[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 3523 Introduced in Senate (IS)]







110th CONGRESS
  2d Session
                                S. 3523

   To provide 8 steps for energy sufficiency, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

           September 18 (legislative day, September 17), 2008

   Mr. Enzi introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
   To provide 8 steps for energy sufficiency, and for other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Eight Steps to 
Energy Sufficiency Act of 2008''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
                    TITLE I--SAVING AMERICAN ENERGY

                 Subtitle A--Plug in Hybrid Technology

Sec. 101. Advanced batteries for electric drive vehicles.
                Subtitle B--Promoting Energy Efficiency

Sec. 111. Expanding information on energy savings techniques.
              TITLE II--INCREASING AMERICAN ENERGY SUPPLY

                  Subtitle A--Outer Continental Shelf

Sec. 201. Publication of projected State lines on outer continental 
                            shelf.
Sec. 202. Production of oil and natural gas in new producing areas.
Sec. 203. Conforming amendments.
                   Subtitle B--Oil Shale Development

Sec. 211. Removal of prohibition on final regulations for commercial 
                            leasing program for oil shale resources on 
                            public land.
                    TITLE III--STREAMLINE PERMITTING

           Subtitle A--Streamline Refinery Permitting Process

Sec. 301. Refinery permitting process.
        Subtitle B--Application for Permit to Drill Fee Removal

Sec. 311. Removal of additional fee for new applications for permits to 
                            drill.
    Subtitle C--Report on National Environmental Policy Act of 1969

Sec. 321. Report on National Environmental Policy Act of 1969.
                          TITLE IV--INNOVATION

Sec. 401. Hydrogen installation, infrastructure, and fuel costs.
Sec. 402. Report on cellulosic ethanol.
                  TITLE V--INCENTIVES FOR CLEAN ENERGY

           Subtitle A--Extension of Clean Energy Tax Credits

Sec. 500. Amendment of 1986 code.
        Part I--Extension of Clean Energy Production Incentives

Sec. 501. Extension and modification of renewable energy production tax 
                            credit.
Sec. 502. Extension and modification of solar energy and fuel cell 
                            investment tax credit.
Sec. 503. Extension and modification of residential energy efficient 
                            property credit.
Sec. 504. Extension and modification of credit for clean renewable 
                            energy bonds.
Sec. 505. Extension of special rule to implement FERC restructuring 
                            policy.
     Part II--Extension of Incentives to Improve Energy Efficiency

Sec. 511. Extension and modification of credit for energy efficiency 
                            improvements to existing homes.
Sec. 512. Extension and modification of tax credit for energy efficient 
                            new homes.
Sec. 513. Extension and modification of energy efficient commercial 
                            buildings deduction.
Sec. 514. Modification and extension of energy efficient appliance 
                            credit for appliances produced after 2007.
                  Subtitle B--Mineral Royalty Payments

Sec. 521. Termination of authority to deduct amounts from share of oil 
                            and gas leasing revenues provided to 
                            States.
                 TITLE VI--COAL-TECHNOLOGY DEVELOPMENT

                      Subtitle A--Coal to Liquids

Sec. 601. Definitions.
Sec. 602. Coal-to-liquid fuel loan guarantee program.
Sec. 603. Coal-to-liquid facilities loan program.
Sec. 604. Location of coal-to-liquid manufacturing facilities.
Sec. 605. Strategic petroleum reserve.
Sec. 606. Authorization to conduct research, development, testing, and 
                            evaluation of assured domestic fuels.
Sec. 607. Coal-to-liquid long-term fuel procurement and department of 
                            defense development.
Sec. 608. Report on emissions of Fischer-Tropsch products used as 
                            transportation fuels.
       Subtitle B--Tax Incentives for Coal-to-Liquids Production

Sec. 611. Credit for investment in coal-to-liquid fuels projects.
Sec. 612. Temporary expensing for equipment used in coal-to-liquid 
                            fuels process.
Sec. 613. Extension of alternative fuel credit for fuel derived from 
                            coal through the fischer-tropsch process.
Sec. 614. Modifications to enhanced oil recovery credit.
Sec. 615. Allowance of enhanced oil, natural gas, and coalbed methane 
                            recovery, and capture and sequestration 
                            credit against the alternative minimum tax.
              Subtitle C--Clean Coal Technology Deployment

Sec. 621. Carbon sequestration and capture.
  Subtitle D--Reduced Carbon Emissions Through Clean Coal Technologies

Sec. 631. Statement of policy.
Sec. 632. Clean coal research and development.
Sec. 633. Clean coal demonstration.
Sec. 634. Identification of clean coal research, development, and 
                            demonstration projects.
              Subtitle E--Clean Coal Technology Incentives

Sec. 641. Short title.
Sec. 642. Modification of special rules for atmospheric pollution 
                            control facilities.
Sec. 643. Extension and modification of production credit for closed-
                            loop biomass.
Sec. 644. Qualifying new clean coal power plant credit.
Sec. 645. Investment credit for equipment used to capture, transport, 
                            and store carbon dioxide.
Sec. 646. Tax credit for carbon dioxide sequestration in the generation 
                            of electricity.
Sec. 647. Clean energy coal bonds.
                       TITLE VII--NUCLEAR ENERGY

           Subtitle A--Nuclear Waste Access to Yucca Mountain

Sec. 701. Definitions.
Sec. 702. Withdrawal of land.
Sec. 703. Receipt and storage facilities.
Sec. 704. Repeal of capacity limitation.
Sec. 705. Infrastructure activities.
Sec. 706. Rail line.
Sec. 707. Nuclear Waste Fund.
Sec. 708. Waste confidence.
                       Subtitle B--Tax Provisions

Sec. 711. Investment tax credit for investments in nuclear power 
                            facilities.
Sec. 712. 5-year accelerated depreciation for new nuclear power 
                            facilities.
       TITLE VIII--LEASING PROGRAM FOR LAND WITHIN COASTAL PLAIN

Sec. 801. Definitions.
Sec. 802. Leasing program for land within the Coastal Plain.
Sec. 803. Lease sales.
Sec. 804. Grant of leases by the Secretary.
Sec. 805. Lease terms and conditions.
Sec. 806. Coastal Plain environmental protection.
Sec. 807. Expedited judicial review.
Sec. 808. Rights-of-way and easements across Coastal Plain.
Sec. 809. Conveyance.
Sec. 810. Local government impact aid and community service assistance.
Sec. 811. Prohibition on exports.
Sec. 812. Allocation of revenues.

                    TITLE I--SAVING AMERICAN ENERGY

                 Subtitle A--Plug in Hybrid Technology

SEC. 101. ADVANCED BATTERIES FOR ELECTRIC DRIVE VEHICLES.

    (a) Definitions.--In this section:
            (1) Advanced battery.--The term ``advanced battery'' means 
        an electrical storage device that is suitable for a vehicle 
        application.
            (2) Engineering integration costs.--The term ``engineering 
        integration costs'' includes the cost of engineering tasks 
        relating to--
                    (A) the incorporation of qualifying components into 
                the design of an advanced battery; and
                    (B) the design of tooling and equipment and the 
                development of manufacturing processes and material for 
                suppliers of production facilities that produce 
                qualifying components or advanced batteries.
            (3) Secretary.--The term ``Secretary'' means the Secretary 
        of Energy.
    (b) Advanced Battery Research and Development.--
            (1) In general.--The Secretary shall--
                    (A) expand and accelerate research and development 
                efforts for advanced batteries; and
                    (B) emphasize lower cost means of producing abuse-
                tolerant advanced batteries with the appropriate 
                balance of power and energy capacity to meet market 
                requirements.
            (2) Authorization of appropriations.--There is authorized 
        to be appropriated to carry out this subsection $100,000,000 
        for each of fiscal years 2010 through 2014.
    (c) Direct Loan Program.--
            (1) In general.--Subject to the availability of 
        appropriated funds, not later than 1 year after the date of 
        enactment of this Act, the Secretary shall carry out a program 
        to provide a total of not more than $250,000,000 in loans to 
        eligible individuals and entities for not more than 30 percent 
        of the costs of 1 or more of--
                    (A) reequipping a manufacturing facility in the 
                United States to produce advanced batteries;
                    (B) expanding a manufacturing facility in the 
                United States to produce advanced batteries; or
                    (C) establishing a manufacturing facility in the 
                United States to produce advanced batteries.
            (2) Eligibility.--
                    (A) In general.--To be eligible to obtain a loan 
                under this subsection, an individual or entity shall--
                            (i) be financially viable without the 
                        receipt of additional Federal funding 
                        associated with a proposed project under this 
                        subsection;
                            (ii) provide sufficient information to the 
                        Secretary for the Secretary to ensure that the 
                        qualified investment is expended efficiently 
                        and effectively; and
                            (iii) meet such other criteria as may be 
                        established and published by the Secretary.
                    (B) Consideration.--In selecting eligible 
                individuals or entities for loans under this 
                subsection, the Secretary may consider whether the 
                proposed project of an eligible individual or entity 
                under this subsection would--
                            (i) reduce manufacturing time;
                            (ii) reduce manufacturing energy intensity;
                            (iii) reduce negative environmental impacts 
                        or byproducts; or
                            (iv) increase spent battery or component 
                        recycling.
            (3) Rates, terms, and repayment of loans.--A loan provided 
        under this subsection--
                    (A) shall have an interest rate that, as of the 
                date on which the loan is made, is equal to the cost of 
                funds to the Department of the Treasury for obligations 
                of comparable maturity;
                    (B) shall have a term that is equal to the lesser 
                of--
                            (i) the projected life, in years, of the 
                        eligible project to be carried out using funds 
                        from the loan, as determined by the Secretary; 
                        or
                            (ii) 25 years; and
                    (C) may be subject to a deferral in repayment for 
                not more than 5 years after the date on which the 
                eligible project carried out using funds from the loan 
                first begins operations, as determined by the 
                Secretary.
            (4) Period of availability.--A loan under this subsection 
        shall be available for--
                    (A) facilities and equipment placed in service 
                before December 30, 2020; and
                    (B) engineering integration costs incurred during 
                the period beginning on the date of enactment of this 
                Act and ending on December 30, 2020.
            (5) Fees.--The cost of administering a loan made under this 
        subsection shall not exceed $100,000.
            (6) Authorization of appropriations.--There are authorized 
        to be appropriated such sums as are necessary to carry out this 
        subsection for each of fiscal years 2009 through 2013.
    (d) Sense of the Senate on Purchase of Plug-in Electric Drive 
Vehicles.--It is the sense of the Senate that, to the maximum extent 
practicable, the Federal Government should implement policies to 
increase the purchase of plug-in electric drive vehicles by the Federal 
Government.

                Subtitle B--Promoting Energy Efficiency

SEC. 111. EXPANDING INFORMATION ON ENERGY SAVINGS TECHNIQUES.

    Not later than 1 year after the date of enactment of this Act, the 
Secretary of Energy shall submit to Congress a report that contains 
recommendations on--
            (1) educational outreach opportunities that can be 
        implemented by Federal agencies to increase the knowledge of 
        the people of the United States of energy saving techniques 
        that can be used in daily life; and
            (2) actions that can be taken by Congress to increase the 
        knowledge of the people of the United States of energy saving 
        techniques that can be used in daily life.

              TITLE II--INCREASING AMERICAN ENERGY SUPPLY

                  Subtitle A--Outer Continental Shelf

SEC. 201. PUBLICATION OF PROJECTED STATE LINES ON OUTER CONTINENTAL 
              SHELF.

    Section 4(a)(2)(A) of the Outer Continental Shelf Lands Act (43 
U.S.C. 1333(a)(2)(A)) is amended--
            (1) by designating the first, second, and third sentences 
        as clause (i), (iii), and (iv), respectively;
            (2) in clause (i) (as so designated), by inserting before 
        the period at the end the following: ``not later than 90 days 
        after the date of enactment of the Eight Steps for Energy 
        Security Act of 2008''; and
            (3) by inserting after clause (i) (as so designated) the 
        following:
                            ``(i)(I) The projected lines shall also be 
                        used for the purpose of preleasing and leasing 
                        activities conducted in new producing areas 
                        under section 32.
                            ``(II) This clause shall not affect any 
                        property right or title to Federal submerged 
                        land on the outer Continental Shelf.
                            ``(III) In carrying out this clause, the 
                        President shall consider the offshore 
                        administrative boundaries beyond State 
                        submerged lands for planning, coordination, and 
                        administrative purposes of the Department of 
                        the Interior, but may establish different 
                        boundaries.''.

SEC. 202. PRODUCTION OF OIL AND NATURAL GAS IN NEW PRODUCING AREAS.

    The Outer Continental Shelf Lands Act (43 U.S.C. 1331 et seq.) is 
amended by adding at the end the following:

``SEC. 32. PRODUCTION OF OIL AND NATURAL GAS IN NEW PRODUCING AREAS.

    ``(a) Definitions.--In this section:
            ``(1) Coastal political subdivision.--The term `coastal 
        political subdivision' means a political subdivision of a new 
        producing State any part of which political subdivision is--
                    ``(A) within the coastal zone (as defined in 
                section 304 of the Coastal Zone Management Act of 1972 
                (16 U.S.C. 1453)) of the new producing State as of the 
                date of enactment of this section; and
                    ``(B) not more than 200 nautical miles from the 
                geographic center of any leased tract.
            ``(2) Moratorium area.--
                    ``(A) In general.--The term `moratorium area' means 
                an area covered by sections 104 through 105 of the 
                Department of the Interior, Environment, and Related 
                Agencies Appropriations Act, 2008 (Public Law 110-161; 
                121 Stat. 2118) (as in effect on the day before the 
                date of enactment of this section).
                    ``(B) Exclusion.--The term `moratorium area' does 
                not include an area located in the Gulf of Mexico.
            ``(3) New producing area.--The term `new producing area' 
        means any moratorium area within the offshore administrative 
        boundaries beyond the submerged land of a State that is located 
        greater than 50 miles from the coastline of the State.
            ``(4) New producing state.--The term `new producing State' 
        means a State that has, within the offshore administrative 
        boundaries beyond the submerged land of the State, a new 
        producing area available for oil and gas leasing under 
        subsection (b).
            ``(5) Offshore administrative boundaries.--The term 
        `offshore administrative boundaries' means the administrative 
        boundaries established by the Secretary beyond State submerged 
        land for planning, coordination, and administrative purposes of 
        the Department of the Interior and published in the Federal 
        Register on January 3, 2006 (71 Fed. Reg. 127).
            ``(6) Qualified outer continental shelf revenues.--
                    ``(A) In general.--The term `qualified outer 
                Continental Shelf revenues' means all rentals, 
                royalties, bonus bids, and other sums due and payable 
                to the United States from leases entered into on or 
                after the date of enactment of this section for new 
                producing areas.
                    ``(B) Exclusions.--The term `qualified outer 
                Continental Shelf revenues' does not include--
                            ``(i) revenues from a bond or other surety 
                        forfeited for obligations other than the 
                        collection of royalties;
                            ``(ii) revenues from civil penalties;
                            ``(iii) royalties taken by the Secretary 
                        in-kind and not sold;
                            ``(iv) revenues generated from leases 
                        subject to section 8(g); or
                            ``(v) any revenues considered qualified 
                        outer Continental Shelf revenues under section 
                        102 of the Gulf of Mexico Energy Security Act 
                        of 2006 (43 U.S.C. 1331 note; Public Law 109-
                        432).
    ``(b) Petition for Leasing New Producing Areas.--
            ``(1) In general.--Beginning on the date on which the 
        President delineates projected State lines under section 
        4(a)(2)(A)(ii), the Governor of a State, with the concurrence 
        of the legislature of the State, with a new producing area 
        within the offshore administrative boundaries beyond the 
        submerged land of the State may submit to the Secretary a 
        petition requesting that the Secretary make the new producing 
        area available for oil and gas leasing.
            ``(2) Action by secretary.--Notwithstanding section 18, as 
        soon as practicable after receipt of a petition under paragraph 
        (1), the Secretary shall approve the petition if the Secretary 
        determines that leasing the new producing area would not create 
        an unreasonable risk of harm to the marine, human, or coastal 
        environment.
    ``(c) Disposition of Qualified Outer Continental Shelf Revenues 
From New Producing Areas.--
            ``(1) In general.--Notwithstanding section 9 and subject to 
        the other provisions of this subsection, for each applicable 
        fiscal year, the Secretary of the Treasury shall deposit--
                    ``(A) 50 percent of qualified outer Continental 
                Shelf revenues in the general fund of the Treasury; and
                    ``(B) 50 percent of qualified outer Continental 
                Shelf revenues in a special account in the Treasury 
                from which the Secretary shall disburse--
                            ``(i) 75 percent to new producing States in 
                        accordance with paragraph (2); and
                            ``(ii) 25 percent to provide financial 
                        assistance to States in accordance with section 
                        6 of the Land and Water Conservation Fund Act 
                        of 1965 (16 U.S.C. 460l-8), which shall be 
                        considered income to the Land and Water 
                        Conservation Fund for purposes of section 2 of 
                        that Act (16 U.S.C. 460l-5).
            ``(2) Allocation to new producing states and coastal 
        political subdivisions.--
                    ``(A) Allocation to new producing states.--
                Effective for fiscal year 2008 and each fiscal year 
                thereafter, the amount made available under paragraph 
                (1)(B)(i) shall be allocated to each new producing 
                State in amounts (based on a formula established by the 
                Secretary by regulation) proportional to the amount of 
                qualified outer Continental Shelf revenues generated in 
                the new producing area offshore each State.
                    ``(B) Payments to coastal political subdivisions.--
                            ``(i) In general.--The Secretary shall pay 
                        20 percent of the allocable share of each new 
                        producing State, as determined under 
                        subparagraph (A), to the coastal political 
                        subdivisions of the new producing State.
                            ``(ii) Allocation.--The amount paid by the 
                        Secretary to coastal political subdivisions 
                        shall be allocated to each coastal political 
                        subdivision in accordance with the regulations 
                        promulgated under subparagraph (A).
            ``(3) Minimum allocation.--The amount allocated to a new 
        producing State for each fiscal year under paragraph (2) shall 
        be at least 5 percent of the amounts available for the fiscal 
        year under paragraph (1)(B)(i).
            ``(4) Timing.--The amounts required to be deposited under 
        subparagraph (B) of paragraph (1) for the applicable fiscal 
        year shall be made available in accordance with that 
        subparagraph during the fiscal year immediately following the 
        applicable fiscal year.
            ``(5) Authorized uses.--
                    ``(A) In general.--Subject to subparagraph (B), 
                each new producing State and coastal political 
                subdivision shall use all amounts received under 
                paragraph (2) in accordance with all applicable Federal 
                and State laws, only for 1 or more of the following 
                purposes:
                            ``(i) Projects and activities for the 
                        purposes of coastal protection, including 
                        conservation, coastal restoration, hurricane 
                        protection, and infrastructure directly 
                        affected by coastal wetland losses.
                            ``(ii) Mitigation of damage to fish, 
                        wildlife, or natural resources.
                            ``(iii) Implementation of a federally 
                        approved marine, coastal, or comprehensive 
                        conservation management plan.
                            ``(iv) Funding of onshore infrastructure 
                        projects.
                            ``(v) Planning assistance and the 
                        administrative costs of complying with this 
                        section.
                    ``(B) Limitation.--Not more than 3 percent of 
                amounts received by a new producing State or coastal 
                political subdivision under paragraph (2) may be used 
                for the purposes described in subparagraph (A)(v).
            ``(6) Administration.--Amounts made available under 
        paragraph (1)(B) shall--
                    ``(A) be made available, without further 
                appropriation, in accordance with this subsection;
                    ``(B) remain available until expended; and
                    ``(C) be in addition to any amounts appropriated 
                under--
                            ``(i) other provisions of this Act;
                            ``(ii) the Land and Water Conservation Fund 
                        Act of 1965 (16 U.S.C. 460l-4 et seq.); or
                            ``(iii) any other provision of law.
    ``(d) Disposition of Qualified Outer Continental Shelf Revenues 
From Other Areas.--Notwithstanding section 9, for each applicable 
fiscal year, the terms and conditions of subsection (c) shall apply to 
the disposition of qualified outer Continental Shelf revenues that--
            ``(1) are derived from oil or gas leasing in an area that 
        is not included in the current 5-year plan of the Secretary for 
        oil or gas leasing; and
            ``(2) are not assumed in the budget of the United States 
        Government submitted by the President under section 1105 of 
        title 31, United States Code.''.

SEC. 203. CONFORMING AMENDMENTS.

    Sections 104 and 105 of the Department of the Interior, 
Environment, and Related Agencies Appropriations Act, 2008 (Public Law 
110-161; 121 Stat. 2118) are amended by striking ``No funds'' each 
place it appears and inserting ``Except as provided in section 32 of 
the Outer Continental Shelf Lands Act, no funds''.

                   Subtitle B--Oil Shale Development

SEC. 211. REMOVAL OF PROHIBITION ON FINAL REGULATIONS FOR COMMERCIAL 
              LEASING PROGRAM FOR OIL SHALE RESOURCES ON PUBLIC LAND.

    Section 433 of the Department of the Interior, Environment, and 
Related Agencies Appropriations Act, 2008 (Public Law 110-161; 121 
Stat. 2152) is repealed.

                    TITLE III--STREAMLINE PERMITTING

           Subtitle A--Streamline Refinery Permitting Process

SEC. 301. REFINERY PERMITTING PROCESS.

    (a) Definitions.--In this section:
            (1) Administrator.--The term ``Administrator'' means the 
        Administrator of the Environmental Protection Agency.
            (2) 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).
            (3) Permit.--The term ``permit'' means any permit, license, 
        approval, variance, or other form of authorization that a 
        refiner is required to obtain--
                    (A) under any Federal law; or
                    (B) from a State or Indian tribal government agency 
                delegated authority by the Federal Government, or 
                authorized under Federal law, to issue permits.
            (4) Refiner.--The term ``refiner'' means a person that--
                    (A) owns or operates a refinery; or
                    (B) seeks to become an owner or operator of a 
                refinery.
            (5) Refinery.--
                    (A) In general.--The term ``refinery'' means--
                            (i) a facility at which crude oil is 
                        refined into transportation fuel or other 
                        petroleum products; and
                            (ii) a coal liquification or coal-to-liquid 
                        facility at which coal is processed into 
                        synthetic crude oil or any other fuel.
                    (B) Inclusions.--The term ``refinery'' includes an 
                expansion of a refinery.
            (6) Refinery expansion.--The term ``refinery expansion'' 
        means a physical change in a refinery that results in an 
        increase in the capacity of the refinery.
            (7) Refinery permitting agreement.--The term ``refinery 
        permitting agreement'' means an agreement entered into between 
        the Administrator and a State or Indian tribe under subsection 
        (b).
            (8) Secretary.--The term ``Secretary'' means the Secretary 
        of Commerce.
            (9) 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.
    (b) Streamlining of Refinery Permitting Process.--
            (1) In general.--At the request of the Governor of a State 
        or the governing body of an Indian tribe, the Administrator 
        shall enter into a refinery permitting agreement with the State 
        or Indian tribe under which the process for obtaining all 
        permits necessary for the construction and operation of a 
        refinery shall be streamlined using a systematic 
        interdisciplinary multimedia approach as provided in this 
        section.
            (2) Authority of administrator.--Under a refinery 
        permitting agreement--
                    (A) the Administrator shall have authority, as 
                applicable and necessary, to--
                            (i) accept from a refiner a consolidated 
                        application for all permits that the refiner is 
                        required to obtain to construct and operate a 
                        refinery;
                            (ii) in consultation and cooperation with 
                        each Federal, State, or Indian tribal 
                        government agency that is required to make any 
                        determination to authorize the issuance of a 
                        permit, establish a schedule under which each 
                        agency shall--
                                    (I) concurrently consider, to the 
                                maximum extent practicable, each 
                                determination to be made; and
                                    (II) complete each step in the 
                                permitting process; and
                            (iii) issue a consolidated permit that 
                        combines all permits issued under the schedule 
                        established under clause (ii); and
                    (B) the Administrator shall provide to State and 
                Indian tribal government agencies--
                            (i) financial assistance in such amounts as 
                        the agencies reasonably require to hire such 
                        additional personnel as are necessary to enable 
                        the government agencies to comply with the 
                        applicable schedule established under 
                        subparagraph (A)(ii); and
                            (ii) technical, legal, and other assistance 
                        in complying with the refinery permitting 
                        agreement.
            (3) Agreement by the state.--Under a refinery permitting 
        agreement, a State or governing body of an Indian tribe shall 
        agree that--
                    (A) the Administrator shall have each of the 
                authorities described in paragraph (2); and
                    (B) each State or Indian tribal government agency 
                shall--
                            (i) in accordance with State law, make such 
                        structural and operational changes in the 
                        agencies as are necessary to enable the 
                        agencies to carry out consolidated project-wide 
                        permit reviews concurrently and in coordination 
                        with the Environmental Protection Agency and 
                        other Federal agencies; and
                            (ii) comply, to the maximum extent 
                        practicable, with the applicable schedule 
                        established under paragraph (2)(A)(ii).
            (4) Deadlines.--
                    (A) New refineries.--In the case of a consolidated 
                permit for the construction of a new refinery, the 
                Administrator and the State or governing body of an 
                Indian tribe shall approve or disapprove the 
                consolidated permit not later than--
                            (i) 360 days after the date of the receipt 
                        of the administratively complete application 
                        for the consolidated permit; or
                            (ii) on agreement of the applicant, the 
                        Administrator, and the State or governing body 
                        of the Indian tribe, 90 days after the 
                        expiration of the deadline established under 
                        clause (i).
                    (B) Expansion of existing refineries.--In the case 
                of a consolidated permit for the expansion of an 
                existing refinery, the Administrator and the State or 
                governing body of an Indian tribe shall approve or 
                disapprove the consolidated permit not later than--
                            (i) 120 days after the date of the receipt 
                        of the administratively complete application 
                        for the consolidated permit; or
                            (ii) on agreement of the applicant, the 
                        Administrator, and the State or governing body 
                        of the Indian tribe, 30 days after the 
                        expiration of the deadline established under 
                        clause (i).
            (5) Federal agencies.--Each Federal agency that is required 
        to make any determination to authorize the issuance of a permit 
        shall comply with the applicable schedule established under 
        paragraph (2)(A)(ii).
            (6) Judicial review.--Any civil action for review of any 
        permit determination under a refinery permitting agreement 
        shall be brought exclusively in the United States district 
        court for the district in which the refinery is located or 
        proposed to be located.
            (7) Efficient permit review.--In order to reduce the 
        duplication of procedures, the Administrator shall use State 
        permitting and monitoring procedures to satisfy substantially 
        equivalent Federal requirements under this title.
            (8) Severability.--If 1 or more permits that are required 
        for the construction or operation of a refinery are not 
        approved on or before any deadline established under paragraph 
        (4), the Administrator may issue a consolidated permit that 
        combines all other permits that the refiner is required to 
        obtain other than any permits that are not approved.
            (9) Savings.--Nothing in this subsection affects the 
        operation or implementation of otherwise applicable law 
        regarding permits necessary for the construction and operation 
        of a refinery.
            (10) Consultation with local governments.--Congress 
        encourages the Administrator, States, and tribal governments to 
        consult, to the maximum extent practicable, with local 
        governments in carrying out this subsection.
            (11) Authorization of appropriations.--There are authorized 
        to be appropriated such sums as are necessary to carry out this 
        subsection.
            (12) Effect on local authority.--Nothing in this subsection 
        affects--
                    (A) the authority of a local government with 
                respect to the issuance of permits; or
                    (B) any requirement or ordinance of a local 
                government (such as a zoning regulation).
    (c) Fischer-Tropsch Fuels.--
            (1) In general.--In cooperation with the Secretary of 
        Energy, the Secretary of Defense, the Administrator of the 
        Federal Aviation Administration, Secretary of Health and Human 
        Services, and Fischer-Tropsch industry representatives, the 
        Administrator shall--
                    (A) conduct a research and demonstration program to 
                evaluate the air quality benefits of ultra-clean 
                Fischer-Tropsch transportation fuel, including diesel 
                and jet fuel;
                    (B) evaluate the use of ultra-clean Fischer-Tropsch 
                transportation fuel as a mechanism for reducing engine 
                exhaust emissions; and
                    (C) submit recommendations to Congress on the most 
                effective use and associated benefits of these ultra-
                clean fuel for reducing public exposure to exhaust 
                emissions.
            (2) Guidance and technical support.--The Administrator 
        shall, to the extent necessary, issue any guidance or technical 
        support documents that would facilitate the effective use and 
        associated benefit of Fischer-Tropsch fuel and blends.
            (3) Requirements.--The program described in paragraph (1) 
        shall consider--
                    (A) the use of neat (100 percent) Fischer-Tropsch 
                fuel and blends with conventional crude oil-derived 
                fuel for heavy-duty and light-duty diesel engines and 
                the aviation sector; and
                    (B) the production costs associated with domestic 
                production of those ultra clean fuel and prices for 
                consumers.
            (4) Reports.--The Administrator shall submit to the 
        Committee on Environment and Public Works and the Committee on 
        Energy and Natural Resources of the Senate and the Committee on 
        Energy and Commerce of the House of Representatives--
                    (A) not later than 1 year, an interim report on 
                actions taken to carry out this subsection; and
                    (B) not later than 2 years, a final report on 
                actions taken to carry out this subsection.

        Subtitle B--Application for Permit to Drill Fee Removal

SEC. 311. REMOVAL OF ADDITIONAL FEE FOR NEW APPLICATIONS FOR PERMITS TO 
              DRILL.

    The second undesignated paragraph of the matter under the heading 
``management of lands and resources'' under the heading ``Bureau of 
Land Management'' of title I of the Department of the Interior, 
Environment, and Related Agencies Appropriations Act, 2008 (Public Law 
110-161; 121 Stat. 2098) is amended by striking ``to be reduced'' and 
all that follows through ``each new application,''.

    Subtitle C--Report on National Environmental Policy Act of 1969

SEC. 321. REPORT ON NATIONAL ENVIRONMENTAL POLICY ACT OF 1969.

    Not later than 180 days after the date of enactment of this Act, 
the Secretary of the Interior, in consultation with the Secretary of 
Energy and the Administrator of the Environmental Protection Agency, 
shall submit to Congress a report on actions that can be taken to 
streamline the National Environmental Policy Act of 1969 (42 U.S.C. 
4321 et seq.) to limit litigation under that Act and increase energy 
production.

                          TITLE IV--INNOVATION

SEC. 401. HYDROGEN INSTALLATION, INFRASTRUCTURE, AND FUEL COSTS.

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

``SEC. 30D. HYDROGEN INSTALLATION, INFRASTRUCTURE, AND FUEL COSTS.

    ``(a) Allowance of Credit.--There shall be allowed as a credit 
against the tax imposed by this chapter for the taxable year an amount 
equal to the sum of--
            ``(1) the hydrogen installation and infrastructure costs 
        credit determined under subsection (b), and
            ``(2) the hydrogen fuel costs credit determined under 
        subsection (c).
    ``(b) Hydrogen Installation and Infrastructure Costs Credit.--
            ``(1) In general.--For purposes of subsection (a), the 
        hydrogen installation and infrastructure costs credit 
        determined under this subsection with respect to each eligible 
        hydrogen production and distribution facility of the taxpayer 
        is an amount equal to--
                    ``(A) 30 percent of so much of the installation 
                costs which when added to such costs taken into account 
                with respect to such facility for all preceding taxable 
                years under this subparagraph does not exceed $200,000, 
                plus
                    ``(B) 30 percent of so much of the infrastructure 
                costs for the taxable year as does not exceed $200,000 
                with respect to such facility, and which when added to 
                such costs taken into account with respect to such 
                facility for all preceding taxable years under this 
                subparagraph does not exceed $600,000.
        Nothing in this section shall permit the same cost to be taken 
        into account more than once.
            ``(2) Eligible hydrogen production and distribution 
        facility.--For purposes of this subsection, the term `eligible 
        hydrogen production and distribution facility' means a hydrogen 
        production and distribution facility which is placed in service 
        after December 31, 2008.
    ``(c) Hydrogen Fuel Costs Credit.--
            ``(1) In general.--For purposes of subsection (a), the 
        hydrogen fuel costs credit determined under this subsection 
        with respect to each eligible hydrogen device of the taxpayer 
        is an amount equal to the qualified hydrogen expenditure 
        amounts with respect to such device.
            ``(2) Qualified hydrogen expenditure amount.--For purposes 
        of this subsection--
                    ``(A) In general.--The term `qualified hydrogen 
                expenditure amount' means, with respect to each 
                eligible hydrogen energy conversion device of the 
                taxpayer with a production capacity of not more than 25 
                kilowatts of electricity per year, the lesser of--
                            ``(i) 30 percent of the amount paid or 
                        incurred by the taxpayer during the taxable 
                        year for hydrogen which is consumed by such 
                        device, and
                            ``(ii) $2,000.
                In the case of any device which is not owned by the 
                taxpayer at all times during the taxable year, the 
                $2,000 amount in subparagraph (B) shall be reduced by 
                an amount which bears the same ratio to $2,000 as the 
                portion of the year which such device is not owned by 
                the taxpayer bears to the entire year.
                    ``(B) Higher limitation for devices with more 
                production capacity.--In the case of any eligible 
                hydrogen energy conversion device with a production 
                capacity of--
                            ``(i) more than 25 but less than 100 
                        kilowatts of electricity per year, subparagraph 
                        (A) shall be applied by substituting `$4,000' 
                        for `$2,000' each place it appears, and
                            ``(ii) not less than 100 kilowatts of 
                        electricity per year, subparagraph (A) shall be 
                        applied by substituting `$6,000' for `$2,000' 
                        each place it appears.
            ``(3) Eligible hydrogen energy conversion devices.--For 
        purposes of this subsection--
                    ``(A) In general.--The term `eligible hydrogen 
                energy conversion device' means, with respect to any 
                taxpayer, any hydrogen energy conversion device which--
                            ``(i) is placed in service after December 
                        31, 2004, and
                            ``(ii) is wholly owned by the taxpayer 
                        during the taxable year.
                If an owner of a device (determined without regard to 
                this subparagraph) provides to the primary user of such 
                device a written statement that such user shall be 
                treated as the owner of such device for purposes of 
                this section, then such user (and not such owner) shall 
                be so treated.
                    ``(B) Hydrogen energy conversion device.--The term 
                `hydrogen energy conversion device' means--
                            ``(i) any electrochemical device which 
                        converts hydrogen into electricity, and
                            ``(ii) any combustion engine which burns 
                        hydrogen as a fuel.
    ``(d) Reduction in Basis.--For purposes of this subtitle, if a 
credit is allowed under this section for any expenditure with respect 
to any property, the increase in the basis of such property which would 
(but for this paragraph) result from such expenditure shall be reduced 
by the amount of the credit so allowed.
    ``(e) Application With Other Credits.--
            ``(1) Business credit treated as part of general business 
        credit.--So much of the credit which would be allowed under 
        subsection (a) for any taxable year (determined without regard 
        to this subsection) that is attributable to amounts which (but 
        for subsection (g) would be allowed as a deduction under 
        section 162 shall be treated as a credit listed in section 
        38(b) for such taxable year (and not allowed under subsection 
        (a)).
            ``(2) Personal credit.--The credit allowed under subsection 
        (a) (after the application of paragraph (1)) for any taxable 
        year shall not exceed the excess (if any) of--
                    ``(A) the regular tax liability (as defined in 
                section 26(b)) reduced by the sum of the credits 
                allowable under subpart A and sections 27, 30, 30B, and 
                30C, over
                    ``(B) the tentative minimum tax for the taxable 
                year.
    ``(f) Denial of Double Benefit.--The amount of any deduction or 
other credit allowable under this chapter for any cost taken into 
account in determining the amount of the credit under subsection (a) 
shall be reduced by the amount of such credit attributable to such 
cost.
    ``(g) Recapture.--The Secretary shall, by regulations, provided for 
recapturing the benefit of any credit allowable under subsection (a) 
with respect to any property which ceases to be property eligible for 
such credit.
    ``(h) Election Not To Take Credit.--No credit shall be allowed 
under subsection (a) for any property if the taxpayer elects not to 
have this section apply to such property.
    ``(i) Regulations.--The Secretary shall prescribe such regulations 
as necessary to carry out the provisions of this section.
    ``(j) Termination.--This section shall not apply to any costs after 
December 31, 2012.''.
    (b) Conforming Amendments.--
            (1) Section 38(b) of the Internal Revenue Code of 1986 is 
        amended by striking ``plus'' at the end of paragraph (32), by 
        striking the period at the end of paragraph (33) and inserting 
        ``plus'', and by adding at the end the following new paragraph:
            ``(34) the portion of the hydrogen installation, 
        infrastructure, and fuel credit to which section 30D(e)(1) 
        applies.''.
            (2) Section 55(c)(3) of such Code is amended by inserting 
        ``30F(e)(2),'' after ``30C(d)(2),''.
            (3) Section 1016(a) of such Code is amended by striking 
        ``and'' at the end of paragraph (35), by striking the period at 
        the end of paragraph (36) and inserting ``, and'', and by 
        adding at the end the following new paragraph:
            ``(37) to the extent provided in section 30D(d).''.
            (4) Section 6501(m) of such Code is amended by inserting 
        ``30D(h),'' after ``30C(e)(5),''.
            (5) The table of sections for subpart B of part IV of 
        subchapter A of chapter 1 of such Code is amended by inserting 
        after the item relating to section 30C the following new item:

``Sec. 30D. Hydrogen installation, infrastructure, and fuel costs.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred after the date of the enactment of 
this Act, in taxable years ending after such date.

SEC. 402. REPORT ON CELLULOSIC ETHANOL.

    Not later than 180 days after the date of enactment of this Act, 
the Administrator of the Environmental Protection Agency, in 
consultation with the Secretary of Energy and the Secretary of the 
Interior, shall provide to Congress a report that--
            (1) analyzes Federal incentives to increase the production 
        of cellulosic ethanol; and
            (2) provides recommendations--
                    (A) on the effectiveness of those incentives; and
                    (B) for additional incentives to increase 
                production of cellulosic ethanol.

                  TITLE V--INCENTIVES FOR CLEAN ENERGY

           Subtitle A--Extension of Clean Energy Tax Credits

SEC. 500. AMENDMENT OF 1986 CODE.

    Except as otherwise expressly provided, whenever in this subtitle 
an amendment or repeal is expressed in terms of an amendment to, or 
repeal of, a section or other provision, the reference shall be 
considered to be made to a section or other provision of the Internal 
Revenue Code of 1986.

        PART I--EXTENSION OF CLEAN ENERGY PRODUCTION INCENTIVES

SEC. 501. EXTENSION AND MODIFICATION OF RENEWABLE ENERGY PRODUCTION TAX 
              CREDIT.

    (a) Extension of Credit.--Each of the following provisions of 
section 45(d) (relating to qualified facilities) is amended by striking 
``January 1, 2009'' and inserting ``January 1, 2014'':
            (1) Paragraph (1).
            (2) Clauses (i) and (ii) of paragraph (2)(A).
            (3) Clauses (i)(I) and (ii) of paragraph (3)(A).
            (4) Paragraph (4).
            (5) Paragraph (5).
            (6) Paragraph (6).
            (7) Paragraph (7).
            (8) Paragraph (8).
            (9) Subparagraphs (A) and (B) of paragraph (9).
    (b) Production Credit for Electricity Produced From Marine 
Renewables.--
            (1) In general.--Paragraph (1) of section 45(c) (relating 
        to resources) is amended by striking ``and'' at the end of 
        subparagraph (G), by striking the period at the end of 
        subparagraph (H) and inserting ``, and'', and by adding at the 
        end the following new subparagraph:
                    ``(I) marine and hydrokinetic renewable energy.''.
            (2) Marine renewables.--Subsection (c) of section 45 is 
        amended by adding at the end the following new paragraph:
            ``(10) Marine and hydrokinetic renewable energy.--
                    ``(A) In general.--The term `marine and 
                hydrokinetic renewable energy' means energy derived 
                from--
                            ``(i) waves, tides, and currents in oceans, 
                        estuaries, and tidal areas,
                            ``(ii) free flowing water in rivers, lakes, 
                        and streams,
                            ``(iii) free flowing water in an irrigation 
                        system, canal, or other man-made channel, 
                        including projects that utilize nonmechanical 
                        structures to accelerate the flow of water for 
                        electric power production purposes, or
                            ``(iv) differentials in ocean temperature 
                        (ocean thermal energy conversion).
                    ``(B) Exceptions.--Such term shall not include any 
                energy which is derived from any source which utilizes 
                a dam, diversionary structure (except as provided in 
                subparagraph (A)(iii)), or impoundment for electric 
                power production purposes.''.
            (3) Definition of facility.--Subsection (d) of section 45 
        is amended by adding at the end the following new paragraph:
            ``(11) Marine and hydrokinetic renewable energy 
        facilities.--In the case of a facility producing electricity 
        from marine and hydrokinetic renewable energy, the term 
        `qualified facility' means any facility owned by the taxpayer--
                    ``(A) which has a nameplate capacity rating of at 
                least 150 kilowatts, and
                    ``(B) which is originally placed in service on or 
                after the date of the enactment of this paragraph and 
                before January 1, 2010.''.
            (4) Credit rate.--Subparagraph (A) of section 45(b)(4) is 
        amended by striking ``or (9)'' and inserting ``(9), or (11)''.
            (5) Coordination with small irrigation power.--Paragraph 
        (5) of section 45(d), as amended by subsection (a), is amended 
        by striking ``January 1, 2010'' and inserting ``the date of the 
        enactment of paragraph (11)''.
    (c) Sales of Electricity to Regulated Public Utilities Treated as 
Sales to Unrelated Persons.--Section 45(e)(4) (relating to related 
persons) is amended by adding at the end the following new sentence: 
``A taxpayer shall be treated as selling electricity to an unrelated 
person if such electricity is sold to a regulated public utility (as 
defined in section 7701(a)(33).''.
    (d) Trash Facility Clarification.--Paragraph (7) of section 45(d) 
is amended--
            (1) by striking ``facility which burns'' and inserting 
        ``facility (other than a facility described in paragraph (6)) 
        which uses'', and
            (2) by striking ``combustion''.
    (e) Effective Dates.--
            (1) Extension.--The amendments made by subsection (a) shall 
        apply to property originally placed in service after December 
        31, 2008.
            (2) Modifications.--The amendments made by subsections (b) 
        and (c) shall apply to electricity produced and sold after the 
        date of the enactment of this Act, in taxable years ending 
        after such date.
            (3) Trash facility clarification.--The amendments made by 
        subsection (d) shall apply to electricity produced and sold 
        before, on, or after December 31, 2007.

SEC. 502. EXTENSION AND MODIFICATION OF SOLAR ENERGY AND FUEL CELL 
              INVESTMENT TAX CREDIT.

    (a) Extension of Credit.--
            (1) Solar energy property.--Paragraphs (2)(A)(i)(II) and 
        (3)(A)(ii) of section 48(a) (relating to energy credit) are 
        each amended by striking ``January 1, 2009'' and inserting 
        ``January 1, 2017''.
            (2) Fuel cell property.--Subparagraph (E) of section 
        48(c)(1) (relating to qualified fuel cell property) is amended 
        by striking ``December 31, 2008'' and inserting ``December 31, 
        2017''.
            (3) Qualified microturbine property.--Subparagraph (E) of 
        section 48(c)(2) (relating to qualified microturbine property) 
        is amended by striking ``December 31, 2008'' and inserting 
        ``December 31, 2017''.
    (b) Allowance of Energy Credit Against Alternative Minimum Tax.--
Subparagraph (B) of section 38(c)(4) (relating to specified credits) is 
amended by striking ``and'' at the end of clause (iii), by striking the 
period at the end of clause (iv) and inserting ``, and'', and by adding 
at the end the following new clause:
                            ``(v) the credit determined under section 
                        46 to the extent that such credit is 
                        attributable to the energy credit determined 
                        under section 48.''.
    (c) Repeal of Dollar Per Kilowatt Limitation for Fuel Cell 
Property.--
            (1) In general.--Section 48(c)(1) (relating to qualified 
        fuel cell), as amended by subsection (a)(2), is amended by 
        striking subparagraph (B) and by redesignating subparagraphs 
        (C), (D), and (E) as subparagraphs (B), (C), and (D), 
        respectively.
            (2) Conforming amendment.--Section 48(a)(1) is amended by 
        striking ``paragraphs (1)(B) and (2)(B) of subsection (c)'' and 
        inserting ``subsection (c)(2)(B)''.
    (d) Public Electric Utility Property Taken Into Account.--
            (1) In general.--Paragraph (3) of section 48(a) is amended 
        by striking the second sentence thereof.
            (2) Conforming amendments.--
                    (A) Paragraph (1) of section 48(c), as amended by 
                this section, is amended by striking subparagraph (C) 
                and redesignating subparagraph (D) as subparagraph (C).
                    (B) Paragraph (2) of section 48(c), as amended by 
                subsection (a)(3), is amended by striking subparagraph 
                (D) and redesignating subparagraph (E) as subparagraph 
                (D).
    (e) Effective Dates.--
            (1) Extension.--The amendments made by subsection (a) shall 
        take effect on the date of the enactment of this Act.
            (2) Allowance against alternative minimum tax.--The 
        amendments made by subsection (b) shall apply to credits 
        determined under section 46 of the Internal Revenue Code of 
        1986 in taxable years beginning after the date of the enactment 
        of this Act and to carrybacks of such credits.
            (3) Fuel cell property and public electric utility 
        property.--The amendments made by subsections (c) and (d) shall 
        apply to periods after the date of the enactment of this Act, 
        in taxable years ending after such date, under rules similar to 
        the rules of section 48(m) of the Internal Revenue Code of 1986 
        (as in effect on the day before the date of the enactment of 
        the Revenue Reconciliation Act of 1990).

SEC. 503. EXTENSION AND MODIFICATION OF RESIDENTIAL ENERGY EFFICIENT 
              PROPERTY CREDIT.

    (a) Extension.--Section 25D(g) (relating to termination) is amended 
by striking ``December 31, 2008'' and inserting ``December 31, 2009''.
    (b) No Dollar Limitation for Credit for Solar Electric Property.--
            (1) In general.--Section 25D(b)(1) (relating to maximum 
        credit) is amended by striking subparagraph (A) and by 
        redesignating subparagraphs (B) and (C) as subparagraphs (A) 
        and (B), respectively.
            (2) Conforming amendments.--Section 25D(e)(4) is amended--
                    (A) by striking clause (i) in subparagraph (A),
                    (B) by redesignating clauses (ii) and (iii) in 
                subparagraph (A) as clauses (i) and (ii), respectively, 
                and
                    (C) by striking ``, (2),'' in subparagraph (C).
    (c) Credit Allowed Against Alternative Minimum Tax.--
            (1) In general.--Subsection (c) of section 25D is amended 
        to read as follows:
    ``(c) Limitation Based on Amount of Tax; Carryforward of Unused 
Credit.--
            ``(1) Limitation based on amount of tax.--In the case of a 
        taxable year to which section 26(a)(2) does not apply, the 
        credit allowed under subsection (a) for the taxable year shall 
        not exceed the excess of--
                    ``(A) the sum of the regular tax liability (as 
                defined in section 26(b)) plus the tax imposed by 
                section 55, over
                    ``(B) the sum of the credits allowable under this 
                subpart (other than this section) and section 27 for 
                the taxable year.
            ``(2) Carryforward of unused credit.--
                    ``(A) Rule for years in which all personal credits 
                allowed against regular and alternative minimum tax.--
                In the case of a taxable year to which section 26(a)(2) 
                applies, if the credit allowable under subsection (a) 
                exceeds the limitation imposed by section 26(a)(2) for 
                such taxable year reduced by the sum of the credits 
                allowable under this subpart (other than this section), 
                such excess shall be carried to the succeeding taxable 
                year and added to the credit allowable under subsection 
                (a) for such succeeding taxable year.
                    ``(B) Rule for other years.--In the case of a 
                taxable year to which section 26(a)(2) does not apply, 
                if the credit allowable under subsection (a) exceeds 
                the limitation imposed by paragraph (1) for such 
                taxable year, such excess shall be carried to the 
                succeeding taxable year and added to the credit 
                allowable under subsection (a) for such succeeding 
                taxable year.''.
            (2) Conforming amendments.--
                    (A) Section 23(b)(4)(B) is amended by inserting 
                ``and section 25D'' after ``this section''.
                    (B) Section 24(b)(3)(B) is amended by striking 
                ``and 25B'' and inserting ``, 25B, and 25D''.
                    (C) Section 25B(g)(2) is amended by striking 
                ``section 23'' and inserting ``sections 23 and 25D''.
                    (D) Section 26(a)(1) is amended by striking ``and 
                25B'' and inserting ``25B, and 25D''.
    (d) Effective Date.--
            (1) In general.--The amendments made by this section shall 
        apply to taxable years beginning after December 31, 2007.
            (2) Application of egtrra sunset.--The amendments made by 
        subparagraphs (A) and (B) of subsection (c)(2) shall be subject 
        to title IX of the Economic Growth and Tax Relief 
        Reconciliation Act of 2001 in the same manner as the provisions 
        of such Act to which such amendments relate.

SEC. 504. EXTENSION AND MODIFICATION OF CREDIT FOR CLEAN RENEWABLE 
              ENERGY BONDS.

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

SEC. 505. EXTENSION OF SPECIAL RULE TO IMPLEMENT FERC RESTRUCTURING 
              POLICY.

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

     PART II--EXTENSION OF INCENTIVES TO IMPROVE ENERGY EFFICIENCY

SEC. 511. EXTENSION AND MODIFICATION OF CREDIT FOR ENERGY EFFICIENCY 
              IMPROVEMENTS TO EXISTING HOMES.

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

SEC. 512. EXTENSION AND MODIFICATION OF TAX CREDIT FOR ENERGY EFFICIENT 
              NEW HOMES.

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

SEC. 513. EXTENSION AND MODIFICATION OF ENERGY EFFICIENT COMMERCIAL 
              BUILDINGS DEDUCTION.

    (a) Extension.--Section 179D(h) (relating to termination) is 
amended by striking ``December 31, 2008'' and inserting ``December 31, 
2009''.
    (b) Adjustment of Maximum Deduction Amount.--
            (1) In general.--Subparagraph (A) of section 179D(b)(1) 
        (relating to maximum amount of deduction) is amended by 
        striking ``$1.80'' and inserting ``$2.25''.
            (2) Partial allowance.--Paragraph (1) of section 179D(d) is 
        amended--
                    (A) by striking ``$.60'' and inserting ``$0.75'', 
                and
                    (B) by striking ``$1.80'' and inserting ``$2.25''.
    (c) Effective Date.--The amendments made by this section shall 
apply to property placed in service after the date of the enactment of 
this Act.

SEC. 514. MODIFICATION AND EXTENSION OF ENERGY EFFICIENT APPLIANCE 
              CREDIT FOR APPLIANCES PRODUCED AFTER 2007.

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

                  Subtitle B--Mineral Royalty Payments

SEC. 521. TERMINATION OF AUTHORITY TO DEDUCT AMOUNTS FROM SHARE OF OIL 
              AND GAS LEASING REVENUES PROVIDED TO STATES.

    (a) in General.--Effective December 26, 2007, the matter under the 
heading ``ADMINISTRATIVE PROVISIONS'' under the heading ``Minerals 
Management Service'' of title I of the Department of the Interior, 
Environment, and Related Agencies Appropriations Act, 2008 (Subdivision 
F of Public Law 110-161; 121 Stat. 2109) is amended by striking the 
second undesignated paragraph.
    (b) Administration.--Notwithstanding any other provision of law, 
the Secretary of the Treasury and the Secretary of the Interior shall 
not deduct any amount from or reduce the amount of payments otherwise 
payable to States under section 35 of the Mineral Leasing Act (30 
U.S.C. 191).

                 TITLE VI--COAL-TECHNOLOGY DEVELOPMENT

                      Subtitle A--Coal to Liquids

SEC. 601. DEFINITIONS.

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

SEC. 602. COAL-TO-LIQUID FUEL LOAN GUARANTEE PROGRAM.

    (a) Eligible Projects.--Section 1703(b) of the Energy Policy Act of 
2005 (42 U.S.C. 16513(b)) is amended by adding at the end the 
following:
            ``(11) Large-scale coal-to-liquid facilities (as defined in 
        section 601 of the Eight Steps to Energy Sufficiency Act of 
        2008) that use a feedstock, the majority of which is the coal 
        resources of the United States, to produce not less than 10,000 
        barrels a day of liquid transportation fuel.''.
    (b) Authorization of Appropriations.--Section 1704 of the Energy 
Policy Act of 2005 (42 U.S.C. 16514) is amended by adding at the end 
the following:
    ``(c) Coal-to-Liquid Projects.--
            ``(1) In general.--There are authorized to be appropriated 
        such sums as are necessary to provide the cost of guarantees 
        for projects involving large-scale coal-to-liquid facilities 
        under section 1703(b)(11).
            ``(2) Alternative funding.--If no appropriations are made 
        available under paragraph (1), an eligible applicant may elect 
        to provide payment to the Secretary, to be delivered if and at 
        the time the application is approved, in the amount of the 
        estimated cost of the loan guarantee to the Federal Government, 
        as determined by the Secretary.
            ``(3) Limitations.--
                    ``(A) In general.--No loan guarantees shall be 
                provided under this title for projects described in 
                paragraph (1) after (as determined by the Secretary)--
                            ``(i) the tenth such loan guarantee is 
                        issued under this title; or
                            ``(ii) production capacity covered by such 
                        loan guarantees reaches 100,000 barrels per day 
                        of coal-to-liquid fuel.
                    ``(B) Individual projects.--
                            ``(i) In general.--A loan guarantee may be 
                        provided under this title for any large-scale 
                        coal-to-liquid facility described in paragraph 
                        (1) that produces no more than 20,000 barrels 
                        of coal-to-liquid fuel per day.
                            ``(ii) Non-federal funding requirement.--To 
                        be eligible for a loan guarantee under this 
                        title, a large-scale coal-to-liquid facility 
                        described in paragraph (1) that produces more 
                        than 20,000 barrels per day of coal-to-liquid 
                        fuel shall be eligible to receive a loan 
                        guarantee for the proportion of the cost of the 
                        facility that represents 20,000 barrels of 
                        coal-to-liquid fuel per day of production.
            ``(4) Requirements.--
                    ``(A) Guidelines.--Not later than 180 days after 
                the date of enactment of this subsection, the Secretary 
                shall publish guidelines for the coal-to-liquids loan 
                guarantee application process.
                    ``(B) Applications.--Not later than 1 year after 
                the date of enactment of this subsection, the Secretary 
                shall begin to accept applications for coal-to-liquid 
                loan guarantees under this subsection.
                    ``(C) Deadline.--Not later than 1 year from the 
                date of acceptance of an application under subparagraph 
                (B), the Secretary shall evaluate the application and 
                make final determinations under this subsection.
            ``(5) Reports to congress.--The Secretary shall submit to 
        the Committee on Energy and Natural Resources of the Senate and 
        the Committee on Energy and Commerce of the House of 
        Representatives a report describing the status of the program 
        under this subsection not later than each of--
                    ``(A) 180 days after the date of enactment of this 
                subsection;
                    ``(B) 1 year after the date of enactment of this 
                subsection; and
                    ``(C) the dates on which the Secretary approves the 
                first and fifth applications for coal-to-liquid loan 
                guarantees under this subsection.''.

SEC. 603. COAL-TO-LIQUID FACILITIES LOAN PROGRAM.

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

SEC. 604. LOCATION OF COAL-TO-LIQUID MANUFACTURING FACILITIES.

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

SEC. 605. STRATEGIC PETROLEUM RESERVE.

    (a) Development, Operation, and Maintenance of Reserve.--Section 
159 of the Energy Policy and Conservation Act (42 U.S.C. 6239) is 
amended--
            (1) by redesignating subsections (f), (g), (j), (k), and 
        (l) as subsections (a), (b), (e), (f), and (g), respectively; 
        and
            (2) by inserting after subsection (b) (as redesignated by 
        paragraph (1)) the following:
    ``(c) Study of Maintaining Coal-to-Liquid Products in Reserve.--Not 
later than 1 year after the date of enactment of the Eight Steps to 
Energy Sufficiency Act of 2008, the Secretary and the Secretary of 
Defense shall--
            ``(1) conduct a study of the feasibility and suitability of 
        maintaining coal-to-liquid products in the Reserve; and
            ``(2) submit to the Committee on Energy and Natural 
        Resources and the Committee on Armed Services of the Senate and 
        the Committee on Energy and Commerce and the Committee on Armed 
        Services of the House of Representatives a report describing 
        the results of the study.
    ``(d) Construction of Storage Facilities.--As soon as practicable 
after the date of enactment of the Eight Steps to Energy Sufficiency 
Act of 2008, the Secretary may construct 1 or more storage facilities 
in the vicinity of pipeline infrastructure and at least 1 military 
base.''.
    (b) Petroleum Products for Storage in Reserve.--Section 160 of the 
Energy Policy and Conservation Act (42 U.S.C. 6240) is amended--
            (1) in subsection (a)--
                    (A) in paragraph (1), by inserting a semicolon at 
                the end;
                    (B) in paragraph (2), by striking ``and'' at the 
                end;
                    (C) in paragraph (3), by striking the period at the 
                end and inserting ``; and''; and
                    (D) by adding at the end the following:
            ``(4) coal-to-liquid products (as defined in section 601 of 
        the Eight Steps to Energy Sufficiency Act of 2008), as the 
        Secretary determines to be appropriate, in a quantity not to 
        exceed 20 percent of the total quantity of petroleum and 
        petroleum products in the Reserve.'';
            (2) in subsection (b), by redesignating paragraphs (3) 
        through (5) as paragraphs (2) through (4), respectively; and
            (3) by redesignating subsections (f) and (h) as subsections 
        (d) and (e), respectively.
    (c) Conforming Amendments.--Section 167 of the Energy Policy and 
Conservation Act (42 U.S.C. 6247) is amended--
            (1) in subsection (b)--
                    (A) by redesignating paragraphs (2) and (3) as 
                paragraphs (1) and (2), respectively; and
                    (B) in paragraph (2) (as redesignated by 
                subparagraph (A)), by striking ``section 160(f)'' and 
                inserting ``section 160(e)''; and
            (2) in subsection (d), in the matter preceding paragraph 
        (1), by striking ``section 160(f)'' and inserting ``section 
        160(e)''.

SEC. 606. AUTHORIZATION TO CONDUCT RESEARCH, DEVELOPMENT, TESTING, AND 
              EVALUATION OF ASSURED DOMESTIC FUELS.

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

SEC. 607. COAL-TO-LIQUID LONG-TERM FUEL PROCUREMENT AND DEPARTMENT OF 
              DEFENSE DEVELOPMENT.

    Section 2922d of title 10, United States Code, is amended--
            (1) in subsection (b)--
                    (A) by striking ``The Secretary'' and inserting the 
                following:
            ``(1) In general.--The Secretary''; and
                    (B) by adding at the end the following:
            ``(2) Coal-to-liquid production facilities.--
                    ``(A) In general.--The Secretary of Defense may 
                enter into contracts or other agreements with private 
                companies or other entities to develop and operate 
                coal-to-liquid facilities (as defined in section 601 of 
                the Eight Steps to Energy Sufficiency Act of 2008) on 
                or near military installations.
                    ``(B) Considerations.--In entering into contracts 
                and other agreements under subparagraph (A), the 
                Secretary shall consider land availability, testing 
                opportunities, and proximity to raw materials.'';
            (2) in subsection (d)--
                    (A) by striking ``Subject to applicable provisions 
                of law, any'' and inserting ``Any''; and
                    (B) by striking ``1 or more years'' and inserting 
                ``up to 25 years''; and
            (3) by adding at the end the following:
    ``(f) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as are necessary to carry out this section.''.

SEC. 608. REPORT ON EMISSIONS OF FISCHER-TROPSCH PRODUCTS USED AS 
              TRANSPORTATION FUELS.

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

       Subtitle B--Tax Incentives for Coal-to-Liquids Production

SEC. 611. CREDIT FOR INVESTMENT IN COAL-TO-LIQUID FUELS PROJECTS.

    (a) In General.--Section 46 of the Internal Revenue Code of 1986 
(relating to amount of credit) is amended by striking ``and'' at the 
end of paragraph (3), by striking the period at the end of paragraph 
(4) and inserting ``, and'', and by adding at the end the following new 
paragraph:
            ``(5) the qualifying coal-to-liquid fuels project 
        credit.''.
    (b) Amount of Credit.--Subpart E of part IV of subchapter A of 
chapter 1 of the Internal Revenue Code of 1986 (relating to rules for 
computing investment credit) is amended by inserting after section 48B 
the following new section:

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

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

``Sec. 48C. Qualifying coal-to-liquid fuels project credit.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to periods after the date of the enactment of this Act, under 
rules similar to the rules of section 48(m) of the Internal Revenue 
Code of 1986 (as in effect on the day before the date of the enactment 
of the Revenue Reconciliation Act of 1990).

SEC. 612. TEMPORARY EXPENSING FOR EQUIPMENT USED IN COAL-TO-LIQUID 
              FUELS PROCESS.

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

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

    ``(a) Treatment as Expenses.--A taxpayer may elect to treat the 
cost of any qualified coal-to-liquid fuels process property as an 
expense which is not chargeable to capital account. Any cost so treated 
shall be allowed as a deduction for the taxable year in which the 
expense is incurred.
    ``(b) Election.--
            ``(1) In general.--An election under this section for any 
        taxable year shall be made on the taxpayer's return of the tax 
        imposed by this chapter for the taxable year. Such election 
        shall be made in such manner as the Secretary may by 
        regulations prescribe.
            ``(2) Election irrevocable.--Any election made under this 
        section may not be revoked except with the consent of the 
        Secretary.
    ``(c) Qualified Coal-to-Liquid Fuels Process Property.--The term 
`qualified coal-to-liquid fuels process property' means any property 
located in the United States--
            ``(1) which employs the Fischer-Tropsch process to produce 
        transportation grade liquid fuels from a feedstock that is 
        primarily domestic coal (including any property which allows 
        for the capture, transportation, or sequestration of by-
        products resulting from such process, including carbon 
        emissions);
            ``(2) the original use of which commences with the 
        taxpayer;
            ``(3) the construction of which--
                    ``(A) except as provided in subparagraph (B), is 
                subject to a binding construction contract entered into 
                after the date of the enactment of this section and 
                before January 1, 2011, but only if there was no 
                written binding construction contract entered into on 
                or before such date of enactment; or
                    ``(B) in the case of self-constructed property, 
                began after the date of the enactment of this section 
                and before January 1, 2011; and
            ``(4) which is placed in service by the taxpayer after the 
        date of the enactment of this section and before January 1, 
        2016.
    ``(d) Election To Allocate Deduction to Cooperative Owner.--If--
            ``(1) a taxpayer to which subsection (a) applies is an 
        organization to which part I of subchapter T applies; and
            ``(2) one or more persons directly holding an ownership 
        interest in the taxpayer are organizations to which part I of 
        subchapter T apply, the taxpayer may elect to allocate all or a 
        portion of the deduction allowable under subsection (a) to such 
        persons. Such allocation shall be equal to the person's ratable 
        share of the total amount allocated, determined on the basis of 
        the person's ownership interest in the taxpayer. The taxable 
        income of the taxpayer shall not be reduced under section 1382 
        by reason of any amount to which the preceding sentence 
        applies.
    ``(e) Basis Reduction.--
            ``(1) In general.--For purposes of this title, if a 
        deduction is allowed under this section with respect to any 
        qualified coal-to-liquid fuels process property, the basis of 
        such property shall be reduced by the amount of the deduction 
        so allowed.
            ``(2) Ordinary income recapture.--For purposes of section 
        1245, the amount of the deduction allowable under subsection 
        (a) with respect to any property which is of a character 
        subject to the allowance for depreciation shall be treated as a 
        deduction allowed for depreciation under section 167.
    ``(f) Application With Other Deductions and Credits.--
            ``(1) Other deductions.--No deduction shall be allowed 
        under any other provision of this chapter with respect to any 
        expenditure with respect to which a deduction is allowed under 
        subsection (a) to the taxpayer.
            ``(2) Credits.--No credit shall be allowed under section 38 
        with respect to any amount for which a deduction is allowed 
        under subsection (a).
    ``(g) Reporting.--No deduction shall be allowed under subsection 
(a) to any taxpayer for any taxable year unless such taxpayer files 
with the Secretary a report containing such information with respect to 
the operation of the property of the taxpayer as the Secretary shall 
require.''.
    (b) Conforming Amendments.--
            (1) Section 1016(a) of the Internal Revenue Code of 1986, 
        as amended by this Act, is amended by striking ``and'' at the 
        end of paragraph (36), by striking the period at the end of 
        paragraph (37) and inserting ``, and'', and by adding at the 
        end the following new paragraph:
            ``(38) to the extent provided in section 179E(e)(1).''.
            (2) Section 1245(a) of such Code is amended by inserting 
        ``179E,'' after ``179D,'' both places it appears in paragraphs 
        (2)(C) and (3)(C).
            (3) Section 263(a)(1) of such Code is amended by striking 
        ``or'' at the end of subparagraph (J), by striking the period 
        at the end of subparagraph (K) and inserting ``, or'', and by 
        inserting after subparagraph (K) the following new 
        subparagraph:
                    ``(L) expenditures for which a deduction is allowed 
                under section 179E.''.
            (4) Section 312(k)(3)(B) of such Code is amended by 
        striking ``or 179D'' each place it appears in the heading and 
        text and inserting ``179D, or 179E''.
            (5) The table of sections for part VI of subchapter B of 
        chapter 1 of such Code is amended by inserting after the item 
        relating to section 179D the following new item:

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

SEC. 613. EXTENSION OF ALTERNATIVE FUEL CREDIT FOR FUEL DERIVED FROM 
              COAL THROUGH THE FISCHER-TROPSCH PROCESS.

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

SEC. 614. MODIFICATIONS TO ENHANCED OIL RECOVERY CREDIT.

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

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

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

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

SEC. 615. ALLOWANCE OF ENHANCED OIL, NATURAL GAS, AND COALBED METHANE 
              RECOVERY, AND CAPTURE AND SEQUESTRATION CREDIT AGAINST 
              THE ALTERNATIVE MINIMUM TAX.

    (a) In General.--Subsection (c) of section 38 of the Internal 
Revenue Code of 1986 (relating to limitation based on amount of tax) is 
amended by redesignating paragraphs (4) and (5) as paragraphs (5) and 
(6), respectively, and by inserting after paragraph (3) the following 
new paragraph:
            ``(4) Special rules for enhanced oil, natural gas, and 
        coalbed methane recovery, and capture and sequestration 
        credit.--In the case of the enhanced oil, natural gas, and 
        coalbed methane recovery, and capture and sequestration credit 
        determined under section 43--
                    ``(A) this section and section 39 shall be applied 
                separately with respect to such credit; and
                    ``(B) in applying paragraph (1) to such credit--
                            ``(i) the tentative minimum tax shall be 
                        treated as being zero; and
                            ``(ii) the limitation under paragraph (1) 
                        (as modified by clause (i)) shall be reduced by 
                        the credit allowed under subsection (a) for the 
                        taxable year (other than the enhanced oil, 
                        natural gas, and coalbed methane recovery, and 
                        capture and sequestration credit and the 
                        specified credits).''.
    (b) Conforming Amendments.--
            (1) Section 38(c)(2)(A)(ii)(II) of the Internal Revenue 
        Code of 1986 is amended by inserting ``the enhanced oil, 
        natural gas, and coalbed methane recovery, and capture and 
        sequestration credit,'' after ``employee credit,''.
            (2) Section 38(c)(3)(A)(ii)(II) of such Code is amended by 
        inserting ``, the enhanced oil, natural gas, coalbed methane 
        recovery, capture and sequestration credit,'' after ``employee 
        credit''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after December 31, 2007.

              Subtitle C--Clean Coal Technology Deployment

SEC. 621. CARBON SEQUESTRATION AND CAPTURE.

    (a) Definitions.--In this section:
            (1) Anthropogenic.--The term ``anthropogenic'' means 
        produced or caused by human activity.
            (2) Carbon dioxide.--The term ``carbon dioxide'' means 
        anthropogenically sourced carbon dioxide that is of sufficient 
        purity and quality as to not compromise the safety and 
        efficiency of any reservoir in which the carbon dioxide is 
        stored.
            (3) Federal agency.--The term ``Federal agency'' means any 
        department, agency, or instrumentality of the United States.
            (4) Geological storage.--The term ``geological storage'' 
        means permanent or short-term underground storage of carbon 
        dioxide in a reservoir.
            (5) Person.--
                    (A) In general.--The term ``person'' means an 
                individual, corporation, company (including a limited 
                liability company), association, partnership, State, 
                municipality, or Federal agency.
                    (B) Inclusions.--The term ``person'' includes an 
                officer, employee, and agent of any corporation, 
                company (including a limited liability company), 
                association, partnership, State, municipality, or 
                Federal agency.
            (6) Reservoir.--
                    (A) In general.--The term ``reservoir'' means any 
                subsurface sedimentary stratum, formation, aquifer, or 
                cavity or void (whether natural or artificially 
                created) that is suitable for, or capable of being made 
                suitable for, the injection and storage of carbon 
                dioxide.
                    (B) Inclusions.--The term ``reservoir'' includes--
                            (i) an oil and gas reservoir;
                            (ii) a saline formation or coal seam; and
                            (iii) the seabed and subsoil of a submarine 
                        area.
            (7) State.--
                    (A) In general.--The term ``State'' means--
                            (i) each of the several States of the 
                        United States;
                            (ii) the District of Columbia;
                            (iii) the Commonwealth of Puerto Rico;
                            (iv) Guam;
                            (v) American Samoa;
                            (vi) the Commonwealth of the Northern 
                        Mariana Islands;
                            (vii) the Federated States of Micronesia;
                            (viii) the Republic of the Marshall 
                        Islands;
                            (ix) the Republic of Palau; and
                            (x) the United States Virgin Islands.
                    (B) Inclusions.--The term ``State'' includes all 
                territorial water, seabed, and subsoil of submarine 
                areas of each State.
            (8) State regulatory agency.--The term ``State regulatory 
        agency'' means the agency designated by the Governor of a State 
        to administer a carbon dioxide storage program of the State.
            (9) Storage facility.--
                    (A) In general.--The term ``storage facility'' 
                means--
                            (i) an underground reservoir, underground 
                        equipment, and surface structures and equipment 
                        used in an operation to store carbon dioxide in 
                        a reservoir; and
                            (ii) any other facilities that the 
                        Administrator may include by regulation or 
                        permit.
                    (B) Exclusions.--The term ``storage facility'' does 
                not include pipelines used to transport the carbon 
                dioxide from 1 or more capture facilities to the 
                storage and injection site.
            (10) Storage operator.--The term ``storage operator'' means 
        any person or other entity authorized by the Administrator or 
        State regulatory agency to operate a storage facility.
            (11) Underground reservoir.--The term ``underground 
        reservoir'', with respect to a storage facility, includes any 
        necessary and reasonable areal buffer and subsurface monitoring 
        zones that are--
                    (A) designated by the Administrator or State 
                regulatory agency for the purpose of ensuring the safe 
                and efficient operation of the storage facility for the 
                storage of carbon dioxide; and
                    (B) selected to protect against pollution, 
                invasion, and escape or migration of the stored carbon 
                dioxide.
    (b) State Carbon Dioxide Geological Storage Programs.--
            (1) Regulations.--
                    (A) In general.--The Administrator shall--
                            (i) not later than 180 days after the date 
                        of enactment of this Act, publish in the 
                        Federal Register proposed regulations for State 
                        carbon dioxide storage programs; and
                            (ii) not later than 180 days after the date 
                        of publication of the proposed regulations 
                        under clause (i), promulgate final regulations 
                        for State carbon dioxide storage programs that 
                        meet the requirements described in paragraph 
                        (2)(A), including such modifications as the 
                        Administrator determines to be appropriate.
                    (B) Updating.--The Administrator may periodically 
                review and, as necessary, revise the regulations 
                promulgated under this subsection.
            (2) State regulatory authority.--
                    (A) In general.--The regulations promulgated under 
                paragraph (1)(A)(ii) shall establish minimum 
                requirements that States shall meet in order to be 
                approved to administer a carbon dioxide storage program 
                under subsection (c)(1), including--
                            (i) a prohibition on carbon dioxide storage 
                        in the State that is not authorized by a permit 
                        issued by the State;
                            (ii) inspection, monitoring, recordkeeping, 
                        and reporting requirements; and
                            (iii) authority for the State regulatory 
                        agency to issue a permit, after public notice 
                        and hearing, approving a storage facility for 
                        the proposed geological storage of carbon 
                        dioxide if the State regulatory authority 
                        determines that--
                                    (I) the horizontal and vertical 
                                boundaries of the geological storage 
                                facility designated by the permit are 
                                appropriate for the storage facility;
                                    (II) the storage facility and 
                                reservoir are suitable and feasible for 
                                the injection and storage of carbon 
                                dioxide;
                                    (III) a good faith effort has been 
                                made to obtain the consent of a 
                                majority of the owners having property 
                                interests affected by the storage 
                                facility, and that the storage operator 
                                intends to acquire any remaining 
                                interest by eminent domain or by a 
                                method otherwise allowed by law;
                                    (IV) the use of the storage 
                                facility for the geological storage of 
                                carbon dioxide will not result in the 
                                unpermitted migration of carbon dioxide 
                                into other formations containing fresh 
                                drinking water or oil, gas, coal, or 
                                other commercial mineral deposits that 
                                are not owned by the storage operator; 
                                and
                                    (V) the proposed storage would--
                                            (aa) not unduly endanger 
                                        human health or the 
                                        environment; and
                                            (bb) be in the public 
                                        interest.
                    (B) State authority.--A State regulatory agency 
                approved under subsection (c)(1) to administer a carbon 
                dioxide storage program shall issue such orders, 
                permits, certificates, rules, and regulations, 
                including establishment of such appropriate and 
                sufficient financial sureties as are necessary, for the 
                purpose of regulating the drilling, operation, and well 
                plugging and abandonment and removal of surface 
                buildings and equipment of the storage facility in 
                order to protect the storage facility against 
                pollution, invasion, and the escape or migration of 
                carbon dioxide.
                    (C) Eminent domain.--A storage operator may be 
                empowered by a State to exercise the right of eminent 
                domain under State law to acquire all surface and 
                subsurface rights and interests necessary or useful for 
                the purpose of operating the storage facility, 
                including easements and rights-of-way across land that 
                are necessary to transport carbon dioxide among 
                components of the storage facility.
                    (D) Variance in conditions.--The regulations 
                promulgated under paragraph (1)(A)(ii) shall permit or 
                provide for consideration of varying geological, 
                hydrological, and historical conditions in different 
                States and in different areas within a State.
                    (E) Enhanced recovery operations.--
                            (i) In general.--Upon the approval of a 
                        State to administer a carbon dioxide storage 
                        program under subsection (c)(1), the State 
                        regulatory agency designated by the State may 
                        develop rules to allow the conversion into a 
                        storage facility of an enhanced recovery 
                        operation that is in existence as of the date 
                        on which administration of the program by the 
                        State is approved.
                            (ii) Oil and gas recovery.--Nothing in this 
                        section applies to or otherwise affects the use 
                        of carbon dioxide as a part of or in 
                        conjunction with any enhanced recovery method 
                        the sole purpose of which is enhanced oil or 
                        gas recovery.
    (c) State Primary Enforcement Responsibility.--
            (1) Approval of state carbon dioxide storage programs.--
                    (A) Application.--
                            (i) In general.--After promulgation of the 
                        regulations under subsection (b)(1)(A)(ii), 
                        each State may submit to the Administrator an 
                        application that demonstrates, to the 
                        satisfaction of the Administrator, that the 
                        State--
                                    (I) has adopted, after providing 
                                for reasonable notice and an 
                                opportunity for public comment, and 
                                will implement, a carbon dioxide 
                                storage program that meets the 
                                requirements of the regulations; and
                                    (II) will keep such records and 
                                make such reports with respect to the 
                                activities of the State under the 
                                carbon dioxide storage program as the 
                                Administrator may require by 
                                regulation.
                            (ii) Revisions.--Not later than the 
                        expiration of the 270-day period beginning on 
                        the date on which any regulation promulgated 
                        under subsection (b)(1)(A)(ii) is revised or 
                        amended with respect to a requirement 
                        applicable to State carbon dioxide storage 
                        programs, each State with a carbon dioxide 
                        storage program approved under subparagraph (B) 
                        shall submit, in such form and in such manner 
                        as the Administrator may require, a notice to 
                        the Administrator that demonstrates, to the 
                        satisfaction of the Administrator, that the 
                        State carbon dioxide storage program meets the 
                        revised or amended requirement.
                    (B) Approval or disapproval.--Not later than 90 
                days after the date on which a State submits to the 
                Administrator an application under subparagraph (A)(i) 
                or a notice under subparagraph (A)(ii), and after a 
                reasonable (as determined by the Administrator) 
                opportunity for discussion, the Administrator shall by 
                regulation approve, disapprove, or approve in part and 
                disapprove in part, the carbon dioxide storage program 
                proposed by the State.
                    (C) Effect of approval.--If the Administrator 
                approves the carbon dioxide storage program of a State 
                under subparagraph (B), the State shall have primary 
                enforcement responsibility for carbon dioxide storage 
                in the State until such time as the Administrator 
                determines, by regulation, that the State no longer 
                meets the requirements of subparagraph (A)(i).
                    (D) Public participation.--Before making a 
                determination under subparagraph (B) or (C), the 
                Administrator shall provide an opportunity for a public 
                hearing with respect to the determination.
            (2) States without primary enforcement responsibility.--
                    (A) In general.--If a State fails to submit an 
                application under paragraph (1)(A)(i) by the date that 
                is 270 days after the date of promulgation of 
                regulations under subsection (b)(1)(A)(ii), the 
                Administrator shall by regulation prescribe (and may 
                from time to time by regulation revise) a program 
                applicable to the State that meets the terms and 
                conditions of subsection (b)(2).
                    (B) Disapproval.--If the Administrator disapproves 
                all or a portion of the program of a State under 
                paragraph (1)(B), if the Administrator determines under 
                paragraph (1)(C) that a State no longer meets the 
                requirements of subclause (I) or (II) of paragraph 
                (1)(A)(i), or if a State fails to submit a notice 
                before the expiration of the period specified in 
                paragraph (1)(A)(ii), the Administrator shall by 
                regulation, not later than 90 days after the date of 
                the disapproval, determination, or expiration (as the 
                case may be), prescribe (and may from time to time by 
                regulation revise) a program applicable to the State 
                that meets the requirements of subsection (b)(2).
                    (C) Applicability.--A program prescribed by the 
                Administrator under subparagraph (B) shall apply in a 
                State only to the extent that a program adopted by the 
                State that the Administrator determines meets the 
                requirements of this section or subsection (b)(2) is 
                not in effect.
                    (D) Public participation.--Before promulgating any 
                regulation under subparagraph (B) or (C), the 
                Administrator shall provide an opportunity for a public 
                hearing with respect to the regulation.
    (d) Enforcement of Program.--
            (1) Notification.--
                    (A) In general.--In any case in which the 
                Administrator determines, during a period during which 
                a State has primary enforcement responsibility for 
                carbon dioxide storage, that any person who is subject 
                to a requirement of the carbon dioxide storage program 
                is violating the requirement, the Administrator shall 
                notify the State and the person violating the 
                requirement of the violation.
                    (B) Failure to enforce.--If, after the date that is 
                30 days after the Administrator notifies a State of a 
                violation under subparagraph (A), the State has not 
                commenced appropriate enforcement action, the 
                Administrator shall--
                            (i) issue an order under paragraph (2) 
                        requiring the person to--
                                    (I) correct the matter; and
                                    (II) comply with the requirement; 
                                or
                            (ii) bring a civil action in accordance 
                        with paragraph (3).
                    (C) Violations in certain states.--In any case in 
                which the Administrator determines, during a period 
                during which a State does not have primary enforcement 
                responsibility for carbon dioxide storage, that any 
                person subject to any requirement of any applicable 
                carbon dioxide storage program in the State is 
                violating the requirement, the Administrator shall--
                            (i) issue an order under paragraph (2) 
                        requiring the person to comply with 
                        requirement; or
                            (ii) bring a civil action in accordance 
                        with paragraph (3).
            (2) Administrative orders and appeals.--
                    (A) In general.--In any case in which the 
                Administrator has the authority to bring a civil action 
                under this subsection with respect to any regulation or 
                other requirement of this section, the Administrator 
                may, in addition to bringing the civil action, issue an 
                order under this paragraph that--
                            (i) assesses a civil penalty of not more 
                        than $10,000 for each day of violation for any 
                        past or current violation, up to a maximum 
                        aggregate civil penalty of $125,000, for each 
                        covered entity;
                            (ii) requires compliance with the 
                        regulation or other requirement; or
                            (iii) accomplishes each of the actions 
                        described in clauses (i) and (ii).
                    (B) Timing.--An order under this paragraph shall be 
                issued by the Administrator only after an opportunity 
                (provided in accordance with this paragraph) for a 
                hearing.
                    (C) Notice.--Before issuing any order under 
                subparagraph (A), the Administrator shall provide to 
                the person to whom the order applies--
                            (i) written notice of the intent of the 
                        Administrator to issue the order; and
                            (ii) the opportunity to request, within the 
                        30-day period beginning on the date of receipt 
                        by the person of the notice, a hearing on the 
                        order.
                    (D) Requirements.--A hearing described in 
                subparagraph (C)(ii)--
                            (i) shall not be subject to section 554 or 
                        556 of title 5, United States Code; but
                            (ii) shall provide to each interested 
                        person a reasonable opportunity to be heard and 
                        to present evidence.
                    (E) Notice and comment.--The Administrator shall 
                provide public notice of, and a reasonable opportunity 
                to comment on, any proposed order.
                    (F) Specific notice.--Any person who comments on 
                any proposed order under subparagraph (E) shall be 
                given notice of any hearing under this paragraph and of 
                any order.
                    (G) Effective date.--Any order issued under this 
                paragraph shall become effective on the date that is 30 
                days after the date of issuance of the order, unless an 
                appeal is taken pursuant to subparagraph (K).
                    (H) Contents of order.--Any order issued under this 
                paragraph--
                            (i) shall state with reasonable specificity 
                        the nature of the violation; and
                            (ii) may specify a reasonable period to 
                        achieve compliance.
                    (I) Considerations.--In assessing any civil penalty 
                under this paragraph, the Administrator shall take into 
                consideration all appropriate factors, including--
                            (i) the seriousness of the violation;
                            (ii) the economic benefit (if any) 
                        resulting from the violation;
                            (iii) any history of similar violations;
                            (iv) any good-faith efforts to comply with 
                        the applicable requirements;
                            (v) the economic impact of the penalty on 
                        the violator; and
                            (vi) such other matters as justice may 
                        require.
                    (J) Other actions.--Any violation with respect to 
                which the Administrator has commenced and is diligently 
                prosecuting a civil action under a provision of law 
                other than this section, or has issued an order under 
                this paragraph assessing a civil penalty, shall not be 
                subject to a civil action under paragraph (3).
                    (K) Appeals.--Any person against whom an order is 
                issued may file an appeal of the order, not later than 
                30 days after the date of issuance of the order, with--
                            (i) the United States District Court for 
                        the District of Columbia; or
                            (ii) the United States district court for 
                        the district in which the violation is alleged 
                        to have occurred.
                    (L) Distribution of copies.--An appellant shall 
                simultaneously send a copy of an appeal filed under 
                subparagraph (K) by certified mail to the Administrator 
                and to the Attorney General.
                    (M) Record.--The Administrator shall promptly file 
                in the appropriate court described in subparagraph (K) 
                a certified copy of the record on which an order was 
                based.
                    (N) Judicial action.--A court having jurisdiction 
                over an order issued under this paragraph shall not--
                            (i) set aside or remand the order unless 
                        the court determines that--
                                    (I) there is not substantial 
                                evidence on the record, taken as a 
                                whole, to support the finding of a 
                                violation; or
                                    (II) the assessment by the 
                                Administrator of a civil penalty, or a 
                                requirement for compliance, constitutes 
                                an abuse of discretion; or
                            (ii) impose additional civil penalties for 
                        the same violation unless the court determines 
                        that the assessment by the Administrator of a 
                        civil penalty constitutes an abuse of 
                        discretion.
                    (O) Failure to pay.--
                            (i) In general.--If any person fails to pay 
                        an assessment of a civil penalty after an order 
                        becomes effective under subparagraph (G), or 
                        after a court, in a civil action brought under 
                        subparagraph (K), has entered a final judgment 
                        in favor of the Administrator, the 
                        Administrator may request the Attorney General 
                        to bring a civil action in an appropriate 
                        United States district court to recover the 
                        amount assessed, plus costs, attorneys' fees, 
                        and interest at currently prevailing rates, 
                        calculated from the date on which the order is 
                        effective or the date of the final judgment, as 
                        the case may be.
                            (ii) No review of amount.--In a civil 
                        action brought under clause (i), the validity, 
                        amount, and appropriateness of the civil 
                        penalty shall not be subject to review.
                    (P) Authority of administrator.--The Administrator 
                may, in connection with administrative proceedings 
                under this paragraph--
                            (i) issue subpoenas compelling the 
                        attendance and testimony of witnesses and 
                        subpoenas duces tecum; and
                            (ii) request the Attorney General to bring 
                        a civil action to enforce any subpoena issued 
                        under this subparagraph.
                    (Q) Enforcement.--The United States district courts 
                shall have jurisdiction to enforce, and impose 
                sanctions with respect to, subpoenas issued under 
                subparagraph (P).
            (3) Civil and criminal actions.--
                    (A) In general.--A civil action referred to in 
                subparagraph (B) or (C) of paragraph (1) shall be 
                brought in the appropriate United States district 
                court.
                    (B) Authority; judgement.--A court described in 
                subparagraph (A)--
                            (i) shall have jurisdiction to require 
                        compliance with any requirement of an 
                        applicable carbon dioxide storage program or 
                        with an order issued under paragraph (2); and
                            (ii) may enter such judgment as the 
                        protection of public health may require.
                    (C) Penalties.--Any person who violates any 
                requirement of an applicable carbon dioxide storage 
                program or an order requiring compliance under 
                paragraph (2)--
                            (i) shall be subject to a civil penalty of 
                        not more than $25,000 for each day of such 
                        violation; and
                            (ii) if the violation is willful, may, in 
                        addition to or in lieu of the civil penalty 
                        under clause (i), be imprisoned for not more 
                        than 3 years, fined in accordance with title 
                        18, United States Code, or both.
            (4) Effect on state authority.--
                    (A) In general.--Nothing in this subsection 
                diminishes or otherwise affects any authority of a 
                State or political subdivision of a State to adopt or 
                enforce any law (including a regulation) (relating to 
                the storage of carbon dioxide.
                    (B) Other requirements.--No law (including a 
                regulation) described in subparagraph (A) shall relieve 
                any person of any requirement otherwise applicable 
                under this Act.
    (e) Financial Assurances for Storage Operators.--
            (1) In general.--Each storage operator shall be required by 
        the State regulatory agency (in the case of a State with 
        primary enforcement authority) or the Administrator (in the 
        case of a State that does not have primary enforcement 
        authority) to have and maintain financial assurances of such 
        type and in such amounts as are necessary to cover public 
        liability claims relating to the storage facility of the 
        storage operator.
            (2) Maintenance of financial assurances.--The financial 
        assurances required under paragraph (1) shall be maintained by 
        the storage operator until such time as the operator obtains a 
        certificate of completion of injection operations under 
        subsection (f).
            (3) Amount.--The amount of financial assurances required 
        under paragraph (1) shall be the maximum amount of liability 
        insurance available at a reasonable cost and on reasonable 
        terms from private sources (including private insurance, 
        private contractual indemnities, self-insurance, or a 
        combination of those measures), as determined by the 
        Administrator.
    (f) Cessation of Storage Operations.--Upon a showing by a storage 
operator that a storage facility is reasonably expected to retain 
mechanical integrity and remain in place, the State regulatory agency 
(in the case of a State with primary enforcement authority) or the 
Administrator (in the case of a State that does not have primary 
enforcement authority) shall issue a certificate of completion of 
injection operations to the storage operator.
    (g) Liability of Storage Operators for Release of Carbon Dioxide.--
            (1) In general.--The Administrator shall agree to indemnify 
        and hold harmless a storage operator (and if different from the 
        storage operator, the owner of the storage facility) that has 
        maintained financial assurances under subsection (e) from 
        liability arising from the leakage of carbon dioxide at any 
        storage facility operated by the storage operator, to the 
        extent that the liability is in excess of the level of 
        financial protection required of the storage operator.
            (2) Completion of operations.--Upon the issuance of 
        certificate of completion of injection operations by a State 
        regulatory agency (in the case of a State with primary 
        enforcement authority) or the Administrator (in the case of a 
        State that does not have primary enforcement authority)--
                    (A) the Administrator shall be vested with complete 
                and absolute title and ownership of the storage 
                facility and any stored carbon dioxide at the facility;
                    (B) the storage operator and all generators of any 
                injected carbon dioxide shall be released from all 
                further liability associated with the project; and
                    (C)(i) any performance bonds posted by the storage 
                operator shall be released; and
                    (ii) continued monitoring of the storage facility, 
                including remediation of any well leakage, shall become 
                the responsibility of the Administrator.
    (h) Funding.--
            (1) In general.--For each fiscal year, the Administrator 
        shall collect an annual assessment from each storage operator 
        for each storage facility that has not obtained a certificate 
        of completion of injection operations.
            (2) Assessment amount.--The amount of the assessment for a 
        storage facility for a fiscal year shall be equal to the 
        product obtained by multiplying--
                    (A) the per-ton assessment for the fiscal year 
                calculated under paragraph (4); and
                    (B) the total number of tons of carbon dioxide 
                injected for storage by the storage operator during the 
                preceding fiscal year at all storage facilities 
                operated by the storage operator during the fiscal 
                year.
            (3) Aggregate amount.--The aggregate amount of assessments 
        collected from all storage operators under paragraph (1) for 
        any fiscal year shall be equal to the sum of, with respect to 
        the fiscal year--
                    (A) any indemnification payments required to be 
                made pursuant to subsection (g)(1);
                    (B) any costs associated with storage facilities to 
                which the Administrator has taken title pursuant to 
                subsection (g)(2), including costs associated with 
                any--
                            (i) inspection, monitoring, recordkeeping, 
                        and reporting requirements of those facilities;
                            (ii) remediation of carbon dioxide leakage; 
                        or
                            (iii) plugging and abandoning of remaining 
                        wells; and
                    (C) any costs associated with public liability of 
                storage facilities to which the Administrator has taken 
                title pursuant to subsection (g)(2).
            (4) Calculation of assessment.--The assessment under this 
        subsection per ton of carbon dioxide for a fiscal year shall be 
        equal to the quotient obtained by dividing--
                    (A) the aggregate amount of assessments calculated 
                under paragraph (3) for the fiscal year; by
                    (B) the aggregate number of tons of carbon dioxide 
                injected for storage during the preceding fiscal year 
                by all storage operators.
            (5) Information.--The Administrator shall require the 
        submission of such information by each storage operator on an 
        annual basis as is necessary to make the calculations required 
        under this subsection.
    (i) Relationship to Other Laws.--
            (1) In general.--The Administrator shall promulgate 
        regulations for permitting commercial-scale underground 
        injection of carbon dioxide for purposes of geological 
        sequestration under this section.
            (2) Safe drinking water act.--Section 1421 of the Safe 
        Drinking Water Act (42 U.S.C. 300h) shall not be used as a 
        basis for permitting commercial-scale underground injection or 
        storage of carbon dioxide.

  Subtitle D--Reduced Carbon Emissions Through Clean Coal Technologies

SEC. 631. STATEMENT OF POLICY.

    It is the policy of the United States to reduce carbon emissions 
from technology improvements to coal-fired power plants that will 
reduce the quantity of coal burned and carbon dioxide emitted per unit 
of power produced.

SEC. 632. CLEAN COAL RESEARCH AND DEVELOPMENT.

    (a) In General.--The Secretary shall expand and accelerate efforts 
to conduct research and develop technologies that reduce carbon dioxide 
emissions from coal-fired facilities with an emphasis on commercial 
viability and reliability.
    (b) Short-, Medium- and Long-Term Technology Areas.--The Secretary 
shall emphasize technologies that reduce carbon dioxide emissions in 
the short-, medium-, and long-term time frames, including--
            (1) innovations for existing power plants that reduce 
        carbon dioxide emissions by energy efficiency increases or by 
        capturing carbon emissions, including technologies that--
                    (A) reduce the quantity of fuel combusted per unit 
                of electricity output;
                    (B) reduce parasitic power loss from carbon control 
                technology;
                    (C) improve compression of the separated and 
                captured carbon dioxide;
                    (D) reuse or reduce water consumption and 
                withdrawal; and
                    (E) capture carbon dioxide post-combustion from 
                flue gas, such as through the use of ammonia-based, 
                aqueous amine or ionic liquid solutions or other 
                methods;
            (2) new combustion systems, including--
                    (A) oxyfuel combustion that burns fuel in the 
                presence of oxygen and recirculated flue gas instead of 
                air producing a concentrated stream of carbon dioxide 
                that can be readily captured for storage or use;
                    (B) chemical looping combustion that burns fuel in 
                the presence of a solid oxygen carrier instead of air 
                producing concentrated stream of carbon dioxide that 
                can be readily captured for storage or use;
                    (C) high-temperature and pressure steam systems, 
                such as ultra supercritical steam generation, that 
                result in high net plant efficiency and reduced fuel 
                consumption, thus producing less carbon dioxide per 
                unit of energy;
                    (D) other innovative carbon dioxide control 
                technologies appropriate for new combustion systems; 
                and
                    (E) high temperature and high pressure materials 
                that will result in much higher plant efficiencies and 
                carbon dioxide emission reductions;
            (3) innovations for IGCC systems that build on the ability 
        of the IGCC to separate pollutants and carbon emissions from 
        gas streams, including--
                    (A) advanced membrane technology for carbon dioxide 
                separation;
                    (B) improved air separation systems;
                    (C) improved compression for the separated and 
                captured carbon dioxide; and
                    (D) other innovative carbon dioxide control 
                technologies appropriate for IGCC systems;
            (4) advanced combustion turbines, including--
                    (A) ultra low emission hydrogen turbines; and
                    (B) oxycoal combustion turbines; and
            (5) sequestration of captured carbon in geological 
        formations, including--
                    (A) plume tracking;
                    (B) carbon dioxide leak detection and mitigation;
                    (C) carbon dioxide fate and transport models; and
                    (D) site evaluation instrumentation.
    (c) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section, to remain available until 
expended--
            (1) for innovations at power plants in operation as of the 
        date of enactment of this Act $450,000,000 for the period of 
        fiscal years 2009 through 2020;
            (2) for new combustion systems $450,000,000 for the period 
        of fiscal years 2009 through 2025;
            (3) for IGCC systems $850,000,000 for the period of fiscal 
        years 2009 through 2025;
            (4) for advanced combustion turbines $350,000,000 for the 
        period of fiscal years 2009 through 2025; and
            (5) for carbon storage $400,000,000 for the period of 
        fiscal years 2009 through 2020.

SEC. 633. CLEAN COAL DEMONSTRATION.

    (a) In General.--The Secretary shall expand and accelerate the 
demonstration of technologies that reduce carbon dioxide emissions from 
coal-fired facilities by demonstrating, at a minimum--
            (1) through facilities in operation as of the date of 
        enactment of this Act--
                    (A) post-combustion carbon dioxide capture at pilot 
                scale at not less than 2 facilities, the award of 
                contracts for which shall be completed by 2010;
                    (B) oxycoal combustion at commercial scale 
                retrofitted to not less than 1 facility, the award of 
                contracts for which shall be completed by 2012;
                    (C) post-combustion carbon dioxide capture at 
                commercial scale retrofitted to not less than 1 
                facility, the award of contracts for which shall be 
                completed by 2012;
                    (D) heat rate and efficiency improvements at 
                commercial scale at not less than 2 facilities, the 
                award of contracts for which shall be completed by 
                2012;
                    (E) water consumption reduction at commercial scale 
                at not less than 2 facilities, the award of contracts 
                for which shall be completed by 2012;
                    (F) post-combustion carbon dioxide capture at pilot 
                scale with technologies other than technologies 
                demonstrated under subparagraphs (A) and (C) at not 
                less than 1 facility, the award of contracts for which 
                shall be completed by 2012;
                    (G) heat rate and efficiency improvements at 
                commercial scale at not less than 3 facilities, the 
                award of contracts for which shall be completed by 
                2014;
                    (H) water consumption reduction at commercial scale 
                at not less than 3 facilities, the award of contracts 
                for which shall be completed by 2014; and
                    (I) post-combustion carbon dioxide capture at pilot 
                scale with technologies other than technologies 
                demonstrated under subparagraphs (A), (C), and (F) at 
                not less than 1 facility, the award of contracts for 
                which shall be completed by 2016;
            (2) through new coal combustion facilities that include 
        carbon capture--
                    (A) oxycoal combustion at pilot scale at not less 
                than 1 facility, the award of contracts for which shall 
                be completed by 2010;
                    (B) post-combustion carbon dioxide capture at pilot 
                scale at not less than 1 facility, the award of 
                contracts for which shall be completed by 2012;
                    (C) oxycoal combustion at commercial scale at not 
                less than 1 facility, the award of contracts for which 
                shall be completed by 2012;
                    (D) supercritical pulverized coal combustion with 
                advanced emission controls and partial carbon dioxide 
                capture at commercial scale at not less than 1 
                facility, the award of contracts for which shall be 
                completed by 2012;
                    (E) oxycoal supercritical circulating fluidized bed 
                combustion at commercial scale at not less than 1 
                facility, the award of contracts for which shall be 
                completed by 2012;
                    (F) post-combustion carbon dioxide capture at 
                commercial scale at not less than 1 facility, the award 
                of contracts for which shall be completed by 2012;
                    (G) post-combustion carbon dioxide capture at pilot 
                scale with technologies other than technologies 
                demonstrated under subparagraphs (B) or (F) at not less 
                than 1 facility, the award of contracts for which shall 
                be completed by 2014;
                    (H) ultra supercritical (1290F) pulverized coal 
                combustion with near-zero emission controls and 90 
                percent carbon dioxide capture at commercial scale at 
                not less than 1 facility, the award of contracts for 
                which shall be completed by 2014;
                    (I) oxycoal combustion with an advanced oxygen 
                separation system at commercial scale at not less than 
                1 facility, the award of contracts for which shall be 
                completed by 2016;
                    (J) second generation post-combustion carbon 
                dioxide capture at commercial scale at not less than 1 
                facility, the award of contracts for which shall be 
                completed by 2014;
                    (K) chemical looping combustion at commercial scale 
                at not less than 1 facility, the award of contracts for 
                which shall be completed by 2018; and
                    (L) ultra advanced supercritical (1400F) 
                combustion with near-zero emission controls and 90 
                percent integrated carbon dioxide capture at commercial 
                scale at not less than 1 facility, the award of 
                contracts for which shall be completed by 2018;
            (3) through IGCC with carbon capture--
                    (A) partial carbon dioxide capture without a water 
                gas shift system at commercial scale at not less than 1 
                facility, the award of contracts for which shall be 
                completed by 2010;
                    (B) using G class turbine at not less than 1 
                facility with at least 400 megawatts in generating 
                capacity, the award of contracts for which shall be 
                completed by 2012;
                    (C) using H class turbines at not less than 1 
                facility with at least 400 megawatts in generating 
                capacity, the award of contracts for which shall be 
                completed by 2014; and
                    (D) using H class turbines at not less than 1 
                facility with at least 400 megawatts in generating 
                capacity, the award of contracts for which shall be 
                completed by 2016.
            (4) through advanced turbines using--
                    (A) monitoring systems for advanced IGCC gas 
                turbine at commercial scale at not less than 1 
                facility, the award of contracts for which shall be 
                completed by 2010;
                    (B) advanced oxygen separation of at least 2,000 
                tons per day in size integrated with a combustion 
                turbine at not less than 1 facility, the award of 
                contracts for which shall be completed by 2012;
                    (C) an oxyfuel turbine of at least 50 megawatts in 
                generating capacity, at not less than 1 facility, the 
                award of contracts for which shall be completed by 
                2015;
                    (D) advanced oxygen separation of at least 2,000 
                tons per day in size integrated with a gas turbine at 
                not less than 1 facility, the award of contracts for 
                which shall be completed by 2015; and
                    (E) an oxyfuel turbine of at least 400 megawatts in 
                generating capacity, at not less than 1 facility, the 
                award of contracts for which shall be completed by 
                2020; and
            (5) for storage of carbon dioxide captured through--
                    (A) a field test of sequestration of at least 
                1,000,000 tons of carbon dioxide per year in a saline 
                formation, the award of contracts for which shall be 
                completed by 2010;
                    (B) field tests of sequestration of at least 
                2,000,000 tons of carbon dioxide per year in a saline 
                formation, the award of contracts for which shall be 
                completed by 2012; and
                    (C) a field test of sequestration of at least 
                1,000,000 tons of carbon dioxide per year in a saline 
                formation, the award of contracts for which shall be 
                completed by 2014.
    (b) Sequestration of Captured Carbon Dioxide.--In any demonstration 
referred to in subsection (a) that demonstrates carbon dioxide capture, 
the carbon dioxide capture shall be used for enhanced oil recovery, 
sequestered in geologically appropriate formations, or permanently 
sequestered or reused, with funds made available to carry out each such 
demonstration for the respective purpose of the demonstration.
    (c) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section, to remain available until 
expended--
            (1) for demonstrations through facilities in operation as 
        of the date of enactment of this Act $850,000,000 for the 
        period of fiscal years 2009 through 2025;
            (2) for new combustion systems $1,950,000,000 for the 
        period of fiscal years 2009 through 2025;
            (3) for IGCC systems $2,950,000,000 for the period of 
        fiscal years 2009 through 2025;
            (4) for advanced combustion turbines $400,000,000 for the 
        period of fiscal years 2009 through 2025; and
            (5) for carbon storage $1,350,000,000 for the period of 
        fiscal years 2009 through 2020.

SEC. 634. IDENTIFICATION OF CLEAN COAL RESEARCH, DEVELOPMENT, AND 
              DEMONSTRATION PROJECTS.

    (a) In General.--The Secretary shall take such steps as are 
necessary to carry out this subtitle.
    (b) Public Comment.--Not later than 90 days after the date of 
enactment of this Act and every 2 years thereafter, the Secretary shall 
institute a public comment period of at least 45 days to assist the 
determination of the specific research, development, and demonstration 
projects required under this subtitle.
    (c) Applications.--Not later than 120 days after the end of each 
public comment period required under subsection (b), the Secretary 
shall--
            (1) publicly identify the specific types of projects that 
        the Secretary intends to pursue to carry out this subtitle;
            (2) establish selection criteria for the specific types of 
        projects identified under paragraph (1); and
            (3) establish an application process that allows persons 
        that are interested in participating in projects identified 
        under paragraph (1) to provide such information as the 
        Secretary determines to be necessary.

              Subtitle E--Clean Coal Technology Incentives

SEC. 641. SHORT TITLE.

    This subtitle may be cited as the ``Energy Security and Climate 
Enhancement Through Clean Coal Technology Act of 2008''.

SEC. 642. MODIFICATION OF SPECIAL RULES FOR ATMOSPHERIC POLLUTION 
              CONTROL FACILITIES.

    (a) In General.--Subsection (d) of section 169 of the Internal 
Revenue Code of 1986 is amended by adding at the end the following new 
paragraph:
            ``(6) Special rules for certain atmospheric pollution 
        control facilities.--Notwithstanding paragraph (1), the term 
        `pollution control facility' includes any mechanical or 
        electronic system which--
                    ``(A) which is a new identifiable treatment 
                facility (as defined in paragraph (4)),
                    ``(B) which is--
                            ``(i) installed after December 31, 2007, 
                        and
                            ``(ii) used in connection with an electric 
                        generation plant or other property which is 
                        primarily coal fired, and
                    ``(C) which is certified by the owner or operator 
                of the plant or other property, in such form and manner 
                as prescribed by the Secretary, to reduce carbon 
                dioxide emissions per net megawatt hour of electricity 
                generation by--
                            ``(i) optimizing combustion,
                            ``(ii) optimizing sootblowing and heat 
                        transfer,
                            ``(iii) upgrading steam temperature control 
                        capabilities,
                            ``(iv) reducing exit gas temperatures (air 
                        heater modifications),
                            ``(v) predrying low rank coals using power 
                        plant waste heat,
                            ``(vi) modifying steam turbines or change 
                        the steam path/blading,
                            ``(vii) replacing single speed motors with 
                        variable speed drives for fans and pumps,
                            ``(viii) improving operational controls, 
                        including neural networks, or
                            ``(ix) any other means approved by the 
                        Secretary, in consultation with the Secretary 
                        of Health and Human Services.''.
    (b) Deduction Not Adjusted for Purposes of Determining Alternative 
Minimum Tax.--Paragraph (5) of section 56(a) of the Internal Revenue 
Code of 1986 is amended by adding at the end the following new 
sentence: ``The preceding sentences of this paragraph shall not apply 
to any pollution control facility described in section 169(d)(6).''.
    (c) Effective Date.--The amendments made by this section shall 
apply to property placed in service after December 31, 2007.

SEC. 643. EXTENSION AND MODIFICATION OF PRODUCTION CREDIT FOR CLOSED-
              LOOP BIOMASS.

    (a) In General.--Clause (ii) of section 45(d)(2)(A) of the Internal 
Revenue Code of 1986 is amended to read as follows:
                            ``(iii) owned by the taxpayer which after 
                        before January 1, 2014 is originally placed in 
                        service and modified, or is originally placed 
                        in service as a facility, to use closed-loop 
                        biomass to co-fire (or, in the case of an 
                        integrated gasification combined cycle 
                        facility, to co-process) with coal, with other 
                        biomass, or with both.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to electricity produced and sold after the date of the enactment of 
this Act.

SEC. 644. QUALIFYING NEW CLEAN COAL POWER PLANT CREDIT.

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

``SEC. 48D. QUALIFYING NEW CLEAN COAL POWER PLANT CREDIT.

    ``(a) Allowance of Credit.--
            ``(1) In general.--For purposes of section 46, the 
        qualifying new clean coal power plant credit for any taxable 
        year is an amount equal to the applicable percentage of the 
        qualified investment for such taxable year.
            ``(2) Applicable percentage.--For purposes of paragraph 
        (1), the applicable percentage shall be determined as follows:


----------------------------------------------------------------------------------------------------------------
                            ``In the case of a plant which either has--                                   The
----------------------------------------------------------------------------------------------------  applicable
                                                                         a carbon dioxide emission    percentage
      a design net heat rate below--                    or                       rate of--               is:
----------------------------------------------------------------------------------------------------------------
 7,580 Btu/kWh (45% efficiency)..........  ...........................  1,577 lbs/MWh or less......   30 percent
7,760 Btu/kWh (44% efficiency)...........  ...........................  1,613 lbs/MWh or less......   28 percent
7,940 Btu/kWh (43% efficiency)...........  ...........................  1,650 lbs/MWh or less......   26 percent
8,120 Btu/kWh (42% efficiency)...........  ...........................  1,690 lbs/MWh or less......   20 percent
8,322 Btu/kWh (41% efficiency)...........  ...........................  1,731 lbs/MWh or less......   10 percent
8,530 Btu/kWh (40% efficiency)...........  ...........................  1,774 lbs/MWh or less......   10 percent
----------------------------------------------------------------------------------------------------------------

    ``(b) Qualified Investment.--
            ``(1) In general.--For purposes of subsection (a), the 
        qualified investment for any taxable year is the basis of 
        eligible property placed in service by the taxpayer during such 
        taxable year which is part of a qualifying new clean coal power 
        plant--
                    ``(A)(i) the construction, reconstruction, or 
                erection of which is completed by the taxpayer, or
                    ``(ii) which is acquired by the taxpayer if the 
                original use of such property commences with the 
                taxpayer, and
                    ``(B) with respect to which depreciation (or 
                amortization in lieu of depreciation) is allowable.
            ``(2) Special rule for certain subsidized property.--Rules 
        similar to section 48(a)(4) shall apply for purposes of this 
        section.
            ``(3) Certain qualified progress expenditures rules made 
        applicable.--Rules similar to the rules of subsections (c)(4) 
        and (d) of section 46 (as in effect on the day before the 
        enactment of the Revenue Reconciliation Act of 1990) shall 
        apply for purposes of this section.
    ``(c) Definitions.--For purposes of this section--
            ``(1) Eligible property.--The term `eligible property' 
        means any property which is a part of a qualifying new clean 
        coal power plant.
            ``(2) Qualifying new clean coal power plant.--The term 
        `qualifying new clean coal power plant' means a facility 
        which--
                    ``(A) which meets the requirements of section 
                48A(e),
                    ``(B) which either--
                            ``(i) has a design net heat rate of below 
                        8,530 Btu/kWh, or
                            ``(ii) has a carbon dioxide emission rate 
                        of 1,774 lbs/MWh or less, and
                    ``(C) which--
                            ``(i) is designed to capture carbon dioxide 
                        emissions, or
                            ``(ii)(I) is designed to include a built-in 
                        space for future carbon dioxide capture 
                        hardware (and improved foundations and ironwork 
                        necessary to accommodate the additional 
                        hardware),
                            ``(II) includes an engineering feasibility 
                        study identifying a system, including 
                        associated cost and performance parameters, to 
                        retrofit carbon capture equipment, and
                            ``(III) includes a site or sited identified 
                        where carbon dioxide may be stored or used for 
                        commercial purposes.
    ``(d) Qualifying New Clean Coal Power Plant Program.--
            ``(1) Establishment.--Not later than 180 days after the 
        date of enactment of this section, the Secretary, in 
        consultation with the Secretary of Energy, shall establish a 
        qualifying new clean coal power plant program, under which the 
        Secretary shall certify projects eligible for the credit under 
        subsection (a).
            ``(2) Application.--An application under for certification 
        under this section shall contain such information as the 
        Secretary may require in order to make a determination to 
        accept or reject an application for certification as meeting 
        the requirements of this section. Any information contained in 
        the application shall be protected as provided in section 
        552(b)(4) of title 5, United States Code.
            ``(3) Aggregate credits.--The aggregate or projects 
        certified by the Secretary under this subsection shall not 
        exceed an aggregate capacity for electricity generation of more 
        than 6,000 megawatts.
    ``(e) Recapture of Credit.--The Secretary shall provide for 
recapturing the benefit of any credit allowable under subsection (a) 
with respect to any project which fails to attain or maintain any of 
the requirements of this section.''.
    (b) Conforming Amendments.--
            (1) Section 46 of the Internal Revenue Code of 1986, as 
        amended by this Act, is amended by striking ``and'' at the end 
        of paragraph (4), by striking the period at the end of 
        paragraph (5) and inserting ``, and'', and by adding at the end 
        the following new paragraph:
            ``(6) the qualifying new clean coal power plant credit.''.
            (2) Section 49(a)(1)(C) of such Code, as amended by this 
        Act, is amended by striking ``and'' at the end of clause (iv), 
        by striking the period at the end of clause (v) and inserting 
        ``, and'', and by adding at the end the following new clause:
                            ``(vi) the basis of any property which is 
                        part of a qualifying new clean coal power plant 
                        under section 48D.''.
            (3) The table of sections for subpart E of part IV of 
        subchapter A of chapter 1 of such Code, as amended by this Act, 
        is amended by inserting after the item relating to section 48C 
        the following new item:

``Sec. 48D. Qualifying new clean coal power plant credit.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to periods after the date of the enactment of this Act, under 
rules similar to the rules of section 48(m) of the Internal Revenue 
Code of 1986 (as in effect before the date of the enactment of the 
Revenue Reconciliation Act of 1990).

SEC. 645. INVESTMENT CREDIT FOR EQUIPMENT USED TO CAPTURE, TRANSPORT, 
              AND STORE CARBON DIOXIDE.

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

``SEC. 48E. EQUIPMENT USED TO CAPTURE, TRANSPORT, AND STORE CARBON 
              DIOXIDE EMISSIONS.

    ``(a) General Rule.--For purposes of section 46, the qualifying 
carbon dioxide equipment credit for any taxable year is an amount equal 
to 30 percent of the qualified investment for such taxable year.
    ``(b) Qualified Investment.--For purposes of subsection (a), the 
qualified investment for any taxable year is the basis of eligible 
property placed in service by the taxpayer during such taxable year.
    ``(c) Definitions.--For purposes of this section--
            ``(1) Eligible property.--The term `eligible property' 
        means equipment installed on a qualified coal-fired electric 
        power generating unit to capture, transport, and store carbon 
        dioxide produced at such generating unit, including equipment 
        to separate and pressurize carbon dioxide for transport 
        (including hardware to operate such equipment) and equipment to 
        transport, inject, and monitor such carbon dioxide, as further 
        specified and identified, by rule, by the Secretary.
            ``(2) Qualified coal-fired electric generation unit.--The 
        term `qualified coal-fired electric generation unit' means a 
        unit which, after installation of eligible property, is 
        designed to capture and store in a geologic formation not less 
        than 500,000 metric tons of carbon dioxide per year.
    ``(d) Aggregate Credits.--The credits allowed under subsection (a) 
shall apply only to the first 9,000 megawatts of capacity of qualified 
coal-fired electric power generating units certified by the Secretary 
under subsection (e).
    ``(e) Certification.--
            ``(1) Certification process.--The Secretary shall establish 
        a certification process to determine the extent to which 
        eligible property has been installed on a qualified coal-fired 
        electric power generating unit, and to make such other 
        determinations as the Secretary deems appropriate. The 
        Secretary shall prepare an application for certification.
            ``(2) Requirements for applications for certification.--An 
        application for certification shall contain such information as 
        the Secretary may require in order to establish credit 
        entitlement. Any information contained in an application shall 
        be protected as provided in section 552(b)(4) of title 5, 
        United States Code.''.
    (b) Conforming Amendments.--
            (1) Section 46 of the Internal Revenue Code of 1986, as 
        amended by this Act, is amended by striking ``and'' at the end 
        of paragraph (5), by striking the period at the end of 
        paragraph (6) and inserting ``, and'', and by adding at the end 
        the following new paragraph:
            ``(7) the qualifying carbon dioxide equipment credit.''.
            (2) Section 49(a)(1)(C) of such Code, as amended by this 
        Act, is amended by striking ``and'' at the end of clause (v), 
        by striking the period at the end of clause (vi) and inserting 
        ``, and'', and by adding at the end the following new clause:
                            ``(vii) the basis of any eligible property 
                        under section 48E.''.
            (3) The table of sections for subpart E of part IV of 
        subchapter A of chapter 1 of such Code, as amended by this Act 
        is amended by inserting after the item relating to section 48D 
        the following new section:

``Sec. 48E. Equipment used to capture, transport, and store carbon 
                            dioxide emissions.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to periods after the date of the enactment of this Act, under 
rules similar to the rules of section 48(m) of the Internal Revenue 
Code of 1986 (as in effect before the date of the enactment of the 
Revenue Reconciliation Act of 1990).

SEC. 646. TAX CREDIT FOR CARBON DIOXIDE SEQUESTRATION IN THE GENERATION 
              OF ELECTRICITY.

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

``SEC. 45Q. CREDIT SEQUESTERING CARBON DIOXIDE IN THE GENERATION OF 
              ELECTRICITY.

    ``(a) General Rule.--For purposes of section 38, the carbon dioxide 
sequestration credit for any taxable year is an amount equal to the sum 
of--
            ``(1) $30 per metric ton of qualified carbon dioxide which 
        is--
                    ``(A) captured by the taxpayer at a qualified 
                facility during the credit period, and
                    ``(B) disposed of by the taxpayer in secure 
                geological storage, and
            ``(2) $10 per metric ton of qualified carbon dioxide which 
        is--
                    ``(A) captured by the taxpayer at a qualified 
                facility during the credit period, and
                    ``(B) used by the taxpayer as a tertiary injectant 
                in a qualified enhanced oil or natural gas recovery 
                project.
    ``(b) Qualified Facility.--For purposes of this section--
            ``(1) In general.--The term `qualified facility' means any 
        industrial facility--
                    ``(A) which is owned by the taxpayer;
                    ``(B) at which carbon capture equipment is placed 
                in service;
                    ``(C) which captures not less than 500,000 metric 
                tons of carbon dioxide during the taxable year; and
                    ``(D) which is certified by the Secretary under 
                paragraph (2).
            ``(2) Certification.--
                    ``(A) In general.--The Secretary, in consultation 
                with the Secretary of Energy, shall establish a program 
                under which facilities which use coal for the 
                generation of electricity are certified for purposes of 
                this section.
                    ``(B) Limitation.--The total aggregate generating 
                capacity of all facilities certified by the Secretary 
                under this paragraph shall not exceed 9,000 megawatts.
    ``(c) Qualified Carbon Dioxide.--For purposes of this section--
            ``(1) In general.--The term `qualified carbon dioxide' 
        means carbon dioxide captured from an industrial source which--
                    ``(A) would otherwise be released into the 
                atmosphere as industrial emissions of greenhouse gas, 
                and
                    ``(B) is measured at the source of capture and 
                verified at the point of disposal or injection.
            ``(2) Recycled carbon dioxide.--The term `qualified carbon 
        dioxide' includes the initial deposit of captured carbon 
        dioxide used as a tertiary injectant. Such term does not 
        include carbon dioxide that is recaptured, recycled, and 
        reinjected as part of the enhanced oil and natural gas recovery 
        process.
    ``(d) Special Rules and Definitions.--For purposes of this 
section--
            ``(1) Credit period.--The term `credit period' means, with 
        respect to any qualified facility, the 10-year period beginning 
        on the date on which qualified carbon dioxide for which a 
        credit was allowed under subsection (a) was first captured.
            ``(2) Only carbon dioxide captured within the united states 
        taken into account.--The credit under this section shall apply 
        only with respect to qualified carbon dioxide the capture of 
        which is within--
                    ``(A) the United States (within the meaning of 
                section 638(1)); or
                    ``(B) a possession of the United States (within the 
                meaning of section 638(2)).
            ``(3) Secure geological storage.--The Secretary, in 
        consultation with the Administrator of the Environmental 
        Protection Agency, shall establish regulations for determining 
        adequate security measures for the geological storage of carbon 
        dioxide under subsection (a)(1)(B) such that the carbon dioxide 
        does not escape into the atmosphere. Such term shall include 
        storage at deep saline formations and unminable coal seems 
        under such conditions as the Secretary may determine under such 
        regulations.
            ``(4) Tertiary injectant.--The term `tertiary injectant' 
        has the same meaning as when used within section 193(b)(1).
            ``(5) Qualified enhanced oil or natural gas recovery 
        project.--The term `qualified enhanced oil or natural gas 
        recovery project' has the meaning given the term `qualified 
        enhanced oil recovery project' by section 43(c)(2), by 
        substituting `crude oil or natural gas' for `crude oil' in 
        subparagraph (A)(i) thereof.
            ``(6) Credit attributable to taxpayer.--Any credit under 
        this section shall be attributable to the person that captures 
        and physically or contractually ensures the disposal of or the 
        use as a tertiary injectant of the qualified carbon dioxide, 
        except to the extent provided in regulations prescribed by the 
        Secretary.
            ``(7) Recapture.--The Secretary shall, by regulations, 
        provide for recapturing the benefit of any credit allowable 
        under subsection (a) with respect to any qualified carbon 
        dioxide which ceases to be captured, disposed of, or used as a 
        tertiary injectant in a manner consistent with the requirements 
        of this section.
            ``(8) Inflation adjustment.--In the case of any taxable 
        year beginning in a calendar year after 2008, there shall be 
        substituted for each dollar amount contained in subsection (a) 
        an amount equal to the product of--
                    ``(A) such dollar amount; multiplied by
                    ``(B) the inflation adjustment factor for such 
                calendar year determined under section 43(b)(3)(B) for 
                such calendar year, determined by substituting `2007' 
                for `1990'.''.
    (b) Conforming Amendment.--Section 38(b) of the Internal Revenue 
Code of 1986 (relating to general business credit), as amended by this 
Act, is amended by striking ``plus'' at the end of paragraph (33), by 
striking the period at the end of paragraph (34) and inserting ``, 
plus'', and by adding at the end of following new paragraph:
            ``(35) the carbon dioxide sequestration credit determined 
        under section 45Q(a).''.
    (c) Clerical Amendment.--The table of sections for subpart B of 
part IV of subchapter A of chapter 1 of the Internal Revenue Code of 
1986 (relating to other credits) is amended by adding at the end the 
following new section:

``Sec. 45Q. Credit for sequestering carbon dioxide in the generation of 
                            electricity.''.
    (d) Effective Date.--The amendments made by this section shall 
apply carbon dioxide captured after the date of the enactment of this 
Act.

SEC. 647. CLEAN ENERGY COAL BONDS.

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

``SEC. 54C. CLEAN ENERGY COAL BONDS.

    ``(a) Clean Energy Coal Bond.--For purposes of this subchapter--
            ``(1) In general.--The term `clean energy coal bond' means 
        any bond issued as part of an issue if--
                    ``(A) the bond is issued by a qualified issuer 
                pursuant to an allocation by the Secretary to such 
                issuer of a portion of the national clean energy coal 
                bond limitation under subsection (b)(2);
                    ``(B) 100 percent of the available project proceeds 
                from the sale of such issue are to be used for capital 
                expenditures incurred by qualified borrowers for 1 or 
                more qualified projects;
                    ``(C) the qualified issuer designates such bond for 
                purposes of this section and the bond is in registered 
                form; and
                    ``(D) in lieu of the requirements of section 
                54A(d)(2), the issue meets the requirements of 
                subsection (c).
            ``(2) Qualified project; special use rules.--
                    ``(A) In general.--The term `qualified project' 
                means a qualified clean coal project (as defined in 
                subsection (f)(1)) placed in service by a qualified 
                borrower.
                    ``(B) Refinancing rules.--For purposes of paragraph 
                (1)(B), a qualified project may be refinanced with 
                proceeds of a clean energy coal bond only if the 
                indebtedness being refinanced (including any obligation 
                directly or indirectly refinanced by such indebtedness) 
                was originally incurred by a qualified borrower after 
                the date of the enactment of this section.
                    ``(C) Reimbursement.--For purposes of paragraph 
                (1)(B), a clean energy coal bond may be issued to 
                reimburse a qualified borrower for amounts paid after 
                the date of the enactment of this section with respect 
                to a qualified project, but only if--
                            ``(i) prior to the payment of the original 
                        expenditure, the qualified borrower declared 
                        its intent to reimburse such expenditure with 
                        the proceeds of a clean energy coal bond;
                            ``(ii) not later than 60 days after payment 
                        of the original expenditure, the qualified 
                        issuer adopts an official intent to reimburse 
                        the original expenditure with such proceeds; 
                        and
                            ``(iii) reimbursement is not made later 
                        than 18 months after the date the original 
                        expenditure is paid or the date the project is 
                        placed in service or abandoned, but in no event 
                        more than 3 years after the original 
                        expenditure is paid.
                    ``(D) Treatment of changes in use.--For purposes of 
                paragraph (1)(B), the proceeds of an issue shall not be 
                treated as used for a qualified project to the extent 
                that a qualified borrower takes any action within its 
                control which causes such proceeds not to be used for a 
                qualified project. The Secretary shall prescribe 
                regulations specifying remedial actions that may be 
                taken (including conditions to taking such remedial 
                actions) to prevent an action described in the 
                preceding sentence from causing a bond to fail to be a 
                clean energy coal bond.
    ``(b) Limitation on Amount of Bonds Designated.--
            ``(1) National limitation.--There is a national clean 
        energy coal bond limitation of $5,000,000,000.
            ``(2) Allocation by secretary.--The Secretary shall 
        allocate the amount described in paragraph (1) among qualified 
        projects in such manner as the Secretary determines 
        appropriate.
    ``(c) Special Rules Relating to Expenditures.--
            ``(1) In general.--An issue shall be treated as meeting the 
        requirements of this subsection if, as of the date of issuance. 
        the qualified issuer reasonably expects--
                    ``(A) 100 percent or more of the available project 
                proceeds from the sale of the issue are to be spent for 
                1 or more qualified projects within the 5-year period 
                beginning on the date of issuance of the clean energy 
                bond;
                    ``(B) a binding commitment with a third party to 
                spend at least 10 percent of such available project 
                proceeds from the sale of the issue will be incurred 
                within the 6-month period beginning on the date of 
                issuance of the clean energy bond or, in the case of a 
                clean energy bond the available project proceeds of 
                which are to be loaned to 2 or more qualified 
                borrowers, such binding commitment will be incurred 
                within the 6-month period beginning on the date of the 
                loan of such proceeds to a qualified borrower; and
                    ``(C) such projects will be completed with due 
                diligence and the available project proceeds from the 
                sale of the issue will be spent with due diligence.
            ``(2) Extension of period.--Upon submission of a request 
        prior to the expiration of the period described in paragraph 
        (1)(A), the Secretary may extend such period if the qualified 
        issuer establishes that the failure to satisfy the 5-year 
        requirement is due to reasonable cause and the related projects 
        will continue to proceed with due diligence.
            ``(3) Failure to spend required amount of bond proceeds 
        within 5 years.--To the extent that less than 100 percent of 
        the available project proceeds of such issue are expended by 
        the close of the 5-year period beginning on the date of 
        issuance (or if an extension has been obtained under paragraph 
        (2), by the close of the extended period), the qualified issuer 
        shall redeem all of the nonqualified bonds within 90 days after 
        the end of such period. For purposes of this paragraph, the 
        amount of the nonqualified bonds required to be redeemed shall 
        be determined in the same manner as under section 142.
    ``(d) Cooperative Electric Company; Qualified Energy Tax Credit 
Bond Lender; Governmental Body; Qualified Borrower.--For purposes of 
this section--
            ``(1) Cooperative electric company.--The term `cooperative 
        electric company' means a mutual or cooperative electric 
        company described in section 501(c)(12) or section 
        1381(a)(2)(C), or a not-for-profit electric utility which has 
        received a loan or loan guarantee under the Rural 
        Electrification Act.
            ``(2) Clean energy bond lender.--The term `clean energy 
        bond lender' means a lender which is a cooperative which is 
        owned by, or has outstanding loans to, 100 or more cooperative 
        electric companies and is in existence on February 1, 2002, and 
        shall include any affiliated entity which is controlled by such 
        lender.
            ``(3) Public power entity.--The term `public power entity' 
        means a State utility with a service obligation, as such terms 
        are defined in section 217 of the Federal Power Act (as in 
        effect on the date of enactment of this paragraph).
            ``(4) Qualified issuer.--The term `qualified issuer' 
        means--
                    ``(A) a clean energy bond lender;
                    ``(B) a cooperative electric company; or
                    ``(C) a public power entity.
            ``(5) Qualified borrower.--The term `qualified borrower' 
        means--
                    ``(A) a mutual or cooperative electric company 
                described in section 501(c)(12) or 1381(a)(2)(C); or
                    ``(B) a public power entity.
    ``(e) Special Rules Relating to Pool Bonds.--No portion of a pooled 
financing bond may be allocable to any loan unless the borrower has 
entered into a written loan commitment for such portion prior to the 
issue date of such issue.
    ``(f) Other Definitions and Special Rules.--For purposes of this 
section--
            ``(1) Qualified clean coal project.--For purposes of this 
        section, the term `qualified clean coal project' means--
                    ``(A) an atmospheric pollution control facility 
                (within the meaning of section 169(d)(5)(C));
                    ``(B) a closed-loop biomass facility (within the 
                meaning of section 45(d)(2));
                    ``(C) a qualified new clean coal power plant 
                (within the meaning of section 48D(d)(1));
                    ``(D) a qualifying carbon dioxide equipment 
                described in section 48E(c)(1); or
                    ``(E) a qualified facility (within the meaning of 
                section 450(c)).
            ``(2) Pooled financing bond.--The term `pooled financing 
        bond' shall have the meaning given such term by section 
        149(f)(4)(A).
    ``(g) Termination.--This section shall not apply with respect to 
any bond issued after December 31, 2018.''.
    (b) Conforming Amendments.--
            (1) Paragraph (1) of section 54A(d) of the Internal Revenue 
        Code of 1986 is amended to read as follows:
            ``(1) Qualified tax credit bond.--The term `qualified tax 
        credit bond' means--
                    ``(A) a qualified forestry conservation bond, or
                    ``(B) a clean energy coal bond,
        which is part of an issue that meets requirements of paragraphs 
        (2), (3), (4), (5), and (6).''.
            (2) Subparagraph (C) of section 54A(d)(2) of such Code is 
        amended to read as follows:
                    ``(C) Qualified purpose.--For purposes of this 
                paragraph, the term `qualified purpose' means--
                            ``(i) in the case of a qualified forestry 
                        conservation bond, a purpose specified in 
                        section 54B(e); and
                            ``(ii) in the case of a clean energy coal 
                        bond, a purpose specified in section 
                        54C(f)(1).''.
    (c) Clerical Amendment.--The table of sections for subpart I of 
part IV of subchapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by adding at the end the following new item:

``Sec. 54C. Clean energy coal bonds.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to bonds issued after December 31, 2008.

                       TITLE VII--NUCLEAR ENERGY

           Subtitle A--Nuclear Waste Access to Yucca Mountain

SEC. 701. DEFINITIONS.

    In this subtitle:
            (1) Disposal.--The term ``disposal'' has the meaning given 
        the term in section 2 of the Nuclear Waste Policy Act of 1982 
        (42 U.S.C. 10101).
            (2) High-level radioactive waste.--The term ``high-level 
        radioactive waste'' has the meaning given the term in section 2 
        of the Nuclear Waste Policy Act of 1982 (42 U.S.C. 10101).
            (3) Project.--The term ``Project'' means the Yucca Mountain 
        Project.
            (4) Repository.--The term ``repository'' has the meaning 
        given the term in section 2 of the Nuclear Waste Policy Act of 
        1982 (42 U.S.C. 10101).
            (5) Secretary.--The term ``Secretary'' means the Secretary 
        of Energy.
            (6) Spent nuclear fuel.--The term ``spent nuclear fuel'' 
        has the meaning given the term in section 2 of the Nuclear 
        Waste Policy Act of 1982 (42 U.S.C. 10101).
            (7) Yucca mountain site.--The term ``Yucca Mountain site'' 
        has the meaning given the term in section 2 of the Nuclear 
        Waste Policy Act of 1982 (42 U.S.C. 10101).

SEC. 702. WITHDRAWAL OF LAND.

    (a) Land Withdrawal; Jurisdiction; Reservation; Acquisition.--
            (1) Land withdrawal.--Subject to valid existing rights, and 
        except as otherwise provided in this subtitle, the land 
        described in subsection (b) is withdrawn permanently from any 
        form of entry, appropriation, or disposal under the public land 
        laws, including, without limitation--
                    (A) the mineral leasing laws;
                    (B) the geothermal leasing laws;
                    (C) materials sales laws; and
                    (D) the mining laws.
            (2) Jurisdiction.--As of the date of enactment of this Act, 
        any land described in subsection (b) that is under the 
        jurisdiction of the Secretary of the Air Force or the Secretary 
        of the Interior shall be--
                    (A) transferred to the Secretary; and
                    (B) under the jurisdiction of the Secretary.
            (3) Reservation.--The land described in subsection (b) is 
        reserved for use by the Secretary for activities associated 
        with the disposal of high-level radioactive waste and spent 
        nuclear fuel under the Nuclear Waste Policy Act of 1982 (42 
        U.S.C. 10101 et seq.), including--
                    (A) development;
                    (B) preconstruction testing and performance 
                confirmation;
                    (C) licensing;
                    (D) construction;
                    (E) management and operation;
                    (F) monitoring;
                    (G) closure and post-closure; and
                    (H) other such activities associated with the 
                disposal of high-level radioactive waste and spent 
                nuclear fuel under the Nuclear Waste Policy Act of 1982 
                (42 U.S.C. 10101 et seq.).
    (b) Land Description.--
            (1) Boundaries.--The land referred to in subsection (a) is 
        the approximately 147,000 acres of land located in Nye County, 
        Nevada, as generally depicted on the map relating to the 
        Project, numbered YMP-03-024.2, entitled ``Proposed Land 
        Withdrawal'', and dated July 21, 2005.
            (2) Legal description and map.--
                    (A) In general.--As soon as practicable after the 
                date of enactment of this Act, the Secretary of the 
                Interior shall--
                            (i) publish in the Federal Register a 
                        notice containing a legal description of the 
                        land described in this subsection; and
                            (ii) provide to Congress, the Governor of 
                        the State of Nevada, and the Archivist of the 
                        United States--
                                    (I) a copy of the map referred to 
                                in paragraph (1); and
                                    (II) the legal description of the 
                                land.
                    (B) Treatment.--
                            (i) In general.--The map and legal 
                        description referred to in subparagraph (A) 
                        shall have the same force and effect as if the 
                        map and legal description were included in this 
                        subtitle.
                            (ii) Technical corrections.--The Secretary 
                        of the Interior may correct any clerical or 
                        typographical error in the map and legal 
                        description referred to in subparagraph (A).
    (c) Revocations.--
            (1) Public land order.--Public Land Order 6802, dated 
        September 25, 1990 (as extended by Public Land Order 7534), and 
        any condition or memorandum of understanding accompanying the 
        land order (as so extended), is revoked.
            (2) Right of way.--The rights-of-way reservations relating 
        to the Project, numbered N-48602 and N-47748 and dated January 
        5, 2001, are revoked.
    (d) Management of Withdrawn Land.--
            (1) In general.--The Secretary, in consultation with the 
        Secretary of the Air Force and the Secretary of the Interior, 
        as appropriate, shall manage the land withdrawn under 
        subsection (a)(1) in accordance with--
                    (A) the Federal Land Policy and Management Act of 
                1976 (43 U.S.C. 1701 et seq.);
                    (B) this subtitle; and
                    (C) other applicable laws.
            (2) Management plan.--
                    (A) Development.--Not later than 3 years after the 
                date of enactment of this Act, the Secretary, in 
                consultation with the Secretary of the Air Force and 
                the Secretary of the Interior, as appropriate, shall 
                develop and submit to Congress and the State of Nevada 
                a management plan for the use of the land withdrawn 
                under subsection (a)(1).
                    (B) Priority.--Subject to subparagraphs (C), (D), 
                and (E), use of the land withdrawn under subsection 
                (a)(1) for an activity not relating to the Project 
                shall be subject to such conditions and restrictions as 
                the Secretary considers to be appropriate to facilitate 
                activities relating to the Project.
                    (C) Air force use.--The management plan may provide 
                for the continued use by the Department of the Air 
                Force of the portion of the land withdrawn under 
                subsection (a)(1) located within the Nellis Air Force 
                base test and training range under such terms and 
                conditions as may be agreed to by the Secretary and the 
                Secretary of the Air Force.
                    (D) Nevada test site use.--The management plan may 
                provide for the continued use by the National Nuclear 
                Security Administration of the portion of the land 
                withdrawn under subsection (a)(1) located within the 
                Nevada test site of the Administration under such 
                conditions as the Secretary considers to be necessary 
                to minimize any effect on activities relating to the 
                Project or other activities of the Administration.
                    (E) Other uses.--
                            (i) In general.--The management plan shall 
                        include provisions--
                                    (I) relating to the maintenance of 
                                wildlife habitat on the land withdrawn 
                                under subsection (a)(1); and
                                    (II) under which the Secretary may 
                                permit any use not relating to the 
                                Project, as the Secretary considers to 
                                be appropriate, in accordance with the 
                                requirements under clause (ii).
                            (ii) Requirements.--
                                    (I) Grazing.--The Secretary may 
                                permit any grazing use to continue on 
                                the land withdrawn under subsection 
                                (a)(1) if the grazing use was 
                                established before the date of 
                                enactment of this Act, subject to such 
                                regulations, policies, and practices as 
                                the Secretary, in consultation with the 
                                Secretary of the Interior, determines 
                                to be appropriate, and in accordance 
                                with applicable grazing laws and 
                                policies, including--
                                            (aa) the Act of June 28, 
                                        1934 (commonly known as the 
                                        ``Taylor Grazing Act'') (43 
                                        U.S.C. 315 et seq.);
                                            (bb) title IV of the 
                                        Federal Land Policy Management 
                                        Act of 1976 (43 U.S.C. 1751 et 
                                        seq.); and
                                            (cc) the Public Rangelands 
                                        Improvement Act of 1978 (43 
                                        U.S.C. 1901 et seq.).
                                    (II) Hunting and trapping.--The 
                                Secretary may permit any hunting or 
                                trapping use to continue on the land 
                                withdrawn under subsection (a)(1) if 
                                the hunting or trapping use was 
                                established before the date of 
                                enactment of this Act, at such time and 
                                in such zones as the Secretary, in 
                                consultation with the Secretary of the 
                                Interior and the State of Nevada, may 
                                establish, taking into consideration 
                                public safety, national security, 
                                administration, and public use and 
                                enjoyment of the land.
                    (F) Public access.--
                            (i) In general.--The management plan may 
                        provide for limited public access to the 
                        portion of the land withdrawn under subsection 
                        (a)(1) that was under the control of the Bureau 
                        of Land Management on the day before the date 
                        of enactment of this Act.
                            (ii) Specific uses.--The management plan 
                        may permit public uses of the land relating to 
                        the Nye County Early Warning Drilling Program, 
                        utility corridors, and other uses the 
                        Secretary, in consultation with the Secretary 
                        of the Interior, considers to be consistent 
                        with the purposes of the withdrawal under 
                        subsection (a)(1).
            (3) Mining.--
                    (A) In general.--Surface and subsurface mining and 
                oil and gas production, including slant drilling from 
                outside the boundaries of the land withdrawn under 
                subsection (a)(1), shall be prohibited at any time on 
                or under the land.
                    (B) Evaluation of claims.--The Secretary of the 
                Interior shall evaluate and adjudicate the validity of 
                any mining claim relating to any portion of the land 
                withdrawn under subsection (a)(1) that was under the 
                control of the Bureau of Land Management on the day 
                before the date of enactment of this Act.
                    (C) Compensation.--The Secretary shall provide just 
                compensation for the acquisition of any valid property 
                right relating to mining pursuant to the withdrawal 
                under subsection (a)(1).
            (4) Closures.--If the Secretary, in consultation with the 
        Secretary of the Air Force and the Secretary of the Interior, 
        as appropriate, determines that the health and safety of the 
        public or the national defense and security require the closure 
        of a road, trail, or other portion of the land withdrawn under 
        subsection (a)(1) (including the airspace above the land), the 
        Secretary--
                    (A) may close the road, trail, or portion of land 
                (including airspace); and
                    (B) shall provide to the public a notice of the 
                closure.
            (5) Implementation.--The Secretary and the Secretary of the 
        Air Force or the Secretary of the Interior, as appropriate, 
        shall implement the management plan developed under paragraph 
        (2) under such terms and conditions as may be agreed to by the 
        Secretaries.

SEC. 703. RECEIPT AND STORAGE FACILITIES.

    Section 114(b) of the Nuclear Waste Policy Act of 1982 (42 U.S.C. 
10134(b)) is amended--
            (1) by striking ``If the President'' and inserting the 
        following:
            ``(1) In general.--If the President''; and
            (2) by adding at the end the following:
            ``(2) Application for receipt and storage facilities.--
                    ``(A) In general.--In conjunction with the 
                submission of an application for a construction 
                authorization under this subsection, the Secretary 
                shall apply to the Commission for a license in 
                accordance with part 72 of title 10, Code of Federal 
                Regulations (or a successor regulation), to construct 
                and operate facilities to receive and store spent 
                nuclear fuel and high-level radioactive waste at the 
                Yucca Mountain site.
                    ``(B) Deadline for final decision by commission.--
                The Commission shall issue a final decision approving 
                or disapproving the issuance of the license not later 
                than 18 months after the date of submission of the 
                application to the Commission.''.

SEC. 704. REPEAL OF CAPACITY LIMITATION.

    Section 114(d) of the Nuclear Waste Policy Act of 1982 (42 U.S.C. 
10134(d)) is amended by striking the second and third sentences.

SEC. 705. INFRASTRUCTURE ACTIVITIES.

    Section 114 of the Nuclear Waste Policy Act of 1982 (42 U.S.C. 
10134) is amended by adding at the end the following:
    ``(g) Infrastructure Activities.--
            ``(1) Construction of connected facilities.--At any time 
        after the completion by the Secretary of a final environmental 
        impact statement that evaluates the activities to be performed 
        under this subsection, the Secretary may commence the following 
        activities in connection with any activity or facility licensed 
        or to be licensed by the Commission at the Yucca Mountain site:
                    ``(A) Preparation of the site for construction of 
                the facility (including such activities as clearing, 
                grading, and construction of temporary access roads and 
                borrow areas).
                    ``(B) Installation of temporary construction 
                support facilities (including such items as warehouse 
                and shop facilities, utilities, concrete mixing plants, 
                docking and unloading facilities, and construction 
                support buildings).
                    ``(C) Excavation for facility structures.
                    ``(D) Construction of service facilities (including 
                such facilities as roadways, paving, railroad spurs, 
                fencing, exterior utility and lighting systems, 
                transmission lines, and sanitary sewerage treatment 
                facilities).
                    ``(E) Construction of structures, systems, and 
                components that do not prevent or mitigate the 
                consequences of possible accidents that could cause 
                undue risk to the health and safety of the public.
                    ``(F) Installation of structural foundations 
                (including any necessary subsurface preparation) for 
                structures, systems, and components that prevent or 
                mitigate the consequences of possible accidents that 
                could cause undue risk to the health and safety of the 
                public.
            ``(2) Authorization to receive and store.--
                    ``(A) Definitions.--In this paragraph:
                            ``(i) Defense waste.--The term `defense 
                        waste' means high-level radioactive waste, and 
                        spent nuclear fuel, that results from an atomic 
                        energy defense activity.
                            ``(ii) Legacy spent nuclear fuel.--The term 
                        `legacy spent nuclear fuel' means spent nuclear 
                        fuel--
                                    ``(I) that is subject to a contract 
                                entered into pursuant to section 302; 
                                and
                                    ``(II) for which the Secretary 
                                determines that there is not at the 
                                time of the determination, and will not 
                                be within a reasonable time after the 
                                determination, sufficient domestic 
                                capacity available to recycle the spent 
                                nuclear fuel.
                    ``(B) Authorization for defense waste.--At any time 
                after the issuance of a license for receipt and storage 
                facilities under subsection (b)(2), the Secretary may 
                transport defense waste to receipt and storage 
                facilities at the Yucca Mountain site.
                    ``(C) Authorization for legacy spent nuclear 
                fuel.--At any time after the issuance of a construction 
                authorization under subsection (d) and the issuance of 
                a license for receipt and storage facilities under 
                subsection (b)(2), the Secretary may receive and store 
                legacy spent nuclear fuel and high-level radioactive 
                waste at the Yucca Mountain site.''.

SEC. 706. RAIL LINE.

    (a) Construction of Rail Line.--The Secretary shall acquire rights-
of-way within the corridor designated in subsection (b) in accordance 
with this section, and shall construct and operate, or cause to be 
constructed and operated, a railroad and such facilities as are 
required to transport spent nuclear fuel and high-level radioactive 
waste from existing rail systems to the site of surface facilities 
within the geologic repository operations area for the receipt, 
handling, packaging, and storage of spent nuclear fuel and high-level 
radioactive waste prior to emplacement.
    (b) Acquisition and Withdrawal of Land.--
            (1) Route designation and acquisition.--
                    (A) Rights-of-way and facilities.--The Secretary 
                shall acquire such rights-of-way and develop such 
                facilities within the corridor referred to as ``X'' on 
                the map dated [___] and on file with the Secretary as 
                are necessary to carry out subsection (a).
                    (B) Recommendations.--The Secretary shall consider 
                specific alignment proposals for the route for the 
                corridor made by the State of Nevada and the units of 
                local government within whose jurisdiction the route is 
                proposed to pass.
                    (C) Notice and description.--Not later than 180 
                days after the date of enactment of this section, the 
                Secretary shall--
                            (i) publish in the Federal Register a 
                        notice containing a legal description of the 
                        corridor; and
                            (ii) file copies of the map referred to in 
                        paragraph (1) and the legal description of the 
                        corridor with--
                                    (I) Congress;
                                    (II) the Secretary of the Interior;
                                    (III) the Governor of the State of 
                                Nevada;
                                    (IV) the Board of County 
                                Commissioners of Lincoln County, 
                                Nevada;
                                    (V) the Board of County 
                                Commissioners of Nye County, Nevada; 
                                and
                                    (VI) the Archivist of the United 
                                States.
                    (D) Administration.--
                            (i) Effect.--The map and legal description 
                        referred to in subparagraph (C) shall have the 
                        same force and effect as if the map and legal 
                        description were included in this subtitle.
                            (ii) Corrections.--The Secretary may 
                        correct clerical and typographical errors in 
                        the map and legal description and make minor 
                        adjustments in the boundaries of the corridor.
            (2) Withdrawal and reservation.--
                    (A) Public land.--Subject to valid existing rights, 
                the public land depicted on the map referred to in 
                paragraph (1)(C) is withdrawn from all forms of entry, 
                appropriation, and disposal under the public land laws, 
                including the mineral leasing laws, the geothermal 
                laws, the material sale laws, and the mining laws.
                    (B) Administrative jurisdiction.--Administrative 
                jurisdiction over the land is transferred from the 
                Secretary of the Interior to the Secretary.
                    (C) Reservation.--The land is reserved for the use 
                of the Secretary for the construction and operation of 
                transportation facilities and associated activities 
                under title I of the Nuclear Waste Policy Act of 1982 
                (42 U.S.C. 10121 et seq.)
                    (D) Memorandum of understanding.--The Secretary may 
                also enter into a memorandum of understanding with the 
                head of any other agency having administrative 
                jurisdiction over other Federal land used for purposes 
                of the corridor referred to in paragraph (1)(A).
    (c) Environmental Impact.--
            (1) In general.--The Secretary shall comply with all 
        applicable requirements under the National Environmental Policy 
        Act of 1969 (42 U.S.C. 4321 et seq.) with respect to activities 
        carried out under this section.
            (2) Consideration of potential impacts.--To the extent a 
        Federal agency is required to consider the potential 
        environmental impact of an activity carried out under this 
        section, the Federal agency shall adopt, to the maximum extent 
        practicable, an environmental impact statement prepared under 
        this section.
            (3) Effect of adoption of statement.--The adoption by a 
        Federal agency of an environmental impact statement under 
        paragraph (2) shall be considered to satisfy the 
        responsibilities of the Federal agency under the National 
        Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.), and 
        no further consideration under that subtitle shall be required 
        by the Federal agency.

SEC. 707. NUCLEAR WASTE FUND.

    (a) Budget Act Allocations.--Effective for fiscal year 2008 and 
each fiscal year thereafter, funds appropriated from the Nuclear Waste 
Fund established under section 302 of the Nuclear Waste Policy Act of 
1982 (42 U.S.C. 10222) shall not be subject to--
            (1) the allocations for discretionary spending under 
        section 302(a) of the Congressional Budget Act of 1974 (2 
        U.S.C. 633(a)); or
            (2) the suballocations of appropriations committees under 
        section 302(b) of that Act.
    (b) Fund Uses.--Section 302(d)(4) of the Nuclear Waste Policy Act 
of 1982 (42 U.S.C. 10222(d)(4)) is amended by striking ``with'' and all 
that follows through ``storage site'' and inserting ``with surface 
facilities within the geologic repository operations area (including 
surface facilities for the receipt, handling, packaging, and storage of 
spent nuclear fuel and high-level radioactive waste prior to 
emplacement, or transportation to the repository of spent nuclear fuel 
or high-level radioactive waste to surface facilities for the receipt, 
handling, packaging, and storage of spent nuclear fuel and high-level 
radioactive waste prior to emplacement and the transportation, 
treating, or packaging of spent nuclear fuel or high-level radioactive 
waste to be disposed of in the repository, to be stored in a monitored 
retrievable storage site),''.

SEC. 708. WASTE CONFIDENCE.

    For purposes of a determination by the Nuclear Regulatory 
Commission on whether to grant or amend any license to operate any 
civilian nuclear power reactor or high-level radioactive waste or spent 
fuel storage or treatment facility under the Atomic Energy Act of 1954 
(42 U.S.C. 2011 et seq.), the provisions of this subtitle (including 
the amendments made by this subtitle) and the obligation of the 
Secretary to develop a repository in accordance with the Nuclear Waste 
Policy Act of 1982 (42 U.S.C. 10101 et seq.), shall provide sufficient 
and independent grounds for any further findings by the Nuclear 
Regulatory Commission of reasonable assurances that spent nuclear fuel 
and high-level radioactive waste would be disposed of safely and in a 
timely manner.

                       Subtitle B--Tax Provisions

SEC. 711. INVESTMENT TAX CREDIT FOR INVESTMENTS IN NUCLEAR POWER 
              FACILITIES.

    (a) New Credit for Nuclear Power Facilities.--Section 46 of the 
Internal Revenue Code of 1986, as amended by this Act, is amended--
            (1) by striking ``and'' at the end of paragraph (6),
            (2) by striking the period at the end of paragraph (7) and 
        inserting ``, and'', and
            (3) by inserting after paragraph (7) the following new 
        paragraph:
            ``(8) the nuclear power facility construction credit.''.
    (b) Nuclear Power Facility Construction Credit.--Subpart E of part 
IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986, 
as amended by this Act, is amended by inserting after section 48E the 
following new section:

``SEC. 48F. NUCLEAR POWER FACILITY CONSTRUCTION CREDIT.

    ``(a) In General.--For purposes of section 46, the nuclear power 
facility construction credit for any taxable year is 10 percent of the 
qualified nuclear power facility expenditures with respect to a 
qualified nuclear power facility.
    ``(b) When Expenditures Taken Into Account.--
            ``(1) In general.--Qualified nuclear power facility 
        expenditures shall be taken into account for the taxable year 
        in which the qualified nuclear power facility is placed in 
        service.
            ``(2) Coordination with subsection (c).--The amount which 
        would (but for this paragraph) be taken into account under 
        paragraph (1) with respect to any qualified nuclear power 
        facility shall be reduced (but not below zero) by any amount of 
        qualified nuclear power facility expenditures taken into 
        account under subsection (c) by the taxpayer or a predecessor 
        of the taxpayer (or, in the case of a sale and leaseback 
        described in section 50(a)(2)(C), by the lessee), to the extent 
        any amount so taken into account under subsection (c) has not 
        been required to be recaptured under section 50(a).
    ``(c) Progress Expenditures.--
            ``(1) In general.--A taxpayer may elect to take into 
        account qualified nuclear power facility expenditures--
                    ``(A) Self-constructed property.--In the case of a 
                qualified nuclear power facility which is a self-
                constructed facility, no earlier than the taxable year 
                for which such expenditures are properly chargeable to 
                capital account with respect to such facility, and
                    ``(B) Acquired facility.--In the case of a 
                qualified nuclear facility which is not self-
                constructed property, no earlier than the taxable year 
                in which such expenditures are paid.
            ``(2) Special rules for applying paragraph (1).--For 
        purposes of paragraph (1)--
                    ``(A) Component parts, etc.--Notwithstanding that a 
                qualified nuclear power facility is a self-constructed 
                facility, property described in paragraph (3)(B) shall 
                be taken into account in accordance with paragraph 
                (1)(B), and such amounts shall not be included in 
                determining qualified nuclear power facility 
                expenditures under paragraph (1)(A).
                    ``(B) Certain borrowing disregarded.--Any amount 
                borrowed directly or indirectly by the taxpayer on a 
                nonrecourse basis from the person constructing the 
                facility for the taxpayer shall not be treated as an 
                amount expended for such facility.
                    ``(C) Limitation for facilities or components which 
                are not self-constructed.--
                            ``(i) In general.--In the case of a 
                        facility or a component of a facility which is 
                        not self-constructed, the amount taken into 
                        account under paragraph (1)(B) for any taxable 
                        year shall not exceed the excess of--
                                    ``(I) the product of the overall 
                                cost to the taxpayer of the facility or 
                                component of a facility, multiplied by 
                                the percentage of completion of the 
                                facility or component of a facility, 
                                less
                                    ``(II) the amount taken into 
                                account under paragraph (1)(B) for all 
                                prior taxable years as to such facility 
                                or component of a facility.
                            ``(ii) Carryover of certain amounts.--In 
                        the case of a facility or component of a 
                        facility which is not self-constructed, if for 
                        the taxable year the amount which (but for 
                        clause (i)) would have been taken into account 
                        under paragraph (1)(B) exceeds the amount 
                        allowed by clause (i), then the amount of such 
                        excess shall increase the amount taken into 
                        account under paragraph (1)(B) for the 
                        succeeding taxable year without regard to this 
                        paragraph.
                    ``(D) Determination of percentage of completion.--
                The determination under subparagraph (C) of the portion 
                of the overall cost to the taxpayer of the construction 
                which is properly attributable to construction 
                completed during any taxable year shall be made on the 
                basis of engineering or architectural estimates or on 
                the basis of cost accounting records, using information 
                available at the close of the taxable year in which the 
                credit is being claimed.
                    ``(E) Determination of overall cost.--The 
                determination under subparagraph (C) of the overall 
                cost to the taxpayer of the construction of a facility 
                shall be made on the basis of engineering or 
                architectural estimates or on the basis of cost 
                accounting records, using information available at the 
                close of the taxable year in which the credit is being 
                claimed.
                    ``(F) No progress expenditures for property for 
                year placed in service, etc.--In the case of any 
                qualified nuclear facility, no qualified nuclear 
                facility expenditures shall be taken into account under 
                this subsection for the earlier of--
                            ``(i) the taxable year in which the 
                        facility is placed in service, or
                            ``(ii) the first taxable year for which 
                        recapture is required under section 50(a)(2) 
                        with respect to such facility or for any 
                        taxable year thereafter.
            ``(3) Self-constructed.--For purposes of this subsection--
                    ``(A) The term `self-constructed facility' means 
                any facility if, at the close of the first taxable year 
                to which the election in this subsection applies, it is 
                reasonable to believe that more than 80 percent of the 
                qualified nuclear facility expenditures for such 
                facility will be made directly by the taxpayer.
                    ``(B) A component of a facility shall be treated as 
                not self-constructed if, at the close of the first 
                taxable year in which expenditures for the component 
                are paid, it is reasonable to believe that the cost of 
                the component is at least 5 percent of the expected 
                cost of the facility.
            ``(4) Election.--An election shall be made under this 
        subsection for a qualified nuclear power facility by claiming 
        the nuclear power facility construction credit for expenditures 
        described in paragraph (1) on the taxpayer's return of the tax 
        imposed by this chapter for the taxable year. Such an election 
        shall apply to the taxable year for which made and all 
        subsequent taxable years. Such an election, once made, may be 
        revoked only with the consent of the Secretary.
    ``(d) Definitions and Special Rules.--For purposes of this 
section--
            ``(1) Qualified nuclear power facility.--The term 
        `qualified nuclear power facility' means a facility which, when 
        placed in service, will use nuclear power to produce 
        electricity, the reactor design for which was approved after 
        December 31, 1993 by the Nuclear Regulatory Commission (and 
        such design or a substantially similar design of comparable 
        capacity was not approved on or before such date), and the 
        construction of which was approved by the Nuclear Regulatory 
        Commission on or before December 31, 2013.
            ``(2) Qualified nuclear power facility expenditures.--
                    ``(A) In general.--The term `qualified nuclear 
                power facility expenditures' means any amount paid, 
                accrued, or properly chargeable to capital account--
                            ``(i) with respect to a qualified nuclear 
                        power facility,
                            ``(ii) for which depreciation will be 
                        allowable under section 168 once the facility 
                        is placed in service, and
                            ``(iii) which is incurred before the 
                        qualified nuclear power facility is placed in 
                        service or in connection with the placement of 
                        such facility in service.
                    ``(B) Pre-effective date expenditures.--Qualified 
                nuclear power facility expenditures do not include any 
                expenditures incurred by the taxpayer before January 1, 
                2008, to the extent that, at the close of the first 
                taxable year to which the election in subsection (c) 
                applies, it is reasonable to believe that such 
                expenditures will constitute more than 20 percent of 
                the total qualified nuclear power facility 
                expenditures.
            ``(3) Delays and suspension of construction.--
                    ``(A) In general.--Except as provided in section 
                50(a)(2)(C) and except for sales or dispositions 
                between entities which meet the ownership test in 
                section 1504(a), for purposes of applying this section 
                and section 50, a nuclear power facility that is under 
                construction shall cease, with respect to the taxpayer, 
                to be a qualified nuclear power facility as of the date 
                on which the taxpayer sells, disposes of, or cancels, 
                abandons, or otherwise terminates the construction of, 
                the facility.
                    ``(B) Resumption of construction.--If a nuclear 
                power facility that is under construction ceases, with 
                respect to the taxpayer, to be a qualified nuclear 
                power facility by reason of subparagraph (A) and work 
                is subsequently resumed on the construction of such 
                facility the qualified nuclear power facility 
                expenditures shall be determined without regard to any 
                delay or temporary termination of construction of the 
                facility.
    ``(e) Application of Other Rules.--Rules similar to the rules of 
subsections (c)(4) and (d) of section 46 (as in effect on the day 
before the enactment of the Revenue Reconciliation Act of 1990) shall 
apply for purposes of this section to the extent not inconsistent 
herewith.''.
    (c) Provisions Relating to Credit Recapture.--
            (1) Progress expenditure recapture rules.--
                    (A) Basic rules.--Subparagraph (A) of section 
                50(a)(2) of the Internal Revenue Code of 1986 is 
                amended to read as follows:
                    ``(A) In general.--If during any taxable year any 
                building to which section 47(d) applied or any facility 
                to which section 48F(c) applied ceases (by reason of 
                sale or other disposition, cancellation or abandonment 
                of contract, or otherwise) to be, with respect to the 
                taxpayer, property which, when placed in service, will 
                be a qualified rehabilitated building or a qualified 
                nuclear power facility, then the tax under this chapter 
                for such taxable year shall be increased by an amount 
                equal to the aggregate decrease in the credits allowed 
                under section 38 for all prior taxable years which 
                would have resulted solely from reducing to zero the 
                credit determined under this subpart with respect to 
                such building or facility.''.
                    (B) Amendment to excess credit recapture rule.--
                Subparagraph (B) of section 50(a)(2) of such Code is 
                amended by--
                            (i) inserting ``or paragraph (2) of section 
                        48F(b)'' after ``paragraph (2) of section 
                        47(b)'',
                            (ii) inserting ``or section 48F(b)(1)'' 
                        after ``section 47(b)(1)'', and
                            (iii) inserting ``or facility'' after 
                        ``building''.
                    (C) Amendment of sale and leaseback rule.--
                Subparagraph (C) of section 50(a)(2) of such Code is 
                amended by--
                            (i) inserting ``or section 48F(c)'' after 
                        ``section 47(d)'', and
                            (ii) inserting ``or qualified nuclear power 
                        facility expenditures'' after ``qualified 
                        rehabilitation expenditures''.
                    (D) Other amendment.--Subparagraph (D) of section 
                50(a)(2) of such Code is amended by inserting ``or 
                section 48F(c)'' after ``section 47(d)''.
    (d) No Basis Adjustment.--Section 50(c) of the Internal Revenue 
Code of 1986 is amended by adding at the end the following new 
paragraph:
            ``(6) Nuclear power facility construction credit.--This 
        subsection shall not apply to the nuclear power facility 
        construction credit.''.
    (e) Application of Section 49.--Subparagraph (C) of section 
49(a)(1) of the Internal Revenue Code of 1986, as amended by this Act, 
is amended--
            (1) by striking ``and'' at the end of clause (vi),
            (2) by striking the period at the end of clause (vii) and 
        inserting ``, and'', and
            (3) by inserting after clause (vii) the following new 
        clause:
                            ``(viii) the basis of any property which is 
                        part of a qualified nuclear power facility 
                        under section 48F.''.
    (f) Clerical Amendment.--The table of sections for subpart E of 
part IV of subchapter A of chapter 1 of the Internal Revenue Code of 
1986, as amended by this Act, is amended by inserting after the item 
relating to section 48E the following new item:

``Sec. 48F. Nuclear power facility construction credit.''.
    (g) Effective Date.--The amendments made by this section shall 
apply to expenditures incurred and property placed in service in 
taxable years beginning after the date of enactment of this Act.

SEC. 712. 5-YEAR ACCELERATED DEPRECIATION FOR NEW NUCLEAR POWER 
              FACILITIES.

    (a) In General.--Subparagraph (B) of section 168(e)(3) of the 
Internal Revenue Code of 1986 (relating to 5-year property) is 
amended--
            (1) by striking ``and'' at the end of clause (v),
            (2) by striking the period at the end of clause (vi) and 
        inserting ``, and'', and
            (3) by adding at the end the following new clause:
                            ``(vii) any qualified nuclear power 
                        facility described in section 48F(d)(1).''.
    (b) Effective Date.--The amendments made by this section shall 
apply to property placed in service in taxable years beginning after 
the date of the enactment of this Act.

       TITLE VIII--LEASING PROGRAM FOR LAND WITHIN COASTAL PLAIN

SEC. 801. DEFINITIONS.

    In this title:
            (1) Coastal plain.--The term ``Coastal Plain'' means that 
        area identified as the ``1002 Coastal Plain Area'' on the map.
            (2) Federal agreement.--The term ``Federal Agreement'' 
        means the Federal Agreement and Grant Right-of-Way for the 
        Trans-Alaska Pipeline issued on January 23, 1974, in accordance 
        with section 28 of the Mineral Leasing Act (30 U.S.C. 185) and 
        the Trans-Alaska Pipeline Authorization Act (43 U.S.C. 1651 et 
        seq.).
            (3) Final statement.--The term ``Final Statement'' means 
        the final legislative environmental impact statement on the 
        Coastal Plain, dated April 1987, and prepared pursuant to 
        section 1002 of the Alaska National Interest Lands Conservation 
        Act (16 U.S.C. 3142) and section 102(2)(C) of the National 
        Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)).
            (4) Map.--The term ``map'' means the map entitled ``Arctic 
        National Wildlife Refuge'', dated September 2005, and prepared 
        by the United States Geological Survey.
            (5) Secretary.--The term ``Secretary'' means the Secretary 
        of the Interior (or the designee of the Secretary), acting 
        through the Director of the Bureau of Land Management in 
        consultation with the Director of the United States Fish and 
        Wildlife Service and in coordination with a State coordinator 
        appointed by the Governor of the State of Alaska.

SEC. 802. LEASING PROGRAM FOR LAND WITHIN THE COASTAL PLAIN.

    (a) In General.--
            (1) Authorization.--Congress authorizes the exploration, 
        leasing, development, production, and economically feasible and 
        prudent transportation of oil and gas in and from the Coastal 
        Plain.
            (2) Actions.--The Secretary shall take such actions as are 
        necessary--
                    (A) to establish and implement, in accordance with 
                this title, a competitive oil and gas leasing program 
                that will result in an environmentally sound program 
                for the exploration, development, and production of the 
                oil and gas resources of the Coastal Plain while taking 
                into consideration the interests and concerns of 
                residents of the Coastal Plain, which is the homeland 
                of the Kaktovikmiut Inupiat; and
                    (B) to administer this title through regulations, 
                lease terms, conditions, restrictions, prohibitions, 
                stipulations, and other provisions that--
                            (i) ensure the oil and gas exploration, 
                        development, and production activities on the 
                        Coastal Plain will result in no significant 
                        adverse effect on fish and wildlife, their 
                        habitat, subsistence resources, and the 
                        environment; and
                            (ii) require the application of the best 
                        commercially available technology for oil and 
                        gas exploration, development, and production to 
                        all exploration, development, and production 
                        operations under this title in a manner that 
                        ensures the receipt of fair market value by the 
                        public for the mineral resources to be leased.
    (b) Repeal.--
            (1) Repeal.--Section 1003 of the Alaska National Interest 
        Lands Conservation Act (16 U.S.C. 3143) is repealed.
            (2) Conforming amendment.--The table of contents contained 
        in section 1 of that Act (16 U.S.C. 3101 note) is amended by 
        striking the item relating to section 1003.
    (c) Compliance With Requirements Under Certain Other Laws.--
            (1) Compatibility.--For purposes of the National Wildlife 
        Refuge System Administration Act of 1966 (16 U.S.C. 668dd et 
        seq.)--
                    (A) the oil and gas pre-leasing and leasing 
                program, and activities authorized by this section in 
                the Coastal Plain, shall be considered to be compatible 
                with the purposes for which the Arctic National 
                Wildlife Refuge was established; and
                    (B) no further findings or decisions shall be 
                required to implement that program and those 
                activities.
            (2) Adequacy of the department of the interior's 
        legislative environmental impact statement.--The Final 
        Statement shall be considered to satisfy the requirements under 
        the National Environmental Policy Act of 1969 (42 U.S.C. 4321 
        et seq.) that apply with respect to preleasing activities, 
        including exploration programs and actions authorized to be 
        taken by the Secretary to develop and promulgate the 
        regulations for the establishment of a leasing program 
        authorized by this title before the conduct of the first lease 
        sale.
            (3) Compliance with nepa for other actions.--
                    (A) In general.--Before conducting the first lease 
                sale under this title, the Secretary shall prepare an 
                environmental impact statement in accordance with the 
                National Environmental Policy Act of 1969 (42 U.S.C. 
                4321 et seq.) with respect to the actions authorized by 
                this title that are not referred to in paragraph (2).
                    (B) Identification and analysis.--Notwithstanding 
                any other provision of law, in carrying out this 
                paragraph, the Secretary shall not be required--
                            (i) to identify nonleasing alternative 
                        courses of action; or
                            (ii) to analyze the environmental effects 
                        of those courses of action.
                    (C) Identification of preferred action.--Not later 
                than 18 months after the date of enactment of this Act, 
                the Secretary shall--
                            (i) identify only a preferred action and a 
                        single leasing alternative for the first lease 
                        sale authorized under this title; and
                            (ii) analyze the environmental effects and 
                        potential mitigation measures for those 2 
                        alternatives.
                    (D) Public comments.--In carrying out this 
                paragraph, the Secretary shall consider only public 
                comments that are filed not later than 20 days after 
                the date of publication of a draft environmental impact 
                statement.
                    (E) Effect of compliance.--Notwithstanding any 
                other provision of law, compliance with this paragraph 
                shall be considered to satisfy all requirements for the 
                analysis and consideration of the environmental effects 
                of proposed leasing under this title.
    (d) Relationship to State and Local Authority.--Nothing in this 
title expands or limits any State or local regulatory authority.
    (e) Special Areas.--
            (1) Designation.--
                    (A) In general.--The Secretary, after consultation 
                with the State of Alaska, the North Slope Borough, 
                Alaska, and the City of Kaktovik, Alaska, may designate 
                not more than 45,000 acres of the Coastal Plain as a 
                special area if the Secretary determines that the 
                special area would be of such unique character and 
                interest as to require special management and 
                regulatory protection.
                    (B) Sadlerochit spring area.--The Secretary shall 
                designate as a special area in accordance with 
                subparagraph (A) the Sadlerochit Spring area, 
                comprising approximately 4,000 acres as depicted on the 
                map.
            (2) Management.--The Secretary shall manage each special 
        area designated under this subsection in a manner that--
                    (A) respects and protects the Native people of the 
                area; and
                    (B) preserves the unique and diverse character of 
                the area, including fish, wildlife, subsistence 
                resources, and cultural values of the area.
            (3) Exclusion from leasing or surface occupancy.--
                    (A) In general.--The Secretary may exclude any 
                special area designated under this subsection from 
                leasing.
                    (B) No surface occupancy.--If the Secretary leases 
                all or a portion of a special area for the purposes of 
                oil and gas exploration, development, production, and 
                related activities, there shall be no surface occupancy 
                of the land comprising the special area.
            (4) Directional drilling.--Notwithstanding any other 
        provision of this subsection, the Secretary may lease all or a 
        portion of a special area under terms that permit the use of 
        horizontal drilling technology from sites on leases located 
        outside the special area.
    (f) Limitation on Closed Areas.--The Secretary may not close land 
within the Coastal Plain to oil and gas leasing or to exploration, 
development, or production except in accordance with this title.
    (g) Regulations.--
            (1) In general.--Not later than 15 months after the date of 
        enactment of this Act, in consultation with appropriate 
        agencies of the State of Alaska, the North Slope Borough, 
        Alaska, and the City of Kaktovik, Alaska, the Secretary shall 
        issue such regulations as are necessary to carry out this 
        title, including rules and regulations relating to protection 
        of the fish and wildlife, fish and wildlife habitat, and 
        subsistence resources of the Coastal Plain.
            (2) Revision of regulations.--The Secretary may 
        periodically review and, as appropriate, revise the rules and 
        regulations issued under paragraph (1) to reflect any 
        significant scientific or engineering data that come to the 
        attention of the Secretary.

SEC. 803. LEASE SALES.

    (a) In General.--Land may be leased pursuant to this title to any 
person qualified to obtain a lease for deposits of oil and gas under 
the Mineral Leasing Act (30 U.S.C. 181 et seq.).
    (b) Procedures.--The Secretary shall, by regulation, establish 
procedures for--
            (1) receipt and consideration of sealed nominations for any 
        area in the Coastal Plain for inclusion in, or exclusion (as 
        provided in subsection (c)) from, a lease sale;
            (2) the holding of lease sales after that nomination 
        process; and
            (3) public notice of and comment on designation of areas to 
        be included in, or excluded from, a lease sale.
    (c) Lease Sale Bids.--Bidding for leases under this title shall be 
by sealed competitive cash bonus bids.
    (d) Acreage Minimum in First Sale.--For the first lease sale under 
this title, the Secretary shall offer for lease those tracts the 
Secretary considers to have the greatest potential for the discovery of 
hydrocarbons, taking into consideration nominations received pursuant 
to subsection (b)(1), but in no case less than 200,000 acres.
    (e) Timing of Lease Sales.--The Secretary shall--
            (1) not later than 22 months after the date of enactment of 
        this Act, conduct the first lease sale under this title;
            (2) not later than September 30, 2012, conduct a second 
        lease sale under this title; and
            (3) conduct additional sales at appropriate intervals if 
        sufficient interest in exploration or development exists to 
        warrant the conduct of the additional sales.

SEC. 804. GRANT OF LEASES BY THE SECRETARY.

    (a) In General.--Upon payment by a lessee of such bonus as may be 
accepted by the Secretary, the Secretary may grant to the highest 
responsible qualified bidder in a lease sale conducted pursuant to 
section 803 a lease for any land on the Coastal Plain.
    (b) Subsequent Transfers.--
            (1) In general.--No lease issued under this title may be 
        sold, exchanged, assigned, sublet, or otherwise transferred 
        except with the approval of the Secretary.
            (2) Condition for approval.--Before granting any approval 
        described in paragraph (1), the Secretary shall consult with 
        and give due consideration to the opinion of the Attorney 
        General.

SEC. 805. LEASE TERMS AND CONDITIONS.

    (a) In General.--An oil or gas lease issued pursuant to this title 
shall--
            (1) provide for the payment of a royalty of not less than 
        16\1/2\ percent of the amount or value of the production 
        removed or sold from the lease, as determined by the Secretary 
        in accordance with regulations applicable to other Federal oil 
        and gas leases;
            (2) provide that the Secretary may close, on a seasonal 
        basis, such portions of the Coastal Plain to exploratory 
        drilling activities as are necessary to protect caribou calving 
        areas and other species of fish and wildlife;
            (3) require that each lessee of land within the Coastal 
        Plain shall be fully responsible and liable for the reclamation 
        of land within the Coastal Plain and any other Federal land 
        that is adversely affected in connection with exploration, 
        development, production, or transportation activities within 
        the Coastal Plain conducted by the lessee or by any of the 
        subcontractors or agents of the lessee;
            (4) provide that the lessee may not delegate or convey, by 
        contract or otherwise, that reclamation responsibility and 
        liability to another person without the express written 
        approval of the Secretary;
            (5) provide that the standard of reclamation for land 
        required to be reclaimed under this title shall be, to the 
        maximum extent practicable--
                    (A) a condition capable of supporting the uses that 
                the land was capable of supporting prior to any 
                exploration, development, or production activities; or
                    (B) upon application by the lessee, to a higher or 
                better standard, as approved by the Secretary;
            (6) contain terms and conditions relating to protection of 
        fish and wildlife, fish and wildlife habitat, subsistence 
        resources, and the environment as required under section 
        802(a)(2);
            (7) provide that each lessee, and each agent and contractor 
        of a lessee, use their best efforts to provide a fair share of 
        employment and contracting for Alaska Natives and Alaska Native 
        Corporations from throughout the State of Alaska, as determined 
        by the level of obligation previously agreed to in the Federal 
        Agreement; and
            (8) contain such other provisions as the Secretary 
        determines to be necessary to ensure compliance with this title 
        and regulations issued under this title.
    (b) Project Labor Agreements.--The Secretary, as a term and 
condition of each lease under this title, and in recognizing the 
proprietary interest of the Federal Government in labor stability and 
in the ability of construction labor and management to meet the 
particular needs and conditions of projects to be developed under the 
leases issued pursuant to this title (including the special concerns of 
the parties to those leases), shall require that each lessee, and each 
agent and contractor of a lessee, under this title negotiate to obtain 
a project labor agreement for the employment of laborers and mechanics 
on production, maintenance, and construction under the lease.

SEC. 806. COASTAL PLAIN ENVIRONMENTAL PROTECTION.

    (a) No Significant Adverse Effect Standard To Govern Authorized 
Coastal Plain Activities.--In accordance with section 802, the 
Secretary shall administer this title through regulations, lease terms, 
conditions, restrictions, prohibitions, stipulations, or other 
provisions that--
            (1) ensure, to the maximum extent practicable, that oil and 
        gas exploration, development, and production activities on the 
        Coastal Plain will result in no significant adverse effect on 
        fish and wildlife, fish and wildlife habitat, and the 
        environment;
            (2) require the application of the best commercially 
        available technology for oil and gas exploration, development, 
        and production on all new exploration, development, and 
        production operations; and
            (3) ensure that the maximum surface acreage covered in 
        connection with the leasing program by production and support 
        facilities, including airstrips and any areas covered by gravel 
        berms or piers for support of pipelines, does not exceed 2,000 
        acres on the Coastal Plain.
    (b) Site-Specific Assessment and Mitigation.--The Secretary shall 
require, with respect to any proposed drilling and related activities 
on the Coastal Plain, that--
            (1) a site-specific environmental analysis be made of the 
        probable effects, if any, that the drilling or related 
        activities will have on fish and wildlife, fish and wildlife 
        habitat, subsistence resources, subsistence uses, and the 
        environment;
            (2) a plan be implemented to avoid, minimize, and mitigate 
        (in that order and to the maximum extent practicable) any 
        significant adverse effect identified under paragraph (1); and
            (3) the development of the plan occur after consultation 
        with--
                    (A) each agency having jurisdiction over matters 
                mitigated by the plan;
                    (B) the State of Alaska;
                    (C) North Slope Borough, Alaska; and
                    (D) the City of Kaktovik, Alaska.
    (c) Regulations To Protect Coastal Plain Fish and Wildlife 
Resources, Subsistence Users, and the Environment.--Before implementing 
the leasing program authorized by this title, the Secretary shall 
prepare and issue regulations, lease terms, conditions, restrictions, 
prohibitions, stipulations, or other measures designed to ensure, to 
the maximum extent practicable, that the activities carried out on the 
Coastal Plain under this title are conducted in a manner consistent 
with the purposes and environmental requirements of this title.
    (d) Compliance With Federal and State Environmental Laws and Other 
Requirements.--The proposed regulations, lease terms, conditions, 
restrictions, prohibitions, and stipulations for the leasing program 
under this title shall require--
            (1) compliance with all applicable provisions of Federal 
        and State environmental law (including regulations);
            (2) implementation of and compliance with--
                    (A) standards that are at least as effective as the 
                safety and environmental mitigation measures, as 
                described in items 1 through 29 on pages 167 through 
                169 of the Final Statement, on the Coastal Plain;
                    (B) seasonal limitations on exploration, 
                development, and related activities, as necessary, to 
                avoid significant adverse effects during periods of 
                concentrated fish and wildlife breeding, denning, 
                nesting, spawning, and migration;
                    (C) design safety and construction standards for 
                all pipelines and any access and service roads that 
                minimize, to the maximum extent practicable, adverse 
                effects on--
                            (i) the passage of migratory species (such 
                        as caribou); and
                            (ii) the flow of surface water by requiring 
                        the use of culverts, bridges, or other 
                        structural devices;
                    (D) prohibitions on general public access to, and 
                use of, all pipeline access and service roads;
                    (E) stringent reclamation and rehabilitation 
                requirements in accordance with this title for the 
                removal from the Coastal Plain of all oil and gas 
                development and production facilities, structures, and 
                equipment on completion of oil and gas production 
                operations, except in a case in which the Secretary 
                determines that those facilities, structures, or 
                equipment--
                            (i) would assist in the management of the 
                        Arctic National Wildlife Refuge; and
                            (ii) are donated to the United States for 
                        that purpose;
                    (F) appropriate prohibitions or restrictions on--
                            (i) access by all modes of transportation;
                            (ii) sand and gravel extraction; and
                            (iii) use of explosives;
                    (G) reasonable stipulations for protection of 
                cultural and archaeological resources;
                    (H) measures to protect groundwater and surface 
                water, including--
                            (i) avoidance, to the maximum extent 
                        practicable, of springs, streams, and river 
                        systems;
                            (ii) the protection of natural surface 
                        drainage patterns and wetland and riparian 
                        habitats; and
                            (iii) the regulation of methods or 
                        techniques for developing or transporting 
                        adequate supplies of water for exploratory 
                        drilling; and
                    (I) research, monitoring, and reporting 
                requirements;
            (3) that exploration activities (except surface geological 
        studies) be limited to the period between approximately 
        November 1 and May 1 of each year and be supported, if 
        necessary, by ice roads, winter trails with adequate snow 
        cover, ice pads, ice airstrips, and air transport methods 
        (except that those exploration activities may be permitted at 
        other times if the Secretary determines that the exploration 
        will have no significant adverse effect on fish and wildlife, 
        fish and wildlife habitat, subsistence resources, and the 
        environment of the Coastal Plain);
            (4) consolidation of facility siting;
            (5) avoidance or reduction of air traffic-related 
        disturbance to fish and wildlife;
            (6) treatment and disposal of hazardous and toxic wastes, 
        solid wastes, reserve pit fluids, drilling muds and cuttings, 
        and domestic wastewater, including, in accordance with 
        applicable Federal and State environmental laws (including 
        regulations)--
                    (A) preparation of an annual waste management 
                report;
                    (B) development and implementation of a hazardous 
                materials tracking system; and
                    (C) prohibition on the use of chlorinated solvents;
            (7) fuel storage and oil spill contingency planning;
            (8) conduct of periodic field crew environmental briefings;
            (9) avoidance of significant adverse effects on subsistence 
        hunting, fishing, and trapping;
            (10) compliance with applicable air and water quality 
        standards;
            (11) appropriate seasonal and safety zone designations 
        around well sites, within which subsistence hunting and 
        trapping shall be limited; and
            (12) development and implementation of such other 
        protective environmental requirements, restrictions, terms, or 
        conditions as the Secretary, after consultation with the State 
        of Alaska, North Slope Borough, Alaska, and the City of 
        Kaktovik, Alaska, determines to be necessary.
    (e) Considerations.--In preparing and issuing regulations, lease 
terms, conditions, restrictions, prohibitions, or stipulations under 
this section, the Secretary shall take into consideration--
            (1) the stipulations and conditions that govern the 
        National Petroleum Reserve-Alaska leasing program, as set forth 
        in the 1999 Northeast National Petroleum Reserve-Alaska Final 
        Integrated Activity Plan/Environmental Impact Statement;
            (2) the environmental protection standards that governed 
        the initial Coastal Plain seismic exploration program under 
        parts 37.31 through 37.33 of title 50, Code of Federal 
        Regulations (or successor regulations); and
            (3) the land use stipulations for exploratory drilling on 
        the KIC-ASRC private land described in Appendix 2 of the 
        agreement between Arctic Slope Regional Corporation and the 
        United States dated August 9, 1983.
    (f) Facility Consolidation Planning.--
            (1) In general.--After providing for public notice and 
        comment, the Secretary shall prepare and periodically update a 
        plan to govern, guide, and direct the siting and construction 
        of facilities for the exploration, development, production, and 
        transportation of oil and gas resources from the Coastal Plain.
            (2) Objectives.--The objectives of the plan shall be--
                    (A) the avoidance of unnecessary duplication of 
                facilities and activities;
                    (B) the encouragement of consolidation of common 
                facilities and activities;
                    (C) the location or confinement of facilities and 
                activities to areas that will minimize impact on fish 
                and wildlife, fish and wildlife habitat, subsistence 
                resources, and the environment;
                    (D) the use of existing facilities, to the maximum 
                extent practicable; and
                    (E) the enhancement of compatibility between 
                wildlife values and development activities.
    (g) Access to Public Land.--The Secretary shall--
            (1) manage public land in the Coastal Plain in accordance 
        with subsections (a) and (b) of section 811 of the Alaska 
        National Interest Lands Conservation Act (16 U.S.C. 3121); and
            (2) ensure that local residents shall have reasonable 
        access to public land in the Coastal Plain for traditional 
        uses.

SEC. 807. EXPEDITED JUDICIAL REVIEW.

    (a) Filing of Complaints.--
            (1) Deadline.--A complaint seeking judicial review of a 
        provision of this title or an action of the Secretary under 
        this title shall be filed--
                    (A) except as provided in subparagraph (B), during 
                the 90-day period beginning on the date on which the 
                action being challenged was carried out; or
                    (B) in the case of a complaint based solely on 
                grounds arising after the 90-day period described in 
                subparagraph (A), during the 90-day period beginning on 
                the date on which the complainant knew or reasonably 
                should have known about the grounds for the complaint.
            (2) Venue.--A complaint seeking judicial review of a 
        provision of this title or an action of the Secretary under 
        this title shall be filed in the United States Court of Appeals 
        for the District of Columbia.
            (3) Scope.--
                    (A) In general.--Judicial review of a decision of 
                the Secretary under this title (including an 
                environmental analysis of such a lease sale) shall be--
                            (i) limited to a review of whether the 
                        decision is in accordance with this title; and
                            (ii) based on the administrative record of 
                        the decision.
                    (B) Presumptions.--Any identification by the 
                Secretary of a preferred course of action relating to a 
                lease sale, and any analysis by the Secretary of 
                environmental effects, under this title shall be 
                presumed to be correct unless proven otherwise by clear 
                and convincing evidence.
    (b) Limitation on Other Review.--Any action of the Secretary that 
is subject to judicial review under this section shall not be subject 
to judicial review in any civil or criminal proceeding for enforcement.

SEC. 808. RIGHTS-OF-WAY AND EASEMENTS ACROSS COASTAL PLAIN.

    For purposes of section 1102(4)(A) of the Alaska National Interest 
Lands Conservation Act (16 U.S.C. 3162(4)(A)), any rights-of-way or 
easements across the Coastal Plain for the exploration, development, 
production, or transportation of oil and gas shall be considered to be 
established incident to the management of the Coastal Plain under this 
section.

SEC. 809. CONVEYANCE.

    Notwithstanding section 1302(h)(2) of the Alaska National Interest 
Lands Conservation Act (16 U.S.C. 3192(h)(2)), to remove any cloud on 
title to land, and to clarify land ownership patterns in the Coastal 
Plain, the Secretary shall--
            (1) to the extent necessary to fulfill the entitlement of 
        the Kaktovik Inupiat Corporation under sections 12 and 14 of 
        the Alaska Native Claims Settlement Act (43 U.S.C. 1611, 1613), 
        as determined by the Secretary, convey to that Corporation the 
        surface estate of the land described in paragraph (1) of Public 
        Land Order 6959, in accordance with the terms and conditions of 
        the agreement between the Secretary, the United States Fish and 
        Wildlife Service, the Bureau of Land Management, and the 
        Kaktovik Inupiat Corporation, dated January 22, 1993; and
            (2) convey to the Arctic Slope Regional Corporation the 
        remaining subsurface estate to which that Corporation is 
        entitled under the agreement between that corporation and the 
        United States, dated August 9, 1983.

SEC. 810. LOCAL GOVERNMENT IMPACT AID AND COMMUNITY SERVICE ASSISTANCE.

    (a) Establishment of Fund.--
            (1) In general.--As a condition on the receipt of funds 
        under section 812(2), the State of Alaska shall establish in 
        the treasury of the State, and administer in accordance with 
        this section, a fund to be known as the ``Coastal Plain Local 
        Government Impact Aid Assistance Fund'' (referred to in this 
        section as the ``Fund'').
            (2) Deposits.--Subject to paragraph (1), the Secretary of 
        the Treasury shall deposit into the Fund, $35,000,000 each year 
        from the amount available under section 812(2)(A).
            (3) Investment.--The Governor of the State of Alaska 
        (referred to in this section as the ``Governor'') shall invest 
        amounts in the Fund in interest-bearing securities of the 
        United States or the State of Alaska.
    (b) Assistance.--The Governor, in cooperation with the Mayor of the 
North Slope Borough, shall use amounts in the Fund to provide 
assistance to North Slope Borough, Alaska, the City of Kaktovik, 
Alaska, and any other borough, municipal subdivision, village, or other 
community in the State of Alaska that is directly impacted by 
exploration for, or the production of, oil or gas on the Coastal Plain 
under this title, or any Alaska Native Regional Corporation acting on 
behalf of the villages and communities within its region whose lands 
lie along the right of way of the Trans Alaska Pipeline System, as 
determined by the Governor.
    (c) Application.--
            (1) In general.--To receive assistance under subsection 
        (b), a community or Regional Corporation described in that 
        subsection shall submit to the Governor, or to the Mayor of the 
        North Slope Borough, an application in such time, in such 
        manner, and containing such information as the Governor may 
        require.
            (2) Action by north slope borough.--The Mayor of the North 
        Slope Borough shall submit to the Governor each application 
        received under paragraph (1) as soon as practicable after the 
        date on which the application is received.
            (3) Assistance of governor.--The Governor shall assist 
        communities in submitting applications under this subsection, 
        to the maximum extent practicable.
    (d) Use of Funds.--A community or Regional Corporation that 
receives funds under subsection (b) may use the funds--
            (1) to plan for mitigation, implement a mitigation plan, or 
        maintain a mitigation project to address the potential effects 
        of oil and gas exploration and development on environmental, 
        social, cultural, recreational, and subsistence resources of 
        the community;
            (2) to develop, carry out, and maintain--
                    (A) a project to provide new or expanded public 
                facilities; or
                    (B) services to address the needs and problems 
                associated with the effects described in paragraph (1), 
                including firefighting, police, water and waste 
                treatment, first responder, and other medical services;
            (3) to compensate residents of the Coastal Plain for 
        significant damage to environmental, social, cultural, 
        recreational, or subsistence resources; and
            (4) in the City of Kaktovik, Alaska--
                    (A) to develop a mechanism for providing members of 
                the Kaktovikmiut Inupiat community an opportunity to--
                            (i) monitor development on the Coastal 
                        Plain; and
                            (ii) provide information and 
                        recommendations to the Governor based on 
                        traditional aboriginal knowledge of the natural 
                        resources, flora, fauna, and ecological 
                        processes of the Coastal Plain; and
                    (B) to establish a local coordination office, to be 
                managed by the Mayor of the North Slope Borough, in 
                coordination with the City of Kaktovik, Alaska--
                            (i) to coordinate with and advise 
                        developers on local conditions and the history 
                        of areas affected by development;
                            (ii) to provide to the Committee on 
                        Resources of the House of Representatives and 
                        the Committee on Energy and Natural Resources 
                        of the Senate annual reports on the status of 
                        the coordination between developers and 
                        communities affected by development;
                            (iii) to collect from residents of the 
                        Coastal Plain information regarding the impacts 
                        of development on fish, wildlife, habitats, 
                        subsistence resources, and the environment of 
                        the Coastal Plain; and
                            (iv) to ensure that the information 
                        collected under clause (iii) is submitted to--
                                    (I) developers; and
                                    (II) any appropriate Federal 
                                agency.

SEC. 811. PROHIBITION ON EXPORTS.

    An oil or gas lease issued under this title shall prohibit the 
exportation of oil or gas produced under the lease.

SEC. 812. ALLOCATION OF REVENUES.

    Notwithstanding the Mineral Leasing Act (30 U.S.C. 181 et seq.) or 
any other provision of law, of the adjusted bonus, rental, and royalty 
receipts from Federal oil and gas leasing and operations authorized 
under this title:
            (1) 50 percent shall be deposited in the general fund of 
        the Treasury.
            (2) The remainder shall be available as follows:
                    (A) $35,000,000 shall be deposited by the Secretary 
                of the Treasury into the fund created under section 
                810(a)(1).
                    (B) The remainder shall be disbursed to the State 
                of Alaska.
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