[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 670 Introduced in House (IH)]







110th CONGRESS
  1st Session
                                H. R. 670

  To promote the national security and stability of the United States 
economy by reducing the dependence of the United States on foreign oil 
through the use of alternative fuels and new vehicle technologies, and 
                          for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 24, 2007

   Mr. Engel (for himself, Mr. Kingston, Mr. Inslee, Mr. Saxton, Ms. 
   Eshoo, Mrs. Bono, Mr. Wynn, Mr. Terry, Ms. Harman, Mr. Rogers of 
    Alabama, Ms. Schakowsky, Mr. Bartlett of Maryland, Mr. Udall of 
   Colorado, Mr. Inglis of South Carolina, Mr. Ross, Mr. Campbell of 
   California, Mr. Weiner, Mr. Gilchrest, Mr. Towns, Mr. Souder, Mr. 
 DeFazio, Mr. Gerlach, Mr. Bishop of New York, Mr. Renzi, Mr. Israel, 
   Mr. Everett, Mr. Hall of New York, Mr. LoBiondo, Ms. Matsui, Mr. 
 McCotter, Mrs. Lowey, Mr. Linder, Mr. Kuhl of New York, Mr. Hinchey, 
 Mr. Westmoreland, Mr. Berman, Mr. Gingrey, Mr. Ackerman, Mr. Andrews, 
Mr. Arcuri, Ms. Berkley, Mr. Bishop of Georgia, Mr. Cohen, Mr. Cleaver, 
   Ms. Giffords, Mrs. Gillibrand, Mr. Honda, Mr. Kind, Mr. Klein of 
  Florida, Mr. Lipinski, Mr. McNulty, Ms. McCollum of Minnesota, Mr. 
 Moore of Kansas, Mr. Moran of Virginia, Mrs. Napolitano, Mr. Price of 
   North Carolina, Ms. Schwartz, Mr. Rothman, Mr. Ruppersberger, Mr. 
 Schiff, Mr. Burton of Indiana, Mr. Scott of Georgia, Mr. Platts, Mr. 
    Sherman, Mr. Wexler, Mr. Price of Georgia, Mr. Lincoln Davis of 
  Tennessee, and Mr. Lantos) introduced the following bill; which was 
 referred to the Committee on Energy and Commerce, and in addition to 
       the Committees on Science and Technology, Ways and Means, 
Transportation and Infrastructure, and Oversight and Government Reform, 
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 promote the national security and stability of the United States 
economy by reducing the dependence of the United States on foreign oil 
through the use of alternative fuels and new vehicle technologies, and 
                          for other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Dependence 
Reduction through Innovation in Vehicles and Energy Act'' or the 
``DRIVE Act''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Findings and purposes.
           TITLE I--OIL SAVINGS ACTION PLAN AND REQUIREMENTS

Sec. 101. Oil savings target and action plan.
Sec. 102. Standards and requirements.
Sec. 103. Evaluation.
Sec. 104. Review and update of action plan.
Sec. 105. Baseline and analysis requirements.
Sec. 106. Review and scoring of Federal actions related to oil savings 
                            action plan.
Sec. 107. Federal Government oil usage audit.
Sec. 108. Nationwide media campaign to decrease oil consumption.
         TITLE II--FUEL EFFICIENT VEHICLES FOR THE 21ST CENTURY

Sec. 201. Tire efficiency program.
Sec. 202. Reduction of school bus idling.
Sec. 203. Fuel efficiency for heavy duty trucks.
Sec. 204. Lightweight materials research and development.
Sec. 205. Hybrid and advanced diesel vehicles.
Sec. 206. Advanced technology motor vehicles manufacturing credit.
Sec. 207. Consumer incentives to purchase advanced technology vehicles.
Sec. 208. Federal fleet requirements.
Sec. 209. Tax incentives for private fleets.
Sec. 210. Reducing incentives to guzzle gas.
Sec. 211. Fuel Choice for Transportation.
Sec. 212. Flexible fuel vehicle economy calculations.
              TITLE III--FUEL CHOICES FOR THE 21ST CENTURY

Sec. 301. Fuel Choice action plan.
Sec. 302. Ethanol action plan.
Sec. 303. Fuel neutrality for alternative fuel vehicle refueling 
                            property credit.
Sec. 304. Alternative fuel vehicle refueling property.
Sec. 305. Use of CAFE penalties to build alternative fueling 
                            infrastructure.
Sec. 306. Cellulosic biomass fuel.
Sec. 307. Production incentives for cellulosic biofuels.
Sec. 308. Transit-Oriented Development Corridors.
Sec. 309. Saving oil by reducing miles-of-travel: Pilot projects.
Sec. 310. Saving oil by reducing vehicle-miles-of-travel: Research and 
                            development.
Sec. 311. Biofuels.
                TITLE IV--ELECTRICITY FOR TRANSPORTATION

Sec. 401. Near-term vehicle technology program.
Sec. 402. Amendments to Alternative Motor Vehicle Credit.
Sec. 403. Idling Reduction Tax Credit.
Sec. 404. Plug-in Hybrid Electric Vehicle Prize.

SEC. 2. FINDINGS AND PURPOSES.

    (a) Findings.--Congress finds that--
            (1) the United States is dangerously dependent on oil;
            (2) that dependence threatens the national security, 
        weakens the economy, and harms the environment of the United 
        States;
            (3) the United States currently imports nearly 60 percent 
        of oil needed in the United States, and that percentage is 
        expected to grow to almost 70 percent by 2025 if no actions are 
        taken;
            (4) approximately 2,500,000 barrels of oil per day are 
        imported from countries in the Persian Gulf region;
            (5) that dependence on foreign oil undermines the war on 
        terror by financing both sides of the war;
            (6) in 2004 alone, the United States sent $103,000,000,000 
        to undemocratic countries, some of which use revenues to 
        support terrorism and spread ideology hostile to the United 
        States, as documented by the Council on Foreign Relations;
            (7) terrorists have identified oil as a strategic 
        vulnerability and have increased attacks against oil 
        infrastructure worldwide;
            (8) the International Energy Agency in its World Outlook 
        2006 report projected that ``non-OPEC conventional crude oil 
        output peaks by the middle of the next decade...trends would 
        accentuate consuming countries' vulnerability to a severe 
        supply disruption and resulting price shock'' and recommended 
        that ``strong policy action is needed to move the world onto a 
        more sustainable energy path'';
            (9) oil imports comprise nearly 30 percent of the 
        dangerously high United States trade deficit;
            (10) it is technically feasible to achieve oil savings of 
        more than 2,500,000 barrels per day by 2015 and 5,000,000 
        barrels per day by 2025;
            (11) those goals can be achieved by establishing a set of 
        flexible policies, including--
                    (A) increasing the gasoline-efficiency of cars, 
                trucks, tires, and oil;
                    (B) providing economic incentives for companies and 
                consumers to produce and purchase 21st Century fuel 
                efficient and flexible fuel vehicles;
                    (C) encouraging the use of transit and the 
                reduction of truck and bus idling;
                    (D) increasing production and commercialization of 
                alternative liquid fuels;
                    (E) increasing the efficiency of current oil based 
                fuels with combustion enhancers and other advanced 
                technology; and
                    (F) increasing the use of electricity as a 
                transportation fuel;
            (12) vehicle technology available as of the date of 
        enactment of this Act (including popular hybrid-electric 
        vehicle models, the sales of which in the United States 
        increased 173 percent in the first 5 months of 2005 as compared 
        with the same period in 2004) make an oil savings plan 
        eminently achievable;
            (13) alternative and renewable liquid transportation fuels 
        are already available (including corn and sugar based ethanol, 
        biodiesel, methanol, and diesel fuels derived from coal) to 
        make such an oil savings and fuel choice plan eminently 
        achievable;
            (14) achieving those goals will benefit consumers and 
        businesses through lower fuel bills and reduction in world oil 
        prices;
            (15) achieving those goals will help protect the economy of 
        the United States from high and volatile oil prices and from 
        the threats caused by global instability, terrorism, and 
        natural disaster; and
            (16) it is urgent, essential, and feasible to implement an 
        action plan to achieve oil savings as soon as practicable 
        because any delay in initiating action will--
                    (A) make achieving necessary oil savings more 
                difficult and expensive;
                    (B) increase the risks to the national security, 
                economy, and environment of the United States; and
                    (C) leave the American people and economy 
                vulnerable to the threats posed by terrorism, natural 
                disaster, political instability, and the shrinking 
                ability of global oil supplies to meet rapidly 
                expanding oil demands.
    (b) Purposes.--The purposes of this Act are--
            (1) to accelerate market penetration of flexible fuel, 
        electric drive, and alternative motor vehicles;
            (2) to enable the accelerated market penetration of 
        efficient technologies and alternative fuels without adverse 
        impact on air quality while maintaining a policy of fuel 
        neutrality, so as to allow market forces to elect the 
        technologies and fuels that are consumer-friendly, safe, 
        environmentally-sound, and economic;
            (3) to provide time-limited financial incentives to 
        encourage production and consumer purchase of oil saving 
        technologies and fuels nationwide;
            (4) to promote a nationwide diversity of motor vehicle 
        fuels and advanced motor vehicle technology, including advanced 
        lean burn technology, hybrid technology, flexible fuel motor 
        vehicles, alternatively fueled motor vehicles, and other oil 
        saving technologies; and
            (5) to decrease American dependence on imported oil.

           TITLE I--OIL SAVINGS ACTION PLAN AND REQUIREMENTS

SEC. 101. OIL SAVINGS TARGET AND ACTION PLAN.

    Not later than 270 days after the date of enactment of this Act, 
the Director of the Office of Management and Budget (referred to in 
this title as the ``Director'') shall publish in the Federal Register 
an action plan consisting of--
            (1) a list of requirements proposed or to be proposed 
        pursuant to section 102 that are authorized to be issued under 
        law in effect on the date of enactment of this Act, and this 
        Act, that will be sufficient, when taken together, to save from 
        the baseline determined under section 105--
                    (A) 2,500,000 barrels of oil per day on average 
                during calendar year 2015; and
                    (B) 5,000,000 barrels of oil per day on average 
                during calendar year 2025; and
            (2) a Federal Government-wide analysis demonstrating--
                    (A) the expected oil savings from the baseline to 
                be accomplished by each requirement; and
                    (B) that all such requirements, taken together, 
                will achieve the oil savings specified in this section.

SEC. 102. STANDARDS AND REQUIREMENTS.

    (a) In General.--On or before the date by which publication of the 
action plan is required under section 101, the Secretary of Energy, the 
Secretary of Transportation, the Secretary of Defense, the Secretary of 
Agriculture, the Administrator of the Environmental Protection Agency, 
and the head of any other agency authorized to take an action listed in 
the action plan shall each propose, or issue a notice of intent to 
propose, regulations establishing each standard or other requirement 
listed in the action plan that is under the jurisdiction of the 
respective agency using authorities described in subsection (b). If a 
notice of intent to propose is issued, the head of the responsible 
agency shall propose such regulations not later than 330 days after the 
date of enactment of this Act.
    (b) Authorities.--The head of each agency described in subsection 
(a) shall use to carry out this section--
            (1) any authority in existence on the date of enactment of 
        this Act (including regulations); and
            (2) any new authority provided under this Act (including an 
        amendment made by this Act).
    (c) Final Regulations.--Not later than 18 months after the date of 
enactment of this Act, the head of each agency described in subsection 
(a) shall promulgate final versions of the regulations required under 
this section.
    (d) Content of Regulations.--Each proposed and final regulation 
promulgated under this section shall--
            (1) be sufficient to achieve at least the oil savings 
        resulting from the regulation under the action plan published 
        under section 101; and
            (2) be accompanied by an analysis by the applicable agency 
        demonstrating that the regulation will achieve such oil 
        savings, as measured from the baseline determined under section 
        105.

SEC. 103. EVALUATION.

    (a) In General.--Not later than 2 years after the date of enactment 
of this Act, and after an opportunity for public comment, the Director 
shall publish in the Federal Register a Federal Government-wide 
analysis of the oil savings achieved and the expected oil savings under 
the standards and requirements established under this Act and the 
amendments made by this Act from the baseline established under section 
105, and a determination whether such oil savings will meet the targets 
established under section 101.
    (b) Inadequate Oil Savings.--If the oil savings are less than the 
targets established under section 101, simultaneously with the analysis 
required under subsection (a)--
            (1) the Director shall publish a revised action plan that 
        is sufficient to achieve the targets; and
            (2) the head of each agency referred to in section 102(a) 
        shall propose new or revised regulations sufficient to achieve 
        such targets under section 102(a).
    (c) Final Regulations.--Not later than 180 days after the date on 
which regulations are proposed under subsection (b)(2), the head of 
each agency shall promulgate final versions of those regulations that 
comply with section 102(d).

SEC. 104. REVIEW AND UPDATE OF ACTION PLAN.

    (a) Review.--Not later than January 1, 2011, and every 3 years 
thereafter, the Director shall publish a report that--
            (1) evaluates the progress achieved in implementing the oil 
        savings targets established under section 101;
            (2) analyzes the expected oil savings under the standards 
        and requirements established under this Act and the amendments 
        made by this Act; and
            (3)(A) analyzes the potential to achieve oil savings that 
        are in addition to the savings required by section 101; and
            (B) if the President determines that it is in the national 
        interest, establishes a higher oil savings target for calendar 
        year 2017 or any subsequent calendar year.
    (b) Inadequate Oil Savings.--If the oil savings are less than the 
targets established under section 101, simultaneously with the report 
required under subsection (a)--
            (1) the Director shall publish a revised action plan that 
        is sufficient to achieve the targets; and
            (2) the head of each agency referred to in section 102(a) 
        shall propose new or revised regulations sufficient to achieve 
        such targets under section 102(a).
    (c) Final Regulations.--Not later than 180 days after the date on 
which regulations are proposed under subsection (b)(2), the head of 
each agency referred to in section 102(a) shall promulgate final 
versions of those regulations that comply with section 102(d).

SEC. 105. BASELINE AND ANALYSIS REQUIREMENTS.

    In performing the analyses and promulgating proposed or final 
regulations to establish standards and other requirements necessary to 
achieve the oil savings required by this title, the Director, the 
Secretary of Energy, the Secretary of Transportation, the Secretary of 
Defense, the Secretary of Agriculture, the Administrator of the 
Environmental Protection Agency, and the head of any other agency 
authorized to take an action listed in the action plan shall--
            (1) determine oil savings as the projected reduction in oil 
        consumption from the baseline established by the reference case 
        contained in the report of the Energy Information 
        Administration entitled ``Annual Energy Outlook 2006'';
            (2) determine the oil savings projections required on an 
        annual basis for each of calendar years 2009 through 2026; and
            (3) account for any overlap among the standards and other 
        requirements to ensure that the projected oil savings from all 
        the promulgated standards and requirements, taken together, are 
        as accurate as practicable.

SEC. 106. REVIEW AND SCORING OF FEDERAL ACTIONS RELATED TO OIL SAVINGS 
              ACTION PLAN.

    (a) Office of Management and Budget.--
            (1) Requirement.--The Director shall--
                    (A) establish procedures to evaluate all proposals 
                for Federal legislative or executive actions which 
                could be reasonably considered to impact the supply or 
                demand of oil in the United States; and
                    (B) report to the Congress on the net impact the 
                reviewed proposal would have on reaching the goals of 
                the action plan required under section 101, including a 
                score in terms of projected decreases or increases to 
                oil usage.
            (2) Conclusions.--The conclusions of the Director under 
        paragraph (1) shall also be published in the public record and 
        considered as part of any rulemaking procedure or impact 
        statement.
    (b) Comptroller General.--
            (1) Requirement.--The Comptroller General shall--
                    (A) establish procedures to evaluate all proposals 
                for Federal legislative or executive actions which 
                could be reasonably considered to impact the supply or 
                demand of oil in the United States; and
                    (B) report to the Congress on the net impact the 
                reviewed proposal would have on reaching the goals of 
                the action plan required under section 101, including a 
                score in terms of projected decreases or increases to 
                oil usage.
            (2) Conclusions.--The conclusions of the Comptroller 
        General under paragraph (1) shall also be published in the 
        public record and considered as part of any rulemaking 
        procedure or impact statement.

SEC. 107. FEDERAL GOVERNMENT OIL USAGE AUDIT.

    Not later than 2 years after the date of enactment of this Act, 
each Federal agency shall complete an audit of oil-derived fuel usage 
in the agency. The head of the agency shall establish an oil usage 
baseline and develop a plan to reduce oil consumption by 10 percent 
over 5 years and 20 percent in 10 years. The Secretary of Energy shall 
compile an annual report containing all agency reports and 
recommendations under this section and deliver it to the Congress not 
later than January 31 of each year.

SEC. 108. NATIONWIDE MEDIA CAMPAIGN TO DECREASE OIL CONSUMPTION.

    (a) In General.--The Secretary of Energy, acting through the 
Assistant Secretary for Energy Efficiency and Renewable Energy 
(referred to in this section as the ``Secretary''), shall develop and 
conduct a national media campaign for the purpose of decreasing oil 
consumption in the United States over the next decade.
    (b) Contract With Entity.--The Secretary shall carry out subsection 
(a) directly or through--
            (1) competitively bid contracts with 1 or more nationally 
        recognized media firms for the development and distribution of 
        monthly television, radio, and newspaper public service 
        announcements; or
            (2) collective agreements with 1 or more nationally 
        recognized institutes, businesses, or nonprofit organizations 
        for the funding, development, and distribution of monthly 
        television, radio, and newspaper public service announcements.
    (c) Use of Funds.--
            (1) In general.--Amounts made available to carry out this 
        section shall be used for the following:
                    (A) Advertising costs.--
                            (i) The purchase of media time and space.
                            (ii) Creative and talent costs.
                            (iii) Testing and evaluation of 
                        advertising.
                            (iv) Evaluation of the effectiveness of the 
                        media campaign.
                            (v) The negotiated fees for the winning 
                        bidder on requests from proposals issued either 
                        by the Secretary for purposes otherwise 
                        authorized in this section.
                            (vi) Entertainment industry outreach, 
                        interactive outreach, media projects and 
                        activities, public information, news media 
                        outreach, and corporate sponsorship and 
                        participation.
                    (B) Administrative costs.--Operational and 
                management expenses.
            (2) Limitations.--In carrying out this section, the 
        Secretary shall allocate not less than 85 percent of funds made 
        available under subsection (e) for each fiscal year for the 
        advertising functions specified under paragraph (1)(A).
    (d) Reports.--The Secretary shall annually submit to Congress a 
report that describes--
            (1) the strategy of the national media campaign and whether 
        specific objectives of the campaign were accomplished, 
        including--
                    (A) determinations concerning the rate of change of 
                oil consumption, in both absolute and per capita terms; 
                and
                    (B) an evaluation that enables consideration 
                whether the media campaign contributed to reduction of 
                oil consumption;
            (2) steps taken to ensure that the national media campaign 
        operates in an effective and efficient manner consistent with 
        the overall strategy and focus of the campaign;
            (3) plans to purchase advertising time and space;
            (4) policies and practices implemented to ensure that 
        Federal funds are used responsibly to purchase advertising time 
        and space and eliminate the potential for waste, fraud, and 
        abuse; and
            (5) all contracts or cooperative agreements entered into 
        with a corporation, partnership, or individual working on 
        behalf of the national media campaign.
    (e) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $50,000,000 for each of fiscal 
years 2008 through 2012.

         TITLE II--FUEL EFFICIENT VEHICLES FOR THE 21ST CENTURY

SEC. 201. TIRE EFFICIENCY PROGRAM.

    (a) Standards for Tires Manufactured for Interstate Commerce.--
Section 30123 of title 49, United States Code, is amended--
            (1) in subsection (b)--
                    (A) in the first sentence, by striking ``The 
                Secretary'' and inserting the following:
            ``(1) Uniform quality grading system.--
                    ``(A) In general.--The Secretary'';
                    (B) in the second sentence, by striking ``The 
                Secretary'' and inserting the following:
            ``(2) Nomenclature and marketing practices.--The 
        Secretary'';
                    (C) in the third sentence, by striking ``A tire 
                standard'' and inserting the following:
            ``(3) Effect of standards and regulations.--A tire 
        standard''; and
                    (D) in paragraph (1), as designated by subparagraph 
                (A), by adding at the end the following:
                    ``(B) Inclusion.--The grading system established 
                pursuant to subparagraph (A) shall include standards 
                for rating the fuel efficiency of tires designed for 
                use on passenger cars and light trucks.''; and
            (2) by adding at the end the following:
    ``(d) National Tire Efficiency Program.--
            ``(1) Definition.--In this subsection, the term `fuel 
        economy', with respect to a tire, means the extent to which the 
        tire contributes to the fuel economy of the motor vehicle on 
        which the tire is mounted.
            ``(2) Program.--The Secretary shall develop and carry out a 
        national tire fuel efficiency program for tires designed for 
        use on passenger cars and light trucks.
            ``(3) Requirements.--Not later than March 31, 2008, the 
        Secretary shall issue regulations, which establish--
                    ``(A) policies and procedures for testing and 
                labeling tires for fuel economy to enable tire buyers 
                to make informed purchasing decisions about the fuel 
                economy of tires;
                    ``(B) policies and procedures to promote the 
                purchase of energy efficient replacement tires, 
                including purchase incentives, website listings on the 
                Internet, printed fuel economy guide booklets, and 
                mandatory requirements for tire retailers to provide 
                tire buyers with fuel efficiency information on tires; 
                and
                    ``(C) minimum fuel economy standards for tires.
            ``(4) Minimum fuel economy standards.--In promulgating 
        minimum fuel economy standards for tires, the Secretary shall 
        design standards that--
                    ``(A) ensure, in conjunction with the requirements 
                under paragraph (3)(B), that the average fuel economy 
                of replacement tires is not less than the average fuel 
                economy of tires sold as original equipment;
                    ``(B) secure the maximum technically feasible and 
                cost-effective fuel savings;
                    ``(C) do not adversely affect tire safety;
                    ``(D) incorporate the results from--
                            ``(i) laboratory testing; and
                            ``(ii) to the extent appropriate and 
                        available, on-road fleet testing programs 
                        conducted by manufacturers; and
                    ``(E) do not adversely affect efforts to manage 
                scrap tires.
            ``(5) Applicability.--The policies, procedures, and 
        standards developed under paragraph (3) shall apply to all tire 
        types and models regulated under the uniform tire quality 
        grading standards in section 575.104 of title 49, Code of 
        Federal Regulations (or a successor regulation).
            ``(6) Review.--
                    ``(A) In general.--Not less than once every 3 
                years, the Secretary shall--
                            ``(i) review the minimum fuel economy 
                        standards in effect for tires under this 
                        subsection; and
                            ``(ii) subject to subparagraph (B), revise 
                        the standards as necessary to ensure compliance 
                        with standards described in paragraph (4).
                    ``(B) Limitation.--The Secretary may not reduce the 
                average fuel economy standards applicable to 
                replacement tires.
            ``(7) No preemption of state law.--Nothing in this section 
        shall be construed to preempt any provision of State law 
        relating to higher fuel economy standards applicable to 
        replacement tires designed for use on passenger cars and light 
        trucks.
            ``(8) Exceptions.--Nothing in this section shall apply to--
                    ``(A) a tire or group of tires with the same stock 
                keeping unit, plant, and year, for which the volume of 
                tires produced or imported is less than 15,000 
                annually;
                    ``(B) a deep tread, winter-type snow tire, space-
                saver tire, or temporary use spare tire;
                    ``(C) a tire with a normal rim diameter of 12 
                inches or less;
                    ``(D) a motorcycle tire; or
                    ``(E) a tire manufactured specifically for use in 
                an off-road motorized recreational vehicle.''.
    (b) Conforming Amendment.--Section 30103(b)(1) of title 49, United 
States Code, is amended by striking ``When'' and inserting ``Except as 
provided in section 30123(d), if''.
    (c) Time for Implementation.--Beginning not later than March 31, 
2008, the Secretary of Transportation shall administer the national 
tire fuel efficiency program established under section 30123(d) of 
title 49, United States Code, in accordance with the policies, 
procedures, and standards developed under section 30123(d)(3) of such 
title.
    (d) Authorization of Appropriations.--There are authorized to be 
appropriated, for each of fiscal years 2008 through 2012, such sums as 
may be necessary to carry out section 30123(d) of title 49, United 
States Code, as added by subsection (a).

SEC. 202. REDUCTION OF SCHOOL BUS IDLING.

    (a) Statement of Policy.--Congress encourages each local 
educational agency (as defined in section 9101(26) of the Elementary 
and Secondary Education Act of 1965 (20 U.S.C. 7801(26))) that receives 
Federal funds under the Elementary and Secondary Education Act of 1965 
(20 U.S.C. 6301 et seq.) to develop a policy to reduce the incidence of 
school bus idling at schools while picking up and unloading students.
    (b) Authorization of Appropriations.--There are authorized to be 
appropriated to the Administrator of the Environmental Protection 
Agency, working in coordination with the Secretary of Education, 
$5,000,000 for each of fiscal years 2008 through 2012 for use in 
educating States and local education agencies about--
            (1) benefits of reducing school bus idling; and
            (2) ways in which school bus idling may be reduced.

SEC. 203. FUEL EFFICIENCY FOR HEAVY DUTY TRUCKS.

    Part C of subtitle VI of title 49, United States Code, is amended 
by inserting after chapter 329 the following:

        ``CHAPTER 330--HEAVY DUTY VEHICLE FUEL ECONOMY STANDARDS

``Sec.
``33001. Purpose and policy.
``33002. Definition.
``33003. Testing and assessment.
``33004. Standards.
``33005. Authorization of appropriations.
``Sec. 33001. Purpose and policy
    ``The purpose of this chapter is to reduce petroleum consumption by 
heavy duty motor vehicles.
``Sec. 33002. Definition
    ``In this chapter, the term `heavy duty motor vehicle'--
            ``(1) means a vehicle having a gross vehicle weight rating 
        of at least 10,000 pounds that is driven or drawn by mechanical 
        power and manufactured primarily for use on public streets, 
        roads, and highways; and
            ``(2) does not include a vehicle operated only on a rail 
        line.
``Sec. 33003. Testing and assessment
    ``(a) General Requirements.--The Administrator of the Environmental 
Protection Agency (referred to in this section as the `Administrator') 
shall develop and coordinate a national testing and assessment program 
to--
            ``(1) determine the fuel economy of heavy duty vehicles; 
        and
            ``(2) assess the fuel efficiency attainable through 
        available technology.
    ``(b) Testing.--The Administrator shall--
            ``(1) design a National testing program to assess the fuel 
        economy of heavy duty vehicles (based on the program for light 
        duty vehicles); and
            ``(2) implement the program described in paragraph (1) not 
        later than 18 months after the date of enactment of this 
        chapter.
    ``(c) Assessment.--The Administrator shall consult with the 
Secretary of Transportation on the assessment of available technologies 
to enhance the fuel efficiency of heavy duty vehicles to ensure that 
vehicle use and needs are considered appropriately in the assessment.
    ``(d) Reporting.--The Administrator shall--
            ``(1) not later than 2 years after the date of enactment of 
        this chapter, submit a report to Congress regarding the results 
        of the assessment of available technologies to improve the fuel 
        efficiency of heavy duty vehicles.
            ``(2) submit a report to Congress, at least biannually, 
        that addresses the fuel economy of heavy duty vehicles; and
``Sec. 33004. Standards
    ``(a) General Requirements.--Not later than 18 months after 
completing the testing and assessments under section 33003, the 
Secretary of Transportation shall prescribe average heavy duty vehicle 
fuel economy standards. Each standard shall be the maximum feasible 
average fuel economy level that the Secretary decides that 
manufacturers can achieve in that model year. The Secretary may 
prescribe separate standards for different classes of heavy duty motor 
vehicles. The standards for each model year shall be completed not 
later than 18 months before the beginning of each model year.
    ``(b) Considerations and Consultation.--In determining maximum 
feasible average fuel economy, the Secretary shall consider--
            ``(1) relevant available heavy duty motor vehicle fuel 
        consumption information;
            ``(2) technological feasibility;
            ``(3) economic practicability;
            ``(4) the desirability of reducing United States dependence 
        on oil;
            ``(5) the effects of average fuel economy standards on 
        vehicle safety;
            ``(6) the effects of average fuel economy standards on 
        levels of employment and competitiveness of manufacturers; and
            ``(7) the extent to which the standard will carry out the 
        purpose described in section 33001.
    ``(c) Cooperation.--The Secretary may advise, assist, and cooperate 
with departments, agencies, and instrumentalities of the United States 
Government, States, and other public and private agencies in developing 
fuel economy standards for heavy duty motor vehicles.
    ``(d) Effective Dates of Standards.--The Secretary shall specify 
the effective date and model years of each heavy duty motor vehicle 
fuel economy standard prescribed under this chapter.
    ``(e) 5-Year Plan for Testing Standards.--The Secretary shall 
establish, periodically review, and continually update a 5-year plan 
for testing heavy duty motor vehicle fuel economy standards prescribed 
under this chapter. In developing and establishing testing priorities, 
the Secretary shall consider factors the Secretary considers 
appropriate, consistent with the purpose described in section 33001 and 
the Secretary's other duties and powers under this chapter.
``Sec. 33005. Authorization of appropriations
    ``There are authorized to be appropriated, for each of fiscal years 
2008 through 2012, such sums as may be necessary to carry out this 
chapter.''.

SEC. 204. LIGHTWEIGHT MATERIALS RESEARCH AND DEVELOPMENT.

    (a) In General.--As soon as practicable after the date of enactment 
of this Act, the Secretary of Energy shall establish a research and 
development program to determine ways in which--
            (1) the weight of vehicles may be reduced to improve fuel 
        efficiency without compromising passenger safety; and
            (2) the cost of lightweight materials (such as steel alloys 
        and carbon fibers) required for the construction of lighter-
        weight vehicles may be reduced.
    (b) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $50,000,000 for each of fiscal 
years 2008 through 2012.

SEC. 205. HYBRID AND ADVANCED DIESEL VEHICLES.

    (a) Hybrid Vehicles.--The Energy Policy Act of 2005 is amended by 
striking section 711 (42 U.S.C. 16061) and inserting the following:

``SEC. 711. HYBRID VEHICLES.

    ``(a) Definitions.--In this section:
            ``(1) Cost.--The term `cost' has the meaning given the term 
        `cost of a loan guarantee' within the meaning of section 
        502(5)(C) of the Federal Credit Reform Act of 1990 (2 U.S.C. 
        661a(5)(C)).
            ``(2) Eligible project.--The term `eligible project' means 
        a project to--
                    ``(A) improve hybrid technologies under subsection 
                (b); or
                    ``(B) encourage domestic production of efficient 
                hybrid and advanced diesel vehicles under section 
                712(a).
            ``(3) Guarantee.--
                    ``(A) In general.--The term `guarantee' has the 
                meaning given the term `loan guarantee' in section 502 
                of the Federal Credit Reform Act of 1990 (2 U.S.C. 
                661a).
                    ``(B) Inclusion.--The term `guarantee' includes a 
                loan guarantee commitment (as defined in section 502 of 
                the Federal Credit Reform Act of 1990 (2 U.S.C. 661a)).
            ``(4) Hybrid technology.--The term `hybrid technology' 
        means a battery or other rechargeable energy storage system, 
        power electronic, hybrid systems integration, and any other 
        technology for use in hybrid vehicles, including plug-in hybrid 
        vehicles and their components.
            ``(5) Obligation.--The term `obligation' means the loan or 
        other debt obligation that is guaranteed under this section.
    ``(b) Authorization.--The Secretary shall accelerate efforts 
directed toward the improvement of hybrid technologies, including 
through the provision of loan guarantees under subsection (c).
    ``(c) Loan Guarantees.--
            ``(1) In general.--The Secretary shall make guarantees 
        under this section for eligible projects on such terms and 
        conditions as the Secretary, in consultation with the Secretary 
        of the Treasury, determines to be appropriate.
            ``(2) Specific appropriation or contribution.--No guarantee 
        shall be made unless--
                    ``(A) an appropriation for the cost has been made; 
                or
                    ``(B) the Secretary has received from the borrower 
                a payment in full for the cost of the obligation and 
                deposited the payment into the Treasury.
            ``(3) Amount.--Unless otherwise provided by law, a 
        guarantee by the Secretary shall not exceed an amount equal to 
        80 percent of the project cost of the hybrid technology that is 
        the subject of the guarantee, as estimated at the time at which 
        the guarantee is issued.
            ``(4) Repayment.--
                    ``(A) In general.--No guarantee shall be made 
                unless the Secretary determines that there is a 
                reasonable prospect of repayment of the principal and 
                interest on the obligation by the borrower.
                    ``(B) Amount.--No guarantee shall be made unless 
                the Secretary determines that the amount of the 
                obligation (when combined with amounts available to the 
                borrower from other sources) will be sufficient to 
                carry out the project.
                    ``(C) Subordination.--The obligation shall be 
                subject to the condition that the obligation is not 
                subordinate to other financing.
            ``(5) Interest rate.--An obligation shall bear interest at 
        a rate that does not exceed a level that the Secretary 
        determines appropriate, taking into account the prevailing rate 
        of interest in the private sector for similar loans and risks.
            ``(6) Term.--The term of an obligation shall require full 
        repayment over a period not to exceed the lesser of--
                    ``(A) 30 years; or
                    ``(B) 90 percent of the projected useful life of 
                the physical asset to be financed by the obligation (as 
                determined by the Secretary).
            ``(7) Defaults.--
                    ``(A) Payment by secretary.--
                            ``(i) In general.--If a borrower defaults 
                        on the obligation (as defined in regulations 
                        promulgated by the Secretary and specified in 
                        the guarantee contract), the holder of the 
                        guarantee shall have the right to demand 
                        payment of the unpaid amount from the 
                        Secretary.
                            ``(ii) Payment required.--Within such 
                        period as may be specified in the guarantee or 
                        related agreements, the Secretary shall pay to 
                        the holder of the guarantee the unpaid interest 
                        on, and unpaid principal of the obligation as 
                        to which the borrower has defaulted, unless the 
                        Secretary finds that--
                                    ``(I) there was no default by the 
                                borrower in the payment of interest or 
                                principal; or
                                    ``(II) the default has been 
                                remedied.
                            ``(iii) Forbearance.--Nothing in this 
                        subsection precludes any forbearance by the 
                        holder of the obligation for the benefit of the 
                        borrower that may be agreed upon by the parties 
                        to the obligation and approved by the 
                        Secretary.
                    ``(B) Subrogation.--
                            ``(i) In general.--If the Secretary makes a 
                        payment under subparagraph (A), the Secretary 
                        shall be subrogated to the rights of the 
                        recipient of the payment as specified in the 
                        guarantee or related agreements including, 
                        where appropriate, the authority 
                        (notwithstanding any other provision of law) 
                        to--
                                    ``(I) complete, maintain, operate, 
                                lease, or otherwise dispose of any 
                                property acquired pursuant to the 
                                guarantee or related agreements; or
                                    ``(II) permit the borrower, 
                                pursuant to an agreement with the 
                                Secretary, to continue to pursue the 
                                purposes of the eligible project, as 
                                the Secretary determines to be in the 
                                public interest.
                            ``(ii) Superiority of rights.--The rights 
                        of the Secretary, with respect to any property 
                        acquired pursuant to a guarantee or related 
                        agreement, shall be superior to the rights of 
                        any other person with respect to the property.
                            ``(iii) Terms and conditions.--A guarantee 
                        agreement shall include such detailed terms and 
                        conditions as the Secretary determines 
                        appropriate to--
                                    ``(I) protect the interests of the 
                                United States in the case of default; 
                                and
                                    ``(II) have available all the 
                                patents and technology necessary for 
                                any person selected, including the 
                                Secretary, to complete and operate the 
                                eligible project.
                    ``(C) Payment of principal and interest by 
                secretary.--With respect to any obligation guaranteed 
                under this section, the Secretary may enter into a 
                contract to pay, and pay, holders of the obligation, 
                for and on behalf of the borrower, from funds 
                appropriated for that purpose, the principal and 
                interest payments that become due and payable on the 
                unpaid balance of the obligation if the Secretary finds 
                that--
                            ``(i)(I) the borrower is unable to meet the 
                        payments and is not in default;
                            ``(II) it is in the public interest to 
                        permit the borrower to continue to pursue the 
                        purposes of the eligible project; and
                            ``(III) the probable net benefit to the 
                        Federal Government in paying the principal and 
                        interest will be greater than the benefit that 
                        would result in the event of a default;
                            ``(ii) the amount of the payment that the 
                        Secretary is authorized to pay will be no 
                        greater than the amount of principal and 
                        interest that the borrower is obligated to pay 
                        under the agreement being guaranteed; and
                            ``(iii) the borrower agrees to reimburse 
                        the Secretary for the payment (including 
                        interest) on terms and conditions that are 
                        satisfactory to the Secretary.
                    ``(D) Action by attorney general.--
                            ``(i) Notification.--If the borrower 
                        defaults on an obligation, the Secretary shall 
                        notify the Attorney General of the default.
                            ``(ii) Recovery.--On receipt of 
                        notification, the Attorney General shall take 
                        such action as the Attorney General determines 
                        to be appropriate to recover the unpaid 
                        principal and interest due from--
                                    ``(I) such assets of the defaulting 
                                borrower as are associated with the 
                                obligation; or
                                    ``(II) any other security pledged 
                                to secure the obligation.
            ``(8) Fees.--
                    ``(A) In general.--The Secretary shall charge and 
                collect fees for guarantees in amounts the Secretary 
                determines are sufficient to cover applicable 
                administrative expenses.
                    ``(B) Availability.--Fees collected under this 
                paragraph shall--
                            ``(i) be deposited by the Secretary into 
                        the Treasury; and
                            ``(ii) remain available until expended, 
                        subject to such other conditions as are 
                        contained in annual appropriations Acts.
            ``(9) Records; audits.--
                    ``(A) In general.--A recipient of a guarantee shall 
                keep such records and other pertinent documents as the 
                Secretary shall prescribe by regulation, including such 
                records as the Secretary may require to facilitate an 
                effective audit.
                    ``(B) Access.--The Secretary and the Comptroller 
                General of the United States, or their duly authorized 
                representatives, shall have access, for the purpose of 
                audit, to the records and other pertinent documents.
            ``(10) Full faith and credit.--The full faith and credit of 
        the United States is pledged to the payment of all guarantees 
        issued under this section with respect to principal and 
        interest.
    ``(d) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as are necessary to provide the cost of 
guarantees under this section.''.
    (b) Efficient Hybrid and Advanced Diesel Vehicles.--Section 712(a) 
of the Energy Policy Act of 2005 (42 U.S.C. 16062(a)) is amended in the 
second sentence by striking ``grants to automobile manufacturers'' and 
inserting ``grants and the provision of loan guarantees under section 
711(c) to automobile manufacturers and suppliers''.

SEC. 206. ADVANCED TECHNOLOGY MOTOR VEHICLES MANUFACTURING CREDIT.

    (a) In General.--Subpart B of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 (relating to foreign tax credit, 
etc.) is amended by adding at the end the following new section:

``SEC. 30D. ADVANCED TECHNOLOGY MOTOR VEHICLES MANUFACTURING CREDIT.

    ``(a) Credit Allowed.--There shall be allowed as a credit against 
the tax imposed by this chapter for the taxable year an amount equal to 
the sum of--
            ``(1) in the case of a qualified investment of an eligible 
        taxpayer for such taxable year relating to plug-in hybrid 
        electric vehicles or pure electric vehicles, 50 percent of so 
        much of such qualified investment as does not exceed 
        $150,000,000, and
            ``(2) in the case of any other qualified investment of an 
        eligible taxpayer for such taxable year, 35 percent of so much 
        of such qualified investment as does not exceed $50,000,000.
    ``(b) Qualified Investment.--For purposes of this section--
            ``(1) In general.--The qualified investment for any taxable 
        year is equal to the incremental costs incurred during such 
        taxable year--
                    ``(A) to re-equip, expand, or establish any 
                manufacturing facility of the eligible taxpayer to 
                produce advanced technology motor vehicles or to 
                produce eligible components,
                    ``(B) for engineering integration of such vehicles 
                and components as described in subsection (d), and
                    ``(C) for research and development related to 
                advanced technology motor vehicles and eligible 
                components.
            ``(2) Attribution rules.--In the event a facility of the 
        eligible taxpayer produces both advanced technology motor 
        vehicles and conventional motor vehicles, or eligible and non-
        eligible components, only the qualified investment attributable 
        to production of advanced technology motor vehicles and 
        eligible components shall be taken into account.
    ``(c) Advanced Technology Motor Vehicles and Eligible Components.--
For purposes of this section--
            ``(1) Advanced technology motor vehicle.--The term 
        `advanced technology motor vehicle' means--
                    ``(A) any new advanced lean burn technology motor 
                vehicle (as defined in section 30B(c)(3)),
                    ``(B) any new qualified hybrid motor vehicle (as 
                defined in section 30B(d)(3)(A) and determined without 
                regard to any gross vehicle weight rating), or
                    ``(C) any new plug-in hybrid electric vehicle.
            ``(2) Plug-in hybrid electric vehicle.--For purposes of 
        this section, the term `plug-in hybrid electric vehicle' means 
        a light-duty, medium-duty, or heavy-duty on-road or nonroad 
        vehicle that is propelled by an internal combustion engine or 
        heat engine and/or an electric motor and energy storage system 
        using (or capable of using)--
                    ``(A) any combustible fuel,
                    ``(B) an on-board, rechargeable storage device, and
                    ``(C) a means of using an off-board source of 
                electricity to operate the vehicle in intermittent or 
                continuous all-electric mode.
            ``(3) Eligible components.--The term `eligible component' 
        means any component inherent to any advanced technology motor 
        vehicle, including--
                    ``(A) with respect to any gasoline or diesel-
                electric new qualified hybrid motor vehicle--
                            ``(i) electric motor or generator,
                            ``(ii) power split device,
                            ``(iii) power control unit,
                            ``(iv) power controls,
                            ``(v) integrated starter generator, or
                            ``(vi) battery,
                    ``(B) with respect to any hydraulic new qualified 
                hybrid motor vehicle--
                            ``(i) hydraulic accumulator vessel,
                            ``(ii) hydraulic pump, or
                            ``(iii) hydraulic pump-motor assembly,
                    ``(C) with respect to any new advanced lean burn 
                technology motor vehicle--
                            ``(i) diesel engine,
                            ``(ii) turbocharger,
                            ``(iii) fuel injection system, or
                            ``(iv) after-treatment system, such as a 
                        particle filter or NOx absorber, and
                    ``(D) with respect to any advanced technology motor 
                vehicle, any other component submitted for approval by 
                the Secretary.
    ``(d) Engineering Integration Costs.--For purposes of subsection 
(b)(1)(B), costs for engineering integration are costs incurred prior 
to the market introduction of advanced technology vehicles for 
engineering tasks related to--
            ``(1) establishing functional, structural, and performance 
        requirements for component and subsystems to meet overall 
        vehicle objectives for a specific application,
            ``(2) designing interfaces for components and subsystems 
        with mating systems within a specific vehicle application,
            ``(3) designing cost effective, efficient, and reliable 
        manufacturing processes to produce components and subsystems 
        for a specific vehicle application, and
            ``(4) validating functionality and performance of 
        components and subsystems for a specific vehicle application.
    ``(e) Eligible Taxpayer.--For purposes of this section, the term 
`eligible taxpayer' means any taxpayer if more than 50 percent of its 
gross receipts for the taxable year is derived from the manufacture of 
motor vehicles or any component parts of such vehicles.
    ``(f) Limitation Based on Amount of Tax.--The credit allowed under 
subsection (a) for the taxable year shall not exceed the excess of--
            ``(1) the sum of--
                    ``(A) the regular tax liability (as defined in 
                section 26(b)) for such taxable year, plus
                    ``(B) the tax imposed by section 55 for such 
                taxable year and any prior taxable year beginning after 
                1986 and not taken into account under section 53 for 
                any prior taxable year, over
            ``(2) the sum of the credits allowable under subpart A and 
        sections 27, 30, and 30B for the taxable year.
    ``(g) Reduction in Basis.--For purposes of this subtitle, if a 
credit is allowed under this section for any expenditure with respect 
to any property, the increase in the basis of such property which would 
(but for this paragraph) result from such expenditure shall be reduced 
by the amount of the credit so allowed.
    ``(h) No Double Benefit.--
            ``(1) Coordination with other deductions and credits.--
        Except as provided in paragraph (2), the amount of any 
        deduction or other credit allowable under this chapter for any 
        cost taken into account in determining the amount of the credit 
        under subsection (a) shall be reduced by the amount of such 
        credit attributable to such cost.
            ``(2) Research and development costs.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), any amount described in subsection 
                (b)(1)(C) taken into account in determining the amount 
                of the credit under subsection (a) for any taxable year 
                shall not be taken into account for purposes of 
                determining the credit under section 41 for such 
                taxable year.
                    ``(B) Costs taken into account in determining base 
                period research expenses.--Any amounts described in 
                subsection (b)(1)(C) taken into account in determining 
                the amount of the credit under subsection (a) for any 
                taxable year which are qualified research expenses 
                (within the meaning of section 41(b)) shall be taken 
                into account in determining base period research 
                expenses for purposes of applying section 41 to 
                subsequent taxable years.
    ``(i) Business Carryovers Allowed.--If the credit allowable under 
subsection (a) for a taxable year exceeds the limitation under 
subsection (f) for such taxable year, such excess (to the extent of the 
credit allowable with respect to property subject to the allowance for 
depreciation) shall be allowed as a credit carryback and carryforward 
under rules similar to the rules of section 39.
    ``(j) Special Rules.--For purposes of this section, rules similar 
to the rules of paragraphs (4) and (5) of section 179A(e) and 
paragraphs (1) and (2) of section 41(f) shall apply
    ``(k) Election Not to Take Credit.--No credit shall be allowed 
under subsection (a) for any property if the taxpayer elects not to 
have this section apply to such property.
    ``(l) Regulations.--The Secretary shall prescribe such regulations 
as necessary to carry out the provisions of this section.
    ``(m) Termination.--This section shall not apply to any qualified 
investment after December 31, 2015.''.
    (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 30D(g).''.
            (2) Section 6501(m) of such Code is amended by inserting 
        ``30D(k),'' after ``30C(e)(5),''.
            (3) The table of sections for subpart B of part IV of 
        subchapter A of chapter 1 of such Code is amended by inserting 
        after the item relating to section 30C the following new item:

``Sec. 30D. Advanced technology motor vehicles manufacturing credit.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to amounts incurred in taxable years beginning after December 31, 
2006.

SEC. 207. CONSUMER INCENTIVES TO PURCHASE ADVANCED TECHNOLOGY VEHICLES.

    (a) Flexible Fuel Vehicle Credit.--
            (1) In general.--Subpart B of part IV of subchapter A of 
        chapter 1 of the Internal Revenue Code of 1986 (relating to 
        foreign tax credit, etc.), as amended by this Act, is amended 
        by adding at the end the following new section:

``SEC. 30E. FLEXIBLE FUEL VEHICLE CREDIT.

    ``(a) Allowance of Credit.--There shall be allowed as a credit 
against the tax imposed by this chapter for the taxable year an amount 
equal to the GEM flexible fuel vehicle credit.
    ``(b) GEM Flexible Fuel Vehicle Credit.--
            ``(1) In general.--For the purposes of subsection (a), the 
        GEM flexible fuel vehicle credit determined under this 
        subsection for the taxable year is the credit amount determined 
        under paragraph (2) with respect to a GEM flexible fuel vehicle 
        placed in service by the taxpayer during the taxable year.
            ``(2) Credit amount.--In the case of a new qualified GEM 
        flexible fuel 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 shall be $300.
    ``(c) Definitions.--For purposes of this section--
            ``(1) Gem flexible fuel vehicle.--The term `GEM flexible 
        fuel vehicle' means a motor vehicle warrantied by its 
        manufacturer to operate on any combination of gasoline, E85, 
        and M85.
            ``(2) E85.--The term `E85' means a fuel blend containing 85 
        percent ethanol and 15 percent gasoline by volume.
            ``(3) M85.--The term `M85' means a fuel blend containing 85 
        percent methanol and 15 percent gasoline by volume.
    ``(d) Termination.--This section shall not apply to taxable years 
beginning after December 31, 2010.''.
            (2) Clerical amendment.--The table of sections for subpart 
        B of part IV of subchapter A of chapter 1 of the Internal 
        Revenue Code of 1986 (relating to foreign tax credit, etc.), as 
        amended by this Act, is amended by adding at the end the 
        following new item:

``Sec. 30E. Flexible fuel vehicle credit.''.
    (b) Elimination on Number of New Qualified Hybrid and Advanced Lean 
Burn Technology Vehicles Eligible for Alternative Motor Vehicle 
Credit.--
            (1) In general.--Section 30B of the Internal Revenue Code 
        of 1986 is amended by striking subsection (f) and by 
        redesignating subsections (g) through (j) as subsections (f) 
        through (i), respectively.
            (2) Conforming amendments.--
                    (A) Paragraphs (4) and (6) of section 30B(h) of the 
                Internal Revenue Code of 1986 are each amended by 
                striking ``(determined without regard to subsection 
                (g))'' and inserting ``determined without regard to 
                subsection (f))''.
                    (B) Section 38(b)(25) of such Code is amended by 
                striking ``section 30B(g)(1)'' and inserting ``section 
                30B(f)(1)''.
                    (C) Section 55(c)(2) of such Code is amended by 
                striking ``section 30B(g)(2)'' and inserting ``section 
                30B(f)(2)''.
                    (D) Section 1016(a)(36) of such Code is amended by 
                striking ``section 30B(h)(4)'' and inserting ``section 
                30B(g)(4)''.
                    (E) Section 6501(m) of such Code is amended by 
                striking ``section 30B(h)(9)'' and inserting ``section 
                30B(g)(9)''.
    (c) Extension of Alternative Vehicle Credit for New Qualified 
Hybrid Motor Vehicles.--Paragraph (3) of section 30B(i) of the Internal 
Revenue Code of 1986 (as redesignated by subsection (a)) is amended by 
striking ``December 31, 2009'' and inserting ``December 31, 2010''.
    (d) Effective Date.--The amendments made by this section shall 
apply to property placed in service after December 31, 2006, in taxable 
years ending after such date.

SEC. 208. FEDERAL FLEET REQUIREMENTS.

    (a) Regulations.--
            (1) In general.--The Secretary of Energy shall issue 
        regulations for Federal fleets subject to the Energy Policy Act 
        of 1992 (42 U.S.C. 13201 et seq.) requiring that not later than 
        fiscal year 2015 each Federal agency achieve at least a 20 
        percent reduction in petroleum consumption, as calculated from 
        the baseline established by the Secretary for fiscal year 1999.
            (2) Requirement.--Not later than fiscal year 2011, of the 
        Federal vehicles required to be alternative fueled vehicles 
        under title V of the Energy Policy Act of 1992 (42 U.S.C. 13251 
        et seq.), at least 30 percent shall be flexible fuel hybrid 
        motor vehicles or flexible fuel plug-in hybrid motor vehicles.
            (3) Exception.--The regulations issued under this 
        subsection shall not apply to ground vehicles of the Department 
        of Defense whose primary purpose is combat or the support of 
        troops in combat operations.
    (b) Inclusion of Electric Drive in Energy Policy Act of 1992.--
Section 508(a) of the Energy Policy Act of 1992 (42 U.S.C. 13258(a)) is 
amended--
            (1) by inserting ``(1)'' before ``The Secretary''; and
            (2) by adding at the end the following:
    ``(2) Not later than January 31, 2008, the Secretary shall--
            ``(A) allocate credit in an amount to be determined by the 
        Secretary for--
                    ``(i) acquisition of--
                            ``(I) a light-duty hybrid electric vehicle;
                            ``(II) a plug-in hybrid electric vehicle;
                            ``(III) a fuel cell electric vehicle;
                            ``(IV) a medium- or heavy-duty hybrid 
                        electric vehicle;
                            ``(V) a neighborhood electric vehicle; or
                            ``(VI) a medium- or heavy-duty dedicated 
                        vehicle; and
                    ``(ii) investment in qualified alternative fuel 
                infrastructure or nonroad equipment, as determined by 
                the Secretary; and
            ``(B) allocate more than 1, but not to exceed 5, credits 
        for investment in an emerging technology relating to any 
        vehicle described in subparagraph (A) to encourage--
                    ``(i) a reduction in petroleum demand;
                    ``(ii) technological advancement; and
                    ``(iii) environmental safety.''.
    (c) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section (including the amendments made 
by subsection (b)) $10,000,000 for the period of fiscal years 2008 
through 2012.

SEC. 209. TAX INCENTIVES FOR PRIVATE FLEETS.

    (a) In General.--Subpart E of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by inserting after 
section 48B the following new section:

``SEC. 48C. FUEL-EFFICIENT FLEET CREDIT.

    ``(a) General Rule.--For purposes of section 46, the fuel-efficient 
fleet credit for any taxable year is 15 percent of the qualified fuel-
efficient vehicle investment amount of an eligible taxpayer for such 
taxable year.
    ``(b) Vehicle Purchase Requirement.--In the case of any eligible 
taxpayer which places less than 10 qualified fuel-efficient vehicles in 
service during the taxable year, the qualified fuel-efficient vehicle 
investment amount shall be zero.
    ``(c) Qualified Fuel-Efficient Vehicle Investment Amount.--For 
purposes of this section--
            ``(1) In general.--The term `qualified fuel-efficient 
        vehicle investment amount' means the basis of any qualified 
        fuel-efficient vehicle placed in service by an eligible 
        taxpayer during the taxable year.
            ``(2) Qualified fuel-efficient vehicle.--The term 
        `qualified fuel-efficient vehicle' means an automobile which 
        has a fuel economy which is at least 10 percent greater than 
        the average fuel economy standard for an automobile of the same 
        class and model year.
            ``(3) Other terms.--The terms `automobile', `average fuel 
        economy standard', `fuel economy', and `model year' have the 
        meanings given to such terms under section 32901 of title 49, 
        United States Code.
    ``(d) Eligible Taxpayer.--The term `eligible taxpayer' means, with 
respect to any taxable year, a taxpayer who owns a fleet of 100 or more 
vehicles which are used in the trade or business of the taxpayer on the 
first day of such taxable year.
    ``(e) Termination.--This section shall not apply to any vehicle 
placed in service after December 31, 2010.''.
    (b) Credit Treated as Part of Investment Credit.--Section 46 of the 
Internal Revenue Code of 1986 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 fuel-efficient fleet credit.''.
    (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 at the end the following new clause:
                            ``(v) the basis of any qualified fuel-
                        efficient vehicle which is taken into account 
                        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 48 the following new item:

``Sec. 48C. Fuel-efficient fleet credit.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to periods after December 31, 2006, 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. 210. REDUCING INCENTIVES TO GUZZLE GAS.

    (a) Inclusion of Heavy Vehicles in Limitation on Depreciation of 
Certain Luxury Automobiles.--
            (1) In general.--Section 280F(d)(5)(A) of the Internal 
        Revenue Code of 1986 (defining passenger automobile) is 
        amended--
                    (A) by striking clause (ii) and inserting the 
                following new clause:
                            ``(ii)(I) which is rated at 6,000 pounds 
                        unloaded gross vehicle weight or less, or
                            ``(II) which is rated at more than 6,000 
                        pounds but not more than 14,000 pounds gross 
                        vehicle weight.'', and
                    (B) by striking ``clause (ii)'' in the second 
                sentence and inserting ``clause (ii)(I)''.
            (2) Exception for vehicles used in farming business.--
        Section 280F(d)(5)(B) of such Code (relating to exception for 
        certain vehicles) is amended by striking ``and'' at the end of 
        clause (ii), by redesignating clause (iii) as clause (iv), and 
        by inserting after clause (ii) the following new clause:
                            ``(iii) any vehicle used in a farming 
                        business (as defined in section 263A(e)(4), 
                        and''.
            (3) Effective date.--The amendments made by this subsection 
        shall apply to property placed in service after the date of the 
        enactment of this Act.
    (b) Updated Depreciation Deduction Limits.--
            (1) In general.--Subparagraph (A) of section 280F(a)(1) of 
        the Internal Revenue Code of 1986 (relating to limitation on 
        amount of depreciation for luxury automobiles) is amended to 
        read as follows:
                    ``(I) Limitation.--The amount of the depreciation 
                deduction for any taxable year shall not exceed for any 
                passenger automobile--
                            ``(i) for the 1st taxable year in the 
                        recovery period--
                                    ``(I) described in subsection 
                                (d)(5)(A)(ii)(I), $4,000,
                                    ``(II) described in the second 
                                sentence of subsection (d)(5)(A), 
                                $5,000, and
                                    ``(III) described in subsection 
                                (d)(5)(A)(ii)(II), $6,000,
                            ``(ii) for the 2nd taxable year in the 
                        recovery period--
                                    ``(I) described in subsection 
                                (d)(5)(A)(ii)(I), $6,400,
                                    ``(II) described in the second 
                                sentence of subsection (d)(5)(A), 
                                $8,000, and
                                    ``(III) described in subsection 
                                (d)(5)(A)(ii)(II), $9,600,
                            ``(iii) for the 3rd taxable year in the 
                        recovery period--
                                    ``(I) described in subsection 
                                (d)(5)(A)(ii)(I), $3,850,
                                    ``(II) described in the second 
                                sentence of subsection (d)(5)(A), 
                                $4,800, and
                                    ``(III) described in subsection 
                                (d)(5)(A)(ii)(II), $5,775, and
                            ``(iv) for each succeeding taxable year in 
                        the recovery period--
                                    ``(I) described in subsection 
                                (d)(5)(A)(ii)(I), $2,325,
                                    ``(II) described in the second 
                                sentence of subsection (d)(5)(A), 
                                $2,900, and
                                    ``(III) described in subsection 
                                (d)(5)(A)(ii)(II), $3,475.''.
            (2) Years after recovery period.--Section 280F(a)(1)(B)(ii) 
        of such Code is amended to read as follows:
                            ``(ii) Limitation.--The amount treated as 
                        an expense under clause (i) for any taxable 
                        year shall not exceed for any passenger 
                        automobile--
                                    ``(I) described in subsection 
                                (d)(5)(A)(ii)(I), $2,325,
                                    ``(II) described in the second 
                                sentence of subsection (d)(5)(A), 
                                $2,900, and
                                    ``(III) described in subsection 
                                (d)(5)(A)(ii)(II), $3,475.''.
            (3) Inflation adjustment.--Section 280F(d)(7) of such Code 
        (relating to automobile price inflation adjustment) is 
        amended--
                    (A) by striking ``after 1988'' in subparagraph (A) 
                and inserting ``after 2006'', and
                    (B) by striking subparagraph (B) and inserting the 
                following new subparagraph:
                    ``(B) Automobile price inflation adjustment.--For 
                purposes of this paragraph--
                            ``(i) In general.--The automobile price 
                        inflation adjustment for any calendar year is 
                        the percentage (if any) by which--
                                    ``(I) the average wage index for 
                                the preceding calendar year, exceeds
                                    ``(II) the average wage index for 
                                2005.
                            ``(ii) Average wage index.--The term 
                        `average wage index' means the average wage 
                        index published by the Social Security 
                        Administration.''.
            (4) Effective date.--The amendments made by this subsection 
        shall apply to property placed in service after the date of the 
        enactment of this Act.
    (c) Expensing Limitation for Farm Vehicles.--
            (1) In general.--Paragraph (6) of section 179(b) of the 
        Internal Revenue Code of 1986 (relating to limitations) is 
        amended to read as follows:
            ``(6) Limitation on cost taken into account for farm 
        vehicles.--The cost of any vehicle described in section 
        280F(d)(5)(B)(iii) for any taxable year which may be taken into 
        account under this section shall not exceed $30,000.''.
            (2) Effective date.--The amendment made by this subsection 
        shall apply to property placed in service after the date of the 
        enactment of this Act.

SEC. 211. FUEL CHOICE FOR TRANSPORTATION.

    (a) Definitions.--In this section:
            (1) Alternative fuel; alternative fuel automobile.--The 
        terms ``alternative fuel'' and ``alternative fuel automobile'' 
        have the meanings given such terms in section 32901 of title 
        49, United States Code.
            (2) E85.--The term ``E85'' means a fuel blend containing 85 
        percent ethanol and 15 percent gasoline by volume.
            (3) M85.--The term ``M85'' means a fuel blend containing 85 
        percent methanol and 15 percent gasoline by volume.
            (4) Flexible fuel vehicle.--The term ``flexible fuel 
        vehicle'' means a motor vehicle warranted by its manufacturer 
        to operate on any and all blends of gasoline, E85, and M85.
            (5) Fuel choice-enabling motor vehicle.--The term ``fuel 
        choice-enabling motor vehicle'' means--
                    (A) a flexible fuel motor vehicle; or
                    (B) a vehicle warranted by its manufacturer to 
                operate on biodiesel.
            (6) Light-duty motor vehicle.--The term ``light-duty motor 
        vehicle'' means, as defined in regulations promulgated by the 
        Administrator of the Environmental Protection Agency in effect 
        on the date of enactment of this Act--
                    (A) a light-duty truck; or
                    (B) a light-duty vehicle.
    (b) Fuel Choice for Transportation.--
            (1) Rulemaking.--Not later than 1 year after the date of 
        enactment of this Act, the Secretary of Transportation shall 
        issue regulations to carry out the provisions of this 
        subsection.
            (2) Schedule.--Not less than 50 percent of each light-duty 
        motor vehicles manufacturer's annual production of passenger 
        cars manufactured on and after January 1, 2012, and before 
        January 1, 2013, and no less than 80 percent of each 
        manufacturer's production of passenger cars manufactured on and 
        after January 1, 2013 shall be fuel choice enabling motor 
        vehicles or alternative fuel automobiles.
            (3) Temporary exemption from requirements.--Upon 
        application by a manufacturer, in such manner and containing 
        such information as the Secretary shall prescribe in the 
        regulations promulgated under this section, the Secretary may 
        at any time, under such terms and conditions and to such extent 
        as the Secretary deems appropriate, temporarily exempt or renew 
        the exemption of a motor vehicle from the requirements of 
        subsection (b) if the Secretary finds that there has been a 
        disruption in the supply of any component required for 
        compliance with the regulations, or a disruption in the use and 
        installation by the manufacturer of such component due to 
        unavoidable events not under the control of the manufacturer, 
        that will prevent a manufacturer from meeting its anticipated 
        production volume of vehicles that meet the requirements of 
        this subsection. Each application for such exemption must be 
        filed by the manufacturer affected, and must specify the 
        models, lines, and types of vehicles actually affected, 
        although the Secretary may consolidate applications of a 
        similar nature of 1 or more manufacturers. Any exemption or 
        renewal shall be conditioned upon the manufacturer's commitment 
        to recall the exempted vehicles for installation of omitted 
        components within a reasonable time proposed by the 
        manufacturer and approved by the Secretary after such 
        components become available in sufficient quantities to satisfy 
        both anticipated production and recall volume requirements. 
        Notice of each application shall be published in the Federal 
        Register and notice of each decision to grant or deny a 
        temporary exemption, and the reasons for granting or denying 
        it, shall be published in the Federal Register. The Secretary 
        shall require labeling for each exempted motor vehicle which 
        can only be removed after recall and installation of the 
        required components. If a vehicle is delivered without the fuel 
        choice capability required in this section, the Secretary shall 
        require that written notification of the exemption be delivered 
        to the dealer and first purchasers for purposes other than 
        resale of such exempted motor vehicle in such a manner, and 
        containing such information, as the Secretary deems 
        appropriate.

SEC. 212. FLEXIBLE FUEL VEHICLE ECONOMY CALCULATIONS.

    (a) In General.--Section 32905 of title 49, United States Code, is 
amended--
            (1) in subsections (b) and (d)--
                    (A) by amending paragraph (1) of each subsection to 
                read as follows:
            ``(1) the number determined by--
                    ``(A) subtracting from 1.0 the alternative fuel use 
                factor for the model; and
                    ``(B) dividing the difference calculated under 
                subparagraph (A) by the fuel economy measured under 
                section 32904(c) when operating the model on gasoline 
                or diesel fuel; and''; and
                    (B) by amending paragraph (2) of each subsection to 
                read as follows:
            ``(2) the number determined by dividing the alternative 
        fuel use factor for the model by the fuel economy measured 
        under subsection (a) when operating the model on alternative 
        fuel.''; and
            (2) by adding at the end the following:
    ``(h) Determination of Alternative Fuel Use Factor.--
            ``(1) For purposes of subsections (b) and (d), the term 
        `alternative fuel use factor' means, for a model of automobile, 
        the factor determined by the Administrator under this 
        subsection.
            ``(2) At the beginning of each calendar year, the Secretary 
        of Transportation shall estimate, by model, the aggregate 
        amount of fuel and the aggregate amount of alternative fuel 
        used to operate all dual fuel automobiles during the most 
        recent 12-month period.
            ``(3) The Administrator shall determine, by regulation, the 
        alternative fuel use factor for each model of dual fuel 
        automobile as the fraction that represents, on an energy 
        equivalent basis, the ratio that the amount of alternative fuel 
        determined under paragraph (2) bears to the amount of fuel 
        determined under paragraph (2).''.
    (b) Effective Date.--The amendments made by this section shall take 
effect on January 1, 2008.
    (c) Applicability of Existing Standards.--The amendments made by 
this section shall not affect the application of section 32901 of title 
49, United States Code, to automobiles manufactured before model year 
2008.

              TITLE III--FUEL CHOICES FOR THE 21ST CENTURY

SEC. 301. FUEL CHOICE ACTION PLAN.

    (a) Action Plan.--Not later than 1 year after the date of enactment 
of this Act, the Secretary of Energy shall transmit to the Congress an 
action plan detailing specific plans to ensure that--
            (1) not later than December 31, 2015, not less than 10 
        percent of the Nation's total ground transportation fuel demand 
        can be supplied by fuels derived from sources other than oil; 
        and
            (2) not later than December 31, 2025, not less than 20 
        percent of the Nation's total ground transportation fuel demand 
        can be supplied by fuels derived from sources other than oil.
    (b) Fuels.--The action plan may include plans for the use of fuels 
such as ethanol (derived from agricultural products, cellulosic 
bioproducts, or waste products), methanol, alternative diesel fuels, 
hydrogen, and electricity. The plan shall seek to the fullest extent 
practicable to meet the following goals:
            (1) Not less than 50 percent of the fuels will be derived 
        from renewable resources.
            (2) Not less than 50 percent of the fuels shall be produced 
        from domestic resources.
    (c) Renewable Content in Transportation Fuels.--Section 211(o) of 
the Clean Air Act (42 U.S.C. 7545(o)) is amended--
            (1) in paragraph (2)(B)--
                    (A) in clause (i)--
                            (i) by striking ``2012'' and inserting 
                        ``2015'' in the heading;
                            (ii) by striking ``2012'' and inserting 
                        ``2015''; and
                            (iii) by amending the table to read as 
                        follows:

                                    Applicable volume of renewable fuel
``Calendar year                                (in billions of gallons)
        2006...................................................    4.0 
        2007...................................................    4.7 
        2008...................................................    5.4 
        2009...................................................    6.1 
        2010...................................................    6.8 
        2011...................................................    8.0 
        2012...................................................    9.0 
        2013...................................................   11.0 
        2014...................................................   13.0 
        2015................................................... 15.0'';
                    (B) in clause (ii)--
                            (i) by striking ``2013'' and inserting 
                        ``2016'' in the heading;
                            (ii) by striking ``2013'' and inserting 
                        ``2016''; and
                            (iii) by striking ``2012'' and inserting 
                        ``2015'';
                    (C) in clause (iii), by striking ``2013'' and 
                inserting ``2016''; and
                    (D) in clause (iv)--
                            (i) by striking ``2013'' and inserting 
                        ``2016''; and
                            (ii) by striking ``2012'' and inserting 
                        ``2015'';
            (2) in paragraph (3)(A), by striking ``2011'' and inserting 
        ``2014'';
            (3) in paragraph (3)(B)(i), by striking ``2012'' and 
        inserting ``2015''; and
            (4) in paragraph (6)(A), by striking ``2012'' and inserting 
        ``2015''.

SEC. 302. ETHANOL ACTION PLAN.

    The Secretary of Energy shall complete an action plan to be 
delivered to Congress not later than 1 year after the date of enactment 
of this Act detailing specific plans to achieve a nationwide inclusion 
of not less than 10 percent ethanol in the ground transportation fuel 
supply by December 31, 2015. The plan shall seek to the fullest extent 
practicable to require that not less than 75 percent of the total 
ethanol content be produced from renewable, domestic resources.

SEC. 303. FUEL NEUTRALITY FOR ALTERNATIVE FUEL VEHICLE REFUELING 
              PROPERTY CREDIT.

    (a) Eligibility for Infrastructure Credit.--Section 30C(c)(1) of 
the Internal Revenue Code of 1986 is amended to read as follows:
            ``(1) In general.--Except as provided in paragraph (2), the 
        term `qualified alternative fuel vehicle refueling property' 
        has the meaning given to such term by section 179A(d), but only 
        with respect to any alternative fuel (as defined in section 301 
        of the Energy Policy Act of 1992 (42 U.S.C. 13211) including 
        Section 1346 of the Energy Policy Act of 2005).''.
    (b) Duration of Infrastructure Credit.--Section 30C(g) such Code is 
amended to read as follows:
    ``(g) Termination.--This section shall not apply to property placed 
in service after December 31, 2014.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to property placed in service after December 31, 2008.

SEC. 304. ALTERNATIVE FUEL VEHICLE REFUELING PROPERTY.

    (a) Increase in Credit.--
            (1) In general.--Subsection (a) of section 30C of the 
        Internal Revenue Code of 1986 is amended by striking ``30 
        percent'' and inserting ``50 percent''.
            (2) Effective date.--The amendment made by this subsection 
        shall apply to property placed in service after December 31, 
        2006, in taxable years ending after such date.
    (b) Alternative Fuel Retail Outlets.--
            (1) Owner or lessor.--For purposes of this subsection, the 
        term ``owner or lessor'' means--
                    (A) a franchisor who owns, leases, or controls a 
                retail gasoline outlet at which the franchisee is 
                authorized or permitted, under the franchise agreement, 
                to sell alternative fuel; and
                    (B) a refiner or distributor who owns, leases, or 
                controls a retail gasoline outlet.
            (2) Requirement.--Beginning in the year in which 10 percent 
        or more of the registered vehicles in a county are capable of 
        using a designated alternative fuel, each owner or lessor of a 
        retail gasoline outlet with 10 or more vehicle fuel pumps in 
        that county shall offer such designated alternative fuel at not 
        less than 10 percent of such pumps.
            (3) Compliance.--An owner or lessor is in compliance with 
        the requirement under paragraph (2) if the owner or lessor--
                    (A) provides alternative fuel at vehicle pumps 
                owned or controlled by the owner or lessor; or
                    (B) purchases credits from another owner or lessor 
                who operates more than the minimum required number of 
                alternative fuel pumps.
            (4) Projections.--Not later than July 1st of each year, the 
        Secretary of Energy shall--
                    (A) identify the counties in which at least 10 
                percent of the registered vehicles are expected to be 
                capable of using a designated alternative fuel within 
                the following 18-month period; and
                    (B) notify owners and lessors with retail gasoline 
                outlets in the counties identified under subparagraph 
                (A) of the alternative fuel pump requirement under this 
                subsection.
            (5) Rulemaking.--The Secretary of Energy shall issue 
        regulations to carry out the provisions of this subsection.

SEC. 305. USE OF CAFE PENALTIES TO BUILD ALTERNATIVE FUELING 
              INFRASTRUCTURE.

    Section 32912 of title 49, United States Code, is amended by adding 
at the end the following:
    ``(e) Alternative Fueling Infrastructure Trust Fund.--(1) There is 
established in the Treasury of the United States a trust fund, to be 
known as the Alternative Fueling Infrastructure Trust Fund, consisting 
of such amounts as are deposited into the Trust Fund under paragraph 
(2) and any interest earned on investment of amounts in the Trust Fund.
    ``(2) The Secretary of Transportation shall remit 90 percent of the 
amount collected in civil penalties under this section to the Trust 
Fund.
    ``(3) The Secretary of Energy may obligate such sums as are 
available in the Trust Fund for the Clean Cities grant program to 
increase the number of locations at which consumers may purchase fuel 
containing ethanol, biodiesel, and other alternative fuels.''.

SEC. 306. CELLULOSIC BIOMASS FUEL.

    Section 211(o)(2)(B)(iii) of the Clean Air Act (42 U.S.C. 
7545(o)(2)(B)(iii)) is amended to read as follows:
                            ``(iii) Minimum quantity derived from 
                        cellulosic biomass.--
                                    ``(I) Calendar years 2008 through 
                                2015.--For each of calendar years 2008 
                                through 2015, the applicable volume 
                                referred to in clause (ii) shall 
                                contain a minimum number of gallons 
                                that are derived from cellulosic 
                                biomass determined in accordance with 
                                the following table:

                                          Applicable minimum number of 
                                                  gallons derived from 
                                                     cellulosic biomass
``Calendar year:                              (in millions of gallons):
    2008..........................................                30.0 
    2009..........................................                45.0 
    2010..........................................                75.0 
    2011..........................................               120.0 
    2012..........................................               180.0 
    2013..........................................               250.0 
    2014..........................................               500.0 
    2015..........................................             1,000.0.
                                    ``(II) Calendar year 2016 and 
                                thereafter.--For calendar year 2016 and 
                                each calendar year thereafter, the 
                                applicable volume referred to in clause 
                                (ii) shall contain a minimum number of 
                                gallons that are derived from 
                                cellulosic biomass this is equal to the 
                                product obtained by multiplying--
                                            ``(aa) the applicable 
                                        volume referred to in clause 
                                        (ii) for the calendar year; and
                                            ``(bb) the ratio that 
                                        1,000,000,000 gallons of 
                                        cellulosic biomass bears to the 
                                        applicable volume referred to 
                                        in clause (ii) for calendar 
                                        year 2015.
                                    ``(III) Ratio.--For calendar year 
                                2008 and each calendar year thereafter, 
                                the 2.5-to-1 ratio referred to in 
                                paragraph (4) shall not apply.''.

SEC. 307. PRODUCTION INCENTIVES FOR CELLULOSIC BIOFUELS.

    Section 942(f) of the Energy Policy Act of 2005 (42 U.S.C. 
16251(f)) is amended by striking ``$250,000,000'' and inserting 
``$200,000,000 for each of fiscal years 2007 through 2011''.

SEC. 308. TRANSIT-ORIENTED DEVELOPMENT CORRIDORS.

    (a) Definitions.--In this section:
            (1) Transit-oriented development corridor.--The term 
        ``Transit-Oriented Development Corridor'' or ``TODC'' means a 
        geographic area designated by the Secretary under subsection 
        (b).
            (2) Other terms.--The terms ``fixed guide way'', ``local 
        governmental authority'', ``mass transportation'', 
        ``Secretary'', ``State'', and ``urbanized area'' have the 
        meanings given the terms in section 5302 of title 49, United 
        States Code.
    (b) Transit-Oriented Development Corridors.--
            (1) In general.--The Secretary shall develop and carry out 
        a program to designate geographic areas in urbanized areas as 
        Transit-Oriented Development Corridors.
            (2) Criteria.--An area designated as a TODC under paragraph 
        (1) shall include rights-of-way for fixed guide way mass 
        transportation facilities (including commercial development of 
        facilities that have a physical and functional connection with 
        each facility).
            (3) Number of todcs.--In consultation with State 
        transportation departments and metropolitan planning 
        organizations, the Secretary shall designate--
                    (A) not fewer than 10 TODCs by December 31, 2015; 
                and
                    (B) not fewer than 20 TODCs by December 31, 2025.
            (4) Transit grants.--
                    (A) In general.--The Secretary make grants to 
                eligible states and local governmental authorities to 
                pay the Federal share of the cost of designating 
                geographic areas in urbanized areas as TODCs.
                    (B) Application.--Each eligible State or local 
                governmental authority that desires to receive a grant 
                under this paragraph shall submit an application to the 
                Secretary, at such time, in such manner, and 
                accompanied by such additional information as the 
                Secretary may reasonably require.
                    (C) Labor standards.--Subchapter IV of chapter 31 
                of title 40, United States Code shall apply to projects 
                that receive funding under this section.
                    (D) Federal share.--The Federal share of the cost 
                of a project under this subsection shall be 50 percent.
    (c) TODC Research and Development.--To support effective deployment 
of grants and incentives under this section, the Secretary shall 
establish a TODC research and development program to conduct research 
on the best practices and performance criteria for TODCs.
    (d) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $50,000,000 for each of fiscal 
years 2008 through 2012.

SEC. 309. SAVING OIL BY REDUCING MILES-OF-TRAVEL: PILOT PROJECTS.

    (a) In General.--The Secretary of Transportation (in this section 
referred to as the ``Secretary'') shall develop and implement pilot 
projects the purpose of which is to reduce vehicle miles traveled.
    (b) Highway Congestion Tolling Evaluation Study.--The Secretary 
shall carry out evaluation projects in no less than 6 metropolitan 
areas selected by the Secretary to determine how technology can best be 
applied to assess mileage-based road user charges on major highways at 
peak-commuting times for the purposes of--
            (1) reducing oil usage;
            (2) lessening highway congestion; and
            (3) expanding travel alternatives.
    (c) Parking Cash-Out Evaluation Project.--
            (1) In general.--The Secretary shall carry out a national 
        evaluation pilot project to assess how offering commuters the 
        option to receive the cash value of their workplace parking 
        place, if any, instead of free parking can--
                    (A) reduce oil usage;
                    (B) lessen highway congestion; and
                    (C) expand travel alternatives.
            (2) Employer requirement.--Under the evaluation pilot 
        project, any employer that is participating in the pilot 
        project and offers free-of-charge commuter parking to the 
        employees of the employer must also offer a cashout alternative 
        to employees.
    (d) Report.--The Secretary shall submit to Congress every 2 years 
after the date of the enactment of this Act a report on the progress 
and results of pilot projects under this section. The report shall 
provide an analysis and summary of project implementation, changes in 
oil usage and travel demand, and other matters as deemed appropriate by 
the Secretary.
    (e) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out subsection (b) $4,000,000, and to carry out 
subsection (c) $4,000,000, for each of fiscal years 2008 through 2016.

SEC. 310. SAVING OIL BY REDUCING VEHICLE-MILES-OF-TRAVEL: RESEARCH AND 
              DEVELOPMENT.

    (a) In General.--The Secretary of Transportation shall establish a 
new research program the purpose of which is to investigate the oil-
savings potential and feasibility of programs which convert fixed costs 
of driving to variable costs.
    (b) Research Program.--The program's research shall include studies 
of the potential and feasibility of--
            (1) varying vehicle registration fees based on vehicle-
        miles of travel;
            (2) varying vehicle lease fees based on vehicle-miles of 
        travel;
            (3) varying vehicle rental rates based on vehicle-miles of 
        travel; and
            (4) other such costs which could be linked to vehicle-miles 
        of travel in order to provide incentives to reduce driving.
    (c) Report.--The Secretary shall submit to Congress and publish on 
the Department of Transportation web site at least one research product 
per year.
    (d) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section $2,000,000 for each of fiscal 
years 2008 through 2017.

SEC. 311. BIOFUELS.

    (a) Energy Policy Act of 2005 Amendments.--The Energy Policy Act of 
2005 is amended--
            (1) in section 208(c)(2)(A) by striking ``be limited to 
        sugar producers and the production of ethanol in the States of 
        Florida, Louisiana, Texas, and Hawaii, divided equally among 
        the States,'';
            (2) in section 932(a)(1)(C)(ii) by striking ``, but not 
        including municipal solid waste, gas derived from the 
        biodegradation of municipal solid waste, or paper that is 
        commonly recycled'';
            (3) in section 946(c)(1) by striking ``ethanol'' and 
        inserting ``transportation fuel produced from biomass'';
            (4) in section 1510(b) by striking ``fuel ethanol'' and 
        inserting ``transportation fuel produced from biomass,'' and
            (5) in section 1514(c)(1)(A) by striking ``biomass 
        ethanol'' and inserting ``transportation fuel produced from 
        biomass''.
    (b) Internal Revenue Code of 1986 Amendment.--
            (1) Amendment.--Section 30C(c)(1)(A) of the Internal 
        Revenue Code of 1986 is amended by striking ``one or more of 
        the following: ethanol, natural gas, compressed natural gas, 
        liquefied natural gas, liquefied petroleum gas, or hydrogen'' 
        and inserting ``an alternative fuel (as defined in section 301 
        of the Energy Policy Act of 1992 (42 U.S.C. 13211)), including 
        section 1346 of the Energy Policy Act of 2005''.
            (2) Effect.--The amendment made by paragraph (1) shall take 
        effect as if enacted by section 1342 of the Energy Policy Act 
        of 2005.
    (c) Clean Air Act Amendments.--The Clean Air Act is amended--
            (1) in section 212 (42 U.S.C. 7546)--
                    (A) by adding at the end of subsection (a) the 
                following new paragraph:
            ``(4) Biofuel.--The term `biofuel' means any transportation 
        fuel produced from biomass.''; and
                    (B) by striking ``ethanol'' each place it appears 
                and inserting ``biofuel''; and
            (2) in section 211(r) (42 U.S.C. 7545(r)) by striking 
        ``ethanol'' each place it appears and inserting ``biofuel''.

                TITLE IV--ELECTRICITY FOR TRANSPORTATION

SEC. 401. NEAR-TERM VEHICLE TECHNOLOGY PROGRAM.

    (a) Purposes.--The purposes of this section are to enhance the 
energy security of the United States, reduce dependence on imported 
oil, improve the energy efficiency of the transportation sector, and 
reduce emissions through the expansion of grid supported mobility, 
through programs to--
            (1) develop, in partnership with industry, research 
        institutions, National Laboratories, and institutions of higher 
        education, projects to foster--
                    (A) the commercialization of electric drive vehicle 
                technology for various sizes and applications of 
                vehicles, including commercialization of plug-in hybrid 
                electric vehicles and plug-in hybrid fuel cell 
                vehicles;
                    (B) growth in employment in the United States in 
                electric drive design and manufacturing of components 
                and vehicles;
                    (C) validation of the potential for plug-in hybrid 
                vehicles through fleet demonstrations and data 
                collection; and
                    (D) acceleration of fuel cell commercialization 
                through comprehensive development and commercialization 
                of the electric drive technology systems that are the 
                foundational technology of the fuel cell vehicle 
                system;
            (2) make critical public investments to help private 
        industry, institutions of higher education, National 
        Laboratories, and research institutions to expand innovation, 
        industrial growth, and jobs in the United States through the 
        development, demonstration, and commercialization of a wide 
        range of electric drive components, systems, and vehicles using 
        diverse electric drive transportation technologies;
            (3) optimize the availability of the existing electric 
        infrastructure for use in fueling light duty transportation and 
        other on-road and nonroad vehicles in lieu of vehicles and 
        equipment that use petroleum, including the more than 3,000,000 
        reported units (such as electric forklifts, golf carts, and 
        similar nonroad vehicles) in use on the date of enactment of 
        this Act; and
            (4) develop advanced communication, metering and charging 
        technologies necessary for the integration of electric drive 
        transportation technology into the smart grid of the future.
    (b) Definitions.--In this section:
            (1) Administrator.--The term ``Administrator'' means the 
        Administrator of the Environmental Protection Agency.
            (2) Battery.--The term ``battery'' means an electrochemical 
        energy storage device used in an on-road or nonroad vehicle 
        powered in whole or in part using an off-board or on-board 
        source of electricity.
            (3) Electric drive transportation technology.--The term 
        ``electric drive transportation technology'' means--
                    (A) vehicles that use an electric motor for all or 
                part of their motive power and that may or may not use 
                off-board electricity, including battery electric 
                vehicles, fuel cell vehicles, engine dominant hybrid 
                electric vehicles, plug-in hybrid electric vehicles, 
                plug-in hybrid fuel cell vehicles, and electric rail; 
                or
                    (B) equipment relating to transportation or mobile 
                sources of air pollution that use an electric motor to 
                replace an internal combustion engine for all or part 
                of the work of the equipment, including corded electric 
                equipment linked to transportation or mobile sources of 
                air pollution, and electrification technologies at 
                airports, ports, truck stops, and material handling 
                facilities.
            (4) Engine dominant hybrid electric vehicle.--The term 
        ``engine dominant hybrid electric vehicle'' means an on-road or 
        nonroad vehicle that--
                    (A) is propelled by an internal combustion engine 
                or heat engine using--
                            (i) any combustible fuel;
                            (ii) an on-board, rechargeable storage 
                        device; and
                    (B) has no means of using an off-board source of 
                electricity.
            (5) Fuel cell vehicle.--The term ``fuel cell vehicle'' 
        means an on-road or nonroad vehicle that uses a fuel cell (as 
        defined in section 3 of the Spark M. Matsunaga Hydrogen 
        Research, Development, and Demonstration Act of 1990).
            (6) Institution of higher education.--The term 
        ``institution of higher education'' has the meaning given the 
        term in section 2 of the Energy Policy Act of 2005 (42 U.S.C. 
        15801).
            (7) Nonroad vehicle.--The term ``nonroad vehicle'' means a 
        vehicle that is powered by a nonroad engine, as that term is 
        defined in section 216 of the Clean Air Act (42 U.S.C. 7550), 
        or fully or partially by an electric motor powered by a fuel 
        cell, a battery, or an off-board source of electricity and that 
        is not a motor vehicle or a vehicle used solely for 
        competition.
            (8) Plug-in hybrid electric vehicle.--The term ``plug-in 
        hybrid electric vehicle'' means a light-duty, medium-duty, or 
        heavy-duty on-road or nonroad vehicle that is propelled by an 
        internal combustion engine or heat engine and/or an electric 
        motor and energy storage system using--
                    (A) any combustible fuel;
                    (B) an on-board, rechargeable storage device; and
                    (C) a means of using an off-board source of 
                electricity to operate the vehicle in intermittent or 
                continuous all-electric mode.
            (9) Plug-in hybrid fuel cell vehicle.--The term ``plug-in 
        hybrid fuel cell vehicle'' means a fuel cell vehicle with an 
        on-board, rechargeable storage device powered by an off-board 
        source of electricity.
            (10) Secretary.--The term ``Secretary'' means the Secretary 
        of Energy.
    (c) Electric Drive Transportation Program.--
            (1) Research and development.--The Secretary shall conduct 
        a program of research, development, demonstration, and 
        commercial application for electric drive transportation 
        technology, including--
                    (A) high capacity, high efficiency batteries that 
                have improved battery life, energy storage capacity and 
                power delivery capacity when compared to technology 
                that is in commercial service;
                    (B) high efficiency on-board and off-board charging 
                components;
                    (C) high power and energy efficient drive train 
                systems for passenger and commercial vehicles and for 
                nonroad vehicles;
                    (D) control system development and power train 
                development and integration for plug-in hybrid electric 
                vehicles, plug-in hybrid fuel cell vehicles, and engine 
                dominant hybrid electric vehicles, including--
                            (i) development of efficient cooling 
                        systems;
                            (ii) analysis and development of control 
                        systems that minimize the emissions profile 
                        when clean diesel engines are part of a plug-in 
                        hybrid drive system; and
                            (iii) development of different control 
                        systems that optimize for different goals, 
                        including battery life, reduction of petroleum 
                        consumption, and greenhouse gas reduction;
                    (E) nanomaterial technology applied to both battery 
                and fuel cell systems; and
                    (F) smart vehicle and grid interconnection devices 
                and software that enable communications between the 
                grid of the future and electric drive vehicles
            (2) Market assessment and electricity usage.--The 
        Secretary, in consultation with the Administrator and with 
        industry, shall implement a program to--
                    (A) understand and inventory existing electric 
                drive technologies and markets;
                    (B) identify and implement methods of removing 
                barriers for existing and emerging applications of 
                electric drive transportation technologies;
                    (C) work with utilities to develop low-cost, simple 
                methods of utilizing off-peak electricity or managing 
                any on-peak electricity use;
                    (D) develop systems and processes to enable plug-in 
                hybrid vehicles to enhance the availability of 
                emergency back-up power for consumers and study and 
                demonstrate the potential value to the grid to utilize 
                the energy stored in the on-board storage systems to 
                improve the efficiency and reliability of the grid 
                generation system; and
                    (E) work with utilities and other interested 
                stakeholders to study and demonstration the linkages 
                and implications of the introduction of plug-in hybrids 
                and other types of electric transportation and the 
                production of electricity from renewable resources.
            (3) Grants to encourage off-peak electricity usage.--The 
        Secretary shall award grants to partially fund public and 
        private electric utility programs and technologies that 
        encourage owners of electric drive transportation technologies 
        to use off-peak electricity or have the load managed by the 
        utility.
            (4) Plug-in hybrid electric vehicle and electric drive 
        transportation testing and certification.--
                    (A) In general.--For purposes of enabling the 
                introduction of plug-in hybrid electric vehicles and 
                electric drive transportation technology into 
                commercial use, the Secretary shall develop, in 
                collaboration with industry and in consultation with 
                the Administrator, a program to test the emissions of 
                criteria pollutants, energy use and the petroleum 
                reduction potential of light-, medium-, and heavy-duty 
                plug-in hybrid electric vehicles and other forms of 
                electric drive transportation in both actual driving 
                and test conditions. The Secretary shall also cooperate 
                with the Administrator in the development of the 
                program described in subparagraph (B) to establish 
                certification standards for light-, medium- and heavy-
                duty plug-in hybrid electric vehicles.
                    (B) Testing program.--The testing program shall 
                consider the results of prior testing activities of the 
                public and private sectors, and shall utilize the 
                capabilities of the Department of Energy's Field 
                Operations Program and Qualified Vehicle Testing Sites. 
                Test procedures shall include consideration of--
                            (i) the vehicle and fuel as a system, not 
                        just an engine;
                            (ii) nightly off-board charging; and
                            (iii) different engine-turn on speed 
                        control strategies.
                    (C) Certification program.--Within 6 months of the 
                date of enactment of this section, the Administrator 
                shall develop a task force including vehicle 
                manufacturers, environmental organizations, utilities, 
                fleet operators, research organizations and 
                representatives of Federal agencies, including the 
                Department of Transportation and the Department of 
                Energy, to consider the establishment of minimum 
                certification standards for plug-in hybrid electric 
                vehicles.
                    (D) Duties.--The task force established under 
                subparagraph (C) shall--
                            (i) identify critical path issues in the 
                        establishment of a certification protocol;
                            (ii) identify criteria for the 
                        establishment of a plug-in hybrid certification 
                        protocol that would be applicable to various 
                        plug-in hybrid vehicle technologies and 
                        applications and vehicle control strategies;
                            (iii) evaluate test data available from 
                        hybrid vehicle test programs and fuel economy 
                        analysis;
                            (iv) work with the Administrator to develop 
                        guidelines to permit the emissions reductions 
                        attributable to the use of plug-in hybrid 
                        vehicles to be recognized for purposes of State 
                        Implementation Plans; and
                            (iv) recommend a certification protocol for 
                        certifying the emissions, fuel economy and 
                        petroleum usage of plug-in hybrid vehicles.
                    (E) Public comment.--Within 18 months of the date 
                of enactment of this section, the Administrator shall 
                publish the recommended certification protocol for 
                public comment.
                    (F) Final protocol.--Not later than two years after 
                the date of enactment of this section, the 
                Administrator shall publish a final certification 
                protocol for plug-in hybrid vehicles.
            (5) City cars.--Not later than 1 year after the date of 
        enactment of this section, the Secretary, in consultation with 
        the Secretary of Transportation, shall study and report to 
        Congress on the benefits, including petroleum savings, of and 
        barriers to the widespread deployment of a potentially new 
        class of vehicles known as city cars with performance 
        capability that exceeds that of low speed vehicles but is less 
        than that of passenger vehicles, and which may be battery 
        electric, fuel cell electric, or plug-in hybrid electric 
        vehicles. Such study shall examine and recommend appropriate 
        safety requirements for such vehicles based on patterns of 
        usage.
    (d) Plug-in Hybrid Electric Vehicle Demonstration Program.--
            (1) Establishment.--The Secretary shall establish a 
        competitive demonstration program to provide grants on a cost-
        shared basis to State governments, local governments, 
        metropolitan transportation authorities, air pollution control 
        districts, private or nonprofit entities or combinations 
        thereof, to carry out a project or projects for demonstration 
        of plug-in hybrid electric vehicles
            (2) Administration.--The Secretary shall establish 
        requirements for applications for grants under this section. 
        The Secretary shall require, at a minimum, that applicants 
        describe how data will be collected and summarized for 
        dissemination to the Department, other grantees and the public, 
        on--
                    (A) vehicle and component performance, including 
                performance of the battery, energy management, and 
                charging systems, under various driving speeds, trip 
                ranges, traffic and other driving conditions;
                    (B) vehicle and component costs, including 
                acquisition, operating and maintenance costs;
                    (C) vehicle emissions, including emissions of 
                greenhouse gases; and
                    (D) petroleum displacement as a result of the 
                project.
            (3) Solicitation.--Not later than 180 days after the date 
        of enactment of this section, the Secretary shall solicit 
        proposals to demonstrate plug-in hybrid electric vehicles. 
        Thereafter, the Secretary shall make annual solicitations for 
        proposals to carry out this section.
            (4) Selection criteria.--
                    (A) Priority.--When making awards under this 
                subsection, the Secretary shall consider each 
                applicant's previous experience involving plug-in 
                hybrid electric vehicles and shall give priority 
                consideration to applications that--
                            (i) demonstrate a path to commercialization 
                        for the vehicles demonstrated;
                            (ii) demonstrate technologies that optimize 
                        the performance of the vehicle in terms of 
                        miles per gallon and emission reduction in 
                        urban and suburban environments; or
                            (iii) are likely to make a significant 
                        contribution to the advancement of the 
                        technology and production in the United States.
                    (B) Scope of demonstrations.--When making awards 
                under this subsection, the Secretary shall ensure that 
                the program will--
                            (i) demonstrate the operation of plug-in 
                        hybrid vehicles under various driving speeds, 
                        trip ranges, driving conditions, climate 
                        conditions and topography conditions;
                            (ii) demonstrate light-, medium- and heavy-
                        duty vehicles with a variety of battery and 
                        engine-turn-on control systems;
                            (iii) demonstrate plug-in hybrid vehicles 
                        in a variety of applications including military 
                        applications, mass market passenger and light-
                        duty truck applications, and fleet 
                        applications;
                            (iv) demonstrate vehicles from original 
                        equipment manufacturers, Tier One suppliers, or 
                        other entities capable of achieving 
                        commercialization of the technology; and
                            (v) provide an opportunity for innovation 
                        and creativity from small and breakthrough 
                        technology companies.
            (5) Other requirements.--
                    (A) Continuing eligibility.--An applicant that has 
                received a grant in one year may apply for additional 
                funds in subsequent years, but the Secretary shall not 
                provide more than an aggregate of $20,000,000 in 
                Federal assistance under the program to any applicant 
                for fiscal years 2008 through 2013.
                    (B) Information.--The Secretary shall establish 
                mechanisms to ensure that nonproprietary information, 
                test data, specifications, and knowledge gained by 
                participants in the program are shared among the 
                program participants and available to other interested 
                parties, including other applicants.
    (e) Education Program.--The Secretary shall develop a nationwide 
education strategy for electric drive transportation technologies 
providing secondary and high school teaching materials and support for 
education offered by institutions of higher education that is focused 
on electric drive system and component engineering, including--
            (1) the Plug-In Hybrid Electric Vehicle competition for 
        institutions of higher education to be named in honor of the 
        pioneering work of Dr. Andrew Frank; and
            (2) a program to award funds to institutions of higher 
        education to create or support degree programs to ensure the 
        availability of trained electrical and mechanical engineers 
        with the skills necessary for the advancement of plug-in hybrid 
        electric vehicles and other forms of electric-drive 
        transportation.
    (f) Near-Term Electric Transportation Deployment Program.--
            (1) In general.--Not later than 1 year after the date of 
        enactment of this section, after consultation with the 
        Secretary and the Secretary of Transportation, the 
        Administrator shall establish a program of grants and loans to 
        deploy qualified electric transportation that can reduce 
        petroleum use, greenhouse gas emissions and criteria pollutants 
        by 40 percent or more when compared to commercially available, 
        nonelectric technologies.
            (2) Definition.--For purposes of this subsection, the term 
        ``qualified electric transportation project'' includes ship-to-
        shore electrification, truck stop electrification, electric 
        truck refrigeration units; electric airport ground support 
        equipment, electric material handing equipment, electric or 
        dual mode electric freight rail, and associated infrastructure, 
        including, but not limited to, panel upgrades, battery 
        chargers, and trenching.
            (3) Grants.--Two thirds of the funds made available by the 
        Administrator for grants to qualified electric transportation 
        projects shall be allocated competitively based on the overall 
        cost-effectiveness of the project in reducing emissions of 
        criteria pollutants, emissions of greenhouse gases, and 
        petroleum usage. One-third of the grant funds made available 
        shall be awarded to projects as applications are received as 
        long as the projects meet the minimum standard for the 
        reduction of 40 percent in emissions of criteria pollutants, 
        emissions of greenhouse gases and petroleum usage. Large scale 
        projects and large scale aggregators of projects are 
        encouraged.
            (4) Loans.--The Administrator shall establish a revolving 
        loan program to provide loans for qualified electric 
        transportation projects. Of funds appropriated to carry out the 
        purposes of this subsection, amounts not utilized for grants 
        under paragraph (3) shall be used to fund the loan program. The 
        Administrator shall establish criteria for loans under this 
        paragraph.
    (g) Transition to Fuel and Technology Neutral Regulations.--
            (1) Findings.--
                    (A) Congress finds that in light of advances in 
                automotive engine technologies since the passage of the 
                Clean Air Act, it is necessary to modify the control of 
                mobile source emissions pursuant to the Clean Air Act 
                to establish fuel and technology neutral mobile source 
                emissions control programs.
                    (B) Congress finds that replacement of current 
                emissions control requirements with a market-based 
                program that encourages the use of the most fuel 
                efficient and environmentally benign vehicles will 
                provide opportunities for all vehicle types, including 
                vehicles with spark-ignited engines, compression-
                ignited engines, other engine types, dual fueled 
                vehicles, flexible fuel vehicles, fuel cell electric 
                vehicles, battery electric vehicles, plug-in hybrid 
                electric vehicles, corded electric vehicle equipment 
                and other electric propulsion technologies.
            (2) Reports.--Within 1 year of the date of enactment of 
        this section, the Administrator shall report to Congress on all 
        of the fuel and technology-specific definitions in Federal 
        environmental law and regulations and recommend how such 
        definitions might be changed to be fuel and technology neutral. 
        Within 18 months of the date of enactment of this section, the 
        Administrator shall report to Congress on how petroleum 
        reductions, emissions reductions, and reductions in full fuel 
        cycle criteria pollutants could be incorporated into the fuel 
        and technology neutral emissions reduction program required 
        under paragraph (3).
            (3) Rulemaking.--After providing the report required under 
        paragraph (2), the Administrator shall, within 2 years of the 
        date of enactment of this section, adopt final rules to 
        implement a fuel and technology neutral program to reduce 
        tailpipe and evaporative emissions of criteria pollutants from 
        mobile sources. Such program shall take effect not later than 
        10 years after the date of enactment of this section.
            (4) Definition.--For purposes of this subsection, ``fuel 
        and technology neutral mobile source emissions control 
        programs'' means programs that contain minimum standards for 
        emissions of criteria pollutants from mobile sources and a 
        credit-based compliance mechanism for manufacturers that 
        includes averaging, banking and trading of credits for 
        exceeding the minimum standard.
    (h) Cost Sharing.--Notwithstanding section 988(c) of the Energy 
Policy Act of 2005 (42 U.S.C. 16352), the Secretary shall reduce to 30 
percent the non-Federal cost share required from local and municipal 
governments participating in the programs authorized in this section.
    (i) Merit Review.--Notwithstanding section 989 of the Energy Policy 
Act of 2005 (42 U.S.C. 16353), not more than 30 percent of the total 
funding awarded under this section shall be directly awarded to 
National Laboratories, not more than 10 percent of the total funding 
awarded under this section shall be awarded, directly or indirectly, to 
projects for the development. or demonstration of fuel cell vehicles or 
plug-in hybrid fuel cell vehicles, not more than 30 percent of the 
total funding awarded under subsection (f) shall be awarded, directly 
or indirectly, to ship-to-shore-electrification projects, and not more 
than 5 percent of the total funding awarded under this section shall be 
awarded, directly or indirectly, to projects for the development or 
demonstration of electric rail or magnetic levitation trains.
    (j) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out the programs under subsections (c) and (e) 
$110,000,000 for each of fiscal years 2008 through 2013. There are 
authorized to be appropriated to carry out the program under subsection 
(d) $60,000,000 for each of fiscal years 2008 through 2012, of which 
$20,000,000 shall be available only for award to local and municipal 
governments. There are authorized to be appropriated to carry out the 
programs under subsections (f) and (g) $125,000,000 for each of fiscal 
years 2008 through 2013.

SEC. 402. AMENDMENTS TO ALTERNATIVE MOTOR VEHICLE CREDIT.

    (a) 2002 Model Year City Fuel Economy.--Section 30B(c)(2)(A)(ii) of 
Subpart B of part IV of subchapter A of chapter 1 of the Internal 
Revenue Code of 1986 is amended to read as follows:
                            ``(ii) 2002 model year city fuel economy.--
                        For purposes of this section, the 2002 model 
                        year city fuel economy with respect to a 
                        vehicle shall be determined on a gasoline 
                        equivalent basis as determined by the 
                        Administrator of the Environmental Protection 
                        Agency using the tables provided in subsection 
                        (b)(2)(B) with respect to such vehicle, except 
                        that for purposes of subsection (d)(2)(A)(i) 
                        city fuel economy must not include fuel economy 
                        increases resulting from off-vehicle sources of 
                        electricity.''.
    (b) New Qualified Hybrid Motor Vehicle Credit.--Section 30B(d) of 
Subpart B of Part IV of subchapter A of chapter 1 of the Internal 
Revenue Code of 1986 is amended to read as follows:
    ``(d) New Qualified Hybrid Motor Vehicle Credit.--
            ``(1) In general.--For purposes of subsection (a), the new 
        qualified hybrid motor vehicle credit determined under this 
        subsection for the taxable year is the credit amount determined 
        under paragraph (2) with respect to a new qualified hybrid 
        motor vehicle placed in service by the taxpayer during the 
        taxable year.
            ``(2) Credit amount.--
                    ``(A) Credit amount for passenger automobiles and 
                light trucks.--
                            ``(i) in the case of a new qualified 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 clauses 
                        (ii), (iii), and (iv).
                            ``(ii) Fuel economy.--The amount determined 
                        under this clause is the amount which would be 
                        determined under subsection (c)(2)(A) if such 
                        vehicle were a vehicle referred to in such 
                        subsection.
                            ``(iii) Conservation credit.--The amount 
                        determined under this clause is the amount 
                        which would be determined under subsection 
                        (c)(2)(B) if such vehicle were a vehicle 
                        referred to in such subsection.
                            ``(iv) Increase for battery-powered range 
                        from off-vehicle electricity.--The amount 
                        determined under this clause in 2009 to 2015 as 
                        follows:
                                    ``(I) $800 if such vehicle uses a 4 
                                kWh traction battery.
                                    ``(II) $1200 if such vehicle uses a 
                                5 kWh traction battery.
                                    ``(III) $1600 if such vehicle uses 
                                a 6 kWh traction battery.
                                    ``(IV) $2000 if such vehicle uses a 
                                7 kWh traction battery.
                                    ``(V) $2400 if such vehicle uses a 
                                8 kWh traction battery.
                                    ``(VI) $2800 if such vehicle uses a 
                                9 kWh traction battery.
                                    ``(VII) $3000 if such vehicle uses 
                                a 10 kWh traction battery.
                                    ``(VIII) $3200 if such vehicle uses 
                                a 11 kWh traction battery.
                                    ``(IX) $3400 if such vehicle uses a 
                                12 kWh traction battery.
                                    ``(X) $3800 if such vehicle uses a 
                                13 kWh traction battery.
                                    ``(XI) $4000 if such vehicle uses a 
                                14 kWh traction battery.
                                    ``(XII) $4200 if such vehicle uses 
                                a 15 kWh traction battery.
                    ``(B) Credit amount for other motor vehicles.--
                            ``(i) In general.--In the case of any new 
                        qualified hybrid motor vehicle to which 
                        subparagraph (A) does not apply, the amount 
                        determined under this paragraph is the amount 
                        equal to the applicable percentage of the 
                        qualified incremental hybrid cost of the 
                        vehicle as certified under clause (v).
                            ``(ii) Applicable percentage.--For purposes 
                        of clause (i), the applicable percentage is--
                                    ``(I) 20 percent if the vehicle 
                                achieves an increase in city fuel 
                                economy relative to a comparable 
                                vehicle of at least 30 percent but less 
                                than 40 percent,
                                    ``(II) 30 percent if the vehicle 
                                achieves such an increase of at least 
                                40 percent but less than 50 percent,
                                    ``(III) 40 percent if the vehicle 
                                achieves such an increase of at least 
                                50 percent, and
                                    ``(IV) 40 percent for a plug-in 
                                hybrid electric vehicle that can use 
                                off-board electricity to recharge an 
                                energy storage device capable of ten 
                                (or greater) miles of all electric 
                                range.
                        More than 40 percent shall be granted if the 
                        all electric range is greater than 10 miles, as 
                        determined by the Administrator of the 
                        Environmental Protection Agency.
                            ``(iii) Qualified incremental hybrid 
                        cost.--For purposes of this subparagraph, the 
                        qualified incremental hybrid cost of any 
                        vehicle is equal to the amount of the excess of 
                        the manufacturer's suggested retail price for 
                        such vehicle over such price for a comparable 
                        vehicle, to the extent such amount does not 
                        exceed--
                                    ``(I) $7,500, if such vehicle has a 
                                gross vehicle weight rating of not more 
                                than 14,000 pounds,
                                    ``(II) $15,000, if such vehicle has 
                                a gross vehicle weight rating of more 
                                than 14,000 pounds but not more than 
                                26,000 pounds, and
                                    ``(III) $30,000, if such vehicle 
                                has a gross vehicle weight rating of 
                                more than 26,000 pounds.
                            ``(iv) Comparable vehicle.--For purposes of 
                        this subparagraph, the term `comparable 
                        vehicle' means, with respect to any new 
                        qualified hybrid motor vehicle, any vehicle 
                        which is powered solely by a gasoline or diesel 
                        internal combustion engine and which is 
                        comparable in weight, size, and use to such 
                        vehicle.
                            ``(v) Certification.--A certification 
                        described in clause (i) shall be made by the 
                        manufacturer and shall be determined in 
                        accordance with guidance prescribed by the 
                        Secretary. Such guidance shall specify 
                        procedures and methods for calculating fuel 
                        economy savings and incremental hybrid costs.
            ``(3) New qualified hybrid motor vehicle.--For purposes of 
        this subsection--
                    ``(A) In general.--The term `new qualified hybrid 
                motor vehicle' means a motor vehicle--
                            ``(i) which draws propulsion energy from 
                        onboard sources of stored energy which are 
                        both--
                                    ``(I) an internal combustion or 
                                heat engine using consumable fuel, and
                                    ``(II) a rechargeable energy 
                                storage system,
                            ``(ii) which, in the case of a vehicle to 
                        which paragraph (2)(A) applies, has received a 
                        certificate of conformity under the Clean Air 
                        Act and meets or exceeds the equivalent 
                        qualifying California low emission vehicle 
                        standard under section 243(e)(2) of the Clean 
                        Air Act for that make and model year, and--
                                    ``(I) in the case of a vehicle 
                                having a gross vehicle weight rating of 
                                6,000 pounds or less, 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, and
                                    ``(II) in the case of a vehicle 
                                having a gross vehicle weight rating of 
                                more than 6,000 pounds but not more 
                                than 8,500 pounds, the Bin 8 Tier II 
                                emission standard which is so 
                                established,
                            ``(iii) which has a maximum available power 
                        of at least--
                                    ``(I) 4 percent in the case of a 
                                vehicle to which paragraph (2)(A) 
                                applies,
                                    ``(II) 10 percent in the case of a 
                                vehicle which has a gross vehicle 
                                weight rating of more than 8,500 pounds 
                                and not more than 14,000 pounds, and
                                    ``(III) 15 percent in the case of a 
                                vehicle in excess of 14,000 pounds,
                            ``(iv) which, in the case of a vehicle to 
                        which paragraph (2)(B) applies, has an internal 
                        combustion or heat engine which has received a 
                        certificate of conformity under the Clean Air 
                        Act as meeting the emission standards set in 
                        the regulations prescribed by the Administrator 
                        of the Environmental Protection Agency for 2004 
                        through 2007 model year diesel heavy duty 
                        engines or Otto cycle heavy duty engines, as 
                        applicable,
                            ``(v) the original use of which commences 
                        with the taxpayer,
                            ``(vi) which is acquired for use or lease 
                        by the taxpayer and not for resale, and
                            ``(vii) which is made by a manufacturer.
                            ``(viii) which includes plug-in hybrid 
                        electric vehicles for purposes of paragraphs 
                        (2)(A) and (2)(B).
                Such term shall not include any vehicle which is not a 
                passenger automobile or light truck if such vehicle has 
                a gross vehicle weight rating of less than 8,500 
                pounds.
                    ``(B) Consumable fuel.--For purposes of 
                subparagraph (A)(i)(I), the term `consumable fuel' 
                means any solid, liquid, or gaseous matter which 
                releases energy when consumed by an auxiliary power 
                unit.
                    ``(C) Maximum available power.--
                            ``(i) Certain passenger automobiles and 
                        light trucks.--In the case of a vehicle to 
                        which paragraph (2)(A) applies, the term 
                        `maximum available power' means the maximum 
                        power available from the rechargeable energy 
                        storage system, during a standard 10 second 
                        pulse power or equivalent test, divided by such 
                        maximum power and the SAE net power of the heat 
                        engine.
                            ``(ii) Other motor vehicles.--In the case 
                        of a vehicle to which paragraph (2)(B) applies, 
                        the term `maximum available power' means the 
                        maximum power available from the rechargeable 
                        energy storage system, during a standard 10 
                        second pulse power or equivalent test, divided 
                        by the vehicle's total traction power. For 
                        purposes of the preceding sentence, the term 
                        `total traction power' means the sum of the 
                        peak power from the rechargeable energy storage 
                        system and the heat engine peak power of the 
                        vehicle, except that if such storage system is 
                        the sole means by which the vehicle can be 
                        driven, the total traction power is the peak 
                        power of such storage system.
                    ``(D) All electric range.--For purposes of 
                paragraph (2)(B) the term `all electric range' means 
                miles traveled in a hybrid electric vehicle capable of 
                using an off-vehicle source of electricity and tested 
                using the Environmental Protection Agency's Federal 
                Urban Driving Schedule or a new driving schedule for 
                plug-in hybrid electric vehicles.
                    ``(E) KWH traction battery.--For purposes of 
                paragraph (2)(A)(iii) the term `kWh traction battery' 
                means the size of an electrochemical storage device as 
                measured by from 100 percent state of charge to 0 
                percent state of charge as defined at [10 C.F.R. 
                _____].
                    ``(F) Plug-in hybrid electric vehicle.--For 
                purposes of paragraphs (2)(A) and (2)(B), the term 
                `plug-in hybrid electric vehicle' means a light-duty, 
                medium-duty, or heavy-duty on-road or vehicle that is 
                propelled by an internal combustion engine or heat 
                engine and/or an electric motor and energy storage 
                system using:
                            ``(i) any combustible fuel,
                            ``(ii) an on-board, rechargeable storage 
                        device, and
                            ``(iii) a means of using an off-board 
                        source of electricity to operate the vehicle in 
                        intermittent or continuous all-electric 
                        mode.''.
    (c) Driving Schedule for Plug-in Hybrid Electric Vehicles.--
            (1) Establishment.--Not later than 18 months after the date 
        of enactment of this section, the Administrator of the 
        Environmental Protection Agency shall develop a driving 
        schedule for plug-in hybrid electric vehicles based on a test 
        that shall start with a full battery and end when the battery 
        reaches 20 percent state of charge after intermittent use of 
        the battery and electric motor for vehicle propulsion at speeds 
        no greater than 35 miles per hour, and which does not count 
        vehicle miles traveled while the engine is operating.
            (2) Bonus credits.--Vehicles that can travel in all 
        electric mode during a separate test of higher speed operation 
        shall be entitled to bonus all electric range miles for 
        purposes of the credit provided in Section 30B of the Internal 
        Revenue Code of 1986, on a schedule to be established by rule 
        by the Administrator.
    (d) Duration of Tax Credit.--Section 30B(i) of the Internal Revenue 
Code of 1986, as amended by this Act, is amended to read as follows:
    ``(i) Termination.--This section shall not apply to any property 
purchased after--
            ``(1) in the case of a new qualified fuel cell motor 
        vehicle (as described in subsection (b)), December 31, 2014,
            ``(2) in the case of a new advanced lean burn technology 
        motor vehicle (as described in subsection (c)) or a new 
        qualified hybrid motor vehicle (as described in subsection 
        (d)(2)(A)), December 31, 2010,
            ``(3) in the case of a new qualified hybrid motor vehicle 
        (as described in subsection (d)(2)(B)), December 31, 2010,
            ``(4) in the case of a new qualified alternative fuel 
        vehicle (as described in subsection (e)), December 31, 2010, 
        and
            ``(5) in the case of a new qualified hybrid motor vehicle 
        which is a plug-in hybrid electric vehicle range (as described 
        in subsection (d)(2)(A) and (d) (2) (B), December 31, 2015.''.
    (e) Effective Date.--The amendments made by this section shall take 
effect for property or vehicles placed in service after December 31, 
2008.

SEC. 403. IDLING REDUCTION TAX 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. 45O. IDLING REDUCTION CREDIT.

    ``(a) General Rule.--For purposes of section 38, the idling 
reduction tax credit determined under this section for the taxable year 
is an amount equal to 50 percent of the amount paid or incurred for the 
purchase and installation of each qualifying idling reduction device or 
qualifying idle reduction infrastructure placed in service by the 
taxpayer during the taxable year.
    ``(b) Limitation.--The maximum amount allowed as a credit under 
subsection (a) shall not exceed $3,500 per device or per qualifying 
infrastructure.
    ``(c) Definitions.--For purposes of subsection (a)--
            ``(1) Qualifying idling reduction device.--The term 
        `qualifying idling reduction device' means any device or system 
        of devices that--
                    ``(A) is installed on a heavy-duty diesel-powered 
                on-highway vehicle,
                    ``(B) is designed to provide to such vehicle those 
                services (such as heat, air conditioning, or 
                electricity) that would otherwise require the operation 
                of the main drive engine while the vehicle is 
                temporarily parked or remains stationary using either--
                            ``(i) an all electric unit such as a 
                        battery powered unit or from grid-supplied 
                        electricity, or
                            ``(ii) a dual fuel unit powered by diesel 
                        or other fuels, and is capable of providing 
                        such services from grid-supplied electricity or 
                        on-truck batteries alone,
                    ``(C) the original use of which commences with the 
                taxpayer,
                    ``(D) is acquired for use by the taxpayer and not 
                for resale, and
                    ``(E) is certified by the Secretary of Energy, in 
                consultation with the Administrator of the 
                Environmental Protection Agency and the Secretary of 
                Transportation, to reduce long-duration idling of such 
                vehicle at a motor vehicle rest stop or other location 
                where such vehicles are temporarily parked or remain 
                stationary.
            ``(2) Heavy-duty diesel-powered on-highway vehicle.--The 
        term `heavy-duty diesel-powered on-highway vehicle' means any 
        vehicle, machine, tractor, trailer, or semi-trailer propelled 
        or drawn by mechanical power and used upon the highways in the 
        transportation of passengers or property, or any combination 
        thereof determined by the Federal Highway Administration.
            ``(3) Long-duration idling.--The term `long-duration 
        idling' means the operation of a main drive engine, for a 
        period greater than 15 consecutive minutes, where the main 
        drive engine is not engaged in gear. Such term does not apply 
        to routine stoppages associated with traffic movement or 
        congestion.
            ``(4) Qualifying idle reduction infrastructure.--The term 
        `qualifying idle reduction infrastructure' means either --
                    ``(A) off-truck equipment to supply electric power, 
                including electric receptacles, boxes, wiring, conduit, 
                and other connections to one truck space, or
                    ``(B) off-truck equipment that directly provides 
                air conditioning, heating, electric power, and other 
                connections and services to one truck space.
    ``(d) No Double Benefit.--For purposes of this section--
            ``(1) Reduction in basis.--If a credit is determined under 
        this section with respect to any property by reason of 
        expenditures described in subsection (a), the basis of such 
        property shall be reduced by the amount of the credit so 
        determined.
            ``(2) Other deductions and credits.--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.
            ``(3) Election not to claim credit.--This section shall not 
        apply to a taxpayer for any taxable year if such taxpayer 
        elects to have this section not apply for such taxable year.''.
    (b) Credit to Be Part of General Business Credit.--Subsection (b) 
of section 38 of such Code (relating to general business credit) is 
amended by striking ``plus'' at the end of paragraph (30), by striking 
the period at the end of paragraph (31) and inserting ``, plus'' , and 
by adding at the end the following new paragraph:
            ``(32) the idling reduction tax credit determined under 
        section 45O(a).''.
    (c) Conforming Amendments.--
            (1) The table of sections for subpart D of part IV of 
        subchapter A of chapter 1 of such Code is amended by inserting 
        after the item relating to section 45M the following new item:

``Sec. 45O. Idling reduction credit.''.
            (2) Section 1016(a) of such Code, as amended by this Act, 
        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:
            ``(39) in the case of a facility with respect to which a 
        credit was allowed under section 45O, to the extent provided in 
        section 45O(d)(A).''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2006.
    (e) Determination of Certification Standards by Secretary of Energy 
for Certifying Idling Reduction Devices.--Not later than 6 months after 
the date of the enactment of this section and in order to reduce air 
pollution and fuel consumption, the Secretary of Energy, in 
consultation with the Administrator of the Environmental Protection 
Agency and the Secretary of Transportation, shall publish the standards 
under which the Secretary, in consultation with the Administrator of 
the Environmental Protection Agency and the Secretary of 
Transportation, will, for purposes of section 45O of the Internal 
Revenue Code of 1986 (as added by this section), certify the idling 
reduction devices and qualifying infrastructure which will reduce long-
duration idling of vehicles at motor vehicle rest stops or other 
locations where such vehicles are temporarily parked or remain 
stationary in order to reduce air pollution and fuel consumption.

SEC. 404. PLUG-IN HYBRID ELECTRIC VEHICLE PRIZE.

    (a) In General.--The Secretary of Energy (in this section referred 
to as the ``Secretary'') shall carry out a program to competitively 
award cash prizes to advance the research, development, demonstration, 
and commercial application of plug-in hybrid electric vehicle 
technology.
    (b) Categories.--The Secretary shall establish prizes for--
            (1) batteries using nanotechnology for application in plug-
        in hybrid electric vehicles or in plug-in hybrid fuel cell 
        vehicles;
            (2) prototypes of plug-in hybrid electric vehicles that 
        best meet or exceed objective performance criteria;
            (3) demonstrations of prototypes of plug-in hybrid electric 
        vehicles in medium duty, heavy-duty, nonroad vehicle or 
        military applications that are designed to facilitate the 
        eventual market success of plug-in hybrid electric vehicle 
        technologies;
            (4) advancements in plug-in hybrid electric vehicle 
        technology for light-duty passenger vehicle applications that 
        can significantly advance the petroleum reduction and 
        environmental benefits or control system technology;
            (5) advancements in plug-in hybrid electric vehicles 
        technology for light-duty passenger applications to obtain at 
        least 30 miles of continuous all electric range at highway 
        speeds, to seat two or more passengers, to use four or more 
        wheels, to demonstrate zero to 60 mile per hour acceleration in 
        10 seconds or less, to meet Environmental Protection Agency 
        criteria pollutant standards, and to be able to pass safety 
        standards for passenger vehicles set by the National Highway 
        Transportation Safety Administration; and
            (6) other plug-in hybrid electric vehicle technology 
        advances deemed necessary by the Secretary.
    (c) Advancements.--Prizes authorized under this section shall be 
awarded to the most significant advance or advances that meet criteria 
established by the Secretary.
    (d) Eligibility.--To be eligible to win a prize under this section, 
an individual or entity--
            (1) shall have complied with all the requirements 
        prescribed by the Secretary;
            (2) in the case of a private entity, shall be incorporated 
        in and maintain a primary place of business in the United 
        States, and in the case of an individual, whether participating 
        singly or in a group, shall be a citizen of, or an alien 
        lawfully admitted for permanent residence in, the United 
        States; and
            (3) shall not be a Federal entity, a Federal employee 
        acting within the scope of his employment, or an employee of a 
        National Laboratory acting within the scope of his employment.
    (e) Judges.--The Secretary shall assemble a panel of qualified 
judges to select the winner or winners on the basis of the criteria 
established under subsection (c). Judges for each prize competition 
shall include individuals from outside the Department of Energy, 
including from the private sector. A judge may not--
            (1) have personal or financial interests in, or be an 
        employee, officer, director, or agent of, any entity that is a 
        registered participant in the prize competition for which he or 
        she will serve as a judge; or
            (2) have a familial or financial relationship with an 
        individual who is a registered participant in the prize 
        competition for which he or she will serve as a judge.
    (f) Nonsubstitution.--The program created under this section shall 
not be considered a substitute for Federal research and development 
programs.
    (g) Authorization of Appropriations.--There are authorized to be 
appropriated to the Secretary for carrying out this section $50,000,000 
for each of the fiscal years 2008 through 2011, of which no more than 
$1,000,000 for any fiscal year may be used for administrative expenses. 
Funds appropriated pursuant to this subsection shall remain available 
until expended.
    (h) Sunset.--The authority to announce prize competitions under 
this section shall terminate on September 30, 2017.
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