[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6899 Engrossed in House (EH)]

  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
110th CONGRESS
  2d Session
                                H. R. 6899

_______________________________________________________________________

                                 AN ACT


 
  To advance the national security interests of the United States by 
reducing its dependency on oil through renewable and clean, alternative 
    fuel technologies while building a bridge to the future through 
expanded access to Federal oil and natural gas resources, revising the 
relationship between the oil and gas industry and the consumers who own 
   those resources and deserve a fair return from the development of 
publicly owned oil and gas, ending tax subsidies for large oil and gas 
   companies, and facilitating energy efficiencies in the building, 
      housing, and transportation sectors, 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.

    This Act may be cited as the ``Comprehensive American Energy 
Security and Consumer Protection Act''.

SEC. 2. TABLE OF CONTENTS.

    The table of contents for this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.
                  TITLE I--FEDERAL OIL AND GAS LEASING

        Subtitle A--Outer Continental Shelf Oil and Gas Leasing

Sec. 101. Prohibition on leasing.
Sec. 102. Opening of certain areas to oil and gas leasing.
Sec. 103. Coastal State roles and responsibilities.
Sec. 104. Protection of the environment and conservation of the natural 
                            resources of the Outer Continental Shelf.
Sec. 105. Limitations.
Sec. 106. Prohibition on leasing in certain Federal protected areas.
Sec. 107. No effect on applicable law.
Sec. 108. Buy American requirements.
Sec. 109. Small, woman-owned, and minority-owned businesses.
Sec. 110. Definitions.
     Subtitle B--Diligent Development of Federal Oil and Gas Leases

Sec. 121. Clarification.
Sec. 122. Covered provisions.
Sec. 123. Regulations.
Sec. 124. Resource estimates and leasing program management indicators.
        Subtitle C--Royalties Under Offshore Oil and Gas Leases

Sec. 131. Short title.
Sec. 132. Price thresholds for royalty suspension provisions.
Sec. 133. Clarification of authority to impose price thresholds for 
                            certain lease sales.
Sec. 134. Eligibility for new leases and the transfer of leases; 
                            conservation of resources fees.
Sec. 135. Strategic Energy Efficiency and Renewables Reserve.
 Subtitle D--Accountability and Integrity in the Federal Energy Program

Sec. 141. Royalty in-kind.
Sec. 142. Fair return on production of Federal oil and gas resources.
Sec. 143. Royalty-in-kind ethics.
Sec. 144. Prohibition on certain gifts.
Sec. 145. Strengthening the ability of the Interior Department 
                            Inspector General to secure cooperation.
             Subtitle E--Federal Oil and Gas Royalty Reform

Sec. 151. Amendments to definitions.
Sec. 152. Interest.
Sec. 153. Obligation period.
Sec. 154. Tolling agreements and subpoenas.
Sec. 155. Liability for royalty payments.
            Subtitle F--National Petroleum Reserve in Alaska

Sec. 161. Short title.
Sec. 162. Acceleration of lease sales for National Petroleum Reserve in 
                            Alaska.
Sec. 163. National Petroleum Reserve in Alaska: pipeline construction.
Sec. 164. Alaska natural gas pipeline project facilitation.
Sec. 165. Project labor agreements and other pipeline requirements.
Sec. 166. Ban on export of Alaskan oil.
                         Subtitle G--Oil Shale

Sec. 171. Oil shale leasing.
                    TITLE II--CONSUMER ENERGY SUPPLY

Sec. 201. Short title.
Sec. 202. Definitions.
Sec. 203. Sale and replacement of oil from the Strategic Petroleum 
                            Reserve.
                    TITLE III--PUBLIC TRANSPORTATION

Sec. 301. Short title.
Sec. 302. Findings.
Sec. 303. Grants to improve public transportation services.
Sec. 304. Increased Federal share for Clean Air Act compliance.
Sec. 305. Transportation fringe benefits.
Sec. 306. Capital cost of contracting vanpool pilot program.
Sec. 307. National consumer awareness program.
Sec. 308. Exception to alternative fuel procurement requirement.
         TITLE IV--GREATER ENERGY EFFICIENCY IN BUILDING CODES

Sec. 401. Greater energy efficiency in building codes.
            TITLE V--FEDERAL RENEWABLE ELECTRICITY STANDARD

Sec. 501. Federal renewable electricity standard.
      TITLE VI--GREEN RESOURCES FOR ENERGY EFFICIENT NEIGHBORHOODS

Sec. 601. Short title and table of contents.
Sec. 602. Definitions.
Sec. 603. Implementation of energy efficiency participation incentives 
                            for HUD programs.
Sec. 604. Minimum HUD energy efficiency standards and standards for 
                            additional credit.
Sec. 605. Energy efficiency and conservation demonstration program for 
                            multifamily housing projects assisted with 
                            project-based rental assistance.
Sec. 606. Additional credit for Fannie Mae and Freddie Mac housing 
                            goals for energy efficient mortgages.
Sec. 607. Duty to serve underserved markets for energy-efficient and 
                            location-efficient mortgages.
Sec. 608. Consideration of energy efficiency under FHA mortgage 
                            insurance programs and Native American and 
                            Native Hawaiian loan guarantee programs.
Sec. 609. Energy efficient mortgages education and outreach campaign.
Sec. 610. Collection of information on energy-efficient and location 
                            efficient mortgages through Home Mortgage 
                            Disclosure Act.
Sec. 611. Ensuring availability of homeowners insurance for homes not 
                            connected to electricity grid.
Sec. 612. Mortgage incentives for energy-efficient multifamily housing.
Sec. 613. Energy efficiency certifications for housing with mortgages 
                            insured by FHA.
Sec. 614. Assisted housing energy loan pilot program.
Sec. 615. Residential energy efficiency block grant program.
Sec. 616. Including sustainable development in comprehensive housing 
                            affordability strategies.
Sec. 617. Grant program to increase sustainable low-income community 
                            development capacity.
Sec. 618. Utilization of energy performance contracts in HOPE VI.
Sec. 619. HOPE VI green developments requirement.
Sec. 620. Consideration of energy-efficiency improvements in 
                            appraisals.
Sec. 621. Assistance for Housing Assistance Council.
Sec. 622. Rural housing and economic development assistance.
Sec. 623. Loans to States and Indian tribes to carry out renewable 
                            energy sources activities.
Sec. 624. Green banking centers.
Sec. 625. Public housing energy cost report.
                  TITLE VII--MISCELLANEOUS PROVISIONS

Sec. 701. Alternative fuel pumps.
Sec. 702. National Energy Center of Excellence.
Sec. 703. Sense of Congress regarding renewable biomass.
                   TITLE VIII--ENERGY TAX INCENTIVES

Sec. 800. Short title, etc.
                Subtitle A--Energy Production Incentives

                  Part 1--Renewable Energy Incentives

Sec. 801. Renewable energy credit.
Sec. 802. Production credit for electricity produced from marine 
                            renewables.
Sec. 803. Energy credit.
Sec. 804. Credit for residential energy efficient property.
Sec. 805. Special rule to implement FERC and State electric 
                            restructuring policy.
Sec. 806. New clean renewable energy bonds.
                  Part 2--Carbon Mitigation Provisions

Sec. 811. Expansion and modification of advanced coal project 
                            investment credit.
Sec. 812. Expansion and modification of coal gasification investment 
                            credit.
Sec. 813. Temporary increase in coal excise tax.
Sec. 814. Special rules for refund of the coal excise tax to certain 
                            coal producers and exporters.
Sec. 815. Carbon audit of the tax code.
    Subtitle B--Transportation and Domestic Fuel Security Provisions

Sec. 821. Inclusion of cellulosic biofuel in bonus depreciation for 
                            biomass ethanol plant property.
Sec. 822. Credits for biodiesel and renewable diesel.
Sec. 823. Clarification that credits for fuel are designed to provide 
                            an incentive for United States production.
Sec. 824. Credit for new qualified plug-in electric drive motor 
                            vehicles.
Sec. 825. Exclusion from heavy truck tax for idling reduction units and 
                            advanced insulation.
Sec. 826. Restructuring of New York Liberty Zone tax credits.
Sec. 827. Transportation fringe benefit to bicycle commuters.
Sec. 828. Alternative fuel vehicle refueling property credit.
Sec. 829. Energy security bonds.
Sec. 830. Certain income and gains relating to alcohol fuels and 
                            mixtures, biodiesel fuels and mixtures, and 
                            alternative fuels and mixtures treated as 
                            qualifying income for publicly traded 
                            partnerships.
       Subtitle C--Energy Conservation and Efficiency Provisions

Sec. 841. Qualified energy conservation bonds.
Sec. 842. Credit for nonbusiness energy property.
Sec. 843. Energy efficient commercial buildings deduction.
Sec. 844. Modifications of energy efficient appliance credit for 
                            appliances produced after 2007.
Sec. 845. Accelerated recovery period for depreciation of smart meters 
                            and smart grid systems.
Sec. 846. Qualified green building and sustainable design projects.
                     Subtitle D--Revenue Provisions

Sec. 851. Limitation of deduction for income attributable to domestic 
                            production of oil, gas, or primary products 
                            thereof.
Sec. 852. Clarification of determination of foreign oil and gas 
                            extraction income.
Sec. 853. Time for payment of corporate estimated taxes.

                  TITLE I--FEDERAL OIL AND GAS LEASING

        Subtitle A--Outer Continental Shelf Oil and Gas Leasing

SEC. 101. PROHIBITION ON LEASING.

    (a) Prohibition.--The Outer Continental Shelf Lands Act (43 U.S.C. 
1331 et seq.) notwithstanding, the Secretary shall not take nor 
authorize any action related to oil and gas preleasing or leasing of 
any area of the Outer Continental Shelf that was not available for oil 
and gas leasing as of July 1, 2008, unless that action is expressly 
authorized by this subtitle or a statute enacted by Congress after the 
date of enactment of this Act.
    (b) Treatment of Areas in Gulf of Mexico.--For purposes of this 
subtitle, such action with respect to an area referred to in section 
104(a) of the Gulf of Mexico Energy Security Act of 2006 (title I of 
division C of Public Law 109-432; 42 U.S.C. 1331 note) taken or 
authorized after the period referred to in that section shall be 
treated as authorized by this subtitle, and such leasing of such area 
shall be treated as authorized under section 102(a).

SEC. 102. OPENING OF CERTAIN AREAS TO OIL AND GAS LEASING.

    (a) Leasing Authorized.--The Secretary may offer for oil and gas 
leasing, preleasing, or other related activities, in accordance with 
this section and the Outer Continental Shelf Lands Act (43 U.S.C. 1331 
et seq.) and subject to subsection (b) of this section, section 103 of 
this Act, and section 307 of the Coastal Zone Management Act of 1972 
(16 U.S.C. 1456), any area--
            (1) that is in any Outer Continental Shelf Planning Area in 
        the Atlantic Ocean or Pacific Ocean that is located farther 
        than 50 miles from the coastline; and
            (2) that was not otherwise available for oil and gas 
        leasing, preleasing, and other related activities as of July 1, 
        2008.
    (b) Inclusion in Leasing Program Required.--An area may be offered 
for lease under this section only if it has been included in an Outer 
Continental Shelf leasing program approved by the Secretary in 
accordance with section 18 of the Outer Continental Shelf Lands Act (43 
U.S.C. 1344).
    (c) Requirement To Conduct Lease Sales.--As soon as practicable, 
consistent with subsection (b) and section 103(a), but not later than 3 
years after the date of enactment of this Act, and as appropriate 
thereafter, the Secretary shall conduct oil and gas lease sales under 
the Outer Continental Shelf lands Act (43 U.S.C. 1331 et seq.) for 
areas that are made available for leasing by this section.

SEC. 103. COASTAL STATE ROLES AND RESPONSIBILITIES.

    (a) State Approval of Certain Leasing Required.--The Secretary may 
not conduct any oil and gas leasing or preleasing activity in any area 
made available for oil and gas leasing by section 102(a) that is 
located within 100 miles from the coastline and within the seaward 
lateral boundaries of an adjacent State, unless the adjacent State has 
enacted a law approving of the issuance of such leasing by the 
Secretary.
    (b) Consultation With Adjacent and Neighboring States.--
            (1) In general.--In addition to the consultation provided 
        for under section 19 of the Outer Continental Shelf Lands Act 
        (43 U.S.C. 1345), the Governor of a State that has a coastline 
        within 100 miles of an area of the Outer Continental Shelf 
        being considered for oil and gas leasing and made available for 
        such leasing by section 102(a) may submit recommendations to 
        the Secretary with respect to--
                    (A) the size, timing, or location of a proposed 
                lease sale; or
                    (B) a proposed development and production plan.
            (2) Requirements.--Subsections (b), (c), and (d) of section 
        19 of the Outer Continental Shelf Lands Act (43 U.S.C. 1345) 
        shall apply to the recommendations provided for in paragraph 
        (1).

SEC. 104. PROTECTION OF THE ENVIRONMENT AND CONSERVATION OF THE NATURAL 
              RESOURCES OF THE OUTER CONTINENTAL SHELF.

    The Secretary--
            (1) shall ensure that any activity under this subtitle is 
        carried out in a manner that provides for the protection of the 
        coastal environment, marine environment, and human environment 
        of State coastal zones and the Outer Continental Shelf; and
            (2) shall review all Federal regulations that are otherwise 
        applicable to activities authorized by this subtitle to ensure 
        environmentally sound oil and gas operations on the Outer 
        Continental Shelf.

SEC. 105. LIMITATIONS.

    (a) Compliance With Memorandum.--Any oil and gas leasing of areas 
of the Outer Continental Shelf shall be conducted in accordance with 
the document entitled ``Memorandum of Agreement between the Department 
of Defense and the Department of the Interior on Mutual Concerns On The 
Outer Continental Shelf'' and dated July 2, 1983, and such revisions 
thereto as may be agreed to by the Secretary of Defense and the 
Secretary of the Interior; except that no such revisions may be made 
prior to January 21, 2009.
    (b) National Security.--Notwithstanding subsection (a), the United 
States reserves the right to designate by and through the Secretary of 
Defense, with the approval of the President, national defense areas on 
the Outer Continental Shelf pursuant to section 12(d) of the Outer 
Continental Shelf Lands Act (43 U.S.C. 1341(d)).

SEC. 106. PROHIBITION ON LEASING IN CERTAIN FEDERAL PROTECTED AREAS.

    (a) In General.--Notwithstanding any other provision of this or any 
other Federal law, no lease or other authorization may be issued by the 
Federal Government that authorizes exploration, development, or 
production of oil or natural gas in--
            (1) any marine national monument or national marine 
        sanctuary; or
            (2) the fishing grounds known as Georges Bank in the waters 
        of the United States, which is one of the largest and 
        historically important fishing grounds of the United States.
    (b) Identification of Coordinates of Georges Bank.--The Secretary 
of Commerce, after publication of public notice and an opportunity for 
public comment, shall identify the specific coordinates that delineate 
Georges Bank in the waters of the United States for purposes of 
subsection (a).

SEC. 107. NO EFFECT ON APPLICABLE LAW.

    Except as otherwise specifically provided in this subtitle, nothing 
in this subtitle waives or modifies any applicable environmental or 
other law.

SEC. 108. BUY AMERICAN REQUIREMENTS.

    (a) In General.--It is the intent of Congress that this Act, among 
other things, result in a healthy and growing American industrial, 
manufacturing, transportation, and service sector employing the vast 
talents of America's workforce to assist in the development of energy 
from domestic sources. Moreover, the Congress intends to monitor the 
deployment of personnel and material onshore and offshore to encourage 
the development of American technology and manufacturing to enable 
United States workers to benefit from this Act by good jobs and 
careers, as well as the establishment of important industrial 
facilities to support expanded access to American resources.
    (b) Safeguard for Extraordinary Ability.--Section 30(a) of the 
Outer Continental Shelf Lands Act (43 U.S.C. 1356(a)) is amended in the 
matter preceding paragraph (1) by striking ``regulations which'' and 
inserting ``regulations that shall be supplemental and complimentary 
with and under no circumstances a substitution for the provisions of 
the Constitution and laws of the United States extended to the subsoil 
and seabed of the outer Continental Shelf pursuant to section 4 of this 
Act, except insofar as such laws would otherwise apply to individuals 
who have extraordinary ability in the sciences, arts, education, or 
business, which has been demonstrated by sustained national or 
international acclaim, and that''.

SEC. 109. SMALL, WOMAN-OWNED, AND MINORITY-OWNED BUSINESSES.

    Section 8 of the Outer Continental Shelf Lands Act (43 U.S.C. 1337) 
is amended by adding at the end the following:
    ``(q) Opportunities for Leasing.--The Secretary shall establish 
goals to ensure equal opportunity to bid on offshore leases for 
qualified small, women-owned, and minority-owned exploration and 
production companies and may implement, where appropriate, outreach 
programs for qualified historically underutilized exploration and 
production companies to participate in the bidding process for offshore 
leases.''.

SEC. 110. DEFINITIONS.

    In this subtitle:
            (1) Adjacent state.--The term ``adjacent State'' means, 
        with respect to any program, plan, lease sale, leased tract, or 
        other activity, proposed, conducted, or approved in accordance 
        with the Outer Continental Shelf Lands Act (43U.S.C. 1331 et 
        seq.), the State, the laws of which are declared pursuant to 
        section 4(a)(2) of the Outer Continental Shelf Lands Act (43 
        U.S.C.1333(a)(2)) to be the law of the United States for the 
        portion of the Outer Continental Shelf on which the program, 
        plan, lease sale, leased tract, or activity is, or is proposed 
        to be, conducted.
            (2) Coastal environment.--The term ``coastal environment'' 
        has the meaning given that term in the Outer Continental Shelf 
        Lands Act (43 U.S.C. 1331 et seq.).
            (3) Coastal zone.--The term ``coastal zone'' has the 
        meaning given that term in the Outer Continental Shelf Lands 
        Act (43 U.S.C. 1331 et seq.).
            (4) Coastline.--The term ``coastline'' has the meaning 
        given the term ``coast line'' under section 2 of the Submerged 
        Lands Act (43 U.S.C. 1301).
            (5) Human environment.--The term ``human environment'' has 
        the meaning given that term in the Outer Continental Shelf 
        Lands Act (43 U.S.C. 1331 et seq.).
            (6) Marine environment.--The term ``marine environment'' 
        has the meaning given that term in the Outer Continental Shelf 
        Lands Act (43 U.S.C. 1331 et seq.).
            (7) Outer continental shelf.--The term ``Outer Continental 
        Shelf'' has the meaning given the term ``outer Continental 
        Shelf'' under section 2 of the Outer Continental Shelf Lands 
        Act (43 U.S.C. 1331).
            (8) Seaward lateral boundary.--The term ``seaward lateral 
        boundary'' means a boundary drawn by the Minerals Management 
        Service in the Federal Register notice of January 3, 2006 (vol 
        71, no. 1).
            (9) Secretary.--The term ``Secretary'' means the Secretary 
        of the Interior.

     Subtitle B--Diligent Development of Federal Oil and Gas Leases

SEC. 121. CLARIFICATION.

    The lands subject to each lease that authorizes the exploration for 
or development or production of oil or natural gas that is issued under 
a provision of law described in section 122 shall be diligently 
developed for such production by the person holding the lease in order 
to ensure timely production from the lease.

SEC. 122. COVERED PROVISIONS.

    The provisions referred to in section 121 are the following:
            (1) Section 17 of the Mineral Leasing Act (30 U.S.C. 226).
            (2) Section 107 of the Naval Petroleum Reserves Production 
        Act of 1976 (42 U.S.C. 6506a).
            (3) The Outer Continental Shelf Lands Act (43 11 U.S.C. 
        1331 et seq.).
            (4) The Mineral Leasing Act for Acquired Lands (30 U.S.C. 
        351 et seq.).

SEC. 123. REGULATIONS.

    The Secretary shall issue regulations within 180 days after the 
date of enactment of this Act that establish what constitutes 
diligently developing for purposes of this subtitle.

SEC. 124. RESOURCE ESTIMATES AND LEASING PROGRAM MANAGEMENT INDICATORS.

    (a) In General.--The Secretary of the Interior shall annually 
collect and report to Congress--
            (1) the number of leases and the number of acres of land 
        under Federal onshore oil and gas lease, per State and per year 
        the lease was issued--
                    (A) on which seismic exploration activity is 
                occurring or has occurred;
                    (B) on which permits to drill have been applied 
                for, but not yet awarded;
                    (C) on which permits to drill have been approved, 
                but no drilling has yet occurred;
                    (D) on which wells have been drilled but no 
                production has occurred; and
                    (E) on which production is occurring;
            (2) resource estimates for and the number of acres of 
        Federal onshore and offshore lands, by State or offshore 
        planning area--
                    (A) under lease, per year the lease was issued;
                    (B) under lease and not producing, per year the 
                lease was issued;
                    (C) under lease and drilled, but not producing, per 
                year the lease was issued;
                    (D) offered for lease in a lease sale conducted 
                during the previous year, but not leased; and
                    (E) available for leasing but not under lease or 
                offered for leasing in the previous year;
            (3) resource estimates for and the number of acres of 
        unleased Federal onshore and offshore land available for oil 
        and gas leasing;
            (4) resource estimates for and the number of acres of areas 
        of the Outer Continental Shelf--
                    (A) included in proposed sale areas in the most 
                recent 5-year plan developed by the Secretary pursuant 
                to section 18 of the Outer Continental Shelf Lands Act 
                (43 U.S.C. 1344); and
                    (B) available for oil and gas leasing but not 
                included in the 5-year plan;
            (5) the number of leases and the number of acres of Federal 
        onshore land, per Bureau of Land Management field office, 
        offered in a lease sale conducted during the previous year, 
        including data on the number of protests filed and how many 
        lease tracts were withdrawn as a result of such protests, and 
        how many leases were offered and issued with stipulations as a 
        result of those protests, including the name of the entity or 
        entities filing the protests;
            (6) the number of applications for permits to drill 
        received, approved, pending, and denied, in the previous year 
        per Bureau of Land Management and Minerals Management Service 
        field office;
            (7) the number of environmental inspections conducted per 
        State and per Bureau of Land Management and Minerals Management 
        Service field office in the previous year; and
            (8) the number of full time staff equivalent (FTEs) devoted 
        to permit processing and oversight per Bureau of Land 
        Management and Minerals Management Service field office.
    (b) Covered Provisions.--Subsection (a) shall apply with respect to 
leases and land eligible for leasing pursuant to--
            (1) section 17 of the Mineral Leasing Act (30 U.S.C. 226);
            (2) the Mineral Leasing Act for Acquired Lands (30 U.S.C. 
        351 et seq.);
            (3) section 107 of the Naval Petroleum Reserves Production 
        Act of 1976 (42 U.S.C. 6506a); or
            (4) the Outer Continental Shelf Lands Act (43 U.S.C. 1331 
        et seq.).

        Subtitle C--Royalties Under Offshore Oil and Gas Leases

SEC. 131. SHORT TITLE.

    This subtitle may be cited as the ``Royalty Relief for American 
Consumers Act of 2008''.

SEC. 132. PRICE THRESHOLDS FOR ROYALTY SUSPENSION PROVISIONS.

    The Secretary of the Interior shall agree to a request by any 
lessee to amend any oil and gas lease issued for any Gulf of Mexico 
tract during the period of January 1, 1998, through December 31, 1999, 
to incorporate price thresholds applicable to royalty suspension 
provisions, that are equal to or less than the price thresholds 
described in clauses (v) through (vii) of section 8(a)(3)(C) of the 
Outer Continental Shelf Lands Act (43 U.S.C. 1337(a)(3)(C)). Any 
amended lease shall impose the new or revised price thresholds 
effective October 1, 2006. Existing lease provisions shall prevail 
through September 30, 2006.

SEC. 133. CLARIFICATION OF AUTHORITY TO IMPOSE PRICE THRESHOLDS FOR 
              CERTAIN LEASE SALES.

    Congress reaffirms the authority of the Secretary of the Interior 
under section 8(a)(1)(H) of the Outer Continental Shelf Lands Act (43 
U.S.C. 1337(a)(1)(H)) to vary, based on the price of production from a 
lease, the suspension of royalties under any lease subject to section 
304 of the Outer Continental Shelf Deep Water Royalty Relief Act 
(Public Law 104-58; 43 U.S.C. 1337 note).

SEC. 134. ELIGIBILITY FOR NEW LEASES AND THE TRANSFER OF LEASES; 
              CONSERVATION OF RESOURCES FEES.

    (a) Issuance of New Leases.--
            (1) In general.--The Secretary shall not issue any new 
        lease that authorizes the production of oil or natural gas in 
        the Gulf of Mexico under the Outer Continental Shelf Lands Act 
        (43 U.S.C. 1331 et seq.) to a person described in paragraph (2) 
        unless--
                    (A) the person has renegotiated each covered lease 
                with respect to which the person is a lessee, to modify 
                the payment responsibilities of the person to include 
                price thresholds that are equal to or less than the 
                price thresholds described in clauses (v) through (vii) 
                of section 8(a)(3)(C) of the Outer Continental Shelf 
                Lands Act (43 U.S.C. 1337(a)(3)(C)); or
                    (B) the person has--
                            (i) paid all fees established by the 
                        Secretary under subsection (b) that are due 
                        with respect to each covered lease for which 
                        the person is a lessee; or
                            (ii) entered into an agreement with the 
                        Secretary under which the person is obligated 
                        to pay such fees.
            (2) Persons described.--A person referred to in paragraph 
        (1) is a person that--
                    (A) is a lessee that--
                            (i) holds a covered lease on the date on 
                        which the Secretary considers the issuance of 
                        the new lease; or
                            (ii) was issued a covered lease before the 
                        date of enactment of this Act, but transferred 
                        the covered lease to another person or entity 
                        (including a subsidiary or affiliate of the 
                        lessee) after the date of enactment of this 
                        Act; or
                    (B) any other person or entity who has any direct 
                or indirect interest in, or who derives any benefit 
                from, a covered lease;
            (3) Multiple lessees.--
                    (A) In general.--For purposes of paragraph (1), if 
                there are multiple lessees that own a share of a 
                covered lease, the Secretary may implement separate 
                agreements with any lessee with a share of the covered 
                lease that modifies the payment responsibilities with 
                respect to the share of the lessee to include price 
                thresholds that are equal to or less than the price 
                thresholds described in clauses (v) through (vii) of 
                section 8(a)(3)(C) of the Outer Continental Shelf Lands 
                Act (43 U.S.C. 1337(a)(3)(C)).
                    (B) Treatment of share as covered lease.--Beginning 
                on the effective date of an agreement under 
                subparagraph (A), any share subject to the agreement 
                shall not constitute a covered lease with respect to 
                any lessees that entered into the agreement.
    (b) Conservation of Resources Fees.--
            (1) In general.--Not later than 60 days after the date of 
        enactment of this Act, the Secretary of the Interior by 
        regulation shall establish--
                    (A) a conservation of resources fee for producing 
                Federal oil and gas leases in the Gulf of Mexico; and
                    (B) a conservation of resources fee for 
                nonproducing Federal oil and gas leases in the Gulf of 
                Mexico.
            (2) Producing lease fee terms.--The fee under paragraph 
        (1)(A)--
                    (A) subject to subparagraph (C), shall apply to 
                covered leases that are producing leases;
                    (B) shall be set at $9 per barrel for oil and $1.25 
                per million Btu for gas, respectively, in 2005 dollars; 
                and
                    (C) shall apply only to production of oil or gas 
                occurring--
                            (i) in any calendar year in which the 
                        arithmetic average of the daily closing prices 
                        for light sweet crude oil on the New York 
                        Mercantile Exchange (NYMEX) exceeds $34.73 per 
                        barrel for oil and $4.34 per million Btu for 
                        gas in 2005 dollars; and
                            (ii) on or after October 1, 2006.
            (3) Nonproducing lease fee terms.--The fee under paragraph 
        (1)(B)--
                    (A) subject to subparagraph (C), shall apply to 
                leases that are nonproducing leases;
                    (B) shall be set at $3.75 per acre per year in 2005 
                dollars; and
                    (C) shall apply on and after October 1, 2006.
            (4) Treatment of receipts.--Amounts received by the United 
        States as fees under this subsection shall be treated as 
        offsetting receipts.
    (c) Transfers.--A lessee or any other person who has any direct or 
indirect interest in, or who derives a benefit from, a lease shall not 
be eligible to obtain by sale or other transfer (including through a 
swap, spinoff, servicing, or other agreement) any covered lease, the 
economic benefit of any covered lease, or any other lease for the 
production of oil or natural gas in the Gulf of Mexico under the Outer 
Continental Shelf Lands Act (43 U.S.C. 1331 et seq.), unless--
            (1) the lessee or other person has--
                    (A) renegotiated all covered leases of the lessee 
                or other person; and
                    (B) entered into an agreement with the Secretary to 
                modify the terms of all covered leases of the lessee or 
                other person to include limitations on royalty relief 
                based on market prices that are equal to or less than 
                the price thresholds described in clauses (v) through 
                (vii) of section 8(a)(3)(C) of the Outer Continental 
                Shelf Lands Act (43 U.S.C. 1337(a)(3)(C)); or
            (2) the lessee or other person has--
                    (A) paid all fees established by the Secretary 
                under subsection (b) that are due with respect to each 
                covered lease for which the person is a lessee; or
                    (B) entered into an agreement with the Secretary 
                under which the person is obligated to pay such fees.
    (d) Definitions.--In this section--
            (1) Covered lease.--The term ``covered lease'' means a 
        lease for oil or gas production in the Gulf of Mexico that is--
                    (A) in existence on the date of enactment of this 
                Act;
                    (B) issued by the Department of the Interior under 
                section 304 of the Outer Continental Shelf Deep Water 
                Royalty Relief Act (43 U.S.C. 1337 note; Public Law 
                104-58); and
                    (C) not subject to limitations on royalty relief 
                based on market price that are equal to or less than 
                the price thresholds described in clauses (v) through 
                (vii) of section 8(a)(3)(C) of the Outer Continental 
                Shelf Lands Act (43 U.S.C. 1337(a)(3)(C)).
            (2) Lessee.--The term ``lessee'' includes any person or 
        other entity that controls, is controlled by, or is in or under 
        common control with, a lessee.
            (3) Secretary.--The term ``Secretary'' means the Secretary 
        of the Interior.

SEC. 135. STRATEGIC ENERGY EFFICIENCY AND RENEWABLES RESERVE.

    (a) In General.--For budgetary purposes, the net increase in 
Federal receipts by reason of the enactment of this Act shall be held 
in a separate account to be known as the ``Strategic Energy Efficiency 
and Renewables Reserve''. The Strategic Energy Efficiency and 
Renewables Reserve shall be available to offset the cost of subsequent 
legislation--
            (1) to accelerate the use of clean domestic renewable 
        energy resources and alternative fuels;
            (2) to promote the utilization of energy-efficient products 
        and practices and energy conservation;
            (3) to increase research, development, and deployment of 
        clean renewable energy and efficiency technologies;
            (4) to provide increased assistance for low income home 
        energy and weatherization programs;
            (5) to further the purposes set forth in section 1(b) of 
        the Land and Water Conservation Fund Act of 1965 (16 U.S.C. 
        460l-4); and
            (6) to increase research, development, and demonstration of 
        carbon capture and sequestration technologies.
    (b) Procedure for Adjustments.--
            (1) Budget committee chairman.--After the reporting of a 
        bill or joint resolution, or the offering of an amendment 
        thereto or the submission of a conference report thereon, 
        providing funding for the purposes set forth in subsection (a) 
        in excess of the amounts provided for those purposes for fiscal 
        year 2007, the chairman of the Committee on the Budget of the 
        applicable House of Congress shall make the adjustments set 
        forth in paragraph (2) for the amount of new budget authority 
        and outlays in that measure and the outlays flowing from that 
        budget authority.
            (2) Matters to be adjusted.--The adjustments referred to in 
        paragraph (1) are to be made to--
                    (A) the discretionary spending limits, if any, set 
                forth in the appropriate concurrent resolution on the 
                budget;
                    (B) the allocations made pursuant to the 
                appropriate concurrent resolution on the budget 
                pursuant to section 302(a) of Congressional Budget Act 
                of 1974; and
                    (C) the budget aggregates contained in the 
                appropriate concurrent resolution on the budget as 
                required by section 301(a) of Congressional Budget Act 
                of 1974.
            (3) Amounts of adjustments.--The adjustments referred to in 
        paragraphs (1) and (2) shall not exceed the total of the 
        receipts over a 10-year period, as estimated by the 
        Congressional Budget Office upon the enactment of this Act.

 Subtitle D--Accountability and Integrity in the Federal Energy Program

SEC. 141. ROYALTY IN-KIND.

    Section 342(d) of the Energy Policy Act of 2005 (42 U.S.C. 
15902(d)) is amended to read as follows:
    ``(d) Benefit to the United States Required.--The Secretary may 
receive oil or gas royalties in-kind only if the Secretary determines 
that receiving royalties in-kind provides benefits to the United States 
that are greater than or equal to the benefits that would likely be 
received if the royalties were taken in-value, and if the Secretary 
determines that receiving royalties in-kind is consistent with the 
fiduciary duties of the Secretary on behalf of the American people.''.

SEC. 142. FAIR RETURN ON PRODUCTION OF FEDERAL OIL AND GAS RESOURCES.

    (a) Royalty Payments.--The Secretary of the Interior shall take all 
steps necessary to ensure that lessees under leases for exploration, 
development, and production of oil and natural gas on Federal lands, 
including leases under the Mineral Leasing Act (30 U.S.C. 181 et seq.), 
the Mineral Leasing Act for Acquired Lands (30 U.S.C. 351 et seq.), the 
Outer Continental Shelf Lands Act (30 U.S.C. 1331 et seq.), and all 
other mineral leasing laws, are making prompt, transparent, and 
accurate royalty payments under such leases.
    (b) Recommendations for Legislative Action.--In order to facilitate 
implementation of subsection (a), the Secretary of the Interior shall, 
within 180 days after the date of enactment of this Act and in 
consultation with the affected States, prepare and transmit to Congress 
recommendations for legislative action to improve the accurate 
collection of Federal oil and gas royalties.

SEC. 143. ROYALTY-IN-KIND ETHICS.

    (a) Gift Ban.--
            (1) Prohibition.--No employee of the Minerals Management 
        Service may--
                    (A) accept gifts of any value from any prohibited 
                source; or
                    (B) seek, accept, or hold employment with any 
                prohibited source.
            (2) Penalty.--Any person who violates paragraph (1) shall 
        be subject to such penalties as the Secretary of the Interior 
        considers appropriate, which may include suspension without pay 
        or termination.
    (b) Training.--The Secretary of the Interior shall implement a 
robust ethics training program for employees of the Royalty-In-Kind 
division of the Minerals Management Service that is in addition to the 
standard ethics training that such employees are already required to 
attend. Such additional training program shall require written 
certification by each such employee that the employee knows and 
understands the ethics requirements by which the employee is bound.
    (c) Code of Ethics.--The Secretary of the Interior shall 
promulgate, within 180 days after the date of the enactment of this 
Act, a code of ethics for all employees of the Minerals Management 
Service. The code of ethics shall provide clear direction relating to 
the obligations, prohibitions, and consequences of misconduct.
    (d) Drug Testing.--The Secretary of the Interior shall, within 180 
days after the date of the enactment of this Act, implement a random 
drug testing program for the employees of the royalty-in-kind division 
of the Minerals Management Service.
    (e) Definitions.--In this section:
            (1) Gift.--The term ``gift''--
                    (A) includes any gratuity, favor, discount, 
                entertainment, hospitality, loan, forbearance, or other 
                item having monetary value; and
                    (B) includes services as well as gifts of training, 
                transportation, local travel, lodgings and meals, 
                whether provided in-kind, by purchase of a ticket, 
                payment in advance, or reimbursement after the expense 
                has been incurred.
            (2) Prohibited source.--The term ``prohibited source'' 
        means, with respect to an employee, any person who--
                    (A) is seeking official action by the Minerals 
                Management Service;
                    (B) does business or seeks to do business with the 
                Minerals Management Service;
                    (C) conducts activities regulated by the Minerals 
                Management Service;
                    (D) has interests that may be substantially 
                affected by performance or nonperformance of the 
                employee's official duties; or
                    (E) is an organization a majority of whose members 
                are described in any of subparagraphs (A) through (D).
    (f) Other Ethics Requirements Apply.--The prohibitions and 
requirements under this section are to be in addition to any other 
requirements that apply to employees of the Minerals Management 
Service.

SEC. 144. PROHIBITION ON CERTAIN GIFTS.

    Section 201 of title 18, United States Code, is amended--
            (1) by redesignating subsections (d) and (e) as subsections 
        (e) and (f); and
            (2) by inserting after subsection (c) the following new 
        subsection:
    ``(d)(1) Whoever--
                    ``(A) seeking or holding one or more leases of 
                property from the United States, through the Minerals 
                Management Service of the Department of the Interior, 
                for purposes of oil or mineral extraction, knowingly 
                engages in a course of conduct that consists of 
                providing things of value to a public official of, or 
                person who has been selected to be a public official 
                of, the Minerals Management Service, because of the 
                official's or person's position in the Minerals 
                Management Service; or
                    ``(B) being a public official of, or person who has 
                been selected to be a public official of, the Minerals 
                Management Service of the Department of the Interior, 
                knowingly engages in a course of conduct consisting of 
                receiving things of value, knowing that such things of 
                value were provided because of the official's or 
                person's position in the Minerals Management Service, 
                from a person seeking or holding one or more leases of 
                property from the United States, through the Minerals 
                Management Service, for purposes of oil or mineral 
                extraction;
shall be fined under this title, imprisoned for not more than two 
years, or both, except that a corporation, partnership, or other 
organization that violates subparagraph (A) shall be fined $25,000,000 
and an amount equal to its gross revenues arising, during the period in 
which the course of conduct described in subparagraph (A) occurred, 
from the lease or leases described in that subparagraph.
    ``(2) For purposes of this subsection, the term `course of conduct' 
means a series of acts over a period of time evidencing a continuity of 
purpose.
    ``(3)(A) The Attorney General may bring a civil action in the 
appropriate United States district court against any corporation, 
partnership, or other organization that engages in conduct constituting 
an offense under paragraph (1)(A) and, upon proof of such conduct by a 
preponderance of the evidence, such corporation, partnership, or other 
organization shall be subject to a civil penalty of not more than 
$25,000,000 and an amount equal to its gross revenues arising, during 
the period in which the course of conduct described in paragraph (1)(A) 
occurred, from the lease or leases described in that paragraph.
    ``(B) If a corporation, partnership, or other organization is held 
liable for a civil penalty under subparagraph (A) for a violation of 
paragraph (1)(A), the United States may terminate the lease or leases 
that were the subject to the violation, and the United States shall not 
be liable for any damages to any party to such lease or leases by 
reason of such termination.
    ``(C) The imposition of a civil penalty under this paragraph does 
not preclude any other criminal or civil statutory, common law, or 
administrative remedy that is available to the United States, or any 
other person, under this section or any other law.''.

SEC. 145. STRENGTHENING THE ABILITY OF THE INTERIOR DEPARTMENT 
              INSPECTOR GENERAL TO SECURE COOPERATION.

    The Inspector General Act of 1978 (5 U.S.C. App.) is amended by 
inserting after section 8K the following:

     ``special provisions concerning the department of the interior

    ``Sec. 8L.  Notwithstanding section 6(a)(4), the Inspector General 
of the Department of the Interior may, in any inquiry or investigation 
involving leases of property from the United States through the 
Minerals Management Services for purposes of oil and mineral 
extraction, require by subpoena the production of all information, 
documents, reports, answers, records, accounts, papers, and other data 
in any medium, including electronically stored information and tangible 
things, and testimony necessary in the performance of the functions 
assigned by this Act, which subpoena, in the case of contumacy or 
refusal to obey, shall be enforceable by order of any appropriate 
United States district court: Provided, that procedures other than 
subpoenas shall be used by the Inspector General to obtain documents, 
information, or testimony from Federal agencies.''.

             Subtitle E--Federal Oil and Gas Royalty Reform

SEC. 151. AMENDMENTS TO DEFINITIONS.

    Section 3 of the Federal Oil and Gas Royalty Management Act of 1982 
(30 U.S.C. 1702) is amended--
            (1) in paragraph (20)(A), by striking ``: Provided, That'' 
        and all that follows through ``subject of the judicial 
        proceeding'';
            (2) in paragraph (20)(B), by striking ``(with written 
        notice to the lessee who designated the designee)'';
            (3) in paragraph (23)(A), by striking ``(with written 
        notice to the lessee who designated the designee)'';
            (4) by amending paragraph (24) to read as follows:
            ``(24) `designee' means any person who pays, offsets, or 
        credits monies, makes adjustments, requests and receives 
        refunds, or submits reports with respect to payments a lessee 
        must make pursuant to section 102(a);'';
            (5) in paragraph (25)(B), by striking ``(subject to the 
        provisions of section 102(a) of this Act)''; and
            (6) in paragraph (26), by striking ``(with notice to the 
        lessee who designated the designee)''.

SEC. 152. INTEREST.

    (a) Estimated Payments; Interest on Amount of Underpayment.--
Section 111(j) of the Federal Oil and Gas Royalty Management Act of 
1982 (30 U.S.C. 1721(j)) is amended by striking ``If the estimated 
payment exceeds the actual royalties due, interest is owed on the 
overpayment.''.
    (b) Overpayments.--Section 111 of the Federal Oil and Gas Royalty 
Management Act of 1982 (30 U.S.C. 1721) is amended by striking 
subsections (h) and (i).
    (c) Effective Date.--The amendments made by this section shall be 
effective one year after the date of enactment of this Act.

SEC. 153. OBLIGATION PERIOD.

    Section 115(c) of the Federal Oil and Gas Royalty Management Act of 
1982 (30 U.S.C. 1724(c)) is amended by adding at the end the following:
            ``(3) Adjustments.--In the case of an adjustment under 
        section 111A(a) (30 U.S.C. 1721a(a)) in which a recoupment by 
        the lessee results in an underpayment of an obligation, for 
        purposes of this Act the obligation becomes due on the date the 
        lessee or its designee makes the adjustment.''.

SEC. 154. TOLLING AGREEMENTS AND SUBPOENAS.

    (a) Tolling Agreements.--Section 115(d)(1) of the Federal Oil and 
Gas Royalty Management Act of 1982 (30 U.S.C. 1724(d)(1)) is amended by 
striking ``(with notice to the lessee who designated the designee)''.
    (b) Subpoenas.--Section 115(d)(2)(A) of the Federal Oil and Gas 
Royalty Management Act of 1982 (30 U.S.C. 1724(d)(2)(A)) is amended by 
striking ``(with notice to the lessee who designated the designee, 
which notice shall not constitute a subpoena to the lessee)''.

SEC. 155. LIABILITY FOR ROYALTY PAYMENTS.

    Section 102(a) of the Federal Oil and Gas Royalty Management Act of 
1982 (30 U.S.C. 1712(a)) is amended to read as follows:
    ``(a) In order to increase receipts and achieve effective 
collections of royalty and other payments, a lessee who is required to 
make any royalty or other payment under a lease or under the mineral 
leasing laws, shall make such payments in the time and manner as may be 
specified by the Secretary or the applicable delegated State. Any 
person who pays, offsets or credits monies, makes adjustments, requests 
and receives refunds, or submits reports with respect to payments the 
lessee must make is the lessee's designee under this Act. 
Notwithstanding any other provision of this Act to the contrary, a 
designee shall be liable for any payment obligation of any lessee on 
whose behalf the designee pays royalty under the lease. The person 
owning operating rights in a lease and a person owning legal record 
title in a lease shall be liable for that person's pro rata share of 
payment obligations under the lease.''.

            Subtitle F--National Petroleum Reserve in Alaska

SEC. 161. SHORT TITLE.

    This subtitle may be cited as the ``Drill Responsibly in Leased 
Lands Act of 2008''.

SEC. 162. ACCELERATION OF LEASE SALES FOR NATIONAL PETROLEUM RESERVE IN 
              ALASKA.

    Section 107(d) of the Naval Petroleum Reserves Production Act of 
1976 (42 U.S.C. 6506a(d)) is amended--
            (1) by striking ``(d)'' and all that follows through ``; 
        first lease sale'' and inserting the following:
    ``(d) Lease Sales.--
            ``(1) First lease sale.--The first lease sale''; and
            (2) by adding at the end the following:
            ``(2) Subsequent lease sales.--The Secretary shall 
        accelerate, to the maximum extent practicable, competitive and 
        environmentally responsible leasing of oil and gas in the 
        Reserve in accordance with this Act and all applicable 
        environmental laws, including at least 1 lease sale during each 
        of calendar years 2009 through 2013.''.

SEC. 163. NATIONAL PETROLEUM RESERVE IN ALASKA: PIPELINE CONSTRUCTION.

    The Federal Energy Regulatory Commission shall facilitate, in an 
environmentally responsible manner and in coordination with the 
Secretary of the Interior, the Secretary of Transportation, the 
Secretary of Energy, and the State of Alaska, the construction of 
pipelines necessary to transport oil and natural gas from or through 
the National Petroleum Reserve in Alaska to existing transportation or 
processing infrastructure on the North Slope of Alaska.

SEC. 164. ALASKA NATURAL GAS PIPELINE PROJECT FACILITATION.

    (a) Findings.--Congress finds the following:
            (1) Over 35 trillion cubic feet of natural gas reserves 
        have been discovered on Federal and State lands currently open 
        to oil and natural gas leasing on the North Slope of Alaska.
            (2) These gas supplies could make a significant 
        contribution to meeting the energy needs of the United States, 
        but the lack of a natural gas transportation system has 
        prevented these natural gas reserves from reaching markets in 
        the lower 48 States.
    (b) Facilitation by President.--The President shall, pursuant to 
the Alaska Natural Gas Pipeline Act (division C of Public Law 108-324; 
15 U.S.C. 720 et seq.) and other applicable law, coordinate with 
producers of natural gas on the North Slope of Alaska, Federal 
agencies, the State of Alaska, Canadian authorities, pipeline 
companies, and other interested persons in order to facilitate 
construction of a natural gas pipeline from Alaska to United States 
markets as expeditiously as possible.

SEC. 165. PROJECT LABOR AGREEMENTS AND OTHER PIPELINE REQUIREMENTS.

    (a) Project Labor Agreements.--The President, as a term and 
condition of any permit required under Federal law for the pipelines 
referred to in section 163 and 164, and in recognizing the Government's 
interest in labor stability and in the ability of construction labor 
and management to meet the particular needs and conditions of such 
pipelines to be developed under such permits and the special concerns 
of the holders of such permits, shall require that the operators of 
such pipelines and their agents and contractors negotiate to obtain a 
project labor agreement for the employment of laborers and mechanics on 
production, maintenance, and construction for such pipelines.
    (b) Pipeline Maintenance.--The Secretary of Transportation shall 
require every pipeline operator authorized to transport oil and gas 
produced under Federal oil and gas leases in Alaska through the Trans-
Alaska Pipeline, any pipeline constructed pursuant to section 163 or 
164 of this Act, or any other federally approved pipeline transporting 
oil and gas from the North Slope of Alaska, to certify to the Secretary 
of Transportation annually that such pipeline is being fully maintained 
and operated in an efficient manner. The Secretary of Transportation 
shall assess appropriate civil penalties for violations of this 
requirement in the same manner as civil penalties are assessed for 
violations under section 60122(a)(1) of title 49, United States Code.

SEC. 166. BAN ON EXPORT OF ALASKAN OIL.

    (a) Repeal of Provision Authorizing Exports.--Section 28(s) of the 
Mineral Leasing Act (30 U.S.C. 185(s)) is repealed.
    (b) Reimposition of Prohibition on Crude Oil Exports.--Upon the 
effective date of this Act, subsection (d) of section 7 of the Export 
Administration Act of 1979 (50 U.S.C. App. 2406(d)), shall be 
effective, and any other provision of that Act (including sections 11 
and 12) shall be effective to the extent necessary to carry out such 
section 7(d), notwithstanding section 20 of that Act or any other 
provision of law that would otherwise allow exports of oil to which 
such section 7(d) applies.

                         Subtitle G--Oil Shale

SEC. 171. OIL SHALE LEASING.

    (a) Repeal of Restriction.--Section 433 of the Department of the 
Interior, Environment, and Related Agencies Appropriations Act, 2008 
(division F of Public Law 110-161; 121 Stat. 2152) is repealed.
    (b) Requirement That State Approve of Oil Shale Leasing.--Section 
369 of the Energy Policy Act of 2005 (42 U.S.C. 15927) is amended by 
adding at the end the following:
    ``(t) Requirement That State Approve of Oil Shale Leasing.--No 
lease may be issued under this section, section 21 of the Mineral 
Leasing Act (30 U.S.C. 241), or any other law, for exploration, 
research, development, or production of oil shale on lands located in a 
State, unless the State has enacted a law approving of Federal oil 
shale leasing in the State. Nothing in this subsection shall be 
construed as preventing the Department of the Interior from preparing 
an environmental impact statement under the existing authority under 
the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) 
with respect to an individual lease sale proposed under the commercial 
leasing program established under this section.''.

                    TITLE II--CONSUMER ENERGY SUPPLY

SEC. 201. SHORT TITLE.

    This title may be cited as the ``Consumer Energy Supply Act of 
2008''.

SEC. 202. DEFINITIONS.

    In this title--
            (1) the term ``light grade petroleum'' means crude oil with 
        an API gravity of 30 degrees or higher;
            (2) the term ``heavy grade petroleum'' means crude oil with 
        an API gravity of 26 degrees or lower; and
            (3) the term ``Secretary'' means the Secretary of Energy.

SEC. 203. SALE AND REPLACEMENT OF OIL FROM THE STRATEGIC PETROLEUM 
              RESERVE.

    (a) Initial Petroleum Sale and Replacement.--Notwithstanding 
section 161 of the Energy Policy and Conservation Act (42 U.S.C. 6241), 
the Secretary shall publish a plan not later than 15 days after the 
date of enactment of this Act to--
            (1) sell, in the amounts and on the schedule described in 
        subsection (b), light grade petroleum from the Strategic 
        Petroleum Reserve and acquire an equivalent volume of heavy 
        grade petroleum;
            (2) deposit the cash proceeds from sales under paragraph 
        (1) into the SPR Petroleum Account established under section 
        167 of the Energy Policy and Conservation Act (42 U.S.C. 6247); 
        and
            (3) from the cash proceeds deposited pursuant to paragraph 
        (2), withdraw the amount necessary to pay for the direct 
        administrative and operational costs of the sale and 
        acquisition.
    (b) Amounts and Schedule.--The sale and acquisition described in 
subsection (a) shall require the offer for sale of a total quantity of 
70,000,000 barrels of light grade petroleum from the Strategic 
Petroleum Reserve. The sale shall commence, whether or not a plan has 
been published under subsection (a), not later than 30 days after the 
date of enactment of this Act and be completed no more than six months 
after the date of enactment of this Act, with at least 20,000,000 
barrels to be offered for sale within the first 60 days after the date 
of enactment of this Act. In no event shall the Secretary sell barrels 
of oil under subsection (a) that would result in a Strategic Petroleum 
Reserve that contains fewer than 90 percent of the total amount of 
barrels in the Strategic Petroleum Reserve as of the date of enactment 
of this Act. Heavy grade petroleum, to replace the quantities of light 
grade petroleum sold under this section, shall be obtained through 
acquisitions which--
            (1) shall commence no sooner than 6 months after the date 
        of enactment of this Act;
            (2) shall be completed, at the discretion of the Secretary, 
        not later than 5 years after the date of enactment of this Act;
            (3) shall be carried out in a manner so as to maximize the 
        monetary value to the Federal Government; and
            (4) shall be carried out using the receipts from the sales 
        of light grade petroleum authorized under this section.
    (c) Deferrals.--The Secretary is encouraged to, when economically 
beneficial and practical, grant requests to defer scheduled deliveries 
of petroleum to the Reserve under subsection (a) if the deferral will 
result in a premium paid in additional barrels of oil which will reduce 
the cost of oil acquisition and increase the volume of oil delivered to 
the Reserve or yield additional cash bonuses.

                    TITLE III--PUBLIC TRANSPORTATION

SEC. 301. SHORT TITLE.

    This title may be cited as the ``Saving Energy Through Public 
Transportation Act of 2008''.

SEC. 302. FINDINGS.

    Congress finds the following:
            (1) In 2007, people in the United States took more than 
        10.3 billion trips using public transportation, the highest 
        level in 50 years.
            (2) Public transportation use in the United States is up 32 
        percent since 1995, a figure that is more than double the 
        growth rate of the Nation's population and is substantially 
        greater than the growth rate for vehicle miles traveled on the 
        Nation's highways for that same period.
            (3) Public transportation use saves fuel, reduces 
        emissions, and saves money for the people of the United States.
            (4) The direct petroleum savings attributable to public 
        transportation use is 1.4 billion gallons per year, and when 
        the secondary effects of transit availability on travel are 
        also taken into account, public transportation use saves the 
        United States the equivalent of 4.2 billion gallons of gasoline 
        per year (more than 11 million gallons of gasoline per day).
            (5) Public transportation use in the United States is 
        estimated to reduce carbon dioxide emissions by 37 million 
        metric tons annually.
            (6) An individual who commutes to work using a single 
        occupancy vehicle can reduce carbon dioxide emissions by 20 
        pounds per day (more than 4,800 pounds per year) by switching 
        to public transportation.
            (7) Public transportation use provides an affordable 
        alternative to driving, as households that use public 
        transportation save an average of $6,251 every year.
            (8) Although under existing laws Federal employees in the 
        National Capital Region receive transit benefits, transit 
        benefits should be available to all Federal employees in the 
        United States so that the Federal Government sets a leading 
        example of greater public transportation use.
            (9) Public transportation stakeholders should engage and 
        involve local communities in the education and promotion of the 
        importance of utilizing public transportation.
            (10) Increasing public transportation use is a national 
        priority.

SEC. 303. GRANTS TO IMPROVE PUBLIC TRANSPORTATION SERVICES.

    (a) Authorizations of Appropriations.--
            (1) Urbanized area formula grants.--In addition to amounts 
        allocated under section 5338(b)(2)(B) of title 49, United 
        States Code, to carry out section 5307 of such title, there is 
        authorized to be appropriated $750,000,000 for each of fiscal 
        years 2008 and 2009 to carry out such section 5307. Such funds 
        shall be apportioned, not later than 7 days after the date on 
        which the funds are appropriated, in accordance with section 
        5336 (other than subsections (i)(1) and (j)) of such title but 
        may not be combined or commingled with any other funds 
        apportioned under such section 5336.
            (2) Formula grants for other than urbanized areas.--In 
        addition to amounts allocated under section 5338(b)(2)(G) of 
        title 49, United States Code, to carry out section 5311 of such 
        title, there is authorized to be appropriated $100,000,000 for 
        each of fiscal years 2008 and 2009 to carry out such section 
        5311. Such funds shall be apportioned, not later than 7 days 
        after the date on which the funds are appropriated, in 
        accordance with such section 5311 but may not be combined or 
        commingled with any other funds apportioned under such section 
        5311.
    (b) Use of Funds.--Notwithstanding sections 5307 and 5311 of title 
49, United States Code, the Secretary of Transportation may make grants 
under such sections from amounts appropriated under subsection (a) only 
for one or more of the following:
            (1) If the recipient of the grant is reducing, or certifies 
        to the Secretary within the time the Secretary prescribes that, 
        during the term of the grant, the recipient will reduce one or 
        more fares the recipient charges for public transportation, or 
        in the case of subsection (f) of such section 5311, intercity 
        bus service, those operating costs of equipment and facilities 
        being used to provide the public transportation, or in the case 
        of subsection (f) of such section 5311, intercity bus service, 
        that the recipient is no longer able to pay from the revenues 
        derived from such fare or fares as a result of such reduction.
            (2) If the recipient of the grant is expanding, or 
        certifies to the Secretary within the time the Secretary 
        prescribes that, during the term of the grant, the recipient 
        will expand public transportation service, or in the case of 
        subsection (f) of such section 5311, intercity bus service, 
        those operating and capital costs of equipment and facilities 
        being used to provide the public transportation service, or in 
        the case of subsection (f) of such section 5311, intercity bus 
        service, that the recipient incurs as a result of the expansion 
        of such service.
            (3) To avoid increases in fares for public transportation, 
        or in the case of subsection (f) of such section 5311, 
        intercity bus service, or decreases in current public 
        transportation service, or in the case of subsection (f) of 
        such section 5311, intercity bus service, that would otherwise 
        result from an increase in costs to the public transportation 
        or intercity bus agency for transportation-related fuel or 
        meeting additional transportation-related equipment or facility 
        maintenance needs, if the recipient of the grant certifies to 
        the Secretary within the time the Secretary prescribes that, 
        during the term of the grant, the recipient will not increase 
        the fares that the recipient charges for public transportation, 
        or in the case of subsection (f) of such section 5311, 
        intercity bus service, or, will not decrease the public 
        transportation service, or in the case of subsection (f) of 
        such section 5311, intercity bus service, that the recipient 
        provides.
            (4) If the recipient of the grant is acquiring, or 
        certifies to the Secretary within the time the Secretary 
        prescribes that, during the term of the grant, the recipient 
        will acquire, clean fuel or alternative fuel vehicle-related 
        equipment or facilities for the purpose of improving fuel 
        efficiency, the costs of acquiring the equipment or facilities.
            (5) If the recipient of the grant is establishing or 
        expanding, or certifies to the Secretary within the time the 
        Secretary prescribes that, during the term of the grant, the 
        recipient will establish or expand, commuter matching services 
        to provide commuters with information and assistance about 
        alternatives to single occupancy vehicle use, those 
        administrative costs in establishing or expanding such 
        services.
    (c) Federal Share.--Notwithstanding any other provision of law, the 
Federal share of the costs for which a grant is made under this section 
shall be 100 percent.
    (d) Period of Availability.--Funds appropriated under this section 
shall remain available for a period of 2 fiscal years.

SEC. 304. INCREASED FEDERAL SHARE FOR CLEAN AIR ACT COMPLIANCE.

    Notwithstanding section 5323(i)(1) of title 49, United States Code, 
a grant for a project to be assisted under chapter 53 of such title 
during fiscal years 2008 and 2009 that involves acquiring clean fuel or 
alternative fuel vehicle-related equipment or facilities for the 
purposes of complying with or maintaining compliance with the Clean Air 
Act (42 U.S.C. 7401 et seq.) shall be for 100 percent of the net 
project cost of the equipment or facility attributable to compliance 
with that Act unless the grant recipient requests a lower grant 
percentage.

SEC. 305. TRANSPORTATION FRINGE BENEFITS.

    (a) Requirement That Agencies Offer Transit Pass Transportation 
Fringe Benefits to Their Employees Nationwide.--
            (1) In general.--Section 3049(a)(1) of the Safe, 
        Accountable, Flexible, Efficient Transportation Equity Act: A 
        Legacy for Users (5 U.S.C. 7905 note; 119 Stat. 1711) is 
        amended--
                    (A) by striking ``Effective'' and all that follows 
                through ``each covered agency'' and inserting ``Each 
                agency''; and
                    (B) by inserting ``at a location in an urbanized 
                area of the United States that is served by fixed route 
                public transportation'' before ``shall be offered''.
            (2) Conforming amendments.--Section 3049(a) of such Act (5 
        U.S.C. 7905 note; 119 Stat. 1711) is amended--
                    (A) in paragraph (3)--
                            (i) by striking subparagraph (A); and
                            (ii) by redesignating subparagraphs (B) 
                        through (F) as subparagraphs (A) through (E), 
                        respectively; and
                    (B) in paragraph (4) by striking ``a covered 
                agency'' and inserting ``an agency''.
    (b) Benefits Described.--Section 3049(a)(2) of such Act (5 U.S.C. 
7905 note; 119 Stat. 1711) is amended by striking the period at the end 
and inserting the following: ``, except that the maximum level of such 
benefits shall be the maximum amount which may be excluded from gross 
income for qualified parking as in effect for a month under section 
132(f)(2)(B) of the Internal Revenue Code of 1986.''.
    (c) Guidance.--Section 3049(a) of such Act (5 U.S.C. 7905 note; 119 
Stat. 1711) is amended by adding at the end the following:
            ``(5) Guidance.--
                    ``(A) Issuance.--Not later than 60 days after the 
                date of enactment of this paragraph, the Secretary of 
                Transportation shall issue guidance on nationwide 
                implementation of the transit pass transportation 
                fringe benefits program under this subsection.
                    ``(B) Uniform application.--
                            ``(i) In general.--The guidance to be 
                        issued under subparagraph (A) shall contain a 
                        uniform application for use by all Federal 
                        employees applying for benefits from an agency 
                        under the program.
                            ``(ii) Required information.--As part of 
                        such an application, an employee shall provide, 
                        at a minimum, the employee's home and work 
                        addresses, a breakdown of the employee's 
                        commuting costs, and a certification of the 
                        employee's eligibility for benefits under the 
                        program.
                            ``(iii) Warning against false statements.--
                        Such an application shall contain a warning 
                        against making false statements in the 
                        application.
                    ``(C) Independent verification requirements.--The 
                guidance to be issued under subparagraph (A) shall 
                contain independent verification requirements to ensure 
                that, with respect to an employee of an agency--
                            ``(i) the eligibility of the employee for 
                        benefits under the program is verified by an 
                        official of the agency;
                            ``(ii) employee commuting costs are 
                        verified by an official of the agency; and
                            ``(iii) records of the agency are checked 
                        to ensure that the employee is not receiving 
                        parking benefits from the agency.
                    ``(D) Program implementation requirements.--The 
                guidance to be issued under subparagraph (A) shall 
                contain program implementation requirements applicable 
                to each agency to ensure that--
                            ``(i) benefits provided by the agency under 
                        the program are adjusted in cases of employee 
                        travel, leave, or change of address;
                            ``(ii) removal from the program is included 
                        in the procedures of the agency relating to an 
                        employee separating from employment with the 
                        agency; and
                            ``(iii) benefits provided by the agency 
                        under the program are made available using an 
                        electronic format (rather than using paper fare 
                        media) where such a format is available for 
                        use.
                    ``(E) Enforcement and penalties.--The guidance to 
                be issued under subparagraph (A) shall contain a 
                uniform administrative policy on enforcement and 
                penalties. Such policy shall be implemented by each 
                agency to ensure compliance with program requirements, 
                to prevent fraud and abuse, and, as appropriate, to 
                penalize employees who have abused or misused the 
                benefits provided under the program.
                    ``(F) Periodic reviews.--The guidance to be issued 
                under subparagraph (A) shall require each agency, not 
                later than September 1 of the first fiscal year 
                beginning after the date of enactment of this 
                paragraph, and every 3 years thereafter, to develop and 
                submit to the Secretary a review of the agency's 
                implementation of the program. Each such review shall 
                contain, at a minimum, the following:
                            ``(i) An assessment of the agency's 
                        implementation of the guidance, including a 
                        summary of the audits and investigations, if 
                        any, of the program conducted by the Inspector 
                        General of the agency.
                            ``(ii) Information on the total number of 
                        employees of the agency that are participating 
                        in the program.
                            ``(iii) Information on the total number of 
                        single occupancy vehicles removed from the 
                        roadway network as a result of participation by 
                        employees of the agency in the program.
                            ``(iv) Information on energy savings and 
                        emissions reductions, including reductions in 
                        greenhouse gas emissions, resulting from 
                        reductions in single occupancy vehicle use by 
                        employees of the agency that are participating 
                        in the program.
                            ``(v) Information on reduced congestion and 
                        improved air quality resulting from reductions 
                        in single occupancy vehicle use by employees of 
                        the agency that are participating in the 
                        program.
                            ``(vi) Recommendations to increase program 
                        participation and thereby reduce single 
                        occupancy vehicle use by Federal employees 
                        nationwide.
            ``(6) Reporting requirements.--Not later than September 30 
        of the first fiscal year beginning after the date of enactment 
        of this paragraph, and every 3 years thereafter, the Secretary 
        shall submit to the Committee on Transportation and 
        Infrastructure and the Committee on Oversight and Government 
        Reform of the House of Representatives and the Committee on 
        Banking, Housing, and Urban Affairs of the Senate a report on 
        nationwide implementation of the transit pass transportation 
        fringe benefits program under this subsection, including a 
        summary of the information submitted by agencies pursuant to 
        paragraph (5)(F).''.
    (d) Effective Date.--Except as otherwise specifically provided, the 
amendments made by this section shall become effective on the first day 
of the first fiscal year beginning after the date of enactment of this 
Act.

SEC. 306. CAPITAL COST OF CONTRACTING VANPOOL PILOT PROGRAM.

    (a) Establishment.--The Secretary of Transportation shall establish 
and implement a pilot program to carry out vanpool demonstration 
projects in not more than 3 urbanized areas and not more than 2 other 
than urbanized areas.
    (b) Pilot Program.--
            (1) In general.--Notwithstanding section 5323(i) of title 
        49, United States Code, for each project selected for 
        participation in the pilot program, the Secretary shall allow 
        the non-Federal share provided by a recipient of assistance for 
        a capital project under chapter 53 of such title to include the 
        amounts described in paragraph (2).
            (2) Conditions on acquisition of vans.--The amounts 
        referred to in paragraph (1) are any amounts expended by a 
        private provider of public transportation by vanpool for the 
        acquisition of vans to be used by such private provider in the 
        recipient's service area, excluding any amounts the provider 
        may have received in Federal, State, or local government 
        assistance for such acquisition, if the private provider enters 
        into a legally binding agreement with the recipient that 
        requires the private provider to use all revenues it receives 
        in providing public transportation in such service area, in 
        excess of its operating costs, for the purpose of acquiring 
        vans to be used by the private provider in such service area.
    (c) Program Term.--The Secretary may approve an application for a 
vanpool demonstration project for fiscal years 2008 through 2009.
    (d) Report to Congress.--Not later than one year after the date of 
enactment of this Act, the Secretary shall submit to the Committee on 
Transportation and Infrastructure of the House of Representatives and 
the Committee on Banking, Housing, and Urban Affairs of the Senate a 
report containing an assessment of the costs, benefits, and 
efficiencies of the vanpool demonstration projects.

SEC. 307. NATIONAL CONSUMER AWARENESS PROGRAM.

    (a) In General.--The Secretary of Transportation shall carry out a 
national consumer awareness program to educate the public on the 
environmental, energy, and economic benefits of public transportation 
alternatives to the use of single occupancy vehicles.
    (b) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $1,000,000 for fiscal year 2009. 
Such sums shall remain available until expended.

SEC. 308. EXCEPTION TO ALTERNATIVE FUEL PROCUREMENT REQUIREMENT.

    Section 526 of the Energy Independence and Security Act of 2007 
(Public Law 110-140; 42 U.S. C. 17142) is amended--
            (1) by striking ``No Federal agency'' and inserting ``(a) 
        Requirement.--Except as provided in subsection (b), no Federal 
        agency''; and
            (2) by adding at the end the following:
    ``(b) Exception.--Subsection (a) does not prohibit a Federal agency 
from entering into a contract to purchase a generally available fuel 
that is not an alternative or synthetic fuel or predominantly produced 
from a nonconventional petroleum source, if--
            ``(1) the contract does not specifically require the 
        contractor to provide an alternative or synthetic fuel or fuel 
        from a nonconventional petroleum source;
            ``(2) the purpose of the contract is not to obtain an 
        alternative or synthetic fuel or fuel from a nonconventional 
        petroleum source; and
            ``(3) the contract does not provide incentives for a 
        refinery upgrade or expansion to allow a refinery to use or 
        increase its use of fuel from a nonconventional petroleum 
        source.''.

         TITLE IV--GREATER ENERGY EFFICIENCY IN BUILDING CODES

SEC. 401. GREATER ENERGY EFFICIENCY IN BUILDING CODES.

    (a) In General.--Section 304 of the Energy Conservation and 
Production Act (42 U.S.C. 6833) is amended to read as follows:

``SEC. 304. UPDATING STATE BUILDING ENERGY EFFICIENCY CODES.

    ``(a) Updating National Model Building Energy Codes.--(1) The 
Secretary shall support updating the national model building energy 
codes and standards at least every three years to achieve overall 
energy savings, compared to the 2006 IECC for residential buildings and 
ASHRAE Standard 90.1-2004 for commercial buildings, of at least--
            ``(A) 30 percent in editions of each model code or standard 
        released in or after 2010; and
            ``(B) 50 percent in editions of each model code or standard 
        released in or after 2020.
Targets for specific years shall be set by the Secretary at least 3 
years in advance of each target year, coordinated with the IECC and 
ASHRAE Standard 90.1 cycles, at the maximum level of energy efficiency 
that is technologically feasible and life-cycle cost effective.
    ``(2)(A) Whenever the provisions of the IECC or ASHRAE Standard 
90.1 regarding building energy use are revised, the Secretary shall 
make a preliminary determination not later than 90 days after the date 
of the revision, and a final determination not later than 12 months 
after the date of such revision, on--
            ``(i) whether such revision will improve energy efficiency 
        in buildings; and
            ``(ii) whether such revision will meet the targets under 
        paragraph (1).
    ``(B) If the Secretary makes a determination under subparagraph 
(A)(ii) that a code or standard does not meet the targets under 
paragraph (1), or if a national model code or standard is not updated 
for more than three years, then the Secretary shall, within 12 months 
after such determination, establish a modified code or standard that 
meets such targets. Any such modified code or standard--
            ``(i) shall achieve the maximum level of energy savings 
        that is technologically feasible and life-cycle cost-effective;
            ``(ii) shall be based on the latest revision of the IECC or 
        ASHRAE Standard 90.1, including any amendments or additions 
        thereto, but may also consider other model codes or standards; 
        and
            ``(iii) shall serve as the baseline for the next 
        determination under subparagraph (A)(i).
    ``(C) The Secretary shall provide the opportunity for public 
comment on targets, determinations, and modified codes and standards 
under this subsection, and shall publish notice of targets, 
determinations, and modified codes and standards under this subsection 
in the Federal Register.
    ``(b) State Certification of Building Energy Code Updates.--(1) Not 
later than 2 years after the date of enactment of this subsection, each 
State shall certify to the Secretary that it has reviewed and updated 
the provisions of its residential and commercial building codes 
regarding energy efficiency. Such certification shall include a 
demonstration that such State's code provisions meet or exceed the 2006 
IECC for residential buildings and the ASHRAE Standard 90.1-2007 for 
commercial buildings, or achieve equivalent or greater energy savings.
    ``(2)(A) If the Secretary makes an affirmative determination under 
subsection (a)(2)(A)(i) or establishes a modified code or standard 
under subsection (a)(2)(B), each State shall, within 2 years after such 
determination or establishment, certify that it has reviewed and 
updated the provisions of its building code regarding energy 
efficiency. Such certification shall include a demonstration that such 
State's code provisions meet or exceed the revised code or standard, or 
achieve equivalent or greater energy savings.
    ``(B) If the Secretary fails to make a determination under 
subsection (a)(2)(A)(i) by the date specified in subsection (a)(2), or 
makes a negative determination, each State shall within 2 years after 
the specified date or the date of the determination, certify that it 
has reviewed the revised code or standard, and updated the provisions 
of its building code regarding energy efficiency to meet or exceed any 
provisions found to improve energy efficiency in buildings, or to 
achieve equivalent or greater energy savings in other ways.
    ``(c) State Certification of Compliance With Building Codes.--(1) 
Each State shall, not later than 3 years after a certification under 
subsection (b), certify that it has--
            ``(A) achieved compliance under paragraph (3) with the 
        certified State building energy code or with the associated 
        model code or standard; or
            ``(B) made significant progress under paragraph (4) toward 
        achieving compliance with the certified State building energy 
        code or with the associated model code or standard.
If the State certifies progress toward achieving compliance, the State 
shall repeat the certification each year until it certifies that it has 
achieved compliance.
    ``(2) A certification under paragraph (1) shall include 
documentation of the rate of compliance based on independent 
inspections of a random sample of the new and renovated buildings 
covered by the code in the preceding year, or based on an alternative 
method that yields an accurate measure of compliance.
    ``(3)(A) A State shall be considered to achieve compliance under 
paragraph (1) if--
            ``(i) at least 90 percent of new and renovated building 
        space covered by the code in the preceding year substantially 
        meets all the requirements of the code regarding energy 
        efficiency, or achieves an equivalent energy savings level; or
            ``(ii) the estimated excess energy use of new and renovated 
        buildings that did not meet the code in the preceding year, 
        compared to a baseline of comparable buildings that meet the 
        code, is not more than 5 percent of the estimated energy use of 
        all new and renovated buildings covered by the code in the 
        preceding year.
    ``(B) Only renovations with building permits are covered under this 
paragraph. If the Secretary determines the percentage targets under 
subparagraph (A) are not reasonably achievable for renovated 
residential or commercial buildings, the Secretary may reduce the 
targets for such renovated buildings to the highest achievable level.
    ``(4)(A) A State shall be considered to have made significant 
progress toward achieving compliance for purposes of paragraph (1) if 
the State--
            ``(i) has developed and is implementing a plan for 
        achieving compliance within 8 years, assuming continued 
        adequate funding, including active training and enforcement 
        programs;
            ``(ii) after one or more years of adequate funding, has 
        demonstrated progress, in conformance with the plan described 
        in clause (i), toward compliance;
            ``(iii) after five or more years of adequate funding, meets 
        the requirement in paragraph (3) substituting 80 percent for 90 
        percent or substituting 10 percent for 5 percent; and
            ``(iv) has not had more than 8 years of adequate funding.
    ``(B) Funding shall be considered adequate, for purposes of this 
paragraph, when the Federal Government provides to the States at least 
$50,000,000 in a year in funding and support for development and 
implementation of State building energy codes, including for training 
and enforcement.
    ``(d) Failure To Meet Deadlines.--(1) A State that has not made a 
certification required under subsection (b) or (c) by the applicable 
deadline shall submit to the Secretary a report on--
            ``(A) the status of the State with respect to meeting the 
        requirements and submitting the certification; and
            ``(B) a plan for meeting the requirements and submitting 
        the certification.
    ``(2) Any State for which the Secretary has not accepted a 
certification by a deadline under subsection (b) or (c) of this section 
is out of compliance with this section.
    ``(3) In any State that is out of compliance with this section, a 
local government may be in compliance with this section by meeting the 
certification requirements under subsections (b) and (c) of this 
section.
    ``(4) The Secretary shall annually submit to Congress, and publish 
in the Federal Register, a report on the status of national model 
building energy codes and standards, the status of code adoption and 
compliance in the States, and implementation of this section. The 
report shall include estimates of impacts of past action under this 
section and potential impacts of further action on lifetime energy use 
by buildings and resulting energy costs to individuals and businesses.
    ``(e) Technical Assistance.--(1) The Secretary shall on a timely 
basis provide technical assistance to model code-setting and standard 
development organizations. This assistance shall include technical 
assistance as requested by the organizations in evaluating code or 
standards proposals or revisions, building energy analysis and design 
tools, building demonstrations, and design assistance and training. The 
Secretary shall submit code and standard amendment proposals, with 
supporting evidence, sufficient to enable the national model building 
energy codes and standards to meet the targets in subsection (a)(1).
    ``(2) The Secretary shall provide technical assistance to States to 
implement the requirements of this section, including procedures for 
States to demonstrate that their code provisions achieve equivalent or 
greater energy savings than the national model codes and standards, and 
to improve and implement State residential and commercial building 
energy efficiency codes or to otherwise promote the design and 
construction of energy efficient buildings.
    ``(f) Availability of Incentive Funding.--(1) The Secretary shall 
provide incentive funding to States to implement the requirements of 
this section, and to improve and implement State residential and 
commercial building energy efficiency codes, including increasing and 
verifying compliance with such codes. In determining whether, and in 
what amount, to provide incentive funding under this subsection, the 
Secretary shall consider the actions proposed by the State to implement 
the requirements of this section, to improve and implement residential 
and commercial building energy efficiency codes, and to promote 
building energy efficiency through the use of such codes.
    ``(2) Additional funding shall be provided under this subsection 
for implementation of a plan to achieve and document at least a 90 
percent rate of compliance with residential and commercial building 
energy efficiency codes, based on energy performance--
            ``(A) to a State that has adopted and is implementing, on a 
        Statewide basis--
                    ``(i) a residential building energy efficiency code 
                that meets or exceeds the requirements of the 2006 
                IECC, or any succeeding version of that code that has 
                received an affirmative determination from the 
                Secretary under subsection (a)(2)(A)(i); and
                    ``(ii) a commercial building energy efficiency code 
                that meets or exceeds the requirements of the ASHRAE 
                Standard 90.1-2007, or any succeeding version of that 
                standard that has received an affirmative determination 
                from the Secretary under subsection (a)(2)(A)(i); or
            ``(B) in a State in which there is no Statewide energy code 
        for either residential buildings or commercial buildings, or 
        where State codes fail to comply with subparagraph (A), to a 
        local government that has adopted and is implementing 
        residential and commercial building energy efficiency codes, as 
        described in subparagraph (A).
    ``(3) Of the amounts made available under this subsection, the 
Secretary may use amounts required, not exceeding $500,000 for each 
State, to train State and local officials to implement codes described 
in paragraph (2).
    ``(4) There are authorized to be appropriated to carry out this 
subsection--
            ``(A) $70,000,000 for each of fiscal years 2009 through 
        2013; and
            ``(B) such sums as are necessary for fiscal year 2014 and 
        each fiscal year thereafter.''.
    (b) Definition.--Section 303 of the Energy Conservation and 
Production Act (42 U.S.C. 6832) is amended by adding at the end the 
following new paragraph:
            ``(17) The term `IECC' means the International Energy 
        Conservation Code.''.

            TITLE V--FEDERAL RENEWABLE ELECTRICITY STANDARD

SEC. 501. FEDERAL RENEWABLE ELECTRICITY STANDARD.

    (a) In General.--Title VI of the Public Utility Regulatory Policies 
Act of 1978 is amended by adding at the end the following:

``SEC. 610. FEDERAL RENEWABLE ELECTRICITY STANDARD.

    ``(a) Definitions.--For purposes of this section:
            ``(1) Biomass.--
                    ``(A) In general.--The term `biomass' means each of 
                the following:
                            ``(i) Cellulosic (plant fiber) organic 
                        materials from a plant that is planted for the 
                        purpose of being used to produce energy.
                            ``(ii) Nonhazardous, plant or algal matter 
                        that is derived from any of the following:
                                    ``(I) An agricultural crop, crop 
                                byproduct or residue resource.
                                    ``(II) Waste such as landscape or 
                                right-of-way trimmings (but not 
                                including municipal solid waste, 
                                recyclable postconsumer waste paper, 
                                painted, treated, or pressurized wood, 
                                wood contaminated with plastic or 
                                metals).
                            ``(iii) Animal waste or animal byproducts.
                            ``(iv) Landfill methane.
                    ``(B) National forest lands and certain other 
                public lands.--With respect to organic material removed 
                from National Forest System lands or from public lands 
                administered by the Secretary of the Interior, the term 
                `biomass' covers only organic material from (i) 
                ecological forest restoration; (ii) pre-commercial 
                thinnings; (iii) brush; (iv) mill residues; and (v) 
                slash.
                    ``(C) Exclusion of certain federal lands.--
                Notwithstanding subparagraph (B), material or matter 
                that would otherwise qualify as biomass are not 
                included in the term biomass if they are located on the 
                following Federal lands:
                            ``(i) Federal land containing old growth 
                        forest or late successional forest unless the 
                        Secretary of the Interior or the Secretary of 
                        Agriculture determines that the removal of 
                        organic material from such land is appropriate 
                        for the applicable forest type and maximizes 
                        the retention of late-successional and large 
                        and old growth trees, late-successional and old 
                        growth forest structure, and late-successional 
                        and old growth forest composition.
                            ``(ii) Federal land on which the removal of 
                        vegetation is prohibited, including components 
                        of the National Wilderness Preservation System.
                            ``(iii) Wilderness Study Areas.
                            ``(iv) Inventoried roadless areas.
                            ``(v) Components of the National Landscape 
                        Conservation System.
                            ``(vi) National Monuments.
            ``(2) Eligible facility.--The term `eligible facility' 
        means--
                    ``(A) a facility for the generation of electric 
                energy from a renewable energy resource that is placed 
                in service on or after January 1, 2001; or
                    ``(B) a repowering or cofiring increment.
            ``(3) Existing facility.--The term `existing facility' 
        means a facility for the generation of electric energy from a 
        renewable energy resource that is not an eligible facility.
            ``(4) Incremental hydropower.--The term `incremental 
        hydropower' means additional generation that is achieved from 
        increased efficiency or additions of capacity made on or after 
        January 1, 2001, or the effective date of an existing 
        applicable State renewable portfolio standard program at a 
        hydroelectric facility that was placed in service before that 
        date.
            ``(5) Indian land.--The term `Indian land' means--
                    ``(A) any land within the limits of any Indian 
                reservation, pueblo, or rancheria;
                    ``(B) any land not within the limits of any Indian 
                reservation, pueblo, or rancheria title to which was on 
                the date of enactment of this paragraph either held by 
                the United States for the benefit of any Indian tribe 
                or individual or held by any Indian tribe or individual 
                subject to restriction by the United States against 
                alienation;
                    ``(C) any dependent Indian community; or
                    ``(D) any land conveyed to any Alaska Native 
                corporation under the Alaska Native Claims Settlement 
                Act.
            ``(6) Indian tribe.--The term `Indian tribe' means any 
        Indian tribe, band, nation, or other organized group or 
        community, including any Alaskan Native village or regional or 
        village corporation as defined in or established pursuant to 
        the Alaska Native Claims Settlement Act (43 U.S.C. 1601 et 
        seq.), which is recognized as eligible for the special programs 
        and services provided by the United States to Indians because 
        of their status as Indians.
            ``(7) Renewable energy.--The term `renewable energy' means 
        electric energy generated by a renewable energy resource.
            ``(8) Renewable energy resource.--The term `renewable 
        energy resource' means solar, wind, ocean, tidal, geothermal 
        energy, biomass, landfill gas, incremental hydropower, or 
        hydrokinetic energy.
            ``(9) Repowering or cofiring increment.--The term 
        `repowering or cofiring increment' means--
                    ``(A) the additional generation from a modification 
                that is placed in service on or after January 1, 2001, 
                to expand electricity production at a facility used to 
                generate electric energy from a renewable energy 
                resource;
                    ``(B) the additional generation above the average 
                generation in the 3 years preceding the date of 
                enactment of this section at a facility used to 
                generate electric energy from a renewable energy 
                resource or to cofire biomass that was placed in 
                service before the date of enactment of this section: 
                or
                    ``(C) the portion of the electric generation from a 
                facility placed in service on or after January 1, 2001, 
                or a modification to a facility placed in service 
                before the date of enactment of this section made on or 
                after January 1, 2001, associated with cofiring 
                biomass.
            ``(10) Retail electric supplier.--(A) The term `retail 
        electric supplier' means a person that sells electric energy to 
        electric consumers (other than consumers in Hawaii) that sold 
        not less than 1,000,000 megawatt-hours of electric energy to 
        electric consumers for purposes other than resale during the 
        preceding calendar year. For purposes of this section, a person 
        that sells electric energy to electric consumers that, in 
        combination with the sales of any affiliate organized after the 
        date of enactment of this section, sells not less that 
        1,000,000 megawatt hours of electric energy to consumers for 
        purposes other than resale shall qualify as a retail electric 
        supplier. For purposes of this paragraph, sales by any person 
        to a parent company or to other affiliates of such person shall 
        not be treated as sales to electric consumers.
            ``(B) Such term does not include the United States, a State 
        or any political subdivision of a State, or any agency, 
        authority, or instrumentality of any one or more of the 
        foregoing, or a rural electric cooperative, except that a 
        political subdivision of a State, or an agency, authority, or 
        instrumentality of the United States, a State or a political 
        subdivision of a State, or a rural electric cooperative that 
        sells electric energy to electric consumers or any other entity 
        that sells electric energy to electric consumers that would not 
        otherwise qualify as a retail electric supplier shall be deemed 
        a retail electric supplier if such entity notifies the 
        Secretary that it voluntarily agrees to participate in the 
        Federal renewable electricity standard program.
            ``(11) Retail electric supplier's base amount.--The term 
        `retail electric supplier's base amount' means the total amount 
        of electric energy sold by the retail electric supplier, 
        expressed in terms of kilowatt hours, to electric customers for 
        purposes other than resale during the most recent calendar year 
        for which information is available, excluding--
                    ``(A) electric energy that is not incremental 
                hydropower generated by a hydroelectric facility; and
                    ``(B) electricity generated through the 
                incineration of municipal solid waste.
    ``(b) Compliance.--For each calendar year beginning in calendar 
year 2010, each retail electric supplier shall meet the requirements of 
subsection (c) by submitting to the Secretary, not later than April 1 
of the following calendar year, one or more of the following:
            ``(1) Federal renewable energy credits issued under 
        subsection (e).
            ``(2) Federal energy efficiency credits issued under 
        subsection (i), except that Federal energy efficiency credits 
        may not be used to meet more than 27 percent of the 
        requirements of subsection (c) in any calendar year. Energy 
        efficiency credits may only be used for compliance in a State 
        where the Governor has petitioned the Secretary pursuant to 
        subjection (i)(2).
            ``(3) Certification of the renewable energy generated and 
        electricity savings pursuant to the funds associated with State 
        compliance payments as specified in subsection (e)(3)(G).
            ``(4) Alternative compliance payments pursuant to 
        subsection (j).
    ``(c) Required Annual Percentage.--For calendar years 2010 through 
2039, the required annual percentage of the retail electric supplier's 
base amount that shall be generated from renewable energy resources, or 
otherwise credited towards such percentage requirement pursuant to 
subsection (d), shall be the percentage specified in the following 
table:

                                                        Required annual
``Calendar Years                                             percentage
        2010...................................................    2.75
        2011...................................................    2.75
        2012...................................................    3.75
        2013...................................................     4.5
        2014...................................................     5.5
        2015...................................................     6.5
        2016...................................................     7.5
        2017...................................................    8.25
        2018...................................................   10.25
        2019...................................................   12.25
        2020 and thereafter through 2039.......................      15
    ``(d) Renewable Energy and Energy Efficiency Credits.--(1) A retail 
electric supplier may satisfy the requirements of subsection (b)(1) 
through the submission of Federal renewable energy credits--
            ``(A) issued to the retail electric supplier under 
        subsection (e);
            ``(B) obtained by purchase or exchange under subsection (f) 
        or (g); or
            ``(C) borrowed under subsection (h).
    ``(2) A retail electric supplier may satisfy the requirements of 
subsection (b)(2) through the submission of Federal energy efficiency 
credits issued to the retail electric supplier obtained by purchase or 
exchange pursuant to subsection (i).
    ``(3) A Federal renewable energy credit may be counted toward 
compliance with subsection (b)(1) only once. A Federal energy 
efficiency credit may be counted toward compliance with subsection 
(b)(2) only once.
    ``(e) Issuance of Federal Renewable Energy Credits.--(1) The 
Secretary shall establish by rule, not later than 1 year after the date 
of enactment of this section, a program to verify and issue Federal 
renewable energy credits to generators of renewable energy, track their 
sale, exchange, and retirement and to enforce the requirements of this 
section. To the extent possible, in establishing such program, the 
Secretary shall rely upon existing and emerging State or regional 
tracking systems that issue and track non-Federal renewable energy 
credits.
    ``(2) An entity that generates electric energy through the use of a 
renewable energy resource may apply to the Secretary for the issuance 
of renewable energy credits. The applicant must demonstrate that the 
electric energy will be transmitted onto the grid or, in the case of a 
generation offset, that the electric energy offset would have otherwise 
been consumed on site. The application shall indicate--
            ``(A) the type of renewable energy resource used to produce 
        the electricity;
            ``(B) the location where the electric energy was produced; 
        and
            ``(C) any other information the Secretary determines 
        appropriate.
    ``(3)(A) Except as provided in subparagraphs (B), (C), and (D), the 
Secretary shall issue to a generator of electric energy one Federal 
renewable energy credit for each kilowatt hour of electric energy 
generated by the use of a renewable energy resource at an eligible 
facility.
    ``(B) For purpose of compliance with this section, Federal 
renewable energy credits for incremental hydropower shall be based, on 
the increase in average annual generation resulting from the efficiency 
improvements or capacity additions. The incremental generation shall be 
calculated using the same water flow information used to determine a 
historic average annual generation baseline for the hydroelectric 
facility and certified by the Secretary or the Federal Energy 
Regulatory Commission. The calculation of the Federal renewable energy 
credits for incremental hydropower shall not be based on any 
operational changes at the hydroelectric facility not directly 
associated with the efficiency improvements or capacity additions.
    ``(C) The Secretary shall issue 2 renewable energy credits for each 
kilowatt hour of electric energy generated and supplied to the grid in 
that calendar year through the use of a renewable energy resource at an 
eligible facility located on Indian land. For purposes of this 
paragraph, renewable energy generated by biomass cofired with other 
fuels is eligible for two credits only if the biomass was grown on such 
land.
    ``(D) For electric energy generated by a renewable energy resource 
at an on-site eligible facility no larger than one megawatt in capacity 
and used to offset part or all of the customer's requirements for 
electric energy, the Secretary shall issue 3 renewable energy credits 
to such customer for each kilowatt hour generated.
    ``(E) In the case of an on-site eligible facility on Indian land no 
more than 3 credits per kilowatt hour may be issued.
    ``(F) If both a renewable energy resource and a non-renewable 
energy resource are used to generate the electric energy, the Secretary 
shall issue the Federal renewable energy credits based on the 
proportion of the renewable energy resources used.
    ``(G) When a generator has sold electric energy generated through 
the use of a renewable energy resource to a retail electric supplier 
under a contract for power from an existing facility, and the contract 
has not determined ownership of the Federal renewable energy credits 
associated with such generation, the Secretary shall issue such Federal 
renewable energy credits to the retail electric supplier for the 
duration of the contract.
    ``(H) Payments made by a retail electricity supplier, directly or 
indirectly, to a State for compliance with a State renewable portfolio 
standard program, or for an alternative compliance mechanism, shall be 
valued at one credit per kilowatt hour for the purpose of subsection 
(b)(2) based on the amount of electric energy generation from renewable 
resources and electricity savings up to 27 percent of the utility's 
requirement that results from those payments.
    ``(f) Existing Facilities.--The Secretary shall ensure that a 
retail electric supplier that acquires Federal renewable energy credits 
associated with the generation of renewable energy from an existing 
facility may use such credits for purpose of its compliance with 
subsection (b)(1). Such credits may not be sold, exchanged, or 
transferred for the purpose of compliance by another retail electric 
supplier.
    ``(g) Renewable Energy Credit Trading.--(1) A Federal renewable 
energy credit, may be sold, transferred, or exchanged by the entity to 
whom issued or by any other entity who acquires the Federal renewable 
energy credit, except for those renewable energy credits from existing 
facilities. A Federal renewable energy credit for any year that is not 
submitted to satisfy the minimum renewable generation requirement of 
subsection (c) for that year may be carried forward for use pursuant to 
subsection (b)(1) within the next 3 years.
    ``(2) A federally owned or cooperatively owned utility, or a State 
or subdivision thereof, that is not a retail electric supplier that 
generates electric energy by the use of a renewable energy resource at 
an eligible facility may only sell, transfer or exchange a Federal 
renewable energy credit to a cooperatively owned utility or an agency, 
authority, or instrumentality of a State or political subdivision of a 
State that is a retail electric supplier that has acquired the electric 
energy associated with the credit.
    ``(3) The Secretary may delegate to an appropriate market-making 
entity the administration of a national tradeable renewable energy 
credit market and a national energy efficiency credit market for 
purposes of creating a transparent national market for the sale or 
trade of renewable energy credits and a transparent national market for 
the sale or trade of Federal energy efficiency credits.
    ``(h) Renewable Energy Credit Borrowing.--At any time before the 
end of calendar year 2012, a retail electric supplier that has reason 
to believe it will not be able to fully comply with subsection (b) 
may--
            ``(1) submit a plan to the Secretary demonstrating that the 
        retail electric supplier will earn sufficient Federal renewable 
        energy credits and Federal energy efficiency credits within the 
        next 3 calendar years which, when taken into account, will 
        enable the retail electric supplier to meet the requirements of 
        subsection (b) for calendar year 2012 and the subsequent 
        calendar years involved; and
            ``(2) upon the approval of the plan by the Secretary, apply 
        Federal renewable energy credits and Federal energy efficiency 
        credits that the plan demonstrates will be earned within the 
        next 3 calendar years to meet the requirements of subsection 
        (b) for each calendar year involved.
The retail electric supplier must repay all of the borrowed Federal 
renewable energy credits and Federal energy efficiency credits by 
submitting an equivalent number of Federal renewable energy credits and 
Federal energy efficiency credits, in addition to those otherwise 
required under subsection (b), by calendar year 2020 or any earlier 
deadlines specified in the approved plan. Failure to repay the borrowed 
Federal renewable energy credits and Federal energy efficiency credits 
shall subject the retail electric supplier to civil penalties under 
subsection (i) for violation of the requirements of subsection (b) for 
each calendar year involved.
    ``(i) Energy Efficiency Credits.--
            ``(1) Definitions.--In this subsection--
                    ``(A) Customer facility savings.--The term 
                `customer facility savings' means a reduction in end-
                use electricity at a facility of an end-use consumer of 
                electricity served by a retail electric supplier, as 
                compared to--
                            ``(i) consumption at the facility during a 
                        base year;
                            ``(ii) in the case of new equipment 
                        (regardless of whether the new equipment 
                        replaces existing equipment at the end of the 
                        useful life of the existing equipment), 
                        consumption by the new equipment of average 
                        efficiency; or
                            ``(iii) in the case of a new facility, 
                        consumption at a reference facility.
                    ``(B) Electricity savings.--The term `electricity 
                savings' means--
                            ``(i) customer facility savings of 
                        electricity consumption adjusted to reflect any 
                        associated increase in fuel consumption at the 
                        facility;
                            ``(ii) reductions in distribution system 
                        losses of electricity achieved by a retail 
                        electricity distributor, as compared to losses 
                        during the base years;
                            ``(iii) the output of new combined heat and 
                        power systems, to the extent provided under 
                        paragraph (5); and
                            ``(iv) recycled energy savings.
                    ``(C) Qualifying electricity savings.--The term 
                `qualifying electricity savings' means electricity 
                savings that meet the measurement and verification 
                requirements of paragraph (4).
                    ``(D) Recycled energy savings.--The term `recycled 
                energy savings' means a reduction in electricity 
                consumption that is attributable to electrical or 
                mechanical power, or both, produced by modifying an 
                industrial or commercial system that was in operation 
                before July 1, 2007, in order to recapture energy that 
                would otherwise be wasted.
            ``(2) Petition.--The Governor of a State may petition the 
        Secretary to allow up to 27 percent of the requirements of a 
        retail electric supplier under subsection (c) in the State to 
        be met by submitting Federal energy efficiency credits issued 
        pursuant to this subsection.
            ``(3) Issuance of credits.--(A) Upon petition by the 
        Governor, the Secretary shall issue energy efficiency credits 
        for electricity savings described in subparagraph (B) achieved 
        in States described in paragraph (2) in accordance with this 
        subsection.
            ``(B) In accordance with regulations promulgated by the 
        Secretary, the Secretary shall issue credits for--
                    ``(i) qualified electricity savings achieved by a 
                retail electric supplier in a calendar year; and
                    ``(ii) qualified electricity savings achieved by 
                other entities if--
                            ``(I) the measures used to achieve the 
                        qualifying electricity savings were installed 
                        or placed in operation by the entity seeking 
                        the credit or the designated agent of the 
                        entity; and
                            ``(II) no retail electric supplier paid a 
                        substantial portion of the cost of achieving 
                        the qualified electricity savings (unless the 
                        retail electric supplier has waived any 
                        entitlement to the credit).
            ``(4) Measurement and verification of electricity 
        savings.--Not later than June 30, 2009, the Secretary shall 
        promulgate regulations regarding the measurement and 
        verification of electricity savings under this subsection, 
        including regulations covering--
                    ``(A) procedures and standards for defining and 
                measuring electricity savings that will be eligible to 
                receive credits under paragraph (3), which shall--
                            ``(i) specify the types of energy 
                        efficiency and energy conservation that will be 
                        eligible for the credits;
                            ``(ii) require that energy consumption for 
                        customer facilities or portions of facilities 
                        in the applicable base and current years be 
                        adjusted, as appropriate, to account for 
                        changes in weather, level of production, and 
                        building area;
                            ``(iii) account for the useful life of 
                        electricity savings measures;
                            ``(iv) include specified electricity 
                        savings values for specific, commonly-used 
                        efficiency measures;
                            ``(v) specify the extent to which 
                        electricity savings attributable to measures 
                        carried out before the date of enactment of 
                        this section are eligible to receive credits 
                        under this subsection; and
                            ``(vi) exclude electricity savings that (I) 
                        are not properly attributable to measures 
                        carried out by the entity seeking the credit; 
                        or (II) have already been credited under this 
                        section to another entity;
                    ``(B) procedures and standards for third-party 
                verification of reported electricity savings; and
                    ``(C) such requirements for information, reports, 
                and access to facilities as may be necessary to carry 
                out this subsection.
            ``(5) Combined heat and power.--Under regulations 
        promulgated by the Secretary, the increment of electricity 
        output of a new combined heat and power system that is 
        attributable to the higher efficiency of the combined system 
        (as compared to the efficiency of separate production of the 
        electric and thermal outputs), shall be considered electricity 
        savings under this subsection.
    ``(j) Enforcement.--A retail electric supplier that does not comply 
with subsection (b) shall be liable for the payment of a civil penalty. 
That penalty shall be calculated on the basis of the number of 
kilowatt-hours represented by the retail electric supplier's failure to 
comply with subsection (b), multiplied by the lesser of 4.5 cents 
(adjusted for inflation for such calendar year, based on the Gross 
Domestic Product Implicit Price Deflator) or 300 percent of the average 
market value of Federal renewable energy credits and energy efficiency 
credits for the compliance period. Any such penalty shall be due and 
payable without demand to the Secretary as provided in the regulations 
issued under subsection (e).
    ``(k) Alternative Compliance Payments.--The Secretary shall accept 
payment equal to the lesser of:
            ``(1) 200 percent of the average market value of Federal 
        renewable energy credits and Federal energy efficiency credits 
        for the applicable compliance period; or
            ``(2) 2.5 cents per kilowatt hour adjusted on January 1 of 
        each year following calendar year 2006 based on the Gross 
        Domestic Product Implicit Price Deflator,
as a means of compliance under subsection (b)(4)
    ``(l) Information Collection.--The Secretary may collect the 
information necessary to verify and audit--
            ``(1) the annual renewable energy generation of any retail 
        electric supplier, Federal renewable energy credits submitted 
        by a retail electric supplier pursuant to subsection (b)(1) and 
        Federal energy efficiency credits submitted by a retail 
        electric supplier pursuant to subsection (b)(2);
            ``(2) annual electricity savings achieved pursuant to 
        subsection (i);
            ``(3) the validity of Federal renewable energy credits 
        submitted for compliance by a retail electric supplier to the 
        Secretary; and
            ``(4) the quantity of electricity sales of all retail 
        electric suppliers.
    ``(m) Environmental Savings Clause.--Incremental hydropower shall 
be subject to all applicable environmental laws and licensing and 
regulatory requirements.
    ``(n) State Programs.--(1) Nothing in this section diminishes any 
authority of a State or political subdivision of a State to--
            ``(A) adopt or enforce any law or regulation respecting 
        renewable energy or energy efficiency, including but not 
        limited to programs that exceed the required amount of 
        renewable energy or energy efficiency under this section, or
            ``(B) regulate the acquisition and disposition of Federal 
        renewable energy credits and Federal energy efficiency credits 
        by retail electric suppliers.
        No law or regulation referred to in subparagraph (A) shall 
        relieve any person of any requirement otherwise applicable 
        under this section. The Secretary, in consultation with States 
        having renewable energy programs and energy efficiency 
        programs, shall preserve the integrity of such State programs, 
        including programs that exceed the required amount of renewable 
        energy and energy efficiency under this section, and shall 
        facilitate coordination between the Federal program and State 
        programs.
    ``(2) In the rule establishing the program under this section, the 
Secretary shall incorporate common elements of existing renewable 
energy and energy efficiency programs, including State programs, to 
ensure administrative ease, market transparency, and effective 
enforcement. The Secretary shall work with the States to minimize 
administrative burdens and costs to retail electric suppliers.
    ``(o) Recovery of Costs.--An electric utility whose sales of 
electric energy are subject to rate regulation, including any utility 
whose rates are regulated by the Commission and any State regulated 
electric utility, shall not be denied the opportunity to recover the 
full amount of the prudently incurred incremental cost of renewable 
energy and energy efficiency obtained to comply with the requirements 
of subsection (b). For purposes of this subsection, the definitions in 
section 3 of this Act shall apply to the terms electric utility, State 
regulated electric utility, State agency, Commission, and State 
regulatory authority.
    ``(p) Program Review.--The Secretary shall enter into a contract 
with the National Academy of Sciences to conduct a comprehensive 
evaluation of all aspects of the program established under this 
section, within 8 years of enactment of this section. The study shall 
include an evaluation of--
            ``(1) the effectiveness of the program in increasing the 
        market penetration and lowering the cost of the eligible 
        renewable energy and energy efficiency technologies;
            ``(2) the opportunities for any additional technologies and 
        sources of renewable energy and energy efficiency emerging 
        since enactment of this section;
            ``(3) the impact on the regional diversity and reliability 
        of supply sources, including the power quality benefits of 
        distributed generation;
            ``(4) the regional resource development relative to 
        renewable potential and reasons for any under investment in 
        renewable resources; and
            ``(5) the net cost/benefit of the renewable electricity 
        standard to the national and State economies, including retail 
        power costs, economic development benefits of investment, 
        avoided costs related to environmental and congestion 
        mitigation investments that would otherwise have been required, 
        impact on natural gas demand and price, effectiveness of green 
        marketing programs at reducing the cost of renewable resources.
The Secretary shall transmit the results of the evaluation and any 
recommendations for modifications and improvements to the program to 
Congress not later than January 1, 2016.
    ``(q) State Renewable Energy and Energy Efficiency Account 
Program.--(1) There is established in the Treasury a State renewable 
energy and energy efficiency account program.
    ``(2) All money collected by the Secretary from the alternative 
compliance payments under subsection (k) shall be deposited into the 
State renewable energy and energy efficiency account established 
pursuant to this subsection.
    ``(3) Proceeds deposited in the State renewable energy and energy 
efficiency account shall be used by the Secretary, subject to annual 
appropriations, for a program to provide grants to the State agency 
responsible for administering a fund to promote renewable energy 
generation and energy efficiency for customers of the State, or an 
alternative agency designated by the State, or if no such agency 
exists, to the State agency developing State energy conservation plans 
under section 363 of the Energy Policy and Conservation Act (42 U.S.C. 
6322) for the purposes of promoting renewable energy production and 
providing energy assistance and weatherization services to low-income 
consumers.
    ``(4) The Secretary may issue guidelines and criteria for grants 
awarded under this subsection. At least 75 percent of the funds 
provided to each State shall be used for promoting renewable energy 
production and energy efficiency through grants, production incentives 
or other state-approved funding mechanisms. The funds shall be 
allocated to the States on the basis of retail electric sales subject 
to the Renewable electricity Standard under this section or through 
voluntary participation. State agencies receiving grants under this 
section shall maintain such records and evidence of compliance as the 
Secretary may require.''.
    (b) Table of Contents.--The table of contents for such title is 
amended by adding the following new item at the end:

``Sec. 610. Federal renewable electricity standard.''.
    (c) Sunset.--Section 610 of such title and the item relating to 
such section 610 in the table of contents for such title are each 
repealed as of December 31, 2039.

      TITLE VI--GREEN RESOURCES FOR ENERGY EFFICIENT NEIGHBORHOODS

SEC. 601. SHORT TITLE AND TABLE OF CONTENTS.

    This title may be cited as the ``Green Resources for Energy 
Efficient Neighborhoods Act of 2008'' or the ``GREEN Act of 2008''.

SEC. 602. DEFINITIONS.

    For purposes of this title, the following definitions shall apply:
            (1) Green building standards.--The term ``green building 
        standards'' means standards to require use of sustainable 
        design principles to reduce the use of nonrenewable resources, 
        encourage energy-efficient construction and rehabilitation and 
        the use of renewable energy resources, minimize the impact of 
        development on the environment, and improve indoor air quality.
            (2) HUD.--The term ``HUD'' means the Department of Housing 
        and Urban Development.
            (3) HUD assistance.--The term ``HUD assistance'' means 
        financial assistance that is awarded, competitively or 
        noncompetitively, allocated by formula, or provided by HUD 
        through loan insurance or guarantee.
            (4) Nonresidential structure.--The term ``nonresidential 
        structures'' means only nonresidential structures that are 
        appurtenant to single family or multifamily housing residential 
        structures, or those that are funded by the Secretary of 
        Housing and Urban Development through the HUD Community 
        Development Block Grant program.
            (5) Secretary.--The term ``Secretary'', unless otherwise 
        specified, means the Secretary of Housing and Urban 
        Development.

SEC. 603. IMPLEMENTATION OF ENERGY EFFICIENCY PARTICIPATION INCENTIVES 
              FOR HUD PROGRAMS.

    (a) In General.--Not later than 180 days after the date of the 
enactment of this Act, the Secretary shall issue such regulations as 
may be necessary to establish annual energy efficiency participation 
incentives to encourage participants in programs administered by the 
Secretary, including recipients under programs for which HUD assistance 
is provided, to achieve substantial improvements in energy efficiency.
    (b) Requirement for Appropriation of Funds.--The requirement under 
subsection (a) for the Secretary to provide annual energy efficiency 
participation incentives pursuant to the provisions of this title shall 
be subject to the annual appropriation of necessary funds.

SEC. 604. MINIMUM HUD ENERGY EFFICIENCY STANDARDS AND STANDARDS FOR 
              ADDITIONAL CREDIT.

    (a) Minimum HUD Standard.--
            (1) Residential structures.--A residential single family or 
        multifamily structure shall be considered to comply with the 
        energy efficiency requirements under this subsection if--
                    (A) the structure complies with the applicable 
                provisions of the American Society of Heating, 
                Refrigerating, and Air-Conditioning Engineers Standard 
                90.1-2007, as such standard or successor standard is in 
                effect for purposes of this section pursuant subsection 
                (c);
                    (B) the structure complies with the applicable 
                provisions of the 2006 International Energy 
                Conservation Code, as such standard or successor 
                standard is in effect for purposes of this section 
                pursuant subsection (c);
                    (C) in the case only of an existing structure, 
                where determined cost effective, the structure has 
                undergone rehabilitation or improvements, completed 
                after the date of the enactment of this Act, and the 
                energy consumption for the structure has been reduced 
                by at least 20 percent from the previous level of 
                consumption, as determined in accordance with energy 
                audits performed both before and after any 
                rehabilitation or improvements undertaken to reduce 
                such consumption; or
                    (D) the structure complies with the applicable 
                provisions of such other energy efficiency 
                requirements, standards, checklists, or ratings systems 
                as the Secretary may adopt and apply by regulation, as 
                may be necessary, for purposes of this section for 
                specific types of residential single family or 
                multifamily structures or otherwise, except that the 
                Secretary shall make a determination regarding whether 
                to adopt and apply any such requirements, standards, 
                checklists, or rating system for purposes of this 
                section not later than the expiration of the 180-day 
                period beginning upon the date of receipt of any 
                written request, made in such form as the Secretary 
                shall provide, for such adoption and application.
        In addition to compliance with any of subparagraphs (A) through 
        (D), the Secretary shall by regulation require, for any newly 
        constructed residential single family or multifamily structure 
        to be considered to comply with the energy efficiency 
        requirements under this subsection, that the structure have 
        appropriate electrical outlets with the facility and capacity 
        to recharge a standard electric passenger vehicle, including an 
        electric hybrid vehicle, where such vehicle would normally be 
        parked.
            (2) Nonresidential structures.--For purposes of this 
        section, the Secretary shall identify and adopt by regulation, 
        as may be necessary, energy efficiency requirements, standards, 
        checklists, or rating systems applicable to nonresidential 
        structures that are constructed or rehabilitated with HUD 
        assistance. A nonresidential structure shall be considered to 
        comply with the energy efficiency requirements under this 
        subsection if the structure complies with the applicable 
        provisions of any such energy efficiency requirements, 
        standards, checklist, or rating systems identified and adopted 
        by the Secretary pursuant to this paragraph, as such standards 
        are in effect for purposes of this section pursuant to 
        subsection (c).
    (b) Additional Credit for Compliance With Enhanced Energy 
Efficiency Standards.--
            (1) In general.--In addition to compliance with the energy 
        efficiency requirements under subsection (a), a residential or 
        nonresidential structure shall be considered to comply with the 
        enhanced energy efficiency and conservation standards or the 
        green building standards under this subsection, to the extent 
        that such structure complies with the applicable provisions of 
        the standards under paragraph (2) or (3), respectively (as such 
        standards are in effect for purposes of this section, pursuant 
        to subsection (c)), in a manner that is not required for 
        compliance with the energy efficiency requirements under 
        subsection (a) and subject to the Secretary's determination of 
        which standards are applicable to which structures.
            (2) Energy efficiency and conservation standards.--The 
        energy efficiency and conservation standards under this 
        paragraph are as follows:
                    (A) Residential structures.--With respect to 
                residential structures:
                            (i) New construction.--For new 
                        construction, the Energy Star standards 
                        established by the Environmental Protection 
                        Agency, as such standards are in effect for 
                        purposes of this subsection pursuant to 
                        subsection (c);
                            (ii) Existing structures.--For existing 
                        structures, a reduction in energy consumption 
                        from the previous level of consumption for the 
                        structure, as determined in accordance with 
                        energy audits performed both before and after 
                        any rehabilitation or improvements undertaken 
                        to reduce such consumption, that exceeds the 
                        reduction necessary for compliance with the 
                        energy efficiency requirement under subsection 
                        (a)(1)(C).
                    (B) Nonresidential structures.--With respect to 
                nonresidential structures, such energy efficiency and 
                conservation requirements, standards, checklists, or 
                rating systems for nonresidential structures as the 
                Secretary shall identify and adopt by regulation, as 
                may be necessary, for purposes of this paragraph.
            (3) Green building standards.--The green building standards 
        under this paragraph are as follows:
                    (A) The national Green Communities criteria 
                checklist for residential construction that provides 
                criteria for the design, development, and operation of 
                affordable housing, as such checklist or successor 
                checklist is in effect for purposes of this section 
                pursuant to subsection (c).
                    (B) The gold certification level for the LEED for 
                New Construction rating system, the LEED for Homes 
                rating system, the LEED for Core and Shell rating 
                system, as applicable, as such systems or successor 
                systems are in effect for purposes of this section 
                pursuant to subsection (c).
                    (C) The Green Globes assessment and rating system 
                of the Green Buildings Initiative.
                    (D) For manufactured housing, energy star rating 
                with respect to fixtures, appliances, and equipment in 
                such housing, as such standard or successor standard is 
                in effect for purposes of this section pursuant to 
                subsection (c).
                    (E) The National Green Building Standard, but such 
                standard shall apply for purposes of this paragraph 
                only--
                            (i) if such standard is ratified under the 
                        American National Standards Institute process;
                            (ii) upon expiration of the 180-day period 
                        beginning upon such ratification; and
                            (iii) if, during such 180-day period, the 
                        Secretary of Housing and Urban Development does 
                        not reject the applicability of such standard 
                        for purposes of this paragraph.
                    (F) Any other requirements, standards, checklists, 
                or rating systems for green building or sustainability 
                as the Secretary may identify and adopt by regulation, 
                as may be necessary for purposes of this paragraph, 
                except that the Secretary shall make a determination 
                regarding whether to adopt and apply any such 
                requirements, standards, checklist, or rating system 
                for purposes of this section not later than the 
                expiration of the 180-day period beginning upon date of 
                receipt of any written request, made in such form as 
                the Secretary shall provide, for such adoption and 
                application.
            (4) Green building.--For purposes of this subsection, the 
        term ``green building'' means, with respect to standards for 
        structures, standards to require use of sustainable design 
        principles to reduce the use of nonrenewable resources, 
        minimize the impact of development on the environment, and to 
        improve indoor air quality.
            (5) Energy audits.--The Secretary shall establish standards 
        and requirements for energy audits for purposes of paragraph 
        (2)(A)(ii) and, in establishing such standards, may consult 
        with any advisory committees established pursuant to section 
        605(c)(2) of this title.
    (c) Applicability and Updating of Standards.--
            (1) Applicability.--Except as provided in paragraph (2), 
        the requirements, standards, checklists, and rating systems 
        referred to in subsections (a) and (b) that are in effect for 
        purposes of this section are such requirements, standards, 
        checklists, and systems are as in existence upon the date of 
        the enactment of this Act.
            (2) Updating.--For purposes of this section, the Secretary 
        may adopt and apply by regulation, as may be necessary, future 
        amendments and supplements to, and editions of, the 
        requirements, standards, checklists, and rating systems 
        referred to in subsections (a) and (b).

SEC. 605. ENERGY EFFICIENCY AND CONSERVATION DEMONSTRATION PROGRAM FOR 
              MULTIFAMILY HOUSING PROJECTS ASSISTED WITH PROJECT-BASED 
              RENTAL ASSISTANCE.

    (a) Authority.--For multifamily housing projects for which project-
based rental assistance is provided under a covered multifamily 
assistance program, the Secretary shall, subject to the availability of 
amounts provided in advance in appropriation Acts, carry out a program 
to demonstrate the effectiveness of funding a portion of the costs of 
meeting the enhanced energy efficiency standards under section 604(b). 
At the discretion of the Secretary, the demonstration program may 
include incentives for housing that is assisted with Indian housing 
block grants provided pursuant to the Native American Housing 
Assistance and Self-Determination Act of 1996, but only to the extent 
that such inclusion does not violate such Act, its regulations, and the 
goal of such Act of tribal self-determination.
    (b) Goals.--The demonstration program under this section shall be 
carried out in a manner that--
            (1) protects the financial interests of the Federal 
        Government;
            (2) reduces the proportion of funds provided by the Federal 
        Government and by owners and residents of multifamily housing 
        projects that are used for costs of utilities for the projects;
            (3) encourages energy efficiency and conservation by owners 
        and residents of multifamily housing projects and installation 
        of renewable energy improvements, such as improvements 
        providing for use of solar, wind, geothermal, or biomass energy 
        sources;
            (4) creates incentives for project owners to carry out such 
        energy efficiency renovations and improvements by allowing a 
        portion of the savings in operating costs resulting from such 
        renovations and improvements to be retained by the project 
        owner, notwithstanding otherwise applicable limitations on 
        dividends;
            (5) promotes the installation, in existing residential 
        buildings, of energy-efficient and cost-effective improvements 
        and renewable energy improvements, such as improvements 
        providing for use of solar, wind, geothermal, or biomass energy 
        sources;
            (6) tests the efficacy of a variety of energy efficiency 
        measures for multifamily housing projects of various sizes and 
        in various geographic locations;
            (7) tests methods for addressing the various, and often 
        competing, incentives that impede owners and residents of 
        multifamily housing projects from working together to achieve 
        energy efficiency or conservation; and
            (8) creates a database of energy efficiency and 
        conservation, and renewable energy, techniques, energy savings 
        management practices, and energy efficiency and conservation 
        financing vehicles.
    (c) Approaches.--In carrying out the demonstration program under 
this section, the Secretary may--
            (1) enter into agreements with the Building America Program 
        of the Department of Energy and other consensus committees 
        under which such programs, partnerships, or committees assume 
        some or all of the functions, obligations, and benefits of the 
        Secretary with respect to energy savings;
            (2) establish advisory committees to advise the Secretary 
        and any such third party partners on technological and other 
        developments in the area of energy efficiency and the creation 
        of an energy efficiency and conservation credit facility and 
        other financing opportunities, which committees shall include 
        representatives of homebuilders, realtors, architects, 
        nonprofit housing organizations, environmental protection 
        organizations, renewable energy organizations, and advocacy 
        organizations for the elderly and persons with disabilities; 
        any advisory committees established pursuant to this paragraph 
        shall not be subject to the Federal Advisory Committee Act (5 
        U.S.C. App.);
            (3) approve, for a period not to exceed 10 years, 
        additional adjustments in the maximum monthly rents or 
        additional project rental assistance, or additional Indian 
        housing block grant funds under the Native American Housing 
        Assistance and Self-Determination Act of 1996, as applicable, 
        for dwelling units in multifamily housing projects that are 
        provided project-based rental assistance under a covered 
        multifamily assistance program, in such amounts as may be 
        necessary to amortize a portion of the cost of energy 
        efficiency and conservation measures for such projects;
            (4) develop a competitive process for the award of such 
        additional assistance for multifamily housing projects seeking 
        to implement energy efficiency, renewable energy sources, or 
        conservation measures; and
            (5) waive or modify any existing statutory or regulatory 
        provision that would otherwise impair the implementation or 
        effectiveness of the demonstration program under this section, 
        including provisions relating to methods for rent adjustments, 
        comparability standards, maximum rent schedules, and utility 
        allowances; notwithstanding the preceding provisions of this 
        paragraph, the Secretary may not waive any statutory 
        requirement relating to fair housing, nondiscrimination, labor 
        standards, or the environment, except pursuant to existing 
        authority to waive non-statutory environmental and other 
        applicable requirements.
    (d) Requirement.--During the 4-year period beginning 12 months 
after the date of the enactment of this Act, the Secretary shall carry 
out demonstration programs under this section with respect to not fewer 
than 50,000 dwelling units.
    (e) Selection.--
            (1) Scope.--In order to provide a broad and representative 
        profile for use in designing a program which can become 
        operational and effective nationwide, the Secretary shall carry 
        out the demonstration program under this section with respect 
        to dwelling units located in a wide variety of geographic areas 
        and project types assisted by the various covered multifamily 
        assistance programs and using a variety of energy efficiency 
        and conservation and funding techniques to reflect differences 
        in climate, types of dwelling units and technical and 
        scientific methodologies, and financing options. The Secretary 
        shall ensure that the geographic areas included in the 
        demonstration program include dwelling units on Indian lands 
        (as such term is defined in section 2601 of the Energy Policy 
        Act of 1992 (25 U.S.C. 3501), to the extent that dwelling units 
        on Indian land have the type of residential structures that are 
        the focus of the demonstration program.
            (2) Priority.--The Secretary shall provide priority for 
        selection for participation in the program under this section 
        based on the extent to which, as a result of assistance 
        provided, the project will comply with the energy efficiency 
        standards under subsection (a), (b), or (c) of section 604 of 
        this title.
    (f) Use of Existing Partnerships.--To the extent feasible, the 
Secretary shall--
            (1) utilize the Partnership for Advancing Technology in 
        Housing of the Department of Housing and Urban Development to 
        assist in carrying out the requirements of this section and to 
        provide education and outreach regarding the demonstration 
        program authorized under this section; and
            (2) consult with the Secretary of Energy, the Administrator 
        of the Environmental Protection Agency, and the Secretary of 
        the Army regarding utilizing the Building America Program of 
        the Department of Energy, the Energy Star Program, and the Army 
        Corps of Engineers, respectively, to determine the manner in 
        which they might assist in carrying out the goals of this 
        section and providing education and outreach regarding the 
        demonstration program authorized under this section.
    (g) Reports.--
            (1) Annual.--Not later than the expiration of the 2-year 
        beginning upon the date of the enactment of this Act, and for 
        each year thereafter during the term of the demonstration 
        program, the Secretary shall submit a report to the Congress 
        annually that describes and assesses the demonstration program 
        under this section.
            (2) Final.--Not later than six months after the expiration 
        of the 4-year period described in subsection (d), the Secretary 
        shall submit a final report to the Congress assessing the 
        demonstration program, which--
                    (A) shall assess the potential for expanding the 
                demonstration program on a nationwide basis; and
                    (B) shall include descriptions of--
                            (i) the size of each multifamily housing 
                        project for which assistance was provided under 
                        the program;
                            (ii) the geographic location of each 
                        project assisted, by State and region;
                            (iii) the criteria used to select the 
                        projects for which assistance is provided under 
                        the program;
                            (iv) the energy efficiency and conservation 
                        measures and financing sources used for each 
                        project that is assisted under the program;
                            (v) the difference, before and during 
                        participation in the demonstration program, in 
                        the amount of the monthly assistance payments 
                        under the covered multifamily assistance 
                        program for each project assisted under the 
                        program;
                            (vi) the average length of the term of the 
                        such assistance provided under the program for 
                        a project;
                            (vii) the aggregate amount of savings 
                        generated by the demonstration program and the 
                        amount of savings expected to be generated by 
                        the program over time on a per-unit and 
                        aggregate program basis;
                            (viii) the functions performed in 
                        connection with the implementation of the 
                        demonstration program that were transferred or 
                        contracted out to any third parties;
                            (ix) an evaluation of the overall successes 
                        and failures of the demonstration program; and
                            (x) recommendations for any actions to be 
                        taken as a result of the such successes and 
                        failures.
            (3) Contents.--Each annual report pursuant to paragraph (1) 
        and the final report pursuant to paragraph (2) shall include--
                    (A) a description of the status of each multifamily 
                housing project selected for participation in the 
                demonstration program under this section; and
                    (B) findings from the program and recommendations 
                for any legislative actions.
    (h) Covered Multifamily Assistance Program.--For purposes of this 
section, the term ``covered multifamily assistance program'' means--
            (1) the program under section 8 of the United States 
        Housing Act of 1937 (42 U.S.C. 1437f) for project-based rental 
        assistance;
            (2) the program under section 202 of the Housing Act of 
        1959 (12 U.S.C. 1701q) for assistance for supportive housing 
        for the elderly;
            (3) the program under section 811 of the Cranston-Gonzalez 
        National Affordable Housing Act (42 U.S.C. 8013) for supportive 
        housing for persons with disabilities; and
            (4) the program for assistance under the Native American 
        Housing Assistance and Self-Determination Act of 1996 (25 
        U.S.C. 4111).
    (i) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $50,000,000 for each fiscal year 
in which the demonstration program under this section is carried out.
    (j) Regulations.--Not later than the expiration of the 180-day 
period beginning on the date of the enactment of this Act, the 
Secretary shall issue any regulations necessary to carry out this 
section.

SEC. 606. ADDITIONAL CREDIT FOR FANNIE MAE AND FREDDIE MAC HOUSING 
              GOALS FOR ENERGY EFFICIENT MORTGAGES.

    Section 1336(a) of the Housing and Community Development Act of 
1992 (12 U.S.C. 4566(a)), as amended by the Federal Housing Finance 
Regulatory Reform Act of 2008 (Public Law 110-289; 122 Stat. 2654), is 
amended--
            (1) in paragraph (2), by striking ``paragraph (5)'' and 
        inserting ``paragraphs (5) and (6)''; and
            (2) by adding at the end the following new paragraph:
            ``(6) Additional credit.--
                    ``(A) In general.--In assigning credit toward 
                achievement under this section of the housing goals for 
                mortgage purchase activities of the enterprises, the 
                Director shall assign--
                            ``(i) more than 125 percent credit, for 
                        such purchases that both--
                                    ``(I) comply with the requirements 
                                of such goals; and
                                    ``(II) support housing that meets 
                                the energy efficiency standards under 
                                section 604(a) of the Green Resources 
                                for Energy Efficient Neighborhoods Act 
                                of 2008; and
                            ``(ii) credit in addition to credit under 
                        clause (i), for purchases that both--
                                    ``(I) comply with the requirements 
                                of such goals, and
                                    ``(II) support housing that 
                                complies with the enhanced energy 
                                efficiency and conservation standards, 
                                or the green building standards, under 
                                section 604(b) of such Act, or both,
                        and such additional credit shall be given based 
                        on the extent to which the housing supported 
                        with such purchases complies with such 
                        standards.
                    ``(B) Treatment of additional credit.--The 
                availability of additional credit under this paragraph 
                shall not be used to increase any housing goal, 
                subgoal, or target established under this subpart.''.

SEC. 607. DUTY TO SERVE UNDERSERVED MARKETS FOR ENERGY-EFFICIENT AND 
              LOCATION-EFFICIENT MORTGAGES.

    Section 1335 of Federal Housing Enterprises Financial Safety and 
Soundness Act of 1992 (12 U.S.C. 4565), as amended by the Federal 
Housing Finance Regulatory Reform Act of 2008 (Public Law 110-289; 122 
Stat. 2654), is amended--
            (1) in subsection (a)(1), by adding at the end the 
        following new subparagraph:
                    ``(D) Markets for energy-efficient and location-
                efficient mortgages.--
                            ``(i) Duty.--Subject to clause (ii), the 
                        enterprise shall develop loan products and 
                        flexible underwriting guidelines to facilitate 
                        a secondary market for energy-efficient and 
                        location-efficient mortgages on housing for 
                        very low-, low-, and moderate income families, 
                        and for second and junior mortgages made for 
                        purposes of energy efficiency or renewable 
                        energy improvements, or both.
                            ``(ii) Authority to suspend.--
                        Notwithstanding any other provision of this 
                        section, the Director may suspend the 
                        applicability of the requirement under clause 
                        (i) with respect to an enterprise, for such 
                        period as is necessary, if the Director 
                        determines that exigent circumstances exist and 
                        such suspension is appropriate to ensure the 
                        safety and soundness of the portfolio holdings 
                        of the enterprise.'';
            (2) by adding at the end the following new subsection:
    ``(e) Definitions.--For purposes of this section, the following 
definitions shall apply:
            ``(1) Energy-efficient mortgage.--The term `energy 
        efficient mortgage' means a mortgage loan under which the 
        income of the borrower, for purposes of qualification for such 
        loan, is considered to be increased by not less than $1 for 
        each $1 of savings projected to be realized by the borrower as 
        a result of cost-effective energy saving design, construction 
        or improvements (including use of renewable energy sources, 
        such as solar, geothermal, biomass, and wind, super-insulation, 
        energy-saving windows, insulating glass and film, and radiant 
        barrier) for the home for which the loan is made.
            ``(2) Location-efficient mortgage.--The term `location 
        efficient mortgage' means a mortgage loan under which--
                    ``(A) the income of the borrower, for purposes of 
                qualification for such loan, is considered to be 
                increased by not less than $1 for each $1 of savings 
                projected to be realized by the borrower because the 
                location of the home for which loan is made will result 
                in decreased transportation costs for the household of 
                the borrower; or
                    ``(B) the sum of the principal, interest, taxes, 
                and insurance due under the mortgage loan is decreased 
                by not less than $1 for each $1 of savings projected to 
                be realized by the borrower because the location of the 
                home for which loan is made will result in decreased 
                transportation costs for the household of the 
                borrower.''.

SEC. 608. CONSIDERATION OF ENERGY EFFICIENCY UNDER FHA MORTGAGE 
              INSURANCE PROGRAMS AND NATIVE AMERICAN AND NATIVE 
              HAWAIIAN LOAN GUARANTEE PROGRAMS.

    (a) FHA Mortgage Insurance.--
            (1) Requirement.--Title V of the National Housing Act is 
        amended by adding after section 542 (12 U.S.C. 1735f-20) the 
        following new section:

``SEC. 543. CONSIDERATION OF ENERGY EFFICIENCY.

    ``(a) Underwriting Standards.--The Secretary shall establish a 
method to consider, in its underwriting standards for mortgages on 
single-family housing meeting the energy efficiency standards under 
section 604(a) of the Green Resources for Energy Efficient 
Neighborhoods Act of 2008 that are insured under this Act, the impact 
that savings on utility costs has on the income of the mortgagor.
    ``(b) Goal.--It is the sense of the Congress that, in carrying out 
this Act, the Secretary should endeavor to insure mortgages on single-
family housing meeting the energy efficiency standards under section 
604(a) of the Green Resources for Energy Efficient Neighborhoods Act of 
2008 such that at least 50,000 such mortgages are insured during the 
period beginning upon the date of the enactment of such Act and ending 
on December 31, 2012.''.
            (2) Reporting on defaults.--Section 540(b) of the National 
        Housing Act (12 U.S.C. 1735f-18(b)) is amended by adding at the 
        end the following new paragraph:
            ``(3) With respect to each collection period that commences 
        after December 31, 2011, the total number of mortgages on 
        single-family housing meeting the energy efficiency standards 
        under section 604(a) of the Green Resources for Energy 
        Efficient Neighborhoods Act of 2008 that are insured by the 
        Secretary during the applicable collection period, the number 
        of defaults and foreclosures occurring on such mortgages during 
        such period, the percentage of the total of such mortgages 
        insured during such period on which defaults and foreclosure 
        occurred, and the rate for such period of defaults and 
        foreclosures on such mortgages compared to the overall rate for 
        such period of defaults and foreclosures on mortgages for 
        single-family housing insured under this Act by the 
        Secretary.''.
    (b) Indian Housing Loan Guarantees.--
            (1) Requirement.--Section 184 of the Housing and Community 
        Development Act of 1992 (12 U.S.C. 1715z-13a) is amended--
                    (A) by redesignating subsection (l) as subsection 
                (m); and
                    (B) by inserting after subsection (k) the following 
                new subsection:
    ``(l) Consideration of Energy Efficiency.--The Secretary shall 
establish a method to consider, in its underwriting standards for loans 
for single-family housing meeting the energy efficiency standards under 
section 604(a) of the Green Resources for Energy Efficient 
Neighborhoods Act of 2008 that are guaranteed under this section, the 
impact that savings on utility costs has on the income of the 
borrower.''.
            (2) Reporting on defaults.--Section 540(b) of the National 
        Housing Act (12 U.S.C. 1735f-18(b)), as amended by subsection 
        (a)(2) of this section, is further amended by adding at the end 
        the following new paragraph:
            ``(4) With respect to each collection period that commences 
        after December 31, 2011, the total number of loans guaranteed 
        under section 184 of the Housing and Community Development Act 
        of 1992 (12 U.S.C. 1715z-13a) on single-family housing meeting 
        the enhanced energy efficiency standards under section 604(a) 
        of the Green Resources for Energy Efficient Neighborhoods Act 
        of 2008 that are guaranteed by the Secretary during the 
        applicable collection period, the number of defaults and 
        foreclosures occurring on such loans during such period, the 
        percentage of the total of such loans guaranteed during such 
        period on which defaults and foreclosure occurred, and the rate 
        for such period of defaults and foreclosures on such loans 
        compared to the overall rate for such period of defaults and 
        foreclosures on loans for single-family housing guaranteed 
        under such section 184 by the Secretary.''.
    (c) Native Hawaiian Housing Loan Guarantees.--
            (1) Requirement.--Section 184A of the Housing and Community 
        Development Act of 1992 (12 U.S.C. 1715z-13b) is amended by 
        inserting after subsection (l) the following new subsection:
    ``(m) Energy-Efficient Housing Requirement.--The Secretary shall 
establish a method to consider, in its underwriting standards for loans 
for single-family housing meeting the energy efficiency standards under 
section 604(a) of the Green Resources for Energy Efficient 
Neighborhoods Act of 2008 that are guaranteed under this section, the 
impact that savings on utility costs has on the income of the 
borrower.''.
            (2) Reporting on defaults.--Section 540(b) of the National 
        Housing Act (12 U.S.C. 1735f-18(b)), as amended by the 
        preceding provisions of this section, is further amended by 
        adding at the end the following new paragraph:
            ``(5) With respect to each collection period that commences 
        after December 31, 2011, the total number of loans guaranteed 
        under section 184A of the Housing and Community Development Act 
        of 1992 (12 U.S.C. 1715z-13b) on single-family housing meeting 
        the enhanced energy efficiency standards under section 604(a) 
        of the Green Resources for Energy Efficient Neighborhoods Act 
        of 2008 that are guaranteed by the Secretary during the 
        applicable collection period, the number of defaults and 
        foreclosures occurring on such loans during such period, the 
        percentage of the total of such loans guaranteed during such 
        period on which defaults and foreclosure occurred, and the rate 
        for such period of defaults and foreclosures on such loans 
        compared to the overall rate for such period of defaults and 
        foreclosures on loans for single-family housing guaranteed 
        under such section 184A by the Secretary.''.

SEC. 609. ENERGY EFFICIENT MORTGAGES EDUCATION AND OUTREACH CAMPAIGN.

    Section 106 of the Energy Policy Act of 1992 (12 U.S.C. 1701z-16) 
is amended by adding at the end the following new subsection:
    ``(g) Education and Outreach Campaign.--
            ``(1) Development of energy-efficient mortgage outreach 
        program.--
                    ``(A) Commission.--The Secretary, in consultation 
                and coordination with the Secretary of Energy, the 
                Secretary of Education, the Secretary of Agriculture, 
                and the Administrator of the Environmental Protection 
                Agency, shall establish a commission to develop and 
                recommend model mortgage products and underwriting 
                guidelines that provide market-based incentives to 
                prospective home buyers, lenders, and sellers to 
                incorporate energy efficiency upgrades in new mortgage 
                loan transactions.
                    ``(B) Report.--Not later than 24 months after the 
                date of the enactment of the Green Resources for Energy 
                Efficient Neighborhoods Act of 2008, the Secretary 
                shall provide a written report to the Congress on the 
                results of work of the commission established pursuant 
                to subparagraph (A) and that identifies model mortgage 
                products and underwriting guidelines that may encourage 
                energy efficiency.
            ``(2) Implementation.--After submission of the report under 
        paragraph (1)(B), the Secretary, in consultation and 
        coordination with the Secretary of Energy, the Secretary of 
        Education, and the Administrator of the Environmental 
        Protection Agency, shall carry out a public awareness, 
        education, and outreach campaign based on the findings of the 
        commission established pursuant to paragraph (1) to inform and 
        educate residential lenders and prospective borrowers regarding 
        the availability, benefits, advantages, and terms of energy 
        efficient mortgages made available pursuant to this section, 
        energy efficient mortgages that meet the requirements of 
        section 1335 of the Housing and Community Development Act of 
        1992 (42 U.S.C. 4565), and other mortgages, including mortgages 
        for multifamily housing, that have energy improvement features 
        and to publicize such availability, benefits, advantages, and 
        terms. Such actions may include entering into a contract with 
        an appropriate entity to publicize and market such mortgages 
        through appropriate media.
            ``(3) Renewable energy home product expos.--The Congress 
        hereby encourages the Secretary of Housing and Urban 
        Development to work with appropriate entities to organize and 
        hold renewable energy expositions that provide an opportunity 
        for the public to view and learn about renewable energy 
        products for the home that are currently on the market.
            ``(4) Authorization of appropriations.--There is authorized 
        to be appropriated to the Secretary to carry out this 
        subsection $5,000,000 for each of fiscal years 2009 through 
        2012.''.

SEC. 610. COLLECTION OF INFORMATION ON ENERGY-EFFICIENT AND LOCATION 
              EFFICIENT MORTGAGES THROUGH HOME MORTGAGE DISCLOSURE ACT.

    (a) In General.--Section 304(b) of the Home Mortgage Disclosure Act 
of 1975 (12 U.S.C. 2803(b)) is amended--
            (1) in paragraph (3), by striking ``and'' at the end;
            (2) in paragraph (4), by striking the period at the end and 
        inserting a semicolon; and
            (3) by adding at the end the following new paragraphs:
            ``(5) the number and dollar amount of mortgage loans for 
        single-family housing and for multifamily housing that are 
        energy-efficient mortgages (as such term is defined in section 
        1335 of Housing and Community Development Act of 1992); and
            ``(6) the number and dollar amount of mortgage loans for 
        single-family housing and for multifamily housing that are 
        location-efficient mortgages (as such term is defined in 
        section 1335 of Housing and Community Development Act of 
        1992).''.
    (b) Applicability.--The amendment made by subsection (a) shall 
apply with respect to the first calendar year that begins after the 
expiration of the 30-day period beginning on the date of the enactment 
of this Act.

SEC. 611. ENSURING AVAILABILITY OF HOMEOWNERS INSURANCE FOR HOMES NOT 
              CONNECTED TO ELECTRICITY GRID.

    (a) In General.--In the case of any covered structure (as such term 
is defined in subsection (d)), it shall be unlawful for any insurer to 
deny homeowners insurance coverage for the structure, or to otherwise 
discriminate in the issuance, cancellation, amount of such coverage, or 
conditions of such coverage for the structure, based solely and without 
any additional actuarial risks upon the fact that the structure is not 
connected to, or able to receive electricity service from, any 
wholesale or retail electric power provider.
    (b) Consideration of Actuarial Risk.--Subsection (a) may not be 
construed to prevent any insurer from charging rates for homeowners 
insurance coverage for a structure that are based on a good faith 
actuarial analysis of the risk associated with the structure not being 
connected to, or able to receive electricity service from, any 
wholesale or retail electric power provide. Any good faith analysis of 
such risk shall include analysis of the manner in which electric power 
for the structure is provided.
    (c) Insuring Homes and Related Property in Indian Areas.--
Notwithstanding any other provision of law, covered structures located 
in Indian areas (as such term is defined in section 4 of the Native 
American Housing Assistance and Self-Determination Act of 1996 (25 
U.S.C. 4103)) and constructed or maintained using assistance, loan 
guarantees, or other authority under the Native American Housing 
Assistance and Self-Determination Act of 1996 may be insured by any 
tribally owned self-insurance risk pool approved by the Secretary of 
Housing and Urban Development.
    (d) Covered Structure.--For purposes of this section, the term 
``covered structure'' means a residential structure that--
            (1) consists of one to four dwelling units;
            (2) is provided power, heat, or electricity from renewable 
        energy sources (such as solar, wind, geothermal, or biomass) or 
        a fuel cell; and
            (3) is not connected to any wholesale or retail electrical 
        power grid.

SEC. 612. MORTGAGE INCENTIVES FOR ENERGY-EFFICIENT MULTIFAMILY HOUSING.

    (a) In General.--The Secretary of Housing and Urban Development 
shall establish incentives for increasing the energy efficiency of 
multifamily housing that is subject to a mortgage to be insured under 
title II of the National Housing Act (12 U.S.C. 1707 et seq.) so that 
the housing meets the energy efficiency standards under section 604(a) 
of this title and incentives to encourage compliance of such housing 
with the energy efficiency and conservation standards, and the green 
building standards, under section 604(b) of this title, to the extent 
that such incentives are based on the impact that savings on utility 
costs has on the operating costs of the housing, as determined by the 
Secretary.
    (b) Incentives.--Such incentives may include, for any such 
multifamily housing that complies with the energy efficiency standards 
under section 604(a)--
            (1) providing a discount on the chargeable premiums for the 
        mortgage insurance for such housing from the amount otherwise 
        chargeable for such mortgage insurance;
            (2) allowing mortgages to exceed the dollar amount limits 
        otherwise applicable under law to the extent such additional 
        amounts are used to finance improvements or measures designed 
        to meet the standards referred to in subsection (a); and
            (3) reducing the amount that the owner of such multifamily 
        housing meeting the standards referred to in subsection (a) is 
        required to contribute.

SEC. 613. ENERGY EFFICIENCY CERTIFICATIONS FOR HOUSING WITH MORTGAGES 
              INSURED BY FHA.

    Section 526 of the National Housing Act (12 U.S.C. 1735f-4(a)) is 
amended--
            (1) in subsection (a)--
                    (A) by striking ``, other than manufactured 
                homes,'' each place such term appears;
                    (B) by inserting after the period at the end the 
                following: ``The energy performance requirements 
                developed and established by the Secretary under this 
                section for manufactured homes shall require energy 
                star rating for wall fixtures, appliances, and 
                equipment in such housing.'';
                    (C) by inserting ``(1)'' after ``(a)''; and
                    (D) by adding at the end the following new 
                paragraphs:
    ``(2) The Secretary shall require, with respect to any single- or 
multi-family residential housing subject to a mortgage insured under 
this Act, that any approval or certification of the housing for meeting 
any energy efficiency or conservation criteria, standards, or 
requirements pursuant to this title and any approval or certification 
required pursuant to this title with respect to energy conserving 
improvements or any renewable energy sources, such as wind, solar 
energy geothermal, or biomass, shall be conducted only by an individual 
certified by a home energy rating system provider who has been 
accredited to conduct such ratings by the Home Energy Ratings System 
Council, the Residential Energy Services Network, or such other 
appropriate national organization, as the Secretary may provide, or by 
licensed professional architect or engineer. If any organization makes 
a request to the Secretary for approval to accredit individuals to 
conduct energy efficiency or conservation ratings, the Secretary shall 
review and approve or disapprove such request not later than the 
expiration of the 6-month period beginning upon receipt of such 
request.
    ``(3) The Secretary shall periodically examine the method used to 
conduct inspections for compliance with the requirements under this 
section, analyze various other approaches for conducting such 
inspections, and review the costs and benefits of the current method 
compared with other methods.''; and
            (2) in subsection (b), by striking ``, other than a 
        manufactured home,''.

SEC. 614. ASSISTED HOUSING ENERGY LOAN PILOT PROGRAM.

    (a) Authority.--Not later than the expiration of the 12-month 
period beginning on the date of the enactment of this Act, the 
Secretary shall develop and implement a pilot program under this 
section to facilitate the financing of cost-effective capital 
improvements for covered assisted housing projects to improve the 
energy efficiency and conservation of such projects.
    (b) Loans.--The pilot program under this section shall involve not 
less than three and not more than five lenders, and shall provide for a 
privately financed loan to be made for a covered assisted housing 
project, which shall--
            (1) finance capital improvements for the project that meet 
        such requirements as the Secretary shall establish, and may 
        involve contracts with third parties to perform such capital 
        improvements, including the design of such improvements by 
        licensed professional architects or engineers;
            (2) have a term to maturity of not more than 20 years, 
        which shall be based upon the duration necessary to realize 
        cost savings sufficient to repay the loan;
            (3) be secured by a mortgage subordinate to the mortgage 
        for the project that is insured under the National Housing Act; 
        and
            (4) provide for a reduction in the remaining principal 
        obligation under the loan based on the actual resulting cost 
        savings realized from the capital improvements financed with 
        the loan.
    (c) Underwriting Standards.--The Secretary shall establish 
underwriting requirements for loans made under the pilot program under 
this section, which shall--
            (1) require the cost savings projected to be realized from 
        the capital improvements financed with the loan, during the 
        term of the loan, to exceed the costs of repaying the loan;
            (2) allow the designer or contractor involved in designing 
        capital improvements to be financed with a loan under the 
        program to carry out such capital improvements; and
            (3) include such energy, audit, property, financial, 
        ownership, and approval requirements as the Secretary considers 
        appropriate.
    (d) Treatment of Savings.--The pilot program under this section 
shall provide that the project owner shall receive the full financial 
benefit from any reduction in the cost of utilities resulting from 
capital improvements financed with a loan made under the program.
    (e) Covered Assisted Housing Projects.--For purposes of this 
section, the term ``covered assisted housing project'' means a housing 
project that--
            (1) is financed by a loan or mortgage that is--
                    (A) insured by the Secretary under subsection 
                (d)(3) or (d)(4) of section 221 of the National Housing 
                Act (12 U.S.C. 1715l), and bears interest at a rate 
                determined under the proviso of section 221(d)(5) of 
                such Act; or
                    (B) insured or assisted under section 236 of the 
                National Housing Act (12 U.S.C. 1715z-1);
            (2) at the time a loan under this section is made, is 
        provided project-based rental assistance under section 8 of the 
        United States Housing Act of 1937 (42 U.S.C. 1437f) for 50 
        percent or more of the dwelling units in the project; and
            (3) is not a housing project owned or held by the 
        Secretary, or subject to a mortgage held by the Secretary.

SEC. 615. RESIDENTIAL ENERGY EFFICIENCY BLOCK GRANT PROGRAM.

    Title I of the Housing and Community Development Act of 1974 (42 
U.S.C. 5301 et seq.) is amended by adding at the end the following new 
section:

``SEC. 123. RESIDENTIAL ENERGY EFFICIENCY BLOCK GRANT PROGRAM.

    ``(a) In General.--To the extent amounts are made available for 
grants under this section, the Secretary shall make grants under this 
section to States, metropolitan cities and urban counties, Indian 
tribes, and insular areas to carry out energy efficiency improvements 
in new and existing single-family and multifamily housing.
    ``(b) Allocations.--
            ``(1) In general.--Of the total amount made available for 
        each fiscal year for grants under this section that remains 
        after reserving amounts pursuant to paragraph (2), the 
        Secretary shall allocate for insular areas, for metropolitan 
        cities and urban counties, and for States, an amount that bears 
        the same ratio to such total amount as the amount allocated for 
        such fiscal year under section 106 for Indian tribes, for 
        insular areas, for metropolitan cities and urban counties, and 
        for States, respectively, bears to the total amount made 
        available for such fiscal year for grants under section 106.
            ``(2) Set aside for indian tribes.--Of the total amount 
        made available for each fiscal year for grants under this 
        section, the Secretary shall allocate not less than one percent 
        to Indian tribes.
    ``(c) Grant Amounts.--
            ``(1) Entitlement communities.--From the amounts allocated 
        pursuant to subsection (b) for metropolitan cities and urban 
        counties for each fiscal year, the Secretary shall make a grant 
        for such fiscal year to each metropolitan city and urban county 
        that complies with the requirement under subsection (d), in the 
        amount that bears the same ratio such total amount so allocated 
        as the amount of the grant for such fiscal year under section 
        106 for such metropolitan city or urban county bears to the 
        aggregate amount of all grants for such fiscal year under 
        section 106 for all metropolitan cities and urban counties.
            ``(2) States.--From the amounts allocated pursuant to 
        subsection (b) for States for each fiscal year, the Secretary 
        shall make a grant for such fiscal year to each State that 
        complies with the requirement under subsection (d), in the 
        amount that bears the same ratio such total amount so allocated 
        as the amount of the grant for such fiscal year under section 
        106 for such State bears to the aggregate amount of all grants 
        for such fiscal year under section 106 for all States. Grant 
        amounts received by a State shall be used only for eligible 
        activities under subsection (e) carried out in nonentitlement 
        areas of the State.
            ``(3) Indian tribes.--From the amounts allocated pursuant 
        to subsection (b) for Indian tribes, the Secretary shall make 
        grants to Indian tribes that comply with the requirement under 
        subsection (d) on the basis of a competition conducted pursuant 
        to specific criteria, as the Secretary shall establish by 
        regulation, for the selection of Indian tribes to receive such 
        amount.
            ``(4) Insular areas.--From the amounts allocated pursuant 
        to subsection (b) for insular areas, the Secretary shall make a 
        grant to each insular area that complies with the requirement 
        under subsection (d) on the basis of the ratio of the 
        population of the insular area to the aggregate population of 
        all insular areas. In determining the distribution of amounts 
        to insular areas, the Secretary may also include other 
        statistical criteria as data become available from the Bureau 
        of Census of the Department of Labor, but only if such criteria 
        are set forth by regulation issued after notice and an 
        opportunity for comment.
    ``(d) Statement of Activities.--
            ``(1) Requirement.--Before receipt the receipt in any 
        fiscal year of a grant under subsection (c) by any grantee, the 
        grantee shall have prepared a final statement of housing energy 
        efficiency objectives and projected use of funds as the 
        Secretary shall require and shall have provided the Secretary 
        with such certifications regarding such objectives and use as 
        the Secretary may require. In the case of metropolitan cities, 
        urban counties, units of general local government, and insular 
        areas receiving grants, the statement of projected use of funds 
        shall consist of proposed housing energy efficiency activities. 
        In the case of States receiving grants, the statement of 
        projected use of funds shall consist of the method by which the 
        States will distribute funds to units of general local 
        government.
            ``(2) Public participation.--The Secretary may establish 
        requirements to ensure the public availability of information 
        regarding projected use of grant amounts and public 
        participation in determining such projected use.
    ``(e) Eligible Activities.--
            ``(1) Requirement.--Amounts from a grant under this section 
        may be used only to carry out activities for single-family or 
        multifamily housing that are designed to improve the energy 
        efficiency of the housing so that the housing complies with the 
        energy efficiency standard under section 604(a) of the Green 
        Resources for Energy Efficient Neighborhoods Act of 2008, 
        including such activities to provide energy for such housing 
        from renewable sources, such as wind, waves, solar, biomass, 
        and geothermal sources.
            ``(2) Preference for compliance beyond minimum 
        requirements.--In selecting activities to be funded with 
        amounts from a grant under this section, a grantee shall give 
        more preference to activities based on the extent to which the 
        activities will result in compliance by the housing with the 
        enhanced energy efficiency and conservation standards, and the 
        green building standards, under section 604(b) of such Act.
    ``(f) Reports.--Each grantee of a grant under this section for a 
fiscal year shall submit to the Secretary, at a time determined by the 
Secretary, a performance and evaluation report concerning the use of 
grant amounts, which shall contain an assessment by the grantee of the 
relationship of such use to the objectives identified in the grantees 
statement under subsection (d).
    ``(g) Applicability of CDBG Provisions.--Sections 109, 110, and 111 
of the Housing and Community Development Act of 1974 (42 U.S.C. 5309, 
5310, 5311) shall apply to assistance received under this section to 
the same extent and in the same manner that such sections apply to 
assistance received under title I of such Act.
    ``(h) Authorization of Appropriations.--There is authorized to be 
appropriated for grants under this section $2,500,000,000 for fiscal 
year 2009 and such sums as may be necessary for each fiscal year 
thereafter.''.

SEC. 616. INCLUDING SUSTAINABLE DEVELOPMENT IN COMPREHENSIVE HOUSING 
              AFFORDABILITY STRATEGIES.

    Section 105(b) of the Cranston-Gonzalez National Affordable Housing 
Act (42 U.S.C. 12705(b)) is amended--
            (1) by striking ``and'' at the end of paragraph (19);
            (2) by striking the period at the end of paragraph (20) and 
        inserting ``; and'';
            (3) and by inserting after paragraph (20) the following:
            ``(21) describe the jurisdiction's strategies to encourage 
        sustainable development for affordable housing, including 
        single-family and multifamily housing, as measured by--
                    ``(A) greater energy efficiency and use of 
                renewable energy sources, including any strategies 
                regarding compliance with the energy efficiency 
                requirements under section 604(a) of the Green 
                Resources for Energy Efficient Neighborhoods Act of 
                2008 and with the enhanced energy efficiency and 
                conservation standards, and the green building 
                standards, under section 604(b) of such Act;
                    ``(B) increased conservation, recycling, and reuse 
                of resources;
                    ``(C) more effective use of existing 
                infrastructure;
                    ``(D) use of building materials and methods that 
                are healthier for residents of the housing, including 
                use of building materials that are free of added known 
                carcinogens that are classified as Group 1 Known 
                Carcinogens by the International Agency for Research on 
                Cancer; and
                    ``(E) such other criteria as the Secretary 
                determines, in consultation with the Secretary of 
                Energy, the Secretary of Agriculture, and the 
                Administrator of the Environmental Protection Agency, 
                are in accordance with the purposes of this 
                paragraph.''.

SEC. 617. GRANT PROGRAM TO INCREASE SUSTAINABLE LOW-INCOME COMMUNITY 
              DEVELOPMENT CAPACITY.

    (a) In General.--The Secretary may make grants to nonprofit 
organizations to use for any of the following purposes:
            (1) Training, educating, supporting, or advising an 
        eligible community development organization or qualified youth 
        service and conservation corps in improving energy efficiency, 
        resource conservation and reuse, design strategies to maximize 
        energy efficiency, installing or constructing renewable energy 
        improvements (such as wind, wave, solar, biomass, and 
        geothermal energy sources), and effective use of existing 
        infrastructure in affordable housing and economic development 
        activities in low-income communities, taking into consideration 
        energy efficiency requirements under section 604(a) of this 
        title and with the enhanced energy efficiency and conservation 
        standards, and the green building standards, under section 
        604(b) of this title.
            (2) Providing loans, grants, or predevelopment assistance 
        to eligible community development organizations or qualified 
        youth service and conservation corps to carry out energy 
        efficiency improvements that comply with the energy efficiency 
        requirements under section 604(a) of this title, resource 
        conservation and reuse, and effective use of existing 
        infrastructure in affordable housing and economic development 
        activities in low-income communities. In providing assistance 
        under this paragraph, the Secretary shall give more preference 
        to activities based on the extent to which the activities will 
        result in compliance with the enhanced energy efficiency and 
        conservation standards, and the green building standards, under 
        section 604(b) of this title.
            (3) Such other purposes as the Secretary determines are in 
        accordance with the purposes of this subsection.
    (b) Application Requirement.--To be eligible for a grant under this 
section, a nonprofit organization shall prepare and submit to the 
Secretary an application at such time, in such manner, and containing 
such information as the Secretary may require.
    (c) Award of Contracts.--Contracts for architectural or engineering 
services funded with amounts from grants made under this section shall 
be awarded in accordance with chapter 11 of title 40, United States 
Code (relating to selection of architects and engineers).
    (d) Matching Requirement.--A grant made under this section may not 
exceed the amount that the nonprofit organization receiving the grant 
certifies, to the Secretary, will be provided (in cash or in kind) from 
non-governmental sources to carry out the purposes for which the grant 
is made.
    (e) Definitions.--For purposes of this section, the following 
definitions shall apply:
            (1) The term ``nonprofit organization'' has the meaning 
        given such term in section 104 of the Cranston-Gonzalez 
        National Affordable Housing Act (42 U.S.C. 12704).
            (2) The term ``eligible community development 
        organization'' means--
                    (A) a unit of general local government (as defined 
                in section 104 of the Cranston-Gonzalez National 
                Affordable Housing Act (42 U.S.C. 12704));
                    (B) a community housing development organization 
                (as defined in section 104 of the Cranston-Gonzalez 
                National Affordable Housing Act (42 U.S.C. 12704));
                    (C) an Indian tribe or tribally designated housing 
                entity (as such terms are defined in section 4 of the 
                Native American Housing Assistance and Self-
                Determination Act of 1996 (25 U.S.C. 4103)); or
                    (D) a public housing agency, as such term is 
                defined in section 3(b) of the United States Housing 
                Act of 1937 (42 U.S.C. 1437(b)).
            (3) The term ``low-income community'' means a census tract 
        in which 50 percent or more of the households have an income 
        which is less than 80 percent of the greater of--
                    (A) the median gross income for such year for the 
                area in which such census tract is located; or
                    (B) the median gross income for such year for the 
                State in which such census tract is located.
    (f) Authorization of Appropriations.--There are authorized to be 
appropriated to the Secretary to carry out this section $10,000,000 for 
each of fiscal years 2008 through 2012.

SEC. 618. UTILIZATION OF ENERGY PERFORMANCE CONTRACTS IN HOPE VI.

    Section 24(d) of the United States Housing Act of 1937 (42 U.S.C. 
1437v(d)) is amended by adding at the end the following new paragraph:
            ``(3) Energy performance contracts.--
                    ``(A) In general.--The Secretary shall provide that 
                a public housing agency shall receive the full 
                financial benefit, as determined by the Secretary, from 
                any reduction in the cost of utilities resulting from 
                any contract with a third party to undertake energy 
                conservation improvements in connection with a 
                revitalization plan under this section.
                    ``(B) Third party contracts.--Contracts described 
                in subparagraph (A) may include contracts for equipment 
                conversions to less costly utility sources, projects 
                with resident-paid utilities, and adjustments to frozen 
                base year consumption, including systems repaired to 
                meet applicable building and safety codes and 
                adjustments for occupancy rates increased by 
                rehabilitation.
                    ``(C) Term of contract.--The total term of a 
                contract described in subparagraph (A) shall not exceed 
                20 years to allow longer payback periods for retrofits, 
                including windows, heating system replacements, wall 
                insulation, site-based generation, advanced energy 
                savings technologies, including renewable energy 
                generation, and other such retrofits.''.

SEC. 619. HOPE VI GREEN DEVELOPMENTS REQUIREMENT.

    (a) Mandatory Component.--Section 24(e) of the United States 
Housing Act of 1937 (42 U.S.C. 1437v(e)) is amended by adding at the 
end the following new paragraph:
            ``(4) Green developments requirement.--
                    ``(A) Requirement.--The Secretary may not make a 
                grant under this section to an applicant unless the 
                proposed revitalization plan of the applicant to be 
                carried out with such grant amounts meets the following 
                requirements:
                            ``(i) Green communities criteria 
                        checklist.--All residential construction under 
                        the proposed plan complies with the national 
                        Green Communities criteria checklist for 
                        residential construction that provides criteria 
                        for the design, development, and operation of 
                        affordable housing, as such checklist is in 
                        effect for purposes of this paragraph pursuant 
                        to subparagraph (D) at the date of the 
                        application for the grant, or any substantially 
                        equivalent standard or standards as determined 
                        by the Secretary, as follows:
                                    ``(I) The proposed plan shall 
                                comply with all items of the national 
                                Green Communities criteria checklist 
                                for residential construction that are 
                                identified as mandatory.
                                    ``(II) The proposed plan shall 
                                comply with such other nonmandatory 
                                items of such national Green 
                                Communities criteria checklist so as to 
                                result in a cumulative number of points 
                                attributable to such nonmandatory items 
                                under such checklist of not less than--
                                            ``(aa) 25 points, in the 
                                        case of any proposed plan (or 
                                        portion thereof) consisting of 
                                        new construction; and
                                            ``(bb) 20 points, in the 
                                        case of any proposed plan (or 
                                        portion thereof) consisting of 
                                        rehabilitation.
                            ``(ii) Green buildings certification 
                        system.--All non-residential construction under 
                        the proposed plan complies with all minimum 
                        required levels of the green building rating 
                        systems and levels identified by the Secretary 
                        pursuant to subparagraph (C), as such systems 
                        and levels are in effect for purposes of this 
                        paragraph pursuant to subparagraph (D) at the 
                        time of the application for the grant.
                    ``(B) Verification.--
                            ``(i) In general.--The Secretary shall 
                        verify, or provide for verification, sufficient 
                        to ensure that each proposed revitalization 
                        plan carried out with amounts from a grant 
                        under this section complies with the 
                        requirements under subparagraph (A) and that 
                        the revitalization plan is carried out in 
                        accordance with such requirements and plan.
                            ``(ii) Timing.--In providing for such 
                        verification, the Secretary shall establish 
                        procedures to ensure such compliance with 
                        respect to each grantee, and shall report to 
                        the Congress with respect to the compliance of 
                        each grantee, at each of the following times:
                                    ``(I) Not later than 6 months after 
                                execution of the grant agreement under 
                                this section for the grantee.
                                    ``(II) Upon completion of the 
                                revitalization plan of the grantee.
                    ``(C) Identification of green buildings rating 
                systems and levels.--
                            ``(i) In general.--For purposes of this 
                        paragraph, the Secretary shall identify rating 
                        systems and levels for green buildings that the 
                        Secretary determines to be the most likely to 
                        encourage a comprehensive and environmentally-
                        sound approach to ratings and standards for 
                        green buildings. The identification of the 
                        ratings systems and levels shall be based on 
                        the criteria specified in clause (ii), shall 
                        identify the highest levels the Secretary 
                        determines are appropriate above the minimum 
                        levels required under the systems selected. 
                        Within 90 days of the completion of each study 
                        required by clause (iii), the Secretary shall 
                        review and update the rating systems and 
                        levels, or identify alternative systems and 
                        levels for purposes of this paragraph, taking 
                        into account the conclusions of such study.
                            ``(ii) Criteria.--In identifying the green 
                        rating systems and levels, the Secretary shall 
                        take into consideration--
                                    ``(I) the ability and availability 
                                of assessors and auditors to 
                                independently verify the criteria and 
                                measurement of metrics at the scale 
                                necessary to implement this paragraph;
                                    ``(II) the ability of the 
                                applicable ratings system organizations 
                                to collect and reflect public comment;
                                    ``(III) the ability of the 
                                standards to be developed and revised 
                                through a consensus-based process;
                                    ``(IV) An evaluation of the 
                                robustness of the criteria for a high-
                                performance green building, which shall 
                                give credit for promoting--
                                            ``(aa) efficient and 
                                        sustainable use of water, 
                                        energy, and other natural 
                                        resources;
                                            ``(bb) use of renewable 
                                        energy sources;
                                            ``(cc) improved indoor and 
                                        outdoor environmental quality 
                                        through enhanced indoor and 
                                        outdoor air quality, thermal 
                                        comfort, acoustics, outdoor 
                                        noise pollution, day lighting, 
                                        pollutant source control, 
                                        sustainable landscaping, and 
                                        use of building system controls 
                                        and low- or no-emission 
                                        materials, including preference 
                                        for materials with no added 
                                        carcinogens that are classified 
                                        as Group 1 Known Carcinogens by 
                                        the International Agency for 
                                        Research on Cancer; and
                                            ``(dd) such other criteria 
                                        as the Secretary determines to 
                                        be appropriate; and
                                    ``(V) national recognition within 
                                the building industry.
                            ``(iii) 5-year evaluation.--At least once 
                        every five years, the Secretary shall conduct a 
                        study to evaluate and compare available third-
                        party green building rating systems and levels, 
                        taking into account the criteria listed in 
                        clause (ii).
                    ``(D) Applicability and updating of standards.--
                            ``(i) Applicability.--Except as provided in 
                        clause (ii) of this subparagraph, the national 
                        Green Communities criteria checklist and green 
                        building rating systems and levels referred to 
                        in clauses (i) and (ii) of subparagraph (A) 
                        that are in effect for purposes of this 
                        paragraph are such checklist systems, and 
                        levels as in existence upon the date of the 
                        enactment of the Green Resources for Energy 
                        Efficient Neighborhoods Act of 2008.
                            ``(ii) Updating.--The Secretary may, by 
                        regulation, adopt and apply, for purposes of 
                        this paragraph, future amendments and 
                        supplements to, and editions of, the national 
                        Green Communities criteria checklist, any 
                        standard or standards that the Secretary has 
                        determined to be substantially equivalent to 
                        such checklist, and the green building ratings 
                        systems and levels identified by the Secretary 
                        pursuant to subparagraph (C).''.
    (b) Selection Criteria; Graded Component.--Section 24(e)(2) of the 
United States Housing Act of 1937 (42 U.S.C. 1437v(e)(2)) is amended--
            (1) in subparagraph (K), by striking ``and'' at the end;
            (2) by redesignating subparagraph (L) as subparagraph (M); 
        and
            (3) by inserting after subparagraph (K) the following new 
        subparagraph:
                    ``(L) the extent to which the proposed 
                revitalization plan--
                            ``(i) in the case of residential 
                        construction, complies with the nonmandatory 
                        items of the national Green Communities 
                        criteria checklist identified in paragraph 
                        (4)(A)(i), or any substantially equivalent 
                        standard or standards as determined by the 
                        Secretary, but only to the extent such 
                        compliance exceeds the compliance necessary to 
                        accumulate the number of points required under 
                        such paragraph; and
                            ``(ii) in the case of non-residential 
                        construction, complies with the components of 
                        the green building rating systems and levels 
                        identified by the Secretary pursuant to 
                        paragraph (4)(C), but only to the extent such 
                        compliance exceeds the minimum level required 
                        under such systems and levels; and''.

SEC. 620. CONSIDERATION OF ENERGY-EFFICIENCY IMPROVEMENTS IN 
              APPRAISALS.

    (a) Appraisals in Connection With Federally Related Transactions.--
            (1) Requirement.--Section 1110 of the Financial 
        Institutions Reform, Recovery, and Enforcement Act of 1989 (12 
        U.S.C. 3339) is amended--
                    (A) in paragraph (1), by striking ``and'' at the 
                end;
                    (B) by redesignating paragraph (2) as paragraph 
                (3); and
                    (C) by inserting after paragraph (1) the following 
                new paragraph:
            ``(2) that such appraisals be performed in accordance with 
        appraisal standards that require, in determining the value of a 
        property, consideration of any renewable energy sources for, or 
        energy-efficiency or energy-conserving improvements or features 
        of, the property; and''.
            (2) Revision of appraisal standards.--Each Federal 
        financial institutions regulatory agency shall, not later than 
        6 months after the date of the enactment of this Act, revise 
        its standards for the performance of real estate appraisals in 
        connection with federally related transactions under the 
        jurisdiction of the agency to comply with the requirement under 
        the amendments made by paragraph (1) of this subsection.
    (b) Appraiser Certification and Licensing Requirements.--Section 
1116 of the Financial Institutions Reform, Recovery, and Enforcement 
Act of 1989 (12 U.S.C. 3345) is amended--
            (1) in subsection (a), by inserting before the period at 
        the end the following: ``, and meets the requirements 
        established pursuant to subsection (f) for qualifications 
        regarding consideration of any renewable energy sources for, or 
        energy-efficiency or energy-conserving improvements or features 
        of, the property'';
            (2) in subsection (c), by inserting before the period at 
        the end the following: ``, which shall include compliance with 
        the requirements established pursuant to subsection (f) 
        regarding consideration of any renewable energy sources for, or 
        energy-efficiency or energy-conserving improvements or features 
        of, the property'';
            (3) in subsection (e), by striking ``The'' and inserting 
        ``Except as provided in subsection (f), the''; and
            (4) by adding at the end the following new subsection:
    ``(f) Requirements for Appraisers Regarding Energy-Efficiency 
Features.--The Appraisal Subcommittee shall establish requirements for 
State certification of State certified real estate appraisers and for 
State licensing of State licensed appraisers, to ensure that appraisers 
consider and are qualified to consider, in determining the value of a 
property, any renewable energy sources for, or energy-efficiency or 
energy-conserving improvements or features of, the property.''.
    (c) Guidelines for Appraising Photovoltaic Measures and Training of 
Appraisers.--Section 1122 of the Financial Institutions Reform, 
Recovery, and Enforcement Act of 1989 (12 U.S.C. 3351) is amended by 
adding at the end the following new subsection:
    ``(g) Guidelines for Appraising Photovoltaic Measures and Training 
of Appraisers.--The Appraisal Subcommittee shall, in consultation with 
the Secretary of Housing and Urban Development, the Federal National 
Mortgage Association, and the Federal Home Loan Mortgage Corporation, 
establish specific guidelines for--
            ``(1) appraising off- and on-grid photovoltaic measures for 
        compliance with the appraisal standards prescribed pursuant to 
        section 1110(2);
            ``(2) requirements under section 1116(f) for certification 
        of State certified real estate appraisers and for State 
        licensing of State licensed appraisers, to ensure that 
        appraisers consider, and are qualified to consider, such 
        photovoltaic measures in determining the value of a property; 
        and
            ``(3) training of appraisers to meet the requirements 
        established pursuant to paragraph (2) of this subsection.''.

SEC. 621. ASSISTANCE FOR HOUSING ASSISTANCE COUNCIL.

    The Secretary shall require the Housing Assistance Council--
            (1) to encourage each organization that receives assistance 
        from the Council with any amounts made available from the 
        Secretary to provide that any structures and buildings 
        developed or assisted under projects, programs, and activities 
        funded with such amounts complies with the enhanced energy 
        efficiency requirements under section 604(a) of this title; and
            (2) to establish incentives to encourage each such 
        organization to provide that any such structures and buildings 
        comply with the energy efficiency and conservation standards, 
        and the green building standards, under section 604(b) of this 
        title.

SEC. 622. RURAL HOUSING AND ECONOMIC DEVELOPMENT ASSISTANCE.

    The Secretary shall--
            (1) encourage each tribe, agency, organization, 
        corporation, and other entity that receives any assistance from 
        the Office of Rural Housing and Economic Development of the 
        Department of Housing and Urban Development to provide that any 
        structures and buildings developed or assisted under activities 
        funded with such amounts complies with the energy efficiency 
        requirements under section 604(a) of this title; and
            (2) establish incentives to encourage each such tribe, 
        agency, organization, corporation, and other entity to provide 
        that any such structures and buildings comply with the enhanced 
        energy efficiency and conservation standards, and the green 
        building standards, under section 604(b) of this title.

SEC. 623. LOANS TO STATES AND INDIAN TRIBES TO CARRY OUT RENEWABLE 
              ENERGY SOURCES ACTIVITIES.

    (a) Establishment of Fund.--There is established in the Treasury of 
the United States a fund, to be known as the ``Alternative Energy 
Sources State Loan Fund''.
    (b) Expenditures.--
            (1) In general.--Subject to paragraph (2), on request by 
        the Secretary, the Secretary of the Treasury shall transfer 
        from the Fund to the Secretary such amounts as the Secretary 
        determines are necessary to provide loans under subsection 
        (c)(1).
            (2) Administrative expenses.--Of the amounts in the Fund, 
        not more than 5 percent shall be available for each fiscal year 
        to pay the administrative expenses of the Department of Housing 
        and Urban Development to carry out this section.
    (c) Loans to States and Indian Tribes.--
            (1) In general.--The Secretary shall use amounts in the 
        Fund to provide loans to States and Indian tribes to provide 
        incentives to owners of single-family and multifamily housing, 
        commercial properties, and public buildings to provide--
                    (A) renewable energy sources for such structures, 
                such as wind, wave, solar, biomass, or geothermal 
                energy sources, including incentives to companies and 
                business to change their source of energy to such 
                renewable energy sources and for changing the sources 
                of energy for public buildings to such renewable energy 
                sources;
                    (B) energy efficiency and energy conserving 
                improvements and features for such structures; or
                    (C) infrastructure related to the delivery of 
                electricity and hot water for structures lacking such 
                amenities.
            (2) Eligibility.--To be eligible to receive a loan under 
        this subsection, a State or Indian tribe, directly or through 
        an appropriate State or tribal agency, shall submit to the 
        Secretary an application at such time, in such manner, and 
        containing such information as the Secretary may require.
            (3) Criteria for approval.--The Secretary may approve an 
        application of a State or Indian tribe under paragraph (2) only 
        if the Secretary determines that the State or tribe will use 
        the funds from the loan under this subsection to carry out a 
        program to provide incentives described in paragraph (1) that--
                    (A) requires that any such renewable energy 
                sources, and energy efficiency and energy conserving 
                improvements and features, developed pursuant to 
                assistance under the program result in compliance of 
                the structure so improved with the energy efficiency 
                requirements under section 604(a) of this title; and
                    (B) includes such compliance and audit requirements 
                as the Secretary determines are necessary to ensure 
                that the program is operated in a sound and effective 
                manner.
            (4) Preference.--In making loans during each fiscal year, 
        the Secretary shall give preference to States and Indian tribes 
        that have not previously received a loan under this subsection.
            (5) Maximum amount.--The aggregate outstanding principal 
        amount from loans under this subsection to any single State or 
        Indian tribe may not exceed $500,000,000.
            (6) Loan terms.--Each loan under this subsection shall have 
        a term to maturity of not more than 10 years and shall bear 
        interest at annual rate, determined by the Secretary, that 
        shall not exceed interest rate charged by the Federal Reserve 
        Bank of New York to commercial banks and other depository 
        institutions for very short-term loans under the primary credit 
        program, as most recently published in the Federal Reserve 
        Statistical Release on selected interest rates (daily or 
        weekly), and commonly referred to as the H.15 release, 
        preceding the date of a determination for purposes of applying 
        this paragraph.
            (7) Loan repayment.--The Secretary shall require full 
        repayment of each loan made under this section.
    (d) Investment of Amounts.--
            (1) In general.--The Secretary of the Treasury shall invest 
        such amounts in the Fund that are not, in the judgment of the 
        Secretary of the Treasury, required to meet needs for current 
        withdrawals.
            (2) Obligations of united states.--Investments may be made 
        only in interest-bearing obligations of the United States.
    (e) Reports.--
            (1) Reports to secretary.--For each year during the term of 
        a loan made under subsection (c), the State or Indian tribe 
        that received the loan shall submit to the Secretary a report 
        describing the State or tribal alternative energy sources 
        program for which the loan was made and the activities 
        conducted under the program using the loan funds during that 
        year.
            (2) Report to congress.--Not later than September 30 of 
        each year that loans made under subsection (c) are outstanding, 
        the Secretary shall submit a report to the Congress describing 
        the total amount of such loans provided under subsection (c) to 
        each eligible State and Indian tribe during the fiscal year 
        ending on such date, and an evaluation on effectiveness of the 
        Fund.
    (f) Authorization of Appropriations.--There is authorized to be 
appropriated to the Fund $5,000,000,000.
    (g) Definitions.--For purposes of this section, the following 
definitions shall apply:
            (1) Indian tribe.--The term ``Indian tribe'' has the 
        meaning given such term in section 4 of the Native American 
        Housing Assistance and Self-Determination Act of 1996 (25 
        U.S.C. 4103).
            (2) State.--The term ``State'' means each of the several 
        States, the Commonwealth of Puerto Rico, the District of 
        Columbia, the Commonwealth of the Northern Mariana Islands, 
        Guam, the Virgin Islands, American Samoa, the Trust Territories 
        of the Pacific, or any other possession of the United States.

SEC. 624. GREEN BANKING CENTERS.

    (a) Insured Depository Institutions.--Section 8 of the Federal 
Deposit Insurance Act (12 U.S.C. 1818) is amended by adding at the end 
the following new subsection:
    ``(x) `Green Banking' Centers.--
            ``(1) In general.--The Federal banking agencies shall 
        prescribe guidelines encouraging the establishment and 
        maintenance of `green banking' centers by insured depository 
        institutions to provide any consumer who seeks information on 
        obtaining a mortgage, home improvement loan, or home equity 
        loan with additional information on--
                    ``(A) obtaining an home energy rating or audit for 
                the residence for which such mortgage or loan is 
                sought;
                    ``(B) obtaining financing for cost-effective 
                energy-saving improvements to such property; and
                    ``(C) obtaining beneficial terms for any mortgage 
                or loan, or qualifying for a larger mortgage or loan, 
                secured by a residence which meets or will meet energy-
                efficiency standards.
            ``(2) Information and referrals.--The information made 
        available to consumers under paragraph (1) may include--
                    ``(A) information on obtaining a home energy rating 
                and contact information on qualified energy raters in 
                the area of the residence;
                    ``(B) information on the secondary market 
                guidelines that permit lenders to provide more 
                favorable terms by allowing lenders to increase the 
                ratio on debt-to-income requirements or to use the 
                projected utility savings as a compensating factor;
                    ``(C) information including eligibility information 
                about, and contact information for, any conservation or 
                renewable energy programs, grants, or loans offered by 
                the Secretary of Housing and Urban Development, 
                including the Energy Efficient Mortgage Program;
                    ``(D) information including eligibility information 
                about, and contact information for, any conservation or 
                renewable energy programs, grants, or loans offered for 
                qualified military personal, reservists, and veterans 
                by the Secretary of Veterans Affairs;
                    ``(E) information about, and contact information 
                for, the Office of Efficiency and Renewable Energy at 
                the Department of Energy, including the weatherization 
                assistance program;
                    ``(F) information about, and contact information 
                for, the Energy Star Program of the Environmental 
                Protection Agency;
                    ``(G) information from, and contact information 
                for, the Federal Citizen Information Center of the 
                General Services Administration on energy efficient 
                mortgages and loans, home energy rating systems, and 
                the availability of energy efficient mortgage 
                information from a variety of Federal agencies; and
                    ``(H) such other information as the agencies or the 
                insured depository institution may determine to be 
                appropriate or useful.''.
    (b) Insured Credit Unions.--Section 206 of the Federal Credit Union 
Act (12 U.S.C. 1786) is amended by adding at the end the following new 
subsection:
    ``(x) `Green Banking' Centers.--
            ``(1) In general.--The Board shall prescribe guidelines 
        encouraging the establishment and maintenance of `green 
        banking' centers by insured credit unions to provide any member 
        who seeks information on obtaining a mortgage, home improvement 
        loan, or home equity loan with additional information on--
                    ``(A) obtaining an home energy rating or audit for 
                the residence for which such mortgage or loan is 
                sought;
                    ``(B) obtaining financing for cost-effective 
                energy-saving improvements to such property; and
                    ``(C) obtaining beneficial terms for any mortgage 
                or loan, or qualifying for a larger mortgage or loan, 
                secured by a residence which meets or will meet energy-
                efficiency standards.
            ``(2) Information and referrals.--The information made 
        available to members under paragraph (1) may include--
                    ``(A) information on obtaining a home energy rating 
                and contact information on qualified energy raters in 
                the area of the residence;
                    ``(B) information on the secondary market 
                guidelines that permit lenders to provide more 
                favorable terms by allowing lenders to increase the 
                ratio on debt-to-income requirements or to use the 
                projected utility savings as a compensating factor;
                    ``(C) information including eligibility information 
                about, and contact information for, any conservation or 
                renewable energy programs, grants, or loans offered by 
                the Secretary of Housing and Urban Development, 
                including the Energy Efficient Mortgage Program;
                    ``(D) information including eligibility information 
                about, and contact information for, any conservation or 
                renewable energy programs, grants, or loans offered for 
                qualified military personal, reservists, and veterans 
                by the Secretary of Veterans Affairs;
                    ``(E) information about, and contact information 
                for, the Office of Efficiency and Renewable Energy at 
                the Department of Energy, including the weatherization 
                assistance program;
                    ``(F) information from, and contact information 
                for, the Federal Citizen Information Center of the 
                General Services Administration on energy efficient 
                mortgages and loans, home energy rating systems, and 
                the availability of energy efficient mortgage 
                information from a variety of Federal agencies; and
                    ``(G) such other information as the Board or the 
                insured credit union may determine to be appropriate or 
                useful.''.

SEC. 625. PUBLIC HOUSING ENERGY COST REPORT.

    (a) Collection of Information by HUD.--The Secretary of Housing and 
Urban Development shall obtain from each public housing agency, by such 
time as may be necessary to comply with the reporting requirement under 
subsection (b), information regarding the energy costs for public 
housing administered or operated by the agency. For each public housing 
agency, such information shall include the monthly energy costs 
associated with each separate building and development of the agency, 
for the most recently completed 12-month period for which such 
information is available, and such other information as the Secretary 
determines is appropriate in determining which public housing buildings 
and developments are most in need of repairs and improvements to reduce 
energy needs and costs and become more energy efficient.
    (b) Report.--Not later than the expiration of the 12-month period 
beginning on the date of the enactment of this Act, the Secretary of 
Housing and Urban Development shall submit a report to the Congress 
setting forth the information collected pursuant to subsection (a).

                  TITLE VII--MISCELLANEOUS PROVISIONS

SEC. 701. ALTERNATIVE FUEL PUMPS.

    (a) Requirement.--Not later than January 1, 2018, each retail 
automotive fueling station owned by a major integrated oil company 
shall have at least 1 alternative fuel pump (and necessary 
infrastructure and storage facilities) available to dispense for 
automotive purposes a fuel referred to in subparagraph (A), (B), (C), 
or (D) of subsection (c)(2) .
    (b) Penalty.--A major integrated oil company that has failed to 
comply with subsection (a) as of January 1 of any calendar year 
beginning with 2018 shall be liable for a civil penalty in the amount 
of $100,000 for each automotive fueling station owned by such company 
that is not in compliance. Any such penalty may be assessed and 
collected by the Secretary of Energy by order. The Secretary may bring 
an action in the appropriate United States District court to require 
the payment of civil penalties imposed under this subsection, and such 
court shall have jurisdiction to enforce any order of the Secretary 
under this subsection.
    (c) Definitions.--For purposes of this section:
            (1) The term ``major integrated oil company'' has the 
        meaning given that term in section 167(h)(5)(B) of the Internal 
        Revenue Code of 1986.
            (2) The term ``alternative fuel pump'' means a fuel pump 
        that dispenses as a fuel for automotive purposes--
                    (A) natural gas;
                    (B) any fuel at least 85 percent of the volume of 
                which consists of ethanol;
                    (C) any mixture of biodiesel and diesel or 
                renewable diesel (as defined in regulations under 
                section 211(o) of the Clean Air Act), determined 
                without regard to any use of kerosene and containing at 
                least 20 percent biodiesel or renewable diesel; or
                    (D) hydrogen.
    (d) Regulations.--The Secretary of Energy shall promulgate such 
regulations as may be necessary to carry out this section.

SEC. 702. NATIONAL ENERGY CENTER OF EXCELLENCE.

    (a) Establishment.--The Secretary of Energy shall award a grant on 
a competitive basis to one consortium of institutions of higher 
education (as such term is defined in section 102 of the Higher 
Education Act of 1965) for the establishment of a National Energy 
Center of Excellence to conduct research and education activities in 
geological and geothermal sciences, renewable energy and energy 
efficiency (including energy technology using clean coal, solar, wind, 
oil, natural gas, hydroelectric, biofuels, ethanol, and other energy 
alternatives), and energy conservation, including a special emphasis on 
environmentally safe energy.
    (b) Consortium.--The consortium shall include at least two 
institutions of higher education, one of which must be eligible to 
receive assistance under part A or B of title III or title V of the 
Higher Education Act of 1965.
    (c) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $25,000,000 for each of the 
fiscal years 2009 through 2013.

SEC. 703. SENSE OF CONGRESS REGARDING RENEWABLE BIOMASS.

    It is the sense of Congress that--
            (1) in order to fulfill the commitment of the United States 
        to energy security and independence, the current definition of 
        renewable biomass in the Renewable Fuel Standard (RFS) could be 
        improved;
            (2) in order to meet the United States' energy challenges 
        in an environmentally responsible way, the RFS should be as 
        inclusive as possible to better reflect the realities of our 
        Nation's resources, to encourage investment, and to help us 
        meet the congressional mandate for advanced biofuels;
            (3) Congress recognizes that renewable fuels are important 
        to our climate and energy security strategy, as well as the 
        rural communities they support; and
            (4) cellulosic biofuels can and should be produced from a 
        highly diverse array of feedstocks, allowing every region of 
        the country to be a potential producer of this fuel.

                   TITLE VIII--ENERGY TAX INCENTIVES

SEC. 800. SHORT TITLE, ETC.

    (a) Short Title.--This title may be cited as the ``Energy Tax 
Incentives Act of 2008''.
    (b) Reference.--Except as otherwise expressly provided, whenever in 
this title an amendment or repeal is expressed in terms of an amendment 
to, or repeal of, a section or other provision, the reference shall be 
considered to be made to a section or other provision of the Internal 
Revenue Code of 1986.

                Subtitle A--Energy Production Incentives

                  PART 1--RENEWABLE ENERGY INCENTIVES

SEC. 801. RENEWABLE ENERGY CREDIT.

    (a) Extension of Credit.--
            (1) 1-year extension for wind facilities.--Paragraph (1) of 
        section 45(d) is amended by striking ``January 1, 2009'' and 
        inserting ``January 1, 2010''.
            (2) 3-year extension for certain other facilities.--Each of 
        the following provisions of section 45(d) is amended by 
        striking ``January 1, 2009'' and inserting ``January 1, 2012'':
                    (A) Clauses (i) and (ii) of paragraph (2)(A).
                    (B) Clauses (i)(I) and (ii) of paragraph (3)(A).
                    (C) Paragraph (4).
                    (D) Paragraph (5).
                    (E) Paragraph (6).
                    (F) Paragraph (7).
                    (G) Subparagraphs (A) and (B) of paragraph (9).
    (b) Modification of Credit Phaseout.--
            (1) Repeal of phaseout.--Subsection (b) of section 45 is 
        amended--
                    (A) by striking paragraph (1), and
                    (B) by striking ``the 8 cent amount in paragraph 
                (1),'' in paragraph (2) thereof.
            (2) Limitation based on investment in facility.--Subsection 
        (b) of section 45 is amended by inserting before paragraph (2) 
        the following new paragraph:
            ``(1) Limitation based on investment in facility.--
                    ``(A) In general.--In the case of any qualified 
                facility originally placed in service after December 
                31, 2009, the amount of the credit determined under 
                subsection (a) for any taxable year with respect to 
                electricity produced at such facility shall not exceed 
                the product of--
                            ``(i) the applicable percentage with 
                        respect to such facility, multiplied by
                            ``(ii) the eligible basis of such facility.
                    ``(B) Carryforward of unused limitation and excess 
                credit.--
                            ``(i) Unused limitation.--If the limitation 
                        imposed under subparagraph (A) with respect to 
                        any facility for any taxable year exceeds the 
                        prelimitation credit for such facility for such 
                        taxable year, the limitation imposed under 
                        subparagraph (A) with respect to such facility 
                        for the succeeding taxable year shall be 
                        increased by the amount of such excess.
                            ``(ii) Excess credit.--If the prelimitation 
                        credit with respect to any facility for any 
                        taxable year exceeds the limitation imposed 
                        under subparagraph (A) with respect to such 
                        facility for such taxable year, the credit 
                        determined under subsection (a) with respect to 
                        such facility for the succeeding taxable year 
                        (determined before the application of 
                        subparagraph (A) for such succeeding taxable 
                        year) shall be increased by the amount of such 
                        excess. With respect to any facility, no amount 
                        may be carried forward under this clause to any 
                        taxable year beginning after the 10-year period 
                        described in subsection (a)(2)(A)(ii) with 
                        respect to such facility.
                            ``(iii) Prelimitation credit.--The term 
                        `prelimitation credit' with respect to any 
                        facility for a taxable year means the credit 
                        determined under subsection (a) with respect to 
                        such facility for such taxable year, determined 
                        without regard to subparagraph (A) and after 
                        taking into account any increase for such 
                        taxable year under clause (ii).
                    ``(C) Applicable percentage.--For purposes of this 
                paragraph--
                            ``(i) In general.--The term `applicable 
                        percentage' means, with respect to any 
                        facility, the appropriate percentage prescribed 
                        by the Secretary for the month in which such 
                        facility is originally placed in service.
                            ``(ii) Method of prescribing applicable 
                        percentage.--The applicable percentage 
                        prescribed by the Secretary for any month under 
                        clause (i) shall be the percentage which yields 
                        over a 10-year period amounts of limitation 
                        under subparagraph (A) which have a present 
                        value equal to 35 percent of the eligible basis 
                        of the facility.
                            ``(iii) Method of discounting.--The present 
                        value under clause (ii) shall be determined--
                                    ``(I) as of the last day of the 1st 
                                year of the 10-year period referred to 
                                in clause (ii),
                                    ``(II) by using a discount rate 
                                equal to the greater of 110 percent of 
                                the Federal long-term rate as in effect 
                                under section 1274(d) for the month 
                                preceding the month for which the 
                                applicable percentage is being 
                                prescribed, or 4.5 percent, and
                                    ``(III) by taking into account the 
                                limitation under subparagraph (A) for 
                                any year on the last day of such year.
                    ``(D) Eligible basis.--For purposes of this 
                paragraph--
                            ``(i) In general.--The term `eligible 
                        basis' means, with respect to any facility, the 
                        sum of--
                                    ``(I) the basis of such facility 
                                determined as of the time that such 
                                facility is originally placed in 
                                service, and
                                    ``(II) the portion of the basis of 
                                any shared qualified property which is 
                                properly allocable to such facility 
                                under clause (ii).
                            ``(ii) Rules for allocation.--For purposes 
                        of subclause (II) of clause (i), the basis of 
                        shared qualified property shall be allocated 
                        among all qualified facilities which are 
                        projected to be placed in service and which 
                        require utilization of such property in 
                        proportion to projected generation from such 
                        facilities.
                            ``(iii) Shared qualified property.--For 
                        purposes of this paragraph, the term `shared 
                        qualified property' means, with respect to any 
                        facility, any property described in section 
                        168(e)(3)(B)(vi)--
                                    ``(I) which a qualified facility 
                                will require for utilization of such 
                                facility, and
                                    ``(II) which is not a qualified 
                                facility.
                            ``(iv) Special rule relating to geothermal 
                        facilities.--In the case of any qualified 
                        facility using geothermal energy to produce 
                        electricity, the basis of such facility for 
                        purposes of this paragraph shall be determined 
                        as though intangible drilling and development 
                        costs described in section 263(c) were 
                        capitalized rather than expensed.
                    ``(E) Special rule for first and last year of 
                credit period.--In the case of any taxable year any 
                portion of which is not within the 10-year period 
                described in subsection (a)(2)(A)(ii) with respect to 
                any facility, the amount of the limitation under 
                subparagraph (A) with respect to such facility shall be 
                reduced by an amount which bears the same ratio to the 
                amount of such limitation (determined without regard to 
                this subparagraph) as such portion of the taxable year 
                which is not within such period bears to the entire 
                taxable year.
                    ``(F) Election to treat all facilities placed in 
                service in a year as 1 facility.--At the election of 
                the taxpayer, all qualified facilities which are part 
                of the same project and which are originally placed in 
                service during the same calendar year shall be treated 
                for purposes of this section as 1 facility which is 
                originally placed in service at the mid-point of such 
                year or the first day of the following calendar 
                year.''.
    (c) Trash Facility Clarification.--Paragraph (7) of section 45(d) 
is amended--
            (1) by striking ``facility which burns'' and inserting 
        ``facility (other than a facility described in paragraph (6)) 
        which uses'', and
            (2) by striking ``combustion''.
    (d) Expansion of Biomass Facilities.--
            (1) Open-loop biomass facilities.--Paragraph (3) of section 
        45(d) is amended by redesignating subparagraph (B) as 
        subparagraph (C) and by inserting after subparagraph (A) the 
        following new subparagraph:
                    ``(B) Expansion of facility.--Such term shall 
                include a new unit placed in service after the date of 
                the enactment of this subparagraph in connection with a 
                facility described in subparagraph (A), but only to the 
                extent of the increased amount of electricity produced 
                at the facility by reason of such new unit.''.
            (2) Closed-loop biomass facilities.--Paragraph (2) of 
        section 45(d) is amended by redesignating subparagraph (B) as 
        subparagraph (C) and inserting after subparagraph (A) the 
        following new subparagraph:
                    ``(B) Expansion of facility.--Such term shall 
                include a new unit placed in service after the date of 
                the enactment of this subparagraph in connection with a 
                facility described in subparagraph (A)(i), but only to 
                the extent of the increased amount of electricity 
                produced at the facility by reason of such new unit.''.
    (e) Modification of Rules for Hydropower Production.--Subparagraph 
(C) of section 45(c)(8) is amended to read as follows:
                    ``(C) Nonhydroelectric dam.--For purposes of 
                subparagraph (A), a facility is described in this 
                subparagraph if--
                            ``(i) the hydroelectric project installed 
                        on the nonhydroelectric dam is licensed by the 
                        Federal Energy Regulatory Commission and meets 
                        all other applicable environmental, licensing, 
                        and regulatory requirements,
                            ``(ii) the nonhydroelectric dam was placed 
                        in service before the date of the enactment of 
                        this paragraph and operated for flood control, 
                        navigation, or water supply purposes and did 
                        not produce hydroelectric power on the date of 
                        the enactment of this paragraph, and
                            ``(iii) the hydroelectric project is 
                        operated so that the water surface elevation at 
                        any given location and time that would have 
                        occurred in the absence of the hydroelectric 
                        project is maintained, subject to any license 
                        requirements imposed under applicable law that 
                        change the water surface elevation for the 
                        purpose of improving environmental quality of 
                        the affected waterway.
                The Secretary, in consultation with the Federal Energy 
                Regulatory Commission, shall certify if a hydroelectric 
                project licensed at a nonhydroelectric dam meets the 
                criteria in clause (iii). Nothing in this section shall 
                affect the standards under which the Federal Energy 
                Regulatory Commission issues licenses for and regulates 
                hydropower projects under part I of the Federal Power 
                Act.''.
    (f) Effective Date.--
            (1) In general.--Except as otherwise provided in this 
        subsection, the amendments made by this section shall apply to 
        property originally placed in service after December 31, 2008.
            (2) Repeal of credit phaseout.--The amendments made by 
        subsection (b)(1) shall apply to taxable years ending after 
        December 31, 2008.
            (3) Limitation based on investment in facility.--The 
        amendment made by subsection (b)(2) shall apply to property 
        originally placed in service after December 31, 2009.
            (4) Trash facility clarification.--The amendments made by 
        subsection (c) shall apply to electricity produced and sold 
        after the date of the enactment of this Act.
            (5) Expansion of biomass facilities.--The amendments made 
        by subsection (d) shall apply to property placed in service 
        after the date of the enactment of this Act.

SEC. 802. PRODUCTION CREDIT FOR ELECTRICITY PRODUCED FROM MARINE 
              RENEWABLES.

    (a) In General.--Paragraph (1) of section 45(c) is amended by 
striking ``and'' at the end of subparagraph (G), by striking the period 
at the end of subparagraph (H) and inserting ``, and'', and by adding 
at the end the following new subparagraph:
                    ``(I) marine and hydrokinetic renewable energy.''.
    (b) Marine Renewables.--Subsection (c) of section 45 is amended by 
adding at the end the following new paragraph:
            ``(10) Marine and hydrokinetic renewable energy.--
                    ``(A) In general.--The term `marine and 
                hydrokinetic renewable energy' means energy derived 
                from--
                            ``(i) waves, tides, and currents in oceans, 
                        estuaries, and tidal areas,
                            ``(ii) free flowing water in rivers, lakes, 
                        and streams,
                            ``(iii) free flowing water in an irrigation 
                        system, canal, or other man-made channel, 
                        including projects that utilize nonmechanical 
                        structures to accelerate the flow of water for 
                        electric power production purposes, or
                            ``(iv) differentials in ocean temperature 
                        (ocean thermal energy conversion).
                    ``(B) Exceptions.--Such term shall not include any 
                energy which is derived from any source which utilizes 
                a dam, diversionary structure (except as provided in 
                subparagraph (A)(iii)), or impoundment for electric 
                power production purposes.''.
    (c) Definition of Facility.--Subsection (d) of section 45 is 
amended by adding at the end the following new paragraph:
            ``(11) Marine and hydrokinetic renewable energy 
        facilities.--In the case of a facility producing electricity 
        from marine and hydrokinetic renewable energy, the term 
        `qualified facility' means any facility owned by the taxpayer--
                    ``(A) which has a nameplate capacity rating of at 
                least 150 kilowatts, and
                    ``(B) which is originally placed in service on or 
                after the date of the enactment of this paragraph and 
                before January 1, 2012.''.
    (d) Credit Rate.--Subparagraph (A) of section 45(b)(4) is amended 
by striking ``or (9)'' and inserting ``(9), or (11)''.
    (e) Coordination With Small Irrigation Power.--Paragraph (5) of 
section 45(d), as amended by section 801, is amended by striking 
``January 1, 2012'' and inserting ``the date of the enactment of 
paragraph (11)''.
    (f) Effective Date.--The amendments made by this section shall 
apply to electricity produced and sold after the date of the enactment 
of this Act, in taxable years ending after such date.

SEC. 803. ENERGY CREDIT.

    (a) Extension of Credit.--
            (1) Solar energy property.--Paragraphs (2)(A)(i)(II) and 
        (3)(A)(ii) of section 48(a) are each amended by striking 
        ``January 1, 2009'' and inserting ``January 1, 2017''.
            (2) Fuel cell property.--Subparagraph (E) of section 
        48(c)(1) is amended by striking ``December 31, 2008'' and 
        inserting ``December 31, 2016''.
            (3) Microturbine property.--Subparagraph (E) of section 
        48(c)(2) is amended by striking ``December 31, 2008'' and 
        inserting ``December 31, 2016''.
    (b) Allowance of Energy Credit Against Alternative Minimum Tax.--
Subparagraph (B) of section 38(c)(4) is amended by striking ``and'' at 
the end of clause (iii), by redesignating clauses (v) and (vi) as 
clauses (vi) and (vii), respectively, and by inserting after clause 
(iv) the following new clause:
                            ``(v) the credit determined under section 
                        46 to the extent that such credit is 
                        attributable to the energy credit determined 
                        under section 48, and''.
    (c) Energy Credit for Combined Heat and Power System Property.--
            (1) In general.--Section 48(a)(3)(A) (defining energy 
        property) is amended by striking ``or'' at the end of clause 
        (iii), by inserting ``or'' at the end of clause (iv), and by 
        adding at the end the following new clause:
                            ``(v) combined heat and power system 
                        property,''.
            (2) Combined heat and power system property.--Section 48 is 
        amended by adding at the end the following new subsection:
    ``(d) Combined Heat and Power System Property.--For purposes of 
subsection (a)(3)(A)(v)--
            ``(1) Combined heat and power system property.--The term 
        `combined heat and power system property' means property 
        comprising a system--
                    ``(A) which uses the same energy source for the 
                simultaneous or sequential generation of electrical 
                power, mechanical shaft power, or both, in combination 
                with the generation of steam or other forms of useful 
                thermal energy (including heating and cooling 
                applications),
                    ``(B) which produces--
                            ``(i) at least 20 percent of its total 
                        useful energy in the form of thermal energy 
                        which is not used to produce electrical or 
                        mechanical power (or combination thereof), and
                            ``(ii) at least 20 percent of its total 
                        useful energy in the form of electrical or 
                        mechanical power (or combination thereof),
                    ``(C) the energy efficiency percentage of which 
                exceeds 60 percent, and
                    ``(D) which is placed in service before January 1, 
                2017.
            ``(2) Limitation.--
                    ``(A) In general.--In the case of combined heat and 
                power system property with an electrical capacity in 
                excess of the applicable capacity placed in service 
                during the taxable year, the credit under subsection 
                (a)(1) (determined without regard to this paragraph) 
                for such year shall be equal to the amount which bears 
                the same ratio to such credit as the applicable 
                capacity bears to the capacity of such property.
                    ``(B) Applicable capacity.--For purposes of 
                subparagraph (A), the term `applicable capacity' means 
                15 megawatts or a mechanical energy capacity of more 
                than 20,000 horsepower or an equivalent combination of 
                electrical and mechanical energy capacities.
                    ``(C) Maximum capacity.--The term `combined heat 
                and power system property' shall not include any 
                property comprising a system if such system has a 
                capacity in excess of 50 megawatts or a mechanical 
                energy capacity in excess of 67,000 horsepower or an 
                equivalent combination of electrical and mechanical 
                energy capacities.
            ``(3) Special rules.--
                    ``(A) Energy efficiency percentage.--For purposes 
                of this subsection, the energy efficiency percentage of 
                a system is the fraction--
                            ``(i) the numerator of which is the total 
                        useful electrical, thermal, and mechanical 
                        power produced by the system at normal 
                        operating rates, and expected to be consumed in 
                        its normal application, and
                            ``(ii) the denominator of which is the 
                        lower heating value of the fuel sources for the 
                        system.
                    ``(B) Determinations made on btu basis.--The energy 
                efficiency percentage and the percentages under 
                paragraph (1)(B) shall be determined on a Btu basis.
                    ``(C) Input and output property not included.--The 
                term `combined heat and power system property' does not 
                include property used to transport the energy source to 
                the facility or to distribute energy produced by the 
                facility.
            ``(4) Systems using biomass.--If a system is designed to 
        use biomass (within the meaning of paragraphs (2) and (3) of 
        section 45(c) without regard to the last sentence of paragraph 
        (3)(A)) for at least 90 percent of the energy source--
                    ``(A) paragraph (1)(C) shall not apply, but
                    ``(B) the amount of credit determined under 
                subsection (a) with respect to such system shall not 
                exceed the amount which bears the same ratio to such 
                amount of credit (determined without regard to this 
                paragraph) as the energy efficiency percentage of such 
                system bears to 60 percent.''.
    (d) Increase of Credit Limitation for Fuel Cell Property.--
Subparagraph (B) of section 48(c)(1) is amended by striking ``$500'' 
and inserting ``$1,500''.
    (e) Public Utility Property Taken Into Account.--
            (1) In general.--Paragraph (3) of section 48(a) is amended 
        by striking the second sentence thereof.
            (2) Conforming amendments.--
                    (A) Paragraph (1) of section 48(c) is amended by 
                striking subparagraph (D) and redesignating 
                subparagraph (E) as subparagraph (D).
                    (B) Paragraph (2) of section 48(c) is amended by 
                striking subparagraph (D) and redesignating 
                subparagraph (E) as subparagraph (D).
    (f) Effective Date.--
            (1) In general.--Except as otherwise provided in this 
        subsection, the amendments made by this section shall take 
        effect on the date of the enactment of this Act.
            (2) Allowance against alternative minimum tax.--The 
        amendments made by subsection (b) shall apply to credits 
        determined under section 46 of the Internal Revenue Code of 
        1986 in taxable years beginning after the date of the enactment 
        of this Act and to carrybacks of such credits.
            (3) Combined heat and power and fuel cell property.--The 
        amendments made by subsections (c) and (d) shall apply to 
        periods after the date of the enactment of this Act, in taxable 
        years ending after such date, under rules similar to the rules 
        of section 48(m) of the Internal Revenue Code of 1986 (as in 
        effect on the day before the date of the enactment of the 
        Revenue Reconciliation Act of 1990).
            (4)  Public utility property.--The amendments made by 
        subsection (e) shall apply to periods after February 13, 2008, 
        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. 804. CREDIT FOR RESIDENTIAL ENERGY EFFICIENT PROPERTY.

    (a) Extension.--Section 25D(g) is amended by striking ``December 
31, 2008'' and inserting ``December 31, 2016''.
    (b) Maximum Credit for Solar Electric Property.--
            (1) In general.--Section 25D(b)(1)(A) is amended by 
        striking ``$2,000'' and inserting ``$4,000''.
            (2) Conforming amendment.--Section 25D(e)(4)(A)(i) is 
        amended by striking ``$6,667'' and inserting ``$13,333''.
    (c) Credit for Residential Wind Property.--
            (1) In general.--Section 25D(a) is amended by striking 
        ``and'' at the end of paragraph (2), by striking the period at 
        the end of paragraph (3) and inserting ``, and'', and by adding 
        at the end the following new paragraph:
            ``(4) 30 percent of the qualified small wind energy 
        property expenditures made by the taxpayer during such year.''.
            (2) Limitation.--Section 25D(b)(1) is amended by striking 
        ``and'' at the end of subparagraph (B), by striking the period 
        at the end of subparagraph (C) and inserting ``, and'', and by 
        adding at the end the following new subparagraph:
                    ``(D) $500 with respect to each half kilowatt of 
                capacity (not to exceed $4,000) of wind turbines for 
                which qualified small wind energy property expenditures 
                are made.''.
            (3) Qualified small wind energy property expenditures.--
                    (A) In general.--Section 25D(d) is amended by 
                adding at the end the following new paragraph:
            ``(4) Qualified small wind energy property expenditure.--
        The term `qualified small wind energy property expenditure' 
        means an expenditure for property which uses a wind turbine to 
        generate electricity for use in connection with a dwelling unit 
        located in the United States and used as a residence by the 
        taxpayer.''.
                    (B) No double benefit.--Section 45(d)(1) is amended 
                by adding at the end the following new sentence: ``Such 
                term shall not include any facility with respect to 
                which any qualified small wind energy property 
                expenditure (as defined in subsection (d)(4) of section 
                25D) is taken into account in determining the credit 
                under such section.''.
            (4) Maximum expenditures in case of joint occupancy.--
        Section 25D(e)(4)(A) is amended by striking ``and'' at the end 
        of clause (ii), by striking the period at the end of clause 
        (iii) and inserting ``, and'', and by adding at the end the 
        following new clause:
                            ``(iv) $1,667 in the case of each half 
                        kilowatt of capacity (not to exceed $13,333) of 
                        wind turbines for which qualified small wind 
                        energy property expenditures are made.''.
    (d) Credit for Geothermal Heat pump Systems.--
            (1) In general.--Section 25D(a), as amended by subsection 
        (c), 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) 30 percent of the qualified geothermal heat pump 
        property expenditures made by the taxpayer during such year.''.
            (2) Limitation.--Section 25D(b)(1), as amended by 
        subsection (c), is amended by striking ``and'' at the end of 
        subparagraph (C), by striking the period at the end of 
        subparagraph (D) and inserting ``, and'', and by adding at the 
        end the following new subparagraph:
                    ``(E) $2,000 with respect to any qualified 
                geothermal heat pump property expenditures.''.
            (3) Qualified geothermal heat pump property expenditure.--
        Section 25D(d), as amended by subsection (c), is amended by 
        adding at the end the following new paragraph:
            ``(5) Qualified geothermal heat pump property 
        expenditure.--
                    ``(A) In general.--The term `qualified geothermal 
                heat pump property expenditure' means an expenditure 
                for qualified geothermal heat pump property installed 
                on or in connection with a dwelling unit located in the 
                United States and used as a residence by the taxpayer.
                    ``(B) Qualified geothermal heat pump property.--The 
                term `qualified geothermal heat pump property' means 
                any equipment which--
                            ``(i) uses the ground or ground water as a 
                        thermal energy source to heat the dwelling unit 
                        referred to in subparagraph (A) or as a thermal 
                        energy sink to cool such dwelling unit, and
                            ``(ii) meets the requirements of the Energy 
                        Star program which are in effect at the time 
                        that the expenditure for such equipment is 
                        made.''.
            (4) Maximum expenditures in case of joint occupancy.--
        Section 25D(e)(4)(A), as amended by subsection (c), 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) $6,667 in the case of any qualified 
                        geothermal heat pump property expenditures.''.
    (e) Credit Allowed Against Alternative Minimum Tax.--
            (1) In general.--Subsection (c) of section 25D is amended 
        to read as follows:
    ``(c) Limitation Based on Amount of Tax; Carryforward of Unused 
Credit.--
            ``(1) Limitation based on amount of tax.--In the case of a 
        taxable year to which section 26(a)(2) does not apply, the 
        credit allowed under subsection (a) for the taxable year shall 
        not exceed the excess of--
                    ``(A) the sum of the regular tax liability (as 
                defined in section 26(b)) plus the tax imposed by 
                section 55, over
                    ``(B) the sum of the credits allowable under this 
                subpart (other than this section) and section 27 for 
                the taxable year.
            ``(2) Carryforward of unused credit.--
                    ``(A) Rule for years in which all personal credits 
                allowed against regular and alternative minimum tax.--
                In the case of a taxable year to which section 26(a)(2) 
                applies, if the credit allowable under subsection (a) 
                exceeds the limitation imposed by section 26(a)(2) for 
                such taxable year reduced by the sum of the credits 
                allowable under this subpart (other than this section), 
                such excess shall be carried to the succeeding taxable 
                year and added to the credit allowable under subsection 
                (a) for such succeeding taxable year.
                    ``(B) Rule for other years.--In the case of a 
                taxable year to which section 26(a)(2) does not apply, 
                if the credit allowable under subsection (a) exceeds 
                the limitation imposed by paragraph (1) for such 
                taxable year, such excess shall be carried to the 
                succeeding taxable year and added to the credit 
                allowable under subsection (a) for such succeeding 
                taxable year.''.
            (2) Conforming amendments.--
                    (A) Section 23(b)(4)(B) is amended by inserting 
                ``and section 25D'' after ``this section''.
                    (B) Section 24(b)(3)(B) is amended by striking 
                ``and 25B'' and inserting ``, 25B, and 25D''.
                    (C) Section 25B(g)(2) is amended by striking 
                ``section 23'' and inserting ``sections 23 and 25D''.
                    (D) Section 26(a)(1) is amended by striking ``and 
                25B'' and inserting ``25B, and 25D''.
    (f) Effective Date.--
            (1) In general.--The amendments made by this section shall 
        apply to taxable years beginning after December 31, 2007.
            (2) Application of egtrra sunset.--The amendments made by 
        subparagraphs (A) and (B) of subsection (e)(2) shall be subject 
        to title IX of the Economic Growth and Tax Relief 
        Reconciliation Act of 2001 in the same manner as the provisions 
        of such Act to which such amendments relate.

SEC. 805. SPECIAL RULE TO IMPLEMENT FERC AND STATE ELECTRIC 
              RESTRUCTURING POLICY.

    (a) Extension for Qualified Electric Utilities.--
            (1) In general.--Paragraph (3) of section 451(i) is amended 
        by inserting ``(before January 1, 2010, in the case of a 
        qualified electric utility)'' after ``January 1, 2008''.
            (2) Qualified electric utility.--Subsection (i) of section 
        451 is amended by redesignating paragraphs (6) through (10) as 
        paragraphs (7) through (11), respectively, and by inserting 
        after paragraph (5) the following new paragraph:
            ``(6) Qualified electric utility.--For purposes of this 
        subsection, the term `qualified electric utility' means a 
        person that, as of the date of the qualifying electric 
        transmission transaction, is vertically integrated, in that it 
        is both--
                    ``(A) a transmitting utility (as defined in section 
                3(23) of the Federal Power Act (16 U.S.C. 796(23))) 
                with respect to the transmission facilities to which 
                the election under this subsection applies, and
                    ``(B) an electric utility (as defined in section 
                3(22) of the Federal Power Act (16 U.S.C. 796(22))).''.
    (b) Extension of Period for Transfer of Operational Control 
Authorized by FERC.--Clause (ii) of section 451(i)(4)(B) is amended by 
striking ``December 31, 2007'' and inserting ``the date which is 4 
years after the close of the taxable year in which the transaction 
occurs''.
    (c) Property Located Outside the United States Not Treated as 
Exempt Utility Property.--Paragraph (5) of section 451(i) is amended by 
adding at the end the following new subparagraph:
                    ``(C) Exception for property located outside the 
                united states.--The term `exempt utility property' 
                shall not include any property which is located outside 
                the United States.''.
    (d) Effective Dates.--
            (1) Extension.--The amendments made by subsection (a) shall 
        apply to transactions after December 31, 2007.
            (2) Transfers of operational control.--The amendment made 
        by subsection (b) shall take effect as if included in section 
        909 of the American Jobs Creation Act of 2004.
            (3) Exception for property located outside the united 
        states.--The amendment made by subsection (c) shall apply to 
        transactions after the date of the enactment of this Act.

SEC. 806. NEW CLEAN RENEWABLE ENERGY BONDS.

    (a) In General.--Subpart I of part IV of subchapter A of chapter 1 
is amended by adding at the end the following new section:

``SEC. 54C. NEW CLEAN RENEWABLE ENERGY BONDS.

    ``(a) New Clean Renewable Energy Bond.--For purposes of this 
subpart, the term `new clean renewable energy bond' means any bond 
issued as part of an issue if--
            ``(1) 100 percent of the available project proceeds of such 
        issue are to be used for capital expenditures incurred by 
        public power providers or cooperative electric companies for 
        one or more qualified renewable energy facilities,
            ``(2) the bond is issued by a qualified issuer, and
            ``(3) the issuer designates such bond for purposes of this 
        section.
    ``(b) Reduced Credit Amount.--The annual credit determined under 
section 54A(b) with respect to any new clean renewable energy bond 
shall be 70 percent of the amount so determined without regard to this 
subsection.
    ``(c) Limitation on Amount of Bonds Designated.--
            ``(1) In general.--The maximum aggregate face amount of 
        bonds which may be designated under subsection (a) by any 
        issuer shall not exceed the limitation amount allocated under 
        this subsection to such issuer.
            ``(2) National limitation on amount of bonds designated.--
        There is a national new clean renewable energy bond limitation 
        of $1,750,000,000 which shall be allocated by the Secretary as 
        provided in paragraph (3), except that--
                    ``(A) not more than 33\1/3\ percent thereof may be 
                allocated to qualified projects of public power 
                providers,
                    ``(B) not more than 33\1/3\ percent thereof may be 
                allocated to qualified projects of governmental bodies, 
                and
                    ``(C) not more than 33\1/3\ percent thereof may be 
                allocated to qualified projects of cooperative electric 
                companies.
            ``(3) Method of allocation.--
                    ``(A) Allocation among public power providers.--
                After the Secretary determines the qualified projects 
                of public power providers which are appropriate for 
                receiving an allocation of the national new clean 
                renewable energy bond limitation, the Secretary shall, 
                to the maximum extent practicable, make allocations 
                among such projects in such manner that the amount 
                allocated to each such project bears the same ratio to 
                the cost of such project as the limitation under 
                paragraph (2)(A) bears to the cost of all such 
                projects.
                    ``(B) Allocation among governmental bodies and 
                cooperative electric companies.--The Secretary shall 
                make allocations of the amount of the national new 
                clean renewable energy bond limitation described in 
                paragraphs (2)(B) and (2)(C) among qualified projects 
                of governmental bodies and cooperative electric 
                companies, respectively, in such manner as the 
                Secretary determines appropriate.
    ``(d) Definitions.--For purposes of this section--
            ``(1) Qualified renewable energy facility.--The term 
        `qualified renewable energy facility' means a qualified 
        facility (as determined under section 45(d) without regard to 
        paragraphs (8) and (10) thereof and to any placed in service 
        date) owned by a public power provider, a governmental body, or 
        a cooperative electric company.
            ``(2) Public power provider.--The term `public power 
        provider' means a State utility with a service obligation, as 
        such terms are defined in section 217 of the Federal Power Act 
        (as in effect on the date of the enactment of this paragraph).
            ``(3) Governmental body.--The term `governmental body' 
        means any State or Indian tribal government, or any political 
        subdivision thereof.
            ``(4) Cooperative electric company.--The term `cooperative 
        electric company' means a mutual or cooperative electric 
        company described in section 501(c)(12) or section 
        1381(a)(2)(C).
            ``(5) Clean renewable energy bond lender.--The term `clean 
        renewable energy bond lender' means a lender which is a 
        cooperative which is owned by, or has outstanding loans to, 100 
        or more cooperative electric companies and is in existence on 
        February 1, 2002, and shall include any affiliated entity which 
        is controlled by such lender.
            ``(6) Qualified issuer.--The term `qualified issuer' means 
        a public power provider, a cooperative electric company, a 
        governmental body, a clean renewable energy bond lender, or a 
        not-for-profit electric utility which has received a loan or 
        loan guarantee under the Rural Electrification Act.''.
    (b) Conforming Amendments.--
            (1) Paragraph (1) of section 54A(d) is amended to read as 
        follows:
            ``(1) Qualified tax credit bond.--The term `qualified tax 
        credit bond' means--
                    ``(A) a qualified forestry conservation bond, or
                    ``(B) a new clean renewable energy bond,
        which is part of an issue that meets requirements of paragraphs 
        (2), (3), (4), (5), and (6).''.
            (2) Subparagraph (C) of section 54A(d)(2) is amended to 
        read as follows:
                    ``(C) Qualified purpose.--For purposes of this 
                paragraph, the term `qualified purpose' means--
                            ``(i) in the case of a qualified forestry 
                        conservation bond, a purpose specified in 
                        section 54B(e), and
                            ``(ii) in the case of a new clean renewable 
                        energy bond, a purpose specified in section 
                        54C(a)(1).''.
            (3) The table of sections for subpart I of part IV of 
        subchapter A of chapter 1 is amended by adding at the end the 
        following new item:

``Sec. 54C. New clean renewable energy bonds.''.
    (c) Application of Certain Labor Standards on Projects Financed 
Under Tax Credit Bonds.--Subchapter IV of chapter 31 of title 40, 
United States Code, shall apply to projects financed with the proceeds 
of any tax credit bond (as defined in section 54A of the Internal 
Revenue Code of 1986) other than qualified forestry conservation bonds 
(as defined in section 54B of such Code).
    (d) Effective Date.--The amendments made by this section shall 
apply to obligations issued after the date of the enactment of this 
Act.

                  PART 2--CARBON MITIGATION PROVISIONS

SEC. 811. EXPANSION AND MODIFICATION OF ADVANCED COAL PROJECT 
              INVESTMENT CREDIT.

    (a) Modification of Credit Amount.--Section 48A(a) is amended by 
striking ``and'' at the end of paragraph (1), by striking the period at 
the end of paragraph (2) and inserting ``, and'', and by adding at the 
end the following new paragraph:
            ``(3) 30 percent of the qualified investment for such 
        taxable year in the case of projects described in clause (iii) 
        of subsection (d)(3)(B).''.
    (b) Expansion of Aggregate Credits.--Section 48A(d)(3)(A) is 
amended by striking ``$1,300,000,000'' and inserting 
``$2,250,000,000''.
    (c) Authorization of Additional Projects.--
            (1) In general.--Subparagraph (B) of section 48A(d)(3) is 
        amended to read as follows:
                    ``(B) Particular projects.--Of the dollar amount in 
                subparagraph (A), the Secretary is authorized to 
                certify--
                            ``(i) $800,000,000 for integrated 
                        gasification combined cycle projects the 
                        application for which is submitted during the 
                        period described in paragraph (2)(A)(i),
                            ``(ii) $500,000,000 for projects which use 
                        other advanced coal-based generation 
                        technologies the application for which is 
                        submitted during the period described in 
                        paragraph (2)(A)(i), and
                            ``(iii) $950,000,000 for advanced coal-
                        based generation technology projects the 
                        application for which is submitted during the 
                        period described in paragraph (2)(A)(ii).''.
            (2) Application period for additional projects.--
        Subparagraph (A) of section 48A(d)(2) is amended to read as 
        follows:
                    ``(A) Application period.--Each applicant for 
                certification under this paragraph shall submit an 
                application meeting the requirements of subparagraph 
                (B). An applicant may only submit an application--
                            ``(i) for an allocation from the dollar 
                        amount specified in clause (i) or (ii) of 
                        paragraph (3)(B) during the 3-year period 
                        beginning on the date the Secretary establishes 
                        the program under paragraph (1), and
                            ``(ii) for an allocation from the dollar 
                        amount specified in paragraph (3)(B)(iii) 
                        during the 3-year period beginning at the 
                        earlier of the termination of the period 
                        described in clause (i) or the date prescribed 
                        by the Secretary.''.
            (3) Capture and sequestration of carbon dioxide emissions 
        requirement.--
                    (A) In general.--Section 48A(e)(1) is amended by 
                striking ``and'' at the end of subparagraph (E), by 
                striking the period at the end of subparagraph (F) and 
                inserting ``; and'', and by adding at the end the 
                following new subparagraph:
                    ``(G) in the case of any project the application 
                for which is submitted during the period described in 
                subsection (d)(2)(A)(ii), the project includes 
                equipment which separates and sequesters at least 65 
                percent (70 percent in the case of an application for 
                reallocated credits under subsection (d)(4)) of such 
                project's total carbon dioxide emissions.''.
                    (B) Highest priority for projects which sequester 
                carbon dioxide emissions.--Section 48A(e)(3) is amended 
                by striking ``and'' at the end of subparagraph 
                (A)(iii), by striking the period at the end of 
                subparagraph (B)(iii) and inserting ``, and'', and by 
                adding at the end the following new subparagraph:
                    ``(C) give highest priority to projects with the 
                greatest separation and sequestration percentage of 
                total carbon dioxide emissions.''.
                    (C) Recapture of credit for failure to sequester.--
                Section 48A is amended by adding at the end the 
                following new subsection:
    ``(i) Recapture of Credit for Failure To Sequester.--The Secretary 
shall provide for recapturing the benefit of any credit allowable under 
subsection (a) with respect to any project which fails to attain or 
maintain the separation and sequestration requirements of subsection 
(e)(1)(G).''.
            (4) Additional priority for research partnerships.--Section 
        48A(e)(3)(B), as amended by paragraph (3)(B), is amended--
                    (A) by striking ``and'' at the end of clause (ii),
                    (B) by redesignating clause (iii) as clause (iv), 
                and
                    (C) by inserting after clause (ii) the following 
                new clause:
                            ``(iii) applicant participants who have a 
                        research partnership with an eligible 
                        educational institution (as defined in section 
                        529(e)(5)), and''.
            (5) Clerical amendment.--Section 48A(e)(3) is amended by 
        striking ``integrated gasification combined cycle'' in the 
        heading and inserting ``certain''.
    (d) Disclosure of Allocations.--Section 48A(d) is amended by adding 
at the end the following new paragraph:
            ``(5) Disclosure of allocations.--The Secretary shall, upon 
        making a certification under this subsection or section 48B(d), 
        publicly disclose the identity of the applicant and the amount 
        of the credit certified with respect to such applicant.''.
    (e) Effective Dates.--
            (1) In general.--Except as otherwise provided in this 
        subsection, the amendments made by this section shall apply to 
        credits the application for which is submitted during the 
        period described in section 48A(d)(2)(A)(ii) of the Internal 
        Revenue Code of 1986 and which are allocated or reallocated 
        after the date of the enactment of this Act.
            (2) Disclosure of allocations.--The amendment made by 
        subsection (d) shall apply to certifications made after the 
        date of the enactment of this Act.
            (3) Clerical amendment.--The amendment made by subsection 
        (c)(5) shall take effect as if included in the amendment made 
        by section 1307(b) of the Energy Tax Incentives Act of 2005.

SEC. 812. EXPANSION AND MODIFICATION OF COAL GASIFICATION INVESTMENT 
              CREDIT.

    (a) Modification of Credit Amount.--Section 48B(a) is amended by 
inserting ``(30 percent in the case of credits allocated under 
subsection (d)(1)(B))'' after ``20 percent''.
    (b) Expansion of Aggregate Credits.--Section 48B(d)(1) is amended 
by striking ``shall not exceed $350,000,000'' and all that follows and 
inserting ``shall not exceed--
                    ``(A) $350,000,000, plus
                    ``(B) $150,000,000 for qualifying gasification 
                projects that include equipment which separates and 
                sequesters at least 75 percent of such project's total 
                carbon dioxide emissions.''.
    (c) Recapture of Credit for Failure To Sequester.--Section 48B is 
amended by adding at the end the following new subsection:
    ``(f) Recapture of Credit for Failure To Sequester.--The Secretary 
shall provide for recapturing the benefit of any credit allowable under 
subsection (a) with respect to any project which fails to attain or 
maintain the separation and sequestration requirements for such project 
under subsection (d)(1).''.
    (d) Selection Priorities.--Section 48B(d) is amended by adding at 
the end the following new paragraph:
            ``(4) Selection priorities.--In determining which 
        qualifying gasification projects to certify under this section, 
        the Secretary shall--
                    ``(A) give highest priority to projects with the 
                greatest separation and sequestration percentage of 
                total carbon dioxide emissions, and
                    ``(B) give high priority to applicant participants 
                who have a research partnership with an eligible 
                educational institution (as defined in section 
                529(e)(5)).''.
    (e) Effective Date.--The amendments made by this section shall 
apply to credits described in section 48B(d)(1)(B) of the Internal 
Revenue Code of 1986 which are allocated or reallocated after the date 
of the enactment of this Act.

SEC. 813. TEMPORARY INCREASE IN COAL EXCISE TAX.

    Paragraph (2) of section 4121(e) is amended--
            (1) by striking ``January 1, 2014'' in subparagraph (A) and 
        inserting ``December 31, 2018'', and
            (2) by striking ``January 1 after 1981'' in subparagraph 
        (B) and inserting ``December 31 after 2007''.

SEC. 814. SPECIAL RULES FOR REFUND OF THE COAL EXCISE TAX TO CERTAIN 
              COAL PRODUCERS AND EXPORTERS.

    (a) Refund.--
            (1) Coal producers.--
                    (A) In general.--Notwithstanding subsections (a)(1) 
                and (c) of section 6416 and section 6511 of the 
                Internal Revenue Code of 1986, if--
                            (i) a coal producer establishes that such 
                        coal producer, or a party related to such coal 
                        producer, exported coal produced by such coal 
                        producer to a foreign country or shipped coal 
                        produced by such coal producer to a possession 
                        of the United States, or caused such coal to be 
                        exported or shipped, the export or shipment of 
                        which was other than through an exporter who 
                        meets the requirements of paragraph (2),
                            (ii) such coal producer filed an excise tax 
                        return on or after October 1, 1990, and on or 
                        before the date of the enactment of this Act, 
                        and
                            (iii) such coal producer files a claim for 
                        refund with the Secretary not later than the 
                        close of the 30-day period beginning on the 
                        date of the enactment of this Act,
                then the Secretary shall pay to such coal producer an 
                amount equal to the tax paid under section 4121 of such 
                Code on such coal exported or shipped by the coal 
                producer or a party related to such coal producer, or 
                caused by the coal producer or a party related to such 
                coal producer to be exported or shipped.
                    (B) Special rules for certain taxpayers.--For 
                purposes of this section--
                            (i) In general.--If a coal producer or a 
                        party related to a coal producer has received a 
                        judgment described in clause (iii), such coal 
                        producer shall be deemed to have established 
                        the export of coal to a foreign country or 
                        shipment of coal to a possession of the United 
                        States under subparagraph (A)(i).
                            (ii) Amount of payment.--If a taxpayer 
                        described in clause (i) is entitled to a 
                        payment under subparagraph (A), the amount of 
                        such payment shall be reduced by any amount 
                        paid pursuant to the judgment described in 
                        clause (iii).
                            (iii) Judgment described.--A judgment is 
                        described in this subparagraph if such 
                        judgment--
                                    (I) is made by a court of competent 
                                jurisdiction within the United States,
                                    (II) relates to the 
                                constitutionality of any tax paid on 
                                exported coal under section 4121 of the 
                                Internal Revenue Code of 1986, and
                                    (III) is in favor of the coal 
                                producer or the party related to the 
                                coal producer.
            (2) Exporters.--Notwithstanding subsections (a)(1) and (c) 
        of section 6416 and section 6511 of the Internal Revenue Code 
        of 1986, and a judgment described in paragraph (1)(B)(iii) of 
        this subsection, if--
                    (A) an exporter establishes that such exporter 
                exported coal to a foreign country or shipped coal to a 
                possession of the United States, or caused such coal to 
                be so exported or shipped,
                    (B) such exporter filed a tax return on or after 
                October 1, 1990, and on or before the date of the 
                enactment of this Act, and
                    (C) such exporter files a claim for refund with the 
                Secretary not later than the close of the 30-day period 
                beginning on the date of the enactment of this Act,
        then the Secretary shall pay to such exporter an amount equal 
        to $0.825 per ton of such coal exported by the exporter or 
        caused to be exported or shipped, or caused to be exported or 
        shipped, by the exporter.
    (b) Limitations.--Subsection (a) shall not apply with respect to 
exported coal if a settlement with the Federal Government has been made 
with and accepted by, the coal producer, a party related to such coal 
producer, or the exporter, of such coal, as of the date that the claim 
is filed under this section with respect to such exported coal. For 
purposes of this subsection, the term ``settlement with the Federal 
Government'' shall not include any settlement or stipulation entered 
into as of the date of the enactment of this Act, the terms of which 
contemplate a judgment concerning which any party has reserved the 
right to file an appeal, or has filed an appeal.
    (c) Subsequent Refund Prohibited.--No refund shall be made under 
this section to the extent that a credit or refund of such tax on such 
exported or shipped coal has been paid to any person.
    (d) Definitions.--For purposes of this section--
            (1) Coal producer.--The term ``coal producer'' means the 
        person in whom is vested ownership of the coal immediately 
        after the coal is severed from the ground, without regard to 
        the existence of any contractual arrangement for the sale or 
        other disposition of the coal or the payment of any royalties 
        between the producer and third parties. The term includes any 
        person who extracts coal from coal waste refuse piles or from 
        the silt waste product which results from the wet washing (or 
        similar processing) of coal.
            (2) Exporter.--The term ``exporter'' means a person, other 
        than a coal producer, who does not have a contract, fee 
        arrangement, or any other agreement with a producer or seller 
        of such coal to export or ship such coal to a third party on 
        behalf of the producer or seller of such coal and--
                    (A) is indicated in the shipper's export 
                declaration or other documentation as the exporter of 
                record, or
                    (B) actually exported such coal to a foreign 
                country or shipped such coal to a possession of the 
                United States, or caused such coal to be so exported or 
                shipped.
            (3) Related party.--The term ``a party related to such coal 
        producer'' means a person who--
                    (A) is related to such coal producer through any 
                degree of common management, stock ownership, or voting 
                control,
                    (B) is related (within the meaning of section 
                144(a)(3) of the Internal Revenue Code of 1986) to such 
                coal producer, or
                    (C) has a contract, fee arrangement, or any other 
                agreement with such coal producer to sell such coal to 
                a third party on behalf of such coal producer.
            (4) Secretary.--The term ``Secretary'' means the Secretary 
        of Treasury or the Secretary's designee.
    (e) Timing of Refund.--With respect to any claim for refund filed 
pursuant to this section, the Secretary shall determine whether the 
requirements of this section are met not later than 180 days after such 
claim is filed. If the Secretary determines that the requirements of 
this section are met, the claim for refund shall be paid not later than 
180 days after the Secretary makes such determination.
    (f) Interest.--Any refund paid pursuant to this section shall be 
paid by the Secretary with interest from the date of overpayment 
determined by using the overpayment rate and method under section 6621 
of the Internal Revenue Code of 1986.
    (g) Denial of Double Benefit.--The payment under subsection (a) 
with respect to any coal shall not exceed--
            (1) in the case of a payment to a coal producer, the amount 
        of tax paid under section 4121 of the Internal Revenue Code of 
        1986 with respect to such coal by such coal producer or a party 
        related to such coal producer, and
            (2) in the case of a payment to an exporter, an amount 
        equal to $0.825 per ton with respect to such coal exported by 
        the exporter or caused to be exported by the exporter.
    (h) Application of Section.--This section applies only to claims on 
coal exported or shipped on or after October 1, 1990, through the date 
of the enactment of this Act.
    (i) Standing Not Conferred.--
            (1) Exporters.--With respect to exporters, this section 
        shall not confer standing upon an exporter to commence, or 
        intervene in, any judicial or administrative proceeding 
        concerning a claim for refund by a coal producer of any Federal 
        or State tax, fee, or royalty paid by the coal producer.
            (2) Coal producers.--With respect to coal producers, this 
        section shall not confer standing upon a coal producer to 
        commence, or intervene in, any judicial or administrative 
        proceeding concerning a claim for refund by an exporter of any 
        Federal or State tax, fee, or royalty paid by the producer and 
        alleged to have been passed on to an exporter.

SEC. 815. CARBON AUDIT OF THE TAX CODE.

    (a) Study.--The Secretary of the Treasury shall enter into an 
agreement with the National Academy of Sciences to undertake a 
comprehensive review of the Internal Revenue Code of 1986 to identify 
the types of and specific tax provisions that have the largest effects 
on carbon and other greenhouse gas emissions and to estimate the 
magnitude of those effects.
    (b) Report.--Not later than 2 years after the date of enactment of 
this Act, the National Academy of Sciences shall submit to Congress a 
report containing the results of study authorized under this section.
    (c) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $1,500,000 for the period of 
fiscal years 2009 and 2010.

    Subtitle B--Transportation and Domestic Fuel Security Provisions

SEC. 821. INCLUSION OF CELLULOSIC BIOFUEL IN BONUS DEPRECIATION FOR 
              BIOMASS ETHANOL PLANT PROPERTY.

    (a) In General.--Paragraph (3) of section 168(l) is amended to read 
as follows:
            ``(3) Cellulosic biofuel.--The term `cellulosic biofuel' 
        means any liquid fuel which is produced from any 
        lignocellulosic or hemicellulosic matter that is available on a 
        renewable or recurring basis.''.
    (b) Conforming Amendments.--Subsection (l) of section 168 is 
amended--
            (1) by striking ``cellulosic biomass ethanol'' each place 
        it appears and inserting ``cellulosic biofuel'',
            (2) by striking ``Cellulosic Biomass Ethanol'' in the 
        heading of such subsection and inserting ``Cellulosic 
        Biofuel'', and
            (3) by striking ``cellulosic biomass ethanol'' in the 
        heading of paragraph (2) thereof and inserting ``cellulosic 
        biofuel''.
    (c) Effective Date.--The amendments made by this section shall 
apply to property placed in service after the date of the enactment of 
this Act, in taxable years ending after such date.

SEC. 822. CREDITS FOR BIODIESEL AND RENEWABLE DIESEL.

    (a) In General.--Sections 40A(g), 6426(c)(6), and 6427(e)(5)(B) are 
each amended by striking ``December 31, 2008'' and inserting ``December 
31, 2009''.
    (b) Increase in Rate of Credit.--
            (1) Income tax credit.--Paragraphs (1)(A) and (2)(A) of 
        section 40A(b) are each amended by striking ``50 cents'' and 
        inserting ``$1.00''.
            (2) Excise tax credit.--Paragraph (2) of section 6426(c) is 
        amended to read as follows:
            ``(2) Applicable amount.--For purposes of this subsection, 
        the applicable amount is $1.00.''.
            (3) Conforming amendments.--
                    (A) Subsection (b) of section 40A is amended by 
                striking paragraph (3) and by redesignating paragraphs 
                (4) and (5) as paragraphs (3) and (4), respectively.
                    (B) Paragraph (2) of section 40A(f) is amended to 
                read as follows:
            ``(2) Exception.--Subsection (b)(4) shall not apply with 
        respect to renewable diesel.''.
                    (C) Paragraphs (2) and (3) of section 40A(e) are 
                each amended by striking ``subsection (b)(5)(C)'' and 
                inserting ``subsection (b)(4)(C)''.
                    (D) Clause (ii) of section 40A(d)(3)(C) is amended 
                by striking ``subsection (b)(5)(B)'' and inserting 
                ``subsection (b)(4)(B)''.
    (c) Uniform Treatment of Diesel Produced From Biomass.--Paragraph 
(3) of section 40A(f) is amended--
            (1) by striking ``diesel fuel'' and inserting ``liquid 
        fuel'',
            (2) by striking ``using a thermal depolymerization 
        process'', and
            (3) by striking ``or D396'' in subparagraph (B) and 
        inserting ``, D396, or other equivalent standard approved by 
        the Secretary''.
    (d) Coproduction of Renewable Diesel With Petroleum Feedstock.--
            (1) In general.--Paragraph (3) of section 40A(f) (defining 
        renewable diesel) is amended by adding at the end the following 
        flush sentence:
        ``Such term does not include any fuel derived from coprocessing 
        biomass with a feedstock which is not biomass. For purposes of 
        this paragraph, the term `biomass' has the meaning given such 
        term by section 45K(c)(3).''.
            (2) Conforming amendment.--Paragraph (3) of section 40A(f) 
        is amended by striking ``(as defined in section 45K(c)(3))''.
    (e) Eligibility of Certain Aviation Fuel.--Subsection (f) of 
section 40A (relating to renewable diesel) is amended by adding at the 
end the following new paragraph:
            ``(4) Certain aviation fuel.--
                    ``(A) In general.--Except as provided in the last 
                three sentences of paragraph (3), the term `renewable 
                diesel' shall include fuel derived from biomass which 
                meets the requirements of a Department of Defense 
                specification for military jet fuel or an American 
                Society of Testing and Materials specification for 
                aviation turbine fuel.
                    ``(B) Application of mixture credits.--In the case 
                of fuel which is treated as renewable diesel solely by 
                reason of subparagraph (A), subsection (b)(1) and 
                section 6426(c) shall be applied with respect to such 
                fuel by treating kerosene as though it were diesel 
                fuel.''.
    (f) Effective Date.--
            (1) In general.--Except as otherwise provided in this 
        subsection, the amendments made by this section shall apply to 
        fuel produced, and sold or used, after December 31, 2008.
            (2) Coproduction of renewable diesel with petroleum 
        feedstock.--The amendments made by subsection (c) shall apply 
        to fuel produced, and sold or used, after February 13, 2008.

SEC. 823. CLARIFICATION THAT CREDITS FOR FUEL ARE DESIGNED TO PROVIDE 
              AN INCENTIVE FOR UNITED STATES PRODUCTION.

    (a) Alcohol Fuels Credit.--Subsection (d) of section 40 is amended 
by adding at the end the following new paragraph:
            ``(7) Limitation to alcohol with connection to the united 
        states.--No credit shall be determined under this section with 
        respect to any alcohol which is produced outside the United 
        States for use as a fuel outside the United States. For 
        purposes of this paragraph, the term `United States' includes 
        any possession of the United States.''.
    (b) Biodiesel Fuels Credit.--Subsection (d) of section 40A is 
amended by adding at the end the following new paragraph:
            ``(5) Limitation to biodiesel with connection to the united 
        states.--No credit shall be determined under this section with 
        respect to any biodiesel which is produced outside the United 
        States for use as a fuel outside the United States. For 
        purposes of this paragraph, the term `United States' includes 
        any possession of the United States.''.
    (c) Excise Tax Credit.--
            (1) In general.--Section 6426 is amended by adding at the 
        end the following new subsection:
    ``(i) Limitation to Fuels With Connection to the United States.--
            ``(1) Alcohol.--No credit shall be determined under this 
        section with respect to any alcohol which is produced outside 
        the United States for use as a fuel outside the United States.
            ``(2) Biodiesel and alternative fuels.--No credit shall be 
        determined under this section with respect to any biodiesel or 
        alternative fuel which is produced outside the United States 
        for use as a fuel outside the United States.
For purposes of this subsection, the term `United States' includes any 
possession of the United States.''.
            (2) Conforming amendment.--Subsection (e) of section 6427 
        is amended by redesignating paragraph (5) as paragraph (6) and 
        by inserting after paragraph (4) the following new paragraph:
            ``(5) Limitation to fuels with connection to the united 
        states.--No amount shall be payable under paragraph (1) or (2) 
        with respect to any mixture or alternative fuel if credit is 
        not allowed with respect to such mixture or alternative fuel by 
        reason of section 6426(i).''.
    (d) Effective Date.--The amendments made by this section shall 
apply to claims for credit or payment made on or after May 15, 2008.

SEC. 824. CREDIT FOR NEW QUALIFIED PLUG-IN ELECTRIC DRIVE MOTOR 
              VEHICLES.

    (a) In General.--Section 30 is amended to read as follows:

``SEC. 30. NEW QUALIFIED PLUG-IN ELECTRIC DRIVE MOTOR VEHICLES.

    ``(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 sum of the credit amounts determined under subsection (b) 
with respect to each new qualified plug-in electric drive motor vehicle 
placed in service by the taxpayer during the taxable year.
    ``(b) Per Vehicle Dollar Limitation.--
            ``(1) In general.--The amount determined under this 
        subsection with respect to any new qualified plug-in electric 
        drive motor vehicle is the sum of the amounts determined under 
        paragraphs (2) and (3) with respect to such vehicle.
            ``(2) Base amount.--The amount determined under this 
        paragraph is $3,000.
            ``(3) Battery capacity.--In the case of a vehicle which 
        draws propulsion energy from a battery with not less than 5 
        kilowatt hours of capacity, the amount determined under this 
        paragraph is $200, plus $200 for each kilowatt hour of capacity 
        in excess of 5 kilowatt hours. The amount determined under this 
        paragraph shall not exceed $2,000.
    ``(c) Application With Other Credits.--
            ``(1) Business credit treated as part of general business 
        credit.--So much of the credit which would be allowed under 
        subsection (a) for any taxable year (determined without regard 
        to this subsection) that is attributable to property of a 
        character subject to an allowance for depreciation shall be 
        treated as a credit listed in section 38(b) for such taxable 
        year (and not allowed under subsection (a)).
            ``(2) Personal credit.--
                    ``(A) In general.--For purposes of this title, the 
                credit allowed under subsection (a) for any taxable 
                year (determined after application of paragraph (1)) 
                shall be treated as a credit allowable under subpart A 
                for such taxable year.
                    ``(B) Limitation based on amount of tax.--In the 
                case of a taxable year to which section 26(a)(2) does 
                not apply, the credit allowed under subsection (a) for 
                any taxable year (determined after application of 
                paragraph (1)) shall not exceed the excess of--
                            ``(i) the sum of the regular tax liability 
                        (as defined in section 26(b)) plus the tax 
                        imposed by section 55, over
                            ``(ii) the sum of the credits allowable 
                        under subpart A (other than this section and 
                        sections 23 and 25D) and section 27 for the 
                        taxable year.
    ``(d) New Qualified Plug-In Electric Drive Motor Vehicle.--For 
purposes of this section--
            ``(1) In general.--The term `new qualified plug-in electric 
        drive motor vehicle' means a motor vehicle--
                    ``(A) the original use of which commences with the 
                taxpayer,
                    ``(B) which is acquired for use or lease by the 
                taxpayer and not for resale,
                    ``(C) which is made by a manufacturer,
                    ``(D) which has a gross vehicle weight rating of 
                less than 14,000 pounds,
                    ``(E) which has received a certificate of 
                conformity under the Clean Air Act and meets or exceeds 
                the Bin 5 Tier II emission standard established in 
                regulations prescribed by the Administrator of the 
                Environmental Protection Agency under section 202(i) of 
                the Clean Air Act for that make and model year vehicle, 
                and
                    ``(F) which is propelled to a significant extent by 
                an electric motor which draws electricity from a 
                battery which--
                            ``(i) has a capacity of not less than 4 
                        kilowatt hours, and
                            ``(ii) is capable of being recharged from 
                        an external source of electricity.
            ``(2) Exception.--The term `new qualified plug-in electric 
        drive motor vehicle' 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.
            ``(3) Motor vehicle.--The term `motor vehicle' means any 
        vehicle which is manufactured primarily for use on public 
        streets, roads, and highways (not including a vehicle operated 
        exclusively on a rail or rails) and which has at least 4 
        wheels.
            ``(4) Other terms.--The terms `passenger automobile', 
        `light truck', and `manufacturer' have the meanings given such 
        terms in regulations prescribed by the Administrator of the 
        Environmental Protection Agency for purposes of the 
        administration of title II of the Clean Air Act (42 U.S.C. 7521 
        et seq.).
            ``(5) Battery capacity.--The term `capacity' means, with 
        respect to any battery, the quantity of electricity which the 
        battery is capable of storing, expressed in kilowatt hours, as 
        measured from a 100 percent state of charge to a 0 percent 
        state of charge.
    ``(e) Limitation on Number of New Qualified Plug-In Electric Drive 
Motor Vehicles Eligible for Credit.--
            ``(1) In general.--In the case of a new qualified plug-in 
        electric drive motor vehicle sold during the phaseout period, 
        only the applicable percentage of the credit otherwise 
        allowable under subsection (a) shall be allowed.
            ``(2) Phaseout period.--For purposes of this subsection, 
        the phaseout period is the period beginning with the second 
        calendar quarter following the calendar quarter which includes 
        the first date on which the number of new qualified plug-in 
        electric drive motor vehicles manufactured by the manufacturer 
        of the vehicle referred to in paragraph (1) sold for use in the 
        United States after the date of the enactment of this section, 
        is at least 60,000.
            ``(3) Applicable percentage.--For purposes of paragraph 
        (1), the applicable percentage is--
                    ``(A) 50 percent for the first 2 calendar quarters 
                of the phaseout period,
                    ``(B) 25 percent for the 3d and 4th calendar 
                quarters of the phaseout period, and
                    ``(C) 0 percent for each calendar quarter 
                thereafter.
            ``(4) Controlled groups.--Rules similar to the rules of 
        section 30B(f)(4) shall apply for purposes of this subsection.
    ``(f) Special Rules.--
            ``(1) Basis reduction.--The basis of any property for which 
        a credit is allowable under subsection (a) shall be reduced by 
        the amount of such credit (determined without regard to 
        subsection (c)).
            ``(2) Recapture.--The Secretary shall, by regulations, 
        provide for recapturing the benefit of any credit allowable 
        under subsection (a) with respect to any property which ceases 
        to be property eligible for such credit.
            ``(3) Property used outside united states, etc., not 
        qualified.--No credit shall be allowed under subsection (a) 
        with respect to any property referred to in section 50(b)(1) or 
        with respect to the portion of the cost of any property taken 
        into account under section 179.
            ``(4) Election not to take credit.--No credit shall be 
        allowed under subsection (a) for any vehicle if the taxpayer 
        elects to not have this section apply to such vehicle.
            ``(5) Property used by tax-exempt entity; interaction with 
        air quality and motor vehicle safety standards.--Rules similar 
        to the rules of paragraphs (6) and (10) of section 30B(h) shall 
        apply for purposes of this section.''.
    (b) Coordination With Alternative Motor Vehicle Credit.--Section 
30B(d)(3) is amended by adding at the end the following new 
subparagraph:
                    ``(D) Exclusion of plug-in vehicles.--Any vehicle 
                with respect to which a credit is allowable under 
                section 30 (determined without regard to subsection (c) 
                thereof) shall not be taken into account under this 
                section.''.
    (c) Credit Made Part of General Business Credit.--Section 38(b) is 
amended by striking ``plus'' at the end of paragraph (32), by striking 
the period at the end of paragraph (33) and inserting ``, plus'', and 
by adding at the end the following new paragraph:
            ``(34) the portion of the new qualified plug-in electric 
        drive motor vehicle credit to which section 30(c)(1) 
        applies.''.
    (d) Conforming Amendments.--
            (1)(A) Section 24(b)(3)(B), as amended by section 804, is 
        amended by striking ``and 25D'' and inserting ``25D, and 30''.
            (B) Section 25(e)(1)(C)(ii) is amended by inserting ``30,'' 
        after ``25D,''.
            (C) Section 25B(g)(2), as amended by section 804, is 
        amended by striking ``and 25D'' and inserting ``, 25D, and 
        30''.
            (D) Section 26(a)(1), as amended by section 804, is amended 
        by striking ``and 25D'' and inserting ``25D, and 30''.
            (E) Section 1400C(d)(2) is amended by striking ``and 25D'' 
        and inserting ``25D, and 30''.
            (2) Section 30B(h)(1) is amended by striking ``section 
        30(c)(2)'' and inserting ``section 30(d)(3)''.
            (3)(A) Section 53(d)(1)(B) is amended by striking clause 
        (iii) and redesignating clause (iv) as clause (iii).
            (B) Subclause (II) of section 53(d)(1)(B)(iii), as so 
        redesignated, is amended by striking ``increased in the manner 
        provided in clause (iii)''.
            (4) Section 55(c)(3) is amended by striking ``30(b)(3),''.
            (5) Section 1016(a)(25) is amended by striking ``section 
        30(d)(1)'' and inserting ``section 30(f)(1)''.
            (6) Section 6501(m) is amended by striking ``section 
        30(d)(4)'' and inserting ``section 30(f)(4)''.
            (7) The item in the table of sections for subpart B of part 
        IV of subchapter A of chapter 1 is amended to read as follows:

``Sec. 30. New qualified plug-in electric drive motor vehicles.''.
    (e) Treatment of Alternative Motor Vehicle Credit as a Personal 
Credit.--
            (1) In general.--Paragraph (2) of section 30B(g) is amended 
        to read as follows:
            ``(2) Personal credit.--The credit allowed under subsection 
        (a) for any taxable year (after application of paragraph (1)) 
        shall be treated as a credit allowable under subpart A for such 
        taxable year.''.
            (2) Conforming amendments.--
                    (A) Subparagraph (A) of section 30C(d)(2) is 
                amended by striking ``sections 27, 30, and 30B'' and 
                inserting ``section 27''.
                    (B) Paragraph (3) of section 55(c) is amended by 
                striking ``30B(g)(2),''.
    (f) Effective Date.--
            (1) In general.--Except as otherwise provided in this 
        subsection, the amendments made by this section shall apply to 
        taxable years beginning after December 31, 2008.
            (2) Treatment of alternative motor vehicle credit as 
        personal credit.--The amendments made by subsection (e) shall 
        apply to taxable years beginning after December 31, 2007.
    (g) Application of EGTRRA Sunset.--The amendment made by subsection 
(d)(1)(A) shall be subject to title IX of the Economic Growth and Tax 
Relief Reconciliation Act of 2001 in the same manner as the provision 
of such Act to which such amendment relates.

SEC. 825. EXCLUSION FROM HEAVY TRUCK TAX FOR IDLING REDUCTION UNITS AND 
              ADVANCED INSULATION.

    (a) In General.--Section 4053 is amended by adding at the end the 
following new paragraphs:
            ``(9) Idling reduction device.--Any device or system of 
        devices which--
                    ``(A) is designed to provide to a 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 one or 
                more devices affixed to a tractor, and
                    ``(B) is determined by the Administrator of the 
                Environmental Protection Agency, in consultation with 
                the Secretary of Energy and the Secretary of 
                Transportation, to reduce idling of such vehicle at a 
                motor vehicle rest stop or other location where such 
                vehicles are temporarily parked or remain stationary.
            ``(10) Advanced insulation.--Any insulation that has an R 
        value of not less than R35 per inch.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to sales or installations after the date of the enactment of this Act.

SEC. 826. RESTRUCTURING OF NEW YORK LIBERTY ZONE TAX CREDITS.

    (a) In General.--Part I of subchapter Y of chapter 1 is amended by 
redesignating section 1400L as section 1400K and by adding at the end 
the following new section:

``SEC. 1400L. NEW YORK LIBERTY ZONE TAX CREDITS.

    ``(a) In General.--In the case of a New York Liberty Zone 
governmental unit, there shall be allowed as a credit against any taxes 
imposed for any payroll period by section 3402 for which such 
governmental unit is liable under section 3403 an amount equal to so 
much of the portion of the qualifying project expenditure amount 
allocated under subsection (b)(3) to such governmental unit for the 
calendar year as is allocated by such governmental unit to such period 
under subsection (b)(4).
    ``(b) Qualifying Project Expenditure Amount.--For purposes of this 
section--
            ``(1) In general.--The term `qualifying project expenditure 
        amount' means, with respect to any calendar year, the sum of--
                    ``(A) the total expenditures paid or incurred 
                during such calendar year by all New York Liberty Zone 
                governmental units and the Port Authority of New York 
                and New Jersey for any portion of qualifying projects 
                located wholly within the City of New York, New York, 
                and
                    ``(B) any such expenditures--
                            ``(i) paid or incurred in any preceding 
                        calendar year which begins after the date of 
                        enactment of this section, and
                            ``(ii) not previously allocated under 
                        paragraph (3).
            ``(2) Qualifying project.--The term `qualifying project' 
        means any transportation infrastructure project, including 
        highways, mass transit systems, railroads, airports, ports, and 
        waterways, in or connecting with the New York Liberty Zone (as 
        defined in section 1400K(h)), which is designated as a 
        qualifying project under this section jointly by the Governor 
        of the State of New York and the Mayor of the City of New York, 
        New York.
            ``(3) General allocation.--
                    ``(A) In general.--The Governor of the State of New 
                York and the Mayor of the City of New York, New York, 
                shall jointly allocate to each New York Liberty Zone 
                governmental unit the portion of the qualifying project 
                expenditure amount which may be taken into account by 
                such governmental unit under subsection (a) for any 
                calendar year in the credit period.
                    ``(B) Aggregate limit.--The aggregate amount which 
                may be allocated under subparagraph (A) for all 
                calendar years in the credit period shall not exceed 
                $2,000,000,000.
                    ``(C) Annual limit.--The aggregate amount which may 
                be allocated under subparagraph (A) for any calendar 
                year in the credit period shall not exceed the sum of--
                            ``(i) $115,000,000 ($425,000,000 in the 
                        case of the last 2 years in the credit period), 
                        plus
                            ``(ii) the aggregate amount authorized to 
                        be allocated under this paragraph for all 
                        preceding calendar years in the credit period 
                        which was not so allocated.
                    ``(D) Unallocated amounts at end of credit 
                period.--If, as of the close of the credit period, the 
                amount under subparagraph (B) exceeds the aggregate 
                amount allocated under subparagraph (A) for all 
                calendar years in the credit period, the Governor of 
                the State of New York and the Mayor of the City of New 
                York, New York, may jointly allocate to New York 
                Liberty Zone governmental units for any calendar year 
                in the 5-year period following the credit period an 
                amount equal to--
                            ``(i) the lesser of--
                                    ``(I) such excess, or
                                    ``(II) the qualifying project 
                                expenditure amount for such calendar 
                                year, reduced by
                            ``(ii) the aggregate amount allocated under 
                        this subparagraph for all preceding calendar 
                        years.
            ``(4) Allocation to payroll periods.--Each New York Liberty 
        Zone governmental unit which has been allocated a portion of 
        the qualifying project expenditure amount under paragraph (3) 
        for a calendar year may allocate such portion to payroll 
        periods beginning in such calendar year as such governmental 
        unit determines appropriate.
    ``(c) Carryover of Unused Allocations.--
            ``(1) In general.--Except as provided in paragraph (2), if 
        the amount allocated under subsection (b)(3) to a New York 
        Liberty Zone governmental unit for any calendar year exceeds 
        the aggregate taxes imposed by section 3402 for which such 
        governmental unit is liable under section 3403 for periods 
        beginning in such year, such excess shall be carried to the 
        succeeding calendar year and added to the allocation of such 
        governmental unit for such succeeding calendar year.
            ``(2) Reallocation.--If a New York Liberty Zone 
        governmental unit does not use an amount allocated to it under 
        subsection (b)(3) within the time prescribed by the Governor of 
        the State of New York and the Mayor of the City of New York, 
        New York, then such amount shall after such time be treated for 
        purposes of subsection (b)(3) in the same manner as if it had 
        never been allocated.
    ``(d) Definitions and Special Rules.--For purposes of this 
section--
            ``(1) Credit period.--The term `credit period' means the 
        12-year period beginning on January 1, 2009.
            ``(2) New york liberty zone governmental unit.--The term 
        `New York Liberty Zone governmental unit' means--
                    ``(A) the State of New York,
                    ``(B) the City of New York, New York, and
                    ``(C) any agency or instrumentality of such State 
                or City.
            ``(3) Treatment of funds.--Any expenditure for a qualifying 
        project taken into account for purposes of the credit under 
        this section shall be considered State and local funds for the 
        purpose of any Federal program.
            ``(4) Treatment of credit amounts for purposes of 
        withholding taxes.--For purposes of this title, a New York 
        Liberty Zone governmental unit shall be treated as having paid 
        to the Secretary, on the day on which wages are paid to 
        employees, an amount equal to the amount of the credit allowed 
        to such entity under subsection (a) with respect to such wages, 
        but only if such governmental unit deducts and withholds wages 
        for such payroll period under section 3401 (relating to wage 
        withholding).
    ``(e) Reporting.--The Governor of the State of New York and the 
Mayor of the City of New York, New York, shall jointly submit to the 
Secretary an annual report--
            ``(1) which certifies--
                    ``(A) the qualifying project expenditure amount for 
                the calendar year, and
                    ``(B) the amount allocated to each New York Liberty 
                Zone governmental unit under subsection (b)(3) for the 
                calendar year, and
            ``(2) includes such other information as the Secretary may 
        require to carry out this section.
    ``(f) Guidance.--The Secretary may prescribe such guidance as may 
be necessary or appropriate to ensure compliance with the purposes of 
this section.''.
    (b) Termination of Special Allowance and Expensing.--Subparagraph 
(A) of section 1400K(b)(2), as redesignated by subsection (a), is 
amended by striking the parenthetical therein and inserting ``(in the 
case of nonresidential real property and residential rental property, 
the date of the enactment of the Energy Tax Incentives Act of 2008 or, 
if acquired pursuant to a binding contract in effect on such enactment 
date, December 31, 2009)''.
    (c) Conforming Amendments.--
            (1) Section 38(c)(3)(B) is amended by striking ``section 
        1400L(a)'' and inserting ``section 1400K(a)''.
            (2) Section 168(k)(2)(D)(ii) is amended by striking 
        ``section 1400L(c)(2)'' and inserting ``section 1400K(c)(2)''.
            (3) The table of sections for part I of subchapter Y of 
        chapter 1 is amended by redesignating the item relating to 
        section 1400L as an item relating to section 1400K and by 
        inserting after such item the following new item:

``Sec. 1400L. New York Liberty Zone tax credits.''.
    (d) Effective Date.--The amendments made by this section shall take 
effect on the date of the enactment of this Act.

SEC. 827. TRANSPORTATION FRINGE BENEFIT TO BICYCLE COMMUTERS.

    (a) In General.--Paragraph (1) of section 132(f) is amended by 
adding at the end the following:
                    ``(D) Any qualified bicycle commuting 
                reimbursement.''.
    (b) Limitation on Exclusion.--Paragraph (2) of section 132(f) is 
amended by striking ``and'' at the end of subparagraph (A), by striking 
the period at the end of subparagraph (B) and inserting ``, and'', and 
by adding at the end the following new subparagraph:
                    ``(C) the applicable annual limitation in the case 
                of any qualified bicycle commuting reimbursement.''.
    (c) Definitions.--Paragraph (5) of section 132(f) is amended by 
adding at the end the following:
                    ``(F) Definitions related to bicycle commuting 
                reimbursement.--
                            ``(i) Qualified bicycle commuting 
                        reimbursement.--The term `qualified bicycle 
                        commuting reimbursement' means, with respect to 
                        any calendar year, any employer reimbursement 
                        during the 15-month period beginning with the 
                        first day of such calendar year for reasonable 
                        expenses incurred by the employee during such 
                        calendar year for the purchase of a bicycle and 
                        bicycle improvements, repair, and storage, if 
                        such bicycle is regularly used for travel 
                        between the employee's residence and place of 
                        employment.
                            ``(ii) Applicable annual limitation.--The 
                        term `applicable annual limitation' means, with 
                        respect to any employee for any calendar year, 
                        the product of $20 multiplied by the number of 
                        qualified bicycle commuting months during such 
                        year.
                            ``(iii) Qualified bicycle commuting 
                        month.--The term `qualified bicycle commuting 
                        month' means, with respect to any employee, any 
                        month during which such employee--
                                    ``(I) regularly uses the bicycle 
                                for a substantial portion of the travel 
                                between the employee's residence and 
                                place of employment, and
                                    ``(II) does not receive any benefit 
                                described in subparagraph (A), (B), or 
                                (C) of paragraph (1).''.
    (d) Constructive Receipt of Benefit.--Paragraph (4) of section 
132(f) is amended by inserting ``(other than a qualified bicycle 
commuting reimbursement)'' after ``qualified transportation fringe''.
    (e) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2008.

SEC. 828. ALTERNATIVE FUEL VEHICLE REFUELING PROPERTY CREDIT.

    (a) Increase in Credit Amount.--Section 30C is amended--
            (1) by striking ``30 percent'' in subsection (a) and 
        inserting ``50 percent'',
            (2) by striking ``$30,000'' in subsection (b)(1) and 
        inserting ``$50,000'', and
            (3) by striking ``$1,000'' in subsection (b)(2) and 
        inserting ``$2,000''.
    (b) Extension of Credit.--Subsection (g) of section 30C is 
amended--
            (1) by redesignating paragraphs (1) and (2) as paragraphs 
        (2) and (3) and inserting before paragraph (2) (as so 
        redesignated) the following new paragraph:
            ``(1) in the case of property relating to natural gas, 
        compressed natural gas, or liquified natural gas, and which is 
        not of a character subject to an allowance for depreciation, 
        December 31, 2017,'', and
            (2) by striking ``December 31, 2009'' in paragraph (3) (as 
        so redesignated) and inserting ``December 31, 2010''.
    (c) Effective Date.--The amendments made by this section shall 
apply to property placed in service after the date of the enactment of 
this Act, in taxable years ending after such date.

SEC. 829. ENERGY SECURITY BONDS.

    (a) In General.--Subpart I of part IV of subchapter A of chapter 1, 
as amended by sections 806 and 841, is amended by adding at the end the 
following new section:

``SEC. 54E. ENERGY SECURITY BONDS.

    ``(a) Energy Security Bond.--For purposes of this subchapter, the 
term `energy security bond' means any bond issued as part of an issue 
if--
            ``(1) 100 percent of the available project proceeds of such 
        issue are to be used for qualified purposes,
            ``(2) the bond is issued by a qualified issuer,
            ``(3) the issuer designates such bond for purposes of this 
        section, and
            ``(4) repayments of principal and applicable interest on 
        financing provided by the issue are used not later than the 
        close of the 3-month period beginning on the date the repayment 
        (or complete repayment) is received--
                    ``(A) to redeem bonds which are part of the issue, 
                or
                    ``(B) for any qualified purpose.
For purposes of paragraph (4), the term `applicable interest' means so 
much of the interest on any loan as exceeds the amount payable at a 1 
percent rate.
    ``(b) Qualified Purpose.--For purposes of this section--
            ``(1) In general.--The term `qualified purpose' means the 
        making of grants and low-interest loans for the purpose of 
        placing in service natural gas refueling property at retail 
        motor fuel stations located in the United States.
            ``(2) Limitation on loans.--Such term shall not include--
                    ``(A) any loan of more than $200,000 for property 
                located at any one retail motor fuel station, and
                    ``(B) any loan for more than 50 percent of the cost 
                of such property and its installation.
            ``(3) Natural gas refueling property.--The term `natural 
        gas refueling property' means qualified clean-fuel refueling 
        property (as defined in section 179A(d)) which is described in 
        section 179A(d)(3) with respect to natural gas fuel.
            ``(4) Low-interest loan.--The term `low-interest loan' 
        means any loan the rate of interest on which does not exceed 
        the applicable Federal rate in effect under section 1288(b)(1) 
        determined as of the issuance of the loan.
    ``(c) Limitation on Amount of Bonds Designated.--The maximum 
aggregate face amount of bonds which may be designated under subsection 
(a) by any issuer shall not exceed the limitation amount allocated to 
such issuer under subsection (e).
    ``(d) National Limitation on Amount of Bonds Designated.--There is 
a national energy security bond limitation of $1,750,000,000.
    ``(e) Allocation.--
            ``(1) In general.--The Secretary shall make allocations of 
        the amount of the national energy security bond limitation 
        under subsection (d) among qualified issuers in such manner as 
        the Secretary determines appropriate.
            ``(2) Reservation for property in metropolitan area.--50 
        percent of the national energy security bond limitation under 
        subsection (d) may be allocated only for loans to provide 
        natural gas refueling property located in metropolitan 
        statistical areas (within the meaning of section 143(k)(2)(B)).
            ``(3) Percentage of stations receiving loans.--In making 
        allocations under paragraph (1), the Secretary shall attempt to 
        ensure that at least 10 percent of the retail motor fuel 
        stations in the United States received loans from the proceeds 
        of energy security bonds.
    ``(f) Qualified Issuer.--For purposes of this section, the term 
`qualified issuer' means any State or any political subdivision or 
instrumentality thereof.
    ``(g) Termination.--This section shall not apply with respect to 
any bond issued after December 31, 2017.''.
    (b) Coordination With Refueling Property Credit.--Subsection (e) of 
section 30C of such Code is amended by adding at the end the following 
new paragraph:
            ``(6) Coordination with energy security bonds.--The cost 
        otherwise taken into account under this section with respect to 
        any property shall be reduced by the portion of such cost which 
        is financed by any loan provided from the proceeds of any 
        energy security bond (as defined in section 54E).''.
    (c) Conforming Amendments.--
            (1) Paragraph (1) of section 54A(d), as amended by sections 
        806 and 841, is amended by striking ``or'' at the end of 
        subparagraph (B), by adding ``or'' at the end of subparagraph 
        (C), and by inserting after subparagraph (C) the following new 
        subparagraph:
                    ``(D) an energy security bond,''.
            (2) Subparagraph (C) of section 54A(d)(2), as amended by 
        sections 806 and 841, is amended by striking ``and'' at the end 
        of clause (ii), by striking the period at the end of clause 
        (iii) and inserting ``and'', and by adding at the end the 
        following new clause:
                            ``(iv) in the case of an energy security 
                        bond, a purpose specified in section 54E(b).''.
            (3) The table of sections for subpart I of part IV of 
        subchapter A of chapter 1, as amended by sections 806 and 841, 
        is amended by adding at the end the following new item:

``Sec. 54E. Energy security bonds.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to obligations issued after December 31, 2008.

SEC. 830. CERTAIN INCOME AND GAINS RELATING TO ALCOHOL FUELS AND 
              MIXTURES, BIODIESEL FUELS AND MIXTURES, AND ALTERNATIVE 
              FUELS AND MIXTURES TREATED AS QUALIFYING INCOME FOR 
              PUBLICLY TRADED PARTNERSHIPS.

    (a) In General.--Subparagraph (E) of section 7704(d)(1) is amended 
by inserting ``, or the transportation or storage of any fuel described 
in subsection (b), (c), (d), or (e) of section 6426, or any alcohol 
fuel defined in section 6426(b)(4)(A) or any biodiesel fuel as defined 
in section 40A(d)(1)'' after ``timber)''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after the date of the enactment of this Act.

       Subtitle C--Energy Conservation and Efficiency Provisions

SEC. 841. QUALIFIED ENERGY CONSERVATION BONDS.

    (a) In General.--Subpart I of part IV of subchapter A of chapter 1, 
as amended by section 806, is amended by adding at the end the 
following new section:

``SEC. 54D. QUALIFIED ENERGY CONSERVATION BONDS.

    ``(a) Qualified Energy Conservation Bond.--For purposes of this 
subchapter, the term `qualified energy conservation bond' means any 
bond issued as part of an issue if--
            ``(1) 100 percent of the available project proceeds of such 
        issue are to be used for one or more qualified conservation 
        purposes,
            ``(2) the bond is issued by a State or local government, 
        and
            ``(3) the issuer designates such bond for purposes of this 
        section.
    ``(b) Reduced Credit Amount.--The annual credit determined under 
section 54A(b) with respect to any qualified energy conservation bond 
shall be 70 percent of the amount so determined without regard to this 
subsection.
    ``(c) Limitation on Amount of Bonds Designated.--The maximum 
aggregate face amount of bonds which may be designated under subsection 
(a) by any issuer shall not exceed the limitation amount allocated to 
such issuer under subsection (e).
    ``(d) National Limitation on Amount of Bonds Designated.--There is 
a national qualified energy conservation bond limitation of 
$2,625,000,000.
    ``(e) Allocations.--
            ``(1) In general.--The limitation applicable under 
        subsection (d) shall be allocated by the Secretary among the 
        States in proportion to the population of the States.
            ``(2) Allocations to largest local governments.--
                    ``(A) In general.--In the case of any State in 
                which there is a large local government, each such 
                local government shall be allocated a portion of such 
                State's allocation which bears the same ratio to the 
                State's allocation (determined without regard to this 
                subparagraph) as the population of such large local 
                government bears to the population of such State.
                    ``(B) Allocation of unused limitation to state.--
                The amount allocated under this subsection to a large 
                local government may be reallocated by such local 
                government to the State in which such local government 
                is located.
                    ``(C) Large local government.--For purposes of this 
                section, the term `large local government' means any 
                municipality or county if such municipality or county 
                has a population of 100,000 or more.
            ``(3) Allocation to issuers; restriction on private 
        activity bonds.--Any allocation under this subsection to a 
        State or large local government shall be allocated by such 
        State or large local government to issuers within the State in 
        a manner that results in not less than 70 percent of the 
        allocation to such State or large local government being used 
        to designate bonds which are not private activity bonds.
    ``(f) Qualified Conservation Purpose.--For purposes of this 
section--
            ``(1) In general.--The term `qualified conservation 
        purpose' means any of the following:
                    ``(A) Capital expenditures incurred for purposes 
                of--
                            ``(i) reducing energy consumption in 
                        publicly-owned buildings by at least 20 
                        percent,
                            ``(ii) implementing green community 
                        programs,
                            ``(iii) rural development involving the 
                        production of electricity from renewable energy 
                        resources, or
                            ``(iv) any qualified facility (as 
                        determined under section 45(d) without regard 
                        to paragraphs (8) and (10) thereof and without 
                        regard to any placed in service date).
                    ``(B) Expenditures with respect to research 
                facilities, and research grants, to support research 
                in--
                            ``(i) development of cellulosic ethanol or 
                        other nonfossil fuels,
                            ``(ii) technologies for the capture and 
                        sequestration of carbon dioxide produced 
                        through the use of fossil fuels,
                            ``(iii) increasing the efficiency of 
                        existing technologies for producing nonfossil 
                        fuels,
                            ``(iv) automobile battery technologies and 
                        other technologies to reduce fossil fuel 
                        consumption in transportation, or
                            ``(v) technologies to reduce energy use in 
                        buildings.
                    ``(C) Mass commuting facilities and related 
                facilities that reduce the consumption of energy, 
                including expenditures to reduce pollution from 
                vehicles used for mass commuting.
                    ``(D) Demonstration projects designed to promote 
                the commercialization of--
                            ``(i) green building technology,
                            ``(ii) conversion of agricultural waste for 
                        use in the production of fuel or otherwise,
                            ``(iii) advanced battery manufacturing 
                        technologies,
                            ``(iv) technologies to reduce peak use of 
                        electricity, or
                            ``(v) technologies for the capture and 
                        sequestration of carbon dioxide emitted from 
                        combusting fossil fuels in order to produce 
                        electricity.
                    ``(E) Public education campaigns to promote energy 
                efficiency.
            ``(2) Special rules for private activity bonds.--For 
        purposes of this section, in the case of any private activity 
        bond, the term `qualified conservation purposes' shall not 
        include any expenditure which is not a capital expenditure.
    ``(g) Population.--
            ``(1) In general.--The population of any State or local 
        government shall be determined for purposes of this section as 
        provided in section 146(j) for the calendar year which includes 
        the date of the enactment of this section.
            ``(2) Special rule for counties.--In determining the 
        population of any county for purposes of this section, any 
        population of such county which is taken into account in 
        determining the population of any municipality which is a large 
        local government shall not be taken into account in determining 
        the population of such county.
    ``(h) Application to Indian Tribal Governments.--An Indian tribal 
government shall be treated for purposes of this section in the same 
manner as a large local government, except that--
            ``(1) an Indian tribal government shall be treated for 
        purposes of subsection (e) as located within a State to the 
        extent of so much of the population of such government as 
        resides within such State, and
            ``(2) any bond issued by an Indian tribal government shall 
        be treated as a qualified energy conservation bond only if 
        issued as part of an issue the available project proceeds of 
        which are used for purposes for which such Indian tribal 
        government could issue bonds to which section 103(a) 
        applies.''.
    (b) Conforming Amendments.--
            (1) Paragraph (1) of section 54A(d), as amended by section 
        806, is amended by striking ``or'' at the end of subparagraph 
        (A), by adding ``or'' at the end of subparagraph (B), and by 
        inserting after subparagraph (B) the following new 
        subparagraph:
                    ``(C) a qualified energy conservation bond,''.
            (2) Subparagraph (C) of section 54A(d)(2), as amended by 
        section 806, is amended by striking ``and'' at the end of 
        clause (i), by striking the period at the end of clause (ii) 
        and inserting ``and'', and by adding at the end the following 
        new clause:
                            ``(iii) in the case of a qualified energy 
                        conservation bond, a purpose specified in 
                        section 54D(a)(1).''.
            (3) The table of sections for subpart I of part IV of 
        subchapter A of chapter 1, as amended by section 806, is 
        amended by adding at the end the following new item:

``Sec. 54D. Qualified energy conservation bonds.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to obligations issued after the date of the enactment of this 
Act.

SEC. 842. CREDIT FOR NONBUSINESS ENERGY PROPERTY.

    (a) Extension of Credit.--Section 25C(g) is amended by striking 
``December 31, 2007'' and inserting ``December 31, 2008''.
    (b) Qualified Biomass Fuel Property.--
            (1) In general.--Section 25C(d)(3) is amended--
                    (A) by striking ``and'' at the end of subparagraph 
                (D),
                    (B) by striking the period at the end of 
                subparagraph (E) and inserting ``, and'', and
                    (C) by adding at the end the following new 
                subparagraph:
                    ``(F) a stove which uses the burning of biomass 
                fuel to heat a dwelling unit located in the United 
                States and used as a residence by the taxpayer, or to 
                heat water for use in such a dwelling unit, and which 
                has a thermal efficiency rating of at least 75 
                percent.''.
            (2) Biomass fuel.--Section 25C(d) is amended by adding at 
        the end the following new paragraph:
            ``(6) Biomass fuel.--The term `biomass fuel' means any 
        plant-derived fuel available on a renewable or recurring basis, 
        including agricultural crops and trees, wood and wood waste and 
        residues (including wood pellets), plants (including aquatic 
        plants), grasses, residues, and fibers.''.
    (c) Coordination With Credit for Qualified Geothermal Heat Pump 
Property Expenditures.--
            (1) In general.--Paragraph (3) of section 25C(d), as 
        amended by subsection (b), is amended by striking subparagraph 
        (C) and by redesignating subparagraphs (D), (E), and (F) as 
        subparagraphs (C), (D), and (E), respectively.
            (2) Conforming amendment.--Subparagraph (C) of section 
        25C(d)(2) is amended to read as follows:
                    ``(C) Requirements and standards for air 
                conditioners and heat pumps.--The standards and 
                requirements prescribed by the Secretary under 
                subparagraph (B) with respect to the energy efficiency 
                ratio (EER) for central air conditioners and electric 
                heat pumps--
                            ``(i) shall require measurements to be 
                        based on published data which is tested by 
                        manufacturers at 95 degrees Fahrenheit, and
                            ``(ii) may be based on the certified data 
                        of the Air Conditioning and Refrigeration 
                        Institute that are prepared in partnership with 
                        the Consortium for Energy Efficiency.''.
    (d) Effective Date.--The amendments made this section shall apply 
to expenditures made after December 31, 2007.

SEC. 843. ENERGY EFFICIENT COMMERCIAL BUILDINGS DEDUCTION.

    Subsection (h) of section 179D is amended by striking ``December 
31, 2008'' and inserting ``December 31, 2013''.

SEC. 844. MODIFICATIONS OF ENERGY EFFICIENT APPLIANCE CREDIT FOR 
              APPLIANCES PRODUCED AFTER 2007.

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

SEC. 845. ACCELERATED RECOVERY PERIOD FOR DEPRECIATION OF SMART METERS 
              AND SMART GRID SYSTEMS.

    (a) In General.--Section 168(e)(3)(D) is amended by striking 
``and'' at the end of clause (i), by striking the period at the end of 
clause (ii) and inserting a comma, and by inserting after clause (ii) 
the following new clauses:
                            ``(iii) any qualified smart electric meter, 
                        and
                            ``(iv) any qualified smart electric grid 
                        system.''.
    (b) Definitions.--Section 168(i) is amended by inserting at the end 
the following new paragraph:
            ``(18) Qualified smart electric meters.--
                    ``(A) In general.--The term `qualified smart 
                electric meter' means any smart electric meter which is 
                placed in service by a taxpayer who is a supplier of 
                electric energy or a provider of electric energy 
                services.
                    ``(B) Smart electric meter.--For purposes of 
                subparagraph (A), the term `smart electric meter' means 
                any time-based meter and related communication 
                equipment which is capable of being used by the 
                taxpayer as part of a system that--
                            ``(i) measures and records electricity 
                        usage data on a time-differentiated basis in at 
                        least 24 separate time segments per day,
                            ``(ii) provides for the exchange of 
                        information between supplier or provider and 
                        the customer's electric meter in support of 
                        time-based rates or other forms of demand 
                        response,
                            ``(iii) provides data to such supplier or 
                        provider so that the supplier or provider can 
                        provide energy usage information to customers 
                        electronically, and
                            ``(iv) provides net metering.
            ``(19) Qualified smart electric grid systems.--
                    ``(A) In general.--The term `qualified smart 
                electric grid system' means any smart grid property 
                used as part of a system for electric distribution grid 
                communications, monitoring, and management placed in 
                service by a taxpayer who is a supplier of electric 
                energy or a provider of electric energy services.
                    ``(B) Smart grid property.--For the purposes of 
                subparagraph (A), the term `smart grid property' means 
                electronics and related equipment that is capable of--
                            ``(i) sensing, collecting, and monitoring 
                        data of or from all portions of a utility's 
                        electric distribution grid,
                            ``(ii) providing real-time, two-way 
                        communications to monitor or manage such grid, 
                        and
                            ``(iii) providing real time analysis of and 
                        event prediction based upon collected data that 
                        can be used to improve electric distribution 
                        system reliability, quality, and 
                        performance.''.
    (c) Continued Application of 150 Percent Declining Balance 
Method.--Paragraph (2) of section 168(b) is amended by striking ``or'' 
at the end of subparagraph (B), by redesignating subparagraph (C) as 
subparagraph (D), and by inserting after subparagraph (B) the following 
new subparagraph:
                    ``(C) any property (other than property described 
                in paragraph (3)) which is a qualified smart electric 
                meter or qualified smart electric grid system, or''.
    (d) Effective Date.--The amendments made by this section shall 
apply to property placed in service after the date of the enactment of 
this Act.

SEC. 846. QUALIFIED GREEN BUILDING AND SUSTAINABLE DESIGN PROJECTS.

    (a) In General.--Paragraph (8) of section 142(l) is amended by 
striking ``September 30, 2009'' and inserting ``September 30, 2012''.
    (b) Treatment of Current Refunding Bonds.--Paragraph (9) of section 
142(l) is amended by striking ``October 1, 2009'' and inserting 
``October 1, 2012''.
    (c) Accountability.--The second sentence of section 701(d) of the 
American Jobs Creation Act of 2004 is amended by striking ``issuance,'' 
and inserting ``issuance of the last issue with respect to such 
project,''.

                     Subtitle D--Revenue Provisions

SEC. 851. LIMITATION OF DEDUCTION FOR INCOME ATTRIBUTABLE TO DOMESTIC 
              PRODUCTION OF OIL, GAS, OR PRIMARY PRODUCTS THEREOF.

    (a) Denial of Deduction for Specified Oil Companies for Income 
Attributable to Domestic Production of Oil, Gas, or Primary Products 
Thereof.--Subparagraph (B) of section 199(c)(4) (relating to 
exceptions) is amended by striking ``or'' at the end of clause (ii), by 
striking the period at the end of clause (iii) and inserting ``, or'', 
and by inserting after clause (iii) the following new clause:
                            ``(iv) in the case of any specified oil 
                        company (as defined in subsection (d)(9)), the 
                        production, refining, processing, 
                        transportation, or distribution of oil, gas, or 
                        any primary product thereof.''.
    (b) Limitation on Oil Related Qualified Production Activities 
Income for Taxpayers Other Than Specified Oil Companies.--
            (1) In general.--Section 199(d) is amended by redesignating 
        paragraph (9) as paragraph (10) and by inserting after 
        paragraph (8) the following new paragraph:
            ``(9) Special rule for taxpayers with oil related qualified 
        production activities income.--
                    ``(A) In general.--If a taxpayer (other than a 
                specified oil company) has oil related qualified 
                production activities income for any taxable year 
                beginning after 2009, the amount otherwise allowable as 
                a deduction under subsection (a) shall be reduced by 3 
                percent of the least of--
                            ``(i) the oil related qualified production 
                        activities income of the taxpayer for the 
                        taxable year,
                            ``(ii) the qualified production activities 
                        income of the taxpayer for the taxable year, or
                            ``(iii) taxable income (determined without 
                        regard to this section).
                    ``(B) Oil related qualified production activities 
                income.--For purposes of this section, the term `oil 
                related qualified production activities income' means 
                for any taxable year the qualified production 
                activities income which is attributable to the 
                production, refining, processing, transportation, or 
                distribution of oil, gas, or any primary product 
                thereof during such taxable year.
                    ``(C) Specified oil company.--For purposes of this 
                section, the term `specified oil company' means--
                            ``(i) any major integrated oil company (as 
                        defined in section 167(h)(5)(B)), and
                            ``(ii) any entity in which a foreign 
                        government holds (directly or indirectly)--
                                    ``(I) any interest which (by value 
                                or voting interest) is 50 percent or 
                                more of the total of such interests in 
                                such entity, or
                                    ``(II) any other interest which 
                                provides the foreign government with 
                                effective control of such entity.
                    ``(D) Primary product.--For purposes of this 
                section, the term `primary product' has the same 
                meaning as when used in section 927(a)(2)(C), as in 
                effect before its repeal.''.
            (2) Conforming amendment.--Section 199(d)(2) (relating to 
        application to individuals) is amended by striking ``subsection 
        (a)(1)(B)'' and inserting ``subsections (a)(1)(B) and 
        (d)(9)(A)(iii)''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2008.

SEC. 852. CLARIFICATION OF DETERMINATION OF FOREIGN OIL AND GAS 
              EXTRACTION INCOME.

    (a) In General.--Paragraph (1) of section 907(c) is amended by 
redesignating subparagraph (B) as subparagraph (C), by striking ``or'' 
at the end of subparagraph (A), and by inserting after subparagraph (A) 
the following new subparagraph:
                    ``(B) so much of any transportation of such 
                minerals as occurs before the fair market value event, 
                or''.
    (b) Fair Market Value Event.--Subsection (c) of section 907 is 
amended by adding at the end the following new paragraph:
            ``(6) Fair market value event.--For purposes of this 
        section, the term `fair market value event' means, with respect 
        to any mineral, the first point in time at which such mineral--
                    ``(A) has a fair market value which can be 
                determined on the basis of a transfer, which is an 
                arm's length transaction, of such mineral from the 
                taxpayer to a person who is not related (within the 
                meaning of section 482) to such taxpayer, or
                    ``(B) is at a location at which the fair market 
                value is readily ascertainable by reason of 
                transactions among unrelated third parties with respect 
                to the same mineral (taking into account source, 
                location, quality, and chemical composition).''.
    (c) Special Rule for Certain Petroleum Taxes.--Subsection (c) of 
section 907, as amended by subsection (b), is amended to by adding at 
the end the following new paragraph:
            ``(7) Oil and gas taxes.--In the case of any tax imposed by 
        a foreign country which is limited in its application to 
        taxpayers engaged in oil or gas activities--
                    ``(A) the term `oil and gas extraction taxes' shall 
                include such tax,
                    ``(B) the term `foreign oil and gas extraction 
                income' shall include any taxable income which is taken 
                into account in determining such tax (or is directly 
                attributable to the activity to which such tax 
                relates), and
                    ``(C) the term `foreign oil related income' shall 
                not include any taxable income which is treated as 
                foreign oil and gas extraction income under 
                subparagraph (B).''.
    (d) Conforming Amendments.--
            (1) Subparagraph (C) of section 907(c)(1), as redesignated 
        by this section, is amended by inserting ``or used by the 
        taxpayer in the activity described in subparagraph (B)'' before 
        the period at the end.
            (2) Subparagraph (B) of section 907(c)(2) is amended to 
        read as follows:
                    ``(B) so much of the transportation of such 
                minerals or primary products as is not taken into 
                account under paragraph (1)(B),''.
    (e) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 853. TIME FOR PAYMENT OF CORPORATE ESTIMATED TAXES.

    In the case of a corporation--
            (1) to which paragraph (1) of section 401 of the Tax 
        Increase Prevention and Reconciliation Act of 2005 applies, and
            (2) which had any significant income for the preceding 
        taxable year referred to in such paragraph from extraction, 
        production, processing, refining, transportation, distribution, 
        or retail sale, of any fuel or electricity,
the percentage under subparagraph (C) of such paragraph (as in effect 
on the date of the enactment of this Act) is increased by 40 percentage 
points.

            Passed the House of Representatives September 16, 2008.

            Attest:

                                                                 Clerk.
110th CONGRESS

  2d Session

                               H. R. 6899

_______________________________________________________________________

                                 AN ACT

  To advance the national security interests of the United States by 
reducing its dependency on oil through renewable and clean, alternative 
    fuel technologies while building a bridge to the future through 
expanded access to Federal oil and natural gas resources, revising the 
relationship between the oil and gas industry and the consumers who own 
   those resources and deserve a fair return from the development of 
publicly owned oil and gas, ending tax subsidies for large oil and gas 
   companies, and facilitating energy efficiencies in the building, 
      housing, and transportation sectors, and for other purposes.