[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 1923 Introduced in Senate (IS)]







107th CONGRESS
  2d Session
                                S. 1923

To provide for increased corporate average fuel economy standards, and 
                          for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            February 7, 2002

Mr. Lott (for Mr. McCain) introduced the following bill; which was read 
     twice and referred to the Committee on Commerce, Science, and 
                             Transportation

_______________________________________________________________________

                                 A BILL


 
To provide for increased corporate average fuel economy standards, and 
                          for other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fuel Economy and Security Act of 
2002''.

SEC. 2. TABLE OF CONTENTS.

    The table of contents for this Act is as follows:

Sec. 1. Short Title.
Sec. 2. Table of Contents.
              TITLE I--IMPROVED FUEL ECONOMY FOR VEHICLES

Sec. 101. Average fuel economy standards for passenger automobiles and 
                            light trucks.
Sec. 102. Replacement of dual fuel credit with registry for trading 
                            credits.
Sec. 103. Elimination of 2-fleet rule.
Sec. 104. Elimination of dual fuel credit.
Sec. 105. High occupancy vehicle exception.
    TITLE II--MARKET-BASED INITIATIVES FOR GREENHOUSE GAS REDUCTION

Sec. 201. Market-based initiatives.
Sec. 202. Implementing panel.
Sec. 203. Definitions.
                       TITLE III--VEHICLE SAFETY

Sec. 301. Roof crush standard.
Sec. 302. Safety rating labels.

              TITLE I--IMPROVED FUEL ECONOMY FOR VEHICLES

SEC. 101. AVERAGE FUEL ECONOMY STANDARDS FOR PASSENGER AUTOMOBILES AND 
              LIGHT TRUCKS.

    (a) Increased Standards.--Section 32902 of title 49, United States 
Code, is amended--
            (1) by striking ``Non-Passenger Automobiles.--'' in 
        subsection (a) and inserting ``Prescription of Standards by 
        Regulation.--''; and
            (2) by striking ``(except passenger automobiles)'' in 
        subsection (a) and inserting ``(except passenger automobiles 
        and light trucks)'';
            (3) by striking subsection (b) and inserting the following:
    ``(b) Standards for Passenger Automobiles and Light Trucks.--
            ``(1) In general.--The Secretary of Transportation, after 
        consultation with the Administrator of the Environmental 
        Protection Agency, shall prescribe average fuel economy 
        standards for passenger automobiles and light trucks 
        manufactured by a manufacturer in each model year beginning 
        with model year 2007 in order to achieve a combined average 
        fuel economy standard for model year 2016 of 36 miles per 
        gallon. In prescribing average fuel economy standards under 
        this paragraph, the Secretary shall prescribe appropriate 
        annual fuel economy standard increases that increase the 
        applicable average fuel economy standard annually during the 9 
        model-year period beginning with model year 2007.
            ``(2) Deadline for regulations.--The Secretary shall 
        promulgate the regulations required by paragraph (1) in final 
        form no later than 24 months after the date of enactment of the 
        Fuel Economy and Security Act of 2002.
            ``(3) Default standards.--If the regulations required by 
        paragraph (1) are not promulgated in final form within the 
        period required by paragraph (2), then the average fuel economy 
        standard for passenger automobiles and light trucks 
        manufactured by a manufacturer is--
                    ``(A) for model year 2012, a standard (expressed in 
                miles per gallon) that represents 50 percent of the 
                difference between--
                            ``(i) 36 miles per gallon; and
                            ``(ii) the average fuel economy for 
                        passenger automobiles and light trucks 
                        manufactured by a manufacturer in model year 
                        2006; and
                    ``(B) 36 miles per gallon for model year 2016 and 
                thereafter.'';
            (4) by striking ``the standard'' in subsection (c)(1) and 
        inserting ``a standard'';
            (5) by striking the first and last sentences of subsection 
        (c)(2); and
            (6) by striking ``(and submit the amendment to Congress 
        when required under subsection (c)(2) of this section)'' in 
        subsection (g).
    (b) Definition of Light Trucks.--
            (1) In general.--Section 32901(a) of title 49, United 
        States Code, is amended by adding at the end the following:
            ``(17) `light truck' means an automobile that the Secretary 
        decides by regulation--
                    ``(A) is manufactured primarily for transporting 
                not more than 10 individuals;
                    ``(B) is rated at not more than 10,000 pounds gross 
                vehicle weight;
                    ``(C) is not a passenger automobile; and
                    ``(D) does not fall within the exceptions from the 
                definition of `medium duty passenger vehicle' under 
                section 8601-01 of title 40, Code of Federal 
                Regulations.''.
            (2) Deadline for regulations.--The Secretary of 
        Transportation--
                    (A) shall issue proposed regulations implementing 
                the amendment made by paragraph (1) not later than 1 
                year after the date of the enactment of this Act; and
                    (B) shall issue final regulations implementing the 
                amendment not later than 18 months after the date of 
                the enactment of this Act.
            (3) Effective date.--Regulations prescribed under paragraph 
        (1) shall apply beginning with model year 2007.
    (c) Applicability of Existing Standards.--This section does not 
affect the application of section 32902 of title 49, United States 
Code, to passenger automobiles  or non-passenger automobiles 
manufactured before model year 2007.
    (d) Authorization of Appropriations.--There are authorized to be 
appropriated to the Secretary of Transportation to carry out the 
provisions of chapter 329 of title 49, United States Code, $25,000,000 
for each of fiscal years 2003 through 2016.

SEC. 102. FUEL ECONOMY STANDARD CREDITS.

    (a) In General.--Section 32903 of title 49, United States Code, is 
amended by striking the second sentence of subsection (a) and inserting 
``The credits--
            ``(1) may be applied to any of the 3 model years 
        immediately following the model year for which the credits are 
        earned; or
            ``(2) transferred to the registry established under section 
        201 of the Fuel Economy and Security Act of 2002.''.
    (b) Greenhouse Gas Credits Applied to CAFE Standards.--Section 
32903 of title 49, United States Code, is amended by adding at the end 
the following:
    ``(g) Greenhouse Gas Credits.--
            ``(1) In general.--A manufacturer may apply credits 
        purchased through the registry established by section 201 of 
        the Fuel Economy and Security Act of 2002 toward any model year 
        after model year 2006 under subsection (d), subsection (e), or 
        both.
            ``(2) Limitation.--A manufacturer may not use credits 
        purchased through the registry to offset more than 10 percent 
        of the fuel economy standard applicable to any model year.''.

SEC. 103. ELIMINATION OF 2-FLEET RULE.

    (a) In General.--Section 32904 of title 49, United States Code, is 
amended--
            (1) by striking subsection (b); and
            (2) by redesignating subsections (c) through (e) as 
        subsections (b) through (d), respectively.
    (b) Effective Date.--The amendments made by subsection (a) shall 
apply to model years 2007 and later.

SEC. 104. ELIMINATION OF DUAL FUEL CREDIT.

    Section 32905 of title 49, United States Code, is repealed.

SEC. 105. HIGH OCCUPANCY VEHICLE EXCEPTION.

    (a) In General.--Notwithstanding section 102(a)(1) of title 23, 
United States Code, a State may, for the purpose of promoting energy 
conservation, permit a vehicle with fewer than 2 occupants to operate 
in high occupancy vehicle lanes if it is a hybrid vehicle or is 
certified by the Secretary of Transportation, after consultation with 
the Administrator of the Environmental Protection Agency, to be a 
vehicle that utilizes only an alternative fuel.
    (b) Hybrid Vehicle Defined.--In this section, the term ``hybrid 
vehicle'' means a motor vehicle other than a light truck (as defined in 
section 32901(a)(17) of title 49, United States Code)--
            (1) which--
                    (A) 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; 
                        or
                    (B) recovers kinetic energy through regenerative 
                braking and provides at least 13 percent maximum power 
                from the electrical storage device;
            (2) which, in the case of a passenger automobile--
                    (A) for 2002 and later model vehicles, has received 
                a certificate of conformity under section 206 of the 
                Clean Air Act (42 U.S.C. 7525) and meets or exceeds the 
                equivalent qualifying California low emission vehicle 
                standard under section 243(e)(2) of the Clean Air Act 
                (42 U.S.C. 7583(e)(2)) for that make and model year; 
                and
                    (B) for 2004 and later model vehicles, has received 
                a certificate that such vehicle meets the 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 (42 
                U.S.C. 7521(i)) for that make and model year vehicle; 
                and
            (3) which is made by a manufacturer.
    (c) Alternative Fuel Defined.--In this section, the term 
``alternative fuel'' has the meaning such term has under section 301(2) 
of the Energy Policy Act of 1992 (42 U.S.C. 13211(2)).

    TITLE II--MARKET-BASED INITIATIVES FOR GREENHOUSE GAS REDUCTION

SEC. 201. MARKET-BASED INITIATIVES.

    (a) Establishment of Registry for Voluntary Trading Systems.--The 
Secretary of Commerce, through the Undersecretary for Technology, shall 
establish a national registry system for greenhouse gas trading among 
industry under which emission reductions from the applicable baseline 
are assigned unique identifying numerical codes by the registry. 
Participation in the registry is voluntary. Any entity conducting 
business in the United States may register its emission results, 
including emissions generated outside of the United States, on an 
entity-wide basis with the registry, and may utilize the services of 
the registry.
    (b) Purposes.--The purposes of the national registry are--
            (1) to encourage voluntary actions to reduce greenhouse gas 
        emissions and increase energy efficiency, including increasing 
        the fuel economy of passenger automobiles and light trucks and 
        reducing the reliance by United States markets on petroleum 
        produced outside the United States used to provide vehicular 
        fuel;
            (2) to enable participating entities to record voluntary 
        greenhouse gas emissions reductions; in a consistent format 
        that is supported by third party verification;
            (3) to encourage participants involved in existing 
        partnerships to be able to trade emissions reductions among 
        partnerships;
            (4) to further recognize, publicize, and promote 
        registrants making voluntary and mandatory reductions;
            (5) to recruit more participants in the program; and
            (6) to help various entities in the nation establish 
        emissions baselines.
    (c) Functions.--The national registry shall carry out the following 
functions:
            (1) Referrals.--Provide referrals to approved providers for 
        advice on--
                    (A) designing programs to establish emissions 
                baselines and to monitor and track greenhouse gas 
                emissions; and
                    (B) establishing emissions reduction goals based on 
                international best practices for specific industries 
                and economic sectors.
            (2) Uniform reporting format.--Adopt a uniform format for 
        reporting emissions baselines and reductions established 
        through--
                    (A) the Director of the National Institute of 
                Standards and Technology for greenhouse gas baselines 
                and reductions generally; and
                    (B) the Secretary of Transportation for credits 
                under section 32903 of title 49, United States Code.
            (3) Record maintenance.--Maintain a record of all emission 
        baselines and reductions verified by qualified independent 
        auditors.
            (4) Encourage participation.--Encourage organizations from 
        various sectors to monitor emissions, establish baselines and 
        reduction targets, and implement efficiency improvement and 
        renewable energy programs to achieve those targets.
            (5) Public awareness.--Recognize, publicize, and promote 
        participants that--
                    (A) commit to monitor their emissions and set 
                reduction targets;
                    (B) establish emission baselines; and
                    (C) report on the amount of progress made on their 
                annual emissions.
    (d) Transfer of Reductions.--The registry shall--
            (1) allow for the transfer of ownership of any reductions 
        realized in accordance with the program; and
            (2) require that the registry be notified of any such 
        transfer within 30 days after the transfer is effected.
    (e) Future Considerations.--Any reductions achieved under this 
program shall be credited against any future mandatory greenhouse gas 
reductions required by the government. Final approval of the amount and 
value of credits shall be determined by the agency responsible for the 
implementation of the mandatory greenhouse gas emission reduction 
program, except that credits under section 32903 of title 49, United 
States Code, shall be determined by the Secretary of Transportation. 
The Secretary of Commerce shall by rule establish an appeals process, 
that may incorporate an arbitration option, for resolving any dispute 
arising out of such a determination made by that agency.
    (f) CAFE Standards Credits.--The Secretary of Transportation shall 
work with the Secretary of Commerce and the implementing panel 
established by section 202 to determine the equivalency of credits 
earned under section 32903 of title 49, United States Code, for 
inclusion in the registry. The Secretary shall by rule establish an 
appeals process, that may incorporate an arbitration option, for 
resolving any dispute arising out of such a determination.

SEC. 202. IMPLEMENTING PANEL.

    (a) Establishment.--There is established within the Department of 
Commerce an implementing panel.
    (b) Composition.--The panel shall consist of--
            (1) the Secretary of Commerce or the Secretary's designee, 
        who shall serve as Chairperson;
            (2) the Secretary of Transportation or the Secretary's 
        designee; and
            (3) 1 expert in the field of greenhouse gas emissions 
        reduction, certification, or trading from each of the following 
        agencies--
                    (A) the Department of Energy;
                    (B) the Environmental Protection Agency;
                    (C) the Department of Agriculture;
                    (D) the National Aeronautics and Space 
                Administration;
                    (E) the Department of Commerce; and
                    (F) the Department of Transportation.
    (c) Experts and Consultants.--Any member of the panel may secure 
the services of experts and consultants in accordance with the 
provisions of section 3109 of title 5, United States Code, for 
greenhouse gas reduction, certification, and trading experts in the 
private and non-profit sectors and may also utilize any grant, 
contract, cooperative agreement, or other arrangement authorized by law 
to carry out its activities under this subsection.
    (d) Duties.--The panel shall--
            (1) implement and oversee the implementation of this 
        section;
            (2) promulgate--
                    (A) standards for certification of registries and 
                operation of certified registries; and
                    (B) standards for measurement, verification, and 
                recording of greenhouse gas emissions and greenhouse 
                gas emission reductions by certified registries;
            (3) maintain, and make available to the public, a list of 
        certified registries; and
            (4) issue rulemakings on standards for measuring, 
        verifying, and recording greenhouse gas emissions and 
        greenhouse gas emission reductions proposed to the panel by 
        certified registries, through a standard process of issuing a 
        proposed rule, taking public comment for no less than 30 days, 
        then finalizing regulations to implement this act, which will 
        provide for recognizing new forms of acceptable greenhouse gas 
        reduction certification procedures.
    (e) Certification and Operation Standards.--The standards 
promulgated by the panel shall include--
            (1) standards for ensuring that certified registries do not 
        have any conflicts of interest, including standards that 
        prohibit a certified registry from--
                    (A) owning greenhouse gas emission reductions 
                recorded in any certified registry; or
                    (B) receiving compensation in the form of a 
                commission where sources receive money for the total 
                number of tons certified;
            (2) standards for authorizing certified registries to enter 
        into agreements with for-profit persons engaged in trading of 
        greenhouse gas emission reductions, subject to paragraph (1); 
        and
            (3) such other standards for certification of registries 
        and operation of certified registries as the panel determines 
        to be appropriate.
    (f) Measurement, Verification, and Recording Standards.--The 
standards promulgated by the panel shall provide for, in the case of 
certified registries--
            (1) ensuring that certified registries accurately measure, 
        verify, and record greenhouse gas emissions and greenhouse gas 
        emission reductions, taking into account--
                    (A) boundary issues such as leakage and shifted 
                utilization; and
                    (B) such other factors as the panel determines to 
                be appropriate;
            (2) ensuring that--
                    (A) certified registries do not double-count 
                greenhouse gas emission reductions; and
                    (B) if greenhouse gas emission reductions are 
                recorded in more than 1 certified registry, such 
                double-recording is clearly indicated;
            (3) determining the ownership of greenhouse gas emission 
        reductions and recording and tracking the transfer of 
        greenhouse gas emission reductions among entities (such as 
        through assignment of serial numbers to greenhouse gas emission 
        reductions);
            (4) measuring the results of the use of carbon 
        sequestration and carbon recapture technologies;
            (5) measuring greenhouse gas emission reductions resulting 
        from improvements in--
                    (A) power plants;
                    (B) automobiles (including types of passenger 
                automobiles and light trucks, as defined in section 
                32901(a) (16) and (17) respectively, produced in the 
                same model year);
                    (C) carbon re-capture, storage and sequestration, 
                including organic sequestration and manufactured 
                emissions injection, and or storage; and
                    (D) other sources;
            (6) measuring prevented greenhouse gas emissions through 
        the rulemaking process and based on the latest scientific data, 
        sampling, expert analysis related to measurement and 
        projections for prevented greenhouse gas emissions in tons 
        including--
                    (A) organic soil carbon sequestration practices; 
                and
                    (B) forest preservation and re-forestation 
                activities which adequately address the issues of 
                permanence, leakage and verification; and
            (7) such other measurement, verification, and recording 
        standards as the panel determines to be appropriate.
    (g) Certification of Registries.--Except as provided in subsection 
(h), a registrant that desires to be a certified registry shall submit 
to the panel an application that--
            (1) demonstrates that the registrant meets each of the 
        certification standards established by the panel under 
        subsections (d) and (e); and
            (2) meets such other requirements as the panel may 
        establish.
    (h) Automobile Industry.--The Secretary of Transportation is deemed 
to be the certified registrant for credits earned under section 32903 
of title 49, United States Code.
    (i) Annual Report.--Within 1 year after the date after the date of 
enactment of this Act and biennially  thereafter, the panel shall 
report to the Congress on the status of the program established under 
this section. The report shall include an assessment of the level of 
participation in the program and amount of progress being made on 
emission reduction targets.

SEC. 203. DEFINITIONS.

    In this title:
            (1) Greenhouse gas.--The term ``greenhouse gas'' includes--
                    (A) carbon dioxide;
                    (B) methane;
                    (C) hydro fluorocarbons;
                    (D) perfluorocarbons;
                    (E) nitrous oxide; and
                    (F) sulfur hexafluoride.
            (2) Baseline.--The term ``baseline'' means--
                    (A) the greenhouse gas emissions, determined on an 
                entity-wide basis for the participant's most recent 
                previous 3-year annual average of greenhouse gas 
                emissions prior to the date of enactment of this Act; 
                or
                    (B) if data is unavailable for that 3-year period, 
                the greenhouse gas emissions as of September 30, 2002, 
                (or as close to that date as such emission levels can 
                reasonably be determined). In promulgating regulations 
                under this title, the panel shall take into account 
                greenhouse gas emission reductions or off-setting 
                actions taken by any entity before the date on which 
                the registry is established.
            (3) Certified registry.--The term ``certified registry'' 
        means a registry that has been certified by the panel as 
        meeting the standards promulgated under section 202(e) and (f) 
        and, for the automobile industry, the Secretary of 
        Transportation.
            (4) Greenhouse gas emissions.--The term ``greenhouse gas 
        emissions'' means the quantity of greenhouse gases emitted by a 
        source during a period, measured in tons of greenhouse gases.
            (5) Greenhouse gas emission reduction.--The term 
        ``greenhouse gas emission reduction'' means a quantity equal to 
        the difference between--
                    (A) the greenhouse gas emissions of a source during 
                a period; and
                    (B) the greenhouse gas emissions of the source 
                during a baseline period of the same duration as 
                determined by registries and entities defined as owners 
                of emission sources.
            (6) Kyoto protocol.--The term ``Kyoto protocol'' means the 
        Kyoto Protocol to the United Nations Framework Convention on 
        Climate Change (including the Montreal Protocol to the 
        Convention on Substances that Deplete the Ozone Layer).
            (7) Panel.--The term ``panel'' means the implementing panel 
        established by section 202(a).
            (8) Registrant.--The term ``registrant'' means a private 
        person that operates a database recording quantified and 
        verified greenhouse gas emissions and emissions reductions of 
        sources owned by other entities.
            (9) Source.--The term ``source'' means a source of 
        greenhouse gas emissions.

                       TITLE III--VEHICLE SAFETY

SEC. 301. ROOF CRUSH SAFETY STANDARD.

    (a) Improved Crashworthiness.--Subchapter II of chapter 301 of 
title 49, United States Code, is amended by adding at the end the 
following:
``Sec. 30128. Improved crashworthiness
    ``Within 3 years after the date of enactment of the Fuel Economy 
and Security Act of 2002, the Secretary of Transportation, through the 
National Highway Traffic Safety Administration, shall prescribe a motor 
vehicle safety standard under this chapter for rollover crashworthiness 
standards that includes--
            ``(1) dynamic roof crush standards;
            ``(2) improved seat structure and safety belt design;
            ``(3) side impact head protection airbags; and
            ``(4) roof injury protection measures.''.
    (b) Conforming Amendment.--The chapter analysis for chapter 301 of 
title 49, United States Code, is amended by inserting after the item 
relating to section 30127 the following:

                              ``30128. Improved crashworthiness''.

SEC. 302. SAFETY RATING LABELS.

    Section 32302 of title 49, United States Code, is amended--
            (1) by redesignating paragraphs (3) and (4) of subsection 
        (a) as paragraphs (4) and (5), respectively;
            (2) by inserting after paragraph (2) of subsection (a) the 
        following:
            ``(3) overall safety of the driver and passengers of the 
        vehicle in a collision.''; and
            (3) by striking subsection (b) and inserting the following:
    ``(b) Motor Vehicle Safety Information.--
            ``(1) In general.--In carrying out subsection (a), the 
        Secretary shall establish test criteria for use by 
        manufacturers in determining damage susceptibility, 
        crashworthiness, and the overall safety of vehicles for drivers 
        and passengers.
            ``(2) Presentation of data.--The Secretary shall prescribe 
        a system for presenting information developed under paragraphs 
        (1) through (3) of subsection (a) to the public in a simple and 
        understandable form that facilitates comparison among the makes 
        and models of passenger motor vehicles.
            ``(3) Label requirement.--Each manufacturer of a new 
        passenger motor vehicle (as defined in section 32304(a)(8)) 
        manufactured after September 30, 2005, and distributed in 
        commerce for sale in the United States shall cause the 
        information required by paragraph (2) to appear on, or adjacent 
        to, the label required by section 3 of the Automobile 
        Information Disclosure Act (15 U.S.C. 1232(b)).''.
                                 <all>