    [Congressional Bills 110th Congress]
    [From the U.S. Government Publishing Office]
    [S. 2191 Reported in Senate (RS)]

                                                           Calendar No. 740
    110th CONGRESS
      2d Session
                                    S. 2191

                              [Report No. 110-337]

     To direct the Administrator of the Environmental Protection Agency to
    establish a program to decrease emissions of greenhouse gases, and for
                                other purposes.

    _______________________________________________________________________

                       IN THE SENATE OF THE UNITED STATES

                                October 18, 2007

     Mr. Lieberman (for himself, Mr. Warner, Mr. Harkin, Mr. Coleman, Mrs.
    Dole, Ms. Collins, Mr. Cardin, Ms. Klobuchar, Mr. Casey, Mr. Nelson of
      Florida, Mr. Wyden, and Mr. Schumer) introduced the following bill;
     which was read twice and referred to the Committee on Environment and
                                  Public Works

                                  May 20, 2008

                   Reported by Mrs. Boxer, with an amendment
     [Strike out all after the enacting clause and insert the part printed
                                   in italic]

    _______________________________________________________________________

                                     A BILL

     To direct the Administrator of the Environmental Protection Agency to
    establish a program to decrease emissions of greenhouse gases, and for
                                other purposes.

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

    <DELETED>SECTION 1. SHORT TITLE; TABLE OF CONTENTS.</DELETED>

    <DELETED>    (a) Short Title.--This Act may be cited as the ``America's
    Climate Security Act of 2007''.</DELETED>
    <DELETED>    (b) Table of Contents.--The table of contents of this Act
    is as follows:</DELETED>

    <DELETED>Sec. 1. Short title; table of contents.
    <DELETED>Sec. 2. Findings.
    <DELETED>Sec. 3. Purposes.
    <DELETED>Sec. 4. Definitions.
               <DELETED>TITLE I--CAPPING GREENHOUSE GAS EMISSIONS

                    <DELETED>Subtitle A--Tracking Emissions

    <DELETED>Sec. 1101. Purpose.
    <DELETED>Sec. 1102. Definitions.
    <DELETED>Sec. 1103. Reporting requirements.
    <DELETED>Sec. 1104. Data quality and verification.
    <DELETED>Sec. 1105. Federal greenhouse gas registry.
    <DELETED>Sec. 1106. Enforcement.
                    <DELETED>Subtitle B--Reducing Emissions

    <DELETED>Sec. 1201. Emission allowance account.
    <DELETED>Sec. 1202. Compliance obligation.
    <DELETED>Sec. 1203. Penalty for noncompliance.
          <DELETED>TITLE II--MANAGING AND CONTAINING COSTS EFFICIENTLY

                          <DELETED>Subtitle A--Trading

    <DELETED>Sec. 2101. Sale, exchange, and retirement of emission
                                allowances.
    <DELETED>Sec. 2102. No restriction on transactions.
    <DELETED>Sec. 2103. Allowance transfer system.
    <DELETED>Sec. 2104. Allowance tracking system.
                          <DELETED>Subtitle B--Banking

    <DELETED>Sec. 2201. Indication of calendar year.
    <DELETED>Sec. 2202. Effect of time.
                         <DELETED>Subtitle C--Borrowing

    <DELETED>Sec. 2301. Regulations.
    <DELETED>Sec. 2302. Term.
    <DELETED>Sec. 2303. Repayment with interest.
                          <DELETED>Subtitle D--Offsets

    <DELETED>Sec. 2401. Outreach initiative on revenue enhancement for
                                agricultural producers.
    <DELETED>Sec. 2402. Establishment of domestic offset program.
    <DELETED>Sec. 2403. Eligible agricultural and forestry offset project
                                types.
    <DELETED>Sec. 2404. Project initiation and approval.
    <DELETED>Sec. 2405. Offset verification and issuance of allowances for
                                agricultural and forestry projects.
    <DELETED>Sec. 2406. Tracking of reversals for sequestration projects.
    <DELETED>Sec. 2407. Examinations.
    <DELETED>Sec. 2408. Timing and the provision of offset allowances.
    <DELETED>Sec. 2409. Offset registry.
    <DELETED>Sec. 2410. Environmental considerations.
    <DELETED>Sec. 2411. Program review.
                   <DELETED>Subtitle E--International Credits

    <DELETED>Sec. 2501. Use of international allowances or credits.
    <DELETED>Sec. 2502. Regulations.
    <DELETED>Sec. 2503. Facility certification.
              <DELETED>Subtitle F--Carbon Market Efficiency Board

    <DELETED>Sec. 2601. Purposes.
    <DELETED>Sec. 2602. Establishment of Carbon Market Efficiency Board.
    <DELETED>Sec. 2603. Duties.
    <DELETED>Sec. 2604. Powers.
    <DELETED>Sec. 2605. Estimate of costs to economy of limiting greenhouse
                                gas emissions.
           <DELETED>TITLE III--ALLOCATING AND DISTRIBUTING ALLOWANCES

                      <DELETED>Subtitle A--Early Auctions

    <DELETED>Sec. 3101. Allocation for early auctions.
                      <DELETED>Subtitle B--Annual Auctions

    <DELETED>Sec. 3201. Allocation for annual auctions.
                       <DELETED>Subtitle C--Early Action

    <DELETED>Sec. 3301. Allocation.
    <DELETED>Sec. 3302. Distribution.
                          <DELETED>Subtitle D--States

    <DELETED>Sec. 3401. Allocation for energy savings.
    <DELETED>Sec. 3402. Allocation for States with programs that exceed
                                Federal emission reduction targets.
    <DELETED>Sec. 3403. General allocation.
                   <DELETED>Subtitle E--Electricity Consumers

    <DELETED>Sec. 3501. Allocation.
    <DELETED>Sec. 3502. Distribution.
    <DELETED>Sec. 3503. Use.
    <DELETED>Sec. 3504. Reporting.
    <DELETED>Subtitle F--Bonus Allowances for Carbon Capture and Geological
                                 Sequestration

    <DELETED>Sec. 3601. Allocation.
    <DELETED>Sec. 3602. Qualifying projects.
    <DELETED>Sec. 3603. Distribution.
    <DELETED>Sec. 3604. 10-Year limit.
    <DELETED>Sec. 3605. Exhaustion of bonus allowance account.
             <DELETED>Subtitle G--Domestic Agriculture and Forestry

    <DELETED>Sec. 3701. Allocation.
    <DELETED>Sec. 3702. Agricultural and forestry greenhouse gas management
                                research.
    <DELETED>Sec. 3703. Distribution.
              <DELETED>Subtitle H--International Forest Protection

    <DELETED>Sec. 3801. Findings.
    <DELETED>Sec. 3802. Definition of forest carbon activities.
    <DELETED>Sec. 3803. Allocation.
    <DELETED>Sec. 3804. Definition and eligibility requirements.
    <DELETED>Sec. 3805. International forest carbon activities.
    <DELETED>Sec. 3806. Reviews and discount.
                    <DELETED>Subtitle I--Covered Facilities

    <DELETED>Sec. 3901. Allocation.
    <DELETED>Sec. 3902. Distribution system.
    <DELETED>Sec. 3903. Distributing emission allowances within the
                                electric power sector.
    <DELETED>Sec. 3904. Distributing emission allowances within the
                                industrial sector.
            <DELETED>TITLE IV--AUCTIONS AND USES OF AUCTION PROCEEDS

                           <DELETED>Subtitle A--Funds

    <DELETED>Sec. 4101. Establishment.
    <DELETED>Sec. 4102. Amounts in Funds.
    <DELETED>Sec. 4103. Transfers to Funds.
             <DELETED>Subtitle B--Climate Change Credit Corporation

    <DELETED>Sec. 4201. Establishment.
    <DELETED>Sec. 4202. Applicable laws.
    <DELETED>Sec. 4203. Board of directors.
                         <DELETED>Subtitle C--Auctions

    <DELETED>Sec. 4301. Early auctions.
    <DELETED>Sec. 4302. Annual auctions.
               <DELETED>Subtitle D--Energy Technology Deployment

    <DELETED>Sec. 4401. In general.
    <DELETED>Sec. 4402. Zero- or low-carbon energy technologies deployment.
    <DELETED>Sec. 4403. Advanced coal and sequestration technologies
                                program.
    <DELETED>Sec. 4404. Fuel from cellulosic biomass.
    <DELETED>Sec. 4405. Advanced technology vehicles manufacturing
                                incentive program.
                     <DELETED>Subtitle E--Energy Consumers

    <DELETED>Sec. 4501. Proportions of funding availability.
    <DELETED>Sec. 4502. Rural energy assistance program.
          <DELETED>Subtitle F--Climate Change Worker Training Program

    <DELETED>Sec. 4601. Funding.
    <DELETED>Sec. 4602. Purposes.
    <DELETED>Sec. 4603. Establishment.
    <DELETED>Sec. 4604. Grants to States.
    <DELETED>Sec. 4605. Types of assistance.
    <DELETED>Subtitle G--Adaptation Program for Natural Resources in United
                             States and Territories

    <DELETED>Sec. 4701. Definitions.
    <DELETED>Sec. 4702. Adaptation fund.
       <DELETED>Subtitle H--Climate Change and National Security Program

    <DELETED>Sec. 4801. Interagency Climate Change and National Security
                                Council.
    <DELETED>Sec. 4802. Funding.
                          <DELETED>Subtitle I--Audits

    <DELETED>Sec. 4901. Review and audit by Comptroller General of the
                                United States.
                      <DELETED>TITLE V--ENERGY EFFICIENCY

                   <DELETED>Subtitle A--Appliance Efficiency

    <DELETED>Sec. 5101. Residential boilers.
    <DELETED>Sec. 5102. Regional variations in heating or cooling
                                standards.
                    <DELETED>Subtitle B--Building Efficiency

    <DELETED>Sec. 5201. Updating State building energy efficiency codes.
    <DELETED>Sec. 5202. Conforming amendment.
      <DELETED>TITLE VI--GLOBAL EFFORT TO REDUCE GREENHOUSE GAS EMISSIONS

    <DELETED>Sec. 6001. Definitions.
    <DELETED>Sec. 6002. Purposes.
    <DELETED>Sec. 6003. International negotiations.
    <DELETED>Sec. 6004. Interagency review.
    <DELETED>Sec. 6005. Presidential determinations.
    <DELETED>Sec. 6006. International reserve allowance program.
    <DELETED>Sec. 6007. Adjustment of international reserve allowance
                                requirements.
                          <DELETED>TITLE VII--REVIEWS

    <DELETED>Sec. 7001. National Academy of Sciences Review.
    <DELETED>Sec. 7002. Transportation sector review.
    <DELETED>Sec. 7003. Adaptation review.
     <DELETED>TITLE VIII--FRAMEWORK FOR GEOLOGICAL SEQUESTRATION OF CARBON
                                    DIOXIDE

    <DELETED>Sec. 8001. National drinking water regulations.
    <DELETED>Sec. 8002. Assessment of geological storage capacity for
                                carbon dioxide.
    <DELETED>Sec. 8003. Study of the feasibility relating to construction
                                of pipelines and geological carbon dioxide
                                sequestration activities.
    <DELETED>Sec. 8004. Liabilities for closed geological storage sites.
                        <DELETED>TITLE IX--MISCELLANEOUS

    <DELETED>Sec. 9001. Paramount interest waiver.
    <DELETED>Sec. 9002. Corporate environmental disclosure of climate
                                change risks.
    <DELETED>Sec. 9003. Administrative procedure and judicial review.
    <DELETED>Sec. 9004. Retention of State authority.
    <DELETED>Sec. 9005. Tribal authority.
    <DELETED>Sec. 9006. Authorization of appropriations.

    <DELETED>SEC. 2. FINDINGS.</DELETED>

    <DELETED>    Congress finds that--</DELETED>
            <DELETED>    (1) unchecked global warming poses a significant
            threat to--</DELETED>
                    <DELETED>    (A) the national security and economy of
                    the United States;</DELETED>
                    <DELETED>    (B) public health and welfare in the
                    United States;</DELETED>
                    <DELETED>    (C) the well-being of other countries;
                    and</DELETED>
                    <DELETED>    (D) the global environment;</DELETED>
            <DELETED>    (2) under the United Nations Framework Convention
            on Climate Change, done at New York on May 9, 1992, the United
            States is committed to stabilizing greenhouse gas
            concentrations in the atmosphere at a level that will prevent
            dangerous anthropogenic interference with the climate
            system;</DELETED>
            <DELETED>    (3) according to the Fourth Assessment Report of
            the Intergovernmental Panel on Climate Change, stabilizing
            greenhouse gas concentrations in the atmosphere at a level that
            will prevent dangerous interference with the climate system
            will require a global effort to reduce anthropogenic greenhouse
            gas emissions worldwide by 50 to 85 percent below 2000 levels
            by 2050;</DELETED>
            <DELETED>    (4) prompt, decisive action is critical, since
            global warming pollutants can persist in the atmosphere for
            more than a century;</DELETED>
            <DELETED>    (5) the ingenuity of the people of the United
            States will allow the United States to become a leader in
            curbing global warming;</DELETED>
            <DELETED>    (6) it is possible and desirable to cap greenhouse
            gas emissions, from sources that together account for the
            majority of those emissions in the United States, at the
            current level in 2012, and to lower the cap each year between
            2012 and 2050, on the condition that the system includes--
            </DELETED>
                    <DELETED>    (A) cost containment measures;</DELETED>
                    <DELETED>    (B) periodic review of
                    requirements;</DELETED>
                    <DELETED>    (C) an aggressive program for deploying
                    advanced energy technology;</DELETED>
                    <DELETED>    (D) programs to assist low- and middle-
                    income energy consumers; and</DELETED>
                    <DELETED>    (E) programs to mitigate the impacts of
                    any unavoidable global climate change;</DELETED>
            <DELETED>    (7) Congress may need to update the emissions caps
            in order to account for continuing scientific data and steps
            taken, or not taken, by foreign countries;</DELETED>
            <DELETED>    (8) accurate emission data and timely compliance
            with the requirements of the greenhouse gas emission reduction
            and trading program established under this Act are needed to
            ensure that reductions are achieved and to provide equity,
            efficiency, and openness in the market for allowances subject
            to the program; and</DELETED>
            <DELETED>    (9) additional policies external to a cap-and-
            trade program may be required, including with respect to--
            </DELETED>
                    <DELETED>    (A) the transportation sector, where
                    reducing greenhouse gas emissions requires changes in
                    the vehicle, in the fuels, and in consumer behavior;
                    and</DELETED>
                    <DELETED>    (B) the built environment, where reducing
                    direct and indirect greenhouse gas emissions requires
                    changes in buildings, appliances, lighting, heating,
                    cooling, and consumer behavior.</DELETED>

    <DELETED>SEC. 3. PURPOSES.</DELETED>

    <DELETED>    The purposes of this Act are--</DELETED>
            <DELETED>    (1) to establish the core of a Federal program
            that will reduce United States greenhouse gas emissions
            substantially enough between 2007 and 2050 to avert the
            catastrophic impacts of global climate change; and</DELETED>
            <DELETED>    (2) to accomplish that purpose while preserving
            robust growth in the United States economy and avoiding the
            imposition of hardship on United States citizens.</DELETED>

    <DELETED>SEC. 4. DEFINITIONS.</DELETED>

    <DELETED>    In this Act:</DELETED>
            <DELETED>    (1) Additional and additionality.--The terms
            ``additional'' and ``additionality'' mean the extent to which
            reductions in greenhouse gas emissions or increases in
            sequestration are incremental to business-as-usual, measured as
            the difference between--</DELETED>
                    <DELETED>    (A) baseline greenhouse gas fluxes of an
                    offset project; and</DELETED>
                    <DELETED>    (B) greenhouse gas fluxes of the offset
                    project.</DELETED>
            <DELETED>    (2) Administrator.--The term ``Administrator''
            means the Administrator of the Environmental Protection
            Agency.</DELETED>
            <DELETED>    (3) Baseline.--The term ``baseline'' means the
            greenhouse gas flux or carbon stock that would have occurred in
            the absence of an offset allowance.</DELETED>
            <DELETED>    (4) Biological sequestration; biologically
            sequestered.--The terms ``biological sequestration'' and
            ``biologically sequestered'' mean--</DELETED>
                    <DELETED>    (A) the removal of greenhouse gases from
                    the atmosphere by terrestrial biological means, such as
                    by growing plants; and</DELETED>
                    <DELETED>    (B) the storage of those greenhouse gases
                    without reversal in the plants or related
                    soils.</DELETED>
            <DELETED>    (5) Carbon dioxide equivalent.--The term ``carbon
            dioxide equivalent'' means, for each greenhouse gas, the
            quantity of the greenhouse gas that the Administrator
            determines makes the same contribution to global warming as 1
            metric ton of carbon dioxide.</DELETED>
            <DELETED>    (6) Corporation.--The term ``Corporation'' means
            the Climate Change Credit Corporation established by section
            4201(a).</DELETED>
            <DELETED>    (7) Covered facility.--The term ``covered
            facility'' means--</DELETED>
                    <DELETED>    (A) any facility within the electric power
                    sector that contains fossil fuel-fired electricity
                    generating units that together emit more than 10,000
                    carbon dioxide equivalents of greenhouse gas in any
                    year;</DELETED>
                    <DELETED>    (B) any facility within the industrial
                    sector that emits more than 10,000 carbon dioxide
                    equivalents of greenhouse gas in any year;</DELETED>
                    <DELETED>    (C) any facility that in any year
                    produces, or any entity that in any year imports,
                    petroleum- or coal-based transportation fuel, the use
                    of which will emit more than 10,000 carbon dioxide
                    equivalents of greenhouse gas, assuming no capture and
                    permanent sequestration of that gas; or</DELETED>
                    <DELETED>    (D) any facility that in any year
                    produces, or any entity that in any year imports,
                    nonfuel chemicals that will emit more than 10,000
                    carbon dioxide equivalents of greenhouse gas, assuming
                    no capture and destruction or permanent sequestration
                    of that gas.</DELETED>
            <DELETED>    (8) Destruction.--The term ``destruction'' means
            the conversion of a greenhouse gas by thermal, chemical, or
            other means--</DELETED>
                    <DELETED>    (A) to another gas with a low- or zero-
                    global warming potential; and</DELETED>
                    <DELETED>    (B) for which credit given reflects the
                    extent of reduction in global warming potential
                    actually achieved.</DELETED>
            <DELETED>    (9) Electric power sector.--The term ``electric
            power sector'' means the ``Electric Power Industry'', as that
            term is used in Table ES-7 of the Environmental Protection
            Agency document entitled ``Inventory of U.S. Greenhouse Gas
            Emissions and Sinks: 1990-2005''.</DELETED>
            <DELETED>    (10) Emission allowance.--The term ``emission
            allowance'' means an authorization to emit 1 carbon dioxide
            equivalent of greenhouse gas.</DELETED>
            <DELETED>    (11) Emission allowance account.--The term
            ``Emission Allowance Account'' means the aggregate of emission
            allowances that the Administrator establishes for a calendar
            year.</DELETED>
            <DELETED>    (12) Facility.--The term ``facility'' means--
            </DELETED>
                    <DELETED>    (A) a building, structure, or installation
                    located on 1 or more contiguous or adjacent properties
                    of an entity in the United States; and</DELETED>
                    <DELETED>    (B) at the option of the Administrator,
                    any activity or operation that has a technical
                    connection with the activities carried out at a
                    facility, such as use of transportation fleets,
                    pipelines, transmission lines, and distribution lines,
                    but that is not conducted or located on the property of
                    the facility.</DELETED>
            <DELETED>    (13) Fair market value.--The term ``fair market
            value'' means the average price, in a particular calendar year,
            of an emission allowance auctioned by the
            Corporation.</DELETED>
            <DELETED>    (14) Geological sequestration; geologically
            sequestered.--The terms ``geological sequestration'' and
            ``geologically sequestered'' mean the long-term isolation of
            greenhouse gases, without reversal, in geological formations,
            in accordance with section 1421(d) of the Safe Drinking Water
            Act (42 U.S.C. 300h(d)).</DELETED>
            <DELETED>    (15) Greenhouse gas.--The term ``greenhouse gas''
            means any of--</DELETED>
                    <DELETED>    (A) carbon dioxide;</DELETED>
                    <DELETED>    (B) methane;</DELETED>
                    <DELETED>    (C) nitrous oxide;</DELETED>
                    <DELETED>    (D) sulfur hexafluoride;</DELETED>
                    <DELETED>    (E) a hydrofluorocarbon; or</DELETED>
                    <DELETED>    (F) a perfluorocarbon.</DELETED>
            <DELETED>    (16) Industrial sector.--The term ``industrial
            sector'' means ``Industry'', as that term is used in Table ES-7
            of the Environmental Protection Agency document entitled
            ``Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-
            2005''.</DELETED>
            <DELETED>    (17) Leakage.--The term ``leakage'' means--
            </DELETED>
                    <DELETED>    (A) a potentially unaccounted increase in
                    greenhouse gas emissions by a facility or entity caused
                    by an offset project that produces an accounted
                    reduction in greenhouse gas emissions; or</DELETED>
                    <DELETED>    (B) a potentially unaccounted decrease in
                    sequestration that is caused by an offset project that
                    results in an accounted increase in
                    sequestration.</DELETED>
            <DELETED>    (18) Load-serving entity.--The term ``load-serving
            entity'' means an entity, whether public or private--</DELETED>
                    <DELETED>    (A) that has a legal, regulatory, or
                    contractual obligation to deliver electricity to retail
                    consumers; and</DELETED>
                    <DELETED>    (B) whose rates and costs are, except in
                    the case of a registered electric cooperative,
                    regulated by a State agency, regulatory commission,
                    municipality, or public utility district.</DELETED>
            <DELETED>    (19) New entrant.--The term ``new entrant'' means
            any facility that commences operation on or after January 1,
            2008.</DELETED>
            <DELETED>    (20) Offset allowance.--The term ``offset
            allowance'' means a unit of reduction in the quantity of
            emissions or an increase in sequestration equal to 1 carbon
            dioxide equivalent at a facility that is not a covered
            facility, where the reduction in emissions or increase in
            sequestration is eligible to be used as an additional means of
            compliance for the submission requirements established under
            section 1202.</DELETED>
            <DELETED>    (21) Offset project.--The term ``offset project''
            means a project, other than a project at a covered facility,
            that reduces greenhouse gas emissions or increases
            sequestration of carbon dioxide.</DELETED>
            <DELETED>    (22) Project developer.--The term ``project
            developer'' means an individual or entity implementing an
            offset project.</DELETED>
            <DELETED>    (23) Retail rate for distribution service.--
            </DELETED>
                    <DELETED>    (A) In general.--The term ``retail rate
                    for distribution service'' means the rate that a load-
                    serving entity charges for the use of the system of the
                    load-serving entity.</DELETED>
                    <DELETED>    (B) Exclusion.--The term ``retail rate for
                    distribution service'' does not include any energy
                    component of the rate.</DELETED>
            <DELETED>    (24) Retire an emission allowance.--The term
            ``retire an emission allowance'' means to disqualify an
            emission allowance for any subsequent use, regardless of
            whether the use is a sale, exchange, or submission of the
            allowance in satisfying a compliance obligation.</DELETED>
            <DELETED>    (25) Reversal.--The term ``reversal'' means an
            intentional or unintentional loss of sequestered carbon dioxide
            to the atmosphere.</DELETED>
            <DELETED>    (26) Rural electric cooperative.--The term ``rural
            electric cooperative'' means a cooperatively-owned association
            that is eligible to receive loans under section 4 of the Rural
            Electrification Act of 1936 (7 U.S.C. 904).</DELETED>
            <DELETED>    (27) Sequestered and sequestration.--The terms
            ``sequestered'' and ``sequestration'' mean the capture,
            permanent separation, isolation, or removal of greenhouse gases
            from the atmosphere.</DELETED>
            <DELETED>    (28) State regulatory authority.--The term ``State
            regulatory authority'' means any State agency that has
            ratemaking authority with respect to the retail rate for
            distribution service.</DELETED>
            <DELETED>    (29) Transportation sector.--The term
            ``transportation sector'' means ``Transportation'', as that
            term is used in Table ES-7 of the Environmental Protection
            Agency document entitled, ``Inventory of U.S. Greenhouse Gas
            Emissions and Sinks: 1990-2005''.</DELETED>

          <DELETED>TITLE I--CAPPING GREENHOUSE GAS EMISSIONS</DELETED>

               <DELETED>Subtitle A--Tracking Emissions</DELETED>

    <DELETED>SEC. 1101. PURPOSE.</DELETED>

    <DELETED>    The purpose of this subtitle is to establish a Federal
    greenhouse gas registry that--</DELETED>
            <DELETED>    (1) is complete, consistent, transparent, and
            accurate;</DELETED>
            <DELETED>    (2) will collect reliable and accurate data that
            can be used by public and private entities to design efficient
            and effective energy security initiatives and greenhouse gas
            emission reduction strategies; and</DELETED>
            <DELETED>    (3) will provide appropriate high-quality data to
            be used for implementing greenhouse gas reduction
            policies.</DELETED>

    <DELETED>SEC. 1102. DEFINITIONS.</DELETED>

    <DELETED>    In this subtitle:</DELETED>
            <DELETED>    (1) Affected facility.--</DELETED>
                    <DELETED>    (A) In general.--The term ``affected
                    facility'' means--</DELETED>
                            <DELETED>    (i) a covered facility;</DELETED>
                            <DELETED>    (ii) another facility that emits a
                            greenhouse gas, as determined by the
                            Administrator; and</DELETED>
                            <DELETED>    (iii) at the option of the
                            Administrator, a vehicle fleet with emissions
                            of more than 10,000 carbon dioxide equivalents
                            per year, assuming no double-counting of
                            emissions.</DELETED>
                    <DELETED>    (B) Exclusions.--The term ``affected
                    facility'' does not include any facility that--
                    </DELETED>
                            <DELETED>    (i) is not a covered
                            facility;</DELETED>
                            <DELETED>    (ii) is owned or operated by a
                            small business (as described in part 121 of
                            title 13, Code of Federal Regulations (or a
                            successor regulation)); and</DELETED>
                            <DELETED>    (iii) emits fewer than 10,000
                            carbon dioxide equivalents in any
                            year.</DELETED>
            <DELETED>    (2) Carbon content.--The term ``carbon content''
            means the quantity of carbon (in carbon dioxide equivalent)
            contained in a fuel.</DELETED>
            <DELETED>    (3) Climate registry.--The term ``Climate
            Registry'' means the greenhouse gas emissions registry jointly
            established and managed by more than 40 States and Indian
            tribes to collect high-quality greenhouse gas emission data
            from facilities, corporations, and other organizations to
            support various greenhouse gas emission reporting and reduction
            policies for the member States and Indian tribes.</DELETED>
            <DELETED>    (4) Feedstock fossil fuel.--The term ``feedstock
            fossil fuel'' means fossil fuel used as raw material in a
            manufacturing process.</DELETED>
            <DELETED>    (5) Greenhouse gas emissions.--The term
            ``greenhouse gas emissions'' means emissions of a greenhouse
            gas, including--</DELETED>
                    <DELETED>    (A) stationary combustion source emissions
                    emitted as a result of combustion of fuels in
                    stationary equipment, such as boilers, furnaces,
                    burners, turbines, heaters, incinerators, engines,
                    flares, and other similar sources;</DELETED>
                    <DELETED>    (B) process emissions consisting of
                    emissions from chemical or physical processes other
                    than combustion;</DELETED>
                    <DELETED>    (C) fugitive emissions consisting of
                    intentional and unintentional emissions from equipment
                    leaks, such as joints, seals, packing, and gaskets, or
                    from piles, pits, cooling towers, and other similar
                    sources; and</DELETED>
                    <DELETED>    (D) biogenic emissions resulting from
                    biological processes, such as anaerobic decomposition,
                    nitrification, and denitrification.</DELETED>
            <DELETED>    (6) Indian tribe.--The term ``Indian tribe'' has
            the meaning given the term in section 4 of the Indian Self-
            Determination and Education Assistance Act (25 U.S.C.
            450b).</DELETED>
            <DELETED>    (7) Registry.--The term ``Registry'' means the
            Federal greenhouse gas registry established under section
            1105(a).</DELETED>
            <DELETED>    (8) Source.--The term ``source'' means any
            building, structure, installation, unit, point, operation,
            vehicle, land area, or other item that emits or may emit a
            greenhouse gas.</DELETED>

    <DELETED>SEC. 1103. REPORTING REQUIREMENTS.</DELETED>

    <DELETED>    (a) In General.--Subject to this section, each affected
    facility shall submit to the Administrator, for inclusion in the
    Registry, periodic reports, including annual and quarterly data, that--
    </DELETED>
            <DELETED>    (1) include the quantity and type of fossil fuels,
            including feedstock fossil fuels, that are extracted, produced,
            refined, imported, exported, or consumed at or by the
            facility;</DELETED>
            <DELETED>    (2) include the quantity of hydrofluorocarbons,
            perfluorocarbons, sulfur hexafluoride, nitrous oxide, carbon
            dioxide that has been captured and sequestered, and other
            greenhouse gases generated, produced, imported, exported, or
            consumed at or by the facility;</DELETED>
            <DELETED>    (3) include the quantity of electricity generated,
            imported, exported, or consumed by or at the facility, and
            information on the quantity of greenhouse gases emitted when
            the imported, exported, or consumed electricity was generated,
            as determined by the Administrator;</DELETED>
            <DELETED>    (4) include the aggregate quantity of all
            greenhouse gas emissions from sources at the facility,
            including stationary combustion source emissions, process
            emissions, and fugitive emissions;</DELETED>
            <DELETED>    (5) include greenhouse gas emissions expressed in
            metric tons of each greenhouse gas emitted and in the quantity
            of carbon dioxide equivalents of each greenhouse gas
            emitted;</DELETED>
            <DELETED>    (6) include a list and description of sources of
            greenhouse gas emissions at the facility;</DELETED>
            <DELETED>    (7) quantify greenhouse gas emissions in
            accordance with the measurement standards established under
            section 1104;</DELETED>
            <DELETED>    (8) include other data necessary for accurate and
            complete accounting of greenhouse gas emissions, as determined
            by the Administrator;</DELETED>
            <DELETED>    (9) include an appropriate certification regarding
            the accuracy and completeness of reported data, as determined
            by the Administrator; and</DELETED>
            <DELETED>    (10) are submitted electronically to the
            Administrator, in such form and to such extent as may be
            required by the Administrator.</DELETED>
    <DELETED>    (b) De Minimis Exemptions.--</DELETED>
            <DELETED>    (1) In general.--The Administrator may determine--
            </DELETED>
                    <DELETED>    (A) whether certain sources at a facility
                    should be considered to be eligible for a de minimis
                    exemption from a requirement for reporting under
                    subsection (a); and</DELETED>
                    <DELETED>    (B) the level of greenhouse gases emitted
                    from a source that would qualify for such an
                    exemption.</DELETED>
            <DELETED>    (2) Factors.--In making a determination under
            paragraph (1), the Administrator shall consider the
            availability and suitability of simplified techniques and tools
            for quantifying emissions and the cost to measure those
            emissions relative to the purposes of this title, including the
            goal of collecting complete and consistent facility-wide
            data.</DELETED>
    <DELETED>    (c) Verification of Report Required.--Before including the
    information from a report required under this section in the Registry,
    the Administrator shall verify the completeness and accuracy of the
    report using information provided under this section, obtained under
    section 9003(c), or obtained under other provisions of law.</DELETED>
    <DELETED>    (d) Timing.--</DELETED>
            <DELETED>    (1) Calendar years 2004 through 2007.--For a
            baseline period of calendar years 2004 through 2007, each
            affected facility shall submit required annual data described
            in this section to the Administrator not later than March 31,
            2009.</DELETED>
            <DELETED>    (2) Subsequent calendar years.--For calendar year
            2008 and each subsequent calendar year, each affected facility
            shall submit quarterly data described in this section to the
            Administrator not later than 60 days after the end of the
            applicable quarter.</DELETED>
    <DELETED>    (e) No Effect on Other Requirements.--Nothing in this
    title affects any requirement in effect as of the date of enactment of
    this Act relating to the reporting of--</DELETED>
            <DELETED>    (1) fossil fuel production, refining, importation,
            exportation, or consumption data;</DELETED>
            <DELETED>    (2) greenhouse gas emission data; or</DELETED>
            <DELETED>    (3) other relevant data.</DELETED>

    <DELETED>SEC. 1104. DATA QUALITY AND VERIFICATION.</DELETED>

    <DELETED>    (a) Protocols and Methods.--</DELETED>
            <DELETED>    (1) In general.--The Administrator shall establish
            by regulation, taking into account the work done by the Climate
            Registry, comprehensive protocols and methods to ensure the
            accuracy, completeness, consistency, and transparency of data
            on greenhouse gas emissions and fossil fuel production,
            refining, importation, exportation, and consumption submitted
            to the Registry that include--</DELETED>
                    <DELETED>    (A) accounting and reporting standards for
                    fossil fuel production, refining, importation,
                    exportation, and consumption;</DELETED>
                    <DELETED>    (B) a requirement that, where
                    technologically feasible, submitted data are monitored
                    using monitoring systems for fuel flow or emissions,
                    such as continuous emission monitoring systems or
                    equivalent systems of similar rigor, accuracy, quality,
                    and timeliness;</DELETED>
                    <DELETED>    (C) a requirement that, if a facility has
                    already been directed to monitor emissions of a
                    greenhouse gas using a continuous emission monitoring
                    system under existing law, that system be used in
                    complying with this Act with respect to the greenhouse
                    gas;</DELETED>
                    <DELETED>    (D) for cases in which the Administrator
                    determines that monitoring emissions with the
                    precision, reliability, accessibility, and timeliness
                    similar to that provided by a continuous emission
                    monitoring system are not technologically feasible,
                    standardized methods for calculating greenhouse gas
                    emissions in specific industries using other readily
                    available and reliable information, such as fuel
                    consumption, materials consumption, production, or
                    other relevant activity data, on the condition that
                    those methods do not underreport emissions, as compared
                    with the continuous emission monitoring
                    system;</DELETED>
                    <DELETED>    (E) information on the accuracy of
                    measurement and calculation methods;</DELETED>
                    <DELETED>    (F) methods to avoid double-counting of
                    greenhouse gas emissions;</DELETED>
                    <DELETED>    (G) protocols to prevent an affected
                    facility from avoiding the reporting requirements of
                    this title; and</DELETED>
                    <DELETED>    (H) protocols for verification of data
                    submitted by affected facilities.</DELETED>
            <DELETED>    (2) Best practices.--The protocols and methods
            developed under paragraph (1) shall incorporate and conform to
            the best practices from the most recent Federal, State, and
            international protocols for the measurement, accounting,
            reporting, and verification of greenhouse gas emissions to
            ensure the accuracy, completeness, and consistency of the
            data.</DELETED>
    <DELETED>    (b) Verification; Information by Reporting Entities.--Each
    affected facility shall--</DELETED>
            <DELETED>    (1) provide information sufficient for the
            Administrator to verify, in accordance with the protocols and
            methods developed under subsection (a), that the fossil fuel
            data and greenhouse gas emission data of the affected facility
            have been completely and accurately reported; and</DELETED>
            <DELETED>    (2) ensure the submission or retention, for the 5-
            year period beginning on the date of provision of the
            information, of--</DELETED>
                    <DELETED>    (A) data sources;</DELETED>
                    <DELETED>    (B) information on internal control
                    activities;</DELETED>
                    <DELETED>    (C) information on assumptions used in
                    reporting emissions and fuels;</DELETED>
                    <DELETED>    (D) uncertainty analyses; and</DELETED>
                    <DELETED>    (E) other relevant data and information to
                    facilitate the verification of reports submitted to the
                    Registry.</DELETED>
    <DELETED>    (c) Waiver of Reporting Requirements.--The Administrator
    may waive reporting requirements for specific facilities if the
    Administrator determines that sufficient and equally or more reliable
    data are available under other provisions of law.</DELETED>
    <DELETED>    (d) Missing Data.--If information, satisfactory to the
    Administrator, is not provided for an affected facility, the
    Administrator shall--</DELETED>
            <DELETED>    (1) prescribe methods to estimate emissions for
            the facility for each period for which data are missing,
            reflecting the highest emission levels that may reasonably have
            occurred during the period for which data are missing;
            and</DELETED>
            <DELETED>    (2) take appropriate enforcement action pursuant
            to this section and section 9003(b).</DELETED>

    <DELETED>SEC. 1105. FEDERAL GREENHOUSE GAS REGISTRY.</DELETED>

    <DELETED>    (a) Establishment.--The Administrator shall establish a
    Federal greenhouse gas registry.</DELETED>
    <DELETED>    (b) Administration.--In establishing the Registry, the
    Administrator shall--</DELETED>
            <DELETED>    (1) design and operate the Registry;</DELETED>
            <DELETED>    (2) establish an advisory body that is broadly
            representative of private enterprise, agriculture,
            environmental groups, and State, tribal, and local governments
            to guide the development and management of the
            Registry;</DELETED>
            <DELETED>    (3) provide coordination and technical assistance
            for the development of proposed protocols and methods, taking
            into account the duties carried out by the Climate Registry, to
            be published by the Administrator;</DELETED>
            <DELETED>    (4)(A) develop an electronic format for reporting
            under guidelines established under section 1104(a)(1);
            and</DELETED>
            <DELETED>    (B) make the electronic format available to
            reporting entities;</DELETED>
            <DELETED>    (5) verify and audit the data submitted by
            reporting entities;</DELETED>
            <DELETED>    (6) establish consistent policies for calculating
            carbon content and greenhouse gas emissions for each type of
            fossil fuel reported under section 1103;</DELETED>
            <DELETED>    (7) calculate carbon content and greenhouse gas
            emissions associated with the combustion of fossil fuel data
            reported by reporting entities;</DELETED>
            <DELETED>    (8) immediately publish on the Internet all
            information contained in the Registry, except in any case in
            which publishing the information would result in a disclosure
            of--</DELETED>
                    <DELETED>    (A) information vital to national
                    security, as determined by the President; or</DELETED>
                    <DELETED>    (B) confidential business information that
                    cannot be derived from information that is otherwise
                    publicly available and that would cause significant
                    calculable competitive harm if published (except that
                    information relating to greenhouse gas emissions shall
                    not be considered to be confidential business
                    information).</DELETED>
    <DELETED>    (c) Third-Party Verification.--The Administrator may use
    the services of third parties that have no conflicts of interest to
    verify reports required under section 1103.</DELETED>
    <DELETED>    (d) Regulations.--The Administrator shall--</DELETED>
            <DELETED>    (1) not later than 180 days after the date of
            enactment of this Act, propose regulations to carry out this
            section; and</DELETED>
            <DELETED>    (2) not later than July 1, 2008, promulgate final
            regulations to carry out this section.</DELETED>

    <DELETED>SEC. 1106. ENFORCEMENT.</DELETED>

    <DELETED>    (a) Civil Actions.--The Administrator may bring a civil
    action in United States district court against the owner or operator of
    an affected facility that fails to comply with any requirement of this
    subtitle.</DELETED>
    <DELETED>    (b) Penalty.--Any person that has violated or is violating
    this subtitle shall be subject to a civil penalty of not more than
    $25,000 per day of each violation.</DELETED>

               <DELETED>Subtitle B--Reducing Emissions</DELETED>

    <DELETED>SEC. 1201. EMISSION ALLOWANCE ACCOUNT.</DELETED>

    <DELETED>    (a) In General.--The Administrator shall establish a
    separate quantity of emission allowances for each of calendar years
    2012 through 2050.</DELETED>
    <DELETED>    (b) Identification Numbers.--The Administrator shall
    assign to each emission allowance established under subsection (a) a
    unique identification number that includes the calendar year for which
    that emission allowance was established.</DELETED>
    <DELETED>    (c) Legal Status of Emission Allowances.--</DELETED>
            <DELETED>    (1) In general.--An emission allowance shall not
            be a property right.</DELETED>
            <DELETED>    (2) Termination or limitation.--Nothing in this
            Act or any other provision of law limits the authority of the
            United States to terminate or limit an emission
            allowance.</DELETED>
            <DELETED>    (3) Other provisions unaffected.--Nothing in this
            Act relating to emission allowances shall affect the
            application of, or compliance with, any other provision of law
            to or by a covered facility.</DELETED>
    <DELETED>    (d) Allowances for Each Calendar Year.--The numbers of
    emission allowances established by the Administrator for each of
    calendar years 2012 through 2050 shall be as follows:</DELETED>

    ----------------------------------------------------------------------------------------------------------------
                                                                                  Number of Emission Allowances (in
                                   Calendar Year                                              Millions)
    ----------------------------------------------------------------------------------------------------------------
    2012                                                                                                      5,200
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2013                                                                                                      5,104
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2014                                                                                                      5,008
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2015                                                                                                      4,912
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2016                                                                                                      4,816
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2017                                                                                                      4,720
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2018                                                                                                      4,624
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2019                                                                                                      4,528
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2020                                                                                                      4,432
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2021                                                                                                      4,336
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2022                                                                                                      4,240
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2023                                                                                                      4,144
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2024                                                                                                      4,048
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2025                                                                                                      3,952
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2026                                                                                                      3,856
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2027                                                                                                      3,760
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2028                                                                                                      3,664
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2029                                                                                                      3,568
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2030                                                                                                      3,472
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2031                                                                                                      3,376
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2032                                                                                                      3,280
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2033                                                                                                      3,184
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2034                                                                                                      3,088
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2035                                                                                                      2,992
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2036                                                                                                      2,896
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2037                                                                                                      2,800
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2038                                                                                                      2.704
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2039                                                                                                      2,608
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2040                                                                                                      2,512
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2041                                                                                                      2,416
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2042                                                                                                      2,320
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2043                                                                                                      2,224
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2044                                                                                                      2,128
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2045                                                                                                      2,032
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2046                                                                                                      1,936
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2047                                                                                                      1,840
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2048                                                                                                      1,744
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2049                                                                                                      1,646
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2050                                                                                                      1,560
    ----------------------------------------------------------------------------------------------------------------

    <DELETED>SEC. 1202. COMPLIANCE OBLIGATION.</DELETED>

    <DELETED>    (a) In General.--Not later than 90 days after the end of a
    calendar year, the owner or operator of a covered facility shall submit
    to the Administrator an emission allowance, an offset allowance awarded
    pursuant to subtitle D of title II, or an international allowance or
    credit obtained in compliance with regulations promulgated under
    section 2502, for each carbon dioxide equivalent of greenhouse gas
    that--</DELETED>
            <DELETED>    (1) was emitted by that facility during the
            preceding year;</DELETED>
            <DELETED>    (2) will, assuming no capture and permanent
            geological sequestration of that gas, be emitted from the use
            of any petroleum- or coal-based transportation fuel that was
            produced or imported at that facility during the preceding
            year; and</DELETED>
            <DELETED>    (3) will, assuming no capture and destruction or
            permanent geological sequestration of that gas, be emitted from
            any nonfuel chemical that was produced or imported at that
            facility during the preceding year.</DELETED>
    <DELETED>    (b) Retirement of Allowances.--Immediately upon receipt of
    an emission allowance under subsection (a), the Administrator shall
    retire the emission allowance.</DELETED>
    <DELETED>    (c) Determination of Compliance.--Not later than July 1 of
    each year, the Administrator shall determine whether the owners and
    operators of all covered facilities are in full compliance with
    subsection (a) for the preceding year.</DELETED>

    <DELETED>SEC. 1203. PENALTY FOR NONCOMPLIANCE.</DELETED>

    <DELETED>    (a) Excess Emissions Penalty.--</DELETED>
            <DELETED>    (1) In general.--The owner or operator of any
            covered facility that fails for any year to submit to the
            Administrator by the deadline described in section 1202(a) or
            2303, 1 or more of the emission allowances due pursuant to
            either of those sections shall be liable for the payment to the
            Administrator of an excess emissions penalty.</DELETED>
            <DELETED>    (2) Amount.--The amount of an excess emissions
            penalty required to be paid under paragraph (1) shall be, as
            determined by the Administrator, an amount equal to the product
            obtained by multiplying--</DELETED>
                    <DELETED>    (A) the number of excess emission
                    allowances that the owner or operator failed to submit;
                    and</DELETED>
                    <DELETED>    (B) the greater of--</DELETED>
                            <DELETED>    (i) $200; or</DELETED>
                            <DELETED>    (ii) a dollar figure representing
                            3 times the mean market value of an emission
                            allowance during the calendar year for which
                            the emission allowances were due.</DELETED>
            <DELETED>    (3) Timing.--An excess emissions penalty required
            under this subsection shall be immediately due and payable to
            the Administrator, without demand, in accordance with such
            regulations as shall be promulgated by the Administrator by the
            date that is 1 year after the date of enactment of this
            Act.</DELETED>
            <DELETED>    (4) Deposit.--The Administrator shall deposit each
            excess emissions penalty paid under this subsection in the
            Treasury of the United States.</DELETED>
            <DELETED>    (5) No effect on liability.--An excess emissions
            penalty due and payable by the owner or operator of a covered
            facility under this subsection shall not diminish the liability
            of the owner or operator for any fine, penalty, or assessment
            against the owner or operator for the same violation under any
            other provision of this Act or any other law.</DELETED>
    <DELETED>    (b) Excess Emission Allowance.--</DELETED>
            <DELETED>    (1) In general.--The owner or operator of a
            covered facility that fails for any year to submit to the
            Administrator by the deadline described in section 1202(a) or
            2303 1 or more of the emission allowances due pursuant to
            either of those sections shall be liable to offset the excess
            emissions by an equal quantity, in tons, during--</DELETED>
                    <DELETED>    (A) the following calendar year;
                    or</DELETED>
                    <DELETED>    (B) such longer period as the
                    Administrator may prescribe.</DELETED>
            <DELETED>    (2) Plan.--</DELETED>
                    <DELETED>    (A) In general.--Not later than 60 days
                    after the end of the calendar year during which a
                    covered facility emits excess emissions, the owner or
                    operator of the covered facility shall submit to the
                    Administrator, and to the State in which the covered
                    facility is located, a proposed plan to achieve the
                    required offsets for the excess emissions.</DELETED>
                    <DELETED>    (B) Condition of operation.--Upon approval
                    of a proposed plan described in subparagraph (A) by the
                    Administrator, the plan, as submitted, modified, or
                    conditioned, shall be considered to be a condition of
                    the operating permit for the covered facility, without
                    further review or revision of the permit.</DELETED>
                    <DELETED>    (C) Deduction of allowances.--For each
                    covered facility that, in any calendar year, emits
                    excess emissions, the Administrator shall deduct, from
                    emission allowances allocated to the covered facility
                    for the calendar year, or for succeeding years during
                    which offsets are required, emission allowances equal
                    to the excess quantity, in tons, of the excess
                    emissions.</DELETED>
    <DELETED>    (c) Prohibition.--It shall be unlawful for the owner or
    operator of any facility liable for a penalty and offset under this
    section to fail--</DELETED>
            <DELETED>    (1) to pay the penalty in accordance with this
            section;</DELETED>
            <DELETED>    (2) to provide, and thereafter comply with, a
            proposed plan for compliance as required by subsection (b)(2);
            and</DELETED>
            <DELETED>    (3) to offset excess emissions as required by
            subsection (b)(1).</DELETED>
    <DELETED>    (d) No Effect on Other Section.--Nothing in this subtitle
    limits or otherwise affects the application of section
    9003(b).</DELETED>

     <DELETED>TITLE II--MANAGING AND CONTAINING COSTS EFFICIENTLY</DELETED>

                     <DELETED>Subtitle A--Trading</DELETED>

    <DELETED>SEC. 2101. SALE, EXCHANGE, AND RETIREMENT OF EMISSION
                  ALLOWANCES.</DELETED>

    <DELETED>    Except as otherwise provided in this Act, the lawful
    holder of an emission allowance may sell, exchange, transfer, submit
    for compliance in accordance with section 1202, or retire the emission
    allowance.</DELETED>

    <DELETED>SEC. 2102. NO RESTRICTION ON TRANSACTIONS.</DELETED>

    <DELETED>    The privilege of purchasing, holding, selling, exchanging,
    and retiring emission allowances shall not be restricted to the owners
    and operators of covered facilities.</DELETED>

    <DELETED>SEC. 2103. ALLOWANCE TRANSFER SYSTEM.</DELETED>

    <DELETED>    (a) In General.--Not later than 18 months after the date
    of enactment of this Act, the Administrator shall promulgate
    regulations to carry out the provisions of this Act relating to
    emission allowances, including regulations providing that the transfer
    of emission allowances shall not be effective until such date as a
    written certification of the transfer, signed by a responsible official
    of each party to the transfer, is received and recorded by the
    Administrator in accordance with those regulations.</DELETED>
    <DELETED>    (b) Transfers.--</DELETED>
            <DELETED>    (1) In general.--The regulations promulgated under
            subsection (a) shall permit the transfer of allowances prior to
            the issuance of the allowances.</DELETED>
            <DELETED>    (2) Deduction and addition of transfers.--A
            recorded pre-allocation transfer of allowances shall be--
            </DELETED>
                    <DELETED>    (A) deducted by the Administrator from the
                    number of allowances that would otherwise be
                    distributed to the transferor; and</DELETED>
                    <DELETED>    (B) added to those allowances distributed
                    to the transferee.</DELETED>

    <DELETED>SEC. 2104. ALLOWANCE TRACKING SYSTEM.</DELETED>

    <DELETED>    The regulations promulgated under section 2103(a) shall
    include a system for issuing, recording, and tracking emission
    allowances that shall specify all necessary procedures and requirements
    for an orderly and competitive functioning of the emission allowance
    system.</DELETED>

                     <DELETED>Subtitle B--Banking</DELETED>

    <DELETED>SEC. 2201. INDICATION OF CALENDAR YEAR.</DELETED>

    <DELETED>    An emission allowance submitted to the Administrator by
    the owner or operator of a covered facility in accordance with section
    1202(a) shall not be required to indicate in the identification number
    of the emission allowance the calendar year for which the emission
    allowance is submitted.</DELETED>

    <DELETED>SEC. 2202. EFFECT OF TIME.</DELETED>

    <DELETED>    The passage of time shall not, by itself, cause an
    emission allowance to be retired or otherwise diminish the compliance
    value of the emission allowance.</DELETED>

                    <DELETED>Subtitle C--Borrowing</DELETED>

    <DELETED>SEC. 2301. REGULATIONS.</DELETED>

    <DELETED>    (a) In General.--Not later than 3 years after the date of
    enactment of this Act, the Administrator shall promulgate regulations
    under which, subject to subsection (b), the owner or operator of a
    covered facility may--</DELETED>
            <DELETED>    (1) borrow emission allowances from the
            Administrator; and</DELETED>
            <DELETED>    (2) for a calendar year, submit borrowed emission
            allowances to the Administrator in satisfaction of up to 15
            percent of the compliance obligation under section
            1202(a).</DELETED>
    <DELETED>    (b) Limitation.--An emission allowance borrowed under
    subsection (a) shall be an emission allowance established by the
    Administrator for a specific future calendar year under subsection
    1201(a).</DELETED>

    <DELETED>SEC. 2302. TERM.</DELETED>

    <DELETED>    The owner or operator of a covered facility shall not
    submit, and the Administrator shall not accept, a borrowed emission
    allowance in partial satisfaction of the compliance obligation under
    section 1202(a) for any calendar year that is more than 5 years earlier
    than the calendar year included in the identification number of the
    borrowed emission allowance.</DELETED>

    <DELETED>SEC. 2303. REPAYMENT WITH INTEREST.</DELETED>

    <DELETED>    For each borrowed emission allowance submitted in partial
    satisfaction of the compliance obligation under subsection 1202(a) for
    a particular calendar year (referred to in this section as the ``use
    year''), the number of emission allowances that the owner or operator
    is required to submit under section 1202(a) for the year from which the
    borrowed emission allowance was taken (referred to in this section as
    the ``source year'') shall be increased by an amount equal to the
    product obtained by multiplying--</DELETED>
            <DELETED>    (1) 1.1; and</DELETED>
            <DELETED>    (2) the number of years beginning after the use
            year and before the source year.</DELETED>

                     <DELETED>Subtitle D--Offsets</DELETED>

    <DELETED>SEC. 2401. OUTREACH INITIATIVE ON REVENUE ENHANCEMENT FOR
                  AGRICULTURAL PRODUCERS.</DELETED>

    <DELETED>    (a) Establishment.--The Secretary of Agriculture, acting
    through the Chief of the Natural Resources Conservation Service, the
    Chief of the Forest Service, the Administrator of the Cooperative State
    Research, Education, and Extension Service, and land-grant colleges and
    universities, in consultation with the Administrator and the heads of
    other appropriate departments and agencies, shall establish an outreach
    initiative to provide information to agricultural producers,
    agricultural organizations, foresters, and other landowners about
    opportunities under this subtitle to earn new revenue.</DELETED>
    <DELETED>    (b) Components.--The initiative under this section--
    </DELETED>
            <DELETED>    (1) shall be designed to ensure that, to the
            maximum extent practicable, agricultural organizations and
            individual agricultural producers, foresters, and other
            landowners receive detailed practical information about--
            </DELETED>
                    <DELETED>    (A) opportunities to earn new revenue
                    under this subtitle;</DELETED>
                    <DELETED>    (B) measurement protocols, monitoring,
                    verifying, inventorying, registering, insuring, and
                    marketing offsets under this title;</DELETED>
                    <DELETED>    (C) emerging domestic and international
                    markets for energy crops, allowances, and offsets;
                    and</DELETED>
                    <DELETED>    (D) local, regional, and national
                    databases and aggregation networks to facilitate
                    achievement, measurement, registration, and sales of
                    offsets;</DELETED>
            <DELETED>    (2) shall provide--</DELETED>
                    <DELETED>    (A) outreach materials, including the
                    handbook published under subsection (c), to interested
                    parties;</DELETED>
                    <DELETED>    (B) workshops; and</DELETED>
                    <DELETED>    (C) technical assistance; and</DELETED>
            <DELETED>    (3) may include the creation and development of
            regional marketing centers or coordination with existing
            centers (including centers within the Natural Resources
            Conservation Service or the Cooperative State Research,
            Education, and Extension Service or at land-grant colleges and
            universities).</DELETED>
    <DELETED>    (c) Handbook.--</DELETED>
            <DELETED>    (1) In general.--Not later than 2 years after the
            date of enactment of this Act, the Secretary of Agriculture, in
            consultation with the Administrator and after an opportunity
            for public comment, shall publish a handbook for use by
            agricultural producers, agricultural cooperatives, foresters,
            other landowners, offset buyers, and other stakeholders that
            provides easy-to-use guidance on achieving, reporting,
            registering, and marketing offsets.</DELETED>
            <DELETED>    (2) Distribution.--The Secretary of Agriculture
            shall ensure, to the maximum extent practicable, that the
            handbook--</DELETED>
                    <DELETED>    (A) is made available through the Internet
                    and in other electronic media;</DELETED>
                    <DELETED>    (B) includes, with respect to the
                    electronic form of the handbook described in
                    subparagraph (A), electronic forms and calculation
                    tools to facilitate the petition process described in
                    section 2404; and</DELETED>
                    <DELETED>    (C) is distributed widely through land-
                    grant colleges and universities and other appropriate
                    institutions.</DELETED>

    <DELETED>SEC. 2402. ESTABLISHMENT OF DOMESTIC OFFSET PROGRAM.</DELETED>

    <DELETED>    (a) Alternative Means of Compliance.--Beginning with
    calendar year 2012, the owner or operator of a covered entity may
    satisfy 15 percent of the total allowance submission requirement of the
    covered entity under section 1202(a) by submitting offset allowances
    generated in accordance with this subtitle.</DELETED>
    <DELETED>    (b) Regulations Required.--Not later than 18 months after
    the date of enactment of this Act, the Administrator, in consultation
    with the Secretary of Agriculture, shall promulgate regulations
    authorizing the issuance and certification of offset allowances from
    certain agricultural, forestry, and other land use-related projects
    undertaken within the United States, and certain other projects
    identified by the Administrator under section 2403(b)(4), including
    provisions that--</DELETED>
            <DELETED>    (1) ensure that those offsets represent real,
            verifiable, additional, permanent, and enforceable reductions
            in greenhouse gas emissions or increases in biological
            sequestration;</DELETED>
            <DELETED>    (2) specify the types of offset projects eligible
            to generate offset allowances, in accordance with section
            2403;</DELETED>
            <DELETED>    (3) establish procedures for project initiation
            and approval, in accordance with section 2404;</DELETED>
            <DELETED>    (4) establish procedures to monitor, quantify, and
            discount reductions in greenhouse gas emissions or increases in
            biological sequestration, in accordance with subsections (d)
            through (g) of section 2404;</DELETED>
            <DELETED>    (5) establish procedures for verification,
            registration, and issuance of offset allowances, in accordance
            with section 2405; and</DELETED>
            <DELETED>    (6) ensure permanence of offsets by mitigating and
            compensating for reversals, in accordance with section
            2406.</DELETED>
    <DELETED>    (c) Offset Allowances Awarded.--The Administrator shall
    issue offset allowances for qualifying emission reductions and
    biological sequestrations from offset projects that satisfy the
    applicable requirements of this subtitle.</DELETED>
    <DELETED>    (d) Ownership.--Initial ownership of an offset allowance
    shall lie with a project developer, unless otherwise specified in a
    legally-binding contract or agreement.</DELETED>
    <DELETED>    (e) Transferability.--An offset allowance generated
    pursuant to this subtitle may be sold, traded, or transferred, on the
    conditions that--</DELETED>
            <DELETED>    (1) the offset allowance has not expired or been
            retired or canceled; and</DELETED>
            <DELETED>    (2) liability and responsibility for mitigating
            and compensating for reversals of registered offset allowances
            is specified in accordance with section 2406(b).</DELETED>

    <DELETED>SEC. 2403. ELIGIBLE AGRICULTURAL AND FORESTRY OFFSET PROJECT
                  TYPES.</DELETED>

    <DELETED>    (a) In General.--Offset allowances from agricultural,
    forestry, and other land use-related projects shall be limited to those
    allowances achieving an offset of 1 or more greenhouse gases by a
    method other than a reduction of combustion of greenhouse gas-emitting
    fuel.</DELETED>
    <DELETED>    (b) Categories of Eligible Agricultural, Forestry, and
    Other Land Use-Related Projects.--Subject to the requirements
    promulgated pursuant to section 2402(b), the types of operations
    eligible to generate offset allowances under this subtitle include--
    </DELETED>
            <DELETED>    (1) agricultural and rangeland sequestration and
            management practices, including--</DELETED>
                    <DELETED>    (A) altered tillage practices;</DELETED>
                    <DELETED>    (B) winter cover cropping, continuous
                    cropping, and other means to increase biomass returned
                    to soil in lieu of planting followed by
                    fallowing;</DELETED>
                    <DELETED>    (C) conversion of cropland to rangeland or
                    grassland, on the condition that the land has been in
                    nonforest use for at least 10 years before the date of
                    initiation of the project;</DELETED>
                    <DELETED>    (D) reduction of nitrogen fertilizer use
                    or increase in nitrogen use efficiency;</DELETED>
                    <DELETED>    (E) reduction in the frequency and
                    duration of flooding of rice paddies; and</DELETED>
                    <DELETED>    (F) reduction in carbon emissions from
                    organic soils;</DELETED>
            <DELETED>    (2) changes in carbon stocks attributed to land
            use change and forestry activities limited to--</DELETED>
                    <DELETED>    (A) afforestation or reforestation of
                    acreage not forested as of the date of enactment of
                    this Act; and</DELETED>
                    <DELETED>    (B) forest management resulting in an
                    increase in forest stand volume;</DELETED>
            <DELETED>    (3) manure management and disposal, including--
            </DELETED>
                    <DELETED>    (A) waste aeration; and</DELETED>
                    <DELETED>    (B) methane capture and
                    combustion;</DELETED>
            <DELETED>    (4) subject to the requirements of this subtitle,
            any other terrestrial offset practices identified by the
            Administrator, including--</DELETED>
                    <DELETED>    (A) the capture or reduction of noncovered
                    fugitive emissions;</DELETED>
                    <DELETED>    (B) methane capture and combustion at
                    nonagricultural facilities; and</DELETED>
                    <DELETED>    (C) other actions that result in the
                    avoidance or reduction of greenhouse gas emissions in
                    accordance with section 2402; and</DELETED>
            <DELETED>    (5) combinations of any of the offset practices
            described in paragraphs (1) through (4).</DELETED>
    <DELETED>    (c) Exclusion.--A project participating in a Federal,
    State, or local cost-sharing, competitive grant, or technical
    assistance program shall not be eligible to generate offset allowances
    under this subtitle.</DELETED>
    <DELETED>    (d) Earned Allowances.--</DELETED>
            <DELETED>    (1) In general.--Any project approved by the
            Administrator shall earn offset allowances in proportion to the
            private investment in the project, as described in paragraph
            (2).</DELETED>
            <DELETED>    (2) Private investment.--</DELETED>
                    <DELETED>    (A) In general.--Except as provided in
                    subparagraph (B), the private share of investment in
                    the project shall be assumed to be 50
                    percent.</DELETED>
                    <DELETED>    (B) Demonstration of investment.--
                    Subparagraph (A) shall not apply in any case in which a
                    project elects to demonstrate the private share of
                    investment in the project in accordance with rules
                    established by the Administrator.</DELETED>

    <DELETED>SEC. 2404. PROJECT INITIATION AND APPROVAL.</DELETED>

    <DELETED>    (a) Project Approval.--A project developer--</DELETED>
            <DELETED>    (1) may submit a petition for offset project
            approval at any time following the effective date of
            regulations promulgated under section 2402(b); but</DELETED>
            <DELETED>    (2) may not register or issue offset allowances
            until such approval is received and until after the emission
            reductions or sequestrations supporting the offset allowances
            have actually occurred.</DELETED>
    <DELETED>    (b) Petition Process.--Prior to offset registration and
    issuance of offset allowances, a project developer shall submit a
    petition to the Administrator, consisting of--</DELETED>
            <DELETED>    (1) a copy of the monitoring and quantification
            plan prepared for the offset project, as described under
            subsection (d);</DELETED>
            <DELETED>    (2) a greenhouse gas initiation certification, as
            described under subsection (e); and</DELETED>
            <DELETED>    (3) subject to the requirements of this subtitle,
            any other information identified by the Administrator as
            necessary to meet the objectives of this subtitle.</DELETED>
    <DELETED>    (c) Approval and Notification.--</DELETED>
            <DELETED>    (1) In general.--Not later than 180 days after the
            date on which the Administrator receives a complete petition
            under subsection (b), the Administrator shall--</DELETED>
                    <DELETED>    (A) determine whether the monitoring and
                    quantification plan satisfies the applicable
                    requirements of this subtitle;</DELETED>
                    <DELETED>    (B) determine whether the greenhouse gas
                    initiation certification indicates a significant
                    deviation in accordance with subsection
                    (e)(3);</DELETED>
                    <DELETED>    (C) notify the project developer of the
                    determinations under subparagraphs (A) and (B);
                    and</DELETED>
                    <DELETED>    (D) issue offset allowances for approved
                    projects.</DELETED>
            <DELETED>    (2) Appeal.--The Administrator shall establish
            mechanisms for appeal and review of determinations made under
            this subsection.</DELETED>
    <DELETED>    (d) Monitoring and Quantification.--</DELETED>
            <DELETED>    (1) In general.--A project developer shall make
            use of the standardized tools and methods described in this
            section to monitor, quantify, and discount reductions in
            greenhouse gas emissions or increases in
            sequestration.</DELETED>
            <DELETED>    (2) Monitoring and quantification plan.--A
            monitoring and quantification plan shall be used to monitor,
            quantify, and discount reductions in greenhouse gas emissions
            or increases in sequestration as described by this
            subsection.</DELETED>
            <DELETED>    (3) Plan completion and retention.--A monitoring
            and quantification plan shall be--</DELETED>
                    <DELETED>    (A) completed for all offset projects
                    prior to offset project initiation; and</DELETED>
                    <DELETED>    (B) retained by the project developer for
                    the duration of the offset project.</DELETED>
            <DELETED>    (4) Plan requirements.--Subject to section 2402,
            the Administrator shall specify the required components of a
            monitoring and quantification plan, including--</DELETED>
                    <DELETED>    (A) a description of the offset project,
                    including project type;</DELETED>
                    <DELETED>    (B) a determination of accounting
                    periods;</DELETED>
                    <DELETED>    (C) an assignment of reporting
                    responsibility;</DELETED>
                    <DELETED>    (D) the contents and timing of public
                    reports, including summaries of the original data, as
                    well as the results of any analyses;</DELETED>
                    <DELETED>    (E) a delineation of project boundaries,
                    based on methods and formats determined to be
                    acceptable to the Administrator;</DELETED>
                    <DELETED>    (F) a description of which of the
                    monitoring and quantification tools developed under
                    subsection (f) are to be used to monitor and quantify
                    changes in greenhouse gas fluxes or carbon stocks
                    associated with a project;</DELETED>
                    <DELETED>    (G) a description of which of the
                    standardized methods developed under subsection (g) to
                    be used to determine additionality, estimate the
                    baseline carbon, and discount for leakage;</DELETED>
                    <DELETED>    (H) based on the standardized methods
                    chosen in subparagraphs (F) and (G), a determination of
                    uncertainty in accordance with subsection
                    (h);</DELETED>
                    <DELETED>    (I) what site-specific data, if any, will
                    be used in monitoring, quantification, and the
                    determination of discounts;</DELETED>
                    <DELETED>    (J) a description of procedures for use in
                    managing and storing data, including quality-control
                    standards and methods, such as redundancy in case
                    records are lost; and</DELETED>
                    <DELETED>    (K) subject to the requirements of this
                    subtitle, any other information identified by the
                    Administrator as being necessary to meet the objectives
                    of this subtitle.</DELETED>
    <DELETED>    (e) Greenhouse Gas Initiation Certification.--</DELETED>
            <DELETED>    (1) In general.--In reviewing a petition submitted
            under subsection (b), the Administrator shall seek to exclude
            each activity that undermines the integrity of the offset
            program established under this subtitle, such as the conversion
            or clearing of land, or marked change in management regime, in
            anticipation of offset project initiation.</DELETED>
            <DELETED>    (2) Greenhouse gas initiation certification
            requirements.--A greenhouse gas initiation certification
            developed under this subsection shall include--</DELETED>
                    <DELETED>    (A) the estimated greenhouse gas flux or
                    carbon stock for the offset project for each of the 4
                    complete calendar years preceding the effective date of
                    the regulations promulgated under section 2402(b);
                    and</DELETED>
                    <DELETED>    (B) the estimated greenhouse gas flux or
                    carbon stock for the offset project, averaged across
                    each of the 4 calendar years preceding the effective
                    date of the regulations promulgated under section
                    2402(b).</DELETED>
            <DELETED>    (3) Determination of significant deviation.--Based
            on standards developed by the Administrator--</DELETED>
                    <DELETED>    (A) each greenhouse gas initiation
                    certification submitted pursuant to this section shall
                    be reviewed; and</DELETED>
                    <DELETED>    (B) a determination shall be made as to
                    whether, as a result of activities or behavior
                    inconsistent with the purposes of this title, a
                    significant deviation exists between the average annual
                    greenhouse gas flux or carbon stock and the greenhouse
                    gas flux or carbon stock for a given year.</DELETED>
    <DELETED>    (f) Development of Monitoring and Quantification Tools for
    Agricultural and Forestry Projects.--</DELETED>
            <DELETED>    (1) In general.--Subject to section 2402(b), the
            Administrator, in consultation with the Secretary of
            Agriculture, shall develop standardized tools for use in the
            monitoring and quantification of changes in greenhouse gas
            fluxes or carbon stocks for each offset project type listed
            under section 2403(b).</DELETED>
            <DELETED>    (2) Tool development.--The tools used to monitor
            and quantify changes in greenhouse gas fluxes or carbon stocks
            shall, for each project type, include applicable--</DELETED>
                    <DELETED>    (A) statistically-sound field and remote
                    sensing sampling methods, procedures, techniques,
                    protocols, or programs;</DELETED>
                    <DELETED>    (B) models, factors, equations, or look-up
                    tables; and</DELETED>
                    <DELETED>    (C) any other process or tool considered
                    to be acceptable by the Administrator, in consultation
                    with the Secretary of Agriculture.</DELETED>
    <DELETED>    (g) Development of Accounting and Discounting Methods.--
    </DELETED>
            <DELETED>    (1) In general.--The Administrator, in
            consultation with the Secretary of Agriculture, shall--
            </DELETED>
                    <DELETED>    (A) develop standardized methods for use
                    in accounting for additionality and uncertainty,
                    estimating the baseline, and discounting for leakage
                    for each offset project type listed under section
                    2403(b); and</DELETED>
                    <DELETED>    (B) require that leakage be subtracted
                    from reductions in greenhouse gas emissions or
                    increases in sequestration attributable to a
                    project.</DELETED>
            <DELETED>    (2) Additionality determination and baseline
            estimation.--The standardized methods used to determine
            additionality and establish baselines shall, for each project
            type, at a minimum--</DELETED>
                    <DELETED>    (A) in the case of a sequestration
                    project, determine the greenhouse gas flux and carbon
                    stock on comparable land identified on the basis of--
                    </DELETED>
                            <DELETED>    (i) similarity in current
                            management practices;</DELETED>
                            <DELETED>    (ii) similarity of regional,
                            State, or local policies or programs;
                            and</DELETED>
                            <DELETED>    (iii) similarity in geographical
                            and biophysical characteristics;</DELETED>
                    <DELETED>    (B) in the case of an emission reduction
                    project, use as a basis emissions from preexisting or
                    comparable facilities; and</DELETED>
                    <DELETED>    (C) in the case of a sequestration project
                    or emission reduction project, specify a selected time
                    period.</DELETED>
            <DELETED>    (3) Leakage.--The standardized methods used to
            determine and discount for leakage shall, at a minimum, take
            into consideration--</DELETED>
                    <DELETED>    (A) the scope of the offset system in
                    terms of activities and geography covered;</DELETED>
                    <DELETED>    (B) the markets relevant to the offset
                    project;</DELETED>
                    <DELETED>    (C) emission intensity per unit of
                    production, both inside and outside of the offset
                    project; and</DELETED>
                    <DELETED>    (D) a time period sufficient in length to
                    yield a stable leakage rate.</DELETED>
    <DELETED>    (h) Uncertainty for Agricultural and Forestry Projects.--
    </DELETED>
            <DELETED>    (1) In general.--The Administrator, in
            consultation with the Secretary of Agriculture, shall develop
            standardized methods for use in determining and discounting for
            uncertainty for each offset project type listed under section
            2403(b).</DELETED>
            <DELETED>    (2) Basis.--The standardized methods used to
            determine and discount for uncertainty shall be based on--
            </DELETED>
                    <DELETED>    (A) the robustness and rigor of the
                    methods used by a project developer to monitor and
                    quantify changes in greenhouse gas fluxes or carbon
                    stocks;</DELETED>
                    <DELETED>    (B) the robustness and rigor of methods
                    used by a project developer to determine additionality
                    and leakage; and</DELETED>
                    <DELETED>    (C) an exaggerated proportional discount
                    that increases relative to uncertainty, as determined
                    by the Administrator, to encourage better measurement
                    and accounting.</DELETED>
    <DELETED>    (i) Acquisition of New Data and Review of Methods for
    Agricultural and Forestry Projects.--The Administrator, in consultation
    with the Secretary of Agriculture, shall--</DELETED>
            <DELETED>    (1) establish a comprehensive field sampling
            program to improve the scientific bases on which the
            standardized tools and methods developed under this section are
            based; and</DELETED>
            <DELETED>    (2) review and revise the standardized tools and
            methods developed under this section, based on--</DELETED>
                    <DELETED>    (A) validation of existing methods,
                    protocols, procedures, techniques, factors, equations,
                    or models;</DELETED>
                    <DELETED>    (B) development of new methods, protocols,
                    procedures, techniques, factors, equations, or
                    models;</DELETED>
                    <DELETED>    (C) increased availability of field data
                    or other datasets; and</DELETED>
                    <DELETED>    (D) any other information identified by
                    the Administrator, in consultation with the Secretary
                    of Agriculture, that is necessary to meet the
                    objectives of this subtitle.</DELETED>
    <DELETED>    (j) Exclusion.--No activity for which any emission
    allowances are received under subtitle G of title III shall generate
    offset allowances under this subtitle.</DELETED>

    <DELETED>SEC. 2405. OFFSET VERIFICATION AND ISSUANCE OF ALLOWANCES FOR
                  AGRICULTURAL AND FORESTRY PROJECTS.</DELETED>

    <DELETED>    (a) In General.--Offset allowances may be claimed for net
    emission reductions or increases in sequestration annually, after
    accounting for any necessary discounts in accordance with section 2404,
    by submitting a verification report for an offset project to the
    Administrator.</DELETED>
    <DELETED>    (b) Offset Verification.--</DELETED>
            <DELETED>    (1) Scope of verification.--A verification report
            for an offset project shall--</DELETED>
                    <DELETED>    (A) be completed by a verifier accredited
                    in accordance with paragraph (3); and</DELETED>
                    <DELETED>    (B) shall be developed taking into
                    consideration--</DELETED>
                            <DELETED>    (i) the information and
                            methodology contained within a monitoring and
                            quantification plan;</DELETED>
                            <DELETED>    (ii) data and subsequent analysis
                            of the offset project, including--</DELETED>
                                    <DELETED>    (I) quantification of net
                                    emission reductions or increases in
                                    sequestration;</DELETED>
                                    <DELETED>    (II) determination of
                                    additionality;</DELETED>
                                    <DELETED>    (III) calculation of
                                    leakage;</DELETED>
                                    <DELETED>    (IV) assessment of
                                    permanence;</DELETED>
                                    <DELETED>    (V) discounting for
                                    uncertainty; and</DELETED>
                                    <DELETED>    (VI) the adjustment of net
                                    emission reductions or increases in
                                    sequestration by the discounts
                                    determined under clauses (II) through
                                    (V); and</DELETED>
                            <DELETED>    (iii) subject to the requirements
                            of this subtitle, any other information
                            identified by the Administrator as being
                            necessary to achieve the purposes of this
                            subtitle.</DELETED>
            <DELETED>    (2) Verification report requirements.--The
            Administrator shall specify the required components of a
            verification report, including--</DELETED>
                    <DELETED>    (A) the quantity of offsets
                    generated;</DELETED>
                    <DELETED>    (B) the amount of discounts
                    applied;</DELETED>
                    <DELETED>    (C) an assessment of methods (and the
                    appropriateness of those methods);</DELETED>
                    <DELETED>    (D) an assessment of quantitative errors
                    or omissions (and the effect of the errors or omissions
                    on offsets);</DELETED>
                    <DELETED>    (E) any potential conflicts of interest
                    between a verifier and project developer; and</DELETED>
                    <DELETED>    (F) any other provision that the
                    Administrator considers to be necessary to achieve the
                    purposes of this subtitle.</DELETED>
            <DELETED>    (3) Verifier accreditation.--</DELETED>
                    <DELETED>    (A) In general.--Not later than 18 months
                    after the date of enactment of this Act, the
                    Administrator shall promulgate regulations establishing
                    a process and requirements for accreditation by a
                    third-party verifier that has no conflicts of
                    interest.</DELETED>
                    <DELETED>    (B) Public accessibility.--Each verifier
                    meeting the requirements for accreditation in
                    accordance with this paragraph shall be listed in a
                    publicly-accessible database, which shall be maintained
                    and updated by the Administrator.</DELETED>
    <DELETED>    (c) Registration and Awarding of Offsets.--</DELETED>
            <DELETED>    (1) In general.--Not later than 90 days after the
            date on which the Administrator receives a complete petition
            required under section 2404(b), the Administrator shall--
            </DELETED>
                    <DELETED>    (A) determine whether the offsets satisfy
                    the applicable requirements of this subtitle;
                    and</DELETED>
                    <DELETED>    (B) notify the project developer of that
                    determination.</DELETED>
            <DELETED>    (2) Affirmative determination.--In the case of an
            affirmative determination under paragraph (1), the
            Administrator shall--</DELETED>
                    <DELETED>    (A) register the offset allowances in
                    accordance with this subtitle; and</DELETED>
                    <DELETED>    (B) issue the offset allowances.</DELETED>
            <DELETED>    (3) Appeal and review.--The Administrator shall
            establish mechanisms for the appeal and review of
            determinations made under this subsection.</DELETED>

    <DELETED>SEC. 2406. TRACKING OF REVERSALS FOR SEQUESTRATION
                  PROJECTS.</DELETED>

    <DELETED>    (a) Reversal Certification.--</DELETED>
            <DELETED>    (1) In general.--Subject to section 2402, the
            Administrator shall promulgate regulations requiring the
            submission of a reversal certification for each offset project
            on an annual basis following the registration of offset
            allowances.</DELETED>
            <DELETED>    (2) Requirements.--A reversal certification
            submitted in accordance with this subsection shall state--
            </DELETED>
                    <DELETED>    (A) whether any unmitigated reversal
                    relating to the offset project has occurred in the year
                    preceding the year in which the certification is
                    submitted; and</DELETED>
                    <DELETED>    (B) the quantity of each unmitigated
                    reversal.</DELETED>
    <DELETED>    (b) Effect on Offset Allowances.--</DELETED>
            <DELETED>    (1) Invalidity.--The Administrator shall declare
            invalid all offset allowances issued for any offset project
            that has undergone a complete reversal.</DELETED>
            <DELETED>    (2) Partial reversal.--In the case of an offset
            project that has undergone a partial reversal, the
            Administrator shall render invalid offset allowances issued for
            the offset project in direct proportion to the degree of
            reversal.</DELETED>
    <DELETED>    (c) Accountability for Reversals.--Liability and
    responsibility for compensation of a reversal of a registered offset
    allowance under subsection (a) shall lie with the person that submitted
    the offset allowance to the Administrator for the purpose of compliance
    with section 1202(a), unless otherwise specified in a legally-binding
    contract or agreement.</DELETED>
    <DELETED>    (d) Compensation for Reversals.--The unmitigated reversal
    of 1 or more registered offset allowances shall require the submission
    of--</DELETED>
            <DELETED>    (1) an equal number of offset allowances;
            or</DELETED>
            <DELETED>    (2) a combination of offset allowances and
            emission allowances equal to the unmitigated
            reversal.</DELETED>
    <DELETED>    (e) Adjustment of Baseline.--</DELETED>
            <DELETED>    (1) In general.--If the Administrator determines
            that, as a result of activities or behavior that is
            inconsistent with the purposes of this subtitle, a significant
            deviation exists between the average annual greenhouse gas flux
            or carbon stock for a given year pursuant to the certification
            submitted under subsection (a), the baseline for that project
            shall be adjusted by a quantity equal to the difference
            between--</DELETED>
                    <DELETED>    (A) the estimated greenhouse gas flux or
                    carbon stock at the end of the year prior to the year
                    in which the significant deviation occurred;
                    and</DELETED>
                    <DELETED>    (B) the estimated greenhouse gas flux or
                    carbon stock at the end of the year in which the
                    significant deviation occurred.</DELETED>
            <DELETED>    (2) Project termination.--A project developer may
            cease participation in the domestic offset program established
            under this subtitle at any time, on the condition that any
            registered allowances awarded for increases in sequestration
            have been compensated for by the project developer through the
            submission of an equal number of offset allowances.</DELETED>

    <DELETED>SEC. 2407. EXAMINATIONS.</DELETED>

    <DELETED>    (a) Regulations.--Not later than 2 years after the date of
    enactment of this Act, the Administrator shall promulgate regulations
    governing the examination and auditing of offset allowances.</DELETED>
    <DELETED>    (b) Requirements.--The regulations promulgated under this
    section shall specifically consider--</DELETED>
            <DELETED>    (1) principles for initiating and conducting
            examinations;</DELETED>
            <DELETED>    (2) the type or scope of examinations, including--
            </DELETED>
                    <DELETED>    (A) reporting and recordkeeping;
                    and</DELETED>
                    <DELETED>    (B) site review or visitation;</DELETED>
            <DELETED>    (3) the rights and privileges of an examined
            party; and</DELETED>
            <DELETED>    (4) the establishment of an appeal
            process.</DELETED>

    <DELETED>SEC. 2408. TIMING AND THE PROVISION OF OFFSET
                  ALLOWANCES.</DELETED>

    <DELETED>    (a) Initiation of Offset Projects.--An offset project that
    commences operation on or after the effective date of regulations
    promulgated under section 2407(a) shall be eligible to generate offset
    allowances under this subtitle if the offset project meets the other
    applicable requirements of this subtitle.</DELETED>
    <DELETED>    (b) Pre-Existing Projects.--</DELETED>
            <DELETED>    (1) In general.--The Administrator may allow for
            the transition into the Registry of offset projects and banked
            offset allowances operating under other Federal, State, or
            private reporting programs or registries as of the effective
            date of regulations promulgated under section 2407(a) if the
            Administrator determines that the offset projects and banked
            offset allowances satisfy the applicable requirements of this
            subtitle.</DELETED>
            <DELETED>    (2) Exception.--An offset allowance that is
            expired, retired, or canceled under any other offset program,
            registry, or market as of the effective date of regulations
            promulgated under section 2407(a) shall be ineligible for
            transition into the Registry.</DELETED>

    <DELETED>SEC. 2409. OFFSET REGISTRY.</DELETED>

    <DELETED>    In addition to the requirements established by section
    2404, an offset allowance registered under this subtitle shall be
    accompanied in the Registry by--</DELETED>
            <DELETED>    (1) a verification report submitted pursuant to
            section 2405(a);</DELETED>
            <DELETED>    (2) a reversal certification submitted pursuant to
            section 2406(b); and</DELETED>
            <DELETED>    (3) subject to the requirements of this subtitle,
            any other information identified by the Administrator as being
            necessary to achieve the purposes of this subtitle.</DELETED>

    <DELETED>SEC. 2410. ENVIRONMENTAL CONSIDERATIONS.</DELETED>

    <DELETED>    (a) Coordination to Minimize Negative Effects.--In
    promulgating regulations under this subtitle, the Administrator, in
    consultation with the Secretary of Agriculture, shall act (including by
    rejecting projects, if necessary) to avoid or minimize, to the maximum
    extent practicable, adverse effects on human health or the environment
    resulting from the implementation of offset projects under this
    subtitle.</DELETED>
    <DELETED>    (b) Report on Positive Effects.--Not later than 2 years
    after the date of enactment of this Act, the Administrator, in
    consultation with the Secretary of Agriculture, shall submit to
    Congress a report detailing--</DELETED>
            <DELETED>    (1) the incentives, programs, or policies capable
            of fostering improvements to human health or the environment in
            conjunction with the implementation of offset projects under
            this subtitle; and</DELETED>
            <DELETED>    (2) the cost of those incentives, programs, or
            policies.</DELETED>
    <DELETED>    (c) Use of Native Plant Species in Offset Projects.--Not
    later than 18 months after the date of enactment of this Act, the
    Administrator, in consultation with the Secretary of Agriculture, shall
    promulgate regulations for the selection, use, and storage of native
    and nonnative plant materials--</DELETED>
            <DELETED>    (1) to ensure native plant materials are given
            primary consideration, in accordance with applicable Department
            of Agriculture guidance for use of native plant
            materials;</DELETED>
            <DELETED>    (2) to prohibit the use of Federal- or State-
            designated noxious weeds; and</DELETED>
            <DELETED>    (3) to prohibit the use of a species listed by a
            regional or State invasive plant council within the applicable
            region or State.</DELETED>

    <DELETED>SEC. 2411. PROGRAM REVIEW.</DELETED>

    <DELETED>    Not later than 5 years after the date of enactment of this
    Act, and periodically thereafter, the Administrator shall review and
    revise, as necessary, the regulations promulgated under this
    subtitle.</DELETED>

              <DELETED>Subtitle E--International Credits</DELETED>

    <DELETED>SEC. 2501. USE OF INTERNATIONAL ALLOWANCES OR
                  CREDITS.</DELETED>

    <DELETED>    The owner or operator of a covered facility may satisfy up
    to 15 percent of the allowance submission requirement of the covered
    facility under section 1202(a) by submitting allowances or credits
    obtained on a foreign greenhouse gas emissions trading market, on the
    condition that the Administrator has certified the market in accordance
    with the regulations promulgated pursuant to section 2502(a).</DELETED>

    <DELETED>SEC. 2502. REGULATIONS.</DELETED>

    <DELETED>    (a) In General.--Not later than 2 years after the date of
    enactment of this Act, the Administrator shall promulgate regulations,
    taking into consideration protocols adopted in accordance with the
    United Nations Framework Convention on Climate Change, done at New York
    on May 9, 1992--</DELETED>
            <DELETED>    (1) approving the use under this subtitle of
            credits from such foreign greenhouse gas emissions trading
            markets as the regulations may establish; and</DELETED>
            <DELETED>    (2) permitting the use of international credits
            from the foreign country that issued the credits.</DELETED>
    <DELETED>    (b) Requirements.--The regulations promulgated under
    subsection (a) shall require that, in order to be approved for use
    under this subtitle--</DELETED>
            <DELETED>    (1) a credit shall have been issued by a foreign
            country pursuant to a governmental program that imposes
            mandatory absolute tonnage limits on greenhouse gas emissions
            from the foreign country, or 1 or more industry sectors in that
            country, pursuant to protocols described in subsection (a);
            and</DELETED>
            <DELETED>    (2) the governmental program be of comparable
            stringency to the program established by this Act, including
            comparable monitoring, compliance, and enforcement.</DELETED>

    <DELETED>SEC. 2503. FACILITY CERTIFICATION.</DELETED>

    <DELETED>    The owner or operator of a covered facility who submits an
    international allowance or credit under this subtitle shall certify
    that the allowance or credit has not been retired from use in the
    registry of the applicable foreign country.</DELETED>

         <DELETED>Subtitle F--Carbon Market Efficiency Board</DELETED>

    <DELETED>SEC. 2601. PURPOSES.</DELETED>

    <DELETED>    The purposes of this subtitle are--</DELETED>
            <DELETED>    (1) to ensure that the imposition of limits on
            greenhouse gas emissions will not significantly harm the
            economy of the United States; and</DELETED>
            <DELETED>    (2) to establish a Carbon Market Efficiency Board
            to ensure the implementation and maintenance of a stable,
            functioning, and efficient market in emission
            allowances.</DELETED>

    <DELETED>SEC. 2602. ESTABLISHMENT OF CARBON MARKET EFFICIENCY
                  BOARD.</DELETED>

    <DELETED>    (a) Establishment.--There is established a board, to be
    known as the ``Carbon Market Efficiency Board'' (referred to in this
    subtitle as the ``Board'').</DELETED>
    <DELETED>    (b) Purposes.--The purposes of the Board are--</DELETED>
            <DELETED>    (1) to promote the achievement of the purposes of
            this Act;</DELETED>
            <DELETED>    (2) to observe the national greenhouse gas
            emission market and evaluate periods during which the cost of
            emission allowances provided under Federal law might pose
            significant harm to the economy; and</DELETED>
            <DELETED>    (3) to submit to the President and Congress
            quarterly reports--</DELETED>
                    <DELETED>    (A) describing--</DELETED>
                            <DELETED>    (i) the status of the emission
                            allowance market established under this
                            Act;</DELETED>
                            <DELETED>    (ii) the economic effects of the
                            market, regional, industrial, and consumer
                            responses to the market;</DELETED>
                            <DELETED>    (iii) where practicable, energy
                            investment responses to the market;</DELETED>
                            <DELETED>    (iv) any corrective measures that
                            should be carried out to relieve excessive
                            costs of the market; and</DELETED>
                            <DELETED>    (v) plans to compensate for those
                            measures to ensure that the long-term emission-
                            reduction goals of this Act are
                            achieved;</DELETED>
                    <DELETED>    (B) that are timely and succinct to ensure
                    regular monitoring of market trends; and</DELETED>
                    <DELETED>    (C) that are prepared independently by the
                    Board.</DELETED>
    <DELETED>    (c) Membership.--</DELETED>
            <DELETED>    (1) Composition.--The Board shall be composed of 7
            members who are citizens of the United States, to be appointed
            by the President, by and with the advice and consent of the
            Senate.</DELETED>
            <DELETED>    (2) Requirements.--In appointing members of the
            Board under paragraph (1), the President shall--</DELETED>
                    <DELETED>    (A) ensure fair representation of the
                    financial, agricultural, industrial, and commercial
                    sectors, and the geographical regions, of the United
                    States, and include a representative of consumer
                    interests; and</DELETED>
                    <DELETED>    (B) appoint not more than 1 member from
                    each such geographical region.</DELETED>
            <DELETED>    (3) Compensation.--</DELETED>
                    <DELETED>    (A) In general.--A member of the Board
                    shall be compensated at a rate equal to the daily
                    equivalent of the annual rate of basic pay prescribed
                    for level II of the Executive Schedule under section
                    5313 of title 5, United States Code, for each day
                    (including travel time) during which the member is
                    engaged in the performance of the duties of the
                    Board.</DELETED>
                    <DELETED>    (B) Chairperson.--The Chairperson of the
                    Board shall be compensated at a rate equal to the daily
                    equivalent of the annual rate of basic pay prescribed
                    for level I of the Executive Schedule under section
                    5312 of title 5, United States Code, for each day
                    (including travel time) during which the member is
                    engaged in the performance of the duties of the
                    Board.</DELETED>
            <DELETED>    (4) Prohibitions.--</DELETED>
                    <DELETED>    (A) Conflicts of interest.--An individual
                    employed by, or holding any official relationship
                    (including any shareholder) with, any entity engaged in
                    the generation, transmission, distribution, or sale of
                    energy, an individual who has any pecuniary interest in
                    the generation, transmission, distribution, or sale of
                    energy, or an individual who has a pecuniary interest
                    in the implementation of this Act, shall not be
                    appointed to the Board under this subsection.</DELETED>
                    <DELETED>    (B) No other employment.--A member of the
                    Board shall not hold any other employment during the
                    term of service of the member.</DELETED>
    <DELETED>    (d) Term; Vacancies.--</DELETED>
            <DELETED>    (1) Term.--</DELETED>
                    <DELETED>    (A) In general.--The term of a member of
                    the Board shall be 14 years, except that the members
                    first appointed to the Board shall be appointed for
                    terms in a manner that ensures that--</DELETED>
                            <DELETED>    (i) the term of not more than 1
                            member shall expire during any 2-year period;
                            and</DELETED>
                            <DELETED>    (ii) no member serves a term of
                            more than 14 years.</DELETED>
                    <DELETED>    (B) Oath of office.--A member shall take
                    the oath of office of the Board by not later than 15
                    days after the date on which the member is appointed
                    under subsection (c)(1).</DELETED>
                    <DELETED>    (C) Removal.--</DELETED>
                            <DELETED>    (i) In general.--A member may be
                            removed from the Board on determination of the
                            President for cause.</DELETED>
                            <DELETED>    (ii) Notification.--The President
                            shall submit to Congress a notification of any
                            determination by the President to remove a
                            member of the Board for cause under clause
                            (i).</DELETED>
            <DELETED>    (2) Vacancies.--</DELETED>
                    <DELETED>    (A) In general.--A vacancy on the Board--
                    </DELETED>
                            <DELETED>    (i) shall not affect the powers of
                            the Board; and</DELETED>
                            <DELETED>    (ii) shall be filled in the same
                            manner as the original appointment was
                            made.</DELETED>
                    <DELETED>    (B) Service until new appointment.--A
                    member of the Board the term of whom has expired or
                    otherwise been terminated shall continue to serve until
                    the date on which a replacement is appointed under
                    subparagraph (A)(ii), if the President determines that
                    service to be appropriate.</DELETED>
    <DELETED>    (e) Chairperson and Vice-Chairperson.--Of members of the
    Board, the President shall appoint--</DELETED>
            <DELETED>    (1) 1 member to serve as Chairperson of the Board
            for a term of 4 years; and</DELETED>
            <DELETED>    (2) 1 member to serve as Vice-Chairperson of the
            Board for a term of 4 years.</DELETED>
    <DELETED>    (f) Meetings.--</DELETED>
            <DELETED>    (1) Initial meeting.--The Board shall hold the
            initial meeting of the Board as soon as practicable after the
            date on which all members have been appointed to the Board
            under subsection (c)(1).</DELETED>
            <DELETED>    (2) Presiding officer.--A meeting of the Board
            shall be presided over by--</DELETED>
                    <DELETED>    (A) the Chairperson;</DELETED>
                    <DELETED>    (B) in any case in which the Chairperson
                    is absent, the Vice-Chairperson; or</DELETED>
                    <DELETED>    (C) in any case in which the Chairperson
                    and Vice-Chairperson are absent, a chairperson pro
                    tempore, to be elected by the members of the
                    Board.</DELETED>
            <DELETED>    (3) Quorum.--Four members of the Board shall
            constitute a quorum for a meeting of the Board.</DELETED>
            <DELETED>    (4) Open meetings.--The Board shall be subject to
            section 552b of title 5, United States Code (commonly known as
            the ``Government in the Sunshine Act'').</DELETED>

    <DELETED>SEC. 2603. DUTIES.</DELETED>

    <DELETED>    (a) Information Gathering.--</DELETED>
            <DELETED>    (1) Authority.--The Board shall collect and
            analyze relevant market information to promote a full
            understanding of the dynamics of the emission allowance market
            established under this Act.</DELETED>
            <DELETED>    (2) Information.--The Board shall gather such
            information as the Board determines to be appropriate regarding
            the status of the market, including information relating to--
            </DELETED>
                    <DELETED>    (A) emission allowance allocation and
                    availability;</DELETED>
                    <DELETED>    (B) the price of emission
                    allowances;</DELETED>
                    <DELETED>    (C) macro- and micro-economic effects of
                    unexpected significant increases in emission allowance
                    prices, or shifts in the emission allowance market,
                    should those increases or shifts occur;</DELETED>
                    <DELETED>    (D) economic effect thresholds that could
                    warrant implementation of cost relief measures
                    described in section 2604(a) after the initial 2-year
                    period described in section 2603(d)(2);</DELETED>
                    <DELETED>    (E) in the event any cost relief measures
                    described in section 2604(a) are taken, the effects of
                    those measures on the market;</DELETED>
                    <DELETED>    (F) maximum levels of cost relief measures
                    that are necessary to achieve avoidance of economic
                    harm and preserve achievement of the purposes of this
                    Act; and</DELETED>
                    <DELETED>    (G) the success of the market in promoting
                    achievement of the purposes of this Act.</DELETED>
    <DELETED>    (b) Treatment as Primary Activity.--</DELETED>
            <DELETED>    (1) In general.--During the initial 2-year period
            of operation of the Board, information gathering under
            subsection (a) shall be the primary activity of the
            Board.</DELETED>
            <DELETED>    (2) Subsequent authority.--After the 2-year period
            described in paragraph (1), the Board shall assume authority to
            implement the cost-relief measures described in section
            2604(a).</DELETED>
    <DELETED>    (c) Study.--</DELETED>
            <DELETED>    (1) In general.--During the 2-year period
            beginning on the date on which the emission allowance market
            established under this Act begins operation, the Board shall
            conduct a study of other markets for tradeable permits to emit
            covered greenhouse gases.</DELETED>
            <DELETED>    (2) Report.--Not later than 180 days after the
            beginning of the period described in paragraph (1), the Board
            shall submit to Congress a report describing the status of the
            market, specifically with respect to volatility within the
            market and the average price of emission allowances during that
            180-day period.</DELETED>
    <DELETED>    (d) Employment of Cost Relief Measures.--</DELETED>
            <DELETED>    (1) In general.--If the Board determines that the
            emission allowance market established under this Act poses a
            significant harm to the economy of the United States, the Board
            shall carry out such cost relief measures relating to that
            market as the Board determines to be appropriate under section
            2604(a).</DELETED>
            <DELETED>    (2) Initial period.--During the 2-year period
            beginning on the date on which the emission allowance market
            established under this Act begins operation, if the Board
            determines that the average daily closing price of emission
            allowances during a 180-day period exceeds the upper range of
            the estimate provided under section 2605, the Board shall--
            </DELETED>
                    <DELETED>    (A) increase the quantity of emission
                    allowances that covered facilities may borrow from the
                    prescribed allocations of the covered facilities for
                    future years; and</DELETED>
                    <DELETED>    (B) take subsequent action as described in
                    section 2604(a)(2).</DELETED>
            <DELETED>    (3) Requirements.--Any action carried out pursuant
            to this subsection shall be subject to the requirements of
            section 2604(a)(3)(B).</DELETED>
    <DELETED>    (e) Reports.--The Board shall submit to the President and
    Congress quarterly reports--</DELETED>
            <DELETED>    (1) describing the status of the emission
            allowance market established under this Act, the economic
            effects of the market, regional, industrial, and consumer
            responses to the market, energy investment responses to the
            market, any corrective measures that should be carried out to
            relieve excessive costs of the market, and plans to compensate
            for those measures; and</DELETED>
            <DELETED>    (2) that are prepared independently by the Board,
            and not in partnership with Federal agencies.</DELETED>

    <DELETED>SEC. 2604. POWERS.</DELETED>

    <DELETED>    (a) Cost Relief Measures.--</DELETED>
            <DELETED>    (1) In general.--Beginning on the day after the
            date of expiration of the 2-year period described in section
            2603(b), the Board may carry out 1 or more of the following
            cost relief measures to ensure functioning, stable, and
            efficient markets for emission allowances:</DELETED>
                    <DELETED>    (A) Increase the quantity of emission
                    allowances that covered facilities may borrow from the
                    prescribed allocations of the covered facilities for
                    future years.</DELETED>
                    <DELETED>    (B) Expand the period during which a
                    covered facility may repay the Administrator for an
                    emission allowance as described in subparagraph
                    (A).</DELETED>
                    <DELETED>    (C) Lower the interest rate at which an
                    emission allowance may be borrowed as described in
                    subparagraph (A).</DELETED>
                    <DELETED>    (D) Increase the quantity of allowances or
                    credits obtained on a foreign greenhouse gas emissions
                    trading market that the owner or operator of any
                    covered facility may use to satisfy the allowance
                    submission requirement of the covered facility under
                    section 1202(a), on the condition that the
                    Administrator has certified the market in accordance
                    with the regulations promulgated pursuant to section
                    2502(a).</DELETED>
                    <DELETED>    (E) Increase the quantity of offset
                    allowances generated in accordance with subtitle D that
                    the owner or operator of any covered facility may use
                    to satisfy the total allowance submission requirement
                    of the covered facility under section
                    1202(a).</DELETED>
                    <DELETED>    (F) Expand the total quantity of emission
                    allowances made available to all covered facilities at
                    any given time by borrowing against the total allowable
                    quantity of emission allowances to be provided for
                    future years.</DELETED>
            <DELETED>    (2) Subsequent actions.--On determination by the
            Board to carry out a cost relief measure pursuant to paragraph
            (1), the Board shall--</DELETED>
                    <DELETED>    (A) allow the cost relief measure to be
                    used only during the applicable allocation
                    year;</DELETED>
                    <DELETED>    (B) exercise the cost relief measure
                    incrementally, and only as needed to avoid significant
                    economic harm during the applicable allocation
                    year;</DELETED>
                    <DELETED>    (C) specify the terms of the relief to be
                    achieved using the cost relief measure, including
                    requirements for entity-level or national market-level
                    compensation to be achieved by a specific date or
                    within a specific time period;</DELETED>
                    <DELETED>    (D) in accordance with section 2603(e),
                    submit to the President and Congress a report
                    describing the actions carried out by the Board and
                    recommendations for the terms under which the cost
                    relief measure should be authorized by Congress and
                    carried out by Federal entities; and</DELETED>
                    <DELETED>    (E) evaluate, at the end of the applicable
                    allocation year, actions that need to be carried out
                    during subsequent years to compensate for any cost
                    relief measure carried out during the applicable
                    allocation year.</DELETED>
            <DELETED>    (3) Action on expansion of borrowing.--</DELETED>
                    <DELETED>    (A) In general.--If the Board carries out
                    a cost relief measure pursuant to paragraph (1) that
                    results in the expansion of borrowing of emission
                    allowances under this Act, and if the average daily
                    closing price of emission allowances for the 180-day
                    period beginning on the date on which borrowing is so
                    expanded exceeds the upper range of the estimate
                    provided under section 2605, the Board shall increase
                    the quantity of emission allowances available for the
                    applicable allocation year in accordance with this
                    paragraph.</DELETED>
                    <DELETED>    (B) Requirements.--An increase in the
                    quantity of emission allowances under subparagraph (A)
                    shall--</DELETED>
                            <DELETED>    (i) apply to all covered
                            facilities;</DELETED>
                            <DELETED>    (ii) be allocated in accordance
                            with the applicable formulas and procedures
                            established under this Act;</DELETED>
                            <DELETED>    (iii) be equal to not more than 5
                            percent of the total quantity of emission
                            allowances otherwise available for the
                            applicable allocation year under this
                            Act;</DELETED>
                            <DELETED>    (iv) remain in effect only for the
                            applicable allocation year;</DELETED>
                            <DELETED>    (v) specify the date by which the
                            increase shall be repaid by covered facilities
                            through a proportionate reduction of emission
                            allowances available for subsequent allocation
                            years; and</DELETED>
                            <DELETED>    (vi) require the repayment under
                            clause (v) to be made by not later than the
                            date that is 15 years after the date on which
                            the increase is provided.</DELETED>
    <DELETED>    (b) Assessments.--Not more frequently than semiannually,
    the Board may levy on owners and operators of covered facilities, in
    proportion to the capital stock and surplus of the participants, an
    assessment sufficient to pay the estimated expenses of the Board and
    the salaries of members of and employees of the Board during the 180-
    day period beginning on the date on which the assessment is levied,
    taking into account any deficit carried forward from the preceding 180-
    day period.</DELETED>
    <DELETED>    (c) Limitations.--Nothing in this section gives the Board
    the authority--</DELETED>
            <DELETED>    (1) to consider or prescribe entity-level
            petitions for relief from the costs of an emission allowance
            allocation or trading program established under Federal
            law;</DELETED>
            <DELETED>    (2) to carry out any investigative or punitive
            process under the jurisdiction of any Federal or State
            court;</DELETED>
            <DELETED>    (3) to interfere with, modify, or adjust any
            emission allowance allocation scheme established under Federal
            law; or</DELETED>
            <DELETED>    (4) to modify the total quantity of allowances
            issued under this Act for the period of calendar years 2012
            through 2050.</DELETED>

    <DELETED>SEC. 2605. ESTIMATE OF COSTS TO ECONOMY OF LIMITING GREENHOUSE
                  GAS EMISSIONS.</DELETED>

    <DELETED>    Not later than July 1, 2014, the Director of the
    Congressional Budget Office, using economic and scientific analyses,
    shall submit to Congress a report that describes--</DELETED>
            <DELETED>    (1) the projected price range at which emission
            allowances are expected to trade during the 2-year period of
            the initial greenhouse gas emission market established under
            Federal law; and</DELETED>
            <DELETED>    (2) the projected impact of that market on the
            economy of the United States.</DELETED>

      <DELETED>TITLE III--ALLOCATING AND DISTRIBUTING ALLOWANCES</DELETED>

                 <DELETED>Subtitle A--Early Auctions</DELETED>

    <DELETED>SEC. 3101. ALLOCATION FOR EARLY AUCTIONS.</DELETED>

    <DELETED>    Not later than 180 days after the date of enactment of
    this Act, the Administrator shall allocate 6 percent of the emission
    allowances established for calendar year 2012, 4 percent of the
    emission allowances established for calendar year 2013, and 2 percent
    of the emissions established for calendar 2014, to the Corporation for
    early auctioning in accordance with section 4301.</DELETED>

                 <DELETED>Subtitle B--Annual Auctions</DELETED>

    <DELETED>SEC. 3201. ALLOCATION FOR ANNUAL AUCTIONS.</DELETED>

    <DELETED>    Not later than January 1, 2012, and annually thereafter
    through January 1, 2050, the Administrator shall allocate to the
    Corporation a percentage of emission allowances for that calendar year,
    for annual auctioning, as follows:</DELETED>

    ----------------------------------------------------------------------------------------------------------------
                                                                                   Percentage of Emission Allowance
                                   Calendar Year                                       Account Allocated to the
                                                                                             Corporation
    ----------------------------------------------------------------------------------------------------------------
    2012                                                                                                         18
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2013                                                                                                         21
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    2014                                                                                                         24
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    2015                                                                                                         27
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    2016                                                                                                         28
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    2017                                                                                                         31
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2018                                                                                                         33
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    2019                                                                                                         35
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    2020                                                                                                         37
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    2021                                                                                                         39
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    2022                                                                                                         41
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    2023                                                                                                         43
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    2024                                                                                                         45
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    2025                                                                                                         47
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    2026                                                                                                         49
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    2027                                                                                                         51
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    2028                                                                                                         53
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    2029                                                                                                         55
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    2030                                                                                                         57
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    2031                                                                                                         59
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    2032                                                                                                         61
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    2033                                                                                                         63
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    2034                                                                                                         65
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2035                                                                                                         67
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    2036                                                                                                         73
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2037                                                                                                         73
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2038                                                                                                         73
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    2039                                                                                                         73
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2040                                                                                                         73
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2041                                                                                                         73
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2042                                                                                                         73
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2043                                                                                                         73
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2044                                                                                                         73
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2045                                                                                                         73
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2046                                                                                                         73
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2047                                                                                                         73
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2048                                                                                                         73
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    2049                                                                                                         73
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    2050                                                                                                         73
    ----------------------------------------------------------------------------------------------------------------

                  <DELETED>Subtitle C--Early Action</DELETED>

    <DELETED>SEC. 3301. ALLOCATION.</DELETED>

    <DELETED>    Not later than 2 years after the date of enactment of this
    Act, the Administrator shall allocate to owners or operators of covered
    facilities, in recognition of actions of the owners and operators taken
    since January 1, 1994, that resulted in verified and credible
    reductions of greenhouse gas emissions--</DELETED>
            <DELETED>    (1) 5 percent of the emission allowances
            established for calendar year 2012;</DELETED>
            <DELETED>    (2) 4 percent of the emission allowances
            established for calendar year 2013;</DELETED>
            <DELETED>    (3) 3 percent of the emission allowances
            established for calendar year 2014;</DELETED>
            <DELETED>    (4) 2 percent of the emission allowances
            established for calendar year 2015; and</DELETED>
            <DELETED>    (5) 1 percent of the emission allowances
            established for calendar year 2016.</DELETED>

    <DELETED>SEC. 3302. DISTRIBUTION.</DELETED>

    <DELETED>    (a) In General.--Not later than 1 year after the date of
    enactment of this Act, the Administrator shall establish, by
    regulation, procedures and standards for use in distributing, to owners
    and operators of covered facilities, emission allowances allocated
    under section 3301.</DELETED>
    <DELETED>    (b) Consideration.--The procedures and standards
    established under subsection (a) shall provide for consideration of
    verified and credible emission reductions registered before the date of
    enactment of this Act under--</DELETED>
            <DELETED>    (1) the Climate Leaders Program, or any other
            voluntary greenhouse gas reduction program of the United States
            Environmental Protection Agency and United States Department of
            Energy;</DELETED>
            <DELETED>    (2) the Voluntary Reporting of Greenhouse Gases
            Program of the Energy Information Administration;</DELETED>
            <DELETED>    (3) State or regional greenhouse gas emission
            reduction programs that include systems for tracking and
            verifying the greenhouse gas emission reductions; and</DELETED>
            <DELETED>    (4) voluntary entity programs that resulted in
            entity-wide reductions in greenhouse gas emissions.</DELETED>
    <DELETED>    (c) Distribution.--Not later than 4 years after the date
    of enactment of this Act, the Administrator shall distribute all
    emission allowances allocated under section 3301.</DELETED>

                     <DELETED>Subtitle D--States</DELETED>

    <DELETED>SEC. 3401. ALLOCATION FOR ENERGY SAVINGS.</DELETED>

    <DELETED>    (a) Allocation.--Not later than January 1, 2012, and
    annually thereafter through January 1, 2050, the Administrator shall
    allocate 1 percent of the Emission Allowance Account among States
    that--</DELETED>
            <DELETED>    (1) have adopted regulations by not later than the
            date on which the allowance allocations are made, that subject
            regulated natural gas and electric utilities that deliver gas
            or electricity in the State to regulations that--</DELETED>
                    <DELETED>    (A) automatically adjust the rates charged
                    by natural gas and electric utilities to fully recover
                    fixed costs of service without regard to whether their
                    actual sales are higher or lower than the forecast of
                    sales on which the tariffed rates were based;
                    and</DELETED>
                    <DELETED>    (B) make cost-effective energy-efficiency
                    investments by investor-owned natural gas or electric
                    utilities at least as rewarding to their shareholders,
                    on a risk-adjusted basis for the equity capital
                    invested, as power or energy purchases, or investments
                    in new energy supplies or infrastructure; and</DELETED>
            <DELETED>    (2) have adopted, or whose political subdivisions
            have adopted, regulations by not later than the date on which
            allocations are made, that are as stringent as, or more
            stringent than, the most recent energy performance requirements
            of ASHRAE 90.1 and the International Energy Conservation Code
            for new buildings.</DELETED>
    <DELETED>    (b) Allocation for Building Efficiency.--Not later than
    January 1, 2012, and annually thereafter through January 1, 2050, the
    Administrator shall allocate 1 percent of the Emission Allowance
    Account among States that are in compliance with section 304(c)(3) of
    the Energy Conservation and Production Act (as amended by section
    5201).</DELETED>
    <DELETED>    (c) Distribution.--Not later than 2 years after the date
    of enactment of this Act, the Administrator shall establish procedures
    and standards for the distribution of emission allowances to States in
    accordance with subsections (a) and (b).</DELETED>
    <DELETED>    (d) Use.--Any State receiving emission allowances under
    this section for a calendar year shall retire or use, in 1 or more of
    the ways described in section 3403(c)(1), not less than 90 percent of
    the emission allowances allocated to the State (or proceeds of the sale
    of those allowances) under this section for the calendar
    year.</DELETED>

    <DELETED>SEC. 3402. ALLOCATION FOR STATES WITH PROGRAMS THAT EXCEED
                  FEDERAL EMISSION REDUCTION TARGETS.</DELETED>

    <DELETED>    (a) Allocation.--Not later than January 1, 2012, and
    annually thereafter through January 1, 2050, the Administrator shall
    allocate 2 percent of the Emission Allowance Account for the year among
    States that have--</DELETED>
            <DELETED>    (1) before the date of enactment of this Act,
            enacted statewide greenhouse gas emission reduction targets
            that are more stringent than the nationwide targets established
            under title II; and</DELETED>
            <DELETED>    (2) by the time of an allocation under this
            subsection, imposed on covered facilities within the States
            aggregate greenhouse gas emission limitations more stringent
            than those imposed on covered facilities under title
            II.</DELETED>
    <DELETED>    (b) Distribution.--Not later than 2 years after the date
    of enactment of this Act, the Administrator shall establish procedures
    and standards for use in distributing emission allowances among States
    in accordance with subsection (a).</DELETED>
    <DELETED>    (c) Use.--Any State receiving emission allowances under
    this section for a calendar year shall retire or use, in 1 or more of
    the ways described in section 3403(c)(1), not less than 90 percent of
    the emission allowances allocated to the State (or proceeds of the sale
    of those allowances) under this section for the calendar
    year.</DELETED>

    <DELETED>SEC. 3403. GENERAL ALLOCATION.</DELETED>

    <DELETED>    (a) Allocation.--Subject to subsection (d)(3), not later
    than January 1, 2012, and annually thereafter through January 1, 2050,
    the Administrator shall allocate 5 percent of the Emission Allowance
    Account for the year among States.</DELETED>
    <DELETED>    (b) Distribution.--The allowances available for allocation
    to States under subsection (a) for a calendar year shall be distributed
    as follows:</DELETED>
            <DELETED>    (1) For each calendar year, </DELETED>\<DELETED>1/
            3</DELETED>\ <DELETED>of the quantity of allowances available
            for allocation to States under subsection (a) shall be
            allocated among individual States based on the proportion
            that--</DELETED>
                    <DELETED>    (A) the expenditures of a State for the
                    low-income home energy assistance program established
                    under the Low-Income Home Energy Assistance Act of 1981
                    (42 U.S.C. 8621 et seq.) for the preceding calendar
                    year; bears to</DELETED>
                    <DELETED>    (B) the expenditures of all States for
                    that program for the preceding calendar year.</DELETED>
            <DELETED>    (2) For each calendar year, </DELETED>\<DELETED>1/
            3</DELETED>\ <DELETED>of the quantity of allowances available
            for allocation to States under subsection (a) shall be
            allocated among the States based on the proportion that--
            </DELETED>
                    <DELETED>    (A) the population of a State, as
                    determined by the most recent decennial census
                    preceding the calendar year for which the allocation
                    regulations are for the allocation year; bears
                    to</DELETED>
                    <DELETED>    (B) the population of all States, as
                    determined by that census.</DELETED>
            <DELETED>    (3) For each calendar year, </DELETED>\<DELETED>1/
            3</DELETED>\ <DELETED>of the quantity of allowances available
            for allocation to States under subsection (a) shall be
            allocated among the States based on the proportion that--
            </DELETED>
                    <DELETED>    (A) the quantity of carbon dioxide that
                    would be emitted assuming that all of the coal that is
                    mined, natural gas that is processed, and petroleum
                    that is refined within the boundaries of a State during
                    the preceding year is completely combusted and that
                    none of the carbon dioxide emissions are captured, as
                    determined by the Secretary of Energy; bears
                    to</DELETED>
                    <DELETED>    (B) the aggregate quantity of carbon
                    dioxide that would be emitted assuming that all of the
                    coal that is mined, natural gas that is processed, and
                    petroleum that is refined in all States for the
                    preceding year is completely combusted and that none of
                    the carbon dioxide emissions are captured, as
                    determined by the Secretary of Energy.</DELETED>
    <DELETED>    (c) Use.--</DELETED>
            <DELETED>    (1) In general.--During any calendar year, a State
            shall retire or use in 1 or more of the following ways not less
            than 90 percent of the allowances allocated to the State (or
            proceeds of sale of those emission allowances) under this
            section for that calendar year:</DELETED>
                    <DELETED>    (A) To mitigate impacts on low-income
                    energy consumers.</DELETED>
                    <DELETED>    (B) To promote energy efficiency
                    (including support of electricity and natural gas
                    demand reduction, waste minimization, and recycling
                    programs).</DELETED>
                    <DELETED>    (C) To promote investment in nonemitting
                    electricity generation technology.</DELETED>
                    <DELETED>    (D) To improve public transportation and
                    passenger rail service and otherwise promote reductions
                    in vehicle miles traveled.</DELETED>
                    <DELETED>    (E) To encourage advances in energy
                    technology that reduce or sequester greenhouse gas
                    emissions.</DELETED>
                    <DELETED>    (F) To address local or regional impacts
                    of climate change, including the relocation of
                    communities displaced by the impacts of climate
                    change.</DELETED>
                    <DELETED>    (G) To mitigate obstacles to investment by
                    new entrants in electricity generation markets and
                    energy-intensive manufacturing sectors.</DELETED>
                    <DELETED>    (H) To address local or regional impacts
                    of climate change policy, including providing
                    assistance to displaced workers.</DELETED>
                    <DELETED>    (I) To mitigate impacts on energy-
                    intensive industries in internationally competitive
                    markets.</DELETED>
                    <DELETED>    (J) To reduce hazardous fuels, and to
                    prevent and suppress wildland fire.</DELETED>
                    <DELETED>    (K) To fund rural, municipal, and
                    agricultural water projects that are consistent with
                    the sustainable use of water resources.</DELETED>
            <DELETED>    (2) Deadline.--A State shall distribute or sell
            allowances for use in accordance with paragraph (1) by not
            later than 1 year before the beginning of each allowance
            allocation year.</DELETED>
            <DELETED>    (3) Return of allowances.--Not later than 330 days
            before the beginning of each allowance allocation year, a State
            shall return to the Administrator any allowances not
            distributed by the deadline under paragraph (2).</DELETED>
    <DELETED>    (d) Program for Tribal Communities.--</DELETED>
            <DELETED>    (1) Establishment.--Not later than 3 years after
            the date of enactment of this Act, the Administrator, in
            consultation with the Secretary of the Interior, shall by
            regulation establish a program for tribal communities--
            </DELETED>
                    <DELETED>    (A) that is designed to deliver assistance
                    to tribal communities within the United States that
                    face disruption or dislocation as a result of global
                    climate change; and</DELETED>
                    <DELETED>    (B) under which the Administrator shall
                    distribute 0.5 percent of the Emission Allowance
                    Account for each calendar among tribal governments of
                    the tribal communities described in subparagraph
                    (A).</DELETED>
            <DELETED>    (2) Allocation.--Beginning in the first calendar
            year that begins after promulgation of the regulations referred
            to in paragraph (1), and annually thereafter until calendar
            year 2050, the Administrator shall allocate 0.5 percent of the
            Emission Allowance Account for each calendar year to the
            program established under paragraph (1).</DELETED>
            <DELETED>    (3) Allocations to states.--For each calendar year
            for which the Administrator allocates 0.5 percent of the
            Emission Allowance Account to the program established under
            paragraph (1), the general allocation for States under
            subsection (a) shall be 4.5 percent of the Emission Allowance
            Account.</DELETED>

              <DELETED>Subtitle E--Electricity Consumers</DELETED>

    <DELETED>SEC. 3501. ALLOCATION.</DELETED>

    <DELETED>    Not later than April 1, 2012, and annually thereafter
    through January 1, 2050, the Administrator shall allocate among load-
    serving entities 10 percent of the Emission Allowance Account for the
    year.</DELETED>

    <DELETED>SEC. 3502. DISTRIBUTION.</DELETED>

    <DELETED>    (a) In General.--For each calendar year, the emission
    allowances allocated under section 3501 shall be distributed by the
    Administrator to each load-serving entity based on the proportion
    that--</DELETED>
            <DELETED>    (1) the quantity of electricity delivered by the
            load-serving entity during the 3 calendar years preceding the
            calendar year for which the emission allowances are
            distributed, adjusted upward for electricity not delivered as a
            result of consumer energy-efficiency programs implemented by
            the load-serving entity and verified by the regulatory agency
            of the load-serving entity; bears to</DELETED>
            <DELETED>    (2) the total quantity of electricity delivered by
            all load-serving entities during those 3 calendar
            years.</DELETED>
    <DELETED>    (b) Basis.--The Administrator shall base the determination
    of the quantity of electricity delivered by a load-serving entity for
    the purpose of subsection (a) on the most recent data available in
    annual reports filed with the Energy Information Administration of the
    Department of Energy</DELETED>

    <DELETED>SEC. 3503. USE.</DELETED>

    <DELETED>    (a) In General.--Any load-serving entity that accepts
    emission allowances distributed under section 3502 shall--</DELETED>
            <DELETED>    (1) sell each emission allowance distributed to
            the load-serving entity by not later than 1 year after
            receiving the emission allowance; and</DELETED>
            <DELETED>    (2) pursue fair market value for each emission
            allowance sold in accordance with paragraph (1).</DELETED>
    <DELETED>    (b) Proceeds.--All proceeds from the sale of emission
    allowances under subsection (a) shall be used solely--</DELETED>
            <DELETED>    (1) to mitigate economic impacts on low- and
            middle-income energy consumers, including by reducing
            transmission charges or issuing rebates; and</DELETED>
            <DELETED>    (2) to promote energy efficiency on the part of
            energy consumers.</DELETED>
    <DELETED>    (c) Inclusion in Retail Rates.--To facilitate the prompt
    pass-through of the benefits from the sale of emission allowances to
    retail customers--</DELETED>
            <DELETED>    (1) any credit from the sale of allowances shall
            be reflected in the retail rates of a load-serving entity not
            later than 90 days after the sale of the allowances;</DELETED>
            <DELETED>    (2) the load-serving entity shall not be required
            to file a retail rate case in order to pass through the credit;
            and</DELETED>
            <DELETED>    (3) the amount of the credit shall not be subject
            to review by any State regulatory authority.</DELETED>
    <DELETED>    (d) Prohibition on Rebates.--No load-serving entity may
    use any proceeds from the sale of emission allowances under subsection
    (a) to provide to any consumer a rebate that is based on the quantity
    of electricity used by the consumer.</DELETED>

    <DELETED>SEC. 3504. REPORTING.</DELETED>

    <DELETED>    (a) In General.--Each load-serving entity that accepts
    emission allowances distributed under section 3502 shall, for each
    calendar year for which the load-serving entity accepts emission
    allowances, submit to the Administrator a report describing--</DELETED>
            <DELETED>    (1) the date of each sale of each emission
            allowance during the preceding year;</DELETED>
            <DELETED>    (2) the amount of revenue generated from the sale
            of emission allowances during the preceding year; and</DELETED>
            <DELETED>    (3) how, and to what extent, the load-serving
            entity used the proceeds of the sale of the emission allowances
            during the preceding year.</DELETED>
    <DELETED>    (b) Availability of Reports.--The Administrator shall make
    available to the public all reports submitted by any load-serving
    entity under subsection (b), including by publishing those reports on
    the Internet.</DELETED>

    <DELETED>Subtitle F--Bonus Allowances for Carbon Capture and Geological
                            Sequestration</DELETED>

    <DELETED>SEC. 3601. ALLOCATION.</DELETED>

    <DELETED>    (a) In General.--Not later than 3 years after the date of
    enactment of this Act, the Administrator shall--</DELETED>
            <DELETED>    (1) establish a Bonus Allowance Account;
            and</DELETED>
            <DELETED>    (2) allocate 4 percent of the emission allowances
            established for calendar years 2012 through 2035 to the Bonus
            Allowance Account.</DELETED>
    <DELETED>    (b) Initial Number of Allowances.--As of January 1, 2012,
    there shall be 3,932,160,000 emission allowances in the Bonus Allowance
    Account.</DELETED>

    <DELETED>SEC. 3602. QUALIFYING PROJECTS.</DELETED>

    <DELETED>    To be eligible to receive emission allowances under this
    subtitle, a carbon capture and sequestration project shall--</DELETED>
            <DELETED>    (1) comply with such criteria and procedures as
            the Administrator may establish, including a requirement for a
            minimum of an 85-percent capture rate for carbon dioxide
            emissions on an annual basis from any unit for which allowances
            are allocated;</DELETED>
            <DELETED>    (2) sequester in a geological formation permitted
            by the Administrator for that purpose in accordance with
            regulations promulgated under section 1421(d) of the Safe
            Drinking Water Act (42 U.S.C. 300h(d)) carbon dioxide resulting
            from electric power generation; and</DELETED>
            <DELETED>    (3) have begun operation during the period
            beginning on January 1, 2008, and ending on December 31,
            2035.</DELETED>

    <DELETED>SEC. 3603. DISTRIBUTION.</DELETED>

    <DELETED>    Subject to section 3604, for each of calendar years 2012
    through 2039, the Administrator shall distribute emission allowances
    from the Bonus Allowance Account to each qualifying project under this
    subtitle in a quantity equal to the product obtained by multiplying the
    number of metric tons of carbon dioxide geologically sequestered by the
    project and the bonus allowance rate for that calendar year, as
    provided in the following table:</DELETED>

                              Year                                             Bonus Allowance Rate

    2012                                                     4.5
    2013                                                     4.5
    2014                                                     4.5
    2015                                                     4.5
    2016                                                     4.5
    2017                                                     4.5
    2018                                                     4.2
    2019                                                     3.9
    2020                                                     3.6
    2021                                                     3.3
    2022                                                     3.0
    2023                                                     2.7
    2024                                                     2.4
    2025                                                     2.1
    2026                                                     1.8
    2027                                                     1.5
    2028                                                     1.3
    2029                                                     1.1
    2030                                                     0.9
    2031                                                     0.7
    2032                                                     0.5
    2033                                                     0.5
    2034                                                     0.5
    2035                                                     0.5
    2036                                                     0.5
    2037                                                     0.5
    2038                                                     0.5
    2039                                                     0.5

    <DELETED>SEC. 3604. 10-YEAR LIMIT.</DELETED>

    <DELETED>    A qualifying project may receive annual emission
    allowances under this subsection only for--</DELETED>
            <DELETED>    (1) the first 10 years of operation; or</DELETED>
            <DELETED>    (2) if the unit covered by the qualifying project
            began operating before January 1, 2012, the period of calendar
            years 2012 through 2021.</DELETED>

    <DELETED>SEC. 3605. EXHAUSTION OF BONUS ALLOWANCE ACCOUNT.</DELETED>

    <DELETED>    If, at the beginning of a calendar year, the Administrator
    determines that the number of emission allowances remaining in the
    Bonus Allowance Account will be insufficient to allow the distribution,
    in that calendar year, of the number of allowances that otherwise would
    be distributed under section 3603 for the calendar year, the
    Administrator shall, for the calendar year--</DELETED>
            <DELETED>    (1) distribute the remaining bonus allowances only
            to qualifying projects that were already qualifying projects
            during the preceding calendar year;</DELETED>
            <DELETED>    (2) distribute the remaining bonus allowances to
            those qualifying projects on a pro rata basis; and</DELETED>
            <DELETED>    (3) discontinue the program established under this
            subtitle as of the date on which the Bonus Allowance Account is
            projected to be fully used based on projects already in
            operation.</DELETED>

        <DELETED>Subtitle G--Domestic Agriculture and Forestry</DELETED>

    <DELETED>SEC. 3701. ALLOCATION.</DELETED>

    <DELETED>    Not later than January 1, 2012, and annually thereafter
    through January 1, 2050, the Administrator shall allocate to the
    Secretary of Agriculture 5 percent of the Emission Allowance Account
    for the calendar year for use in--</DELETED>
            <DELETED>    (1) reducing greenhouse gas emissions from the
            agriculture and forestry sectors of the United States economy;
            and</DELETED>
            <DELETED>    (2) increasing greenhouse gas sequestration from
            those sectors.</DELETED>

    <DELETED>SEC. 3702. AGRICULTURAL AND FORESTRY GREENHOUSE GAS MANAGEMENT
                  RESEARCH.</DELETED>

    <DELETED>    (a) Report.--Not later than 1 year after the date of
    enactment of this Act, the Secretary of Agriculture, in consultation
    with scientific and agricultural and forestry experts, shall prepare
    and submit to Congress a report that describes the status of research
    on agricultural and forestry greenhouse gas management, including a
    description of--</DELETED>
            <DELETED>    (1) research on soil carbon sequestration and
            other agricultural and forestry greenhouse gas management that
            has been carried out;</DELETED>
            <DELETED>    (2) any additional research that is
            necessary;</DELETED>
            <DELETED>    (3) the proposed priority for additional
            research;</DELETED>
            <DELETED>    (4) the most appropriate approaches for conducting
            the additional research; and</DELETED>
            <DELETED>    (5) the manner in which carbon credits that are
            specific to agricultural and forestry operations should be
            valued and allotted.</DELETED>
    <DELETED>    (b) Standardized System of Soil Carbon Measurement and
    Certification for the Agricultural and Forestry Sectors.--</DELETED>
            <DELETED>    (1) In general.--As soon as practicable after the
            date of enactment of this Act, the Secretary of Agriculture
            shall establish a standardized system of carbon measurement and
            certification for the agricultural and forestry
            sectors.</DELETED>
            <DELETED>    (2) Administration.--In establishing the system,
            the Secretary of Agriculture shall--</DELETED>
                    <DELETED>    (A) create a standardized system of
                    measurements for agricultural and forestry greenhouse
                    gases; and</DELETED>
                    <DELETED>    (B) delineate the most appropriate system
                    of certification of credit by public or private
                    entities.</DELETED>
    <DELETED>    (c) Research.--After the date of submission of the report
    described in paragraph (1), the President and the Secretary of
    Agriculture (in collaboration with the member institutions of higher
    education of the Consortium for Agricultural Soil Mitigation of
    Greenhouse Gases, institutions of higher education, and research
    entities) shall initiate a program to conduct any additional research
    that is necessary.</DELETED>

    <DELETED>SEC. 3703. DISTRIBUTION.</DELETED>

    <DELETED>    Taking into account the report prepared under subsection
    3702(a), the Secretary of Agriculture shall establish, by regulation, a
    program under which agricultural and forestry sequestration allowances
    may be distributed to entities that carry out sequestration projects on
    agricultural and forest land that achieve long-term greenhouse gas
    emission mitigation benefits.</DELETED>

         <DELETED>Subtitle H--International Forest Protection</DELETED>

    <DELETED>SEC. 3801. FINDINGS.</DELETED>

    <DELETED>    Congress finds that--</DELETED>
            <DELETED>    (1) land-use change and forest sector emissions
            account for approximately 20 percent of global greenhouse gas
            emissions;</DELETED>
            <DELETED>    (2) land conversion and deforestation are 2 of the
            largest sources of greenhouse gas emissions in the developing
            world, amounting to roughly 40 percent of the total greenhouse
            gas emissions of the developing world;</DELETED>
            <DELETED>    (3) with sufficient data, deforestation rates and
            forest carbon stocks can be measured with an acceptable level
            of uncertainty; and</DELETED>
            <DELETED>    (4) encouraging reduced deforestation and other
            forest carbon activities in other countries can--</DELETED>
                    <DELETED>    (A) provide critical leverage to encourage
                    voluntary developing country participation in emission
                    limitation regimes;</DELETED>
                    <DELETED>    (B) facilitate greater overall reductions
                    in greenhouse gas emissions than would otherwise be
                    practicable; and</DELETED>
                    <DELETED>    (C) substantially benefit biodiversity,
                    conservation, and indigenous and other forest-dependent
                    people in developing countries.</DELETED>

    <DELETED>SEC. 3802. DEFINITION OF FOREST CARBON ACTIVITIES.</DELETED>

    <DELETED>    In this subtitle, the term ``forest carbon activities''
    means--</DELETED>
            <DELETED>    (1) activities directed at reducing greenhouse gas
            emissions from deforestation and forest degradation in
            countries other than the United States; and</DELETED>
            <DELETED>    (2) activities directed at increasing
            sequestration of carbon through restoration of forests, and
            degraded land in countries other than the United States that
            has not been forested prior to restoration, afforestation, and
            improved forest management, that meet the eligibility
            requirements promulgated under section 3804(a).</DELETED>

    <DELETED>SEC. 3803. ALLOCATION.</DELETED>

    <DELETED>    Not later than January 1, 2012, and annually thereafter
    through January 1, 2050, the Administrator shall allocate and
    distribute 3 percent of the Emission Allowance Account for the calendar
    year for use in carrying out forest carbon activities in countries
    other than the United States.</DELETED>

    <DELETED>SEC. 3804. DEFINITION AND ELIGIBILITY REQUIREMENTS.</DELETED>

    <DELETED>    (a) Eligibility Requirements for Forest Carbon
    Activities.--Not later than 2 years after the date of enactment of this
    Act, the Administrator, in consultation with the Secretary of the
    Interior, the Secretary of State, and the Secretary of Agriculture,
    shall promulgate eligibility requirements for forest carbon activities
    directed at sequestration of carbon through restoration of forests and
    degraded land, afforestation, and improved forest management in
    countries other than the United States, including requirements that
    those activities be--</DELETED>
            <DELETED>    (1) carried out and managed in accordance with
            widely-accepted environmentally sustainable forestry practices;
            and</DELETED>
            <DELETED>    (2) designed--</DELETED>
                    <DELETED>    (A) to promote native species and
                    restoration of native forests, where practicable;
                    and</DELETED>
                    <DELETED>    (B) to avoid the introduction of invasive
                    nonnative species.</DELETED>
    <DELETED>    (b) Quality Criteria for Forest Carbon Allocations.--Not
    later than 2 years after the date of enactment of this Act, the
    Administrator, in consultation with the Secretary of the Interior, the
    Secretary of State, and the Secretary of Agriculture, shall promulgate
    regulations establishing the requirements for eligibility to receive
    allowances under this section, including requirements that ensure that
    the emission reductions or sequestrations are real, permanent,
    additional, and verifiable, with reliable measuring and monitoring and
    appropriate accounting for leakage.</DELETED>

    <DELETED>SEC. 3805. INTERNATIONAL FOREST CARBON ACTIVITIES.</DELETED>

    <DELETED>    (a) In General.--The Administrator, in consultation with
    the Secretary of State, shall identify and periodically update a list
    of countries that have--</DELETED>
            <DELETED>    (1) demonstrated capacity to participate in
            international forest carbon activities, including--</DELETED>
                    <DELETED>    (A) sufficient historical data on changes
                    in national forest carbon stocks;</DELETED>
                    <DELETED>    (B) technical capacity to monitor and
                    measure forest carbon fluxes with an acceptable level
                    of uncertainty; and</DELETED>
                    <DELETED>    (C) institutional capacity to reduce
                    emissions from deforestation and degradation;</DELETED>
            <DELETED>    (2) capped greenhouse gas emissions or otherwise
            established a national emission reference scenario based on
            historical data; and</DELETED>
            <DELETED>    (3) commenced an emission reduction program for
            the forest sector.</DELETED>
    <DELETED>    (b) Crediting and Additionality.--</DELETED>
            <DELETED>    (1) Reduction in deforestation and forest
            degradation.--A verified reduction in greenhouse gas emissions
            from deforestation and forest degradation under a cap or from a
            nationwide emissions reference scenario described in subsection
            (a) shall be--</DELETED>
                    <DELETED>    (A) eligible for crediting; and</DELETED>
                    <DELETED>    (B) considered to satisfy the
                    additionality criterion.</DELETED>
            <DELETED>    (2) Periodic review of national level reductions
            in deforestation and degradation.--The Administrator, in
            consultation with the Secretary of State, shall identify and
            periodically update a list of countries described in subsection
            (a) that have--</DELETED>
                    <DELETED>    (A) achieved national-level reductions of
                    deforestation and degradation below a historical
                    reference scenario, taking into consideration the
                    average annual deforestation and degradation rates of
                    the country and of all countries during a period of at
                    least 5 years; and</DELETED>
                    <DELETED>    (B) demonstrated those reductions using
                    remote sensing technology that meets international
                    standards.</DELETED>
            <DELETED>    (3) Other forest carbon activities.--A forest
            carbon activity, other than a reduction in deforestation or
            forest degradation, shall be eligible for crediting, subject to
            the quality criteria for forest carbon credits identified in
            this Act or in regulations promulgated under this
            Act.</DELETED>
    <DELETED>    (c) Recognition of Credits.--With respect to countries
    other than countries described in subsection (a), the Administrator--
    </DELETED>
            <DELETED>    (1) shall recognize credits from forest carbon
            activities, subject to the quality criteria for forest carbon
            credits identified in this Act and regulations promulgated
            under this Act; and</DELETED>
            <DELETED>    (2) is encouraged to identify other incentives,
            including economic and market-based incentives, to encourage
            developing countries with largely-intact native forests to
            protect those forests.</DELETED>

    <DELETED>SEC. 3806. REVIEWS AND DISCOUNT.</DELETED>

    <DELETED>    (a) Reviews.--Not later than 3 years after the date of
    enactment of this Act, and 5 years thereafter, the Administrator shall
    conduct a review of the credit program under this subtitle.</DELETED>
    <DELETED>    (b) Discount.--If, after the date that is 10 years after
    the date of enactment of this Act, the Administrator determines that
    foreign countries that, in the aggregate, generate greenhouse gas
    emissions accounting for more than 0.5 percent of global greenhouse gas
    emissions have not capped those emissions, established emissions
    reference scenarios based on historical data, or otherwise reduced
    total forest emissions, the Administrator may apply a discount to
    forest carbon credits imported into the United States from those
    countries.</DELETED>

               <DELETED>Subtitle I--Covered Facilities</DELETED>

    <DELETED>SEC. 3901. ALLOCATION.</DELETED>

    <DELETED>    Not later than April 1, 2012, and annually thereafter
    through January 1, 2035, the Administrator shall allocate percentages
    of the Emission Allowance Account for the calendar year to owners or
    operators of covered facilities within the electric power sector and
    the industrial sector, as follows:</DELETED>

    ----------------------------------------------------------------------------------------------------------------
                                            Percentage of Emission Allowance      Percentage of Emission Allowance
                  Calendar                  Account Allocated to the Electric    Account Allocated to the Industrial
                                                      Power Sector                             Sector
    ----------------------------------------------------------------------------------------------------------------
    2012                                  20                                    20
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2013                                  20                                    20
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2014                                  20                                    20
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2015                                  20                                    20
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2016                                  20                                    20
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2017                                  19                                    19
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2018                                  18                                    18
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2019                                  17                                    17
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2020                                  16                                    16
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2021                                  15                                    15
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2022                                  14                                    14
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2023                                  13                                    13
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2024                                  12                                    12
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2025                                  11                                    11
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2026                                  10                                    10
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2027                                  9                                     9
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2028                                  8                                     8
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2029                                  7                                     7
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2030                                  6                                     6
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2031                                  5                                     5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2032                                  4                                     4
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2033                                  3                                     3
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2034                                  2                                     2
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2035                                  1                                     1
    ----------------------------------------------------------------------------------------------------------------

    <DELETED>SEC. 3902. DISTRIBUTION SYSTEM.</DELETED>

    <DELETED>    Not later than 1 year after the date of enactment of this
    Act, the Administrator shall establish a system for distributing to
    covered facilities within the electric power and industrial sectors the
    emission allowances allocated under section 3901.</DELETED>

    <DELETED>SEC. 3903. DISTRIBUTING EMISSION ALLOWANCES WITHIN THE
                  ELECTRIC POWER SECTOR.</DELETED>

    <DELETED>    (a) New Entrants.--</DELETED>
            <DELETED>    (1) In general.--As part of the system established
            under section 3902, the Administrator shall, for each calendar
            year, set aside, from the quantity of emission allowances
            represented by the percentages described in the table contained
            in section 3901 for the electric power sector, a quantity of
            emission allowances for distribution to new entrant covered
            electric power sector facilities.</DELETED>
            <DELETED>    (2) Calculation of allowances.--The quantity of
            emission allowances distributed by the Administrator for a
            calendar year to a new covered electric power sector facility
            under paragraph (1) shall be equal to the product obtained by
            multiplying--</DELETED>
                    <DELETED>    (A) the average greenhouse gas emission
                    rate of all covered electric power sector facilities
                    that commenced operations during the 5 years preceding
                    the date of enactment of this Act; and</DELETED>
                    <DELETED>    (B) the electricity generated by the
                    facility during the calendar year, adjusted downward on
                    a pro rata basis for each new facility in the event
                    that insufficient allowances are available under
                    section 3901 for a calendar year.</DELETED>
    <DELETED>    (b) Facilities Owned by a Rural Electric Cooperative.--
    </DELETED>
            <DELETED>    (1) In general.--As part of the system established
            under section 3902, the Administrator shall, for each calendar
            year, set aside, from the quantity of emission allowances
            represented by the percentages described in the table contained
            in section 3901 for the electric power sector, a quantity of
            emission allowances for distribution to covered electric power
            sector facilities that are owned or operated by a rural
            electric cooperative.</DELETED>
            <DELETED>    (2) Calculation of allowances.--The quantity of
            emission allowances distributed by the Administrator in a
            calendar year under paragraph (1) to a covered electric power
            sector facility that is owned or operated by a rural electric
            cooperative shall be equal to the quantity of carbon dioxide
            equivalents that the covered electric power sector facility
            emitted during calendar year 2006.</DELETED>
    <DELETED>    (c) Incumbents.--</DELETED>
            <DELETED>    (1) In general.--As part of the system established
            under section 3902, the Administrator shall, for each calendar
            year, distribute to covered electric power sector facilities
            (other than facilities owned or operated by a rural electric
            cooperative) that were operating during the calendar year
            preceding the year in which this Act was enacted the emission
            allowances represented by the percentages described in the
            table contained in section 3901 for the electric power sector
            that remain after the distribution of emission allowances under
            subsections (a) and (b).</DELETED>
            <DELETED>    (2) Calculation of allowances.--The quantity of
            emission allowances distributed to a covered electric power
            sector facility under paragraph (1) shall be equal to the
            product obtained by multiplying--</DELETED>
                    <DELETED>    (A) the quantity of emission allowances
                    available for distribution under paragraph (1);
                    and</DELETED>
                    <DELETED>    (B) the quotient obtained by dividing--
                    </DELETED>
                            <DELETED>    (i) the annual average quantity of
                            carbon dioxide equivalents emitted by the
                            covered electric power sector facility during
                            the 3 calendar years preceding the date of
                            enactment of this Act; by</DELETED>
                            <DELETED>    (ii) the annual average of the
                            aggregate quantity of carbon dioxide
                            equivalents emitted by all covered electric
                            power sector facilities during those 3 calendar
                            years.</DELETED>

    <DELETED>SEC. 3904. DISTRIBUTING EMISSION ALLOWANCES WITHIN THE
                  INDUSTRIAL SECTOR.</DELETED>

    <DELETED>    (a) New Entrants.--</DELETED>
            <DELETED>    (1) In general.--As part of the system established
            under section 3902, the Administrator shall, for each calendar
            year, set aside, from the quantity of emission allowances
            represented by the percentages described in the table contained
            in section 3901 for the industrial sector, a quantity of
            emission allowances for distribution to new entrant covered
            industrial sector facilities.</DELETED>
            <DELETED>    (2) Calculation of allowances.--The quantity of
            emission allowances distributed by the Administrator in a
            calendar year to a new covered industrial sector facility under
            paragraph (1) shall be calculated pursuant to such formula as
            shall be established under the system established under section
            3902.</DELETED>
    <DELETED>    (b) Incumbents.--</DELETED>
            <DELETED>    (1) In general.--As part of the system established
            under section 3902, the Administrator shall, for each calendar
            year, distribute to covered industrial sector facilities that
            were operating during the calendar year preceding the year in
            which this Act was enacted the emission allowances represented
            by the percentages described in the table contained in section
            3901 for the industrial sector that remain after the
            distribution of emission allowances under subsection
            (a).</DELETED>
            <DELETED>    (2) Calculation of allowances.--The quantity of
            emission allowances distributed to a covered industrial sector
            facility under paragraph (1) shall be equal to the product
            obtained by multiplying--</DELETED>
                    <DELETED>    (A) the quantity of emission allowances
                    available for distribution under paragraph (1);
                    and</DELETED>
                    <DELETED>    (B) the quotient obtained by dividing--
                    </DELETED>
                            <DELETED>    (i) the annual average quantity of
                            carbon dioxide equivalents emitted by the
                            covered industrial sector facility during the 3
                            calendar years preceding the date of enactment
                            of this Act; by</DELETED>
                            <DELETED>    (ii) the annual average of the
                            aggregate quantity of carbon dioxide
                            equivalents emitted by all covered industrial
                            sector facilities during those 3 calendar
                            years.</DELETED>
    <DELETED>    (c) Revocation of Distribution Upon Facility Shutdown.--If
    a covered facility within the industrial sector receives a distribution
    of emission allowances under this section for a calendar year and is
    subsequently permanently shut down during that calendar year, the owner
    or operator of the facility shall promptly return to the Administrator
    a number of emission allowances equal to the difference between--
    </DELETED>
            <DELETED>    (1) the number of carbon dioxide equivalents
            emitted by the facility in that calendar year prior to the
            shutdown; and</DELETED>
            <DELETED>    (2) the number of emission allowances distributed
            to the facility by the Administrator for that calendar
            year.</DELETED>

       <DELETED>TITLE IV--AUCTIONS AND USES OF AUCTION PROCEEDS</DELETED>

                      <DELETED>Subtitle A--Funds</DELETED>

    <DELETED>SEC. 4101. ESTABLISHMENT.</DELETED>

    <DELETED>    There are established in the Treasury of the United States
    the following funds:</DELETED>
            <DELETED>    (1) The Energy Assistance Fund.</DELETED>
            <DELETED>    (2) The Climate Change Worker Training
            Fund.</DELETED>
            <DELETED>    (3) The Adaptation Fund.</DELETED>
            <DELETED>    (4) The Climate Change and National Security
            Fund.</DELETED>

    <DELETED>SEC. 4102. AMOUNTS IN FUNDS.</DELETED>

    <DELETED>    Each Fund established by section 4101 shall consist of
    such amounts as are appropriated to the respective Fund under section
    4103.</DELETED>

    <DELETED>SEC. 4103. TRANSFERS TO FUNDS.</DELETED>

    <DELETED>    There are appropriated to each Fund established by section
    4101, out of funds of the Treasury not otherwise appropriated, amounts
    equivalent to amounts deposited in each respective Fund under section
    4302(b)(2).</DELETED>

        <DELETED>Subtitle B--Climate Change Credit Corporation</DELETED>

    <DELETED>SEC. 4201. ESTABLISHMENT.</DELETED>

    <DELETED>    (a) In General.--There is established, as a nonprofit
    corporation without stock, a corporation to be known as the ``Climate
    Change Credit Corporation''.</DELETED>
    <DELETED>    (b) Treatment.--The Corporation shall not be considered to
    be an agency or establishment of the Federal Government.</DELETED>

    <DELETED>SEC. 4202. APPLICABLE LAWS.</DELETED>

    <DELETED>    The Corporation shall be subject to this title and, to the
    extent consistent with this title, the District of Columbia Business
    Corporation Act (D.C. Code section 29-301 et seq.).</DELETED>

    <DELETED>SEC. 4203. BOARD OF DIRECTORS.</DELETED>

    <DELETED>    (a) In General.--The Corporation shall have a board of
    directors composed of 5 individuals who are citizens of the United
    States, of whom 1 shall be elected annually by the board to serve as
    Chairperson.</DELETED>
    <DELETED>    (b) Political Affiliation.--Not more than 3 members of the
    board serving at any time may be affiliated with the same political
    party.</DELETED>
    <DELETED>    (c) Appointment and Term.--A member of the board shall be
    appointed by the President, by and with the advice and consent of the
    Senate, for a term of 5 years.</DELETED>
    <DELETED>    (d) Quorum.--Three members of the board shall constitute a
    quorum for a meeting of the board of directors.</DELETED>

                    <DELETED>Subtitle C--Auctions</DELETED>

    <DELETED>SEC. 4301. EARLY AUCTIONS.</DELETED>

    <DELETED>    (a) Initiation of Auctioning.--Not later than 1 year after
    the date of enactment of this Act, the Corporation shall begin
    auctioning the emission allowances allocated to the Corporation under
    section 3101.</DELETED>
    <DELETED>    (b) Completion of Auctioning.--Not later than December 31,
    2011, the Corporation shall complete auctioning of all allowances
    allocated to the Corporation under section 3101.</DELETED>
    <DELETED>    (c) Proceeds From Early Auctioning.--The Corporation shall
    use to carry out programs established under subtitle D all proceeds of
    early auctioning conducted by the Corporation under this
    section.</DELETED>

    <DELETED>SEC. 4302. ANNUAL AUCTIONS.</DELETED>

    <DELETED>    (a) In General.--Not later than 30 days after the
    beginning of a calendar year identified in the table contained in
    section 3201, and annually thereafter through calendar year 2050, the
    Corporation shall auction all of the allowances allocated to the
    Corporation for that year by the Administrator under section
    3201.</DELETED>
    <DELETED>    (b) Proceeds From Annual Auctioning.--</DELETED>
            <DELETED>    (1) In general.--For each of calendar years 2012
            through 2050, the Corporation shall use to carry out the
            programs established under subtitle D 55 percent of the
            proceeds from annual auctions that the Corporation conducts for
            the calendar year under this section.</DELETED>
            <DELETED>    (2) Deposit of funds.--For each of calendar years
            2012 through 2050, the Corporation shall, subject to subtitle
            H, deposit into the following Funds established by section 4101
            the following percentages of the proceeds from auctions that
            the Corporation conducts for the calendar year under this
            section:</DELETED>

    Energy Assistance Fund                   20
    Climate Change Worker Training Fund....   5
    Adaptation Fund........................  20

          <DELETED>Subtitle D--Energy Technology Deployment</DELETED>

    <DELETED>SEC. 4401. IN GENERAL.</DELETED>

    <DELETED>    For each calendar year, the Corporation shall use the
    amounts described in section 4301(c) and 4302(b) to carry out the
    programs established under this subtitle, as follows:</DELETED>
            <DELETED>    (1) Not more than 45 percent of the funds shall be
            used to carry out the zero- or low-carbon energy technologies
            program under section 4402.</DELETED>
            <DELETED>    (2) Not more than 35 percent of the funds shall be
            used as follows:</DELETED>
                    <DELETED>    (A) Not more than 28 percent shall be used
                    to carry out the advanced coal and sequestration
                    technologies program under section 4403.</DELETED>
                    <DELETED>    (B) Not more than 7 percent shall be used
                    to carry out the cellulosic biomass ethanol technology
                    deployment programs under section 4404.</DELETED>
            <DELETED>    (3) Not more than 20 percent shall be used to
            carry out the advanced technology vehicles manufacturing
            incentive program under section 4405.</DELETED>

    <DELETED>SEC. 4402. ZERO- OR LOW-CARBON ENERGY TECHNOLOGIES
                  DEPLOYMENT.</DELETED>

    <DELETED>    (a) Definitions.--In this section:</DELETED>
            <DELETED>    (1) Energy savings.--The term ``energy savings''
            means megawatt-hours of electricity or million British thermal
            units of natural gas saved by a product, in comparison to
            projected energy consumption under an energy-efficiency
            standard applicable to the product.</DELETED>
            <DELETED>    (2) High-efficiency consumer product.--The term
            ``high-efficiency consumer product'' means a covered product to
            which an energy conservation standard applies under section 325
            of the Energy Policy and Conservation Act (42 U.S.C. 6295), if
            the energy efficiency of the product exceeds the energy
            efficiency required under the standard.</DELETED>
            <DELETED>    (3) Zero- or low-carbon generation.--The term
            ``zero- or low-carbon generation'' means generation of
            electricity by an electric generation unit that--</DELETED>
                    <DELETED>    (A) emits no carbon dioxide into the
                    atmosphere, or is fossil-fuel fired and emits into the
                    atmosphere not more than 250 pounds of carbon dioxide
                    per megawatt-hour (after adjustment for any carbon
                    dioxide from the unit that is geologically
                    sequestered); and</DELETED>
                    <DELETED>    (B) was placed into commercial service
                    after the date of enactment of this Act.</DELETED>
    <DELETED>    (b) Financial Incentives Program.--During each fiscal year
    beginning on or after October 1, 2008, the Corporation shall
    competitively award financial incentives under this subsection in the
    technology categories of--</DELETED>
            <DELETED>    (1) the production of electricity from new zero-
            or low-carbon generation; and</DELETED>
            <DELETED>    (2) the manufacture of high-efficiency consumer
            products.</DELETED>
    <DELETED>    (c) Requirements.--</DELETED>
            <DELETED>    (1) In general.--The Corporation shall make awards
            under this section to producers of new zero- or low-carbon
            generation and to manufacturers of high-efficiency consumer
            products--</DELETED>
                    <DELETED>    (A) in the case of producers of new zero-
                    or low-carbon generation, based on the bid of each
                    producer in terms of dollars per megawatt-hour of
                    electricity generated; and</DELETED>
                    <DELETED>    (B) in the case of manufacturers of high-
                    efficiency consumer products, based on the bid of each
                    manufacturer in terms of dollars per megawatt-hour or
                    million British thermal units saved.</DELETED>
            <DELETED>    (2) Acceptance of bids.--</DELETED>
                    <DELETED>    (A) In general.--In making awards under
                    this subsection, the Corporation shall--</DELETED>
                            <DELETED>    (i) solicit bids for reverse
                            auction from appropriate producers and
                            manufacturers, as determined by the
                            Corporation; and</DELETED>
                            <DELETED>    (ii) award financial incentives to
                            the producers and manufacturers that submit the
                            lowest bids that meet the requirements
                            established by the Corporation.</DELETED>
                    <DELETED>    (B) Factors for conversion.--</DELETED>
                            <DELETED>    (i) In general.--For the purpose
                            of assessing bids under subparagraph (A), the
                            Corporation shall specify a factor for
                            converting megawatt-hours of electricity and
                            million British thermal units of natural gas to
                            common units.</DELETED>
                            <DELETED>    (ii) Requirement.--The conversion
                            factor shall be based on the relative
                            greenhouse gas emission benefits of electricity
                            and natural gas conservation.</DELETED>
    <DELETED>    (d) Forms of Awards.--</DELETED>
            <DELETED>    (1) Zero- and low-carbon generators.--An award for
            zero- or low-carbon generation under this subsection shall be
            in the form of a contract to provide a production payment for
            each year during the first 10 years of commercial service of
            the generation unit in an amount equal to the product obtained
            by multiplying--</DELETED>
                    <DELETED>    (A) the amount bid by the producer of the
                    zero- or low-carbon generation; and</DELETED>
                    <DELETED>    (B) the megawatt-hours estimated to be
                    generated by the zero- or low-carbon generation unit
                    each year.</DELETED>
            <DELETED>    (2) High-efficiency consumer products.--An award
            for a high-efficiency consumer product under this subsection
            shall be in the form of a lump sum payment in an amount equal
            to the product obtained by multiplying--</DELETED>
                    <DELETED>    (A) the amount bid by the manufacturer of
                    the high-efficiency consumer product; and</DELETED>
                    <DELETED>    (B) the energy savings during the
                    projected useful life of the high-efficiency consumer
                    product, not to exceed 10 years, as determined by the
                    Corporation.</DELETED>

    <DELETED>SEC. 4403. ADVANCED COAL AND SEQUESTRATION TECHNOLOGIES
                  PROGRAM.</DELETED>

    <DELETED>    (a) Advanced Coal Technologies.--</DELETED>
            <DELETED>    (1) Definition of advanced coal generation
            technology.--In this subsection, the term ``advanced coal
            generation technology'' means advanced a coal-fueled power
            plant technology that--</DELETED>
                    <DELETED>    (A) achieves a minimum efficiency of 30
                    percent with respect to higher heating value of the
                    feedstock, after all parasitic requirements for carbon
                    dioxide capture and compression to 2,000 pounds per
                    square inch absolute have been subtracted;</DELETED>
                    <DELETED>    (B) provides for the capture and
                    geological sequestration of at least 85 percent of
                    carbon dioxide produced at the facility, as determined
                    by the Corporation; and</DELETED>
                    <DELETED>    (C) has an emission rate of not more than
                    250 pounds of carbon dioxide per megawatt-hour of net
                    electricity generation, after subtracting the carbon
                    dioxide that is captured and sequestered.</DELETED>
            <DELETED>    (2) Demonstration projects.--The Corporation shall
            use not less than </DELETED>\<DELETED>1/4</DELETED>\
            <DELETED>of the amounts made available to carry out this
            section for each fiscal year to support demonstration projects
            using advanced coal generation technology, including retrofit
            technology that could be deployed on existing coal generation
            facilities.</DELETED>
            <DELETED>    (3) Deployment incentives.--</DELETED>
                    <DELETED>    (A) In general.--The Corporation shall use
                    not less than </DELETED>\<DELETED>1/4</DELETED>\
                    <DELETED>of the amounts made available to carry out
                    this subsection for each fiscal year to provide Federal
                    financial incentives to facilitate the deployment of
                    not more than 20 gigawatts of advanced coal generation
                    technologies.</DELETED>
                    <DELETED>    (B) Administration.--In providing
                    incentives under this paragraph, the Corporation
                    shall--</DELETED>
                            <DELETED>    (i) provide appropriate incentives
                            for regulated investor-owned utilities,
                            municipal utilities, electric cooperatives, and
                            independent power producers, as determined by
                            the Secretary of Energy; and</DELETED>
                            <DELETED>    (ii) ensure that a range of the
                            domestic coal types is employed in the
                            facilities that receive incentives under this
                            paragraph.</DELETED>
                    <DELETED>    (C) Funding requirements.--</DELETED>
                            <DELETED>    (i) Sequestration activities.--The
                            Corporation shall provide incentives only to
                            projects that will capture and sequester at
                            least 85 percent of the carbon dioxide produced
                            by the project facilities.</DELETED>
                            <DELETED>    (ii) Storage agreement required.--
                            The Corporation shall require a binding storage
                            agreement for the carbon dioxide captured in a
                            project under this subsection, in a geological
                            storage project permitted by the Administrator
                            under regulations promulgated pursuant to
                            section 1421(d) of the Safe Drinking Water Act
                            (42 U.S.C. 300h(d)).</DELETED>
                            <DELETED>    (iii) Projects using certain
                            coals.--In providing incentives under this
                            paragraph, the Corporation shall set aside not
                            less than 25 percent of any amounts made
                            available to carry out this subsection for
                            projects using lower-rank coals, such as
                            subbituminous coal and lignite.</DELETED>
            <DELETED>    (4) Distribution of funds.--A project that
            receives an award under this subsection may elect 1 of the
            following Federal financial incentives:</DELETED>
                    <DELETED>    (A) A loan guarantee.</DELETED>
                    <DELETED>    (B) A cost-sharing grant to cover the
                    incremental cost of installing and operating carbon
                    capture and storage equipment (for which utilization
                    costs may be covered for the first 10 years of
                    operation).</DELETED>
                    <DELETED>    (C) Production payments of not more than
                    1.5 cents per kilowatt-hour of electric output during
                    the first 10 years of commercial service of the
                    project.</DELETED>
            <DELETED>    (5) Limitation.--A project may not receive an
            award under this subsection if the project receives an award
            under section 4402.</DELETED>
    <DELETED>    (b) Sequestration.--</DELETED>
            <DELETED>    (1) In general.--The Corporation shall use not
            less than </DELETED>\<DELETED>1/2</DELETED>\ <DELETED>of the
            amounts made available to carry out this subsection for each
            fiscal year for large-scale geological carbon storage
            demonstration projects that store carbon dioxide captured from
            facilities for the generation of electricity using coal
            gasification or other advanced coal combustion processes,
            including facilities that receive assistance under subsection
            (a).</DELETED>
            <DELETED>    (2) Project capital and operating costs.--The
            Corporation shall provide assistance under this paragraph to
            reimburse the project owner for a percentage of the incremental
            project capital and operating costs of the project that are
            attributable to carbon capture and sequestration, as the
            Secretary determines to be appropriate.</DELETED>

    <DELETED>SEC. 4404. FUEL FROM CELLULOSIC BIOMASS.</DELETED>

    <DELETED>    (a) In General.--The Corporation shall provide deployment
    incentives under this section to encourage a variety of projects to
    produce transportation fuels from cellulosic biomass, relying on
    different feedstocks in different regions of the United
    States.</DELETED>
    <DELETED>    (b) Project Eligibility.--Incentives under this section
    shall be provided on a competitive basis to projects that produce fuels
    that--</DELETED>
            <DELETED>    (1) meet United States fuel and emission
            specifications;</DELETED>
            <DELETED>    (2) help diversify domestic transportation energy
            supplies; and</DELETED>
            <DELETED>    (3) improve or maintain air, water, soil, and
            habitat quality, and protect scarce water supplies.</DELETED>
    <DELETED>    (c) Incentives.--Incentives under this section may consist
    of--</DELETED>
            <DELETED>    (1) loan guarantees for the construction of
            production facilities and supporting infrastructure;
            or</DELETED>
            <DELETED>    (2) production payments through a reverse auction
            in accordance with subsection (d).</DELETED>
    <DELETED>    (d) Reverse Auction.--</DELETED>
            <DELETED>    (1) In general.--In providing incentives under
            this section, the Corporation shall--</DELETED>
                    <DELETED>    (A) prescribe rules under which producers
                    of fuel from cellulosic biomass may bid for production
                    payments under subsection (c)(2); and</DELETED>
                    <DELETED>    (B) solicit bids from producers of
                    different classes of transportation fuel, as the
                    Corporation determines to be appropriate.</DELETED>
            <DELETED>    (2) Requirement.--The rules under section 4402
            shall require that incentives shall be provided to the
            producers that submit the lowest bid (in terms of cents per
            gallon gasoline equivalent) for each class of transportation
            fuel from which the Corporation solicits a bid.</DELETED>

    <DELETED>SEC. 4405. ADVANCED TECHNOLOGY VEHICLES MANUFACTURING
                  INCENTIVE PROGRAM.</DELETED>

    <DELETED>    (a) Definitions.--In this section:</DELETED>
            <DELETED>    (1) Advanced technology vehicle.--The term
            ``advanced technology vehicle'' means a hybrid or advanced
            diesel light duty motor vehicle that meets--</DELETED>
                    <DELETED>    (A) the Tier II Bin 5 emission standard
                    established in rules prescribed by the Administrator
                    under section 202(i) of the Clean Air Act (42 U.S.C.
                    7521(i)), or a lower-numbered Bin emission
                    standard;</DELETED>
                    <DELETED>    (B) any new emission standard for fine
                    particulate matter prescribed by the Administrator
                    under that Act; and</DELETED>
                    <DELETED>    (C) at least 125 percent of the average
                    base year combined fuel economy, calculated on an
                    energy-equivalent basis, for vehicles of a
                    substantially similar footprint.</DELETED>
            <DELETED>    (2) Combined fuel economy.--The term ``combined
            fuel economy'' means--</DELETED>
                    <DELETED>    (A) the combined city-highway miles per
                    gallon values, as reported in accordance with section
                    32908 of title 49, United States Code; and</DELETED>
                    <DELETED>    (B) in the case of an electric drive
                    vehicle with the ability to recharge from an off-board
                    source, the reported mileage, as determined in a manner
                    consistent with the Society of Automotive Engineers
                    recommended practice for that configuration, or a
                    similar practice recommended by the Secretary of
                    Energy, using a petroleum equivalence factor for the
                    off-board electricity (as defined by the Secretary of
                    Energy).</DELETED>
            <DELETED>    (3) Engineering integration costs.--The term
            ``engineering integration costs'' includes the cost of
            engineering tasks relating to--</DELETED>
                    <DELETED>    (A) incorporating qualifying components
                    into the design of advanced technology vehicles;
                    and</DELETED>
                    <DELETED>    (B) designing new tooling and equipment
                    for production facilities that produce qualifying
                    components or advanced technology vehicles.</DELETED>
            <DELETED>    (4) Qualifying component.--The term ``qualifying
            component'' means a component that the Secretary of Energy
            determines to be--</DELETED>
                    <DELETED>    (A) specially designed for advanced
                    technology vehicles; and</DELETED>
                    <DELETED>    (B) installed for the purpose of meeting
                    the performance requirements of advanced technology
                    vehicles as specified in subparagraphs (A), (B), and
                    (C) of paragraph (1).</DELETED>
    <DELETED>    (b) Manufacturer Facility Conversion Awards.--The
    Corporation shall provide facility conversion funding awards under this
    subsection to automobile manufacturers and component suppliers to pay
    up to 30 percent of the cost of--</DELETED>
            <DELETED>    (1) reequipping or expanding an existing
            manufacturing facility to produce--</DELETED>
                    <DELETED>    (A) qualifying advanced technology
                    vehicles; or</DELETED>
                    <DELETED>    (B) qualifying components; and</DELETED>
            <DELETED>    (2) engineering integration of qualifying vehicles
            and qualifying components.</DELETED>
    <DELETED>    (c) Period of Availability.--An award under subsection (b)
    shall apply to--</DELETED>
            <DELETED>    (1) facilities and equipment placed in service
            after the date of enactment of this Act and before January 1,
            2016; and</DELETED>
            <DELETED>    (2) engineering integration costs incurred after
            the date of enactment of this Act.</DELETED>

                <DELETED>Subtitle E--Energy Consumers</DELETED>

    <DELETED>SEC. 4501. PROPORTIONS OF FUNDING AVAILABILITY.</DELETED>

    <DELETED>    All funds deposited into the Energy Assistance Fund
    established by section 4101 shall be made available, without further
    appropriation or fiscal year limitation, to the following programs in
    the following proportions:</DELETED>
            <DELETED>    (1) 50 percent of the funds to the low-income home
            energy assistance program established under the Low Income Home
            Energy Assistance Act of 1981 (42 U.S.C. 8621 et
            seq.).</DELETED>
            <DELETED>    (2) 25 percent of the funds to the Weatherization
            Assistance Program for Low-Income Persons established under
            part A of title IV of the Energy Conservation and Production
            Act (42 U.S.C. 6861 et seq.).</DELETED>
            <DELETED>    (3) 25 percent of the funds to the rural energy
            assistance program described in section 4502.</DELETED>

    <DELETED>SEC. 4502. RURAL ENERGY ASSISTANCE PROGRAM.</DELETED>

    <DELETED>    The Secretary of Energy shall carry out a program to use
    the funds made available under section 4501(3) to provide financial
    assistance to promote the availability of reasonably-priced electricity
    in off-grid rural regions in which electricity prices exceed 150
    percent of the national average, as determined by the Secretary of
    Energy.</DELETED>

     <DELETED>Subtitle F--Climate Change Worker Training Program</DELETED>

    <DELETED>SEC. 4601. FUNDING.</DELETED>

    <DELETED>    All funds deposited into the Climate Change Worker
    Training Fund established by section 4101 shall be made available,
    without further appropriation or fiscal year limitation, to carry out
    the programs established under this subtitle.</DELETED>

    <DELETED>SEC. 4602. PURPOSES.</DELETED>

    <DELETED>    The purposes of this subtitle are--</DELETED>
            <DELETED>    (1) to provide quality job training to any workers
            displaced by this Act;</DELETED>
            <DELETED>    (2) to provide assistance in the form of temporary
            wages and health care benefits to workers in
            training;</DELETED>
            <DELETED>    (3) to transition workers into jobs created as a
            result of this Act;</DELETED>
            <DELETED>    (4) to provide skilled workers to enterprises
            developing and marketing advanced technologies and practices
            that reduce greenhouse gas emissions of the United States;
            and</DELETED>
            <DELETED>    (5) to provide funding for State worker training
            programs.</DELETED>

    <DELETED>SEC. 4603. ESTABLISHMENT.</DELETED>

    <DELETED>    Not later than 180 days after the date of enactment of
    this Act, the Secretary of Labor, in consultation with the
    Administrator and the Secretary of Energy, shall establish a climate
    change worker training program that achieves the purposes of this
    subtitle.</DELETED>

    <DELETED>SEC. 4604. GRANTS TO STATES.</DELETED>

    <DELETED>    Not later than 1 year after the date of enactment of this
    Act, the Secretary of Labor shall establish a program to award grants
    to States, for use in funding State worker training programs, based on
    the impact of this Act on the workforce of each State, as determined by
    the Secretary of Labor.</DELETED>

    <DELETED>SEC. 4605. TYPES OF ASSISTANCE.</DELETED>

    <DELETED>    The types of assistance that workers may receive under the
    climate change worker training program shall include, as determined by
    the Secretary of Labor--</DELETED>
            <DELETED>    (1) income replacement;</DELETED>
            <DELETED>    (2) health care credits;</DELETED>
            <DELETED>    (3) travel costs incidental to participation in a
            training program under this subtitle; and</DELETED>
            <DELETED>    (4) a portion of the cost of relocating to a new
            job.</DELETED>

    <DELETED>Subtitle G--Adaptation Program for Natural Resources in United
                        States and Territories</DELETED>

    <DELETED>SEC. 4701. DEFINITIONS.</DELETED>

    <DELETED>    In this subtitle:</DELETED>
            <DELETED>    (1) Ecological process.--</DELETED>
                    <DELETED>    (A) In general.--The term ``ecological
                    process'' means a biological, chemical, or physical
                    interaction between the biotic and abiotic components
                    of an ecosystem.</DELETED>
                    <DELETED>    (B) Inclusions.--The term ``ecological
                    process'' includes--</DELETED>
                            <DELETED>    (i) nutrient cycling;</DELETED>
                            <DELETED>    (ii) pollination;</DELETED>
                            <DELETED>    (iii) predator-prey
                            relationships;</DELETED>
                            <DELETED>    (iv) soil formation;</DELETED>
                            <DELETED>    (v) gene flow;</DELETED>
                            <DELETED>    (vi) larval dispersal and
                            settlement;</DELETED>
                            <DELETED>    (vii) hydrological
                            cycling;</DELETED>
                            <DELETED>    (viii) decomposition;
                            and</DELETED>
                            <DELETED>    (ix) disturbance regimes, such as
                            fire and flooding.</DELETED>
            <DELETED>    (2) Fish and wildlife.--The term ``fish and
            wildlife'' means--</DELETED>
                    <DELETED>    (A) any species of wild fauna, including
                    fish and other aquatic species; and</DELETED>
                    <DELETED>    (B) any fauna in a captive breeding
                    program the object of which is to reintroduce
                    individuals of a depleted indigenous species into
                    previously occupied range.</DELETED>
            <DELETED>    (3) Habitat.--The term ``habitat'' means the
            physical, chemical, and biological properties that are used by
            wildlife (including aquatic and terrestrial plant communities)
            for growth, reproduction, and survival, food, water, cover, and
            space, on a tract of land, in a body of water, or in an area or
            region.</DELETED>
            <DELETED>    (4) Indian tribe.--The term ``Indian tribe'' has
            the meaning given the term in section 4 of the Indian Self-
            Determination and Education Assistance Act (25 U.S.C.
            450b).</DELETED>
            <DELETED>    (5) Plant.--The term ``plant'' means any species
            of wild flora.</DELETED>
            <DELETED>    (6) Secretary.--The term ``Secretary'' means the
            Secretary of the Interior.</DELETED>
            <DELETED>    (7) State.--The term ``State'' means--</DELETED>
                    <DELETED>    (A) a State;</DELETED>
                    <DELETED>    (B) the District of Columbia;</DELETED>
                    <DELETED>    (C) the Commonwealth of Puerto Rico;
                    and</DELETED>
                    <DELETED>    (D) any other territory or possession of
                    the United States.</DELETED>

    <DELETED>SEC. 4702. ADAPTATION FUND.</DELETED>

    <DELETED>    (a) In General.--All amounts deposited in the Adaptation
    Fund established by section 4101 shall be made available, without
    further appropriation or fiscal year limitation, to carry out
    activities (including research and education activities) that assist
    fish and wildlife, fish and wildlife habitat, plants, and associated
    ecological processes in adapting to and surviving the impacts of
    climate change (referred to in this subtitle as ``adaptation
    activities'') pursuant to this subtitle.</DELETED>
    <DELETED>    (b) Department of the Interior.--Of the amounts made
    available to carry out this subtitle--</DELETED>
            <DELETED>    (1) 40 percent shall be allocated to the
            Secretary, and subsequently made available to States through
            the Wildlife Conservation and Restoration Account established
            under section 3(a)(2) of the Pittman-Robertson Wildlife
            Restoration Act (16 U.S.C. 669b(a)(2)), to carry out adaptation
            activities in accordance with comprehensive wildlife
            conservation strategies and, where appropriate, other fish and
            wildlife conservation strategies, including--</DELETED>
                    <DELETED>    (A) plans under the National Fish Habitat
                    Initiative of the National Fish and Wildlife
                    Foundation;</DELETED>
                    <DELETED>    (B) North American Wetlands Conservation
                    Act (16 U.S.C. 4401 et seq.);</DELETED>
                    <DELETED>    (C) the Federal, State, and local
                    partnership known as ``Partners in Flight'';</DELETED>
                    <DELETED>    (D) coastal zone management
                    plans;</DELETED>
                    <DELETED>    (E) regional fishery management plans;
                    and</DELETED>
                    <DELETED>    (F) recovery plans for threatened and
                    endangered species under section 6 of the Endangered
                    Species Act of 1973 (16 U.S.C. 1535);</DELETED>
            <DELETED>    (2) 20 percent shall be allocated to the Secretary
            for use in funding adaptation activities carried out--
            </DELETED>
                    <DELETED>    (A) under endangered species, migratory
                    bird, and other fish and wildlife programs administered
                    by the United States Fish and Wildlife
                    Service;</DELETED>
                    <DELETED>    (B) on wildlife refuges and other public
                    land under the jurisdiction of the United States Fish
                    and Wildlife Service, Bureau of Land Management, or
                    National Park Service; or</DELETED>
                    <DELETED>    (C) within Federal water managed by the
                    Bureau of Reclamation; and</DELETED>
            <DELETED>    (3) 5 percent shall be allocated to the Secretary
            for adaptation activities carried out under cooperative grant
            programs, including--</DELETED>
                    <DELETED>    (A) the Tribal Wildlife Grants program of
                    the United States Fish and Wildlife Service;</DELETED>
                    <DELETED>    (B) the cooperative endangered species
                    conservation fund authorized under section 6(i) of the
                    Endangered Species Act of 1973 (16 U.S.C.
                    1535(i));</DELETED>
                    <DELETED>    (C) programs under the North American
                    Wetlands Conservation Act (16 U.S.C. 4401 et
                    seq.);</DELETED>
                    <DELETED>    (D) the Land and Water Conservation Fund
                    established under section 2 of the Land and Water
                    Conservation Fund Act of 1965 (16 U.S.C. 460l-
                    5);</DELETED>
                    <DELETED>    (E) the multinational species conservation
                    fund established under the heading ``multinational
                    species conservation fund'' of title I of the
                    Department of the Interior and Related Agencies
                    Appropriations Act, 1999 (16 U.S.C. 4246);</DELETED>
                    <DELETED>    (F) the Neotropical Migratory Bird
                    Conservation Fund established by section 9(a) of the
                    Neotropical Migratory Bird Conservation Act (16 U.S.C.
                    6108(a));</DELETED>
                    <DELETED>    (G) the Coastal Program of the United
                    States Fish and Wildlife Service; and</DELETED>
                    <DELETED>    (H) the National Fish Habitat Action
                    Plan.</DELETED>
    <DELETED>    (c) Forest Service.--Of the amounts made available each
    fiscal year to carry out this subtitle, 5 percent shall be allocated to
    the Secretary of Agriculture for use in funding adaptation activities
    carried out on National Forests and National Grasslands under the
    jurisdiction of the Forest Service.</DELETED>
    <DELETED>    (d) Environmental Protection Agency.--Of the amounts made
    available to carry out this subtitle, 12.5 percent shall be allocated
    to the Administrator for use in restoring and protecting--</DELETED>
            <DELETED>    (1) large-scale freshwater aquatic ecosystems,
            such as the Everglades, the Great Lakes, Flathead Lake, the
            Missouri River, and the Yellowstone River; and</DELETED>
            <DELETED>    (2) large-scale estuarine ecosystems, such as
            Chesapeake Bay and Long Island Sound.</DELETED>
    <DELETED>    (e) Corps of Engineers.--Of the amounts made available to
    carry out this subtitle, 12.5 percent shall be allocated to the Corps
    of Engineers for use in restoring--</DELETED>
            <DELETED>    (1) large-scale freshwater aquatic ecosystems,
            such as the ecosystems described in subsection (d)(1);
            and</DELETED>
            <DELETED>    (2) large-scale estuarine ecosystems, such as
            Chesapeake Bay, California Bay Delta, Coastal Louisiana, Long
            Island Sound, and Puget Sound.</DELETED>
    <DELETED>    (f) Department of Commerce.--Of the amounts made available
    to carry out this subtitle, 5 percent shall be allocated to the
    Secretary of Commerce for use in funding adaptation activities carried
    out in protecting and restoring coastal, estuarine, coral, and marine
    species and habitats, including adaptation activities in cooperative
    grant programs such as--</DELETED>
            <DELETED>    (1) the Coastal and Estuarine Land Conservation
            Program and the Community-Based Restoration Program of the
            National Oceanic and Atmospheric Administration; and</DELETED>
            <DELETED>    (2) programs under the Coastal Zone Management Act
            of 1972 (16 U.S.C. 1451 et seq.).</DELETED>
    <DELETED>    (g) Cost Sharing.--Notwithstanding any other provision of
    law, a State or Indian tribe that receives a grant under this section
    shall be required to provide 10 percent of the costs of each activity
    carried out using funds from the grant.</DELETED>
    <DELETED>    (h) Comprehensive Adaptation Strategy.--</DELETED>
            <DELETED>    (1) In general.--Effective beginning on the date
            that is 18 months after the date of enactment of this Act,
            funds made available to the Federal agencies under this
            subtitle shall be used only for activities that are consistent
            with a comprehensive adaptation strategy that--</DELETED>
                    <DELETED>    (A) is jointly approved by the head of
                    each of the Federal agencies, after--</DELETED>
                            <DELETED>    (i) consultation with States and
                            Indian tribes; and</DELETED>
                            <DELETED>    (ii) solicitation of public and
                            independent scientific input; and</DELETED>
                    <DELETED>    (B) describes the manner in which the
                    Federal Government will assist fish and wildlife, fish
                    and wildlife habitat, plants, and associated ecological
                    processes in adapting to and surviving the impacts of
                    climate change.</DELETED>
            <DELETED>    (2) Updating.--Each adaptation strategy described
            in paragraph (1) shall be updated at least every 5
            years.</DELETED>

           <DELETED>Subtitle H--Climate Change and National Security
                               Program</DELETED>

    <DELETED>SEC. 4801. INTERAGENCY CLIMATE CHANGE AND NATIONAL SECURITY
                  COUNCIL.</DELETED>

    <DELETED>    (a) Establishment.--There is established a Climate Change
    and National Security Council (referred to in this subtitle as the
    ``Council'').</DELETED>
    <DELETED>    (b) Membership.--The Council shall include--</DELETED>
            <DELETED>    (1) the Secretary of State, who shall serve as
            Chairperson of the Council;</DELETED>
            <DELETED>    (2) the Administrator;</DELETED>
            <DELETED>    (3) the Secretary of Defense; and</DELETED>
            <DELETED>    (4) the Director of National
            Intelligence.</DELETED>
    <DELETED>    (c) Duties.--The Council shall--</DELETED>
            <DELETED>    (1) submit annual reports to the President, the
            Committees on Environment and Public Works and Foreign
            Relations of the Senate, and the Committees on Energy and
            Commerce and Foreign Relations of the House of Representatives
            that describe--</DELETED>
                    <DELETED>    (A) the extent to which other countries
                    are committing to reducing greenhouse gas emissions
                    through mandatory programs;</DELETED>
                    <DELETED>    (B) the extent to which global climate
                    change, through the potential negative impacts of
                    climate change on sensitive populations and natural
                    resources in different regions of the world, may
                    threaten, cause, or exacerbate political instability or
                    international conflict in those regions; and</DELETED>
                    <DELETED>    (C) the ramifications of any potentially
                    destabilizing impacts climate change may have on the
                    national security of the United States, including--
                    </DELETED>
                            <DELETED>    (i) the creation of refugees;
                            and</DELETED>
                            <DELETED>    (ii) international or
                            intranational conflicts over water, food, land,
                            or other resources; and</DELETED>
            <DELETED>    (2) include in each annual report submitted under
            paragraph (1) recommendations on whether it is necessary to
            enhance the national security of the United States by funding
            programs with amounts made available under section 4802 that
            the Council determines would assist in avoiding the politically
            destabilizing impacts of climate change in volatile regions of
            the world.</DELETED>

    <DELETED>SEC. 4802. FUNDING.</DELETED>

    <DELETED>    Upon a determination for any calendar year by the
    President, based on any report and recommendations submitted by the
    Council under section 4801, that funds should be made available to
    carry out the recommendations--</DELETED>
            <DELETED>    (1) notwithstanding section 4302(b)(2), the
            Corporation shall deposit 5 percent of the proceeds from
            auctions that the Corporation conducts for that calendar year
            under section 4302(a) into the Climate Change and National
            Security Fund established by section 4101; and</DELETED>
            <DELETED>    (2) the President shall use those funds to
            implement the recommendations.</DELETED>

                     <DELETED>Subtitle I--Audits</DELETED>

    <DELETED>SEC. 4901. REVIEW AND AUDIT BY COMPTROLLER GENERAL OF THE
                  UNITED STATES.</DELETED>

    <DELETED>    Not later than January 1, 2014, and at least every 3 years
    thereafter, the Comptroller General of the United States shall review
    and audit the expenditures under this title to determine the efficacy
    of the programs, expenditures, and projects funded under this
    title.</DELETED>

                 <DELETED>TITLE V--ENERGY EFFICIENCY</DELETED>

              <DELETED>Subtitle A--Appliance Efficiency</DELETED>

    <DELETED>SEC. 5101. RESIDENTIAL BOILERS.</DELETED>

    <DELETED>    Section 325(f) of the Energy Policy and Conservation Act
    (42 U.S.C. 6925(f)) is amended--</DELETED>
            <DELETED>    (1) in the subsection heading, by inserting ``and
            Boilers'' after ``Furnaces'';</DELETED>
            <DELETED>    (2) in paragraph (1), by striking ``except that''
            and all that follows through subparagraph (A) and inserting
            ``except that'';</DELETED>
            <DELETED>    (3) in subparagraph (B)--</DELETED>
                    <DELETED>    (A) by striking ``(B) the Secretary'' and
                    inserting ``the Secretary''; and</DELETED>
                    <DELETED>    (B) by redesignating clauses (i) through
                    (iii) as subparagraphs (A) through (C), respectively,
                    and indenting appropriately;</DELETED>
            <DELETED>    (4) by redesignating paragraph (3) as paragraph
            (4); and</DELETED>
            <DELETED>    (5) by inserting after paragraph (2) the
            following:</DELETED>
            <DELETED>    ``(3) Boilers.--</DELETED>
                    <DELETED>    ``(A) In general.--Subject to
                    subparagraphs (B) and (C), boilers manufactured on or
                    after September 1, 2012, shall meet the following
                    requirements:</DELETED>

    ------------------------------------------------------------------------
                                      Minimum
                                    Annual Fuel
      ``Boiler Type Requirements    Utilization             Design
                                     Efficiency
    ------------------------------------------------------------------------
    Gas hot water.................   82 percent  No constant burning pilot,
                                                  automatic means for
                                                  adjusting water
                                                  temperature
    Gas steam.....................   80 percent  No constant burning pilot
    Oil hot water.................   84 percent  Automatic means for
                                                  adjusting temperature
    Oil steam.....................   82 percent  None
    Electric hot water............         None  Automatic means for
                                                  adjusting temperature
    Electric steam................         None  None
    ------------------------------------------------------------------------

                    <DELETED>    ``(B) Automatic means for adjusting water
                    temperature.--</DELETED>
                            <DELETED>    ``(i) In general.--The
                            manufacturer shall equip each gas, oil, and
                            electric hot water boiler (other than a boiler
                            equipped with tankless domestic water heating
                            coils) with an automatic means for adjusting
                            the temperature of the water supplied by the
                            boiler to ensure that an incremental change in
                            inferred heat load produces a corresponding
                            incremental change in the temperature of water
                            supplied.</DELETED>
                            <DELETED>    ``(ii) Certain boilers.--For a
                            boiler that fires at 1 input rate, the
                            requirements of this subparagraph may be
                            satisfied by providing an automatic means that
                            allows the burner or heating element to fire
                            only when the means has determined that the
                            inferred heat load cannot be met by the
                            residual heat of the water in the
                            system.</DELETED>
                            <DELETED>    ``(iii) No inferred heat load.--
                            When there is no inferred heat load with
                            respect to a hot water boiler, the automatic
                            means described in clauses (i) and (ii) shall
                            limit the temperature of the water in the
                            boiler to not more than 140 degrees
                            Fahrenheit.</DELETED>
                            <DELETED>    ``(iv) Operation.--A boiler
                            described in clause (i) or (ii) shall be
                            operable only when the automatic means
                            described in clauses (i), (ii), and (iii) is
                            installed.</DELETED>
                    <DELETED>    ``(C) Exception.--A boiler that is
                    manufactured to operate without any need for
                    electricity, any electric connection, any electric
                    gauges, electric pumps, electric wires, or electric
                    devices of any sort, shall not be required to meet the
                    requirements of this subsection.''.</DELETED>

    <DELETED>SEC. 5102. REGIONAL VARIATIONS IN HEATING OR COOLING
                  STANDARDS.</DELETED>

    <DELETED>    (a) In General.--Section 327 of the Energy Policy and
    Conservation Act (42 U.S.C. 6297) is amended--</DELETED>
            <DELETED>    (1) by redesignating subsections (e), (f), and (g)
            as subsections (f), (g), and (h), respectively; and</DELETED>
            <DELETED>    (2) by inserting after subsection (d) the
            following:</DELETED>
    <DELETED>    ``(e) Regional Standards for Space Heating and Air
    Conditioning Products.--</DELETED>
            <DELETED>    ``(1) Standards.--</DELETED>
                    <DELETED>    ``(A) In general.--The Secretary may
                    establish regional standards for space heating and air
                    conditioning products, other than window-unit air-
                    conditioners and portable space heaters.</DELETED>
                    <DELETED>    ``(B) National minimum and regional
                    standards.--For each space heating and air conditioning
                    product, the Secretary may establish--</DELETED>
                            <DELETED>    ``(i) a national minimum standard;
                            and</DELETED>
                            <DELETED>    ``(ii) 2 more stringent regional
                            standards for regions determined to have
                            significantly differing climatic
                            conditions.</DELETED>
                    <DELETED>    ``(C) Maximum savings.--Any standards
                    established for a region under subparagraph (B)(ii)
                    shall achieve the maximum level of energy savings that
                    are technically feasible and economically justified
                    within that region.</DELETED>
                    <DELETED>    ``(D) Economic justifiability study.--
                    </DELETED>
                            <DELETED>    ``(i) In general.--As a
                            preliminary step in determining the economic
                            justifiability of establishing a regional
                            standard under subparagraph (B)(ii), the
                            Secretary shall conduct a study involving
                            stakeholders, including--</DELETED>
                                    <DELETED>    ``(I) a representative
                                    from the National Institute of
                                    Standards and Technology;</DELETED>
                                    <DELETED>    ``(II) representatives of
                                    nongovernmental advocacy
                                    organizations;</DELETED>
                                    <DELETED>    ``(III) representatives of
                                    product manufacturers, distributors,
                                    and installers;</DELETED>
                                    <DELETED>    ``(IV) representatives of
                                    the gas and electric utility
                                    industries; and</DELETED>
                                    <DELETED>    ``(V) such other
                                    individuals as the Secretary may
                                    designate.</DELETED>
                            <DELETED>    ``(ii) Requirements.--The study
                            under this subparagraph--</DELETED>
                                    <DELETED>    ``(I) shall determine the
                                    potential benefits and consequences of
                                    prescribing regional standards for
                                    heating and cooling products;
                                    and</DELETED>
                                    <DELETED>    ``(II) may, if favorable
                                    to the standards, constitute the
                                    evidence of economic justifiability
                                    required under this Act.</DELETED>
                    <DELETED>    ``(E) Regional boundaries.--Regional
                    boundaries used in establishing regional standards
                    under subparagraph (B)(ii) shall--</DELETED>
                            <DELETED>    ``(i) conform to State borders;
                            and</DELETED>
                            <DELETED>    ``(ii) include only contiguous
                            States (other than Alaska and Hawaii), except
                            that on the request of a State, the Secretary
                            may divide the State to include a part of the
                            State in each of 2 regions.</DELETED>
            <DELETED>    ``(2) Noncomplying products.--If the Secretary
            establishes standards for a region, it shall be unlawful under
            section 332 to offer for sale at retail, sell at retail, or
            install within the region products that do not comply with the
            applicable standards.</DELETED>
            <DELETED>    ``(3) Distribution in commerce.--</DELETED>
                    <DELETED>    ``(A) In general.--Except as provided in
                    subparagraph (B), no product manufactured in a manner
                    that complies with a regional standard established
                    under paragraph (1) shall be distributed in commerce
                    without a prominent label affixed to the product that
                    includes--</DELETED>
                            <DELETED>    ``(i) at the top of the label, in
                            print of not less than 14-point type, the
                            following statement: `It is a violation of
                            Federal law for this product to be installed in
                            any State outside the region shaded on the map
                            printed on this label.';</DELETED>
                            <DELETED>    ``(ii) below the notice described
                            in clause (i), an image of a map of the United
                            States with clearly defined State boundaries
                            and names, and with all States in which the
                            product meets or exceeds the standard
                            established pursuant to paragraph (1) shaded in
                            a color or a manner as to be easily visible
                            without obscuring the State boundaries and
                            names; and</DELETED>
                            <DELETED>    ``(iii) below the image of the map
                            required under clause (ii), the following
                            statement: `It is a violation of Federal law
                            for this label to be removed, except by the
                            owner and legal resident of any single-family
                            home in which this product is
                            installed.'.</DELETED>
                    <DELETED>    ``(B) Energy-efficiency rating.--A product
                    manufactured that meets or exceeds all regional
                    standards established under this paragraph shall bear a
                    prominent label affixed to the product that includes at
                    the top of the label, in print of not less than 14-
                    point type, the following statement: `This product has
                    achieved an energy-efficiency rating under Federal law
                    allowing its installation in any State.'.</DELETED>
            <DELETED>    ``(4) Recordkeeping.--A manufacturer of space
            heating or air conditioning equipment subject to regional
            standards established under this subsection shall--</DELETED>
                    <DELETED>    ``(A) obtain and retain records on the
                    intended installation locations of the equipment sold;
                    and</DELETED>
                    <DELETED>    ``(B) make such records available to the
                    Secretary on request.''.</DELETED>
    <DELETED>    (b) Conforming Amendments.--Section 327 of the Energy
    Policy and Conservation Act (42 U.S.C. 6297) is amended--</DELETED>
            <DELETED>    (1) in subsection (b)--</DELETED>
                    <DELETED>    (A) in paragraph (2), by striking
                    ``subsection (e)'' and inserting ``subsection (f)'';
                    and</DELETED>
                    <DELETED>    (B) in paragraph (3)--</DELETED>
                            <DELETED>    (i) by striking ``subsection
                            (f)(1)'' and inserting ``subsection (g)(1)'';
                            and</DELETED>
                            <DELETED>    (ii) by striking ``subsection
                            (f)(2)'' and inserting ``subsection (g)(2)'';
                            and</DELETED>
            <DELETED>    (2) in subsection (c)(3), by striking ``subsection
            (f)(3)'' and inserting ``subsection (g)(3)''.</DELETED>

               <DELETED>Subtitle B--Building Efficiency</DELETED>

    <DELETED>SEC. 5201. UPDATING STATE BUILDING ENERGY EFFICIENCY
                  CODES.</DELETED>

    <DELETED>    Section 304 of the Energy Conservation and Production Act
    (42 U.S.C. 6833) is amended to read as follows:</DELETED>

    <DELETED>``SEC. 304. UPDATING STATE BUILDING ENERGY EFFICIENCY
                  CODES.</DELETED>

    <DELETED>    ``(a) Updates.--</DELETED>
            <DELETED>    ``(1) In general.--The Secretary shall support
            updating the national model building energy codes and standards
            not later than 3 years after the date of enactment of the
            America's Climate Security Act of 2007, and not less frequently
            every 3 years thereafter, to achieve overall energy savings, as
            compared to the IECC (2006) for residential buildings and
            ASHRAE Standard 90.1 (2004) for commercial buildings, of at
            least--</DELETED>
                    <DELETED>    ``(A) 30 percent by 2010;</DELETED>
                    <DELETED>    ``(B) 50 percent by 2020; and</DELETED>
                    <DELETED>    ``(C) goals to be established by the
                    Secretary in intermediate and subsequent years, at the
                    maximum level of energy efficiency that is
                    technologically feasible and lifecycle cost
                    effective.</DELETED>
            <DELETED>    ``(2) Revisions to iecc and ashrae.--</DELETED>
                    <DELETED>    ``(A) In general.--If the IECC or ASHRAE
                    Standard 90.1 regarding building energy use is revised,
                    not later than 180 days after the date of the revision,
                    the Secretary shall determine whether the revision
                    will--</DELETED>
                            <DELETED>    ``(i) improve energy efficiency in
                            buildings; and</DELETED>
                            <DELETED>    ``(ii) meet the energy savings
                            goals described in paragraph (1).</DELETED>
                    <DELETED>    ``(B) Modifications.--</DELETED>
                            <DELETED>    ``(i) In general.--If the
                            Secretary makes a determination under
                            subparagraph (A)(ii) that a code or standard
                            does not meet the energy savings goals
                            established under paragraph (1) or if a
                            national model code or standard is not updated
                            for more than 3 years, not later than 1 year
                            after the determination or the expiration of
                            the 3-year period, the Secretary shall propose
                            a modified code or standard that meets the
                            energy savings goals.</DELETED>
                            <DELETED>    ``(ii) Requirements.--</DELETED>
                                    <DELETED>    ``(I) Energy savings.--A
                                    modification to a code or standard
                                    under clause (i) shall--</DELETED>
                                            <DELETED>    ``(aa) achieve the
                                            maximum level of energy savings
                                            that is technically feasible
                                            and economically justified;
                                            and</DELETED>
                                            <DELETED>    ``(bb) incorporate
                                            available appliances,
                                            technologies, and construction
                                            practices.</DELETED>
                                    <DELETED>    ``(II) Treatment as
                                    baseline.--A modification to a code or
                                    standard under clause (i) shall serve
                                    as the baseline for the next applicable
                                    determination of the Secretary under
                                    subparagraph (A)(i).</DELETED>
                    <DELETED>    ``(C) Public participation.--The Secretary
                    shall--</DELETED>
                            <DELETED>    ``(i) publish in the Federal
                            Register a notice relating to each goal,
                            determination, and modification under this
                            paragraph; and</DELETED>
                            <DELETED>    ``(ii) provide an opportunity for
                            public comment regarding the goals,
                            determinations, and modifications.</DELETED>
    <DELETED>    ``(b) State Certification of Building Energy Code
    Updates.--</DELETED>
            <DELETED>    ``(1) General certification.--</DELETED>
                    <DELETED>    ``(A) In general.--Not later than 2 years
                    after the date of enactment of the America's Climate
                    Security Act of 2007, each State shall certify to the
                    Secretary that the State has reviewed and updated the
                    provisions of the residential and commercial building
                    codes of the State regarding energy
                    efficiency.</DELETED>
                    <DELETED>    ``(B) Energy savings.--A certification
                    under subparagraph (A) shall include a demonstration
                    that the applicable provisions of the State code meet
                    or exceed, as applicable--</DELETED>
                            <DELETED>    ``(i)(I) the IECC (2006) for
                            residential buildings; or</DELETED>
                            <DELETED>    ``(II) the ASHRAE Standard 90.1
                            (2004) for commercial buildings; or</DELETED>
                            <DELETED>    ``(ii) the quantity of energy
                            savings represented by the provisions referred
                            to in clause (i).</DELETED>
            <DELETED>    ``(2) Revision of codes and standards.--</DELETED>
                    <DELETED>    ``(A) In general.--If the Secretary makes
                    an affirmative determination under subsection
                    (a)(2)(A)(i) or proposes a modified code or standard
                    under subsection (a)(2)(B), not later than 2 years
                    after the determination or proposal, each State shall
                    certify that the State has reviewed and updated the
                    provisions of the residential and commercial building
                    codes of the State regarding energy
                    efficiency.</DELETED>
                    <DELETED>    ``(B) Energy savings.--A certification
                    under subparagraph (A) shall include a demonstration
                    that the applicable provisions of the State code meet
                    or exceed--</DELETED>
                            <DELETED>    ``(i) the modified code or
                            standard; or</DELETED>
                            <DELETED>    ``(ii) the quantity of energy
                            savings represented by the modified code or
                            standard.</DELETED>
                    <DELETED>    ``(C) Failure to determine.--If the
                    Secretary fails to make a determination under
                    subsection (a)(2)(A)(i) by the date specified in
                    subsection (a)(2), or if the Secretary makes a negative
                    determination, not later than 2 years after the
                    specified date or the date of the determination, each
                    State shall certify that the State has--</DELETED>
                            <DELETED>    ``(i) reviewed the revised code or
                            standard; and</DELETED>
                            <DELETED>    ``(ii) updated the provisions of
                            the residential and commercial building codes
                            of the State as necessary to meet or exceed, as
                            applicable--</DELETED>
                                    <DELETED>    ``(I) any provisions of a
                                    national code or standard determined to
                                    improve energy efficiency in buildings;
                                    or</DELETED>
                                    <DELETED>    ``(II) energy savings
                                    achieved by those provisions through
                                    other means.</DELETED>
    <DELETED>    ``(c) Achievement of Compliance by States.--</DELETED>
            <DELETED>    ``(1) In general.--Not later than 3 years after
            the date on which a State makes a certification under
            subsection (b), the State shall certify to the Secretary that
            the State has achieved compliance with the national building
            energy code that is the subject of the certification.</DELETED>
            <DELETED>    ``(2) Rate of compliance.--The certification 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 State code during the
            preceding calendar year.</DELETED>
            <DELETED>    ``(3) Compliance.--A State shall be considered to
            achieve compliance for purposes of paragraph (1) if--</DELETED>
                    <DELETED>    ``(A) at least 90 percent of new and
                    renovated buildings covered by the State code during
                    the preceding calendar year substantially meet all the
                    requirements of the code; or</DELETED>
                    <DELETED>    ``(B) the estimated excess energy use of
                    new and renovated buildings that did not meet the
                    requirements of the State code during the preceding
                    calendar year, as compared to a baseline of comparable
                    buildings that meet the requirements of the code, is
                    not more than 10 percent of the estimated energy use of
                    all new and renovated buildings covered by the State
                    code during the preceding calendar year.</DELETED>
    <DELETED>    ``(d) Failure to Certify.--</DELETED>
            <DELETED>    ``(1) Extension of deadlines.--The Secretary shall
            extend a deadline for certification by a State under subsection
            (b) or (c) for not more than 1 additional year, if the State
            demonstrates to the satisfaction of the Secretary that the
            State has made--</DELETED>
                    <DELETED>    ``(A) a good faith effort to comply with
                    the certification requirement; and</DELETED>
                    <DELETED>    ``(B) significant progress with respect to
                    the compliance.</DELETED>
            <DELETED>    ``(2) Noncompliance by state.--</DELETED>
                    <DELETED>    ``(A) In general.--A State that fails to
                    submit a certification required under subsection (b) or
                    (c), and to which an extension is not provided under
                    paragraph (1), shall be considered to be out of
                    compliance with this section.</DELETED>
                    <DELETED>    ``(B) Effect on local governments.--A
                    local government of a State that is out of compliance
                    with this section may be considered to be in compliance
                    with this section if the local government meets each
                    applicable certification requirement of this
                    section.</DELETED>
    <DELETED>    ``(e) Technical Assistance.--</DELETED>
            <DELETED>    ``(1) In general.--The Secretary shall provide
            technical assistance (including building energy analysis and
            design tools, building demonstrations, and design assistance
            and training) to ensure that national model building energy
            codes and standards meet the goals described in subsection
            (a)(1).</DELETED>
            <DELETED>    ``(2) Assistance to states.--The Secretary shall
            provide technical assistance to States--</DELETED>
                    <DELETED>    ``(A) to implement this section, including
                    procedures for States to demonstrate that the codes of
                    the States achieve equivalent or greater energy savings
                    than the national model codes and standards;</DELETED>
                    <DELETED>    ``(B) to improve and implement State
                    residential and commercial building energy efficiency
                    codes; and</DELETED>
                    <DELETED>    ``(C) to otherwise promote the design and
                    construction of energy-efficient buildings.</DELETED>
    <DELETED>    ``(f) Incentive Funding.--</DELETED>
            <DELETED>    ``(1) In general.--The Secretary shall provide
            incentive funding to States--</DELETED>
                    <DELETED>    ``(A) to implement this section;
                    and</DELETED>
                    <DELETED>    ``(B) to improve and implement State
                    residential and commercial building energy efficiency
                    codes, including increasing and verifying compliance
                    with the codes.</DELETED>
            <DELETED>    ``(2) Amount.--In determining whether, and in what
            amount, to provide incentive funding under this subsection, the
            Secretary shall take into consideration actions proposed by the
            State--</DELETED>
                    <DELETED>    ``(A) to implement this section;</DELETED>
                    <DELETED>    ``(B) to implement and improve residential
                    and commercial building energy efficiency codes;
                    and</DELETED>
                    <DELETED>    ``(C) to promote building energy
                    efficiency through use of the codes.</DELETED>
            <DELETED>    ``(3) Additional funding.--The Secretary shall
            provide additional funding under this subsection for
            implementation of a plan to demonstrate a rate of compliance
            with applicable residential and commercial building energy
            efficiency codes at a rate of not less than 90 percent, based
            on energy performance--</DELETED>
                    <DELETED>    ``(A) to a State that has adopted and is
                    implementing, on a statewide basis--</DELETED>
                            <DELETED>    ``(i) a residential building
                            energy efficiency code that meets or exceeds
                            the requirements of the IECC (2006) (or a
                            successor code that is the subject of an
                            affirmative determination by the Secretary
                            under subsection (a)(2)(A)(i)); and</DELETED>
                            <DELETED>    ``(ii) a commercial building
                            energy efficiency code that meets or exceeds
                            the requirements of the ASHRAE Standard 90.1
                            (2004) (or a successor standard that is the
                            subject of an affirmative determination by the
                            Secretary under subsection (a)(2)(A)(i));
                            or</DELETED>
                    <DELETED>    ``(B) in the case of a State in which no
                    statewide energy code exists for residential buildings
                    or commercial buildings, or in which the State code
                    fails 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).</DELETED>
            <DELETED>    ``(4) Training.--Of the amounts made available to
            carry out this subsection, the Secretary may use not more than
            $500,000 for each State to train State and local officials to
            implement State or local energy codes in accordance with a plan
            described in paragraph (3).''.</DELETED>

    <DELETED>SEC. 5202. CONFORMING AMENDMENT.</DELETED>

    <DELETED>    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:</DELETED>
            <DELETED>    ``(17) IECC.--The term `IECC' means the
            International Energy Conservation Code.''.</DELETED>

           <DELETED>TITLE VI--GLOBAL EFFORT TO REDUCE GREENHOUSE GAS
                              EMISSIONS</DELETED>

    <DELETED>SEC. 6001. DEFINITIONS.</DELETED>

    <DELETED>    In this title:</DELETED>
            <DELETED>    (1) Baseline emission level.--The term ``baseline
            emission level'' means, as determined by the Administrator, the
            total average annual greenhouse gas emissions attributed to a
            category of covered goods of a foreign country during the
            period beginning on January 1, 2012, and ending on December 31,
            2014, based on--</DELETED>
                    <DELETED>    (A) relevant data available for that
                    period; and</DELETED>
                    <DELETED>    (B) to the extent necessary with respect
                    to a specific category of covered goods, economic and
                    engineering models and best available information on
                    technology performance levels for the manufacture of
                    that category of covered goods.</DELETED>
            <DELETED>    (2) Comparable action.--The term ``comparable
            action'' means any greenhouse gas regulatory programs,
            requirements, and other measures adopted by a foreign country
            that, in combination, are comparable in effect to actions
            carried out by the United States to limit greenhouse gas
            emissions pursuant to this Act, as determined by the President,
            taking into consideration the level of economic development of
            the foreign country.</DELETED>
            <DELETED>    (3) Compliance year.--The term ``compliance year''
            means each calendar year for which the requirements of this
            title apply to a category of covered goods of a covered foreign
            country that is imported into the United States.</DELETED>
            <DELETED>    (4) Covered foreign country.--The term ``covered
            foreign country'' means a foreign country that is included on
            the covered list prepared under section 6006(b)(3).</DELETED>
            <DELETED>    (5) Covered good.--The term ``covered good'' means
            a good that (as identified by the Administrator by rule)--
            </DELETED>
                    <DELETED>    (A) is a primary product;</DELETED>
                    <DELETED>    (B) generates, in the course of the
                    manufacture of the good, a substantial quantity of
                    direct greenhouse gas emissions and indirect greenhouse
                    gas emissions; and</DELETED>
                    <DELETED>    (C) is closely related to a good the cost
                    of production of which in the United States is affected
                    by a requirement of this Act.</DELETED>
            <DELETED>    (6) Foreign country.--The term ``foreign country''
            means a member of, or observer government to, the World Trade
            Organization (WTO), other than the United States.</DELETED>
            <DELETED>    (7) Indirect greenhouse gas emissions.--The term
            ``indirect greenhouse gas emissions'' means any emissions of a
            greenhouse gas resulting from the generation of electricity
            that is consumed during the manufacture of a good.</DELETED>
            <DELETED>    (8) International agreement.--The term
            ``international agreement'' means any international agreement
            to which the United States is a party, including the Marrakesh
            agreement establishing the World Trade Organization, done at
            Marrakesh on April 15, 1994.</DELETED>
            <DELETED>    (9) International reserve allowance.--The term
            ``international reserve allowance'' means an allowance
            (denominated in units of metric tons of carbon dioxide
            equivalent) that is--</DELETED>
                    <DELETED>    (A) purchased from a special reserve of
                    allowances pursuant to section 6006(a)(2);
                    and</DELETED>
                    <DELETED>    (B) used for purposes of meeting the
                    requirements of section 6006.</DELETED>
            <DELETED>    (10) Primary product.--The term ``primary
            product'' means--</DELETED>
                    <DELETED>    (A) iron, steel, aluminum, cement, bulk
                    glass, or paper; or</DELETED>
                    <DELETED>    (B) any other manufactured product that--
                    </DELETED>
                            <DELETED>    (i) is sold in bulk for purposes
                            of further manufacture; and</DELETED>
                            <DELETED>    (ii) generates, in the course of
                            the manufacture of the product, direct
                            greenhouse gas emissions and indirect
                            greenhouse gas emissions that are comparable
                            (on an emissions-per-dollar basis) to emissions
                            generated in the manufacture of products by
                            covered facilities in the industrial
                            sector.</DELETED>

    <DELETED>SEC. 6002. PURPOSES.</DELETED>

    <DELETED>    The purposes of this title are--</DELETED>
            <DELETED>    (1) to promote a strong global effort to
            significantly reduce greenhouse gas emissions;</DELETED>
            <DELETED>    (2) to ensure, to the maximum extent practicable,
            that greenhouse gas emissions occurring outside the United
            States do not undermine the objectives of the United States in
            addressing global climate change; and</DELETED>
            <DELETED>    (3) to encourage effective international action to
            achieve those objectives through--</DELETED>
                    <DELETED>    (A) agreements negotiated between the
                    United States and foreign countries; and</DELETED>
                    <DELETED>    (B) measures carried out by the United
                    States that comply with applicable international
                    agreements.</DELETED>

    <DELETED>SEC. 6003. INTERNATIONAL NEGOTIATIONS.</DELETED>

    <DELETED>    (a) Finding.--Congress finds that the purposes described
    in section 6002 can be most effectively addressed and achieved through
    agreements negotiated between the United States and foreign
    countries.</DELETED>
    <DELETED>    (b) Negotiating Objective.--</DELETED>
            <DELETED>    (1) Statement of policy.--It is the policy of the
            United States to work proactively under the United Nations
            Framework Convention on Climate Change and, in other
            appropriate forums, to establish binding agreements committing
            all major greenhouse gas-emitting nations to contribute
            equitably to the reduction of global greenhouse gas
            emissions.</DELETED>
            <DELETED>    (2) Intent of congress regarding objective.--To
            the extent that the agreements described in subsection (a)
            involve measures that will affect international trade in any
            good or service, it is the intent of Congress that the
            negotiating objective of the United States shall be to focus
            multilateral and bilateral international agreements on the
            reduction of greenhouse gas emissions to advance achievement of
            the purposes described in section 6002.</DELETED>

    <DELETED>SEC. 6004. INTERAGENCY REVIEW.</DELETED>

    <DELETED>    (a) Interagency Group.--</DELETED>
            <DELETED>    (1) Establishment.--The President shall establish
            an interagency group to carry out this section.</DELETED>
            <DELETED>    (2) Chairperson.--The chairperson of the
            interagency group established under paragraph (1) shall be the
            Secretary of State.</DELETED>
            <DELETED>    (3) Requirement.--The Administrator shall be a
            member of the interagency group.</DELETED>
    <DELETED>    (b) Determinations.--</DELETED>
            <DELETED>    (1) In general.--Subject to paragraph (2), the
            interagency group established under subsection (a)(1) shall
            determine whether, and the extent to which, each foreign
            country has taken comparable action to limit the greenhouse gas
            emissions of the foreign country.</DELETED>
            <DELETED>    (2) Exemption.--The interagency group may exempt
            from a determination under paragraph (1) any foreign country on
            the excluded list under section 6006(b)(2).</DELETED>
    <DELETED>    (c) Report to President.--Not later than January 1, 2018,
    and annually thereafter, the interagency group shall submit to the
    President a report describing the determinations of the interagency
    group under subsection (b).</DELETED>

    <DELETED>SEC. 6005. PRESIDENTIAL DETERMINATIONS.</DELETED>

    <DELETED>    (a) In General.--Not later than January 1, 2019, and
    annually thereafter, the President shall determine whether each foreign
    country that is subject to interagency review under section 6004(b) has
    taken comparable action to limit the greenhouse gas emissions of the
    foreign country, taking into consideration--</DELETED>
            <DELETED>    (1) the baseline emission levels of the foreign
            country; and</DELETED>
            <DELETED>    (2) applicable reports submitted under section
            6004(c).</DELETED>
    <DELETED>    (b) Reports.--The President shall--</DELETED>
            <DELETED>    (1) submit to Congress an annual report describing
            the determinations of the President under subsection (a) for
            the most recent calendar year; and</DELETED>
            <DELETED>    (2) publish the determinations in the Federal
            Register.</DELETED>

    <DELETED>SEC. 6006. INTERNATIONAL RESERVE ALLOWANCE PROGRAM.</DELETED>

    <DELETED>    (a) Establishment.--</DELETED>
            <DELETED>    (1) In general.--The Administrator shall establish
            a program under which the Administrator, during the 1-year
            period beginning on January 1, 2019, and annually thereafter,
            shall offer for sale to United States importers international
            reserve allowances in accordance with this
            subsection.</DELETED>
            <DELETED>    (2) Source.--International reserve allowances
            under paragraph (1) shall be issued from a special reserve of
            allowances that is separate from, and established in addition
            to, the quantity of allowances established under section
            1201.</DELETED>
            <DELETED>    (3) Price.--</DELETED>
                    <DELETED>    (A) In general.--Subject to subparagraph
                    (B), the Administrator shall establish, by rule, a
                    methodology for determining the price of international
                    reserve allowances for each compliance year at a level
                    that does not exceed the market price of allowances
                    established under section 1201 for the compliance
                    year.</DELETED>
                    <DELETED>    (B) Maximum price.--The price for an
                    international reserve allowance under subparagraph (A)
                    shall not exceed the clearing price for current
                    compliance year allowances established at the most
                    recent auction of allowances by the
                    Corporation.</DELETED>
            <DELETED>    (4) Serial number.--The Administrator shall assign
            a unique serial number to each international reserve allowance
            issued under this subsection.</DELETED>
            <DELETED>    (5) Trading system.--The Administrator may
            establish, by rule, a system for the sale, exchange, purchase,
            transfer, and banking of international reserve
            allowances.</DELETED>
            <DELETED>    (6) Regulated entities.--International reserve
            allowances may not be submitted by regulated entities to comply
            with the allowance submission requirements of section
            1202.</DELETED>
            <DELETED>    (7) Proceeds.--All proceeds from the sale of
            international reserve allowances under this subsection shall be
            allocated to a program that the Administrator, in coordination
            with the Secretary of State, shall establish to mitigate the
            negative impacts of global climate change on disadvantaged
            communities in other countries.</DELETED>
    <DELETED>    (b) Foreign Country Lists.--</DELETED>
            <DELETED>    (1) In general.--Not later than January 1, 2020,
            and annually thereafter, the President shall develop and
            publish in the Federal Register 2 lists of foreign countries,
            in accordance with this subsection.</DELETED>
            <DELETED>    (2) Excluded list.--</DELETED>
                    <DELETED>    (A) In general.--The President shall
                    identify and publish in a list, to be known as the
                    ``excluded list'', each foreign country the share of
                    total global greenhouse gas emissions of which is below
                    the de minimis percentage described in subparagraph
                    (B).</DELETED>
                    <DELETED>    (B) De minimis percentage.--The de minimis
                    percentage referred to in subparagraph (A) is a
                    percentage of total global greenhouse gas emissions of
                    not more than 0.5, as determined by the President, for
                    the most recent calendar year for which emissions and
                    other relevant data is available, taking into
                    consideration, as necessary, the annual average
                    deforestation rate during a representative period for a
                    foreign country that is a developing country.</DELETED>
            <DELETED>    (3) Covered list.--</DELETED>
                    <DELETED>    (A) In general.--The President shall
                    identify and publish in a list, to be known as the
                    ``covered list'', each foreign country the covered
                    goods of which are subject to the requirements of this
                    section.</DELETED>
                    <DELETED>    (B) Requirement.--The covered list shall
                    include each foreign country that is not included on
                    the excluded list under paragraph (2).</DELETED>
    <DELETED>    (c) Written Declarations.--</DELETED>
            <DELETED>    (1) In general.--Effective beginning January 1,
            2020, a United States importer of any covered good shall, as a
            condition of importation or withdrawal for consumption from a
            warehouse of the covered good, submit to the Administrator and
            the appropriate office of the U.S. Customs and Border
            Protection a written declaration with respect to each such
            importation or withdrawal.</DELETED>
            <DELETED>    (2) Contents.--A written declaration under
            paragraph (1) shall contain a statement that--</DELETED>
                    <DELETED>    (A) the applicable covered good is
                    accompanied by a sufficient number of international
                    reserve allowances, as determined under subsection (d);
                    or</DELETED>
                    <DELETED>    (B) the covered good is from a foreign
                    country on the excluded list under subsection
                    (b)(2).</DELETED>
            <DELETED>    (3) Inclusion.--A written declaration described in
            paragraph (2)(A) shall include the unique serial number of each
            emission allowance associated with the importation of the
            applicable covered good.</DELETED>
            <DELETED>    (4) Failure to declare.--</DELETED>
                    <DELETED>    (A) In general.--Except as provided in
                    subparagraph (B), an imported covered good that is not
                    accompanied by a written declaration under this
                    subsection shall not be permitted to enter the customs
                    territory of the United States.</DELETED>
                    <DELETED>    (B) Exception for certain imports.--
                    Subparagraph (A) shall not apply to a covered good of a
                    foreign country if the President determines that--
                    </DELETED>
                            <DELETED>    (i) the foreign country has taken
                            comparable action to limit the greenhouse gas
                            emissions of the foreign country, in accordance
                            with section 6005;</DELETED>
                            <DELETED>    (ii) the United Nations has
                            identified the foreign country as among the
                            least-developed of developing countries;
                            or</DELETED>
                            <DELETED>    (iii) the foreign country is on
                            the excluded list under subsection
                            (b)(2).</DELETED>
            <DELETED>    (5) Corrected declaration.--</DELETED>
                    <DELETED>    (A) In general.--If, after making a
                    declaration required under this subsection, an importer
                    has reason to believe that the declaration contains
                    information that is not correct, the importer shall
                    provide a corrected declaration by not later than 30
                    days after the date of discovery of the error, in
                    accordance with subparagraph (B).</DELETED>
                    <DELETED>    (B) Method.--A corrected declaration under
                    subparagraph (A) shall be in the form of a letter or
                    other written statement to the Administrator and the
                    office of the U.S. Customs and Border Protection to
                    which the original declaration was submitted.</DELETED>
    <DELETED>    (d) Quantity of Allowances Required.--</DELETED>
            <DELETED>    (1) Methodology.--</DELETED>
                    <DELETED>    (A) In general.--The Administrator shall
                    establish, by rule, a method for calculating the
                    required number of international reserve allowances
                    that a United States importer must submit, together
                    with a written declaration under subsection (c), for
                    each category of covered goods of each covered foreign
                    country.</DELETED>
                    <DELETED>    (B) Formula.--The Administrator shall
                    develop a general formula for calculating the
                    international reserve allowance requirement that
                    applies, on a per unit basis, to each covered good of a
                    covered foreign country that is imported during each
                    compliance year.</DELETED>
            <DELETED>    (2) Initial compliance year.--</DELETED>
                    <DELETED>    (A) In general.--Subject to subparagraph
                    (B), the methodology under paragraph (1) shall
                    establish an international reserve allowance
                    requirement (per unit imported into the United States)
                    for the initial compliance year for each category of
                    covered goods of each covered foreign country that is
                    equal to the quotient obtained by dividing--</DELETED>
                            <DELETED>    (i) the excess, if any, of the
                            total emissions from the covered foreign
                            country that are attributable to the category
                            of covered goods produced during the most
                            recent year for which data are available, over
                            the baseline emission level of the covered
                            foreign country for that category;
                            and</DELETED>
                            <DELETED>    (ii) the total quantity of the
                            covered good produced in the covered foreign
                            country during the most recent calendar
                            year.</DELETED>
                    <DELETED>    (B) Adjustments.--The Administrator shall
                    adjust the requirement under subparagraph (A)--
                    </DELETED>
                            <DELETED>    (i) in accordance with the ratio
                            that--</DELETED>
                                    <DELETED>    (I) the quantity of
                                    allowances that were allocated at no
                                    cost to entities within the industry
                                    sector manufacturing the covered goods
                                    for the compliance year during which
                                    the covered goods were imported into
                                    the United States; bears to</DELETED>
                                    <DELETED>    (II) the greenhouse gas
                                    emissions of that industry sector;
                                    and</DELETED>
                            <DELETED>    (ii) to take into account the
                            level of economic development of the covered
                            foreign country in which the covered goods were
                            produced.</DELETED>
            <DELETED>    (3) Subsequent compliance years.--For each
            subsequent compliance year, the Administrator shall revise, as
            appropriate, the international reserve allowance requirement
            applicable to each category of imported covered goods of each
            covered foreign country to reflect changes in the factors
            described in paragraph (2)(B).</DELETED>
            <DELETED>    (4) Publication.--Not later than 90 days before
            the beginning of each compliance year, the Administrator shall
            publish in the Federal Register a schedule describing the
            required number of international reserve allowances for each
            category of imported covered goods of each covered foreign
            country, as calculated under this subsection.</DELETED>
    <DELETED>    (e) Foreign Allowances and Credits.--</DELETED>
            <DELETED>    (1) Foreign allowances.--</DELETED>
                    <DELETED>    (A) In general.--A United States importer
                    may submit, in lieu of an international reserve
                    allowance issued under this section, a foreign
                    allowance or similar compliance instrument distributed
                    by a foreign country pursuant to a cap and trade
                    program that represents a comparable action.</DELETED>
                    <DELETED>    (B) Commensurate cap and trade program.--
                    For purposes of subparagraph (A), a cap and trade
                    program that represents a comparable action shall
                    include any greenhouse gas regulatory program adopted
                    by a covered foreign country to limit the greenhouse
                    gas emissions of the covered foreign country, if the
                    President certifies that the program--</DELETED>
                            <DELETED>    (i)(I) places a quantitative
                            limitation on the total quantity of greenhouse
                            gas emissions of the covered foreign country
                            (expressed in terms of tons emitted per
                            calendar year); and</DELETED>
                            <DELETED>    (II) achieves that limitation
                            through an allowance trading system;</DELETED>
                            <DELETED>    (ii) satisfies such criteria as
                            the President may establish for requirements
                            relating to the enforceability of the cap and
                            trade program, including requirements for
                            monitoring, reporting, verification procedures,
                            and allowance tracking; and</DELETED>
                            <DELETED>    (iii) is a comparable
                            action.</DELETED>
            <DELETED>    (2) Foreign credits.--</DELETED>
                    <DELETED>    (A) In general.--A United States importer
                    may submit, in lieu of an international reserve
                    allowance issued under this section, a foreign credit
                    or a credit for an international offset project that
                    the Administrator has authorized for use under subtitle
                    E of title II.</DELETED>
                    <DELETED>    (B) Application.--The limitation on the
                    use of international reserve allowances by regulated
                    entities under subsection (a)(6) shall not apply to a
                    United States importer for purposes of this
                    paragraph.</DELETED>
    <DELETED>    (f) Retirement of Allowances.--The Administrator shall
    retire each international reserve allowance, foreign allowance, and
    foreign credit submitted to achieve compliance with this
    section.</DELETED>
    <DELETED>    (g) Consistency With International Agreements.--The
    Administrator, in consultation with the Secretary of State, shall
    adjust the international reserve allowance requirements established
    under this section (including the quantity of international reserve
    allowances required for each category of covered goods of a covered
    foreign country) as the Administrator determines to be necessary to
    ensure that the United States complies with all applicable
    international agreements.</DELETED>
    <DELETED>    (h) Termination.--The international reserve allowance
    requirements of this section shall not apply to a covered good of a
    covered foreign country in any case in which the President makes a
    determination described in subsection (b)(2) with respect to the
    covered goods of that covered foreign country.</DELETED>
    <DELETED>    (i) Final Regulations.--Not later than January 1, 2019,
    the Administrator shall promulgate such regulations as the
    Administrator determines to be necessary to carry out this
    section.</DELETED>

    <DELETED>SEC. 6007. ADJUSTMENT OF INTERNATIONAL RESERVE ALLOWANCE
                  REQUIREMENTS.</DELETED>

    <DELETED>    (a) In General.--Not later than January 1, 2023, and
    annually thereafter, the President shall prepare and submit to Congress
    a report that assesses the effectiveness of the applicable
    international reserve allowance requirements under section 6006 with
    respect to the covered goods of each covered foreign country.</DELETED>
    <DELETED>    (b) Inadequate Requirements.--If the President determines
    that an applicable international reserve allowance requirement is not
    adequate to achieve the purposes of this title, the President,
    simultaneously with the submission of the report under subsection (a),
    shall--</DELETED>
            <DELETED>    (1) adjust the requirement; or</DELETED>
            <DELETED>    (2) take such other action as the President
            determines to be necessary to improve the effectiveness of the
            requirement, in accordance with all applicable international
            agreements.</DELETED>
    <DELETED>    (c) Effective Date.--An adjustment under subsection (b)(1)
    shall take effect beginning on January 1 of the compliance year
    immediately following the date on which the adjustment is
    made.</DELETED>

                     <DELETED>TITLE VII--REVIEWS</DELETED>

    <DELETED>SEC. 7001. NATIONAL ACADEMY OF SCIENCES REVIEW.</DELETED>

    <DELETED>    (a) Report.--</DELETED>
            <DELETED>    (1) In general.--Not later than January 1, 2012,
            and every 3 years thereafter, the Administrator shall offer to
            enter into a contract with the National Academy of Sciences
            under which the Academy shall submit to Congress and the
            Administrator reports evaluating the implementation of this
            Act.</DELETED>
            <DELETED>    (2) Contents of report.--Each report submitted to
            Congress under paragraph (1) shall include an analysis of--
            </DELETED>
                    <DELETED>    (A) the extent to which the emission
                    reductions required under this Act are being
                    achieved;</DELETED>
                    <DELETED>    (B) the extent to which the emission
                    reductions achieved under this Act, taken together with
                    actual steps taken by other countries to reduce
                    greenhouse gas emissions, is predicted to stabilize
                    atmospheric greenhouse gas concentrations at a level
                    adequate to forestall dangerous anthropogenic
                    interference with the climate system;</DELETED>
                    <DELETED>    (C) whether an increase of global average
                    temperature in excess of 3.6 degrees Fahrenheit (2
                    degrees Celsius) above the preindustrial average has
                    occurred or is more likely than not to occur in the
                    foreseeable future as a result of anthropogenic climate
                    change;</DELETED>
                    <DELETED>    (D)(i) predicted changes in ocean acidity,
                    the extent of coral reefs, and other indicators of
                    ocean ecosystem health due to anthropogenic carbon
                    dioxide; and</DELETED>
                    <DELETED>    (ii) any additional actions that should be
                    taken by the United States or other countries to
                    protect the health of the oceans;</DELETED>
                    <DELETED>    (E) the status of the best available
                    science and the status of technologies to reduce,
                    sequester, or avoid greenhouse gas emissions;</DELETED>
                    <DELETED>    (F) whether the percentage of allowances
                    for any calendar year that are auctioned, allocated, or
                    devoted to other purposes under this Act should be
                    modified;</DELETED>
                    <DELETED>    (G) the effectiveness of auction revenues
                    in meeting the stated purposes of this Act;
                    and</DELETED>
                    <DELETED>    (H) whether additional measures, including
                    an increase in the earned income tax credit, a
                    reduction in payroll taxes, or the implementation of
                    electronic benefit transfers by State health and human
                    services agencies to reach low-income individuals who
                    are not required to file Federal income tax returns,
                    are needed to help low- and moderate-income individuals
                    respond to changes in the cost of energy-related goods
                    and services.</DELETED>
    <DELETED>    (b) Technology Reports.--</DELETED>
            <DELETED>    (1) Definition.--In this subsection, the term
            ``technologically infeasible,'' with respect to a technology,
            means that the technology--</DELETED>
                    <DELETED>    (A) will not be demonstrated beyond
                    laboratory-scale conditions;</DELETED>
                    <DELETED>    (B) would be unsafe;</DELETED>
                    <DELETED>    (C) would not reliably reduce greenhouse
                    gas emissions; or</DELETED>
                    <DELETED>    (D) would prevent the activity to which
                    the technology applies from meeting or performing the
                    primary purpose of the activity (such as generating
                    electricity or transporting goods or
                    individuals).</DELETED>
            <DELETED>    (2) Reports.--Not later than 180 days after the
            date of enactment of this Act, the Administrator shall offer to
            enter into a contract with the National Academy of Sciences
            under which the Academy, not later than 2 years after the date
            of enactment of this Act and every 3 years thereafter, shall
            submit to Congress and the Administrator a report that
            describes or analyzes--</DELETED>
                    <DELETED>    (A) the status of current greenhouse gas
                    emission reduction technologies, including--</DELETED>
                            <DELETED>    (i) technologies for capture and
                            disposal of greenhouse gases;</DELETED>
                            <DELETED>    (ii) efficiency improvement
                            technologies;</DELETED>
                            <DELETED>    (iii) zero-greenhouse gas emitting
                            energy technologies; and</DELETED>
                            <DELETED>    (iv) above- and below-ground
                            biological sequestration
                            technologies;</DELETED>
                    <DELETED>    (B) whether the requirements of this Act
                    (including regulations promulgated under this Act)--
                    </DELETED>
                            <DELETED>    (i) promote the development and
                            deployment of greenhouse gas emission reduction
                            technologies; or</DELETED>
                            <DELETED>    (ii) mandate a level of emission
                            control or reduction that, based on available
                            or expected technology, will be technologically
                            infeasible at the time at which the
                            requirements become effective;</DELETED>
                    <DELETED>    (C) the projected date on which any
                    technology determined to be technologically infeasible
                    will become technologically feasible;</DELETED>
                    <DELETED>    (D) whether any technology determined to
                    be technologically infeasible cannot reasonably be
                    expected to become technologically feasible prior to
                    calendar year 2050; and</DELETED>
                    <DELETED>    (E) the costs of available alternative
                    greenhouse gas emission reduction strategies that could
                    be used or pursued in lieu of any technologies that are
                    determined to be technologically infeasible.</DELETED>

    <DELETED>SEC. 7002. TRANSPORTATION SECTOR REVIEW.</DELETED>

    <DELETED>    (a) Review.--Not later than January 1, 2010, the
    Administrator shall conduct a comprehensive review and analysis to
    determine whether any of the following have occurred:</DELETED>
            <DELETED>    (1)(A) The motor vehicle fuel and motor vehicle
            and nonroad regulations within the scope of Executive Order
            13432 (72 Fed. Reg. 27717; relating to cooperation among
            agencies in protecting the environment with respect to
            greenhouse gas emissions from motor vehicles, nonroad vehicles,
            and nonroad engines) have been finalized and implemented by
            Federal agencies and departments.</DELETED>
            <DELETED>    (B) Any other transportation-related programs,
            including corporate average fuel economy standard reform,
            greenhouse gas vehicle emissions standards, renewable fuel
            volume mandates, low carbon fuel standards, and activities to
            reduce vehicle miles traveled have been finalized and
            implemented by a Federal agency or department.</DELETED>
            <DELETED>    (2) Any regulation or program described in
            paragraph (1) is expected to achieve at least 1 of the
            following, as compared to the baseline greenhouse gas emissions
            consistent with the reference case contained in the report of
            the Energy Information Administration entitled ``Annual Energy
            Outlook 2006'':</DELETED>
                    <DELETED>    (A) At least a 6.2-percent reduction in
                    cumulative greenhouse gas emissions from the light-duty
                    motor vehicle sector, including light-duty vehicles and
                    light-duty trucks, during the period beginning on
                    January 1, 2010, and ending on December 31,
                    2020.</DELETED>
                    <DELETED>    (B) A cumulative reduction of
                    approximately 1,140,000 metric tons of carbon dioxide
                    equivalent, measured on a full fuel cycle
                    basis.</DELETED>
    <DELETED>    (b) Report.--If the Administrator determines that a
    reduction described in subsection (a)(2)(A) will not be achieved, the
    Administrator shall submit to Congress, not later than January 1, 2010,
    a report describing--</DELETED>
            <DELETED>    (1) any additional action of the Administrator
            that will be necessary to reduce greenhouse gas emissions from
            the light-duty motor vehicle sector; and</DELETED>
            <DELETED>    (2) recommendations of the Administrator with
            respect to actions that could be established by Congress to
            ensure that the United States transportation sector will
            achieve--</DELETED>
                    <DELETED>    (A) the reductions described in subsection
                    (a)(2)(B); and</DELETED>
                    <DELETED>    (B) any additional reductions necessary
                    for that sector to assume an equitable share of
                    responsibility for reducing greenhouse gas
                    emissions.</DELETED>

    <DELETED>SEC. 7003. ADAPTATION REVIEW.</DELETED>

    <DELETED>    (a) Regional Estimates.--</DELETED>
            <DELETED>    (1) Estimates.--</DELETED>
                    <DELETED>    (A) In general.--The Administrator, in
                    consultation with the officials described in paragraph
                    (2) and relevant State agencies, shall conduct 6
                    regional infrastructure cost assessments in various
                    regions of the United States, and a national cost
                    assessment, to provide estimates of the range of costs
                    that should be anticipated for adaptation to the
                    impacts of climate change.</DELETED>
                    <DELETED>    (B) Various probabilities.--The
                    Administrator shall develop the estimates under
                    subparagraph (A) for low, medium, and high
                    probabilities of climate change and the potential
                    impacts of climate change.</DELETED>
            <DELETED>    (2) Description of officials.--The officials
            referred to in paragraph (1) are--</DELETED>
                    <DELETED>    (A) the Secretary of
                    Agriculture;</DELETED>
                    <DELETED>    (B) the Secretary of Commerce;</DELETED>
                    <DELETED>    (C) the Secretary of Defense;</DELETED>
                    <DELETED>    (D) the Secretary of Energy;</DELETED>
                    <DELETED>    (E) the Secretary of Health and Human
                    Services;</DELETED>
                    <DELETED>    (F) the Secretary of Homeland
                    Security;</DELETED>
                    <DELETED>    (G) the Secretary of Housing and Urban
                    Development;</DELETED>
                    <DELETED>    (H) the Secretary of the
                    Interior;</DELETED>
                    <DELETED>    (I) the Secretary of
                    Transportation;</DELETED>
                    <DELETED>    (J) the Director of United States
                    Geological Survey; and</DELETED>
                    <DELETED>    (K) the heads of such other Federal
                    agencies and departments as the Administrator
                    determines to be necessary.</DELETED>
            <DELETED>    (3) Submission to congress.--Not later than 1 year
            after the date of enactment of this Act, the Administrator
            shall submit to Congress a report describing the results of the
            assessments conducted under this subsection.</DELETED>
    <DELETED>    (b) Adaptation Plan.--</DELETED>
            <DELETED>    (1) In general.--Not later than 180 days after the
            date of enactment of this Act, the Administrator shall submit
            to Congress a climate change adaptation plan for the United
            States, based on--</DELETED>
                    <DELETED>    (A) assessments performed by the United
                    Nations Intergovernmental Panel on Climate Change in
                    accordance with the Global Change Research Act of 1990
                    (15 U.S.C. 2921 et seq.); and</DELETED>
                    <DELETED>    (B) any other scientific, peer-reviewed
                    regional assessments.</DELETED>
            <DELETED>    (2) Inclusions.--The adaptation plan under
            paragraph (1) shall include--</DELETED>
                    <DELETED>    (A) a prioritized list of vulnerable
                    systems and regions in the United States;</DELETED>
                    <DELETED>    (B) requirements for coordination between
                    Federal, State, and local governments to ensure that
                    key public infrastructure, safety, health, and land use
                    planning and control issues are addressed;</DELETED>
                    <DELETED>    (C) requirements for coordination among
                    the Federal Government, industry, and
                    communities;</DELETED>
                    <DELETED>    (D) an assessment of climate change
                    science research needs, including probabilistic
                    assessments as an aid to planning;</DELETED>
                    <DELETED>    (E) an assessment of climate change
                    technology needs; and</DELETED>
                    <DELETED>    (F) regional and national cost assessments
                    for the range of costs that should be anticipated for
                    adapting to the impacts of climate change.</DELETED>
    <DELETED>    (c) Impacts of Climate Change on Low-Income Populations.--
    </DELETED>
            <DELETED>    (1) In general.--The Administrator shall conduct
            research on the impact of climate change on low-income
            populations in all countries, including--</DELETED>
                    <DELETED>    (A) an assessment of the adverse impact of
                    climate change on--</DELETED>
                            <DELETED>    (i) low-income populations in the
                            United States; and</DELETED>
                            <DELETED>    (ii) developing
                            countries;</DELETED>
                    <DELETED>    (B)(i) an identification of appropriate
                    climate change adaptation measures and programs for
                    developing countries and low-income
                    populations;</DELETED>
                    <DELETED>    (ii) an assessment of the impact of the
                    measures and programs on low-income populations;
                    and</DELETED>
                    <DELETED>    (C) an estimate of the costs of developing
                    and implementing those climate change adaptation and
                    mitigation programs.</DELETED>
            <DELETED>    (2) Report.--Not later than 1 year after the date
            of enactment of this Act, the Administrator shall submit to
            Congress a report describing the results of the research
            conducted under paragraph (1).</DELETED>

     <DELETED>TITLE VIII--FRAMEWORK FOR GEOLOGICAL SEQUESTRATION OF CARBON
                               DIOXIDE</DELETED>

    <DELETED>SEC. 8001. NATIONAL DRINKING WATER REGULATIONS.</DELETED>

    <DELETED>    (a) In General.--Section 1421 of the Safe Drinking Water
    Act (42 U.S.C. 300h) is amended--</DELETED>
            <DELETED>    (1) in subsection (b)(1), by striking ``subsection
            (d)(2)'' and inserting ``subsection (e)(2)'';</DELETED>
            <DELETED>    (2) by redesignating subsection (d) as subsection
            (e); and</DELETED>
            <DELETED>    (3) by inserting after subsection (c) the
            following:</DELETED>
    <DELETED>    ``(d) Carbon Dioxide.--</DELETED>
            <DELETED>    ``(1) Regulations.--Not later than 1 year after
            the date of enactment of the America's Climate Security Act of
            2007, the Administrator shall promulgate regulations for
            permitting commercial-scale underground injection of carbon
            dioxide for purposes of geological sequestration to address
            climate change, including provisions--</DELETED>
                    <DELETED>    ``(A) for monitoring and controlling the
                    long-term storage of carbon dioxide and avoiding, to
                    the maximum extent practicable, any release of carbon
                    dioxide into the atmosphere, and for ensuring
                    protection of underground sources of drinking water,
                    human health, and the environment; and</DELETED>
                    <DELETED>    ``(B) relating to long-term liability
                    associated with commercial-scale geological
                    sequestration.</DELETED>
            <DELETED>    ``(2) Subsequent reports.--Not later than 5 years
            after the date on which regulations are promulgated pursuant to
            paragraph (1), and not less frequently than once every 5 years
            thereafter, the Administrator shall submit to Congress a report
            that contains an evaluation of the effectiveness of the
            regulations, based on current knowledge and experience, with
            particular emphasis on any new information on potential impacts
            of commercial-scale geological sequestration on drinking water,
            human health, and the environment.</DELETED>
            <DELETED>    ``(3) Revision.--If the Administrator determines,
            based on a report under paragraph (2), that regulations
            promulgated pursuant to paragraph (1) require revision, the
            Administrator shall promulgate revised regulations not later
            than 1 year after the date on which the applicable report is
            submitted to Congress under paragraph (2).''.</DELETED>
    <DELETED>    (b) Conforming Amendment.--Section 1447(a)(4) of the Safe
    Drinking Water Act (42 U.S.C. 300j-6(a)(4)) is amended by striking
    ``section 1421(d)(2)'' and inserting ``section 1421(e)(2)''.</DELETED>

    <DELETED>SEC. 8002. ASSESSMENT OF GEOLOGICAL STORAGE CAPACITY FOR
                  CARBON DIOXIDE.</DELETED>

    <DELETED>    (a) Definitions.--In this section:</DELETED>
            <DELETED>    (1) Assessment.--The term ``assessment'' means the
            national assessment of capacity for carbon dioxide completed
            under subsection (f).</DELETED>
            <DELETED>    (2) Capacity.--The term ``capacity'' means the
            portion of a storage formation that can retain carbon dioxide
            in accordance with the requirements (including physical,
            geological, and economic requirements) established under the
            methodology developed under subsection (b).</DELETED>
            <DELETED>    (3) Engineered hazard.--The term ``engineered
            hazard'' includes the location and completion history of any
            well that could affect a storage formation or
            capacity.</DELETED>
            <DELETED>    (4) Risk.--The term ``risk'' includes any risk
            posed by a geomechanical, geochemical, hydrogeological,
            structural, or engineered hazard.</DELETED>
            <DELETED>    (5) Secretary.--The term ``Secretary'' means the
            Secretary of the Interior, acting through the Director of the
            United States Geological Survey.</DELETED>
            <DELETED>    (6) Storage formation.--The term ``storage
            formation'' means a deep saline formation, unmineable coal
            seam, or oil or gas reservoir that is capable of accommodating
            a volume of industrial carbon dioxide.</DELETED>
    <DELETED>    (b) Methodology.--Not later than 1 year after the date of
    enactment of this Act, the Secretary shall develop a methodology for
    conducting an assessment under subsection (f), taking into
    consideration--</DELETED>
            <DELETED>    (1) the geographical extent of all potential
            storage formations in all States;</DELETED>
            <DELETED>    (2) the capacity of the potential storage
            formations;</DELETED>
            <DELETED>    (3) the injectivity of the potential storage
            formations;</DELETED>
            <DELETED>    (4) an estimate of potential volumes of oil and
            gas recoverable by injection and storage of industrial carbon
            dioxide in potential storage formations;</DELETED>
            <DELETED>    (5) the risk associated with the potential storage
            formations; and</DELETED>
            <DELETED>    (6) the work performed to develop the Carbon
            Sequestration Atlas of the United States and Canada completed
            by the Department of Energy in April 2006.</DELETED>
    <DELETED>    (c) Coordination.--</DELETED>
            <DELETED>    (1) Federal coordination.--</DELETED>
                    <DELETED>    (A) Consultation.--The Secretary shall
                    consult with the Secretary of Energy and the
                    Administrator regarding data sharing and the format,
                    development of methodology, and content of the
                    assessment to ensure the maximum usefulness and success
                    of the assessment.</DELETED>
                    <DELETED>    (B) Cooperation.--The Secretary of Energy
                    and the Administrator shall cooperate with the
                    Secretary to ensure, to the maximum extent practicable,
                    the usefulness and success of the assessment.</DELETED>
            <DELETED>    (2) State coordination.--The Secretary shall
            consult with State geological surveys and other relevant
            entities to ensure, to the maximum extent practicable, the
            usefulness and success of the assessment.</DELETED>
    <DELETED>    (d) External Review and Publication.--On completion of the
    methodology under subsection (b), the Secretary shall--</DELETED>
            <DELETED>    (1) publish the methodology and solicit comments
            from the public and the heads of affected Federal and State
            agencies;</DELETED>
            <DELETED>    (2) establish a panel of individuals with
            expertise in the matters described in paragraphs (1) through
            (5) of subsection (b) composed, as appropriate, of
            representatives of Federal agencies, institutions of higher
            education, nongovernmental organizations, State organizations,
            industry, and international geosciences organizations to review
            the methodology and comments received under paragraph (1);
            and</DELETED>
            <DELETED>    (3) on completion of the review under paragraph
            (2), publish in the Federal Register the revised final
            methodology.</DELETED>
    <DELETED>    (e) Periodic Updates.--The methodology developed under
    this section shall be updated periodically (including not less
    frequently than once every 5 years) to incorporate new data as the data
    becomes available.</DELETED>
    <DELETED>    (f) National Assessment.--</DELETED>
            <DELETED>    (1) In general.--Not later than 2 years after the
            date of publication of the methodology under subsection (d)(3),
            the Secretary, in consultation with the Secretary of Energy and
            State geological surveys, shall complete a national assessment
            of the capacity for carbon dioxide storage in accordance with
            the methodology.</DELETED>
            <DELETED>    (2) Geological verification.--As part of the
            assessment, the Secretary shall carry out a drilling program to
            supplement the geological data relevant to determining storage
            capacity in carbon dioxide in geological storage formations,
            including--</DELETED>
                    <DELETED>    (A) well log data;</DELETED>
                    <DELETED>    (B) core data; and</DELETED>
                    <DELETED>    (C) fluid sample data.</DELETED>
            <DELETED>    (3) Partnership with other drilling programs.--As
            part of the drilling program under paragraph (2), the Secretary
            shall enter into partnerships, as appropriate, with other
            entities to collect and integrate data from other drilling
            programs relevant to the storage of carbon dioxide in geologic
            formations.</DELETED>
            <DELETED>    (4) Incorporation into natcarb.--</DELETED>
                    <DELETED>    (A) In general.--On completion of the
                    assessment, the Secretary shall incorporate the results
                    of the assessment using, to the maximum extent
                    practicable--</DELETED>
                            <DELETED>    (i) the NatCarb database;
                            or</DELETED>
                            <DELETED>    (ii) a new database developed by
                            the Secretary, as the Secretary determines to
                            be necessary.</DELETED>
                    <DELETED>    (B) Ranking.--The database shall include
                    the data necessary to rank potential storage sites--
                    </DELETED>
                            <DELETED>    (i) for capacity and
                            risk;</DELETED>
                            <DELETED>    (ii) across the United
                            States;</DELETED>
                            <DELETED>    (iii) within each State;</DELETED>
                            <DELETED>    (iv) by formation; and</DELETED>
                            <DELETED>    (v) within each basin.</DELETED>
            <DELETED>    (5) Report.--Not later than 180 days after the
            date on which the assessment is completed, the Secretary shall
            submit to the Committee on Energy and Natural Resources of the
            Senate and the Committee on Science and Technology of the House
            of Representatives a report describing the results of the
            assessment.</DELETED>
            <DELETED>    (6) Periodic updates.--The assessment shall be
            updated periodically (including not less frequently than once
            every 5 years) as necessary to support public and private
            sector decisionmaking, as determined by the
            Secretary.</DELETED>

    <DELETED>SEC. 8003. STUDY OF THE FEASIBILITY RELATING TO CONSTRUCTION
                  OF PIPELINES AND GEOLOGICAL CARBON DIOXIDE SEQUESTRATION
                  ACTIVITIES.</DELETED>

    <DELETED>    (a) In General.--The Secretary of Energy, in coordination
    with the Administrator, the Federal Energy Regulatory Commission, the
    Secretary of Transportation, and the Secretary of the Interior, shall
    conduct a study to assess the feasibility of the construction of--
    </DELETED>
            <DELETED>    (1) pipelines to be used for the transportation of
            carbon dioxide for the purpose of sequestration or enhanced oil
            recovery; and</DELETED>
            <DELETED>    (2) geological carbon dioxide sequestration
            facilities.</DELETED>
    <DELETED>    (b) Scope.--The study shall consider--</DELETED>
            <DELETED>    (1) any barrier or potential barrier in existence
            as of the date of enactment of this Act, including any
            technical, siting, financing, or regulatory barrier, relating
            to--</DELETED>
                    <DELETED>    (A) the construction of pipelines to be
                    used for the transportation of carbon dioxide for the
                    purpose of sequestration or enhanced oil recovery;
                    or</DELETED>
                    <DELETED>    (B) the geological sequestration of carbon
                    dioxide;</DELETED>
            <DELETED>    (2) any market risk (including throughput risk)
            relating to--</DELETED>
                    <DELETED>    (A) the construction of pipelines to be
                    used for the transportation of carbon dioxide for the
                    purpose of sequestration or enhanced oil recovery;
                    or</DELETED>
                    <DELETED>    (B) the geological sequestration of carbon
                    dioxide;</DELETED>
            <DELETED>    (3) any regulatory, financing, or siting option
            that, as determined by the Secretary of Energy, would--
            </DELETED>
                    <DELETED>    (A) mitigate any market risk described in
                    paragraph (2); or</DELETED>
                    <DELETED>    (B) help ensure the construction of
                    pipelines dedicated to the transportation of carbon
                    dioxide for the purpose of sequestration or enhanced
                    oil recovery;</DELETED>
            <DELETED>    (4) the means by which to ensure the safe handling
            and transportation of carbon dioxide;</DELETED>
            <DELETED>    (5) any preventive measure to ensure the
            integration of pipelines to be used for the transportation of
            carbon dioxide for the purpose of sequestration or enhanced oil
            recovery; and</DELETED>
            <DELETED>    (6) any other appropriate use, as determined by
            the Secretary of Energy, in coordination with the
            Administrator, the Federal Energy Regulatory Commission, the
            Secretary of Transportation, and the Secretary of the
            Interior.</DELETED>
    <DELETED>    (c) Report.--Not later than 180 days after the date of
    enactment of this Act, the Secretary of Energy shall submit to the
    Congress a report describing the results of the study.</DELETED>

    <DELETED>SEC. 8004. LIABILITIES FOR CLOSED GEOLOGICAL STORAGE
                  SITES.</DELETED>

    <DELETED>    (a) Establishment of Task Force.--As soon as practicable
    after the date of enactment of this Act, the Administrator shall
    establish a task force, to be composed of an equal number of
    stakeholders, the public, subject matter experts, and members of the
    private sector, to conduct a study of the legal framework,
    environmental and safety considerations, and cost implications of
    potential Federal assumption of liability with respect to closed
    geological storage sites.</DELETED>
    <DELETED>    (b) Report.--Not later than 18 months after the date of
    enactment of this Act, the task force established under subsection (a)
    shall submit to Congress a report describing the results of the study
    conducted under subsection (a), including recommendations of the task
    force, if any, with respect to the framework described in that
    subsection.</DELETED>

                   <DELETED>TITLE IX--MISCELLANEOUS</DELETED>

    <DELETED>SEC. 9001. PARAMOUNT INTEREST WAIVER.</DELETED>

    <DELETED>    (a) In General.--If the President determines that a
    national security emergency exists and, in light of information that
    was not available as of the date of enactment of this Act, it is in the
    paramount interest of the United States to modify any requirement under
    this Act to minimize the effects of the emergency, the President may,
    after opportunity for public notice and comment, temporarily adjust,
    suspend, or waive any regulations promulgated pursuant to this Act to
    achieve that minimization.</DELETED>
    <DELETED>    (b) Consultation.--In making an emergency determination
    under subsection (a), the President shall, to the maximum extent
    practicable, consult with and take into account any advice received
    from--</DELETED>
            <DELETED>    (1) the National Academy of Sciences;</DELETED>
            <DELETED>    (2) the Secretary of Energy; and</DELETED>
            <DELETED>    (3) the Administrator.</DELETED>
    <DELETED>    (c) Judicial Review.--An emergency determination under
    subsection (a) shall be subject to judicial review in accordance with
    section 307 of the Clean Air Act (42 U.S.C. 7607).</DELETED>

    <DELETED>SEC. 9002. CORPORATE ENVIRONMENTAL DISCLOSURE OF CLIMATE
                  CHANGE RISKS.</DELETED>

    <DELETED>    (a) Regulations.--Not later than 2 years after the date of
    enactment of this Act, the Securities and Exchange Commission (referred
    to in this section as the ``Commission'') shall promulgate regulations
    in accordance with section 13 of the Securities Exchange Act of 1934
    (15 U.S.C. 78m) directing each issuer of securities under that Act, to
    inform, based on the current expectations and projections and knowledge
    of facts of the issuer, securities investors of material risks relating
    to--</DELETED>
            <DELETED>    (1) the financial exposure of the issuer because
            of the net global warming pollution emissions of the issuer;
            and</DELETED>
            <DELETED>    (2) the potential economic impacts of global
            warming on the interests of the issuer.</DELETED>
    <DELETED>    (b) Uniform Format for Disclosure.--In carrying out
    subsection (a), the Commission shall enter into an agreement with the
    Financial Accounting Standards Board, or another appropriate
    organization that establishes voluntary standards, to develop a uniform
    format for disclosing to securities investors information on the risks
    described in subsection (a).</DELETED>
    <DELETED>    (c) Interim Interpretive Release.--</DELETED>
            <DELETED>    (1) In general.--Not later than 1 year after the
            date of enactment of this Act, the Commission shall issue an
            interpretive release clarifying that under items 101 and 303 of
            Regulation S-K of the Commission under part 229 of title 17,
            Code of Federal Regulations (as in effect on the date of
            enactment of this Act)--</DELETED>
                    <DELETED>    (A) the commitments of the United States
                    to reduce emissions of global warming pollution under
                    the United Nations Framework Convention on Climate
                    Change, done at New York on May 9, 1992, are considered
                    to be a material effect; and</DELETED>
                    <DELETED>    (B) global warming constitutes a known
                    trend.</DELETED>
            <DELETED>    (2) Period of effectiveness.--The interpretive
            release issued under paragraph (1) shall remain in effect until
            the effective date of the final regulations promulgated under
            subsection (a).</DELETED>

    <DELETED>SEC. 9003. ADMINISTRATIVE PROCEDURE AND JUDICIAL
                  REVIEW.</DELETED>

    <DELETED>    (a) Rulemaking Procedures.--Any rule, requirement,
    regulation, method, standard, program, determination, or final action
    made or promulgated pursuant to any title of this Act, with the
    exception of sections 3101, 3201, 3301, and 3901, shall be subject to
    the rulemaking procedures described in sections 551 through 557 of
    title 5, United States Code.</DELETED>
    <DELETED>    (b) Enforcement.--Each provision of this Act (including
    provisions relating to mandatory duties of the Administrator) shall be
    fully enforceable pursuant to sections 113, 303, and 304 of the Clean
    Air Act (42 U.S.C. 7413, 7603, 7604).</DELETED>
    <DELETED>    (c) Recordkeeping, Inspections, Monitoring, Entry, and
    Subpoenas.--The Administrator shall have the same powers and authority
    provided under sections 114 and 307(a) of the Clean Air Act (42 U.S.C.
    7414, 7607(a)) in carrying out, administering, and enforcing this
    Act.</DELETED>
    <DELETED>    (d) Judicial Review.--A petition for judicial review of
    any regulation promulgated, or final action carried out, by the
    Administrator pursuant to this Act may be filed only--</DELETED>
            <DELETED>    (1) in the United States Court of Appeals for the
            District of Columbia; and</DELETED>
            <DELETED>    (2) in accordance with section 307(b) of the Clean
            Air Act (42 U.S.C. 7607(b)).</DELETED>

    <DELETED>SEC. 9004. RETENTION OF STATE AUTHORITY.</DELETED>

    <DELETED>    (a) In General.--Except as provided in subsection (b), in
    accordance with section 116 of the Clean Air Act (42 U.S.C. 7416) and
    section 510 of the Federal Water Pollution Control Act (33 U.S.C.
    1370), nothing in this Act precludes or abrogates the right of any
    State to adopt or enforce--</DELETED>
            <DELETED>    (1) any standard, cap, limitation, or prohibition
            relating to emissions of greenhouse gas; or</DELETED>
            <DELETED>    (2) any requirement relating to control,
            abatement, or avoidance of emissions of greenhouse
            gas.</DELETED>
    <DELETED>    (b) Exception.--Notwithstanding subsection (a), no State
    may adopt a standard, cap, limitation, prohibition, or requirement that
    is less stringent than the applicable standard, cap, limitation,
    prohibition, or requirement under this Act.</DELETED>

    <DELETED>SEC. 9005. TRIBAL AUTHORITY.</DELETED>

    <DELETED>    For purposes of this Act, the Administrator may treat any
    federally recognized Indian tribe as a State, in accordance with
    section 301(d) of the Clean Air Act (42 U.S.C. 7601(d)).</DELETED>

    <DELETED>SEC. 9006. AUTHORIZATION OF APPROPRIATIONS.</DELETED>

    <DELETED>    There are authorized to be appropriated such sums as are
    necessary to carry out this Act.</DELETED>

    SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

        (a) Short Title.--This Act may be cited as the ``Lieberman-Warner
    Climate Security Act of 2007''.
        (b) Table of Contents.--The table of contents of this Act is as
    follows:

    Sec. 1. Short title; table of contents.
    Sec. 2. Findings.
    Sec. 3. Purposes.
    Sec. 4. Definitions.

                   TITLE I--CAPPING GREENHOUSE GAS EMISSIONS

                         Subtitle A--Tracking Emissions

    Sec. 1101. Purpose.
    Sec. 1102. Definitions.
    Sec. 1103. Reporting requirements.
    Sec. 1104. Data quality and verification.
    Sec. 1105. Federal greenhouse gas registry.
    Sec. 1106. Enforcement.

                         Subtitle B--Reducing Emissions

    Sec. 1201. Emission allowance account.
    Sec. 1202. Compliance obligation.
    Sec. 1203. Penalty for noncompliance.
    Sec. 1204. Rulemaking.

              TITLE II--MANAGING AND CONTAINING COSTS EFFICIENTLY

                              Subtitle A--Trading

    Sec. 2101. Sale, exchange, and retirement of emission allowances.
    Sec. 2102. No restriction on transactions.
    Sec. 2103. Allowance transfer system.
    Sec. 2104. Allowance tracking system.

                              Subtitle B--Banking

    Sec. 2201. Indication of calendar year.
    Sec. 2202. Effect of time.

                             Subtitle C--Borrowing

    Sec. 2301. Regulations.
    Sec. 2302. Term.
    Sec. 2303. Repayment with interest.

                              Subtitle D--Offsets

    Sec. 2401. Outreach initiative on revenue enhancement for agricultural
                                producers.
    Sec. 2402. Establishment of domestic offset program.
    Sec. 2403. Eligible offset project types.
    Sec. 2404. Project initiation and approval.
    Sec. 2405. Offset verification and issuance of allowances.
    Sec. 2406. Tracking of reversals for sequestration projects.
    Sec. 2407. Examinations.
    Sec. 2408. Timing and the provision of offset allowances.
    Sec. 2409. Offset registry.
    Sec. 2410. Environmental considerations.
    Sec. 2411. Program review.
    Sec. 2412. Retail carbon offsets.

                 Subtitle E--International Emission Allowances

    Sec. 2501. Use of international emission allowances.
    Sec. 2502. Regulations.
    Sec. 2503. Facility certification.

                   Subtitle F--Carbon Market Efficiency Board

    Sec. 2601. Purposes.
    Sec. 2602. Establishment of Carbon Market Efficiency Board.
    Sec. 2603. Duties.
    Sec. 2604. Powers.
    Sec. 2605. Estimate of costs to economy of limiting greenhouse gas
                                emissions.

               TITLE III--ALLOCATING AND DISTRIBUTING ALLOWANCES

                              Subtitle A--Auctions

    Sec. 3101. Allocation for early auctions.
    Sec. 3102. Allocation for annual auctions.

                            Subtitle B--Early Action

    Sec. 3201. Allocation.
    Sec. 3202. Distribution.

                               Subtitle C--States

    Sec. 3301. Allocation for energy savings.
    Sec. 3302. Allocation for States with programs that exceed Federal
                                emission reduction targets.
    Sec. 3303. General allocation.
    Sec. 3304. Allocation for mass transit.

                       Subtitle D--Electricity Consumers

    Sec. 3401. Allocation.
    Sec. 3402. Distribution.
    Sec. 3403. Use.
    Sec. 3404. Reporting.

                       Subtitle E--Natural Gas Consumers

    Sec. 3501. Allocation.
    Sec. 3502. Distribution.
    Sec. 3503. Use.
    Sec. 3504. Reporting.

        Subtitle F--Bonus Allowances for Carbon Capture and Geological
                                 Sequestration

    Sec. 3601. Allocation.
    Sec. 3602. Qualifying projects.
    Sec. 3603. Distribution.
    Sec. 3604. 10-Year limit.
    Sec. 3605. Exhaustion of bonus allowance account.

                 Subtitle G--Domestic Agriculture and Forestry

    Sec. 3701. Allocation.
    Sec. 3702. Agricultural and forestry greenhouse gas management
                                research.
    Sec. 3703. Distribution.

                  Subtitle H--International Forest Protection

    Sec. 3801. Findings.
    Sec. 3802. Definition of forest carbon activities.
    Sec. 3803. Allocation.
    Sec. 3804. Definition and eligibility requirements.
    Sec. 3805. International forest carbon activities.
    Sec. 3806. Reviews and discount.

                       Subtitle I--Transition Assistance

    Sec. 3901. General allocation and distribution.
    Sec. 3902. Distributing emission allowances to owners and operators of
                                fossil fuel-fired electric power generating
                                facilities.
    Sec. 3903. Distributing additional emission allowances to rural
                                electric cooperatives.
    Sec. 3904. Distributing emission allowances to owners and operators of
                                energy intensive manufacturing facilities.
    Sec. 3905. Distributing emission allowances to owners and operators of
                                facilities and other entities that produce
                                or import petroleum-based fuel.
    Sec. 3906. Distributing emission allowances to hydrofluorocarbon
                                producers and importers.

      Subtitle J--Reducing Methane Emissions From Landfills and Coal Mines

    Sec. 3907. Allocation.
    Sec. 3908. Distribution.

                TITLE IV--AUCTIONS AND USES OF AUCTION PROCEEDS

                               Subtitle A--Funds

    Sec. 4101. Establishment.
    Sec. 4102. Amounts in Funds.

                 Subtitle B--Climate Change Credit Corporation

    Sec. 4201. Establishment.
    Sec. 4202. Applicable laws.
    Sec. 4203. Board of directors.
    Sec. 4204. Review and audit by Comptroller General.

                              Subtitle C--Auctions

    Sec. 4301. Early auctions.
    Sec. 4302. Annual auctions.

                    Subtitle D--Energy Technology Deployment

    Sec. 4401. General allocations.
    Sec. 4402. Zero- or low-carbon energy technologies deployment.
    Sec. 4403. Advanced coal and sequestration technologies program.
    Sec. 4404. Fuel from cellulosic biomass.
    Sec. 4405. Advanced technology vehicles manufacturing incentive
                                program.
    Sec. 4406. Sustainable energy program.

                          Subtitle E--Energy Consumers

    Sec. 4501. Proportions of funding availability.
    Sec. 4502. Rural energy assistance program.

               Subtitle F--Climate Change Worker Training Program

    Sec. 4601. Funding.
    Sec. 4602. Purposes.
    Sec. 4603. Establishment.
    Sec. 4604. Activities.
    Sec. 4605. Worker protections and nondiscrimination requirements.
    Sec. 4606. Workforce training and safety.

     Subtitle G--Adaptation Program for Natural Resources in United States
                                and Territories

    Sec. 4701. Definitions.
    Sec. 4702. Adaptation fund.

       Subtitle H--International Climate Change Adaptation and National
                                Security Program

    Sec. 4801. Findings.
    Sec. 4802. Purposes.
    Sec. 4803. Establishment.
    Sec. 4804. Funding.

                  Subtitle I--Emergency Firefighting Programs

    Sec. 4901. Findings.
    Sec. 4902. Bureau of Land Management emergency firefighting program.
    Sec. 4903. Forest Service emergency firefighting program.

                           TITLE V--ENERGY EFFICIENCY

                        Subtitle A--Appliance Efficiency

    Sec. 5101. Residential boilers.
    Sec. 5102. Regional variations in heating or cooling standards.

                        Subtitle B--Building Efficiency

    Sec. 5201. Updating State building energy efficiency codes.
    Sec. 5202. Conforming amendment.

           TITLE VI--GLOBAL EFFORT TO REDUCE GREENHOUSE GAS EMISSIONS

    Sec. 6001. Definitions.
    Sec. 6002. Purposes.
    Sec. 6003. International negotiations.
    Sec. 6004. Interagency review.
    Sec. 6005. Presidential determinations.
    Sec. 6006. International reserve allowance program.
    Sec. 6007. Adjustment of international reserve allowance requirements.

                     TITLE VII--REVIEWS AND RECOMMENDATIONS

    Sec. 7001. National Academy of Sciences Reviews.
    Sec. 7002. Environmental Protection Agency review.
    Sec. 7003. Environmental Protection Agency recommendations.
    Sec. 7004. Presidential recommendations.
    Sec. 7005. Adaptation assessments and plan.
    Sec. 7006. Study by Administrator of aviation sector greenhouse gas
                                emissions.

      TITLE VIII--FRAMEWORK FOR GEOLOGICAL SEQUESTRATION OF CARBON DIOXIDE

    Sec. 8001. National drinking water regulations.
    Sec. 8002. Assessment of geological storage capacity for carbon
                                dioxide.
    Sec. 8003. Study of the feasibility relating to construction of
                                pipelines and geological carbon dioxide
                                sequestration activities.
    Sec. 8004. Liabilities for closed geological storage sites.

                            TITLE IX--MISCELLANEOUS

    Sec. 9001. Paramount interest waiver.
    Sec. 9002. Administrative procedure and judicial review.
    Sec. 9003. Retention of State authority.
    Sec. 9004. Tribal authority.
    Sec. 9005. Rocky Mountain Centers for Study of Coal Utilization.
    Sec. 9006. Sun grant center research on compliance with Clean Air Act.
    Sec. 9007. Authorization of appropriations.

               TITLE X--CONTROL OF HYDROFLUOROCARBON CONSUMPTION

    Sec. 10001. Applicability.
    Sec. 10002. Definitions.
    Sec. 10003. Cap on hydrofluorocarbon consumption and importation into
                                United States.
    Sec. 10004. Hydrofluorocarbon consumption allowance account.
    Sec. 10005. Allocation of hydrofluorocarbon consumption allowances.
    Sec. 10006. Compliance obligation.
    Sec. 10007. Sale, exchange, and other uses of hydrofluorocarbon
                                consumption allowances.
    Sec. 10008. Allowance transfer system.
    Sec. 10009. Banking and borrowing.
    Sec. 10010. Hydrofluorocarbon destruction allowances.

                     TITLE XI--AMENDMENTS TO CLEAN AIR ACT

    Sec. 11001. National recycling and emission reduction program.
    Sec. 11002. Servicing of motor vehicle air conditioners.
    Sec. 11003. Carbon dioxide reduction.

    SEC. 2. FINDINGS.

        Congress finds that--
                (1) unchecked global warming poses a significant threat
            to--
                        (A) the national security and economy of the United
                    States;
                        (B) public health and welfare in the United States;
                        (C) the well-being of other countries; and
                        (D) the global environment;
                (2) under the United Nations Framework Convention on
            Climate Change, done at New York on May 9, 1992, the United
            States is committed to stabilizing greenhouse gas
            concentrations in the atmosphere at a level that will prevent
            dangerous anthropogenic interference with the climate system;
                (3) according to the Fourth Assessment Report of the
            Intergovernmental Panel on Climate Change, stabilizing
            greenhouse gas concentrations in the atmosphere at a level that
            will prevent dangerous interference with the climate system
            will require a global effort to reduce anthropogenic greenhouse
            gas emissions worldwide by 50 to 85 percent below 2000 levels
            by 2050;
                (4) prompt, decisive action is critical, since global
            warming pollutants can persist in the atmosphere for more than
            a century;
                (5) the ingenuity of the people of the United States will
            allow the United States to become a leader in curbing global
            warming;
                (6) it is possible and desirable to cap greenhouse gas
            emissions, from sources that together account for the majority
            of those emissions in the United States, at or slightly below
            the current level in 2012, and to lower the cap each year
            between 2012 and 2050, on the condition that the system
            includes--
                        (A) cost containment measures;
                        (B) periodic review of requirements;
                        (C) an aggressive program for deploying advanced
                    energy technology;
                        (D) programs to assist low- and middle-income
                    energy consumers; and
                        (E) programs to mitigate the impacts of any
                    unavoidable global climate change;
                (7) Congress may need to update the emissions caps in order
            to account for continuing scientific data and steps taken, or
            not taken, by foreign countries;
                (8) accurate emission data and timely compliance with the
            requirements of the greenhouse gas emission reduction and
            trading program established under this Act are needed to ensure
            that reductions are achieved and to provide equity, efficiency,
            and openness in the market for allowances subject to the
            program;
                (9) additional policies external to a cap-and-trade program
            may be required, including with respect to--
                        (A) the transportation sector, where reducing
                    greenhouse gas emissions requires changes in vehicles,
                    in fuels, and in consumer behavior; and
                        (B) the built environment, where reducing direct
                    and indirect greenhouse gas emissions requires changes
                    in buildings, appliances, lighting, heating, cooling,
                    and consumer behavior;
                (10) significant and sustained domestic investments are
            required to support an aggressive program for developing and
            deploying advanced technologies to reduce greenhouse gas
            emissions;
                (11) all, or virtually all, emissions of greenhouse gases
            from the combustion of natural gas in the United States should
            be reduced through the inclusion in a cap-and-trade system of
            entities that sell natural gas in the United States;
                (12) including natural gas in a cap-and-trade system in the
            United States should be carried out in a way that minimizes, to
            the extent feasible, the number of entities required to submit
            emission allowances for the natural gas sold by the entities;
                (13) including natural gas in a cap-and-trade system in the
            United States promotes substantial reductions in total United
            States greenhouse gas emissions while also minimizing, to the
            extent feasible, the activities within the industrial sector
            that necessitate the submission of emission allowances;
                (14) emissions of sulfur dioxide, nitrogen oxides, and
            mercury to the atmosphere from coal-fired electric power
            generating facilities in the United States inflicts harm on the
            public health, economy, and natural resources of the United
            States;
                (15) fossil fuel-fired electric power generating facilities
            emit approximately 67 percent of the total sulfur dioxide
            emissions, 23 percent of the total nitrogen oxide emissions, 40
            percent of the total carbon dioxide emissions, and 40 percent
            of the total mercury emissions in the United States;
                (16) while the reductions in emissions of sulfur dioxide,
            nitrogen oxides, and mercury that will occur in the presence of
            a declining cap on the greenhouse gas emissions from coal-fired
            electric power generating facilities are larger than those that
            would occur in the absence of such a cap, new, stricter Federal
            limits on emissions of sulfur dioxide, nitrogen oxides, and
            mercury may still be needed to protect public health; and
                (17) many existing fossil fuel-fired electric power
            generating facilities were exempted by Congress from emissions
            limitations applicable to new and modified units based on an
            expectation by Congress that, over time, the units would be
            retired or updated with new pollution control equipment, but
            many of the exempted facilities nevertheless continue to
            operate and emit pollutants at relatively high rates and
            without new pollution control equipment.

    SEC. 3. PURPOSES.

        The purposes of this Act are--
                (1) to establish the core of a Federal program that will
            reduce United States greenhouse gas emissions substantially
            enough between 2007 and 2050 to avert the catastrophic impacts
            of global climate change; and
                (2) to accomplish that purpose while preserving robust
            growth in the United States economy, creating new jobs, and
            avoiding the imposition of hardship on United States citizens.

    SEC. 4. DEFINITIONS.

        In this Act:
                (1) Additional; additionality.--The terms ``additional''
            and ``additionality'' mean the extent to which reductions in
            greenhouse gas emissions or increases in sequestration are
            incremental to business-as-usual, measured as the difference
            between--
                        (A) baseline greenhouse gas fluxes of an offset
                    project; and
                        (B) greenhouse gas fluxes of the offset project.
                (2) Administrator.--The term ``Administrator'' means the
            Administrator of the Environmental Protection Agency.
                (3) Baseline.--The term ``baseline'' means the greenhouse
            gas flux or carbon stock that would have occurred in the
            absence of an offset project.
                (4) Biological sequestration; biologically sequestered.--
            The terms ``biological sequestration'' and ``biologically
            sequestered'' mean--
                        (A) the removal of greenhouse gases from the
                    atmosphere by biological means, such as by growing
                    plants; and
                        (B) the storage of those greenhouse gases in the
                    plants or related soils.
                (5) Carbon dioxide equivalent.--The term ``carbon dioxide
            equivalent'' means, for each greenhouse gas, the quantity of
            the greenhouse gas that the Administrator determines makes the
            same contribution to global warming as 1 metric ton of carbon
            dioxide.
                (6) Corporation.--The term ``Corporation'' means the
            Climate Change Credit Corporation established by section
            4201(a).
                (7) Covered facility.--The term ``covered facility''
            means--
                        (A) any facility that uses more than 5,000 tons of
                    coal in a calendar year;
                        (B) any facility that is a natural gas processing
                    plant or that produces natural gas in the State of
                    Alaska, or any entity that imports natural gas
                    (including liquefied natural gas);
                        (C) any facility that in any year produces, or any
                    entity that in any year imports, petroleum- or coal-
                    based liquid or gaseous fuel, the combustion of which
                    will emit a group I greenhouse gas, assuming no capture
                    and sequestration of that gas;
                        (D) any facility that in any year produces for sale
                    or distribution, or any entity that in any year
                    imports, more than 10,000 carbon dioxide equivalents of
                    chemicals that are group I greenhouse gas, assuming no
                    capture and destruction or sequestration of that gas;
                    or
                        (E) any facility that in any year emits as a
                    byproduct of the production of hydrochlorofluorocarbons
                    more than 10,000 carbon dioxide equivalents of
                    hydrofluorocarbons.
                (8) Destruction.--The term ``destruction'' means the
            conversion of a greenhouse gas by thermal, chemical, or other
            means--
                        (A) to another gas with a low- or zero-global
                    warming potential; and
                        (B) for which credit given reflects the extent of
                    reduction in global warming potential actually
                    achieved.
                (9) Emission allowance.--The term ``emission allowance''
            means an authorization to emit 1 carbon dioxide equivalent of
            greenhouse gas.
                (10) Emission allowance account.--The term ``Emission
            Allowance Account'' means the aggregate of emission allowances
            that the Administrator establishes for a calendar year.
                (11) Facility.--The term ``facility'' means--
                        (A) 1 or more buildings, structures, or
                    installations located on 1 or more contiguous or
                    adjacent properties of an entity in the United States;
                    and
                        (B) at the option of the Administrator, any
                    activity or operation that--
                                (i) emits 10,000 carbon dioxide equivalents
                            in any year; and
                                (ii) has a technical connection with the
                            activities carried out at a facility, such as
                            use of transportation fleets, pipelines,
                            transmission lines, and distribution lines, but
                            that is not conducted or located on the
                            property of the facility.
                (12) Fair market value.--The term ``fair market value''
            means the average market price, in a particular calendar year,
            of an emission allowance.
                (13) Geological sequestration; geologically sequestered.--
            The terms ``geological sequestration'' and ``geologically
            sequestered'' mean the permanent isolation of greenhouse gases,
            without reversal, in geological formations, in accordance with
            part C of the Safe Drinking Water Act (42 U.S.C. 300h et seq.),
            as determined by the Administrator.
                (14) Group i greenhouse gas.----The term ``group I
            greenhouse gas'' means any of--
                        (A) carbon dioxide;
                        (B) methane;
                        (C) nitrous oxide;
                        (D) sulfur hexafluoride; or
                        (E) a perfluorocarbon.
                (15) Group ii greenhouse gas.--The term ``group II
            greenhouse gas'' means a hydrofluorocarbon.
                (16) Leakage.--The term ``leakage'' means--
                        (A) a significant unaccounted increase in
                    greenhouse gas emissions by a facility or entity caused
                    by an offset project that produces an accounted
                    reduction in greenhouse gas emissions, as determined by
                    the Administrator; or
                        (B) a significant unaccounted decrease in
                    sequestration that is caused by an offset project that
                    results in an accounted increase in sequestration, as
                    determined by the Administrator.
                (17) Load-serving entity.--The term ``load-serving entity''
            means an entity, whether public or private--
                        (A) that has a legal, regulatory, or contractual
                    obligation to deliver electricity to retail consumers;
                    and
                        (B) whose rates and costs are, except in the case
                    of a registered electric cooperative, regulated by a
                    State agency, regulatory commission, municipality, or
                    public utility district.
                (18) Natural gas processing plant.--The term ``natural gas
            processing plant'' means a facility in the United States that
            is designed to separate natural gas liquids from natural gas.
                (19) New entrant.--The term ``new entrant'' means any
            facility that commences operation on or after January 1, 2008.
                (20) Offset allowance.--The term ``offset allowance'' means
            a unit of reduction in the quantity of emissions or an increase
            in sequestration equal to 1 carbon dioxide equivalent at an
            entity that is not a covered facility, where the reduction in
            emissions or increase in sequestration is eligible to be used
            as an additional means of compliance for the submission
            requirements established under section 1202.
                (21) Offset project.--The term ``offset project'' means a
            domestic project, other than a project at a covered facility,
            that reduces greenhouse gas emissions or increases terrestrial
            sequestration of carbon dioxide.
                (22) Project developer.--The term ``project developer''
            means an individual or entity implementing an offset project.
                (23) Retail rate for distribution service.--
                        (A) In general.--The term ``retail rate for
                    distribution service'' means the rate that a load-
                    serving entity charges for the use of the system of the
                    load-serving entity.
                        (B) Exclusion.--The term ``retail rate for
                    distribution service'' does not include any energy
                    component of the rate.
                (24) Retire an emission allowance.--The term ``retire an
            emission allowance'' means to disqualify an emission allowance
            for any subsequent use, regardless of whether the use is a
            sale, exchange, or submission of the allowance in satisfying a
            compliance obligation.
                (25) Reversal.--The term ``reversal'' means an intentional
            or unintentional loss of sequestered carbon dioxide to the
            atmosphere in significant quantities, as determined by the
            Administrator, in order to accomplish the purposes of this Act
            in an effective and efficient manner.
                (26) Rural electric cooperative.--The term ``rural electric
            cooperative'' means a cooperatively-owned association that was
            in existence as of October 18, 2007, and is eligible to receive
            loans under section 4 of the Rural Electrification Act of 1936
            (7 U.S.C. 904).
                (27) Sequestered and sequestration.--The terms
            ``sequestered'' and ``sequestration'' mean the capture,
            permanent separation, isolation, or removal of greenhouse gases
            from the atmosphere, as determined by the Administrator.
                (28) State regulatory authority.--The term ``State
            regulatory authority'' means any State agency that has
            ratemaking authority with respect to the retail rate for
            distribution service.

                   TITLE I--CAPPING GREENHOUSE GAS EMISSIONS

                         Subtitle A--Tracking Emissions

    SEC. 1101. PURPOSE.

        The purpose of this subtitle is to establish a Federal greenhouse
    gas registry that--
                (1) is complete, consistent, transparent, and accurate;
                (2) will collect reliable and accurate data that can be
            used by public and private entities to design efficient and
            effective energy security initiatives and greenhouse gas
            emission reduction strategies; and
                (3) will provide appropriate high-quality data to be used
            for implementing greenhouse gas reduction policies.

    SEC. 1102. DEFINITIONS.

        In this subtitle:
                (1) Affected facility.--
                        (A) In general.--The term ``affected facility''
                    means--
                                (i) a covered facility;
                                (ii) another facility that emits a
                            greenhouse gas, as determined by the
                            Administrator; and
                                (iii) at the option of the Administrator, a
                            vehicle fleet with emissions of more than
                            10,000 carbon dioxide equivalents in any year,
                            assuming no double-counting of emissions.
                        (B) Exclusions.--The term ``affected facility''
                    does not include any facility that--
                                (i) is not a covered facility;
                                (ii) is owned or operated by a small
                            business (as described in part 121 of title 13,
                            Code of Federal Regulations (or a successor
                            regulation)); and
                                (iii) emits fewer than 10,000 carbon
                            dioxide equivalents in any year.
                (2) Carbon content.--The term ``carbon content'' means the
            quantity of carbon (in carbon dioxide equivalent) contained in
            a fuel.
                (3) Climate registry.--The term ``Climate Registry'' means
            the greenhouse gas emissions registry jointly established and
            managed by more than 40 States and Indian tribes to collect
            high-quality greenhouse gas emission data from facilities,
            corporations, and other organizations to support various
            greenhouse gas emission reporting and reduction policies for
            the member States and Indian tribes.
                (4) Feedstock fossil fuel.--The term ``feedstock fossil
            fuel'' means fossil fuel used as raw material in a
            manufacturing process.
                (5) Greenhouse gas emissions.--The term ``greenhouse gas
            emissions'' means emissions of a greenhouse gas, including--
                        (A) stationary combustion source emissions emitted
                    as a result of combustion of fuels in stationary
                    equipment, such as boilers, furnaces, burners,
                    turbines, heaters, incinerators, engines, flares, and
                    other similar sources;
                        (B) process emissions consisting of emissions from
                    chemical or physical processes other than combustion;
                        (C) fugitive emissions consisting of intentional
                    and unintentional emissions from equipment leaks, such
                    as joints, seals, packing, and gaskets, or from piles,
                    pits, cooling towers, and other similar sources; and
                        (D) biogenic emissions resulting from biological
                    processes, such as anaerobic decomposition,
                    nitrification, and denitrification.
                (6) Indian tribe.--The term ``Indian tribe'' has the
            meaning given the term in section 4 of the Indian Self-
            Determination and Education Assistance Act (25 U.S.C. 450b).
                (7) Registry.--The term ``Registry'' means the Federal
            greenhouse gas registry established under section 1105(a).
                (8) Source.--The term ``source'' means any building,
            structure, installation, unit, point, operation, vehicle, land
            area, or other item that emits or may emit a greenhouse gas.

    SEC. 1103. REPORTING REQUIREMENTS.

        (a) In General.--Subject to this section, each affected facility
    shall submit to the Administrator, for inclusion in the Registry,
    periodic reports, including annual and quarterly data, that--
                (1) include the quantity and type of fossil fuels,
            including feedstock fossil fuels, that are extracted, produced,
            refined, imported, exported, or consumed at or by the facility;
                (2) include the quantity of hydrofluorocarbons,
            perfluorocarbons, sulfur hexafluoride, nitrous oxide, carbon
            dioxide that has been captured and sequestered, and other
            greenhouse gases generated, produced, imported, exported, or
            consumed at or by the facility;
                (3) include the quantity of electricity generated,
            imported, exported, or consumed by or at the facility, and
            information on the quantity of greenhouse gases emitted when
            the imported, exported, or consumed electricity was generated,
            as determined by the Administrator;
                (4) include the aggregate quantity of all greenhouse gas
            emissions from sources at the facility, including stationary
            combustion source emissions, process emissions, and fugitive
            emissions;
                (5) include greenhouse gas emissions expressed in metric
            tons of each greenhouse gas emitted and in the quantity of
            carbon dioxide equivalents of each greenhouse gas emitted;
                (6) include a list and description of sources of greenhouse
            gas emissions at the facility;
                (7) quantify greenhouse gas emissions in accordance with
            the measurement standards established under section 1104;
                (8) include other data necessary for accurate and complete
            accounting of greenhouse gas emissions, as determined by the
            Administrator;
                (9) include an appropriate certification regarding the
            accuracy and completeness of reported data, as determined by
            the Administrator; and
                (10) are submitted electronically to the Administrator, in
            such form and to such extent as may be required by the
            Administrator.
        (b) De Minimis Exemptions.--
                (1) In general.--The Administrator may determine--
                        (A) whether certain sources at a facility should be
                    considered to be eligible for a de minimis exemption
                    from a requirement for reporting under subsection (a);
                    and
                        (B) the level of greenhouse gases emitted from a
                    source that would qualify for such an exemption.
                (2) Factors.--In making a determination under paragraph
            (1), the Administrator shall consider the availability and
            suitability of simplified techniques and tools for quantifying
            emissions and the cost to measure those emissions relative to
            the purposes of this title, including the goal of collecting
            complete and consistent facility-wide data.
        (c) Verification of Report Required.--Before including the
    information from a report required under this section in the Registry,
    the Administrator shall verify the completeness and accuracy of the
    report using information provided under this section, obtained under
    section 9002(c), or obtained under other provisions of law.
        (d) Timing.--
                (1) Calendar years 2004 through 2007.--For a baseline
            period of calendar years 2004 through 2007, each affected
            facility shall submit required annual data described in this
            section to the Administrator not later than March 31, 2009.
                (2) Subsequent calendar years.--For calendar year 2008 and
            each subsequent calendar year, each affected facility shall
            submit quarterly data described in this section to the
            Administrator not later than 60 days after the end of the
            applicable quarter.
        (e) No Effect on Other Requirements.--Nothing in this title affects
    any requirement in effect as of the date of enactment of this Act
    relating to the reporting of--
                (1) fossil fuel production, refining, importation,
            exportation, or consumption data;
                (2) greenhouse gas emission data; or
                (3) other relevant data.

    SEC. 1104. DATA QUALITY AND VERIFICATION.

        (a) Protocols and Methods.--
                (1) In general.--The Administrator shall establish by
            regulation, taking into account the work done by the Climate
            Registry, comprehensive protocols and methods to ensure the
            accuracy, completeness, consistency, and transparency of data
            on greenhouse gas emissions and fossil fuel production,
            refining, importation, exportation, and consumption submitted
            to the Registry that include--
                        (A) accounting and reporting standards for fossil
                    fuel production, refining, importation, exportation,
                    and consumption;
                        (B) a requirement that, where technically feasible,
                    submitted data are monitored using monitoring systems
                    for fuel flow or emissions, such as continuous emission
                    monitoring systems or equivalent systems of similar
                    rigor, accuracy, quality, and timeliness;
                        (C) a requirement that, if a facility has already
                    been directed to monitor emissions of a greenhouse gas
                    using a continuous emission monitoring system under
                    existing law, that system be used in complying with
                    this Act with respect to the greenhouse gas;
                        (D) for cases in which the Administrator determines
                    that monitoring emissions with the precision,
                    reliability, accessibility, and timeliness similar to
                    that provided by a continuous emission monitoring
                    system are not technologically feasible, standardized
                    methods for calculating greenhouse gas emissions in
                    specific industries using other readily available and
                    reliable information, such as fuel consumption,
                    materials consumption, production, or other relevant
                    activity data, on the condition that those methods do
                    not underreport emissions, as compared with the
                    continuous emission monitoring system;
                        (E) information on the accuracy of measurement and
                    calculation methods;
                        (F) methods to avoid double-counting of greenhouse
                    gas emissions;
                        (G) protocols to prevent an affected facility from
                    avoiding the reporting requirements of this title (such
                    as by reorganizing into multiple entities or
                    outsourcing activities that result in greenhouse gas
                    emissions); and
                        (H) protocols for verification of data submitted by
                    affected facilities.
                (2) Best practices.--The protocols and methods developed
            under paragraph (1) shall incorporate and conform to the best
            practices from the most recent Federal, State, and
            international protocols for the measurement, accounting,
            reporting, and verification of greenhouse gas emissions to
            ensure the accuracy, completeness, and consistency of the data.
        (b) Verification; Information by Reporting Entities.--Each affected
    facility shall--
                (1) provide information sufficient for the Administrator to
            verify, in accordance with the protocols and methods developed
            under subsection (a), that the fossil fuel data and greenhouse
            gas emission data of the affected facility have been completely
            and accurately reported; and
                (2) ensure the submission or retention, for the 5-year
            period beginning on the date of provision of the information,
            of--
                        (A) data sources;
                        (B) information on internal control activities;
                        (C) information on assumptions used in reporting
                    emissions and fuels;
                        (D) uncertainty analyses; and
                        (E) other relevant data and information to
                    facilitate the verification of reports submitted to the
                    Registry.
        (c) Waiver of Reporting Requirements.--The Administrator may waive
    reporting requirements for specific facilities if the Administrator
    determines that sufficient and equally or more reliable data are
    available under other provisions of law.
        (d) Missing Data.--If information, satisfactory to the
    Administrator, is not provided for an affected facility, the
    Administrator shall--
                (1) prescribe methods to estimate emissions for the
            facility for each period for which data are missing, reflecting
            the highest emission levels that may reasonably have occurred
            during the period for which data are missing; and
                (2) take appropriate enforcement action pursuant to this
            section and section 9002(b).

    SEC. 1105. FEDERAL GREENHOUSE GAS REGISTRY.

        (a) Establishment.--The Administrator shall establish a Federal
    greenhouse gas registry.
        (b) Administration.--In establishing the Registry, the
    Administrator shall--
                (1) design and operate the Registry;
                (2) establish an advisory body that is broadly
            representative of private enterprise, agriculture,
            environmental groups, and State, tribal, and local governments
            to guide the development and management of the Registry;
                (3) provide coordination and technical assistance for the
            development of proposed protocols and methods, taking into
            account the duties carried out by the Climate Registry, to be
            published by the Administrator;
                (4)(A) develop an electronic format for reporting under
            guidelines established under section 1104(a)(1); and
                (B) make the electronic format available to reporting
            entities;
                (5) verify and audit the data submitted by reporting
            entities;
                (6) establish consistent policies for calculating carbon
            content and greenhouse gas emissions for each type of fossil
            fuel reported under section 1103;
                (7) calculate carbon content and greenhouse gas emissions
            associated with the combustion of fossil fuel data reported by
            reporting entities; and
                (8) immediately publish on the Internet all information
            contained in the Registry, except in any case in which
            publishing the information would result in a disclosure of--
                        (A) information vital to national security, as
                    determined by the President; or
                        (B) confidential business information that cannot
                    be derived from information that is otherwise publicly
                    available and that would cause significant calculable
                    competitive harm if published (except that information
                    relating to greenhouse gas emissions shall not be
                    considered to be confidential business information).
        (c) Third-Party Verification.--The Administrator may use the
    services of third parties that have no conflicts of interest to verify
    reports required under section 1103.
        (d) Regulations.--The Administrator shall--
                (1) not later than 180 days after the date of enactment of
            this Act, propose regulations to carry out this section; and
                (2) not later than July 1, 2008, promulgate final
            regulations to carry out this section.

    SEC. 1106. ENFORCEMENT.

        (a) Civil Actions.--The Administrator may bring a civil action in
    United States district court against the owner or operator of an
    affected facility that fails to comply with any requirement of this
    subtitle.
        (b) Penalty.--Any person that has violated or is violating this
    subtitle shall be subject to a civil penalty of not more than $25,000
    per day of each violation.

                         Subtitle B--Reducing Emissions

    SEC. 1201. EMISSION ALLOWANCE ACCOUNT.

        (a) In General.--The Administrator shall establish a separate
    quantity of emission allowances for each of calendar years 2012 through
    2050.
        (b) Identification Numbers.--The Administrator shall assign to each
    emission allowance established under subsection (a) a unique
    identification number that includes the calendar year for which that
    emission allowance was established.
        (c) Legal Status of Emission Allowances.--
                (1) In general.--An emission allowance shall not be a
            property right.
                (2) Termination or limitation.--Nothing in this Act or any
            other provision of law limits the authority of the United
            States to terminate or limit an emission allowance.
                (3) Other provisions unaffected.--Nothing in this Act
            relating to emission allowances shall affect the application
            of, or compliance with, any other provision of law to or by a
            covered facility.
        (d) Allowances for Each Calendar Year.--The numbers of emission
    allowances established by the Administrator for each of calendar years
    2012 through 2050 shall be as follows:

    ----------------------------------------------------------------------------------------------------------------
                                                                                  Number of Emission Allowances (in
                                   Calendar Year                                              Millions)
    ----------------------------------------------------------------------------------------------------------------
    2012                                                                                                      5,775
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2013                                                                                                      5,669
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2014                                                                                                      5,562
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2015                                                                                                      5,456
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2016                                                                                                      5,349
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2017                                                                                                      5,243
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2018                                                                                                      5,137
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2019                                                                                                      5,030
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2020                                                                                                      4,924
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2021                                                                                                      4,817
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2022                                                                                                      4,711
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2023                                                                                                      4,605
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2024                                                                                                      4,498
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2025                                                                                                      4,392
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2026                                                                                                      4,286
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2027                                                                                                      4,179
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2028                                                                                                      4,073
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2029                                                                                                      3,966
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2030                                                                                                      3,860
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2031                                                                                                      3,754
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2032                                                                                                      3,647
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2033                                                                                                      3,541
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2034                                                                                                      3,435
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2035                                                                                                      3,328
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2036                                                                                                      3,222
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2037                                                                                                      3,115
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2038                                                                                                      3,009
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2039                                                                                                      2,903
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2040                                                                                                      2,796
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2041                                                                                                      2,690
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2042                                                                                                      2,584
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2043                                                                                                      2,477
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2044                                                                                                      2,371
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2045                                                                                                      2,264
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2046                                                                                                      2,158
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2047                                                                                                      2,052
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2048                                                                                                      1,945
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2049                                                                                                      1,839
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2050                                                                                                      1,732
    ----------------------------------------------------------------------------------------------------------------

    SEC. 1202. COMPLIANCE OBLIGATION.

        (a) In General.--Not later than 90 days after the end of a calendar
    year, the owner or operator of a covered facility shall submit to the
    Administrator an emission allowance, an offset allowance awarded
    pursuant to subtitle D of title II, or an international emission
    allowance obtained in compliance with regulations promulgated under
    section 2502, for each carbon dioxide equivalent of--
                (1) group I greenhouse gas that was emitted by the use of
            coal by that covered facility during the preceding year;
                (2) group I greenhouse gas that will, assuming no capture
            and sequestration of that gas, be emitted from the use of any
            petroleum- or coal-based liquid or gaseous fuel that was
            produced or imported by that covered facility during the
            preceding year;
                (3) group I greenhouse gas that was produced for sale or
            distribution or imported by that facility during the preceding
            year;
                (4) group II greenhouse gas that was emitted as a byproduct
            of hydrochlorofluorocarbon production; and
                (5) group I greenhouse gas that will, assuming no capture
            and destruction or sequestration of that gas, be emitted--
                        (A) from the use of natural gas that was, by that
                    covered facility, processed, imported, or produced and
                    not reinjected into the field; or
                        (B) from the use of natural gas liquids that were
                    processed or imported by that covered facility during
                    the preceding year.
        (b) Requirements.--
                (1) Assumptions.--For the purpose of calculating the
            submission requirement under paragraphs (2) through (5) of
            subsection (a), the Administrator shall, subject to subsections
            (e) through (g), assume that no capture, sequestration,
            chemical retention, or other retention of a greenhouse gas has
            occurred or will occur.
                (2) Factors for consideration.--For the purpose of
            calculating the submission requirement under paragraph (1) of
            subsection (a), the Administrator shall take into account any
            metric tons of carbon dioxide that the owner or operator has
            geologically sequestered during the preceding calendar year.
        (c) Retirement of Allowances.--Immediately upon receipt of an
    emission allowance under subsection (a), the Administrator shall retire
    the emission allowance.
        (d) Determination of Compliance.--Not later than July 1 of each
    year, the Administrator shall determine whether the owners and
    operators of all covered facilities are in full compliance with
    subsection (a) for the preceding year.
        (e) Feedstock Credit.--If the Administrator determines that an
    entity has used a petroleum- or coal-based product, natural gas, or a
    natural gas liquid as a feedstock during any of calendar years 2012
    through 2050, such that no group I greenhouse gas associated with that
    feedstock will be emitted, the Administrator shall establish and
    distribute to that entity a quantity of emission allowances equal to
    the quantity of emission allowances, offset allowances, or
    international emission allowances submitted under subsection (a) for
    that petroleum- or coal-based product, natural gas, or natural gas
    liquid.
        (f) Sequestration Credit.--If the Administrator determines that the
    owner or operator of a covered facility that is subject to the
    submission requirement under any of paragraphs (2) through (5) of
    subsection (a) has geologically sequestered carbon dioxide during any
    of calendar years 2012 through 2050, the Administrator shall establish
    and distribute to that owner or operator a quantity of emission
    allowances equal to the number of metric tons of carbon dioxide that
    the owner or operator geologically sequestered during that calendar
    year.
        (g) Destruction Credit.--If the Administrator determines that an
    entity has destroyed greenhouse gas during any of calendar years 2012
    through 2050, the Administrator shall establish and distribute to that
    entity a quantity of emission allowances equal to the number of carbon
    dioxide equivalents of greenhouse gas that the owner or operator
    destroyed during that calendar year.

    SEC. 1203. PENALTY FOR NONCOMPLIANCE.

        (a) Excess Emissions Penalty.--
                (1) In general.--The owner or operator of any covered
            facility that fails for any year to submit to the Administrator
            by the deadline described in section 1202(a) or 2303, 1 or more
            of the emission allowances due pursuant to either of those
            sections shall be liable for the payment to the Administrator
            of an excess emissions penalty.
                (2) Amount.--The amount of an excess emissions penalty
            required to be paid under paragraph (1) shall be, as determined
            by the Administrator, an amount equal to the product obtained
            by multiplying--
                        (A) the number of excess emission allowances that
                    the owner or operator failed to submit; and
                        (B) the greater of--
                                (i) $200; or
                                (ii) a dollar figure representing 3 times
                            the mean market value of an emission allowance
                            during the calendar year for which the emission
                            allowances were due.
                (3) Timing.--An excess emissions penalty required under
            this subsection shall be immediately due and payable to the
            Administrator, without demand, in accordance with such
            regulations as shall be promulgated by the Administrator by the
            date that is 1 year after the date of enactment of this Act.
                (4) Deposit.--The Administrator shall deposit each excess
            emissions penalty paid under this subsection in the Treasury of
            the United States.
                (5) No effect on liability.--An excess emissions penalty
            due and payable by the owner or operator of a covered facility
            under this subsection shall not diminish the liability of the
            owner or operator for any fine, penalty, or assessment against
            the owner or operator for the same violation under any other
            provision of this Act or any other law.
        (b) Excess Emission Allowance.--
                (1) In general.--The owner or operator of a covered
            facility that fails for any year to submit to the Administrator
            by the deadline described in section 1202(a) or 2303 1 or more
            of the emission allowances due pursuant to either of those
            sections shall be liable to offset the excess emissions by an
            equal quantity, in tons, during--
                        (A) the following calendar year; or
                        (B) such longer period as the Administrator may
                    prescribe.
                (2) Plan.--
                        (A) In general.--Not later than 60 days after the
                    end of the calendar year during which a covered
                    facility emits excess emissions, the owner or operator
                    of the covered facility shall submit to the
                    Administrator, and to the State in which the covered
                    facility is located, a proposed plan to achieve the
                    required offsets for the excess emissions.
                        (B) Condition of operation.--Upon approval of a
                    proposed plan described in subparagraph (A) by the
                    Administrator, the plan, as submitted, modified, or
                    conditioned, shall be considered to be a condition of
                    the operating permit for the covered facility, without
                    further review or revision of the permit.
                        (C) Deduction of allowances.--For each covered
                    facility that, in any calendar year, emits excess
                    emissions, the Administrator shall deduct, from
                    emission allowances allocated to the covered facility
                    for the calendar year, or for succeeding years during
                    which offsets are required, emission allowances equal
                    to the excess quantity, in tons, of the excess
                    emissions.
        (c) Prohibition.--It shall be unlawful for the owner or operator of
    any facility liable for a penalty and offset under this section to
    fail--
                (1) to pay the penalty in accordance with this section;
                (2) to provide, and thereafter comply with, a proposed plan
            for compliance as required by subsection (b)(2); and
                (3) to offset excess emissions as required by subsection
            (b)(1).
        (d) No Effect on Other Section.--Nothing in this subtitle limits or
    otherwise affects the application of section 9002(b).

    SEC. 1204. RULEMAKING.

        Not later than 2 years after the date of enactment of this Act, the
    Administrator shall, by rule, expand the definition of the term
    ``covered facility'' to ensure the inclusion of all greenhouse gas
    emissions from natural gas emitted, flared during production or
    processing, or sold for use in the United States.

              TITLE II--MANAGING AND CONTAINING COSTS EFFICIENTLY

                              Subtitle A--Trading

    SEC. 2101. SALE, EXCHANGE, AND RETIREMENT OF EMISSION ALLOWANCES.

        Except as otherwise provided in this Act, the lawful holder of an
    emission allowance may, without restriction, sell, exchange, transfer,
    submit for compliance in accordance with section 1202, or retire the
    emission allowance.

    SEC. 2102. NO RESTRICTION ON TRANSACTIONS.

        The privilege of purchasing, holding, selling, exchanging, and
    retiring emission allowances shall not be restricted to the owners and
    operators of covered facilities.

    SEC. 2103. ALLOWANCE TRANSFER SYSTEM.

        (a) In General.--Not later than 18 months after the date of
    enactment of this Act, the Administrator shall promulgate regulations
    to carry out the provisions of this Act relating to emission
    allowances, including regulations providing that the transfer of
    emission allowances shall not be effective until such date as a written
    certification of the transfer, signed by a responsible official of each
    party to the transfer, is received and recorded by the Administrator in
    accordance with those regulations.
        (b) Transfers.--
                (1) In general.--The regulations promulgated under
            subsection (a) shall permit the transfer of allowances prior to
            the issuance of the allowances.
                (2) Deduction and addition of transfers.--A recorded pre-
            allocation transfer of allowances shall be--
                        (A) deducted by the Administrator from the number
                    of allowances that would otherwise be distributed to
                    the transferor; and
                        (B) added to those allowances distributed to the
                    transferee.

    SEC. 2104. ALLOWANCE TRACKING SYSTEM.

        The regulations promulgated under section 2103(a) shall include a
    system for issuing, recording, and tracking emission allowances that
    shall specify all necessary procedures and requirements for an orderly
    and competitive functioning of the emission allowance system.

                              Subtitle B--Banking

    SEC. 2201. INDICATION OF CALENDAR YEAR.

        An emission allowance submitted to the Administrator by the owner
    or operator of a covered facility in accordance with section 1202(a)
    shall not be required to indicate in the identification number of the
    emission allowance the calendar year for which the emission allowance
    is submitted.

    SEC. 2202. EFFECT OF TIME.

        The passage of time shall not, by itself, cause an emission
    allowance to be retired or otherwise diminish the compliance value of
    the emission allowance.

                             Subtitle C--Borrowing

    SEC. 2301. REGULATIONS.

        (a) In General.--Not later than 3 years after the date of enactment
    of this Act, the Administrator shall promulgate regulations under
    which, subject to subsection (b), the owner or operator of a covered
    facility may--
                (1) borrow emission allowances from the Administrator; and
                (2) for a calendar year, submit borrowed emission
            allowances to the Administrator in satisfaction of up to 15
            percent of the compliance obligation under section 1202(a).
        (b) Limitation.--An emission allowance borrowed under subsection
    (a) shall be an emission allowance established by the Administrator for
    a specific future calendar year under subsection 1201(a).

    SEC. 2302. TERM.

        The owner or operator of a covered facility shall not submit, and
    the Administrator shall not accept, a borrowed emission allowance in
    partial satisfaction of the compliance obligation under section 1202(a)
    for any calendar year that is more than 5 years earlier than the
    calendar year included in the identification number of the borrowed
    emission allowance.

    SEC. 2303. REPAYMENT WITH INTEREST.

        For each borrowed emission allowance submitted in partial
    satisfaction of the compliance obligation under subsection 1202(a) for
    a particular calendar year (referred to in this section as the ``use
    year''), the number of emission allowances that the owner or operator
    is required to submit under section 1202(a) for the year from which the
    borrowed emission allowance was taken (referred to in this section as
    the ``source year'') shall be increased by an amount equal to the
    product obtained by multiplying--
                (1) 1.1; and
                (2) the number of years beginning after the use year and
            before the source year.

                              Subtitle D--Offsets

    SEC. 2401. OUTREACH INITIATIVE ON REVENUE ENHANCEMENT FOR AGRICULTURAL
                  PRODUCERS.

        (a) Establishment.--The Secretary of Agriculture, acting through
    the Chief of the Natural Resources Conservation Service, the Chief of
    the Forest Service, the Administrator of the Cooperative State
    Research, Education, and Extension Service, and land-grant colleges and
    universities, in consultation with the Administrator and the heads of
    other appropriate departments and agencies, shall establish an outreach
    initiative to provide information to agricultural producers,
    agricultural organizations, foresters, and other landowners about
    opportunities under this subtitle to earn new revenue.
        (b) Components.--The initiative under this section--
                (1) shall be designed to ensure that, to the maximum extent
            practicable, agricultural organizations and individual
            agricultural producers, foresters, and other landowners receive
            detailed practical information about--
                        (A) opportunities to earn new revenue under this
                    subtitle;
                        (B) measurement protocols, monitoring, verifying,
                    inventorying, registering, insuring, and marketing
                    offsets under this title;
                        (C) emerging domestic and international markets for
                    energy crops, allowances, and offsets; and
                        (D) local, regional, and national databases and
                    aggregation networks to facilitate achievement,
                    measurement, registration, and sales of offsets;
                (2) shall provide--
                        (A) outreach materials, including the handbook
                    published under subsection (c), to interested parties;
                        (B) workshops; and
                        (C) technical assistance; and
                (3) may include the creation and development of regional
            marketing centers or coordination with existing centers
            (including centers within the Natural Resources Conservation
            Service or the Cooperative State Research, Education, and
            Extension Service or at land-grant colleges and universities).
        (c) Handbook.--
                (1) In general.--Not later than 2 years after the date of
            enactment of this Act, the Secretary of Agriculture, in
            consultation with the Administrator and after an opportunity
            for public comment, shall publish a handbook for use by
            agricultural producers, agricultural cooperatives, foresters,
            other landowners, offset buyers, and other stakeholders that
            provides easy-to-use guidance on achieving, reporting,
            registering, and marketing offsets.
                (2) Distribution.--The Secretary of Agriculture shall
            ensure, to the maximum extent practicable, that the handbook--
                        (A) is made available through the Internet and in
                    other electronic media;
                        (B) includes, with respect to the electronic form
                    of the handbook described in subparagraph (A),
                    electronic forms and calculation tools to facilitate
                    the petition process described in section 2404; and
                        (C) is distributed widely through land-grant
                    colleges and universities and other appropriate
                    institutions.

    SEC. 2402. ESTABLISHMENT OF DOMESTIC OFFSET PROGRAM.

        (a) Alternative Means of Compliance.--Beginning with calendar year
    2012, the owner or operator of a covered entity may satisfy up to 15
    percent of the total allowance submission requirement of the covered
    entity under section 1202(a) by submitting offset allowances generated
    in accordance with this subtitle.
        (b) Regulations Required.--
                (1) In general.--Not later than 18 months after the date of
            enactment of this Act, the Administrator, in conjunction with
            the Secretary of Agriculture, shall promulgate regulations
            authorizing the issuance and certification of offset
            allowances.
                (2) Certain sources.--
                        (A) In general.--For offsets from sources of
                    greenhouse gases not linked to agricultural, forestry,
                    or other land use-related projects, the regulations
                    promulgated under this subsection shall require that
                    the owner of the project establish the project baseline
                    and register emissions under the Federal Greenhouse Gas
                    Registry established under section 1105.
                        (B) Requirement.--The regulations described in
                    subparagraph (A) shall--
                                (i) authorize the issuance and
                            certification of offset allowances for
                            greenhouse gas emission reductions below the
                            project baseline; and
                                (ii) ensure that those offsets represent
                            real, verifiable, additional, permanent, and
                            enforceable reductions in greenhouse gas
                            emissions or increases in sequestration.
                (3) Agricultural, forestry, and other land use-related
            projects.--For offsets from certain agricultural, forestry, and
            other land use-related projects undertaken within the United
            States, the regulations promulgated under this subsection shall
            include provisions that--
                        (A) ensure that those offsets represent real,
                    verifiable, additional, permanent, and enforceable
                    reductions in greenhouse gas emissions or increases in
                    biological sequestration;
                        (B) specify the types of offset projects eligible
                    to generate offset allowances, in accordance with
                    section 2403;
                        (C) establish procedures for project initiation and
                    approval, in accordance with section 2404;
                        (D) establish procedures to monitor, quantify, and
                    discount reductions in greenhouse gas emissions or
                    increases in biological sequestration, in accordance
                    with subsections (d) through (g) of section 2404;
                        (E) establish procedures for third-party
                    verification, registration, and issuance of offset
                    allowances, in accordance with section 2405;
                        (F) ensure permanence of offsets by mitigating and
                    compensating for reversals, in accordance with section
                    2406; and
                        (G) assign a unique serial number to each offset
                    allowance issued under this section.
        (c) Offset Allowances Awarded.--The Administrator shall issue
    offset allowances for qualifying emission reductions and biological
    sequestrations from offset projects that satisfy the applicable
    requirements of this subtitle.
        (d) Ownership.--Initial ownership of an offset allowance shall lie
    with a project developer, unless otherwise specified in a legally-
    binding contract or agreement.
        (e) Transferability.--An offset allowance generated pursuant to
    this subtitle may be sold, traded, or transferred, on the conditions
    that--
                (1) the offset allowance has not expired or been retired or
            canceled; and
                (2) liability and responsibility for mitigating and
            compensating for reversals of registered offset allowances is
            specified in accordance with section 2406(b).

    SEC. 2403. ELIGIBLE OFFSET PROJECT TYPES.

        (a) In General.--Offset allowances from agricultural, forestry, and
    other land use-related projects shall be limited to those allowances
    achieving an offset of 1 or more greenhouse gases by a method other
    than a reduction of combustion of greenhouse gas-emitting fuel.
        (b) Categories of Eligible Offset Projects.--Subject to the
    requirements promulgated pursuant to section 2402(b), the types of
    operations eligible to generate offset allowances under this subtitle
    include--
                (1) agricultural and rangeland sequestration and management
            practices, including--
                        (A) altered tillage practices;
                        (B) winter cover cropping, continuous cropping, and
                    other means to increase biomass returned to soil in
                    lieu of planting followed by fallowing;
                        (C) conversion of cropland to rangeland or
                    grassland, on the condition that the land has been in
                    nonforest use for at least 10 years before the date of
                    initiation of the project;
                        (D) reduction of nitrogen fertilizer use or
                    increase in nitrogen use efficiency;
                        (E) reduction in the frequency and duration of
                    flooding of rice paddies; and
                        (F) reduction in carbon emissions from organic
                    soils;
                (2) changes in carbon stocks attributed to land use change
            and forestry activities limited to--
                        (A) afforestation or reforestation of acreage not
                    forested as of October 18, 2007; and
                        (B) forest management resulting in an increase in
                    forest stand volume;
                (3) manure management and disposal, including--
                        (A) waste aeration; and
                        (B) methane capture and combustion;
                (4) subject to the requirements of this subtitle, any other
            terrestrial offset practices identified by the Administrator,
            including--
                        (A) the capture or reduction of fugitive greenhouse
                    gas emissions for which no covered facility is required
                    under section 1202(a) to submit any emission
                    allowances, offset allowances, or international
                    emission allowances;
                        (B) methane capture and combustion at
                    nonagricultural facilities; and
                        (C) other actions that result in the avoidance or
                    reduction of greenhouse gas emissions in accordance
                    with section 2402; and
                (5) combinations of any of the offset practices described
            in paragraphs (1) through (4).

    SEC. 2404. PROJECT INITIATION AND APPROVAL.

        (a) Project Approval.--A project developer--
                (1) may submit a petition for offset project approval at
            any time following the effective date of regulations
            promulgated under section 2402(b); but
                (2) may not register or issue offset allowances until such
            approval is received and until after the emission reductions or
            sequestrations supporting the offset allowances have actually
            occurred.
        (b) Petition Process.--Prior to offset registration and issuance of
    offset allowances, a project developer shall submit a petition to the
    Administrator, consisting of--
                (1) a copy of the monitoring and quantification plan
            prepared for the offset project, as described under subsection
            (d);
                (2) a greenhouse gas initiation certification, as described
            under subsection (e); and
                (3) subject to the requirements of this subtitle, any other
            information identified by the Administrator in the regulations
            promulgated under section 2402 as necessary to meet the
            objectives of this subtitle.
        (c) Approval and Notification.--
                (1) In general.--Not later than 180 days after the date on
            which the Administrator receives a complete petition under
            subsection (b), the Administrator shall--
                        (A) determine whether the monitoring and
                    quantification plan satisfies the applicable
                    requirements of this subtitle;
                        (B) determine whether the greenhouse gas initiation
                    certification indicates a significant deviation in
                    accordance with subsection (e)(3);
                        (C) notify the project developer of the
                    determinations under subparagraphs (A) and (B); and
                        (D) issue offset allowances for approved projects.
                (2) Appeal.--The Administrator shall establish mechanisms
            for appeal and review of determinations made under this
            subsection.
        (d) Monitoring and Quantification.--
                (1) In general.--A project developer shall make use of the
            standardized tools and methods described in this section to
            monitor, quantify, and discount reductions in greenhouse gas
            emissions or increases in sequestration.
                (2) Monitoring and quantification plan.--A monitoring and
            quantification plan shall be used to monitor, quantify, and
            discount reductions in greenhouse gas emissions or increases in
            sequestration as described by this subsection.
                (3) Plan completion and retention.--A monitoring and
            quantification plan shall be--
                        (A) completed for all offset projects prior to
                    offset project initiation; and
                        (B) retained by the project developer for the
                    duration of the offset project.
                (4) Plan requirements.--Subject to section 2402, the
            Administrator, in conjunction with the Secretary of
            Agriculture, shall specify the required components of a
            monitoring and quantification plan, including--
                        (A) a description of the offset project, including
                    project type;
                        (B) a determination of accounting periods;
                        (C) an assignment of reporting responsibility;
                        (D) the contents and timing of public reports,
                    including summaries of the original data, as well as
                    the results of any analyses;
                        (E) a delineation of project boundaries, based on
                    acceptable methods and formats;
                        (F) a description of which of the monitoring and
                    quantification tools developed under subsection (f) are
                    to be used to monitor and quantify changes in
                    greenhouse gas fluxes or carbon stocks associated with
                    a project;
                        (G) a description of which of the standardized
                    methods developed under subsection (g) to be used to
                    determine additionality, estimate the baseline carbon,
                    and discount for leakage;
                        (H) based on the standardized methods chosen in
                    subparagraphs (F) and (G), a determination of
                    uncertainty in accordance with subsection (h);
                        (I) what site-specific data, if any, will be used
                    in monitoring, quantification, and the determination of
                    discounts;
                        (J) a description of procedures for use in managing
                    and storing data, including quality-control standards
                    and methods, such as redundancy in case records are
                    lost;
                        (K) subject to the requirements of this subtitle,
                    any other information identified by the Administrator
                    or the Secretary of Agriculture as being necessary to
                    meet the objectives of this subtitle; and
                        (L) a description of the risk of reversals for the
                    project, including any way in which the proposed
                    project may alter the risk of reversal for the project
                    or other projects in the area.
        (e) Greenhouse Gas Initiation Certification.--
                (1) In general.--In reviewing a petition submitted under
            subsection (b), the Administrator shall seek to exclude each
            activity that undermines the integrity of the offset program
            established under this subtitle, such as the conversion or
            clearing of land, or marked change in management regime, in
            anticipation of offset project initiation.
                (2) Greenhouse gas initiation certification requirements.--
            A greenhouse gas initiation certification developed under this
            subsection shall include--
                        (A) the estimated greenhouse gas flux or carbon
                    stock for the offset project for each of the 4 complete
                    calendar years preceding the effective date of the
                    regulations promulgated under section 2402(b); and
                        (B) the estimated greenhouse gas flux or carbon
                    stock for the offset project, averaged across each of
                    the 4 calendar years preceding the effective date of
                    the regulations promulgated under section 2402(b).
                (3) Determination of significant deviation.--Based on
            standards developed by the Administrator, in conjunction with
            the Secretary of Agriculture--
                        (A) each greenhouse gas initiation certification
                    submitted pursuant to this section shall be reviewed;
                    and
                        (B) a determination shall be made as to whether, as
                    a result of activities or behavior inconsistent with
                    the purposes of this title, a significant deviation
                    exists between the average annual greenhouse gas flux
                    or carbon stock and the greenhouse gas flux or carbon
                    stock for a given year.
                (4) Adjustment for projects with significant deviation.--In
            the case of a significant deviation, the Administrator shall
            adjust the number of allowances awarded in order to account for
            the deviation.
        (f) Development of Monitoring and Quantification Tools for Offset
    Projects.--
                (1) In general.--Subject to section 2402(b), the
            Administrator, in conjunction with the Secretary of
            Agriculture, shall develop standardized tools for use in the
            monitoring and quantification of changes in greenhouse gas
            fluxes or carbon stocks for each offset project type listed
            under section 2403(b).
                (2) Tool development.--The tools used to monitor and
            quantify changes in greenhouse gas fluxes or carbon stocks
            shall, for each project type, include applicable--
                        (A) statistically-sound field and remote sensing
                    sampling methods, procedures, techniques, protocols, or
                    programs;
                        (B) models, factors, equations, or look-up tables;
                    and
                        (C) any other process or tool considered to be
                    acceptable by the Administrator, in conjunction with
                    the Secretary of Agriculture.
        (g) Development of Accounting and Discounting Methods.--
                (1) In general.--The Administrator, in consultation with
            the Secretary of Agriculture, shall--
                        (A) develop standardized methods for use in
                    accounting for additionality and uncertainty,
                    estimating the baseline, and discounting for leakage
                    for each offset project type listed under section
                    2403(b); and
                        (B) require that leakage be subtracted from
                    reductions in greenhouse gas emissions or increases in
                    sequestration attributable to a project.
                (2) Additionality determination and baseline estimation.--
            The standardized methods used to determine additionality and
            establish baselines shall, for each project type, at a
            minimum--
                        (A) in the case of a sequestration project,
                    determine the greenhouse gas flux and carbon stock on
                    comparable land identified on the basis of--
                                (i) similarity in current management
                            practices;
                                (ii) similarity of regional, State, or
                            local policies or programs; and
                                (iii) similarity in geographical and
                            biophysical characteristics;
                        (B) in the case of an emission reduction project,
                    use as a basis emissions from comparable land or
                    facilities; and
                        (C) in the case of a sequestration project or
                    emission reduction project, specify a selected time
                    period.
                (3) Leakage.--The standardized methods used to determine
            and discount for leakage shall, at a minimum, take into
            consideration--
                        (A) the scope of the offset system in terms of
                    activities and geography covered;
                        (B) the markets relevant to the offset project;
                        (C) emission intensity per unit of production, both
                    inside and outside of the offset project; and
                        (D) a time period sufficient in length to yield a
                    stable leakage rate.
        (h) Uncertainty for Agricultural and Forestry Projects.--
                (1) In general.--The Administrator, in conjunction with the
            Secretary of Agriculture, shall develop standardized methods
            for use in determining and discounting for uncertainty for each
            offset project type listed under section 2403(b).
                (2) Basis.--The standardized methods used to determine and
            discount for uncertainty shall be based on--
                        (A) the robustness and rigor of the methods used by
                    a project developer to monitor and quantify changes in
                    greenhouse gas fluxes or carbon stocks;
                        (B) the robustness and rigor of methods used by a
                    project developer to determine additionality and
                    leakage; and
                        (C) an exaggerated proportional discount that
                    increases relative to uncertainty, as determined by the
                    Administrator, in conjunction with the Secretary of
                    Agriculture, to encourage better measurement and
                    accounting.
        (i) Acquisition of New Data and Review of Methods for Agricultural
    and Forestry Projects.--The Administrator, in conjunction with the
    Secretary of Agriculture, shall--
                (1) establish a comprehensive field sampling program to
            improve the scientific bases on which the standardized tools
            and methods developed under this section are based; and
                (2) review and revise the standardized tools and methods
            developed under this section, based on--
                        (A) validation of existing methods, protocols,
                    procedures, techniques, factors, equations, or models;
                        (B) development of new methods, protocols,
                    procedures, techniques, factors, equations, or models;
                        (C) increased availability of field data or other
                    datasets; and
                        (D) any other information identified by the
                    Administrator, in conjunction with the Secretary of
                    Agriculture, that is necessary to meet the objectives
                    of this subtitle.
        (j) Exclusion.--No activity for which any emission allowances are
    received under subtitle G of title III shall generate offset allowances
    under this subtitle.

    SEC. 2405. OFFSET VERIFICATION AND ISSUANCE OF ALLOWANCES.

        (a) In General.--Offset allowances may be claimed for net emission
    reductions or increases in sequestration annually, after accounting for
    any necessary discounts in accordance with section 2404, by submitting
    a verification report for an offset project to the Administrator.
        (b) Offset Verification.--
                (1) Scope of verification.--A verification report for an
            offset project shall--
                        (A) be completed by a verifier accredited in
                    accordance with paragraph (3); and
                        (B) shall be developed taking into consideration--
                                (i) the information and methodology
                            contained within a monitoring and
                            quantification plan;
                                (ii) data and subsequent analysis of the
                            offset project, including--
                                        (I) quantification of net emission
                                    reductions or increases in
                                    sequestration;
                                        (II) determination of
                                    additionality;
                                        (III) calculation of leakage;
                                        (IV) assessment of permanence;
                                        (V) discounting for uncertainty;
                                    and
                                        (VI) the adjustment of net emission
                                    reductions or increases in
                                    sequestration by the discounts
                                    determined under clauses (II) through
                                    (V); and
                                (iii) subject to the requirements of this
                            subtitle, any other information identified by
                            the Administrator as being necessary to achieve
                            the purposes of this subtitle.
                (2) Verification report requirements.--The Administrator
            shall specify the required components of a verification report,
            including--
                        (A) the quantity of offsets generated;
                        (B) the amount of discounts applied;
                        (C) an assessment of methods (and the
                    appropriateness of those methods);
                        (D) an assessment of quantitative errors or
                    omissions (and the effect of the errors or omissions on
                    offsets);
                        (E) any potential conflicts of interest between a
                    verifier and project developer; and
                        (F) any other provision that the Administrator
                    considers to be necessary to achieve the purposes of
                    this subtitle.
                (3) Verifier accreditation.--
                        (A) In general.--Not later than 18 months after the
                    date of enactment of this Act, the Administrator shall
                    promulgate regulations establishing a process and
                    requirements for accreditation by a third-party
                    verifier that has no conflicts of interest.
                        (B) Public accessibility.--Each verifier meeting
                    the requirements for accreditation in accordance with
                    this paragraph shall be listed in a publicly-accessible
                    database, which shall be maintained and updated by the
                    Administrator.
        (c) Registration and Awarding of Offsets.--
                (1) In general.--Not later than 90 days after the date on
            which the Administrator receives a verification report required
            under subsection (b), the Administrator shall--
                        (A) determine whether the offsets satisfy the
                    applicable requirements of this subtitle; and
                        (B) notify the project developer of that
                    determination.
                (2) Affirmative determination.--In the case of an
            affirmative determination under paragraph (1), the
            Administrator shall--
                        (A) register the offset allowances in accordance
                    with this subtitle; and
                        (B) issue the offset allowances.
                (3) Appeal and review.--The Administrator shall establish
            mechanisms for the appeal and review of determinations made
            under this subsection.

    SEC. 2406. TRACKING OF REVERSALS FOR SEQUESTRATION PROJECTS.

        (a) Reversal Certification.--
                (1) In general.--Subject to section 2402, the Administrator
            shall promulgate regulations requiring the submission of a
            reversal certification for each offset project on an annual
            basis following the registration of offset allowances.
                (2) Requirements.--A reversal certification submitted in
            accordance with this subsection shall state--
                        (A) whether any unmitigated reversal relating to
                    the offset project has occurred in the year preceding
                    the year in which the certification is submitted; and
                        (B) the quantity of each unmitigated reversal.
        (b) Effect on Offset Allowances.--
                (1) Invalidity.--The Administrator shall declare invalid
            all offset allowances issued for any offset project that has
            undergone a complete reversal.
                (2) Partial reversal.--In the case of an offset project
            that has undergone a partial reversal, the Administrator shall
            render invalid offset allowances issued for the offset project
            in direct proportion to the degree of reversal.
        (c) Accountability for Reversals.--Liability and responsibility for
    compensation of a reversal of a registered offset allowance under
    subsection (a) shall lie with the owner of the offset allowance, as
    described in section 2402.
        (d) Compensation for Reversals.--The unmitigated reversal of 1 or
    more registered offset allowances that were submitted for the purpose
    of compliance with section 1202(a) shall require the submission of--
                (1) an equal number of offset allowances; or
                (2) a combination of offset allowances and emission
            allowances equal to the unmitigated reversal.
        (e) Project Termination.--A project developer may cease
    participation in the domestic offset program established under this
    subtitle at any time, on the condition that any registered allowances
    awarded for increases in sequestration have been compensated for by the
    project developer through the submission of an equal number of any
    combination of offset allowances and emission allowances.

    SEC. 2407. EXAMINATIONS.

        (a) Regulations.--Not later than 2 years after the date of
    enactment of this Act, the Administrator, in conjunction with the
    Secretary of Agriculture, shall promulgate regulations governing the
    examination and auditing of offset allowances.
        (b) Requirements.--The regulations promulgated under this section
    shall specifically consider--
                (1) principles for initiating and conducting examinations;
                (2) the type or scope of examinations, including--
                        (A) reporting and recordkeeping; and
                        (B) site review or visitation;
                (3) the rights and privileges of an examined party; and
                (4) the establishment of an appeal process.

    SEC. 2408. TIMING AND THE PROVISION OF OFFSET ALLOWANCES.

        (a) Initiation of Offset Projects.--An offset project that
    commences operation on or after the effective date of regulations
    promulgated under section 2407(a) shall be eligible to generate offset
    allowances under this subtitle if the offset project meets the other
    applicable requirements of this subtitle.
        (b) Pre-Existing Projects.--
                (1) In general.--The Administrator may allow for the
            transition into the Registry of offset projects and banked
            offset allowances that, as of the effective date of regulations
            promulgated under section 2407(a), are registered under or meet
            the standards of the Climate Registry, the California Action
            Registry, the GHG Registry, the Chicago Climate Exchange, the
            GHG CleanProjects Registry, or any other Federal, State, or
            private reporting programs or registries if the Administrator
            determines that such other offset projects and banked offset
            allowances under those other programs or registries satisfy the
            applicable requirements of this subtitle.
                (2) Exception.--An offset allowance that is expired,
            retired, or canceled under any other offset program, registry,
            or market as of the effective date of regulations promulgated
            under section 2407(a) shall be ineligible for transition into
            the Registry.

    SEC. 2409. OFFSET REGISTRY.

        In addition to the requirements established by section 2404, an
    offset allowance registered under this subtitle shall be accompanied in
    the Registry by--
                (1) a verification report submitted pursuant to section
            2405(a);
                (2) a reversal certification submitted pursuant to section
            2406(b); and
                (3) subject to the requirements of this subtitle, any other
            information identified by the Administrator as being necessary
            to achieve the purposes of this subtitle.

    SEC. 2410. ENVIRONMENTAL CONSIDERATIONS.

        (a) Coordination To Minimize Negative Effects.--In promulgating
    regulations under this subtitle, the Administrator, in conjunction with
    the Secretary of Agriculture, shall act (including by rejecting
    projects, if necessary) to avoid or minimize, to the maximum extent
    practicable, adverse effects on human health or the environment
    resulting from the implementation of offset projects under this
    subtitle.
        (b) Report on Positive Effects.--Not later than 2 years after the
    date of enactment of this Act, the Administrator, in conjunction with
    the Secretary of Agriculture, shall submit to Congress a report
    detailing--
                (1) the incentives, programs, or policies capable of
            fostering improvements to human health or the environment in
            conjunction with the implementation of offset projects under
            this subtitle; and
                (2) the cost of those incentives, programs, or policies.
        (c) Use of Native Plant Species in Offset Projects.--Not later than
    18 months after the date of enactment of this Act, the Administrator,
    in conjunction with the Secretary of Agriculture, shall promulgate
    regulations for the selection, use, and storage of native and nonnative
    plant materials--
                (1) to ensure native plant materials are given primary
            consideration, in accordance with applicable Department of
            Agriculture guidance for use of native plant materials;
                (2) to prohibit the use of Federal- or State-designated
            noxious weeds; and
                (3) to prohibit the use of a species listed by a regional
            or State invasive plant council within the applicable region or
            State.

    SEC. 2411. PROGRAM REVIEW.

        Not later than 5 years after the date of enactment of this Act, and
    periodically thereafter, the Administrator, in conjunction with the
    Secretary of Agriculture, shall review and revise, as necessary to
    achieve the purposes of this Act, the regulations promulgated under
    this subtitle.

    SEC. 2412. RETAIL CARBON OFFSETS.

        (a) Definition of Retail Carbon Offset.--In this section, the term
    ``retail carbon offset'' means any carbon credit or carbon offset that
    cannot be used in satisfaction of any mandatory compliance obligation
    under a regulatory system for reducing greenhouse gas emissions.
        (b) Qualifying Levels and Requirements.--Not later than January 1,
    2009, the Administrator shall establish new qualifying levels and
    requirements for Energy Star certification for retail carbon offsets,
    effective beginning January 1, 2010.

                 Subtitle E--International Emission Allowances

    SEC. 2501. USE OF INTERNATIONAL EMISSION ALLOWANCES.

        The owner or operator of a covered facility may satisfy up to 15
    percent of the allowance submission requirement of the covered facility
    under section 1202(a) by submitting emission allowances obtained on a
    foreign greenhouse gas emissions trading market, on the condition that
    the Administrator has certified the market in accordance with the
    regulations promulgated pursuant to section 2502(a).

    SEC. 2502. REGULATIONS.

        (a) In General.--Not later than 2 years after the date of enactment
    of this Act, the Administrator shall promulgate regulations, taking
    into consideration protocols adopted in accordance with the United
    Nations Framework Convention on Climate Change, done at New York on May
    9, 1992--
                (1) approving the use under this subtitle of emission
            allowances from such foreign greenhouse gas emissions trading
            markets as the regulations may establish; and
                (2) permitting the use of international emission allowances
            from the foreign country that issued the emission allowances.
        (b) Requirements.--The regulations promulgated under subsection (a)
    shall require that, in order to be approved for use under this
    subtitle--
                (1) an emission allowance shall have been issued by a
            foreign country pursuant to a governmental program that imposes
            mandatory absolute tonnage limits on greenhouse gas emissions
            from the foreign country, or 1 or more industry sectors in that
            country, pursuant to protocols described in subsection (a); and
                (2) the governmental program be of comparable stringency to
            the program established by this Act, including comparable
            monitoring, compliance, and enforcement.

    SEC. 2503. FACILITY CERTIFICATION.

        The owner or operator of a covered facility who submits an
    international emission allowance under this subtitle shall certify that
    the allowance has not been retired from use in the registry of the
    applicable foreign country.

                   Subtitle F--Carbon Market Efficiency Board

    SEC. 2601. PURPOSES.

        The purposes of this subtitle are--
                (1) to ensure that the imposition of limits on greenhouse
            gas emissions will not significantly harm the economy of the
            United States; and
                (2) to establish a Carbon Market Efficiency Board to ensure
            the implementation and maintenance of a stable, functioning,
            and efficient market in emission allowances.

    SEC. 2602. ESTABLISHMENT OF CARBON MARKET EFFICIENCY BOARD.

        (a) Establishment.--There is established a board, to be known as
    the ``Carbon Market Efficiency Board'' (referred to in this subtitle as
    the ``Board'').
        (b) Purposes.--The purposes of the Board are--
                (1) to promote the achievement of the purposes of this Act;
                (2) to observe the national greenhouse gas emission market
            and evaluate periods during which the cost of emission
            allowances provided under Federal law might pose significant
            harm to the economy; and
                (3) to submit to the President and Congress, and publish on
            the Internet, quarterly reports--
                        (A) describing--
                                (i) the status of the emission allowance
                            market established under this Act;
                                (ii) the economic cost and benefits of the
                            market, regional, industrial, and consumer
                            responses to the market;
                                (iii) where practicable, energy investment
                            responses to the market;
                                (iv) any corrective measures that should be
                            carried out to relieve excessive net costs of
                            the market;
                                (v) plans to compensate for those measures
                            to ensure that the long-term emission-reduction
                            goals of this Act are achieved; and
                                (vi) any instances of actual or potential
                            fraud on, or manipulation of, the market that
                            the Board has identified, and the effects of
                            such fraud or manipulation;
                        (B) that are timely and succinct to ensure regular
                    monitoring of market trends; and
                        (C) that are prepared independently by the Board.
        (c) Membership.--
                (1) Composition.--The Board shall be composed of--
                        (A) 7 members who are citizens of the United
                    States, to be appointed by the President, by and with
                    the advice and consent of the Senate; and
                        (B) an advisor who is a scientist with expertise in
                    climate change and the effects of climate change on the
                    environment, to be appointed by the President, by and
                    with the advice and consent of the Senate.
                (2) Requirements.--In appointing members of the Board under
            paragraph (1), the President shall--
                        (A) ensure fair representation of the financial,
                    agricultural, industrial, and commercial sectors, and
                    the geographical regions, of the United States, and
                    include a representative of consumer interests;
                        (B) appoint not more than 1 member from each such
                    geographical region; and
                        (C) ensure that not more than 4 members of the
                    Board serving at any time are affiliated with the same
                    political party.
                (3) Compensation.--
                        (A) In general.--A member of the Board shall be
                    compensated at a rate equal to the daily equivalent of
                    the annual rate of basic pay prescribed for level II of
                    the Executive Schedule under section 5313 of title 5,
                    United States Code, for each day (including travel
                    time) during which the member is engaged in the
                    performance of the duties of the Board.
                        (B) Chairperson.--The Chairperson of the Board
                    shall be compensated at a rate equal to the daily
                    equivalent of the annual rate of basic pay prescribed
                    for level I of the Executive Schedule under section
                    5312 of title 5, United States Code, for each day
                    (including travel time) during which the member is
                    engaged in the performance of the duties of the Board.
                (4) Prohibitions.--
                        (A) Conflicts of interest.--An individual employed
                    by, or holding any official relationship (including any
                    shareholder) with, any entity engaged in the
                    generation, transmission, distribution, or sale of
                    energy, an individual who has any pecuniary interest in
                    the generation, transmission, distribution, or sale of
                    energy, or an individual who has a pecuniary interest
                    in the implementation of this Act, shall not be
                    appointed to the Board under this subsection.
                        (B) No other employment.--A member of the Board
                    shall not hold any other employment during the term of
                    service of the member.
        (d) Term; Vacancies.--
                (1) Term.--
                        (A) In general.--The term of a member of the Board
                    shall be 14 years, except that the members first
                    appointed to the Board shall be appointed for terms in
                    a manner that ensures that--
                                (i) the term of not more than 1 member
                            shall expire during any 2-year period; and
                                (ii) no member serves a term of more than
                            14 years.
                        (B) Oath of office.--A member shall take the oath
                    of office of the Board by not later than 15 days after
                    the date on which the member is appointed under
                    subsection (c)(1).
                        (C) Removal.--
                                (i) In general.--A member may be removed
                            from the Board on determination of the
                            President for cause.
                                (ii) Notification.--Not later than 30 days
                            before removing a member from the Board for
                            cause under clause (i), the President shall
                            provide to Congress an advance notification of
                            the determination by the President to remove
                            the member.
                (2) Vacancies.--
                        (A) In general.--A vacancy on the Board--
                                (i) shall not affect the powers of the
                            Board; and
                                (ii) shall be filled in the same manner as
                            the original appointment was made.
                        (B) Service until new appointment.--A member of the
                    Board the term of whom has expired or otherwise been
                    terminated shall continue to serve until the date on
                    which a replacement is appointed under subparagraph
                    (A)(ii), if the President determines that service to be
                    appropriate.
        (e) Chairperson and Vice-Chairperson.--Of members of the Board, the
    President shall appoint--
                (1) 1 member to serve as Chairperson of the Board for a
            term of 4 years; and
                (2) 1 member to serve as Vice-Chairperson of the Board for
            a term of 4 years.
        (f) Meetings.--
                (1) Initial meeting.--The Board shall hold the initial
            meeting of the Board as soon as practicable after the date on
            which all members have been appointed to the Board under
            subsection (c)(1).
                (2) Presiding officer.--A meeting of the Board shall be
            presided over by--
                        (A) the Chairperson;
                        (B) in any case in which the Chairperson is absent,
                    the Vice-Chairperson; or
                        (C) in any case in which the Chairperson and Vice-
                    Chairperson are absent, a chairperson pro tempore, to
                    be elected by the members of the Board.
                (3) Quorum.--Four members of the Board shall constitute a
            quorum for a meeting of the Board.
                (4) Open meetings.--The Board shall be subject to section
            552b of title 5, United States Code (commonly known as the
            ``Government in the Sunshine Act'').
        (g) Records.--The Board shall be subject to section 552 of title 5,
    United States Code (commonly known as the ``Freedom of Information
    Act'').
        (h) Review by Government Accountability Office.--Not later than
    January 1, 2013, and annually thereafter, the Comptroller General of
    the United States shall conduct a review of the efficacy of the Board
    in fulfilling the purposes and duties of the Board under this subtitle.

    SEC. 2603. DUTIES.

        (a) Information Gathering.--
                (1) Authority.--The Board shall collect and analyze
            relevant market information to promote a full understanding of
            the dynamics of the emission allowance market established under
            this Act.
                (2) Information.--The Board shall gather such information
            as the Board determines to be appropriate regarding the status
            of the market, including information relating to--
                        (A) emission allowance allocation and availability;
                        (B) the price of emission allowances;
                        (C) macro- and micro-economic effects of unexpected
                    significant increases and decreases in emission
                    allowance prices, or shifts in the emission allowance
                    market, should those increases, decreases, or shifts
                    occur;
                        (D) economic effect thresholds that could warrant
                    implementation of cost relief measures described in
                    section 2604(a) after the initial 2-year period
                    described in subsection (d)(2);
                        (E) in the event any cost relief measures described
                    in section 2604(a) are taken, the effects of those
                    measures on the market;
                        (F) maximum levels of cost relief measures that are
                    necessary to achieve avoidance of economic harm and
                    preserve achievement of the purposes of this Act; and
                        (G) the success of the market in promoting
                    achievement of the purposes of this Act.
        (b) Treatment as Primary Activity.--
                (1) In general.--During the initial 2-year period of
            operation of the Board, information gathering under subsection
            (a) shall be the primary activity of the Board.
                (2) Subsequent authority.--After the 2-year period
            described in paragraph (1), the Board shall assume authority to
            implement the cost-relief measures described in section
            2604(a).
        (c) Study.--
                (1) In general.--During the 2-year period beginning on the
            date on which the emission allowance market established under
            this Act begins operation, the Board shall conduct a study of
            other markets for tradeable permits to emit covered greenhouse
            gases.
                (2) Report.--Not later than 180 days after the beginning of
            the period described in paragraph (1), the Board shall submit
            to Congress, and publish on the Internet, a report describing
            the status of the market, specifically with respect to
            volatility within the market and the average price of emission
            allowances during that 180-day period.
        (d) Employment of Cost Relief Measures.--
                (1) In general.--If the Board determines that the emission
            allowance market established under this Act poses a significant
            harm to the economy of the United States, the Board shall carry
            out such cost relief measures relating to that market as the
            Board determines to be appropriate under section 2604(a).
                (2) Initial period.--During the 2-year period beginning on
            the date on which the emission allowance market established
            under this Act begins operation, if the Board determines that
            the average daily closing price of emission allowances during a
            180-day period exceeds the upper range of the estimate provided
            under section 2605, the Board shall--
                        (A) increase the quantity of emission allowances
                    that covered facilities may borrow from the prescribed
                    allocations of the covered facilities for future years;
                    and
                        (B) take subsequent action as described in section
                    2604(a)(2).
                (3) Requirements.--Any action carried out pursuant to this
            subsection shall be subject to the requirements of section
            2604(a)(3)(B).
        (e) Reports.--The Board shall submit to the President and Congress
    quarterly reports--
                (1) describing the status of the emission allowance market
            established under this Act, the economic effects of the market,
            regional, industrial, and consumer responses to the market,
            energy investment responses to the market, the effects on the
            market of any fraud on, or manipulation of, the market that the
            Board has identified, any corrective measures that should be
            carried out to relieve excessive costs of the market, and plans
            to compensate for those measures; and
                (2) that are prepared independently by the Board, and not
            in partnership with Federal agencies.

    SEC. 2604. POWERS.

        (a) Cost Relief Measures.--
                (1) In general.--Beginning on the day after the date of
            expiration of the 2-year period described in section 2603(b),
            the Board may carry out 1 or more of the following cost relief
            measures to ensure functioning, stable, and efficient markets
            for emission allowances:
                        (A) Increase the quantity of emission allowances
                    that covered facilities may borrow from the prescribed
                    allocations of the covered facilities for future years.
                        (B) Expand the period during which a covered
                    facility may repay the Administrator for an emission
                    allowance as described in subparagraph (A).
                        (C) Lower the interest rate at which an emission
                    allowance may be borrowed as described in subparagraph
                    (A).
                        (D) Increase the quantity of emission allowances
                    obtained on a foreign greenhouse gas emissions trading
                    market that the owner or operator of any covered
                    facility may use to satisfy the allowance submission
                    requirement of the covered facility under section
                    1202(a), on the condition that the Administrator has
                    certified the market in accordance with the regulations
                    promulgated pursuant to section 2502(a).
                        (E) Increase the quantity of offset allowances
                    generated in accordance with subtitle D that the owner
                    or operator of any covered facility may use to satisfy
                    the total allowance submission requirement of the
                    covered facility under section 1202(a).
                        (F) Expand the total quantity of emission
                    allowances made available to all covered facilities at
                    any given time by borrowing against the total allowable
                    quantity of emission allowances to be provided for
                    future years.
                (2) Subsequent actions.--On determination by the Board to
            carry out a cost relief measure pursuant to paragraph (1), the
            Board shall--
                        (A) allow the cost relief measure to be used only
                    during the applicable allocation year;
                        (B) exercise the cost relief measure incrementally,
                    and only as needed to avoid significant economic harm
                    during the applicable allocation year;
                        (C) specify the terms of the relief to be achieved
                    using the cost relief measure, including requirements
                    for entity-level or national market-level compensation
                    to be achieved by a specific date or within a specific
                    time period;
                        (D) in accordance with section 2603(e), submit to
                    the President and Congress a report describing the
                    actions carried out by the Board and recommendations
                    for the terms under which the cost relief measure
                    should be authorized by Congress and carried out by
                    Federal entities; and
                        (E) evaluate, at the end of the applicable
                    allocation year, actions that need to be carried out
                    during subsequent years to compensate for any cost
                    relief measure carried out during the applicable
                    allocation year.
                (3) Action on expansion of borrowing.--
                        (A) In general.--If the Board carries out a cost
                    relief measure pursuant to paragraph (1) that results
                    in the expansion of borrowing of emission allowances
                    under this Act, and if the average daily closing price
                    of emission allowances for the 180-day period beginning
                    on the date on which borrowing is so expanded exceeds
                    the upper range of the estimate provided under section
                    2605, the Board shall increase the quantity of emission
                    allowances available for the applicable allocation year
                    in accordance with this paragraph.
                        (B) Requirements.--An increase in the quantity of
                    emission allowances under subparagraph (A) shall--
                                (i) apply to all covered facilities;
                                (ii) be allocated in accordance with the
                            applicable formulas and procedures established
                            under this Act;
                                (iii) be equal to not more than 5 percent
                            of the total quantity of emission allowances
                            otherwise available for the applicable
                            allocation year under this Act;
                                (iv) remain in effect only for the
                            applicable allocation year;
                                (v) specify the date by which the increase
                            shall be repaid by covered facilities through a
                            proportionate reduction of emission allowances
                            available for subsequent allocation years; and
                                (vi) require the repayment under clause (v)
                            to be made by not later than the date that is
                            15 years after the date on which the increase
                            is provided.
        (b) Assessments.--Not more frequently than semiannually, the Board
    may levy on owners and operators of covered facilities an assessment
    sufficient to pay the estimated expenses of the Board and the salaries
    of members of and employees of the Board during the 180-day period
    beginning on the date on which the assessment is levied, taking into
    account any deficit carried forward from the preceding 180-day period.
        (c) Limitations.--Nothing in this section gives the Board the
    authority--
                (1) to consider or prescribe entity-level petitions for
            relief from the costs of an emission allowance allocation or
            trading program established under Federal law;
                (2) to carry out any investigative or punitive process
            under the jurisdiction of any Federal or State court;
                (3) to interfere with, modify, or adjust any emission
            allowance allocation scheme established under Federal law; or
                (4) to modify the total quantity of emission allowances
            issued under this Act for the period of calendar years 2012
            through 2050.

    SEC. 2605. ESTIMATE OF COSTS TO ECONOMY OF LIMITING GREENHOUSE GAS
                  EMISSIONS.

        Not later than July 1, 2014, the Director of the Congressional
    Budget Office, using economic and scientific analyses, shall submit to
    Congress a report that describes--
                (1) the projected price range at which emission allowances
            are expected to trade during the 2-year period of the initial
            greenhouse gas emission market established under Federal law;
            and
                (2) the projected impact of that market on the economy of
            the United States.

               TITLE III--ALLOCATING AND DISTRIBUTING ALLOWANCES

                              Subtitle A--Auctions

    SEC. 3101. ALLOCATION FOR EARLY AUCTIONS.

        Not later than 180 days after the date of enactment of this Act,
    the Administrator shall allocate 5 percent of the emission allowances
    established for calendar year 2012, 3 percent of the emission
    allowances established for calendar year 2013, and 1 percent of the
    emissions established for calendar 2014, to the Corporation for early
    auctioning in accordance with section 4301.

    SEC. 3102. ALLOCATION FOR ANNUAL AUCTIONS.

        Not later than April 1, 2011, and annually thereafter through
    calendar year 2049, the Administrator shall allocate to the Corporation
    for annual auctioning a percentage of emission allowances for the
    following calendar year, as follows:

    ----------------------------------------------------------------------------------------------------------------
                                                                                   Percentage of Emission Allowance
                                   Calendar Year                                       Account Allocated to the
                                                                                             Corporation
    ----------------------------------------------------------------------------------------------------------------
    2012                                                                                                       21.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2013                                                                                                       24.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2014                                                                                                       27.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2015                                                                                                       29.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2016                                                                                                       30.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2017                                                                                                       31.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2018                                                                                                       33.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2019                                                                                                       34.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2020                                                                                                       36.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2021                                                                                                      39.75
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2022                                                                                                         41
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2023                                                                                                      43.25
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2024                                                                                                      45.75
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2025                                                                                                       48.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2026                                                                                                       51.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2027                                                                                                       55.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2028                                                                                                       58.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2029                                                                                                       61.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2030                                                                                                      62.75
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2031                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2032                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2033                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2034                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2035                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2036                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2037                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2038                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2039                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2040                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2041                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2042                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2043                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2044                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2045                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2046                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2047                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2048                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2049                                                                                                       69.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2050                                                                                                       69.5
    ----------------------------------------------------------------------------------------------------------------

                            Subtitle B--Early Action

    SEC. 3201. ALLOCATION.

        Not later than 2 years after the date of enactment of this Act, the
    Administrator shall allocate to owners or operators of covered
    facilities and other facilities that emit greenhouse gas, in
    recognition of actions of the owners and operators taken since January
    1, 1994, that resulted in verified and credible reductions of
    greenhouse gas emissions--
                (1) 5 percent of the emission allowances established for
            calendar year 2012;
                (2) 4 percent of the emission allowances established for
            calendar year 2013;
                (3) 3 percent of the emission allowances established for
            calendar year 2014;
                (4) 2 percent of the emission allowances established for
            calendar year 2015; and
                (5) 1 percent of the emission allowances established for
            calendar year 2016.

    SEC. 3202. DISTRIBUTION.

        (a) In General.--Not later than 1 year after the date of enactment
    of this Act, the Administrator shall establish, by regulation,
    procedures and standards for use in distributing, to owners and
    operators of covered facilities and other facilities that emit
    greenhouse gas, emission allowances allocated under section 3201.
        (b) Consideration.--The procedures and standards established under
    subsection (a) shall provide for consideration of verified and credible
    emission reductions registered before the date of enactment of this Act
    under--
                (1) the Climate Leaders Program, or any other voluntary
            greenhouse gas reduction program of the United States
            Environmental Protection Agency and United States Department of
            Energy;
                (2) the Voluntary Reporting of Greenhouse Gases Program of
            the Energy Information Administration;
                (3) State or regional greenhouse gas emission reduction
            programs that include systems for tracking and verifying the
            greenhouse gas emission reductions; and
                (4) voluntary entity programs that resulted in entity-wide
            reductions in greenhouse gas emissions.
        (c) Distribution.--Not later than 4 years after the date of
    enactment of this Act, the Administrator shall distribute all emission
    allowances allocated under section 3201.

                               Subtitle C--States

    SEC. 3301. ALLOCATION FOR ENERGY SAVINGS.

        (a) Allocation.--Not later than April 1, 2011, and annually
    thereafter through calendar year 2049, the Administrator shall allocate
    2 percent of the Emission Allowance Account for the following calendar
    year among States that have adopted regulations by not later than the
    date on which the allowance allocations are made, that subject
    regulated natural gas and electric utilities that deliver gas or
    electricity in those States to regulations that--
                (1) automatically adjust the rates charged by natural gas
            and electric utilities to fully recover fixed costs of service
            without regard to whether their actual sales are higher or
            lower than the forecast of sales on which the tariffed rates
            were based; and
                (2) make cost-effective energy-efficiency expenditures by
            investor-owned natural gas or electric utilities at least as
            rewarding to their shareholders as power or energy purchases,
            or expenditures on new energy supplies or infrastructure.
        (b) Allocation for Building Efficiency.--Not later than January 1,
    2012, and annually thereafter through January 1, 2050, the
    Administrator shall allocate 1 percent of the Emission Allowance
    Account among States that are in compliance with section 304(c) of the
    Energy Conservation and Production Act (as amended by section 5201).
        (c) Distribution.--Not later than 2 years after the date of
    enactment of this Act, the Administrator shall establish procedures and
    standards for the distribution of emission allowances to States in
    accordance with subsections (a) and (b).
        (d) Use.--Any State receiving emission allowances under this
    section for a calendar year shall retire or use, in 1 or more of the
    ways described in section 3303(c)(1), not less than 90 percent of the
    emission allowances allocated to the State (or proceeds of the sale of
    those allowances) under this section for the calendar year.

    SEC. 3302. ALLOCATION FOR STATES WITH PROGRAMS THAT EXCEED FEDERAL
                  EMISSION REDUCTION TARGETS.

        (a) Allocation.--Not later than April 1, 2011, and annually
    thereafter through calendar year 2049, the Administrator shall allocate
    2 percent of the Emission Allowance Account for the following calendar
    year among States that have--
                (1) before the date of enactment of this Act, enacted
            statewide greenhouse gas emission reduction targets that are
            more stringent than the nationwide targets established under
            title II; and
                (2) by the time of an allocation under this subsection,
            imposed on covered facilities within the States aggregate
            greenhouse gas emission limitations more stringent than those
            imposed on covered facilities under title II.
        (b) Distribution.--Not later than 2 years after the date of
    enactment of this Act, the Administrator shall establish procedures and
    standards for use in distributing emission allowances among States in
    accordance with subsection (a).
        (c) Use.--Any State receiving emission allowances under this
    section for a calendar year shall retire or use, in 1 or more of the
    ways described in section 3303(c)(1), not less than 90 percent of the
    emission allowances allocated to the State (or proceeds of the sale of
    those allowances) under this section for the calendar year.

    SEC. 3303. GENERAL ALLOCATION.

        (a) Allocation.--Subject to subsection (d)(3), not later than April
    1, 2011, and annually thereafter through calendar year 2049, the
    Administrator shall allocate 5 percent of the Emission Allowance
    Account for the following calendar year among States.
        (b) Distribution.--The allowances available for allocation to
    States under subsection (a) for a calendar year shall be distributed as
    follows:
                (1) For each calendar year, \1/3\ of the quantity of
            allowances available for allocation to States under subsection
            (a) shall be distributed among individual States based on the
            proportion that--
                        (A) the expenditures of a State for the low-income
                    home energy assistance program established under the
                    Low-Income Home Energy Assistance Act of 1981 (42
                    U.S.C. 8621 et seq.) for the preceding calendar year;
                    bears to
                        (B) the expenditures of all States for that program
                    for the preceding calendar year.
                (2) For each calendar year, \1/3\ of the quantity of
            allowances available for allocation to States under subsection
            (a) shall be distributed among the States based on the
            proportion that--
                        (A) the population of a State, as determined by the
                    most recent decennial census preceding the calendar
                    year for which the allocation regulations are for the
                    allocation year; bears to
                        (B) the population of all States, as determined by
                    that census.
                (3) For each calendar year, \1/3\ of the quantity of
            allowances available for allocation to States under subsection
            (a) shall be distributed among the States based on the
            proportion that--
                        (A) the quantity of carbon dioxide that would be
                    emitted assuming that all of the coal that is mined,
                    natural gas that is processed, and petroleum that is
                    refined within the boundaries of a State during the
                    preceding year is completely combusted and that none of
                    the carbon dioxide emissions are captured, as
                    determined by the Secretary of Energy; bears to
                        (B) the aggregate quantity of carbon dioxide that
                    would be emitted assuming that all of the coal that is
                    mined, natural gas that is processed, and petroleum
                    that is refined in all States for the preceding year is
                    completely combusted and that none of the carbon
                    dioxide emissions are captured, as determined by the
                    Secretary of Energy.
        (c) Use.--
                (1) In general.--During any calendar year, a State shall
            retire or use in 1 or more of the following ways not less than
            90 percent of the allowances allocated to the State (or
            proceeds of sale of those emission allowances) under this
            section for that calendar year:
                        (A) To mitigate impacts on low-income energy
                    consumers.
                        (B) To promote energy efficiency (including support
                    of electricity and natural gas demand reduction, waste
                    minimization, and recycling programs).
                        (C) To promote investment in nonemitting
                    electricity generation technology, including planning
                    for the siting of facilities employing that technology
                    in States (including territorial waters of States).
                        (D) To improve public transportation and passenger
                    rail service and otherwise promote reductions in
                    vehicle miles traveled.
                        (E) To encourage advances in energy technology that
                    reduce or sequester greenhouse gas emissions.
                        (F) To address local or regional impacts of climate
                    change, including by accommodating, protecting, or
                    relocating affected communities and public
                    infrastructure.
                        (G) To collect, evaluate, disseminate, and use
                    information necessary for affected coastal communities
                    to adapt to climate change (such as information derived
                    from inundation prediction systems).
                        (H) To mitigate obstacles to investment by new
                    entrants in electricity generation markets and energy-
                    intensive manufacturing sectors.
                        (I) To address local or regional impacts of climate
                    change policy, including providing assistance to
                    displaced workers.
                        (J) To mitigate impacts on energy-intensive
                    industries in internationally competitive markets.
                        (K) To reduce hazardous fuels, and to prevent and
                    suppress wildland fire.
                        (L) To fund rural, municipal, and agricultural
                    water projects that are consistent with the sustainable
                    use of water resources.
                        (M) To fund any other purpose the States determine
                    to be necessary to mitigate any negative economic
                    impacts as a result of--
                                (i) global warming; or
                                (ii) new regulatory requirements as a
                            result of this Act.
                (2) Deadline.--A State shall distribute or sell allowances
            for use in accordance with paragraph (1) by not later than the
            beginning of each allowance allocation year.
                (3) Return of allowances.--Not later than 330 days before
            the end of each allowance allocation year, a State shall return
            to the Administrator any allowances not distributed by the
            deadline under paragraph (2).
                (4) Use for recycling.--During any calendar year, a State
            shall retire or use not less than 5 percent of the emission
            allowances allocated to the State (or proceeds of sale of those
            emission allowances) under this section for increasing
            recycling rates through activities such as--
                        (A) improving recycling infrastructure;
                        (B) increasing public education on the benefits of
                    recycling, particularly with respect to greenhouse
                    gases;
                        (C) improving residential, commercial, and
                    industrial collection of recyclables;
                        (D) improving recycling system efficiency;
                        (E) increasing recycling yields; and
                        (F) improving the quality and usefulness of
                    recycled materials.
        (d) Program for Tribal Communities.--
                (1) Establishment.--Not later than 3 years after the date
            of enactment of this Act, the Administrator, in consultation
            with the Secretary of the Interior, shall by regulation
            establish a program for tribal communities--
                        (A) that is designed to deliver assistance to
                    tribal communities within the United States that face
                    disruption or dislocation as a result of global climate
                    change; and
                        (B) under which the Administrator shall distribute
                    0.5 percent of the Emission Allowance Account for each
                    calendar among tribal governments of the tribal
                    communities described in subparagraph (A).
                (2) Allocation.--Beginning in the first calendar year that
            begins after promulgation of the regulations referred to in
            paragraph (1), and annually thereafter until calendar year
            2050, the Administrator shall allocate 0.5 percent of the
            Emission Allowance Account for each calendar year to the
            program established under paragraph (1).

    SEC. 3304. ALLOCATION FOR MASS TRANSIT.

        (a) Allocation.--Not later than April 1, 2011, and annually
    thereafter through calendar year 2049, the Administrator shall allocate
    1 percent of the Emission Allowance Account for the following calendar
    year among States.
        (b) Distribution.--The emission allowances available for allocation
    to States under subsection (a) for a calendar year shall be distributed
    among the States based on the formula established in section
    104(b)(1)(A) of title 23, United States Code.
        (c) Use.--During any calendar year, a State receiving emission
    allowances under this section shall--
                (1) use the emission allowances (or proceeds of sale of
            those emission allowances) only for--
                        (A) the operating costs of State and municipal mass
                    transit systems;
                        (B) efforts to increase mass transit service and
                    ridership in the State, including by adding new mass
                    transit systems; and
                        (C) efforts to increase the efficiency of mass
                    transit systems through the development, purchase, or
                    deployment of innovative technologies that reduce
                    emissions of greenhouse gases; and
                (2) shall ensure that use of the emission allowances (or
            proceeds of sale of those emission allowances) by the State for
            the purposes described in paragraph (1) is geographically
            distributed as follows:
                        (A) At least 60 percent in urban areas.
                        (B) At least 20 percent in areas that are not urban
                    areas.
                        (C) 20 percent as the State determines to be
                    appropriate.
        (d) Return of Unused Emission Allowances.--Any State receiving
    emission allowances under this section shall return to the
    Administrator any such emission allowance that the State has failed to
    use in accordance with subsection (c) by not later than 5 years after
    the date of receipt of the emission allowance from the Administrator.
        (e) Use of Returned Emission Allowances.--The Administrator shall
    immediately transfer to the Corporation for auctioning under section
    4302 any emission allowances returned to the Administrator under
    subsection (d).

                       Subtitle D--Electricity Consumers

    SEC. 3401. ALLOCATION.

        Not later than April 1, 2011, and annually thereafter through
    calendar year 2049, the Administrator shall allocate among load-serving
    entities 9 percent of the Emission Allowance Account for the following
    calendar year.

    SEC. 3402. DISTRIBUTION.

        (a) In General.--For each calendar year, the emission allowances
    allocated under section 3401 shall be distributed by the Administrator
    to each load-serving entity, including each rural electric cooperative
    that serves as a load-serving entity in a State that is not a
    participant in the pilot program established under section 3903(a),
    based on the proportion that--
                (1) the quantity of electricity delivered by the load-
            serving entity during the 3 calendar years preceding the
            calendar year for which the emission allowances are
            distributed, adjusted upward for electricity not delivered as a
            result of consumer energy-efficiency programs implemented by
            the load-serving entity and verified by the regulatory agency
            of the load-serving entity; bears to
                (2) the total quantity of electricity delivered by all
            load-serving entities during those 3 calendar years.
        (b) Basis.--The Administrator shall base the determination of the
    quantity of electricity delivered by a load-serving entity for the
    purpose of subsection (a) on the most recent data available in annual
    reports filed with the Energy Information Administration of the
    Department of Energy.

    SEC. 3403. USE.

        (a) In General.--Any load-serving entity that accepts emission
    allowances distributed under section 3402 shall--
                (1) sell each emission allowance distributed to the load-
            serving entity by not later than 1 year after receiving the
            emission allowance; and
                (2) pursue fair market value for each emission allowance
            sold in accordance with paragraph (1).
        (b) Proceeds.--All proceeds from the sale of emission allowances
    under subsection (a) shall be used solely--
                (1) to mitigate economic impacts on low- and middle-income
            energy consumers, including by reducing transmission charges or
            issuing rebates; and
                (2) to promote energy efficiency on the part of energy
            consumers.
        (c) Prohibition on Rebates.--No load-serving entity may use any
    proceeds from the sale of emission allowances under subsection (a) to
    provide to any consumer a rebate that is based on the quantity of
    electricity used by the consumer.

    SEC. 3404. REPORTING.

        (a) In General.--Each load-serving entity that accepts emission
    allowances distributed under section 3402 shall, for each calendar year
    for which the load-serving entity accepts emission allowances, submit
    to the Administrator a report describing--
                (1) the date of each sale of each emission allowance during
            the preceding year;
                (2) the amount of revenue generated from the sale of
            emission allowances during the preceding year; and
                (3) how, and to what extent, the load-serving entity used
            the proceeds of the sale of the emission allowances during the
            preceding year.
        (b) Availability of Reports.--The Administrator shall make
    available to the public all reports submitted by any load-serving
    entity under subsection (b), including by publishing those reports on
    the Internet.

                       Subtitle E--Natural Gas Consumers

    SEC. 3501. ALLOCATION.

        Not later than April 1, 2011, and annually thereafter through
    calendar year 2049, the Administrator shall allocate among natural gas
    local distribution companies 2 percent of the Emission Allowance
    Account for the following calendar year.

    SEC. 3502. DISTRIBUTION.

        For each calendar year, the emission allowances allocated under
    section 3501 shall be distributed by the Administrator to each natural
    gas local distribution company based on the proportion that--
                (1) the quantity of natural gas delivered by the natural
            gas local distribution company during the 3 calendar years
            preceding the calendar year for which the emission allowances
            are distributed, adjusted upward for natural gas not delivered
            as a result of consumer energy-efficiency programs implemented
            by the natural gas local distribution company and verified by
            the regulatory agency of the natural gas local distribution
            company; bears to
                (2) the total quantity of natural gas delivered by all
            natural gas local distribution companies during those 3
            calendar years.

    SEC. 3503. USE.

        (a) In General.--Any natural gas local distribution company that
    accepts emission allowances distributed under section 3502 shall--
                (1) sell each emission allowance distributed to the natural
            gas local distribution company by not later than 1 year after
            receiving the emission allowance; and
                (2) pursue fair market value for each emission allowance
            sold in accordance with paragraph (1).
        (b) Proceeds.--All proceeds from the sale of emission allowances
    under subsection (a) shall be used solely--
                (1) to mitigate economic impacts on low- and middle-income
            energy consumers; and
                (2) to promote energy efficiency on the part of energy
            consumers.
        (c) Prohibition on Rebates.--No natural gas local distribution
    company may use any proceeds from the sale of emission allowances under
    subsection (a) to provide to any consumer a rebate that is based on the
    quantity of natural gas used by the consumer.

    SEC. 3504. REPORTING.

        (a) In General.--Each natural gas local distribution company that
    accepts emission allowances distributed under section 3502 shall, for
    each calendar year for which the natural gas local distribution company
    accepts emission allowances, submit to the Administrator a report
    describing--
                (1) the date of each sale of each emission allowance during
            the preceding year;
                (2) the amount of revenue generated from the sale of
            emission allowances during the preceding year; and
                (3) how, and to what extent, the natural gas local
            distribution company used the proceeds of the sale of the
            emission allowances during the preceding year.
        (b) Availability of Reports.--The Administrator shall make
    available to the public all reports submitted by any natural gas local
    distribution company under subsection (a), including by publishing
    those reports on the Internet.

        Subtitle F--Bonus Allowances for Carbon Capture and Geological
                                 Sequestration

    SEC. 3601. ALLOCATION.

        Not later than 3 years after the date of enactment of this Act, the
    Administrator shall--
                (1) establish a Bonus Allowance Account; and
                (2) allocate 4 percent of the emission allowances
            established for calendar years 2012 through 2030 to the Bonus
            Allowance Account.

    SEC. 3602. QUALIFYING PROJECTS.

        (a) Definitions.--In this section:
                (1) Commenced.--The term ``commenced'', with respect to
            construction, means that an owner or operator has obtained the
            necessary permits to undertake a continuous program of
            construction and has entered into a binding contractual
            obligation, with substantial financial penalties for
            cancellation, to undertake such a program.
                (2) Construction.--The term ``construction'' means the
            fabrication, erection, or installation of the technology for
            the carbon capture and sequestration project.
        (b) Eligibility.--To be eligible to receive emission allowances
    under this subtitle, a carbon capture and sequestration project shall--
                (1) comply with such criteria and procedures as the
            Administrator may establish, including a requirement, as
            prescribed in subsection (c), for an annual emissions
            performance standard for carbon dioxide emissions from any unit
            for which allowances are allocated;
                (2) sequester, in a geological formation permitted by the
            Administrator for that purpose in accordance with regulations
            promulgated under part C of the Safe Drinking Water Act (42
            U.S.C. 300h et seq.), carbon dioxide captured from any unit for
            which allowances are allocated; and
                (3) have begun operation during the period beginning on
            January 1, 2008, and ending on December 31, 2035.
        (c) Emission Performance Standards.--Subject to subsection (d), a
    carbon capture and sequestration project shall be eligible to receive
    emission allowances under this subtitle only if the project achieves 1
    of the following emissions performance standards for limiting carbon
    dioxide emissions from the unit on an annual average basis:
                (1) For an electric generation unit that is not a new
            entrant, an annual emissions rate of not more than 1,200 pounds
            of carbon dioxide per megawatt-hour of net electricity
            generation, after subtracting the carbon dioxide that is
            captured and sequestered.
                (2) For a new entrant electric generation unit for which
            construction of the unit commenced prior to July 1, 2018, an
            annual emissions rate of not more than 800 pounds of carbon
            dioxide per megawatt-hour of net electricity generation, after
            subtracting the carbon dioxide that is captured and
            sequestered.
                (3) For a new entrant electric generation unit for which
            construction of the unit commenced on or after July 1, 2018, an
            annual emissions rate of not more than 350 pounds of carbon
            dioxide per megawatt-hour of net electricity generation, after
            subtracting the carbon dioxide that is captured and
            sequestered.
                (4) For any unit at a covered facility that is not an
            electric generation unit, an annual emissions rate that is
            achieved by the capture and sequestration of a minimum of 85
            percent of the total carbon dioxide emissions produced by the
            unit.
        (d) Adjustment of Performance Standards.--
                (1) In general.--The Corporation may adjust the emissions
            performance standard for a carbon capture and sequestration
            project under subsection (c) for an electric generation unit
            that uses subbituminous coal, lignite, or petroleum coke in
            significant amounts.
                (2) Requirement.--In any case described in paragraph (1),
            the performance standard for the project shall prescribe an
            annual emissions rate that requires the project to achieve an
            equivalent reduction from uncontrolled carbon dioxide emissions
            levels from the use of subbituminous coal, lignite, or
            petroleum coke, as compared to the emissions that the project
            would have achieved if that unit had combusted only bituminous
            coal during the particular year.

    SEC. 3603. DISTRIBUTION.

        (a) In General.--Subject to section 3604, for each of calendar
    years 2012 through 2039, the Administrator shall distribute emission
    allowances from the Bonus Allowance Account to each qualifying project
    under this subtitle in a quantity equal to the product obtained by
    multiplying--
                (1) the bonus allowance adjustment factor, as determined
            under subsection (b);
                (2) the number of metric tons of carbon dioxide emissions
            avoided through capture and geologic sequestration of emissions
            by the project; and
                (3) the bonus allowance rate for that calendar year, as
            provided in the following table:

                              Year                                             Bonus Allowance Rate

    2012                                                     4.5
    2013                                                     4.5
    2014                                                     4.5
    2015                                                     4.5
    2016                                                     4.5
    2017                                                     4.5
    2018                                                     4.2
    2019                                                     3.9
    2020                                                     3.6
    2021                                                     3.3
    2022                                                     3.0
    2023                                                     2.7
    2024                                                     2.4
    2025                                                     2.1
    2026                                                     1.8
    2027                                                     1.5
    2028                                                     1.3
    2029                                                     1.1
    2030                                                     0.9
    2031                                                     0.7
    2032                                                     0.5
    2033                                                     0.5
    2034                                                     0.5
    2035                                                     0.5
    2036                                                     0.5
    2037                                                     0.5
    2038                                                     0.5
    2039                                                     0.5

        (b) Bonus Allowance Adjustment Ratio.--The Administrator shall
    determine the bonus allowance adjustment factor by dividing a carbon
    dioxide emissions rate of 350 pounds per megawatt-hour by the annual
    carbon dioxide emissions rate, on a pounds per megawatt-hour basis,
    that a qualifying project at the electric generation unit achieved
    during a particular year, except that--
                (1) the factor shall be equal to 1 in the case of a project
            that qualifies under section 3602(c)(1) during the first 4
            years that emissions allowances are distributed to the project;
            and
                (2) the factor shall not exceed 1 for any qualifying
            project.

    SEC. 3604. 10-YEAR LIMIT.

        A qualifying project may receive annual emission allowances under
    this subsection only for--
                (1) the first 10 years of operation; or
                (2) if the unit covered by the qualifying project began
            operating before January 1, 2012, the period of calendar years
            2012 through 2021.

    SEC. 3605. EXHAUSTION OF BONUS ALLOWANCE ACCOUNT.

        If, at the beginning of a calendar year, the Administrator
    determines that the number of emission allowances remaining in the
    Bonus Allowance Account will be insufficient to allow the distribution,
    in that calendar year, of the number of allowances that otherwise would
    be distributed under section 3603 for the calendar year, the
    Administrator shall, for the calendar year--
                (1) distribute the remaining bonus allowances only to
            qualifying projects that were already qualifying projects
            during the preceding calendar year;
                (2) distribute the remaining bonus allowances to those
            qualifying projects on a pro rata basis; and
                (3) discontinue the program established under this subtitle
            as of the date on which the Bonus Allowance Account is
            projected to be fully used based on projects already in
            operation.

                 Subtitle G--Domestic Agriculture and Forestry

    SEC. 3701. ALLOCATION.

        Not later than April 1, 2011, and annually thereafter through
    calendar year 2049, the Administrator shall allocate to the Secretary
    of Agriculture 5 percent of the Emission Allowance Account for the
    following calendar year for use in--
                (1) achieving real, verifiable, additional, permanent, and
            enforceable reductions in greenhouse gas emissions from the
            agriculture and forestry sectors of the United States economy;
            and
                (2) achieving real, verifiable, additional, permanent, and
            enforceable increases in greenhouse gas sequestration from
            those sectors.

    SEC. 3702. AGRICULTURAL AND FORESTRY GREENHOUSE GAS MANAGEMENT
                  RESEARCH.

        (a) Report.--Not later than 1 year after the date of enactment of
    this Act, the Secretary of Agriculture, in consultation with scientific
    and agricultural and forestry experts, shall prepare and submit to
    Congress a report that describes the status of research on agricultural
    and forestry greenhouse gas management, including a description of--
                (1) research on soil carbon sequestration and other
            agricultural and forestry greenhouse gas management that has
            been carried out;
                (2) any additional research that is necessary;
                (3) the proposed priority for additional research;
                (4) the most appropriate approaches for conducting the
            additional research; and
                (5) the extent to which and the manner in which carbon
            credits that are specific to agricultural and forestry
            operations, including harvested wood products and the reduction
            of hazardous fuels to reduce the risk of uncharacteristically
            severe wildfires, should be valued and allotted.
        (b) Standardized System of Soil Carbon Measurement and
    Certification for the Agricultural and Forestry Sectors.--
                (1) In general.--As soon as practicable after the date of
            enactment of this Act, the Secretary of Agriculture shall
            establish a standardized system of carbon measurement and
            certification for the agricultural and forestry sectors.
                (2) Administration.--In establishing the system, the
            Secretary of Agriculture shall--
                        (A) create a standardized system of measurements
                    for agricultural and forestry greenhouse gases; and
                        (B) delineate the most appropriate system of
                    certification of credit by public or private entities.
        (c) Research.--After the date of submission of the report described
    in paragraph (1), the President and the Secretary of Agriculture (in
    collaboration with the member institutions of higher education of the
    Consortium for Agricultural Soil Mitigation of Greenhouse Gases,
    institutions of higher education, and research entities) shall initiate
    a program to conduct any additional research that is necessary.

    SEC. 3703. DISTRIBUTION.

        (a) In General.--Taking into account the report prepared under
    section 3702(a), the Secretary of Agriculture shall establish, by
    regulation, a program under which agricultural and forestry allowances
    may be distributed to entities that carry out projects on agricultural
    and forest land that achieve real, verifiable, additional, permanent,
    and enforceable greenhouse gas emission mitigation benefits.
        (b) Nitrous Oxide and Methane.--The Secretary of Agriculture shall
    ensure that, during any 5-year period, the average annual percentage of
    the Emission Allowance Account that is distributed to entities under
    the program established under subsection (a) specifically for achieving
    real, verifiable, additional, permanent, and enforceable reductions in
    nitrous oxide emissions through soil management or achieving real,
    verifiable, additional, permanent, and enforceable reductions in
    methane emissions through enteric fermentation and manure management
    shall be 0.5 percent.
        (c) Requirement.--The Administrator shall distribute emission
    allowances under this section in a manner that maximizes the avoidance
    or reduction of greenhouse gas emissions.

                  Subtitle H--International Forest Protection

    SEC. 3801. FINDINGS.

        Congress finds that--
                (1) land-use change and forest sector emissions account for
            approximately 20 percent of global greenhouse gas emissions;
                (2) land conversion and deforestation are 2 of the largest
            sources of greenhouse gas emissions in the developing world,
            amounting to roughly 40 percent of the total greenhouse gas
            emissions of the developing world;
                (3) with sufficient data, deforestation rates and forest
            carbon stocks can be measured with an acceptable level of
            uncertainty; and
                (4) encouraging reduced deforestation and other forest
            carbon activities in other countries can--
                        (A) provide critical leverage to encourage
                    voluntary developing country participation in emission
                    limitation regimes;
                        (B) facilitate greater overall reductions in
                    greenhouse gas emissions than would otherwise be
                    practicable; and
                        (C) substantially benefit biodiversity,
                    conservation, and indigenous and other forest-dependent
                    people in developing countries.

    SEC. 3802. DEFINITION OF FOREST CARBON ACTIVITIES.

        In this subtitle, the term ``forest carbon activities'' means--
                (1) activities directed at reducing greenhouse gas
            emissions from deforestation and forest degradation in
            countries other than the United States; and
                (2) activities directed at increasing sequestration of
            carbon through restoration of forests, and degraded land in
            countries other than the United States that has not been
            forested prior to restoration, afforestation, and improved
            forest management, that meet the eligibility requirements
            promulgated under section 3804(a).

    SEC. 3803. ALLOCATION.

        Not later than April 1, 2011, and annually thereafter through
    calendar year 2049, the Administrator shall allocate and distribute 2.5
    percent of the Emission Allowance Account for the following calendar
    year for use in carrying out forest carbon activities in countries
    other than the United States.

    SEC. 3804. DEFINITION AND ELIGIBILITY REQUIREMENTS.

        (a) Eligibility Requirements for Forest Carbon Activities.--Not
    later than 2 years after the date of enactment of this Act, the
    Administrator, in consultation with the Secretary of the Interior, the
    Secretary of State, and the Secretary of Agriculture, shall promulgate
    eligibility requirements for forest carbon activities directed at
    reducing emissions from deforestation and forest degradation, and at
    sequestration of carbon through restoration of forests and degraded
    land, afforestation, and improved forest management in countries other
    than the United States, including requirements that those activities
    be--
                (1) carried out and managed in accordance with widely-
            accepted environmentally sustainable forestry practices; and
                (2) designed--
                        (A) to promote native species and restoration of
                    native forests, where practicable; and
                        (B) to avoid the introduction of invasive nonnative
                    species.
        (b) Quality Criteria for Forest Carbon Allocations.--Not later than
    2 years after the date of enactment of this Act, the Administrator, in
    consultation with the Secretary of the Interior, the Secretary of
    State, and the Secretary of Agriculture, shall promulgate regulations
    establishing the requirements for eligibility to receive allowances
    under this section, including requirements that ensure that the
    emission reductions or sequestrations are real, permanent, additional,
    verifiable and enforceable, with reliable measuring and monitoring and
    appropriate accounting for leakage.

    SEC. 3805. INTERNATIONAL FOREST CARBON ACTIVITIES.

        (a) In General.--The Administrator, in consultation with the
    Secretary of State, shall identify and periodically update a list of
    countries that have--
                (1) demonstrated capacity to participate in international
            forest carbon activities, including--
                        (A) sufficient historical data on changes in
                    national forest carbon stocks;
                        (B) technical capacity to monitor and measure
                    forest carbon fluxes with an acceptable level of
                    uncertainty; and
                        (C) institutional capacity to reduce emissions from
                    deforestation and degradation;
                (2) capped greenhouse gas emissions or otherwise
            established a national emission reference scenario based on
            historical data; and
                (3) commenced an emission reduction program for the forest
            sector.
        (b) Additionality.--
                (1) Reduction in deforestation and forest degradation.--A
            verified reduction in greenhouse gas emissions from
            deforestation and forest degradation under a cap or from a
            nationwide emissions reference scenario described in subsection
            (a) shall be--
                        (A) eligible for distribution of emission
                    allowances under this section; and
                        (B) considered to satisfy the additionality
                    criterion.
                (2) Periodic review of national level reductions in
            deforestation and degradation.--The Administrator, in
            consultation with the Secretary of State, shall identify and
            periodically update a list of countries described in subsection
            (a) that have--
                        (A) achieved national-level reductions of
                    deforestation and degradation below a historical
                    reference scenario, taking into consideration the
                    average annual deforestation and degradation rates of
                    the country and of all countries during a period of at
                    least 5 years; and
                        (B) demonstrated those reductions using remote
                    sensing technology that meets international standards.
                (3) Other forest carbon activities.--A forest carbon
            activity, other than a reduction in deforestation or forest
            degradation, shall be eligible for distribution of emission
            allowances under this section, subject to the quality criteria
            for forest carbon activities identified in this Act or in
            regulations promulgated under this Act.
        (c) Recognition of Forest Carbon Activities.--With respect to
    countries other than countries described in subsection (a), the
    Administrator--
                (1) shall recognize forest carbon activities, subject to
            the quality criteria for forest carbon activities identified in
            this Act and regulations promulgated under this Act; and
                (2) is encouraged to identify other incentives, including
            economic and market-based incentives, to encourage developing
            countries with largely-intact native forests to protect those
            forests.

    SEC. 3806. REVIEWS AND DISCOUNT.

        (a) Reviews.--Not later than 3 years after the date of enactment of
    this Act, and 5 years thereafter, the Administrator shall conduct a
    review of the program under this subtitle.
        (b) Discount.--If, after the date that is 10 years after the date
    of enactment of this Act, the Administrator determines that foreign
    countries that, in the aggregate, generate greenhouse gas emissions
    accounting for more than 0.5 percent of global greenhouse gas emissions
    have not capped those emissions, established emissions reference
    scenarios based on historical data, or otherwise reduced total forest
    emissions, the Administrator may apply a discount to distributions of
    emission allowances to those countries under this section.

                       Subtitle I--Transition Assistance

    SEC. 3901. GENERAL ALLOCATION AND DISTRIBUTION.

        (a) General Allocation.--Not later than April 1, 2011, and annually
    thereafter through January 1, 2029, the Administrator shall allocate
    percentages of the Emission Allowance Account for the following
    calendar year as follows:

    ----------------------------------------------------------------------------------------------------------------
                                                        Fossil                    Owners and   Facilities
                                                      fuel-fired                 operators of     that        HFC
                                                       electric       Rural         energy     produce or  producers
                      Calendar Year                      power      electric      intensive      import       and
                                                      generating  cooperatives  manufacturing  petroleum-  importers
                                                      facilities                  facilities   based fuel
    ----------------------------------------------------------------------------------------------------------------
    2012                                                      19            1            10             2          2
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2013                                                      19            1            10             2          2
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2014                                                      19            1            10             2          2
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2015                                                      19            1            10             2          2
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2016                                                      19            1            10             2          2
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2017                                                      19            1            10             2          2
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2018                                                      18            1             9             2          2
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2019                                                      17            1             9             2          2
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2020                                                      16            1             8             2          2
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2021                                                      14            1             7             2          2
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2022                                                      13            1             7          1.75       1.75
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2023                                                      12            1             6          1.75       1.75
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2024                                                      11            1             5           1.5       1.25
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2025                                                      10            1             4             1          1
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2026                                                       8            1             3             1          1
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2027                                                       6            1             2           0.5        0.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2028                                                       4            1             1           0.5        0.5
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2029                                                       2            1           0.5          0.25       0.25
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    2030                                                       1            1          0.25          0.25       0.25
    ----------------------------------------------------------------------------------------------------------------

        (b) General Distribution.--Not later than 1 year after the date of
    enactment of this Act, the Administrator shall establish a system for
    distributing to entities identified under subsection (a) the emission
    allowances allocated under that subsection.
        (c) Facilities That Shut Down.--The system established pursuant to
    subsection (b) shall ensure, notwithstanding any other provision of
    this subtitle, that--
                (1) emission allowances are not distributed to an owner or
            operator for any facility that has been permanently shut down
            at the time of the distribution;
                (2) the owner or operator of any facility that permanently
            shuts down in a calendar year shall promptly return to the
            Administrator any emission allowances that the Administrator
            has distributed for that facility for any subsequent calendar
            years; and
                (3) that, if a facility receives a distribution of emission
            allowances under this subtitle for a calendar year and
            subsequently permanently shuts down during that calendar year,
            the owner or operator of the facility shall promptly return to
            the Administrator a number of emission allowances equal to the
            number that the Administrator determines is the portion that
            the owner or operator will no longer need to submit for that
            facility under section 1202(a).

    SEC. 3902. DISTRIBUTING EMISSION ALLOWANCES TO OWNERS AND OPERATORS OF
                  FOSSIL FUEL-FIRED ELECTRIC POWER GENERATING FACILITIES.

        (a) New Entrants.--
                (1) In general.--As part of the system established under
            section 3901(b), the Administrator shall, for each calendar
            year, set aside, from the quantity of emission allowances
            represented by the percentages described in the table contained
            in section 3901(a) for owners and operators of fossil fuel-
            fired electric power generating facilities, a quantity of
            emission allowances for distribution to owners and operators of
            new entrant fossil fuel-fired electric power generating
            facilities (including such new entrant facilities owned or
            operated by rural electric cooperatives in any State that is
            not a participant in the pilot program established under
            section 3903(a)).
                (2) Calculation of allowances.--The quantity of emission
            allowances distributed by the Administrator for a calendar year
            to a new entrant fossil fuel-fired electric power generating
            facility under paragraph (1) shall be equal to the product
            obtained by multiplying--
                        (A) the average greenhouse gas emission rate of all
                    fossil fuel-fired electric power generating facilities
                    that commenced operations during the 5 years preceding
                    the date of enactment of this Act; and
                        (B) the electricity generated by the facility
                    during the calendar year, adjusted downward on a pro
                    rata basis for each new facility in the event that
                    insufficient allowances are available under section
                    3901(a) for a calendar year.
        (b) Incumbents.--
                (1) In general.--As part of the system established under
            section 3901(b), the Administrator shall, for each calendar
            year, distribute to fossil fuel-fired electric power generating
            facilities (including such facilities owned or operated by
            rural electric cooperatives in any State that is not a
            participant in the pilot program established under section
            3903(a)) that were operating during the calendar year preceding
            the year in which this Act was enacted the emission allowances
            represented by the percentages described in the table contained
            in section 3901(a) for owners and operators of fossil fuel-
            fired electric power generating facilities that remain after
            the distribution of emission allowances under subsection (a).
                (2) Calculation of allowances.--The quantity of emission
            allowances distributed to a fossil fuel-fired electric power
            generating facility under paragraph (1) shall be equal to the
            product obtained by multiplying--
                        (A) the quantity of emission allowances available
                    for distribution under paragraph (1); and
                        (B) the quotient obtained by dividing--
                                (i) the annual average quantity of carbon
                            dioxide equivalents emitted by the facility
                            during the 3 calendar years preceding the date
                            of enactment of this Act; by
                                (ii) the annual average of the aggregate
                            quantity of carbon dioxide equivalents emitted
                            by all fossil fuel-fired electric power
                            generating facilities during those 3 calendar
                            years.

    SEC. 3903. DISTRIBUTING ADDITIONAL EMISSION ALLOWANCES TO RURAL
                  ELECTRIC COOPERATIVES.

        (a) Establishment of Pilot Program.--
                (1) In general.--As part of the system established under
            section 3901(b), the Administrator shall establish a pilot
            program for distributing to rural electric cooperatives in the
            States described in paragraph (2), for each of calendar years
            2012 through 2029, 15 percent of the total number of emission
            allowances allocated for the calendar year to rural electric
            cooperatives under section 3901(a).
                (2) Description of states.--The States referred to in
            subsection (a) are--
                        (A) 1 State east of the Mississippi River in which
                    13 rural electric cooperatives sold to consumers in
                    that State electricity in a quantity of 9,000,000 to
                    10,000,000 MWh, according to Energy Information
                    Administration data for calendar year 2005; and
                        (B) 1 State west of the Mississippi River in which
                    30 rural electric cooperatives sold to consumers in
                    that State electricity in a quantity of 3,000,000 to
                    4,000,000 MWh, according to Energy Information
                    Administration data for calendar year 2005.
        (b) Distribution to Other States.--As part of the system
    established under section 3901(b), the Administrator shall establish a
    system for distributing to rural electric cooperatives in all States
    other than the 2 States described in subsection (a)(2), for each of
    calendar years 2012 through 2029, 85 percent of the total number of
    emission allowances allocated for the calendar year to rural electric
    cooperatives under section 3901(a), in proportion to the sales of each
    rural electric cooperative, as reported by the Energy Information
    Administration.
        (c) Limitation.--No rural electric cooperative that receives
    emission allowances under subsection (a) shall receive any emission
    allowance under subsection (b), section 3902, or section 3402.
        (d) Report.--Not later than January 1, 2015, and every 3 years
    thereafter, the Administrator shall submit to Congress a report
    describing the success of the pilot program established under
    subsection (a), including a description of--
                (1) the benefits realized by ratepayers of the rural
            electric cooperatives that receive allowances under the pilot
            program; and
                (2) the use by those rural electric cooperatives of
            advanced, low greenhouse gas-emitting electric generation
            technologies, if any.

    SEC. 3904. DISTRIBUTING EMISSION ALLOWANCES TO OWNERS AND OPERATORS OF
                  ENERGY INTENSIVE MANUFACTURING FACILITIES.

        (a) Definitions.--In this section:
                (1) Currently operating facility.--The term ``currently
            operating facility'' means an eligible manufacturing facility
            that had significant operations during the calendar year
            preceding the calendar year for which emission allowances are
            being distributed under this section.
                (2) Eligible manufacturing facility.--
                        (A) In general.--The term ``eligible manufacturing
                    facility'' means a manufacturing facility located in
                    the United States that principally manufactures iron,
                    steel, aluminum, pulp, paper, cement, chemicals, or
                    such other products as the Administrator may determine,
                    by rule, are likely to be significantly disadvantaged
                    in competitive international markets as a result of
                    indirect costs of the program established under this
                    Act.
                        (B) Exclusion.--The term ``eligible manufacturing
                    facility'' does not include a facility eligible to
                    receive emission allowances under section 3902, 3903,
                    or 3905.
                (3) Indirect carbon dioxide emissions.--The term ``indirect
            carbon dioxide emissions'' means the product obtained by
            multiplying (as determined by the Administrator)--
                        (A) the quantity of electricity consumption at an
                    eligible manufacturing facility; and
                        (B) the rate of carbon dioxide emission per
                    kilowatt-hour output for the region in which the
                    manufacturer is located.
                (4) New entrant manufacturing facility.--The term ``new
            entrant manufacturing facility'', with respect to a calendar
            year, means an eligible manufacturing facility that began
            operation during or after the calendar year for which emission
            allowances are being distributed under this section.
        (b) Total Allocation for Currently Operating Facilities.--As part
    of the system established under section 3901(b), the Administrator
    shall, for each calendar year, distribute 96 percent of the total
    quantity of emission allowances available for allocation to carbon-
    intensive manufacturing under section 3901(a) to currently operating
    facilities.
        (c) Total Allocation for Currently Operating Facilities in Each
    Category of Manufacturing Facilities.--The quantity of emission
    allowances distributed by the Administrator for a calendar year to
    facilities in each category of currently operating facilities shall be
    equal to the product obtained by multiplying--
                (1) the total quantity of emission allowances available for
            allocation under subsection (b); and
                (2) the ratio that (during the calendar year preceding the
            calendar year for which emission allowances are being
            distributed under this section)--
                        (A) the sum of the direct and indirect carbon
                    dioxide emissions by currently operating facilities in
                    the category; bears to
                        (B) the sum of the direct and indirect carbon
                    dioxide emissions by all currently operating
                    facilities.
        (d) Individual Allocations to Currently Operating Facilities.--The
    quantity of emission allowances distributed by the Administrator for a
    calendar year to a currently operating facility shall be a quantity
    equal to the product obtained by multiplying--
                (1) the total quantity of emission allowances available for
            allocation to currently-operating facilities in the appropriate
            category, as determined under subsection (c); and
                (2) the ratio that (during the 3 calendar years preceding
            the year for which the allocation rule is promulgated for the
            allocation period)--
                        (A) the average number of production employees
                    employed at the facility; bears to
                        (B) the average number of production employees
                    employed at all existing eligible manufacturing
                    facilities in the appropriate category.
        (e) New Entrant Manufacturing Facilities.--
                (1) In general.--As part of the system established under
            section 3901(b), the Administrator shall, for each calendar
            year, distribute 4 percent of the total quantity of emission
            allowances available for allocation to carbon intensive
            manufacturing under section 3901(a) to new entrant
            manufacturing facilities.
                (2) Individual allocations.--The quantity of emission
            allowances distributed by the Administrator for a calendar year
            to a new entrant manufacturing facility shall be proportional
            to the product obtained by multiplying--
                        (A) the average number of production employees
                    employed at the new entrant manufacturing facility
                    during the prior calendar year; and
                        (B) the rate (in emission allowances per production
                    employee) at which emission allowances were allocated
                    to currently operating facilities in the appropriate
                    category for the calendar year, as determined under
                    subsection (d).

    SEC. 3905. DISTRIBUTING EMISSION ALLOWANCES TO OWNERS AND OPERATORS OF
                  FACILITIES AND OTHER ENTITIES THAT PRODUCE OR IMPORT
                  PETROLEUM-BASED FUEL.

        (a) In General.--As part of the system established under section
    3901(b), the Administrator shall, for each calendar year, distribute to
    facilities or entities that produce or import petroleum-based fuel the
    emission allowances represented by the percentages described in the
    table contained in section 3901(a) for owners and operators of
    facilities or entities that produce or import petroleum-based fuel.
        (b) Calculation of Allowances.--The quantity of emission allowances
    distributed to a facility or entity under subsection (a) shall be equal
    to the product obtained by multiplying--
                (1) the quantity of emission allowances available for
            distribution under subsection (a); and
                (2) the quotient obtained by dividing--
                        (A) the annual average of the aggregate quantity of
                    the petroleum-based products produced or imported by
                    that facility or entity during the 3 calendar years
                    preceding the distribution of allowances; by
                        (B) the annual average of the aggregate quantity of
                    petroleum-based products produced or imported by
                    covered facilities and entities that produced or
                    imported petroleum-based fuel during those preceding 3
                    calendar years.

    SEC. 3906. DISTRIBUTING EMISSION ALLOWANCES TO HYDROFLUOROCARBON
                  PRODUCERS AND IMPORTERS.

        (a) In General.--The emission allowances allocated to
    hydrofluorocarbon producers and hydrofluorocarbon importers under
    section 3901(a) shall be distributed to the individual
    hydrofluorocarbon producers and hydrofluorocarbon importers in
    accordance with section 10005.
        (b) Effect.--The distributions under subsection (a) shall not, in
    any way, limit or otherwise alter the prohibitions set forth in
    subsection 10007(b).

      Subtitle J--Reducing Methane Emissions From Landfills and Coal Mines

    SEC. 3907. ALLOCATION.

        Not later than April 1, 2011, and annually thereafter through 2049,
    the Administrator shall allocate 1 percent of the Emission Allowance
    Account for the following calendar year to a program for achieving
    real, verifiable, additional, permanent, and enforceable reductions in
    emissions of methane from landfills and coal mines.

    SEC. 3908. DISTRIBUTION.

        (a) In General.--Not later than 1 year after the date of enactment
    of this Act, the Administrator shall establish a program that includes
    a system for distributing to individual entities the emission
    allowances allocated under section 3907.
        (b) Requirement.--The Administrator shall distribute emission
    allowances under subsection (a) in a manner that maximizes the
    avoidance or reduction of greenhouse gas emissions.

                TITLE IV--AUCTIONS AND USES OF AUCTION PROCEEDS

                               Subtitle A--Funds

    SEC. 4101. ESTABLISHMENT.

        There are established in the Treasury of the United States the
    following funds:
                (1) The Energy Assistance Fund.
                (2) The Climate Change Worker Training Fund.
                (3) The Adaptation Fund.
                (4) The Climate Change and National Security Fund.
                (5) The Bureau of Land Management Emergency Firefighting
            Fund.
                (6) The Forest Service Emergency Firefighting Fund.
                (7) The Climate Security Act Management Fund.

    SEC. 4102. AMOUNTS IN FUNDS.

        Each Fund established by section 4101 shall consist of such amounts
    as are deposited into the respective Fund under subtitle C.

                 Subtitle B--Climate Change Credit Corporation

    SEC. 4201. ESTABLISHMENT.

        (a) In General.--There is established, as a nonprofit corporation
    without stock, a corporation to be known as the ``Climate Change Credit
    Corporation''.
        (b) Treatment.--The Corporation shall not be considered to be an
    agency or establishment of the Federal Government.

    SEC. 4202. APPLICABLE LAWS.

        The Corporation shall be subject to this title and, to the extent
    consistent with this title, the District of Columbia Business
    Corporation Act (D.C. Code section 29-301 et seq.).

    SEC. 4203. BOARD OF DIRECTORS.

        (a) In General.--The Corporation shall have a board of directors
    composed of 5 individuals who are citizens of the United States, of
    whom 1 shall be elected annually by the board to serve as Chairperson.
        (b) Political Affiliation.--Not more than 3 members of the board
    serving at any time may be affiliated with the same political party.
        (c) Appointment and Term.--A member of the board shall be appointed
    by the President, by and with the advice and consent of the Senate, for
    a term of 5 years.
        (d) Quorum.--Three members of the board shall constitute a quorum
    for a meeting of the board of directors.
        (e) Prohibitions.--
                (1) Conflicts of interest.--An individual employed by, or
            holding any official relationship (including any shareholder)
            with, any entity engaged in the generation, transmission,
            distribution, or sale of energy, an individual who has any
            pecuniary interest in the generation, transmission,
            distribution, or sale of energy, or an individual who has a
            pecuniary interest in the implementation of this Act, shall not
            be appointed to the Corporation under this subtitle.
                (2) No other employment.--A member of the Corporation shall
            not hold any other employment during the term of service of the
            member.
        (f) Vacancies.--
                (1) In general.--A vacancy on the Corporation--
                        (A) shall not affect the powers of the Corporation;
                    and
                        (B) shall be filled in the same manner as the
                    original appointment was made.
                (2) Service until new appointment.--A member of the
            Corporation the term of whom has expired or otherwise been
            terminated shall continue to serve until the date on which a
            replacement is appointed if the President determines that
            service to be appropriate.
        (g) Removal.--
                (1) In general.--A member may be removed from the
            Corporation on determination of the President for cause.
                (2) Notification.--Not later than 30 days before removing a
            member from the Corporation for cause under paragraph (1), the
            President shall provide to Congress an advance notification of
            the determination by the President to remove the member.

    SEC. 4204. REVIEW AND AUDIT BY COMPTROLLER GENERAL.

        Not later than January 1, 2013, and annually thereafter, the
    Comptroller General of the United States shall conduct a review and
    audit of each expenditure made pursuant to this title to determine the
    efficacy of the programs, expenditures, and projects funded under this
    title.

                              Subtitle C--Auctions

    SEC. 4301. EARLY AUCTIONS.

        (a) Initiation of Auctioning.--Not later than 1 year after the date
    of enactment of this Act, the Corporation shall begin auctioning the
    emission allowances allocated to the Corporation under section 3101.
        (b) Completion of Auctioning.--Not later than December 31, 2010,
    the Corporation shall complete auctioning of all allowances allocated
    to the Corporation under section 3101.
        (c) Proceeds From Early Auctioning.--The Corporation shall use to
    carry out programs established under subtitle D all proceeds of early
    auctioning conducted by the Corporation under this section.

    SEC. 4302. ANNUAL AUCTIONS.

        (a) In General.--Not later than 330 days before the beginning of a
    calendar year identified in the table contained in section 3102, the
    Corporation shall auction all of the allowances allocated to the
    Corporation for that year by the Administrator under section 3102.
        (b) Proceeds From Annual Auctioning.--
                (1) Bureau of land management emergency firefighting
            fund.--For each of calendar years 2012 through 2050, the
            Corporation shall deposit into the Bureau of Land Management
            Emergency Firefighting Fund established by section 4101(5)
            proceeds, from annual auctions that the Corporation conducts
            for the calendar year under this section, that are sufficient
            to ensure that the amount in the Fund equals $300,000,000.
                (2) Forest service emergency firefighting fund.--For each
            of calendar years 2012 through 2050, the Corporation shall
            deposit into the Forest Service Emergency Firefighting Fund
            established by section 4101(6) proceeds, from annual auctions
            that the Corporation conducts for the calendar year under this
            section, that are sufficient to ensure that the amount in the
            Fund equals $800,000,000.
                (3) Climate security act management fund.--
                        (A) In general.--For each of calendar years 2012
                    through 2050, the Corporation shall deposit into the
                    Climate Security Act Management Fund established by
                    section 4101(7) such percentage of the proceeds of the
                    annual auctions conducted by the Corporation for the
                    calendar year under this section as the Administrator
                    determines to be sufficient to efficiently and
                    effectively administer this Act.
                        (B) Distribution.--The Administrator may distribute
                    funds from the Climate Security Act Management Fund to
                    the Secretary of Agriculture, the Secretary of Labor,
                    and the Carbon Market Efficiency Board, as the
                    Administrator determines to be necessary to assist in
                    carrying out this Act.
                        (C) Use of funds.--The head of a Federal agency or
                    department may use funds from the Climate Security Act
                    Management Fund for the costs to the agency or
                    department of carrying out this Act, including the
                    costs of--
                                (i) promulgation of regulations;
                                (ii) development of policy guidance;
                                (iii) development and operation of
                            information systems;
                                (iv) certification of monitoring equipment;
                                (v) conducting facilities audits and
                            inspections;
                                (vi) monitoring and modeling;
                                (vii) quality assurance and verification
                            functions;
                                (viii) enforcement;
                                (ix) administration;
                                (x) outreach;
                                (xi) training;
                                (xii) field audits; and
                                (xiii) financial management.
                        (D) Treatment.--Amounts in the Climate Security Act
                    Management Fund--
                                (i) shall be used only to advance the
                            purposes described in section 3;
                                (ii) are subject to the availability of
                            appropriations; and
                                (iii) shall remain available until
                            expended.
                (4) Use of remaining proceeds.--
                        (A) In general.--For each of calendar years 2012
                    through 2050, the Corporation shall use the proceeds of
                    the annual auctions conducted by the Corporation for
                    the calendar year under this section in accordance with
                    this paragraph.
                        (B) Energy technology deployment.--For each of
                    calendar years 2012 through 2050, the Corporation shall
                    use to carry out the programs established under
                    subtitle D 52 percent of the proceeds of the annual
                    auctions conducted by the Corporation for the calendar
                    year under this section.
                        (C) Energy independence acceleration fund.--In any
                    of calendar years 2012 through 2050 during which there
                    exists in the Treasury of the United States an energy
                    transformation acceleration fund administered by the
                    Director of the Advanced Research Projects Agency
                    within the Department of Energy, of the proceeds of the
                    annual auctions conducted by the Corporation for the
                    calendar year under this section, the Corporation shall
                    deposit 2 percent of the proceeds into that fund.
                        (D) Energy consumers.--For each of calendar years
                    2012 through 2050, the Corporation shall deposit into
                    the Energy Assistance Fund established by section
                    4101(1) 18 percent of the proceeds of the annual
                    auctions conducted by the Corporation for the calendar
                    year under this section.
                        (E) Climate change worker training program.--For
                    each of calendar years 2012 through 2050, the
                    Corporation shall deposit into the Climate Change
                    Worker Training Fund established by section 4101(2) 5
                    percent of the proceeds of the annual auctions
                    conducted by the Corporation for the calendar year
                    under this section.
                        (F) Adaptation program for natural resources in
                    united states and territories.--For each of calendar
                    years 2012 through 2050, the Corporation shall deposit
                    into the Adaptation Fund established by section 4101(3)
                    18 percent of the proceeds of the annual auctions
                    conducted by the Corporation for the calendar year
                    under this section.
                        (G) Climate change and national security program.--
                    For each of calendar years 2012 through 2050, the
                    Corporation shall deposit into the Climate Change and
                    National Security Fund established by section 4101(4) 5
                    percent of the proceeds of the annual auctions
                    conducted by the Corporation for the calendar year
                    under this section.

                    Subtitle D--Energy Technology Deployment

    SEC. 4401. GENERAL ALLOCATIONS.

        For each calendar year, the Corporation shall use the amounts
    described in sections 4301(c) and 4302(b)(4)(B) to carry out the
    programs established under this subtitle, as follows:
                (1) 32 percent of the funds shall be used to carry out the
            zero- or low-carbon energy technologies program under section
            4402.
                (2) 25 percent shall be used to carry out the advanced coal
            and sequestration technologies program under section 4403.
                (3) 6 percent shall be used to carry out the fuel from
            cellulosic biomass program under section 4404.
                (4) 12 percent shall be used to carry out the advanced
            technology vehicles manufacturing incentive program under
            section 4405.
                (5) 25 percent shall be used to carry out the sustainable
            energy program under section 4406.

    SEC. 4402. ZERO- OR LOW-CARBON ENERGY TECHNOLOGIES DEPLOYMENT.

        (a) Definitions.--In this section:
                (1) Energy savings.--The term ``energy savings'' means
            megawatt-hours of electricity or million British thermal units
            of natural gas saved by a product, in comparison to projected
            energy consumption under an energy-efficiency standard
            applicable to the product.
                (2) Engineering integration costs.--The term ``engineering
            integration costs'' includes the costs of engineering tasks
            relating to--
                        (A) redesigning manufacturing processes to begin
                    producing qualifying components and zero- or low-carbon
                    generation technologies;
                        (B) designing new tooling and equipment for
                    production facilities that produce qualifying
                    components and zero- or low-carbon generation
                    technologies; and
                        (C) establishing or expanding manufacturing
                    operations for qualifying components and zero- or low-
                    carbon generation technologies.
                (3) High-efficiency consumer product.--The term ``high-
            efficiency consumer product'' means a covered product to which
            an energy conservation standard applies under section 325 of
            the Energy Policy and Conservation Act (42 U.S.C. 6295), if the
            energy efficiency of the product exceeds the energy efficiency
            required under the standard.
                (4) Qualifying component.--The term ``qualifying
            component'' means a component that the Secretary of Energy
            determines to be specially designed for zero- or low-carbon
            generation technology.
                (5) Zero- or low-carbon generation.--The term ``zero- or
            low-carbon generation'' means generation of electricity by an
            electric generation unit that--
                        (A) emits no carbon dioxide into the atmosphere, or
                    is fossil-fuel fired and emits into the atmosphere not
                    more than 250 pounds of carbon dioxide per megawatt-
                    hour (after adjustment for any carbon dioxide from the
                    unit that is geologically sequestered); and
                        (B) was placed into commercial service after the
                    date of enactment of this Act.
                (6) Zero- or low-carbon generation technology.--The term
            ``zero- or low-carbon generation technology'' means a
            technology used to create zero- or low-carbon generation.
        (b) Financial Incentives Program.--During each fiscal year
    beginning on or after October 1, 2008, the Corporation shall
    competitively award financial incentives under this subsection in the
    technology categories of--
                (1) the production of electricity from new zero- or low-
            carbon generation;
                (2) the manufacture of high-efficiency consumer products;
            and
                (3) facility establishment or conversion by manufacturers
            and component suppliers of zero- or low-carbon technology.
        (c) Requirements.--
                (1) In general.--The Corporation shall make awards under
            this section to domestic producers of new zero- or low-carbon
            generation, domestic manufacturers of high-efficiency consumer
            products, and domestic facilities and operations of
            manufacturers and component suppliers of zero- or low-carbon
            generation technology--
                        (A) in the case of producers of new zero- or low-
                    carbon generation, based on the bid of each producer in
                    terms of dollars per megawatt-hour of electricity
                    generated;
                        (B) in the case of manufacturers of qualifying
                    high-efficiency consumer products, based on the bid of
                    each manufacturer in terms of dollars per megawatt-hour
                    or million British thermal units saved; and
                        (C) in the case of qualifying manufacturers of
                    zero- or low-carbon generation technology, based on the
                    criteria noted in subsection (e).
                (2) Acceptance of bids.--
                        (A) In general.--In making awards under
                    subparagraphs (A) and (B) of paragraph (1), the
                    Corporation shall--
                                (i) solicit bids for reverse auction from
                            appropriate producers and manufacturers, as
                            determined by the Corporation; and
                                (ii) award financial incentives to the
                            producers and manufacturers that submit the
                            lowest bids that meet the requirements
                            established by the Corporation.
                        (B) Factors for conversion.--
                                (i) In general.--For the purpose of
                            assessing bids under subparagraph (A), the
                            Corporation shall specify a factor for
                            converting megawatt-hours of electricity and
                            million British thermal units of natural gas to
                            common units.
                                (ii) Requirement.--The conversion factor
                            shall be based on the relative greenhouse gas
                            emission benefits of electricity and natural
                            gas conservation.
        (d) Forms of Awards.--
                (1) Zero- and low-carbon generators.--An award for zero- or
            low-carbon generation under this subsection shall be in the
            form of a contract to provide a production payment for each
            year during the first 10 years of commercial service of the
            generation unit in an amount equal to the product obtained by
            multiplying--
                        (A) the amount bid by the producer of the zero- or
                    low-carbon generation; and
                        (B) the megawatt-hours estimated to be generated by
                    the zero- or low-carbon generation unit each year.
                (2) High-efficiency consumer products.--An award for a
            high-efficiency consumer product under this subsection shall be
            in the form of a lump sum payment in an amount equal to the
            product obtained by multiplying--
                        (A) the amount bid by the manufacturer of the high-
                    efficiency consumer product; and
                        (B) the energy savings during the projected useful
                    life of the high-efficiency consumer product, not to
                    exceed 10 years, as determined by the Corporation.
                (3) Manufacturing of zero- or low-carbon generation
            technology.--
                        (A) In general.--An award for facility
                    establishment or conversion costs for zero- or low-
                    carbon generation technology shall be in an amount
                    equal to not more than 30 percent of the cost of--
                                (i) establishing, reequipping, or expanding
                            a manufacturing facility to produce--
                                        (I) qualifying zero- or low-carbon
                                    generation technology; or
                                        (II) qualifying components;
                                (ii) engineering integration costs of zero-
                            or low-carbon generation technology and
                            qualifying components; and
                                (iii) property, machine tools, and other
                            equipment acquired or constructed primarily to
                            enable the recipient to test equipment
                            necessary for the construction or operation of
                            a zero- or low-carbon generation facility.
                        (B) Minimum amount.--The Corporation shall use not
                    less than \1/4\ of the amounts made available to carry
                    out this section to make awards to entities for the
                    manufacturing of zero- or low-carbon generation
                    technology.
        (e) Selection Criteria.--In making awards under this section to
    qualifying manufacturers of zero- or low-carbon generation technology
    and qualifying components, the Corporation shall select manufacturers
    that--
                (1) document the greatest use of domestically sourced parts
            and components;
                (2) return to productive service existing idle
            manufacturing capacity;
                (3) are located in States with the greatest availability of
            unemployed manufacturing workers;
                (4) compensate workers at a minimum amount equal to at
            least 100 percent of the State average manufacturing wage, plus
            health insurance benefits;
                (5) demonstrate a high probability of commercial success;
            and
                (6) achieve other criteria, as the Corporation determines
            to be appropriate.

    SEC. 4403. ADVANCED COAL AND SEQUESTRATION TECHNOLOGIES PROGRAM.

        (a) Advanced Coal Technologies.--
                (1) Definitions.--In this section:
                        (A) Advanced coal generation technology.--Except as
                    provided in paragraph (2), the term ``advanced coal
                    generation technology'' means an advanced coal-fueled
                    power plant technology that meets 1 of the following
                    performance standards for limiting carbon dioxide
                    emissions from an electric generation unit on an annual
                    average basis, as determined by the Corporation:
                                (i) For an electric generation unit that is
                            not a new entrant, an annual emissions rate of
                            not more than 1,200 pounds of carbon dioxide
                            per megawatt-hour of net electricity
                            generation, after subtracting the carbon
                            dioxide that is captured and sequestered.
                                (ii) For any project for which construction
                            of the unit commenced before July 1, 2018, an
                            annual emissions rate of not more than 800
                            pounds of carbon dioxide per megawatt-hour of
                            net electricity generation, after subtracting
                            the carbon dioxide that is captured and
                            sequestered.
                                (iii) For any project for which
                            construction of the unit commenced on or after
                            July 1, 2018, an annual emissions rate of not
                            more than 350 pounds of carbon dioxide per
                            megawatt-hour of net electricity generation,
                            after subtracting the carbon dioxide that is
                            captured and sequestered.
                        (B) Commenced.--The term ``commenced'', with
                    respect to construction, means that an owner or
                    operator has--
                                (i) obtained the necessary permits to carry
                            out a continuous program of construction; and
                                (ii) entered into a binding contractual
                            obligation, with substantial financial
                            penalties for cancellation, to undertake such a
                            program.
                        (C) Construction.--The term ``construction'', with
                    respect to a carbon capture and sequestration project,
                    means the fabrication, erection, or installation of
                    technology for the project.
                (2) Adjustment of performance standards.--
                        (A) In general.--The Corporation may adjust the
                    emissions performance standards for a carbon capture
                    and sequestration project under paragraph (1)(A) for an
                    electric generation unit that uses subbituminous coal,
                    lignite, or petroleum coke in significant amounts.
                        (B) Requirement.--If the Corporation adjusts a
                    standard under subparagraph (A), the adjusted
                    performance standard for the applicable project shall
                    prescribe an annual emissions rate that requires the
                    project to achieve an equivalent reduction from
                    uncontrolled carbon dioxide emissions levels from the
                    use of subbituminous coal, lignite, or petroleum coke,
                    as compared to the emissions the project would have
                    achieved if that unit had combusted only bituminous
                    coal during the particular calendar year.
                (3) Demonstration projects.--
                        (A) In general.--The Corporation shall use not less
                    than \1/4\ of the amounts made available to carry out
                    this section for each fiscal year to support
                    demonstration projects using advanced coal generation
                    technology, including retrofit technology that could be
                    deployed on existing coal generation facilities.
                        (B) Certain projects.--Of the amounts described in
                    subparagraph (A), the Corporation shall make available
                    up to 25 percent for projects that meet the carbon
                    dioxide emissions performance standard under clause (i)
                    of paragraph (1)(A).
                (4) Deployment incentives.--
                        (A) In general.--The Corporation shall use not less
                    than \1/4\ of the amounts made available to carry out
                    this section for each fiscal year to provide financial
                    incentives to facilitate the deployment of not more
                    than 20 gigawatts of advanced coal generation
                    technologies.
                        (B) Administration.--In providing incentives under
                    this paragraph, the Corporation shall--
                                (i) provide appropriate incentives for
                            regulated investor-owned utilities, municipal
                            utilities, electric cooperatives, and
                            independent power producers, as determined by
                            the Secretary of Energy; and
                                (ii) ensure that a range of the domestic
                            coal types is employed in the facilities that
                            receive incentives under this paragraph.
                        (C) Funding requirements.--
                                (i) Sequestration activities.--The
                            Corporation shall provide incentives only to
                            projects that meet 1 of the emission
                            performance standards for limiting carbon
                            dioxide under clause (ii) or (iii) of paragraph
                            (1)(A).
                                (ii) Projects using certain coals.--In
                            providing incentives under this paragraph, the
                            Corporation shall set aside not less than 25
                            percent of any amounts made available to carry
                            out this subsection for projects using coal
                            with an energy content of not more than 10,000
                            British thermal units per pound.
                (5) Storage agreement required.--The Corporation shall
            require a binding storage agreement for the carbon dioxide
            captured in a project under this subsection in a geological
            storage project permitted by the Administrator under
            regulations promulgated pursuant to section 1421(d) of the Safe
            Drinking Water Act (42 U.S.C. 300h(d)).
                (6) Distribution of funds.--
                        (A) Requirement.--The Corporation shall make awards
                    under this section in a manner that maximizes the
                    avoidance or reduction of greenhouse gas emissions.
                        (B) Incentives.--A project that receives an award
                    under this subsection may elect 1 of the following
                    financial incentives:
                                (i) A loan guarantee.
                                (ii) A cost-sharing grant to cover the
                            incremental cost of installing and operating
                            carbon capture and storage equipment (for which
                            utilization costs may be covered for the first
                            10 years of operation).
                                (iii) Production payments of not more than
                            1.5 cents per kilowatt-hour of electric output
                            during the first 10 years of commercial service
                            of the project.
                (7) Limitation.--A project may not receive an award under
            this subsection if the project receives an award under section
            4402.
        (b) Sequestration.--
                (1) In general.--The Corporation shall use not less than
            \1/2\ of the amounts made available to carry out this section
            for each fiscal year for large-scale geological carbon storage
            demonstration projects that store carbon dioxide captured from
            electric generation units using coal gasification or other
            advanced coal combustion processes, including units that
            receive assistance under subsection (a).
                (2) Project capital and operating costs.--
                        (A) In general.--The Corporation shall provide
                    assistance under this subsection to reimburse the
                    project owner for a percentage of the incremental
                    project capital and operating costs of the project that
                    are attributable to carbon capture and sequestration,
                    as the Secretary determines to be appropriate.
                        (B) Certain projects.--Of the assistance provided
                    under subparagraph (A), the Corporation shall make
                    available up to 25 percent for projects that meet the
                    carbon dioxide emissions performance standard under
                    subsection (a)(1)(A)(i).

    SEC. 4404. FUEL FROM CELLULOSIC BIOMASS.

        (a) In General.--The Corporation shall provide deployment
    incentives under this section to encourage a variety of projects to
    domestically produce transportation fuels from cellulosic biomass,
    relying on different feedstocks in different regions of the United
    States.
        (b) Project Eligibility.--Incentives under this section shall be
    provided on a competitive basis to projects that domestically produce
    fuels that--
                (1) meet United States fuel and emission specifications;
                (2) help diversify domestic transportation energy supplies;
            and
                (3) improve or maintain air, water, soil, and habitat
            quality, and protect scarce water supplies.
        (c) Incentives.--Incentives under this section may consist of--
                (1) loan guarantees for the construction of production
            facilities and supporting infrastructure; or
                (2) production payments through a reverse auction in
            accordance with subsection (d).
        (d) Reverse Auction.--
                (1) In general.--In providing incentives under this
            section, the Corporation shall--
                        (A) prescribe rules under which producers of fuel
                    from cellulosic biomass may bid for production payments
                    under subsection (c)(2); and
                        (B) solicit bids from producers of different
                    classes of transportation fuel, as the Corporation
                    determines to be appropriate.
                (2) Requirement.--The rules under section 4402 shall
            require that incentives shall be provided to the producers that
            submit the lowest bid (in terms of cents per gallon gasoline
            equivalent) for each class of transportation fuel from which
            the Corporation solicits a bid.

    SEC. 4405. ADVANCED TECHNOLOGY VEHICLES MANUFACTURING INCENTIVE
                  PROGRAM.

        (a) Definitions.--In this section:
                (1) Advanced technology vehicle.--The term ``advanced
            technology vehicle'' means an electric vehicle, a fuel cell-
            powered vehicle, a hybrid or plug-in hybrid electric vehicle,
            or an advanced diesel light duty motor vehicle, that meets--
                        (A) the Tier II Bin 5 emission standard established
                    in rules prescribed by the Administrator under section
                    202(i) of the Clean Air Act (42 U.S.C. 7521(i)), or a
                    lower-numbered Bin emission standard;
                        (B) any new emission standard for fine particulate
                    matter prescribed by the Administrator under that Act;
                    and
                        (C) standard of at least 125 percent of the average
                    base year combined fuel economy, calculated on an
                    energy-equivalent basis for vehicles other than
                    advanced diesel light-duty motor vehicles, for vehicles
                    of a substantially similar nature and footprint.
                (2) Combined fuel economy.--The term ``combined fuel
            economy'' means--
                        (A) the combined city-highway miles per gallon
                    values, as reported in accordance with section 32908 of
                    title 49, United States Code; and
                        (B) in the case of an electric drive vehicle with
                    the ability to recharge from an off-board source, the
                    reported mileage, as determined in a manner consistent
                    with the Society of Automotive Engineers recommended
                    practice for that configuration, or a similar practice
                    recommended by the Secretary of Energy, using a
                    petroleum equivalence factor for the off-board
                    electricity (as defined by the Secretary of Energy).
                (3) Engineering integration costs.--The term ``engineering
            integration costs'' includes the cost of engineering tasks
            performed in the United States relating to--
                        (A) incorporating qualifying components into the
                    design of advanced technology vehicles; and
                        (B) designing new tooling and equipment for
                    production facilities that produce in the United States
                    qualifying components or advanced technology vehicles.
                (4) Qualifying component.--The term ``qualifying
            component'' means a component that the Secretary of Energy
            determines to be--
                        (A) specially designed for advanced technology
                    vehicles;
                        (B) installed for the purpose of meeting the
                    performance requirements of advanced technology
                    vehicles as specified in subparagraphs (A), (B), and
                    (C) of paragraph (1); and
                        (C) manufactured in the United States.
        (b) Manufacturer Facility Conversion Awards.--The Corporation shall
    provide facility conversion funding awards under this subsection to
    automobile manufacturers and component suppliers to pay up to 30
    percent of the cost of--
                (1) reequipping or expanding an existing manufacturing
            facility to produce--
                        (A) qualifying advanced technology vehicles; or
                        (B) qualifying components; and
                (2) engineering integration of qualifying vehicles and
            qualifying components.
        (c) Period of Availability.--An award under subsection (b) shall
    apply to--
                (1) facilities and equipment placed in service after the
            date of enactment of this Act and before January 1, 2030; and
                (2) engineering integration costs incurred after the date
            of enactment of this Act.
        (d) Additional Limitations.--
                (1) Maximum amount.--The maximum amount of all awards under
            this section shall not exceed $40,000,000,000.
                (2) CAFE requirements.--The Corporation shall not make an
            award under this section to an automobile manufacturer or
            component supplier that, directly or through a parent,
            subsidiary, or affiliated entity, is not in compliance with
            each corporate average fuel economy standard under section
            32902 of title 49, United States Code, in effect on the date of
            the award.
        (e) Additional Requirements.--
                (1) Definition of recipient.--In this subsection, the term
            ``recipient'' means the automobile manufacturer or component
            supplier (including any parent, subsidiary, and affiliated
            entities) that receives an award under this section.
                (2) Certification.--To be eligible for an award under this
            section, an automobile manufacturer or component supplier
            (including any parent, subsidiary, and affiliated entities)
            shall certify to the Corporation that, for each of the 7
            calendar years following the receipt of the award, the
            manufacturer or supplier will maintain in the United States a
            number of full-time or full-time-equivalent employees--
                        (A) equal to 90 percent of the monthly average
                    number of full-time or full-time-equivalent employees
                    maintained by the manufacturer or supplier for the 12-
                    month period ending on the date of receipt of the
                    award;
                        (B) sufficient to ensure that the proportion that
                    the workforce of the manufacturer or supplier in the
                    United States bears to the global workforce of the
                    manufacturer or supplier is equal to or greater than
                    the average monthly proportion that the workforce of
                    the manufacturer or supplier in the United States bears
                    to the global workforce of the manufacturer or supplier
                    for the 12-month period ending on the date of receipt
                    of the award; or
                        (C) sufficient to ensure that any percentage
                    decrease in the hourly workforce of the manufacturer or
                    supplier in the United States is not greater than
                    aggregate of the percentage decrease in the market
                    share of the manufacturer or supplier in the United
                    States and the increase in the productivity of the
                    manufacturer or supplier, calculated during the period
                    beginning on the date of receipt of the award and
                    ending on the date of certification under this
                    subparagraph.
                (3) Recertification.--Not later than 1 year after the date
            of receipt of an award under this section, and annually
            thereafter, a manufacturer or supplier shall--
                        (A) recertify to the Corporation that, during the
                    preceding calendar year, the manufacturer or supplier
                    has achieved compliance with the requirement described
                    in paragraph (2); and
                        (B) provide to the Corporation sufficient data for
                    verification of the recertification.
                (4) Repayment.--A manufacturer or supplier that fails to
            make the recertification required by paragraph (3) shall pay to
            the Corporation an amount equal to the difference between--
                        (A) the amount of the original award to the
                    manufacturer or supplier; and
                        (B) the product obtained by multiplying--
                                (i) an amount equal to \1/7\ of that
                            original amount; and
                                (ii) the number of years during which the
                            manufacturer or supplier--
                                        (I) received an award under this
                                    section; and
                                        (II) made the certification
                                    required by paragraph (3).

    SEC. 4406. SUSTAINABLE ENERGY PROGRAM.

        (a) Definition of Sustainable Energy Technology.--In this section,
    the term ``sustainable energy technology'' means a technology to
    harness a renewable energy source (as defined in section 609(a) of the
    Public Utility Regulatory Policies Act of 1978 (7 U.S.C. 918c(a)),
    including in distributed energy systems.
        (b) Demonstration Projects.--The Corporation shall use not less
    than 25 percent of the amounts made available to carry out this section
    for each fiscal year to support demonstration projects in the United
    States using sustainable energy technology, including in distributed
    energy systems.
        (c) Deployment Incentives.--
                (1) In general.--The Corporation shall use not less than 25
            percent of the amounts made available to carry out this section
            for each fiscal year to provide Federal financial incentives to
            facilitate the deployment in the United States of sustainable
            energy technology, including in distributed energy systems.
                (2) Administration.--In providing incentives under this
            subsection, the Corporation shall provide appropriate
            incentives for regulated investor-owned utilities, municipal
            utilities, electric cooperatives, independent power producers,
            and consumers, as determined by the Secretary of Energy.
        (d) Distribution of Funds.--A project that receives an award under
    this subsection may elect 1 of the following Federal financial
    incentives:
                (1) A loan guarantee.
                (2) A cost-sharing grant to cover the incremental cost of
            installing and operating equipment (for which utilization costs
            may be covered for the first 10 years of operation).
                (3) Production payments of not more than 1.5 cents per
            kilowatt-hour of electric output during the first 10 years of
            commercial service of the project.
        (e) Limitation.--A project may not receive an award under this
    subsection if the project receives an award under section 4402.

                          Subtitle E--Energy Consumers

    SEC. 4501. PROPORTIONS OF FUNDING AVAILABILITY.

        All funds deposited into the Energy Assistance Fund established by
    section 4101(1) shall be made available, without further appropriation
    or fiscal year limitation, to the following programs in the following
    proportions:
                (1) 50 percent of the funds to the low-income home energy
            assistance program established under the Low Income Home Energy
            Assistance Act of 1981 (42 U.S.C. 8621 et seq.).
                (2) 25 percent of the funds to the Weatherization
            Assistance Program for Low-Income Persons established under
            part A of title IV of the Energy Conservation and Production
            Act (42 U.S.C. 6861 et seq.).
                (3) 25 percent of the funds to the rural energy assistance
            program described in section 4502.

    SEC. 4502. RURAL ENERGY ASSISTANCE PROGRAM.

        The Secretary of Energy shall carry out a program to use the funds
    made available under section 4501(3) to provide financial assistance to
    promote the availability of reasonably-priced distributed electricity
    in off-grid rural regions in which electricity prices exceed 150
    percent of the national average, as determined by the Secretary of
    Energy.

               Subtitle F--Climate Change Worker Training Program

    SEC. 4601. FUNDING.

        All funds deposited into the Climate Change Worker Training Fund
    established by section 4101(2) shall be made available, without further
    appropriation or fiscal year limitation, to carry out the programs
    established under this subtitle.

    SEC. 4602. PURPOSES.

        The purposes of this subtitle are--
                (1) to create a sustainable, comprehensive public program
            that provides quality training that is linked to jobs that are
            created through low-carbon energy, sustainable energy, and
            energy efficiency initiatives;
                (2) to satisfy industry demand for a skilled workforce,
            support economic growth, boost the global competitiveness of
            the United States in expanding low-carbon energy, sustainable
            energy, and energy efficiency industries, and provide economic
            self-sufficiency and family-sustaining jobs for United States
            workers, including low-wage workers, through quality training
            and placement in job opportunities in those industries; and
                (3) to provide funds for Federal and State industry-wide
            research, labor market information and labor exchange programs,
            and the development of Federal- and State-administered training
            programs.

    SEC. 4603. ESTABLISHMENT.

        Not later than 180 days after the date of enactment of this Act,
    the Secretary of Labor (referred to in this subtitle as the
    ``Secretary''), in consultation with the Administrator and the
    Secretary of Energy, shall establish a climate change worker training
    program that achieves the purposes of this subtitle.

    SEC. 4604. ACTIVITIES.

        (a) National Research Program.--Under the program established under
    section 4603, the Secretary, acting through the Bureau of Labor
    Statistics, shall provide assistance to support national research to
    develop labor market data and to track future workforce trends
    resulting from energy-related initiatives carried out under this
    section, including--
                (1) linking research and development in low-carbon energy,
            sustainable energy, and energy efficiency technology with the
            development of standards and curricula for current and future
            jobs;
                (2) the tracking and documentation of academic and
            occupational competencies and future skill needs with respect
            to low-carbon energy, sustainable energy, and energy efficiency
            technology;
                (3) tracking and documentation of occupational information
            and workforce training data with respect to low-carbon energy,
            sustainable energy, and energy efficiency technology;
                (4) assessing new employment and work practices, including
            career ladder and upgrade training and high-performance work
            systems; and
                (5) collaborating with State agencies, industry, organized
            labor, and community and nonprofit organizations to disseminate
            successful innovations for labor market services and worker
            training with respect to low-carbon energy, sustainable energy,
            and energy efficiency technology.
        (b) National Energy Training Partnership Grants.--
                (1) Grants.--
                        (A) In general.--Under the program established
                    under section 4603, the Secretary shall award national
                    energy training partnerships grants on a competitive
                    basis to eligible entities to enable the entities--
                                (i) to carry out national training that
                            leads to economic self-sufficiency; and
                                (ii) to develop a low-carbon energy,
                            sustainable energy, and energy efficiency
                            industries workforce.
                        (B) Diversity.--Grants shall be awarded under this
                    paragraph so as to ensure geographic diversity, with--
                                (i) at least 2 grants awarded to entities
                            located in each of the 4 Petroleum
                            Administration for Defense Districts with no
                            subdistricts; and
                                (ii) at least 1 grant awarded to an entity
                            located in each of the subdistricts of the
                            Petroleum Administration for Defense District
                            with subdistricts.
                (2) Eligibility.--To be eligible to receive a grant under
            paragraph (1), an entity shall be a nonprofit partnership
            that--
                        (A) includes the equal participation of industry,
                    including public or private employers, and labor
                    organizations, including joint labor-management
                    training programs, and may include community-based
                    organizations, educational institutions, small
                    businesses, cooperatives, State and local veterans
                    agencies, and veterans service organizations; and
                        (B) demonstrates--
                                (i) experience in implementing and
                            operating worker skills training and education
                            programs;
                                (ii) the ability to identify and involve in
                            training programs carried out using the grant,
                            target populations of workers that are or will
                            be engaged in activities relating to low-carbon
                            energy, sustainable energy, and energy
                            efficiency industries; and
                                (iii) the ability to help workers achieve
                            economic self-sufficiency.
                (3) Activities.--Activities to be carried out using a grant
            provided under this subsection may include--
                        (A) the provision of occupational skills training,
                    including curriculum development, on-the-job training,
                    and classroom training;
                        (B) the provision of safety and health training;
                        (C) the provision of basic skills, literacy,
                    general equivalency degree, English as a second
                    language, and job readiness training;
                        (D) individual referral and tuition assistance for
                    a community college training program;
                        (E) the provision of customized training in
                    conjunction with an existing registered apprenticeship
                    program or labor-management partnership;
                        (F) the provision of career ladder and upgrade
                    training; and
                        (G) the implementation of transitional jobs
                    strategies.
        (c) State Labor Market Research, Information, and Labor Exchange
    Research Program.--
                (1) In general.--Under the program established under
            section 4603, the Secretary shall award competitive grants to
            States to enable the States to administer labor market and
            labor exchange informational programs that include the
            implementation of the activities described in paragraph (2).
                (2) Activities.--A State shall use amounts awarded under
            this subsection to provide funding to the State agency that
            administers the Wagner-Peyser Act (29 U.S.C. 49 et seq.) and
            State unemployment compensation programs to carry out the
            following activities using State agency merit staff:
                        (A) The identification of job openings in the low-
                    carbon energy, sustainable energy, and energy
                    efficiency sector.
                        (B) The administration of skill and aptitude
                    testing and assessment for workers.
                        (C) The counseling, case management, and referral
                    of qualified job seekers to openings and training
                    programs, including low-carbon energy, sustainable
                    energy, and energy efficiency training programs.
        (d) State Energy Training Partnership Program.--
                (1) In general.--Under the program established under
            section 4603, the Secretary shall award competitive grants to
            States to enable the States to administer low-carbon energy,
            sustainable energy, and energy efficiency workforce development
            programs that include the implementation of the activities
            described in paragraph (2).
                (2) Activities.--
                        (A) In general.--A State shall use amounts awarded
                    under the subsection to award competitive grants to
                    eligible State energy sector partnerships to enable the
                    partnerships to coordinate with existing apprenticeship
                    and labor management training programs and implement
                    training programs that lead to the economic self-
                    sufficiency of trainees.
                        (B) Eligibility.--To be eligible to receive a grant
                    under this subsection, a State energy sector
                    partnership shall--
                                (i) consist of nonprofit organizations that
                            include equal participation from industry,
                            including public or private nonprofit
                            employers, and labor organizations, including
                            joint labor-management training programs, and
                            may include representatives from local
                            governments, worker investment agency one-stop
                            career centers, community based organizations,
                            community colleges, other post-secondary
                            institutions, small businesses, cooperatives,
                            State and local veterans agencies, and veterans
                            service organizations;
                                (ii) demonstrate experience in implementing
                            and operating worker skills training and
                            education programs; and
                                (iii) demonstrate the ability to identify
                            and involve in training programs, target
                            populations of workers that are or will be
                            engaged in activities relating to low-carbon
                            energy, sustainable energy, and energy
                            efficiency industries.
                        (C) Priority.--In awarding grants under this
                    subsection, the Secretary shall give priority to States
                    that demonstrate linkages of activities under the grant
                    with--
                                (i) meeting national energy policies
                            associated with low-carbon energy, sustainable
                            energy, and energy efficiency; and
                                (ii) meeting State energy policies
                            associated with low-carbon energy, sustainable
                            energy, and energy efficiency.
                        (D) Coordination.--An entity that receives a grant
                    under this subsection shall--
                                (i) coordinate activities carried out under
                            the grant with existing apprenticeship and
                            labor management training programs; and
                                (ii) implement training programs that lead
                            to the economic self-sufficiency of trainees,
                            including providing--
                                        (I) outreach and recruitment
                                    services, in coordination with the
                                    appropriate State agency;
                                        (II) occupational skills training,
                                    including curriculum development, on-
                                    the-job training, and classroom
                                    training;
                                        (III) safety and health training;
                                        (IV) basic skills, literacy,
                                    general equivalency degree, English as
                                    a second language, and job readiness
                                    training;
                                        (V) individual referral and tuition
                                    assistance for a community college
                                    training program;
                                        (VI) customized training in
                                    conjunction with an existing registered
                                    apprenticeship program or labor-
                                    management partnership;
                                        (VII) career ladder and upgrade
                                    training; and
                                        (VIII) services under transitional
                                    jobs strategies.

    SEC. 4605. WORKER PROTECTIONS AND NONDISCRIMINATION REQUIREMENTS.

        (a) Applicability of WIA.--Sections 181 and 188 of the Workforce
    Investment Act of 1998 (29 U.S.C. 2931, 2938) shall apply to all
    programs carried out using assistance under this subtitle.
        (b) Consultation With Labor Organizations.--If a labor organization
    represents a substantial number of workers that are engaged in similar
    work or training in an area that is the same as the area that is
    proposed to be funded under this subtitle, the labor organization shall
    be provided an opportunity to be consulted and to submit comments in
    regard to such a proposal.

    SEC. 4606. WORKFORCE TRAINING AND SAFETY.

        (a) University Programs.--In order to enhance the educational
    opportunities and safety of a future generation of scientists,
    engineers, health physicists, and energy workforce employees, 25
    percent of the funds deposited into the Climate Change Worker Training
    Fund shall be used for the University Programs within the Department of
    Energy, to help United States university and colleges stay at the
    forefront of science education and research and assist universities in
    the operation of advanced energy research facilities and in the
    performance of other educational activities.
        (b) Employee Organizations.--The Secretary shall provide technical
    assistance and funds for training directly to nonprofit employee
    organizations, voluntary emergency response organizations, and joint
    labor-management organizations that demonstrate experience in
    implementing and operating worker health and safety training and
    education programs.
        (c) Workforce Training.--
                (1) In general.--The Secretary of Labor, in cooperation
            with the Secretary of Energy, shall promulgate regulations--
                        (A) to implement a program to provide workforce
                    training to meet the high demand for workers skilled in
                    zero- and low-emitting carbon energy technologies and
                    provide for related safety issues;
                        (B) to implement a fully validated electrical craft
                    certification program, career and technology awareness
                    at the primary and secondary education level,
                    preapprenticeship career technical education for all
                    zero- and low-emitting carbon energy technologies
                    related industrial skilled crafts, community college
                    and skill center training for zero- and low-emitting
                    carbon energy technology technicians, development of
                    construction management personnel for zero- and low-
                    emitting carbon energy technology construction projects
                    and regional grants for integrated zero- and low-
                    emitting carbon energy technology workforce development
                    programs; and
                        (C) to ensure the safety of workers in such
                    careers.
                (2) Consultation.--In carrying out this subsection, the
            Secretary of Labor shall consult with relevant Federal
            agencies, representatives of the zero- and low-emitting carbon
            energy technologies industries, and organized labor, concerning
            skills and such safety measures that are needed in those
            industries.
        (d) Quantification.--For purposes of dispersing funds under this
    section, qualifying zero- and low-emitting carbon energy means any
    technology that has a rated capacity of at least 750 megawatts of
    power.

     Subtitle G--Adaptation Program for Natural Resources in United States
                                and Territories

    SEC. 4701. DEFINITIONS.

        In this subtitle:
                (1) Ecological process.--
                        (A) In general.--The term ``ecological process''
                    means a biological, chemical, or physical interaction
                    between the biotic and abiotic components of an
                    ecosystem.
                        (B) Inclusions.--The term ``ecological process''
                    includes--
                                (i) nutrient cycling;
                                (ii) pollination;
                                (iii) predator-prey relationships;
                                (iv) soil formation;
                                (v) gene flow;
                                (vi) larval dispersal and settlement;
                                (vii) hydrological cycling;
                                (viii) decomposition; and
                                (ix) disturbance regimes, such as fire and
                            flooding.
                (2) Fish and wildlife.--The term ``fish and wildlife''
            means--
                        (A) any species of wild fauna, including fish and
                    other aquatic species; and
                        (B) any fauna in a captive breeding program the
                    object of which is to reintroduce individuals of a
                    depleted indigenous species into previously occupied
                    range.
                (3) Habitat.--The term ``habitat'' means the physical,
            chemical, and biological properties that are used by wildlife
            (including aquatic and terrestrial plant communities) for
            growth, reproduction, and survival, food, water, cover, and
            space, on a tract of land, in a body of water, or in an area or
            region.
                (4) Indian tribe.--The term ``Indian tribe'' has the
            meaning given the term in section 4 of the Indian Self-
            Determination and Education Assistance Act (25 U.S.C. 450b).
                (5) Plant.--The term ``plant'' means any species of wild
            flora.
                (6) Secretary.--The term ``Secretary'' means the Secretary
            of the Interior.
                (7) State.--The term ``State'' means--
                        (A) a State;
                        (B) the District of Columbia;
                        (C) the Commonwealth of Puerto Rico; and
                        (D) any other territory or possession of the United
                    States.

    SEC. 4702. ADAPTATION FUND.

        (a) Availability of Amounts.--All amounts deposited in the
    Adaptation Fund established by section 4101(3) shall be made available,
    without further appropriation or fiscal year limitation, to carry out
    activities (including research and education activities) that assist
    fish and wildlife, fish and wildlife habitat, plants, and associated
    ecological processes in becoming more resilient, adapting to, and
    surviving the impacts of climate change and ocean acidification
    (referred to in this section as ``adaptation activities'') pursuant to
    this section.
        (b) Department of the Interior.--Of the amounts made available
    annually to carry out this subsection--
                (1) 35 percent shall be allocated to the Secretary, and
            subsequently made available to States through the Wildlife
            Conservation and Restoration Account established under section
            3(a)(2) of the Pittman-Robertson Wildlife Restoration Act (16
            U.S.C. 669b(a)(2)), to carry out adaptation activities in
            accordance with comprehensive State adaptation strategies, as
            described in subsection (j);
                (2) 19 percent shall be allocated to the Secretary for use
            in funding adaptation activities carried out--
                        (A) under endangered species, migratory bird, and
                    other fish and wildlife programs administered by the
                    United States Fish and Wildlife Service;
                        (B) on wildlife refuges and other public land under
                    the jurisdiction of the United States Fish and Wildlife
                    Service, the Bureau of Land Management, or the National
                    Park Service; or
                        (C) within Federal water managed by the Bureau of
                    Reclamation;
                (3) 5 percent shall be allocated to the Secretary for
            adaptation activities carried out under cooperative grant
            programs, including--
                        (A) the cooperative endangered species conservation
                    fund authorized under section 6(i) of the Endangered
                    Species Act of 1973 (16 U.S.C. 1535(i));
                        (B) programs under the North American Wetlands
                    Conservation Act (16 U.S.C. 4401 et seq.);
                        (C) the multinational species conservation fund
                    established under the heading ``multinational species
                    conservation fund'' of title I of the Department of the
                    Interior and Related Agencies Appropriations Act, 1999
                    (16 U.S.C. 4246);
                        (D) the Neotropical Migratory Bird Conservation
                    Fund established by section 9(a) of the Neotropical
                    Migratory Bird Conservation Act (16 U.S.C. 6108(a));
                        (E) the Coastal Program of the United States Fish
                    and Wildlife Service;
                        (F) the National Fish Habitat Action Plan;
                        (G) the Partners for Fish and Wildlife Program;
                        (H) the Landowner Incentive Program;
                        (I) the Wildlife Without Borders Program of the
                    United States Fish and Wildlife Service; and
                        (J) the Park Flight Migratory Bird Program of the
                    National Park Service; and
                (4) 1 percent shall be allocated to the Secretary and
            subsequently made available to Indian tribes to carry out
            adaptation activities through the tribal wildlife grants
            program of the United States Fish and Wildlife Service.
        (c) Land and Water Conservation Fund.--
                (1) Deposits.--
                        (A) In general.--Except as provided in paragraph
                    (2), of the amounts made available for each fiscal year
                    to carry out this subsection, 10 percent shall be
                    deposited into the Land and Water Conservation Fund
                    established under section 2 of the Land and Water
                    Conservation Fund Act of 1965 (16 U.S.C. 460l-5).
                        (B) Deposits to the Land and Water Conservation
                    Fund under this subsection shall--
                                (i) be supplemental to authorizations
                            provided under section 3 of the Land and Water
                            Conservation Fund Act of 1965 (16 U.S.C. 460l-
                            6); and
                                (ii) remain available for non-adaptation
                            needs.
                (2) Exception.--For any fiscal year in which a deposit into
            the Land and Water Conservation Fund under paragraph (1) would
            result in an amount greater than $900,000,000--
                        (A) $900,000,000 shall be deposited into the Land
                    and Water Conservation Fund; and
                        (B) the remaining funds shall be distributed on a
                    pro rata basis as otherwise provided in this section.
                (3) Allocations.--Of the amounts deposited under this
            subsection into the Land and Water Conservation Fund--
                        (A) \1/6\ shall be allocated to the Secretary and
                    made available to carry out section 6 of the Land and
                    Water Conservation Fund Act of 1965 (16 U.S.C. 460l-8)
                    to States, on a competitive basis--
                                (i) in accordance with comprehensive
                            wildlife conservation strategies and Indian
                            tribes, to carry out adaptation activities
                            through the acquisition of land and interests
                            in land;
                                (ii) notwithstanding section 5 of that Act
                            (16 U.S.C. 460l-7); and
                                (iii) in addition to grants provided
                            pursuant to--
                                        (I) annual appropriations Acts;
                                        (II) the Energy Policy Act of 2005
                                    (42 U.S.C. 15801 et seq.); or
                                        (III) any other authorization for
                                    nonadaptation needs;
                        (B) \1/3\ shall be allocated to the Secretary to
                    carry out adaptation activities through the acquisition
                    of lands and interests in land under section 7 of the
                    Land and Water Conservation Fund Act of 1965 (16 U.S.C.
                    460l-9);
                        (C) \1/6\ shall be allocated to the Secretary of
                    Agriculture and made available to the States to carry
                    out adaptation activities through the acquisition of
                    land and interests in land under section 7 of the
                    Forest Legacy Program under the Cooperative Forestry
                    Assistance Act of 1978 (16 U.S.C. 2103c); and
                        (D) \1/3\ shall be allocated to the Secretary of
                    Agriculture to carry out adaptation activities through
                    the acquisition of land and interests in land under
                    section 7 of the Land and Water Conservation Fund Act
                    of 1965 (16 U.S.C. 460l-9).
                (4) Expenditure of funds.--In allocating funds under
            subsection (c), the Secretary and the Secretary of Agriculture
            shall take into consideration factors including--
                        (A) the availability of non-Federal contributions
                    from State, local, or private sources;
                        (B) opportunities to protect wildlife corridors or
                    otherwise to link or consolidate fragmented habitats;
                        (C) opportunities to reduce the risk of
                    catastrophic wildfires, extreme flooding, or other
                    climate-related events that are harmful to fish and
                    wildlife and people;
                        (D) the potential for conservation of species or
                    habitat types at serious risk due to climate change,
                    ocean acidification, and other stressors; and
                        (E) the potential to provide enhanced access to
                    land and water for fishing, hunting, and other public
                    recreational uses.
        (d) Forest Service.--Of the amounts made available annually to
    carry out this section, 5 percent shall be allocated to the Secretary
    of Agriculture for use in funding adaptation activities carried out on
    national forests and national grasslands under the jurisdiction of the
    Forest Service, or pursuant to the cooperative Wings Across the
    Americas Program.
        (e) Environmental Protection Agency.--Of the amounts made available
    annually to carry out this section, 5 percent shall be allocated to the
    Administrator for use in adaptation activities restoring and
    protecting--
                (1) large-scale freshwater aquatic ecosystems, such as the
            Everglades, the Great Lakes, Flathead Lake, the Missouri River,
            the Mississippi River, the Colorado River, the Sacramento-San
            Joaquin Rivers, the Ohio River, the Columbia-Snake River
            System, the Apalachicola, Chattahoochee and Flint River System,
            the Connecticut River, and the Yellowstone River;
                (2) large-scale estuarine ecosystems, such as Chesapeake
            Bay, Long Island Sound, Puget Sound, the Mississippi River
            Delta , San Francisco Bay Delta, Narragansett Bay, and
            Albemarle-Pamlico Sound; and
                (3) freshwater and estuarine ecosystems, watersheds, and
            basins identified as priorities by the Administrator, working
            in cooperation with other Federal agencies, States, local
            governments, scientists, and other conservation partners.
        (f) Corps of Engineers.--Of the amounts made available annually to
    carry out this section, 10 percent shall be allocated to the Secretary
    of the Army for use by the Corps of Engineers to carry out adaptation
    activities restoring--
                (1) large-scale freshwater aquatic ecosystems, such as the
            ecosystems described in subsection (e)(1);
                (2) large-scale estuarine ecosystems, such as the
            ecosystems described in subsection (e)(2);
                (3) freshwater and estuarine ecosystems, watersheds, and
            basins identified as priorities by the Corps of Engineers,
            working in cooperation with other Federal agencies, States,
            local governments, scientists, and other conservation partners;
            and
                (4) habitats or ecosystems under programs such as the
            Estuary Restoration Act of 2000 (33 U.S.C. 2901 et seq.),
            project modifications for improvement of the environment, and
            aquatic restoration under section 206 of the Water Resources
            Development Act of 1996 (33 U.S.C. 2330).
        (g) Department of Commerce.--Of the amounts made available annually
    to carry out this section, 10 percent shall be allocated to the
    Secretary of Commerce for use in funding adaptation activities to
    protect, maintain, and restore coastal, estuarine, and marine
    resources, habitats, and ecosystems, including such activities carried
    out under--
                (1) the coastal and estuarine land conservation program;
                (2) the community-based restoration program;
                (3) the Coastal Zone Management Act of 1972 (16 U.S.C. 1451
            et seq.), subject to the condition that State coastal agencies
            shall incorporate, and the Secretary of Commerce shall approve,
            coastal zone management plan elements that are--
                        (A) consistent with the national adaptation
                    strategy under subsection (i), as part of a coastal
                    zone management program established under this Act; and
                        (B) specifically designed to strengthen the ability
                    of coastal, estuarine, and marine resources, habitats,
                    and ecosystems to adapt to and withstand the impacts
                    of--
                                (i) global warming; and
                                (ii) where practicable, ocean
                            acidification;
                (4) the Open Rivers Initiative;
                (5) the Magnuson Fishery Conservation and Management Act
            (16 U.S.C. 1801 et seq.);
                (6) the Marine Mammal Protection Act of 1972 (16 U.S.C.
            1361 et seq.);
                (7) the Endangered Species Act of 1973 (16 U.S.C. 1531 et
            seq.);
                (8) the Marine Protection, Research, and Sanctuaries Act of
            1972 (33 U.S.C. 1401 et seq.); and
                (9) the Coral Reef Conservation Act of 2000 (16 U.S.C. 6401
            et seq.).
        (h) Cost Sharing.--Notwithstanding any other provision of law, a
    State or Indian tribe that receives a grant under paragraph (1) or (4)
    of subsection (b) shall provide 10 percent of the costs of each
    activity carried out using amounts under the grant.
        (i) National Adaptation Strategy.--
                (1) In general.--Effective beginning on the date on which
            the President establishes the national strategy under paragraph
            (3), funds made available under paragraphs (2), (3), and (4) of
            subsection (b) and subsections (c) through (g) shall be used
            only for adaptation activities that are consistent with the
            national strategy.
                (2) Initial period.--Until the date on which the President
            establishes the national strategy under paragraph (3), funds
            made available under paragraphs (2), (3), and (4) of subsection
            (b) and subsections (c) through (g) shall be used only for
            adaptation activities that are consistent with a workplan
            established by the President.
                (3) National strategy.--
                        (A) In general.--Not later than 3 years after the
                    date of enactment of this Act, the President shall
                    develop and implement a national strategy for assisting
                    fish and wildlife, fish and wildlife habitat, plants,
                    and associated ecological processes in becoming more
                    resilient and adapting to the impacts of climate change
                    and ocean acidification.
                        (B) Administration.--In establishing and revising
                    the national strategy, the President shall--
                                (i) base the national strategy on the best
                            available science, as identified by the Science
                            Advisory Board established under subparagraph
                            (D);
                                (ii) develop the national strategy in
                            cooperation with State fish and wildlife
                            agencies, State coastal agencies, United States
                            territories, and Indian tribes;
                                (iii) coordinate with the Secretary of the
                            Interior, the Secretary of Commerce, the
                            Secretary of Agriculture, the Secretary of
                            Defense, the Administrator of the Environmental
                            Protection Agency, and other agencies as
                            appropriate;
                                (iv) consult with local governments,
                            conservation organizations, scientists, and
                            other interested stakeholders; and
                                (v) provide public notice and opportunity
                            for comment.
                        (C) Contents.--The President shall include in the
                    national strategy, at a minimum, prioritized goals and
                    measures and a schedule for implementation--
                                (i) to identify and monitor fish and
                            wildlife, fish and wildlife habitat, plants,
                            and associated ecological processes that are
                            particularly likely to be adversely affected by
                            climate change and ocean acidification and have
                            the greatest need for conservation;
                                (ii) to identify and monitor coastal,
                            estuarine, marine, terrestrial, and freshwater
                            habitats that are at the greatest risk of being
                            damaged by climate change and ocean
                            acidification;
                                (iii) to assist species in adapting to the
                            impacts of climate change and ocean
                            acidification;
                                (iv) to protect, acquire, maintain, and
                            restore fish and wildlife habitat to build
                            resilience to climate change and ocean
                            acidification;
                                (v) to provide habitat linkages and
                            corridors to facilitate fish, wildlife, and
                            plant movement in response to climate change
                            and ocean acidification;
                                (vi) to restore and protect ecological
                            processes that sustain fish, wildlife, and
                            plant populations that are vulnerable to
                            climate change and ocean acidification;
                                (vii) to protect, maintain, and restore
                            coastal, marine, and aquatic ecosystems so that
                            the ecosystems are more resilient and better
                            able to withstand the additional stresses
                            associated with climate change, including
                            relative sea level rise and ocean
                            acidification;
                                (viii) to protect ocean and coastal species
                            from the impact of climate change and ocean
                            acidification;
                                (ix) to incorporate adaptation strategies
                            and activities to address relative sea level
                            rise in coastal zone planning;
                                (x) to protect, maintain, and restore ocean
                            and coastal habitats to build healthy and
                            resilient ecosystems, including the purchase of
                            coastal and island land; and
                                (xi) to incorporate consideration of
                            climate change and ocean acidification, and to
                            integrate adaptation strategies and activities
                            for fish and wildlife, fish and wildlife
                            habitat, plants, and associated ecological
                            processes, in the planning and management of
                            Federal land and water administered by the
                            Federal agencies that receive funding under
                            this section.
                        (D) Science advisory board.--
                                (i) Establishment.--Not later than 180 days
                            after the date of enactment of this Act, the
                            Secretary shall establish and appoint the
                            members of a science advisory board, to be
                            comprised of not fewer than 10 and not more
                            than 20 members, who shall--
                                        (I) be recommended by the President
                                    of the National Academy of Sciences;
                                        (II) have expertise in fish,
                                    wildlife, plant, aquatic, and coastal
                                    and marine biology, ecology, climate
                                    change, ocean acidification, and other
                                    relevant scientific disciplines; and
                                        (III) represent a balanced
                                    membership between Federal, State, and
                                    local representatives, universities,
                                    and conservation organizations.
                                (ii) Duties.--The science advisory board
                            shall--
                                        (I) advise the President and
                                    relevant Federal agencies and
                                    departments on--
                                                (aa) the best available
                                            science regarding the impacts
                                            of climate change and ocean
                                            acidification on fish and
                                            wildlife, habitat, plants, and
                                            associated ecological
                                            processes; and
                                                (bb) scientific strategies
                                            and mechanisms for adaptation;
                                            and
                                        (II) identify and recommend
                                    priorities for ongoing research needs
                                    on those issues.
                                (iii) Collaboration.--The science advisory
                            board shall collaborate with other climate
                            change and ecosystem research entities in other
                            Federal agencies and departments.
                                (iv) Availability to public.--The advice
                            and recommendations of the science advisory
                            board shall be made available to the public.
                                (v) Nonapplicability of faca.--The Federal
                            Advisory Committee Act (5 U.S.C. App.) shall
                            not apply to the science advisory board.
                        (E) Coordination with other plans.--In developing
                    the national strategy, the President shall, to the
                    maximum extent practicable--
                                (i) take into consideration research and
                            information contained in--
                                        (I) State comprehensive wildlife
                                    conservation plans;
                                        (II) the North American waterfowl
                                    management plan;
                                        (III) the national fish habitat
                                    action plan;
                                        (IV) coastal zone management plans;
                                        (V) the reports of the Pew Oceans
                                    Commission and the United States
                                    Commission on Ocean Policy; and
                                        (VI) other relevant plans; and
                                (ii) coordinate and integrate the goals and
                            measures identified in the national strategy
                            with the goals and measures identified in those
                            plans.
                        (F) Revisions.--Not later than 5 years after the
                    date on which the strategy is developed, and not less
                    frequently than every 5 years thereafter, the President
                    shall review and update the national strategy using the
                    procedures described in this paragraph.
        (j) State Comprehensive Adaptation Strategies.--
                (1) In general.--Except as provided in paragraph (2), funds
            made available to States under this subtitle shall be used only
            for activities that are consistent with a State strategy that
            has been approved by, as appropriate--
                        (A) the Secretary of the Interior; or
                        (B) for any State with a coastal zone (within the
                    meaning of the Coastal Zone Management Act (16 U.S.C.
                    1451 et seq.)), by the Secretary of Commerce, subject
                    to the condition that approval by the Secretary of
                    Commerce shall be required only for those portions of
                    the strategy relating to activities affecting the
                    coastal zone.
                (2) Initial period.--
                        (A) In general.--Until the earlier of the date that
                    is 3 years after the date of enactment of this Act or
                    the date on which a State receives approval for the
                    State strategy, a State shall be eligible to receive
                    funding under subsection (b)(1) for adaptation
                    activities that are--
                                (i) consistent with the comprehensive
                            wildlife strategy of the State and, where
                            appropriate, other fish, wildlife and
                            conservation strategies; and
                                (ii) in accordance with a workplan
                            developed in coordination with, as
                            appropriate--
                                        (I) the Secretary of the Interior;
                                    or
                                        (II) for any State with a coastal
                                    zone (within the meaning of the Coastal
                                    Zone Management Act (16 U.S.C. 1451 et
                                    seq.)), by the Secretary of Commerce,
                                    subject to the condition that approval
                                    by the Secretary of Commerce shall be
                                    required only for those portions of the
                                    strategy relating to activities
                                    affecting the coastal zone.
                        (B) Pending approval.--During the period for which
                    approval by the applicable Secretary of a State
                    strategy described in paragraph (3) is pending, the
                    State may continue receiving funds under subsection
                    (b)(1) pursuant to the workplan described subparagraph
                    (A)(ii).
                (3) Requirements.--A State strategy shall--
                        (A) describe the impacts of climate change and
                    ocean acidification on the diversity and health of the
                    fish, wildlife and plant populations, habitats, and
                    associated ecological processes;
                        (B) describe and prioritize proposed conservation
                    actions to assist fish, wildlife, and plant populations
                    in adapting to those impacts;
                        (C) establish programs for monitoring the impacts
                    of climate change on fish, wildlife, and plant
                    populations, habitats, and associated ecological
                    processes;
                        (D) include strategies, specific conservation
                    actions, and a timeframe for implementing conservation
                    actions for fish, wildlife, and plant populations,
                    habitats, and associated ecological processes;
                        (E) establish methods for assessing the
                    effectiveness of conservation actions taken to assist
                    fish, wildlife, and plant populations, habitats, and
                    associated ecological processes in adapting to those
                    impacts and for updating those actions to respond
                    appropriately to new information or changing
                    conditions;
                        (F) be developed--
                                (i) with the participation of the State
                            fish and wildlife agency, the State agency
                            responsible for administration of Land and
                            Water Conservation Fund grants, the State
                            Forest Legacy program coordinator, and the
                            State coastal agency; and
                                (ii) in coordination with the Secretary of
                            the Interior and, where applicable, the
                            Secretary of Commerce;
                        (G) provide for solicitation and consideration of
                    public and independent scientific input;
                        (H) take into consideration research and
                    information contained in, and coordinate with and
                    integrate the goals and measures identified in, as
                    appropriate, other fish, wildlife, and habitat
                    conservation strategies, including--
                                (i) the national fish habitat action plan;
                                (ii) plans under the North American
                            Wetlands Conservation Act (16 U.S.C. 4401 et
                            seq.);
                                (iii) the Federal, State, and local
                            partnership known as ``Partners in Flight'';
                                (iv) federally approved coastal zone
                            management plans under the Coastal Zone
                            Management Act of 1972 (16 U.S.C. 1451 et
                            seq.);
                                (v) federally approved regional fishery
                            management plans and habitat conservation
                            activities under the Magnuson Fishery
                            Conservation and Management Act (16 U.S.C. 1801
                            et seq.);
                                (vi) the national coral reef action plan;
                                (vii) recovery plans for threatened species
                            and endangered species under section 4(f) of
                            the Endangered Species Act of 1973 (16 U.S.C.
                            1533(f));
                                (viii) habitat conservation plans under
                            section 10 of that Act (16 U.S.C. 1539);
                                (ix) other Federal and State plans for
                            imperiled species;
                                (x) the United States shorebird
                            conservation plan;
                                (xi) the North American waterbird
                            conservation plan; and
                                (xii) other State-based strategies that
                            comprehensively implement adaptation activities
                            to remediate the effects of climate change and
                            ocean acidification on fish, wildlife, and
                            habitats; and
                        (I) be incorporated into a revision of the
                    comprehensive wildlife conservation strategy of a
                    State--
                                (i) that has been submitted to the United
                            States Fish and Wildlife Service; and
                                (ii)(I) that has been approved by the
                            Service; or
                                (II) on which a decision on approval is
                            pending.
                (4) Updating.--Each State strategy described in paragraph
            (3) shall be updated at least every 5 years.

       Subtitle H--International Climate Change Adaptation and National
                                Security Program

    SEC. 4801. FINDINGS.

        Congress finds that--
                (1) global climate change represents a potentially
            significant threat multiplier for instability around the world
            as changing precipitation patterns may exacerbate competition
            and conflict over agricultural, vegetative, and water resources
            and displace people, thus increasing hunger and poverty and
            causing increased pressure on least developed countries;
                (2) the strategic, social, political, and economic
            consequences of global climate change could have
            disproportionate impacts on least developed countries, which
            have fewer resources and thus, often fewer emissions;
                (3) the strategic, social, political, and economic
            consequences of global climate change are likely to have a
            greater adverse effect on less developed countries;
                (4) the consequences of global climate change could pose a
            danger to the security interest and economic interest of the
            United States; and
                (5) it is in the national security interest of the United
            States to recognize, plan for, and mitigate the international
            strategic, social, political, and economic effects of a
            changing climate.

    SEC. 4802. PURPOSES.

        The purposes of this subtitle are--
                (1) to protect the national security of the United States
            where such interest can be advanced by minimizing, averting, or
            increasing resilience to potentially destabilizing climate
            change impacts;
                (2) to support the development of national and regional
            climate change adaptation plans in least developed countries;
                (3) to support the deployment of technologies that would
            help least developed countries reduce their greenhouse gas
            emissions and respond to destabilizing impacts of climate
            change;
                (4) to provide assistance to least-developed countries and
            small island developing states with national or regional
            climate change adaptation plans in the planning, financing, and
            execution of adaptation projects;
                (5) to support investments and capital to reduce
            vulnerability related to climate change and its impacts,
            including but not limited to drought, famine, floods, sea level
            rise, shifts in agricultural zones or seasons, shifts in range
            that affect economic livelihoods, and refugees and internally
            displaced persons;
                (6) to support climate change adaptation research in or for
            least developed countries; and
                (7) to encourage the identification and adoption of
            appropriate low-carbon and efficient energy technologies in
            least-developed countries.

    SEC. 4803. ESTABLISHMENT.

        (a) Establishment of Program.--The Secretary of State, working with
    the Administrator of the U.S. Agency for International Development
    (referred to in this subtitle as the ``Agency'') and the Administrator,
    shall establish an International Climate Change Adaptation and National
    Security Program within the Agency.
        (b) Responsibilities of Program.--The Program shall--
                (1) submit annual reports to the President, the Committees
            on Environment and Public Works and Foreign Relations of the
            Senate, and the Committees on Energy and Commerce and Foreign
            Relations of the House of Representatives, and any other
            relevant committees on national security, the economy and
            foreign policy, that describe--
                        (A) the extent to which other countries are
                    committing to reducing greenhouse gas emissions through
                    mandatory programs;
                        (B) the extent to which global climate change,
                    through its potential negative impacts on sensitive
                    populations and natural resources in least developed
                    countries, may threaten, cause, or exacerbate political
                    instability or international conflict in those regions;
                    and
                        (C) the ramifications of any potentially
                    destabilizing impacts climate change may have on the
                    economic and national security of the United States,
                    including--
                                (i) the creation of refugees; and
                                (ii) international or internal armed
                            conflicts over water, food, land, or other
                            resources;
                (2) include in each annual report submitted under paragraph
            (1) a description of how funds made available under section
            4804 were spent to enhance the national security of the United
            States and assist in avoiding the politically destabilizing
            impacts of climate change in volatile regions of the world,
            particularly least developed countries; and
                (3) identify and recommend the countries in which
            assistance can have the greatest and most sustainable benefit
            to reducing vulnerability to climate change, primarily in the
            form of deploying adaptation and greenhouse gas reduction
            technologies.

    SEC. 4804. FUNDING.

        (a) Carrying Out Recommendations.--All funds deposited into the
    Climate Change and National Security Fund established by section
    4101(4) shall be made available, without further appropriation or
    fiscal year limitation, to carry out the program established under this
    subtitle.
        (b) Distribution of Funds.--The Administrator of the Agency shall
    distribute to the International Climate Change Adaptation and National
    Security Program the funds for the purposes described in section 4802.
        (c) Oversight.--The Administrator of the Agency shall oversee the
    expenditures by the Program.
        (d) Limitations.--Not more than 10 percent of amounts made
    available to carry out this subtitle shall be spent in any single
    country in any year.

                  Subtitle I--Emergency Firefighting Programs

    SEC. 4901. FINDINGS.

        Congress finds that--
                (1) since 1980, wildfires in the United States have burned
            almost twice as many acres per year on average than the average
            burned acreage during the period beginning on January 1, 1920,
            and ending on December 31, 1979;
                (2) the wildfire season in the western United States has
            increased by an average of 78 days during the 30-year period
            preceding the date of enactment of this Act;
                (3) researchers predict that the area subject to wildfire
            damage will increase during the 21st century by up to 118
            percent as a result of climate change;
                (4) of the annual budget of the Forest Service, the Forest
            Service used for wildfire suppression activities--
                        (A) 13 percent in 1991; and
                        (B) 45 percent in 2007; and
                (5) 1 percent of the largest escaped fires--
                        (A) burn 95 percent of all burned acres; and
                        (B) consume 85 percent of all wildfire fighting
                    costs.

    SEC. 4902. BUREAU OF LAND MANAGEMENT EMERGENCY FIREFIGHTING PROGRAM.

        (a) Use of Funds.--The amounts deposited into the Bureau of Land
    Management Emergency Firefighting Fund established by section 4101(5)
    shall be made available, without further appropriation or fiscal year
    limitation, to pay for wildland fire suppression activities the costs
    of which are in excess of amounts annually appropriated to the
    Secretary of the Interior for normal, nonemergency wildland fire
    suppression activities.
        (b) Accounting and Reporting.--
                (1) In general.--Not later than 3 years after the date of
            enactment of this Act, the Secretary of the Interior shall
            establish an accounting and reporting system, in accordance and
            compatible with National Fire Plan reporting procedures, for
            the activities carried out under this section.
                (2) Requirement.--The system established under paragraph
            (1) shall require that the Secretary of the Interior shall
            submit to the Committee on Natural Resources of the House of
            Representatives and the Committee on Energy and Natural
            Resources of the Senate--
                        (A) a monthly report describing each expenditure
                    made from the Bureau of Land Management Emergency
                    Firefighting Fund during the preceding month; and
                        (B) a report at the end of each fiscal year
                    describing the expenditures made from the Bureau of
                    Land Management Emergency Firefighting Fund during the
                    preceding fiscal year.

    SEC. 4903. FOREST SERVICE EMERGENCY FIREFIGHTING PROGRAM.

        (a) Use of Funds.--The amounts deposited into the Forest Service
    Emergency Firefighting Fund established by section 4101(6) shall be
    made available, without further appropriation or fiscal year
    limitation, to pay for wildland fire suppression activities the costs
    of which are in excess of amounts annually appropriated to the
    Secretary of Agriculture for normal, nonemergency wildland fire
    suppression activities.
        (b) Accounting and Reporting.--
                (1) In general.--Not later than 3 years after the date of
            enactment of this Act, the Secretary of Agriculture shall
            establish an accounting and reporting system, in accordance and
            compatible with National Fire Plan reporting procedures, for
            the activities carried out under this section.
                (2) Requirement.--The system established under paragraph
            (1) shall require that the Secretary of Agriculture shall
            submit to the Committee on Natural Resources of the House of
            Representatives and the Committee on Energy and Natural
            Resources of the Senate--
                        (A) a monthly report describing each expenditure
                    made from the Forest Service Emergency Firefighting
                    Fund during the preceding month; and
                        (B) a report at the end of each fiscal year
                    describing the expenditures made from the Forest
                    Service Emergency Firefighting Fund during the
                    preceding fiscal year.

                           TITLE V--ENERGY EFFICIENCY

                        Subtitle A--Appliance Efficiency

    SEC. 5101. RESIDENTIAL BOILERS.

        Section 325(f) of the Energy Policy and Conservation Act (42 U.S.C.
    6925(f)) is amended--
                (1) in the subsection heading, by inserting ``and Boilers''
            after ``Furnaces'';
                (2) in paragraph (1), by striking ``except that'' and all
            that follows through subparagraph (A) and inserting ``except
            that'';
                (3) in subparagraph (B)--
                        (A) by striking ``(B) the Secretary'' and inserting
                    ``the Secretary''; and
                        (B) by redesignating clauses (i) through (iii) as
                    subparagraphs (A) through (C), respectively, and
                    indenting appropriately;
                (4) by redesignating paragraph (3) as paragraph (4); and
                (5) by inserting after paragraph (2) the following:
                ``(3) Boilers.--
                        ``(A) In general.--Subject to subparagraphs (B) and
                    (C), boilers manufactured on or after September 1,
                    2012, shall meet the following requirements:

    ------------------------------------------------------------------------
                                      Minimum
                                    Annual Fuel
      ``Boiler Type Requirements    Utilization             Design
                                     Efficiency
    ------------------------------------------------------------------------
    Gas hot water.................   82 percent  No constant burning pilot,
                                                  automatic means for
                                                  adjusting water
                                                  temperature
    Gas steam.....................   80 percent  No constant burning pilot
    Oil hot water.................   84 percent  Automatic means for
                                                  adjusting temperature
    Oil steam.....................   82 percent  None
    Electric hot water............         None  Automatic means for
                                                  adjusting temperature
    Electric steam................         None  None
    ------------------------------------------------------------------------

                        ``(B) Automatic means for adjusting water
                    temperature.--
                                ``(i) In general.--The manufacturer shall
                            equip each gas, oil, and electric hot water
                            boiler (other than a boiler equipped with
                            tankless domestic water heating coils) with an
                            automatic means for adjusting the temperature
                            of the water supplied by the boiler to ensure
                            that an incremental change in inferred heat
                            load produces a corresponding incremental
                            change in the temperature of water supplied.
                                ``(ii) Certain boilers.--For a boiler that
                            fires at 1 input rate, the requirements of this
                            subparagraph may be satisfied by providing an
                            automatic means that allows the burner or
                            heating element to fire only when the means has
                            determined that the inferred heat load cannot
                            be met by the residual heat of the water in the
                            system.
                                ``(iii) No inferred heat load.--When there
                            is no inferred heat load with respect to a hot
                            water boiler, the automatic means described in
                            clauses (i) and (ii) shall limit the
                            temperature of the water in the boiler to not
                            more than 140 degrees Fahrenheit.
                                ``(iv) Operation.--A boiler described in
                            clause (i) or (ii) shall be operable only when
                            the automatic means described in clauses (i),
                            (ii), and (iii) is installed.
                        ``(C) Exception.--A boiler that is manufactured to
                    operate without any need for electricity, any electric
                    connection, any electric gauges, electric pumps,
                    electric wires, or electric devices of any sort, shall
                    not be required to meet the requirements of this
                    subsection.''.

    SEC. 5102. REGIONAL VARIATIONS IN HEATING OR COOLING STANDARDS.

        (a) In General.--Section 327 of the Energy Policy and Conservation
    Act (42 U.S.C. 6297) is amended--
                (1) by redesignating subsections (e), (f), and (g) as
            subsections (f), (g), and (h), respectively; and
                (2) by inserting after subsection (d) the following:
        ``(e) Regional Standards for Space Heating and Air Conditioning
    Products.--
                ``(1) Standards.--
                        ``(A) In general.--The Secretary may establish
                    regional standards for space heating and air
                    conditioning products, other than window-unit air-
                    conditioners and portable space heaters.
                        ``(B) National minimum and regional standards.--For
                    each space heating and air conditioning product, the
                    Secretary may establish--
                                ``(i) a national minimum standard; and
                                ``(ii) 2 more stringent regional standards
                            for regions determined to have significantly
                            differing climatic conditions.
                        ``(C) Maximum savings.--Any standards established
                    for a region under subparagraph (B)(ii) shall achieve
                    the maximum level of energy savings that are
                    technically feasible and economically justified within
                    that region.
                        ``(D) Economic justifiability study.--
                                ``(i) In general.--As a preliminary step in
                            determining the economic justifiability of
                            establishing a regional standard under
                            subparagraph (B)(ii), the Secretary shall
                            conduct a study involving stakeholders,
                            including--
                                        ``(I) a representative from the
                                    National Institute of Standards and
                                    Technology;
                                        ``(II) representatives of
                                    nongovernmental advocacy organizations;
                                        ``(III) representatives of product
                                    manufacturers, distributors, and
                                    installers;
                                        ``(IV) representatives of the gas
                                    and electric utility industries; and
                                        ``(V) such other individuals as the
                                    Secretary may designate.
                                ``(ii) Requirements.--The study under this
                            subparagraph--
                                        ``(I) shall determine the potential
                                    benefits and consequences of
                                    prescribing regional standards for
                                    heating and cooling products; and
                                        ``(II) may, if favorable to the
                                    standards, constitute the evidence of
                                    economic justifiability required under
                                    this Act.
                        ``(E) Regional boundaries.--Regional boundaries
                    used in establishing regional standards under
                    subparagraph (B)(ii) shall--
                                ``(i) conform to State borders; and
                                ``(ii) include only contiguous States
                            (other than Alaska and Hawaii), except that on
                            the request of a State, the Secretary may
                            divide the State to include a part of the State
                            in each of 2 regions.
                ``(2) Noncomplying products.--If the Secretary establishes
            standards for a region, it shall be unlawful under section 332
            to offer for sale at retail, sell at retail, or install within
            the region products that do not comply with the applicable
            standards.
                ``(3) Distribution in commerce.--
                        ``(A) In general.--Except as provided in
                    subparagraph (B), no product manufactured in a manner
                    that complies with a regional standard established
                    under paragraph (1) shall be distributed in commerce
                    without a prominent label affixed to the product that
                    includes--
                                ``(i) at the top of the label, in print of
                            not less than 14-point type, the following
                            statement: `It is a violation of Federal law
                            for this product to be installed in any State
                            outside the region shaded on the map printed on
                            this label.';
                                ``(ii) below the notice described in clause
                            (i), an image of a map of the United States
                            with clearly defined State boundaries and
                            names, and with all States in which the product
                            meets or exceeds the standard established
                            pursuant to paragraph (1) shaded in a color or
                            a manner as to be easily visible without
                            obscuring the State boundaries and names; and
                                ``(iii) below the image of the map required
                            under clause (ii), the following statement: `It
                            is a violation of Federal law for this label to
                            be removed, except by the owner and legal
                            resident of any single-family home in which
                            this product is installed.'.
                        ``(B) Energy-efficiency rating.--A product
                    manufactured that meets or exceeds all regional
                    standards established under this paragraph shall bear a
                    prominent label affixed to the product that includes at
                    the top of the label, in print of not less than 14-
                    point type, the following statement: `This product has
                    achieved an energy-efficiency rating under Federal law
                    allowing its installation in any State.'.
                ``(4) Recordkeeping.--A manufacturer of space heating or
            air conditioning equipment subject to regional standards
            established under this subsection shall--
                        ``(A) obtain and retain records on the intended
                    installation locations of the equipment sold; and
                        ``(B) make such records available to the Secretary
                    on request.''.
        (b) Conforming Amendments.--Section 327 of the Energy Policy and
    Conservation Act (42 U.S.C. 6297) is amended--
                (1) in subsection (b)--
                        (A) in paragraph (2), by striking ``subsection
                    (e)'' and inserting ``subsection (f)''; and
                        (B) in paragraph (3)--
                                (i) by striking ``subsection (f)(1)'' and
                            inserting ``subsection (g)(1)''; and
                                (ii) by striking ``subsection (f)(2)'' and
                            inserting ``subsection (g)(2)''; and
                (2) in subsection (c)(3), by striking ``subsection (f)(3)''
            and inserting ``subsection (g)(3)''.

                        Subtitle B--Building Efficiency

    SEC. 5201. UPDATING STATE BUILDING ENERGY EFFICIENCY CODES.

        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) Updates.--
                ``(1) In general.--The Secretary shall support updating the
            national model building energy codes and standards not later
            than 3 years after the date of enactment of the Lieberman-
            Warner Climate Security Act of 2007, and not less frequently
            every 3 years thereafter, to achieve overall energy savings, as
            compared to the IECC (2006) for residential buildings and
            ASHRAE Standard 90.1 (2004) for commercial buildings, of at
            least--
                        ``(A) 30 percent, with respect to each edition of a
                    model code or standard published during the period
                    beginning on January 1, 2010, and ending on December
                    31, 2019;
                        ``(B) 50 percent, with respect to each edition of a
                    model code or standard published on or after January 1,
                    2020; and
                        ``(C) targets for intermediate and subsequent
                    years, to be established by the Secretary not less than
                    3 years before the beginning on each target year, in
                    coordination with IECC and ASHRAE Standard 90.1 cycles,
                    at the maximum level of energy efficiency that is
                    technologically feasible and lifecycle cost-effective.
                ``(2) Revisions to iecc and ashrae.--
                        ``(A) In general.--If the IECC or ASHRAE Standard
                    90.1 regarding building energy use is revised, not
                    later than 1 year after the date of the revision, the
                    Secretary shall determine whether the revision will--
                                ``(i) improve energy efficiency in
                            buildings; and
                                ``(ii) meet the energy savings goals
                            described in paragraph (1).
                        ``(B) Modifications.--
                                ``(i) In general.--If the Secretary makes a
                            determination under subparagraph (A)(ii) that a
                            code or standard does not meet the energy
                            savings goals established under paragraph (1)
                            or if a national model code or standard is not
                            updated for more than 3 years, not later than 1
                            year after the determination or the expiration
                            of the 3-year period, the Secretary shall
                            establish a modified code or standard that
                            meets the energy savings goals.
                                ``(ii) Requirements.--
                                        ``(I) Energy savings.--A
                                    modification to a code or standard
                                    under clause (i) shall--
                                                ``(aa) achieve the maximum
                                            level of energy savings that is
                                            technically feasible and
                                            lifecycle cost-effective;
                                                ``(bb) be achieved through
                                            an amendment or supplement to
                                            the most recent revision of the
                                            IECC or ASHRAE Standard 90.1
                                            and taking into consideration
                                            other appropriate model codes
                                            and standards; and
                                                ``(cc) incorporate
                                            available appliances,
                                            technologies, and construction
                                            practices.
                                        ``(II) Treatment as baseline.--A
                                    modification to a code or standard
                                    under clause (i) shall serve as the
                                    baseline for the next applicable
                                    determination of the Secretary under
                                    subparagraph (A)(i).
                        ``(C) Public participation.--The Secretary shall--
                                ``(i) publish in the Federal Register a
                            notice relating to each goal, determination,
                            and modification under this paragraph; and
                                ``(ii) provide an opportunity for public
                            comment regarding the goals, determinations,
                            and modifications.
        ``(b) State Certification of Building Energy Code Updates.--
                ``(1) General certification.--
                        ``(A) In general.--Not later than 2 years after the
                    date of enactment of the Lieberman-Warner Climate
                    Security Act of 2007, each State shall certify to the
                    Secretary that the State has reviewed and updated the
                    provisions of the residential and commercial building
                    codes of the State regarding energy efficiency.
                        ``(B) Energy savings.--A certification under
                    subparagraph (A) shall include a demonstration that the
                    applicable provisions of the State code meet or exceed,
                    as applicable--
                                ``(i)(I) the IECC (2006) for residential
                            buildings; or
                                ``(II) the ASHRAE Standard 90.1 (2004) for
                            commercial buildings; or
                                ``(ii) the quantity of energy savings
                            represented by the provisions referred to in
                            clause (i).
                ``(2) Revision of codes and standards.--
                        ``(A) In general.--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), not later than 2 years after the
                    determination or proposal, each State shall certify
                    that the State has reviewed and updated the provisions
                    of the residential and commercial building codes of the
                    State regarding energy efficiency.
                        ``(B) Energy savings.--A certification under
                    subparagraph (A) shall include a demonstration that the
                    applicable provisions of the State code meet or
                    exceed--
                                ``(i) the modified code or standard; or
                                ``(ii) the quantity of energy savings
                            represented by the modified code or standard.
                        ``(C) Failure to determine.--If the Secretary fails
                    to make a determination under subsection (a)(2)(A)(i)
                    by the date specified in subsection (a)(2), or if the
                    Secretary makes a negative determination, not later
                    than 2 years after the specified date or the date of
                    the determination, each State shall certify that the
                    State has--
                                ``(i) reviewed the revised code or
                            standard; and
                                ``(ii) updated the provisions of the
                            residential and commercial building codes of
                            the State as necessary to meet or exceed, as
                            applicable--
                                        ``(I) any provisions of a national
                                    code or standard determined to improve
                                    energy efficiency in buildings; or
                                        ``(II) energy savings achieved by
                                    those provisions through other means.
        ``(c) Achievement of Compliance by States.--
                ``(1) In general.--Not later than 3 years after the date on
            which a State makes a certification under subsection (b), the
            State shall certify to the Secretary that the State has
            achieved compliance with the building energy code that is the
            subject of the certification.
                ``(2) Rate of compliance.--The certification 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 State code during the preceding
            calendar year.
                ``(3) Compliance.--A State shall be considered to achieve
            compliance for purposes of paragraph (1) if--
                        ``(A) at least 90 percent of new and renovated
                    buildings covered by the State code during the
                    preceding calendar year substantially meet all the
                    requirements of the code; or
                        ``(B) the estimated excess energy use of new and
                    renovated buildings that did not meet the requirements
                    of the State code during the preceding calendar year,
                    as compared to a baseline of comparable buildings that
                    meet the requirements of the code, is not more than 10
                    percent of the estimated energy use of all new and
                    renovated buildings covered by the State code during
                    the preceding calendar year.
        ``(d) Failure To Certify.--
                ``(1) Extension of deadlines.--The Secretary shall extend a
            deadline for certification by a State under subsection (b) or
            (c) for not more than 1 additional year, if the State
            demonstrates to the satisfaction of the Secretary that the
            State has made--
                        ``(A) a good faith effort to comply with the
                    certification requirement; and
                        ``(B) significant progress with respect to the
                    compliance.
                ``(2) Noncompliance by state.--
                        ``(A) In general.--A State that fails to submit a
                    certification required under subsection (b) or (c), and
                    to which an extension is not provided under paragraph
                    (1), shall be considered to be out of compliance with
                    this section.
                        ``(B) Effect on local governments.--A local
                    government of a State that is out of compliance with
                    this section may be considered to be in compliance with
                    this section if the local government meets each
                    applicable certification requirement of this section.
        ``(e) Technical Assistance.--
                ``(1) In general.--The Secretary shall provide technical
            assistance (including building energy analysis and design
            tools, building demonstrations, and design assistance and
            training) to ensure that national model building energy codes
            and standards meet the goals described in subsection (a)(1).
                ``(2) Assistance to states.--The Secretary shall provide
            technical assistance to States--
                        ``(A) to implement this section, including
                    procedures for States to demonstrate that the codes of
                    the States achieve equivalent or greater energy savings
                    than the national model codes and standards;
                        ``(B) to improve and implement State residential
                    and commercial building energy efficiency codes; and
                        ``(C) to otherwise promote the design and
                    construction of energy-efficient buildings.
        ``(f) Incentive Funding.--
                ``(1) In general.--The Secretary shall provide incentive
            funding to States--
                        ``(A) to implement this section; and
                        ``(B) to improve and implement State residential
                    and commercial building energy efficiency codes,
                    including increasing and verifying compliance with the
                    codes.
                ``(2) Amount.--In determining whether, and in what amount,
            to provide incentive funding under this subsection, the
            Secretary shall take into consideration actions proposed by the
            State--
                        ``(A) to implement this section;
                        ``(B) to implement and improve residential and
                    commercial building energy efficiency codes; and
                        ``(C) to promote building energy efficiency through
                    use of the codes.
                ``(3) Additional funding.--The Secretary shall provide
            additional funding under this subsection for implementation of
            a plan to demonstrate a rate of compliance with applicable
            residential and commercial building energy efficiency codes at
            a rate of not less than 90 percent, 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 IECC (2006) (or a successor
                            code that is the subject of an affirmative
                            determination by 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 (2004)
                            (or a successor standard that is the subject of
                            an affirmative determination by the Secretary
                            under subsection (a)(2)(A)(i)); or
                        ``(B) in the case of a State in which no statewide
                    energy code exists for residential buildings or
                    commercial buildings, or in which the State code fails
                    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).
                ``(4) Training.--Of the amounts made available to carry out
            this subsection, the Secretary may use not more than $500,000
            for each State to train State and local officials to implement
            State or local energy codes in accordance with a plan described
            in paragraph (3).''.

    SEC. 5202. CONFORMING AMENDMENT.

        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) IECC.--The term `IECC' means the International
            Energy Conservation Code.''.

           TITLE VI--GLOBAL EFFORT TO REDUCE GREENHOUSE GAS EMISSIONS

    SEC. 6001. DEFINITIONS.

        In this title:
                (1) Baseline emission level.--The term ``baseline emission
            level'' means, as determined by the Administrator, the total
            average annual greenhouse gas emissions attributed to a
            category of covered goods of a foreign country during the
            period beginning on January 1, 2012, and ending on December 31,
            2014, based on--
                        (A) relevant data available for that period; and
                        (B) to the extent necessary with respect to a
                    specific category of covered goods, economic and
                    engineering models and best available information on
                    technology performance levels for the manufacture of
                    that category of covered goods.
                (2) Comparable action.--The term ``comparable action''
            means any greenhouse gas regulatory programs, requirements, and
            other measures adopted by a foreign country that, in
            combination, are comparable in effect to actions carried out by
            the United States to limit greenhouse gas emissions pursuant to
            this Act, as determined by the President, taking into
            consideration the level of economic development of the foreign
            country.
                (3) Compliance year.--The term ``compliance year'' means
            each calendar year for which the requirements of this title
            apply to a category of covered goods of a covered foreign
            country that is imported into the United States.
                (4) Covered foreign country.--The term ``covered foreign
            country'' means a foreign country that is included on the
            covered list prepared under section 6006(b)(3).
                (5) Covered good.--The term ``covered good'' means a good
            that (as identified by the Administrator by rule)--
                        (A) is a primary product;
                        (B) generates, in the course of the manufacture of
                    the good, a substantial quantity of direct greenhouse
                    gas emissions and indirect greenhouse gas emissions;
                    and
                        (C) is closely related to a good the cost of
                    production of which in the United States is affected by
                    a requirement of this Act.
                (6) Foreign country.--The term ``foreign country'' means a
            member of, or observer government to, the World Trade
            Organization (WTO), other than the United States.
                (7) Indirect greenhouse gas emissions.--The term ``indirect
            greenhouse gas emissions'' means any emissions of a greenhouse
            gas resulting from the generation of electricity that is
            consumed during the manufacture of a good.
                (8) International agreement.--The term ``international
            agreement'' means any international agreement to which the
            United States is a party, including the Marrakesh agreement
            establishing the World Trade Organization, done at Marrakesh on
            April 15, 1994.
                (9) International reserve allowance.--The term
            ``international reserve allowance'' means an allowance
            (denominated in units of metric tons of carbon dioxide
            equivalent) that is--
                        (A) purchased from a special reserve of allowances
                    pursuant to section 6006(a)(2); and
                        (B) used for purposes of meeting the requirements
                    of section 6006.
                (10) Primary product.--The term ``primary product'' means--
                        (A) iron, steel, aluminum, cement, bulk glass, or
                    paper; or
                        (B) any other manufactured product that--
                                (i) is sold in bulk for purposes of further
                            manufacture; and
                                (ii) generates, in the course of the
                            manufacture of the product, direct greenhouse
                            gas emissions and indirect greenhouse gas
                            emissions that are comparable (on an emissions-
                            per-dollar basis) to emissions generated in the
                            manufacture of products by covered facilities
                            in the industrial sector.

    SEC. 6002. PURPOSES.

        The purposes of this title are--
                (1) to promote a strong global effort to significantly
            reduce greenhouse gas emissions;
                (2) to ensure, to the maximum extent practicable, that
            greenhouse gas emissions occurring outside the United States do
            not undermine the objectives of the United States in addressing
            global climate change; and
                (3) to encourage effective international action to achieve
            those objectives through--
                        (A) agreements negotiated between the United States
                    and foreign countries; and
                        (B) measures carried out by the United States that
                    comply with applicable international agreements.

    SEC. 6003. INTERNATIONAL NEGOTIATIONS.

        (a) Finding.--Congress finds that the purposes described in section
    6002 can be most effectively addressed and achieved through agreements
    negotiated between the United States and foreign countries.
        (b) Negotiating Objective.--
                (1) Statement of policy.--It is the policy of the United
            States to work proactively under the United Nations Framework
            Convention on Climate Change and, in other appropriate forums,
            to establish binding agreements committing all major greenhouse
            gas-emitting nations to contribute equitably to the reduction
            of global greenhouse gas emissions.
                (2) Intent of congress regarding objective.--To the extent
            that the agreements described in subsection (a) involve
            measures that will affect international trade in any good or
            service, it is the intent of Congress that the negotiating
            objective of the United States shall be to focus multilateral
            and bilateral international agreements on the reduction of
            greenhouse gas emissions to advance achievement of the purposes
            described in section 6002.

    SEC. 6004. INTERAGENCY REVIEW.

        (a) Interagency Group.--
                (1) Establishment.--The President shall establish an
            interagency group to carry out this section.
                (2) Chairperson.--The chairperson of the interagency group
            established under paragraph (1) shall be the Secretary of
            State.
                (3) Requirement.--The Administrator shall be a member of
            the interagency group.
        (b) Determinations.--
                (1) In general.--Subject to paragraph (2), the interagency
            group established under subsection (a)(1) shall determine
            whether, and the extent to which, each foreign country has
            taken comparable action to limit the greenhouse gas emissions
            of the foreign country.
                (2) Exemption.--The interagency group may exempt from a
            determination under paragraph (1) any foreign country on the
            excluded list under section 6006(b)(2).
        (c) Report to President.--Not later than January 1, 2018, and
    annually thereafter, the interagency group shall submit to the
    President a report describing the determinations of the interagency
    group under subsection (b).

    SEC. 6005. PRESIDENTIAL DETERMINATIONS.

        (a) In General.--Not later than January 1, 2019, and annually
    thereafter, the President shall determine whether each foreign country
    that is subject to interagency review under section 6004(b) has taken
    comparable action to limit the greenhouse gas emissions of the foreign
    country, taking into consideration--
                (1) the baseline emission levels of the foreign country;
            and
                (2) applicable reports submitted under section 6004(c).
        (b) Reports.--The President shall--
                (1) submit to Congress an annual report describing the
            determinations of the President under subsection (a) for the
            most recent calendar year; and
                (2) publish the determinations in the Federal Register.

    SEC. 6006. INTERNATIONAL RESERVE ALLOWANCE PROGRAM.

        (a) Establishment.--
                (1) In general.--The Administrator shall establish a
            program under which the Administrator, during the 1-year period
            beginning on January 1, 2019, and annually thereafter, shall
            offer for sale to United States importers international reserve
            allowances in accordance with this subsection.
                (2) Source.--International reserve allowances under
            paragraph (1) shall be issued from a special reserve of
            allowances that is separate from, and established in addition
            to, the quantity of allowances established under section 1201.
                (3) Price.--
                        (A) In general.--Subject to subparagraph (B), the
                    Administrator shall establish, by rule, a methodology
                    for determining the price of international reserve
                    allowances for each compliance year at a level that
                    does not exceed the market price of allowances
                    established under section 1201 for the compliance year.
                        (B) Maximum price.--The price for an international
                    reserve allowance under subparagraph (A) shall not
                    exceed the clearing price for current compliance year
                    allowances established at the most recent auction of
                    allowances by the Corporation.
                (4) Serial number.--The Administrator shall assign a unique
            serial number to each international reserve allowance issued
            under this subsection.
                (5) Trading system.--The Administrator may establish, by
            rule, a system for the sale, exchange, purchase, transfer, and
            banking of international reserve allowances.
                (6) Regulated entities.--International reserve allowances
            may not be submitted by regulated entities to comply with the
            allowance submission requirements of section 1202.
                (7) Proceeds.--All proceeds from the sale of international
            reserve allowances under this subsection shall be allocated to
            a program that the Administrator, in coordination with the
            Secretary of State, shall establish to mitigate the negative
            impacts of global climate change on disadvantaged communities
            in other countries.
        (b) Foreign Country Lists.--
                (1) In general.--Not later than January 1, 2020, and
            annually thereafter, the President shall develop and publish in
            the Federal Register 2 lists of foreign countries, in
            accordance with this subsection.
                (2) Excluded list.--
                        (A) In general.--The President shall identify and
                    publish in a list, to be known as the ``excluded
                    list''--
                                (i) each foreign country determined by the
                            President under section 6005(a) to have taken
                            action comparable to that taken by the United
                            States to limit the greenhouse gas emissions of
                            the foreign country; and
                                (ii) each foreign country the share of
                            total global greenhouse gas emissions of which
                            is below the de minimis percentage described in
                            subparagraph (B).
                        (B) De minimis percentage.--The de minimis
                    percentage referred to in subparagraph (A) is a
                    percentage of total global greenhouse gas emissions of
                    not more than 0.5, as determined by the President, for
                    the most recent calendar year for which emissions and
                    other relevant data is available, taking into
                    consideration, as necessary, the annual average
                    deforestation rate during a representative period for a
                    foreign country that is a developing country.
                (3) Covered list.--
                        (A) In general.--The President shall identify and
                    publish in a list, to be known as the ``covered list'',
                    each foreign country the covered goods of which are
                    subject to the requirements of this section.
                        (B) Requirement.--The covered list shall include
                    each foreign country that is not included on the
                    excluded list under paragraph (2).
        (c) Written Declarations.--
                (1) In general.--Effective beginning January 1, 2020, a
            United States importer of any covered good shall, as a
            condition of importation or withdrawal for consumption from a
            warehouse of the covered good, submit to the Administrator and
            the appropriate office of the U.S. Customs and Border
            Protection a written declaration with respect to each such
            importation or withdrawal.
                (2) Contents.--A written declaration under paragraph (1)
            shall contain a statement that--
                        (A) the applicable covered good is accompanied by a
                    sufficient number of international reserve allowances,
                    as determined under subsection (d); or
                        (B) the covered good is from a foreign country on
                    the excluded list under subsection (b)(2).
                (3) Inclusion.--A written declaration described in
            paragraph (2)(A) shall include the unique serial number of each
            emission allowance associated with the importation of the
            applicable covered good.
                (4) Failure to declare.--
                        (A) In general.--Except as provided in subparagraph
                    (B), an imported covered good that is not accompanied
                    by a written declaration under this subsection shall
                    not be permitted to enter the customs territory of the
                    United States.
                        (B) Exception for certain imports.--Subparagraph
                    (A) shall not apply to a covered good of a foreign
                    country if the President determines that--
                                (i) the foreign country has taken
                            comparable action to limit the greenhouse gas
                            emissions of the foreign country, in accordance
                            with section 6005;
                                (ii) the United Nations has identified the
                            foreign country as among the least-developed of
                            developing countries; or
                                (iii) the foreign country is on the
                            excluded list under subsection (b)(2).
                (5) Corrected declaration.--
                        (A) In general.--If, after making a declaration
                    required under this subsection, an importer has reason
                    to believe that the declaration contains information
                    that is not correct, the importer shall provide a
                    corrected declaration by not later than 30 days after
                    the date of discovery of the error, in accordance with
                    subparagraph (B).
                        (B) Method.--A corrected declaration under
                    subparagraph (A) shall be in the form of a letter or
                    other written statement to the Administrator and the
                    office of the U.S. Customs and Border Protection to
                    which the original declaration was submitted.
        (d) Quantity of Allowances Required.--
                (1) Methodology.--
                        (A) In general.--The Administrator shall establish,
                    by rule, a method for calculating the required number
                    of international reserve allowances that a United
                    States importer must submit, together with a written
                    declaration under subsection (c), for each category of
                    covered goods of each covered foreign country.
                        (B) Formula.--The Administrator shall develop a
                    general formula for calculating the international
                    reserve allowance requirement that applies, on a per
                    unit basis, to each covered good of a covered foreign
                    country that is imported during each compliance year.
                (2) Initial compliance year.--
                        (A) In general.--Subject to subparagraph (B), the
                    methodology under paragraph (1) shall establish an
                    international reserve allowance requirement (per unit
                    imported into the United States) for the initial
                    compliance year for each category of covered goods of
                    each covered foreign country that is equal to the
                    quotient obtained by dividing--
                                (i) the excess, if any, of the total
                            emissions from the covered foreign country that
                            are attributable to the category of covered
                            goods produced during the most recent year for
                            which data are available, over the baseline
                            emission level of the covered foreign country
                            for that category; and
                                (ii) the total quantity of the covered good
                            produced in the covered foreign country during
                            the most recent calendar year.
                        (B) Adjustments.--The Administrator shall adjust
                    the requirement under subparagraph (A)--
                                (i) in accordance with the ratio that--
                                        (I) the quantity of allowances that
                                    were allocated at no cost to entities
                                    within the industry sector
                                    manufacturing the covered goods for the
                                    compliance year during which the
                                    covered goods were imported into the
                                    United States; bears to
                                        (II) the greenhouse gas emissions
                                    of that industry sector; and
                                (ii) to take into account the level of
                            economic development of the covered foreign
                            country in which the covered goods were
                            produced.
                (3) Subsequent compliance years.--For each subsequent
            compliance year, the Administrator shall revise, as
            appropriate, the international reserve allowance requirement
            applicable to each category of imported covered goods of each
            covered foreign country to reflect changes in the factors
            described in paragraph (2)(B).
                (4) Publication.--Not later than 90 days before the
            beginning of each compliance year, the Administrator shall
            publish in the Federal Register a schedule describing the
            required number of international reserve allowances for each
            category of imported covered goods of each covered foreign
            country, as calculated under this subsection.
        (e) Foreign Allowances and Credits.--
                (1) Foreign allowances.--
                        (A) In general.--A United States importer may
                    submit, in lieu of an international reserve allowance
                    issued under this section, a foreign allowance or
                    similar compliance instrument distributed by a foreign
                    country pursuant to a cap and trade program that
                    represents a comparable action.
                        (B) Commensurate cap and trade program.--For
                    purposes of subparagraph (A), a cap and trade program
                    that represents a comparable action shall include any
                    greenhouse gas regulatory program adopted by a covered
                    foreign country to limit the greenhouse gas emissions
                    of the covered foreign country, if the President
                    certifies that the program--
                                (i)(I) places a quantitative limitation on
                            the total quantity of greenhouse gas emissions
                            of the covered foreign country (expressed in
                            terms of tons emitted per calendar year); and
                                (II) achieves that limitation through an
                            allowance trading system;
                                (ii) satisfies such criteria as the
                            President may establish for requirements
                            relating to the enforceability of the cap and
                            trade program, including requirements for
                            monitoring, reporting, verification procedures,
                            and allowance tracking; and
                                (iii) is a comparable action.
                (2) Foreign credits.--
                        (A) In general.--A United States importer may
                    submit, in lieu of an international reserve allowance
                    issued under this section, a foreign credit or a credit
                    for an international offset project that the
                    Administrator has authorized for use under subtitle E
                    of title II.
                        (B) Application.--The limitation on the use of
                    international reserve allowances by regulated entities
                    under subsection (a)(6) shall not apply to a United
                    States importer for purposes of this paragraph.
        (f) Retirement of Allowances.--The Administrator shall retire each
    international reserve allowance, foreign allowance, and foreign credit
    submitted to achieve compliance with this section.
        (g) Consistency With International Agreements.--The Administrator,
    in consultation with the Secretary of State, shall adjust the
    international reserve allowance requirements established under this
    section (including the quantity of international reserve allowances
    required for each category of covered goods of a covered foreign
    country) as the Administrator determines to be necessary to ensure that
    the United States complies with all applicable international
    agreements.
        (h) Termination.--The international reserve allowance requirements
    of this section shall not apply to a covered good of a covered foreign
    country in any case in which the President makes a determination
    described in subsection (b)(2) with respect to the covered goods of
    that covered foreign country.
        (i) Final Regulations.--Not later than January 1, 2019, the
    Administrator shall promulgate such regulations as the Administrator
    determines to be necessary to carry out this section.

    SEC. 6007. ADJUSTMENT OF INTERNATIONAL RESERVE ALLOWANCE REQUIREMENTS.

        (a) In General.--Not later than January 1, 2023, and annually
    thereafter, the President shall prepare and submit to Congress a report
    that assesses the effectiveness of the applicable international reserve
    allowance requirements under section 6006 with respect to the covered
    goods of each covered foreign country.
        (b) Inadequate Requirements.--If the President determines that an
    applicable international reserve allowance requirement is not adequate
    to achieve the purposes of this title, the President, simultaneously
    with the submission of the report under subsection (a), shall--
                (1) adjust the requirement; or
                (2) take such other action as the President determines to
            be necessary to improve the effectiveness of the requirement,
            in accordance with all applicable international agreements.
        (c) Effective Date.--An adjustment under subsection (b)(1) shall
    take effect beginning on January 1 of the compliance year immediately
    following the date on which the adjustment is made.

                     TITLE VII--REVIEWS AND RECOMMENDATIONS

    SEC. 7001. NATIONAL ACADEMY OF SCIENCES REVIEWS.

        (a) In General.--Not later than 1 year after the date of enactment
    of this Act, the Administrator shall offer to enter into a contract
    with the National Academy of Sciences under which the Academy shall,
    not later than January 1, 2012, and every 3 years thereafter, submit to
    Congress and the Administrator a report that includes an analysis of--
                (1) the latest scientific information and data relevant to
            global climate change;
                (2) the performance of this Act and other policies in
            reducing greenhouse gas emissions and mitigating the adverse
            impacts of global climate change;
                (3) the performance of this Act in ensuring that the Land
            and Water Conservation Fund established under section 2 of the
            Land and Water Conservation Fund Act of 1965 (16 U.S.C. 460l-5)
            receives funds that are sufficient to carry out the purposes of
            that Fund; and
                (4) the performance of this Act in ensuring that the Bureau
            of Land Management and the Forest Service receive funds that
            are sufficient to enable those agencies to suppress wildland
            fire effectively and thereby minimize wildfire damage.
        (b) Latest Scientific Information.--The analysis required under
    subsection (a)(1) shall--
                (1) address existing reports, including the most recent
            assessment report of the Intergovernmental Panel on Climate
            Change; and
                (2) include a description of--
                        (A) trends in and projections for total United
                    States greenhouse gas emissions;
                        (B) trends in and projections for total worldwide
                    greenhouse gas emissions;
                        (C) current and projected future atmospheric
                    concentrations of greenhouse gases;
                        (D) current and projected future global average
                    temperature, including an analysis of whether an
                    increase of global average temperature in excess of 3.6
                    degrees Fahrenheit (2 degrees Celsius) above the
                    preindustrial average has occurred or is more likely
                    than not to occur in the foreseeable future as a result
                    of anthropogenic climate change;
                        (E) current and projected future adverse impacts of
                    global climate change on human populations, wildlife,
                    and natural resources; and
                        (F) trends in and projections for the health of the
                    oceans and ocean ecosystems, including predicted
                    changes in ocean acidity, temperatures, the extent of
                    coral reefs, and other indicators of ocean ecosystem
                    health, resulting from anthropogenic carbon dioxide and
                    climate change.
        (c) Performance of This Act and Existing Technologies.--The
    analysis required under subsection (a)(2) shall include a description
    of--
                (1) the extent to which this Act, in concert with other
            policies, will prevent a dangerous increase in global average
            temperature;
                (2) the extent to which this Act, in concert with other
            policies, will prevent dangerous atmospheric concentrations of
            greenhouse gases;
                (3) the current and future projected deployment of
            technologies and practices that reduce or limit greenhouse gas
            emissions, including--
                        (A) technologies for capture and disposal of
                    greenhouse gases;
                        (B) efficiency improvement technologies;
                        (C) zero-greenhouse gas emitting energy
                    technologies, including solar, wind, geothermal, and
                    nuclear technologies; and
                        (D) above- and below-ground biological
                    sequestration technologies;
                (4) the extent to which this Act and other policies are
            accelerating the development and commercial deployment of
            technologies and practices that reduce and limit greenhouse gas
            emissions;
                (5) the extent to which the allocations and distributions
            of emission allowances and auction proceeds under this Act are
            advancing the purposes of this Act, and whether any of those
            allocations and distributions should be modified, including by
            increasing the percentage of annual Emission Allowance Account
            being auctioned, to better carry out the purposes of this Act;
                (6) whether the motor vehicle fuel and motor vehicle and
            nonroad regulations within the scope of Executive Order 13432
            (72 Fed. Reg. 27717; relating to cooperation among agencies in
            protecting the environment with respect to greenhouse gas
            emissions from motor vehicles, nonroad vehicles, and nonroad
            engines) have been finalized and implemented by Federal
            agencies and departments;
                (7) whether any other transportation-related programs,
            including fuel economy standard reform, greenhouse gas vehicle
            emissions standards, renewable fuel volume mandates, low-carbon
            fuel standards, and activities to reduce vehicle miles traveled
            have been finalized and implemented by any Federal agencies or
            departments;
                (8) whether any regulation or program described in
            paragraph (12) or (13) is expected to achieve, as compared to
            the baseline greenhouse gas emissions consistent with the
            reference case contained in the report of the Energy
            Information Administration entitled ``Annual Energy Outlook
            2006'', at a minimum--
                        (A) at least a 6.2-percent reduction in cumulative
                    greenhouse gas emissions from the light-duty motor
                    vehicle sector, including light-duty vehicles and
                    light-duty trucks, during the period beginning on
                    January 1, 2010, and ending on December 31, 2020; or
                        (B) a cumulative reduction of approximately
                    1,140,000 metric tons of carbon dioxide equivalent,
                    measured on a full fuel cycle basis;
                (9) whether additional measures, including an increase in
            the earned income tax credit, a reduction in payroll taxes, or
            the implementation of electronic benefit transfers by State
            health and human services agencies to reach low-income
            individuals who are not required to file Federal income tax
            returns, are needed to help low- and moderate-income
            individuals respond to changes in the cost of energy-related
            goods and services;
                (10) the feasibility of expanding the definition of the
            term ``covered facility'' under this Act;
                (11) the feasibility of expanding the scope of the
            compliance obligation established under section 1202(a);
                (12) the feasibility of reducing the number of emission
            allowances comprising the Emission Allowance Account for 1 or
            more calendar years under this Act;
                (13) the feasibility of establishing policies for reducing
            greenhouse gas emissions over and above those policies
            established by this Act;
                (14) the feasibility of accelerating the commercial
            deployment of existing and emerging renewable energy
            technologies for electricity generation, from solar, wind,
            geothermal energy, ocean energy (including tidal, wave,
            current, and thermal) or biomass (as defined in section 203(b)
            of the Energy Policy Act of 2005 (42 U.S.C. 15852(b))),
            utilizing a bonus emission allowance program comparable to the
            program established under subtitle F of title III; and
                (15) the results of a report on products manufactured with
            recycled materials that--
                        (A) describes the greenhouse gas emission
                    reductions those products can achieve;
                        (B) summarizes and assesses the results of research
                    on manufactured products and scrap recycling
                    activities; and
                        (C) evaluates the lifecycle greenhouse gas emission
                    reduction and other benefits and issues associated
                    with--
                                (i) recycling scrap metal (including end-
                            of-life vehicles), recovered fiber (or paper),
                            scrap electronics, scrap glass, scrap plastics,
                            scrap rubber, scrap tires, and scrap textiles
                            with respect to reduction or avoidance of
                            greenhouse gas to the environment;
                                (ii) using recyclable materials in
                            manufactured products;
                                (iii) designing and manufacturing products
                            that increase recyclable output;
                                (iv) eliminating or reducing the use of
                            substances and materials in products that
                            decrease recyclable output; and
                                (v) establishing a standardized system for
                            lifecycle greenhouse gas emission reduction
                            measurement and certification for the
                            manufactured products and scrap recycling
                            sectors, including the potential options for
                            the structure and operation of such a system.

    SEC. 7002. ENVIRONMENTAL PROTECTION AGENCY REVIEW.

        Not later than January 1, 2012, the Administrator shall submit to
    Congress a report indicating--
                (1) the latest scientific information and data relevant to
            the health effects of mercury emissions from coal-fired
            electric power generating facilities;
                (2) the state of the technology designed to reduce mercury
            emissions from coal combustion, including the efficacy of the
            technology with respect to each coal type; and
                (3) the extent to which the implementation of this Act is
            assisting in bringing concentrations of particulate matter and
            ozone into line with National Ambient Air Quality Standards.

    SEC. 7003. ENVIRONMENTAL PROTECTION AGENCY RECOMMENDATIONS.

        (a) Review.--Not later than January 1, 2013, and every 3 years
    thereafter, the Administrator shall submit to Congress recommendations
    for action in response to the most recent report submitted by the
    National Academy of Sciences under section 7001 and the report
    submitted by the Administrator under section 7002.
        (b) Categories of Action.--The categories of action eligible for
    inclusion in the recommendations submitted under subsection (a) include
    proposed legislation recommending--
                (1) expansion of the definition of the term ``covered
            facility'' under this Act;
                (2) expansion of the scope of the compliance obligation
            established under section 1202;
                (3) adjustment of the number of emission allowances
            comprising the Emission Allowance Account for 1 or more
            calendar years under this Act;
                (4) establishment of policies for reducing greenhouse gas
            emissions over and above those policies established under this
            Act;
                (5) establishment of policies for reducing nationwide
            emissions into the atmosphere of sulfur dioxide, nitrogen
            oxides, and mercury in excess of the reductions resulting from
            the implementation of this Act; and
                (6) establishment of a program, similar to the program
            established under subtitle F of title III, for distributing
            bonus emission allowances in order to accelerate the commercial
            deployment of existing and emerging renewable energy
            technologies for electricity generation.
        (c) Consistency With Reviews.--The Administrator shall include with
    each submission of recommendations under subsection (a) an explanation
    of any inconsistencies between the recommendations and the reviews
    submitted by the National Academy of Sciences under section 7001 and
    the report submitted by the Administrator under section 7002.
        (d) Savings Clause.--Nothing in this title limits, procedurally
    affects, or otherwise restricts the authority of the Administrator, a
    State, or any person to use authorities under this Act or any other law
    to adopt or enforce any rule.

    SEC. 7004. PRESIDENTIAL RECOMMENDATIONS.

        (a) Establishment of the Interagency Climate Change Task Force.--
    Not later than January 1, 2019, the President shall establish an
    Interagency Climate Change Task Force.
        (b) Composition.--The members of the Interagency Climate Change
    Task Force shall be--
                (1) the Administrator;
                (2) the Secretary of Energy;
                (3) the Secretary of the Treasury;
                (4) the Secretary of Commerce; and
                (5) such other Cabinet Secretaries as the President may
            name to the membership of the Task Force.
        (c) Chairman.--The Administrator shall act as Chairman of the
    Interagency Climate Change Task Force.
        (d) Report to President.--
                (1) In general.--Not later than April 1, 2019, the Task
            Force shall make public and submit to the President a consensus
            report making recommendations, including specific legislation
            for the President to recommend to Congress.
                (2) Basis.--The report shall be based on the third set of
            recommendations submitted by the Administrator to Congress
            under section 7003.
                (3) Inclusions.--The Task Force shall include with the
            consensus report an explanation of any inconsistencies between
            the consensus report and the third set of recommendations
            submitted by the Administrator to Congress under section 7003.
        (e) Presidential Recommendation to Congress.--Not later than July
    1, 2020, the President shall submit to Congress the text of a proposed
    Act based on the consensus report submitted to the President under
    subsection (d).

    SEC. 7005. ADAPTATION ASSESSMENTS AND PLAN.

        (a) Regional Estimates.--
                (1) Estimates.--
                        (A) In general.--The Administrator, in consultation
                    with the officials described in paragraph (2) and
                    relevant State agencies, shall conduct 6 regional
                    infrastructure cost assessments in various regions of
                    the United States, and a national cost assessment, to
                    provide estimates of the range of costs that should be
                    anticipated for adaptation to the impacts of climate
                    change.
                        (B) Various probabilities.--The Administrator shall
                    develop the estimates under subparagraph (A) for low,
                    medium, and high probabilities of climate change and
                    the potential impacts of climate change.
                (2) Description of officials.--The officials referred to in
            paragraph (1) are--
                        (A) the Secretary of Agriculture;
                        (B) the Secretary of Commerce;
                        (C) the Secretary of Defense;
                        (D) the Secretary of Energy;
                        (E) the Secretary of Health and Human Services;
                        (F) the Secretary of Homeland Security;
                        (G) the Secretary of Housing and Urban Development;
                        (H) the Secretary of the Interior;
                        (I) the Secretary of Transportation;
                        (J) the Director of United States Geological
                    Survey; and
                        (K) the heads of such other Federal agencies and
                    departments as the Administrator determines to be
                    necessary.
                (3) Submission to congress.--Not later than 1 year after
            the date of enactment of this Act, the Administrator shall
            submit to Congress a report describing the results of the
            assessments conducted under this subsection.
        (b) Adaptation Plan.--
                (1) In general.--Not later than 180 days after the date of
            enactment of this Act, the Administrator shall submit to
            Congress a climate change adaptation plan for the United
            States, based on--
                        (A) assessments performed by the United Nations
                    Intergovernmental Panel on Climate Change in accordance
                    with the Global Change Research Act of 1990 (15 U.S.C.
                    2921 et seq.); and
                        (B) any other assessment prepared by a Federal,
                    regional, State, or local government entity that is--
                                (i) scientific;
                                (ii) peer-reviewed; or
                                (iii) subjected to public comment.
                (2) Inclusions.--The adaptation plan under paragraph (1)
            shall include--
                        (A) a prioritized list of vulnerable systems and
                    regions in the United States;
                        (B) requirements for coordination between Federal,
                    State, and local governments to ensure that key public
                    infrastructure, safety, health, and land use planning
                    and control issues are addressed;
                        (C) requirements for coordination among the Federal
                    Government, industry, and communities;
                        (D) requirements for management of climate change,
                    including the need for information derived from
                    inundation prediction systems on the impacts to coastal
                    communities;
                        (E) an assessment of climate change science
                    research needs, including probabilistic assessments as
                    an aid to planning;
                        (F) an assessment of climate change technology
                    needs; and
                        (G) regional and national cost assessments for the
                    range of costs that should be anticipated for adapting
                    to the impacts of climate change.
        (c) Impacts of Climate Change on Low-Income Populations.--
                (1) In general.--The Administrator shall conduct research
            on the impact of climate change on low-income populations in
            all countries, including--
                        (A) an assessment of the adverse impact of climate
                    change on--
                                (i) low-income populations in the United
                            States; and
                                (ii) developing countries;
                        (B)(i) an identification of appropriate climate
                    change adaptation measures and programs for developing
                    countries and low-income populations;
                        (ii) an assessment of the impact of the measures
                    and programs on low-income populations; and
                        (C) an estimate of the costs of developing and
                    implementing those climate change adaptation and
                    mitigation programs.
                (2) Report.--Not later than 1 year after the date of
            enactment of this Act, the Administrator shall submit to
            Congress a report describing the results of the research
            conducted under paragraph (1).

    SEC. 7006. STUDY BY ADMINISTRATOR OF AVIATION SECTOR GREENHOUSE GAS
                  EMISSIONS.

        (a) In General.--The Administrator shall enter into an agreement
    with the National Academy of Sciences under which the Academy shall
    conduct a study on greenhouse gas emissions associated with the
    aviation industry, including--
                (1) a determination of appropriate data necessary to make
            determinations of emission inventories, considering fuel use,
            airport operations, ground equipment, and all other sources of
            emissions in the aviation industry;
                (2) an estimate of projected industry emissions for the
            following 5-year, 20-year, and 50-year periods;
                (3) based on existing literature, research and surveys to
            determine the existing best practices for emission reduction in
            the aviation sector;
                (4) recommendations on areas of focus for additional
            research for technologies and operations with the highest
            potential to reduce emissions; and
                (5) recommendations of actions that the Federal Government
            could take to encourage or require additional emissions
            reductions.
        (b) Consultation.--In developing the parameters of the study under
    this section, the Administrator shall conduct the study under this
    section in consultation with--
                (1) the Secretary of Transportation, acting through the
            Administrator of the Federal Aviation Administration; and
                (2) other appropriate Federal agencies and departments.

      TITLE VIII--FRAMEWORK FOR GEOLOGICAL SEQUESTRATION OF CARBON DIOXIDE

    SEC. 8001. NATIONAL DRINKING WATER REGULATIONS.

        (a) In General.--Section 1421 of the Safe Drinking Water Act (42
    U.S.C. 300h) is amended--
                (1) in subsection (b)(1), by striking ``subsection (d)(2)''
            and inserting ``subsection (e)(2)'';
                (2) by redesignating subsection (d) as subsection (e); and
                (3) by inserting after subsection (c) the following:
        ``(d) Carbon Dioxide.--
                ``(1) Regulations.--Not later than 1 year after the date of
            enactment of the Lieberman-Warner Climate Security Act of 2007,
            the Administrator shall promulgate regulations for permitting
            commercial-scale underground injection of carbon dioxide for
            purposes of geological sequestration to address climate change,
            including provisions--
                        ``(A) for monitoring and controlling the long-term
                    storage of carbon dioxide and avoiding, to the maximum
                    extent practicable, any release of carbon dioxide into
                    the atmosphere, and for ensuring protection of
                    underground sources of drinking water, human health,
                    and the environment; and
                        ``(B) relating to long-term liability associated
                    with commercial-scale geological sequestration.
                ``(2) Subsequent reports.--Not later than 5 years after the
            date on which regulations are promulgated pursuant to paragraph
            (1), and not less frequently than once every 5 years
            thereafter, the Administrator shall submit to Congress a report
            that contains an evaluation of the effectiveness of the
            regulations, based on current knowledge and experience, with
            particular emphasis on any new information on potential impacts
            of commercial-scale geological sequestration on drinking water,
            human health, and the environment.
                ``(3) Revision.--If the Administrator determines, based on
            a report under paragraph (2), that regulations promulgated
            pursuant to paragraph (1) require revision, the Administrator
            shall promulgate revised regulations not later than 1 year
            after the date on which the applicable report is submitted to
            Congress under paragraph (2).''.
        (b) Conforming Amendment.--Section 1447(a)(4) of the Safe Drinking
    Water Act (42 U.S.C. 300j-6(a)(4)) is amended by striking ``section
    1421(d)(2)'' and inserting ``section 1421(e)(2)''.

    SEC. 8002. ASSESSMENT OF GEOLOGICAL STORAGE CAPACITY FOR CARBON
                  DIOXIDE.

        (a) Definitions.--In this section:
                (1) Assessment.--The term ``assessment'' means the national
            assessment of capacity for carbon dioxide completed under
            subsection (f).
                (2) Capacity.--The term ``capacity'' means the portion of a
            storage formation that can retain carbon dioxide in accordance
            with the requirements (including physical, geological, and
            economic requirements) established under the methodology
            developed under subsection (b).
                (3) Engineered hazard.--The term ``engineered hazard''
            includes the location and completion history of any well that
            could affect a storage formation or capacity.
                (4) Risk.--The term ``risk'' includes any risk posed by a
            geomechanical, geochemical, hydrogeological, structural, or
            engineered hazard.
                (5) Secretary.--The term ``Secretary'' means the Secretary
            of the Interior, acting through the Director of the United
            States Geological Survey.
                (6) Storage formation.--The term ``storage formation''
            means a deep saline formation, unmineable coal seam, oil or gas
            reservoir, or other geological formation that is capable of
            accommodating a volume of industrial carbon dioxide.
        (b) Methodology.--Not later than 1 year after the date of enactment
    of this Act, the Secretary shall develop a methodology for conducting
    an assessment under subsection (f), taking into consideration--
                (1) the geographical extent of all potential storage
            formations in all States;
                (2) the capacity of the potential storage formations;
                (3) the injectivity of the potential storage formations;
                (4) an estimate of potential volumes of oil and gas
            recoverable by injection and storage of industrial carbon
            dioxide in potential storage formations;
                (5) the risk associated with the potential storage
            formations; and
                (6) the work performed to develop the Carbon Sequestration
            Atlas of the United States and Canada completed by the
            Department of Energy in April 2006.
        (c) Coordination.--
                (1) Federal coordination.--
                        (A) Consultation.--The Secretary shall consult with
                    the Secretary of Energy and the Administrator regarding
                    data sharing and the format, development of
                    methodology, and content of the assessment to ensure
                    the maximum usefulness and success of the assessment.
                        (B) Cooperation.--The Secretary of Energy and the
                    Administrator shall cooperate with the Secretary to
                    ensure, to the maximum extent practicable, the
                    usefulness and success of the assessment.
                (2) State coordination.--The Secretary shall consult with
            State geological surveys and other relevant entities to ensure,
            to the maximum extent practicable, the usefulness and success
            of the assessment.
        (d) External Review and Publication.--On completion of the
    methodology under subsection (b), the Secretary shall--
                (1) publish the methodology and solicit comments from the
            public and the heads of affected Federal and State agencies;
                (2) establish a panel of individuals with expertise in the
            matters described in paragraphs (1) through (5) of subsection
            (b) composed, as appropriate, of representatives of Federal
            agencies, institutions of higher education, nongovernmental
            organizations, State organizations, industry, and international
            geosciences organizations to review the methodology and
            comments received under paragraph (1); and
                (3) on completion of the review under paragraph (2),
            publish in the Federal Register the revised final methodology.
        (e) Periodic Updates.--The methodology developed under this section
    shall be updated periodically (including not less frequently than once
    every 5 years) to incorporate new data as the data becomes available.
        (f) National Assessment.--
                (1) In general.--Not later than 2 years after the date of
            publication of the methodology under subsection (d)(3), the
            Secretary, in consultation with the Secretary of Energy and
            State geological surveys, shall complete a national assessment
            of the capacity for carbon dioxide storage in accordance with
            the methodology.
                (2) Geological verification.--As part of the assessment,
            the Secretary shall carry out a characterization program to
            supplement the geological data relevant to determining storage
            capacity in carbon dioxide in geological storage formations,
            including--
                        (A) well log data;
                        (B) core data; and
                        (C) fluid sample data.
                (3) Partnership with other drilling programs.--As part of
            the drilling characterization under paragraph (2), the
            Secretary shall enter into partnerships, as appropriate, with
            other entities to collect and integrate data from other
            drilling programs relevant to the storage of carbon dioxide in
            geologic formations.
                (4) Incorporation into natcarb.--
                        (A) In general.--On completion of the assessment,
                    the Secretary shall incorporate the results of the
                    assessment using, to the maximum extent practicable--
                                (i) the NatCarb database; or
                                (ii) a new database developed by the
                            Secretary, as the Secretary determines to be
                            necessary.
                        (B) Ranking.--The database shall include the data
                    necessary to rank potential storage sites--
                                (i) for capacity and risk;
                                (ii) across the United States;
                                (iii) within each State;
                                (iv) by formation; and
                                (v) within each basin.
                (5) Report.--Not later than 180 days after the date on
            which the assessment is completed, the Secretary shall submit
            to the Committee on Energy and Natural Resources of the Senate
            and the Committee on Science and Technology of the House of
            Representatives a report describing the results of the
            assessment.
                (6) Periodic updates.--The assessment shall be updated
            periodically (including not less frequently than once every 5
            years) as necessary to support public and private sector
            decisionmaking, as determined by the Secretary.

    SEC. 8003. STUDY OF THE FEASIBILITY RELATING TO CONSTRUCTION OF
                  PIPELINES AND GEOLOGICAL CARBON DIOXIDE SEQUESTRATION
                  ACTIVITIES.

        (a) In General.--The Secretary of Energy, in coordination with the
    Administrator, the Federal Energy Regulatory Commission, the Secretary
    of Transportation, and the Secretary of the Interior, shall conduct a
    study to assess the feasibility of the construction of--
                (1) pipelines to be used for the transportation of carbon
            dioxide for the purpose of sequestration or enhanced oil
            recovery; and
                (2) geological carbon dioxide sequestration facilities.
        (b) Scope.--The study shall consider--
                (1) any barrier or potential barrier in existence as of the
            date of enactment of this Act, including any technical, siting,
            financing, or regulatory barrier, relating to--
                        (A) the construction of pipelines to be used for
                    the transportation of carbon dioxide for the purpose of
                    sequestration or enhanced oil recovery; or
                        (B) the geological sequestration of carbon dioxide;
                (2) any market risk (including throughput risk) relating
            to--
                        (A) the construction of pipelines to be used for
                    the transportation of carbon dioxide for the purpose of
                    sequestration or enhanced oil recovery; or
                        (B) the geological sequestration of carbon dioxide;
                (3) any regulatory, financing, or siting option that, as
            determined by the Secretary of Energy, would--
                        (A) mitigate any market risk described in paragraph
                    (2); or
                        (B) help ensure the construction of pipelines
                    dedicated to the transportation of carbon dioxide for
                    the purpose of sequestration or enhanced oil recovery;
                (4) the means by which to ensure the safe handling and
            transportation of carbon dioxide;
                (5) any preventive measure to ensure the integration of
            pipelines to be used for the transportation of carbon dioxide
            for the purpose of sequestration or enhanced oil recovery; and
                (6) any other appropriate use, as determined by the
            Secretary of Energy, in coordination with the Administrator,
            the Federal Energy Regulatory Commission, the Secretary of
            Transportation, and the Secretary of the Interior.
        (c) Report.--Not later than 180 days after the date of enactment of
    this Act, the Secretary of Energy shall submit to the Congress a report
    describing the results of the study.

    SEC. 8004. LIABILITIES FOR CLOSED GEOLOGICAL STORAGE SITES.

        (a) Establishment of Task Force.--As soon as practicable after the
    date of enactment of this Act, the Administrator shall establish a task
    force, to be composed of an equal number of stakeholders, the public,
    subject matter experts, and members of the private sector, to conduct a
    study of the legal framework, environmental and safety considerations,
    and cost implications of potential Federal assumption of liability with
    respect to closed geological storage sites.
        (b) Report.--Not later than 18 months after the date of enactment
    of this Act, the task force established under subsection (a) shall
    submit to Congress a report describing the results of the study
    conducted under subsection (a), including recommendations of the task
    force, if any, with respect to the framework described in that
    subsection.

                            TITLE IX--MISCELLANEOUS

    SEC. 9001. PARAMOUNT INTEREST WAIVER.

        (a) In General.--If the President determines that a national
    security emergency exists and, in light of information that was not
    available as of the date of enactment of this Act, it is in the
    paramount interest of the United States to modify any requirement under
    this Act to minimize the effects of the emergency, the President may,
    after opportunity for public notice and comment, temporarily adjust,
    suspend, or waive any regulations promulgated pursuant to this Act to
    achieve that minimization.
        (b) Consultation.--In making an emergency determination under
    subsection (a), the President shall, to the maximum extent practicable,
    consult with and take into account any advice received from--
                (1) the National Academy of Sciences;
                (2) the Secretary of Energy; and
                (3) the Administrator.
        (c) Judicial Review.--An emergency determination under subsection
    (a) shall be subject to judicial review in accordance with section 307
    of the Clean Air Act (42 U.S.C. 7607).

    SEC. 9002. ADMINISTRATIVE PROCEDURE AND JUDICIAL REVIEW.

        (a) Rulemaking Procedures.--Any rule, requirement, regulation,
    method, standard, program, determination, or final action made or
    promulgated pursuant to any title of this Act, with the exception of
    sections 3101, 3102, 3201, and 3901, shall be subject to the rulemaking
    procedures described in sections 551 through 557 of title 5, United
    States Code.
        (b) Enforcement.--Each provision of this Act (including provisions
    relating to mandatory duties of the Administrator) shall be fully
    enforceable pursuant to sections 113, 303, and 304 of the Clean Air Act
    (42 U.S.C. 7413, 7603, 7604).
        (c) Recordkeeping, Inspections, Monitoring, Entry, and Subpoenas.--
    The Administrator shall have the same powers and authority provided
    under sections 114 and 307(a) of the Clean Air Act (42 U.S.C. 7414,
    7607(a)) in carrying out, administering, and enforcing this Act.
        (d) Judicial Review.--A petition for judicial review of any
    regulation promulgated, or final action carried out, by the
    Administrator pursuant to this Act may be filed only--
                (1) in the United States Court of Appeals for the District
            of Columbia; and
                (2) in accordance with section 307(b) of the Clean Air Act
            (42 U.S.C. 7607(b)).

    SEC. 9003. RETENTION OF STATE AUTHORITY.

        (a) In General.--Except as provided in subsection (b), in
    accordance with section 116 of the Clean Air Act (42 U.S.C. 7416) and
    section 510 of the Federal Water Pollution Control Act (33 U.S.C.
    1370), nothing in this Act precludes or abrogates the right of any
    State to adopt or enforce--
                (1) any standard, cap, limitation, or prohibition relating
            to emissions of greenhouse gas; or
                (2) any requirement relating to control, abatement, or
            avoidance of emissions of greenhouse gas.
        (b) Exception.--Notwithstanding subsection (a), no State may adopt
    a standard, cap, limitation, prohibition, or requirement that is less
    stringent than the applicable standard, cap, limitation, prohibition,
    or requirement under this Act.

    SEC. 9004. TRIBAL AUTHORITY.

        For purposes of this Act, the Administrator may treat any federally
    recognized Indian tribe as a State, in accordance with section 301(d)
    of the Clean Air Act (42 U.S.C. 7601(d)).

    SEC. 9005. ROCKY MOUNTAIN CENTERS FOR STUDY OF COAL UTILIZATION.

        (a) Designation.--The University of Wyoming and Montana State
    University shall be known and designated as the ``Rocky Mountain
    Centers for the Study of Coal Utilization''.
        (b) Authorization of Appropriations.--There are authorized to be
    appropriated such sums as are necessary to carry out this section.

    SEC. 9006. SUN GRANT CENTER RESEARCH ON COMPLIANCE WITH CLEAN AIR ACT.

        (a) Designation.--Each sun grant center is designated as a research
    institution of the Environmental Protection Agency for the purpose of
    conducting studies regarding the effects of biofuels and biomass on
    national and regional compliance with the Clean Air Act (42 U.S.C. 7401
    et seq.).
        (b) Funding.--The Administrator shall provide to the sun grant
    centers such funds as the Administrator determines to be necessary to
    carry out studies described in subsection (a).
        (c) Authorization of Appropriations.--There are authorized to be
    appropriated such sums as are necessary to carry out this section.

    SEC. 9007. AUTHORIZATION OF APPROPRIATIONS.

        There are authorized to be appropriated such sums as are necessary
    to carry out this Act.

               TITLE X--CONTROL OF HYDROFLUOROCARBON CONSUMPTION

    SEC. 10001. APPLICABILITY.

        For purposes of this Act, it shall be unlawful for any person to
    produce or import for consumption in the United States any
    hydrofluorocarbon, or product or equipment containing a
    hydrofluorocarbon, except exclusively in accordance with this title and
    the regulations promulgated by the Administrator pursuant to this
    title.

    SEC. 10002. DEFINITIONS.

        In this title:
                (1) Baseline.--The term ``baseline'' means the global
            warming potential-weighted equivalent of 300,000,000 metric
            tons of carbon dioxide.
                (2) Entity; person.--The terms ``entity'' and ``person''
            have the meaning given the term ``person'' in section 551 of
            title 5, United States Code.
                (3) Global warming potential.--
                        (A) In general.--The term ``global warming
                    potential'' means the potential contribution to global
                    warming of a hydrofluorocarbon, as compared to the
                    potential contribution to global warming of an equal
                    weight of carbon dioxide.
                        (B) Calculation.--For the purposes of calculating
                    the global warming potential of a hydrofluorocarbon,
                    the values for the 100-year time horizon in the fourth
                    assessment report of the Intergovernmental Panel on
                    Climate Change shall be used.
                (4) Global warming potential-weighted.--The term ``global
            warming potential-weighted'', with respect to a
            hydrofluorocarbon, means the value equal to the product
            obtained, for purposes of determining the quantity of carbon
            dioxide with an equivalent global warming potential, by
            multiplying--
                        (A) a certain quantity of the hydrofluorocarbon;
                    and
                        (B) the global warming potential of the
                    hydrofluorocarbon.
                (5) Hydrochlorofluorocarbon.--The term
            ``hydrochlorofluorocarbon'' means any hydrochlorofluorocarbon
            identified in section 602(b) of the Clean Air Act (42 U.S.C.
            7671a(b)).
                (6) Hydrofluorocarbon.--The term ``hydrofluorocarbon''
            means a hydrofluoroalkane.
                (7) Hydrofluorocarbon consumption.--
                        (A) In general.--The term ``hydrofluorocarbon
                    consumption'', with respect to a hydrofluorocarbon,
                    means--
                                (i) in the case of a hydrofluorocarbon
                            producer, a value equal to the difference
                            between--
                                        (I) a value equal to the sum of--
                                                (aa) the quantity of the
                                            hydrofluorocarbon produced in
                                            the United States; and
                                                (bb) the quantity of the
                                            hydrofluorocarbon imported from
                                            any source into the United
                                            States or acquired in the
                                            United States from another
                                            hydrofluorocarbon producer
                                            through sale or other
                                            transaction; and
                                        (II) the quantity of the
                                    hydrofluorocarbon exported or
                                    transferred to another
                                    hydrofluorocarbon producer or importer
                                    in the United States through sale or
                                    other transaction; and
                                (ii) in the case of a hydrofluorocarbon
                            importer, a value equal to the difference
                            between--
                                        (I) the quantity of the
                                    hydrofluorocarbon imported from any
                                    source into the United States; and
                                        (II) the quantity of the
                                    hydrofluorocarbon exported.
                        (B) Exclusion.--The term ``hydrofluorocarbon
                    consumption'' does not include a quantity of
                    hydrofluorocarbon that is recycled.
                (8) Hydrofluorocarbon consumption allowance.--The term
            ``hydrofluorocarbon consumption allowance'' means an
            authorization--
                        (A) to produce or import a global warming
                    potential-weighted quantity of hydrofluorocarbon
                    equivalent to 1 metric ton of carbon dioxide; or
                        (B) to import products or equipment containing a
                    quantity of hydrofluorocarbon equivalent in global
                    warming potential to 1 metric ton of carbon dioxide.
                (9) Hydrofluorocarbon destruction.--The term
            ``hydrofluorocarbon destruction'' means a process that results
            in the permanent transformation or decomposition of all or a
            significant portion of a hydrofluorocarbon to another gas,
            liquid, or solid with a lower or zero global warming potential.
                (10) Hydrofluorocarbon destruction allowance.--The term
            ``hydrofluorocarbon destruction allowance'' means an
            authorization to produce or import a global warming potential-
            weighted quantity of hydrofluorocarbon equal to the global
            warming potential-weighted quantity of hydrofluorocarbon
            destroyed pursuant to section 10010.
                (11) Hydrofluorocarbon importer.--The term
            ``hydrofluorocarbon importer'' means an entity that imported
            hydrofluorocarbon or products or equipment containing
            hydrofluorocarbon into the United States during calendar year
            2005.
                (12) Hydrofluorocarbon producer.--The term
            ``hydrofluorocarbon producer'' means an entity that produced
            hydrofluorocarbon in the United States for sale in the United
            States during calendar year 2005.
                (13) Import.--The term ``import'' means the action of
            landing on or bringing or introducing a product into, or
            attempting to land on or bring or introduce a product into, any
            area subject to the jurisdiction of the United States,
            regardless of whether the action constitutes an importation
            within the meaning of the customs laws of the United States.
                (14) Produce; production.--
                        (A) In general.--The terms ``produce'' and
                    ``production'' mean the manufacture of a
                    hydrofluorocarbon from any raw material, feedstock, or
                    chemical.
                        (B) Exclusions.--The terms ``produce'' and
                    ``production'' do not include--
                                (i) the manufacture of a hydrofluorocarbon
                            that is used and entirely consumed (except for
                            trace quantities) in the manufacture of other
                            chemicals or products; or
                                (ii) the reuse or recycling of a
                            hydrofluorocarbon.
                (15) Recycle; reuse.--The terms ``reuse'' and ``recycle''
            mean--
                        (A) the removal of a quantity of hydrofluorocarbon
                    from a product or equipment;
                        (B) the reprocessing of the product or equipment to
                    remove impurities; and
                        (C) the offering of the product or equipment for
                    sale in the United States.

    SEC. 10003. CAP ON HYDROFLUOROCARBON CONSUMPTION AND IMPORTATION INTO
                  UNITED STATES.

        (a) Establishment.--The Administrator shall establish a cap on
    hydrofluorocarbon consumption in the United States for each calendar
    year during the period of calendar years 2010 through 2050, as directed
    in section 10004 that shall not be exceeded except as provided in
    section 10009.
        (b) Prohibition.--Consumption of a hydrofluorocarbon or products or
    equipment containing any hydrofluorocarbon, except as provided in this
    title, shall be illegal.

    SEC. 10004. HYDROFLUOROCARBON CONSUMPTION ALLOWANCE ACCOUNT.

        (a) Allowance Account.--
                (1) Establishment.--Not later than April 1, 2009, and
            annually thereafter through April 1, 2050, the Administrator
            shall establish and allocate a separate quantity of
            hydrofluorocarbon consumption allowances.
                (2) Denomination.--Hydrofluorocarbon consumption allowances
            shall be denominated in metric tons of carbon dioxide
            equivalent.
        (b) Identification Numbers.--The Administrator shall assign to each
    hydrofluorocarbon consumption allowance established under subsection
    (a) a unique identification number that includes the calendar year for
    which the hydrofluorocarbon consumption allowance was assigned.
        (c) Legal Status of Hydrofluorocarbon Consumption Allowances.--
                (1) In general.--A consumption allowance allocated under
            this title is a limited authorization to produce or import a
            hydrofluorocarbon and any product or equipment containing a
            hydrofluorocarbon, in accordance with this title.
                (2) Allowance not property right.--A hydrofluorocarbon
            consumption allowance does not constitute a property right.
                (3) Termination or limitation.--Nothing in this Act or any
            other provision of law limits the authority of the United
            States to terminate or limit hydrofluorocarbon consumption
            allowances.
                (4) Effect of act.--Nothing in this Act relating to
            hydrofluorocarbon consumption allowances shall affect the
            application of, or any requirement of compliance with, any
            other provision of law by any person.
        (d) Lifetime of Hydrofluorocarbon Consumption Allowances.--
    Hydrofluorocarbon consumption allowances distributed by the
    Administrator and hydrofluorocarbon destruction allowances may be used
    for compliance for a period of not more than 5 years after the calendar
    year for which the allowances are allocated.
        (e) Hydrofluorocarbon Consumption Allowances for Each Calendar
    Year.--The number of hydrofluorocarbon consumption allowances
    established and allocated by the Administrator for each of calendar
    years 2010 through 2050 shall be as follows:

    Calendar year                            HFC consumption allowances (in
                                              million metric tons)
      2010.................................  300
      2011.................................  294
      2012.................................  289
      2013.................................  283
      2014.................................  278
      2015.................................  272
      2016.................................  267
      2017.................................  261
      2018.................................  256
      2019.................................  250
      2020.................................  245
      2021.................................  239
      2022.................................  234
      2023.................................  228
      2024.................................  222
      2025.................................  217
      2026.................................  206
      2027.................................  195
      2028.................................  184
      2029.................................  173
      2030.................................  162
      2031.................................  150
      2032.................................  139
      2033.................................  128
      2034.................................  117
      2035.................................  106
      2036.................................  95
      2037.................................  90
      2038.................................  90
      2039.................................  90
      2040.................................  90
      2041.................................  90
      2042.................................  90
      2043.................................  90
      2044.................................  90
      2045.................................  90
      2046.................................  90
      2047.................................  90
      2048.................................  90
      2049.................................  90
      2050.................................  90

    SEC. 10005. ALLOCATION OF HYDROFLUOROCARBON CONSUMPTION ALLOWANCES.

        (a) In General.--Not later than 90 days before the beginning of
    each applicable calendar year, the Administrator shall allocate the
    portion of the hydrofluorocarbon consumption allowances in the
    hydrofluorocarbon consumption allowance account that is available for
    allocation for that calendar year.
        (b) Eligible Entities.--
                (1) In general.--The Administrator shall allocate
            hydrofluorocarbon consumption allowances as described in
            paragraph (2) to entities that--
                        (A) were hydrofluorocarbon producers or
                    hydrofluorocarbon importers during the period beginning
                    on January 1, 2004, and ending on December 31, 2006;
                    and
                        (B) are hydrofluorocarbon producers or
                    hydrofluorocarbon importers on the date of enactment of
                    this Act.
                (2) Description of allocation.--Hydrofluorocarbon
            consumption allowances shall be allocated to entities described
            in paragraph (1) as follows:
                        (A) Hydrofluorocarbon producers.--Each
                    hydrofluorocarbon producer shall receive a quantity of
                    hydrofluorocarbon allowances equal to the ratio that--
                                (i) a value equal to the difference
                            between--
                                        (I) the global warming potential-
                                    weighted average of 100 percent of the
                                    hydrofluorocarbon and 60 percent of the
                                    hydrochlorofluorocarbon produced in the
                                    United States, imported into the United
                                    States, or acquired in the United
                                    States by the hydrofluorocarbon
                                    producer during the period beginning on
                                    January 1, 2004, and ending on December
                                    31, 2006; and
                                        (II) the global warming potential-
                                    weighted average of 100 percent of the
                                    hydrofluorocarbon and 60 percent of the
                                    hydrochlorofluorocarbon that the
                                    producer exported or transferred to
                                    another producer of hydrofluorocarbons
                                    in the United States during the period
                                    described in subclause (I); bears to
                                (ii) a value equal to the difference
                            between--
                                        (I) the total global warming
                                    potential-weighted average of 100
                                    percent of the hydrofluorocarbon and 60
                                    per cent of the hydrochlorofluorocarbon
                                    produced in or imported into the United
                                    States during the period described in
                                    clause (i)(I); and
                                        (II) the global warming potential-
                                    weighted average of 100 percent of the
                                    hydrofluorocarbon and 60 per cent of
                                    the hydrochlorofluorocarbon exported
                                    from the United States during that
                                    period.
                        (B) Hydrofluorocarbon importers.--Each
                    hydrofluorocarbon importer shall receive a quantity of
                    hydrofluorocarbon allowances equal to the ratio that--
                                (i) the global warming potential-weighted
                            average of 100 percent of hydrofluorocarbon and
                            60 percent of hydrochlorofluorocarbon imported
                            by the hydrofluorocarbon importer as a product
                            or contained in equipment during the period
                            beginning on January 1, 2004, and ending on
                            December 31, 2006; bears to
                                (ii) a value equal to the difference
                            between--
                                        (I) the total global warming
                                    potential-weighted average of 100
                                    percent of the hydrofluorocarbon and 60
                                    per cent of the hydrochlorofluorocarbon
                                    produced in and imported into the
                                    United States during the period
                                    described in clause (i); and
                                        (II) the global warming potential-
                                    weighted average of 100 percent of the
                                    hydrofluorocarbon and 60 per cent of
                                    the hydrochlorofluorocarbon exported
                                    from the United States during that
                                    period.
        (c) Withholding Allowances.--
                (1) In general.--For calendar year 2010 and each calendar
            year thereafter, the Administrator shall withhold a quantity of
            hydrofluorocarbon consumption allowances that would otherwise
            be allocated under subsection (b) for auction at least annually
            by the Corporation to the entities identified in subsection
            (b)(1).
                (2) Auctions by corporation.--For each applicable calendar
            year, the Administrator shall withhold, and the Corporation
            shall auction to the entities identified in subsection (b)(1),
            the following quantities of the hydrofluorocarbon consumption
            allowances established under section 10004:

    Calendar year                            Percent withheld for auction
      2010.................................  5
      2011.................................  10
      2012.................................  10
      2013.................................  10
      2014.................................  15
      2015.................................  20
      2016.................................  25
      2017.................................  30
      2018.................................  35
      2019.................................  40
      2020.................................  45
      2021.................................  50
      2022.................................  55
      2023.................................  60
      2024.................................  65
      2025.................................  70
      2026.................................  75
      2027.................................  80
      2028.................................  85
      2029.................................  90
      2030.................................  95
      2031.................................  100
      2032.................................  100
      2033.................................  100
      2034.................................  100
      2035.................................  100
      2036.................................  100
      2037.................................  100
      2038.................................  100
      2039.................................  100
      2040.................................  100
      2041.................................  100
      2042.................................  100
      2043.................................  100
      2044.................................  100
      2045.................................  100
      2046.................................  100
      2047.................................  100
      2048.................................  100
      2049.................................  100
      2050.................................  100

                (3) Proceeds.--The Corporation shall award the proceeds of
            the auction to support the following purposes:
                        (A) A program to recover and destroy the maximum
                    economically recoverable chlorofluorocarbons, halons,
                    and other substances listed under title VI of the Clean
                    Air Act (42 U.S.C. 7671 et seq.) that have significant
                    ozone depletion potential and global warming potential.
                        (B) A program of incentives for consumer purchases
                    of refrigeration and cooling equipment that--
                                (i) contains refrigerants with no or low
                            global warming potential; and
                                (ii) achieves energy efficiency that
                            represents at least a 30 percent improvement,
                            as compared to the more efficient of--
                                        (I) the applicable Federal energy
                                    efficiency standard; and
                                        (II) the applicable Energy Star
                                    rating.
                        (C) A program to support the development and
                    deployment of--
                                (i) hydrofluorocarbons with low global
                            warming potential; and
                                (ii) energy efficient technologies,
                            equipment, and products containing or using
                            hydrofluorocarbons.
                        (D) The programs receiving auction proceeds under
                    title IV.

    SEC. 10006. COMPLIANCE OBLIGATION.

        (a) Submission of Allowances.--
                (1) In general.--Not later than 90 days after the end of
            each applicable calendar year, a hydrofluorocarbon producer or
            hydrofluorocarbon importer shall submit to the Administrator a
            quantity of hydrofluorocarbon consumption allowances, or
            hydrofluorocarbon destruction allowances awarded pursuant to
            section 10010, equal to the total number of global warming
            potential-weighted tons of hydrofluorocarbon consumed in the
            United States during the preceding calendar year by the
            hydrofluorocarbon producer or hydrofluorocarbon importer, as
            determined in accordance with paragraphs (2) and (3).
                (2) Hydrofluorocarbon producers.--For hydrofluorocarbon
            producers, the quantity of hydrofluorocarbon consumed shall be
            a value equal to the difference between--
                        (A) the global warming potential-weighted tons of
                    hydrofluorocarbon produced in the United States,
                    imported as a product, or acquired in the United States
                    from another hydrofluorocarbon producer through sale or
                    other transaction; and
                        (B) the global warming potential-weighted tons of
                    hydrofluorocarbon the producer exported or transferred
                    to another hydrofluorocarbon producer in the United
                    States through sale or other transaction.
                (3) Hydrofluorocarbon importers.--For hydrofluorocarbon
            importers, hydrofluorocarbon consumed shall be a value equal to
            the global warming potential-weighted tons of hydrofluorocarbon
            imported by the hydrofluorocarbon importer as a product or
            contained in equipment, or acquired in the United States from a
            hydrofluorocarbon producer through sale or other transaction.
        (b) Retirement.--Immediately on receipt of a hydrofluorocarbon
    consumption allowance or a hydrofluorocarbon destruction allowance
    under subsection (a), the Administrator shall retire the allowance.
        (c) Determination of Compliance.--Not later than July 1 of each
    year, the Administrator shall--
                (1) determine whether each hydrofluorocarbon producer and
            hydrofluorocarbon importer achieved compliance with subsection
            (a) for the preceding year; and
                (2) so notify each hydrofluorocarbon producer and
            hydrofluorocarbon importer.
        (d) Penalties.--A hydrofluorocarbon producer or hydrofluorocarbon
    importer that is not in compliance with subsection (a), as determined
    under subsection (c), shall be liable for the payment of an excess
    consumption penalty as provided in section 1203, except that the
    deadlines described in this title shall be substituted for the
    deadlines described in that section.

    SEC. 10007. SALE, EXCHANGE, AND OTHER USES OF HYDROFLUOROCARBON
                  CONSUMPTION ALLOWANCES.

        (a) Permissible Uses.--
                (1) In general.--A hydrofluorocarbon producer or
            hydrofluorocarbon importer may purchase, hold, sell, exchange,
            transfer, submit for compliance in accordance with section
            10006, or retire hydrofluorocarbon consumption allowances or
            hydrofluorocarbon destruction allowances.
                (2) Action on retirement.--If any hydrofluorocarbon
            producer or hydrofluorocarbon importer permanently retires a
            hydrofluorocarbon consumption allowance, the Administrator
            shall promptly redistribute the allowance to another
            hydrofluorocarbon producer or hydrofluorocarbon importer
            pursuant to section 10005(b).
        (b) Prohibitions.--
                (1) In general.--Hydrofluorocarbon consumption allowances
            or hydrofluorocarbon destruction allowances shall not be traded
            or exchanged with allowances associated with any other emission
            allowance allocation or trading program under this Act.
                (2) Certain uses.--Hydrofluorocarbon consumption allowances
            shall not be used to achieve compliance with any other
            obligation relating to emissions of greenhouse gases regulated
            under any other provision of this Act, and emission allowances
            established and allocated under any other provision of this Act
            shall not be used to achieve compliance with this title.
        (c) Limitation.--The privilege of purchasing, holding, selling,
    exchanging, transferring, and submitting for compliance in accordance
    with section 10006, and retiring hydrofluorocarbon consumption
    allowances or hydrofluorocarbon destruction allowances shall be
    restricted to entities described in section 10005(b)(1).

    SEC. 10008. ALLOWANCE TRANSFER SYSTEM.

        (a) Regulations.--Not later than 18 months after the date of
    enactment of this Act, the Administrator shall promulgate regulations
    to carry out the provisions of this title relating to hydrofluorocarbon
    consumption allowances and hydrofluorocarbon destruction allowances,
    including regulations providing that the transfer of those allowances
    shall not be effective until the date on which a written certification
    of the transfer, signed by a responsible official of each party to the
    transfer, is received and recorded by the Administrator in accordance
    with those regulations.
        (b) Transfers.--
                (1) In general.--The regulations promulgated under
            subsection (a) shall permit the transfer of hydrofluorocarbon
            consumption allowances prior to the allocation of the
            allowances.
                (2) Deduction and addition of transfers.--A recorded
            preallocation transfer of hydrofluorocarbon consumption
            allowances shall be--
                        (A) deducted by the Administrator from the number
                    of hydrofluorocarbon consumption allowances that would
                    otherwise be allocated to the transferor; and
                        (B) added to those hydrofluorocarbon consumption
                    allowances allocated to the transferee.
        (c) Issuance, Recording, and Tracking System.--The regulations
    promulgated under subsection (a) shall include a system for issuing,
    recording, and tracking hydrofluorocarbon consumption and
    hydrofluorocarbon destruction allowances that shall specify all
    necessary procedures and requirements for an orderly and competitive
    functioning of the hydrofluorocarbon consumption allowance system.

    SEC. 10009. BANKING AND BORROWING.

        (a) Banking.--A hydrofluorocarbon producer or hydrofluorocarbon
    importer that submits hydrofluorocarbon consumption allowances or
    hydrofluorocarbon destruction allowances to the Administrator to
    achieve compliance with section 10006 shall indicate in the
    identification number of the hydrofluorocarbon consumption allowance or
    hydrofluorocarbon destruction allowance the calendar year for which the
    allowance is submitted.
        (b) Borrowing of Hydrofluorocarbon Consumption Allowances.--In
    accordance with the regulations promulgated under section 10008(a), and
    subject to subsection (d), a hydrofluorocarbon producer or
    hydrofluorocarbon importer may--
                (1) borrow hydrofluorocarbon consumption allowances from
            the Administrator; and
                (2) for a calendar year, submit borrowed hydrofluorocarbon
            consumption allowances to the Administrator to satisfy not more
            than 15 percent of the compliance obligation under section
            10006.
        (c) Limitation on Borrowing.--A hydrofluorocarbon consumption
    allowance borrowed under subsection (b) shall be a hydrofluorocarbon
    consumption allowance established by the Administrator for a specific
    subsequent calendar year under section 10004(g).
        (d) Term.--A producer or importer shall not submit, and the
    Administrator shall not accept, a borrowed hydrofluorocarbon
    consumption allowance in partial satisfaction of the compliance
    obligation under section 10006 for any calendar year that is more than
    5 years before the calendar year included in the identification number
    of the borrowed hydrofluorocarbon consumption allowance.
        (e) Repayment of Interest.--For any borrowed hydrofluorocarbon
    consumption allowance submitted in partial satisfaction of the
    compliance obligation under section 10006 for a particular calendar
    year (referred to in this subsection as the ``use year''), the number
    of hydrofluorocarbon consumption allowances or hydrofluorocarbon
    destruction allowances that the hydrofluorocarbon producer or
    hydrofluorocarbon importer is required to submit under section 10006
    for the year from which the borrowed hydrofluorocarbon consumption
    allowance was taken (referred to in this subsection as the ``source
    year'') shall be increased by an amount equal to the product obtained
    by multiplying--
                (1) 1.1; and
                (2) the number of calendar years beginning after the use
            year but before the source year.

    SEC. 10010. HYDROFLUOROCARBON DESTRUCTION ALLOWANCES.

        (a) Destruction of Hydrofluorocarbon.--
                (1) In general.--The Administrator shall issue
            hydrofluorocarbon destruction allowances to any
            hydrofluorocarbon producer or hydrofluorocarbon importer that
            performs or arranges for recovery and destruction of
            hydrofluorocarbon from products or equipment.
                (2) Issuance and denomination.--Hydrofluorocarbon
            destruction allowances shall be issued on a global warming
            potential-weighted basis, denominated in terms of metric tons
            of carbon dioxide.
                (3) Limitations.--
                        (A) Byproducts.--No hydrofluorocarbon destruction
                    allowance shall be issued under this section for
                    destruction of hydrofluorocarbon produced as a
                    byproduct in a production process.
                        (B) Certain purposes.--No hydrofluorocarbon
                    destruction allowance shall be issued under this
                    section for destruction or recycling of
                    hydrofluorocarbon produced for a purpose other than the
                    ultimate sale and use of the product.
        (b) Regulations.--
                (1) Requirement.--The regulations promulgated under section
            10008(a) shall authorize the issuance of hydrofluorocarbon
            destruction allowances.
                (2) Criteria.--Those regulations shall establish
            appropriate criteria for determining--
                        (A) the effectiveness of destruction;
                        (B) the net quantity of global warming potential-
                    weighted hydrofluorocarbon that has been destroyed; and
                        (C) procedures for verification, registration, and
                    issuance of hydrofluorocarbon destruction allowances.
        (c) Satisfaction of Requirements.--Beginning with calendar year
    2012, a hydrofluorocarbon producer or hydrofluorocarbon importer may
    satisfy a portion of the hydrofluorocarbon consumption allowance
    submission requirement under section 10006 by submitting
    hydrofluorocarbon destruction allowances generated in accordance with
    the regulations promulgated pursuant to section 10008(a).
        (d) Ownership.--Initial ownership of a hydrofluorocarbon
    destruction allowance shall be held by the hydrofluorocarbon producer
    or hydrofluorocarbon importer that performs or arranges for recovery
    and destruction or recycling of hydrofluorocarbon, including
    hydrofluorocarbon from products or equipment containing
    hydrofluorocarbon, unless otherwise specified in a legally binding
    contract or agreement to which the hydrofluorocarbon producer or
    hydrofluorocarbon importer is a party.
        (e) Transferability.--A hydrofluorocarbon destruction allowance
    generated pursuant to the regulations promulgated pursuant to
    subsection (b)--
                (1) may be sold, traded, or transferred to any
            hydrofluorocarbon producer or hydrofluorocarbon importer
            referred to in section 10005(b); but
                (2) shall not be sold, traded, transferred, or used for
            compliance with any other emission allowance requirement of
            this Act or any other law.

                     TITLE XI--AMENDMENTS TO CLEAN AIR ACT

    SEC. 11001. NATIONAL RECYCLING AND EMISSION REDUCTION PROGRAM.

        Section 608 of the Clean Air Act (42 U.S.C. 7671g) is amended--
                (1) by redesignating subsections (a) through (c) as
            subsections (b) through (d), respectively;
                (2) by inserting before subsection (b) (as so redesignated)
            the following:
        ``(a) Definition of Hydrofluorocarbon Substitute.--In this section,
    the term `hydrofluorocarbon substitute' means a hydrofluorocarbon--
                ``(1) with a global warming potential of more than 150; and
                ``(2) that is used in or for types of equipment,
            appliances, or processes that previously relied on class I or
            class II substances.'';
                (3) in subsection (b) (as so redesignated)--
                        (A) in the matter following paragraph (3), by
                    striking ``Such regulations'' and inserting the
                    following:
                ``(5) The regulations'';
                        (B) by redesignating paragraph (3) as paragraph
                    (4); and
                        (C) by inserting after paragraph (2) the following:
                ``(3)(A) Not later than 1 year after the date of enactment
            of the Lieberman-Warner Climate Security Act of 2007, the
            Administrator shall promulgate regulations establishing
            standards and requirements regarding the sale or distribution,
            or offer for sale and distribution in interstate commerce, use,
            and disposal of hydrofluorocarbon substitutes for class I and
            class II substances not covered by paragraph (1), including the
            use, recycling, and disposal of those hydrofluorocarbon
            substitutes during the maintenance, service, repair, or
            disposal of appliances and industrial process refrigeration
            equipment.
                ``(B) The standards and requirements established under
            subparagraph (A) shall take effect not later than 1 year after
            the date of promulgation of the regulations.'';
                (4) in subsection (c) (as so redesignated)--
                        (A) by redesignating paragraphs (1) through (3) as
                    subparagraphs (A) through (C), respectively, and
                    indenting the subparagraphs appropriately;
                        (B) by striking the subsection designation and
                    heading and all that follows through ``following--''
                    and inserting the following:
        ``(c) Safe Disposal.--The regulations under subsection (b) shall--
                ``(1) establish standards and requirements for the safe
            disposal of class I and II substances and hydrofluorocarbon
            substitutes for those substances; and
                ``(2) include each of the following:'';
                        (C) in subparagraph (A) (as redesignated by
                    subparagraph (A)), by inserting ``(or hydrofluorocarbon
                    substitutes for those substances)'' after ``class I or
                    class II substances''; and
                        (D) in paragraphs (2) and (3), by inserting ``(or a
                    hydrofluorocarbon substitutes for such a substance)''
                    after ``class I or class II substance'' each place it
                    appears.

    SEC. 11002. SERVICING OF MOTOR VEHICLE AIR CONDITIONERS.

        Section 609 of the Clean Air Act (42 U.S.C. 7671h) is amended--
                (1) in subsection (b), by adding at the end the following:
                ``(5) The term `hydrofluorocarbon substitute' means a
            hydrofluorocarbon--
                        ``(A) with a global warming potential of more than
                    150; and
                        ``(B) that is used in or for types of equipment,
                    appliances, or processes that previously relied on
                    class I or class II substances.''; and
                (2) in subsection (e)--
                        (A) by striking the subsection designation and
                    heading and all that follows through ``Effective'' and
                    inserting the following:
        ``(e) Small Containers of Class I or Class II Substances and
    Hydrofluorocarbon Substitutes.--
                ``(1) Class i or class ii substances.--Effective
            beginning''; and
                        (B) by adding at the end the following:
                ``(2) Hydrofluorocarbon substitutes.--Effective beginning
            January 1, 2010, it shall be unlawful for any person to sell or
            distribute, or offer for sale or distribution, in interstate
            commerce to any person (other than a person performing service
            for consideration on motor vehicle air-conditioning systems in
            compliance with this section) any hydrofluorocarbon substitute
            that is--
                        ``(A) suitable for use in a motor vehicle air-
                    conditioning system; and
                        ``(B) in a container that contains less than 20
                    pounds of the hydrofluorocarbon substitute.''.

    SEC. 11003. CARBON DIOXIDE REDUCTION.

        (a) Findings.--Congress finds that--
                (1) oil used for transportation contributes significantly
            to air pollution, including global warming pollution, water
            pollution, and other adverse impacts on the environment;
                (2) to reduce emissions of global warming pollutants, the
            United States should increasingly rely on advanced clean fuels
            for transportation; and
                (3) a comparison of life-cycle greenhouse gas emissions of
            conventional transportation fuels and low-carbon transportation
            fuels should be based on comparable fuels, such as a comparison
            of gasoline to gasoline and diesel fuel to diesel fuel.
        (b) Definitions.--Section 211(o)(1) of the Clean Air Act (42 U.S.C.
    7545(o)(1)) is amended--
                (1) by redesignating subparagraphs (B), (C), and (D) as
            subparagraphs (J), (G), and (H), respectively, and moving those
            subparagraphs so as to appear in alphabetical order;
                (2) by inserting after subparagraph (A) the following:
                        ``(B) Cultivated noxious plant.--The term
                    `cultivated noxious plant' means a plant that is
                    included on--
                                ``(i) the Federal noxious weed list
                            maintained by the Animal and Plant Health
                            Inspection Service; or
                                ``(ii) any equivalent State list.
                        ``(C) Fuel emission baseline.--The term `fuel
                    emission baseline' means the average lifecycle
                    greenhouse gas emissions per unit of energy of
                    conventional transportation fuels in commerce in the
                    United States in calendar year 2008, as determined by
                    the Administrator under paragraph (11).
                        ``(D) Fuel provider.--
                                ``(i) In general.--The term `fuel provider'
                            means an obligated party (as described in
                            section 80.1106 of title 40, Code of Federal
                            Regulations (or a successor regulation)).
                                ``(ii) Inclusions.--The term `fuel
                            provider' includes, as the Administrator
                            determines to be appropriate, an individual or
                            entity that produces, blends, or imports
                            gasoline or any other transportation fuel in
                            commerce in, or into, the United States.
                        ``(E) Greenhouse gas.--The term `greenhouse gas'
                    means any of--
                                ``(i) carbon dioxide;
                                ``(ii) methane;
                                ``(iii) nitrous oxide;
                                ``(iv) hydrofluorocarbons;
                                ``(v) perfluorocarbons;
                                ``(vi) sulfur hexafluoride; and
                                ``(vii) any other emission or effect (such
                            as particulate matter or a change in albedo)
                            that the Administrator determines to be a
                            significant factor in global warming as a
                            result of the use of transportation fuel.
                        ``(F) Lifecycle greenhouse gas emissions.--
                                ``(i) In general.--The term `lifecycle
                            greenhouse gas emissions' means, with respect
                            to a transportation fuel, the aggregate
                            quantity of greenhouse gases emitted per
                            British thermal unit of fuel, as determined by
                            the Administrator, from production through use
                            of the fuel, as calculated to ensure that any
                            nonrecurring emission is not amortized over a
                            period of more than 20 years to ensure that
                            required improvements in greenhouse gas
                            emissions occur within that period.
                                ``(ii) Inclusions.--The term `lifecycle
                            greenhouse gas emissions' includes emissions
                            associated with--
                                        ``(I) feedstock production
                                    (including direct and indirect land-use
                                    changes) or extraction;
                                        ``(II) feedstock refining;
                                        ``(III) distribution of a fuel; and
                                        ``(IV) use of a fuel.''; and
                (3) by inserting after subparagraph (H) (as redesignated by
            paragraph (1)) the following:
                        ``(I) Transportation fuel.--The term
                    `transportation fuel' means fuel used to power motor
                    vehicles, nonroad engines, or aircraft.''.
        (c)  Advanced Clean Fuel Program.--Section 211(o) of the Clean Air
    Act (42 U.S.C. 7545(o)) is amended by adding at the end the following:
                ``(11) Advanced clean fuel performance standard.--
                        ``(A) Standard.--
                                ``(i) In general.--Not later than January
                            1, 2010, the Administrator shall, by
                            regulation--
                                        ``(I) establish a methodology for
                                    use in determining the lifecycle
                                    greenhouse gas emissions of all
                                    transportation fuels in commerce;
                                        ``(II) determine the fuel emission
                                    baseline;
                                        ``(III) establish a transportation
                                    fuel certification and marketing
                                    process to determine the lifecycle
                                    greenhouse gas emissions of
                                    conventional transportation fuels and
                                    renewable fuels being sold or
                                    introduced into commerce in the United
                                    States that allows--
                                                ``(aa) for a simple
                                            certification using default
                                            values; and
                                                ``(bb) fuel providers to
                                            opt in to the use of a
                                            standardized certification tool
                                            that would provide verifiable
                                            and auditable greenhouse gas
                                            ratings for fuels of the
                                            providers through the use of
                                            additional, certified data;
                                        ``(IV) in accordance with clause
                                    (ii), establish a requirement
                                    applicable to each fuel provider to
                                    reduce the average lifecycle greenhouse
                                    gas emissions per unit of energy of the
                                    aggregate quantity of transportation
                                    fuel produced, blended, or imported by
                                    the fuel provider to a level that is,
                                    to the maximum extent practicable--
                                                ``(aa) by not later than
                                            calendar year 2011, at least
                                            equal to or less than the fuel
                                            emission baseline;
                                                ``(bb) by not later than
                                            calendar year 2015, 5 percent
                                            less than the fuel emission
                                            baseline; and
                                                ``(cc) by not later than
                                            calendar year 2020, 10 percent
                                            less than the fuel emission
                                            baseline; and
                                        ``(V) permit alternative reliable
                                    estimation methods to be used for the
                                    purpose of this clause during the first
                                    5 years that the requirement described
                                    in subclause (IV) is in effect.
                                ``(ii) Air quality impacts.--For the
                            purpose of this subparagraph, in the case of
                            any air quality-related adverse lifecycle
                            impact resulting from emissions from motor
                            vehicles using renewable fuel, the
                            Administrator shall ensure, by regulation
                            promulgated under this title, that gasoline
                            containing renewable fuel does not result in--
                                        ``(I) average per-gallon motor
                                    vehicle emissions (measured on a mass
                                    basis) of air pollutants in excess of
                                    those emissions attributable to
                                    gasoline sold or introduced into
                                    commerce in the United States in
                                    calendar year 2007; or
                                        ``(II) a violation of any motor
                                    vehicle emission or fuel content
                                    limitation under any other provision of
                                    this Act.
                                ``(iii) Calendar year 2025 and
                            thereafter.--For calendar year 2025, and each
                            fifth calendar year thereafter, the
                            Administrator, in consultation with the
                            Secretary of Agriculture and the Secretary of
                            Energy, shall revise the applicable performance
                            standard to require that each fuel provider
                            shall additionally reduce, to the maximum
                            extent practicable, the average lifecycle
                            greenhouse gas emissions per unit of energy of
                            the aggregate quantity of transportation fuel
                            introduced by the fuel provider into commerce
                            in the United States.
                                ``(iv) Revision of regulations.--In
                            accordance with the purposes of the Lieberman-
                            Warner Climate Security Act of 2007, the
                            Administrator may, as appropriate, revise the
                            regulations promulgated under clause (i) as
                            necessary to reflect or respond to changes in
                            the transportation fuel market or other
                            relevant circumstances.
                                ``(v) Method of calculation.--In
                            calculating the lifecycle greenhouse gas
                            emissions of hydrogen or electricity (when used
                            as a transportation fuel) pursuant to clause
                            (i)(I), the Administrator shall--
                                        ``(I) include emissions resulting
                                    from the production of the hydrogen or
                                    electricity; and
                                        ``(II) consider to be equivalent to
                                    the energy delivered by 1 gallon of
                                    ethanol the energy delivered by--
                                                ``(aa) 6.4 kilowatt-hours
                                            of electricity;
                                                ``(bb) 132 standard cubic
                                            feet of hydrogen; or
                                                ``(cc) 1.25 gallons of
                                            liquid hydrogen.
                                ``(vi) Best available science.--In carrying
                            out this paragraph, the Administrator shall use
                            the best available scientific and technical
                            information to determine the lifecycle
                            greenhouse gas emissions of transportation
                            fuels derived from--
                                        ``(I) planted crops and crop
                                    residue produced and harvested from
                                    agricultural land that--
                                                ``(aa) has been cleared
                                            and, if the land was previously
                                            wetland, drained before the
                                            date of enactment of this
                                            paragraph, and that is actively
                                            managed or fallow and
                                            nonforested; and
                                                ``(bb) is in compliance
                                            with a conservation plan that
                                            meets the standards,
                                            guidelines, and restrictions
                                            under subtitles B and C of
                                            chapter 1 of subtitle D of
                                            title XII of the Food Security
                                            Act of 1985 (16 U.S.C. 3831 et
                                            seq.);
                                        ``(II) planted trees and tree
                                    residue from actively-managed tree
                                    plantations on non-Federal land that
                                    has been cleared and, if the land was
                                    previously wetland, drained before the
                                    date of enactment of this paragraph;
                                        ``(III) animal waste material, and
                                    animal byproducts;
                                        ``(IV) slash and pre-commercial
                                    thinnings from non-Federal forestland
                                    other than--
                                                ``(aa) old-growth forest or
                                            late successional forest; and
                                                ``(bb) ecological
                                            communities with a global or
                                            State ranking of critically
                                            imperiled, imperiled, or rare
                                            pursuant to a State natural
                                            heritage program;
                                        ``(V) biomass obtained from the
                                    immediate vicinity of buildings and
                                    other areas regularly occupied by
                                    individuals, or of public
                                    infrastructure, that is at risk from
                                    wildfire;
                                        ``(VI) algae;
                                        ``(VII) separated food waste or
                                    yard waste;
                                        ``(VIII) electricity, including the
                                    entire lifecycle of the fuel;
                                        ``(IX) 1 or more fossil fuels,
                                    including the entire lifecycle of the
                                    fuels; and
                                        ``(X) hydrogen, including the
                                    entire lifecycle of the fuel.
                                ``(vii) Equivalent emissions.--In carrying
                            out this paragraph, the Administrator shall
                            consider transportation fuel derived from
                            cultivated noxious plants, and transportation
                            fuel derived from biomass sources other than
                            those sources described in clause (vi), to have
                            emissions equivalent to the greater of--
                                        ``(I) the lifecycle greenhouse gas
                                    emissions; or
                                        ``(II) the fuel emission baseline.
                        ``(B) Election to participate.--An electricity
                    provider may elect to participate in the program under
                    this section if the electricity provider provides and
                    separately tracks electricity for transportation
                    through a meter that--
                                ``(i) measures the electricity used for
                            transportation separately from electricity used
                            for other purposes; and
                                ``(ii) allows for load management and time-
                            of-use rates.
                        ``(C) Credits.--
                                ``(i) In general.--The regulations
                            promulgated to carry out this paragraph shall
                            permit fuel providers to receive credits for
                            achieving, during a calendar year, greater
                            reductions in lifecycle greenhouse gas
                            emissions of the fuel provided, blended, or
                            imported by the fuel provider than are required
                            under subparagraph (A)(i)(IV).
                                ``(ii) Method of calculation.--The number
                            of credits received by a fuel provider as
                            described clause (i) for a calendar year shall
                            be calculated by multiplying--
                                        ``(I) the aggregate quantity of
                                    fuel produced, distributed, or imported
                                    by the fuel provider in the calendar
                                    year; and
                                        ``(II) the difference between--
                                                ``(aa) the lifecycle
                                            greenhouse gas emissions of
                                            that quantity of fuel; and
                                                ``(bb) the maximum
                                            lifecycle greenhouse gas
                                            emissions of that quantity of
                                            fuel permitted for the calendar
                                            year under subparagraph
                                            (A)(i)(IV).
                        ``(D) Compliance.--
                                ``(i) In general.--Each fuel provider
                            subject to this paragraph shall demonstrate
                            compliance with this paragraph, including, as
                            necessary, through the use of credits banked or
                            purchased.
                                ``(ii) No limitation on trading or
                            banking.--There shall be no limit on the
                            ability of any fuel provider to trade or bank
                            credits pursuant to this subparagraph.
                                ``(iii) Use of banked credits.--A fuel
                            provider may use banked credits under this
                            subparagraph with no discount or other
                            adjustment to the credits.
                                ``(iv) Borrowing.--A fuel provider may not
                            borrow credits from future years for use under
                            this subparagraph.
                                ``(v) Types of credits.--To encourage
                            innovation in transportation fuels--
                                        ``(I) only credits created in the
                                    production of transportation fuels may
                                    be used for the purpose of compliance
                                    described in clause (i); and
                                        ``(II) credits created by or in
                                    other sectors, such as manufacturing,
                                    may not be used for that purpose.
                        ``(E) No effect on state authority or more
                    stringent requirements.--Nothing in this subsection--
                                ``(i) affects the authority of a State to
                            establish, or to maintain in effect, any
                            transportation fuel performance standard or
                            other similar standard that is more stringent
                            than a standard established under this
                            paragraph; or
                                ``(ii) supercedes or otherwise affects any
                            more stringent requirement under any other
                            provision of this Act.''.
        (d) Water Quality Protection.--Section 211(c)(1) of the Clean Air
    Act (42 U.S.C. 7545(c)(1)) is amended--
                (1) by striking ``nonroad vehicle (A) if in the judgment of
            the Administrator'' and inserting the following: ``nonroad
            vehicle--
                        ``(A) if, in the judgment of the Administrator, any
                    fuel or fuel additive or'';
                (2) by striking ``, or (B) if'' and inserting the
            following: ``; or
                        ``(B) if''; and
                (3) in subparagraph (A), by striking ``air pollution
            which'' and inserting ``air pollution or water pollution
            (including any degradation in the quality of groundwater)
            that''.
                                                           Calendar No. 740

    110th CONGRESS

      2d Session

                                    S. 2191

                              [Report No. 110-337]

    _______________________________________________________________________

                                     A BILL

     To direct the Administrator of the Environmental Protection Agency to
    establish a program to decrease emissions of greenhouse gases, and for
                                other purposes.

    _______________________________________________________________________

                                  May 20, 2008

                           Reported with an amendment