[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 249 Introduced in Senate (IS)]







107th CONGRESS
  1st Session
                                 S. 249

  To amend the Internal Revenue Code of 1986 to expand the credit for 
         electricity produced from certain renewable resources.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            February 6, 2001

   Mr. Reid introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
  To amend the Internal Revenue Code of 1986 to expand the credit for 
         electricity produced from certain renewable resources.

    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 ``Renewable Energy Development 
Incentives Act''.

SEC. 2. EXPANSION OF RENEWABLE RESOURCE CREDIT TO INCLUDE ALTERNATIVE 
              RESOURCES.

    (a) In General.--Section 45(c)(1) of the Internal Revenue Code of 
1986 (relating to qualified energy resources) is amended by striking 
``and'' at the end of subparagraph (B), by striking the period at the 
end of subparagraph (C) and inserting ``, and'', and by adding at the 
end the following:
                    ``(D) alternative resources.''.
    (b) Definition of Alternative Resources.--Section 45(c) of the 
Internal Revenue Code of 1986 (relating to definitions) is amended by 
adding at the end the following:
            ``(5) Alternative Resources.--
                    ``(A) In general.--The term `alternative resources' 
                means--
                            ``(i) solar,
                            ``(ii) biomass (other than closed loop 
                        biomass),
                            ``(iii) incremental hydropower, and
                            ``(iv) geothermal energy.
                    ``(B) Biomass.--The term `biomass' means any solid, 
                nonhazardous, cellulosic waste material, which is 
                segregated from other waste materials, and which is 
                derived from--
                            ``(i) any of the following forest-related 
                        resources: mill residues, precommercial 
                        thinnings, slash, and brush, but not including 
                        old-growth timber or black liquor,
                            ``(ii) agriculture sources, including 
                        orchard tree crops, vineyard, grain, legumes, 
                        sugar, and other crop by-products or residues, 
                        or
                            ``(iii) waste pallets, crates, and dunnage, 
                        and landscape or right-of-way tree trimmings, 
                        but not including--
                                    ``(I) unsegregated municipal solid 
                                waste (garbage), or
                                    ``(II) post-consumer wastepaper 
                                which can be recycled affordably.
                    ``(C) Incremental hydropower.--The term 
                `incremental hydropower' means additional generating 
                capacity achieved from--
                            ``(i) increased efficiency, or
                            ``(ii) additions of new capacity,
                at a licensed non-Federal hydroelectric project 
                originally placed in service before the date of 
                enactment of this paragraph.''.
    (c) Qualified Facility.--Section 45(c)(3) of the Internal Revenue 
Code of 1986 (defining qualified facility) is amended by adding at the 
end the following:
                    ``(D) Alternative resources facility.--In the case 
                of a facility using alternative resources to produce 
                electricity, the term `qualified facility' means any 
                facility owned by the taxpayer which is originally 
                placed in service after December 31, 1992.''.
    (d) Government-Owned Facility.--The text and heading of section 
45(d)(6) of the Internal Revenue Code of 1986 (relating to credit 
eligibility in the case of government-owned facilities using poultry 
waste) is amended by inserting ``or alternative resources'' after 
``poultry waste'' each place it appears.
    (e) Qualified Facilities With Co-Production.--Section 45(b) of the 
Internal Revenue Code of 1986 (relating to limitations and adjustments) 
is amended by adding at the end the following:
            ``(4) Increased credit for co-production facilities.--
                    ``(A) In general.--In the case of a qualified 
                facility described in subsection (c)(3)(D) which has a 
                co-production facility or a qualified facility 
                described in subparagraph (A), (B), or (C) of 
                subsection (c)(3) which adds a co-production facility 
                after the date of the enactment of this paragraph, the 
                amount in effect under subsection (a)(1) for an 
                eligible taxable year of a the taxpayer shall (after 
                adjustment under paragraphs (1), (2), and (3)) be 
                increased by .25 cents.
                    ``(B) Co-production facility.--For purposes of 
                subparagraph (A), the term `co-production facility' 
                means a facility which--
                            ``(i) enables a qualified facility to 
                        produce heat, mechanical power, or minerals 
                        from qualified energy resources in addition to 
                        electricity, and
                            ``(ii) produces such energy on a continuous 
                        basis.
                    ``(C) Eligible taxable year.--For purposes of 
                subparagraph (A), the term `eligible taxable year' 
                means any taxable year in which the amount of gross 
                receipts attributable to the co-production facility of 
                a qualified facility are at least 10 percent of the 
                amount of gross receipts attributable to electricity 
                produced by such facility.''.
    (f) Qualified Facilities Located Within Qualified Indian Lands.--
Section 45(b) of the Internal Revenue Code of 1986 (relating to 
limitations and adjustments), as amended by subsection (e), is amended 
by adding at the end the following:
            ``(5) Increased credit for qualified facility located 
        within qualified indian land.--In the case of a qualified 
        facility described in subsection (c)(3)(D) which--
                    ``(A) is located within--
                            ``(i) qualified Indian lands (as defined in 
                        section 7871(c)(3)), or
                            ``(ii) lands which are held in trust by a 
                        Native Corporation (as defined in section 3(m) 
                        of the Alaska Native Claims Settlement Act (43 
                        U.S.C. 1602(m)) for Alaska Natives, and
                    ``(B) is operated with the explicit written 
                approval of the Indian tribal government or Native 
                Corporation (as so defined) having jurisdiction over 
                such lands,
        the amount in effect under subsection (a)(1) for a taxable year 
        shall (after adjustment under paragraphs (1), (2), (3), and 
        (4)) be increased by .25 cents.''.
    (g) Effective Date.--The amendments made by this section shall 
apply to electricity and other energy produced in taxable years 
beginning after the date of the enactment of this Act.

SEC. 2. ADDITIONAL MODIFICATIONS OF RENEWABLE RESOURCE CREDIT.  

    (a) Credit May Be Transferred.--Section 45(d) of the Internal 
Revenue Code of 1986 (relating to definitions and special rules) is 
amended by adding at the end the following:
            ``(8) Credit may be transferred.--Nothing in any law or 
        rule of law shall be construed to limit the transferability of 
        the credit allowed by this section through agreements by the 
        owner of a qualified facility--
                    ``(A) with any organization that purchases 
                electricity from, or sells electricity for, such 
                facility, or
                    ``(B) if such owner is exempt from tax under this 
                chapter.''.
    (b) Coordination With Other Credits.--Section 45(d) of the Internal 
Revenue Code of 1986, as amended by subsection (a), is amended by 
adding at the end the following:
            ``(9) Coordination with other credits.--This section shall 
        not apply to any qualified facility with respect to which the 
        energy credit under section 48 is allowed for the taxable year 
        unless the taxpayer elects to waive the application of such 
        credit to such facility.''.
    (c) Expansion To Include Animal Waste.--Section 45 of the Internal 
Revenue Code of 1986 (relating to electricity produced from certain 
renewable resources) is amended--
            (1) in the text and headings of subsections (c) and (d)(6), 
        by inserting ``or other animal waste'' after ``poultry waste'' 
        each place it appears, and
            (2) in subsection (c)(4), by inserting ``or other animal'' 
        after ``poultry''.
    (d) Treatment of Qualified Facilities Not In Compliance With 
Pollution Laws.--Section 45(c)(3) of the Internal Revenue Code of 1986 
(relating to qualified facilities), as amended by section 1(c), is 
amended by adding at the end the following:
                    ``(E) 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.''.
    (e) Credit Allowable Against Regular and Minimum Tax.--
            (1) In general.--Section 38(c) of the Internal Revenue Code 
        of 1986 (relating to limitation based on amount of tax) is 
        amended by redesignating paragraph (3) as paragraph (4) and 
        inserting after paragraph (2) the following:
            ``(3) Special rules for renewable electricity production 
        credit.--
                    ``(A) In general.--In the case of the renewable 
                electricity production credit--
                            ``(i) this section and section 39 shall be 
                        applied separately with respect to the credit, 
                        and
                            ``(ii) in applying paragraph (1) to the 
                        credit--
                                    ``(I) subparagraphs (A) and (B) 
                                thereof shall not apply, and
                                    ``(II) the limitation under 
                                paragraph (1) (as modified by subclause 
                                (I)) shall be reduced by the credit 
                                allowed under subsection (a) for the 
                                taxable year (other than the renewable 
                                electricity production credit).
                    ``(B) Renewable electricity production credit.--For 
                purposes of this subsection, the term `renewable 
                electricity production credit' means the credit 
                allowable under subsection (a) by reason of section 
                45(a).''.
            (2) Conforming amendment.--Subclause (II) of section 
        38(c)(2)(A)(ii) of such Code is amended by inserting ``or the 
        renewable electricity production credit'' after ``employment 
        credit''.
    (f) Credit Made Permanent.--Section 45 of the Internal Revenue Code 
of 1986 is amended by striking subsection (f).
    (g) Expansion of Qualified Facility Dates.--Subparagraphs (A), (B), 
and (C) of section 45(c)(3) of the Internal Revenue Code of 1986 
(relating to qualified facility) are each amended by striking ``, and 
before January 1, 2002''.
    (h) Effective Date.--The amendments made by this section shall 
apply to electricity and other energy produced in taxable years 
beginning after the date of the enactment of this Act.
                                 <all>