I 111th CONGRESS 1st Session H. R. 1847 IN THE HOUSE OF REPRESENTATIVES April 1, 2009 Mrs. Capito (for herself and Mr. Shimkus) introduced the following bill; which was referred to the Committee on Energy and Commerce A BILL To require the inclusion of coal-derived fuel at certain volumes in aviation fuel, motor vehicle fuel, home heating oil, and boiler fuel.

1.

Short title

This Act may be cited as the Clean Coal-Derived Fuels for Energy Security Act of 2009.

2.

Definitions

In this Act: (1)

Clean coal-derived fuel

(A)

In general

The term clean coal-derived fuel means aviation fuel, motor vehicle fuel, home heating oil, or boiler fuel that is— (i)substantially derived from the coal resources of the United States; and (ii)refined or otherwise processed at a facility located in the United States that captures up to 100 percent of the carbon dioxide emissions that would otherwise be released at the facility. (B)

Inclusions

The term clean coal-derived fuel may include any other resource that is extracted, grown, produced, or recovered in the United States. (2)

Covered fuel

The term covered fuel means— (A)aviation fuel; (B)motor vehicle fuel; (C)home heating oil; and (D)boiler fuel. (3)

Small refinery

The term small refinery means a refinery for which the average aggregate daily crude oil throughput for a calendar year (as determined by dividing the aggregate throughput for the calendar year by the number of days in the calendar year) does not exceed 75,000 barrels.

3.

Clean coal-derived fuel program

(a)

Program

(1)

In general

Not later than 1 year after the date of enactment of this Act, the President shall promulgate regulations to ensure that covered fuel sold or introduced into commerce in the United States (except in noncontiguous States or territories), on an annual average basis, contains the applicable volume of clean coal-derived fuel determined in accordance with paragraph (4). (2)

Provisions of regulations

Regardless of the date of promulgation, the regulations promulgated under paragraph (1)— (A)shall contain compliance provisions applicable to refineries, blenders, distributors, and importers, as appropriate, to ensure that— (i)the requirements of this subsection are met; and (ii)clean coal-derived fuels produced from facilities for the purpose of compliance with this Act result in life cycle greenhouse gas emissions that are not greater than gasoline; and (B)shall not— (i)restrict geographic areas in the contiguous United States in which clean coal-derived fuel may be used; or (ii)impose any per-gallon obligation for the use of clean coal-derived fuel. (3)

Relationship to other regulations

Regulations promulgated under this paragraph shall, to the maximum extent practicable, incorporate the program structure, compliance and reporting requirements established under the final regulations promulgated to implement the renewable fuel program established by the amendment made by section 1501(a)(2) of the Energy Policy Act of 2005 (Public Law 109–58; 119 Stat. 1067). (4)

Applicable volume

(A)

Calendar years 2015 through 2022

For the purpose of this subsection, the applicable volume for any of calendar years 2015 through 2022 shall be determined in accordance with the following table: Applicable volume of clean coal-derived fuel Calendar year:(in billions of gallons): 20150.75 20161.5 20172.25 20183.00 20193.75 20204.5 20215.25 20226.0. (B)

Calendar year 2023 and thereafter

Subject to subparagraph (C), for the purposes of this subsection, the applicable volume for calendar year 2023 and each calendar year thereafter shall be determined by the President, in coordination with the Secretary and the Administrator of the Environmental Protection Agency, based on a review of the implementation of the program during calendar years 2015 through 2022, including a review of— (i)the impact of clean coal-derived fuels on the energy security of the United States; (ii)the expected annual rate of future production of clean coal-derived fuels; and (iii)the impact of the use of clean coal-derived fuels on other factors, including job creation, rural economic development, and the environment. (C)

Minimum applicable volume

For the purpose of this subsection, the applicable volume for calendar year 2023 and each calendar year thereafter shall be equal to the product obtained by multiplying— (i)the number of gallons of covered fuel that the President estimates will be sold or introduced into commerce in the calendar year; and (ii)the ratio that— (I)6,000,000,000 gallons of clean coal-derived fuel; bears to (II)the number of gallons of covered fuel sold or introduced into commerce in calendar year 2022. (b)

Applicable percentages

(1)

Provision of estimate of volumes of certain fuel sales

Not later than October 31 of each of calendar years 2015 through 2021, the Administrator of the Energy Information Administration shall provide to the President an estimate, with respect to the following calendar year, of the volumes of covered fuel projected to be sold or introduced into commerce in the United States. (2)

Determination of applicable percentages

(A)

In general

Not later than November 30 of each of calendar years 2015 through 2022, based on the estimate provided under paragraph (1), the President shall determine and publish in the Federal Register, with respect to the following calendar year, the clean coal-derived fuel obligation that ensures that the requirements of subsection (a) are met. (B)

Required elements

The clean coal-derived fuel obligation determined for a calendar year under subparagraph (A) shall— (i)be applicable to refineries, blenders, and importers, as appropriate; (ii)be expressed in terms of a volume percentage of covered fuel sold or introduced into commerce in the United States; and (iii)subject to paragraph (3)(A), consist of a single applicable percentage that applies to all categories of persons specified in clause (i). (3)

Adjustments

In determining the applicable percentage for a calendar year, the President shall make adjustments— (A)to prevent the imposition of redundant obligations on any person specified in paragraph (2)(B)(i); and (B)to account for the use of clean coal-derived fuel during the previous calendar year by small refineries that are exempt under subsection (f). (c)

Volume conversion factors for clean coal-derived fuels based on energy content

(1)

In general

For the purpose of subsection (a), the President shall assign values to specific types of clean coal-derived fuel for the purpose of satisfying the fuel volume requirements of subsection (a)(4) in accordance with this subsection. (2)

Energy content relative to diesel fuel

For clean coal-derived fuels, 1 gallon of the clean coal-derived fuel shall be considered to be the equivalent of 1 gallon of diesel fuel multiplied by the ratio that— (A)the number of British thermal units of energy produced by the combustion of 1 gallon of the clean coal-derived fuel (as measured under conditions determined by the Secretary); bears to (B)the number of British thermal units of energy produced by the combustion of 1 gallon of diesel fuel (as measured under conditions determined by the Secretary to be comparable to conditions described in subparagraph (A)). (d)

Credit program

(1)

In general

The President, in consultation with the Secretary and the clean coal-derived fuel requirement of this section. (2)

Market transparency

In carrying out the credit program under this subsection, the President shall facilitate price transparency in markets for the sale and trade of credits, with due regard for the public interest, the integrity of those markets, fair competition, and the protection of consumers. (e)

Waivers

(1)

In general

The President, in consultation with the Secretary and the Administrator of the Environmental Protection Agency, may waive the requirements of subsection (a) in whole or in part on petition by 1 or more States by reducing the national quantity of clean coal-derived fuel required under subsection (a), based on a determination by the President (after public notice and opportunity for comment), that— (A)implementation of the requirement would severely harm the economy or environment of a State, a region, or the United States; or (B)extreme and unusual circumstances exist that prevent distribution of an adequate supply of domestically produced clean coal-derived fuel to consumers in the United States. (2)

Petitions for waivers

The President, in consultation with the Secretary and the Administrator of the Environmental Protection Agency, shall approve or disapprove a State petition for a waiver of the requirements of subsection (a) within 90 days after the date on which the petition is received by the President. (3)

Termination of waivers

A waiver granted under paragraph (1) shall terminate after 1 year, but may be renewed by the President after consultation with the Secretary and the Administrator of the Environmental Protection Agency. (f)

Small refineries

(1)

Temporary exemption

(A)

In general

The requirements of subsection (a) shall not apply to small refineries until calendar year 2018. (B)

Extension of exemption

(i)

Study by Secretary

Not later than December 31, 2013, the Secretary shall submit to the President and Congress a report describing the results of a study to determine whether compliance with the requirements of subsection (a) would impose a disproportionate economic hardship on small refineries. (ii)

Extension of exemption

In the case of a small refinery that the Secretary determines under clause (i) would be subject to a disproportionate economic hardship if required to comply with subsection (a), the President shall extend the exemption under subparagraph (A) for the small refinery for a period of not less than 2 additional years. (2)

Petitions based on disproportionate economic hardship

(A)

Extension of exemption

A small refinery may at any time petition the President for an extension of the exemption under paragraph (1) for the reason of disproportionate economic hardship. (B)

Evaluation of petitions

In evaluating a petition under subparagraph (A), the President, in consultation with the Secretary, shall consider the findings of the study under paragraph (1)(B) and other economic factors. (C)

Deadline for action on petitions

The President shall act on any petition submitted by a small refinery for a hardship exemption not later than 90 days after the date of receipt of the petition. (3)

Opt-in for small refineries

A small refinery shall be subject to the requirements of subsection (a) if the small refinery notifies the President that the small refinery waives the exemption under paragraph (1). (g)

Penalties and enforcement

(1)

Civil penalties

(A)

In general

Any person that violates a regulation promulgated under subsection (a), or that fails to furnish any information required under such a regulation, shall be liable to the United States for a civil penalty of not more than the total of— (i)$25,000 for each day of the violation; and (ii)the amount of economic benefit or savings received by the person resulting from the violation, as determined by the President. (B)

Collection

Civil penalties under subparagraph (A) shall be assessed by, and collected in a civil action brought by, the Secretary or such other officer of the United States as is designated by the President. (2)

Injunctive authority

(A)

In general

The district courts of the United States shall have jurisdiction to— (i)restrain a violation of a regulation promulgated under subsection (a); (ii)award other appropriate relief; and (iii)compel the furnishing of information required under the regulation. (B)

Actions

An action to restrain such violations and compel such actions shall be brought by and in the name of the United States. (C)

Subpoenas

In the action, a subpoena for a witness who is required to attend a district court in any district may apply in any other district. (h)

Effective date

Except as otherwise specifically provided in this section, this section takes effect on January 1, 2015.