.''.
(b) De Novo Judicial Determination.--Section 211(b) of the
Energy Reorganization Act of 1974 (42 U.S.C. 5851(b)) is
amended by adding at the end the following:
``(4) De novo judicial determination.--If the Secretary
does not issue a final decision within 180 days after the
filing of a complaint under paragraph (1) and the Secretary
does not show that the delay is caused by the bad faith of
the claimant, the claimant may bring a civil action in United
States district court for a determination of the claim by the
court de novo.''.
______

SA 1485. Mr. REED submitted an amendment intended to be proposed by
him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 46, lines 14 and 15, strike ``(ii) or (iii)'' and
insert ``(ii), (iii), or (iv)''.
On page 47, between lines 10 and 11, insert the following:
``(iv) if such vehicle is a 2-wheel electric cycle that has
a vehicle identification number and meets all applicable
Federal motor vehicle safety standards, the lesser of--

``(I) 10 percent of the manufacturer's suggested retail
price, or
``(II) $200.

On page 48, between lines 18 and 19, insert the following:
(3) Vehicles with less than 4 wheels.--Section 30(c)(2) is
amended by striking ``4'' and inserting ``2''.
On page 40, line 7, after ``30(c)(2)'' insert ``, except
that `4 wheels' shall be substituted for `2 wheels'''.
On page 58, line 16, after ``30(c)(2)'' insert ``, except
that `4 wheels' shall be substituted for `2 wheels'''.
______

SA 1486. Mr. REED submitted an amendment intended to be proposed by
him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end, add the following:

TITLE XII--NATURAL GAS

SEC. 1201. REDUCTION OF DEPENDENCE ON NATURAL GAS.

(a) Report.--
(1) In general.--Not later than February 1, 2004, and
annually thereafter, the President shall submit to Congress a
report, based on the most recent edition of the Annual Energy
Outlook published by the Energy Information Administration,
assessing the progress made by the United States toward the
goal of reducing excessive dependence on natural gas by 2015
and 2025.
(2) Contents.--The report under paragraph (1) shall--
(A) include a description of the implementation, during the
previous fiscal year, of provisions under this Act relating
to natural gas production and efficiency;
(B) assess the effectiveness of those provisions in meeting
the goal described in paragraph (1);
(C) describe the progress in developing and implementing
measures under subsection (b); and
(D) identify opportunities to reduce natural gas demand
further through new legislative initiatives.
(b) Measures To Reduce Natural Gas Dependence Through
Increased Efficiency and Conservation.--
(1) In general.--Not later than 1 year after the date of
enactment of this Act, the President shall develop and
implement measures to conserve natural gas in end uses (not
including electrical generation) throughout the economy of
the United States sufficient to reduce total end use demand
for natural gas in the United States by at least 10 percent
from the amount projected for calendar year 2015, and by at
least 20 percent from the amount projected for 2025, in the
reference case contained in the report of the Energy
Information Administration entitled ``Annual Energy Outlook
2003''.
(2) Basis of calculations.--For the purpose of developing
measures under paragraph (1), the President shall calculate
levels of demand and demand reduction in such a manner as to
account only for efficiency increases and conservation and
not reflect changes caused by fuel switching to or from
natural gas.
(3) Contents.--The measures under paragraph (1) shall be
designed to ensure continued reliable and affordable energy
for consumers.
(4) Implementation.--The measures under paragraph (1) shall
be implemented under existing authorities of appropriate
Federal executive agencies identified by the President.
______

SA 1487. Ms. LANDRIEU submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of section 32(d) of the Outer Continental Shelf
Lands Act (as added by section 111), add the following:
``(5) Coastal impact assistance plans of coastal political
subdivisions.--
``(A) In general.--A Coastal Impact Assistance Plan for the
State of Louisiana shall include a coastal impact assistance
plan developed by each coastal political subdivision in the
State of Louisiana.
``(B) Approval.--In approving the plans of the coastal
political subdivisions, the Governor of the State of
Louisiana shall have the authority only to ensure that the
proposed uses of funds that are included in the plans of the
coastal political subdivisions are consistent with the
authorized uses under subsection (e).
______

SA 1488. Mr. LAUTENBERG (for himself and Mr. Corzine) submitted an
amendment intended to be proposed by him to the bill S. 14, to enhance
the energy security of the United States, and for other purposes; which
was ordered to lie on the table; as follows:

At the end of title III of Division B, insert the
following:

SEC. ____. QUALIFIED DUCT SEALING SERVICES AND QUALIFIED AIR
INFILTRATION REDUCTION SERVICES.

(a) In General.--Subpart A of part IV of subchapter A of
chapter 1 (relating to nonrefundable personal credits), as
amended by

[[Page S10716]]

this Act, is amended by inserting after section 25D the
following new section:

``SEC. 25E. QUALIFIED DUCT SEALING SERVICES AND QUALIFIED AIR
INFILTRATION REDUCTION SERVICES.

``(a) Allowance of Credit.--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 25
percent of the amount paid or incurred by the taxpayer for
qualified duct sealing services or qualified air infiltration
reduction services performed during such year.
``(b) Limitation.--The credit allowed by this section with
respect to a dwelling for any taxable year shall not exceed
$300, reduced (but not below zero) by the sum of the credits
allowed under subsection (a) to the taxpayer with respect to
the dwelling for all preceding taxable years.
``(c) Carryforward of Unused Credit.--If the credit
allowable under subsection (a) exceeds the limitation imposed
by section 26(a) for such taxable year reduced by the sum of
the credits allowable under this subpart (other than this
section) for such taxable year, such excess shall be carried
to the succeeding taxable year and added to the credit
allowable under subsection (a) for such succeeding taxable
year.
``(d) Qualified Duct Sealing Services; Qualified Air
Infiltration Reduction Services.--For purposes of this
section--
``(1) Qualified duct sealing services.--
``(A) In general.--The term `qualified duct sealing
services' means services which bring the duct system of a
dwelling into compliance with the Energy Star Duct
Specifications published by the Environmental Protection
Agency if such service is performed with regard to a dwelling
which--
``(i) is located in the United States,
``(ii) has not been treated as a qualifying new home for
purposes of any credit allowed under section 45G, and
``(iii) is owned and used by the taxpayer as the taxpayer's
principal residence (within the meaning of section 121).
``(B) Certification required.--Services shall not be
considered to be qualified duct sealing services unless the
dwelling is determined to be not in compliance with such
Energy Star Duct Specifications before such services and
certified to be in compliance with such Energy Star Duct
Specifications after such services.
``(2) Qualified air infiltration reduction services.--
``(A) In general.--The term `qualified air infiltration
reduction services' means services which bring the air
infiltration of a dwelling into compliance with the
infiltration requirements in the Energy Star Home Sealing
Specifications published by the Environmental Protection
Agency, if such service is performed with regard to a
dwelling which--
``(i) is located in the United States,
``(ii) has not been treated as a qualifying new home for
purposes of any credit allowed under section 45G, and
``(iii) is owned and used by the taxpayer as the taxpayer's
principal residence (within the meaning of section 121).
``(B) Certification required.--Services shall not be
considered to be qualified air infiltration reduction
services unless the dwelling is determined to not be in
compliance with such Energy Star Home Sealing Specifications
before such services and is certified to be in compliance
with such Energy Star Home Sealing Specifications after such
services.
``(e) Certification.--
``(1) Methods of certification.--
``(A) Qualified duct sealing services.--The determination
and certification described in paragraph (1) of subsection
(d) shall be on the basis of test reports performed in
accordance with the Energy Star Duct Specifications.
``(B) Qualified air infiltration reduction services.--The
determination and certification described in paragraph (2) of
subsection (d) shall be on the basis of test reports
performed in accordance with the Energy Star Home Sealing
Specifications.
``(2) Provider.--A determination or certification described
in subsection (d) shall be provided by a State-licensed
contractor.
``(3) Form.--A certification described in subsection (d)
shall be made in writing on forms which provide test data on
air infiltration and duct leakage, as appropriate, both
before and after services are provided, provide a signed
certification that all relevant aspects of the appropriate
Environmental Protection Agency specifications have been met,
and include a permanent label affixed to the electrical
distribution panel of the dwelling.
``(f) Special Rules.--For purposes of this section--
``(1) Dollar amounts in case of joint occupancy.--In the
case of any dwelling unit which is jointly occupied and used
during any calendar year as a residence by 2 or more
individuals the following rules shall apply:
``(A) The amount of the credit allowable under subsection
(a) by reason of expenditures for qualified duct sealing
services or qualified air infiltration reduction services
made during such 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 individual 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 paid his tenant-
stockholder's proportionate share (as defined in section
216(b)(3)) of the cost of qualified duct sealing services or
qualified air infiltration reduction services expenditures
made by such corporation.
``(3) Condominiums.--
``(A) In general.--In the case of an individual 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 paid the individual's
proportionate share of the cost of qualified duct sealing
services or qualified air infiltration reduction services
expenditures made by such association.
``(B) Condominium management association.--For purposes of
this paragraph, the term `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 condominium project substantially
all of the units of which are used as residences.
``(4) Manufactured homes included.--For purposes of this
section, the term `dwelling ' includes a manufactured home
which conforms to Federal Manufactured Home Construction and
Safety Standards (24 C.F.R. 3280).
``(5) No double benefit.--The amount of any deduction or
other credit allowable under this chapter for any cost taken
into account in computing the amount of the credit determined
under subsection (a) shall be reduced by the amount of such
credit attributable to such cost.
``(g) Basis Adjustment.--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.
``(h) Termination.--Subsection (a) shall not apply to
qualified duct sealing services or qualified air infiltration
reduction services performed after December 31, 2005.''.
(b) Credit Allowed Against Regular Tax and Alternative
Minimum Tax.--
(1) In general.--Section 25E(b), as added by subsection
(a), is amended--
(A) by striking ``The credit'' and inserting the following:
``(1) Dollar amount.--The credit'', and
(B) by adding at the end the following new paragraph:
``(2) Limitation based on amount of tax.--The credit
allowed under subsection (a) for the taxable year shall not
exceed the excess of--
``(A) the sum of the regular tax liability (as defined in
section 26(b)) plus the tax imposed by section 55, over
``(B) the sum of the credits allowable under this subpart
(other than this section) and section 27 for the taxable
year.''.
(2) Conforming amendments.--
(A) Section 25E(c), as added by subsection (a), is amended
by striking ``section 26(a) for such taxable year reduced by
the sum of the credits allowable under this subpart (other
than this section)'' and inserting ``subsection (b)(3)''.
(B) Section 23(b)(4)(B), as amended by this Act, is amended
by striking ``sections 25C and 25D'' and inserting ``sections
25C, 25D, and 25E''.
(C) Section 24(b)(3)(B), as amended by this Act, is amended
by striking ``and 25D'' and inserting ``25D, and 25E''.
(D) Section 25(e)(1)(C), as amended by this Act, is amended
by inserting ``25E,'' after ``25D,''.
(E) Section 25B(g)(2), as amended by this Act, is amended
by striking ``23, 25C, and 25D'' and inserting ``23, 25C,
25D, and 25E''.
(F) Section 26(a)(1), as amended by this Act, is amended by
striking ``and 25D'' and inserting ``25D, and 25E''.
(G) Section 904(h), as amended by this Act, is amended by
striking ``and 25D'' and inserting ``25D, and 25E''.
(H) Section 1400C(d), as amended by this Act, is amended by
striking ``and 25D'' and inserting ``25D, and 25E''.
(c) Additional Conforming Amendments.--
(1) Section 23(c), as in effect for taxable years beginning
before January 1, 2004, and as amended by this Act, is
amended by inserting ``, 25E,'' after ``sections 25D''.
(2) Section 25(e)(1)(C), as in effect for taxable years
beginning before January 1, 2004, and as amended by this Act,
is amended by inserting ``25E,'' after ``25D,''.
(3) Section 1016(a), as amended by this Act, is amended by
striking ``and'' at the end of paragraph (33), by striking
the period at the end of paragraph (34) and inserting ``;
and'', and by adding at the end the following new paragraph:
``(35) to the extent provided in section 25E(g), in the
case of amounts with respect to which a credit has been
allowed under section 25E.''.

[[Page S10717]]

(4) Section 1400C(d), as in effect for taxable years
beginning before January 1, 2004, and as amended by this Act,
is amended by striking ``sections 25C and 25D'' and inserting
``sections 25C, 25D, and 25E''.
(5) The table of sections for subpart A of part IV of
subchapter A of chapter 1, as amended by this Act, is amended
by inserting after the item relating to section 25D the
following new item:

``Sec. 25E. Qualified duct sealing services and qualified air
infiltration reduction services.''.
(d) Effective Dates.--
(1) In general.--Except as provided by paragraph (2), the
amendments made by this section shall apply to property
installed after the date of the enactment of this Act, in
taxable years ending after such date.
(2) Subsection (b).--The amendments made by subsection (b)
shall apply to taxable years beginning after December 31,
2003.
______

SA 1489. Mr. LAUTENBERG (for himself and Mr. Corzine) submitted an
amendment intended to be proposed by him to the bill S. 14, to enhance
the energy security of the United States, and for other purposes; which
was ordered to lie on the table; as follows:

At the end of title III of Division B, insert the
following:

SEC. ____. REPLACEMENT NATURAL GAS OR PROPANE FURNACE OR
BOILER.

(a) In General.--Subpart A of part IV of subchapter A of
chapter 1 (relating to nonrefundable personal credits), as
amended by this Act, is amended by inserting after section
25D the following new section:

``SEC. 25E. REPLACEMENT NATURAL GAS OR PROPANE FURNACE OR
BOILER.

``(a) Allowance of Credit.--In the case of an individual,
there shall be allowed as a credit against the tax imposed by
this chapter for the taxable year the cost of each
replacement natural gas or propane furnace or boiler
installed by the taxpayer during the taxable year in a
dwelling unit located in the United States and used as a
residence by the taxpayer.
``(b) Limitations.--The credit allowed under subsection (a)
for any dwelling unit shall not exceed $300 over the
aggregate cost taken into account under subsection (a) with
respect to such unit for all preceding taxable years.
``(c) Carryforward of Unused Credit.--If the credit
allowable under subsection (a) exceeds the limitation imposed
by section 26(a) for such taxable year reduced by the sum of
the credits allowable under this subpart (other than this
section), such excess shall be carried to the succeeding
taxable year and added to the credit allowable under
subsection (a) for such succeeding taxable year.
``(d) Replacement Natural Gas or Propane Furnace or
Boiler.--
``(1) In general.--For purposes of this section, the term
`replacement natural gas furnace or boiler' means a natural
gas or propane furnace or boiler which achieves at least 90
percent annual fuel utilization efficiency (AFUE) and
replaces an existing natural gas or propane furnace or boiler
which has an AFUE of less than 78 percent or which does not
include a power burner or induced draft exhaust.
``(2) Labor costs.--Labor costs properly allocable to the
onsite preparation, assembly, or original installation of a
replacement natural gas or propane furnace or boiler and for
piping or wiring to interconnect such natural gas or propane
furnace or boiler to the dwelling unit shall be taken into
account for purposes of this section.
``(e) Special Rules.--For purposes of this section--
``(1) Property financed by subsidized energy financing.--No
credit shall be allowed under subsection (a) to the extent
that the property is paid for by subsidized energy financing
(as defined in section 48(a)(5)(C)).
``(2) No double benefit.--The amount of any deduction or
other credit allowable under this chapter for any cost taken
into account in computing the amount of the credit determined
under subsection (a) shall be reduced by the amount of such
credit attributable to such cost.
``(3) Basis Adjustments.--For purposes of this subtitle,
the basis of any property for which a credit is allowable
under subsection (a) shall be reduced by the amount of such
credit so allowed.
``(4) Joint occupancy, housing cooperatives, etc.--Rules
similar to the rules of paragraphs (1), (2), (3), and (5) of
section 25C(e) shall apply.
``(f) Termination.--The credit allowed under this section
shall not apply to replacement natural gas or propane
furnaces or boilers installed after December 31, 2005.''.
(b) Credit Allowed Against Regular Tax and Alternative
Minimum Tax.--
(1) In general.--Section 25E(b), as added by subsection
(a), is amended--
(A) by striking ``The credit'' and inserting the following:
``(1) Dollar amount.--The credit'', and
(B) by adding at the end the following new paragraph:
``(2) Limitation based on amount of tax.--The credit
allowed under subsection (a) for the taxable year shall not
exceed the excess of--
``(A) the sum of the regular tax liability (as defined in
section 26(b)) plus the tax imposed by section 55, over
``(B) the sum of the credits allowable under this subpart
(other than this section) and section 27 for the taxable
year.''.
(2) Conforming amendments.--
(A) Section 25E(c), as added by subsection (a), is amended
by striking ``section 26(a) for such taxable year reduced by
the sum of the credits allowable under this subpart (other
than this section)'' and inserting ``subsection (b)(2)''.
(B) Section 23(b)(4)(B), as amended by this Act, is amended
by striking ``sections 25C and 25D'' and inserting ``sections
25C, 25D, and 25E''.
(C) Section 24(b)(3)(B), as amended by this Act, is amended
by striking ``and 25D'' and inserting ``25D, and 25E''.
(D) Section 25(e)(1)(C), as amended by this Act, is amended
by inserting ``25E,'' after ``25D,''.
(E) Section 25B(g)(2), as amended by this Act, is amended
by striking ``23, 25C, and 25D'' and inserting ``23, 25C,
25D, and 25E''.
(F) Section 26(a)(1), as amended by this Act, is amended by
striking ``and 25D'' and inserting ``25D, and 25E''.
(G) Section 904(h), as amended by this Act, is amended by
striking ``and 25D'' and inserting ``25D, and 25E''.
(H) Section 1400C(d), as amended by this Act, is amended by
striking ``and 25D'' and inserting ``25D, and 25E''.
(c) Additional Conforming Amendments.--
(1) Section 23(c), as in effect for taxable years beginning
before January 1, 2004, and as amended by this Act, is
amended by inserting ``, 25E,'' after ``sections 25D''.
(2) Section 25(e)(1)(C), as in effect for taxable years
beginning before January 1, 2004, and as amended by this Act,
is amended by inserting ``25E,'' after ``25D,''.
(3) Section 1016(a), as amended by this Act, is amended by
striking ``and'' at the end of paragraph (33), by striking
the period at the end of paragraph (34) and inserting ``;
and'', and by adding at the end the following new paragraph:
``(35) to the extent provided in section 25E(e)(3), in the
case of amounts with respect to which a credit has been
allowed under section 25E.''.
(4) Section 1400C(d), as in effect for taxable years
beginning before January 1, 2004, and as amended by this Act,
is amended by striking ``sections 25C and 25D'' and inserting
``sections 25C, 25D, and 25E''.
(5) The table of sections for subpart A of part IV of
subchapter A of chapter 1, as amended by this Act, is amended
by inserting after the item relating to section 25D the
following new item:

``Sec. 25E. Replacement natural gas or propane furnace or boiler.''.
(d) Effective Dates.--
(1) In general.--Except as provided by paragraph (2), the
amendments made by this section shall apply to property
installed after the date of the enactment of this Act, in
taxable years ending after such date.
(2) Subsection (b).--The amendments made by subsection (b)
shall apply to taxable years beginning after December 31,
2003.
______

SA 1490. Mr. CONRAD (for himself and Mr. Dorgan) submitted an
amendment intended to be proposed by him to the bill S. 14, to enhance
the energy security of the United States, and for other purposes; which
was ordered to lie on the table; as follows:

In division B, beginning on page 220, line 21, strike all
through page 221, line 2, and insert the following:
(c) Extension and Expansion for Certain Fuel Produced at
Existing Facilities.--
(1) Extension.--Section 29(f)(2) (relating to application
of section) is amended by inserting ``(January 1, 2007, in
the case of any coke, coke gas, or natural gas and byproducts
produced by coal gasification from lignite in a facility
described in paragraph (1)(B))'' after ``January 1, 2003''.
(2) Transferability of credit.--Section 29, as amended by
subsection (a), is amended by adding the end the following
new subsection;
``(i) Treatment of Persons Not Able To Use Entire Credit.--
``(1) Allowance of credit.--
``(A) In general.--Any credit allowable under subsection
(a) with respect to any natural gas and byproducts produced
by coal gasification from lignite in a facility described in
paragraph (1)(B) owned by a person described in subparagraph
(B) may be transferred or used as provided in this subsection
and the determination as whether the credit allowable shall
be made without regard to the tax-exempt status of the
person.''.
``(B) Persons described.--A person is described in this
subparagraph if the person is--
``(i) an organization described in section 501(c)(12)(C)
and exempt from tax under section 501(a),
``(ii) an organization described in section 1381(a)(2)(C)
or subsidiaries of such organization,
``(iii) a public utility (as defined in section
136(c)(2)(B)), which is exempt from income tax under this
subtitle,
``(iv) any State or political subdivision thereof, the
District of Columbia, any possession of the United States, or
any agency or instrumentality of any of the foregoing, or
``(v) any Indian tribal government (within the meaning of
section 7871) or any agency or instrumentality thereof.
``(2) Transfer of credit.--
``(A) In general.--A person described in paragraph (1)(B)
may transfer any credit to

[[Page S10718]]

which paragraph (1)(A) applies through an assignment to any
other person not described in paragraph (1)(B). Such transfer
may be revoked only with the consent of the Secretary.
``(B) Regulations.--The Secretary shall prescribe such
regulations as necessary to ensure that any credit described
in subparagraph (a) is assigned once and not reassigned by
such other person.
``(C) Transfer proceeds treated as arising from essential
government function.--Any proceeds derived by a person
described in clause (iii), (iv), or (v) of paragraph (1)(B)
from the transfer of any credit under subparagraph (A) shall
be treated as arising from the exercise of an essential
government function.
``(3) Use of credit as an offset.--Notwithstanding any
other provision of law, in the case of a person described in
clause (i), (ii), or (v) of paragraph (1)(B), any credit to
which paragraph (1)(A) applies may be applied by such person,
to the extent provided by the Secretary of Agriculture, as a
prepayment of any loan, debt, or other obligation the entity
has incurred under subchapter I of chapter 31 of title 7 of
the Rural Electrification Act of 1936 (7 U.S.C. 901 et seq.),
as in effect on the date of the enactment of the Energy Tax
Incentives Act of 2003.
``(4) Credit not income.--Any transfer under paragraph (2)
or use under paragraph (3) of any credit to which paragraph
(1)(A) applies shall not be treated as income for purposes of
this title.
``(5) Treatment of unrelated persons.--For purposes of
subsection (a)(2)(A), sales of qualified fuels among and
between persons described in paragraph (1)(B) shall be
treated as sales between unrelated parties.''.
______

SA 1491. Mr. CONRAD submitted an amendment intended to be proposed by
him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of title II of division B, insert the following:

SEC. 210. CREDIT FOR QUALIFYING POLLUTION CONTROL EQUIPMENT.

(a) Allowance of Qualifying Pollution Control Equipment
Credit.--Section 46 (relating to amount of credit), as
amended by this Act, 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 new paragraph:
``(5) the qualifying pollution control equipment credit.''.
(b) Amount of Qualifying Pollution Control Equipment
Credit.--Subpart E of part IV of subchapter A of chapter 1
(relating to rules for computing investment credit), as
amended by this Act, is amended by inserting after section
48A the following new section:

``SEC. 48B. QUALIFYING POLLUTION CONTROL EQUIPMENT CREDIT.

``(a) In General.--For purposes of section 46, the
qualifying pollution control equipment credit for any taxable
year is an amount equal to 15 percent of the basis of the
qualifying pollution control equipment placed in service at a
qualifying facility during such taxable year.
``(b) Qualifying Pollution Control Equipment.--For purposes
of this section, the term `qualifying pollution control
equipment' means any technology installed in or on a
qualifying facility to reduce air emissions of any pollutant
regulated by the Environmental Protection Agency under the
Clean Air Act, including thermal oxidizers, regenerative
thermal oxidizers, scrubber systems, evaporative control
systems, vapor recovery systems, flair systems, bag houses,
cyclones, continuous emissions monitoring systems, and low
nitric oxide burners.
``(c) Qualifying Facility.--For purposes of this section,
the term `qualifying facility' means any facility the
exclusive use of which is for the production of ethanol.
``(d) Special Rule for Certain Subsidized Property.--Rules
similar to section 48(a)(6) shall apply for purposes of this
section.
``(e) Certain Qualified Progress Expenditures 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
enactment of the Revenue Reconciliation Act of 1990) shall
apply for purposes of this subsection.''.
(c) Special Rule for Basis Reduction; Recapture of
Credit.--Paragraph (3) of section 50(c) (relating to basis
adjustment to investment credit property) is amended by
inserting ``or qualifying pollution control equipment
credit'' after ``reforestation credit''.
(d) Effective Date.--The amendments made by this section
shall apply to property placed in service after December 31,
2001, in taxable years ending after such date, 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).
______

SA 1492. Mr. DURBIN (for himself and Ms. Stabenow) submitted an
amendment intended to be proposed by him to the bill S. 14, to enhance
the energy security of the United States, and for other purposes; which
was ordered to lie on the table; as follows:

At the appropriate place insert the following:

SEC. ____ CONSUMER AND SMALL BUSINESS ENERGY COMMISSION.

(a) Findings.--Congress finds that--
(1) there have been several sharp increases since 1990 in
the price of electricity, gasoline, home heating oil, natural
gas, and propane in the United States;
(2) recent examples of such increases include--
(A) unusually high gasoline prices that are at least partly
attributable to global politics;
(B) electricity price spikes during the California energy
crisis of 2001; and
(C) the Midwest gasoline price spikes in spring 2001;
(3) shifts in energy regulation, including the allowance of
greater flexibility in competition and trading, have affected
price stability and consumers in ways that are not fully
understood;
(4) price spikes undermine the ability of low-income
families, the elderly, and small businesses (including
farmers and other agricultural producers) to afford essential
energy services and products;
(5) energy price spikes can exacerbate a weak economy by
creating uncertainties that discourage investment, growth,
and other activities that contribute to a strong economy;
(6) the Department of Energy has determined that the
economy would be likely to perform better with stable or
predictable energy prices;
(7) price spikes can be caused by many factors, including
insufficient inventories, supply disruptions, refinery
capacity limits, insufficient infrastructure, over-regulation
or under-regulation, flawed deregulation, excessive
consumption, over-reliance on foreign supplies, insufficient
research and development of alternative energy sources,
opportunistic behavior by energy companies, and abuses of
market power;
(8) consumers and small businesses have few options other
than to pay higher energy costs when prices spike, resulting
in reduced investment and slower economic growth and job
creation;
(9) the effect of price spikes, and possible responses to
price spikes, on consumers and small businesses should be
examined; and
(10) studies have examined price spikes of specific energy
products in specific contexts or for specific reasons, but no
study has examined price spikes comprehensively with a focus
on the impacts on consumers and small businesses.
(b) Definitions.--In this section:
(1) Commission.--The term ``Commission'' means the Consumer
and Small Business Energy Commission established by
subsection (c)(1).
(2) Consumer energy product.--The term ``consumer energy
product'' means--
(A) electricity;
(B) gasoline;
(C) home heating oil;
(D) natural gas; and
(E) propane.
(3) Consumer group focusing on energy issues.--The term
``consumer group focusing on energy issues'' means--
(A) an organization that is a member of the National
Association of State Utility Consumer Advocates;
(B) a nongovernmental organization representing the
interests of residential energy consumers; and
(C) a nongovernmental organization that--
(i) receives not more than \1/4\ of its funding from energy
industries; and
(ii) represent the interests of energy consumers.
(4) Energy consumer.--The term ``energy consumer'' means an
individual or small business that purchases 1 or more
consumer energy products.
(5) Energy industry.--The term ``energy industry'' means
for-profit or not-for-profit entities involved in the
generation, selling, or buying of any energy-producing fuel
involved in the production or use of consumer energy
products.
(6) Executive committee.--The term ``Executive Committee''
means the executive committee of the Commission.
(7) Small business.--The term ``small business'' has the
meaning given the term ``small business concern'' in section
3(a) of the Small Business Act (15 U.S.C. 632(a)).
(c) Consumer Energy Commission.--
(1) Establishment.--There is established a commission to be
known as the ``Consumer and Small Business Energy
Commission''.
(2) Membership.--
(A) In general.--The Commission shall be comprised of 20
members.
(B) Appointments by the senate and house of
representatives.--The majority leader and minority leader of
the Senate and the Speaker and minority leader of the House
of Representatives shall each appoint 4 members, of whom--
(i) 2 shall represent consumer groups focusing on energy
issues;
(ii) 1 shall represent small businesses; and
(iii) 1 shall represent the energy industry.
(C) Appointments by the president.--The President shall
appoint 1 member from each of--
(i) the Energy Information Administration of the Department
of Energy;
(ii) the Federal Energy Regulatory Commission;
(iii) the Federal Trade Commission; and
(iv) the Commodities Future Trading Commission.
(D) Date of appointments.--The appointment of a member of
the Commission shall be made not later than 30 days after the
date of enactment of this Act.

[[Page S10719]]

(3) Term.--A member shall be appointed for the life of the
Commission.
(4) Initial meeting.--The Commission shall hold the initial
meeting of the Commission not later than the earlier of--
(A) the date that is 30 days after the date on which all
members of the Commission have been appointed; or
(B) the date that is 90 days after the date of enactment of
this Act, regardless of whether all members have been
appointed.
(5) Chairperson and vice chairperson.--The Commission shall
select a Chairperson and Vice Chairperson from among the
members of the Commission, excluding the members appointed
under clauses (ii), (iii), and (iv) of paragraph (2)(C).
(6) Executive committee.--The Commission shall have an
executive committee comprised of all members of the
Commission except the members appointed under clauses (ii),
(iii), and (iv) of paragraph (2)(C).
(7) Information and administrative expenses.--The Federal
agencies specified in paragraph (2)(C) shall provide the
Commission such information and pay such administrative
expenses as the Commission requires to carry out this
section, consistent with the requirements and guidelines of
the Federal Advisory Commission Act (5 U.S.C. App.).
(8) Duties.--
(A) Study.--
(i) In general.--The Commission shall conduct a nationwide
study of significant price spikes in major United States
consumer energy products since 1990.
(ii) Matters to be studied by the commission.--In
conducting the study, the Commission shall--

(I) focus on the causes of the price spikes, including
insufficient inventories, supply disruptions, refinery
capacity limits, insufficient infrastructure, any over-
regulation or under-regulation, flawed deregulation,
excessive consumption, over-reliance on foreign supplies,
insufficient research and development of alternative energy
sources, opportunistic behavior by energy companies, and
abuses of market power;
(II) examine the effects of price spikes on consumers and
small businesses;
(III) investigate market concentration, opportunities for
misuse of market power, and any other relevant market
failures; and
(IV) consider--

(aa) proposals for administrative actions to mitigate price
spikes affecting consumers and small businesses;
(bb) proposals for legislative action; and
(cc) proposals for voluntary actions by energy consumers
and the energy industry.
(B) Report.--Not later than 270 days after the date of
enactment of this Act, the Executive Committee shall submit
to Congress a report that contains--
(i) a detailed statement of the findings and conclusions of
the Commission; and
(ii) recommendations for legislation, administrative
actions, and voluntary actions by energy consumers and the
energy industry to protect consumers from future price spikes
in consumer energy products, including a recommendation on
whether energy consumers need an advocate on energy issues
within the Federal Government.
(9) Termination.--
(A) Definition of legislative day.--In this subsection, the
term ``legislative day'' means a day on which both Houses of
Congress are in session.
(B) Date of termination.--The Commission shall terminate on
the date that is 30 legislative days after the date of
submission of the report under paragraph (8)(B).
______

SA 1493. Mr. ROCKEFELLER submitted an amendment intended to be
proposed by him to the bill S. 14, to enhance the energy security of
the United States, and for other purposes; which was ordered to lie on
the table; as follows:

On page 153, strike lines 13 and 14 and insert the
following:
``(B) uses an input of at least 75 percent coal to produce
50 percent or more of its thermal output as electricity,
______

SA 1494. Mr. ROCKEFELLER submitted an amendment intended to be
proposed by him to the bill S. 14, to enhance the energy security of
the United States, and for other purposes; which was ordered to lie on
the table; as follows:

Beginning on page 157, strike line 22 and all that follows
through page 158, line 2, and insert the following:
(2) The term ``renewable energy'' means--
(A) electric energy generated from a solar, wind, biomass,
geothermal, or municipal solid waste source;
(B) new hydroelectric generation capacity achieved from
increased efficiency or additions of new capacity at an
existing hydroelectric project; and
(C) hydroelectric energy generated at a hydroelectric
facility that--
(i) is constructed and operated under an order of the
Federal Energy Regulatory Commission issued before January 1,
2003;
(ii) is located at a federally owned dam; and
(iii) is placed in service on or after the date of
enactment of this Act.
______

SA 1495. Mr. ROCKEFELLER (for himself and Mr. Santorum) submitted an
amendment intended to be proposed by him to the bill S. 14, to enhance
the energy security of the United States, and for other purposes; which
was ordered to lie on the table; as follows:

On page 218 of Division B, after line 23, insert the
following:
``(6) Facilities producing coke.--
``(A) In general.--In the case of a facility described in
subparagraph (C) for producing coke which was placed in
service after the date of the enactment of this subsection
and before January 1, 2007, this section shall apply with
respect to fuel produced at such facility before the close of
the 5-year period beginning on the date such facility is
placed in service.
``(B) Coke.--For purposes of this paragraph, the term
`coke' means the residue from the destructive distillation of
coal in coke ovens.
``(C) Covered facilities.--A facility is described in this
paragraph if such facility qualifies as a new source under
section 112 of the Clean Air Act (42 U.S.C. 7412).
On page 219, line 1, strike ``(6)'' and insert ``(7)''.
______

SA 1496. Mr. HARKIN submitted an amendment intended to be proposed by
him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of title VII of division B, insert the
following:

SEC. ____. OFFSET OF PASSIVE ACTIVITY LOSSES AND CREDITS OF
AN ELIGIBLE TAXPAYER FROM WIND ENERGY
FACILITIES.

(a) In General.--Section 469 (relating to passive activity
losses and credits limited) is amended by redesignating
subsections (l) and (m) as subsections (m) and (n) and by
inserting after subsection (k) the following new subsection:
``(l) Offset of Passive Activity Losses and Credits From
Wind Energy Facilities.--
``(1) In general.--Subsection (a) shall not apply to the
portion of the passive activity loss, or the deduction
equivalent (within the meaning of subsection (j)(5)) of the
portion of the passive activity credit, for any taxable year
which is attributable to all interests of an eligible
taxpayer in qualified facilities described in section
45(c)(3)(A).
``(2) Eligible taxpayer.--For purposes of this subsection--
``(A) In general.--The term `eligible taxpayer' means, with
respect to any taxable year, a taxpayer the adjusted gross
income (taxable income in the case of a corporation) of which
does not exceed $1,000,000.
``(B) Rules for computing adjusted gross income.--Adjusted
gross income shall be computed in the same manner as under
subsection (i)(3)(F).
``(C) Aggregation rules.--All persons treated as a single
employer under subsection (a) or (b) of section 52 shall be
treated as a single taxpayer for purposes of this paragraph.
``(D) Pass-thru entities.--In the case of a pass-thru
entity, this paragraph shall be applied at the level of the
person to which the credit is allocated by the entity.''
(b) Effective Date.--The amendments made by this section
shall apply to facilities placed in service after the date of
the enactment of this Act.

SEC. ____. CREDIT FOR WIND ENERGY FACILITIES OF AN ELIGIBLE
TAXPAYER ALLOWED AGAINST MINIMUM TAX.

(a) In General.--Section 38(c) (relating to limitation
based on amount of tax) is amended by redesignating paragraph
(6) as paragraph (7) and by inserting after paragraph (5) the
following new paragraph:
``(6) Special rules for wind energy credit.--
``(A) In general.--In the case of the wind energy credit of
an eligible taxpayer--
``(i) this section and section 39 shall be applied
separately with respect to such credit, and
``(ii) in applying paragraph (1) to the credit--

``(I) the tentative minimum tax shall be treated as being
zero, 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 wind
energy credit).

``(B) Wind energy credit.--For purposes of this subsection,
the term `wind energy credit' means the portion of the
renewable electric production credit under section 45
determined with respect to a facility using wind to produce
electricity.
``(C) Eligible taxpayer.--For purposes of this paragraph,
the term `eligible taxpayer' has the meaning given such term
by section 469(l)(2).''
(b) Conforming Amendments.--Subclause (II) of section
38(c)(2)(A)(ii), as amended by this Act, subclause (II) of
section 38(c)(3)(A)(ii), as amended by this Act, subclause
(II) of section 38(c)(4)(A)(ii), as added by this Act, and
subclause (II) of section 38(c)(5)(A)(ii), as added by this
Act, are each amended by inserting ``or wind energy credit''
after ``natural gas''.
(c) Effective Date.--The amendments made by this section
shall apply to taxable years ending after the date of the
enactment of this Act.

SEC. 4. APPLICATION OF CREDIT TO COOPERATIVES.

(a) In General.--Section 45(e), as redesignated and amended
by this Act, (relating to

[[Page S10720]]

definitions and special rules) is amended by adding at the
end the following new paragraph:
``(9) Allocation of credit to shareholders of
cooperative.--
``(A) Election to allocate.--
``(i) In general.--In the case of a cooperative
organization described in section 1381(a), any portion of the
credit determined under subsection (a) for the taxable year
may, at the election of the organization, be apportioned pro
rata among shareholders of the organization on the basis of
the capital contributions of the shareholders to the
organization.
``(ii) Form and effect of election.--An election under
clause (i) for any taxable year shall be made on a timely
filed return for such year. Such election, once made, shall
be irrevocable for such taxable year.
``(B) Treatment of organizations and patrons.--The amount
of the credit apportioned to any shareholders under
subparagraph (A)--
``(i) shall not be included in the amount determined under
subsection (a) with respect to the organization for the
taxable year, and
``(ii) shall be included in the amount determined under
subsection (a) for the taxable year of the shareholder with
or within which the taxable year of the organization ends.
``(C) Special rules for decrease in credits for taxable
year.--If the amount of the credit of a cooperative
organization determined under subsection (a) for a taxable
year is less than the amount of such credit shown on the
return of the cooperative organization for such year, an
amount equal to the excess of--
``(i) such reduction, over
``(ii) the amount not apportioned to such shareholders
under subparagraph (A) for the taxable year,

shall be treated as an increase in tax imposed by this
chapter on the organization. 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.''.
(b) Effective Date.--The amendments made by this section
shall apply to taxable years ending after the date of the
enactment of this Act.
______

SA 1497. Mr. HARKIN submitted an amendment intended to be proposed by
him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of title I of division B, insert the following:

SEC.   . FURTHER MODIFICATIONS TO CREDIT FOR ELECTRICITY
PRODUCED FROM CERTAIN RENEWABLE RESOURCES.

(a) Extension of Placed in Service Date.--
(1) In general.--Section 45(c), as amended by this Act, is
amended by striking ``January 1, 2007'' each place it appears
and inserting ``January 1, 2014''.
(2) Biomass.--Paragraph (3)(A)(ii) of section 45(c), as
amended by this Act, is amended by striking ``January 1,
2005'' and inserting ``January 1, 2014''.
(b) Restoration of Inflation Adjustment.--Section 45(b)(2),
as amended by this Act, is amended by striking the last
sentence.
(c) Credit Allowable for Production of hydrogen.--Section
45, as amended by this Act, is amended by inserting at the
end the following new subsection:
``(f) Hydrogen Produced From Renewable Resources.--
``(1) In general.--In the case of hydrogen produced from
qualified energy sources at qualified facilities, subsection
(a) shall be applied by substituting `the hydrogen kilowatt
hour equivalent unit' for `the kilowatt hours of electricity'
in paragraph (2).
``(2) Hydrogen kilowatt hour equivalent unit.--For purposes
of this section, the term `hydrogen kilowatt hour equivalent
unit' means each measurement of hydrogen having the Btu
equivalent of one kilowatt hour of electricity, as determined
by the Secretary in consultation with the Secretary of
Energy.''.
(d) Effective Date.--
(1) Subsection  (a).--The amendments made by subsection (a)
shall take effect as if included in the provisions of section
101 to which they relate.
(2) Subsection (b).--The amendments made by subsections (b)
and (c) shall apply to electricity produced and sold after
December 31, 2004, in taxable years ending after such date.
(3) Subsection (c).--The amendments made by subsection (c)
shall apply to hydrogen produced and sold after December 31,
2004, in taxable years ending after such date.
______

SA 1498. Mr. JEFFORDS submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of subtitle G of title IX, add the following:

SEC. 9____. FEDERAL GOVERNMENT GREENHOUSE GAS EMISSIONS GOAL.

(a) Actions.--Not later than January 1, 2004, the President
shall take such actions as are necessary, including preparing
and submitting to Congress any necessary statutory changes,
to reduce the net greenhouse gas emissions of the Federal
Government to 1990 levels by 2013, including steps to
procure--
(1) only highly energy-efficient products, services, and
facilities;
(2) electricity generated from renewable sources; and
(3) alternative fuel vehicles.
(b) Report.--The President shall direct the appropriate
Federal agencies to study and submit to Congress, not later
than July 1, 2005, a report on the most cost-effective policy
options through which the Federal Government could reduce the
net greenhouse gas emissions of the Federal Government to
zero by 2025.
______

SA 1499. Mr. JEFFORDS submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 372, between lines 4 and 5, insert the following:

SEC. 97  . GLOBAL CLIMATE CHANGE RESEARCH AND DEVELOPMENT.

No later than July 1, 2004, the Chairman of the Council on
Environmental Quality, in consultation with the Administrator
of the Environmental Protection Agency, the Secretary of
Energy, the Secretary of the Interior, the Secretary of
Agriculture, the Secretary of Commerce, the Administrator of
the National Aeronautic and Space Administration, and
representatives of States, academic institutions,
environmental groups, and the public, shall submit to
Congress a report that includes--
(1) a definition of the term ``dangerous anthropogenic
interference with the climate system'', as used in the United
Nations Framework Convention on Climate Change; and
(2) a description of each of the specific elements of the
global climate change research and development activities of
the United States that are directed at detecting and averting
that interference.
______

SA 1500. Mr. JEFFORDS submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of subtitle G of title IX, add the following:

SEC. 9   . CLIMATE CHANGE IN ENVIRONMENTAL IMPACT STATEMENTS.

In any case in which a Federal agency prepares an
environmental impact statement or similar analysis required
under the National Environmental Policy Act of 1969 (42
U.S.C. 4321 et seq.), the Federal agency shall consider and
evaluate--
(1) the impact that the Federal action or project
necessitating the statement or analysis will have in terms of
net changes in greenhouse gas emissions; and
(2) how climate changes may affect the action or project in
the short term and the long term.
______

SA 1501. Mr. JEFFORDS submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of subtitle G of title IX, add the following:

SEC. 9   . GRANTS FOR REDUCTION OF GREENHOUSE GAS EMISSIONS.

(a) In General.--The President, acting through the
Secretary of Agriculture, the Secretary of Commerce, the
Secretary of Energy, and the Administrator of the
Environmental Protection Agency, may provide grants to States
or local governments for the purpose of--
(1) preparing, completing, or operating greenhouse gas data
collection, inventory, or trading systems;
(2) implementing greenhouse gas emission reduction or
sequestration projects, including programs conducted jointly
with industry or nonprofit organizations; and
(3) conducting research, long-term planning, and modeling
efforts intended to reduce net greenhouse gas emissions in
the United States through sustainable economic development.
(b) Set Aside for Most Effective Projects.--For each fiscal
year, 50 percent of the grant funds awarded under subsection
(a) shall be awarded competitively for projects that will
reduce net greenhouse gas emissions--
(1) in the greatest quantity;
(2) most rapidly; and
(3) with the greatest degree of permanence.
(c) Annual Reporting by Grant Recipients.--As a condition
of receipt of a grant under this section, each recipient
shall submit to the Federal agency that provided the grant an
annual report on the extent to which the emission reductions
that were anticipated in the application for the grant have
occurred.
(d) Annual Summary.--The President shall annually compile
and publish in the Federal Register a summary of--
(1) the grants made under this section; and
(2) the net emission reductions due to the activities
assisted with the grants.
(e) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $2,000,000,000
for each fiscal year.
______

SA 1502. Mr. JEFFORDS submitted an amendment intended to be proposed

[[Page S10721]]

by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end, add the following:

TITLE ____--GREENHOUSE GAS EMISSIONS

SEC. ____01. SHORT TITLE.

This title may be cited as the ``National Greenhouse Gas
Emissions Inventory and Registry Act of 2003''.

SEC. ____02. FINDINGS AND PURPOSE.

(a) Findings.--Congress finds that--
(1) human activities have caused rapid increases in
atmospheric concentrations of carbon dioxide and other
greenhouse gases in the last century;
(2) according to the Intergovernmental Panel on Climate
Change and the National Research Council--
(A) the Earth has warmed in the last century; and
(B) the majority of the observed warming is attributable to
human activities;
(3) despite the fact that many uncertainties in climate
science remain, the potential impacts from human-induced
climate change pose a substantial risk that should be managed
in a responsible manner; and
(4) to begin to manage climate change risks, public and
private entities will need a comprehensive, accurate
inventory, registry, and information system of the sources
and quantities of United States greenhouse gas emissions.
(b) Purpose.--The purpose of this title is to establish a
mandatory greenhouse gas inventory, registry, and information
system that--
(1) is complete, consistent, transparent, and accurate;
(2) will create accurate data that can be used by public
and private entities to design efficient and effective
greenhouse gas emission reduction strategies;
(3) will encourage greenhouse gas emission reductions; and
(4) can be used to establish a baseline in the event of any
future greenhouse gas emission reduction requirements
affecting major emitters in the United States.

SEC. ____03. GREENHOUSE GAS EMISSIONS.

The Clean Air Act (42 U.S.C. 1701 et seq.) is amended by
adding at the end the following:

``TITLE VII--GREENHOUSE GAS EMISSIONS

``SEC. 701. DEFINITIONS.

``In this title:
``(1) Covered entity.--The term `covered entity' means an
entity that emits more than a threshold quantity of
greenhouse gas emissions.
``(2) Direct emissions.--The term `direct emissions' means
greenhouse gas emissions from a source that is owned or
controlled by an entity.
``(3) Entity.--The term `entity' includes a firm, a
corporation, an association, a partnership, and a Federal
agency.
``(4) Greenhouse gas.--The term `greenhouse gas' means--
``(A) carbon dioxide;
``(B) methane;
``(C) nitrous oxide;
``(D) hydrofluorocarbons;
``(E) perfluorocarbons; and
``(F) sulfur hexafluoride.
``(5) Greenhouse gas emissions.--The term `greenhouse gas
emissions' means emissions of a greenhouse gas, including--
``(A) stationary combustion source emissions, which are
emitted as a result of combustion of fuels in stationary
equipment such as boilers, furnaces, burners, turbines,
heaters, incinerators, engines, flares, and other similar
sources;
``(B) process emissions, which consist of emissions from
chemical or physical processes other than combustion;
``(C) fugitive emissions, which consist of intentional and
unintentional emissions from--
``(i) equipment leaks such as joints, seals, packing, and
gaskets; and
``(ii) piles, pits, cooling towers, and other similar
sources; and
``(D) mobile source emissions, which are emitted as a
result of combustion of fuels in transportation equipment
such as automobiles, trucks, trains, airplanes, and vessels.
``(6) Greenhouse gas emissions record.--The term
`greenhouse gas emissions record' means all of the historical
greenhouse gas emissions and project reduction data submitted
by an entity under this title, including any adjustments to
such data under section 704(c).
``(7) Greenhouse gas report.--The term `greenhouse gas
report' means an annual list of the greenhouse gas emissions
of an entity and the sources of those emissions.
``(8) Indirect emissions.--The term `indirect emissions'
means greenhouse gas emissions that are a consequence of the
activities of an entity but that are emitted from sources
owned or controlled by another entity.
``(9) National greenhouse gas emissions information
system.--The term `national greenhouse gas emissions
information system' means the information system established
under section 702(a).
``(10) National greenhouse gas emissions inventory.--The
term `national greenhouse gas emissions inventory' means the
national inventory of greenhouse gas emissions established
under section 705.
``(11) National greenhouse gas registry.--The term
`national greenhouse gas registry' means the national
greenhouse gas registry established under section 703(a).
``(12) Project reduction.--The term `project reduction'
means--
``(A) a greenhouse gas emission reduction achieved by
carrying out a greenhouse gas emission reduction project; and
``(B) sequestration achieved by carrying out a
sequestration project.
``(13) Reporting entity.--The term `reporting entity' means
an entity that reports to the Administrator under subsection
(a) or (b) of section 704.
``(14) Sequestration.--The term `sequestration' means the
long-term separation, isolation, or removal of greenhouse
gases from the atmosphere, including through a biological or
geologic method such as reforestation or an underground
reservoir.
``(15) Threshold quantity.--The term `threshold quantity'
means a threshold quantity for mandatory greenhouse gas
reporting established by the Administrator under section
704(a)(3).
``(16) Verification.--The term `verification' means the
objective and independent assessment of whether a greenhouse
gas report submitted by a reporting entity accurately
reflects the greenhouse gas impact of the reporting entity.

``SEC. 702. NATIONAL GREENHOUSE GAS EMISSIONS INFORMATION
SYSTEM.

``(a) Establishment.--In consultation with the Secretary of
Commerce, the Secretary of Agriculture, the Secretary of
Energy, States, the private sector, and nongovernmental
organizations concerned with establishing standards for
reporting of greenhouse gas emissions, the Administrator
shall establish and administer a national greenhouse gas
emissions information system to collect information reported
under section 704(a).
``(b) Submission to Congress of Draft Design.--Not later
than 180 days after the date of enactment of this title, the
Administrator shall submit to Congress a draft design of the
national greenhouse gas emissions information system.
``(c) Availability of Data to the Public.--The
Administrator shall publish all information in the national
greenhouse gas emissions information system through the
website of the Environmental Protection Agency, except in any
case in which publishing the information would reveal a trade
secret or disclose information vital to national security.
``(d) Relationship to Other Greenhouse Gas Registries.--To
the extent practicable, the Administrator shall ensure
coordination between the national greenhouse gas emissions
information system and existing and developing Federal,
regional, and State greenhouse gas registries.
``(e) Integration With Other Environmental Information.--To
the extent practicable, the Administrator shall integrate
information in the national greenhouse gas emissions
information system with other environmental information
managed by the Administrator.

``SEC. 703. NATIONAL GREENHOUSE GAS REGISTRY.

``(a) Establishment.--In consultation with the Secretary of
Commerce, the Secretary of Agriculture, the Secretary of
Energy, States, the private sector, and nongovernmental
organizations concerned with establishing standards for
reporting of greenhouse gas emissions, the Administrator
shall establish and administer a national greenhouse gas
registry to collect information reported under section
704(b).
``(b) Availability of Data to the Public.--The
Administrator shall publish all information in the national
greenhouse gas registry through the website of the
Environmental Protection Agency, except in any case in which
publishing the information would reveal a trade secret or
disclose information vital to national security.
``(c) Relationship to Other Greenhouse Gas Registries.--To
the maximum extent feasible and practicable, the
Administrator shall ensure coordination between the national
greenhouse gas registry and existing and developing Federal,
regional, and State greenhouse gas registries.
``(d) Integration With Other Environmental Information.--To
the maximum extent practicable, the Administrator shall
integrate all information in the national greenhouse gas
registry with other environmental information collected by
the Administrator.

``SEC. 704. REPORTING.

``(a) Mandatory Reporting to National Greenhouse Gas
Emissions Information System.--
``(1) Initial reporting requirements.--
``(A) In general.--Not later than April 30, 2004, in
accordance with this paragraph and the regulations
promulgated under section 706(e)(1), each covered entity
shall submit to the Administrator, for inclusion in the
national greenhouse gas emissions information system, the
greenhouse gas report of the covered entity with respect to--
``(i) calendar year 2003; and
``(ii) each greenhouse gas emitted by the covered entity in
an amount that exceeds the applicable threshold quantity.
``(B) Required elements.--Each greenhouse gas report
submitted under subparagraph (A)--
``(i) shall include estimates of direct stationary
combustion source emissions;
``(ii) shall express greenhouse gas emissions in metric
tons of the carbon dioxide equivalent of each greenhouse gas
emitted;
``(iii) shall specify the sources of greenhouse gas
emissions that are included in the greenhouse gas report;

[[Page S10722]]

``(iv) shall be reported on an entity-wide basis and on a
facility-wide basis; and
``(v) to the maximum extent practicable, shall be reported
electronically to the Administrator in such form as the
Administrator may require.
``(C) Method of reporting of entity-wide emissions.--Under
subparagraph (B)(iv), entity-wide emissions shall be reported
on the bases of financial control and equity share in a
manner consistent with the financial reporting practices of
the covered entity.
``(2) Final reporting requirements.--
``(A) In general.--Not later than April 30, 2005, and each
April 30 thereafter (except as provided in subparagraph
(B)(vii)), in accordance with this paragraph and the
regulations promulgated under section 706(e)(2), each covered
entity shall submit to the Administrator the greenhouse gas
report of the covered entity with respect to--
``(i) the preceding calendar year; and
``(ii) each greenhouse gas emitted by the covered entity in
an amount that exceeds the applicable threshold quantity.
``(B) Required elements.--Each greenhouse gas report
submitted under subparagraph (A) shall include--
``(i) the required elements specified in paragraph (1);
``(ii) estimates of indirect emissions from imported
electricity, heat, and steam;
``(iii) estimates of process emissions described in section
701(5)(B);
``(iv) estimates of fugitive emissions described in section
701(5)(C);
``(v) estimates of mobile source emissions described in
section 701(5)(D), in such form as the Administrator may
require;
``(vi) in the case of a covered entity that is a forest
product entity, estimates of direct stationary source
emissions, including emissions resulting from combustion of
biomass;
``(vii) in the case of a covered entity that owns more than
250,000 acres of timberland, estimates, by State, of the
timber and carbon stocks of the covered entity, which
estimates shall be updated every 5 years; and
``(viii) a description of any adjustments to the greenhouse
gas emissions record of the covered entity under subsection
(c).
``(3) Establishment of threshold quantities.--For the
purpose of reporting under this subsection, the Administrator
shall establish threshold quantities of emissions for each
combination of a source and a greenhouse gas that is subject
to the mandatory reporting requirements under this
subsection.
``(b) Voluntary Reporting to National Greenhouse Gas
Registry.--
``(1) In general.--Not later than April 30, 2004, and each
April 30 thereafter, in accordance with this subsection and
the regulations promulgated under section 706(f), an entity
may voluntarily report to the Administrator, for inclusion in
the national greenhouse gas registry, with respect to the
preceding calendar year and any greenhouse gas emitted by the
entity--
``(A) project reductions;
``(B) transfers of project reductions to and from any other
entity;
``(C) project reductions and transfers of project
reductions outside the United States;
``(D) indirect emissions that are not required to be
reported under subsection (a)(2)(B)(ii) (such as product
transport, waste disposal, product substitution, travel, and
employee commuting); and
``(E) product use phase emissions.
``(2) Types of activities.--Under paragraph (1), an entity
may report activities that reduce greenhouse gas emissions or
sequester a greenhouse gas, including--
``(A) fuel switching;
``(B) energy efficiency improvements;
``(C) use of renewable energy;
``(D) use of combined heat and power systems;
``(E) management of cropland, grassland, and grazing land;
``(F) forestry activities that increase carbon stocks;
``(G) carbon capture and storage;
``(H) methane recovery; and
``(I) carbon offset investments.
``(c) Adjustment Factors.--
``(1) In general.--Each reporting entity shall adjust the
greenhouse gas emissions record of the reporting entity in
accordance with this subsection.
``(2) Significant structural changes.--
``(A) In general.--A reporting entity that experiences a
significant structural change in the organization of the
reporting entity (such as a merger, major acquisition, or
divestiture) shall adjust its greenhouse gas emissions record
for preceding years so as to maintain year-to-year
comparability.
``(B) Mid-year changes.--In the case of a reporting entity
that experiences a significant structural change described in
subparagraph (A) during the middle of a year, the greenhouse
gas emissions record of the reporting entity for preceding
years shall be adjusted on a pro-rata basis.
``(3) Calculation changes and errors.--The greenhouse gas
emissions record of a reporting entity for preceding years
shall be adjusted for--
``(A) changes in calculation methodologies; or
``(B) errors that significantly affect the quantity of
greenhouse gases in the greenhouse gas emissions record.
``(4) Organizational growth or decline.--The greenhouse gas
emissions record of a reporting entity for preceding years
shall not be adjusted for any organizational growth or
decline of the reporting entity such as--
``(A) an increase or decrease in production output;
``(B) a change in product mix;
``(C) a plant closure; and
``(D) the opening of a new plant.
``(5) Explanations of adjustments.--A reporting entity
shall explain, in a statement included in the greenhouse gas
report of the reporting entity for a year--
``(A) any significant adjustment in the greenhouse gas
emissions record of the reporting entity; and
``(B) any significant change between the greenhouse gas
emissions record for the preceding year and the greenhouse
gas emissions reported for the current year.
``(d) Quantification and Verification Protocols and
Tools.--
``(1) In general.--The Administrator and the Secretary of
Commerce, the Secretary of Agriculture, and the Secretary of
Energy shall jointly work with the States, the private
sector, and nongovernmental organizations to develop--
``(A) protocols for quantification and verification of
greenhouse gas emissions;
``(B) electronic methods for quantification and reporting
of greenhouse gas emissions; and
``(C) greenhouse gas accounting and reporting standards.
``(2) Best practices.--The protocols and methods developed
under paragraph (1) shall conform, to the maximum extent
practicable, to the best practice protocols that have the
greatest support of experts in the field.
``(3) Incorporation into regulations.--The Administrator
shall incorporate the protocols developed under paragraph
(1)(A) into the regulations promulgated under section 706.
``(4) Outreach program.--The Administrator, the Secretary
of Commerce, the Secretary of Agriculture, and the Secretary
of Energy shall jointly conduct an outreach program to
provide information to all reporting entities and the public
on the protocols and methods developed under this subsection.
``(e) Verification.--
``(1) Provision of information by reporting entities.--Each
reporting entity shall provide information sufficient for the
Administrator to verify, in accordance with greenhouse gas
accounting and reporting standards developed under subsection
(d)(1)(C), that the greenhouse gas report of the reporting
entity--
``(A) has been accurately reported; and
``(B) in the case of each project reduction, represents
actual reductions in greenhouse gas emissions or actual
increases in net sequestration, as applicable.
``(2) Independent third-party verification.--A reporting
entity may--
``(A) obtain independent third-party verification; and
``(B) present the results of the third-party verification
to the Administrator for consideration by the Administrator
in carrying out paragraph (1).
``(f) Enforcement.--The Administrator may bring a civil
action in United States district court against a covered
entity that fails to comply with subsection (a), or a
regulation promulgated under section 706(e), to impose a
civil penalty of not more than $25,000 for each day that the
failure to comply continues.

``SEC. 705. NATIONAL GREENHOUSE GAS EMISSIONS INVENTORY.

``Not later than April 30, 2004, and each April 30
thereafter, the Administrator shall publish a national
greenhouse gas emissions inventory that includes--
``(1) comprehensive estimates of the quantity of United
States greenhouse gas emissions for the second preceding
calendar year, including--
``(A) for each greenhouse gas, an estimate of the quantity
of emissions contributed by each key source category;
``(B) a detailed analysis of trends in the quantity,
composition, and sources of United States greenhouse gas
emissions; and
``(C) a detailed explanation of the methodology used in
developing the national greenhouse gas emissions inventory;
and
``(2) a detailed analysis of the information reported to
the national greenhouse gas emissions information system and
the national greenhouse gas registry.

``SEC. 706. REGULATIONS.

``(a) In General.--The Administrator may promulgate such
regulations as are necessary to carry out this title.
``(b) Best Practices.--In developing regulations under this
section, the Administrator shall seek to leverage leading
protocols for the measurement, accounting, reporting, and
verification of greenhouse gas emissions.
``(c) National Greenhouse Gas Emissions Information
System.--Not later than January 31, 2004, the Administrator
shall promulgate such regulations as are necessary to
establish the national greenhouse gas emissions information
system.
``(d) National Greenhouse Gas Registry.--Not later than
January 31, 2004, the Administrator shall promulgate such
regulations as are necessary to establish the national
greenhouse gas registry.
``(e) Mandatory Reporting Requirements.--
``(1) Initial reporting requirements.--Not later than
January 31, 2004, the Administrator shall promulgate such
regulations as are necessary to implement the initial
mandatory reporting requirements under section 704(a)(1).
``(2) Final reporting requirements.--Not later than January
31, 2005, the Administrator shall promulgate such regulations
as

[[Page S10723]]

are necessary to implement the final mandatory reporting
requirements under section 704(a)(2).
``(f) Voluntary Reporting Provisions.--Not later than
January 31, 2004, the Administrator shall promulgate such
regulations and issue such guidance as are necessary to
implement the voluntary reporting provisions under section
704(b).
``(g) Adjustment Factors.--Not later than January 31, 2004,
the Administrator shall promulgate such regulations as are
necessary to implement the adjustment factors under section
704(c).''.
______

SA 1503. Mr. JEFFORDS submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 372, between lines 4 and 5, insert the following:

SEC. 97____. REPORT ON COSTS TO HUMAN HEALTH AND THE
ENVIRONMENT OF EXTRACTION, PRODUCTION,
CONSUMPTION, AND USE OF PRIMARY ENERGY
RESOURCES.

(a) Definitions.--In this section:
(1) Costs to human health and the environment.--The term
``costs to human health and the environment'' includes costs
of air pollution, global warming, water pollution, toxic
contamination, morbidity, and transgenerational effects.
(2) Primary energy resource.--The term ``primary energy
resource'' includes a fossil fuel, nuclear energy, a
renewable energy source, and electricity.
(b) Report.--Not later than 90 days after the date of
enactment of this Act, the Secretary of Energy, after
consultation with the Administrator of the Environmental
Protection Agency, shall enter into an agreement with the
National Academy of Sciences under which the Academy shall
complete and submit to Congress, not later than 2 years after
the date of enactment of this Act, a report that describes
and, to the maximum extent practicable, quantifies, the costs
to human health and the environment in the United States of
the extraction, production, consumption, and use of primary
energy resources that, as of the date of enactment of this
Act, are not reflected in retail prices paid by consumers for
the primary energy resources.
______

SA 1504. Mr. SCHUMER submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 327, between lines 14 and 15, insert the following:

SEC. 936. ASSISTANCE FOR ENERGY RESEARCH, ASSESSMENT, AND
DEVELOPMENT.

The Secretary of Energy shall provide $3,500,000 for fiscal
year 2004 and $5,000,000 for each of fiscal years 2005 and
2006, for use in carrying out research, assessment, and
development activities (including the procurement of
necessary research equipment) relating to--
(1) woody-lignocellulosic biomass;
(2) biotechnically produced and stored hydrogen; and
(3) bioproduct and sustainable industrial chemical research
and development.
______

SA 1505. Mr. SCHUMER submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of subtitle A of title VI, add the following:

SEC. 6____. MANHATTAN PROJECT FOR ENERGY INDEPENDENCE.

(a) Findings.--Congress finds that--
(1) the welfare and security of the United States require
that adequate provision be made for activities relating to
the development of energy-efficient technologies; and
(2) those activities should be the responsibility of, and
should be directed by, an independent establishment
exercising control over activities relating to the
development and promotion of energy-efficient technologies
sponsored by the United States.
(b) Purpose.--The purpose of this section is to establish
the Energy Efficiency Development Administration to develop
technologies to increase energy efficiency and to reduce the
demand for energy.
(c) Definitions.--In this section:
(1) Administration.--The term ``Administration'' means the
Energy Efficiency Development Administration established by
subsection (d)(1).
(2) Administrator.--The term ``Administrator'' means the
head of the Administration appointed under subsection
(d)(3)(A).
(3) Advisory committee.--The term ``Advisory Committee''
means the Policy Advisory Committee established by subsection
(f)(1)(A).
(4) Energy-efficient technology activity.--
(A) In general.--The term ``energy-efficient technology
activity'' means an activity that improves the energy
efficiency of any sector of the economy, including the
transportation, building design, electrical generation,
appliance, and power transmission sectors.
(B) Inclusion.--The term ``energy-efficient technology
activity'' includes an activity that produces energy from a
sustainable biomass, wind, small-scale hydroelectric, solar,
geothermal, or other renewable source.
(d) Energy Efficiency Development Administration.--
(1) Establishment.--There is established as an independent
establishment in the executive branch the Energy Efficiency
Development Administration.
(2) Mission.--The mission of the Administration shall be to
reduce United States imports of oil by--
(A) 5 percent by 2007;
(B) 20 percent by 2010; and
(C) 50 percent by 2014.
(3) Administrator; deputy administrator.--
(A) Administrator.--
(i) Appointment.--The Administration shall be headed by an
Administrator, who shall be appointed by the President, by
and with the advice and consent of the Senate.
(ii) Pay.--Section 5313 of title 5, United States Code, is
amended by adding at the end the following:
``Administrator, Energy Efficiency Development
Administration.''.
(iii) Duties.--The Administrator shall--

(I) exercise all powers and perform all duties of the
Administration; and
(II) have authority over all personnel and activities of
the Administration.

(iv) Limitation on rulemaking authority.--The Administrator
shall not modify any energy-efficiency standards or related
standards in effect on the date of enactment of this Act that
would result in the reduction of energy efficiency in any
product.
(B) Deputy administrator.--
(i) Appointment.--There shall be in the Administration a
Deputy Administrator, who shall be appointed by the
President, by and with the advice and consent of the Senate.
(ii) Pay.--Section 5314 of title 5, United States Code, is
amended by adding at the end the following:
``Deputy Administrator, Energy Efficiency Development
Administration.''.
(iii) Duties.--The Deputy Administrator shall--

(I) supervise the project development and engineering
activities of the Administration;
(II) exercise such other powers and perform such duties as
the Administrator may prescribe; and
(III) act for, and exercise the powers of, the
Administrator during the absence or disability of the
Administrator.

(4) Transfer of functions.--
(A) Definition of function.--In this paragraph, the term
``function'' means any duty, obligation, power, authority,
responsibility, right, privilege, activity, or program.
(B) Transfer of functions.--
(i) In general.--There are transferred to the
Administrator--

(I) all functions previously exercised by the Assistant
Secretary of Energy for Efficiency and Renewable Energy; and
(II) any authority to promulgate regulations relating to
fuel efficiency previously exercised by the Secretary of
Transportation.

(ii) Inclusions.--Functions transferred under clause (i)
include all real and personal property, personnel funds, and
records of the Office of Energy Efficiency and Renewable
Energy of the Department of Energy.
(iii) Determination of functions.--The Director of the
Office of Management and Budget shall determine the functions
that are transferred under clause (i).
(C) Presidential transfers.--
(i) In general.--The President, until the date that is 4
years after the date of enactment of this Act, may transfer
to the Administrator--

(I) any function of any other department or agency of the
United States, or of any officer or organizational entity of
any department or agency, that relates primarily to the
duties of the Administrator under this section; and
(II) any records, property, personnel, and funds that are
necessary to carry out that function.

(ii) Reports.--The President shall submit to Congress a
report that describes the nature and effect of any transfer
made under clause (i).
(D) Abolishment of office.--The Office of Energy Efficiency
and Renewable Energy of the Department of Energy is
abolished.
(5) Duties.--
(A) In general.--The Administrator shall--
(i) plan, direct, and conduct energy-efficient technology
activities; and
(ii) provide for the widest appropriate dissemination of
information concerning the activities of the Administration
and the results of those activities.
(B) Objectives.--The energy-efficient technology activities
of the United States carried out from the Administrator or
carried out with financial assistance by the Administrator
shall be conducted so as to contribute significantly to 1 or
more of the following objectives:
(i) Expansion of knowledge about energy-efficient
technologies and the use of those technologies.
(ii) Improvement of existing energy-efficient technologies
or development of new energy-efficient technologies.
(iii) Identification of mechanisms to introduce energy-
efficient technologies into the marketplace.
(iv) Conduct of studies of--

(I) the potential benefits gained, such as environmental
protection, increasing energy

[[Page S10724]]

independence, and reducing costs to consumers; and
(II) the problems involved in the development and use of
energy-efficient technologies.

(v) The most effective use of the scientific resources of
the United States, with close cooperation among all
interested agencies of the United States so as to avoid
duplication of effort, facilities, and equipment.
(e) Powers.--The Administrator shall--
(1) not later than 180 days after the date of enactment of
this Act, submit to Congress a personnel plan for the
Administration that--
(A) specifies the initial number and qualifications of
employees needed for the Administration;
(B) describes the functions and General Service
classification and pay rates of the initial employees; and
(C) specifies how the Administrator will adhere to or
deviate from the civil service system;
(2) appoint and fix the compensation of such officers and
employees as are necessary to carry out the functions of the
Administration;
(3) establish the entrance grade for scientific personnel
without previous service in the Federal Government at a level
up to 2 grades higher than the grade provided for such
personnel in the General Schedule (within the meaning of
section 5104 of title 5, United States Code) and fix the
compensation of the personnel accordingly, as the
Administrator considers necessary to recruit specially
qualified scientific, environmental, and industry-related
expertise;
(4) acquire, construct, improve, repair, operate, and
maintain such laboratories, research and testing sites and
facilities, and such other real and personal property or
interests in real and personal property, as the Administrator
determines to be necessary for the performance of the
functions of the Administration;
(5) enter into and perform such contracts, leases,
cooperative agreements, or other transactions as are
necessary in the performance of the duties of the
Administrator with any--
(A) agency or instrumentality of the United States;
(B) State, Territory, or possession;
(C) political subdivision of any State, Territory, or
possession; or
(D) person, firm, association, corporation, or educational
institution;
(6)(A) with the consent of Federal and other agencies, with
or without reimbursement, use the services, equipment,
personnel, and facilities of those agencies; and
(B) cooperate with other public and private agencies and
instrumentalities in the use of services, equipment,
personnel, and facilities; and
(7) establish within the Administration such offices and
procedures as the Administrator considers appropriate to
provide for the greatest possible coordination of the
activities of the Administration with related scientific and
other activities of other public and private agencies and
organizations.
(f) Organizational Structure.--
(1) Policy advisory committee.--
(A) Establishment.--There is established in the
Administration a Policy Advisory Committee.
(B) Membership.--
(i) Composition.--The Advisory Committee shall be composed
of 12 members, of whom--

(I) 4 members shall be representatives of the energy
efficiency and environmental protection community;
(II) 4 members shall be representatives of--

(aa) industries involved in the generation, transmission,
or distribution of energy products; or
(bb) the transportation industry; and

(III) 4 members shall be representatives of the scientific
and university research community.

(ii) Appointment.--The Speaker of the House of
Representatives, the majority leader of the Senate, the
minority leader of the House of Representatives, and the
minority leader of the Senate shall each appoint 1 member
described in subclauses (I), (II), and (III) of clause (i).
(C) Duties.--The Advisory Committee shall--
(i) act as a steering committee for the Administration; and
(ii) formulate a long-term strategy for--

(I) achieving the mission of the Administration under
subsection (d)(2); and
(II) identifying energy-efficient technologies and
initiatives that--

(aa) have the potential to increase energy efficiency over
the long term; and
(bb) should be further explored by the Administration.
(D) Staff.--The Advisory Committee may appoint not more
than 24 employees to assist in carrying out the duties of the
Advisory Committee, of whom--
(i) 8 shall report to the members appointed under
subparagraph (B)(i)(I);
(ii) 8 shall report to the members appointed under
subparagraph (B)(i)(II); and
(iii) 8 shall report to the members appointed under
subparagraph (B)(i)(III).
(E) FACA.--The Federal Advisory Committee Act (5 U.S.C.
App.) shall apply to the Advisory Committee.
(2) Office of administration.--
(A) Establishment.--There is established in the
Administration an Office of Administration.
(B) Assistant deputy administrator.--The head of the Office
of Administration shall be an Assistant Deputy Administrator
for Administration, to be appointed by the Administrator.
(C) Public information division.--
(i) Establishment.--There is established in the Office of
Administration a Public Information Division.
(ii) Duties.--The Public Information Division shall serve
as a liaison between the Administration, the public, and
other entities.
(D) Energy efficiency economics division.--
(i) Establishment.--There is established in the Office of
Administration an Energy Efficiency Economics Division.
(ii) Staff.--The Energy Efficiency Economics Division shall
be composed of economists and individuals with expertise in
energy markets, consumer behavior, and the economic impacts
of energy policy
(iii) Duties.--The Energy Efficiency Economics Division
shall study the effects of existing and proposed energy-
efficient technologies on the economy of the United States,
with an emphasis on assessing--

(I) the impacts of those technologies on consumers; and
(II) the contributions of those technologies on the
economic development of the United States.

(E) Incentives division.--
(i) Establishment.--There is established in the Office of
Administration an Incentives Division.
(ii) Duties.--The Incentives Division shall--

(I) conduct a study of economic incentives that would
assist the Administration in--

(aa) developing energy-efficient technologies; and
(bb) introducing those technologies into the marketplace;
and

(II) submit to Congress a report on the results of the
study conducted under subclause (I).

(F) Education division.--
(i) Establishment.--There is established in the Office of
Administration an Education Division.
(ii) Duties.--The Education Division shall provide--

(I) to the public, information concerning--

(aa) how to conserve energy, including--
(AA) what type of products are energy-efficient; and
(BB) where such products may be purchased; and
(bb) the importance of conserving energy; and

(II) provide to building owners, engineers, contractors,
and other businesspersons training in energy-efficient
technologies.

(G) Legislative counsel division.--There is established in
the Office of Administration a Legislative Counsel Division
to provide legal assistance to the Administrator.
(3) Office of policy, research, and development.--
(A) Establishment.--There is established in the
Administration an Office of Policy, Research, and Development
to establish the organizational structure of the
Administration relating to the project development and
engineering activities of the Administration.
(B) Assistant deputy administrator.--The head of the Office
of Policy, Research, and Development shall be an Assistant
Deputy Administrator for Policy, Research, and Development,
to be appointed by the Administrator.
(C) Powers.--In establishing the organizational structure
under subparagraph (A), the Office of Policy, Research, and
Development may--
(i) incorporate a flat organizational structure comprised
of project-based teams;
(ii) focus on accelerating the development of energy-
efficient technologies during the period from fundamental
research to implementation;
(iii) coordinate with the private sector; and
(iv) adopt organizational models used by other Federal
agencies conducting advanced research.
(4) Office of venture capital.--
(A) Establishment.--There is established in the
Administration an Office of Venture Capital.
(B) Assistant deputy administrator.--The head of the Office
of Venture Capital shall be an Assistant Deputy Administrator
for Venture Capital, to be appointed by the Administrator.
(C) Duties.--The Office of Venture Capital shall--
(i) accept applications from companies requesting financial
assistance for energy-efficient technology proposals;
(ii) accept recommendations and input from the Deputy
Administrator and the Policy Advisory Committee on
applications submitted under clause (i); and
(iii) from among the applications submitted under clause
(i), award financial assistance to applicants to carry out
the proposals that are most likely to improve energy
efficiency.
(g) Initial Technology Solicitations.--
(1) In general.--The Administrator may, based on the
criteria described in paragraph (2), initiate the development
of technologies for--
(A) fuel-efficient tires;
(B) construction of a hydrogen infrastructure;
(C) high-temperature superconducting cable;
(D) improved switches, resistors, capacitors, software and
smart meters for electrical transmission systems;
(E) combined heat and power;
(F) micro turbines;
(G) fuel cells;

[[Page S10725]]

(H) energy-efficient lighting;
(I) energy efficiency training for building contractors;
(J) retrofitting or rehabilitation of existing structures
to incorporate energy-efficient technologies; and
(K) efficient micro-channel heat exchangers.
(2) Criteria.--In determining which technologies to develop
under paragraph (1), the Administrator shall consider--
(A) the current status of development of the technology;
(B) the potential for widespread use of the technology in
commercial markets;
(C) the time and costs of efforts needed to bring the
technology to full implementation; and
(D) the potential of the technology to contribute to the
goals of the Administration.
(3) Report.--As soon as practicable after the date of
enactment of this Act, but not later than 1 year after the
date of enactment of this Act, the Administrator shall submit
to Congress a report that--
(A) assesses the potential for the technologies described
in paragraph (1) to contribute to the goals of the
Administration; and
(B) describes the plans of the Administration to develop
the technologies under paragraph (1).
(h) Reports.--
(1) By the administrator.--Semiannually and at such other
times as the Administrator considers appropriate, the
Administrator shall submit to the President a report that
describes the activities and accomplishments of the
Administration.
(2) By the president.--In January of each year, the
President shall submit to Congress a report that includes--
(A) a description of the activities and accomplishments of
all agencies of the United States in the field of energy
efficiency during the preceding calendar year;
(B) an evaluation of the activities and accomplishments of
the Administrator in attaining the objectives of this
section; and
(C) such recommendations for additional legislation as the
Administrator or the President considers appropriate for the
attainment of the objectives described in this section.
(i) Authorization of Appropriations.--There are authorized
to be appropriated to carry out this section--
(1) $5,000,000,000 for fiscal year 2004;
(2) $6,000,000,000 for fiscal year 2005;
(3) $7,500,000,000 for each of fiscal years 2006 and 2007;
(4) $9,000,000,000 for each of fiscal years 2008 and 2009;
and
(5) $10,000,000,000 for each of fiscal years 2010 through
2014.
______

SA 1506. Mr. SCHUMER submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of subtitle D of title IV, add the following:

SEC. 4____. PLAN FOR TRANSFER OF WESTERN NEW YORK SERVICE
CENTER.

Not later than the date that is 1 year after the date of
enactment of this Act, the Secretary of Energy shall, in
consultation with the President of the New York State Energy
Research and Development Authority, develop and submit to
Congress a plan for the transfer to the Secretary of Energy
of title to, and full responsibility for the possession,
transportation, disposal, stewardship, maintenance, and
monitoring of, all facilities, property, and radioactive
waste at the Western New York Service Center, West Valley,
New York.
______

SA 1507. Mr. SCHUMER submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 90, between lines 15 and 16, insert the following:

Subtitle D--Preservation of Availability of Natural Gas-Base
Liquefiable Hydrocarbon Supplies in Concert With Pipeline Operational
Safety and Environmental Protection

SEC. 151. NATURAL GAS LIQUIDS.

(a) Definitions.--In this section:
(1) Commission.--The term ``Commission'' means the Federal
Energy Regulatory Commission.
(2) Dependent industry.--
(A) In general.--The term ``dependent industry'' means an
industry that is dependent on receiving supplies of
liquefiable hydrocarbons transported in interstate commerce.
(B) Inclusions.--The term ``dependent industry'' includes--
(i) the petrochemical industry, with respect to ethane and
other natural gas-based feedstocks;
(ii) the propane-butane distribution industry, with respect
to propane and propane-butane mixes delivered to residential
and agricultural users for use in heating; and
(iii) the refining-blending industry, with respect to the
manufacture of gasoline and other motor fuels.
(3) Liquefiable hydrocarbon.--
(A) In general.--The term ``liquefiable hydrocarbon'' means
a hydrocarbon in natural gas that is capable of being
separated from the natural gas through--
(i) absorption;
(ii) condensation;
(iii) adsorption; or
(iv) any other method of separation used in a natural gas
processing or cycling facility.
(B) Inclusions.--The term ``liquefiable hydrocarbon''
includes--
(i) ethane;
(ii) propane;
(iii) butane; and
(iv) a heavier hydrocarbon that is commonly referred to as
a condensate, natural gasoline, or liquefied petroleum gas.
(b) Regulations.--
(1) In general.--Not later than 270 days after the date of
enactment of this Act, the Commission shall promulgate
regulations applicable to the transportation of natural gas
in interstate commerce that require the extraction from
natural gas streams of liquefiable hydrocarbons in quantities
that are sufficient--
(A) to protect against the formation of liquids in
downstream delivery systems for natural gas that interfere
with the safe and efficient operation of those delivery
systems; and
(B) to ensure the availability of historical levels of the
extracted liquefiable hydrocarbons to dependent industries.
(2) Requirements.--The regulations promulgated under this
subsection may be structured--
(A) to require the extraction of excess liquefiable
hydrocarbons from a natural gas stream before receipt of the
natural gas by an interstate transporter of natural gas; or
(B) to permit the extraction to occur at 1 or more
processing plants that are located--
(i) on the delivery system for the natural gas; and
(ii) downstream of the point of receipt of the natural gas
by the interstate transporter.
(3) Protection from economic loss.--To the maximum extent
practicable, the Commission shall, in accordance with
regulations promulgated under this subsection, provide for
the protection of a transporter of natural gas described in
paragraph (2) from any economic loss suffered by the
transporter as a result of the requirement that the natural
gas stream of the transporter be subject to the extraction of
excess liquefiable hydrocarbons described in paragraph (2).
______

SA 1508. Mr. SCHUMER submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 165, between lines 14 and 15, insert the following:

SEC. 5____. REINSTATEMENT AND TRANSFER OF THE FEDERAL LICENSE
FOR PROJECT NO. 2696.

(a) Definitions.--
(1) Commission.--The term ``Commission'' means the Federal
Energy Regulatory Commission.
(2) Town.--The term ``town'' means the town of Stuyvesant,
New York, the holder of Federal Energy Regulatory Commission
Preliminary Permit No. 11787.
(b) Reinstatement and Transfer.--Notwithstanding section 8
of the Federal Power Act (16 U.S.C. 801) or any other
provision of that Act, the Commission shall, not later than
30 days after the date of enactment of this Act--
(1) reinstate the license for Project No. 2696; and
(2) transfer the license to the town.
(c) Hydroelectric Incentives.--Project No. 2696 shall be
entitled to the full benefit of any Federal law that--
(1) promotes hydroelectric development; and
(2) that is enacted within 2 years before or after the date
of enactment of this Act.
(d) Co-Licensee.--Notwithstanding the issuance of a
preliminary permit to the town and any consideration of
municipal preference, the town may at any time add as a co-
licensee to the reinstated license a private or public
entity.
(e) Project Financing.--The town may receive loans under
sections 402 and 403 of the Public Utility Regulatory
Policies Act of 1978 (16 U.S.C. 2702, 2703) or similar
programs for the reimbursement of the costs of any
feasibility studies and project costs incurred during the
period beginning on January 1, 2001 and ending on December
31, 2006.
(f) Energy Credits.--Any power produced by the project
shall be deemed to be incremental hydropower for purposes of
qualifying for energy credits or similar benefits.
______

SA 1509. Mr. SCHUMER submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 434, strike lines 6 and 7 and insert the following:
not later than 1 year after the date of enactment of this
paragraph.
``(D) No preclusion of state activity.--Nothing in this
paragraph precludes a State from establishing incentives to
encourage onsite generation of electricity or net metering in
addition to the incentives established under this section as
of the date of enactment of this paragraph.
``(E) Reports.--
``(i) In general.--Not later than 1 year after the date of
enactment of this paragraph, the Secretary shall complete a
report

[[Page S10726]]

that assesses the impact that the establishment of a national
net metering and generating facility interconnection standard
would have on--

``(I) electric generating resource diversity;
``(II) air quality;
``(III) national energy security;
``(IV) transmission system congestion relief; and
``(V) customer alternatives for electricity supply.

``(ii) Annual reports on standards.--Not later than 1 year
after the date of enactment of this paragraph, and annually
thereafter, the Secretary shall submit to Congress a report
on State net metering and interconnection standards that--

``(I) compares the State standards with any national
standards;
``(II) assesses the compliance of individual utilities with
applicable standards; and
``(III) includes a list of preapproved systems and
equipment that would be subject to a national net metering
and generating facility interconnection standard described in
clause (i), taking into consideration State input and all
applicable standards of the Department of Energy.''.

______

SA 1510. Mr. SCHUMER submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 433, between liens 8 and 9, insert the following:

SEC. 1134. CONNECTION OF STATIONARY FUEL CELLS TO ELECTRICITY
GRIDS.

(a) In General.--As soon as practicable after the date of
enactment of this Act, the Secretary of Energy shall develop
and submit to Congress a plan and implementation schedule for
the connection of stationary fuel cells to electricity grids
throughout the United States.
(b) Quantity of Fuel Cells.--The plan and implementation
schedule shall provide for the connection in accordance with
subsection (a) of at least--
(1) 50,000 stationary fuel cells by January 1, 2010; and
(2) 1,000,000 stationary fuel cells by January 1, 2020.
______

SA 1511. Mr. SCHUMER submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 90, between lines 15 and 16, insert the following:

Subtitle D--Miscellaneous

SEC. 1____. STRATEGIC PETROLEUM RESERVE DRAWDOWN AUTHORITY

Section 161(d)(2) of the Energy Policy and Conservation Act
(42 U.S.C. 6241(d)(2)) is amended--
(1) by striking ``(A) an emergency'' and inserting ``(A)(i)
an emergency'';
(2) by striking ``(B) a severe'' and inserting ``(ii) a
severe'';
(3) by striking ``(C) such price'' and inserting ``(iii)
such price'';
(4) by striking ``economy.'' and inserting ``economy; or'';
and
(5) by adding at the end the following:
``(B) there exist severe economic conditions or volatility
in the price of petroleum or petroleum products that pose a
significant threat to economic stability that could be
mitigated by a drawdown and sale of petroleum products from
the Strategic Petroleum Reserve.''.
______

SA 1512. Mr. SCHUMER (for himself and Mrs. Clinton) submitted an
amendment intended to be proposed by him to the bill S. 14, to enhance
the energy security of the United States, and for other purposes; which
was ordered to lie on the table; as follows:

At the end of title I, add the following:

Subtitle D--Miscellaneous

SEC. ____. FINGER LAKES NATIONAL FOREST WITHDRAWAL.

All Federal land within the boundary of Finger Lakes
National Forest in the State of New York is withdrawn from--
(1) all forms of entry, appropriation, or disposal under
the public land laws; and
(2) disposition under all laws relating to oil and gas
leasing.
______

SA 1513. Mr. SCHUMER submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 466, after line 22, add the following:

Subtitle____--Miscellaneous

SEC. 11____. TRANSMISSION FACILITIES CROSSING STATE
BOUNDARIES.

(a) Purpose.--The purpose of this section is to provide for
the use of completed but unused or underused electric
transmission facilities that cross the boundary between 2
States if such use would, without additional construction or
significant adverse environmental impact, add electric
transfer capability for the benefit of areas that are subject
to risk of electricity shortages, outages, or curtailments
under reasonably anticipated conditions.
(b) Amendment.--Section 202 of the Federal Power Act (16
U.S.C. 824a) is amended by adding at the end the following:
``(h) Unused or Underused Transmission Facilities.--
``(1) In general.--Notwithstanding any other law, if, not
later than 90 days after the date on which a motion is made
by the Secretary of Energy or a State for the commercial
operation of completed but unused or underused interstate
electric transmission facilities, and not less than 30 days
after the date on which the Secretary of Energy provides to
affected State commissions and regional transmission
organizations written notice of the motion, the Secretary of
Energy makes the determinations required under paragraph (2),
the Secretary of Energy shall by order authorize, in
coordination with other regional transmission facilities,
such commercial operation.
``(2) Determinations.--The Secretary of Energy shall issue
an order under paragraph (1) if the Secretary of Energy
determines that--
``(A) the unused or underused electric transmission
facilities--
``(i) cross the boundary between 2 States; and
``(ii) are in existence on the date of enactment of this
subsection;
``(B) no incremental construction is required to make the
electric transmission facilities operational;
``(C) the operation of the electric transmission facilities
would be unlikely to cause significant adverse environmental
impacts;
``(D) affected States, State commissions, and other
interested persons have had a reasonable opportunity to raise
issues concerning--
``(i) the lack of benefits from the transmission capacity
or electric energy to be transmitted; or
``(ii) any potential adverse environmental impacts from
such transmission; and
``(E) any issues raised under paragraph (D) have been duly
considered and found to be--
``(i) without merit; or
``(ii) without negative weight sufficient to offset the
benefits of operating the electric transmission
facilities.''.
______

SA 1514. Mr. SCHUMER submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 150, between lines 14 and 15, insert the following:

SEC. 443. SENSE OF THE SENATE CONCERNING REGULATIONS
REGARDING THE EXPORT OF HIGHLY ENRICHED
URANIUM.

(a) Findings.--Congress finds that--
(1) the prevention of the proliferation of weapons-grade or
highly enriched uranium has taken on an enhanced level of
importance, given that evidence has been clearly and
repeatedly presented that terrorist groups and hostile
regimes have sought to acquire highly enriched uranium and
associated technologies for the purpose of developing nuclear
weapons;
(2) terrorist entities do not distinguish between uranium
exported for medical use versus other uses when seeking to
acquire material for nuclear weapons and radiological
dispersal devices;
(3) the terrorist attacks of September 11, 2001, clearly
demonstrated that terrorist organizations are capable of
carrying out attacks against the United States that are more
sophisticated, coordinated, and destructive than was
previously thought possible or likely;
(4) a successful terrorist attack against the United States
using a nuclear weapon or radiological dispersal device could
result in catastrophic loss of life, environmental damage,
and economic consequences;
(5) increasing exports, transmissions, and volumes of
highly enriched uranium will consequently increase the
possibility that such material will be lost, diverted,
stolen, or improperly sold;
(6) regulations in effect on the date of enactment of this
Act are designed to apply explicitly to materials used in
isotope production;
(7) the regulations were promulgated for the purpose of
encouraging research reactors and medical isotope producers
to switch from highly enriched uranium to low-enriched
uranium fuels and targets, thereby decreasing the risk of
weapons grade material being lost, diverted, stolen, or
improperly sold;
(8) under the regulations, operators of research reactors
and medical isotope manufacturers must commit to
transitioning from highly enriched uranium to low-enriched
uranium in order to continue receiving highly enriched
uranium fuel and targets from the United States;
(9) a repeal of the regulations would unnecessarily weaken
anti-proliferation efforts and reduce safeguards for highly
enriched uranium;
(10) the regulations place access to a reliable and
sufficient supply of medical isotopes in no jeopardy;
(11) no foreign isotope producer has been denied a request
for exports of highly enriched uranium so long as a producer
has agreed to continue cooperating with the requirement to
eventually shift to low-enriched uranium;
(12) the regulations have been successful in enticing 3 of
Europe's 4 main highly enriched

[[Page S10727]]

uranium fueled reactors to pledge that the reactors will be
converted to low-enriched uranium, influencing the
construction of a new, large low-enriched uranium reactor in
France, and influencing facilities in Australia, Indonesia,
and Argentina to convert to low-enriched uranium;
(13) without the regulations, foreign isotope producers
would likely abandon efforts to convert to low-enriched
uranium, thereby increasing the risks associated with
proliferation and nuclear terrorism;
(14) in Australia, low-enriched uranium is already used in
the production of isotopes, clearly demonstrating that there
is no technological barrier to effective low-enriched uranium
use; and
(15) there has been growing concern regarding the ability
to safeguard highly enriched uranium supplies at medical
isotope production facilities and research reactors in more
than 50 countries worldwide.
(b) Sense of the Senate.--It is the sense of the Senate
that--
(1) there is no compelling need to repeal highly enriched
uranium export regulations in effect on the date of enactment
of this Act;
(2) efforts to repeal the regulations needlessly create an
additional threat to the national security of the United
States; and
(3) Congress should take no steps to repeal the
regulations.
______

SA 1515. Mr. SCHUMER submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of subtitle B of title VII, add the following:

SEC. 7____. MOTOR VEHICLE TIRES SUPPORTING MAXIMUM FUEL
EFFICIENCY.

(a) Standards for Tires Manufactured for Interstate
Commerce.--Section 30123 of title 49, United States Code, is
amended--
(1) in subsection (b), by inserting after the first
sentence the following: ``The grading system shall include
standards for rating the fuel efficiency of tires designed
for use on passenger cars and light trucks.''; and
(2) by adding at the end the following:
``(d) National Tire Fuel Efficiency Program.--(1) The
Secretary shall develop and carry out a national tire fuel
efficiency program for tires designed for use on passenger
cars and light trucks.
``(2) The program shall include the following:
``(A) Policies and procedures for testing and labeling
tires for fuel economy to enable tire buyers to make informed
purchasing decisions about the fuel economy of tires.
``(B) Policies and procedures to promote the purchase of
energy-efficient replacement tires, including purchase
incentives, website listings on the Internet, printed fuel
economy guide booklets, and mandatory requirements for tire
retailers to provide tire buyers with fuel-efficiency
information on tires.
``(C) Minimum fuel economy standards for tires, promulgated
by the Secretary.
``(3) The minimum fuel economy standards for tires shall--
``(A) ensure that the fuel economy of replacement tires is
equal to or better than the average fuel economy of tires
sold as original equipment;
``(B) secure the maximum technically feasible and cost-
effective fuel savings;
``(C) not adversely affect tire safety;
``(D) not adversely affect the average tire life of
replacement tires;
``(E) incorporate the results from--
``(i) laboratory testing; and
``(ii) to the extent appropriate and available, on-road
fleet testing programs conducted by the manufacturers; and
``(F) not adversely affect efforts to manage scrap tires.
``(4) The policies, procedures, and standards developed
under paragraph (2) shall apply to all types and models of
tires that are covered by the uniform tire quality grading
standards under section 575.104 of title 49, Code of Federal
Regulations (or any successor regulation).
``(5) Not less often than every three years, the Secretary
shall review the minimum fuel economy standards in effect for
tires under this subsection and revise the standards as
necessary to ensure compliance with requirements under
paragraph (3). The Secretary may not, however, reduce the
average fuel economy standards applicable to replacement
tires.
``(6) Nothing in this chapter shall be construed to preempt
any provision of State law relating to higher fuel economy
standards applicable to replacement tires designed for use on
passenger cars and light trucks.
``(7) Nothing in this chapter shall apply to--
``(A) a tire or group of tires with the same SKU, plant,
and year, for which the volume of tires produced or imported
is less than 15,000 annually;
``(B) a deep tread, winter-type snow tire, space-saver
tire, or temporary use spare tire;
``(C) a tire with a normal rim diameter of 12 inches or
less;
``(D) a motorcycle tire; or
``(E) a tire manufactured specifically for use in an off-
road motorized recreational vehicle.
``(8) In this subsection, the term `fuel economy', with
respect to tires, means the extent to which the tires
contribute to the fuel economy of the motor vehicles on which
the tires are mounted.
(b) Conforming Amendment.--Section 30103(b) of title 49,
United States Code, is amended in paragraph (1) by striking
``When'' and inserting ``Except as provided in section
30123(d) of this title, when''.
(c) Time for Implementation.--The Secretary of
Transportation shall ensure that the national tire fuel
efficiency program required under subsection (d) of section
30123 of title 49, United States Code (as added by subsection
(a)(2)), is administered so as to apply the policies,
procedures, and standards developed under paragraph (2) of
such subsection (d) beginning not later than March 31, 2006.
______

SA 1516. Mr. BINGAMAN submitted an amendment intended to be proposed
to amendment SA 1432 proposed by Mr. Frist to the bill S. 14, to
enhance the energy security of the United States, and for other
purposes; which was ordered to lie on the table; as follows:

At the appropriate place in the amendment, strike section
715 and insert the following:

SEC. 715. REDUCTION OF ENGINE IDLING OF HEAVY-DUTY VEHICLES.

(a) Definitions.--In this section:
(1) Administrator.--The term ``Administrator'' means the
Administrator of the Environmental Protection Agency.
(2) Advanced truck stop electrification system.--The term
``advanced truck stop electrification system'' means a
stationary and independent electrification system that
delivers heat, air conditioning, electricity, communications,
and other convenient services, and is capable of providing
verifiable and auditable evidence of use of those services,
to a heavy-duty vehicle and any occupants of the heavy-duty
vehicle without relying on components mounted onboard the
heavy-duty vehicle for delivery of those services.
(3) Auxiliary power unit.--The term ``auxiliary power
unit'' means an integrated system that--
(A) provides heat, air conditioning, engine warming, and
electricity to the factory-installed components on a heavy-
duty vehicle as if the main drive engine of the heavy-duty
vehicle were running; and
(B) is certified by the Administrator of the Environmental
Protection Agency under part 89 of title 40, Code of Federal
Regulations (or successor regulations), as meeting applicable
emission standards.
(4) Heavy-duty vehicle.--The term ``heavy-duty vehicle''
means a vehicle that--
(A) has a gross vehicle weight rating greater than 12,500
pounds; and
(B) is powered by a diesel engine.
(5) Idle reduction technology.--The term ``idle reduction
technology'' means an advanced truck stop electrification
system, auxiliary power unit, or another device or system of
devices that--
(A) is used to reduce long-duration idling of a heavy-duty
vehicle; and
(B) allows for the main drive engine or auxiliary
refrigeration engine of a heavy-duty vehicle to be shut down.
(6) Long-duration idling.--
(A) In general.--The term ``long-duration idling'' means
the operation of a main drive engine or auxiliary
refrigeration engine of a heavy-duty vehicle, for a period
greater than 15 consecutive minutes, at a time at which the
main drive engine is not engaged in gear.
(B) Exclusions.--The term ``long-duration idling'' does not
include the operation of a main drive engine or auxiliary
refrigeration engine of a heavy-duty vehicle during a routine
stoppage associated with traffic movement or congestion.
(b) Idle Reduction Technology Benefits, Programs, and
Studies.--
(1) In general.--Not later than 90 days after the date of
enactment of this Act, the Administrator shall--
(A)(i) commence a review of the mobile source air emission
models of the Environmental Protection Agency used under the
Clean Air Act (42 U.S.C. 7401 et seq.) to determine whether
the models accurately reflect the emissions resulting from
long-duration idling of heavy-duty vehicles and other
vehicles and engines; and
(ii) update those models as the Administrator determines to
be appropriate; and
(B)(i) commence a review of the emission reductions
achieved by the use of idle reduction technology; and
(ii) complete such revisions of the regulations and
guidance of the Environmental Protection Agency as the
Administrator determines to be appropriate.
(2) Deadline for completion.--Not later than 180 days after
the date of enactment of this Act, the Administrator shall--
(A) complete the reviews under subparagraphs (A)(i) and
(B)(i) of paragraph (1); and
(B) prepare and make publicly available 1 or more reports
on the results of the reviews.
(3) Discretionary inclusions.--The reviews under
subparagraphs (A)(i) and (B)(i) of paragraph (1) and the
reports under paragraph (2)(B) may address the potential fuel
savings resulting from use of idle reduction technology.
(4) Idle reduction deployment program.--
(A) In general.--Not later than 90 days after the date of
the enactment of this Act, the Administrator, in consultation
with the Secretary of Transportation, shall establish a
program to support deployment of idle reduction technology
that benefits strategic locations based on air quality and
congestion considerations.

[[Page S10728]]

(B) Authorization of appropriations.--There are authorized
to be appropriated to the Administrator such sums as are
necessary to carry out subparagraph (A).
(5) Idling location study.--
(A) In general.--Not later than 90 days after the date of
the enactment of this Act, the Secretary of Transportation,
in consultation with the Administrator, shall commence a
study to analyze all locations at which heavy-duty vehicles
stop for long duration idling, including--
(i) truck stops;
(ii) rest areas;
(iii) border crossings;
(iv) ports;
(v) transfer facilities; and
(vi) private terminals.
(B) Deadline for completion.--Not later than 180 days after
the date of enactment of this Act, the Secretary shall--
(i) complete the study under subparagraph (A); and
(ii) prepare and make publicly available 1 or more reports
of the results of the study.
(c) Vehicle Weight Exemption.--Section 127(a) of title 23,
United States Code, is amended--
(1) by designating the first through eleventh sentences as
paragraphs (1) through (11), respectively; and
(2) by adding at the end the following:
``(12) Heavy-duty vehicles.--
``(A) In general.--Subject to subparagraphs (B) and (C), in
order to promote reduction of fuel use and emissions due to
engine idling, the maximum gross vehicle weight limit and the
axle weight limit for any heavy-duty vehicle equipped with an
idle reduction technology shall be increased by a quantity
necessary to compensate for the additional weight of the idle
reduction system.
``(B) Maximum weight increase.--The weight increase under
subparagraph (A) shall be not greater than 250 pounds.
``(C) Proof.--On request by a regulatory or law enforcement
agency, the vehicle operator shall provide proof (through
demonstration or certification) that--
``(i) the idle reduction technology is fully functional at
all times; and
``(ii) the 250-pound gross weight increase is not used for
any purpose other than the use of idle reduction technology
described in subparagraph (A).''
______

SA 1517. Mrs. CLINTON submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:
On page 150, between lines 14 and 15, insert the following:

SEC. 4____. COVERAGE UNDER ENERGY EMPLOYEES OCCUPATIONAL
ILLNESS COMPENSATION PROGRAM OF INDIVIDUALS
EMPLOYED AT ATOMIC WEAPONS EMPLOYER FACILITY OR
BERYLLIUM VENDOR FACILITY DURING PERIOD OF
RESIDUAL CONTAMINATION.

(a) Atomic Weapons Employees.--Paragraph (3) of section
3621 of the Energy Employees Occupational Illness
Compensation Program Act of 2000 (42 U.S.C. 7384l) is amended
to read as follows:
``(3) The term `atomic weapons employee' means an
individual employed at an atomic weapons employer facility
during a period when--
``(A) the employer was processing or producing, for the use
by the United States, material that emitted radiation and was
used in the production of an atomic weapon, excluding uranium
mining and milling; or
``(B) as specified by the National Institute for
Occupational Safety and Health in the final report required
by section 3151(b)(2)(A)(ii) of the National Defense
Authorization Act for Fiscal Year 2002 (42 U.S.C. 7384 note)
or any supplement thereto or subsequent report, significant
contamination (as that term is defined in section
3151(b)(4)(B) of that Act) resulting from activities
described in subparagraph (A) remained after such facility
discontinued such activities.''.
(b) Beryllium Employees.--Paragraph (7) of that section is
amended by adding at the end the following new subparagraph:
``(D) A current or former employee at a facility of a
beryllium vendor, or of a contractor or subcontractor of a
beryllium vendor, during a period when, as specified by the
National Institute for Occupational Safety and Health in the
final report required by section 3151(b)(2)(A)(ii) of the
National Defense Authorization Act for Fiscal Year 2002 (42
U.S.C. 7384 note) or any supplement thereto or subsequent
report, significant contamination (as that term is defined in
section 3151(b)(4)(B) of that Act) of beryllium resulting
from activities described in subparagraph (C) remained after
such facility discontinued such activities.''.
(c) Supplemental Reports.--(1) Not later than June 30 of
each of 2004, 2005, and 2006, the National Institute for
Occupational Safety and Health shall submit to the applicable
congressional committees a supplement to the final report
required by subsection (b)(2)(A)(ii) of section 3151 of the
National Defense Authorization Act for Fiscal Year 2002 (42
U.S.C. 7384 note).
(2) Each supplement under paragraph (1) shall--
(A) for each atomic weapons facility or facility of a
beryllium vendor, or of a contractor or subcontractor of a
beryllium vendor, for which more evaluation is required as of
the date of such final report to determine the extent of
residual contamination at such facility, include the results
of any completed study of whether there is significant
residual contamination at such facility;
(B) for each atomic weapons facility or facility of a
beryllium vendor, or of a contractor or subcontractor of a
beryllium vendor, at which residual contamination remained as
of June 30, 2003, according to such final report, identify
the date as of which such residual contamination was or will
be removed from such facility; and
(C) for each atomic weapons facility or facility of a
beryllium vendor, or of a contractor or subcontractor of a
beryllium vendor, for which new information on residual
contamination has been made available to the Institute after
the submittal of such final report, identify any revisions to
the evaluation of residual contamination at such facility set
forth in such final report that are warranted in light of
such information.
(3) Each supplement under paragraph (1) shall also be made
available to the public in paper and electronic form.
(4) In this subsection, the term ``applicable congressional
committees'' has the meaning given that term in subsection
(b)(2)(B) of section 3151 of the National Defense
Authorization Act for Fiscal Year 2002.
______

SA 1518. Mrs. DASCHLE submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:
At the end, add the following:

TITLE ____--MISCELLANEOUS

SEC. ____. RESEARCH, EXTENSION, AND EDUCATIONAL PROGRAMS ON
BIOBASED ENERGY TECHNOLOGIES AND PRODUCTS.

(a) In General.--The Biomass Research and Development Act
of 2000 (7 U.S.C. 7624 note; Public Law 106-224) is amended--
(1) by redesignating sections 310 and 311 as sections 311
and 312, respectively; and
(2) by inserting after section 309 the following:

``SEC. 310. RESEARCH, EXTENSION, AND EDUCATIONAL PROGRAMS ON
BIOBASED ENERGY TECHNOLOGIES AND PRODUCTS.

``(a) Purposes.--The purposes of the programs established
under this section are--
``(1) to enhance national energy security through the
development, distribution, and implementation of biobased
energy technologies;
``(2) to promote diversification in, and the environmental
sustainability of, agricultural production in the United
States through biobased energy and product technologies; and
``(3) to promote economic diversification in rural areas of
the United States through biobased energy and product
technologies.
``(b) Definitions.--In this section:
``(1) Land-grant colleges and universities.--The term
`land-grant colleges and universities' means--
``(A) 1862 Institutions (as defined in section 2 of the
Agricultural Research, Extension, and Education Reform Act of
1998 (7 U.S.C. 7601));
``(B) 1890 Institutions (as defined in section 2 of that
Act); and
``(C) 1994 Institutions (as defined in section 2 of that
Act).
``(2) Secretary.--The term `Secretary' means the Secretary
of Energy.
``(c) Establishment.--To carry out the purposes described
in subsection (a), the Secretary shall establish programs
under which--
``(1) the Secretary shall provide grants to sun grant
centers specified in subsection (d)(1); and
``(2) the sun grant centers shall use the grants in
accordance with this section.
``(d) Grants to Centers.--
``(1) In general.--The Secretary shall use amounts made
available for a fiscal year under subsection (i) to provide a
grant to each of the following sun grant centers:
``(A) North-central center.--A north-central sun grant
center at South Dakota State University for the region
composed of the States of Illinois, Indiana, Iowa, Minnesota,
Montana, Nebraska, North Dakota, South Dakota, Wisconsin, and
Wyoming.
``(B) Southeastern center.--A southeastern sun grant center
at the University of Tennessee at Knoxville for the region
composed of--
``(i) the States of Alabama, Florida, Georgia, Kentucky,
Mississippi, North Carolina, South Carolina, Tennessee, and
Virginia;
``(ii) the Commonwealth of Puerto Rico; and
``(iii) the United States Virgin Islands.
``(C) South-central center.--A south-central sun grant
center at Oklahoma State University for the region composed
of the States of Arkansas, Colorado, Kansas, Louisiana,
Missouri, New Mexico, Oklahoma, and Texas.
``(D) Western center.--A western sun grant center at Oregon
State University for the region composed of--
``(i) the States of Alaska, Arizona, California, Hawaii,
Idaho, Nevada, Oregon, Utah, and Washington; and

[[Page S10729]]

``(ii) territories and possessions of the United States
(other than the territories referred to in clauses (ii) and
(iii) of subparagraph (B)).
``(E) Northeastern center.--A northeastern sun grant center
at Cornell University for the region composed of the States
of Connecticut, Delaware, Massachusetts, Maryland, Maine,
Michigan, New Hampshire, New Jersey, New York, Ohio,
Pennsylvania, Rhode Island, Vermont, and West Virginia.
``(2) Equal amounts.--Of the amount of funds that are made
available for grants for a fiscal year under paragraph (1),
the Secretary shall provide an equal amount of grants to each
of the sun grant centers specified in paragraph (1).
``(e) Use of Funds.--
``(1) Centers of excellence.--Of the amount of funds that
are made available for a fiscal year to a sun grant center
under subsection (d), the center shall use not more than 25
percent of the amount for administration and support centers
of excellence in science, engineering, and economics at the
university to promote the purposes described in subsection
(a) through the State agricultural experiment station,
cooperative extension services, and relevant educational
programs of the university.
``(2) Grants to land-grant colleges and universities.--
``(A) In general.--The sun grant center established for a
region shall use the funds that remain available for a fiscal
year after expenditures made under paragraph (1) to provide
competitive grants to land-grant colleges and universities in
the region of the sun grant center to conduct, consistent
with the purposes described in subsection (a),
multiinstitutional and multistate--
``(i) research, extension, and educational programs on
technology development; and
``(ii) integrated research, extension, and educational
programs on technology implementation.
``(B) Programs.--Of the amount of funds that are used to
provide grants for a fiscal year under subparagraph (A), the
center shall use--
``(i) not less than 20 percent of the funds to carry out
programs described in subparagraph (A)(i); and
``(ii) not less than 20 percent of the funds to carry out
programs described in subparagraph (A)(ii).
``(3) Indirect costs.--
``(A) In general.--Except as provided in subparagraph (B),
a sun grant center may recover the indirect costs of making
grants under this subsection.
``(B) Other land-grant colleges and universities.--A sun
grant center may not recover the indirect costs of making
grants under paragraph (2) to other land-grant colleges and
universities.
``(f) Plan.--Subject to the availability of funds under
subsection (i), in cooperation with other land-grant colleges
and universities and private industry, the sun grant centers
shall jointly develop and submit to the Secretary, for
approval, a plan for addressing the biomass research
priorities of the office of energy efficiency a renewable
energy and for the making of grants under paragraphs (1) and
(2) of subsection (e) for programs that will facilitate the
development of--
``(1) not later than January 1, 2005, critical biobased-
based products industries;
``(2) not later than January 1, 2006--
``(A) a biobased transportation fuels production industry;
and
``(B) an independent biobased power production industry;
and
``(3) not later than January 1, 2007, biobased hydrogen
production systems.
``(g) Grants to Other Land-Grant Colleges and
Universities.--
``(1) Priority for grants.--In making grants under
subsection (e)(2), a sun grant center shall give a higher
priority to programs that are consistent with the plan
approved by the Secretary under subsection (f).
``(2) Term of grants.--The term of a grant provided by a
sun grant center under subsection (e)(2) shall not exceed 5
years.
``(3) Coordination with bioenergy and biobased product
development programs.--The sun grant centers shall jointly
develop and submit to the Secretary, for approval, a plan for
coordination of activities of the centers with, and input
from--
``(A) the bioenergy and biobased product development
programs of the Secretary of Energy, including those
conducted at the Oak Ridge National Laboratory and the
National Renewable Energy Laboratory; and
``(B) the biobased research and development programs of the
Secretary of Agriculture.
``(h) Grant Information Analysis Center.--The sun grant
centers shall maintain a Sun Grant Information Analysis
Center to provide sun grant centers analysis and data
management support.
``(i) Annual Reports.--Not later than March 1 following the
end of each fiscal year for which a sun grant center receives
a grant under subsection (d), the sun grant center shall
submit to the Secretary a report that describes the policies,
priorities, and operations of the program carried out by the
center during the fiscal year, including a description of
progress made in facilitating the priorities described in
subsection (f).
``(j) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $100,000,000 for
each of fiscal years 2004 through 2010, of which $4,000,000
for each fiscal year shall be made available to carry out
subsection (h).''.
(b) Conforming Amendment.--Subsections (a) and (b) of
section 311 of the Biomass Research and Development Act of
2000 (7 U.S.C. 7624 note; Public Law 106-224) (as
redesignated by subsection (a)(1)) are amended by inserting
``(other than section 310)'' after ``this title''.

SEC. ____. BIOMASS RESEARCH AND DEVELOPMENT.

(a) Board.--Section 305(b) of the Biomass Research and
Development Act of 2000 (7 U.S.C. 7624 note; Public Law 106-
224) is amended--
(1) by redesignating paragraphs (3) and (4) as paragraphs
(4) and (5), respectively;
(2) by inserting after paragraph (2) the following:
``(3) a representative of the Cooperative Research,
Extension, and Educational Service;''; and
(3) in paragraph (5) (as redesignated by paragraph (1)), by
striking ``(3)'' and inserting ``(4)''.
(b) Technical Advisory Committee.--Section 306(b)(1) of the
Biomass Research and Development Act of 2000 (7 U.S.C. 7624
note; Public Law 106-224) is amended--
(1) in subparagraph (I), by striking ``and'' at the end;
(2) by redesignating subparagraph (J) as subparagraph (K);
and
(3) by inserting after subparagraph (I) the following:
``(J) a representative of sun grant centers specified in
section 310(d)(1); and''.
______

SA 1519. Mr. JEFFORDS submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 69 strike line 6 and all that follows through line
7, page 70.
______

SA 1520. Mr. JEFFORDS submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 73, strike line 8 and all that follows through line
7, page 77.
______

SA 1521. Mr. JEFFORDS submitted an amendment intended to be proposed
to amendment SA 864 proposed by Mr. Campbell to the bill S. 14, to
enhance the energy security of the United States, and for other
purposes; which was ordered to lie on the table; as follows:

On page 17, strike line 11 and all that follows through
line 17 and insert:
``(f) Effect on Existing Law.--
``(1) Nothing in this section shall relieve the Secretary
of any obligation to conduct environmental or other reviews
or take any other actions required of the Secretary as of the
date of enactment of this section for activities on tribal
lands pursuant to the National Environmental Policy Act of
1969 (42 U.S.C. 2901 et seq.); the Clean Air Act (42 U.S.C.
7401 et seq.); the Federal Water Pollution Control Act (33
U.S.C. 1251 et seq.); the Solid Waste Disposal Act (42 U.S.C.
6901 et seq.); the Endangered Species Act (16 U.S.C. 1531 et
seq.); the National Historic Preservation Act (16 U.S.C. 470
et seq.); or any other Federal law for the protection of the
environment or environmental quality.
``(2) Nothing in this section affects the application of--
``(A) the Surface Mining Control and Reclamation Act of
1977 (30 U.S.C. 1201 et seq.);
``(B) the Atomic Energy Act of 1954 (42 U.S.C. 2011) or any
Federal law respecting nuclear or radioactive waste or mining
of radioactive materials; or
``(C) except as otherwise provided in this title, the
Indian Mineral Development Act of 1982 (25 U.S.C. 2101 et
seq.).''
______

SA 1522. Mr. JEFFORDS submitted an amendment intended to be proposed
to amendment SA 1412 proposed by Mr. Domenici (for himself, Ms.
Landrieu, Mr. Thomas, Ms. Murkowski, Mr. Campbell, Mr. Smith, Mr.
Alexander, Mr. Kyl, Mr. Nelson of Nebraska, Mr. Hagel, Mr. Talent, Mr.
Bunning, and Mr. Coleman) to the bill S. 14, to enhance the energy
security of the United States, and for other purposes; which was
ordered to lie on the table; as follows:

At the appropriate place, add the following:

SEC.    . ENERGY EFFICIENCY PERFORMANCE STANDARD.

Title VI of the Public Utility Regulatory Policies Act of
1978 (16 U.S.C. 2601 et seq.) is amended by adding at the end
the following:

``SEC. 607. FEDERAL ENERGY EFFICIENCY PERFORMANCE STANDARD.

``(a) Each electric retail supplier shall implement energy
efficiency and load reduction programs and measures to
achieve verified improvements in energy efficiency and peak
load reduction in retail customer facilities and the
distribution systems that serve them.
``(b) Such programs shall produce savings in total peak
power demand and total electricity use by retail customers by
an amount that is equal to or greater than the following

[[Page S10730]]

percentages relative to the peak demand and electricity used
in that year by the retail electric supplier's customers:

[Amounts in percent]
------------------------------------------------------------------------
Reduction    Reductions
in demand      in use
(kW)        (kWh)
------------------------------------------------------------------------
In calendar year 2004.........................            1          .75
In calendar year 2005.........................            2          1.5
In calendar year 2007.........................            4          3.0
In calendar year 2009.........................            6          4.5
In calendar year 2011.........................            8          6.9
In calendar year 2013.........................           10          7.5
------------------------------------------------------------------------

``(c) For purposes of this section, savings shall be
counted only for measures installed after January 1, 2003.
``(d) The Secretary of Energy is directed to establish, by
rule, procedures and standards for counting and independently
verifying energy and demand savings calculations for purposes
of enforcing the energy efficiency performance standards
imposed by this section. Such rule shall also include
procedures and a schedule of reporting findings to the
Department of Energy and for making such reports available to
the public. The Secretary shall consult with the association
representing the nation's public utility regulators, and with
the association representing the nation's state energy
officials in developing these procedures and standards. This
rulemaking shall be completed no later than June 30, 2004.
``(e) By June 30, 2006, and every two years thereafter,
each retail electric supplier shall file with the state
public utilities commission in each state in which it
supplies service to retail customers, a report demonstrating
that it has taken action to comply with the energy efficiency
performance standards of this section. These reports shall
include independent verification of the estimated savings
pursuant to standards established by the Secretary. A state
public utilities commission may accept such report as filed,
or may review and investigate the accuracy of the report.
Each state public utilities commission shall make findings on
any deficiencies relative to the requirements in section 2,
and shall create a remedial order for the correction of any
deficiencies that are found.
``(f) Electric retail suppliers not subject to the
jurisdiction of state public utilities commissions shall
report to their governing bodies. Such reports shall include
independent verification of the estimated savings pursuant to
standards established by the Secretary.
``(g) Electric retail suppliers may demonstrate
satisfaction of this standard, in whole or part, by savings
achieved through participation in statewide, regional, or
national programs that can be demonstrated to significantly
improve the efficiency of electric distribution and use.
Verified efficiency savings resulting from such programs may
be assigned to each participating retail supplier based upon
their degree of participation in such programs. Electric
retail suppliers may also purchase rights to extra savings
achieved by other electric retail suppliers, provided that
the selling supplier does not also take credit for those
savings.
``(h) In the event that any retail electric supplier fails
to achieve its energy savings and/or load reduction target
for a specific year, any aggrieved party may enter suit and
seek prompt remedial action before the state public utilities
commission or the appropriate governing body in the case of
electric retail suppliers not subject to state public utility
commission jurisdiction. The state public utilities
commission or other appropriate governing body shall have a
maximum of one year to craft a remedy. However, if a public
utilities commission or other governing body certifies that
it has inadequate resources or authority to promptly resolve
enforcement actions under this section, or fails to take
action within the time period specified above, enforcement
may be sought in Federal district court. If a commission or
court determines that energy savings and/or load reduction
targets for a specific year have not been achieved, the
commission or court shall determine the amount of the deficit
and shall fashion an equitable remedy to restore the lost
savings as soon as practicable. Such remedies may include a
refund to retail electric customers of an amount equal to the
average retail rate multiplied by the deficit in kW and/or
kWh, and the appointment of a special master to administer a
bidding system to procure the energy and demand savings equal
to 125% of the deficit.
______

SA 1523. Mr. JEFFORDS submitted an amendment intended to be proposed
to amendment SA 1412 proposed by Mr. Domenici (for himself, Ms.
Landreiu, Mr. Thomas, Ms. Murkowski, Mr. Campbell, Mr. Smith, Mr.
Alexander, Mr. Kyl, Mr. Nelson of Nebraska, Mr. Hagel, Mr. Talent, Mr.
Bunning, and Mr. Coleman) to the bill S. 14 to enhance the energy
security of the United States, and for other purposes; which was
ordered to lie on the table; as follows:

On page 45, after line 7, insert the following:

Subtitle I--System Benefits

SEC. 1192. SYSTEM BENEFITS FUND.

(a) Definitions.--For purposes of this section:
(1) Administrator.--The term ``Administrator'' means the
Administrator of the Environmental Protection Agency.
(2) Board.--The term ``Board'' means the Board established
under this section.
(3) Commission.--The term ``Commission'' means the Federal
Energy Regulatory Commission.
(4) Fund.--The term ``Fund'' means the System Benefits
Trust Fund established by this section.
(5) Renewable energy.--The term ``renewable energy'' means
electricity generated from wind, organic waste (excluding
incinerated municipal solid waste), or biomass (including
anaerobic digestion from farm systems and landfill gas
recovery) or a geothermal, solar thermal, or photovoltaic
source. For purposes of this paragraph, a farm system is an
electric generating facility that generates electric energy
from the anaerobic digestion of agricultural waste produced
by farming that is located on the farm where substantially
all of the waste used is produced.
(6) Secretary.--The term ``Secretary'' means the Secretary
of Energy.
(b) Board.--
(1) Establishment.--The Secretary shall establish a System
Benefits Trust Fund Board to carry out the functions and
responsibilities described in this section.
(2) Membership.--The Board shall be composed of--
(A) 1 representative of the Federal Energy Regulatory
Commission appointed by the Federal Energy Regulatory
Commission;
(B) 2 representatives of the Secretary of Energy appointed
by the Secretary of Energy;
(C) 2 persons nominated by the National Association of
Regulatory Utility Commissions and appointed by the
Secretary;
(D) 1 person nominated by the National Association of State
Utility Consumer Advocates and appointed by the Secretary;
(E) 1 person nominated by the National Association of State
Energy Officials and appointed by the Secretary;
(F) 1 person nominated by the National Energy Assistance
Directors' Association and appointed by the Secretary; and
(G) 1 representative of the Environmental Protection Agency
appointed by the Administrator.
(3) Chairperson.--The Secretary shall select a member of
the Board to serve as Chairperson of the Board.
(c) Establishment of Fund.--
(1) In general.--The Board shall establish an account or
accounts at one or more financial institutions, which account
or accounts shall be known as the System Benefits Trust Fund
consisting of amounts deposited in the fund under subsection
(d).
(2) Status of fund.--The wires charges collected under
subsection (e) and deposited in the Fund--
(A) shall not constitute funds of the United States.
(B) shall be held in trust by the Board solely for the
purposes stated in subsection (d); and
(C) shall not be available to meet any obligations of the
United States.
(d) Use of Fund.--
(1) Funding of state programs.--Amounts in the Fund shall
be used by the Board to provide matching funds to States and
Indian tribes for the support of State or tribal public
benefits programs relating to--
(A) energy conservation and efficiency;
(b) renewable energy sources;
(C) assisting low-income households in meeting their home
energy needs; or
(D) research and development in areas de-scribed in
subparagraphs (A) through (C).
(2) Distribution.--
(A) In general.--Except for amounts needed to pay costs of
the Board in carrying out its duties under this section, the
Board shall distribute all amounts in the Fund to States or
Indian tribes to fund public benefits programs under
paragraph (1).
(B) Fund share.--
(i) In general.--Subject to clause (iii), the Fund share of
a public benefits program funded under paragraph (1) shall be
50 percent.
(ii) Proportionate reduction.--To the extent that the
amount of matching funds requested by States and Indian
tribes exceeds the maximum projected revenues of the Fund,
matching funds distributed to the States and Indian tribes
shall be reduced by an amount that is proportionate to each
State's annual consumption of electricity compared to the
Nation's aggregate annual consumption of electricity.
(iii) Additional state or indian tribe funding.--State or
Indian tribe may apply funds to public benefits programs in
addition to the amount of funds applied for the purpose of
matching the Fund share.
(3) Program criteria.--The Board shall recommend
eligibility criteria for public benefits programs funded
under this section for approval by the Secretary of Energy.
(4) Application.--Not later than August 1 of each year
beginning in 2002, a State or Indian tribe seeking matching
funds for the following fiscal year shall file with the
Board, in such form as the Board may require, an
application--
(A) certifying that the funds will be used for an eligible
public benefits program;
(B) stating the amount of State or Indian tribe funds
earmarked for the program; and
(C) summarizing how System Benefit Trust Fund funds from
the previous calendar year (if any) were spent by the State
and what the State accomplished as a result of these
expenditures.
(e) Wires Charge.--

[[Page S10731]]

(1) Determination of needed funding.--Not later than August
1 of each year, the Board shall determine and inform the
Federal Energy Regulatory Commission of the aggregate amount
of wires charges that will be necessary to be paid into the
Fund to pay matching funds to States and Indian tribes and
pay the operating costs of the Board in the following fiscal
year.
(2) Imposition of wires charge.--
(A) In general.--Not later than December 15 of each year,
the Federal Energy Regulatory Commission shall impose a
nonbypassable, competitively neutral wires charge, to be paid
directly into the Fund by the operator of the wire, on
electricity carried through the wire (measured as it
exists the busbar at a generation facility, or, for
electricity generated outside the United States, at the
point of delivery to the wire operator's system) in
interstate commerce.
(B) Amount.--The wires charge shall be set at a rate equal
to the lesser of
(i) 2.0 mills per kilowatt hour; or
(ii) a rate that is estimated to result in the collection
of an amount of wires charges that is as nearly as possible
equal to the amount of needed funding determined under
paragraph (1).
(3) Deposit in the fund.--The wires charge shall be paid by
the operator of the wire directly into the Fund at the end of
each month during the calendar year for distribution by the
Board under subsection (c).
(4) Penalties.--The Federal Energy Regulatory Commission
may assess against a wire operator that fails to pay a wires
charge as required by this subsection a civil penalty in an
amount equal to not more than the amount of the unpaid wires
charge.
(e) Auditing.--
(1) In general.--The Fund shall be audited annually by a
firm of independent certified public accountants in
accordance with generally accepted auditing standards.
(2) Access to records.--Representatives of the Secretary of
Energy and the Federal Energy Regulatory Commission shall
have access to all books, accounts, reports, files, and other
records pertaining to the Fund as necessary to facilitate and
verify the audit.
(3) Reports.--
(A) In general.--A report on each audit shall be submitted
to the Secretary of Energy, the Federal Energy Regulatory
Commission, and the Secretary of the Treasury, who shall
submit the report to the President and Congress not later
than 180 days after the close of the fiscal year.
(B) Requirements.--An audit report shall--
(i) set forth the scope of the audit; and
(ii) include--
(I) a statement of assets and liabilities, capital, and
surplus or deficit;
(II) a surplus or deficit analysis;
(III) a statement of income and expenses;
(IV) any other information that may be considered necessary
to keep the President and Congress informed of the operations
and financial condition of the Fund; and
(V) any recommendations with respect to the Fund that the
Secretary of Energy or the Federal Energy Regulatory
Commission may have.
______

SA 1524. Mr. JEFFORDS submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 165 after line 14 insert:
(d) License Terms.--Section 6 and section 101(i) of the
Federal Power Act (16 U.S.C. 799 and 803(i) are each amended
by striking ``fifty'' and inserting ``thirty'' and section
15(e) of such Act is amended by striking ``not less than 30
years, nor more than 50'' and inserting ``not more than 15.''
______

SA 1525. Mr. JEFFORDS submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 54 strike line 14 and all that follows through line
24, page 55, and insert:
(b) Designation of Qualified Staff.--The Administrator of
the Environmental Protection Agency, the Secretary of
Agriculture and the Chief of the Corps of Engineers may
assign persons under their employment to each of the field
offices identified in subsection (c) upon each making a
determination as to such employees that to make such
assignments shall not create undue staffing shortages within
their respective agencies; that all statutory obligations
fulfilled by such employees will continue to be fully met in
accordance with existing law; and that no other undue
administrative or other burdens shall be created by virtue of
such assignments. Employees available for such assignments
may include those having expertise in the Endangered Species
Act; the Clean Air Act; the Clean Water Act; the National
Environmental Policy Act; the National Forest Management Act;
or such other expertise as the Administrator of the
Environmental Protection Agency, the Secretary of Agriculture
or the Chief of the Corps of Engineers may find appropriate
for persons within their employment.
(c) Field Offices.--The following BLM Field Offices shall
serve as the Federal Permit Streamlining Pilot Project
offices:
(1) Rawlins, Wyoming.
(2) Buffalo, Wyoming;
(3) Miles City, Montana;
(4) Farmington, New Mexico;
(5) Carlsbad, New Mexico;
(6) Glenwood Springs, Colorado.
(d) Reports.--The Secretary, the Administrator of the
Environmental Protection Agency, the Secretary of Agriculture
and the Chief of the Corps of Engineers shall submit a report
to Congress 1 year following the date of enactment of this
section, outlining the results of the Pilot Project and
including a recommendation to the President as to whether the
Pilot Project should be implemented nationwide.
(e) Additional personnel.--The Secretary shall assign to
each of the BLM Field Offices listed in subsection (c) such
additional personnel of the Department of the Interior as is
necessary to ensure the effective implementation of--
______

SA 1526. Mr. JEFFORDS submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 53 strike line 5 and all that follows through line
22.
______

SA 1527. Mr. JEFFORDS submitted an amendment intended to be proposed
to amendment SA 1412 proposed by Mr. Domenici (for himself, Ms.
Landrieu, Mr. Thomas, Ms. Murkowski, Mr. Campbell, Mr. Smith, Mr.
Alexander, Mr. Kyl, Mr. Nelson of Nebraska, Mr. Hagel, Mr. Talent, Mr.
Bunning, and Mr. Coleman) to the bill S. 14, to enhance the energy
security of the United States, and for other purposes; which was
ordered to lie on the table; as follows:

On page 19 strike Line 7 and all that follows through page
21, line 16, and insert:
(a) Adoption of Standard.--At the end of the Public Utility
Regulatory Policies Act of 1978 (16 U.S.C. 2601 et seq.) add
the following:

``TITLE____NET METERING

``SEC.  . NET METERING STANDARDS.

``(a) Requirement to Provide Service.--Each electric
utility shall make available upon request net metering
service to any electric consumer that the electric utility
serves in accordance with this section.
``(b) Establishment of Standards.--Net metering service
under this section shall be provided in accordance with the
following standards:
``(1) An electric utility.--
``(A) shall charge the owner or operator of an on-site
generating facility rates and charges that are identical to
those that would be charged other electric consumers of the
electric utility in the same rate class; and
``(B) shall not charge the owner or operator of an on-site
generating facility any additional standby, capacity,
interconnection, or other rate or charge.
``(2) An electric utility that sells electric energy to the
owner or operator of an on-site generating facility shall
measure the quantity of electric energy produced by the on-
site facility and the quantity of electric energy consumed by
the owner or operator of an on-site generating facility shall
measure the quantity of electric energy produced by the on-
site facility and the quantity of electric energy consumed by
the owner or operator of an on-site generating facility
during a billing period in accordance with reasonable
metering practices.
``(3) If the quantity of electric energy sold by the
electric utility to an on-site generating facility exceeds
the quantity of electric energy supplied by the on-site
generating facility to the electric utility during the
billing period, the electric utility may bill the owner or
operator for the net quantity of electric energy sold, in
accordance with reasonable metering practices.
``(4) If the quantity of electric energy supplied by the
on-site generating facility to the electric utility exceeds
the quantity of electric energy sold by the electric utility
to the on-site generating facility during the billing
period--
``(A) the electric utility may bill the owner or operator
of the on-site generating facility for the appropriate
charges for the billing period in accordance with
paragraph (2); and
``(B) the owner or operator of the on-site generating
facility shall be credited for the excess kilowatt-hours
generated during the billing period, with the kilowatt-hour
credit appearing on the bill for the following billing
period.
``(5) An eligible on-site generating facility and net
metering system used by an electric consumer shall meet all
applicable safety, performance, reliability, and
interconnection standards established by the National
Electric Code, the Institute of Electrical and Electronics
Engineers, and Underwriters Laboratories.
``(6) The Commission, after consultation with State
regulatory authorities and unregulated electric utilities and
after notice and opportunity for comment, may adopt, by rule,
additional control and testing requirements for on-site
generating facilities and net metering systems that the
Commission determines are necessary to protect public safety
and system reliability.
(c) Definitions.--For purposes of this section:
``(1) the term `eligible on-site generating facility' means
a facility on the site of a residential electric consumer
with a maximum

[[Page S10732]]

generating capacity of 10 kilowatts or less that is fueled by
solar energy, wind energy, or fuel cells; or a facility on
the site of a commercial electric consumer with a maximum
generating capacity of 500 kilowatts or less that is fueled
solely by a renewable energy resource, landfill gas, or a
high efficiency system.
``(2) The term `renewable energy resource' means solar,
wind, biomass, or geothermal energy.
``(3) The term `high efficiency system' means fuel cells or
combined heat and power.
``(4) The term `net metering service' means service to an
electric consumer under which electric energy generated by
that electric consumer from an eligible on-site generating
facility and delivered to the local distribution facilities
may be used to offset electric energy provided by the
electric utility to the electric consumer during the
applicable billing period.''.
______

SA 1528. Mr. JEFFORDS submitted an amendment intended to be proposed
by him to the bill S. 14 to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 165 after line 14 insert:
(d) Annual Licenses.--Section 15(a)(1) of the Federal Power
Act (16 U.S.C. 808(a)(1)) is amended by adding the following
at the end thereof: ``Annual licenses shall contain such
terms and conditions appropriate for the duration of the
annual license which are identified by the Secretary of the
Interior and the Secretary of Agriculture as necessary for
the protection and utilization of the reservation within
which the project is located; by the Secretary of the
Interior and the Secretary of Commerce for the protection and
enhancement of fish and wildlife, including related spawning
grounds and habitat; and by the Governor of the State in
which the project is located for compliance with water
standards and other legal requirements for beneficial uses of
affected water. The terms of any new license for a project
shall be reduced by one year for each annual license issued
for such project.''
______

SA 1529. Mr. JEFFORDS submitted an amendment intended to be proposed
by him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

At the end of section 114, add the following:

SEC.   . RISK-BASED DATA MANAGEMENT SYSTEMS.

(a) In General.--The Secretary of Energy shall make grants
to the Ground Water Protection Council to develop risk-based
data management systems.
(b) Report.--Not later than sixty days after the end of
each fiscal year, the Ground Water Protection Council shall
report to the Secretary on the progress in developing risk-
based data management systems and on any other functions or
activities undertaken including the identification of any
other individuals or entities that receive secondary grants,
using funds provided under this section.
(c) Authorization of Appropriations.--There are authorized
to be appropriated to carry out this section, $1,000,000 for
fiscal years 2004-2007.
______

SA 1530. Mr. JEFFORDS (for himself, Mr. Kerry, Mr. Reid, Mr. Durbin,
and Mr. Lautenberg) submitted an amendment intended to be proposed by
him to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

On page 467, after line 16, add the following:

Subtitle I--Renewable Portfolio Standard

SEC. 192. RENEWABLE PORTFOLIO STANDARD.

Title VI of the Public Utility Regulatory Policies Act of
1978 (16 U.S.C. 2601 et seq.) is amended by adding at the end
the following:

``SEC. 606. FEDERAL RENEWABLE PORTFOLIO STANDARD.

``(a) Renewable Energy Requirements.--
``(1) In general.--For each calendar year beginning in
Calendar year 2006, each retail electric supplier shall
submit to the Secretary, not later than April 30 of each
year, renewable energy credits in an amount equal to the
required annual percentage of the retail electric supplier's
total amount of kilowatt-hours of non-hydropower (excluding
incremental hydropower) electricity sold to retail consumers
during the previous calendar year.
``(2) Carryover.--A renewable energy for any year that is
not used to satisfy the minimum requirement for that year may
be carried over for use within the next two years.
``(b) Required Annual Percentage.--Of the total amount of
non-hydropower (excluding incremental hydropower) electricity
sold by each retail electric supplier during a calendar year,
the amount generated by renewable energy sources shall be not
less than the percentage specified below:

[In percent]

Percentage of
Renewable energy
Calendar years:                                              each year:
2006-2009.......................................................5....

2010-2014......................................................10....

2015-2019......................................................15....

2020 and subsequent years......................................20....

``(c) Submission of Renewable Energy Credits.--
``(1) In general.--To meet the requirements under
subsection (a), a retail electric supplier shall submit to
the Secretary either--
``(A) renewable energy credits issued to the retail
electric supplier under subsection (e);
``(B) renewable energy credits obtained by purchase or
exchange under subsection (f);
``(C) renewable energy credits purchased from the United
States under subsection (g); or
``(D) any combination of credits under subsections (e), (f)
or (g).
``(2) Prohibition on double counting.--A credit may be
counted toward compliance with subsection (a) only once.
``(d) Renewable Energy Credit Program.--The Secretary shall
establish, not later than 1 year after the date of enactment
of this Act, a program to issue, monitor the sale or exchange
of, and track, renewable energy credits.
``(e) Issuance of Renewable Energy Credits.--
``(1) In general.--Under the program established in
subsection (d), 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.
``(2) Application.--An application for the issuance of
renewable energy credits shall indicate--
``(A) the type of renewable energy resource used to produce
the electric energy;
``(B) the State in which the electric energy was produced;
and
``(C) any other information the Secretary determines
appropriate.
``(3) Credit value.--Except as provided in subparagraph
(4), the Secretary shall issue to an entity applying under
this subsection one renewable energy credit for each
kilowatt-hour of renewable energy generated in any State from
the date of enactment of this Act and in each subsequent
calendar year.
``(4) Credit value for distributed generation.--The
Secretary shall issue three renewable energy credits for each
kilowatt-hour of distributed generation.
``(5) Vesting.--A renewable energy credit will vest with
the owner of the system or facility that generates the
renewable energy unless such owner explicitly transfers the
credit.
``(6) Credit eligibility.--To be eligible for a renewable
energy credit, the unit of electricity generated through the
use of a renewable energy resource shall be sold for retail
consumption or 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
renewable energy credits on the proportion of the renewable
energy resource used.
``(7) Identifying credits.--The Secretary shall identify
renewable energy credits by the type and date of generation.
``(8) Sale under purpa contract.--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 the Public Utilities
Regulatory Policies Act of 1978 (16 U.S.C. 824a-3), the
retail electric supplier is treated as the generator of the
electric energy for the purposes of this Act for the duration
of the contracts.
``(f) Sale or Exchange of Renewable Energy Credits.--A
renewable energy credit may be sold or exchanged by the
entity issued the renewable energy credit or by any other
entity that acquires the renewable energy credit. Credits
may be sold or exchanged in any manner not in conflict
with existing law, including on the spot market or by
contractual arrangements of any duration.
``(g) Purchase From the United States.--The Secretary shall
offer renewable energy credits for sale at the lesser of
three cents per kilowatt-hour or 110 percent of the average
market value of credits for the applicable compliance period.
On January 1 of each year following calendar year 2006, the
Secretary shall adjust for inflation the price charged per
credit for such calendar year.
``(h) State Programs.--Nothing in this section shall
preclude any State from requiring additional renewable energy
generation in the State under any renewable energy program
conducted by the State.
``(i) Consumer Allocation.--The rates charged to classes of
consumers by a retail electric supplier shall reflect a
proportional percentage of the cost of generating or
acquiring the required annual percentage of renewable energy
under subsection (a). A retail electric supplier shall not
represent to any customer or prospective customer that any
product contains more than the percentage of eligible
resources if the additional amount of eligible resources is
being used to satisfy the renewable generation requirement
under subsection (a).
``(j) Enforcement.--A retail electric supplier that does
not submit renewable energy credits as required under
subsection (a) shall be liable for the payment of a civil
penalty. That penalty shall be calculated on the basis of the
number of renewable energy credits not submitted, multiplied
by the lesser of 4.5 cents or 300 percent of the average
market value of credits for the compliance period.
``(k) Information Collection.--The Secretary may collect
the information necessary to verify and audit--

[[Page S10733]]

``(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.
``(l) Voluntary Participation.--The Secretary may issue a
renewable energy credit pursuant to subsection (e) to any
entity not subject to the requirements of this Act only if
the entity applying for such credit meets the terms and
conditions of this Act to the same extent as entities subject
to this Act.
``(m) State Renewable Energy Grant Program.--
``(1) Distribution to states.--The Secretary shall
distribute amounts received from sales under subsection (g)
and from amounts received under subsection (j) to States to
be used for the purposes of this section.
``(2) Regional equity program.--
``(A) Establishment of program.--Within one year from the
date of enactment of this Act, the Secretary shall establish
a program to promote renewable energy production and use
consistent with the purposes of this section.
``(B) Eligibility.--The Secretary shall make funds
available under this section to State energy agencies for
grant programs for--
``(i) renewable energy research and development;
``(ii) loan guarantees to encourage construction of
renewable energy facilities;
``(iii) consumer rebate or other programs of offset costs
of small residential or small commercial renewable energy
systems including solar hot water; or
``(iv) promoting distributed generation.
``(3) Allocation preferences.--In allocating funds under
the program, the Secretary shall give preference to--
``(A) States in regions which have a disproportionately
small share of economically sustainable renewable energy
generation capacity; and
``(B) State grant programs most likely to stimulate or
enhance innovative renewable energy technologies.
``(n) Definitions.--In this section.
``(1) Biomass.--
``(A) In general.--The term ``biomass'' means--
``(i) organic material from a plant that is planted for the
purpose of being used to produce energy;
``(ii) nonhazardous, cellulosic or agricultural waste
material that is segregated from other waste materials and is
derived from--
``(I) a forest-related resource, including--
``(aa) mill and harvesting residue;
``(bb) precommercial thinnings;
``(cc) slash; and
``(dd) brush;
``(II) agricultural resources, including--
``(aa) orchard tree crops;
``(bb) vineyards;
``(cc) grains;
``(dd) legumes;
``(ee) sugar; and
``(ff) other crop by-products or residues; or
``(III) miscellaneous waste such as--
``(aa) waste pallet;
``(bb) crate; and
``(cc) landscape or right-of-way tree trimmings;
``(iii) animal waste that is converted to a fuel rather
than directly combusted, the residue of which is converted to
a biological fertilizer, oil, or activated carbon.
``(B) Exclusions.--The term `biomass' shall not include--
``(i) municipal solid waste that is incinerated;
``(ii) recyclable post-consumer waste paper;
``(iii) painted, treated, or pressurized wood;
``(iv) wood contaminated with plastics or metals; or
``(v) tires.
``(2) Distributed generation.--The term `distributed
generation' means reduced electricity consumption from the
electric grid due to use by a customer of renewable energy
generated at a customer site.
``(3) Incremental hyrdopower.--The term `incremental
hydropower' means additional generation achieved from
increased efficiency after January 1, 2003, at a
hydroelectric dam that was placed in service before January
1, 2003.
``(4) Landfill gas.--The term `landfill gas' means gas
generated from the decomposition of household solid waste,
commercial solid waste, and industrial solid waste disposed
of in a municipal solid waste landfill unit (as those terms
are defined in regulations promulgated under subtitle D of
the Solid Waste Disposal (42 U.S.C. 6941 et seq.)).
``(5) Renewable energy.--The term `renewable energy' means
electricity generated from--
``(A) A renewable energy source; or
``(B) hydrogen that is produced from a renewable energy
source.
``(5) The term `renewable energy source' means--
``(A) wind;
``(B) oceans waves;
``(C) biomass;
``(D) solar;
``(E) landfill gas;
``(F) incremental hydropower; or
``(G) geothermal.
``(6) Retail electric supplier.--The term `retail electric
supplier' means a person or entity that sells retail
electricity to consumers, and which sold not less than
500,000 megawatts of electric energy to consumers for
purposes other than resale during the preceding calendar
year.
``(7) Secretary.--The term `Secretary' means the Secretary
of Energy.
______

SA 1531. Ms. LANDRIEU submitted an amendment intended to be proposed
by her to the bill S. 14, to enhance the energy security of the United
States, and for other purposes; which was ordered to lie on the table;
as follows:

In section 32 of the Outer Continental Shelf Lands Act (as
added by section 111), strike subsections (c) and (d) and
insert the following:
``(c) Impact Assistance Payments to States and Political
Subdivisions.--The Secretary shall make payments from the
amounts available under this section to Producing Coastal
States with an approved Coastal Impact Assistance Plan, and
to coastal political subdivisions as follows:
``(1) Of the amounts appropriated, the allocation for each
Producing Coastal State shall be calculated based on the
ratio of qualified Outer Continental Shelf revenues generated
off the coastline of the Producing Coastal State to the
qualified Outer Continental Shelf revenues generated off the
coastlines of all Producing Coastal States for each fiscal
year. Where there is more than one Producing Coastal State
within 200 miles of a leased tract, the amount of each
Producing Coastal State's allocation for such leased tract
shall be inversely proportional to the distance between the
nearest point on the coastline of such State and the
geographic center of each leased tract or portion of the
leased tract (to the nearest whole mile) that is within 200
miles of that coastline, as determined by the Secretary.
``(2)(A) Thirty-five percent of each Producing Coastal
State's allocable share as determined under paragraph (1)
shall be paid directly to the coastal political subdivisions
by the Secretary based on the following formula:
``(i) Twenty-five percent shall be allocated based on the
ratio of such coastal political subdivision's coastal
population to the coastal population of all coastal political
subdivisions in the Producing Coastal State.
``(ii) Twenty-five percent shall be allocated based on the
ratio of such coastal political subdivision's coastline miles
to the coastline miles of a coastal political subdivision in
the Producing Coastal State except that for those coastal
political subdivisions in the State of Louisiana without a
coastline, the coastline for purposes of this element of the
formula shall be the average length of the coastline of the
remaining coastal subdivisions in the state.
``(iii) Fifty percent shall be allocated based on the
relative distance of such coastal political subdivision from
any leased tract used to calculate the Producing Coastal
State's allocation using ratios that are inversely
proportional to the distance between the point in the coastal
political subdivision closest to the geographic center of
each leased tract or portion, as determined by the Secretary,
except that in the State of Alaska, the funds for this
element of the formula shall be divided equally among the two
closest coastal political subdivisions. For purposes of the
calculations under this clause, a leased tract or portion of
a leased tract shall be excluded if the leased tract or
portion is located in a geographic area where a moratorium on
new leasing was in effect on January 1, 2002, unless the
lease was issued prior to the establishment of the moratorium
and was in production on January
``(B) Of the allocable share of the State of Louisiana as
determined under paragraph (1), the Secretary shall pay--
``(i) 17.5 percent directly to coastal political
subdivisions in the State of Louisiana in accordance with the
formula described in clauses (i) through (iii) of
subparagraph (A) to be used for--
``(I) wetland protection and restoration;
``(II) land and water conservation;
``(III) flood control and drainage;
``(IV) watewater treatment;
``(V) parks and recreation; and
``(VI) bridge repair and replacement;
``(ii) 17.5 percent to a coastal infrastructure restoration
fund maintained by the State of Louisiana to be used for--
``(I) barrier island restoration;
``(II) wildlife and wetland research and education;
``(III) Atchafalaya Basin preservation;
``(IV) State Land and Water Conservation Fund activities;
and
``(V) coastal commerce and development.
``(3) Any amount allocated to a Producing Coastal State or
coastal political subdivision but not disbursed because of a
failure to have an approved Coastal Impact Assistance Plan
under this section shall be allocated equally by the
Secretary among all other Producing Coastal States in a
manner consistent with this subsection except that the
Secretary shall hold in escrow such amount until the final
resolution of any appeal regarding the disapproval of a plan
submitted under this section. The Secretary may waive the
provisions of this paragraph and hold a Producing Coastal
State's allocable share in escrow if the Secretary determines
that such State is making a good faith effort to develop and
submit, or update, a Coastal Impact Assistance Plan.
``(4) For purposes of this subsection, calculations of
payments for fiscal years 2004 through 2006 shall be made
using qualified Outer Continental Shelf revenues received in

[[Page S10734]]

fiscal year 2003, and calculations of payments for fiscal
years 2007 through 2009 shall be made using qualified Outer
Continental Shelf revenues received in fiscal year 2006.
``(d) Coastal Impact Assistance Plan.--
``(1) The Governor of each Producing Coastal State shall
prepare, and submit to the Secretary, a Coastal Impact
Assistance Plan. The Governor shall solicit local input and
shall provide for public participation in the development of
the plan. The plan shall be submitted to the Secretary by
July 1, 2004. Amounts received by Producing Coastal States
and coastal political subdivisions may be used only for the
purposes specified in the Producing Coastal State's Coastal
Impact Assistance Plan.
``(2) The Secretary shall approve a plan under paragraph
(1) prior to disbursement of amounts under this section. The
Secretary shall approve the plan if the Secretary determines
that the plan is consistent with the uses set forth in
subsection (f) of this section and if the plan contains--
``(A) the name of the State agency that will have the
authority to represent and act for the State in dealing with
the Secretary for purposes of this section;
``(B) a program for the implementation of the plan which
describes how the amounts provided under this section will be
used;
``(C) a contact for each political subdivision and
description of how coastal political subdivisions will use
amounts provided under this section, including a
certification by the Governor that such uses are consistent
with the requirements of this section;
``(D) certification by the Governor that ample opportunity
has been accorded for public participation in the development
and revision of the plan; and
``(E) measures for taking into account other relevant
Federal resources and programs.
``(3) The Secretary shall approve or disapprove each plan
or amendment within 90 days of its submission.
``(4) Any amendment to the plan shall be prepared in
accordance with the requirements of this subsection and shall
be submitted to the Secretary for approval or disapproval.
``(5) Coastal impact assistance plans of coastal political
subdivisions.--
``(A) In general.--A Coastal Impact Assistance Plan for the
State of Louisiana shall include a coastal impact assistance
plan developed by each coastal political subdivision in the
State of Louisiana.
``(B) Approval.--In approving the plans of the coastal
political subdivisions, the Governor of the State of
Louisiana shall have the authority only to ensure that the
proposed uses of funds that are included in the plans of the
coastal political subdivisions are consistent with the
authorized uses under subsection (e).
______

SA 1532. Mr. LAUTENBERG submitted an amendment intended to be
proposed by him to the bill S. 14, to enhance the energy security of
the United States, and for other purposes; which was ordered to lie on
the table; as follows:

At the end of title I of division B add the following:

SEC. 102. EXPANSION OF CREDIT FOR ELECTRICITY PRODUCED FROM
CERTAIN RENEWABLE RESOURCES TO INCLUDE WAVE
ENERGY.

(a) In General.--Section 45(c)(1) (defining qualified
energy resources), as amended by this Act, is amended--
(1) by striking ``and'' at the end of subparagraph (G),
(2) by striking the period at the end of subparagraph (H)
and inserting ``, and'', and
(3) by adding at the end the following new subparagraph:
``(I) wave energy.''.
(b) Wave Energy.--Section 45(c), as amended by this Act, is
amended by adding at the end the following new paragraph:
``(8) Wave energy.--The term `wave energy' means energy
derived from the energy stored in ocean waves.''.
(c) Wave Energy Facility.--Section 45(d) (relating to
qualified facilities), as amended by this Act, is amended by
adding at the end the following new paragraph:
``(8) Wave energy facility.--In the case of a facility
using wave energy to produce electricity, the term `qualified
facility' means any facility owned by the taxpayer which is
originally placed in service after the date of the enactment
of the Energy Tax Incentives Act of 2003 and before January
1, 2007.''.
(d) Effective Date.--The amendments made by this section
shall apply to electricity produced and sold after the date
of the enactment of this Act, in taxable years ending after
such date.
______

SA 1533. Mr. DURBIN (for himself and Mr. Conrad) submitted an
amendment intended to be proposed by him to the bill S. 14, to enhance
the energy security of the United States, and for other purposes; which
was ordered to lie on the table; as follows:

At the end of title VII of division B, insert the
following:

SEC. ____. MODIFICATION OF CREDIT FOR RESIDENTIAL WIND ENERGY
PROPERTY.

(a) Definition of Qualified Wind Energy Property.--Section
25C, as added by this Act, is amended by striking paragraph
(5) of subsection (d) and inserting the following:
``(5) Qualified wind energy property expenditure defined.--
``(A) In general.--The term `qualified wind energy property
expenditure' means an expenditure for qualified wind energy
property installed on or in connection with a dwelling unit
located in the United States and used as a residence by the
taxpayer, including all necessary installation fees and
charges.
``(B) Qualified wind energy property.--The term `qualified
wind energy property' means a qualifying wind turbine--
``(i) the original use of which commences with the
taxpayer, and
``(ii) which carries at least a 5-year limited warranty
covering defects in design, material, or workmanship, and,
for any qualifying wind turbine that is not installed by the
taxpayer, at least a 5-year limited warranty covering defects
in installation.
``(C) Qualifying wind turbine.--The term `qualifying wind
turbine' means a wind turbine of 75 kilowatts of rated
capacity or less which at the time of manufacture and not
more than 1 year from the date of purchase meets the latest
performance rating standards published by the American Wind
Energy Association or the International Electrotechnical
Commission and which is used to generate electricity.''.
(b) Amount of Credit.--
(1) In general.--Subsection (b)(1) of section 25C, as added
by this Act, is amended by striking ``and'' at the end of
subparagraph (B), by redesignating subparagraph (C) as
subparagraph (D), and by inserting after subparagraph (B) the
following:
``(C) $1,000 for each kilowatt of capacity of property
described in subsection (d)(5), and''.
(2) Conforming amendment.--Subparagraph (A) of section
25C(b)(1), as added by this Act, is amended by striking ``,
(2), or (5)'' and inserting ``or (2)''.
(c) Other Modifications.--
(1) Paragraph (7) of section 25C(d) (relating to labor
costs), as added by this Act, is amended by inserting ``or
the local energy grid'' after ``dwelling unit''.
(2) Paragraph (5) of section 25C(e) (relating to special
rules), as added by this Act, is amended by inserting ``and,
in the case of qualified wind energy property, the property
has begun to be used to generate electricity'' before the
period.
(c) Effective Date.--The amendments made by this section
shall apply to expenditures made after the date of the
enactment of this Act, in taxable years ending after such
date.

SEC. ____. CREDIT FOR BUSINESS INSTALLATION OF SMALL WIND
ENERGY PROPERTY.

(a) In General.--Subparagraph (A) of section 48(a)(3), as
amended by this Act, (defining energy property) is amended by
striking ``or'' at the end of clause (iii), by adding ``or''
at the end of clause (iv), and by inserting after clause (iv)
the following new clause:
``(v) qualified wind energy property installed before
January 1, 2009,''.
(b) Qualified Wind Energy Property.--Subsection (a) of
section 48, as amended by this Act, is amended by
redesignating paragraphs (6) and (7) as paragraphs (7) and
(8), respectively, and by inserting after paragraph (5) the
following new paragraph:
``(6) Qualified wind energy property.--For purposes of this
subsection--
``(A) In general.--The term `qualified wind energy
property' means a qualifying wind turbine--
``(i) installed on or in connection with a farm (as defined
in section 6420(c)), a ranch, or an establishment of an
eligible small business (as defined in section 44(b)) which
is located in the United States and which is owned and used
by the taxpayer,
``(ii) the original use of which commences with the
taxpayer, and
``(iii) which carries at least a 5-year limited warranty
covering defects in design, material, or workmanship, and,
for any qualifying wind turbine that is not installed by the
taxpayer, at least a 5-year limited warranty covering defects
in installation.
``(B) Limitation.--In the case of any qualified wind energy
property placed in service during the taxable year, the
credit determined under paragraph (1) for such year with
respect to such property shall not exceed an amount equal to
the lesser of--
``(i) 30 percent of the basis of such property, including
all necessary installation fees and charges, or
``(ii) $1,000 for each kilowatt of capacity of such
property.
``(C) Qualifying wind turbine.--For purposes of this
paragraph the term `qualifying wind turbine' means a wind
turbine of 75 kilowatts of rated capacity or less which at
the time of manufacture and not more than 1 year after the
date of purchase meets the latest performance rating
standards published by the American Wind Energy Association
or the International Electrotechnical Commission and which is
used to generate electricity.
``(D) Safety certifications.--No credit shall be allowed
under this section for any qualified wind energy property
unless such property meets appropriate fire and electric code
requirements.''.
(c) Limitation.--Section 48(a)(2)(A) (relating to energy
percentage), as amended by this Act, is amended redesignating
clause (ii) as clause (iii), by striking ``and'' at the end
of clause (i), and by inserting after clause (i) the
following new clause:
``(ii) in the case of qualified wind energy property, 30
percent, and''.
(d) Conforming Amendments.--
(A) Section 25C(e)(6), as added by this Act, is amended by
striking ``section 48(a)(6)(C)'' and inserting ``section
48(a)(7)(C)''.

[[Page S10735]]

(B) Section 29(b)(3)(A)(i)(III), as amended by this Act, is
amended by striking ``section 48(a)(6)(C)'' and inserting
``section 48(a)(7)(C)''.
(e) Effective Date.--The amendments made by this subsection
shall apply to property placed in service after December 31,
2003, 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).
______

SA 1534. Mr. BINGAMAN (for himself and Mr. Domenici) submitted an
amendment intended to be proposed by him to the bill S. 14, to enhance
the energy security of the United States, and for other purposes; which
was ordered to lie on the table; as follows:

At the appropriate place strike Section 715 and insert the
following:

SEC. 715. REDUCTION OF ENGINE IDLING OF HEAVY-DUTY VEHICLES.

(a) Definitions.--In this section:
(1) Administrator.--The term ``Administrator'' means the
Administrator of the Environmental Protection Agency.
(2) Advanced truck stop electrification system.--The term
``advanced truck stop electrification system'' means a
stationary and independent electrification system that
delivers heat, air conditioning, electricity, communications,
and other convenient services, and is capable of providing
verifiable and auditable evidence of use of those services,
to a heavy-duty vehicle and any occupants of the heavy-duty
vehicle without relying on components mounted onboard the
heavy-duty vehicle for delivery of those services.
(3) Auxiliary power unit.--The term ``auxiliary power
unit'' means an integrated system that--
(A) provides heat, air conditioning, engine warming, and
electricity to the factory-installed components on a heavy-
duty vehicle as if the main drive engine of the heavy-duty
vehicle were running; and
(B) is certified by the Administrator of the Environmental
Protection Agency under part 89 of title 40, Code of Federal
Regulations (or successor regulations), as meeting applicable
emission standards.
(4) Heavy-duty vehicle.--The term ``heavy-duty vehicle''
means a vehicle that--
(A) has a gross vehicle weight rating greater than 12,500
pounds; and
(B) is powered by a diesel engine.
(5) Idle reduction technology.--The term ``idle reduction
technology'' means an advanced truck stop electrification
system, auxiliary power unit, or another device or system of
devices that--
(A) is used to reduce long-duration idling of a heavy-duty
vehicle; and
(B) allows for the main drive engine or auxiliary
refrigeration engine of a heavy-duty vehicle to be shut down.
(6) Long-duration idling.--
(A) In general.--The term ``long-duration idling'' means
the operation of a main drive engine or auxiliary
refrigeration engine of a heavy-duty vehicle, for a period
greater than 15 consecutive minutes, at a time at which the
main drive engine is not engaged in gear.
(B) Exclusions.--The term ``long-duration idling'' does not
include the operation of a main drive engine or auxiliary
refrigeration engine of a heavy-duty vehicle during a routine
stoppage associated with traffic movement or congestion.
(b) Idle Reduction Technology Benefits, Programs, and
Studies.--
(1) In general.--Not later than 90 days after the date of
enactment of this Act, the Administrator shall--
(A)(i) commence a review of the mobile source air emission
models of the Environmental Protection Agency used under the
Clean Air Act (42 U.S.C. 7401 et seq.) to determine whether
the models accurately reflect the emissions resulting from
long-duration idling of heavy-duty vehicles and other
vehicles and engines; and
(ii) update those models as the Administrator determines to
be appropriate; and
(B)(i) commence a review of the emission reductions
achieved by the use of idle reduction technology; and
(ii) complete such revisions of the regulations and
guidance of the Environmental Protection Agency as the
Administrator determines to be appropriate.
(2) Deadline for completion.--Not later than 180 days after
the date of enactment of this Act, the Administrator shall--
(A) complete the reviews under subparagraphs (A)(i) and
(B)(i) of paragraph (1); and
(B) prepare and make publicly available 1 or more reports
on the results of the reviews.
(3) Discretionary inclusions.--The reviews under
subparagraphs (A)(i) and (B)(i) of paragraph (1) and the
reports under paragraph (2)(B) may address the potential fuel
savings resulting from use of idle reduction technology.
(4) Idle reduction deployment program.--
(A) In general.--Not later than 90 days after the date of
the enactment of this Act, the Administrator, in consultation
with the Secretary of Transportation, shall establish a
program to support deployment of idle reduction technology
that benefits strategic locations based on air quality and
congestion considerations.
(B) Authorization of appropriations.--There are authorized
to be appropriated to the Administrator such sums as are
necessary to carry out subparagraph (A).
(5) Idling location study.--
(A) In general.--Not later than 90 days after the date of
the enactment of this Act, the Secretary of Transportation,
in consultation with the Administrator, shall commence a
study to analyze all locations at which heavy-duty vehicles
stop for long duration idling, including--
(i) truck stops;
(ii) rest areas;
(iii) border crossings;
(iv) ports;
(v) transfer facilities; and
(vi) private terminals.
(B) Deadline for completion.--Not later than 180 days after
the date of enactment of this Act, the Secretary shall--
(i) complete the study under subparagraph (A); and
(ii) prepare and make publicly available 1 or more reports
of the results of the study.
(c) Vehicle Weight Exemption.--Section 127(a) of title 23,
United States Code, is amended--
(1) by designating the first through eleventh sentences as
paragraphs (1) through (11), respectively; and
(2) by adding at the end the following:
``(12) Heavy-duty vehicles.--
``(A) In general.--Subject to subparagraphs (B) and (C), in
order to promote reduction of fuel use and emissions due to
engine idling, the maximum gross vehicle weight limit and the
axle weight limit for any heavy-duty vehicle equipped with an
idle reduction technology shall be increased by a quantity
necessary to compensate for the additional weight of the idle
reduction system.
``(B) Maximum weight increase.--The weight increase under
subparagraph (A) shall be not greater than 250 pounds.
``(C) Proof.--On request by a regulatory or law enforcement
agency, the vehicle operator shall provide proof (through
demonstration or certification) that--
``(i) the idle reduction technology is fully functional at
all times; and
``(ii) the 250-pound gross weight increase is not used for
any purpose other than the use of idle reduction technology
described in subparagraph (A).''
______

SA 1535. Mr. ROCKEFELLER submitted an amendment intended to be
proposed by him to the bill S. 14, to enhance the energy security of
the United States, and for other purposes; which was ordered to lie on
the table; as follows:

On page ____, strike lines ____ and insert the following:
``(B) uses an input of at least 75 percent coal to produce
50 percent or more of its thermal output as electricity,
______

SA 1536. Mr. DURBIN (for himself and Mr. Conrad) submitted an
amendment intended to be proposed by him to the bill S. 14, to enhance
the energy security of the United States, and for other purposes; which
was ordered to lie on the table; as follows:

At the end of title VII of division B, insert the
following:

SEC. ____. CREDIT FOR BUSINESS INSTALLATION OF SMALL WIND
ENERGY PROPERTY.

(a) In General.--Subparagraph (A) of section 48(a)(3), as
amended by this Act, (defining energy property) is amended by
striking ``or'' at the end of clause (iii), by adding ``or''
at the end of clause (iv), and by inserting after clause (iv)
the following new clause:
``(v) qualified wind energy property installed before
January 1, 2009,''.
(b) Qualified Wind Energy Property.--Subsection (a) of
section 48, as amended by this Act, is amended by
redesignating paragraphs (6) and (7) as paragraphs (7) and
(8), respectively, and by inserting after paragraph (5) the
following new paragraph:
``(6) Qualified wind energy property.--For purposes of this
subsection--
``(A) In general.--The term `qualified wind energy
property' means a qualifying wind turbine--
``(i) installed on or in connection with a farm (as defined
in section 6420(c)), a ranch, or an establishment of an
eligible small business (as defined in section 44(b)) which
is located in the United States and which is owned and used
by the taxpayer,
``(ii) the original use of which commences with the
taxpayer, and
``(iii) which carries at least a 5-year limited warranty
covering defects in design, material, or workmanship, and,
for any qualifying wind turbine that is not installed by the
taxpayer, at least a 5-year limited warranty covering defects
in installation.
``(B) Limitation.--In the case of any qualified wind energy
property placed in service during the taxable year, the
credit determined under paragraph (1) for such year with
respect to such property shall not exceed an amount equal
to--10 percent of the basis of such property, including all
necessary installation fees and charges.
``(C) Qualifying wind turbine.--For purposes of this
paragraph the term `qualifying wind turbine' means a wind
turbine of 75 kilowatts of rated capacity or less which at
the time of manufacture and not more than 1 year after the
date of purchase meets the latest performance rating
standards published by the American Wind Energy Association
or the International Electrotechnical Commission and which is
used to generate electricity.
``(D) Safety certifications.--No credit shall be allowed
under this section for any

[[Page S10736]]

qualified wind energy property unless such property meets
appropriate fire and electric code requirements.''.
(c) Limitation.--Section 48(a)(2)(A) (relating to energy
percentage), as amended by this Act, is amended redesignating
clause (ii) as clause (iii), by striking ``and'' at the end
of clause (i), and by inserting after clause (i) the
following new clause:
``(ii) in the case of qualified wind energy property, 10
percent, and''.
(d) Conforming Amendments.--
(A) Section 25C(e)(6), as added by this Act, is amended by
striking ``section 48(a)(6)(C)'' and inserting ``section
48(a)(7)(C)''.
(B) Section 29(b)(3)(A)(i)(III), as amended by this Act, is
amended by striking ``section 48(a)(6)(C)'' and inserting
``section 48(a)(7)(C)''.
(e) Effective Date.--The amendments made by this subsection
shall apply to property placed in service after December 31,
2003, 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).
______

SA 1537. Mr. FRIST (for himself and Mr. Daschle) proposed an
amendment to the bill H.R. 6, to enhance energy conservation and
research and development, to provide for security and diversity in the
energy supply for the American people, and for other purposes; as
follows:

Strike out all after the enacting clause and insert:

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Energy Policy Act of 2003''.

SEC. 2. TABLE OF CONTENTS.

Sec. 1. Short title.
Sec. 2. Table of contents.

DIVISION A--RELIABLE AND DIVERSE POWER GENERATION AND TRANSMISSION

TITLE I--REGIONAL COORDINATION

Sec. 101. Policy on regional coordination.
Sec. 102. Federal support for regional coordination.

TITLE II--ELECTRICITY

Subtitle A--Amendments to the Federal Power Act

Sec. 201. Definitions.
Sec. 202. Electric utility mergers.
Sec. 203. Market-based rates.
Sec. 204. Refund effective date.
Sec. 205. Open access transmission by certain utilities.
Sec. 206. Electric reliability standards.
Sec. 207. Market transparency rules.
Sec. 208. Access to transmission by intermittent generators.
Sec. 209. Enforcement.
Sec. 210. Electric power transmission systems.

Subtitle B--Amendments to the Public Utility Holding Company Act

Sec. 221. Short title.
Sec. 222. Definitions.
Sec. 223. Repeal of the Public Utility Holding Company Act of 1935.
Sec. 224. Federal access to books and records.
Sec. 225. State access to books and records.
Sec. 226. Exemption authority.
Sec. 227. Affiliate transactions.
Sec. 228. Applicability.
Sec. 229. Effect on other regulations.
Sec. 230. Enforcement.
Sec. 231. Savings provisions.
Sec. 232. Implementation.
Sec. 233. Transfer of resources.
Sec. 234. Inter-agency review of competition in the wholesale and
retail markets for electric energy.
Sec. 235. GAO study on implementation.
Sec. 236. Effective date.
Sec. 237. Authorization of appropriations.
Sec. 238. Conforming amendments to the Federal Power Act.

Subtitle C--Amendments to the Public Utility Regulatory Policies Act of
1978

Sec. 241. Real-time pricing and time-of-use metering standards.
Sec. 242. Adoption of additional standards.
Sec. 243. Technical assistance.
Sec. 244. Cogeneration and small power production purchase and sale
requirements.
Sec. 245. Net metering.

Subtitle D--Consumer Protections

Sec. 251. Information disclosure.
Sec. 252. Consumer privacy.
Sec. 253. Office of Consumer Advocacy.
Sec. 254. Unfair trade practices.
Sec. 255. Applicable procedures.
Sec. 256. Federal Trade Commission enforcement.
Sec. 257. State authority.
Sec. 258. Application of subtitle.
Sec. 259. Definitions.

Subtitle E--Renewable Energy and Rural Construction Grants

Sec. 261. Renewable energy production incentive.
Sec. 262. Assessment of renewable energy resources.
Sec. 263. Federal purchase requirement.
Sec. 264. Renewable portfolio standard.
Sec. 265. Renewable energy on Federal land.

Subtitle F--General Provisions

Sec. 271. Change 3 cents to 1.5 cents.
Sec. 272. Bonneville Power Administration bonds.

TITLE III--HYDROELECTRIC RELICENSING

Sec. 301. Alternative conditions and fishways.

TITLE IV--INDIAN ENERGY

Sec. 401. Comprehensive Indian energy program.
Sec. 402. Office of Indian Energy Policy and Programs.
Sec. 403. Conforming amendments.
Sec. 404. Siting energy facilities on tribal lands.
Sec. 405. Indian Mineral Development Act review.
Sec. 406. Renewable energy study.
Sec. 407. Federal Power Marketing Administrations.
Sec. 408. Feasibility study of combined wind and hydropower
demonstration project.

TITLE V--NUCLEAR POWER

Subtitle A--Price-Anderson Act Reauthorization

Sec. 501. Short title.
Sec. 502. Extension of indemnification authority.
Sec. 503. Department of Energy liability limit.
Sec. 504. Incidents outside the United States.
Sec. 505. Reports.
Sec. 506. Inflation adjustment.
Sec. 507. Civil penalties.
Sec. 508. Treatment of modular reactors.
Sec. 509. Effective date.

Subtitle B--Miscellaneous Provisions

Sec. 511. Uranium sales.
Sec. 512. Reauthorization of thorium reimbursement.
Sec. 513. Fast Flux Test Facility.
Sec. 514. Nuclear Power 2010.
Sec. 515. Office of Spent Nuclear Fuel Research.
Sec. 516. Decommissioning pilot program.

Subtitle C--Growth of Nuclear Energy

Sec. 521. Combined license periods.

Subtitle D--NRC Regulatory Reform

Sec. 531. Antitrust review.
Sec. 532. Decommissioning.

Subtitle E--NRC Personnel Crisis

Sec. 541. Elimination of pension offset.
Sec. 542. NRC training program.

DIVISION B--DOMESTIC OIL AND GAS PRODUCTION AND TRANSPORTATION

TITLE VI--OIL AND GAS PRODUCTION

Sec. 601. Permanent authority to operate the Strategic Petroleum
Reserve.
Sec. 602. Federal onshore leasing programs for oil and gas.
Sec. 603. Oil and gas lease acreage limitations.
Sec. 604. Orphaned and abandoned wells on Federal land.
Sec. 605. Orphaned and abandoned oil and gas well program.
Sec. 606. Offshore development.
Sec. 607. Coalbed methane study.
Sec. 608. Fiscal policies to maximize recovery of domestic oil and gas
resources.
Sec. 609. Strategic Petroleum Reserve.
Sec. 610. Hydraulic fracturing.
Sec. 611. Authorization of appropriations.
Sec. 612. Preservation of oil and gas resource data.
Sec. 613. Resolution of Federal resource development conflicts in the
Powder River Basin.

TITLE VII--NATURAL GAS PIPELINES

Subtitle A--Alaska Natural Gas Pipeline

Sec. 701. Short title.
Sec. 702. Findings.
Sec. 703. Purposes.
Sec. 704. Issuance of certificate of public convenience and necessity.
Sec. 705. Environmental reviews.
Sec. 706. Pipeline expansion.
Sec. 707. Federal Coordinator.
Sec. 708. Judicial review.
Sec. 709. State jurisdiction over in-State delivery of natural gas.
Sec. 710. Loan guarantee.
Sec. 711. Study of alternative means of construction.
Sec. 712. Clarification of ANGTA status and authorities.
Sec. 713. Definitions.
Sec. 714. Sense of the Senate.
Sec. 715. Alaskan pipeline construction training program.

Subtitle B--Operating Pipelines

Sec. 721. Environmental review and permitting of natural gas pipeline
projects.

Subtitle C--Pipeline Safety

Part I--Short Title; Amendment of Title 49

Sec. 741. Short title; amendment of title 49, United States Code.

Part II--Pipeline Safety Improvement Act of 2003

Sec. 761. Implementation of Inspector General recommendations.
Sec. 762. NTSB safety recommendations.
Sec. 763. Qualifications of pipeline personnel.
Sec. 764. Pipeline integrity inspection program.
Sec. 765. Enforcement.
Sec. 766. Public education, emergency preparedness, and community
right-to-know.
Sec. 767. Penalties.
Sec. 768. State oversight role.
Sec. 769. Improved data and data availability.
Sec. 770. Research and development.
Sec. 771. Pipeline integrity technical advisory committee.
Sec. 772. Authorization of appropriations.
Sec. 773. Operator assistance in investigations.
Sec. 774. Protection of employees providing pipeline safety
information.
Sec. 775. State pipeline safety advisory committees.
Sec. 776. Fines and penalties.
Sec. 777. Study of rights-of-way.
Sec. 778. Study of natural gas reserve.
Sec. 779. Study and report on natural gas pipeline and storage
facilities in New England.

Part III--Pipeline Security Sensitive Information

Sec. 781. Meeting community right-to-know without security risks.

[[Page S10737]]

Sec. 782. Technical assistance for security of pipeline facilities.
Sec. 783. Criminal penalties for damaging or destroying a facility.

DIVISION C--DIVERSIFYING ENERGY DEMAND AND IMPROVING EFFICIENCY

TITLE VIII--FUELS AND VEHICLES

Subtitle A--CAFE Standards, Alternative Fuels, and Advanced Technology

Sec. 801. Increased fuel economy standards.
Sec. 802. Expedited procedures for congressional increase in fuel
economy standards.
Sec. 803. Revised considerations for decisions on maximum feasible
average fuel economy.
Sec. 804. Extension of maximum fuel economy increase for alternative
fueled vehicles.
Sec. 805. Procurement of alternative fueled and hybrid light duty
trucks.
Sec. 806. Use of alternative fuels.
Sec. 807. Hybrid electric and fuel cell vehicles.
Sec. 808. Diesel fueled vehicles.
Sec. 809. Fuel cell demonstration.
Sec. 810. Bus replacement.
Sec. 811. Average fuel economy standards for pickup trucks.
Sec. 812. Exception to HOV passenger requirements for alternative fuel
vehicles.
Sec. 813. Data collection.
Sec. 814. Green school bus pilot program.
Sec. 815. Fuel cell bus development and demonstration program.
Sec. 816. Authorization of appropriations.
Sec. 817. Temporary biodiesel credit expansion.
Sec. 818. Neighborhood electric vehicles.
Sec. 819. Credit for hybrid vehicles, dedicated alternative fuel
vehicles, and infrastructure.
Sec. 820. Renewable content of motor vehicle fuel.
Sec. 820A. Federal agency ethanol-blended gasoline and biodiesel
purchasing requirement.
Sec. 820B. Commercial byproducts from municipal solid waste loan
guarantee program.

Subtitle B--Additional Fuel Efficiency Measures

Sec. 821. Fuel efficiency of the Federal fleet of automobiles.
Sec. 822. Idling reduction systems in heavy duty vehicles.
Sec. 823. Conserve By Bicycling program.
Sec. 824. Fuel cell vehicle program.

Subtitle C--Federal Reformulated Fuels

Sec. 831. Short title.
Sec. 832. Leaking underground storage tanks.
Sec. 833. Authority for water quality protection from fuels.
Sec. 834. Elimination of oxygen content requirement for reformulated
gasoline.
Sec. 835. Public health and environmental impacts of fuels and fuel
additives.
Sec. 836. Analyses of motor vehicle fuel changes.
Sec. 837. Additional opt-in areas under reformulated gasoline program.
Sec. 838. Federal enforcement of State fuels requirements.
Sec. 839. Fuel system requirements harmonization study.
Sec. 840. Review of Federal procurement initiatives relating to use of
recycled products and fleet and transportation
efficiency.

TITLE IX--ENERGY EFFICIENCY AND ASSISTANCE TO LOW INCOME CONSUMERS

Subtitle A--Low Income Assistance and State Energy Programs

Sec. 901. Increased funding for LIHEAP, weatherization assistance, and
State energy grants.
Sec. 902. State energy programs.
Sec. 903. Energy efficient schools.
Sec. 904. Low income community energy efficiency pilot program.
Sec. 905. Energy efficient appliance rebate programs.

Subtitle B--Federal Energy Efficiency

Sec. 911. Energy management requirements.
Sec. 912. Energy use measurement and accountability.
Sec. 913. Federal building performance standards.
Sec. 914. Procurement of energy efficient products.
Sec. 915. Repeal of energy savings performance contract sunset.
Sec. 916. Energy savings performance contract definitions.
Sec. 917. Review of energy savings performance contract program.
Sec. 918. Federal Energy Bank.
Sec. 919. Energy and water saving measures in congressional buildings.
Sec. 920. Increased use of recovered material in federally funded
projects involving procurement of cement or concrete.

Subtitle C--Industrial Efficiency and Consumer Products

Sec. 921. Voluntary commitments to reduce industrial energy intensity.
Sec. 922. Authority to set standards for commercial products.
Sec. 923. Additional definitions.
Sec. 924. Additional test procedures.
Sec. 925. Energy labeling.
Sec. 926. Energy Star Program.
Sec. 927. Energy conservation standards for central air-conditioners
and heat pumps.
Sec. 928. Energy conservation standards for additional consumer and
commercial products.
Sec. 929. Consumer education on energy efficiency benefits of air-
conditioning, heating, and ventilation maintenance.
Sec. 930. Study of energy efficiency standards.

Subtitle D--Housing Efficiency

Sec. 931. Capacity building for energy efficient, affordable housing.
Sec. 932. Increase of CDBG public services cap for energy conservation
and efficiency activities.
Sec. 933. FHA mortgage insurance incentives for energy efficient
housing.
Sec. 934. Public housing capital fund.
Sec. 935. Grants for energy-conserving improvements for assisted
housing.
Sec. 936. North American Development Bank.
Sec. 937. Capital fund.
Sec. 938. Energy-efficient appliances.
Sec. 939. Energy efficiency standards.
Sec. 940. Energy strategy for HUD.

Subtitle E--Rural and Remote Communities

Sec. 941. Short title.
Sec. 942. Findings and purpose.
Sec. 943. Definitions.
Sec. 944. Authorization of appropriations.
Sec. 945. Statement of activities and review.
Sec. 946. Eligible activities.
Sec. 947. Allocation and distribution of funds.
Sec. 948. Rural and remote community electrification grants.
Sec. 949. Additional authorization of appropriations.
Sec. 950. Rural recovery community development block grants.

DIVISION D--INTEGRATION OF ENERGY POLICY AND CLIMATE CHANGE POLICY

TITLE X--NATIONAL CLIMATE CHANGE POLICY

Subtitle A--Sense of Congress

Sec. 1001. Sense of Congress on climate change.

Subtitle B--Climate Change Strategy

Sec. 1011. Short title.
Sec. 1012. Definitions.
Sec. 1013. National climate change strategy.
Sec. 1014. Office of National Climate Change Policy.
Sec. 1015. Office of Climate Change Technology.
Sec. 1016. Additional offices and activities.

Subtitle C--Science and Technology Policy

Sec. 1021. Global climate change in the Office of Science and
Technology Policy.
Sec. 1022. Director of Office of Science and Technology Policy
Functions.

Subtitle D--Miscellaneous Provisions

Sec. 1031. Additional information for regulatory review.
Sec. 1032. Greenhouse gas emissions from Federal facilities.

TITLE XI--NATIONAL GREENHOUSE GAS DATABASE

Sec. 1101. Purpose.
Sec. 1102. Definitions.
Sec. 1103. Establishment of memorandum of agreement.
Sec. 1104. National Greenhouse Gas Database.
Sec. 1105. Greenhouse gas reduction reporting.
Sec. 1106. Measurement and verification.
Sec. 1107. Independent reviews.
Sec. 1108. Review of participation.
Sec. 1109. Enforcement.
Sec. 1110. Report on statutory changes and harmonization.
Sec. 1111. Authorization of appropriations.

DIVISION E--ENHANCING RESEARCH, DEVELOPMENT, AND TRAINING

TITLE XII--ENERGY RESEARCH AND DEVELOPMENT PROGRAMS

Sec. 1201. Short title.
Sec. 1202. Findings.
Sec. 1203. Definitions.
Sec. 1204. Construction with other laws.

Subtitle A--Energy Efficiency

Sec. 1211. Enhanced energy efficiency research and development.
Sec. 1212. Energy efficiency science initiative.
Sec. 1213. Next generation lighting initiative.
Sec. 1214. Railroad efficiency.
Sec. 1215. High power density industry program.
Sec. 1216. Research regarding precious metal catalysis.

Subtitle B--Renewable Energy

Sec. 1221. Enhanced renewable energy research and development.
Sec. 1222. Bioenergy programs.
Sec. 1223. Hydrogen research and development.

Subtitle C--Fossil Energy

Sec. 1231. Enhanced fossil energy research and development.
Sec. 1232. Power plant improvement initiative.
Sec. 1233. Research and development for advanced safe and efficient
coal mining technologies.
Sec. 1234. Ultra-deepwater and unconventional resource exploration and
production technologies.
Sec. 1235. Research and development for new natural gas transportation
technologies.
Sec. 1236. Authorization of appropriations for Office of Arctic Energy.
Sec. 1237. Clean coal technology loan.

Subtitle D--Nuclear Energy

Sec. 1241. Enhanced nuclear energy research and development.
Sec. 1242. University nuclear science and engineering support.
Sec. 1243. Nuclear energy research initiative.
Sec. 1244. Nuclear energy plant optimization program.
Sec. 1245. Nuclear energy technology development program.

Subtitle E--Fundamental Energy Science

Sec. 1251. Enhanced programs in fundamental energy science.

[[Page S10738]]

Sec. 1252. Nanoscale science and engineering research.
Sec. 1253. Advanced scientific computing for energy missions.
Sec. 1254. Fusion energy sciences program and planning.

Subtitle F--Energy, Safety, and Environmental Protection

Sec. 1261. Critical energy infrastructure protection research and
development.
Sec. 1262. Research and demonstration for remediation of groundwater
from energy activities.--

TITLE XIII--CLIMATE CHANGE SCIENCE AND TECHNOLOGY

Subtitle A--Department of Energy Programs

Sec. 1301. Department of Energy global change research.
Sec. 1302. Amendments to the Federal Nonnuclear Research and
Development Act of 1974.

Subtitle B--Department of Agriculture Programs

Sec. 1311. Carbon sequestration basic and applied research.
Sec. 1312. Carbon sequestration demonstration projects and outreach.
Sec. 1313. Carbon storage and sequestration accounting research.

Subtitle C--International Energy Technology Transfer

Sec. 1321. Clean energy technology exports program.
Sec. 1322. International energy technology deployment program.

Subtitle D--Climate Change Science and Information

Part I--Amendments to the Global Change Research Act of 1990

Sec. 1331. Amendment of Global Change Research Act of 1990.
Sec. 1332. Changes in definitions.
Sec. 1333. Change in committee name and structure.
Sec. 1334. Change in national global change research plan.
Sec. 1335. Integrated Program Office.
Sec. 1336. Research grants.
Sec. 1337. Evaluation of information.

Part II--National Climate Services and Monitoring

Sec. 1341. Amendment of National Climate Program Act.
Sec. 1342. Changes in findings.
Sec. 1343. Tools for regional planning.
Sec. 1344. Authorization of appropriations.
Sec. 1345. National Climate Service Plan.
Sec. 1346. International Pacific research and cooperation.
Sec. 1347. Reporting on trends.
Sec. 1348. Arctic research and policy.
Sec. 1349. Abrupt climate change research.

Part III--Ocean and Coastal Observing System

Sec. 1351. Ocean and coastal observing system.
Sec. 1352. Authorization of appropriations.

Subtitle E--Climate Change Technology

Sec. 1361. NIST greenhouse gas functions.
Sec. 1362. Development of new measurement technologies.
Sec. 1363. Enhanced environmental measurements and standards.
Sec. 1364. Technology development and diffusion.
Sec. 1365. Authorization of appropriations.

Subtitle F--Climate Adaptation and Hazards Prevention

Part I--Assessment and Adaptation

Sec. 1371. Regional climate assessment and adaptation program.
Sec. 1372. Coastal vulnerability and adaptation.
Sec. 1373. Arctic research center.

Part II--Forecasting and Planning Pilot Programs

Sec. 1381. Remote sensing pilot projects.
Sec. 1382. Database establishment.
Sec. 1383. Air quality research, forecasts and warnings.
Sec. 1384. Definitions.
Sec. 1385. Authorization of appropriations.

TITLE XIV--MANAGEMENT OF DOE SCIENCE AND TECHNOLOGY PROGRAMS

Sec. 1401. Definitions.
Sec. 1402. Availability of funds.
Sec. 1403. Cost sharing.
Sec. 1404. Merit review of proposals.
Sec. 1405. External technical review of departmental programs.
Sec. 1406. Improved coordination and management of civilian science and
technology programs.
Sec. 1407. Improved coordination of technology transfer activities.
Sec. 1408. Technology infrastructure program.
Sec. 1409. Small business advocacy and assistance.
Sec. 1410. Other transactions.
Sec. 1411. Mobility of scientific and technical personnel.
Sec. 1412. National Academy of Sciences report.
Sec. 1413. Report on technology readiness and barriers to technology
transfer.
Sec. 1414. United States-Mexico energy technology cooperation.

TITLE XV--PERSONNEL AND TRAINING

Sec. 1501. Workforce trends and traineeship grants.
Sec. 1502. Postdoctoral and senior research fellowships in energy
research.
Sec. 1503. Training guidelines for electric energy industry personnel.
Sec. 1504. National Center on Energy Management and Building
Technologies.
Sec. 1505. Improved access to energy-related scientific and technical
careers.
Sec. 1506. National power plant operations technology and education
center.
Sec. 1507. Federal mine inspectors.

DIVISION F--TECHNOLOGY ASSESSMENT AND STUDIES

TITLE XVI--TECHNOLOGY ASSESSMENT

Sec. 1601. National Science and Technology Assessment Service.

TITLE XVII--STUDIES

Sec. 1701. Regulatory reviews.
Sec. 1702. Assessment of dependence of State of Hawaii on oil.
Sec. 1703. Study of siting an electric transmission system on Amtrak
right-of-way.
Sec. 1704. Updating of insular area renewable energy and energy
efficiency plans.
Sec. 1705. Consumer Energy Commission.
Sec. 1706. Study of natural gas and other energy transmission
infrastructure across the great lakes.
Sec. 1707. National Academy of Sciences study of procedures for
selection and assessment of certain routes for shipment
of spent nuclear fuel from research nuclear reactors.
Sec. 1708. Report on energy savings and water use.
Sec. 1709. Report on research on hydrogen production and use.

DIVISION G--ENERGY INFRASTRUCTURE SECURITY

TITLE XVIII--CRITICAL ENERGY INFRASTRUCTURE

Subtitle A--Department of Energy Programs

Sec. 1801. Definitions.
Sec. 1802. Role of the Department of Energy.
Sec. 1803. Critical energy infrastructure programs.
Sec. 1804. Advisory Committee on Energy Infrastructure Security.
Sec. 1805. Best practices and standards for energy infrastructure
security.

Subtitle B--Department of the Interior Programs

Sec. 1811. Outer Continental Shelf energy infrastructure security.

DIVISION H--ENERGY TAX INCENTIVES

Sec. 1900. Short title; etc.

TITLE XIX--EXTENSION AND MODIFICATION OF RENEWABLE ELECTRICITY
PRODUCTION TAX CREDIT

Sec. 1901. Three-year extension of credit for producing electricity
from wind and poultry waste.
Sec. 1902. Credit for electricity produced from biomass.
Sec. 1903. Credit for electricity produced from swine and bovine waste
nutrients, geothermal energy, and solar energy.
Sec. 1904. Treatment of persons not able to use entire credit.
Sec. 1905. Credit for electricity produced from small irrigation power.
Sec. 1906. Credit for electricity produced from municipal biosolids and
recycled sludge.

TITLE XX--ALTERNATIVE MOTOR VEHICLES AND FUELS INCENTIVES

Sec. 2001. Alternative motor vehicle credit.
Sec. 2002. Modification of credit for qualified electric vehicles.
Sec. 2003. Credit for installation of alternative fueling stations.
Sec. 2004. Credit for retail sale of alternative fuels as motor vehicle
fuel.
Sec. 2005. Small ethanol producer credit.
Sec. 2006. All alcohol fuels taxes transferred to Highway Trust Fund.
Sec. 2007. Increased flexibility in alcohol fuels tax credit.
Sec. 2008. Incentives for biodiesel.
Sec. 2009. Credit for taxpayers owning commercial power takeoff
vehicles.
Sec. 2010. Modifications to the incentives for alternative vehicles and
fuels.

TITLE XXI--CONSERVATION AND ENERGY EFFICIENCY PROVISIONS

Sec. 2101. Credit for construction of new energy efficient home.
Sec. 2102. Credit for energy efficient appliances.
Sec. 2103. Credit for residential energy efficient property.
Sec. 2104. Credit for business installation of qualified fuel cells and
stationary microturbine power plants.
Sec. 2105. Energy efficient commercial buildings deduction.
Sec. 2106. Allowance of deduction for qualified new or retrofitted
energy management devices.
Sec. 2107. Three-year applicable recovery period for depreciation of
qualified energy management devices.
Sec. 2108. Energy credit for combined heat and power system property.
Sec. 2109. Credit for energy efficiency improvements to existing homes.
Sec. 2110. Allowance of deduction for qualified new or retrofitted
water submetering devices.
Sec. 2111. Three-year applicable recovery period for depreciation of
qualified water submetering devices.

TITLE XXII--CLEAN COAL INCENTIVES

Subtitle A--Credit for Emission Reductions and Efficiency Improvements
in Existing Coal-based Electricity Generation Facilities

Sec. 2201. Credit for production from a qualifying clean coal
technology unit.

Subtitle B--Incentives for Early Commercial Applications of Advanced
Clean Coal Technologies

Sec. 2211. Credit for investment in qualifying advanced clean coal
technology.
Sec. 2212. Credit for production from a qualifying advanced clean coal
technology unit.

[[Page S10739]]

Subtitle C--Treatment of Persons Not Able To Use Entire Credit

Sec. 2221. Treatment of persons not able to use entire credit.

TITLE XXIII--OIL AND GAS PROVISIONS

Sec. 2301. Oil and gas from marginal wells.
Sec. 2302. Natural gas gathering lines treated as 7-year property.
Sec. 2303. Expensing of capital costs incurred in complying with
environmental protection agency sulfur regulations.
Sec. 2304. Environmental tax credit.
Sec. 2305. Determination of small refiner exception to oil depletion
deduction.
Sec. 2306. Marginal production income limit extension.
Sec. 2307. Amortization of geological and geophysical expenditures.
Sec. 2308. Amortization of delay rental payments.
Sec. 2309. Study of coal bed methane.
Sec. 2310. Extension and modification of credit for producing fuel from
a nonconventional source.
Sec. 2311. Natural gas distribution lines treated as 15-year property.

TITLE XXIV--ELECTRIC UTILITY RESTRUCTURING PROVISIONS

Sec. 2401. Ongoing study and reports regarding tax issues resulting
from future restructuring decisions.
Sec. 2402. Modifications to special rules for nuclear decommissioning
costs.
Sec. 2403. Treatment of certain income of cooperatives.
Sec. 2404. Sales or dispositions to implement Federal Energy Regulatory
Commission or State electric restructuring policy.
Sec. 2405. Application of temporary regulations to certain output
contracts.
Sec. 2406. Treatment of certain development income of cooperatives.

TITLE XXV--ADDITIONAL PROVISIONS

Sec. 2501. Extension of accelerated depreciation and wage credit
benefits on Indian reservations.
Sec. 2502. Study of effectiveness of certain provisions by GAO.
Sec. 2503. Credit for production of Alaska natural gas.
Sec. 2504. Sale of gasoline and diesel fuel at duty-free sales
enterprises.
Sec. 2505. Treatment of dairy property.
Sec. 2506. Clarification of excise tax exemptions for agricultural
aerial applicators.
Sec. 2507. Modification of rural airport definition.
Sec. 2508. Exemption from ticket taxes for transportation provided by
seaplanes.

DIVISION I--IRAQ OIL IMPORT RESTRICTION

TITLE XXVI--IRAQ OIL IMPORT RESTRICTION

Sec. 2601. Short title and findings.
Sec. 2602. Prohibition on Iraqi-origin petroleum imports.
Sec. 2603. Termination/Presidential certification.
Sec. 2604. Humanitarian interests.
Sec. 2605. Definitions.
Sec. 2606. Effective date.

DIVISION J--MISCELLANEOUS

TITLE XXVII--MISCELLANEOUS PROVISION

Sec. 2701. Fair treatment of Presidential judicial nominees.

DIVISION A--RELIABLE AND DIVERSE POWER GENERATION AND TRANSMISSION

TITLE I--REGIONAL COORDINATION

SEC. 101. POLICY ON REGIONAL COORDINATION.

(a) Statement of Policy.--It is the policy of the Federal
Government to encourage States to coordinate, on a regional
basis, State energy policies to provide reliable and
affordable energy services to the public while minimizing the
impact of providing energy services on communities and the
environment.
(b) Definition of Energy Services.--For purposes of this
section, the term ``energy services'' means--
(1) the generation or transmission of electric energy,
(2) the transportation, storage, and distribution of crude
oil, residual fuel oil, refined petroleum product, or natural
gas, or
(3) the reduction in load through increased efficiency,
conservation, or load control measures.

SEC. 102. FEDERAL SUPPORT FOR REGIONAL COORDINATION.

(a) Technical Assistance.--The Secretary of Energy shall
provide technical assistance to States and regional
organizations formed by two or more States to assist them in
coordinating their energy policies on a regional basis. Such
technical assistance may include assistance in--
(1) identifying the areas with the greatest energy resource
potential, and assessing future supply availability and
demand requirements,
(2) planning, coordinating, and siting additional energy
infrastructure, including generating facilities, electric
transmission facilities, pipelines, refineries, and
distributed generation facilities to maximize the efficiency
of energy resources and infrastructure and meet regional
needs with the minimum adverse impacts on the environment,
(3) identifying and resolving problems in distribution
networks,
(4) developing plans to respond to surge demand or
emergency needs, and
(5) developing renewable energy, energy efficiency,
conservation, and load control programs.
(b) Annual Conference on Regional Energy Coordination.--
(1) Annual conference.--The Secretary of Energy shall
convene an annual conference to promote regional coordination
on energy policy and infrastructure issues.
(2) Participation.--The Secretary of Energy shall invite
appropriate representatives of Federal, State, and regional
energy organizations, and other interested parties.
(3) State and federal agency cooperation.--The Secretary of
Energy shall consult and cooperate with State and regional
energy organizations, the Secretary of the Interior, the
Secretary of Agriculture, the Secretary of Commerce, the
Secretary of the Treasury, the Chairman of the Federal Energy
Regulatory Commission, the Administrator of the Environmental
Protection Agency, and the Chairman of the Council on
Environmental Quality in the planning and conduct of the
conference.
(4) Agenda.--The Secretary of Energy, in consultation with
the officials identified in paragraph (3) and participants
identified in paragraph (2), shall establish an agenda for
each conference that promotes regional coordination on energy
policy and infrastructure issues.
(5) Recommendations.--Not later than 60 days after the
conclusion of each annual conference, the Secretary of Energy
shall report to the President and the Congress
recommendations arising out of the conference that may
improve--
(A) regional coordination on energy policy and
infrastructure issues, and
(B) Federal support for regional coordination.

TITLE II--ELECTRICITY

Subtitle A--Amendments to the Federal Power Act

SEC. 201. DEFINITIONS.

(a) Definition of Electric Utility.--Section 3(22) of the
Federal Power Act (16 U.S.C. 796(22)) is amended to read as
follows:
``(22) `electric utility' means any person or Federal or
State agency (including any municipality) that sells electric
energy; such term includes the Tennessee Valley Authority and
each Federal power marketing agency.''.
(b) Definition of Transmitting Utility.--Section 3(23) of
the Federal Power Act (16 U.S.C. 796(23)) is amended to read
as follows:
``(23) Transmitting utility.--The term `transmitting
utility' means an entity (including any entity described in
section 201(f)) that owns or operates facilities used for the
transmission of electric energy in--
``(A) interstate commerce; or
``(B) for the sale of electric energy at wholesale.''.

SEC. 202. ELECTRIC UTILITY MERGERS.

Section 203(a) of the Federal Power Act (16 U.S.C. 824b) is
amended to read as follows:
``(a)(1) No public utility shall, without first having
secured an order of the Commission authorizing it to do so--
``(A) sell, lease, or otherwise dispose of the whole of its
facilities subject to the jurisdiction of the Commission, or
any part thereof of a value in excess of $10,000,000,
``(B) merge or consolidate, directly or indirectly, such
facilities or any part thereof with the facilities of any
other person, by any means whatsoever,
``(C) purchase, acquire, or take any security of any other
public utility, or
``(D) purchase, lease, or otherwise acquire existing
facilities for the generation of electric energy unless such
facilities will be used exclusively for the sale of electric
energy at retail.
``(2) No holding company in a holding company system that
includes a transmitting utility or an electric utility
company shall purchase, acquire, or take any security of, or,
by any means whatsoever, directly or indirectly, merge or
consolidate with a transmitting utility, an electric utility
company, a gas utility company, or a holding company in a
holding company system that includes a transmitting utility,
an electric utility company, or a gas utility company,
without first having secured an order of the Commission
authorizing it to do so.
``(3) Upon application for such approval the Commission
shall give reasonable notice in writing to the Governor and
State commission of each of the States in which the physical
property affected, or any part thereof, is situated, and to
such other persons as it may deem advisable.
``(4) After notice and opportunity for hearing, the
Commission shall approve the proposed disposition,
consolidation, acquisition, or control, if it finds that the
proposed transaction--
``(A) will be consistent with the public interest;
``(B) will not adversely affect the interests of consumers
of electric energy of any public utility that is a party to
the transaction or is an associate company of any party to
the transaction;
``(C) will not impair the ability of the Commission or any
State commission having jurisdiction over any public utility
that is a party to the transaction or an associate company of
any party to the transaction to protect the interests of
consumers or the public; and
``(D) will not lead to cross-subsidization of associate
companies or encumber any utility assets for the benefit of
an associate company.
``(5) The Commission shall, by rule, adopt procedures for
the expeditious consideration of applications for the
approval of dispositions, consolidations, or acquisitions
under this section. Such rules shall identify classes of
transactions, or specify criteria for transactions, that
normally meet the standards established in paragraph (4), and
shall require the Commission to grant or deny an application
for approval of a transaction of such type within 90 days
after the conclusion of the hearing or opportunity to comment
under paragraph (4). If the Commission does not act within 90
days, such application shall be deemed granted unless the
Commission finds that further consideration is required

[[Page S10740]]

to determine whether the proposed transaction meets the
standards of paragraph (4) and issues one or more orders
tolling the time for acting on the application for an
additional 90 days.
``(6) For purposes of this subsection, the terms `associate
company', `electric utility company', `gas utility company',
`holding company', and `holding company system' have the
meaning given those terms in the Public Utility Holding
Company Act of 2003.''.

SEC. 203. MARKET-BASED RATES.

(a) Approval of Market-Based Rates.--Section 205 of the
Federal Power Act (16 U.S.C. 824d) is amended by adding at
the end the following:
``(h) The Commission may determine whether a market-based
rate for the sale of electric energy subject to the
jurisdiction of the Commission is just and reasonable and not
unduly discriminatory or preferential. In making such
determination, the Commission shall consider such factors as
the Commission may deem to be appropriate and in the public
interest, including to the extent the Commission considers
relevant to the wholesale power market--
``(1) market power;
``(2) the nature of the market and its response mechanisms;
and
``(3) reserve margins.''.
(b) Revocation of Market-Based Rates.--Section 206 of the
Federal Power Act (16 U.S.C. 824e) is amended by adding at
the end the following:
``(f) Whenever the Commission, after a hearing had upon its
own motion or upon complaint, finds that a rate charged by a
public utility authorized to charge a market-based rate under
section 205 is unjust, unreasonable, unduly discriminatory or
preferential, the Commission shall determine the just and
reasonable rate and fix the same by order.''.

SEC. 204. REFUND EFFECTIVE DATE.

Section 206(b) of the Federal Power Act (16 U.S.C. 824e(b))
is amended by--
(1) striking ``the date 60 days after the filing of such
complaint nor later than 5 months after the expiration of
such 60-day period'' in the second sentence and inserting
``the date of the filing of such complaint nor later than 5
months after the filing of such complaint'';
(2) striking ``60 days after'' in the third sentence and
inserting ``of''; and
(3) striking ``expiration of such 60-day period'' in the
third sentence and inserting ``publication date''.

SEC. 205. OPEN ACCESS TRANSMISSION BY CERTAIN UTILITIES.

Part II of the Federal Power Act is further amended by
inserting after section 211 the following:

``open access by unregulated transmitting utilities

``Sec. 211A. (a) Subject to section 212(h), the Commission
may, by rule or order, require an unregulated transmitting
utility to provide transmission services--
``(1) at rates that are comparable to those that the
unregulated transmitting utility charges itself, and
``(2) on terms and conditions (not relating to rates) that
are comparable to those under Commission rules that require
public utilities to offer open access transmission services
and that are not unduly discriminatory or preferential.
``(b) The Commission shall exempt from any rule or order
under this subsection any unregulated transmitting utility
that--
``(1) sells no more than 4,000,000 megawatt hours of
electricity per year;
``(2) does not own or operate any transmission facilities
that are necessary for operating an interconnected
transmission system (or any portion thereof); or
``(3) meets other criteria the Commission determines to be
in the public interest.
``(c) The rate changing procedures applicable to public
utilities under subsections (c) and (d) of section 205 are
applicable to unregulated transmitting utilities for purposes
of this section.
``(d) In exercising its authority under paragraph (1), the
Commission may remand transmission rates to an unregulated
transmitting utility for review and revision where necessary
to meet the requirements of subsection (a).
``(e) The provision of transmission services under
subsection (a) does not preclude a request for transmission
services under section 211.
``(f) The Commission may not require a State or
municipality to take action under this section that
constitutes a private business use for purposes of section
141 of the Internal Revenue Code of 1986 (26 U.S.C. 141).
``(g) For purposes of this subsection, the term
`unregulated transmitting utility' means an entity that--
``(1) owns or operates facilities used for the transmission
of electric energy in interstate commerce, and
``(2) is either an entity described in section 201(f) or a
rural electric cooperative.''.

SEC. 206. ELECTRIC RELIABILITY STANDARDS.

Part II of the Federal Power Act (16 U.S.C. 824 et seq.) is
amended by inserting the following after section 215 as added
by this Act:

``SEC. 216. ELECTRIC RELIABILITY.

``(a) Definitions.--For purposes of this section--
``(1) `bulk-power system' means the network of
interconnected transmission facilities and generating
facilities;
``(2) `electric reliability organization' means a self-
regulating organization certified by the Commission under
subsection (c) whose purpose is to promote the reliability of
the bulk-power system; and
``(3) `reliability standard' means a requirement to provide
for reliable operation of the bulk-power system approved by
the Commission under this section.
``(b) Jurisidiction and Applicability.--The Commission
shall have jurisdiction, within the United States, over an
electric reliability organization, any regional entities, and
all users, owners and operators of the bulk-power system,
including but not limited to the entities described in
section 201(f), for purposes of approving reliability
standards and enforcing compliance with this section. All
users, owners and operators of the bulk-power system shall
comply with reliability standards that take effect under this
section.
``(c) Certification.--(1) The Commission shall issue a
final rule to implement the requirements of this section not
later than 180 days after the date of enactment of this
section.
``(2) Following the issuance of a Commission rule under
paragraph (1), any person may submit an application to the
Commission for certification as an electric reliability
organization. The Commission may certify an applicant if the
Commission determines that the applicant--
``(A) has the ability to develop, and enforce reliability
standards that provide for an adequate level of reliability
of the bulk-power system;
``(B) has established rules that--
``(i) assure its independence of the users and owners and
operators of the bulk-power system; while assuring fair
stakeholder representation in the selection of its directors
and balanced decisionmaking in any committee or subordinate
organizational structure;
``(ii) allocate equitably dues, fees, and other charges
among end users for all activities under this section;
``(iii) provide fair and impartial procedures for
enforcement of reliability standards through imposition of
penalties (including limitations on activities, functions, or
operations, or other appropriate sanctions); and
``(iv) provide for reasonable notice and opportunity for
public comment, due process, openness, and balance of
interests in developing reliability standards and otherwise
exercising its duties.
``(3) If the Commission receives two or more timely
applications that satisfy the requirements of this
subsection, the Commission shall approve only the application
it concludes will best implement the provisions of this
section.
``(d) Reliability Standards.--(1) An electric reliability
organization shall file a proposed reliability standard or
modification to a reliability standard with the Commission.
``(2) The Commission may approve a proposed reliability
standard or modification to a reliability standard if it
determines that the standard is just, reasonable, not unduly
discriminatory or preferential, and in the public interest.
The Commission shall give due weight to the technical
expertise of the electric reliability organization with
respect to the content of a proposed standard or modification
to a reliability standard, but shall not defer with respect
to its effect on competition.
``(3) The electric reliability organization and the
Commission shall rebuttably presume that a proposal from a
regional entity organized on an interconnection-wide basis
for a reliability standard or modification to a reliability
standard to be applicable on an interconnection-wide basis is
just, reasonable, and not unduly discriminatory or
preferential, and in the public interest.
``(4) The Commission shall remand to the electric
reliability organization for further consideration a proposed
reliability standard or a modification to a reliability
standard that the Commission disapproves in whole or in part.
``(5) The Commission, upon its own motion or upon
complaint, may order an electric reliability organization to
submit to the Commission a proposed reliability standard or a
modification to a reliability standard that addresses a
specific matter if the Commission considers such a new or
modified reliability standard appropriate to carry out this
section.
``(e) Enforcement.--(1) An electric reliability
organization may impose a penalty on a user or owner or
operator of the bulk-power system if the electric reliability
organization, after notice and an opportunity for a hearing--
``(A) finds that the user or owner or operator of the bulk-
power system has violated a reliability standard approved by
the Commission under subsection (d); and
``(B) files notice with the Commission, which shall affirm,
set aside or modify the action.
``(2) On its own motion or upon complaint, the Commission
may order compliance with a reliability standard and may
impose a penalty against a user or owner or operator of the
bulk-power system, if the Commission finds, after notice and
opportunity for a hearing, that the user or owner or operator
of the bulk-power system has violated or threatens to violate
a reliability standard.
``(3) The Commission shall establish regulations
authorizing the electric reliability organization to enter
into an agreement to delegate authority to a regional entity
for the purpose of proposing and enforcing reliability
standards (including related activities) if the regional
entity satisfies the provisions of subsection (c)(2) (A) and
(B) and the agreement promotes effective and efficient
administration of bulk-power system reliability, and may
modify such delegation. The electric reliability organization
and the Commission shall rebuttably presume that a proposal
for delegation to a regional entity organized on an
interconnection-wide basis promotes effective and efficient
administration of bulk-power system reliability and should be
approved. Such regulation may provide that the Commission may
assign the electric reliability organization's authority to
enforce reliability standards directly to a regional entity
consistent with the requirements of this paragraph.
``(4) The Commission may take such action as is necessary
or appropriate against the electric reliability organization
or a regional entity to

[[Page S10741]]

ensure compliance with a reliability standard or any
Commission order affecting the electric reliability
organization or a regional entity.
``(f) Changes in Electricity Relialb1lity Organization
Rules.--An electric reliability organization shall file with
the Commission for approval any proposed rule or proposed
rule change, accompanied by an explanation of its basis and
purpose. The Commission, upon its own motion or complaint,
may propose a change to the rules of the electric reliability
organization. A proposed rule or proposed rule change shall
take effect upon a finding by the Commission, after notice
and opportunity for comment, that the change is just,
reasonable, not unduly discriminatory or preferential, is in
the public interest, and satisfies the requirements of
subsection (c)(2).
``(g) Coordination With Canada and Mexico.--(1) The
electric reliability organization shall take all appropriate
steps to gain recognition in Canada and Mexico.
``(2) The President shall use his best efforts to enter
into international agreements with the governments of Canada
and Mexico to provide for effective compliance with
reliability standards and the effectiveness of the electric
reliability organization in the United States and Canada or
Mexico.
``(h) Reliability Reports.--The electric reliability
organization shall conduct periodic assessments of the
reliability and adequacy of the interconnected bulk-power
system in North America.
``(i) Savings Provisions.--(1) The electric reliability
organization shall have authority to develop and enforce
compliance with standards for the reliable operation of only
the bulk-power system.
``(2) This section does not provide the electric
reliability organization or the Commission with the authority
to order the construction of additional generation or
transmission capacity or to set and enforce compliance with
standards for adequacy or safety of electric facilities or
services.
``(3) Nothing in this section shall be construed to preempt
any authority of any State to take action to ensure the
safety, adequacy, and reliability of electric service within
that State, as long as such action is not inconsistent with
any reliability standard.
``(4) Within 90 days of the application of the electric
reliability organization or other affected party, and after
notice and opportunity for comment, the Commission shall
issue a final order determining whether a State action is
inconsistent with a reliability standard, taking into
consideration any recommendation of the electric reliability
organization.
``(5) The Commission, after consultation with the electric
reliability organization, may stay the effectiveness of any
State action, pending the Commission's issuance of a final
order.
``(j) Application of Antitrust Laws.--
``(1) In general.--To the extent undertaken to develop,
implement, or enforce a reliability standard, each of the
following activities shall not, in any action under the
antitrust laws, be deemed illegal per se--
``(A) activities undertaken by an electric reliability
organization under this section, and
``(B) activities of a user or owner or operator of the
bulk-power system undertaken in good faith under the rules of
an electric reliability organization.
``(2) Rule of Reason.--In any action under the antitrust
laws, an activity described in paragraph (1) shall be judged
on the basis of its reasonableness, taking into account all
relevant factors affecting competition and reliability.
``(3) Definition.--For purposes of this subsection,
`antitrust laws' has the meaning given the term in subsection
(a) of the first section of the Clayton Act (15 U.S.C.
12(a)), except that it includes section 5 of the Federal
Trade Commission Act (15 U. S.C. 45) to the extent that
section 5 applies to unfair methods of competition.
``(k) Regional Advisory Bodies.--The Commission shall
establish a regional advisory body on the petition of at
least two-thirds of the States within a region that have more
than one-half of their electric load served within the
region. A regional advisory body shall be composed of one
member from each participating State in the region, appointed
by the Governor of each State, and may include
representatives of agencies, States, and provinces outside
the United States. A regional advisory body may provide
advice to the electric reliability organization, a regional
reliability entity, or the Commission regarding the
governance of an existing or proposed regional reliability
entity within the same region, whether a standard proposed to
apply within the region is just, reasonable, not unduly
discriminatory or preferential, and in the public interest,
whether fees proposed to be assessed within the region are
just, reasonable, not unduly discriminatory or preferential,
and in the public interest and any other responsibilities
requested by the Commission. The Commission may give
deference to the advice of any such regional advisory body if
that body is organized on an interconnection-wide basis.
``(l) Application to Alaska and Hawaii.--The provisions of
this section do not apply to Alaska or Hawaii.''.

SEC. 207. MARKET TRANSPARENCY RULES.

Part II of the Federal Power Act is further amended by
adding at the end the following:

``SEC. 216. MARKET TRANSPARENCY RULES.

``(a) Commission Rules.--Not later than 180 days after the
date of enactment of this section, the Commission shall issue
rules establishing an electronic information system to
provide information about the availability and price of
wholesale electric energy and transmission services to the
Commission, State commissions, buyers and sellers of
wholesale electric energy, users of transmission services,
and the public on a timely basis.
``(b) Information Required.--The Commission shall require--
``(1) each regional transmission organization to provide
statistical information about the available capacity and
capacity constraints of transmission facilities operated by
the organization; and
``(2) each broker, exchange, or other market-making entity
that matches offers to sell and offers to buy wholesale
electric energy in interstate commerce to provide statistical
information about the amount and sale price of sales of
electric energy at wholesale in interstate commerce it
transacts.
``(c) Timely Basis.--The Commission shall require the
information required under subsection (b) to be posted on the
Internet as soon as practicable and updated as frequently as
practicable.
``(d) Protection of Sensitive Information.--The Commission
shall exempt from disclosure commercial or financial
information that the Commission, by rule or order, determines
to be privileged, confidential, or otherwise sensitive.''.

SEC. 208. ACCESS TO TRANSMISSION BY INTERMITTENT GENERATORS.

Part II of the Federal Power Act is further amended by
adding at the end the following:

``SEC. 217. ACCESS TO TRANSMISSION BY INTERMITTENT
GENERATORS.

``(a) Fair Treatment of Intermittent Generators.--The
Commission shall ensure that all transmitting utilities
provide transmission service to intermittent generators in a
manner that does not unduly prejudice or disadvantage such
generators for characteristics that are--
``(1) inherent to intermittent energy resources; and
``(2) are beyond the control of such generators.
``(b) Policies.--The Commission shall ensure that the
requirement in subsection (a) is met by adopting such
policies as it deems appropriate which shall include the
following:
``(1) Subject to the sole exception set forth in paragraph
(2), the Commission shall ensure that the rates transmitting
utilities charge intermittent generator customers for
transmission services do not unduly prejudice or disadvantage
intermittent generator customers for scheduling deviations.
``(2) The Commission may exempt a transmitting utility from
the requirement set forth in paragraph (1) if the
transmitting utility demonstrates that scheduling deviations
by its intermittent generator customers are likely to have an
adverse impact on the reliability of the transmitting
utility's system.
``(3) The Commission shall ensure that to the extent any
transmission charges recovering the transmitting utility's
embedded costs are assessed to such intermittent generators,
they are assessed to such generators on the basis of
kilowatt-hours generated or some other method to ensure that
they are fully recovered by the transmitting utility.
``(4) The Commission shall require transmitting utilities
to offer to intermittent generators, and may require
transmitting utilities to offer to all transmission
customers, access to nonfirm transmission service.
``(c) Definitions.--As used in this section:
``(1) The term `intermittent generator' means a facility
that generates electricity using wind or solar energy and no
other energy source.
``(2) The term `nonfirm transmission service' means
transmission service provided on an `as available' basis.
``(3) The term `scheduling deviation' means delivery of
more or less energy than has previously been forecast in a
schedule submitted by an intermittent generator to a control
area operator or transmitting utility.''.

SEC. 209. ENFORCEMENT.

(a) Complaints.--Section 306 of the Federal Power Act (16
U.S.C. 825e) is amended by--
(1) inserting ``electric utility,'' after ``Any person,'';
and
(2) inserting ``transmitting utility,'' after ``licensee''
each place it appears.
(b) Investigations.--Section 307(a) of the Federal Power
Act (16 U.S.C. 825f(a)) is amended by inserting ``or
transmitting utility'' after ``any person'' in the first
sentence.
(c) Review of Commission Orders.--Section 313(a) of the
Federal Power Act (16 U.S.C. 8251) is amended by inserting
``electric utility,'' after ``Any person,'' in the first
sentence.
(d) Criminal Penalties.--Section 316(c) of the Federal
Power Act (16 U.S.C. 825o(c)) is repealed.
(e) Civil Penalties.--Section 316A of the Federal Power Act
(16 U.S.C. 825o-1) is amended by striking ``section 211, 212,
213, or 214'' each place it appears and inserting ``Part
II''.

SEC. 210. ELECTRIC POWER TRANSMISSION SYSTEMS.

The Federal Government should be attentive to electric
power transmission issues, including issues that can be
addressed through policies that facilitate investment in, the
enhancement of, and the efficiency of electric power
transmission systems.

Subtitle B--Amendments to the Public Utility Holding Company Act

SEC. 221. SHORT TITLE.

This subtitle may be cited as the ``Public Utility Holding
Company Act of 2003''.

SEC. 222. DEFINITIONS.

For purposes of this subtitle:
(1) The term ``affiliate'' of a company means any company,
5 percent or more of the outstanding voting securities of
which are owned, controlled, or held with power to vote,
directly or indirectly, by such company.
(2) The term ``associate company'' of a company means any
company in the same holding company system with such company.
(3) The term ``Commission'' means the Federal Energy
Regulatory Commission.

[[Page S10742]]

(4) The term ``company'' means a corporation, partnership,
association, joint stock company, business trust, or any
organized group of persons, whether incorporated or not, or a
receiver, trustee, or other liquidating agent of any of the
foregoing.
(5) The term ``electric utility company'' means any company
that owns or operates facilities used for the generation,
transmission, or distribution of electric energy for sale.
(6) The terms ``exempt wholesale generator'' and ``foreign
utility company'' have the same meanings as in sections 32
and 33, respectively, of the Public Utility Holding Company
Act of 1935 (15 U.S.C. 79z-5a, 79z-5b), as those sections
existed on the day before the effective date of this
subtitle.
(7) The term ``gas utility company'' means any company that
owns or operates facilities used for distribution at retail
(other than the distribution only in enclosed portable
containers or distribution to tenants or employees of the
company operating such facilities for their own use and not
for resale) of natural or manufactured gas for heat, light,
or power.
(8) The term ``holding company'' means--
(A) any company that directly or indirectly owns, controls,
or holds, with power to vote, 10 percent or more of the
outstanding voting securities of a public utility company or
of a holding company of any public utility company; and
(B) any person, determined by the Commission, after notice
and opportunity for hearing, to exercise directly or
indirectly (either alone or pursuant to an arrangement or
understanding with one or more persons) such a controlling
influence over the management or policies of any public
utility company or holding company as to make it necessary or
appropriate for the rate protection of utility customers with
respect to rates that such person be subject to the
obligations, duties, and liabilities imposed by this subtitle
upon holding companies.
(9) The term ``holding company system'' means a holding
company, together with its subsidiary companies.
(10) The term ``jurisdictional rates'' means rates
established by the Commission for the transmission of
electric energy in interstate commerce, the sale of electric
energy at wholesale in interstate commerce, the
transportation of natural gas in interstate commerce, and the
sale in interstate commerce of natural gas for resale for
ultimate public consumption for domestic, commercial,
industrial, or any other use.
(11) The term ``natural gas company'' means a person
engaged in the transportation of natural gas in interstate
commerce or the sale of such gas in interstate commerce for
resale.
(12) The term ``person'' means an individual or company.
(13) The term ``public utility'' means any person who owns
or operates facilities used for transmission of electric
energy in interstate commerce or sales of electric energy at
wholesale in interstate commerce.
(14) The term ``public utility company'' means an electric
utility company or a gas utility company.
(15) The term ``State commission'' means any commission,
board, agency, or officer, by whatever name designated, of a
State, municipality, or other political subdivision of a
State that, under the laws of such State, has jurisdiction to
regulate public utility companies.
(16) The term ``subsidiary company'' of a holding company
means--
(A) any company, 10 percent or more of the outstanding
voting securities of which are directly or indirectly owned,
controlled, or held with power to vote, by such holding
company; and
(B) any person, the management or policies of which the
Commission, after notice and opportunity for hearing,
determines to be subject to a controlling influence, directly
or indirectly, by such holding company (either alone or
pursuant to an arrangement or understanding with one or more
other persons) so as to make it necessary for the rate
protection of utility customers with respect to rates that
such person be subject to the obligations, duties, and
liabilities imposed by this subtitle upon subsidiary
companies of holding companies.
(17) The term ``voting security'' means any security
presently entitling the owner or holder thereof to vote in
the direction or management of the affairs of a company.

SEC. 223. REPEAL OF THE PUBLIC UTILITY HOLDING COMPANY ACT OF
1935.

The Public Utility Holding Company Act of 1935 (15 U.S.C.
79 et seq.) is repealed.

SEC. 224. FEDERAL ACCESS TO BOOKS AND RECORDS.

(a) In General.--Each holding company and each associate
company thereof shall maintain, and shall make available to
the Commission, such books, accounts, memoranda, and other
records as the Commission deems to be relevant to costs
incurred by a public utility or natural gas company that is
an associate company of such holding company and necessary or
appropriate for the protection of utility customers with
respect to jurisdictional rates.
(b) Affiliate Companies.--Each affiliate of a holding
company or of any subsidiary company of a holding company
shall maintain, and shall make available to the Commission,
such books, accounts, memoranda, and other records with
respect to any transaction with another affiliate, as the
Commission deems to be relevant to costs incurred by a public
utility or natural gas company that is an associate company
of such holding company and necessary or appropriate for the
protection of utility customers with respect to
jurisdictional rates.
(c) Holding Company Systems.--The Commission may examine
the books, accounts, memoranda, and other records of any
company in a holding company system, or any affiliate
thereof, as the Commission deems to be relevant to costs
incurred by a public utility or natural gas company within
such holding company system and necessary or appropriate for
the protection of utility customers with respect to
jurisdictional rates.
(d) Confidentiality.--No member, officer, or employee of
the Commission shall divulge any fact or information that may
come to his or her knowledge during the course of examination
of books, accounts, memoranda, or other records as provided
in this section, except as may be directed by the Commission
or by a court of competent jurisdiction.

SEC. 225. STATE ACCESS TO BOOKS AND RECORDS.

(a) In General.--Upon the written request of a State
commission having jurisdiction to regulate a public utility
company in a holding company system, the holding company or
any associate company or affiliate thereof, other than such
public utility company, wherever located, shall produce for
inspection books, accounts, memoranda, and other records
that--
(1) have been identified in reasonable detail by the State
commission;
(2) the State commission deems are relevant to costs
incurred by such public utility company; and
(3) are necessary for the effective discharge of the
responsibilities of the State commission with respect to such
proceeding.
(b) Limitation.--Subsection (a) does not apply to any
person that is a holding company solely by reason of
ownership of one or more qualifying facilities under the
Public Utility Regulatory Policies Act of 1978 (16 U.S.C.
2601 et seq.).
(c) Confidentiality of Information.--The production of
books, accounts, memoranda, and other records under
subsection (a) shall be subject to such terms and conditions
as may be necessary and appropriate to safeguard against
unwarranted disclosure to the public of any trade secrets or
sensitive commercial information.
(d) Effect on State Law.--Nothing in this section shall
preempt applicable State law concerning the provision of
books, accounts, memoranda, and other records, or in any way
limit the rights of any State to obtain books, accounts,
memoranda, and other records under any other Federal law,
contract, or otherwise.
(e) Court Jurisdiction.--Any United States district court
located in the State in which the State commission referred
to in subsection (a) is located shall have jurisdiction to
enforce compliance with this section.

SEC. 226. EXEMPTION AUTHORITY.

(a) Rulemaking.--Not later than 90 days after the effective
date of this subtitle, the Commission shall promulgate a
final rule to exempt from the requirements of section 224 any
person that is a holding company, solely with respect to one
or more--
(1) qualifying facilities under the Public Utility
Regulatory Policies Act of 1978 (16 U.S.C. 2601 et seq.);
(2) exempt wholesale generators; or
(3) foreign utility companies.
(b) Other Authority.--The Commission shall exempt a person
or transaction from the requirements of section 224, if, upon
application or upon the motion of the Commission--
(1) the Commission finds that the books, accounts,
memoranda, and other records of any person are not relevant
to the jurisdictional rates of a public utility or natural
gas company; or
(2) the Commission finds that any class of transactions is
not relevant to the jurisdictional rates of a public utility
or natural gas company.

SEC. 227. AFFILIATE TRANSACTIONS.

(a) Commission Authority Unaffected.--Nothing in this
subtitle shall limit the authority of the Commission under
the Federal Power Act (16 U.S.C. 791a et seq.) to require
that jurisdictional rates are just and reasonable, including
the ability to deny or approve the pass through of costs, the
prevention of cross-subsidization, and the promulgation of
such rules and regulations as are necessary or appropriate
for the protection of utility consumers.
(b) Recovery of Costs.--Nothing in this subtitle shall
preclude the Commission or a State commission from exercising
its jurisdiction under otherwise applicable law to determine
whether a public utility company, public utility, or natural
gas company may recover in rates any costs of an activity
performed by an associate company, or any costs of goods or
services acquired by such public utility company from an
associate company.

SEC. 228. APPLICABILITY.

Except as otherwise specifically provided in this subtitle,
no provision of this subtitle shall apply to, or be deemed to
include--
(1) the United States;
(2) a State or any political subdivision of a State;
(3) any foreign governmental authority not operating in the
United States;
(4) any agency, authority, or instrumentality of any entity
referred to in paragraph (1), (2), or (3); or
(5) any officer, agent, or employee of any entity referred
to in paragraph (1), (2), or (3) acting as such in the course
of his or her official duty.

SEC. 229. EFFECT ON OTHER REGULATIONS.

Nothing in this subtitle precludes the Commission or a
State commission from exercising its jurisdiction under
otherwise applicable law to protect utility customers.

SEC. 230. ENFORCEMENT.

The Commission shall have the same powers as set forth in
sections 306 through 317 of the Federal Power Act (16 U.S.C.
825e-825p) to enforce the provisions of this subtitle.

SEC. 231. SAVINGS PROVISIONS.

(a) In General.--Nothing in this subtitle prohibits a
person from engaging in or continuing to engage in activities
or transactions in which

[[Page S10743]]

it is legally engaged or authorized to engage on the
effective date of this subtitle.
(b) Effect on Other Commission Authority.--Nothing in this
subtitle limits the authority of the Commission under the
Federal Power Act (16 U.S.C. 791a et seq.) (including section
301 of that Act) or the Natural Gas Act (15 U.S.C. 717 et
seq.) (including section 8 of that Act).

SEC. 232. IMPLEMENTATION.

Not later than 18 months after the date of enactment of
this subtitle, the Commission shall--
(1) promulgate such regulations as may be necessary or
appropriate to implement this subtitle (other than section
225); and
(2) submit to the Congress detailed recommendations on
technical and conforming amendments to Federal law necessary
to carry out this subtitle and the amendments made by this
subtitle.

SEC. 233. TRANSFER OF RESOURCES.

All books and records that relate primarily to the
functions transferred to the Commission under this subtitle
shall be transferred from the Securities and Exchange
Commission to the Commission.

SEC. 234. INTER-AGENCY REVIEW OF COMPETITION IN THE WHOLESALE
AND RETAIL MARKETS FOR ELECTRIC ENERGY.

(a) Task Force.--There is established an inter-agency task
force, to be known as the ``Electric Energy Market
Competition Task Force'' (referred to in this section as the
``task force''), which shall consist of--
(1) one member each from--
(A) the Department of Justice, to be appointed by the
Attorney General of the United States;
(B) the Federal Energy Regulatory Commission, to be
appointed by the chairman of that Commission; and
(C) the Federal Trade Commission, to be appointed by the
chairman of that Commission; and
(2) two advisory members (who shall not vote), of whom--
(A) one shall be appointed by the Secretary of Agriculture
to represent the Rural Utility Service; and
(B) one shall be appointed by the Chairman of the
Securities and Exchange Commission to represent that
Commission.
(b) Study and Report.--
(1) Study.--The task force shall perform a study and
analysis of the protection and promotion of competition
within the wholesale and retail market for electric energy in
the United States.
(2) Report.--
(A) Final report.--Not later than 1 year after the
effective date of this subtitle, the task force shall submit
a final report of its findings under paragraph (1) to the
Congress.
(B) Public comment.--At least 60 days before submission of
a final report to the Congress under subparagraph (A), the
task force shall publish a draft report in the Federal
Register to provide for public comment.
(c) Focus.--The study required by this section shall
examine--
(1) the best means of protecting competition within the
wholesale and retail electric market;
(2) activities within the wholesale and retail electric
market that may allow unfair and unjustified discriminatory
and deceptive practices;
(3) activities within the wholesale and retail electric
market, including mergers and acquisitions, that deny market
access or suppress competition;
(4) cross-subsidization that may occur between regulated
and nonregulated activities; and
(5) the role of State public utility commissions in
regulating competition in the wholesale and retail electric
market.
(d) Consultation.--In performing the study required by this
section, the task force shall consult with and solicit
comments from its advisory members, the States,
representatives of the electric power industry, and the
public.

SEC. 235. GAO STUDY ON IMPLEMENTATION.

(a) Study.--The Comptroller General shall conduct a study
of the success of the Federal Government and the States
during the 18-month period following the effective date of
this subtitle in--
(1) the prevention of anticompetitive practices and other
abuses by public utility holding companies, including cross-
subsidization and other market power abuses; and
(2) the promotion of competition and efficient energy
markets to the benefit of consumers.
(b) Report to Congress.--Not earlier than 18 months after
the effective date of this subtitle or later than 24 months
after that effective date, the Comptroller General shall
submit a report to the Congress on the results of the study
conducted under subsection (a), including probable causes of
its findings and recommendations to the Congress and the
States for any necessary legislative changes.

SEC. 236. EFFECTIVE DATE.

This subtitle shall take effect 18 months after the date of
enactment of this subtitle.

SEC. 237. AUTHORIZATION OF APPROPRIATIONS.

There are authorized to be appropriated such funds as may
be necessary to carry out this subtitle.

SEC. 238. CONFORMING AMENDMENTS TO THE FEDERAL POWER ACT.

(a) Conflict of Jurisdiction.--Section 318 of the Federal
Power Act (16 U.S.C. 825q) is repealed.
(b) Definitions.--(1) Section 201(g) of the Federal Power
Act (16 U.S.C. 824(g)) is amended by striking ``1935'' and
inserting ``2002''.
(2) Section 214 of the Federal Power Act (16 U.S.C. 824m)
is amended by striking ``1935'' and inserting ``2002''.

Subtitle C--Amendments to the Public Utility Regulatory Policies Act of
1978

SEC. 241. REAL-TIME PRICING AND TIME-OF-USE METERING
STANDARDS.

(a) Adoption of Standards.--Section 111(d) of the Public
Utility Regulatory Policies Act of 1978 (16 U.S.C. 2621(d))
is amended by adding at the end the following:
``(11) Real-time pricing.--(A) Each electric utility shall,
at the request of an electric consumer, provide electric
service under a real-time rate schedule, under which the rate
charged by the electric utility varies by the hour (or
smaller time interval) according to changes in the electric
utility's wholesale power cost. The real-time pricing service
shall enable the electric consumer to manage energy use and
cost through real-time metering and communications
technology.
``(B) For purposes of implementing this paragraph, any
reference contained in this section to the date of enactment
of the Public Utility Regulatory Policies Act of 1978 shall
be deemed to be a reference to the date of enactment of this
paragraph.
``(C) Notwithstanding subsections (b) and (c) of section
112, each State regulatory authority shall consider and make
a determination concerning whether it is appropriate to
implement the standard set out in subparagraph (A) not later
than 1 year after the date of enactment of this paragraph.
``(12) Time-of-use metering.--(A) Each electric utility
shall, at the request of an electric consumer, provide
electric service under a time-of-use rate schedule which
enables the electric consumer to manage energy use and cost
through time-of-use metering and technology.
``(B) For purposes of implementing this paragraph, any
reference contained in this section to the date of enactment
of the Public Utility Regulatory Policies Act of 1978 shall
be deemed to be a reference to the date of enactment of this
paragraph.
``(C) Notwithstanding subsections (b) and (c) of section
112, each State regulatory authority shall consider and make
a determination concerning whether it is appropriate to
implement the standards set out in subparagraph (A) not later
than 1 year after the date of enactment of this paragraph.''.
(b) Special Rules.--Section 115 of the Public Utility
Regulatory Policies Act of 1978 (16 U.S.C. 2625) is amended
by adding at the end the following:
``(i) Real-Time Pricing.--In a State that permits third-
party marketers to sell electric energy to retail electric
consumers, the electric consumer shall be entitled to receive
the same real-time metering and communication service as a
direct retail electric consumer of the electric utility.
``(j) Time-of-Use Metering.--In a State that permits third-
party marketers to sell electric energy to retail electric
consumers, the electric consumer shall be entitled to receive
the same time-of-use metering and communication service as a
direct retail electric consumer of the electric utility.''.

SEC. 242. ADOPTION OF ADDITIONAL STANDARDS.

(a) Adoption of Standards.--Section 113(b) of the Public
Utility Regulatory Policies Act of 1978 (16 U.S.C. 2623(b))
is amended by adding at the end the following:
``(6) Distributed generation.--Each electric utility shall
provide distributed generation, combined heat and power, and
district heating and cooling systems competitive access to
the local distribution grid and competitive pricing of
service, and shall use simplified standard contracts for the
interconnection of generating facilities that have a power
production capacity of 250 kilowatts or less.
``(7) Distribution interconnections.--No electric utility
may refuse to interconnect a generating facility with the
distribution facilities of the electric utility if the owner
or operator of the generating facility complies with
technical standards adopted by the State regulatory authority
and agrees to pay the costs established by such State
regulatory authority.
``(8) Minimum fuel and technology diversity standard.--Each
electric utility shall develop a plan to minimize dependence
on one fuel source and to ensure that the electric energy it
sells to consumers is generated using a diverse range of
fuels and technologies, including renewable technologies.
``(9) Fossil fuel efficiency.--Each electric utility shall
develop and implement a ten-year plan to increase the
efficiency of its fossil fuel generation and shall monitor
and report to its State regulatory authority excessive
greenhouse gas emissions resulting from the inefficient
operation of its fossil fuel generating plants.''.
(b) Time for Adopting Standards.--Section 113 of the Public
Utility Regulatory Policies Act of 1978 (16 U.S.C. 2623) is
further amended by adding at the end the following:
``(d) Special Rule.--For purposes of implementing
paragraphs (6), (7), (8), and (9) of subsection (b), any
reference contained in this section to the date of enactment
of the Public Utility Regulatory Policies Act of 1978 shall
be deemed to be a reference to the date of enactment of this
subsection.''.

SEC. 243. TECHNICAL ASSISTANCE.

Section 132(c) of the Public Utility Regulatory Policies
Act of 1978 (16 U.S.C. 2642(c)) is amended to read as
follows:
``(c) Technical Assistance for Certain Responsibilities.--
The Secretary may provide such technical assistance as he
determines appropriate to assist State regulatory authorities
and electric utilities in carrying out their responsibilities
under section 111(d)(11) and paragraphs (6), (7), (8), and
(9) of section 113(b).''.

SEC. 244. COGENERATION AND SMALL POWER PRODUCTION PURCHASE
AND SALE REQUIREMENTS.

(a) Termination of Mandatory Purchase and Sale
Requirements.--Section 210 of the Public Utility Regulatory
Policies Act of 1978 (16

[[Page S10744]]

U.S.C. 824a-3) is amended by adding at the end the following:
``(m) Termination of Mandatory Purchase and Sale
Requirements.--
``(1) Obligation to purchase.-- After the date of enactment
of this subsection, no electric utility shall be required to
enter into a new contract or obligation to purchase electric
energy from a qualifying cogeneration facility or a
qualifying small power production facility under this section
if the Commission finds that the qualifying cogeneration
facility or qualifying small power production facility has
access to independently administered, auction-based day ahead
and real time wholesale markets for the sale of electric
energy.
``(2) Obligation to sell.--After the date of enactment of
this subsection, no electric utility shall be required to
enter into a new contract or obligation to sell electric
energy to a qualifying cogeneration facility or a qualifying
small power production facility under this section if
competing retail electric suppliers are able to provide
electric energy to the qualifying cogeneration facility or
qualifying small power production facility.
``(3) No effect on existing rights and remedies.--Nothing
in this subsection affects the rights or remedies of any
party under any contract or obligation, in effect on the date
of enactment of this subsection, to purchase electric energy
or capacity from or to sell electric energy or capacity to a
facility under this Act (including the right to recover costs
of purchasing electric energy or capacity).
``(4) Recovery of costs.--
``(A) Regulation.--To ensure recovery by an electric
utility that purchases electric energy or capacity from a
qualifying facility pursuant to any legally enforceable
obligation entered into or imposed under this section before
the date of enactment of this subsection, of all prudently
incurred costs associated with the purchases, the Commission
shall issue and enforce such regulations as may be required
to ensure that the electric utility shall collect the
prudently incurred costs associated with such purchases.
``(B) Enforcement.--A regulation under subparagraph (A)
shall be enforceable in accordance with the provisions of law
applicable to enforcement of regulations under the Federal
Power Act (16 U.S.C. 791a et seq.).''.
(b) Elimination of Ownership Limitations.--
(1) Section 3(17)(C) of the Federal Power Act (16 U.S.C.
796(17)(C)) is amended to read as follows:
``(C) `qualifying small power production facility' means a
small power production facility that the Commission
determines, by rule, meets such requirements (including
requirements respecting minimum size, fuel use, and fuel
efficiency) as the Commission may, by rule, prescribe.''.
(2) Section 3(18)(B) of the Federal Power Act (16 U.S.C.
796(18)(B)) is amended to read as follows:
``(B) `qualifying cogeneration facility' means a
cogeneration facility that the Commission determines, by
rule, meets such requirements (including requirements
respecting minimum size, fuel use, and fuel efficiency) as
the Commission may, by rule, prescribe.''.

SEC. 245. NET METERING.

(a) Adoption of Standard.--Section 111(d) of the Public
Utility Regulatory Policies Act of 1978 (16 U.S.C. 2621(d))
is further amended by adding at the end the following:
``(13) Net metering.--(A) Each electric utility shall make
available upon request net metering service to any electric
consumer that the electric utility serves.
``(B) For purposes of implementing this paragraph, any
reference contained in this section to the date of enactment
of the Public Utility Regulatory Policies Act of 1978 shall
be deemed to be a reference to the date of enactment of this
paragraph.
``(C) Notwithstanding subsections (b) and (c) of section
112, each State regulatory authority shall consider and make
a determination concerning whether it is appropriate to
implement the standard set out in subparagraph (A) not later
than 1 year after the date of enactment of this paragraph.''.
(b) Special Rules for Net Metering.--Section 115 of the
Public Utility Regulatory Policies Act of 1978 (16 U.S.C.
2625) is further amended by adding at the end the following:
``(k) Net Metering.--
``(1) Rates and charges.--An electric utility--
``(A) shall charge the owner or operator of an on-site
generating facility rates and charges that are identical to
those that would be charged other electric consumers of the
electric utility in the same rate class; and
``(B) shall not charge the owner or operator of an on-site
generating facility any additional standby, capacity,
interconnection, or other rate or charge.
``(2) Measurement.--An electric utility that sells electric
energy to the owner or operator of an on-site generating
facility shall measure the quantity of electric energy
produced by the on-site facility and the quantity of electric
energy consumed by the owner or operator of an on-site
generating facility during a billing period in accordance
with normal metering practices.
``(3) Electric energy supplied exceeding electric energy
generated.--If the quantity of electric energy sold by the
electric utility to an on-site generating facility exceeds
the quantity of electric energy supplied by the on-site
generating facility to the electric utility during the
billing period, the electric utility may bill the owner or
operator for the net quantity of electric energy sold, in
accordance with normal metering practices.
``(4) Electric energy generated exceeding electric energy
supplied.--If the quantity of electric energy supplied by the
on-site generating facility to the electric utility exceeds
the quantity of electric energy sold by the electric utility
to the on-site generating facility during the billing
period--
``(A) the electric utility may bill the owner or operator
of the on-site generating facility for the appropriate
charges for the billing period in accordance with paragraph
(2); and
``(B) the owner or operator of the on-site generating
facility shall be credited for the excess kilowatt-hours
generated during the billing period, with the kilowatt-hour
credit appearing on the bill for the following billing
period.
``(5) Safety and performance standards.--An eligible on-
site generating facility and net metering system used by an
electric consumer shall meet all applicable safety,
performance, reliability, and interconnection standards
established by the National Electrical Code, the Institute of
Electrical and Electronics Engineers, and Underwriters
Laboratories.
``(6) Additional control and testing requirements.--The
Commission, after consultation with State regulatory
authorities and nonregulated electric utilities and after
notice and opportunity for comment, may adopt, by rule,
additional control and testing requirements for on-site
generating facilities and net metering systems that the
Commission determines are necessary to protect public safety
and system reliability.
``(7) Definitions.--For purposes of this subsection:
``(A) The term `eligible on-site generating facility'
means--
``(i) a facility on the site of a residential electric
consumer with a maximum generating capacity of 10 kilowatts
or less that is fueled by solar energy, wind energy, or fuel
cells; or
``(ii) a facility on the site of a commercial electric
consumer with a maximum generating capacity of 500 kilowatts
or less that is fueled solely by a renewable energy resource,
landfill gas, or a high efficiency system.
``(B) The term `renewable energy resource' means solar,
wind, biomass, or geothermal energy.
``(C) The term `high efficiency system' means fuel cells or
combined heat and power.
``(D) The term `net metering service' means service to an
electric consumer under which electric energy generated by
that electric consumer from an eligible on-site generating
facility and delivered to the local distribution facilities
may be used to offset electric energy provided by the
electric utility to the electric consumer during the
applicable billing period.''.

Subtitle D--Consumer Protections

SEC. 251. INFORMATION DISCLOSURE.

(a) Offers and Solicitations.--The Federal Trade Commission
shall issue rules requiring each electric utility that makes
an offer to sell electric energy, or solicits electric
consumers to purchase electric energy to provide the electric
consumer a statement containing the following information--
(1) the nature of the service being offered, including
information about interruptibility of service;
(2) the price of the electric energy, including a
description of any variable charges;
(3) a description of all other charges associated with the
service being offered, including access charges, exit
charges, back-up service charges, stranded cost recovery
charges, and customer service charges; and
(4) information the Federal Trade Commission determines is
technologically and economically feasible to provide, is of
assistance to electric consumers in making purchasing
decisions, and concerns--
(A) the product or its price;
(B) the share of electric energy that is generated by each
fuel type; and
(C) the environmental emissions produced in generating the
electric energy.
(b) Periodic Billings.--The Federal Trade Commission shall
issue rules requiring any electric utility that sells
electric energy to transmit to each of its electric
consumers, in addition to the information transmitted
pursuant to section 115(f) of the Public Utility Regulatory
Policies Act of 1978 (16 U.S.C. 2625(f)), a clear and concise
statement containing the information described in subsection
(a)(4) for each billing period (unless such information is
not reasonably ascertainable by the electric utility).

SEC. 252. CONSUMER PRIVACY.

(a) Prohibition.--The Federal Trade Commission shall issue
rules prohibiting any electric utility that obtains consumer
information in connection with the sale or delivery of
electric energy to an electric consumer from using,
disclosing, or permitting access to such information unless
the electric consumer to whom such information relates
provides prior written approval.
(b) Permitted Use.--The rules issued under this section
shall not prohibit any electric utility from using,
disclosing, or permitting access to consumer information
referred to in subsection (a) for any of the following
purposes--
(1) to facilitate an electric consumer's change in
selection of an electric utility under procedures approved by
the State or State regulatory authority;
(2) to initiate, render, bill, or collect for the sale or
delivery of electric energy to electric consumers or for
related services;
(3) to protect the rights or property of the person
obtaining such information;
(4) to protect retail electric consumers from fraud, abuse,
and unlawful subscription in the sale or delivery of electric
energy to such consumers;
(5) for law enforcement purposes; or
(6) for purposes of compliance with any Federal, State, or
local law or regulation authorizing disclosure of information
to a Federal, State, or local agency.
(c) Aggregate Consumer Information.--The rules issued under
this subsection may permit a

[[Page S10745]]

person to use, disclose, and permit access to aggregate
consumer information and may require an electric utility to
make such information available to other electric utilities
upon request and payment of a reasonable fee.
(d) Definitions.--As used in this section:
(1) The term ``aggregate consumer information'' means
collective data that relates to a group or category of retail
electric consumers, from which individual consumer identities
and characteristics have been removed.
(2) The term ``consumer information'' means information
that relates to the quantity, technical configuration, type,
destination, or amount of use of electric energy delivered to
any retail electric consumer.

SEC. 253. OFFICE OF CONSUMER ADVOCACY.

(a) Definitions.--In this section:
(1) Commission.--The term ``Commission'' means the Federal
Energy Regulatory Commission.
(2) Energy customer.--The term ``energy customer'' means a
residential customer or a small commercial customer that
receives products or services from a public utility or
natural gas company under the jurisdiction of the Commission.
(3) Natural gas company.--The term ``natural gas company''
has the meaning given the term in section 2 of the Natural
Gas Act (15 U.S.C. 717a), as modified by section 601(a) of
the Natural Gas Policy Act of 1978 (15 U.S.C. 3431(a)).
(4) Office.--The term ``Office'' means the Office of
Consumer Advocacy established by subsection (b)(1).
(5) Public utility.--The term ``public utility'' has the
meaning given the term in section 201(e) of the Federal Power
Act (16 U.S.C. 824(e)).
(6) Small commercial customer.--The term ``small commercial
customer'' means a commercial customer that has a peak demand
of not more than 1,000 kilowatts per hour.
(b) Office.--
(1) Establishment.--There is established within the
Department of Justice the Office of Consumer Advocacy.
(2) Director.--The Office shall be headed by a Director to
be appointed by the President, by and with the advice and
consent of the Senate.
(3) Duties.--The Office may represent the interests of
energy customers on matters concerning rates or service of
public utilities and natural gas companies under the
jurisdiction of the Commission--
(A) at hearings of the Commission;
(B) in judicial proceedings in the courts of the United
States;
(C) at hearings or proceedings of other Federal regulatory
agencies and commissions.

SEC. 254. UNFAIR TRADE PRACTICES.

(a) Slamming.--The Federal Trade Commission shall issue
rules prohibiting the change of selection of an electric
utility except with the informed consent of the electric
consumer.
(b) Cramming.--The Federal Trade Commission shall issue
rules prohibiting the sale of goods and services to an
electric consumer unless expressly authorized by law or the
electric consumer.

SEC. 255. APPLICABLE PROCEDURES.

The Federal Trade Commission shall proceed in accordance
with section 553 of title 5, United States Code, when
prescribing a rule required by this subtitle.

SEC. 256. FEDERAL TRADE COMMISSION ENFORCEMENT.

Violation of a rule issued under this subtitle shall be
treated as a violation of a rule under section 18 of the
Federal Trade Commission Act (15 U.S.C. 57a) respecting
unfair or deceptive acts or practices. All functions and
powers of the Federal Trade Commission under such Act are
available to the Federal Trade Commission to enforce
compliance with this subtitle notwithstanding any
jurisdictional limits in such Act.

SEC. 257. STATE AUTHORITY.

Nothing in this subtitle shall be construed to preclude a
State or State regulatory authority from prescribing and
enforcing laws, rules, or procedures regarding the practices
which are the subject of this section.

SEC. 258. APPLICATION OF SUBTITLE.

The provisions of this subtitle apply to each electric
utility if the total sales of electric energy by such utility
for purposes other than resale exceed 500 million kilowatt-
hours per calendar year. The provisions of this subtitle do
not apply to the operations of an electric utility to the
extent that such operations relate to sales of electric
energy for purposes of resale.

SEC. 259. DEFINITIONS.

As used in this subtitle:
(1) The term ``aggregate consumer information'' means
collective data that relates to a group or category of
electric consumers, from which individual consumer identities
and identifying characteristics have been removed.
(2) The term ``consumer information'' means information
that relates to the quantity, technical configuration, type,
destination, or amount of use of electric energy delivered to
an electric consumer.
(3) The terms ``electric consumer'', ``electric utility'',
and ``State regulatory authority'' have the meanings given
such terms in section 3 of the Public Utility Regulatory
Policies Act of 1978 (16 U.S.C. 2602).

Subtitle E--Renewable Energy and Rural Construction Grants

SEC. 261. RENEWABLE ENERGY PRODUCTION INCENTIVE.

(a) Incentive Payments.--Section 1212(a) of the Energy
Policy Act of 1992 (42 U.S.C. 13317(a)) is amended by
striking ``and which satisfies'' and all that follows through
``Secretary shall establish.'' and inserting the following:
``. The Secretary shall establish other procedures necessary
for efficient administration of the program. The Secretary
shall not establish any criteria or procedures that have the
effect of assigning to proposals a higher or lower priority
for eligibility or allocation of appropriated funds on the
basis of the energy source proposed.''.
(b) Qualified Renewable Energy Facility.--Section 1212(b)
of the Energy Policy Act of 1992 (42 U.S.C. 13317(b)) is
amended--
(1) by striking ``a State or any political'' and all that
follows through ``nonprofit electrical cooperative'' and
inserting the following: ``a nonprofit electrical
cooperative, a public utility described in section 115 of
such Code, a State, Commonwealth, territory, or possession of
the United States or the District of Columbia, or a political
subdivision thereof, or an Indian tribal government or
subdivision thereof,''; and
(2) by inserting ``landfill gas, incremental hydropower,
ocean'' after ``wind, biomass,''.
(c) Eligibility Window.--Section 1212(c) of the Energy
Policy Act of 1992 (42 U.S.C. 13317(c)) is amended by
striking ``during the 10-fiscal year period beginning with
the first full fiscal year occurring after the enactment of
this section'' and inserting ``before October 1, 2013''.
(d) Payment Period.--Section 1212(d) of the Energy Policy
Act of 1992 (42 U.S.C. 13317(d)) is amended by inserting ``or
in which the Secretary finds that all necessary Federal and
State authorizations have been obtained to begin construction
of the facility'' after ``eligible for such payments''.
(e) Amount of Payment.--Section 1212(e)(1) of the Energy
Policy Act of 1992 (42 U.S.C. 13317(e)(1)) is amended by
inserting ``landfill gas, incremental hydropower, ocean''
after ``wind, biomass,''.
(f) Sunset.--Section 1212(f) of the Energy Policy Act of
1992 (42 U.S.C. 13317(f)) is amended by striking ``the
expiration of'' and all that follows through ``of this
section'' and inserting ``September 30, 2023''.
(g) Incremental Hydropower; Authorization of
Appropriations.--Section 1212 of the Energy Policy Act of
1992 (42 U.S.C. 13317) is further amended by striking
subsection (g) and inserting the following:
``(g) Incremental Hydropower.--
``(1) Programs.--Subject to subsection (h)(2), if an
incremental hydropower program meets the requirements of this
section, as determined by the Secretary, the incremental
hydropower program shall be eligible to receive incentive
payments under this section.
``(2) Definition of Incremental Hydropower.--In this
subsection, the term `incremental hydropower' means
additional generating capacity achieved from increased
efficiency or additions of new capacity at a hydroelectric
facility in existence on the date of enactment of this
paragraph.
``(h) Authorization of Appropriations.--
``(1) In general.--Subject to paragraph (2), there are
authorized to be appropriated such sums as may be necessary
to carry out this section for fiscal years 2003 through 2023.
``(2) Limitation on funds used for incremental hydropower
programs.--Not more than 30 percent of the amounts made
available under paragraph (1) shall be used to carry out
programs described in subsection (g)(2).
``(3) Availability of funds.--Funds made available under
paragraph (1) shall remain available until expended.''.

SEC. 262. ASSESSMENT OF RENEWABLE ENERGY RESOURCES.

(a) Resource Assessment.--Not later than 3 months after the
date of enactment of this title, and each year thereafter,
the Secretary of Energy shall review the available
assessments of renewable energy resources available within
the United States, including solar, wind, biomass, ocean,
geothermal, and hydroelectric energy resources, and undertake
new assessments as necessary, taking into account changes in
market conditions, available technologies and other relevant
factors.
(b) Contents of Reports.--Not later than 1 year after the
date of enactment of this title, and each year thereafter,
the Secretary shall publish a report based on the assessment
under subsection (a). The report shall contain--
(1) a detailed inventory describing the available amount
and characteristics of the renewable energy resources, and
(2) such other information as the Secretary of Energy
believes would be useful in developing such renewable energy
resources, including descriptions of surrounding terrain,
population and load centers, nearby energy infrastructure,
location of energy and water resources, and available
estimates of the costs needed to develop each resource,
together with an identification of any barriers to providing
adequate transmission for remote sources of renewable energy
resources to current and emerging markets, recommendations
for removing or addressing such barriers, and ways to provide
access to the grid that do not unfairly disadvantage
renewable or other energy producers.

SEC. 263. FEDERAL PURCHASE REQUIREMENT.

(a) Requirement.--The President shall seek to ensure that,
to the extent economically feasible and technically
practicable, of the total amount of electric energy the
Federal Government consumes during any fiscal year--
(1) not less than 3 percent in fiscal years 2003 through
2004,
(2) not less than 5 percent in fiscal years 2005 through
2009, and
(3) not less than 7.5 percent in fiscal year 2010 and each
fiscal year thereafter,
shall be renewable energy. The President shall encourage the
use of innovative purchasing practices by Federal agencies.
(b) Definition.--For purposes of this section, the term
``renewable energy'' means electric energy generated from
solar, wind, biomass, geothermal, fuel cells, municipal solid
waste, or additional hydroelectric generation capacity
achieved from increased efficiency or additions of new
capacity.

[[Page S10746]]

(c) Tribal Power Generation.--The President shall seek to
ensure that, to the extent economically feasible and
technically practicable, not less than one-tenth of the
amount specified in subsection (a) shall be renewable energy
that is generated by an Indian tribe or by a corporation,
partnership, or business association which is wholly or
majority owned, directly or indirectly, by an Indian tribe.
For purposes of this subsection, the term ``Indian tribe''
means any Indian tribe, band, nation, or other organized
group or community, including any Alaskan 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.
(d) Biennial Report.--In 2004 and every 2 years thereafter,
the Secretary of Energy shall report to the Committee on
Energy and Natural Resources of the Senate and the
appropriate committees of the House of Representatives on the
progress of the Federal Government in meeting the goals
established by this section.

SEC. 264. RENEWABLE PORTFOLIO STANDARD.

Title VI of the Public Utility Regulatory Policies Act of
1978 is amended by adding at the end the following:

``SEC. 606. FEDERAL RENEWABLE PORTFOLIO STANDARD.

``(a) Minimum Renewable Generation Requirement.--For each
calendar year beginning in calendar year 2005, each retail
electric supplier shall submit to the Secretary, not later
than April 1 of the following calendar year, renewable energy
credits in an amount equal to the required annual percentage
specified in subsection (b).
``(b) Required Annual Percentage.--(1) For calendar years
2005 through 2020, the required annual percentage of the
retail electric supplier's base amount that shall be
generated from renewable energy resources shall be the
percentage specified in the following table:

Required annual
``Calendar Years                                           percentage
2005 through 2006..............................................1.0
2007 through 2008..............................................2.2
2009 through 2010..............................................3.4
2011 through 2012..............................................4.6
2013 through 2014..............................................5.8
2015 through 2016..............................................7.0
2017 through 2018..............................................8.5
2019 through 2020.............................................10.0.
``(2) Not later than January 1, 2015, the Secretary may, by
rule, establish required annual percentages in amounts not
less than 10.0 for calendar years 2020 through 2030.
``(c) Submission of Credits.--(1) A retail electric
supplier may satisfy the requirements of subsection (a)
through the submission of renewable energy credits--
``(A) issued to the retail electric supplier under
subsection (d);
``(B) obtained by purchase or exchange under subsection
(e); or
``(C) borrowed under subsection (f).
``(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 1 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 location where the electric energy was produced,
and
``(C) any other information the Secretary determines
appropriate.
``(3)(A) Except as provided in paragraphs (B), (C), and
(D), the Secretary shall issue to an entity one renewable
energy credit for each kilowatt-hour of electric energy the
entity generates from the date of enactment of this section
and in each subsequent calendar year through the use of a
renewable energy resource at an eligible facility.
``(B) For incremental hydropower the credits shall be
calculated based on the expected increase in average annual
generation resulting from the efficiency improvements or
capacity additions. The number of credits shall be calculated
using the same water flow information used to determine a
historic average annual generation baseline for the
hydroelectric facility and certified by the Secretary or the
Federal Energy Regulatory Commission. The calculation of the
credits for incremental hydropower shall not be based on any
operational changes at the hydroelectric facility 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
and supplied to the grid in that calendar year through the
use of a renewable energy resource at an eligible facility
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) For renewable energy resources produced from a
generation offset, the Secretary shall issue two renewable
energy credits for each kilowatt-hour generated.
``(E) To be eligible for a renewable energy credit, the
unit of electric energy 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
nonrenewable energy resource are used to generate the
electric energy, the Secretary shall issue credits based on
the proportion of the renewable energy resource used. The
Secretary shall identify renewable energy credits by type and
date of generation.
``(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.
``(6) The Secretary may issue credits for existing facility
offsets to be applied against a retail electric supplier's
own required annual percentage. The credits are not tradeable
and may only be used in the calendar year generation actually
occurs.
``(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 within the next 4 years.
``(f) Credit Borrowing.--At any time before the end of
calendar year 2005, a retail electric supplier that has
reason to believe 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's to meet the
requirements of subsection (a) for calendar year 2005 and the
subsequent calendar years 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 each calendar year involved.
``(g) Credit Cost Cap.--The Secretary shall offer renewable
energy credits for sale at the lesser of 3 cents per
kilowatt-hour or 200 percent of the average market value of
credits for the applicable compliance period. On January 1 of
each year following calendar year 2005, the Secretary shall
adjust for inflation the price charged per credit for such
calendar year, based on the Gross Domestic Product Implicit
Price Deflator.
``(h) Enforcement.--The Secretary may bring an action in
the appropriate United States district court to impose a
civil penalty on a retail electric supplier that does not
comply with subsection (a), unless the retail electric
supplier was unable to comply with subsection (a) for reasons
outside of the supplier's reasonable control (including
weather-related damage, mechanical failure, lack of
transmission capacity or availability, strikes, lockouts,
actions of a governmental authority). A retail electric
supplier who does not submit the required number of renewable
energy credits under subsection (a) shall be subject to a
civil penalty of not more than the greater of 3 cents or 200
percent of the average market value of credits for the
compliance period for each renewable energy credit not
submitted.
``(i) 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.
``(j) Environmental Savings Clause.--Incremental hydropower
shall be subject to all applicable environmental laws and
licensing and regulatory requirements.
``(k) State Savings Clause.--This section does not preclude
a State from requiring additional renewable energy generation
in that State, or from specifying technology mix.
``(l) Definitions.--For purposes of this section:
``(1) Biomass.--The term `biomass' means any organic
material that is available on a renewable or recurring basis,
including dedicated energy crops, trees grown for energy
production, wood waste and wood residues, plants (including
aquatic plants, grasses, and agricultural crops), residues,
fibers, animal wastes and other organic waste materials, and
fats and oils, except that with respect to material removed
from National Forest System lands the term includes only
organic material from--
``(A) thinnings from trees that are less than 12 inches in
diameter;
``(B) slash;
``(C) brush; and
``(D) mill residues.
``(2) Eligible facility.--The term `eligible facility'
means--
``(A) a facility for the generation of electric energy from
a renewable energy resource that is placed in service on or
after the date of enactment of this section; or
``(B) a repowering or cofiring increment that is placed in
service on or after the date of enactment of this section at
a facility for the generation of electric energy from a
renewable energy resource that was placed in service before
that date.
``(3) Eligible renewable energy resource.--The term
`renewable energy resource' means solar, wind, ocean, or
geothermal energy, biomass (excluding solid waste and paper
that is commonly recycled), landfill gas, a generation
offset, or incremental hydropower.
``(4) Generation offset.--The term `generation offset'
means reduced electricity usage metered at a site where a
customer consumes energy from a renewable energy technology.
``(5) Existing facility offset.--The term `existing
facility offset' means renewable energy

[[Page S10747]]

generated from an existing facility, not classified as an
eligible facility, that is owned or under contract to a
retail electric supplier on the date of enactment of this
section.
``(6) Incremental hydropower.--The term `incremental
hydropower' means additional generation that is achieved from
increased efficiency or additions of capacity after the date
of enactment of this section at a hydroelectric dam that was
placed in service before that date.
``(7) Indian land.--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.
``(8) Indian tribe.--The term `Indian tribe' means any
Indian tribe, band, nation, or other organized group or
community, including any Alaskan 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.
``(9) Renewable energy.--The term `renewable energy' means
electric energy generated by a renewable energy resource.
``(10) Renewable energy resource.--The term `renewable
energy resource' means solar, wind, ocean, or geothermal
energy, biomass (including municipal solid waste), landfill
gas, a generation offset, or incremental hydropower.
``(11) Repowering or cofiring increment.--The term
`repowering or cofiring increment' means the additional
generation from a modification that is placed in service on
or after the date of enactment of this section to expand
electricity production at a facility used to generate
electric energy from a renewable energy resource or to cofire
biomass that was placed in service before the date of
enactment of this section, or the additional generation above
the average generation in the 3 years preceding the date of
enactment of this section, to expand electricity production
at a facility used to generate electric energy from a
renewable energy resource or to cofire biomass that was
placed in service before the date of enactment of this
section.
``(12) Retail electric supplier.--The term `retail electric
supplier' means a person that sells electric energy to
electric consumers and sold not less than 1,000,000 megawatt-
hours of electric energy to electric consumers for purposes
other than resale during the preceding calendar year; except
that such term does not include the United States, a State or
any political subdivision of a State, or any agency,
authority, or instrumentality of any one or more of the
foregoing, or a rural electric cooperative.
``(13) Retail electric supplier's base amount.--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--
``(A) an eligible renewable energy resource;
``(B) municipal solid waste; or
``(C) a hydroelectric facility.
``(m) Sunset.--This section expires December 31, 2030.''.

SEC. 265. RENEWABLE ENERGY ON FEDERAL LAND.

(a) Cost-Share Demonstration Program.--Within 12 months
after the date of enactment of this section, the Secretaries
of the Interior, Agriculture, and Energy shall develop
guidelines for a cost-share demonstration program for the
development of wind and solar energy facilities on Federal
land.
(b) Definition of Federal Land.--As used in this section,
the term ``Federal land'' means land owned by the United
States that is subject to the operation of the mineral
leasing laws; and is either--
(1) public land as defined in section 103(e) of the Federal
Land Policy and Management Act of 1976 (42 U.S.C. 1702(e));
or
(2) a unit of the National Forest System as that term is
used in section 11(a) of the Forest and Rangeland Renewable
Resources Planning Act of 1974 (16 U.S.C. 1609(a)).
(c) Rights-of-Way.--The demonstration program shall provide
for the issuance of rights-of-way pursuant to the provisions
of title V of the Federal Land Policy and Management Act of
1976 (43 U.S.C. 1761 et seq.) by the Secretary of the
Interior with respect to Federal land under the jurisdiction
of the Department of the Interior, and by the Secretary of
Agriculture with respect to Federal lands under the
jurisdiction of the Department of Agriculture.
(d) Available Sites.--For purposes of this demonstration
program, the issuance of rights-of-way shall be limited to
areas--
(1) of high energy potential for wind or solar development;
(2) that have been identified by the wind or solar energy
industry, through a process of nomination, application, or
otherwise, as being of particular interest to one or both
industries;
(3) that are not located within roadless areas;
(4) where operation of wind or solar facilities would be
compatible with the scenic, recreational, environmental,
cultural, or historic values of the Federal land, and would
not require the construction of new roads for the siting of
lines or other transmission facilities; and
(5) where issuance of the right-of-way is consistent with
the land and resource management plans of the relevant land
management agencies.
(e) Cost-Share Payments by DOE.--The Secretary of Energy,
in cooperation with the Secretary of the Interior with
respect to Federal land under the jurisdiction of the
Department of the Interior, and the Secretary of Agriculture
with respect to Federal land under the jurisdiction of the
Department of Agriculture, shall determine if the portion of
a project on Federal land is eligible for financial
assistance pursuant to this section. Only those projects that
are consistent with the requirements of this section and
further the purposes of this section shall be eligible. In
the event a project is selected for financial assistance, the
Secretary of Energy shall provide no more than 15 percent of
the costs of the project on the Federal land, and the
remainder of the costs shall be paid by non-Federal sources.
(f) Revision of Land Use Plans.--The Secretary of the
Interior shall consider development of wind and solar energy,
as appropriate, in revisions of land use plans under section
202 of the Federal Land Policy and Management Act of 1976 (42
U.S.C. 1712); and the Secretary of Agriculture shall consider
development of wind and solar energy, as appropriate, in
revisions of land and resource management plans under section
5 of the Forest and Rangeland Renewable Resources Planning
Act of 1974 (16 U.S.C. 1604). Nothing in this subsection
shall preclude the issuance of a right-of-way for the
development of a wind or solar energy project prior to the
revision of a land use plan by the appropriate land
management agency.
(g) Report to Congress.--Within 24 months after the date of
enactment of this section, the Secretary of the Interior
shall develop and report to Congress recommendations on any
statutory or regulatory changes the Secretary believes would
assist in the development of renewable energy on Federal
land. The report shall include--
(1) a five-year plan developed by the Secretary of the
Interior, in cooperation with the Secretary of Agriculture,
for encouraging the development of wind and solar energy on
Federal land in an environmentally sound manner; and
(2) an analysis of--
(A) whether the use of rights-of-ways is the best means of
authorizing use of Federal land for the development of wind
and solar energy, or whether such resources could be better
developed through a leasing system, or other method;
(B) the desirability of grants, loans, tax credits or other
provisions to promote wind and solar energy development on
Federal land; and
(C) any problems, including environmental concerns, which
the Secretary of the Interior or the Secretary of Agriculture
have encountered in managing wind or solar energy projects on
Federal land, or believe are likely to arise in relation to
the development of wind or solar energy on Federal land;
(3) a list, developed in consultation with the Secretaries
of Energy and Defense, of lands under the jurisdiction of the
Departments of Energy and Defense that would be suitable for
development for wind or solar energy, and recommended
statutory and regulatory mechanisms for such development.
(h) National Academy of Sciences Study.-- Within 90 days
after the enactment of this Act, the Secretary of the
Interior shall contract with the National Academy of Sciences
to study the potential for the development of wind, solar,
and ocean energy on the Outer Continental Shelf; assess
existing Federal authorities for the development of such
resources; and recommend statutory and regulatory mechanisms
for such development. The results of the study shall be
transmitted to Congress within 24 months after the enactment
of this Act.

Subtitle F--General Provisions

SEC. 271. CHANGE 3 CENTS TO 1.5 CENTS.

Not withstanding any other provision in this Act, ``3
cents'' shall be considered by law to be ``1.5 cents'' in any
place ``3 cents'' appears in title II of this Act.

SEC. 272. BONNEVILLE POWER ADMINISTRATION BONDS.

Section 13 of the Federal Columbia River Transmission
System Act (16 U.S.C. 838k) is amended--
(1) by striking the section heading and all that follows
through ``(a) The Administrator'' and inserting the
following:

``SEC. 13. BONNEVILLE POWER ADMINISTRATION BONDS.

``(a) Bonds.--
``(1) In general.--The Administrator''; and
(2) by adding at the end the following:
``(2) Additional borrowing authority.--In addition to the
borrowing authority of the Administrator authorized under
paragraph (1) or any other provision of law, an additional
$1,300,000,000 is made available, to remain outstanding at
any one time--
``(A) to provide funds to assist in financing the
construction, acquisition, and replacement of the
transmission system of the Bonneville Power Administration;
and
``(B) to implement the authorities of the Administrator
under the Pacific Northwest Electric Power Planning and
Conservation Act (16 U.S.C. 839 et seq.).''.

TITLE III--HYDROELECTRIC RELICENSING

SEC. 301. ALTERNATIVE CONDITIONS AND FISHWAYS.

(a) Alternative Mandatory Conditions.--Section 4 of the
Federal Power Act (16 U.S.C. 797) is amended by adding at the
end the following:
``(h)(1) Whenever any person applies for a license for any
project works within any reservation of the United States
under subsection (e), and the Secretary of the department
under whose supervision such reservation falls (in this
subsection referred to as the `Secretary') shall

[[Page S10748]]

deem a condition to such license to be necessary under the
first proviso of such section, the license applicant may
propose an alternative condition.
``(2) Notwithstanding the first proviso of subsection (e),
the Secretary of the department under whose supervision the
reservation falls shall accept the proposed alternative
condition referred to in paragraph (1), and the Commission
shall include in the license such alternative condition, if
the Secretary of the appropriate department determines, based
on substantial evidence provided by the license applicant,
that the alternative condition--
``(A) provides for the adequate protection and utilization
of the reservation; and
``(B) will either--
``(i) cost less to implement, or
``(ii) result in improved operation of the project works
for electricity production as compared to the condition
initially deemed necessary by the Secretary.
``(3) The Secretary shall submit into the public record of
the Commission proceeding with any condition under subsection
(e) or alternative condition it accepts under this subsection
a written statement explaining the basis for such condition,
and reason for not accepting any alternative condition under
this subsection, including the effects of the condition
accepted and alternatives not accepted on energy supply,
distribution, cost, and use, air quality, flood control,
navigation, and drinking, irrigation, and recreation water
supply, based on such information as may be available to the
Secretary, including information voluntarily provided in a
timely manner by the applicant and others.
``(4) Nothing in this subsection shall prohibit other
interested parties from proposing alternative conditions.''.
(b) Alternative Fishways.--Section 18 of the Federal Power
Act (16 U.S.C. 811) is amended by--
(1) inserting ``(a)'' before the first sentence; and
(2) adding at the end the following:
``(b)(1) Whenever the Secretary of the Interior or the
Secretary of Commerce prescribes a fishway under this
section, the license applicant or the licensee may propose an
alternative to such prescription to construct, maintain, or
operate a fishway.
``(2) Notwithstanding subsection (a), the Secretary of the
Interior or the Secretary of Commerce, as appropriate, shall
accept and prescribe, and the Commission shall require, the
proposed alternative referred to in paragraph (1), if the
Secretary of the appropriate department determines, based on
substantial evidence provided by the licensee, that the
alternative--
``(A) will be no less protective of the fish resources than
the fishway initially prescribed by the Secretary; and
``(B) will either--
``(i) cost less to implement, or
``(ii) result in improved operation of the project works
for electricity production as compared to the fishway
initially prescribed by the Secretary.
``(3) The Secretary shall submit into the public record of
the Commission proceeding with any prescription under
subsection (a) or alternative prescription it accepts under
this subsection a written statement explaining the basis for
such prescription, and reason for not accepting any
alternative prescription under this subsection, including the
effects of the prescription accepted or alternative not
accepted on energy supply, distribution, cost, and use, air
quality, flood control, navigation, and drinking, irrigation,
and recreation water supply, based on such information as may
be available to the Secretary, including information
voluntarily provided in a timely manner by the applicant and
others.
``(4) Nothing in this subsection shall prohibit other
interested parties from proposing alternative
prescriptions.''.
(c) Time of Filing Application.--Section 15(c)(1) of the
Federal Power Act (16 U.S.C. 808(c)(1)) is amended by
striking the first sentence and inserting the following:
``(1) Each application for a new license pursuant to this
section shall be filed with the Commission--
``(A) at least 24 months before the expiration of the term
of the existing license in the case of licenses that expire
prior to 2008; and
``(B) at least 36 months before the expiration of the term
of the existing license in the case of licenses that expire
in 2008 or any year thereafter.''.

TITLE IV--INDIAN ENERGY

SEC. 401. COMPREHENSIVE INDIAN ENERGY PROGRAM.

Title XXVI of the Energy Policy Act of 1992 (25 U.S.C.
3501-3506) is amended by adding after section 2606 the
following:

``SEC. 2607. COMPREHENSIVE INDIAN ENERGY PROGRAM.

``(a) Definitions.--For purposes of this section--
``(1) the term `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) the term `Indian land' means--
``(A) any land within the limits of an Indian reservation,
pueblo, or rancheria;
``(B) any land not within the limits of an Indian
reservation, pueblo, or rancheria whose title is 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 in meeting 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, energy efficiency, and conservation
programs;
``(B) studies and other activities supporting tribal
acquisition of energy supplies, services, and facilities;
``(C) planning, constructing, developing, operating,
maintaining, and improving tribal electrical generation,
transmission, and distribution facilities; and
``(D) developing, constructing, and interconnecting
electric power transmission facilities with transmission
facilities owned and operated by a Federal power marketing
agency or an electric utility that provides open access
transmission service.
``(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) the total number of acres of Indian land owned by an
Indian tribe;
``(B) the total number of households on the Indian tribe's
Indian land;
``(C) the total number of households on the Indian tribe's
Indian land that have no electricity service or are under-
served; and
``(D) financial or other assets available to the Indian
tribe from any source.
``(4) In making a grant under paragraph (2), the Director
shall give priority to an application received from an Indian
tribe that is not served or is 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.
``(6) The Secretary is authorized to promulgate such
regulations as the Secretary determines to be necessary to
carry out the provisions of this subsection.
``(c) Loan Guarantee Program.--
``(1) Authority.--The Secretary may guarantee not more than
90 percent of the unpaid principal and interest due on any
loan made to any Indian tribe for energy development,
including the planning, development, construction, and
maintenance of electrical generation plants, and for
transmission and delivery mechanisms for electricity produced
on Indian land. A loan guaranteed under this subsection shall
be made by--
``(A) a financial institution subject to the examination of
the Secretary; or
``(B) an Indian tribe, from funds of the Indian tribe, to
another Indian tribe.
``(2) Availability of appropriations.--Amounts appropriated
to cover the cost of loan guarantees shall be available
without fiscal year limitation to the Secretary to fulfill
obligations arising under this subsection.
``(3) Authorization of appropriations.--(A) There are
authorized to be appropriated to the Secretary such sums as
may be necessary to cover the cost of loan guarantees, as
defined by section 502(5) of the Federal Credit Reform Act of
1990 (2 U.S.C. 661a(5)).
``(B) There are authorized to be appropriated to the
Secretary such sums as may be necessary to cover the
administrative expenses related to carrying out the loan
guarantee program established by this subsection.
``(4) Limitation on amount.--The aggregate outstanding
amount guaranteed by the Secretary of Energy at any one time
under this subsection shall not exceed $2,000,000,000.
``(5) Regulations.--The Secretary is authorized to
promulgate such regulations as the Secretary determines to be
necessary to carry out the provisions of this subsection.
``(d) Indian Energy Preference.--(1) An agency or
department of the United States Government may give, in the
purchase of electricity, oil, gas, coal, or other energy
product or by-product, preference in such purchase to an
energy and resource production enterprise, partnership,
corporation, or other type of business organization majority
or wholly owned and controlled by a tribal government.
``(2) In implementing this subsection, an agency or
department shall pay no more than the prevailing market price
for the energy product or by-product and shall obtain no less
than existing market terms and conditions.
``(e) Effect on Other Laws.--This section does not--
``(1) limit the discretion vested in an Administrator of a
Federal power marketing agency to market and allocate Federal
power, or
``(2) alter Federal laws under which a Federal power
marketing agency markets, allocates, or purchases power.''.

SEC. 402. OFFICE OF INDIAN ENERGY POLICY AND PROGRAMS.

Title II of the Department of Energy Organization Act is
amended by adding at the end the following:

``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.
``(b) The Director shall provide, direct, foster,
coordinate, and implement energy planning, education,
management, conservation, and delivery programs of the
Department that--

[[Page S10749]]

``(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 or the Director under title XXVI of the Energy
Policy Act of 1992 (25 U.S.C. 3501 et seq.).''.

SEC. 403. CONFORMING AMENDMENTS.

(a) Authorization of Appropriations.--Section 2603(c) of
the Energy Policy Act of 1992 (25 U.S.C. 3503(c)) is amended
to read as follows:
``(c) Authorization of Appropriations.--There are
authorized to be appropriated such sums as may be necessary
to carry out the purposes of this section.''.
(b) Table of Contents.--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:

``Sec. 217. Office of Indian Energy Policy and Programs.''.
(c) Executive Schedule.--Section 5315 of title 5, United
States Code, is amended by inserting ``Director, Office of
Indian Energy Policy and Programs, Department of Energy.''
after ``Inspector General, Department of Energy.''.

SEC. 404. SITING ENERGY FACILITIES ON TRIBAL LANDS.

(a) Definitions.--For purposes of this section:
(1) Indian tribe.--The term ``Indian tribe'' means any
Indian tribe, band, nation, or other organized group or
community, which is recognized as eligible for the special
programs and services provided by the United States to
Indians because of their status as Indians, except that such
term does not include any Regional Corporation as defined in
section 3(g) of the Alaska Native Claims Settlement Act (43
U.S.C. 1602(g)).
(2) Interested party.--The term ``interested party'' means
a person whose interests could be adversely affected by the
decision of an Indian tribe to grant a lease or right-of-way
pursuant to this section.
(3) Petition.--The term ``petition'' means a written
request submitted to the Secretary for the review of an
action (or inaction) of the Indian tribe that is claimed to
be in violation of the approved tribal regulations.
(4) Reservation.--The term ``reservation'' means--
(A) with respect to a reservation in a State other than
Oklahoma, all land that has been set aside or that has been
acknowledged as having been set aside by the United States
for the use of an Indian tribe, the exterior boundaries of
which are more particularly defined in a final tribal treaty,
agreement, executive order, Federal statute, secretarial
order, or judicial determination;
(B) with respect to a reservation in the State of Oklahoma,
all land that is--
(i) within the jurisdictional area of an Indian tribe, and
(ii) within the boundaries of the last reservation of such
tribe that was established by treaty, executive order, or
secretarial order.
(5) Secretary.--The term ``Secretary'' means the Secretary
of the Interior.
(6) Tribal lands.--The term `tribal lands' means any tribal
trust lands, or other lands owned by an Indian tribe that are
within such tribe's reservation.
(b) Leases Involving Generation, Transmission, Distribution
or Energy Processing Facilities.--An Indian tribe may grant a
lease of tribal land for electric generation, transmission,
or distribution facilities, or facilities to process or
refine renewable or nonrenewable energy resources developed
on tribal lands, and such leases shall not require the
approval of the Secretary if the lease is executed under
tribal regulations approved by the Secretary under this
subsection and the term of the lease does not exceed 30
years.
(c) Rights-of-Way for Electric Generation, Transmission,
Distribution or Energy Processing Facilities.--An Indian
tribe may grant a right-of-way over tribal lands for a
pipeline or an electric transmission or distribution line
without separate approval by the Secretary, if--
(1) the right-of-way is executed under and complies with
tribal regulations approved by the Secretary and the term of
the right-of-way does not exceed 30 years; and
(2) the pipeline or electric transmission or distribution
line serves--
(A) an electric generation, transmission or distribution
facility located on tribal land, or
(B) a facility located on tribal land that processes or
refines renewable or nonrenewable energy resources developed
on tribal lands.
(d) Renewals.--Leases or rights-of-way entered into under
this subsection may be renewed at the discretion of the
Indian tribe in accordance with the requirements of this
section.
(e) Tribal Regulation Requirements.--(1) The Secretary
shall have the authority to approve or disapprove tribal
regulations required under this subsection. The Secretary
shall approve such tribal regulations if they are
comprehensive in nature, including provisions that address--
(A) securing necessary information from the lessee or
right-of-way applicant;
(B) term of the conveyance;
(C) amendments and renewals;
(D) consideration for the lease or right-of-way;
(E) technical or other relevant requirements;
(F) requirements for environmental review as set forth in
paragraph (3);
(G) requirements for complying with all applicable
environmental laws; and
(H) final approval authority.
(2) No lease or right-of-way shall be valid unless
authorized in compliance with the approved tribal
regulations.
(3) An Indian tribe, as a condition of securing Secretarial
approval as contemplated in paragraph (1), must establish an
environmental review process that includes the following--
(A) an identification and evaluation of all significant
environmental impacts of the proposed action as compared to a
no action alternative;
(B) identification of proposed mitigation;
(C) a process for ensuring that the public is informed of
and has an opportunity to comment on the proposed action
prior to tribal approval of the lease or right-of-way; and
(D) sufficient administrative support and technical
capability to carry out the environmental review process.
(4) The Secretary shall review and approve or disapprove
the regulations of the Indian tribe within 180 days of the
submission of such regulations to the Secretary. Any
disapproval of such regulations by the Secretary shall be
accompanied by written documentation that sets forth the
basis for the disapproval. The 180-day period may be extended
by the Secretary after consultation with the Indian tribe.
(5) If the Indian tribe executes a lease or right-of-way
pursuant to tribal regulations required under this
subsection, the Indian tribe shall provide the Secretary
with--
(A) a copy of the lease or right-of-way document and all
amendments and renewals thereto; and
(B) in the case of regulations or a lease or right-of-way
that permits payment to be made directly to the Indian tribe,
documentation of the payments sufficient to enable the
Secretary to discharge the trust responsibility of the United
States as appropriate under existing law.
(6) The United States shall not be liable for losses
sustained by any party to a lease executed pursuant to tribal
regulations under this subsection, including the Indian
tribe.
(7)(A) An interested party may, after exhaustion of tribal
remedies, submit, in a timely manner, a petition to the
Secretary to review the compliance of the Indian tribe with
any tribal regulations approved under this subsection. If
upon such review, the Secretary determines that the
regulations were violated, the Secretary may take such action
as may be necessary to remedy the violation, including
rescinding or holding the lease or right-of-way in abeyance
until the violation is cured. The Secretary may also rescind
the approval of the tribal regulations and reassume the
responsibility for approval of leases or rights-of-way
associated with the facilities addressed in this section.
(B) If the Secretary seeks to remedy a violation described
in subparagraph (A), the Secretary shall--
(i) make a written determination with respect to the
regulations that have been violated;
(ii) provide the Indian tribe with a written notice of the
alleged violation together with such written determination;
and
(iii) prior to the exercise of any remedy or the rescission
of the approval of the regulations involved and reassumption
of the lease or right-of-way approval responsibility, provide
the Indian tribe with a hearing and a reasonable opportunity
to cure the alleged violation.
(C) The tribe shall retain all rights to appeal as provided
by regulations promulgated by the Secretary.
(f) Agreements.--(1) Agreements between an Indian tribe and
a business entity that are directly associated with the
development of electric generation, transmission or
distribution facilities, or facilities to process or refine
renewable or nonrenewable energy resources developed on
tribal lands, shall not separately require the approval of
the Secretary pursuant to section 18 of title 25, United
States Code, so long as the activity that is the subject of
the agreement has been the subject of an environmental review
process pursuant to subsection (e) of this section.
(2) The United States shall not be liable for any losses or
damages sustained by any party, including the Indian tribe,
that are associated with an agreement entered into under this
subsection.
(g) Disclaimer.--Nothing in this section is intended to
modify or otherwise affect the applicability of any provision
of the Indian Mineral Leasing Act of 1938 (25 U.S.C. 396a-
396g); Indian Mineral Development Act of 1982 (25 U.S.C.
2101-2108); Surface Mining Control and Reclamation Act of
1977 (30 U.S.C. 1201-1328); any amendments thereto; or any
other laws not specifically addressed in this section.

SEC. 405. INDIAN MINERAL DEVELOPMENT ACT REVIEW.

(a) In General.--The Secretary of the Interior shall
conduct a review of the activities that have been conducted
by the governments of Indian tribes under the authority of
the Indian Mineral Development Act of 1982 (25 U.S.C. 2101 et
seq.).
(b) Report.--Not later than 1 year after the date of the
enactment of this Act, the Secretary shall transmit to the
Committee on Resources of the House of Representatives and
the Committee on Indian Affairs and the Committee on Energy
and Natural Resources of the Senate a report containing--
(1) the results of the review;
(2) recommendations designed to help ensure that Indian
tribes have the opportunity to develop their nonrenewable
energy resources; and
(3) an analysis of the barriers to the development of
energy resources on Indian land, including Federal policies
and regulations, and make recommendations regarding the
removal of those barriers.

[[Page S10750]]

(c) Consultation.--The Secretary shall consult with Indian
tribes on a government-to-government basis in developing the
report and recommendations as provided in this subsection.

SEC. 406. RENEWABLE ENERGY STUDY.

(a) In General.--Not later than 2 years after the date of
the enactment of this Act, and once every 2 years thereafter,
the Secretary of Energy shall transmit to the Committees on
Energy and Commerce and Resources of the House of
Representatives and the Committees on Energy and Natural
Resources and Indian Affairs of the Senate a report on energy
consumption and renewable energy development potential on
Indian land. The report shall identify barriers to the
development of renewable energy by Indian tribes, including
Federal policies and regulations, and make recommendations
regarding the removal of such barriers.
(b) Consultation.--The Secretary shall consult with Indian
tribes on a government-to-government basis in developing the
report and recommendations as provided in this section.

SEC. 407. FEDERAL POWER MARKETING ADMINISTRATIONS.

Title XXVI of the Energy Policy Act of 1992 (25 U.S.C.
3501) (as amended by section 201) is amended by adding at the
end the following:

``SEC. 2608. FEDERAL POWER MARKETING ADMINISTRATIONS.

``(a) Definition of Administrator.--In this section, the
term `Administrator' means--
``(1) the Administrator of the Bonneville Power
Administration; or
``(2) the Administrator of the Western Area Power
Administration.
``(b) Assistance for Transmission Studies.--(1) Each
Administrator may provide technical assistance to Indian
tribes seeking to use the high-voltage transmission system
for delivery of electric power. The costs of such technical
assistance shall be funded--
``(A) by the Administrator using non-reimbursable funds
appropriated for this purpose, or
``(B) by the Indian tribe.
``(2) Priority for assistance for transmission studies.--In
providing discretionary assistance to Indian tribes under
paragraph (1), each Administrator shall give priority in
funding to Indian tribes that have limited financial
capability to conduct such studies.
``(c) Power Allocation Study.--(1) Not later than 2 years
after the date of enactment of this Act, the Secretary of
Energy shall transmit to the Committees on Energy and
Commerce and Resources of the House of Representatives and
the Committees on Energy and Natural Resources and Indian
Affairs of the Senate a report on Indian tribes' utilization
of Federal power allocations of the Western Area Power
Administration, or power sold by the Southwestern Power
Administration, and the Bonneville Power Administration to or
for the benefit of Indian tribes in their service areas. The
report shall identify--
``(A) the amount of power allocated to tribes by the
Western Area Power Administration, and how the benefit of
that power is utilized by the tribes;
``(B) the amount of power sold to tribes by other Power
Marketing Administrations; and
``(C) existing barriers that impede tribal access to and
utilization of Federal power, and opportunities to remove
such barriers and improve the ability of the Power Marketing
Administration to facilitate the utilization of Federal power
by Indian tribes.
``(2) The Power Marketing Administrations shall consult
with Indian tribes on a government-to-government basis in
developing the report provided in this section.
``(d) Authorization for Appropriation.--There are
authorized to be appropriated to the Secretary of Energy such
sums as may be necessary to carry out the purposes of this
section.''.

SEC. 408. FEASIBILITY STUDY OF COMBINED WIND AND HYDROPOWER
DEMONSTRATION PROJECT.

(a) Study.--The Secretary of Energy, in coordination with
the Secretary of the Army and the Secretary of the Interior,
shall conduct a study of the cost and feasibility of
developing a demonstration project that would use wind energy
generated by Indian tribes and hydropower generated by the
Army Corps of Engineers on the Missouri River to supply
firming power to the Western Area Power Administration.
(b) Scope of Study.--The study shall--
(1) determine the feasibility of the blending of wind
energy and hydropower generated from the Missouri River dams
operated by the Army Corps of Engineers;
(2) review historical purchase requirements and projected
purchase requirements for firming and the patterns of
availability and use of firming energy;
(3) assess the wind energy resource potential on tribal
lands and projected cost savings through a blend of wind and
hydropower over a thirty-year period;
(4) include a preliminary interconnection study and a
determination of resource adequacy of the Upper Great Plains
Region of the Western Area Power Administration;
(5) determine seasonal capacity needs and associated
transmission upgrades for integration of tribal wind
generation; and
(6) include an independent tribal engineer as a study team
member.
(c) Report.--The Secretary of Energy and Secretary of the
Army shall submit a report to Congress not later than 1 year
after the date of enactment of this title. The Secretaries
shall include in the report--
(1) an analysis of the potential energy cost savings to the
customers of the Western Area Power Administration through
the blend of wind and hydropower;
(2) an evaluation of whether a combined wind and hydropower
system can reduce reservoir fluctuation, enhance efficient
and reliable energy production and provide Missouri River
management flexibility;
(3) recommendations for a demonstration project which the
Western Area Power Administration could carry out in
partnership with an Indian tribal government or tribal
government energy consortium to demonstrate the feasibility
and potential of using wind energy produced on Indian lands
to supply firming energy to the Western Area Power
Administration or other Federal power marketing agency; and
(4) an identification of the economic and environmental
benefits to be realized through such a Federal-tribal
partnership and identification of how such a partnership
could contribute to the energy security of the United States.
(d) Consultation.--The Secretary shall consult with Indian
tribes on a government-to-government basis in developing the
report and recommendations provided in this section.
(e) Authorization of Appropriations.--There are authorized
to be appropriated $500,000 to carry out this section, which
shall remain available until expended. All costs incurred by
the Western Area Power Administration associated with
performing the tasks required under this section shall be
nonreimbursable.

TITLE V--NUCLEAR POWER

Subtitle A--Price-Anderson Act Reauthorization

SEC. 501. SHORT TITLE.

This subtitle may be cited as the ``Price-Anderson
Amendments Act of 2003''.

SEC. 502. EXTENSION OF INDEMNIFICATION AUTHORITY.

(a) Indemnification of Nuclear Regulatory Commission
Licensees.--Section 170c. of the Atomic Energy Act of 1954
(42 U.S.C. 2210(c)) is amended--
(1) in the subsection heading, by striking ``Licenses'' and
inserting ``Licensees''; and
(2) by striking ``August 1, 2002'' each place it appears
and inserting ``August 1, 2012''.
(b) Indemnification of Department of Energy Contractors.--
Section 170d.(1)(A) of the Atomic Energy Act of 1954 (42
U.S.C. 2210(d)(1)(A)) is amended by striking ``, until August
1, 2002,''.
(c) Indemnification of Nonprofit Educational
Institutions.--Section 170k. of the Atomic Energy Act of 1954
(42 U.S.C. 2210(k)) is amended by striking ``August 1, 2002''
each place it appears and inserting ``August 1, 2012''.

SEC. 503. DEPARTMENT OF ENERGY LIABILITY LIMIT.

(a) Indemnification of Department of Energy Contractors.--
Section 170d. of the Atomic Energy Act of 1954 (42 U.S.C.
2210(d)) is amended by striking paragraph (2) and inserting
the following:
``(2) In agreements of indemnification entered into under
paragraph (1), the Secretary--
``(A) may require the contractor to provide and maintain
financial protection of such a type and in such amounts as
the Secretary shall determine to be appropriate to cover
public liability arising out of or in connection with the
contractual activity; and
``(B) shall indemnify the persons indemnified against such
liability above the amount of the financial protection
required, in the amount of $10,000,000,000 (subject to
adjustment for inflation under subsection t.), in the
aggregate, for all persons indemnified in connection with
such contract and for each nuclear incident, including such
legal costs of the contractor as are approved by the
Secretary.''.
(b) Contract Amendments.--Section 170d. of the Atomic
Energy Act of 1954 (42 U.S.C. 2210(d)) is further amended by
striking paragraph (3) and inserting the following:
``(3) All agreements of indemnification under which the
Department of Energy (or its predecessor agencies) may be
required to indemnify any person under this section shall be
deemed to be amended, on the date of the enactment of the
Price-Anderson Amendments Act of 2003, to reflect the amount
of indemnity for public liability and any applicable
financial protection required of the contractor under this
subsection.''.
(c) Liability Limit.--Section 170e.(1)(B) of the Atomic
Energy Act of 1954 (42 U.S.C. 2210(e)(1)(B)) is amended--
(1) by striking ``the maximum amount of financial
protection required under subsection b. or''; and
(2) by striking ``paragraph (3) of subsection d., whichever
amount is more'' and inserting ``paragraph (2) of subsection
d.''.

SEC. 504. INCIDENTS OUTSIDE THE UNITED STATES.

(a) Amount of Indemnification.--Section 170d.(5) of the
Atomic Energy Act of 1954 (42 U.S.C. 2210(d)(5)) is amended
by striking ``$100,000,000'' and inserting ``$500,000,000''.
(b) Liability Limit.--Section 170e.(4) of the Atomic Energy
Act of 1954 (42 U.S.C. 2210(e)(4)) is amended by striking
``$100,000,000'' and inserting ``$500,000,000''.

SEC. 505. REPORTS.

Section 170p. of the Atomic Energy Act of 1954 (42 U.S.C.
2210(p)) is amended by striking ``August 1, 1998'' and
inserting ``August 1, 2008''.

SEC. 506. INFLATION ADJUSTMENT.

Section 170t. of the Atomic Energy Act of 1954 (42 U.S.C.
2210(t)) is amended--
(1) by redesignating paragraph (2) as paragraph (3); and
(2) by adding after paragraph (1) the following:
``(2) The Secretary shall adjust the amount of
indemnification provided under an agreement of
indemnification under subsection d. not less than once during
each 5-year period following July 1, 2002, in accordance with
the aggregate percentage change in the Consumer Price Index
since--
``(A) that date, in the case of the first adjustment under
this paragraph; or

[[Page S10751]]

``(B) the previous adjustment under this paragraph.''.

SEC. 507. CIVIL PENALTIES.

(a) Repeal of Automatic Remission.--Section 234Ab.(2) of
the Atomic Energy Act of 1954 (42 U.S.C. 2282a(b)(2)) is
amended by striking the last sentence.
(b) Limitation for Not-For-Profit Institutions.--Subsection
d. of section 234A of the Atomic Energy Act of 1954 (42
U.S.C. 2282a(d)) is amended to read as follows:
``d.(1) Notwithstanding subsection a., in the case of any
not-for-profit contractor, subcontractor, or supplier, the
total amount of civil penalties assessed under subsection a.
may not exceed the total amount of fees paid within any one-
year period (as determined by the Secretary) under the
contract under which the violation occurs.
``(2) For purposes of this section, the term `not-for-
profit' means that no part of the net earnings of the
contractor, subcontractor, or supplier inures, or may
lawfully inure, to the benefit of any natural person or for-
profit artificial person.''.
(c) Effective Date.--The amendments made by this section
shall not apply to any violation of the Atomic Energy Act of
1954 occurring under a contract entered into before the date
of enactment of this section.

SEC. 508. TREATMENT OF MODULAR REACTORS.

Section 170b. of the Atomic Energy Act of 1954 (42 U.S.C.
2210(b)) is amended by adding at the end the following:
``(5)(A) For purposes of this section only, the Commission
shall consider a combination of facilities described in
subparagraph (B) to be a single facility having a rated
capacity of 100,000 electrical kilowatts or more.
``(B) A combination of facilities referred to in
subparagraph (A) is two or more facilities located at a
single site, each of which has a rated capacity of 100,000
electrical kilowatts or more but not more than 300,000
electrical kilowatts, with a combined rated capacity of not
more than 1,300,000 electrical kilowatts.''.

SEC. 509. EFFECTIVE DATE.

The amendments made by sections 503(a) and 504 do not apply
to any nuclear incident that occurs before the date of the
enactment of this subtitle.

Subtitle B--Miscellaneous Provisions

SEC. 511. URANIUM SALES.

(a) Inventory Sales.--Section 3112(d) of the USEC
Privatization Act (42 U.S.C. 2297h-10(d)) is amended to read
as follows:
``(d) Inventory Sales.--(1) In addition to the transfers
authorized under subsections (b), (c), and (e), the Secretary
may, from time to time, sell or transfer uranium (including
natural uranium concentrates, natural uranium hexafluoride,
enriched uranium, and depleted uranium) from the Department
of Energy's stockpile.
``(2) Except as provided in subsections (b), (c), and (e),
the Secretary may not deliver uranium in any form for
consumption by end users in any year in excess of the
following amounts:

``Annual Maximum Deliveries to End Users

(Million lbs. U<inf>3</inf>O<inf>8</inf>
``Year:                                                   equivalent)
2003 through 2009-.............................................. 3
2010-........................................................... 5
2011-........................................................... 5
2012-........................................................... 7
2013 and each year thereafter-..................................10.
``(3) Except as provided in subsections (b), (c), and (e),
no sale or transfer of uranium in any form shall be made
unless--
``(A) the President determines that the material is not
necessary for national security needs;
``(B) the Secretary determines, based on the written views
of the Secretary of State and the Assistant to the President
for National Security Affairs, that the sale or transfer will
not adversely affect the national security interests of the
United States;
``(C) the Secretary determines that the sale of the
material will not have an adverse material impact on the
domestic uranium mining, conversion, or enrichment industry,
taking into account the sales of uranium under the Russian
HEU Agreement and the Suspension Agreement; and
``(D) the price paid to the Secretary will not be less than
the fair market value of the material.''.
(b) Exempt Transfers and Sales.--Section 3112(e) of the
USEC Privatization Act (42 U.S.C. 2297h-10(e)) is amended to
read as follows:
``(e) Exempt Sales or Transfers.--Notwithstanding
subsection (d)(2), the Secretary may transfer or sell
uranium--
``(1) to the Tennessee Valley Authority for use pursuant to
the Department of Energy's highly enriched uranium or tritium
program, to the extent provided by law;
``(2) to research and test reactors under the University
Reactor Fuel Assistance and Support Program or the Reduced
Enrichment for Research and Test Reactors Program;
``(3) to USEC Inc. to replace contaminated uranium received
from the Department of Energy when the United States
Enrichment Corporation was privatized;
``(4) to any person for emergency purposes in the event of
a disruption in supply to end users in the United States; and
``(5) to any person for national security purposes, as
determined by the Secretary.''.

SEC. 512. REAUTHORIZATION OF THORIUM REIMBURSEMENT.

(a) Reimbursement of Thorium Licensees.--Section
1001(b)(2)(C) of the Energy Policy Act of 1992 (42 U.S.C.
2296a) is amended--
(1) by striking ``$140,000,000'' and inserting
``$365,000,000''; and
(2) by adding at the end the following: ``Such payments
shall not exceed the following amounts:
``(i) $90,000,000 in fiscal year 2002.
``(ii) $55,000,000 in fiscal year 2003.
``(iii) $20,000,000 in fiscal year 2004.
``(iv) $20,000,000 in fiscal year 2005.
``(v) $20,000,000 in fiscal year 2006.
``(vi) $20,000,000 in fiscal year 2007.
Any amounts authorized to be paid in a fiscal year under this
subparagraph that are not paid in that fiscal year may be
paid in subsequent fiscal years.''.
(b) Authorization of Appropriations.--Section 1003(a) of
the Energy Policy Act of 1992 (42 U.S.C. 2296a-2) is amended
by striking ``$490,000,000'' and inserting ``$715,000,000''.
(c) Decontamination and Decommissioning Fund.--Section
1802(a) of the Atomic Energy Act of 1954 (42 U.S.C. 2297g-
1(a)) is amended--
(1) by striking ``$488,333,333'' and inserting
``$518,233,333''; and
(2) by inserting after ``inflation'' the following:
``beginning on the date of enactment of the Energy Policy Act
of 1992''.

SEC. 513. FAST FLUX TEST FACILITY.

The Secretary of Energy shall not reactivate the Fast Flux
Test Facility to conduct--
(1) any atomic energy defense activity,
(2) any space-related mission, or
(3) any program for the production or utilization of
nuclear material if the Secretary has determined, in a record
of decision, that the program can be carried out at existing
operating facilities.

SEC. 514. NUCLEAR POWER 2010.

(a) Definitions.--In this section:
(1) Secretary.--The term ``Secretary'' means the Secretary
of Energy.
(2) Office.--The term ``Office'' means the Office of
Nuclear Energy Science and Technology of the Department of
Energy.
(3) Director.--The term ``Director'' means the Director of
the Office of Nuclear Energy Science and Technology of the
Department of Energy.
(4) Program.--The term ``Program'' means the Nuclear Power
2010 Program.
(b) Establishment.--The Secretary shall carry out a
program, to be managed by the Director.
(c) Purpose.--The program shall aggressively pursue those
activities that will result in regulatory approvals and
design completion in a phased approach, with joint
government/industry cost sharing, which would allow for the
construction and startup of new nuclear plants in the United
States by 2010.
(d) Activities.--In carrying out the program, the Director
shall--
(1) issue a solicitation to industry seeking proposals from
joint venture project teams comprised of reactor vendors and
power generation companies to participate in the Nuclear
Power 2010 program;
(2) seek innovative business arrangements, such as
consortia among designers, constructors, nuclear steam supply
systems and major equipment suppliers, and plant owner/
operators, with strong and common incentives to build and
operate new plants in the United States;
(3) conduct the Nuclear Power 2010 program consistent with
the findings of ``A Roadmap to Deploy New Nuclear Power
Plants in the United States by 2010'' issued by the Near-Term
Deployment Working Group of the Nuclear Energy Research
Advisory Committee of the Department of Energy;
(4) rely upon the expertise and capabilities of the
Department of Energy national laboratories and sites in the
areas of advanced nuclear fuel cycles and fuels testing,
giving consideration to existing lead laboratory designations
and the unique capabilities and facilities available at each
national laboratory and site;
(5) pursue deployment of both water-cooled and gas-cooled
reactor designs on a dual track basis that will provide
maximum potential for the success of both;
(6) include participation of international collaborators in
research and design efforts where beneficial; and
(7) seek to accomplish the essential regulatory and
technical work, both generic and design-specific, to make
possible new nuclear plants within this decade.
(e) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary to carry out the purposes
of this section such sums as are necessary for fiscal year
2003 and for each fiscal year thereafter.

SEC. 515. OFFICE OF SPENT NUCLEAR FUEL RESEARCH.

(a) Findings.--Congress finds that--
(1) before the Federal Government takes any irreversible
action relating to the disposal of spent nuclear fuel,
Congress must determine whether the spent fuel in the
repository should be treated as waste subject to permanent
burial or should be considered an energy resource that is
needed to meet future energy requirements; and
(2) national policy on spent nuclear fuel may evolve with
time as improved technologies for spent fuel are developed or
as national energy needs evolve.
(b) Definitions.--In this section:
(1) Associate director.--The term ``Associate Director''
means the Associate Director of the Office.
(2) Office.--The term ``Office'' means the Office of Spent
Nuclear Fuel Research within the Office of Nuclear Energy
Science and Technology of the Department of Energy.
(c) Establishment.--There is established an Office of Spent
Nuclear Fuel Research within the Office of Nuclear Energy
Science and Technology of the Department of Energy.
(d) Head of Office.--The Office shall be headed by the
Associate Director, who shall be a member of the Senior
Executive Service appointed by the Director of the Office of
Nuclear Energy Science and Technology, and compensated at a
rate determined by applicable law.
(e) Duties of the Associate Director.--

[[Page S10752]]

(1) In general.--The Associate Director shall be
responsible for carrying out an integrated research,
development, and demonstration program on technologies for
treatment, recycling, and disposal of high-level nuclear
radioactive waste and spent nuclear fuel, subject to the
general supervision of the Secretary.
(2) Participation.--The Associate Director shall coordinate
the participation of national laboratories, universities, the
commercial nuclear industry, and other organizations in the
investigation of technologies for the treatment, recycling,
and disposal of spent nuclear fuel and high-level radioactive
waste.
(3) Activities.--The Associate Director shall--
(A) develop a research plan to provide recommendations by
2015;
(B) identify promising technologies for the treatment,
recycling, and disposal of spent nuclear fuel and high-level
radioactive waste;
(C) conduct research and development activities for
promising technologies;
(D) ensure that all activities include as key objectives
minimization of proliferation concerns and risk to the health
of the general public or site workers, as well as development
of cost-effective technologies;
(E) require research on both reactor- and accelerator-based
transmutation systems;
(F) require research on advanced processing and
separations;
(G) include participation of international collaborators in
research efforts, and provide funding to a collaborator that
brings unique capabilities not available in the United States
if the country in which the collaborator is located is unable
to provide for their support; and
(H) ensure that research efforts are coordinated with
research on advanced fuel cycles and reactors conducted by
the Office of Nuclear Energy Science and Technology.
(f) Grant and Contract Authority.--The Secretary may make
grants, or enter into contracts, for the purposes of the
research projects and activities described in this section.
(g) Report.--The Associate Director shall annually submit
to Congress a report on the activities and expenditures of
the Office that describes the progress being made in
achieving the objectives of this section.

SEC. 516. DECOMMISSIONING PILOT PROGRAM.

(a) Pilot Program.--The Secretary of Energy shall establish
a decommissioning pilot program to decommission and
decontaminate the sodium-cooled fast breeder experimental
test-site reactor located in northwest Arkansas in accordance
with the decommissioning activities contained in the August
31, 1998, Department of Energy report on the reactor.
(b) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $16,000,000.

Subtitle C--Growth of Nuclear Energy

SEC. 521. COMBINED LICENSE PERIODS.

Section 103c. of the Atomic Energy Act of 1954 (42 U.S.C.
2133(c)) is amended--
(1) by striking ``c. Each such'' and inserting the
following:
``c. License Period.--
``(1) In general.--Each such''; and
(2) by adding at the end the following:
``(2) Combined licenses.--In the case of a combined
construction and operating license issued under section
185(b), the duration of the operating phase of the license
period shall not be less than the duration of the operating
license if application had been made for separate
construction and operating licenses.''.

Subtitle D--NRC Regulatory Reform

SEC. 531. ANTITRUST REVIEW.

(a) In General.--Section 105 of the Atomic Energy Act of
1954 (42 U.S.C. 2135) is amended by adding at the end the
following:
``d. Antitrust Laws.--
``(1) Notification.--Except as provided in paragraph (4),
when the Commission proposes to issue a license under section
103 or 104b., the Commission shall notify the Attorney
General of the proposed license and the proposed terms and
conditions of the license.
``(2) Action by the attorney general.--Within a reasonable
time (but not more than 90 days) after receiving notification
under paragraph (1), the Attorney General shall submit to the
Commission and publish in the Federal Register a
determination whether, insofar as the Attorney General is
able to determine, the proposed license would tend to create
or maintain a situation inconsistent with the antitrust laws.
``(3) Information.--On the request of the Attorney General,
the Commission shall furnish or cause to be furnished such
information as the Attorney General determines to be
appropriate or necessary to enable the Attorney General to
make the determination under paragraph (2).
``(4) Applicability.--This subsection shall not apply to
such classes or type of licenses as the Commission, with the
approval of the Attorney General, determines would not
significantly affect the activities of a licensee under the
antitrust laws.''.
(b) Conforming Amendment.--Section 105c. of the Atomic
Energy Act of 1954 (42 U.S.C. 2135(c)) is amended by adding
at the end the following:
``(9) Applicability.--This subsection does not apply to an
application for a license to construct or operate a
utilization facility under section 103 or 104b. that is filed
on or after the date of enactment of subsection d.''.

SEC. 532. DECOMMISSIONING.

(a) Authority Over Former Licensees for Decommissioning
Funding.--Section 161i. of the Atomic Energy Act of 1954 (42
U.S.C. 2201(i)) is amended--
(1) by striking ``and (3)'' and inserting ``(3)''; and
(2) by inserting before the semicolon at the end the
following: ``, and (4) to ensure that sufficient funds will
be available for the decommissioning of any production or
utilization facility licensed under section 103 or 104b.,
including standards and restrictions governing the control,
maintenance, use, and disbursement by any former licensee
under this Act that has control over any fund for the
decommissioning of the facility''.
(b) Treatment of Nuclear Reactor Financial Obligations.--
Section 523 of title 11, United States Code, is amended by
adding at the end the following:
``(f) Treatment of Nuclear Reactor Financial Obligations.--
Notwithstanding any other provision of this title--
``(1) any funds or other assets held by a licensee or
former licensee of the Nuclear Regulatory Commission, or by
any other person, to satisfy the responsibility of the
licensee, former licensee, or any other person to comply with
a regulation or order of the Nuclear Regulatory Commission
governing the decontamination and decommissioning of a
nuclear power reactor licensed under section 103 or 104b. of
the Atomic Energy Act of 1954 (42 U.S.C. 2133, 2134(b)) shall
not be used to satisfy the claim of any creditor in any
proceeding under this title, other than a claim resulting
from an activity undertaken to satisfy that responsibility,
until the decontamination and decommissioning of the nuclear
power reactor is completed to the satisfaction of the Nuclear
Regulatory Commission;
``(2) obligations of licensees, former licensees, or any
other person to use funds or other assets to satisfy a
responsibility described in paragraph (1) may not be
rejected, avoided, or discharged in any proceeding under this
title or in any liquidation, reorganization, receivership, or
other insolvency proceeding under Federal or State law; and
``(3) private insurance premiums and standard deferred
premiums held and maintained in accordance with section 170b.
of the Atomic Energy Act of 1954 (42 U.S.C. 2210(b)) shall
not be used to satisfy the claim of any creditor in any
proceeding under this title, until the indemnification
agreement executed in accordance with section 170c. of that
Act (42 U.S.C. 2210(c)) is terminated.''.

Subtitle E--NRC Personnel Crisis

SEC. 541. ELIMINATION OF PENSION OFFSET.

Section 161 of the Atomic Energy Act of 1954 (42 U.S.C.
2201) is amended by adding at the end the following:
``y. exempt from the application of sections 8344 and 8468
of title 5, United States Code, an annuitant who was formerly
an employee of the Commission who is hired by the Commission
as a consultant, if the Commission finds that the annuitant
has a skill that is critical to the performance of the duties
of the Commission.''.

SEC. 542. NRC TRAINING PROGRAM.

(a) In General.--In order to maintain the human resource
investment and infrastructure of the United States in the
nuclear sciences, health physics, and engineering fields, in
accordance with the statutory authorities of the Commission
relating to the civilian nuclear energy program, the Nuclear
Regulatory Commission shall carry out a training and
fellowship program to address shortages of individuals with
critical safety skills.
(b) Authorization of Appropriations.--
(1) In general.--There are authorized to be appropriated to
carry out this section $1,000,000 for each of fiscal years
2003 through 2006.
(2) Availability.--Funds made available under paragraph (1)
shall remain available until expended.

DIVISION B--DOMESTIC OIL AND GAS PRODUCTION AND TRANSPORTATION

TITLE VI--OIL AND GAS PRODUCTION

SEC. 601. PERMANENT AUTHORITY TO OPERATE THE STRATEGIC
PETROLEUM RESERVE.

(a) Amendment to Title I of the Energy Policy and
Conservation Act.--Title I of the Energy Policy and
Conservation Act (42 U.S.C. 6211 et seq.) is amended--
(1) by striking section 166 (42 U.S.C. 6246) and
inserting--
``Sec. 166. There are authorized to be appropriated to the
Secretary such sums as may be necessary to carry out this
part, to remain available until expended.''; and
(2) by striking part E (42 U.S.C. 6251; relating to the
expiration of title I of the Act) and its heading.
(b) Amendment to Title II of the Energy Policy and
Conservation Act.--Title II of the Energy Policy and
Conservation Act (42 U.S.C. 6271 et seq.) is amended--
(1) by striking section 256(h) (42 U.S.C. 6276(h)) and
inserting--
``(h) Authorization of Appropriations.--There are
authorized to be appropriated to the Secretary such sums as
may be necessary to carry out this part, to remain available
until expended.'';
(2) by striking section 273(e) (42 U.S.C. 6283(e); relating
to the expiration of summer fill and fuel budgeting
programs); and
(3) by striking part D (42 U.S.C. 6285; relating to the
expiration of title II of the Act) and its heading.
(c) Technical Amendments.--The table of contents for the
Energy Policy and Conservation Act is amended by striking the
items relating to part D of title I and part D of title II.

SEC. 602. FEDERAL ONSHORE LEASING PROGRAMS FOR OIL AND GAS.

(a) Timely Action on Leases and Permits.--To ensure timely
action on oil and gas leases and applications for permits to
drill on lands otherwise available for leasing, the Secretary
of the Interior shall--
(1) ensure expeditious compliance with the requirements of
section 102(2)(C) of the National Environmental Policy Act of
1969 (42 U.S.C. 4332(2)(C));

[[Page S10753]]

(2) improve consultation and coordination with the States;
and
(3) improve the collection, storage, and retrieval of
information related to such leasing activities.
(b) Improved Enforcement.--The Secretary shall improve
inspection and enforcement of oil and gas activities,
including enforcement of terms and conditions in permits to
drill.
(c) Authorization of Appropriations.--For each of the
fiscal years 2003 through 2006, in addition to amounts
otherwise authorized to be appropriated for the purpose of
carrying out section 17 of the Mineral Leasing Act (30 U.S.C.
226), there are authorized to be appropriated to the
Secretary of the Interior--
(1) $40,000,000 for the purpose of carrying out paragraphs
(1) through (3) of subsection (a); and
(2) $20,000,000 for the purpose of carrying out subsection
(b).

SEC. 603. OIL AND GAS LEASE ACREAGE LIMITATIONS.

Section 27(d)(1) of the Mineral Leasing Act (30 U.S.C.
184(d)(1)) is amended by inserting after ``acreage held in
special tar sand areas'' the following: ``as well as acreage
under any lease any portion of which has been committed to a
federally approved unit or cooperative plan or
communitization agreement, or for which royalty, including
compensatory royalty or royalty in kind, was paid in the
preceding calendar year,''.

SEC. 604. ORPHANED AND ABANDONED WELLS ON FEDERAL LAND.

(a) Establishment.--(1) The Secretary of the Interior, in
cooperation with the Secretary of Agriculture, shall
establish a program to ensure within 3 years after the date
of enactment of this Act, remediation, reclamation, and
closure of orphaned oil and gas wells located on lands
administered by the land management agencies within the
Department of the Interior and the United States Forest
Service that are--
(A) abandoned;
(B) orphaned; or
(C) idled for more than 5 years and having no beneficial
use.
(2) The program shall include a means of ranking critical
sites for priority in remediation based on potential
environmental harm, other land use priorities, and public
health and safety.
(3) The program shall provide that responsible parties be
identified wherever possible and that the costs of
remediation be recovered.
(4) In carrying out the program, the Secretary of the
Interior shall work cooperatively with the Secretary of
Agriculture and the States within which the Federal lands are
located, and shall consult with the Secretary of Energy, and
the Interstate Oil and Gas Compact Commission.
(b) Plan.--Within 6 months from the date of enactment of
this section, the Secretary of the Interior, in cooperation
with the Secretary of Agriculture, shall prepare a plan for
carrying out the program established under subsection (a).
Copies of the plan shall be transmitted to the Committee on
Energy and Natural Resources of the Senate and the Committee
on Resources of the House of Representatives.
(c) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary of the Interior
$5,000,000 for each of fiscal years 2003 through 2005 to
carry out the activities provided for in this section.

SEC. 605. ORPHANED AND ABANDONED OIL AND GAS WELL PROGRAM.

(a) Establishment.--The Secretary of Energy shall establish
a program to provide technical assistance to the various oil
and gas producing States to facilitate State efforts over a
10-year period to ensure a practical and economical remedy
for environmental problems caused by orphaned and abandoned
exploration or production well sites on State and private
lands. The Secretary shall work with the States, through the
Interstate Oil and Gas Compact Commission, to assist the
States in quantifying and mitigating environmental risks of
onshore abandoned and orphaned wells on State and private
lands.
(b) Program Elements.--The program should include--
(1) mechanisms to facilitate identification of responsible
parties wherever possible;
(2) criteria for ranking critical sites based on factors
such as other land use priorities, potential environmental
harm and public visibility; and
(3) information and training programs on best practices for
remediation of different types of sites.
(c) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary of Energy for the
activities under this section $5,000,000 for each of fiscal
years 2003 through 2005 to carry out the provisions of this
section.

SEC. 606. OFFSHORE DEVELOPMENT.

Section 5 of the Outer Continental Shelf Lands Act of 1953
(43 U.S.C. 1334) is amended by adding at the end the
following:
``(k) Suspension of Operations for Subsalt Exploration.--
Notwithstanding any other provision of law or regulation, the
Secretary may grant a request for a suspension of operations
under any lease to allow the lessee to reprocess or
reinterpret geologic or geophysical data beneath allocthonous
salt sheets, when in the Secretary's judgment such suspension
is necessary to prevent waste caused by the drilling of
unnecessary wells, and to maximize ultimate recovery of
hydrocarbon resources under the lease. Such suspension shall
be limited to the minimum period of time the Secretary
determines is necessary to achieve the objectives of this
subsection.''.

SEC. 607. COALBED METHANE STUDY.

(a) Study.--The National Academy of Sciences shall conduct
a study on the effects of coalbed methane production on
surface and water resources.
(b) Data Analysis.--The study shall analyze available
hydrogeologic and water quality data, along with other
pertinent environmental or other information to determine--
(1) adverse effects associated with surface or subsurface
disposal of waters produced during extraction of coalbed
methane;
(2) depletion of groundwater aquifers or drinking water
sources associated with production of coalbed methane;
(3) any other significant adverse impacts to surface or
water resources associated with production of coalbed
methane; and
(4) production techniques or other factors that can
mitigate adverse impacts from coalbed methane development.
(c) Recommendations.--The study shall analyze existing
Federal and State laws and regulations, and make
recommendations as to changes, if any, to Federal law
necessary to address adverse impacts to surface or water
resources attributable to coalbed methane development.
(d) Completion of Study.--The National Academy of Sciences
shall submit the study to the Secretary of the Interior
within 18 months after the date of enactment of this Act, and
shall make the study available to the public at the same
time.
(e) Report to Congress.--The Secretary of the Interior
shall report to Congress within 6 months of her receipt of
the study on--
(1) the findings and recommendations of the study;
(2) the Secretary's agreement or disagreement with each of
its findings and recommendations; and
(3) any recommended changes in funding to address the
effects of coalbed methane production on surface and water
resources.

SEC. 608. FISCAL POLICIES TO MAXIMIZE RECOVERY OF DOMESTIC
OIL AND GAS RESOURCES.

(a) Evaluation.--The Secretary of Energy, in coordination
with the Secretaries of the Interior, Commerce, and Treasury,
Indian tribes and the Interstate Oil and Gas Compact
Commission, shall evaluate the impact of existing Federal and
State tax and royalty policies on the development of domestic
oil and gas resources and on revenues to Federal, State,
local and tribal governments.
(b) Scope.--The evaluation under subsection (a) shall--
(1) analyze the impact of fiscal policies on oil and
natural gas exploration, development drilling, and production
under different price scenarios, including the impact of the
individual and corporate Alternative Minimum Tax, State and
local production taxes and fixed royalty rates during low
price periods;
(2) assess the effect of existing Federal and State fiscal
policies on investment under different geological and
developmental circumstances, including but not limited to
deepwater environments, subsalt formations, deep and deviated
wells, coalbed methane and other unconventional oil and gas
formations;
(3) assess the extent to which Federal and State fiscal
policies negatively impact the ultimate recovery of resources
from existing fields and smaller accumulations in offshore
waters, especially in water depths less than 800 meters, of
the Gulf of Mexico;
(4) compare existing Federal and State policies with tax
and royalty regimes in other countries with particular
emphasis on similar geological, developmental and
infrastructure conditions; and
(5) evaluate how alternative tax and royalty policies,
including counter-cyclical measures, could increase recovery
of domestic oil and natural gas resources and revenues to
Federal, State, local and tribal governments.
(c) Policy Recommendations.--Based upon the findings of the
evaluation under subsection (a), a report describing the
findings and recommendations for policy changes shall be
provided to the President, the Congress, the Governors of the
member States of the Interstate Oil and Gas Compact
Commission, and Indian tribes having an oil and gas lease
approved by the Secretary of the Interior. The
recommendations should ensure that the public interest in
receiving the economic benefits of tax and royalty revenues
is balanced with the broader national security and economic
interests in maximizing recovery of domestic resources. The
report should include recommendations regarding actions to--
(1) ensure stable development drilling during periods of
low oil and/or natural gas prices to maintain reserve
replacement and deliverability;
(2) minimize the negative impact of a volatile investment
climate on the oil and gas service industry and domestic oil
and gas exploration and production;
(3) ensure a consistent level of domestic activity to
encourage the education and retention of a technical
workforce; and
(4) maintain production capability during periods of low
oil and/or natural gas prices.
(d) Royalty Guidelines.--The recommendations required under
(c) should include guidelines for private resource holders as
to the appropriate level of royalties given geology,
development cost, and the national interest in maximizing
recovery of oil and gas resources.
(e) Report.--The study under subsection (a) shall be
completed not later than 18 months after the date of
enactment of this section. The report and recommendations
required in (c) shall be transmitted to the President, the
Congress, Indian tribes, and the Governors of the member
States of the Interstate Oil and Gas Compact Commission.

SEC. 609. STRATEGIC PETROLEUM RESERVE.

(a) Full Capacity.--The President shall--
(1) fill the Strategic Petroleum Reserve established
pursuant to part B of title I of the Energy

[[Page S10754]]

Policy and Conservation Act (42 U.S.C. 6231 et seq.) to full
capacity as soon as practicable;
(2) acquire petroleum for the Strategic Petroleum Reserve
by the most practicable and cost-effective means, including
the acquisition of crude oil the United States is entitled to
receive in kind as royalties from production on Federal
lands; and
(3) ensure that the fill rate minimizes impacts on
petroleum markets.
(b) Recommendations.--Not later than 180 days after the
date of enactment of this Act, the Secretary of Energy shall
submit to Congress a plan to--
(1) eliminate any infrastructure impediments that may limit
maximum drawdown capability; and
(2) determine whether the capacity of the Strategic
Petroleum Reserve on the date of enactment of this section is
adequate in light of the increasing consumption of petroleum
and the reliance on imported petroleum.

SEC. 610. HYDRAULIC FRACTURING.

Section 1421 of the Safe Drinking Water Act (42 U.S.C.
300h) is amended by adding at the end the following:
``(e) Hydraulic Fracturing for Oil and Gas Production.--
``(1) Study of the effects of hydraulic fracturing.--
``(A) In general.--As soon as practicable, but in no event
later than 24 months after the date of enactment of this
subsection, the Administrator shall complete a study of the
known and potential effects on underground drinking water
sources of hydraulic fracturing, including the effects of
hydraulic fracturing on underground drinking water sources on
a nationwide basis, and within specific regions, States, or
portions of States.
``(B) Consultation.--In planning and conducting the study,
the Administrator shall consult with the Secretary of the
Interior, the Secretary of Energy, the Ground Water
Protection Council, affected States, and, as appropriate,
representatives of environmental, industry, academic,
scientific, public health, and other relevant organizations.
Such study may be accomplished in conjunction with other
ongoing studies related to the effects of oil and gas
production on groundwater resources.
``(C) Study elements.--The study conducted under
subparagraph (A) shall, at a minimum, examine and make
findings as to whether--
``(i) such hydraulic fracturing has endangered or will
endanger (as defined under subsection (d)(2)) underground
drinking water sources, including those sources within
specific regions, States or portions of States;
``(ii) there are specific methods, practices, or
hydrogeologic circumstances in which hydraulic fracturing has
endangered or will endanger underground drinking water
sources; and
``(iii) there are any precautionary actions that may reduce
or eliminate any such endangerment.
``(D) Study of hydraulic fracturing in a particular type of
geologic formation.--The Administrator may also complete a
separate study on the known and potential effects on
underground drinking water sources of hydraulic fracturing in
a particular type of geologic formation:
``(i) If such a study is undertaken, the Administrator
shall follow the procedures for study preparation and
independent scientific review set forth in subparagraphs (1)
(B) and (C) and (2) of this subsection. The Administrator may
complete this separate study prior to the completion of the
broader study of hydraulic fracturing required pursuant to
subparagraph (A) of this subsection.
``(ii) At the conclusion of independent scientific review
for any separate study, the Administrator shall determine,
pursuant to paragraph (3), whether regulation of hydraulic
fracturing in the particular type of geologic formation
addressed in the separate study is necessary under this part
to ensure that underground sources of drinking water will not
be endangered on a nationwide basis, or within a specific
region, State or portions of a State. Subparagraph (4) of
this subsection shall apply to any such determination by the
Administrator.
``(iii) If the Administrator completes a separate study,
the Administrator may use the information gathered in the
course of such a study in undertaking her broad study to the
extent appropriate. The broader study need not include a
reexamination of the conclusions reached by the Administrator
in any separate study.
``(2) Independent scientific review.--
``(A) In general.--Prior to the time the study under
paragraph (1) is completed, the Administrator shall enter
into an appropriate agreement with the National Academy of
Sciences to have the Academy review the conclusions of the
study.
``(B) Report.--Not later than 11 months after entering into
an appropriate agreement with the Administrator, the National
Academy of Sciences shall report to the Administrator, the
Committee on Energy and Commerce of the House of
Representatives, and the Committee on Environment and Public
Works of the Senate, on the--
``(i) findings related to the study conducted by the
Administrator under paragraph (1);
``(ii) the scientific and technical basis for such
findings; and
``(iii) recommendations, if any, for modifying the findings
of the study.
``(3) Regulatory determination.--
``(A) In general.--Not later than 6 months after receiving
the National Academy of Sciences report under paragraph (2),
the Administrator shall determine, after informal public
hearings and public notice and opportunity for comment, and
based on information developed or accumulated in connection
with the study required under paragraph (1) and the National
Academy of Sciences report under paragraph (2), either--
``(i) that regulation of hydraulic fracturing under this
part is necessary to ensure that underground sources of
drinking water will not be endangered on a nationwide basis,
or within a specific region, State or portions of a State; or
``(ii) that regulation described under clause (i) is
unnecessary.
``(B) Publication of determination.--The Administrator
shall publish the determination in the Federal Register,
accompanied by an explanation and the reasons for it.
``(4) Promulgation of regulations.--
``(A) Regulation necessary.--If the Administrator
determines under paragraph (3) that regulation by hydraulic
fracturing under this part is necessary to ensure that
hydraulic fracturing does not endanger underground drinking
water sources on a nationwide basis, or within a specific
region, State or portions of a State, the Administrator
shall, within 6 months after the issuance of that
determination, and after public notice and opportunity for
comment, promulgate regulations under section 1421 (42 U.S.C.
300h) to ensure that hydraulic fracturing will not endanger
such underground sources of drinking water. However, for
purposes of the Administrator's approval or disapproval under
section 1422 of any State underground injection control
program for regulating hydraulic fracturing, a State at any
time may make the alternative demonstration provided for in
section 1425 of this title.
``(B) Regulation unnecessary.--The Administrator shall not
regulate or require States to regulate hydraulic fracturing
under this part unless the Administrator determines under
paragraph (3) that such regulation is necessary. This
provision shall not apply to any State which has a program
for the regulation of hydraulic fracturing that was approved
by the Administrator under this part prior to the effective
date of this subsection.
``(C) Existing regulations.--A determination by the
Administrator under paragraph (3) that regulation is
unnecessary will relieve all States (including those with
existing approved programs for the regulation of hydraulic
fracturing) from any further obligation to regulate hydraulic
fracturing as an underground injection under this part.
``(5) Definition of hydraulic fracturing.--For purposes of
this subsection, the term `hydraulic fracturing' means the
process of creating a fracture in a reservoir rock, and
injecting fluids and propping agents, for the purposes of
reservoir stimulation related to oil and gas production
activities.
``(6) Savings.--Nothing in this subsection shall in any way
limit the authorities of the Administrator under section 1431
(42 U.S.C. 300i).''.

SEC. 611. AUTHORIZATION OF APPROPRIATIONS.

There are authorized to be appropriated to the
Administrator of the Environmental Protection Agency $100,000
for fiscal year 2003, to remain available until expended, for
a grant to the State of Alabama to assist in the
implementation of its regulatory program under section 1425
of the Safe Drinking Water Act.

SEC. 612. PRESERVATION OF OIL AND GAS RESOURCE DATA.

The Secretary of the Interior, through the United States
Geological Survey, may enter into appropriate arrangements
with State agencies that conduct geological survey activities
to collect, archive, and provide public access to data and
study results regarding oil and natural gas resources. The
Secretary may accept private contributions of property and
services for purposes of this section.

SEC 613. RESOLUTION OF FEDERAL RESOURCE DEVELOPMENT CONFLICTS
IN THE POWDER RIVER BASIN.

The Secretary of the Interior shall undertake a review of
existing authorities to resolve conflicts between the
development of Federal coal and the development of Federal
and non-Federal coalbed methane in the Powder River Basin in
Wyoming and Montana. Not later than 90 days from enactment of
this Act, the Secretary shall report to Congress on her plan
to resolve these conflicts.

TITLE VII--NATURAL GAS PIPELINES

Subtitle A--Alaska Natural Gas Pipeline

SEC. 701. SHORT TITLE.

This subtitle may be cited as the ``Alaska Natural Gas
Pipeline Act of 2003''.

SEC. 702. FINDINGS.

The Congress finds that:
(1) Construction of a natural gas pipeline system from the
Alaskan North Slope to United States markets is in the
national interest and will enhance national energy security
by providing access to the significant gas reserves in Alaska
needed to meet the anticipated demand for natural gas.
(2) The Commission issued a conditional certificate of
public convenience and necessity for the Alaska Natural Gas
Transportation System, which remains in effect.

SEC. 703. PURPOSES.

The purposes of this subtitle are--
(1) to provide a statutory framework for the expedited
approval, construction, and initial operation of an Alaska
natural gas transportation project, as an alternative to the
framework provided in the Alaska Natural Gas Transportation
Act of 1976 (15 U.S.C. 719-719o), which remains in effect;
(2) to establish a process for providing access to such
transportation project in order to promote competition in the
exploration, development and production of Alaska natural
gas;
(3) to clarify Federal authorities under the Alaska Natural
Gas Transportation Act; and
(4) to authorize Federal financial assistance to an Alaska
natural gas transportation project as provided in this
subtitle.

[[Page S10755]]

SEC. 704. ISSUANCE OF CERTIFICATE OF PUBLIC CONVENIENCE AND
NECESSITY.

(a) Authority of the Commission.--Notwithstanding the
provisions of the Alaska Natural Gas Transportation Act of
1976 (15 U.S.C. 719-719o), the Commission may, pursuant to
section 7(c) of the Natural Gas Act (15 U.S.C. 717f(c)),
consider and act on an application for the issuance of a
certificate of public convenience and necessity authorizing
the construction and operation of an Alaska natural gas
transportation project other than the Alaska Natural Gas
Transportation System.
(b) Issuance of Certificate.--(1) The Commission shall
issue a certificate of public convenience and necessity
authorizing the construction and operation of an Alaska
natural gas transportation project under this section if the
applicant has satisfied the requirements of section 7(e) of
the Natural Gas Act (15 U.S.C. 717f(e)).
(2) In considering an application under this section, the
Commission shall presume that--
(A) a public need exists to construct and operate the
proposed Alaska natural gas transportation project; and
(B) sufficient downstream capacity will exist to transport
the Alaska natural gas moving through such project to markets
in the contiguous United States.
(c) Expedited Approval Process.--The Commission shall issue
a final order granting or denying any application for a
certificate of public convenience and necessity under section
7(c) of the Natural Gas Act (15 U.S.C. 717f(c)) and this
section not more than 60 days after the issuance of the final
environmental impact statement for that project pursuant to
section 705.
(d) Prohibition on Certain Pipeline Route.--No license,
permit, lease, right-of-way, authorization or other approval
required under Federal law for the construction of any
pipeline to transport natural gas from lands within the
Prudhoe Bay oil and gas lease area may be granted for any
pipeline that follows a route that traverses--
(1) the submerged lands (as defined by the Submerged Lands
Act) beneath, or the adjacent shoreline of, the Beaufort Sea;
and
(2) enters Canada at any point north of 68 degrees North
latitude.
(e) Open Season.--Except where an expansion is ordered
pursuant to section 706, initial or expansion capacity on any
Alaska natural gas transportation project shall be allocated
in accordance with procedures to be established by the
Commission in regulations governing the conduct of open
seasons for such project. Such procedures shall include the
criteria for and timing of any open seasons, be consistent
with the purposes set forth in section 703(2) and, for any
open season for capacity beyond the initial capacity, provide
the opportunity for the transportation of natural gas other
than from the Prudhoe Bay and Point Thompson units. The
Commission shall issue such regulations no later than 120
days after the enactment of this subtitle.
(f) Projects in the Contiguous United States.--Applications
for additional or expanded pipeline facilities that may be
required to transport Alaska natural gas from Canada to
markets in the contiguous United States may be made pursuant
to the Natural Gas Act. To the extent such pipeline
facilities include the expansion of any facility constructed
pursuant to the Alaska Natural Gas Transportation Act of
1976, the provisions of that Act shall continue to apply.
(g) Study of In-State Needs.--The holder of the certificate
of public convenience and necessity issued, modified, or
amended by the Commission for an Alaska natural gas
transportation project shall demonstrate that it has
conducted a study of Alaska in-State needs, including tie-in
points along the Alaska natural gas transportation project
for in-State access.
(h) Alaska Royalty Gas.--The Commission, upon the request
of the State of Alaska and after a hearing, may provide for
reasonable access to the Alaska natural gas transportation
project for the State of Alaska or its designee for the
transportation of the State's royalty gas for local
consumption needs within the State: Provided, That the rates
of existing shippers of subscribed capacity on such project
shall not be increased as a result of such access.
(i) Regulations.--The Commission may issue regulations to
carry out the provisions of this section.

SEC. 705. ENVIRONMENTAL REVIEWS.

(a) Compliance With NEPA.--The issuance of a certificate of
public convenience and necessity authorizing the construction
and operation of any Alaska natural gas transportation
project under section 704 shall be treated as a major Federal
action significantly affecting the quality of the human
environment within the meaning of section 102(2)(C) of the
National Environmental Policy Act of 1969 (42 U.S.C.
4332(2)(C)).
(b) Designation of Lead Agency.--The Commission shall be
the lead agency for purposes of complying with the National
Environmental Policy Act of 1969, and shall be responsible
for preparing the statement required by section 102(2)(c) of
that Act (42 U.S.C. 4332(2)(c)) with respect to an Alaska
natural gas transportation project under section 704. The
Commission shall prepare a single environmental statement
under this section, which shall consolidate the environmental
reviews of all Federal agencies considering any aspect of the
project.
(c) Other Agencies.--All Federal agencies considering
aspects of the construction and operation of an Alaska
natural gas transportation project under section 704 shall
cooperate with the Commission, and shall comply with
deadlines established by the Commission in the preparation of
the statement under this section. The statement prepared
under this section shall be used by all such agencies to
satisfy their responsibilities under section 102(2)(C) of the
National Environmental Policy Act of 1969 (42 U.S.C.
4332(2)(C)) with respect to such project.
(d) Expedited Process.--The Commission shall issue a draft
statement under this section not later than 12 months after
the Commission determines the application to be complete and
shall issue the final statement not later than 6 months after
the Commission issues the draft statement, unless the
Commission for good cause finds that additional time is
needed.

SEC. 706. PIPELINE EXPANSION.

(a) Authority.--With respect to any Alaska natural gas
transportation project, upon the request of one or more
persons and after giving notice and an opportunity for a
hearing, the Commission may order the expansion of such
project if it determines that such expansion is required by
the present and future public convenience and necessity.
(b) Requirements.--Before ordering an expansion the
Commission shall--
(1) approve or establish rates for the expansion service
that are designed to ensure the recovery, on an incremental
or rolled-in basis, of the cost associated with the expansion
(including a reasonable rate of return on investment);
(2) ensure that the rates as established do not require
existing shippers on the Alaska natural gas transportation
project to subsidize expansion shippers;
(3) find that the proposed shipper will comply with, and
the proposed expansion and the expansion of service will be
undertaken and implemented based on, terms and conditions
consistent with the then-effective tariff of the Alaska
natural gas transportation project;
(4) find that the proposed facilities will not adversely
affect the financial or economic viability of the Alaska
natural gas transportation project;
(5) find that the proposed facilities will not adversely
affect the overall operations of the Alaska natural gas
transportation project;
(6) find that the proposed facilities will not diminish the
contract rights of existing shippers to previously subscribed
certificated capacity;
(7) ensure that all necessary environmental reviews have
been completed; and
(8) find that adequate downstream facilities exist or are
expected to exist to deliver incremental Alaska natural gas
to market.
(c) Requirement for a Firm Transportation Agreement.--Any
order of the Commission issued pursuant to this section shall
be null and void unless the person or persons requesting the
order executes a firm transportation agreement with the
Alaska natural gas transportation project within a reasonable
period of time as specified in such order.
(d) Limitation.--Nothing in this section shall be construed
to expand or otherwise affect any authorities of the
Commission with respect to any natural gas pipeline located
outside the State of Alaska.
(e) Regulations.--The Commission may issue regulations to
carry out the provisions of this section.

SEC. 707. FEDERAL COORDINATOR.

(a) Establishment.--There is established as an independent
establishment in the executive branch, the Office of the
Federal Coordinator for Alaska Natural Gas Transportation
Projects.
(b) The Federal Coordinator.--The Office shall be headed by
a Federal Coordinator for Alaska Natural Gas Transportation
Projects, who shall--
(1) be appointed by the President, by and with the advice
of the Senate,
(2) hold office at the pleasure of the President, and
(3) be compensated at the rate prescribed for level III of
the Executive Schedule (5 U.S.C. 5314).
(c) Duties.--The Federal Coordinator shall be responsible
for--
(1) coordinating the expeditious discharge of all
activities by Federal agencies with respect to an Alaska
natural gas transportation project; and
(2) ensuring the compliance of Federal agencies with the
provisions of this subtitle.
(d) Reviews and Actions of Other Federal Agencies.--(1) All
reviews conducted and actions taken by any Federal officer or
agency relating to an Alaska natural gas transportation
project authorized under this section shall be expedited, in
a manner consistent with completion of the necessary reviews
and approvals by the deadlines set forth in this subtitle.
(2) No Federal officer or agency shall have the authority
to include terms and conditions that are permitted, but not
required, by law on any certificate, right-of-way, permit,
lease or other authorization issued to an Alaska natural gas
transportation project if the Federal Coordinator determines
that the terms and conditions would prevent or impair in any
significant respect the expeditious construction and
operation of the project.
(3) Unless required by law, no Federal officer or agency
shall add to, amend, or abrogate any certificate, right-of-
way, permit, lease or other authorization issued to an Alaska
natural gas transportation project if the Federal Coordinator
determines that such action would prevent or impair in any
significant respect the expeditious construction and
operation of the project.
(e) State Coordination.--The Federal Coordinator shall
enter into a Joint Surveillance and Monitoring Agreement,
approved by the President and the Governor of Alaska, with
the State of Alaska similar to that in effect during
construction of the Trans-Alaska Oil Pipeline to monitor the
construction of the Alaska natural gas transportation
project. The Federal Government shall have primary
surveillance and monitoring responsibility where the Alaska
natural gas transportation project crosses Federal lands and
private lands, and the State government

[[Page S10756]]

shall have primary surveillance and monitoring responsibility
where the Alaska natural gas transportation project crosses
State lands.

SEC. 708. JUDICIAL REVIEW.

(a) Exclusive Jurisdiction.--The United States Court of
Appeals for the District of Columbia Circuit shall have
exclusive jurisdiction to determine--
(1) the validity of any final order or action (including a
failure to act) of any Federal agency or officer under this
subtitle;
(2) the constitutionality of any provision of this
subtitle, or any decision made or action taken thereunder; or
(3) the adequacy of any environmental impact statement
prepared under the National Environmental Policy Act of 1969
with respect to any action under this subtitle.
(b) Deadline for Filing Claim.--Claims arising under this
subtitle may be brought not later than 60 days after the date
of the decision or action giving rise to the claim.
(c) Expedited Consideration.--The United States Court of
Appeals for the District of Columbia Circuit shall set any
action brought under subsection (a) of this section for
expedited consideration, taking into account the national
interest as described in section 702 of this subtitle.
(d) Amendment to ANGTA.--Section 10(c) of the Alaska Gas
Transportation Act of 1976 (15 U.S.C. 719h) is amended by
adding the following paragraph:
``(2) Expedited consideration.--The United States Court of
Appeals for the District of Columbia Circuit shall set any
action brought under subsection (a) of this section for
expedited consideration, taking into account the national
interest described in section 2 of this Act.''.

SEC. 709. STATE JURISDICTION OVER IN-STATE DELIVERY OF
NATURAL GAS.

(a) Local Distribution.--Any facility receiving natural gas
from the Alaska natural gas transportation project for
delivery to consumers within the State of Alaska shall be
deemed to be a local distribution facility within the meaning
of section 1(b) of the Natural Gas Act (15 U.S.C. 717), and
therefore not subject to the jurisdiction of the Federal
Energy Regulatory Commission.
(b) Additional Pipelines.--Nothing in this subtitle, except
as provided in subsection 704(d), shall preclude or affect a
future gas pipeline that may be constructed to deliver
natural gas to Fairbanks, Anchorage, Matanuska-Susitna
Valley, or the Kenai peninsula or Valdez or any other site in
the State of Alaska for consumption within or distribution
outside the State of Alaska.
(c) Rate Coordination.--Pursuant to the Natural Gas Act,
the Commission shall establish rates for the transportation
of natural gas on the Alaska natural gas transportation
project. In exercising such authority, the Commission,
pursuant to Section 17(b) of the Natural Gas Act (15 U.S.C.
717p), shall confer with the State of Alaska regarding rates
(including rate settlements) applicable to natural gas
transported on and delivered from the Alaska natural gas
transportation project for use within the State of Alaska.

SEC. 710. LOAN GUARANTEE.

(a) Authority.--The Secretary of Energy may guarantee not
more than 80 percent of the principal of any loan made to the
holder of a certificate of public convenience and necessity
issued under section 704(b) of this Act or section 9 of the
Alaska Natural Gas Transportation Act of 1976 (15 U.S.C.
719g) for the purpose of constructing an Alaska natural gas
transportation project.
(b) Conditions.--(1) The Secretary of Energy may not
guarantee a loan under this section unless the guarantee has
filed an application for a certificate of public convenience
and necessity under section 704(b) of this Act or for an
amended certificate under section 9 of the Alaska Natural Gas
Transportation Act of 1976 (15 U.S.C. 719g) with the
Commission not later than 18 months after the date of
enactment of this subtitle.
(2) A loan guaranteed under this section shall be made by a
financial institution subject to the examination of the
Secretary.
(3) Loan requirements, including term, maximum size,
collateral requirements and other features shall be
determined by the Secretary.
(c) Limitation on Amount.--Commitments to guarantee loans
may be made by the Secretary of Energy only to the extent
that the total loan principal, any part of which is
guaranteed, will not exceed $10,000,000,000.
(d) Regulations.--The Secretary of Energy may issue
regulations to carry out the provisions of this section.
(e) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary such sums as may be
necessary to cover the cost of loan guarantees, as defined by
section 502(5) of the Federal Credit Reform Act of 1990 (2
U.S.C. 661a(5)).

SEC. 711. STUDY OF ALTERNATIVE MEANS OF CONSTRUCTION.

(a) Requirement of Study.--If no application for the
issuance of a certificate or amended certificate of public
convenience and necessity authorizing the construction and
operation of an Alaska natural gas transportation project has
been filed with the Commission within 18 months after the
date of enactment of this title, the Secretary of Energy
shall conduct a study of alternative approaches to the
construction and operation of the project.
(b) Scope of Study.--The study shall consider the
feasibility of establishing a Government corporation to
construct an Alaska natural gas transportation project, and
alternative means of providing Federal financing and
ownership (including alternative combinations of Government
and private corporate ownership) of the project.
(c) Consultation.--In conducting the study, the Secretary
of Energy shall consult with the Secretary of the Treasury
and the Secretary of the Army (acting through the Commanding
General of the Corps of Engineers).
(d) Report.--If the Secretary of Energy is required to
conduct a study under subsection (a), he shall submit a
report containing the results of the study, his
recommendations, and any proposals for legislation to
implement his recommendations to the Congress within 6 months
after the expiration of the Secretary of Energy's authority
to guarantee a loan under section 710.

SEC. 712. CLARIFICATION OF ANGTA STATUS AND AUTHORITIES.

(a) Savings Clause.--Nothing in this subtitle affects any
decision, certificate, permit, right-of-way, lease, or other
authorization issued under section 9 of the Alaska Natural
Gas Transportation Act of 1976 (15 U.S.C. 719g) or any
Presidential findings or waivers issued in accordance with
that Act.
(b) Clarification of Authority To Amend Terms and
Conditions To Meet Current Project Requirements.--Any Federal
officer or agency responsible for granting or issuing any
certificate, permit, right-of-way, lease, or other
authorization under section 9 of the Alaska Natural Gas
Transportation Act of 1976 (15 U.S.C. 719g) may add to,
amend, or abrogate any term or condition included in such
certificate, permit, right-of-way, lease, or other
authorization to meet current project requirements (including
the physical design, facilities, and tariff specifications),
so long as such action does not compel a change in the basic
nature and general route of the Alaska Natural Gas
Transportation System as designated and described in section
2 of the President's Decision, or would otherwise prevent or
impair in any significant respect the expeditious
construction and initial operation of such transportation
system.
(c) Updated Environmental Reviews.--The Secretary of Energy
shall require the sponsor of the Alaska Natural Gas
Transportation System to submit such updated environmental
data, reports, permits, and impact analyses as the Secretary
determines are necessary to develop detailed terms,
conditions, and compliance plans required by section 5 of the
President's Decision.

SEC. 713. DEFINITIONS.

For purposes of this subtitle:
(1) The term ``Alaska natural gas'' means natural gas
derived from the area of the State of Alaska lying north of
64 degrees North latitude.
(2) The term ``Alaska natural gas transportation project''
means any natural gas pipeline system that carries Alaska
natural gas to the border between Alaska and Canada
(including related facilities subject to the jurisdiction of
the Commission) that is authorized under either--
(A) the Alaska Natural Gas Transportation Act of 1976 (15
U.S.C. 719-719o); or
(B) section 704 of this subtitle.
(3) The term ``Alaska Natural Gas Transportation System''
means the Alaska natural gas transportation project
authorized under the Alaska Natural Gas Transportation Act of
1976 and designated and described in section 2 of the
President's Decision.
(4) The term ``Commission'' means the Federal Energy
Regulatory Commission.
(5) The term ``President's Decision'' means the Decision
and Report to Congress on the Alaska Natural Gas
Transportation system issued by the President on September
22, 1977 pursuant to section 7 of the Alaska Natural Gas
Transportation Act of 1976 (15 U.S.C. 719c) and approved by
Public Law 95-158.

SEC. 714. SENSE OF THE SENATE.

It is the sense of the Senate that an Alaska natural gas
transportation project will provide significant economic
benefits to the United States and Canada. In order to
maximize those benefits, the Senate urges the sponsors of the
pipeline project to make every effort to use steel that is
manufactured or produced in North America and to negotiate a
project labor agreement to expedite construction of the
pipeline.

SEC. 715. ALASKAN PIPELINE CONSTRUCTION TRAINING PROGRAM.

(a) Within six months after enactment of this Act, the
Secretary of Labor (in this section referred to as the
``Secretary'') shall submit a report to the Committee on
Energy and Natural Resources of the United States Senate and
the Committee on Resources of the United States House of
Representatives setting forth a program to train Alaska
residents in the skills and crafts required in the design,
construction, and operation of an Alaska gas pipeline system
and that will enhance employment and contracting
opportunities for Alaskan residents. The report shall also
describe any laws, rules, regulations and policies which act
as a deterrent to hiring Alaskan residents or contracting
with Alaskan residents to perform work on Alaska gas
pipelines, together with any recommendations for change. For
purposes of this subsection, Alaskan residents shall be
defined as those individuals eligible to vote within the
State of Alaska on the date of enactment of this Act.
(b) Within 1 year of the date the report is transmitted to
Congress, the Secretary shall establish within the State of
Alaska, at such locations as are appropriate, one or more
training centers for the express purpose of training Alaskan
residents in the skills and crafts necessary in the design,
construction and operation of gas pipelines in Alaska. Each
such training center shall also train Alaskan residents in
the skills required to write, offer, and monitor contracts in
support of the design, construction, and operation of Alaska
gas pipelines.
(c) In implementing the report and program described in
this subsection, the Secretary shall consult with the Alaskan
Governor.
(d) There are authorized to be appropriated to the
Secretary such sums as may be necessary, but not to exceed
$20,000,000 for the purposes of this subsection.

[[Page S10757]]

Subtitle B--Operating Pipelines

SEC. 721. ENVIRONMENTAL REVIEW AND PERMITTING OF NATURAL GAS
PIPELINE PROJECTS.

(a) Interagency Review.--The Chairman of the Council on
Environmental Quality, in coordination with the Federal
Energy Regulatory Commission, shall establish an interagency
task force to develop an interagency memorandum of
understanding to expedite the environmental review and
permitting of natural gas pipeline projects.
(b) Membership of Interagency Task Force.--The task force
shall consist of--
(1) the Chairman of the Council on Environmental Quality,
who shall serve as the Chairman of the interagency task
force,
(2) the Chairman of the Federal Energy Regulatory
Commission,
(3) the Director of the Bureau of Land Management,
(4) the Director of the United States Fish and Wildlife
Service,
(5) the Commanding General, United States Army Corps of
Engineers,
(6) the Chief of the Forest Service,
(7) the Administrator of the Environmental Protection
Agency,
(8) the Chairman of the Advisory Council on Historic
Preservation, and
(9) the heads of such other agencies as the Chairman of the
Council on Environmental Quality and the Chairman of the
Federal Energy Regulatory Commission deem appropriate.
(c) Memorandum of Understanding.--The agencies represented
by the members of the interagency task force shall enter into
the memorandum of understanding not later than 1 year after
the date of the enactment of this section.

Subtitle C--Pipeline Safety

PART I--SHORT TITLE; AMENDMENT OF TITLE 49

SEC. 741. SHORT TITLE; AMENDMENT OF TITLE 49, UNITED STATES
CODE.

(a) Short Title.--This subtitle may be cited as the
``Pipeline Safety Improvement Act of 2003''.
(b) Amendment of Title 49, United States Code.--Except as
otherwise expressly provided, whenever in this subtitle an
amendment or repeal is expressed in terms of an amendment to,
or a repeal of, a section or other provision, the reference
shall be considered to be made to a section or other
provision of title 49, United States Code.

PART II--PIPELINE SAFETY IMPROVEMENT ACT OF 2003

SEC. 761. IMPLEMENTATION OF INSPECTOR GENERAL
RECOMMENDATIONS.

(a) In General.--Except as otherwise required by this
subtitle, the Secretary shall implement the safety
improvement recommendations provided for in the Department of
Transportation Inspector General's Report (RT-2000-069).
(b) Reports by the Secretary.--Not later than 90 days after
the date of enactment of this Act, and every 90 days
thereafter until each of the recommendations referred to in
subsection (a) has been implemented, the Secretary shall
transmit to the Committee on Commerce, Science, and
Transportation of the Senate and the Committee on
Transportation and Infrastructure of the House of
Representatives a report on the specific actions taken to
implement such recommendations.
(c) Reports by the Inspector General.--The Inspector
General shall periodically transmit to the committees
referred to in subsection (b) a report assessing the
Secretary's progress in implementing the recommendations
referred to in subsection (a) and identifying options for the
Secretary to consider in accelerating recommendation
implementation.

SEC. 762. NTSB SAFETY RECOMMENDATIONS.

(a) In General.--The Secretary of Transportation, the
Administrator of Research and Special Program Administration,
and the Director of the Office of Pipeline Safety shall fully
comply with section 1135 of title 49, United States Code, to
ensure timely responsiveness to National Transportation
Safety Board recommendations about pipeline safety.
(b) Public Availability.--The Secretary, Administrator, or
Director, respectively, shall make a copy of each
recommendation on pipeline safety and response, as described
in sections 1135 (a) and (b) of title 49, United States Code,
available to the public at reasonable cost.
(c) Reports to Congress.--The Secretary, Administrator, or
Director, respectively, shall submit to the Congress by
January 1 of each year a report containing each
recommendation on pipeline safety made by the Board during
the prior year and a copy of the response to each such
recommendation.

SEC. 763. QUALIFICATIONS OF PIPELINE PERSONNEL.

(a) Qualification Plan.--Each pipeline operator shall make
available to the Secretary of Transportation, or, in the case
of an intrastate pipeline facility operator, the appropriate
State regulatory agency, a plan that is designed to enhance
the qualifications of pipeline personnel and to reduce the
likelihood of accidents and injuries. The plan shall be made
available not more than 6 months after the date of enactment
of this Act, and the operator shall revise or update the plan
as appropriate.
(b) Requirements.--The enhanced qualification plan shall
include, at a minimum, criteria to demonstrate the ability of
an individual to safely and properly perform tasks identified
under section 60102 of title 49, United States Code. The plan
shall also provide for training and periodic reexamination of
pipeline personnel qualifications and provide for
requalification as appropriate. The Secretary, or, in the
case of an intrastate pipeline facility operator, the
appropriate State regulatory agency, may review and certify
the plans to determine if they are sufficient to provide a
safe operating environment and shall periodically review the
plans to ensure the continuation of a safe operation. The
Secretary may establish minimum standards for pipeline
personnel training and evaluation, which may include written
examination, oral examination, work performance history
review, observation during performance on the job, on the job
training, simulations, or other forms of assessment.
(c) Report to Congress.--
(1) In general.--The Secretary shall submit a report to the
Congress evaluating the effectiveness of operator
qualification and training efforts, including--
(A) actions taken by inspectors;
(B) recommendations made by inspectors for changes to
operator qualification and training programs; and
(C) industry and employee organization responses to those
actions and recommendations.
(2) Criteria.--The Secretary may establish criteria for use
in evaluating and reporting on operator qualification and
training for purposes of this subsection.
(3) Due date.--The Secretary shall submit the report
required by paragraph (1) to the Congress 3 years after the
date of enactment of this Act.

SEC. 764. PIPELINE INTEGRITY INSPECTION PROGRAM.

Section 60109 is amended by adding at the end the
following:
``(c) Integrity Management.--
``(1) General requirement.--The Secretary shall promulgate
regulations requiring operators of hazardous liquid pipelines
and natural gas transmission pipelines to evaluate the risks
to the operator's pipeline facilities in areas identified
pursuant to subsection (a)(1), and to adopt and implement a
program for integrity management that reduces the risk of an
incident in those areas. The regulations shall be issued no
later than 1 year after the Secretary has issued standards
pursuant to subsections (a) and (b) of this section or by
December 31, 2003, whichever is sooner.
``(2) Standards for program.--In promulgating regulations
under this section, the Secretary shall require an operator's
integrity management plan to be based on risk analysis and
each plan shall include, at a minimum--
``(A) periodic assessment of the integrity of the pipeline
through methods including internal inspection, pressure
testing, direct assessment, or other effective methods. The
assessment period shall be no less than every 5 years unless
the Department of Transportation Inspector General, after
consultation with the Secretary determines there is not a
sufficient capability or it is deemed unnecessary because of
more technically appropriate monitoring or creates undue
interruption of necessary supply to fulfill the requirements
under this paragraph;
``(B) clearly defined criteria for evaluating the results
of the periodic assessment methods carried out under
subparagraph (A) and procedures to ensure identified problems
are corrected in a timely manner; and
``(C) measures, as appropriate, that prevent and mitigate
unintended releases, such as leak detection, integrity
evaluation, restrictive flow devices, or other measures.
``(3) Criteria for program standards.--In deciding how
frequently the integrity assessment methods carried out under
paragraph (2)(A) must be conducted, an operator shall take
into account the potential for new defects developing or
previously identified structural defects caused by
construction or installation, the operational characteristics
of the pipeline, and leak history. In addition, the Secretary
may establish a minimum testing requirement for operators of
pipelines to conduct internal inspections.
``(4) State role.--A State authority that has an agreement
in effect with the Secretary under section 60106 is
authorized to review and assess an operator's risk analyses
and integrity management plans required under this section
for interstate pipelines located in that State. The reviewing
State authority shall provide the Secretary with a written
assessment of the plans, make recommendations, as
appropriate, to address safety concerns not adequately
addressed in the operator's plans, and submit documentation
explaining the State-proposed plan revisions. The Secretary
shall carefully consider the State's proposals and work in
consultation with the States and operators to address safety
concerns.
``(5) Monitoring implementation.--The Secretary of
Transportation shall review the risk analysis and program for
integrity management required under this section and provide
for continued monitoring of such plans. Not later than 2
years after the implementation of integrity management plans
under this section, the Secretary shall complete an
assessment and evaluation of the effects on safety and the
environment of extending all of the requirements mandated by
the regulations described in paragraph (1) to additional
areas. The Secretary shall submit the assessment and
evaluation to Congress along with any recommendations to
improve and expand the utilization of integrity management
plans.
``(6) Opportunity for local input on integrity
management.--Within 18 months after the date of enactment of
the Pipeline Safety Improvement Act of 2003, the Secretary
shall, by regulation, establish a process for raising and
addressing local safety concerns about pipeline integrity and
the operator's pipeline integrity plan. The process shall
include--
``(A) a requirement that an operator of a hazardous liquid
or natural gas transmission pipeline facility provide
information about the risk analysis and integrity management
plan required under this section to local officials in a
State in which the facility is located;
``(B) a description of the local officials required to be
informed, the information that is to

[[Page S10758]]

be provided to them and the manner, which may include
traditional or electronic means, in which it is provided;
``(C) the means for receiving input from the local
officials that may include a public forum sponsored by the
Secretary or by the State, or the submission of written
comments through traditional or electronic means;
``(D) the extent to which an operator of a pipeline
facility must participate in a public forum sponsored by the
Secretary or in another means for receiving input from the
local officials or in the evaluation of that input; and
``(E) the manner in which the Secretary will notify the
local officials about how their concerns are being
addressed.''.

SEC. 765. ENFORCEMENT.

(a) In General.--Section 60112 is amended--
(1) by striking subsection (a) and inserting the following:
``(a) General Authority.--After notice and an opportunity
for a hearing, the Secretary of Transportation may decide a
pipeline facility is hazardous if the Secretary decides
that--
``(1) operation of the facility is or would be hazardous to
life, property, or the environment; or
``(2) the facility is, or would be, constructed or
operated, or a component of the facility is, or would be,
constructed or operated with equipment, material, or a
technique that the Secretary decides is hazardous to life,
property, or the environment.''; and
(2) by striking ``is hazardous,'' in subsection (d) and
inserting ``is, or would be, hazardous,''.

SEC. 766. PUBLIC EDUCATION, EMERGENCY PREPAREDNESS, AND
COMMUNITY RIGHT-TO-KNOW.

(a) Section 60116 is amended to read as follows:

``Sec. 60116. Public education, emergency preparedness, and
community right-to-know

``(a) Public Education Programs.--(1) Each owner or
operator of a gas or hazardous liquid pipeline facility shall
carry out a continuing program to educate the public on the
use of a one-call notification system prior to excavation and
other damage prevention activities, the possible hazards
associated with unintended releases from the pipeline
facility, the physical indications that such a release may
have occurred, what steps should be taken for public safety
in the event of a pipeline release, and how to report such an
event.
``(2) Within 12 months after the date of enactment of the
Pipeline Safety Improvement Act of 2003, each owner or
operator of a gas or hazardous liquid pipeline facility shall
review its existing public education program for
effectiveness and modify the program as necessary. The
completed program shall include activities to advise affected
municipalities, school districts, businesses, and residents
of pipeline facility locations. The completed program shall
be submitted to the Secretary or, in the case of an
intrastate pipeline facility operator, the appropriate State
agency and shall be periodically reviewed by the Secretary
or, in the case of an intrastate pipeline facility operator,
the appropriate State agency.
``(3) The Secretary may issue standards prescribing the
elements of an effective public education program. The
Secretary may also develop material for use in the program.
``(b) Emergency Preparedness.--
``(1) Operator liaison.--Within 12 months after the date of
enactment of the Pipeline Safety Improvement Act of 2003, an
operator of a gas transmission or hazardous liquid pipeline
facility shall initiate and maintain liaison with the State
emergency response commissions, and local emergency planning
committees in the areas of pipeline right-of-way, established
under section 301 of the Emergency Planning and Community
Right-To-Know Act of 1986 (42 U.S.C. 11001) in each State in
which it operates.
``(2) Information.--An operator shall, upon request, make
available to the State emergency response commissions and
local emergency planning committees, and shall make available
to the Office of Pipeline Safety in a standardized form for
the purpose of providing the information to the public, the
information described in section 60102(d), the operator's
program for integrity management, and information about
implementation of that program. The information about the
facility shall also include, at a minimum--
``(A) the business name, address, telephone number of the
operator, including a 24-hour emergency contact number;
``(B) a description of the facility, including pipe
diameter, the product or products carried, and the operating
pressure;
``(C) with respect to transmission pipeline facilities,
maps showing the location of the facility and, when
available, any high consequence areas which the pipeline
facility traverses or adjoins and abuts;
``(D) a summary description of the integrity measures the
operator uses to assure safety and protection for the
environment; and
``(E) a point of contact to respond to questions from
emergency response representative.
``(3) Smaller communities.--In a community without a local
emergency planning committee, the operator shall maintain
liaison with the local fire, police, and other emergency
response agencies.
``(4) Public access.--The Secretary shall prescribe
requirements for public access, as appropriate, to this
information, including a requirement that the information be
made available to the public by widely accessible
computerized database.
``(c) Community Right-To-Know.--Not later than 12 months
after the date of enactment of the Pipeline Safety
Improvement Act of 2003, and annually thereafter, the owner
or operator of each gas transmission or hazardous liquid
pipeline facility shall provide to the governing body of each
municipality in which the pipeline facility is located, a map
identifying the location of such facility. The map may be
provided in electronic form. The Secretary may provide
technical assistance to the pipeline industry on developing
public safety and public education program content and best
practices for program delivery, and on evaluating the
effectiveness of the programs. The Secretary may also provide
technical assistance to State and local officials in applying
practices developed in these programs to their activities to
promote pipeline safety.
``(d) Public Availability of Reports.--The Secretary
shall--
``(1) make available to the public--
``(A) a safety-related condition report filed by an
operator under section 60102(h);
``(B) a report of a pipeline incident filed by an operator;
``(C) the results of any inspection by the Office of
Pipeline Safety or a State regulatory official; and
``(D) a description of any corrective action taken in
response to a safety-related condition reported under
subparagraph (A), (B), or (C); and
``(2) prescribe requirements for public access, as
appropriate, to integrity management program information
prepared under this chapter, including requirements that will
ensure data accessibility to the greatest extent feasible.''.
(b) Safety Condition Reports.--Section 60102(h)(2) is
amended by striking ``authorities.'' and inserting
``officials, including the local emergency responders.''.
(c) Conforming Amendment.--The chapter analysis for chapter
601 is amended by striking the item relating to section 60116
and inserting the following:

``60116. Public education, emergency preparedness, community right-to-
know.''.

SEC. 767. PENALTIES.

(a) Civil Penalties.--Section 60122 is amended--
(1) by striking ``$25,000'' in subsection (a)(1) and
inserting ``$500,000'';
(2) by striking ``$500,000'' in subsection (a)(1) and
inserting ``$1,000,000'';
(3) by adding at the end of subsection (a)(1) the
following: ``The preceding sentence does not apply to
judicial enforcement action under section 60120 or 60121.'';
and
(4) by striking subsection (b) and inserting the following:
``(b) Penalty Considerations.--In determining the amount of
a civil penalty under this section--
``(1) the Secretary shall consider--
``(A) the nature, circumstances, and gravity of the
violation, including adverse impact on the environment;
``(B) with respect to the violator, the degree of
culpability, any history of prior violations, the ability to
pay, any effect on ability to continue doing business; and
``(C) good faith in attempting to comply; and
``(2) the Secretary may consider--
``(A) the economic benefit gained from the violation
without any discount because of subsequent damages; and
``(B) other matters that justice requires.''.
(b) Excavator Damage.--Section 60123(d) is amended--
(1) by striking ``knowingly and willfully'';
(2) by inserting ``knowingly and willfully'' before
``engages'' in paragraph (1); and
(3) striking paragraph (2)(B) and inserting the following:
``(B) a pipeline facility, is aware of damage, and does not
report the damage promptly to the operator of the pipeline
facility and to other appropriate authorities; or''.
(c) Civil Actions.--Section 60120(a)(1) is amended to read
as follows:
``(1) On the request of the Secretary of Transportation,
the Attorney General may bring a civil action in an
appropriate district court of the United States to enforce
this chapter, including section 60112 of this chapter, or a
regulation prescribed or order issued under this chapter. The
court may award appropriate relief, including a temporary or
permanent injunction, punitive damages, and assessment of
civil penalties considering the same factors as prescribed
for the Secretary in an administrative case under section
60122.''.

SEC. 768. STATE OVERSIGHT ROLE.

(a) State Agreements With Certification.--Section 60106 is
amended--
(1) by striking ``General Authority.--'' in subsection (a)
and inserting ``Agreements Without Certification.--'';
(2) by redesignating subsections (b), (c), and (d) as
subsections (c), (d), and (e); and
(3) by inserting after subsection (a) the following:
``(b) Agreements With Certification.--
``(1) In general.--If the Secretary accepts a certification
under section 60105 of this title and makes the determination
required under this subsection, the Secretary may make an
agreement with a State authority authorizing it to
participate in the oversight of interstate pipeline
transportation. Each such agreement shall include a plan for
the State authority to participate in special investigations
involving incidents or new construction and allow the State
authority to participate in other activities overseeing
interstate pipeline transportation or to assume additional
inspection or investigatory duties. Nothing in this section
modifies section 60104(c) or authorizes the Secretary to
delegate the enforcement of safety standards prescribed under
this chapter to a State authority.
``(2) Determinations required.--The Secretary may not enter
into an agreement under this subsection, unless the Secretary
determines that--
``(A) the agreement allowing participation of the State
authority is consistent with the Secretary's program for
inspection and consistent

[[Page S10759]]

with the safety policies and provisions provided under this
chapter;
``(B) the interstate participation agreement would not
adversely affect the oversight responsibilities of intrastate
pipeline transportation by the State authority;
``(C) the State is carrying out a program demonstrated to
promote preparedness and risk prevention activities that
enable communities to live safely with pipelines;
``(D) the State meets the minimum standards for State one-
call notification set forth in chapter 61; and
``(E) the actions planned under the agreement would not
impede interstate commerce or jeopardize public safety.
``(3) Existing agreements.--If requested by the State
authority, the Secretary shall authorize a State authority
which had an interstate agreement in effect after January
1999, to oversee interstate pipeline transportation pursuant
to the terms of that agreement until the Secretary determines
that the State meets the requirements of paragraph (2) and
executes a new agreement, or until December 31, 2003,
whichever is sooner. Nothing in this paragraph shall prevent
the Secretary, after affording the State notice, hearing, and
an opportunity to correct any alleged deficiencies, from
terminating an agreement that was in effect before enactment
of the Pipeline Safety Improvement Act of 2003 if--
``(A) the State authority fails to comply with the terms of
the agreement;
``(B) implementation of the agreement has resulted in a gap
in the oversight responsibilities of intrastate pipeline
transportation by the State authority; or
``(C) continued participation by the State authority in the
oversight of interstate pipeline transportation has had an
adverse impact on pipeline safety.''.
(b) Ending Agreements.--Subsection (e) of section 60106, as
redesignated by subsection (a), is amended to read as
follows:
``(e) Ending Agreements.--
``(1) Permissive termination.--The Secretary may end an
agreement under this section when the Secretary finds that
the State authority has not complied with any provision of
the agreement.
``(2) Mandatory termination of agreement.--The Secretary
shall end an agreement for the oversight of interstate
pipeline transportation if the Secretary finds that--
``(A) implementation of such agreement has resulted in a
gap in the oversight responsibilities of intrastate pipeline
transportation by the State authority;
``(B) the State actions under the agreement have failed to
meet the requirements under subsection (b); or
``(C) continued participation by the State authority in the
oversight of interstate pipeline transportation would not
promote pipeline safety.
``(3) Procedural requirements.--The Secretary shall give
the notice and an opportunity for a hearing to a State
authority before ending an agreement under this section. The
Secretary may provide a State an opportunity to correct any
deficiencies before ending an agreement. The finding and
decision to end the agreement shall be published in the
Federal Register and may not become effective for at least 15
days after the date of publication unless the Secretary finds
that continuation of an agreement poses an imminent
hazard.''.

SEC. 769. IMPROVED DATA AND DATA AVAILABILITY.

(a) In General.--Within 12 months after the date of
enactment of this Act, the Secretary shall develop and
implement a comprehensive plan for the collection and use of
gas and hazardous liquid pipeline data to revise the causal
categories on the incident report forms to eliminate
overlapping and confusing categories and include
subcategories. The plan shall include components to provide
the capability to perform sound incident trend analysis and
evaluations of pipeline operator performance using normalized
accident data.
(b) Report of Releases Exceeding 5 Gallons.--Section
60117(b) is amended--
(1) by inserting ``(1)'' before ``To'';
(2) redesignating paragraphs (1) and (2) as subparagraphs
(A) and (B);
(3) inserting before the last sentence the following:
``(2) A person owning or operating a hazardous liquid
pipeline facility shall report to the Secretary each release
to the environment greater than 5 gallons of the hazardous
liquid or carbon dioxide transported. This section applies to
releases from pipeline facilities regulated under this
chapter. A report must include the location of the release,
fatalities and personal injuries, type of product, amount of
product release, cause or causes of the release, extent of
damage to property and the environment, and the response
undertaken to clean up the release.
``(3) During the course of an incident investigation, a
person owning or operating a pipeline facility shall make
records, reports, and information required under subsection
(a) of this section or other reasonably described records,
reports, and information relevant to the incident
investigation, available to the Secretary within the time
limits prescribed in a written request.''; and
(4) indenting the first word of the last sentence and
inserting ``(4)'' before ``The Secretary'' in that sentence.
(c) Penalty Authorities.--(1) Section 60122(a) is amended
by striking ``60114(c)'' and inserting ``60117(b)(3)''.
(2) Section 60123(a) is amended by striking ``60114(c),''
and inserting ``60117(b)(3),''.
(d) Establishment of National Depository.--Section 60117 is
amended by adding at the end the following:
``(l) National Depository.--The Secretary shall establish a
national depository of data on events and conditions,
including spill histories and corrective actions for specific
incidents, that can be used to evaluate the risk of, and to
prevent, pipeline failures and releases. The Secretary shall
administer the program through the Bureau of Transportation
Statistics, in cooperation with the Research and Special
Programs Administration, and shall make such information
available for use by State and local planning and emergency
response authorities and the public.''.

SEC. 770. RESEARCH AND DEVELOPMENT.

(a) Innovative Technology Development.--
(1) In general.--As part of the Department of
Transportation's research and development program, the
Secretary of Transportation shall direct research attention
to the development of alternative technologies--
(A) to expand the capabilities of internal inspection
devices to identify and accurately measure defects and
anomalies;
(B) to inspect pipelines that cannot accommodate internal
inspection devices available on the date of enactment;
(C) to develop innovative techniques measuring the
structural integrity of pipelines;
(D) to improve the capability, reliability, and
practicality of external leak detection devices; and
(E) to develop and improve alternative technologies to
identify and monitor outside force damage to pipelines.
(2) Cooperative.--The Secretary may participate in
additional technological development through cooperative
agreements with trade associations, academic institutions, or
other qualified organizations.
(b) Pipeline Safety and Reliability Research and
Development.--
(1) In general.--The Secretary of Transportation, in
coordination with the Secretary of Energy, shall develop and
implement an accelerated cooperative program of research and
development to ensure the integrity of natural gas and
hazardous liquid pipelines. This research and development
program--
(A) shall include materials inspection techniques, risk
assessment methodology, and information systems surety; and
(B) shall complement, and not replace, the research program
of the Department of Energy addressing natural gas pipeline
issues existing on the date of enactment of this Act.
(2) Purpose.--The purpose of the cooperative research
program shall be to promote pipeline safety research and
development to--
(A) ensure long-term safety, reliability and service life
for existing pipelines;
(B) expand capabilities of internal inspection devices to
identify and accurately measure defects and anomalies;
(C) develop inspection techniques for pipelines that cannot
accommodate the internal inspection devices available on the
date of enactment;
(D) develop innovative techniques to measure the structural
integrity of pipelines to prevent pipeline failures;
(E) develop improved materials and coatings for use in
pipelines;
(F) improve the capability, reliability, and practicality
of external leak detection devices;
(G) identify underground environments that might lead to
shortened service life;
(H) enhance safety in pipeline siting and land use;
(I) minimize the environmental impact of pipelines;
(J) demonstrate technologies that improve pipeline safety,
reliability, and integrity;
(K) provide risk assessment tools for optimizing risk
mitigation strategies; and
(L) provide highly secure information systems for
controlling the operation of pipelines.
(3) Areas.--In carrying out this subsection, the Secretary
of Transportation, in coordination with the Secretary of
Energy, shall consider research and development on natural
gas, crude oil and petroleum product pipelines for--
(A) early crack, defect, and damage detection, including
real-time damage monitoring;
(B) automated internal pipeline inspection sensor systems;
(C) land use guidance and set back management along
pipeline rights-of-way for communities;
(D) internal corrosion control;
(E) corrosion-resistant coatings;
(F) improved cathodic protection;
(G) inspection techniques where internal inspection is not
feasible, including measurement of structural integrity;
(H) external leak detection, including portable real-time
video imaging technology, and the advancement of computerized
control center leak detection systems utilizing real-time
remote field data input;
(I) longer life, high strength, non-corrosive pipeline
materials;
(J) assessing the remaining strength of existing pipes;
(K) risk and reliability analysis models, to be used to
identify safety improvements that could be realized in the
near term resulting from analysis of data obtained from a
pipeline performance tracking initiative;
(L) identification, monitoring, and prevention of outside
force damage, including satellite surveillance; and
(M) any other areas necessary to ensuring the public safety
and protecting the environment.
(4) Points of contact.--
(A) In general.--To coordinate and implement the research
and development programs and activities authorized under this
subsection--
(i) the Secretary of Transportation shall designate, as the
point of contact for the Department of Transportation, an
officer of the Department of Transportation who has been
appointed by the President and confirmed by the Senate; and

[[Page S10760]]

(ii) the Secretary of Energy shall designate, as the point
of contact for the Department of Energy, an officer of the
Department of Energy who has been appointed by the President
and confirmed by the Senate.
(B) Duties.--
(i) The point of contact for the Department of
Transportation shall have the primary responsibility for
coordinating and overseeing the implementation of the
research, development, and demonstration program plan under
paragraphs (5) and (6).
(ii) The points of contact shall jointly assist in
arranging cooperative agreements for research, development
and demonstration involving their respective Departments,
national laboratories, universities, and industry research
organizations.
(5) Research and development program plan.--Within 240 days
after the date of enactment of this Act, the Secretary of
Transportation, in coordination with the Secretary of Energy
and the Pipeline Integrity Technical Advisory Committee,
shall prepare and submit to the Congress a 5-year program
plan to guide activities under this subsection. In preparing
the program plan, the Secretary shall consult with
appropriate representatives of the natural gas, crude oil,
and petroleum product pipeline industries to select and
prioritize appropriate project proposals. The Secretary may
also seek the advice of utilities, manufacturers,
institutions of higher learning, Federal agencies, the
pipeline research institutions, national laboratories, State
pipeline safety officials, environmental organizations,
pipeline safety advocates, and professional and technical
societies.
(6) Implementation.--The Secretary of Transportation shall
have primary responsibility for ensuring the 5-year plan
provided for in paragraph (5) is implemented as intended. In
carrying out the research, development, and demonstration
activities under this paragraph, the Secretary of
Transportation and the Secretary of Energy may use, to the
extent authorized under applicable provisions of law,
contracts, cooperative agreements, cooperative research and
development agreements under the Stevenson-Wydler Technology
Innovation Act of 1980 (15 U.S.C. 3701 et seq.), grants,
joint ventures, other transactions, and any other form of
agreement available to the Secretary consistent with the
recommendations of the Advisory Committee.
(7) Reports to congress.--The Secretary of Transportation
shall report to the Congress annually as to the status and
results to date of the implementation of the research and
development program plan. The report shall include the
activities of the Departments of Transportation and Energy,
the national laboratories, universities, and any other
research organizations, including industry research
organizations.

SEC. 771. PIPELINE INTEGRITY TECHNICAL ADVISORY COMMITTEE.

(a) Establishment.--The Secretary of Transportation shall
enter into appropriate arrangements with the National Academy
of Sciences to establish and manage the Pipeline Integrity
Technical Advisory Committee for the purpose of advising the
Secretary of Transportation and the Secretary of Energy on
the development and implementation of the 5-year research,
development, and demonstration program plan under section
770(b)(5). The Advisory Committee shall have an ongoing role
in evaluating the progress and results of the research,
development, and demonstration carried out under that
section.
(b) Membership.--The National Academy of Sciences shall
appoint the members of the Pipeline Integrity Technical
Advisory Committee after consultation with the Secretary of
Transportation and the Secretary of Energy. Members appointed
to the Advisory Committee should have the necessary
qualifications to provide technical contributions to the
purposes of the Advisory Committee.

SEC. 772. AUTHORIZATION OF APPROPRIATIONS.

(a) Gas and Hazardous Liquids.--Section 60125(a) is amended
to read as follows:
``(a) Gas and Hazardous Liquid.--To carry out this chapter
and other pipeline-related damage prevention activities of
this title (except for section 60107), there are authorized
to be appropriated to the Department of Transportation--
$30,000,000 for each of the fiscal years 2003, 2004, and 2005
of which $23,000,000 is to be derived from user fees for
fiscal years 2003, 2004, and 2005 collected under section
60301 of this title.''.
(b) Grants to States.--Section 60125(c) is amended to read
as follows:
``(c) State Grants.--Not more than the following amounts
may be appropriated to the Secretary to carry out section
60107--$20,000,000 for the fiscal years 2003, 2004, and 2005
of which $18,000,000 is to be derived from user fees for
fiscal years 2003, 2004, and 2005 collected under section
60301 of this title.''.
(c) Oil Spills.--Section 60125 is amended by redesignating
subsections (d), (e), and (f) as subsections (e), (f), (g)
and inserting after subsection (c) the following:
``(d) Oil Spill Liability Trust Fund.--Of the amounts
available in the Oil Spill Liability Trust Fund, $8,000,000
shall be transferred to the Secretary of Transportation, as
provided in appropriation Acts, to carry out programs
authorized in this title for each of fiscal years 2003, 2004,
and 2005.''.
(d) Pipeline Integrity Program.--(1) There are authorized
to be appropriated to the Secretary of Transportation for
carrying out sections 770(b) and 771 of this subtitle
$3,000,000, to be derived from user fees under section 60301
of title 49, United States Code, for each of the fiscal years
2003 through 2007.
(2) Of the amounts available in the Oil Spill Liability
Trust Fund established by section 9509 of the Internal
Revenue Code of 1986 (26 U.S.C. 9509), $3,000,000 shall be
transferred to the Secretary of Transportation, as provided
in appropriation Acts, to carry out programs for detection,
prevention and mitigation of oil spills under sections 770(b)
and 771 of this subtitle for each of the fiscal years 2003
through 2007.
(3) There are authorized to be appropriated to the
Secretary of Energy for carrying out sections 770(b) and 771
of this subtitle such sums as may be necessary for each of
the fiscal years 2003 through 2007.

SEC. 773. OPERATOR ASSISTANCE IN INVESTIGATIONS.

(a) In General.--If the Department of Transportation or the
National Transportation Safety Board investigate an accident,
the operator involved shall make available to the
representative of the Department or the Board all records and
information that in any way pertain to the accident
(including integrity management plans and test results), and
shall afford all reasonable assistance in the investigation
of the accident.
(b) Corrective Action Orders.--Section 60112(d) is
amended--
(1) by inserting ``(1)'' after ``Corrective Action
Orders.--''; and
(2) by adding at the end the following:
``(2) If, in the case of a corrective action order issued
following an accident, the Secretary determines that the
actions of an employee carrying out an activity regulated
under this chapter, including duties under section 60102(a),
may have contributed substantially to the cause of the
accident, the Secretary shall direct the operator to relieve
the employee from performing those activities, reassign the
employee, or place the employee on leave until the earlier of
the date on which--
``(A) the Secretary determines, after notice and an
opportunity for a hearing, that the employee's performance of
duty in carrying out the activity did not contribute
substantially to the cause of the accident; or
``(B) the Secretary determines the employee has been re-
qualified or re-trained as provided for in section 763 of the
Pipeline Safety Improvement Act of 2003 and can safely
perform those activities.
``(3) Action taken by an operator under paragraph (2) shall
be in accordance with the terms and conditions of any
applicable collective bargaining agreement to the extent it
is not inconsistent with the requirements of this section.''.

SEC. 774. PROTECTION OF EMPLOYEES PROVIDING PIPELINE SAFETY
INFORMATION.

(a) In General.--Chapter 601 is amended by adding at the
end the following:

``Sec. 60129. Protection of employees providing pipeline
safety information

``(a) Discrimination Against Pipeline Employees.--No
pipeline operator or contractor or subcontractor of a
pipeline may discharge an employee or otherwise discriminate
against an employee with respect to compensation, terms,
conditions, or privileges of employment because the employee
(or any person acting pursuant to a request of the
employee)--
``(1) provided, caused to be provided, or is about to
provide (with any knowledge of the employer) or cause to be
provided to the employer or Federal Government information
relating to any violation or alleged violation of any order,
regulation, or standard of the Research and Special Programs
Administration or any other provision of Federal law relating
to pipeline safety under this chapter or any other law of the
United States;
``(2) has filed, caused to be filed, or is about to file
(with any knowledge of the employer) or cause to be filed a
proceeding relating to any violation or alleged violation of
any order, regulation, or standard of the Administration or
any other provision of Federal law relating to pipeline
safety under this chapter or any other law of the United
States;
``(3) testified or is about to testify in such a
proceeding; or
``(4) assisted or participated or is about to assist or
participate in such a proceeding.
``(b) Department of Labor Complaint Procedure.--
``(1) Filing and notification.--A person who believes that
he or she has been discharged or otherwise discriminated
against by any person in violation of subsection (a) may, not
later than 90 days after the date on which such violation
occurs, file (or have any person file on his or her behalf) a
complaint with the Secretary of Labor alleging such discharge
or discrimination. Upon receipt of such a complaint, the
Secretary of Labor shall notify, in writing, the person named
in the complaint and the Administrator of the Research and
Special Programs Administration of the filing of the
complaint, of the allegations contained in the complaint, of
the substance of evidence supporting the complaint, and of
the opportunities that will be afforded to such person under
paragraph (2).
``(2) Investigation; preliminary order.--
``(A) In general.--Not later than 60 days after the date of
receipt of a complaint filed under paragraph (1) and after
affording the person named in the complaint an opportunity to
submit to the Secretary of Labor a written response to the
complaint and an opportunity to meet with a representative of
the Secretary to present statements from witnesses, the
Secretary of Labor shall conduct an investigation and
determine whether there is reasonable cause to believe that
the complaint has merit and notify in writing the complainant
and the person alleged to have committed a violation of
subsection (a) of the Secretary's findings. If the Secretary
of Labor concludes that there is reasonable cause to believe
that a violation of subsection (a) has occurred, the
Secretary shall accompany the Secretary's findings with a
preliminary order providing the relief prescribed by
paragraph (3)(B). Not later than 30 days after the date of
notification of findings under this paragraph, either the
person alleged to have committed the violation or the
complainant may file objections

[[Page S10761]]

to the findings or preliminary order, or both, and request a
hearing on the record. The filing of such objections shall
not operate to stay any reinstatement remedy contained in the
preliminary order. Such hearings shall be conducted
expeditiously. If a hearing is not requested in such 30-day
period, the preliminary order shall be deemed a final order
that is not subject to judicial review.
``(B) Requirements.--
``(i) Required showing by complainant.--The Secretary of
Labor shall dismiss a complaint filed under this subsection
and shall not conduct an investigation otherwise required
under subparagraph (A) unless the complainant makes a prima
facie showing that any behavior described in paragraphs (1)
through (4) of subsection (a) was a contributing factor in
the unfavorable personnel action alleged in the complaint.
``(ii) Showing by employer.--Notwithstanding a finding by
the Secretary that the complainant has made the showing
required under clause (i), no investigation otherwise
required under subparagraph (A) shall be conducted if the
employer demonstrates, by clear and convincing evidence, that
the employer would have taken the same unfavorable personnel
action in the absence of that behavior.
``(iii) Criteria for determination by Secretary.--The
Secretary may determine that a violation of subsection (a)
has occurred only if the complainant demonstrates that any
behavior described in paragraphs (1) through (4) of
subsection (a) was a contributing factor in the unfavorable
personnel action alleged in the complaint.
``(iv) Prohibition.--Relief may not be ordered under
subparagraph (A) if the employer demonstrates by clear and
convincing evidence that the employer would have taken the
same unfavorable personnel action in the absence of that
behavior.
``(3) Final order.--
``(A) Deadline for issuance; settlement agreements.--Not
later than 120 days after the date of conclusion of a hearing
under paragraph (2), the Secretary of Labor shall issue a
final order providing the relief prescribed by this paragraph
or denying the complaint. At any time before issuance of a
final order, a proceeding under this subsection may be
terminated on the basis of a settlement agreement entered
into by the Secretary of Labor, the complainant, and the
person alleged to have committed the violation.
``(B) Remedy.--If, in response to a complaint filed under
paragraph (1), the Secretary of Labor determines that a
violation of subsection (a) has occurred, the Secretary of
Labor shall order the person who committed such violation
to--
``(i) take affirmative action to abate the violation;
``(ii) reinstate the complainant to his or her former
position together with the compensation (including back pay)
and restore the terms, conditions, and privileges associated
with his or her employment; and
``(iii) provide compensatory damages to the complainant.

If such an order is issued under this paragraph, the
Secretary of Labor, at the request of the complainant, shall
assess against the person whom the order is issued a sum
equal to the aggregate amount of all costs and expenses
(including attorney's and expert witness fees) reasonably
incurred, as determined by the Secretary of Labor, by the
complainant for, or in connection with, the bringing the
complaint upon which the order was issued.
``(C) Frivolous complaints.--If the Secretary of Labor
finds that a complaint under paragraph (1) is frivolous or
has been brought in bad faith, the Secretary of Labor may
award to the prevailing employer a reasonable attorney's fee
not exceeding $1,000.
``(4) Review.--
``(A) Appeal to court of appeals.--Any person adversely
affected or aggrieved by an order issued under paragraph (3)
may obtain review of the order in the United States Court of
Appeals for the circuit in which the violation, with respect
to which the order was issued, allegedly occurred or the
circuit in which the complainant resided on the date of such
violation. The petition for review must be filed not later
than 60 days after the date of issuance of the final order of
the Secretary of Labor. Review shall conform to chapter 7 of
title 5, United States Code. The commencement of proceedings
under this subparagraph shall not, unless ordered by the
court, operate as a stay of the order.
``(B) Limitation on collateral attack.--An order of the
Secretary of Labor with respect to which review could have
been obtained under subparagraph (A) shall not be subject to
judicial review in any criminal or other civil proceeding.
``(5) Enforcement of order by secretary of labor.--Whenever
any person has failed to comply with an order issued under
paragraph (3), the Secretary of Labor may file a civil action
in the United States district court for the district in which
the violation was found to occur to enforce such order. In
actions brought under this paragraph, the district courts
shall have jurisdiction to grant all appropriate relief,
including, but not to be limited to, injunctive relief and
compensatory damages.
``(6) Enforcement of order by parties.--
``(A) Commencement of action.--A person on whose behalf an
order was issued under paragraph (3) may commence a civil
action against the person to whom such order was issued to
require compliance with such order. The appropriate United
States district court shall have jurisdiction, without regard
to the amount in controversy or the citizenship of the
parties, to enforce such order.
``(B) Attorney fees.--The court, in issuing any final order
under this paragraph, may award costs of litigation
(including reasonable attorney and expert witness fees) to
any party whenever the court determines such award costs is
appropriate.
``(c) Mandamus.--Any nondiscretionary duty imposed by this
section shall be enforceable in a mandamus proceeding brought
under section 1361 of title 28, United States Code.
``(d) Nonapplicability To Deliberate Violations.--
Subsection (a) shall not apply with respect to an employee of
a pipeline, contractor or subcontractor who, acting without
direction from the pipeline contractor or subcontractor (or
such person's agent), deliberately causes a violation of any
requirement relating to pipeline safety under this chapter or
any other law of the United States.
``(e) Contractor Defined.--In this section, the term
`contractor' means a company that performs safety-sensitive
functions by contract for a pipeline.''.
(b) Civil Penalty.--Section 60122(a) is amended by adding
at the end the following:
``(3) A person violating section 60129, or an order issued
thereunder, is liable to the Government for a civil penalty
of not more than $1,000 for each violation. The penalties
provided by paragraph (1) do not apply to a violation of
section 60129 or an order issued thereunder.''.
(c) Conforming Amendment.--The chapter analysis for chapter
601 is amended by adding at the end the following:

``60129. Protection of employees providing pipeline safety
information.''.

SEC. 775. STATE PIPELINE SAFETY ADVISORY COMMITTEES.

Within 90 days after receiving recommendations for
improvements to pipeline safety from an advisory committee
appointed by the Governor of any State, the Secretary of
Transportation shall respond in writing to the committee
setting forth what action, if any, the Secretary will take on
those recommendations and the Secretary's reasons for acting
or not acting upon any of the recommendations.

SEC. 776. FINES AND PENALTIES.

The Inspector General of the Department of Transportation
shall conduct an analysis of the Department's assessment of
fines and penalties on gas transmission and hazardous liquid
pipelines, including the cost of corrective actions required
by the Department in lieu of fines, and, no later than 6
months after the date of enactment of this Act, shall provide
a report to the Senate Committee on Commerce, Science, and
Transportation and the House Committee on Transportation and
Infrastructure on any findings and recommendations for
actions by the Secretary or Congress to ensure the fines
assessed are an effective deterrent for reducing safety
risks.

SEC. 777. STUDY OF RIGHTS-OF-WAY.

The Secretary of Transportation is authorized to conduct a
study on how best to preserve environmental resources in
conjunction with maintaining pipeline rights-of-way. The
study shall recognize pipeline operators' regulatory
obligations to maintain rights-of-way and to protect public
safety.

SEC. 778. STUDY OF NATURAL GAS RESERVE.

(a) Findings.--Congress finds that:
(1) In the last few months, natural gas prices across the
country have tripled.
(2) In California, natural gas prices have increased
twenty-fold, from $3 per million British thermal units to
nearly $60 per million British thermal units.
(3) One of the major causes of these price increases is a
lack of supply, including a lack of natural gas reserves.
(4) The lack of a reserve was compounded by the rupture of
an El Paso Natural Gas Company pipeline in Carlsbad, New
Mexico on August 1, 2000.
(5) Improving pipeline safety will help prevent similar
accidents that interrupt the supply of natural gas and will
help save lives.
(6) It is also necessary to find solutions for the lack of
natural gas reserves that could be used during emergencies.
(b) Study by the National Academy of Sciences.--The
Secretary of Energy shall request the National Academy of
Sciences to--
(1) conduct a study to--
(A) determine the causes of recent increases in the price
of natural gas, including whether the increases have been
caused by problems with the supply of natural gas or by
problems with the natural gas transmission system;
(B) identify any Federal or State policies that may have
contributed to the price increases; and
(C) determine what Federal action would be necessary to
improve the reserve supply of natural gas for use in
situations of natural gas shortages and price increases,
including determining the feasibility and advisability of a
Federal strategic natural gas reserve system; and
(2) not later than 60 days after the date of enactment of
this Act, submit to Congress a report on the results of the
study.

SEC. 779. STUDY AND REPORT ON NATURAL GAS PIPELINE AND
STORAGE FACILITIES IN NEW ENGLAND.

(a) Study.--The Federal Energy Regulatory Commission, in
consultation with the Department of Energy, shall conduct a
study on the natural gas pipeline transmission network in New
England and natural gas storage facilities associated with
that network. In carrying out the study, the Commission shall
consider--
(1) the ability of natural gas pipeline and storage
facilities in New England to meet current and projected
demand by gas-fired power generation plants and other
consumers;
(2) capacity constraints during unusual weather periods;
(3) potential constraint points in regional, interstate,
and international pipeline capacity serving New England; and
(4) the quality and efficiency of the Federal environmental
review and permitting process for natural gas pipelines.

[[Page S10762]]

(b) Report.--Not later than 120 days after the date of the
enactment of this Act, the Federal Energy Regulatory
Commission shall prepare and submit to the Senate Committee
on Energy and Natural Resources and the appropriate committee
of the House of Representatives a report containing the
results of the study conducted under subsection (a),
including recommendations for addressing potential natural
gas transmission and storage capacity problems in New
England.

PART III--PIPELINE SECURITY SENSITIVE INFORMATION

SEC. 781. MEETING COMMUNITY RIGHT TO KNOW WITHOUT SECURITY
RISKS.

Section 60117 is amended by adding at the end the
following:
``(l) Withholding Certain Information.--
``(1) In general.--Notwithstanding any other provision of
this chapter requiring the Secretary to provide information
obtained by the Secretary or an officer, employee, or agent
in carrying out this chapter to State or local government
officials, the public, or any other person, the Secretary
shall withhold such information if it is information that is
described in section 552(b)(1)(A) of title 5, United States
Code.
``(2) Conditional release.--Notwithstanding paragraph (1),
upon the receipt of assurances satisfactory to the Secretary
that the information will be handled appropriately, the
Secretary may provide information permitted to be withheld
under that paragraph--
``(A) to the owner or operator of the affected pipeline
system;
``(B) to an officer, employee or agent of a Federal, State,
tribal, or local government, including a volunteer fire
department, concerned with carrying out this chapter, with
protecting the facilities, with protecting public safety, or
with national security issues;
``(C) in an administrative or judicial proceeding brought
under this chapter or an administrative or judicial
proceeding that addresses terrorist actions or threats of
such actions; or
``(D) to such other persons as the Secretary determines
necessary to protect public safety and security.
``(3) Report to Congress.--The Secretary shall provide an
annual report to the Congress, in appropriate form as
determined by the Secretary, containing a summary of
determinations made by the Secretary during the preceding
year to withhold information from release under paragraph
(1).''.

SEC. 782. TECHNICAL ASSISTANCE FOR SECURITY OF PIPELINE
FACILITIES.

The Secretary of Transportation may provide technical
assistance to an operator of a pipeline facility or to State,
tribal, or local officials to prevent or respond to acts of
terrorism that may impact the pipeline facility, including--
(1) actions by the Secretary that support the use of
National Guard or State or Federal personnel to provide
additional security for a pipeline facility at risk of
terrorist attack or in response to such an attack;
(2) use of resources available to the Secretary to develop
and implement security measures for a pipeline facility;
(3) identification of security issues with respect to the
operation of a pipeline facility; and
(4) the provision of information and guidance on security
practices that prevent damage to pipeline facilities from
terrorist attacks.

SEC. 783. CRIMINAL PENALTIES FOR DAMAGING OR DESTROYING A
FACILITY.

Section 60123(b) of title 49, United States Code, is
amended--
(1) by striking ``or'' after ``gas pipeline facility'' and
inserting a comma; and
(2) by inserting after ``liquid pipeline facility'' the
following: ``, or either an intrastate gas pipeline facility
or an intrastate hazardous liquid pipeline facility that is
used in interstate or foreign commerce or in any activity
affecting interstate or foreign commerce''.

DIVISION C--DIVERSIFYING ENERGY DEMAND AND IMPROVING EFFICIENCY

TITLE VIII--FUELS AND VEHICLES

Subtitle A--CAFE Standards, Alternative Fuels, and Advanced Technology

SEC. 801. INCREASED FUEL ECONOMY STANDARDS.

(a) Requirement for New Regulations.--
(1) In general.--The Secretary of Transportation shall
issue, under section 32902 of title 49, United States Code,
new regulations setting forth increased average fuel economy
standards for automobiles that are determined on the basis of
the maximum feasible average fuel economy levels for the
automobiles, taking into consideration the matters set forth
in subsection (f) of such section.
(2) Time for issuing regulations.--
(A) Non-passenger automobiles.--For non-passenger
automobiles, the Secretary of Transportation shall issue the
final regulations not later than 15 months after the date of
the enactment of this Act.
(B) Passenger automobiles.--For passenger automobiles, the
Secretary of Transportation shall issue--
(i) the proposed regulations not later than 180 days after
the date of the enactment of this Act; and
(ii) the final regulations not later than 2 years after
that date.
(b) Phased Increases.--The regulations issued pursuant to
subsection (a) shall specify standards that take effect
successively over several vehicle model years not exceeding
15 vehicle model years.
(c) Clarification of Authority To Amend Passenger
Automobile Standard.--Section 32902(b) of title 49, United
States Code, is amended by inserting before the period at the
end the following: ``or such other number as the Secretary
prescribes under subsection (c)''.
(d) Environmental Assessment.--When issuing final
regulations setting forth increased average fuel economy
standards under this section, the Secretary of Transportation
shall also issue an environmental assessment of the effects
of the implementation of the increased standards on the
environment under the National Environmental Policy Act of
1969 (42 U.S.C. 4321 et seq.).
(e) Authorization of Appropriations.--There is authorized
to be appropriated to the Department of Transportation for
fiscal year 2003, to remain available until expended,
$2,000,000 to carry out this section.

SEC. 802. EXPEDITED PROCEDURES FOR CONGRESSIONAL INCREASE IN
FUEL ECONOMY STANDARDS.

(a) Condition for Applicability.--If the Secretary of
Transportation fails to issue final regulations with respect
to non-passenger automobiles under section 801, or fails to
issue final regulations with respect to passenger automobiles
under such section, on or before the date by which such final
regulations are required by such section to be issued,
respectively, then this section shall apply with respect to a
bill described in subsection (b).
(b) Bill.--A bill referred to in this subsection is a bill
that satisfies the following requirements:
(1) Introduction.--The bill is introduced by one or more
Members of Congress not later than 60 days after the date
referred to in subsection (a).
(2) Title.--The title of the bill is as follows: ``A bill
to establish new average fuel economy standards for certain
motor vehicles.''.
(3) Text.--The bill provides after the enacting clause only
the text specified in subparagraph (A) or (B) or any
provision described in subparagraph (C), as follows:
(A) Non-passenger automobiles.--In the case of a bill
relating to a failure timely to issue final regulations
relating to non-passenger automobiles, the following text:

``That, section 32902 of title 49, United States Code, is
amended by adding at the end the following new subsection:
`` `(__) Non-passenger automobiles.--The average fuel
economy standard for non-passenger automobiles manufactured
by a manufacturer in a model year after model year ____ shall
be ____ miles per gallon.' '', the first blank space being
filled in with a subsection designation, the second blank
space being filled in with the number of a year, and the
third blank space being filled in with a number.
(B) Passenger automobiles.--In the case of a bill relating
to a failure timely to issue final regulations relating to
passenger automobiles, the following text:

``That, section 32902(b) of title 49, United States Code, is
amended to read as follows:
`` `(b) Passenger Automobiles.--Except as provided in this
section, the average fuel economy standard for passenger
automobiles manufactured by a manufacturer in a model year
after model year ____ shall be ____ miles per gallon.' '',
the first blank space being filled in with the number of a
year and the second blank space being filled in with a
number.
(C) Substitute text.--Any text substituted by an amendment
that is in order under subsection (c)(3).
(c) Expedited Procedures.--A bill described in subsection
(b) shall be considered in a House of Congress in accordance
with the procedures provided for the consideration of joint
resolutions in paragraphs (3) through (8) of section 8066(c)
of the Department of Defense Appropriations Act, 1985 (as
contained in section 101(h) of Public Law 98-473; 98 Stat.
1936), with the following exceptions:
(1) References to resolution.--The references in such
paragraphs to a resolution shall be deemed to refer to the
bill described in subsection (b).
(2) Committees of jurisdiction.--The committees to which
the bill is referred under this subsection shall--
(A) in the Senate, be the Committee on Commerce, Science,
and Transportation; and
(B) in the House of Representatives, be the Committee on
Energy and Commerce.
(3) Amendments.--
(A) Amendments in order.--Only four amendments to the bill
are in order in each House, as follows:
(i) Two amendments proposed by the majority leader of that
House.
(ii) Two amendments proposed by the minority leader of that
House.
(B) Form and content.--To be in order under subparagraph
(A), an amendment shall propose to strike all after the
enacting clause and substitute text that only includes the
same text as is proposed to be stricken except for one or
more different numbers in the text.
(C) Debate, et cetera.--Subparagraph (B) of section
8066(c)(5) of the Department of Defense Appropriations Act,
1985 (98 Stat. 1936) shall apply to the consideration of each
amendment proposed pursuant to subparagraph (A) of this
paragraph in the same manner as such subparagraph (B) applies
to debatable motions.

SEC. 803. REVISED CONSIDERATIONS FOR DECISIONS ON MAXIMUM
FEASIBLE AVERAGE FUEL ECONOMY.

Section 32902(f) of title 49, United States Code, is
amended to read as follows:
``(f) Considerations for Decisions on Maximum Feasible
Average Fuel Economy.--When deciding maximum feasible average
fuel economy under this section, the Secretary of
Transportation shall consider the following matters:
``(1) Technological feasibility.
``(2) Economic practicability.
``(3) The effect of other motor vehicle standards of the
Government on fuel economy.
``(4) The need of the United States to conserve energy.

[[Page S10763]]

``(5) The desirability of reducing United States dependence
on imported oil.
``(6) The effects of the average fuel economy standards on
motor vehicle and passenger safety.
``(7) The effects of increased fuel economy on air quality.
``(8) The adverse effects of average fuel economy standards
on the relative competitiveness of manufacturers.
``(9) The effects of compliance with average fuel economy
standards on levels of employment in the United States.
``(10) The cost and lead time necessary for the
introduction of the necessary new technologies.
``(11) The potential for advanced technology vehicles, such
as hybrid and fuel cell vehicles, to contribute to the
achievement of significant reductions in fuel consumption.
``(12) The extent to which the necessity for vehicle
manufacturers to incur near-term costs to comply with the
average fuel economy standards adversely affects the
availability of resources for the development of advanced
technology for the propulsion of motor vehicles.
``(13) The report of the National Research Council that is
entitled `Effectiveness and Impact of Corporate Average Fuel
Economy Standards', issued in January 2002.''.

SEC. 804. EXTENSION OF MAXIMUM FUEL ECONOMY INCREASE FOR
ALTERNATIVE FUELED VEHICLES.

Section 32906(a)(1) of title 49, United States Code, is
amended--
(1) in subparagraph (A), by striking ``1993-2004'' and
inserting ``1993 through 2008''; and
(2) in subparagraph (B), by striking ``2005-2008'' and
inserting ``2009 through 2012''.

SEC. 805. PROCUREMENT OF ALTERNATIVE FUELED AND HYBRID LIGHT
DUTY TRUCKS.

(a) Vehicle Fleets Not Covered by Requirement in Energy
Policy Act of 1992.--
(1) Hybrid vehicles.--The head of each agency of the
executive branch shall coordinate with the Administrator of
General Services to ensure that only hybrid vehicles are
procured by or for each agency fleet of light duty trucks
that is not in a fleet of vehicles to which section 303 of
the Energy Policy Act of 1992 (42 U.S.C. 13212) applies.
(2) Waiver authority.--The head of an agency, in
consultation with the Administrator, may waive the
applicability of the policy regarding the procurement of
hybrid vehicles in paragraph (1) to that agency to the extent
that the head of that agency determines necessary--
(A) to meet specific requirements of the agency for
capabilities of light duty trucks;
(B) to procure vehicles consistent with the standards
applicable to the procurement of fleet vehicles for the
Federal Government;
(C) to adjust to limitations on the commercial availability
of light duty trucks that are hybrid vehicles; or
(D) to avoid the necessity of procuring a hybrid vehicle
for the agency when each of the hybrid vehicles available for
meeting the requirements of the agency has a cost to the
United States that exceeds the costs of comparable nonhybrid
vehicles by a factor that is significantly higher than the
difference between--
(i) the real cost of the hybrid vehicle to retail
purchasers, taking into account the benefit of any tax
incentives available to retail purchasers for the purchase of
the hybrid vehicle; and
(ii) the costs of the comparable nonhybrid vehicles to
retail purchasers.
(3) Applicability to procurements after fiscal year 2004.--
This subsection applies with respect to procurements of light
duty trucks in fiscal year 2005 and subsequent fiscal years.
(b) Requirement To Exceed Requirement in Energy Policy Act
of 1992.--
(1) Light duty trucks.--The head of each agency of the
executive branch shall coordinate with the Administrator of
General Services to ensure that, of the light duty trucks
procured in fiscal years after fiscal year 2004 for the
fleets of light duty vehicles of the agency to which section
303 of the Energy Policy Act of 1992 (42 U.S.C. 13212)
applies--
(A) 5 percent of the total number of such trucks that are
procured in each of fiscal years 2005 and 2006 are
alternative fueled vehicles or hybrid vehicles; and
(B) 10 percent of the total number of such trucks that are
procured in each fiscal year after fiscal year 2006 are
alternative fueled vehicles or hybrid vehicles.
(2) Counting of trucks.--Light duty trucks acquired for an
agency of the executive branch that are counted to comply
with section 303 of the Energy Policy Act of 1992 (42 U.S.C.
13212) for a fiscal year shall be counted to determine the
total number of light duty trucks procured for that agency
for that fiscal year for the purposes of paragraph (1), but
shall not be counted to satisfy the requirement in that
paragraph.
(c) Definitions.--In this section:
(1) Hybrid vehicle.--The term ``hybrid vehicle'' means--
(A) a motor vehicle that draws propulsion energy from
onboard sources of stored energy that are both--
(i) an internal combustion or heat engine using combustible
fuel; and
(ii) a rechargeable energy storage system; and
(B) any other vehicle that is defined as a hybrid vehicle
in regulations prescribed by the Secretary of Energy for the
administration of title III of the Energy Policy Act of 1992.
(2) Alternative fueled vehicle.--The term ``alternative
fueled vehicle'' has the meaning given that term in section
301 of the Energy Policy Act of 1992 (42 U.S.C. 13211).
(d) Inapplicability to Department of Defense.--This section
does not apply to the Department of Defense, which is subject
to comparable requirements under section 318 of the National
Defense Authorization Act for Fiscal Year 2002 (Public Law
107-107; 115 Stat. 1055; 10 U.S.C. 2302 note).

SEC. 806. USE OF ALTERNATIVE FUELS.

(a) Exclusive Use of Alternative Fuels in Dual Fueled
Vehicles.--The head of each agency of the executive branch
shall coordinate with the Administrator of General Services
to ensure that, not later than January 1, 2009, the fuel
actually used in the fleet of dual fueled vehicles used by
the agency is an alternative fuel.
(b) Waiver Authority.--
(1) Capability waiver.--
(A) Authority.--If the Secretary of Transportation
determines that not all of the dual fueled vehicles can
operate on alternative fuels at all times, the Secretary may
waive the requirement of subsection (a) in part, but only to
the extent that--
(i) not later than January 1, 2009, not less than 50
percent of the total annual volume of fuel used in the dual
fueled vehicles shall be alternative fuels; and
(ii) not later than January 1, 2011, not less than 75
percent of the total annual volume of fuel used in the dual
fueled vehicles shall be alternative fuels.
(B) Expiration.--In no case may a waiver under subparagraph
(A) remain in effect after December 31, 2012.
(2) Regional fuel availability waiver.--The Secretary may
waive the applicability of the requirement of subsection (a)
to vehicles used by an agency in a particular geographic area
where the alternative fuel otherwise required to be used in
the vehicles is not reasonably available to retail purchasers
of the fuel, as certified to the Secretary by the head of the
agency.
(c) Definitions.--In this section:
(1) Alternative fuel.--The term ``alternative fuel'' has
the meaning given that term in section 32901(a)(1) of title
49, United States Code.
(2) Dual fueled vehicle.--The term ``dual fueled vehicle''
has the meaning given the term ``dual fueled automobile'' in
section 32901(a)(8) of title 49, United States Code.
(3) Fleet.--The term ``fleet'', with respect to dual fueled
vehicles, has the meaning that is given that term with
respect to light duty motor vehicles in section 301(9) of the
Energy Policy Act of 1992 (42 U.S.C. 13211(9)).

SEC. 807. HYBRID ELECTRIC AND FUEL CELL VEHICLES.

(a) Expansion of Scope.--The Secretary of Energy shall
expand the research and development program of the Department
of Energy on advanced technologies for improving the
environmental cleanliness of vehicles to emphasize research
and development on the following:
(1) Fuel cells, including--
(A) high temperature membranes for fuel cells; and
(B) fuel cell auxiliary power systems.
(2) Hydrogen storage.
(3) Advanced vehicle engine and emission control systems.
(4) Advanced batteries and power electronics for hybrid
vehicles.
(5) Advanced fuels.
(6) Advanced materials.
(b) Authorization of Appropriations.--There is authorized
to be appropriated to the Department of Energy for fiscal
year 2003, the amount of $225,000,000 for carrying out the
expanded research and development program provided for under
this section.

SEC. 808. DIESEL FUELED VEHICLES.

(a) Diesel Combustion and After Treatment Technologies.--
The Secretary of Energy shall accelerate research and
development directed toward the improvement of diesel
combustion and after treatment technologies for use in diesel
fueled motor vehicles.
(b) Goal.--
(1) Compliance with tier 2 emission standards by 2010.--The
Secretary shall carry out subsection (a) with a view to
developing and demonstrating diesel technology meeting tier 2
emission standards not later than 2010.
(2) Tier 2 emission standards defined.--In this subsection,
the term ``tier 2 emission standards'' means the motor
vehicle emission standards promulgated by the Administrator
of the Environmental Protection Agency on February 10, 2000,
under sections 202 and 211 of the Clean Air Act to apply to
passenger cars, light trucks, and larger passenger vehicles
of model years after the 2003 vehicle model year.

SEC. 809. FUEL CELL DEMONSTRATION.

(a) Program Required.--The Secretary of Energy and the
Secretary of Defense shall jointly carry out a program to
demonstrate--
(1) fuel cell technologies developed in the PNGV and
Freedom Car programs;
(2) fuel cell technologies developed in research and
development programs of the Department of Defense; and
(3) follow-on fuel cell technologies.
(b) Purposes of Program.--The purposes of the program are
to identify and support technological advances that are
necessary to achieve accelerated availability of fuel cell
technology for use both for nonmilitary and military
purposes.
(c) Cooperation With Industry.--
(1) In general.--The demonstration program shall be carried
out in cooperation with industry, including the automobile
manufacturing industry and the automotive systems and
component suppliers industry.
(2) Cost sharing.--The Secretary of Energy and the
Secretary of Defense shall provide for industry to bear, in
cash or in kind, at least one-half of the total cost of
carrying out the demonstration program.
(d) Definitions.--In this section:
(1) PNGV program.--The term ``PNGV program'' means the
Partnership for a New Generation of Vehicles, a cooperative
program engaged in by the Departments of Commerce, Energy,
Transportation, and Defense, the Environmental Protection
Agency, the National Science

[[Page S10764]]

Foundation, and the National Aeronautics and Space
Administration with the automotive industry for the purpose
of developing a new generation of vehicles with capabilities
resulting in significantly improved fuel efficiency together
with low emissions without compromising the safety,
performance, affordability, or utility of the vehicles.
(2) Freedom car program.--The term ``Freedom Car program''
means a cooperative research program engaged in by the
Department of Energy with the United States Council on
Automotive Research as a follow-on to the PNGV program.

SEC. 810. BUS REPLACEMENT.

(a) Requirement for Study.--The Secretary of Transportation
shall carry out a study to determine how best to provide for
converting the composition of the fleets of buses in
metropolitan areas and school systems from buses utilizing
current diesel technology to--
(1) buses that draw propulsion from onboard fuel cells;
(2) buses that are hybrid electric vehicles;
(3) buses that are fueled by clean-burning fuels, such as
renewable fuels (including agriculture-based biodiesel
fuels), natural gas, and ultra-low sulphur diesel;
(4) buses that are powered by clean diesel engines: or
(5) an assortment of buses described in paragraphs (1),
(2), (3), and (4).
(b) Report.--
(1) Requirement.--The Secretary of Transportation shall
submit a report on the results of the study on bus fleet
conversions under subsection (a) to Congress.
(2) Content.--The report on bus fleet conversions shall
include the following:
(A) An assessment of effectuating conversions by the
following means:
(i) Replacement of buses.
(ii) Replacement of power and propulsion systems in buses
utilizing current diesel technology.
(iii) Other means.
(B) Feasible schedules for carrying out the conversions.
(C) Estimated costs of carrying out the conversions.
(D) An assessment of the benefits of the conversions in
terms of emissions control and reduction of fuel consumption.

SEC. 811. AVERAGE FUEL ECONOMY STANDARDS FOR PICKUP TRUCKS.

(a) In General.--Section 32902(a) of title 49, United
States Code, is amended--
(1) by inserting ``(1)'' after the after ``Automobiles.--
''; and
(2) by adding at the end the following new paragraph:
``(2) The average fuel economy standard for pickup trucks
manufactured by a manufacturer in a model year after model
year 2004 shall be no higher than 20.7 miles per gallon. No
average fuel economy standard prescribed under another
provision of this section shall apply to pickup trucks.''.
(b) Definition Of Pickup Truck.--Section 32901(a) of such
title is amended by adding at the end the following new
paragraph:
``(17) `pickup truck' has the meaning given that term in
regulations prescribed by the Secretary for the
administration of this chapter, as in effect on January 1,
2002, except that such term shall also include any additional
vehicle that the Secretary defines as a pickup truck in
regulations prescribed for the administration of this chapter
after such date.''.

SEC. 812. EXCEPTION TO HOV PASSENGER REQUIREMENTS FOR
ALTERNATIVE FUEL VEHICLES.

Section 102(a)(1) of title 23, United States Code, is
amended by inserting after ``required'' the following:
``(unless, in the discretion of the State transportation
department, the vehicle is being operated on, or is being
fueled by, an alternative fuel (as defined in section 301(2)
of the Energy Policy Act of 1992 (42 U.S.C. 13211(2)))''.

SEC. 813. DATA COLLECTION.

Section 205 of the Department of Energy Organization Act
(42 U.S.C. 7135) is amended by adding at the end the
following:
``(m) In order to improve the ability to evaluate the
effectiveness of the Nation's renewable fuels mandate, the
Administrator shall conduct and publish the results of a
survey of renewable fuels consumption in the motor vehicle
fuels market in the United States monthly, and in a manner
designed to protect the confidentiality of individual
responses. In conducting the survey, the Administrator shall
collect information retrospectively to 1998, both on a
national basis and a regional basis, including--
(1) the quantity of renewable fuels produced;
(2) the cost of production;
(3) the cost of blending and marketing;
(4) the quantity of renewable fuels blended;
(5) the quantity of renewable fuels imported; and
(6) market price data.

SEC. 814. GREEN SCHOOL BUS PILOT PROGRAM.

(a) Establishment.--The Secretary of Energy and the
Secretary of Transportation shall jointly establish a pilot
program for awarding grants on a competitive basis to
eligible entities for the demonstration and commercial
application of alternative fuel school buses and ultra-low
sulfur diesel school buses.
(b) Requirements.--Not later than 3 months after the date
of the enactment of this Act, the Secretary shall establish
and publish in the Federal Register grant requirements on
eligibility for assistance, and on implementation of the
program established under subsection (a), including
certification requirements to ensure compliance with this
subtitle.
(c) Solicitation.--Not later than 6 months after the date
of the enactment of this Act, the Secretary shall solicit
proposals for grants under this section.
(d) Eligible Recipients.--A grant shall be awarded under
this section only--
(1) to a local governmental entity responsible for
providing school bus service for one or more public school
systems; or
(2) jointly to an entity described in paragraph (1) and a
contracting entity that provides school bus service to the
public school system or systems.
(e) Types of Grants.--
(1) In general.--Grants under this section shall be for the
demonstration and commercial application of technologies to
facilitate the use of alternative fuel school buses and
ultra-low sulfur diesel school buses instead of buses
manufactured before model year 1977 and diesel-powered buses
manufactured before model year 1991.
(2) No economic benefit.--Other than the receipt of the
grant, a recipient of a grant under this section may not
receive any economic benefit in connection with the receipt
of the grant.
(3) Priority of grant applications.--The Secretary shall
give priority to awarding grants to applicants who can
demonstrate the use of alternative fuel buses and ultra-low
sulfur diesel school buses instead of buses manufactured
before model year 1977.
(f) Conditions of Grant.--A grant provided under this
section shall include the following conditions:
(1) All buses acquired with funds provided under the grant
shall be operated as part of the school bus fleet for which
the grant was made for a minimum of 5 years.
(2) Funds provided under the grant may only be used--
(A) to pay the cost, except as provided in paragraph (3),
of new alternative fuel school buses or ultra-low sulfur
diesel school buses, including State taxes and contract fees;
and
(B) to provide--
(i) up to 10 percent of the price of the alternative fuel
buses acquired, for necessary alternative fuel infrastructure
if the infrastructure will only be available to the grant
recipient; and
(ii) up to 15 percent of the price of the alternative fuel
buses acquired, for necessary alternative fuel infrastructure
if the infrastructure will be available to the grant
recipient and to other bus fleets.
(3) The grant recipient shall be required to provide at
least the lesser of 15 percent of the total cost of each bus
received or $15,000 per bus.
(4) In the case of a grant recipient receiving a grant to
demonstrate ultra-low sulfur diesel school buses, the grant
recipient shall be required to provide documentation to the
satisfaction of the Secretary that diesel fuel containing
sulfur at not more than 15 parts per million is available for
carrying out the purposes of the grant, and a commitment by
the applicant to use such fuel in carrying out the purposes
of the grant.
(g) Buses.--Funding under a grant made under this section
may only be used to demonstrate the use of new alternative
fuel school buses or ultra-low sulfur diesel school buses
that--
(1) have a gross vehicle weight greater than 14,000 pounds;
(2) are powered by a heavy duty engine;
(3) in the case of alternative fuel school buses, emit not
more than--
(A) for buses manufactured in model year 2002, 2.5 grams
per brake horsepower-hour of nonmethane hydrocarbons and
oxides of nitrogen and .01 grams per brake horsepower-hour of
particulate matter; and
(B) for buses manufactured in model years 2003 through
2006, 1.8 grams per brake horsepower-hour of nonmethane
hydrocarbons and oxides of nitrogen and .01 grams per brake
horsepower-hour of particulate matter; and
(4) in the case of ultra-low sulfur diesel school buses,
emit not more than the lesser of--
(A) the emissions of nonmethane hydrocarbons, oxides of
nitrogen, and particulate matter of the best performing
technology of the same class of ultra-low sulfur diesel
school buses commercially available at the time the grant is
made; or
(B) the applicable following amounts--
(i) for buses manufactured in model year 2002 or 2003, 3.0
grams per brake horsepower-hour of oxides of nitrogen and .01
grams per brake horsepower-hour of particulate matter; and
(ii) for buses manufactured in model years 2004 through
2006, 2.5 grams per brake horsepower-hour of nonmethane
hydrocarbons and oxides of nitrogen and .01 grams per brake
horsepower-hour of particulate matter.
(h) Deployment and Distribution.--The Secretary shall seek
to the maximum extent practicable to achieve nationwide
deployment of alternative fuel school buses through the
program under this section, and shall ensure a broad
geographic distribution of grant awards, with a goal of no
State receiving more than 10 percent of the grant funding
made available under this section for a fiscal year.
(i) Limit on Funding.--The Secretary shall provide not less
than 20 percent and not more than 25 percent of the grant
funding made available under this section for any fiscal year
for the acquisition of ultra-low sulfur diesel school buses.
(j) Definitions.--For purposes of this section--
(1) the term ``alternative fuel school bus'' means a bus
powered substantially by electricity (including electricity
supplied by a fuel cell), or by liquefied natural gas,
compressed natural gas, liquefied petroleum gas, hydrogen,
propane, or methanol or ethanol at no less than 85 percent by
volume;
(2) the term ``idling'' means not turning off an engine
while remaining stationary for more than approximately 3
minutes; and
(3) the term ``ultra-low sulfur diesel school bus'' means a
school bus powered by diesel fuel which contains sulfur at
not more than 15 parts per million.
(k) Reduction of School Bus Idling.--Each local educational
agency (as defined in section

[[Page S10765]]

9101 of the Elementary and Secondary Education Act of 1965
(20 U.S.C. 7801)) that receives Federal funds under the
Elementary and Secondary Education Act of 1965 (20 U.S.C.
6301 et seq.) is encouraged to develop a policy to reduce the
incidence of school buses idling at schools when picking up
and unloading students.

SEC. 815. FUEL CELL BUS DEVELOPMENT AND DEMONSTRATION
PROGRAM.

(a) Establishment of Program.--The Secretary shall
establish a program for entering into cooperative agreements
with private sector fuel cell bus developers for the
development of fuel cell-powered school buses, and
subsequently with not less than two units of local government
using natural gas-powered school buses and such private
sector fuel cell bus developers to demonstrate the use of
fuel cell-powered school buses.
(b) Cost Sharing.--The non-Federal contribution for
activities funded under this section shall be not less than--
(1) 20 percent for fuel infrastructure development
activities; and
(2) 50 percent for demonstration activities and for
development activities not described in paragraph (1).
(c) Funding.--No more than $25,000,000 of the amounts
authorized under section 815 may be used for carrying out
this section for the period encompassing fiscal years 2003
through 2006.
(d) Reports to Congress.--Not later than 3 years after the
date of the enactment of this Act, and not later than October
1, 2006, the Secretary shall transmit to the appropriate
congressional committees a report that--
(1) evaluates the process of converting natural gas
infrastructure to accommodate fuel cell-powered school buses;
and
(2) assesses the results of the development and
demonstration program under this section.

SEC. 816. AUTHORIZATION OF APPROPRIATIONS.

There are authorized to be appropriated to the Secretary of
Energy for carrying out sections 814 and 815, to remain
available until expended--
(1) $50,000,000 for fiscal year 2003;
(2) $60,000,000 for fiscal year 2004;
(3) $70,000,000 for fiscal year 2005; and
(4) $80,000,000 for fiscal year 2006.

SEC. 817. TEMPORARY BIODIESEL CREDIT EXPANSION.

(a) Biodiesel Credit Expansion.--Section 312(b) of the
Energy Policy Act of 1992 (42 U.S.C. 13220(b)) is amended by
striking paragraph (2) and inserting the following:
``(2) Use.--
``(A) In general.--A fleet or covered person--
``(i) may use credits allocated under subsection (a) to
satisfy more than 50 percent of the alternative fueled
vehicle requirements of a fleet or covered person under this
title, title IV, and title V; but
``(ii) may use credits allocated under subsection (a) to
satisfy 100 percent of the alternative fueled vehicle
requirements of a fleet or covered person under title V for 1
or more of model years 2002 through 2005.
``(B) Applicability.--Subparagraph (A) does not apply to a
fleet or covered person that is a biodiesel alternative fuel
provider described in section 501(a)(2)(A).''.
(b) Treatment as Section 508 Credits.--Section 312(c) of
the Energy Policy Act of 1992 (42 U.S.C. 13220(c)) is
amended--
(1) in the subsection heading, by striking ``Credit not''
and inserting ``Treatment as''; and
(2) by striking ``shall not be considered'' and inserting
``shall be treated as''.
(c) Alternative Fueled Vehicle Study and Report.--
(1) Definitions.--In this subsection:
(A) Alternative fuel.--The term ``alternative fuel'' has
the meaning given the term in section 301 of the Energy
Policy Act of 1992 (42 U.S.C. 13211).
(B) Alternative fueled vehicle.--The term ``alternative
fueled vehicle'' has the meaning given the term in section
301 of the Energy Policy Act of 1992 (42 U.S.C. 13211).
(C) Light duty motor vehicle.--The term ``light duty motor
vehicle'' has the meaning given the term in section 301 of
the Energy Policy Act of 1992 (42 U.S.C. 13211).
(D) Secretary.--The term ``Secretary'' means the Secretary
of Energy.
(2) Biodiesel credit extension study.--As soon as
practicable after the date of enactment of this Act, the
Secretary shall conduct a study--
(A) to determine the availability and cost of light duty
motor vehicles that qualify as alternative fueled vehicles
under title V of the Energy Policy Act of 1992 (42 U.S.C.
13251 et seq.); and
(B) to compare--
(i) the availability and cost of biodiesel; with
(ii) the availability and cost of fuels that qualify as
alternative fuels under title V of the Energy Policy Act of
1992 (42 U.S.C. 13251 et seq.).
(3) Report.--Not later than 1 year after the date of
enactment of this Act, the Secretary shall submit to Congress
a report that--
(A) describes the results of the study conducted under
paragraph (2); and
(B) includes any recommendations of the Secretary for
legislation to extend the temporary credit provided under
subsection (a) beyond model year 2005.

SEC. 818. NEIGHBORHOOD ELECTRIC VEHICLES.

Section 301 of the Energy Policy Act of 1992 (42 U.S.C.
13211) is amended--
(1) by striking ``or a dual fueled vehicle'' and inserting
``, a dual fueled vehicle, or a neighborhood electric
vehicle'';
(2) by striking ``and'' at the end of paragraph (13);
(3) by striking the period at the end of subparagraph (14)
and inserting ``; and''; and
(4) by adding at the end the following:
``(15) the term `neighborhood electric vehicle' means a
motor vehicle that qualifies as both--
``(A) a low-speed vehicle, as such term is defined in
section 571.3(b) of title 49, Code of Federal Regulations;
and
``(B) a zero-emission vehicle, as such term is defined in
section 86.1703-99 of title 40, Code of Federal
Regulations.''.

SEC. 819. CREDIT FOR HYBRID VEHICLES, DEDICATED ALTERNATIVE
FUEL VEHICLES, AND INFRASTRUCTURE.

Section 507 of the Energy Policy Act of 1992 (42 U.S.C.
13258) is amended by adding at the end the following:
``(p) Credits for New Qualified Hybrid Motor Vehicles.--
``(1) Definitions.--In this subsection:
``(A) 2000 model year city fuel efficiency.--The term `2000
model year city fuel efficiency', with respect to a motor
vehicle, means fuel efficiency determined in accordance with
the following tables:
``(i) In the case of a passenger automobile:
``If vehicle inertia                                The 2000 model year
weight class is:                               city fuel efficiency is:

1,500 or 1,750 lbs............................................43.7 mpg
2,000 lbs.....................................................38.3 mpg
2,250 lbs.....................................................34.1 mpg
2,500 lbs.....................................................30.7 mpg
2,750 lbs.....................................................27.9 mpg
3,000 lbs.....................................................25.6 mpg
3,500 lbs.....................................................22.0 mpg
4,000 lbs.....................................................19.3 mpg
4,500 lbs.....................................................17.2 mpg
5,000 lbs.....................................................15.5 mpg
5,500 lbs.....................................................14.1 mpg
6,000 lbs.....................................................12.9 mpg
6,500 lbs.....................................................11.9 mpg
7,000 to 8,500 lbs............................................11.1 mpg.

``(ii) In the case of a light truck:

``If vehicle inertia                                The 2000 model year
weight class is:                               city fuel efficiency is:
1,500 or 1,750 lbs............................................37.6 mpg
2,000 lbs.....................................................33.7 mpg
2,250 lbs.....................................................30.6 mpg
2,500 lbs.....................................................28.0 mpg
2,750 lbs.....................................................25.9 mpg
3,000 lbs.....................................................24.1 mpg
3,500 lbs.....................................................21.3 mpg
4,000 lbs.....................................................19.0 mpg
4,500 lbs.....................................................17.3 mpg
5,000 lbs.....................................................15.8 mpg
5,500 lbs.....................................................14.6 mpg
6,000 lbs.....................................................13.6 mpg
6,500 lbs.....................................................12.8 mpg
7,000 to 8,500 lbs............................................12.0 mpg.

``(B) Administrator.--The term `Administrator' means the
Administrator of the Environmental Protection Agency.
``(C) Energy storage device.--The term `energy storage
device' means an onboard rechargeable energy storage system
or similar storage device.
``(D) Fuel efficiency.--The term `fuel efficiency' means
the percentage increased fuel efficiency specified in table 1
in paragraph (2)(C) over the average 2000 model year city
fuel efficiency of vehicles in the same weight class.
``(E) Maximum available power.--The term `maximum available
power', with respect to a new qualified hybrid motor vehicle
that is a passenger vehicle or light truck, means the
quotient obtained by dividing--
``(i) the maximum power available from the electrical
storage device of the new qualified hybrid motor vehicle,
during a standard 10-second pulse power or equivalent test;
by
``(ii) the sum of--

``(I) the maximum power described in clause (i); and
``(II) the net power of the internal combustion or heat
engine, as determined in accordance with standards
established by the Society of Automobile Engineers.

``(F) Motor vehicle.--The term `motor vehicle' has the
meaning given the term in section 216 of the Clean Air Act
(42 U.S.C. 7550).
``(G) New qualified hybrid motor vehicle.--The term `new
qualified hybrid motor vehicle' means a motor vehicle that--
``(i) draws propulsion energy from both--

``(I) an internal combustion engine (or heat engine that
uses combustible fuel); and
``(II) an energy storage device;

``(ii) in the case of a passenger automobile or light
truck--

``(I) in the case of a 2001 or later model vehicle,
receives a certificate of conformity under the Clean Air Act
(42 U.S.C. 7401 et seq.) and produces emissions at a level
that is at or below the applicable qualifying California low
emissions vehicle standards established under authority of
section 243(e)(2) of the Clean Air Act (42 U.S.C. 7583(e)(2))
for that make and model year; and
``(II) in the case of a 2004 or later model vehicle, is
certified by the Administrator as producing emissions at a
level that is at or below the level established for Bin 5
vehicles in the Tier 2 regulations promulgated by the
Administrator under section 202(i) of the Clean Air Act (42
U.S.C. 7521(i)) for that make and model year vehicle; and

``(iii) employs a vehicle braking system that recovers
waste energy to charge an energy storage device.
``(H) Vehicle inertia weight class.--The term `vehicle
inertia weight class' has the meaning given the term in
regulations promulgated by the Administrator for purposes of
the administration of title II of the Clean Air Act (42
U.S.C. 7521 et seq.).
``(2) Allocation.--
``(A) In general.--The Secretary shall allocate a partial
credit to a fleet or covered person

[[Page S10766]]

under this title if the fleet or person acquires a new
qualified hybrid motor vehicle that is eligible to receive a
credit under each of the tables in subparagraph (C).
``(B) Amount.--The amount of a partial credit allocated
under subparagraph (A) for a vehicle described in that
subparagraph shall be equal to the sum of--
``(i) the partial credits determined under table 1 in
subparagraph (C); and
``(ii) the partial credits determined under table 2 in
subparagraph (C).
``(C) Tables.--The tables referred to in subparagraphs (A)
and (B) are as follows:

``Table 1

``Partial credit for in-                                      Amount of
creased fuel effi-                                              credit:
ciency:
At least 125% but less than 150% of 2000 model year city fuel
efficiency....................................................0.14
At least 150% but less than 175% of 2000 model year city fuel
efficiency....................................................0.21
At least 175% but less than 200% of 2000 model year city fuel
efficiency....................................................0.28
At least 200% but less than 225% of 2000 model year city fuel
efficiency....................................................0.35
At least 225% but less than 250% of 2000 model year city fuel
efficiency....................................................0.50.

``Table 2

``Partial credit for                                          Amount of
`Maximum Avail-                                                 credit:
able Power':
At least 5% but less than 10%..................................0.125
At least 10% but less than 20%.................................0.250
At least 20% but less than 30%.................................0.375
At least 30% or more...........................................0.500.

``(D) Use of credits.--At the request of a fleet or covered
person allocated a credit under this subsection, the
Secretary shall, for the year in which the acquisition of the
qualified hybrid motor vehicle is made, treat that credit as
the acquisition of 1 alternative fueled vehicle that the
fleet or covered person is required to acquire under this
title.
``(3) Regulations.--The Secretary shall promulgate
regulations under which any Federal fleet that acquires a new
qualified hybrid motor vehicle will receive partial credits
determined under the tables contained in paragraph (2)(C) for
purposes of meeting the requirements of section 303.
``(q) Credit for Substantial Contribution Towards Use of
Dedicated Vehicles in Noncovered Fleets.--
``(1) Definitions.--In this subsection:
``(A) Dedicated vehicle.--The term `dedicated vehicle'
includes--
``(i) a light, medium, or heavy duty vehicle; and
``(ii) a neighborhood electric vehicle.
``(B) Medium or heavy duty vehicle.--The term `medium or
heavy duty vehicle' includes a vehicle that--
``(i) operates solely on alternative fuel; and
``(ii)(I) in the case of a medium duty vehicle, has a gross
vehicle weight rating of more than 8,500 pounds but not more
than 14,000 pounds; or
``(II) in the case of a heavy duty vehicle, has a gross
vehicle weight rating of more than 14,000 pounds.
``(C) Substantial contribution.--The term `substantial
contribution' (equal to 1 full credit) means not less than
$15,000 in cash or in kind services, as determined by the
Secretary.
``(2) Issuance of credits.--The Secretary shall issue a
credit to a fleet or covered person under this title if the
fleet or person makes a substantial contribution toward the
acquisition and use of dedicated vehicles by a person that
owns, operates, leases, or otherwise controls a fleet that is
not covered by this title.
``(3) Multiple credits for medium and heavy duty dedicated
vehicles.--The Secretary shall issue 2 full credits to a
fleet or covered person under this title if the fleet or
person acquires a medium or heavy duty dedicated vehicle.
``(4) Use of credits.--At the request of a fleet or covered
person allocated a credit under this subsection, the
Secretary shall, for the year in which the acquisition of the
dedicated vehicle is made, treat that credit as the
acquisition of 1 alternative fueled vehicle that the fleet or
covered person is required to acquire under this title.
``(5) Limitation.--Per vehicle credits acquired under this
subsection shall not exceed the per vehicle credits allowed
under this section to a fleet for qualifying vehicles in each
of the weight categories (light, medium, or heavy duty).
``(r) Credit for Substantial Investment in Alternative Fuel
Infrastructure.--
``(1) Definitions.--In this section, the term `qualifying
infrastructure' means--
``(A) equipment required to refuel or recharge alternative
fueled vehicles;
``(B) facilities or equipment required to maintain, repair,
or operate alternative fueled vehicles;
``(C) training programs, educational materials, or other
activities necessary to provide information regarding the
operation, maintenance, or benefits associated with
alternative fueled vehicles; and
``(D) such other activities the Secretary considers to
constitute an appropriate expenditure in support of the
operation, maintenance, or further widespread adoption of or
utilization of alternative fueled vehicles.
``(2) Issuance of credits.--The Secretary shall issue a
credit to a fleet or covered person under this title for
investment in qualifying infrastructure if the qualifying
infrastructure is open to the general public during regular
business hours.
``(3) Amount.--For the purposes of credits under this
subsection--
``(A) 1 credit shall be equal to a minimum investment of
$25,000 in cash or in kind services, as determined by the
Secretary; and
``(B) except in the case of a Federal or State fleet, no
part of the investment may be provided by Federal or State
funds.
``(4) Use of credits.--At the request of a fleet or covered
person allocated a credit under this subsection, the
Secretary shall, for the year in which the investment is
made, treat that credit as the acquisition of 1 alternative
fueled vehicle that the fleet or covered person is required
to acquire under this title.''.

SEC. 820. RENEWABLE CONTENT OF MOTOR VEHICLE FUEL.

(a) In General.--Section 211 of the Clean Air Act (42
U.S.C. 7545) is amended--
(1) by redesignating subsection (o) as subsection (q); and
(2) by inserting after subsection (n) the following:
``(o) Renewable Fuel Pprogram.--
``(1) Definitions.--In this section:
``(A) Cellulosic biomass ethanol.--The term `cellulosic
biomass ethanol' means ethanol derived from any
lignocellulosic or hemicellulosic matter that is available on
a renewable or recurring basis, including--
``(i) dedicated energy crops and trees;
``(ii) wood and wood residues;
``(iii) plants;
``(iv) grasses;
``(v) agricultural residues;
``(vi) fibers;
``(vii) animal wastes and other waste materials; and
``(viii) municipal solid waste.
``(B) Renewable fuel.--
``(i) In general.--The term `renewable fuel' means motor
vehicle fuel that--

``(I)(aa) is produced from grain, starch, oilseeds, or
other biomass; or
``(bb) is natural gas produced from a biogas source,
including a landfill, sewage waste treatment plant, feedlot,
or other place where decaying organic material is found; and
``(II) is used to replace or reduce the quantity of fossil
fuel present in a fuel mixture used to operate a motor
vehicle.

``(ii) Inclusion.--The term `renewable fuel' includes
cellulosic biomass ethanol and biodiesel (as defined in
section 312(f) of the Energy Policy Act of 1992 (42 U.S.C.
13220(f)).
``(C) Small refinery.--The term `small refinery' means a
refinery for which average aggregate daily crude oil
throughput for the calendar year (as determined by dividing
the aggregate throughput for the calendar year by the number
of days in the calendar year) does not exceed 75,000 barrels.
``(2) Renewable fuel program.--
``(A) In general.--Not later than 1 year from enactment of
this provision, the Administrator shall promulgate
regulations ensuring that gasoline sold or dispensed to
consumers in the United States, on an annual average basis,
contains the applicable volume of renewable fuel as specified
in subparagraph (B). Regardless of the date of promulgation,
such regulations shall contain compliance provisions for
refiners, blenders, and importers, as appropriate, to ensure
that the requirements of this section are met, but shall not
restrict where renewables can be used, or impose any per-
gallon obligation for the use of renewables. If the
Administrator does not promulgate such regulations, the
applicable percentage, on a volume percentage of gasoline
basis, shall be 1.62 in 2004.
``(B) Applicable volume.--
(i) Calendar years 2004 through 2012.--For the purpose of
subparagraph (A), the applicable volume for any of calendar
years 2004 through 2012 shall be determined in accordance
with the following table:

Applicable volume of renewable fuel

``Calendar year:                             (In billions of gallons)
2004...........................................................2.3
2005...........................................................2.6
2006...........................................................2.9
2007...........................................................3.2
2008...........................................................3.5
2009...........................................................3.9
2010...........................................................4.3
2011...........................................................4.7
2012...........................................................5.0.

``(ii) Calendar year 2013 and thereafter.--For the purpose
of subparagraph (A), the applicable volume for calendar year
2013 and each calendar year thereafter shall be equal to the
product obtained by multiplying--

``(I) the number of gallons of gasoline that the
Administrator estimates will be sold or introduced into
commerce in the calendar year; and
``(II) the ratio that--

``(aa) 5.0 billion gallons of renewable fuels; bears to
``(bb) the number of gallons of gasoline sold or introduced
into commerce in calendar year 2012.
``(3) Applicable percentages.--Not later than October 31 of
each calendar year, through 2011, the Administrator of the
Energy Information Administration shall provide the
Administrator an estimate of the volumes of gasoline sales in
the United States for the coming calendar year. Based on such
estimates, the Administrator shall by November 30 of each
calendar year, through 2011, determine and publish in the
Federal Register, the renewable fuel obligation, on a volume
percentage of gasoline basis, applicable to refiners,
blenders, distributors and importers, as appropriate, for the
coming calendar year, to ensure that the requirements of
paragraph (2) are met. For each calendar year, the
Administrator shall establish a

[[Page S10767]]

single applicable percentage that applies to all parties, and
make provision to avoid redundant obligations. In determining
the applicable percentages, the Administrator shall make
adjustments to account for the use of renewable fuels by
exempt small refineries during the previous year.
``(4) Cellulosic biomass ethanol.--For the purpose of
paragraph (2), 1 gallon of cellulosic biomass ethanol shall
be considered to be the equivalent of 1.5 gallon of renewable
fuel.
``(5) Credit program.--
``(A) In general.--The regulations promulgated to carry out
this subsection shall provide for the generation of an
appropriate amount of credits by any person that refines,
blends, or imports gasoline that contains a quantity of
renewable fuel that is greater than the quantity required
under paragraph (2). Such regulations shall provide for the
generation of an appropriate amount of credits for biodiesel
fuel. If a small refinery notifies the Administrator that it
waives the exemption provided by this Act, the regulations
shall provide for the generation of credits by the small
refinery beginning in the year following such notification.
``(B) Use of credits.--A person that generates credits
under subparagraph (A) may use the credits, or transfer all
or a portion of the credits to another person, for the
purpose of complying with paragraph (2).
``(C) Life of credits.--A credit generated under this
paragraph shall be valid to show compliance:
(i) in the calendar year in which the credit was generated
or the next calendar year, or
(ii) in the calendar year in which the credit was generated
or next two consecutive calendar years if the Administrator
promulgates regulations under paragraph (6).
``(D) Inability to purchase sufficient credits.--The
regulations promulgated to carry out this subsection shall
include provisions allowing any person that is unable to
generate or purchase sufficient credits to meet the
requirements under paragraph (2) to carry forward a
renewables deficit provided that, in the calendar year
following the year in which the renewables deficit is
created, such person shall achieve compliance with the
renewables requirement under paragraph (2), and shall
generate or purchase additional renewables credits to offset
the renewables deficit of the previous year.
``(6) Seasonal variations in renewable fuel use.--
``(A) Study.--For each of calendar years 2004 through 2012,
the Administrator of the Energy Information Administration,
shall conduct a study of renewable fuels blending to
determine whether there are excessive seasonal variations in
the use of renewable fuels.
``(B) Regulation of excessive seasonal variations.--If, for
any calendar year, the Administrator of the Energy
Information Administration, based on the study under
subparagraph (A), makes the determinations specified in
subparagraph (C), the Administrator shall promulgate
regulations to ensure that 35 percent or more of the quantity
of renewable fuels necessary to meet the requirement of
paragraph (2) is used during each of the periods specified in
subparagraph (D) of each subsequent calendar year.
``(C) Determinations.--The determinations referred to in
subparagraph (B) are that--
``(i) less than 35 percent of the quantity of renewable
fuels necessary to meet the requirement of paragraph (2) has
been used during one of the periods specified in subparagraph
(D) of the calendar year; and
``(ii) a pattern of excessive seasonal variation described
in clause (i) will continue in subsequent calendar years.
``(D) Periods.--The two periods referred to in this
paragraph are--
``(i) April through September; and
``(ii) January through March and October through December.
``(E) Exclusions.--Renewable fuels blended or consumed in
2004 in a state which has received a waiver under section
209(b) shall not be included in the study in subparagraph
(A).
``(7) Waivers.--
``(A) In general.--The Administrator, in consultation with
the Secretary of Agriculture and the Secretary of Energy, may
waive the requirement of paragraph (2) in whole or in part on
petition by one or more States by reducing the national
quantity of renewable fuel required under this subsection--
``(i) based on a determination by the Administrator, after
public notice and opportunity for comment, that
implementation of the requirement would severely harm the
economy or environment of a State, a region, or the United
States; or
``(ii) based on a determination by the Administrator, after
public notice and opportunity for comment, that there is an
inadequate domestic supply or distribution capacity to meet
the requirement.
``(B) Petitions for waivers.--The Administrator, in
consultation with the Secretary of Agriculture and the
Secretary of Energy, shall approve or disapprove a State
petition for a waiver of the requirement of paragraph (2)
within 90 days after the date on which the petition is
received by the Administrator.
``(C) Termination of waivers.--A waiver granted under
subparagraph (A) shall terminate after 1 year, but may be
renewed by the Administrator after consultation with the
Secretary of Agriculture and the Secretary of Energy.
``(8) Study and waiver for initial year of program.--Not
later than 180 days from enactment, the Secretary of Energy
shall complete for the Administrator a study assessing
whether the renewable fuels requirement under paragraph (2)
will likely result in significant adverse consumer impacts in
2004, on a national, regional or state basis. Such study
shall evaluate renewable fuel supplies and prices, blendstock
supplies, and supply and distribution system capabilities.
Based on such study, the Secretary shall make specific
recommendations to the Administrator regarding waiver of the
requirements of paragraph (2), in whole or in part, to avoid
any such adverse impacts. Within 270 days from enactment, the
Administrator shall, consistent with the recommendations of
the Secretary waive, in whole or in part, the renewable fuels
requirement under paragraph (2) by reducing the national
quantity of renewable fuel required under this subsection in
2004. This provision shall not be interpreted as limiting the
Administrator's authority to waive the requirements of
paragraph (2) in whole, or in part, under paragraph (7),
pertaining to waivers.
``(9) Small refineries.--
``(A) In general.--The requirement of paragraph (2) shall
not apply to small refineries until January 1, 2008. Not
later than December 31, 2006, the Secretary of Energy shall
complete for the Administrator a study to determine whether
the requirement of paragraph (2) would impose a
disproportionate economic hardship on small refineries. For
any small refinery that the Secretary of Energy determines
would experience a disproportionate economic hardship, the
Administrator shall extend the small refinery exemption for
such small refinery for no less than two additional years.
``(B) Economic hardship.--
``(i) Extension of exemption.--A small refinery may at any
time petition the Administrator for an extension of the
exemption from the requirement of paragraph (2) for the
reason of disproportionate economic hardship. In evaluating a
hardship petition, the Administrator, in consultation with
the Secretary of Energy, shall consider the findings of the
study in addition to other economic factors.
``(ii) Deadline for action on petitions.--The Administrator
shall act on any petition submitted by a small refinery for a
hardship exemption not later than 90 days after the receipt
of the petition.
``(C) Credit program.--If a small refinery notifies the
Administrator that it waives the exemption provided by this
Act, the regulations shall provide for the generation of
credits by the small refinery beginning in the year following
such notification.
``(D) Opt-in for small refiners.--A small refinery shall be
subject to the requirements of this section if it notifies
the Administrator that it waives the exemption under
subparagraph (A).
(b) Penalties and Enforcement.--Section 211(d) of the Clean
Air Act (42 U.S.C. 7545(d)) is amended--
(1) in paragraph (1)--
(A) in the first sentence, by striking ``or (n)'' each
place it appears and inserting ``(n) or (o)''; and
(B) in the second sentence, by striking ``or (m)'' and
inserting ``(m), or (o)''; and
(2) in the first sentence of paragraph (2), by striking
``and (n)'' each place it appears and inserting ``(n), and
(o)''.
(c) Exclusion From Ethanol Waiver.--Section 211(h) of the
Clean Air Act (42 U.S.C. 7545(h)) is amended--
(1) by redesignating paragraph (5) as paragraph (6); and
(2) by inserting after paragraph (4) the following:
``(5) Exclusion from ethanol waiver.--
``(A) Promulgation of regulations.--Upon notification,
accompanied by supporting documentation, from the Governor of
a State that the Reid vapor pressure limitation established
by paragraph (4) will increase emissions that contribute to
air pollution in any area in the State, the Administrator
shall, by regulation, apply, in lieu of the Reid vapor
pressure limitation established by paragraph (4), the Reid
vapor pressure limitation established by paragraph (1) to all
fuel blends containing gasoline and 10 percent denatured
anhydrous ethanol that are sold, offered for sale, dispensed,
supplied, offered for supply, transported or introduced into
commerce in the area during the high ozone season.
``(B) Deadline for promulgation.--The Administrator shall
promulgate regulations under subparagraph (A) not later than
90 days after the date of receipt of a notification from a
Governor under that subparagraph.
``(C) Effective date.--
``(i) In general.--With respect to an area in a State for
which the Governor submits a notification under subparagraph
(A), the regulations under that subparagraph shall take
effect on the later of--

``(I) the first day of the first high ozone season for the
area that begins after the date of receipt of the
notification; or
``(II) 1 year after the date of receipt of the
notification.

``(ii) Extension of effective date based on determination
of insufficient supply.--

``(I) In general.--If, after receipt of a notification with
respect to an area from a Governor of a State under
subparagraph (A), the Administrator determines, on the
Administrator's own motion or on petition of any person and
after consultation with the Secretary of Energy, that the
promulgation of regulations described in subparagraph (A)
would result in an insufficient supply of gasoline in the
State, the Administrator, by regulation--

``(aa) shall extend the effective date of the regulations
under clause (i) with respect to the area for not more than 1
year; and
``(bb) may renew the extension under item (aa) for two
additional periods, each of which shall not exceed 1 year.

``(II) Deadline for action on petitions.--The Administrator
shall act on any petition submitted under subclause (I) not
later than 180 days after the date of receipt of the
petition.''.

(d) Survey of Renewable Fuel Market.--
(1) Survey and report.--Not later than December 1, 2005,
and annually thereafter, the Administrator shall--

[[Page S10768]]

(A) conduct, with respect to each conventional gasoline use
area and each reformulated gasoline use area in each State, a
survey to determine the market shares of--
(i) conventional gasoline containing ethanol;
(ii) reformulated gasoline containing ethanol;
(iii) conventional gasoline containing renewable fuel; and
(iv) reformulated gasoline containing renewable fuel; and
(B) submit to Congress, and make publicly available, a
report on the results of the survey under subparagraph (A).
(2) Recordkeeping and reporting requirements.--The
Administrator may require any refiner, blender, or importer
to keep such records and make such reports as are necessary
to ensure that the survey conducted under paragraph (1) is
accurate. The Administrator shall rely, to the extent
practicable, on existing reporting and recordkeeping
requirements to avoid duplicative requirements.
(3) Applicable law.--Activities carried out under this
subsection shall be conducted in a manner designed to protect
confidentiality of individual responses.
(e) Renewable Fuels Safe Harbor.--
(1) In general.--Notwithstanding any other provision of
federal or state law, no renewable fuel, as defined by this
Act, used or intended to be used as a motor vehicle fuel, nor
any motor vehicle fuel containing such renewable fuel, shall
be deemed defective in design or manufacture by virtue of the
fact that it is, or contains, such a renewable fuel, if it
does not violate a control or prohibition imposed by the
Administrator under section 211 of the Clean Air Act, as
amended by this Act, and the manufacturer is in compliance
with all requests for information under section 211(b) of the
Clean Air Act, as amended by this Act. In the event that the
safe harbor under this section does not apply, the existence
of a design defect or manufacturing defect shall be
determined under otherwise applicable law.
(2) Exceptions.--This subsection shall not apply to ethers.
(3) Effective date.--This subsection shall be effective as
of the date of enactment and shall apply with respect to all
claims filed on or after that date.

SEC. 820A. FEDERAL AGENCY ETHANOL-BLENDED GASOLINE AND
BIODIESEL PURCHASING REQUIREMENT.

Title III of the Energy Policy Act of 1992 is amended by
striking section 306 (42 U.S.C. 13215) and inserting the
following:

``SEC. 306. FEDERAL AGENCY ETHANOL-BLENDED GASOLINE AND
BIODIESEL PURCHASING REQUIREMENT.

``(a) Ethanol-Blended Gasoline.--The head of each Federal
agency shall ensure that, in areas in which ethanol-blended
gasoline is reasonably available at a generally competitive
price, the Federal agency purchases ethanol-blended gasoline
containing at least 10 percent ethanol rather than
nonethanol-blended gasoline, for use in vehicles used by the
agency that use gasoline.
``(b) Biodiesel.--
``(1) Definition of biodiesel.--In this subsection, the
term `biodiesel' has the meaning given the term in section
312(f).
``(2) Requirement.--The head of each Federal agency shall
ensure that the Federal agency purchases, for use in fueling
fleet vehicles that use diesel fuel used by the Federal
agency at the location at which fleet vehicles of the Federal
agency are centrally fueled, in areas in which the biodiesel-
blended diesel fuel described in paragraphs (A) and (B) is
available at a generally competitive price--
``(A) as of the date that is 5 years after the date of
enactment of this paragraph, biodiesel-blended diesel fuel
that contains at least 2 percent biodiesel, rather than
nonbiodiesel-blended diesel fuel; and
``(B) as of the date that is 10 years after the date of
enactment of this paragraph, biodiesel-blended diesel fuel
that contains at least 20 percent biodiesel, rather than
nonbiodiesel-blended diesel fuel.
``(3) Requirement of Federal Law.--The provisions of this
subsection shall not be considered a requirement of Federal
law for the purposes of section 312.
``(c) Exemption.--This section does not apply to fuel used
in vehicles excluded from the definition of `fleet' by
subparagraphs (A) through (H) of section 301(9).''.

SEC. 820B. COMMERCIAL BYPRODUCTS FROM MUNICIPAL SOLID WASTE
LOAN GUARANTEE PROGRAM.

(a) Definition of Municipal Solid Waste.--In this section,
the term ``municipal solid waste'' has the meaning given the
term ``solid waste'' in section 1004 of the Solid Waste
Disposal Act (42 U.S.C. 6903).
(b) Establishment of Program.--The Secretary of Energy
shall establish a program to provide guarantees of loans by
private institutions for the construction of facilities for
the processing and conversion of municipal solid waste into
fuel ethanol and other commercial byproducts.
(c) Requirements.--The Secretary may provide a loan
guarantee under subsection (b) to an applicant if--
(1) without a loan guarantee, credit is not available to
the applicant under reasonable terms or conditions sufficient
to finance the construction of a facility described in
subsection (b);
(2) the prospective earning power of the applicant and the
character and value of the security pledged provide a
reasonable assurance of repayment of the loan to be
guaranteed in accordance with the terms of the loan; and
(3) the loan bears interest at a rate determined by the
Secretary to be reasonable, taking into account the current
average yield on outstanding obligations of the United States
with remaining periods of maturity comparable to the maturity
of the loan.
(d) Criteria.--In selecting recipients of loan guarantees
from among applicants, the Secretary shall give preference to
proposals that--
(1) meet all applicable Federal and State permitting
requirements;
(2) are most likely to be successful; and
(3) are located in local markets that have the greatest
need for the facility because of--
(A) the limited availability of land for waste disposal; or
(B) a high level of demand for fuel ethanol or other
commercial byproducts of the facility.
(e) Maturity.--A loan guaranteed under subsection (b) shall
have a maturity of not more than 20 years.
(f) Terms and Conditions.--The loan agreement for a loan
guaranteed under subsection (b) shall provide that no
provision of the loan agreement may be amended or waived
without the consent of the Secretary.
(g) Assurance of Repayment.--The Secretary shall require
that an applicant for a loan guarantee under subsection (b)
provide an assurance of repayment in the form of a
performance bond, insurance, collateral, or other means
acceptable to the Secretary in an amount equal to not less
than 20 percent of the amount of the loan.
(h) Guarantee Fee.--The recipient of a loan guarantee under
subsection (b) shall pay the Secretary an amount determined
by the Secretary to be sufficient to cover the administrative
costs of the Secretary relating to the loan guarantee.
(i) Full Faith and Credit.--The full faith and credit of
the United States is pledged to the payment of all guarantees
made under this section. Any such guarantee made by the
Secretary shall be conclusive evidence of the eligibility of
the loan for the guarantee with respect to principal and
interest. The validity of the guarantee shall be
incontestable in the hands of a holder of the guaranteed
loan.
(j) Reports.--Until each guaranteed loan under this section
has been repaid in full, the Secretary shall annually submit
to Congress an report on the activities of the Secretary
under this section.
(k) Authorization of Appropriations.--There are authorized
to be appropriated such sums as are necessary to carry out
this section.
(l) Termination of Authority.--The authority of the
Secretary to issue a loan guarantee under subsection (b)
terminates on the date that is 10 years after the date of
enactment of this Act.

Subtitle B--Additional Fuel Efficiency Measures

SEC. 821. FUEL EFFICIENCY OF THE FEDERAL FLEET OF
AUTOMOBILES.

Section 32917 of title 49, United States Code, is amended
to read as follows:

``Sec. 32917. Standards for executive agency automobiles

``(a) Baseline Average Fuel Economy.--The head of each
executive agency shall determine, for all automobiles in the
agency's fleet of automobiles that were leased or bought as a
new vehicle in fiscal year 1999, the average fuel economy for
such automobiles. For the purposes of this section, the
average fuel economy so determined shall be the baseline
average fuel economy for the agency's fleet of automobiles.
``(b) Increase of Average Fuel Economy.--The head of an
executive agency shall manage the procurement of automobiles
for that agency in such a manner that--
``(1) not later than September 30, 2003, the average fuel
economy of the new automobiles in the agency's fleet of
automobiles is not less than 1 mile per gallon higher than
the baseline average fuel economy determined under subsection
(a) for that fleet; and
``(2) not later than September 30, 2005, the average fuel
economy of the new automobiles in the agency's fleet of
automobiles is not less than 3 miles per gallon higher than
the baseline average fuel economy determined under subsection
(a) for that fleet.
``(c) Calculation of Average Fuel Economy.--Average fuel
economy shall be calculated for the purposes of this section
in accordance with guidance which the Secretary of
Transportation shall prescribe for the implementation of this
section.
``(d) Definitions.--In this section:
``(1) The term `automobile' does not include any vehicle
designed for combat-related missions, law enforcement work,
or emergency rescue work.
``(2) The term `executive agency' has the meaning given
that term in section 105 of title 5.
``(3) The term `new automobile', with respect to the fleet
of automobiles of an executive agency, means an automobile
that is leased for at least 60 consecutive days or bought, by
or for the agency, after September 30, 1999.''.

SEC. 822. IDLING REDUCTION SYSTEMS IN HEAVY DUTY VEHICLES.

Title III of the Energy Policy and Conservation Act (42
U.S.C. 6291 et seq.) is amended by adding at the end the
following:

``PART K--REDUCING TRUCK IDLING

``SEC. 400AAA. REDUCING TRUCK IDLING.

``(a) Study.--Not later than 18 months after the date of
enactment of this section, the Secretary shall, in
consultation with the Secretary of Transportation, commence a
study to analyze the potential fuel savings resulting from
long duration idling of main drive engines in heavy-duty
vehicles.
``(b) Regulations.--Upon completion of the study under
subsection (a), the Secretary may issue regulations requiring
the installation of idling reduction systems on all newly
manufactured heavy-duty vehicles.
``(c) Definitions.--As used in this section:
``(1) The term `heavy-duty vehicle' means a vehicle that
has a gross vehicle weight rating

[[Page S10769]]

greater than 8,500 pounds and is powered by a diesel engine.
``(2) The term `idling reduction system' means a device or
system of devices used to reduce long duration idling of a
diesel engine in a vehicle.
``(3) The term `long duration idling' means the operation
of a main drive engine of a heavy-duty vehicle for a period
of more than 15 consecutive minutes when the main drive
engine is not engaged in gear, except that such term does not
include idling as a result of traffic congestion or other
impediments to the movement of a heavy-duty vehicle.
``(4) The term `vehicle' has the meaning given such term in
section 4 of title 1, United States Code.''.

SEC. 823. CONSERVE BY BICYCLING PROGRAM.

(a) Establishment.--The Secretary of Transportation shall
establish a Conserve By Bicycling pilot program that shall
provide for up to 10 geographically dispersed projects to
encourage the use of bicycles in place of motor vehicles.
Such projects shall use education and marketing to convert
motor vehicle trips to bike trips, document project results
and energy savings, and facilitate partnerships among
entities in the fields of transportation, law enforcement,
education, public health, environment, or energy. At least 20
percent of the cost of each project shall be provided from
State or local sources. Not later than 2 years after
implementation of the projects, the Secretary of
Transportation shall submit a report to Congress on the
results of the pilot program.
(b) National Academy Study.--The Secretary of
Transportation shall contract with the National Academy of
Sciences to conduct a study on the feasibility and benefits
of converting motor vehicle trips to bicycle trips and to
issue a report, not later than 2 years after enactment of
this Act, on the findings of such study.
(c) Authorization of Appropriations.--There is authorized
to be appropriated to the Secretary of' Transportation
$5,500,000, to remain available until expended, to carry out
the pilot program and study pursuant to this section.

SEC. 824. FUEL CELL VEHICLE PROGRAM.

Not later than 1 year from date of enactment of this
section, the Secretary shall develop a program with
timetables for developing technologies to enable at least
100,000 hydrogen-fueled fuel cell vehicles to be available
for sale in the United States by 2010 and at least 2.5
million of such vehicles to be available by 2020 and annually
thereafter. The program shall also include timetables for
development of technologies to provide 50 million gasoline
equivalent gallons of hydrogen for sale in fueling stations
in the United States by 2010 and at least 2.5 billion
gasoline equivalent gallons by 2020 and annually thereafter.
The Secretary shall annually include a review of the progress
toward meeting the vehicle sales of Energy budget.

Subtitle C--Federal Reformulated Fuels

SEC. 831. SHORT TITLE.

This subtitle may be cited as the ``Federal Reformulated
Fuels Act of 2003''.

SEC. 832. LEAKING UNDERGROUND STORAGE TANKS.

(a) Use of Lust Funds for Remediation of Contamination From
Ether Fuel Additives.--Section 9003(h) of the Solid Waste
Disposal Act (42 U.S.C. 6991b(h)) is amended--
(1) in paragraph (7)(A)--
(A) by striking ``paragraphs (1) and (2) of this
subsection'' and inserting ``paragraphs (1), (2), and (12)'';
and
(B) by inserting ``and section 9010'' before ``if''; and
(2) by adding at the end the following:
``(12) Remediation of contamination from ether fuel
additives.--
``(A) In general.--The Administrator and the States may use
funds made available under section 9013(1) to carry out
corrective actions with respect to a release of methyl
tertiary butyl ether or other ether fuel additive that
presents a threat to human health, welfare, or the
environment.
``(B) Applicable authority.--Subparagraph (A) shall be
carried out--
``(i) in accordance with paragraph (2), except that a
release with respect to which a corrective action is carried
out under subparagraph (A) shall not be required to be from
an underground storage tank; and
``(ii) in the case of a State, in accordance with a
cooperative agreement entered into by the Administrator and
the State under paragraph (7).''.
(b) Release Prevention and Compliance.--Subtitle I of the
Solid Waste Disposal Act (42 U.S.C. 6991 et seq.) is amended
by striking section 9010 and inserting the following:

``SEC. 9010. RELEASE PREVENTION AND COMPLIANCE.

``Funds made available under section 9013(2) from the
Leaking Underground Storage Tank Trust Fund may be used for
conducting inspections, or for issuing orders or bringing
actions under this subtitle--
``(1) by a State (pursuant to section 9003(h)(7)) acting
under--
``(A) a program approved under section 9004; or
``(B) State requirements regulating underground storage
tanks that are similar or identical to this subtitle, as
determined by the Administrator; and
``(2) by the Administrator, acting under this subtitle or a
State program approved under section 9004.

``SEC. 9011. BEDROCK BIOREMEDIATION.

``The Administrator shall establish, at an institution of
higher education (as defined in section 101 of the Higher
Education Act of 1965 (20 U.S.C. 1001)) with established
expertise in bioremediation of contaminated bedrock aquifers,
a resource center--
``(1) to conduct research concerning bioremediation of
methyl tertiary butyl ether in contaminated underground
aquifers, including contaminated bedrock; and
``(2) to provide for States a technical assistance
clearinghouse for information concerning innovative
technologies for bioremediation described in paragraph (1).

``SEC. 9012. SOIL REMEDIATION.

``The Administrator may establish a program to conduct
research concerning remediation of methyl tertiary butyl
ether contamination of soil, including granitic or volcanic
soil.

``SEC. 9013. AUTHORIZATION OF APPROPRIATIONS.

``In addition to amounts made available under section
2007(f), there are authorized to be appropriated from the
Leaking Underground Storage Tank Trust Fund, notwithstanding
section 9508(c)(1) of the Internal Revenue Code of 1986--
``(1) to carry out section 9003(h)(12), $200,000,000 for
fiscal year 2003, to remain available until expended;
``(2) to carry out section 9010--
``(A) $50,000,000 for fiscal year 2003; and
``(B) $30,000,000 for each of fiscal years 2004 through
2008;
``(3) to carry out section 9011--
``(A) $500,000 for fiscal year 2003; and
``(B) $300,000 for each of fiscal years 2004 through 2008;
and
``(4) to carry out section 9012--
``(A) $100,000 for fiscal year 2003; and
``(B) $50,000 for each of fiscal years 2004 through 2008.
(c) Technical Amendments.--(1) Section 1001 of the Solid
Waste Disposal Act (42 U.S.C. prec. 6901) is amended by
striking the item relating to section 9010 and inserting the
following:

``Sec. 9010. Release prevention and compliance.
``Sec. 9011. Bedrock bioremediation.
``Sec. 9012. Soil remediation.
``Sec. 9013. Authorization of appropriations.''.
(2) Section 9001(3)(A) of the Solid Waste Disposal Act (42
U.S.C. 6991(3)(A)) is amended by striking ``sustances'' and
inserting ``substances''.
(3) Section 9003(f)(1) of the Solid Waste Disposal Act (42
U.S.C. 6991b(f)(1)) is amended by striking ``subsection (c)
and (d) of this section'' and inserting ``subsections (c) and
(d)''.
(4) Section 9004(a) of the Solid Waste Disposal Act (42
U.S.C. 6991c(a)) is amended in the second sentence by
striking ``referred to'' and all that follows and inserting
``referred to in subparagraph (A) or (B), or both, of section
9001(2).''.
(5) Section 9005 of the Solid Waste Disposal Act (42 U.S.C.
6991d) is amended--
(A) in subsection (a), by striking ``study taking'' and
inserting ``study, taking'';
(B) in subsection (b)(1), by striking ``relevent'' and
inserting ``relevant''; and
(C) in subsection (b)(4), by striking ``Evironmental'' and
inserting ``Environmental''.

SEC. 833. AUTHORITY FOR WATER QUALITY PROTECTION FROM FUELS.

(a) Findings.--Congress finds that--
(1) since 1979, methyl tertiary butyl ether (referred to in
this section as ``MTBE'') has been used nationwide at low
levels in gasoline to replace lead as an octane booster or
anti-knocking agent;
(2) Public Law 101-549 (commonly known as the ``Clean Air
Act Amendments of 1990'') (42 U.S.C. 7401 et seq.)
established a fuel oxygenate standard under which
reformulated gasoline must contain at least 2 percent oxygen
by weight;
(3) at the time of the adoption of the fuel oxygen
standard, Congress was aware that significant use of MTBE
could result from the adoption of that standard, and that the
use of MTBE would likely be important to the cost-effective
implementation of that program;
(4) Congress is aware that gasoline and its component
additives have leaked from storage tanks, with consequences
for water quality;
(5) the fuel industry responded to the fuel oxygenate
standard established by Public Law 101-549 by making
substantial investments in--
(A) MTBE production capacity; and
(B) systems to deliver MTBE-containing gasoline to the
marketplace;
(6) when leaked or spilled into the environment, MTBE may
cause serious problems of drinking water quality;
(7) in recent years, MTBE has been detected in water
sources throughout the United States;
(8) MTBE can be detected by smell and taste at low
concentrations;
(9) while small quantities of MTBE can render water
supplies unpalatable, the precise human health effects of
MTBE consumption at low levels are yet unknown;
(10) in the report entitled ``Achieving Clean Air and Clean
Water: The Report of the Blue Ribbon Panel on Oxygenates in
Gasoline'' and dated September 1999, Congress was urged--
(A) to eliminate the fuel oxygenate standard;
(B) to greatly reduce use of MTBE; and
(C) to maintain the environmental performance of
reformulated gasoline;
(11) Congress has--
(A) reconsidered the relative value of MTBE in gasoline;
and
(B) decided to eliminate use of MTBE as a fuel additive;
(12) the timeline for elimination of use of MTBE as a fuel
additive must be established in a manner that achieves an
appropriate balance among the goals of--
(A) environmental protection;
(B) adequate energy supply; and
(C) reasonable fuel prices; and
(13) it is appropriate for Congress to provide some limited
transition assistance--
(A) to merchant producers of MTBE who produced MTBE in
response to a market created by

[[Page S10770]]

the oxygenate requirement contained in the Clean Air Act; and
(B) for the purpose of mitigating any fuel supply problems
that may result from elimination of a widely-used fuel
additive.
(b) Purposes.--The purposes of this section are--
(1) to eliminate use of MTBE as a fuel oxygenate; and
(2) to provide assistance to merchant producers of MTBE in
making the transition from producing MTBE to producing other
fuel additives.
(c) Authority for Water Quality Protection From Fuels.--
Section 211(c) of the Clean Air Act (42 U.S.C. 7545(c)) is
amended--
(1) in paragraph (1)(A)--
(A) by inserting ``fuel or fuel additive or'' after
``Administrator any''; and
(B) by striking ``air pollution which'' and inserting ``air
pollution, or water pollution, that'';
(2) in paragraph (4)(B), by inserting ``or water quality
protection,'' after ``emission control,''; and
(3) by adding at the end the following:
``(5) Prohibition on use of mtbe.--
``(A) In general.--Subject to subparagraph (E), not later
than 4 years after the date of enactment of this paragraph,
the use of methyl tertiary butyl ether in motor vehicle fuel
in any State other than a State described in subparagraph (C)
is prohibited.
``(B) Regulations.--The Administrator shall promulgate
regulations to effect the prohibition in subparagraph (A).
``(C) States that authorize use.--A State described in this
subparagraph is a State that submits to the Administrator a
notice that the State authorizes use of methyl tertiary butyl
ether in motor vehicle fuel sold or used in the State.
``(D) Publication of notice.--The Administrator shall
publish in the Federal Register each notice submitted by a
State under subparagraph (C).
``(E) Trace quantities.--In carrying out subparagraph (A),
the Administrator may allow trace quantities of methyl
tertiary butyl ether, not to exceed 0.5 percent by volume, to
be present in motor vehicle fuel in cases that the
Administrator determines to be appropriate.
``(6) MTBE merchant producer conversion assistance.--
``(A) In general.--
``(i) Grants.--The Secretary of Energy, in consultation
with the Administrator, may make grants to merchant producers
of methyl tertiary butyl ether in the United States to assist
the producers in the conversion of eligible production
facilities described in subparagraph (C) to the production of
iso-octane and alkylates.
``(ii) Determination.--The Administrator, in consultation
with the Secretary of Energy, may determine that transition
assistance for the production of iso-octane and alkylates is
inconsistent with the provisions of subparagraph (B) and, on
that basis, may deny applications for grants authorized by
this provision.
``(B) Further grants.--The Secretary of Energy, in
consultation with the Administrator, may also further make
grants to merchant producers of MTBE in the United States to
assist the producers in the conversion of eligible production
facilities described in subparagraph (C) to the production of
such other fuel additives that, consistent with 211(c)--
``(i) unless the Administrator determines that such fuel
additives may reasonably be anticipated to endanger public
health or the environment;
``(ii) have been registered and have been tested or are
being tested in accordance with the requirements of this
section; and
``(iii) will contribute to replacing gasoline volumes lost
as a result of paragraph (5).
``(C) Eligible production facilities.--A production
facility shall be eligible to receive a grant under this
paragraph if the production facility--
``(i) is located in the United States; and
``(ii) produced methyl tertiary butyl ether for consumption
in nonattainment areas during the period--

``(I) beginning on the date of enactment of this paragraph;
and
``(II) ending on the effective date of the prohibition on
the use of methyl tertiary butyl ether under paragraph (5).

``(D) Authorization of appropriations.--There is authorized
to be appropriated to carry out this paragraph $250,000,000
for each of fiscal years 2003 through 2005.''.
(d) No Effect on Law Concerning State Authority.--The
amendments made by subsection (c) have no effect on the law
in effect on the day before the date of enactment of this Act
regarding the authority of States to limit the use of methyl
tertiary butyl ether in motor vehicle fuel.

SEC. 834. ELIMINATION OF OXYGEN CONTENT REQUIREMENT FOR
REFORMULATED GASOLINE.

(a) Elimination.--
(1) In general.--Section 211(k) of the Clean Air Act (42
U.S.C. 7545(k)) is amended--
(A) in paragraph (2)--
(i) in the second sentence of subparagraph (A), by striking
``(including the oxygen content requirement contained in
subparagraph (B))'';
(ii) by striking subparagraph (B); and
(iii) by redesignating subparagraphs (C) and (D) as
subparagraphs (B) and (C), respectively;
(B) in paragraph (3)(A), by striking clause (v);
(C) in paragraph (7)--
(i) in subparagraph (A)--

(I) by striking clause (i); and
(II) by redesignating clauses (ii) and (iii) as clauses (i)
and (ii), respectively; and

(ii) in subparagraph (C)--

(I) by striking clause (ii); and
(II) by redesignating clause (iii) as clause (ii); and

(2) Effective date.--The amendments made by paragraph (1)
take effect 270 days after the date of enactment of this Act,
except that such amendments shall take effect upon enactment
in any State that has received a waiver under section 209(b)
of the Clean Air Act.
(b) Maintenance of Toxic Air Pollutant Emission
Reductions.--Section 211(k)(1) of the Clean Air Act (42
U.S.C. 7545(k)(1)) is amended--
(1) by striking ``Within 1 year after the enactment of the
Clean Air Act Amendments of 1990,'' and inserting the
following:
``(A) In general.--Not later than November 15, 1991,''; and
(2) by adding at the end the following:
``(B) Maintenance of toxic air pollutant emissions
reductions from reformulated gasoline.--
``(i) Definitions.--In this subparagraph the term `PADD'
means a Petroleum Administration for Defense District.
``(ii) Regulations regarding emissions of toxic air
pollutants.--Not later than 270 days after the date of
enactment of this subparagraph, the Administrator shall
establish, for each refinery or importer (other than a
refinery or importer in a State that has received a waiver
under section 209(b) with regard to gasoline produced for use
in that state), standards for toxic air pollutants from use
of the reformulated gasoline produced or distributed by the
refinery or importer that maintain the reduction of the
average annual aggregate emissions of toxic air pollutants
for reformulated gasoline produced or distributed by the
refinery or importer during calendar years 1999 and 2000,
determined on the basis of data collected by the
Administrator with respect to the refinery or importer.
(iii) Standards applicable to specific refineries or
importers.--

``(I) Applicability of standards.--For any calendar year,
the standards applicable to a refinery or importer under
clause (ii) shall apply to the quantity of gasoline produced
or distributed by the refinery or importer in the calendar
year only to the extent that the quantity is less than or
equal to the average annual quantity of reformulated gasoline
produced or distributed by the refinery or importer during
calendar years 1999 and 2000.
``(II) Applicability of other standards.--For any calendar
year, the quantity of gasoline produced or distributed by a
refinery or importer that is in excess of the quantity
subject to subclause (I) shall be subject to standards for
toxic air pollutants promulgated under subparagraph (A) and
paragraph (3)(B).

``(iv) Credit program.--The Administrator shall provide for
the granting and use of credits for emissions of toxic air
pollutants in the same manner as provided in paragraph (7).
``(v) Regional protection of toxics reduction baselines.--

``(I) In general.--Not later than 60 days after the date of
enactment of this subparagraph, and not later than April 1 of
each calendar year that begins after that date of enactment,
the Administrator shall publish in the Federal Register a
report that specifies, with respect to the previous calendar
year--

``(aa) the quantity of reformulated gasoline produced that
is in excess of the average annual quantity of reformulated
gasoline produced in 1999 and 2000; and
``(bb) the reduction of the average annual aggregate
emissions of toxic air pollutants in each PADD, based on
retail survey data or data from other appropriate sources.

``(II) Effect of failure to maintain aggregate toxics
reductions.--If, in any calendar year, the reduction of the
average annual aggregate emissions of toxic air pollutants in
a PADD fails to meet or exceed the reduction of the average
annual aggregate emissions of toxic air pollutants in the
PADD in calendar years 1999 and 2000, the Administrator, not
later than 90 days after the date of publication of the
report for the calendar year under subclause (I), shall--

``(aa) identify, to the maximum extent practicable, the
reasons for the failure, including the sources, volumes, and
characteristics of reformulated gasoline that contributed to
the failure; and
``(bb) promulgate revisions to the regulations promulgated
under clause (ii), to take effect not earlier than 180 days
but not later than 270 days after the date of promulgation,
to provide that, notwithstanding clause (iii)(II), all
reformulated gasoline produced or distributed at each
refinery or importer shall meet the standards applicable
under clause (iii) not later than April 1 of the year
following the report in subclause (II) and for subsequent
years.
``(vi) Regulations to control hazardous air pollutants from
motor vehicles and motor vehicle fuels.--Not later than July
1, 2004, the Administrator shall promulgate final regulations
to control hazardous air pollutants from motor vehicles and
motor vehicle fuels, as provided for in section 80.1045 of
title 40, Code of Federal Regulations (as in effect on the
date of enactment of this subparagraph).''.
(c) Consolidation in Reformulated Gasoline Regulations.--
Not later than 180 days after the date of enactment of this
Act, the Administrator shall revise the reformulated gasoline
regulations under subpart D of part 80 of title 40, Code of
Federal Regulations, to consolidate the regulations
applicable to VOC-Control Regions 1 and 2 under section 80.41
of that title by eliminating the less stringent requirements
applicable to gasoline designated for VOC-Control Region 2
and instead applying the more stringent requirements
applicable to gasoline designated for VOC-Control Region 1.
(d) Savings Clause.--Nothing in this section is intended to
affect or prejudice any legal claims or actions with respect
to regulations promulgated by the Administrator prior to
enactment of this Act regarding emissions of toxic air
pollutants from motor vehicles.

[[Page S10771]]

(e) Determination Regarding a State Petition.--Section
211(k) of the Clean Air Act (42 U.S.C. 7545(k)) is amended by
inserting after paragraph (10) the following:
``(11) Determination regarding a state petition.--
``(A) In general.--Notwithstanding any other provision of
this section, not less than 30 days after enactment of this
paragraph the Administrator must determine the adequacy of
any petition received from a Governor of a State to exempt
gasoline sold in that State from the requirements of
paragraph (2)(B).
``(B) Approval.--If the determination in (A) is not made
within thirty days of enactment of this paragraph, the
petition shall be deemed approved.''.

SEC. 835. PUBLIC HEALTH AND ENVIRONMENTAL IMPACTS OF FUELS
AND FUEL ADDITIVES.

Section 211(b) of the Clean Air Act (42 U.S.C. 7545(b)) is
amended--
(1) in paragraph (2)--
(A) by striking ``may also'' and inserting ``shall, on a
regular basis,''; and
(B) by striking subparagraph (A) and inserting the
following:
``(A) to conduct tests to determine potential public health
and environmental effects of the fuel or additive (including
carcinogenic, teratogenic, or mutagenic effects); and''; and
(2) by adding at the end the following:
``(4) Study on certain fuel additives and blendstocks.--
``(A) In general.--Not later than 2 years after the date of
enactment of this paragraph, the Administrator shall--
``(i) conduct a study on the effects on public health, air
quality, and water resources of increased use of, and the
feasibility of using as substitutes for methyl tertiary butyl
ether in gasoline--

``(I) ethyl tertiary butyl ether;
``(II) tertiary amyl methyl ether;
``(III) di-isopropyl ether;
``(IV) tertiary butyl alcohol;
``(V) other ethers and heavy alcohols, as determined by
then Administrator;
``(VI) ethanol;
``(VII) iso-octane; and
``(VIII) alkylates; and

``(ii) conduct a study on the effects on public health, air
quality, and water resources of the adjustment for ethanol-
blended reformulated gasoline to the VOC performance
requirements otherwise applicable under sections 211(k)(1)
and 211(k)(3) of the Clean Air Act.
``(iii) submit to the Committee on Environment and Public
Works of the Senate and the Committee on Energy and Commerce
of the House of Representatives a report describing the
results of these studies.
``(B) Contracts for study.--In carrying out this paragraph,
the Administrator may enter into one or more contracts with
nongovernmental entities including but not limited to
National Energy Laboratories and institutions of higher
education (as defined in section 101 of the Higher Education
Act of 1965 (20 U.S.C. 1001)).''.

SEC. 836. ANALYSES OF MOTOR VEHICLE FUEL CHANGES.

Section 211 of the Clean Air Act (42 U.S.C. 7545) (as
amended by section 820(a)) is amended by inserting after
subsection (o) the following:
``(p) Analyses of Motor Vehicle Fuel Changes and Emissions
Model.--
``(1) Anti-backsliding analysis.--
``(A) Draft analysis.--Not later than 4 years after the
date of enactment of this paragraph, the Administrator shall
publish for public comment a draft analysis of the changes in
emissions of air pollutants and air quality due to the use of
motor vehicle fuel and fuel additives resulting from
implementation of the amendments made by the Federal
Reformulated Fuels Act of 2003.
``(B) Final analysis.--After providing a reasonable
opportunity for comment but not later than 5 years after the
date of enactment of this paragraph, the Administrator shall
publish the analysis in final form.
``(2) Emissions model.--For the purposes of this
subsection, as soon as the necessary data are available, the
Administrator shall develop and finalize an emissions model
that reasonably reflects the effects of gasoline
characteristics or components on emissions from vehicles in
the motor vehicle fleet during calendar year 2005.''.

SEC. 837. ADDITIONAL OPT-IN AREAS UNDER REFORMULATED GASOLINE
PROGRAM.

Section 211(k)(6) of the Clean Air Act (42 U.S.C.
7545(k)(6)) is amended--
(1) by striking ``(6) Opt-in areas.--(A) Upon'' and
inserting the following:
``(6) Opt-in areas.--
``(A) Classified areas.--
``(i) In general.--Upon'';
(2) in subparagraph (B), by striking ``(B) If'' and
inserting the following:
``(ii) Effect of insufficient domestic capacity to produce
reformulated gasoline.--If'';
(3) in subparagraph (A)(ii) (as redesignated by paragraph
(2))--
(A) in the first sentence, by striking ``subparagraph (A)''
and inserting ``clause (i)''; and
(B) in the second sentence, by striking ``this paragraph''
and inserting ``this subparagraph''; and
(4) by adding at the end the following:
``(B) Ozone transport region.--
``(i) Application of prohibition.--

``(I) In general.--In addition to the provisions of
subparagraph (A), upon the application of the Governor of a
State in the ozone transport region established by section
184(a), the Administrator, not later than 180 days after the
date of receipt of the application, shall apply the
prohibition specified in paragraph (5) to any area in the
State (other than an area classified as a marginal, moderate,
serious, or severe ozone nonattainment area under subpart 2
of part D of title I) unless the Administrator determines
under clause (iii) that there is insufficient capacity to
supply reformulated gasoline.
``(II) Publication of application.--As soon as practicable
after the date of receipt of an application under subclause
(I), the Administrator shall publish the application in the
Federal Register.

``(ii) Period of applicability.--Under clause (i), the
prohibition specified in paragraph (5) shall apply in a
State--

``(I) commencing as soon as practicable but not later than
2 years after the date of approval by the Administrator of
the application of the Governor of the State; and
``(II) ending not earlier than 4 years after the
commencement date determined under subclause (I).

``(iii) Extension of commencement date based on
insufficient capacity.--

``(I) In general.--If, after receipt of an application from
a Governor of a State under clause (i), the Administrator
determines, on the Administrator's own motion or on petition
of any person, after consultation with the Secretary of
Energy, that there is insufficient capacity to supply
reformulated gasoline, the Administrator, by regulation--

``(aa) shall extend the commencement date with respect to
the State under clause (ii)(I) for not more than 1 year; and
``(bb) may renew the extension under item (aa) for two
additional periods, each of which shall not exceed 1 year.

``(II) Deadline for action on petitions.--The Administrator
shall act on any petition submitted under subclause (I) not
later than 180 days after the date of receipt of the
petition.''.

SEC. 838. FEDERAL ENFORCEMENT OF STATE FUELS REQUIREMENTS.

Section 211(c)(4)(C) of the Clean Air Act (42 U.S.C.
7545(c)(4)(C)) is amended--
(1) by striking ``(C) A State'' and inserting the
following:
``(C) Authority of state to control fuels and fuel
additives for reasons of necessity.--
``(i) In general.--A State''; and
(2) by adding at the end the following:
``(ii) Enforcement by the administrator.--In any case in
which a State prescribes and enforces a control or
prohibition under clause (i), the Administrator, at the
request of the State, shall enforce the control or
prohibition as if the control or prohibition had been adopted
under the other provisions of this section.''.

SEC. 839. FUEL SYSTEM REQUIREMENTS HARMONIZATION STUDY.

(a) Study.--
(1) In general.--The Administrator of the Environmental
Protection Agency and the Secretary of Energy shall jointly
conduct a study of Federal, State, and local requirements
concerning motor vehicle fuels, including--
(A) requirements relating to reformulated gasoline,
volatility (measured in Reid vapor pressure), oxygenated
fuel, and diesel fuel; and
(B) other requirements that vary from State to State,
region to region, or locality to locality.
(2) Required elements.--The study shall assess--
(A) the effect of the variety of requirements described in
paragraph (1) on the supply, quality, and price of motor
vehicle fuels available to the consumer;
(B) the effect of the requirements described in paragraph
(1) on achievement of--
(i) national, regional, and local air quality standards and
goals; and
(ii) related environmental and public health protection
standards and goals;
(C) the effect of Federal, State, and local motor vehicle
fuel regulations, including multiple motor vehicle fuel
requirements, on--
(i) domestic refineries;
(ii) the fuel distribution system; and
(iii) industry investment in new capacity;
(D) the effect of the requirements described in paragraph
(1) on emissions from vehicles, refineries, and fuel handling
facilities;
(E) the feasibility of developing national or regional
motor vehicle fuel slates for the 48 contiguous States that,
while protecting and improving air quality at the national,
regional, and local levels, could--
(i) enhance flexibility in the fuel distribution
infrastructure and improve fuel fungibility;
(ii) reduce price volatility and costs to consumers and
producers;
(iii) provide increased liquidity to the gasoline market;
and
(iv) enhance fuel quality, consistency, and supply; and
(F) the feasibility of providing incentives, and the need
for the development of national standards necessary, to
promote cleaner burning motor vehicle fuel.
(b) Report.--
(1) In general.--Not later than June 1, 2006, the
Administrator of the Environmental Protection Agency and the
Secretary of Energy shall submit to Congress a report on the
results of the study conducted under subsection (a).
(2) Recommendations.--
(A) In general.--The report shall contain recommendations
for legislative and administrative actions that may be
taken--
(i) to improve air quality;
(ii) to reduce costs to consumers and producers; and
(iii) to increase supply liquidity.
(B) Required considerations.--The recommendations under
subparagraph (A) shall take into account the need to provide
advance notice of required modifications to refinery and fuel
distribution systems in order to ensure an adequate supply of
motor vehicle fuel in all States.
(3) Consultation.--In developing the report, the
Administrator of the Environmental Protection Agency and the
Secretary of Energy shall consult with--

[[Page S10772]]

(A) the Governors of the States;
(B) automobile manufacturers;
(C) motor vehicle fuel producers and distributors; and
(D) the public.

SEC. 840. REVIEW OF FEDERAL PROCUREMENT INITIATIVES RELATING
TO USE OF RECYCLED PRODUCTS AND FLEET AND
TRANSPORTATION EFFICIENCY.

Not later than 180 days after the date of enactment of this
Act, the Administrator of General Services shall submit to
Congress a report that details efforts by each Federal agency
to implement the procurement policies specified in Executive
Order No. 13101 (63 Fed. Reg. 49643; relating to governmental
use of recycled products) and Executive Order No. 13149 (65
Fed. Reg. 24607; relating to Federal fleet and transportation
efficiency).

TITLE IX--ENERGY EFFICIENCY AND ASSISTANCE TO LOW INCOME CONSUMERS

Subtitle A--Low Income Assistance and State Energy Programs

SEC. 901. INCREASED FUNDING FOR LIHEAP, WEATHERIZATION
ASSISTANCE, AND STATE ENERGY GRANTS.

(a) LIHEAP.--(1) Section 2602(b) of the Low-Income Home
Energy Assistance Act of 1981 (42 U.S.C. 8621(b)) is amended
by striking the first sentence and inserting the following:
``There are authorized to be appropriated to carry out the
provisions of this title (other than section 2607A),
$3,400,000,000 for each of fiscal years 2003 through 2005.''.
(2) Section 2602(e) of the Low-Income Home Energy
Assistance Act of 1981 (42 U.S.C. 8621(e)) is amended by
striking ``$600,000,000'' and inserting ``$1,000,000,000''.
(3) Section 2609A(a) of the Low-Income Energy Assistance
Act of 1981 (42 U.S.C. 8628a(a)) is amended by striking ``not
more than $300,000'' and inserting: ``not more than
$750,000''.
(b) Weatherization Assistance.--Section 422 of the Energy
Conservation and Production Act (42 U.S.C. 6872) is amended
by striking ``for fiscal years 1999 through 2003 such sums as
may be necessary.'' and inserting: ``$325,000,000 for fiscal
year 2003, $400,000,000 for fiscal year 2004, and
$500,000,000 for fiscal year 2005.''.

SEC. 902. STATE ENERGY PROGRAMS.

(a) State Energy Conservation Plans.--Section 362 of the
Energy Policy and Conservation Act (42 U.S.C. 6322)) is
amended by adding at the end the following:
``(g) The Secretary shall, at least once every 3 years,
invite the Governor of each State to review and, if
necessary, revise the energy conservation plan of the State
submitted under subsection (b) or (e). Such reviews should
consider the energy conservation plans of other States within
the region, and identify opportunities and actions that may
be carried out in pursuit of common energy conservation
goals.''.
(b) State Energy Conservation Goals.--Section 364 of the
Energy Policy and Conservation Act (42 U.S.C. 6324) is
amended to read as follows:
``Sec. 364. Each State energy conservation plan with
respect to which assistance is made available under this part
on or after the date of enactment of the Energy Policy Act of
2003 shall contain a goal, consisting of an improvement of 25
percent or more in the efficiency of use of energy in the
State concerned in calendar year 2010 as compared to calendar
year 1990, and may contain interim goals.''.
(c) State Energy Conservation Grants.--Section 365(f) of
the Energy Policy and Conservation Act (42 U.S.C. 6325(f)) is
amended by striking ``for fiscal years 1999 through 2003 such
sums as may be necessary.'' and inserting: ``$100,000,000 for
each of fiscal years 2003 and 2004; $125,000,000 for fiscal
year 2005; and such sums as may be necessary for each fiscal
year thereafter.''.

SEC. 903. ENERGY EFFICIENT SCHOOLS.

(a) Establishment.--There is established in the Department
of Energy the High Performance Schools Program (in this
section referred to as the ``Program'').
(b) Grants.--The Secretary of Energy may make grants to a
State energy office--
(1) to assist school districts in the State to improve the
energy efficiency of school buildings;
(2) to administer the Program; and
(3) to promote participation in the Program.
(c) Grants To Assist School Districts.--The Secretary shall
condition grants under subsection (b)(1) on the State energy
office using the grants to assist school districts that have
demonstrated--
(1) a need for the grants to build additional school
buildings to meet increasing elementary or secondary
enrollments or to renovate existing school buildings; and
(2) a commitment to use the grant funds to develop high
performance school buildings in accordance with a plan that
the State energy office, in consultation with the State
educational agency, has determined is feasible and
appropriate to achieve the purposes for which the grant is
made.
(d) Grants for Administration.--Grants under subsection
(b)(2) shall be used to--
(1) evaluate compliance by school districts with
requirements of this section;
(2) distribute information and materials to clearly define
and promote the development of high performance school
buildings for both new and existing facilities;
(3) organize and conduct programs for school board members,
school personnel, architects, engineers, and others to
advance the concepts of high performance school buildings;
(4) obtain technical services and assistance in planning
and designing high performance school buildings; or
(5) collect and monitor data and information pertaining to
the high performance school building projects.
(e) Grants To Promote Participation.--Grants under
subsection (b)(3) shall be used for promotional and marketing
activities, including facilitating private and public
financing, promoting the use of energy savings performance
contracts, working with school administrations, students, and
communities, and coordinating public benefit programs.
(f) Supplementing Grant Funds.--The State energy office
shall encourage qualifying school districts to supplement
funds awarded pursuant to this section with funds from other
sources in the implementation of their plans.
(g) Allocations.--Except as provided in subsection (h),
funds appropriated to carry out this section shall be
allocated as follows:
(1) 70 percent shall be used to make grants under
subsection (b)(1).
(2) 15 percent shall be used to make grants under
subsection (b)(2).
(3) 15 percent shall be used to make grants under
subsection (b)(3).
(h) Other Funds.--The Secretary of Energy may retain an
amount, not to exceed $300,000 per year, to assist State
energy offices in coordinating and implementing the Program.
Such funds may be used to develop reference materials to
further define the principles and criteria to achieve high
performance school buildings.
(i) Authorization of Appropriations.--For grants under
subsection (b) there are authorized to be appropriated--
(1) $200,000,000 for fiscal year 2003;
(2) $210,000,000 for fiscal year 2004;
(3) $220,000,000 for fiscal year 2005;
(4) $230,000,000 for fiscal year 2006; and
(5) such sums as may be necessary for fiscal year 2007 and
each fiscal year thereafter through fiscal year 2012.
(j) Definitions.--For purposes of this section:
(1) High performance school building.--The term ``high
performance school building'' means a school building that,
in its design, construction, operation, and maintenance--
(A) maximizes use of renewable energy and energy-efficient
technologies and systems;
(B) is cost-effective on a life-cycle basis;
(C) achieves either--
(i) the applicable Energy Star building energy performance
ratings; or
(ii) energy consumption levels at least 30 percent below
those of the most recent version of ASHRAE Standard 90.1;
(D) uses affordable, environmentally preferable, and
durable materials;
(E) enhances indoor environmental quality;
(F) protects and conserves water; and
(G) optimizes site potential.
(2) Renewable energy.--The term ``renewable energy'' means
energy produced by solar, wind, biomass, ocean, geothermal,
or hydroelectric power.
(3) School.--The term ``school'' means--
(A) an ``elementary school'' as that term is defined in
section 14101(14) of the Elementary and Secondary Education
Act of 1965 (20 U.S.C. 8801(14)),
(B) a ``secondary school'' as that term is defined in
section 14101(25) of the Elementary and Secondary Education
Act of 1965 (20 U.S.C. 8801(25)), or
(C) an elementary or secondary Indian school funded by the
Bureau of Indian Affairs.
(4) State educational agency.--The term ``State educational
agency'' has the same meaning given such term in section
14101(28) of the Elementary and Secondary Education Act of
1965 (20 U.S.C. 8801(28)).
(5) State energy office.--The term ``State energy office''
means the State agency responsible for developing State
energy conservation plans under section 362 of the Energy
Policy and Conservation Act (42 U.S.C. 6322), or, if no such
agency exists, a State agency designated by the Governor of
the State.

SEC. 904. LOW INCOME COMMUNITY ENERGY EFFICIENCY PILOT
PROGRAM.

(a) Grants.--The Secretary of Energy is authorized to make
grants to units of local government, private, non-profit
community development organizations, and Indian tribe
economic development entities to improve energy efficiency,
identify and develop alternative renewable and distributed
energy supplies, and increase energy conservation in low
income rural and urban communities.
(b) Purpose of Grants.--The Secretary may make grants on a
competitive basis for--
(1) investments that develop alternative renewable and
distributed energy supplies;
(2) energy efficiency projects and energy conservation
programs;
(3) studies and other activities that improve energy
efficiency in low income rural and urban communities;
(4) planning and development assistance for increasing the
energy efficiency of buildings and facilities; and
(5) technical and financial assistance to local government
and private entities on developing new renewable and
distributed sources of power or combined heat and power
generation.
(c) Definition.--For purposes of this section, the term
``Indian tribe'' means any Indian tribe, band, nation, or
other organized group or community, including any Alaskan
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.
(d) Authorization of Appropriations.--For the purposes of
this section there are authorized to be appropriated to the
Secretary of Energy an amount not to exceed $20,000,000 for
fiscal year 2003 and each fiscal year thereafter through
fiscal year 2005.

SEC. 905. ENERGY EFFICIENT APPLIANCE REBATE PROGRAMS.

(a) Definitions.--In this section:
(1) Eligible state.--The term ``eligible State'' means a
State that meets the requirements of subsection (b).

[[Page S10773]]

(2) Energy star program.--The term ``Energy Star program''
means the program established by section 324A of the Energy
Policy and Conservation Act.
(3) Residential energy star product.--The term
``residential Energy Star product'' means a product for a
residence that is rated for energy efficiency under the
Energy Star program.
(4) State energy office.--The term ``State energy office''
means the State agency responsible for developing State
energy conservation plans under section 362 of the Energy
Policy and Conservation Act (42 U.S.C. 6322).
(5) State program.--The term ``State program'' means a
State energy efficient appliance rebate program described in
subsection (b)(1).
(b) Eligible States.--A State shall be eligible to receive
an allocation under subsection (c) if the State--
(1) establishes (or has established) a State energy
efficient appliance rebate program to provide rebates to
residential consumers for the purchase of residential Energy
Star products to replace used appliances of the same type;
(2) submits an application for the allocation at such time,
in such form, and containing such information as the
Secretary may require; and
(3) provides assurances satisfactory to the Secretary that
the State will use the allocation to supplement, but not
supplant, funds made available to carry out the State
program.
(c) Amount of Allocations.--
(1) In general.--Subject to paragraph (2), for each fiscal
year, the Secretary shall allocate to the State energy office
of each eligible State to carry out subsection (d) an amount
equal to the product obtained by multiplying the amount made
available under subsection (e) for the fiscal year by the
ratio that the population of the State in the most recent
calendar year for which data are available bears to the total
population of all eligible States in that calendar year.
(2) Minimum allocations.--For each fiscal year, the amounts
allocated under this subsection shall be adjusted
proportionately so that no eligible State is allocated a sum
that is less than an amount determined by the Secretary.
(d) Use of Allocated Funds.--The allocation to a State
energy office under subsection (c) may be used to pay up to
50 percent of the cost of establishing and carrying out a
State program.
(e) Issuance of Rebates.--Rebates may be provided to
residential consumers that meet the requirements of the State
program. The amount of a rebate shall be determined by the
State energy office, taking into consideration--
(1) the amount of the allocation to the State energy office
under subsection (c);
(2) the amount of any Federal or State tax incentive
available for the purchase of the residential Energy Star
product; and
(3) the difference between the cost of the residential
Energy Star product and the cost of an appliance that is not
a residential Energy Star product, but is of the same type
as, and is the nearest capacity, performance, and other
relevant characteristics (as determined by the State energy
office) to the residential Energy Star product.
(f) Authorization of Appropriations.--There are authorized
to be appropriated to carry out this section such sums as are
necessary for fiscal year 2003 through fiscal year 2012.

Subtitle B--Federal Energy Efficiency

SEC. 911. ENERGY MANAGEMENT REQUIREMENTS.

(a) Energy Reduction Goals.--Section 543(a)(1) of the
National Energy Conservation Policy Act (42 U.S.C.
8253(a)(1)) is amended to read as follows:
``(1) Subject to paragraph (2), each agency shall apply
energy conservation measures to, and shall improve the design
for the construction of, the Federal buildings of the agency
(including each industrial or laboratory facility) so that
the energy consumption per gross square foot of the Federal
buildings of the agency in fiscal years 2002 through 2011 is
reduced, as compared with the energy consumption per gross
square foot of the Federal buildings of the agency in fiscal
year 2000, by the percentage specified in the following
table:

``Fiscal Year                                    Percentage reduction
2002............................................................ 2
2003............................................................ 4
2004............................................................ 6
2005............................................................ 8
2006............................................................10
2007............................................................12
2008............................................................14
2009............................................................16
2010............................................................18
2011.........................................................20.''.
(b) Review and Revision of Energy Performance
Requirement.--Section 543(a) of the National Energy
Conservation Policy Act (42 U.S.C. 8253(a)) is further
amended by adding at the end the following:
``(3) Not later than December 31, 2010, the Secretary shall
review the results of the implementation of the energy
performance requirement established under paragraph (1) and
submit to Congress recommendations concerning energy
performance requirements for calendar years 2012 through
2021.''.
(c) Exclusions.--Section 543(c)(1) of the National Energy
Conservation Policy Act (42 U.S.C. 8253(c)(1)) is amended to
read as follows:
``(1)(A) An agency may exclude, from the energy performance
requirement for a calendar year established under subsection
(a) and the energy management requirement established under
subsection (b), any Federal building or collection of Federal
buildings, if the head of the agency finds that--
``(i) compliance with those requirements would be
impracticable;
``(ii) the agency has completed and submitted all federally
required energy management reports;
``(iii) the agency has achieved compliance with the energy
efficiency requirements of this Act, the Energy Policy Act of
1992, Executives Orders, and other Federal law; and
``(iv) the agency has implemented all practicable, life-
cycle cost-effective projects with respect to the Federal
building or collection of Federal buildings to be excluded.
``(B) A finding of impracticability under subparagraph
(A)(i) shall be based on--
``(i) the energy intensiveness of activities carried out in
the Federal building or collection of Federal buildings; or
``(ii) the fact that the Federal building or collection of
Federal buildings is used in the performance of a national
security function.''.
(d) Review by Secretary.--Section 543(c)(2) of the National
Energy Conservation Policy Act (42 U.S.C. 8253(c)(2)) is
amended--
(1) by striking ``impracticability standards'' and
inserting ``standards for exclusion''; and
(2) by striking ``a finding of impracticability'' and
inserting ``the exclusion''.
(e) Criteria.--Section 543(c) of the National Energy
Conservation Policy Act (42 U.S.C. 8253(c)) is further
amended by adding at the end the following:
``(3) Not later than 180 days after the date of enactment
of this paragraph, the Secretary shall issue guidelines that
establish criteria for exclusions under paragraph (1).''.
(f) Reports.--Section 548(b) of the National Energy
Conservation Policy Act (42 U.S.C. 8258(b)) is amended--
(1) in the subsection heading, by inserting ``The President
and'' before ``Congress''; and
(2) by inserting ``President and'' before ``Congress''.
(g) Conforming Amendment.--Section 550(d) of the National
Energy Conservation Policy Act (42 U.S.C. 8258b(d)) is
amended in the second sentence by striking ``the 20 percent
reduction goal established under section 543(a) of the
National Energy Conservation Policy Act (42 U.S.C.
8253(a)).'' and inserting ``each of the energy reduction
goals established under section 543(a).''.

SEC. 912. ENERGY USE MEASUREMENT AND ACCOUNTABILITY.

Section 543 of the National Energy Conservation Policy Act
(42 U.S.C. 8253) is further amended by adding at the end the
following:
``(e) Metering of Energy Use.--
``(1) Deadline.--By October 1, 2004, all Federal buildings
shall, for the purposes of efficient use of energy and
reduction in the cost of electricity used in such buildings,
be metered or submetered in accordance with guidelines
established by the Secretary under paragraph (2). Each agency
shall use, to the maximum extent practicable, advanced meters
or advanced metering devices that provide data at least daily
and that measure at least hourly consumption of electricity
in the Federal buildings of the agency. Such data shall be
incorporated into existing Federal energy tracking systems
and made available to Federal facility energy managers.
``(2) Guidelines.--
``(A) In general.--Not later than 180 days after the date
of enactment of this subsection, the Secretary, in
consultation with the Department of Defense, the General
Services Administration and representatives from the metering
industry, utility industry, energy services industry, energy
efficiency industry, national laboratories, universities and
Federal facility energy managers, shall establish guidelines
for agencies to carry out paragraph (1).
``(B) Requirements for guidelines.--The guidelines shall--
``(i) take into consideration--

``(I) the cost of metering and submetering and the reduced
cost of operation and maintenance expected to result from
metering and submetering;
``(II) the extent to which metering and submetering are
expected to result in increased potential for energy
management, increased potential for energy savings and energy
efficiency improvement, and cost and energy savings due to
utility contract aggregation; and
``(III) the measurement and verification protocols of the
Department of Energy;

``(ii) include recommendations concerning the amount of
funds and the number of trained personnel necessary to gather
and use the metering information to track and reduce energy
use;
``(iii) establish one or more dates, not later than 1 year
after the date of issuance of the guidelines, on which the
requirements specified in paragraph (1) shall take effect;
and
``(iv) establish exclusions from the requirements specified
in paragraph (1) based on the de minimus quantity of energy
use of a Federal building, industrial process, or structure.
``(3) Plan.--No later than 6 months after the date
guidelines are established under paragraph (2), in a report
submitted by the agency under section 548(a), each agency
shall submit to the Secretary a plan describing how the
agency will implement the requirements of paragraph (1),
including (A) how the agency will designate personnel
primarily responsible for achieving the requirements and (B)
demonstration by the agency, complete with documentation, of
any finding that advanced meters or advanced metering
devices, as defined in paragraph (1), are not practicable.''.

SEC. 913. FEDERAL BUILDING PERFORMANCE STANDARDS.

(a) Revised Standards.--Section 305(a) of the Energy
Conservation and Production Act (42 U.S.C. 6834(a)) is
amended--
(1) in paragraph (2)(A), by striking ``CABO Model Energy
Code, 1992'' and inserting ``the 2000 International Energy
Conservation Code''; and
(2) by adding at the end the following:
``(3) Revised federal building energy efficiency
performance standards.--
``(A) In general.--Not later than 1 year after the date of
enactment of this paragraph, the

[[Page S10774]]

Secretary of Energy shall establish, by rule, revised Federal
building energy efficiency performance standards that require
that, if cost-effective--
``(i) new commercial buildings and multifamily high rise
residential buildings be constructed so as to achieve the
applicable Energy Star building energy performance ratings or
energy consumption levels at least 30 percent below those of
the most recent ASHRAE Standard 90.1, whichever results in
the greater increase in energy efficiency;
``(ii) new residential buildings (other than those
described in clause (i)) be constructed so as to achieve the
applicable Energy Star building energy performance ratings or
achieve energy consumption levels at least 30 percent below
the requirements of the most recent version of the
International Energy Conservation Code, whichever results in
the greater increase in energy efficiency; and
``(iii) sustainable design principles are applied to the
siting, design, and construction of all new and replacement
buildings.
``(B) Additional revisions.--Not later than 1 year after
the date of approval of amendments to ASHRAE Standard 90.1 or
the 2000 International Energy Conservation Code, the
Secretary of Energy shall determine, based on the cost-
effectiveness of the requirements under the amendments,
whether the revised standards established under this
paragraph should be updated to reflect the amendments.
``(C) Statement on compliance of new buildings.--In the
budget request of the Federal agency for each fiscal year and
each report submitted by the Federal agency under section
548(a) of the National Energy Conservation Policy Act (42
U.S.C. 8258(a)), the head of each Federal agency shall
include--
``(i) a list of all new Federal buildings of the Federal
agency; and
``(ii) a statement concerning whether the Federal buildings
meet or exceed the revised standards established under this
paragraph, including a monitoring and commissioning report
that is in compliance with the measurement and verification
protocols of the Department of Energy.
``(D) Authorization of appropriations.--There are
authorized to be appropriated such sums as are necessary to
carry out this paragraph and to implement the revised
standards established under this paragraph.''.
(b) Energy Labeling Program.--Section 305(a) of the Energy
Conservation and Production Act (42 U.S.C. 6834(a)) is
further amended by adding at the end the following:
``(e) Energy Labeling Program.--The Secretary of Energy, in
cooperation with the Administrator of the Environmental
Protection Agency, shall develop an energy labeling program
for new Federal buildings that exceed the revised standards
established under subsection (a)(3) by 15 percent or more.''.

SEC. 914. PROCUREMENT OF ENERGY EFFICIENT PRODUCTS.

(a) Requirements.--Part 3 of title V of the National Energy
Conservation Policy Act is amended by adding at the end the
following:

``SEC. 552. FEDERAL PROCUREMENT OF ENERGY EFFICIENT PRODUCTS.

``(a) Definitions.--In this section:
``(1) Energy star product.--The term `Energy Star product'
means a product that is rated for energy efficiency under an
Energy Star program.
``(2) Energy star program.--The term `Energy Star program'
means the program established by section 324A of the Energy
Policy and Conservation Act.
``(3) Executive agency.--The term `executive agency' has
the meaning given the term in section 4 of the Office of
Federal Procurement Policy Act (41 U.S.C. 403).
``(4) FEMP designated product.--The term `FEMP designated
product' means a product that is designated under the Federal
Energy Management Program of the Department of Energy as
being among the highest 25 percent of equivalent products for
energy efficiency.
``(b) Procurement of Energy Efficient Products.--
``(1) Requirement.--To meet the requirements of an
executive agency for an energy consuming product, the head of
the executive agency shall, except as provided in paragraph
(2), procure--
``(A) an Energy Star product; or
``(B) a FEMP designated product.
``(2) Exceptions.--The head of an executive agency is not
required to procure an Energy Star product or FEMP designated
product under paragraph (1) if--
``(A) an Energy Star product or FEMP designated product is
not cost effective over the life cycle of the product; or
``(B) no Energy Star product or FEMP designated product is
reasonably available that meets the requirements of the
executive agency.
``(3) Procurement planning.--The head of an executive
agency shall incorporate into the specifications for all
procurements involving energy consuming products and systems,
and into the factors for the evaluation of offers received
for the procurement, criteria for energy efficiency that are
consistent with the criteria used for rating Energy Star
products and for rating FEMP designated products.
``(c) Listing of Energy Efficient Products in Federal
Catalogs.--Energy Star and FEMP designated products shall be
clearly identified and prominently displayed in any inventory
or listing of products by the General Services Administration
or the Defense Logistics Agency.
(b) Conforming Amendment.--The table of contents in section
1(b) of the National Energy Conservation Policy Act (42
U.S.C. 8201 note) is amended by inserting after the item
relating to section 551 the following:

``Sec. 552. Federal Government procurement of energy efficient
products.''
(c) Regulations.--Not later than 180 days after the
effective date specified in subsection (f), the Secretary of
Energy shall issue guidelines to carry out section 552 of the
National Energy Conservation Policy Act (as added by
subsection (a)).
(d) Designation of Energy Star Products.--The Administrator
of the Environmental Protection Agency and the Secretary of
Energy shall expedite the process of designating products as
Energy Star products (as defined in section 552 of the
National Energy Conservation Policy Act (as added by
subsection (a)).
(e) Designation of Electric Motors.--In the case of
electric motors of 1 to 500 horsepower, agencies shall select
only premium efficient motors that meet a standard designated
by the Secretary. The Secretary shall designate such a
standard within 120 days of the enactment of this paragraph,
after considering the recommendations of associated electric
motor manufacturers and energy efficiency groups.
(f) Effective Date.--Subsection (a) and the amendment made
by that subsection take effect on the date that is 180 days
after the date of enactment of this Act.

SEC. 915. REPEAL OF ENERGY SAVINGS PERFORMANCE CONTRACT
SUNSET.

Section 801(c) of the National Energy Conservation Policy
Act (42 U.S.C. 8287(c)) is repealed.

SEC. 916. ENERGY SAVINGS PERFORMANCE CONTRACT DEFINITIONS.

(a) Energy Savings.--Section 804(2) of the National Energy
Conservation Policy Act (42 U.S.C. 8287c(2)) is amended to
read as follows:
``(2) The term `energy savings' means a reduction in the
cost of energy or water, from a base cost established through
a methodology set forth in the contract, used in an existing
federally owned building or buildings or other federally
owned facilities as a result of--
``(A) the lease or purchase of operating equipment,
improvements, altered operation and maintenance, or technical
services;
``(B) the increased efficient use of existing energy
sources by cogeneration or heat recovery, excluding any
cogeneration process for other than a federally owned
building or buildings or other federally owned facilities; or
``(C) the increased efficient use of existing water
sources.''.
(b) Energy Savings Contract.--Section 804(3) of the
National Energy Conservation Policy Act (42 U.S.C. 8287c(3))
is amended to read as follows:
``(3) The terms `energy savings contract' and `energy
savings performance contract' mean a contract which provides
for the performance of services for the design, acquisition,
installation, testing, operation, and, where appropriate,
maintenance and repair, of an identified energy or water
conservation measure or series of measures at one or more
locations.''.
(c) Energy or Water Conservation Measure.--Section 804(4)
of the National Energy Conservation Policy Act (42 U.S.C.
8287c(4)) is amended to read as follows:
``(4) The term `energy or water conservation measure'
means--
``(A) an energy conservation measure, as defined in section
551(4) (42 U.S.C. 8259(4)); or
``(B) a water conservation measure that improves water
efficiency, is life cycle cost effective, and involves water
conservation, water recycling or reuse, more efficient
treatment of wastewater or stormwater, improvements in
operation or maintenance efficiencies, retrofit activities or
other related activities, not at a Federal hydroelectric
facility.''.

SEC. 917. REVIEW OF ENERGY SAVINGS PERFORMANCE CONTRACT
PROGRAM.

Within 180 days after the date of the enactment of this
Act, the Secretary of Energy shall complete a review of the
Energy Savings Performance Contract program to identify
statutory, regulatory, and administrative obstacles that
prevent Federal agencies from fully utilizing the program. In
addition, this review shall identify all areas for increasing
program flexibility and effectiveness, including audit and
measurement verification requirements, accounting for energy
use in determining savings, contracting requirements, and
energy efficiency services covered. The Secretary shall
report these findings to the Committee on Energy and Commerce
of the House of Representatives and the Committee on Energy
and Natural Resources of the Senate, and shall implement
identified administrative and regulatory changes to increase
program flexibility and effectiveness to the extent that such
changes are consistent with statutory authority.

SEC. 918. FEDERAL ENERGY BANK.

Part 3 of title V of the National Energy Conservation
Policy Act is amended by adding at the end the following:

``SEC. 553. FEDERAL ENERGY BANK.

``(a) Definitions.--In this section:
``(1) Bank.--The term `Bank' means the Federal Energy Bank
established by subsection (b).
``(2) Energy or water efficiency project.--The term `energy
or water efficiency project' means a project that assists a
Federal agency in meeting or exceeding the energy or water
efficiency requirements of--
``(A) this part;
``(B) title VIII;
``(C) subtitle F of title I of the Energy Policy Act of
1992 (42 U.S.C. 8262 et seq.); or
``(D) any applicable Executive order, including Executive
Order No. 13123.
``(3) Federal agency.--The term `Federal agency' means--
``(A) an Executive agency (as defined in section 105 of
title 5, United States Code);
``(B) the United States Postal Service;
``(C) Congress and any other entity in the legislative
branch; and
``(D) a Federal court and any other entity in the judicial
branch.
``(b) Establishment of Bank.--

[[Page S10775]]

``(1) In general.--There is established in the Treasury of
the United States a fund to be known as the `Federal Energy
Bank', consisting of--
``(A) such amounts as are deposited in the Bank under
paragraph (2);
``(B) such amounts as are repaid to the Bank under
subsection (c)(2)(D); and
``(C) any interest earned on investment of amounts in the
Bank under paragraph (3).
``(2) Deposits in bank.--
``(A) In general.--Subject to the availability of
appropriations and to subparagraph (B), the Secretary of the
Treasury shall deposit in the Bank an amount equal to
$250,000,000 in fiscal year 2003 and in each fiscal year
thereafter.
``(B) Maximum amount in bank.--Deposits under subparagraph
(A) shall cease beginning with the fiscal year following the
fiscal year in which the amounts in the Bank (including
amounts on loan from the Bank) become equal to or exceed
$1,000,000,000.
``(3) Investment of amounts.--The Secretary of the Treasury
shall invest such portion of the Bank as is not, in the
judgment of the Secretary, required to meet current
withdrawals. Investments may be made only in interest-bearing
obligations of the United States.
``(c) Loans From the Bank.--
``(1) In general.--The Secretary of the Treasury shall
transfer from the Bank to the Secretary such amounts as are
appropriated to carry out the loan program under paragraph
(2).
``(2) Loan program.--
``(A) Establishment.--
``(i) In general.--In accordance with subsection (d), the
Secretary, in consultation with the Secretary of Defense, the
Administrator of General Services, and the Director of the
Office of Management and Budget, shall establish a program to
make loans of amounts in the Bank to any Federal agency that
submits an application satisfactory to the Secretary in order
to pay the costs of a project described in subparagraph (C).
``(ii) Commencement of operations.--The Secretary may
begin--

``(I) accepting applications for loans from the Bank in
fiscal year 2002; and
``(II) making loans from the Bank in fiscal year 2003.

``(B) Energy savings performance contracting funding.--To
the extent practicable, an agency shall not submit a project
for which energy performance contracting funding is available
and is acceptable to the Federal agency under title VIII.
``(C) Purposes of loan.--
``(i) In general.--A loan from the Bank may be used to
pay--

``(I) the costs of an energy or water efficiency project,
or a renewable or alternative energy project, for a new or
existing Federal building (including selection and design of
the project);
``(II) the costs of an energy metering plan and metering
equipment installed pursuant to section 543(e) or for the
purpose of verification of the energy savings under an energy
savings performance contract under title VIII; or
``(III) at the time of contracting, the costs of cofunding
of an energy savings performance contract (including a
utility energy service agreement) in order to shorten the
payback period of the project that is the subject of the
energy savings performance contract.

``(ii) Limitation.--A Federal agency may use not more than
10 percent of the amount of a loan under subclause (I) or
(II) of clause (i) to pay the costs of administration and
proposal development (including data collection and energy
surveys).
``(iii) Renewable and alternative energy projects.--Not
more than 25 percent of the amount on loan from the Bank at
any time may be loaned for renewable energy and alternative
energy projects (as defined by the Secretary in accordance
with applicable law (including Executive Orders)).
``(D) Repayments.--
``(i) In general.--Subject to clauses (ii) through (iv), a
Federal agency shall repay to the Bank the principal amount
of a loan plus interest at a rate determined by the
President, in consultation with the Secretary and the
Secretary of the Treasury.
``(ii) Waiver or reduction of interest.--The Secretary may
waive or reduce the rate of interest required to be paid
under clause (i) if the Secretary determines that payment of
interest by a Federal agency at the rate determined under
that clause is not required to fund the operations of the
Bank.
``(iii) Determination of interest rate.--The interest rate
determined under clause (i) shall be at a rate that is
sufficient to ensure that, beginning not later than October
1, 2007, interest payments will be sufficient to fully fund
the operations of the Bank.
``(iv) Insufficiency of appropriations.--

``(I) Request for appropriations.--As part of the budget
request of the Federal agency for each fiscal year, the head
of each Federal agency shall submit to the President a
request for such amounts as are necessary to make such
repayments as are expected to become due in the fiscal year
under this subparagraph.
``(II) Suspension of repayment requirement.--If, for any
fiscal year, sufficient appropriations are not made available
to a Federal agency to make repayments under this
subparagraph, the Bank shall suspend the requirement of
repayment under this subparagraph until such appropriations
are made available.

``(E) Federal agency energy budgets.--Until a loan is
repaid, a Federal agency budget submitted by the President to
Congress for a fiscal year shall not be reduced by the value
of energy savings accrued as a result of any energy
conservation measure implemented using amounts from the Bank.
``(F) No rescission or reprogramming.--A Federal agency
shall not rescind or reprogram loan amounts made available
from the Bank except as permitted under guidelines issued
under subparagraph (G).
``(G) Guidelines.--The Secretary shall issue guidelines for
implementation of the loan program under this paragraph,
including selection criteria, maximum loan amounts, and loan
repayment terms.
``(d) Selection Criteria.--
``(1) In general.--The Secretary shall establish criteria
for the selection of projects to be awarded loans in
accordance with paragraph (2).
``(2) Selection criteria.--
``(A) In general.--The Secretary may make loans from the
Bank only for a project that--
``(i) is technically feasible;
``(ii) is determined to be cost-effective using life cycle
cost methods established by the Secretary;
``(iii) includes a measurement and management component,
based on the measurement and verification protocols of the
Department of Energy, to--

``(I) commission energy savings for new and existing
Federal facilities;
``(II) monitor and improve energy efficiency management at
existing Federal facilities; and
``(III) verify the energy savings under an energy savings
performance contract under title VIII; and

``(iv)(I) in the case of a renewable energy or alternative
energy project, has a simple payback period of not more than
15 years; and
``(II) in the case of any other project, has a simple
payback period of not more than 10 years.
``(B) Priority.--In selecting projects, the Secretary shall
give priority to projects that--
``(i) are a component of a comprehensive energy management
project for a Federal facility; and
``(ii) are designed to significantly reduce the energy use
of the Federal facility.
``(e) Reports and Audits.--
``(1) Reports to the secretary.--Not later than 1 year
after the completion of installation of a project that has a
cost of more than $1,000,000, and annually thereafter, a
Federal agency shall submit to the Secretary a report that--
``(A) states whether the project meets or fails to meet the
energy savings projections for the project; and
``(B) for each project that fails to meet the energy
savings projections, states the reasons for the failure and
describes proposed remedies.
``(2) Audits.--The Secretary may audit, or require a
Federal agency that receives a loan from the Bank to audit,
any project financed with amounts from the Bank to assess the
performance of the project.
``(3) Reports to congress.--At the end of each fiscal year,
the Secretary shall submit to Congress a report on the
operations of the Bank, including a statement of--
``(A) the total receipts by the Bank;
``(B) the total amount of loans from the Bank to each
Federal agency; and
``(C) the estimated cost and energy savings resulting from
projects funded with loans from the Bank.
``(f) Authorization of Appropriations.--There are
authorized to be appropriated such sums as are necessary to
carry out this section.''.

SEC. 919. ENERGY AND WATER SAVING MEASURES IN CONGRESSIONAL
BUILDINGS.

(a) In General.--Part 3 of title V of the National Energy
Conservation Policy Act is amended by adding at the end:

``SEC. 554. ENERGY AND WATER SAVINGS MEASURES IN
CONGRESSIONAL BUILDINGS.

``(a) In General.--The Architect of the Capitol--
``(1) shall develop, update, and implement a cost-effective
energy conservation and management plan (referred to in this
section as the ``plan'') for all facilities administered by
the Congress (referred to in this section as `congressional
buildings') to meet the energy performance requirements for
Federal buildings established under section 543(a)(1); and
``(2) shall submit the plan to Congress, not later than 180
days after the date of enactment of this section.
``(b) Plan Requirements.--The plan shall include--
``(1) a description of the life-cycle cost analysis used to
determine the cost-effectiveness of proposed energy
efficiency projects;
``(2) a schedule of energy surveys to ensure complete
surveys of all congressional buildings every 5 years to
determine the cost and payback period of energy and water
conservation measures;
``(3) a strategy for installation of life cycle cost
effective energy and water conservation measures;
``(4) the results of a study of the costs and benefits of
installation of submetering in congressional buildings; and
``(5) information packages and `how-to' guides for each
Member and employing authority of Congress that detail
simple, cost-effective methods to save energy and taxpayer
dollars in the workplace.
``(c) Contracting Authority.--The Architect--
``(1) may contract with nongovernmental entities and use
private sector capital to finance energy conservation
projects and meet energy performance requirements; and
``(2) may use innovative contracting methods that will
attract private sector funding for the installation of energy
efficient and renewable energy technology, such as energy
savings performance contracts described in title VIII.
``(d) Capitol Visitor Center.--The Architect--
``(1) shall ensure that state-of-the-art energy efficiency
and renewable energy technologies

[[Page S10776]]

are used in the construction and design of the Visitor
Center; and
``(2) shall include in the Visitor Center an exhibit on the
energy efficiency and renewable energy measures used in
congressional buildings.
``(e) Annual Report.--The Architect shall submit to
Congress annually a report on congressional energy management
and conservation programs required under this section that
describes in detail--
``(1) energy expenditures and savings estimates for each
facility;---
``(2) energy management and conservation projects; and
``(3) future priorities to ensure compliance with this
section.''.
(b) Repeal.--Section 310 of the Legislative Branch
Appropriations Act, 1999 (40 U.S.C. 166i), is repealed.

SEC. 920. INCREASED USE OF RECOVERED MATERIAL IN FEDERALLY
FUNDED PROJECTS INVOLVING PROCUREMENT OF CEMENT
OR CONCRETE.

(a) Definitions.--In this section:
(1) Administrator.--The term ``Administrator'' means the
Administrator of the Environmental Protection Agency.
(2) Agency head.--The term ``agency head'' means--
(A) the Secretary of Transportation; and
(B) the head of each other Federal agency that on a regular
basis procures, or provides Federal funds to pay or assist in
paying the cost of procuring, material for cement or concrete
projects.
(3) Cement or concrete project.--The term ``cement or
concrete project'' means a project for the construction or
maintenance of a highway or other transportation facility or
a Federal, State, or local government building or other
public facility that--
(A) involves the procurement of cement or concrete; and
(B) is carried out in whole or in part using Federal funds.
(4) Recovered material.--The term ``recovered material''
means--
(A) ground granulated blast furnace slag;
(B) coal combustion fly ash; and
(C) any other waste material or byproduct recovered or
diverted from solid waste that the Administrator, in
consultation with an agency head, determines should be
treated as recovered material under this section for use in
cement or concrete projects paid for, in whole or in part, by
the agency head.
(b) Implementation of Requirements.--
(1) In general.--Not later than 1 year after the date of
enactment of this Act, the Administrator and each agency head
shall take such actions as are necessary to implement fully
all procurement requirements and incentives in effect as of
the date of enactment of this Act (including guidelines under
section 6002 of the Solid Waste Disposal Act (42 U.S.C.
6963)) that provide for the use of cement and concrete
incorporating recovered material in cement or concrete
projects.
(2) Priority.--In carrying out paragraph (1) an agency head
shall give priority to achieving greater use of recovered
material in cement or concrete projects for which recovered
materials historically have not been used or have been used
only minimally.
(c) Full Implementation Study.--
(1) In general.--The Administrator and the Secretary of
Transportation, in cooperation with the Secretary of Energy,
shall conduct a study to determine the extent to which
current procurement requirements, when fully implemented in
accordance with subsection (b), may realize energy savings
and greenhouse gas emission reduction benefits attainable
with substitution of recovered material in cement used in
cement or concrete projects.
(2) Matters to be addressed.--The study shall--
(A) quantify the extent to which recovered materials are
being substituted for Portland cement, particularly as a
result of current procurement requirements, and the energy
savings and greenhouse gas emission reduction benefits
associated with that substitution;
(B) identify all barriers in procurement requirements to
fuller realization of energy savings and greenhouse gas
emission reduction benefits, including barriers resulting
from exceptions from current law; and
(C)(i) identify potential mechanisms to achieve greater
substitution of recovered material in types of cement or
concrete projects for which recovered materials historically
have not been used or have been used only minimally;
(ii) evaluate the feasibility of establishing guidelines or
standards for optimized substitution rates of recovered
material in those cement or concrete projects; and
(iii) identify any potential environmental or economic
effects that may result from greater substitution of
recovered material in those cement or concrete projects.
(3) Report.--Not later than 30 months after the date of
enactment of this Act, the Secretary shall submit to the
Committee on Appropriations and Committee on Environment and
Public Works of the Senate and the Committee on
Appropriations and Committee on Energy and Commerce of the
House of Representatives a report on the study.
(d) Additional Procurement Requirements.--Within 1 year of
the release of the report in accordance with subsection
(c)(3), the Administrator and each agency head shall take
additional actions authorized under the Solid Waste Disposal
Act (42 U.S.C. 6901 et seq.) to establish procurement
requirements and incentives that provide for the use of
cement and concrete with increased substitution of recovered
material in the construction and maintenance of cement or
concrete projects, so as to--
(1) realize more fully the energy savings and greenhouse
gas emission reduction benefits associated with increased
substitution; and
(2) eliminate barriers identified under subsection (c).
(e) Effect of Section.--Nothing in this section affects the
requirements of section 6002 of the Solid Waste Disposal Act
(42 U.S.C. 6962) (including the guidelines and specifications
for implementing those requirements).

Subtitle C--Industrial Efficiency and Consumer Products

SEC. 921. VOLUNTARY COMMITMENTS TO REDUCE INDUSTRIAL ENERGY
INTENSITY.

(a) Voluntary Agreements.--The Secretary of Energy shall
enter into voluntary agreements with one or more persons in
industrial sectors that consume significant amounts of
primary energy per unit of physical output to reduce the
energy intensity of their production activities.
(b) Goal.--Voluntary agreements under this section shall
have a goal of reducing energy intensity by not less than 2.5
percent each year from 2002 through 2012.
(c) Recognition.--The Secretary of Energy, in cooperation
with the Administrator of the Environmental Protection Agency
and other appropriate Federal agencies, shall develop
mechanisms to recognize and publicize the achievements of
participants in voluntary agreements under this section.
(d) Definition.--In this section, the term ``energy
intensity'' means the primary energy consumed per unit of
physical output in an industrial process.
(e) Technical Assistance.--An entity that enters into an
agreement under this section and continues to make a good
faith effort to achieve the energy efficiency goals specified
in the agreement shall be eligible to receive from the
Secretary a grant or technical assistance as appropriate to
assist in the achievement of those goals.
(f) Report.--Not later than June 30, 2008 and June 30,
2012, the Secretary shall submit to Congress a report that
evaluates the success of the voluntary agreements, with
independent verification of a sample of the energy savings
estimates provided by participating firms.

SEC. 922. AUTHORITY TO SET STANDARDS FOR COMMERCIAL PRODUCTS.

Part B of title III of the Energy Policy and Conservation
Act (42 U.S.C. 6291 et seq.) is amended as follows:
(1) In the heading for such part, by inserting ``AND
COMMERCIAL'' after ``CONSUMER''.
(2) In section 321(2), by inserting ``or commercial'' after
``consumer''.
(3) In paragraphs (4), (5), and (15) of section 321, by
striking ``consumer'' each place it appears and inserting
``covered''.
(4) In section 322(a), by inserting ``or commercial'' after
``consumer'' the first place it appears in the material
preceding paragraph (1).
(5) In section 322(b), by inserting ``or commercial'' after
``consumer'' each place it appears.
(6) In section 322 (b)(1)(B) and (b)(2)(A), by inserting
``or per-business in the case of a commercial product'' after
``per-household'' each place it appears.
(7) In section 322 (b)(2)(A), by inserting ``or businesses
in the case of commercial products'' after ``households''
each place it appears.
(8) In section 322 (B)(2)(C)--
(A) by striking ``term'' and inserting ``terms''; and
(B) by inserting ``and `business' '' after `` `household'
''.
(9) In section 323 (b)(1) (B) by inserting ``or
commercial'' after ``consumer''.

SEC. 923. ADDITIONAL DEFINITIONS.

Section 321 of the Energy Policy and Conservation Act (42
U.S.C. 6291) is amended by adding at the end the following:
``(32) The term `battery charger' means a device that
charges batteries for consumer products.
``(33) The term `commercial refrigerator, freezer and
refrigerator-freezer' means a refrigerator, freezer or
refrigerator-freezer that--
``(A) is not a consumer product regulated under this Act;
and
``(B) incorporates most components involved in the vapor-
compression cycle and the refrigerated compartment in a
single package.
``(34) The term `external power supply' means an external
power supply circuit that is used to convert household
electric current into either DC current or lower-voltage AC
current to operate a consumer product.
``(35) The term `illuminated exit sign' means a sign that--
``(A) is designed to be permanently fixed in place to
identify an exit; and
``(B) consists of--
``(i) an electrically powered integral light source that
illuminates the legend `EXIT' and any directional indicators;
and
``(ii) provides contrast between the legend, any
directional indicators, and the background.
``(36)(A) Except as provided in subsection (B), the term
`low-voltage dry-type transformer' means a transformer that--
``(i) has an input voltage of 600 volts or less;
``(ii) is air-cooled;
``(iii) does not use oil as a coolant; and
``(iv) is rated for operation at a frequency of 60 Hertz.
``(B) The term `low-voltage dry-type transformer' does not
include--
``(i) transformers with multiple voltage taps, with the
highest voltage tap equaling at least 20 percent more than
the lowest voltage tap;
``(ii) transformers that are designed to be used in a
special purpose application, such as transformers commonly
known as drive transformers, rectifier transformers,
autotransformers, Uninterruptible Power System transformers,
impedance transformers, harmonic transformers, regulating
transformers, sealed and nonventilating transformers, machine
tool transformers, welding transformers, grounding
transformers, or testing transformers; or

[[Page S10777]]

``(iii) any transformer not listed in clause (ii) that is
excluded by the Secretary by rule because the transformer is
designed for a special application and the application of
standards to the transformer would not result in significant
energy savings.
``(37) The term `standby mode' means the lowest amount of
electric power used by a household appliance when not
performing its active functions, as defined on an individual
product basis by the Secretary.
``(38) The term `torchiere' means a portable electric lamp
with a reflector bowl that directs light upward so as to give
indirect illumination.
``(39) The term `transformer' means a device consisting of
two or more coils of insulated wire that transfers
alternating current by electromagnetic induction from one
coil to another to change the original voltage or current
value.
``(40) The term `unit heater' means a self-contained fan-
type heater designed to be installed within the heated space,
except that such term does not include a warm air furnace.
``(41) The term `traffic signal module' means a standard 8-
inch (200mm) or 12-inch (300mm) traffic signal indication,
consisting of a light source, a lens, and all other parts
necessary for operation, that communicates movement messages
to drivers through red, amber, and green colors.''.

SEC. 924. ADDITIONAL TEST PROCEDURES.

(a) Exit Signs.--Section 323(b) of the Energy Policy and
Conservation Act (42 U.S.C. 6293) is amended by adding at the
end the following:
``(9) Test procedures for illuminated exit signs shall be
based on the test method used under the Energy Star program
of the Environmental Protection Agency for illuminated exit
signs, as in effect on the date of enactment of this
paragraph.
``(10) Test procedures for low voltage dry-type
distribution transformers shall be based on the `Standard
Test Method for Measuring the Energy Consumption of
Distribution Transformers' prescribed by the National
Electrical Manufacturers Association (NEMA TP 2-1998). The
Secretary may review and revise this test procedure based on
future revisions to such standard test method.
``(11) Test procedures for traffic signal modules shall be
based on the test method used under the Energy Star program
of the Environmental Protection Agency for traffic signal
modules, as in effect on the date of enactment of this
paragraph.''.
(b) Additional Consumer and Commercial Products.--Section
323 of the Energy Policy and Conservation Act (42 U.S.C.
6293) is further amended by adding at the end the following:
``(f) Additional Consumer and Commercial Products.--The
Secretary shall within 24 months after the date of enactment
of this subsection prescribe testing requirements for
suspended ceiling fans, refrigerated bottled or canned
beverage vending machines, commercial unit heaters, and
commercial refrigerators, freezers and refrigerator-freezers.
Such testing requirements shall be based on existing test
procedures used in industry to the extent practical and
reasonable. In the case of suspended ceiling fans, such test
procedures shall include efficiency at both maximum output
and at an output no more than 50 percent of the maximum
output.''.

SEC. 925. ENERGY LABELING.

(a) Rulemaking on Effectiveness of Consumer Product
Labeling.--Paragraph (2) of section 324(a) of the Energy
Policy and Conservation Act (42 U.S.C. 6294(a)(2)) is amended
by adding at the end the following:
``(F) Not later than 3 months after the date of enactment
of this subparagraph, the Commission shall initiate a
rulemaking to consider the effectiveness of the current
consumer products labeling program in assisting consumers in
making purchasing decisions and improving energy efficiency
and to consider changes to the labeling rules that would
improve the effectiveness of consumer product labels. Such
rulemaking shall be completed within 15 months of the date of
enactment of this subparagraph.''.
(b) Rulemaking on Labeling for Additional Products.--
Section 324(a) of the Energy Policy and Conservation Act (42
U.S.C. 6294(a)) is further amended by adding at the end the
following:
``(5) The Secretary shall within 6 months after the date on
which energy conservation standards are prescribed by the
Secretary for covered products referred to in subsections (u)
and (v) of section 325, and within 18 months of enactment of
this paragraph for products referred to in subsections (w)
through (y) of section 325, prescribe, by rule, labeling
requirements for such products. Labeling requirements adopted
under this paragraph shall take effect on the same date as
the standards set pursuant to sections 325 (v) through
(y).''.

SEC. 926. ENERGY STAR PROGRAM.

The Energy Policy and Conservation Act (42 U.S.C. 6201 and
following) is amended by inserting after section 324 the
following:

``ENERGY STAR PROGRAM

``Sec. 324A. There is established at the Department of
Energy and the Environmental Protection Agency a program to
identify and promote energy-efficient products and buildings
in order to reduce energy consumption, improve energy
security, and reduce pollution through labeling of products
and buildings that meet the highest energy efficiency
standards. Responsibilities under the program shall be
divided between the Department of Energy and the
Environmental Protection Agency consistent with the terms of
agreements between the two agencies. The Administrator and
the Secretary shall--
``(1) promote Energy Star compliant technologies as the
preferred technologies in the marketplace for achieving
energy efficiency and to reduce pollution;
``(2) work to enhance public awareness of the Energy Star
label, including special outreach to small businesses;
``(3) preserve the integrity of the Energy Star label; and
``(4) solicit the comments of interested parties in
establishing a new Energy Star product category or in
revising a product category, and upon adoption of a new or
revised product category provide an explanation of the
decision that responds to significant public comments.''.

SEC. 927. ENERGY CONSERVATION STANDARDS FOR CENTRAL AIR
CONDITIONERS AND HEAT PUMPS.

Section 325(d)(3) of the Energy Policy and Conservation Act
(42 U.S.C. 6295(d)) is amended by adding at the end the
following:
``(C) Revision of standards.--Not later than 60 days after
the date of enactment of this subparagraph, the Secretary
shall amend the standards established under paragraph (1).''.

SEC. 928. ENERGY CONSERVATION STANDARDS FOR ADDITIONAL
CONSUMER AND COMMERCIAL PRODUCTS.

Section 325 of the Energy Policy and Conservation Act (42
U.S.C. 6295) is amended by adding at the end the following:
``(u) Standby Mode Electric Energy Consumption.--
``(1) Initial rulemaking.--(A) The Secretary shall, within
18 months after the date of enactment of this subsection,
prescribe by notice and comment, definitions of standby mode
and test procedures for the standby mode power use of battery
chargers and external power supplies. In establishing these
test procedures, the Secretary shall consider, among other
factors, existing test procedures used for measuring energy
consumption in standby mode and assess the current and
projected future market for battery chargers and external
power supplies. This assessment shall include estimates of
the significance of potential energy savings from technical
improvements to these products and suggested product classes
for standards. Prior to the end of this time period, the
Secretary shall hold a scoping workshop to discuss and
receive comments on plans for developing energy conservation
standards for standby mode energy use for these products.
``(B) The Secretary shall, within 3 years after the date of
enactment of this subsection, issue a final rule that
determines whether energy conservation standards shall be
promulgated for battery chargers and external power supplies
or classes thereof. For each product class, any such
standards shall be set at the lowest level of standby energy
use that--
``(i) meets the criteria of subsections (o), (p), (q), (r),
(s) and (t); and
``(ii) will result in significant overall annual energy
savings, considering both standby mode and other operating
modes.
``(2) Designation of additional covered products.--(A) Not
later than 180 days after the date of enactment of this
subsection, the Secretary shall publish for public comment
and public hearing a notice to determine whether any
noncovered products should be designated as covered products
for the purpose of instituting a rulemaking under this
section to determine whether an energy conservation standard
restricting standby mode energy consumption, should be
promulgated; providing that any restriction on standby mode
energy consumption shall be limited to major sources of such
consumption.
``(B) In making the determinations pursuant to subparagraph
(A) of whether to designate new covered products and
institute rulemakings, the Secretary shall, among other
relevant factors and in addition to the criteria in section
322(b), consider--
``(i) standby mode power consumption compared to overall
product energy consumption; and
``(ii) the priority and energy savings potential of
standards which may be promulgated under this subsection
compared to other required rulemakings under this section and
the available resources of the Department to conduct such
rulemakings.
``(C) Not later than 1 year after the date of enactment of
this subsection, the Secretary shall issue a determination of
any new covered products for which he intends to institute
rulemakings on standby mode pursuant to this section and he
shall state the dates by which he intends to initiate those
rulemakings.
``(3) Review of standby energy use in covered products.--In
determining pursuant to section 323 whether test procedures
and energy conservation standards pursuant to section 325
should be revised, the Secretary shall consider for covered
products which are major sources of standby mode energy
consumption whether to incorporate standby mode into such
test procedures and energy conservation standards, taking
into account, among other relevant factors, the criteria for
non-covered products in subparagraph (B) of this subsection.
``(4) Rulemaking for standby mode.--(A) Any rulemaking
instituted under this subsection or for covered products
under this section which restricts standby mode power
consumption shall be subject to the criteria and procedures
for issuing energy conservation standards set forth in
section 325 and the criteria set forth in paragraph 2(B) of
this subsection.
``(B) No standard can be proposed for new covered products
or covered products in a standby mode unless the Secretary
has promulgated applicable test procedures for each product
pursuant to section 323.
``(C) The provisions of section 327 shall apply to new
covered products which are subject to the rulemakings for
standby mode after a final rule has been issued.
``(5) Effective date.--Any standard promulgated under this
subsection shall be applicable to products manufactured or
imported 3 years after the date of promulgation.

[[Page S10778]]

``(6) Voluntary programs to reduce standby mode energy
use.--The Secretary and the Administrator shall collaborate
and develop programs, including programs pursuant to section
324A and other voluntary industry agreements or codes of
conduct, which are designed to reduce standby mode energy
use.
``(v) Suspended Ceiling Fans, Vending Machines, Unit
Heaters, and Commercial Refrigerators, Freezers and
Refrigerator-Freezers.--The Secretary shall within 24 months
after the date on which testing requirements are prescribed
by the Secretary pursuant to section 323(f), prescribe, by
rule, energy conservation standards for suspended ceiling
fans, refrigerated bottled or canned beverage vending
machines, unit heaters, and commercial refrigerators,
freezers and refrigerator-freezers. In establishing standards
under this subsection, the Secretary shall use the criteria
and procedures contained in subsections (l) and (m). Any
standard prescribed under this subsection shall apply to
products manufactured 3 years after the date of publication
of a final rule establishing such standard.
``(w) Illuminated Exit Signs.--Illuminated exit signs
manufactured on or after January 1, 2005 shall meet the
Energy Star Program performance requirements for illuminated
exit signs prescribed by the Environmental Protection Agency
as in effect on the date of enactment of this subsection.
``(x) Torchieres.--Torchieres manufactured on or after
January 1, 2005--
``(1) shall consume not more than 190 watts of power; and
``(2) shall not be capable of operating with lamps that
total more than 190 watts.
``(y) Low Voltage Dry-Type Transformers.--The efficiency of
low voltage dry-type transformers manufactured on or after
January 1, 2005 shall be the Class I Efficiency Levels for
low voltage dry-type transformers specified in Table 4-2 of
the `Guide for Determining Energy Efficiency for Distribution
Transformers' published by the National Electrical
Manufacturers Association (NEMA TP-1-1996).
``(z) Traffic Signal Modules.--Traffic signal modules
manufactured on or after January 1, 2006 shall meet the
performance requirements used under the Energy Star program
of the Environmental Protection Agency for traffic signals,
as in effect on the date of enactment of this paragraph, and
shall be installed with compatible, electrically-connected
signal control interface devices and conflict monitoring
systems.''.

SEC. 929. CONSUMER EDUCATION ON ENERGY EFFICIENCY BENEFITS OF
AIR CONDITIONING, HEATING, AND VENTILATION
MAINTENANCE.

Section 337 of the Energy Policy and Conservation Act (42
U.S.C. 6307) is amended by adding at the end the following:
``(c) HVAC Maintenance.--(1) For the purpose of ensuring
that installed air conditioning and heating systems operate
at their maximum rated efficiency levels, the Secretary
shall, within 180 days of the date of enactment of this
subsection, carry out a program to educate homeowners and
small business owners concerning the energy savings resulting
from properly conducted maintenance of air conditioning,
heating, and ventilating systems.
``(2) The Secretary may carry out the program in
cooperation with industry trade associations, industry
members, and energy efficiency organizations.
``(d) Small Business Education and Assistance.--The
Administrator of the Small Business Administration, in
consultation with the Secretary of Energy and the
Administrator of the Environmental Protection Agency, shall
develop and coordinate a Government-wide program, building on
the existing Energy Star for Small Business Program, to
assist small business to become more energy efficient,
understand the cost savings obtainable through efficiencies,
and identify financing options for energy efficiency
upgrades. The Secretary and the Administrator shall make the
program information available directly to small businesses
and through other Federal agencies, including the Federal
Emergency Management Agency, and the Department of
Agriculture.''.

SEC. 930. STUDY OF ENERGY EFFICIENCY STANDARDS.

The Secretary of Energy shall contract with the National
Academy of Sciences for a study, to be completed within 1
year of enactment of this Act, to examine whether the goals
of energy efficiency standards are best served by measurement
of energy consumed, and efficiency improvements, at the
actual site of energy consumption, or through the full fuel
cycle, beginning at the source of energy production. The
Secretary shall submit the report to the Congress.

Subtitle D--Housing Efficiency

SEC. 931. CAPACITY BUILDING FOR ENERGY EFFICIENT, AFFORDABLE
HOUSING.

Section 4(b) of the HUD Demonstration Act of 1993 (42
U.S.C. 9816 note) is amended--
(1) in paragraph (1), by inserting before the semicolon at
the end the following: ``, including capabilities regarding
the provision of energy efficient, affordable housing and
residential energy conservation measures''; and
(2) in paragraph (2), by inserting before the semicolon the
following: ``, including such activities relating to the
provision of energy efficient, affordable housing and
residential energy conservation measures that benefit low-
income families''.

SEC. 932. INCREASE OF CDBG PUBLIC SERVICES CAP FOR ENERGY
CONSERVATION AND EFFICIENCY ACTIVITIES.

Section 105(a)(8) of the Housing and Community Development
Act of 1974 (42 U.S.C. 5305(a)(8)) is amended--
(1) by inserting ``or efficiency'' after ``energy
conservation'';
(2) by striking ``, and except that'' and inserting ``;
except that''; and
(3) by inserting before the period at the end the
following: ``; and except that each percentage limitation
under this paragraph on the amount of assistance provided
under this title that may be used for the provision of public
services is hereby increased by 10 percent, but such
percentage increase may be used only for the provision of
public services concerning energy conservation or
efficiency''.

SEC. 933. FHA MORTGAGE INSURANCE INCENTIVES FOR ENERGY
EFFICIENT HOUSING.

(a) Single Family Housing Mortgage Insurance.--Section
203(b)(2) of the National Housing Act (12 U.S.C. 1709(b)(2))
is amended, in the first undesignated paragraph beginning
after subparagraph (B)(iii) (relating to solar energy
systems)--
(1) by inserting ``or paragraph (10)''; and
(2) by striking ``20 percent'' and inserting ``30
percent''.
(b) Multifamily Housing Mortgage Insurance.--Section 207(c)
of the National Housing Act (12 U.S.C. 1713(c)) is amended,
in the second undesignated paragraph beginning after
paragraph (3) (relating to solar energy systems and
residential energy conservation measures), by striking ``20
percent'' and inserting ``30 percent''.
(c) Cooperative Housing Mortgage Insurance.--Section 213(p)
of the National Housing Act (12 U.S.C. 1715e(p)) is amended
by striking ``20 per centum'' and inserting ``30 percent''.
(d) Rehabilitation and Neighborhood Conservation Housing
Mortgage Insurance.--Section 220(d)(3)(B)(iii) of the
National Housing Act (12 U.S.C. 1715k(d)(3)(B)(iii)) is
amended by striking ``20 per centum'' and inserting ``30
percent''.
(e) Low-Income Multifamily Housing Mortgage Insurance.--
Section 221(k) of the National Housing Act (12 U.S.C.
1715l(k)) is amended by striking ``20 per centum'' and
inserting ``30 percent''.
(f) Elderly Housing Mortgage Insurance.--The proviso at the
end of section 213(c)(2) of the National Housing Act (12
U.S.C. 1715v(c)(2)) is amended by striking ``20 per centum''
and inserting ``30 percent''.
(g) Condominium Housing Mortgage Insurance.--Section 234(j)
of the National Housing Act (12 U.S.C. 1715y(j)) is amended
by striking ``20 per centum'' and inserting ``30 percent''.

SEC. 934. PUBLIC HOUSING CAPITAL FUND.

Section 9(d)(1) of the United States Housing Act of 1937
(42 U.S.C. 1437g(d)(1)) is amended--
(1) in subparagraph (I), by striking ``and'' at the end;
(2) in subparagraph (K), by striking the period at the end
and inserting ``; and''; and
(3) by adding at the end the following new subparagraph:
``(L) improvement of energy and water-use efficiency by
installing fixtures and fittings that conform to the American
Society of Mechanical Engineers/American National Standards
Institute standards A112.19.2-1998 and A112.18.1-2000, or any
revision thereto, applicable at the time of installation, and
by increasing energy efficiency and water conservation by
such other means as the Secretary determines are
appropriate.''.

SEC. 935. GRANTS FOR ENERGY-CONSERVING IMPROVEMENTS FOR
ASSISTED HOUSING.

Section 251(b)(1) of the National Energy Conservation
Policy Act (42 U.S.C. 8231(1)) is amended--
(1) by striking ``financed with loans'' and inserting
``assisted'';
(2) by inserting after ``1959,'' the following: ``which are
eligible multifamily housing projects (as such term is
defined in section 512 of the Multifamily Assisted Housing
Reform and Affordability Act of 1997 (42 U.S.C. 1437f note)
and are subject to a mortgage restructuring and rental
assistance sufficiency plans under such Act,''; and
(3) by inserting after the period at the end of the first
sentence the following new sentence: ``Such improvements may
also include the installation of energy and water conserving
fixtures and fittings that conform to the American Society of
Mechanical Engineers/American National Standards Institute
standards A112.19.2-1998 and A112.18.1-2000, or any revision
thereto, applicable at the time of installation.''.

SEC. 936. NORTH AMERICAN DEVELOPMENT BANK.

Part 2 of subtitle D of title V of the North American Free
Trade Agreement Implementation Act (22 U.S.C. 290m-290m-3) is
amended by adding at the end the following:

``SEC. 545. SUPPORT FOR CERTAIN ENERGY POLICIES.

``Consistent with the focus of the Bank's Charter on
environmental infrastructure projects, the Board members
representing the United States should use their voice and
vote to encourage the Bank to finance projects related to
clean and efficient energy, including energy conservation,
that prevent, control, or reduce environmental pollutants or
contaminants.''.

SEC. 937. CAPITAL FUND.

Section 9 of the United States Housing Act of 1937 (42
U.S.C. 1437g), as amended by section 934, is amended--
(1) in subsection (d)(1)--
(A) in subparagraph (L), by striking the period at the end
and inserting ``; and'';
(B) by redesignating subparagraph (L) as subparagraph (K);
and
(C) by adding at the end the following:
``(L) integrated utility management and capital planning to
maximize energy conservation and efficiency measures.''; and
(2) in subsection (e)(2)(C)--
(A) by striking ``The'' and inserting the following:

[[Page S10779]]

``(i) In general.--The''; and
(B) by adding at the end the following:
``(ii) Third party contracts.--Contracts described in
clause (i) may include contracts for equipment conversions to
less costly utility sources, projects with resident paid
utilities, adjustments to frozen base year consumption,
including systems repaired to meet applicable building and
safety codes and adjustments for occupancy rates increased by
rehabilitation.
``(iii) Term of contract.--The total term of a contract
described in clause (i) shall be for not more than 20 years
to allow longer payback periods for retrofits, including but
not limited to windows, heating system replacements, wall
insulation, site-based generations, and advanced energy
savings technologies, including renewable energy
generation.''.

SEC. 938. ENERGY-EFFICIENT APPLIANCES.

A public housing agency shall purchase energy-efficient
appliances that are Energy Star products as defined in
section 552 of the National Energy Policy and Conservation
Act (as amended by this Act) when the purchase of energy-
efficient appliances is cost-effective to the public housing
agency.

SEC. 939. ENERGY EFFICIENCY STANDARDS.

Section 109 of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 12709) is amended--
(1) in subsection (a)--
(A) in paragraph (1)--
(i) by striking ``the date of the enactment of the Energy
Policy Act of 1992'' and inserting ``September 30, 2002'';
(ii) in subparagraph (A), by striking ``and'' at the end;
(iii) in subparagraph (B), by striking the period at the
end and inserting a semi-colon; and
(iv) by adding at the end the following:
``(C) rehabilitation and new construction of public and
assisted housing funded by HOPE VI revitalization grants,
established under section 24 of the United States Housing Act
of 1937 (42 U.S.C. 1437v), where such standards are
determined to be cost effective by the Secretary of Housing
and Urban Development; and
(B) in paragraph (2), by striking ``Council of American''
and all that follows through ``life-cycle cost basis'' and
inserting ``2000 International Energy Conservation Code'';
(2) in subsection (b)--
(A) by striking ``the date of the enactment of the Energy
Policy Act of 1992'' and inserting ``September 30, 2002'';
and
(B) by striking ``CABO'' and all that follows through
``1989'' and inserting ``the 2000 International Energy
Conservation Code''; and
(3) in subsection (c)--
(A) in the heading, by striking ``Model Energy Code'' and
inserting ``The International Energy Conservation Code''; and
(B) by striking ``CABO'' and all that follows through
``1989'' and inserting ``the 2000 International Energy
Conservation Code''.

SEC. 940. ENERGY STRATEGY FOR HUD.

(a) In General.--The Secretary of Housing and Urban
Development shall develop and implement an integrated
strategy to reduce utility expenses through cost-effective
energy conservation and efficiency measures, design and
construction in public and assisted housing.
(b) Energy Management Office.--The Secretary of Housing and
Urban Development shall create an office at the Department of
Housing and Urban Development for utility management, energy
efficiency, and conservation, with responsibility for
implementing the strategy developed under this section,
including development of a centralized database that monitors
public housing energy usage, and development of energy
reduction goals and incentives for public housing agencies.
The Secretary shall submit an annual report to Congress on
the strategy.

Subtitle E--Rural and Remote Communities

SEC. 941. SHORT TITLE.

This subtitle may be cited as the ``Rural and Remote
Community Fairness Act''.

SEC. 942. FINDINGS AND PURPOSE.

(a) Findings.--The Congress finds that--
(1) a modern infrastructure, including energy-efficient
housing, electricity, telecommunications, bulk fuel,
wastewater and potable water service, is a necessary
ingredient of a modern society and development of a
prosperous economy;
(2) the Nation's rural and remote communities face critical
social, economic and environmental problems, arising in
significant measure from the high cost of infrastructure
development in sparsely populated and remote areas, that are
not adequately addressed by existing Federal assistance
programs;
(3) in the past, Federal assistance has been instrumental
in establishing electric and other utility service in many
developing regions of the Nation, and that Federal assistance
continues to be appropriate to ensure that electric and other
utility systems in rural areas conform with modern standards
of safety, reliability, efficiency and environmental
protection; and
(4) the future welfare of the Nation and the well-being of
its citizens depend on the establishment and maintenance of
viable rural and remote communities as social, economic and
political entities.
(b) Purpose.--The purpose of this subtitle is the
development and maintenance of viable rural and remote
communities through the provision of efficient housing, and
reasonably priced and environmentally sound energy, water,
wastewater, and bulk fuel, telecommunications and utility
services to those communities that do not have those services
or who currently bear costs of those services that are
significantly above the national average.

SEC. 943. DEFINITIONS.

As used in this subtitle:
(1) The term ``unit of general local government'' means any
city, county, town, township, parish, village, borough
(organized or unorganized) or other general purpose political
subdivision of a State, Guam, the Commonwealth of the
Northern Mariana Islands, Puerto Rico, the Republic of the
Marshall Islands, the Federated States of Micronesia, the
Republic of Palau, the Virgin Islands, and American Samoa, a
combination of such political subdivisions that is recognized
by the Secretary; and the District of Columbia; or any other
appropriate organization of citizens of a rural and remote
community that the Secretary may identify.
(2) The term ``population'' means total resident population
based on data compiled by the United States Bureau of the
Census and referable to the same point or period in time.
(3) The term ``Native American group'' means any Indian
tribe, band, group, and nation, including Alaska Indians,
Aleuts, and Eskimos, and any Alaskan Native village, of the
United States, which is considered an eligible recipient
under the Indian Self-Determination and Education Assistance
Act (Public Law 93-638) or was considered an eligible
recipient under chapter 67 of title 31, United States Code,
prior to the repeal of such chapter.
(4) The term ``Secretary'' means the Secretary of Housing
and Urban Development, the Secretary of Agriculture, the
Secretary of the Interior or the Secretary of Energy, as
appropriate.
(5) The term ``rural and remote community'' means a unit of
local general government or Native American group which is
served by an electric utility that has 10,000 or less
customers with an average retail cost per kilowatt hour of
electricity that is equal to or greater than 150 percent of
the average retail cost per kilowatt hour of electricity for
all consumers in the United States, as determined by data
provided by the Energy Information Administration of the
Department of Energy.
(6) The term ``alternative energy sources'' include
nontraditional means of providing electrical energy,
including, but not limited to, wind, solar, biomass,
municipal solid waste, hydroelectric, geothermal and tidal
power.
(7) The term ``average retail cost per kilowatt hour of
electricity'' has the same meaning as ``average revenue per
kilowatt hour of electricity'' as defined by the Energy
Information Administration of the Department of Energy.

SEC. 944. AUTHORIZATION OF APPROPRIATIONS.

The Secretary is authorized to make grants to rural and
remote communities to carry out activities in accordance with
the provisions of this subtitle. For purposes of assistance
under section 947, there are authorized to be appropriated
$100,000,000 for each of fiscal years 2003 through 2009.

SEC. 945. STATEMENT OF ACTIVITIES AND REVIEW.

(a) Statement of Objectives and Projected Use.--Prior to
the receipt in any fiscal year of a grant under section 947
by any rural and remote community, the grantee shall have
prepared and submitted to the Secretary of the agency
providing funding a final statement of rural and remote
community development objectives and projected use of funds.
(b) Public Notice.--In order to permit public examination
and appraisal of such statements, to enhance the public
accountability of grantees, and to facilitate coordination of
activities with different levels of government, the grantee
shall in a timely manner--
(1) furnish citizens information concerning the amount of
funds available for rural and remote community development
activities and the range of activities that may be
undertaken;
(2) publish a proposed statement in such manner to afford
affected citizens an opportunity to examine its content and
to submit comments on the proposed statement and on the
community development performance of the grantee;
(3) provide citizens with reasonable access to records
regarding the past use of funds received under section 947 by
the grantee; and
(4) provide citizens with reasonable notice of, and
opportunity to comment on, any substantial change proposed to
be made in the use of funds received under section 947 from
one eligible activity to another.

The final statement shall be made available to the public,
and a copy shall be furnished to the appropriate Secretary.
Any final statement of activities may be modified or amended
from time to time by the grantee in accordance with the same.
Procedures required in this paragraph are for the preparation
and submission of such statement.
(c) Performance and Evaluation Report.--Each grantee shall
submit to the appropriate Secretary, at a time determined by
the Secretary, a performance and evaluation report,
concerning the use of funds made available under section 947,
together with an assessment by the grantee of the
relationship of such use to the objectives identified in the
grantee's statement under subsection (a) and to the
requirements of subsection (b). The grantee's report shall
indicate its programmatic accomplishments, the nature of and
reasons for any changes in the grantee's program objectives,
and indications of how the grantee would change its programs
as a result of its experiences.
(d) Retention of Income.--
(1) In general.--Any rural and remote community may retain
any program income that is realized from any grant made by
the Secretary under section 947 if--
(A) such income was realized after the initial disbursement
of the funds received by such unit of general local
government under such section; and
(B) such unit of general local government has agreed that
it will utilize the program income for eligible rural and
remote community development activities in accordance with
the provisions of this title.
(2) Exception.--The Secretary may, by regulation, exclude
from consideration as program income any amounts determined
to be so small that compliance with the subsection creates an

[[Page S10780]]

unreasonable administrative burden on the rural and remote
community.

SEC. 946. ELIGIBLE ACTIVITIES.

(a) Activities Included.--Eligible activities assisted
under this subtitle may include only--
(1) weatherization and other cost-effective energy-related
repairs of homes and other buildings;
(2) the acquisition, construction, repair, reconstruction,
or installation of reliable and cost-efficient facilities for
the generation, transmission or distribution of electricity,
and telecommunications, for consumption in a rural and remote
community or communities;
(3) the acquisition, construction, repair, reconstruction,
remediation or installation of facilities for the safe
storage and efficient management of bulk fuel by rural and
remote communities, and facilities for the distribution of
such fuel to consumers in a rural or remote community;
(4) facilities and training to reduce costs of maintaining
and operating generation, distribution or transmission
systems to a rural and remote community or communities;
(5) the institution of professional management and
maintenance services for electricity generation, transmission
or distribution to a rural and remote community or
communities;
(6) the investigation of the feasibility of alternate
energy sources for a rural and remote community or
communities;
(7) acquisition, construction, repair, reconstruction,
operation, maintenance, or installation of facilities for
water or wastewater service;
(8) the acquisition or disposition of real property
(including air rights, water rights, and other interests
therein) for eligible rural and remote community development
activities; and
(9) activities necessary to develop and implement a
comprehensive rural and remote development plan, including
payment of reasonable administrative costs related to
planning and execution of rural and remote community
development activities.
(b) Activities Undertaken Through Electric Utilities.--
Eligible activities may be undertaken either directly by the
rural and remote community, or by the rural and remote
community through local electric utilities.

SEC. 947. ALLOCATION AND DISTRIBUTION OF FUNDS.

For each fiscal year, of the amount approved in an
appropriation Act under section 903 for grants in any year,
the Secretary shall distribute to each rural and remote
community which has filed a final statement of rural and
remote community development objectives and projected use of
funds under section 945, an amount which shall be allocated
among the rural and remote communities that filed a final
statement of rural and remote community development
objectives and projected use of funds under section 945
proportionate to the percentage that the average retail price
per kilowatt hour of electricity for all classes of consumers
in the rural and remote community exceeds the national
average retail price per kilowatt hour for electricity for
all consumers in the United States, as determined by data
provided by the Department of Energy's Energy Information
Administration. In allocating funds under this section, the
Secretary shall give special consideration to those rural and
remote communities that increase economies of scale through
consolidation of services, affiliation and regionalization of
eligible activities under this title.

SEC. 948. RURAL AND REMOTE COMMUNITY ELECTRIFICATION GRANTS.

Section 313 of the Rural Electrification Act of 1936 (7
U.S.C. 940c) is amended by adding after subsection (b) the
following:
``(c) Rural and Remote Communities Electrification
Grants.--The Secretary of Agriculture, in consultation with
the Secretary of Energy and the Secretary of the Interior,
may provide grants under this Act for the purpose of
increasing energy efficiency, siting or upgrading
transmission and distribution lines, or providing or
modernizing electric facilities to--
``(1) a unit of local government of a State or territory;
or
``(2) an Indian tribe or Tribal College or University as
defined in section 316(b)(3) of the Higher Education Act (20
U.S.C. 1059c(b)(3)).
``(d) Grant Criteria.--The Secretary shall make grants
based on a determination of cost-effectiveness and most
effective use of the funds to achieve the stated purposes of
this section.
``(e) Preference.--In making grants under this section, the
Secretary shall give a preference to renewable energy
facilities.
``(f) Definition.--For purposes of this section, 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.
``(g) Authorization.--For the purpose of carrying out
subsection (c), there are authorized to be appropriated to
the Secretary $20,000,000 for each of the 7 fiscal years
following the date of enactment of this subsection.''.

SEC. 949. ADDITIONAL AUTHORIZATION OF APPROPRIATIONS.

There is hereby authorized to be appropriated $5,000,000
for each of fiscal years 2003 through 2009 to the Denali
Commission established by the Denali Commission Act of 1998
(42 U.S.C. 3121 note) for the purposes of funding the power
cost equalization program.

SEC. 950. RURAL RECOVERY COMMUNITY DEVELOPMENT BLOCK GRANTS.

(a) Findings; Purpose.--
(1) Findings.--Congress finds that--
(A) a modern infrastructure, including affordable housing,
wastewater and water service, and advanced technology
capabilities is a necessary ingredient of a modern society
and development of a prosperous economy with minimal
environmental impacts;
(B) the Nation's rural areas face critical social,
economic, and environmental problems, arising in significant
measure from the growing cost of infrastructure development
in rural areas that suffer from low per capita income and
high rates of outmigration and are not adequately addressed
by existing Federal assistance programs; and
(C) the future welfare of the Nation and the well-being of
its citizens depend on the establishment and maintenance of
viable rural areas as social, economic, and political
entities.
(2) Purpose.--The purpose of this section is to provide for
the development and maintenance of viable rural areas through
the provision of affordable housing and community development
assistance to eligible units of general local government and
eligible Native American groups in rural areas with
excessively high rates of outmigration and low per capita
income levels.
(b) Definitions.--In this section:
(1) Eligible unit of general local government.--The term
``eligible unit of general local government'' means a unit of
general local government that is the governing body of a
rural recovery area.
(2) Eligible indian tribe.--The term ``eligible Indian
tribe'' means the governing body of an Indian tribe that is
located in a rural recovery area.
(3) Grantee.--The term ``grantee'' means an eligible unit
of general local government or eligible Indian tribe that
receives a grant under this section.
(4) Native american group.--The term ``Native American
group'' means any Indian tribe, band, group, and nation,
including Alaska Indians, Aleuts, and Eskimos, and any
Alaskan Native village, of the United States, which is
considered an eligible recipient under the Indian Self-
Determination and Education Assistance Act (Public Law 93-
638) or was considered an eligible recipient under chapter 67
of title 31, United States Code, prior to the repeal of such
chapter.
(5) Rural recovery area.--The term ``rural recovery area''
means any geographic area represented by a unit of general
local government or a Native American group--
(A) the borders of which are not adjacent to a metropolitan
area;
(B) in which--
(i) the population outmigration level equals or exceeds 1
percent over the most recent 5 year period, as determined by
the Secretary of Housing and Urban Development; and
(ii) the per capita income is less than that of the
national nonmetropolitan average; and
(C) that does not include a city with a population of more
than 15,000.
(6) Unit of general local government.--
(A) In general.--The term ``unit of general local
government'' means any city, county, town, township, parish,
village, borough (organized or unorganized), or other general
purpose political subdivision of a State; Guam, the
Commonwealth of the Northern Mariana Islands, the Virgin
Islands, Puerto Rico, and American Samoa, or a general
purpose political subdivision thereof; a combination of such
political subdivisions that, except as provided in section
106(d)(4), is recognized by the Secretary; and the District
of Columbia.
(B) Other entities included.--The term also includes a
State or a local public body or agency, community
association, or other entity, that is approved by the
Secretary for the purpose of providing public facilities or
services to a new community.
(7) Secretary.--The term ``Secretary'' means the Secretary
of Housing and Urban Development, the Secretary of
Agriculture, the Secretary of the Interior or the Secretary
of Energy, as appropriate.
(c) Grant Authority.--The Secretary may make grants in
accordance with this section to eligible units of general
local government, Native American groups and eligible Indian
tribes that meet the requirements of subsection (d) to carry
out eligible activities described in subsection (f).
(d) Eligibility Requirements.--
(1) Statement of rural development objectives.--In order to
receive a grant under this section for a fiscal year, an
eligible unit of general local government, Native American
group or eligible Indian tribe--
(A) shall--
(i) publish a proposed statement of rural development
objectives and a description of the proposed eligible
activities described in subsection (f) for which the grant
will be used; and
(ii) afford residents of the rural recovery area served by
the eligible unit of general local government, Native
American groups or eligible Indian tribe with an opportunity
to examine the contents of the proposed statement and the
proposed eligible activities published under clause (i), and
to submit comments to the eligible unit of general local
government, Native American group or eligible Indian tribe,
as applicable, on the proposed statement and the proposed
eligible activities, and the overall community development
performance of the eligible unit of general local government,
Native American groups or eligible Indian tribe, as
applicable; and
(B) based on any comments received under subparagraph
(A)(ii), prepare and submit to the Secretary--
(i) a final statement of rural development objectives;
(ii) a description of the eligible activities described in
subsection (f) for which a grant received under this section
will be used; and
(iii) a certification that the eligible unit of general
local government, Native American

[[Page S10781]]

groups or eligible Indian tribe, as applicable, will comply
with the requirements of paragraph (2).
(2) Public notice and comment.--In order to enhance public
accountability and facilitate the coordination of activities
among different levels of government, an eligible unit of
general local government, Native American groups or eligible
Indian tribe that receives a grant under this section shall,
as soon as practicable after such receipt, provide the
residents of the rural recovery area served by the eligible
unit of general local government, Native American groups or
eligible Indian tribe, as applicable, with--
(A) a copy of the final statement submitted under paragraph
(1)(B);
(B) information concerning the amount made available under
this section and the eligible activities to be undertaken
with that amount;
(C) reasonable access to records regarding the use of any
amounts received by the eligible unit of general local
government, Native American groups or eligible Indian tribe
under this section in any preceding fiscal year; and
(D) reasonable notice of, and opportunity to comment on,
any substantial change proposed to be made in the use of
amounts received under this section from one eligible
activity to another.
(e) Distribution of Grants.--
(1) In General.--In each fiscal year, the Secretary shall
distribute to each eligible unit of general local government,
Native American groups and eligible Indian tribe that meets
the requirements of subsection (d)(1) a grant in an amount
described in paragraph (2).
(2) Amount.--Of the total amount made available to carry
out this section in each fiscal year, the Secretary shall
distribute to each grantee the amount equal to the greater
of--
(A) the pro rata share of the grantee, as determined by the
Secretary, based on the combined annual population
outmigration level (as determined by the Secretary of Housing
and Urban Development) and the per capita income for the
rural recovery area served by the grantee; or
(B) $200,000.
(f) Eligible Activities.--Each grantee shall use amounts
received under this section for one or more of the following
eligible activities, which may be undertaken either directly
by the grantee, or by any local economic development
corporation, regional planning district, nonprofit community
development corporation, or statewide development
organization authorized by the grantee--
(1) the acquisition, construction, repair, reconstruction,
operation, maintenance, or installation of facilities for
water and wastewater service or any other infrastructure
needs determined to be critical to the further development or
improvement of a designated industrial park;
(2) the acquisition or disposition of real property
(including air rights, water rights, and other interests
therein) for rural community development activities;
(3) the development of telecommunications infrastructure
within a designated industrial park that encourages high
technology business development in rural areas;
(4) activities necessary to develop and implement a
comprehensive rural development plan, including payment of
reasonable administrative costs related to planning and
execution of rural development activities; or
(5) affordable housing initiatives.
(g) Performance and Evaluation Report.--
(1) In general.--Each grantee shall annually submit to the
appropriate Secretary a performance and evaluation report,
concerning the use of amounts received under this section.
(2) Contents.--Each report submitted under paragraph (1)
shall include a description of--
(A) the eligible activities carried out by the grantee with
amounts received under this section, and the degree to which
the grantee has achieved the rural development objectives
included in the final statement submitted under subsection
(d)(1);
(B) the nature of and reasons for any change in the rural
development objectives or the eligible activities of the
grantee after submission of the final statement under
subsection (d)(1); and
(C) any manner in which the grantee would change the rural
development objectives of the grantee as a result of the
experience of the grantee in administering amounts received
under this section.
(h) Retention of Income.--A grantee may retain any income
that is realized from the grant, if--
(1) the income was realized after the initial disbursement
of amounts to the grantee under this section; and
(2) the--
(A) grantee agrees to utilize the income for one or more
eligible activities; or
(B) amount of the income is determined by the Secretary to
be so small that compliance with subparagraph (A) would
create an unreasonable administrative burden on the grantee.
(i) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $100,000,000 for
each of fiscal years 2003 through 2009.

DIVISION D--INTEGRATION OF ENERGY POLICY AND CLIMATE CHANGE POLICY

TITLE X--NATIONAL CLIMATE CHANGE POLICY

Subtitle A--Sense of Congress

SEC. 1001. SENSE OF CONGRESS ON CLIMATE CHANGE.

(a) Findings.--The Congress makes the following findings:
(1) Evidence continues to build that increases in
atmospheric concentrations of man-made greenhouse gases are
contributing to global climate change.
(2) The Intergovernmental Panel on Climate Change (IPCC)
has concluded that ``there is new and stronger evidence that
most of the warming observed over the last 50 years is
attributable to human activities'' and that the Earth's
average temperature can be expected to rise between 2.5 and
10.4 degrees Fahrenheit in this century.
(3) The National Academy of Sciences confirmed the findings
of the IPCC, stating that ``the IPCC's conclusion that most
of the observed warming of the last 50 years is likely to
have been due to the increase of greenhouse gas
concentrations accurately reflects the current thinking of
the scientific community on this issue'' and that ``there is
general agreement that the observed warming is real and
particularly strong within the past twenty years''. The
National Academy of Sciences also noted that ``because there
is considerable uncertainty in current understanding of how
the climate system varies naturally and reacts to emissions
of greenhouse gases and aerosols, current estimates of the
magnitude of future warming should be regarded as tentative
and subject to future adjustments upward or downward''.
(4) The IPCC has stated that in the last 40 years, the
global average sea level has risen, ocean heat content has
increased, and snow cover and ice extent have decreased,
which threatens to inundate low-lying island nations and
coastal regions throughout the world.
(5) In October 2000, a United States Government report
found that global climate change may harm the United States
by altering crop yields, accelerating sea-level rise, and
increasing the spread of tropical infectious diseases.
(6) In 1992, the United States ratified the United Nations
Framework Convention on Climate Change (UNFCCC), the ultimate
objective of which is the ``stabilization of greenhouse gas
concentrations in the atmosphere at a level that would
prevent dangerous anthropogenic interference with the climate
system. Such a level should be achieved within a time-frame
sufficient to allow ecosystems to adapt naturally to climate
change, to ensure that food production is not threatened and
to enable economic development to proceed in a sustainable
manner''.
(7) The UNFCCC stated in part that the Parties to the
Convention are to implement policies ``with the aim of
returning . . . to their 1990 levels anthropogenic emissions
of carbon dioxide and other greenhouse gases'' under the
principle that ``policies and measures . . . should be
appropriate for the specific conditions of each Party and
should be integrated with national development programmes,
taking into account that economic development is essential
for adopting measures to address climate change''.
(8) There is a shared international responsibility to
address this problem, as industrial nations are the largest
historic and current emitters of greenhouse gases and
developing nations' emissions will significantly increase in
the future.
(9) The UNFCCC further stated that ``developed country
Parties should take the lead in combating climate change and
the adverse effects thereof'', as these nations are the
largest historic and current emitters of greenhouse gases.
The UNFCCC also stated that ``steps required to understand
and address climate change will be environmentally, socially
and economically most effective if they are based on relevant
scientific, technical and economic considerations and
continually re-evaluated in the light of new findings in
these areas''.
(10) Senate Resolution 98 of the One Hundred Fifth
Congress, which expressed that developing nations must also
be included in any future, binding climate change treaty and
such a treaty must not result in serious harm to the United
States economy, should not cause the United States to abandon
its shared responsibility to help reduce the risks of climate
change and its impacts. Future international efforts in this
regard should focus on recognizing the equitable
responsibilities for addressing climate change by all
nations, including commitments by the largest developing
country emitters in a future, binding climate change treaty.
(11) It is the position of the United States that it will
not interfere with the plans of any nation that chooses to
ratify and implement the Kyoto Protocol to the UNFCCC.
(12) American businesses need to know how governments
worldwide will address the risks of climate change.
(13) The United States benefits from investments in the
research, development and deployment of a range of clean
energy and efficiency technologies that can reduce the risks
of climate change and its impacts and that can make the
United States economy more productive, bolster energy
security, create jobs, and protect the environment.
(b) Sense of Congress.--It is the sense of the United
States Congress that the United States should demonstrate
international leadership and responsibility in reducing the
health, environmental, and economic risks posed by climate
change by--
(1) taking responsible action to ensure significant and
meaningful reductions in emissions of greenhouse gases from
all sectors;
(2) creating flexible international and domestic
mechanisms, including joint implementation, technology
deployment, tradable credits for emissions reductions and
carbon sequestration projects that will reduce, avoid, and
sequester greenhouse gas emissions; and
(3) participating in international negotiations, including
putting forth a proposal to the Conference of the Parties,
with the objective of securing United States participation in
a future binding climate change Treaty in a manner that is
consistent with the environmental objectives of the UNFCCC,
that protects the economic interests of the United States,
and recognizes the shared international responsibility for
addressing climate change, including developing country
participation.

[[Page S10782]]

Subtitle B--Climate Change Strategy

SEC. 1011. SHORT TITLE.

This subtitle may be cited as the ``Climate Change Strategy
and Technology Innovation Act of 2003''.

SEC. 1012. DEFINITIONS.

In this subtitle:
(1) Climate-friendly technology.--The term ``climate-
friendly technology'' means any energy supply or end-use
technology that, over the life of the technology and compared
to similar technology in commercial use as of the date of
enactment of this Act--
(A) results in reduced emissions of greenhouse gases;
(B) may substantially lower emissions of other pollutants;
and
(C) may generate substantially smaller or less hazardous
quantities of solid or liquid waste.
(2) Department.--The term ``Department'' means the
Department of Energy.
(3) Department office.--The term ``Department Office''
means the Office of Climate Change Technology of the
Department established by section 1015(a).
(4) Federal agency.--The term ``Federal agency'' has the
meaning given the term ``agency'' in section 551 of title 5,
United States Code.
(5) Greenhouse gas.--The term ``greenhouse gas'' means--
(A) an anthropogenic gaseous constituent of the atmosphere
(including carbon dioxide, methane, nitrous oxide,
chlorofluorocarbons, hydrofluorocarbons, perfluorocarbons,
sulfur hexafluoride, and tropospheric ozone) that absorbs and
re-emits infrared radiation and influences climate; and
(B) an anthropogenic aerosol (such as black soot) that
absorbs solar radiation and influences climate.
(6) Interagency task force.--The term ``Interagency Task
Force'' means the Interagency Task Force established under
section 1014(e).
(7) Key element.--The term ``key element'', with respect to
the Strategy, means--
(A) definition of interim emission mitigation levels, that,
coupled with specific mitigation approaches and after taking
into account actions by other nations (if any), would result
in stabilization of greenhouse gas concentrations;
(B) technology development, including--
(i) a national commitment to double energy research and
development by the United States public and private sectors;
and
(ii) in carrying out such research and development, a
national commitment to provide a high degree of emphasis on
bold, breakthrough technologies that will make possible a
profound transformation of the energy, transportation,
industrial, agricultural, and building sectors of the United
States;
(C) climate adaptation research that focuses on actions
necessary to adapt to climate change--
(i) that may have already occurred; or
(ii) that may occur under future climate change scenarios;
(D) climate science research that--
(i) builds on the substantial scientific understanding of
climate change that exists as of the date of enactment of
this subtitle; and
(ii) focuses on reducing the remaining scientific,
technical, and economic uncertainties to aid in the
development of sound response strategies.
(8) Long-term goal of the strategy.--The term ``long-term
goal of the Strategy'' means the long-term goal in section
1013(a)(1).
(9) Mitigation.--The term ``mitigation'' means actions that
reduce, avoid, or sequester greenhouse gases.
(10) National academy of sciences.--The term ``National
Academy of Sciences'' means the National Academy of Sciences,
the National Academy of Engineering, the Institute of
Medicine, and the National Research Council.
(11) Qualified individual.--
(A) In general.--The term ``qualified individual'' means an
individual who has demonstrated expertise and leadership
skills to draw on other experts in diverse fields of
knowledge that are relevant to addressing the climate change
challenge.
(B) Fields of knowledge.--The fields of knowledge referred
to in subparagraph (A) are--
(i) the science of climate change and its impacts;
(ii) energy and environmental economics;
(iii) technology transfer and diffusion;
(iv) the social dimensions of climate change;
(v) climate change adaptation strategies;
(vi) fossil, nuclear, and renewable energy technology;
(vii) energy efficiency and energy conservation;
(viii) energy systems integration;
(ix) engineered and terrestrial carbon sequestration;
(x) transportation, industrial, and building sector
concerns;
(xi) regulatory and market-based mechanisms for addressing
climate change;
(xii) risk and decision analysis;
(xiii) strategic planning; and
(xiv) the international implications of climate change
strategies.
(12) Secretary.--The term ``Secretary'' means the Secretary
of Energy.
(13) Stabilization of greenhouse gas concentrations.--The
term ``stabilization of greenhouse gas concentrations'' means
the stabilization of greenhouse gas concentrations in the
atmosphere at a level that would prevent dangerous
anthropogenic interference with the climate system,
recognizing that such a level should be achieved within a
time frame sufficient to allow ecosystems to adapt naturally
to climate change, to ensure that food production is not
threatened and to enable economic development to proceed in a
sustainable manner, as contemplated by the United Nations
Framework Convention on Climate Change, done at New York on
May 9, 1992.
(14) Strategy.--The term ``Strategy'' means the National
Climate Change Strategy developed under section 1013.
(15) White house office.--The term ``White House Office''
means the Office of National Climate Change Policy
established by section 1014(a).

SEC. 1013. NATIONAL CLIMATE CHANGE STRATEGY.

(a) In General.--The President, through the director of the
White House Office and in consultation with the Interagency
Task Force, shall develop a National Climate Change Strategy,
which shall--
(1) have the long-term goal of stabilization of greenhouse
gas concentrations through actions taken by the United States
and other nations;
(2) recognize that accomplishing the long-term goal of the
Strategy will take from many decades to more than a century,
but acknowledging that significant actions must begin in the
near term;
(3) incorporate the four key elements;
(4) be developed on the basis of an examination of a broad
range of emissions levels and dates for achievement of those
levels (including those evaluated by the Intergovernmental
Panel on Climate Change and those consistent with United
States treaty commitments) that, after taking into account
actions by other nations, would achieve the long-term goal of
the Strategy;
(5) consider the broad range of activities and actions that
can be taken by United States entities to reduce, avoid, or
sequester greenhouse gas emissions both within the United
States and in other nations through the use of market
mechanisms, which may include, but not be limited to,
mitigation activities, terrestrial sequestration, earning
offsets through carbon capture or project-based activities,
trading of emissions credits in domestic and international
markets, and the application of the resulting credits from
any of the above within the United States;
(6) minimize any adverse short-term and long-term social,
economic, national security, and environmental impacts,
including ensuring that the strategy is developed in an
economically and environmentally sound manner;
(7) incorporate mitigation approaches leading to the
development and deployment of advanced technologies and
practices that will reduce, avoid, or sequester greenhouse
gas emissions;
(8) be consistent with the goals of energy, transportation,
industrial, agricultural, forestry, environmental, economic,
and other relevant policies of the United States;
(9) take into account--
(A) the diversity of energy sources and technologies;
(B) supply-side and demand-side solutions; and
(C) national infrastructure, energy distribution, and
transportation systems;
(10) be based on an evaluation of a wide range of
approaches for achieving the long-term goal of the Strategy,
including evaluation of--
(A) a variety of cost-effective Federal and State policies,
programs, standards, and incentives;
(B) policies that integrate and promote innovative, market-
based solutions in the United States and in foreign
countries; and
(C) participation in other international institutions, or
in the support of international activities, that are
established or conducted to achieve the long-term goal of the
Strategy;
(11) in the final recommendations of the Strategy--
(A) emphasize policies and actions that achieve the long-
term goal of the Strategy; and
(B) provide specific recommendations concerning--
(i) measures determined to be appropriate for short-term
implementation, giving preference to cost-effective and
technologically feasible measures that will--

(I) produce measurable net reductions in United States
emissions, compared to expected trends, that lead toward
achievement of the long-term goal of the Strategy; and
(II) minimize any adverse short-term and long-term
economic, environmental, national security, and social
impacts on the United States;

(ii) the development of technologies that have the
potential for long-term implementation--

(I) giving preference to technologies that have the
potential to reduce significantly the overall cost of
achieving the long-term goal of the Strategy; and
(II) considering a full range of energy sources, energy
conversion and use technologies, and efficiency options;

(iii) such changes in institutional and technology systems
are necessary to adapt to climate change in the short-term
and the long-term;
(iv) such review, modification, and enhancement of the
scientific, technical, and economic research efforts of the
United States, and improvements to the data resulting from
research, as are appropriate to improve the accuracy of
predictions concerning climate change and the economic and
social costs and opportunities relating to climate change;
and
(v) changes that should be made to project and grant
evaluation criteria under other Federal research and
development programs so that those criteria do not inhibit
development of climate-friendly technologies;
(12) recognize that the Strategy is intended to guide the
Nation's effort to address climate change, but it shall not
create a legal obligation on the part of any person or entity
other than the duties of the Director of the White House
Office and Interagency Task Force in the development of the
Strategy;
(13) have a scope that considers the totality of United
States public, private, and public-private sector actions
that bear on the long-term goal;

[[Page S10783]]

(14) be developed in a manner that provides for meaningful
participation by, and consultation among, Federal, State,
tribal, and local government agencies, nongovernmental
organizations, academia, scientific bodies, industry, the
public, and other interested parties in accordance with
subsections (b)(3)(C)(iv)(II) and (e)(3)(B)(ii) of section
1014;
(15) address how the United States should engage State,
tribal, and local governments in developing and carrying out
a response to climate change;
(16) promote, to the maximum extent practicable, public
awareness, outreach, and information-sharing to further the
understanding of the full range of climate change-related
issues;
(17) provide a detailed explanation of how the measures
recommended by the Strategy will ensure that they do not
result in serious harm to the economy of the United States;
(18) provide a detailed explanation of how the measures
recommended by the Strategy will achieve its long-term goal;
(19) include any recommendations for legislative and
administrative actions necessary to implement the Strategy;
(20) serve as a framework for climate change actions by all
Federal agencies;
(21) recommend which Federal agencies are, or should be,
responsible for the various aspects of implementation of the
Strategy and any budgetary implications;
(22) address how the United States should engage foreign
governments in developing an international response to
climate change; and
(23) incorporate initiatives to open markets and promote
the deployment of a range of climate-friendly technologies
developed in the United States and abroad.
(b) Submission to Congress.--Not later than 1 year after
the date of enactment of this section, the President, through
the Interagency Task Force and the Director, shall submit to
Congress the Strategy, in the form of a report that
includes--
(1) a description of the Strategy and its goals, including
how the Strategy addresses each of the 4 key elements;
(2) an inventory and evaluation of Federal programs and
activities intended to carry out the Strategy;
(3) a description of how the Strategy will serve as a
framework of climate change response actions by all Federal
agencies, including a description of coordination mechanisms
and interagency activities;
(4) evidence that the Strategy is consistent with other
energy, transportation, industrial, agricultural, forestry,
environmental, economic, and other relevant policies of the
United States;
(5) a description of provisions in the Strategy that ensure
that it minimizes any adverse short-term and long-term
social, economic, national security, and environmental
impacts, including ensuring that the Strategy is developed in
an economically and environmentally sound manner;
(6) evidence that the Strategy has been developed in a
manner that provides for participation by, and consultation
among, Federal, State, tribal, and local government agencies,
nongovernmental organizations, academia, scientific bodies,
industry, the public, and other interested parties;
(7) a description of Federal activities that promote, to
the maximum extent practicable, public awareness, outreach,
and information-sharing to further the understanding of the
full range of climate change-related issues; and
(8) recommendations for legislative or administrative
changes to Federal programs or activities implemented to
carry out this Strategy, in light of new knowledge of climate
change and its impacts and costs or benefits, or
technological capacity to improve mitigation or adaption
activities.
(c) Updates.--Not later than 4 years after the date of
submission of the Strategy to Congress under subsection (b),
and at the end of each 4-year period thereafter, the
President shall submit to Congress an updated version of the
Strategy.
(d) Progress Reports.--Not later than 1 year after the date
of submission of the Strategy to Congress under subsection
(b), and annually thereafter at the time that the President
submits to the Congress the budget of the United States
Government under section 1105 of title 31, United States
Code, the President shall submit to Congress a report that--
(1) describes the Strategy, its goals, and the Federal
programs and activities intended to carry out the Strategy
through technological, scientific, mitigation, and adaptation
activities;
(2) evaluates the Federal programs and activities
implemented as part of this Strategy against the goals and
implementation dates outlined in the Strategy;
(3) assesses the progress in implementation of the
Strategy;
(4) incorporates the technology program reports required
pursuant to section 1015(a)(3) and subsections (d) and (e) of
section 1321;
(5) describes any changes to Federal programs or activities
implemented to carry out this Strategy, in light of new
knowledge of climate change and its impacts and costs or
benefits, or technological capacity to improve mitigation or
adaptation activities;
(6) describes all Federal spending on climate change for
the current fiscal year and each of the 5 years previous;
categorized by Federal agency and program function (including
scientific research, energy research and development,
regulation, education, and other activities);
(7) estimates the budgetary impact for the current fiscal
year and each of the 5 years previous of any Federal tax
credits, tax deductions or other incentives claimed by
taxpayers that are directly or indirectly attributable to
greenhouse gas emissions reduction activities;
(8) estimates the amount, in metric tons, of net greenhouse
gas emissions reduced, avoided, or sequestered directly or
indirectly as a result of the implementation of the Strategy;
(9) evaluates international research and development and
market-based activities and the mitigation actions taken by
the United States and other nations to achieve the long-term
goal of the Strategy; and
(10) makes recommendations for legislative or
administrative actions or adjustments that will accelerate
progress towards meeting the near-term and long-term goals
contained in the Strategy.
(e) National Academy of Sciences Review.--
(1) In general.--Not later than 90 days after the date of
publication of the Strategy under subsection (b) and each
update under subsection (c), the Director of the National
Science Foundation, on behalf of the Director of the White
House Office and the Interagency Task Force, shall enter into
appropriate arrangements with the National Academy of
Sciences to conduct a review of the Strategy or update.
(2) Criteria.--The review by the National Academy of
Sciences shall evaluate the goals and recommendations
contained in the Strategy or update, taking into
consideration--
(A) the adequacy of effort and the appropriateness of focus
of the totality of all public, private, and public-private
sector actions of the United States with respect to the
Strategy, including the four key elements;
(B) the adequacy of the budget and the effectiveness with
which each Federal agency is carrying out its
responsibilities;
(C) current scientific knowledge regarding climate change
and its impacts;
(D) current understanding of human social and economic
responses to climate change, and responses of natural
ecosystems to climate change;
(E) advancements in energy technologies that reduce, avoid,
or sequester greenhouse gases or otherwise mitigate the risks
of climate change;
(F) current understanding of economic costs and benefits of
mitigation or adaptation activities;
(G) the existence of alternative policy options that could
achieve the Strategy goals at lower economic, environmental,
or social cost; and
(H) international activities and the actions taken by the
United States and other nations to achieve the long-term goal
of the Strategy.
(3) Report.--Not later than 1 year after the date of
submittal to the Congress of the Strategy or update, as
appropriate, the National Academy of Sciences shall prepare
and submit to the Congress and the President a report
concerning the results of its review, along with any
recommendations as appropriate. Such report shall also be
made available to the public.
(4) Authorization of appropriations.--For the purposes of
this subsection, there are authorized to be appropriated to
the National Science Foundation such sums as may be
necessary.

SEC. 1014. OFFICE OF NATIONAL CLIMATE CHANGE POLICY.

(a) Establishment.--
(1) In general.--There is established, within the Executive
Office of the President, the Office of National Climate
Change Policy.
(2) Focus.--The White House Office shall have the focus of
achieving the long-term goal of the Strategy while minimizing
adverse short-term and long-term economic and social impacts.
(3) Duties.--Consistent with paragraph (2), the White House
Office shall--
(A) establish policies, objectives, and priorities for the
Strategy;
(B) in accordance with subsection (d), establish the
Interagency Task Force to serve as the primary mechanism
through which the heads of Federal agencies shall assist the
Director of the White House Office in developing and
implementing the Strategy;
(C) to the maximum extent practicable, ensure that the
Strategy is based on objective, quantitative analysis,
drawing on the analytical capabilities of Federal and State
agencies, especially the Department Office;
(D) advise the President concerning necessary changes in
organization, management, budgeting, and personnel allocation
of Federal agencies involved in climate change response
activities; and
(E) advise the President and notify a Federal agency if the
policies and discretionary programs of the agency are not
well aligned with, or are not contributing effectively to,
the long-term goal of the Strategy.
(b) Director of the White House Office.--
(1) In general.--The White House Office shall be headed by
a Director, who shall report directly to the President, and
shall consult with the appropriate economic, environmental,
national security, domestic policy, science and technology
and other offices with the Executive Office of the President.
(2) Appointment.--The Director of the White House Office
shall be a qualified individual appointed by the President,
by and with the advice and consent of the Senate.
(3) Duties of the director of the white house office.--
(A) Strategy.--In accordance with section 1013, the
Director of the White House Office shall coordinate the
development and updating of the Strategy.
(B) Interagency task force.--The Director of the White
House Office shall serve as Chair of the Interagency Task
Force.
(C) Advisory duties.--
(i) Energy, economic, environmental, transportation,
industrial, agricultural, building, forestry, and other
programs.--The Director of the White House Office, using an
integrated perspective considering the totality of actions in
the United States, shall advise the President and the heads
of Federal agencies on--

(I) the extent to which United States energy, economic,
environmental, transportation, industrial, agricultural,
forestry, building, and other

[[Page S10784]]

relevant programs are capable of producing progress on the
long-term goal of the Strategy; and
(II) the extent to which proposed or newly created energy,
economic, environmental, transportation, industrial,
agricultural, forestry, building, and other relevant programs
positively or negatively affect the ability of the United
States to achieve the long-term goal of the Strategy.

(ii) Tax, trade, and foreign policies.--The Director of the
White House Office, using an integrated perspective
considering the totality of actions in the United States,
shall advise the President and the heads of Federal agencies
on--

(I) the extent to which the United States tax policy, trade
policy, and foreign policy are capable of producing progress
on the long-term goal of the Strategy; and
(II) the extent to which proposed or newly created tax
policy, trade policy, and foreign policy positively or
negatively affect the ability of the United States to achieve
the long-term goal of the Strategy.

(iii) International treaties.--The Secretary of State,
acting in conjunction with the Interagency Task Force and
using the analytical tools available to the White House
Office, shall provide to the Director of the White House
Office an opinion that--

(I) specifies, to the maximum extent practicable, the
economic and environmental costs and benefits of any proposed
international treaties or components of treaties that have an
influence on greenhouse gas management; and
(II) assesses the extent to which the treaties advance the
long-term goal of the Strategy, while minimizing adverse
short-term and long-term economic and social impacts and
considering other impacts.

(iv) Consultation.--

(I) With members of interagency task force.--To the extent
practicable and appropriate, the Director of the White House
Office shall consult with all members of the Interagency Task
Force before providing advice to the President.
(II) With other interested parties.--The Director of the
White House Office shall establish a process for obtaining
the meaningful participation of Federal, State, tribal, and
local government agencies, nongovernmental organizations,
academia, scientific bodies, industry, the public, and other
interested parties in the development and updating of the
Strategy.

(D) Public education, awareness, outreach, and information-
sharing.--The Director of the White House Office, to the
maximum extent practicable, shall promote public awareness,
outreach, and information-sharing to further the
understanding of the full range of climate change-related
issues.
(4) Annual reports.--The Director of the White House
Office, in consultation with the Interagency Task Force and
other interested parties, shall prepare the annual reports
for submission by the President to Congress under section
1013(d).
(5) Analysis.--During development of the Strategy,
preparation of the annual reports submitted under paragraph
(4), and provision of advice to the President and the heads
of Federal agencies, the Director of the White House Office
shall place significant emphasis on the use of objective,
quantitative analysis, taking into consideration any
uncertainties associated with the analysis.
(c) Staff.--
(1) In general.--The Director of the White House Office
shall employ a professional staff, including the staff
appointed under paragraph (2), of not more than 25
individuals to carry out the duties of the White House
Office.
(2) Intergovernmental personnel and fellowships.--The
Director of the White House Office may use the authority
provided by the Intergovernmental Personnel Act of 1970 (42
U.S.C. 4701 et seq.) and subchapter VI of chapter 33 of title
5, United States Code, and fellowships, to obtain staff from
Federal agencies, academia, scientific bodies, or a National
Laboratory (as that term is defined in section 1203), for
appointments of a limited term.
(d) Authorization of Appropriations.--
(1) Use of available appropriations.--From funds made
available to Federal agencies for the fiscal year in which
this title is enacted, the President shall provide such sums
as are necessary to carry out the duties of the White House
Office under this title until the date on which funds are
made available under paragraph (2).
(2) Authorization of appropriations.--There is authorized
to be appropriated to the Executive Office of the President
to carry out the duties of the White House Office under this
subtitle, $5,000,000 for each of fiscal years 2003 through
2011, to remain available through September 30, 2011.
(e) Interagency Task Force.--
(1) In general.--The Director of the White House Office
shall establish the Interagency Task Force.
(2) Composition.--The Interagency Task Force shall be
composed of--
(A) the Director of the White House Office, who shall serve
as Chair;
(B) the Secretary of State;
(C) the Secretary of Energy;
(D) the Secretary of Commerce;
(E) the Secretary of Transportation;
(F) the Secretary of Agriculture;
(G) the Administrator of the Environmental Protection
Agency;
(H) the Chairman of the Council of Economic Advisers;
(I) the Chairman of the Council on Environmental Quality;
(J) the Director of the Office of Science and Technology
Policy;
(K) the Director of the Office of Management and Budget;
and
(L) the heads of such other Federal agencies as the
President considers appropriate.
(3) Strategy.--
(A) In general.--The Interagency Task Force shall serve as
the primary forum through which the Federal agencies
represented on the Interagency Task Force jointly assist the
Director of the White House Office in--
(i) developing and updating the Strategy; and
(ii) preparing annual reports under section 1013(d).
(B) Required elements.--In carrying out subparagraph (A),
the Interagency Task Force shall--
(i) take into account the long-term goal and other
requirements of the Strategy specified in section 1013(a);
(ii) consult with State, tribal, and local government
agencies, nongovernmental organizations, academia, scientific
bodies, industry, the public, and other interested parties;
and
(iii) build consensus around a Strategy that is based on
strong scientific, technical, and economic analyses.
(4) Working groups.--The Chair, in consultation with the
members of the Interagency Task Force, may establish such
topical working groups as are necessary to carry out the
duties of the Interagency Task Force and implement the
Strategy, taking into consideration the key elements of the
Strategy. Such working groups may be comprised of members of
the Interagency Task Force or their designees.
(f) Staff.--In accordance with procedures established by
the Chair of the Interagency Task Force, the Federal agencies
represented on the Interagency Task Force shall provide staff
from the agencies to support information, data collection,
and analyses required by the Interagency Task Force.
(g) Hearings.--Upon request of the Chair, the Interagency
Task Force may hold such hearings, meet and act at such times
and places, take such testimony, and receive such evidence as
the Interagency Task Force considers to be appropriate.

SEC. 1015. OFFICE OF CLIMATE CHANGE TECHNOLOGY.

(a) Establishment.--
(1) In general.--There is established, within the
Department, the Office of Climate Change Technology.
(2) Duties.--The Department Office shall--
(A) manage an energy technology research and development
program that directly supports the Strategy by--
(i) focusing on high-risk, bold, breakthrough technologies
that--

(I) have significant promise of contributing to the long-
term goal of the Strategy by--

(aa) mitigating the emissions of greenhouse gases;
(bb) removing and sequestering greenhouse gases from
emission streams; or
(cc) removing and sequestering greenhouse gases from the
atmosphere;

(II) are not being addressed significantly by other Federal
programs; and
(III) would represent a substantial advance beyond
technology available on the date of enactment of this
subtitle;

(ii) forging fundamentally new research and development
partnerships among various Department, other Federal, and
State programs, particularly between basic science and energy
technology programs, in cases in which such partnerships have
significant potential to affect the ability of the United
States to achieve the long-term goal of the Strategy at the
lowest possible cost;
(iii) forging international research and development
partnerships that are in the interests of the United States
and make progress on achieving the long-term goal of the
Strategy;
(iv) making available, through monitoring, experimentation,
and analysis, data that are essential to proving the
technical and economic viability of technology central to
addressing climate change; and
(v) transferring research and development programs to other
program offices of the Department once such a research and
development program crosses the threshold of high-risk
research and moves into the realm of more conventional
technology development;
(B) through active participation in the Interagency Task
Force and utilization of the analytical capabilities of the
Department Office, share analyses of alternative climate
change strategies with other agencies represented on the
Interagency Task Force to assist them in understanding--
(i) the scale of the climate change challenge; and
(ii) how actions of the Federal agencies on the Interagency
Task Force positively or negatively contribute to climate
change solutions;
(C) provide analytical support to the White House Office,
particularly in support of the development of the Strategy
and associated progress reporting;
(D) foster the development of tools, data, and capabilities
to ensure that--
(i) the United States has a robust capability for
evaluating alternative climate change response scenarios; and
(ii) the Department Office provides long-term analytical
continuity during the terms of service of successive
Presidents;
(E) identify the total contribution of all Department
programs to the Strategy; and
(F) advise the Secretary on all aspects of climate change-
related issues, including necessary changes in Department
organization, management, budgeting, and personnel allocation
in the programs involved in climate change response-related
activities.
(3) Annual reports.--The Department Office shall prepare an
annual report for submission by the Secretary to Congress and
the White House Office that--

[[Page S10785]]

(A) assesses progress toward meeting the goals of the
energy technology research and development program described
in this section;
(B) assesses the activities of the Department Office;
(C) assesses the contributions of all energy technology
research and development programs of the Department
(including science programs) to the long-term goal and other
requirements of the Strategy; and
(D) make recommendations for actions by the Department and
other Federal agencies to address the components of
technology development that are necessary to support the
Strategy.
(b) Director of the Department Office.--
(1) In general.--The Department Office shall be headed by a
Director, who shall be a qualified individual appointed by
the President, and who shall be compensated at a rate
provided for level IV of the Executive Schedule under section
5315 of title 5, United States Code.
(2) Reporting.--The Director of the Department Office shall
report directly to the Under Secretary for Energy and
Science.
(3) Vacancies.--A vacancy in the position of the Director
of the Department Office shall be filled in the same manner
as the original appointment was made.
(c) Intergovernmental Personnel.--The Department Office may
use the authority provided by the Intergovernmental Personnel
Act of 1970 (42 U.S.C. 4701 et seq.), subchapter VI of
chapter 33 of title 5, United States Code, and other
departmental personnel authorities, to obtain staff for
appointments of a limited term.
(d) Relationship to Other Department Programs.--Each
project carried out by the Department Office shall be--
(1) initiated only after consultation with one or more
other appropriate program offices of the Department that
support research and development in the areas relating to the
project;
(2) managed by the Department Office; and
(3) in the case of a project that reaches a sufficient
level of maturity, with the concurrence of the Department
Office and the appropriate office described in paragraph (1),
transferred to the appropriate office, along with the funds
necessary to continue the project to the point at which non-
Federal funding can provide substantial support for the
project.
(e) Collaboration and Cost Sharing.--
(1) With other federal agencies.--Projects supported by the
Department Office may include participation of, and be
supported by, other Federal agencies that have a role in the
development, commercialization, or transfer of energy,
transportation, industrial, agricultural, forestry, or other
climate change-related technology.
(2) With the private sector.--
(A) In general.--Notwithstanding section 1403, the
Department Office shall create an operating model that allows
for collaboration, division of effort, and cost sharing with
industry on individual climate change response projects.
(B) Requirements.--Although cost sharing in some cases may
be appropriate, the Department Office shall focus on long-
term high-risk research and development and should not make
industrial partnerships or cost sharing a requirement, if
such a requirement would bias the activities of the
Department Office toward incremental innovations.
(C) Reevaluation on transfer.--At such time as any bold,
breakthrough research and development program reaches a
sufficient level of technological maturity such that the
program is transferred to a program office of the Department
other than the Department Office, the cost-sharing
requirements and criteria applicable to the program shall be
reevaluated.
(D) Publication in federal register.--Each cost-sharing
agreement entered into under this paragraph shall be
published in the Federal Register.
(f) Analysis of Climate Change Strategy.--
(1) In general.--The Department Office shall foster the
development and application of advanced computational tools,
data, and capabilities that, together with the capabilities
of other Federal agencies, support integrated assessment of
alternative climate change response scenarios and
implementation of the Strategy.
(2) Programs.--
(A) In general.--The Department Office shall--
(i) develop and maintain core analytical competencies and
complex, integrated computational modeling capabilities that,
together with the capabilities of other Federal agencies, are
necessary to support the design and implementation of the
Strategy; and
(ii) track United States and international progress toward
the long-term goal of the Strategy.
(B) International carbon dioxide sequestration monitoring
and data program.--In consultation with Federal, State,
academic, scientific, private sector, nongovernmental,
tribal, and international carbon capture and sequestration
technology programs, the Department Office shall design and
carry out an international carbon dioxide sequestration
monitoring and data program to collect, analyze, and make
available the technical and economic data to ascertain--
(i) whether engineered sequestration and terrestrial
sequestration will be acceptable technologies from
regulatory, economic, and international perspectives;
(ii) whether carbon dioxide sequestered in geological
formations or ocean systems is stable and has inconsequential
leakage rates on a geologic time-scale; and
(iii) the extent to which forest, agricultural, and other
terrestrial systems are suitable carbon sinks.
(3) Areas of expertise.--
(A) In general.--The Department Office shall develop and
maintain expertise in integrated assessment, modeling, and
related capabilities necessary--
(i) to understand the relationship between natural,
agricultural, industrial, energy, and economic systems;
(ii) to design effective research and development programs;
and
(iii) to assist with the development and implementation of
the Strategy.
(B) Technology transfer and diffusion.--The expertise
described in clause (i) shall include knowledge of technology
transfer and technology diffusion in United States and
foreign markets.
(4) Dissemination of information.--The Department Office
shall ensure, to the maximum extent practicable, that
technical and scientific knowledge relating to greenhouse gas
emission reduction, avoidance, and sequestration is broadly
disseminated through publications, fellowships, and training
programs.
(5) Assessments.--In a manner consistent with the Strategy,
the Department shall conduct assessments of deployment of
climate-friendly technology.
(6) Analysis.--During development of the Strategy, annual
reports submitted under subsection (a)(3), and advice to the
Secretary, the Director of the Department Office shall place
significant emphasis on the use of objective, quantitative
analysis, taking into consideration any associated
uncertainties.
(g) Authorization of Appropriations.--
(1) Use of available appropriations.--From funds made
available to Federal agencies for the fiscal year in which
this subtitle is enacted, the President shall provide such
sums as are necessary to carry out the duties of the
Department Office under this subtitle until the date on which
funds are made available under paragraph (2).
(2) Authorization of appropriations.--There is authorized
to be appropriated to the Secretary, to carry out the duties
of the Department Office under this subtitle, $4,750,000,000
for the period of fiscal years 2003 through 2011, to remain
available through September 30, 2011.
(3) Additonal amounts.--Amounts authorized to be
appropriated under this section shall be in addition to--
(A) amounts made available to carry out the United States
Global Change Research Program under the Global Change
Research Act of 1990 (15 U.S.C. 2921 et seq.); and
(B) amounts made available under other provisions of law
for energy research and development.

SEC. 1016. ADDITIONAL OFFICES AND ACTIVITIES.

The Secretary of Agriculture, the Secretary of
Transportation, the Secretary of Commerce, the Administrator
of the Environmental Protection Agency, and the heads of
other Federal agencies may establish such offices and carry
out such activities, in addition to those established or
authorized by this Act, as are necessary to carry out this
Act.

Subtitle C--Science and Technology Policy

SEC. 1021. GLOBAL CLIMATE CHANGE IN THE OFFICE OF SCIENCE AND
TECHNOLOGY POLICY.

Section 101(b) of the National Science and Technology
Policy, Organization, and Priorities Act of 1976 (42 U.S.C.
6601(b)) is amended--
(1) by redesignating paragraphs (7) through (13) as
paragraphs (8) through (14), respectively; and
(2) by inserting after paragraph (6) the following:
``(7) improving efforts to understand, assess, predict,
mitigate, and respond to global climate change;''.

SEC. 1022. DIRECTOR OF OFFICE OF SCIENCE AND TECHNOLOGY
POLICY FUNCTIONS.

(a) Advise President on Global Climate Change.--Section
204(b)(1) of the National Science and Technology Policy,
Organization, and Priorities Act of 1976 (42 U.S.C.
6613(b)(1)) is amended by inserting ``global climate
change,'' after ``to,''.
(b) Advise Director of Office of National Climate Change
Policy.--Section 207 of that Act (42 U.S.C. 6616) is
amended--
(1) by redesignating subsections (b) and (c) as subsections
(c) and (d), respectively; and
(2) by inserting after subsection (a) the following:
``(b) Advise Director of Office of National Climate Change
Policy.--In carrying out this Act, the Director shall advise
the Director of the Office of National Climate Change Policy
on matters concerning science and technology as they relate
to global climate change.''.

Subtitle D--Miscellaneous Provisions

SEC. 1031. ADDITIONAL INFORMATION FOR REGULATORY REVIEW.

In each case that an agency prepares and submits a
Statement of Energy Effects pursuant to Executive Order 13211
of May 18, 2001 (relating to actions concerning regulations
that significantly affect energy supply, distribution, or
use), the agency shall also submit an estimate of the change
in net annual greenhouse gas emissions resulting from the
proposed significant energy action and any reasonable
alternatives to the action.

SEC. 1032. GREENHOUSE GAS EMISSIONS FROM FEDERAL FACILITIES.

(a) Methodology.--Not later than 1 year after the date of
enactment of this section, the Secretary of Energy, Secretary
of Agriculture, Secretary of Commerce, and Administrator of
the Environmental Protection Agency shall publish a jointly
developed methodology for preparing estimates of annual net
greenhouse gas emissions from all federally owned, leased, or
operated facilities and emission sources, including
stationary, mobile, and indirect emissions as may be
determined to be feasible.
(b) Publication.--Not later than 18 months after the date
of enactment of this section, and annually thereafter, the
Secretary of Energy shall publish an estimate of annual net
greenhouse gas emissions from all federally owned,

[[Page S10786]]

leased, or operated facilities and emission sources, using
the methodology published under subsection (a).

TITLE XI--NATIONAL GREENHOUSE GAS DATABASE

SEC. 1101. PURPOSE.

The purpose of this title is to establish a greenhouse gas
inventory, reductions registry, and information system that--
(1) are complete, consistent, transparent, and accurate;
(2) will create reliable and accurate data that can be used
by public and private entities to design efficient and
effective greenhouse gas emission reduction strategies; and
(3) will acknowledge and encourage greenhouse gas emission
reductions.

SEC. 1102. DEFINITIONS.

In this title:
(1) Administrator.--The term ``Administrator'' means the
Administrator of the Environmental Protection Agency.
(2) Baseline.--The term ``baseline'' means the historic
greenhouse gas emission levels of an entity, as adjusted
upward by the designated agency to reflect actual reductions
that are verified in accordance with--
(A) regulations promulgated under section 1104(c)(1); and
(B) relevant standards and methods developed under this
title.
(3) Database.--The term ``database'' means the National
Greenhouse Gas Database established under section 1104.
(4) Designated agency.--The term ``designated agency''
means a department or agency to which responsibility for a
function or program is assigned under the memorandum of
agreement entered into under section 1103(a).
(5) Direct emissions.--The term ``direct emissions'' means
greenhouse gas emissions by an entity from a facility that is
owned or controlled by that entity.
(6) Entity.--The term ``entity'' means--
(A) a person located in the United States; or
(B) a public or private entity, to the extent that the
entity operates in the United States.
(7) Facility.--The term ``facility'' means--
(A) all buildings, structures, or installations located on
any 1 or more contiguous or adjacent properties of an entity
in the United States; and
(B) a fleet of 20 or more motor vehicles under the common
control of an entity.
(8) Greenhouse gas.--The term ``greenhouse gas'' means--
(A) carbon dioxide;
(B) methane;
(C) nitrous oxide;
(D) hydrofluorocarbons;
(E) perfluorocarbons;
(F) sulfur hexafluoride; and
(G) any other anthropogenic climate-forcing emissions with
significant ascertainable global warming potential, as--
(i) recommended by the National Academy of Sciences under
section 1107(b)(3); and
(ii) determined in regulations promulgated under section
1104(c)(1) (or revisions to the regulations) to be
appropriate and practicable for coverage under this title.
(9) Indirect emissions.--The term ``indirect emissions''
means greenhouse gas emissions that--
(A) are a result of the activities of an entity; but
(B)(i) are emitted from a facility owned or controlled by
another entity; and
(ii) are not reported as direct emissions by the entity the
activities of which resulted in the emissions.
(10) Registry.--The term ``registry'' means the registry of
greenhouse gas emission reductions established as a component
of the database under section 1104(b)(2).
(11) Sequestration.--
(A) In general.--The term ``sequestration'' means the
capture, long-term separation, isolation, or removal of
greenhouse gases from the atmosphere.
(B) Inclusions.--The term ``sequestration'' includes--
(i) soil carbon sequestration;
(ii) agricultural and conservation practices;
(iii) reforestation;
(iv) forest preservation;
(v) maintenance of an underground reservoir; and
(vi) any other appropriate biological or geological method
of capture, isolation, or removal of greenhouse gases from
the atmosphere, as determined by the Administrator.

SEC. 1103. ESTABLISHMENT OF MEMORANDUM OF AGREEMENT.

(a) In General.--Not later than 1 year after the date of
enactment of this Act, the President, acting through the
Director of the Office of National Climate Change Policy,
shall direct the Secretary of Energy, the Secretary of
Commerce, the Secretary of Agriculture, the Secretary of
Transportation, and the Administrator to enter into a
memorandum of agreement under which those heads of Federal
agencies will--
(1) recognize and maintain statutory and regulatory
authorities, functions, and programs that--
(A) are established as of the date of enactment of this Act
under other law;
(B) provide for the collection of data relating to
greenhouse gas emissions and effects; and
(C) are necessary for the operation of the database;
(2)(A) distribute additional responsibilities and
activities identified under this title to Federal departments
or agencies in accordance with the missions and expertise of
those departments and agencies; and
(B) maximize the use of available resources of those
departments and agencies; and
(3) provide for the comprehensive collection and analysis
of data on greenhouse gas emissions relating to product use
(including the use of fossil fuels and energy-consuming
appliances and vehicles).
(b) Minimum Requirements.--The memorandum of agreement
entered into under subsection (a) shall, at a minimum, retain
the following functions for the designated agencies:
(1) Department of energy.--The Secretary of Energy shall be
primarily responsible for developing, maintaining, and
verifying the registry and the emission reductions reported
under section 1605(b) of the Energy Policy Act of 1992 (42
U.S.C. 13385(b)).
(2) Department of commerce.--The Secretary of Commerce
shall be primarily responsible for the development of--
(A) measurement standards for the monitoring of emissions;
and
(B) verification technologies and methods to ensure the
maintenance of a consistent and technically accurate record
of emissions, emission reductions, and atmospheric
concentrations of greenhouse gases for the database.
(3) Environmental protection agency.--The Administrator
shall be primarily responsible for--
(A) emissions monitoring, measurement, verification, and
data collection under this title and title IV (relating to
acid deposition control) and title VIII of the Clean Air Act
(42 U.S.C. 7651 et seq.), including mobile source emissions
information from implementation of the corporate average fuel
economy program under chapter 329 of title 49, United States
Code; and
(B) responsibilities of the Environmental Protection Agency
relating to completion of the national inventory for
compliance with the United Nations Framework Convention on
Climate Change, done at New York on May 9, 1992.
(4) Department of agriculture.--The Secretary of
Agriculture shall be primarily responsible for--
(A) developing measurement techniques for--
(i) soil carbon sequestration; and
(ii) forest preservation and reforestation activities; and
(B) providing technical advice relating to biological
carbon sequestration measurement and verification standards
for measuring greenhouse gas emission reductions or offsets.
(c) Draft Memorandum of Agreement.--Not later than 15
months after the date of enactment of this Act, the
President, acting through the Director of the Office of
National Climate Change Policy, shall publish in the Federal
Register, and solicit comments on, a draft version of the
memorandum of agreement described in subsection (a).
(d) No Judicial Review.--The final version of the
memorandum of agreement shall not be subject to judicial
review.

SEC. 1104. NATIONAL GREENHOUSE GAS DATABASE.

(a) Establishment.--As soon as practicable after the date
of enactment of this Act, the designated agencies, in
consultation with the private sector and nongovernmental
organizations, shall jointly establish, operate, and maintain
a database, to be known as the ``National Greenhouse Gas
Database'', to collect, verify, and analyze information on
greenhouse gas emissions by entities.
(b) National Greenhouse Gas Database Components.--The
database shall consist of--
(1) an inventory of greenhouse gas emissions; and
(2) a registry of greenhouse gas emission reductions.
(c) Comprehensive System.--
(1) In general.--Not later than 2 years after the date of
enactment of this Act, the designated agencies shall jointly
promulgate regulations to implement a comprehensive system
for greenhouse gas emissions reporting, inventorying, and
reductions registration.
(2) Requirements.--The designated agencies shall ensure, to
the maximum extent practicable, that--
(A) the comprehensive system described in paragraph (1) is
designed to--
(i) maximize completeness, transparency, and accuracy of
information reported; and
(ii) minimize costs incurred by entities in measuring and
reporting greenhouse gas emissions; and
(B) the regulations promulgated under paragraph (1)
establish procedures and protocols necessary--
(i) to prevent the reporting of some or all of the same
greenhouse gas emissions or emission reductions by more than
1 reporting entity;
(ii) to provide for corrections to errors in data submitted
to the database;
(iii) to provide for adjustment to data by reporting
entities that have had a significant organizational change
(including mergers, acquisitions, and divestiture), in order
to maintain comparability among data in the database over
time;
(iv) to provide for adjustments to reflect new technologies
or methods for measuring or calculating greenhouse gas
emissions; and
(v) to account for changes in registration of ownership of
emission reductions resulting from a voluntary private
transaction between reporting entities.
(3) Baseline identification and protection.--Through
regulations promulgated under paragraph (1), the designated
agencies shall develop and implement a system that provides--
(A) for the provision of unique serial numbers to identify
the verified emission reductions made by an entity relative
to the baseline of the entity;
(B) for the tracking of the reductions associated with the
serial numbers; and
(C) that the reductions may be applied, as determined to be
appropriate by any Act of Congress enacted after the date of
enactment of this Act, toward a Federal requirement under
such an Act that is imposed on the entity for the purpose of
reducing greenhouse gas emissions.

[[Page S10787]]

SEC. 1105. GREENHOUSE GAS REDUCTION REPORTING.

(a) In General.--An entity that participates in the
registry shall meet the requirements described in subsection
(b).
(b) Requirements.--
(1) In general.--The requirements referred to in subsection
(a) are that an entity (other than an entity described in
paragraph (2)) shall--
(A) establish a baseline (including all of the entity's
greenhouse gas emissions on an entity-wide basis); and
(B) submit the report described in subsection (c)(1).
(2) Requirements applicable to entities entering into
certain agreements.--An entity that enters into an agreement
with a participant in the registry for the purpose of a
carbon sequestration project shall not be required to comply
with the requirements specified in paragraph (1) unless that
entity is required to comply with the requirements by reason
of an activity other than the agreement.
(c) Reports.--
(1) Required report.--Not later than April 1 of the third
calendar year that begins after the date of enactment of this
Act, and not later than April 1 of each calendar year
thereafter, subject to paragraph (3), an entity described in
subsection (a) shall submit to each appropriate designated
agency a report that describes, for the preceding calendar
year, the entity-wide greenhouse gas emissions (as reported
at the facility level), including--
(A) the total quantity of each greenhouse gas emitted,
expressed in terms of mass and in terms of the quantity of
carbon dioxide equivalent;
(B) an estimate of the greenhouse gas emissions from fossil
fuel combusted by products manufactured and sold by the
entity in the previous calendar year, determined over the
average lifetime of those products; and
(C) such other categories of emissions as the designated
agency determines in the regulations promulgated under
section 1104(c)(1) may be practicable and useful for the
purposes of this title, such as--
(i) direct emissions from stationary sources;
(ii) indirect emissions from imported electricity, heat,
and steam;
(iii) process and fugitive emissions; and
(iv) production or importation of greenhouse gases.
(2) Voluntary reporting.--An entity described in subsection
(a) may (along with establishing a baseline and reporting
reductions under this section)--
(A) submit a report described in paragraph (1) before the
date specified in that paragraph for the purposes of
achieving and commoditizing greenhouse gas reductions through
use of the registry; and
(B) submit to any designated agency, for inclusion in the
registry, information that has been verified in accordance
with regulations promulgated under section 1104(c)(1) and
that relates to--
(i) with respect to the calendar year preceding the
calendar year in which the information is submitted, and with
respect to any greenhouse gas emitted by the entity--

(I) project reductions from facilities owned or controlled
by the reporting entity in the United States;
(II) transfers of project reductions to and from any other
entity;
(III) project reductions and transfers of project
reductions outside the United States;
(IV) other indirect emissions that are not required to be
reported under paragraph (1); and
(V) product use phase emissions;

(ii) with respect to greenhouse gas emission reductions
activities of the entity that have been carried out during or
after 1990, verified in accordance with regulations
promulgated under section 1104(c)(1), and submitted to 1 or
more designated agencies before the date that is 4 years
after the date of enactment of this Act, any greenhouse gas
emission reductions that have been reported or submitted by
an entity under--

(I) section 1605(b) of the Energy Policy Act of 1992 (42
U.S.C. 13385(b)); or
(II) any other Federal or State voluntary greenhouse gas
reduction program; and

(iii) any project or activity for the reduction of
greenhouse gas emissions or sequestration of a greenhouse gas
that is carried out by the entity, including a project or
activity relating to--

(I) fuel switching;
(II) energy efficiency improvements;
(III) use of renewable energy;
(IV) use of combined heat and power systems;
(V) management of cropland, grassland, or grazing land;
(VI) a forestry activity that increases forest carbon
stocks or reduces forest carbon emissions;
(VII) carbon capture and storage;
(VIII) methane recovery;
(IX) greenhouse gas offset investment; and
(X) any other practice for achieving greenhouse gas
reductions as recognized by 1 or more designated agencies.

(3) Exemptions from reporting.--
(A) In general.--If the Director of the Office of National
Climate Change Policy determines under section 1108(b) that
the reporting requirements under paragraph (1) shall apply to
all entities (other than entities exempted by this
paragraph), regardless of participation or nonparticipation
in the registry, an entity shall be required to submit
reports under paragraph (1) only if, in any calendar year
after the date of enactment of this Act--
(i) the total greenhouse gas emissions of at least 1
facility owned by the entity exceeds 10,000 metric tons of
carbon dioxide equivalent (or such greater quantity as may be
established by a designated agency by regulation); or
(ii)(I) the total quantity of greenhouse gases produced,
distributed, or imported by the entity exceeds 10,000 metric
tons of carbon dioxide equivalent (or such greater quantity
as may be established by a designated agency by regulation);
and
(II) the entity is not a feedlot or other farming operation
(as defined in section 101 of title 11, United States Code).
(B) Entities already reporting.--
(i) In general.--An entity that, as of the date of
enactment of this Act, is required to report carbon dioxide
emissions data to a Federal agency shall not be required to
re-report that data for the purposes of this title.
(ii) Review of participation.--For the purpose of section
1108, emissions reported under clause (i) shall be considered
to be reported by the entity to the registry.
(4) Provision of verification information by reporting
entities.--Each entity that submits a report under this
subsection shall provide information sufficient for each
designated agency to which the report is submitted to verify,
in accordance with measurement and verification methods and
standards developed under section 1106, that the greenhouse
gas report of the reporting entity--
(A) has been accurately reported; and
(B) in the case of each voluntary report under paragraph
(2), represents--
(i) actual reductions in direct greenhouse gas emissions--

(I) relative to historic emission levels of the entity; and
(II) net of any increases in--

(aa) direct emissions; and
(bb) indirect emissions described in paragraph (1)(C)(ii);
or
(ii) actual increases in net sequestration.
(5) Failure to submit report.--An entity that participates
or has participated in the registry and that fails to submit
a report required under this subsection shall be prohibited
from including emission reductions reported to the registry
in the calculation of the baseline of the entity in future
years.
(6) Independent third-party verification.--To meet the
requirements of this section and section 1106, a entity that
is required to submit a report under this section may--
(A) obtain independent third-party verification; and
(B) present the results of the third-party verification to
each appropriate designated agency.
(7) Availability of data.--
(A) In general.--The designated agencies shall ensure, to
the maximum extent practicable, that information in the
database is--
(i) published;
(ii) accessible to the public; and
(iii) made available in electronic format on the Internet.
(B) Exception.--Subparagraph (A) shall not apply in any
case in which the designated agencies determine that
publishing or otherwise making available information
described in that subparagraph poses a risk to national
security.
(8) Data infrastructure.--The designated agencies shall
ensure, to the maximum extent practicable, that the database
uses, and is integrated with, Federal, State, and regional
greenhouse gas data collection and reporting systems in
effect as of the date of enactment of this Act.
(9) Additional issues to be considered.--In promulgating
the regulations under section 1104(c)(1) and implementing the
database, the designated agencies shall take into
consideration a broad range of issues involved in
establishing an effective database, including--
(A) the appropriate units for reporting each greenhouse
gas;
(B) the data and information systems and measures necessary
to identify, track, and verify greenhouse gas emission
reductions in a manner that will encourage the development of
private sector trading and exchanges;
(C) the greenhouse gas reduction and sequestration methods
and standards applied in other countries, as applicable or
relevant;
(D) the extent to which available fossil fuels, greenhouse
gas emissions, and greenhouse gas production and importation
data are adequate to implement the database;
(E) the differences in, and potential uniqueness of, the
facilities, operations, and business and other relevant
practices of persons and entities in the private and public
sectors that may be expected to participate in the registry;
and
(F) the need of the registry to maintain valid and reliable
information on baselines of entities so that, in the event of
any future action by Congress to require entities,
individually or collectively, to reduce greenhouse gas
emissions, Congress will be able--
(i) to take into account that information; and
(ii) to avoid enacting legislation that penalizes entities
for achieving and reporting reductions.
(d) Annual Report.--The designated agencies shall jointly
publish an annual report that--
(1) describes the total greenhouse gas emissions and
emission reductions reported to the database during the year
covered by the report;
(2) provides entity-by-entity and sector-by-sector analyses
of the emissions and emission reductions reported;
(3) describes the atmospheric concentrations of greenhouse
gases; and
(4) provides a comparison of current and past atmospheric
concentrations of greenhouse gases.

SEC. 1106. MEASUREMENT AND VERIFICATION.

(a) Standards.--
(1) In general.--Not later than 1 year after the date of
enactment of this Act, the designated agencies shall jointly
develop comprehensive measurement and verification methods
and standards to ensure a consistent and technically accurate
record of greenhouse gas emissions, emission reductions,
sequestration, and atmospheric concentrations for use in the
registry.
(2) Requirements.--The methods and standards developed
under paragraph (1) shall address the need for--

[[Page S10788]]

(A) standardized measurement and verification practices for
reports made by all entities participating in the registry,
taking into account--
(i) protocols and standards in use by entities desiring to
participate in the registry as of the date of development of
the methods and standards under paragraph (1);
(ii) boundary issues, such as leakage and shifted use;
(iii) avoidance of double counting of greenhouse gas
emissions and emission reductions; and
(iv) such other factors as the designated agencies
determine to be appropriate;
(B) measurement and verification of actions taken to
reduce, avoid, or sequester greenhouse gas emissions;
(C) in coordination with the Secretary of Agriculture,
measurement of the results of the use of carbon sequestration
and carbon recapture technologies, including--
(i) organic soil carbon sequestration practices; and
(ii) forest preservation and reforestation activities that
adequately address the issues of permanence, leakage, and
verification;
(D) such other measurement and verification standards as
the Secretary of Commerce, the Secretary of Agriculture, the
Administrator, and the Secretary of Energy determine to be
appropriate; and
(E) other factors that, as determined by the designated
agencies, will allow entities to adequately establish a fair
and reliable measurement and reporting system.
(b) Review and Revision.--The designated agencies shall
periodically review, and revise as necessary, the methods and
standards developed under subsection (a).
(c) Public Participation.--The Secretary of Commerce
shall--
(1) make available to the public for comment, in draft form
and for a period of at least 90 days, the methods and
standards developed under subsection (a); and
(2) after the 90-day period referred to in paragraph (1),
in coordination with the Secretary of Energy, the Secretary
of Agriculture, and the Administrator, adopt the methods and
standards developed under subsection (a) for use in
implementing the database.
(d) Experts and Consultants.--
(1) In general.--The designated agencies may obtain the
services of experts and consultants in the private and
nonprofit sectors in accordance with section 3109 of title 5,
United States Code, in the areas of greenhouse gas
measurement, certification, and emission trading.
(2) Available arrangements.--In obtaining any service
described in paragraph (1), the designated agencies may use
any available grant, contract, cooperative agreement, or
other arrangement authorized by law.

SEC. 1107. INDEPENDENT REVIEWS.

(a) In General.--Not later than 5 years after the date of
enactment of this Act, and every 3 years thereafter, the
Comptroller General of the United States shall submit to
Congress a report that--
(1) describes the efficacy of the implementation and
operation of the database; and
(2) includes any recommendations for improvements to this
title and programs carried out under this title--
(A) to achieve a consistent and technically accurate record
of greenhouse gas emissions, emission reductions, and
atmospheric concentrations; and
(B) to achieve the purposes of this title.
(b) Review of Scientific Methods.--The designated agencies
shall enter into an agreement with the National Academy of
Sciences under which the National Academy of Sciences shall--
(1) review the scientific methods, assumptions, and
standards used by the designated agencies in implementing
this title;
(2) not later than 4 years after the date of enactment of
this Act, submit to Congress a report that describes any
recommendations for improving--
(A) those methods and standards; and
(B) related elements of the programs, and structure of the
database, established by this title; and
(3) regularly review and update as appropriate the list of
anthropogenic climate-forcing emissions with significant
global warming potential described in section 1102(8)(G).

SEC. 1108. REVIEW OF PARTICIPATION.

(a) In General.--Not later than 5 years after the date of
enactment of this Act, the Director of the Office of National
Climate Change Policy shall determine whether the reports
submitted to the registry under section 1105(c)(1) represent
less than 60 percent of the national aggregate anthropogenic
greenhouse gas emissions.
(b) Increased Applicability of Requirements.--If the
Director of the Office of National Climate Change Policy
determines under subsection (a) that less than 60 percent of
the aggregate national anthropogenic greenhouse gas emissions
are being reported to the registry--
(1) the reporting requirements under section 1105(c)(1)
shall apply to all entities (except entities exempted under
section 1105(c)(3)), regardless of any participation or
nonparticipation by the entities in the registry; and
(2) each entity shall submit a report described in section
1105(c)(1)--
(A) not later than the earlier of--
(i) April 30 of the calendar year immediately following the
year in which the Director of the Office of National Climate
Change Policy makes the determination under subsection (a);
or
(ii) the date that is 1 year after the date on which the
Director of the Office of National Climate Change Policy
makes the determination under subsection (a); and
(B) annually thereafter.
(c) Resolution of Disapproval.--For the purposes of this
section, the determination of the Director of the Office of
National Climate Change Policy under subsection (a) shall be
considered to be a major rule (as defined in section 804(2)
of title 5, United States Code) subject to the congressional
disapproval procedure under section 802 of title 5, United
States Code.

SEC. 1109. ENFORCEMENT.

If an entity that is required to report greenhouse gas
emissions under section 1105(c)(1) or 1108 fails to comply
with that requirement, the Attorney General may, at the
request of the designated agencies, bring a civil action in
United States district court against the entity to impose on
the entity a civil penalty of not more than $25,000 for each
day for which the entity fails to comply with that
requirement.

SEC. 1110. REPORT ON STATUTORY CHANGES AND HARMONIZATION.

Not later than 3 years after the date of enactment of this
Act, the President shall submit to Congress a report that
describes any modifications to this title or any other
provision of law that are necessary to improve the accuracy
or operation of the database and related programs under this
title.

SEC. 1111. AUTHORIZATION OF APPROPRIATIONS.

There are authorized to be appropriated such sums as are
necessary to carry out this title.

DIVISION E--ENHANCING RESEARCH, DEVELOPMENT, AND TRAINING

TITLE XII--ENERGY RESEARCH AND DEVELOPMENT PROGRAMS

SEC. 1201. SHORT TITLE.

This division may be cited as the ``Energy Science and
Technology Enhancement Act of 2003''.

SEC. 1202. FINDINGS.

The Congress finds the following:
(1) A coherent national energy strategy requires an energy
research and development program that supports basic energy
research and provides mechanisms to develop, demonstrate, and
deploy new energy technologies in partnership with industry.
(2) An aggressive national energy research, development,
demonstration, and technology deployment program is an
integral part of a national climate change strategy, because
it can reduce--
(A) United States energy intensity by 1.9 percent per year
from 1999 to 2020;
(B) United States energy consumption in 2020 by 8
quadrillion Btu from otherwise expected levels; and
(C) United States carbon dioxide emissions from expected
levels by 166 million metric tons in carbon equivalent in
2020.
(3) An aggressive national energy research, development,
demonstration, and technology deployment program can help
maintain domestic United States production of energy,
increase United States hydrocarbon reserves by 14 percent,
and lower natural gas prices by 20 percent, compared to
estimates for 2020.
(4) An aggressive national energy research, development,
demonstration, and technology deployment program is needed if
United States suppliers and manufacturers are to compete in
future markets for advanced energy technologies.

SEC. 1203. DEFINITIONS.

In this title:
(1) Department.--The term ``Department'' means the
Department of Energy.
(2) Departmental mission.--The term ``departmental
mission'' means any of the functions vested in the Secretary
of Energy by the Department of Energy Organization Act (42
U.S.C. 7101 et seq.) or other law.
(3) Institution of higher education.--The term
``institution of higher education'' has the meaning given
that term in section 1201(a) of the Higher Education Act of
1965 (20 U.S.C. 1141(a));
(4) National laboratory.--The term ``National Laboratory''
means any of the following multipurpose laboratories owned by
the Department of Energy--
(A) Argonne National Laboratory;
(B) Brookhaven National Laboratory;
(C) Idaho National Engineering and Environmental
Laboratory;
(D) Lawrence Berkeley National Laboratory;
(E) Lawrence Livermore National Laboratory;
(F) Los Alamos National Laboratory;
(G) National Energy Technology Laboratory;
(H) National Renewable Energy Laboratory;
(I) Oak Ridge National Laboratory;
(J) Pacific Northwest National Laboratory; or
(K) Sandia National Laboratory.
(5) Secretary.--The term ``Secretary'' means the Secretary
of Energy.
(6) Technology deployment.--The term ``technology
deployment'' means activities to promote acceptance and
utilization of technologies in commercial application,
including activities undertaken pursuant to section 7 of the
Federal Nonnuclear Energy Research and Development Act of
1974 (42 U.S.C. 5906) or section 6 of the Renewable Energy
and Energy Efficiency Technology Competitiveness Act of 1989
(42 U.S.C. 12007).

SEC. 1204. CONSTRUCTION WITH OTHER LAWS.

Except as otherwise provided in this title and title XIV,
the Secretary shall carry out the research, development,
demonstration, and technology deployment programs authorized
by this title in accordance with the Atomic Energy Act of
1954 (42 U.S.C. 2011 et seq.), the Federal Nonnuclear
Research and Development Act of 1974 (42 U.S.C. 5901 et
seq.), the Energy Policy Act of 1992 (42 U.S.C. 13201 et
seq.), or any other Act under which the Secretary is
authorized to carry out such activities.

Subtitle A--Energy Efficiency

SEC. 1211. ENHANCED ENERGY EFFICIENCY RESEARCH AND
DEVELOPMENT.

(a) Program Direction.--The Secretary shall conduct
balanced energy research, development,

[[Page S10789]]

demonstration, and technology deployment programs to enhance
energy efficiency in buildings, industry, power technologies,
and transportation.
(b) Program Goals.--
(1) Energy-efficient housing.--The goal of the energy-
efficient housing program shall be to develop, in partnership
with industry, enabling technologies (including lighting
technologies), designs, production methods, and supporting
activities that will, by 2010--
(A) cut the energy use of new housing by 50 percent, and
(B) reduce energy use in existing homes by 30 percent.
(2) Industrial energy efficiency.--The goal of the
industrial energy efficiency program shall be to develop, in
partnership with industry, enabling technologies, designs,
production methods, and supporting activities that will, by
2010, enable energy-intensive industries such as the
following industries to reduce their energy intensity by at
least 25 percent--
(A) the wood product manufacturing industry;
(B) the pulp and paper industry;
(C) the petroleum and coal products manufacturing industry;
(D) the mining industry;
(E) the chemical manufacturing industry;
(F) the glass and glass product manufacturing industry;
(G) the iron and steel mills and ferroalloy manufacturing
industry;
(H) the primary aluminum production industry;
(I) the foundries industry; and
(J) United States agriculture.
(3) Transportation energy efficiency.--The goal of the
transportation energy efficiency program shall be to develop,
in partnership with industry, technologies that will enable
the achievement--
(A) by 2010, passenger automobiles with a fuel economy of
80 miles per gallon;
(B) by 2010, light trucks (classes 1 and 2a) with a fuel
economy of 60 miles per gallon;
(C) by 2010, medium trucks and buses (classes 2b through 6
and class 8 transit buses) with a fuel economy, in ton-miles
per gallon, that is three times that of year 2000 equivalent
vehicles;
(D) by 2010, heavy trucks (classes 7 and 8) with a fuel
economy, in ton-miles per gallon, that is two times that of
year 2000 equivalent vehicles; and
(E) by 2015, the production of fuel-cell powered passenger
vehicles with a fuel economy of 110 miles per gallon.
(4) Energy efficient distributed generation.--The goals of
the energy efficient on-site generation program shall be to
help remove environmental and regulatory barriers to on-site,
or distributed, generation and combined heat and power by
developing technologies by 2015 that achieve--
(A) electricity generating efficiencies greater than 40
percent for on-site generation technologies based upon
natural gas, including fuel cells, microturbines,
reciprocating engines and industrial gas turbines;
(B) combined heat and power total (electric and thermal)
efficiencies of more than 85 percent;
(C) fuel flexibility to include hydrogen, biofuels and
natural gas;
(D) near zero emissions of pollutants that form smog and
acid rain;
(E) reduction of carbon dioxide emissions by at least 40
percent;
(F) packaged system integration at end user facilities
providing complete services in heating, cooling, electricity
and air quality; and
(G) increased reliability for the consumer and greater
stability for the national electricity grid.
(c) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary for carrying out
research, development, demonstration, and technology
deployment activities under this subtitle--
(1) $700,000,000 for fiscal year 2003;
(2) $784,000,000 for fiscal year 2004;
(3) $878,000,000 for fiscal year 2005; and
(4) $983,000,000 for fiscal year 2006.
(d) Limitation on Use of Funds.--None of the funds
authorized to be appropriated in subsection (c) may be used
for the following programs of the Department--
(1) Weatherization Assistance Program;
(2) State Energy Program; or
(3) Federal Energy Management Program.

SEC. 1212. ENERGY EFFICIENCY SCIENCE INITIATIVE.

(a) Establishment and Authorization of Appropriations.--
From amounts authorized under section 1211(c), there are
authorized to be appropriated not more than $50,000,000 in
any fiscal year, for an Energy Efficiency Science Initiative
to be managed by the Assistant Secretary in the Department
with responsibility for energy conservation under section
203(a)(9) of the Department of Energy Organization Act (42
U.S.C. 7133(a)(9)), in consultation with the Director of the
Office of Science, for grants to be competitively awarded and
subject to peer review for research relating to energy
efficiency.
(b) Report.--The Secretary of Energy shall submit to the
Committee on Science and the Committee on Appropriations of
the United States House of Representatives, and to the
Committee on Energy and Natural Resources and the Committee
on Appropriations of the United States Senate, an annual
report on the activities of the Energy Efficiency Science
Initiative, including a description of the process used to
award the funds and an explanation of how the research
relates to energy efficiency.

SEC. 1213. NEXT GENERATION LIGHTING INITIATIVE.

(a) Establishment.--There is established in the Department
a Next Generation Lighting Initiative to research, develop,
and conduct demonstration activities on advanced solid-state
lighting technologies based on white light emitting diodes.
(b) Objectives.--
(1) In general.--The objectives of the initiative shall be
to develop, by 2011, advanced solid-state lighting
technologies based on white light emitting diodes that,
compared to incandescent and fluorescent lighting
technologies, are--
(A) longer lasting;
(B) more energy-efficient; and
(C) cost-competitive.
(2) Inorganic white light emitting diode.--The objective of
the initiative with respect to inorganic white light emitting
diodes shall be to develop an inorganic white light emitting
diode that has an efficiency of 160 lumens per watt and a 10-
year lifetime.
(3) Organic white light emitting diode.--The objective of
the initiative with respect to organic white light emitting
diodes shall be to develop an organic white light emitting
diode with an efficiency of 100 lumens per watt with a 5-year
lifetime that--
(A) illuminates over a full color spectrum;
(B) covers large areas over flexible surfaces; and
(C) does not contain harmful pollutants typical of
fluorescent lamps such as mercury.
(c) Consortium.--
(1) In general.--The Secretary shall initiate and manage
basic and manufacturing-related research on advanced solid-
state lighting technologies based on white light emitting
diodes for the initiative, in cooperation with the Next
Generation Lighting Initiative Consortium.
(2) Composition.--The consortium shall be composed of
firms, national laboratories, and other entities so that the
consortium is representative of the United States solid-state
lighting research, development, and manufacturing expertise
as a whole.
(3) Funding.--The consortium shall be funded by--
(A) participation fees; and
(B) grants provided under subsection (e)(1).
(4) Eligibility.--To be eligible to receive a grant under
subsection (e)(1), the consortium shall--
(A) enter into a consortium participation agreement that--
(i) is agreed to by all participants; and
(ii) describes the responsibilities of participants,
participation fees, and the scope of research activities; and
(B) develop an annual program plan.
(5) Intellectual property.--Participants in the consortium
shall have royalty-free nonexclusive rights to use
intellectual property derived from consortium research
conducted under subsection (e)(1).
(d) Planning Board.--
(1) In general.--Not later than 90 days after the
establishment of the consortium, the Secretary shall
establish and appoint the members of a planning board, to be
known as the ``Next Generation Lighting Initiative Planning
Board'', to assist the Secretary in carrying out this
section.
(2) Composition.--The planning board shall be composed of--
(A) four members from universities, national laboratories,
and other individuals with expertise in advanced solid-state
lighting and technologies based on white light emitting
diodes; and
(B) three members from a list of not less than six nominees
from industry submitted by the consortium.
(3) Study.--
(A) In general.--Not later than 90 days after the date on
which the Secretary appoints members to the planning board,
the planning board shall complete a study on strategies for
the development and implementation of advanced solid-state
lighting technologies based on white light emitting diodes.
(B) Requirements.--The study shall develop a comprehensive
strategy to implement, through the initiative, the use of
white light emitting diodes to increase energy efficiency and
enhance United States competitiveness.
(C) Implementation.--As soon as practicable after the study
is submitted to the Secretary, the Secretary shall implement
the initiative in accordance with the recommendations of the
planning board.
(4) Termination.--The planning board shall terminate upon
completion of the study under paragraph (3).
(e) Grants.--
(1) Fundamental research.--The Secretary, through the
consortium, shall make grants to conduct basic and
manufacturing-related research related to advanced solid-
state lighting technologies based on white light emitting
diode technologies.
(2) Technology development and demonstration.--The
Secretary shall enter into grants, contracts, and cooperative
agreements to conduct or promote technology research,
development, or demonstration activities. In providing
funding under this paragraph, the Secretary shall give
preference to participants in the consortium.
(3) Continuing assessment.--The consortium, in
collaboration with the Secretary, shall formulate annual
operating and performance objectives, develop technology
roadmaps, and recommend research and development priorities
for the initiative. The Secretary may also establish or
utilize advisory committees, or enter into appropriate
arrangements with the National Academy of Sciences, to
conduct periodic reviews of the initiative. The Secretary
shall consider the results of such assessment and review
activities in making funding decisions under paragraphs (1)
and (2) of this subsection.
(4) Technical assistance.--The National Laboratories shall
cooperate with and provide technical assistance to persons
carrying out projects under the initiative.
(5) Audits.--

[[Page S10790]]

(A) In general.--The Secretary shall retain an independent,
commercial auditor to determine the extent to which funds
made available under this section have been expended in a
manner that is consistent with the objectives under
subsection (b) and, in the case of funds made available to
the consortium, the annual program plan of the consortium
under subsection (c)(4)(B).
(B) Reports.--The auditor shall submit to Congress, the
Secretary, and the Comptroller General of the United States
an annual report containing the results of the audit.
(6) Applicable law.--Grants, contracts, and cooperative
agreements under this section shall not be subject to the
Federal Acquisition Regulation.
(f) Protection of Information.--Information obtained by the
Federal Government on a confidential basis under this section
shall be considered to constitute trade secrets and
commercial or financial information obtained from a person
and privileged or confidential under section 552(b)(4) of
title 5, United States Code.
(g) Authorization of Appropriations.--In addition to
amounts authorized under section 1211(c), there are
authorized to be appropriated for activities under this
section $50,000,000 for each of fiscal years 2003 through
2011.
(h) Definitions.--In this section:
(1) Advanced solid-state lighting.--The term ``advanced
solid-state lighting'' means a semiconducting device package
and delivery system that produces white light using
externally applied voltage.
(2) Consortium.--The term ``consortium'' means the Next
Generation Lighting Initiative Consortium under subsection
(c).
(3) Initiative.--The term ``initiative'' means the Next
Generation Lighting Initiative established under subsection
(a).
(4) inorganic white light emitting diode.--The term
``inorganic white light emitting diode'' means an inorganic
semiconducting package that produces white light using
externally applied voltage.
(5) Organic white light emitting diode.--The term ``organic
white light emitting diode'' means an organic semiconducting
compound that produces white light using externally applied
voltage.
(6) White light emitting diode.--The term ``white light
emitting diode'' means--
(A) an inorganic white light emitting diode; or
(B) an organic white light emitting diode.

SEC. 1214. RAILROAD EFFICIENCY.

(a) Establishment.--The Secretary shall, in cooperation
with the Secretaries of Transportation and Defense, and the
Administrator of the Environmental Protection Agency,
establish a public-private research partnership involving the
Federal Government, railroad carriers, locomotive
manufacturers, and the Association of American Railroads. The
goal of the initiative shall include developing and
demonstrating locomotive technologies that increase fuel
economy, reduce emissions, improve safety, and lower costs.
(b) Authorization of Appropriations.--There are authorized
to be appropriated to carry out the requirements of this
section $60,000,000 for fiscal year 2003 and $70,000,000 for
fiscal year 2004.

SEC. 1215. HIGH POWER DENSITY INDUSTRY PROGRAM.

The Secretary shall establish a comprehensive research,
development, demonstration and deployment program to improve
energy efficiency of high power density facilities, including
data centers, server farms, and telecommunications
facilities. Such program shall consider technologies that
provide significant improvement in thermal controls,
metering, load management, peak load reduction, or the
efficient cooling of electronics.

SEC. 1216. RESEARCH REGARDING PRECIOUS METAL CATALYSIS.

The Secretary of Energy may, for the purpose of developing
improved industrial and automotive catalysts, carry out
research in the use of precious metals (excluding platinum,
palladium, and rhodium) in catalysis directly, through
national laboratories, or through grants to or cooperative
agreements or contracts with public or nonprofit entities.
There are authorized to be appropriated to carry out this
section such sums as are necessary for fiscal years 2003
through 2006.

Subtitle B--Renewable Energy

SEC. 1221. ENHANCED RENEWABLE ENERGY RESEARCH AND
DEVELOPMENT.

(a) Program Direction.--The Secretary shall conduct
balanced energy research, development, demonstration, and
technology deployment programs to enhance the use of
renewable energy.
(b) Program Goals.--
(1) Wind power.--The goals of the wind power program shall
be to develop, in partnership with industry, a variety of
advanced wind turbine designs and manufacturing technologies
that are cost-competitive with fossil-fuel generated
electricity, with a focus on developing advanced low wind
speed technologies that, by 2007, will enable the expanding
utilization of widespread class 3 and 4 winds.
(2) Photovoltaics.--The goal of the photovoltaic program
shall be to develop, in partnership with industry, total
photovoltaic systems with installed costs of $4,000 per peak
kilowatt by 2005 and $2,000 per peak kilowatt by 2015.
(3) Solar thermal electric systems.--The goal of the solar
thermal electric systems program shall be to develop, in
partnership with industry, solar power technologies
(including baseload solar power) that are competitive with
fossil-fuel generated electricity by 2015, by combining high-
efficiency and high-temperature receivers with advanced
thermal storage and power cycles.
(4) Biomass-based power systems.--The goal of the biomass
program shall be to develop, in partnership with industry,
integrated power-generating systems, advanced conversion, and
feedstock technologies capable of producing electric power
that is cost-competitive with fossil-fuel generated
electricity by 2010, together with the production of fuels,
chemicals, and other products under paragraph (6).
(5) Geothermal energy.--The goal of the geothermal program
shall be to develop, in partnership with industry,
technologies and processes based on advanced hydrothermal
systems and advanced heat and power systems, including
geothermal heat pump technology, with a specific focus on--
(A) improving exploration and characterization technology
to increase the probability of drilling successful wells from
20 percent to 40 percent by 2006;
(B) reducing the cost of drilling by 2008 to an average
cost of $150 per foot; and
(C) developing enhanced geothermal systems technology with
the potential to double the useable geothermal resource base.
(6) Biofuels.--The goal of the biofuels program shall be to
develop, in partnership with industry--
(A) advanced biochemical and thermochemical conversion
technologies capable of making liquid and gaseous fuels from
cellulosic feedstocks that are price-competitive with
gasoline or diesel in either internal combustion engines or
fuel cell vehicles by 2010; and
(B) advanced biotechnology processes capable of making
biofuels, biobased polymers, and chemicals, with particular
emphasis on the development of biorefineries that use enzyme
based processing systems.

For purposes of this paragraph, the term ``cellulosic
feedstock'' means any portion of a food crop not normally
used in food production or any nonfood crop grown for the
purpose of producing biomass feedstock.
(7) Hydrogen-based energy systems.--The goals of the
hydrogen program shall be to support research and development
on technologies for production, storage, and use of hydrogen,
including fuel cells and, specifically, fuel-cell vehicle
development activities under section 1211.
(8) Hydropower.--The goal of the hydropower program shall
be to develop, in partnership with industry, a new generation
of turbine technologies that are less damaging to fish and
aquatic ecosystems.
(9) Electric energy systems and storage.--The goals of the
electric energy and storage program shall be to develop, in
partnership with industry--
(A) generators and transmission, distribution, and storage
systems that combine high capacity with high efficiency;
(B) technologies to interconnect distributed energy
resources with electric power systems, comply with any
national interconnection standards, have a minimum 10-year
useful life;
(C) advanced technologies to increase the average
efficiency of electric transmission facilities in rural and
remote areas, giving priority for demonstrations to advanced
transmission technologies that are being or have been field
tested;
(D) the use of new transmission technologies, including
flexible alternating current transmission systems, composite
conductor materials, advanced protection devices,
controllers, and other cost-effective methods and
technologies;
(E) the use of superconducting materials in power delivery
equipment such as transmission and distribution cables,
transformers, and generators;
(F) energy management technologies for enterprises with
aggregated loads and distributed generation, such as power
parks;
(G) economic and system models to measure the costs and
benefits of improved system performance;
(H) hybrid distributed energy systems to optimize two or
more distributed or on-site generation technologies; and
(I) real-time transmission and distribution system control
technologies that provide for continual exchange of
information between generation, transmission, distribution,
and end-user facilities.
(c) Special Projects.--In carrying out this section, the
Secretary shall demonstrate--
(1) the use of advanced wind power technology, biomass,
geothermal energy systems, and other renewable energy
technologies to assist in delivering electricity to rural and
remote locations;
(2) the combined use of wind power and coal gasification
technologies; and
(3) the use of high temperature superconducting technology
in projects to demonstrate the development of superconductors
that enhance the reliability, operational flexibility, or
power-carrying capability of electric transmission systems or
increase the electrical or operational efficiency of electric
energy generation, transmission, distribution and storage
systems.
(d) Financial Assistance to Rural Areas.--In carrying out
special projects under subsection (c), the Secretary may
provide financial assistance to rural electric cooperatives
and other rural entities.
(e) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary for carrying out
research, development, demonstration, and technology
deployment activities under this subtitle--
(1) $500,000,000 for fiscal year 2003;
(2) $595,000,000 for fiscal year 2004;
(3) $683,000,000 for fiscal year 2005; and
(4) $733,000,000 for fiscal year 2006, of which
$100,000,000 may be allocated to meet the goals of subsection
(b)(1).

SEC. 1222. BIOENERGY PROGRAMS.

(a) Program Direction.--The Secretary shall carry out
research, development, demonstration, and technology
development activities related to bioenergy, including
programs under paragraphs (4) and (6) of section 1221(b).

[[Page S10791]]

(b) Authorization of Appropriations.--
(1) Biopower energy systems.--From amounts authorized under
section 1221(e), there are authorized to be appropriated to
the Secretary for biopower energy systems--
(A) $60,300,000 for fiscal year 2003;
(B) $69,300,000 for fiscal year 2004;
(C) $79,600,000 for fiscal year 2005; and
(D) $86,250,000 for fiscal year 2006.
(2) Biofuels energy systems.--From amounts authorized under
section 1221(e), there are authorized to be appropriated to
the Secretary for biofuels energy systems--
(A) $57,500,000 for fiscal year 2003;
(B) $66,125,000 for fiscal year 2004;
(C) $76,000,000 for fiscal year 2005; and
(D) $81,400,000 for fiscal year 2006.
(3) Integrated bioenergy research and development.--The
Secretary may use funds authorized under paragraph (1) or (2)
for programs, projects, or activities that integrate
applications for both biopower and biofuels, including cross-
cutting research and development in feedstocks and economic
analysis.

SEC. 1223. HYDROGEN RESEARCH AND DEVELOPMENT.

(a) Short Title.--This section may be cited as the
``Hydrogen Future Act of 2003''.
(b) Purposes.--Section 102(b) of the Spark M. Matsunaga
Hydrogen Research, Development, and Demonstration Act of 1990
(42 U.S.C. 12401(b)) is amended by striking paragraphs (2)
and (3) and inserting the following:
``(2) to direct the Secretary to develop a program of
technology assessment, information transfer, and education in
which Federal agencies, members of the transportation,
energy, and other industries, and other entities may
participate;
``(3) to develop methods of hydrogen production that
minimize production of greenhouse gases, including
developing--
``(A) efficient production from nonrenewable resources; and
``(B) cost-effective production from renewable resources
such as biomass, geothermal, wind, and solar energy; and
``(4) to foster the use of hydrogen as a major energy
source, including developing the use of hydrogen in--
``(A) isolated villages, islands, and communities in which
other energy sources are not available or are very expensive;
and
``(B) foreign economic development, to avoid environmental
damage from increased fossil fuel use.''.
(c) Report to Congress.--Section 103 of the Spark M.
Matsunaga Hydrogen Research, Development, and Demonstration
Act of 1990 (42 U.S.C. 12402) is amended--
(1) in subsection (a), by striking ``January 1, 1999,'' and
inserting ``1 year after the date of enactment of the
Hydrogen Future Act of 2003, and biennially thereafter,'';
(2) in subsection (b), by striking paragraphs (1) and (2)
and inserting the following:
``(1) an analysis of hydrogen-related activities throughout
the United States Government to identify productive areas for
increased intragovernmental collaboration;
``(2) recommendations of the Hydrogen Technical Advisory
Panel established by section 108 for any improvements in the
program that are needed, including recommendations for
additional legislation; and
``(3) to the extent practicable, an analysis of State and
local hydrogen-related activities.''; and
(3) by adding at the end the following:
``(c) Coordination Plan.--The report under subsection (a)
shall be based on a comprehensive coordination plan for
hydrogen energy prepared by the Secretary in consultation
with other Federal agencies.''.
(d) Hydrogen Research and Development.--Section 104 of the
Spark M. Matsunaga Hydrogen Research, Development, and
Demonstration Act of 1990 (42 U.S.C. 12403) is amended--
(1) in subsection (b)(1), by striking ``marketplace;'' and
inserting ``marketplace, including foreign markets,
particularly where an energy infrastructure is not well
developed;'';
(2) in subsection (e), by striking ``this chapter'' and
inserting ``this Act'';
(3) by striking subsection (g) and inserting the following:
``(g) Cost Sharing.--
``(1) Inability to fund entire cost.--The Secretary shall
not consider a proposal submitted by a person from industry
unless the proposal contains a certification that--
``(A) reasonable efforts to obtain non-Federal funding in
the amount necessary to pay 100 percent of the cost of the
project have been made; and
``(B) non-Federal funding in that amount could not
reasonably be obtained.
``(2) Non-federal share.--
``(A) In general.--The Secretary shall require a commitment
from non-Federal sources of at least 25 percent of the cost
of the project.
``(B) Reduction or elimination.--The Secretary may reduce
or eliminate the cost-sharing requirement under subparagraph
(A) for the proposed research and development project,
including for technical analyses, economic analyses, outreach
activities, and educational programs, if the Secretary
determines that reduction or elimination is necessary to
achieve the objectives of this Act.'';
(4) in subsection (i), by striking ``this chapter'' and
inserting ``this Act''.
(e) Demonstrations.--Section 105 of the Spark M. Matsunaga
Hydrogen Research, Development, and Demonstration Act of 1990
(42 U.S.C. 12404) is amended by striking subsection (c) and
inserting the following:
``(c) Non-Federal Share.--
``(1) In general.--Except as provided in paragraph (2), the
Secretary shall require a commitment from non-Federal sources
of at least 50 percent of the costs directly relating to a
demonstration project under this section.
``(2) Reduction.--The Secretary may reduce the non-Federal
requirement under paragraph (1) if the Secretary determines
that the reduction is appropriate considering the
technological risks involved in the project and is necessary
to meet the objectives of this Act.''.
(f) Technology Transfer.--Section 106 of the Spark M.
Matsunaga Hydrogen Research, Development, and Demonstration
Act of 1990 (42 U.S.C. 12405) is amended--
(1) in subsection (a)--
(A) in the first sentence--
(i) by striking ``The Secretary shall conduct a program
designed to accelerate wider application'' and inserting the
following:
``(1) In general.--The Secretary shall conduct a program
designed to--
``(A) accelerate wider application''; and
(ii) by striking ``private sector'' and inserting ``private
sector; and
``(B) accelerate wider application of hydrogen technologies
in foreign countries to increase the global market for the
technologies and foster global economic development without
harmful environmental effects.''; and
(B) in the second sentence, by striking ``The Secretary''
and inserting the following:
``(2) Advice and assistance.--The Secretary''; and
(2) in subsection (b)--
(A) in paragraph (2), by redesignating subparagraphs (A)
through (D) as clauses (i) through (iv), respectively, and
indenting appropriately;
(B) by redesignating paragraphs (1) and (2) as
subparagraphs (A) and (B), respectively, and indenting
appropriately;
(C) by striking ``The Secretary, in'' and inserting the
following:
``(1) In general.--The Secretary, in'';
(D) by striking ``The information'' and inserting the
following:
``(2) Activities.--The information''; and
(E) in paragraph (1) (as designated by subparagraph (C))--
(i) in subparagraph (A) (as redesignated by subparagraph
(B)), by striking ``an inventory'' and inserting ``an update
of the inventory''; and
(ii) in subparagraph (B) (as redesignated by subparagraph
(B)), by striking ``develop'' and all that follows through
``to improve'' and inserting ``develop with the National
Aeronautics and Space Administration, the Department of
Energy, other Federal agencies as appropriate, and industry,
an information exchange program to improve''.
(g) Technical Panel Review.--
(1) In general.--Section 108 of the Spark M. Matsunaga
Hydrogen Research, Development, and Demonstration Act of 1990
(42 U.S.C. 12407) is amended--
(A) in subsection (b)--
(i) by striking ``(b) Membership.--The technical panel
shall be appointed'' and inserting the following:
``(b) Membership.--
``(1) In general.--The technical panel shall be comprised
of not fewer than 9 nor more than 15 members appointed'';
(ii) by striking the second sentence and inserting the
following:
``(2) Terms.--
``(A) In general.--The term of a member of the technical
panel shall be not more than 3 years.
``(B) Staggered terms.--The Secretary may appoint members
of the technical panel in a manner that allows the terms of
the members serving at any time to expire at spaced intervals
so as to ensure continuity in the functioning of the
technical panel.
``(C) Reappointment.--A member of the technical panel whose
term expires may be reappointed.''; and
(iii) by striking ``The technical panel shall have a
chairman,'' and inserting the following:
``(3) Chairperson.--The technical panel shall have a
chairperson,''; and
(B) in subsection (d)--
(i) in the matter preceding paragraph (1), by striking
``the following items'';
(ii) in paragraph (1), by striking ``and'' at the end;
(iii) in paragraph (2), by striking the period at the end
and inserting ``; and''; and
(iv) by adding at the end the following:
``(3) the plan developed by the interagency task force
under section 202(b) of the Hydrogen Future Act of 1996.''.
(2) New appointments.--Not later than 180 days after the
date of enactment of this Act, the Secretary--
(A) shall review the membership composition of the Hydrogen
Technical Advisory Panel; and
(B) may appoint new members consistent with the amendments
made by subsection (a).
(h) Authorization of Appropriations.--Section 109 of the
Spark M. Matsunaga Hydrogen Research, Development, and
Demonstration Act of 1990 (42 U.S.C. 12408) is amended--
(1) in paragraph (8), by striking ``and'';
(2) in paragraph (9), by striking the period and inserting
a semicolon; and
(3) by adding at the end the following:
``(10) $65,000,000 for fiscal year 2003;
``(11) $70,000,000 for fiscal year 2004;
``(12) $75,000,000 for fiscal year 2005; and
``(13) $80,000,000 for fiscal year 2006.''.
(i) Fuel Cells.--
(1) Integration of fuel cells with hydrogen production
systems.--Section 201 of the Hydrogen Future Act of 1996 is
amended--
(A) in subsection (a) by striking ``(a) Not later than 180
days after the date of enactment of this section, and
subject'' and inserting ``(a) In General.--Subject'';
(B) by striking ``with--'' and all that follows and
inserting ``into Federal, State, and local government
facilities for stationary and transportation applications.'';

[[Page S10792]]

(C) in subsection (b), by striking ``gas is'' and inserting
``basis'';
(D) in subsection (c)(2), by striking ``systems described
in subsections (a)(1) and (a)(2)'' and inserting ``projects
proposed''; and
(E) by striking subsection (d) and inserting the following:
``(d) Non-Federal Share.--
``(1) In general.--Except as provided in paragraph (2), the
Secretary shall require a commitment from non-Federal sources
of at least 50 percent of the costs directly relating to a
demonstration project under this section.
``(2) Reduction.--The Secretary may reduce the non-Federal
requirement under paragraph (1) if the Secretary determines
that the reduction is appropriate considering the
technological risks involved in the project and is necessary
to meet the objectives of this Act.''.
(2) Cooperative and cost-sharing agreements; integration of
technical information.--Title II of the Hydrogen Future Act
of 1996 (42 U.S.C. 12403 note; Public Law 104-271) is amended
by striking section 202 and inserting the following:

``SEC. 202. INTERAGENCY TASK FORCE.

``(a) Establishment.--Not later than 120 days after the
date of enactment of this section, the Secretary shall
establish an interagency task force led by a Deputy Assistant
Secretary of the Department of Energy and comprised of
representatives of--
``(1) the Office of Science and Technology Policy;
``(2) the Department of Transportation;
``(3) the Department of Defense;
``(4) the Department of Commerce (including the National
Institute for Standards and Technology);
``(5) the Environmental Protection Agency;
``(6) the National Aeronautics and Space Administration;
and
``(7) other agencies as appropriate.
``(b) Duties.--
``(1) In general.--The task force shall develop a plan for
carrying out this title.
``(2) Focus of plan.--The plan shall focus on development
and demonstration of integrated systems and components for--
``(A) hydrogen production, storage, and use in Federal,
State, and local government buildings and vehicles;
``(B) hydrogen-based infrastructure for buses and other
fleet transportation systems that include zero-emission
vehicles; and
``(C) hydrogen-based distributed power generation,
including the generation of combined heat, power, and
hydrogen.

``SEC. 203. COOPERATIVE AND COST-SHARING AGREEMENTS.

``The Secretary shall enter into cooperative and cost-
sharing agreements with Federal, State, and local agencies
for participation by the agencies in demonstrations at
facilities administered by the agencies, with the aim of
integrating high efficiency hydrogen systems using fuel cells
into the facilities to provide immediate benefits and promote
a smooth transition to hydrogen as an energy source.

``SEC. 204. INTEGRATION AND DISSEMINATION OF TECHNICAL
INFORMATION.

``The Secretary shall--
``(1) integrate all the technical information that becomes
available as a result of development and demonstration
projects under this title;
``(2) make the information available to all Federal and
State agencies for dissemination to all interested persons;
and
``(3) foster the exchange of generic, nonproprietary
information and technology developed under this title among
industry, academia, and Federal, State, and local
governments, to help the United States economy attain the
economic benefits of the information and technology.

``SEC. 205. AUTHORIZATION OF APPROPRIATIONS.

``There are authorized to be appropriated, for activities
under this title--
``(1) $25,000,000 for fiscal year 2003;
``(2) $30,000,000 for fiscal year 2004;
``(3) $35,000,000 for fiscal year 2005; and
``(4) $40,000,000 for fiscal year 2006.''.

Subtitle C--Fossil Energy

SEC. 1231. ENHANCED FOSSIL ENERGY RESEARCH AND DEVELOPMENT.

(a) Program Direction.--The Secretary shall conduct a
balanced energy research, development, demonstration, and
technology deployment program to enhance fossil energy.
(b) Program Goals.--
(1) Core fossil research and development.--The goals of the
core fossil research and development program shall be to
reduce emissions from fossil fuel use by developing
technologies, including precombustion technologies, by 2015
with the capability of realizing--
(A) electricity generating efficiencies of 60 percent for
coal and 75 percent for natural gas;
(B) combined heat and power thermal efficiencies of more
than 85 percent;
(C) fuels utilization efficiency of 75 percent for the
production of liquid transportation fuels from coal;
(D) near zero emissions of mercury and of emissions that
form fine particles, smog, and acid rain;
(E) reduction of carbon dioxide emissions by at least 40
percent through efficiency improvements and 100 percent with
sequestration; and
(F) improved reliability, efficiency, reductions of air
pollutant emissions, or reductions in solid waste disposal
requirements.
(2) Offshore oil and natural gas resources.--The goal of
the offshore oil and natural gas resources program shall be
to develop technologies to--
(A) extract methane hydrates in coastal waters of the
United States, and
(B) develop natural gas and oil reserves in the ultra-
deepwater of the Central and Western Gulf of Mexico.
(3) Onshore oil and natural gas resources.--The goal of the
onshore oil and natural gas resources program shall be to
advance the science and technology available to domestic
onshore petroleum producers, particularly independent
operators, through--
(A) advances in technology for exploration and production
of domestic petroleum resources, particularly those not
accessible with current technology;
(B) improvement in the ability to extract hydrocarbons from
known reservoirs and classes of reservoirs; and
(C) development of technologies and practices that reduce
the threat to the environment from petroleum exploration and
production and decrease the cost of effective environmental
compliance.
(4) Transportation fuels.--The goals of the transportation
fuels program shall be to increase the price elasticity of
oil supply and demand by focusing research on--
(A) reducing the cost of producing transportation fuels
from coal and natural gas; and
(B) indirect liquefaction of coal and biomass.
(c) Authorization of Appropriations.--
(1) In general.--There are authorized to be appropriated to
the Secretary for carrying out research, development,
demonstration, and technology deployment activities under
this section--
(A) $485,000,000 for fiscal year 2003;
(B) $508,000,000 for fiscal year 2004;
(C) $532,000,000 for fiscal year 2005; and
(D) $558,000,000 for fiscal year 2006.
(2) Limits on use of funds.--None of the funds authorized
in paragraph (1) may be used for--
(A) fossil energy environmental restoration;
(B) import/export authorization;
(C) program direction; or
(D) general plant projects.
(3) Coal-based projects.--The coal-based projects funded
under this section shall be consistent with the goals in
subsection (b). The program shall emphasize carbon capture
and sequestration technologies and gasification technologies,
including gasification combined cycle, gasification fuel
cells, gasification co-production, hybrid gasification/
combustion, or other technology with the potential to address
the goals in subparagraphs (D) or (E) of subsection (b)(1).

SEC. 1232. POWER PLANT IMPROVEMENT INITIATIVE.

(a) Program Direction.--The Secretary shall conduct a
balanced energy research, development, demonstration, and
technology deployment program to demonstrate commercial
applications of advanced lignite and coal-based technologies
applicable to new or existing power plants (including co-
production plants) that advance the efficiency, environmental
performance, and cost-competitiveness substantially beyond
technologies that are in operation or have been demonstrated
by the date of enactment of this subtitle.
(b) Technical Milestones.--
(1) In general.--The Secretary shall set technical
milestones specifying efficiency and emissions levels that
projects shall be designed to achieve. The milestones shall
become more restrictive over the life of the program.
(2) 2010 efficiency milestones.--The milestones shall be
designed to achieve by 2010 interim thermal efficiency of--
(A) forty-five percent for coal of more than 9,000 Btu;
(B) forty-four percent for coal of 7,000 to 9,000 Btu; and
(C) forty-two percent for coal of less than 7,000 Btu.
(3) 2020 efficiency milestones.--The milestones shall be
designed to achieve by 2020 thermal efficiency of--
(A) sixty percent for coal of more than 9,000 Btu;
(B) fifty-nine percent for coal of 7,000 to 9,000 Btu; and
(C) fifty-seven percent for coal of less than 7,000 Btu.
(4) Emissions milestones.--The milestones shall include
near zero emissions of mercury and greenhouse gases and of
emissions that form fine particles, smog, and acid rain.
(5) Regional and quality differences.--The Secretary may
consider regional and quality differences in developing the
efficiency milestones.
(c) Project Criteria.--The demonstration activities
proposed to be conducted at a new or existing coal-based
electric generation unit having a nameplate rating of not
less than 100 megawatts, excluding a co-production plant,
shall include at least one of the following--
(1) a means of recycling or reusing a significant portion
of coal combustion wastes produced by coal-based generating
units, excluding practices that are commercially available by
the date of enactment of this subtitle;
(2) a means of capture and sequestering emissions,
including greenhouse gases, in a manner that is more
effective and substantially below the cost of technologies
that are in operation or that have been demonstrated by the
date of enactment of this subtitle;
(3) a means of controlling sulfur dioxide and nitrogen
oxide or mercury in a manner that improves environmental
performance beyond technologies that are in operation or that
have been demonstrated by the date of enactment of this
subtitle--
(A) in the case of an existing unit, achieve an overall
thermal design efficiency improvement compared to the
efficiency of the unit as operated, of not less than--
(i) 7 percent for coal of more than 9,000 Btu;
(ii) 6 percent for coal of 7,000 to 9,000 Btu; or
(iii) 4 percent for coal of less than 7,000 Btu; or
(B) in the case of a new unit, achieve the efficiency
milestones set for in subsection (b) compared to the
efficiency of a typical unit as operated on the date of
enactment of this subtitle,

[[Page S10793]]

before any retrofit, repowering, replacement, or
installation.
(d) Study.--The Secretary, in consultation with the
Administrator of the Environmental Protection Agency, the
Secretary of the Interior, and interested entities (including
coal producers, industries using coal, organizations to
promote coal or advanced coal technologies, environmental
organizations, and organizations representing workers), shall
conduct an assessment that identifies performance criteria
that would be necessary for coal-based technologies to meet,
to enable future reliance on coal in an environmentally
sustainable manner for electricity generation, use as a
chemical feedstock, and use as a transportation fuel.
(e) Authorization of Appropriations.--
(1) In general.--There are authorized to be appropriated to
the Secretary for carrying out activities under this section
$200,000,000 for each of fiscal years 2003 through 2011.
(2) Limitation on funding of projects.--Eighty percent of
the funding under this section shall be limited to--
(A) carbon capture and sequestration technologies;
(B) gasification technologies, including gasification
combined cycle, gasification fuel cells, gasification co-
production, or hybrid gasification/combustion; or
(C) other technology either by itself or in conjunction
with other technologies that has the potential to achieve
near zero emissions.

SEC. 1233. RESEARCH AND DEVELOPMENT FOR ADVANCED SAFE AND
EFFICIENT COAL MINING TECHNOLOGIES.

(a) Establishment.--The Secretary of Energy shall establish
a cooperative research partnership involving appropriate
Federal agencies, coal producers, including associations,
equipment manufacturers, universities with mining engineering
departments, and other relevant entities to--
(1) develop mining research priorities identified by the
Mining Industry of the Future Program and in the
recommendations from relevant reports of the National Academy
of Sciences on mining technologies;
(2) establish a process for conducting joint industry-
Government research and development; and
(3) expand mining research capabilities at institutions of
higher education.
(b) Authorization of Appropriations.--
(1) In general.--There are authorized to be appropriated to
carry out activities under this section, $12,000,000 in
fiscal year 2003 and $15,000,000 in fiscal year 2004.
(2) Limit on use of funds.--Not less than 20 percent of any
funds appropriated in a given fiscal year under this
subsection shall be dedicated to research carried out at
institutions of higher education.

SEC. 1234. ULTRA-DEEPWATER AND UNCONVENTIONAL RESOURCE
EXPLORATION AND PRODUCTION TECHNOLOGIES.

(a) Definitions.--In this section:
(1) Advisory committee.--The term ``Advisory Committee''
means the Ultra-Deepwater and Unconventional Resource
Technology Advisory Committee established under subsection
(c).
(2) Award.--The term ``award'' means a cooperative
agreement, contract, award or other types of agreement as
appropriate.
(3) Deepwater.--The term ``deepwater'' means a water depth
that is greater than 200 but less than 1,500 meters.
(4) Eligible award recipient.--The term ``eligible award
recipient'' includes--
(A) a research institution;
(B) an institution of higher education;
(C) a corporation; and
(D) a managing consortium formed among entities described
in subparagraphs (A) through (C).
(5) Institution of higher education.--The term
``institution of higher education'' has the meaning given the
term in section 101 of the Higher Education Act of 1965 (20
U.S.C. 1001).
(6) Managing consortium.--The term ``managing consortium''
means an entity that--
(A) exists as of the date of enactment of this section;
(B)(i) is an organization described in section 501(c)(3) of
the Internal Revenue Code of 1986; and
(ii) is exempt from taxation under section 501(a) of that
Code;
(C) is experienced in planning and managing programs in
natural gas or other petroleum exploration and production
research, development, and demonstration; and
(D) has demonstrated capabilities and experience in
representing the views and priorities of industry,
institutions of higher education and other research
institutions in formulating comprehensive research and
development plans and programs.
(7) Program.--The term ``program'' means the program of
research, development, and demonstration established under
subsection (b)(1)(A).
(8) Ultra-deepwater.--The term ``ultra-deepwater'' means a
water depth that is equal to or greater than 1,500 meters.
(9) Ultra-deepwater architecture.--The term ``ultra-
deepwater architecture'' means the integration of
technologies to explore and produce natural gas or petroleum
products located at ultra-deepwater depths.
(10) Ultra-deepwater resource.--The term ``ultra-deepwater
resource'' means natural gas or any other petroleum resource
(including methane hydrate) located in an ultra-deepwater
area.
(11) Unconventional resource.--The term ``unconventional
resource'' means natural gas or any other petroleum resource
located in a formation on physically or economically
inaccessible land currently available for lease for purposes
of natural gas or other petroleum exploration or production.
(b) Ultra-Deepwater and Unconventional Exploration and
Production Program.--
(1) Establishment.--
(A) In general.--The Secretary shall establish a program of
research into, and development and demonstration of, ultra-
deepwater resource and unconventional resource exploration
and production technologies.
(B) Location; implementation.--The program under this
subsection shall be carried out--
(i) in areas on the outer Continental Shelf that, as of the
date of enactment of this section, are available for leasing;
and
(ii) on unconventional resources.
(2) Components.--The program shall include one or more
programs for long-term research into--
(A) new deepwater ultra-deepwater resource and
unconventional resource exploration and production
technologies; or
(B) environmental mitigation technologies for production of
ultra-deepwater resource and unconventional resource.
(c) Advisory Committee.--
(1) Establishment.--Not later than 30 days after the date
of enactment of this section, the Secretary shall establish
an advisory committee to be known as the ``Ultra-Deepwater
and Unconventional Resource Technology Advisory Committee''.
(2) Membership.--
(A) Composition.--Subject to subparagraph (B), the advisory
committee shall be composed of seven members appointed by the
Secretary that--
(i) have extensive operational knowledge of and experience
in the natural gas and other petroleum exploration and
production industry; and
(ii) are not Federal employees or employees of contractors
to a Federal agency.
(B) Expertise.--Of the members of the advisory committee
appointed under subparagraph (A)--
(i) at least four members shall have extensive knowledge of
ultra-deepwater resource exploration and production
technologies;
(ii) at least three members shall have extensive knowledge
of unconventional resource exploration and production
technologies.
(3) Duties.--The advisory committee shall advise the
Secretary in the implementation of this section.
(4) Compensation.--A member of the advisory committee shall
serve without compensation but shall receive travel expenses,
including per diem in lieu of subsistence, in accordance with
applicable provisions under subchapter I of chapter 57 of
title 5, United States Code.
(d) Awards.--
(1) Types of awards.--
(A) Ultra-deepwater resources.--
(i) In general.--The Secretary shall make awards for
research into, and development and demonstration of, ultra-
deepwater resource exploration and production technologies--

(I) to maximize the value of the ultra-deepwater resources
of the United States;
(II) to increase the supply of ultra-deepwater resources by
lowering the cost and improving the efficiency of exploration
and production of such resources; and
(III) to improve safety and minimize negative environmental
impacts of that exploration and production.

(ii) Ultra-deepwater architecture.--In furtherance of the
purposes described in clause (i), the Secretary shall, where
appropriate, solicit proposals from a managing consortium to
develop and demonstrate next-generation architecture for
ultra-deepwater resource production.
(B) Unconventional resources.--The Secretary shall make
awards--
(i) to carry out research into, and development and
demonstration of, technologies to maximize the value of
unconventional resources; and
(ii) to develop technologies to simultaneously--

(I) increase the supply of unconventional resources by
lowering the cost and improving the efficiency of exploration
and production of unconventional resources; and
(II) improve safety and minimize negative environmental
impacts of that exploration and production.

(2) Conditions.--An award made under this subsection shall
be subject to the following conditions:
(A) Multiple entities.--If an award recipient is composed
of more than one eligible organization, the recipient shall
provide a signed contract, agreed to by all eligible
organizations comprising the award recipient, that defines,
in a manner that is consistent with all applicable law in
effect as of the date of the contract, all rights to
intellectual property for--
(i) technology in existence as of that date; and
(ii) future inventions conceived and developed using funds
provided under the award.
(B) Components of application.--An application for an award
for a demonstration project shall describe with specificity
any intended commercial applications of the technology to be
demonstrated.
(C) Cost sharing.--Non-Federal cost sharing shall be in
accordance with section 1403.
(e) Plan and Funding.--
(1) In general.--The Secretary, and where appropriate, a
managing consortium under subsection (d)(1)(A)(ii), shall
formulate annual operating and performance objectives,
develop multiyear technology roadmaps, and establish research
and development priorities for the funding of activities
under this section which will serve as guidelines for making
awards including cost-matching objectives.
(2) Industry input.--In carrying out this program, the
Secretary shall promote maximum industry input through the
use of managing consortia or other organizations in planning
and executing the research areas and conducting

[[Page S10794]]

workshops or reviews to ensure that this program focuses on
industry problems and needs.
(f) Auditing.--
(1) In general.--The Secretary shall retain an independent,
commercial auditor to determine the extent to which funds
authorized by this section, provided through a managing
consortium, are expended in a manner consistent with the
purposes of this section.
(2) Reports.--The auditor retained under paragraph (1)
shall submit to the Secretary, and the Secretary shall
transmit to the appropriate congressional committees, an
annual report that describes--
(A) the findings of the auditor under paragraph (1); and
(B) a plan under which the Secretary may remedy any
deficiencies identified by the auditor.
(g) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary such sums as may be
necessary to carry out this section.
(h) Termination of Authority.--The authority provided by
this section shall terminate on September 30, 2009.
(i) Savings Provision.--Nothing in this section is intended
to displace, duplicate or diminish any previously authorized
research activities of the Department of Energy.

SEC. 1235. RESEARCH AND DEVELOPMENT FOR NEW NATURAL GAS
TRANSPORTATION TECHNOLOGIES.

The Secretary of Energy shall conduct a comprehensive 5-
year program for research, development and demonstration to
improve the reliability, efficiency, safety and integrity of
the natural gas transportation and distribution
infrastructure and for distributed energy resources
(including microturbines, fuel cells, advanced engine-
generators, gas turbines, reciprocating engines, hybrid power
generation systems, and all ancillary equipment for dispatch,
control and maintenance).

SEC. 1236. AUTHORIZATION OF APPROPRIATIONS FOR OFFICE OF
ARCTIC ENERGY.

There are authorized to be appropriated to the Secretary
for the Office of Arctic Energy under section 3197 of the
Floyd D. Spence National Defense Authorization Act for Fiscal
Year 2001 (Public Law 106-398) such sums as may be necessary,
but not to exceed $25,000,000 for each of fiscal years 2003
through 2011.

SEC. 1237. CLEAN COAL TECHNOLOGY LOAN.

There is authorized to be appropriated not to exceed
$125,000,000 to the Secretary of Energy to provide a loan to
the owner of the experimental plant constructed under United
States Department of Energy cooperative agreement number DE-
FC22-91PC99544 on such terms and conditions as the Secretary
determines, including interest rates and upfront payments.

Subtitle D--Nuclear Energy

SEC. 1241. ENHANCED NUCLEAR ENERGY RESEARCH AND DEVELOPMENT.

(a) Program Direction.--The Secretary shall conduct an
energy research, development, demonstration, and technology
deployment program to enhance nuclear energy.
(b) Program Goals.--The program shall--
(1) support research related to existing United States
nuclear power reactors to extend their lifetimes and increase
their reliability while optimizing their current operations
for greater efficiencies;
(2) examine--
(A) advanced proliferation-resistant and passively safe
reactor designs;
(B) new reactor designs with higher efficiency, lower cost,
and improved safety;
(C) in coordination with activities carried out under the
amendments made by section 1223, designs for a high
temperature reactor capable of producing large-scale
quantities of hydrogen using thermochemical processes;
(D) proliferation-resistant and high-burn-up nuclear fuels;
(E) minimization of generation of radioactive materials;
(F) improved nuclear waste management technologies; and
(G) improved instrumentation science;
(3) attract new students and faculty to the nuclear
sciences and nuclear engineering and related fields
(including health physics and nuclear and radiochemistry)
through--
(A) university-based fundamental research for existing
faculty and new junior faculty;
(B) support for the re-licensing of existing training
reactors at universities in conjunction with industry; and
(C) completing the conversion of existing training reactors
with proliferation-resistant fuels that are low enriched and
to adapt those reactors to new investigative uses;
(4) maintain a national capability and infrastructure to
produce medical isotopes and ensure a well trained cadre of
nuclear medicine specialists in partnership with industry;
(5) ensure that our nation has adequate capability to power
future satellite and space missions; and
(6) maintain, where appropriate through a prioritization
process, a balanced research infrastructure so that future
research programs can use these facilities.
(c) Authorization of Appropriations.--
(1) Core nuclear research programs.--There are authorized
to be appropriated to the Secretary for carrying out
research, development, demonstration, and technology
deployment activities under subsection (b)(1) through (3)--
(A) $100,000,000 for fiscal year 2003;
(B) $110,000,000 for fiscal year 2004;
(C) $120,000,000 for fiscal year 2005; and
(D) $130,000,000 for fiscal year 2006.
(2) Supporting nuclear activities.--There are authorized to
be appropriated to the Secretary for carrying out activities
under subsection (b)(4) through (6), as well as nuclear
facilities management and program direction--
(A) $200,000,000 for fiscal year 2003;
(B) $202,000,000 for fiscal year 2004;
(C) $207,000,000 for fiscal year 2005; and
(D) $212,000,000 for fiscal year 2006.

SEC. 1242. UNIVERSITY NUCLEAR SCIENCE AND ENGINEERING
SUPPORT.

(a) Establishment.--The Secretary shall support a program
to maintain the nation's human resource investment and
infrastructure in the nuclear sciences and engineering and
related fields (including health physics and nuclear and
radiochemistry), consistent with departmental missions
related to civilian nuclear research and development.
(b) Duties.--In carrying out the program under this
section, the Secretary shall--
(1) develop a graduate and undergraduate fellowship program
to attract new and talented students;
(2) assist universities in recruiting and retaining new
faculty in the nuclear sciences and engineering through a
Junior Faculty Research Initiation Grant Program;
(3) support fundamental nuclear sciences and engineering
research through the Nuclear Engineering Education Research
Program;
(4) encourage collaborative nuclear research between
industry, national laboratories and universities through the
Nuclear Energy Research Initiative; and
(5) support communication and outreach related to nuclear
science and engineering.
(c) Maintaining University Research and Training Reactors
and Associated Infrastructure.--Activities under this section
may include:
(1) Converting research reactors to low-enrichment fuels,
upgrading operational instrumentation, and sharing of
reactors among universities.
(2) Providing technical assistance, in collaboration with
the United States nuclear industry, in re-licensing and
upgrading training reactors as part of a student training
program.
(3) Providing funding for reactor improvements as part of a
focused effort that emphasizes research, training, and
education.
(d) University-National Laboratory Interactions.--The
Secretary shall develop--
(1) a sabbatical fellowship program for university
professors to spend extended periods of time at National
Laboratories in the areas of nuclear science and technology;
and
(2) a visiting scientist program in which National
Laboratory staff can spend time in academic nuclear science
and engineering departments. The Secretary may provide for
fellowships for students to spend time at National
Laboratories in the area of nuclear science with a member of
the Laboratory staff acting as a mentor.
(e) Operating and Maintenance Costs.--Funding for a
research project provided under this section may be used to
offset a portion of the operating and maintenance costs of a
university research reactor used in the research project, on
a cost-shared basis with the university.
(f) Authorization of Appropriations.--From amounts
authorized under section 1241(c)(1), the following amounts
are authorized for activities under this section--
(1) $33,000,000 for fiscal year 2003;
(2) $37,900,000 for fiscal year 2004;
(3) $43,600,000 for fiscal year 2005; and
(4) $50,100,000 for fiscal year 2006.

SEC. 1243. NUCLEAR ENERGY RESEARCH INITIATIVE.

(a) Establishment.--The Secretary shall support a Nuclear
Energy Research Initiative for grants for research relating
to nuclear energy.
(b) Authorization of Appropriations.--From amounts
authorized under section 1241(c), there are authorized to be
appropriated to the Secretary for activities under this
section such sums as are necessary for each fiscal year.

SEC. 1244. NUCLEAR ENERGY PLANT OPTIMIZATION PROGRAM.

(a) Establishment.--The Secretary shall support a Nuclear
Energy Plant Optimization Program for grants to improve
nuclear energy plant reliability, availability, and
productivity. Notwithstanding section 1403, the program shall
require industry cost-sharing of at least 50 percent and be
subject to annual review by the Nuclear Energy Research
Advisory Committee of the Department.
(b) Authorization of Appropriations.--From amounts
authorized under section 1241(c), there are authorized to be
appropriated to the Secretary for activities under this
section such sums as are necessary for each fiscal year.

SEC. 1245. NUCLEAR ENERGY TECHNOLOGY DEVELOPMENT PROGRAM.

(a) Establishment.--The Secretary shall support a Nuclear
Energy Technology Development Program to develop a technology
roadmap to design and develop new nuclear energy powerplants
in the United States.
(b) Generation IV Reactor Study.--The Secretary shall, as
part of the program under subsection (a), also conduct a
study of Generation IV nuclear energy systems, including
development of a technology roadmap and performance of
research and development necessary to make an informed
technical decision regarding the most promising candidates
for commercial deployment. The study shall examine advanced
proliferation-resistant and passively safe reactor designs,
new reactor designs with higher efficiency, lower cost and
improved safety, proliferation-resistant and high burn-up
fuels, minimization of generation of radioactive materials,
improved nuclear waste management technologies, and improved
instrumentation science. Not later than December 31, 2002,
the Secretary shall submit to Congress a report describing
the results of the study.
(c) Authorization of Appropriations.--From amounts
authorized to be appropriated under section 1241(c), there
are authorized to be

[[Page S10795]]

appropriated to the Secretary for activities under this
section such sums as are necessary for each fiscal year.

Subtitle E--Fundamental Energy Science

SEC. 1251. ENHANCED PROGRAMS IN FUNDAMENTAL ENERGY SCIENCE.

(a) Program Direction.--The Secretary, acting through the
Office of Science, shall--
(1) conduct a comprehensive program of fundamental
research, including research on chemical sciences, physics,
materials sciences, biological and environmental sciences,
geosciences, engineering sciences, plasma sciences,
mathematics, and advanced scientific computing;
(2) maintain, upgrade and expand the scientific user
facilities maintained by the Office of Science and ensure
that they are an integral part of the departmental mission
for exploring the frontiers of fundamental science;
(3) maintain a leading-edge research capability in the
energy-related aspects of nanoscience and nanotechnology,
advanced scientific computing and genome research; and
(4) ensure that its fundamental science programs, where
appropriate, help inform the applied research and development
programs of the Department.
(b) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary for carrying out
research, development, demonstration, and technology
deployment activities under this subtitle--
(1) $3,785,000,000 for fiscal year 2003;
(2) $4,153,000,000 for fiscal year 2004;
(3) $4,586,000,000 for fiscal year 2005; and
(4) $5,000,000,000 for fiscal year 2006.

SEC. 1252. NANOSCALE SCIENCE AND ENGINEERING RESEARCH.

(a) Establishment.--The Secretary, acting through the
Office of Science, shall support a program of research and
development in nanoscience and nanoengineering consistent
with the Department's statutory authorities related to
research and development. The program shall include efforts
to further the understanding of the chemistry, physics,
materials science and engineering of phenomena on the scale
of 1 to 100 nanometers.
(b) Duties of the Office of Science.--In carrying out the
program under this section, the Office of Science shall--
(1) support both individual investigators and
multidisciplinary teams of investigators;
(2) pursuant to subsection (c), develop, plan, construct,
acquire, or operate special equipment or facilities for the
use of investigators conducting research and development in
nanoscience and nanoengineering;
(3) support technology transfer activities to benefit
industry and other users of nanoscience and nanoengineering;
and
(4) coordinate research and development activities with
industry and other Federal agencies.
(c) Nanoscience and Nanoengineering Research Centers and
Major Instrumentation.--
(1) Authorization.--From amounts authorized to be
appropriated under section 1251(b), the amounts specified
under subsection (d)(2) shall, subject to appropriations, be
available for projects to develop, plan, construct, acquire,
or operate special equipment, instrumentation, or facilities
for investigators conducting research and development in
nanoscience and nanoengineering.
(2) Projects.--Projects under paragraph (1) may include the
measurement of properties at the scale of 1 to 100
nanometers, manipulation at such scales, and the integration
of technologies based on nanoscience or nanoengineering into
bulk materials or other technologies.
(3) Facilities.--Facilities under paragraph (1) may include
electron microcharacterization facilities, microlithography
facilities, scanning probe facilities and related
instrumentation science.
(4) Collaboration.--The Secretary shall encourage
collaborations among universities, laboratories and industry
at facilities under this subsection. At least one facility
under this subsection shall have a specific mission of
technology transfer to other institutions and to industry.
(d) Authorization of Appropriations.--
(1) Total authorization.--From amounts authorized to be
appropriated under section 1251(b), the following amounts are
authorized for activities under this section--
(A) $270,000,000 for fiscal year 2003;
(B) $290,000,000 for fiscal year 2004;
(C) $310,000,000 for fiscal year 2005; and
(D) $330,000,000 for fiscal year 2006.
(2) Nanoscience and nanoengineering research centers and
major instrumentation.--Of the amounts under paragraph (1),
the following amounts are authorized to carry out subsection
(c)--
(A) $135,000,000 for fiscal year 2003;
(B) $150,000,000 for fiscal year 2004;
(C) $120,000,000 for fiscal year 2005; and
(D) $100,000,000 for fiscal year 2006.

SEC. 1253. ADVANCED SCIENTIFIC COMPUTING FOR ENERGY MISSIONS.

(a) Establishment.--The Secretary, acting through the
Office of Science, shall support a program to advance the
Nation's computing capability across a diverse set of grand
challenge computationally based science problems related to
departmental missions.
(b) Duties of the Office of Science.--In carrying out the
program under this section, the Office of Science shall--
(1) advance basic science through computation by developing
software to solve grand challenge science problems on new
generations of computing platforms;
(2) enhance the foundations for scientific computing by
developing the basic mathematical and computing systems
software needed to take full advantage of the computing
capabilities of computers with peak speeds of 100 teraflops
or more, some of which may be unique to the scientific
problem of interest;
(3) enhance national collaboratory and networking
capabilities by developing software to integrate
geographically separated researchers into effective research
teams and to facilitate access to and movement and analysis
of large (petabyte) data sets; and
(4) maintain a robust scientific computing hardware
infrastructure to ensure that the computing resources needed
to address DOE missions are available; explore new computing
approaches and technologies that promise to advance
scientific computing.
(c) High-Performance Computing Act Program.--Section 203(a)
of the High-Performance Computing Act of 1991 (15 U.S.C.
5523(a)) is amended--
(1) in paragraph (3), by striking ``and'';
(2) in paragraph (4), by striking the period and inserting
``; and''; and
(3) by adding after paragraph (4) the following:
``(5) conduct an integrated program of research,
development, and provision of facilities to develop and
deploy to scientific and technical users the high-performance
computing and collaboration tools needed to fulfill the
statutory missions of the Department of Energy in conducting
basic and applied energy research.''.
(d) Coordination With the DOE National Nuclear Security
Agency Accelerated Strategic Computing Initiative and Other
National Computing Programs.--The Secretary shall ensure that
this program, to the extent feasible, is integrated and
consistent with--
(1) the Accelerated Strategic Computing Initiative of the
National Nuclear Security Agency; and
(2) other national efforts related to advanced scientific
computing for science and engineering.
(e) Authorization of Appropriations.--From amounts
authorized under section 1251(b), the following amounts are
authorized for activities under this section--
(1) $285,000,000 for fiscal year 2003;
(2) $300,000,000 for fiscal year 2004;
(3) $310,000,000 for fiscal year 2005; and
(4) $320,000,000 for fiscal year 2006.

SEC. 1254. FUSION ENERGY SCIENCES PROGRAM AND PLANNING.

(a) Overall Plan for Fusion Energy Sciences Program.--
(1) In general.--Not later than 6 months after the date of
enactment of this subtitle, the Secretary, after consultation
with the Fusion Energy Sciences Advisory Committee, shall
develop and transmit to the Congress a plan to ensure a
strong scientific base for the Fusion Energy Sciences Program
within the Office of Science and to enable the experiments
described in subsections (b) and (c).
(2) Objectives of plan.--The plan under this subsection
shall include as its objectives--
(A) to ensure that existing fusion research facilities and
equipment are more fully utilized with appropriate
measurements and control tools;
(B) to ensure a strengthened fusion science theory and
computational base;
(C) to encourage and ensure that the selection of and
funding for new magnetic and inertial fusion research
facilities is based on scientific innovation and cost
effectiveness;
(D) to improve the communication of scientific results and
methods between the fusion science community and the wider
scientific community;
(E) to ensure that adequate support is provided to optimize
the design of the magnetic fusion burning plasma experiments
referred to in subsections (b) and (c); and
(F) to ensure that inertial confinement fusion facilities
are utilized to the extent practicable for the purpose of
inertial fusion energy research and development.
(b) Plan for United States Fusion Experiment.--
(1) In general.--The Secretary, after consultation with the
Fusion Energy Sciences Advisory Committee, shall develop a
plan for construction in the United States of a magnetic
fusion burning plasma experiment for the purpose of
accelerating scientific understanding of fusion plasmas. The
Secretary shall request a review of the plan by the National
Academy of Sciences and shall transmit the plan and the
review to the Congress by July 1, 2004.
(2) Requirements of plan.--The plan described in paragraph
(1) shall--
(A) address key burning plasma physics issues; and
(B) include specific information on the scientific
capabilities of the proposed experiment, the relevance of
these capabilities to the goal of practical fusion energy,
and the overall design of the experiment including its
estimated cost and potential construction sites.
(c) Plan for Participation in an International
Experiment.--In addition to the plan described in subsection
(b), the Secretary, after consultation with the Fusion Energy
Sciences Advisory Committee, may also develop a plan for
United States participation in an international burning
plasma experiment for the same purpose, whose construction is
found by the Secretary to be highly likely and where United
States participation is cost-effective relative to the cost
and scientific benefits of a domestic experiment described in
subsection (b). If the Secretary elects to develop a plan
under this subsection, he shall include the information
described in subsection (b)(2), and an estimate of the cost
of United States participation in such an international
experiment. The Secretary shall request a review by the
National Academy of Sciences of a plan developed under this
subsection, and shall transmit the plan and the review to the
Congress no later than July 1, 2004.
(d) Authorization for Research and Development.--The
Secretary, through the Office of Science, may conduct any
research and development necessary to fully develop the plans
described in this section.

[[Page S10796]]

(e) Authorization of Appropriations.--From amounts
authorized under section 1251, the following amounts are
authorized for activities under this section and for
activities of the Fusion Energy Science Program--
(1) for fiscal year 2003, $335,000,000;
(2) for fiscal year 2004, $349,000,000;
(3) for fiscal year 2005, $362,000,000; and
(4) for fiscal year 2006, $377,000,000.

Subtitle F--Energy, Safety, and Environmental Protection

SEC. 1261. CRITICAL ENERGY INFRASTRUCTURE PROTECTION RESEARCH
AND DEVELOPMENT.

(a) In General.--The Secretary shall carry out a research,
development, demonstration and technology deployment program,
in partnership with industry, on critical energy
infrastructure protection, consistent with the roles and
missions outlined for the Secretary in Presidential Decision
Directive 63, entitled ``Critical Infrastructure
Protection''. The program shall have the following goals:
(1) Increase the understanding of physical and information
system disruptions to the energy infrastructure that could
result in cascading or widespread regional outages.
(2) Develop energy infrastructure assurance ``best
practices'' through vulnerability and risk assessments.
(3) Protect against, mitigate the effect of, and improve
the ability to recover from disruptive incidents within the
energy infrastructure.
(b) Program Scope.--The program under subsection (a) shall
include research, development, deployment, technology
demonstration for--
(1) analysis of energy infrastructure interdependencies to
quantify the impacts of system vulnerabilities in relation to
each other;
(2) probabilistic risk assessment of the energy
infrastructure to account for unconventional and terrorist
threats;
(3) incident tracking and trend analysis tools to assess
the severity of threats and reported incidents to the energy
infrastructure; and
(4) integrated multisensor, warning and mitigation
technologies to detect, integrate, and localize events
affecting the energy infrastructure including real time
control to permit the reconfiguration of energy delivery
systems.
(c) Regional Coordination.--The program under this section
shall cooperate with Departmental activities to promote
regional coordination under section 102 of this Act, to
ensure that the technologies and assessments developed by the
program are transferred in a timely manner to State and local
authorities, and to the energy industries.
(d) Coordination With Industry Research Organizations.--The
Secretary may enter into grants, contracts, and cooperative
agreements with industry research organizations to facilitate
industry participation in research under this section and to
fulfill applicable cost-sharing requirements.
(e) Authorization of Appropriations.--There is authorized
to be appropriated to the Secretary to carry out this
section--
(1) $25,000,000 for fiscal year 2003;
(2) $26,000,000 for fiscal year 2004;
(3) $27,000,000 for fiscal year 2005; and
(4) $28,000,000 for fiscal year 2006.
(f) Critical Energy Infrastructure Facility Defined.--For
purposes of this section, the term ``critical energy
infrastructure facility'' means a physical or cyber-based
system or service for the generation, transmission or
distribution of electrical energy, or the production,
refining, transportation, or storage of petroleum, natural
gas, or petroleum product, the incapacity or destruction of
which would have a debilitating impact on the defense or
economic security of the United States. The term shall not
include a facility that is licensed by the Nuclear Regulatory
Commission under section 103 or 104b of the Atomic Energy Act
of 1954 (42 U.S.C. 2133 and 2134(b)).

SEC. 1262. RESEARCH AND DEMONSTRATION FOR REMEDIATION OF
GROUNDWATER FROM ENERGY ACTIVITIES.

(a) In General.--The Secretary shall carry out a research,
development, demonstration, and technology deployment program
to improve methods for environmental restoration of
groundwater contaminated by energy activities, including oil
and gas production, surface and underground mining of coal,
and in-situ extraction of energy resources.
(b) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary to carry out this section
$10,000,000 for each of fiscal years 2003 through 2006.

TITLE XIII--CLIMATE CHANGE SCIENCE AND TECHNOLOGY

Subtitle A--Department of Energy Programs

SEC. 1301. DEPARTMENT OF ENERGY GLOBAL CHANGE RESEARCH.

(a) Program Direction.--The Secretary, acting through the
Office of Science, shall conduct a comprehensive research
program to understand and address the effects of energy
production and use on the global climate system.
(b) Program Elements.--
(1) Climate modeling.--The Secretary shall--
(A) conduct observational and analytical research to
acquire and interpret the data needed to describe the
radiation balance from the surface of the Earth to the top of
the atmosphere;
(B) determine the factors responsible for the Earth's
radiation balance and incorporate improved understanding of
such factors in climate models;
(C) improve the treatment of aerosols and clouds in climate
models;
(D) reduce the uncertainty in decade-to-century model-based
projections of climate change; and
(E) increase the availability and utility of climate change
simulations to researchers and policy makers interested in
assessing the relationship between energy and climate change.
(2) Carbon cycle.--The Secretary shall--
(A) carry out field research and modeling activities--
(i) to understand and document the net exchange of carbon
dioxide between major terrestrial ecosystems and the
atmosphere; or
(ii) to evaluate the potential of proposed methods of
carbon sequestration;
(B) develop and test carbon cycle models; and
(C) acquire data and develop and test models to simulate
and predict the transport, transformation, and fate of
energy-related emissions in the atmosphere.
(3) Ecological processes.--The Secretary shall carry out
long-term experiments of the response of intact terrestrial
ecosystems to--
(A) alterations in climate and atmospheric composition; or
(B) land-use changes that affect ecosystem extent and
function.
(4) Integrated assessment.--The Secretary shall develop and
improve methods and tools for integrated analyses of the
climate change system from emissions of aerosols and
greenhouse gases to the consequences of these emissions on
climate and the resulting effects of human-induced climate
change on economic and social systems, with emphasis on
critical gaps in integrated assessment modeling, including
modeling of technology innovation and diffusion and the
development of metrics of economic costs of climate change
and policies for mitigating or adapting to climate change.
(c) Authorization of Appropriations.--From amounts
authorized under section 1251(b), there are authorized to be
appropriated to the Secretary for carrying out activities
under this section--
(1) $150,000,000 for fiscal year 2003;
(2) $175,000,000 for fiscal year 2004;
(3) $200,000,000 for fiscal year 2005; and
(4) $230,000,000 for fiscal year 2006.-
(d) Limitation on Funds.--Funds authorized to be
appropriated under this section shall not be used for the
development, demonstration, or deployment of technology to
reduce, avoid, or sequester greenhouse gas emissions.

SEC. 1302. AMENDMENTS TO THE FEDERAL NONNUCLEAR RESEARCH AND
DEVELOPMENT ACT OF 1974.

Section 6 of the Federal Nonnuclear Energy Research and
Development Act of 1974 (42 U.S.C. 5905) is amended--
(1) in subsection (a)--
(A) in paragraph (2), by striking ``and'' at the end;
(B) in paragraph (3) by striking the period at the end and
inserting ``, and''; and
(C) by adding at the end the following:
``(4) solutions to the effective management of greenhouse
gas emissions in the long term by the development of
technologies and practices designed to--
``(A) reduce or avoid anthropogenic emissions of greenhouse
gases;
``(B) remove and sequester greenhouse gases from emissions
streams; and
``(C) remove and sequester greenhouse gases from the
atmosphere.''; and
(2) in subsection (b)--
(A) in paragraph (2), by striking ``subsection (a)(1)
through (3)'' and inserting ``paragraphs (1) through (4) of
subsection (a)''; and
(B) in paragraph (3)--
(i) in subparagraph (R), by striking ``and'' at the end;
(ii) in subparagraph (S), by striking the period at the end
and inserting ``; and''; and
(iii) by adding at the end the following:
``(T) to pursue a long-term climate technology strategy
designed to demonstrate a variety of technologies by which
stabilization of greenhouse gases might be best achieved,
including accelerated research, development, demonstration
and deployment of--
``(i) renewable energy systems;
``(ii) advanced fossil energy technology;
``(iii) advanced nuclear power plant design;
``(iv) fuel cell technology for residential, industrial and
transportation applications;
``(v) carbon sequestration practices and technologies,
including agricultural and forestry practices that store and
sequester carbon;
``(vi) efficient electrical generation, transmission and
distribution technologies; and
``(vii) efficient end use energy technologies.''.

Subtitle B--Department of Agriculture Programs

SEC. 1311. CARBON SEQUESTRATION BASIC AND APPLIED RESEARCH.

(a) Basic Research.--
(1) In general.--The Secretary of Agriculture shall carry
out research in the areas of soil science that promote
understanding of--
(A) the net sequestration of organic carbon in soil; and
(B) net emissions of other greenhouse gases from
agriculture.
(2) Agricultural research service.--The Secretary of
Agriculture, acting through the Agricultural Research
Service, shall collaborate with other Federal agencies in
developing data and carrying out research addressing soil
carbon fluxes (losses and gains) and net emissions of methane
and nitrous oxide from cultivation and animal management
activities.
(3) Cooperative state research, extension, and education
service.--
(A) In general.--The Secretary of Agriculture, acting
through the Cooperative State Research, Extension, and
Education Service, shall establish a competitive grant
program to carry out research on the matters described in
paragraph (1) in land grant universities and other research
institutions.
(B) Consultation on research topics.--Before issuing a
request for proposals for basic research under paragraph (1),
the Cooperative State Research, Extension, and Education
Service shall consult with the Agricultural Research

[[Page S10797]]

Service to ensure that proposed research areas are
complementary with and do not duplicate research projects
underway at the Agricultural Research Service or other
Federal agencies.
(b) Applied Research.--
(1) In general.--The Secretary of Agriculture shall carry
out applied research in the areas of soil science, agronomy,
agricultural economics and other agricultural sciences to--
(A) promote understanding of--
(i) how agricultural and forestry practices affect the
sequestration of organic and inorganic carbon in soil and net
emissions of other greenhouse gases;
(ii) how changes in soil carbon pools are cost-effectively
measured, monitored, and verified; and
(iii) how public programs and private market approaches can
be devised to incorporate carbon sequestration in a broader
societal greenhouse gas emission reduction effort;
(B) develop methods for establishing baselines for
measuring the quantities of carbon and other greenhouse gases
sequestered; and
(C) evaluate leakage and performance issues.
(2) Requirements.--To the maximum extent practicable,
applied research under paragraph (1) shall--
(A) draw on existing technologies and methods; and
(B) strive to provide methodologies that are accessible to
a nontechnical audience.
(3) Minimization of adverse environmental impacts.--All
applied research under paragraph (1) shall be conducted with
an emphasis on minimizing adverse environmental impacts.
(4) Natural resources conservation service.--The Secretary
of Agriculture, acting through the Natural Resources
Conservation Service, shall collaborate with other Federal
agencies, including the National Institute of Standards and
Technology, in developing new measuring techniques and
equipment or adapting existing techniques and equipment to
enable cost-effective and accurate monitoring and
verification, for a wide range of agricultural and forestry
practices, of--
(A) changes in soil carbon content in agricultural soils,
plants, and trees; and
(B) net emissions of other greenhouse gases.
(5) Cooperative state research, extension, and education
service.--
(A) In general.--The Secretary of Agriculture, acting
through the Cooperative State Research, Extension, and
Education Service, shall establish a competitive grant
program to encourage research on the matters described in
paragraph (1) by land grant universities and other research
institutions.
(B) Consultation on research topics.--Before issuing a
request for proposals for applied research under paragraph
(1), the Cooperative State Research, Extension, and Education
Service shall consult with the National Resources
Conservation Service and the Agricultural Research Service to
ensure that proposed research areas are complementary with
and do not duplicate research projects underway at the
Agricultural Research Service or other Federal agencies.
(c) Research Consortia.--
(1) In general.--The Secretary of Agriculture may designate
not more than two research consortia to carry out research
projects under this section, with the requirement that the
consortia propose to conduct basic research under subsection
(a) and applied research under subsection (b).
(2) Selection.--The consortia shall be selected in a
competitive manner by the Cooperative State Research,
Extension, and Education Service.
(3) Eligible consortium participants.--Entities eligible to
participate in a consortium include--
(A) land grant colleges and universities;
(B) private research institutions;
(C) State geological surveys;
(D) agencies of the Department of Agriculture;
(E) research centers of the National Aeronautics and Space
Administration and the Department of Energy;
(F) other Federal agencies;
(G) representatives of agricultural businesses and
organizations with demonstrated expertise in these areas; and
(H) representatives of the private sector with demonstrated
expertise in these areas.
(4) Reservation of funding.--If the Secretary of
Agriculture designates one or two consortia, the Secretary of
Agriculture shall reserve for research projects carried out
by the consortium or consortia not more than 25 percent of
the amounts made available to carry out this section for a
fiscal year.
(d) Standards of Precision.--
(1) Conference.--Not later than 3 years after the date of
enactment of this subtitle, the Secretary of Agriculture,
acting through the Agricultural Research Service and in
consultation with the Natural Resources Conservation Service,
shall convene a conference of key scientific experts on
carbon sequestration and measurement techniques from various
sectors (including the Government, academic, and private
sectors) to--
(A) discuss benchmark standards of precision for measuring
soil carbon content and net emissions of other greenhouse
gases;
(B) designate packages of measurement techniques and
modeling approaches to achieve a level of precision agreed on
by the participants in the conference; and
(C) evaluate results of analyses on baseline, permanence,
and leakage issues.
(2) Development of benchmark standards.--
(A) In general.--The Secretary shall develop benchmark
standards for measuring the carbon content of soils and
plants (including trees) based on--
(i) information from the conference under paragraph (1);
(ii) research conducted under this section; and
(iii) other information available to the Secretary.
(B) Opportunity for public comment.--The Secretary shall
provide an opportunity for the public to comment on benchmark
standards developed under subparagraph (A).
(3) Report.--Not later than 180 days after the conclusion
of the conference under paragraph (1), the Secretary of
Agriculture shall submit to the Committee on Agriculture of
the House of Representatives and the Committee on
Agriculture, Nutrition, and Forestry of the Senate a report
on the results of the conference.
(e) Authorization of Appropriations.--
(1) In general.--There are authorized to be appropriated to
carry out this section $25,000,000 for each of fiscal years
2003 through 2006.
(2) Allocation.--Of the amounts made available to carry out
this section for a fiscal year, at least 50 percent shall be
allocated for competitive grants by the Cooperative State
Research, Extension, and Education Service.

SEC. 1312. CARBON SEQUESTRATION DEMONSTRATION PROJECTS AND
OUTREACH.

(a) Demonstration Projects.--
(1) Development of monitoring programs.--
(A) In general.--The Secretary of Agriculture, acting
through the Natural Resources Conservation Service and in
cooperation with local extension agents, experts from land
grant universities, and other local agricultural or
conservation organizations, shall develop user-friendly
programs that combine measurement tools and modeling
techniques into integrated packages to monitor the carbon
sequestering benefits of conservation practices and net
changes in greenhouse gas emissions.
(B) Benchmark levels of precision.--The programs developed
under subparagraph (A) shall strive to achieve benchmark
levels of precision in measurement in a cost-effective
manner.
(2) Projects.--
(A) In general.--The Secretary of Agriculture, acting
through the Farm Service Agency, shall establish a program
under which projects use the monitoring programs developed
under paragraph (1) to demonstrate the feasibility of methods
of measuring, verifying, and monitoring--
(i) changes in organic carbon content and other carbon
pools in agricultural soils, plants, and trees; and
(ii) net changes in emissions of other greenhouse gases.
(B) Evaluation of implications.--The projects under
subparagraph (A) shall include evaluation of the implications
for reassessed baselines, carbon or other greenhouse gas
leakage, and permanence of sequestration.
(C) Submission of proposals.--Proposals for projects under
subparagraph (A) shall be submitted by the appropriate agency
of each State, in cooperation with interested local
jurisdictions and State agricultural and conservation
organizations.
(D) Limitation.--Not more than 10 projects under
subparagraph (A) may be approved in conjunction with applied
research projects under section 1311(b) until benchmark
measurement and assessment standards are established under
section 1311(d).
(E) National forest system land.--The Secretary of
Agriculture shall consider the use of National Forest System
land as sites to demonstrate the feasibility of monitoring
programs developed under paragraph (1).
(b) Outreach.--
(1) In general.--The Cooperative State Research, Extension,
and Education Service shall widely disseminate information
about the economic and environmental benefits that can be
generated by adoption of conservation practices (including
benefits from increased sequestration of carbon and reduced
emission of other greenhouse gases).
(2) Project results.--The Cooperative State Research,
Extension, and Education Service shall inform farmers,
ranchers, and State agricultural and energy offices in each
State of--
(A) the results of demonstration projects under subsection
(a)(2) in the State; and
(B) the ways in which the methods demonstrated in the
projects might be applicable to the operations of those
farmers and ranchers.
(3) Policy outreach.--On a periodic basis, the Cooperative
State Research, Extension, and Education Service shall
disseminate information on the policy nexus between global
climate change mitigation strategies and agriculture, so that
farmers and ranchers may better understand the global
implications of the activities of farmers and ranchers.
(c) Authorization of Appropriations.--
(1) In general.--There are authorized to be appropriated to
carry out this section $10,000,000 for each of fiscal years
2003 through 2006.
(2) Allocation.--Of the amounts made available to carry out
this section for a fiscal year, at least 50 percent shall be
allocated for demonstration projects under subsection (a)(2).

SEC. 1313. CARBON STORAGE AND SEQUESTRATION ACCOUNTING
RESEARCH.

(a) In General.--The Secretary of Agriculture, in
collaboration with the heads of other Federal agencies, shall
conduct research on, develop, and publish as appropriate,
carbon storage and sequestration accounting models, reference
tables, or other tools that can assist landowners and others
in cost-effective and reliable quantification of the carbon
release, sequestration, and storage expected to result from
various resource uses, land uses, practices, activities or
forest, agricultural, or cropland management practices over
various periods of time.
(b) Pilot Programs.--The Secretary of Agriculture shall
make competitive grants to not more than five eligible
entities to carry out pilot programs to demonstrate and
assess the potential for development and use of carbon
inventories and accounting systems that can assist in

[[Page S10798]]

developing and assessing carbon storage and sequestration
policies and programs. Not later than 1 year after the date
of enactment of this section, the Secretary of Agriculture,
in collaboration with the heads of other Federal agencies and
with other interested parties, shall develop guidelines for
such pilot programs, including eligibility for awards,
application contents, reporting requirements, and mechanisms
for peer review.
(c) Report.--Not later than 5 years after the date of
enactment of this section, the Secretary of Agriculture, in
collaboration with the heads of other Federal agencies, shall
submit to Congress a report on the technical, institutional,
infrastructure, design and funding needs to establish and
maintain a national carbon storage and sequestration baseline
and accounting system. The report shall include documentation
of the results of each of the pilot programs.
(d) Authorization of Appropriations.--For the purposes of
this section, there are authorized to be appropriated to the
Secretary of Agriculture $20,000,000 for fiscal years 2003
through 2007.

Subtitle C--International Energy Technology Transfer

SEC. 1321. CLEAN ENERGY TECHNOLOGY EXPORTS PROGRAM.

(a) Definitions.--In this section:
(1) Clean energy technology.--The term ``clean energy
technology'' means an energy supply or end-use technology
that, over its lifecycle and compared to a similar technology
already in commercial use in developing countries, countries
in transition, and other partner countries--
(A) emits substantially lower levels of pollutants or
greenhouse gases; and
(B) may generate substantially smaller or less toxic
volumes of solid or liquid waste.
(2) Interagency working group.--The term ``interagency
working group'' means the Interagency Working Group on Clean
Energy Technology Exports established under subsection (b).
(b) Interagency Working Group.--
(1) Establishment.--Not later than 90 days after the date
of enactment of this section, the Secretary of Energy, the
Secretary of Commerce, and the Administrator of the United
States Agency for International Development shall jointly
establish a Interagency Working Group on Clean Energy
Technology Exports. The interagency working group will focus
on opening and expanding energy markets and transferring
clean energy technology to the developing countries,
countries in transition, and other partner countries that are
expected to experience, over the next 20 years, the most
significant growth in energy production and associated
greenhouse gas emissions, including through technology
transfer programs under the Framework Convention on Climate
Change, other international agreements, and relevant Federal
efforts.
(2) Membership.--The interagency working group shall be
jointly chaired by representatives appointed by the agency
heads under paragraph (1) and shall also include
representatives from the Department of State, the Department
of the Treasury, the Environmental Protection Agency, the
Export-Import Bank, the Overseas Private Investment
Corporation, the Trade and Development Agency, and other
Federal agencies as deemed appropriate by all three agency
heads under paragraph (1).
(3) Duties.--The interagency working group shall--
(A) analyze technology, policy, and market opportunities
for international development, demonstration, and deployment
of clean energy technology;
(B) investigate issues associated with building capacity to
deploy clean energy technology in developing countries,
countries in transition, and other partner countries,
including--
(i) energy-sector reform;
(ii) creation of open, transparent, and competitive markets
for energy technologies;
(iii) availability of trained personnel to deploy and
maintain the technology; and
(iv) demonstration and cost-buydown mechanisms to promote
first adoption of the technology;
(C) examine relevant trade, tax, international, and other
policy issues to assess what policies would help open markets
and improve United States clean energy technology exports in
support of the following areas--
(i) enhancing energy innovation and cooperation, including
energy sector and market reform, capacity building, and
financing measures;
(ii) improving energy end-use efficiency technologies,
including buildings and facilities, vehicle, industrial, and
co-generation technology initiatives; and
(iii) promoting energy supply technologies, including
fossil, nuclear, and renewable technology initiatives;
(D) establish an advisory committee involving the private
sector and other interested groups on the export and
deployment of clean energy technology;
(E) monitor each agency's progress towards meeting goals in
the 5-year strategic plan submitted to Congress pursuant to
the Energy and Water Development Appropriations Act, 2001,
and the Energy and Water Development Appropriations Act,
2002;
(F) make recommendations to heads of appropriate Federal
agencies on ways to streamline Federal programs and policies
to improve each agency's role in the international
development, demonstration, and deployment of clean energy
technology;
(G) make assessments and recommendations regarding the
distinct technological, market, regional, and stakeholder
challenges necessary to carry out the program; and
(H) recommend conditions and criteria that will help ensure
that United States funds promote sound energy policies in
participating countries while simultaneously opening their
markets and exporting United States energy technology.
(c) Federal Support for Clean Energy Technology Transfer.--
Notwithstanding any other provision of law, each Federal
agency or Government corporation carrying out an assistance
program in support of the activities of United States persons
in the environment or energy sector of a developing country,
country in transition, or other partner country shall
support, to the maximum extent practicable, the transfer of
United States clean energy technology as part of that
program.
(d) Annual Report.--Not later than 90 days after the date
of the enactment of this Act, and on April 1st of each year
thereafter, the Interagency Working Group shall submit a
report to Congress on its activities during the preceding
calendar year. The report shall include a description of the
technology, policy, and market opportunities for
international development, demonstration, and deployment of
clean energy technology investigated by the Interagency
Working Group in that year, as well as any policy
recommendations to improve the expansion of clean energy
markets and United States clean energy technology exports.
(e) Report on Use of Funds.--Not later than October 1,
2002, and each year thereafter, the Secretary of State, in
consultation with other Federal agencies, shall submit a
report to Congress indicating how United States funds
appropriated for clean energy technology exports and other
relevant Federal programs are being directed in a manner that
promotes sound energy policy commitments in developing
countries, countries in transition, and other partner
countries, including efforts pursuant to multilateral
environmental agreements.
(f) Authorization of Appropriations.--There are authorized
to be appropriated to the departments, agencies, and entities
of the United States described in subsection (b) such sums as
may be necessary to support the transfer of clean energy
technology, consistent with the subsidy codes of the World
Trade Organization, as part of assistance programs carried
out by those departments, agencies, and entities in support
of activities of United States persons in the energy sector
of a developing country, country in transition, or other
partner country.

SEC. 1322. INTERNATIONAL ENERGY TECHNOLOGY DEPLOYMENT
PROGRAM.

Section 1608 of the Energy Policy Act of 1992 (42 U.S.C.
13387) is amended by striking subsection (l) and inserting
the following:
``(l) International Energy Technology Deployment Program.--
``(1) Definitions.--In this subsection:
``(A) International energy deployment project.--The term
`international energy deployment project' means a project to
construct an energy production facility outside the United
States--
``(i) the output of which will be consumed outside the
United States; and
``(ii) the deployment of which will result in a greenhouse
gas reduction per unit of energy produced when compared to
the technology that would otherwise be implemented--

``(I) 10 percentage points or more, in the case of a unit
placed in service before January 1, 2010;
``(II) 20 percentage points or more, in the case of a unit
placed in service after December 31, 2009, and before January
1, 2020; or
``(III) 30 percentage points or more, in the case of a unit
placed in service after December 31, 2019, and before January
1, 2030.

``(B) Qualifying international energy deployment project.--
The term `qualifying international energy deployment project'
means an international energy deployment project that--
``(i) is submitted by a United States firm to the Secretary
in accordance with procedures established by the Secretary by
regulation;
``(ii) uses technology that has been successfully developed
or deployed in the United States;
``(iii) meets the criteria of subsection (k);
``(iv) is approved by the Secretary, with notice of the
approval being published in the Federal Register; and
``(v) complies with such terms and conditions as the
Secretary establishes by regulation.
``(C) United states.--For purposes of this paragraph, the
term `United States', when used in a geographical sense,
means the 50 States, the District of Columbia, Puerto Rico,
Guam, the Virgin Islands, American Samoa, and the
Commonwealth of the Northern Mariana Islands.
``(2) Pilot program for financial assistance.--
``(A) In general.--Not later than 180 days after the date
of enactment of this subsection, the Secretary shall, by
regulation, provide for a pilot program for financial
assistance for qualifying international energy deployment
projects.
``(B) Selection criteria.--After consultation with the
Secretary of State, the Secretary of Commerce, and the United
States Trade Representative, the Secretary shall select
projects for participation in the program based solely on the
criteria under this title and without regard to the country
in which the project is located.
``(C) Financial assistance.--
``(i) In general.--A United States firm that undertakes a
qualifying international energy deployment project that is
selected to participate in the pilot program shall be
eligible to receive a loan or a loan guarantee from the
Secretary.
``(ii) Rate of interest.--The rate of interest of any loan
made under clause (i) shall be equal to the rate for Treasury
obligations then issued for periods of comparable maturities.
``(iii) Amount.--The amount of a loan or loan guarantee
under clause (i) shall not exceed 50 percent of the total
cost of the qualified international energy deployment
project.
``(iv) Developed countries.--Loans or loan guarantees made
for projects to be located in a developed country, as listed
in Annex I of the

[[Page S10799]]

United Nations Framework Convention on Climate Change, shall
require at least a 50 percent contribution towards the total
cost of the loan or loan guarantee by the host country.
``(v) Developing countries.--Loans or loan guarantees made
for projects to be located in a developing country (those
countries not listed in Annex I of the United Nations
Framework Convention on Climate Change) shall require at
least a 10 percent contribution towards the total cost of the
loan or loan guarantee by the host country.
``(vi) Capacity building research.--Proposals made for
projects to be located in a developing country may include a
research component intended to build technological capacity
within the host country. Such research must be related to the
technologies being deployed and must involve both an
institution in the host country and an industry, university
or national laboratory participant from the United States.
The host institution shall contribute at least 50 percent of
funds provided for the capacity building research.
``(D) Coordination with other programs.--A qualifying
international energy deployment project funded under this
section shall not be eligible as a qualifying clean coal
technology under section 415 of the Clean Air Act (42 U.S.C.
7651n).
``(E) Report.--Not later than 5 years after the date of
enactment of this subsection, the Secretary shall submit to
the President a report on the results of the pilot projects.
``(F) Recommendation.--Not later than 60 days after
receiving the report under subparagraph (E), the President
shall submit to Congress a recommendation, based on the
results of the pilot projects as reported by the Secretary of
Energy, concerning whether the financial assistance program
under this section should be continued, expanded, reduced, or
eliminated.
``(3) Authorization of appropriations.--There are
authorized to be appropriated to the Secretary to carry out
this section $100,000,000 for each of fiscal years 2003
through 2011, to remain available until expended.''.

Subtitle D--Climate Change Science and Information

PART I--AMENDMENTS TO THE GLOBAL CHANGE RESEARCH ACT OF 1990

SEC. 1331. AMENDMENT OF GLOBAL CHANGE RESEARCH ACT OF 1990.

Except as otherwise expressly provided, whenever in this
subtitle 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 Global Change Research Act of 1990 (15
U.S.C. 2921 et seq.).

SEC. 1332. CHANGES IN DEFINITIONS.

Paragraph (1) of section 2 (15 U.S.C. 2921) is amended by
striking ``Earth and Environmental Sciences'' inserting
``Global Change Research''.

SEC. 1333. CHANGE IN COMMITTEE NAME AND STRUCTURE.

Section 102 (15 U.S.C. 2932) is amended--
(1) by striking ``EARTH AND ENVIRONMENTAL SCIENCES'' in the
section heading and inserting ``GLOBAL CHANGE RESEARCH'';
(2) by striking ``Earth and Environmental Sciences'' in
subsection (a) and inserting ``Global Change Research'';
(3) by striking the last sentence of subsection (b) and
inserting ``The representatives shall be the Deputy Secretary
or the Deputy Secretary's designee (or, in the case of an
agency other than a department, the deputy head of that
agency or the deputy's designee).'';
(4) by striking ``Chairman of the Council,'' in subsection
(c) and inserting ``Director of the Office of National
Climate Change Policy with advice from the Chairman of the
Council, and'';
(5) by redesignating subsections (d) and (e) as subsections
(e) and (f), respectively; and
(6) by inserting after subsection (c) the following:
``(d) Subcommittees and Working Groups.--
``(1) In general.--There shall be a Subcommittee on Global
Change Research, which shall carry out such functions of the
Committee as the Committee may assign to it.
``(2) Membership.--The membership of the Subcommittee shall
consist of--
``(A) the membership of the Subcommittee on Global Change
Research of the Committee on Environment and Natural
Resources (the functions of which are transferred to the
Subcommittee established by this subsection) established by
the National Science and Technology Council; and
``(B) such additional members as the Chair of the Committee
may, from time to time, appoint.
``(3) Chair.--A high ranking official of one of the
departments or agencies described in subsection (b),
appointed by the Chair of the Committee with advice from the
Chairman of the Council, shall chair the subcommittee. The
Chairperson shall be knowledgeable and experienced with
regard to the administration of scientific research programs,
and shall be a representative of an agency that contributes
substantially, in terms of scientific research capability and
budget, to the Program.
``(4) Other subcommittees and working groups.--The
Committee may establish such additional subcommittees and
working groups as it sees fit.''.

SEC. 1334. CHANGE IN NATIONAL GLOBAL CHANGE RESEARCH PLAN.

Section 104 (15 U.S.C. 2934) is amended--
(1) by inserting ``short-term and long-term'' before
``goals'' in subsection (b)(1);
(2) by striking ``usable information on which to base
policy decisions related to'' in subsection (b)(1) and
inserting ``information relevant and readily usable by local,
State, and Federal decisionmakers, as well as other end-
users, for the formulation of effective decisions and
strategies for measuring, predicting, preventing, mitigating,
and adapting to'';
(3) by adding at the end of subsection (c) the following:
``(6) Methods for integrating information to provide
predictive and other tools for planning and decisionmaking by
governments, communities and the private sector.'';
(4) by striking subsection (d)(3) and inserting the
following:
``(3) combine and interpret data from various sources to
produce information readily usable by local, State, and
Federal policymakers, and other end-users, attempting to
formulate effective decisions and strategies for preventing,
mitigating, and adapting to the effects of global change.'';
(5) by striking ``and'' in subsection (d)(2);
(6) by striking ``change.'' in subsection (d)(3) and
inserting ``change; and'';
(7) by adding at the end of subsection (d) the following:
``(4) establish a common assessment and modeling framework
that may be used in both research and operations to predict
and assess the vulnerability of natural and managed
ecosystems and of human society in the context of other
environmental and social changes.''; and
(8) by adding at the end the following:
``(g) Strategic Plan; Revised Implementation Plan.--The
Chairman of the Council, through the Committee, shall develop
a strategic plan for the United States Global Climate Change
Research Program for the 10-year period beginning in 2002 and
submit the plan to the Congress within 180 days after the
date of enactment of the Global Climate Change Act of 2002.
The Chairman, through the Committee, shall also submit
revised implementation plans as required under subsection
(a).''.

SEC. 1335. INTEGRATED PROGRAM OFFICE.

Section 105 (15 U.S.C. 2935) is amended--
(1) by redesignating subsections (a), (b), and (c) as
subsections (b), (c), and (d), respectively; and
(2) by inserting before subsection (b), as redesignated,
the following:
``(a) Integrated Program Office.--
``(1) Establishment.--There is established in the Office of
Science and Technology Policy an integrated program office
for the global change research program.
``(2) Organization.--The integrated program office
established under paragraph (1) shall be headed by the
associate director with responsibility for climate change
science and technology and shall include, to the maximum
extent feasible, a representative from each Federal agency
participating in the global change research program.
``(3) Function.--The integrated program office shall--
``(A) manage, working in conjunction with the Committee,
interagency coordination and program integration of global
change research activities and budget requests;
``(B) ensure that the activities and programs of each
Federal agency or department participating in the program
address the goals and objectives identified in the strategic
research plan and interagency implementation plans;
``(C) ensure program and budget recommendations of the
Committee are communicated to the President and are
integrated into the climate change action strategy;
``(D) review, solicit, and identify, and allocate funds
for, partnership projects that address critical research
objectives or operational goals of the program, including
projects that would fill research gaps identified by the
program, and for which project resources are shared among at
least two agencies participating in the program; and
``(E) review and provide recommendations on, in conjunction
with the Committee, all annual appropriations requests from
Federal agencies or departments participating in the
program.'';
(3) by striking ``Committee.'' in paragraph (2) of
subsection (c), as redesignated, and inserting ``Committee
and the Integrated Program Office.''; and
(4) by inserting ``and the Integrated Program Office''
after ``Committee'' in paragraph (1) of subsection (d), as
redesignated.

SEC. 1336. RESEARCH GRANTS.

Section 105 (15 U.S.C. 2935) is amended--
(1) by redesignating subsection (c) as subsection (d); and
(2) by inserting after subsection (b) the following:
``(c) Research Grants.--
``(1) Committee to develop list of priority research
areas.--The Committee shall develop a list of priority areas
for research and development on climate change that are not
being addressed by Federal agencies.
``(2) Director of ostp to transmit list to nsf.--The
Director of the Office of Science and Technology Policy shall
transmit the list to the National Science Foundation.
``(3) Funding through nsf.--
``(A) Budget request.--The National Science Foundation
shall include, as part of the annual request for
appropriations for the Science and Technology Policy
Institute, a request for appropriations to fund research in
the priority areas on the list developed under paragraph (1).
``(B) Authorization.--For fiscal year 2003 and each fiscal
year thereafter, there are authorized to be appropriated to
the National Science Foundation not less than $17,000,000, to
be made available through the Science and Technology Policy
Institute, for research in those priority areas.''.

SEC. 1337. EVALUATION OF INFORMATION.

Section 106 (15 U.S.C. 2936) is amended--
(1) by striking ``Scientific'' in the section heading;
(2) by striking ``and'' after the semicolon in paragraph
(2); and
(3) by striking ``years.'' in paragraph (3) and inserting
``years; and''; and

[[Page S10800]]

(4) by adding at the end the following:
``(4) evaluates the information being developed under this
title, considering in particular its usefulness to local,
State, and national decisionmakers, as well as to other
stakeholders such as the private sector, after providing a
meaningful opportunity for the consideration of the views of
such stakeholders on the effectiveness of the Program and the
usefulness of the information.''.

PART II--NATIONAL CLIMATE SERVICES AND MONITORING

SEC. 1341. AMENDMENT OF NATIONAL CLIMATE PROGRAM ACT.

Except as otherwise expressly provided, whenever in this
subtitle 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 National Climate Program Act (15
U.S.C. 2901 et seq.).

SEC. 1342. CHANGES IN FINDINGS.

Section 2 (15 U.S.C. 2901) is amended--
(1) by striking ``Weather and climate change affect'' in
paragraph (1) and inserting ``Weather, climate change, and
climate variability affect public safety, environmental
security, human health,'';
(2) by striking ``climate'' in paragraph (2) and inserting
``climate, including seasonal and decadal fluctuations,'';
(3) by striking ``changes.'' in paragraph (5) and inserting
``changes and providing free exchange of meteorological
data.''; and
(4) by adding at the end the following:
``(7) The present rate of advance in research and
development and application of such advances is inadequate
and new developments must be incorporated rapidly into
services for the benefit of the public.
``(8) The United States lacks adequate infrastructure and
research to meet national climate monitoring and prediction
needs.''.

SEC. 1343. TOOLS FOR REGIONAL PLANNING.

Section 5(d) (15 U.S.C. 2904(d)) is amended--
(1) by redesignating paragraphs (4) through (9) as
paragraphs (5) through (10), respectively;
(2) by inserting after paragraph (3) the following:
``(4) methods for improving modeling and predictive
capabilities and developing assessment methods to guide
national, regional, and local planning and decisionmaking on
land use, water hazards, and related issues;'';
(3) by inserting ``sharing,'' after ``collection,'' in
paragraph (5), as redesignated;
(4) by striking ``experimental'' each place it appears in
paragraph (9), as redesignated;
(5) by striking ``preliminary'' in paragraph (10), as
redesignated;
(6) by striking ``this Act,'' the first place it appears in
paragraph (10), as redesignated, and inserting ``the Global
Climate Change Act of 2002,''; and
(7) by striking ``this Act,'' the second place it appears
in paragraph (10), as redesignated, and inserting ``that
Act,''.

SEC. 1344. AUTHORIZATION OF APPROPRIATIONS.

Section 9 (15 U.S.C. 2908) is amended--
(1) by striking ``1979,'' and inserting ``2002,'';
(2) by striking ``1980,'' and inserting ``2003,'';
(3) by striking ``1981,'' and inserting ``2004,''; and
(4) by striking ``$25,500,000'' and inserting
``$75,500,000''.

SEC. 1345. NATIONAL CLIMATE SERVICE PLAN.

The Act (15 U.S.C. 2901 et seq.) is amended by inserting
after section 5 the following:

``SEC. 6. NATIONAL CLIMATE SERVICE PLAN.

``Within 1 year after the date of enactment of the Global
Climate Change Act of 2002, the Secretary of Commerce shall
submit to the Senate Committee on Commerce, Science, and
Transportation and the House Science Committee a plan of
action for a National Climate Service under the National
Climate Program. The plan shall set forth recommendations and
funding estimates for--
``(1) a national center for operational climate monitoring
and predicting with the functional capacity to monitor and
adjust observing systems as necessary to reduce bias;
``(2) the design, deployment, and operation of an adequate
national climate observing system that builds upon existing
environmental monitoring systems and closes gaps in coverage
by existing systems;
``(3) the establishment of a national coordinated modeling
strategy, including a national climate modeling center to
provide a dedicated capability for climate modeling and a
regular schedule of projections on a long- and short-term
time schedule and at a range of spatial scales;
``(4) improvements in modeling and assessment capabilities
needed to integrate information to predict regional and local
climate changes and impacts;
``(5) in coordination with the private sector, improving
the capacity to assess the impacts of predicted and projected
climate changes and variations;
``(6) a program for long-term stewardship, quality control,
development of relevant climate products, and efficient
access to all relevant climate data, products, and critical
model simulations; and
``(7) mechanisms to coordinate among Federal agencies,
State, and local government entities and the academic
community to ensure timely and full sharing and dissemination
of climate information and services, both domestically and
internationally.''.

SEC. 1346. INTERNATIONAL PACIFIC RESEARCH AND COOPERATION.

The Secretary of Commerce, in cooperation with the
Administrator of the National Aeronautics and Space
Administration, shall conduct international research in the
Pacific region that will increase understanding of the nature
and predictability of climate variability in the Asia-Pacific
sector, including regional aspects of global environmental
change. Such research activities shall be conducted in
cooperation with other nations of the region. There are
authorized to be appropriated for purposes of this section
$1,500,000 to the National Oceanic and Atmospheric
Administration, $1,500,000 to the National Aeronautics and
Space Administration, and $500,000 for the Pacific ENSO
Applications Center.

SEC. 1347. REPORTING ON TRENDS.

(a) Atmospheric Monitoring and Verification Program.--The
Secretary of Commerce, in coordination with relevant Federal
agencies, shall, as part of the National Climate Service,
establish an atmospheric monitoring and verification program
utilizing aircraft, satellite, ground sensors, and modeling
capabilities to monitor, measure, and verify atmospheric
greenhouse gas levels, dates, and emissions. Where feasible,
the program shall measure emissions from identified sources
participating in the reporting system for verification
purposes. The program shall use measurements and standards
that are consistent with those utilized in the greenhouse gas
measurement and reporting system established under subsection
(a) and the registry established under section 1102.
(b) Annual Reporting.--The Secretary of Commerce shall
issue an annual report that identifies greenhouse emissions
and trends on a local, regional, and national level. The
report shall also identify emissions or reductions
attributable to individual or multiple sources covered by the
greenhouse gas measurement and reporting system established
under section 1102.

SEC. 1348. ARCTIC RESEARCH AND POLICY.

(a) Arctic Research Commission.--Section 103(d) of the
Arctic Research and Policy Act of 1984 (15 U.S.C. 4102(d)) is
amended--
(1) by striking ``exceed 90 days'' in the second sentence
of paragraph (1) and inserting ``exceed, in the case of the
chairperson of the Commission, 120 days, and, in the case of
any other member of the Commission, 90 days,'';
(2) by striking ``Chairman'' in paragraph (2) and inserting
``chairperson''.
(b) Grants.--Section 104 of the Arctic Research and Policy
Act of 1984 (15 U.S.C. 4103) is amended by adding at the end
the following:
``(c) Funding for Arctic Research.--
``(1) In general.--With the prior approval of the
commission, or under authority delegated by the Commission,
and subject to such conditions as the Commission may specify,
the Executive Director appointed under section 106(a) may--
``(A) make grants to persons to conduct research concerning
the Arctic; and
``(B) make funds available to the National Science
Foundation or to Federal agencies for the conduct of research
concerning the Arctic.
``(2) Effect of action by executive director.--An action
taken by the executive director under paragraph (1) shall be
final and binding on the Commission.
``(3) Authorization of appropriations.--There are
authorized to be appropriated to the Commission such sums as
are necessary to carry out this section.''.

SEC. 1349. ABRUPT CLIMATE CHANGE RESEARCH.

(a) In General.--The Secretary of Commerce, through the
National Oceanic and Atmospheric Administration, shall carry
out a program of scientific research on potential abrupt
climate change designed--
(1) to develop a global array of terrestrial and
oceanographic indicators of paleoclimate in order
sufficiently to identify and describe past instances of
abrupt climate change;
(2) to improve understanding of thresholds and
nonlinearities in geophysical systems related to the
mechanisms of abrupt climate change;
(3) to incorporate these mechanisms into advanced
geophysical models of climate change; and
(4) to test the output of these models against an improved
global array of records of past abrupt climate changes.
(b) Abrupt Climate Change Defined.--In this section, the
term ``abrupt climate change'' means a change in climate that
occurs so rapidly or unexpectedly that human or natural
systems may have difficulty adapting to it.
(c) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary of Commerce $10,000,000
for each of the fiscal years 2003 through 2008, and such sums
as may be necessary for fiscal years after fiscal year 2008,
to carry out subsection (a).

PART III--OCEAN AND COASTAL OBSERVING SYSTEM

SEC. 1351. OCEAN AND COASTAL OBSERVING SYSTEM.

(a) Establishment.--The President, through the National
Ocean Research Leadership Council, established by section
7902(a) of title 10, United States Code, shall establish and
maintain an integrated ocean and coastal observing system
that provides for long-term, continuous, and real-time
observations of the oceans and coasts for the purposes of--
(1) understanding, assessing and responding to human-
induced and natural processes of global change;
(2) improving weather forecasts and public warnings;
(3) strengthening national security and military
preparedness;
(4) enhancing the safety and efficiency of marine
operations;
(5) supporting efforts to restore the health of and manage
coastal and marine ecosystems and living resources;
(6) monitoring and evaluating the effectiveness of ocean
and coastal environmental policies;
(7) reducing and mitigating ocean and coastal pollution;
and

[[Page S10801]]

(8) providing information that contributes to public
awareness of the state and importance of the oceans.
(b) Council Functions.--In addition to its responsibilities
under section 7902(a) of such title, the Council shall be
responsible for planning and coordinating the observing
system and in carrying out this responsibility shall--
(1) develop and submit to the Congress, within 6 months
after the date of enactment of this Act, a plan for
implementing a national ocean and coastal observing system
that--
(A) uses an end-to-end engineering and development approach
to develop a system design and schedule for operational
implementation;
(B) determines how current and planned observing activities
can be integrated in a cost-effective manner;
(C) provides for regional and concept demonstration
projects;
(D) describes the role and estimated budget of each Federal
agency in implementing the plan;
(E) contributes, to the extent practicable, to the National
Global Change Research Plan under section 104 of the Global
Change Research Act of 1990 (15 U.S.C. 2934); and
(F) makes recommendations for coordination of ocean
observing activities of the United States with those of other
nations and international organizations;
(2) serve as the mechanism for coordinating Federal ocean
observing requirements and activities;
(3) work with academic, State, industry and other actual
and potential users of the observing system to make effective
use of existing capabilities and incorporate new
technologies;
(4) approve standards and protocols for the administration
of the system, including--
(A) a common set of measurements to be collected and
distributed routinely and by uniform methods;
(B) standards for quality control and assessment of data;
(C) design, testing and employment of forecast models for
ocean conditions;
(D) data management, including data transfer protocols and
archiving; and
(E) designation of coastal ocean observing regions; and
(5) in consultation with the Secretary of State, provide
representation at international meetings on ocean observing
programs and coordinate relevant Federal activities with
those of other nations.
(c) System Elements.--The integrated ocean and coastal
observing system shall include the following elements:
(1) A nationally coordinated network of regional coastal
ocean observing systems that measure and disseminate a common
set of ocean observations and related products in a uniform
manner and according to sound scientific practice, but that
are adapted to local and regional needs.
(2) Ocean sensors for climate observations, including the
Arctic Ocean and sub-polar seas.
(3) Coastal, relocatable, and cabled sea floor
observatories.
(4) Broad bandwidth communications that are capable of
transmitting high volumes of data from open ocean locations
at low cost and in real time.
(5) Ocean data management and assimilation systems that
ensure full use of new sources of data from space-borne and
in situ sensors.
(6) Focused research programs.
(7) Technology development program to develop new observing
technologies and techniques, including data management and
dissemination.
(8) Public outreach and education.

SEC. 1352. AUTHORIZATION OF APPROPRIATIONS.

For development and implementation of an integrated ocean
and coastal observation system under this title, including
financial assistance to regional coastal ocean observing
systems, there are authorized to be appropriated $235,000,000
in fiscal year 2003, $315,000,000 in fiscal year 2004,
$390,000,000 in fiscal year 2005, and $445,000,000 in fiscal
year 2006.

Subtitle E--Climate Change Technology

SEC. 1361. NIST GREENHOUSE GAS FUNCTIONS.

Section 2(c) of the National Institute of Standards and
Technology Act (15 U.S.C. 272(c)) is amended--
(1) by striking ``and'' after the semicolon in paragraph
(21);
(2) by redesignating paragraph (22) as paragraph (23); and
(3) by inserting after paragraph (21) the following:
``(22) perform research to develop enhanced measurements,
calibrations, standards, and technologies which will enable
the reduced production in the United States of greenhouse
gases associated with global warming, including carbon
dioxide, methane, nitrous oxide, ozone, perfluorocarbons,
hydrofluorocarbons, and sulfur hexafluoride; and''.

SEC. 1362. DEVELOPMENT OF NEW MEASUREMENT TECHNOLOGIES.

The Secretary of Commerce shall initiate a program to
develop, with technical assistance from appropriate Federal
agencies, innovative standards and measurement technologies
(including technologies to measure carbon changes due to
changes in land use cover) to calculate--
(1) greenhouse gas emissions and reductions from
agriculture, forestry, and other land use practices;
(2) noncarbon dioxide greenhouse gas emissions from
transportation;
(3) greenhouse gas emissions from facilities or sources
using remote sensing technology; and
(4) any other greenhouse gas emission or reductions for
which no accurate or reliable measurement technology exists.

SEC. 1363. ENHANCED ENVIRONMENTAL MEASUREMENTS AND STANDARDS.

The National Institute of Standards and Technology Act (15
U.S.C. 271 et seq.) is amended--
(1) by redesignating sections 17 through 32 as sections 18
through 33, respectively; and
(2) by inserting after section 16 the following:

``SEC. 17. CLIMATE CHANGE STANDARDS AND PROCESSES.

``(a) In General.--The Director shall establish within the
Institute a program to perform and support research on global
climate change standards and processes, with the goal of
providing scientific and technical knowledge applicable to
the reduction of greenhouse gases (as defined in section 4 of
the Global Climate Change Act of 2002).
``(b) Research Program.--
``(1) In general.--The Director is authorized to conduct,
directly or through contracts or grants, a global climate
change standards and processes research program.
``(2) Research projects.--The specific contents and
priorities of the research program shall be determined in
consultation with appropriate Federal agencies, including the
Environmental Protection Agency, the National Oceanic and
Atmospheric Administration, and the National Aeronautics and
Space Administration. The program generally shall include
basic and applied research--
``(A) to develop and provide the enhanced measurements,
calibrations, data, models, and reference material standards
which will enable the monitoring of greenhouse gases;
``(B) to assist in establishing a baseline reference point
for future trading in greenhouse gases and the measurement of
progress in emissions reduction;
``(C) that will be exchanged internationally as scientific
or technical information which has the stated purpose of
developing mutually recognized measurements, standards, and
procedures for reducing greenhouse gases; and
``(D) to assist in developing improved industrial processes
designed to reduce or eliminate greenhouse gases.
``(c) National Measurement Laboratories.--
``(1) In general.--In carrying out this section, the
Director shall utilize the collective skills of the National
Measurement Laboratories of the National Institute of
Standards and Technology to improve the accuracy of
measurements that will permit better understanding and
control of these industrial chemical processes and result in
the reduction or elimination of greenhouse gases.
``(2) Material, process, and building research.--The
National Measurement Laboratories shall conduct research
under this subsection that includes--
``(A) developing material and manufacturing processes which
are designed for energy efficiency and reduced greenhouse gas
emissions into the environment;
``(B) developing environmentally-friendly, `green' chemical
processes to be used by industry; and
``(C) enhancing building performance with a focus in
developing standards or tools which will help incorporate
low- or no-emission technologies into building designs.
``(3) Standards and tools.--The National Measurement
Laboratories shall develop standards and tools under this
subsection that include software to assist designers in
selecting alternate building materials, performance data on
materials, artificial intelligence-aided design procedures
for building subsystems and `smart buildings', and improved
test methods and rating procedures for evaluating the energy
performance of residential and commercial appliances and
products.
``(d) National Voluntary Laboratory Accreditation
Program.--The Director shall utilize the National Voluntary
Laboratory Accreditation Program under this section to
establish a program to include specific calibration or test
standards and related methods and protocols assembled to
satisfy the unique needs for accreditation in measuring the
production of greenhouse gases. In carrying out this
subsection the Director may cooperate with other departments
and agencies of the Federal Government, State and local
governments, and private organizations.''.

SEC. 1364. TECHNOLOGY DEVELOPMENT AND DIFFUSION.

The Director of the National Institute of Standards and
Technology, through the Manufacturing Extension Partnership
Program, may develop a program to support the implementation
of new ``green'' manufacturing technologies and techniques by
the more than 380,000 small manufacturers.

SEC. 1365. AUTHORIZATION OF APPROPRIATIONS.

There are authorized to be appropriated to the Director to
carry out functions pursuant to sections 1345, 1351, and 1361
through 1363, $10,000,000 for fiscal years 2002 through 2006.

Subtitle F--Climate Adaptation and Hazards Prevention

PART I--ASSESSMENT AND ADAPTATION

SEC. 1371. REGIONAL CLIMATE ASSESSMENT AND ADAPTATION
PROGRAM.

(a) In General.--The President shall establish within the
Department of Commerce a National Climate Change
Vulnerability and Adaptation Program for regional impacts
related to increasing concentrations of greenhouse gases in
the atmosphere and climate variability.
(b) Coordination.--In designing such program the Secretary
shall consult with the Federal Emergency Management Agency,
the Environmental Protection Agency, the Army Corps of
Engineers, the Department of Transportation, and other
appropriate Federal, State, and local government entities.
(c) Vulnerability Assessments.--The program shall--
(1) evaluate, based on predictions and other information
developed under this Act and the National Climate Program Act
(15 U.S.C. 2901 et

[[Page S10802]]

seq.), regional vulnerability to phenomena associated with
climate change and climate variability, including--
(A) increases in severe weather events;
(B) sea level rise and shifts in the hydrological cycle;
(C) natural hazards, including tsunami, drought, flood and
fire; and
(D) alteration of ecological communities, including at the
ecosystem or watershed levels; and
(2) build upon predictions and other information developed
in the National Assessments prepared under the Global Change
Research Act of 1990 (15 U.S.C. 2921 et seq.).
(d) Preparedness Recommendations.--The program shall submit
a report to Congress within 2 years after the date of
enactment of this Act that identifies and recommends
implementation and funding strategies for short- and long-
term actions that may be taken at the national, regional,
State, and local level--
(1) to reduce vulnerability of human life and property;
(2) to improve resilience to hazards;
(3) to minimize economic impacts; and
(4) to reduce threats to critical biological and ecological
processes.
(e) Information and Technology.--The Secretary shall make
available appropriate information and other technologies and
products that will assist national, regional, State, and
local efforts, as well as efforts by other end-users, to
reduce loss of life and property, and coordinate
dissemination of such technologies and products.
(f) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary of Commerce $4,500,000 to
implement the requirements of this section.

SEC. 1372. COASTAL VULNERABILITY AND ADAPTATION.

(a) Coastal Vulnerability.--Within 2 years after the date
of enactment of this Act, the Secretary shall, in
consultation with the appropriate Federal, State, and local
governmental entities, conduct regional assessments of the
vulnerability of coastal areas to hazards associated with
climate change, climate variability, sea level rise, and
fluctuation of Great Lakes water levels. The Secretary may
also establish, as warranted, longer term regional assessment
programs. The Secretary may also consult with the governments
of Canada and Mexico as appropriate in developing such
regional assessments. In preparing the regional assessments,
the Secretary shall collect and compile current information
on climate change, sea level rise, natural hazards, and
coastal erosion and mapping, and specifically address impacts
on Arctic regions and the Central, Western, and South Pacific
regions. The regional assessments shall include an evaluation
of--
(1) social impacts associated with threats to and potential
losses of housing, communities, and infrastructure;
(2) physical impacts such as coastal erosion, flooding and
loss of estuarine habitat, saltwater intrusion of aquifers
and saltwater encroachment, and species migration; and
(3) economic impact on local, State, and regional
economies, including the impact on abundance or distribution
of economically important living marine resources.
(b) Coastal Adaptation Plan.--The Secretary shall, within 3
years after the date of enactment of this Act, submit to the
Congress a national coastal adaptation plan, composed of
individual regional adaptation plans that recommend targets
and strategies to address coastal impacts associated with
climate change, sea level rise, or climate variability. The
plan shall be developed with the participation of other
Federal, State, and local government agencies that will be
critical in the implementation of the plan at the State and
local levels. The regional plans that will make up the
national coastal adaptation plan shall be based on the
information contained in the regional assessments and shall
identify special needs associated with Arctic areas and the
Central, Western, and South Pacific regions. The Plan shall
recommend both short- and long-term adaptation strategies and
shall include recommendations regarding--
(1) Federal flood insurance program modifications;
(2) areas that have been identified as high risk through
mapping and assessment;
(3) mitigation incentives such as rolling easements,
strategic retreat, State or Federal acquisition in fee simple
or other interest in land, construction standards, and
zoning;
(4) land and property owner education;
(5) economic planning for small communities dependent upon
affected coastal resources, including fisheries; and
(6) funding requirements and mechanisms.
(c) Technical Planning Assistance.--The Secretary, through
the National Ocean Service, shall establish a coordinated
program to provide technical planning assistance and products
to coastal States and local governments as they develop and
implement adaptation or mitigation strategies and plans.
Products, information, tools and technical expertise
generated from the development of the regional assessments
and the regional adaptation plans will be made available to
coastal States for the purposes of developing their own State
and local plans.
(d) Coastal Adaptation Grants.--The Secretary shall provide
grants of financial assistance to coastal States with
federally approved coastal zone management programs to
develop and begin implementing coastal adaptation programs if
the State provides a Federal-to-State match of 4 to 1 in the
first fiscal year, 2.3 to 1 in the second fiscal year, 2 to 1
in the third fiscal year, and 1 to 1 thereafter. Distribution
of these funds to coastal States shall be based upon the
formula established under section 306(c) of the Coastal Zone
Management Act of 1972 (16 U.S.C. 1455(c)), adjusted in
consultation with the States as necessary to provide
assistance to particularly vulnerable coastlines.
(e) Coastal Response Pilot Program.--
(1) In general.--The Secretary shall establish a 4-year
pilot program to provide financial assistance to coastal
communities most adversely affected by the impact of climate
change or climate variability that are located in States with
federally approved coastal zone management programs.
(2) Eligible projects.--A project is eligible for financial
assistance under the pilot program if it--
(A) will restore or strengthen coastal resources,
facilities, or infrastructure that have been damaged by such
an impact, as determined by the Secretary;
(B) meets the requirements of the Coastal Zone Management
Act (16 U.S.C. 1451 et seq.) and is consistent with the
coastal zone management plan of the State in which it is
located; and
(C) will not cost more than $100,000.
(3) Funding share.--The Federal funding share of any
project under this subsection may not exceed 75 percent of
the total cost of the project. In the administration of this
paragraph--
(A) the Secretary may take into account in-kind
contributions and other noncash support of any project to
determine the Federal funding share for that project; and
(B) the Secretary may waive the requirements of this
paragraph for a project in a community if--
(i) the Secretary determines that the project is important;
and
(ii) the economy and available resources of the community
in which the project is to be conducted are insufficient to
meet the non-Federal share of the project's costs.
(f) Definitions.--Any term used in this section that is
defined in section 304 of the Coastal Zone Management Act of
1972 (16 U.S.C. 1453) has the meaning given it by that
section.
(g) Authorization of Appropriations.--There are authorized
to be appropriated $3,000,000 annually for regional
assessments under subsection (a), and $3,000,000 annually for
coastal adaptation grants under subsection (d).

SEC. 1373. ARCTIC RESEARCH CENTER.

(a) Establishment.--The Secretary of Commerce, in
consultation with the Secretaries of Energy and the Interior,
the Director of the National Science Foundation, and the
Administrator of the Environmental Protection Agency, shall
establish a joint research facility, to be known as the
Barrow Arctic Research Center, to support climate change and
other scientific research activities in the Arctic.
(b) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretaries of Commerce, Energy,
and the Interior, the Director of the National Science
Foundation, and the Administrator of the Environmental
Protection Agency, $35,000,000 for the planning, design,
construction, and support of the Barrow Arctic Research
Center.

PART II--FORECASTING AND PLANNING PILOT PROGRAMS

SEC. 1381. REMOTE SENSING PILOT PROJECTS.

(a) In General.--The Administrator of the National
Aeronautics and Space Administration may establish, through
the National Oceanic and Atmospheric Administration's Coastal
Services Center, a program of grants for competitively
awarded pilot projects to explore the integrated use of
sources of remote sensing and other geospatial information to
address State, local, regional, and tribal agency needs to
forecast a plan for adaptation to coastal zone and land use
changes that may result as a consequence of global climate
change or climate variability.
(b) Preferred Projects.--In awarding grants under this
section, the Center shall give preference to projects that--
(1) focus on areas that are most sensitive to the
consequences of global climate change or climate variability;
(2) make use of existing public or commercial data sets;
(3) integrate multiple sources of geospatial information,
such as geographic information system data, satellite-
provided positioning data, and remotely sensed data, in
innovative ways;
(4) offer diverse, innovative approaches that may serve as
models for establishing a future coordinated framework for
planning strategies for adaptation to coastal zone and land
use changes related to global climate change or climate
variability;
(5) include funds or in-kind contributions from non-Federal
sources;
(6) involve the participation of commercial entities that
process raw or lightly processed data, often merging that
data with other geospatial information, to create data
products that have significant value added to the original
data; and
(7) taken together demonstrate as diverse a set of public
sector applications as possible.
(c) Opportunities.--In carrying out this section, the
Center shall seek opportunities to assist--
(1) in the development of commercial applications
potentially available from the remote sensing industry; and
(2) State, local, regional, and tribal agencies in applying
remote sensing and other geospatial information technologies
for management and adaptation to coastal and land use
consequences of global climate change or climate variability.
(d) Duration.--Assistance for a pilot project under
subsection (a) shall be provided for a period of not more
than 3 years.
(e) Responsibilities of Grantees.--Within 180 days after
completion of a grant project, each recipient of a grant
under subsection (a) shall transmit a report to the Center on
the results of the pilot project and conduct at least

[[Page S10803]]

one workshop for potential users to disseminate the lessons
learned from the pilot project as widely as feasible.
(f) Regulations.--The Center shall issue regulations
establishing application, selection, and implementation
procedures for pilot projects, and guidelines for reports and
workshops required by this section.

SEC. 1382. DATABASE ESTABLISHMENT.

The Center shall establish and maintain an electronic,
Internet-accessible database of the results of each pilot
project completed under section 1381.

SEC. 1383. AIR QUALITY RESEARCH, FORECASTS AND WARNINGS.

(a) Regional Studies.--The Secretary of Commerce, through
the Administrator of the National Oceanographic and
Atmospheric Administration, shall, in order of priority as
listed in section (c), conduct regional studies of the air
quality within specific regions of the United States. Such
studies should assess the effects of in situ emissions of air
pollutants and their precursors, transport of such emissions
and precursors from outside the region, and production of air
pollutants within the region via chemical reactions.
(b) Forecasts and Warnings.--The Secretary of Commerce,
through the Administrator of the National Oceanographic and
Atmospheric Administration, shall, in order of priority as
listed in section (c), establish a program to provide
operational air quality forecasts and warnings for specific
regions of the United States.
(c) Definition.--For the purposes of this section, the term
``specific regions of the United States'' means the following
geographical areas:
(1) the Northeast, composed of Main, New Hampshire,
Vermont, Massachusetts, Rhode Island, Connecticut, New York,
New Jersey, Pennsylvania, Maryland, Delaware, the District of
Columbia, and West Virginia;
(2) the Southeast, composed of Virginia, North Carolina,
South Carolina, Georgia, Alabama, and Florida;
(3) the Midwest, composed of Minnesota, Wisconsin, Iowa,
Missouri, Illinois, Kentucky, Indiana, Ohio, and Michigan;
(4) the South, composed of Tennessee, Mississippi,
Louisiana, Arkansas, Oklahoma, and Texas;
(5) the High Plains, composed of North Dakota, South
Dakota, Nebraska, and Kansas;
(6) the Northwest, composed of Washington, Oregon, Idaho,
Montana, and Wyoming;
(7) the Southwest, composed of California, Nevada, Utah,
Colorado, Arizona, and New Mexico;
(8) Alaska; and
(9) Hawaii.
(d) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary of Commerce $3,000,000
for each of fiscal years 2003 through 2006 for studies
pursuant to subsection (b) of this section, and $5,000,000
for fiscal year 2003 and such sums as may be necessary for
subsequent fiscal years for the forecast and warning program
pursuant to subsection (c) of this section.

SEC. 1384. DEFINITIONS.

In this subtitle:
(1) Center.--The term ``Center'' means the Coastal Services
Center of the National Oceanic and Atmospheric
Administration.
(2) Geospatial information.--The term ``geospatial
information'' means knowledge of the nature and distribution
of physical and cultural features on the landscape based on
analysis of data from airborne or spaceborne platforms or
other types and sources of data.
(3) Institution of higher education.--The term
``institution of higher education'' has the meaning given
that term in section 101(a) of the Higher Education Act of
1965 (20 U.S.C. 1001(a)).

SEC. 1385. AUTHORIZATION OF APPROPRIATIONS.

There are authorized to be appropriated to the
Administrator to carry out the provisions of this subtitle--
(1) $17,500,000 for fiscal year 2003;
(2) $20,000,000 for fiscal year 2004;
(3) $22,500,000 for fiscal year 2005; and
(4) $25,000,000 for fiscal year 2006.

TITLE XIV--MANAGEMENT OF DOE SCIENCE AND TECHNOLOGY PROGRAMS

SEC. 1401. DEFINITIONS.

In this title:
(1) Applicability of definitions.--The definitions in
section 1203 shall apply.
(2) Single-purpose research facility.--The term ``single-
purpose research facility'' means any of the following
primarily single purpose entities owned by the Department of
Energy--
(A) Ames Laboratory;
(B) East Tennessee Technology Park;
(C) Environmental Measurement Laboratory;
(D) Fernald Environmental Management Project;
(E) Fermi National Accelerator Laboratory;
(F) Kansas City Plant;
(G) Nevada Test Site;
(H) New Brunswick Laboratory;
(I) Pantex Weapons Facility;
(J) Princeton Plasma Physics Laboratory;
(K) Savannah River Technology Center;
(L) Stanford Linear Accelerator Center;
(M) Thomas Jefferson National Accelerator Facility;
(N) Y-12 facility at Oak Ridge National Laboratory;
(O) Waste Isolation Pilot Plant; or
(P) other similar organization of the Department designated
by the Secretary that engages in technology transfer,
partnering, or licensing activities.

SEC. 1402. AVAILABILITY OF FUNDS.

Funds authorized to be appropriated to the Department of
Energy under title XII, title XIII, and title XV shall remain
available until expended.

SEC. 1403. COST SHARING.

(a) Research and Development.--For research and development
projects funded from appropriations authorized under
subtitles A through D of title XII, the Secretary shall
require a commitment from non-Federal sources of at least 20
percent of the cost of the project. The Secretary may reduce
or eliminate the non-Federal requirement under this
subsection if the Secretary determines that the research and
development is of a basic or fundamental nature.
(b) Demonstration and Deployment.--For demonstration and
technology deployment activities funded from appropriations
authorized under subtitles A through D of title XII, the
Secretary shall require a commitment from non-Federal sources
of at least 50 percent of the costs of the project directly
and specifically related to any demonstration or technology
deployment activity. The Secretary may reduce or eliminate
the non-Federal requirement under this subsection if the
Secretary determines that the reduction is necessary and
appropriate considering the technological risks involved in
the project and is necessary to meet one or more goals of
this title.
(c) Calculation of Amount.--In calculating the amount of
the non-Federal commitment under subsection (a) or (b), the
Secretary shall include cash, personnel, services, equipment,
and other resources.

SEC. 1404. MERIT REVIEW OF PROPOSALS.

Awards of funds authorized under title XII, subtitle A of
title XIII, and title XV shall be made only after an
independent review of the scientific and technical merit of
the proposals for such awards has been made by the Department
of Energy.

SEC. 1405. EXTERNAL TECHNICAL REVIEW OF DEPARTMENTAL
PROGRAMS.

(a) National Energy Research and Development Advisory
Boards.--(1) The Secretary shall establish an advisory board
to oversee Department research and development programs in
each of the following areas--
(A) energy efficiency;
(B) renewable energy;
(C) fossil energy;
(D) nuclear energy; and
(E) climate change technology, with emphasis on
integration, collaboration, and other special features of the
cross-cutting technologies supported by the Office of Climate
Change Technology.
(2) The Secretary may designate an existing advisory board
within the Department to fulfill the responsibilities of an
advisory board under this subsection, or may enter into
appropriate arrangements with the National Academy of
Sciences to establish such an advisory board.
(b) Utilization of Existing Committees.--The Secretary of
Energy shall continue to use the scientific program advisory
committees chartered under the Federal Advisory Committee Act
by the Office of Science to oversee research and development
programs under that Office.
(c) Membership.--Each advisory board under this section
shall consist of experts drawn from industry, academia,
Federal laboratories, research institutions, or State, local,
or tribal governments, as appropriate.
(d) Meetings and Purposes.--Each advisory board under this
section shall meet at least semi-annually to review and
advise on the progress made by the respective research,
development, demonstration, and technology deployment
program. The advisory board shall also review the adequacy
and relevance of the goals established for each program by
Congress and the President, and may otherwise advise on
promising future directions in research and development that
should be considered by each program.

SEC. 1406. IMPROVED COORDINATION AND MANAGEMENT OF CIVILIAN
SCIENCE AND TECHNOLOGY PROGRAMS.

(a) Effective Top-Level Coordination of Research and
Development Programs.--Section 202(b) of the Department of
Energy Organization Act (42 U.S.C. 7132(b)) is amended to
read as follows:
``(b)(1) There shall be in the Department an Under
Secretary for Energy and Science, who shall be appointed by
the President, by and with the advice and consent of the
Senate. The Under Secretary shall be compensated at the rate
provided for at level III of the Executive Schedule under
section 5314 of title 5, United States Code.
``(2) The Under Secretary for Energy and Science shall be
appointed from among persons who--
``(A) have extensive background in scientific or
engineering fields; and
``(B) are well qualified to manage the civilian research
and development programs of the Department of Energy.
``(3) The Under Secretary for Energy and Science shall--
``(A) serve as the Science and Technology Advisor to the
Secretary;
``(B) monitor the Department's research and development
programs in order to advise the Secretary with respect to any
undesirable duplication or gaps in such programs;
``(C) advise the Secretary with respect to the well-being
and management of the multipurpose laboratories under the
jurisdiction of the Department;
``(D) advise the Secretary with respect to education and
training activities required for effective short- and long-
term basic and applied research activities of the Department;
``(E) advise the Secretary with respect to grants and other
forms of financial assistance required for effective short-
and long-term basic and applied research activities of the
Department; and
``(F) exercise authority and responsibility over Assistant
Secretaries carrying out energy research and development and
energy technology functions under sections 203 and 209, as
well as other elements of the Department assigned by the
Secretary.''.

[[Page S10804]]

(b) Reconfiguration of Position of Director of the Office
of Science.--Section 209 of the Department of Energy
Organization Act (41 U.S.C. 7139) is amended to read as
follows:
``(a) There shall be within the Department an Office of
Science, to be headed by an Assistant Secretary of Science,
who shall be appointed by the President, by and with the
advice and consent of the Senate, and who shall be
compensated at the rate provided for level IV of the
Executive Schedule under section 5315 of title 5, United
States Code.
``(b) The Assistant Secretary of Science shall be in
addition to the Assistant Secretaries provided for under
section 203 of this Act.
``(c) It shall be the duty and responsibility of the
Assistant Secretary of Science to carry out the fundamental
science and engineering research functions of the Department,
including the responsibility for policy and management of
such research, as well as other functions vested in the
Secretary which he may assign to the Assistant Secretary.''.
(c) Additional Assistant Secretary Position To Enable
Improved Management of Nuclear Energy Issues.--
(1) Section 203(a) of the Department of Energy Organization
Act (42 U.S.C. 7133(a)) is amended by striking ``There shall
be in the Department six Assistant Secretaries'' and
inserting ``Except as provided in section 209, there shall be
in the Department seven Assistant Secretaries''.
(2) It is the sense of the Senate that the leadership for
departmental missions in nuclear energy should be at the
Assistant Secretary level.
(d) Technical and Conforming Amendments.--
(1) Section 202 of the Department of Energy Organization
Act (42 U.S.C. 7132) is further amended by adding the
following at the end:
``(d) There shall be in the Department an Under Secretary,
who shall be appointed by the President, by and with the
advice and consent of the Senate, and who shall perform such
functions and duties as the Secretary shall prescribe,
consistent with this section. The Under Secretary shall be
compensated at the rate provided for level III of the
Executive Schedule under section 5314 of title 5, United
States Code.
``(e) There shall be in the Department a General Counsel,
who shall be appointed by the President, by and with the
advice and consent of the Senate. The General Counsel shall
be compensated at the rate provided for level IV of the
Executive Schedule under section 5315 of title 5, United
States Code.''.
(2) Section 5314 of title 5, United States Code, is amended
by striking ``Under Secretaries of Energy (2)'' and inserting
``Under Secretaries of Energy (3)''.
(3) Section 5315 of title 5, United States Code, is amended
by--
(A) striking ``Director, Office of Science, Department of
Energy.''; and
(B) striking ``Assistant Secretaries of Energy (6)'' and
inserting ``Assistant Secretaries of Energy (8)''.
(4) The table of contents for the Department of Energy
Organization Act (42 U.S.C. 7101 note) is amended--
(A) by striking ``Section 209'' and inserting ``Sec. 209'';
(B) by striking ``213.'' and inserting ``Sec. 213.'';
(C) by striking ``214.'' and inserting ``Sec. 214.'';
(D) by striking ``215.'' and inserting ``Sec. 215.''; and
(E) by striking ``216.'' and inserting ``Sec. 216.''.

SEC. 1407. IMPROVED COORDINATION OF TECHNOLOGY TRANSFER
ACTIVITIES.

(a) Technology Transfer Coordinator.--The Secretary shall
appoint a Technology Transfer Coordinator to perform
oversight of and policy development for technology transfer
activities at the Department. The Technology Transfer
Coordinator shall coordinate the activities of the Technology
Partnerships Working Group, and shall oversee the expenditure
of funds allocated to the Technology Partnership Working
Group.
(b) Technology Partnership Working Group.--The Secretary
shall establish a Technology Partnership Working Group, which
shall consist of representatives of the National Laboratories
and single-purpose research facilities, to--
(1) coordinate technology transfer activities occurring at
National Laboratories and single-purpose research facilities;
(2) exchange information about technology transfer
practices; and
(3) develop and disseminate to the public and prospective
technology partners information about opportunities and
procedures for technology transfer with the Department.

SEC. 1408. TECHNOLOGY INFRASTRUCTURE PROGRAM.

(a) Establishment.--The Secretary shall establish a
Technology Infrastructure Program in accordance with this
section.
(b) Purpose.--The purpose of the Technology Infrastructure
Program shall be to improve the ability of National
Laboratories or single-purpose research facilities to support
departmental missions by--
(1) stimulating the development of technology clusters that
can support departmental missions at the National
Laboratories or single-purpose research facilities;
(2) improving the ability of National Laboratories or
single-purpose research facilities to leverage and benefit
from commercial research, technology, products, processes,
and services; and
(3) encouraging the exchange of scientific and
technological expertise between National Laboratories or
single-purpose research facilities and--
(A) institutions of higher education,
(B) technology-related business concerns,
(C) nonprofit institutions, and
(D) agencies of State, tribal, or local governments,
that can support departmental missions at the National
Laboratories and single-purpose research facilities.
(c) Projects.--The Secretary shall authorize the Director
of each National Laboratory or facility to implement the
Technology Infrastructure Program at such National Laboratory
or single-purpose research facility through projects that
meet the requirements of subsections (d) and (e).
(d) Program Requirements.--Each project funded under this
section shall meet the following requirements:
(1) Minimum participants.--Each project shall at a minimum
include--
(A) a National Laboratory or single-purpose research
facility; and
(B) one of the following entities--
(i) a business,
(ii) an institution of higher education,
(iii) a nonprofit institution, or
(iv) an agency of a State, local, or tribal government.
(2) Cost sharing.--
(A) Minimum amount.--Not less than 50 percent of the costs
of each project funded under this section shall be provided
from non-Federal sources.
(B) Qualified funding and resources.--(i) The calculation
of costs paid by the non-Federal sources to a project shall
include cash, personnel, services, equipment, and other
resources expended on the project.
(ii) Independent research and development expenses of
Government contractors that qualify for reimbursement under
section 31-205-18(e) of the Federal Acquisition Regulations
issued pursuant to section 25(c)(1) of the Office of Federal
Procurement Policy Act (41 U.S.C. 421(c)(1)) may be credited
towards costs paid by non-Federal sources to a project, if
the expenses meet the other requirements of this section.
(iii) No funds or other resources expended either before
the start of a project under this section or outside the
project's scope of work shall be credited toward the costs
paid by the non-Federal sources to the project.
(3) Competitive selection.--All projects in which a party
other than the Department, a National Laboratory, or a
single-purpose research facility receives funding under this
section shall, to the extent practicable, be competitively
selected by the National Laboratory or facility using
procedures determined to be appropriate by the Secretary.
(4) Accounting standards.--Any participant that receives
funds under this section, other than a National Laboratory or
single-purpose research facility, may use generally accepted
accounting principles for maintaining accounts, books, and
records relating to the project.
(5) Limitations.--No Federal funds shall be made available
under this section for--
(A) construction; or
(B) any project for more than 5 years.
(e) Selection Criteria.--
(1) Threshold funding criteria.--The Secretary shall
allocate funds under this section only if the Director of the
National Laboratory or single-purpose research facility
managing the project determines that the project is likely to
improve the ability of the National Laboratory or single-
purpose research facility to achieve technical success in
meeting departmental missions.
(2) Additional criteria.--The Secretary shall require the
Director of the National Laboratory or single-purpose
research facility managing a project under this section to
consider the following criteria in selecting a project to
receive Federal funds--
(A) the potential of the project to succeed, based on its
technical merit, team members, management approach,
resources, and project plan;
(B) the potential of the project to promote the development
of a commercially sustainable technology cluster, which will
derive most of the demand for its products or services from
the private sector, and which will support departmental
missions at the participating National Laboratory or single-
purpose research facility;
(C) the potential of the project to promote the use of
commercial research, technology, products, processes, and
services by the participating National Laboratory or single-
purpose research facility to achieve its departmental mission
or the commercial development of technological innovations
made at the participating National Laboratory or single-
purpose research facility;
(D) the commitment shown by non-Federal organizations to
the project, based primarily on the nature and amount of the
financial and other resources they will risk on the project;
(E) the extent to which the project involves a wide variety
and number of institutions of higher education, nonprofit
institutions, and technology-related business concerns that
can support the missions of the participating National
Laboratory or single-purpose research facility and that will
make substantive contributions to achieving the goals of the
project;
(F) the extent of participation in the project by agencies
of State, tribal, or local governments that will make
substantive contributions to achieving the goals of the
project;
(G) the extent to which the project focuses on promoting
the development of technology-related business concerns that
are small business concerns or involves such small business
concerns substantively in the project; and
(H) such other criteria as the Secretary determines to be
appropriate.
(f) Report to Congress.--Not later than January 1, 2004,
the Secretary shall report to Congress on whether the
Technology Infrastructure Program should be continued and, if
so, how the program should be managed.
(g) Definitions.--In this section:
(1) Technology cluster.--The term ``technology cluster''
means a concentration of--

[[Page S10805]]

(A) technology-related business concerns;
(B) institutions of higher education; or
(C) other nonprofit institutions;
that reinforce each other's performance in the areas of
technology development through formal or informal
relationships.
(2) Technology-related business concern.--The term
``technology-related business concern'' means a for-profit
corporation, company, association, firm, partnership, or
small business concern that--
(A) conducts scientific or engineering research,
(B) develops new technologies,
(C) manufactures products based on new technologies, or
(D) performs technological services.
(h) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary for activities under this
section $10,000,000 for each of fiscal years 2003 and 2004.

SEC. 1409. SMALL BUSINESS ADVOCACY AND ASSISTANCE.

(a) Small Business Advocate.--The Secretary shall require
the Director of each National Laboratory, and may require the
Director of a single-purpose research facility, to appoint a
small business advocate to--
(1) increase the participation of small business concerns,
including socially and economically disadvantaged small
business concerns, in procurement, collaborative research,
technology licensing, and technology transfer activities
conducted by the National Laboratory or single-purpose
research facility;
(2) report to the Director of the National Laboratory or
single-purpose research facility on the actual participation
of small business concerns in procurement and collaborative
research along with recommendations, if appropriate, on how
to improve participation;
(3) make available to small business concerns training,
mentoring, and clear, up-to-date information on how to
participate in the procurement and collaborative research,
including how to submit effective proposals;
(4) increase the awareness inside the National Laboratory
or single-purpose research facility of the capabilities and
opportunities presented by small business concerns; and
(5) establish guidelines for the program under subsection
(b) and report on the effectiveness of such program to the
Director of the National Laboratory or single-purpose
research facility.
(b) Establishment of Small Business Assistance Program.--
The Secretary shall require the Director of each National
Laboratory, and may require the director of a single-purpose
research facility, to establish a program to provide small
business concerns--
(1) assistance directed at making them more effective and
efficient subcontractors or suppliers to the National
Laboratory or single-purpose research facility; or
(2) general technical assistance, the cost of which shall
not exceed $10,000 per instance of assistance, to improve the
small business concern's products or services.
(c) Use of Funds.--None of the funds expended under
subsection (b) may be used for direct grants to the small
business concerns.
(d) Definitions.--In this section:
(1) Small business concern.--The term ``small business
concern'' has the meaning given such term in section 3 of the
Small Business Act (15 U.S.C. 632).
(2) Socially and economically disadvantaged small business
concerns.--The term ``socially and economically disadvantaged
small business concerns'' has the meaning given such term in
section 8(a)(4) of the Small Business Act (15 U.S.C.
637(a)(4)).

SEC. 1410. OTHER TRANSACTIONS.

(a) In General.--Section 646 of the Department of Energy
Organization Act (42 U.S.C. 7256) is amended by adding at the
end the following:
``(g) Other Transactions Authority.--(1) In addition to
other authorities granted to the Secretary to enter into
procurement contracts, leases, cooperative agreements,
grants, and other similar arrangements, the Secretary may
enter into other transactions with public agencies, private
organizations, or persons on such terms as the Secretary may
deem appropriate in furtherance of basic, applied, and
advanced research functions now or hereafter vested in the
Secretary. Such other transactions shall not be subject to
the provisions of section 9 of the Federal Nonnuclear Energy
Research and Development Act of 1974 (42 U.S.C. 5908).
``(2)(A) The Secretary of Energy shall ensure that--
``(i) to the maximum extent practicable, no transaction
entered into under paragraph (1) provides for research that
duplicates research being conducted under existing programs
carried out by the Department of Energy; and
``(ii) to the extent that the Secretary determines
practicable, the funds provided by the Government under a
transaction authorized by paragraph (1) do not exceed the
total amount provided by other parties to the transaction.
``(B) A transaction authorized by paragraph (1) may be used
for a research project when the use of a standard contract,
grant, or cooperative agreement for such project is not
feasible or appropriate.
``(3)(A) The Secretary shall not disclose any trade secret
or commercial or financial information submitted by a non-
Federal entity under paragraph (1) that is privileged and
confidential.
``(B) The Secretary shall not disclose, for 5 years after
the date the information is received, any other information
submitted by a non-Federal entity under paragraph (1),
including any proposal, proposal abstract, document
supporting a proposal, business plan, or technical
information that is privileged and confidential.
``(C) The Secretary may protect from disclosure, for up to
5 years, any information developed pursuant to a transaction
under paragraph (1) that would be protected from disclosure
under section 552(b)(4) of title 5, United States Code, if
obtained from a person other than a Federal agency.''.
(b) Implementation.--Not later than 6 months after the date
of enactment of this section, the Department shall establish
guidelines for the use of other transactions.

SEC. 1411. MOBILITY OF SCIENTIFIC AND TECHNICAL PERSONNEL.

Not later than 2 years after the enactment of this section,
the Secretary, acting through the Technology Transfer
Coordinator under section 1407, shall determine whether each
contractor operating a National Laboratory or single-purpose
research facility has policies and procedures that do not
create disincentives to the transfer of scientific and
technical personnel among the contractor-operated National
Laboratories or contractor-operated single-purpose research
facilities.

SEC. 1412. NATIONAL ACADEMY OF SCIENCES REPORT.

Within 90 days after the date of enactment of this Act, the
Secretary shall contract with the National Academy of
Sciences to--
(1) conduct a study on the obstacles to accelerating the
innovation cycle for energy technology, and
(2) report to the Congress recommendations for shortening
the cycle of research, development, and deployment.

SEC. 1413. REPORT ON TECHNOLOGY READINESS AND BARRIERS TO
TECHNOLOGY TRANSFER.

(a) In General.--The Secretary, acting through the
Technology Partnership Working Group and in consultation with
representatives of affected industries, universities, and
small business concerns, shall--
(1) assess the readiness for technology transfer of energy
technologies developed through projects funded from
appropriations authorized under subtitles A through D of
title XIV, and
(2) identify barriers to technology transfer and
cooperative research and development agreements between the
Department or a National Laboratory and a non-Federal person;
and
(3) make recommendations for administrative or legislative
actions needed to reduce or eliminate such barriers.
(b) Report.--The Secretary shall provide a report to
Congress and the President on activities carried out under
this section not later than 1 year after the date of
enactment of this section, and shall update such report on a
biennial basis, taking into account progress toward
eliminating barriers to technology transfer identified in
previous reports under this section.

SEC. 1414. UNITED STATES-MEXICO ENERGY TECHNOLOGY
COOPERATION.

(a) Finding.--Congress finds that the economic and energy
security of the United States and Mexico is furthered through
collaboration between the United States and Mexico on
research related to energy technologies.
(b) Program.--
(1) In general.--The Secretary, acting through the
Assistant Secretary for Environmental Management, shall
establish a collaborative research, development, and
deployment program to promote energy efficient,
environmentally sound economic development along the United
States-Mexico border to--
(A) mitigate hazardous waste;
(B) promote energy efficient materials processing
technologies that minimize environmental damage; and
(C) protect the public health.
(2) Consultation.--The Secretary, acting through the
Assistant Secretary for Environmental Management, shall
consult with the Office of Energy Efficiency and Renewable
Energy in carrying out paragraph (1)(B).
(c) Program Management.--The program under subsection (b)
shall be managed by the Department of Energy Carlsbad
Environmental Management Field Office.
(d) Cost Sharing.--The cost of any project or activity
carried out using funds provided under this section shall be
shared as provided in section 1403.
(e) Technology Transfer.--In carrying out projects and
activities under this section to mitigate hazardous waste,
the Secretary shall emphasize the transfer of technology
developed under the Environmental Management Science Program
of the Department of Energy.
(f) Intellectual Property.--In carrying out this section,
the Secretary shall comply with the requirements of any
agreement entered between the United States and Mexico
regarding intellectual property protection.
(g) Authorization of Appropriations.--There are authorized
to be appropriated to carry out this section $5,000,000 for
fiscal year 2003 and $6,000,000 for each of fiscal years 2004
through 2006, to remain available until expended.

TITLE XV--PERSONNEL AND TRAINING

SEC. 1501. WORKFORCE TRENDS AND TRAINEESHIP GRANTS.

(a) Workforce Trends.--
(1) Monitoring.--The Secretary of Energy (in this title
referred to as the ``Secretary''), acting through the
Administrator of the Energy Information Administration, in
consultation with the Secretary of Labor, shall monitor
trends in the workforce of skilled technical personnel
supporting energy technology industries, including renewable
energy industries, companies developing and commercializing
devices to increase energy-efficiency, the oil and gas
industry, the electric power generation industry (including
the nuclear power industry), the coal industry, and other
industrial sectors as the Secretary may deem appropriate.
(2) Annual reports.--The Administrator of the Energy
Information Administration shall include statistics on energy
industry workforce

[[Page S10806]]

trends in the annual reports of the Energy Information
Administration.
(3) Special reports.--The Secretary shall report to the
appropriate committees of Congress whenever the Secretary
determines that significant shortfalls of technical personnel
in one or more energy industry segments are forecast or have
occurred.
(b) Traineeship Grants for Technically Skilled Personnel.--
(1) Grant programs.--The Secretary shall establish grant
programs in the appropriate offices of the Department to
enhance training of technically skilled personnel for which a
shortfall is determined under subsection (a).
(2) Eligible institutions.--As determined by the Secretary
to be appropriate to the particular workforce shortfall, the
Secretary shall make grants under paragraph (1) to--
(A) an institution of higher education;
(B) a postsecondary educational institution providing
vocational and technical education (within the meaning given
those terms in section 3 of the Carl D. Perkins Vocational
and Technical Education Act of 1998 (20 U.S.C. 2302));
(C) appropriate agencies of State, local, or tribal
governments; or
(D) joint labor and management training organizations with
State or federally recognized apprenticeship programs and
other employee-based training organizations as the Secretary
considers appropriate.
(c) Definition.--For purposes of this section, the term
``skilled technical personnel'' means journey and apprentice
level workers who are enrolled in or have completed a State
or federally recognized apprenticeship program and other
skilled workers in energy technology industries.
(d) Authorization of Appropriations.--From amounts
authorized under section 1241(c), there are authorized to be
appropriated to the Secretary for activities under this
section such sums as may be necessary for each fiscal year.

SEC. 1502. POSTDOCTORAL AND SENIOR RESEARCH FELLOWSHIPS IN
ENERGY RESEARCH.

(a) Postdoctoral Fellowships.--The Secretary shall
establish a program of fellowships to encourage outstanding
young scientists and engineers to pursue postdoctoral
research appointments in energy research and development at
institutions of higher education of their choice. In
establishing a program under this subsection, the Secretary
may enter into appropriate arrangements with the National
Academy of Sciences to help administer the program.
(b) Distinguished Senior Research Fellowships.--The
Secretary shall establish a program of fellowships to allow
outstanding senior researchers in energy research and
development and their research groups to explore research and
development topics of their choosing for a fixed period of
time. Awards under this program shall be made on the basis of
past scientific or technical accomplishment and promise for
continued accomplishment during the period of support, which
shall not be less than 3 years.
(c) Authorization of Appropriations.--From amounts
authorized under section 1241(c), there are authorized to be
appropriated to the Secretary for activities under this
section such sums as may be necessary for each fiscal year.

SEC. 1503. TRAINING GUIDELINES FOR ELECTRIC ENERGY INDUSTRY
PERSONNEL.

(a) Model Guidelines.--The Secretary shall, in cooperation
with electric generation, transmission, and distribution
companies and recognized representatives of employees of
those entities, develop model employee training guidelines to
support electric supply system reliability and safety.
(b) Content of Guidelines.--The guidelines under this
section shall include--
(1) requirements for worker training, competency, and
certification, developed using criteria set forth by the
Utility Industry Group recognized by the National Skill
Standards Board; and
(2) consolidation of existing guidelines on the
construction, operation, maintenance, and inspection of
electric supply generation, transmission and distribution
facilities such as those established by the National Electric
Safety Code and other industry consensus standards.

SEC. 1504. NATIONAL CENTER ON ENERGY MANAGEMENT AND BUILDING
TECHNOLOGIES.

The Secretary shall establish a National Center on Energy
Management and Building Technologies, to carry out research,
education, and training activities to facilitate the
improvement of energy efficiency and indoor air quality in
industrial, commercial and residential buildings. The
National Center shall be established in cooperation with--
(1) recognized representatives of employees in the heating,
ventilation, and air-conditioning industry;
(2) contractors that install and maintain heating,
ventilation and air-conditioning systems and equipment;
(3) manufacturers of heating, ventilation and air-
conditioning systems and equipment;
(4) representatives of the advanced building envelope
industry, including design, windows, lighting, and insulation
industries; and
(5) other entities as appropriate.

SEC. 1505. IMPROVED ACCESS TO ENERGY-RELATED SCIENTIFIC AND
TECHNICAL CAREERS.

(a) Department of Energy Science Education Programs.--
Section 3164 of the Department of Energy Science Education
Enhancement Act (42 U.S.C. 7381a) is amended by adding at the
end the following:
``(c) Programs for Women and Minority Students.--In
carrying out a program under subsection (a), the Secretary
shall give priority to activities that are designed to
encourage women and minority students to pursue scientific
and technical careers.''.
(b) Partnerships With Historically Black Colleges and
Universities, Hispanic-Servicing Institutions, and Tribal
Colleges.--The Department of Energy Science Education
Enhancement Act (42 U.S.C. 7381 et seq.) is amended--
(1) by redesignating sections 3167 and 3168 as sections
3168 and 3169, respectively; and
(2) by inserting after section 3166 the following:

``SEC. 3167. PARTNERSHIPS WITH HISTORICALLY BLACK COLLEGES
AND UNIVERSITIES, HISPANIC-SERVING
INSTITUTIONS, AND TRIBAL COLLEGES.

``(a) Definitions.--In this section:
``(1) Hispanic-serving institution.--The term `Hispanic-
serving institution' has the meaning given the term in
section 502(a) of the Higher Education Act of 1965 (20 U.S.C.
1101a(a)).
``(2) Historically black college or university.--The term
`historically Black college or university' has the meaning
given the term `part B institution' in section 322 of the
Higher Education Act of 1965 (20 U.S.C. 1061).
``(3) National laboratory.--The term `National Laboratory'
has the meaning given the term in section 1203 of the Energy
Science and Technology Enhancement Act of 2003.
``(4) Science facility.--The term `science facility' has
the meaning given the term `single-purpose research facility'
in section 1401 of the Energy Science and Technology
Enhancement Act of 2003.
``(5) Tribal college.--The term `tribal college' has the
meaning given the term `tribally controlled college or
university' in section 2(a) of the Tribally Controlled
College or University Assistance Act of 1978 (25 U.S.C.
1801(a)).
``(b) Education Partnership.--
``(1) In general.--The Secretary shall direct the Director
of each National Laboratory, and may direct the head of any
science facility, to increase the participation of
historically Black colleges or universities, Hispanic-serving
institutions, or tribal colleges in activities that increase
the capacity of the historically Black colleges or
universities, Hispanic-serving institutions, or tribal
colleges to train personnel in science or engineering.
``(2) Activities.--An activity under paragraph (1) may
include--
``(A) collaborative research;
``(B) a transfer of equipment;
``(C) training of personnel at a National Laboratory or
science facility; and
``(D) a mentoring activity by personnel at a National
Laboratory or science facility.
``(c) Report.--Not later than 2 years after the date of
enactment of this section, the Secretary shall submit to the
Committee on Science of the House of Representatives and the
Committee on Energy and Natural Resources of the Senate a
report on the activities carried out under this section.''.

SEC. 1506. NATIONAL POWER PLANT OPERATIONS TECHNOLOGY AND
EDUCATION CENTER.

(a) Establishment.--The Secretary shall establish a
National Power Plant Operations Technology and Education
Center (the ``Center''), to address the need for training and
educating certified operators for electric power generation
plants.
(b) Role.--The Center shall provide both training and
continuing education relating to electric power generation
plant technologies and operations. The Center shall conduct
training and education activities on site and through
Internet-based information technologies that allow for
learning at remote sites.
(c) Criteria for Competitive Selection.--The Secretary
shall establish the Center at an institution of higher
education with expertise in plant technology and operation
and that can provide on-site as well as Internet-based
training.

SEC. 1507. FEDERAL MINE INSPECTORS.

In light of projected retirements of Federal mine
inspectors and the need for additional personnel, the
Secretary of Labor shall hire, train, and deploy such
additional skilled mine inspectors (particularly inspectors
with practical experience as a practical mining engineer) as
necessary to ensure the availability of skilled and
experienced individuals and to maintain the number of Federal
mine inspectors at or above the levels authorized by law or
established by regulation.

DIVISION F--TECHNOLOGY ASSESSMENT AND STUDIES

TITLE XVI--TECHNOLOGY ASSESSMENT

SEC. 1601. NATIONAL SCIENCE AND TECHNOLOGY ASSESSMENT
SERVICE.

The National Science and Technology Policy, Organization,
and Priorities Act of 1976 (42 U.S.C. 6601 et seq.) is
amended by adding at the end the following:

``TITLE VII--NATIONAL SCIENCE AND TECHNOLOGY ASSESSMENT SERVICE

``SEC. 701. ESTABLISHMENT.

``There is hereby created a Science and Technology
Assessment Service (hereinafter referred to as the
`Service'), which shall be within and responsible to the
legislative branch of the Government.

``SEC. 702. COMPOSITION.

``The Service shall consist of a Science and Technology
Board (hereinafter referred to as the `Board') which shall
formulate and promulgate the policies of the Service, and a
Director who shall carry out such policies and administer the
operations of the Service.

``SEC. 703. FUNCTIONS AND DUTIES.

``The Service shall coordinate and develop information for
Congress relating to the uses and application of technology
to address current national science and technology policy
issues. In developing such technical assessments for
Congress, the Service shall utilize, to the extent
practicable, experts selected in coordination with the
National Research Council.

[[Page S10807]]

``SEC. 704. INITIATION OF ACTIVITIES.

``Science and technology assessment activities undertaken
by the Service may be initiated upon the request of--
``(1) the Chairman of any standing, special, or select
committee of either House of the Congress, or of any joint
committee of the Congress, acting for himself or at the
request of the ranking minority member or a majority of the
committee members;
``(2) the Board; or
``(3) the Director.

``SEC. 705. ADMINISTRATION AND SUPPORT.

``The Director of the Science and Technology Assessment
Service shall be appointed by the Board and shall serve for a
term of 6 years unless sooner removed by the Board. The
Director shall receive basic pay at the rate provided for
level III of the Executive Schedule under section 5314 of
title 5, United States Code. The Director shall contract for
administrative support from the Library of Congress.

``SEC. 706. AUTHORITY.

``The Service shall have the authority, within the limits
of available appropriations, to do all things necessary to
carry out the provisions of this section, including, but
without being limited to, the authority to--
``(1) make full use of competent personnel and
organizations outside the Office, public or private, and form
special ad hoc task forces or make other arrangements when
appropriate;
``(2) enter into contracts or other arrangements as may be
necessary for the conduct of the work of the Office with any
agency or instrumentality of the United States, with any
State, territory, or possession or any political subdivision
thereof, or with any person, firm, association, corporation,
or educational institution, with or without reimbursement,
without performance or other bonds, and without regard to
section 3709 of the Revised Statutes (41 U.S.C. 51);
``(3) accept and utilize the services of voluntary and
uncompensated personnel necessary for the conduct of the work
of the Service and provide transportation and subsistence as
authorized by section 5703 of title 5, United States Code,
for persons serving without compensation; and
``(4) prescribe such rules and regulations as it deems
necessary governing the operation and organization of the
Service.

``SEC. 707. BOARD.

``The Board shall consist of 13 members as follows--
``(1) six Members of the Senate, appointed by the President
pro tempore of the Senate, three from the majority party and
three from the minority party;
``(2) six Members of the House of Representatives appointed
by the Speaker of the House of Representatives, three from
the majority party and three from the minority party; and
``(3) the Director, who shall not be a voting member.

``SEC. 708. REPORT TO CONGRESS.

``The Service shall submit to the Congress an annual report
which shall include, but not be limited to, an evaluation of
technology assessment techniques and identification, insofar
as may be feasible, of technological areas and programs
requiring future analysis. The annual report shall be
submitted not later than March 15 of each year.

``SEC. 709. AUTHORIZATION OF APPROPRIATIONS.

``There are authorized to be appropriated to the Service
such sums as are necessary to fulfill the requirements of
this title.''.

TITLE XVII--STUDIES

SEC. 1701. REGULATORY REVIEWS.

(a) Regulatory Reviews.--Not later than 1 year after the
date of enactment of this section and every 5 years
thereafter, each Federal agency shall review relevant
regulations and standards to identify--
(1) existing regulations and standards that act as barriers
to--
(A) market entry for emerging energy technologies
(including fuel cells, combined heat and power, distributed
power generation, and small-scale renewable energy), and
(B) market development and expansion for existing energy
technologies (including combined heat and power, small-scale
renewable energy, geothermal heat pump technology, and energy
recovery in industrial processes), and
(2) actions the agency is taking or could take to--
(A) remove barriers to market entry for emerging energy
technologies and to market expansion for existing
technologies,
(B) increase energy efficiency and conservation, or
(C) encourage the use of new and existing processes to meet
energy and environmental goals.
(b) Report to Congress.--Not later than 18 months after the
date of enactment of this section, and every 5 years
thereafter, the Director of the Office of Science and
Technology Policy shall report to the Congress on the results
of the agency reviews conducted under subsection (a).
(c) Contents of the Report.--The report shall--
(1) identify all regulatory barriers to--
(A) the development and commercialization of emerging
energy technologies and processes, and
(B) the further development and expansion of existing
energy conservation technologies and processes,
(2) actions taken, or proposed to be taken, to remove such
barriers, and
(3) recommendations for changes in laws or regulations that
may be needed to--
(A) expedite the siting and development of energy
production and distribution facilities,
(B) encourage the adoption of energy efficiency and process
improvements,
(C) facilitate the expanded use of existing energy
conservation technologies, and
(D) reduce the environmental impacts of energy facilities
and processes through transparent and flexible compliance
methods.

SEC. 1702. ASSESSMENT OF DEPENDENCE OF STATE OF HAWAII ON
OIL.

(a) Assessment.--The Secretary of Energy shall assess the
economic implications of the dependence of the State of
Hawaii on oil as the principal source of energy for the
State, including--
(1) the short- and long-term prospects for crude oil supply
disruption and price volatility and potential impacts on the
economy of Hawaii;
(2) the economic relationship between oil-fired generation
of electricity from residual fuel and refined petroleum
products consumed for ground, marine, and air transportation;
(3) the technical and economic feasibility of increasing
the contribution of renewable energy resources for generation
of electricity, on an island-by-island basis, including--
(A) siting and facility configuration;
(B) environmental, operational, and safety considerations;
(C) the availability of technology;
(D) effects on the utility system, including reliability;
(E) infrastructure and transport requirements;
(F) community support; and
(G) other factors affecting the economic impact of such an
increase and any effect on the economic relationship
described in paragraph (2);
(4) the technical and economic feasibility of using
liquefied natural gas to displace residual fuel oil for
electric generation, including neighbor island opportunities,
and the effect of such displacement on the economic
relationship described in paragraph (2), including--
(A) the availability of supply;
(B) siting and facility configuration for onshore and
offshore liquefied natural gas receiving terminals;
(C) the factors described in subparagraphs (B) through (F)
of paragraph (3); and
(D) other economic factors;
(5) the technical and economic feasibility of using
renewable energy sources (including hydrogen) for ground,
marine, and air transportation energy applications to
displace the use of refined petroleum products, on an island-
by-island basis, and the economic impact of such displacement
on the relationship described in paragraph (2); and
(6) an island-by-island approach to--
(A) the development of hydrogen from renewable resources;
and
(B) the application of hydrogen to the energy needs of
Hawaii.
(b) Contracting Authority.--The Secretary may carry out the
assessment under subsection (a) directly or, in whole or in
part, through one or more contracts with qualified public or
private entities.
(c) Report.--Not later than 300 days after the date of
enactment of this Act, the Secretary shall prepare, in
consultation with agencies of the State of Hawaii and other
stakeholders, as appropriate, and submit to Congress, a
report detailing the findings, conclusions, and
recommendations resulting from the assessment.
(d) Authorization of Appropriations.--There are authorized
to be appropriated such sums as are necessary to carry out
this section.

SEC. 1703. STUDY OF SITING AN ELECTRIC TRANSMISSION SYSTEM ON
AMTRAK RIGHT-OF-WAY.

(a) Study.--The Secretary of Energy shall contract with
Amtrak to conduct a study of the feasibility of building and
operating a new electric transmission system on the Amtrak
right-of-way in the Northeast Corridor.
(b) Scope of the Study.--The study shall focus on siting
the new system on the Amtrak right-of-way within the
Northeast Corridor between Washington, D.C., and New
Rochelle, New York, including the Amtrak right-of-way between
Philadelphia, Pennsylvania and Harrisburg, Pennsylvania.
(c) Contents of the Study.--The study shall consider--
(1) alternative geographic configuration of a new
electronic transmission system on the Amtrak right-of-way;
(2) alternative technologies for the system;
(3) the estimated costs of building and operating each
alternative;
(4) alternative means of financing the system;
(5) the environmental risks and benefits of building and
operating each alternative as well as environmental risks and
benefits of building and operating the system on the
Northeast Corridor rather than at other locations;
(6) engineering and technological obstacles to building and
operating each alternative; and
(7) the extent to which each alternative would enhance the
reliability of the electric transmission grid and enhance
competition in the sale of electric energy at wholesale
within the Northeast Corridor.
(d) Recommendations.--The study shall recommend the optimal
geographic configuration, the optimal technology, the optimal
engineering design, and the optimal means of financing for
the new system from among the alternatives considered.
(e) Report.--The Secretary of Energy shall submit the
completed study to the Committee on Energy and Natural
Resources of the United States Senate and the Committee on
Energy and Commerce of the House of Representatives not later
than 270 days after the date of enactment of this section.
(f) Definitions.--For purposes of this section--
(1) the term ``Amtrak'' means the National Railroad
Passenger Corporation established under chapter 243 of title
49, United States Code; and
(2) the term ``Northeast Corridor'' shall have the meaning
given such term under section 24102(7) of title 49, United
States Code.

[[Page S10808]]

SEC. 1704. UPDATING OF INSULAR AREA RENEWABLE ENERGY AND
ENERGY EFFICIENCY PLANS.

Section 604 of Public Law 96-597 (48 U.S.C. 1492) is
amended--
(1) in subsection (a) at the end of paragraph (4) by
striking ``resources.'' and inserting ``resources; and
``(5) the development of renewable energy and energy
efficiency technologies since publication of the 1982
Territorial Energy Assessment prepared under subsection (c)
reveals the need to reassess the state of energy production,
consumption, efficiency, infrastructure, reliance on imported
energy, and potential of the indigenous renewable energy
resources and energy efficiency in regard to the insular
areas.''; and
(2) by adding at the end of subsection (e) ``The Secretary
of Energy, in consultation with the Secretary of the Interior
and the chief executive officer of each insular area, shall
update the plans required under subsection (c) and draft
long-term energy plans for each insular area that will
reduce, to the extent feasible, the reliance of the insular
area on energy imports by the year 2010, and maximize, to the
extent feasible, use of renewable energy resources and energy
efficiency opportunities. Not later than December 31, 2002,
the Secretary of Energy shall submit the updated plans to
Congress.''.

SEC. 1705. CONSUMER ENERGY COMMISSION.

(a) Establishment of Commission.--There is established a
commission to be known as the ``Consumer Energy Commission''.
(b) Membership.--
(1) In general.--The Commission shall be comprised of 11
members who shall be appointed within 30 days from the date
of enactment of this section and who shall serve for the life
of the Commission.
(2) Appointments in the senate and the house.--The Majority
Leader and the Minority Leader of the Senate and the Speaker
and Minority Leader of the House of Representatives shall
each appoint 2 members--
(A) one of whom shall represent consumer groups focusing on
energy issues; and
(B) one of whom shall represent the energy industry.
(3) Appointments by the president.--The President shall
appoint three members--
(A) one of whom shall represent consumer groups focusing on
energy issues;
(B) one of whom shall represent the energy industry; and
(C) one of whom shall represent the Department of Energy.
(c) Initial Meeting.--Not later than 60 days after the date
of enactment of this Act, the Commission shall hold the first
meeting of the Commission regardless of the number of members
that have been appointed and shall select a Chairperson and
Vice Chairperson from among the members of the Commission.
(d) Administrative Expenses.--Members of the Commission
shall serve without compensation, except for per diem and
travel expenses which shall be reimbursed, and the Department
of Energy shall pay expenses as necessary to carry out this
section, with the expenses not to exceed $400,000.
(e) Studies.--The Commission shall conduct a nationwide
study of significant price spikes since 1990 in major United
States consumer energy products, including electricity,
gasoline, home heating oil, natural gas and propane with a
focus on their causes including insufficient inventories,
supply disruptions, refinery capacity limits, insufficient
infrastructure, regulatory failures, demand growth, reliance
on imported supplies, insufficient availability of
alternative energy sources, abuse of market power, market
concentration and any other relevant factors.
(f) Report.--Not later than 180 days after the date of the
first meeting of the Commission, the Commission shall submit
to Congress a report that contains the findings and
conclusions of the Commission and any recommendations for
legislation, administrative actions, and voluntary actions by
industry and consumers to protect consumers and small
businesses from future price spikes in consumer energy
products.
(g) Consultation.--The Commission shall consult with the
Federal Trade Commission, the Federal Energy Regulatory
Commission, the Department of Energy and other Federal and
State agencies as appropriate.
(h) Sunset.--The Commission shall terminate within 30 days
after the submission of the report to Congress.

SEC. 1706. STUDY OF NATURAL GAS AND OTHER ENERGY TRANSMISSION
INFRASTRUCTURE ACROSS THE GREAT LAKES.

(a) Definitions.--In this section:
(1) Great lake.--The term ``Great Lake'' means Lake Erie,
Lake Huron (including Lake Saint Clair), Lake Michigan, Lake
Ontario (including the Saint Lawrence River from Lake Ontario
to the 45th parallel of latitude), and Lake Superior.
(2) Secretary.--The term ``Secretary'' means the Secretary
of Energy.
(b) Study.--
(1) In general.--The Secretary, in consultation with
representatives of appropriate Federal and State agencies,
shall--
(A) conduct a study of--
(i) the location and extent of anticipated growth of
natural gas and other energy transmission infrastructure
proposed to be constructed across the Great Lakes; and
(ii) the environmental impacts of any natural gas or other
energy transmission infrastructure proposed to be constructed
across the Great Lakes; and
(B) make recommendations for minimizing the environmental
impact of pipelines and other energy transmission
infrastructure on the Great Lakes ecosystem.
(2) Advisory Committee.--Not later than 30 days after the
date of enactment of this Act, the Secretary shall enter into
an agreement with the National Academy of Sciences to
establish an advisory committee to ensure that the study is
complete, objective, and of good quality.
(c) Report.--Not later than 1 year after the date of
enactment of this Act, the Secretary shall submit to Congress
a report that describes the findings and recommendations
resulting from the study under subsection (b).

SEC. 1707. NATIONAL ACADEMY OF SCIENCES STUDY OF PROCEDURES
FOR SELECTION AND ASSESSMENT OF CERTAIN ROUTES
FOR SHIPMENT OF SPENT NUCLEAR FUEL FROM
RESEARCH NUCLEAR REACTORS.

(a) In General.--The Secretary of Transportation shall
enter into an agreement with the National Academy of Sciences
under which agreement the National Academy of Sciences shall
conduct a study of the procedures by which the Department of
Energy, together with the Department of Transportation and
the Nuclear Regulatory Commission, selects routes for the
shipment of spent nuclear fuel from research nuclear reactors
between or among existing Department of Energy facilities
currently licensed to accept such spent nuclear fuel.
(b) Elements of Study.--In conducting the study under
subsection (a), the National Academy of Sciences shall
analyze the manner in which the Department of Energy--
(1) selects potential routes for the shipment of spent
nuclear fuel from research nuclear reactors between or among
existing Department facilities currently licensed to accept
such spent nuclear fuel;
(2) selects such a route for a specific shipment of such
spent nuclear fuel; and
(3) conducts assessments of the risks associated with
shipments of such spent nuclear fuel along such a route.
(c) Considerations Regarding Route Selection.--The analysis
under subsection (b) shall include a consideration whether,
and to what extent, the procedures analyzed for purposes of
that subsection take into account the following:
(1) The proximity of the routes under consideration to
major population centers and the risks associated with
shipments of spent nuclear fuel from research nuclear
reactors through densely populated areas.
(2) Current traffic and accident data with respect to the
routes under consideration.
(3) The quality of the roads comprising the routes under
consideration.
(4) Emergency response capabilities along the routes under
consideration.
(5) The proximity of the routes under consideration to
places or venues (including sports stadiums, convention
centers, concert halls and theaters, and other venues) where
large numbers of people gather.
(d) Recommendations.--In conducting the study under
subsection (a), the National Academy of Sciences shall also
make such recommendations regarding the matters studied as
the National Academy of Sciences considers appropriate.
(e) Deadline for Dispersal of Funds for Study.--The
Secretary shall disperse to the National Academy of Sciences
the funds for the cost of the study required by subsection
(a) not later than 30 days after the date of the enactment of
this Act.
(f) Report on Results of Study.--Not later than 6 months
after the date of the dispersal of funds under subsection
(e), the National Academy of Sciences shall submit to the
appropriate committees of Congress a report on the study
conducted under subsection (a), including the recommendations
required by subsection (d).
(g) Appropriate Committees of Congress Defined.--In this
section, the term ``appropriate committees of Congress''
means--
(1) the Committees on Commerce, Science, and
Transportation, Energy and Natural Resources, and Environment
and Public Works of the Senate; and
(2) the Committee on Energy and Commerce of the House of
Representatives.

SEC. 1708. REPORT ON ENERGY SAVINGS AND WATER USE.

(a) Report.--The Secretary of Energy shall conduct a study
of opportunities to reduce energy use by cost-effective
improvements in the efficiency of municipal water and
wastewater treatment and use, including water pumps, motors,
and delivery systems; purification, conveyance and
distribution; upgrading of aging water infrastructure, and
improved methods for leakage monitoring, measuring, and
reporting; and public education.
(b) Submission of Report.--The Secretary of Energy shall
submit a report on the results of the study, including any
recommendations for implementation of measures and estimates
of costs and resource savings, no later than 2 years from the
date of enactment of this section.
(c) Authorization.--There is hereby authorized to be
appropriated such sums as may be necessary to carry out the
purposes of this section.

SEC. 1709. REPORT ON RESEARCH ON HYDROGEN PRODUCTION AND USE.

Not later than 120 days after the date of enactment of this
Act, the Secretary of Energy shall submit to Congress a
report that identifies current or potential research projects
at Department of Energy nuclear facilities relating to the
production or use of hydrogen in fuel cell development or any
other method or process enhancing alternative energy
production technologies.

DIVISION G--ENERGY INFRASTRUCTURE SECURITY

TITLE XVIII--CRITICAL ENERGY INFRASTRUCTURE

Subtitle A--Department of Energy Programs

SEC. 1801. DEFINITIONS.

In this title:
(1) Critical energy infrastructure.--

[[Page S10809]]

(A) In general.--The term ``critical energy
infrastructure'' means a physical or cyber-based system or
service for--
(i) the generation, transmission or distribution of
electric energy; or
(ii) the production, refining, or storage of petroleum,
natural gas, or petroleum product--

the incapacity or destruction of which would have a
debilitating impact on the defense or economic security of
the United States.
(B) Exclusion.--The term shall not include a facility that
is licensed by the Nuclear Regulatory Commission under
section 103 or 104b. of the Atomic Energy Act of 1954 (42
U.S.C. 2133 and 2134(b)).
(2) Department; national laboratory; secretary.--The terms
``Department'', ``National Laboratory'', and ``Secretary''
have the meaning given such terms in section 1203.

SEC. 1802. ROLE OF THE DEPARTMENT OF ENERGY.

Section 102 of the Department of Energy Organization Act
(42 U.S.C. 7112) is amended by adding at the end the
following:
``(20) To ensure the safety, reliability, and security of
the Nation's energy infrastructure, and to respond to any
threat to or disruption of such infrastructure, through
activities including--
``(A) research and development;
``(B) financial assistance, technical assistance, and
cooperative activities with States, industry, and other
interested parties; and
``(C) education and public outreach activities.''.

SEC. 1803. CRITICAL ENERGY INFRASTRUCTURE PROGRAMS.

(a) Programs.--In addition to the authorities otherwise
provided by law (including section 1261), the Secretary is
authorized to establish programs of financial, technical, or
administrative assistance to--
(1) enhance the security of critical energy infrastructure
in the United States;
(2) develop and disseminate, in cooperation with industry,
best practices for critical energy infrastructure assurance;
and
(3) protect against, mitigate the effect of, and improve
the ability to recover from disruptive incidents affecting
critical energy infrastructure.
(b) Requirements.--A program established under this section
shall--
(1) be undertaken in consultation with the advisory
committee established under section 1804;
(2) have available to it the scientific and technical
resources of the Department, including resources at a
National Laboratory; and
(3) be consistent with any overall Federal plan for
national infrastructure security developed by the President
or his designee.

SEC. 1804. ADVISORY COMMITTEE ON ENERGY INFRASTRUCTURE
SECURITY.

(a) Establishment.--The Secretary shall establish an
advisory committee, or utilize an existing advisory committee
within the Department, to advise the Secretary on policies
and programs related to the security of United States energy
infrastructure.
(b) Balanced Membership.--The Secretary shall ensure that
the advisory committee established or utilized under
subsection (a) has a membership with an appropriate balance
among the various interests related to energy infrastructure
security, including--
(1) scientific and technical experts;
(2) industrial managers;
(3) worker representatives;
(4) insurance companies or organizations;
(5) environmental organizations;
(6) representatives of State, local, and tribal
governments; and
(7) such other interests as the Secretary may deem
appropriate.
(c) Expenses.--Members of the advisory committee
established or utilized under subsection (a) shall serve
without compensation, and shall be allowed travel expenses,
including per diem in lieu of subsistence, at rates
authorized for an employee of an agency under subchapter I of
chapter 57 of title 5, United States Code, while away from
the home or regular place of business of the member in the
performance of the duties of the committee.

SEC. 1805. BEST PRACTICES AND STANDARDS FOR ENERGY
INFRASTRUCTURE SECURITY.

The Secretary, in consultation with the advisory committee
under section 1804, shall enter into appropriate arrangements
with one or more standard-setting organizations, or similar
organizations, to assist the development of industry best
practices and standards for security related to protecting
critical energy infrastructure.

Subtitle B--Department of the Interior Programs

SEC. 1811. OUTER CONTINENTAL SHELF ENERGY INFRASTRUCTURE
SECURITY.

(a) Definitions.--In this section:
(1) Approved state plan.--The term ``approved State plan''
means a State plan approved by the Secretary under subsection
(c)(3).
(2) Coastline.--The term ``coastline'' has the same meaning
as the term ``coast line'' as defined in subsection 2(c) of
the Submerged Lands Act (43 U.S.C. 1301(c)).
(3) Critical ocs energy infrastructure facility.--The term
``OCS critical energy infrastructure facility'' means--
(A) a facility located in an OCS Production State or in the
waters of such State related to the production of oil or gas
on the Outer Continental Shelf; or
(B) a related facility located in an OCS Production State
or in the waters of such State that carries out a public
service, transportation, or infrastructure activity critical
to the operation of an Outer Continental Shelf energy
infrastructure facility, as determined by the Secretary.
(4) Distance.--The term ``distance'' means the minimum
great circle distance, measured in statute miles.
(5) Leased tract.--
(A) In general.--The term ``leased tract'' means a tract
that--
(i) is subject to a lease under section 6 or 8 of the Outer
Continental Shelf Lands Act (43 U.S.C. 1335, 1337) for the
purpose of drilling for, developing, and producing oil or
natural gas resources; and
(ii) consists of a block, a portion of a block, a
combination of blocks or portions of blocks, or a combination
of portions of blocks, as--

(I) specified in the lease; and
(II) depicted on an outer Continental Shelf official
protraction diagram.

(B) Exclusion.--The term ``leased tract'' does not include
a tract described in subparagraph (A) that is located in a
geographic area subject to a leasing moratorium on January 1,
2001, unless the lease was in production on that date.
(6) OCS political subdivision.--The term ``OCS political
subdivision'' means a county, parish, borough or any
equivalent subdivision of an OCS Production State all or part
of which subdivision lies within the coastal zone (as defined
in section 304(1) of the Coastal Zone Management Act of 1972
(16 U.S.C. 1453(1)).
(7) OCS production state.--The term ``OCS Production
State'' means the State of--
(A) Alaska;
(B) Alabama;
(C) California;
(D) Florida;
(E) Louisiana;
(F) Mississippi; or
(G) Texas.
(8) Production.--The term ``production'' has the meaning
given the term in section 2 of the Outer Continental Shelf
Lands Act (43 U.S.C. 1331).
(9) Program.--The term ``program'' means the Outer
Continental Shelf Energy Infrastructure Security Program
established under subsection (b).
(10) Qualified outer continental shelf revenues.--The term
``qualified Outer Continental Shelf revenues'' means all
amounts received by the United States from each leased tract
or portion of a leased tract lying seaward of the zone
defined and governed by section 8(g) of the Outer Continental
Shelf Lands Act (43 U.S.C. 1331 et seq.), or lying within
such zone but to which section 8(g) does not apply, the
geographic center of which lies within a distance of 200
miles from any part of the coastline of any State, including
bonus bids, rents, royalties (including payments for
royalties taken in kind and sold), net profit share payments,
and related late payment interest. Such term does not include
any revenues from a leased tract or portion of a leased tract
that is included within any area of the Outer Continental
Shelf where a moratorium on new leasing was in effect as of
January 1, 2001, unless the lease was issued prior to the
establishment of the moratorium and was in production on
January 1, 2001.
(11) Secretary.--The term ``Secretary'' means the Secretary
of the Interior.
(12) State plan.--The term ``State plan'' means a State
plan described in subsection (b).
(b) Establishment.--The Secretary shall establish a
program, to be known as the ``Outer Continental Shelf Energy
Infrastructure Security Program'', under which the Secretary
shall provide funds to OCS Production States to implement
approved State plans to provide security against hostile and
natural threats to critical OCS energy infrastructure
facilities and support of any necessary public service or
transportation activities that are needed to maintain the
safety and operation of critical energy infrastructure
activities. For purposes of this program, restoration of any
coastal wetland shall be considered to be an activity that
secures critical OCS energy infrastructure facilities from a
natural threat.
(c) State Plans.--
(1) Initial plan.--Not later than 180 days after the date
of enactment of this Act, to be eligible to receive funds
under the program, the Governor of an OCS Production State
shall submit to the Secretary a plan to provide security
against hostile and natural threats to critical energy
infrastructure facilities in the OCS Production State and to
support any of the necessary public service or transportation
activities that are needed to maintain the safety and
operation of critical energy infrastructure facilities. Such
plan shall include--
(A) the name of the State agency that will have the
authority to represent and act for the State in dealing with
the Secretary for purposes of this section;
(B) a program for the implementation of the plan which
describes how the amounts provided under this section will be
used;
(C) a contact for each OCS political subdivision and
description of how such political subdivisions will use
amounts provided under this section, including a
certification by the Governor that such uses are consistent
with the requirements of this section; and
(D) measures for taking into account other relevant Federal
resources and programs.
(2) Annual reviews.--Not later than 1 year after the date
of submission of the plan and annually thereafter, the
Governor of an OCS Production State shall--
(A) review the approved State plan; and
(B) submit to the Secretary any revised State plan
resulting from the review.
(3) Approval of plans.--
(A) In general.--In consultation with appropriate Federal
security officials and the Secretaries of Commerce and
Energy, the Secretary shall--
(i) approve each State plan; or
(ii) recommend changes to the State plan.
(B) Resubmission of state plans.--If the Secretary
recommends changes to a State plan under subparagraph
(A)(ii), the Governor of the OCS Production State may
resubmit a revised State plan to the Secretary for approval.

[[Page S10810]]

(4) Availability of plans.--The Secretary shall provide to
Congress a copy of each approved State plan.
(5) Consultation and public comment.--
(A) Consultation.--The Governor of an OCS Production State
shall develop the State plan in consultation with Federal,
State, and local law enforcement and public safety officials,
industry, Indian tribes, the scientific community, and other
persons as appropriate.
(B) Public comment.--The Governor of an OCS Production
State may solicit public comments on the State plan to the
extent that the Governor determines to be appropriate.
(d) Allocation of Amounts by the Secretary.--The Secretary
shall allocate the amounts made available for the purposes of
carrying out the program provided for by this section among
OCS Production States as follows:
(1) twenty-five percent of the amounts shall be divided
equally among OCS Production States.
(2) seventy-five percent of the amounts shall be divided
among OCS Production States on the basis of the proximity of
each OCS Production State to offshore locations at which oil
and gas are being produced.
(e) Calculation.--The amount for each OCS Production State
under paragraph (d)(2) shall be calculated based on the ratio
of qualified OCS revenues generated off the coastline of the
OCS Production State to the qualified OCS revenues generated
off the coastlines of all OCS Production States for the prior
5-year period. Where there is more than one OCS Production
State within 200 miles of a leased tract, the amount of each
OCS Production State's payment under paragraph (d)(2) for
such leased tract shall be inversely proportional to the
distance between the nearest point on the coastline of such
State and the geographic center of each leased tract or
portion of the leased tract (to the nearest whole mile) that
is within 200 miles of that coastline, as determined by the
Secretary. A leased tract or portion of a leased tract shall
be excluded if the tract or portion is located in a
geographic area where a moratorium on new leasing was in
effect on January 1, 2001, unless the lease was issued prior
to the establishment of the moratorium and was in production
on January 1, 2001.
(f) Payments to OCS Political Subdivisions.--Thirty-five
percent of each OCS Production State's allocable share as
determined under subsection (e) shall be paid directly to the
OCS political subdivisions by the Secretary based on the
following formula:
(1) twenty-five percent shall be allocated based on the
ratio of such OCS political subdivision's population to the
population of all OCS political subdivisions in the OCS
Production State.
(2) twenty-five percent shall be allocated based on the
ratio of such OCS political subdivision's coastline miles to
the coastline miles of all OCS political subdivisions in the
OCS Production State. For purposes of this subsection, those
OCS political subdivisions without coastlines shall be
considered to have a coastline that is the average length of
the coastlines of all political subdivisions in the State.
(3) fifty percent shall be allocated based on the relative
distance of such OCS political subdivision from any leased
tract used to calculate that OCS Production State's
allocation using ratios that are inversely proportional to
the distance between the point in the coastal political
subdivision closest to the geographic center of each leased
tract or portion, as determined by the Secretary. For
purposes of the calculations under this subparagraph, a
leased tract or portion of a leased tract shall be excluded
if the leased tract or portion is located in a geographic
area where a moratorium on new leasing was in effect on
January 1, 2001, unless the lease was issued prior to the
establishment of the moratorium and was in production on
January 1, 2001.
(g) Failure To Have Plan Approved.--Any amount allocated to
an OCS Production State or OCS political subdivision but not
disbursed because of a failure to have an approved Plan under
this section shall be allocated equally by the Secretary
among all other OCS Production States in a manner consistent
with this subsection except that the Secretary shall hold in
escrow such amount until the final resolution of any appeal
regarding the disapproval of a plan submitted under this
section. The Secretary may waive the provisions of this
paragraph and hold an OCS Production State's allocable share
in escrow if the Secretary determines that such State is
making a good faith effort to develop and submit, or update,
a Plan.
(h) Use of Amounts Allocated by the Secretary.--
(1) In general.--Amounts allocated by the Secretary under
subsection (d) may be used only in accordance with a plan
approved pursuant to subsection (c) for--
(A) activities to secure critical OCS energy infrastructure
facilities from human or natural threats; and
(B) support of any necessary public service or
transportation activities that are needed to maintain the
safety and operation of critical OCS energy infrastructure
facilities.
(2) Restoration of coastal wetland.--For the purpose of
subparagraph (1)(A), restoration of any coastal wetland shall
be considered to be an activity that secures critical OCS
energy infrastructure facilities from a natural threat.
(i) Failure To Have Use.--Any amount allocated to an OCS
political subdivision but not disbursed because of a failure
to have a qualifying use as described in subsection (h) shall
be allocated by the Secretary to the OCS Production State in
which the OCS political subdivision is located except that
the Secretary shall hold in escrow such amount until the
final resolution of any appeal regarding the use of the
funds.
(j) Compliance With Authorized Uses.--If the Secretary
determines that any expenditure made by an OCS Production
State or an OCS political subdivision is not consistent with
the uses authorized in subsection (h), the Secretary shall
not disburse any further amounts under this section to that
OCS Production State or OCS political subdivision until the
amounts used for the inconsistent expenditure have been
repaid or obligated for authorized uses.
(k) Rulemaking.--The Secretary may promulgate such rules
and regulations as may be necessary to carry out the purposes
of this section, including rules and regulations setting
forth an appropriate process for appeals.
(l) Authorization of Appropriations.--There are hereby
authorized to be appropriated $450,000,000 for each of the
fiscal years 2003 through 2008 to carry out the purposes of
this section.

DIVISION H--ENERGY TAX INCENTIVES

SEC. 1900. SHORT TITLE; ETC.

(a) Short Title.--This division may be cited as the
``Energy Tax Incentives Act of 2003''.
(b) Amendment of 1986 Code.--Except as otherwise expressly
provided, whenever in this division 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.

TITLE XIX--EXTENSION AND MODIFICATION OF RENEWABLE ELECTRICITY
PRODUCTION TAX CREDIT

SEC. 1901. THREE-YEAR EXTENSION OF CREDIT FOR PRODUCING
ELECTRICITY FROM WIND AND POULTRY WASTE.

(a) In General.--Subparagraphs (A) and (C) of section
45(c)(3) (relating to qualified facility), as amended by
section 603(a) of the Job Creation and Worker Assistance Act
of 2002, are each amended by striking ``January 1, 2004'' and
inserting ``January 1, 2007''.
(b) Effective Date.--The amendments made by this section
shall apply to electricity sold after the date of the
enactment of this Act, in taxable years ending after such
date.

SEC. 1902. CREDIT FOR ELECTRICITY PRODUCED FROM BIOMASS.

(a) Extension and Modification of Placed-In-Service
Rules.--Paragraph (3) of section 45(c) is amended--
(1) by striking subparagraph (B) and inserting the
following new subparagraph:
``(B) Closed-loop biomass facility.--
``(i) In general.--In the case of a facility using closed-
loop biomass to produce electricity, the term `qualified
facility' means any facility--

``(I) owned by the taxpayer which is originally placed in
service after December 31, 1992, and before January 1, 2007,
or
``(II) owned by the taxpayer which is originally placed in
service before January 1, 1993, and modified to use closed-
loop biomass to co-fire with coal before January 1, 2007, as
approved under the Biomass Power for Rural Development
Programs or under a pilot project of the Commodity Credit
Corporation as described in 65 Fed. Reg. 63052.

``(ii) Special rules.--In the case of a qualified facility
described in clause (i)(II)--

``(I) the 10-year period referred to in subsection (a)
shall be treated as beginning no earlier than the date of the
enactment of this subclause, and
``(II) if the owner of such facility is not the producer of
the electricity, the person eligible for the credit allowable
under subsection (a) is the lessee or the operator of such
facility.'', and

(2) by adding at the end the following new subparagraph:
``(D) Biomass facility.--
``(i) In general.--In the case of a facility using biomass
(other than closed-loop biomass) to produce electricity, the
term `qualified facility' means any facility owned by the
taxpayer which is originally placed in service before January
1, 2005.
``(ii) Special rule for posteffective date facilities.--In
the case of any facility described in clause (i) which is
placed in service after the date of the enactment of this
clause, the 3-year period beginning on the date the facility
is originally placed in service shall be substituted for the
10-year period in subsection (a)(2)(A)(ii).
``(iii) Special rules for preeffective date facilities.--In
the case of any facility described in clause (i) which is
placed in service before the date of the enactment of this
clause--

``(I) subsection (a)(1) shall be applied by substituting
`1.0 cents' for `1.5 cents', and
``(II) the 3-year period beginning after December 31, 2002,
shall be substituted for the 10-year period in subsection
(a)(2)(A)(ii).

``(iv) Credit eligibility.--In the case of any facility
described in clause (i), if the owner of such facility is not
the producer of the electricity, the person eligible for the
credit allowable under subsection (a) is the lessee or the
operator of such facility.''.
(b) Definition of Biomass.--
(1) In general.--Section 45(c)(1) (defining qualified
energy resources) is amended--
(A) by striking ``and'' at the end of subparagraph (B),
(B) by striking the period at the end of subparagraph (C)
and inserting ``, and'', and
(C) by adding at the end the following new subparagraph:
``(D) biomass (other than closed-loop biomass).''.
(2) Biomass defined.--Section 45(c) (relating to
definitions) is amended by adding at the end the following
new paragraph:
``(5) Biomass.--The term `biomass' means any solid,
nonhazardous, cellulosic waste material which is segregated
from other waste materials and which is derived from--
``(A) any of the following forest-related resources: mill
residues, precommercial thinnings, slash, and brush, but not
including old-growth timber (other than old-growth timber
which has

[[Page S10811]]

been permitted or contracted for removal by any appropriate
Federal authority through the National Environmental Policy
Act or by any appropriate State authority),
``(B) solid wood waste materials, including waste pallets,
crates, dunnage, manufacturing and construction wood wastes
(other than pressure-treated, chemically-treated, or painted
wood wastes), and landscape or right-of-way tree trimmings,
but not including municipal solid waste (garbage), gas
derived from the biodegradation of solid waste, or paper that
is commonly recycled, or
``(C) agriculture sources, including orchard tree crops,
vineyard, grain, legumes, sugar, and other crop by-products
or residues.''.
(c) Coordination With Section 29.--Section 45(c) (relating
to definitions) is amended by adding at the end the following
new paragraph:
``(6) Coordination with section 29.--The term `qualified
facility' shall not include any facility the production from
which is taken into account in determining any credit under
section 29 for the taxable year or any prior taxable year.''.
(d) Clerical Amendments.--
(1) The heading for subsection (c) of section 45 is amended
by inserting ``and Special Rules'' after ``Definitions''.
(2) The heading for subsection (d) of section 45 is amended
by inserting ``Additional'' before ``Definitions''.
(e) Effective Dates.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall apply to electricity
sold after the date of the enactment of this Act.
(2) Certain biomass facilities.--With respect to any
facility described in section 45(c)(3)(D)(i) of the Internal
Revenue Code of 1986, as added by this section, which is
placed in service before the date of the enactment of this
Act, the amendments made by this section shall apply to
electricity sold after December 31, 2002.

SEC. 1903. CREDIT FOR ELECTRICITY PRODUCED FROM SWINE AND
BOVINE WASTE NUTRIENTS, GEOTHERMAL ENERGY, AND
SOLAR ENERGY.

(a) Expansion of Qualified Energy Resources.--
(1) In general.--Section 45(c)(1) (defining qualified
energy resources), as amended by this Act, is amended by
striking ``and'' at the end of subparagraph (C), by striking
the period at the end of subparagraph (D) and inserting a
comma, and by adding at the end the following new
subparagraphs:
``(E) swine and bovine waste nutrients,
``(F) geothermal energy, and
``(G) solar energy.''.
(2) Definitions.--Section 45(c) (relating to definitions
and special rules), as amended by this Act, is amended by
redesignating paragraph (6) as paragraph (8) and by inserting
after paragraph (5) the following new paragraphs:
``(6) Swine and bovine waste nutrients.--The term `swine
and bovine waste nutrients' means swine and bovine manure and
litter, including bedding material for the disposition of
manure.
``(7) Geothermal energy.--The term `geothermal energy'
means energy derived from a geothermal deposit (within the
meaning of section 613(e)(2)).''.
(b) Extension and Modification of Placed-In-Service
Rules.--Section 45(c)(3) (relating to qualified facility), as
amended by this Act, is amended by adding at the end the
following new subparagraphs:
``(E) Swine and bovine waste nutrients facility.--In the
case of a facility using swine and bovine waste nutrients to
produce electricity, the term `qualified facility' means any
facility owned by the taxpayer which is originally placed in
service after the date of the enactment of this subparagraph
and before January 1, 2007.
``(F) Geothermal or solar energy facility.--
``(i) In general.--In the case of a facility using
geothermal or solar energy to produce electricity, the term
`qualified facility' means any facility owned by the taxpayer
which is originally placed in service after the date of the
enactment of this clause and before January 1, 2007.
``(ii) Special rule.--In the case of any facility described
in clause (i), the 5-year period beginning on the date the
facility was originally placed in service shall be
substituted for the 10-year period in subsection
(a)(2)(A)(ii).''.
(d) Effective Date.--The amendments made by this section
shall apply to electricity sold after the date of the
enactment of this Act, in taxable years ending after such
date.

SEC. 1904. TREATMENT OF PERSONS NOT ABLE TO USE ENTIRE
CREDIT.

(a) In General.--Section 45(d) (relating to additional
definitions and special rules), as amended by this Act, is
amended by adding at the end the following new paragraph:
``(8) Treatment of persons not able to use entire credit.--
``(A) Allowance of credit.--
``(i) In general.--Except as otherwise provided in this
subsection--

``(I) any credit allowable under subsection (a) with
respect to a qualified facility owned by a person described
in clause (ii) may be transferred or used as provided in this
paragraph, and
``(II) the determination as to whether the credit is
allowable shall be made without regard to the tax-exempt
status of the person.

``(ii) Persons described.--A person is described in this
clause if the person is--

``(I) an organization described in section 501(c)(12)(C)
and exempt from tax under section 501(a),
``(II) an organization described in section 1381(a)(2)(C),
``(III) a public utility (as defined in section
136(c)(2)(B)), which is exempt from income tax under this
subtitle,
``(IV) any State or political subdivision thereof, the
District of Columbia, any possession of the United States, or
any agency or instrumentality of any of the foregoing, or
``(V) any Indian tribal government (within the meaning of
section 7871) or any agency or instrumentality thereof.

``(B) Transfer of credit.--
``(i) In general.--A person described in subparagraph
(A)(ii) may transfer any credit to which subparagraph (A)(i)
applies through an assignment to any other person not
described in subparagraph (A)(ii). Such transfer may be
revoked only with the consent of the Secretary.
``(ii) Regulations.--The Secretary shall prescribe such
regulations as necessary to ensure that any credit described
in clause (i) is claimed once and not reassigned by such
other person.
``(iii) Transfer proceeds treated as arising from essential
government function.--Any proceeds derived by a person
described in subclause (III), (IV), or (V) of subparagraph
(A)(ii) from the transfer of any credit under clause (i)
shall be treated as arising from the exercise of an essential
government function.
``(C) Use of credit as an offset.--Notwithstanding any
other provision of law, in the case of a person described in
subclause (I), (II), or (V) of subparagraph (A)(ii), any
credit to which subparagraph (A)(i) applies may be applied by
such person, to the extent provided by the Secretary of
Agriculture, as a prepayment of any loan, debt, or other
obligation the entity has incurred under subchapter I of
chapter 31 of title 7 of the Rural Electrification Act of
1936 (7 U.S.C. 901 et seq.), as in effect on the date of the
enactment of the Energy Tax Incentives Act of 2003.
``(D) Credit not income.--Any transfer under subparagraph
(B) or use under subparagraph (C) of any credit to which
subparagraph (A)(i) applies shall not be treated as income
for purposes of section 501(c)(12).
``(E) Treatment of unrelated persons.--For purposes of
subsection (a)(2)(B), sales among and between persons
described in subparagraph (A)(ii) shall be treated as sales
between unrelated parties.''.
(b) Credits Not Reduced by Tax-Exempt Bonds or Certain
Other Subsidies.--Section 45(b)(3) (relating to credit
reduced for grants, tax-exempt bonds, subsidized energy
financing, and other credits) is amended--
(1) by striking clause (ii),
(2) by redesignating clauses (iii) and (iv) as clauses (ii)
and (iii),
(3) by inserting ``(other than any loan, debt, or other
obligation incurred under subchapter I of chapter 31 of title
7 of the Rural Electrification Act of 1936 (7 U.S.C. 901 et
seq.), as in effect on the date of the enactment of the
Energy Tax Incentives Act of 2003)'' after ``project'' in
clause (ii) (as so redesignated),
(4) by adding at the end the following new sentence: ``This
paragraph shall not apply with respect to any facility
described in subsection (c)(3)(B)(i)(II).'', and
(5) by striking ``tax-exempt bonds,'' in the heading and
inserting ``certain''.
(c) Effective Date.--The amendments made by this section
shall apply to electricity sold after the date of the
enactment of this Act, in taxable years ending after such
date.

SEC. 1905. CREDIT FOR ELECTRICITY PRODUCED FROM SMALL
IRRIGATION POWER.

(a) In General.--Section 45(c)(1) (defining qualified
energy resources), as amended by this Act, is amended by
striking ``and'' at the end of subparagraph (F), by striking
the period at the end of subparagraph (G) and inserting ``,
and'', and by adding at the end the following new
subparagraph:
``(H) small irrigation power.''.
(b) Qualified Facility.--Section 45(c)(3) (relating to
qualified facility), as amended by this Act, is amended by
adding at the end the following new subparagraph:
``(G) Small irrigation power facility.--In the case of a
facility using small irrigation power to produce electricity,
the term `qualified facility' means any facility owned by the
taxpayer which is originally placed in service after date of
the enactment of this subparagraph and before January 1,
2007.''.
(c) Definition.--Section 45(c), as amended by this Act, is
amended by redesignating paragraph (8) as paragraph (9) and
by inserting after paragraph (7) the following new paragraph:
``(8) Small irrigation power.--The term `small irrigation
power' means power--
``(A) generated without any dam or impoundment of water
through an irrigation system canal or ditch, and
``(B) the installed capacity of which is less than 5
megawatts.''.
(d) Effective Date.--The amendments made by this section
shall apply to electricity sold after the date of the
enactment of this Act, in taxable years ending after such
date.

SEC. 1906. CREDIT FOR ELECTRICITY PRODUCED FROM MUNICIPAL
BIOSOLIDS AND RECYCLED SLUDGE.

(a) In General.--Section 45(c)(1) (defining qualified
energy resources), as amended by this Act, is amended by
striking ``and'' at the end of subparagraph (F), by striking
the period at the end of subparagraph (G), and by adding at
the end the following new subparagraphs:
``(H) municipal biosolids, and
``(I) recycled sludge.''.
(b) Qualified Facilities.--Section 45(c)(3) (relating to
qualified facility), as amended by this Act, is amended by
adding at the end the following new subparagraphs:
``(G) Municipal biosolids facility.--In the case of a
facility using municipal biosolids to produce electricity,
the term `qualified facility' means any facility owned by the
taxpayer which is originally placed in service after December
31, 2001, and before January 1, 2007.

[[Page S10812]]

``(H) Recycled sludge facility.--
``(i) In general.--In the case of a facility using recycled
sludge to produce electricity, the term `qualified facility'
means any facility owned by the taxpayer which is originally
placed in service before January 1, 2007.
``(ii) Special rule.--In the case of a qualified facility
described in clause (i), the 10-year period referred to in
subsection (a) shall be treated as beginning no earlier than
the date of the enactment of this subparagraph.''.
(c) Definitions.--Section 45(c), as amended by this Act, is
amended by redesignating paragraph (8) as paragraph (10) and
by inserting after paragraph (7) the following new
paragraphs:
``(8) Municipal biosolids.--The term `municipal biosolids'
means the residue or solids removed by a municipal wastewater
treatment facility.
``(9) Recycled sludge.--
``(A) In general.--The term `recycled sludge' means the
recycled residue byproduct created in the treatment of
commercial, industrial, municipal, or navigational
wastewater.
``(B) Recycled.--The term `recycled' means the processing
of residue into a marketable product, but does not include
incineration for the purpose of volume reduction.''.
(d) Effective Date.--The amendments made by this section
shall apply to electricity sold after the date of the
enactment of this Act, in taxable years ending after such
date.

TITLE XX--ALTERNATIVE MOTOR VEHICLES AND FUELS INCENTIVES

SEC. 2001. ALTERNATIVE MOTOR VEHICLE CREDIT.

(a) In General.--Subpart B of part IV of subchapter A of
chapter 1 (relating to foreign tax credit, etc.) is amended
by adding at the end the following new section:

``SEC. 30B. ALTERNATIVE MOTOR VEHICLE CREDIT.

``(a) Allowance of Credit.--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--
``(1) the new qualified fuel cell motor vehicle credit
determined under subsection (b),
``(2) the new qualified hybrid motor vehicle credit
determined under subsection (c), and
``(3) the new qualified alternative fuel motor vehicle
credit determined under subsection (d).
``(b) New Qualified Fuel Cell Motor Vehicle Credit.--
``(1) In general.--For purposes of subsection (a), the new
qualified fuel cell motor vehicle credit determined under
this subsection with respect to a new qualified fuel cell
motor vehicle placed in service by the taxpayer during the
taxable year is--
``(A) $4,000, if such vehicle has a gross vehicle weight
rating of not more than 8,500 pounds,
``(B) $10,000, if such vehicle has a gross vehicle weight
rating of more than 8,500 pounds but not more than 14,000
pounds,
``(C) $20,000, if such vehicle has a gross vehicle weight
rating of more than 14,000 pounds but not more than 26,000
pounds, and
``(D) $40,000, if such vehicle has a gross vehicle weight
rating of more than 26,000 pounds.
``(2) Increase for fuel efficiency.--
``(A) In general.--The amount determined under paragraph
(1)(A) with respect to a new qualified fuel cell motor
vehicle which is a passenger automobile or light truck shall
be increased by--
``(i) $1,000, if such vehicle achieves at least 150 percent
but less than 175 percent of the 2000 model year city fuel
economy,
``(ii) $1,500, if such vehicle achieves at least 175
percent but less than 200 percent of the 2000 model year city
fuel economy,
``(iii) $2,000, if such vehicle achieves at least 200
percent but less than 225 percent of the 2000 model year city
fuel economy,
``(iv) $2,500, if such vehicle achieves at least 225
percent but less than 250 percent of the 2000 model year city
fuel economy,
``(v) $3,000, if such vehicle achieves at least 250 percent
but less than 275 percent of the 2000 model year city fuel
economy,
``(vi) $3,500, if such vehicle achieves at least 275
percent but less than 300 percent of the 2000 model year city
fuel economy, and
``(vii) $4,000, if such vehicle achieves at least 300
percent of the 2000 model year city fuel economy.
``(B) 2000 model year city fuel economy.--For purposes of
subparagraph (A), the 2000 model year city fuel economy with
respect to a vehicle shall be determined in accordance with
the following tables:
``(i) In the case of a passenger automobile:
``If vehicle inertia weight clThe 2000 model year city fuel economy is:
1,500 or 1,750 lbs............................................43.7 mpg
2,000 lbs.....................................................38.3 mpg
2,250 lbs.....................................................34.1 mpg
2,500 lbs.....................................................30.7 mpg
2,750 lbs.....................................................27.9 mpg
3,000 lbs.....................................................25.6 mpg
3,500 lbs.....................................................22.0 mpg
4,000 lbs.....................................................19.3 mpg
4,500 lbs.....................................................17.2 mpg
5,000 lbs.....................................................15.5 mpg
5,500 lbs.....................................................14.1 mpg
6,000 lbs.....................................................12.9 mpg
6,500 lbs.....................................................11.9 mpg
7,000 to 8,500 lbs............................................11.1 mpg.
``(ii) In the case of a light truck:

``If vehicle inertia weight clThe 2000 model year city fuel economy is:
1,500 or 1,750 lbs............................................37.6 mpg
2,000 lbs.....................................................33.7 mpg
2,250 lbs.....................................................30.6 mpg
2,500 lbs.....................................................28.0 mpg
2,750 lbs.....................................................25.9 mpg
3,000 lbs.....................................................24.1 mpg
3,500 lbs.....................................................21.3 mpg
4,000 lbs.....................................................19.0 mpg
4,500 lbs.....................................................17.3 mpg
5,000 lbs.....................................................15.8 mpg
5,500 lbs.....................................................14.6 mpg
6,000 lbs.....................................................13.6 mpg
6,500 lbs.....................................................12.8 mpg
7,000 to 8,500 lbs............................................12.0 mpg.

``(C) Vehicle inertia weight class.--For purposes of
subparagraph (B), the term `vehicle inertia weight class' has
the same meaning as when defined in regulations prescribed by
the Administrator of the Environmental Protection Agency for
purposes of the administration of title II of the Clean Air
Act (42 U.S.C. 7521 et seq.).
``(3) New qualified fuel cell motor vehicle.--For purposes
of this subsection, the term `new qualified fuel cell motor
vehicle' means a motor vehicle--
``(A) which is propelled by power derived from one or more
cells which convert chemical energy directly into electricity
by combining oxygen with hydrogen fuel which is stored on
board the vehicle in any form and may or may not require
reformation prior to use,
``(B) which, in the case of a passenger automobile or light
truck--
``(i) for 2002 and later model vehicles, has received a
certificate of conformity under the Clean Air Act and meets
or exceeds the equivalent qualifying California low emission
vehicle standard under section 243(e)(2) of the Clean Air Act
for that make and model year, and
``(ii) for 2004 and later model vehicles, has received a
certificate that such vehicle meets or exceeds the Bin 5 Tier
II emission level established in regulations prescribed by
the Administrator of the Environmental Protection Agency
under section 202(i) of the Clean Air Act for that make and
model year vehicle,
``(C) the original use of which commences with the
taxpayer,
``(D) which is acquired for use or lease by the taxpayer
and not for resale, and
``(E) which is made by a manufacturer.
``(c) New Qualified Hybrid Motor Vehicle Credit.--
``(1) In general.--For purposes of subsection (a), the new
qualified hybrid motor vehicle credit determined under this
subsection with respect to a new qualified hybrid motor
vehicle placed in service by the taxpayer during the taxable
year is the credit amount determined under paragraph (2).
``(2) Credit amount.--
``(A) In general.--The credit amount determined under this
paragraph shall be determined in accordance with the
following tables:
``(i) In the case of a new qualified hybrid motor vehicle
which is a passenger automobile or light truck and which
provides the following percentage of the maximum available
power:

``If percentage of the
maximum                                                    The credit
available power is:                                        amount is:
At least 5 percent but less than 10 percent.......................$250
At least 10 percent but less than 20 percent......................$500
At least 20 percent but less than 30 percent......................$750
At least 30 percent.............................................$1,000.

``(ii) In the case of a new qualified hybrid motor vehicle
which is a heavy duty hybrid motor vehicle and which provides
the following percentage of the maximum available power:

``(I) If such vehicle has a gross vehicle weight rating of
not more than 14,000 pounds:

``If percentage of the
maximum                                                    The credit
available power is:                                        amount is:
At least 20 percent but less than 30 percent....................$1,000
At least 30 percent but less than 40 percent....................$1,750
At least 40 percent but less than 50 percent....................$2,000
At least 50 percent but less than 60 percent....................$2,250
At least 60 percent.............................................$2,500.

``(II) If such vehicle has a gross vehicle weight rating of
more than 14,000 but not more than 26,000 pounds:

``If percentage of the
maximum                                                    The credit
available power is:                                        amount is:
At least 20 percent but less than 30 percent....................$4,000
At least 30 percent but less than 40 percent....................$4,500
At least 40 percent but less than 50 percent....................$5,000
At least 50 percent but less than 60 percent....................$5,500
At least 60 percent.............................................$6,000.

``(III) If such vehicle has a gross vehicle weight rating
of more than 26,000 pounds:

``If percentage of the
maximum                                                    The credit
available power is:                                        amount is:
At least 20 percent but less than 30 percent....................$6,000
At least 30 percent but less than 40 percent....................$7,000
At least 40 percent but less than 50 percent....................$8,000
At least 50 percent but less than 60 percent....................$9,000
At least 60 percent............................................$10,000.

``(B) Increase for fuel efficiency.--
``(i) Amount.--The amount determined under subparagraph
(A)(i) with respect to a new qualified hybrid motor vehicle
which is a passenger automobile or light truck shall be
increased by--

``(I) $500, if such vehicle achieves at least 125 percent
but less than 150 percent of the 2000 model year city fuel
economy,
``(II) $1,000, if such vehicle achieves at least 150
percent but less than 175 percent of the 2000 model year city
fuel economy,
``(III) $1,500, if such vehicle achieves at least 175
percent but less than 200 percent of the 2000 model year city
fuel economy,

[[Page S10813]]

``(IV) $2,000, if such vehicle achieves at least 200
percent but less than 225 percent of the 2000 model year city
fuel economy,
``(V) $2,500, if such vehicle achieves at least 225 percent
but less than 250 percent of the 2000 model year city fuel
economy, and
``(VI) $3,000, if such vehicle achieves at least 250
percent of the 2000 model year city fuel economy.

``(ii) 2000 model year city fuel economy.--For purposes of
clause (i), the 2000 model year city fuel economy with
respect to a vehicle shall be determined using the tables
provided in subsection (b)(2)(B) with respect to such
vehicle.
``(C) Increase for accelerated emissions performance.--The
amount determined under subparagraph (A)(ii) with respect to
an applicable heavy duty hybrid motor vehicle shall be
increased by the increased credit amount determined in
accordance with the following tables:
``(i) In the case of a vehicle which has a gross vehicle
weight rating of not more than 14,000 pounds:

The increased credit
``If the model year is:                                      amount is:
2002............................................................$3,500
2003............................................................$3,000
2004............................................................$2,500
2005............................................................$2,000
2006............................................................$1,500.

``(ii) In the case of a vehicle which has a gross vehicle
weight rating of more than 14,000 pounds but not more than
26,000 pounds:

The increased credit
``If the model year is:                                      amount is:
2002............................................................$9,000
2003............................................................$7,750
2004............................................................$6,500
2005............................................................$5,250
2006............................................................$4,000.

``(iii) In the case of a vehicle which has a gross vehicle
weight rating of more than 26,000 pounds:

The increased credit
``If the model year is:                                      amount is:
2002...........................................................$14,000
2003...........................................................$12,000
2004...........................................................$10,000
2005............................................................$8,000
2006............................................................$6,000.

``(D) Definitions.--
``(i) Applicable heavy duty hybrid motor vehicle.--For
purposes of subparagraph (C), the term `applicable heavy duty
hybrid motor vehicle' means a heavy duty hybrid motor vehicle
which is powered by an internal combustion or heat engine
which is certified as meeting the emission standards set in
the regulations prescribed by the Administrator of the
Environmental Protection Agency for 2007 and later model year
diesel heavy duty engines, or for 2008 and later model year
ottocycle heavy duty engines, as applicable.
``(ii) Heavy duty hybrid motor vehicle.--For purposes of
this paragraph, the term `heavy duty hybrid motor vehicle'
means a new qualified hybrid motor vehicle which has a gross
vehicle weight rating of more than 10,000 pounds and draws
propulsion energy from both of the following onboard sources
of stored energy:

``(I) An internal combustion or heat engine using
consumable fuel which, for 2002 and later model vehicles, has
received a certificate of conformity under the Clean Air Act
and meets or exceeds a level of not greater than 3.0 grams
per brake horsepower-hour of oxides of nitrogen and 0.01 per
brake horsepower-hour of particulate matter.
``(II) A rechargeable energy storage system.

``(iii) Maximum available power.--

``(I) Passenger automobile or light truck.--For purposes of
subparagraph (A)(i), the term `maximum available power' means
the maximum power available from the rechargeable energy
storage system, during a standard 10 second pulse power or
equivalent test, divided by such maximum power and the SAE
net power of the heat engine.
``(II) Heavy duty hybrid motor vehicle.--For purposes of
subparagraph (A)(ii), the term `maximum available power'
means the maximum power available from the rechargeable
energy storage system, during a standard 10 second pulse
power or equivalent test, divided by the vehicle's total
traction power. The term `total traction power' means the sum
of the peak power from the rechargeable energy storage system
and the heat engine peak power of the vehicle, except that if
such storage system is the sole means by which the vehicle
can be driven, the total traction power is the peak power of
such storage system.

``(3) New qualified hybrid motor vehicle.--For purposes of
this subsection, the term `new qualified hybrid motor
vehicle' means a motor vehicle--
``(A) which draws propulsion energy from onboard sources of
stored energy which are both--
``(i) an internal combustion or heat engine using
combustible fuel, and
``(ii) a rechargeable energy storage system,
``(B) which, in the case of a passenger automobile or light
truck--
``(i) for 2002 and later model vehicles, has received a
certificate of conformity under the Clean Air Act and meets
or exceeds the equivalent qualifying California low emission
vehicle standard under section 243(e)(2) of the Clean Air Act
for that make and model year, and
``(ii) for 2004 and later model vehicles, has received a
certificate that such vehicle meets or exceeds the Bin 5 Tier
II emission level established in regulations prescribed by
the Administrator of the Environmental Protection Agency
under section 202(i) of the Clean Air Act for that make and
model year vehicle,
``(C) the original use of which commences with the
taxpayer,
``(D) which is acquired for use or lease by the taxpayer
and not for resale, and
``(E) which is made by a manufacturer.
``(d) New Qualified Alternative Fuel Motor Vehicle
Credit.--
``(1) Allowance of credit.--Except as provided in paragraph
(5), the credit determined under this subsection is an amount
equal to the applicable percentage of the incremental cost of
any new qualified alternative fuel motor vehicle placed in
service by the taxpayer during the taxable year.
``(2) Applicable percentage.--For purposes of paragraph
(1), the applicable percentage with respect to any new
qualified alternative fuel motor vehicle is--
``(A) 40 percent, plus
``(B) 30 percent, if such vehicle--
``(i) has received a certificate of conformity under the
Clean Air Act and meets or exceeds the most stringent
standard available for certification under the Clean Air Act
for that make and model year vehicle (other than a zero
emission standard), or
``(ii) has received an order certifying the vehicle as
meeting the same requirements as vehicles which may be sold
or leased in California and meets or exceeds the most
stringent standard available for certification under the
State laws of California (enacted in accordance with a waiver
granted under section 209(b) of the Clean Air Act) for that
make and model year vehicle (other than a zero emission
standard).
``(3) Incremental cost.--For purposes of this subsection,
the incremental cost of any new qualified alternative fuel
motor vehicle is equal to the amount of the excess of the
manufacturer's suggested retail price for such vehicle over
such price for a gasoline or diesel fuel motor vehicle of the
same model, to the extent such amount does not exceed--
``(A) $5,000, if such vehicle has a gross vehicle weight
rating of not more than 8,500 pounds,
``(B) $10,000, if such vehicle has a gross vehicle weight
rating of more than 8,500 pounds but not more than 14,000
pounds,
``(C) $25,000, if such vehicle has a gross vehicle weight
rating of more than 14,000 pounds but not more than 26,000
pounds, and
``(D) $40,000, if such vehicle has a gross vehicle weight
rating of more than 26,000 pounds.
``(4) Qualified alternative fuel motor vehicle defined.--
For purposes of this subsection--
``(A) In general.--The term `qualified alternative fuel
motor vehicle' means any motor vehicle--
``(i) which is only capable of operating on an alternative
fuel,
``(ii) the original use of which commences with the
taxpayer,
``(iii) which is acquired by the taxpayer for use or lease,
but not for resale, and
``(iv) which is made by a manufacturer.
``(B) Alternative fuel.--The term `alternative fuel' means
compressed natural gas, liquefied natural gas, liquefied
petroleum gas, hydrogen, and any liquid at least 85 percent
of the volume of which consists of methanol.
``(5) Credit for mixed-fuel vehicles.--
``(A) In general.--In the case of a mixed-fuel vehicle
placed in service by the taxpayer during the taxable year,
the credit determined under this subsection is an amount
equal to--
``(i) in the case of a 75/25 mixed-fuel vehicle, 70 percent
of the credit which would have been allowed under this
subsection if such vehicle was a qualified alternative fuel
motor vehicle, and
``(ii) in the case of a 90/10 mixed-fuel vehicle, 90
percent of the credit which would have been allowed under
this subsection if such vehicle was a qualified alternative
fuel motor vehicle.
``(B) Mixed-fuel vehicle.--For purposes of this subsection,
the term `mixed-fuel vehicle' means any motor vehicle
described in subparagraph (C) or (D) of paragraph (3),
which--
``(i) is certified by the manufacturer as being able to
perform efficiently in normal operation on a combination of
an alternative fuel and a petroleum-based fuel,
``(ii) either--

``(I) has received a certificate of conformity under the
Clean Air Act, or
``(II) has received an order certifying the vehicle as
meeting the same requirements as vehicles which may be sold
or leased in California and meets or exceeds the low emission
vehicle standard under section 88.105-94 of title 40, Code of
Federal Regulations, for that make and model year vehicle,

``(iii) the original use of which commences with the
taxpayer,
``(iv) which is acquired by the taxpayer for use or lease,
but not for resale, and
``(v) which is made by a manufacturer.
``(C) 75/25 mixed-fuel vehicle.--For purposes of this
subsection, the term `75/25 mixed-fuel vehicle' means a
mixed-fuel vehicle which operates using at least 75 percent
alternative fuel and not more than 25 percent petroleum-based
fuel.
``(D) 90/10 mixed-fuel vehicle.--For purposes of this
subsection, the term `90/10 mixed-fuel vehicle' means a
mixed-fuel vehicle which operates using at least 90 percent
alternative fuel and not more than 10 percent petroleum-based
fuel.
``(e) Application With Other Credits.--The credit allowed
under subsection (a) for any taxable year shall not exceed
the excess (if any) of--
``(1) the regular tax for the taxable year reduced by the
sum of the credits allowable under subpart A and sections 27,
29, and 30, over
``(2) the tentative minimum tax for the taxable year.
``(f) Other Definitions and Special Rules.--For purposes of
this section--
``(1) Consumable fuel.--The term `consumable fuel' means
any solid, liquid, or gaseous matter which releases energy
when consumed by an auxiliary power unit.
``(2) Motor vehicle.--The term `motor vehicle' has the
meaning given such term by section 30(c)(2).

[[Page S10814]]

``(3) City fuel economy.--The city fuel economy with
respect to any vehicle shall be measured in a manner which is
substantially similar to the manner city fuel economy is
measured in accordance with procedures under part 600 of
subchapter Q of chapter I of title 40, Code of Federal
Regulations, as in effect on the date of the enactment of
this section.
``(4) Other terms.--The terms `automobile', `passenger
automobile', `light truck', and `manufacturer' have the
meanings given such terms in regulations prescribed by the
Administrator of the Environmental Protection Agency for
purposes of the administration of title II of the Clean Air
Act (42 U.S.C. 7521 et seq.).
``(5)  Reduction in basis.--For purposes of this subtitle,
the basis of any property for which a credit is allowable
under subsection (a) shall be reduced by the amount of such
credit so allowed (determined without regard to subsection
(e)).
``(6) No double benefit.--The amount of any deduction or
other credit allowable under this chapter--
``(A) for any incremental cost taken into account in
computing the amount of the credit determined under
subsection (d) shall be reduced by the amount of such credit
attributable to such cost, and
``(B) with respect to a vehicle described under subsection
(b) or (c), shall be reduced by the amount of credit allowed
under subsection (a) for such vehicle for the taxable year.
``(7) Property used by tax-exempt entities.--In the case of
a credit amount which is allowable with respect to a motor
vehicle which is acquired by an entity exempt from tax under
this chapter, the person which sells or leases such vehicle
to the entity shall be treated as the taxpayer with respect
to the vehicle for purposes of this section and the credit
shall be allowed to such person, but only if the person
clearly discloses to the entity at the time of any sale or
lease the specific amount of any credit otherwise allowable
to the entity under this section.
``(8) Recapture.--The Secretary shall, by regulations,
provide for recapturing the benefit of any credit allowable
under subsection (a) with respect to any property which
ceases to be property eligible for such credit (including
recapture in the case of a lease period of less than the
economic life of a vehicle).
``(9) Property used outside united states, etc., not
qualified.--No credit shall be allowed under subsection (a)
with respect to any property referred to in section 50(b) or
with respect to the portion of the cost of any property taken
into account under section 179.
``(10) Election to not take credit.--No credit shall be
allowed under subsection (a) for any vehicle if the taxpayer
elects to not have this section apply to such vehicle.
``(11) Carryback and carryforward allowed.--
``(A) In general.--If the credit amount allowable under
subsection (a) for a taxable year exceeds the amount of the
limitation under subsection (e) for such taxable year (in
this paragraph referred to as the `unused credit year'), such
excess shall be allowed as a credit carryback for each of the
3 taxable years beginning after September 30, 2002, which
precede the unused credit year and a credit carryforward for
each of the 20 taxable years which succeed the unused credit
year.
``(B) Rules.--Rules similar to the rules of section 39
shall apply with respect to the credit carryback and credit
carryforward under subparagraph (A).
``(12) Interaction with air quality and motor vehicle
safety standards.--Unless otherwise provided in this section,
a motor vehicle shall not be considered eligible for a credit
under this section unless such vehicle is in compliance
with--
``(A) the applicable provisions of the Clean Air Act for
the applicable make and model year of the vehicle (or
applicable air quality provisions of State law in the case of
a State which has adopted such provision under a waiver under
section 209(b) of the Clean Air Act), and
``(B) the motor vehicle safety provisions of sections 30101
through 30169 of title 49, United States Code.
``(g) Regulations.--
``(1) In general.--Except as provided in paragraph (2), the
Secretary shall promulgate such regulations as necessary to
carry out the provisions of this section.
``(2) Coordination in prescription of certain
regulations.--The Secretary of the Treasury, in coordination
with the Secretary of Transportation and the Administrator of
the Environmental Protection Agency, shall prescribe such
regulations as necessary to determine whether a motor vehicle
meets the requirements to be eligible for a credit under this
section.
``(h) Termination.--This section shall not apply to any
property purchased after--
``(1) in the case of a new qualified fuel cell motor
vehicle (as described in subsection (b)), December 31, 2011,
and
``(2) in the case of any other property, December 31,
2006.''.
(b) Conforming Amendments.--
(1) Section 1016(a) is amended by striking ``and'' at the
end of paragraph (27), by striking the period at the end of
paragraph (28) and inserting ``, and'', and by adding at the
end the following new paragraph:
``(29) to the extent provided in section 30B(f)(5).''.
(2) Section 55(c)(2) is amended by inserting ``30B(e),''
after ``30(b)(3)''.
(3) Section 6501(m) is amended by inserting ``30B(f)(10),''
after ``30(d)(4),''.
(4) The table of sections for subpart B of part IV of
subchapter A of chapter 1 is amended by inserting after the
item relating to section 30A the following new item:

``Sec. 30B. Alternative motor vehicle credit.''.

(e) Effective Date.--The amendments made by this section
shall apply to property placed in service after September 30,
2002, in taxable years ending after such date.

SEC. 2002. MODIFICATION OF CREDIT FOR QUALIFIED ELECTRIC
VEHICLES.

(a) Amount of Credit.--
(1) In general.--Section 30(a) (relating to allowance of
credit) is amended by striking ``10 percent of''.
(2) Limitation of credit according to type of vehicle.--
Section 30(b) (relating to limitations) is amended--
(A) by striking paragraphs (1) and (2) and inserting the
following new paragraph:
``(1) Limitation according to type of vehicle.--The amount
of the credit allowed under subsection (a) for any vehicle
shall not exceed the greatest of the following amounts
applicable to such vehicle:
``(A) In the case of a vehicle which conforms to the Motor
Vehicle Safety Standard 500 prescribed by the Secretary of
Transportation, as in effect on the date of the enactment of
the Energy Tax Incentives Act of 2003, the lesser of--
``(i) 10 percent of the manufacturer's suggested retail
price of the vehicle, or
``(ii) $1,500.
``(B) In the case of a vehicle not described in
subparagraph (A) with a gross vehicle weight rating not
exceeding 8,500 pounds--
``(i) $3,500, or
``(ii) $6,000, if such vehicle is--

``(I) capable of a driving range of at least 100 miles on a
single charge of the vehicle's rechargeable batteries as
measured pursuant to the urban dynamometer schedules under
appendix I to part 86 of title 40, Code of Federal
Regulations, or
``(II) capable of a payload capacity of at least 1,000
pounds.

``(C) In the case of a vehicle with a gross vehicle weight
rating exceeding 8,500 but not exceeding 14,000 pounds,
$10,000.
``(D) In the case of a vehicle with a gross vehicle weight
rating exceeding 14,000 but not exceeding 26,000 pounds,
$20,000.
``(E) In the case of a vehicle with a gross vehicle weight
rating exceeding 26,000 pounds, $40,000.'', and
(B) by redesignating paragraph (3) as paragraph (2).
(3) Conforming amendments.--
(A) Section 53(d)(1)(B)(iii) is amended by striking
``section 30(b)(3)(B)'' and inserting ``section
30(b)(2)(B)''.
(3) Section 55(c)(2), as amended by this Act, is amended by
striking ``30(b)(3)'' and inserting ``30(b)(2)''.
(b) Qualified Battery Electric Vehicle.--
(1) In general.--Section 30(c)(1)(A) (defining qualified
electric vehicle) is amended to read as follows:
``(A) which is--
``(i) operated solely by use of a battery or battery pack,
or
``(ii) powered primarily through the use of an electric
battery or battery pack using a flywheel or capacitor which
stores energy produced by an electric motor through
regenerative braking to assist in vehicle operation,''.
(2) Leased vehicles.--Section 30(c)(1)(C) is amended by
inserting ``or lease'' after ``use''.
(3) Conforming amendments.--
(A) Subsections (a), (b)(2), and (c) of section 30 are each
amended by inserting ``battery'' after ``qualified'' each
place it appears.
(B) The heading of subsection (c) of section 30 is amended
by inserting ``Battery'' after ``Qualified''.
(C) The heading of section 30 is amended by inserting
``BATTERY'' after ``QUALIFIED''.
(D) The item relating to section 30 in the table of
sections for subpart B of part IV of subchapter A of chapter
1 is amended by inserting ``battery'' after ``qualified''.
(E) Section 179A(c)(3) is amended by inserting ``battery''
before ``electric''.
(F) The heading of paragraph (3) of section 179A(c) is
amended by inserting ``battery'' before ``electric''.
(c) Additional Special Rules.--Section 30(d) (relating to
special rules) is amended by adding at the end the following
new paragraphs:
``(5) No double benefit.--The amount of any deduction or
other credit allowable under this chapter for any cost taken
into account in computing the amount of the credit determined
under subsection (a) shall be reduced by the amount of such
credit attributable to such cost.
``(6) Property used by tax-exempt entities.--In the case of
a credit amount which is allowable with respect to a vehicle
which is acquired by an entity exempt from tax under this
chapter, the person which sells or leases such vehicle to the
entity shall be treated as the taxpayer with respect to the
vehicle for purposes of this section and the credit shall be
allowed to such person, but only if the person clearly
discloses to the entity at the time of any sale or lease the
specific amount of any credit otherwise allowable to the
entity under this section.
``(7) Carryback and carryforward allowed.--
``(A) In general.--If the credit amount allowable under
subsection (a) for a taxable year exceeds the amount of the
limitation under subsection (b)(2) for such taxable year (in
this paragraph referred to as the `unused credit year'), such
excess shall be allowed as a credit carryback for each of the
3 taxable years beginning after September 30, 2002, which
precede the unused credit year and a credit carryforward for
each of the 20 taxable years which succeed the unused credit
year.
``(B) Rules.--Rules similar to the rules of section 39
shall apply with respect to the credit carryback and credit
carryforward under subparagraph (A).''.
(d) Effective Date.--The amendments made by this section
shall apply to property placed in service after September 30,
2002, in taxable years ending after such date.

[[Page S10815]]

SEC. 2003. CREDIT FOR INSTALLATION OF ALTERNATIVE FUELING
STATIONS.

(a) In General.--Subpart B of part IV of subchapter A of
chapter 1 (relating to foreign tax credit, etc.), as amended
by this Act, is amended by adding at the end the following
new section:

``SEC. 30C. CLEAN-FUEL VEHICLE REFUELING PROPERTY CREDIT.

``(a) Credit Allowed.--There shall be allowed as a credit
against the tax imposed by this chapter for the taxable year
an amount equal to 50 percent of the amount paid or incurred
by the taxpayer during the taxable year for the installation
of qualified clean-fuel vehicle refueling property.
``(b) Limitation.--The credit allowed under subsection
(a)--
``(1) with respect to any retail clean-fuel vehicle
refueling property, shall not exceed $30,000, and
``(2) with respect to any residential clean-fuel vehicle
refueling property, shall not exceed $1,000.
``(c) Year Credit Allowed.--The credit allowed under
subsection (a) shall be allowed in the taxable year in which
the qualified clean-fuel vehicle refueling property is placed
in service by the taxpayer.
``(d) Definitions.--For purposes of this section--
``(1) Qualified clean-fuel vehicle refueling property.--The
term `qualified clean-fuel vehicle refueling property' has
the same meaning given such term by section 179A(d).
``(2) Residential clean-fuel vehicle refueling property.--
The term `residential clean-fuel vehicle refueling property'
means qualified clean-fuel vehicle refueling property which
is installed on property which is used as the principal
residence (within the meaning of section 121) of the
taxpayer.
``(3) Retail clean-fuel vehicle refueling property.--The
term `retail clean-fuel vehicle refueling property' means
qualified clean-fuel vehicle refueling property which is
installed on property (other than property described in
paragraph (2)) used in a trade or business of the taxpayer.
``(e) Application With Other Credits.--The credit allowed
under subsection (a) for any taxable year shall not exceed
the excess (if any) of--
``(1) the regular tax for the taxable year reduced by the
sum of the credits allowable under subpart A and sections 27,
29, 30, and 30B, over
``(2) the tentative minimum tax for the taxable year.
``(f) Basis Reduction.--For purposes of this title, the
basis of any property shall be reduced by the portion of the
cost of such property taken into account under subsection
(a).
``(g) No Double Benefit.--No deduction shall be allowed
under section 179A with respect to any property with respect
to which a credit is allowed under subsection (a).
``(h) Refueling Property Installed for Tax-Exempt
Entities.--In the case of qualified clean-fuel vehicle
refueling property installed on property owned or used by an
entity exempt from tax under this chapter, the person which
installs such refueling property for the entity shall be
treated as the taxpayer with respect to the refueling
property for purposes of this section (and such refueling
property shall be treated as retail clean-fuel vehicle
refueling property) and the credit shall be allowed to such
person, but only if the person clearly discloses to the
entity in any installation contract the specific amount of
the credit allowable under this section.
``(i) Carryforward Allowed.--
``(1) In general.--If the credit amount allowable under
subsection (a) for a taxable year exceeds the amount of the
limitation under subsection (e) for such taxable year
(referred to as the `unused credit year' in this subsection),
such excess shall be allowed as a credit carryforward for
each of the 20 taxable years following the unused credit
year.
``(2) Rules.--Rules similar to the rules of section 39
shall apply with respect to the credit carryforward under
paragraph (1).
``(j) Special Rules.--Rules similar to the rules of
paragraphs (4) and (5) of section 179A(e) shall apply.
``(k) Regulations.--The Secretary shall prescribe such
regulations as necessary to carry out the provisions of this
section.
``(l) Termination.--This section shall not apply to any
property placed in service--
``(1) in the case of property relating to hydrogen, after
December 31, 2011, and
``(2) in the case of any other property, after December 31,
2006.''.
(b) Incentive for Production of Hydrogen at Qualified
Clean-Fuel Vehicle Refueling Property.--Section 179A(d)
(defining qualified clean-fuel vehicle refueling property) is
amended by adding at the end the following new flush
sentence:

``In the case of clean-burning fuel which is hydrogen
produced from another clean-burning fuel, paragraph (3)(A)
shall be applied by substituting `production, storage, or
dispensing' for `storage or dispensing' both places it
appears.''.
(c) Conforming Amendments.--(1) Section 1016(a), as amended
by this Act, is amended by striking ``and'' at the end of
paragraph (28), by striking the period at the end of
paragraph (29) and inserting ``, and'', and by adding at the
end the following new paragraph:
``(30) to the extent provided in section 30C(f).''.
(2) Section 55(c)(2), as amended by this Act, is amended by
inserting ``30C(e),'' after ``30B(e)''.
(3) The table of sections for subpart B of part IV of
subchapter A of chapter 1, as amended by this Act, is amended
by inserting after the item relating to section 30B the
following new item:

``Sec. 30C. Clean-fuel vehicle refueling property credit.''.

(c) Effective Date.--The amendments made by this section
shall apply to property placed in service after September 30,
2002, in taxable years ending after such date.

SEC. 2004. CREDIT FOR RETAIL SALE OF ALTERNATIVE FUELS AS
MOTOR VEHICLE FUEL.

(a) In General.--Subpart D of part IV of subchapter A of
chapter 1 (relating to business related credits) is amended
by inserting after section 40 the following new section:

``SEC. 40A. CREDIT FOR RETAIL SALE OF ALTERNATIVE FUELS AS
MOTOR VEHICLE FUEL.

``(a) General Rule.--For purposes of section 38, the
alternative fuel retail sales credit for any taxable year is
the applicable amount for each gasoline gallon equivalent of
alternative 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) Applicable amount.--The term `applicable amount'
means the amount determined in accordance with the following
table:

``In the case of any
taxable year                                           The applicable
ending in--                                               amount is--
2002 and 2003.................................................30 cents
2004..........................................................40 cents
2005 and 2006.................................................50 cents.

``(2) Alternative fuel.--The term `alternative fuel' means
compressed natural gas, liquefied natural gas, liquefied
petroleum gas, hydrogen, and any liquid at least 85 percent
of the volume of which consists of methanol or ethanol.
``(3) Gasoline gallon equivalent.--The term `gasoline
gallon equivalent' means, with respect to any alternative
fuel, the amount (determined by the Secretary) of such fuel
having a Btu content of 114,000.
``(4) Qualified motor vehicle.--The term `qualified motor
vehicle' means any motor vehicle (as defined in section
30(c)(2)) which meets any applicable Federal or State
emissions standards with respect to each fuel by which such
vehicle is designed to be propelled.
``(5) Sold at retail.--
``(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 alternative
fuel (including any use after importation) as a fuel to
propel any qualified alternative fuel motor vehicle (as
defined in section 30B(d)(4)) 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 a
vehicle by such person.
``(c) No Double Benefit.--The amount of any deduction or
other credit allowable under this chapter for any fuel taken
into account in computing the amount of the credit determined
under subsection (a) shall be reduced by the amount of such
credit attributable to such fuel.
``(d) Pass-Thru in the Case of Estates and Trusts.--Under
regulations prescribed by the Secretary, rules similar to the
rules of subsection (d) of section 52 shall apply.
``(e) Termination.--This section shall not apply to any
fuel sold at retail after December 31, 2006.''.
(b) Credit Treated as Business Credit.--Section 38(b)
(relating to current year business credit) is amended by
striking ``plus'' at the end of paragraph (14), by striking
the period at the end of paragraph (15) and inserting ``,
plus'', and by adding at the end the following new paragraph:
``(16) the alternative fuel retail sales credit determined
under section 40A(a).''.
(c) Transitional Rule.--Section 39(d) (relating to
transitional rules) is amended by adding at the end the
following new paragraph:
``(11) 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 alternative fuel
retail sales credit determined under section 40A(a) may be
carried back to a taxable year ending before January 1,
2002.''.
(d) Clerical Amendment.--The table of sections for subpart
D of part IV of subchapter A of chapter 1 is amended by
inserting after the item relating to section 40 the following
new item:

``Sec. 40A. Credit for retail sale of alternative fuels as motor
vehicle fuel.''.

(e) Effective Date.--The amendments made by this section
shall apply to fuel sold at retail after September 30, 2002,
in taxable years ending after such date.

SEC. 2005. SMALL ETHANOL PRODUCER CREDIT.

(a) Allocation of Alcohol Fuels Credit to Patrons of a
Cooperative.--Section 40(g) (relating to alcohol used as
fuel) is amended by adding at the end the following new
paragraph:
``(6) Allocation of small ethanol producer credit to
patrons of cooperative.--
``(A) Election to allocate.--
``(i) 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, 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.
``(ii) Form and effect of election.--An election under
clause (i) for any taxable year shall be made on a timely
filed return for such year. Such election, once made, shall
be irrevocable for such taxable year.
``(B) Treatment of organizations and patrons.--The amount
of the credit apportioned to patrons under subparagraph (A)--
``(i) shall not be included in the amount determined under
subsection (a) with respect to the organization for the
taxable year,

[[Page S10816]]

``(ii) shall be included in the amount determined under
subsection (a) for the taxable year of each patron for which
the patronage dividends for the taxable year described in
subparagraph (A) are included in gross income, and
``(iii) shall be included in gross income of such patrons
for the taxable year in the manner and to the extent provided
in section 87.
``(C) Special rules for decrease in credits 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
return of the cooperative organization for such year, an
amount equal to the excess of--
``(i) such reduction, over
``(ii) the amount not apportioned to such patrons under
subparagraph (A) for the taxable year,

shall be treated as an increase in tax imposed by this
chapter on the organization. Such increase shall not be
treated as tax imposed by this chapter for purposes of
determining the amount of any credit under this chapter or
for purposes of section 55.''.
(b) Improvements to Small Ethanol Producer Credit.--
(1) Definition of small ethanol producer.--Section 40(g)
(relating to definitions and special rules for eligible small
ethanol producer credit) is amended by striking
``30,000,000'' each place it appears and inserting
``60,000,000''.
(2) Small ethanol producer credit not a passive activity
credit.--Clause (i) of section 469(d)(2)(A) is amended by
striking ``subpart D'' and inserting ``subpart D, other than
section 40(a)(3),''.
(3) Allowing credit against entire regular tax and minimum
tax.--
(A) In general.--Subsection (c) of section 38 (relating to
limitation based on amount of tax), as amended by section
301(b) of the Job Creation and Worker Assistance Act of 2002,
is amended by redesignating paragraph (4) as paragraph (5)
and by inserting after paragraph (3) the following new
paragraph:
``(4) Special rules for small ethanol producer credit.--
``(A) In general.--In the case of the small ethanol
producer 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) the amounts in subparagraphs (A) and (B) thereof
shall be treated as being zero, 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 small
ethanol producer credit).

``(B) Small ethanol producer credit.--For purposes of this
subsection, the term `small ethanol producer credit' means
the credit allowable under subsection (a) by reason of
section 40(a)(3).''.
(B) Conforming amendments.--Subclause (II) of section
38(c)(2)(A)(ii), as amended by section 301(b)(2) of the Job
Creation and Worker Assistance Act of 2002, and subclause
(II) of section 38(c)(3)(A)(ii), as added by section
301(b)(1) of such Act, are each amended by inserting ``or the
small ethanol producer credit'' after ``employee credit''.
(4) Small ethanol producer credit not added back to income
under section 87.--Section 87 (relating to income inclusion
of alcohol fuel credit) is amended to read as follows:

``SEC. 87. ALCOHOL FUEL CREDIT.

``Gross income includes an amount equal to the sum of--
``(1) the amount of the alcohol mixture credit determined
with respect to the taxpayer for the taxable year under
section 40(a)(1), and
``(2) the alcohol credit determined with respect to the
taxpayer for the taxable year under section 40(a)(2).''.
(c) Conforming Amendment.--Section 1388 (relating to
definitions and special rules for cooperative organizations)
is amended by adding at the end the following new subsection:
``(k) Cross Reference.--For provisions relating to the
apportionment of the alcohol fuels credit between cooperative
organizations and their patrons, see section 40(g)(6).''.
(d) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after the date of the
enactment of this Act.

SEC. 2006. ALL ALCOHOL FUELS TAXES TRANSFERRED TO HIGHWAY
TRUST FUND.

(a) In General.--Section 9503(b)(4) (relating to certain
taxes not transferred to Highway Trust Fund) is amended--
(1) by adding ``or'' at the end of subparagraph (C),
(2) by striking the comma at the end of subparagraph
(D)(iii) and inserting a period, and
(3) by striking subparagraphs (E) and (F).
(b) Effective Date.--The amendments made by this section
shall apply to taxes imposed after September 30, 2003.

SEC. 2007. INCREASED FLEXIBILITY IN ALCOHOL FUELS TAX CREDIT.

(a) Alcohol Fuels Credit May Be Transferred.--Section 40
(relating to alcohol used as fuel) is amended by adding at
the end the following new subsection:
``(i) Credit May Be Transferred.--
``(1) In general.--A taxpayer may transfer any credit
allowable under paragraph (1) or (2) of subsection (a) with
respect to alcohol used in the production of ethyl tertiary
butyl ether through an assignment to a qualified assignee.
Such transfer may be revoked only with the consent of the
Secretary.
``(2) Qualified assignee.--For purposes of this subsection,
the term `qualified assignee' means any person who--
``(A) is liable for taxes imposed under section 4081,
``(B) is required to register under section 4101, and
``(C) obtains a certificate from the taxpayer described in
paragraph (1) which identifies the amount of alcohol used in
such production.
``(3) Regulations.--The Secretary shall prescribe such
regulations as necessary to insure that any credit described
in paragraph (1) is claimed once and not reassigned by a
qualified assignee.''.
(b) Alcohol Fuels Credit May Be Taken Against Motor Fuels
Tax Liability.--
(1) In general.--Subpart C of part III of subchapter A of
chapter 32 (relating to special provisions applicable to
petroleum products) is amended by adding at the end the
following new section:

``SEC. 4104. CREDIT AGAINST MOTOR FUELS TAXES.

``(a) Election To Use Credit Against Motor Fuels Taxes.--
There is hereby allowed as a credit against the taxes imposed
by section 4081, any credit allowed under paragraph (1) or
(2) of section 40(a) with respect to alcohol used in the
production of ethyl tertiary butyl ether to the extent--
``(1) such credit is not claimed by the taxpayer or the
qualified assignee under section 40(i) as a credit under
section 40, and
``(2) the taxpayer or qualified assignee elects to claim
such credit under this section.
``(b) Election Irrevocable.--Any election under subsection
(a) shall be irrevocable.
``(c) Required Statement.--Any return claiming a credit
pursuant to an election under this section shall be
accompanied by a statement that the credit was not, and will
not, be claimed on an income tax return.
``(d) Regulations.--The Secretary shall prescribe such
regulations as necessary to avoid the claiming of double
benefits and to prescribe the taxable periods with respect to
which the credit may be claimed.''.
(2) Conforming amendment.--Section 40(c) is amended by
striking ``or section 4091(c)'' and inserting ``section
4091(c), or section 4104''.
(3) Clerical amendment.--The table of sections for subpart
C of part III of subchapter A of chapter 32 is amended by
adding at the end the following new item:

``Sec. 4104. Credit against motor fuels taxes.''.

(c) Effective Date.--The amendments made by this section
shall take effect on and after the date of the enactment of
this Act.

SEC. 2008. INCENTIVES FOR BIODIESEL.

(a) Credit for Biodiesel Used as a Fuel.--
(1) In general.--Subpart D of part IV of subchapter A of
chapter 1 (relating to business related credits), as amended
by this Act, is amended by inserting after section 40A the
following new section:

``SEC. 40B. BIODIESEL USED AS FUEL.

``(a) General Rule.--For purposes of section 38, the
biodiesel fuels credit determined under this section for the
taxable year is an amount equal to the biodiesel mixture
credit.
``(b) Definition of Biodiesel Mixture Credit.--For purposes
of this section--
``(1) Biodiesel mixture credit.--
``(A) In general.--The biodiesel mixture credit of any
taxpayer for any taxable year is the sum of the products of
the biodiesel mixture rate for each qualified biodiesel
mixture and the number of gallons of such mixture of the
taxpayer for the taxable year.
``(B) Biodiesel mixture rate.--For purposes of subparagraph
(A), the biodiesel mixture rate for each qualified biodiesel
mixture shall be--
``(i) in the case of a mixture with only biodiesel V, 1
cent for each whole percentage point (not exceeding 20
percentage points) of biodiesel V in such mixture, and
``(ii) in the case of a mixture with biodiesel NV, or a
combination of biodiesel V and biodiesel NV, 0.5 cent for
each whole percentage point (not exceeding 20 percentage
points) of such biodiesel in such mixture.
``(2) Qualified biodiesel mixture.--
``(A) In general.--The term `qualified biodiesel mixture'
means a mixture of diesel and biodiesel V or biodiesel NV
which--
``(i) is sold by the taxpayer producing such mixture to any
person for use as a fuel, or
``(ii) is used as a fuel by the taxpayer producing such
mixture.
``(B) Sale or use must be in trade or business, etc.--
``(i) In general.--Biodiesel V or biodiesel NV used in the
production of a qualified biodiesel mixture shall be taken
into account--

``(I) only if the sale or use described in subparagraph (A)
is in a trade or business of the taxpayer, and
``(II) for the taxable year in which such sale or use
occurs.

``(ii) Certification for biodiesel v.--Biodiesel V used in
the production of a qualified biodiesel mixture shall be
taken into account only if the taxpayer described in
subparagraph (A) obtains a certification from the producer of
the biodiesel V which identifies the product produced.
``(C) Casual off-farm production not eligible.--No credit
shall be allowed under this section with respect to any
casual off-farm production of a qualified biodiesel mixture.
``(c) Coordination With Exemption From Excise Tax.--The
amount of the credit determined under this section with
respect to any biodiesel V shall, under regulations
prescribed by the Secretary, be properly reduced to take into
account any benefit provided with respect to such biodiesel V
solely by reason of the application of section 4041(n) or
section 4081(f).
``(d) Definitions and Special Rules.--For purposes of this
section--
``(1) Biodiesel v defined.--The term `biodiesel V' means
the monoalkyl esters of long chain fatty acids derived solely
from virgin vegetable oils for use in compressional-ignition
(diesel) engines. Such term shall include esters derived from
vegetable oils from corn, soybeans,

[[Page S10817]]

sunflower seeds, cottonseeds, canola, crambe, rapeseeds,
safflowers, flaxseeds, rice bran, and mustard seeds.
``(2) Biodiesel nv defined.--The term `biodiesel nv' means
the monoalkyl esters of long chain fatty acids derived from
nonvirgin vegetable oils or animal fats for use in
compressional-ignition (diesel) engines.
``(3) Registration requirements.--The terms `biodiesel V'
and `biodiesel NV' shall only include a biodiesel which
meets--
``(i) the registration requirements for fuels and fuel
additives established by the Environmental Protection Agency
under section 211 of the Clean Air Act (42 U.S.C. 7545), and
``(ii) the requirements of the American Society of Testing
and Materials D6751.
``(2) Biodiesel mixture not used as a fuel, etc.--
``(A) Imposition of tax.--If--
``(i) any credit was determined under this section with
respect to biodiesel V or biodiesel NV used in the production
of any qualified biodiesel mixture, and
``(ii) any person--

``(I) separates such biodiesel from the mixture, or
``(II) without separation, uses the mixture other than as a
fuel,

then there is hereby imposed on such person a tax equal to
the product of the biodiesel mixture rate applicable under
subsection (b)(1)(B) and the number of gallons of the
mixture.
``(B) Applicable laws.--All provisions of law, including
penalties, shall, insofar as applicable and not inconsistent
with this section, apply in respect of any tax imposed under
subparagraph (A) as if such tax were imposed by section 4081
and not by this chapter.
``(3) Pass-thru in the case of estates and trusts.--Under
regulations prescribed by the Secretary, rules similar to the
rules of subsection (d) of section 52 shall apply.
``(e) Election To Have Biodiesel Fuels Credit Not Apply.--
``(1) In general.--A taxpayer may elect to have this
section not apply for any taxable year.
``(2) Time for making election.--An election under
paragraph (1) for any taxable year may be made (or revoked)
at any time before the expiration of the 3-year period
beginning on the last date prescribed by law for filing the
return for such taxable year (determined without regard to
extensions).
``(3) Manner of making election.--An election under
paragraph (1) (or revocation thereof) shall be made in such
manner as the Secretary may by regulations prescribe.''.
``(f) Termination.--This section shall not apply to any
fuel sold after December 31, 2005.''.
(2) Credit treated as part of general business credit.--
Section 38(b), as amended by this Act, is amended by striking
``plus'' at the end of paragraph (15), by striking the period
at the end of paragraph (16) and inserting ``, plus'', and by
adding at the end the following new paragraph:
``(17) the biodiesel fuels credit determined under section
40B(a).''.
(3) Conforming amendments.--
(A) Section 39(d), as amended by this Act, is amended by
adding at the end the following new paragraph:
``(12) No carryback of biodiesel fuels credit before
january 1, 2003.--No portion of the unused business credit
for any taxable year which is attributable to the biodiesel
fuels credit determined under section 40B may be carried back
to a taxable year beginning before January 1, 2003.''.
(B) Section 196(c) is amended by striking ``and'' at the
end of paragraph (9), by striking the period at the end of
paragraph (10), and by adding at the end the following new
paragraph:
``(11) the biodiesel fuels credit determined under section
40B(a).''.
(C) Section 6501(m), as amended by this Act, is amended by
inserting ``40B(e),'' after ``40(f),''.
(D) The table of sections for subpart D of part IV of
subchapter A of chapter 1, as amended by this Act, is amended
by adding after the item relating to section 40A the
following new item:

``Sec. 40B. Biodiesel used as fuel.''.

(4) Effective date.--The amendments made by this subsection
shall apply to taxable years beginning after December 31,
2002.
(b) Reduction of Motor Fuel Excise Taxes on Biodiesel V
Mixtures.--
(1) In general.--Section 4081 (relating to manufacturers
tax on petroleum products) is amended by adding at the end
the following new subsection:
``(f) Biodiesel V Mixtures.--Under regulations prescribed
by the Secretary--
``(1) In general.--In the case of the removal or entry of a
qualified biodiesel mixture with biodiesel V, the rate of tax
under subsection (a) shall be the otherwise applicable rate
reduced by the biodiesel mixture rate (if any) applicable to
the mixture.
``(2) Tax prior to mixing.--
``(A) In general.--In the case of the removal or entry of
diesel fuel for use in producing at the time of such removal
or entry a qualified biodiesel mixture with biodiesel V, the
rate of tax under subsection (a) shall be the rate determined
under subparagraph (B).
``(B) Determination of rate.--For purposes of subparagraph
(A), the rate determined under this subparagraph is the rate
determined under paragraph (1), divided by a percentage equal
to 100 percent minus the percentage of biodiesel V which will
be in the mixture.
``(3) Definitions.--For purposes of this subsection, any
term used in this subsection which is also used in section
40B shall have the meaning given such term by section 40B.
``(4) Certain rules to apply.--Rules similar to the rules
of paragraphs (6) and (7) of subsection (c) shall apply for
purposes of this subsection.''.
(2) Conforming amendments.--
(A) Section 4041 is amended by adding at the end the
following new subsection:
``(n) Biodiesel V Mixtures.--Under regulations prescribed
by the Secretary, in the case of the sale or use of a
qualified biodiesel mixture (as defined in section 40B(b)(2))
with biodiesel V, the rates under paragraphs (1) and (2) of
subsection (a) shall be the otherwise applicable rates,
reduced by any applicable biodiesel mixture rate (as defined
in section 40B(b)(1)(B)).''.
(B) Section 6427 is amended by redesignating subsection (p)
as subsection (q) and by inserting after subsection (o) the
following new subsection:
``(p) Biodiesel V Mixtures.--Except as provided in
subsection (k), if any diesel fuel on which tax was imposed
by section 4081 at a rate not determined under section
4081(f) is used by any person in producing a qualified
biodiesel mixture (as defined in section 40B(b)(2)) with
biodiesel V which is sold or used in such person's trade or
business, the Secretary shall pay (without interest) to such
person an amount equal to the per gallon applicable biodiesel
mixture rate (as defined in section 40B(b)(1)(B)) with
respect to such fuel.''.
(3) Effective date.--The amendments made by this subsection
shall apply to any fuel sold after December 31, 2002, and
before January 1, 2006.
(c) Highway Trust Fund Held Harmless.--There are hereby
transferred (from time to time) from the funds of the
Commodity Credit Corporation amounts determined by the
Secretary of the Treasury to be equivalent to the reductions
that would occur (but for this subsection) in the receipts of
the Highway Trust Fund by reason of the amendments made by
this section.

SEC. 2009. CREDIT FOR TAXPAYERS OWNING COMMERCIAL POWER
TAKEOFF VEHICLES.

(a) In General.--Subpart D of part IV of subchapter A of
chapter 1 (relating to business-related credits), as amended
by this Act, is amended by adding at the end the following
new section:

``SEC. 45N. COMMERCIAL POWER TAKEOFF VEHICLES CREDIT.

``(a) General Rule.--For purposes of section 38, the amount
of the commercial power takeoff vehicles credit determined
under this section for the taxable year is $250 for each
qualified commercial power takeoff vehicle owned by the
taxpayer as of the close of the calendar year in which or
with which the taxable year of the taxpayer ends.
``(b) Definitions.--For purposes of this section--
``(1) Qualified commercial power takeoff vehicle.--The term
`qualified commercial power takeoff vehicle' means any
highway vehicle described in paragraph (2) which is propelled
by any fuel subject to tax under section 4041 or 4081 if such
vehicle is used in a trade or business or for the production
of income (and is licensed and insured for such use).
``(2) Highway vehicle described.--A highway vehicle is
described in this paragraph if such vehicle is--
``(A) designed to engage in the daily collection of refuse
or recyclables from homes or businesses and is equipped with
a mechanism under which the vehicle's propulsion engine
provides the power to operate a load compactor, or
``(B) designed to deliver ready mixed concrete on a daily
basis and is equipped with a mechanism under which the
vehicle's propulsion engine provides the power to operate a
mixer drum to agitate and mix the product en route to the
delivery site.
``(c) Exception for Vehicles Used by Governments, Etc.--No
credit shall be allowed under this section for any vehicle
owned by any person at the close of a calendar year if such
vehicle is used at any time during such year by--
``(1) the United States or an agency or instrumentality
thereof, a State, a political subdivision of a State, or an
agency or instrumentality of one or more States or political
subdivisions, or
``(2) an organization exempt from tax under section 501(a).
``(d) Denial of Double Benefit.--The amount of any
deduction under this subtitle for any tax imposed by
subchapter B of chapter 31 or part III of subchapter A of
chapter 32 for any taxable year shall be reduced (but not
below zero) by the amount of the credit determined under this
subsection for such taxable year.
``(e) Termination.--This section shall not apply with
respect to any calendar year after 2004.''.
(b) Credit Made Part of General Business Credit.--
Subsection (b) of section 38 (relating to general business
credit), as amended by this Act, is amended by striking
``plus'' at the end of paragraph (22), by striking the period
at the end of paragraph (23) and inserting ``, plus'', and by
adding at the end the following new paragraph:
``(24) the commercial power takeoff vehicles credit under
section 45N(a).''.
(c) Clerical Amendment.--The table of sections for subpart
D of part IV of subchapter A of chapter 1, as amended by this
Act, is amended by adding at the end the following new item:

``Sec. 45N. Commercial power takeoff vehicles credit.''.

(d) Regulations.--Not later than January 1, 2005, the
Secretary of the Treasury, in consultation with the Secretary
of Energy, shall by regulation provide for the method of
determining the exemption from any excise tax imposed under
section 4041 or 4081 of the Internal Revenue Code of 1986 on
fuel used through a mechanism to power equipment attached to
a highway vehicle as described in section 45N(b)(2) of such
Code, as added by subsection (a).
(e) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after the date of the
enactment of this Act.

[[Page S10818]]

SEC. 2010. MODIFICATIONS TO THE INCENTIVES FOR ALTERNATIVE
VEHICLES AND FUELS.

(a) Modification to New Qualified Hybrid Motor Vehicle
Credit.--The table in section 30B(c)(2)(A) of the Internal
Revenue Code of 1986, as added by this Act, is amended by
striking ``5 percent'' and inserting ``4 percent''.
(b) Modifications to Extension of Deduction for Certain
Refueling Property.--
(1) In general.--Subsection (f) of section 179A of the
Internal Revenue Code of 1986 is amended to read as follows:
``(f) Termination.--This section shall not apply to any
property placed in service--
``(1) in the case of property relating to hydrogen, after
December 31, 2011, and
``(2) in the case of any other property, after December 31,
2007.''.
(2) Extension of phaseout.--Section 179A(b)(1)(B) of such
Code, as amended by section 606(a) of the Job Creation and
Worker Assistance Act of 2002, is amended--
(A) by striking ``calendar year 2004'' in clause (i) and
inserting ``calendar years 2004 and 2005 (calendar years 2004
through 2009 in the case of property relating to hydrogen)
'',
(B) by striking ``2005'' in clause (ii) and inserting
``2006 (calendar year 2010 in the case of property relating
to hydrogen)'', and
(C) by striking ``2006'' in clause (iii) and inserting
``2007 (calendar year 2011 in the case of property relating
to hydrogen)''.
(3) Effective date.--The amendments made by this subsection
shall apply to property placed in service after December 31,
2003, in taxable years ending after such date.
(c) Modification to Credit for Installation of Alternative
Fueling Stations.--Subsection (l) of section 30C of the
Internal Revenue Code of 1986, as added by this Act, is
amended to read as follows:
``(l) Termination.--This section shall not apply to any
property placed in service--
``(1) in the case of property relating to hydrogen, after
December 31, 2011, and
``(2) in the case of any other property, after December 31,
2007.''.
(d) Effective Date.--Except as provided in subsection
(b)(3), the amendments made by this section shall apply to
property placed in service after September 30, 2002, in
taxable years ending after such date.

TITLE XXI--CONSERVATION AND ENERGY EFFICIENCY PROVISIONS

SEC. 2101. CREDIT FOR CONSTRUCTION OF NEW ENERGY EFFICIENT
HOME.

(a) In General.--Subpart D of part IV of subchapter A of
chapter 1 (relating to business related credits), as amended
by this Act, is amended by adding at the end the following
new section:

``SEC. 45G. NEW ENERGY EFFICIENT HOME CREDIT.

``(a) In General.--For purposes of section 38, in the case
of an eligible contractor, the credit determined under this
section for the taxable year is an amount equal to the
aggregate adjusted bases of all energy efficient property
installed in a qualifying new home during construction of
such home.
``(b) Limitations.--
``(1) Maximum credit.--
``(A) In general.--The credit allowed by this section with
respect to a qualifying new home shall not exceed--
``(i) in the case of a 30-percent home, $1,250, and
``(ii) in the case of a 50-percent home, $2,000.
``(B) 30- or 50-percent home.--For purposes of subparagraph
(A)--
``(i) 30-percent home.--The term `30-percent home' means a
qualifying new home which is certified to have a projected
level of annual heating and cooling energy consumption,
measured in terms of average annual energy cost to the
homeowner, which is at least 30 percent less than the annual
level of heating and cooling energy consumption of a
reference qualifying new home constructed in accordance with
the standards of chapter 4 of the 2000 International Energy
Conservation Code, or a qualifying new home which is a
manufactured home which meets the applicable standards of the
Energy Star program managed jointly by the Environmental
Protection Agency and the Department of Energy.
``(ii) 50-percent home.--The term `50-percent home' means a
qualifying new home which is certified to have a projected
level of annual heating and cooling energy consumption,
measured in terms of average annual energy cost to the
homeowner, which is at least 50 percent less than such annual
level of heating and cooling energy consumption.
``(C) Prior credit amounts on same home taken into
account.--If a credit was allowed under subsection (a) with
respect to a qualifying new home in 1 or more prior taxable
years, the amount of the credit otherwise allowable for the
taxable year with respect to that home shall not exceed the
amount under clause (i) or (ii) of subparagraph (A) (as the
case may be), reduced by the sum of the credits allowed under
subsection (a) with respect to the home for all prior taxable
years.
``(2) Coordination with rehabilitation and energy
credits.--For purposes of this section--
``(A) the basis of any property referred to in subsection
(a) shall be reduced by that portion of the basis of any
property which is attributable to the rehabilitation credit
(as determined under section 47(a)) or to the energy
percentage of energy property (as determined under section
48(a)), and
``(B) expenditures taken into account under either section
47 or 48(a) shall not be taken into account under this
section.
``(c) Definitions.--For purposes of this section--
``(1) Eligible contractor.--The term `eligible contractor'
means the person who constructed the qualifying new home, or
in the case of a manufactured home which conforms to Federal
Manufactured Home Construction and Safety Standards (24
C.F.R. 3280), the manufactured home producer of such home.
``(2) Energy efficient property.--The term `energy
efficient property' means any energy efficient building
envelope component, and any energy efficient heating or
cooling equipment which can, individually or in combination
with other components, meet the requirements of this section.
``(3) Qualifying new home.--The term `qualifying new home'
means a dwelling--
``(A) located in the United States,
``(B) the construction of which is substantially completed
after the date of the enactment of this section, and
``(C) the first use of which after construction is as a
principal residence (within the meaning of section 121).
``(4) Construction.--The term `construction' includes
reconstruction and rehabilitation.
``(5) Building envelope component.--The term `building
envelope component' means--
``(A) any insulation material or system which is
specifically and primarily designed to reduce the heat loss
or gain of a qualifying new home when installed in or on such
home, and
``(B) exterior windows (including skylights) and doors.
``(6) Manufactured home included.--The term `qualifying new
home' includes a manufactured home conforming to Federal
Manufactured Home Construction and Safety Standards (24
C.F.R. 3280).
``(d) Certification.--
``(1) Method of certification.--
``(A) In general.--A certification described in subsection
(b)(1)(B) shall be determined either by a component-based
method or a performance-based method.
``(B) Component-based method.--A component-based method is
a method which uses the applicable technical energy
efficiency specifications or ratings (including product
labeling requirements) for the energy efficient building
envelope component or energy efficient heating or cooling
equipment. The Secretary shall, in consultation with the
Administrator of the Environmental Protection Agency, develop
prescriptive component-based packages that are equivalent in
energy performance to properties that qualify under
subparagraph (C).
``(C) Performance-based method.--
``(i) In general.--A performance-based method is a method
which calculates projected energy usage and cost reductions
in the qualifying new home in relation to a reference
qualifying new home--

``(I) heated by the same energy source and heating system
type, and
``(II) constructed in accordance with the standards of
chapter 4 of the 2000 International Energy Conservation Code.

``(ii) Computer software.--Computer software shall be used
in support of a performance-based method certification under
clause (i). Such software shall meet procedures and methods
for calculating energy and cost savings in regulations
promulgated by the Secretary of Energy. Such regulations on
the specifications for software and verification protocols
shall be based on the 2001 California Residential Alternative
Calculation Method Approval Manual.
``(2) Provider.--A certification described in subsection
(b)(1)(B) shall be provided by--
``(A) in the case of a component-based method, a local
building regulatory authority, a utility, a manufactured home
production inspection primary inspection agency (IPIA), or a
home energy rating organization, or
``(B) in the case of a performance-based method, an
individual recognized by an organization designated by the
Secretary for such purposes.
``(3) Form.--
``(A) In general.--A certification described in subsection
(b)(1)(B) shall be made in writing in a manner that specifies
in readily verifiable fashion the energy efficient building
envelope components and energy efficient heating or cooling
equipment installed and their respective rated energy
efficiency performance, and in the case of a performance-
based method, accompanied by a written analysis documenting
the proper application of a permissible energy performance
calculation method to the specific circumstances of such
qualifying new home.
``(B) Form provided to buyer.--A form documenting the
energy efficient building envelope components and energy
efficient heating or cooling equipment installed and their
rated energy efficiency performance shall be provided to the
buyer of the qualifying new home. The form shall include
labeled R-value for insulation products, NFRC-labeled U-
factor and Solar Heat Gain Coefficient for windows,
skylights, and doors, labeled AFUE ratings for furnaces and
boilers, labeled HSPF ratings for electric heat pumps, and
labeled SEER ratings for air conditioners.
``(C) Ratings label affixed in dwelling.--A permanent label
documenting the ratings in subparagraph (B) shall be affixed
to the front of the electrical distribution panel of the
qualifying new home, or shall be otherwise permanently
displayed in a readily inspectable location in such home.
``(4) Regulations.--
``(A) In general.--In prescribing regulations under this
subsection for performance-based certification methods, the
Secretary, 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, shall prescribe procedures for
calculating annual energy usage and cost reductions for
heating and cooling and for the reporting of the results.
Such regulations shall--
``(i) provide that any calculation procedures be fuel
neutral such that the same energy efficiency measures allow a
qualifying new home to

[[Page S10819]]

be eligible for the credit under this section regardless of
whether such home uses a gas or oil furnace or boiler or an
electric heat pump, and
``(ii) require that any computer software allow for the
printing of the Federal tax forms necessary for the credit
under this section and for the printing of forms for
disclosure to the homebuyer.
``(B) Providers.--For purposes of paragraph (2)(B), the
Secretary shall establish requirements for the designation of
individuals based on the requirements for energy consultants
and home energy raters specified by the Mortgage Industry
National Accreditation Procedures for Home Energy Rating
Systems.
``(e) Termination.--Subsection (a) shall apply to
qualifying new homes purchased during the period beginning on
the date of the enactment of this section and ending on
December 31, 2007.''.
(b) Credit Made Part of General Business Credit.--
Subsection (b) of section 38 (relating to current year
business credit), as amended by this Act, is amended by
striking ``plus'' at the end of paragraph (16), by striking
the period at the end of paragraph (17) and inserting ``,
plus'', and by adding at the end the following new paragraph:
``(18) the new energy efficient home credit determined
under section 45G(a).''.
(c) Denial of Double Benefit.--Section 280C (relating to
certain expenses for which credits are allowable) is amended
by adding at the end the following new subsection:
``(d) New Energy Efficient Home Expenses.--No deduction
shall be allowed for that portion of expenses for a
qualifying new home 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 45G(a).''.
(d) Limitation on Carryback.--Subsection (d) of section 39,
as amended by this Act, is amended by adding at the end the
following new paragraph:
``(13) No carryback of new energy efficient home credit
before effective date.--No portion of the unused business
credit for any taxable year which is attributable to the
credit determined under section 45G may be carried back to
any taxable year ending on or before the date of the
enactment of section 45G.''.
(e) Deduction for Certain Unused Business Credits.--
Subsection (c) of section 196, as amended by this Act, is
amended by striking ``and'' at the end of paragraph (10), by
striking the period at the end of paragraph (11) and
inserting ``, and'', and by adding after paragraph (11) the
following new paragraph:
``(12) the new energy efficient home credit determined
under section 45G(a).''.
(f) Clerical Amendment.--The table of sections for subpart
D of part IV of subchapter A of chapter 1, as amended by this
Act, is amended by adding at the end the following new item:

``Sec. 45G. New energy efficient home credit.''.

(g) Effective Date.--The amendments made by this section
shall apply to taxable years ending after the date of the
enactment of this Act.

SEC. 2102. CREDIT FOR ENERGY EFFICIENT APPLIANCES.

(a) In General.--Subpart D of part IV of subchapter A of
chapter 1 (relating to business-related credits), as amended
by this Act, is amended by adding at the end the following
new section:

``SEC. 45H. ENERGY EFFICIENT APPLIANCE CREDIT.

``(a) General Rule.--For purposes of section 38, the energy
efficient appliance credit determined under this section for
the taxable year is an amount equal to the applicable amount
determined under subsection (b) with respect to the eligible
production of qualified energy efficient appliances produced
by the taxpayer during the calendar year ending with or
within the taxable year.
``(b) Applicable Amount; Eligible Production.--For purposes
of subsection (a)--
``(1) Applicable amount.--The applicable amount is--
``(A) $50, in the case of--
``(i) a clothes washer which is manufactured with at least
a 1.26 MEF, or
``(ii) a refrigerator which consumes at least 10 percent
less kWh per year than the energy conservation standards for
refrigerators promulgated by the Department of Energy
effective July 1, 2001, and
``(B) $100, in the case of--
``(i) a clothes washer which is manufactured with at least
a 1.42 MEF (at least 1.5 MEF for washers produced after
2004), or
``(ii) a refrigerator which consumes at least 15 percent
less kWh per year than such energy conservation standards.
``(2) Eligible production.--
``(A) In general.--The eligible production of each category
of qualified energy efficient appliances is the excess of--
``(i) the number of appliances in such category which are
produced by the taxpayer during such calendar year, over
``(ii) the average number of appliances in such category
which were produced by the taxpayer during calendar years
1999, 2000, and 2001.
``(B) Categories.--For purposes of subparagraph (A), the
categories are--
``(i) clothes washers described in paragraph (1)(A)(i),
``(ii) clothes washers described in paragraph (1)(B)(i),
``(iii) refrigerators described in paragraph (1)(A)(ii),
and
``(iv) refrigerators described in paragraph (1)(B)(ii).
``(c) Limitation on Maximum Credit.--
``(1) In general.--The maximum amount of credit allowed
under subsection (a) with respect to a taxpayer for all
taxable years shall be--
``(A) $30,000,000 with respect to the credit determined
under subsection (b)(1)(A), and
``(B) $30,000,000 with respect to the credit determined
under subsection (b)(1)(B).
``(2) Limitation based on gross receipts.--The credit
allowed under subsection (a) with respect to a taxpayer for
the taxable year shall not exceed an amount equal to 2
percent of the average annual gross receipts of the taxpayer
for the 3 taxable years preceding the taxable year in which
the credit is determined.
``(3) Gross receipts.--For purposes of this subsection, the
rules of paragraphs (2) and (3) of section 448(c) shall
apply.
``(d) Definitions.--For purposes of this section--
``(1) Qualified energy efficient appliance.--The term
`qualified energy efficient appliance' means--
``(A) a clothes washer described in subparagraph (A)(i) or
(B)(i) of subsection (b)(1), or
``(B) a refrigerator described in subparagraph (A)(ii) or
(B)(ii) of subsection (b)(1).
``(2) Clothes washer.--The term `clothes washer' means a
residential clothes washer, including a residential style
coin operated washer.
``(3) Refrigerator.--The term `refrigerator' means an
automatic defrost refrigerator-freezer which has an internal
volume of at least 16.5 cubic feet.
``(4) MEF.--The term `MEF' means Modified Energy Factor (as
determined by the Secretary of Energy).
``(e) Special Rules.--
``(1) In general.--Rules similar to the rules of
subsections (c), (d), and (e) of section 52 shall apply for
purposes of this section.
``(2) Aggregation rules.--All persons treated as a single
employer under subsection (a) or (b) of section 52 or
subsection (m) or (o) of section 414 shall be treated as 1
person for purposes of subsection (a).
``(f) Verification.--The taxpayer shall submit such
information or certification as the Secretary, in
consultation with the Secretary of Energy, determines
necessary to claim the credit amount under subsection (a).
``(g) Termination.--This section shall not apply--
``(1) with respect to refrigerators described in subsection
(b)(1)(A)(ii) produced after December 31, 2004, and
``(2) with respect to all other qualified energy efficient
appliances produced after December 31, 2006.''.
(b) Limitation on Carryback.--Section 39(d) (relating to
transition rules), as amended by this Act, is amended by
adding at the end the following new paragraph:
``(14) No carryback of energy efficient appliance credit
before effective date.--No portion of the unused business
credit for any taxable year which is attributable to the
energy efficient appliance credit determined under section
45H may be carried to a taxable year ending before January 1,
2003.''.
(c) Conforming Amendment.--Section 38(b) (relating to
general business credit), as amended by this Act, is amended
by striking ``plus'' at the end of paragraph (17), by
striking the period at the end of paragraph (18) and
inserting ``, plus'', and by adding at the end the following
new paragraph:
``(19) the energy efficient appliance credit determined
under section 45H(a).''.
(d) Clerical Amendment.--The table of sections for subpart
D of part IV of subchapter A of chapter 1, as amended by this
Act, is amended by adding at the end the following new item:

``Sec. 45H. Energy efficient appliance credit.''.

(e) Effective Date.--The amendments made by this section
shall apply to appliances produced after December 31, 2002,
in taxable years ending after such date.

SEC. 2103. CREDIT FOR RESIDENTIAL ENERGY EFFICIENT PROPERTY.

(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 25B the following new
section:

``SEC. 25C. RESIDENTIAL ENERGY EFFICIENT PROPERTY.

``(a) Allowance of Credit.--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--
``(1) 15 percent of the qualified photovoltaic property
expenditures made by the taxpayer during such year,
``(2) 15 percent of the qualified solar water heating
property expenditures made by the taxpayer during such year,
``(3) 30 percent of the qualified fuel cell property
expenditures made by the taxpayer during such year,
``(4) 30 percent of the qualified wind energy property
expenditures made by the taxpayer during such year, and
``(5) the sum of the qualified Tier 2 energy efficient
building property expenditures made by the taxpayer during
such year.
``(b) Limitations.--
``(1) Maximum credit.--The credit allowed under subsection
(a) shall not exceed--
``(A) $2,000 for property described in subsection (d)(1),
``(B) $2,000 for property described in subsection (d)(2),
``(C) $1,000 for each kilowatt of capacity of property
described in subsection (d)(4),
``(D) $2,000 for property described in subsection (d)(5),
and
``(E) for property described in subsection (d)(6)--
``(i) $75 for each electric heat pump water heater,
``(ii) $250 for each electric heat pump,
``(iii) $250 for each advanced natural gas furnace,
``(iv) $250 for each central air conditioner,
``(v) $75 for each natural gas water heater, and

[[Page S10820]]

``(vi) $250 for each geothermal heat pump.
``(2) 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,
``(B) in the case of a photovoltaic property, a fuel cell
property, or a wind energy property, such property meets
appropriate fire and electric code requirements, and
``(C) in the case of property described in subsection
(d)(6), such property meets the performance and quality
standards, and the certification requirements (if any),
which--
``(i) have been prescribed by the Secretary by regulations
(after consultation with the Secretary of Energy or the
Administrator of the Environmental Protection Agency, as
appropriate),
``(ii) in the case of the energy efficiency ratio (EER)--

``(I) require measurements to be based on published data
which is tested by manufacturers at 95 degrees Fahrenheit,
and
``(II) do not require ratings to be based on certified data
of the Air Conditioning and Refrigeration Institute, and

``(iii) are in effect at the time of the acquisition of the
property.
``(c) Carryforward of Unused Credit.--If the credit
allowable under subsection (a) exceeds the limitation imposed
by section 26(a) for such taxable year reduced by the sum of
the credits allowable under this subpart (other than this
section and section 25D), such excess shall be carried to the
succeeding taxable year and added to the credit allowable
under subsection (a) for such succeeding taxable year.
``(d) Definitions.--For purposes of this section--
``(1) Qualified solar water heating property expenditure.--
The term `qualified solar water heating property expenditure'
means an expenditure for property to heat water for use in a
dwelling unit located in the United States and used as a
residence by the taxpayer if at least half of the energy used
by such property for such purpose is derived from the sun.
``(2) Qualified photovoltaic property expenditure.--The
term `qualified photovoltaic property expenditure' means an
expenditure for property that uses solar energy to generate
electricity for use in such a dwelling unit.
``(3) Solar panels.--No expenditure relating to a solar
panel or other property installed as a roof (or portion
thereof) shall fail to be treated as property described in
paragraph (1) or (2) solely because it constitutes a
structural component of the structure on which it is
installed.
``(4) Qualified fuel cell property expenditure.--The term
`qualified fuel cell property expenditure' means an
expenditure for qualified fuel cell property (as defined in
section 48(a)(4)) installed on or in connection with such a
dwelling unit.
``(5) Qualified wind energy property expenditure.--The term
`qualified wind energy property expenditure' means an
expenditure for property which uses wind energy to generate
electricity for use in such a dwelling unit.
``(6) Qualified tier 2 energy efficient building property
expenditure.--
``(A) In general.--The term `qualified Tier 2 energy
efficient building property expenditure' means an expenditure
for any Tier 2 energy efficient building property.
``(B) Tier 2 energy efficient building property.--The term
`Tier 2 energy efficient building property' means--
``(i) an electric heat pump water heater which yields an
energy factor of at least 1.7 in the standard Department of
Energy test procedure,
``(ii) an electric heat pump which has a heating seasonal
performance factor (HSPF) of at least 9, a seasonal energy
efficiency ratio (SEER) of at least 15, and an energy
efficiency ratio (EER) of at least 12.5,
``(iii) an advanced natural gas furnace which achieves at
least 95 percent annual fuel utilization efficiency (AFUE),
``(iv) a central air conditioner which has a seasonal
energy efficiency ratio (SEER) of at least 15 and an energy
efficiency ratio (EER) of at least 12.5,
``(v) a natural gas water heater which has an energy factor
of at least 0.80 in the standard Department of Energy test
procedure, and
``(vi) a geothermal heat pump which has an energy
efficiency ratio (EER) of at least 21.
``(7) Labor costs.--Expenditures for labor costs properly
allocable to the onsite preparation, assembly, or original
installation of the property described in paragraph (1), (2),
(4), (5), or (6) and for piping or wiring to interconnect
such property to the dwelling unit shall be taken into
account for purposes of this section.
``(8) Swimming pools, etc., used as storage medium.--
Expenditures which 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 shall not be
taken into account for purposes of this section.
``(e) Special Rules.--For purposes of this section--
``(1) Dollar amounts in case of joint occupancy.--In the
case of any dwelling unit which is 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 (as the case may be) made
during such 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 individual 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 proportionate share (as defined in section
216(b)(3)) of any expenditures of such corporation.
``(3) Condominiums.--
``(A) In general.--In the case of an individual 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 the individual's
proportionate share of any expenditures of such association.
``(B) Condominium management association.--For purposes of
this paragraph, the term `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 condominium project substantially
all of the units of which are used as residences.
``(4) Allocation in certain cases.--Except in the case of
qualified wind energy property expenditures, if less than 80
percent of the use of an item is 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.
``(5) 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 or
reconstruction of a structure, such expenditure shall be
treated as made when the original use of the constructed or
reconstructed structure by the taxpayer begins.
``(C) Amount.--The amount of any expenditure shall be the
cost thereof.
``(6) Property financed by subsidized energy financing.--
For purposes of determining the amount of 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
48(a)(5)(C)).
``(f) 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.
``(g) Termination.--The credit allowed under this section
shall not apply to expenditures after December 31, 2007.''.
(b) Credit Allowed Against Regular Tax and Alternative
Minimum Tax.--
(1) In general.--Section 25C(b), as added by subsection
(a), is amended by adding at the end the following new
paragraph:
``(3) Limitation based on amount of tax.--The credit
allowed under subsection (a) for the taxable year shall not
exceed the excess of--
``(A) the sum of the regular tax liability (as defined in
section 26(b)) plus the tax imposed by section 55, over
``(B) the sum of the credits allowable under this subpart
(other than this section and section 25D) and section 27 for
the taxable year.''.
(2) Conforming amendments.--
(A) Section 25C(c), as added by subsection (a), is amended
by striking ``section 26(a) for such taxable year reduced by
the sum of the credits allowable under this subpart (other
than this section and section 25D)'' and inserting
``subsection (b)(3)''.
(B) Section 23(b)(4)(B) is amended by inserting ``and
section 25C'' after ``this section''.
(C) Section 24(b)(3)(B) is amended by striking ``23 and
25B'' and inserting ``23, 25B, and 25C''.
(D) Section 25(e)(1)(C) is amended by inserting ``25C,''
after ``25B,''.
(E) Section 25B(g)(2) is amended by striking ``section 23''
and inserting ``sections 23 and 25C''.
(F) Section 26(a)(1) is amended by striking ``and 25B'' and
inserting ``25B, and 25C''.
(G) Section 904(h) is amended by striking ``and 25B'' and
inserting ``25B, and 25C''.
(H) Section 1400C(d) is amended by striking ``and 25B'' and
inserting ``25B, and 25C''.
(c) Additional Conforming Amendments.--
(1) Section 23(c), as in effect for taxable years beginning
before January 1, 2004, is amended by striking ``section
1400C'' and inserting ``sections 25C and 1400C''.
(2) Section 25(e)(1)(C), as in effect for taxable years
beginning before January 1, 2004, is amended by inserting ``,
25Cs,'' after ``sections 23''.
(3) Subsection (a) of section 1016, as amended by this Act,
is amended by striking ``and'' at the end of paragraph (29),
by striking the period at the end of paragraph (30) and
inserting ``, and'', and by adding at the end the following
new paragraph:
``(31) to the extent provided in section 25C(f), in the
case of amounts with respect to which a credit has been
allowed under section 25C.''.
(4) Section 1400C(d), as in effect for taxable years
beginning before January 1, 2004, is amended by inserting
``and section 25C'' after ``this section''.
(5) The table of sections for subpart A of part IV of
subchapter A of chapter 1 is amended by

[[Page S10821]]

inserting after the item relating to section 25B the
following new item:

``Sec. 25C. Residential energy efficient property.''.

(d) Effective Dates.--
(1) In general.--Except as provided by paragraph (2), the
amendments made by this section shall apply to expenditures
after December 31, 2002, in taxable years ending after such
date.
(2) Subsection (b).--The amendments made by subsection (b)
shall apply to taxable years beginning after December 31,
2003.

SEC. 2104. CREDIT FOR BUSINESS INSTALLATION OF QUALIFIED FUEL
CELLS AND STATIONARY MICROTURBINE POWER PLANTS.

(a) In General.--Subparagraph (A) of section 48(a)(3)
(defining energy property) is amended by striking ``or'' at
the end of clause (i), by adding ``or'' at the end of clause
(ii), and by inserting after clause (ii) the following new
clause:
``(iii) qualified fuel cell property or qualified
microturbine property,''.
(b) Qualified Fuel Cell Property; Qualified Microturbine
Property.--Subsection (a) of section 48 is amended by
redesignating paragraphs (4) and (5) as paragraphs (5) and
(6), respectively, and by inserting after paragraph (3) the
following new paragraph:
``(4) Qualified fuel cell property; qualified microturbine
property.--For purposes of this subsection--
``(A) Qualified fuel cell property.--
``(i) In general.--The term `qualified fuel cell property'
means a fuel cell power plant that--

``(I) generates at least 0.5 kilowatt of electricity using
an electrochemical process, and
``(II) has an electricity-only generation efficiency
greater than 30 percent.

``(ii) Limitation.--In the case of qualified fuel cell
property placed in service during the taxable year, the
credit determined under paragraph (1) for such year with
respect to such property shall not exceed an amount equal to
the lesser of--

``(I) 30 percent of the basis of such property, or
``(II) $500 for each 0.5 kilowatt of capacity of such
property.

``(iii) Fuel cell power plant.--The term `fuel cell power
plant' means an integrated system comprised of a fuel cell
stack assembly and associated balance of plant components
that converts a fuel into electricity using electrochemical
means.
``(iv) Termination.--Such term shall not include any
property placed in service after December 31, 2007.
``(B) Qualified microturbine property.--
``(i) In general.--The term ``qualified microturbine
property' means a stationary microturbine power plant which
has an electricity-only generation efficiency not less than
26 percent at International Standard Organization conditions.
``(ii) Limitation.--In the case of qualified microturbine
property placed in service during the taxable year, the
credit determined under paragraph (1) for such year with
respect to such property shall not exceed an amount equal to
the lesser of--

``(I) 10 percent of the basis of such property, or
``(II) $200 for each kilowatt of capacity of such property.

``(iii) Stationary microturbine power plant.--The term
`stationary microturbine power plant means a system
comprising of a rotary engine which is actuated by the
aerodynamic reaction or impulse or both on radial or axial
curved full-circumferential-admission airfoils on a central
axial rotating spindle. Such system--

``(I) commonly includes an air compressor, combustor, gas
pathways which lead compressed air to the combustor and which
lead hot combusted gases from the combustor to 1 or more
rotating turbine spools, which in turn drive the compressor
and power output shaft,
``(II) includes a fuel compressor, recuperator/regenerator,
generator or alternator, integrated combined cycle equipment,
cooling-heating-and-power equipment, sound attenuation
apparatus, and power conditioning equipment, and
``(III) includes all secondary components located between
the existing infrastructure for fuel delivery and the
existing infrastructure for power distribution, including
equipment and controls for meeting relevant power standards,
such as voltage, frequency, and power factors.

``(iv) Termination.--Such term shall not include any
property placed in service after December 31, 2006.''.
(c) Limitation.--Section 48(a)(2)(A) (relating to energy
percentage) is amended to read as follows:
``(A) In general.--The energy percentage is--
``(i) in the case of qualified fuel cell property, 30
percent, and
``(ii) in the case of any other energy property, 10
percent.''.
(d) Conforming Amendments.--
(A) Section 29(b)(3)(A)(i)(III) is amended by striking
``section 48(a)(4)(C)'' and inserting ``section
48(a)(5)(C)''.
(B) Section 48(a)(1) is amended by inserting ``except as
provided in subparagraph (A)(ii) or (B)(ii) of paragraph
(4),'' before ``the energy''.
(e) Effective Date.--The amendments made by this subsection
shall apply to property placed in service after December 31,
2002, 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. 2105. ENERGY EFFICIENT COMMERCIAL BUILDINGS DEDUCTION.

(a) In General.--Part VI of subchapter B of chapter 1 is
amended by inserting after section 179A the following new
section:

``SEC. 179B. ENERGY EFFICIENT COMMERCIAL BUILDINGS DEDUCTION.

``(a) In General.--There shall be allowed as a deduction
for the taxable year an amount equal to the 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 subsection (a) shall not exceed an amount
equal to the product of--
``(1) $2.25, and
``(2) the square footage of the building with respect to
which the expenditures are made.
``(c) Year Deduction Allowed.--The deduction under
subsection (a) shall be allowed in the taxable year in which
the construction of the building is completed.
``(d) Energy Efficient Commercial Building Property
Expenditures.--For purposes of this section--
``(1) In general.--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 (2)). Such term includes
expenditures for labor costs properly allocable to the onsite
preparation, assembly, or original installation of the
property.
``(2) Energy efficient commercial building property.--For
purposes of paragraph (1)--
``(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 (5).
``(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 2001 California
Nonresidential Alternative Calculation Method Approval
Manual. These regulations 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 2001 California Nonresidential Alternative Calculation
Method Approval Manual, including the following:

``(I) Natural ventilation.
``(II) Evaporative cooling.
``(III) Automatic lighting controls such as occupancy
sensors, photocells, and timeclocks.
``(IV) Daylighting.
``(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.

[[Page S10822]]

``(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.

``(C) Computer software.--
``(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
calculating 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.

``(3) 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
taxpayer for purposes of this subsection.
``(4) 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 (2)(C)(ii)(III).
``(5) Certification.--
``(A) In general.--Except as provided in this paragraph,
the Secretary shall prescribe procedures for the inspection
and testing for compliance of buildings that are comparable,
given the difference between commercial and residential
buildings, to the requirements in the Mortgage Industry
National Accreditation Procedures for Home Energy Rating
Systems.
``(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. The Secretary may qualify a Home Ratings
Systems Organization, a local building code agency, a State
or local energy office, a utility, or any other organization
which meets the requirements prescribed under this section.
``(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.
``(e) Basis Reduction.--For purposes of this subtitle, if a
deduction is allowed under this section with respect to any
energy efficient commercial building property, the basis of
such property shall be reduced by the amount of the deduction
so allowed.
``(f) Regulations.--The Secretary shall promulgate such
regulations as necessary to take into account new
technologies regarding energy efficiency and renewable energy
for purposes of determining energy efficiency and savings
under this section.
``(g) Termination.--This section shall not apply with
respect to any energy efficient commercial building property
expenditures in connection with property--
``(1) the plans for which are not certified under
subsection (d)(5) on or before December 31, 2007, and
``(2) the construction of which is not completed on or
before December 31, 2009.''.
(b) Conforming Amendments.--
(1) Section 1016(a), as amended by this Act, is amended by
striking ``and'' at the end of paragraph (30), by striking
the period at the end of paragraph (31) and inserting ``,
and'', and by adding at the end the following new paragraph:
``(32) to the extent provided in section 179B(e).''.
(2) Section 1245(a) is amended by inserting ``179B,'' after
``179A,'' both places it appears in paragraphs (2)(C) and
(3)(C).
(3) Section 1250(b)(3) is amended by inserting before the
period at the end of the first sentence ``or by section
179B''.
(4) Section 263(a)(1) is amended by striking ``or'' at the
end of subparagraph (G), by striking the period at the end of
subparagraph (H) and inserting ``, or'', and by inserting
after subparagraph (H) the following new subparagraph:
``(I) expenditures for which a deduction is allowed under
section 179B.''.
(5) Section 312(k)(3)(B) is amended by striking ``or 179A''
each place it appears in the heading and text and inserting
``, 179A, or 179B''.
(c) Clerical Amendment.--The table of sections for part VI
of subchapter B of chapter 1 is amended by inserting after
section 179A the following new item:

``Sec. 179B. Energy efficient commercial buildings deduction.''.

(d) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after September 30,
2002.

SEC. 2106. ALLOWANCE OF DEDUCTION FOR QUALIFIED NEW OR
RETROFITTED ENERGY MANAGEMENT DEVICES.

(a) In General.--Part VI of subchapter B of chapter 1
(relating to itemized deductions for individuals and
corporations), as amended by this Act, is amended by
inserting after section 179B the following new section:

``SEC. 179C. DEDUCTION FOR QUALIFIED NEW OR RETROFITTED
ENERGY MANAGEMENT DEVICES.

``(a) Allowance of Deduction.--In the case of a taxpayer
who is a supplier of electric energy or natural gas or a
provider of electric energy or natural gas services, there
shall be allowed as a deduction an amount equal to the cost
of each qualified energy management device placed in service
during the taxable year.
``(b) Maximum Deduction.--The deduction allowed by this
section with respect to each qualified energy management
device shall not exceed $30.
``(c) Qualified Energy Management Device.--The term
`qualified energy management device' means any tangible
property to which section 168 applies if such property is a
meter or metering device--
``(1) which is acquired and used by the taxpayer to enable
consumers to manage their purchase or use of electricity or
natural gas in response to energy price and usage signals,
and
``(2) which permits reading of energy price and usage
signals on at least a daily basis.
``(d) Property Used Outside the United States Not
Qualified.--No deduction shall be allowed under subsection
(a) with respect to property which is used predominantly
outside the United States or with respect to the portion of
the cost of any property taken into account under section
179.
``(e) Basis Reduction.--
``(1) In general.--For purposes of this title, the basis of
any property shall be reduced by the amount of the deduction
with respect to such property which is allowed by subsection
(a).
``(2) Ordinary income recapture.--For purposes of section
1245, the amount of the deduction allowable under subsection
(a) with respect to any property that is of a character
subject to the allowance for depreciation shall be treated as
a deduction allowed for depreciation under section 167.''.
(b) Conforming Amendments.--
(1) Section 263(a)(1), as amended by this Act, is amended
by striking ``or'' at the end of subparagraph (H), by
striking the period at the end of subparagraph (I) and
inserting ``, or'', and by inserting after subparagraph (I)
the following new subparagraph:
``(J) expenditures for which a deduction is allowed under
section 179C.''.
(2) Section 312(k)(3)(B), as amended by this Act, is
amended by striking ``or 179B'' each place it appears in the
heading and text and inserting ``, 179B, or 179C''.
(3) Section 1016(a), as amended by this Act, is amended by
striking ``and'' at the end of paragraph (31), by striking
the period at the end of paragraph (32) and inserting ``,
and'', and by adding at the end the following new paragraph:
``(33) to the extent provided in section 179C(e)(1).''.
(4) Section 1245(a), as amended by this Act, is amended by
inserting ``179C,'' after ``179B,'' both places it appears in
paragraphs (2)(C) and (3)(C).
(5) The table of contents for subpart B of part IV of
subchapter A of chapter 1, as amended by this Act, is amended
by inserting after the item relating to section 179B the
following new item:

``Sec. 179C. Deduction for qualified new or retrofitted energy
management devices.''.

(c) Effective Date.--The amendments made by this section
shall apply to qualified energy management devices placed in
service after the date of the enactment of this Act, in
taxable years ending after such date.

SEC. 2107. THREE-YEAR APPLICABLE RECOVERY PERIOD FOR
DEPRECIATION OF QUALIFIED ENERGY MANAGEMENT
DEVICES.

(a) In General.--Subparagraph (A) of section 168(e)(3)
(relating to classification of property) 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 new clause:
``(iv) any qualified energy management device.''.
(b) Definition of Qualified Energy Management Device.--
Section 168(i) (relating to definitions and special rules) is
amended by inserting at the end the following new paragraph:
``(15) Qualified energy management device.--The term
`qualified energy management device' means any qualified
energy management device as defined in section 179C(c) which
is placed in service by a taxpayer who is a supplier of
electric energy or natural gas or a provider of electric
energy or natural gas services.''.
(c) Effective Date.--The amendments made by this section
shall apply to property placed in service after the date of
the enactment of this Act, in taxable years ending after such
date.

SEC. 2108. ENERGY CREDIT FOR COMBINED HEAT AND POWER SYSTEM
PROPERTY.

(a) In General.--Subparagraph (A) of section 48(a)(3)
(defining energy property), as amended by this Act, is
amended by striking ``or'' at the end of clause (ii), by
adding ``or'' at the end of clause (iii), and by inserting
after clause (iii) the following new clause:
``(iv) combined heat and power system property,''.
(b) Combined Heat and Power System Property.--Subsection
(a) of section 48, as amended by this Act, is amended by
redesignating paragraphs (5) and (6) as paragraphs (6) and
(7), respectively, and by inserting after paragraph (4) the
following new paragraph:
``(5) Combined heat and power system property.--For
purposes of this subsection--
``(A) Combined heat and power system property.--The term
`combined heat and power system property' means property
comprising a system--
``(i) which uses the same energy source for the
simultaneous or sequential generation of electrical power,
mechanical shaft power, or both, in combination with the
generation of steam or other forms of useful thermal energy
(including heating and cooling applications),

[[Page S10823]]

``(ii) which 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,
``(iii) which produces--

``(I) at least 20 percent of its total useful energy in the
form of thermal energy, and
``(II) at least 20 percent of its total useful energy in
the form of electrical or mechanical power (or combination
thereof),

``(iv) the energy efficiency percentage of which exceeds 60
percent (70 percent in the case of a system with an
electrical capacity in excess of 50 megawatts or a mechanical
energy capacity in excess of 67,000 horsepower, or an
equivalent combination of electrical and mechanical energy
capacities), and
``(v) which is placed in service after December 31, 2002,
and before January 1, 2007.
``(B) Special rules.--
``(i) Energy efficiency percentage.--For purposes of
subparagraph (A)(iv), the energy efficiency percentage of a
system is the fraction--

``(I) the numerator of which is the total useful
electrical, thermal, and mechanical power produced by the
system at normal operating rates, and expected to be consumed
in its normal application, and
``(II) the denominator of which is the lower heating value
of the primary fuel source for the system.

``(ii) Determinations made on btu basis.--The energy
efficiency percentage and the percentages under subparagraph
(A)(iii) shall be determined on a Btu basis.
``(iii) Input and output property not included.--The term
`combined heat and power system property' does not include
property used to transport the energy source to the facility
or to distribute energy produced by the facility.
``(iv) Public utility property.--

``(I) Accounting rule for public utility property.--If the
combined heat and power system property is public utility
property (as defined in section 168(i)(10)), the taxpayer may
only claim the credit under the subsection if, with respect
to such property, the taxpayer uses a normalization method of
accounting.
``(II) Certain exception not to apply.--The matter
following paragraph (3)(D) shall not apply to combined heat
and power system property.

``(v) Nonapplication of certain rules.--For purposes of
determining if the term `combined heat and power system
property' includes technologies which generate electricity or
mechanical power using back-pressure steam turbines in place
of existing pressure-reducing valves or which make use of
waste heat from industrial processes such as by using organic
rankin, stirling, or kalina heat engine systems, subparagraph
(A) shall be applied without regard to clauses (iii) and (iv)
thereof.
``(C) Extension of depreciation recovery period.--If a
taxpayer is allowed credit under this section for combined
heat and power system property and such property would (but
for this subparagraph) have a class life of 15 years or less
under section 168, such property shall be treated as having a
22-year class life for purposes of section 168.''.
(c) No Carryback of Energy Credit Before Effective Date.--
Subsection (d) of section 39, as amended by this Act, is
amended by adding at the end the following new paragraph:
``(15) 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 with
respect to property described in section 48(a)(5) may be
carried back to a taxable year ending before January 1,
2003.''.
(d) Conforming Amendments.--
(A) Section 25C(e)(6), as added by this Act, is amended by
striking ``section 48(a)(5)(C)'' and inserting ``section
48(a)(6)(C)''.
(B) Section 29(b)(3)(A)(i)(III), as amended by this Act, is
amended by striking ``section 48(a)(5)(C)'' and inserting
``section 48(a)(6)(C)''.
(e) Effective Date.--The amendments made by this section
shall apply to property placed in service after December 31,
2002, in taxable years ending after such date.

SEC. 2109. CREDIT FOR ENERGY EFFICIENCY IMPROVEMENTS TO
EXISTING HOMES.

(a) In General.--Subpart A of part IV of subchapter A of
chapter 1 (relating to nonrefundable personal credits), as
amended by this Act, is amended by inserting after section
25C the following new section:

``SEC. 25D. ENERGY EFFICIENCY IMPROVEMENTS TO EXISTING HOMES.

``(a) Allowance of Credit.--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 10
percent of the amount paid or incurred by the taxpayer for
qualified energy efficiency improvements installed during
such taxable year.
``(b) Limitations.--
``(1) Maximum credit.--The credit allowed by this section
with respect to a dwelling shall not exceed $300.
``(2) Prior credit amounts for taxpayer on same dwelling
taken into account.--If a credit was allowed to the taxpayer
under subsection (a) with respect to a dwelling in 1 or more
prior taxable years, the amount of the credit otherwise
allowable for the taxable year with respect to that dwelling
shall not exceed the amount of $300 reduced by the sum of the
credits allowed under subsection (a) to the taxpayer with
respect to the dwelling for all prior taxable years.
``(c) Carryforward of Unused Credit.--If the credit
allowable under subsection (a) exceeds the limitation imposed
by section 26(a) for such taxable year reduced by the sum of
the credits allowable under this subpart (other than this
section) for any taxable year, such excess shall be carried
to the succeeding taxable year and added to the credit
allowable under subsection (a) for such succeeding taxable
year.
``(d) Qualified Energy Efficiency Improvements.--For
purposes of this section, the term `qualified energy
efficiency improvements' means any energy efficient building
envelope component which is certified to meet or exceed the
prescriptive criteria for such component in the 2000
International Energy Conservation Code, any energy efficient
building envelope component which is described in subsection
(f)(4)(B) and is certified by the Energy Star program managed
jointly by the Environmental Protection Agency and the
Department of Energy, or any combination of energy efficiency
measures which are certified as achieving at least a 30
percent reduction in heating and cooling energy usage for the
dwelling (as measured in terms of energy cost to the
taxpayer), if--
``(1) such component or combination of measures is
installed in or on a dwelling--
``(A) located in the United States, and
``(B) owned and used by the taxpayer as the taxpayer's
principal residence (within the meaning of section 121),
``(2) the original use of such component or combination of
measures commences with the taxpayer, and
``(3) such component or combination of measures reasonably
can be expected to remain in use for at least 5 years.
``(e) Certification.--
``(1) Methods of certification.--
``(A) Component-based method.--The certification described
in subsection (d) for any component described in such
subsection shall be determined on the basis of applicable
energy efficiency ratings (including product labeling
requirements) for affected building envelope components.
``(B) Performance-based method.--
``(i) In general.--The certification described in
subsection (d) for any combination of measures described in
such subsection shall be--

``(I) determined by comparing the projected heating and
cooling energy usage for the dwelling to such usage for such
dwelling in its original condition, and
``(II) accompanied by a written analysis documenting the
proper application of a permissible energy performance
calculation method to the specific circumstances of such
dwelling.

``(ii) Computer software.--Computer software shall be used
in support of a performance-based method certification under
clause (i). Such software shall meet procedures and methods
for calculating energy and cost savings in regulations
promulgated by the Secretary of Energy. Such regulations on
the specifications for software and verification protocols
shall be based on the 2001 California Residential Alternative
Calculation Method Approval Manual.
``(2) Provider.--A certification described in subsection
(d) shall be provided by--
``(A) in the case of the method described in paragraph
(1)(A), by a third party, such as a local building regulatory
authority, a utility, a manufactured home production
inspection primary inspection agency (IPIA), or a home energy
rating organization, or
``(B) in the case of the method described in paragraph
(1)(B), an individual recognized by an organization
designated by the Secretary for such purposes.
``(3) Form.--A certification described in subsection (d)
shall be made in writing on forms which specify in readily
inspectable fashion the energy efficient components and other
measures and their respective efficiency ratings, and which
include a permanent label affixed to the electrical
distribution panel of the dwelling.
``(4) Regulations.--
``(A) In general.--In prescribing regulations under this
subsection for certification methods described in paragraph
(1)(B), the Secretary, 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, shall prescribe
procedures for calculating annual energy usage and cost
reductions for heating and cooling and for the reporting of
the results. Such regulations shall--
``(i) provide that any calculation procedures be fuel
neutral such that the same energy efficiency measures allow a
dwelling to be eligible for the credit under this section
regardless of whether such dwelling uses a gas or oil furnace
or boiler or an electric heat pump, and
``(ii) require that any computer software allow for the
printing of the Federal tax forms necessary for the credit
under this section and for the printing of forms for
disclosure to the owner of the dwelling.
``(B) Providers.--For purposes of paragraph (2)(B), the
Secretary shall establish requirements for the designation of
individuals based on the requirements for energy consultants
and home energy raters specified by the Mortgage Industry
National Accreditation Procedures for Home Energy Rating
Systems.
``(f) Definitions and Special Rules.--For purposes of this
section--
``(1) Dollar amounts in case of joint occupancy.--In the
case of any dwelling unit which is 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 for the qualified energy
efficiency improvements made during such 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 individual during such
calendar year bears to the aggregate of

[[Page S10824]]

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 paid his tenant-
stockholder's proportionate share (as defined in section
216(b)(3)) of the cost of qualified energy efficiency
improvements made by such corporation.
``(3) Condominiums.--
``(A) In general.--In the case of an individual 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 paid the individual's
proportionate share of the cost of qualified energy
efficiency improvements made by such association.
``(B) Condominium management association.--For purposes of
this paragraph, the term `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 condominium project substantially
all of the units of which are used as residences.
``(4) Building envelope component.--The term `building
envelope component' means--
``(A) insulation material or system which is specifically
and primarily designed to reduce the heat loss or gain or a
dwelling when installed in or on such dwelling,
``(B) exterior windows (including skylights), and
``(C) exterior doors.
``(5) Manufactured homes included.--For purposes of this
section, the term `dwelling' includes a manufactured home
which conforms to Federal Manufactured Home Construction and
Safety Standards (24 C.F.R. 3280).
``(g) Basis Adjustment.--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.
``(h) Application of Section.--Subsection (a) shall apply
to qualified energy efficiency improvements installed during
the period beginning on the date of the enactment of this
section and ending on December 31, 2006.''.
(b) Credit Allowed Against Regular Tax and Alternative
Minimum Tax.--
(1) In general.--Section 25D(b), as added by subsection
(a), is amended by adding at the end the following new
paragraph:
``(3) Limitation based on amount of tax.--The credit
allowed under subsection (a) for the taxable year shall not
exceed the excess of--
``(A) the sum of the regular tax liability (as defined in
section 26(b)) plus the tax imposed by section 55, over
``(B) the sum of the credits allowable under this subpart
(other than this section) and section 27 for the taxable
year.''.
(2) Conforming amendments.--
(A) Section 25D(c), as added by subsection (a), is amended
by striking ``section 26(a) for such taxable year reduced by
the sum of the credits allowable under this subpart (other
than this section)'' and inserting ``subsection (b)(3)''.
(B) Section 23(b)(4)(B), as amended by this Act, is amended
by striking ``section 25C'' and inserting ``sections 25C and
25D''.
(C) Section 24(b)(3)(B), as amended by this Act, is amended
by striking ``and 25C'' and inserting ``25C, and 25D''.
(D) Section 25(e)(1)(C), as amended by this Act, is amended
by inserting ``25D,'' after ``25C,''.
(E) Section 25B(g)(2), as amended by this Act, is amended
by striking ``23 and 25C'' and inserting ``23, 25C, and
25D''.
(F) Section 26(a)(1), as amended by this Act, is amended by
striking ``and 25C'' and inserting ``25C, and 25D''.
(G) Section 904(h), as amended by this Act, is amended by
striking ``and 25C'' and inserting ``25C, and 25D''.
(H) Section 1400C(d), as amended by this Act, is amended by
striking ``and 25C'' and inserting ``25C, and 25D''.
(c) Additional Conforming Amendments.--
(1) Section 23(c), as in effect for taxable years beginning
before January 1, 2004, and as amended by this Act, is
amended by inserting ``, 25D,'' after ``sections 25C''.
(2) Section 25(e)(1)(C), as in effect for taxable years
beginning before January 1, 2004, and as amended by this Act,
is amended by inserting ``25D,'' after ``25C,''.
(3) Subsection (a) of section 1016, as amended by this Act,
is amended by striking ``and'' at the end of paragraph (32),
by striking the period at the end of paragraph (33) and
inserting ``; and'', and by adding at the end the following
new paragraph:
``(34) to the extent provided in section 25D(f), in the
case of amounts with respect to which a credit has been
allowed under section 25D.''.
(4) Section 1400C(d), as in effect for taxable years
beginning before January 1, 2004, and as amended by this Act,
is amended by striking ``section 25C'' and inserting
``sections 25C and 25D''.
(5) The table of sections for subpart A of part IV of
subchapter A of chapter 1, as amended by this Act, is amended
by inserting after the item relating to section 25C the
following new item:

``Sec. 25D. Energy efficiency improvements to existing homes.''.

(d) Effective Dates.--
(1) In general.--Except as provided by paragraph (2), the
amendments made by this section shall apply to expenditures
after December 31, 2002, in taxable years ending after such
date.
(2) Subsection (b).--The amendments made by subsection (b)
shall apply to taxable years beginning after December 31,
2003.

SEC. 2110. ALLOWANCE OF DEDUCTION FOR QUALIFIED NEW OR
RETROFITTED WATER SUBMETERING DEVICES.

(a) In General.--Part VI of subchapter B of chapter 1
(relating to itemized deductions for individuals and
corporations), as amended by this Act, is amended by
inserting after section 179D the following new section:

``SEC. 179E. DEDUCTION FOR QUALIFIED NEW OR RETROFITTED WATER
SUBMETERING DEVICES.

``(a) Allowance of Deduction.--In the case of a taxpayer
who is an eligible resupplier, there shall be allowed as a
deduction an amount equal to the cost of each qualified water
submetering device placed in service during the taxable year.
``(b) Maximum Deduction.--The deduction allowed by this
section with respect to each qualified water submetering
device shall not exceed $30.
``(c) Eligible Resupplier.--For purposes of this section,
the term `eligible resupplier' means any taxpayer who
purchases and installs qualified water submetering devices in
every unit in any multi-unit property.
``(d) Qualified Water Submetering Device.--The term
`qualified water submetering device' means any tangible
property to which section 168 applies if such property is a
submetering device (including ancillary equipment)--
``(1) which is purchased and installed by the taxpayer to
enable consumers to manage their purchase or use of water in
response to water price and usage signals, and
``(2) which permits reading of water price and usage
signals on at least a daily basis.
``(e) Property Used Outside the United States Not
Qualified.--No deduction shall be allowed under subsection
(a) with respect to property which is used predominantly
outside the United States or with respect to the portion of
the cost of any property taken into account under section
179.
``(f) Basis Reduction.--
``(1) In general.--For purposes of this title, the basis of
any property shall be reduced by the amount of the deduction
with respect to such property which is allowed by subsection
(a).
``(2) Ordinary income recapture.--For purposes of section
1245, the amount of the deduction allowable under subsection
(a) with respect to any property that is of a character
subject to the allowance for depreciation shall be treated as
a deduction allowed for depreciation under section 167.
``(g) Termination.--This section shall not apply to any
property placed in service after December 31, 2007.''.
(b) Conforming Amendments.--
(1) Section 263(a)(1), as amended by this Act, is amended
by striking ``or'' at the end of subparagraph (J), by
striking the period at the end of subparagraph (K) and
inserting ``, or'', and by inserting after subparagraph (K)
the following new subparagraph:
``(L) expenditures for which a deduction is allowed under
section 179E.''.
(2) Section 312(k)(3)(B), as amended by this Act, is
amended by striking ``or 179D'' each place it appears in the
heading and text and inserting ``, 179D, or 179E''.
(3) Section 1016(a), as amended by this Act, is amended by
striking ``and'' at the end of paragraph (34), by striking
the period at the end of paragraph (35) and inserting ``,
and'', and by adding at the end the following new paragraph:
``(36) to the extent provided in section 179E(f)(1).''.
(4) Section 1245(a), as amended by this Act, is amended by
inserting ``179E,'' after ``179D,'' both places it appears in
paragraphs (2)(C) and (3)(C).
(5) The table of contents for subpart B of part IV of
subchapter A of chapter 1, as amended by this Act, is amended
by inserting after the item relating to section 179D the
following new item:

``Sec. 179E. Deduction for qualified new or retrofitted water
submetering devices.''.

(c) Effective Date.--The amendments made by this section
shall apply to qualified water submetering devices placed in
service after the date of the enactment of this Act, in
taxable years ending after such date.

SEC. 2111. THREE-YEAR APPLICABLE RECOVERY PERIOD FOR
DEPRECIATION OF QUALIFIED WATER SUBMETERING
DEVICES.

(a) In General.--Subparagraph (A) of section 168(e)(3)
(relating to classification of property) 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 new clause:
``(v) any qualified water submetering device.''.
(b) Definition of Qualified Water Submetering Device.--
Section 168(i) (relating to definitions and special rules),
as amended by this Act, is amended by inserting at the end
the following new paragraph:
``(16) Qualified water submetering device.--The term
`qualified water submetering device' means any qualified
water submetering device (as defined in section 179E(d))
which is placed in service before January 1, 2008, by a
taxpayer who is an eligible resupplier (as defined in section
179E(c)).''.
(c) Effective Date.--The amendments made by this section
shall apply to property placed in service after the date of
the enactment of this Act, in taxable years ending after such
date.

TITLE XXII--CLEAN COAL INCENTIVES

Subtitle A--Credit for Emission Reductions and Efficiency Improvements
in Existing Coal-Based Electricity Generation Facilities

SEC. 2201. CREDIT FOR PRODUCTION FROM A QUALIFYING CLEAN COAL
TECHNOLOGY UNIT.

(a) Credit for Production From a Qualifying Clean Coal
Technology Unit.--Subpart

[[Page S10825]]

D of part IV of subchapter A of chapter 1 (relating to
business related credits), as amended by this Act, is amended
by adding at the end the following new section:

``SEC. 45I. CREDIT FOR PRODUCTION FROM A QUALIFYING CLEAN
COAL TECHNOLOGY UNIT.

``(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 product of--
``(1) the applicable amount of clean coal technology
production credit, multiplied by
``(2) the applicable percentage of the kilowatt hours of
electricity produced by the taxpayer during such taxable year
at a qualifying clean coal technology unit, but only if such
production occurs during the 10-year period beginning on the
date the unit was returned to service after becoming a
qualifying clean coal technology unit.
``(b) Applicable Amount.--
``(1) In general.--For purposes of this section, the
applicable amount of clean coal technology production credit
is equal to $0.0034.
``(2) Inflation adjustment.--For calendar years after 2003,
the applicable amount of clean coal technology production
credit shall 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.
``(c) Applicable Percentage.--For purposes of this section,
with respect to any qualifying clean coal technology unit,
the applicable percentage is the percentage equal to the
ratio which the portion of the national megawatt capacity
limitation allocated to the taxpayer with respect to such
unit under subsection (e) bears to the total megawatt
capacity of such unit.
``(d) Definitions and Special Rules.--For purposes of this
section--
``(1) Qualifying clean coal technology unit.--The term
`qualifying clean coal technology unit' means a clean coal
technology unit of the taxpayer which--
``(A) on the date of the enactment of this section was a
coal-based electricity generating steam generator-turbine
unit which was not a clean coal technology unit,
``(B) has a nameplate capacity rating of not more than
300,000 kilowatts,
``(C) becomes a clean coal technology unit as the result of
the retrofitting, repowering, or replacement of the unit with
clean coal technology during the 10-year period beginning on
the date of the enactment of this section,
``(D) is not receiving nor is scheduled to receive funding
under the Clean Coal Technology Program, the Power Plant
Improvement Initiative, or the Clean Coal Power Initiative
administered by the Secretary of Energy, and
``(E) receives an allocation of a portion of the national
megawatt capacity limitation under subsection (e).
``(2) Clean coal technology unit.--The term `clean coal
technology unit' means a unit which--
``(A) uses clean coal technology, including advanced
pulverized coal or atmospheric fluidized bed combustion,
pressurized fluidized bed combustion, integrated gasification
combined cycle, or any other technology for the production of
electricity,
``(B) uses coal to produce 75 percent or more of its
thermal output as electricity,
``(C) has a design net heat rate of at least 500 less than
that of such unit as described in paragraph (1)(A),
``(D) has a maximum design net heat rate of not more than
9,500, and
``(E) meets the pollution control requirements of paragraph
(3).
``(3) Pollution control requirements.--
``(A) In general.--A unit meets the requirements of this
paragraph if--
``(i) its emissions of sulfur dioxide, nitrogen oxide, or
particulates meet the lower of the emission levels for each
such emission specified in--

``(I) subparagraph (B), or
``(II) the new source performance standards of the Clean
Air Act (42 U.S.C. 7411) which are in effect for the category
of source at the time of the retrofitting, repowering, or
replacement of the unit, and

``(ii) its emissions do not exceed any relevant emission
level specified by regulation pursuant to the hazardous air
pollutant requirements of the Clean Air Act (42 U.S.C. 7412)
in effect at the time of the retrofitting, repowering, or
replacement.
``(B) Specific levels.--The levels specified in this
subparagraph are--
``(i) in the case of sulfur dioxide emissions, 50 percent
of the sulfur dioxide emission levels specified in the new
source performance standards of the Clean Air Act (42 U.S.C.
7411) in effect on the date of the enactment of this section
for the category of source,
``(ii) in the case of nitrogen oxide emissions--

``(I) 0.1 pound per million Btu of heat input if the unit
is not a cyclone-fired boiler, and
``(II) if the unit is a cyclone-fired boiler, 15 percent of
the uncontrolled nitrogen oxide emissions from such boilers,
and

``(iii) in the case of particulate emissions, 0.02 pound
per million Btu of heat input.
``(4) Design net heat rate.--The design net heat rate with
respect to any unit, measured in Btu per kilowatt hour
(HHV)--
``(A) shall be based on the design annual heat input to and
the design annual net electrical output from such unit
(determined without regard to such unit's co-generation of
steam),
``(B) shall be adjusted for the heat content of the design
coal to be used by the unit if it is less than 12,000 Btu per
pound according to the following formula:

Design net heat rate = Unit net heat rate X [l- {((12,000-
design coal heat content, Btu per pound)/1,000) X 0.013}],
and
``(C) shall be corrected for the site reference conditions
of--
``(i) elevation above sea level of 500 feet,
``(ii) air pressure of 14.4 pounds per square inch absolute
(psia),
``(iii) temperature, dry bulb of 63 deg.F,
``(iv) temperature, wet bulb of 54 deg.F, and
``(v) relative humidity of 55 percent.
``(5) HHV.--The term `HHV' means higher heating value.
``(6) Application of certain rules.--The rules of
paragraphs (3), (4), and (5) of section 45(d) shall apply.
``(7) Inflation adjustment factor.--
``(A) In general.--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 2002.
``(B) GDP implicit price deflator.--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.
``(8) Noncompliance with pollution laws.--For purposes of
this section, a unit which is not in compliance with the
applicable State and Federal pollution prevention, control,
and permit requirements for any period of time shall not be
considered to be a qualifying clean coal technology unit
during such period.
``(e) National Limitation on the Aggregate Capacity of
Qualifying Clean Coal Technology Units.--
``(1) In general.--For purposes of subsection (d)(1)(E),
the national megawatt capacity limitation for qualifying
clean coal technology units is 4,000 megawatts.
``(2) Allocation of limitation.--The Secretary shall
allocate the national megawatt capacity limitation for
qualifying clean coal technology units in such manner as the
Secretary may prescribe under the regulations under paragraph
(3).
``(3) Regulations.--Not later than 6 months after the date
of the enactment of this section, the Secretary shall
prescribe such regulations as may be necessary or
appropriate--
``(A) to carry out the purposes of this subsection,
``(B) to limit the capacity of any qualifying clean coal
technology unit to which this section applies so that the
combined megawatt capacity allocated to all such units under
this subsection when all such units are placed in service
during the 10-year period described in subsection (d)(1)(C),
does not exceed 4,000 megawatts,
``(C) to provide a certification process under which the
Secretary, in consultation with the Secretary of Energy,
shall approve and allocate the national megawatt capacity
limitation--
``(i) to encourage that units with the highest thermal
efficiencies, when adjusted for the heat content of the
design coal and site reference conditions described in
subsection (d)(4)(C), and environmental performance be placed
in service as soon as possible,
``(ii) to allocate capacity to taxpayers that have a
definite and credible plan for placing into commercial
operation a qualifying clean coal technology unit,
including--

``(I) a site,
``(II) contractual commitments for procurement and
construction or, in the case of regulated utilities, the
agreement of the State utility commission,
``(III) filings for all necessary preconstruction
approvals,
``(IV) a demonstrated record of having successfully
completed comparable projects on a timely basis, and
``(V) such other factors that the Secretary determines are
appropriate,

``(D) to allocate the national megawatt capacity limitation
to a portion of the capacity of a qualifying clean coal
technology unit if the Secretary determines that such an
allocation would maximize the amount of efficient production
encouraged with the available tax credits,
``(E) to set progress requirements and conditional
approvals so that capacity allocations for clean coal
technology units that become unlikely to meet the necessary
conditions for qualifying can be reallocated by the Secretary
to other clean coal technology units, and
``(F) to provide taxpayers with opportunities to correct
administrative errors and omissions with respect to
allocations and record keeping within a reasonable period
after discovery, taking into account the availability of
regulations and other administrative guidance from the
Secretary.''.
(b) Credit Treated as Business Credit.--Section 38(b), as
amended by this Act, is amended by striking ``plus'' at the
end of paragraph (18), by striking the period at the end of
paragraph (19) and inserting ``, plus'', and by adding at the
end the following new paragraph:
``(20) the qualifying clean coal technology production
credit determined under section 45I(a).''.
(c) Transitional Rule.--Section 39(d) (relating to
transitional rules), as amended by this Act, is amended by
adding at the end the following new paragraph:
``(16) No carryback of section 45i credit before effective
date.--No portion of the unused business credit for any
taxable year which is attributable to the qualifying clean
coal technology production credit determined under section
45I may be carried back to a taxable year ending on or before
the date of the enactment of section 45I.''.
(d) Clerical Amendment.--The table of sections for subpart
D of part IV of subchapter A of chapter 1, as amended by this
Act, is amended by adding at the end the following new item:

[[Page S10826]]

``Sec. 45I. Credit for production from a qualifying clean coal
technology unit.''.

(e) Effective Date.--The amendments made by this section
shall apply to production after the date of the enactment of
this Act, in taxable years ending after such date.

Subtitle B--Incentives for Early Commercial Applications of Advanced
Clean Coal Technologies

SEC. 2211. CREDIT FOR INVESTMENT IN QUALIFYING ADVANCED CLEAN
COAL TECHNOLOGY.

(a) Allowance of Qualifying Advanced Clean Coal Technology
Unit 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 new
paragraph:
``(4) the qualifying advanced clean coal technology unit
credit.''.
(b) Amount of Qualifying Advanced Clean Coal Technology
Unit Credit.--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 new
section:

``SEC. 48A. QUALIFYING ADVANCED CLEAN COAL TECHNOLOGY UNIT
CREDIT.

``(a) In General.--For purposes of section 46, the
qualifying advanced clean coal technology unit credit for any
taxable year is an amount equal to 10 percent of the
applicable percentage of the qualified investment in a
qualifying advanced clean coal technology unit for such
taxable year.
``(b) Qualifying Advanced Clean Coal Technology Unit.--
``(1) In general.--For purposes of subsection (a), the term
`qualifying advanced clean coal technology unit' means an
advanced clean coal technology unit of the taxpayer--
``(A)(i)(I) in the case of a unit first placed in service
after the date of the enactment of this section, the original
use of which commences with the taxpayer, or
``(II) in the case of the retrofitting or repowering of a
unit first placed in service before such date of enactment,
the retrofitting or repowering of which is completed by the
taxpayer after such date, or
``(ii) which is acquired through purchase (as defined by
section 179(d)(2)),
``(B) which is depreciable under section 167,
``(C) which has a useful life of not less than 4 years,
``(D) which is located in the United States,
``(E) which is not receiving nor is scheduled to receive
funding under the Clean Coal Technology Program, the Power
Plant Improvement Initiative, or the Clean Coal Power
Initiative administered by the Secretary of Energy,
``(F) which is not a qualifying clean coal technology unit,
and
``(G) which receives an allocation of a portion of the
national megawatt capacity limitation under subsection (f).
``(2) Special rule for sale-leasebacks.--For purposes of
subparagraph (A) of paragraph (1), in the case of a unit
which--
``(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 unit was
originally placed in service, for a period of not less than
12 years,

such unit shall be treated as originally placed in service
not earlier than the date on which such unit 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) Noncompliance with pollution laws.--For purposes of
this subsection, a unit which is not in compliance with the
applicable State and Federal pollution prevention, control,
and permit requirements for any period of time shall not be
considered to be a qualifying advanced clean coal technology
unit during such period.
``(c) Applicable Percentage.--For purposes of this section,
with respect to any qualifying advanced clean coal technology
unit, the applicable percentage is the percentage equal to
the ratio which the portion of the national megawatt capacity
limitation allocated to the taxpayer with respect to such
unit under subsection (f) bears to the total megawatt
capacity of such unit.
``(d) Advanced Clean Coal Technology Unit.--For purposes of
this section--
``(1) In general.--The term `advanced clean coal technology
unit' means a new, retrofit, or repowering unit of the
taxpayer which--
``(A) is--
``(i) an eligible advanced pulverized coal or atmospheric
fluidized bed combustion technology unit,
``(ii) an eligible pressurized fluidized bed combustion
technology unit,
``(iii) an eligible integrated gasification combined cycle
technology unit, or
``(iv) an eligible other technology unit, and
``(B) meets the carbon emission rate requirements of
paragraph (6).
``(2) Eligible advanced pulverized coal or atmospheric
fluidized bed combustion technology unit.--The term `eligible
advanced pulverized coal or atmospheric fluidized bed
combustion technology unit' means a clean coal technology
unit using advanced pulverized coal or atmospheric fluidized
bed combustion technology which--
``(A) is placed in service after the date of the enactment
of this section and before January 1, 2013, and
``(B) has a design net heat rate of not more than 8,350
(8,750 in the case of units placed in service before 2009).
``(3) Eligible pressurized fluidized bed combustion
technology unit.--The term `eligible pressurized fluidized
bed combustion technology unit' means a clean coal technology
unit using pressurized fluidized bed combustion technology
which--
``(A) is placed in service after the date of the enactment
of this section and before January 1, 2017, and
``(B) has a design net heat rate of not more than 7,720
(8,750 in the case of units placed in service before 2009,
and 8,350 in the case of units placed in service after 2008
and before 2013).
``(4) Eligible integrated gasification combined cycle
technology unit.--The term `eligible integrated gasification
combined cycle technology unit' means a clean coal technology
unit using integrated gasification combined cycle technology,
with or without fuel or chemical co-production, which--
``(A) is placed in service after the date of the enactment
of this section and before January 1, 2017,
``(B) has a design net heat rate of not more than 7,720
(8,750 in the case of units placed in service before 2009,
and 8,350 in the case of units placed in service after 2008
and before 2013), and
``(C) has a net thermal efficiency (HHV) using coal with
fuel or chemical co-production of not less than 43.9 percent
(39 percent in the case of units placed in service before
2009, and 40.9 percent in the case of units placed in service
after 2008 and before 2013).
``(5) Eligible other technology unit.--The term `eligible
other technology unit' means a clean coal technology unit
using any other technology for the production of electricity
which is placed in service after the date of the enactment of
this section and before January 1, 2017.
``(6) Carbon emission rate requirements.--
``(A) In general.--Except as provided in subparagraph (B),
a unit meets the requirements of this paragraph if--
``(i) in the case of a unit using design coal with a heat
content of not more than 9,000 Btu per pound, the carbon
emission rate is less than 0.60 pound of carbon per kilowatt
hour, and
``(ii) in the case of a unit using design coal with a heat
content of more than 9,000 Btu per pound, the carbon emission
rate is less than 0.54 pound of carbon per kilowatt hour.
``(B) Eligible other technology unit.--In the case of an
eligible other technology unit, subparagraph (A) shall be
applied by substituting `0.51' and `0.459' for `0.60' and
`0.54', respectively.
``(e) General Definitions.--Any term used in this section
which is also used in section 45I shall have the meaning
given such term in section 45I.
``(f) National Limitation on the Aggregate Capacity of
Advanced Clean Coal Technology Units.--
``(1) In general.--For purposes of subsection (b)(1)(G),
the national megawatt capacity limitation is--
``(A) for qualifying advanced clean coal technology units
using advanced pulverized coal or atmospheric fluidized bed
combustion technology, not more than 1,000 megawatts (not
more than 500 megawatts in the case of units placed in
service before 2009),
``(B) for such units using pressurized fluidized bed
combustion technology, not more than 500 megawatts (not more
than 250 megawatts in the case of units placed in service
before 2009),
``(C) for such units using integrated gasification combined
cycle technology, with or without fuel or chemical co-
production, not more than 2,000 megawatts (not more than
1,000 megawatts in the case of units placed in service before
2009 and not more than 1,500 megawatts in the case of units
placed in service after 2008 and before 2013), and
``(D) for such units using other technology for the
production of electricity, not more than 500 megawatts (not
more than 250 megawatts in the case of units placed in
service before 2009).
``(2) Allocation of limitation.--The Secretary shall
allocate the national megawatt capacity limitation for
qualifying advanced clean coal technology units in such
manner as the Secretary may prescribe under the regulations
under paragraph (3).
``(3) Regulations.--Not later than 6 months after the date
of the enactment of this section, the Secretary shall
prescribe such regulations as may be necessary or
appropriate--
``(A) to carry out the purposes of this subsection and
section 45J,
``(B) to limit the capacity of any qualifying advanced
clean coal technology unit to which this section applies so
that the combined megawatt capacity of all such units to
which this section applies does not exceed 4,000 megawatts,
``(C) to provide a certification process described in
section 45I(e)(3)(C),
``(D) to carry out the purposes described in subparagraphs
(D), (E), and (F) of section 45I(e)(3), and
``(E) to reallocate capacity which is not allocated to any
technology described in subparagraphs (A) through (D) of
paragraph (1) because an insufficient number of qualifying
units request an allocation for such technology, to another
technology described in such subparagraphs in order to
maximize the amount of energy efficient production encouraged
with the available tax credits.
``(4) Selection criteria.--For purposes of paragraph
(3)(C), the selection criteria for allocating the national
megawatt capacity limitation to qualifying advanced clean
coal technology units--
``(A) shall be established by the Secretary of Energy as
part of a competitive solicitation,
``(B) shall include primary criteria of minimum design net
heat rate, maximum design thermal efficiency, environmental
performance, and lowest cost to the Government, and
``(C) shall include supplemental criteria as determined
appropriate by the Secretary of Energy.

[[Page S10827]]

``(g) Qualified Investment.--For purposes of subsection
(a), the term `qualified investment' means, with respect to
any taxable year, the basis of a qualifying advanced clean
coal technology unit placed in service by the taxpayer during
such taxable year (in the case of a unit described in
subsection (b)(1)(A)(i)(II), only that portion of the basis
of such unit which is properly attributable to the
retrofitting or repowering of such unit).
``(h) 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 (g) without regard
to this subsection) 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 advanced clean coal technology unit 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) Nonself-constructed property.--In the case of
nonself-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) Nonself-constructed property.--The term `nonself-
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 advanced clean coal
technology unit 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.
``(i) 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 48 is allowed unless the taxpayer elects to
waive the application of such credit to such property.''.
(c) Recapture.--Section 50(a) (relating to other special
rules) is amended by adding at the end the following new
paragraph:
``(6) Special rules relating to qualifying advanced clean
coal technology unit.--For purposes of applying this
subsection in the case of any credit allowable by reason of
section 48A, 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 advanced clean coal technology unit (as defined by
section 48A(b)(1)) multiplied by a fraction whose numerator
is the number of years remaining to fully depreciate under
this title the qualifying advanced clean coal technology unit
disposed of, and whose denominator is the total number of
years over which such unit would otherwise have been subject
to depreciation. For purposes of the preceding sentence, the
year of disposition of the qualifying advanced clean coal
technology unit 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 advanced clean coal technology unit under
section 48A, except that the amount of the increase in tax
under subparagraph (A) of this paragraph shall be substituted
for 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 advanced clean coal
technology unit.''.
(d) Transitional Rule.--Section 39(d) (relating to
transitional rules), as amended by this Act, is amended by
adding at the end the following new paragraph:
``(17) No carryback of section 48a credit before effective
date.--No portion of the unused business credit for any
taxable year which is attributable to the qualifying advanced
clean coal technology unit credit determined under section
48A may be carried back to a taxable year ending on or before
the date of the enactment of section 48A.''.
(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 new clause:
``(iv) the portion of the basis of any qualifying advanced
clean coal technology unit attributable to any qualified
investment (as defined by section 48A(g)).''.
(2) Section 50(a)(4) is amended by striking ``and (2)'' and
inserting ``(2), and (6)''.
(3) Section 50(c) is amended by adding at the end the
following new paragraph:
``(6) Nonapplication.--Paragraphs (1) and (2) shall not
apply to any qualifying advanced clean coal technology unit
credit under section 48A.''.
(4) The table of sections for subpart E of part IV of
subchapter A of chapter 1 is amended by inserting after the
item relating to section 48 the following new item:

``Sec. 48A. Qualifying advanced clean coal technology unit credit.''.

(f) Effective Date.--The amendments made by this section
shall apply to periods after the date of the enactment of
this Act, 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. 2212. CREDIT FOR PRODUCTION FROM A QUALIFYING ADVANCED
CLEAN COAL TECHNOLOGY UNIT.

(a) In General.--Subpart D of part IV of subchapter A of
chapter 1 (relating to business related credits), as amended
by this Act, is amended by adding at the end the following
new section:

``SEC. 45J. CREDIT FOR PRODUCTION FROM A QUALIFYING ADVANCED
CLEAN COAL TECHNOLOGY UNIT.

``(a) General Rule.--For purposes of section 38, the
qualifying advanced clean coal technology production credit
of any taxpayer for any taxable year is equal to--
``(1) the applicable amount of advanced clean coal
technology production credit, multiplied by
``(2) the applicable percentage (as determined under
section 48A(c)) of the sum of--
``(A) the kilowatt hours of electricity, plus
``(B) each 3,413 Btu of fuels or chemicals,
produced by the taxpayer during such taxable year at a
qualifying advanced clean coal technology unit during the 10-
year period beginning on the date the unit was originally
placed in service (or returned to service after becoming a
qualifying advanced clean coal technology unit).
``(b) Applicable Amount.--For purposes of this section, the
applicable amount of advanced clean coal technology
production credit with respect to production from a
qualifying advanced clean coal technology unit shall be
determined as follows:
``(1) Where the qualifying advanced clean coal technology
unit is producing electricity only:
``(A) In the case of a unit originally placed in service
before 2009, if--

------------------------------------------------------------------------
The applicable amount is:
-----------------------------------
``The design net heat rate is:      For 1st 5 years   For 2d 5 years
of such service   of such service
------------------------------------------------------------------------
Not more than 8,400.................       $.0060            $.0038
More than 8,400 but not more than          $.0025            $.0010
8,550.
More than 8,550 but less than 8,750.       $.0010            $.0010.
------------------------------------------------------------------------

``(B) In the case of a unit originally placed in service
after 2008 and before 2013, if--

------------------------------------------------------------------------
The applicable amount is:
-----------------------------------
``The design net heat rate is:      For 1st 5 years   For 2d 5 years
of such service   of such service
------------------------------------------------------------------------

Not more than 7,770.................       $.0105            $.0090
More than 7,770 but not more than          $.0085            $.0068
8,125.
More than 8,125 but less than 8,350.       $.0075            $.0055.
------------------------------------------------------------------------

``(C) In the case of a unit originally placed in service
after 2012 and before 2017, if--

------------------------------------------------------------------------
The applicable amount is:
-----------------------------------
``The design net heat rate is:      For 1st 5 years   For 2d 5 years
of such service   of such service
------------------------------------------------------------------------
Not more than 7,380.................       $.0140            $.0115
More than 7,380 but not more than          $.0120            $.0090.
7,720.
------------------------------------------------------------------------

``(2) Where the qualifying advanced clean coal technology
unit is producing fuel or chemicals:
``(A) In the case of a unit originally placed in service
before 2009, if--

------------------------------------------------------------------------
The applicable amount is:
``The unit design net thermal    -----------------------------------
efficiency (HHV) is:           For 1st 5 years   For 2d 5 years
of such service   of such service
------------------------------------------------------------------------
Not less than 40.6 percent..........       $.0060            $.0038
Less than 40.6 but not less than 40        $.0025            $.0010
percent.
Less than 40 but not less than 39          $.0010            $.0010.
percent.
------------------------------------------------------------------------

``(B) In the case of a unit originally placed in service
after 2008 and before 2013, if--

[[Page S10828]]

------------------------------------------------------------------------
The applicable amount is:
``The unit design net thermal    -----------------------------------
efficiency (HHV) is:           For 1st 5 years   For 2d 5 years
of such service   of such service
------------------------------------------------------------------------
Not less than 43.6 percent..........       $.0105            $.0090
Less than 43.6 but not less than 42        $.0085            $.0068
percent.
Less than 42 but not less than 40.9        $.0075            $.0055.
percent.
------------------------------------------------------------------------

``(C) In the case of a unit originally placed in service
after 2012 and before 2017, if--

------------------------------------------------------------------------
The applicable amount is:
``The unit design net thermal    -----------------------------------
efficiency (HHV) is:           For 1st 5 years   For 2d 5 years
of such service   of such service
------------------------------------------------------------------------
Not less than 44.2 percent..........       $.0140            $.0115
Less than 44.2 but not less than           $.0120            $.0090.
43.9 percent.
------------------------------------------------------------------------

``(c) Inflation Adjustment.--For calendar years after 2003,
each amount in paragraphs (1) and (2) of subsection (b) shall
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) In general.--Any term used in this section which is
also used in section 45I or 48A shall have the meaning given
such term in such section.
``(2) Applicable rules.--The rules of paragraphs (3), (4),
and (5) of section 45(d) shall apply.''.
(b) Credit Treated as Business Credit.--Section 38(b), as
amended by this Act, is amended by striking ``plus'' at the
end of paragraph (19), by striking the period at the end of
paragraph (20) and inserting ``, plus'', and by adding at the
end the following new paragraph:
``(21) the qualifying advanced clean coal technology
production credit determined under section 45J(a).''.
(c) Transitional Rule.--Section 39(d) (relating to
transitional rules), as amended by this Act, is amended by
adding at the end the following new paragraph:
``(18) No carryback of section 45j credit before effective
date.--No portion of the unused business credit for any
taxable year which is attributable to the qualifying advanced
clean coal technology production credit determined under
section 45J may be carried back to a taxable year ending on
or before the date of the enactment of section 45J.''.
(d) Denial of Double Benefit.--Section 29(d) (relating to
other definitions and special rules) is amended by adding at
the end the following new paragraph:
``(9) Denial of double benefit.--This section shall not
apply with respect to any qualified fuel the production of
which may be taken into account for purposes of determining
the credit under section 45J.''.
(e) Clerical Amendment.--The table of sections for subpart
D of part IV of subchapter A of chapter 1, as amended by this
Act, is amended by adding at the end the following new item:

``Sec. 45J. Credit for production from a qualifying advanced clean coal
technology unit.''.

(f) Effective Date.--The amendments made by this section
shall apply to production after the date of the enactment of
this Act, in taxable years ending after such date.

Subtitle C--Treatment of Persons Not Able To Use Entire Credit

SEC. 2221. TREATMENT OF PERSONS NOT ABLE TO USE ENTIRE
CREDIT.

(a) In General.--Section 45I, as added by this Act, is
amended by adding at the end the following new subsection:
``(f) Treatment of Person Not Able To Use Entire Credit.--
``(1) Allowance of credits.--
``(A) In general.--Any credit allowable under this section,
section 45J, or section 48A with respect to a facility owned
by a person described in subparagraph (B) may be transferred
or used as provided in this subsection, and the determination
as to whether the credit is allowable shall be made without
regard to the tax-exempt status of the person.
``(B) Persons described.--A person is described in this
subparagraph if the person is--
``(i) an organization described in section 501(c)(12)(C)
and exempt from tax under section 501(a),
``(ii) an organization described in section 1381(a)(2)(C),
``(iii) a public utility (as defined in section
136(c)(2)(B)),
``(iv) any State or political subdivision thereof, the
District of Columbia, or any agency or instrumentality of any
of the foregoing,
``(v) any Indian tribal government (within the meaning of
section 7871) or any agency or instrumentality thereof, or
``(vi) the Tennessee Valley Authority.
``(2) Transfer of credit.--
``(A) In general.--A person described in clause (i), (ii),
(iii), (iv), or (v) of paragraph (1)(B) may transfer any
credit to which paragraph (1)(A) applies through an
assignment to any other person not described in paragraph
(1)(B). Such transfer may be revoked only with the consent of
the Secretary.
``(B) Regulations.--The Secretary shall prescribe such
regulations as necessary to insure that any credit described
in subparagraph (A) is claimed once and not reassigned by
such other person.
``(C) Transfer proceeds treated as arising from essential
government function.--Any proceeds derived by a person
described in clause (iii), (iv), or (v) of paragraph (1)(B)
from the transfer of any credit under subparagraph (A) shall
be treated as arising from the exercise of an essential
government function.
``(3) Use of credit as an offset.--Notwithstanding any
other provision of law, in the case of a person described in
clause (i), (ii), or (v) of paragraph (1)(B), any credit to
which paragraph (1)(A) applies may be applied by such person,
to the extent provided by the Secretary of Agriculture, as a
prepayment of any loan, debt, or other obligation the entity
has incurred under subchapter I of chapter 31 of title 7 of
the Rural Electrification Act of 1936 (7 U.S.C. 901 et seq.),
as in effect on the date of the enactment of this section.
``(4) Use by tva.--
``(A) In general.--Notwithstanding any other provision of
law, in the case of a person described in paragraph
(1)(B)(vi), any credit to which paragraph (1)(A) applies may
be applied as a credit against the payments required to be
made in any fiscal year under section 15d(e) of the Tennessee
Valley Authority Act of 1933 (16 U.S.C. 831n-4(e)) as an
annual return on the appropriations investment and an annual
repayment sum.
``(B) Treatment of credits.--The aggregate amount of
credits described in paragraph (1)(A) with respect to such
person shall be treated in the same manner and to the same
extent as if such credits were a payment in cash and shall be
applied first against the annual return on the appropriations
investment.
``(C) Credit carryover.--With respect to any fiscal year,
if the aggregate amount of credits described paragraph (1)(A)
with respect to such person exceeds the aggregate amount of
payment obligations described in subparagraph (A), the excess
amount shall remain available for application as credits
against the amounts of such payment obligations in succeeding
fiscal years in the same manner as described in this
paragraph.
``(5) Credit not income.--Any transfer under paragraph (2)
or use under paragraph (3) of any credit to which paragraph
(1)(A) applies shall not be treated as income for purposes of
section 501(c)(12).
``(6) Treatment of unrelated persons.--For purposes of this
subsection, sales among and between persons described in
clauses (i), (ii), (iii), (iv), and (v) of paragraph (1)(A)
shall be treated as sales between unrelated parties.''.
(b) Effective Date.--The amendment made by this section
shall apply to production after the date of the enactment of
this Act, in taxable years ending after such date.

TITLE XXIII--OIL AND GAS PROVISIONS

SEC. 2301. OIL AND GAS FROM MARGINAL WELLS.

(a) In General.--Subpart D of part IV of subchapter A of
chapter 1 (relating to business credits), as amended by this
Act, is amended by adding at the end the following new
section:

``SEC. 45K. 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 $15 ($1.67 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 2002, 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 `2001'
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
qualified marginal well.
``(2) Limitation on amount of production which may
qualify.--

[[Page S10829]]

``(A) In general.--Crude oil or natural gas produced during
any taxable year from any well shall not be treated as
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.
``(3) Definitions.--
``(A) Qualified marginal well.--The term `qualified
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.
``(d) Other Rules.--
``(1) Production attributable to the taxpayer.--In the case
of a qualified 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 qualified 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.
``(4) Noncompliance with pollution laws.--For purposes of
subsection (c)(3)(A), a marginal well which is not in
compliance with the applicable State and Federal pollution
prevention, control, and permit requirements for any period
of time shall not be considered to be a qualified marginal
well during such period.''.
(b) Credit Treated as Business Credit.--Section 38(b), as
amended by this Act, is amended by striking ``plus'' at the
end of paragraph (20), by striking the period at the end of
paragraph (21) and inserting ``, plus'', and by adding at the
end the following new paragraph:
``(22) the marginal oil and gas well production credit
determined under section 45K(a).''.
(c) No Carryback of Marginal Oil and Gas Well Production
Credit Before Effective Date.--Subsection (d) of section 39,
as amended by this Act, is amended by adding at the end the
following new paragraph:
``(19) No carryback of marginal oil and gas well production
credit before effective date.--No portion of the unused
business credit for any taxable year which is attributable to
the marginal oil and gas well production credit determined
under section 45K may be carried back to a taxable year
ending on or before the date of the enactment of section
45K.''.
(d) Coordination With Section 29.--Section 29(a) is amended
by striking ``There'' and inserting ``At the election of the
taxpayer, there''.
(e) Clerical Amendment.--The table of sections for subpart
D of part IV of subchapter A of chapter 1, as amended by this
Act, is amended by adding at the end the following new item:

``Sec. 45K. Credit for producing oil and gas from marginal wells.''.

(f) Effective Date.--The amendments made by this section
shall apply to production in taxable years beginning after
the date of the enactment of this Act.

SEC. 2302. NATURAL GAS GATHERING LINES TREATED AS 7-YEAR
PROPERTY.

(a) In General.--Subparagraph (C) of section 168(e)(3)
(relating to classification of certain property) is amended
by striking ``and'' at the end of clause (i), by
redesignating clause (ii) as clause (iii), and by inserting
after clause (i) the following new clause:
``(ii) any natural gas gathering line, and''.
(b) Natural Gas Gathering Line.--Subsection (i) of section
168, as amended by this Act, is amended by adding at the end
the following new paragraph:
``(16) Natural gas gathering line.--The term `natural gas
gathering line' means--
``(A) the pipe, equipment, and appurtenances determined to
be a gathering line by the Federal Energy Regulatory
Commission, or
``(B) the pipe, equipment, and appurtenances used to
deliver natural gas from the wellhead or a commonpoint to the
point at which such gas first reaches--
``(i) a gas processing plant,
``(ii) an interconnection with a transmission pipeline
certificated by the Federal Energy Regulatory Commission as
an interstate transmission pipeline,
``(iii) an interconnection with an intrastate transmission
pipeline, or
``(iv) a direct interconnection with a local distribution
company, a gas storage facility, or an industrial
consumer.''.
(c) Alternative System.--The table contained in section
168(g)(3)(B) is amended by inserting after the item relating
to subparagraph (C)(i) the following new item:

``(C)(ii)..........................................................10''

.  (d) Effective Date.--The amendments made by this section
shall apply to property placed in service after the date of
the enactment of this Act, in taxable years ending after such
date.

SEC. 2303. EXPENSING OF CAPITAL COSTS INCURRED IN COMPLYING
WITH ENVIRONMENTAL PROTECTION AGENCY SULFUR
REGULATIONS.

(a) In General.--Part VI of subchapter B of chapter 1
(relating to itemized deductions for individuals and
corporations), as amended by this Act, is amended by
inserting after section 179C the following new section:

``SEC. 179D. DEDUCTION FOR CAPITAL COSTS INCURRED IN
COMPLYING WITH ENVIRONMENTAL PROTECTION AGENCY
SULFUR REGULATIONS.

``(a) Treatment as Expense.--
``(1) In general.--A small business refiner may elect to
treat any qualified capital costs as an expense which is not
chargeable to capital account. Any qualified cost which is so
treated shall be allowed as a deduction for the taxable year
in which the cost is paid or incurred.
``(2) Limitation.--
``(A) In general.--The aggregate costs which may be taken
into account under this subsection for any taxable year may
not exceed the applicable percentage of the qualified capital
costs paid or incurred for the taxable year.
``(B) Applicable percentage.--For purposes of subparagraph
(A)--
``(i) In general.--Except as provided in clause (ii), the
applicable percentage is 75 percent.
``(ii) Reduced percentage.--In the case of a small business
refiner with average daily refinery runs for the period
described in subsection (b)(2) in excess of 155,000 barrels,
the percentage described in clause (i) shall be reduced (not
below zero) by the product of such percentage (before the
application of this clause) and the ratio of such excess to
50,000 barrels.
``(b) Definitions.--For purposes of this section--
``(1) Qualified capital costs.--The term `qualified capital
costs' means any costs which--
``(A) are otherwise chargeable to capital account, and
``(B) are paid or incurred for the purpose of complying
with the Highway Diesel Fuel Sulfur Control Requirement of
the Environmental Protection Agency, as in effect on the date
of the enactment of this section, with respect to a facility
placed in service by the taxpayer before such date.
``(2) Small business refiner.--The term `small business
refiner' means, with respect to any taxable year, a refiner
of crude oil, which, within the refinery operations of the
business, employs not more than 1,500 employees on any day
during such taxable year and whose average daily refinery run
for the 1-year period ending on the date of the enactment of
this section did not exceed 205,000 barrels.
``(c) Coordination With Other Provisions.--Section 280B
shall not apply to amounts which are treated as expenses
under this section.
``(d) Basis Reduction.--For purposes of this title, the
basis of any property shall be reduced by the portion of the
cost of such property taken into account under subsection
(a).
``(e) Controlled Groups.--For purposes of this section, all
persons treated as a single employer under subsection (b),
(c), (m), or (o) of section 414 shall be treated as a single
employer.''.
(b) Conforming Amendments.--
(1) Section 263(a)(1), as amended by this Act, is amended
by striking ``or'' at the end of subparagraph (I), by
striking the period at the end of subparagraph (J) and
inserting ``, or'', and by inserting after subparagraph (J)
the following new subparagraph:
``(K) expenditures for which a deduction is allowed under
section 179D.''.
(2) Section 263A(c)(3) is amended by inserting ``179C,''
after ``section''.
(3) Section 312(k)(3)(B), as amended by this Act, is
amended by striking ``or 179C'' each place it appears in the
heading and text and inserting ``, 179C, or 179D''.
(4) Section 1016(a), as amended by this Act, is amended by
striking ``and'' at the end of paragraph (33), by striking
the period at the end of paragraph (34) and inserting ``,
and'', and by adding at the end the following new paragraph:
``(35) to the extent provided in section 179D(d).''.
(5) Section 1245(a), as amended by this Act, is amended by
inserting ``179D,'' after ``179C,'' both places it appears in
paragraphs (2)(C) and (3)(C).
(6) The table of sections for part VI of subchapter B of
chapter 1, as amended by this Act, is amended by inserting
after section 179C the following new item:

``Sec. 179D. Deduction for capital costs incurred in complying with
Environmental Protection Agency sulfur regulations.''.

(c) Effective Date.--The amendment made by this section
shall apply to expenses paid or incurred after the date of
the enactment of this Act, in taxable years ending after such
date.

[[Page S10830]]

SEC. 2304. ENVIRONMENTAL TAX CREDIT.

(a) In General.--Subpart D of part IV of subchapter A of
chapter 1 (relating to business-related credits), as amended
by this Act, is amended by adding at the end the following
new section:

``SEC. 45L. ENVIRONMENTAL TAX CREDIT.

``(a) In General.--For purposes of section 38, the amount
of the environmental tax credit determined under this section
with respect to any small business refiner for any taxable
year is an amount equal to 5 cents for every gallon of 15
parts per million or less sulfur diesel produced at a
facility by such small business refiner during such taxable
year.
``(b) Maximum Credit.--
``(1) In general.--For any small business refiner, the
aggregate amount determined under subsection (a) for any
taxable year with respect to any facility shall not exceed
the applicable percentage of the qualified capital costs paid
or incurred by such small business refiner with respect to
such facility during the applicable period, reduced by the
credit allowed under subsection (a) for any preceding year.
``(2) Applicable percentage.--For purposes of paragraph
(1)--
``(A) In general.--Except as provided in subparagraph (B),
the applicable percentage is 25 percent.
``(B) Reduced percentage.--The percentage described in
subparagraph (A) shall be reduced in the same manner as under
section 179D(a)(2)(B)(ii).
``(c) Definitions.--For purposes of this section--
``(1) In general.--The terms `small business refiner' and
`qualified capital costs' have the same meaning as given in
section 179D.
``(2) Applicable period.--The term `applicable period'
means, with respect to any facility, the period beginning on
the day after the date which is 1 year after the date of the
enactment of this section and ending with the date which is 1
year after the date on which the taxpayer must comply with
the applicable EPA regulations with respect to such facility.
``(3) Applicable epa regulations.--The term `applicable EPA
regulations' means the Highway Diesel Fuel Sulfur Control
Requirements of the Environmental Protection Agency, as in
effect on the date of the enactment of this section.
``(d) Certification.--
``(1) Required.--Not later than the date which is 30 months
after the first day of the first taxable year in which the
environmental tax credit is allowed with respect to qualified
capital costs paid or incurred with respect to a facility,
the small business refiner shall obtain a certification from
the Secretary, in consultation with the Administrator of the
Environmental Protection Agency, that the taxpayer's
qualified capital costs with respect to such facility will
result in compliance with the applicable EPA regulations.
``(2) Contents of application.--An application for
certification shall include relevant information regarding
unit capacities and operating characteristics sufficient for
the Secretary, in consultation with the Administrator of the
Environmental Protection Agency, to determine that such
qualified capital costs are necessary for compliance with the
applicable EPA regulations.
``(3) Review period.--Any application shall be reviewed and
notice of certification, if applicable, shall be made within
60 days of receipt of such application. In the event the
Secretary does not notify the taxpayer of the results of such
certification within such period, the taxpayer may presume
the certification to be issued until so notified.
``(4) Statute of limitations.--With respect to the credit
allowed under this section--
``(A) the statutory period for the assessment of any
deficiency attributable to such credit shall not expire
before the end of the 3-year period ending on the date that
the review period described in paragraph (3) ends, and
``(B) such deficiency may be assessed before the expiration
of such 3-year period notwithstanding the provisions of any
other law or rule of law which would otherwise prevent such
assessment.
``(e) Controlled Groups.--For purposes of this section, all
persons treated as a single employer under subsection (b),
(c), (m), or (o) of section 414 shall be treated as a single
employer.
``(f) Cooperative Organizations.--
``(1) Apportionment of credit.--In the case of a
cooperative organization described in section 1381(a), any
portion of the credit determined under subsection (a) of this
section, for the taxable year may, at the election of the
organization, be apportioned among patrons eligible to share
in patronage dividends on the basis of the quantity or value
of business done with or for such patrons for the taxable
year. Such an election shall be irrevocable for such taxable
year.
``(2) Treatment of organizations and patrons.--
``(A) Organizations.--The amount of the credit not
apportioned to patrons pursuant to paragraph (1) shall be
included in the amount determined under subsection (a) for
the taxable year of the organization.
``(B) Patrons.--The amount of the credit apportioned to
patrons pursuant to paragraph (1) shall be included in the
amount determined under subsection (a) for the first taxable
year of each patron ending on or after the last day of the
payment period (as defined in section 1382(d)) for the
taxable year of the organization or, if earlier, for the
taxable year of each patron ending on or after the date on
which the patron receives notice from the cooperative of the
apportionment.''.
(b) Credit Made Part of General Business Credit.--
Subsection (b) of section 38 (relating to general business
credit), as amended by this Act, is amended by striking
``plus'' at the end of paragraph (21), by striking the period
at the end of paragraph (22) and inserting ``, plus'', and by
adding at the end the following new paragraph:
``(23) in the case of a small business refiner, the
environmental tax credit determined under section 45L(a).''.
(c) Denial of Double Benefit.--Section 280C (relating to
certain expenses for which credits are allowable), as amended
by this Act, is amended by adding after subsection (d) the
following new subsection:
``(e) Environmental Tax Credit.--No deduction shall be
allowed for that portion of the expenses otherwise allowable
as a deduction for the taxable year which is equal to the
amount of the credit determined for the taxable year under
section 45L(a).''.
(d) Clerical Amendment.--The table of sections for subpart
D of part IV of subchapter A of chapter 1, as amended by this
Act, is amended by adding at the end the following new item:

``Sec. 45L. Environmental tax credit.''.

(e) Effective Date.--The amendments made by this section
shall apply to expenses paid or incurred after the date of
the enactment of this Act, in taxable years ending after such
date.

SEC. 2305. DETERMINATION OF SMALL REFINER EXCEPTION TO OIL
DEPLETION DEDUCTION.

(a) In General.--Paragraph (4) of section 613A(d) (relating
to certain refiners excluded) is amended to read as follows:
``(4) Certain refiners excluded.--If the taxpayer or 1 or
more related persons engages in the refining of crude oil,
subsection (c) shall not apply to the taxpayer for a taxable
year if the average daily refinery runs of the taxpayer and
such persons for the taxable year exceed 60,000 barrels. For
purposes of this paragraph, the average daily refinery runs
for any taxable year shall be determined by dividing the
aggregate refinery runs for the taxable year by the number of
days in the taxable year.''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after December 31,
2002.

SEC. 2306. MARGINAL PRODUCTION INCOME LIMIT EXTENSION.

Section 613A(c)(6)(H) (relating to temporary suspension of
taxable income limit with respect to marginal production), as
amended by section 607(a) of the Job Creation and Worker
Assistance Act of 2002, is amended by striking ``2004'' and
inserting ``2007''.

SEC. 2307. AMORTIZATION OF GEOLOGICAL AND GEOPHYSICAL
EXPENDITURES.

(a) In General.--Part VI of subchapter B of chapter 1, as
amended by this Act, is amended by adding at the end the
following new section:

``SEC. 199. AMORTIZATION OF GEOLOGICAL AND GEOPHYSICAL
EXPENDITURES FOR DOMESTIC OIL AND GAS WELLS.

``A taxpayer shall be entitled to an amortization deduction
with respect to any 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) based on a period of 24 months
beginning with the month in which such expenses were
incurred.''.
(b) Clerical Amendment.--The table of sections for part VI
of subchapter B of chapter 1, as amended by this Act, is
amended by adding at the end the following new item:

``Sec. 199. Amortization of geological and geophysical expenditures for
domestic oil and gas wells.''.

(c) Effective Date.--The amendments made by this section
shall apply to costs paid or incurred in taxable years
beginning after December 31, 2002.

SEC. 2308. AMORTIZATION OF DELAY RENTAL PAYMENTS.

(a) In General.--Part VI of subchapter B of chapter 1, as
amended by this Act, is amended by adding at the end the
following new section:

``SEC. 199A. AMORTIZATION OF DELAY RENTAL PAYMENTS FOR
DOMESTIC OIL AND GAS WELLS.

``(a) In General.--A taxpayer shall be entitled to an
amortization deduction with respect to any delay rental
payments incurred in connection with the development of oil
or gas within the United States (as defined in section 638)
based on a period of 24 months beginning with the month in
which such payments were incurred.''.
``(b) Delay rental payments.--For purposes of this section,
the term `delay rental payment' means an amount paid for the
privilege of deferring development of an oil or gas well
under an oil or gas lease.''.
(b) Clerical Amendment.--The table of sections for part VI
of subchapter B of chapter 1, as amended by this Act, is
amended by adding at the end the following new item:

``Sec. 199A. Amortization of delay rental payments for domestic oil and
gas wells.''.

(c) Effective Date.--The amendments made by this section
shall apply to amounts paid or incurred in taxable years
beginning after December 31, 2002.

SEC. 2309. STUDY OF COAL BED METHANE.

(a) In General.--The Secretary of the Treasury shall study
the effect of section 29 of the Internal Revenue Code of 1986
on the production of coal bed methane. Such study shall be
made in conjunction with the study to be undertaken by the
Secretary of the Interior on the effects of coal bed methane
production on surface and water resources, as provided in
section 607 of the Energy Policy Act of 2003.
(b) Contents of Study.--The study under subsection (a)
shall estimate the total amount of credits under section 29
of the Internal Revenue Code of 1986 claimed annually and in
the aggregate which are related to the production of coal bed
methane since the date of the enactment of

[[Page S10831]]

such section 29. Such study shall report the annual value of
such credits allowable for coal bed methane compared to the
average annual wellhead price of natural gas (per thousand
cubic feet of natural gas). Such study shall also estimate
the incremental increase in production of coal bed methane
that has resulted from the enactment of such section 29, and
the cost to the Federal Government, in terms of the net tax
benefits claimed, per thousand cubic feet of incremental coal
bed methane produced annually and in the aggregate since such
enactment.

SEC. 2310. EXTENSION AND MODIFICATION OF CREDIT FOR PRODUCING
FUEL FROM A NONCONVENTIONAL SOURCE.

(a) In General.--Section 29 is amended by adding at the end
the following new subsection:
``(h) Extension for Other Facilities.--
``(1) Oil and gas.--In the case of a well or facility for
producing qualified fuels described in subparagraph (A) or
(B) of subsection (c)(1) which was drilled or placed in
service after the date of the enactment of this subsection
and before January 1, 2005, notwithstanding subsection (f),
this section shall apply with respect to such fuels produced
at such well or facility not later than the close of the 3-
year period beginning on the date that such well is drilled
or such facility is placed in service.
``(2) Facilities producing refined coal.--
``(A) In general.--In the case of a facility described in
subparagraph (C) for producing refined coal which was placed
in service after the date of the enactment of this subsection
and before January 1, 2007, this section shall apply with
respect to fuel produced at such facility not later than the
close of the 5-year period beginning on the date such
facility is placed in service.
``(B) Refined coal.--For purposes of this paragraph, the
term `refined coal' means a fuel which is a liquid, gaseous,
or solid synthetic fuel produced from coal (including
lignite) or high carbon fly ash, including such fuel used as
a feedstock.
``(C) Covered facilities.--
``(i) In general.--A facility is described in this
subparagraph if such facility produces refined coal using a
technology that results in--

``(I) a qualified emission reduction, and
``(II) a qualified enhanced value.

``(ii) Qualified emission reduction.--For purposes of this
subparagraph, the term `qualified emission reduction' means a
reduction of at least 20 percent of the emissions of nitrogen
oxide and either sulfur dioxide or mercury released when
burning the refined coal (excluding any dilution caused by
materials combined or added during the production process),
as compared to the emissions released when burning the
feedstock coal or comparable coal predominantly available in
the marketplace as of January 1, 2002.
``(iii) Qualified enhanced value.--For purposes of this
subparagraph, the term `qualified enhanced value' means an
increase of at least 50 percent in the market value of the
refined coal (excluding any increase caused by materials
combined or added during the production process), as compared
to the value of the feedstock coal.
``(iv) Qualifying advanced clean coal technology facilities
excluded.--A facility described in this subparagraph shall
not include a qualifying advanced clean coal technology
facility (as defined in section 48A(b)).
``(3) Wells producing viscous oil.--
``(A) In general.--In the case of a well for producing
viscous oil which was placed in service after the date of the
enactment of this subsection and before January 1, 2005, this
section shall apply with respect to fuel produced at such
well not later than the close of the 3-year period beginning
on the date such well is placed in service.
``(B) Viscous oil.--The term ``viscous oil' means heavy
oil, as defined in section 613A(c)(6), except that--
``(i) `22 degrees' shall be substituted for `20 degrees' in
applying subparagraph (F) thereof, and
``(ii) in all cases, the oil gravity shall be measured from
the initial well-head samples, drill cuttings, or down hole
samples.
``(C) Waiver of unrelated person requirement.--In the case
of viscous oil, the requirement under subsection (a)(1)(B)(i)
of a sale to an unrelated person shall not apply to any sale
to the extent that the viscous oil is not consumed in the
immediate vicinity of the wellhead.
``(4) Coalmine methane gas.--
``(A) In general.--This section shall apply to coalmine
methane gas--
``(i) captured or extracted by the taxpayer after the date
of the enactment of this subsection and before January 1,
2005, and
``(ii) utilized as a fuel source or sold by or on behalf of
the taxpayer to an unrelated person after the date of the
enactment of this subsection and before January 1, 2005.
``(B) Coalmine methane gas.--For purposes of this
paragraph, the term `coalmine methane gas' means any methane
gas which is--
``(i) liberated during qualified coal mining operations, or
``(ii) extracted up to 5 years in advance of qualified coal
mining operations as part of a specific plan to mine a coal
deposit.
``(C) Special rule for advanced extraction.--In the case of
coalmine methane gas which is captured in advance of
qualified coal mining operations, the credit under subsection
(a) shall be allowed only after the date the coal extraction
occurs in the immediate area where the coalmine methane gas
was removed.
``(D) Noncompliance with pollution laws.--For purposes of
subparagraphs (B) and (C), coal mining operations which are
not in compliance with the applicable State and Federal
pollution prevention, control, and permit requirements for
any period of time shall not be considered to be qualified
coal mining operations during such period.
``(5) Facilities producing fuels from agricultural and
animal waste.--
``(A) In general.--In the case of facility for producing
liquid, gaseous, or solid fuels from qualified agricultural
and animal wastes, including such fuels when used as
feedstocks, which was placed in service after the date of the
enactment of this subsection and before January 1, 2005, this
section shall apply with respect to fuel produced at such
facility not later than the close of the 3-year period
beginning on the date such facility is placed in service.
``(B) Qualified agricultural and animal waste.--For
purposes of this paragraph, the term `qualified agricultural
and animal waste' means agriculture and animal waste,
including by-products, packaging, and any materials
associated with the processing, feeding, selling,
transporting, or disposal of agricultural or animal products
or wastes, including wood shavings, straw, rice hulls, and
other bedding for the disposition of manure.
``(6) Credit amount.--In determining the amount of credit
allowable under this section solely by reason of this
subsection, the dollar amount applicable under subsection
(a)(1) shall be $3 (without regard to subsection (b)(2)).''.
(b) Extension for certain fuel produced at existing
facilities.--Paragraph (2) of section 29(f) (relating to
application of section) is amended by inserting ``(January 1,
2005, in the case of any coke, coke gas, or natural gas and
byproducts produced by coal gasification from lignite in a
facility described in paragraph (1)(B))'' after ``January 1,
2003''.
(c) Effective Date.--The amendment made by this section
shall apply to fuel sold after the date of the enactment of
this Act.

SEC. 2311. NATURAL GAS DISTRIBUTION LINES TREATED AS 15-YEAR
PROPERTY.

(a) In General.--Subparagraph (E) of section 168(e)(3)
(relating to classification of certain property) is amended
by striking ``and'' at the end of clause (ii), by striking
the period at the end of clause (iii) and by inserting ``,
and'', and by adding at the end the following new clause:
``(iv) any natural gas distribution line.''.
(b) Alternative System.--The table contained in section
168(g)(3)(B), as amended by this Act, is amended by adding
after the item relating to subparagraph (E)(iii) the
following new item:

``(E)(iv).........................................................20''.

(c) Effective Date.--The amendments made by this section
shall apply to property placed in service after the date of
the enactment of this Act, in taxable years ending after such
date.

TITLE XXIV--ELECTRIC UTILITY RESTRUCTURING PROVISIONS

SEC. 2401. ONGOING STUDY AND REPORTS REGARDING TAX ISSUES
RESULTING FROM FUTURE RESTRUCTURING DECISIONS.

(a) Ongoing Study.--The Secretary of the Treasury, after
consultation with the Federal Energy Regulatory Commission,
shall undertake an ongoing study of Federal tax issues
resulting from nontax decisions on the restructuring of the
electric industry. In particular, the study shall focus on
the effect on tax-exempt bonding authority of public power
entities and on corporate restructuring which results from
the restructuring of the electric industry.
(b) Regulatory Relief.--In connection with the study
described in subsection (a), the Secretary of the Treasury
should exercise the Secretary's authority, as appropriate, to
modify or suspend regulations that may impede an electric
utility company's ability to reorganize its capital stock
structure to respond to a competitive marketplace.
(c) Reports.--The Secretary of the Treasury shall report to
the Committee on Finance of the Senate and the Committee on
Ways and Means of the House of Representatives not later than
December 31, 2002, regarding Federal tax issues identified
under the study described in subsection (a), and at least
annually thereafter, regarding such issues identified since
the preceding report. Such reports shall also include such
legislative recommendations regarding changes to the private
business use rules under subpart A of part IV of subchapter B
of chapter 1 of the Internal Revenue Code of 1986 as the
Secretary of the Treasury deems necessary. The reports shall
continue until such time as the Federal Energy Regulatory
Commission has completed the restructuring of the electric
industry.

SEC. 2402. MODIFICATIONS TO SPECIAL RULES FOR NUCLEAR
DECOMMISSIONING COSTS.

(a) Repeal of Limitation on Deposits Into Fund Based on
Cost of Service; Contributions After Funding Period.--
Subsection (b) of section 468A is amended to read as follows:
``(b) Limitation on Amounts Paid Into Fund.--The amount
which a taxpayer may pay into the Fund for any taxable year
shall not exceed the ruling amount applicable to such taxable
year.''.
(b) Clarification of Treatment of Fund Transfers.--
Subsection (e) of section 468A is amended by adding at the
end the following new paragraph:
``(8) Treatment of fund transfers.--If, in connection with
the transfer of the taxpayer's interest in a nuclear power
plant, the taxpayer transfers the Fund with respect to such
power plant to the transferee of such interest and the
transferee elects to continue the application of this section
to such Fund--
``(A) the transfer of such Fund shall not cause such Fund
to be disqualified from the application of this section, and
``(B) no amount shall be treated as distributed from such
Fund, or be includible in gross income, by reason of such
transfer.''.
(c) Deduction for Nuclear Decommissioning Costs When
Paid.--Paragraph (2) of section 468A(c) is amended to read as
follows:

[[Page S10832]]

``(2) Deduction of nuclear decommissioning costs.--In
addition to any deduction under subsection (a), nuclear
decommissioning costs paid or incurred by the taxpayer during
any taxable year shall constitute ordinary and necessary
expenses in carrying on a trade or business under section
162.''.
(d) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2002.

SEC. 2403. TREATMENT OF CERTAIN INCOME OF COOPERATIVES.

(a) Income From Open Access and Nuclear Decommissioning
Transactions.--
(1) In general.--Subparagraph (C) of section 501(c)(12) is
amended by striking ``or'' at the end of clause (i), by
striking clause (ii), and by adding at the end the following
new clauses:
``(ii) from any open access transaction (other than income
received or accrued directly or indirectly from a member),
``(iii) from any nuclear decommissioning transaction,
``(iv) from any asset exchange or conversion transaction,
or
``(v) from the prepayment of any loan, debt, or obligation
made, insured, or guaranteed under the Rural Electrification
Act of 1936.''.
(2) Definitions and special rules.--Paragraph (12) of
section 501(c) is amended by adding at the end the following
new subparagraphs:
``(E) For purposes of subparagraph (C)(ii)--
``(i) The term `open access transaction' means any
transaction meeting the open access requirements of any of
the following subclauses with respect to a mutual or
cooperative electric company:

``(I) The provision or sale of transmission service or
ancillary services meets the open access requirements of this
subclause only if such services are provided on a
nondiscriminatory open access basis pursuant to an open
access transmission tariff filed with and approved by FERC,
including an acceptable reciprocity tariff, or under a
regional transmission organization agreement approved by
FERC.
``(II) The provision or sale of electric energy
distribution services or ancillary services meets the open
access requirements of this subclause only if such services
are provided on a nondiscriminatory open access basis to end-
users served by distribution facilities owned by the mutual
or cooperative electric company (or its members).
``(III) The delivery or sale of electric energy generated
by a generation facility meets the open access requirements
of this subclause only if such facility is directly connected
to distribution facilities owned by the mutual or cooperative
electric company (or its members) which owns the generation
facility, and such distribution facilities meet the open
access requirements of subclause (II).

``(ii) Clause (i)(I) shall apply in the case of a
voluntarily filed tariff only if the mutual or cooperative
electric company files a report with FERC within 90 days
after the date of the enactment of this subparagraph relating
to whether or not such company will join a regional
transmission organization.
``(iii) A mutual or cooperative electric company shall be
treated as meeting the open access requirements of clause
(i)(I) if a regional transmission organization controls the
transmission facilities.
``(iv) References to FERC in this subparagraph shall be
treated as including references to the Public Utility
Commission of Texas with respect to any ERCOT utility (as
defined in section 212(k)(2)(B) of the Federal Power Act (16
U.S.C. 824k(k)(2)(B))) or references to the Rural Utilities
Service with respect to any other facility not subject to
FERC jurisdiction.
``(v) For purposes of this subparagraph--

``(I) The term `transmission facility' means an electric
output facility (other than a generation facility) that
operates at an electric voltage of 69 kV or greater. To the
extent provided in regulations, such term includes any output
facility that FERC determines is a transmission facility
under standards applied by FERC under the Federal Power Act
(as in effect on the date of the enactment of the Energy Tax
Incentives Act of 2003).
``(II) The term `regional transmission organization'
includes an independent system operator.
``(III) The term `FERC' means the Federal Energy Regulatory
Commission.

``(F) The term `nuclear decommissioning transaction'
means--
``(i) any transfer into a trust, fund, or instrument
established to pay any nuclear decommissioning costs if the
transfer is in connection with the transfer of the mutual or
cooperative electric company's interest in a nuclear power
plant or nuclear power plant unit,
``(ii) any distribution from any trust, fund, or instrument
established to pay any nuclear decommissioning costs, or
``(iii) any earnings from any trust, fund, or instrument
established to pay any nuclear decommissioning costs.
``(G) The term `asset exchange or conversion transaction'
means any voluntary exchange or involuntary conversion of any
property related to generating, transmitting, distributing,
or selling electric energy by a mutual or cooperative
electric company, the gain from which qualifies for deferred
recognition under section 1031 or 1033, but only if the
replacement property acquired by such company pursuant to
such section constitutes property which is used, or to be
used, for--
``(i) generating, transmitting, distributing, or selling
electric energy, or
``(ii) producing, transmitting, distributing, or selling
natural gas.''.
(b) Treatment of Income From Load Loss Transactions.--
Paragraph (12) of section 501(c), as amended by subsection
(a)(2), is amended by adding after subparagraph (G) the
following new subparagraph:
``(H)(i) In the case of a mutual or cooperative electric
company described in this paragraph or an organization
described in section 1381(a)(2)(C), income received or
accrued from a load loss transaction shall be treated as an
amount collected from members for the sole purpose of meeting
losses and expenses.
``(ii) For purposes of clause (i), the term `load loss
transaction' means any wholesale or retail sale of electric
energy (other than to members) to the extent that the
aggregate sales during the recovery period does not exceed
the load loss mitigation sales limit for such period.
``(iii) For purposes of clause (ii), the load loss
mitigation sales limit for the recovery period is the sum of
the annual load losses for each year of such period.
``(iv) For purposes of clause (iii), a mutual or
cooperative electric company's annual load loss for each year
of the recovery period is the amount (if any) by which--
``(I) the megawatt hours of electric energy sold during
such year to members of such electric company are less than
``(II) the megawatt hours of electric energy sold during
the base year to such members.
``(v) For purposes of clause (iv)(II), the term `base year'
means--
``(I) the calendar year preceding the start-up year, or
``(II) at the election of the electric company, the second
or third calendar years preceding the start-up year.
``(vi) For purposes of this subparagraph, the recovery
period is the 7-year period beginning with the start-up year.
``(vii) For purposes of this subparagraph, the start-up
year is the calendar year which includes the date of the
enactment of this subparagraph or, if later, at the election
of the mutual or cooperative electric company--
``(I) the first year that such electric company offers
nondiscriminatory open access, or
``(II) the first year in which at least 10 percent of such
electric company's sales are not to members of such electric
company.
``(viii) A company shall not fail to be treated as a mutual
or cooperative company for purposes of this paragraph or as a
corporation operating on a cooperative basis for purposes of
section 1381(a)(2)(C) by reason of the treatment under clause
(i).
``(ix) In the case of a mutual or cooperative electric
company, income from any open access transaction received, or
accrued, indirectly from a member shall be treated as an
amount collected from members for the sole purpose of meeting
losses and expenses.''.
(c) Exception From Unrelated Business Taxable Income.--
Subsection (b) of section 512 (relating to modifications) is
amended by adding at the end the following new paragraph:
``(18) Treatment of mutual or cooperative electric
companies.--In the case of a mutual or cooperative electric
company described in section 501(c)(12), there shall be
excluded income which is treated as member income under
subparagraph (H) thereof.''.
(d) Cross Reference.--Section 1381 is amended by adding at
the end the following new subsection:
``(c) Cross Reference.--

``For treatment of income from load loss transactions of
organizations described in subsection (a)(2)(C), see section
501(c)(12)(H).''.
(e) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after the date of the
enactment of this Act.

SEC. 2404. SALES OR DISPOSITIONS TO IMPLEMENT FEDERAL ENERGY
REGULATORY COMMISSION OR STATE ELECTRIC
RESTRUCTURING POLICY.

(a) In General.--Section 451 (relating to general rule for
taxable year of inclusion) is amended by adding at the end
the following new subsection:
``(i) Special Rule for Sales or Dispositions To Implement
Federal Energy Regulatory Commission or State Electric
Restructuring Policy.--
``(1) In general.--For purposes of this subtitle, if a
taxpayer elects the application of this subsection to a
qualifying electric transmission transaction in any taxable
year--
``(A) any ordinary income derived from such transaction
which would be required to be recognized under section 1245
or 1250 for such taxable year (determined without regard to
this subsection), and
``(B) any income derived from such transaction in excess of
such ordinary income which is required to be included in
gross income for such taxable year,

shall be so recognized and included ratably over the 8-
taxable year period beginning with such taxable year.
``(2) Qualifying electric transmission transaction.--For
purposes of this subsection, the term `qualifying electric
transmission transaction' means any sale or other disposition
before January 1, 2007, of--
``(A) property used by the taxpayer in the trade or
business of providing electric transmission services, or
``(B) any stock or partnership interest in a corporation or
partnership, as the case may be, whose principal trade or
business consists of providing electric transmission
services,

but only if such sale or disposition is to an independent
transmission company.
``(3) Independent transmission company.--For purposes of
this subsection, the term `independent transmission company'
means--
``(A) a regional transmission organization approved by the
Federal Energy Regulatory Commission,
``(B) a person--
``(i) who the Federal Energy Regulatory Commission
determines in its authorization of the

[[Page S10833]]

transaction under section 203 of the Federal Power Act (16
U.S.C. 824b) is not a market participant within the meaning
of such Commission's rules applicable to regional
transmission organizations, and
``(ii) whose transmission facilities to which the election
under this subsection applies are under the operational
control of a Federal Energy Regulatory Commission-approved
regional transmission organization before the close of the
period specified in such authorization, but not later than
the close of the period applicable under paragraph (1), or
``(C) in the case of facilities subject to the exclusive
jurisdiction of the Public Utility Commission of Texas, a
person which is approved by that Commission as consistent
with Texas State law regarding an independent transmission
organization.
``(4) Election.--An election under paragraph (1), once
made, shall be irrevocable.
``(5) Nonapplication of installment sales treatment.--
Section 453 shall not apply to any qualifying electric
transmission transaction with respect to which an election to
apply this subsection is made.''.
(b) Effective Date.--The amendment made by this section
shall apply to transactions occurring after the date of the
enactment of this Act.

SEC. 2405. APPLICATION OF TEMPORARY REGULATIONS TO CERTAIN
OUTPUT CONTRACTS.

In the application of section 1-141-7(c)(4) of the Treasury
Temporary Regulations to output contracts entered into after
February 22, 1998, with respect to an issuer participating in
open access with respect to the issuer's transmission
facilities, an output contract in existence on or before such
date that is amended after such date shall be treated as a
contract entered into after such date only if the amendment
increases the amount of output sold under such contract by
extending the term of the contract or increasing the amount
of output sold, but such treatment as a contract entered into
after such date shall begin on the effective date of the
amendment and shall apply only with respect to the increased
output to be provided under such contract.

SEC. 2406. TREATMENT OF CERTAIN DEVELOPMENT INCOME OF
COOPERATIVES.

(a) In General.--Subparagraph (C) of section 501(c)(12), as
amended by this Act, is amended by striking ``or'' at the end
of clause (iv), by striking the period at the end of clause
(v) and insert ``, or'', and by adding at the end the
following new clause:
``(vi) from the receipt before January 1, 2007, of any
money, property, capital, or any other contribution in aid of
construction or connection charge intended to facilitate the
provision of electric service for the purpose of developing
qualified fuels from nonconventional sources (within the
meaning of section 29).''.
(b) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after the date of the
enactment of this Act.

TITLE XXV--ADDITIONAL PROVISIONS

SEC. 2501. EXTENSION OF ACCELERATED DEPRECIATION AND WAGE
CREDIT BENEFITS ON INDIAN RESERVATIONS.

(a) Special Recovery Period for Property on Indian
Reservations.--Section 168(j)(8) (relating to termination),
as amended by section 613(b) of the Job Creation and Worker
Assistance Act of 2002, is amended by striking ``2004'' and
inserting ``2005''.
(b) Indian Employment Credit.--Section 45A(f) (relating to
termination), as amended by section 613(a) of the Job
Creation and Worker Assistance Act of 2002, is amended by
striking ``2004'' and inserting ``2005''.

SEC. 2502. STUDY OF EFFECTIVENESS OF CERTAIN PROVISIONS BY
GAO.

(a) Study.--The Comptroller General of the United States
shall undertake an ongoing analysis of--
(1) the effectiveness of the alternative motor vehicles and
fuel incentives provisions under title II and the
conservation and energy efficiency provisions under title
III, and
(2) the recipients of the tax benefits contained in such
provisions, including an identification of such recipients by
income and other appropriate measurements.

Such analysis shall quantify the effectiveness of such
provisions by examining and comparing the Federal
Government's forgone revenue to the aggregate amount of
energy actually conserved and tangible environmental benefits
gained as a result of such provisions.
(b) Reports.--The Comptroller General of the United States
shall report the analysis required under subsection (a) to
Congress not later than December 31, 2002, and annually
thereafter.

SEC. 2503. CREDIT FOR PRODUCTION OF ALASKA NATURAL GAS.

(a) In General.--Subpart D of part IV of subchapter A of
chapter 1 (relating to business related credits), as amended
by this Act, is amended by adding at the end the following
new section:

``SEC. 45M. ALASKA NATURAL GAS.

``(a) In General.--For purposes of section 38, the Alaska
natural gas credit of any taxpayer for any taxable year is
the credit amount per 1,000,000 Btu of Alaska natural gas
entering any intake or tie-in point which was derived from an
area of the State of Alaska lying north of 64 degrees North
latitude, which is attributable to the taxpayer and sold by
or on behalf of the taxpayer to an unrelated person during
such taxable year (within the meaning of section 45).
``(b) Credit Amount.--For purposes of this section--
``(1) In general.--The credit amount per 1,000,000 Btu of
Alaska natural gas entering any intake or tie-in point which
was derived from an area of the State of Alaska lying north
of 64 degrees North latitude (determined in United States
dollars), is the excess of--
``(A) $3.25, over
``(B) the average monthly price at the AECO C Hub in
Alberta, Canada, for Alaska natural gas for the month in
which occurs the date of such entering.
``(2) Inflation adjustment.--In the case of any taxable
year beginning in a calendar year after the first calendar
year ending after the date described in subsection (g)(1),
the dollar amount contained in paragraph (1)(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 `the
calendar year ending before the date described in section
45M(g)(1)' for `1990').
``(c) Alaska Natural Gas.--For purposes of this section,
the term `Alaska natural gas' means natural gas entering any
intake or tie-in point which was derived from an area of the
State of Alaska lying north of 64 degrees North latitude
produced in compliance with the applicable State and Federal
pollution prevention, control, and permit requirements from
the area generally known as the North Slope of Alaska
(including the continental shelf thereof within the meaning
of section 638(l)), determined without regard to the area of
the Alaska National Wildlife Refuge (including the
continental shelf thereof within the meaning of section
638(l)).
``(d) Recapture.--
``(1) In general.--With respect to each 1,000,000 Btu of
Alaska natural gas entering any intake or tie-in point which
was derived from an area of the State of Alaska lying north
of 64 degrees North latitude after the date which is 3 years
after the date described in subsection (g)(1), if the average
monthly price described in subsection (b)(1)(B) exceeds 150
percent of the amount described in subsection (b)(1)(A) for
the month in which occurs the date of such entering, the
taxpayer's tax under this chapter for the taxable year shall
be increased by an amount equal to the lesser of--
``(A) such excess, or
``(B) the aggregate decrease in the credits allowed under
section 38 for all prior taxable years which would have
resulted if the Alaska natural gas credit received by the
taxpayer for such years had been zero.
``(2) Special rules.--
``(A) Tax benefit rule.--The tax for the taxable year shall
be increased under paragraph (1) only with respect to credits
allowed by reason of this section which were used to reduce
tax liability. In the case of credits not so used to reduce
tax liability, the carryforwards and carrybacks under section
39 shall be appropriately adjusted.
``(B) No credits against tax.--Any increase in tax under
this subsection shall not be treated as a tax imposed by this
chapter for purposes of determining the amount of any credit
under this chapter or for purposes of section 55.
``(e) Application of Rules.--For purposes of this section,
rules similar to the rules of paragraphs (3), (4), and (5) of
section 45(d) shall apply.
``(f) No Double Benefit.--The amount of any deduction or
other credit allowable under this chapter for any fuel taken
into account in computing the amount of the credit determined
under subsection (a) shall be reduced by the amount of such
credit attributable to such fuel.
``(g) Application of Section.--This section shall apply to
Alaska natural gas entering any intake or tie-in point which
was derived from an area of the State of Alaska lying north
of 64 degrees North latitude for the period--
``(1) beginning with the later of--
``(A) January 1, 2010, or
``(B) the initial date for the interstate transportation of
such Alaska natural gas, and
``(2) except with respect to subsection (d), ending with
the date which is 15 years after the date described in
paragraph (1).''.
(b) Credit Treated as Business Credit.--Section 38(b), as
amended by this Act, is amended by striking ``plus'' at the
end of paragraph (22), by striking the period at the end of
paragraph (23) and inserting ``, plus'', and by adding at the
end the following new paragraph:
``(24) The Alaska natural gas credit determined under
section 45M(a).''.
(c) Allowing Credit Against Entire Regular Tax and Minimum
Tax.--
(1) In general.--Subsection (c) of section 38 (relating to
limitation based on amount of tax), as amended by this Act,
is amended by redesignating paragraph (5) as paragraph (6)
and by inserting after paragraph (4) the following new
paragraph:
``(5) Special rules for alaska natural gas credit.--
``(A) In general.--In the case of the Alaska natural gas
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) the amounts in subparagraphs (A) and (B) thereof
shall be treated as being zero, 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 Alaska
natural gas credit).

``(B) Alaska Natural Gas Credit.--For purposes of this
subsection, the term `Alaska natural gas credit' means the
credit allowable under subsection (a) by reason of section
45M(a).''.
(2) Conforming amendments.--Subclause (II) of section
38(c)(2)(A)(ii), as amended by this Act, subclause (II) of
section 38(c)(3)(A)(ii), as amended by this Act, and
subclause (II) of section 38(c)(4)(A)(ii), as added by this
Act, are each amended by inserting ``or the Alaska natural
gas credit'' after ``producer credit''.
(d) Clerical Amendment.--The table of sections for subpart
D of part IV of subchapter A

[[Page S10834]]

of chapter 1, as amended by this Act, is amended by adding at
the end the following new item:

``Sec. 45M. Alaska natural gas.''.

SEC. 2504. SALE OF GASOLINE AND DIESEL FUEL AT DUTY-FREE
SALES ENTERPRISES.

(a) Prohibition.--Section 555(b) of the Tariff Act of 1930
(19 U.S.C. 1555(b)) is amended--
(1) by redesignating paragraphs (6) through (8) as
paragraphs (7) through (9), respectively; and
(2) by inserting after paragraph (5) the following:
``(6) Any gasoline or diesel fuel sold at a duty-free sales
enterprise shall be considered to be entered for consumption
into the customs territory of the United States.''.
(b) Construction.--The amendments made by this section
shall not be construed to create any inference with respect
to the interpretation of any provision of law as such
provision was in effect on the day before the date of
enactment of this Act.
(c) Effective date.--The amendments made by this section
shall take effect on the date of enactment of this Act.

SEC. 2505. TREATMENT OF DAIRY PROPERTY.

(a) Qualified Disposition of Dairy Property Treated as
Involuntary Conversion.--
(1) In general.--Section 1033 (relating to involuntary
conversions) is amended by designating subsection (k) as
subsection (l) and inserting after subsection (j) the
following new subsection:
``(k) Qualified Disposition To Implement Bovine
Tuberculosis Eradication Program.--
``(1) In general.--For purposes of this subtitle, if a
taxpayer elects the application of this subsection to a
qualified disposition:
``(A) Treatment as involuntary conversion.--Such
disposition shall be treated as an involuntary conversion to
which this section applies.
``(B) Modification of similar property requirement.--
Property to be held by the taxpayer either for productive use
in a trade or business or for investment shall be treated as
property similar or related in service or use to the property
disposed of.
``(C) Extension of period for replacing property.--
Subsection (a)(2)(B)(i) shall be applied by substituting `4
years' for `2 years'.
``(D) Waiver of unrelated person requirement.--Subsection
(i) (relating to replacement property must be acquired from
unrelated person in certain cases) shall not apply.
``(E) Expanded capital gain for cattle and horses.--Section
1231(b)(3)(A) shall be applied by substituting `1 month' for
`24 months'.
``(2) Qualified disposition.--
``(A) In general.--For purposes of this subsection, the
term `qualified disposition' means the disposition of dairy
property which is certified by the Secretary of Agriculture
as having been the subject of an agreement under the bovine
tuberculosis eradication program, as implemented pursuant to
the Declaration of Emergency Because of Bovine Tuberculosis
(65 Federal Register 63,227 (2000)).
``(B) Payments received in connection with the bovine
tuberculosis eradication program.--For purposes of this
subsection, any amount received by a taxpayer in connection
with an agreement under such bovine tuberculosis eradication
program shall be treated as received in a qualified
disposition.
``(C) Transmittal of certifications.--The Secretary of
Agriculture shall transmit copies of certifications under
this paragraph to the Secretary.
``(3) Allowance of the adjusted basis of certified dairy
property as a depreciation deduction.--The adjusted basis of
any property certified under paragraph (2)(A) shall be
allowed as a depreciation deduction under section 167 for the
taxable year which includes the date of the certification
described in paragraph (2)(A).
``(4) Dairy property.--For purposes of this subsection, the
term `dairy property' means all tangible or intangible
property used in connection with a dairy business or a dairy
processing plant.
``(5) Special rules for certain business organizations.--
``(A) S corporations.--In the case of an S corporation,
gain on a qualified disposition shall not be treated as
recognized for the purposes of section 1374 (relating to tax
imposed on certain built-in gains).
``(B) Partnerships.--In the case of a partnership which
dissolves in anticipation of a qualified disposition
(including in anticipation of receiving the amount described
in paragraph (2)(B)), the dairy property owned by the
partners of such partnership at the time of such disposition
shall be treated, for the purposes of this section and
notwithstanding any regulation or rule of law, as owned by
such partners at the time of such disposition.
``(6) Termination.--This subsection shall not apply to
dispositions made after December 31, 2006.''.
(2) Effective date.--The amendment made by this subsection
shall apply to dispositions made and amounts received in
taxable years ending after May 22, 2001.
(b) Deduction of Qualified Reclamation Expenditures.--
(1) In general.--Part VI of subchapter B of chapter 1
(relating to itemized deductions for individuals and
corporations), as amended by this Act, is amended by adding
at the end the following new section:

``SEC. 199B. EXPENSING OF DAIRY PROPERTY RECLAMATION COSTS.

``(a) In General.--Notwithstanding section 280B (relating
to demolition of structures), a taxpayer may elect to treat
any qualified reclamation expenditure which is paid or
incurred by the taxpayer as an expense which is not
chargeable to capital account. Any expenditure which is so
treated shall be allowed as a deduction for the taxable year
in which it is paid or incurred.
``(b) Qualified Reclamation Expenditure.--
``(1) In general.--For purposes of this subparagraph, the
term `qualified reclamation expenditure' means amounts
otherwise chargeable to capital account and paid or incurred
to convert any real property certified under section
1033(k)(2) (relating to qualified disposition) into
unimproved land.
``(2) Special rule for expenditures for depreciable
property.--A rule similar to the rule of section 198(b)(2)
(relating to special rule for expenditures for depreciable
property) shall apply for purposes of paragraph (1).
``(c) Deduction Recaptured as Ordinary Income.--Rules
similar to the rules of section 198(e) (relating to deduction
recaptured as ordinary income on sale, etc.) shall apply with
respect to any qualified reclamation expenditure.
``(d) Termination.--This section shall not apply to
expenditures paid or incurred after December 31, 2006.''.
(2) Clerical amendment.--The table of sections for part VI
of subchapter B of chapter 1, as amended by this Act, is
amended by adding at the end the following new item:

``Sec. 199B. Expensing of dairy property reclamation costs.''.

(3) Effective date.--The amendments made by this subsection
shall apply to expenditures paid or incurred in taxable years
ending after May 22, 2001.

SEC. 2506. CLARIFICATION OF EXCISE TAX EXEMPTIONS FOR
AGRICULTURAL AERIAL APPLICATORS.

(a) No Waiver by Farm Owner, Tenant, or Operator
Necessary.--Subparagraph (B) of section 6420(c)(4) (relating
to certain farming use other than by owner, etc.) is amended
to read as follows:
``(B) if the person so using the gasoline is an aerial or
other applicator of fertilizers or other substances and is
the ultimate purchaser of the gasoline, then subparagraph (A)
of this paragraph shall not apply and the aerial or other
applicator shall be treated as having used such gasoline on a
farm for farming purposes.''.
(b) Exemption Includes Fuel Used Between Airfield and
Farm.--Section 6420(c)(4), as amended by subsection (a), is
amended by adding at the end the following new flush
sentence:

``For purposes of this paragraph, in the case of an aerial
applicator, gasoline shall be treated as used on a farm for
farming purposes if the gasoline is used for the direct
flight between the airfield and 1 or more farms.''.
(c) Exemption from Tax on Air Transportation of Persons for
Forestry Purposes Extended to Fixed-Wing Aircraft.--
Subsection (f) of section 4261 (relating to tax on air
transportation of persons) is amended to read as follows:
``(f) Exemption for Certain Uses.--No tax shall be imposed
under subsection (a) or (b) on air transportation--
``(1) by helicopter for the purpose of transporting
individuals, equipment, or supplies in the exploration for,
or the development or removal of, hard minerals, oil, or gas,
or
``(2) by helicopter or by fixed-wing aircraft for the
purpose of the planting, cultivation, cutting, or
transportation of, or caring for, trees (including logging
operations),

but only if the helicopter or fixed-wing aircraft does not
take off from, or land at, a facility eligible for assistance
under the Airport and Airway Development Act of 1970, or
otherwise use services provided pursuant to section 44509 or
44913(b) or subchapter I of chapter 471 of title 49, United
States Code, during such use. In the case of helicopter
transportation described in paragraph (1), this subsection
shall be applied by treating each flight segment as a
distinct flight.''.
(d) Effective Date.--The amendments made by this section
shall apply to fuel use or air transportation after December
31, 2001, and before January 1, 2003.

SEC. 2507. MODIFICATION OF RURAL AIRPORT DEFINITION.

(a) In General.--Clause (ii) of section 4261(e)(1)(B)
(defining rural airport) is amended by striking the period at
the end of subclause (II) and inserting ``, or'' and by
adding at the end the following new subclause:

``(III) is not connected by paved roads to another
airport.''.

(b) Effective Date.--The amendments made by this section
shall apply to calendar years beginning after 2002.

SEC. 2508. EXEMPTION FROM TICKET TAXES FOR TRANSPORTATION
PROVIDED BY SEAPLANES.

(a) In General.--The taxes imposed by sections 4261 and
4271 shall not apply to transportation by a seaplane with
respect to any segment consisting of a takeoff from, and a
landing on, water.
(b) Effective Date.--The amendments made by this section
shall apply to calendar years beginning after 2002.

DIVISION I--IRAQ OIL IMPORT RESTRICTION

TITLE XXVI--IRAQ OIL IMPORT RESTRICTION

SEC. 2601. SHORT TITLE AND FINDINGS.

(a) Short Title.--This title can be cited as the ``Iraq
Petroleum Import Restriction Act of 2003''.
(b) Findings.--Congress finds that--
(1) the Government of the Republic of Iraq--
(A) has failed to comply with the terms of United Nations
Security Council Resolution 687 regarding unconditional Iraqi
acceptance of the destruction, removal, or rendering
harmless, under international supervision, of all nuclear,

[[Page S10835]]

chemical and biological weapons and all stocks of agents and
all related subsystems and components and all research,
development, support and manufacturing facilities, as well as
all ballistic missiles with a range greater than 150
kilometers and related major parts, and repair and production
facilities and has failed to allow United Nations inspectors
access to sites used for the production or storage of weapons
of mass destruction;
(B) routinely contravenes the terms and. conditions of UNSC
Resolution 661, authorizing the export of petroleum products
from Iraq in exchange for food, medicine and other
humanitarian products by conducting a routine and extensive
program to sell such products outside of the channels
established by UNSC Resolution 661 in exchange for military
equipment and materials to be used in pursuit of its program
to develop weapons of mass destruction in order to threaten
the United States and its allies in the Persian Gulf and
surrounding regions;
(C) has failed to adequately draw down upon the amounts
received in the Escrow Account established by UNSC Resolution
986 to purchase food, medicine and other humanitarian
products required by its citizens, resulting in massive
humanitarian suffering by the Iraqi people;
(D) conducts a periodic and systematic campaign to harass
and obstruct the enforcement of the United States- and United
Kingdom-enforced ``No-Fly Zones'' in effect in the Republic
of Iraq;
(E) routinely manipulates the petroleum export production
volumes permitted under UNSC Resolution 661 in order to
create uncertainty in global energy markets, and therefore
threatens the economic security of the United States;
(F) pays bounties to the families of suicide bombers in
order to encourage the murder of Israeli civilians;
(2) further imports of petroleum products from the Republic
of Iraq are inconsistent with the national security and
foreign policy interests of the United States and should be
eliminated until such time as they are not so inconsistent.

SEC. 2602. PROHIBITION ON IRAQI-ORIGIN PETROLEUM IMPORTS.

The direct or indirect import from Iraq of Iraqi-origin
petroleum and petroleum products is prohibited,
notwithstanding an authorization by the Committee established
by UNSC Resolution 661 or its designee, or any other order to
the contrary.

SEC. 2603. TERMINATION/PRESIDENTIAL CERTIFICATION.

This title will remain in effect until such time as the
President, after consultation with the relevant committees in
Congress, certifies to the Congress that--
(1) Iraq is in substantial compliance with the terms of--
(A) UNSC Resolution 687; and
(B) UNSC Resolution 986 prohibiting smuggling of oil in
circumvention of the ``Oil-for-Food'' program; and
(2) ceases the practice of compensating the families of
suicide bombers in order to encourage the murder of Israeli
citizens; or that
(3) resuming the importation of Iraqi-origin petroleum and
petroleum products would not be inconsistent with the
national security and foreign policy interests of the United
States.

SEC. 2604. HUMANITARIAN INTERESTS.

It is the sense of the Senate that the President should
make all appropriate efforts to ensure that the humanitarian
needs of the Iraqi people are not negatively affected by this
Act, and should encourage through public, private, domestic
and international means the direct or indirect sale, donation
or other transfer to appropriate nongovernmental health and
humanitarian organizations and individuals within Iraq of
food, medicine and other humanitarian products.

SEC. 2605. DEFINITIONS.

(a) 661 Committee.--The term 661 Committee means the
Security Council Committee established by UNSC Resolution
661, and persons acting for or on behalf of the Committee
under its specific delegation of authority for the relevant
matter or category of activity, including the overseers
appointed by the United Nations Secretary-General to examine
and approve agreements for purchases of petroleum and
petroleum products from the Government of Iraq pursuant to
UNSC Resolution 986.
(b) UNSC Resolution 661.--The term UNSC Resolution 661
means United Nations Security Council Resolution No. 661,
adopted August 6, 1990, prohibiting certain transactions with
respect to Iraq and Kuwait.
(c) UNSC Resolution 687.--The term UNSC Resolution 687
means United Nations Security Council Resolution 687, adopted
April 3, 1991.
(d) UNSC Resolution 986.--The term UNSC Resolution 986
means United Nations Security Council Resolution 986, adopted
April 14, 1995.

SEC. 2606. EFFECTIVE DATE.

The prohibition on importation of Iraqi-origin petroleum
and petroleum products shall be effective 30 days after
enactment of this Act.

DIVISION J--MISCELLANEOUS

TITLE XXVII--MISCELLANEOUS PROVISION

SEC. 2701. FAIR TREATMENT OF PRESIDENTIAL JUDICIAL NOMINEES.

It is the sense of the Senate that, in the interests of
the administration of justice, the Senate Judiciary Committee
should along with its other legislative and oversight
responsibilities, continue to hold regular hearings on
judicial nominees and should, in accordance with the
precedents and practices of the Committee, schedule hearings
on the nominees submitted by the President on May 9, 2001,
and resubmitted on September 5, 2001, expeditiously.
Attest:

Secretary.
______

SA 1538. Mr. SUNUNU (for Mr. Roberts (for himself and Mr.
Rockefeller)) proposed an amendment to the bill H.R. 2417, to authorize
appropriations for fiscal year 2004 for intelligence and intelligence-
related activities of the United States Government, the Community
Management Account, and the Central Intelligence Retirement and
Disability System, and for other purposes; as follows:

On page 14, strike line 4 and all that follows through page
15, line 23.
On page 16, line 6, insert ``, in coordination with the
Secretary of Defense,'' after ``shall''.
On page 18, line 17, strike ``and the Secretary of Defense
shall jointly submit'' and insert ``shall, in coordination
with the Secretary of Defense, submit''.
On page 22, between lines 8 and 9, insert the following:

SEC. 317. BUDGET TREATMENT OF COSTS OF ACQUISITION OF MAJOR
SYSTEMS BY THE INTELLIGENCE COMMUNITY.

(a) Findings.--Congress makes the following findings:
(1) Funds within the National Foreign Intelligence Program
often must be shifted from program to program and from fiscal
year to fiscal year to address funding shortfalls caused by
significant increases in the costs of acquisition of major
systems by the intelligence community.
(2) While some increases in the costs of acquisition of
major systems by the intelligence community are unavoidable,
the magnitude of growth in the costs of acquisition of many
major systems indicates a systemic bias within the
intelligence community to underestimate the costs of such
acquisition, particularly in the preliminary stages of
development and production.
(3) Decisions by Congress to fund the acquisition of major
systems by the intelligence community rely significantly upon
initial estimates of the affordability of acquiring such
major systems and occur within a context in which funds can
be allocated for a variety of alternative programs. Thus,
substantial increases in costs of acquisition of major
systems place significant burdens on the availability of
funds for other programs and new proposals within the
National Foreign Intelligence Program.
(4) Independent cost estimates, prepared by independent
offices, have historically represented a more accurate
projection of the costs of acquisition of major systems.
(5) Recognizing the benefits associated with independent
cost estimates for the acquisition of major systems, the
Secretary of Defense has built upon the statutory requirement
in section 2434 of title 10, United States Code, to develop
and consider independent cost estimates for the acquisition
of such systems by mandating the use of such estimates in
budget requests of the Department of Defense.
(6) The mandatory use throughout the intelligence community
of independent cost estimates for the acquisition of major
systems will assist the President and Congress in the
development and funding of budgets which more accurately
reflect the requirements and priorities of the United States
Government for intelligence and intelligence-related
activities.
(b) Budget Treatment of Costs of Acquisition of Major
Systems.--Title V of the National Security Act of 1947 (50
U.S.C. 413 et seq.) is amended by inserting after section 506
the following new section:

``Budget treatment of costs of acquisition of major systems by the
intelligence community

``Sec. 506A. (a) Independent Cost Estimates.--(1) The
Director of Central Intelligence shall, in consultation with
the head of each element of the intelligence community
concerned, prepare an independent cost estimate of the full
life-cycle cost of development, procurement, and operation of
each major system to be acquired by the intelligence
community.
``(2) Each independent cost estimate for a major system
shall, to the maximum extent practicable, specify the amount
required to be appropriated and obligated to develop,
procure, and operate the major system in each fiscal year of
the proposed period of development, procurement, and
operation of the major system.
``(3)(A) In the case of a program of the intelligence
community that qualifies as a major system, an independent
cost estimate shall be prepared before the submission to
Congress of the budget of the President for the first fiscal
year in which appropriated funds are anticipated to be
obligated for the development or procurement of such major
system.
``(B) In the case of a program of the intelligence
community for which an independent cost estimate was not
previously required to be prepared under this section,
including a program for which development or procurement
commenced before the date of the enactment of the
Intelligence Authorization Act for Fiscal Year 2004, if the
aggregate future costs of development or procurement (or any
combination of such activities) of the program will exceed
$500,000,000 (in current fiscal year dollars), the program
shall qualify as a major system for purposes of this section,
and an independent cost estimate for such major system shall
be prepared before the submission to Congress of the budget
of the President for the first fiscal year thereafter in
which appropriated funds are

[[Page S10836]]

anticipated to be obligated for such major system.
``(4) The independent cost estimate for a major system
shall be updated upon--
``(A) the completion of any preliminary design review
associated with the major system;
``(B) any significant modification to the anticipated
design of the major system; or
``(C) any change in circumstances that renders the current
independent cost estimate for the major system inaccurate.
``(5) Any update of an independent cost estimate for a
major system under paragraph (4) shall meet all requirements
for independent cost estimates under this section, and shall
be treated as the most current independent cost estimate for
the major system until further updated under that paragraph.
``(b) Preparation of Independent Cost Estimates.--(1) The
Director shall establish within the Office of the Deputy
Director of Central Intelligence for Community Management an
office which shall be responsible for preparing independent
cost estimates, and any updates thereof, under subsection
(a), unless a designation is made under paragraph (2).
``(2) In the case of the acquisition of a major system for
an element of the intelligence community within the
Department of Defense, the Director and the Secretary of
Defense shall provide that the independent cost estimate, and
any updates thereof, under subsection (a) be prepared by an
entity jointly designated by the Director and the Secretary
in accordance with section 2434(b)(1)(A) of title 10, United
States Code.
``(c) Utilization in Budgets of President.--If the budget
of the President requests appropriations for any fiscal year
for the development or procurement of a major system by the
intelligence community, the President shall request in such
budget an amount of appropriations for the development or
procurement, as the case may be, of the major system that is
equivalent to the amount of appropriations identified in the
most current independent cost estimate for the major system
for obligation for each fiscal year for which appropriations
are requested for the major system in such budget.
``(d) Inclusion of Estimates in Budget Justification
Materials.--The budget justification materials submitted to
Congress in support of the budget of the President shall
include the most current independent cost estimate under this
section for each major system for which appropriations are
requested in such budget for any fiscal year.
``(e) Definitions.--In this section:
``(1) The term `budget of the President' means the budget
of the President for a fiscal year as submitted to Congress
under section 1105(a) of title 31, United States Code.
``(2) The term `independent cost estimate' means a
pragmatic and neutral analysis, assessment, and
quantification of all costs and risks associated with the
acquisition of a major system, which shall be based on
programmatic and technical specifications provided by the
office within the element of the intelligence community with
primary responsibility for the development, procurement, or
operation of the major system.
``(3) The term `major system' means any significant program
of an element of the intelligence community with projected
total development and procurement costs exceeding
$500,000,000 (in current fiscal year dollars), which costs
shall include all end-to-end program costs, including costs
associated with the development and procurement of the
program and any other costs associated with the development
and procurement of systems required to support or utilize the
program.''.
(c) Clerical Amendment.--The table of contents for the
National Security Act of 1947 is amended by inserting after
the item relating to section 506 the following new item:

``Sec. 506A. Budget treatment of costs of acquisition of major systems
by the intelligence community.''.

On page 27, beginning on line 23, strike ``The heads of the
elements of the intelligence community shall jointly submit''
and insert ``The Director of Central Intelligence shall, in
consultation with the heads of the elements of the
intelligence community, submit''.
On page 31, strike lines 15 through 20 and insert the
following:
(1) the Select Committee on Intelligence and the Committees
on Armed Services and the Judiciary of the Senate; and
(2) the Permanent Select Committee on Intelligence, the
Select Committee on Homeland Security, and the Committees on
Armed Services and the Judiciary of the House of
Representatives.
On page 35, line 21, insert after ``shall'' the following:
``, after such consultation with the Secretary of State and
the Attorney General as the Director considers
appropriate,''.
On page 36, strike line 23 and all that follows through
page 37, line 3, and insert the following:
(1) the Select Committee on Intelligence and the Committees
on Armed Services and Foreign Relations of the Senate; and
(2) the Permanent Select Committee on Intelligence and the
Committees on Armed Services and International Relations of
the House of Representatives.
On page 37, strike line 24 and all that follows through
page 38, line 5.
On page 38, strike lines 9 and 10 and insert the following:
(1) by striking subsection (d); and
(2) by redesignating subsection (e) as subsection (d).
On page 39, strike lines 7 through 12.
On page 40, strike lines 14 through 16 and insert the
following:
(iii) in subparagraph (G), as so redesignated, by striking
``section 114(c)'' and inserting ``section 114(b)''.
On page 40, strike lines 18 through 25 and insert the
following:
(i) in subparagraph (A), by striking ``section 114(b)'' and
inserting ``section 114(a)'';
(ii) in subparagraph (B), by striking ``section 114(d)''
and inserting ``section 114(c)'';
(iii) by striking subparagraphs (C), (E), and (F); and
(iv) by redesignating subparagraphs (D) and (G) as
subparagraphs (C) and (D), respectively; and
On page 41, strike lines 2 through 5 and insert the
following:
(A) by striking paragraph (1); and
(B) by redesignating paragraphs (2) through (8) as
paragraphs (1) through (7), respectively.
On page 41, between lines 16 and 17, insert the following:

SEC. 340. REPORT ON OPERATIONS OF DIRECTORATE OF INFORMATION
ANALYSIS AND INFRASTRUCTURE PROTECTION AND
TERRORIST THREAT INTEGRATION CENTER.

(a) Report Required.--The Secretary of Homeland Security
shall submit to the appropriate committees of Congress a
report on the operations of the Directorate of Information
Analysis and Infrastructure Protection of the Department of
Homeland Security and the Terrorist Threat Integration
Center. The report shall include the following:
(1) An assessment of the operations of the Directorate,
including the capability of the Directorate--
(A) to meet personnel requirements, including requirements
to employ qualified analysts, and the status of efforts to
employ qualified analysts;
(B) to share intelligence information with the other
elements of the intelligence community, including the sharing
of intelligence information through secure information
technology connections between the Directorate and the other
elements of the intelligence community;
(C) to disseminate intelligence information, or analyses of
intelligence information, to other departments and agencies
of the Federal Government and, as appropriate, to State and
local governments;
(D) to coordinate with State and local counterterrorism and
law enforcement officials;
(E) to access information, including intelligence and law
enforcement information, from the departments and agencies of
the Federal Government, including the ability to access, in a
timely and efficient manner, all information authorized by
section 202 of the Homeland Security Act of 2002 (Public Law
107-296; 6 U.S.C. 122); and
(F) to fulfill, given the current assets and capabilities
of the Directorate, the responsibilities set forth in section
201 of the Homeland Security Act of 2002 (6 U.S.C. 121);
(2) A delineation of the responsibilities and duties of the
Directorate and of the responsibilities and duties of the
Center.
(3) A delineation and summary of the areas in which the
responsibilities and duties of the Directorate and the Center
overlap.
(4) An assessment of whether the areas of overlap, if any,
delineated under paragraph (3) represent an inefficient
utilization of the limited resources of the Directorate and
the intelligence community.
(5) Such information as the Secretary, in coordination with
the Director of Central Intelligence and the Director of the
Federal Bureau of Investigation, considers appropriate to
explain the basis for the establishment and operation of the
Center as a ``joint venture'' of participating agencies
rather than as an element of the Directorate reporting
directly to the Secretary through the Under Secretary of
Homeland Security for Information Analysis and Infrastructure
Protection.
(b) Submittal Date.--The report required by this section
shall be submitted not later than May 1, 2004.
(c) Form.--The report required by this section shall be
submitted in unclassified form, but may include a classified
annex.
(d) Appropriate Committees of Congress Defined.--In this
section, the term ``appropriate committees of Congress''
means--
(1) the Select Committee on Intelligence and the Committees
on Governmental Affairs, the Judiciary, and Appropriations of
the Senate; and
(2) the Permanent Select Committee on Intelligence, the
Select Committee on Homeland Security, and the Committees on
the Judiciary and Appropriations of the House of
Representatives.
On page 49, strike line 25 and all that follows through
page 50, line 1, and insert the following:
1949.--(1) Section 5(a)(1) of the Central Intelligence Agency
Act of 1949 (50 U.S.C. 403f(a)(1)) is amended by striking
``(c)(6)'' each place it appears and inserting ``(c)(7)''.
(2) Section 6 of that Act (50 U.S.C. 403g) is amended by
striking
On page 52, between lines 12 and 13, insert the following:

SEC. 357. TREATMENT OF CLASSIFIED INFORMATION IN MONEY
LAUNDERING CASES.

Section 5318A of title 31, United States Code, is amended
by adding at the end the following:

[[Page S10837]]

``(f) Classified Information.--In any judicial review of a
finding of the existence of a primary money laundering
concern, or of the requirement for 1 or more special measures
with respect to a primary money laundering concern, made
under this section, if the designation or imposition, or
both, were based on classified information (as defined in
section 1(a) of the Classified Information Procedures Act (18
U.S.C. App.), such information may be submitted by the
Secretary to the reviewing court ex parte and in camera. This
subsection does not confer or imply any right to judicial
review of any finding made or required under this section.''.

On page 55, between lines 2 and 3, insert the following:

SEC. 405. CONTRIBUTION BY CENTRAL INTELLIGENCE AGENCY
EMPLOYEES OF CERTAIN BONUS PAY TO THRIFT
SAVINGS PLAN ACCOUNTS.

(a) CSRS Participants.--Section 8351(d) of title 5, United
States Code, is amended--
(1) by inserting ``(1)'' after ``(d)''; and
(2) by adding at the end the following new paragraph:
``(2)(A) An employee of the Central Intelligence Agency
making contributions to the Thrift Savings Fund out of basic
pay may also contribute (by direct transfer to the Fund) any
part of bonus pay received by the employee as part of the
pilot project required by section 402(b) of the Intelligence
Authorization Act for Fiscal Year 2003 (Public Law 107-306;
116 Stat. 2403; 50 U.S.C. 403-4 note).
``(B) Contributions under this paragraph are subject to
section 8432(d) of this title.''.
(b) FERS Participants.--Section 8432 of title 5, United
States Code, is amended by adding at the end the following
new subsection:
``(k)(1) An employee of the Central Intelligence Agency
making contributions to the Thrift Savings Fund out of basic
pay may also contribute (by direct transfer to the Fund) any
part of bonus pay received by the employee as part of the
pilot project required by section 402(b) of the Intelligence
Authorization Act for Fiscal Year 2003 (Public Law 107-306;
116 Stat. 2403; 50 U.S.C. 403-4 note).
``(2) Contributions under this subsection are subject to
subsection (d).
``(3) For purposes of subsection (c), basic pay of an
employee of the Central Intelligence Agency shall include
bonus pay received by the employee as part of the pilot
project referred to in paragraph (1).''.
On page 74, after line 5, add the following:

SEC. 503. USE OF FUNDS FOR COUNTERDRUG AND COUNTERTERRORISM
ACTIVITIES FOR COLOMBIA.

(a) Authority.--Funds designated for intelligence or
intelligence-related purposes for assistance to the
Government of Colombia for counterdrug activities for fiscal
year 2004 or 2005, and any unobligated funds available to any
element of the intelligence community for such activities for
a prior fiscal year, shall be available--
(1) to support a unified campaign against narcotics
trafficking and against activities by organizations
designated as terrorist organizations (such as the
Revolutionary Armed Forces of Colombia (FARC), the National
Liberation Army (ELN), and the United Self-Defense Forces of
Colombia (AUC)); and
(2) to take actions to protect human health and welfare in
emergency circumstances, including undertaking rescue
operations.
(b) Termination of Authority.--The authority provided in
subsection (a) shall cease to be effective if the Secretary
of Defense has credible evidence that the Colombian Armed
Forces are not conducting vigorous operations to restore
government authority and respect for human rights in areas
under the effective control of paramilitary and guerrilla
organizations.
(c) Application of Certain Provisions of Law.--Sections
556, 567, and 568 of Public Law 107-115, section 8093 of the
Department of Defense Appropriations Act, 2002, and the
numerical limitations on the number of United States military
personnel and United States individual civilian contractors
in section 3204(b)(1) of Public Law 106-246 shall be
applicable to funds made available pursuant to the authority
contained in subsection (a).
(d) Limitation on Participation of United States
Personnel.--No United States Armed Forces personnel or United
States civilian contractor employed by the United States will
participate in any combat operation in connection with
assistance made available under this section, except for the
purpose of acting in self defense or rescuing any United
States citizen to include United States Armed Forces
personnel, United States civilian employees, and civilian
contractors employed by the United States.

SEC. 504. SCENE VISUALIZATION TECHNOLOGIES.

Of the amount authorized to be appropriated by this Act,
$2,500,000 shall be available for the National Imagery and
Mapping Agency (NIMA) for scene visualization technologies.
______

SA 1539. Mr. SUNUNU (for Mr. Hatch) proposed an amendment to the
concurrent resolution S. Con. Res. 25, recognizing and honoring
America's Jewish community on the occasion of its 350th anniversary,
supporting the designation of an ``American Jewish History Month,'' and
for other purposes; as follows:

Strike all after the resolving clause and insert the
following:
That Congress--
(1) recognizes the 350th anniversary of the American Jewish
community;
(2) supports the designation of an ``American Jewish
History Month''; and
(3) urges all Americans to share in this commemoration so
as to have a greater appreciation of the role the American
Jewish community has had in helping to defend and further the
liberties and freedom of all Americans.

____________________