1.Short
title; table of contents
(a)This Act may be cited
as the National Fuels Initiative
.
(b)The table of
contents of this Act is as follows:
Sec. 1. Short title; table of
contents.
Sec. 2. Findings.
Sec. 3. Declaration of United States policy on the development
and use of renewable alternative fuels.
Sec. 4. Modification to alcohol credit and alternative fuel
credit.
Sec. 5. Installation of E–85 fuel pumps by major oil companies
at owned stations and branded stations.
Sec. 6. Requirement to manufacture dual fueled
automobiles.
Sec. 7. Definition of automobile.
Sec. 8. Average fuel economy standards.
Sec. 9. Credit trading and compliance.
Sec. 10. Consumer tax credit.
Sec. 11. Advanced technology motor vehicles manufacturing
credit.
2.Congress makes the following
findings:
(1)The national
security and economic prosperity of the United States is threatened by our oil
dependence, and the reliance of the United States on oil imports impinges on
our foreign policy. Adversarial regimes rich in oil and natural gas are using
their energy supplies as leverage against import-dependent countries and are
using increased revenues from oil and gas exports to gain international
influence, fund anti-American appeals, entrench authoritarianism, and support
terrorism.
(2)Global
competition for oil reserves is increasing as supply is depleted, demand
increases, and foreign governments attempt to exert more control over reserves.
Supplies of oil are vulnerable to disruption resulting from war, political
manipulation, natural disasters, and terrorist attacks. A major loss in oil
supply could result in a price shock extremely damaging to the economy of the
United States and our way of life, and competition over scarce resources could
create conflict.
(3)Inefficient and
unclean use of oil damages the environment and worsens the threat of global
climate change.
3.Declaration of
United States policy on the development and use of renewable alternative
fuelsCongress declares
that:
(1)It is the policy
of the United States to reduce dependence on imported oil through increased
efficiency and diversification of fuel sources through dramatically expanded
use of clean alternative fuels. Such a reduction will increase the foreign
policy flexibility of the United States, make the United States less vulnerable
to oil supply disruption, and promote economic growth. The United States will
continue to promote research and development of a range of alternatives fuels,
and it will implement policies to accelerate the deployment and
commercialization of existing efficiency and alternative fuels
technologies.
(2)It is the policy
goal of the United States to produce and utilize the equivalent of at least
100,000,000,000 gallons of renewable fuel per year by 2025. This amount of
renewable fuel, along with innovation in fuel efficiency, will substantially
reduce the need for oil imports in the United States.
(3)It is the policy
of the United States to promote the development of a global biofuels market
through partnerships with other nations and to reduce trade barriers for
renewable fuels.
4.Modification to
alcohol credit and alternative fuel credit
(a)Income tax
credit for alcohol
(1)Rate based on
price of oilSection 40 of the Internal Revenue Code of 1986
(relating to alcohol used as fuel) is amended by striking 60
cents
each place it appears and inserting the applicable
amount
.
(2)Subsection (h) of section 40 of such Code is amended to
read as follows:
(h)
(1)For purposes of this section, the term applicable
amount means, with respect to any quarter—
(A)$.05 for each $1
(or any fraction thereof) by which $45 exceeds—
(i)in the case of
the alcohol mixture credit, the average price of a barrel of oil for the
quarter during which the qualified mixture in which the alcohol was used is
sold or used, and
(ii)in the case of
the alcohol credit, the average price of a barrel of oil for the quarter during
which the alcohol was sold or used, and
(B)$0 for any
quarter in which the price of a barrel of oil is greater than $45.
(2)Determination
of average priceThe average price of a barrel of oil shall be
determined under regulations prescribed by the Secretary.
(3)For
purposes of this subsection, the term barrel means 42 United
States
gallons.
.
(3)Elimination of
small ethanol producer credit
(A)Section 40(a) of
such Code is amended—
(i)by
striking , plus
at the end of paragraph (2) and inserting a
period, and
(ii)by
striking paragraph (3).
(B)Section 40(b) of
such Code is amended by striking paragraph (4) and by redesignating paragraph
(5) as paragraph (4).
(C)(i)Section 40(d)(3) of
such Code is amended by striking subparagraph (C) and redesignating
subparagraph (D) as subparagraph (C).
(ii)Section 40(d)(3)(C) of such Code,
as redesignated by clause (i), is amended by striking subparagraph (A),
(B), or (C)
and inserting subparagraph (A) or
(C)
.
(D)Section 40 of
such Code is amended by striking subsection (g) and by redesignating subsection
(h), as amended by paragraph (2), as subsection (g).
(4)Paragraph (1) of section 40(e) of such Code is
amended—
(A)in subparagraph
(A), by striking 2010
and inserting 2020
,
and
(B)in subparagraph
(B), by striking 2011
and inserting 2021
.
(5)Section 40(b) of such Code, as amended by subsection
(a), is amended by striking paragraph (3) and by redesignating paragraph (4) as
paragraph (3).
(b)Modifications
to excise tax credit and payments for alcohol
(1)Paragraph (2) of section 6426(b) of the Internal Revenue
Code of 1986 is amended to read as follows:
(2)For purposes of this subsection, the applicable amount
shall be the amount determined under section
40(g).
.
(2)
(A)Alcohol fuel
mixture creditParagraph (5) of section 6426(b) of such Code is
amended by striking 2010
and inserting
2020
.
(B)Subparagraph
(A) of section 6427(e)(5) of such Code is amended by striking
2010
and inserting 2020
.
(c)Modifications
to excise tax and payments for alternative fuel
(1)
(A)
(i)Paragraph (1) of section 6426(d) of the Internal Revenue
Code of 1986 is amended by striking 50 cents
and inserting
the applicable amount
.
(ii)Subsection (d) of section 6426 of such Code is amended by
redesignating paragraphs (2), (3), and (4) as paragraphs (3), (4), and (5),
respectively, and by inserting after paragraph (1) the following new
paragraph:
(2)For purposes of this subsection, the
applicable amount shall be the amount determined under section
40(g).
.
(B)Paragraph
(5) of section 6426(d) of such Code, as redesignated by paragraph (1), is
amended by striking 2009 (September 30, 2014, in the case of any sale or
use involving liquified hydrogen)
and inserting
2020
.
(2)Alternative
fuel mixture credit
(A)
(i)Paragraph (1) of section 6426(e) of the Internal Revenue
Code of 1986 is amended by striking 50 cents
and inserting
the applicable amount
.
(ii)Subsection (e) of section 6426 of such Code is amended by
redesignating paragraphs (2) and (3) as paragraphs (3) and (4), respectively,
and by inserting after paragraph (1) the following new paragraph:
(2)For purposes of this subsection, the
applicable amount shall be the amount determined under section
40(g).
.
(B)Paragraph
(4) of section 6426(e) of such Code, as redesignated by paragraph (1), is
amended by striking 2009 (September 30, 2014, in the case of any sal or
use involving liquified hydrogen)
and inserting
2020
.
(3)Paragraph
(5) of section 6427(e) is amended by inserting and
at the end of
subparagraph (B), by striking subparagraphs (C) and (D), and by inserting after
subparagraph (B) the following:
(C)any alternative
fuel or alternative fuel mixture (as defined in subsection (d)(3) or (e)(3) of
section 6426) sold or used after September 30,
2020.
.
(d)The amendments made by this section shall apply to fuel used
or sold in quarters beginning after the date of the enactment of this
Act.
5.Installation of E–85
fuel pumps by major oil companies at owned stations and branded
stationsSection 211(o) of the
Clean Air Act (42 U.S.C. 7545(o)) is amended by adding at the end the
following:
(11)Installation
of E–85 fuel pumps by major oil companies at owned stations and branded
stations
(A)In
this paragraph:
(i)The term E–85 fuel means a blend of gasoline
approximately 85 percent of the content of which is derived from ethanol
produced in the United States.
(ii)The term major oil company means any person
that, individually or together with any other person with respect to which the
person has an affiliate relationship or significant ownership interest, has not
less than 4,500 retail station outlets according to the latest publication of
the Petroleum News Annual Factbook.
(iii)The
term Secretary means the Secretary of Energy, acting in
consultation with the Administrator of the Environmental Protection Agency and
the Secretary of Agriculture.
(B)The
Secretary shall promulgate regulations to ensure that each major oil company
that sells or introduces gasoline into commerce in the United States through
wholly-owned stations or branded stations installs or otherwise makes available
1 or more pumps that dispense E–85 fuel (including any other equipment
necessary, such as including tanks, to ensure that the pumps function properly)
at not less than the applicable percentage of the wholly-owned stations and the
branded stations of the major oil company specified in subparagraph (C).
(C)For the purpose of subparagraph (B), the applicable
percentage of the wholly-owned stations and the branded stations shall be
determined in accordance with the following table:
Calendar
year:Applicable percentage of wholly-owned stations and branded
stations (percent):
20085
200910
201015
201120
201225
201330
201435
201540
201645
2017 and each calendar year
thereafter50.
(D)
(i)Subject to clause (ii), in promulgating regulations under
subparagraph (B), the Secretary shall ensure that each major oil company
described in subparagraph (B) installs or otherwise makes available 1 or more
pumps that dispense E–85 fuel at not less than a minimum percentage (specified
in the regulations) of the wholly-owned stations and the branded stations of
the major oil company in each State.
(ii)In
specifying the minimum percentage under clause (i), the Secretary shall ensure
that each major oil company installs or otherwise makes available 1 or more
pumps described in that clause in each State in which the major oil company
operates.
(E)In promulgating regulations under subparagraph
(B), the Secretary shall ensure that each major oil company described in that
subparagraph assumes full financial responsibility for the costs of installing
or otherwise making available the pumps described in that subparagraph and any
other equipment necessary (including tanks) to ensure that the pumps function
properly.
(F)Production
credits for exceeding E–85 fuel pumps installation requirement
(i)Earning and
period for applying creditsIf the percentage of the wholly-owned
stations and the branded stations of a major oil company at which the major oil
company installs E–85 fuel pumps in a particular calendar year exceeds the
percentage required under subparagraph (C), the major oil company earns credits
under this paragraph, which may be applied to any of the 3 consecutive calendar
years immediately after the calendar year for which the credits are
earned.
(ii)Subject to clause (iii), a major oil company that has
earned credits under clause (i) may sell credits to another major oil company
to enable the purchaser to meet the requirement under subparagraph (C).
(iii)A
major oil company may not use credits purchased under clause (ii) to fulfill
the geographic distribution requirement in subparagraph
(D).
.
6.Requirement to
manufacture dual fueled automobiles
(a)
(1)Chapter 329 of title 49, United States Code, is amended
by inserting after section 32902 the following:
32902A.Requirement
to manufacture dual fueled automobiles
(a)Each
manufacturer of new automobiles that are capable of operating on gasoline or
diesel fuel shall ensure that the percentage of such automobiles, manufactured
in any model year after model year 2007 and distributed in commerce for sale in
the United States, which are dual fueled automobiles is equal to not less than
the applicable percentage set forth in the following table:
For the
model year:The percentage of dual fueled automobiles manufactured shall
be not less than:
200810 percent
200920 percent
201030 percent
201140 percent
101250 percent
201360 percent
201470 percent
201580 percent
201690 percent
2017 and beyond100 percent
(b)Production
credits for exceeding flexible fuel automobile production requirement
(1)Earning and
period for applying creditsIf the number of dual fueled
automobiles manufactured by a manufacturer in a particular model year exceeds
the number required under subsection (a), the manufacturer earns credits under
this section, which may be applied to any of the 3 consecutive model years
immediately after the model year for which such credits are earned.
(2)A manufacturer that has earned credits under paragraph
(1) may sell credits to another manufacturer to enable the purchaser to meet
the requirement under subsection
(a).
.
(2)The table of sections for chapter 329 of title 49,
United States Code, is amended by inserting after the item relating to section
32902 the following:
32902A. Requirement to
manufacture dual fueled
automobiles.
.
(b)Activities to
promote the use of certain alternative fuelsThe Secretary of
Transportation shall carry out activities to promote the use of fuel mixtures
containing gasoline or diesel fuel and 1 or more alternative fuels, including a
mixture containing at least 85 percent of methanol, denatured ethanol, and
other alcohols by volume with gasoline or other fuels, to power automobiles in
the United States.
7.
(a)Section 32901(a)(3) of title 49, United States Code, is
amended by striking rated at—
and all that follows through the
period at the end and inserting rated at not more than 10,000 pounds
gross vehicle weight.
.
(b)Section 32908(a) of title 49, United States Code, is
amended, by striking section—
and all that follows through
(2)
and inserting section, the term
.
(c)The amendments made by this section shall apply to model
year 2009 and each subsequent model year.
8.Average fuel
economy standards
(a)Section 32902 of title 49, United States
Code, is amended—
(1)in subsection
(a)—
(A)in the header, by
inserting manufactured
before model year 2012
after Non-passenger
automobiles
; and
(B)by adding at the
end the following: This subsection shall not apply to automobiles
manufactured after model year 2011.
;
(2)in subsection
(b)—
(A)in the header, by
inserting manufactured
before model year 2012
after Passenger
automobiles
;
(B)by inserting
and before model year 2009
after 1984
; and
(C)by adding at the
end the following: Such standard shall be increased by 4 percent per
year for model years 2009 through 2011 (rounded to the nearest 1/10 mile per
gallon)
;
(3)by amending
subsection (c) to read as follows:
(c)Automobiles
manufactured after model year 2011(1)Not later than 18
months before the beginning of each model year after model year 2011, the
Secretary of Transportation shall prescribe, by regulation—
(A)an average fuel economy standard for
automobiles manufactured by a manufacturer in that model year; or
(B)based on 1 or more vehicle attributes
that relate to fuel economy—
(i)separate standards for different
classes of automobiles; or
(ii)standards expressed in the form of
a mathematical function.
(2)(A)Except as provided
under paragraphs (3) and (4) and subsection (d), standards under paragraph (1)
shall attain a projected aggregate level of average fuel economy of 27.5 miles
per gallon for all automobiles manufactured by all manufacturers for model year
2012.
(B)The projected aggregate level of
average fuel economy for model year 2013 and each succeeding model year shall
be increased by 4 percent from the level for the prior model year (rounded to
the nearest 1/10 mile per gallon).
(C)Notwithstanding subparagraphs (A) and
(B), the fleetwide average fuel economy standard for passenger automobiles
manufactured by a manufacturer in a model year for that manufacturer’s domestic
fleet and for its foreign fleet as calculated under section 32904 as in effect
before the date of enactment of the National
Fuels Initiative shall not be less than 92 percent of the average
fuel economy projected by the Secretary for the combined domestic and foreign
fleets manufactured by all manufacturers in that model year.
(3)If the actual aggregate level of
average fuel economy achieved by manufacturers for each of 3 consecutive model
years is at least 5 percent less than the projected aggregate level of average
fuel economy for such model year, the Secretary shall make appropriate
adjustments to the standards prescribed under this subsection.
(4)(A)Notwithstanding
paragraphs (1) through (3) and subsection (b), the Secretary of Transportation
may prescribe a lower average fuel economy standard for 1 or more model years
if the Secretary of Transportation, in consultation with the Secretary of
Energy, determines that the minimum standards prescribed under paragraph (2) or
(3) or subsection (b) for each model year—
(i)are technologically
unachievable;
(ii)cannot be achieved without materially
reducing the overall safety of automobiles manufactured or sold in the United
States; or
(iii)is shown, by clear and convincing
evidence, not to be cost effective.
(B)If a lower standard is prescribed for
a model year under subparagraph (A), such standard shall be the maximum
standard that—
(i)is technologically achievable;
(ii)can be achieved without materially
reducing the overall safety of automobiles manufactured or sold in the United
States; and
(iii)is cost effective.
(5)In determining cost effectiveness
under paragraph (4)(A)(iii), the Secretary of Transportation shall take into
account the total value to the Nation of reduced petroleum use, including the
value of reducing external costs of petroleum use, using a value for such costs
equal to 50 percent of the value of a gallon of gasoline saved or the amount
determined in an analysis of the external costs of petroleum use that
considers—
(A)value to consumers;
(B)economic security;
(C)national security;
(D)foreign policy;
(E)the impact of oil use—
(i)on sustained cartel rents paid to
foreign suppliers;
(ii)on long-run potential gross
domestic product due to higher normal-market oil price levels, including
inflationary impacts;
(iii)on import costs, wealth
transfers, and potential gross domestic product due to increased trade
imbalances;
(iv)on import costs and wealth
transfers during oil shocks;
(v)on macroeconomic dislocation and
adjustment costs during oil shocks;
(vi)on the cost of existing energy
security policies, including the management of the Strategic Petroleum
Reserve;
(vii)on the timing and severity of the
oil peaking problem;
(viii)on the risk, probability, size,
and duration of oil supply disruptions;
(ix)on OPEC strategic behavior and
long-run oil pricing;
(x)on the short term elasticity of
energy demand and the magnitude of price increases resulting from a supply
shock;
(xi)on oil imports, military costs,
and related security costs, including intelligence, homeland security, sea lane
security and infrastructure, and other military activities;
(xii)on oil imports, diplomatic and
foreign policy flexibility, and connections to geopolitical strife, terrorism,
and international development activities;
(xiii)all relevant environmental
hazards under the jurisdiction of the Environmental Protection Agency;
and
(xiv)on well-to-wheels urban and local
air emissions of pollutants
and their uninternalized
costs;
(F)the impact of the oil or energy
intensity of the United States economy on the sensitivity of the economy to oil
price changes, including the magnitude of gross domestic product losses in
response to short term price shocks or long term price increases;
(G)the impact of United States payments
for oil imports on political, economic, and military developments in unstable
or unfriendly oil exporting countries;
(H)the uninternalized costs of pipeline
and storage oil seepage, and for risk of oil spills from production, handling,
and transport, and related landscape damage; and
(I)additional relevant factors, as
determined by the Secretary.
(6)When considering the value to
consumers of a gallon of gasoline saved, the Secretary of Transportation may
not use a value less than the greatest of—
(A)the average national cost of a gallon
of gasoline sold in the United States during the 12-month period ending on the
date on which the new fuel economy standard is proposed;
(B)the most recent weekly estimate by the
Energy Information Administration of the Department of Energy of the average
national cost of a gallon of gasoline (all grades) sold in the United States;
or
(C)the gasoline prices projected by the
Energy Information Administration for the 20-year period beginning in the year
following the year in which the standards are established.
(7)In prescribing standards under this
subsection, the Secretary may prescribe standards for 1 or more model
years.
(8)(A)Not later than December
31, 2016, the Secretary of Transportation, the Secretary of Energy, and the
Administrator of the Environmental Protection Agency shall submit a joint
report to Congress on the state of global automotive efficiency technology
development, and on the accuracy of tests used to measure fuel economy of
automobiles under section 32904(c), utilizing the study and assessment of the
National Academy of Sciences referred to in subparagraph (B).
(B)The Secretary shall enter into
appropriate arrangements with the National Academy of Sciences to conduct a
comprehensive study of the technological opportunities to enhance fuel economy
and an analysis and assessment of the accuracy of fuel economy tests used by
the Administrator of the Environmental Protection Agency to measure fuel
economy for each model under section 32904(c). Such analysis and assessment
shall identify any additional factors or methods that should be included in
tests to measure fuel economy for each model to more accurately reflect actual
fuel economy of automobiles. The Secretary and the Administrator of the
Environmental Protection Agency shall furnish, at the request of the Academy,
any information which the Academy determines to be necessary to conduct the
study, analysis, and assessment under this subparagraph.
(C)The report submitted under
subparagraph (A) shall include—
(i)the study of the National Academy of
Sciences referred to in subparagraph (B); and
(ii)an assessment by the Secretary of
technological opportunities to enhance fuel economy and opportunities to
increase overall fleet safety.
(D)The report submitted under
subparagraph (A) shall identify and examine additional opportunities to reform
the regulatory structure under this chapter, including approaches that seek to
merge vehicle and fuel requirements into a single system that achieves equal or
greater reduction in petroleum use and environmental benefits.
(E)The report submitted under
subparagraph (A) shall—
(i)include conclusions reached by the
Administrator of the Environmental Protection Agency, as a result of detailed
analysis and public comment, on the accuracy of current fuel economy
tests;
(ii)identify any additional factors that
the Administrator determines should be included in tests to measure fuel
economy for each model to more accurately reflect actual fuel economy of
automobiles; and
(iii)include a description of options,
formulated by the Secretary and the Administrator, to incorporate such
additional factors in fuel economy tests in a manner that will not effectively
increase or decrease average fuel economy for any automobile
manufacturer.
(F)There is authorized to be
appropriated to the Secretary such amounts as are required to carry out the
study, analysis, and assessment required by subparagraph
(B).
;
and
(4)in subsection
(g)(2), by striking (and submit the amendment to Congress when required
under subsection (c)(2) of this section)
.
(b)
(1)Chapter 329 of title 49, United States Code, is
amended—
(A)in section
32903—
(i)by
striking passenger
each place it appears;
(ii)by
striking section 32902(b)–(d) of this title
each place it
appears and inserting subsection (c) or (d) of section
32902
;
(iii)by striking
subsection (e); and
(iv)by
redesignating subsection (f) as subsection (e); and
(B)in section
32904(a)—
(i)by
striking passenger
each place it appears; and
(ii)in
paragraph (1), by striking subject to
and all that follows
through section 32902(b)–(d) of this title
and inserting
subsection (c) or (d) of section 32902
.
(2)The amendments made by paragraph (1) shall apply to
automobiles manufactured after model year 2011.
9.Credit trading
and compliance
(a)Section 32903(a) of title 49, United States Code, is
amended—
(1)by inserting
Credits earned by a manufacturer under this section may be sold to any
other manufacturer and used as if earned by that manufacturer; except that
credits earned by a manufacturer described in section 32904(b)(1)(A)(i) may not
be sold to or purchased by a manufacturer described in
32904(b)(1)(A)(ii),
after earns credits.
; and
(2)by striking
3 consecutive model years immediately
each place it appears and
inserting model years
.
(b)
(1)Section 32904(b) is amended by striking
passenger
each place it appears.
(2)The
amendments made by paragraph (1) shall apply to automobiles manufactured after
model year 2011.
(c)Multi-year
compliance periodSection 32904(c) of such title is
amended—
(1)by inserting
(1)
before The Administrator
; and
(2)by adding at the
end the following:
(2)The Secretary, by rule, may allow a
manufacturer to elect a multi-year compliance period of not more than 4
consecutive model years in lieu of the single model year compliance period
otherwise applicable under this
chapter.
.
10.
(a)Elimination on
number of new qualified hybrid and advanced lean burn technology vehicles
eligible for alternative motor vehicle credit
(1)Section 30B of the
Internal Revenue Code of 1986 is amended—
(A)by striking subsection (f); and
(B)by redesignating subsections (g) through
(j) as subsections (f) through (i), respectively.
(2)
(A)Paragraphs (4) and (6) of section 30B(h) of
such Code are each amended by striking (determined without regard to
subsection (g))
and inserting determined without regard to
subsection (f))
.
(B)Section 38(b)(25) of such Code is amended
by striking section 30B(g)(1)
and inserting section
30B(f)(1)
.
(C)Section 55(c)(2) of such Code is amended by
striking section 30B(g)(2)
and inserting section
30B(f)(2)
.
(D)Section 1016(a)(36) of such Code is amended
by striking section 30B(h)(4)
and inserting section
30B(g)(4)
.
(E)Section 6501(m) of such Code is amended by
striking section 30B(h)(9)
and inserting section
30B(g)(9)
.
(b)Extension of
alternative vehicle credit for new qualified hybrid motor
vehiclesParagraph (3) of
section 30B(i) of such Code (as redesignated by subsection (a)) is amended by
striking December 31, 2009
and inserting December 31,
2010
.
(c)The amendments made by
this section shall apply to property placed in service after December 31, 2005,
in taxable years ending after such date.
11.Advanced technology
motor vehicles manufacturing credit
(a)Subpart B of part IV
of subchapter A of chapter 1 of the Internal Revenue Code of 1986 (relating to
foreign tax credit, etc.) is amended by adding at the end the following new
section:
30D.Advanced technology
motor vehicles manufacturing credit
(a)There shall be
allowed as a credit against the tax imposed by this chapter for the taxable
year an amount equal to 35 percent of the qualified investment of an eligible
taxpayer for such taxable year.
(b)For purposes of
this section—
(1)The qualified
investment for any taxable year is equal to the incremental costs incurred
during such taxable year—
(A)to re-equip, expand, or establish any
manufacturing facility in the United States of the eligible taxpayer to produce
advanced technology motor vehicles or to produce eligible components,
(B)for engineering integration performed in
the United States of such vehicles and components as described in subsection
(d),
(C)for research and development performed in
the United States related to advanced technology motor vehicles and eligible
components, and
(D)for employee
retraining with respect to the manufacturing of such vehicles or components
(determined without regard to wages or salaries of such retrained
employees).
(2)In the event a facility
of the eligible taxpayer produces both advanced technology motor vehicles and
conventional motor vehicles, or eligible and non-eligible components, only the
qualified investment attributable to production of advanced technology motor
vehicles and eligible components shall be taken into account.
(c)In this section:
(1)Advanced
technology motor vehicleThe term advanced technology motor
vehicle means—
(A)any qualified
electric vehicle (as defined in section 30(c)(1)),
(B)any new qualified
fuel cell motor vehicle (as defined in section 30B(b)(3)),
(C)any new advanced
lean burn technology motor vehicle (as defined in section 30B(c)(3)),
(D)any new qualified
hybrid motor vehicle (as defined in section 30B(d)(2)(A) and determined without
regard to any gross vehicle weight rating),
(E)any new qualified
alternative fuel motor vehicle (as defined in section 30B(e)(4), including any
mixed-fuel vehicle (as defined in section 30B(e)(5)(B)), and
(F)any other motor
vehicle using electric drive transportation technology (as defined in paragraph
(3)).
(2)Electric drive
transportation technologyThe term electric drive
transportation technology means technology used by vehicles that use an
electric motor for all or part of their motive power and that may or may not
use off-board electricity, such as battery electric vehicles, fuel cell
vehicles, engine dominant hybrid electric vehicles, plug-in hybrid electric
vehicles, and plug-in hybrid fuel cell vehicles.
(3)The term
eligible component means any component inherent to any advanced
technology motor vehicle, including—
(A)with respect to any gasoline or
diesel-electric new qualified hybrid motor vehicle—
(i)electric motor or generator;
(ii)power split device;
(iii)power control unit;
(iv)power controls;
(v)integrated starter generator; or
(vi)battery;
(B)with respect to any hydraulic new qualified
hybrid motor vehicle—
(i)accumulator or other energy storage
device;
(ii)hydraulic pump;
(iii)hydraulic pump-motor assembly;
(iv)power control
unit; and
(v)power
controls;
(C)with respect to any new advanced lean burn
technology motor vehicle—
(i)diesel engine;
(ii)turbo charger;
(iii)fuel injection system; or
(iv)after-treatment system, such as a particle
filter or NOx absorber; and
(D)with respect to any advanced technology
motor vehicle, any other component submitted for approval by the
Secretary.
(4)The term
eligible taxpayer means any taxpayer if more than 20 percent of
the taxpayer’s gross receipts for the taxable year is derived from the
manufacture of motor vehicles or any component parts of such vehicles.
(d)Engineering
integration costsFor
purposes of subsection (b)(1)(B), costs for engineering integration are costs
incurred prior to the market introduction of advanced technology vehicles for
engineering tasks related to—
(1)establishing functional, structural, and
performance requirements for component and subsystems to meet overall vehicle
objectives for a specific application,
(2)designing interfaces for components and
subsystems with mating systems within a specific vehicle application,
(3)designing cost effective, efficient, and
reliable manufacturing processes to produce components and subsystems for a
specific vehicle application, and
(4)validating functionality and performance of
components and subsystems for a specific vehicle application.
(e)Limitation
based on amount of taxThe
credit allowed under subsection (a) for the taxable year shall not exceed the
excess of—
(1)the sum of—
(A)the regular tax liability (as defined in
section 26(b)) for such taxable year, plus
(B)the tax imposed by section 55 for such
taxable year and any prior taxable year beginning after 1986 and not taken into
account under section 53 for any prior taxable year, over
(2)the sum of the credits allowable under
subpart A and sections 27, 30, and 30B for the taxable year.
(f)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 paragraph) result from such expenditure shall be reduced by the
amount of the credit so allowed.
(g)
(1)Coordination
with other deductions and creditsExcept as provided in paragraph (2), the
amount of any deduction or other credit allowable under this chapter for any
cost taken into account in determining the amount of the credit under
subsection (a) shall be reduced by the amount of such credit attributable to
such cost.
(2)Research and
development costs
(A)Except as provided in
subparagraph (B), any amount described in subsection (b)(1)(C) taken into
account in determining the amount of the credit under subsection (a) for any
taxable year shall not be taken into account for purposes of determining the
credit under section 41 for such taxable year.
(B)Costs taken
into account in determining base period research expensesAny amounts described in subsection
(b)(1)(C) taken into account in determining the amount of the credit under
subsection (a) for any taxable year which are qualified research expenses
(within the meaning of section 41(b)) shall be taken into account in
determining base period research expenses for purposes of applying section 41
to subsequent taxable years.
(h)Business
carryovers allowedIf the
credit allowable under subsection (a) for a taxable year exceeds the limitation
under subsection (e) for such taxable year, such excess (to the extent of the
credit allowable with respect to property subject to the allowance for
depreciation) shall be allowed as a credit carryback to each of the 15 taxable
years immediately preceding the unused credit year and as a carryforward to
each of the 20 taxable years immediately following the unused credit
year.
(i)For purposes of this
section, rules similar to the rules of section 179A(e)(4) and paragraphs (1)
and (2) of section 41(f) shall apply
(j)Election not to
take creditNo credit shall
be allowed under subsection (a) for any property if the taxpayer elects not to
have this section apply to such property.
(k)The Secretary shall prescribe such
regulations as necessary to carry out the provisions of this section.
(l)This section shall not apply to any
qualified investment after December 31,
2010.
.
(b)
(1)Section 1016(a) of the Internal Revenue
Code of 1986 is amended by striking and
at the end of paragraph
(36), by striking the period at the end of paragraph (37) and inserting
, and
, and by adding at the end the following new
paragraph:
(38)to the extent provided in section
30D(g).
.
(2)Section 6501(m) of such Code is amended by
inserting 30D(k),
after 30C(e)(5),
.
(3)The table of sections for subpart B of part
IV of subchapter A of chapter 1 of such Code is amended by inserting after the
item relating to section 30C the following new item:
Sec. 30D. Advanced technology
motor vehicles manufacturing
credit.
.
(c)The amendments made by
this section shall apply to amounts incurred in taxable years beginning after
December 31, 1999.