[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6544 Introduced in House (IH)]







110th CONGRESS
  2d Session
                                H. R. 6544

   To provide immediate relief from high fuel and food prices and to 
                pursue alternatives in renewable energy.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             July 17, 2008

Mr. Burton of Indiana introduced the following bill; which was referred 
 to the Committee on Ways and Means, and in addition to the Committees 
on Energy and Commerce, Natural Resources, Armed Services, and Science 
   and Technology, for a period to be subsequently determined by the 
  Speaker, in each case for consideration of such provisions as fall 
           within the jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL


 
   To provide immediate relief from high fuel and food prices and to 
                pursue alternatives in renewable energy.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Relief Now on the 
Road to Renewable Energy Act of 2008''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Findings.
                          TITLE I--REFINERIES

                       Subtitle A--Tax Incentives

Sec. 101. Issuance of guidance.
Sec. 102. Tax-exempt financing of domestic use oil refinery facilities.
Sec. 103. Designation and availability of Federal lands for oil and 
                            natural gas refineries.
               Subtitle B--Availability of Federal Lands

Sec. 111. Definitions.
Sec. 112. State participation and presidential designation.
Sec. 113. Process coordination and rules of procedure.
Sec. 114. Alternative uses of land.
                        TITLE II--NUCLEAR ENERGY

Sec. 201. Waste confidence.
Sec. 202. ASME Nuclear Certification credit.
                          TITLE III--DRILLING

                       Subtitle A--Tax Provisions

Sec. 301. Credit for producing fuel from nonconventional sources to 
                            apply to gas produced onshore from 
                            formations more than 15,000 feet deep.
Sec. 302. Tax credit for carbon dioxide captured from industrial 
                            sources and used in enhanced oil and 
                            natural gas recovery.
   Subtitle B--Termination of Congressional Moratoria on Oil and Gas 
               Development on the Outer Continental Shelf

Sec. 311. Termination of laws prohibiting expenditures for oil and 
                            natural gas leasing and preleasing 
                            activities regarding areas of the outer 
                            continental shelf.
   Subtitle C--Oil and Gas Development on the Coastal Plain of Alaska

Sec. 321. Short title.
Sec. 322. Definitions.
Sec. 323. Leasing program for lands within the Coastal Plain.
Sec. 324. Lease sales.
Sec. 325. Grant of leases by the Secretary.
Sec. 326. Lease terms and conditions.
Sec. 327. Coastal plain environmental protection.
Sec. 328. Expedited judicial review.
Sec. 329. Federal and State distribution of revenues.
Sec. 330. Rights-of-way across the Coastal Plain.
Sec. 331. Conveyance.
Sec. 332. Local government impact aid and community service assistance.
       TITLE IV--GAS PRICE TAX CREDIT FOR FAMILIES AND BUSINESSES

Sec. 401. Deduction for certain commuting expenses of individuals.
Sec. 402. Tax credit for fuel expenses of truckers.
                      TITLE V--COAL-TO-LIQUID FUEL

               Subtitle A--Coal to Liquid Fuel Activities

Sec. 501. Short title.
Sec. 502. Definitions.
Sec. 503. Coal-to-liquid fuel loan guarantee program.
Sec. 504. Coal-to-liquid facilities loan program.
Sec. 505. Location of coal-to-liquid manufacturing facilities.
Sec. 506. Strategic Petroleum Reserve.
Sec. 507. Authorization to conduct research, development, testing, and 
                            evaluation of assured domestic fuels.
Sec. 508. Coal-to-liquid long-term fuel procurement and department of 
                            defense development.
Sec. 509. Report on emissions of Fischer-Tropsch products used as 
                            transportation fuels.
      Subtitle B--Amendments to the Internal Revenue Code of 1986

Sec. 511. Credit for investment in coal-to-liquid fuels projects.
Sec. 512. Temporary expensing for equipment used in coal-to-liquid 
                            fuels process.
Sec. 513. Extension of alternative fuel credit for fuel derived from 
                            coal through the Fischer-Tropsch process.
Sec. 514. Modifications to enhanced oil recovery credit.
Sec. 515. Allowance of enhanced oil, natural gas, and coalbed methane 
                            recovery, and capture and sequestration 
                            credit against the alternative minimum tax.
           TITLE VI--ENERGY EFFICIENT TAX CREDIT FOR VEHICLES

Sec. 601. Credit for hybrids and plug-in hybrids.
        TITLE VII--EXTENSION AND MODIFICATION OF TAX PROVISIONS

Sec. 700. Short title; etc.
      Subtitle A--Extension of Clean Energy Production Incentives

Sec. 701. Extension and modification of renewable energy production tax 
                            credit.
Sec. 702. Extension and modification of solar energy and fuel cell 
                            investment tax credit.
Sec. 703. Extension and modification of residential energy efficient 
                            property credit.
Sec. 704. Extension and modification of credit for clean renewable 
                            energy bonds.
Sec. 705. Extension of special rule to implement FERC restructuring 
                            policy.
Sec. 706. Extension of wind production tax credit.
    Subtitle B--Extension of Incentives To Improve Energy Efficiency

Sec. 711. Extension and modification of credit for energy efficiency 
                            improvements to existing homes.
Sec. 712. Extension and modification of tax credit for energy efficient 
                            new homes.
Sec. 713. Extension and modification of energy efficient commercial 
                            buildings deduction.
Sec. 714. Modification and extension of energy efficient appliance 
                            credit for appliances produced after 2007.
  TITLE VIII--INCENTIVIZING THE EXTRACTION AND PROCESSING OF OIL SHALE

Sec. 801. Incentives for extraction and processing of oil shale.
                 TITLE IX--LAND FOR BIOFUEL PRODUCTION

Sec. 901. Lease of public lands for production of renewable biomass for 
                            biofuels.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) In recent months gas prices across the country have 
        risen to as much as over $4 per gallon.
            (2) High fuel costs retard economic growth and diminish the 
        quality of life for all Americans.
            (3) The trucking industry is particularly hard hit by high 
        fuel prices.
            (4) The boutique fuel requirement, under which certain 
        regions require certain blends of gasoline, contributes to the 
        high price by impeding efficient transport of gasoline across 
        the country.
            (5) Hidden taxes on domestic oil companies are 
        counterproductive and will inevitably be passed down to the 
        consumer, raising the price and making us more dependent on 
        foreign oil companies.
            (6) Attempts to address the issue of high gasoline costs by 
        increasing government involvement in the market through 
        measures such as price controls will only lead to shortages, 
        rationing, and a return of gasoline lines.
            (7) The Federal regulations restricting drilling impose 
        prohibitive costs on the development of new sources of energy, 
        artificially inflating the price of gas.
            (8) It has been estimated that oil shale deposits in 
        Colorado, Utah, and Wyoming hold as little as 1.8 trillion 
        barrels of oil and as many as 8 trillion barrels.
            (9) Federal gas taxes increase the price of oil thus 
        burdening American families, business, and truckers.
            (10) While oil companies already have gas leases, the most 
        promising areas for oil and gas development are currently off 
        limits (ANWR and the OCS).
            (11) Allowing private parties to delay, or even halt, the 
        construction of new refineries through litigation over the 
        National Environmental Policy Act of 1969's Environmental 
        Impact Statement requirement reduces the supply of gas thus 
        raising gas prices.
            (12) Food sources should not be used for the production of 
        fuel, driving up food prices. Rather, it is essential to 
        designate specific land for biofuels while investing in 
        technology that can produce ethanol from nonfood sources.
            (13) It is necessary to invest in emission-free energy 
        sources, such as wind and solar energy technologies, to prepare 
        for the future.

                          TITLE I--REFINERIES

                       Subtitle A--Tax Incentives

SEC. 101. ISSUANCE OF GUIDANCE.

    The Secretary of the Treasury shall, not later than 60 days after 
the date of the enactment of this Act, prescribe the regulations 
described in paragraph (1) of section 179C(b) of the Internal Revenue 
Code of 1986 (relating to election to expense certain refineries).

SEC. 102. TAX-EXEMPT FINANCING OF DOMESTIC USE OIL REFINERY FACILITIES.

    (a) In General.--
            (1) Treatment as exempt facility bond.--Subsection (a) of 
        section 142 of the Internal Revenue Code of 1986 (relating to 
        exempt facility bond) is amended by striking ``or'' at the end 
        of paragraph (14), by striking the period at the end of 
        paragraph (15) and inserting ``, and'', and by inserting at the 
        end the following new paragraph:
            ``(16) domestic use oil refinery facilities.''.
            (2) Domestic use oil refinery facilities.--Section 142 of 
        such Code is amended by adding at the end the following new 
        subsection:
    ``(n) Domestic Use Oil Refinery Facilities.--
            ``(1) In general.--For purposes of subsection (a)(16), the 
        term `domestic use oil refinery facility' means any facility in 
        the United States--
                    ``(A) which processes liquid fuel from crude oil, 
                and
                    ``(B) all of the output of which it is reasonably 
                certain ultimate consumption will occur in the United 
                States.
            ``(2) Election to terminate tax-exempt bond financing by 
        certain refineries.--In the case of a facility financed with 
        bonds which would cease to be tax-exempt by reason of the 
        failure to meet the domestic use requirement of this 
        subsection, rules similar to the rules of subsection (f)(4) 
        shall apply for purposes of this section.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to bonds issued after the date of the enactment of this Act.

SEC. 103. DESIGNATION AND AVAILABILITY OF FEDERAL LANDS FOR OIL AND 
              NATURAL GAS REFINERIES.

    (a) Designation.--Within 18 months after the date of enactment of 
this Act, the President shall designate at least ten sites on Federal 
lands that are suitable for the siting of an oil refinery or natural 
gas refinery (or both).
    (b) Availability of Lands.--Within 24 months after the date of 
enactment of this Act, the President shall make each site designated 
under subsection (a) available to the private sector for construction 
of an oil refinery or natural gas refinery (or both), as appropriate.

               Subtitle B--Availability of Federal Lands

SEC. 111. DEFINITIONS.

    For purposes of this subtitle--
            (1) the term ``base closure law'' means the Defense Base 
        Closure and Realignment Act of 1990 (part A of title XXIX of 
        Public Law 101-510; 10 U.S.C. 2687 note) and title II of the 
        Defense Authorization Amendments and Base Closure and 
        Realignment Act (Public Law 100-526; 10 U.S.C. 2687 note);
            (2) the term ``closed military installation'' means a 
        military installation closed or approved for closure pursuant 
        to a base closure law;
            (3) the term ``designated refinery'' means a refinery 
        designated under section 112(a);
            (4) the term ``Federal refinery authorization''--
                    (A) means any authorization required under Federal 
                law, whether administered by a Federal or State 
                administrative agency or official, with respect to 
                siting, construction, expansion, or operation of a 
                refinery; and
                    (B) includes any permits, special use 
                authorizations, certifications, opinions, or other 
                approvals required under Federal law with respect to 
                siting, construction, expansion, or operation of a 
                refinery;
            (5) the term ``refinery'' means--
                    (A) a facility designed and operated to receive, 
                load, unload, store, transport, process, and refine 
                crude oil by any chemical or physical process, 
                including distillation, fluid catalytic cracking, 
                hydrocracking, coking, alkylation, etherification, 
                polymerization, catalytic reforming, isomerization, 
                hydrotreating, blending, and any combination thereof, 
                in order to produce gasoline or other fuel; or
                    (B) a facility designed and operated to receive, 
                load, unload, store, transport, process, and refine 
                coal by any chemical or physical process, including 
                liquefaction, in order to produce gasoline, diesel, or 
                other liquid fuel as its primary output;
            (6) the term ``Secretary'' means the Secretary of Energy; 
        and
            (7) the term ``State'' means a State, the District of 
        Columbia, the Commonwealth of Puerto Rico, and any other 
        territory or possession of the United States.

SEC. 112. STATE PARTICIPATION AND PRESIDENTIAL DESIGNATION.

    (a) Designation Requirement.--Not later than 90 days after the date 
of enactment of this Act, the President shall designate no less than 3 
closed military installations, or portions thereof, subject to 
subsection (c)(2), that are appropriate for the purposes of siting a 
refinery.
    (b) Analysis of Refinery Sites.--In considering any site for 
possible designation under subsection (a), the President shall conduct 
an analysis of--
            (1) the availability of crude oil supplies to the site, 
        including supplies from domestic production of shale oil and 
        tar sands and other strategic unconventional fuels;
            (2) the distribution of the Nation's refined petroleum 
        product demand;
            (3) whether such site is in close proximity to substantial 
        pipeline infrastructure, including both crude oil and refined 
        petroleum product pipelines, and potential infrastructure 
        feasibility;
            (4) the need to diversify the geographical location of the 
        domestic refining capacity;
            (5) the effect that increased refined petroleum products 
        from a refinery on that site may have on the price and supply 
        of gasoline to consumers;
            (6) the impact of locating a refinery on the site on the 
        readiness and operations of the Armed Forces; and
            (7) such other factors as the President considers 
        appropriate.
    (c) Sale or Disposal.--
            (1) Designation.--Except as provided in paragraph (2), 
        until the expiration of 2 years after the date of enactment of 
        this Act, the Federal Government shall not sell or otherwise 
        dispose of the military installations designated pursuant to 
        subsection (a).
            (2) Governor's objection.--No site may be used for a 
        refinery under this subtitle if, not later than 60 days after 
        designation of the site under subsection (a), the Governor of 
        the State in which the site is located transmits to the 
        President an objection to the designation, unless, not later 
        than 60 days after the President receives such objection, the 
        Congress has by law overridden the objection.
    (d) Redevelopment Authority.--With respect to a closed military 
installation, or portion thereof, designated by the President as a 
potentially suitable refinery site pursuant to subsection (a)--
            (1) the redevelopment authority for the installation, in 
        preparing or revising the redevelopment plan for the 
        installation, shall consider the feasibility and practicability 
        of siting a refinery on the installation; and
            (2) the Secretary of Defense, in managing and disposing of 
        real property at the installation pursuant to the base closure 
        law applicable to the installation, shall give substantial 
        deference to the recommendations of the redevelopment 
        authority, as contained in the redevelopment plan for the 
        installation, regarding the siting of a refinery on the 
        installation.

SEC. 113. PROCESS COORDINATION AND RULES OF PROCEDURE.

    (a) Designation as Lead Agency.--
            (1) In general.--The Department of Energy shall act as the 
        lead agency for the purposes of coordinating all applicable 
        Federal refinery authorizations and related environmental 
        reviews with respect to a designated refinery.
            (2) Other agencies.--Each Federal and State agency or 
        official required to provide a Federal refinery authorization 
        shall cooperate with the Secretary and comply with the 
        deadlines established by the Secretary.
    (b) Schedule.--
            (1) Secretary's authority to set schedule.--The Secretary 
        shall establish a schedule for all Federal refinery 
        authorizations with respect to a designated refinery. In 
        establishing the schedule, the Secretary shall--
                    (A) ensure expeditious completion of all such 
                proceedings; and
                    (B) accommodate the applicable schedules 
                established by Federal law for such proceedings.
            (2) Failure to meet schedule.--If a Federal or State 
        administrative agency or official does not complete a 
        proceeding for an approval that is required for a Federal 
        refinery authorization in accordance with the schedule 
        established by the Secretary under this subsection, the 
        applicant may pursue remedies under subsection (d).
    (c) Consolidated Record.--The Secretary shall, with the cooperation 
of Federal and State administrative agencies and officials, maintain a 
complete consolidated record of all decisions made or actions taken by 
the Secretary or by a Federal administrative agency or officer (or 
State administrative agency or officer acting under delegated Federal 
authority) with respect to any Federal refinery authorization. Such 
record shall be the record for judicial review under subsection (d) of 
decisions made or actions taken by Federal and State administrative 
agencies and officials, except that, if the Court determines that the 
record does not contain sufficient information, the Court may remand 
the proceeding to the Secretary for further development of the 
consolidated record.
    (d) Judicial Review.--
            (1) In general.--The United States Court of Appeals for the 
        District of Columbia shall have original and exclusive 
        jurisdiction over any civil action for the review of--
                    (A) an order or action, related to a Federal 
                refinery authorization, by a Federal or State 
                administrative agency or official; and
                    (B) an alleged failure to act by a Federal or State 
                administrative agency or official acting pursuant to a 
                Federal refinery authorization.
        The failure of an agency or official to act on a Federal 
        refinery authorization in accordance with the Secretary's 
        schedule established pursuant to subsection (b) shall be 
        considered inconsistent with Federal law for the purposes of 
        paragraph (2) of this subsection.
            (2) Court action.--If the Court finds that an order or 
        action described in paragraph (1)(A) is inconsistent with the 
        Federal law governing such Federal refinery authorization, or 
        that a failure to act as described in paragraph (1)(B) has 
        occurred, and the order, action, or failure to act would 
        prevent the siting, construction, expansion, or operation of 
        the designated refinery, the Court shall remand the proceeding 
        to the agency or official to take appropriate action consistent 
        with the order of the Court. If the Court remands the order, 
        action, or failure to act to the Federal or State 
        administrative agency or official, the Court shall set a 
        reasonable schedule and deadline for the agency or official to 
        act on remand.
            (3) Secretary's action.--For any civil action brought under 
        this subsection, the Secretary shall promptly file with the 
        Court the consolidated record compiled by the Secretary 
        pursuant to subsection (c).
            (4) Expedited review.--The Court shall set any civil action 
        brought under this subsection for expedited consideration.
            (5) Attorney's fees.--In any action challenging a Federal 
        refinery authorization that has been granted, reasonable 
        attorney's fees and other expenses of litigation shall be 
        awarded to the prevailing party. This paragraph shall not apply 
        to any action seeking remedies for denial of a Federal refinery 
        authorization or failure to act on an application for a Federal 
        refinery authorization.

SEC. 114. ALTERNATIVE USES OF LAND.

    Any land designated under section 112(a) that has not been used for 
an oil refinery within 10 years after such designation shall be made 
available for leasing for renewable energy development purposes, such 
as wind or solar energy installations or an ethanol refinery.

                        TITLE II--NUCLEAR ENERGY

SEC. 201. WASTE CONFIDENCE.

    The Nuclear Regulatory Commission may not deny an application for a 
license, permit, or other authorization under the Atomic Energy Act of 
1954 on the grounds that sufficient capacity does not exist, or will 
not become available on a timely basis, for disposal of spent nuclear 
fuel or high-level radioactive waste from the facility for which the 
license, permit, or other authorization is sought.

SEC. 202. ASME NUCLEAR CERTIFICATION CREDIT.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 (relating to business related 
credits) is amended by adding at the end the following new section:

``SEC. 45Q. ASME NUCLEAR CERTIFICATION CREDIT.

    ``(a) In General.--For purposes of section 38, the ASME Nuclear 
Certification credit determined under this section for any taxable year 
is an amount equal to 15 percent of the qualified nuclear expenditures 
paid or incurred by the taxpayer.
    ``(b) Qualified Nuclear Expenditures.--For purposes of this 
section, the term `qualified nuclear expenditures' means any 
expenditure related to--
            ``(1) obtaining a certification under the American Society 
        of Mechanical Engineers Nuclear Component Certification 
        program, or
            ``(2) increasing the taxpayer's capacity to construct, 
        fabricate, assemble, or install components--
                    ``(A) for any facility which uses nuclear energy to 
                produce electricity, and
                    ``(B) with respect to the construction, 
                fabrication, assembly, or installation of which the 
                taxpayer is certified under such program.
    ``(c) Timing of Credit.--The credit allowed under subsection (a) 
for any expenditures shall be allowed--
            ``(1) in the case of a qualified nuclear expenditure 
        described in subsection (b)(1), for the taxable year of such 
        certification, and
            ``(2) in the case of any other qualified nuclear 
        expenditure, for the taxable year in which such expenditure is 
        paid or incurred.
    ``(d) Special Rules.--
            ``(1) Basis adjustment.--For purposes of this subtitle, if 
        a credit is allowed under this section for an expenditure, the 
        increase in basis which would result (but for this subsection) 
        for such expenditure shall be reduced by the amount of the 
        credit allowed under this section.
            ``(2) Denial of double benefit.--No deduction shall be 
        allowed under this chapter for any amount taken into account in 
        determining the credit under this section.
    ``(e) Termination.--This section shall not apply to any 
expenditures paid or incurred in taxable years beginning after December 
31, 2019.''.
    (b) Conforming Amendments.--(1) Subsection (b) of section 38 is 
amended by striking ``plus'' at the end of paragraph (32), by striking 
the period at the end of paragraph (33) and inserting ``, plus'', and 
by adding at the end the following new paragraph:
            ``(34) the ASME Nuclear Certification credit determined 
        under section 45Q(a).''.
    (2) Subsection (a) of section 1016 (relating to adjustments to 
basis) 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 45Q(e)(1).''.
    (c) Clerical Amendment.--The table of sections for subpart B of 
part IV of subchapter A of chapter 1 of such Code (relating to other 
credits) is amended by adding at the end the following new section:

``Sec. 45R. Credit for carbon dioxide captured from industrial sources 
                            and used as a tertiary injectant in 
                            enhanced oil and natural gas recovery.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to expenditures paid or incurred in taxable years beginning after 
December 31, 2007.

                          TITLE III--DRILLING

                       Subtitle A--Tax Provisions

SEC. 301. CREDIT FOR PRODUCING FUEL FROM NONCONVENTIONAL SOURCES TO 
              APPLY TO GAS PRODUCED ONSHORE FROM FORMATIONS MORE THAN 
              15,000 FEET DEEP.

    (a) In General.--Subparagraph (B) of section 45K(c)(1) of the 
Internal Revenue Code of 1986 is amended by striking ``or'' at the end 
of clause (i), by striking ``and'' at the end of clause (ii) and 
inserting ``or'', and by inserting after clause (ii) the following new 
clause:
                            ``(iii) an onshore well from a formation 
                        more than 15,000 feet deep, and''.
    (b) Eligible Deep Gas Wells.--Section 45K of such Code is amended 
by adding at the end the following new subsection:
    ``(h) Eligible Deep Gas Wells.--In the case of a well producing 
qualified fuel described in subsection (c)(1)(B)(iii)--
            ``(1) for purposes of subsection (e)(1)(A), such well shall 
        be treated as drilled before January 1, 1993, if such well is 
        drilled after the date of the enactment of this subsection, and
            ``(2) subsection (e)(2) shall not apply.''.
    (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. 302. TAX CREDIT FOR CARBON DIOXIDE CAPTURED FROM INDUSTRIAL 
              SOURCES AND USED IN ENHANCED OIL AND NATURAL GAS 
              RECOVERY.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 (relating to business credits), as 
amended by this Act, is amended by adding at the end the following new 
section:

``SEC. 45R. CREDIT FOR CARBON DIOXIDE CAPTURED FROM INDUSTRIAL SOURCES 
              AND USED AS A TERTIARY INJECTANT IN ENHANCED OIL AND 
              NATURAL GAS RECOVERY.

    ``(a) General Rule.--For purposes of section 38, the captured 
carbon dioxide tertiary injectant credit for any taxable year is an 
amount equal to the product of--
            ``(1) the credit amount, and
            ``(2) the qualified carbon dioxide captured from industrial 
        sources and used as a tertiary injectant in qualified enhanced 
        oil and natural gas recovery which is attributable to the 
        taxpayer.
    ``(b) Credit Amount.--For purposes of this section--
            ``(1) In general.--The credit amount is $0.75 per 1,000 
        standard cubic feet.
            ``(2) Inflation adjustment.--In the case of any taxable 
        year beginning in a calendar year after 2007, there shall be 
        substituted for the $0.75 amount under paragraph (1) an amount 
        equal to the product of--
                    ``(A) $0.75, multiplied by
                    ``(B) the inflation adjustment factor for such 
                calendar year determined under section 43(b)(3)(B) for 
                such calendar year, determined by substituting `2006' 
                for `1990'.
    ``(c) Qualified Carbon Dioxide.--For purposes of this section--
            ``(1) In general.--The term `qualified carbon dioxide' 
        means carbon dioxide captured from an anthropogenic source 
        that--
                    ``(A) would otherwise be released into the 
                atmosphere as industrial emission of greenhouse gas,
                    ``(B) is measurable at the source of capture,
                    ``(C) is compressed, treated, and transported via 
                pipeline,
                    ``(D) is sold as a tertiary injectant in qualified 
                enhanced oil and natural gas recovery, and
                    ``(E) is permanently sequestered in geological 
                formations as a result of the enhanced oil and natural 
                gas recovery process.
            ``(2) Anthropogenic source.--An anthropogenic source of 
        carbon dioxide is an industrial source, including any of the 
        following types of plants, and facilities related to such 
        plant--
                    ``(A) a coal and natural gas fired electrical 
                generating power station,
                    ``(B) a natural gas processing and treating plant,
                    ``(C) an ethanol plant,
                    ``(D) a fertilizer plant, and
                    ``(E) a chemical plant.
            ``(3) Definitions.--
                    ``(A) Qualified enhanced oil and natural gas 
                recovery.--The term `qualified enhanced oil and natural 
                gas recovery' has the meaning given such term by 
                section 43(c)(2).
                    ``(B) Tertiary injectant.--The term `tertiary 
                injectant' has the same meaning as when used within 
                section 193(b)(1).
    ``(d) Other Definitions and Special Rules.--For purposes of this 
section--
            ``(1) Only carbon dioxide captured within the united states 
        taken into account.--Sales shall be taken into account under 
        this section only with respect to qualified carbon dioxide 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)).
            ``(2) Recycled carbon dioxide.--The term `qualified carbon 
        dioxide' includes the initial deposit of captured carbon 
        dioxide used as a tertiary injectant. Such term does not 
        include carbon dioxide that is re-captured, recycled, and re-
        injected as part of the enhanced oil and natural gas recovery 
        process.
            ``(3) Credit attributable to taxpayer.--Any credit under 
        this section shall be attributable to the person that captures, 
        treats, compresses, transports and sells the carbon dioxide for 
        use as a tertiary injectant in enhanced oil and natural gas 
        recovery, except to the extent provided in regulations 
        prescribed by the Secretary.''.
    (b) Conforming Amendment.--Section 38(b) of such Code (relating to 
general business credit), as amended by this Act, is amended by 
striking ``plus'' at the end of paragraph (33), by striking the period 
at the end of paragraph (34) and inserting ``, plus'', and by adding at 
the end of following new paragraph:
            ``(35) the captured carbon dioxide tertiary injectant 
        credit determined under section 45R(a).''.
    (c) Clerical Amendment.--The table of sections for subpart B of 
part IV of subchapter A of chapter 1 of such Code (relating to other 
credits) is amended by adding at the end the following new section:

``Sec. 45R. Credit for carbon dioxide captured from industrial sources 
                            and used as a tertiary injectant in 
                            enhanced oil and natural gas recovery.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

   Subtitle B--Termination of Congressional Moratoria on Oil and Gas 
               Development on the Outer Continental Shelf

SEC. 311. TERMINATION OF LAWS PROHIBITING EXPENDITURES FOR OIL AND 
              NATURAL GAS LEASING AND PRELEASING ACTIVITIES REGARDING 
              AREAS OF THE OUTER CONTINENTAL SHELF.

    All provisions of existing Federal law prohibiting the spending of 
appropriated funds to conduct oil and natural gas leasing and 
preleasing activities for any area of the Outer Continental Shelf shall 
have no force or effect.

   Subtitle C--Oil and Gas Development on the Coastal Plain of Alaska

SEC. 321. SHORT TITLE.

    This subtitle may be cited as the ``American-Made Energy and Good 
Jobs Act''.

SEC. 322. DEFINITIONS.

    In this subtitle:
            (1) Coastal plain.--The term ``Coastal Plain'' means that 
        area described in appendix I to part 37 of title 50, Code of 
        Federal Regulations.
            (2) Secretary.--The term ``Secretary'', except as otherwise 
        provided, means the Secretary of the Interior or the 
        Secretary's designee.

SEC. 323. LEASING PROGRAM FOR LANDS WITHIN THE COASTAL PLAIN.

    (a) In General.--The Secretary shall take such actions as are 
necessary--
            (1) to establish and implement, in accordance with this 
        subtitle and acting through the Director of the Bureau of Land 
        Management in consultation with the Director of the United 
        States Fish and Wildlife Service, a competitive oil and gas 
        leasing program that will result in an environmentally sound 
        program for the exploration, development, and production of the 
        oil and gas resources of the Coastal Plain; and
            (2) to administer the provisions of this subtitle through 
        regulations, lease terms, conditions, restrictions, 
        prohibitions, stipulations, and other provisions that ensure 
        the oil and gas exploration, development, and production 
        activities on the Coastal Plain will result in no significant 
        adverse effect on fish and wildlife, their habitat, subsistence 
        resources, and the environment, including, in furtherance of 
        this goal, by requiring the application of the best 
        commercially available technology for oil and gas exploration, 
        development, and production to all exploration, development, 
        and production operations under this subtitle in a manner that 
        ensures the receipt of fair market value by the public for the 
        mineral resources to be leased.
    (b) Repeal.--
            (1) Repeal.--Section 1003 of the Alaska National Interest 
        Lands Conservation Act of 1980 (16 U.S.C. 3143) is repealed.
            (2) Conforming amendment.--The table of contents in section 
        1 of such Act is amended by striking the item relating to 
        section 1003.
    (c) Compliance With Requirements Under Certain Other Laws.--
            (1) Compatibility.--For purposes of the National Wildlife 
        Refuge System Administration Act of 1966 (16 U.S.C. 668dd et 
        seq.), the oil and gas leasing program and activities 
        authorized by this section in the Coastal Plain are deemed to 
        be compatible with the purposes for which the Arctic National 
        Wildlife Refuge was established, and no further findings or 
        decisions are required to implement this determination.
            (2) Adequacy of the department of the interior's 
        legislative environmental impact statement.--The ``Final 
        Legislative Environmental Impact Statement'' (April 1987) on 
        the Coastal Plain prepared pursuant to section 1002 of the 
        Alaska National Interest Lands Conservation Act of 1980 (16 
        U.S.C. 3142) and section 102(2)(C) of the National 
        Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)) is 
        deemed to satisfy the requirements under the National 
        Environmental Policy Act of 1969 that apply with respect to 
        prelease activities, including actions authorized to be taken 
        by the Secretary to develop and promulgate the regulations for 
        the establishment of a leasing program authorized by this 
        subtitle before the conduct of the first lease sale.
            (3) Compliance with nepa for other actions.--Before 
        conducting the first lease sale under this subtitle, the 
        Secretary shall prepare an environmental impact statement under 
        the National Environmental Policy Act of 1969 with respect to 
        the actions authorized by this Act that are not referred to in 
        paragraph (2). Notwithstanding any other law, the Secretary is 
        not required to identify nonleasing alternative courses of 
        action or to analyze the environmental effects of such courses 
        of action. The Secretary shall only identify a preferred action 
        for such leasing and a single leasing alternative, and analyze 
        the environmental effects and potential mitigation measures for 
        those two alternatives. The identification of the preferred 
        action and related analysis for the first lease sale under this 
        subtitle shall be completed within 18 months after the date of 
        enactment of this Act. The Secretary shall only consider public 
        comments that specifically address the Secretary's preferred 
        action and that are filed within 20 days after publication of 
        an environmental analysis. Notwithstanding any other law, 
        compliance with this paragraph is deemed to satisfy all 
        requirements for the analysis and consideration of the 
        environmental effects of proposed leasing under this subtitle.
    (d) Relationship to State and Local Authority.--Nothing in this 
subtitle shall be considered to expand or limit State and local 
regulatory authority.
    (e) Special Areas.--
            (1) In general.--The Secretary, after consultation with the 
        State of Alaska, the city of Kaktovik, and the North Slope 
        Borough, may designate up to a total of 45,000 acres of the 
        Coastal Plain as a Special Area if the Secretary determines 
        that the Special Area is of such unique character and interest 
        so as to require special management and regulatory protection. 
        The Secretary shall designate as such a Special Area the 
        Sadlerochit Spring area, comprising approximately 4,000 acres.
            (2) Management.--Each such Special Area shall be managed so 
        as to protect and preserve the area's unique and diverse 
        character including its fish, wildlife, and subsistence 
        resource values.
            (3) Exclusion from leasing or surface occupancy.--The 
        Secretary may exclude any Special Area from leasing. If the 
        Secretary leases a Special Area, or any part thereof, for 
        purposes of oil and gas exploration, development, production, 
        and related activities, there shall be no surface occupancy of 
        the lands comprising the Special Area.
            (4) Directional drilling.--Notwithstanding the other 
        provisions of this subsection, the Secretary may lease all or a 
        portion of a Special Area under terms that permit the use of 
        horizontal drilling technology from sites on leases located 
        outside the Special Area.
    (f) Limitation on Closed Areas.--The Secretary's sole authority to 
close lands within the Coastal Plain to oil and gas leasing and to 
exploration, development, and production is that set forth in this 
subtitle.
    (g) Regulations.--
            (1) In general.--The Secretary shall prescribe such 
        regulations as may be necessary to carry out this subtitle, 
        including rules and regulations relating to protection of the 
        fish and wildlife, their habitat, subsistence resources, and 
        environment of the Coastal Plain, by no later than 15 months 
        after the date of enactment of this Act.
            (2) Revision of regulations.--The Secretary shall 
        periodically review and, if appropriate, revise the rules and 
        regulations issued under subsection (a) to reflect any 
        significant biological, environmental, or engineering data that 
        come to the Secretary's attention.

SEC. 324. LEASE SALES.

    (a) In General.--Lands may be leased pursuant to this subtitle to 
any person qualified to obtain a lease for deposits of oil and gas 
under the Mineral Leasing Act (30 U.S.C. 181 et seq.).
    (b) Procedures.--The Secretary shall, by regulation, establish 
procedures for--
            (1) receipt and consideration of sealed nominations for any 
        area in the Coastal Plain for inclusion in, or exclusion (as 
        provided in subsection (c)) from, a lease sale;
            (2) the holding of lease sales after such nomination 
        process; and
            (3) public notice of and comment on designation of areas to 
        be included in, or excluded from, a lease sale.
    (c) Lease Sale Bids.--Bidding for leases under this subtitle shall 
be by sealed competitive cash bonus bids.
    (d) Acreage Minimum in First Sale.--In the first lease sale under 
this subtitle, the Secretary shall offer for lease those tracts the 
Secretary considers to have the greatest potential for the discovery of 
hydrocarbons, taking into consideration nominations received pursuant 
to subsection (b)(1), but in no case less than 200,000 acres.
    (e) Timing of Lease Sales.--The Secretary shall--
            (1) conduct the first lease sale under this subtitle within 
        22 months after the date of the enactment of this Act; and
            (2) conduct additional sales so long as sufficient interest 
        in development exists to warrant, in the Secretary's judgment, 
        the conduct of such sales.

SEC. 325. GRANT OF LEASES BY THE SECRETARY.

    (a) In General.--The Secretary may grant to the highest responsible 
qualified bidder in a lease sale conducted pursuant to section 424 any 
lands to be leased on the Coastal Plain upon payment by the lessee of 
such bonus as may be accepted by the Secretary.
    (b) Subsequent Transfers.--No lease issued under this subtitle may 
be sold, exchanged, assigned, sublet, or otherwise transferred except 
with the approval of the Secretary. Prior to any such approval the 
Secretary shall consult with, and give due consideration to the views 
of, the Attorney General.

SEC. 326. LEASE TERMS AND CONDITIONS.

    An oil or gas lease issued pursuant to this subtitle shall--
            (1) provide for the payment of a royalty of not less than 
        12\1/2\ percent in amount or value of the production removed or 
        sold from the lease, as determined by the Secretary under the 
        regulations applicable to other Federal oil and gas leases;
            (2) require that the lessee of lands within the Coastal 
        Plain shall be fully responsible and liable for the reclamation 
        of lands within the Coastal Plain and any other Federal lands 
        that are adversely affected in connection with exploration, 
        development, production, or transportation activities conducted 
        under the lease and within the Coastal Plain by the lessee or 
        by any of the subcontractors or agents of the lessee;
            (3) provide that the lessee may not delegate or convey, by 
        contract or otherwise, the reclamation responsibility and 
        liability to another person without the express written 
        approval of the Secretary;
            (4) provide that the standard of reclamation for lands 
        required to be reclaimed under this subtitle shall be, as 
        nearly as practicable, a condition capable of supporting the 
        uses which the lands were capable of supporting prior to any 
        exploration, development, or production activities, or upon 
        application by the lessee, to a higher or better use as 
        approved by the Secretary;
            (5) include requirements and restrictions to provide for 
        reasonable protection of fish and wildlife, their habitat, 
        subsistence resources, and the environment as determined by the 
        Secretary;
            (6) prohibit the export of oil produced under the lease; 
        and
            (7) contain such other provisions as the Secretary 
        determines necessary to ensure compliance with the provisions 
        of this subtitle and the regulations issued under this 
        subtitle.

SEC. 327. COASTAL PLAIN ENVIRONMENTAL PROTECTION.

    (a) No Significant Adverse Effect Standard To Govern Authorized 
Coastal Plain Activities.--The Secretary shall, consistent with the 
requirements of section 423, administer the provisions of this subtitle 
through regulations, lease terms, conditions, restrictions, 
prohibitions, stipulations, and other provisions that--
            (1) ensure the oil and gas exploration, development, and 
        production activities on the Coastal Plain will result in no 
        significant adverse effect on fish and wildlife, their habitat, 
        and the environment;
            (2) require the application of the best commercially 
        available technology for oil and gas exploration, development, 
        and production on all new exploration, development, and 
        production operations; and
            (3) ensure that the maximum amount of surface acreage 
        covered by production and support facilities, including 
        airstrips and any areas covered by gravel berms or piers for 
        support of pipelines, does not exceed 2,000 acres on the 
        Coastal Plain.
    (b) Site-Specific Assessment and Mitigation.--The Secretary shall 
also require, with respect to any proposed drilling and related 
activities, that--
            (1) a site-specific analysis be made of the probable 
        effects, if any, that the drilling or related activities will 
        have on fish and wildlife, their habitat, subsistence 
        resources, and the environment;
            (2) a plan be implemented to avoid, minimize, and mitigate 
        (in that order and to the extent practicable) any significant 
        adverse effect identified under paragraph (1); and
            (3) the development of the plan shall occur after 
        consultation with the agency or agencies having jurisdiction 
        over matters mitigated by the plan.
    (c) Regulations To Protect Coastal Plain Fish and Wildlife 
Resources, Subsistence Users, and the Environment.--Before implementing 
the leasing program authorized by this subtitle, the Secretary shall 
prepare and promulgate regulations, lease terms, conditions, 
restrictions, prohibitions, stipulations, and other measures designed 
to ensure that the activities undertaken on the Coastal Plain under 
this subtitle are conducted in a manner consistent with the purposes 
and environmental requirements of this subtitle.
    (d) Compliance With Federal and State Environmental Laws and Other 
Requirements.--The proposed regulations, lease terms, conditions, 
restrictions, prohibitions, and stipulations for the leasing program 
under this subtitle shall require compliance with all applicable 
provisions of Federal and State environmental law, and shall also 
require the following:
            (1) Standards at least as effective as the safety and 
        environmental mitigation measures set forth in items 1 through 
        29 at pages 167 through 169 of the ``Final Legislative 
        Environmental Impact Statement'' (April 1987) on the Coastal 
        Plain.
            (2) Seasonal limitations on exploration, development, and 
        related activities, where necessary, to avoid significant 
        adverse effects during periods of concentrated fish and 
        wildlife breeding, denning, nesting, spawning, and migration.
            (3) Design safety and construction standards for all 
        pipelines and any access and service roads, that--
                    (A) minimize, to the maximum extent possible, 
                adverse effects upon the passage of migratory species 
                such as caribou; and
                    (B) minimize adverse effects upon the flow of 
                surface water by requiring the use of culverts, 
                bridges, and other structural devices.
            (4) Prohibitions on general public access and use on all 
        pipeline access and service roads.
            (5) Stringent reclamation and rehabilitation requirements, 
        consistent with the standards set forth in this subtitle, 
        requiring the removal from the Coastal Plain of all oil and gas 
        development and production facilities, structures, and 
        equipment upon completion of oil and gas production operations, 
        except that the Secretary may exempt from the requirements of 
        this paragraph those facilities, structures, or equipment that 
        the Secretary determines would assist in the management of the 
        Arctic National Wildlife Refuge and that are donated to the 
        United States for that purpose.
            (6) Appropriate prohibitions or restrictions on access by 
        all modes of transportation.
            (7) Appropriate prohibitions or restrictions on sand and 
        gravel extraction.
            (8) Consolidation of facility siting.
            (9) Appropriate prohibitions or restrictions on use of 
        explosives.
            (10) Avoidance, to the extent practicable, of springs, 
        streams, and river system; the protection of natural surface 
        drainage patterns, wetlands, and riparian habitats; and the 
        regulation of methods or techniques for developing or 
        transporting adequate supplies of water for exploratory 
        drilling.
            (11) Avoidance or minimization of air traffic-related 
        disturbance to fish and wildlife.
            (12) Treatment and disposal of hazardous and toxic wastes, 
        solid wastes, reserve pit fluids, drilling muds and cuttings, 
        and domestic wastewater, including an annual waste management 
        report, a hazardous materials tracking system, and a 
        prohibition on chlorinated solvents, in accordance with 
        applicable Federal and State environmental law.
            (13) Fuel storage and oil spill contingency planning.
            (14) Research, monitoring, and reporting requirements.
            (15) Field crew environmental briefings.
            (16) Avoidance of significant adverse effects upon 
        subsistence hunting, fishing, and trapping by subsistence 
        users.
            (17) Compliance with applicable air and water quality 
        standards.
            (18) Appropriate seasonal and safety zone designations 
        around well sites, within which subsistence hunting and 
        trapping shall be limited.
            (19) Reasonable stipulations for protection of cultural and 
        archeological resources.
            (20) All other protective environmental stipulations, 
        restrictions, terms, and conditions deemed necessary by the 
        Secretary.
    (e) Considerations.--In preparing and promulgating regulations, 
lease terms, conditions, restrictions, prohibitions, and stipulations 
under this section, the Secretary shall consider the following:
            (1) The stipulations and conditions that govern the 
        National Petroleum Reserve-Alaska leasing program, as set forth 
        in the 1999 Northeast National Petroleum Reserve-Alaska Final 
        Integrated Activity Plan/Environmental Impact Statement.
            (2) The environmental protection standards that governed 
        the initial Coastal Plain seismic exploration program under 
        parts 37.31 to 37.33 of title 50, Code of Federal Regulations.
            (3) The land use stipulations for exploratory drilling on 
        the KIC-ASRC private lands that are set forth in Appendix 2 of 
        the August 9, 1983, agreement between Arctic Slope Regional 
        Corporation and the United States.
    (f) Facility Consolidation Planning.--
            (1) In general.--The Secretary shall, after providing for 
        public notice and comment, prepare and update periodically a 
        plan to govern, guide, and direct the siting and construction 
        of facilities for the exploration, development, production, and 
        transportation of Coastal Plain oil and gas resources.
            (2) Objectives.--The plan shall have the following 
        objectives:
                    (A) Avoiding unnecessary duplication of facilities 
                and activities.
                    (B) Encouraging consolidation of common facilities 
                and activities.
                    (C) Locating or confining facilities and activities 
                to areas that will minimize impact on fish and 
                wildlife, their habitat, and the environment.
                    (D) Utilizing existing facilities wherever 
                practicable.
                    (E) Enhancing compatibility between wildlife values 
                and development activities.
    (g) Access to Public Lands.--The Secretary shall--
            (1) manage public lands in the Coastal Plain subject to 
        subsections (a) and (b) of section 811 of the Alaska National 
        Interest Lands Conservation Act (16 U.S.C. 3121); and
            (2) ensure that local residents shall have reasonable 
        access to public lands in the Coastal Plain for traditional 
        uses.

SEC. 328. EXPEDITED JUDICIAL REVIEW.

    (a) Filing of Complaint.--
            (1) Deadline.--Subject to paragraph (2), any complaint 
        seeking judicial review of any provision of this Act or any 
        action of the Secretary under this subtitle shall be filed--
                    (A) except as provided in subparagraph (B), within 
                the 90-day period beginning on the date of the action 
                being challenged; or
                    (B) in the case of a complaint based solely on 
                grounds arising after such period, within 90 days after 
                the complainant knew or reasonably should have known of 
                the grounds for the complaint.
            (2) Venue.--Any complaint seeking judicial review of any 
        provision of this subtitle or any action of the Secretary under 
        this subtitle may be filed only in the United States Court of 
        Appeals for the District of Columbia.
            (3) Limitation on scope of certain review.--Judicial review 
        of a Secretarial decision to conduct a lease sale under this 
        subtitle, including the environmental analysis thereof, shall 
        be limited to whether the Secretary has complied with the terms 
        of this subtitle and shall be based upon the administrative 
        record of that decision. The Secretary's identification of a 
        preferred course of action to enable leasing to proceed and the 
        Secretary's analysis of environmental effects under this 
        subtitle shall be presumed to be correct unless shown otherwise 
        by clear and convincing evidence to the contrary.
    (b) Limitation on Other Review.--Actions of the Secretary with 
respect to which review could have been obtained under this section 
shall not be subject to judicial review in any civil or criminal 
proceeding for enforcement.

SEC. 329. FEDERAL AND STATE DISTRIBUTION OF REVENUES.

    (a) In General.--Notwithstanding any other provision of law, of the 
amount of adjusted bonus, rental, and royalty revenues from Federal oil 
and gas leasing and operations authorized under this subtitle--
            (1) 25 percent shall be paid to the State of Alaska; and
            (2) except as provided in section 432(d), the balance shall 
        be deposited into the Treasury as miscellaneous receipts.
    (b) Payments to Alaska.--Payments to the State of Alaska under this 
section shall be made semiannually.

SEC. 330. RIGHTS-OF-WAY ACROSS THE COASTAL PLAIN.

    (a) In General.--The Secretary shall issue rights-of-way and 
easements across the Coastal Plain for the transportation of oil and 
gas--
            (1) except as provided in paragraph (2), under section 28 
        of the Mineral Leasing Act (30 U.S.C. 185), without regard to 
        title XI of the Alaska National Interest Lands Conservation Act 
        (30 U.S.C. 3161 et seq.); and
            (2) under title XI of the Alaska National Interest Lands 
        Conservation Act (30 U.S.C. 3161 et seq.), for access 
        authorized by sections 1110 and 1111 of that Act (16 U.S.C. 
        3170 and 3171).
    (b) Terms and Conditions.--The Secretary shall include in any 
right-of-way or easement issued under subsection (a) such terms and 
conditions as may be necessary to ensure that transportation of oil and 
gas does not result in a significant adverse effect on the fish and 
wildlife, subsistence resources, their habitat, and the environment of 
the Coastal Plain, including requirements that facilities be sited or 
designed so as to avoid unnecessary duplication of roads and pipelines.
    (c) Regulations.--The Secretary shall include in regulations under 
section 423(g) provisions granting rights-of-way and easements 
described in subsection (a) of this section.

SEC. 331. CONVEYANCE.

    In order to maximize Federal revenues by removing clouds on title 
to lands and clarifying land ownership patterns within the Coastal 
Plain, the Secretary, notwithstanding the provisions of section 
1302(h)(2) of the Alaska National Interest Lands Conservation Act (16 
U.S.C. 3192(h)(2)), shall convey--
            (1) to the Kaktovik Inupiat Corporation the surface estate 
        of the lands described in paragraph 1 of Public Land Order 
        6959, to the extent necessary to fulfill the Corporation's 
        entitlement under sections 12 and 14 of the Alaska Native 
        Claims Settlement Act (43 U.S.C. 1611 and 1613) in accordance 
        with the terms and conditions of the Agreement between the 
        Department of the Interior, the United States Fish and Wildlife 
        Service, the Bureau of Land Management, and the Kaktovik 
        Inupiat Corporation effective January 22, 1993; and
            (2) to the Arctic Slope Regional Corporation the remaining 
        subsurface estate to which it is entitled pursuant to the 
        August 9, 1983, agreement between the Arctic Slope Regional 
        Corporation and the United States of America.

SEC. 332. LOCAL GOVERNMENT IMPACT AID AND COMMUNITY SERVICE ASSISTANCE.

    (a) Financial Assistance Authorized.--
            (1) In general.--The Secretary may use amounts available 
        from the Coastal Plain Local Government Impact Aid Assistance 
        Fund established by subsection (d) to provide timely financial 
        assistance to entities that are eligible under paragraph (2) 
        and that are directly impacted by the exploration for or 
        production of oil and gas on the Coastal Plain under this 
        subtitle.
            (2) Eligible entities.--The North Slope Borough, the City 
        of Kaktovik, and any other borough, municipal subdivision, 
        village, or other community in the State of Alaska that is 
        directly impacted by exploration for, or the production of, oil 
        or gas on the Coastal Plain under this Act, as determined by 
        the Secretary, shall be eligible for financial assistance under 
        this section.
    (b) Use of Assistance.--Financial assistance under this section may 
be used only for--
            (1) planning for mitigation of the potential effects of oil 
        and gas exploration and development on environmental, social, 
        cultural, recreational, and subsistence values;
            (2) implementing mitigation plans and maintaining 
        mitigation projects;
            (3) developing, carrying out, and maintaining projects and 
        programs that provide new or expanded public facilities and 
        services to address needs and problems associated with such 
        effects, including fire-fighting, police, water, waste 
        treatment, medivac, and medical services; and
            (4) establishment of a coordination office, by the north 
        slope borough, in the City of Kaktovik, which shall--
                    (A) coordinate with and advise developers on local 
                conditions, impact, and history of the areas utilized 
                for development; and
                    (B) provide to the Committee on Resources of the 
                House of Representatives and the Committee on Energy 
                and Natural Resources of the Senate an annual report on 
                the status of coordination between developers and the 
                communities affected by development.
    (c) Application.--
            (1) In general.--Any community that is eligible for 
        assistance under this section may submit an application for 
        such assistance to the Secretary, in such form and under such 
        procedures as the Secretary may prescribe by regulation.
            (2) North slope borough communities.--A community located 
        in the North Slope Borough may apply for assistance under this 
        section either directly to the Secretary or through the North 
        Slope Borough
            (3) Application assistance.--The Secretary shall work 
        closely with and assist the North Slope Borough and other 
        communities eligible for assistance under this section in 
        developing and submitting applications for assistance under 
        this section.
    (d) Establishment of Fund.--
            (1) In general.--There is established in the Treasury the 
        Coastal Plain Local Government Impact Aid Assistance Fund.
            (2) Use.--Amounts in the fund may be used only for 
        providing financial assistance under this section.
            (3) Deposits.--Subject to paragraph (4), there shall be 
        deposited into the fund amounts received by the United States 
        as revenues derived from rents, bonuses, and royalties from 
        Federal leases and lease sales authorized under this subtitle.
            (4) Limitation on deposits.--The total amount in the fund 
        may not exceed $11,000,000.
            (5) Investment of balances.--The Secretary of the Treasury 
        shall invest amounts in the fund in interest bearing government 
        securities.
    (e) Authorization of Appropriations.--To provide financial 
assistance under this section there is authorized to be appropriated to 
the Secretary from the Coastal Plain Local Government Impact Aid 
Assistance Fund $5,000,000 for each fiscal year.

       TITLE IV--GAS PRICE TAX CREDIT FOR FAMILIES AND BUSINESSES

SEC. 401. DEDUCTION FOR CERTAIN COMMUTING EXPENSES OF INDIVIDUALS.

    (a) In General.--Part VII of subchapter B of chapter 1 of the 
Internal Revenue Code of 1986 (relating to additional itemized 
deductions) is amended by redesignating section 224 as section 225 and 
by inserting after section 223 the following new section:

``SEC. 224. CERTAIN COMMUTING EXPENSES.

    ``(a) In General.--In the case of an individual, there shall be 
allowed as a deduction an amount equal to the applicable percentage of 
the amount paid or incurred by the taxpayer during the taxable year for 
qualified commuting expenses of the taxpayer, his spouse, and 
dependents.
    ``(b) Applicable Percentage.--For purposes of this section--
            ``(1) In general.--The term `applicable percentage' means, 
        with respect to the expenses of any individual in connection 
        with a round-trip commute of a certain number of miles, the 
        percentage determined in accordance with the following table:

``In the case of a                                       The applicable
  round-trip commute of:                                 percentage is:
        Less than 10 miles...........................       10 percent 
        At least 10 miles, but not greater than 15          30 percent 
            miles.
        At least 15 miles, but not greater than 25          50 percent 
            miles.
        At least 25 miles............................       75 percent.
            ``(2) Special rule for high gas mileage vehicles and 
        carpoolers.--Notwithstanding paragraph (1), the applicable 
        percentage shall be 100 percent with respect to any round-trip 
        commute which is made--
                    ``(A) in a motor vehicle which has a gasoline 
                equivalent fuel efficiency of more than 40 miles per 
                gallon, or
                    ``(B) in a motor vehicle while carrying carpooling 
                passengers.
    ``(c) Definitions Related to Commuting.--For purposes of this 
section--
            ``(1) Qualified commuting expenses.--The term `qualified 
        commuting expenses' means reasonable expenses paid or incurred 
        for transportation in connection with travel between an 
        individual's residence and place of employment.
            ``(2) Round-trip commute.--The term `round trip commute' 
        means the reasonable driving distance from an individual's 
        residence to such individual's place of employment and back to 
        such residence.''.
    (b) Clerical Amendment.--The table of sections for part VII of 
subchapter B of chapter 1 of such Code is amended by redesignating the 
item relating to section 224 as an item relating to section 225 and 
inserting before such item the following new item:

``Sec. 224. Certain commuting expenses.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 402. TAX CREDIT FOR FUEL EXPENSES OF TRUCKERS.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 (relating to business credits), as 
amended by this Act, is amended by adding at the end the following new 
section:

``SEC. 45S. CREDIT FOR FUEL EXPENSES OF TRUCKERS.

    ``(a) In General.--For purposes of section 38, the trucker fuel 
expense credit for any taxable year is an amount equal to 25 percent of 
the aggregate amount paid or incurred by the taxpayer for diesel fuel 
used by the taxpayer in the ordinary course of the trade or business of 
transporting goods by truck.
    ``(b) Limitation.--The credit determined under subsection (a) shall 
not exceed $2,500 with respect to any taxpayer for any taxable year.
    ``(c) Special Rules.--For purposes of this section--
            ``(1) 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 one 
        person.
            ``(2) Denial of double benefit.--No deduction or credit 
        shall be allowed under any other provision of this chapter with 
        respect to the amount of the credit determined under this 
        section.''.
    (b) Conforming Amendment.--Section 38(b) of such Code (relating to 
general business credit), as amended by this Act, is amended by 
striking ``plus'' at the end of paragraph (34), by striking the period 
at the end of paragraph (35) and inserting ``, plus'', and by adding at 
the end of following new paragraph:
            ``(36) the trucker fuel expense credit determined under 
        section 45S(a).''.
    (c) Clerical Amendment.--The table of sections for subpart B of 
part IV of subchapter A of chapter 1 of such Code (relating to other 
credits) is amended by adding at the end the following new section:
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

                      TITLE V--COAL-TO-LIQUID FUEL

               Subtitle A--Coal to Liquid Fuel Activities

SEC. 501. SHORT TITLE.

    This subtitle may be cited as the ``Coal-to-Liquid Fuel Promotion 
Act of 2008''.

SEC. 502. DEFINITIONS.

    In this subtitle:
            (1) Coal-to-liquid.--The term ``coal-to-liquid'' means--
                    (A) with respect to a process or technology, the 
                use of a feedstock, the majority of which is the coal 
                resources of the United States, using the class of 
                reactions known as Fischer-Tropsch, to produce 
                synthetic fuel suitable for transportation; and
                    (B) with respect to a facility, the portion of a 
                facility related to producing the inputs to the 
                Fischer-Tropsch process, the Fischer-Tropsch process, 
                finished fuel production, or the capture, 
                transportation, or sequestration of byproducts of the 
                use of a feedstock that is primarily domestic coal at 
                the Fischer-Tropsch facility, including carbon 
                emissions.
            (2) Secretary.--The term ``Secretary'' means the Secretary 
        of Energy.

SEC. 503. COAL-TO-LIQUID FUEL LOAN GUARANTEE PROGRAM.

    (a) Eligible Projects.--Section 1703(b) of the Energy Policy Act of 
2005 (42 U.S.C. 16513(b)) is amended by adding at the end the 
following:
            ``(11) Large-scale coal-to-liquid facilities (as defined in 
        section 502 of the Coal-to-Liquid Fuel Promotion Act of 2008) 
        that use a feedstock, the majority of which is the coal 
        resources of the United States, to produce not less than 10,000 
        barrels a day of liquid transportation fuel.''.
    (b) Authorization of Appropriations.--Section 1704 of the Energy 
Policy Act of 2005 (42 U.S.C. 16514) is amended by adding at the end 
the following:
    ``(c) Coal-to-Liquid Projects.--
            ``(1) In general.--There are authorized to be appropriated 
        such sums as are necessary to provide the cost of guarantees 
        for projects involving large-scale coal-to-liquid facilities 
        under section 1703(b)(11).
            ``(2) Alternative funding.--If no appropriations are made 
        available under paragraph (1), an eligible applicant may elect 
        to provide payment to the Secretary, to be delivered if and at 
        the time the application is approved, in the amount of the 
        estimated cost of the loan guarantee to the Federal Government, 
        as determined by the Secretary.
            ``(3) Limitations.--
                    ``(A) In general.--No loan guarantees shall be 
                provided under this title for projects described in 
                paragraph (1) after (as determined by the Secretary)--
                            ``(i) the tenth such loan guarantee is 
                        issued under this title; or
                            ``(ii) production capacity covered by such 
                        loan guarantees reaches 100,000 barrels per day 
                        of coal-to-liquid fuel.
                    ``(B) Individual projects.--
                            ``(i) In general.--A loan guarantee may be 
                        provided under this title for any large-scale 
                        coal-to-liquid facility described in paragraph 
                        (1) that produces no more than 20,000 barrels 
                        of coal-to-liquid fuel per day.
                            ``(ii) Non-federal funding requirement.--To 
                        be eligible for a loan guarantee under this 
                        title, a large-scale coal-to-liquid facility 
                        described in paragraph (1) that produces more 
                        than 20,000 barrels per day of coal-to-liquid 
                        fuel shall be eligible to receive a loan 
                        guarantee for the proportion of the cost of the 
                        facility that represents 20,000 barrels of 
                        coal-to-liquid fuel per day of production.
            ``(4) Requirements.--
                    ``(A) Guidelines.--Not later than 180 days after 
                the date of enactment of this subsection, the Secretary 
                shall publish guidelines for the coal-to-liquids loan 
                guarantee application process.
                    ``(B) Applications.--Not later than 1 year after 
                the date of enactment of this subsection, the Secretary 
                shall begin to accept applications for coal-to-liquid 
                loan guarantees under this subsection.
                    ``(C) Deadline.--Not later than 1 year from the 
                date of acceptance of an application under subparagraph 
                (B), the Secretary shall evaluate the application and 
                make final determinations under this subsection.
            ``(5) Reports to congress.--The Secretary shall submit to 
        the Committee on Energy and Natural Resources of the Senate and 
        the Committee on Energy and Commerce of the House of 
        Representatives a report describing the status of the program 
        under this subsection not later than each of--
                    ``(A) 180 days after the date of enactment of this 
                subsection;
                    ``(B) 1 year after the date of enactment of this 
                subsection; and
                    ``(C) the dates on which the Secretary approves the 
                first and fifth applications for coal-to-liquid loan 
                guarantees under this subsection.''.

SEC. 504. COAL-TO-LIQUID FACILITIES LOAN PROGRAM.

    (a) Definition of Eligible Recipient.--In this section, the term 
``eligible recipient'' means an individual, organization, or other 
entity that owns, operates, or plans to construct a coal-to-liquid 
facility that will produce at least 10,000 barrels per day of coal-to-
liquid fuel.
    (b) Establishment.--The Secretary shall establish a program under 
which the Secretary shall provide loans, in a total amount not to 
exceed $20,000,000, for use by eligible recipients to pay the Federal 
share of the cost of obtaining any services necessary for the planning, 
permitting, and construction of a coal-to-liquid facility.
    (c) Application.--To be eligible to receive a loan under subsection 
(b), the eligible recipient shall submit to the Secretary an 
application at such time, in such manner, and containing such 
information as the Secretary may require.
    (d) Non-Federal Match.--To be eligible to receive a loan under this 
section, an eligible recipient shall use non-Federal funds to provide a 
dollar-for-dollar match of the amount of the loan.
    (e) Repayment of Loan.--
            (1) In general.--To be eligible to receive a loan under 
        this section, an eligible recipient shall agree to repay the 
        original amount of the loan to the Secretary not later than 5 
        years after the date of the receipt of the loan.
            (2) Source of funds.--Repayment of a loan under paragraph 
        (1) may be made from any financing or assistance received for 
        the construction of a coal-to-liquid facility described in 
        subsection (a), including a loan guarantee provided under 
        section 1703(b)(11) of the Energy Policy Act of 2005 (42 U.S.C. 
        16513(b)(11)).
    (f) Requirements.--
            (1) Guidelines.--Not later than 180 days after the date of 
        enactment of this Act, the Secretary shall publish guidelines 
        for the coal-to-liquids loan application process.
            (2) Applications.--Not later than 1 year after the date of 
        enactment of this Act, the Secretary shall begin to accept 
        applications for coal-to-liquid loans under this section.
    (g) Reports to Congress.--Not later than each of 180 days and 1 
year after the date of enactment of this Act, the Secretary shall 
submit to the Committee on Energy and Natural Resources of the Senate 
and the Committee on Energy and Commerce of the House of 
Representatives a report describing the status of the program under 
this section.
    (h) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $200,000,000, to remain 
available until expended.

SEC. 505. LOCATION OF COAL-TO-LIQUID MANUFACTURING FACILITIES.

    The Secretary, in coordination with the head of any affected 
agency, shall promulgate such regulations as the Secretary determines 
to be necessary to support the development on Federal land (including 
land of the Department of Energy, military bases, and military 
installations closed or realigned under the defense base closure and 
realignment) of coal-to-liquid manufacturing facilities and associated 
infrastructure, including the capture, transportation, or sequestration 
of carbon dioxide.

SEC. 506. STRATEGIC PETROLEUM RESERVE.

    (a) Development, Operation, and Maintenance of Reserve.--Section 
159 of the Energy Policy and Conservation Act (42 U.S.C. 6239) is 
amended--
            (1) by redesignating subsections (f), (g), (j), (k), and 
        (l) as subsections (a), (b), (e), (f), and (g), respectively; 
        and
            (2) by inserting after subsection (b) (as redesignated by 
        paragraph (1)) the following:
    ``(c) Study of Maintaining Coal-to-Liquid Products in Reserve.--Not 
later than 1 year after the date of enactment of the Coal-to-Liquid 
Fuel Promotion Act of 2008, the Secretary and the Secretary of Defense 
shall--
            ``(1) conduct a study of the feasibility and suitability of 
        maintaining coal-to-liquid products in the Reserve; and
            ``(2) submit to the Committee on Energy and Natural 
        Resources and the Committee on Armed Services of the Senate and 
        the Committee on Energy and Commerce and the Committee on Armed 
        Services of the House of Representatives a report describing 
        the results of the study.
    ``(d) Construction of Storage Facilities.--As soon as practicable 
after the date of enactment of the Coal-to-Liquid Fuel Promotion Act of 
2008, the Secretary may construct 1 or more storage facilities in the 
vicinity of pipeline infrastructure and at least 1 military base.''.
    (b) Petroleum Products for Storage in Reserve.--Section 160 of the 
Energy Policy and Conservation Act (42 U.S.C. 6240) is amended--
            (1) in subsection (a)--
                    (A) in paragraph (1), by inserting a semicolon at 
                the end;
                    (B) in paragraph (2), by striking ``and'' at the 
                end;
                    (C) in paragraph (3), by striking the period at the 
                end and inserting ``; and''; and
                    (D) by adding at the end the following:
            ``(4) coal-to-liquid products (as defined in section 502 of 
        the Coal-to-Liquid Fuel Promotion Act of 2008), as the 
        Secretary determines to be appropriate, in a quantity not to 
        exceed 20 percent of the total quantity of petroleum and 
        petroleum products in the Reserve.'';
            (2) in subsection (b), by redesignating paragraphs (3) 
        through (5) as paragraphs (2) through (4), respectively; and
            (3) by redesignating subsections (f) and (h) as subsections 
        (d) and (e), respectively.
    (c) Conforming Amendments.--Section 167 of the Energy Policy and 
Conservation Act (42 U.S.C. 6247) is amended--
            (1) in subsection (b)--
                    (A) by redesignating paragraphs (2) and (3) as 
                paragraphs (1) and (2), respectively; and
                    (B) in paragraph (2) (as redesignated by 
                subparagraph (A)), by striking ``section 160(f)'' and 
                inserting ``section 160(e)''; and
            (2) in subsection (d), in the matter preceding paragraph 
        (1), by striking ``section 160(f)'' and inserting ``section 
        160(e)''.

SEC. 507. AUTHORIZATION TO CONDUCT RESEARCH, DEVELOPMENT, TESTING, AND 
              EVALUATION OF ASSURED DOMESTIC FUELS.

    Of the amount authorized to be appropriated for the Air Force for 
research, development, testing, and evaluation, $10,000,000 may be made 
available for the Air Force Research Laboratory to continue support 
efforts to test, qualify, and procure synthetic fuels developed from 
coal for aviation jet use.

SEC. 508. COAL-TO-LIQUID LONG-TERM FUEL PROCUREMENT AND DEPARTMENT OF 
              DEFENSE DEVELOPMENT.

    Section 2398a of title 10, United States Code is amended--
            (1) in subsection (b)--
                    (A) by striking ``The Secretary'' and inserting the 
                following:
            ``(1) In general.--The Secretary''; and
                    (B) by adding at the end the following:
            ``(2) Coal-to-liquid production facilities.--
                    ``(A) In general.--The Secretary of Defense may 
                enter into contracts or other agreements with private 
                companies or other entities to develop and operate 
                coal-to-liquid facilities (as defined in section 502 of 
                the Coal-to-Liquid Fuel Promotion Act of 2008) on or 
                near military installations.
                    ``(B) Considerations.--In entering into contracts 
                and other agreements under subparagraph (A), the 
                Secretary shall consider land availability, testing 
                opportunities, and proximity to raw materials.'';
            (2) in subsection (d)--
                    (A) by striking ``Subject to applicable provisions 
                of law, any'' and inserting ``Any''; and
                    (B) by striking ``1 or more years'' and inserting 
                ``up to 25 years''; and
            (3) by adding at the end the following:
    ``(f) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as are necessary to carry out this section.''.

SEC. 509. REPORT ON EMISSIONS OF FISCHER-TROPSCH PRODUCTS USED AS 
              TRANSPORTATION FUELS.

    (a) In General.--In cooperation with the Administrator of the 
Environmental Protection Agency, the Secretary of Defense, the 
Administrator of the Federal Aviation Administration, and the Secretary 
of Health and Human Services, the Secretary shall--
            (1) carry out a research and demonstration program to 
        evaluate the emissions of the use of Fischer-Tropsch fuel for 
        transportation, including diesel and jet fuel;
            (2) evaluate the effect of using Fischer-Tropsch 
        transportation fuel on land and air engine exhaust emissions; 
        and
            (3) in accordance with subsection (e), submit to Congress a 
        report on the effect on air quality and public health of using 
        Fischer-Tropsch fuel in the transportation sector.
    (b) Guidance and Technical Support.--The Secretary shall issue any 
guidance or technical support documents necessary to facilitate the 
effective use of Fischer-Tropsch fuel and blends under this section.
    (c) Facilities.--For the purpose of evaluating the emissions of 
Fischer-Tropsch transportation fuels, the Secretary shall--
            (1) support the use and capital modification of existing 
        facilities and the construction of new facilities at the 
        research centers designated in section 417 of the Energy Policy 
        Act of 2005 (42 U.S.C. 15977); and
            (2) engage those research centers in the evaluation and 
        preparation of the report required under subsection (a)(3).
    (d) Requirements.--The program described in subsection (a)(1) shall 
consider--
            (1) the use of neat (100 percent) Fischer-Tropsch fuel and 
        blends of Fischer-Tropsch fuels with conventional crude oil-
        derived fuel for heavy-duty and light-duty diesel engines and 
        the aviation sector; and
            (2) the production costs associated with domestic 
        production of those fuels and prices for consumers.
    (e) Reports.--The Secretary shall submit to the Committee on Energy 
and Natural Resources of the Senate and the Committee on Energy and 
Commerce of the House of Representatives--
            (1) not later than 180 days after the date of enactment of 
        this Act, an interim report on actions taken to carry out this 
        section; and
            (2) not later than 1 year after the date of enactment of 
        this Act, a final report on actions taken to carry out this 
        section.
    (f) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as are necessary to carry out this section.

      Subtitle B--Amendments to the Internal Revenue Code of 1986

SEC. 511. CREDIT FOR INVESTMENT IN COAL-TO-LIQUID FUELS PROJECTS.

    (a) In General.--Section 46 of the Internal Revenue Code of 1986 
(relating to amount of credit) 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 coal-to-liquid fuels project 
        credit.''.
    (b) Amount of Credit.--Subpart E of part IV of subchapter A of 
chapter 1 of the Internal Revenue Code of 1986 (relating to rules for 
computing investment credit) is amended by inserting after section 48B 
the following new section:

``SEC. 48C. QUALIFYING COAL-TO-LIQUID FUELS PROJECT CREDIT.

    ``(a) In General.--For purposes of section 46, the qualifying coal-
to-liquid fuels project credit for any taxable year is an amount equal 
to 20 percent of the qualified investment for such taxable year.
    ``(b) Qualified Investment.--
            ``(1) In general.--For purposes of subsection (a), the 
        qualified investment for any taxable year is the basis of 
        property placed in service by the taxpayer during such taxable 
        year which is part of a qualifying coal-to-liquid fuels 
        project--
                    ``(A)(i) the construction, reconstruction, or 
                erection of which is completed by the taxpayer, or
                    ``(ii) which is acquired by the taxpayer if the 
                original use of such property commences with the 
                taxpayer, and
                    ``(B) with respect to which depreciation (or 
                amortization in lieu of depreciation) is allowable.
            ``(2) Applicable rules.--For purposes of this section, 
        rules similar to the rules of subsection (a)(4) and (b) of 
        section 48 shall apply.
    ``(c) Definitions.--For purposes of this section--
            ``(1) Qualifying coal-to-liquid fuels project.--The term 
        `qualifying coal-to-liquid fuels project' means any domestic 
        project which--
                    ``(A) employs the class of reactions known as 
                Fischer-Tropsch to produce at least 10,000 barrels per 
                day of transportation grade liquid fuels from a 
                feedstock that is primarily domestic coal (including 
                any property which allows for the capture, 
                transportation, or sequestration of by-products 
                resulting from such process, including carbon 
                emissions), and
                    ``(B) any portion of the qualified investment in 
                which is certified under the qualifying coal-to-liquid 
                program as eligible for credit under this section in an 
                amount (not to exceed $200,000,000) determined by the 
                Secretary.
            ``(2) Coal.--The term `coal' means any carbonized or 
        semicarbonized matter, including peat.
    ``(d) Qualifying Coal-to-Liquid Fuels Project Program.--
            ``(1) In general.--The Secretary, in consultation with the 
        Secretary of Energy, shall establish a qualifying coal-to-
        liquid fuels project program to consider and award 
        certifications for qualified investment eligible for credits 
        under this section to 10 qualifying coal-to-liquid fuels 
        project sponsors under this section. The total qualified 
        investment which may be awarded eligibility for credit under 
        the program shall not exceed $2,000,000,000.
            ``(2) Period of issuance.--A certificate of eligibility 
        under paragraph (1) may be issued only during the 10-fiscal 
        year period beginning on October 1, 2007.
            ``(3) Selection criteria.--The Secretary shall not make a 
        competitive certification award for qualified investment for 
        credit eligibility under this section unless the recipient has 
        documented to the satisfaction of the Secretary that--
                    ``(A) the proposal of the award recipient is 
                financially viable,
                    ``(B) the recipient will provide sufficient 
                information to the Secretary for the Secretary to 
                ensure that the qualified investment is spent 
                efficiently and effectively,
                    ``(C) the fuels identified with respect to the 
                gasification technology for such project will comprise 
                at least 90 percent of the fuels required by the 
                project for the production of transportation grade 
                liquid fuels,
                    ``(D) the award recipient's project team is 
                competent in the planning and construction of coal 
                gasification facilities and familiar with operation of 
                the Fischer-Tropsch process, with preference given to 
                those recipients with experience which demonstrates 
                successful and reliable operations of such process, and
                    ``(E) the award recipient has met other criteria 
                established and published by the Secretary.
    ``(e) Denial of Double Benefit.--No deduction or other credit shall 
be allowed with respect to the basis of any property taken into account 
in determining the credit allowed under this section.''.
    (c) Conforming Amendments.--
            (1) Section 49(a)(1)(C) of the Internal Revenue Code of 
        1986 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 after clause (iv) the following new 
        clause:
                            ``(v) the basis of any property which is 
                        part of a qualifying coal-to-liquid fuels 
                        project under section 48C.''.
            (2) The table of sections for subpart E of part IV of 
        subchapter A of chapter 1 of such Code is amended by inserting 
        after the item relating to section 48B the following new item:

``Sec. 48C. Qualifying coal-to-liquid fuels project credit.''.
    (d) 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. 512. TEMPORARY EXPENSING FOR EQUIPMENT USED IN COAL-TO-LIQUID 
              FUELS PROCESS.

    (a) In General.--Part VI of subchapter B of chapter 1 of the 
Internal Revenue Code of 1986 is amended by inserting after section 
179E the following new section:

``SEC. 179F. ELECTION TO EXPENSE CERTAIN COAL-TO-LIQUID FUELS 
              FACILITIES.

    ``(a) Treatment as Expenses.--A taxpayer may elect to treat the 
cost of any qualified coal-to-liquid fuels process property as an 
expense which is not chargeable to capital account. Any cost so treated 
shall be allowed as a deduction for the taxable year in which the 
expense is incurred.
    ``(b) Election.--
            ``(1) In general.--An election under this section for any 
        taxable year shall be made on the taxpayer's return of the tax 
        imposed by this chapter for the taxable year. Such election 
        shall be made in such manner as the Secretary may by 
        regulations prescribe.
            ``(2) Election irrevocable.--Any election made under this 
        section may not be revoked except with the consent of the 
        Secretary.
    ``(c) Qualified Coal-to-Liquid Fuels Process Property.--The term 
`qualified coal-to-liquid fuels process property' means any property 
located in the United States--
            ``(1) which employs the Fischer-Tropsch process to produce 
        transportation grade liquid fuels from a feedstock that is 
        primarily domestic coal (including any property which allows 
        for the capture, transportation, or sequestration of by-
        products resulting from such process, including carbon 
        emissions),
            ``(2) the original use of which commences with the 
        taxpayer,
            ``(3) the construction of which--
                    ``(A) except as provided in subparagraph (B), is 
                subject to a binding construction contract entered into 
                after the date of the enactment of this section and 
                before January 1, 2011, but only if there was no 
                written binding construction contract entered into on 
                or before such date of enactment, or
                    ``(B) in the case of self-constructed property, 
                began after the date of the enactment of this section 
                and before January 1, 2011, and
            ``(4) which is placed in service by the taxpayer after the 
        date of the enactment of this section and before January 1, 
        2016.
    ``(d) Election To Allocate Deduction to Cooperative Owner.--If--
            ``(1) a taxpayer to which subsection (a) applies is an 
        organization to which part I of subchapter T applies, and
            ``(2) one or more persons directly holding an ownership 
        interest in the taxpayer are organizations to which part I of 
        subchapter T apply,
the taxpayer may elect to allocate all or a portion of the deduction 
allowable under subsection (a) to such persons. Such allocation shall 
be equal to the person's ratable share of the total amount allocated, 
determined on the basis of the person's ownership interest in the 
taxpayer. The taxable income of the taxpayer shall not be reduced under 
section 1382 by reason of any amount to which the preceding sentence 
applies.
    ``(e) Basis Reduction.--
            ``(1) In general.--For purposes of this title, if a 
        deduction is allowed under this section with respect to any 
        qualified coal-to-liquid fuels process property, 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 which is of a character 
        subject to the allowance for depreciation shall be treated as a 
        deduction allowed for depreciation under section 167.
    ``(f) Application With Other Deductions and Credits.--
            ``(1) Other deductions.--No deduction shall be allowed 
        under any other provision of this chapter with respect to any 
        expenditure with respect to which a deduction is allowed under 
        subsection (a) to the taxpayer.
            ``(2) Credits.--No credit shall be allowed under section 38 
        with respect to any amount for which a deduction is allowed 
        under subsection (a).
    ``(g) Reporting.--No deduction shall be allowed under subsection 
(a) to any taxpayer for any taxable year unless such taxpayer files 
with the Secretary a report containing such information with respect to 
the operation of the property of the taxpayer as the Secretary shall 
require.''.
    (b) Conforming Amendments.--
            (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 179F(e)(1).''.
            (2) Section 1245(a) of such Code is amended by inserting 
        ``179F,'' after ``179D,'' both places it appears in paragraphs 
        (2)(C) and (3)(C).
            (3) Section 263(a)(1) of such Code 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 179F.''.
            (4) Section 312(k)(3)(B) of such Code is amended by 
        striking ``or 179E'' each place it appears in the heading and 
        text and inserting ``179E, or 179F''.
            (5) The table of sections for part VI of subchapter B of 
        chapter 1 of such Code is amended by inserting after the item 
        relating to section 179E the following new item:

``Sec. 179F. Election to expense certain coal-to-liquid fuels 
                            facilities.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to properties placed in service after the date of the enactment 
of this Act.

SEC. 513. EXTENSION OF ALTERNATIVE FUEL CREDIT FOR FUEL DERIVED FROM 
              COAL THROUGH THE FISCHER-TROPSCH PROCESS.

    (a) Alternative Fuel Credit.--Paragraph (4) of section 6426(d) of 
the Internal Revenue Code of 1986 is amended to read as follows:
            ``(4) Termination.--This subsection shall not apply to--
                    ``(A) any sale or use involving liquid fuel derived 
                from a feedstock that is primarily domestic coal 
                (including peat) through the Fischer-Tropsch process 
                for any period after September 30, 2020,
                    ``(B) any sale or use involving liquified hydrogen 
                for any period after September 30, 2014, and
                    ``(C) any other sale or use for any period after 
                September 30, 2009.''.
    (b) Payments.--
            (1) In general.--Paragraph (5) of section 6427(e) of the 
        Internal Revenue Code of 1986 is amended by striking ``and'' 
        and the end of subparagraph (C), by striking the period at the 
        end of subparagraph (D) and inserting ``, and'', and by adding 
        at the end the following new subparagraph:
                    ``(E) any alternative fuel or alternative fuel 
                mixture (as so defined) involving liquid fuel derived 
                from coal (including peat) through the Fischer-Tropsch 
                process sold or used after September 30, 2020.''.
            (2) Conforming amendment.--Section 6427(e)(5)(C) of such 
        Code is amended by striking ``subparagraph (D)'' and inserting 
        ``subparagraphs (D) and (E)''.

SEC. 514. MODIFICATIONS TO ENHANCED OIL RECOVERY CREDIT.

    (a) Enhanced Credit for Carbon Dioxide Injections.--Section 43 of 
the Internal Revenue Code of 1986 is amended by adding at the end the 
following new subsection:
    ``(f) Enhanced Credit for Projects Using Qualified Carbon 
Dioxide.--
            ``(1) In general.--For purposes of this section--
                    ``(A) the term `qualified project' includes a 
                project described in paragraph (2), and
                    ``(B) in the case of a project described in 
                paragraph (2), subsection (a) shall be applied by 
                substituting `50 percent' for `15 percent'.
            ``(2) Projects described.--A project is described in this 
        paragraph if it begins or is substantially expanded after 
        December 31, 2007, and
                    ``(A) uses qualified carbon dioxide in an enhanced 
                oil, natural gas, or coalbed methane recovery method, 
                which involves flooding or injection, or
                    ``(B) enables the capture or sequestration of 
                qualified carbon dioxide.
            ``(3) Definitions.--For purposes of this subsection--
                    ``(A) Enhanced oil recovery.--The term `enhanced 
                oil recovery' means recovery of oil by injecting or 
                flooding with qualified carbon dioxide.
                    ``(B) Enhanced natural gas recovery.--The term 
                `enhanced natural gas recovery' means recovery of 
                natural gas by injecting or flooding with qualified 
                carbon dioxide.
                    ``(C) Enhanced coalbed methane recovery.--The term 
                `enhanced coalbed methane recovery' means recovery of 
                coalbed methane by injecting or flooding with qualified 
                carbon dioxide.
                    ``(D) Qualified carbon dioxide.--The term 
                `qualified carbon dioxide' means carbon dioxide which 
                is produced from the gasification and subsequent 
                refinement of a feedstock which is primarily domestic 
                coal, at a facility which produces coal-to-liquid fuel.
                    ``(E) Capture or sequestration.--The term `capture 
                or sequestration' means any equipment or facility 
                necessary to--
                            ``(i) capture or separate qualified carbon 
                        dioxide from other emissions,
                            ``(ii) transport qualified carbon dioxide, 
                        or
                            ``(iii) process and use qualified carbon 
                        dioxide in a qualified project.
            ``(4) Termination.--This subsection shall not apply to 
        costs paid or incurred for any qualified project after December 
        31, 2020.''.
    (b) Conforming Amendments.--
            (1) Section 43 of the Internal Revenue Code of 1986 is 
        amended--
                    (A) by striking ``enhanced oil recovery credit'' in 
                subsection (a) and inserting ``enhanced oil, natural 
                gas, and coalbed methane recovery, and capture and 
                sequestration credit'',
                    (B) by striking ``qualified enhanced oil recovery 
                costs'' each place it appears and inserting ``qualified 
                costs'',
                    (C) by striking ``qualified enhanced oil recovery 
                project'' each place it appears and inserting 
                ``qualified project'', and
                    (D) by striking the heading and inserting:

``SEC. 43. ENHANCED OIL, NATURAL GAS, AND COALBED METHANE RECOVERY, AND 
              CAPTURE AND SEQUESTRATION CREDIT.''.

            (2) The item in the table of sections for subpart D of part 
        IV of subchapter A of chapter 1 of such Code relating to 
        section 43 is amended to read as follows:

``Sec. 43. Enhanced oil, natural gas, and coalbed methane recovery, and 
                            capture and sequestration credit.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to costs paid or incurred in taxable years ending after December 
31, 2007.

SEC. 515. ALLOWANCE OF ENHANCED OIL, NATURAL GAS, AND COALBED METHANE 
              RECOVERY, AND CAPTURE AND SEQUESTRATION CREDIT AGAINST 
              THE ALTERNATIVE MINIMUM TAX.

    (a) In General.--Subsection (c) of section 38 of the Internal 
Revenue Code of 1986 (relating to limitation based on amount of tax) 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) Special rules for enhanced oil, natural gas, and 
        coalbed methane recovery, and capture and sequestration 
        credit.--In the case of the enhanced oil, natural gas, and 
        coalbed methane recovery, and capture and sequestration credit 
        determined under section 43--
                    ``(A) this section and section 39 shall be applied 
                separately with respect to such credit, and
                    ``(B) in applying paragraph (1) to such credit--
                            ``(i) the tentative minimum tax shall be 
                        treated as being zero, and
                            ``(ii) the limitation under paragraph (1) 
                        (as modified by clause (i)) shall be reduced by 
                        the credit allowed under subsection (a) for the 
                        taxable year (other than the enhanced oil, 
                        natural gas, and coalbed methane recovery, and 
                        capture and sequestration credit and the 
                        specified credits).''.
    (b) Conforming Amendments.--
            (1) Section 38(c)(2)(A)(ii)(II) of such Code is amended by 
        inserting ``the enhanced oil, natural gas, and coalbed methane 
        recovery, and capture and sequestration credit,'' after 
        ``employee credit,''.
            (2) Section 38(c)(3)(A)(ii)(II) of such Code is amended by 
        inserting ``, the enhanced oil, natural gas, coalbed methane 
        recovery, capture and sequestration credit,'' after ``employee 
        credit''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after December 31, 2007.

           TITLE VI--ENERGY EFFICIENT TAX CREDIT FOR VEHICLES

SEC. 601. CREDIT FOR HYBRIDS AND PLUG-IN HYBRIDS.

    (a) In General.--Subparagraph (A) of section 30B(d)(2) of the 
Internal Revenue Code of 1986 (relating to credit amount for passenger 
automobiles and light trucks) is amended to read as follows:
                    ``(A) Credit amount for passenger automobiles and 
                light trucks.--
                            ``(i) In general.--In the case of a new 
                        qualified hybrid motor vehicle (other than a 
                        new qualified plug-in hybrid motor vehicle) 
                        which is a passenger automobile or light truck 
                        and which has a gross vehicle weight rating of 
                        not more than 8,500 pounds, the amount 
                        determined under this paragraph is the sum of 
                        the amounts determined under subclauses (I), 
                        (II), and (III).
                                    ``(I) Fuel economy.--The amount 
                                determined under this subclause is the 
                                amount which would be determined under 
                                subsection (c)(2)(A) if such vehicle 
                                were a vehicle referred to in such 
                                subsection.
                                    ``(II) Conservation credit.--The 
                                amount determined under this subclause 
                                is the amount which would be determined 
                                under subsection (c)(2)(B) if such 
                                vehicle were a vehicle referred to in 
                                such subsection.
                                    ``(III) Domestic acquisition.--In 
                                the case of a vehicle acquired for use 
                                or lease by the taxpayer from a 
                                domestic corporation, $1,000.
                            ``(ii) New qualified plug-in hybrid motor 
                        vehicles.--In the case of a new qualified plug-
                        in hybrid motor vehicle which is a passenger 
                        automobile or light truck and which has a gross 
                        vehicle weight rating of not more than 8,500 
                        pounds, the amount determined under this 
                        paragraph is the sum of the amounts determined 
                        under subclauses (I), (II), (III), and (IV).
                                    ``(I) Base amount.--The amount 
                                determined under this subclause is 
                                $3,000.
                                    ``(II) Flexible fuel.--In the case 
                                of a vehicle which is warrantied by its 
                                manufacturer to operate on a fuel 
                                described in section 30C(c)(1)(A), the 
                                amount determined under this subclause 
                                is $150.
                                    ``(III) Power of traction 
                                battery.--In the case of vehicle which 
                                draws propulsion energy from a traction 
                                battery of not less than 5 kWh, the 
                                amount determined under this subclause 
                                is $500, plus $250 for each kWh that 
                                such battery exceeds 5 kWh. The amount 
                                determined under this subclause shall 
                                not exceed $3,000.
                                    ``(IV) Domestic acquisition.--In 
                                the case of a vehicle acquired for use 
                                or lease by the taxpayer from a 
                                domestic corporation, $1,000.''.
    (b) New Qualified Plug-In Hybrid Motor Vehicle.--Subsection (d) of 
section 30B of such Code is amended by adding at the end the following 
new paragraph:
            ``(4) New qualified plug-in hybrid motor vehicle.--For 
        purposes of this subsection, the term `new qualified plug-in 
        hybrid motor vehicle' means any new qualified hybrid motor 
        vehicle which--
                    ``(A) meets or exceeds the Bin 5 Tier II emission 
                standard 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,
                    ``(B) draws propulsion energy from a traction 
                battery of not less than 4 kWh, and
                    ``(C) is equipped with a means of recharging its 
                rechargeable energy storage system from an external 
                source of electricity.''.
    (c) Application of Limitation on Number of Hybrids Eligible for 
Credit.--
            (1) In general.--Subsection (f) of section 30B of such Code 
        is amended by adding at the end the following new paragraph:
            ``(6) Separate application to new qualified plug-in hybrid 
        motor vehicles.--In the case of a new qualified plug-in hybrid 
        motor vehicle, this subsection shall be applied--
                    ``(A) separately with respect to such vehicles by 
                treating only new qualified plug-in hybrid motor 
                vehicles as qualified vehicles,
                    ``(B) by substituting `100,000' for `60,000' in 
                paragraph (2), and
                    ``(C) by substituting `the date of the enactment of 
                paragraph (6)' for `December 31, 2005' in paragraph 
                (2).''.
            (2) Conforming amendment.--Paragraph (5) of section 30B(f) 
        of such Code is amended by inserting ``other than a new 
        qualified plug-in hybrid motor vehicle'' after ``subsection 
        (d)(2)(A)''.
    (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.

        TITLE VII--EXTENSION AND MODIFICATION OF TAX PROVISIONS

SEC. 700. SHORT TITLE; ETC.

    (a) Short Title.--This title may be cited as the ``Clean Energy Tax 
Stimulus Act of 2008''.
    (b) Amendment of 1986 Code.--Except as otherwise expressly 
provided, whenever in this title 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.

      Subtitle A--Extension of Clean Energy Production Incentives

SEC. 701. EXTENSION AND MODIFICATION OF RENEWABLE ENERGY PRODUCTION TAX 
              CREDIT.

    (a) Extension of Credit.--Each of the following provisions of 
section 45(d) (relating to qualified facilities) is amended by striking 
``January 1, 2009'' and inserting ``January 1, 2010'':
            (1) Paragraph (1).
            (2) Clauses (i) and (ii) of paragraph (2)(A).
            (3) Clauses (i)(I) and (ii) of paragraph (3)(A).
            (4) Paragraph (4).
            (5) Paragraph (5).
            (6) Paragraph (6).
            (7) Paragraph (7).
            (8) Paragraph (8).
            (9) Subparagraphs (A) and (B) of paragraph (9).
    (b) Production Credit for Electricity Produced From Marine 
Renewables.--
            (1) In general.--Paragraph (1) of section 45(c) (relating 
        to resources) is amended by striking ``and'' at the end of 
        subparagraph (G), by striking the period at the end of 
        subparagraph (H) and inserting ``, and'', and by adding at the 
        end the following new subparagraph:
                    ``(I) marine and hydrokinetic renewable energy.''.
            (2) Marine renewables.--Subsection (c) of section 45 is 
        amended by adding at the end the following new paragraph:
            ``(10) Marine and hydrokinetic renewable energy.--
                    ``(A) In general.--The term `marine and 
                hydrokinetic renewable energy' means energy derived 
                from--
                            ``(i) waves, tides, and currents in oceans, 
                        estuaries, and tidal areas,
                            ``(ii) free flowing water in rivers, lakes, 
                        and streams,
                            ``(iii) free flowing water in an irrigation 
                        system, canal, or other man-made channel, 
                        including projects that utilize nonmechanical 
                        structures to accelerate the flow of water for 
                        electric power production purposes, or
                            ``(iv) differentials in ocean temperature 
                        (ocean thermal energy conversion).
                    ``(B) Exceptions.--Such term shall not include any 
                energy which is derived from any source which utilizes 
                a dam, diversionary structure (except as provided in 
                subparagraph (A)(iii)), or impoundment for electric 
                power production purposes.''.
            (3) Definition of facility.--Subsection (d) of section 45 
        is amended by adding at the end the following new paragraph:
            ``(11) Marine and hydrokinetic renewable energy 
        facilities.--In the case of a facility producing electricity 
        from marine and hydrokinetic renewable energy, the term 
        `qualified facility' means any facility owned by the taxpayer--
                    ``(A) which has a nameplate capacity rating of at 
                least 150 kilowatts, and
                    ``(B) which is originally placed in service on or 
                after the date of the enactment of this paragraph and 
                before January 1, 2010.''.
            (4) Credit rate.--Subparagraph (A) of section 45(b)(4) is 
        amended by striking ``or (9)'' and inserting ``(9), or (11)''.
            (5) Coordination with small irrigation power.--Paragraph 
        (5) of section 45(d), as amended by subsection (a), is amended 
        by striking ``January 1, 2010'' and inserting ``the date of the 
        enactment of paragraph (11)''.
    (c) Sales of Electricity to Regulated Public Utilities Treated as 
Sales to Unrelated Persons.--Section 45(e)(4) (relating to related 
persons) is amended by adding at the end the following new sentence: 
``A taxpayer shall be treated as selling electricity to an unrelated 
person if such electricity is sold to a regulated public utility (as 
defined in section 7701(a)(33).''.
    (d) Trash Facility Clarification.--Paragraph (7) of section 45(d) 
is amended--
            (1) by striking ``facility which burns'' and inserting 
        ``facility (other than a facility described in paragraph (6)) 
        which uses'', and
            (2) by striking ``combustion''.
    (e) Effective Dates.--
            (1) Extension.--The amendments made by subsection (a) shall 
        apply to property originally placed in service after December 
        31, 2008.
            (2) Modifications.--The amendments made by subsections (b) 
        and (c) shall apply to electricity produced and sold after the 
        date of the enactment of this Act, in taxable years ending 
        after such date.
            (3) Trash facility clarification.--The amendments made by 
        subsection (d) shall apply to electricity produced and sold 
        before, on, or after December 31, 2007.

SEC. 702. EXTENSION AND MODIFICATION OF SOLAR ENERGY AND FUEL CELL 
              INVESTMENT TAX CREDIT.

    (a) Extension of Credit.--
            (1) Solar energy property.--Paragraphs (2)(A)(i)(II) and 
        (3)(A)(ii) of section 48(a) (relating to energy credit) are 
        each amended by striking ``January 1, 2009'' and inserting 
        ``January 1, 2017''.
            (2) Fuel cell property.--Subparagraph (E) of section 
        48(c)(1) (relating to qualified fuel cell property) is amended 
        by striking ``December 31, 2008'' and inserting ``December 31, 
        2016''.
            (3) Qualified microturbine property.--Subparagraph (E) of 
        section 48(c)(2) (relating to qualified microturbine property) 
        is amended by striking ``December 31, 2008'' and inserting 
        ``December 31, 2016''.
    (b) Allowance of Energy Credit Against Alternative Minimum Tax.--
Subparagraph (B) of section 38(c)(4) (relating to specified credits) 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) the credit determined under section 
                        46 to the extent that such credit is 
                        attributable to the energy credit determined 
                        under section 48.''.
    (c) Repeal of Dollar Per Kilowatt Limitation for Fuel Cell 
Property.--
            (1) In general.--Section 48(c)(1) (relating to qualified 
        fuel cell), as amended by subsection (a)(2), is amended by 
        striking subparagraph (B) and by redesignating subparagraphs 
        (C), (D), and (E) as subparagraphs (B), (C), and (D), 
        respectively.
            (2) Conforming amendment.--Section 48(a)(1) is amended by 
        striking ``paragraphs (1)(B) and (2)(B) of subsection (c)'' and 
        inserting ``subsection (c)(2)(B)''.
    (d) Public Electric Utility Property Taken Into Account.--
            (1) In general.--Paragraph (3) of section 48(a) is amended 
        by striking the second sentence thereof.
            (2) Conforming amendments.--
                    (A) Paragraph (1) of section 48(c), as amended by 
                this section, is amended by striking subparagraph (C) 
                and redesignating subparagraph (D) as subparagraph (C).
                    (B) Paragraph (2) of section 48(c), as amended by 
                subsection (a)(3), is amended by striking subparagraph 
                (D) and redesignating subparagraph (E) as subparagraph 
                (D).
    (e) Effective Dates.--
            (1) Extension.--The amendments made by subsection (a) shall 
        take effect on the date of the enactment of this Act.
            (2) Allowance against alternative minimum tax.--The 
        amendments made by subsection (b) shall apply to credits 
        determined under section 46 of the Internal Revenue Code of 
        1986 in taxable years beginning after the date of the enactment 
        of this Act and to carrybacks of such credits.
            (3) Fuel cell property and public electric utility 
        property.--The amendments made by subsections (c) and (d) shall 
        apply to periods after the date of the enactment of this Act, 
        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).

SEC. 703. EXTENSION AND MODIFICATION OF RESIDENTIAL ENERGY EFFICIENT 
              PROPERTY CREDIT.

    (a) Extension.--Section 25D(g) (relating to termination) is amended 
by striking ``December 31, 2008'' and inserting ``December 31, 2009''.
    (b) No Dollar Limitation for Credit for Solar Electric Property.--
            (1) In general.--Section 25D(b)(1) (relating to maximum 
        credit) is amended by striking subparagraph (A) and by 
        redesignating subparagraphs (B) and (C) as subparagraphs (A) 
        and (B), respectively.
            (2) Conforming amendments.--Section 25D(e)(4) is amended--
                    (A) by striking clause (i) in subparagraph (A),
                    (B) by redesignating clauses (ii) and (iii) in 
                subparagraph (A) as clauses (i) and (ii), respectively, 
                and
                    (C) by striking ``, (2),'' in subparagraph (C).
    (c) Credit Allowed Against Alternative Minimum Tax.--
            (1) In general.--Subsection (c) of section 25D is amended 
        to read as follows:
    ``(c) Limitation Based on Amount of Tax; Carryforward of Unused 
Credit.--
            ``(1) Limitation based on amount of tax.--In the case of a 
        taxable year to which section 26(a)(2) does not apply, 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) Carryforward of unused credit.--
                    ``(A) Rule for years in which all personal credits 
                allowed against regular and alternative minimum tax.--
                In the case of a taxable year to which section 26(a)(2) 
                applies, if the credit allowable under subsection (a) 
                exceeds the limitation imposed by section 26(a)(2) 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.
                    ``(B) Rule for other years.--In the case of a 
                taxable year to which section 26(a)(2) does not apply, 
                if the credit allowable under subsection (a) exceeds 
                the limitation imposed by paragraph (1) 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.''.
            (2) Conforming amendments.--
                    (A) Section 23(b)(4)(B) is amended by inserting 
                ``and section 25D'' after ``this section''.
                    (B) Section 24(b)(3)(B) is amended by striking 
                ``and 25B'' and inserting ``, 25B, and 25D''.
                    (C) Section 25B(g)(2) is amended by striking 
                ``section 23'' and inserting ``sections 23 and 25D''.
                    (D) Section 26(a)(1) is amended by striking ``and 
                25B'' and inserting ``25B, and 25D''.
    (d) Effective Date.--
            (1) In general.--The amendments made by this section shall 
        apply to taxable years beginning after December 31, 2007.
            (2) Application of egtrra sunset.--The amendments made by 
        subparagraphs (A) and (B) of subsection (c)(2) shall be subject 
        to title IX of the Economic Growth and Tax Relief 
        Reconciliation Act of 2001 in the same manner as the provisions 
        of such Act to which such amendments relate.

SEC. 704. EXTENSION AND MODIFICATION OF CREDIT FOR CLEAN RENEWABLE 
              ENERGY BONDS.

    (a) Extension.--Section 54(m) (relating to termination) is amended 
by striking ``December 31, 2008'' and inserting ``December 31, 2009''.
    (b) Increase in National Limitation.--Section 54(f) (relating to 
limitation on amount of bonds designated) is amended--
            (1) by inserting ``, and for the period beginning after the 
        date of the enactment of the Clean Energy Tax Stimulus Act of 
        2008 and ending before January 1, 2010, $400,000,000'' after 
        ``$1,200,000,000'' in paragraph (1),
            (2) by striking ``$750,000,000 of the'' in paragraph (2) 
        and inserting ``$750,000,000 of the $1,200,000,000'', and
            (3) by striking ``bodies'' in paragraph (2) and inserting 
        ``bodies, and except that the Secretary may not allocate more 
        than \1/3\ of the $400,000,000 national clean renewable energy 
        bond limitation to finance qualified projects of qualified 
        borrowers which are public power providers nor more than \1/3\ 
        of such limitation to finance qualified projects of qualified 
        borrowers which are mutual or cooperative electric companies 
        described in section 501(c)(12) or section 1381(a)(2)(C)''.
    (c) Public Power Providers Defined.--Section 54(j) is amended--
            (1) by adding at the end the following new paragraph:
            ``(6) Public power provider.--The term `public power 
        provider' means a State utility with a service obligation, as 
        such terms are defined in section 217 of the Federal Power Act 
        (as in effect on the date of the enactment of this 
        paragraph).'', and
            (2) by inserting ``; Public Power Provider'' before the 
        period at the end of the heading.
    (d) Technical Amendment.--The third sentence of section 54(e)(2) is 
amended by striking ``subsection (l)(6)'' and inserting ``subsection 
(l)(5)''.
    (e) Effective Date.--The amendments made by this section shall 
apply to bonds issued after the date of the enactment of this Act.

SEC. 705. EXTENSION OF SPECIAL RULE TO IMPLEMENT FERC RESTRUCTURING 
              POLICY.

    (a) Qualifying Electric Transmission Transaction.--
            (1) In general.--Section 451(i)(3) (defining qualifying 
        electric transmission transaction) is amended by striking 
        ``January 1, 2008'' and inserting ``January 1, 2010''.
            (2) Effective date.--The amendment made by this subsection 
        shall apply to transactions after December 31, 2007.
    (b) Independent Transmission Company.--
            (1) In general.--Section 451(i)(4)(B)(ii) (defining 
        independent transmission company) is amended by striking 
        ``December 31, 2007'' and inserting ``the date which is 2 years 
        after the date of such transaction''.
            (2) Effective date.--The amendment made by this subsection 
        shall take effect as if included in the amendments made by 
        section 909 of the American Jobs Creation Act of 2004.

SEC. 706. EXTENSION OF WIND PRODUCTION TAX CREDIT.

    (a) In General.--Paragraph (1) of section 45(d), as amended by this 
Act, is amended by striking ``2010'' and inserting ``2019''.
    (b) Effective Date.--The amendments made by this section shall 
apply to property originally placed in service on or after January 1, 
2009.

    Subtitle B--Extension of Incentives To Improve Energy Efficiency

SEC. 711. EXTENSION AND MODIFICATION OF CREDIT FOR ENERGY EFFICIENCY 
              IMPROVEMENTS TO EXISTING HOMES.

    (a) Extension of Credit.--Section 25C(g) (relating to termination) 
is amended by striking ``December 31, 2007'' and inserting ``December 
31, 2009''.
    (b) Qualified Biomass Fuel Property.--
            (1) In general.--Section 25C(d)(3) is amended--
                    (A) by striking ``and'' at the end of subparagraph 
                (D),
                    (B) by striking the period at the end of 
                subparagraph (E) and inserting ``, and'', and
                    (C) by adding at the end the following new 
                subparagraph:
                    ``(F) a stove which uses the burning of biomass 
                fuel to heat a dwelling unit located in the United 
                States and used as a residence by the taxpayer, or to 
                heat water for use in such a dwelling unit, and which 
                has a thermal efficiency rating of at least 75 
                percent.''.
            (2) Biomass fuel.--Section 25C(d) (relating to residential 
        energy property expenditures) is amended by adding at the end 
        the following new paragraph:
            ``(6) Biomass fuel.--The term `biomass fuel' means any 
        plant-derived fuel available on a renewable or recurring basis, 
        including agricultural crops and trees, wood and wood waste and 
        residues (including wood pellets), plants (including aquatic 
        plants), grasses, residues, and fibers.''.
    (c) Modifications of Standards for Energy-Efficient Building 
Property.--
            (1) Electric heat pumps.--Subparagraph (B) of section 
        25C(d)(3) is amended to read as follows:
                    ``(A) an electric heat pump which achieves the 
                highest efficiency tier established by the Consortium 
                for Energy Efficiency, as in effect on January 1, 
                2008.''.
            (2) Central air conditioners.--Section 25C(d)(3)(D) is 
        amended by striking ``2006'' and inserting ``2008''.
            (3) Water heaters.--Subparagraph (E) of section 25C(d) is 
        amended to read as follows:
                    ``(E) a natural gas, propane, or oil water heater 
                which has either an energy factor of at least 0.80 or a 
                thermal efficiency of at least 90 percent.''.
            (4) Oil furnaces and hot water boilers.--Paragraph (4) of 
        section 25C(d) is amended to read as follows:
            ``(4) Qualified natural gas, propane, and oil furnaces and 
        hot water boilers.--
                    ``(A) Qualified natural gas furnace.--The term 
                `qualified natural gas furnace' means any natural gas 
                furnace which achieves an annual fuel utilization 
                efficiency rate of not less than 95.
                    ``(B) Qualified natural gas hot water boiler.--The 
                term `qualified natural gas hot water boiler' means any 
                natural gas hot water boiler which achieves an annual 
                fuel utilization efficiency rate of not less than 90.
                    ``(C) Qualified propane furnace.--The term 
                `qualified propane furnace' means any propane furnace 
                which achieves an annual fuel utilization efficiency 
                rate of not less than 95.
                    ``(D) Qualified propane hot water boiler.--The term 
                `qualified propane hot water boiler' means any propane 
                hot water boiler which achieves an annual fuel 
                utilization efficiency rate of not less than 90.
                    ``(E) Qualified oil furnaces.--The term `qualified 
                oil furnace' means any oil furnace which achieves an 
                annual fuel utilization efficiency rate of not less 
                than 90.
                    ``(F) Qualified oil hot water boiler.--The term 
                `qualified oil hot water boiler' means any oil hot 
                water boiler which achieves an annual fuel utilization 
                efficiency rate of not less than 90.''.
    (d) Effective Date.--The amendments made this section shall apply 
to expenditures made after December 31, 2007.

SEC. 712. EXTENSION AND MODIFICATION OF TAX CREDIT FOR ENERGY EFFICIENT 
              NEW HOMES.

    (a) Extension of Credit.--Subsection (g) of section 45L (relating 
to termination) is amended by striking ``December 31, 2008'' and 
inserting ``December 31, 2010''.
    (b) Allowance for Contractor's Personal Residence.--Subparagraph 
(B) of section 45L(a)(1) is amended to read as follows:
                    ``(B)(i) acquired by a person from such eligible 
                contractor and used by any person as a residence during 
                the taxable year, or
                    ``(ii) used by such eligible contractor as a 
                residence during the taxable year.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to homes acquired after December 31, 2008.

SEC. 713. EXTENSION AND MODIFICATION OF ENERGY EFFICIENT COMMERCIAL 
              BUILDINGS DEDUCTION.

    (a) Extension.--Section 179D(h) (relating to termination) is 
amended by striking ``December 31, 2008'' and inserting ``December 31, 
2009''.
    (b) Adjustment of Maximum Deduction Amount.--
            (1) In general.--Subparagraph (A) of section 179D(b)(1) 
        (relating to maximum amount of deduction) is amended by 
        striking ``$1.80'' and inserting ``$2.25''.
            (2) Partial allowance.--Paragraph (1) of section 179D(d) is 
        amended--
                    (A) by striking ``$.60'' and inserting ``$0.75'', 
                and
                    (B) by striking ``$1.80'' and inserting ``$2.25''.
    (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.

SEC. 714. MODIFICATION AND EXTENSION OF ENERGY EFFICIENT APPLIANCE 
              CREDIT FOR APPLIANCES PRODUCED AFTER 2007.

    (a) In General.--Subsection (b) of section 45M (relating to 
applicable amount) is amended to read as follows:
    ``(b) Applicable Amount.--For purposes of subsection (a)--
            ``(1) Dishwashers.--The applicable amount is--
                    ``(A) $45 in the case of a dishwasher which is 
                manufactured in calendar year 2008 or 2009 and which 
                uses no more than 324 kilowatt hours per year and 5.8 
                gallons per cycle, and
                    ``(B) $75 in the case of a dishwasher which is 
                manufactured in calendar year 2008, 2009, or 2010 and 
                which uses no more than 307 kilowatt hours per year and 
                5.0 gallons per cycle (5.5 gallons per cycle for 
                dishwashers designed for greater than 12 place 
                settings).
            ``(2) Clothes washers.--The applicable amount is--
                    ``(A) $75 in the case of a residential top-loading 
                clothes washer manufactured in calendar year 2008 which 
                meets or exceeds a 1.72 modified energy factor and does 
                not exceed a 8.0 water consumption factor,
                    ``(B) $125 in the case of a residential top-loading 
                clothes washer manufactured in calendar year 2008 or 
                2009 which meets or exceeds a 1.8 modified energy 
                factor and does not exceed a 7.5 water consumption 
                factor,
                    ``(C) $150 in the case of a residential or 
                commercial clothes washer manufactured in calendar year 
                2008, 2009, or 2010 which meets or exceeds 2.0 modified 
                energy factor and does not exceed a 6.0 water 
                consumption factor, and
                    ``(D) $250 in the case of a residential or 
                commercial clothes washer manufactured in calendar year 
                2008, 2009, or 2010 which meets or exceeds 2.2 modified 
                energy factor and does not exceed a 4.5 water 
                consumption factor.
            ``(3) Refrigerators.--The applicable amount is--
                    ``(A) $50 in the case of a refrigerator which is 
                manufactured in calendar year 2008, and consumes at 
                least 20 percent but not more than 22.9 percent less 
                kilowatt hours per year than the 2001 energy 
                conservation standards,
                    ``(B) $75 in the case of a refrigerator which is 
                manufactured in calendar year 2008 or 2009, and 
                consumes at least 23 percent but no more than 24.9 
                percent less kilowatt hours per year than the 2001 
                energy conservation standards,
                    ``(C) $100 in the case of a refrigerator which is 
                manufactured in calendar year 2008, 2009, or 2010, and 
                consumes at least 25 percent but not more than 29.9 
                percent less kilowatt hours per year than the 2001 
                energy conservation standards, and
                    ``(D) $200 in the case of a refrigerator 
                manufactured in calendar year 2008, 2009, or 2010 and 
                which consumes at least 30 percent less energy than the 
                2001 energy conservation standards.''.
    (b) Eligible Production.--
            (1) Similar treatment for all appliances.--Subsection (c) 
        of section 45M (relating to eligible production) is amended--
                    (A) by striking paragraph (2),
                    (B) by striking ``(1) In general'' and all that 
                follows through ``the eligible'' and inserting ``The 
                eligible'', and
                    (C) by moving the text of such subsection in line 
                with the subsection heading and redesignating 
                subparagraphs (A) and (B) as paragraphs (1) and (2), 
                respectively.
            (2) Modification of base period.--Paragraph (2) of section 
        45M(c), as amended by paragraph (1) of this section, is amended 
        by striking ``3-calendar year'' and inserting ``2-calendar 
        year''.
    (c) Types of Energy Efficient Appliances.--Subsection (d) of 
section 45M (defining types of energy efficient appliances) is amended 
to read as follows:
    ``(d) Types of Energy Efficient Appliance.--For purposes of this 
section, the types of energy efficient appliances are--
            ``(1) dishwashers described in subsection (b)(1),
            ``(2) clothes washers described in subsection (b)(2), and
            ``(3) refrigerators described in subsection (b)(3).''.
    (d) Aggregate Credit Amount Allowed.--
            (1) Increase in limit.--Paragraph (1) of section 45M(e) 
        (relating to aggregate credit amount allowed) is amended to 
        read as follows:
            ``(1) Aggregate credit amount allowed.--The aggregate 
        amount of credit allowed under subsection (a) with respect to a 
        taxpayer for any taxable year shall not exceed $75,000,000 
        reduced by the amount of the credit allowed under subsection 
        (a) to the taxpayer (or any predecessor) for all prior taxable 
        years beginning after December 31, 2007.''.
            (2) Exception for certain refrigerator and clothes 
        washers.--Paragraph (2) of section 45M(e) is amended to read as 
        follows:
            ``(2) Amount allowed for certain refrigerators and clothes 
        washers.--Refrigerators described in subsection (b)(3)(D) and 
        clothes washers described in subsection (b)(2)(D) shall not be 
        taken into account under paragraph (1).''.
    (e) Qualified Energy Efficient Appliances.--
            (1) In general.--Paragraph (1) of section 45M(f) (defining 
        qualified energy efficient appliance) is amended to read as 
        follows:
            ``(1) Qualified energy efficient appliance.--The term 
        `qualified energy efficient appliance' means--
                    ``(A) any dishwasher described in subsection 
                (b)(1),
                    ``(B) any clothes washer described in subsection 
                (b)(2), and
                    ``(C) any refrigerator described in subsection 
                (b)(3).''.
            (2) Clothes washer.--Section 45M(f)(3) (defining clothes 
        washer) is amended by inserting ``commercial'' before 
        ``residential'' the second place it appears.
            (3) Top-loading clothes washer.--Subsection (f) of section 
        45M (relating to definitions) is amended by redesignating 
        paragraphs (4), (5), (6), and (7) as paragraphs (5), (6), (7), 
        and (8), respectively, and by inserting after paragraph (3) the 
        following new paragraph:
            ``(4) Top-loading clothes washer.--The term `top-loading 
        clothes washer' means a clothes washer which has the clothes 
        container compartment access located on the top of the machine 
        and which operates on a vertical axis.''.
            (4) Replacement of energy factor.--Section 45M(f)(6), as 
        redesignated by paragraph (3), is amended to read as follows:
            ``(6) Modified energy factor.--The term `modified energy 
        factor' means the modified energy factor established by the 
        Department of Energy for compliance with the Federal energy 
        conservation standard.''.
            (5) Gallons per cycle; water consumption factor.--Section 
        45M(f) (relating to definitions), as amended by paragraph (3), 
        is amended by adding at the end the following:
            ``(9) Gallons per cycle.--The term `gallons per cycle' 
        means, with respect to a dishwasher, the amount of water, 
        expressed in gallons, required to complete a normal cycle of a 
        dishwasher.
            ``(10) Water consumption factor.--The term `water 
        consumption factor' means, with respect to a clothes washer, 
        the quotient of the total weighted per-cycle water consumption 
        divided by the cubic foot (or liter) capacity of the clothes 
        washer.''.
    (f) Effective Date.--The amendments made by this section shall 
apply to appliances produced after December 31, 2007.

  TITLE VIII--INCENTIVIZING THE EXTRACTION AND PROCESSING OF OIL SHALE

SEC. 801. INCENTIVES FOR EXTRACTION AND PROCESSING OF OIL SHALE.

    (a) Investment Tax Credit for Extraction and Processing of Oil 
Shale Using In-Situ Conversion Technology.--
            (1) In general.--Subpart E of part IV of subchapter A of 
        chapter 1 of the Internal Revenue Code of 1986, as amended by 
        this Act, is amended by inserting after section 48C the 
        following new section:

``SEC. 48D. OIL SHALE EXTRACTION AND PROCESSING FACILITY.

    ``(a) General Rule.--For purposes of section 46, the oil shale 
extraction and processing credit for any taxable year is 30 percent of 
the cost of any qualified oil shale extraction and processing property.
    ``(b) Qualified Oil Shale Extraction and Processing Property.--The 
term `qualified oil shale extraction and processing property' means 
property of a character subject to the allowance for depreciation--
            ``(1) which is used in the United States solely to extract 
        and process oil shale using in-situ conversion technology,
            ``(2) the original use of which commences with the taxpayer 
        after the date of the enactment of this section,
            ``(3) which is acquired by the taxpayer by purchase (as 
        defined in section 179(d)) after the date of the enactment of 
        this subsection, but only if no written binding contract for 
        the acquisition was in effect on or before the date of the 
        enactment of this subsection, and
            ``(4) which is placed in service by the taxpayer before 
        January 1, 2019.
    ``(c) Special Rule for Certain Subsidized Property.--For purposes 
of this section, rules similar to the rules of section 48(a)(4) shall 
apply.
    ``(d) Denial of Double Benefit.--A deduction or credit shall not be 
allowed under any other provision of this chapter for the cost taken 
into account under subsection (a).''.
            (2) Credit treated as part of investment credit.--Section 
        46, as amended by this Act, is amended by striking ``and'' at 
        the end of paragraph (5), by striking the period at the end of 
        paragraph (6) and inserting ``, and'', and by adding at the end 
        the following new paragraph:
            ``(7) the oil shale extraction and processing credit.''.
            (3) Conforming amendments.--
                    (A) Section 49(a)(1)(C), as amended by this Act, is 
                amended by striking ``and'' at the end of clause (v), 
                by striking the period at the end of clause (vi) and 
                inserting ``, and'', and by adding at the end the 
                following new clause:
                            ``(vii) the basis of any qualified oil 
                        shale extraction and processing property.''.
                    (B) The table of sections for subpart E of part IV 
                of subchapter A of chapter 1, as amended by this Act, 
                is amended by inserting after the item relating to 
                section 48C the following new item:

``Sec. 48D. Oil shale extraction and processing facility.''.
    (b) Expensing Oil Shale Extraction and Processing Property.--Part 
VI of subchapter B of chapter 1 of such Code is amended by inserting 
after section 179F the following new section:

``SEC. 179G. ELECTION TO EXPENSE CERTAIN OIL SHALE EXTRACTION AND 
              PROCESSING PROPERTY.

    ``(a) Treatment as Expenses.--A taxpayer may elect to treat the 
cost of any qualified oil shale extraction and processing property as 
an expense which is not chargeable to capital account. Any cost so 
treated shall be allowed as a deduction for the taxable year in which 
the expense is incurred.
    ``(b) Election.--
            ``(1) In general.--An election under this section for any 
        taxable year shall be made on the taxpayer's return of the tax 
        imposed by this chapter for the taxable year. Such election 
        shall be made in such manner as the Secretary may by 
        regulations prescribe.
            ``(2) Election irrevocable.--Any election made under this 
        section may not be revoked except with the consent of the 
        Secretary.
    ``(c) Qualified Oil Shale Extraction and Processing Property.--For 
purposes of this section--
            ``(1) The term `qualified oil shale extraction and 
        processing property' means any property located in the United 
        States--
                    ``(A) the original use of which commences with the 
                taxpayer and which original use is solely to extract or 
                process oil shale, and
                    ``(B) which is placed in service by the taxpayer 
                after the date of the enactment of this section and 
                before January 1, 2019.
    ``(d) Election To Allocate Deduction to Cooperative Owner.--If--
            ``(1) a taxpayer to which subsection (a) applies is an 
        organization to which part I of subchapter T applies, and
            ``(2) one or more persons directly holding an ownership 
        interest in the taxpayer are organizations to which part I of 
        subchapter T apply,
the taxpayer may elect to allocate all or a portion of the deduction 
allowable under subsection (a) to such persons. Such allocation shall 
be equal to the person's ratable share of the total amount allocated, 
determined on the basis of the person's ownership interest in the 
taxpayer. The taxable income of the taxpayer shall not be reduced under 
section 1382 by reason of any amount to which the preceding sentence 
applies.
    ``(e) Basis Reduction.--
            ``(1) In general.--For purposes of this title, if a 
        deduction is allowed under this section with respect to any 
        qualified oil shale extraction and processing property, 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 which is of a character 
        subject to the allowance for depreciation shall be treated as a 
        deduction allowed for depreciation under section 167.
    ``(f) Application With Other Deductions and Credits.--
            ``(1) Other deductions.--No deduction shall be allowed 
        under any other provision of this chapter with respect to any 
        expenditure with respect to which a deduction is allowed under 
        subsection (a) to the taxpayer.
            ``(2) Credits.--No credit shall be allowed under section 38 
        with respect to any amount for which a deduction is allowed 
        under subsection (a).
    ``(g) Reporting.--No deduction shall be allowed under subsection 
(a) to any taxpayer for any taxable year unless such taxpayer files 
with the Secretary a report containing such information with respect to 
the operation of the property of the taxpayer as the Secretary shall 
require.''.
    (c) Conforming Amendments.--
            (1) Section 1016(a) of such Code is amended by striking 
        ``and'' at the end of paragraph (37), by striking the period at 
        the end of paragraph (38) and inserting ``, and'', and by 
        adding at the end the following new paragraph:
            ``(39) to the extent provided in section 179G(e)(1).''.
            (2) Section 1245(a) of such Code is amended by inserting 
        ``179G,'' after ``179F,'' both places it appears in paragraphs 
        (2)(C) and (3)(C).
            (3) Section 263(a)(1) of such Code is amended by striking 
        ``or'' at the end of subparagraph (L), by striking the period 
        at the end of subparagraph (M) and inserting ``, or'', and by 
        inserting after subparagraph (M) the following new 
        subparagraph:
                    ``(N) expenditures for which a deduction is allowed 
                under section 179G.''.
            (4) Section 312(k)(3)(B) of such Code is amended by 
        striking ``or 179F'' each place it appears in the heading and 
        text and inserting ``179F, or 179G''.
            (5) The table of sections for part VI of subchapter B of 
        chapter 1 of such Code is amended by inserting after the item 
        relating to section 179F the following new item:

``Sec. 179G. Election to expense certain oil shale extraction and 
                            processing property.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to properties placed in service after the date of the enactment 
of this Act.

                 TITLE IX--LAND FOR BIOFUEL PRODUCTION

SEC. 901. LEASE OF PUBLIC LANDS FOR PRODUCTION OF RENEWABLE BIOMASS FOR 
              BIOFUELS.

    Title II of the Federal Land Policy and Management Act of 1976 (43 
U.S.C. 1711 et seq.) is amended by adding at the end the following new 
section:

``SEC. 215. LEASE OF PUBLIC LANDS FOR PRODUCTION OF RENEWABLE BIOMASS 
              FOR BIOFUELS.

    ``(a) Authority To Lease Lands.--The Secretary may lease a tract of 
the public lands under this Act where, as a result of land use planning 
required under section 202 of this Act, the Secretary determines that--
            ``(1) the tract is suitable for agricultural production; 
        and
            ``(2) the lessee of the tract will use the tract for the 
        production of renewable biomass to be used in the production of 
        biofuels.
    ``(b) Exclusion of Certain Public Lands.--This section does not 
apply with respect to the following land:
            ``(1) Land in a unit of the National Wilderness 
        Preservation System.
            ``(2) Land included in the National Wild and Scenic Rivers 
        Systems.
            ``(3) Land included in the National System of Trails.
            ``(4) Land designated as a National Monument.
            ``(5) Land regarding which other public objectives and 
        values, including recreation and scenic values, outweigh the 
        benefit of using the land for the production of renewable 
        biomass for biofuels, as determined by the Secretary.
    ``(c) Consideration.--The lease of public lands under this section 
shall be made at a rental rate determined by the Secretary to be 
appropriate to promote the production of renewable biomass for 
biofuels.
    ``(d) Competitive Bidding.--
            ``(1) In general.--The lease of public lands under this 
        section shall be conducted under competitive bidding procedures 
        to be established by the Secretary.
            ``(2) Modification.--The Secretary may lease public lands 
        under this section with modified competitive bidding or without 
        competitive bidding--
                    ``(A) to assure an equitable distribution of land 
                among potential renters; or
                    ``(B) to encourage farmers who are using other 
                lands to produce feed grains for biofuels production to 
                return the other lands to crop production for food or 
                feed use.
    ``(e) Definitions.--In this section:
            ``(1) Biofuel.--The term `biofuel' means a fuel derived 
        from renewable biomass.
            ``(2) Renewable biomass.--The term `renewable biomass' 
        means--
                    ``(A) renewable plant material, including feed 
                grains and other agricultural commodities (other than 
                trees); and
                    ``(B) crop residue and other vegetative waste 
                material (other than wood waste and wood residues).''.
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