1.This Act may be cited as
the Rural Energy for America Act of
2006
.
2.Congress finds that—
(1)rising energy
costs and uncertain long term energy supplies threaten to undermine the growth
of the United States economy;
(2)since 2003, fuel
and fertilizer costs have nearly doubled for agricultural producers;
(3)there are
continuing and increasing risks to the energy security of the United
States;
(4)having an
affordable, reliable, and plentiful energy supply will strengthen the United
States economy and improve domestic energy security;
(5)the agricultural
sector can provide a significant source of clean, sustainable energy for the
United States that can reduce the dependence of the United States on imported
energy and lower energy costs for all people of the United States;
(6)agriculture-based
energy—
(A)boosts rural
economic development;
(B)increases
farm-based income;
(C)creates
manufacturing, construction, and service jobs;
(D)expands economic
opportunity for all people; and
(E)improves
environmental quality;
(7)it is a goal of
this Act to help the agricultural sector to provide at least 25 percent of the
energy consumed in the United States by calendar year 2025;
(8)expanding
agriculture-based renewable energy resources (including wind, solar, and
geothermal energy, ethanol, and biodiesel) and improving energy efficiency will
help to achieve that goal;
(9)section 9006 of
the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 8106) established
the renewable energy systems and energy efficiency improvements program, which
is the first agricultural program to catalyze broad renewable energy and energy
efficiency measures for the agricultural and rural business sectors;
(10)since
establishment, the program has been a strong success, providing during the
first 3 years of the program nearly $64,000,000 in grants and loan guarantees
for 412 renewable energy and energy efficiency projects in 37 States, which
leveraged approximately $699,000,000 in additional investments in farms and
rural communities;
(11)projects
assisted by the grants and loan guarantees will—
(A)produce or save
more than 17,000,000,000,000 British thermal units of energy each year in the
form of fuel, electricity, thermal energy, and energy efficiency;
(B)produce
124,000,000 gallons of ethanol and biodiesel fuel annually; and
(C)reduce carbon
dioxide emissions by more than 4,000,000 tons annually; and
(12)applications for
assistance under the program—
(A)in 2003, nearly
matched the available funding for the program;
(B)in 2004, were
nearly twice the available funding for the program; and
(C)in 2005 and 2006,
were nearly triple the available funding for the program.
3.Rural Energy for
America ProgramSection 9006
of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 8106) is
amended—
(1)by striking the
section designation and heading and inserting the following:
9006.Rural Energy
for America
Program
;
(2)in subsection
(a)—
(A)by inserting
, and issue rebates,
after grants
; and
(B)by inserting
rural school districts,
after ranchers,
.
(3)by striking
subsection (f);
(4)by redesignating
subsection (e) as subsection (h);
(5)by inserting
after subsection (d) the following:
(e)Production-based
incentive in lieu of grant
(1)In addition to the authority under subsection (a), to
encourage the production of electricity from renewable energy systems, the
Secretary shall, on the request of an eligible applicant under this section,
make production-based payments to the applicant in lieu of a grant.
(2)Payments
under paragraph (1) shall be contingent on documented energy production and
sales from the renewable energy system to a third party.
(3)The
total net present value of a production-based incentive may not exceed the
lower of—
(A)25 percent of the
eligible project costs; and
(B)any other limits
that the Secretary establishes by rule or guidance.
(f)
(1)The Secretary may provide assistance to eligible
applicants to conduct feasibility studies of projects for which assistance may
be provided under this section.
(2)The
Secretary shall use not more than 10 percent of funds made available to carry
out this section to provide assistance described in paragraph (1).
(3)The
Secretary shall, by regulation, establish criteria for the receipt of
assistance under this subsection.
(4)Avoidance of
duplicative assistanceAn applicant that receives assistance to
carry out a feasibility study for a project under this subsection shall not be
eligible for assistance to carry out a feasibility study for the project under
any other provision of Federal law.
(5)A recipient of funds under this subsection shall contribute
an amount of non-Federal funds that is at least equal to 75 percent of the
amount of Federal funds received.
(g)
(1)The Secretary shall make competitive grants to eligible
entities to provide rebates for farmers, ranchers, rural school districts, and
rural small businesses to purchase renewable energy systems and make energy
efficiency improvements.
(2)To be eligible to receive a grant under paragraph (1),
an entity shall be—
(A)a State energy or
agriculture office;
(B)a nonprofit
State-based energy efficiency or renewable energy organization that uses public
funds provided directly or under contract with a State agency;
(C)any other
nonprofit organization with a demonstrated ability to administer a State-wide
energy efficiency or renewable energy rebate program; or
(D)a consortium of
entities described in subparagraphs (A) through (C).
(3)
(A)The Secretary shall establish a merit review process to
review applications for grants under paragraph (1) that uses the expertise of
the Department of Agriculture, other Federal and State agencies, and
non-governmental organizations.
(B)In
reviewing the application of an eligible entity to receive a grant under
paragraph (1), the Secretary shall consider—
(i)the experience
and expertise of the entity in establishing and administering a State-wide
clean energy rebate program;
(ii)the annual
projected energy savings or production increases resulting from the proposed
program;
(iii)the
environmental benefits resulting from the proposed program; and
(iv)other
appropriate factors, as determined by the Secretary.
(4)An entity that receives a grant under paragraph (1) shall
provide assurances to the Secretary that funds provided to the entity under
this subsection will be used to supplement, not to supplant, the amount of
Federal, State, and local funds otherwise expended for rebate programs.
(5)The amount of a rebate provided from a grant under this
subsection shall not exceed the lower of—
(A)$10,000;
or
(B)50 percent of the
cost incurred to purchase a renewable energy system or an energy efficiency
improvement.
;
and
(6)by adding at the
end the following:
(i)Of
the funds of the Commodity Credit Corporation, the Secretary shall make
available to carry out this section—
(1)$60,000,000 for
fiscal year 2008, to remain available until expended, of which not more than
$12,000,000 shall be used to carry out subsection (g);
(2)$90,000,000 for
fiscal year 2009, to remain available until expended, of which not more than
$18,000,000 shall be used to carry out subsection (g);
(3)$130,000,000 for
fiscal year 2010, to remain available until expended, of which not more than
$26,000,000 shall be used to carry out subsection (g);
(4)$180,000,000 for
fiscal year 2011, to remain available until expended, of which not more than
$36,000,000 shall be used to carry out subsection (g); and
(5)$250,000,000 for
fiscal year 2012, to remain available until expended, of which not more than
$50,000,000 shall be used to carry out subsection
(g).
.
4.Sense of the
Senate on a direct loan program in section 9006It is the sense of the Senate that—
(1)as authorized by section 9006 of the Farm
Security and Rural Investment Act of 2002 (7 U.S.C. 8106), the Secretary of
Agriculture should implement a direct loan program to complement the grants
provided under that section; and
(2)as appropriate, the Secretary should model
the direct loan program on the loan program established under section 503 of
the Small Business Investment Act of 1958 (15 U.S.C. 697).