[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2454 Placed on Calendar Senate (PCS)]
Calendar No. 97
111th CONGRESS
1st Session
H. R. 2454
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
July 6, 2009
Received and read the first time
July 7, 2009
Read the second time and placed on the calendar
_______________________________________________________________________
AN ACT
To create clean energy jobs, achieve energy independence, reduce global
warming pollution and transition to a clean energy economy.
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 ``American Clean
Energy and Security Act of 2009''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. International participation.
TITLE I--CLEAN ENERGY
Subtitle A--Combined Efficiency and Renewable Electricity Standard
Sec. 101. Combined efficiency and renewable electricity standard.
``Sec. 610. Combined efficiency and renewable electricity
standard.
Sec. 102. Clarifying State authority to adopt renewable energy
incentives.
Sec. 103. Federal renewable energy purchases.
Subtitle B--Carbon Capture and Sequestration
Sec. 111. National strategy.
Sec. 112. Regulations for geologic sequestration sites.
``Sec. 813. Geologic sequestration sites.
Sec. 113. Studies and reports.
Sec. 114. Carbon capture and sequestration demonstration and early
deployment program.
Sec. 115. Commercial deployment of carbon capture and sequestration
technologies.
``Sec. 786. Commercial deployment of carbon capture and
sequestration technologies.
Sec. 116. Performance standards for coal-fueled power plants.
``Sec. 812. Performance standards for new coal-fired power
plants.
Subtitle C--Clean Transportation
Sec. 121. Electric vehicle infrastructure.
Sec. 122. Large-scale vehicle electrification program.
Sec. 123. Plug-in electric drive vehicle manufacturing.
Sec. 124. Investment in clean vehicles.
Sec. 125. Advanced technology vehicle manufacturing incentive loans.
Sec. 126. Definition of renewable biomass.
Sec. 127. Open fuel standard.
``Sec. 32920. Open fuel standard for transportation.
Sec. 128. Diesel emissions reduction.
Sec. 129. Loan guarantees for projects to construct renewable fuel
pipelines.
Sec. 130. Fleet vehicles.
Sec. 130A. Report on natural gas vehicle emissions reductions.
Subtitle D--State Energy and Environment Development Accounts
Sec. 131. Establishment of SEED Accounts.
Sec. 132. Support of State renewable energy and energy efficiency
programs.
Sec. 133. Support of Indian renewable energy and energy efficiency
programs.
Subtitle E--Smart Grid Advancement
Sec. 141. Definitions.
Sec. 142. Assessment of Smart Grid cost effectiveness in products.
Sec. 143. Inclusions of Smart Grid capability on appliance ENERGY GUIDE
labels.
Sec. 144. Smart Grid peak demand reduction goals.
Sec. 145. Reauthorization of energy efficiency public information
program to include Smart Grid information.
Sec. 146. Inclusion of Smart Grid features in appliance rebate program.
Subtitle F--Transmission Planning
Sec. 151. Transmission planning and siting.
``Sec. 216A Transmission planning.
``Sec. 216B. Siting and construction in the Western
Interconnection.
Sec. 152. Net metering for Federal agencies.
Sec. 153. Support for qualified advanced electric transmission
manufacturing plants, qualified high
efficiency transmission property, and
qualified advanced electric transmission
property.
Subtitle G--Technical Corrections to Energy Laws
Sec. 161. Technical corrections to Energy Independence and Security Act
of 2007.
Sec. 162. Technical corrections to Energy Policy Act of 2005.
Subtitle H--Energy and Efficiency Centers and Research
Sec. 171. Energy Innovation Hubs.
Sec. 172. Advanced energy research.
Sec. 173. Building Assessment Centers.
Sec. 174. Centers for Energy and Environmental Knowledge and Outreach.
Sec. 175. High efficiency gas turbine research, development, and
demonstration.
Subtitle I--Nuclear and Advanced Technologies
Sec. 181. Revisions to loan guarantee program authority.
Sec. 182. Purpose.
Sec. 183. Definitions.
Sec. 184. Clean energy investment fund.
Sec. 185. Energy technology deployment goals.
Sec. 186. Clean energy deployment administration.
Sec. 187. Direct support.
Sec. 188. Indirect support.
Sec. 189. Federal credit authority.
Sec. 190. General provisions.
Sec. 191. Conforming amendments.
Subtitle J--Miscellaneous
Sec. 195. Increased hydroelectric generation at existing Federal
facilities.
Sec. 196. Clean technology business competition grant program.
Sec. 197. National Bioenergy Partnership.
Sec. 198. Office of Consumer Advocacy.
``Sec. 319. Office of Consumer Advocacy.
Sec. 199. Development corporation for renewable power borrowing
authority.
Sec. 199A. Study.
TITLE II--ENERGY EFFICIENCY
Subtitle A--Building Energy Efficiency Programs
Sec. 201. Greater energy efficiency in building codes.
``Sec. 304. Greater energy efficiency in building codes.
Sec. 202. Building retrofit program.
Sec. 203. Energy efficient manufactured homes.
Sec. 204. Building energy performance labeling program.
Sec. 205. Tree planting programs.
Sec. 206. Energy efficiency for data center buildings.
Sec. 207. Community building code administration grants.
Sec. 208. Solar energy systems building permit requirements for receipt
of community development block grant funds.
Sec. 209. Prohibition of restrictions on residential installation of
solar energy system.
Subtitle B--Lighting and Appliance Energy Efficiency Programs
Sec. 211. Lighting efficiency standards.
Sec. 212. Other appliance efficiency standards.
Sec. 213. Appliance efficiency determinations and procedures.
``Sec. 334. Jurisdiction and venue.
Sec. 214. Best-in-Class Appliances Deployment Program.
Sec. 215. WaterSense.
Sec. 216. Federal procurement of water efficient products.
Sec. 217. Early adopter water efficient product incentive programs.
Sec. 218. Certified stoves program.
Sec. 219. Energy Star standards.
Subtitle C--Transportation Efficiency
Sec. 221. Emissions standards.
``Part B--Mobile Sources
``Sec. 821. Greenhouse gas emission standards for mobile
sources.
Sec. 222. Greenhouse gas emissions reductions through transportation
efficiency.
``Part D--Transportation Emissions
``Sec. 841. Greenhouse gas emissions reductions through
transportation efficiency.
Sec. 223. SmartWay transportation efficiency program.
``Sec. 822. SmartWay transportation efficiency program.
Sec. 224. State vehicle fleets.
Subtitle D--Industrial Energy Efficiency Programs
Sec. 241. Industrial plant energy efficiency standards.
Sec. 242. Electric and thermal waste energy recovery award program.
Sec. 243. Clarifying election of waste heat recovery financial
incentives.
Sec. 244. Motor market assessment and commercial awareness program.
Sec. 245. Motor efficiency rebate program.
``Sec. 347. Motor efficiency rebate program.
Sec. 246. Clean energy manufacturing revolving loan fund program.
``Sec. 27. Clean energy manufacturing revolving loan fund
program.
Sec. 247. Clean energy and efficiency manufacturing partnerships.
Sec. 248. Technical amendments.
Subtitle E--Improvements in Energy Savings Performance Contracting
Sec. 251. Energy savings performance contracts.
Subtitle F--Public Institutions
Sec. 261. Public institutions.
Sec. 262. Community energy efficiency flexibility.
Sec. 263. Small community joint participation.
Sec. 264. Low income community energy efficiency program.
Sec. 265. Consumer behavior research.
Subtitle G--Miscellaneous
Sec. 271. Energy efficient information and communications technologies.
``Sec. 543. Energy efficient information and communications
technologies.
Sec. 272. National energy efficiency goals.
Sec. 273. Affiliated island energy independence team.
Sec. 274. Product carbon disclosure program.
Sec. 275. Industrial energy efficiency education and training
initiative.
Sec. 276. Sense of Congress.
Subtitle H--Green Resources for Energy Efficient Neighborhoods
Sec. 281. Short title.
Sec. 282. Definitions.
Sec. 283. Implementation of energy efficiency participation incentives
for HUD programs.
Sec. 284. Basic HUD energy efficiency standards and standards for
additional credit.
Sec. 285. Energy efficiency and conservation demonstration program for
multifamily housing projects assisted with
project-based rental assistance.
Sec. 286. Additional credit for Fannie Mae and Freddie Mac housing
goals for energy-efficient and location-
efficient mortgages.
Sec. 287. Duty to serve underserved markets for energy-efficient and
location-efficient mortgages.
Sec. 288. Consideration of energy efficiency under FHA mortgage
insurance programs and Native American and
Native Hawaiian loan guarantee programs.
``Sec. 543. Consideration of energy efficiency.
Sec. 289. Energy-efficient mortgages and location-efficient mortgages
education and outreach campaign.
Sec. 290. Collection of information on energy-efficient and location-
efficient mortgages through Home Mortgage
Disclosure Act.
Sec. 291. Ensuring availability of homeowners insurance for homes not
connected to electricity grid.
Sec. 292. Mortgage incentives for energy-efficient multifamily housing.
Sec. 293. Energy-efficient certifications for manufactured housing with
mortgages.
Sec. 294. Assisted housing energy loan pilot program.
Sec. 295. Making it green.
Sec. 296. Residential energy efficiency block grant program.
``Sec. 123. Residential energy efficiency block grant program.
Sec. 297. Including sustainable development and transportation
strategies in comprehensive housing
affordability strategies.
Sec. 298. Grant program to increase sustainable low-income community
development capacity.
Sec. 299. HOPE VI green developments requirement.
Sec. 299A. Consideration of energy efficiency improvements in
appraisals.
Sec. 299B. Housing Assistance Council.
Sec. 299C. Rural housing and economic development assistance.
Sec. 299D. Loans to States and Indian tribes to carry out renewable
energy sources activities.
Sec. 299E. Green banking centers.
Sec. 299F. GAO reports on availability of affordable mortgages.
Sec. 299G. Public housing energy cost report.
Sec. 299H. Secondary market for residential renewable energy lease
instruments.
Sec. 299I. Green guarantees.
TITLE III--REDUCING GLOBAL WARMING POLLUTION
Sec. 301. Short title.
Subtitle A--Reducing Global Warming Pollution
Sec. 311. Reducing global warming pollution.
``TITLE VII--GLOBAL WARMING POLLUTION REDUCTION PROGRAM
``Part A--Global Warming Pollution Reduction Goals and Targets
``Sec. 701. Findings and purpose.
``Sec. 702. Economy-wide reduction goals.
``Sec. 703. Reduction targets for specified sources.
``Sec. 704. Supplemental pollution reductions.
``Sec. 705. Review and program recommendations.
``Sec. 706. National Academy review.
``Sec. 707. Presidential response and recommendations.
``Part B--Designation and Registration of Greenhouse Gases
``Sec. 711. Designation of greenhouse gases.
``Sec. 712. Carbon dioxide equivalent value of greenhouse
gases.
``Sec. 713. Greenhouse gas registry.
``Part C--Program Rules
``Sec. 721. Emission allowances.
``Sec. 722. Prohibition of excess emissions.
``Sec. 723. Penalty for noncompliance.
``Sec. 724. Trading.
``Sec. 725. Banking and borrowing.
``Sec. 726. Strategic reserve.
``Sec. 727. Permits.
``Sec. 728. International emission allowances.
``Part D--Offsets
``Sec. 731. Offsets Integrity Advisory Board.
``Sec. 732. Establishment of offsets program.
``Sec. 733. Eligible project types.
``Sec. 734. Requirements for offset projects.
``Sec. 735. Approval of offset projects.
``Sec. 736. Verification of offset projects.
``Sec. 737. Issuance of offset credits.
``Sec. 738. Audits.
``Sec. 739. Program review and revision.
``Sec. 740. Early offset supply.
``Sec. 741. Environmental considerations.
``Sec. 742. Trading.
``Sec. 743. International offset credits.
``Part E--Supplemental Emissions Reductions From Reduced Deforestation
``Sec. 751. Definitions.
``Sec. 752. Findings.
``Sec. 753. Supplemental emissions reductions through reduced
deforestation.
``Sec. 754. Requirements for international deforestation
reduction program.
``Sec. 755. Reports and reviews.
``Sec. 756. Legal effect of part.
Sec. 312. Definitions.
``Sec. 700. Definitions.
Subtitle B--Disposition of Allowances
Sec. 321. Disposition of allowances for global warming pollution
reduction program.
``Part H--Disposition of Allowances
``Sec. 781. Allocation of allowances for supplemental
reductions.
``Sec. 782. Allocation of emission allowances.
``Sec. 783. Electricity consumers.
``Sec. 784. Natural gas consumers.
``Sec. 785. Home heating oil, propane, and kerosene consumers.
``Sec. 787. Allocations to refineries.
``Sec. 788. Supplemental agriculture and renewable energy
incentives programs.
``Sec. 789. Climate change consumer refunds.
``Sec. 790. Exchange for State-issued allowances.
``Sec. 791. Auction procedures.
``Sec. 792. Auctioning allowances for other entities.
``Sec. 793. Establishment of funds.
``Sec. 794. Oversight of allocations.
``Sec. 795. Exchange for early action offset credits.
Subtitle C--Additional Greenhouse Gas Standards
Sec. 331. Greenhouse gas standards.
``TITLE VIII--ADDITIONAL GREENHOUSE GAS STANDARDS
``Sec. 801. Definitions.
``Part A--Stationary Source Standards
``Sec. 811. Standards of performance.
``Part C--Exemptions From Other Programs
``Sec. 831. Criteria pollutants.
``Sec. 832. International air pollution.
``Sec. 833. Hazardous air pollutants.
``Sec. 834. New source review.
``Sec. 835. Title V permits.
Sec. 332. HFC Regulation.
``Sec. 619. Hydrofluorocarbons (HFCs).
Sec. 333. Black carbon.
``Part E--Black Carbon
``Sec. 851. Black carbon.
Sec. 334. States.
Sec. 335. State programs.
``Part F--Miscellaneous
``Sec. 861. State programs.
``Sec. 862. Grants for support of air pollution control
programs.
Sec. 336. Enforcement.
Sec. 337. Conforming amendments.
Sec. 338. Davis-Bacon compliance.
Sec. 339. National strategy for domestic biological carbon
sequestration.
Sec. 340. Reducing acid rain and mercury pollution.
Subtitle D--Carbon Market Assurance
Sec. 341. Carbon market assurance.
``Part IV--Carbon Market Assurance
``Sec. 401. Oversight and assurance of carbon markets.
``Sec. 402. Applicability of Part III provisions.
``Sec. 1041. Fraud and false statements in connection with
regulated allowances.
Sec. 342. Carbon derivative markets.
Subtitle E--Additional Market Assurance
Sec. 351. Regulation of certain transactions in derivatives involving
energy commodities.
Sec. 352. No effect on authority of the Federal Energy Regulatory
Commission.
Sec. 353. Inspector General of the Commodity Futures Trading
Commission.
Sec. 354. Settlement and clearing through registered derivatives
clearing organizations.
Sec. 355. Limitation on eligibility to purchase a credit default swap.
Sec. 356. Transaction fees.
Sec. 357. No effect on antitrust law or authority of the Federal Trade
Commission.
Sec. 358. Effect of derivatives regulatory reform legislation.
Sec. 359. Cease-and-desist authority.
Sec. 360. Presidential review of regulations.
TITLE IV--TRANSITIONING TO A CLEAN ENERGY ECONOMY
Subtitle A--Ensuring Real Reductions in Industrial Emissions
Sec. 401. Ensuring real reductions in industrial emissions.
``Part F--Ensuring Real Reductions in Industrial Emissions
``Sec. 761. Purposes.
``Sec. 762. Definitions.
``subpart 1--emission allowance rebate program
``Sec. 763. Eligible industrial sectors.
``Sec. 764. Distribution of emission allowance rebates.
``subpart 2--promoting international reductions in industrial emissions
``Sec. 765. International negotiations.
``Sec. 766. United States negotiating objectives with respect
to multilateral environmental negotiations.
``Sec. 767. Presidential reports and determinations.
``Sec. 768. International reserve allowance program.
``Sec. 769. Iron and steel sector.
Subtitle B--Green Jobs and Worker Transition
Part 1--Green Jobs
Sec. 421. Clean energy curriculum development grants.
Sec. 422. Increased funding for energy worker training program.
Sec. 423. Development of Information and Resources clearinghouse for
vocational education and job training in
renewable energy sectors.
Sec. 424. Monitoring program effectiveness.
Sec. 424A. Green construction careers demonstration project.
Part 2--Climate Change Worker Adjustment Assistance
Sec. 425. Petitions, eligibility requirements, and determinations.
Sec. 426. Program benefits.
Sec. 427. General provisions.
Subtitle C--Consumer Assistance
Sec. 431. Energy refund program.
``TITLE XXII--ENERGY REFUND PROGRAM
``Sec. 2201. Energy refund program.
Sec. 432. Modification of earned income credit amount for individuals
with no qualifying children.
Sec. 433. Protection of Social Security and Medicare trust funds.
Subtitle D--Exporting Clean Technology
Sec. 441. Findings and purposes.
Sec. 442. Definitions.
Sec. 443. Governance.
Sec. 444. Determination of eligible countries.
Sec. 445. Qualifying activities.
Sec. 446. Assistance.
Subtitle E--Adapting to Climate Change
Part 1--Domestic Adaptation
subpart a--national climate change adaptation program
Sec. 451. Global change research and data management.
Sec. 452. National Climate Service.
Sec. 453. State programs to build resilience to climate change impacts.
subpart b--public health and climate change
Sec. 461. Sense of Congress on public health and climate change.
Sec. 462. Relationship to other laws.
Sec. 463. National strategic action plan.
Sec. 464. Advisory board.
Sec. 465. Reports.
Sec. 466. Definitions.
Sec. 467. Climate Change Health Protection and Promotion Fund.
subpart c--natural resource adaptation
Sec. 471. Purposes.
Sec. 472. Natural resources climate change adaptation policy.
Sec. 473. Definitions.
Sec. 474. Council on Environmental Quality.
Sec. 475. Natural Resources Climate Change Adaptation Panel.
Sec. 476. Natural Resources Climate Change Adaptation Strategy.
Sec. 477. Natural resources adaptation science and information.
Sec. 478. Federal natural resource agency adaptation plans.
Sec. 479. State natural resources adaptation plans.
Sec. 480. Natural Resources Climate Change Adaptation Fund.
Sec. 481. National Wildlife Habitat and Corridors Information Program.
Sec. 482. Additional provisions regarding Indian tribes.
Part 2--International Climate Change Adaptation Program
Sec. 491. Findings and purposes.
Sec. 492. Definitions.
Sec. 493. International Climate Change Adaptation Program.
Sec. 494. Distribution of allowances.
Sec. 495. Bilateral assistance.
TITLE V--AGRICULTURAL AND FORESTRY RELATED OFFSETS
Subtitle A--Offset Credit Program From Domestic Agricultural and
Forestry Sources
Sec. 501. Definitions.
Sec. 502. Establishment of offset credit program from domestic
agricultural and forestry sources.
Sec. 503. List of eligible domestic agricultural and forestry offset
practice types.
Sec. 504. Requirements for domestic agricultural and forestry
practices.
Sec. 505. Project plan submission and approval.
Sec. 506. Verification of offset practices.
Sec. 507. Certification of offset credits.
Sec. 508. Ownership and transfer of offset credits.
Sec. 509. Program review and revision.
Sec. 510. Environmental considerations.
Sec. 511. Audits.
Subtitle B--USDA Greenhouse Gas Emission Reduction and Sequestration
Advisory Committee
Sec. 531. Establishment of USDA Greenhouse Gas Emission Reduction and
Sequestration Advisory Committee.
Subtitle C--Miscellaneous
Sec. 551. International indirect land use changes.
Sec. 552. Biomass-based diesel.
Sec. 553. Modification of definition of renewable biomass.
SEC. 2. DEFINITIONS.
For purposes of this Act:
(1) Administrator.--The term ``Administrator'' means the
Administrator of the Environmental Protection Agency.
(2) State.--The term ``State'' has the meaning given that
term in section 302 of the Clean Air Act.
SEC. 3. INTERNATIONAL PARTICIPATION.
The Administrator, in consultation with the Department of State and
the United States Trade Representative, shall annually prepare and
certify a report to the Congress regarding whether China and India have
adopted greenhouse gas emissions standards at least as strict as those
standards required under this Act. If the Administrator determines that
China and India have not adopted greenhouse gas emissions standards at
least as stringent as those set forth in this Act, the Administrator
shall notify each Member of Congress of his determination, and shall
release his determination to the media.
TITLE I--CLEAN ENERGY
Subtitle A--Combined Efficiency and Renewable Electricity Standard
SEC. 101. COMBINED EFFICIENCY AND RENEWABLE ELECTRICITY STANDARD.
(a) In General.--Title VI of the Public Utility Regulatory Policies
Act of 1978 (16 U.S.C. 2601 and following) is amended by adding at the
end the following:
``SEC. 610. COMBINED EFFICIENCY AND RENEWABLE ELECTRICITY STANDARD.
``(a) Definitions.--For purposes of this section:
``(1) CHP savings.--The term `CHP savings' means--
``(A) CHP system savings from a combined heat and
power system that commences operation after the date of
enactment of this section; and
``(B) the increase in CHP system savings from, at
any time after the date of the enactment of this
section, upgrading, replacing, expanding, or increasing
the utilization of a combined heat and power system
that commenced operation on or before the date of
enactment of this section.
``(2) CHP system savings.--The term `CHP system savings'
means the increment of electric output of a combined heat and
power system that is attributable to the higher efficiency of
the combined system (as compared to the efficiency of separate
production of the electric and thermal outputs).
``(3) Combined heat and power system.--The term `combined
heat and power system' means a system that uses the same energy
source both for the generation of electrical or mechanical
power and the production of steam or another form of useful
thermal energy, provided that--
``(A) the system meets such requirements relating
to efficiency and other operating characteristics as
the Commission may promulgate by regulation; and
``(B) the net sales of electricity by the facility
to customers not consuming the thermal output from that
facility will not exceed 50 percent of total annual
electric generation by the facility.
``(4) Customer facility savings.--The term `customer
facility savings' means a reduction in end-use electricity
consumption (including recycled energy savings) at a facility
of an end-use consumer of electricity served by a retail
electric supplier, as compared to--
``(A) in the case of a new facility, consumption at
a reference facility of average efficiency;
``(B) in the case of an existing facility,
consumption at such facility during a base period,
except as provided in subparagraphs (C) and (D);
``(C) in the case of new equipment that replaces
existing equipment with remaining useful life, the
projected consumption of the existing equipment for the
remaining useful life of such equipment, and
thereafter, consumption of new equipment of average
efficiency of the same equipment type; and
``(D) in the case of new equipment that replaces
existing equipment at the end of the useful life of the
existing equipment, consumption by new equipment of
average efficiency of the same equipment type.
``(5) Distributed renewable generation facility.--The term
`distributed renewable generation facility' means a facility
that--
``(A) generates renewable electricity;
``(B) primarily serves 1 or more electricity
consumers at or near the facility site; and
``(C) is no greater than--
``(i) 2 megawatts in capacity; or
``(ii) 4 megawatts in capacity, in the case
of a facility that is placed in service after
the date of enactment of this section and
generates electricity from a renewable energy
resource other than by means of combustion.
``(6) Electricity savings.--The term `electricity savings'
means reductions in electricity consumption, relative to
business-as-usual projections, achieved through measures
implemented after the date of enactment of this section,
limited to--
``(A) customer facility savings of electricity,
adjusted to reflect any associated increase in fuel
consumption at the facility;
``(B) reductions in distribution system losses of
electricity achieved by a retail electricity
distributor, as compared to losses attributable to new
or replacement distribution system equipment of average
efficiency;
``(C) CHP savings; and
``(D) fuel cell savings.
``(7) Central procurement state.--The term `central
procurement State' means a State that, as of January 1, 2009,
had adopted and implemented a legally enforceable mandate that,
in lieu of requiring utilities to submit credits or
certificates issued based on generation of electricity from (or
to purchase or generate electricity from) resources defined by
the State as renewable, requires retail electric suppliers to
collect payments from electricity ratepayers within the State
that are used for central procurement, by a State agency or a
public benefit corporation established pursuant to State law,
of credits or certificates issued based on generation of
electricity from resources defined by the State as renewable.
``(8) Federal renewable electricity credit.--The term
`Federal renewable electricity credit' means a credit,
representing one megawatt hour of renewable electricity, issued
pursuant to subsection (e).
``(9) Fuel cell.--The term `fuel cell' means a device that
directly converts the chemical energy of a fuel and an oxidant
into electricity by electrochemical processes occurring at
separate electrodes in the device.
``(10) Fuel cell savings.--The term `fuel cell savings'
means the electricity saved by a fuel cell that is installed
after the date of enactment of this section, or by upgrading a
fuel cell that commenced operation on or before the date of
enactment of this section, as a result of the greater
efficiency with which the fuel cell transforms fuel into
electricity as compared with sources of electricity delivered
through the grid, provided that--
``(A) the fuel cell meets such requirements
relating to efficiency and other operating
characteristics as the Commission may promulgate by
regulation; and
``(B) the net sales of electricity from the fuel
cell to customers not consuming the thermal output from
the fuel cell, if any, do not exceed 50 percent of the
total annual electricity generation by the fuel cell.
``(11) Other qualifying energy resource.--The term `other
qualifying energy resource' means any of the following:
``(A) Landfill gas.
``(B) Wastewater treatment gas.
``(C) Coal mine methane used to generate
electricity at or near the mine mouth.
``(D) Qualified waste-to-energy.
``(12) Qualified hydropower.--The term `qualified
hydropower' means--
``(A) energy produced from increased efficiency
achieved, or additions of capacity made, on or after
January 1, 1988, at a hydroelectric facility that was
placed in service before that date and does not include
additional energy generated as a result of operational
changes not directly associated with efficiency
improvements or capacity additions; or
``(B) energy produced from generating capacity
added to a dam on or after January 1, 1988, provided
that the Commission certifies that--
``(i) the dam was placed in service before
the date of the enactment of this section and
was operated for flood control, navigation, or
water supply purposes and was not producing
hydroelectric power prior to the addition of
such capacity;
``(ii) the hydroelectric project installed
on the dam is licensed (or is exempt from
licensing) by the Commission and is in
compliance with the terms and conditions of the
license or exemption, and with other applicable
legal requirements for the protection of
environmental quality, including applicable
fish passage requirements; and
``(iii) the hydroelectric project installed
on the dam is operated so that the water
surface elevation at any given location and
time that would have occurred in the absence of
the hydroelectric project is maintained,
subject to any license or exemption
requirements that require changes in water
surface elevation for the purpose of improving
the environmental quality of the affected
waterway.
``(13) Qualified waste-to-energy.--The term `qualified
waste-to-energy' means energy from the combustion of municipal
solid waste or construction, demolition, or disaster debris, or
from the gasification or pyrolization of such waste or debris
and the combustion of the resulting gas at the same facility,
provided that--
``(A) such term shall include only the energy
derived from the non-fossil biogenic portion of such
waste or debris;
``(B) the Commission determines, with the
concurrence of the Administrator of the Environmental
Protection Agency, that the total lifecycle greenhouse
gas emissions attributable to the generation of
electricity from such waste or debris are lower than
those attributable to the likely alternative method of
disposing of such waste or debris; and
``(C) the owner or operator of the facility
generating electricity from such energy provides to the
Commission, on an annual basis--
``(i) a certification that the facility is
in compliance with all applicable State,
tribal, and Federal environmental permits;
``(ii) in the case of a facility that
commenced operation before the date of
enactment of this section, a certification that
the facility meets emissions standards
promulgated under section 112 or 129 of the
Clean Air Act (42 U.S.C. 7412 or 7429) that
apply as of the date of enactment of this
section to new facilities within the relevant
source category; and
``(iii) in the case of the combustion,
pyrolization, or gasification of municipal
solid waste, a certification that each local
government unit from which such waste
originates operates, participates in the
operation of, contracts for, or otherwise
provides for, recycling services for its
residents.
``(14) Recycled energy savings.--The term `recycled energy
savings' means a reduction in electricity consumption that
results from a modification of an industrial or commercial
system that commenced operation before the date of enactment of
this section, in order to recapture electrical, mechanical, or
thermal energy that would otherwise be wasted.
``(15) Renewable biomass.--The term `renewable biomass'
means any of the following:
``(A) Materials, pre-commercial thinnings, or
removed invasive species from National Forest System
land and public lands (as defined in section 103 of the
Federal Land Policy and Management Act of 1976 (43
U.S.C. 1702)), including those that are byproducts of
preventive treatments (such as trees, wood, brush,
thinnings, chips, and slash), that are removed as part
of a federally recognized timber sale, or that are
removed to reduce hazardous fuels, to reduce or contain
disease or insect infestation, or to restore ecosystem
health, and that are--
``(i) not from components of the National
Wilderness Preservation System, Wilderness
Study Areas, Inventoried Roadless Areas, old
growth stands, late-successional stands (except
for dead, severely damaged, or badly infested
trees), components of the National Landscape
Conservation System, National Monuments,
National Conservation Areas, Designated
Primitive Areas, or Wild and Scenic Rivers
corridors;
``(ii) harvested in environmentally
sustainable quantities, as determined by the
appropriate Federal land manager; and
``(iii) harvested in accordance with
Federal and State law, and applicable land
management plans.
``(B) Any organic matter that is available on a
renewable or recurring basis from non-Federal land or
land belonging to an Indian or Indian tribe that is
held in trust by the United States or subject to a
restriction against alienation imposed by the United
States, including--
``(i) renewable plant material, including--
``(I) feed grains;
``(II) other agricultural
commodities;
``(III) other plants and trees; and
``(IV) algae; and
``(ii) waste material, including--
``(I) crop residue;
``(II) other vegetative waste
material (including wood waste and wood
residues);
``(III) animal waste and byproducts
(including fats, oils, greases, and
manure);
``(IV) construction waste; and
``(V) food waste and yard waste.
``(C) Residues and byproducts from wood, pulp, or
paper products facilities.
``(16) Renewable electricity.--The term `renewable
electricity' means electricity generated (including by means of
a fuel cell) from a renewable energy resource or other
qualifying energy resources.
``(17) Renewable energy resource.--The term `renewable
energy resource' means each of the following:
``(A) Wind energy.
``(B) Solar energy.
``(C) Geothermal energy.
``(D) Renewable biomass.
``(E) Biogas derived exclusively from renewable
biomass.
``(F) Biofuels derived exclusively from renewable
biomass.
``(G) Qualified hydropower.
``(H) Marine and hydrokinetic renewable energy, as
that term is defined in section 632 of the Energy
Independence and Security Act of 2007 (42 U.S.C.
17211).
``(18) Retail electric supplier.--
``(A) In general.--The term `retail electric
supplier' means, for any given year, an electric
utility that sold not less than 4,000,000 megawatt
hours of electric energy to electric consumers for
purposes other than resale during the preceding
calendar year.
``(B) Inclusions and limitations.--For purposes of
determining whether an electric utility qualifies as a
retail electric supplier under subparagraph (A)--
``(i) the sales of any affiliate of an
electric utility to electric consumers, other
than sales to the affiliate's lessees or
tenants, for purposes other than resale shall
be considered to be sales of such electric
utility; and
``(ii) sales by any electric utility to an
affiliate, lessee, or tenant of such electric
utility shall not be treated as sales to
electric consumers.
``(C) Affiliate.--For purposes of this paragraph,
the term `affiliate' when used in relation to a person,
means another person that directly or indirectly owns
or controls, is owned or controlled by, or is under
common ownership or control with, such person, as
determined under regulations promulgated by the
Commission.
``(19) Retail electric supplier's base amount.--The term
`retail electric supplier's base amount' means the total amount
of electric energy sold by the retail electric supplier,
expressed in megawatt hours, to electric customers for purposes
other than resale during the relevant calendar year,
excluding--
``(A) electricity generated by a hydroelectric
facility that is not qualified hydropower;
``(B) electricity generated by a nuclear generating
unit placed in service after the date of enactment of
this section; and
``(C) the proportion of electricity generated by a
fossil-fueled generating unit that is equal to the
proportion of greenhouse gases produced by such unit
that are captured and geologically sequestered.
``(20) Retire and retirement.--The terms `retire' and
`retirement' with respect to a Federal renewable electricity
credit, means to disqualify such credit for any subsequent use
under this section, regardless of whether the use is a sale,
transfer, exchange, or submission in satisfaction of a
compliance obligation.
``(21) Third-party efficiency provider.--The term `third-
party efficiency provider' means any retailer, building owner,
energy service company, financial institution or other
commercial, industrial or nonprofit entity that is capable of
providing electricity savings in accordance with the
requirements of this section.
``(22) Total annual electricity savings.--The term `total
annual electricity savings' means electricity savings during a
specified calendar year from measures implemented since the
date of the enactment of this section, taking into account
verified measure lifetimes or verified annual savings attrition
rates, as determined in accordance with such regulations as the
Commission may promulgate and measured in megawatt hours.
``(b) Annual Compliance Obligation.--
``(1) In general.--For each of calendar years 2012 through
2039, not later than March 31 of the following calendar year,
each retail electric supplier shall submit to the Commission an
amount of Federal renewable electricity credits and
demonstrated total annual electricity savings that, in the
aggregate, is equal to such retail electric supplier's annual
combined target as set forth in subsection (d), except as
otherwise provided in subsection (h).
``(2) Demonstration of savings.--For purposes of this
subsection, submission of demonstrated total annual electricity
savings means submission of a report that demonstrates, in
accordance with the requirements of subsection (f), the total
annual electricity savings achieved by the retail electric
supplier within the relevant compliance year.
``(3) Renewable electricity credits portion.--Except as
provided in paragraph (4), each retail electric supplier must
submit Federal renewable electricity credits equal to at least
three quarters of the retail electric supplier's annual
combined target.
``(4) State petition.--
``(A) In general.--Upon written request from the
Governor of any State (including, for purposes of this
paragraph, the Mayor of the District of Columbia), the
Commission shall increase, to not more than two fifths,
the proportion of the annual combined targets of retail
electric suppliers located within such State that may
be met through submission of demonstrated total annual
electricity savings, provided that such increase shall
be effective only with regard to the portion of a
retail electric supplier's annual combined target that
is attributable to electricity sales within such State.
``(B) Contents.--A Governor's request under this
paragraph shall include an explanation of the
Governor's rationale for determining, after
consultation with the relevant State regulatory
authority and other retail electricity ratemaking
authorities within the State, to make such request. The
request shall specify the maximum proportion of annual
combined targets (not more than two fifths) that can be
met through demonstrated total annual electricity
savings, and the period for which such proportion shall
be effective.
``(C) Revision.--The Governor of any State may,
after consultation with the relevant State regulatory
authority and other retail electricity ratemaking
authorities within the State, submit a written request
for revocation or revision of a previous request
submitted under this paragraph. The Commission shall
grant such request, provided that--
``(i) any revocation or revision shall not
apply to the combined annual target for any
year that is any earlier than 2 calendar years
after the calendar year in which such request
is submitted, so as to provide retail electric
suppliers with adequate notice of such change;
and
``(ii) any revision shall meet the
requirements of subparagraph (A).
``(c) Establishment of Program.--Not later than 1 year after the
date of enactment of this section, the Commission shall promulgate
regulations to implement and enforce the requirements of this section.
In promulgating such regulations, the Commission shall, to the extent
practicable--
``(1) preserve the integrity, and incorporate best
practices, of existing State and tribal renewable electricity
and energy efficiency programs;
``(2) rely upon existing and emerging State, tribal, or
regional tracking systems that issue and track non-Federal
renewable electricity credits; and
``(3) cooperate with the States and Indian tribes to
facilitate coordination between State, tribal, and Federal
renewable electricity and energy efficiency programs and to
minimize administrative burdens and costs to retail electric
suppliers.
``(d) Annual Compliance Requirement.--
``(1) Annual combined targets.--For each of calendar years
2012 through 2039, a retail electric supplier's annual combined
target shall be the product of--
``(A) the required annual percentage for such year,
as set forth in paragraph (2); and
``(B) the retail electric supplier's base amount
for such year.
``(2) Required annual percentage.--For each of calendar
years 2012 through 2039, the required annual percentage shall
be as follows:
``Calendar year Required annual percentage
2012................................... 6.0
2013................................... 6.0
2014................................... 9.5
2015................................... 9.5
2016................................... 13.0
2017................................... 13.0
2018................................... 16.5
2019................................... 16.5
2020................................... 20.0
2021 through 2039...................... 20.0
``(e) Federal Renewable Electricity Credits.--
``(1) In general.--The regulations promulgated under this
section shall include provisions governing the issuance,
tracking, and verification of Federal renewable electricity
credits. Except as provided in paragraphs (2), (3), and (4) of
this subsection, the Commission shall issue to each generator
of renewable electricity, 1 Federal renewable electricity
credit for each megawatt hour of renewable electricity
generated by such generator after December 31, 2011. The
Commission shall assign a unique serial number to each Federal
renewable electricity credit.
``(2) Generation from certain state renewable electricity
programs.--(A) Except as provided in subparagraph (B), where
renewable electricity is generated with the support of payments
from a retail electric supplier pursuant to a State renewable
electricity program (whether through State alternative
compliance payments or through payments to a State renewable
electricity procurement fund or entity), the Commission shall
issue Federal renewable electricity credits to such retail
electric supplier for the proportion of the relevant renewable
electricity generation that is attributable to the retail
electric supplier's payments, as determined pursuant to
regulations issued by the Commission. For any remaining portion
of the relevant renewable electricity generation, the
Commission shall issue Federal renewable electricity credits to
the generator, as provided in paragraph (1), except that in no
event shall more than 1 Federal renewable electricity credit be
issued for the same megawatt hour of electricity. In
determining how Federal renewable electricity credits will be
apportioned among retail electric suppliers and generators in
such circumstances, the Commission shall consider information
and guidance furnished by the relevant State or States.
``(B) In the case of a central procurement State that
pursuant to subsection (g) has assumed responsibility for
compliance with the requirements of subsection (b), the
Commission shall issue directly to the State Federal renewable
electricity credits for any renewable electricity for which the
State, pursuant to a mandate described in subsection (a)(7),
has centrally procured credits or certificates issued based on
generation of such renewable electricity.
``(3) Certain power sales contracts.--Except as otherwise
provided in paragraph (2), when a generator has sold renewable
electricity to a retail electric supplier under a contract for
power from a facility placed in service before the date of
enactment of this section, and the contract does not provide
for the determination of ownership of the Federal renewable
electricity credits associated with such generation, the
Commission shall issue such Federal renewable electricity
credits to the retail electric supplier for the duration of the
contract.
``(4) Credit multiplier for distributed renewable
generation.--
``(A) In general.--Except as provided in
subparagraph (B), the Commission shall issue 3 Federal
renewable electricity credits for each megawatt hour of
renewable electricity generated by a distributed
renewable generation facility.
``(B) Adjustment.--Except as provided in
subparagraph (C), not later than January 1, 2014, and
not less frequently than every 4 years thereafter, the
Commission shall review the effect of this paragraph
and shall, as necessary, reduce the number of Federal
renewable electricity credits per megawatt hour issued
under this paragraph for any given energy source or
technology, but not below 1, to ensure that such number
is no higher than the Commission determines is
necessary to make distributed renewable generation
facilities using such source or technology cost
competitive with other sources of renewable electricity
generation.
``(C) Facilities placed in service after
enactment.--For any distributed renewable generation
facility placed in service after the date of enactment
of this section, subparagraph (B) shall not apply for
the first 10 years after the date on which the facility
is placed in service. For each year during such 10-year
period, the Commission shall issue to the facility the
same number of Federal renewable electricity credits
per megawatt hour as are issued to that facility in the
year in which such facility is placed in service. After
such 10-year period, the Commission shall issue Federal
renewable electricity credits to the facility in
accordance with the current multiplier as determined
pursuant to subparagraph (B).
``(5) Credits based on qualified hydropower.--For purposes
of this subsection, the number of Federal renewable electricity
credits issued for qualified hydropower shall be calculated--
``(A) based solely on the increase in average
annual generation directly resulting from the
efficiency improvements or capacity additions described
in subsection (a)(13)(A); and
``(B) using the same water flow information used to
determine a historic average annual generation baseline
for the hydroelectric facility, as certified by the
Commission.
``(6) Generation from qualified waste-to-energy.--In the
case of electricity generated from the combustion of any
municipal solid waste or construction, demolition, or disaster
debris that is included in the definition of renewable biomass,
or from the gasification or pyrolization of such waste or
debris and the combustion of the resulting gas at the same
facility, the Commission shall issue Federal renewable
electricity credits only for electricity generated from
qualified waste-to-energy.
``(7) Generation from mixed renewable and nonrenewable
resources.--If electricity is generated using both a renewable
energy resource or other qualifying energy resource and an
energy source that is not a renewable energy resource or other
qualifying energy resource (as, for example, in the case of co-
firing of renewable biomass and fossil fuel), the Commission
shall issue Federal renewable electricity credits based on the
proportion of the electricity that is attributable to the
renewable energy resource or other qualifying energy resource.
``(8) Prohibition against double-counting.--Except as
provided in paragraph (4) of this subsection, the Commission
shall ensure that no more than 1 Federal renewable electricity
credit will be issued for any megawatt hour of renewable
electricity and that no Federal renewable electricity credit
will be used more than once for compliance with this section.
``(9) Trading.--The lawful holder of a Federal renewable
electricity credit may sell, exchange, transfer, submit for
compliance in accordance with subsection (b), or submit such
credit for retirement by the Commission.
``(10) Banking.--A Federal renewable electricity credit may
be submitted in satisfaction of the compliance obligation set
forth in subsection (b) for the compliance year in which the
credit was issued or for any of the 3 immediately subsequent
compliance years. The Commission shall retire any Federal
renewable electricity credit that has not been retired by April
2 of the calendar year that is 3 years after the calendar year
in which the credit was issued.
``(11) Retirement.--The Commission shall retire a Federal
renewable electricity credit immediately upon submission by the
lawful holder of such credit, whether in satisfaction of a
compliance obligation under subsection (b) or on some other
basis.
``(f) Electricity Savings.--
``(1) Standards for measurement of savings.--As part of the
regulations promulgated under this section, the Commission
shall prescribe standards and protocols for defining and
measuring electricity savings and total annual electricity
savings that can be counted towards the compliance obligation
set forth in subsection (b). Such protocols and standards
shall, at minimum--
``(A) specify the types of energy efficiency and
energy conservation measures that can be counted;
``(B) require that energy consumption estimates for
customer facilities or portions of facilities in the
applicable base and current years be adjusted, as
appropriate, to account for changes in weather, level
of production, and building area;
``(C) account for the useful life of measures;
``(D) include deemed savings values for specific,
commonly used measures;
``(E) allow for savings from a program to be
estimated based on extrapolation from a representative
sample of participating customers;
``(F) include procedures for counting CHP savings,
recycled energy savings, and fuel cell savings;
``(G) include procedures for documenting measurable
and verifiable electricity savings achieved as a result
of market transformation efforts;
``(H) include procedures for counting electricity
savings achieved by solar water heating and solar light
pipe technology that has the capability to provide
measurable data on the amount of megawatt-hours
displaced;
``(I) avoid double-counting of savings used for
compliance with this section, including savings that
are transferred pursuant to paragraph (3);
``(J) ensure that, except as provided in
subparagraph (L), the retail electric supplier claiming
the savings played a significant role in achieving the
savings (including through the activities of a
designated agent of the supplier or through the
purchase of transferred savings);
``(K) include savings from programs administered by
a retail electric supplier (or a retail electricity
distributor that is not a retail electric supplier)
that are funded by State, Federal, or other sources;
``(L) in any State in which the State regulatory
authority has designated 1 or more entities to
administer electric ratepayer-funded efficiency
programs approved by such State regulatory authority,
provide that electricity savings achieved through such
programs shall be distributed equitably among retail
electric suppliers in accordance with the direction of
the relevant State regulatory authority; and
``(M) exclude savings achieved as a result of
compliance with mandatory appliance and equipment
efficiency standards or building codes.
``(2) Standards for third-party verification of savings.--
The regulations promulgated under this section shall establish
procedures and standards requiring third-party verification of
all reported electricity savings, including requirements for
accreditation of third-party verifiers to ensure that such
verifiers are professionally qualified and have no conflicts of
interest.
``(3) Transfers of savings.--
``(A) Bilateral contracts for savings transfers.--
Subject to the limitations of this paragraph, a retail
electric supplier may use electricity savings
transferred, pursuant to a bilateral contract, from
another retail electric supplier, an owner of an
electric distribution facility that is not a retail
electric supplier, a State, or a third-party efficiency
provider to meet the applicable compliance obligation
under subsection (b).
``(B) Requirements.--Electricity savings
transferred and used for compliance pursuant to this
paragraph shall be--
``(i) measured and verified in accordance
with the procedures specified under this
subsection;
``(ii) reported in accordance with
paragraph (4) of this subsection; and
``(iii) achieved within the same State as
is served by the retail electric supplier.
``(C) Regulatory approval.--Nothing in this
paragraph shall limit or affect the authority of a
State regulatory authority to require a retail electric
supplier that is regulated by such authority to obtain
such authority's authorization or approval of a
contract for transfer of savings under this paragraph.
``(4) Reporting savings.--
``(A) Requirements.--The regulations promulgated
under this section shall establish requirements
governing the submission of reports to demonstrate, in
accordance with the protocols and standards for
measurement and third-party verification established
under this subsection, the total annual electricity
savings achieved by a retail electric supplier within
the relevant year.
``(B) Review and approval.--The Commission shall
review each report submitted to the Commission by a
retail electric supplier and shall exclude any
electricity savings that have not been adequately
demonstrated in accordance with the requirements of
this subsection.
``(5) State administration.--
``(A) Delegation of authority.--Upon receipt of an
application from the Governor of a State (including,
for purposes of this subsection, the Mayor of the
District of Columbia), the Commission may delegate to
the State the authority to review and verify reported
electricity savings for purposes of determining
demonstrated total annual electricity savings that may
be counted towards a retail electric supplier's
compliance obligation under subsection (b). The
Commission shall make a substantive determination
approving or disapproving a State application under
this subparagraph, after notice and comment, within 180
days of receipt of a complete application.
``(B) Alternative measurement and verification
procedures and standards.--As part of an application
submitted under subparagraph (A), a State may request
to use alternative measurement and verification
procedures and standards to those specified in
paragraphs (1) and (2), provided the State demonstrates
that such alternative procedures and standards provide
a level of accuracy of measurement and verification at
least equivalent to the Federal procedures and
standards promulgated under paragraphs (1) and (2).
``(C) Review of state implementation.--The
Commission shall, not less frequently than once every 4
years, review each State's implementation of delegated
authority under this paragraph to ensure conformance
with the requirements of this section. The Commission
may, at any time, revoke the delegation of authority
under this section upon a finding that the State is not
implementing its delegated responsibilities in
conformity with this paragraph. As a condition of
maintaining its delegated authority under this
paragraph, the Commission may require a State to submit
a revised application under subparagraph (A) if the
Commission has--
``(i) promulgated new or substantially
revised measurement and verification procedures
and standards under this subsection; or
``(ii) otherwise substantially revised the
program established under this section.
``(g) Alternative Compliance Payments.--
``(1) In general.--A retail electric supplier, or a central
procurement State that, pursuant to subsection (g), has assumed
responsibility for compliance with the requirements of
subsection (b), may satisfy the requirements of subsection (b)
in whole or in part by submitting in accordance with this
subsection, in lieu of each Federal renewable electricity
credit or megawatt hour of demonstrated total annual
electricity savings that would otherwise be due, a payment
equal to $25, adjusted for inflation on January 1 of each year
following calendar year 2009, in accordance with such
regulations as the Commission may promulgate.
``(2) Payment to state funds.--Except as otherwise provided
in this paragraph and paragraph (4), payments made under this
subsection shall be made directly to the State or States in
which the retail electric supplier is located, in proportion to
the portion of the retail electric supplier's base amount that
is sold within each relevant State, provided that such payments
are deposited directly into a fund in the State treasury
established for this purpose and that the State uses such funds
in accordance with paragraphs (3) and (5) and with paragraph
(4), where applicable. If the Commission determines at any time
that a State is in substantial noncompliance with paragraph (3)
or (5), or with paragraph (4), where applicable, the Commission
shall direct that any future alternative compliance payments
that would otherwise be paid to such State under this
subsection shall instead be paid to the Commission and
deposited in the United States Treasury.
``(3) State use of funds.--As a condition of continued
receipt of alternative compliance payments pursuant to this
subsection, a State shall use such payments exclusively for the
purposes of--
``(A) deploying technologies that generate
electricity from renewable energy resources; or
``(B) implementing cost-effective energy efficiency
programs to achieve electricity savings.
``(4) Central procurement states.--
``(A) In general.--A central procurement State
that, pursuant to subsection (g), has assumed
responsibility for compliance with the requirements of
subsection (b) shall deposit any alternative compliance
payments under this subsection in a unique fund in the
State treasury created and used solely for this
purpose.
``(B) Requirements.--As a precondition of making
alternative compliance payments under this subsection,
a central procurement State shall certify to the
Commission, in accordance with such requirements as the
Commission may prescribe, that--
``(i) making such payments is the lowest
cost alternative to meet the requirements of
subsection (b); and
``(ii) moneys used by the State to make
such payments are in addition to any spending
that the State, and any separate entity charged
with administering the State central
procurement requirement identified under
subsection (a)(7), otherwise collectively would
direct to the purposes identified in paragraph
(3).
``(C) Uses.--A central procurement State that makes
alternative compliance payments under this subsection
shall certify to the Commission that, in using such
payments in accordance with paragraph (3), it has, to
the extent practicable, maximized the level of
deployment of renewable electricity generation
(measured in megawatt hours) and electricity savings
per dollar that are achieved through such expenditures.
``(5) Reporting.--As a condition of continued receipt of
alternative compliance payments pursuant to this subsection, a
State shall, within 12 months of receipt of any such payments
and at 12-month intervals thereafter until such payments are
expended, provide a report to the Commission, in accordance
with such regulations as the Commission may prescribe, giving a
full accounting of the use of such payments, including a
detailed description of the activities funded thereby and
demonstrating compliance with the requirements of this
subsection.
``(g) Central Procurement States.--
``(1) In general.--A central procurement State may, upon
submission of a written request by the Governor of such State
to the Commission, assume responsibility for compliance with
the requirements of subsection (b) on behalf of retail electric
suppliers located in such State, exclusively with regard to the
portion of such retail electric suppliers' base amount that is
sold within the State.
``(2) Demonstration of electricity savings.--If a central
procurement State opts to meet any part of the requirements of
subsection (b) based on the achievement of demonstrated total
annual electricity savings, regardless of whether such State
has received delegated authority pursuant to subsection (f)(5),
such State shall submit such demonstrated total annual
electricity savings to the Commission through an annual report
in accordance with requirements prescribed by the Commission by
regulation, which shall be of equivalent stringency to those
applicable to retail electric suppliers under subsection (f).
``(3) Noncompliance.--If a central procurement State that
pursuant to this subsection has assumed responsibility for
compliance with the requirements of subsection (b), fails to
satisfy the requirements of subsection (b) or (h) for any year,
the State's assumption of responsibility under this subsection
shall be discontinued immediately, and retail electric
suppliers located in such State henceforth shall be directly
subject to the requirements of this section.
``(h) Information Collection.--The Commission may require any
retail electric supplier, renewable electricity generator, or such
other entities as the Commission deems appropriate, to provide any
information the Commission determines appropriate to carry out this
section. Failure to submit such information or submission of false or
misleading information under this subsection shall be a violation of
this section.
``(i) Enforcement and Judicial Review.--
``(1) Failure to submit credits or demonstrate savings.--If
any person, other than any central procurement State that
pursuant to subsection (g) has assumed responsibility for
compliance with the requirements of subsection (b), fails to
comply with the requirements of subsection (b) or (h), such
person shall be liable to pay to the Commission a civil penalty
equal to the product of--
``(A) double the alternative compliance payment
calculated under subsection (h)(1), and
``(B) the aggregate quantity of Federal renewable
electricity credits, total annual electricity savings,
or equivalent alternative compliance payments that the
person failed to submit in violation of the
requirements of subsections (b) and (h).
``(2) Enforcement.--The Commission shall assess a civil
penalty under paragraph (1) in accordance with the procedures
described in section 31(d) of the Federal Power Act (16 U.S.C.
823b(d)).
``(3) Violation of requirement of regulations or orders.--
Any person, other than any central procurement State that
pursuant to subsection (g) has assumed responsibility for
compliance with the requirements of subsection (b), who
violates, or fails or refuses to comply with, any requirement
of a regulation promulgated or order issued under this section
shall be subject to a civil penalty under section 316A(b) of
the Federal Power Act (16 U.S.C. 825o-1). Such penalty shall be
assessed by the Commission in the same manner as in the case of
a violation referred to in section 316A(b) of such Act.
``(j) Judicial Review.--Any person aggrieved by a final action
taken by the Commission under this section, other than the assessment
of a civil penalty under subsection (j), may use the procedures for
review described in section 313 of the Federal Power Act (16 U.S.C.
825l). For purposes of this paragraph, references to an order in
section 313 of such Act shall be deemed to refer also to all other
final actions of the Commission under this section other than the
assessment of a civil penalty under subsection (i).
``(k) Savings Provisions.--Nothing in this section shall--
``(1) diminish or qualify any authority of a State, a
political subdivision of a State, or an Indian tribe to--
``(A) adopt or enforce any law or regulation
respecting renewable electricity or energy efficiency,
including any law or regulation establishing
requirements more stringent than those established by
this section, provided that no such law or regulation
may relieve any person of any requirement otherwise
applicable under this section; or
``(B) regulate the acquisition and disposition of
Federal renewable electricity credits by retail
electric suppliers within the jurisdiction of such
State, political subdivision, or Indian tribe,
including the authority to require such retail electric
supplier to acquire and submit to the Secretary for
retirement Federal renewable electricity credits in
excess of those submitted under this section; or
``(2) affect the application of, or the responsibility for
compliance with, any other provision of law or regulation,
including environmental and licensing requirements.
``(l) Sunset.--This section expires on December 31, 2040.''.
(b) Conforming Amendment.--The table of contents set forth in
section 1(b) of the Public Utility Regulatory Policies Act of 1978 (16
U.S.C. 2601 and following) is amended by inserting after the item
relating to section 609 the following:
``Sec. 610. Combined efficiency and renewable electricity standard.''.
SEC. 102. CLARIFYING STATE AUTHORITY TO ADOPT RENEWABLE ENERGY
INCENTIVES.
Section 210 of the Public Utility Regulatory Policies Act of 1978
is amended by adding at the end thereof:
``(o) Clarification of State Authority to Adopt Renewable Energy
Incentives.--Notwithstanding any other provision of this Act or the
Federal Power Act, a State legislature or regulatory authority may set
the rates for a sale of electric energy by a facility generating
electric energy from renewable energy sources pursuant to a State-
approved production incentive program under which the facility
voluntarily sells electric energy. For purposes of this subsection,
`State-approved production incentive program' means a requirement
imposed pursuant to State law, or by a State regulatory authority
acting within its authority under State law, that an electric utility
purchase renewable energy (as defined in section 609 of this Act) at a
specified rate.''.
SEC. 103. FEDERAL RENEWABLE ENERGY PURCHASES.
(a) Requirement.--For each of calendar years 2012 through 2039, the
President shall ensure that, of the total amount of electricity Federal
agencies consume in the United States during each calendar year, the
following percentage shall be renewable electricity:
Calendar year Required annual percentage
2012................................... 6.0
2013................................... 6.0
2014................................... 9.5
2015................................... 9.5
2016................................... 13.0
2017................................... 13.0
2018................................... 16.5
2019................................... 16.5
2020................................... 20.0
2021 through 2039...................... 20.0
(b) Definitions.--For purposes of this section:
(1) Renewable electricity.--The term ``renewable
electricity'' shall have the meaning given in section 610 of
the Public Utility Regulatory Policies Act of 1978 (16 U.S.C.
2601 and following).
(2) Renewable energy resource.--The term ``renewable energy
resource'' shall have the meaning given in section 610 of the
Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 2601
and following).
(c) Modification of Requirement.--If the President determines that
the Federal Government cannot feasibly meet the requirement established
in subsection (a) in a specific calendar year, the President may, by
written order, reduce such requirement for such calendar year to a
percentage the President determines the Federal Government can feasibly
meet.
(d) Reports.--Not later than April 1, 2013, and each year
thereafter, the Secretary of Energy shall provide a report to Congress
on the percentage of each Federal agency's electricity consumption in
the United States that was renewable electricity in the previous
calendar year.
(e) Contracts for Renewable Energy.--(1) Notwithstanding section
501(b)(1)(B) of title 40, United States Code, a contract for the
acquisition of electricity generated from a renewable energy resource
for the Federal Government may be made for a period of not more than 20
years.
(2) Not later than 90 days after the date of enactment of this
subsection, the Secretary of Energy, through the Federal Energy
Management Program, shall publish a standardized renewable energy
purchase agreement, setting forth commercial terms and conditions, that
Federal agencies may use to acquire electricity generated from a
renewable energy resource.
(3) The Secretary of Energy shall provide technical assistance to
assist Federal agencies in implementing this subsection.
Subtitle B--Carbon Capture and Sequestration
SEC. 111. NATIONAL STRATEGY.
(a) In General.--Not later than 1 year after the date of enactment
of this Act, the Administrator, in consultation with the Secretary of
Energy, the Secretary of the Interior, and the heads of such other
relevant Federal agencies as the President may designate, shall submit
to Congress a report setting forth a unified and comprehensive strategy
to address the key legal, regulatory and other barriers to the
commercial-scale deployment of carbon capture and sequestration.
(b) Barriers.--The report under this section shall--
(1) identify those regulatory, legal, and other gaps and
barriers that could be addressed by a Federal agency using
existing statutory authority, those, if any, that require
Federal legislation, and those that would be best addressed at
the State, tribal, or regional level;
(2) identify regulatory implementation challenges,
including those related to approval of State and tribal
programs and delegation of authority for permitting; and
(3) recommend rulemakings, Federal legislation, or other
actions that should be taken to further evaluate and address
such barriers.
SEC. 112. REGULATIONS FOR GEOLOGIC SEQUESTRATION SITES.
(a) Coordinated Certification and Permitting Process.--Title VIII
of the Clean Air Act, as added by section 331 of this Act, is amended
by adding after section 812 (as added by section 116 of this Act) the
following:
``SEC. 813. GEOLOGIC SEQUESTRATION SITES.
``(a) Coordinated Process.--The Administrator shall establish a
coordinated approach to certifying and permitting geologic
sequestration, taking into consideration all relevant statutory
authorities. In establishing such approach, the Administrator shall--
``(1) take into account, and reduce redundancy with, the
requirements of section 1421 of the Safe Drinking Water Act (42
U.S.C. 300h), as amended by section 112(b) of the American
Clean Energy and Security Act of 2009, including the rulemaking
for geologic sequestration wells described at 73 Fed. Reg.
43491-541 (July 25, 2008); and
``(2) to the extent practicable, reduce the burden on
certified entities and implementing authorities.
``(b) Regulations.--Not later than 2 years after the date of
enactment of this title, the Administrator shall promulgate regulations
to protect human health and the environment by minimizing the risk of
escape to the atmosphere of carbon dioxide injected for purposes of
geologic sequestration.
``(c) Requirements.--The regulations under subsection (b) shall
include--
``(1) a process to obtain certification for geologic
sequestration under this section; and
``(2) requirements for--
``(A) monitoring, record keeping, and reporting for
emissions associated with injection into, and escape
from, geologic sequestration sites, taking into account
any requirements or protocols developed under section
713;
``(B) public participation in the certification
process that maximizes transparency;
``(C) the sharing of data between States, Indian
tribes, and the Environmental Protection Agency; and
``(D) other elements or safeguards necessary to
achieve the purpose set forth in subsection (b).
``(d) Report.--Not later than 2 years after the promulgation of
regulations under subsection (b), and at 3-year intervals thereafter,
the Administrator shall deliver to the Committee on Energy and Commerce
of the House of Representatives and the Committee on Environment and
Public Works of the Senate a report on geologic sequestration in the
United States, and, to the extent relevant, other countries in North
America. Such report shall include--
``(1) data regarding injection, emissions to the
atmosphere, if any, and performance of active and closed
geologic sequestration sites, including those where enhanced
hydrocarbon recovery operations occur;
``(2) an evaluation of the performance of relevant Federal
environmental regulations and programs in ensuring
environmentally protective geologic sequestration practices;
``(3) recommendations on how such programs and regulations
should be improved or made more effective; and
``(4) other relevant information.''.
(b) Safe Drinking Water Act Standards.--Section 1421 of the Safe
Drinking Water Act (42 U.S.C. 300h) is amended by inserting after
subsection (d) the following:
``(e) Carbon Dioxide Geologic Sequestration Wells.--
``(1) In general.--Not later than 1 year after the date of
enactment of this subsection, the Administrator shall
promulgate regulations under subsection (a) for carbon dioxide
geologic sequestration wells.
``(2) Financial responsibility.--The regulations referred
to in paragraph (1) shall include requirements for maintaining
evidence of financial responsibility, including financial
responsibility for emergency and remedial response, well
plugging, site closure, and post-injection site care. Financial
responsibility may be established for carbon dioxide geologic
sequestration wells in accordance with regulations promulgated
by the Administrator by any one, or any combination, of the
following: insurance, guarantee, trust, standby trust, surety
bond, letter of credit, qualification as a self-insurer, or any
other method satisfactory to the Administrator.''.
SEC. 113. STUDIES AND REPORTS.
(a) Study of Legal Framework for Geologic Sequestration Sites.--
(1) Establishment of task force.--As soon as practicable,
but not later than 6 months after the date of enactment of this
Act, the Administrator shall establish a task force to be
composed of an equal number of subject matter experts,
nongovernmental organizations with expertise in environmental
policy, academic experts with expertise in environmental law,
State and tribal officials with environmental expertise,
representatives of State and tribal Attorneys General,
representatives from the Environmental Protection Agency, the
Department of the Interior, the Department of Energy, the
Department of Transportation, and other relevant Federal
agencies, and members of the private sector, to conduct a study
of--
(A) existing Federal environmental statutes, State
environmental statutes, and State common law that apply
to geologic sequestration sites for carbon dioxide,
including the ability of such laws to serve as risk
management tools;
(B) the existing statutory framework, including
Federal and State laws, that apply to harm and damage
to the environment or public health at closed sites
where carbon dioxide injection has been used for
enhanced hydrocarbon recovery;
(C) the statutory framework, environmental health
and safety considerations, implementation issues, and
financial implications of potential models for Federal,
State, or private sector assumption of liabilities and
financial responsibilities with respect to closed
geologic sequestration sites;
(D) private sector mechanisms, including insurance
and bonding, that may be available to manage
environmental, health and safety risk from closed
geologic sequestration sites; and
(E) the subsurface mineral rights, water rights, or
property rights issues associated with geologic
sequestration of carbon dioxide, including issues
specific to Federal lands.
(2) Report.--Not later than 18 months after the date of
enactment of this Act, the task force established under
paragraph (1) shall submit to Congress a report describing the
results of the study conducted under that paragraph including
any consensus recommendations of the task force.
(b) Environmental Statutes.--
(1) Study.--The Administrator shall conduct a study
examining how, and under what circumstances, the environmental
statutes for which the Environmental Protection Agency has
responsibility would apply to carbon dioxide injection and
geologic sequestration activities.
(2) Report.--Not later than 1 year after the date of
enactment of this Act, the Administrator shall submit to
Congress a report describing the results of the study conducted
under paragraph (1).
SEC. 114. CARBON CAPTURE AND SEQUESTRATION DEMONSTRATION AND EARLY
DEPLOYMENT PROGRAM.
(a) Definitions.--For purposes of this section:
(1) Secretary.--The term ``Secretary'' means the Secretary
of Energy.
(2) Distribution utility.--The term ``distribution
utility'' means an entity that distributes electricity directly
to retail consumers under a legal, regulatory, or contractual
obligation to do so.
(3) Electric utility.--The term ``electric utility'' has
the meaning provided by section 3(22) of the Federal Power Act
(16 U.S.C. 796(22)).
(4) Fossil fuel-based electricity.--The term ``fossil fuel-
based electricity'' means electricity that is produced from the
combustion of fossil fuels.
(5) Fossil fuel.--The term ``fossil fuel'' means coal,
petroleum, natural gas or any derivative of coal, petroleum, or
natural gas.
(6) Corporation.--The term ``Corporation'' means the Carbon
Storage Research Corporation established in accordance with
this section.
(7) Qualified industry organization.--The term ``qualified
industry organization'' means the Edison Electric Institute,
the American Public Power Association, the National Rural
Electric Cooperative Association, a successor organization of
such organizations, or a group of owners or operators of
distribution utilities delivering fossil fuel-based electricity
who collectively represent at least 20 percent of the volume of
fossil fuel-based electricity delivered by distribution
utilities to consumers in the United States.
(8) Retail consumer.--The term ``retail consumer'' means an
end-user of electricity.
(b) Carbon Storage Research Corporation.--
(1) Establishment.--
(A) Referendum.--Qualified industry organizations
may conduct, at their own expense, a referendum among
the owners or operators of distribution utilities
delivering fossil fuel-based electricity for the
creation of a Carbon Storage Research Corporation. Such
referendum shall be conducted by an independent
auditing firm agreed to by the qualified industry
organizations. Voting rights in such referendum shall
be based on the quantity of fossil fuel-based
electricity delivered to consumers in the previous
calendar year or other representative period as
determined by the Secretary pursuant to subsection (f).
Upon approval of those persons representing two-thirds
of the total quantity of fossil fuel-based electricity
delivered to retail consumers, the Corporation shall be
established unless opposed by the State regulatory
authorities pursuant to subparagraph (B). All
distribution utilities voting in the referendum shall
certify to the independent auditing firm the quantity
of fossil fuel-based electricity represented by their
vote.
(B) State regulatory authorities.--Upon its own
motion or the petition of a qualified industry
organization, each State regulatory authority shall
consider its support or opposition to the creation of
the Corporation under subparagraph (A). State
regulatory authorities may notify the independent
auditing firm referred to in subparagraph (A) of their
views on the creation of the Corporation within 180
days after the date of enactment of this Act. If 40
percent or more of the State regulatory authorities
submit to the independent auditing firm written notices
of opposition, the Corporation shall not be established
notwithstanding the approval of the qualified industry
organizations as provided in subparagraph (A).
(2) Termination.--The Corporation shall be authorized to
collect assessments and conduct operations pursuant to this
section for a 10-year period from the date 6 months after the
date of enactment of this Act. After such 10-year period, the
Corporation is no longer authorized to collect assessments and
shall be dissolved on the date 15 years after such date of
enactment, unless the period is extended by an Act of Congress.
(3) Governance.--The Corporation shall operate as a
division or affiliate of the Electric Power Research Institute
(referred to in this section as ``EPRI'') and be managed by a
Board of not more than 15 voting members responsible for its
operations, including compliance with this section. EPRI, in
consultation with the Edison Electric Institute, the American
Public Power Association and the National Rural Electric
Cooperative Association shall appoint the Board members under
clauses (i), (ii), and (iii) of subparagraph (A) from among
candidates recommended by those organizations. At least a
majority of the Board members appointed by EPRI shall be
representatives of distribution utilities subject to
assessments under subsection (d).
(A) Members.--The Board shall include at least one
representative of each of the following:
(i) Investor-owned utilities.
(ii) Utilities owned by a State agency, a
municipality, and an Indian tribe.
(iii) Rural electric cooperatives.
(iv) Fossil fuel producers.
(v) Nonprofit environmental organizations.
(vi) Independent generators or wholesale
power providers.
(vii) Consumer groups.
(B) Nonvoting members.--The Board shall also
include as additional nonvoting Members the Secretary
of Energy or his designee and 2 representatives of
State regulatory authorities as defined in section
3(17) of the Public Utility Regulatory Policies Act of
1978 (16 U.S.C. 2602(17)), each designated by the
National Association of State Regulatory Utility
Commissioners from States that are not within the same
transmission interconnection.
(4) Compensation.--Corporation Board members shall receive
no compensation for their services, nor shall Corporation Board
members be reimbursed for expenses relating to their service.
(5) Terms.--Corporation Board members shall serve terms of
4 years and may serve not more than 2 full consecutive terms.
Members filling unexpired terms may serve not more than a total
of 8 consecutive years. Former members of the Corporation Board
may be reappointed to the Corporation Board if they have not
been members for a period of 2 years. Initial appointments to
the Corporation Board shall be for terms of 1, 2, 3, and 4
years, staggered to provide for the selection of 3 members each
year.
(6) Status of corporation.--The Corporation shall not be
considered to be an agency, department, or instrumentality of
the United States, and no officer or director or employee of
the Corporation shall be considered to be an officer or
employee of the United States Government, for purposes of title
5 or title 31 of the United States Code, or for any other
purpose, and no funds of the Corporation shall be treated as
public money for purposes of chapter 33 of title 31, United
States Code, or for any other purpose.
(c) Functions and Administration of the Corporation.--
(1) In general.--The Corporation shall establish and
administer a program to accelerate the commercial availability
of carbon dioxide capture and storage technologies and methods,
including technologies which capture and store, or capture and
convert, carbon dioxide. Under such program competitively
awarded grants, contracts, and financial assistance shall be
provided and entered into with eligible entities. Except as
provided in paragraph (8), the Corporation shall use all funds
derived from assessments under subsection (d) to issue grants
and contracts to eligible entities.
(2) Purpose.--The purposes of the grants, contracts, and
assistance under this subsection shall be to support
commercial-scale demonstrations of carbon capture or storage
technology projects capable of advancing the technologies to
commercial readiness. Such projects should encompass a range of
different coal and other fossil fuel varieties, be
geographically diverse, involve diverse storage media, and
employ capture or storage, or capture and conversion,
technologies potentially suitable either for new or for
retrofit applications. The Corporation shall seek, to the
extent feasible, to support at least 5 commercial-scale
demonstration projects integrating carbon capture and
sequestration or conversion technologies.
(3) Eligible entities.--Entities eligible for grants,
contracts or assistance under this subsection may include
distribution utilities, electric utilities and other private
entities, academic institutions, national laboratories, Federal
research agencies, State and tribal research agencies,
nonprofit organizations, or consortiums of 2 or more entities.
Pilot-scale and similar small-scale projects are not eligible
for support by the Corporation. Owners or developers of
projects supported by the Corporation shall, where appropriate,
share in the costs of such projects.
(4) Grants for early movers.--Fifty percent of the funds
raised under this section shall be provided in the form of
grants to electric utilities that had, prior to the award of
any grant under this section, committed resources to deploy a
large scale electricity generation unit with integrated carbon
capture and sequestration or conversion applied to a
substantial portion of the unit's carbon dioxide emissions.
Grant funds shall be provided to defray costs incurred by such
electricity utilities for at least 5 such electricity
generation units.
(5) Administration.--The members of the Board of Directors
of the Corporation shall elect a Chairman and other officers as
necessary, may establish committees and subcommittees of the
Corporation, and shall adopt rules and bylaws for the conduct
of business and the implementation of this section. The Board
shall appoint an Executive Director and professional support
staff who may be employees of the Electric Power Research
Institute (EPRI). After consultation with the Technical
Advisory Committee established under subsection (j), the
Secretary, and the Director of the National Energy Technology
Laboratory to obtain advice and recommendations on plans,
programs, and project selection criteria, the Board shall
establish priorities for grants, contracts, and assistance;
publish requests for proposals for grants, contracts, and
assistance; and award grants, contracts, and assistance
competitively, on the basis of merit, after the establishment
of procedures that provide for scientific peer review by the
Technical Advisory Committee. The Board shall give preference
to applications that reflect the best overall value and
prospect for achieving the purposes of the section, such as
those which demonstrate an integrated approach for capture and
storage or capture and conversion technologies. The Board
members shall not participate in making grants or awards to
entities with whom they are affiliated.
(6) Uses of grants, contracts, and assistance.--A grant,
contract, or other assistance provided under this subsection
may be used to purchase carbon dioxide when needed to conduct
tests of carbon dioxide storage sites, in the case of
established projects that are storing carbon dioxide emissions,
or for other purposes consistent with the purposes of this
section. The Corporation shall make publicly available at no
cost information learned as a result of projects which it
supports financially.
(7) Intellectual property.--The Board shall establish
policies regarding the ownership of intellectual property
developed as a result of Corporation grants and other forms of
technology support. Such policies shall encourage individual
ingenuity and invention.
(8) Administrative expenses.--Up to 5 percent of the funds
collected in any fiscal year under subsection (d) may be used
for the administrative expenses of operating the Corporation
(not including costs incurred in the determination and
collection of the assessments pursuant to subsection (d)).
(9) Programs and budget.--Before August 1 each year, the
Corporation, after consulting with the Technical Advisory
Committee and the Secretary and the Director of the
Department's National Energy Technology Laboratory and other
interested parties to obtain advice and recommendations, shall
publish for public review and comment its proposed plans,
programs, project selection criteria, and projects to be funded
by the Corporation for the next calendar year. The Corporation
shall also publish for public review and comment a budget plan
for the next calendar year, including the probable costs of all
programs, projects, and contracts and a recommended rate of
assessment sufficient to cover such costs. The Secretary may
recommend programs and activities the Secretary considers
appropriate. The Corporation shall include in the first
publication it issues under this paragraph a strategic plan or
roadmap for the achievement of the purposes of the Corporation,
as set forth in paragraph (2).
(10) Records; audits.--The Corporation shall keep minutes,
books, and records that clearly reflect all of the acts and
transactions of the Corporation and make public such
information. The books of the Corporation shall be audited by a
certified public accountant at least once each fiscal year and
at such other times as the Corporation may designate. Copies of
each audit shall be provided to the Congress, all Corporation
board members, all qualified industry organizations, each State
regulatory authority and, upon request, to other members of the
industry. If the audit determines that the Corporation's
practices fail to meet generally accepted accounting principles
the assessment collection authority of the Corporation under
subsection (d) shall be suspended until a certified public
accountant renders a subsequent opinion that the failure has
been corrected. The Corporation shall make its books and
records available for review by the Secretary or the
Comptroller General of the United States.
(11) Public access.--The Corporation Board's meetings shall
be open to the public and shall occur after at least 30 days
advance public notice. Meetings of the Board of Directors may
be closed to the public where the agenda of such meetings
includes only confidential matters pertaining to project
selection, the award of grants or contracts, personnel matters,
or the receipt of legal advice. The minutes of all meetings of
the Corporation shall be made available to and readily
accessible by the public.
(12) Annual report.--Each year the Corporation shall
prepare and make publicly available a report which includes an
identification and description of all programs and projects
undertaken by the Corporation during the previous year. The
report shall also detail the allocation or planned allocation
of Corporation resources for each such program and project. The
Corporation shall provide its annual report to the Congress,
the Secretary, each State regulatory authority, and upon
request to the public. The Secretary shall, not less than 60
days after receiving such report, provide to the President and
Congress a report assessing the progress of the Corporation in
meeting the objectives of this section.
(d) Assessments.--
(1) Amount.--(A) In all calendar years following its
establishment, the Corporation shall collect an assessment on
distribution utilities for all fossil fuel-based electricity
delivered directly to retail consumers (as determined under
subsection (f)). The assessments shall reflect the relative
carbon dioxide emission rates of different fossil fuel-based
electricity, and initially shall be not less than the following
amounts for coal, natural gas, and oil:
Fuel type Rate of assessment per kilowatt
hour
Coal................................ $0.00043
Natural Gas......................... $0.00022
Oil................................. $0.00032.
(B) The Corporation is authorized to adjust the assessments
on fossil fuel-based electricity to reflect changes in the
expected quantities of such electricity from different fuel
types, such that the assessments generate not less than $1.0
billion and not more than $1.1 billion annually. The
Corporation is authorized to supplement assessments through
additional financial commitments.
(2) Investment of funds.--Pending disbursement pursuant to
a program, plan, or project, the Corporation may invest funds
collected through assessments under this subsection, and any
other funds received by the Corporation, only in obligations of
the United States or any agency thereof, in general obligations
of any State or any political subdivision thereof, in any
interest-bearing account or certificate of deposit of a bank
that is a member of the Federal Reserve System, or in
obligations fully guaranteed as to principal and interest by
the United States.
(3) Reversion of unused funds.--If the Corporation does not
disburse, dedicate or assign 75 percent or more of the
available proceeds of the assessed fees in any calendar year 7
or more years following its establishment, due to an absence of
qualified projects or similar circumstances, it shall reimburse
the remaining undedicated or unassigned balance of such fees,
less administrative and other expenses authorized by this
section, to the distribution utilities upon which such fees
were assessed, in proportion to their collected assessments.
(e) ERCOT.--
(1) Assessment, collection, and remittance.--(A)
Notwithstanding any other provision of this section, within
ERCOT, the assessment provided for in subsection (d) shall be--
(i) levied directly on qualified scheduling
entities, or their successor entities;
(ii) charged consistent with other charges imposed
on qualified scheduling entities as a fee on energy
used by the load-serving entities; and
(iii) collected and remitted by ERCOT to the
Corporation in the amounts and in the same manner as
set forth in subsection (d).
(B) The assessment amounts referred to in subparagraph (A)
shall be--
(i) determined by the amount and types of fossil
fuel-based electricity delivered directly to all retail
customers in the prior calendar year beginning with the
year ending immediately prior to the period described
in subsection (b)(2); and
(ii) take into account the number of renewable
energy credits retired by the load-serving entities
represented by a qualified scheduling entity within the
prior calendar year.
(2) Administration expenses.--Up to 1 percent of the funds
collected in any fiscal year by ERCOT under the provisions of
this subsection may be used for the administrative expenses
incurred in the determination, collection and remittance of the
assessments to the Corporation.
(3) Audit.--ERCOT shall provide a copy of its annual audit
pertaining to the administration of the provisions of this
subsection to the Corporation.
(4) Definitions.--For the purposes of this subsection:
(A) The term ``ERCOT'' means the Electric
Reliability Council of Texas.
(B) The term ``load-serving entities'' has the
meaning adopted by ERCOT Protocols and in effect on the
date of enactment of this Act.
(C) The term ``qualified scheduling entities'' has
the meaning adopted by ERCOT Protocols and in effect on
the date of enactment of this Act.
(D) The term ``renewable energy credit'' has the
meaning as promulgated and adopted by the Public
Utility Commission of Texas pursuant to section
39.904(b) of the Public Utility Regulatory Act of 1999,
and in effect on the date of enactment of this Act.
(f) Determination of Fossil Fuel-based Electricity Deliveries.--
(1) Findings.--The Congress finds that:
(A) The assessments under subsection (d) are to be
collected based on the amount of fossil fuel-based
electricity delivered by each distribution utility.
(B) Since many distribution utilities purchase all
or part of their retail consumer's electricity needs
from other entities, it may not be practical to
determine the precise fuel mix for the power sold by
each individual distribution utility.
(C) It may be necessary to use average data, often
on a regional basis with reference to Regional
Transmission Organization (``RTO'') or NERC regions, to
make the determinations necessary for making
assessments.
(2) DOE proposed rule.--The Secretary, acting in close
consultation with the Energy Information Administration, shall
issue for notice and comment a proposed rule to determine the
level of fossil fuel electricity delivered to retail customers
by each distribution utility in the United States during the
most recent calendar year or other period determined to be most
appropriate. Such proposed rule shall balance the need to be
efficient, reasonably precise, and timely, taking into account
the nature and cost of data currently available and the nature
of markets and regulation in effect in various regions of the
country. Different methodologies may be applied in different
regions if appropriate to obtain the best balance of such
factors.
(3) Final rule.--Within 6 months after the date of
enactment of this Act, and after opportunity for comment, the
Secretary shall issue a final rule under this subsection for
determining the level and type of fossil fuel-based electricity
delivered to retail customers by each distribution utility in
the United States during the appropriate period. In issuing
such rule, the Secretary may consider opportunities and costs
to develop new data sources in the future and issue
recommendations for the Energy Information Administration or
other entities to collect such data. After notice and
opportunity for comment the Secretary may, by rule,
subsequently update and modify the methodology for making such
determinations.
(4) Annual determinations.--Pursuant to the final rule
issued under paragraph (3), the Secretary shall make annual
determinations of the amounts and types for each such utility
and publish such determinations in the Federal Register. Such
determinations shall be used to conduct the referendum under
subsection (b) and by the Corporation in applying any
assessment under this subsection.
(5) Rehearing and judicial review.--The owner or operator
of any distribution utility that believes that the Secretary
has misapplied the methodology in the final rule in determining
the amount and types of fossil fuel electricity delivered by
such distribution utility may seek rehearing of such
determination within 30 days of publication of the
determination in the Federal Register. The Secretary shall
decide such rehearing petitions within 30 days. The Secretary's
determinations following rehearing shall be final and subject
to judicial review in the United States Court of Appeals for
the District of Columbia.
(g) Compliance With Corporation Assessments.--The Corporation may
bring an action in the appropriate court of the United States to compel
compliance with an assessment levied by the Corporation under this
section. A successful action for compliance under this subsection may
also require payment by the defendant of the costs incurred by the
Corporation in bringing such action.
(h) Midcourse Review.--Not later than 5 years following
establishment of the Corporation, the Comptroller General of the United
States shall prepare an analysis, and report to Congress, assessing the
Corporation's activities, including project selection and methods of
disbursement of assessed fees, impacts on the prospects for
commercialization of carbon capture and storage technologies, adequacy
of funding, and administration of funds. The report shall also make
such recommendations as may be appropriate in each of these areas. The
Corporation shall reimburse the Government Accountability Office for
the costs associated with performing this midcourse review.
(i) Recovery of Costs.--
(1) In general.--A distribution utility whose transmission,
delivery, or sales of electric energy are subject to any form
of rate regulation shall not be denied the opportunity to
recover the full amount of the prudently incurred costs
associated with complying with this section, consistent with
applicable State or Federal law.
(2) Ratepayer rebates.--Regulatory authorities that approve
cost recovery pursuant to paragraph (1) may order rebates to
ratepayers to the extent that distribution utilities are
reimbursed undedicated or unassigned balances pursuant to
subsection (d)(3).
(j) Technical Advisory Committee.--
(1) Establishment.--There is established an advisory
committee, to be known as the ``Technical Advisory Committee''.
(2) Membership.--The Technical Advisory Committee shall be
comprised of not less than 7 members appointed by the Board
from among academic institutions, national laboratories,
independent research institutions, and other qualified
institutions. No member of the Committee shall be affiliated
with EPRI or with any organization having members serving on
the Board. At least one member of the Committee shall be
appointed from among officers or employees of the Department of
Energy recommended to the Board by the Secretary of Energy.
(3) Chairperson and vice chairperson.--The Board shall
designate one member of the Technical Advisory Committee to
serve as Chairperson of the Committee and one to serve as Vice
Chairperson of the Committee.
(4) Compensation.--The Board shall provide compensation to
members of the Technical Advisory Committee for travel and
other incidental expenses and such other compensation as the
Board determines to be necessary.
(5) Purpose.--The Technical Advisory Committee shall
provide independent assessments and technical evaluations, as
well as make non-binding recommendations to the Board,
concerning Corporation activities, including but not limited to
the following:
(A) Reviewing and evaluating the Corporation's
plans and budgets described in subsection (c)(9), as
well as any other appropriate areas, which could
include approaches to prioritizing technologies,
appropriateness of engineering techniques, monitoring
and verification technologies for storage, geological
site selection, and cost control measures.
(B) Making annual non-binding recommendations to
the Board concerning any of the matters referred to in
subparagraph (A), as well as what types of investments,
scientific research, or engineering practices would
best further the goals of the Corporation.
(6) Public availability.--All reports, evaluations, and
other materials of the Technical Advisory Committee shall be
made available to the public by the Board, without charge, at
time of receipt by the Board.
(k) Lobbying Restrictions.--No funds collected by the Corporation
shall be used in any manner for influencing legislation or elections,
except that the Corporation may recommend to the Secretary and the
Congress changes in this section or other statutes that would further
the purposes of this section.
(l) Davis-Bacon Compliance.--The Corporation shall ensure that
entities receiving grants, contracts, or other financial support from
the Corporation for the project activities authorized by this section
are in compliance with the Davis-Bacon Act (40 U.S.C. 276a-276a-5).
SEC. 115. COMMERCIAL DEPLOYMENT OF CARBON CAPTURE AND SEQUESTRATION
TECHNOLOGIES.
Part H of title VII of the Clean Air Act (as added by section 321
of this Act) is amended by adding the following new section after
section 785:
``SEC. 786. COMMERCIAL DEPLOYMENT OF CARBON CAPTURE AND SEQUESTRATION
TECHNOLOGIES.
``(a) Regulations.--Not later than 2 years after the date of
enactment of this title, the Administrator shall promulgate regulations
providing for the distribution of emission allowances allocated
pursuant to section 782(f), pursuant to the requirements of this
section, to support the commercial deployment of carbon capture and
sequestration technologies in both electric power generation and
industrial operations.
``(b) Eligibility Criteria.--For an owner or operator of a project
to be eligible to receive emission allowances under this section, the
project must--
``(1) implement carbon capture and sequestration
technology--
``(A) at an electric generating unit that--
``(i) has a nameplate capacity of 200
megawatts or more;
``(ii) in the case of a retrofit
application, applies the carbon capture and
sequestration technology to the flue gas from
at least 200 megawatts of the total nameplate
generating capacity of the unit, provided that
clause (i) shall apply without exception;
``(iii) derives at least 50 percent of its
annual fuel input from coal, petroleum coke, or
any combination of these 2 fuels; and
``(iv) upon implementation of capture and
sequestration technology, will achieve an
emission limit that is at least a 50 percent
reduction in emissions of the carbon dioxide
produced by--
``(I) the unit, measured on an
annual basis, determined in accordance
with section 812(b)(2); or
``(II) in the case of retrofit
applications under clause (ii), the
treated portion of flue gas from the
unit, measured on an annual basis,
determined in accordance with section
812(b)(2); or
``(B) at an industrial source that--
``(i) absent carbon capture and
sequestration, would emit greater than 50,000
tons per year of carbon dioxide;
``(ii) upon implementation, will achieve an
emission limit that is at least a 50 percent
reduction in emissions of the carbon dioxide
produced by the emission point, measured on an
annual basis, determined in accordance with
section 812(b)(2); and
``(iii) does not produce a liquid
transportation fuel from a solid fossil-based
feedstock;
``(2) geologically sequester carbon dioxide at a site that
meets all applicable permitting and certification requirements
for geologic sequestration, or, pursuant to such requirements
as the Administrator may prescribe by regulation, convert
captured carbon dioxide to a stable form that will safely and
permanently sequester such carbon dioxide;
``(3) meet all other applicable State, tribal, and Federal
permitting requirements; and
``(4) be located in the United States.
``(c) Phase I Distribution to Electric Generating Units.--
``(1) Application.--This subsection shall apply only to
projects at the first 6 gigawatts of electric generating units,
measured in cumulative generating capacity of such units, that
receive allowances under this section.
``(2) Distribution.--The Administrator shall distribute
emission allowances allocated under section 782(f) to the owner
or operator of each eligible project at an electric generating
unit in a quantity equal to the quotient obtained by dividing--
``(A) the product obtained by multiplying--
``(i) the number of metric tons of carbon
dioxide emissions avoided through capture and
sequestration of emissions by the project, as
determined pursuant to such methodology as the
Administrator shall prescribe by regulation;
and
``(ii) a bonus allowance value, pursuant to
paragraph (3); by
``(B) the average fair market value of an emission
allowance during the preceding year.
``(3) Bonus allowance values.--
``(A) For a generating unit achieving the capture
and sequestration of 85 percent or more of the carbon
dioxide that otherwise would be emitted by such unit,
the bonus allowance value shall be $90 per ton.
``(B) The Administrator shall by regulation
establish a bonus allowance value for each rate of
lower capture and sequestration achieved by a
generating unit, from a minimum of $50 per ton for a 50
percent rate and varying directly with increasing rates
of capture and sequestration up to $90 per ton for an
85 percent rate.
``(C) For a generating unit that achieves the
capture and sequestration of at least 50 percent of the
carbon dioxide that otherwise would be emitted by such
unit by not later than January 1, 2017, the otherwise
applicable bonus allowance value under this paragraph
shall be increased by $10, provided that the owner of
such unit notifies the Administrator by not later than
January 1, 2012, of its intent to achieve such rate of
capture and sequestration.
``(D) For a carbon capture and sequestration
project sequestering in a geological formation for
purposes of enhanced hydrocarbon recovery, the
Administrator shall, by regulation, reduce the
applicable bonus allowance value under this paragraph
to reflect the lower net cost of the project when
compared to sequestration into geological formations
solely for purposes of sequestration.
``(E) The Administrator shall annually adjust for
inflation the bonus allowance values established under
this paragraph.
``(d) Phase II Distribution to Electric Generating Units.--
``(1) Application.--This subsection shall apply only to the
distribution of emission allowances for carbon capture and
sequestration projects at electric generating units after the
capacity threshold identified in subsection (c)(1) is reached.
``(2) Regulations.--Not later than 2 years prior to the
date on which the capacity threshold identified in subsection
(c)(1) is projected to be reached, the Administrator shall
promulgate regulations to govern the distribution of emission
allowances to the owners or operators of eligible projects
under this subsection.
``(3) Reverse auctions.--
``(A) In general.--Except as provided in paragraph
(4), the regulations promulgated under paragraph (2)
shall provide for the distribution of emission
allowances to the owners or operators of eligible
projects under this subsection through reverse
auctions, which shall be held no less frequently than
once each calendar year. The Administrator may
establish a separate auction for each of no more than 5
different project categories, defined on the basis of
coal type, capture technology, geological formation
type, new unit versus retrofit application, such other
factors as the Administrator may prescribe, or any
combination thereof. The Administrator may establish
appropriate minimum rates of capture and sequestration
in implementing this paragraph.
``(B) Auction process.--At each reverse auction--
``(i) the Administrator shall solicit bids
from eligible projects;
``(ii) eligible projects participating in
the auction shall submit a bid including the
desired level of carbon dioxide sequestration
incentive per ton and the estimated quantity of
carbon dioxide that the project will
permanently sequester over 10 years; and
``(iii) the Administrator shall select
bids, within each auction, for the
sequestration amount submitted, beginning with
the eligible project submitting the bid for the
lowest level of sequestration incentive on a
per ton basis and meeting such other
requirements as the Administrator may specify,
until the amount of funds available for the
reverse auction is committed.
``(C) Form of distribution.--The Administrator
shall distribute emission allowances to the owners or
operators of eligible projects selected through a
reverse auction under this paragraph pursuant to a
formula equivalent to that described in subsection
(c)(2), except that the bonus allowance value that is
bid by the entity shall be substituted for the bonus
allowance values set forth in subsection (c)(3).
``(4) Alternative distribution method.--
``(A) In general.--If the Administrator determines
that reverse auctions would not provide for efficient
and cost-effective commercial deployment of carbon
capture and sequestration technologies, the
Administrator may instead, through regulations
promulgated under paragraph (2) or (5), prescribe a
schedule for the award of bonus allowances to the
owners or operators of eligible projects under this
subsection, in accordance with the requirements of this
paragraph.
``(B) Multiple tranches.--The Administrator shall
divide emission allowances available for distribution
to the owners or operators of eligible projects into a
series of tranches, each supporting the deployment of a
specified quantity of cumulative electric generating
capacity utilizing carbon capture and sequestration
technology, each of which shall not be greater than 6
gigawatts.
``(C) Method of distribution.--The Administrator
shall distribute emission allowances within each
tranche, on a first-come, first-served basis--
``(i) based on the date of full-scale
operation of capture and sequestration
technology; and
``(ii) pursuant to a formula, similar to
that set forth in subsection (c)(2) (except
that the Administrator shall prescribe bonus
allowance values different than those set forth
in subsection (c)(3)), establishing the number
of allowances to be distributed per ton of
carbon dioxide sequestered by the project.
``(D) Requirements.--For each tranche established
pursuant to subparagraph (B), the Administrator shall
establish a schedule for distributing emission
allowances that--
``(i) is based on a sliding scale that
provides higher bonus allowance values for
projects achieving higher rates of capture and
sequestration;
``(ii) for each capture and sequestration
rate, establishes a bonus allowance value that
is lower than that established for such rate in
the previous tranche (or, in the case of the
first tranche, than that established for such
rate under subsection (c)(3)); and
``(iii) may establish different bonus
allowance levels for no more than 5 different
project categories, defined by coal type,
capture technology, geological formation type,
new unit versus retrofit application, such
other factors as the Administrator may
prescribe, or any combination thereof.
``(E) Criteria for establishing bonus allowance
values.--In setting bonus allowance values under this
paragraph, the Administrator shall seek to cover no
more than the reasonable incremental capital and
operating costs of a project that are attributable to
implementation of carbon capture, transportation, and
sequestration technologies, taking into account--
``(i) the reduced cost of compliance with
section 722 of this Act;
``(ii) the reduced cost associated with
sequestering in a geological formation for
purposes of enhanced hydrocarbon recovery when
compared to sequestration into geological
formations solely for purposes of
sequestration;
``(iii) the relevant factors defining the
project category; and
``(iv) such other factors as the
Administrator determines are appropriate.
``(5) Revision of regulations.--The Administrator shall
review, and as appropriate revise, the applicable regulations
under this subsection no less frequently than every 8 years.
``(e) Limits for Certain Electric Generating Units.--
``(1) Definitions.--For purposes of this subsection, the
terms `covered EGU' and `initially permitted' shall have the
meaning given those terms in section 812 of this Act.
``(2) Covered egus initially permitted from 2009 through
2014.--For a covered EGU that is initially permitted on or
after January 1, 2009, and before January 1, 2015, the
Administrator shall reduce the quantity of emission allowances
that the owner or operator of such covered EGU would otherwise
be eligible to receive under this section as follows:
``(A) In the case of a unit commencing operation on
or before January 1, 2019, if the date in clause
(ii)(I) is earlier than the date in clause (ii)(II), by
the product of--
``(i) 20 percent; and
``(ii) the number of years, if any, that
have elapsed between--
``(I) the earlier of January 1,
2020, or the date that is 5 years after
the commencement of operation of such
covered EGU; and
``(II) the first year that such
covered EGU achieves (and thereafter
maintains) an emission limit that is at
least a 50 percent reduction in
emissions of the carbon dioxide
produced by the unit, measured on an
annual basis, as determined in
accordance with section 812(b)(2).
``(B) In the case of a unit commencing operation
after January 1, 2019, by the product of--
``(i) 20 percent; and
``(ii) the number of years between--
``(I) the commencement of operation
of such covered EGU; and
``(II) the first year that such
covered EGU achieves (and thereafter
maintains) an emission limit that is at
least a 50 percent reduction in
emissions of the carbon dioxide
produced by the unit, measured on an
annual basis, as determined in
accordance with section 812(b)(2).
``(3) Covered egus initially permitted from 2015 through
2019.--The owner or operator of a covered EGU that is initially
permitted on or after January 1, 2015, and before January 1,
2020, shall be ineligible to receive emission allowances
pursuant to this section if such unit, upon commencement of
operations (and thereafter), does not achieve and maintain an
emission limit that is at least a 50 percent reduction in
emissions of the carbon dioxide produced by the unit, measured
on an annual basis, as determined in accordance with section
812(b)(2).
``(f) Industrial Sources.--
``(1) Allowances.--The Administrator may distribute not
more than 15 percent of the allowances allocated under section
782(f) for any vintage year to the owners or operators of
eligible industrial sources to support the commercial-scale
deployment of carbon capture and sequestration technologies at
such sources.
``(2) Distribution.--The Administrator shall, by
regulation, prescribe requirements for the distribution of
emission allowances to the owners or operators of industrial
sources under this subsection, based on a bonus allowance
formula that awards allowances to qualifying projects on the
basis of tons of carbon dioxide captured and permanently
sequestered. The Administrator may provide for the distribution
of emission allowances pursuant to--
``(A) a reverse auction method, similar to that
described under subsection (d)(3), including the use of
separate auctions for different project categories; or
``(B) an incentive schedule, similar to that
described under subsection (d)(4), which shall ensure
that incentives are set so as to satisfy the
requirement described in subsection (d)(4)(E).
``(3) Revision of regulations.--The Administrator shall
review, and as appropriate revise, the applicable regulations
under this subsection no less frequently than every 8 years.
``(g) Limitations.--Allowances may be distributed under this
section only for tons of carbon dioxide emissions that have already
been captured and sequestered. A qualifying project may receive annual
emission allowances under this section only for the first 10 years of
operation. No greater than 72 gigawatts of total cumulative generating
capacity (including industrial applications, measured by such
equivalent metric as the Administrator may designate) may receive
emission allowances under this section. Upon reaching the limit
described in the preceding sentence, any emission allowances that are
allocated for carbon capture and sequestration deployment under section
782(f) and are not yet obligated under this section shall be treated as
allowances not designated for distribution for purposes of section
782(r).
``(h) Exhaustion of Account and Annual Roll-over of Surplus
Allowances.--
``(1) In distributing emission allowances under this
section, the Administrator shall ensure that qualifying
projects receiving allowances receive distributions for 10
years.
``(2) If the Administrator determines that the emission
allowances allocated under section 782(f) with a vintage year
that matches the year of distribution will be exhausted once
the estimated full 10-year distributions will be provided to
current eligible participants, the Administrator shall provide
to new eligible projects allowances from vintage years after
the year of the distribution.
``(i) Retrofit Applications.--(1) In calculating bonus allowance
values for retrofit applications eligible under subsection
(b)(1)(A)(ii) and (iv)(II), the Administrator shall apply the required
capture rates with respect to the treated portion of flue gas from the
unit.
``(2) No additional projects shall be eligible for allowances under
subsection (b)(1)(A)(ii) and (iv)(II) as of such time as the
Administrator reports, pursuant to section 812(d), that carbon capture
and sequestration retrofit projects at electric generating units that
are eligible for allowances under this section have been applied, in
the aggregate, to the flue gas generated by 1 gigawatt of total
cumulative generating capacity. The limitation in the preceding
sentence shall not apply to projects that meet the eligibility criteria
in subsection (b)(1)(A)(iv)(I).
``(j) Davis-Bacon Compliance.--All laborers and mechanics employed
on projects funded directly by or assisted in whole or in part by this
section through the use of emission allowances shall be paid wages at
rates not less than those prevailing on projects of a character similar
in the locality as determined by the Secretary of Labor in accordance
with subchapter IV, chapter 31, part A of subtitle II of title 40,
United States Code. With respect to the labor standards specified in
this subsection, the Secretary of Labor shall have the authority and
functions set forth in Reorganization Plan Numbered 14 of 1950 (64
Stat. 1267; 5 U.S.C. App.) and section 3145 of title 40, United States
Code.''.
SEC. 116. PERFORMANCE STANDARDS FOR COAL-FUELED POWER PLANTS.
(a) In General.--Title VIII of the Clean Air Act (as added by
section 331 of this Act) is amended by adding the following new section
after section 811:
``SEC. 812. PERFORMANCE STANDARDS FOR NEW COAL-FIRED POWER PLANTS.
``(a) Definitions.--For purposes of this section:
``(1) Covered egu.--The term `covered EGU' means a utility
unit that is required to have a permit under section 503(a) and
is authorized under state or federal law to derive at least 30
percent of its annual heat input from coal, petroleum coke, or
any combination of these fuels.
``(2) Initially permitted.--The term `initially permitted'
means that the owner or operator has received a Clean Air Act
preconstruction approval or permit, for the covered EGU as a
new (not a modified) source, but administrative review or
appeal of such approval or permit has not been exhausted. A
subsequent modification of any such approval or permits,
ongoing administrative or court review, appeals, or challenges,
or the existence or tolling of any time to pursue further
review, appeals, or challenges shall not affect the date on
which a covered EGU is considered to be initially permitted
under this paragraph.
``(b) Standards.--(1) A covered EGU that is initially permitted on
or after January 1, 2020, shall achieve an emission limit that is a 65
percent reduction in emissions of the carbon dioxide produced by the
unit, as measured on an annual basis, or meet such more stringent
standard as the Administrator may establish pursuant to subsection (c).
``(2) A covered EGU that is initially permitted after January 1,
2009, and before January 1, 2020, shall, by the applicable compliance
date established under this paragraph, achieve an emission limit that
is a 50 percent reduction in emissions of the carbon dioxide produced
by the unit, as measured on an annual basis. Compliance with the
requirement set forth in this paragraph shall be required by the
earliest of the following:
``(A) Four years after the date the Administrator has
published pursuant to subsection (d) a report that there are in
commercial operation in the United States electric generating
units or other stationary sources equipped with carbon capture
and sequestration technology that, in the aggregate--
``(i) have a total of at least 4 gigawatts of
nameplate generating capacity of which--
``(I) at least 3 gigawatts must be electric
generating units; and
``(II) up to 1 gigawatt may be industrial
applications, for which capture and
sequestration of 3 million tons of carbon
dioxide per year on an aggregate annualized
basis shall be considered equivalent to 1
gigawatt;
``(ii) include at least 2 electric generating
units, each with a nameplate generating capacity of 250
megawatts or greater, that capture, inject, and
sequester carbon dioxide into geologic formations other
than oil and gas fields; and
``(iii) are capturing and sequestering in the
aggregate at least 12 million tons of carbon dioxide
per year, calculated on an aggregate annualized basis.
``(B) January 1, 2025.
``(3) If the deadline for compliance with paragraph (2) is January
1, 2025, the Administrator may extend the deadline for compliance by a
covered EGU by up to 18 months if the Administrator makes a
determination, based on a showing by the owner or operator of the unit,
that it will be technically infeasible for the unit to meet the
standard by the deadline. The owner or operator must submit a request
for such an extension by no later than January 1, 2022, and the
Administrator shall provide for public notice and comment on the
extension request.
``(c) Review and Revision of Standards.--Not later than 2025 and at
5-year intervals thereafter, the Administrator shall review the
standards for new covered EGUs under this section and shall, by rule,
reduce the maximum carbon dioxide emission rate for new covered EGUs to
a rate which reflects the degree of emission limitation achievable
through the application of the best system of emission reduction which
(taking into account the cost of achieving such reduction and any
nonair quality health and environmental impact and energy requirements)
the Administrator determines has been adequately demonstrated.
``(d) Reports.--Not later than the date 18 months after the date
of enactment of this title and semiannually thereafter, the
Administrator shall publish a report on the nameplate capacity of units
(determined pursuant to subsection (b)(2)(A)) in commercial operation
in the United States equipped with carbon capture and sequestration
technology, including the information described in subsection (b)(2)(A)
(including the cumulative generating capacity to which carbon capture
and sequestration retrofit projects meeting the criteria described in
section 786(b)(1)(A)(ii) and (b)(1)(A)(iv)(II) has been applied and the
quantities of carbon dioxide captured and sequestered by such
projects).
``(e) Regulations.--Not later than 2 years after the date of
enactment of this title, the Administrator shall promulgate regulations
to carry out the requirements of this section.''.
Subtitle C--Clean Transportation
SEC. 121. ELECTRIC VEHICLE INFRASTRUCTURE.
(a) Amendment of PURPA.--Section 111(d) of the Public Utility
Regulatory Policies Act of 1978 (16 U.S.C. 2621(d)) is amended by
adding at the end the following:
``(20) Plug-in electric drive vehicle infrastructure.--
``(A) Utility plan for infrastructure.--Each
electric utility shall develop a plan to support the
use of plug-in electric drive vehicles, including
heavy-duty hybrid electric vehicles. The plan may
provide for deployment of electrical charging stations
in public or private locations, including street
parking, parking garages, parking lots, homes, gas
stations, and highway rest stops. Any such plan may
also include--
``(i) battery exchange, fast charging
infrastructure and other services;
``(ii) triggers for infrastructure
deployment based upon market penetration of
plug-in electric drive vehicles; and
``(iii) such other elements as the State
determines necessary to support plug-in
electric drive vehicles.
Each plan under this paragraph shall provide for the
deployment of the charging infrastructure or other
infrastructure necessary to adequately support the use
of plug-in electric drive vehicles.
``(B) Support requirements.--Each State regulatory
authority (in the case of each electric utility for
which it has ratemaking authority) and each utility (in
the case of a nonregulated utility) shall--
``(i) require that charging infrastructure
deployed is interoperable with products of all
auto manufacturers to the extent possible; and
``(ii) consider adopting minimum
requirements for deployment of electrical
charging infrastructure and other appropriate
requirements necessary to support the use of
plug-in electric drive vehicles.
``(C) Cost recovery.--Each State regulatory
authority (in the case of each electric utility for
which it has ratemaking authority) and each utility (in
the case of a nonregulated utility) shall consider
whether, and to what extent, to allow cost recovery for
plans and implementation of plans.
``(D) Smart grid integration.--The State regulatory
authority (in the case of each electric utility for
which it has ratemaking authority) and each utility (in
the case of a nonregulated utility) shall, in
accordance with regulations issued by the Federal
Energy Regulatory Commission pursuant to section
1305(d) of the Energy Independence and Security Act of
2007--
``(i) establish any appropriate protocols
and standards for integrating plug-in electric
drive vehicles into an electrical distribution
system, including Smart Grid systems and
devices as described in title XIII of the
Energy Independence and Security Act of 2007;
``(ii) include, to the extent feasible, the
ability for each plug-in electric drive vehicle
to be identified individually and to be
associated with its owner's electric utility
account, regardless of the location that the
vehicle is plugged in, for purposes of
appropriate billing for any electricity
required to charge the vehicle's batteries as
well as any crediting for electricity provided
to the electric utility from the vehicle's
batteries; and
``(iii) review the determination made in
response to section 1252 of the Energy Policy
Act of 2005 in light of this section, including
whether time-of-use pricing should be employed
to enable the use of plug-in electric drive
vehicles to contribute to meeting peak-load and
ancillary service power needs.''.
(b) Compliance.--
(1) Time limitations.--Section 112(b) of the Public Utility
Regulatory Policies Act of 1978 (16 U.S.C. 2622(b)) is amended
by adding the following at the end thereof:
``(7)(A) Not later than 3 years after the date of enactment of this
paragraph, each State regulatory authority (with respect to each
electric utility for which it has ratemaking authority) and each
nonregulated utility shall commence the consideration referred to in
section 111, or set a hearing date for consideration, with respect to
the standard established by paragraph (20) of section 111(d).
``(B) Not later than 4 years after the date of enactment of the
this paragraph, each State regulatory authority (with respect to each
electric utility for which it has ratemaking authority), and each
nonregulated electric utility, shall complete the consideration, and
shall make the determination, referred to in section 111 with respect
to the standard established by paragraph (20) of section 111(d).''.
(2) Failure to comply.--Section 112(c) of the Public
Utility Regulatory Policies Act of 1978 (16 U.S.C. 2622(c)) is
amended by adding the following at the end: ``In the case of
the standards established by paragraph (20) of section 111(d),
the reference contained in this subsection to the date of
enactment of this Act shall be deemed to be a reference to the
date of enactment of such paragraph.''.
(3) Prior state actions.--Section 112(d) of the Public
Utility Regulatory Policies Act of 1978 (16 U.S.C. 2622(d)) is
amended by striking ``(19)'' and inserting ``(20)'' before ``of
section 111(d)''.
SEC. 122. LARGE-SCALE VEHICLE ELECTRIFICATION PROGRAM.
(a) Deployment Program.--The Secretary of Energy shall establish a
program to deploy and integrate plug-in electric drive vehicles into
the electricity grid in multiple regions. In carrying out the program,
the Secretary may provide financial assistance described under
subsection (d), consistent with the goals under subsection (b). The
Secretary shall select regions based upon applications for assistance
received pursuant to subsection (c).
(b) Goals.--The goals of the program established pursuant to
subsection (a) shall be--
(1) to demonstrate the viability of a vehicle-based
transportation system that is not overly dependent on petroleum
as a fuel and contributes to lower carbon emissions than a
system based on conventional vehicles;
(2) to facilitate the integration of advanced vehicle
technologies into electricity distribution areas to improve
system performance and reliability;
(3) to demonstrate the potential benefits of coordinated
investments in vehicle electrification on personal mobility and
a regional grid;
(4) to demonstrate protocols and standards that facilitate
vehicle integration into the grid; and
(5) to investigate differences in each region and
regulatory environment regarding best practices in implementing
vehicle electrification.
(c) Applications.--Any State, Indian tribe, or local government (or
group of State, Indian tribe, or local governments) may apply to the
Secretary of Energy for financial assistance in furthering the regional
deployment and integration into the electricity grid of plug-in
electric drive vehicles. Such applications may be jointly sponsored by
electric utilities, automobile manufacturers, technology providers, car
sharing companies or organizations, or other persons or entities.
(d) Use of Funds.--Pursuant to applications received under
subsection (c), the Secretary may make financial assistance available
to any applicant or joint sponsor of the application to be used for any
of the following:
(1) Assisting persons located in the regional deployment
area, including fleet owners, in the purchase of new plug-in
electric drive vehicles by offsetting in whole or in part the
incremental cost of such vehicles above the cost of comparable
conventionally fueled vehicles.
(2) Supporting the use of plug-in electric drive vehicles
by funding projects for the deployment of any of the following:
(A) Electrical charging infrastructure for plug-in
electric drive vehicles, including battery exchange,
fast charging infrastructure, and other services, in
public or private locations, including street parking,
parking garages, parking lots, homes, gas stations, and
highway rest stops.
(B) Smart Grid equipment and infrastructure, as
described in title XIII of the Energy Independence and
Security Act of 2007, to facilitate the charging and
integration of plug-in electric drive vehicles.
(3) Such other projects as the Secretary determines
appropriate to support the large-scale deployment of plug-in
electric drive vehicles in regional deployment areas.
(e) Program Requirements.--The Secretary, in consultation with the
Administrator and the Secretary of Transportation, shall determine
design elements and requirements of the program established pursuant to
subsection (a), including--
(1) the type of financial mechanism with which to provide
financial assistance;
(2) criteria for evaluating applications submitted under
subsection (c), including the anticipated ability to promote
deployment and market penetration of vehicles that are less
dependent on petroleum as a fuel source; and
(3) reporting requirements for entities that receive
financial assistance under this section, including a
comprehensive set of performance data characterizing the
results of the deployment program.
(f) Information Clearinghouse.--The Secretary shall, as part of the
program established pursuant to subsection (a), collect and make
available to the public information regarding the cost, performance,
and other technical data regarding the deployment and integration of
plug-in electric drive vehicles.
(g) Authorization.--There are authorized to be appropriated to
carry out this section such sums as may be necessary.
SEC. 123. PLUG-IN ELECTRIC DRIVE VEHICLE MANUFACTURING.
(a) Vehicle Manufacturing Assistance Program.--The Secretary of
Energy shall establish a program to provide financial assistance to
automobile manufacturers to facilitate the manufacture of plug-in
electric drive vehicles, as defined in section 131(a)(5) of the Energy
Independence and Security Act of 2007, that are developed and produced
in the United States.
(b) Financial Assistance.--The Secretary of Energy may provide
financial assistance to an automobile manufacturer under the program
established pursuant to subsection (a) for the reconstruction or
retooling of facilities for the manufacture of plug-in electric drive
vehicles or batteries for such vehicles that are developed and produced
in the United States.
(c) Coordination With Regional Deployment.--The Secretary may
provide financial assistance under subsection (b) in conjunction with
the award of financial assistance under the large scale vehicle
electrification program established pursuant to section 122 of this
Act.
(d) Program Requirements.--The Secretary shall determine design
elements and requirements of the program established pursuant to
subsection (a), including--
(1) the type of financial mechanism with which to provide
financial assistance;
(2) criteria, in addition to the criteria described under
subsection (e), for evaluating applications for financial
assistance; and
(3) reporting requirements for automobile manufacturers
that receive financial assistance under this section.
(e) Criteria.--In selecting recipients of financial assistance from
among applicant automobile manufacturers, the Secretary shall give
preference to proposals that--
(1) are most likely to be successful; and
(2) are located in local markets that have the greatest
need for the facility.
(f) Reports.--The Secretary shall annually submit to Congress a
report on the program established pursuant to this section.
(g) Authorization of Appropriations.--There are authorized to be
appropriated such sums as are necessary to carry out this section.
SEC. 124. INVESTMENT IN CLEAN VEHICLES.
(a) Definitions.--In this section:
(1) Advanced technology vehicles and qualifying
components.--The terms ``advanced technology vehicles'' and
``qualifying components'' shall have the definition of such
terms in section 136 of the Energy Independence and Security
Act of 2007, except that for purposes of this section, the
average base year as described in such section 136(a)(1)(C)
shall be the following:
(A) In each of the years 2012 through 2016, model
year 2009.
(B) In 2017, the Administrator shall,
notwithstanding such section 136(a)(1)(C), determine an
appropriate baseline based on technological and
economic feasibility.
(2) Plug-in electric drive vehicle.--The term ``plug-in
electric drive vehicle'' shall have the definition of such term
in section 131 of the Energy Independence and Security Act of
2007.
(b) Distribution of Allowances.--The Administrator shall, in
accordance with this section, distribute emission allowances allocated
pursuant to section 782(i) of the Clean Air Act not later than
September 30 of 2012 and each calendar year thereafter through 2025.
(c) Plug-in Electric Drive Vehicle Manufacturing and Deployment.--
(1) In general.--The Administrator shall, at the direction
of the Secretary of Energy, provide emission allowances
allocated pursuant to section 782(i) to applicants, joint
sponsors and automobile manufacturers pursuant to sections 122
and 123 of this Act.
(2) Annual amount.--In each of the years 2012 through 2017,
one-quarter of the portion of the emission allowances allocated
pursuant to section 782(i) of the Clean Air Act shall be
available to carry out paragraph (1) such that--
(A) one-eighth of the portion shall be available to
carry out section 122; and
(B) one-eighth of the portion shall be available to
carry out section 123.
(3) Preference.--In directing the provision of emission
allowances under this subsection to carry out section 122, the
Secretary shall give preference to applications under section
122(c) that are jointly sponsored by one or more automobile
manufacturers.
(4) Multi-year commitments.--The Administrator shall commit
to providing emission allowances to an applicant, joint
sponsor, or automobile manufacturer for up to five consecutive
years if--
(A) an application under section 122 or 123 of this
Act requests a multi-year commitment;
(B) such application meets the criteria for support
established by the Secretary of Energy under section
122 or 123 of this Act;
(C) the Administrator confirms to the Secretary
that emission allowances will be available for a multi-
year commitment;
(D) the Secretary of Energy determines that a
multi-year commitment for such application will advance
the goals of section 122 or 123; and
(E) the Secretary of Energy directs the
Administrator to make a multi-year commitment.
(5) Insufficient applications.--If, in any year, emission
allowances available under paragraph (2) cannot be provided
because of insufficient numbers of submitted applications that
meet the criteria for support established by the Secretary of
Energy under section 122 or 123 of this Act, the remaining
emission allowances shall be distributed according to
subsection (d).
(d) Advanced Technology Vehicles.--
(1) In general.--The Administrator shall, at the direction
of the Secretary of Energy, provide any emission allowances
allocated pursuant to section 782(i) of the Clean Air Act that
are not provided under subsection (c) to automobile
manufacturers and component suppliers to pay not more than 30
percent of the cost of--
(A) reequipping, expanding, or establishing a
manufacturing facility in the United States to
produce--
(i) qualifying advanced technology
vehicles; or
(ii) qualifying components; and
(B) engineering integration performed in the United
States of qualifying vehicles and qualifying
components.
(2) Preference.--In directing the provision of emission
allowances under this subsection during the years 2012 through
2017, the Secretary shall give preference to applications for
projects that save the maximum number of gallons of fuel.
SEC. 125. ADVANCED TECHNOLOGY VEHICLE MANUFACTURING INCENTIVE LOANS.
Section 136(d)(1) of the Energy Independence and Security Act of
2007 (42 U.S.C. 17013(d)(1)) is amended by striking ``$25,000,000,000''
and inserting ``$50,000,000,000''.
SEC. 126. DEFINITION OF RENEWABLE BIOMASS.
(a) In General.--Section 211(o)(1)(I) of the Clean Air Act (42
U.S.C. 7545(o)(1)(I)) is amended to read as follows:
``(I) Renewable biomass.--The term `renewable
biomass' means any of the following:
``(i) Materials, pre-commercial thinnings,
or removed invasive species from National
Forest System land and public lands (as defined
in section 103 of the Federal Land Policy and
Management Act of 1976 (43 U.S.C. 1702)),
including those that are byproducts of
preventive treatments (such as trees, wood,
brush, thinnings, chips, and slash), that are
removed as part of a federally recognized
timber sale, or that are removed to reduce
hazardous fuels, to reduce or contain disease
or insect infestation, or to restore ecosystem
health, and that are--
``(I) not from components of the
National Wilderness Preservation
System, Wilderness Study Areas,
Inventoried Roadless Areas, old growth
stands, late-successional stands
(except for dead, severely damaged, or
badly infested trees), components of
the National Landscape Conservation
System, National Monuments, National
Conservation Areas, Designated
Primitive Areas, or Wild and Scenic
Rivers corridors;
``(II) harvested in environmentally
sustainable quantities, as determined
by the appropriate Federal land
manager; and
``(III) harvested in accordance
with Federal and State law, and
applicable land management plans.
``(ii) Any organic matter that is available
on a renewable or recurring basis from non-
Federal land or land belonging to an Indian or
Indian tribe that is held in trust by the
United States or subject to a restriction
against alienation imposed by the United
States, including--
``(I) renewable plant material,
including--
``(aa) feed grains;
``(bb) other agricultural
commodities;
``(cc) other plants and
trees; and
``(dd) algae; and
``(II) waste material, including--
``(aa) crop residue;
``(bb) other vegetative
waste material (including wood
waste and wood residues);
``(cc) animal waste and
byproducts (including fats,
oils, greases, and manure);
``(dd) construction waste;
``(ee) food waste and yard
waste; and
``(ff) the non-fossil
biogenic portion of municipal
solid waste and construction,
demolition, and disaster
debris.
``(iii) Residues and byproducts from wood,
pulp, or paper products facilities.''.
(b) Reduction.--The last sentence of section 211(o)(7)(D) of the
Clean Air Act (42 U.S.C. 7545(o)(7)(D)) is amended to read as follows:
``For any calendar year in which the Administrator makes such a
reduction, the Administrator shall also reduce the applicable volume of
renewable fuel and advanced biofuels requirement established under
paragraph (2)(B) by the same volume.''.
SEC. 127. OPEN FUEL STANDARD.
(a) Findings.--The Congress finds that--
(1) the status of oil as a strategic commodity, which
derives from its domination of the transportation sector,
presents a clear and present danger to the United States;
(2) in a prior era, when salt was a strategic commodity,
salt mines conferred national power and wars were fought over
the control of such mines;
(3) technology, in the form of electricity and
refrigeration, decisively ended salt's monopoly of meat
preservation and greatly reduced its strategic importance;
(4) fuel competition and consumer choice would similarly
serve to end oil's monopoly in the transportation sector and
strip oil of its strategic status;
(5) the current closed fuel market has allowed a cartel of
petroleum exporting countries to inflate fuel prices,
effectively imposing a harmful tax on the economy of the United
States;
(6) much of the inflated petroleum revenues the oil cartel
earns at the expense of the people of the United States are
used for purposes antithetical to the interests of the United
States and its allies;
(7) alcohol fuels, including ethanol and methanol, could
potentially provide significant supplies of additional fuels
that could be produced in the United States and in many other
countries in the Western Hemisphere that are friendly to the
United States;
(8) alcohol fuels can only play a major role in securing
the energy independence of the United States if a substantial
portion of vehicles in the United States are capable of
operating on such fuels;
(9) it is not in the best interest of United States
consumers or the United States Government to be constrained to
depend solely upon petroleum resources for vehicle fuels if
alcohol fuels are potentially available;
(10) existing technology, in the form of flexible fuel
vehicles, allows internal combustion engine cars and trucks to
be produced at little or no additional cost, which are capable
of operating on conventional gasoline, alcohol fuels, or any
combination of such fuels, as availability or cost advantage
dictates, providing a platform on which fuels can compete;
(11) the necessary distribution system for such alcohol
fuels will not be developed in the United States until a
substantial fraction of the vehicles in the United States are
capable of operating on such fuels;
(12) the establishment of such a vehicle fleet and
distribution system would provide a large market that would
mobilize private resources to substantially advance the
technology and expand the production of alcohol fuels in the
United States and abroad;
(13) the United States has an urgent national security
interest to develop alcohol fuels technology, production, and
distribution systems as rapidly as possible;
(14) new cars sold in the United States that are equipped
with an internal combustion engine should allow for fuel
competition by being flexible fuel vehicles, and new diesel
cars should be capable of operating on biodiesel; and
(15) such an open fuel standard would help to protect the
United States economy from high and volatile oil prices and
from the threats caused by global instability, terrorism, and
natural disaster.
(b) Open Fuel Standard for Transportation.--(1) Chapter 329 of
title 49, United States Code, is amended by adding at the end the
following:
``Sec. 32920. Open fuel standard for transportation
``(a) Definitions.--In this section:
``(1) E85.--The term `E85' means a fuel mixture containing
85 percent ethanol and 15 percent gasoline by volume.
``(2) Flexible fuel automobile.--The term `flexible fuel
automobile' means an automobile that has been warranted by its
manufacturer to operate on gasoline, E85, and M85.
``(3) Fuel choice-enabling automobile.--The term `fuel
choice-enabling automobile' means--
``(A) a flexible fuel automobile; or
``(B) an automobile that has been warranted by its
manufacturer to operate on biodiesel.
``(4) Light-duty automobile.--The term `light-duty
automobile' means--
``(A) a passenger automobile; or
``(B) a non-passenger automobile.
``(5) Light-duty automobile manufacturer's annual covered
inventory.--The term `light-duty automobile manufacturer's
annual covered inventory' means the number of light-duty
automobiles powered by an internal combustion engine that a
manufacturer, during a given calendar year, manufactures in the
United States or imports from outside of the United States for
sale in the United States.
``(6) M85.--The term `M85' means a fuel mixture containing
85 percent methanol and 15 percent gasoline by volume.
``(b) Open Fuel Standard for Transportation.--
``(1) In general.--The Secretary may promulgate regulations
to require each light-duty automobile manufacturer's annual
covered inventory to be comprised of a minimum percentage of
fuel-choice enabling automobiles, with sufficient lead time, if
the Secretary, in coordination with the Secretary of Energy and
the Administrator of the Environmental Protection Agency,
determines such requirement is a cost-effective way to achieve
the Nation's energy independence and environmental objectives.
The cost-effective determination shall consider the future
availability of both alternative fuel supply and infrastructure
to deliver the alternative fuel to the fuel-choice enabling
vehicles.
``(2) Temporary exemption from requirements.--
``(A) Application.--A manufacturer may request an
exemption from the requirement described in paragraph
(1) by submitting an application to the Secretary, at
such time, in such manner, and containing such
information as the Secretary may require by regulation.
Each such application shall specify the models, lines,
and types of automobiles affected.
``(B) Evaluation.--After evaluating an application
received from a manufacturer, the Secretary may at any
time, under such terms and conditions, and to such
extent as the Secretary considers appropriate,
temporarily exempt, or renew the exemption of, a light-
duty automobile from the requirement described in
paragraph (1) if the Secretary determines that
unavoidable events not under the control of the
manufacturer prevent the manufacturer of such
automobile from meeting its required production volume
of fuel choice-enabling automobiles, including--
``(i) a disruption in the supply of any
component required for compliance with the
regulations;
``(ii) a disruption in the use and
installation by the manufacturer of such
component; or
``(iii) application to plug-in electric
drive vehicles causing such vehicles to fail to
meet State air quality requirements.
``(C) Consolidation.--The Secretary may consolidate
applications received from multiple manufacturers under
subparagraph (A) if they are of a similar nature.
``(D) Conditions.--Any exemption granted under
subparagraph (B) shall be conditioned upon the
manufacturer's commitment to recall the exempted
automobiles for installation of the omitted components
within a reasonable time proposed by the manufacturer
and approved by the Secretary after such components
become available in sufficient quantities to satisfy
both anticipated production and recall volume
requirements.
``(E) Notice.--The Secretary shall publish in the
Federal Register--
``(i) notice of each application received
from a manufacturer;
``(ii) notice of each decision to grant or
deny a temporary exemption; and
``(iii) the reasons for granting or denying
such exemptions.''.
(2) The table of contents in chapter 329 of such title is amended
adding at the end the following:
``32920. Open fuel standard for transportation.''.
SEC. 128. DIESEL EMISSIONS REDUCTION.
Subtitle G of title VII of the Energy Policy Act of 2005 (42 U.S.C.
16131 et seq.) is amended--
(1) in the matter preceding clause (i) in section
791(3)(B), by inserting ``in any State'' after ``nonprofit
organization or institution'';
(2) in section 791(9), by striking ``The term `State'
includes the District of Columbia.'' and inserting ``The term
`State' includes the District of Columbia, American Samoa,
Guam, the Commonwealth of the Northern Mariana Islands, Puerto
Rico, and the Virgin Islands.'';
(3) in section 793(c)--
(A) in paragraph (2)(A), by striking ``51 States''
and inserting ``56 States'';
(B) in paragraph (2)(A), by striking ``1.96
percent'' and inserting ``1.785 percent'';
(C) in paragraph (2)(B), by striking ``51 States''
and inserting ``56 States''; and
(D) in paragraph (2)(B), by amending clause (ii) to
read as follows:
``(ii) the amount of funds remaining after
each State described in paragraph (1) receives
the 1.785-percent allocation under this
paragraph.''; and
(4) in section 797, by striking ``2011'' and inserting
``2016''.
SEC. 129. LOAN GUARANTEES FOR PROJECTS TO CONSTRUCT RENEWABLE FUEL
PIPELINES.
(a) Definitions.--Section 1701 of the Energy Policy Act of 2005 (42
U.S.C. 16511) is amended by adding at the end the following:
``(6) Renewable fuel.--The term `renewable fuel' has the
meaning given the term in section 211(o)(1) of the Clean Air
Act (42 U.S.C. 7545(o)(1)), except that the term shall include
all ethanol and biodiesel.
``(7) Renewable fuel pipeline.--The term `renewable fuel
pipeline' means a common carrier pipeline for transporting
renewable fuel.''.
(b) Renewable Fuel Pipeline Eligibility.--Section 1703(b) the
Energy Policy Act of 2005 (42 U.S.C. 16513) is amended by adding at the
end the following:
``(11) Renewable fuel pipelines.''.
SEC. 130. FLEET VEHICLES.
Section 508 of the Energy Policy Act of 1992 (42 U.S.C. 13258) is
amended as follows:
(1) By adding the following new paragraph at the end of
subsection (a):
``(6) Repowered or converted alternative fueled vehicles.--
As used in this paragraph, the term `repowered or converted
alternative fueled vehicle' includes light-, medium- or heavy-
duty motor vehicles that have been modified with an EPA or CARB
compliant engine or vehicle or aftermarket system so that the
vehicle or engine is capable of operating on an alternative
fuel.''.
(2) By adding the following new paragraph at the end of
subsection (b):
``(3) Repowered or converted vehicles. Not later than
January 1, 2010, the Secretary shall allocate credits to fleets
that repower or convert an existing vehicle so that it is
capable of operating on an alternative fuel. In the case of any
medium- or heavy-duty vehicle that is repowered or converted so
that it is capable of operating on an alternative fuel, the
Secretary shall allocate additional credits for such vehicles
if he determines that such vehicles displace more petroleum
than light duty alternative fueled vehicles. Such rules shall
also include a requirement that such vehicles remain in the
fleet for a period of no less than 2 years in order to continue
to qualify for credit. The Secretary also shall extend the
flexibility afforded in this paragraph to Federal fleets
subject to the purchase provisions contained in section 303 of
this Act.''.
SEC. 130A. REPORT ON NATURAL GAS VEHICLE EMISSIONS REDUCTIONS.
Within 360 days after the date of enactment of this Act, the
Administrator, in consultation with the Secretaries of Energy and
Transportation, and the Administrator of the General Services
Administration, and after an examination of available scientific
studies or analysis, shall submit to the Congress a report on--
(1) the contribution that light and heavy duty natural gas
vehicles, by category and State, have made during the last
decade to the reduction of greenhouse gases and criteria
pollutants under the Clean Air Act, and the reduced consumption
of petroleum-based fuels;
(2) the contribution that light and heavy duty natural gas
vehicles are expected to make from 2010 to 2020 in reducing
greenhouse gas and criteria pollutants under the Clean Air Act
based, among other things, on additional Federal incentives for
the manufacture and deployment of natural gas vehicles provided
in this Act, and other Federal legislation; and
(3) additional Federal measures, including legislation,
that could, if implemented, maximize the potential for natural
gas used in both stationary and mobile sources to contribute to
the reduction of greenhouse gases and criteria pollutants under
the Clean Air Act.
Subtitle D--State Energy and Environment Development Accounts
SEC. 131. ESTABLISHMENT OF SEED ACCOUNTS.
(a) Definitions.--In this section:
(1) SEED account.--The term ``SEED Account'' means a State
Energy and Environment Development Account established pursuant
to this section.
(2) State energy office.--The term ``State Energy Office''
means a State entity eligible for grants under part D of title
III of the Energy Policy and Conservation Act (42 U.S.C. 6321
et seq.).
(b) Establishment of Program.--The Administrator shall establish a
program under which a State, through its State Energy Office or other
State agency designated by the State, may operate a State Energy and
Environment Development Account.
(c) Purpose.--The purpose of each SEED Account is to serve as a
common State-level repository for managing and accounting for emission
allowances provided to States designated for renewable energy and
energy efficiency purposes.
(d) Regulations.--Not later than 1 year after the date of enactment
of this Act, the Administrator shall promulgate regulations to carry
out this section, including regulations--
(1) to ensure that each State operates its SEED Account and
any subaccounts thereof efficiently and in accordance with this
Act and applicable State and Federal laws;
(2) to prevent waste, fraud, and abuse;
(3) to indicate the emission allowances that may be
deposited in a State's SEED Account pending distribution or
use;
(4) to indicate the programs and objectives authorized by
Federal law for which emission allowances in a SEED Account may
be distributed or used;
(5) to identify the forms of financial assistance and
incentives that States may provide through distribution or use
of SEED Accounts; and
(6) to prescribe the form and content of reports that the
States are required to submit under this section on the use of
SEED Accounts.
(e) Operation.--
(1) Deposits.--
(A) In general.--In the allowance tracking system
established pursuant to section 724(d) of the Clean Air
Act, the Administrator shall establish a SEED Account
for each State and place in it the allowances allocated
pursuant to section 782(g) of the Clean Air Act to be
distributed to States pursuant to sections 132 and 201
of this Act.
(B) Financial account.--A State may create a
financial account associated with its SEED Account to
deposit, retain, and manage any proceeds of any sale of
any allowance provided pursuant to this Act pending
expenditure or disbursement of those proceeds for
purposes permitted under this section. The funds in
such an account shall not be commingled with other
funds not derived from the sale of allowances provided
to the State; however, loans made by the State from
such funds pursuant to paragraph (2)(C)(i) may be
repaid into such a financial account, including any
interest charged.
(2) Withdrawals.--
(A) In general.--All allowances distributed
pursuant to sections 132 and 201, including the
proceeds of any sale of such allowances, shall support
renewable energy and energy efficiency programs
authorized or approved by the Federal Government.
(B) Dedicated allowances.--Allowances distributed
pursuant to sections 132 and 201 that are required by
law to be used for specific purposes for a specified
period shall be used according to those requirements
during that period.
(C) Undedicated allowances.--To the extent that
allowances distributed pursuant to sections 132 and 201
are not required by law to be used for specific
purposes for a specified period as described in
subparagraph (B), such allowances or the proceeds of
their sale may be used for any of the following
purposes:
(i) Loans.--Loans of allowances, or the
proceeds from the sale of allowances, may be
provided, interest on commercial loans may be
subsidized at an interest rate as low as zero,
and other credit support may be provided to
support programs authorized to use SEED Account
allowance value or any other renewable energy
or energy efficiency purpose authorized or
approved by the Federal Government.
(ii) Grants.--Grants of allowances or the
proceeds of their sale may be provided to
support programs authorized to use SEED Account
allowance value or any other renewable energy
or energy efficiency purpose authorized or
approved by the Federal Government.
(iii) Other forms of support.--Allowances
or the proceeds of the sale of allowances may
be provided for other forms of support for
programs authorized to use SEED Account
allowance value or any other renewable energy
or energy efficiency purpose authorized or
approved by the Federal Government.
(iv) Administrative costs.--Except to the
extent provided in Federal law authorizing or
allocating allowances deposited in a SEED
Account, not more than 5 percent of the
allowance value in a SEED Account in any year
may be used to cover administrative expenses of
the SEED Account.
(D) Subaccounts.--A State may request that the
Administrator establish accounts for local governments
that request such subaccounts to hold allowances
distributed to local governments for renewable energy
or energy efficiency programs authorized or approved by
the Federal Government.
(E) Intended use plans.--
(i) In general.--After providing for public
review and comment, each State administering a
SEED Account shall annually prepare a plan that
identifies the intended uses of the allowances
or proceeds from the sale of allowances in its
SEED Account.
(ii) Contents.--An intended use plan shall
include--
(I) a list of the projects or
programs for which withdrawals from the
SEED Account are intended in the next
fiscal year that begins after the date
of the plan, including a description of
each project;
(II) the relationship of each of
the projects or programs to an
identified Federal purpose authorized
by this Act, or any other Federal
statute;
(III) the expected terms of use of
allowance value to provide assistance;
(IV) the criteria and methods
established for the distribution of
allowances or allowance value;
(V) a description of the equivalent
financial value and status of the SEED
Account; and
(VI) a statement of the mid-term
and long-term goals of the State for
use of its SEED Account.
(3) Accountability and transparency.--
(A) Controls and procedures.--Any State that has a
SEED Account shall establish fiscal controls and
recordkeeping and accounting procedures for the SEED
Account sufficient to ensure proper accounting during
appropriate accounting periods for distributions into
the SEED Account, transfers from the SEED Account, and
SEED Account balances, including any related financial
accounts. Such controls and procedures shall conform to
generally accepted government accounting principles.
Any State that has a SEED Account shall retain records
for a period of at least 5 years.
(B) Audits.--Any State that has a SEED Account
shall have an annual audit conducted of the SEED
Account by an independent public accountant in
accordance with generally accepted auditing standards,
and shall transmit the results of that audit to the
Administrator.
(C) State report.--Each State administering a SEED
Account shall make publicly available and submit to the
Administrator a report every 2 years on its activities
related to its SEED Account.
(D) Public information.--Any--
(i) controls and procedures established
under subparagraph (A); and
(ii) information obtained through audits
conducted under subparagraph (B), except to the
extent that it would be protected from
disclosure, if it were information held by the
Federal Government, under section 552(b) of
title 5, United States Code,
shall be made publicly available.
(E) Other protections.--The Administrator shall
require such additional procedures and protections as
are necessary to ensure that any State that has a SEED
Account will operate the SEED Account in an accountable
and transparent manner.
(f) Requirements for Eligibility.--A State's eligibility to receive
allowances in its SEED Account shall depend on that State's compliance
with the requirements of this Act (and the amendments made by this
Act).
(g) Authorization of Appropriations.--There are authorized to be
appropriated to the Administrator such sums as may be necessary for
SEED Account operations.
SEC. 132. SUPPORT OF STATE RENEWABLE ENERGY AND ENERGY EFFICIENCY
PROGRAMS.
(a) Definitions.--For purposes of this section:
(1) Allowance.--The term ``allowance'' means an emission
allowance established under section 721 of the Clean Air Act
(as added by section 311 of this Act).
(2) Cost-effective.--The term ``cost-effective'', with
respect to an energy efficiency program, means that the program
meets the Total Resource Cost Test, which requires that the net
present value of economic benefits over the life of the program
or measure, including avoided supply and delivery costs and
deferred or avoided investments, is greater than the net
present value of the economic costs over the life of the
program, including program costs and incremental costs borne by
the energy consumer.
(3) Renewable energy resource.--The term ``renewable energy
resource'' shall have the meaning given that term in section
610 of the Public Utility Regulatory Policies Act of 1978 (as
added by section 101 of this Act).
(4) Vintage year.--The term ``vintage year'' shall the
meaning given that term in section 700 of the Clean Air Act (as
added by section 311 of this Act).
(b) Distribution Among States.--Not later than September 30 of each
calendar year from 2011 through 2049, the Administrator shall, in
accordance with this section, distribute allowances allocated pursuant
to section 782(g)(1) of the Clean Air Act (as added by section 311 of
this Act) for the following vintage year. The Administrator shall
distribute 0.5 percent of such allowances pursuant to section 133 of
this Act. The Administrator shall distribute the remaining allowances
to States for renewable energy and energy efficiency programs to be
deposited in and administered through the State Energy and Environment
Development (SEED) Accounts established pursuant to section 131. The
Administrator shall distribute allowances among the States under this
section each year in accordance with the following formula:
(1) One third of the allowances shall be divided equally
among the States.
(2) One third of the allowances shall be distributed
ratably among the States based on the population of each State,
as contained in the most recent reliable census data available
from the Bureau of the Census, Department of Commerce, for all
States at the time the Administrator calculates the formula for
distribution.
(3) One third of the allowances for shall be distributed
ratably among the States on the basis of the energy consumption
of each State as contained in the most recent State Energy Data
Report available from the Energy Information Administration (or
such alternative reliable source as the Administrator may
designate).
(c) Uses.--The allowances distributed to each State pursuant to
this section shall be used exclusively in accordance with the following
requirements:
(1) Not less than 12.5 percent shall be distributed by the
State to units of local government within such State to be used
exclusively to support the energy efficiency and renewable
energy purposes listed in paragraphs (2) and (3).
(2) Not less than 20 percent shall be used exclusively for
the following energy efficiency purposes, provided that not
less than 1 percent shall be used for the purpose described in
subparagraph (D) and not less than 5.5 percent shall be used
for the purpose described in subparagraph (E):
(A) Implementation and enforcement of building
codes adopted in compliance with section 201.
(B) Implementation of the energy efficient
manufactured homes program established pursuant to
section 203.
(C) Implementation of the building energy
performance labeling program established pursuant to
section 204.
(D) Low-income community energy efficiency programs
that are consistent with the grant program established
under section 264 of this Act.
(E) Implementation of the Retrofit for Energy and
Environmental Performance (REEP) program established
pursuant to section 202.
(3) Not less than 20 percent shall be used exclusively for
capital grants, tax credits, production incentives, loans, loan
guarantees, forgivable loans, direct provision of allowances,
and interest rate buy-downs for--
(A) re-equipping, expanding, or establishing a
manufacturing facility that receives certification from
the Secretary of Energy pursuant to section 1302 of the
American Recovery and Reinvestment Act of 2009 for the
production of--
(i) property designed to be used to produce
energy from renewable energy sources; and
(ii) electricity storage systems;
(B) deployment of technologies to generate
electricity from renewable energy sources; and
(C) deployment of facilities or equipment, such as
solar panels, to generate electricity or thermal energy
from renewable energy resources in and on buildings in
an urban environment.
(4) The remaining 47.5 percent shall be used exclusively
for any of the following purposes:
(A) Energy efficiency purposes described in
paragraph (2).
(B) Renewable energy purposes described in
paragraph (3)(B) and (C).
(C) Cost-effective energy efficiency programs for
end-use consumers of electricity, natural gas, home
heating oil, or propane, including, where appropriate,
programs or mechanisms administered by local
governments and entities other than the State.
(D) Enabling the development of a Smart Grid (as
described in section 1301 of the Energy Independence
and Security Act of 2007 (42 U.S.C. 17381)) for State,
local government, and other public buildings and
facilities, including integration of renewable energy
resources and distributed generation, demand response,
demand side management, and systems analysis.
(E) Providing the non-Federal share of support for
surface transportation capital projects under--
(i) sections 5307, 5308, 5309, 5310, 5311
and 5319 of title 49, United States Code; and
(ii) sections 142, 146, and 149 of title
23, United States Code,
provided that not more than 10 percent of allowances
distributed to each State pursuant to this section
shall be used for such purpose.
(5) For any allowances used for the purpose described in
paragraph (4)(C), the State shall--
(A) prioritize expansion of existing energy
efficiency programs approved and overseen by the State
or the appropriate State regulatory authority; and
(B) demonstrate that such allowances have been used
to supplement, and not to supplant, existing and
otherwise available State, local, and ratepayer funding
for such purpose.
(d) Reporting.--Each State receiving allowances under this section
shall include in its biennial reports required under section 131, in
accordance with such requirements as the Administrator may prescribe--
(1) a list of entities receiving allowances or allowance
value under this section, including entities receiving such
allowances or allowance value from units of local government
pursuant to subsection (c)(1);
(2) the amount and nature of allowances or allowance value
received by each such recipient;
(3) the specific purposes for which such allowances or
allowance value was conveyed to each such recipient;
(4) documentation of the amount of energy savings, emission
reductions, renewable energy deployment, and new or retooled
manufacturing capacity resulting from the use of such
allowances or allowance value; and
(5) for any energy efficiency program supported under
subsection (c)(4)(C)--
(A) an assessment demonstrating the cost-
effectiveness of such program; and
(B) a demonstration that the requirements set forth
in subsection (c)(5) have been satisfied.
(e) Enforcement.--If the Administrator determines that a State is
not in compliance with this section, the Administrator may withhold up
to twice the number of allowances that the State failed to use in
accordance with the requirements of this section, that such State would
otherwise be eligible to receive under this section in later years.
Allowances withheld pursuant to this subsection shall be distributed
among the remaining States in accordance with the requirements of
subsection (b).
SEC. 133. SUPPORT OF INDIAN RENEWABLE ENERGY AND ENERGY EFFICIENCY
PROGRAMS.
(a) Definitions.--For purposes of this section:
(1) Allowance; cost-effective; renewable energy resource.--
The terms ``allowance'', ``cost-effective'', and ``renewable
energy resource'' have the meaning given those terms in section
132 of this Act.
(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) Secretary.--The term ``Secretary'' means the Secretary
of Energy.
(b) Establishment.--Not later than 18 months after the date of
enactment of this Act, the Secretary shall, in consultation with the
Administrator and the Secretary of the Interior, promulgate regulations
establishing a program to distribute allowances to Indian tribes on a
competitive basis for the following purposes:
(1) Energy efficiency.--Cost-effective energy efficiency
programs for end-use consumers of electricity, natural gas,
home heating oil, or propane.
(2) Renewable energy.--Deployment of technologies to
generate electricity from renewable energy resources.
(c) Requirements.--The regulations promulgated pursuant to
subsection (b) shall prescribe design elements and requirements of the
program established under this section, including--
(1) objective criteria for evaluating proposals submitted
by Indian tribes, and for selecting projects and programs to
receive support, under this section;
(2) reporting requirements for Indian tribes that receive
allowances under this section; and
(3) other appropriate elements and requirements.
(d) Distribution.--The Administrator shall, at the direction of the
Secretary, distribute to Indian tribes allowances that are set aside,
pursuant to section 132, for use under this section.
Subtitle E--Smart Grid Advancement
SEC. 141. DEFINITIONS.
For purposes of this subtitle:
(1) The term ``applicable baseline'' means the average of
the highest three annual peak demands a load-serving entity has
experienced during the 5 years immediately prior to the date of
enactment of this Act.
(2) The term ``Commission'' means Federal Energy Regulatory
Commission.
(3) The term ``load-serving entity'' means an entity that
provides electricity directly to retail consumers with the
responsibility to assure power quality and reliability,
including such entities that are investor-owned, publicly
owned, owned by rural electric cooperatives, or other entities.
(4) The term ``peak demand'' means the highest point of
electricity demand, net of any distributed electricity
generation or storage from sources on the load-serving entity's
customers' premises, during any hour on the system of a load
serving entity during a calendar year, expressed in Megawatts
(MW), or more than one such high point as a function of
seasonal demand changes.
(5) The term ``peak demand reduction'' means the reduction
in annual peak demand as compared to a previous baseline year
or period, expressed in Megawatts (MW), whether accomplished
by--
(A) diminishing the end-use requirements for
electricity;
(B) use of locally stored energy or generated
electricity to meet those requirements from distributed
resources on the load-serving entity's customers'
premises and without use of high-voltage transmission;
or
(C) energy savings from efficient operation of the
distribution grid resulting from the use of a Smart
Grid.
(6) The term ``peak demand reduction plan'' means a plan
developed by or for a load-serving entity that it will
implement to meet its peak demand reduction goals.
(7) The term ``peak period'' means the time period on the
system of a load-serving entity relative to peak demand that
may warrant special measures or electricity resources to
maintain system reliability while meeting peak demand.
(8) The term ``Secretary'' means the Secretary of Energy.
(9) The term ``Smart Grid'' has the meaning provided by
section 1301 of the Energy Independence and Security Act of
2007 (15 U.S.C. 17381).
SEC. 142. ASSESSMENT OF SMART GRID COST EFFECTIVENESS IN PRODUCTS.
(a) Assessment.--Within 1 year after the date of enactment of this
Act, the Secretary and the Administrator shall each assess the
potential for cost-effective integration of Smart Grid technologies and
capabilities in all products that are reviewed by the Department of
Energy and the Environmental Protection Agency, respectively, for
potential designation as Energy Star products.
(b) Analysis.--(1) Within 2 years after the date of enactment of
this Act, the Secretary and the Administrator shall each prepare an
analysis of the potential energy savings, greenhouse gas emission
reductions, and electricity cost savings that could accrue for each of
the products identified by the assessment in subsection (a) in the
following optimal circumstances:
(A) The products possessed Smart Grid capability and
interoperability that is tested and proven reliable.
(B) The products were utilized in an electricity utility
service area which had Smart Grid capability and offered
customers rate or program incentives to use the products.
(C) The utility's rates reflected national average costs,
including average peak and valley seasonal and daily
electricity costs.
(D) Consumers using such products took full advantage of
such capability.
(E) The utility avoided incremental investments and rate
increases related to such savings.
(2) The analysis under paragraph (1) shall be considered the ``best
case'' Smart Grid analysis. On the basis of such an analysis for each
product, the Secretary and the Administrator shall determine whether
the installation of Smart Grid capability for such a product would be
cost effective. For purposes of this paragraph, the term ``cost
effective'' means that the cumulative savings from using the product
under the best case Smart Grid circumstances for a period of one-half
of the product's expected useful life will be greater than the
incremental cost of the Smart Grid features included in the product.
(3) To the extent that including Smart Grid capability in any
products analyzed under paragraph (2) is found to be cost effective in
the best case, the Secretary and the Administrator shall, not later
than 3 years after the date of enactment of this Act take each of the
following actions:
(A) Inform the manufacturer of such product of such finding
of cost effectiveness.
(B) Assess the potential contributions the development and
use of products with Smart Grid technologies bring to reducing
peak demand and promoting grid stability.
(C) Assess the potential national energy savings and
electricity cost savings that could be realized if Smart Grid
potential were installed in the relevant products reviewed by
the Energy Star program.
(D) Assess and identify options for providing consumers
information on products with Smart Grid capabilities, including
the necessary conditions for cost-effective savings.
(E) Submit a report to Congress summarizing the results of
the assessment for each class of products, and presenting the
potential energy and greenhouse gas savings that could result
if Smart Grid capability were installed and utilized on such
products.
SEC. 143. INCLUSIONS OF SMART GRID CAPABILITY ON APPLIANCE ENERGY GUIDE
LABELS.
Section 324(a)(2) of the Energy Policy and Conservation Act (42
U.S.C. 6294(a)(2)) is amended by adding the following at the end:
``(J)(i) Not later than 1 year after the date of
enactment of this subparagraph, the Federal Trade
Commission shall initiate a rulemaking to consider
making a special note in a prominent manner on any
ENERGY GUIDE label for any product actually including
Smart Grid capability that--
``(I) Smart Grid capability is a feature of
that product;
``(II) the use and value of that feature
depended on the Smart Grid capability of the
utility system in which the product was
installed and the active utilization of that
feature by the customer; and
``(III) on a utility system with Smart Grid
capability, the use of the product's Smart Grid
capability could reduce the customer's cost of
the product's annual operation by an estimated
dollar amount range representing the result of
incremental energy and electricity cost savings
that would result from the customer taking full
advantage of such Smart Grid capability.
``(ii) Not later than 3 years after the date of
enactment of this subparagraph, the Commission shall
complete the rulemaking initiated under clause (i).''.
SEC. 144. SMART GRID PEAK DEMAND REDUCTION GOALS.
(a) Goals.--Not later than 1 year after the date of enactment of
this section, each load-serving entity, or, at the option of the State,
each State with respect to load-serving entities that the State
regulates, shall determine and publish peak demand reduction goals for
any load-serving entities that have an applicable baseline in excess of
250 megawatts.
(b) Baselines.--(1) The Commission, in consultation with the
Secretary and the Administrator, shall develop and publish, after an
opportunity for public comment, but not later than 180 days after
enactment of this section, a methodology to provide for adjustments or
normalization to a load-serving entity's applicable baseline over time
to reflect changes in the number of customers served, weather
conditions, general economic conditions, and any other appropriate
factors external to peak demand management, as determined by the
Commission.
(2) The Commission shall support load-serving entities (including
any load-serving entities with an applicable baseline of less than 250
megawatts that volunteer to participate in achieving the purposes of
this section) in determining their applicable baselines, and in
developing their peak demand reduction goals.
(3) The Secretary, in consultation with the Commission, the
Administrator, and the North American Electric Reliability Corporation,
shall develop a system and rules for measurement and verification of
demand reductions.
(c) Peak Demand Reduction Goals.--(1) Peak demand reduction goals
may be established for an individual load-serving entity, or, at the
determination of a State, tribal, or regional entity, by that State,
tribal, or regional entity for a larger region that shares a common
system peak demand and for which peak demand reduction measures would
offer regional benefit.
(2) A State or regional entity establishing peak demand reduction
goals shall cooperate, as necessary and appropriate, with the
Commission, the Secretary, State regulatory commissions, State energy
offices, the North American Electric Reliability Corporation, and other
relevant authorities.
(3) In determining the applicable peak demand reduction goals--
(A) States and other jurisdictional entities may utilize
the results of the 2009 National Demand Response Potential
Assessment, as authorized by section 571 of the National Energy
Conservation Policy Act (42 U.S.C. 8279); and
(B) the relative economics of peak demand reduction and
generation required to meet peak demand shall be evaluated in a
neutral and objective manner.
(4) The applicable peak demand reduction goals shall provide that--
(A) load-serving entities will reduce or mitigate peak
demand by a minimum percentage amount from the applicable
baseline to a lower peak demand during calendar year 2012;
(B) load-serving entities will reduce or mitigate peak
demand by a minimum percentage greater amount from the
applicable baseline to a lower peak demand during calendar year
2015; and
(C) the minimum percentage reductions established as peak
demand reduction goals shall be the maximum reductions that are
realistically achievable with an aggressive effort to deploy
Smart Grid and peak demand reduction technologies and methods,
including but not limited to those listed in subsection (d).
(d) Plan.--Each load-serving entity shall prepare a peak demand
reduction plan that demonstrates its ability to meet each applicable
goal by any or a combination of the following options:
(1) Direct reduction in megawatts of peak demand through--
(A) energy efficiency measures (including efficient
transmission wire technologies which significantly
reduce line loss compared to traditional wire
technology) with reliable and continued application
during peak demand periods; or
(B) use of a Smart Grid.
(2) Demonstration that an amount of megawatts equal to a
stated portion of the applicable goal is contractually
committed to be available for peak reduction through one or
more of the following:
(A) Megawatts enrolled in demand response programs.
(B) Megawatts subject to the ability of a load-
serving entity to call on demand response programs,
smart appliances, smart electricity or energy storage
devices, distributed generation resources on the
entity's customers' premises, or other measures
directly capable of actively, controllably, reliably,
and dynamically reducing peak demand (``dynamic peak
management control'').
(C) Megawatts available from distributed dynamic
electricity or energy storage under agreement with the
owner of that storage.
(D) Megawatts committed from dispatchable
distributed generation demonstrated to be reliable
under peak period conditions and in compliance with air
quality regulations.
(E) Megawatts available from smart appliances and
equipment with Smart Grid capability available for
direct control by the utility through agreement with
the customer owning the appliances or equipment or with
a third party pursuant to such agreements.
(F) Megawatts from a demonstrated and assured
minimum of distributed solar electric generation
capacity in instances where peak period and peak demand
conditions are directly related to solar radiation and
accompanying heat.
(3) If any of the methods listed in subparagraph (C), (D),
or (E) of paragraph (2) are relied upon to meet its peak demand
reduction goals, the load-serving entity must demonstrate this
capability by operating a test during the applicable calendar
year.
(4) Nothing in this section shall require the publication
in peak demand reduction goals or in any peak demand reduction
plan of any information that is confidential for competitive or
other reasons or that identifies individual customers.
(e) Existing Authority and Requirements.--Nothing in this section
diminishes or supersedes any authority of a State or political
subdivision of a State to adopt or enforce any law or regulation
respecting peak demand management, demand response, distributed energy
storage, use of distributed generation, or the regulation of load-
serving entities. The Commission, in consultation with States and
Indian tribes having such peak management, demand response and
distributed energy storage programs, shall to the maximum extent
practicable, facilitate coordination between the Federal program and
such State and tribal programs.
(f) Relief.--The Commission may, for good cause, grant relief to
load-serving entities from the requirements of this section.
(g) Other Laws.--Except as provided in subsections (e) and (f), no
law or regulation shall relieve any person of any requirement otherwise
applicable under this section.
(h) Compliance.--(1) The Commission shall within 1 year after the
date of enactment of this Act establish a public website where the
Commission will provide information and data demonstrating compliance
by States, Indian tribes regional entities, and load-serving entities
with this section, including the success of load-serving entities in
meeting applicable peak demand reduction goals.
(2) The Commission shall, by April 1 of each year beginning in
2012, provide a report to Congress on compliance with this section and
success in meeting applicable peak demand reduction goals and, as
appropriate, shall make recommendations as to how to increase peak
demand reduction efforts.
(3) The Commission shall note in each such report any State,
political subdivision of a State, or load-serving entity that has
failed to comply with this section, or is not a part of any region or
group of load-serving entities serving a region that has complied with
this section.
(4) The Commission shall have and exercise the authority to take
reasonable steps to modify the process of establishing peak demand
reduction goals and to accept adjustments to them as appropriate when
sought by load-serving entities.
(i) Assistance and Funding.--
(1) Assistance to states and tribes.--Any costs incurred by
States for activities undertaken pursuant to this section shall
be supported by the use of emission allowances allocated to the
States' SEED Accounts or to the tribes pursuant to section 132
of this Act. To the extent that a State provides allowances to
local governments within the State to implement this program,
that shall be deemed a distribution of such allowances to units
of local government pursuant to subsection (c)(1) of that
section.
(2) Funding.--There are authorized to be appropriated such
sums as may be necessary to the Commission, the Secretary, and
the Administrator to carry out the provisions of this section.
SEC. 145. REAUTHORIZATION OF ENERGY EFFICIENCY PUBLIC INFORMATION
PROGRAM TO INCLUDE SMART GRID INFORMATION.
(a) In General.--Section 134 of the Energy Policy Act of 2005 (42
U.S.C. 15832) is amended as follows:
(1) By amending the section heading to read as follows:
``energy efficiency and smart grid public information
initiative''.
(2) In paragraph (1) of subsection (a) by striking ``reduce
energy consumption during the 4-year period beginning on the
date of enactment of this Act'' and inserting ``increase energy
efficiency and to adopt Smart Grid technology and practices''.
(3) In paragraph (2) of subsection (a) by striking
``benefits to consumers of reducing'' and inserting ``economic
and environmental benefits to consumers and the United States
of optimizing''.
(4) In subsection (a) by inserting at the beginning of
paragraph (3) ``the effect of energy efficiency and Smart Grid
capability in reducing energy and electricity prices throughout
the economy, together with''.
(5) In subsection (a)(4) by redesignating subparagraph (D)
as (E), by striking ``and'' at the end of subparagraph (C), and
by inserting after subparagraph (C) the following:
``(D) purchasing and utilizing equipment that
includes Smart Grid features and capability; and''.
(6) In subsection (c), by striking ``Not later than July 1,
2009,'' and inserting, ``For each year when appropriations
pursuant to the authorization in this section exceed
$10,000,000,''.
(7) In subsection (d) by striking ``2010'' and inserting
``2020''.
(8) In subsection (e) by striking ``2010'' and inserting
``2020''.
(b) Table of Contents.--The item relating to section 134 in the
table of contents for the Energy Policy Act of 2005 (42 U.S.C. 15801
and following) is amended to read as follows:
``Sec. 134. Energy efficiency and Smart Grid public information
initiative.''.
SEC. 146. INCLUSION OF SMART GRID FEATURES IN APPLIANCE REBATE PROGRAM.
(a) Amendments.--Section 124 of the Energy Policy Act of 2005 (42
U.S.C. 15821) is amended as follows:
(1) By amending the section heading to read as follows:
``energy efficient and smart appliance rebate program.''.
(2) By redesignating paragraphs (4) and (5) of subsection
(a) as paragraphs (5) and (6), respectively, and inserting
after paragraph (3) the following:
``(4) Smart appliance.--The term `smart appliance' means a
product that the Administrator of the Environmental Protection
Agency or the Secretary of Energy has determined qualifies for
such a designation in the Energy Star program pursuant to
section 142 of the American Clean Energy and Security Act of
2009, or that the Secretary or the Administrator has separately
determined includes the relevant Smart Grid capabilities listed
in section 1301 of the Energy Independence and Security Act of
2007 (15 U.S.C. 17381).''.
(3) In subsection (b)(1) by inserting ``and smart'' after
``efficient'' and by inserting after ``products'' the first
place it appears ``, including products designated as being
smart appliances''.
(4) In subsection (b)(3), by inserting ``the administration
of'' after ``carry out''.
(5) In subsection (d), by inserting ``the administration
of'' after ``carrying out'' and by inserting ``, and up to 100
percent of the value of the rebates provided pursuant to this
section'' before the period at the end.
(6) In subsection (e)(3), by inserting ``, with separate
consideration as applicable if the product is also a smart
appliance,'' after ``Energy Star product'' the first place it
appears and by inserting ``or smart appliance'' before the
period at the end.
(7) In subsection (f), by striking ``$50,000,000'' through
the period at the end and inserting ``$100,000,000 for each
fiscal year from 2010 through 2015.''.
(b) Table of Contents.--The item relating to section 124 in the
table of contents for the Energy Policy Act of 2005 (42 U.S.C. 15801
and following) is amended to read as follows:
``Sec. 124. Energy efficient and smart appliance rebate program.''.
Subtitle F--Transmission Planning
SEC. 151. TRANSMISSION PLANNING AND SITING.
(a) In General.--Section 216 of the Federal Power Act (16 U.S.C.
824p) is amended as follows:
(1) In subsection (b), in paragraph (5), by striking ``;
and'' and inserting a semicolon, in paragraph (6) by striking
the period and inserting ``; and'' and by adding the following
at the end thereof:
``(7) the facility is interstate in nature or is an
intrastate segment integral to a proposed interstate
facility;''.
(2) In subsection (k), by inserting at the end the
following: ``Subsections (a), (b), (c), and (h) of this section
shall not apply in the Western interconnection.''.
(3) In subsections (d) and (e), by striking ``subsection
(b)'' in each place and inserting ``subsection (b) or section
216B'', and by striking ``permit'' and inserting ``permit or
certificate'' in each place it appears.
(b) New Sections.--The Federal Power Act (16 U.S.C. 824p) is
amended by inserting the following new sections after section 216:
``SEC. 216A. TRANSMISSION PLANNING.
``(a) Federal Policy for Transmission Planning.--
``(1) Objectives.--It is the policy of the United States
that regional electric grid planning should facilitate the
deployment of renewable and other zero-carbon and low-carbon
energy sources for generating electricity to reduce greenhouse
gas emissions while ensuring reliability, reducing congestion,
ensuring cyber-security, minimizing environmental harm, and
providing for cost-effective electricity services throughout
the United States, in addition to serving the objectives stated
in section 217(b)(4).
``(2) Options.--In addition to the policy under paragraph
(1), it is the policy of the United States that regional
electric grid planning to meet these objectives should result
from an open, inclusive and transparent process, taking into
account all significant demand-side and supply-side options,
including energy efficiency, distributed generation, renewable
energy and zero-carbon electricity generation technologies,
smart-grid technologies and practices, demand response,
electricity storage, voltage regulation technologies, high
capacity conductors with at least 25 percent greater efficiency
than traditional ACSR (aluminum stranded conductors steel
reinforced) conductors, superconductor technologies,
underground transmission technologies, and new conventional
electric transmission capacity and corridors.
``(b) Planning.--
``(1) Planning principles.--Not later than 1 year after the
date of enactment of this section, the Commission shall adopt,
after notice and opportunity for comment, national electricity
grid planning principles derived from the Federal policy
established under subsection (a) to be applied in ongoing and
future transmission planning that may implicate interstate
transmission of electricity.
``(2) Regional planning entities.--Not later than 3 months
after the date of adoption by the Commission of national
electricity grid planning principles pursuant to paragraph (1),
entities that conduct or may conduct transmission planning
pursuant to State, tribal, or Federal law or regulation,
including States, Indian tribes, entities designated by States
and Indian tribes, Federal Power Marketing Administrations,
transmission providers, operators and owners, regional
organizations, and electric utilities, and that are willing to
incorporate the national electricity grid planning principles
adopted by the Commission in their electric grid planning,
shall identify themselves and the regions for which they
propose to develop plans to the Commission.
``(3) Coordination of regional planning entities.--The
Commission shall encourage regional planning entities described
under paragraph (2) to cooperate and coordinate across regions
and to harmonize regional electric grid planning with planning
in adjacent or overlapping jurisdictions to the maximum extent
feasible. The Commission shall work with States, Indian tribes,
Federal land management agencies, State energy, environment,
natural resources, and land management agencies and
commissions, Federal power marketing administrations, electric
utilities, transmission providers, load-serving entities,
transmission operators, regional transmission organizations,
independent system operators, and other organizations to
resolve any conflict or competition among proposed planning
entities in order to build consensus and promote the Federal
policy established under subsection (a). The Commission shall
seek to ensure that planning that is consistent with the
national electricity grid planning principles adopted pursuant
to paragraph (1) is conducted in all regions of the United
States and the territories, but in a manner that, to the extent
feasible, avoids uncoordinated planning by more than one
planning entity for the same area.
``(4) Relation to existing planning policy.--In
implementing the Federal policy established under subsection
(a), the Commission shall--
``(A) incorporate and coordinate with any ongoing
planning efforts undertaken pursuant to section 217 and
Commission Order No. 890;
``(B) coordinate with the Secretary of Energy in
providing to the regional planning entities an annual
summary of national energy policy priorities and goals;
``(C) coordinate with corridor designation and
planning functions carried out pursuant to section 216
by the Secretary of Energy, who shall provide financial
support from available funds to support the purposes of
this section; and
``(D) coordinate with the Secretaries of the
Interior and Agriculture and Indian tribes in carrying
out the Secretaries' or tribal governments' existing
responsibilities for the planning or siting of
transmission facilities on Federal or tribal lands,
consistent with law, policy, and regulations relating
to the management of federal public lands.
``(5) Assistance.--
``(A) In general.--The Commission shall provide
support to and may participate if invited to do so in
the regional grid planning processes conducted by
regional planning entities. The Secretary of Energy and
the Commission may provide planning resources and
assistance as required or as requested by regional
planning entities, including system data, cost
information, system analysis, technical expertise,
modeling support, dispute resolution services, and
other assistance to regional planning entities, as
appropriate.
``(B) Authorization.--There are authorized to be
appropriated such sums as may be necessary to carry out
this paragraph.
``(6) Conflict resolution.--In the event that regional grid
plans conflict, the Commission shall assist the regional
planning entities in resolving such conflicts in order to
achieve the objectives of the Federal policy established under
subsection (a).
``(7) Submission of plans.--The Commission shall require
regional planning entities to submit initial regional electric
grid plans to the Commission not later than 18 months after the
date the Commission promulgates national electricity grid
planning principles pursuant to paragraph (1), with updates to
such plans not less than every 3 years thereafter. The
Commission shall review such plans for consistency with the
national grid planning principles and may return a plan to one
or more planning entities for further consideration, along with
the Commission's own recommendations for resolution of any
conflict or for improvement.
``(8) Integration of plans.--Regional electric grid plans
should, in general, be developed from sub-regional requirements
and plans, including planning input reflecting individual
utility service areas. Regional plans may then in turn be
combined into larger regional plans, up to interconnection-wide
and national plans, as appropriate and necessary as determined
by the Commission. In no case shall a multi-regional plan
impose inclusion of a facility on a region that has submitted a
valid plan that, after efforts to resolve the conflict, does
not include such facility. To the extent practicable, all plans
submitted to the Commission shall be public documents and
available on the Commission's Web site.
``(9) Multi-regional meetings.--As regional grid plans are
submitted to the Commission, the Commission may convene multi-
regional meetings to discuss regional grid plan consistency and
integration, including requirements for multi-regional
projects, and to resolve any conflicts that emerge from such
multi-regional projects. The Commission shall provide its
recommendations for eliminating any inter-regional conflicts.
``(10) Report to congress.--Not later than 3 years after
the date of enactment of this section and each 3 years
thereafter, the Commission shall provide a report to Congress
containing the results of the regional grid planning process,
including summaries of the adopted regional plans and the
extent to which the Federal policy objectives in subsection (a)
have been successfully achieved. The Commission shall provide
an electronic version of its report on its website with links
to all regional and sub-regional plans taken into account. The
Commission shall note and provide its recommended resolution
for any conflicts not resolved during the planning process. The
Commission shall make any recommendations to Congress on the
appropriate Federal role or support required to address the
needs of the electric grid, including recommendations for
addressing any needs that are beyond the reach of existing
State, tribal, and Federal authority.
``SEC. 216B. SITING AND CONSTRUCTION IN THE WESTERN INTERCONNECTION.
``(a) Applicability.--This section applies only to States located
in the Western Interconnection and does not apply to States located in
the Eastern Interconnection, to the States of Alaska or Hawaii, or to
ERCOT.
``(b) Certificate of Public Convenience and Necessity.--The
Commission may, after notice and opportunity for hearing, issue a
certificate of public convenience and necessity for the construction or
modification of a transmission facility if the Commission finds that--
``(1) the facility was identified and included in one or
more relevant and final regional or interconnection-wide
electric grid plans submitted to the Commission pursuant to
subsection (b) of 216A;
``(2) any conflict among regional electric grid plans
concerning the need for the facility was resolved;
``(3) such relevant regional electric grid plans are
consistent with the national grid planning principles adopted
by the Commission pursuant to subsection (b);
``(4) the facility was identified as needed in significant
measure to meet demand for renewable energy in such plans;
``(5) the facility is a multistate facility;
``(6) the developer of such facility filed a complete
application seeking approval for the siting of the facility
with a state commission or other entity that has authority to
approve the siting of the facility;
``(7) a State commission or other entity that has authority
to approve the siting of the facility--
``(A) did not issue a decision on an application
seeking approval for the siting of the facility within
1 year after the date the applicant submitted a
completed application to the State;
``(B) denied a complete application seeking
approval for the siting of the facility; or
``(C) authorized the siting of the facility subject
to conditions that unreasonably interfere with the
development of the facility; and
``(8) the siting of the facility can be accomplished in a
manner consistent with the Federal policy established in
subsection (a) of section 216A and the national grid planning
principles adopted by the Commission pursuant to subsection (b)
of section 216A.
``(c) State Recommendations on Resource Protection.--In issuing a
final certificate of public convenience and necessity pursuant to
subsection (b), the Commission shall--
``(1) consider any siting constraints and mitigation
measures based on habitat protection, health and safety
considerations, environmental considerations, or cultural site
protection identified by relevant State or local authorities;
and
``(2) incorporate those identified siting constraints or
mitigation measures, including recommendations related to
project routing, as conditions in the final certificate of
public convenience and necessity, or if the Commission
determines that a recommended siting constraint or mitigation
measure is infeasible, excessively costly, or inconsistent with
the Federal policy established in subsection (a) of section
216A or the national grid planning principles adopted by the
Commission pursuant to subsection (b) of section 216A--
``(A) consult with State regulatory agencies to
seek to resolve the issue;
``(B) incorporate as conditions on the certificate
such recommended siting constraints or mitigation
measures as are determined to be appropriate by the
Commission, based on consultation by the Commission
with State regulatory agencies, the Federal policy
established in subsection (a) of section 216A and the
national grid planning principles adopted by the
Commission pursuant to subsection (b)of section 216A,
and the record before the Commission; and
``(C) if, after consultation, the Commission does
not adopt in whole or in part a recommendation of an
agency, publish a finding that the adoption of the
recommendation is infeasible, not cost effective, or
inconsistent with this section or other applicable
provisions of law.
``(d) Certificate Applications.--(1) An application for a
preliminary or final certificate of public convenience and necessity
under this subsection shall be made in writing to the Commission.
``(2) The Commission shall issue rules specifying--
``(A) the form of the application;
``(B) the information to be contained in the application;
and
``(C) the manner of service of notice of the application on
interested persons.
``(e) Coordination of Federal Authorizations for Transmission
Facilities.--
``(1) In this subsection, the term `Federal authorization'
shall have the same meaning and include the same actions as in
section 216(h).
``(2) The Federal Energy Regulatory Commission shall act as
the lead agency for purposes of coordinating all applicable
Federal authorizations and related environmental reviews of the
facility, provided, however, that to the extent the facility is
proposed to be sited on Federal lands, the Department of the
Interior will assume such lead-agency duties as agreed between
the Commission and the Department of Interior.
``(3) To the maximum extent practicable under applicable
Federal law, the Commission, and to the extent agreed, the
Secretary of Interior, shall coordinate the Federal
authorization and review process under this subsection with any
Indian tribes, multistate entities, and State agencies that are
responsible for conducting any separate permitting and
environmental reviews of the facility, to ensure timely and
efficient review and permit decisions.
``(4)(A) As head of the lead agency, the Chairman of the
Commission, in consultation with the Secretary of Interior and
with those entities referred to in paragraph (3) that are
willing to coordinate their own separate permitting and
environmental reviews with the Federal authorization and
environmental reviews, shall establish prompt and binding
intermediate milestones and ultimate deadlines for the review
of, and Federal authorization decisions relating to, the
proposed facility.
``(B) The Chairman of the Commission, or the Secretary of
Interior, as agreed under paragraph (2), shall ensure that,
once an application has been submitted with such data as the
lead agency considers necessary, all permit decisions and
related environmental reviews under all applicable Federal laws
shall be completed--
``(i) within 1 year; or
``(ii) if a requirement of another provision of
Federal law does not permit compliance with clause (i),
as soon thereafter as is practicable.
``(C) The Commission shall provide an expeditious pre-
application mechanism for prospective applicants to confer with
the agencies involved to have each such agency determine and
communicate to the prospective applicant not later than 60 days
after the prospective applicant submits a request for such
information concerning--
``(i) the likelihood of approval for a potential
facility; and
``(ii) key issues of concern to the agencies and
public.
``(5)(A) As lead agency head, the Chairman of the
Commission, in consultation with the affected agencies, shall
prepare a single environmental review document, which shall be
used as the basis for all decisions on the proposed project
under Federal law.
``(B) The Chairman of the Commission and the heads of other
agencies shall streamline the review and permitting of
transmission within corridors designated under section 503 of
the Federal Land Policy and Management Act (43 U.S.C. 1763) by
fully taking into account prior analyses and decisions relating
to the corridors.
``(C) The document shall include consideration by the
relevant agencies of any applicable criteria or other matters
as required under applicable law.
``(6)(A) If any agency has denied a Federal authorization
required for a transmission facility, or has failed to act by
the deadline established by the Commission pursuant to this
section for deciding whether to issue the authorization, the
applicant or any State in which the facility would be located
may file an appeal with the President, who shall, in
consultation with the affected agency, review the denial or
failure to take action on the pending application.
``(B) Based on the overall record and in consultation with
the affected agency, the President may--
``(i) issue the necessary authorization with any
appropriate conditions; or
``(ii) deny the application.
``(C) The President shall issue a decision not later than
90 days after the date of the filing of the appeal.
``(D) In making a decision under this paragraph, the
President shall comply with applicable requirements of Federal
law, including any requirements of--
``(i) the National Forest Management Act of 1976
(16 U.S.C. 472a et seq.);
``(ii) the Endangered Species Act of 1973 (16
U.S.C. 1531 et seq.);
``(iii) the Federal Water Pollution Control Act (33
U.S.C. 1251 et seq.);
``(iv) the National Environmental Policy Act of
1969 (42 U.S.C. 4321 et seq.); and
``(v) the Federal Land Policy and Management Act of
1976 (43 U.S.C. 1701 et seq.).
``(7)(A) Not later than 18 months after August 8, 2005, the
Commission or, as requested, the Secretary or Interior, shall
issue any regulations necessary to implement this subsection.
``(B)(i) Not later than 1 year after August 8, 2005, the
Commission, the Secretary of Interior, and the heads of all
Federal agencies with authority to issue Federal authorizations
shall enter into a memorandum of understanding to ensure the
timely and coordinated review and permitting of electricity
transmission facilities.
``(ii) Interested Indian tribes, multistate entities, and
State agencies may enter the memorandum of understanding.
``(C) The head of each Federal agency with authority to
issue a Federal authorization shall designate a senior official
responsible for, and dedicate sufficient other staff and
resources to ensure, full implementation of the regulations and
memorandum required under this paragraph.
``(8)(A) Each Federal land use authorization for an
electricity transmission facility shall be issued--
``(i) for a duration, as determined by the
Secretary of Interior, commensurate with the
anticipated use of the facility; and
``(ii) with appropriate authority to manage the
right-of-way for reliability and environmental
protection.
``(B) On the expiration of the authorization (including an
authorization issued before August 8, 2005), the authorization
shall be reviewed for renewal taking fully into account
reliance on such electricity infrastructure, recognizing the
importance of the authorization for public health, safety, and
economic welfare and as a legitimate use of Federal land.
``(9) In exercising the responsibilities under this
section, the Commission shall consult regularly with--
``(A) electric reliability organizations (including
related regional entities) approved by the Commission;
and
``(B) Transmission Organizations approved by the
Commission.''.
SEC. 152. NET METERING FOR FEDERAL AGENCIES.
(a) Standard.--Subsection (b) of section 113 of the Public Utility
Regulatory Policies Act of 1978 (16 U.S.C. 2623) is amended by adding
the following new paragraph at the end thereof:
``(6) Net metering for federal agencies.--Each electric
utility shall offer to arrange (either directly or through a
third party) to make interconnection and net metering available
to Federal Government agencies, offices, or facilities in
accordance with the requirements of section 115(j). The
standard under this paragraph shall apply only to electric
utilities that sold over 4,000,000 megawatt hours of
electricity in the preceding year to the ultimate consumers
thereof. In the case of a standard under this paragraph, a
period of 1 year after the date of the enactment of this
section shall be substituted for the 2-year period referred to
in other provisions of this section.''.
(b) Special Rules.--Section 115 of the Public Utility Regulatory
Policies Act of 1978 (16 U.S.C. 2625) is amended by adding the
following new subsection at the end thereof:
``(j) Net Metering for Federal Agencies.--(1) The standard under
paragraph (6) of section 113(b) shall require that rates and charges
and contract terms and conditions for the sale of electric energy to
the Federal Government or agency shall be the same as the rates and
charges and contract terms and conditions that would be applicable if
the agency did not own or operate a qualified generation unit and use a
net metering system.
``(2)(A) The standard under paragraph (6) of section 113(b) shall
require that each electric utility shall arrange to provide to the
Government office or agency that qualifies for net metering an
electrical energy meter capable of net metering and measuring, to the
maximum extent practicable, the flow of electricity to or from the
customer, using a single meter and single register, the cost of which
shall be recovered from the customer.
``(B) In a case in which it is not practicable to provide a meter
under subparagraph (A), the utility (either directly or through a third
party) shall, at the expense of the utility install 1 or more of those
electric energy meters.
``(3)(A) The standard under paragraph (6) of section 113(b) shall
require that each electric utility shall calculate the electric energy
consumption for the Government office or agency using a net metering
system that meets the requirements of this subsection and paragraph (6)
of section 113(b) and shall measure the net electricity produced or
consumed during the billing period using the metering installed in
accordance with this paragraph.
``(B) If the electricity supplied by the retail electric supplier
exceeds the electricity generated by the Government office or agency
during the billing period, the Government office or agency shall be
billed for the net electric energy supplied by the retail electric
supplier in accordance with normal billing practices.
``(C) If electric energy generated by the Government office or
agency exceeds the electric energy supplied by the retail electric
supplier during the billing period, the Government office or agency
shall be billed for the appropriate customer charges for that billing
period and credited for the excess electric energy generated during the
billing period, with the credit appearing as a kilowatt-hour credit on
the bill for the following billing period.
``(D) Any kilowatt-hour credits provided to the Government office
or agency as provided in this subsection shall be applied to the
Government office or agency electric energy consumption on the
following billing period bill (except for a billing period that ends in
the next calendar year). At the beginning of each calendar year, any
unused kilowatt-hour credits remaining from the preceding year will
carry over to the new year.
``(4) The standard under paragraph (6) of section 113(b) shall
require that each electric utility shall offer a meter and retail
billing arrangement that has time-differentiated rates. The kilowatt-
hour credit shall be based on the ratio representing the difference in
retail rates for each time-of-use rate, or the credits shall be
reflected on the bill of the Government office or agency as a monetary
credit reflecting retail rates at the time of generation of the
electric energy by the customer-generator.
``(5) The standard under paragraph (6) of section 113(b) shall
require that the qualified generation unit, interconnection standards,
and net metering system used by the Government office or agency shall
meet all applicable safety and performance and reliability standards
established by the National Electrical Code, the Institute of
Electrical and Electronics Engineers, Underwriters Laboratories, and
the American National Standards Institute.
``(6) The standard under paragraph (6) of section 113(b) shall
require that electric utilities shall not make additional charges,
including standby charges, for equipment or services for safety or
performance that are in addition to those necessary to meet the other
standards and requirements of this subsection and paragraph (6) of
section 113(b).
``(7) For purposes of this subsection and paragraph (6) of section
113(b):
``(A) The term `Government' means any office, facility, or
agency of the Federal Government.
``(B) The term `customer-generator' means the owner or
operator of a electricity generation unit.
``(C) The term `electric generation unit' means any
renewable electric generation unit that is owned, operated, or
sited on a Federal Government facility.
``(D) The term `net metering' means the process of--
``(i) measuring the difference between the
electricity supplied to a customer-generator and the
electricity generated by the customer-generator that is
delivered to a utility at the same point of
interconnection during an applicable billing period;
and
``(ii) providing an energy credit to the customer-
generator in the form of a kilowatt-hour credit for
each kilowatt-hour of electricity produced by the
customer-generator from an electric generation unit.''.
(c) Savings Provision.--If this section or a portion of this
section is determined to be invalid or unenforceable, that shall not
affect the validity or enforceability of any other provision of this
Act.
SEC. 153. SUPPORT FOR QUALIFIED ADVANCED ELECTRIC TRANSMISSION
MANUFACTURING PLANTS, QUALIFIED HIGH EFFICIENCY
TRANSMISSION PROPERTY, AND QUALIFIED ADVANCED ELECTRIC
TRANSMISSION PROPERTY.
(a) Loan Guarantees Prior to September 30, 2011.--Section 1705(a)
of the Energy Policy Act of 2005 (42 U.S.C. 16515(a)), as added by
section 406 of the American Recovery and Reinvestment Act of 2009
(Public Law 109-58; 119 Stat. 594) is amended by adding the following
new paragraph at the end thereof:
``(5) The development, construction, acquisition,
retrofitting, or engineering integration of a qualified
advanced electric transmission manufacturing plant or the
construction of a qualified high efficiency transmission
property or a qualified advanced electric transmission property
(whether by construction of new facilities or the modification
of existing facilities). For purposes of this paragraph:
``(A) The term `qualified advanced electric
transmission property' means any high voltage electric
transmission cable, related substation, converter
station, or other integrated facility that--
``(i) utilizes advanced ultra low
resistance superconductive material or other
advanced technology that has been determined by
the Secretary of Energy as--
``(I) reasonably likely to become
commercially viable within 10 years
after the date of enactment of this
paragraph;
``(II) capable of reliably
transmitting at least 5 gigawatts of
high-voltage electric energy for
distances greater than 300 miles with
energy losses not exceeding 3 percent
of the total power transported; and
``(III) not creating an
electromagnetic field;
``(ii) has been determined by an
appropriate energy regulatory body, upon
application, to be in the public interest and
thereby eligible for inclusion in regulated
rates; and
``(iii) can be located safely and
economically in a permanent underground right
of way not to exceed 25 feet in width.
The term `qualified advanced electric transmission
property' shall not include any property placed in
service after December 31, 2016.
``(B)(i) The term `qualified high efficiency
transmission property' means any high voltage overhead
electric transmission line, related substation, or
other integrated facility that--
``(I) utilizes advanced conductor core
technology that--
``(aa) has been determined by the
Secretary of Energy as reasonably
likely to become commercially viable
within 10 years after the date of
enactment of this paragraph;
``(bb) is suitable for use on
transmission lines up to 765kV; and
``(cc) exhibits power losses at
least 30 percent lower than that of
transmission lines using conventional
`ACSR' conductors;
``(II) has been determined by an
appropriate energy regulatory body, upon
application, to be in the public interest and
thereby eligible for inclusion in regulated
rates; and
``(III) can be located safely and
economically in a right of way not to exceed
that used by conventional `ACSR' conductors;
and
``(ii) The term `qualified high efficiency
transmission property' shall not include any property
placed in service after December 31, 2016.
``(C) The term `qualified advanced electric
transmission manufacturing plant' means any industrial
facility located in the United States which can be
equipped, re-equipped, expanded, or established to
produce in whole or in part qualified advanced electric
transmission property.''.
(b) Additional Loan Guarantee Authority.--Section 1703 of the
Energy Policy Act of 2005 (42 U.S.C. 16513) is amended by adding the
following new paragraph at the end of subsection (b):
``(12) The development, construction, acquisition,
retrofitting, or engineering integration of a qualified
advanced electric transmission manufacturing plant or the
construction of a qualified advanced electric transmission
property (whether by construction of new facilities or the
modification of existing facilities). For purposes of this
paragraph, the terms `qualified advanced electric transmission
property' and `qualified advanced electric transmission
manufacturing plant' have the meanings provided by section
1705(a)(5).''.
(c) Grants.--The Secretary of Energy is authorized to provide
grants for up to 50 percent of costs incurred in connection with the
development, construction, acquisition of components for, or
engineering of a qualified advanced electric transmission property
defined in paragraph (5) of section 1705(a) of the Energy Policy Act of
2005 (42 U.S.C. 16515(a)). Such grants may only be made to the first
project which qualifies under that paragraph. There are authorized to
be appropriated for purposes of this subsection not more than
$100,000,000 for fiscal year 2010. The United States shall take no
equity or other ownership interest in the qualified advanced electric
transmission manufacturing plant or qualified advanced electric
transmission property for which funding is provided under this
subsection.
Subtitle G--Technical Corrections to Energy Laws
SEC. 161. TECHNICAL CORRECTIONS TO ENERGY INDEPENDENCE AND SECURITY ACT
OF 2007.
(a) Title III--Energy Savings Through Improved Standards for
Appliance and Lighting.--(1) Section 325(u) of the Energy Policy and
Conservation Act (42 U.S.C. 6295(u)) (as amended by section 301(c) of
the Energy Independence and Security Act of 2007 (121 Stat. 1550)) is
amended--
(A) by redesignating paragraph (7) as paragraph
(4); and
(B) in paragraph (4) (as so redesignated), by
striking ``supplies is'' and inserting ``supply is''.
(2) Section 302 of the Energy Independence and Security Act of 2007
(121 Stat. 1551)) is amended--
(A) in subsection (a), by striking ``end of the paragraph''
and inserting ``end of subparagraph (A)''; and
(B) in subsection (b), by striking ``6313(a)'' and
inserting ``6314(a)''.
(3) Section 343(a)(1) of the Energy Policy and Conservation Act (42
U.S.C. 6313(a)(1)) (as amended by section 302(b) of the Energy
Independence and Security Act of 2007 (121 Stat. 1551)) is amended--
(A) by striking ``Test procedures'' and all that follows
through ``At least once'' and inserting ``Test procedures.--At
least once''; and
(B) by redesignating clauses (i) and (ii) as subparagraphs
(A) and (B), respectively (and by moving the margins of such
subparagraphs 2 ems to the left).
(4) Section 342(a)(6) of the Energy Policy and Conservation Act (42
U.S.C. 6313(a)(6)) (as amended by section 305(b)(2) of the Energy
Independence and Security Act of 2007 (121 Stat. 1554)) is amended--
(A) in subparagraph (B)--
(i) by striking ``If the Secretary'' and inserting
the following:
``(i) In general.--If the Secretary'';
(ii) by striking ``clause (ii)(II)'' and inserting
``subparagraph (A)(ii)(II)'';
(iii) by striking ``clause (i)'' and inserting
``subparagraph (A)(i)''; and
(iv) by adding at the end the following:
``(ii) Factors.--In determining whether a
standard is economically justified for the
purposes of subparagraph (A)(ii)(II), the
Secretary shall, after receiving views and
comments furnished with respect to the proposed
standard, determine whether the benefits of the
standard exceed the burden of the proposed
standard by, to the maximum extent practicable,
considering--
``(I) the economic impact of the
standard on the manufacturers and on
the consumers of the products subject
to the standard;
``(II) the savings in operating
costs throughout the estimated average
life of the product in the type (or
class) compared to any increase in the
price of, or in the initial charges
for, or maintenance expenses of, the
products that are likely to result from
the imposition of the standard;
``(III) the total projected
quantity of energy savings likely to
result directly from the imposition of
the standard;
``(IV) any lessening of the utility
or the performance of the products
likely to result from the imposition of
the standard;
``(V) the impact of any lessening
of competition, as determined in
writing by the Attorney General, that
is likely to result from the imposition
of the standard;
``(VI) the need for national energy
conservation; and
``(VII) other factors the Secretary
considers relevant.
``(iii) Administration.--
``(I) Energy use and efficiency.--
The Secretary may not prescribe any
amended standard under this paragraph
that increases the maximum allowable
energy use, or decreases the minimum
required energy efficiency, of a
covered product.
``(II) Unavailability.--
``(aa) In general.--The
Secretary may not prescribe an
amended standard under this
subparagraph if the Secretary
finds (and publishes the
finding) that interested
persons have established by a
preponderance of the evidence
that a standard is likely to
result in the unavailability in
the United States in any
product type (or class) of
performance characteristics
(including reliability,
features, sizes, capacities,
and volumes) that are
substantially the same as those
generally available in the
United States at the time of
the finding of the Secretary.
``(bb) Other types or
classes.--The failure of some
types (or classes) to meet the
criterion established under
this subclause shall not affect
the determination of the
Secretary on whether to
prescribe a standard for the
other types or classes.''; and
(B) in subparagraph (C)(iv), by striking ``An amendment
prescribed under this subsection'' and inserting
``Notwithstanding subparagraph (D), an amendment prescribed
under this subparagraph''.
(5) Section 342(a)(6)(B)(iii) of the Energy Policy and Conservation
Act (as added by section 306(c) of the Energy Independence and Security
Act of 2007) is transferred and redesignated as clause (vi) of section
342(a)(6)(C) of the Energy Policy and Conservation Act (as amended by
section 305(b)(2) of the Energy Independence and Security Act of 2007).
(6) Section 340 of the Energy Policy and Conservation Act (42
U.S.C. 6311) (as amended by sections 312(a)(2) and 314(a) of the Energy
Independence and Security Act of 2007 (121 Stat. 1564, 1569)) is
amended by redesignating paragraphs (22) and (23) (as added by section
314(a) of that Act) as paragraphs (23) and (24), respectively.
(7) Section 345 of the Energy Policy and Conservation Act (42
U.S.C. 6316) (as amended by section 312(e) of the Energy Independence
and Security Act of 2007 (121 Stat. 1567)) is amended--
(A) by striking ``subparagraphs (B) through (G)'' each
place it appears and inserting ``subparagraphs (B), (C), (D),
(I), (J), and (K)'';
(B) by striking ``part A'' each place it appears and
inserting ``part B''; and
(C) in subsection (h)(3), by striking ``section 342(f)(3)''
and inserting ``section 342(f)(4)''.
(8) Section 340(13) of the Energy Policy and Conservation Act (42
U.S.C. 6311(13)) (as amended by section 313(a) of the Energy
Independence and Security Act of 2007 (121 Stat. 1568)) is amended--
(A) by striking subparagraphs (A) and (B) and inserting the
following:
``(A) In general.--The term `electric motor' means
any motor that is--
``(i) a general purpose T-frame, single-
speed, foot-mounting, polyphase squirrel-cage
induction motor of the National Electrical
Manufacturers Association, Design A and B,
continuous rated, operating on 230/460 volts
and constant 60 Hertz line power as defined in
NEMA Standards Publication MG1-1987; or
``(ii) a motor incorporating the design
elements described in clause (i), but is
configured to incorporate one or more of the
following variations--
``(I) U-frame motor;
``(II) NEMA Design C motor;
``(III) close-coupled pump motor;
``(IV) footless motor;
``(V) vertical solid shaft normal
thrust motor (as tested in a horizontal
configuration);
``(VI) 8-pole motor; or
``(VII) poly-phase motor with a
voltage rating of not more than 600
volts (other than 230 volts or 460
volts, or both, or can be operated on
230 volts or 460 volts, or both).'';
and
(B) by redesignating subparagraphs (C) through (I) as
subparagraphs (B) through (H), respectively.
(9)(A) Section 342(b) of the Energy Policy and Conservation Act (42
U.S.C. 6313(b)) is amended--
(i) in paragraph (1), by striking ``paragraph (2)'' and inserting
``paragraph (3)'';
(ii) by redesignating paragraphs (2) and (3) as paragraphs (3) and
(4);
(iii) by inserting after paragraph (1) the following:
``(2) Standards effective beginning december 19, 2010.--
``(A) In general.--Except for definite purpose
motors, special purpose motors, and those motors
exempted by the Secretary under paragraph (3) and
except as provided for in subparagraphs (B), (C), and
(D), each electric motor manufactured with power
ratings from 1 to 200 horsepower (alone or as a
component of another piece of equipment) on or after
December 19, 2010, shall have a nominal full load
efficiency of not less than the nominal full load
efficiency described in NEMA MG-1 (2006) Table 12-12.
``(B) Fire pump electric motors.--Except for those
motors exempted by the Secretary under paragraph (3),
each fire pump electric motor manufactured with power
ratings from 1 to 200 horsepower (alone or as a
component of another piece of equipment) on or after
December 19, 2010, shall have a nominal full load
efficiency that is not less than the nominal full load
efficiency described in NEMA MG-1 (2006) Table 12-11.
``(C) NEMA design b electric motors.--Except for
those motors exempted by the Secretary under paragraph
(3), each NEMA Design B electric motor with power
ratings of more than 200 horsepower, but not greater
than 500 horsepower, manufactured (alone or as a
component of another piece of equipment) on or after
December 19, 2010, shall have a nominal full load
efficiency of not less than the nominal full load
efficiency described in NEMA MG-1 (2006) Table 12-11.
``(D) Motors incorporating certain design
elements.--Except for those motors exempted by the
Secretary under paragraph (3), each electric motor
described in section 340(13)(A)(ii) manufactured with
power ratings from 1 to 200 horsepower (alone or as a
component of another piece of equipment) on or after
December 19, 2010, shall have a nominal full load
efficiency of not less than the nominal full load
efficiency described in NEMA MG-1 (2006) Table 12-
11.''; and
(iv) in paragraph (3) (as redesignated by clause (ii)), by striking
``paragraph (1)'' each place it appears in subparagraphs (A) and (D)
and inserting ``paragraphs (1) and (2)''.
(B) Section 313 of the Energy Independence and Security Act of 2007
(121 Stat. 1568) is repealed.
(C) The amendments made by--
(i) subparagraph (A) shall take effect on December 19,
2010; and
(ii) subparagraph (B) shall take effect on December 19,
2007.
(10) Section 321(30)(D)(i)(III) of the Energy Policy and
Conservation Act (42 U.S.C. 6291(30)(D)(i)(III)) (as amended by section
321(a)(1)(A) of the Energy Independence and Security Act of 2007 (121
Stat. 1574)) is amended by inserting before the semicolon the
following: ``or, in the case of a modified spectrum lamp, not less than
232 lumens and not more than 1,950 lumens''.
(11) Section 321(30)(T) of the Energy Policy and Conservation Act
(42 U.S.C. 6291(30)(T) (as amended by section 321(a)(1)(B) of the
Energy Independence and Security Act of 2007 (121 Stat. 1574)) is
amended--
(A) in clause (i)--
(i) by striking the comma after ``household
appliance'' and inserting ``and''; and
(ii) by striking ``and is sold at retail,''; and
(B) in clause (ii), by inserting ``when sold at retail,''
before ``is designated''.
(12) Section 325 of the Energy Policy and Conservation Act (42
U.S.C. 6295) (as amended by sections 321(a)(3)(A) and 322(b) of the
Energy Independence and Security Act of 2007 (121 Stat. 1577, 1588)) is
amended by striking subsection (i) and inserting the following:
``(i) General Service Fluorescent Lamps, General Service
Incandescent Lamps, Intermediate Base Incandescent Lamps, Candelabra
Base Incandescent Lamps, and Incandescent Reflector Lamps.--
``(1) Energy efficiency standards.--
``(A) In general.--Each of the following general
service fluorescent lamps, general service incandescent
lamps, intermediate base incandescent lamps, candelabra
base incandescent lamps, and incandescent reflector
lamps manufactured after the effective date specified
in the tables listed in this subparagraph shall meet or
exceed the following lamp efficacy, new maximum
wattage, and CRI standards:
``FLUORESCENT LAMPS
----------------------------------------------------------------------------------------------------------------
Effective Date
Lamp Type Nominal Lamp Minimum CRI Minimum Average Lamp (Period of
Wattage Efficacy (LPW) Months)
----------------------------------------------------------------------------------------------------------------
4-foot medium bi-pin........... >35 W 69 75.0 36
35 W 45 75.0 36
2-foot U-shaped................ >35 W 69 68.0 36
35 W 45 64.0 36
8-foot slimline................ 65 W 69 80.0 18
65 W 45 80.0 18
8-foot high output............. >100 W 69 80.0 18
100 W 45 80.0 18
----------------------------------------------------------------------------------------------------------------
``INCANDESCENT REFLECTOR LAMPS
------------------------------------------------------------------------
Effective Date
Nominal Lamp Wattage Minimum Average Lamp (Period of
Efficacy (LPW) Months)
------------------------------------------------------------------------
40-50....................... 10.5 36
51-66....................... 11.0 36
67-85....................... 12.5 36
86-115...................... 14.0 36
116-155...................... 14.5 36
156-205...................... 15.0 36
------------------------------------------------------------------------
``GENERAL SERVICE INCANDESCENT LAMPS
----------------------------------------------------------------------------------------------------------------
Minimum
Rated Lumen Ranges Maximum Rated Rated Effective
Wattage Lifetime Date
----------------------------------------------------------------------------------------------------------------
1490-2600 72 1,000 hrs 1/1/2012
1050-1489 53 1,000 hrs 1/1/2013
750-1049 43 1,000 hrs 1/1/2014
310-749 29 1,000 hrs 1/1/2014
----------------------------------------------------------------------------------------------------------------
``MODIFIED SPECTRUM GENERAL SERVICE INCANDESCENT LAMPS
----------------------------------------------------------------------------------------------------------------
Minimum
Rated Lumen Ranges Maximum Rated Rated Effective
Wattage Lifetime Date
----------------------------------------------------------------------------------------------------------------
1118-1950 72 1,000 hrs 1/1/2012
788-1117 53 1,000 hrs 1/1/2013
563-787 43 1,000 hrs 1/1/2014
232-562 29 1,000 hrs 1/1/2014
----------------------------------------------------------------------------------------------------------------
``(B) Application.--
``(i) Application criteria.--This
subparagraph applies to each lamp that--
``(I) is intended for a general
service or general illumination
application (whether incandescent or
not);
``(II) has a medium screw base or
any other screw base not defined in
ANSI C81.61-2006;
``(III) is capable of being
operated at a voltage at least
partially within the range of 110 to
130 volts; and
``(IV) is manufactured or imported
after December 31, 2011.
``(ii) Requirement.--For purposes of this
paragraph, each lamp described in clause (i)
shall have a color rendering index that is
greater than or equal to--
``(I) 80 for nonmodified spectrum
lamps; or
``(II) 75 for modified spectrum
lamps.
``(C) Candelabra incandescent lamps and
intermediate base incandescent lamps.--
``(i) Candelabra base incandescent lamps.--
Effective beginning January 1, 2012, a
candelabra base incandescent lamp shall not
exceed 60 rated watts.
``(ii) Intermediate base incandescent
lamps.--Effective beginning January 1, 2012, an
intermediate base incandescent lamp shall not
exceed 40 rated watts.
``(D) Exemptions.--
``(i) Statutory exemptions.--The standards
specified in subparagraph (A) shall not apply
to the following types of incandescent
reflector lamps:
``(I) Lamps rated at 50 watts or
less that are ER30, BR30, BR40, or ER40
lamps.
``(II) Lamps rated at 65 watts that
are BR30, BR40, or ER40 lamps.
``(III) R20 incandescent reflector
lamps rated 45 watts or less.
``(ii) Administrative exemptions.--
``(I) Petition.--Any person may
petition the Secretary for an exemption
for a type of general service lamp from
the requirements of this subsection.
``(II) Criteria.--The Secretary may
grant an exemption under subclause (I)
only to the extent that the Secretary
finds, after a hearing and opportunity
for public comment, that it is not
technically feasible to serve a
specialized lighting application (such
as a military, medical, public safety,
or certified historic lighting
application) using a lamp that meets
the requirements of this subsection.
``(III) Additional criterion.--To
grant an exemption for a product under
this clause, the Secretary shall
include, as an additional criterion,
that the exempted product is unlikely
to be used in a general service
lighting application.
``(E) Extension of coverage.--
``(i) Petition.--Any person may petition
the Secretary to establish standards for lamp
shapes or bases that are excluded from the
definition of general service lamps.
``(ii) Increased sales of exempted lamps.--
The petition shall include evidence that the
availability or sales of exempted incandescent
lamps have increased significantly since the
date on which the standards on general service
incandescent lamps were established.
``(iii) Criteria.--The Secretary shall
grant a petition under clause (i) if the
Secretary finds that--
``(I) the petition presents
evidence that demonstrates that
commercial availability or sales of
exempted incandescent lamp types have
increased significantly since the
standards on general service lamps were
established and likely are being widely
used in general lighting applications;
and
``(II) significant energy savings
could be achieved by covering exempted
products, as determined by the
Secretary based in part on sales data
provided to the Secretary from
manufacturers and importers.
``(iv) No presumption.--The grant of a
petition under this subparagraph shall create
no presumption with respect to the
determination of the Secretary with respect to
any criteria under a rulemaking conducted under
this section.
``(v) Expedited proceeding.--If the
Secretary grants a petition for a lamp shape or
base under this subparagraph, the Secretary
shall--
``(I) conduct a rulemaking to
determine standards for the exempted
lamp shape or base; and
``(II) complete the rulemaking not
later than 18 months after the date on
which notice is provided granting the
petition.
``(F) Effective dates.--
``(i) In general.--In this paragraph,
except as otherwise provided in a table
contained in subparagraph (A) or in clause
(ii), the term `effective date' means the last
day of the month specified in the table that
follows October 24, 1992.
``(ii) Special effective dates.--
``(I) ER, br, and bpar lamps.--The
standards specified in subparagraph (A)
shall apply with respect to ER
incandescent reflector lamps, BR
incandescent reflector lamps, BPAR
incandescent reflector lamps, and
similar bulb shapes on and after
January 1, 2008, or the date that is
180 days after the date of enactment of
the Energy Independence and Security
Act of 2007.
``(II) Lamps between 2.25-2.75
inches in diameter.--The standards
specified in subparagraph (A) shall
apply with respect to incandescent
reflector lamps with a diameter of more
than 2.25 inches, but not more than
2.75 inches, on and after the later of
January 1, 2008, or the date that is
180 days after the date of enactment of
the Energy Independence and Security
Act of 2007.
``(2) Compliance with existing law.--Notwithstanding
section 332(a)(5) and section 332(b), it shall not be unlawful
for a manufacturer to sell a lamp that is in compliance with
the law at the time the lamp was manufactured.
``(3) Rulemaking before october 24, 1995.--
``(A) In general.--Not later than 36 months after
October 24, 1992, the Secretary shall initiate a
rulemaking procedure and shall publish a final rule not
later than the end of the 54-month period beginning on
October 24, 1992, to determine whether the standards
established under paragraph (1) should be amended.
``(B) Administration.--The rule shall contain the
amendment, if any, and provide that the amendment shall
apply to products manufactured on or after the 36-month
period beginning on the date on which the final rule is
published.
``(4) Rulemaking before october 24, 2000.--
``(A) In general.--Not later than 8 years after
October 24, 1992, the Secretary shall initiate a
rulemaking procedure and shall publish a final rule not
later than 9 years and 6 months after October 24, 1992,
to determine whether the standards in effect for
fluorescent lamps and incandescent lamps should be
amended.
``(B) Administration.--The rule shall contain the
amendment, if any, and provide that the amendment shall
apply to products manufactured on or after the 36-month
period beginning on the date on which the final rule is
published.
``(5) Rulemaking for additional general service fluorescent
lamps.--
``(A) In general.--Not later than the end of the
24-month period beginning on the date labeling
requirements under section 324(a)(2)(C) become
effective, the Secretary shall--
``(i) initiate a rulemaking procedure to
determine whether the standards in effect for
fluorescent lamps and incandescent lamps should
be amended so that the standards would be
applicable to additional general service
fluorescent lamps; and
``(ii) publish, not later than 18 months
after initiating the rulemaking, a final rule
including the amended standards, if any.
``(B) Administration.--The rule shall provide that
the amendment shall apply to products manufactured
after a date which is 36 months after the date on which
the rule is published.
``(6) Standards for general service lamps.--
``(A) Rulemaking before january 1, 2014.--
``(i) In general.--Not later than January
1, 2014, the Secretary shall initiate a
rulemaking procedure to determine whether--
``(I) standards in effect for
general service lamps should be
amended; and
``(II) the exclusions for certain
incandescent lamps should be maintained
or discontinued based, in part, on
excluded lamp sales collected by the
Secretary from manufacturers.
``(ii) Scope.--The rulemaking--
``(I) shall not be limited to
incandescent lamp technologies; and
``(II) shall include consideration
of a minimum standard of 45 lumens per
watt for general service lamps.
``(iii) Amended standards.--If the
Secretary determines that the standards in
effect for general service lamps should be
amended, the Secretary shall publish a final
rule not later than January 1, 2017, with an
effective date that is not earlier than 3 years
after the date on which the final rule is
published.
``(iv) Phased-in effective dates.--The
Secretary shall consider phased-in effective
dates under this subparagraph after
considering--
``(I) the impact of any amendment
on manufacturers, retiring and
repurposing existing equipment,
stranded investments, labor contracts,
workers, and raw materials; and
``(II) the time needed to work with
retailers and lighting designers to
revise sales and marketing strategies.
``(v) Backstop requirement.--If the
Secretary fails to complete a rulemaking in
accordance with clauses (i) through (iv) or if
the final rule does not produce savings that
are greater than or equal to the savings from a
minimum efficacy standard of 45 lumens per
watt, effective beginning January 1, 2020, the
Secretary shall prohibit the manufacture of any
general service lamp that does not meet a
minimum efficacy standard of 45 lumens per
watt.
``(vi) State preemption.--Neither section
327(c) nor any other provision of law shall
preclude California or Nevada from adopting,
effective beginning on or after January 1,
2018--
``(I) a final rule adopted by the
Secretary in accordance with clauses
(i) through (iv);
``(II) if a final rule described in
subclause (I) has not been adopted, the
backstop requirement under clause (v);
or
``(III) in the case of California,
if a final rule described in subclause
(I) has not been adopted, any
California regulations relating to
these covered products adopted pursuant
to State statute in effect as of the
date of enactment of the Energy
Independence and Security Act of 2007.
``(B) Rulemaking before january 1, 2020.--
``(i) In general.--Not later than January
1, 2020, the Secretary shall initiate a
rulemaking procedure to determine whether--
``(I) standards in effect for
general service lamps should be
amended; and
``(II) the exclusions for certain
incandescent lamps should be maintained
or discontinued based, in part, on
excluded lamp sales data collected by
the Secretary from manufacturers.
``(ii) Scope.--The rulemaking shall not be
limited to incandescent lamp technologies.
``(iii) Amended standards.--If the
Secretary determines that the standards in
effect for general service lamps should be
amended, the Secretary shall publish a final
rule not later than January 1, 2022, with an
effective date that is not earlier than 3 years
after the date on which the final rule is
published.
``(iv) Phased-in effective dates.--The
Secretary shall consider phased-in effective
dates under this subparagraph after
considering--
``(I) the impact of any amendment
on manufacturers, retiring and
repurposing existing equipment,
stranded investments, labor contracts,
workers, and raw materials; and
``(II) the time needed to work with
retailers and lighting designers to
revise sales and marketing strategies.
``(7) Federal actions.--
``(A) Comments of secretary.--
``(i) In general.--With respect to any lamp
to which standards are applicable under this
subsection or any lamp specified in section
346, the Secretary shall inform any Federal
entity proposing actions that would adversely
impact the energy consumption or energy
efficiency of the lamp of the energy
conservation consequences of the action.
``(ii) Consideration.--The Federal entity
shall carefully consider the comments of the
Secretary.
``(B) Amendment of standards.--Notwithstanding
section 325(n)(1), the Secretary shall not be
prohibited from amending any standard, by rule, to
permit increased energy use or to decrease the minimum
required energy efficiency of any lamp to which
standards are applicable under this subsection if the
action is warranted as a result of other Federal action
(including restrictions on materials or processes) that
would have the effect of either increasing the energy
use or decreasing the energy efficiency of the product.
``(8) Compliance.--
``(A) In general.--Not later than the date on which
standards established pursuant to this subsection
become effective, or, with respect to high-intensity
discharge lamps covered under section 346, the
effective date of standards established pursuant to
that section, each manufacturer of a product to which
the standards are applicable shall file with the
Secretary a laboratory report certifying compliance
with the applicable standard for each lamp type.
``(B) Contents.--The report shall include the lumen
output and wattage consumption for each lamp type as an
average of measurements taken over the preceding 12-
month period.
``(C) Other lamp types.--With respect to lamp types
that are not manufactured during the 12-month period
preceding the date on which the standards become
effective, the report shall--
``(i) be filed with the Secretary not later
than the date that is 12 months after the date
on which manufacturing is commenced; and
``(ii) include the lumen output and wattage
consumption for each such lamp type as an
average of measurements taken during the 12-
month period.''.
(13) Section 325(l)(4)(A) of the Energy Policy and Conservation Act
(42 U.S.C. 6295(l)(4)(A)) (as amended by section 321(a)(3)(B) of the
Energy Independence and Security Act of 2007 (121 Stat. 1581)) is
amended by striking ``only''.
(14) Section 327(b)(1)(B) of the Energy Policy and Conservation Act
(42 U.S.C. 6297(b)(1)(B)) (as amended by section 321(d)(3) of the
Energy Independence and Security Act of 2007 (121 Stat. 1585)) is
amended--
(A) in clause (i), by inserting ``and'' after the semicolon
at the end;
(B) in clause (ii), by striking ``; and'' and inserting a
period; and
(C) by striking clause (iii).
(15) Section 321(e) of the Energy Independence and Security Act of
2007 (121 Stat. 1586) is amended--
(A) in the matter preceding paragraph (1), by striking ``is
amended'' and inserting ``(as amended by section 306(b)) is
amended''; and
(B) by striking paragraphs (1) and (2) and inserting the
following:
``(1) in paragraph (5), by striking `or' after the
semicolon at the end;
``(2) in paragraph (6), by striking the period at the end
and inserting `; or'; and''.
(16) Section 332(a) of the Energy Policy and Conservation Act (42
U.S.C. 6302(a)) (as amended by section 321(e) of the Energy
Independence and Security Act of 2007 (121 Stat. 1586)) is amended by
redesignating the second paragraph (6) as paragraph (7).
(17) Section 321(30)(C)(ii) of the Energy Policy and Conservation
Act (42 U.S.C. 6291(30)(C)(ii)) (as amended by section 322(a)(1)(B) of
the Energy Independence and Security Act of 2007 (121 Stat. 1587)) is
amended by inserting a period after ``40 watts or higher''.
(18) Section 322(b) of the Energy Independence and Security Act of
2007 (121 Stat. 1588)) is amended by striking ``6995(i)'' and inserting
``6295(i)''.
(19) Section 327(c) of the Energy Policy and Conservation Act (42
U.S.C. 6297(c)) (as amended by sections 324(f) of the Energy
Independence and Security Act of 2007 (121 Stat. 1594)) is amended--
(A) in paragraph (6), by striking ``or'' after the
semicolon at the end;
(B) in paragraph (8)(B), by striking ``and'' after the
semicolon at the end;
(C) in paragraph (9)--
(i) by striking ``except that--'' and all that
follows through ``if the Secretary fails to issue'' and
inserting ``except that if the Secretary fails to
issue'';
(ii) by redesignating clauses (i) and (ii) as
subparagraphs (A) and (B), respectively (and by moving
the margins of such subparagraphs 2 ems to the left);
and
(iii) by striking the period at the end and
inserting a semicolon; and
(D) by adding at the end the following:
``(10) is a regulation for general service lamps that
conforms with Federal standards and effective dates;
``(11) is an energy efficiency standard for general service
lamps enacted into law by the State of Nevada prior to December
19, 2007, if the State has not adopted the Federal standards
and effective dates pursuant to subsection (b)(1)(B)(ii); or''.
(20) Section 325(b) of the Energy Independence and Security Act of
2007 (121 Stat. 1596)) is amended by striking ``6924(c)'' and inserting
``6294(c)''.
(b) Title IV--Energy Savings in Buildings and Industry.--(1)
Section 401 of the Energy Independence and Security Act of 2007 (42
U.S.C. 17061) is amended--
(A) in paragraph (2), by striking ``484'' and inserting
``494''; and
(B) in paragraph (13), by striking ``Agency'' and inserting
``Administration''.
(2) Section 422 of the Energy Conservation and Production Act (42
U.S.C. 6872) (as amended by section 411(a) of the Energy Independence
and Security Act of 2007 (121 Stat. 1600)) is amended by striking 1 of
the 2 periods at the end of paragraph (5).
(3) Section 305(a)(3)(D)(i) of the Energy Conservation and
Production Act (42 U.S.C. 6834(a)(3)(D)(i)) (as amended by section
433(a) of the Energy Independence and Security Act of 2007 (121 Stat.
1612)) is amended--
(A) in subclause (I)--
(i) by striking ``in fiscal year 2003 (as measured
by Commercial Buildings Energy Consumption Survey or
Residential Energy Consumption Survey data from the
Energy Information Agency'' and inserting ``as measured
by the calendar year 2003 Commercial Buildings Energy
Consumption Survey or the calendar year 2005
Residential Energy Consumption Survey data from the
Energy Information Administration''; and
(ii) in the table at the end, by striking ``Fiscal
Year'' and inserting ``Calendar Year''; and
(B) in subclause (II)--
(i) by striking ``(II) Upon petition'' and
inserting the following:
``(II) Downward adjustment of
numeric requirement.--
``(aa) In general.--On
petition''; and
(ii) by striking the last sentence and inserting
the following:
``(bb) Exceptions to
requirement for concurrence of
secretary.--
``(AA) In
general.--The
requirement to petition
and obtain the
concurrence of the
Secretary under this
subclause shall not
apply to any Federal
building with respect
to which the
Administrator of
General Services is
required to transmit a
prospectus to Congress
under section 3307 of
title 40, United States
Code, or to any other
Federal building
designed, constructed,
or renovated by the
Administrator if the
Administrator
certifies, in writing,
that meeting the
applicable numeric
requirement under
subclause (I) with
respect to the Federal
building would be
technically
impracticable in light
of the specific
functional needs for
the building.
``(BB)
Adjustment.--In the
case of a building
described in subitem
(AA), the Administrator
may adjust the
applicable numeric
requirement of
subclause (I) downward
with respect to the
building.''.
(4) Section 436(c)(3) of the Energy Independence and Security Act
of 2007 (42 U.S.C. 17092(c)(3)) is amended by striking ``474'' and
inserting ``494''.
(5) Section 440 of the Energy Independence and Security Act of 2007
(42 U.S.C. 17096) is amended by striking ``and 482''.
(6) Section 373(c) of the Energy Policy and Conservation Act (42
U.S.C. 6343(c)) (as amended by section 451(a) of the Energy
Independence and Security Act of 2007 (121 Stat. 1628)) is amended by
striking ``Administrator'' and inserting ``Secretary''.
(c) Date of Enactment.--Section 1302 of the Energy Independence and
Security Act of 2007 (42 U.S.C. 17382) is amended in the first sentence
by striking ``enactment'' and inserting ``the date of enactment of this
Act''.
(d) Reference.--Section 1306(c)(3) of the Energy Independence and
Security Act of 2007 (42 U.S.C. 17386(c)(3)) is amended by striking
``section 1307 (paragraph (17) of section 111(d) of the Public Utility
Regulatory Policies Act of 1978)'' and inserting ``paragraph (19) of
section 111(d) of the Public Utility Regulatory Policies Act of 1978
(16 U.S.C. 2621(d))''.
(e) Effective Date.--This section and the amendments made by this
section take effect as if included in the Energy Independence and
Security Act of 2007 (Public Law 110-140; 121 Stat. 1492).
SEC. 162. TECHNICAL CORRECTIONS TO ENERGY POLICY ACT OF 2005.
(a) Title I--Energy Efficiency.--Section 325(g)(8)(C)(ii) of the
Energy Policy and Conservation Act (42 U.S.C. 6295(g)(8)(C)(ii)) (as
added by section 135(c)(2)(B) of the Energy Policy Act of 2005) is
amended by striking ``20F'' and inserting ``-20F''.
(b) Effective Date.--This section and the amendments made by this
section take effect as if included in the Energy Policy Act of 2005
(Public Law 109-58; 119 Stat. 594).
Subtitle H--Energy and Efficiency Centers and Research
SEC. 171. ENERGY INNOVATION HUBS.
(a) Purpose.--The Secretary shall carry out a program to establish
Energy Innovation Hubs to enhance the Nation's economic, environmental,
and energy security by promoting commercial application of clean,
indigenous energy alternatives to oil and other fossil fuels, reducing
greenhouse gas emissions, and ensuring that the United States maintains
a technological lead in the development and commercial application of
state-of-the-art energy technologies. To achieve these purposes the
program shall--
(1) leverage the expertise and resources of the university
and private research communities, industry, venture capital,
national laboratories, and other participants in energy
innovation to support cross-disciplinary research and
development in areas not being served by the private sector in
order to develop and transfer innovative clean energy
technologies into the marketplace;
(2) expand the knowledge base and human capital necessary
to transition to a low-carbon economy; and
(3) promote regional economic development by cultivating
clusters of clean energy technology firms, private research
organizations, suppliers, and other complementary groups and
businesses.
(b) Definitions.--For purposes of this section:
(1) Allowance.--The term ``allowance'' means an emission
allowance established under section 721 of the Clean Air Act
(as added by section 311 of this Act).
(2) Clean energy technology.--The term ``clean energy
technology'' means a technology that--
(A) produces energy from solar, wind, geothermal,
biomass, tidal, wave, ocean, and other renewable energy
resources (as such term is defined in section 610 of
the Public Utility Regulatory Policies Act of 1978);
(B) more efficiently transmits, distributes, or
stores energy;
(C) enhances energy efficiency for buildings and
industry, including combined heat and power;
(D) enables the development of a Smart Grid (as
described in section 1301 of the Energy Independence
and Security Act of 2007 (42 U.S.C. 17381)), including
integration of renewable energy resources and
distributed generation, demand response, demand side
management, and systems analysis;
(E) produces an advanced or sustainable material
with energy or energy efficiency applications;
(F) enhances water security through improved water
management, conservation, distribution, and end use
applications; or
(G) improves energy efficiency for transportation,
including electric vehicles.
(3) Cluster.--The term ``cluster'' means a network of
entities directly involved in the research, development,
finance, and commercialization of clean energy technologies
whose geographic proximity facilitates utilization and sharing
of skilled human resources, infrastructure, research
facilities, educational and training institutions, venture
capital, and input suppliers.
(4) Hub.--The term ``Hub'' means an Energy Innovation Hub
established in accordance with this section.
(5) Project.--The term ``project'' means an activity with
respect to which a Hub provides support under subsection (e).
(6) Qualifying entity.--The term ``qualifying entity''
means each of the following:
(A) A research university.
(B) A State or Federal institution with a focus on
the advancement of clean energy technologies.
(C) A nongovernmental organization with research or
commercialization expertise in clean energy technology
development.
(7) Secretary.--The term ``Secretary'' means the Secretary
of Energy.
(8) Technology development focus.--The term ``technology
development focus'' means the unique technology development
areas in which a Hub will specialize, and may include solar
electricity, fuels from solar energy, batteries and energy
storage, electricity grid systems and devices, energy efficient
building systems and design, advanced materials, modeling and
simulation, and other clean energy technology development areas
designated by the Secretary.
(9) Translational research.--The term ``translational
research'' means coordination of basic or applied research with
technical and commercial applications to enable promising
discoveries or inventions to attract investment sufficient for
market penetration and diffusion.
(10) Vintage year.--The term ``vintage year'' has the
meaning given that term in section 700 of the Clean Air Act (as
added by section 312 of this Act).
(c) Role of the Secretary.--The Secretary shall--
(1) have ultimate responsibility for, and oversight of, all
aspects of the program under this section;
(2) provide for the distribution of allowances allocated
under section 782(h)(1) of the Clean Air Act (as added by
section 321 of this Act) to support the establishment of 8
Hubs, each with a unique designated technology development
focus, pursuant to this section;
(3) coordinate the innovation activities of Hubs with those
occurring through other Department of Energy entities,
including the National Laboratories, the Advanced Research
Projects Agency--Energy, and Energy Frontier Research
Collaborations, and within industry, including by annually--
(A) issuing guidance regarding national energy
research and development priorities and strategic
objectives; and
(B) convening a conference of staff of the
Department of Energy and representatives from such
other entities to share research results, program
plans, and opportunities for collaboration.
(d) Entities Eligible for Support.--A consortium shall be eligible
to receive allowances to support the establishment of a Hub under this
section if--
(1) it is composed of--
(A) 2 research universities with a combined annual
research budget of $500,000,000; and
(B) 1 or more additional qualifying entities;
(2) its members have established a binding agreement that
documents--
(A) the structure of the partnership agreement;
(B) a governance and management structure to enable
cost-effective implementation of the program;
(C) an intellectual property management policy;
(D) a conflicts of interest policy consistent with
subsection (e)(4);
(E) an accounting structure that meets the
requirements of the Department of Energy and can be
audited under subsection (f)(5); and
(F) that it has an Advisory Board consistent with
subsection (e)(3);
(3) it receives financial contributions from States,
consortium participants, or other non-Federal sources, to be
used to support project awards pursuant to subsection (e);
(4) it is part of an existing cluster or demonstrates high
potential to develop a new cluster; and
(5) it operates as a nonprofit organization.
(e) Energy Innovation Hubs.--
(1) Role.--Hubs receiving allowances under this section
shall support translational research activities leading to
commercial application of clean energy technologies, in
accordance with the purposes of this section, through issuance
of awards to projects managed by qualifying entities and other
entities meeting the Hub's project criteria, including national
laboratories. Each such Hub shall--
(A) develop and publish for public review and
comment proposed plans, programs, project selection
criteria, and terms for individual project awards under
this subsection;
(B) submit an annual report to the Secretary
summarizing the Hub's activities, organizational
expenditures, and Board members, which shall include a
certification of compliance with conflict of interest
policies and a description of each project in the
research portfolio;
(C) establish policies--
(i) regarding intellectual property
developed as a result of Hub awards and other
forms of technology support that encourage
individual ingenuity and invention while
speeding technology transfer and facilitating
the establishment of rapid commercialization
pathways;
(ii) to prevent resources provided to the
Hub from being used to displace private sector
investment otherwise likely to occur, including
investment from private sector entities that
are members of the consortium;
(iii) to facilitate the participation of
private investment firms or other private
entities that invest in clean energy
technologies to perform due diligence on award
proposals, to participate in the award review
process, and to provide guidance to projects
supported by the Hub; and
(iv) to facilitate the participation of
entrepreneurs with a demonstrated history of
developing and commercializing clean energy
technologies;
(D) oversee project solicitations, review proposed
projects, and select projects for awards; and
(E) monitor project implementation.
(2) Distribution of awards by hubs.--A Hub shall distribute
awards under this subsection to support clean energy technology
projects conducting translational research and related
activities, provided that at least 50 percent of such support
shall be provided to projects related to the Hub's technology
development focus.
(3) Advisory boards.--
(A) In general.--Each Hub shall establish an
Advisory Board, the members of which shall have
extensive and relevant scientific, technical, industry,
financial, or research management expertise. The
Advisory Board shall review the Hub's proposed plans,
programs, project selection criteria, and projects and
shall ensure that projects selected for awards meet the
conflict of interest policies of the Hub. Advisory
Board members other than those representing consortium
members shall serve for no more than 3 years. All
Advisory Board members shall comply with the Hub's
conflict of interest policies and procedures.
(B) Members.--Each Advisory Board shall consist
of--
(i) 5 members selected by the consortium's
research universities;
(ii) 2 members selected by the consortium's
other qualifying entities;
(iii) 2 members selected at large by other
Advisory Board members to represent the
entrepreneur and venture capital communities;
and
(iv) 1 member appointed by the Secretary.
(D) Compensation.--Members of an Advisory Board may
receive reimbursement for travel expenses and a
reasonable stipend.
(4) Conflict of interest.--
(A) Procedures.--Hubs shall establish procedures to
ensure that any employee or consortia designee for Hub
activities who serves in a decisionmaking capacity
shall--
(i) disclose any financial interests in, or
financial relationships with, applicants for or
recipients of awards under this subsection,
including those of his or her spouse or minor
child, unless such relationships or interests
would be considered to be remote or
inconsequential; and
(ii) recuse himself or herself from any
funding decision for projects in which he or
she has a personal financial interest.
(B) Disqualification and revocation.--The Secretary
may disqualify an application or revoke allowances
distributed to the Hub or awards provided under this
subsection, if cognizant officials of the Hub fail to
comply with procedures required under subparagraph (A).
(f) Distribution of Allowances to Energy Innovation Hubs.--
(1) Distribution of allowances.--Not later than September
30 of 2011 and each calendar year thereafter through 2049, the
Secretary shall, in accordance with the requirements of this
section, distribute to eligible consortia allowances allocated
for the following vintage year under section 782(h)(1) of the
Clean Air Act (as added by section 321 of this Act). Not less
than 10 percent and not more than 30 percent of the allowances
available for distribution in any given year shall be
distributed to support any individual Hub under this section.
(2) Selection and schedule.--Allowances to support the
establishment of a Hub shall be distributed to eligible
consortia (as defined in subsection (d)) selected through a
competitive process. Not later than 120 days after the date of
enactment of this Act, the Secretary shall solicit proposals
from eligible consortia to establish Hubs, which shall be
submitted not later than 180 days after the date of enactment
of this Act. The Secretary shall select the program consortia
not later than 270 days after the date of enactment of this
Act. For at least 3 awards to consortia under this section, the
Secretary shall give special consideration to applications in
which 1 or more of the institutions under subsection (d)(1)(A)
are 1890 Land Grant Institutions (as defined in section 2 of
the Agricultural Research, Extension, and Education Reform Act
of 1998 (7 U.S.C. 7061)), Predominantly Black Institutions (as
defined in section 318 of the Higher Education Act of 1965 (20
U.S.C. 1059e)), Tribal Colleges or Universities (as defined in
section 316(b) of the Higher Education Act of 1965 (20 U.S.C.
1059c(b)), or Hispanic Serving Institutions (as defined in
section 318 of the Higher Education Act of 1965 (20 U.S.C.
1059e)).
(3) Amount and term of awards.--For each Hub selected to
receive an award under this subsection, the Secretary shall
define a quantity of allowances that shall be distributed to
such Hub each year for an initial period not to exceed 5 years.
The Secretary may extend the term of such award by up to 5
additional years, and a Hub may compete to receive an increase
in the quantity of allowances per year that it shall receive
during any such extension. A Hub shall be eligible to compete
for a new award after the expiration of the term of any award,
including any extension of such term, under this subsection.
(4) Use of allowances.--Allowances distributed under this
section shall be used exclusively to support project awards
pursuant to subsection (e)(1) and (2), provided that a Hub may
use not more than 10 percent of the value of such allowances
for its administrative expenses related to making such awards.
Allowances distributed under this section shall not be used for
construction of new buildings or facilities for Hubs, and
construction of new buildings or facilities shall not be
considered as part of the non-Federal share of a cost sharing
agreement under this section.
(5) Audit.--Each Hub shall conduct, in accordance with such
requirements as the Secretary may prescribe, an annual audit to
determine the extent to which allowances distributed to the Hub
under this subsection, and awards under subsection (e), have
been utilized in a manner consistent with this section. The
auditor shall transmit a report of the results of the audit to
the Secretary and to the Government Accountability Office. The
Secretary shall include such report in an annual report to
Congress, along with a plan to remedy any deficiencies cited in
the report. The Government Accountability Office may review
such audits as appropriate and shall have full access to the
books, records, and personnel of the Hub to ensure that
allowances distributed to the Hub under this subsection, and
awards made under subsection (e), have been utilized in a
manner consistent with this section.
(6) Revocation of allowances.--The Secretary shall have
authority to review awards made under this subsection and to
revoke such awards if the Secretary determines that a Hub has
used the award in a manner not consistent with the requirements
of this section.
SEC. 172. ADVANCED ENERGY RESEARCH.
(a) Definitions.--For purposes of this section:
(1) Allowance.--The term ``allowance'' means an emission
allowance established under section 721 of the Clean Air Act
(as added by section 311 of this Act).
(2) Director.--The term ``Director'' means Director of the
Advanced Research Projects Agency-Energy.
(b) In General.--Not later than September 30 of 2011 and each
calendar year thereafter through 2049, the Director shall distribute
allowances allocated for the following vintage year under section
782(h)(2) of the Clean Air Act (as added by section 321 of this Act).
Such allowances shall be distributed on a competitive basis to
institutions of higher education, companies, research foundations,
trade and industry research collaborations, or consortia of such
entities, or other appropriate research and development entities to
achieve the goals of the Advanced Research Projects Agency-Energy (as
described in section 5012(c) of the America COMPETES Act) through
targeted acceleration of--
(1) novel early-stage energy research with possible
technology applications;
(2) development of techniques, processes, and technologies,
and related testing and evaluation;
(3) development of manufacturing processes for
technologies; and
(4) demonstration and coordination with nongovernmental
entities for commercial applications of technologies and
research applications.
(c) Responsibilities.--The Director shall be responsible for
assessing the success of programs and terminating programs carried out
under this section that are not achieving the goals of the programs,
consistent with 5012(e)(2) and (4) of the America COMPETES Act. The
Director shall designate program managers whose responsibilities are
consistent with 5012(f)(1)(B) of the America COMPETES Act. The
Director's reporting and coordination requirements established through
5012(g) and (h) of the America COMPETES Act shall apply to activities
funded through this section.
(d) Supplement Not Supplant.--Assistance provided under this
section shall be used to supplement, and not to supplant, any other
Federal resources available to carry out activities described in this
section.
SEC. 173. BUILDING ASSESSMENT CENTERS.
(a) In General.--The Secretary of Energy (in this section referred
to as the ``Secretary'') shall provide funding to institutions of
higher education for Building Assessment Centers to--
(1) identify opportunities for optimizing energy efficiency
and environmental performance in existing buildings;
(2) promote high-efficiency building construction
techniques and materials options;
(3) promote applications of emerging concepts and
technologies in commercial and institutional buildings;
(4) train engineers, architects, building scientists, and
building technicians in energy-efficient design and operation;
(5) assist local community colleges, trade schools,
registered apprenticeship programs and other accredited
training programs in training building technicians;
(6) promote research and development for the use of
alternative energy sources to supply heat and power, for
buildings, particularly energy-intensive buildings; and
(7) coordinate with and assist State-accredited technical
training centers and community colleges, while ensuring
appropriate services to all regions of the United States.
(b) Coordination With Regional Centers for Energy and Environmental
Knowledge and Outreach.--A Building Assessment Center may serve as a
Center for Energy and Environmental Knowledge and Outreach established
pursuant to section 174.
(c) Coordination and Duplication.--The Secretary shall coordinate
efforts under this section with other programs of the Department of
Energy and other Federal agencies to avoid duplication of effort.
(d) Authorization of Appropriations.--There are authorized to be
appropriated to the Secretary to carry out this section $50,000,000 for
fiscal year 2010 and each fiscal year thereafter.
SEC. 174. CENTERS FOR ENERGY AND ENVIRONMENTAL KNOWLEDGE AND OUTREACH.
(a) Regional Centers for Energy and Environmental Knowledge and
Outreach.--
(1) Establishment.--The Secretary shall establish not more
than 10 regional Centers for Energy and Environmental Knowledge
and Outreach at institutions of higher education to coordinate
with and advise industrial research and assessment centers,
Building Assessment Centers, and Clean Energy Application
Centers located in the region of such Center for Energy and
Environmental Knowledge and Outreach.
(2) Technical assistance programs.--Each Center for Energy
and Environmental Knowledge and Outreach shall consist of at
least one, new or existing, high performing, of the following:
(A) An industrial research and assessment center.
(B) A Clean Energy Application Center.
(C) A Building Assessment Center.
(3) Selection criteria.--The Secretary shall select Centers
for Energy and Environmental Knowledge and Outreach through a
competitive process, based on the following:
(A) Identification of the highest performing
industrial research and assessment centers, Clean
Energy Application Centers, and Building Assessment
Centers.
(B) The degree to which an institution of higher
education maintains credibility among regional private
sector organizations such as trade associations,
engineering associations, and environmental
organizations.
(C) The degree to which an institution of higher
education is providing or has provided technical
assistance, academic leadership, and market leadership
in the energy arena in a manner that is consistent with
the areas of focus of industrial research and
assessment centers, Clean Energy Application Centers,
and Building Assessment Centers.
(D) The presence of an additional industrial
research and assessment center, Clean Energy
Application Center, or Building Assessment Center at
the institution of higher education.
(4) Geographic diversity.--In selecting Centers for Energy
and Environmental Knowledge and Outreach under this subsection,
the Secretary shall ensure such Centers are distributed
geographically in a relatively uniform manner to ensure all
regions of the Nation are represented.
(5) Regional leadership.--Each Center for Energy and
Environmental Knowledge and Outreach shall, to the extent
possible, provide leadership to all other industrial research
and assessment centers, Clean Energy Application Centers, and
Building Assessment Centers located in the Center's geographic
region, as determined by the Secretary. Such leadership shall
include--
(A) developing regional goals specific to the
purview of the industrial research and assessment
centers, Clean Energy Application Centers, and Building
Assessment Centers programs;
(B) developing regionally specific technical
resources; and
(C) outreach to interested parties in the region to
inform them of the information, resources, and services
available through the associated industrial research
and assessment centers, Clean Energy Application
Centers, and Building Assessment Centers.
(6) Further coordination.--To increase the value and
capabilities of the regionally associated industrial research
and assessment centers, Clean Energy Application Centers, and
Building Assessment Centers programs, Centers for Energy and
Environmental Knowledge and Outreach shall--
(A) coordinate with Manufacturing Extension
Partnership Centers of the National Institute of
Science and Technology;
(B) coordinate with the relevant programs in the
Department of Energy, including the Building Technology
Program and Industrial Technologies Program;
(C) increase partnerships with the National
Laboratories of the Department of Energy to leverage
the expertise and technologies of the National
Laboratories to achieve the goals of the industrial
research and assessment centers, Clean Energy
Application Centers, and Building Assessment Centers;
(D) work with relevant municipal, county, and State
economic development entities to leverage relevant
financial incentives for capital investment and other
policy tools for the protection and growth of local
business and industry;
(E) partner with local professional and private
trade associations and business development interests
to leverage existing knowledge of local business
challenges and opportunities;
(F) work with energy utilities and other
administrators of publicly funded energy programs to
leverage existing energy efficiency and clean energy
programs;
(G) identify opportunities for reducing greenhouse
gas emissions; and
(H) promote sustainable business practices for
those served by the industrial research and assessment
centers, Clean Energy Application Centers, and Building
Assessment Centers.
(7) Workforce training.--
(A) In general.--The Secretary shall require each
Center for Energy and Environmental Knowledge and
Outreach to establish or maintain an internship program
for the region of such Center, designed to encourage
students who perform energy assessments to continue
working with a particular company, building, or
facility to help implement the recommendations
contained in any such assessment provided to such
company, building, or facility. Each Center for Energy
and Environmental Knowledge and Outreach shall act as
internship coordinator to help match students to
available opportunities.
(B) Federal share.--The Federal share of the cost
of carrying out internship programs described under
subparagraph (A) shall be 50 percent.
(C) Funding.--Subject to the availability of
appropriations, of the funds made available to carry
out this subsection, the Secretary shall use to carry
out this paragraph not less than $5,000,000 for fiscal
year 2010 and each fiscal year thereafter.
(8) Small business loans.--The Administrator of the Small
Business Administration shall, to the maximum practicable,
expedite consideration of applications from eligible small
business concerns for loans under the Small Business Act (15
U.S.C. 631 et seq.) for loans to implement recommendations of
any industrial research and assessment center, Clean Energy
Application Center, or Building Assessment Center.
(9) Definitions.--In this subsection:
(A) Industrial research and assessment center.--The
term ``industrial research and assessment center''
means a center established or maintained pursuant to
section 452(e) of the Energy Independence and Security
Act of 2007 (42 U.S.C. 17111(e)).
(B) Clean energy application center.--The term
``Clean Energy Application Center'' means a center
redesignated and described section under section 375 of
the Energy Policy and Conservation Act (42 U.S.C.
6345).
(C) Building assessment center.--The term
``Building Assessment Center'' means an institution of
higher education-based center established pursuant to
section 173.
(D) Secretary.--The term ``Secretary'' means the
Secretary of Energy.
(10) Funding.--There are authorized to be appropriated to
the Secretary to carry out this subsection $10,000,000 for
fiscal year 2010 and each fiscal year thereafter. Subject to
the availability of appropriations, of the funds made available
to carry out this subsection, the Secretary shall provide to
each Center for Energy and Environmental Knowledge and Outreach
not less than $500,000 for fiscal year 2010 and each fiscal
year thereafter.
(b) Integration of Other Technical Assistance Programs.--
(1) Clean energy application centers.--Section 375 of the
Energy Policy and Conservation Act (42 U.S.C. 6345) is
amended--
(A) by redesignating subsection (f) as subsection
(g); and
(B) by adding after subsection (e) the following
new subsection:
``(f) Coordination With Centers for Energy and Environmental
Knowledge and Outreach.--A Clean Energy Application Center may serve as
a Center for Energy and Environmental Knowledge and Outreach
established pursuant to section 174 of the American Clean Energy and
Security Act of 2009.''.
(2) Industrial research and assessment centers.--Section
452(e) of the Energy Independence and Security Act of 2007 (42
U.S.C. 17111(e)) is amended--
(A) by striking ``The Secretary'' and all that
follows through ``shall be--'' and inserting the
following:
``(1) In general.--The Secretary shall provide funding to
institution of higher education-based industrial research and
assessment centers, whose purposes shall be--'';
(B) by redesignating paragraphs (1) through (5) as
subparagraphs (A) through (E), respectively (and by
moving the margins of such subparagraphs 2 ems to the
right); and
(C) by adding at the end the following new
paragraph:
``(2) Coordination with centers for energy and
environmental knowledge and outreach.--An industrial research
and assessment center may serve as a Center for Energy and
Environmental Knowledge and Outreach established pursuant to
section 174 of the American Clean Energy and Security Act of
2009.''.
(c) Additional Funding for Clean Energy Application Centers.--
Subsection (g) of section 375 of the Energy Policy and Conservation Act
(42 U.S.C. 6345(f)), as redesignated by subsection (b)(1) of this
section, is amended by striking ``$10,000,000 for each of fiscal years
2008 through 2012'' and inserting ``$30,000,000 for fiscal year 2010
and each fiscal year thereafter''.
SEC. 175. HIGH EFFICIENCY GAS TURBINE RESEARCH, DEVELOPMENT, AND
DEMONSTRATION.
(a) In General.--The Secretary of Energy shall carry out a
multiyear, multiphase program of research, development, and technology
demonstration to improve the efficiency of gas turbines used in
combined cycle power generation systems and to identify the
technologies that ultimately will lead to gas turbine combined cycle
efficiency of 65 percent.
(b) Program Elements.--The program under this section shall--
(1) support first-of-a-kind engineering and detailed gas
turbine design for utility-scale electric power generation,
including--
(A) high temperature materials, including
superalloys, coatings, and ceramics;
(B) improved heat transfer capability;
(C) manufacturing technology required to construct
complex three-dimensional geometry parts with improved
aerodynamic capability;
(D) combustion technology to produce higher firing
temperature while lowering nitrogen oxide and carbon
monoxide emissions per unit of output;
(E) advanced controls and systems integration;
(F) advanced high performance compressor
technology; and
(G) validation facilities for the testing of
components and subsystems;
(2) include technology demonstration through component
testing, subscale testing, and full scale testing in existing
fleets;
(3) include field demonstrations of the developed
technology elements so as to demonstrate technical and economic
feasibility; and
(4) assess overall combined cycle system performance.
(c) Program Goals.--The goals of the multiphase program established
under subsection (a) shall be--
(1) in phase I--
(A) to develop the conceptual design of advanced
high efficiency gas turbines that can achieve at least
62 percent combined cycle efficiency on a lower heating
value basis; and
(B) to develop and demonstrate the technology
required for advanced high efficiency gas turbines that
can achieve at least 62 percent combined cycle
efficiency on a lower heating value basis; and
(2) in phase II, to develop the conceptual design for
advanced high efficiency gas turbines that can achieve at least
65 percent combined cycle efficiency on a lower heating value
basis.
(d) Proposals.--Within 180 days after the date of enactment of this
section, the Secretary shall solicit proposals for conducting
activities under this section. In selecting proposals, the Secretary
shall emphasize--
(1) the extent to which the proposal will stimulate the
creation or increased retention of jobs in the United States;
and
(2) the extent to which the proposal will promote and
enhance United States technology leadership.
(e) Cost Sharing.--Section 988 of the Energy Policy Act of 2005 (42
U.S.C. 16352) shall apply to an award of financial assistance made
under this section.
(f) Limits on Participation.--The limits on participation
applicable under section 999E of the Energy Policy Act of 2005 (42
U.S.C. 16375) shall apply to financial assistance awarded under this
section.
(g) Authorization of Appropriations.--There are authorized to be
appropriated to the Secretary for carrying out this section $65,000,000
for each of fiscal years 2011 through 2014.
Subtitle I--Nuclear and Advanced Technologies
SEC. 181. REVISIONS TO LOAN GUARANTEE PROGRAM AUTHORITY.
(a) Definition of Conditional Commitment.--Section 1701 of the
Energy Policy Act of 2005 (42 U.S.C. 16511), as amended by section
130(a) of this Act, is amended by adding after paragraph (7) the
following:
``(8) Conditional commitment.--The term `conditional
commitment' means a final term sheet negotiated between the
Secretary and a project sponsor or sponsors, which term sheet
shall be binding on both parties and become a final loan
guarantee agreement if all conditions precedent established in
the term sheet, which shall include the acquisition of all
necessary permits and licenses, are satisfied.''.
(b) Specific Appropriation or Contribution.--Section 1702 of the
Energy Policy Act of 2005 (42 U.S.C. 16512) is amended by striking
subsection (b) and inserting the following:
``(b) Specific Appropriation or Contribution.--
``(1) In general.--No guarantee shall be made unless--
``(A) an appropriation for the cost has been made;
``(B) the Secretary has received from the borrower
a payment in full for the cost of the obligation and
deposited the payment into the Treasury; or
``(C) a combination of appropriations or payments
from the borrower has been made sufficient to cover the
cost of the obligation.
``(2) Limitation.--The source of payments received from a
borrower under paragraph (1)(B) shall not be a loan or other
debt obligation that is made or guaranteed by the Federal
Government.''.
(c) Fees.--Section 1702(h) of the Energy Policy Act of 2005 (42
U.S.C. 16512(h)) is amended by striking paragraph (2) and inserting the
following:
``(2) Availability.--Fees collected under this subsection
shall--
``(A) be deposited by the Secretary into a special
fund in the Treasury to be known as the `Incentives For
Innovative Technologies Fund'; and
``(B) remain available to the Secretary for
expenditure, without further appropriation or fiscal
year limitation, for administrative expenses incurred
in carrying out this title.''.
(d) Wage Rate Requirements.--Section 1702 of the Energy Policy Act
of 2005 (42 U.S.C. 16512) is amended by adding at the end the following
new subsection:
``(k) Wage Rate Requirements.--No loan guarantee shall be made
under this title unless the borrower has provided to the Secretary
reasonable assurances that all laborers and mechanics employed by
contractors and subcontractors in the performance of construction work
financed in whole or in part by the guaranteed loan will be paid wages
at rates not less than those prevailing on projects of a character
similar to the contract work in the civil subdivision of the State in
which the contract work is to be performed as determined by the
Secretary of Labor in accordance with subchapter IV of chapter 31 of
part A of subtitle II of title 40, United States Code. With respect to
the labor standards specified in this subsection, the Secretary of
Labor shall have the authority and functions set forth in
Reorganization Plan Numbered 14 of 1950 (64 Stat. 1267; 5 U.S.C. App.)
and section 3145 of title 40, United States Code.''.
(e) Subrogation.--Section 1702(g)(2) of the Energy Policy Act of
2005 (42 U.S.C. 16512(g)(2)) is amended by striking subparagraphs (B)
and (C) and inserting the following:
``(B) Superiority of rights.--Except as provided in
subparagraph (C), the rights of the Secretary, with
respect to any property acquired pursuant to a
guarantee or related agreements, shall be superior to
the rights of any other person with respect to the
property.
``(C) Terms and conditions.--A guarantee agreement
shall include such detailed terms and conditions as the
Secretary determines appropriate to--
``(i) protect the financial interests of
the United States in the case of default;
``(ii) have available all the patents and
technology necessary for any person selected,
including the Secretary, to complete and
operate the project;
``(iii) provide for sharing the proceeds
received from the sale of project assets with
other creditors or control the disposition of
project assets if necessary to protect the
financial interests of the United States in the
case of default; and
``(iv) provide such lien priority in
project assets as necessary to protect the
financial interests of the United States in the
case of a default.''.
SEC. 182. PURPOSE.
The purpose of sections 183 through 189 of this subtitle is to
promote the domestic development and deployment of clean energy
technologies required for the 21st century through the establishment of
a self-sustaining Clean Energy Deployment Administration that will
provide for an attractive investment environment through partnership
with and support of the private capital market in order to promote
access to affordable financing for accelerated and widespread
deployment of--
(1) clean energy technologies;
(2) advanced or enabling energy infrastructure
technologies;
(3) energy efficiency technologies in residential,
commercial, and industrial applications, including end-use
efficiency in buildings; and
(4) manufacturing technologies for any of the technologies
or applications described in this section.
SEC. 183. DEFINITIONS.
In this subtitle:
(1) Administration.--The term ``Administration'' means the
Clean Energy Deployment Administration established by section
186.
(2) Advisory council.--The term ``Advisory Council'' means
the Energy Technology Advisory Council of the Administration.
(3) Breakthrough technology.--The term ``breakthrough
technology'' means a clean energy technology that--
(A) presents a significant opportunity to advance
the goals developed under section 185, as assessed
under the methodology established by the Advisory
Council; but
(B) has generally not been considered a
commercially ready technology as a result of high
perceived technology risk or other similar factors.
(4) Clean energy technology.--The term ``clean energy
technology'' means a technology related to the production, use,
transmission, storage, control, or conservation of energy--
(A) that will contribute to a stabilization of
atmospheric greenhouse gas concentrations thorough
reduction, avoidance, or sequestration of energy-
related emissions and--
(i) reduce the need for additional energy
supplies by using existing energy supplies with
greater efficiency or by transmitting,
distributing, or transporting energy with
greater effectiveness through the
infrastructure of the United States; or
(ii) diversify the sources of energy supply
of the United States to strengthen energy
security and to increase supplies with a
favorable balance of environmental effects if
the entire technology system is considered; and
(B) for which, as determined by the Administrator,
insufficient commercial lending is available at
affordable rates to allow for widespread deployment.
(5) Cost.--The term ``cost'' has the meaning given the term
in section 502 of the Federal Credit Reform Act of 1990 (2
U.S.C. 661a).
(6) Direct loan.--The term ``direct loan'' has the meaning
given the term in section 502 of the Federal Credit Reform Act
of 1990 (2 U.S.C. 661a).
(7) Fund.--The term ``Fund'' means the Clean Energy
Investment Fund established by section 184(a).
(8) Green bonds.--The term ``Green Bonds'' means bonds
issued pursuant to section 184.
(8) Loan guarantee.--The term ``loan guarantee'' has the
meaning given the term in section 502 of the Federal Credit
Reform Act of 1990 (2 U.S.C. 661a).
(9) National laboratory.--The term ``National Laboratory''
has the meaning given the term in section 2 of the Energy
Policy Act of 2005 (42 U.S.C. 15801).
(10) Secretary.--The term ``Secretary'' means the Secretary
of Energy.
(11) 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.
(12) Technology risk.--The term ``technology risk'' means
the risks during construction or operation associated with the
design, development, and deployment of clean energy
technologies (including the cost, schedule, performance,
reliability and maintenance, and accounting for the perceived
risk), from the perspective of commercial lenders, that may be
increased as a result of the absence of adequate historical
construction, operating, or performance data from commercial
applications of the technology.
SEC. 184. CLEAN ENERGY INVESTMENT FUND.
(a) Establishment.--There is established in the Treasury of the
United States a revolving fund, to be known as the ``Clean Energy
Investment Fund'', consisting of--
(1) such amounts as are deposited in the Fund under this
subtitle; and
(2) such sums as may be appropriated to supplement the
Fund.
(b) Authorization of Appropriations.--There are authorized to be
appropriated to the Fund such sums as are necessary to carry out this
subtitle.
(c) Expenditures From Fund.--
(1) In general.--Amounts in the Fund shall be available to
the Administrator of the Administration for obligation without
fiscal year limitation, to remain available until expended.
(2) Administrative expenses.--
(A) Fees.--Fees collected for administrative
expenses shall be available without limitation to cover
applicable expenses.
(B) Fund.--To the extent that administrative
expenses are not reimbursed through fees, an amount not
to exceed 1.5 percent of the amounts in the Fund as of
the beginning of each fiscal year shall be available to
pay the administrative expenses for the fiscal year
necessary to carry out this subtitle.
(d) Transfers of Amounts.--
(1) In general.--The amounts required to be transferred to
the Fund under this section shall be transferred at least
monthly from the general fund of the Treasury to the Fund on
the basis of estimates made by the Secretary of the Treasury.
(2) Adjustments.--Proper adjustment shall be made in
amounts subsequently transferred to the extent prior estimates
were in excess of or less than the amounts required to be
transferred.
(3) Cash flows.--Cash flows associated with costs of the
Fund described in section 502(5)(B) of the Federal Credit
Reform Act of 1990 (2 U.S.C. 661a(5)(B)) shall be transferred
to appropriate credit accounts.
(e) Green Bonds.--
(1) Initial capitalization.--The Secretary of the Treasury
shall issue Green Bonds in the amount of $7,500,000,000 on the
credit of the United States to acquire capital stock of the
Administration. Stock certificates evidencing ownership in the
Administration shall be issued by the Administration to the
Secretary of the Treasury, to the extent of payments made for
the capital stock of the Administration.
(2) Denominations and maturity.--Green Bonds shall be in
such forms and denominations, and shall mature within such
periods, as determined by the Secretary of the Treasury.
(3) Interest.--Green Bonds shall bear interest at a rate
not less than the current average yield on outstanding market
obligations of the United States of comparable maturity during
the month preceding the issuance of the obligation as
determined by the Secretary of the Treasury.
(4) Lawful investments.--Green Bonds shall be lawful
investments, and may be accepted as security for all fiduciary,
trust, and public funds, the investment or deposit of which
shall be under the authority or control of the United States or
any officer or officers thereof.
SEC. 185. ENERGY TECHNOLOGY DEPLOYMENT GOALS.
(a) Goals.--Not later than 1 year after the date of enactment of
this Act, the Secretary, after consultation with the Advisory Council,
shall develop and publish for review and comment in the Federal
Register recommended near-, medium-, and long-term goals (including
numerical performance targets at appropriate intervals to measure
progress toward those goals) for the deployment of clean energy
technologies through the credit support programs established by section
187 to promote--
(1) sufficient electric generating capacity using clean
energy technologies to meet the energy needs of the United
States;
(2) clean energy technologies in vehicles and fuels that
will substantially reduce the reliance of the United States on
foreign sources of energy and insulate consumers from the
volatility of world energy markets;
(3) a domestic commercialization and manufacturing capacity
that will establish the United States as a world leader in
clean energy technologies across multiple sectors;
(4) installation of sufficient infrastructure to allow for
the cost-effective deployment of clean energy technologies
appropriate to each region of the United States;
(5) the transformation of the building stock of the United
States to zero net energy consumption;
(6) the recovery, use, and prevention of waste energy;
(7) domestic manufacturing of clean energy technologies on
a scale that is sufficient to achieve price parity with
conventional energy sources;
(8) domestic production of commodities and materials (such
as steel, chemicals, polymers, and cement) using clean energy
technologies so that the United States will become a world
leader in environmentally sustainable production of the
commodities and materials;
(9) a robust, efficient, and interactive electricity
transmission grid that will allow for the incorporation of
clean energy technologies, distributed generation, and demand-
response in each regional electric grid;
(10) sufficient availability of financial products to allow
owners and users of residential, retail, commercial, and
industrial buildings to make energy efficiency and distributed
generation technology investments with reasonable payback
periods;
(11) sufficient availability of financial services and
support to small businesses developing and deploying clean
energy technologies through partnerships with private entities
that have relevant credit expertise; and
(12) such other goals as the Secretary, in consultation
with the Advisory Council, determines to be consistent with the
purpose stated in section 182.
(b) Revisions.--The Secretary shall revise the goals established
under subsection (a), from time to time as appropriate, to account for
advances in technology and changes in energy policy.
SEC. 186. CLEAN ENERGY DEPLOYMENT ADMINISTRATION.
(a) Establishment.--
(1) Establishment of corporation.--There is established a
corporation to be known as the Clean Energy Deployment
Administration that shall be wholly owned by the United States.
(2) Independent corporation.--The Administration shall be
an independent corporation. Neither the Administration nor any
of its functions, powers, or duties shall be transferred to or
consolidated with any other department, agency, or corporation
of the Government unless the Congress provides otherwise.
(3) Charter.--The Administration shall be chartered for 20
years from the date of enactment of this section.
(4) Status.--
(A) Inspector general.--Section 12 of the Inspector
General Act of 1978 (5 U.S.C. App.) is amended--
(i) in paragraph (1), by inserting ``the
Administrator of the Clean Energy Deployment
Administration;'' after ``Export-Import
Bank;''; and
(ii) in paragraph (2), by inserting ``the
Clean Energy Deployment Administration,'' after
``Export-Import Bank,''.
(3) Offices.--
(A) Principal office.--The Administration shall--
(i) maintain the principal office of the
Administration in the national capital region;
and
(ii) for purposes of venue in civil
actions, be considered to be a resident of the
District of Columbia.
(B) Other offices.--The Administration may
establish other offices in such other places as the
Administration considers necessary or appropriate for
the conduct of the business of the Administration.
(b) Administrator.--
(1) In general.--The Administrator of the Administration
shall be--
(A) appointed by the President, with the advice and
consent of the Senate, for a 5-year term; and
(B) compensated at the prevailing rate for
compensation for similar positions in industry.
(2) Duties.--The Administrator of the Administration
shall--
(A) serve as the Chief Executive Officer of the
Administration and Chairman of the Board;
(B) ensure that--
(i) the Administration operates in a safe
and sound manner, including maintenance of
adequate capital and internal controls
(consistent with section 404 of the Sarbanes-
Oxley Act of 2002 (15 U.S.C. 7262));
(ii) the operations and activities of the
Administration foster liquid, efficient,
competitive, and resilient energy and energy
efficiency finance markets;
(iii) the Administration carries out the
purpose stated in section 182 only through
activities that are authorized under and
consistent with sections 182 through 189; and
(iv) the activities of the Administration
and the manner in which the Administration is
operated are consistent with the public
interest;
(C) develop policies and procedures for the
Administration that will--
(i) promote a self-sustaining portfolio of
investments that will maximize the value of
investments to effectively promote clean energy
technologies;
(ii) promote transparency and openness in
Administration operations;
(iii) afford the Administration with
sufficient flexibility to meet the purpose
stated in section 182; and
(iv) provide for the efficient processing
of applications; and
(D) with the concurrence of the Board, set expected
loss reserves for the support provided by the
Administration consistent with section 187(c).
(c) Board of Directors.--
(1) In general.--The Board of Directors of the
Administration shall consist of--
(A) the Secretary or the designee of the Secretary,
who shall serve as an ex-officio member of the Board of
Directors;
(B) the Secretary of the Treasury or the designee
of the Secretary, who shall serve as an ex-officio
member of the Board of Directors;
(C) the Secretary of the Interior or the designee
of the Secretary, who shall serve as an ex-officio
member of the Board of Directors;
(D) the Secretary of Agriculture or the designee of
the Secretary, who shall serve as an ex officio member
of the Board of Directors;
(E) the Administrator of the Administration, who
shall serve as the Chairman of the Board of Directors;
and
(F) 4 additional members who shall--
(i) be appointed by the President, with the
advice and consent of the Senate, for staggered
5-year terms; and
(ii) have experience in banking, financial
services, technology assessment, energy
regulation, or risk management, including
individuals with substantial experience in the
development of energy projects, the electricity
generation sector, the transportation sector,
the manufacturing sector, and the energy
efficiency sector.
(2) Duties.--The Board of Directors shall--
(A) oversee the operations of the Administration
and ensure industry best practices are followed in all
financial transactions involving the Administration;
(B) consult with the Administrator of the
Administration on the general policies and procedures
of the Administration to ensure the interests of the
taxpayers are protected;
(C) ensure the portfolio of investments are
consistent with purpose stated in section 182 and with
the long-term financial stability of the
Administration;
(D) ensure that the operations and activities of
the Administration are consistent with the development
of a robust private sector that can provide commercial
loans or financing products; and
(E) not serve on a full-time basis, except that the
Board of Directors shall meet at least quarterly to
review, as appropriate, applications for credit support
and set policies and procedures as necessary.
(3) Removal.--An appointed member of the Board of Directors
may be removed from office by the President for good cause.
(4) Vacancies.--An appointed seat on the Board of Directors
that becomes vacant shall be filled by appointment by the
President, but only for the unexpired portion of the term of
the vacating member.
(5) Compensation of members.--An appointed member of the
Board of Directors shall be compensated at the prevailing rate
for compensation for similar positions in industry.
(d) Energy Technology Advisory Council.--
(1) In general.--The Administration shall have an Energy
Technology Advisory Council consisting of 8 members selected by
the Board of Directors of the Administration.
(2) Qualifications.--The members of the Advisory Council
shall--
(A) have clean energy project development, clean
energy finance, commercial, and/or relevant scientific
expertise; and
(B) include representatives of--
(i) the academic community;
(ii) the private research community;
(iii) National Laboratories;
(iv) the technology or project development
community; and
(v) the commercial energy financing and
operations sector.
(3) Duties.--The Advisory Council shall--
(A) develop and publish for comment in the Federal
Register a methodology for assessment of clean energy
technologies that will allow the Administration to
evaluate projects based on the progress likely to be
achieved per-dollar invested in maximizing the
attributes of the definition of clean energy
technology, taking into account the extent to which
support for a clean energy technology is likely to
accrue subsequent benefits that are attributable to a
commercial scale deployment taking place earlier than
that which otherwise would have occurred without the
support; and
(B) advise on the technological approaches that
should be supported by the Administration to meet the
technology deployment goals established by the
Secretary pursuant to section 185.
(4) Term.--
(A) In general.--Members of the Advisory Council
shall have 5-year staggered terms, as determined by the
Administrator of the Administration.
(B) Reappointment.--A member of the Advisory
Council may be reappointed.
(5) Compensation.--A member of the Advisory Council, who is
not otherwise compensated as a Federal employee, shall be
compensated at a rate equal to the daily equivalent of the
annual rate of basic pay prescribed for level IV of the
Executive Schedule under section 5315 of title 5, United States
Code, for each day (including travel time) during which the
member is engaged in the performance of the duties of the
Advisory Council.
(e) Staff.--
(1) In general.--The Administrator of the Administration,
in consultation with the Board of Directors, may--
(A) appoint and terminate such officers, attorneys,
employees, and agents as are necessary to carry out
this subtitle; and
(B) vest those personnel with such powers and
duties as the Administrator of the Administration may
determine.
(f) Conflicts of Interest.--No director, officer, attorney, agent,
or employee of the Administration shall in any manner, directly or
indirectly, participate in the deliberation upon, or the determination
of, any question affecting such individual's personal interests, or the
interests of any corporation, partnership, or association in which such
individual is directly or indirectly personally interested.
(g) Sunset.--
(1) Expiration of charter.--The Administration shall
continue to exercise its functions until all obligations and
commitments of the Administration are discharged, even after
its charter has expired.
(2) Prior obligations.--No provisions of this subsection
shall be construed as preventing the Administration from--
(A) undertaking obligations prior to the date of
the expiration of its charter which mature subsequent
to such date;
(B) assuming, prior to the date of the expiration
of its charter, liability as guarantor, endorser, or
acceptor of obligations which mature subsequent to such
date; or
(C) continuing as a corporation and exercising any
of its functions subsequent to the date of the
expiration of its charter for purposes of orderly
liquidation, including the administration of its assets
and the collection of any obligations held by the
Administration.
SEC. 187. DIRECT SUPPORT.
(a) In General.--The Administration may issue direct loans, letters
of credit, and loan guarantees to deploy clean energy technologies if
the Administrator of the Administration has determined that deployment
of the technologies would benefit or be accelerated by the support.
(b) Eligibility Criteria.--In carrying out this section and
awarding credit support to projects, the Administrator of the
Administration shall account for--
(1) how the technology rates based on an evaluation
methodology established by the Advisory Council;
(2) how the project fits with the goals established under
section 185; and
(3) the potential for the applicant to successfully
complete the project.
(c) Risk.--
(1) Expected loan loss reserve.--The Administrator of the
Administration shall establish an expected loan loss reserve to
account for estimated losses attributable to activities under
this section that is consistent with the purposes of--
(A) developing breakthrough technologies to the
point at which technology risk is largely mitigated;
(B) achieving widespread deployment and advancing
the commercial viability of clean energy technologies;
and
(C) advancing the goals established under section
185.
(2) Initial expected loan loss reserve.--Until such time as
the Administrator of the Administration determines sufficient
data exist to establish an expected loan loss reserve that is
appropriate, the Administrator of the Administration shall
consider establishing an initial rate of 10 percent for the
portfolio of investments under this subtitle.
(3) Portfolio investment approach.--The Administration
shall--
(A) use a portfolio investment approach to mitigate
risk and diversify investments across technologies and
ensure that no particular technology is provided more
than 30 percent of the financial support available;
(B) to the maximum extent practicable and
consistent with long-term self-sufficiency, weigh the
portfolio of investments in projects to advance the
goals established under section 185;
(C) consistent with the expected loan loss reserve
established under this subsection, the purpose stated
in section 182, and section 186(b)(2)(B), provide the
maximum practicable percentage of support to promote
breakthrough technologies; and
(D) give the highest priority to investments that
promote technologies that will achieve the maximum
greenhouse gas emission reductions within a reasonable
period of time per dollar invested and the earliest
reductions in greenhouse gas emissions.
(4) Loss rate review.--
(A) In general.--The Board of Directors shall
review on an annual basis the loss rates of the
portfolio to determine the adequacy of the reserves.
(B) Report.--Not later than 90 days after the date
of the initiation of the review, the Administrator of
the Administration shall submit to the Committee on
Energy and Natural Resources and the Committee on
Finance of the Senate, and the Committee on Energy and
Commerce and the Committee on Ways and Means of the
House of Representatives a report describing the
results of the review and any recommended policy
changes.
(5) Federal cost share.--Direct loans, letters of credit
and loan guarantees by the Administration shall not exceed an
amount equal to 80 percent of the project cost of the facility
that is the subject of the loan, letter of credit or loan
guarantee, as estimated at the time at which the loan, letter
of credit or loan guarantee is issued.
(d) Application Review.--
(1) In general.--To the maximum extent practicable and
consistent with sound business practices, the Administration
shall seek to consolidate reviews of applications for credit
support under this subtitle such that final decisions on
applications can generally be issued not later than 180 days
after the date of submission of a completed application.
(2) Environmental review.--In carrying out this subtitle,
the Administration shall, to the maximum extent practicable--
(A) avoid duplicating efforts that have already
been undertaken by other agencies (including State
agencies acting under Federal programs); and
(B) with the advice of the Council on Environmental
Quality and any other applicable agencies, use the
administrative records of similar reviews conducted
throughout the executive branch to develop the most
expeditious review process practicable.
(e) Wage Rate Requirements.--
(1) In general.--No credit support shall be issued under
this section unless the borrower has provided to the
Administrator of the Administration reasonable assurances that
all laborers and mechanics employed by contractors and
subcontractors in the performance of construction work financed
in whole or in part by the Administration will be paid wages at
rates not less than those prevailing on projects of a character
similar to the contract work in the civil subdivision of the
State in which the contract work is to be performed as
determined by the Secretary of Labor in accordance with
subchapter IV of chapter 31 of part A of subtitle II of title
40, United States Code.
(2) Labor standards.--With respect to the labor standards
specified in this subsection, the Secretary of Labor shall have
the authority and functions set forth in Reorganization Plan
Numbered 14 of 1950 (64 Stat. 1267; 5 U.S.C. App.) and section
3145 of title 40, United States Code.
(f) Limitations.--(1) The Administration shall not provide direct
support as defined under this section or indirect support as defined
under section 188 to an individual clean energy technology project that
obtained a loan guarantee under title XVII of the Energy Policy Act of
2005.
(2) No direct or indirect support provided by the Administration
may be used to pay any part of the cost of an obligation or a loan
guarantee under title XVII of the Energy Policy Act of 2005.
SEC. 188. INDIRECT SUPPORT.
(a) In General.--For the purpose of enhancing the availability of
private financing for clean energy technology deployment, the
Administration may--
(1) provide credit support to portfolios of taxable debt
obligations originated by state, local, and private sector
entities that enable owners and users of buildings and
industrial facilities to--
(A) significantly increase the energy efficiency of
such buildings or facilities; or
(B) install systems that individually generate
electricity from renewable energy resources and have a
capacity of no more than 2 megawatts;
(2) facilitate financing transactions in tax equity markets
and long-term purchasing of clean energy by state, local, and
non-governmental not-for-profit entities, to the degree and
extent that the Administration determines such financing
activity is appropriate and consistent with carrying out the
purposes described in Section 182 of this Act; and
(3) provide credit support to portfolios of taxable debt
obligations originated by state, local, and private sector
entities that enable the deployment of energy storage
applications for electric drive vehicles, stationary
applications, and electricity transmission and distribution.
(b) Definitions.--For purposes of the section:
(1) Credit support.--The term ``credit support'' means--
(A) direct loans, letters of credit, loan
guarantees, and insurance products; and
(B) the purchase or commitment to purchase, or the
sale or commitment to sell, debt instruments (including
subordinated securities).
(2) Renewable energy resource.--The term ``renewable energy
resource'' shall have the meaning given that term in section
610 of the Public Utility Regulatory Policies Act of 1978 (as
added by section 101 of this Act).
(c) Transparency.--The Administration shall seek to foster through
its credit support activities--
(1) the development and consistent application of standard
contractual terms, transparent underwriting standards and
consistent measurement and verification protocols, as
applicable; and
(2) the creation of performance data that promotes
effective underwriting and risk management to support lending
markets and stimulate the development of private investment
markets.
(d) Exempt Securities.--All securities insured or guaranteed by the
Administration shall, to the same extent as securities that are direct
obligations of or obligations guaranteed as to the principal or
interest by the United States, be considered to be exempt securities
within the meaning of the laws administered by the Securities and
Exchange Commission.
SEC. 189. FEDERAL CREDIT AUTHORITY.
(a) Payments of Liabilities.--
(1) In general.--Any payment made to discharge liabilities
arising from agreements under this subtitle shall be paid
exclusively out of the Fund or the associated credit account,
as appropriate.
(2) Security.--Subject to paragraph (1), the full faith and
credit of the United States is pledged to the payment of all
obligations entered into by the Administration pursuant to this
subtitle.
(b) Fees.--
(1) In general.--Consistent with achieving the purpose
stated in section 182, the Administrator of the Administration
shall charge fees or collect compensation generally in
accordance with commercial rates.
(2) Availability of fees.--All fees collected by the
Administration may be retained by the Administration and placed
in the Fund and may remain available to the Administration,
without further appropriation or fiscal year limitation, for
use in carrying out the purpose stated in section 182.
(3) Breakthrough technologies.--The Administration shall
charge the minimum amount in fees or compensation practicable
for breakthrough technologies, consistent with the long-term
viability of the Administration, unless the Administration
first determines that a higher charge will not impede the
development of the technology.
(4) Alternative fee arrangements.--The Administration may
use such alternative arrangements (such as profit
participation, contingent fees, and other valuable contingent
interests) as the Administration considers appropriate to
compensate the Administration for the expenses of the
Administration and the risk inherent in the support of the
Administration.
(c) Cost Transfer Authority.--Amounts collected by the
Administration for the cost of a loan or loan guarantee shall be
transferred by the Administration to the respective credit accounts.
SEC. 190. GENERAL PROVISIONS.
(a) Immunity From Impairment, Limitation, or Restriction.--
(1) In general.--All rights and remedies of the
Administration (including any rights and remedies of the
Administration on, under, or with respect to any mortgage or
any obligation secured by a mortgage) shall be immune from
impairment, limitation, or restriction by or under--
(A) any law (other than a law enacted by Congress
expressly in limitation of this paragraph) that becomes
effective after the acquisition by the Administration
of the subject or property on, under, or with respect
to which the right or remedy arises or exists or would
so arise or exist in the absence of the law; or
(B) any administrative or other action that becomes
effective after the acquisition.
(2) State law.--The Administrator of the Administration may
conduct the business of the Administration without regard to
any qualification or law of any State relating to
incorporation.
(b) Use of Other Agencies.--With the consent of a department,
establishment, or instrumentality (including any field office), the
Administration may--
(1) use and act through any department, establishment, or
instrumentality; and
(2) use, and pay compensation for, information, services,
facilities, and personnel of the department, establishment, or
instrumentality.
(c) Financial Matters.--
(1) Investments.--Funds of the Administration may be
invested in such investments as the Board of Directors may
prescribe. Earnings from such funds, other than fees collected
under section 189, may be spent by the Administration only to
such extent or in such amounts as are provided in advance by
appropriation Acts.
(2) Fiscal agents.--Any Federal Reserve bank or any bank as
to which at the time of the designation of the bank by the
Administrator of the Administration there is outstanding a
designation by the Secretary of the Treasury as a general or
other depository of public money, may be designated by the
Administrator of the Administration as a depositary or
custodian or as a fiscal or other agent of the Administration.
(d) Periodic Reports.--Not later than 1 year after commencement of
operation of the Administration and at least biannually thereafter, the
Administrator of the Administration shall submit to the Committee on
Energy and Natural Resources and the Committee on Finance of the Senate
and the Committee on Energy and Commerce and the Committee on Ways and
Means of the House of Representatives a report that includes a
description of--
(1) the technologies supported by activities of the
Administration and how the activities advance the purpose
stated in section 182; and
(2) the performance of the Administration on meeting the
goals established under section 185.
(g) Audits by the Comptroller General.--
(1) In general.--The programs, activities, receipts,
expenditures, and financial transactions of the Administration
shall be subject to audit by the Comptroller General of the
United States under such rules and regulations as may be
prescribed by the Comptroller General.
(2) Access.--The representatives of the Government
Accountability Office shall--
(A) have access to the personnel and to all books,
accounts, documents, records (including electronic
records), reports, files, and all other papers,
automated data, things, or property belonging to, under
the control of, or in use by the Administration, or any
agent, representative, attorney, advisor, or consultant
retained by the Administration, and necessary to
facilitate the audit;
(B) be afforded full facilities for verifying
transactions with the balances or securities held by
depositories, fiscal agents, and custodians;
(C) be authorized to obtain and duplicate any such
books, accounts, documents, records, working papers,
automated data and files, or other information relevant
to the audit without cost to the Comptroller General;
and
(D) have the right of access of the Comptroller
General to such information pursuant to section 716(c)
of title 31, United States Code.
(3) Assistance and cost.--
(A) In general.--For the purpose of conducting an
audit under this subsection, the Comptroller General
may, in the discretion of the Comptroller General,
employ by contract, without regard to section 3709 of
the Revised Statutes (41 U.S.C. 5), professional
services of firms and organizations of certified public
accountants for temporary periods or for special
purposes.
(B) Reimbursement.--
(i) In general.--On the request of the
Comptroller General, the Administration shall
reimburse the Government Accountability Office
for the full cost of any audit conducted by the
Comptroller General under this subsection.
(ii) Crediting.--Such reimbursements
shall--
(I) be credited to the
appropriation account entitled
``Salaries and Expenses, Government
Accountability Office'' at the time at
which the payment is received; and
(II) remain available until
expended.
(h) Annual Independent Audits.--
(1) In general.--The Administrator of the Administration
shall--
(A) have an annual independent audit made of the
financial statements of the Administration by an
independent public accountant in accordance with
generally accepted auditing standards; and
(B) submit to the Secretary and to the Committee on
Energy and Natural Resources and the Committee on
Finance of the Senate and the Committee on Energy and
Commerce and the Committee on Ways and Means of the
House the results of the audit.
(2) Content.--In conducting an audit under this subsection,
the independent public accountant shall determine and report on
whether the financial statements of the Administration--
(A) are presented fairly in accordance with
generally accepted accounting principles; and
(B) comply with any disclosure requirements imposed
under this subtitle.
(i) Financial Reports.--
(1) In general.--The Administrator of the Administration
shall submit to the Secretary and to the Committee on Energy
and Natural Resources and the Committee on Finance of the
Senate and the Committee on Energy and Commerce and the
Committee on Ways and Means of the House annual and quarterly
reports of the financial condition and operations of the
Administration, which shall be in such form, contain such
information, and be submitted on such dates as the Secretary
shall require.
(2) Contents of annual reports.--Each annual report shall
include--
(A) financial statements prepared in accordance
with generally accepted accounting principles;
(B) any supplemental information or alternative
presentation that the Secretary may require; and
(C) an assessment (as of the end of the most recent
fiscal year of the Administration), signed by the chief
executive officer and chief accounting or financial
officer of the Administration, of--
(i) the effectiveness of the internal
control structure and procedures of the
Administration; and
(ii) the compliance of the Administration
with applicable safety and soundness laws.
(3) Special reports.--The Secretary may require the
Administrator of the Administration to submit other reports on
the condition (including financial condition), management,
activities, or operations of the Administration, as the
Secretary considers appropriate.
(4) Accuracy.--Each report of financial condition shall
contain a declaration by the Administrator of the
Administration or any other officer designated by the Board of
Directors of the Administration to make the declaration, that
the report is true and correct to the best of the knowledge and
belief of the officer.
(5) Availability of reports.--Reports required under this
section shall be published and made publicly available as soon
as is practicable after receipt by the Secretary.
(j) Spending Safeguards and Reporting.--
(1) In general.--The Administrator--
(A) shall require any entity receiving financing
support from the Administration to report quarterly, in
a format specified by the Administrator, on such
entity's use of such support and its progress
fulfilling the objectives for which such support was
granted, and the Administrator shall make these reports
available to the public;
(B) may establish additional reporting and
information requirements for any recipient of financing
support from the Administration;
(C) shall establish appropriate mechanisms to
ensure appropriate use and compliance with all terms of
any financing support from the Administration;
(D) shall create and maintain a fully searchable
database, accessible on the Internet (or successor
protocol) at no cost to the public, that contains at
least--
(i) a list of each entity that has applied
for financing support;
(ii) a description of each application;
(iii) the status of each such application;
(iv) the name of each entity receiving
financing support;
(v) the purpose for which such entity is
receiving such financing support;
(vi) each quarterly report submitted by the
entity pursuant to this section; and
(vii) such other information sufficient to
allow the public to understand and monitor the
financial support provided by the
Administration;
(E) shall make all financing transactions available
for public inspection, including formal annual reviews
by both a private auditor and the Comptroller General;
and
(F) shall at all times be available to receive
public comment in writing on the activities of the
Administration.
(2) Protection of confidential business information.--To
the extent necessary and appropriate, the Administrator may
redact any information regarding applicants and borrowers to
protect confidential business information.
SEC. 191. CONFORMING AMENDMENTS.
(a) Tax Exempt Status.--Subsection (l) of section 501 of the
Internal Revenue Code of 1986 is amended by adding at the end the
following:
``(4) The Clean Energy Deployment Administration
established under section 186 of the American Clean Energy and
Security Act of 2009.''.
(b) Wholly Owned Government Corporation.--Paragraph (3) of section
9101 of title 31, United States Code, is amended by adding at the end
the following:
``(S) the Clean Energy Deployment
Administration.''.
Subtitle J--Miscellaneous
SEC. 195. INCREASED HYDROELECTRIC GENERATION AT EXISTING FEDERAL
FACILITIES.
(a) In General.--The Secretary of the Interior, the Secretary of
Energy, and the Secretary of the Army shall jointly update the study of
the potential for increasing electric power production capability at
federally owned or operated water regulation, storage, and conveyance
facilities required in section 1834 of the Energy Policy Act of 2005.
(b) Content.--The update under this section shall include
identification and description in detail of each facility that is
capable, with or without modification, of producing additional
hydroelectric power, including estimation of the existing potential for
the facility to generate hydroelectric power.
(c) Report.--The Secretaries shall submit to the Committees on
Energy and Commerce, Natural Resources, and Transportation and
Infrastructure of the House of Representatives and the Committee on
Energy and Natural Resources of the Senate a report on the findings,
conclusions, and recommendations of the update of the study under this
section by not later than 12 months after the date of enactment of this
Act. The report shall include each of the following:
(1) The identifications, descriptions, and estimations
referred to in subsection (b).
(2) A description of activities currently conducted or
considered, or that could be considered, to produce additional
hydroelectric power from each identified facility.
(3) A summary of prior actions taken by the Secretaries to
produce additional hydroelectric power from each identified
facility.
(4) The costs to install, upgrade, or modify equipment or
take other actions to produce additional hydroelectric power
from each identified facility, and the level of Federal power
customer involvement in the determination of such costs.
(5) The benefits that would be achieved by such
installation, upgrade, modification, or other action, including
quantified estimates of any additional energy or capacity from
each facility identified under subsection (b).
(6) A description of actions that are planned, underway, or
might reasonably be considered to increase hydroelectric power
production by replacing turbine runners, by performing
generator upgrades or rewinds, or by construction of pumped
storage facilities.
(7) The impact of increased hydroelectric power production
on irrigation, water supply, fish, wildlife, Indian tribes,
river health, water quality, navigation, recreation, fishing,
and flood control.
(8) Any additional recommendations to increase
hydroelectric power production from, and reduce costs and
improve efficiency at, federally owned or operated water
regulation, storage, and conveyance facilities.
SEC. 196. CLEAN TECHNOLOGY BUSINESS COMPETITION GRANT PROGRAM.
(a) In General.--The Secretary of Energy is authorized to provide
grants to organizations to conduct business competitions that provide
incentives, training, and mentorship to entrepreneurs, including
minority-owned and woman-owned, and early stage start-up companies
throughout the United States to meet high priority economic,
environmental, and energy security goals in areas to include energy
efficiency, renewable energy, air quality, water quality and
conservation, transportation, smart grid, green building, and waste
management. Such competitions shall have the purpose of accelerating
the development and deployment of clean technology businesses and green
jobs; stimulating green economic development; providing business
training and mentoring to early stage clean technology companies; and
strengthening the competitiveness of United States clean technology
industry in world trade markets. Priority shall be given to business
competitions that are private sector led, encourage regional and
interregional cooperation, and can demonstrate market-driven practices
and show the creation of cost-effective green jobs through an annual
publication of competition activities and directory of companies.
(b) Eligibility.--An organization eligible for a grant under
subsection (a) is--
(1) any organization described in section 501(c)(3) of the
Internal Revenue Code of 1986 and exempt from tax under section
501(a) of such Code; and
(2) any sponsored entity of an organization described in
paragraph (1) that is operated as a nonprofit entity.
(c) Priority.--In making grants under this section, the Secretary
shall give priority to those organizations that can demonstrate broad
funding support from private and other non-Federal funding sources to
leverage Federal investment.
(d) Authorization of Appropriations.--For the purpose of carrying
out this section, there are authorized to be appropriated $20,000,000.
SEC. 197. NATIONAL BIOENERGY PARTNERSHIP.
(a) In General.--The Secretary of Energy shall establish a National
Bioenergy Partnership to provide coordination among programs of State
governments, the Federal Government, and the private sector that
support the institutional and physical infrastructure necessary to
promote the deployment of sustainable biomass fuels and bioenergy
technologies for the United States.
(b) Program.--The National Bioenergy Partnership shall consist of
five regions, to be administered by the CONEG Policy Research Center,
the Council of Great Lakes Governors, the Southern States Energy Board,
the Western Governors Association, and the Pacific Regional Biomass
Energy Partnership led by the Washington State University Energy
Program.
(c) Authorization of Appropriations.--There are authorized to be
appropriated for each of fiscal years 2010 through 2014 to carry out
this section--
(1) $5,000,000, to be allocated among the 5 regions
described in subsection (b) on the basis of the number of
States in each region, for distribution among the member States
of that region based on procedures developed by the member
States of the region; and
(2) $2,500,000, to be allocated equally among the 5 regions
described in subsection (b) for region-wide activities,
including technical assistance and regional studies and
coordination.
SEC. 198. OFFICE OF CONSUMER ADVOCACY.
Section 319 of the Federal Power Act is amended to read as follows:
``SEC. 319. OFFICE OF CONSUMER ADVOCACY.
``(a) Office.--
``(1) Establishment.--There is established within the
Commission an Office of Consumer Advocacy to serve as an
advocate for the public interest. The Office of Administrative
Litigation within the Commission shall be incorporated into the
Office of Consumer Advocacy.
``(2) Director.--The Office shall be headed by a Director
to be appointed by the President by and with the advice and
consent of the Senate from among individuals who are licensed
attorneys admitted to the Bar of any State or of the District
of Columbia and who have experience in public utility
proceedings.
``(3) Duties.--The Office may--
``(A) represent the interests of energy customers--
``(i) on matters before the Commission
concerning rates or service of public utilities
and natural gas companies under the
jurisdiction of the Commission;
``(ii) as amicus curiae, in the review in
the courts of the United States of rulings by
the Commission in such matters; and
``(iii) as amicus, in hearings and
proceedings in other Federal regulatory
agencies and commissions related to such
matters;
``(B) monitor and review energy customer complaints
and grievances on matters concerning rates or service
of public utilities and natural gas companies under the
jurisdiction of the Commission;
``(C) investigate independently, or within the
context of formal proceedings, the services provided
by, the rates charged by, and the valuation of the
properties of, public utilities and natural gas
companies under the jurisdiction of the Commission;
``(D) develop means, such as public dissemination
of information, consultative services, and technical
assistance, to ensure, to the maximum extent
practicable, that the interests of energy consumers are
adequately represented in the course of any hearing or
proceeding described in subparagraph (A);
``(E) collect data concerning rates or service of
public utilities and natural gas companies under the
jurisdiction of the Commission; and
``(F) prepare and issue reports and
recommendations.
``(4) Compensation and powers.--The Director shall be
compensated at Level IV of the Executive Schedule. The Director
may--
``(A) employ not more than 25 full-time
professional employees at appropriate levels in the GS
Scale and such additional support personnel as
required; and
``(B) procure temporary and intermittent services
as needed.
``(5) Information from other federal agencies.--The
Director may request, from any department, agency, or
instrumentality of the United States such information as he
deems necessary to carry out his functions under this section.
Upon such request, the head of the department, agency, or
instrumentality concerned shall, to the extent practicable and
authorized by law, provide such information to the Office.
``(b) Consumer Advocacy Advisory Committee.--
``(1) Establishment.--The Director shall establish an
advisory committee to be known as Consumer Advocacy Advisory
Committee (in this section referred to as the `Advisory
Committee') to review rates, services, and disputes and to make
recommendations to the Director.
``(2) Composition.--The Director shall appoint 5 members to
the Advisory Committee including--
``(A) 2 individuals representing State utility
consumer advocates; and
``(B) 1 individual, from a nongovernmental
organization representing consumers.
``(3) Meetings.--The Advisory Committee shall meet at such
frequency as may be required to carry out its duties.
``(4) Reports.--The Director shall provide for the
publication of recommendations of the Advisory Committee on the
public website established for the Office.
``(5) Duration.--Notwithstanding any other provision of
law, the Advisory Committee shall continue in operation during
the period for which the Office exists.
``(c) Definitions.--
``(1) Energy customer.--The term `energy customer' means a
residential customer or a small commercial customer that
receives products or services directly or indirectly from a
public utility or natural gas company under the jurisdiction of
the Commission.
``(2) Natural gas company.--The term `natural gas company'
has the meaning given the term in section 2 of the Natural Gas
Act (15 U.S.C. 717a), as modified by section 601(a) of the
Natural Gas Policy Act of 1978 (15 U.S.C. 3431(a)).
``(3) Office.--The term `Office' means the Office of
Consumer Advocacy established under this section.
``(4) Public utility.--The term `public utility' has the
meaning given the term in section 201(e) of this Act.
``(5) Small commercial customer.--The term `small
commercial customer' means a commercial customer that has a
peak demand of not more than 1,000 kilowatts per hour.
``(d) Authorization of Appropriations.--There are authorized to be
appropriated such sums as necessary to carry out this section.
``(e) Savings Clause.--Nothing in this section affects the rights
or obligations of any State utility consumer advocate.''.
SEC. 199. DEVELOPMENT CORPORATION FOR RENEWABLE POWER BORROWING
AUTHORITY.
(a) Determination.--No later than 6 months after the date of
enactment of this Act, the Secretary of Energy, in coordination with
the Secretary of Commerce, shall--
(1) determine any geographic area within the contiguous
United States that lacks a Federal power marketing agency;
(2) develop a plan or criteria for the geographic areas
identified in paragraph (1) regarding investment in renewable
energy and associated infrastructure within an area identified
in paragraph (1); and
(3) identify any Federal agency within an area in paragraph
(1) that has, or could develop, the ability to facilitate the
investment in paragraph (2).
(b) Report.--The Secretary of Energy, in coordination with the
Secretary of Commerce, shall provide the determinations made under
subsection (a) to the Committee on Energy and Commerce of the House of
Representatives.
(c) Establishment.--Based upon the determinations made pursuant to
subsection (a), the Secretary of Energy, in coordination with the
Secretary of Commerce, shall recommend to the Committee on Energy and
Commerce of the House of Representatives the establishment of any new
Federal lending authority, including authorization of additional
lending authority for existing Federal agencies, not to exceed
$3,500,000,000 per geographic area identified in subsection (a)(1).
(d) Authorization.--$25,000,000 is authorized to be appropriated
for fiscal year 2010 to carry out the provisions of this section.
SEC. 199A. STUDY.
Not later than February 1, 2011, the Secretary of Energy shall
transmit to the Congress a report showing the results of a study on the
use of thorium-fueled nuclear reactors for national energy needs. Such
report shall include a response to the International Atomic Energy
Agency study entitled ``Thorium fuel cycle - Potential benefits and
challenges'' (IAEA-TECDOC-1450).
TITLE II--ENERGY EFFICIENCY
Subtitle A--Building Energy Efficiency Programs
SEC. 201. GREATER ENERGY EFFICIENCY IN BUILDING CODES.
Section 304 of the Energy Conservation and Production Act (42
U.S.C. 6833) is amended to read as follows:
``SEC. 304. GREATER ENERGY EFFICIENCY IN BUILDING CODES.
``(a) Energy Efficiency Targets.--
``(1) In general.--Except as provided in paragraph (2) or
(3), the national building code energy efficiency target for
the national average percentage improvement of a building's
energy performance when built to a code meeting the target
shall be--
``(A) effective on the date of enactment of the
American Clean Energy and Security Act of 2009, 30
percent reduction in energy use relative to a
comparable building constructed in compliance with the
baseline code;
``(B) effective January 1, 2014, for residential
buildings, and January 1, 2015, for commercial
buildings, 50 percent reduction in energy use relative
to the baseline code; and
``(C) effective January 1, 2017, for residential
buildings, and January 1, 2018, for commercial
buildings, and every 3 years thereafter, respectively,
through January 1, 2029, and January 1, 2030, 5 percent
additional reduction in energy use relative to the
baseline code.
``(2) Consensus-based codes.--If on any effective date
specified in paragraph (1)(A), (B), or (C) a successor code to
the baseline codes provides for greater reduction in energy use
than is required under paragraph (1), the overall percentage
reduction in energy use provided by that successor code shall
be the national building code energy efficiency target.
``(3) Targets established by secretary.--The Secretary may
by rule establish a national building code energy efficiency
target for residential or commercial buildings achieving
greater reductions in energy use than the targets prescribed in
paragraph (1) or (2) if the Secretary determines that such
greater reductions in energy use can be achieved with a code
that is life cycle cost-justified and technically feasible. The
Secretary may by rule establish a national building code energy
efficiency target for residential or commercial buildings
achieving a reduction in energy use that is greater than zero
but less than the targets prescribed in paragraph (1) or (2) if
the Secretary determines that such lesser target is the maximum
reduction in energy use that can be achieved through a code
that is life cycle cost-justified and technically feasible.
``(4) Additional reductions in energy use.--Effective on
January 1, 2033, and once every 3 years thereafter, the
Secretary shall determine, after notice and opportunity for
comment, whether further energy efficiency building code
improvements for residential or commercial buildings,
respectively, are life cycle cost-justified and technically
feasible, and shall establish updated national building code
energy efficiency targets that meet such criteria.
``(5) Zero-net-energy buildings.--In setting targets under
this subsection, the Secretary shall consider ways to support
the deployment of distributed renewable energy technology, and
shall seek to achieve the goal of zero-net-energy commercial
buildings established in section 422 of the Energy Independence
and Security Act of 2007 (42 U.S.C. 17082).
``(6) Baseline code.--For purposes of this section, the
term `baseline code' means--
``(A) for residential buildings, the 2006
International Energy Conservation Code (IECC) published
by the International Code Council (ICC); and
``(B) for commercial buildings, the code published
in ASHRAE Standard 90.1-2004.
``(7) Consultation.--In establishing the targets required
by this section, the Secretary shall consult with the Director
of the National Institute of Standards and Technology.
``(b) National Energy Efficiency Building Codes.--
``(1) Requirement.--
``(A) In general.--There shall be established
national energy efficiency building codes under this
subsection, for residential and commercial buildings,
sufficient to meet each of the national building code
energy efficiency targets established under subsection
(a), not later than the date that is 1 year after the
deadline for establishment of each such target, except
that the national energy efficiency building code
established to meet the target described in subsection
(a)(1)(A) shall be established by not later than 15
months after the effective date of that target.
``(B) Existing code.--If the Secretary finds prior
to the date provided in subparagraph (A) for
establishing a national code for any target that one or
more energy efficiency building codes published by a
recognized developer of national energy codes and
standards meet or exceed the established target, the
Secretary shall select the code that meets the target
with the highest efficiency in the most cost-effective
manner, and such code shall be the national energy
efficiency building code.
``(C) Requirement to establish code.--If the
Secretary does not make a finding under subparagraph
(B), the national energy efficiency building code shall
be established by rule by the Secretary under paragraph
(2).
``(2) Establishment by secretary.--
``(A) Procedure.--In order to establish a national
energy efficiency building code as required under
paragraph (1)(C), the Secretary shall--
``(i) not later than 6 months prior to the
effective date for each target, review existing
and proposed codes published or under review by
recognized developers of national energy codes
and standards;
``(ii) determine the percentage of energy
efficiency improvements that are or would be
achieved in such published or proposed code
versions relative to the target;
``(iii) propose improvements to such
published or proposed code versions sufficient
to meet or exceed the target; and
``(iv) unless a finding is made under
paragraph (1)(B) with respect to a code
published by a recognized developer of national
energy codes and standards, adopt a code that
meets or exceeds the relevant national building
code energy efficiency target by not later than
1 year after the effective date of each such
target, and by not later than 15 months after
the target is established under subsection
(a)(1)(A).
``(B) Calculations.--Each national energy
efficiency building code established by the Secretary
under this paragraph shall be set at the maximum level
the Secretary determines is life cycle cost-justified
and technically feasible, in accordance with the
following:
``(i) Savings calculations.--Calculations
of energy savings shall take into account the
typical lifetimes of different products,
measures, and system configurations.
``(ii) Cost-effectiveness calculations.--
Calculations of life cycle cost-effectiveness
shall be based on life cycle cost methods and
procedures under section 544 of the National
Energy Conservation Policy Act (42 U.S.C.
8254), but shall incorporate to the extent
feasible externalities such as impacts on
climate change and on peak energy demand that
are not already incorporated in assumed energy
costs.
``(C) Considerations.--In developing a national
energy efficiency building code under this paragraph,
the Secretary shall consider--
``(i) for residential national energy
efficiency building codes--
``(I) residential building
standards published or proposed by
ASHRAE;
``(II) building codes published or
proposed by the International Code
Council (ICC);
``(III) data from the Residential
Energy Services Network (RESNET) on
compliance measures utilized by
consumers to qualify for the
residential energy efficiency tax
credits established under the Energy
Policy Act of 2005;
``(IV) data and information from
the Department of Energy's Building
America Program;
``(V) data and information from the
Energy Star New Homes program;
``(VI) data and information from
the New Building Institute and similar
organizations; and
``(VII) standards for practices and
materials to achieve cool roofs in
residential buildings, taking into
consideration reduced air conditioning
energy use as a function of cool roofs,
the potential reduction in global
warming from increased solar
reflectance from buildings, and cool
roofs criteria in State and local
building codes and in national and
local voluntary programs, without
reduction of otherwise applicable
ceiling insulation standards; and
``(ii) for commercial national energy
efficiency building codes--
``(I) commercial building standards
proposed by ASHRAE;
``(II) building codes proposed by
the International Code Council (ICC);
``(III) the Core Performance
Criteria published by the New Buildings
Institute;
``(IV) data and information
developed by the Director of the
Commercial High-Performance Green
Building Office of the Department of
Energy and any public-private
partnerships established under that
Office;
``(V) data and information from the
Energy Star for Buildings program;
``(VI) data and information from
the New Building Institute, RESNET, and
similar organizations; and
``(VII) standards for practices and
materials to achieve cool roofs in
commercial buildings, taking into
consideration reduced air conditioning
energy use as a function of cool roofs,
the potential reduction in global
warming from increased solar
reflectance from buildings, and cool
roofs criteria in State and local
building codes and in national and
local voluntary programs, without
reduction of otherwise applicable
ceiling insulation standards.
``(D) Consultation.--In establishing any national
energy efficiency building code required by this
section, the Secretary shall consult with the Director
of the National Institute of Standards and Technology.
``(3) Consensus standard assistance.--(A) To support the
development of consensus standards that may provide the basis
for national energy efficiency building codes, minimize
duplication of effort, encourage progress through consensus,
and facilitate the development of greater building efficiency,
the Secretary shall provide assistance to recognized developers
of national energy codes and standards to develop, and where
the relevant code has been adopted as the national code,
disseminate consensus based energy efficiency building codes as
provided in this paragraph.
``(B) Upon a finding by the Secretary that a code developed
by such a developer meets a target established under subsection
(a), the Secretary shall--
``(i) send notice of the Secretary's finding to all
duly authorized or appointed State, tribal, and local
code agencies; and
``(ii) provide sufficient support to such a
developer to make the code available on the Internet,
or to accomplish distribution of such code to all such
State, tribal, and local code agencies at no cost to
the State, tribal, and local code agencies.
``(C) The Secretary may contract with such a developer and
with other organizations with expertise on codes to provide
training for State, tribal, and local code officials and
building inspectors in the implementation and enforcement of
such code.
``(D) The Secretary may provide grants and other support to
such a developer to--
``(i) develop appropriate refinements to such code;
and
``(ii) support analysis of options for improvements
in the code to meet the next scheduled target.
``(4) Code developed by secretary.--If the Secretary
establishes a national energy efficiency building code under
paragraph (2), the Secretary shall--
``(A) to the extent that such code is based on a
prior code developed by a recognized developer of
national energy codes and standards, negotiate and
provide appropriate compensation to such developer for
the use of the code materials that remain in the code
established by the Secretary; and
``(B) disseminate the national energy efficiency
building codes to State, tribal, and local code
officials, and support training and provide guidance
and technical assistance to such officials as
appropriate.
``(c) State Adoption of Energy Efficiency Building Codes.--
``(1) Requirement.--Not later than 1 year after a national
energy efficiency building code for residential or commercial
buildings is established or revised under subsection (b), each
State--
``(A) shall--
``(i) review and update the provisions of
its building code regarding energy efficiency
to meet or exceed the target met in the new
national energy efficiency building code, to
achieve equivalent or greater energy savings;
``(ii) document, where local governments
establish building codes, that local
governments representing not less than 80
percent of the State's urban population have
adopted the new national code, or have adopted
local codes that meet or exceed the target met
in the new national code to achieve equivalent
or greater energy savings; or
``(iii) adopt the new national code; and
``(B) shall provide a certification to the
Secretary demonstrating that energy efficiency building
code provisions that apply pursuant to subparagraph (A)
in that State meet or exceed the target met by the new
national code, to achieve equivalent or greater energy
savings.
``(2) Confirmation.--
``(A) Requirement.--Not later than 90 days after a
State certification is provided under paragraph (1)(B),
the Secretary shall determine whether the State's
energy efficiency building code provisions meet the
requirements of this subsection.
``(B) Acceptance by secretary.--If the Secretary
determines under subparagraph (A) that the State's
energy efficiency building code or codes meet the
requirements of this subsection, the Secretary shall
accept the certification.
``(C) Deficiency notice.--If the Secretary
determines under subparagraph (A) that the State's
building code or codes do not meet the requirements of
this subsection, the Secretary shall identify the
deficiency in meeting the national building code energy
efficiency target, and, to the extent possible,
indicate areas where further improvement in the State's
code provisions would allow the deficiency to be
eliminated.
``(D) Revision of code and recertification.--A
State may revise its code or codes and submit a
recertification under paragraph (1)(B) to the Secretary
at any time.
``(3) Compliant code.--For the purposes of meeting the
target described in subsection (a)(1)(A) for residential
buildings, a State that adopts the code represented in
California's Title 24-2009 by the date 27 months after the date
of enactment of the American Clean Energy and Security Act of
2009 shall be considered to have met the requirements of this
subsection for the applicable period.
``(d) Application of National Code to State and Local
Jurisdictions.--
``(1) In general.--Upon the expiration of 18 months after a
national energy efficiency building code is established under
subsection (b), in any jurisdiction where the State has not had
a certification relating to that code accepted by the Secretary
under subsection (c)(2)(B), and the local government has not
had a certification relating to that code accepted by the
Secretary under subsection (e)(5), the national energy
efficiency building code shall become the applicable energy
efficiency building code for such jurisdiction.
``(2) Conflicts.--In the event of a conflict between a
provision of the national energy efficiency building code and a
provision of other applicable energy codes, the national energy
efficiency building code shall apply. If there is a conflict
between a provision of the national energy efficiency building
code and a provision of any applicable fire code, life safety
code, egress code, or accessibility code, the Secretary shall
take appropriate actions to resolve such conflict in a manner
that does not compromise the objectives of such codes.
``(3) State legislative adoption.--In a State in which the
relevant building energy code is adopted legislatively, the
deadline in paragraph (1) shall not be earlier than 1 year
after the first day that the legislature meets following
establishment of a national energy efficiency building code.
``(4) Notice of intent to enforce.--A State or locality
that enforces building codes may assume responsibility for
enforcing the national energy efficiency building code by
notifying the Secretary to that effect not later than three
months after the date established under paragraph (1).
``(5) Violations.--Violations of this section shall be
defined as follows:
``(A) If the building is subject to the
requirements of a State energy efficiency building code
with respect to which a certification has been accepted
by the Secretary under subsection (c)(2)(B) or a local
energy efficiency building code with respect to which a
certification has been accepted by the Secretary
pursuant to subsection (e)(5), or the requirements of
the national energy efficiency building code in a State
where the State or locality has notified the Secretary
of its intent to enforce the provisions of the national
energy efficiency building code, a violation shall be
determined pursuant to the relevant provisions of State
or local law.
``(B) If the building is subject to the
requirements of a national energy efficiency building
code made applicable under paragraph (1) of this
subsection, except as provided in subparagraph (A), a
violation shall be defined by the Secretary pursuant to
subsection (g).
``(e) State Enforcement of Energy Efficiency Building Codes.--
``(1) In general.--Each State, or where applicable under
State law each local government, shall implement and enforce
applicable State or local codes with respect to which a
certification was accepted by the Secretary under subsection
(c)(2)(B) or paragraph (5) of this subsection, or the national
energy efficiency building codes, as provided in this
subsection.
``(2) State certification.--Not later than 2 years after
the date of a certification under subsection (c)(1) or the
application of a national energy efficiency building code under
subsection (d)(1), each State shall certify that it has--
``(A) achieved compliance with--
``(i) State codes, or, as provided under
State law, local codes, with respect to which a
certification was accepted by the Secretary
under subsection (c)(2)(B); or
``(ii) the national energy efficiency
building code, as applicable; or
``(B) for any certification submitted within 7
years after the date of enactment of the American Clean
Energy and Security Act of 2009, made significant
progress toward achieving such compliance.
``(3) Achieving compliance.--A State shall be considered to
achieve compliance with a code described in paragraph (2)(A) if
at least 90 percent of new and substantially renovated building
space in that State in the preceding year upon inspection meets
the requirements of the code. A certification under paragraph
(2) shall include documentation of the rate of compliance based
on--
``(A) independent inspections of a random sample of
the new and substantially renovated buildings covered
by the code in the preceding year; or
``(B) an alternative method that yields an accurate
measure of compliance as determined by the Secretary.
``(4) Significant progress.--A State shall be considered to
have made significant progress toward achieving compliance with
a code described in paragraph (2)(A) if--
``(A) the State has developed a plan, including for
hiring enforcement staff, providing training, providing
manuals and checklists, and instituting enforcement
programs, designed to achieve full compliance within 5
years after the date of the adoption of the code;
``(B) the State is taking significant, timely, and
measurable action to implement that plan;
``(C) the State has not reduced its expenditures
for code enforcement; and
``(D) at least 50 percent of new and substantially
renovated building space in the State in the preceding
year upon inspection meets the requirements of the
code.
``(5) Secretary's determination.--Not later than 90 days
after a State certification under paragraph (2), the Secretary
shall determine whether the State has demonstrated that it has
complied with the requirements of this subsection, including
accurate measurement of compliance, or that it has made
significant progress toward compliance. If such determination
is positive, the Secretary shall accept the certification. If
the determination is negative, the Secretary shall identify the
areas of deficiency.
``(6) Out of compliance.--
``(A) In general.--Any State for which the
Secretary has not accepted a certification under
paragraph (5) by the dates specified in paragraph (2)
is out of compliance with this section.
``(B) Local compliance.--In any State that is out
of compliance with this section as provided in
subparagraph (A), a local government may be in
compliance with this section by meeting all
certification requirements of this subsection.
``(C) Noncompliance.--Any State that is not in
compliance with this section, as provided in
subparagraph (A), shall, until the State regains such
compliance, be ineligible to receive--
``(i) emission allowances pursuant to
subsection (h)(1);
``(ii) Federal funding in excess of that
State's share (calculated according to the
allocation formula in section 363 of the Energy
Policy and Conservation Act (42 U.S.C. 6323))
of $125,000,000 each year; and
``(iii) for--
``(I) the first year for which the
State is out of compliance, 25 percent
of any additional funding or other
items of monetary value otherwise
provided under the American Clean
Energy and Security Act of 2009;
``(II) the second year for which
the State is out of compliance, 50
percent of any additional funding or
other items of monetary value otherwise
provided under the American Clean
Energy and Security Act of 2009;
``(III) the third year for which
the State is out of compliance, 75
percent of any additional funding or
other items of monetary value otherwise
provided under the American Clean
Energy and Security Act of 2009; and
``(IV) the fourth and subsequent
years for which the State is out of
compliance, 100 percent of any
additional funding or other items of
monetary value otherwise provided under
the American Clean Energy and Security
Act of 2009.
``(f) Federal Enforcement and Training.--Where a State fails and
local governments in that State also fail to enforce the applicable
State or national energy efficiency building codes, the Secretary shall
enforce such codes, as follows:
``(1) The Secretary shall establish, by rule, within 2
years after the date of enactment of the American Clean Energy
and Security Act of 2009, an energy efficiency building code
enforcement capability.
``(2) Such enforcement capability shall be designed to
achieve 90 percent compliance with such code in any State
within 1 year after the date of the Secretary's determination
that such State is out of compliance with this section.
``(3) The Secretary may set and collect reasonable
inspection fees to cover the costs of inspections required for
such enforcement. Revenue from fees collected shall be
available to the Secretary to carry out the requirements of
this section upon appropriation.
``(4) In any jurisdiction to which this subsection applies,
the Secretary shall coordinate enforcement of the national
energy efficiency building code with State and local code
enforcement of other building codes.
``(5) In any jurisdiction to which this subsection applies,
the Secretary shall enhance compliance by conducting training
and education of builders and other professionals in the
jurisdiction concerning the national energy efficiency building
code.
``(6) The Secretary shall coordinate with professional
organizations representing code officials, architects,
engineers, builders, and other experts to develop training
curricula concerning the national energy efficiency building
code.
``(7) If the Secretary enforces such codes under this
subsection, the Secretary may, as appropriate, redefine
violations of such codes.
``(g) Enforcement Procedures.--The Secretary shall propose and, not
later than 3 years after the date of enactment of the American Clean
Energy and Security Act of 2009, shall define by rule violations of the
energy efficiency building codes to be enforced by the Secretary
pursuant to this section, and the penalties that shall apply to
violators, in any jurisdiction in which the national energy efficiency
building code has been made applicable under subsection (d)(1). To the
extent that the Secretary determines that the authority to adopt and
impose such violations and penalties by rule requires further statutory
authority, the Secretary shall report such determination to Congress as
soon as such determination is made, but not later than 1 year after the
enactment of the American Clean Energy and Security Act of 2009.
``(h) Federal Support.--
``(1) Allowance allocation for state compliance.--For each
vintage year from 2012 through 2050, the Administrator shall
distribute allowances allocated pursuant to section 782(g)(2)
of the Clean Air Act to the SEED Account for each State. Such
allowances shall be distributed according to a formula
established by the Secretary as follows:
``(A) One-fifth in an equal amount to each of the
50 States and United States territories.
``(B) Two-fifths as a function of the relative
energy use in all buildings in each State in the most
recent year for which data is available.
``(C) Two-fifths based on the number of building
construction starts recorded in each State, the number
of new building permits applied for in each State, or
other relevant available data indicating building
activity in each State, in the judgment of the
Secretary, for the year prior to the year of the
distribution.
``(2) Allowance allocation to local governments.--In the
instance that the Secretary certifies that one or more local
governments are in compliance with this section pursuant to
subsection (e)(6)(B), the Administrator shall provide to each
such local government the portion of the emission allowances
that would have been provided to that State as a function of
the population of that locality as a proportion of the
population of that State as a whole.
``(3) Unallocated allowances.--To the extent that
allowances are not provided to State or local governments for
lack of certification in any year, those allowances shall be
added to the amount provided to those States and local
governments that are certified as eligible in that year.
``(4) Use of allowances.--Each State or each local
government shall use such emission allowances as it receives
pursuant to this section exclusively for the purposes of this
section, including covering a reasonable portion of the costs
of the development, adoption, implementation, and enforcement
of a State or local energy efficiency building code that meets
the national building code energy efficiency targets, or the
national energy efficiency building code. In a State where
local governments provide substantially all building code
enforcement, a minimum of 50 percent of the allowance value
received pursuant to this section shall be distributed to local
governments as a function of the relative populations of such
localities. In a State where local and State governments share
building code enforcement duties, the State and local shares of
allowance value required for enforcement shall be allocated in
proportion to the number of building inspections performed by
each level of government, and the share for local governments
shall be distributed as a function of the relative populations
of such localities. States shall further ensure that the
allowance value made available pursuant to section 782 of the
Clean Air Act and section 132 of the American Clean Energy and
Security Act of 2009 is provided to the applicable State or
local governmental entities as necessary to adopt and implement
energy efficiency building codes, provide training for
inspectors, ensure compliance, and provide such other functions
as necessary. Actions taken by local authorities pursuant to
this section shall constitute an acceptable use of funds
authorized pursuant to the Energy Efficiency and Conservation
Block Grant program under section 544 of the Energy
Independence and Security Act of 2007 (42 U.S.C. 17154).
``(i) Authorization of Appropriations.--There are authorized to be
appropriated to the Secretary of Energy $25,000,000, and such
additional sums as may be necessary to provide enforcement of a
national energy efficiency building code, for each of fiscal years 2010
through 2020, and such sums thereafter as may be necessary to support
the purposes of this section.
``(j) Annual Reports by Secretary.--The Secretary shall annually
submit to Congress, and publish in the Federal Register, a report on--
``(1) the status of national energy efficiency building
codes;
``(2) the status of energy efficiency building code
adoption and compliance in the States;
``(3) the implementation of this section;
``(4) the status of Federal enforcement of building codes,
including coordination with State and local enforcement, and
the extent and resolution of any conflicts between the national
energy efficiency building code and other residential and
commercial building codes in force in the same jurisdictions;
and
``(5) impacts of past action under this section, and
potential impacts of further action, on lifetime energy use by
buildings, including resulting energy and cost savings.''.
SEC. 202. BUILDING RETROFIT PROGRAM.
(a) Definitions.--For purposes of this section:
(1) Assisted housing.--The term ``assisted housing'' means
those properties receiving project-based assistance pursuant to
section 202 of the Housing Act of 1959 (12 U.S.C. 1701q),
section 811 of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 8013), section 8 of the United States
Housing Act of 1937 (42 U.S.C. 1437f), or similar programs.
(2) Nonresidential building.--The term ``nonresidential
building'' means a building with a primary use or purpose other
than residential housing, including any building used for
commercial offices, schools, academic and other public and
private institutions, nonprofit organizations including faith-
based organizations, hospitals, hotels, and other
nonresidential purposes. Such buildings shall include mixed-use
properties used for both residential and nonresidential
purposes in which more than half of building floor space is
nonresidential.
(3) Performance-based building retrofit program.--The term
``performance-based building retrofit program'' means a program
that determines building energy efficiency success based on
actual measured savings after a retrofit is complete, as
evidenced by energy invoices or evaluation protocols.
(4) Prescriptive building retrofit program.--The term
``prescriptive building retrofit program'' means a program that
projects building retrofit energy efficiency success based on
the known effectiveness of measures prescribed to be included
in a retrofit.
(5) Public housing.--The term ``public housing'' means
properties receiving assistance under section 9 of the United
States Housing Act of 1937 (42 U.S.C. 1437g).
(6) Recommissioning; retrocommissioning.--The terms
``recommissioning'' and ``retrocommissioning'' have the meaning
given those terms in section 543(f)(1) of the National Energy
Conservation Policy Act (42 U.S.C. 8253(f)(1)).
(7) Residential building.--The term ``residential
building'' means a building whose primary use is residential.
Such buildings shall include single-family homes (both attached
and detached), owner-occupied units in larger buildings with
their own dedicated space-conditioning systems, apartment
buildings, multi-unit condominium buildings, public housing,
assisted housing, and buildings used for both residential and
nonresidential purposes in which more than half of building
floor space is residential.
(8) State energy program.--The term ``State Energy
Program'' means the program under part D of title III of the
Energy Policy and Conservation Act (42 U.S.C. 6321 et seq.).
(b) Establishment.--The Administrator shall develop and implement,
in consultation with the Secretary of Energy, standards for a national
energy and environmental building retrofit policy for single-family and
multifamily residences. The Administrator shall develop and implement,
in consultation with the Secretary of Energy and the Director of
Commercial High-Performance Green Buildings, standards for a national
energy and environmental building retrofit policy for nonresidential
buildings. The programs to implement the residential and nonresidential
policies based on the standards developed under this section shall
together be known as the Retrofit for Energy and Environmental
Performance (REEP) program.
(c) Purpose.--The purpose of the REEP program is to facilitate the
retrofitting of existing buildings across the United States to achieve
maximum cost-effective energy efficiency improvements and significant
improvements in water use and other environmental attributes.
(d) Federal Administration.--
(1) Existing programs.--In creating and operating the REEP
program--
(A) the Administrator shall make appropriate use of
existing programs, including the Energy Star program
and in particular the Environmental Protection Agency
Energy Star for Buildings program; and
(B) the Secretary of Energy shall make appropriate
use of existing programs, including delegating
authority to the Director of Commercial High-
Performance Green Buildings appointed under section 421
of the Energy Independence and Security Act of 2007 (42
U.S.C. 17081), who shall designate and provide funding
to support a high-performance green building
partnership consortium pursuant to subsection (f) of
such section to support efforts under this section.
(2) Consultation and coordination.--The Administrator and
the Secretary of Energy shall consult with and coordinate with
the Secretary of Housing and Urban Development in carrying out
the REEP program with regard to retrofitting of public housing
and assisted housing. As a result of such consultation, the
Administrator shall establish standards to ensure that
retrofits of public housing and assisted housing funded
pursuant to this section are cost-effective, including
opportunities to address the potential co-performance of repair
and replacement needs that may be supported with other forms of
Federal assistance. Owners of public housing or assisted
housing receiving funding through the REEP program shall agree
to continue to provide affordable housing consistent with the
provisions of the authorizing legislation governing each
program for an additional period commensurate with the funding
received, as determined in accordance with guidelines
established by the Secretary of Housing and Urban Development.
(3) Assistance.--The Administrator and the Secretary of
Energy shall provide consultation and assistance to State and
local agencies for the establishment of revolving loan funds,
loan guarantees, or other forms of financial assistance under
this section.
(e) State and Local Administration.--
(1) Designation and delegation.--A State may designate one
or more agencies or entities, including those regulated by the
State, to carry out the purposes of this section, but shall
designate one entity or individual as the principal point of
contact for the Administrator regarding the REEP Program. The
designated State agency, agencies, or entities may delegate
performance of appropriate elements of the REEP program, upon
their request and subject to State law, to counties,
municipalities, appropriate public agencies, and other
divisions of local government, as well as to entities regulated
by the State. In making any such designation or delegation, a
State shall give priority to entities that administer existing
comprehensive retrofit programs, including those under the
supervision of State utility regulators. States shall maintain
responsibility for meeting the standards and requirements of
the REEP program. In any State that elects not to administer
the REEP program, a unit of local government may propose to do
so within its jurisdiction, and if the Administrator finds that
such local government is capable of administering the program,
the Administrator may provide allowances to that local
government, prorated according to the population of the local
jurisdiction relative to the population of the State, for
purposes of the REEP program.
(2) Employment.--States and local government entities may
administer a REEP program in a manner that authorizes public or
regulated investor-owned utilities, building auditors and
inspectors, contractors, nonprofit organizations, for-profit
companies, and other entities to perform audits and retrofit
services under this section. A State may provide incentives for
retrofits without direct participation by the State or its
agents, so long as the resulting savings are measured and
verified. A State or local administrator of a REEP program
shall seek to ensure that sufficient qualified entities are
available to support retrofit activities so that building
owners have a competitive choice among qualified auditors,
raters, contractors, and providers of services related to
retrofits. Nothing in this section is intended to deny the
right of a building owner to choose the specific providers of
retrofit services to engage for a retrofit project in that
owner's building.
(3) Equal incentives for equal improvement.--In general,
the States should strive to offer the same levels of incentives
for retrofits that meet the same efficiency improvement goals,
regardless of whether the State, its agency or entity, or the
building owner has conducted the retrofit achieving the
improvement, provided the improvement is measured and verified.
(f) Elements of Reep Program.--The Administrator, in consultation
with the Secretary of Energy, shall establish goals, guidelines,
practices, and standards for accomplishing the purpose stated in
subsection (c), and shall annually review and, as appropriate, revise
such goals, guidelines, practices, and standards. The program under
this section shall include the following:
(1) Residential Energy Services Network (RESNET) or
Building Performance Institute (BPI) analyst certification of
residential building energy and environment auditors,
inspectors, and raters, or an equivalent certification system
as determined by the Administrator.
(2) BPI certification or licensing by States of residential
building energy and environmental retrofit contractors, or an
equivalent certification or licensing system as determined by
the Administrator.
(3) Provision of BPI, RESNET, or other appropriate
information on equipment and procedures, as determined by the
Administrator, that contractors can use to test the energy and
environmental efficiency of buildings effectively (such as
infrared photography and pressurized testing, and tests for
water use and indoor air quality).
(4) Provision of clear and effective materials to describe
the testing and retrofit processes for typical buildings.
(5) Guidelines for offering and managing prescriptive
building retrofit programs and performance-based building
retrofit programs for residential and nonresidential buildings.
(6) Guidelines for applying recommissioning and
retrocommissioning principles to improve a building's
operations and maintenance procedures.
(7) A requirement that building retrofits conducted
pursuant to a REEP program utilize, especially in all air-
conditioned buildings, roofing materials with high solar energy
reflectance, unless inappropriate due to green roof management,
solar energy production, or for other reasons identified by the
Administrator, in order to reduce energy consumption within the
building, increase the albedo of the building's roof, and
decrease the heat island effect in the area of the building,
without reduction of otherwise applicable ceiling insulation
standards.
(8) Determination of energy savings in a performance-based
building retrofit program through--
(A) for residential buildings, comparison of before
and after retrofit scores on the Home Energy Rating
System (HERS) Index, where the final score is produced
by an objective third party;
(B) for nonresidential buildings, Environmental
Protection Agency Portfolio Manager benchmarks; or
(C) for either residential or nonresidential
buildings, use of an Administrator-approved simulation
program by a contractor with the appropriate
certification, subject to appropriate software
standards and verification of at least 15 percent of
all work done, or such other percentage as the
Administrator may determine.
(9) Guidelines for utilizing the Energy Star Portfolio
Manager, the Home Energy Rating System (HERS) rating system,
Home Performance with Energy Star program approvals, and any
other tools associated with the retrofit program.
(10) Requirements and guidelines for post-retrofit
inspection and confirmation of work and energy savings.
(11) Detailed descriptions of funding options for the
benefit of State and local governments, along with model forms,
accounting aids, agreements, and guides to best practices.
(12) Guidance on opportunities for--
(A) rating or certifying retrofitted buildings as
Energy Star buildings, or as green buildings under a
recognized green building rating system;
(B) assigning Home Energy Rating System (HERS) or
similar ratings; and
(C) completing any applicable building performance
labels.
(13) Sample materials for publicizing the program to
building owners, including public service announcements and
advertisements.
(14) Processes for tracking the numbers and locations of
buildings retrofitted under the REEP program, with information
on projected and actual savings of energy and its value over
time.
(g) Requirements.--As a condition of receiving allowances for the
REEP program pursuant to this Act, a State or qualifying local
government shall--
(1) adopt the standards for training, certification of
contractors, certification of buildings, and post-retrofit
inspection as developed by the Administrator for residential
and nonresidential buildings, respectively, except as necessary
to match local conditions, needs, efficiency opportunities, or
other local factors, or to accord with State laws or
regulations, and then only after the Administrator approves
such a variance;
(2) establish fiscal controls and accounting procedures
(which conform to generally accepted government accounting
principles) sufficient to ensure proper accounting during
appropriate accounting periods for payments received and
disbursements, and for fund balances; and
(3) agree to make not less than 10 percent of allowance
value received pursuant to section 132(c)(2) for dedicated
funding of its REEP program available on a preferential basis
for retrofit projects proposed for public housing and assisted
housing, provided that--
(A) none of such funds shall be used for demolition
of such housing;
(B) such retrofits not shall not be used to justify
any increase in rents charged to residents of such
housing; and
(C) owners of such housing shall agree to continue
to provide affordable housing consistent with the
provisions of the authorizing legislation governing
each program for an additional period commensurate with
the funding received.
The Administrator shall conduct or require each State to have such
independent financial audits of REEP-related funding as the
Administrator considers necessary or appropriate to carry out the
purposes of this section.
(h) Options to Support Reep Program.--The emission allowances
provided pursuant to this Act to the States SEED Accounts shall support
the implementation through State REEP programs of alternate means of
creating incentives for, or reducing financial barriers to, improved
energy and environmental performance in buildings, consistent with this
section, including--
(1) implementing prescriptive building retrofit programs
and performance-based building retrofit programs;
(2) providing credit enhancement, interest rate subsidies,
loan guarantees, or other credit support;
(3) providing initial capital for public revolving fund
financing of retrofits, with repayments by beneficiary building
owners over time through their tax payments, calibrated to
create net positive cash flow to the building owner;
(4) providing funds to support utility-operated retrofit
programs with repayments over time through utility rates,
calibrated to create net positive cash flow to the building
owner, and transferable from one building owner to the next
with the building's utility services;
(5) providing funds to local government programs to provide
REEP services and financial assistance; and
(6) other means proposed by State and local agencies,
subject to the approval of the Administrator.
(i) Support for Program.--
(1) Use of allowances.--Direct Federal support for the REEP
program is provided through the emission allowances allocated
to the States' SEED Accounts pursuant to section 132 of this
Act. To the extent that a State provides allowances to local
governments within the State to implement elements of the REEP
Program, that shall be deemed a distribution of such allowances
to units of local government pursuant to subsection (c)(1) of
that section.
(2) Initial award limits.--Except as provided in paragraph
(3), State and local REEP programs may make per-building direct
expenditures for retrofit improvements, or their equivalent in
indirect or other forms of financial support, from funds
derived from the sale of allowances received directly from the
Administrator in amounts not to exceed the following amounts
per unit:
(A) Residential building program.--
(i) Awards.--For residential buildings--
(I) support for a free or low-cost
detailed building energy audit that
prescribes measures sufficient to
achieve at least a 20 percent reduction
in energy use, by providing an
incentive equal to the documented cost
of such audit, but not more than $200,
in addition to any earned by achieving
a 20 percent or greater efficiency
improvement;
(II) a total of $1,000 for a
combination of measures, prescribed in
an audit conducted under subclause (I),
designed to reduce energy consumption
by more than 10 percent, and $2,000 for
a combination of measures prescribed in
such an audit, designed to reduce
energy consumption by more than 20
percent;
(III) $3,000 for demonstrated
savings of 20 percent, pursuant to a
performance-based building retrofit
program; and
(IV) $1,000 for each additional 5
percentage points of energy savings
achieved beyond savings for which
funding is provided under subclause
(II) or (III).
Funding shall not be provided under clauses
(II) and (III) for the same energy savings.
(ii) Maximum percentage.--Awards under
clause (i) shall not exceed 50 percent of
retrofit costs for each building. For buildings
with multiple residential units, awards under
clause (i) shall not be greater than 50 percent
of the total cost of retrofitting the building,
prorated among individual residential units on
the basis of relative costs of the retrofit. In
the case of public housing and assisted
housing, the 50 percent contribution matching
the contribution from REEP program funds may
come from any other source, including other
Federal funds.
(iii) Additional awards.--Additional awards
may be provided for purposes of increasing
energy efficiency, for buildings achieving at
least 20 percent energy savings using funding
provided under clause (i), in the form of
grants of not more than $600 for measures
projected or measured (using an appropriate
method approved by the Administrator) to
achieve at least 35 percent potable water
savings through equipment or systems with an
estimated service life of not less than 7
years, and not more than an additional $20 may
be provided for each additional one percent of
such savings, up to a maximum total grant of
$1,200.
(B) Nonresidential building program.--
(i) Awards.--For nonresidential buildings--
(I) support for a free or low-cost
detailed building energy audit that
prescribes, as part of a energy-
reducing measures sufficient to achieve
at least a 20 percent reduction in
energy use, by providing an incentive
equal to the documented cost of such
audit, but not more than $500, in
addition to any award earned by
achieving a 20 percent or greater
efficiency improvement;
(II) $0.15 per square foot of
retrofit area for demonstrated energy
use reductions from 20 percent to 30
percent;
(III) $0.75 per square foot for
demonstrated energy use reductions from
30 percent to 40 percent;
(IV) $1.60 per square foot for
demonstrated energy use reductions from
40 percent to 50 percent; and
(V) $2.50 per square foot for
demonstrated energy use reductions
exceeding 50 percent.
(ii) Maximum percentage.--Amounts provided
under subclauses (II) through (V) of clause (i)
combined shall not exceed 50 percent of the
total retrofit cost of a building. In
nonresidential buildings with multiple units,
such awards shall be prorated among individual
units on the basis of relative costs of the
retrofit.
(iii) Additional awards.--Additional awards
may be provided, for buildings achieving at
least 20 percent energy savings using funding
provided under clause (i), as follows:
(I) Water.--For purposes of
increasing energy efficiency, grants
may be made for whole building potable
water use reduction (using an
appropriate method approved by the
Administrator) for up to 50 percent of
the total retrofit cost, including
amounts up to--
(aa) $24.00 per thousand
gallons per year of potable
water savings of 40 percent or
more;
(bb) $27.00 per thousand
gallons per year of potable
water savings of 50 percent or
more; and
(cc) $30.00 per thousand
gallons per year of potable
water savings of 60 percent or
more.
(II) Environmental improvements.--
Additional awards of up to $1,000 may
be granted for the inclusion of other
environmental attributes that the
Administrator, in consultation with the
Secretary, identifies as contributing
to energy efficiency. Such attributes
may include, but are not limited to
waste diversion and the use of
environmentally preferable materials
(including salvaged, renewable, or
recycled materials, and materials with
no or low-VOC content). The
Administrator may recommend that States
develop such standards as are necessary
to account for local or regional
conditions that may affect the
feasibility or availability of
identified resources and attributes.
(iv) Indoor air quality minimum.--
Nonresidential buildings receiving incentives
under this section must satisfy at a minimum
the most recent version of ASHRAE Standard 62.1
for ventilation, or the equivalent as
determined by the Administrator. A State may
issue a waiver from this requirement to a
building project on a showing that such
compliance is infeasible due to the physical
constraints of the building's existing
ventilation system, or such other limitations
as may be specified by the Administrator.
(C) Disaster damaged buildings.--Any source of
funds, including Federal funds provided through the
Robert T. Stafford Disaster Relief and Emergency
Assistance Act, shall qualify as the building owner's
50 percent contribution, in order to match the
contribution of REEP funds, so long as the REEP funds
are only used to improve the energy efficiency of the
buildings being reconstructed. In addition, the
appropriate Federal agencies providing assistance to
building owners through the Robert T. Stafford Disaster
Relief and Emergency Assistance Act shall make
information available, following a disaster, to
building owners rebuilding disaster damaged buildings
with assistance from the Act, that REEP funds may be
used for energy efficiency improvements.
(D) Historic buildings.--Notwithstanding
subparagraphs (A) and (B), a building in or eligible
for the National Register of Historic Places shall be
eligible for awards under this paragraph in amounts up
to 120 percent of the amounts set forth in
subparagraphs (A) and (B).
(E) Supplemental support.--State and local
governments may supplement the per-building
expenditures under this paragraph with funding from
other sources.
(3) Adjustment.--The Administrator may adjust the specific
dollar limits funded by the sale of allowances pursuant to
paragraph (2) in years subsequent to the second year after the
date of enactment of this Act, and every 2 years thereafter, as
the Administrator determines necessary to achieve optimum cost-
effectiveness and to maximize incentives to achieve energy
efficiency within the total building award amounts provided in
that paragraph, and shall publish and hold constant such
revised limits for at least 2 years.
(j) Report to Congress.--The Administrator shall conduct an annual
assessment of the achievements of the REEP program in each State, shall
prepare an annual report of such achievements and any recommendations
for program modifications, and shall provide such report to Congress at
the end of each fiscal year during which funding or other resources
were made available to the States for the REEP Program.
(k) Other Sources of Federal Support.--
(1) Additional state energy program funds.--Any Federal
funding provided to a State Energy Program that is not required
to be expended for a different federally designated purpose may
be used to support a REEP program.
(2) Program administration.--State Energy Offices or
designated State agencies may expend up to 10 percent of
available allowance value provided under this section for
program administration.
(3) Authorization of appropriations.--There are authorized
to be appropriated for the purposes of this section, for each
of fiscal years 2010, 2011, 2012, and 2013--
(A) $50,000,000 to the Administrator for program
administration costs; and
(B) $20,000,000 to the Secretary of Energy for
program administration costs.
SEC. 203. ENERGY EFFICIENT MANUFACTURED HOMES.
(a) Definitions.--In this section:
(1) Manufactured home.--The term ``manufactured home'' has
the meaning given such term in section 603 of the National
Manufactured Housing Construction and Safety Standards Act of
1974 (42 U.S.C. 5402).
(2) Energy star qualified manufactured home.--The term
``Energy Star qualified manufactured home'' means a
manufactured home that has been designed, produced, and
installed in accordance with Energy Star's guidelines by an
Energy Star certified plant.
(b) Purpose.--The purpose of this section is to assist low-income
households residing in manufactured homes constructed prior to 1976 to
save energy and energy expenditures by providing support toward the
purchase of new Energy Star qualified manufactured homes.
(c) State Implementation of Program.--
(1) Manufactured home replacement program.--Any State may
provide to the owner of a manufactured home constructed prior
to 1976 a rebate to use toward the purchase of a new Energy
Star qualified manufactured home pursuant to this section.
(2) Use of allowances.--Direct Federal support for the
program established in this section is provided through the
emission allowances allocated to the States' SEED Accounts
pursuant to section 132 of this Act. To the extent that a State
provides allowances to local governments within the State to
implement this program, that shall be deemed a distribution of
such allowances to units of local government pursuant to
subsection (c)(1) of that section.
(3) Rebates.--
(A) Primary residence requirement.--A rebate
described under paragraph (1) may only be made to an
owner of a manufactured home constructed prior to 1976
that is used on a year-round basis as a primary
residence.
(B) Dismantling and replacement.--A rebate
described under paragraph (1) may be made only if the
manufactured home constructed prior to 1976 will be--
(i) rendered unusable for human habitation
(including appropriate recycling); and
(ii) replaced, in the same general
location, as determined by the applicable State
agency, with an Energy Star qualified
manufactured home.
(C) Single rebate.--A rebate described under
paragraph (1) may not be provided to any owner of a
manufactured home constructed prior to 1976 that was or
is a member of a household for which any other member
of the household was provided a rebate pursuant to this
section.
(D) Eligible households.--To be eligible to receive
a rebate described under paragraph (1), an owner of a
manufactured home constructed prior to 1976 shall
demonstrate to the applicable State agency that the
total income of all members the owner's household does
not exceed 200 percent of the Federal poverty level for
income in the applicable area.
(E) Advance availability.--A rebate may be provided
under this section in a manner to facilitate the
purchase of a new Energy Star qualified manufactured
home.
(4) Rebate limitation.--Rebates provided by States under
this section shall not exceed $7,500 per manufactured home from
any value derived from the use of emission allowances provided
to the State pursuant to section 132.
(5) Use of state funds.--A State providing rebates under
this section may supplement the amount of such rebates under
paragraph (4) by any additional amount is from State funds and
other sources, including private donations or grants from
charitable organizations.
(6) Coordination with similar programs.--
(A) State programs.--A State conducting an existing
program that has the purpose of replacing manufactured
homes constructed prior to 1976 with Energy Star
qualified manufactured homes, may use allowance value
provided under section 782 of the Clean Air Act to
support such a program, provided such funding does not
exceed the rebate limitation amount under paragraph
(4).
(B) Federal programs.--The Secretary of Energy
shall coordinate with and seek to achieve the purpose
of this section through similar Federal programs
including--
(i) the Weatherization Assistance Program
under part A of title IV of the Energy
Conservation and Production Act (42 U.S.C. 6861
et seq.); and
(ii) the program under part D of title III
of the Energy Policy and Conservation Act (42
U.S.C. 6321 et seq.).
(C) Coordination with other state agencies.--A
State agency using allowance value to administer the
program under this section may coordinate its efforts,
and share funds for administration, with other State
agencies involved in low-income housing programs.
(7) Administrative expenses.--A State using allowance value
under this section may expend not more than 10 percent of such
value for administrative expenses related to this program.
SEC. 204. BUILDING ENERGY PERFORMANCE LABELING PROGRAM.
(a) Establishment.--
(1) Purpose.--The Administrator shall establish a building
energy performance labeling program with broad applicability to
the residential and commercial markets to enable and encourage
knowledge about building energy performance by owners and
occupants and to inform efforts to reduce energy consumption
nationwide.
(2) Components.--In developing such program, the
Administrator shall--
(A) consider existing programs, such as
Environmental Protection Agency's Energy Star program,
the Home Energy Rating System (HERS) Index, and
programs at the Department of Energy;
(B) support the development of model performance
labels for residential and commercial buildings; and
(C) utilize incentives and other means to spur use
of energy performance labeling of public and private
sector buildings nationwide.
(b) Data Assessment for Building Energy Performance.--
(1) Initial report.--Not later than 90 days after the date
of enactment of this Act, the Administrator shall provide to
Congress, as well as to the Secretary of Energy and the Office
of Management and Budget, a report identifying--
(A) all principal building types for which
statistically significant energy performance data
exists to serve as the basis of measurement protocols
and labeling requirements for achieved building energy
performance; and
(B) those building types for which additional data
are required to enable the development of such
protocols and requirements.
(2) Additional reports.--Additional updated reports shall
be provided under this subsection as often as The Administrator
considers practicable, but not less than every 2 years.
(c) Building Data Acquisition.--
(1) Resource requirements.--For all principal building
types identified under subsection (b), the Secretary of Energy,
not later than 90 days after a report by the Administrator
under subsection (b), shall provide to Congress, the
Administrator, and the Office of Management and Budget a
statement of additional resources needed, if any, to fully
develop the relevant data, as well as the anticipated timeline
for data development.
(2) Consultation.--The Secretary of Energy shall consult
with the Administrator concerning the Administrator's ability
to use data series for these additional building types to
support the achieved performance component in the labeling
program.
(3) Improvements to building energy consumption
databases.--
(A) Commercial database.--The Secretary of Energy
shall support improvements to the Commercial Buildings
Energy Consumption Survey (CBECS) as authorized by
section 205(k) of the Department of Energy Organization
Act (42 U.S.C. 7135(k))--
(i) to enable complete and robust data for
the actual energy performance of principal
building types currently covered by survey;
(ii) to cover additional building types as
identified by the Administrator under
subsection (b)(1)(B), to enable the development
of achieved performance measurement protocols
are developed for at least 90 percent of all
major commercial building types within 5 years
after the date of enactment of this Act; and
(iii) to include third-party audits of
random data samplings to ensure the quality and
accuracy of survey information.
(B) Residential databases.--The Administrator, in
consultation with the Energy Information Administration
and the Secretary of Energy, shall support improvements
to the Residential Energy Consumption Survey (RECS) as
authorized by section 205(k) of the Department of
Energy Organization Act (42 U.S.C. 7135(k)), or such
other residential energy performance databases as the
Administrator considers appropriate, to aid the
development of achieved performance measurement
protocols for residential building energy use for at
least 90 percent of the residential market within 5
years after the date of enactment of this Act.
(C) Consultation.--The Secretary of Energy and the
Administrator shall consult with public, private, and
nonprofit sector representatives from the building
industry and real estate industry to assist in the
evaluation and improvement of building energy
performance databases and labeling programs.
(d) Identification of Measurement Protocols for Achieved
Performance.--
(1) Proposed protocols and requirements.--At the earliest
practicable date, but not later than 1 year after identifying a
building type under subsection (b)(1)(A), the Administrator
shall propose a measurement protocol for that building type and
a requirement detailing how to use that protocol in completing
applicable commercial or residential performance labels created
pursuant to this section.
(2) Final rule.--After providing for notice and comment,
the Administrator shall publish a final rule containing a
measurement protocol and the corresponding requirements for
applying that protocol. Such a rule--
(A) shall define the minimum period for measurement
of energy use by buildings of that type and other
details for determining achieved performance, to
include leased buildings or parts thereof;
(B) shall identify necessary data collection and
record retention requirements; and
(C) may specify transition rules and exemptions for
classes of buildings within the building type.
(e) Procedures for Evaluating Designed Performance.--The
Administrator shall develop protocols for evaluating the designed
performance of individual building types. The Administrator may conduct
such feasibility studies and demonstration projects as are necessary to
evaluate the sufficiency of proposed protocols for designed
performance.
(f) Creation of Building Energy Performance Labeling Program.--
(1) Model label.--Not later than 1 year after the date of
enactment of this Act, the Administrator shall propose a model
building energy label that provides a format--
(A) to display achieved performance and designed
performance data;
(B) that may be tailored for residential and
commercial buildings, and for single-occupancy and
multitenanted buildings; and
(C) to display other appropriate elements
identified during the development of measurement
protocols under subsections (d) and (e).
(2) Inclusions.--Nothing in this section shall require the
inclusion on such a label of designed performance data where
impracticable or not cost effective, or to preclude the display
of both achieved performance and designed performance data for
a particular building where both such measures are available,
practicable, and cost effective.
(3) Existing programs.--In developing the model label, the
Administrator shall consider existing programs, including--
(A) the Environmental Protection Agency's Energy
Star Portfolio Manager program and the California HERS
II Program Custom Approach for the achieved performance
component of the label;
(B) the Home Energy Rating System (HERS) Index
system for the designed performance component of the
label; and
(C) other Federal and State programs, including the
Department of Energy's related programs on building
technologies and those of the Federal Energy Management
Program.
(4) Final rule.--After providing for notice and comment,
the Administrator shall publish a final rule containing the
label applicable to covered building types.
(g) Demonstration Projects for Labeling Program.--
(1) In general.--The Administrator shall conduct building
energy performance labeling demonstration projects for
different building types--
(A) to ensure the sufficiency of the current
Commercial Buildings Energy Consumption Survey and
other data to serve as the basis for new measurement
protocols for the achieved performance component of the
building energy performance labeling program;
(B) to inform the development of measurement
protocols for building types not currently covered by
the Commercial Buildings Energy Consumption Survey; and
(C) to identify any additional information that
needs to be developed to ensure effective use of the
model label.
(2) Participation.--Such demonstration projects shall
include participation of--
(A) buildings from diverse geographical and climate
regions;
(B) buildings in both urban and rural areas;
(C) single-family residential buildings;
(D) multihousing residential buildings with more
than 50 units, including at least one project that
provides affordable housing to individuals of diverse
incomes;
(E) single-occupant commercial buildings larger
than 30,000 square feet;
(F) multitenanted commercial buildings larger than
50,000 square feet; and
(G) buildings from both the public and private
sectors.
(3) Priority.--Priority in the selection of demonstration
projects shall be given to projects that facilitate large-scale
implementation of the labeling program for samples of buildings
across neighborhoods, geographic regions, cities, or States.
(4) Findings.--The Administrator shall report any findings
from demonstration projects under this subsection, including an
identification of any areas of needed data improvement, to the
Department of Energy's Energy Information Administration and
Building Technologies Program.
(5) Coordination.--The Administrator and the Secretary of
Energy shall coordinate demonstration projects undertaken
pursuant to this subsection with those undertaken as part of
the Zero-Net-Energy Commercial Buildings Initiative adopted
under section 422 of the Energy Independence and Security Act
of 2007 (42 U.S.C. 17082).
(h) Implementation of Labeling Program.--
(1) In general.--The Administrator, in consultation with
the Secretary of Energy, shall work with all State Energy
Offices established pursuant to part D of title III of the
Energy Policy and Conservation Act (42 U.S.C. 6321 et seq.) or
other State authorities as necessary for the purpose of
implementing the labeling program established under this
section for commercial and residential buildings.
(2) Outreach to local authorities.--The Administrator
shall, acting in consultation and coordination with the
respective States, encourage use of the labeling program by
counties and other localities to broaden access to information
about building energy use, for example, through disclosure of
building label contents in tax, title, and other records those
localities maintain. For this purpose, the Administrator shall
develop an electronic version of the label and information that
can be readily transmitted and read in widely-available
computer programs but is protected from unauthorized
manipulation.
(3) Means of implementation.--In adopting the model
labeling program established under this section, a State shall
seek to ensure that labeled information be made accessible to
the public in a manner so that owners, lenders, tenants,
occupants, or other relevant parties can utilize it. Such
accessibility may be accomplished through--
(A) preparation, and public disclosure of the label
through filing with tax and title records at the time
of--
(i) a building audit conducted with support
from Federal or State funds;
(ii) a building energy-efficiency retrofit
conducted in response to such an audit;
(iii) a final inspection of major
renovations or additions made to a building in
accordance with a building permit issued by a
local government entity;
(iv) a sale that is recorded for title and
tax purposes consistent with paragraph (8);
(v) a new lien recorded on the property for
more than a set percentage of the assessed
value of the property, if that lien reflects
public financial assistance for energy-related
improvements to that building; or
(vi) a change in ownership or operation of
the building for purposes of utility billing;
or
(B) other appropriate means.
(4) State implementation of program.--
(A) Eligibility.--A State may become eligible to
utilize allowance value to implement this program by--
(i) adopting by statute or regulation a
requirement that buildings be assessed and
labeled, consistent with the labeling
requirements of the program established under
this section; or
(ii) adopting a plan to implement a model
labeling program consistent with this section
within 1 year of enactment of this Act,
including the establishment of that program
within 3 years after the date of enactment of
this Act, and demonstrating continuous progress
under that plan.
(B) Use of allowances.--Direct Federal support for
the program established in this section is provided
through the emission allowances allocated to the
States' SEED Accounts pursuant to section 132 of this
Act. To the extent that a State provides allowances to
local governments within the State to implement this
program, that shall be deemed a distribution of such
allowances to units of local government pursuant to
subsection (c)(1) of that section.
(5) Guidance.--The Administrator may create or identify
model programs and resources to provide guidance to offer to
States and localities for creating labeling programs consistent
with the model program established under this section.
(6) Progress report.--The Administrator, in consultation
with the Secretary of Energy, shall provide a progress report
to Congress not later than 3 years after the date of enactment
of this Act that--
(A) evaluates the effectiveness of efforts to
advance use of the model labeling program by States and
localities;
(B) recommends any legislative changes necessary to
broaden the use of the model labeling program; and
(C) identifies any changes to broaden the use of
the model labeling program that the Administrator has
made or intends to make that do not require additional
legislative authority.
(7) State information.--The Administrator may require
States to report to the Administrator information that the
Administrator requires to provide the report required under
paragraph (6).
(8) Prevention of disruption of sales transactions.--No
State shall implement a new labeling program pursuant to this
section in a manner that requires the labeling of a building to
occur after a contract has been executed for the sale of that
building and before the sales transaction is completed.
(i) Implementation of Labeling Program in Federal Buildings.--
(1) Use of labeling program.--The Secretary of Energy and
the Administrator shall use the labeling program established
under this section to evaluate energy performance in the
facilities of the Department of Energy and the Environmental
Protection Agency, respectively, to the extent practicable, and
shall encourage and support implementation efforts in other
Federal agencies.
(2) Annual progress report.--The Secretary of Energy and
Administrator shall provide an annual progress report to
Congress and the Office of Management and Budget detailing
efforts to implement this subsection, as well as any best
practices or needed resources identified as a result of such
efforts.
(j) Public Outreach.--The Secretary of Energy and the
Administrator, in consultation with nonprofit and industry stakeholders
with specialized expertise, and in conjunction with other energy
efficiency public awareness efforts, shall establish a business and
consumer education program to increase awareness about the importance
of building energy efficiency and to facilitate widespread use of the
labeling program established under this section.
(k) Definitions.--In this section:
(1) Building type.--The term ``building type'' means a
grouping of buildings as identified by their principal building
activities, or as grouped by their use, including office
buildings, laboratories, libraries, data centers, retail
establishments, hotels, warehouses, and educational buildings.
(2) Measurement protocol.--The term ``measurement
protocol'' means the methodology, prescribed by the
Administrator, for defining a benchmark for building energy
performance for a specific building type and for measuring that
performance against the benchmark.
(3) Achieved performance.--The term ``achieved
performance'' means the actual energy consumption of a building
as compared to a baseline building of the same type and size,
determined by actual consumption data normalized for
appropriate variables.
(4) Designed performance.--The term ``designed
performance'' means the energy consumption performance a
building would achieve if operated consistent with its design
intent for building energy use, utilizing a standardized set of
operational conditions informed by data collected or confirmed
during an energy audit.
(l) Authorization of Appropriations.--There are authorized to be
appropriated--
(1) to the Administrator $50,000,000 for implementation of
this section for each fiscal year from 2010 through 2020; and
(2) to the Secretary of Energy $20,000,000 for
implementation of this section for fiscal year 2010 and
$10,000,000 for fiscal years 2011 through 2020.
(m) New Construction.--This section shall apply only to
construction beginning after the date of enactment of this Act.
SEC. 205. TREE PLANTING PROGRAMS.
(a) Findings.--The Congress finds that--
(1) the utility sector is the largest single source of
greenhouse gas emissions in the United States today, producing
approximately one-third of the country's emissions;
(2) heating and cooling homes accounts for nearly 60
percent of residential electricity usage in the United States;
(3) shade trees planted in strategic locations can reduce
residential cooling costs by as much as 30 percent;
(4) shade trees have significant clean-air benefits
associated with them;
(5) every 100 healthy large trees removes about 300 pounds
of air pollution (including particulate matter and ozone) and
about 15 tons of carbon dioxide from the air each year;
(6) tree cover on private property and on newly-developed
land has declined since the 1970s, even while emissions from
transportation and industry have been rising; and
(7) in over a dozen test cities across the United States,
increasing urban tree cover has generated between two and five
dollars in savings for every dollar invested in such tree
planting.
(b) Definitions.--As used in this section:
(1) The term ``Secretary'' refers to the Secretary of
Energy.
(2) The term ``retail power provider'' means any entity
authorized under applicable State or Federal law to generate,
distribute, or provide retail electricity, natural gas, or fuel
oil service.
(3) The term ``tree-planting organization'' means any
nonprofit or not-for-profit group which exists, in whole or in
part, to--
(A) expand urban and residential tree cover;
(B) distribute trees for planting;
(C) increase awareness of the environmental and
energy-related benefits of trees;
(D) educate the public about proper tree planting,
care, and maintenance strategies; or
(E) carry out any combination of the foregoing
activities.
(4) The term ``tree-siting guidelines'' means a
comprehensive list of science-based measurements outlining the
species and minimum distance required between trees planted
pursuant to this section, in addition to the minimum required
distance to be maintained between such trees and--
(A) building foundations;
(B) air conditioning units;
(C) driveways and walkways;
(D) property fences;
(E) preexisting utility infrastructure;
(F) septic systems;
(G) swimming pools; and
(H) other infrastructure as deemed appropriate.
(5) The terms ``small office'', ``small office buildings'',
and ``small office settings'' means nonresidential buildings or
structures zoned for business purposes that are 20,000 square
feet or less in total area.
(c) Purposes.--The purpose of this section is to establish a grant
program to assist retail power providers with the establishment and
operation of targeted tree-planting programs in residential and small
office settings, for the following purposes:
(1) Reducing the peak-load demand for electricity from
residences and small office buildings during the summer months
through direct shading of buildings provided by strategically
planted trees.
(2) Reducing wintertime demand for energy from residences
and small office buildings by blocking cold winds from reaching
such structures, which lowers interior temperatures and drives
heating demand.
(3) Protecting public health by removing harmful pollution
from the air.
(4) Utilizing the natural photosynthetic and transpiration
process of trees to lower ambient temperatures and absorb
carbon dioxide, thus mitigating the effects of climate change.
(5) Lowering electric bills for residential and small
office ratepayers by limiting electricity consumption without
reducing benefits.
(6) Relieving financial and demand pressure on retail power
providers that stems from large peak-load energy demand.
(7) Protecting water quality and public health by reducing
stormwater runoff and keeping harmful pollutants from entering
waterways.
(8) Ensuring that trees are planted in locations that limit
the amount of public money needed to maintain public and
electric infrastructure.
(d) General Authority.--
(1) Assistance.--The Secretary is authorized to provide
financial, technical, and related assistance to retail power
providers to assist with the establishment of new, or continued
operation of existing, targeted tree-planting programs for
residences and small office buildings.
(2) Public recognition initiative.--In carrying out the
authority provided under this section, the Secretary shall also
create a national public recognition initiative to encourage
participation in tree-planting programs by retail power
providers.
(3) Eligibility.--Only those programs which utilize
targeted, strategic tree-siting guidelines to plant trees in
relation to building location, sunlight, and prevailing wind
direction shall be eligible for assistance under this section.
(4) Requirements.--In order to qualify for assistance under
this section, a tree-planting program shall meet each of the
following requirements:
(A) The program shall provide free or discounted
shade-providing or wind-reducing trees to residential
and small office consumers interested in lowering their
home energy costs.
(B) The program shall optimize the electricity-
consumption reduction benefit of each tree by planting
in strategic locations around a given residence or
small office.
(C) The program shall either--
(i) provide maximum amounts of shade during
summer intervals when residences and small
offices are exposed to the most sun intensity;
or
(ii) provide maximum amounts of wind
protection during fall and winter intervals
when residences and small offices are exposed
to the most wind intensity.
(D) The program shall use the best available
science to create tree siting guidelines which dictate
where the optimum tree species are best planted in
locations that achieve maximum reductions in consumer
energy demand while causing the least disruption to
public infrastructure, considering overhead and
underground facilities.
(E) The program shall receive certification from
the Secretary that it is designed to achieve the goals
set forth in subparagraphs (A) through (D). In
designating criteria for such certification, the
Secretary shall collaborate with the United States
Forest Service's Urban and Community Forestry Program
to ensure that certification requirements are
consistent with such above goals.
(5) New program funding share.--The Secretary shall ensure
that no less than 30 percent of the funds made available under
this section are distributed to retail power providers which--
(A) have not previously established or operated
qualified tree-planting programs; or
(B) are operating qualified tree-planting programs
which were established no more than 3 years prior to
the date of enactment of this section.
(e) Agreements Between Electricity Providers and Tree-planting
Organizations.--
(1) Grant authorization.--In providing assistance under
this section, the Secretary is authorized to award grants only
to retail power providers that have entered into binding legal
agreements with nonprofit tree-planting organizations.
(2) Conditions of agreement.--Those agreements between
retail power providers and tree-planting organizations shall
set forth conditions under which nonprofit tree-planting
organizations shall provide targeted tree-planting programs
which may require these organizations to--
(A) participate in local technical advisory
committees responsible for drafting general tree-siting
guidelines and choosing the most effective species of
trees to plant in given locations;
(B) coordinate volunteer recruitment to assist with
the physical act of planting trees in residential
locations;
(C) undertake public awareness campaigns to educate
local residents about the benefits, cost savings, and
availability of free shade trees;
(D) establish education and information campaigns
to encourage recipients to maintain their shade trees
over the long term;
(E) serve as the point of contact for existing and
potential residential participants who have questions
or concerns regarding the tree-planting program;
(F) require tree recipients to sign agreements
committing to voluntary stewardship and care of
provided trees;
(G) monitor and report on the survival, growth,
overall health, and estimated energy savings of
provided trees up until the end of their establishment
period which shall be no less than 5 years; and
(H) ensure that trees planted near existing power
lines will not interfere with energized electricity
distribution lines when mature, and that no new trees
will be planted under or adjacent to high-voltage
electric transmission lines without prior consultation
with the applicable retail power provider receiving
assistance under this section.
(3) Lack of nonprofit organization.--If qualified nonprofit
or not-for-profit tree planting organizations do not exist or
operate within areas served by retail power providers applying
for assistance under this section, the requirements of this
section shall apply to binding legal agreements entered into by
such retail power providers and one of the following entities:
(A) Local municipal governments with jurisdiction
over the urban or suburban forest.
(B) The State Forester for the State in which the
tree planting program will operate.
(C) The United States Forest Service's Urban and
Community Forestry representative for the State in
which the tree-planting program will operate.
(D) A landscaping services company that is--
(i) identified in consultation with a
national or State nonprofit or not-for-profit
tree-planting organization;
(ii) licensed to operate in the State in
which the tree-planting program will operate;
and
(iii) a business as defined by the United
States Census Bureau's 2007 North American
Industry Classification System Code 561730.
(f) Technical Advisory Committees.--
(1) Description.--In order to qualify for assistance under
this section, the retail power provider shall establish and
consult with a local technical advisory committee which shall
provide advice and consultation to the program, and may--
(A) design and adopt an approved plant list that
emphasizes the use of hardy, noninvasive tree species
and, where geographically appropriate, the use of
native, or site-adapted, or low water-use shade trees;
(B) design and adopt planting, installation, and
maintenance specifications and create a process for
inspection and quality control;
(C) ensure that tree recipients are educated to
care for and maintain their trees over the long term;
(D) help the public become more engaged and
educated in the planting and care of shade trees;
(E) prioritize which sites receive trees, giving
preference to locations with the most potential for
energy conservation and secondary preference to areas
where the average annual income is below the regional
median; and
(F) assist with monitoring and collection of data
on tree health, tree survival, and energy conservation
benefits generated under this section.
(2) Compensation.--Individuals serving on local technical
advisory committees shall not receive compensation for their
service.
(3) Composition.--Local technical advisory committees shall
be composed of representatives from public, private, and
nongovernmental agencies with expertise in demand-side energy
efficiency management, urban forestry, or arboriculture, and
shall be composed of the following:
(A) Up to 4 persons, but no less than one person,
representing the retail power provider receiving
assistance under this section.
(B) Up to 4 persons, but no less than one person,
representing the local tree-planting organization which
will partner with the retail power provider to carry
out this section.
(C) Up to 3 persons representing local nonprofit
conservation or environmental organizations. Preference
shall be given to those entities which are organized
under section 501(c)(3) of the Internal Revenue Code of
1986, and which have demonstrated expertise engaging
the public in energy conservation, energy efficiency,
or green building practices or a combination thereof,
such that no single organization is represented by more
than one individual under this paragraph.
(D) Up to 2 persons representing a local affordable
housing agency, affordable housing builder, or
community development corporation.
(E) Up to 3, but no less than one, persons
representing local city or county government for each
municipality where a shade tree-planting program will
take place; at least one of these representatives shall
be the city or county forester, city or county
arborist, or functional equivalent.
(F) Up to one person representing the local
government agency responsible for management of roads,
sewers, and infrastructure, including but not limited
to public works departments, transportation agencies,
or equivalents.
(G) Up to 3 persons representing the nursery and
landscaping industry.
(H) Up to 3 persons representing the research
community or academia with expertise in natural
resources or energy management issues.
(4) Chairperson.--Each local technical advisory committee
shall elect a chairperson to preside over Committee meetings,
act as a liaison to governmental and other outside entities,
and direct the general operation of the committee; only
committee representatives from paragraph (3)(A) or paragraph
(3)(B) of this subsection shall be eligible to act as local
technical advisory committee chairpersons.
(5) Credentials.--At least one of the members of each local
technical advisory committee shall be certified with one or
more of the following credentials: International Society of
Arboriculture; Certified Arborist, ISA; Certified Arborist
Municipal Specialist, ISA; Certified Arborist Utility
Specialist, ISA; Board Certified Master Arborist; or Registered
Landscape Architect recommended by the American Society of
Landscape Architects.
(g) Cost-share Program.--
(1) Federal share.--The Federal share of support for
projects funded under this section shall not exceed 50 percent
of the cost of such project and shall be provided on a matching
basis.
(2) Non-federal share.--The non-Federal share of such costs
may be paid or contributed by any governmental or
nongovernmental entity other than from funds derived directly
or indirectly from an agency or instrumentality of the United
States.
(h) Rulemaking.--
(1) Rulemaking period.--The Secretary shall be authorized
to solicit comments and initiate a rulemaking period that shall
last no more than 6 months after the date of enactment of this
section.
(2) Competitive grant rule.--At the conclusion of the
rulemaking period under paragraph (1), the Secretary shall
promulgate a rule governing a public, competitive grants
process through which retail power providers may apply for
Federal support under this section.
(i) Nonduplicity.--Nothing in this section shall be construed to
supersede, duplicate, cancel, or negate the programs or authorities
provided under section 9 of the Cooperative Forestry Assistance Act of
1978 (92 Stat. 369; Public Law 95-313; 16 U.S.C. 2105).
(j) Authorization of Appropriations.--There are hereby authorized
to be appropriated such sums as may be necessary for the implementation
of this section.
SEC. 206. ENERGY EFFICIENCY FOR DATA CENTER BUILDINGS.
Section 453(c)(1) of the Energy Independence and Security Act of
2007 (42 U.S.C. 17112(c)(1)) is amended by inserting ``but not later
than 2 years after the date of enactment of this Act'' after
``described in subsection (b)''.
SEC. 207. COMMUNITY BUILDING CODE ADMINISTRATION GRANTS.
(a) Grant Program Authorized.--
(1) Grant authorization.--The Secretary of Housing and
Urban Development shall to the extent amounts are made
available for grants under this section provide grants to local
building code enforcement departments.
(2) Competitive awards.--The Secretary shall award grants
under paragraph (1) on a competitive basis taking into
consideration the following:
(A) The financial need of each building code
enforcement department.
(B) The benefit to the jurisdiction of having an
adequately funded building code enforcement department.
(C) The demonstrated ability of each building code
enforcement department to work cooperatively with other
local code enforcement offices, health departments, and
local prosecutorial agencies.
(3) Maximum amount.--The maximum amount of any grant
awarded under this subsection shall not exceed $1,000,000.
(4) Coordination.--The Secretary of Housing and Urban
Development shall coordinate with the Secretary of Energy to
ensure that any unnecessarily duplicative funding through
grants under this section of activities otherwise funded
through the Department of Energy is minimized or eliminated.
(b) Required Elements in Grant Proposals.--In order to be eligible
for a grant under subsection (a), a building code enforcement
department of a jurisdiction shall submit to the Secretary the
following:
(1) A demonstration of the jurisdiction's needs in
executing building code enforcement administration.
(2) A plan for the use of any funds received from a grant
under this section that addresses the needs discussed in
paragraph (1) and that is consistent with the authorized uses
established in subsection (c).
(3) A plan for local governmental actions to be taken to
establish and sustain local building code enforcement
administration functions, without continuing Federal support,
at a level at least equivalent to that proposed in the grant
application.
(4) A plan to create and maintain a program of public
outreach that includes a regularly updated and readily
accessible means of public communication, interaction, and
reporting regarding the services and work of the building code
enforcement department to be supported by the grant.
(5) A plan for ensuring the timely and effective
administrative enforcement of building safety and fire
prevention violations.
(c) Use of Funds; Matching Funds.--
(1) Authorized uses.--Amounts from grants awarded under
subsection (a) may be used by the grant recipient to supplement
existing State or local funding for administration of building
code enforcement, or to supplement allowance value received
pursuant to this Act for implementation and enforcement of
energy efficiency building codes. Such amounts may be used to
increase staffing, provide staff training, increase staff
competence and professional qualifications, or support
individual certification or departmental accreditation, or for
capital expenditures specifically dedicated to the
administration of the building code enforcement department.
(2) Additional requirement.--Each building code enforcement
department receiving a grant under subsection (a) shall empanel
a code administration and enforcement team consisting of at
least 1 full-time building code enforcement officer, a city
planner, and a health planner or similar officer.
(3) Matching funds required.--
(A) In general.--To be eligible to receive a grant
under this section, a building code enforcement
department shall provide matching, non-Federal funds in
the following amount:
(i) In the case of a building code
enforcement department serving an area with a
population of more than 50,000, an amount equal
to not less than 50 percent of the total amount
of any grant to be awarded under this section.
(ii) In the case of a building code
enforcement department serving an area with a
population of between 20,001 and 50,000, an
amount equal to not less than 25 percent of the
total amount of any grant to be awarded under
this section.
(iii) In the case of a building code
enforcement department serving an area with a
population of less than 20,000, an amount equal
to not less than 12.5 percent of the total
amount of any grant to be awarded under this
section.
(B) Economic distress.--
(i) In general.--The Secretary may waive
the matching fund requirements under
subparagraph (A), and institute, by regulation,
new matching fund requirements based upon the
level of economic distress of the jurisdiction
in which the local building code enforcement
department seeking such grant is located.
(ii) Content of regulations.--Any
regulations instituted under clause (i) shall
include--
(I) a method that allows for a
comparison of the degree of economic
distress among the local jurisdictions
of grant applicants, as measured by the
differences in the extent of growth
lag, the extent of poverty, and the
adjusted age of housing in such
jurisdiction; and
(II) any other factor determined to
be relevant by the Secretary in
assessing the comparative degree of
economic distress among such
jurisdictions.
(4) In-kind contributions.--In determining the non-Federal
share required to be provided under paragraph (3), the
Secretary shall consider in-kind contributions, not to exceed
50 percent of the amount that the department contributes in
non-Federal funds.
(5) Waiver of matching requirement.--The Secretary shall
waive the matching fund requirements under paragraph (3) for
any recipient jurisdiction that has dedicated all building code
permitting fees to the conduct of local building code
enforcement.
(d) Evaluation and Report.--
(1) In general.--Grant recipients under this section
shall--
(A) be obligated to fully account and report for
the use of all grants funds; and
(B) provide a report to the Secretary on the
effectiveness of the program undertaken by the grantee
and any other criteria requested by the Secretary for
the purpose of indicating the effectiveness of, and
ideas for, refinement of the grant program.
(2) Report.--The report required under paragraph (1)(B)
shall include a discussion of--
(A) the specific capabilities and functions in
local building code enforcement administration that
were addressed using funds received under this section;
(B) the lessons learned in carrying out the plans
supported by the grant; and
(C) the manner in which the programs supported by
the grant are to be maintained by the grantee.
(3) Content of reports.--The Secretary shall--
(A) require each recipient of a grant under this
section to file interim and final reports under
paragraph (2) to ensure that grant funds are being used
as intended and to measure the effectiveness and
benefits of the grant program; and
(B) develop and maintain a means whereby the public
can access such reports, at no cost, via the Internet.
(e) Definitions.--For purposes of this section, the following
definitions shall apply:
(1) Building code enforcement.--The term ``building code
enforcement'' means the enforcement of any code, adopted by a
State or local government, that regulates the construction of
buildings and facilities to mitigate hazards to life or
property. Such term includes building codes, electrical codes,
energy codes, fire codes, fuel gas codes, mechanical codes, and
plumbing codes.
(2) Building code enforcement department.--The term
``building code enforcement department'' means an inspection or
enforcement agency of a jurisdiction that is responsible for
conducting building code enforcement.
(3) Jurisdiction.--The term ``jurisdiction'' means a city,
county, parish, city and county authority, or city and parish
authority having local authority to enforce building codes and
regulations and to collect fees for building permits.
(4) Secretary.--The term ``Secretary'' means the Secretary
of Housing and Urban Development.
(f) Authorization of Appropriations.--
(1) In general.--There are authorized to be appropriated
$20,000,000 for each of fiscal years 2010 through 2014 to the
Secretary of Housing and Urban Development to carry out the
provisions of this section.
(2) Reservation.--From the amount made available under
paragraph (1), the Secretary may reserve not more than 5
percent for administrative costs.
(3) Availability.--Any funds appropriated pursuant to
paragraph (1) shall remain available until expended.
SEC. 208. SOLAR ENERGY SYSTEMS BUILDING PERMIT REQUIREMENTS FOR RECEIPT
OF COMMUNITY DEVELOPMENT BLOCK GRANT FUNDS.
Section 104 of the Housing and Community Development Act of 1974
(42 U.S.C. 5304) is amended by adding at the end the following new
subsection:
``(n) Requirements for Building Permits Regarding Solar Energy
Systems.--
``(1) In general.--A grant under section 106 for a fiscal
year may be made only if the grantee certifies to the Secretary
that--
``(A) in the case of a grant under section 106(a)
for any Indian tribe or insular area, during such
fiscal year the cost of any permit or license, for
construction or installation of any solar energy system
for any structure, that is required by the tribe or
insular area or by any other unit of general local
government or other political subdivision of such tribe
or insular area, complies with paragraph (2);
``(B) in the case of a grant under section 106(b)
for any metropolitan city or urban county, during such
fiscal year the cost of any permit or license, for
construction or installation of any solar energy system
for any structure, that is required by the metropolitan
city or urban county, or by any other political
subdivision of such city or county, complies with
paragraph (2); and
``(C) in the case of a grant under section 106(d)
for any State, during such fiscal year the cost of any
permit or license, for construction or installation of
any solar energy system for any structure, that is
required by the State, or by any other unit of general
local government within any nonentitlement area of such
State, or other political subdivision within any
nonentitlement area of such State or such a unit of
general local government, complies with paragraph (2).
``(2) Limitation on cost.--The cost of permit or license
for construction or installation of any solar energy system
complies with this paragraph only if such cost does not exceed
the following amount:
``(A) Residential structures.--In the case of a
structure primarily for residential use, $500.
``(B) Nonresidential structures.--In the case of a
structure primarily for nonresidential use, 1.0 percent
of the total cost of the installation or construction
of the solar energy system, but not in excess of
$10,000.
``(3) Noncompliance.--If the Secretary determines that a
grantee of a grant made under section 106 is not in compliance
with a certification under paragraph (1)--
``(A) the Secretary shall notify the grantee of
such determination; and
``(B) if the grantee has not corrected such
noncompliance before the expiration of the 6-month
period beginning upon notification under subparagraph
(A), such grantee shall not be eligible for 5 percent
of any amounts awarded under a grant under section 106
for the first fiscal year that commences after the
expiration of such 6-month period.
``(4) Solar energy system.--For purposes of this
subsection, the term `solar energy system' means, with respect
to a structure, equipment that uses solar energy to generate
electricity for, or to heat or cool (or provide hot water for
use in), such structure.''.
SEC. 209. PROHIBITION OF RESTRICTIONS ON RESIDENTIAL INSTALLATION OF
SOLAR ENERGY SYSTEM.
(a) Regulations.--Within 180 days after the enactment of this Act,
the Secretary of Housing and Urban Development, in consultation with
the Secretary of Energy, shall issue regulations--
(1) to prohibit any private covenant, contract provision,
lease provision, homeowners' association rule or bylaw, or
similar restriction, that impairs the ability of the owner or
lessee of any residential structure designed for occupancy by 1
family to install, construct, maintain, or use a solar energy
system on such residential property; and
(2) to require that whenever any such covenant, provision,
rule or bylaw, or restriction requires approval for the
installation or use of a solar energy system, the application
for approval shall be processed and approved by the appropriate
approving entity in the same manner as an application for
approval of an architectural modification to the property, and
shall not be willfully avoided or delayed.
(b) Contents.--The regulations required under subsection (a) shall
provide that--
(1) such a covenant, provision, rule or bylaw, or
restriction impairs the installation, construction,
maintenance, or use of a solar energy system if it--
(A) unreasonably delays or prevents installation,
maintenance, or use;
(B) unreasonably increases the cost of
installation, maintenance, or use; or
(C) precludes use of such a system; and
(2) any fee or cost imposed on the owner or lessee of such
a residential structure by such a covenant, provision, rule or
bylaw, or restriction shall be considered unreasonable if--
(A) such fee or cost is not reasonable in
comparison to the cost of the solar energy system or
the value of its use; or
(B) treatment of solar energy systems by the
covenant, provision, rule or bylaw, or restriction is
not reasonable in comparison with treatment of
comparable systems by the same covenant, provision,
rule or bylaw, or restriction.
(c) Solar Energy System.--For purposes of this section, the term
``solar energy system'' means, with respect to a structure, equipment
that uses solar energy to generate electricity for, or to heat or cool
(or provide hot water for use in), such structure.
Subtitle B--Lighting and Appliance Energy Efficiency Programs
SEC. 211. LIGHTING EFFICIENCY STANDARDS.
(a) Outdoor Lighting.--
(1) Definitions.--
(A) Section 340(1) of the Energy Policy and
Conservation Act (42 U.S.C. 6311(1)) is amended by
striking subparagraph (L) and inserting the following:
``(L) Outdoor luminaires.
``(M) Outdoor high light output lamps.
``(N) Any other type of industrial equipment which
the Secretary classifies as covered equipment under
section 341(b).''.
(B) Section 340 of the Energy Policy and
Conservation Act (42 U.S.C. 6311) is amended as adding
at the end the following:
``(25) The term `luminaire' means a complete lighting unit
consisting of one or more light sources and ballast(s),
together with parts designed to distribute the light, to
position and protect such lamps, and to connect such light
sources to the power supply.
``(26) The term `outdoor luminaire' means a luminaire that
is listed as suitable for wet locations pursuant to
Underwriters Laboratories Inc. standard UL 1598 and is labeled
as `Suitable for Wet Locations' consistent with section
410.4(A) of the National Electrical Code 2005, or is designed
for roadway illumination and meets the requirements of Addendum
A for IESNA TM-15-07: Backlight, Uplight, and Glare (BUG)
Ratings, except for--
``(A) luminaires designed for outdoor video display
images that cannot be used in general lighting
applications;
``(B) portable luminaires designed for use at
construction sites;
``(C) luminaires designed for continuous immersion
in swimming pools and other water features;
``(D) seasonal luminaires incorporating solely
individual lamps rated at 10 watts or less;
``(E) luminaires designed to be used in emergency
conditions that incorporate a means of charging a
battery and a device to switch the power supply to
emergency lighting loads automatically upon failure of
the normal power supply;
``(F) components used for repair of installed
luminaries and that meet the requirements of section
342(h);
``(G) a luminaire utilizing an electrode-less
fluorescent lamp as the light source;
``(H) decorative gas lighting systems;
``(I) luminaires designed explicitly for lighting
for theatrical purposes, including performance, stage,
film production, and video production;
``(J) luminaires designed as theme elements in
theme/amusement parks and that cannot be used in most
general lighting applications;
``(K) luminaires designed explicitly for vehicular
roadway tunnels designed to comply with ANSI/IESNA RP-
22-05;
``(L) luminaires designed explicitly for hazardous
locations meeting UL Standard 844;
``(M) searchlights;
``(N) luminaires that are designed to be recessed
into a building, and that cannot be used in most
general lighting applications;
``(O) a luminaire rated only for residential
applications utilizing a light source or sources
regulated under the amendments made by section 321 of
the Energy Independence and Security Act of 2007 and
with a light output no greater than 2,600 lumens;
``(P) a residential pole-mounted luminaire that is
not rated for commercial use utilizing a light source
or sources meeting the efficiency requirements of
section 231 of the Energy Independence and Security Act
of 2007 and mounted on a post or pole not taller than
10.5 feet above ground and with a light output not
greater than 2,600 lumens;
``(Q) a residential fixture with E12 (Candelabra)
bases that is rated for not more than 300 watts total;
or
``(R) a residential fixture with medium screw bases
that is rated for not more than 145 watts.
``(27) The term `outdoor high light outputlamp' means a
lamp that--
``(A) has a rated lumen output not less than 2601
lumens;
``(B) is capable of being operated at a voltage not
less than 110 volts and not greater than 300 volts, or
driven at a constant current of 6.6 amperes;
``(C) is not a Parabolic Aluminized Reflector lamp;
and
``(D) is not a J-type double-ended (T-3) halogen
quartz lamp, utilizing R-7S bases, that is manufactured
before January 1, 2015.
``(28) The term `outdoor lighting control' means a device
incorporated in a luminaire that receives a signal, from either
a sensor (such as an occupancy sensor, motion sensor, or
daylight sensor) or an input signal (including analog or
digital signals communicated through wired or wireless
technology), and can adjust the light level according to the
signal.''.
(2) Standards.--Section 342 of the Energy Policy and
Conservation Act (42 U.S.C. 6313) is amended by adding at the
end the following:
``(g) Outdoor Luminaires.--
``(1) Each outdoor luminaire manufactured on or after
January 1, 2016, shall--
``(A) have an initial luminaire efficacy of at
least 50 lumens per watt; and
``(B) be designed to use a light source with a
lumen maintenance, calculated as mean rated lumens
divided by initial lumens, of at least 0.6.
``(2) Each outdoor luminaire manufactured on or after
January 1, 2018, shall--
``(A) have an initial luminaire efficacy of at
least 70 lumens per watt; and
``(B) be designed to use a light source with a
lumen maintenance, calculated as mean rated lumens
divided by initial lumens, of at least 0.6.
``(3) In addition to the requirements of paragraphs (1)
through (3), each outdoor luminaire manufactured on or after
January 1, 2016, shall have the capability of producing at
least two different light levels, including 100 percent and 60
percent of full lamp output as tested with the maximum rated
lamp per UL1598 or the manufacturer's maximum specified for the
luminaire under test. Outdoor luminaries used for roadway
lighting applications shall be exempt the 2 light level
requirement.
``(4)(A) Not later than January 1, 2022, the Secretary
shall issue a final rule amending the applicable standards
established in paragraph (3) if technologically feasible and
economically justified.
``(B) A final rule issued under subparagraph (A) shall
establish efficiency standards at the maximum level that is
technically feasible and economically justified, as provided in
subsections (o) and (p) of section 325. The Secretary may also,
in such rulemaking, amend or discontinue the product exclusions
listed in section 340(26)(A) through (P), or amend the lumen
maintenance requirements in paragraph (2) if the Secretary
determines that such amendments are consistent with the
purposes of this Act.
``(C) If the Secretary issues a final rule under
subparagraph (A) establishing amended standards, the final rule
shall provide that the amended standards apply to products
manufactured on or after January 1, 2025, or 1 year after the
date on which the final amended standard is published,
whichever is later.
``(h) Outdoor High Light Output Lamps.--Each outdoor high light
output lamp manufactured on or after January 1, 2017, shall have a
lighting efficiency of at least 45 lumens per watt.''.
(3) Test procedures.--Section 343(a) of the Energy Policy
and Conservation Act (42 U.S.C. 6314(a)) is amended by adding
at the end the following:
``(10) Outdoor lighting.--
``(A) With respect to outdoor luminaires and
outdoor high light output lamps, the test procedures
shall be based upon the test procedures specified in
illuminating engineering society procedures LM-79 as of
March 1, 2009, and LM-31, and/or other appropriate
consensus test procedures developed by the Illuminating
Engineering Society or other appropriate consensus
standards bodies.
``(B) If illuminating engineering society procedure
LM-79 is amended, the Secretary shall amend the test
procedures established in subparagraph (A) as necessary
to be consistent with the amended LM-79 test procedure,
unless the Secretary determines, by rule, published in
the Federal Register and supported by clear and
convincing evidence, that to do so would not meet the
requirements for test procedures under paragraph (2).
``(C) The Secretary may revise the test procedures
for outdoor luminaires or outdoor high light output
lamps by rule consistent with paragraph (2), and may
incorporate as appropriate consensus test procedures
developed by the Illuminating Engineering Society or
other appropriate consensus standards bodies.''.
(4) Preemption.--Section 345 of the Energy Policy and
Conservation Act (42 U.S.C. 6316) is amended by adding at the
end the following:
``(i)(1) Except as provided in paragraph (2), section 327 shall
apply to outdoor luminaires to the same extent and in the same manner
as the section applies under part B.
``(2) Any State standard that is adopted on or before January 1,
2015, pursuant to a statutory requirement to adopt efficiency standards
for reducing outdoor lighting energy use enacted prior to January 31,
2008, shall not be preempted.''.
(5) Energy efficiency standards for certain luminaires.--
Not later than 1 year after the date of enactment of this Act,
the Secretary of Energy shall, in consultation with the
National Electrical Manufacturers Association, collect data for
United States sales of luminaires described in section
340(26)(H) and (M) of the Energy Policy and Conservation Act,
to determine the historical growth rate. If the Secretary finds
that the growth in market share of such luminaires exceeds
twice the year-to-year rate of the average of the previous 3
years, then the Secretary shall within 12 months initiate a
rulemaking to determine if such exclusion should be eliminated,
if substitute products exist that perform more efficiently and
fulfill the performance functions of these luminaires.
(b) Portable Lighting.--
(1) Portable light fixtures.--
(A) Definitions.--Section 321 of the Energy Policy
and Conservation Act (42 U.S.C. 6291) is amended by
adding at the end the following:
``(67) Art work light fixture.--The term `art work light
fixture' means a light fixture designed only to be mounted
directly to an art work and for the purpose of illuminating
that art work.
``(68) LED light engine.--The term `LED light engine' or
`LED light engine with integral heat sink' means a subsystem of
an LED light fixture that--
``(A) includes 1 or more LED components,
including--
``(i) an LED driver power source with
electrical and mechanical interfaces; and
``(ii) an integral heat sink to provide
thermal dissipation; and
``(B) may be designed to accept additional
components that provide aesthetic, optical, and
environmental control.
``(69) LED light fixture.--The term `LED light fixture'
means a complete lighting unit consisting of--
``(A) an LED light source with 1 or more LED lamps
or LED light engines; and
``(B) parts--
``(i) to distribute the light;
``(ii) to position and protect the light
source; and
``(iii) to connect the light source to
electrical power.
``(70) Light fixture.--The term `light fixture' means a
product designed to provide light that includes--
``(A) at least 1 lamp socket; and
``(B) parts--
``(i) to distribute the light;
``(ii) position and protect 1 or more
lamps; and
``(iii) to connect 1 or more lamps to a
power supply.
``(71) Portable light fixture.--
``(A) In general.--The term `portable light
fixture' means a light fixture that has a flexible cord
and an attachment plug for connection to a nominal 120-
volt circuit that--
``(i) allows the user to relocate the
product without any rewiring; and
``(ii) typically can be controlled with a
switch located on the product or the power cord
of the product.
``(B) Exclusions.--The term `portable light
fixture' does not include--
``(i) direct plug-in night lights, sun or
heat lamps, medical or dental lights, portable
electric hand lamps, signs or commercial
advertising displays, photographic lamps,
germicidal lamps, or light fixtures for marine
use or for use in hazardous locations (as those
terms are defined in ANSI/NFPA 70 of the
National Electrical Code); or
``(ii) decorative lighting strings,
decorative lighting outfits, or electric
candles or candelabra without lamp shades that
are covered by Underwriter Laboratories (UL)
standard 588, `Seasonal and Holiday Decorative
Products'.''.
(B) Coverage.--
(i) In general.--Section 322(a) of the
Energy Policy and Conservation Act (42 U.S.C.
6292(a)) is amended--
(I) by redesignating paragraph (20)
as paragraph (24); and
(II) by inserting after paragraph
(19) the following:
``(20) Portable light fixtures.''.
(ii) Conforming amendments.--Section 325(l)
of the Energy Policy and Conservation Act (42
U.S.C. 6295(l)) is amended by striking
``paragraph (19)'' each place it appears in
paragraphs (1) and (2) and inserting
``paragraph (24)''.
(C) Test procedures.--Section 323(b) of the Energy
Policy and Conservation Act (42 U.S.C. 6293(b)) is
amended by adding at the end the following:
``(19) LED fixtures and led light engines.--Test procedures
for LED fixtures and LED light engines shall be based on
Illuminating Engineering Society of North America (IESNA) test
procedure LM-79, Approved Method for Electrical and Photometric
Testing of Solid-State Lighting Devices, and IESNA-approved
test procedure for testing LED light engines.''.
(D) Standards.--Section 325 of the Energy Policy
and Conservation Act (42 U.S.C. 6295) is amended--
(i) by redesignating subsection (ii) as
subsection (oo);
(ii) in subsection (oo)(2), as redesignated
in clause (i) of this subparagraph, by striking
``(hh)'' each place it appears and inserting
``(mm)''; and
(iii) by inserting after subsection (hh)
the following:
``(ii) Portable Light Fixtures.--
``(1) In general.--Subject to paragraphs (2) and (3),
portable light fixtures manufactured on or after January 1,
2012, shall meet 1 or more of the following requirements:
``(A) Be a fluorescent light fixture that meets the
requirements of the Energy Star Program for Residential
Light Fixtures, Version 4.2.
``(B) Be equipped with only 1 or more GU-24 line-
voltage sockets, not be rated for use with incandescent
lamps of any type (as defined in ANSI standards), and
meet the requirements of version 4.2 of the Energy Star
program for residential light fixtures.
``(C) Be an LED light fixture or a light fixture
with an LED light engine and comply with the following
minimum requirements:
``(i) Minimum light output: 200 lumens
(initial).
``(ii) Minimum LED light engine efficacy:
40 lumens/watt installed in fixtures that meet
the minimum light fixture efficacy of 29
lumens/watt or, alternatively, a minimum LED
light engine efficacy of 60 lumens/watt for
fixtures that do not meet the minimum light
fixture efficacy of 29 lumens/watt.
``(iii) All portable fixtures shall have a
minimum LED light fixture efficacy of 29
lumens/watt and a minimum LED light engine
efficacy of 60 lumens/watt by January 1, 2016.
``(iv) Color Correlated Temperature (CCT):
2700K through 4000K.
``(v) Minimum Color Rendering Index (CRI):
75.
``(vi) Power factor equal to or greater
than 0.70.
``(vii) Portable luminaries that have
internal power supplies shall have zero standby
power when the luminaire is turned off.
``(viii) LED light sources shall deliver at
least 70 percent of initial lumens for at least
25,000 hours.
``(D)(i) Be equipped with an ANSI-designated E12,
E17, or E26 screw-based socket and be prepackaged and
sold together with 1 screw-based compact fluorescent
lamp or screw-based LED lamp for each screw-based
socket on the portable light fixture.
``(ii) The compact fluorescent or LED lamps
prepackaged with the light fixture shall be fully
compatible with any light fixture controls incorporated
into the light fixture (for example, light fixtures
with dimmers shall be packed with dimmable lamps).
``(iii) Compact fluorescent lamps prepackaged with
light fixtures shall meet the requirements of the
Energy Star Program for CFLs Version 4.0.
``(iv) Screw-based LED lamps shall comply with the
minimum requirements described in subparagraph (C).
``(E) Be equipped with 1 or more single-ended, non-
screw based halogen lamp sockets (line or low voltage),
a dimmer control or high-low control, and be rated for
a maximum of 100 watts.
``(2) Review.--
``(A) Review.--The Secretary shall review the
criteria and standards established under paragraph (1)
to determine if revised standards are technologically
feasible and economically justified.
``(B) Components.--The review shall include
consideration of--
``(i) whether a separate compliance
procedure is still needed for halogen fixtures
described in subparagraph (E) and, if
necessary, what an appropriate standard for
halogen fixtures shall be;
``(ii) whether the specific technical
criteria described in subparagraphs (A), (C),
and (D)(iii) should be modified; and
``(iii) which fixtures should be exempted
from the light fixture efficacy standard as of
January 1, 2016, because the fixtures are
primarily decorative in nature (as defined by
the Secretary) and, even if exempted, are
likely to be sold in limited quantities.
``(C) Timing.--
``(i) Determination.--Not later than
January 1, 2014, the Secretary shall publish
amended standards, or a determination that no
amended standards are justified, under this
subsection.
``(ii) Standards.--Any standards under this
paragraph shall take effect on January 1, 2016.
``(3) Art work light fixtures.--Art work light fixtures
manufactured on or after January 1, 2012, shall--
``(A) comply with paragraph (1); or
``(B)(i) contain only ANSI-designated E12 screw-
based line-voltage sockets;
``(ii) have not more than 3 sockets;
``(iii) be controlled with an integral high/low
switch;
``(iv) be rated for not more than 25 watts if
fitted with 1 socket; and
``(v) be rated for not more than 15 watts per
socket if fitted with 2 or 3 sockets.
``(4) Exception from preemption.--Notwithstanding section
327, Federal preemption shall not apply to a regulation
concerning portable light fixtures adopted by the California
Energy Commission on or before January 1, 2014.''.
(2) GU-24 base lamps.--
(A) Definitions.--Section 321 of the Energy Policy
and Conservation Act (42 U.S.C. 6291) (as amended by
paragraph (1)(A)) is amended by adding at the end the
following:
``(72) GU-24.--The term `GU-24' means the designation of a
lamp socket, based on a coding system by the International
Electrotechnical Commission, under which--
``(A) `G' indicates a holder and socket type with 2
or more projecting contacts, such as pins or posts;
``(B) `U' distinguishes between lamp and holder
designs of similar type that are not interchangeable
due to electrical or mechanical requirements; and
``(C) 24 indicates the distance in millimeters
between the electrical contact posts.
``(73) GU-24 adaptor.--
``(A) In general.--The term `GU-24 Adaptor' means a
1-piece device, pig-tail, wiring harness, or other such
socket or base attachment that--
``(i) connects to a GU-24 socket on 1 end
and provides a different type of socket or
connection on the other end; and
``(ii) does not alter the voltage.
``(B) Exclusion.--The term `GU-24 Adaptor' does not
include a fluorescent ballast with a GU-24 base.
``(74) GU-24 base lamp.--`GU-24 base lamp' means a light
bulb designed to fit in a GU-24 socket.''.
(B) Standards.--Section 325 of the Energy Policy
and Conservation Act (42 U.S.C. 6295) (as amended by
paragraph (1)(D)) is amended by inserting after
subsection (ii) the following:
``(jj) GU-24 Base Lamps.--
``(1) In general.--A GU-24 base lamp shall not be an
incandescent lamp as defined by ANSI.
``(2) GU-24 adaptors.--GU-24 adaptors shall not adapt a GU-
24 socket to any other line voltage socket.''.
(3) Standards for certain incandescent reflector lamps.--
Section 325(i) of the Energy Policy and Conservation Act (42
U.S.C. 6295(i)), as amended by section 161(a)(12) of this Act,
is amended by adding at the end the following:
``(9) Certain incandescent reflector lamps.--(A) No later
than 12 months after enactment of this paragraph, the Secretary
shall publish a final rule establishing standards for
incandescent reflector lamp types described in paragraph
(1)(D). Such standards shall be effective on July 1, 2013.
``(B) Any rulemaking for incandescent reflector lamps
completed after enactment of this section shall consider
standards for all incandescent reflector lamps, inclusive of
those specified in paragraph (1)(C).
``(10) Reflector lamps.--No later than January 1, 2015, the
Secretary shall publish a final rule establishing and amending
standards for reflector lamps, including incandescent reflector
lamps. Such standards shall be effective no sooner than 3 years
after publication of the final rule. Such rulemaking shall
consider incandescent and nonincandescent technologies. Such
rulemaking shall consider a new metric other than lumens-per-
watt based on the photometric distribution of light from such
lamps.''.
SEC. 212. OTHER APPLIANCE EFFICIENCY STANDARDS.
(a) Standards for Water Dispensers, Hot Food Holding Cabinets, and
Portable Electric Spas.--
(1) Definitions.--Section 321 of the Energy Policy and
Conservation Act (42 U.S.C. 6291), as amended by section 211 of
this Act, is further amended by adding at the end the
following:
``(75) The term `water dispenser' means a factory-made
assembly that mechanically cools and heats potable water and
that dispenses the cooled or heated water by integral or remote
means.
``(76) The term `bottle-type water dispenser' means a
drinking water dispenser designed for dispensing both hot and
cold water that uses a removable bottle or container as the
source of potable water.
``(77) The term `commercial hot food holding cabinet' means
a heated, fully-enclosed compartment with one or more solid or
glass doors that is designed to maintain the temperature of hot
food that has been cooked in a separate appliance. Such term
does not include heated glass merchandising cabinets, drawer
warmers, commercial hot food holding cabinets with interior
volumes of less than 8 cubic feet, or cook-and-hold appliances.
``(78) The term `portable electric spa' means a factory-
built electric spa or hot tub, supplied with equipment for
heating and circulating water.''.
(2) Coverage.--Section 322(a) of the Energy Policy and
Conservation Act (42 U.S.C. 6292(a)), as amended by section
211(b)(1)(B) of this Act, is further amended by inserting after
paragraph (20) the following new paragraphs:
``(21) Bottle type water dispensers.
``(22) Commercial hot food holding cabinets.
``(23) Portable electric spas.''.
(3) Test procedures.--Section 323(b) of the Energy Policy
and Conservation Act (42 U.S.C. 6293(b)), as amended by section
211(b)(1)(C) of this Act, is further amended by adding at the
end the following:
``(20) Bottle type water dispensers.--Test procedures for
bottle type water dispensers shall be based on `Energy Star
Program Requirements for Bottled Water Coolers version 1.1'
published by the Environmental Protection Agency. Units with an
integral, automatic timer shall not be tested using section 4D,
`Timer Usage,' of the test criteria.
``(21) Commercial hot food holding cabinets.--Test
procedures for commercial hot food holding cabinets shall be
based on the test procedures described in ANSI/ASTM F2140-01
(Test for idle energy rate-dry test). Interior volume shall be
based on the method shown in the Environmental Protection
Agency's `Energy Star Program Requirements for Commercial Hot
Food Holding Cabinets' as in effect on August 15, 2003.
``(22) Portable electric spas.--Test procedures for
portable electric spas shall be based on the test method for
portable electric spas contained in section 1604, title 20,
California Code of Regulations as amended on December 3, 2008.
When the American National Standards Institute publishes a test
procedure for portable electric spas, the Secretary shall
revise the Department of Energy's procedure.''.
(4) Standards.--Section 325 of the Energy Policy and
Conservation Act (42 U.S.C. 6295), as amended by section 211 of
this Act, is further amended by adding after subsection (jj)
the following:
``(kk) Bottle Type Water Dispensers.--Effective January 1, 2012,
bottle-type water dispensers designed for dispensing both hot and cold
water shall not have standby energy consumption greater than 1.2
kilowatt-hours per day.
``(ll) Commercial Hot Food Holding Cabinets.--Effective January 1,
2012, commercial hot food holding cabinets with interior volumes of 8
cubic feet or greater shall have a maximum idle energy rate of 40 watts
per cubic foot of interior volume.
``(mm) Portable Electric Spas.--Effective January 1, 2012, portable
electric spas shall not have a normalized standby power greater than
5(V\2/3\) Watts where V=the fill volume in gallons.
``(nn) Revisions.--The Secretary of Energy shall consider revisions
to the standards in subsections (kk), (ll), and (mm) in accordance with
subsection (o) and publish a final rule no later than January 1, 2013
establishing such revised standards, or make a finding that no
revisions are technically feasible and economically justified. Any such
revised standards shall take effect January 1, 2016.''.
(b) Commercial Furnace Efficiency Standards.--Section 342(a) of the
Energy Policy and Conservation Act (42 U.S.C. 6312(a)) is amended by
inserting after paragraph (10) the following new paragraph:
``(11) Warm air furnaces.--Each warm air furnace with an
input rating of 225,000 Btu per hour or more and manufactured
after January 1, 2011, shall meet the following standard
levels:
``(A) Gas-fired units.--
``(i) Minimum thermal efficiency of 80
percent.
``(ii) Include an interrupted or
intermittent ignition device.
``(iii) Have jacket losses not exceeding
0.75 percent of the input rating.
``(iv) Have either power venting or a flue
damper.
``(B) Oil-fired units.--
``(i) Minimum thermal efficiency of 81
percent.
``(ii) Have jacket losses not exceeding
0.75 percent of the input rating.
``(iii) Have either power venting or a flue
damper.''.
SEC. 213. APPLIANCE EFFICIENCY DETERMINATIONS AND PROCEDURES.
(a) Definition of Energy Conservation Standard.--Section 321(6) of
the Energy Policy and Conservation Act (42 U.S.C. 6291(6)) is amended
to read as follows:
``(6) Energy conservation standard.--
``(A) In general.--The term `energy conservation
standard' means 1 or more performance standards that--
``(i) for covered products (excluding
clothes washers, dishwashers, showerheads,
faucets, water closets, and urinals), prescribe
a minimum level of energy efficiency or a
maximum quantity of energy use, determined in
accordance with test procedures prescribed
under section 323;
``(ii) for showerheads, faucets, water
closets, and urinals, prescribe a minimum level
of water efficiency or a maximum quantity of
water use, determined in accordance with test
procedures prescribed under section 323; and
``(iii) for clothes washers and
dishwashers--
``(I) prescribe a minimum level of
energy efficiency or a maximum quantity
of energy use, determined in accordance
with test procedures prescribed under
section 323; and
``(II) may include a minimum level
of water efficiency or a maximum
quantity of water use, determined in
accordance with those test procedures.
``(B) Inclusions.--The term `energy conservation
standard' includes--
``(i) 1 or more design requirements, if the
requirements were established--
``(I) on or before the date of
enactment of this subclause;
``(II) as part of a direct final
rule under section 325(p)(4); or
``(III) as part of a final rule
published on or after January 1, 2012,
and
``(ii) any other requirements that the
Secretary may prescribe under section 325(r).
``(C) Exclusion.--The term `energy conservation
standard' does not include a performance standard for a
component of a finished covered product, unless
regulation of the component is specifically authorized
or established pursuant to this title.''.
(b) Adopting Consensus Test Procedures and Test Procedures in Use
Elsewhere.--Section 323(b) of the Energy Policy and Conservation Act
(42 U.S.C. 6293(b)), as amended by sections 211 and 212 of this Act, is
further amended by adding the following new paragraph after paragraph
(22):
``(23) Consensus and alternate test procedures.--
``(A) Receipt of joint recommendation or alternate
testing procedure.--On receipt of--
``(i) a statement that is submitted jointly
by interested persons that are fairly
representative of relevant points of view
(including representatives of manufacturers of
covered products, States, and efficiency
advocates), as determined by the Secretary, and
contains recommendations with respect to the
testing procedure for a covered product; or
``(ii) a submission of a testing procedure
currently in use for a covered product by a
State, nation, or group of nations--
``(I) if the Secretary determines
that the recommended testing procedure
contained in the statement or
submission is in accordance with
subsection (b)(3), the Secretary may
issue a final rule that establishes an
energy or water conservation testing
procedure that is published
simultaneously with a notice of
proposed rulemaking that proposes a new
or amended energy or water conservation
testing procedure that is identical to
the testing procedure established in
the final rule to establish the
recommended testing procedure (referred
to in this paragraph as a `direct final
rule'); or
``(II) if the Secretary determines
that a direct final rule cannot be
issued based on the statement or
submission, the Secretary shall publish
a notice of the determination, together
with an explanation of the reasons for
the determination.
``(B) Public comment.--The Secretary shall solicit
public comment for a period of at least 110 days with
respect to each direct final rule issued by the
Secretary under subparagraph (A)(ii)(I).
``(C) Withdrawal of direct final rules.--
``(i) In general.--Not later than 120 days
after the date on which a direct final rule
issued under subparagraph (A)(ii)(I) is
published in the Federal Register, the
Secretary shall withdraw the direct final rule
if--
``(I) the Secretary receives 1 or
more adverse public comments relating
to the direct final rule under
subparagraph (B)or any alternative
joint recommendation; and
``(II) based on the rulemaking
record relating to the direct final
rule, the Secretary determines that
such adverse public comments or
alternative joint recommendation may
provide a reasonable basis for
withdrawing the direct final rule under
paragraph (3) or any other applicable
law.
``(ii) Action on withdrawal.--On withdrawal
of a direct final rule under clause (i), the
Secretary shall--
``(I) proceed with the notice of
proposed rulemaking published
simultaneously with the direct final
rule as described in subparagraph
(A)(ii)(I); and
``(II) publish in the Federal
Register the reasons why the direct
final rule was withdrawn.
``(iii) Treatment of withdrawn direct final
rules.--A direct final rule that is withdrawn
under clause (i) shall not be considered to be
a final rule for purposes of subsection (b).
``(D) Effect of paragraph.--Nothing in this
paragraph authorizes the Secretary to issue a direct
final rule based solely on receipt of more than 1
statement containing recommended test procedures
relating to the direct final rule.''.
(c) Updating Television Test Methods.--Section 323(b) of the Energy
Policy and Conservation Act (42 U.S.C. 6293(b)), as amended by sections
211 and 212 of this Act, and subsection (b) of this section, is further
amended by adding at the end the following new paragraph:
``(24) Televisions.--(A) On the date of enactment of this
paragraph, Appendix H to Subpart B of Part 430 of the United
States Code of Federal Regulations, `Uniform Test Method for
Measuring the Energy Consumption of Television Sets', is
repealed.
``(B) No later than 12 months after the date of enactment
of this paragraph the Secretary shall publish in the Federal
Register a final rule prescribing a new test method for
televisions.''.
(d) Criteria for Prescribing New or Amended Standards.--(1) Section
325(o)(2)(B)(i) of the Energy Policy and Conservation Act (42 U.S.C.
6295(o)(2)(B)(i)) is amended as follows:
(A) By striking ``and'' at the end of subclause (VI).
(B) By redesignating subclause (VII) as subclause (XI).
(C) By inserting the following new subclauses after
subclause (VI):
``(VII) the estimated value of the carbon dioxide and other
emission reductions that will be achieved by virtue of the
higher energy efficiency of the covered products resulting from
the imposition of the standard;
``(VIII) the estimated impact of standards for a particular
product on average consumer energy prices;
``(IX) the increased energy efficiency that may be
attributable to the installation of Smart Grid technologies or
capabilities in the covered products, if applicable in the
determination of the Secretary;
``(X) the availability in the United States or in other
nations of examples or prototypes of covered products that
achieve significantly higher efficiency standards for energy or
for water; and''.
(2) Section 325(o)(2)(B)(iii) of such Act is amended as follows:
(A) By striking ``three'' and inserting ``5''.
(B) By inserting after the first sentence the following
``For products with an average expected useful life of less
than 5 years, such rebuttable presumption shall be determined
utilizing 75 percent of the product's average expected useful
life as a multiplier instead of 5.''.
(C) By striking the last sentence and inserting the
following: ``Such a presumption may be rebutted only if the
Secretary finds, based on clear, convincing, and reliable
evidence, that--
``(I) such standard level would cause serious and
unavoidable hardship to the average consumer of the product, or
to manufacturers supplying a significant portion of the market
for the product, that substantially outweighs the standard
level's benefits;
``(II) the standard and implementing regulations cannot be
designed to avoid or mitigate the hardship identified under
subclause (I), through the adoption of regional standards
consistent with paragraph (6) of this subsection, or other
reasonable means consistent with this part;
``(III) the same or substantially similar hardship would
not occur under a standard adopted in the absence of the
presumption, but that otherwise meets the requirements of this
section; and
``(IV) the hardship cannot be avoided or mitigated pursuant
the procedures specified in section 504 of the Department of
Energy Organization Act (42 U.S.C. 7194).
A determination by the Secretary that the criteria triggering such
presumption are not met, or that the criterion for rebutting the
presumption are met shall not be taken into consideration in the
Secretary's determination of whether a standard is economically
justified.''.
(e) Obtaining Appliance Information From Manufacturers.--Section
326(d) of the Energy Policy and Conservation Act (42 U.S.C. 6295(d)) is
amended to read as follows:
``(d) Information Requirements.--(1) For purposes of carrying out
this part, the Secretary shall publish proposed regulations not later
than 1 year after the date of enactment of the American Clean Energy
and Security Act of 2009, and after receiving public comment, final
regulations not later than 18 months from such date of enactment under
this part or other provision of law administered by the Secretary,
which shall require each manufacturer of a covered product to submit
information or reports to the Secretary on an annual basis in a form
adopted by the Secretary. Such reports shall include information or
data with respect to--
``(A) the manufacturers' compliance with all requirements
applicable pursuant to this part;
``(B) the economic impact of any proposed energy
conservation standard;
``(C) the manufacturers' annual shipments of each class or
category of covered products, organized, to the maximum extent
practicable, by--
``(i) energy efficiency, energy use, and, if
applicable, water use;
``(ii) the presence or absence of such efficiency
related or energy consuming operational characteristics
or components as the Secretary determines are relevant
for the purposes of carrying out this part; and
``(iii) the State or regional location of sale, for
covered products for which the Secretary may adopt
regional standards; and
``(D) such other categories of information as the Secretary
deems relevant to carry out this part, including such other
information as may be necessary to establish and revise test
procedures, labeling rules, and energy conservation standards
and to insure compliance with the requirements of this part.
``(2) In adopting regulations under this subsection, the Secretary
shall consider existing public sources of information, including
nationally recognized certification programs of trade associations.
``(3) The Secretary shall exercise authority under this section in
a manner designed to minimize unnecessary burdens on manufacturers of
covered products.
``(4) To the extent that they do not conflict with the duties of
the Secretary in carrying out this part, the provisions of section
11(d) of the Energy Supply and Environmental Coordination Act of 1974
(15 U.S.C. 796(d)) shall apply with respect to information obtained
under this subsection to the same extent and in the same manner as they
apply with respect to other energy information obtained under such
section.''.
(f) State Waiver.--Section 327(c) of the Energy Policy and
Conservation Act (42 U.S.C. 6297(c)), as amended by section 161(a)(19)
of this Act, is further amended by adding at the end the following:
``(12) is a regulation concerning standards for hot food
holding cabinets, drinking water dispensers and portable
electric spas adopted by the California Energy Commission on or
before January 1, 2013.''.
(g) Waiver of Federal Preemption.--Paragraph (1) of section 327(d)
of the Energy Policy and Conservation Act (42 U.S.C. 6297(d)) is
amended as follows:
(1) In subparagraph (A) by striking ``State regulation''
each place it appears and inserting ``State statute or
regulation''.
(2) In subparagraph (B) by adding at the end the following
new sentence: ``In making such a finding, the Secretary may not
reject a petition for failure of the petitioning State or river
basin commission to produce confidential information maintained
by any manufacturer or distributor, or group or association of
manufacturers or distributors, and which the petitioning party
does not have the legal right to obtain.''.
(3) In clause (ii) of subparagraph (C) by striking
``costs'' each place it appears and inserting ``estimated
costs''.
(4) In subparagraph (C) by striking ``within the context of
the State's energy plan and forecast, and,''.
(h) Inclusion of Carbon Output on Appliance ``Energyguide''
Labels.--(1) Section 324(a)(2) of the Energy Policy and Conservation
Act (42 U.S.C. 6294(a)(2)) is amended by adding the following at the
end:
``(I)(i) Not later than 90 days after the date of enactment of this
subparagraph, the Commission shall initiate a rulemaking to implement
the additional labeling requirements specified in subsection (c)(1)(C)
of this section with an effective date for the revised labeling
requirement not later than 12 months from issuance of the final rule.
``(ii) Not later than 24 months after the date of enactment of this
subparagraph, the Commission shall complete the rulemaking initiated
under clause (i).
``(iii) Not later than 90 days after issuance of the final rule as
provided in this subparagraph, the Secretary shall issue calculation
methods required to effectuate the labeling requirements specified in
subsection (c)(1)(C) of this section.''.
(2) Section 324(c)(1) of the Energy Policy and Conservation Act (42
U.S.C. 6294(c)(1)) is amended--
(A) by striking ``and'' at the end of subparagraph (A);
(B) by striking the period at the end of subparagraph (B)
and inserting a semicolon; and
(C) by adding at the end the following new subparagraphs:
``(C) for products or groups of products providing a
comparable function (including the group of products comprising
the heating function of heat pumps and furnaces) among covered
products listed in paragraphs (3), (4), (5), (8), (9), (10),
and (11) of section 322(a) of this part, and others designated
by the Secretary, the estimated total annual atmospheric carbon
dioxide emissions (or their equivalent in other greenhouse
gases) associated with, or caused by, the product, calculated
utilizing--
``(i) national average energy use for the product
including energy consumed at the point of end use based
on test procedures developed under section 323 of this
part;
``(ii) national average energy consumed or lost in
the production, generation, transportation, storage,
and distribution of energy to the point of end use; and
``(iii) any direct emissions of greenhouse gases
from the product during normal use;
``(D) in determining the national average energy
consumption and total annual atmospheric carbon dioxide
emissions, the Secretary shall utilize Federal
Government sources, including the Energy Information
Administration Annual Energy Review, the Environmental
Protection Agency eGRID database, Environmental
Protection Agency AP-42 Emission Factors as amended,
and other sources determined to be appropriate by the
Secretary; and
``(E) information presenting, for each product (or
group of products providing the comparable function)
identified in section (c)(1)(C) of this section, the
estimated annual carbon dioxide emissions calculated
within the range of emissions calculated for all models
of the product or group according to its function,
including those models consuming fuels and those models
not consuming fuels.''.
(i) Permitting States to Seek Injunctive Enforcement.--(1) Section
334 of the Energy Policy and Conservation Act (42 U.S.C. 6304) is
amended to read as follows:
``SEC. 334. JURISDICTION AND VENUE.
``(a) Jurisdiction.--The United States district courts shall have
jurisdiction to restrain--
``(1) any violation of section 332; and
``(2) any person from distributing in commerce any covered
product which does not comply with an applicable rule under
section 324 or 325.
``(b) Authority.--Any action referred to in subsection (a) shall be
brought by the Commission or by the attorney general of a State in the
name of the State, except that--
``(1) any such action to restrain any violation of section
332(a)(3) which relates to requirements prescribed by the
Secretary or any violation of section 332(a)(4) which relates
to request of the Secretary under section 326(b)(2) shall be
brought by the Secretary; and
``(2) any violation of section 332(a)(5) or 332(a)(7) shall
be brought by the Secretary or by the attorney general of a
State in the name of the State.
``(c) Venue and Service of Process.--Any such action may be brought
in the United States district court for a district wherein any act,
omission, or transaction constituting the violation occurred, or in
such court of the district wherein the defendant is found or transacts
business. In any action under this section, process may be served on a
defendant in any other district in which the defendant resides or may
be found.''.
(2) The item relating to section 334 in the table of contents for
such Act is amended to read as follows:
``Sec. 334. Jurisdiction and venue.''.
(j) Treatment of Appliances Within Building Codes.--(1) Section
327(f)(3) of the Energy Policy and Conservation Act (42 U.S.C.
6297(f)(3)) is amended by striking subparagraphs (B) through (G) and
inserting the following:
``(B) The code meets at least one of the following
requirements:
``(i) The code does not require that the covered
product have an energy efficiency exceeding--
``(I) the applicable energy conservation
standard established in or prescribed under
section 325;
``(II) the level required by a regulation
of that State for which the Secretary has
issued a rule granting a waiver under
subsection (d) of this section; or
``(III) the required level established in
the International Energy Conservation Code or
in a standard of the American Society of
Heating, Refrigerating and Air-Conditioning
Engineers, or by the Secretary pursuant to
section 304 of the Energy Conservation and
Production Act.
``(ii) If the code uses one or more baseline
building designs against which all submitted building
designs are to be evaluated and such baseline building
designs contain a covered product subject to an energy
conservation standard established in or prescribed
under section 325, the baseline building designs are
based on an efficiency level for such covered product
which meets but does not exceed one of the levels
specified in clause (i).
``(iii) If the code sets forth one or more optional
combinations of items which meet the energy consumption
or conservation objective, in at least one combination
that the State has found to be reasonably achievable
using commercially available technologies the
efficiency of the covered product meets but does not
exceed one of the levels specified in clause (i).
``(C) The credit to the energy consumption or conservation
objective allowed by the code for installing covered products
having energy efficiencies exceeding one of the levels
specified in subparagraph (B)(i) is on a one-for-one equivalent
energy use or equivalent energy cost basis, taking into account
the typical lifetime of the product.
``(D) The energy consumption or conservation objective is
specified in terms of an estimated total consumption of energy
(which may be calculated from energy loss- or gain-based codes)
utilizing an equivalent amount of energy (which may be
specified in units of energy or its equivalent cost) and
equivalent lifetimes.
``(E) The estimated energy use of any covered product
permitted or required in the code, or used in calculating the
objective, is determined using the applicable test procedures
prescribed under section 323, except that the State may permit
the estimated energy use calculation to be adjusted to reflect
the conditions of the areas where the code is being applied if
such adjustment is based on the use of the applicable test
procedures prescribed under section 323 or other technically
accurate documented procedure.''.
(2) Section 327(f)(4)(B) of the Energy Policy and
Conservation Act (42 U.S.C. 6297(f)(4)(B)) is amended to read
as follows:
``(B) If a building code requires the installation of covered
products with efficiencies exceeding the levels and requirements
specified in paragraph (3)(B), such requirement of the building code
shall not be applicable unless the Secretary has granted a waiver for
such requirement under subsection (d) of this section.''.
SEC. 214. BEST-IN-CLASS APPLIANCES DEPLOYMENT PROGRAM.
(a) In General.--Not later than 1 year after the date of enactment
of this Act, the Secretary of Energy, in consultation with the
Administrator, shall establish a program to be known as the ``Best-in-
Class Appliances Deployment Program'' to--
(1) provide bonus payments to retailers or distributors
under subsection (c) for sales of best-in-class high-efficiency
household appliance models, high-efficiency installed building
equipment, and high-efficiency consumer electronics, with the
goal of reducing life-cycle costs for consumers, encouraging
innovation, and maximizing energy savings and public benefit;
(2) provide bounties under subsection (d) to retailers and
manufacturers for the replacement, retirement, and recycling of
old, inefficient, and environmentally harmful products; and
(3) provide premium awards under subsection (e) to
manufacturers for developing and producing new Superefficient
Best-in-Class Products.
(b) Designation of Best-in-Class Product Models.--
(1) In general.--The Secretary of Energy shall designate
product models of appliances, equipment, or electronics as
Best-in-Class Product models. The Secretary shall publicly
announce the Best-in-Class Product models designated under this
subsection. The Secretary shall define product classes broadly
and, except as provided in paragraph (2), shall designate as
Best-in-Class Product models no more than the most efficient 10
percent of the commercially available product models in a class
that demonstrate, as a group, a distinctly greater energy
efficiency than the average energy efficiency of that class of
appliances, equipment, or electronics. In designating models,
the Secretary shall--
(A) identify commercially available models in the
relevant class of products;
(B) identify the subgroup of those models that
share the distinctly higher energy-efficiency
characteristics that warrant designation as best-in-
class; and
(C) add other models in that class to the list of
Best-in-Class Product models as they demonstrate their
ability to meet the higher-efficiency characteristics
on which the designation was made.
(2) Percentage exception.--If there are fewer than 10
product models in a class of products, the Secretary may
designate one or more of such models as Best-in-Class Products.
(3) Review of best-in-class standards.--The Secretary shall
review annually the product-specific criteria for designating,
and the product models that qualify as, Best-in-Class Products
and, after notice and a 30-day comment period, make upwards
adjustments in the efficiency criteria as necessary to maintain
an appropriate ratio of such product models to the total number
of product models in the product class.
(4) Smart grid energy efficiency savings.--The Secretary
shall include energy efficiency savings achieved by a
commercially available product having smart grid capability in
determining the efficiency level of a product for purposes of a
Best-In-Class Product designation pursuant to this subsection.
In measuring energy efficiency savings achieved by smart grid
capability, the Secretary shall use a metric that--
(A) is based on the time-differentiated value and
amount of energy consumption;
(B) accounts for the capability of the product to
respond to a smart grid in which the physical
capability of the product to save or delay energy
because of a smart grid feature is weighted by the
likelihood that the feature will be used;
(C) is based on the value of a unit of electric or
gas consumption as a function of time of day and
season; and
(D) includes a test method by which the
manufacturer shall determine the energy efficiency of
smart grid capable products.
(c) Bonuses for Sales of Best-in-Class Products.--
(1) In general.--The Secretary of Energy shall make bonus
payments to retailers or, as provided in paragraph (5)(B),
distributors for the sale of Best-in-Class Products.
(2) Bonus program.--The Secretary shall--
(A) publicly announce the availability and amount
of the bonus to be paid for each sale of a Best-in-
Class Product of a model designated under subsection
(b); and
(B) make bonus payments in at least that amount for
each Best-in-Class Product of that model sold during
the 3-year period beginning on the date the model is
designated under subsection (b).
(3) Upgrade of best-in-class product eligibility.--In
conducting a review under subsection (b)(3), the Secretary
shall--
(A) consider designating as a Best-in-Class Product
model a Superefficient Best-in-Class Product model that
has been designated pursuant to subsection (e);
(B) announce any change in the bonus payment as
necessary to increase the market share of Best-in-Class
Product models;
(C) list models that will be eligible for bonuses
in the new amount; and
(D) continue paying bonus payments at the original
level, for the sale of any models that previously
qualified as Best-in-Class Products but do not qualify
at the new level, for the remainder of the 3-year
period announced with the original designation.
(4) Size of individual bonus payments.--(A) The size of
each bonus payment under this subsection shall be the product
of--
(i) an amount determined by the Secretary; and
(ii) the difference in energy consumption between
the Best-in-Class Product and the average product in
the product class.
(B) The Secretary shall determine the amount under
subparagraph (A)(i) for each product type, in consultation with
State and utility efficiency program administrators as well as
the Administrator, based on estimates of the amount of bonus
payment that would provide significant incentive to increase
the market share of Best-in-Class Products.
(5) Eligible bonus recipient.--(A) The Secretary shall
ensure that not more than 1 bonus payment is provided under
this subsection for each Best-in-Class Product.
(B) The Secretary may make distributors eligible to receive
bonus payments under this subsection for sales that are not to
the final end-user, to the extent that the Secretary determines
that for a particular product category distributors are well
situated to increase sales of Best-in-Class Products.
(d) Bounties for Replacement, Retirement, and Recycling of Existing
Low-Efficiency Products.--
(1) In general.--The Secretary of Energy shall make bounty
payments to--
(A) retailers for the replacement, retirement, and
recycling of older operating low-efficiency products
that might otherwise continue in operation; and
(B) manufacturers of Superefficient Best-in-Class
Products for the retirement and recycling of older
operating low-efficiency products that perform the same
function and which might otherwise continue in
operation.
(2) Bounties.--Bounties shall be payable--
(A) to a retailer upon documentation that the sale
of a Best-in-Class Product was accompanied by the
replacement, retirement, and recycling of--
(i) an inefficient but still-functioning
product; or
(ii) a nonfunctioning product containing a
refrigerant, by the consumer to whom the Best-
in-Class Product was sold; and
(B) to a manufacturer upon documentation of the
retirement and recycling of--
(i) an inefficient but still-functioning
product from a consumer to whom a
Superefficient Best-in-Class Product was
delivered; or
(ii) a nonfunctioning product containing a
refrigerant from a consumer to whom a
Superefficient Best-in-Class Product was
delivered.
(3) Amount.--
(A) Functioning products.--The bounty payment
payable under this subsection for a product described
in paragraphs (2)(A)(i) and (2)(B)(i) shall be based on
the difference between the estimated energy use of the
product replaced and the energy use of an average new
product in the product class, over the estimated
remaining lifetime of the product that was replaced.
(B) Nonfunctioning products containing
refrigerants.--The bounty payment payable under this
subsection for a product described in paragraphs
(2)(A)(ii) and (2)(B)(ii) shall be in the amount that
the Secretary of Energy, in consultation with the
Administrator, determines is sufficient to promote the
recycling of such products, up to the amount of bounty
for a comparable product described in paragraphs (2)(A)
and (2)(B).
(4) Retirement.--The Secretary shall ensure that no product
for which a bounty is paid under this subsection is returned to
active service, but that it is instead destroyed, and recycled
to the extent feasible.
(5) Recycling appliances containing refrigerants.--
Exclusively for the purpose of implementing the bounty payment
program for products containing a refrigerant under this
section, the Administrator shall establish standards for
environmentally responsible methods of recycling and disposal
of refrigerant-containing appliances that, at a minimum, meet
the requirements set by the Responsible Appliance Disposal
(RAD) Program for refrigerant disposal. The Secretary shall
ensure that such standards are met before a bounty payment is
made under this subsection for a product containing a
refrigerant. Nothing in this section shall be interpreted to
alter the requirements of section 608 of the Clean Air Act or
to relieve any person from complying with those requirements.
(e) Premium Awards for Development and Production of Superefficient
Best-in-Class Products.--
(1) In general.--(A) The Secretary of Energy shall provide
premium awards to manufacturers for the development and
production of Superefficient Best-in-Class Products. The
Secretary shall set and periodically revise standards for
eligibility of products for designation as a Superefficient
Best-in-Class Product.
(B) The Secretary may establish a standard for a
Superefficient Best-in-Class Product even if no product meeting
that standard exists, if the Secretary has reasonable grounds
to conclude that a mass-producible product could be made to
meet that standard.
(C) The Secretary may also establish a Superefficient Best-
in-Class Product standard that is met by one or more existing
Best-in-Class Product models, if those product models have
distinct energy efficiency attributes and performance
characteristics that make them significantly better than other
product models qualifying as best-in-class. The Secretary may
not designate as Superefficient Best-in-Class Products under
this subparagraph models that represent more than 10 percent of
the currently qualifying Best-in-Class Product models. This
subparagraph shall not apply to products designated pursuant to
paragraph (4)(A).
(D) In making its finding on the efficiency level a product
can achieve for purposes of a Superefficient Best-In-Class
Product designation pursuant to this paragraph, the Secretary
shall include energy efficiency savings that would be achieved
by a product as a result of smart grid capability when a
product having such capability can be produced and sold
commercially to mass market consumers. In measuring energy
efficiency savings achieved by smart grid capability, the
Secretary shall use a metric that--
(i) is based on the time-differentiated value and
amount of energy consumption;
(ii) accounts for the capability of the product to
respond to a smart grid in which the physical
capability of the product to save or delay energy
because of a smart grid feature is weighted by the
likelihood that the feature will be used;
(iii) is based on the value of a unit of electric
or gas consumption as a function of time of day and
season; and
(iv) includes a test method by which the
manufacturer shall determine the energy efficiency of
smart grid capable products.
(2) Premium awards.--(A) The premium award payment provided
to a manufacturer under this subsection shall be in addition to
any bonus payments made under subsection (c).
(B) The amount of the premium award paid per unit of
Superefficient Best-in-Class Products sold to retailers or
distributors shall, except as provided by subparagraph (F), be
the product of--
(i) an amount determined by the Secretary; and
(ii) the difference in energy consumption between
the Superefficient Best-in-Class Product and the
average product in the product class.
(C) The Secretary shall determine the amount under
subparagraph (B)(i) for each product type, in consultation with
State and utility efficiency program administrators as well as
the Administrator, based on consideration of the present value
to the Nation of the energy (and water or other resources or
inputs) saved over the useful life of the product. The
Secretary may also take into consideration the methods used to
increase sales of qualifying products in determining such
amount.
(D) The Secretary may adjust the value described in
subparagraph (C) upward or downward as appropriate, including
based on the effect of the premium awards on the sales of
products in different classes that may be affected by the
program under this subsection.
(E) Premium award payments shall be applied to sales of any
Superefficient Best-in-Class Product for the first 3 years
after designation as a Superefficient Best-in-Class Product.
(F) For years 2011 through 2013, the Secretary shall make
bonus payments to manufacturers of the products designated in
paragraph (4)(A) for each product produced in the following
amounts:
(i) $75 for each dishwasher.
(ii) $250 for each clothes washer.
(iii) $200 for each refrigerator or refrigerator-
freezer.
(iv) $250 for each clothes dryer.
(v) $200 for each cooking product.
(vi) $300 for each water heater.
(3) Coordination of incentives.--No product for which
Federal tax credit is received under section 45M of the
Internal Revenue Code of 1986 shall be eligible to receive
premium award payments pursuant to this subsection.
(4) Designations.--
(A) Initial designations.--Notwithstanding any
other provisions of this section, the products the
Secretary shall designate as a Superefficient Best-In-
Class Product include, but are not limited to, the
following products manufactured in 2011 through 2013:
(i) A dishwasher, clothes washer,
refrigerator, or refrigerator-freezer that
meets the highest efficiency performance
standards in its product category as provided
in Section 305(b) of the Emergency Economic
Stabilization Act of 2008 and has the smart
grid capability specified in paragraph (5).
(ii) A water heater that meets an
efficiency standard that is the same or
equivalent to the standard provided in Section
1333 of the Energy Policy Act of 2005 and has
the smart grid capability specified in
paragraph (5).
(iii) A clothes dryer or cooking product
that the Secretary determines meets the
standards specified in subsection (j)(3), which
the Secretary shall promulgate no later than 1
year after the date of enactment, and has the
smart grid capability specified in paragraph
(5).
(B) Extension of initial designations.--
(i) General.--The Secretary shall in 2013
extend the Superefficient Best-In-Class Product
designation of each product specified in
subparagraph (A)(i) through (iii) through 2017,
provided that for each product designation
extended--
(I) the extension will result in
significant energy efficiency savings;
(II) the product meets the
Superefficient Best-In-Class Product
criteria specified in paragraph (1);
(III) the eligibility standards of
the product include the smart grid
capability specified in paragraph (5);
and
(IV) the Secretary makes
appropriate revisions to the
eligibility standards of the product as
provided by paragraph (1).
(ii) Awards.--If a Superefficient Best-In-
Class Product designation for a product is
extended pursuant to this subparagraph, the
premium award for the product shall be
determined in accordance with paragraph (2).
(5) Smart grid capability.--
(A) Until the Secretary promulgates criteria under
subparagraph (B), the term ``smart grid capability''
means capability of receiving and interpreting time-of-
use pricing and peak-load-shed signals from a utility
and--
(i) in the case of a cooking product,
reducing a minimum of 20 percent during peak
demand as measured by the tested average
wattage over the course of a typical operating
cycle of the product; or
(ii) in the case of a clothes washer, a
refrigerator, a dishwasher, a dryer and a water
heater, reducing a minimum of 50 percent during
peak demand as measured by the tested average
wattage over the course of a typical operating
cycle of the product, provided that the typical
operating cycle of a refrigerator and a water
heater shall be a 24-hour period.
(B) After completion of the analysis required under
section 142(b) of this Act, the Secretary shall
expeditiously promulgate, after notice and a 30-day
public comment period, criteria for what constitutes
``smart grid capability.''
(f) Reporting.--The Secretary of Energy shall require, as a
condition of receiving a bonus, bounty, or premium award under this
section, that a report containing the following documentation be
provided:
(1) For retailers and distributors, the number of units
sold within each product type, and model-specific wholesale
purchase prices and retail sale prices, on a monthly basis.
(2) For manufacturers, model-specific energy efficiency and
consumption data.
(3) For manufacturers, on an immediate basis, information
concerning any product design or function changes that affect
the energy consumption of the unit.
(4) The methods used to increase the sales of qualifying
products.
(g) Monitoring and Verification Protocols.--The Secretary of Energy
shall establish monitoring and verification protocols for energy
consumption tests for each product model and for sales of energy-
efficient models. The Secretary shall estimate actual savings of energy
from the use of Smart Grid capability in appliances for which premium
award payments are made pursuant to subsection (e) as a function of
utility and consumer readiness to utilize such capability.
(h) Disclosure.--The Secretary of Energy may require that
manufacturers, retailers and distributors disclose publicly and to
consumers their participation in the program under this section.
(i) Cost-Effectiveness Requirement.--
(1) Requirement.--The Secretary of Energy shall make cost-
effectiveness a top priority in designing the program under,
and administering, this section, except that the cost-
effectiveness of providing premium awards to manufacturers
under subsection (e), in aggregate, may be lower by this
measure than that of the bonuses and bounties to retailers and
distributors under subsections (c) and (d).
(2) Definitions.--In this subsection:
(A) Cost-effectiveness.--The term ``cost-
effectiveness'' means a measure of aggregate savings in
the cost of energy over the lifetime of a product in
relation to the cost to the Secretary of the bonuses,
bounties, and premium awards provided under this
section for a product.
(B) Savings.--The term ``savings'' means the
cumulative megawatt-hours of electricity or million
British thermal units of other fuels saved by a product
during the projected useful life of the product, in
comparison to projected energy consumption of the
average product in the same class, taking into
consideration the impact of any documented measures to
replace, retire, and recycle low-efficiency products at
the time of purchase of highly-efficient substitutes.
(j) Definitions.--In this section--
(1) the term ``distributor'' mean an individual,
organization, or company that sells products in multiple lots
and not directly to end-users;
(2) the term ``retailer'' means an individual,
organization, or company that sells products directly to end-
users;
(3) the term ``manufacturer'' means an individual,
organization, or company that transforms raw materials into
mass-producible finished goods; and
(4) the term ``Superefficient Best-in-Class Product'' means
a product that--
(A) can be mass produced; and
(B) achieves the highest level of efficiency that
the Secretary of Energy finds can, given the current
state of technology, be produced and sold commercially
to mass-market consumers.
(k) Authorization of Appropriations.--There are authorized to be
appropriated $600,000,000 for each of the fiscal years 2011 through
2013 to the Secretary of Energy for purposes of this section, and such
sums as may be necessary for subsequent fiscal years. Of funds
appropriated, not more than 10 percent for any fiscal year may be
expended on program administration, and not less than 40 percent of any
funds appropriated during fiscal years 2011 through 2013 shall be for
purposes of subsection (e).
SEC. 215. WATERSENSE.
(a) In General.--There is established within the Environmental
Protection Agency a WaterSense program to identify and promote water
efficient products, buildings and landscapes, and services in order--
(1) to reduce water use;
(2) to reduce the strain on water, wastewater, and
stormwater infrastructure;
(3) to conserve energy used to pump, heat, transport, and
treat water; and
(4) to preserve water resources for future generations,
through voluntary labeling of, or other forms of communications about,
products, buildings and landscapes, and services that meet the highest
water efficiency and performance standards.
(b) Duties.--The Administrator shall--
(1) promote WaterSense labeled products, buildings and
landscapes, and services in the market place as the preferred
technologies and services for--
(A) reducing water use; and
(B) ensuring product and service performance;
(2) work to enhance public awareness of the WaterSense
label through public outreach, education, and other means;
(3) establish and maintain performance standards so that
products, buildings and landscapes, and services labeled with
the WaterSense label perform as well or better than their less
efficient counterparts;
(4) publicize the need for proper installation and
maintenance of WaterSense products by a licensed, and where
certification guidelines exist, WaterSense-certified
professional to ensure optimal performance;
(5) preserve the integrity of the WaterSense label;
(6) regularly review and, when appropriate, update
WaterSense criteria for categories of products, buildings and
landscapes, and services, at least once every 4 years;
(7) to the extent practical, regularly estimate and make
available to the public the production and relative market
shares of WaterSense labeled products, buildings and
landscapes, and services, at least annually;
(8) to the extent practical, regularly estimate and make
available to the public the water and energy savings
attributable to the use of WaterSense labeled products,
buildings and landscapes, and services, at least annually;
(9) solicit comments from interested parties and the public
prior to establishing or revising a WaterSense category,
specification, installation criterion, or other criterion (or
prior to effective dates for any such category, specification,
installation criterion, or other criterion);
(10) provide reasonable notice to interested parties and
the public of any changes (including effective dates), on the
adoption of a new or revised category, specification,
installation criterion, or other criterion, along with--
(A) an explanation of changes; and
(B) as appropriate, responses to comments submitted
by interested parties;
(11) provide appropriate lead time (as determined by the
Administrator) prior to the applicable effective date for a new
or significant revision to a category, specification,
installation criterion, or other criterion, taking into account
the timing requirements of the manufacturing, marketing,
training, and distribution process for the specific product,
building and landscape, or service category addressed; and
(12) identify and, where appropriate, implement other
voluntary approaches in commercial, institutional, residential,
municipal, and industrial sectors to encourage reuse and
recycling technologies, improve water efficiency, or lower
water use while meeting, where applicable, the performance
standards established under paragraph (3).
(c) Authorization of Appropriations.--There are authorized to be
appropriated $7,500,000 for fiscal year 2010, $10,000,000 for fiscal
year 2011, $20,000,000 for fiscal year 2012, and $50,000,000 for fiscal
year 2013 and each year thereafter, adjusted for inflation, to carry
out this section.
SEC. 216. FEDERAL PROCUREMENT OF WATER EFFICIENT PRODUCTS.
(a) Definitions.--In this section:
(1) Agency.--The term ``agency'' has the meaning given that
term in section 7902(a) of title 5, United States Code.
(2) Watersense product or service.--The term ``WaterSense
product or service'' means a product or service that is rated
for water efficiency under the WaterSense program.
(3) Watersense program.--The term ``WaterSense program''
means the program established by section 215 of this Act.
(4) FEMP designated product.--The term ``FEMP designated
product'' means a product that is designated under the Federal
Energy Management Program of the Department of Energy as being
among the highest 25 percent of equivalent products for
efficiency.
(5) Product and service.--The terms ``product'' and
``service'' do not include any water consuming product or
service designed or procured for combat or combat-related
missions. The terms also exclude products or services already
covered by the Federal procurement regulations established
under section 553 of the National Energy Conservation Policy
Act (42 U.S.C. 8259b).
(b) Procurement of Water Efficient Products.--
(1) Requirement.--To meet the requirements of an agency for
a water consuming product or service, the head of the agency
shall, except as provided in paragraph (2), procure--
(A) a WaterSense product or service; or
(B) a FEMP designated product.
A WaterSense plumbing product should preferably, when possible,
be installed by a licensed and, when WaterSense certification
guidelines exist, WaterSense-certified plumber or mechanical
contractor, and a WaterSense irrigation system should
preferably, when possible, be installed, maintained, and
audited by a WaterSense-certified irrigation professional to
ensure optimal performance.
(2) Exceptions.--The head of an agency is not required to
procure a WaterSense product or service or FEMP designated
product under paragraph (1) if the head of the agency finds in
writing that--
(A) a WaterSense product or service or FEMP
designated product is not cost-effective over the life
of the product, taking energy and water cost savings
into account; or
(B) no WaterSense product or service or FEMP
designated product is reasonably available that meets
the functional requirements of the agency.
(3) Procurement planning.--The head of an agency shall
incorporate into the specifications for all procurements
involving water consuming products and systems, including guide
specifications, project specifications, and construction,
renovation, and services contracts that include provision of
water consuming products and systems, and into the factors for
the evaluation of offers received for the procurement, criteria
used for rating WaterSense products and services and FEMP
designated products. The head of an agency shall consider, to
the maximum extent practicable, additional measures for
reducing agency water consumption, including water reuse
technologies, leak detection and repair, and use of waterless
products that perform similar functions to existing water-
consuming products.
(c) Regulations.--Not later than 180 days after the date of
enactment of this Act, the Secretary of Energy, working in coordination
with the Administrator, shall issue guidelines to carry out this
section.
SEC. 217. EARLY ADOPTER WATER EFFICIENT PRODUCT INCENTIVE PROGRAMS.
(a) Definitions.--In this section:
(1) Eligible entity.--The term ``eligible entity'' means a
State government, local or county government, tribal
government, wastewater or sewerage utility, municipal water
authority, energy utility, water utility, or nonprofit
organization that meets the requirements of subsection (b).
(2) Incentive program.--The term ``incentive program''
means a program for administering financial incentives for
consumer purchase and installation of residential water
efficient products and services as described in subsection
(b)(1).
(3) Residential water efficient product or service.--The
term ``residential water efficient product or service'' means a
product or service for a single-family or multifamily residence
or its landscape that is rated for water efficiency and
performance--
(A) by the WaterSense program; or
(B) where a WaterSense specification does not
exist, by an incentive program.
Categories of water efficient products and services may include
faucets, irrigation technologies and services, point-of-use
water treatment devices, reuse and recycling technologies,
toilets, and showerheads.
(4) Watersense program.--The term ``WaterSense program''
means the program established by section 215 of this Act.
(b) Eligible Entities.--An entity shall be eligible to receive an
allocation under subsection (c) if the entity--
(1) establishes (or has established) an incentive program
to provide rebates, vouchers, other financial incentives, or
direct installs to consumers for the purchase of residential
water efficient products or services;
(2) submits an application for the allocation at such time,
in such form, and containing such information as the
Administrator may require; and
(3) provides assurances satisfactory to the Administrator
that the entity will use the allocation to supplement, but not
supplant, funds made available to carry out the incentive
program.
(c) Amount of Allocations.--For each fiscal year, the Administrator
shall determine the amount to allocate to each eligible entity to carry
out subsection (d) taking into consideration--
(1) the population served by the eligible entity in the
most recent calendar year for which data are available;
(2) the targeted population of the eligible entity's
incentive program, such as general households, low-income
households, or first-time homeowners, and the probable
effectiveness of the incentive program for that population;
(3) for existing programs, the effectiveness of the
incentive program in encouraging the adoption of water
efficient products and services; and
(4) any prior year's allocation to the eligible entity that
remains unused.
(d) Use of Allocated Funds.--Funds allocated to an entity under
subsection (c) may be used to pay up to 50 percent of the cost of
establishing and carrying out an incentive program.
(e) Fixture Recycling.--Entities are encouraged to promote or
implement fixture recycling programs to manage the disposal of older
fixtures replaced due to the incentive program under this section.
(f) Issuance of Incentives.--Financial incentives may be provided
to consumers that meet the requirements of the incentive program. The
entity may issue all financial incentives directly to consumers or,
with approval of the Administrator, delegate some or all financial
incentives administration to other organizations including, but not
limited to, local governments, municipal water authorities, and water
utilities. The amount of a financial incentives shall be determined by
the entity, taking into consideration--
(1) the amount of the allocation to the entity under
subsection (c);
(2) the amount of any Federal, State, or other
organization's tax or financial incentive available for the
purchase of the residential water efficient product or service;
(3) the amount necessary to change consumer behavior to
purchase water efficient products and services; and
(4) the consumer expenditures for onsite preparation,
assembly, and original installation of the product.
(g) Authorization of Appropriations.--There are authorized to be
appropriated to the Administrator to carry out this section $50,000,000
for fiscal year 2010, $100,000,000 for fiscal year 2011, $150,000,000
for fiscal year 2012, $100,000,000 for fiscal year 2013, and
$50,000,000 for fiscal year 2014.
SEC. 218. CERTIFIED STOVES PROGRAM.
(a) Definitions.--In this section:
(1) Agency.--The term ``Agency'' means the Environmental
Protection Agency.
(2) Wood stove or pellet stove.--The term ``wood stove or
pellet stove'' means a wood stove, pellet stove, or fireplace
insert that uses wood or pellets for fuel.
(3) Certified stove.--The term ``certified stove'' means a
wood stove or pellet stove that meets the standards of
performance for new residential wood heaters under subpart AAA
of part 60 of subchapter C of chapter I of title 40, Code of
Federal Regulations (or successor regulations), as certified by
the Administrator. Pellet stoves and fireplace inserts using
pellets for fuel that are exempt from testing by the
Administrator but meet the same standards of performance as
wood stoves are considered certified for the purposes of this
section.
(4) Eligible entity.--The term ``eligible entity'' means--
(A) a State, a local government, or a federally
recognized Indian tribe;
(B) Alaskan Native villages or regional or village
corporations (as defined in, or established under, the
Alaskan Native Claims Settlement Act (43 U.S.C. 1601 et
seq.)); and
(C) a nonprofit organization or institution that--
(i) represents or provides pollution
reduction or educational services relating to
wood smoke minimization to persons,
organizations, or communities; or
(ii) has, as its principal purpose, the
promotion of air quality or energy efficiency.
(b) Establishment.--The Administrator shall establish and carry out
a program to assist in the replacement of wood stoves or pellet stoves
that do not meet the standards of performance referred to in subsection
(a)(4) by--
(1) requiring that each wood stove or pellet stove sold in
the United States on and after the date of enactment of this
Act meet the standards of performance referred to in subsection
(a)(4);
(2) requiring that no wood stove or pellet stove replaced
under this program is sold or returned to active service, but
that it is instead destroyed and recycled to the maximum extent
feasible;
(3) providing funds to an eligible entity to replace a wood
stove or pellet stove that does not meet the standards of
performance in subsection (a)(4) with a certified stove,
including funds to pay for--
(A) installation of a replacement certified stove;
and
(B) necessary replacement of or repairs to
ventilation, flues, chimneys, or other relevant items
necessary for safe installation of a replacement
certified stove;
(4) in addition to any funds that may be appropriated for
the program under this subsection, using existing Federal,
State, and local programs and incentives, to the greatest
extent practicable;
(5) prioritizing the replacement of wood stoves or pellet
stoves manufactured before July 1, 1990; and
(6) carrying out such other activities as the Administrator
determines appropriate to facilitate the replacement of wood
stoves or pellet stoves that do not meet the standards of
performance referred to in subsection (a)(3).
(c) Regulations.--The Administrator may promulgate such regulations
as are necessary to carry out the program established under subsection
(b).
(d) Funding.--
(1) Authorization of appropriations.--There are authorized
to be appropriated to carry out the program under this section
$20,000,000 for the period of fiscal years 2010 through 2014.
(2) Designated use.--Of amounts appropriated pursuant to
this subsection--
(A) 25 percent shall be designated for use to carry
out the program under this section on lands held in
trust for the benefit of a federally recognized Indian
tribe;
(B) 3 percent shall be designated for use to carry
out the program under this section in Alaskan Native
villages or regional or village corporations (as
defined in, or established under, the Alaskan Native
Claims Settlement Act (43 U.S.C. 1601 et seq.)); and
(C) 72 percent shall be designated for use to carry
out the program under this section nationwide.
(3) Regulatory programs.--
(A) In general.--No grant or loan provided under
this section shall be used to fund the costs of
emissions reductions that are mandated under Federal,
State, or local law.
(B) Mandated.--For purposes of subparagraph (A),
voluntary or elective emission reduction measures shall
not be considered ``mandated'', regardless of whether
the reductions are included in the implementation plan
of a State.
(e) EPA Authority to Accept Wood Stove or Pellet Stove Replacement
Supplemental Environmental Projects.--
(1) In general.--The Administrator may accept
(notwithstanding sections 3302 and 1301 of title 31, United
States Code) wood stove or pellet stove replacement
Supplemental Environmental Projects if such projects, as part
of a settlement of any alleged violation of environmental law--
(A) protect human health or the environment;
(B) are related to the underlying alleged
violation;
(C) do not constitute activities that the defendant
would otherwise be legally required to perform; and
(D) do not provide funds for the staff of the
Agency or for contractors to carry out the Agency's
internal operations.
(2) Certification.--In any settlement agreement regarding
an alleged violation of environmental law in which a defendant
agrees to perform a wood stove or pellet stove replacement
Supplemental Environmental Project, the Administrator shall
require the defendant to include in the settlement documents a
certification under penalty of law that the defendant would
have agreed to perform a comparably valued, alternative project
other than a wood stove or pellet stove replacement
Supplemental Environmental Project if the Administrator were
precluded by law from accepting a wood stove or pellet stove
replacement Supplemental Environmental Project. A failure by
the Administrator to include this language in such a settlement
agreement shall not create a cause of action against the United
States under the Clean Air Act or any other law or create a
basis for overturning a settlement agreement entered into by
the United States.
SEC. 219. ENERGY STAR STANDARDS.
(a) Energy Star.--Section 324A(c) of the Energy Policy and
Conservation Act is amended--
(1) in paragraph (6)(B), by striking ``and'' after the
semicolon at the end;
(2) in paragraph (7), by striking the period at the end and
inserting a semicolon; and
(3) by adding at the end the following:
``(8) not later than 18 months after the date of enactment
of this paragraph, establish and implement a rating system for
products identified as Energy Star products pursuant to this
section to provide consumers with the most helpful information
on the relative energy efficiency, including cost effectiveness
from the consumer's perspective, and relative length of time
for consumers to recover costs attributable to the energy
efficient features, of those products, unless the Administrator
and the Secretary communicate to Congress that establishing
such a system would diminish the value of the Energy Star brand
to consumers;
``(9)(A) review the Energy Star product criteria for the 10
product models in each product category with the greatest
energy consumption at least once every 3 years; and
``(B) based on the review, update and publish the Energy
Star product criteria for each such category, as necessary; and
``(10) require periodic verification of compliance with the
Energy Star product criteria by products identified as Energy
Star products pursuant to this section, including--
``(A) purchase and testing of products from the
market; or
``(B) other appropriate testing and compliance
approaches.''.
(b) Authorization of Appropriations.--There are authorized to be
appropriated to carry out the amendments made by this section
$5,000,000 for fiscal year 2010 and for each fiscal year thereafter.
Subtitle C--Transportation Efficiency
SEC. 221. EMISSIONS STANDARDS.
Title VIII of the Clean Air Act, as added by section 331 of this
Act, is amended by inserting after part A the following new part:
``PART B--MOBILE SOURCES
``SEC. 821. GREENHOUSE GAS EMISSION STANDARDS FOR MOBILE SOURCES.
``(a) New Motor Vehicles and New Motor Vehicle Engines.--(1)
Pursuant to section 202(a)(1), by December 31, 2010, the Administrator
shall promulgate standards applicable to emissions of greenhouse gases
from new heavy-duty motor vehicles or new heavy-duty motor vehicle
engines, excluding such motor vehicles covered by the Tier II standards
(as established by the Administrator as of the date of the enactment of
this section). The Administrator may revise these standards from time
to time.
``(2) Regulations issued under section 202(a)(1) applicable to
emissions of greenhouse gases from new heavy-duty motor vehicles or new
heavy-duty motor vehicle engines, excluding such motor vehicles covered
by the Tier II standards (as established by the Administrator as of the
date of the enactment of this section), shall contain standards that
reflect the greatest degree of emissions reduction achievable through
the application of technology which the Administrator determines will
be available for the model year to which such standards apply, giving
appropriate consideration to cost, energy, and safety factors
associated with the application of such technology. Any such
regulations shall take effect after such period as the Administrator
finds necessary to permit the development and application of the
requisite technology, and, at a minimum, shall apply for a period no
less than 3 model years beginning no earlier than the model year
commencing 4 years after such regulations are promulgated.
``(3) Regulations issued under section 202(a)(1) applicable to
emissions of greenhouse gases from new heavy-duty motor vehicles or new
heavy-duty motor vehicle engines, excluding such motor vehicles covered
by the Tier II standards (as established by the Administrator as of the
date of the enactment of this section), shall supersede and satisfy any
and all of the rulemaking and compliance requirements of section
32902(k) of title 49, United States Code.
``(4) Other than as specifically set forth in paragraph (3) of this
subsection, nothing in this section shall affect or otherwise increase
or diminish the authority of the Secretary of Transportation to adopt
regulations to improve the overall fuel efficiency of the commercial
goods movement system.
``(b) Nonroad Vehicles and Engines.--(1) Pursuant to section
213(a)(4) and (5), the Administrator shall identify those classes or
categories of new nonroad vehicles or engines, or combinations of such
classes or categories, that, in the judgment of the Administrator, both
contribute significantly to the total emissions of greenhouse gases
from nonroad engines and vehicles, and provide the greatest potential
for significant and cost-effective reductions in emissions of
greenhouse gases. The Administrator shall promulgate standards
applicable to emissions of greenhouse gases from these new nonroad
engines or vehicles by December 31, 2012. The Administrator shall also
promulgate standards applicable to emissions of greenhouse gases for
such other classes and categories of new nonroad vehicles and engines
as the Administrator determines appropriate and in the timeframe the
Administrator determines appropriate. The Administrator shall base such
determination, among other factors, on the relative contribution of
greenhouse gas emissions, and the costs for achieving reductions, from
such classes or categories of new nonroad engines and vehicles. The
Administrator may revise these standards from time to time.
``(2) Standards under section 213(a)(4) and (5) applicable to
emissions of greenhouse gases from those classes or categories of new
nonroad engines or vehicles identified in the first sentence of
paragraph (1) of this subsection, shall achieve the greatest degree of
emissions reduction achievable based on the application of technology
which the Administrator determines will be available at the time such
standards take effect, taking into consideration cost, energy, and
safety factors associated with the application of such technology. Any
such regulations shall take effect at the earliest possible date after
such period as the Administrator finds necessary to permit the
development and application of the requisite technology, giving
appropriate consideration to the cost of compliance within such period,
the applicable compliance dates for other standards, and other
appropriate factors, including the period of time appropriate for the
transfer of applicable technology from other applications, including
motor vehicles, and the period of time in which previously promulgated
regulations have been in effect.
``(3) For purposes of this section and standards under section
213(a)(4) or (5) applicable to emissions of greenhouse gases, the term
`nonroad engines and vehicles' shall include non-internal combustion
engines and the vehicles these engines power (such as electric engines
and electric vehicles), for those non-internal combustion engines and
vehicles which would be in the same category and have the same uses as
nonroad engines and vehicles that are powered by internal combustion
engines.
``(c) Averaging, Banking, and Trading of Emissions Credits.--In
establishing standards applicable to emissions of greenhouse gases
pursuant to this section and sections 202(a), 213(a)(4) and (5), and
231(a), the Administrator may establish provisions for averaging,
banking, and trading of greenhouse gas emissions credits within or
across classes or categories of motor vehicles and motor vehicle
engines, nonroad vehicles and engines (including marine vessels), and
aircraft and aircraft engines, to the extent the Administrator
determines appropriate and considering the factors appropriate in
setting standards under those sections. Such provisions may include
reasonable and appropriate provisions concerning generation, banking,
trading, duration, and use of credits.
``(d) Reports.--The Administrator shall, from time to time, submit
a report to Congress that projects the amount of greenhouse gas
emissions from the transportation sector, including transportation
fuels, for the years 2030 and 2050, based on the standards adopted
under this section.
``(e) Greenhouse Gases.--Notwithstanding the provisions of section
711, hydrofluorocarbons shall be considered a greenhouse gas for
purposes of this section.''.
SEC. 222. GREENHOUSE GAS EMISSIONS REDUCTIONS THROUGH TRANSPORTATION
EFFICIENCY.
(a) Environmental Protection Agency.--Title VIII of the Clean Air
Act, as added by section 331 of this Act, is further amended by
inserting after part C the following new part:
``PART D--TRANSPORTATION EMISSIONS
``SEC. 841. GREENHOUSE GAS EMISSIONS REDUCTIONS THROUGH TRANSPORTATION
EFFICIENCY.
``(a) In General.--The Administrator, in consultation with the
Secretary of Transportation, shall promulgate, and update from time to
time, regulations to establish national transportation-related
greenhouse gas emissions reduction goals, standardized models and
methodologies for use in developing surface transportation-related
greenhouse gas emissions reduction targets pursuant to sections 134 and
135 of title 23 of the United States Code and methods for collection of
data on transportation-related greenhouse gas emissions. Such goals
shall be commensurate with the emissions reductions goals established
under the American Clean Energy and Security Act of 2009. In
establishing such goals, models, and methodologies, the Administrator
shall consult with States and metropolitan planning organizations and
may utilize existing models and methodologies.
``(b) Timing.--The Administrator shall--
``(1) publish proposed regulations under subsection (a) not
later than 12 months after the date of enactment of this
section; and
``(2) promulgate final regulations under subsection (a) not
later than 18 months after the date of enactment of this
section.
``(c) Assessment.--At least every 6 years after promulgating final
regulations under subsection (a), the Administrator, jointly with the
Secretary of Transportation, shall assess current and projected
progress in reducing national transportation-related greenhouse gas
emissions. The assessment shall examine the contributions to emissions
reductions attributable to improvements in vehicle efficiency,
greenhouse gas performance of transportation fuels, increased
efficiency in utilizing transportation systems and the effects of local
and State planning.''.
(b) Metropolitan Planning Organizations.--Section 134 of title 23
of the United States Code is amended as follows:
(1) In subsection (a)(1)--
(A) by striking ``minimizing'' and inserting
``reducing''; and
(B) by inserting ``, reliance on oil, impacts on
the environment, transportation-related greenhouse gas
emissions'' after ``consumption''.
(2) In subsection (h)(1)(E)--
(A) by inserting ``sustainability and livability,
reduce surface transportation-related greenhouse gas
emissions and reliance on oil, adapt to the effects of
climate change,'' after ``energy conservation'';
(B) by inserting ``and public health'' after
``quality of life''; and
(C) by inserting ``, including housing and land use
patterns'' after ``development patterns''.
(3) In subsection (i)(4)(A) by inserting ``air quality,
public health, housing, transportation,'' after
``conservation,''.
(4) In subsection (k) by inserting at the end the following
new paragraph:
``(6) Emissions reduction process.--
``(A) In general.--Within a metropolitan planning
area serving a transportation management area, the
transportation planning process under this section
shall address transportation-related greenhouse gas
emissions by including emission reduction targets and
strategies.
``(B) Establishment of emissions reduction targets
and strategies.--
``(i) In general.--Not later than 1 year
after the promulgation of the final regulations
required under section 841 of the Clean Air
Act, each metropolitan planning organization
shall develop surface transportation-related
greenhouse gas emission reduction targets, as
well as strategies to meet such targets, as
part of the transportation planning process
under this section. If more than one
metropolitan planning organization has been
designated within a metropolitan planning area
serving a transportation management area, each
such metropolitan planning organization shall
work cooperatively with other such organization
to develop the surface transportation-related
greenhouse gas emission reduction targets
required under this subparagraph.
``(ii) Minimum requirements.--Each
metropolitan planning organization that
develops targets and strategies required under
clause (i) shall demonstrate progress in
stabilizing and reducing transportation-related
greenhouse gas emissions in each metropolitan
planning area serving a surface transportation
management area. The targets and strategies
shall, at a minimum--
``(I) be based on the models and
methodologies established in the final
regulations required under section 841
of the Clean Air Act;
``(II) address sources of surface
transportation-related greenhouse gas
emissions and contribute to achievement
of the national transportation-related
greenhouse gas emissions reduction
goals;
``(III) include efforts to increase
public transportation ridership; and
``(IV) include efforts to increase
walking, bicycling, and other forms of
nonmotorized transportation.
``(C) Public notice.--Each metropolitan planning
organization shall make its emission reduction targets
and strategies, and an analysis of the anticipated
effects thereof, available to the public through its
Web site.
``(D) Enforcement.--If the Secretary finds that a
metropolitan planning organization has failed to
develop, submit or publish its emission reduction
targets and strategies, the Secretary shall not certify
that the requirements of this section are met with
respect to the metropolitan planning process of such
organization.''.
(c) States.--Section 135 of title 23 of the United States Code is
amended as follows:
(1) In subsection (d)(1)(E)--
(A) by inserting ``sustainability and livability,
reduce surface transportation-related greenhouse gas
emissions and reliance on oil, adapt to the effects of
climate change,'' after ``energy conservation'';
(B) by inserting ``and public health'' after
``quality of life''; and
(C) by inserting ``, including housing and land use
patterns'' after ``development patterns''.
(2) In subsection (f)(2)(D)(i) by inserting ``air quality,
public health, housing, transportation,'' after
``conservation,''.
(3) In subsection (f) by inserting at the end the following
new paragraph:
``(9) Emissions reduction process.--
``(A) In general.--Within a State, the
transportation planning process under this section
shall address transportation-related greenhouse gas
emissions by including emission reduction targets and
strategies.
``(B) Establishment of emissions reduction targets
and strategies.--
``(i) In general.--Not later than 1 year
after the promulgation of the final regulations
required under section 841 of the Clean Air
Act, each State shall develop surface
transportation-related greenhouse gas emission
reduction targets, as well as strategies to
meet such targets, as part of the
transportation planning process under this
section.
``(ii) Minimum requirements.--Each State
that develops targets and strategies required
under clause (i) shall demonstrate progress in
stabilizing and reducing transportation-related
greenhouse gas emissions in such State. The
targets and strategies shall, at a minimum--
``(I) be based on the models and
methodologies established in the final
regulations required under section 841
of the Clean Air Act;
``(II) address sources of surface
transportation-related greenhouse gas
emissions and contribute to achievement
of the national transportation-related
greenhouse gas emissions reduction
goals;
``(III) include efforts to increase
public transportation ridership; and
``(IV) include efforts to increase
walking, bicycling, and other forms of
nonmotorized transportation.
``(D) Public notice.--Each State shall make its
emission reduction targets and strategies, and an
analysis of the anticipated effects thereof, available
to the public through its Web site.
``(E) Enforcement.--If the Secretary finds that a
State has failed to develop, submit or publish its
emission reduction targets and strategies, the
Secretary shall not certify that the requirements of
this section are met with respect to the statewide
planning process of such State.''.
(d) Department of Transportation.--The Secretary of Transportation
shall establish appropriate requirements, including performance
measures, to ensure that transportation plans developed under sections
134 and 135 of title 23 of the United States Code sufficiently meet the
requirements of this section, including achieving progress towards
national transportation-related greenhouse gas emissions reduction
goals.
SEC. 223. SMARTWAY TRANSPORTATION EFFICIENCY PROGRAM.
Part B of title VIII of the Clean Air Act, as added by section 221
of this Act is amended by adding after section 821 the following
section:
``SEC. 822. SMARTWAY TRANSPORTATION EFFICIENCY PROGRAM.
``(a) In General.--There is established within the Environmental
Protection Agency a SmartWay Transport Program to quantify,
demonstrate, and promote the benefits of technologies, products, fuels,
and operational strategies that reduce petroleum consumption, air
pollution, and greenhouse gas emissions from the mobile source sector.
``(b) General Duties.--Under the program established under this
section, the Administrator shall carry out each of the following:
``(1) Development of measurement protocols to evaluate the
energy consumption and greenhouse gas impacts from technologies
and strategies in the mobile source sector, including those for
passenger transport and goods movement.
``(2) Development of qualifying thresholds for certifying,
verifying, or designating energy-efficient, low-greenhouse gas
SmartWay technologies and strategies for each mode of passenger
transportation and goods movement.
``(3) Development of partnership and recognition programs
to promote best practices and drive demand for energy-
efficient, low-greenhouse gas transportation performance.
``(4) Promotion of the availability of, and encouragement
of the adoption of, SmartWay certified or verified technologies
and strategies, and publication of the availability of
financial incentives, such as assistance from loan programs and
other Federal and State incentives.
``(c) Smartway Transport Freight Partnership.--The Administrator
shall establish a SmartWay Transport Freight Partnership program with
shippers and carriers of goods to promote energy-efficient, low-
greenhouse gas transportation. In carrying out such partnership, the
Administrator shall undertake each of the following:
``(1) Certification of the energy and greenhouse gas
performance of participating freight carriers, including those
operating rail, trucking, marine, and other goods movement
operations.
``(2) Publication of a comprehensive energy and greenhouse
gas performance index of freight modes (including rail,
trucking, marine, and other modes of transporting goods) and
individual freight companies so that shippers can choose to
deliver their goods more efficiently.
``(3) Development of tools for--
``(A) carriers to calculate their energy and
greenhouse gas performance; and
``(B) shippers to calculate the energy and
greenhouse gas impacts of moving their products and to
evaluate the relative impacts from transporting their
goods by different modes and corporate carriers.
``(4) Provision of recognition opportunities for
participating shipper and carrier companies demonstrating
advanced practices and achieving superior levels of greenhouse
gas performance.
``(d) Improving Freight Greenhouse Gas Performance Databases.--The
Administrator shall, in coordination with other appropriate agencies,
define and collect data on the physical and operational characteristics
of the Nation's truck population, with special emphasis on data related
to energy efficiency and greenhouse gas performance to inform the
performance index published under subsection (c)(2) of this section,
and other means of goods transport as necessary, at least every 5
years.
``(e) Establishment of Financing Program.--The Administrator shall
establish a SmartWay Financing Program to competitively award funding
to eligible entities identified by the Administrator in accordance with
the program requirements in subsection (g).
``(f) Purpose.--Under the SmartWay Financing Program, eligible
entities shall--
``(1) use funds awarded by the Administrator to provide
flexible loan and lease terms that increase approval rates or
lower the costs of loans and leases in accordance with guidance
developed by the Administrator; and
``(2) make such loans and leases available to public and
private entities for the purpose of adopting low-greenhouse gas
technologies or strategies for the mobile source sector that
are designated by the Administrator.
``(g) Program Requirements.--The Administrator shall determine
program design elements and requirements, including--
``(1) the type of financial mechanism with which to award
funding, in the form of grants or contracts;
``(2) the designation of eligible entities to receive
funding, including State, tribal, and local governments,
regional organizations comprised of governmental units,
nonprofit organizations, or for-profit companies;
``(3) criteria for evaluating applications from eligible
entities, including anticipated--
``(A) cost-effectiveness of loan or lease program
on a metric-ton-of-greenhouse gas-saved-per-dollar
basis;
``(B) ability to promote the loan or lease program
and associated technologies and strategies to the
target audience; and
``(4) reporting requirements for entities that receive
awards, including--
``(A) actual cost-effectiveness and greenhouse gas
savings from the loan or lease program based on a
methodology designated by the Administrator;
``(B) the total number of applications and number
of approved applications; and
``(C) terms granted to loan and lease recipients
compared to prevailing market practices.
``(h) Authorization of Appropriations.--Such sums as necessary are
authorized to be appropriated to the Administrator to carry out this
section.''.
SEC. 224. STATE VEHICLE FLEETS.
Section 507(o) of the Energy Policy Act of 1992 (42 U.S.C. 13257)
is amended by adding the following new paragraph at the end thereof:
``(3) The Secretary shall revise the rules under this subsection
with respect to the types of alternative fueled vehicles required for
compliance with this subsection to ensure those rules are consistent
with any guidance issued pursuant to section 303 of this Act.''.
Subtitle D--Industrial Energy Efficiency Programs
SEC. 241. INDUSTRIAL PLANT ENERGY EFFICIENCY STANDARDS.
The Secretary of Energy shall continue to support the development
of the American National Standards Institute (ANSI) voluntary
industrial plant energy efficiency certification program, pending
International Standards Organization (ISO) consensus standard 50001,
and other related ANSI/ISO standards. In addition, the Department shall
undertake complementary activities through the Department of Energy's
Industry Technologies Program that support the voluntary implementation
of such standards by manufacturing firms. There are authorized to be
appropriated to the Secretary such sums as are necessary to carry out
these activities. The Secretary shall report to Congress on the status
of standards development and plans for further standards development
pursuant to this section by not later than 18 months after the date of
enactment of this Act, and shall prepare a second such report 18 months
thereafter.
SEC. 242. ELECTRIC AND THERMAL WASTE ENERGY RECOVERY AWARD PROGRAM.
(a) Electric and Thermal Waste Energy Recovery Awards.--The
Secretary of Energy shall establish a program to make monetary awards
to the owners and operators of new and existing electric energy
generation facilities or thermal energy production facilities using
fossil or nuclear fuel, to encourage them to use innovative means of
recovering any thermal energy that is a potentially useful byproduct of
electric power generation or other processes to--
(1) generate additional electric energy; or
(2) make sales of thermal energy not used for electric
generation, in the form of steam, hot water, chilled water, or
desiccant regeneration, or for other commercially valid
purposes.
(b) Amount of Awards.--
(1) Eligibility.--Awards shall be made under subsection (a)
only for the use of innovative means that achieve net energy
efficiency at the facility concerned significantly greater than
the current standard technology in use at similar facilities.
(2) Amount.--The amount of an award made under subsection
(a) shall equal an amount up to the value of 25 percent of the
energy projected to be recovered or generated during the first
5 years of operation of the facility using the innovative
energy recovery method, or such lesser amount that the
Secretary determines to be the minimum amount that can cost-
effectively stimulate such innovation.
(3) Limitation.--No person may receive an award under this
section if a grant under the waste energy incentive grant
program under section 373 of the Energy Policy and Conservation
Act (42 U.S.C. 6343) is made for the same energy savings
resulting from the same innovative method.
(c) Regulatory Status.--The Secretary of Energy shall--
(1) assist State regulatory commissions to identify and
make changes in State regulatory programs for electric
utilities to provide appropriate regulatory status for thermal
energy byproduct businesses of regulated electric utilities to
encourage those utilities to enter businesses making the sales
referred to in subsection (a)(2); and
(2) encourage self-regulated utilities to enter businesses
making the sales referred to in subsection (a)(2).
(d) Authorization of Appropriations.--There are authorized to be
appropriated to the Secretary of Energy such sums as are necessary for
the purposes of this section.
SEC. 243. CLARIFYING ELECTION OF WASTE HEAT RECOVERY FINANCIAL
INCENTIVES.
Section 373(e) of the Energy Policy and Conservation Act (42 U.S.C.
6343(e)) is amended--
(1) by striking ``that qualifies for'' and inserting ``who
elects to claim''; and
(2) by inserting ``from that project'' after ``for waste
heat recovery''.
SEC. 244. MOTOR MARKET ASSESSMENT AND COMMERCIAL AWARENESS PROGRAM.
(a) Findings.--Congress finds that--
(1) electric motor systems account for about half of the
electricity used in the United States;
(2) electric motor energy use is determined by both the
efficiency of the motor and the system in which the motor
operates;
(3) Federal Government research on motor end use and
efficiency opportunities is more than a decade old; and
(4) the Census Bureau has discontinued collection of data
on motor and generator importation, manufacture, shipment, and
sales.
(b) Definitions.--In this section:
(1) Department.--The term ``Department'' means the
Department of Energy.
(2) Interested parties.--The term ``interested parties''
includes--
(A) trade associations;
(B) motor manufacturers;
(C) motor end users;
(D) electric utilities; and
(E) individuals and entities that conduct energy
efficiency programs.
(3) Secretary.--The term ``Secretary'' means the Secretary
of Energy, in consultation with interested parties.
(c) Assessment.--The Secretary shall conduct an assessment of
electric motors and the electric motor market in the United States that
shall--
(1) include important subsectors of the industrial and
commercial electric motor market (as determined by the
Secretary), including--
(A) the stock of motors and motor-driven equipment;
(B) efficiency categories of the motor population;
and
(C) motor systems that use drives, servos, and
other control technologies;
(2) characterize and estimate the opportunities for
improvement in the energy efficiency of motor systems by market
segment, including opportunities for--
(A) expanded use of drives, servos, and other
control technologies;
(B) expanded use of process control, pumps,
compressors, fans or blowers, and material handling
components; and
(C) substitution of existing motor designs with
existing and future advanced motor designs, including
electronically commutated permanent magnet, interior
permanent magnet, and switched reluctance motors; and
(3) develop an updated profile of motor system purchase and
maintenance practices, including surveying the number of
companies that have motor purchase and repair specifications,
by company size, number of employees, and sales.
(d) Recommendations; Update.--Based on the assessment conducted
under subsection (c), the Secretary shall--
(1) develop--
(A) recommendations to update the detailed motor
profile on a periodic basis;
(B) methods to estimate the energy savings and
market penetration that is attributable to the Save
Energy Now Program of the Department; and
(C) recommendations for the Director of the Census
Bureau on market surveys that should be undertaken in
support of the motor system activities of the
Department; and
(2) prepare an update to the Motor Master+ program of the
Department.
(e) Program.--Based on the assessment, recommendations, and update
required under subsections (c) and (d), the Secretary shall establish a
proactive, national program targeted at motor end-users and delivered
in cooperation with interested parties to increase awareness of--
(1) the energy and cost-saving opportunities in commercial
and industrial facilities using higher efficiency electric
motors;
(2) improvements in motor system procurement and management
procedures in the selection of higher efficiency electric
motors and motor-system components, including drives, controls,
and driven equipment; and
(3) criteria for making decisions for new, replacement, or
repair motor and motor system components.
SEC. 245. MOTOR EFFICIENCY REBATE PROGRAM.
(a) In General.--Part C of title III of the Energy Policy and
Conservation Act (42 U.S.C. 6311 et seq.) is amended by adding at the
end the following:
``SEC. 347. MOTOR EFFICIENCY REBATE PROGRAM.
``(a) Establishment.--Not later than January 1, 2010, in accordance
with subsection (b), the Secretary shall establish a program to provide
rebates for expenditures made by entities--
``(1) for the purchase and installation of a new electric
motor that has a nominal full load efficiency that is not less
than the nominal full load efficiency as defined in--
``(A) table 12-12 of NEMA Standards Publication MG
1-2006 for random wound motors rated 600 volts or
lower; or
``(B) table 12-13 of NEMA Standards Publication MG
1-2006 for form wound motors rated 5000 volts or lower;
and
``(2) to replace an installed motor of the entity the
specifications of which are established by the Secretary by a
date that is not later than 90 days after the date of enactment
of this section.
``(b) Requirements.--
``(1) Application.--To be eligible to receive a rebate
under this section, an entity shall submit to the Secretary an
application in such form, at such time, and containing such
information as the Secretary may require, including--
``(A) demonstrated evidence that the entity
purchased an electric motor described in subsection
(a)(1) to replace an installed motor described in
subsection (a)(2);
``(B) demonstrated evidence that the entity--
``(i) removed the installed motor of the
entity from service; and
``(ii) properly disposed the installed
motor of the entity; and
``(C) the physical nameplate of the installed motor
of the entity.
``(2) Authorized amount of rebate.--The Secretary may
provide to an entity that meets each requirement under
paragraph (1) a rebate the amount of which shall be equal to
the product obtained by multiplying--
``(A) the nameplate horsepower of the electric
motor purchased by the entity in accordance with
subsection (a)(1); and
``(B) $25.00.
``(3) Payments to distributors of qualifying electric
motors.--To assist in the payment for expenses relating to
processing and motor core disposal costs, the Secretary shall
provide to the distributor of an electric motor described in
subsection (a)(1), the purchaser of which received a rebate
under this section, an amount equal to the product obtained by
multiplying--
``(A) the nameplate horsepower of the electric
motor; and
``(B) $5.00.
``(c) Authorization of Appropriations.--There are authorized to be
appropriated to carry out this section, to remain available until
expended--
``(1) $80,000,000 for fiscal year 2011;
``(2) $75,000,000 for fiscal year 2012;
``(3) $70,000,000 for fiscal year 2013;
``(4) $65,000,000 for fiscal year 2014; and
``(5) $60,000,000 for fiscal year 2015.''.
(b) Table of Contents.--The table of contents of the Energy Policy
and Conservation Act (42 U.S.C. prec. 6201) is amended by adding at the
end of the items relating to part C of title III the following:
``Sec. 347. Motor efficiency rebate program.''.
SEC. 246. CLEAN ENERGY MANUFACTURING REVOLVING LOAN FUND PROGRAM.
The National Institute of Standards and Technology Act (15 U.S.C.
271 et seq.) is amended by inserting after section 26 the following:
``SEC. 27. CLEAN ENERGY MANUFACTURING REVOLVING LOAN FUND PROGRAM.
``(a) Purposes.--The purposes of this section are as follows:
``(1) To develop the long-term manufacturing capacity of
the United States.
``(2) To create jobs through the retooling and expansion of
manufacturing facilities to produce clean energy technology
products and energy efficient products.
``(3) To improve the long-term competitiveness of domestic
manufacturing by increasing the energy efficiency of
manufacturing facilities.
``(4) To assist small and medium-sized manufacturers
diversify operations to respond to emerging clean energy
technology product markets.
``(b) Definitions.--In this section:
``(1) Clean energy technology product.--The term `clean
energy technology product' means technology products relating
to the following:
``(A) Wind turbines.
``(B) Solar energy.
``(C) Fuel cells.
``(D) Advanced batteries, battery systems, or
storage devices.
``(E) Biomass equipment.
``(F) Geothermal equipment.
``(G) Advanced biofuels.
``(H) Ocean energy equipment.
``(I) Carbon capture and storage.
``(J) Such other products as the Secretary
determines--
``(i) relate to the production, use,
transmission, storage, control, or conservation
of energy;
``(ii) reduce greenhouse gas
concentrations;
``(iii) achieve the earliest and maximum
emission reductions within a reasonable period
per dollar invested;
``(iv) result in the fewest non-greenhouse
gas environmental impacts; and
``(v) either--
``(I) reduce the need for
additional energy supplies by--
``(aa) using existing
energy supplies with greater
efficiency; or
``(bb) by transmitting,
distributing, or transporting
energy with greater
effectiveness through the
infrastructure of the United
States; or
``(II) diversity the sources of
energy supply of the United States--
``(aa) to strengthen energy
security; and
``(bb) to increase supplies
with a favorable balance of
environmental effects if the
entire technology system is
considered.
``(2) Energy efficient product.--The term `energy efficient
product' means a product that, as determined by the Secretary
in consultation with the Secretary of Energy--
``(A) consumes significantly less energy than the
average amount that all similar products consumed on
the day before the date of the enactment of this Act;
or
``(B) is a component, system, or group of
subsystems that is designed, developed, and validated
to optimize the energy efficiency of a product.
``(3) Hollings manufacturing extension center.--The term
`Hollings Manufacturing Extension Center' means a center
established under section 25.
``(4) Hollings manufacturing partnership program.--The term
`Hollings Manufacturing Partnership Program' means the program
established under sections 25 and 26.
``(5) Program.--The term `Program' means the grant program
established pursuant to subsection (c)(1).
``(6) Revolving loan fund.--The term `revolving loan fund'
means a revolving loan fund described in subsection (d).
``(7) Secretary.--Except as otherwise provided, the term
`Secretary' means the Secretary of Commerce.
``(8) Small or medium-sized manufacturer.--The term `small
or medium-sized manufacturer' means a manufacturer that employs
fewer than 500 full-time equivalent employees at a
manufacturing facility that is not owned or controlled by an
automobile manufacturer.
``(c) Grant Program.--
``(1) Establishment.--Not later than 120 days after the
date of the enactment of this section, the Secretary shall
establish a program under which the Secretary shall award
grants to States to establish revolving loan funds to provide
loans to small and medium-sized manufacturers to finance the
cost of--
``(A) reequipping, expanding, or establishing
(including applicable engineering costs) a
manufacturing facility in the United States to
produce--
``(i) clean energy technology products;
``(ii) energy efficient products; or
``(iii) integral component parts of clean
energy technology products or energy efficient
products; or
``(B) reducing the energy intensity or greenhouse
gas production of a manufacturing facility in the
United States, including using energy intensive
feedstocks.
``(2) Maximum amount.--The Secretary may not award a grant
under the Program in an amount that exceeds $500,000,000 in any
fiscal year.
``(d) Criteria for Awarding Grants.--
``(1) Matching funds.--The Secretary may make a grant to a
State under the Program only if the State agrees to ensure that
for each loan provided by the State under the Program, not less
than 20 percent of the amount of each loan will come from a
non-Federal source.
``(2) Administrative costs.--A State receiving a grant
under the Program may only use such amount of the grant for the
costs of administering the revolving loan fund as the Secretary
shall provide in regulations.
``(3) Application.--Each State seeking a grant under the
Program shall submit to the Secretary an application therefor
in such form and in such manner as the Secretary considers
appropriate.
``(4) Evaluation.--The Secretary shall evaluate and
prioritize an application submitted by a State for a grant
under the Program on the basis of--
``(A) the description of the revolving loan fund to
be established with the grant and how such revolving
loan fund will achieve the purposes described in
subsection (a);
``(B) whether the State will be able to provide
loans from the revolving loan fund to small or medium-
sized manufacturers before the date that is 120 days
after the date on which the State receives the grant;
``(C) a description of how the State will
administer the revolving loan fund in coordination with
other State and Federal programs, including programs
administered by the Assistant Secretary for Economic
Development;
``(D) a description of the actual or potential
clean energy manufacturing supply chains, including
significant component parts, in the region served by
the revolving loan fund;
``(E) how the State will target the provision of
loans under the Program to manufacturers located in
regions characterized by high unemployment and sudden
and severe economic dislocation, in particular where
mass layoffs have resulted in a precipitous increase in
unemployment;
``(F) the availability of a skilled manufacturing
workforce in the region served by the revolving loan
fund and the capacity of the region's workforce and
education systems to provide pathways for unemployed or
low-income workers into skilled manufacturing
employment;
``(G) a description of how the State will target
loans to small or medium-sized manufacturers who are--
``(i) manufacturers of automobile
components; and
``(ii) either--
``(I) increasing the energy
efficiency of their manufacturing
facilities; or
``(II) retooling to manufacture
clean energy products or energy
efficient products, including
manufacturing components to improve the
compliance of an automobile with fuel
economy standards prescribed under
section 32902 of title 49, United
States Code;
``(H) a description of how the State will use the
loan fund to achieve the earliest and maximum
greenhouse gas emission reductions within a reasonable
period of time per dollar invested and with the fewest
non-greenhouse gas environmental impacts; and
``(I) such other factors as the Secretary considers
appropriate to ensure that grants awarded under the
Program effectively and efficiently achieve the
purposes described in subsection (a).
``(e) Revolving Loan Funds.--
``(1) In general.--A State receiving a grant under the
Program shall establish, maintain, and administer a revolving
loan fund in accordance with this subsection.
``(2) Deposits.--A revolving loan fund shall consist of the
following:
``(A) Amounts from grants awarded under this
section.
``(B) All amounts held or received by the State
incident to the provision of loans described in
subsection (f), including all collections of principal
and interest.
``(3) Expenditures.--Amounts in the revolving loan fund
shall be available for the provision and administration of
loans in accordance with subsection (f).
``(4) Limitation.--No funds provided pursuant to this
section may be leveraged through use of tax-exempt bonding
authority by a State or a political subdivision of a State.
``(f) Loans.--
``(1) In general.--A State receiving a grant under this
section shall use the amount in the revolving loan fund to
provide loans to small and medium-sized manufacturers as
described in subsection (c)(1).
``(2) Loan terms and conditions.--The following shall apply
with respect to loans provided under paragraph (1):
``(A) Terms.--Loans shall have a term determined by
the State receiving the grant as follows:
``(i) For fixed assets, the term of the
loan shall not exceed the useful life of the
asset and shall be less than 15 years.
``(ii) For working capital, the term of the
loan shall not exceed 36 months.
``(B) Interest rates.--Loans shall bear an interest
rate determined by the State receiving the grant as
follows:
``(i) The interest rate shall enable the
loan recipient to accomplish the activities
described in subparagraphs (A) and (B) of
subsection (c)(1).
``(ii) The interest rate may be set below-
market interest rates.
``(iii) The interest rate may not be less
than zero percent.
``(iv) The interest rate may not exceed the
current prime rate plus 500 basis points.
``(C) Description and budget for use of loan
funds.--Each recipient of a loan from a State under the
Program shall develop and submit to the State and the
Secretary a description and budget for the use of loan
amounts, including a description of the following:
``(i) Any new business expected to be
developed with the loan.
``(ii) Any improvements to manufacturing
operations to be developed with the loan.
``(iii) Any technology expected to be
commercialized with the loan.
``(D) Priority in review and preference in
selection for certain loan applicants.--
``(i) Review.--In reviewing applications
submitted by small or medium-sized
manufacturers for a loan, a recipient of a
grant under the Program shall give priority to
small or medium-sized manufacturers described
in clause (iii).
``(ii) Selection.--In selecting small or
medium-sized manufacturers to receive a loan, a
recipient of a grant under the Program shall
give preference to small or medium-sized
manufacturers described in clause (iii).
``(iii) Priority and preferred small or
medium-sized manufacturers.--A small or medium-
sized manufacturer described in this clause is
a manufacturer that--
``(I) is certified by a Hollings
Manufacturing Extension Center or a
manufacturing-related local
intermediary designated by the
Secretary for purposes of providing
such certification; or
``(II) provides individuals
employed at the manufacturing
facilities of the manufacturer--
``(aa) pay in amounts that
are, on average, equal to or
more than the average wage of
an individual working in a
manufacturing facility in the
State; and
``(bb) health benefits.
``(iv) Certification by hollings
manufacturing extension center.--A Hollings
Manufacturing Extension Center or other entity
designated by the Secretary for purposes of
providing certification under clause (iii)(I)
shall only certify applications for a loan
after carrying out a qualitative and
quantitative review of the applicant's business
strategy, manufacturing operations, and
technological ability to contribute to the
purposes described in subsection (a).
``(E) Repayment upon relocation outside united
states.--
``(i) In general.--If a person receives a
loan under paragraph (1) to finance the cost of
reequipping, expanding, or establishing a
manufacturing facility as described in
subsection (c)(1)(A) or to reduce the energy
intensity of a manufacturing facility and such
person relocates the production activities of
such manufacturing facility outside the United
States during the term of the loan, the
recipient shall repay such loan in full with
interest as described in clause (ii) and for a
duration described in clause (iii).
``(ii) Payment of interest.--Any amount
owed by the recipient of a loan under paragraph
(1) who is required to repay the loan under
clause (i) shall bear interest at a penalty
rate determined by the Secretary to deter
recipients of loans under paragraph (1) from
relocating production activities as described
in clause (i).
``(iii) Period of repayment.--Repayment of
a loan under clause (i) shall be for a duration
determined by the Secretary.
``(F) Compliance with wage rate requirements.--Each
recipient of a loan shall undertake and agree to
incorporate or cause to be incorporated into all
contracts for construction, alteration or repair, which
are paid for in whole or in part with funds obtained
pursuant to such loan, a requirement that all laborers
and mechanics employed by contractors and
subcontractors performing construction, alteration or
repair shall be paid wages at rates not less than those
determined by the Secretary of Labor, in accordance
with subchapter IV of chapter 31 of title 40, United
States Code (known as the `Davis-Bacon Act'), to be
prevailing for the corresponding classes of laborers
and mechanics employed on projects of a character
similar to the contract work in the same locality in
which the work is to be performed. The Secretary of
Labor shall have, with respect to the labor standards
specified in this subparagraph, the authority and
functions set forth in Reorganization Plan Numbered 14
of 1950 (15 Fed. Reg. 3176; 64 Stat. 1267) and section
3145 of title 40, United States Code.
``(G) Annual reports by loan recipients.--Each
recipient of a loan issued by a State under paragraph
(1) shall, not less frequently than once each year
during the term of the loan, submit to such State a
report containing such information as the Secretary may
specify for purposes of the Program, including
information that the Secretary can use to determine
whether a recipient of a loan is required to repay the
loan under subparagraph (E).
``(3) Annual reports by grant recipients.--Each recipient
of a grant under the Program shall, not less frequently than
once each year, submit to the Secretary a report on the impact
of each loan issued by the State under the Program and the
aggregate impact of all loans so issued, including the
following:
``(A) The sales increased or retained.
``(B) Cost savings or costs avoided.
``(C) Additional investment encouraged.
``(D) Jobs created or retained.
``(g) Authorization of Appropriations.--There is authorized to be
appropriated to carry out this section $15,000,000,000 for each of
fiscal years 2010 and 2011.''.
SEC. 247. CLEAN ENERGY AND EFFICIENCY MANUFACTURING PARTNERSHIPS.
(a) Hollings Manufacturing Partnership Program.--Section 25(b) of
the National Institute of Standards and Technology Act (15 U.S.C.
278k(b)) is amended--
(1) in paragraph (2), by striking ``and'' at the end;
(2) in paragraph (3), by striking the period at the end and
inserting ``; and''; and
(3) by adding at the end the following:
``(4) the establishment of a clean energy manufacturing
supply chain initiative--
``(A) to support manufacturers in their
identification of and diversification to new markets,
including support for manufacturers transitioning to
the use of clean energy supply chains;
``(B) to assist manufacturers improve their
competitiveness by reducing energy intensity and
greenhouse gas production, including the use of energy
intensive feedstocks;
``(C) to increase adoption and implementation of
innovative manufacturing technologies;
``(D) to coordinate and leverage the expertise of
the National Laboratories and Technology Centers and
the Industrial Assessment Centers of the Department of
Energy to meet the needs of manufacturers; and
``(E) to identify, assist, and certify
manufacturers seeking loans under section 27(e)(1).''.
(b) Reduction in Cost Share Requirements.--Section 25(c) of such
Act (15 U.S.C. 278k(c)) is amended--
(1) in paragraph (1), by inserting ``or as provided in
paragraph (5)'' after ``not to exceed six years'';
(2) in paragraph (3)(B), by striking ``not less than 50
percent of the costs incurred for the first 3 years and an
increasing share for each of the last 3 years'' and inserting
``50 percent of the costs incurred or such lesser percentage of
the costs incurred as determined appropriate by the Secretary
by rule''; and
(3) in paragraph (5)--
(A) by striking ``at declining levels'';
(B) by striking ``one third'' and inserting ``50
percent''; and
(C) by inserting ``, or such lesser percentage as
determined appropriate by the Secretary by rule,''
after ``maintenance costs''.
(c) Authorization of Appropriations.--There are authorized to be
appropriated to the Secretary of Commerce for the Hollings
Manufacturing Partnership Program authorized under sections 25 of the
National Institute of Standards and Technology Act (15 U.S.C. 278k) and
for the provision of assistance under section 26 of such Act (15 U.S.C.
278l)--
(1) $200,000,000 for fiscal year 2010;
(2) $250,000,000 for fiscal year 2011;
(3) $300,000,000 for fiscal year 2012;
(4) $350,000,000 for fiscal year 2013; and
(5) $400,000,000 for fiscal year 2014.
SEC. 248. TECHNICAL AMENDMENTS.
(a) Amendment to National Institute of Standards and Technology
Act.--Section 25 of the National Institute of Standards and Technology
Act (15 U.S.C. 278k(b)) is amended--
(1) in subsection (a), by striking ``(hereafter in this Act
referred to as the `Centers')''; and
(2) by adding at the end the following:
``(g) Designation.--
``(1) Hollings manufacturing partnership program.--The
program under this section shall be known as the `Hollings
Manufacturing Partnership Program'.
``(2) Hollings manufacturing extension centers.--The
Regional Centers for the Transfer of Manufacturing Technology
created and supported under subsection (a) shall be known as
the `Hollings Manufacturing Extension Centers' (in this Act
referred to as the `Centers').''.
(b) Amendment to Consolidated Appropriations Act, 2005.--Division B
of title II of the Consolidated Appropriations Act, 2005 (Public Law
108-447; 118 Stat. 2879; 15 U.S.C. 278k note) is amended under the
heading ``industrial technology services'' by striking ``2007: Provided
further, That'' and all that follows through ``Extension Centers.'' and
inserting ``2007.''.
Subtitle E--Improvements in Energy Savings Performance Contracting
SEC. 251. ENERGY SAVINGS PERFORMANCE CONTRACTS.
(a) Competition Requirements for Task or Delivery Orders Under
Energy Savings Performance Contracts.--
(1) Competition requirements.--Subsection (a) of section
801 of the National Energy Conservation Policy Act (42 U.S.C.
8287(a)) is amended by adding at the end the following
paragraph:
``(3)(A) The head of a Federal agency may issue a task or delivery
order under an energy savings performance contract by--
``(i) notifying all contractors that have received an award
under such contract that the agency proposes to discuss energy
savings performance services for some or all of its facilities
and, following a reasonable period of time to provide a
proposal in response to the notice, soliciting an expression of
interest in performing site surveys or investigations and
feasibility designs and studies and the submission of
qualifications from such contractors, and including in such
notice summary information concerning energy use for any
facilities that the agency has specific interest in including
in such contract;
``(ii) reviewing all expressions of interest and
qualifications submitted pursuant to the notice under clause
(i);
``(iii) selecting two or more contractors (from among those
reviewed under clause (ii)) to conduct discussions concerning
the contractors' respective qualifications to implement
potential energy conservation measures, including requesting
references demonstrating experience on similar efforts and the
resulting energy savings of such similar efforts, and providing
an opportunity for a post-award debriefing to all contractors
that submitted expressions of interest and qualifications under
clause (ii) pursuant to the notice;
``(iv) selecting and authorizing--
``(I) more than one contractor (from among those
selected under clause (iii)) to conduct site surveys,
investigations, feasibility designs and studies or
similar assessments for the energy savings performance
contract services (or for discrete portions of such
services), for the purpose of allowing each such
contractor to submit a firm, fixed-price proposal to
implement specific energy conservation measures; or
``(II) one contractor (from among those selected
under clause (iii)) to conduct a site survey,
investigation, a feasibility design and study or
similar for the purpose of allowing the contractor to
submit a firm, fixed-price proposal to implement
specific energy conservation measures;
``(v) negotiating a task or delivery order for energy
savings performance contracting services with the contractor or
contractors selected under clause (iv) based on the energy
conservation measures identified; and
``(vi) issuing a task or delivery order for energy savings
performance contracting services to such contractor or
contractors.
``(B) The issuance of a task or delivery order for energy savings
performance contracting services pursuant to subparagraph (A) is deemed
to satisfy the task and delivery order competition requirements in
section 2304c(d) of title 10, United States Code, and section 303J(d)
of the Federal Property and Administrative Services Act of 1949 (41
U.S.C. 253j(d)).
``(C) The Secretary may issue guidance as necessary to agencies
issuing task or delivery orders pursuant to subparagraph (A).''.
(2) Effective date.--The amendment made by paragraph (1) is
inapplicable to task or delivery orders issued before the date
of enactment of this section.
(b) Inclusion of Thermal Renewable Energy.--Section 203 of the
Energy Policy Act of 2005 (42 U.S.C. 15852) is amended--
(1) in subsection (a), by striking ``electric''; and
(2) in subsection (b)(2), by inserting ``or thermal'' after
``means electric''.
(c) Credit for Renewable Energy Produced and Used on Site.--
Subsection (c) of section 203 of the Energy Policy Act of 2005 (42
U.S.C. 15852) is amended to read as follows:
``(c) Calculation.--Renewable energy produced at a Federal
facility, on Federal lands, or on Indian lands (as defined in title
XXVI of the Energy Policy Act of 1992 (25 U.S.C. 3501 et seq.)) shall
be calculated separately from renewable energy consumed at a Federal
facility, and each may be used to comply with the consumption
requirement under subsection (a).''.
(d) Financing Flexibility.--Section 801(a)(2)(E) of the National
Energy Conservation Policy Act (42 U.S.C. 8287(a)(2)(E)) is amended by
striking ``In'' and inserting ``Notwithstanding any other provision of
law, in''.
Subtitle F--Public Institutions
SEC. 261. PUBLIC INSTITUTIONS.
Section 399A of the Energy Policy and Conservation Act (42 U.S.C.
6371h-1) is amended--
(1) in subsection (a)(5), by striking ``or a designee'' and
inserting ``an Indian tribe, a not-for-profit hospital or not-
for-profit inpatient health care facility, or a designated
agent'';
(2) in subsection (c)(1), by striking subparagraph (C);
(3) in subsection (f)(3)(A), by striking ``$1,000,000'' and
inserting ``$2,500,000''; and
(4) in subsection (i)(1), by striking ``$250,000,000 for
each of fiscal years 2009 through 2013'' and inserting
``$250,000,000 for each of fiscal years 2010 through 2015''.
SEC. 262. COMMUNITY ENERGY EFFICIENCY FLEXIBILITY.
Section 545(b)(3) of the Energy Independence and Security Act of
2007 (42 U.S.C. 17155(b)(3)) is amended--
(1) by striking ``Indian tribe may use'' and all that
follows through ``for administrative expenses'' and inserting
``Indian tribe may use for administrative expenses'';
(2) by striking subparagraphs (B) and (C);
(3) by redesignating the remaining clauses (i) and (ii) as
subparagraphs (A) and (B), respectively and adjusting the
margin of those subparagraphs accordingly; and
(4) by striking the semicolon at the end and inserting a
period.
SEC. 263. SMALL COMMUNITY JOINT PARTICIPATION.
(a) Section 541(3)(A) of the Energy Independence and Security Act
of 2007 is amended in clause (i) by striking ``and'' at the end of
subclause (II), in clause (ii) by striking the period at the end of
subclause (II) and inserting ``; or'', and by inserting the following
new clause (iii):
``(iii) a group of adjacent, contiguous, or
geographically proximate units of local government that
reach agreement to act jointly for purposes of this
section and that represent a combined population of not
less than 35,000.''.
(b) Section 541(3)(B) of the Energy Independence and Security Act
of 2007 is amended in clause (i) by striking ``or'', in clause (ii) by
striking the period at the end and inserting ``; or'', and by inserting
the following new clause (iii):
``(iii) a group of adjacent, contiguous, or
geographically proximate units of local government that
reach agreement to act jointly for purposes of this
section and that represent a combined population of not
less than 50,000.''.
SEC. 264. LOW INCOME COMMUNITY ENERGY EFFICIENCY PROGRAM.
(a) In General.--The Secretary of Energy is authorized to make
grants to private, nonprofit, mission-driven community development
organizations including community development corporations and
community development financial institutions to provide financing to
businesses and projects that improve energy efficiency; identify and
develop alternative, renewable, and distributed energy supplies;
provide technical assistance and promote job and business opportunities
for low-income residents; and increase energy conservation in low
income rural and urban communities.
(b) Grants.--The purpose of such grants is to increase the flow of
capital and benefits to low income communities, minority-owned and
woman-owned businesses and entrepreneurs and other projects and
activities located in low income communities in order to reduce
environmental degradation, foster energy conservation and efficiency
and create job and business opportunities for local residents. The
Secretary may make grants on a competitive basis for--
(1) investments that develop alternative, renewable, and
distributed energy supplies;
(2) capitalizing loan funds that lend to energy efficiency
projects and energy conservation programs;
(3) technical assistance to plan, develop, and manage an
energy efficiency financing program; and
(4) technical and financial assistance to assist small-
scale businesses and private entities develop new renewable and
distributed sources of power or combined heat and power
generation.
(c) Authorization of Appropriations.--For the purposes of this
section there is authorized to be appropriated $50,000,000 for each of
the fiscal years 2010 through 2015.
SEC. 265. CONSUMER BEHAVIOR RESEARCH.
(a) In General.--The Secretary of Energy is authorized to establish
a research program to identify the factors affecting consumer actions
to conserve energy and make improvements in energy efficiency. Through
the program the Secretary will make grants to public and private
institutions of higher education to study the effects of consumer
behavior on total energy use; potential energy savings from changes in
consumption habits; the ability to reduce greenhouse gas emissions
through changes in energy consumption habits; increase public awareness
of Federal climate adaptation and mitigation programs; and the
potential for alterations in consumer behavior to further American
energy independence. Grants may also fund projects that evaluate or
inform public knowledge of the effects of energy consumption habits on
these topics.
(b) Grants.--The purpose of the program is to provide grants to
public and private institutions of higher education to carry out
projects which will improve understanding of the effects of consumer
behavior on energy consumption and conservation. The Secretary shall
make grants on a competitive basis for--
(1) studies of the effects of consumer habits on energy
consumption and conservation;
(2) development of strategies that communicate the
importance of energy efficiency and conservation to consumers;
(3) identification of best practices to improve consumer
energy use habits;
(4) education programs that inform consumers about the
implications of consumption habits on energy use and climate
change;
(5) evaluation of the effectiveness of programs designed to
promote public awareness of Federal Government climate
adaptation and mitigation activities; and
(6) other projects that advance the mission of the program.
(c) Report.--The Secretary of Energy shall provide Congress with a
report on progress towards establishing the program within 120 days
after the date of enactment of this Act.
(d) Authorization of Appropriations.--There are authorized to be
appropriated such sums as may be necessary to carry out this section.
Subtitle G--Miscellaneous
SEC. 271. ENERGY EFFICIENT INFORMATION AND COMMUNICATIONS TECHNOLOGIES.
Section 543 of the National Energy Conservation Policy Act (42
U.S.C. 8253) is amended to read as follows:
``SEC. 543. ENERGY EFFICIENT INFORMATION AND COMMUNICATIONS
TECHNOLOGIES.
``(a) In General.--Not later than 1 year after the date of
enactment of the American Clean Energy and Security Act of 2009, each
Federal agency shall collaborate with the Director of the Office of
Management and Budget (referred to in this section as the `Director')
to create an implementation strategy, including best practices and
measurement and verification techniques, for the purchase and use of
energy efficient information and communications technologies and
practices. Wherever possible, existing standards, specifications,
performance metrics, and best management practices that have been or
are being developed in open collaboration and with broad stakeholder
input and review should be incorporated. In addition, agency strategies
shall be flexible, cost-effective, and based on the specific operating
requirements and statutory mission of each agency.
``(b) Energy Efficient Information and Communications
Technologies.--In developing an implementation strategy, each agency
shall--
``(1) consider information and communications technologies
and infrastructure, including, but not limited to, advanced
metering infrastructure, information and communications
technology services and products, efficient data center
strategies, applications modernization and rationalization,
building systems energy efficiency, and telework; and
``(2) ensure that agencies are eligible to realize the
savings and rewards brought about through increased
efficiencies.
``(c) Performance Goals.--Not later than 6 months after the date of
enactment of the American Clean Energy and Security Act of 2009, the
Director shall establish performance goals for evaluating the efforts
of the agencies in improving the maintenance, purchase and use of
energy efficiency of information and communications technology systems.
These performance goals should measure information technology costs
over a specific time horizon (3 to 5 years), providing a complete
picture of all costs, including energy.
``(d) Report.--Not later than 18 months after the date of enactment
of the American Clean Energy and Security Act of 2009, and annually
thereafter, the Director shall submit a report to Congress on--
``(1) the progress of each agency in reducing energy use
through its implementation strategy; and
``(2) new and emerging technologies that would help achieve
increased energy efficiency.''.
SEC. 272. NATIONAL ENERGY EFFICIENCY GOALS.
(a) Goals.--The energy efficiency goals of the United States are--
(1) to achieve an improvement in the overall energy
productivity of the United States (measured in gross domestic
product per unit of energy input) of at least 2.5 percent per
year by the year 2012; and
(2) to maintain that annual rate of improvement each year
through 2030.
(b) Strategic Plan.--
(1) In general.--Not later than 1 year after the date of
enactment of this Act, the Secretary of Energy (referred to in
this section as the ``Secretary''), in cooperation with the
Administrator and the heads of other appropriate Federal
agencies, shall develop a strategic plan to achieve the
national goals for improvement in energy productivity
established under subsection (a).
(2) Public input and comment.--The Secretary shall develop
the plan in a manner that provides appropriate opportunities
for public input and comment.
(c) Plan Contents.--The strategic plan shall--
(1) identify future regulatory, funding, and policy
priorities that would assist the United States in meeting the
national goals;
(2) include energy savings estimates for each sector; and
(3) include data collection methodologies and compilations
used to establish baseline and energy savings data.
(d) Plan Updates.--
(1) In general.--The Secretary shall--
(A) update the strategic plan biennially; and
(B) include the updated strategic plan in the
national energy policy plan required by section 801 of
the Department of Energy Organization Act (42 U.S.C.
7321).
(2) Contents.--In updating the plan, the Secretary shall--
(A) report on progress made toward implementing
efficiency policies to achieve the national goals
established under subsection (a); and
(B) verify, to the maximum extent practicable,
energy savings resulting from the policies.
(e) Report to Congress and the Public.--The Secretary shall submit
to Congress, and make available to the public, the initial strategic
plan developed under subsection (b) and each updated plan.
SEC. 273. AFFILIATED ISLAND ENERGY INDEPENDENCE TEAM.
(a) Definitions.--In this section:
(1) Affiliated island.--The term ``affiliated island''
means--
(A) the Commonwealth of Puerto Rico;
(B) Guam;
(C) American Samoa;
(D) the Commonwealth of the Northern Mariana
Islands;
(E) the Federated States of Micronesia;
(F) the Republic of the Marshall Islands;
(G) the Republic of Palau; and
(H) the United States Virgin Islands.
(2) Secretary.--The term ``Secretary'' means the Secretary
of Energy (acting through the Assistant Secretary of Energy
Efficiency and Renewable Energy), in consultation with the
Secretary of the Interior and the Secretary of State.
(3) Team.--The term ``team'' means the team established by
the Secretary under subsection (b).
(b) Establishment.--As soon as practicable after the date of
enactment of this Act, the Secretary shall assemble a team of
technical, policy, and financial experts to address the energy needs of
each affiliated island--
(1) to reduce the reliance and expenditure of each
affiliated island on imported fossil fuels;
(2) to increase the use by each affiliated island of
indigenous, nonfossil fuel energy sources;
(3) to improve the performance of the energy infrastructure
of the affiliated island through projects--
(A) to improve the energy efficiency of power
generation, transmission, and distribution; and
(B) to increase consumer energy efficiency;
(4) to improve the performance of the energy infrastructure
of each affiliated island through enhanced planning, education,
and training;
(5) to adopt research-based and public-private partnership-
based approaches as appropriate;
(6) to stimulate economic development and job creation; and
(7) to enhance the engagement by the Federal Government in
international efforts to address island energy needs.
(c) Duties of Team.--
(1) Energy action plans.--
(A) In general.--In accordance with subparagraph
(B), the team shall provide technical, programmatic,
and financial assistance to each utility of each
affiliated island, and the government of each
affiliated island, as appropriate, to develop and
implement an energy Action Plan for each affiliated
island to reduce the reliance of each affiliated island
on imported fossil fuels through increased efficiency
and use of indigenous clean-energy resources.
(B) Requirements.--Each Action Plan described in
subparagraph (A) for each affiliated island shall
require and provide for--
(i) the conduct of 1 or more studies to
assess opportunities to reduce fossil fuel use
through--
(I) the improvement of the energy
efficiency of the affiliated island;
and
(II) the increased use by the
affiliated island of indigenous clean-
energy resources;
(ii) the identification and implementation
of the most cost-effective strategies and
projects to reduce the dependence of the
affiliated island on fossil fuels;
(iii) the promotion of education and
training activities to improve the capacity of
the local utilities of the affiliated island,
and the government of the affiliated island, as
appropriate, to plan for, maintain, and operate
the energy infrastructure of the affiliated
island through the use of local or regional
institutions, as appropriate;
(iv) the coordination of the activities
described in clause (iii) to leverage the
expertise and resources of international
entities, the Department of Energy, the
Department of the Interior, and the regional
utilities of the affiliated island;
(v) the identification, and development, as
appropriate, of research-based and private-
public, partnership approaches to implement the
Action Plan; and
(vi) any other component that the Secretary
determines to be necessary to reduce
successfully the use by each affiliated island
of fossil fuels.
(2) Reports to secretary.--Not later than 1 year after the
date on which the Secretary establishes the team and biennially
thereafter, the team shall submit to the Secretary a report
that contains a description of the progress of each affiliated
island in--
(A) implementing the Action Plan of the affiliated
island developed under paragraph (1)(A); and
(B) reducing the reliance of the affiliated island
on fossil fuels.
(d) Use of Regional Utility Organizations.--To provide expertise to
affiliated islands to assist the affiliated islands in meeting the
purposes of this section, the Secretary shall consider--
(1) including regional utility organizations in the
establishment of the team; and
(2) providing assistance through regional utility
organizations.
(e) Annual Reports to Congress.--Not later than 30 days after the
date on which the Secretary receives a report submitted by the team
under subsection (c)(2), the Secretary shall submit to the appropriate
committees of Congress a report that contains a summary of the report
of the team.
(f) Authorization of Appropriations.--There are authorized to be
appropriated such sums as are necessary to carry out this section.
SEC. 274. PRODUCT CARBON DISCLOSURE PROGRAM.
(a) EPA Study.--The Administrator shall conduct a study to
determine the feasibility of establishing a national program for
measuring, reporting, publicly disclosing, and labeling products or
materials sold in the United States for their carbon content, and
shall, not later than 18 months after the date of enactment of this
Act, transmit a report to Congress which shall include the following:
(1) A determination of whether a national product carbon
disclosure program and labeling program would be effective in
achieving the intended goals of achieving greenhouse gas
reductions and an examination of existing programs globally and
their strengths and weaknesses.
(2) Criteria for identifying and prioritizing sectors and
products and processes that should be covered in such program
or programs.
(3) An identification of products, processes, or sectors
whose inclusion could have a substantial carbon impact
(prioritizing industrial products such as iron and steel,
aluminum, cement, chemicals, and paper products, and also
including food, beverage, hygiene, cleaning, household
cleaners, construction, metals, clothing, semiconductor, and
consumer electronics).
(4) Suggested methodology and protocols for measuring the
carbon content of the products across the entire carbon
lifecycle of such products for use in a carbon disclosure
program and labeling program.
(5) A review of existing greenhouse gas product accounting
standards, methodologies, and practices including the
Greenhouse Gas Protocol, ISO 14040/44, ISO 14067, and
Publically Available Specification 2050, and including a review
of the strengths and weaknesses of each.
(6) A survey of secondary databases including the
Manufacturing Energy Consumption Survey and evaluate the
quality of data for use in a product carbon disclosure program
and product carbon labeling program and an identification of
gaps in the data relative to the potential purposes of a
national product carbon disclosure program and product carbon
labeling program and development of recommendations for
addressing these data gaps.
(7) An assessment of the utility of comparing products and
the appropriateness of product carbon standards.
(8) An evaluation of the information needed on a label for
clear and accurate communication, including what pieces of
quantitative and qualitative information needs to be disclosed.
(9) An evaluation of the appropriate boundaries of the
carbon lifecycle analysis for different sectors and products.
(10) An analysis of whether default values should be
developed for products whose producer does not participate in
the program or does not have data to support a disclosure or
label and determine best ways to develop such default values.
(11) A recommendation of certification and verification
options necessary to assure the quality of the information and
avoid greenwashing or the use of insubstantial or meaningless
environmental claims to promote a product.
(12) An assessment of options for educating consumers about
product carbon content and the product carbon disclosure
program and product carbon labeling program.
(13) An analysis of the costs and timelines associated with
establishing a national product carbon disclosure program and
product carbon labeling program, including options for a phased
approach. Costs should include those for businesses associated
with the measurement of carbon footprints and those associated
with creating a product carbon label and managing and operating
a product carbon labeling program, and options for minimizing
these costs.
(14) An evaluation of incentives (such as financial
incentives, brand reputation, and brand loyalty) to determine
whether reductions in emissions can be accelerated through
encouraging more efficient manufacturing or by encouraging
preferences for lower-emissions products to substitute for
higher-emissions products whose level of performance is no
better.
(b) Development of National Carbon Disclosure Program.--Upon
conclusion of the study, and not more than 36 months after the date of
enactment of this Act, the Administrator shall establish a national
product carbon disclosure program, participation in which shall be
voluntary, and which may involve a product carbon label with broad
applicability to the wholesale and consumer markets to enable and
encourage knowledge about carbon content by producers and consumers and
to inform efforts to reduce energy consumption (carbon dioxide
equivalent emissions) nationwide. In developing such a program, the
Administrator shall--
(1) consider the results of the study conducted under
subsection (a);
(2) consider existing and planned programs and proposals
and measurement standards (including the Publicly Available
Specification 2050, standards to be developed by the World
Resource Institute/World Business Council for Sustainable
Development, the International Standards Organization, and the
bill AB19 pending in the California legislature);
(3) consider the compatibility of a national product carbon
disclosure program with existing programs;
(4) utilize incentives and other means to spur the adoption
of product carbon disclosure and product carbon labeling;
(5) develop protocols and parameters for a product carbon
disclosure program, including a methodology and formula for
assessing, verifying, and potentially labeling a product's
greenhouse gas content, and for data quality requirements to
allow for product comparison;
(6) create a means to--
(A) document best practices;
(B) ensure clarity and consistency;
(C) work with suppliers, manufacturers, and
retailers to encourage participation;
(D) ensure that protocols are consistent and
comparable across like products; and
(E) evaluate the effectiveness of the program;
(7) make publicly available information on product carbon
content to ensure transparency;
(8) provide for public outreach, including a consumer
education program to increase awareness;
(9) develop training and education programs to help
businesses learn how to measure and communicate their carbon
footprint and easy tools and templates for businesses to use to
reduce cost and time to measure their products' carbon
lifecycle;
(10) consult with the Secretary of Energy, the Secretary of
Commerce, the Federal Trade Commission, and other Federal
agencies, as necessary;
(11) gather input from stakeholders through consultations,
public workshops or hearings with representatives of consumer
product manufacturers, consumer groups, and environmental
groups;
(12) utilize systems for verification and product
certification that will ensure that claims manufacturers make
about their products are valid;
(13) create a process for reviewing the accuracy of product
carbon label information and protecting the product carbon
label in the case of a change in the product's energy source,
supply chain, ingredients, or other factors, and specify the
frequency to which data should be updated; and
(14) develop a standardized, easily understandable carbon
label, if appropriate, and create a process for responding to
inaccuracies and misuses of such a label.
(c) Report to Congress.--Not later than 5 years after the program
is established pursuant to subsection (b), the Administrator shall
report to Congress on the effectiveness and impact of the program, the
level of voluntary participation, and any recommendations for
additional measures.
(d) Definitions.--As used in this section--
(1) the term ``carbon content'' means the amount of
greenhouse gas emissions and their warming impact on the
atmosphere expressed in carbon dioxide equivalent associated
with a product's value chain;
(2) the term ``carbon footprint'' means the level of
greenhouse gas emissions produced by a particular activity,
service, or entity; and
(3) the term ``carbon lifecycle'' means the greenhouse gas
emissions that are released as part of the processes of
creating, producing, processing or manufacturing, modifying,
transporting, distributing, storing, using, recycling, or
disposing of goods and services.
(e) Authorization of Appropriations.--There is authorized to be
appropriated to the Administrator $5,000,000 for the study required by
subsection (a) and $25,000,000 for each of fiscal years 2010 through
2025 for the program required under subsection (b).
SEC. 275. INDUSTRIAL ENERGY EFFICIENCY EDUCATION AND TRAINING
INITIATIVE.
(a) In General.--The Secretary of Energy shall carry out a national
education and awareness program for the purpose of informing building,
facility, and industrial plant owners and managers and decisionmakers,
government leaders, and industry leaders about the large energy-saving
potential of greater use of mechanical insulation, and other benefits.
(b) Purpose and Goals.--
(1) Purpose.--The purpose of the initiative shall be to
increase the energy efficiency of the commercial and industrial
sectors through an ongoing program that will include--
(A) education and training sessions;
(B) Web-based information; and
(C) advertising.
(2) Goals.--The goals of the initiative shall be to--
(A) educate and motivate commercial building owners
and industrial facility managers to utilize mechanical
insulation in new and existing facilities;
(B) preserve and create jobs while reducing energy
and greenhouse gas emissions;
(C) create a safer working environment and make
businesses more competitive in a global economy; and
(D) motivate and empower the industry to make
better use of mechanical insulation through awareness,
education, and training.
(c) Report.--Not later than July 1, 2013, the Secretary shall
submit to Congress a report describing the extent by which the
initiative has been enacted and the actual and projected effectiveness
of the program under this section, including the energy efficiency,
greenhouse gas emissions reductions, cost savings, and safety benefits
at manufacturing facilities, power plants, refineries, hospitals,
universities, government buildings, and other commercial and industrial
locations.
(d) Authorization of Appropriations.--There are authorized to be
appropriated $3,500,000 for each of fiscal years 2010 through 2014 to
carry out this section. The Secretary may enter into a cooperative
agreement, including grant funding, with an industry association and
union working collaboratively and having expertise on the installation,
maintenance, measure of efficiencies and standards, and certification
of mechanical insulation in buildings and facilities.
(e) Termination of Authority.--The program carried out under this
section shall terminate on December 31, 2014.
SEC. 276. SENSE OF CONGRESS.
It is the sense of Congress that the United States should--
(1) continue to actively promote, within the International
Civil Aviation Organization, the development of a global
framework for the regulation of greenhouse gas emissions from
civil aircraft that recognizes the uniquely international
nature of the industry and treats commercial aviation
industries in all countries fairly; and
(2) work with foreign governments towards a global
agreement that reconciles foreign carbon emissions reduction
programs to minimize duplicative requirements and avoids
unnecessary complication for the aviation industry, while still
achieving the environmental goals.
Subtitle H--Green Resources for Energy Efficient Neighborhoods
SEC. 281. SHORT TITLE.
This subtitle may be cited as the ``Green Resources for Energy
Efficient Neighborhoods Act of 2009'' or the ``GREEN Act of 2009''.
SEC. 282. DEFINITIONS.
For purposes of this subtitle, the following definitions shall
apply:
(1) Green building standards.--The term ``green building
standards'' means standards to require use of sustainable
design principles to reduce the use of nonrenewable resources,
encourage energy-efficient construction and rehabilitation and
the use of renewable energy resources, minimize the impact of
development on the environment, and improve indoor air quality.
(2) HUD.--The term ``HUD'' means the Department of Housing
and Urban Development.
(3) HUD assistance.--The term ``HUD assistance'' means
financial assistance that is awarded, competitively or
noncompetitively, allocated by formula, or provided by HUD
through loan insurance or guarantee.
(4) Nonresidential structure.--The term ``nonresidential
structures'' means only nonresidential structures that are
appurtenant to single-family or multifamily housing residential
structures, or those that are funded by the Secretary of
Housing and Urban Development through the HUD Community
Development Block Grant program.
(5) Secretary.--The term ``Secretary'', unless otherwise
specified, means the Secretary of Housing and Urban
Development.
SEC. 283. IMPLEMENTATION OF ENERGY EFFICIENCY PARTICIPATION INCENTIVES
FOR HUD PROGRAMS.
(a) In General.--Not later than 180 days after the date of the
enactment of this Act, the Secretary shall issue such regulations as
may be necessary to establish annual energy efficiency participation
incentives to encourage participants in programs administered by the
Secretary, including recipients under programs for which HUD assistance
is provided, to achieve substantial improvements in energy efficiency.
(b) Requirement for Appropriation of Funds.--The requirement under
subsection (a) for the Secretary to provide annual energy efficiency
participation incentives pursuant to the provisions of this subtitle
shall be subject to the annual appropriation of necessary funds.
SEC. 284. BASIC HUD ENERGY EFFICIENCY STANDARDS AND STANDARDS FOR
ADDITIONAL CREDIT.
(a) Basic HUD Standard.--
(1) Residential structures.--A residential single-family or
multifamily structure shall be considered to comply with the
energy efficiency standards under this subsection if--
(A) the structure complies with an energy
efficiency building code that has been certified as in
compliance with section 304 of the Energy Conservation
and Production Act (42 U.S.C. 6833) as amended by
section 201 of this Act, or a national energy
efficiency building code adopted pursuant to that
section;
(B) the structure complies with the applicable
provisions of the American Society of Heating,
Refrigerating, and Air-Conditioning Engineers Standard
90.1-2007, as such standard or successor standard is in
effect for purposes of this section pursuant subsection
(c);
(C) the structure complies with the applicable
provisions of the 2009 International Energy
Conservation Code, as such standard or successor
standard is in effect for purposes of this section
pursuant subsection (c);
(D) in the case only of an existing structure,
where determined cost effective, the structure has
undergone rehabilitation or improvements, completed
after the date of the enactment of this Act, and the
energy consumption for the structure has been reduced
by at least 20 percent from the previous level of
consumption, as determined in accordance with energy
audits performed both before and after any
rehabilitation or improvements undertaken to reduce
such consumption; or
(E) the structure complies with the applicable
provisions of such other energy efficiency
requirements, standards, checklists, or ratings systems
as the Secretary may adopt and apply by regulation, as
may be necessary, for purposes of this section for
specific types of residential single-family or
multifamily structures or otherwise, except that the
Secretary shall make a determination regarding whether
to adopt and apply any such requirements, standards,
checklists, or rating system for purposes of this
section not later than the expiration of the 180-day
period beginning upon the date of receipt of any
written request, made in such form as the Secretary
shall provide, for such adoption and application.
In addition to compliance with any of subparagraphs (A) through
(E), the Secretary shall by regulation require, for any newly
constructed residential single-family or multifamily structure
to be considered to comply with the energy efficiency standards
under this subsection, that the structure have appropriate
electrical outlets with the facility and capacity to recharge a
standard electric passenger vehicle, including an electric
hybrid vehicle, where such vehicle would normally be parked.
(2) Nonresidential structures.--For purposes of this
section, the Secretary shall identify and adopt by regulation,
as may be necessary, energy efficiency requirements, standards,
checklists, or rating systems applicable to nonresidential
structures that are constructed or rehabilitated with HUD
assistance. A nonresidential structure shall be considered to
comply with the energy efficiency standards under this
subsection if the structure complies with the applicable
provisions of any such energy efficiency requirements,
standards, checklist, or rating systems identified and adopted
by the Secretary pursuant to this paragraph, as such standards
are in effect for purposes of this section pursuant to
subsection (c).
(3) Effect.--Nothing in this subsection may be construed to
require any structure to comply with any standard established
or adopted pursuant to this subsection, or identified in this
subsection, or to provide any benefit or credit under any
Federal program for any structure that complies with any such
standard, except to the extent that--
(A) any provision of law other than this subsection
provides a benefit or credit under a Federal program
for compliance with a standard established or adopted
pursuant to this subsection, or identified in this
subsection; or
(B) the Secretary specifically provides pursuant to
subsection (c) for the applicability of such standard.
(b) Enhanced Energy Efficiency Standards for Purposes of Providing
Additional Credit Under Certain Federally Assisted Housing Programs.--
(1) Purpose and effect.--
(A) Purpose.--The purpose of this subsection is to
establish energy efficiency and conservation standards
and green building standards that--
(i) provide for greater energy efficiency
and conservation in structures than is required
for compliance with the energy efficiency
standards under subsection (a) and then in
effect;
(ii) provide for green and sustainable
building standards not required by such
standards; and
(iii) can be used in connection with
Federal housing, housing finance, and
development programs to provide incentives for
greater energy efficiency and conservation and
for green and sustainable building methods,
elements, practices, and materials.
(B) Effect.--Nothing in this subsection may be
construed to require any structure to comply with any
standard established pursuant to this subsection or to
provide any benefit or credit under any Federal program
for any structure, except to the extent that any
provision of law other than this subsection provides a
benefit or credit under a Federal program for
compliance with a standard established pursuant to this
subsection.
(2) Compliance.--A residential or nonresidential structure
shall be considered to comply with the enhanced energy
efficiency and conservation standards or the green building
standards under this subsection, to the extent that such
structure complies with the applicable provisions of the
standards under paragraph (3) or (4), respectively (as such
standards are in effect for purposes of this section, pursuant
to paragraph (7)), in a manner that is not required for
compliance with the energy efficiency standards under
subsection (a) then in effect and subject to the Secretary's
determination of which standards are applicable to which
structures.
(3) Energy efficiency and conservation standards.--The
energy efficiency and conservation standards under this
paragraph are as follows:
(A) Residential structures.--With respect to
residential structures:
(i) New construction.--For new
construction, the Energy Star standards
established by the Environmental Protection
Agency, as such standards are in effect for
purposes of this subsection pursuant to
paragraph (7);
(ii) Existing structures.--For existing
structures, a reduction in energy consumption
from the previous level of consumption for the
structure, as determined in accordance with
energy audits performed both before and after
any rehabilitation or improvements undertaken
to reduce such consumption, that exceeds the
reduction necessary for compliance with the
energy efficiency standards under subsection
(a) then in effect and applicable to existing
structures.
(B) Nonresidential structures.--With respect to
nonresidential structures, such energy efficiency and
conservation requirements, standards, checklists, or
rating systems for nonresidential structures as the
Secretary shall identify and adopt by regulation, as
may be necessary, for purposes of this paragraph.
(4) Green building standards.--The green building standards
under this paragraph are as follows:
(A) The national Green Communities criteria
checklist for residential construction that provides
criteria for the design, development, and operation of
affordable housing, as such checklist or successor
checklist is in effect for purposes of this section
pursuant to paragraph (7).
(B) The gold certification level for the LEED for
New Construction rating system, the LEED for Homes
rating system, the LEED for Core and Shell rating
system, as applicable, as such systems or successor
systems are in effect for purposes of this section
pursuant to paragraph (7).
(C) The Green Globes assessment and rating system
of the Green Buildings Initiative.
(D) For manufactured housing, energy star rating
with respect to fixtures, appliances, and equipment in
such housing, as such standard or successor standard is
in effect for purposes of this section pursuant to
paragraph (7).
(E) The National Green Building Standard.
(F) Any other requirements, standards, checklists,
or rating systems for green building or sustainability
as the Secretary may identify and adopt by regulation,
as may be necessary for purposes of this paragraph,
except that the Secretary shall make a determination
regarding whether to adopt and apply any such
requirements, standards, checklist, or rating system
for purposes of this section not later than the
expiration of the 180-day period beginning upon date of
receipt of any written request, made in such form as
the Secretary shall provide, for such adoption and
application.
(5) Green building.--For purposes of this subsection, the
term ``green building'' means, with respect to standards for
structures, standards to require use of sustainable design
principles to reduce the use of nonrenewable resources,
minimize the impact of development on the environment, and to
improve indoor air quality.
(6) Energy audits.--The Secretary shall establish standards
and requirements for energy audits for purposes of paragraph
(3)(A)(ii) and, in establishing such standards, may consult
with any advisory committees established pursuant to section
285(c)(2) of this subtitle.
(7) Applicability and updating of standards.--
(A) Applicability.--Except as provided in
subparagraph (B), the requirements, standards,
checklists, and rating systems referred to in this
subsection that are in effect for purposes of this
subsection are such requirements, standards,
checklists, and systems are as in existence upon the
date of the enactment of this Act.
(B) Updating.--For purposes of this section, the
Secretary may adopt and apply by regulation, as may be
necessary, future amendments and supplements to, and
editions of, the requirements, standards, checklists,
and rating systems referred to in this subsection,
including applicable energy efficiency building codes
that are certified as in compliance with section 304 of
the Energy Conservation and Production Act (42 U.S.C.
6833) as amended by section 201 of this Act, or
national energy efficiency building codes adopted
pursuant to that section.
(c) Authority of Secretary To Apply Standards to Federally Assisted
Housing and Programs.--
(1) HUD housing and programs.--The Secretary of Housing and
Urban Development may, by regulation, provide for the
applicability of the energy efficiency standards under
subsection (a) or the enhanced energy efficiency and
conservation standards and green building standards under
subsection (b), or both, with respect to any covered federally
assisted housing described in paragraph (3)(A) or any HUD
assistance, subject to minimum Federal codes or standards then
in effect.
(2) Rural housing.--The Secretary of Agriculture may, by
regulation, provide for the applicability of the energy
efficiency standards under subsection (a) or the enhanced
energy efficiency and conservation standards and green building
standards under subsection (b), or both, with respect to any
covered federally assisted housing described in paragraph
(3)(B) or any assistance provided with respect to rural housing
by the Rural Housing Service of the Department of Agriculture,
subject to minimum Federal codes or standards then in effect.
(3) Covered federally assisted housing.--For purposes of
this subsection, the term ``covered federally assisted
housing'' means--
(A) any residential or nonresidential structure for
which any HUD assistance is provided; and
(B) any new construction of single-family housing
(other than manufactured homes) subject to mortgages
insured, guaranteed, or made by the Secretary of
Agriculture under title V of the Housing Act of 1949
(42 U.S.C. 1471 et seq.).
SEC. 285. ENERGY EFFICIENCY AND CONSERVATION DEMONSTRATION PROGRAM FOR
MULTIFAMILY HOUSING PROJECTS ASSISTED WITH PROJECT-BASED
RENTAL ASSISTANCE.
(a) Authority.--For multifamily housing projects for which project-
based rental assistance is provided under a covered multifamily
assistance program, the Secretary shall, subject to the availability of
amounts provided in advance in appropriation Acts, carry out a program
to demonstrate the effectiveness of funding a portion of the costs of
meeting the enhanced energy efficiency standards under section 284(b).
At the discretion of the Secretary, the demonstration program may
include incentives for housing that is assisted with Indian housing
block grants provided pursuant to the Native American Housing
Assistance and Self-Determination Act of 1996, but only to the extent
that such inclusion does not violate such Act, its regulations, and the
goal of such Act of tribal self-determination.
(b) Goals.--The demonstration program under this section shall be
carried out in a manner that--
(1) protects the financial interests of the Federal
Government;
(2) reduces the proportion of funds provided by the Federal
Government and by owners and residents of multifamily housing
projects that are used for costs of utilities for the projects;
(3) encourages energy efficiency and conservation by owners
and residents of multifamily housing projects and installation
of renewable energy improvements, such as improvements
providing for use of solar, wind, geothermal, or biomass energy
sources;
(4) creates incentives for project owners to carry out such
energy efficiency renovations and improvements by allowing a
portion of the savings in operating costs resulting from such
renovations and improvements to be retained by the project
owner, notwithstanding otherwise applicable limitations on
dividends;
(5) promotes the installation, in existing residential
buildings, of energy-efficient and cost-effective improvements
and renewable energy improvements, such as improvements
providing for use of solar, wind, geothermal, or biomass energy
sources;
(6) tests the efficacy of a variety of energy efficiency
measures for multifamily housing projects of various sizes and
in various geographic locations;
(7) tests methods for addressing the various, and often
competing, incentives that impede owners and residents of
multifamily housing projects from working together to achieve
energy efficiency or conservation; and
(8) creates a database of energy efficiency and
conservation, and renewable energy, techniques, energy-savings
management practices, and energy efficiency and conservation
financing vehicles.
(c) Approaches.--In carrying out the demonstration program under
this section, the Secretary may--
(1) enter into agreements with the Building America Program
of the Department of Energy and other consensus committees
under which such programs, partnerships, or committees assume
some or all of the functions, obligations, and benefits of the
Secretary with respect to energy savings;
(2) establish advisory committees to advise the Secretary
and any such third-party partners on technological and other
developments in the area of energy efficiency and the creation
of an energy efficiency and conservation credit facility and
other financing opportunities, which committees shall include
representatives of homebuilders, realtors, architects,
nonprofit housing organizations, environmental protection
organizations, renewable energy organizations, and advocacy
organizations for the elderly and persons with disabilities;
any advisory committees established pursuant to this paragraph
shall not be subject to the Federal Advisory Committee Act (5
U.S.C. App.);
(3) approve, for a period not to exceed 10 years,
additional adjustments in the maximum monthly rents or
additional project rental assistance, or additional Indian
housing block grant funds under the Native American Housing
Assistance and Self-Determination Act of 1996, as applicable,
for dwelling units in multifamily housing projects that are
provided project-based rental assistance under a covered
multifamily assistance program, in such amounts as may be
necessary to amortize a portion of the cost of energy
efficiency and conservation measures for such projects;
(4) develop a competitive process for the award of such
additional assistance for multifamily housing projects seeking
to implement energy efficiency, renewable energy sources, or
conservation measures; and
(5) waive or modify any existing statutory or regulatory
provision that would otherwise impair the implementation or
effectiveness of the demonstration program under this section,
including provisions relating to methods for rent adjustments,
comparability standards, maximum rent schedules, and utility
allowances; notwithstanding the preceding provisions of this
paragraph, the Secretary may not waive any statutory
requirement relating to fair housing, nondiscrimination, labor
standards, or the environment, except pursuant to existing
authority to waive nonstatutory environmental and other
applicable requirements.
(d) Requirement.--During the 4-year period beginning 12 months
after the date of the enactment of this Act, the Secretary shall carry
out demonstration programs under this section with respect to not fewer
than 50,000 dwelling units.
(e) Selection.--
(1) Scope.--In order to provide a broad and representative
profile for use in designing a program which can become
operational and effective nationwide, the Secretary shall carry
out the demonstration program under this section with respect
to dwelling units located in a wide variety of geographic areas
and project types assisted by the various covered multifamily
assistance programs and using a variety of energy efficiency
and conservation and funding techniques to reflect differences
in climate, types of dwelling units and technical and
scientific methodologies, and financing options. The Secretary
shall ensure that the geographic areas included in the
demonstration program include dwelling units on Indian lands
(as such term is defined in section 2601 of the Energy Policy
Act of 1992 (25 U.S.C. 3501), to the extent that dwelling units
on Indian land have the type of residential structures that are
the focus of the demonstration program.
(2) Priority.--The Secretary shall provide priority for
selection for participation in the program under this section
based on the extent to which, as a result of assistance
provided, the project will comply with the energy efficiency
standards under subsection (a), (b), or (c) of section 284 of
this subtitle.
(f) Use of Existing Partnerships.--To the extent feasible, the
Secretary shall--
(1) utilize the Partnership for Advancing Technology in
Housing of the Department of Housing and Urban Development to
assist in carrying out the requirements of this section and to
provide education and outreach regarding the demonstration
program authorized under this section; and
(2) consult with the Secretary of Energy, the Administrator
of the Environmental Protection Agency, and the Secretary of
the Army regarding utilizing the Building America Program of
the Department of Energy, the Energy Star Program, and the Army
Corps of Engineers, respectively, to determine the manner in
which they might assist in carrying out the goals of this
section and providing education and outreach regarding the
demonstration program authorized under this section.
(g) Limitation.--No amounts made available under the American
Recovery and Reinvestment Act of 2009 (Public Law 111-5) may be used to
carry out the demonstration program under this section.
(h) Reports.--
(1) Annual.--Not later than the expiration of the 2-year
beginning upon the date of the enactment of this Act, and for
each year thereafter during the term of the demonstration
program, the Secretary shall submit a report to the Congress
annually that describes and assesses the demonstration program
under this section.
(2) Final.--Not later than 6 months after the expiration of
the 4-year period described in subsection (d), the Secretary
shall submit a final report to the Congress assessing the
demonstration program, which--
(A) shall assess the potential for expanding the
demonstration program on a nationwide basis; and
(B) shall include descriptions of--
(i) the size of each multifamily housing
project for which assistance was provided under
the program;
(ii) the geographic location of each
project assisted, by State and region;
(iii) the criteria used to select the
projects for which assistance is provided under
the program;
(iv) the energy efficiency and conservation
measures and financing sources used for each
project that is assisted under the program;
(v) the difference, before and during
participation in the demonstration program, in
the amount of the monthly assistance payments
under the covered multifamily assistance
program for each project assisted under the
program;
(vi) the average length of the term of the
such assistance provided under the program for
a project;
(vii) the aggregate amount of savings
generated by the demonstration program and the
amount of savings expected to be generated by
the program over time on a per-unit and
aggregate program basis;
(viii) the functions performed in
connection with the implementation of the
demonstration program that were transferred or
contracted out to any third parties;
(ix) an evaluation of the overall successes
and failures of the demonstration program; and
(x) recommendations for any actions to be
taken as a result of the such successes and
failures.
(3) Contents.--Each annual report pursuant to paragraph (1)
and the final report pursuant to paragraph (2) shall include--
(A) a description of the status of each multifamily
housing project selected for participation in the
demonstration program under this section; and
(B) findings from the program and recommendations
for any legislative actions.
(i) Covered Multifamily Assistance Program.--For purposes of this
section, the term ``covered multifamily assistance program'' means--
(1) the program under section 8 of the United States
Housing Act of 1937 (42 U.S.C. 1437f) for project-based rental
assistance;
(2) the program under section 202 of the Housing Act of
1959 (12 U.S.C. 1701q) for assistance for supportive housing
for the elderly;
(3) the program under section 811 of the Cranston-Gonzalez
National Affordable Housing Act (42 U.S.C. 8013) for supportive
housing for persons with disabilities;
(4) the program under section 236 of the National Housing
Act (12 U.S.C. 1715z-1 for assistance for rental housing
projects;
(5) the program under section 515 of the Housing Act of
1949 (42 U.S.C. 1485) for rural rental housing; and
(6) the program for assistance under the Native American
Housing Assistance and Self-Determination Act of 1996 (25
U.S.C. 4111).
(j) Authorization of Appropriations.--There is authorized to be
appropriated to carry out this section, including providing rent
adjustments, additional project rental assistance, and incentives,
$50,000,000 for each fiscal year in which the demonstration program
under this section is carried out.
(k) Regulations.--Not later than the expiration of the 180-day
period beginning on the date of the enactment of this Act, the
Secretary shall issue any regulations necessary to carry out this
section.
SEC. 286. ADDITIONAL CREDIT FOR FANNIE MAE AND FREDDIE MAC HOUSING
GOALS FOR ENERGY-EFFICIENT AND LOCATION-EFFICIENT
MORTGAGES.
Section 1336(a) of the Housing and Community Development Act of
1992 (12 U.S.C. 4566(a)), as amended by the Federal Housing Finance
Regulatory Reform Act of 2008 (Public Law 110-289; 122 Stat. 2654), is
amended--
(1) in paragraph (2), by striking ``paragraph (5)'' and
inserting ``paragraphs (5) and (6)''; and
(2) by adding at the end the following new paragraph:
``(6) Additional credit.--
``(A) In general.--In assigning credit toward
achievement under this section of the housing goals for
mortgage purchase activities of the enterprises, the
Director shall assign--
``(i) more than 125 percent credit, for any
such purchase that both--
``(I) complies with the
requirements of such goals; and
``(II)(aa) supports housing that
meets the energy efficiency standards
under section 284(a) of the Green
Resources for Energy Efficient
Neighborhoods Act of 2009; or
``(bb) is a location-efficient
mortgage, as such term is defined in
section 1335(e); and
``(ii) credit in addition to credit under
clause (i), for any such purchase that both--
``(I) complies with the
requirements of such goals, and
``(II) supports housing that
complies with the enhanced energy
efficiency and conservation standards,
or the green building standards, under
section 284(b) of such Act, or both,
and such additional credit shall be given based
on the extent to which the housing supported
with such purchases complies with such
standards.
``(B) Treatment of additional credit.--The
availability of additional credit under this paragraph
shall not be used to increase any housing goal,
subgoal, or target established under this subpart.''.
SEC. 287. DUTY TO SERVE UNDERSERVED MARKETS FOR ENERGY-EFFICIENT AND
LOCATION-EFFICIENT MORTGAGES.
Section 1335 of Federal Housing Enterprises Financial Safety and
Soundness Act of 1992 (12 U.S.C. 4565), as amended by the Federal
Housing Finance Regulatory Reform Act of 2008 (Public Law 110-289; 122
Stat. 2654), is amended--
(1) in subsection (a)(1), by adding at the end the
following new subparagraph:
``(D) Markets for energy-efficient and location-
efficient mortgages.--
``(i) Duty.--Subject to clause (ii), the
enterprise shall develop loan products and
flexible underwriting guidelines to facilitate
a secondary market for energy-efficient and
location-efficient mortgages on housing for
very low-, low-, and moderate-income families,
and for second and junior mortgages made for
purposes of energy efficiency or renewable
energy improvements, or both.
``(ii) Authority to suspend.--
Notwithstanding any other provision of this
section, the Director may suspend the
applicability of the requirement under clause
(i) with respect to an enterprise, for such
period as is necessary, if the Director
determines that exigent circumstances exist and
such suspension is appropriate to ensure the
safety and soundness of the portfolio holdings
of the enterprise.'';
(2) by adding at the end the following new subsection:
``(e) Definitions.--For purposes of this section, the following
definitions shall apply:
``(1) Energy-efficient mortgage.--The term `energy-
efficient mortgage' means a mortgage loan under which the
income of the borrower, for purposes of qualification for such
loan, is considered to be increased by not less than $1 for
each $1 of savings projected to be realized by the borrower as
a result of cost-effective energy-saving design, construction
or improvements (including use of renewable energy sources,
such as solar, geothermal, biomass, and wind, super-insulation,
energy-saving windows, insulating glass and film, and radiant
barrier) for the home for which the loan is made.
``(2) Location-efficient mortgage.--The term `location-
efficient mortgage' means a mortgage loan under which--
``(A) the income of the borrower, for purposes of
qualification for such loan, is considered to be
increased by not less than $1 for each $1 of savings
projected to be realized by the borrower because the
location of the home for which loan is made will result
in decreased transportation costs for the household of
the borrower; or
``(B) the sum of the principal, interest, taxes,
and insurance due under the mortgage loan is decreased
by not less than $1 for each $1 of savings projected to
be realized by the borrower because the location of the
home for which loan is made will result in decreased
transportation costs for the household of the
borrower.''.
SEC. 288. CONSIDERATION OF ENERGY EFFICIENCY UNDER FHA MORTGAGE
INSURANCE PROGRAMS AND NATIVE AMERICAN AND NATIVE
HAWAIIAN LOAN GUARANTEE PROGRAMS.
(a) FHA Mortgage Insurance.--
(1) Requirement.--Title V of the National Housing Act is
amended by adding after section 542 (12 U.S.C. 1735f-20) the
following new section:
``SEC. 543. CONSIDERATION OF ENERGY EFFICIENCY.
``(a) Underwriting Standards.--The Secretary shall establish a
method to consider, in its underwriting standards for mortgages on
single-family housing meeting the energy efficiency standards under
section 284(a) of the Green Resources for Energy Efficient
Neighborhoods Act of 2009 that are insured under this Act, the impact
that savings on utility costs has on the income of the mortgagor.
``(b) Goal.--It is the sense of the Congress that, in carrying out
this Act, the Secretary should endeavor to insure mortgages on single-
family housing meeting the energy efficiency standards under section
284(a) of the Green Resources for Energy Efficient Neighborhoods Act of
2009 such that at least 50,000 such mortgages are insured during the
period beginning upon the date of the enactment of such Act and ending
on December 31, 2012.''.
(2) Reporting on defaults.--Section 540(b) of the National
Housing Act (12 U.S.C. 1735f-18(b)) is amended by adding at the
end the following new paragraph:
``(3) With respect to each collection period that commences
after December 31, 2011, the total number of mortgages on
single-family housing meeting the energy efficiency standards
under section 284(a) of the Green Resources for Energy
Efficient Neighborhoods Act of 2009 that are insured by the
Secretary during the applicable collection period, the number
of defaults and foreclosures occurring on such mortgages during
such period, the percentage of the total of such mortgages
insured during such period on which defaults and foreclosure
occurred, and the rate for such period of defaults and
foreclosures on such mortgages compared to the overall rate for
such period of defaults and foreclosures on mortgages for
single-family housing insured under this Act by the
Secretary.''.
(b) Indian Housing Loan Guarantees.--
(1) Requirement.--Section 184 of the Housing and Community
Development Act of 1992 (12 U.S.C. 1715z-13a) is amended--
(A) by redesignating subsection (l) as subsection
(m); and
(B) by inserting after subsection (k) the following
new subsection:
``(l) Consideration of Energy Efficiency.--The Secretary shall
establish a method to consider, in its underwriting standards for loans
for single-family housing meeting the energy efficiency standards under
section 284(a) of the Green Resources for Energy Efficient
Neighborhoods Act of 2009 that are guaranteed under this section, the
impact that savings on utility costs has on the income of the
borrower.''.
(2) Reporting on defaults.--Section 540(b) of the National
Housing Act (12 U.S.C. 1735f-18(b)), as amended by subsection
(a)(2) of this section, is further amended by adding at the end
the following new paragraph:
``(4) With respect to each collection period that commences
after December 31, 2011, the total number of loans guaranteed
under section 184 of the Housing and Community Development Act
of 1992 (12 U.S.C. 1715z-13a) on single-family housing meeting
the energy efficiency standards under section 284(a) of the
Green Resources for Energy Efficient Neighborhoods Act of 2009
that are guaranteed by the Secretary during the applicable
collection period, the number of defaults and foreclosures
occurring on such loans during such period, the percentage of
the total of such loans guaranteed during such period on which
defaults and foreclosure occurred, and the rate for such period
of defaults and foreclosures on such loans compared to the
overall rate for such period of defaults and foreclosures on
loans for single-family housing guaranteed under such section
184 by the Secretary.''.
(c) Native Hawaiian Housing Loan Guarantees.--
(1) Requirement.--Section 184A of the Housing and Community
Development Act of 1992 (12 U.S.C. 1715z-13b) is amended by
inserting after subsection (l) the following new subsection:
``(m) Energy-efficient Housing Requirement.--The Secretary shall
establish a method to consider, in its underwriting standards for loans
for single-family housing meeting the energy efficiency standards under
section 284(a) of the Green Resources for Energy Efficient
Neighborhoods Act of 2009 that are guaranteed under this section, the
impact that savings on utility costs has on the income of the
borrower.''.
(2) Reporting on defaults.--Section 540(b) of the National
Housing Act (12 U.S.C. 1735f-18(b)), as amended by the
preceding provisions of this section, is further amended by
adding at the end the following new paragraph:
``(5) With respect to each collection period that commences
after December 31, 2011, the total number of loans guaranteed
under section 184A of the Housing and Community Development Act
of 1992 (12 U.S.C. 1715z-13b) on single-family housing meeting
the energy efficiency standards under section 284(a) of the
Green Resources for Energy Efficient Neighborhoods Act of 2009
that are guaranteed by the Secretary during the applicable
collection period, the number of defaults and foreclosures
occurring on such loans during such period, the percentage of
the total of such loans guaranteed during such period on which
defaults and foreclosure occurred, and the rate for such period
of defaults and foreclosures on such loans compared to the
overall rate for such period of defaults and foreclosures on
loans for single-family housing guaranteed under such section
184A by the Secretary.''.
SEC. 289. ENERGY-EFFICIENT MORTGAGES AND LOCATION-EFFICIENT MORTGAGES
EDUCATION AND OUTREACH CAMPAIGN.
Section 106 of the Energy Policy Act of 1992 (12 U.S.C. 1701z-16)
is amended by adding at the end the following new subsection:
``(g) Education and Outreach Campaign.--
``(1) Development of energy- and location-efficient
mortgages outreach program.--
``(A) Commission.--The Secretary, in consultation
and coordination with the Secretary of Energy, the
Secretary of Education, the Secretary of Agriculture,
and the Administrator of the Environmental Protection
Agency, shall establish a commission to develop and
recommend model mortgage products and underwriting
guidelines that provide market-based incentives to
prospective home buyers, lenders, and sellers to
incorporate energy efficiency upgrades and location
efficiencies in new mortgage loan transactions.
``(B) Report.--Not later than 24 months after the
date of the enactment of this Act, the Secretary shall
provide a written report to the Congress on the results
of work of the commission established pursuant to
subparagraph (A) and that identifies model mortgage
products and underwriting guidelines that may encourage
energy and location efficiency.
``(2) Implementation.--After submission of the report under
paragraph (1)(B), the Secretary, in consultation and
coordination with the Secretary of Energy, the Secretary of
Education, and the Administrator of the Environmental
Protection Agency, shall carry out a public awareness,
education, and outreach campaign based on the findings of the
commission established pursuant to paragraph (1) to inform and
educate residential lenders and prospective borrowers regarding
the availability, benefits, advantages, and terms of energy-
efficient mortgages and location-efficient mortgages made
available pursuant to this section, energy-efficient and
location-efficient mortgages that meet the requirements of
section 1335 of the Housing and Community Development Act of
1992 (42 U.S.C. 4565), and other mortgages, including mortgages
for multifamily housing, that have energy improvement features
or location efficiency features and to publicize such
availability, benefits, advantages, and terms. Such actions may
include entering into a contract with an appropriate entity to
publicize and market such mortgages through appropriate media.
``(3) Renewable energy home product expos.--The Congress
hereby encourages the Secretary of Housing and Urban
Development to work with appropriate entities to organize and
hold renewable energy expositions that provide an opportunity
for the public to view and learn about renewable energy
products for the home that are currently on the market.
``(4) Authorization of appropriations.--There is authorized
to be appropriated to the Secretary to carry out this
subsection $5,000,000 for each of fiscal years 2010 through
2014.''.
SEC. 290. COLLECTION OF INFORMATION ON ENERGY-EFFICIENT AND LOCATION-
EFFICIENT MORTGAGES THROUGH HOME MORTGAGE DISCLOSURE ACT.
(a) In General.--Section 304(b) of the Home Mortgage Disclosure Act
of 1975 (12 U.S.C. 2803(b)) is amended--
(1) in paragraph (3), by striking ``and'' at the end;
(2) in paragraph (4), by striking the period at the end and
inserting a semicolon; and
(3) by adding at the end the following new paragraphs:
``(5) the number and dollar amount of mortgage loans for
single-family housing and for multifamily housing that are
energy-efficient mortgages (as such term is defined in section
1335 of Housing and Community Development Act of 1992); and
``(6) the number and dollar amount of mortgage loans for
single-family housing and for multifamily housing that are
location-efficient mortgages (as such term is defined in
section 1335 of Housing and Community Development Act of
1992).''.
(b) Applicability.--The amendment made by subsection (a) shall
apply with respect to the first calendar year that begins after the
expiration of the 30-day period beginning on the date of the enactment
of this Act.
SEC. 291. ENSURING AVAILABILITY OF HOMEOWNERS INSURANCE FOR HOMES NOT
CONNECTED TO ELECTRICITY GRID.
(a) Congressional Intent.--The Congress intends that--
(1) consumers shall not be denied homeowners insurance for
a dwelling (as such term is defined in subsection (c)) based
solely on the fact that the dwelling is not connected to or
able to receive electricity service from any wholesale or
retail electric power provider;
(2) States should ensure that consumers are able to obtain
homeowners insurance for such dwellings;
(3) States should support insurers that develop voluntary
incentives to provide such insurance; and
(4) States may not prohibit insurers from offering a
homeowners insurance product specifically designed for such
dwellings.
(b) Insuring Homes and Related Property in Indian Areas.--
Notwithstanding any other provision of law, dwellings located in Indian
areas (as such term is defined in section 4 of the Native American
Housing Assistance and Self-Determination Act of 1996 (25 U.S.C. 4103))
and constructed or maintained using assistance, loan guarantees, or
other authority under the Native American Housing Assistance and Self-
Determination Act of 1996 may be insured by any tribally owned self-
insurance risk pool approved by the Secretary of Housing and Urban
Development.
(c) Dwelling.--For purposes of this section, the term ``dwelling''
means a residential structure that--
(1) consists of one to four dwelling units;
(2) is provided electricity from renewable energy sources;
and
(3) is not connected to any wholesale or retail electrical
power grid.
SEC. 292. MORTGAGE INCENTIVES FOR ENERGY-EFFICIENT MULTIFAMILY HOUSING.
(a) In General.--The Secretary of Housing and Urban Development
shall establish incentives for increasing the energy efficiency of
multifamily housing that is subject to a mortgage to be insured under
title II of the National Housing Act (12 U.S.C. 1707 et seq.) so that
the housing meets the energy efficiency standards under section 284(a)
of this subtitle and incentives to encourage compliance of such housing
with the energy efficiency and conservation standards, and the green
building standards, under section 284(b) of this subtitle, to the
extent that such incentives are based on the impact that savings on
utility costs has on the operating costs of the housing, as determined
by the Secretary.
(b) Incentives.--Such incentives may include, for any such
multifamily housing that complies with the energy efficiency standards
under section 284(a)--
(1) providing a discount on the chargeable premiums for the
mortgage insurance for such housing from the amount otherwise
chargeable for such mortgage insurance;
(2) allowing mortgages to exceed the dollar amount limits
otherwise applicable under law to the extent such additional
amounts are used to finance improvements or measures designed
to meet the standards referred to in subsection (a); and
(3) reducing the amount that the owner of such multifamily
housing meeting the standards referred to in subsection (a) is
required to contribute.
SEC. 293. ENERGY-EFFICIENT CERTIFICATIONS FOR MANUFACTURED HOUSING WITH
MORTGAGES.
Section 526 of the National Housing Act (12 U.S.C. 1735f-4(a)) is
amended--
(1) in subsection (a)--
(A) by striking ``, other than manufactured
homes,'' each place such term appears;
(B) by inserting after the period at the end the
following: ``The energy performance requirements
developed and established by the Secretary under this
section for manufactured homes shall require energy
star rating for wall fixtures, appliances, and
equipment in such housing.'';
(C) by inserting ``(1)'' after ``(a)''; and
(D) by adding at the end the following new
paragraphs:
``(2) The Secretary shall require, with respect to any single- or
multi-family residential housing subject to a mortgage insured under
this Act, that any approval or certification of the housing for meeting
any energy efficiency or conservation criteria, standards, or
requirements pursuant to this title and any approval or certification
required pursuant to this title with respect to energy-conserving
improvements or any renewable energy sources, such as wind, solar
energy geothermal, or biomass, shall be conducted only by an individual
certified by a home energy rating system provider who has been
accredited to conduct such ratings by the Home Energy Ratings System
Council, the Residential Energy Services Network, or such other
appropriate national organization, as the Secretary may provide, or by
licensed professional architect or engineer. If any organization makes
a request to the Secretary for approval to accredit individuals to
conduct energy efficiency or conservation ratings, the Secretary shall
review and approve or disapprove such request not later than the
expiration of the 6-month period beginning upon receipt of such
request.
``(3) The Secretary shall periodically examine the method used to
conduct inspections for compliance with the requirements under this
section, analyze various other approaches for conducting such
inspections, and review the costs and benefits of the current method
compared with other methods.''; and
(2) in subsection (b), by striking ``, other than a
manufactured home,''.
SEC. 294. ASSISTED HOUSING ENERGY LOAN PILOT PROGRAM.
(a) Authority.--Not later than the expiration of the 12-month
period beginning on the date of the enactment of this Act, the
Secretary shall develop and implement a pilot program under this
section to facilitate the financing of cost-effective capital
improvements for covered assisted housing projects to improve the
energy efficiency and conservation of such projects.
(b) Loans.--The pilot program under this section shall involve not
less than three and not more than five lenders, and shall provide for a
privately financed loan to be made for a covered assisted housing
project, which shall--
(1) finance capital improvements for the project that meet
such requirements as the Secretary shall establish, and may
involve contracts with third parties to perform such capital
improvements, including the design of such improvements by
licensed professional architects or engineers;
(2) have a term to maturity of not more than 20 years,
which shall be based upon the duration necessary to realize
cost savings sufficient to repay the loan;
(3) be secured by a mortgage subordinate to the mortgage
for the project that is insured under the National Housing Act;
and
(4) provide for a reduction in the remaining principal
obligation under the loan based on the actual resulting cost
savings realized from the capital improvements financed with
the loan.
(c) Underwriting Standards.--The Secretary shall establish
underwriting requirements for loans made under the pilot program under
this section, which shall--
(1) require the cost savings projected to be realized from
the capital improvements financed with the loan, during the
term of the loan, to exceed the costs of repaying the loan;
(2) allow the designer or contractor involved in designing
capital improvements to be financed with a loan under the
program to carry out such capital improvements; and
(3) include such energy, audit, property, financial,
ownership, and approval requirements as the Secretary considers
appropriate.
(d) Treatment of Savings.--The pilot program under this section
shall provide that the project owner shall receive the full financial
benefit from any reduction in the cost of utilities resulting from
capital improvements financed with a loan made under the program.
(e) Covered Assisted Housing Projects.--For purposes of this
section, the term ``covered assisted housing project'' means a housing
project that--
(1) is financed by a loan or mortgage that is--
(A) insured by the Secretary under--
(i) subsection (d)(3) of section 221 of the
National Housing Act (12 U.S.C. 1715l), and
bears interest at a rate determined under the
proviso of section 221(d)(5) of such Act; or
(ii) subsection (d)(4) of such section 221.
(B) insured or assisted under section 236 of the
National Housing Act (12 U.S.C. 1715z-1);
(2) at the time a loan under this section is made, is
provided project-based rental assistance under section 8 of the
United States Housing Act of 1937 (42 U.S.C. 1437f) for 50
percent or more of the dwelling units in the project; and
(3) is not a housing project owned or held by the
Secretary, or subject to a mortgage held by the Secretary.
SEC. 295. MAKING IT GREEN.
(a) Partnerships With Tree-planting Organizations.--The Secretary
shall establish and provide incentives for developers of housing for
which any HUD financial assistance, as determined by the Secretary, is
provided for development, maintenance, operation, or other costs, to
enter into agreements and partnerships with tree-planting
organizations, nurseries, and landscapers to certify that trees,
shrubs, grasses, and other plants are planted in the proper manner, are
provided adequate maintenance, and survive for at least 3 years after
planting or are replaced. The financial assistance determined by the
Secretary as eligible under this section shall take into consideration
such factors as cost effectiveness and affordability.
(b) Making It Green Plan.--In the case of any new or substantially
rehabilitated housing for which HUD financial assistance, as determined
in accordance with subsection (a), is provided by the Secretary for the
development, construction, maintenance, rehabilitation, improvement,
operation, or costs of the housing, including financial assistance
provided through the Community Development Block Grant program under
title I of the Housing and Community Development Act of 1974 (42 U.S.C.
5301 et seq.), the Secretary shall require the development of a plan
that provides for--
(1) in the case of new construction and improvements,
siting of such housing and improvements in a manner that
provides for energy efficiency and conservation to the extent
feasible, taking into consideration location and project type;
(2) minimization of the effects of construction,
rehabilitation, or other development on the condition of
existing trees;
(3) selection and installation of indigenous trees, shrubs,
grasses, and other plants based upon applicable design
guidelines and standards of the International Society for
Arboriculture;
(4) post-planting care and maintenance of the landscaping
relating to or affected by the housing in accordance with best
management practices; and
(5) establishment of a goal for minimum greenspace or tree
canopy cover for the housing site for which such financial
assistance is provided, including guidelines and timetables
within which to achieve compliance with such minimum
requirements.
(c) Partnerships.--In carrying out this section, the Secretary is
encouraged to consult, as appropriate, with national organizations
dedicated to providing housing assistance and related services to low-
income families, such as the Alliance for Community Trees and its
affiliates, the American Nursery and Landscape Association, the
American Society of Landscape Architects, and the National Arbor Day
Foundation.
SEC. 296. RESIDENTIAL ENERGY EFFICIENCY BLOCK GRANT PROGRAM.
Title I of the Housing and Community Development Act of 1974 (42
U.S.C. 5301 et seq.) is amended by adding at the end the following new
section:
``SEC. 123. RESIDENTIAL ENERGY EFFICIENCY BLOCK GRANT PROGRAM.
``(a) In General.--To the extent amounts are made available for
grants under this section, the Secretary shall make grants under this
section to States, metropolitan cities and urban counties, Indian
tribes, and insular areas to carry out energy efficiency improvements
in new and existing single-family and multifamily housing.
``(b) Allocations.--
``(1) In general.--Of the total amount made available for
each fiscal year for grants under this section that remains
after reserving amounts pursuant to paragraph (2), the
Secretary shall allocate for insular areas, for metropolitan
cities and urban counties, and for States, an amount that bears
the same ratio to such total amount as the amount allocated for
such fiscal year under section 106 for Indian tribes, for
insular areas, for metropolitan cities and urban counties, and
for States, respectively, bears to the total amount made
available for such fiscal year for grants under section 106.
``(2) Set aside for indian tribes.--Of the total amount
made available for each fiscal year for grants under this
section, the Secretary shall allocate not less than 1 percent
to Indian tribes.
``(c) Grant Amounts.--
``(1) Entitlement communities.--From the amounts allocated
pursuant to subsection (b) for metropolitan cities and urban
counties for each fiscal year, the Secretary shall make a grant
for such fiscal year to each metropolitan city and urban county
that complies with the requirement under subsection (d), in the
amount that bears the same ratio such total amount so allocated
as the amount of the grant for such fiscal year under section
106 for such metropolitan city or urban county bears to the
aggregate amount of all grants for such fiscal year under
section 106 for all metropolitan cities and urban counties.
``(2) States.--From the amounts allocated pursuant to
subsection (b) for States for each fiscal year, the Secretary
shall make a grant for such fiscal year to each State that
complies with the requirement under subsection (d), in the
amount that bears the same ratio such total amount so allocated
as the amount of the grant for such fiscal year under section
106 for such State bears to the aggregate amount of all grants
for such fiscal year under section 106 for all States. Grant
amounts received by a State shall be used only for eligible
activities under subsection (e) carried out in nonentitlement
areas of the State.
``(3) Indian tribes.--From the amounts allocated pursuant
to subsection (b) for Indian tribes, the Secretary shall make
grants to Indian tribes that comply with the requirement under
subsection (d) on the basis of a competition conducted pursuant
to specific criteria, as the Secretary shall establish by
regulation, for the selection of Indian tribes to receive such
amount.
``(4) Insular areas.--From the amounts allocated pursuant
to subsection (b) for insular areas, the Secretary shall make a
grant to each insular area that complies with the requirement
under subsection (d) on the basis of the ratio of the
population of the insular area to the aggregate population of
all insular areas. In determining the distribution of amounts
to insular areas, the Secretary may also include other
statistical criteria as data become available from the Bureau
of Census of the Department of Labor, but only if such criteria
are set forth by regulation issued after notice and an
opportunity for comment.
``(d) Statement of Activities.--
``(1) Requirement.--Before receipt the receipt in any
fiscal year of a grant under subsection (c) by any grantee, the
grantee shall have prepared a final statement of housing energy
efficiency objectives and projected use of funds as the
Secretary shall require and shall have provided the Secretary
with such certifications regarding such objectives and use as
the Secretary may require. In the case of metropolitan cities,
urban counties, units of general local government, and insular
areas receiving grants, the statement of projected use of funds
shall consist of proposed housing energy efficiency activities.
In the case of States receiving grants, the statement of
projected use of funds shall consist of the method by which the
States will distribute funds to units of general local
government.
``(2) Public participation.--The Secretary may establish
requirements to ensure the public availability of information
regarding projected use of grant amounts and public
participation in determining such projected use.
``(e) Eligible Activities.--
``(1) Requirement.--Amounts from a grant under this section
may be used only to carry out activities for single-family or
multifamily housing that are designed to improve the energy
efficiency of the housing so that the housing complies with the
energy efficiency standards under section 284(a) of the Green
Resources for Energy Efficient Neighborhoods Act of 2009,
including such activities to provide energy for such housing
from renewable sources, such as wind, waves, solar, biomass,
and geothermal sources.
``(2) Preference for compliance beyond basic
requirements.--In selecting activities to be funded with
amounts from a grant under this section, a grantee shall give
more preference to activities based on the extent to which the
activities will result in compliance by the housing with the
enhanced energy efficiency and conservation standards, and the
green building standards, under section 284(b) of such Act.
``(f) Reports.--Each grantee of a grant under this section for a
fiscal year shall submit to the Secretary, at a time determined by the
Secretary, a performance and evaluation report concerning the use of
grant amounts, which shall contain an assessment by the grantee of the
relationship of such use to the objectives identified in the grantees
statement under subsection (d).
``(g) Applicability of CDBG Provisions.--Sections 109, 110, and 111
of the Housing and Community Development Act of 1974 (42 U.S.C. 5309,
5310, 5311) shall apply to assistance received under this section to
the same extent and in the same manner that such sections apply to
assistance received under title I of such Act.
``(h) Authorization of Appropriations.--There is authorized to be
appropriated for grants under this section $2,500,000,000 for fiscal
year 2010 and such sums as may be necessary for each fiscal year
thereafter.''.
SEC. 297. INCLUDING SUSTAINABLE DEVELOPMENT AND TRANSPORTATION
STRATEGIES IN COMPREHENSIVE HOUSING AFFORDABILITY
STRATEGIES.
Section 105(b) of the Cranston-Gonzalez National Affordable Housing
Act (42 U.S.C. 12705(b)) is amended--
(1) by striking ``and'' at the end of paragraph (19);
(2) by striking the period at the end of paragraph (20) and
inserting ``; and'';
(3) and by inserting after paragraph (20) the following new
paragraphs:
``(21) describe the jurisdiction's strategies to encourage
sustainable development for affordable housing, including
single-family and multifamily housing, as measured by--
``(A) greater energy efficiency and use of
renewable energy sources, including any strategies
regarding compliance with the energy efficiency
standards under section 284(a) of the Green Resources
for Energy Efficient Neighborhoods Act of 2009 and with
the enhanced energy efficiency and conservation
standards, and the green building standards, under
section 284(b) of such Act;
``(B) increased conservation, recycling, and reuse
of resources;
``(C) more effective use of existing
infrastructure;
``(D) use of building materials and methods that
are healthier for residents of the housing, including
use of building materials that are free of added known
carcinogens that are classified as Group 1 Known
Carcinogens by the International Agency for Research on
Cancer; and
``(E) such other criteria as the Secretary
determines, in consultation with the Secretary of
Energy, the Secretary of Agriculture, and the
Administrator of the Environmental Protection Agency,
are in accordance with the purposes of this paragraph;
and
``(22) describe the jurisdiction's efforts to coordinate
its housing strategy with its transportation planning
strategies to ensure to the extent practicable that residents
of affordable housing have access to public transportation.''.
SEC. 298. GRANT PROGRAM TO INCREASE SUSTAINABLE LOW-INCOME COMMUNITY
DEVELOPMENT CAPACITY.
(a) In General.--The Secretary may make grants to nonprofit
organizations to use for any of the following purposes:
(1) Training, educating, supporting, or advising an
eligible community development organization or qualified youth
service and conservation corps in improving energy efficiency,
resource conservation and reuse, design strategies to maximize
energy efficiency, installing or constructing renewable energy
improvements (such as wind, wave, solar, biomass, and
geothermal energy sources), and effective use of existing
infrastructure in affordable housing and economic development
activities in low-income communities, taking into consideration
energy efficiency standards under section 284(a) of this
subtitle and with the enhanced energy efficiency and
conservation standards, and the green building standards, under
section 284(b) of this subtitle.
(2) Providing loans, grants, or predevelopment assistance
to eligible community development organizations or qualified
youth service and conservation corps to carry out energy
efficiency improvements that comply with the energy efficiency
standards under section 284(a) of this subtitle, resource
conservation and reuse, and effective use of existing
infrastructure in affordable housing and economic development
activities in low-income communities. In providing assistance
under this paragraph, the Secretary shall give more preference
to activities based on the extent to which the activities will
result in compliance with the enhanced energy efficiency and
conservation standards, and the green building standards, under
section 284(b) of this subtitle.
(3) Such other purposes as the Secretary determines are in
accordance with the purposes of this subsection.
(b) Application Requirement.--To be eligible for a grant under this
section, a nonprofit organization shall prepare and submit to the
Secretary an application at such time, in such manner, and containing
such information as the Secretary may require.
(c) Award of Contracts.--Contracts for architectural or engineering
services funded with amounts from grants made under this section shall
be awarded in accordance with chapter 11 of title 40, United States
Code (relating to selection of architects and engineers).
(d) Matching Requirement.--A grant made under this section may not
exceed the amount that the nonprofit organization receiving the grant
certifies, to the Secretary, will be provided (in cash or in-kind) from
nongovernmental sources to carry out the purposes for which the grant
is made.
(e) Definitions.--For purposes of this section, the following
definitions shall apply:
(1) The term ``nonprofit organization'' has the meaning
given such term in section 104 of the Cranston-Gonzalez
National Affordable Housing Act (42 U.S.C. 12704).
(2) The term ``eligible community development
organization'' means--
(A) a unit of general local government (as defined
in section 104 of the Cranston-Gonzalez National
Affordable Housing Act (42 U.S.C. 12704));
(B) a community housing development organization
(as defined in section 104 of the Cranston-Gonzalez
National Affordable Housing Act (42 U.S.C. 12704));
(C) an Indian tribe or tribally designated housing
entity (as such terms are defined in section 4 of the
Native American Housing Assistance and Self-
Determination Act of 1996 (25 U.S.C. 4103)); or
(D) a public housing agency, as such term is
defined in section 3(b) of the United States Housing
Act of 1937 (42 U.S.C. 1437(b)).
(3) The term ``low-income community'' means a census tract
in which 50 percent or more of the households have an income
which is less than 80 percent of the greater of--
(A) the median gross income for such year for the
area in which such census tract is located; or
(B) the median gross income for such year for the
State in which such census tract is located.
(f) Authorization of Appropriations.--There are authorized to be
appropriated to the Secretary to carry out this section $10,000,000 for
each of fiscal years 2010 through 2014.
SEC. 299. HOPE VI GREEN DEVELOPMENTS REQUIREMENT.
(a) Mandatory Component.--Section 24(e) of the United States
Housing Act of 1937 (42 U.S.C. 1437v(e)) is amended by adding at the
end the following new paragraph:
``(4) Green developments requirement.--
``(A) Requirement.--The Secretary may not make a
grant under this section to an applicant unless the
proposed revitalization plan of the applicant to be
carried out with such grant amounts meets the following
requirements:
``(i) Green communities criteria
checklist.--All residential construction under
the proposed plan complies with the national
Green Communities criteria checklist for
residential construction that provides criteria
for the design, development, and operation of
affordable housing, as such checklist is in
effect for purposes of this paragraph pursuant
to subparagraph (D) at the date of the
application for the grant, or any substantially
equivalent standard or standards as determined
by the Secretary, as follows:
``(I) The proposed plan shall
comply with all items of the national
Green Communities criteria checklist
for residential construction that are
identified as mandatory.
``(II) The proposed plan shall
comply with such other nonmandatory
items of such national Green
Communities criteria checklist so as to
result in a cumulative number of points
attributable to such nonmandatory items
under such checklist of not less than--
``(aa) 25 points, in the
case of any proposed plan (or
portion thereof) consisting of
new construction; and
``(bb) 20 points, in the
case of any proposed plan (or
portion thereof) consisting of
rehabilitation.
``(ii) Green buildings certification
system.--All nonresidential construction under
the proposed plan complies with all minimum
required levels of the green building rating
systems and levels identified by the Secretary
pursuant to subparagraph (C), as such systems
and levels are in effect for purposes of this
paragraph pursuant to subparagraph (D) at the
time of the application for the grant.
``(B) Verification.--
``(i) In general.--The Secretary shall
verify, or provide for verification, sufficient
to ensure that each proposed revitalization
plan carried out with amounts from a grant
under this section complies with the
requirements under subparagraph (A) and that
the revitalization plan is carried out in
accordance with such requirements and plan.
``(ii) Timing.--In providing for such
verification, the Secretary shall establish
procedures to ensure such compliance with
respect to each grantee, and shall report to
the Congress with respect to the compliance of
each grantee, at each of the following times:
``(I) Not later than 6 months after
execution of the grant agreement under
this section for the grantee.
``(II) Upon completion of the
revitalization plan of the grantee.
``(C) Identification of green buildings rating
systems and levels.--
``(i) In general.--For purposes of this
paragraph, the Secretary shall identify rating
systems and levels for green buildings that the
Secretary determines to be the most likely to
encourage a comprehensive and environmentally
sound approach to ratings and standards for
green buildings. The identification of the
ratings systems and levels shall be based on
the criteria specified in clause (ii), shall
identify the highest levels the Secretary
determines are appropriate above the minimum
levels required under the systems selected.
Within 90 days of the completion of each study
required by clause (iii), the Secretary shall
review and update the rating systems and
levels, or identify alternative systems and
levels for purposes of this paragraph, taking
into account the conclusions of such study.
``(ii) Criteria.--In identifying the green
rating systems and levels, the Secretary shall
take into consideration--
``(I) the ability and availability
of assessors and auditors to
independently verify the criteria and
measurement of metrics at the scale
necessary to implement this paragraph;
``(II) the ability of the
applicable ratings system organizations
to collect and reflect public comment;
``(III) the ability of the
standards to be developed and revised
through a consensus-based process;
``(IV) An evaluation of the
robustness of the criteria for a high-
performance green building, which shall
give credit for promoting--
``(aa) efficient and
sustainable use of water,
energy, and other natural
resources;
``(bb) use of renewable
energy sources;
``(cc) improved indoor and
outdoor environmental quality
through enhanced indoor and
outdoor air quality, thermal
comfort, acoustics, outdoor
noise pollution, day lighting,
pollutant source control,
sustainable landscaping, and
use of building system controls
and low- or no-emission
materials, including preference
for materials with no added
carcinogens that are classified
as Group 1 Known Carcinogens by
the International Agency for
Research on Cancer; and
``(dd) such other criteria
as the Secretary determines to
be appropriate; and
``(V) national recognition within
the building industry.
``(iii) 5-year evaluation.--At least once
every 5 years, the Secretary shall conduct a
study to evaluate and compare available third-
party green building rating systems and levels,
taking into account the criteria listed in
clause (ii).
``(D) Applicability and updating of standards.--
``(i) Applicability.--Except as provided in
clause (ii) of this subparagraph, the national
Green Communities criteria checklist and green
building rating systems and levels referred to
in clauses (i) and (ii) of subparagraph (A)
that are in effect for purposes of this
paragraph are such checklist systems, and
levels as in existence upon the date of the
enactment of the Green Resources for Energy
Efficient Neighborhoods Act of 2009.
``(ii) Updating.--The Secretary may, by
regulation, adopt and apply, for purposes of
this paragraph, future amendments and
supplements to, and editions of, the national
Green Communities criteria checklist, any
standard or standards that the Secretary has
determined to be substantially equivalent to
such checklist, and the green building ratings
systems and levels identified by the Secretary
pursuant to subparagraph (C).''.
(b) Selection Criteria; Graded Component.--Section 24(e)(2) of the
United States Housing Act of 1937 (42 U.S.C. 1437v(e)(2)) is amended--
(1) in subparagraph (K), by striking ``and'' at the end;
(2) by redesignating subparagraph (L) as subparagraph (M);
and
(3) by inserting after subparagraph (K) the following new
subparagraph:
``(L) the extent to which the proposed
revitalization plan--
``(i) in the case of residential
construction, complies with the nonmandatory
items of the national Green Communities
criteria checklist identified in paragraph
(4)(A)(i), or any substantially equivalent
standard or standards as determined by the
Secretary, but only to the extent such
compliance exceeds the compliance necessary to
accumulate the number of points required under
such paragraph; and
``(ii) in the case of nonresidential
construction, complies with the components of
the green building rating systems and levels
identified by the Secretary pursuant to
paragraph (4)(C), but only to the extent such
compliance exceeds the minimum level required
under such systems and levels; and''.
SEC. 299A. CONSIDERATION OF ENERGY EFFICIENCY IMPROVEMENTS IN
APPRAISALS.
(a) Appraisals in Connection With Federally Related Transactions.--
(1) Requirement.--Section 1110 of the Financial
Institutions Reform, Recovery, and Enforcement Act of 1989 (12
U.S.C. 3339) is amended--
(A) in paragraph (1), by striking ``and'' at the
end;
(B) by redesignating paragraph (2) as paragraph
(3); and
(C) by inserting after paragraph (1) the following
new paragraph:
``(2) that such appraisals be performed in accordance with
appraisal standards that require, in determining the value of a
property, consideration of any renewable energy sources for, or
energy efficiency or energy-conserving improvements or features
of, the property; and''.
(2) Revision of appraisal standards.--Each Federal
financial institutions regulatory agency shall, not later than
6 months after the date of the enactment of this Act, revise
its standards for the performance of real estate appraisals in
connection with federally related transactions under the
jurisdiction of the agency to comply with the requirement under
the amendments made by paragraph (1) of this subsection.
(b) Appraiser Certification and Licensing Requirements.--Section
1116 of the Financial Institutions Reform, Recovery, and Enforcement
Act of 1989 (12 U.S.C. 3345) is amended--
(1) in subsection (a), by inserting before the period at
the end the following: ``, and meets the requirements
established pursuant to subsection (f) for qualifications
regarding consideration of any renewable energy sources for, or
energy efficiency or energy-conserving improvements or features
of, the property'';
(2) in subsection (c), by inserting before the period at
the end the following: ``, which shall include compliance with
the requirements established pursuant to subsection (f)
regarding consideration of any renewable energy sources for, or
energy efficiency or energy-conserving improvements or features
of, the property'';
(3) in subsection (e), by striking ``The'' and inserting
``Except as provided in subsection (f), the''; and
(4) by adding at the end the following new subsection:
``(f) Requirements for Appraisers Regarding Energy Efficiency
Features.--The Appraisal Subcommittee shall establish requirements for
State certification of State certified real estate appraisers and for
State licensing of State licensed appraisers, to ensure that appraisers
consider and are qualified to consider, in determining the value of a
property, any renewable energy sources for, or energy efficiency or
energy-conserving improvements or features of, the property.''.
(c) Guidelines for Appraising Photovoltaic Measures and Training of
Appraisers.--Section 1122 of the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989 (12 U.S.C. 3351) is amended by
adding at the end the following new subsection:
``(g) Guidelines for Appraising Photovoltaic Measures and Training
of Appraisers.--The Appraisal Subcommittee shall, in consultation with
the Secretary of Housing and Urban Development, the Federal National
Mortgage Association, and the Federal Home Loan Mortgage Corporation,
establish specific guidelines for--
``(1) appraising off- and on-grid photovoltaic measures for
compliance with the appraisal standards prescribed pursuant to
section 1110(2);
``(2) requirements under section 1116(f) for certification
of State certified real estate appraisers and for State
licensing of State licensed appraisers, to ensure that
appraisers consider, and are qualified to consider, such
photovoltaic measures in determining the value of a property;
and
``(3) training of appraisers to meet the requirements
established pursuant to paragraph (2) of this subsection.''.
SEC. 299B. HOUSING ASSISTANCE COUNCIL.
The Secretary shall require the Housing Assistance Council--
(1) to encourage each organization that receives assistance
from the Council with any amounts made available from the
Secretary to provide that any structures and buildings
developed or assisted under projects, programs, and activities
funded with such amounts complies with the energy efficiency
standards under section 284(a) of this subtitle; and
(2) to establish incentives to encourage each such
organization to provide that any such structures and buildings
comply with the energy efficiency and conservation standards,
and the green building standards, under section 284(b) of such
Act.
SEC. 299C. RURAL HOUSING AND ECONOMIC DEVELOPMENT ASSISTANCE.
The Secretary shall--
(1) require each tribe, agency, organization, corporation,
and other entity that receives any assistance from the Office
of Rural Housing and Economic Development of the Department of
Housing and Urban Development to provide that any structures
and buildings developed or assisted under activities funded
with such amounts complies with the energy efficiency standards
under section 284(a) of this subtitle; and
(2) establish incentives to encourage each such tribe,
agency, organization, corporation, and other entity to provide
that any such structures and buildings comply with the enhanced
energy efficiency and conservation standards, and the green
building standards, under section 284(b) of such Act.
SEC. 299D. LOANS TO STATES AND INDIAN TRIBES TO CARRY OUT RENEWABLE
ENERGY SOURCES ACTIVITIES.
(a) Establishment of Fund.--There is established in the Treasury of
the United States a fund, to be known as the ``Alternative Energy
Sources State Loan Fund''.
(b) Expenditures.--
(1) In general.--Subject to paragraph (2), on request by
the Secretary, the Secretary of the Treasury shall transfer
from the Fund to the Secretary such amounts as the Secretary
determines are necessary to provide loans under subsection
(c)(1).
(2) Administrative expenses.--Of the amounts in the Fund,
not more than 5 percent shall be available for each fiscal year
to pay the administrative expenses of the Department of Housing
and Urban Development to carry out this section.
(c) Loans to States and Indian Tribes.--
(1) In general.--The Secretary shall use amounts in the
Fund to provide loans to States and Indian tribes to provide
incentives to owners of single-family and multifamily housing,
commercial properties, and public buildings to provide--
(A) renewable energy sources for such structures,
such as wind, wave, solar, biomass, or geothermal
energy sources, including incentives to companies and
business to change their source of energy to such
renewable energy sources and for changing the sources
of energy for public buildings to such renewable energy
sources;
(B) energy efficiency and energy conserving
improvements and features for such structures; or
(C) infrastructure related to the delivery of
electricity and hot water for structures lacking such
amenities.
(2) Eligibility.--To be eligible to receive a loan under
this subsection, a State or Indian tribe, directly or through
an appropriate State or tribal agency, shall submit to the
Secretary an application at such time, in such manner, and
containing such information as the Secretary may require.
(3) Criteria for approval.--The Secretary may approve an
application of a State or Indian tribe under paragraph (2) only
if the Secretary determines that the State or tribe will use
the funds from the loan under this subsection to carry out a
program to provide incentives described in paragraph (1) that--
(A) requires that any such renewable energy
sources, and energy efficiency and energy conserving
improvements and features, developed pursuant to
assistance under the program result in compliance of
the structure so improved with energy efficiency
requirements determined by the Secretary; and
(B) includes such compliance and audit requirements
as the Secretary determines are necessary to ensure
that the program is operated in a sound and effective
manner.
(4) Preference.--In making loans during each fiscal year,
the Secretary shall give preference to States and Indian tribes
that have not previously received a loan under this subsection.
(5) Maximum amount.--The aggregate outstanding principal
amount from loans under this subsection to any single State or
Indian tribe may not exceed $500,000,000.
(6) Loan terms.--Each loan under this subsection shall have
a term to maturity of not more than 10 years and shall bear
interest at annual rate, determined by the Secretary, that
shall not exceed interest rate charged by the Federal Reserve
Bank of New York to commercial banks and other depository
institutions for very short-term loans under the primary credit
program, as most recently published in the Federal Reserve
Statistical Release on selected interest rates (daily or
weekly), and commonly referred to as the H.15 release,
preceding the date of a determination for purposes of applying
this paragraph.
(7) Loan repayment.--The Secretary shall require full
repayment of each loan made under this section.
(d) Investment of Amounts.--
(1) In general.--The Secretary of the Treasury shall invest
such amounts in the Fund that are not, in the judgment of the
Secretary of the Treasury, required to meet needs for current
withdrawals.
(2) Obligations of united states.--Investments may be made
only in interest-bearing obligations of the United States.
(e) Reports.--
(1) Reports to secretary.--For each year during the term of
a loan made under subsection (c), the State or Indian tribe
that received the loan shall submit to the Secretary a report
describing the State or tribal alternative energy sources
program for which the loan was made and the activities
conducted under the program using the loan funds during that
year.
(2) Report to congress.--Not later than September 30 of
each year that loans made under subsection (c) are outstanding,
the Secretary shall submit a report to the Congress describing
the total amount of such loans provided under subsection (c) to
each eligible State and Indian tribe during the fiscal year
ending on such date, and an evaluation on effectiveness of the
Fund.
(f) Authorization of Appropriations.--There is authorized to be
appropriated to the Fund $5,000,000,000.
(g) Definitions.--For purposes of this section, the following
definitions shall apply:
(1) Indian tribe.--The term ``Indian tribe'' has the
meaning given such term in section 4 of the Native American
Housing Assistance and Self-Determination Act of 1996 (25
U.S.C. 4103).
(2) State.--The term ``State'' means each of the several
States, the Commonwealth of Puerto Rico, the District of
Columbia, the Commonwealth of the Northern Mariana Islands,
Guam, the Virgin Islands, American Samoa, the Trust Territories
of the Pacific, or any other possession of the United States.
SEC. 299E. GREEN BANKING CENTERS.
(a) Insured Depository Institutions.--Section 8 of the Federal
Deposit Insurance Act (12 U.S.C. 1818) is amended by adding at the end
the following new subsection:
``(x) `Green Banking' Centers.--
``(1) In general.--The Federal banking agencies shall
prescribe guidelines encouraging the establishment and
maintenance of `green banking' centers by insured depository
institutions to provide any consumer who seeks information on
obtaining a mortgage, home improvement loan, home equity loan,
or renewable energy lease with additional information on--
``(A) obtaining an home energy rating or audit for
the residence for which such mortgage or loan is
sought;
``(B) obtaining financing for cost-effective
energy-saving improvements to such property; and
``(C) obtaining beneficial terms for any mortgage
or loan, or qualifying for a larger mortgage or loan,
secured by a residence which meets or will meet energy
efficiency standards.
``(2) Information and referrals.--The information made
available to consumers under paragraph (1) may include--
``(A) information on obtaining a home energy rating
and contact information on qualified energy raters in
the area of the residence;
``(B) information on the secondary market
guidelines that permit lenders to provide more
favorable terms by allowing lenders to increase the
ratio on debt-to-income requirements or to use the
projected utility savings as a compensating factor;
``(C) information including eligibility information
about, and contact information for, any conservation or
renewable energy programs, grants, or loans offered by
the Secretary of Housing and Urban Development,
including the Energy Efficient Mortgage Program;
``(D) information including eligibility information
about, and contact information for, any conservation or
renewable energy programs, grants, or loans offered for
qualified military personal, reservists, and veterans
by the Secretary of Veterans Affairs;
``(E) information about, and contact information
for, the Office of Efficiency and Renewable Energy at
the Department of Energy, including the weatherization
assistance program;
``(F) information about, and contact information
for, the Energy Star Program of the Environmental
Protection Agency;
``(G) information from, and contact information
for, the Federal Citizen Information Center of the
General Services Administration on energy-efficient
mortgages and loans, home energy rating systems, and
the availability of energy-efficient mortgage
information from a variety of Federal agencies; and
``(H) such other information as the agencies or the
insured depository institution may determine to be
appropriate or useful.''.
(b) Insured Credit Unions.--Section 206 of the Federal Credit Union
Act (12 U.S.C. 1786) is amended by adding at the end the following new
subsection:
``(x) `Green Banking' Centers.--
``(1) In general.--The Board shall prescribe guidelines
encouraging the establishment and maintenance of `green
banking' centers by insured credit unions to provide any member
who seeks information on obtaining a mortgage, home improvement
loan, home equity loan, or renewable energy lease with
additional information on--
``(A) obtaining an home energy rating or audit for
the residence for which such mortgage or loan is
sought;
``(B) obtaining financing for cost-effective
energy-saving improvements to such property; and
``(C) obtaining beneficial terms for any mortgage
or loan, or qualifying for a larger mortgage or loan,
secured by a residence which meets or will meet energy
efficiency standards.
``(2) Information and referrals.--The information made
available to members under paragraph (1) may include--
``(A) information on obtaining a home energy rating
and contact information on qualified energy raters in
the area of the residence;
``(B) information on the secondary market
guidelines that permit lenders to provide more
favorable terms by allowing lenders to increase the
ratio on debt-to-income requirements or to use the
projected utility savings as a compensating factor;
``(C) information including eligibility information
about, and contact information for, any conservation or
renewable energy programs, grants, or loans offered by
the Secretary of Housing and Urban Development,
including the Energy Efficient Mortgage Program;
``(D) information including eligibility information
about, and contact information for, any conservation or
renewable energy programs, grants, or loans offered for
qualified military personal, reservists, and veterans
by the Secretary of Veterans Affairs;
``(E) information about, and contact information
for, the Office of Efficiency and Renewable Energy at
the Department of Energy, including the weatherization
assistance program;
``(F) information from, and contact information
for, the Federal Citizen Information Center of the
General Services Administration on energy-efficient
mortgages and loans, home energy rating systems, and
the availability of energy-efficient mortgage
information from a variety of Federal agencies; and
``(G) such other information as the Board or the
insured credit union may determine to be appropriate or
useful.''.
SEC. 299F. GAO REPORTS ON AVAILABILITY OF AFFORDABLE MORTGAGES.
(a) Study.--The Comptroller General of the United States shall
periodically, as necessary to comply with subsection (b), examine the
impact of this subtitle and the amendments made by this subtitle on the
availability of affordable mortgages in various areas throughout the
United States, including cities having older infrastructure and limited
space for the development of new housing.
(b) Triennial Reports.--The Comptroller General shall submit a
report once every 3 years to the Committee on Financial Services of the
House of Representatives and the Committee on Banking, Housing, and
Urban Affairs of the Senate that shall include--
(1) a detailed statement of the most recent findings
pursuant to subsection (a); and
(2) if the Comptroller General finds that this subtitle or
the amendments made by this subtitle have directly or
indirectly resulted in consequences that limit the availability
or affordability of mortgages in any area or areas within the
United States, including any city having older infrastructure
and limited space for the development of new housing, any
recommendations for any additional actions at the Federal,
State, or local levels that the Comptroller General considers
necessary or appropriate to mitigate such effects.
The first report under this subsection shall be submitted not later
than the expiration of the 3-year period beginning on the date of the
enactment of this Act.
SEC. 299G. PUBLIC HOUSING ENERGY COST REPORT.
(a) Collection of Information by HUD.--The Secretary of Housing and
Urban Development shall obtain from each public housing agency, by such
time as may be necessary to comply with the reporting requirement under
subsection (b), information regarding the energy costs for public
housing administered or operated by the agency. For each public housing
agency, such information shall include the monthly energy costs
associated with each separate building and development of the agency,
for the most recently completed 12-month period for which such
information is available, and such other information as the Secretary
determines is appropriate in determining which public housing buildings
and developments are most in need of repairs and improvements to reduce
energy needs and costs and become more energy efficient.
(b) Report.--Not later than the expiration of the 12-month period
beginning on the date of the enactment of this Act, the Secretary of
Housing and Urban Development shall submit a report to the Congress
setting forth the information collected pursuant to subsection (a).
SEC. 299H. SECONDARY MARKET FOR RESIDENTIAL RENEWABLE ENERGY LEASE
INSTRUMENTS.
(a) Purposes.--The purposes of this section are--
(1) to encourage residential use of renewable energy
systems by minimizing up-front costs and providing immediate
utility cost savings to consumers through leasing of such
systems to homeowners;
(2) to reduce carbon emissions and the use of nonrenewable
resources;
(3) to encourage energy-efficient residential construction
and rehabilitation;
(4) to encourage the use of renewable resources by
homeowners;
(5) to minimize the impact of development on the
environment;
(6) to reduce consumer utility costs; and
(7) to encourage private investment in the green economy.
(b) Residual Value of Renewable Energy Asset.--The Secretary of
Housing and Urban Development shall establish a means of determining
the residual value of a renewable energy asset such that a secondary
market for residential renewable energy lease instruments may be
facilitated. Such means may include, without limitation, the
calculation of residual value based on the net present value of
projected future energy production of the renewable energy asset.
SEC. 299I. GREEN GUARANTEES.
(a) Authority To Guarantee ``Green Portion'' of Eligible
Mortgages.--
(1) In general.--The Secretary of Housing and Urban
Development may make commitments to guarantee under this
section and may guarantee, the repayment of the portions of the
principal obligations of eligible mortgages that are used to
finance eligible sustainable building elements for the housing
that is subject to the mortgage.
(2) Amount of guarantee.--A guarantee under this section by
the Secretary in connection with an eligible mortgage shall not
exceed a percentage of the green portion (as such term is
defined in subsection (g)) of the mortgage, as shall be
established by the Secretary and may be established on a
regional basis as the Secretary determines appropriate.
(b) Eligible Mortgages.--To be considered an eligible mortgage for
purposes of this section, a mortgage shall comply with all of the
following requirements:
(1) Acquisition or construction of housing.--The mortgage
shall be made for the acquisition or construction of single- or
multifamily housing and repayment of the mortgage shall be
secured by an interest in such housing.
(2) Financing of eligible sustainable building elements
through green portion of mortgage.--A portion of the principal
obligation of the mortgage, which meets the requirements under
subsection (c), shall be used only for financing the provision
of eligible sustainable building elements for the housing for
which the mortgage was made.
(3) Maximum mortgage amount.--The principal obligation of
the mortgage (including the eligible portion of such mortgage,
and such initial service charges, appraisal, inspection, and
other fees as the Secretary shall approve) may not exceed the
following amounts:
(A) Single-family housing.--Such dollar amounts for
single-family housing as the Secretary shall establish,
which may be established on the basis of the number of
dwelling units in the housing, as the Secretary
considers appropriate.
(B) Multifamily housing.--Such dollar amounts for
multifamily housing as the Secretary shall establish,
which may be established on the basis of the number of
dwelling units in the housing and the number of
bedrooms in such dwelling units, as the Secretary
considers appropriate.
(4) Repayment.--The mortgage meets such requirements as the
Secretary shall establish to ensure that there is a reasonable
prospect of repayment of the principal and interest on the
obligation by the mortgagor.
(5) Mortgage terms.--The mortgage shall meet such
requirements with respect to loan-to-value ratio, mortgagor
credit scores, debt-to-income ratio, and other underwriting
standards, term to maturity, interest rates and amortization,
including amortization of the green portion of the mortgage,
and other mortgage terms as the Secretary shall establish.
(c) Limitations on Green Portion of Mortgage.--The requirements
under this subsection with respect to the green portion of an eligible
mortgage are as follows:
(1) Percentage limitation.--Such portion shall not exceed,
in the case of single-family or multifamily housing, 10 percent
of the total principal obligation of the mortgage.
(2) Dollar amount limitation.--Such portion shall not
exceed--
(A) in the case of single-family housing, such
maximum dollar amount limitation as the Secretary shall
establish, which may be established on the basis of the
number of dwelling units in the housing, as the
Secretary considers appropriate; and
(B) in the case of multifamily housing, such
maximum dollar amount limitation as the Secretary shall
establish, which limitation may be established on the
basis of the number of dwelling units in the housing
and the number of bedrooms in such dwelling units, as
the Secretary considers appropriate.
(3) Cost-effectiveness limitation.--Such portion shall not
exceed the total present value of the savings (as determined in
accordance with subsection (d)) attributable to the
incorporation of the eligible sustainable building elements to
be financed with the green portion of the mortgage that are to
be realized over the useful life of such elements.
(d) Eligible Sustainable Building Elements.--The Secretary may not
guarantee any eligible mortgage under this section unless the mortgagor
has demonstrated, in accordance with such requirements as the Secretary
shall establish, the amount of savings attributable to incorporation of
the sustainable building elements to be financed with the green portion
of the mortgage, as measured by the National Green Building Standard
for all residential construction developed by the National Association
of Home Builders and the U.S. Green Building Council, and approved by
the American National Standards Institute, as updated and in effect at
the time of such demonstration.
(e) Guarantee Fee.--
(1) Assessment and collection.--The Secretary shall assess
and collect fees for guarantees under this section in amounts
that the Secretary determines are sufficient to cover the costs
(as such term is defined in section 502 of the Federal Credit
Reform Act of 1990 (2 U.S.C. 661a)) of such guarantees.
(2) Availability.--Fees collected under this subsection
shall be deposited by the Secretary in the Treasury of the
United States and shall remain available until expended,
subject to such other conditions as are contained in annual
appropriations Acts.
(f) Payment of Guarantee.--
(1) Default.--
(A) Right to payment.--If a mortgagor under a
mortgage guaranteed under this section defaults (as
defined in regulations issued by the Secretary and
specified in the guarantee contract) on the obligation
under the mortgage--
(i) the holder of the guarantee shall have
the right to demand payment of the unpaid
amount of the guaranteed portion of the
mortgage, to the extent provided under
subsection (a)(2), from the Secretary; and
(ii) within such period as may be specified
in the guarantee or related agreements, the
Secretary shall pay to the holder of the
guarantee, to the extent provided under
subsection (a)(2), the unpaid interest on, and
unpaid principal of the portion of guaranteed
portion of the mortgage with respect to which
the borrower has defaulted, unless the
Secretary finds that there was no default by
the borrower in the payment of interest or
principal or that the default has been
remedied.
(B) Forbearance.--Nothing in this paragraph
precludes any forbearance by the holder of an eligible
mortgage for the benefit of the mortgagor which may be
agreed upon by the parties to the mortgage and approved
by the Secretary.
(2) Subrogation.--
(A) In general.--If the Secretary makes a payment
under paragraph (1), the Secretary shall be subrogated
to the rights of the recipient of the payment as
specified in the guarantee or related agreements
including, if appropriate, the authority
(notwithstanding any other provision of law)--
(i) to complete, maintain, operate, lease,
or otherwise dispose of any property acquired
pursuant to such guarantee or related
agreements; or
(ii) to permit the mortgagor, pursuant to
an agreement with the Secretary, to continue to
occupy the property subject to the mortgage, if
the Secretary determines such occupancy to be
appropriate.
(B) Superiority of rights.--The rights of the
Secretary, with respect to any property acquired
pursuant to a guarantee or related agreements, shall be
superior to the rights of any other person with respect
to the property.
(C) Terms and conditions.--A guarantee agreement
shall include such detailed terms and conditions as the
Secretary determines appropriate to protect the
interests of the United States in the case of default.
(3) Full faith and credit.--The full faith and credit of
the United States is pledged to the payment of all guarantees
issued under this section with respect to principal and
interest.
(g) Definitions.--For purposes of this section, the following
definitions shall apply:
(1) Eligible mortgage.--The term ``eligible mortgage''
means a mortgage that meets the requirements under subsection
(b).
(2) Green portion.--The term ``green portion'' means, with
respect to an eligible mortgage, the portion of the mortgage
principal referred to in subsection (b)(2) that is
attributable, as determined in accordance with regulations
issued by the Secretary, to the increased costs incurred in
financing provision of sustainable building elements for the
housing for which the mortgage was made, as compared to the
costs that would have been incurred in financing the provision
of other building elements for the housing for the same
purposes that are commonly or conventionally used but are not
sustainable building elements.
(3) Guaranteed portion.--The term ``guaranteed portion''
means, with respect to an eligible mortgage guaranteed under
this section, the green portion of the mortgage that is so
guaranteed.
(4) Mortgage.--The term ``mortgage'' has the meaning given
such term in section 201 of the National Housing Act (12 U.S.C.
1707).
(5) Multifamily housing.--The term ``multifamily housing''
means a residential property consisting of five or more
dwelling units.
(6) Secretary.--The term ``Secretary'' means the Secretary
of Housing and Urban Development.
(7) Single-family housing.--The term ``single-family
housing'' means a residential property consisting of one to
four dwelling units.
(8) Sustainable building element.--The term ``sustainable
building element'' means such building elements, as the
Secretary shall define, that have energy efficiency or
environmental sustainability qualities that are superior to
such qualities for other building elements for the same
purposes that are commonly or conventionally used.
(h) Authorization of Appropriations.--There is authorized to be
appropriated for costs (as such term is defined in section 502 of the
Federal Credit Reform Act of 1990 (2 U.S.C. 661a) of guarantees under
this section $500,000,000 for each of fiscal years 2010 through 2014.
(i) Regulations.--The Secretary shall issue any regulations
necessary to carry out this section.
TITLE III--REDUCING GLOBAL WARMING POLLUTION
SEC. 301. SHORT TITLE.
This title, and sections 112, 116, 221, 222, 223, and 401 of this
Act, and the amendments made by this title and those sections, may be
cited as the ``Safe Climate Act''.
Subtitle A--Reducing Global Warming Pollution
SEC. 311. REDUCING GLOBAL WARMING POLLUTION.
The Clean Air Act (42 U.S.C. and following) is amended by adding
after title VI the following new title:
``TITLE VII--GLOBAL WARMING POLLUTION REDUCTION PROGRAM
``PART A--GLOBAL WARMING POLLUTION REDUCTION GOALS AND TARGETS
``SEC. 701. FINDINGS AND PURPOSE.
``(a) Findings.--The Congress finds as follows:
``(1) Global warming poses a significant threat to the
national security, economy, public health and welfare, and
environment of the United States, as well as of other nations.
``(2) Reviews of scientific studies, including by the
Intergovernmental Panel on Climate Change and the National
Academy of Sciences, demonstrate that global warming is the
result of the combined anthropogenic greenhouse gas emissions
from numerous sources of all types and sizes. Each increment of
emission, when combined with other emissions, causes or
contributes materially to the acceleration and extent of global
warming and its adverse effects for the lifetime of such gas in
the atmosphere. Accordingly, controlling emissions in small as
well as large amounts is essential to prevent, slow the pace
of, reduce the threats from, and mitigate global warming and
its adverse effects.
``(3) Because they induce global warming, greenhouse gas
emissions cause or contribute to injuries to persons in the
United States, including--
``(A) adverse health effects such as disease and
loss of life;
``(B) displacement of human populations;
``(C) damage to property and other interests
related to ocean levels, acidification, and ice
changes;
``(D) severe weather and seasonal changes;
``(E) disruption, costs, and losses to business,
trade, employment, farms, subsistence, aesthetic
enjoyment of the environment, recreation, culture, and
tourism;
``(F) damage to plants, forests, lands, and waters;
``(G) harm to wildlife and habitat;
``(H) scarcity of water and the decreased abundance
of other natural resources;
``(I) worsening of tropospheric air pollution;
``(J) substantial threats of similar damage; and
``(K) other harm.
``(4) That many of these effects and risks of future
effects of global warming are widely shared does not minimize
the adverse effects individual persons have suffered, will
suffer, and are at risk of suffering because of global warming.
``(5) That some of the adverse and potentially catastrophic
effects of global warming are at risk of occurring and not a
certainty does not negate the harm persons suffer from actions
that increase the likelihood, extent, and severity of such
future impacts.
``(6) Nations of the world look to the United States for
leadership in addressing the threat of and harm from global
warming. Full implementation of the Safe Climate Act is
critical to engage other nations in an international effort to
mitigate the threat of and harm from global warming.
``(7) Global warming and its adverse effects are occurring
and are likely to continue and increase in magnitude, and to do
so at a greater and more harmful rate, unless the Safe Climate
Act is fully implemented and enforced in an expeditious manner.
``(b) Purpose.--It is the general purpose of the Safe Climate Act
to help prevent, reduce the pace of, mitigate, and remedy global
warming and its adverse effects. To fulfill such purpose, it is
necessary to--
``(1) require the timely fulfillment of all governmental
acts and duties, both substantive and procedural, and the
prompt compliance of covered entities with the requirements of
the Safe Climate Act;
``(2) establish and maintain an effective, transparent, and
fair market for emission allowances and preserve the integrity
of the cap on emissions and of offset credits;
``(3) advance the production and deployment of clean energy
and energy efficiency technologies; and
``(4) ensure effective enforcement of the Safe Climate Act
by citizens, States, Indian tribes, and all levels of
government because each violation of the Safe Climate Act is
likely to result in an additional increment of greenhouse gas
emission and will slow the pace of implementation of the Safe
Climate Act and delay the achievement of the goals set forth in
section 702, and cause or contribute to global warming and its
adverse effects.
``SEC. 702. ECONOMY-WIDE REDUCTION GOALS.
``The goals of the Safe Climate Act are to reduce steadily the
quantity of United States greenhouse gas emissions such that--
``(1) in 2012, the quantity of United States greenhouse gas
emissions does not exceed 97 percent of the quantity of United
States greenhouse gas emissions in 2005;
``(2) in 2020, the quantity of United States greenhouse gas
emissions does not exceed 80 percent of the quantity of United
States greenhouse gas emissions in 2005;
``(3) in 2030, the quantity of United States greenhouse gas
emissions does not exceed 58 percent of the quantity of United
States greenhouse gas emissions in 2005; and
``(4) in 2050, the quantity of United States greenhouse gas
emissions does not exceed 17 percent of the quantity of United
States greenhouse gas emissions in 2005.
``SEC. 703. REDUCTION TARGETS FOR SPECIFIED SOURCES.
``(a) In General.--The regulations issued under section 721 shall
cap and reduce annually the greenhouse gas emissions of capped sources
each calendar year beginning in 2012 such that--
``(1) in 2012, the quantity of greenhouse gas emissions
from capped sources does not exceed 97 percent of the quantity
of greenhouse gas emissions from such sources in 2005;
``(2) in 2020, the quantity of greenhouse gas emissions
from capped sources does not exceed 83 percent of the quantity
of greenhouse gas emissions from such sources in 2005;
``(3) in 2030, the quantity of greenhouse gas emissions
from capped sources does not exceed 58 percent of the quantity
of greenhouse gas emissions from such sources in 2005; and
``(4) in 2050, the quantity of greenhouse gas emissions
from capped sources does not exceed 17 percent of the quantity
of greenhouse gas emissions from such sources in 2005.
``(b) Definition.--For purposes of this section, the term
`greenhouse gas emissions from such sources in 2005' means emissions to
which section 722 would have applied if the requirements of this title
for the specified year had been in effect for 2005.
``SEC. 704. SUPPLEMENTAL POLLUTION REDUCTIONS.
``For the purposes of decreasing the likelihood of catastrophic
climate change, preserving tropical forests, building capacity to
generate offset credits, and facilitating international action on
global warming, the Administrator shall set aside the percentage
specified in section 781 of the quantity of emission allowances
established under section 721(a) for each year, to be used to achieve a
reduction of greenhouse gas emissions from deforestation in developing
countries in accordance with part E. In 2020, activities supported
under part E shall provide greenhouse gas reductions in an amount equal
to an additional 10 percentage points of reductions from United States
greenhouse gas emissions in 2005. The Administrator shall distribute
these allowances with respect to activities in countries that enter
into and implement agreements or arrangements relating to reduced
deforestation as described in section 754(a)(2).
``SEC. 705. REVIEW AND PROGRAM RECOMMENDATIONS.
``(a) In General.--The Administrator shall, in consultation with
appropriate Federal agencies, submit to Congress a report not later
than July 1, 2013, and every 4 years thereafter, that includes--
``(1) an analysis of key findings based on the latest
scientific information and data relevant to global climate
change;
``(2) an analysis of capabilities to monitor and verify
greenhouse gas reductions on a worldwide basis, including for
the United States, as required under the Safe Climate Act; and
``(3) an analysis of the status of worldwide greenhouse gas
reduction efforts, including implementation of the Safe Climate
Act and other policies, both domestic and international, for
reducing greenhouse gas emissions, preventing dangerous
atmospheric concentrations of greenhouse gases, preventing
significant irreversible consequences of climate change, and
reducing vulnerability to the impacts of climate change.
``(b) Exception.--Paragraph (3) of subsection (a) shall not apply
to the first report submitted under such subsection.
``(c) Latest Scientific Information.--The analysis required under
subsection (a)(1) shall--
``(1) address existing scientific information and reports,
considering, to the greatest extent possible, the most recent
assessment report of the Intergovernmental Panel on Climate
Change, reports by the United States Global Change Research
Program, the Natural Resources Climate Change Adaptation Panel
established under section 475 of the American Clean Energy and
Security Act of 2009, and Federal agencies, and the European
Union's global temperature data assessment; and
``(2) review trends and projections for--
``(A) global and country-specific annual emissions
of greenhouse gases, and cumulative greenhouse gas
emissions produced between 1850 and the present,
including--
``(i) global cumulative emissions of
anthropogenic greenhouse gases;
``(ii) global annual emissions of
anthropogenic greenhouse gases; and
``(iii) by country, annual total, annual
per capita, and cumulative anthropogenic
emissions of greenhouse gases for the top 50
emitting nations;
``(B) significant changes, both globally and by
region, in annual net non-anthropogenic greenhouse gas
emissions from natural sources, including permafrost,
forests, or oceans;
``(C) global atmospheric concentrations of
greenhouse gases, expressed in annual concentration
units as well as carbon dioxide equivalents based on
100-year global warming potentials;
``(D) major climate forcing factors, such as
aerosols;
``(E) global average temperature, expressed as
seasonal and annual averages in land, ocean, and land-
plus-ocean averages; and
``(F) sea level rise;
``(3) assess the current and potential impacts of global
climate change on--
``(A) human populations, including impacts on
public health, economic livelihoods, subsistence, human
infrastructure, and displacement or permanent
relocation due to flooding, severe weather, extended
drought, erosion, or other ecosystem changes;
``(B) freshwater systems, including water resources
for human consumption and agriculture and natural and
managed ecosystems, flood and drought risks, and
relative humidity;
``(C) the carbon cycle, including impacts related
to the thawing of permafrost, the frequency and
intensity of wildfire, and terrestrial and ocean carbon
sinks;
``(D) ecosystems and animal and plant populations,
including impacts on species abundance, phenology, and
distribution;
``(E) oceans and ocean ecosystems, including
effects on sea level, ocean acidity, ocean
temperatures, coral reefs, ocean circulation,
fisheries, and other indicators of ocean ecosystem
health;
``(F) the cryosphere, including effects on ice
sheet mass balance, mountain glacier mass balance, and
sea-ice extent and volume;
``(G) changes in the intensity, frequency, or
distribution of severe weather events, including
precipitation, tropical cyclones, tornadoes, and severe
heat waves;
``(H) agriculture and forest systems; and
``(I) any other indicators the Administrator deems
appropriate;
``(4) summarize any significant socio-economic impacts of
climate change in the United States, including the territories
of the United States, drawing on work by Federal agencies and
the academic literature, including impacts on--
``(A) public health;
``(B) economic livelihoods and subsistence;
``(C) displacement or permanent relocation due to
flooding, severe weather, extended drought, erosion, or
other ecosystem changes;
``(D) human infrastructure, including coastal
infrastructure vulnerability to extreme events and sea
level rise, river floodplain infrastructure, and sewer
and water management systems;
``(E) agriculture and forests, including effects on
potential growing season, distribution, and yield;
``(F) water resources for human consumption,
agriculture and natural and managed ecosystems, flood
and drought risks, and relative humidity;
``(G) energy supply and use; and
``(H) transportation;
``(5) in assessing risks and impacts, use a risk management
framework, including both qualitative and quantitative
measures, to assess the observed and projected impacts of
current and future climate change, accounting for--
``(A) both monetized and non-monetized losses;
``(B) potential nonlinear, abrupt, or essentially
irreversible changes in the climate system;
``(C) potential nonlinear increases in the cost of
impacts;
``(D) potential low-probability, high impact
events; and
``(E) whether impacts are transitory or essentially
permanent; and
``(6) based on the findings of the Administrator under this
section, as well as assessments produced by the
Intergovernmental Panel on Climate Change, the United States
Global Change Research program, and other relevant scientific
entities--
``(A) describe increased risks to natural systems
and society that would result from an increase in
global average temperature 3.6 degrees Fahrenheit (2
degrees Celsius) above the pre-industrial average or an
increase in atmospheric greenhouse gas concentrations
above 450 parts per million carbon dioxide equivalent;
and
``(B) identify and assess--
``(i) significant residual risks not
avoided by the thresholds described in
subparagraph (A);
``(ii) alternative thresholds or targets
that may more effectively limit the risks
identified pursuant to clause (i); and
``(iii) thresholds above those described in
subparagraph (A) which significantly increase
the risk of certain impacts or render them
essentially permanent.
``(d) Status of Monitoring and Verification Capabilities to
Evaluate Greenhouse Gas Reduction Efforts.--The analysis required under
subsection (a)(2) shall evaluate the capabilities of the monitoring,
reporting, and verification systems used to quantify progress in
achieving reductions in greenhouse gas emissions both globally and in
the United States (as described in section 702), including--
``(1) quantification of emissions and emission reductions
by entities participating in the cap and trade program under
this title;
``(2) quantification of emissions and emission reductions
by entities participating in the offset program under this
title;
``(3) quantification of emission and emissions reductions
by entities regulated by performance standards;
``(4) quantification of aggregate net emissions and
emissions reductions by the United States; and
``(5) quantification of global changes in net emissions and
in sources and sinks of greenhouse gases.
``(e) Status of Greenhouse Gas Reduction Efforts.--The analysis
required under subsection (a)(3) shall address--
``(1) whether the programs under Safe Climate Act and other
Federal statutes are resulting in sufficient United States
greenhouse gas emissions reductions to meet the emissions
reduction goals described in section 702, taking into account
the use of offsets; and
``(2) whether United States actions, taking into account
international actions, commitments, and trends, and considering
the range of plausible emissions scenarios, are sufficient to
avoid--
``(A) atmospheric greenhouse gas concentrations
above 450 parts per million carbon dioxide equivalent;
``(B) global average surface temperature 3.6
degrees Fahrenheit (2 degrees Celsius) above the pre-
industrial average, or such other temperature
thresholds as the Administrator deems appropriate; and
``(C) other temperature or greenhouse gas
thresholds identified pursuant to subsection (c)(6)(B).
``(f) Recommendations.--
``(1) Latest scientific information.--Based on the analysis
described in subsection (a)(1), each report under subsection
(a) shall identify actions that could be taken to--
``(A) improve the characterization of changes in
the earth-climate system and impacts of global climate
change;
``(B) better inform decision making and actions
related to global climate change;
``(C) mitigate risks to natural and social systems;
and
``(D) design policies to better account for climate
risks.
``(2) Monitoring, reporting and verification.--Based on the
analysis described in subsection (a)(2), each report under
subsection (a) shall identify key gaps in measurement,
reporting, and verification capabilities and make
recommendations to improve the accuracy and reliability of
those capabilities.
``(3) Status of greenhouse gas reduction efforts.--Based on
the analysis described in subsection (a)(3), taking into
account international actions, commitments, and trends, and
considering the range of plausible emissions scenarios, each
report under subsection (a) shall identify--
``(A) the quantity of additional reductions
required to meet the emissions reduction goals in
section 702;
``(B) the quantity of additional reductions in
global greenhouse gas emissions needed to avoid the
concentration and temperature thresholds identified in
subsection (e); and
``(C) possible strategies and approaches for
achieving additional reductions.
``(g) Authorization of Appropriations.--There are authorized to be
appropriated to carry out this section such sums as may be necessary.
``SEC. 706. NATIONAL ACADEMY REVIEW.
``(a) In General.--Not later than 1 year after the date of
enactment of this title, the Administrator shall offer to enter into a
contract with the National Academy of Sciences (in this section
referred to as the `Academy') under which the Academy shall, not later
than July 1, 2014, and every 4 years thereafter, submit to Congress and
the Administrator a report that includes--
``(1) a review of the most recent report and
recommendations issued under section 705; and
``(2) an analysis of technologies to achieve reductions in
greenhouse gas emissions.
``(b) Failure to Issue a Report.--In the event that the
Administrator has not issued all or part of the most recent report
required under section 705, the Academy shall conduct its own review
and analysis of the required information.
``(c) Technological Information.--The analysis required under
subsection (a)(2) shall--
``(1) review existing technological information and
reports, including the most recent reports by the Department of
Energy, the United States Global Change Research Program, the
Intergovernmental Panel on Climate Change, and the
International Energy Agency and any other relevant information
on technologies or practices that reduce or limit greenhouse
gas emissions;
``(2) include the participation of technical experts from
relevant private industry sectors;
``(3) review the current and future projected deployment of
technologies and practices in the United States that reduce or
limit greenhouse gas emissions, including--
``(A) technologies for capture and sequestration of
greenhouse gases;
``(B) technologies to improve energy efficiency;
``(C) low- or zero-greenhouse gas emitting energy
technologies;
``(D) low- or zero-greenhouse gas emitting fuels;
``(E) biological sequestration practices and
technologies; and
``(F) any other technologies the Academy deems
relevant; and
``(4) review and compare the emissions reduction potential,
commercial viability, market penetration, investment trends,
and deployment of the technologies described in paragraph (3),
including--
``(A) the need for additional research and
development, including publicly funded research and
development;
``(B) the extent of commercial deployment,
including, where appropriate, a comparison to the cost
and level of deployment of conventional fossil fuel-
fired energy technologies and devices; and
``(C) an evaluation of any substantial
technological, legal, or market-based barriers to
commercial deployment.
``(d) Recommendations.--
``(1) Latest scientific information.--Based on the review
described in subsection (a)(1), the Academy shall identify
actions that could be taken to--
``(A) improve the characterization of changes in
the earth-climate system and impacts of global climate
change;
``(B) better inform decision making and actions
related to global climate change;
``(C) mitigate risks to natural and social systems;
``(D) design policies to better account for climate
risks; and
``(E) improve the accuracy and reliability of
capabilities to monitor, report, and verify greenhouse
gas emissions reduction efforts.
``(2) Technological information.--Based on the analysis
described in subsection (a)(2), the Academy shall identify--
``(A) additional emissions reductions that may be
possible as a result of technologies described in the
analysis;
``(B) barriers to the deployment of such
technologies; and
``(C) actions that could be taken to speed
deployment of such technologies.
``(3) Status of greenhouse gas reduction efforts.--Based on
the review described in subsection (a)(1), the Academy shall
identify--
``(A) the quantity of additional reductions
required to meet the emissions reduction goals
described in section 702; and
``(B) the quantity of additional reductions in
global greenhouse gas emissions needed to avoid the
concentration and temperature thresholds described in
section 705(c)(6)(A) or identified pursuant to section
705(c)(6)(B).
``(e) Authorization of Appropriations.--There are authorized to be
appropriated to carry out this section such sums as may be necessary.
``SEC. 707. PRESIDENTIAL RESPONSE AND RECOMMENDATIONS.
``(a) Agency Actions.--The President shall direct relevant Federal
agencies to use existing statutory authority to take appropriate
actions identified in the reports submitted under sections 705 and 706,
and to address any shortfalls identified in such reports, not later
than July 1, 2015, and every 4 years thereafter.
``(b) Plan.--In the event that the Administrator or the National
Academy of Sciences has concluded, in the most recent report submitted
under section 705 or 706 respectively, that the United States will not
achieve the necessary domestic greenhouse gas emissions reductions, or
that global actions will not maintain safe global average surface
temperature and atmospheric greenhouse gas concentration thresholds,
the President shall, not later than July 1, 2015, and every 4 years
thereafter, submit to Congress a plan identifying domestic and
international actions that will achieve necessary additional greenhouse
gas reductions, including any recommendations for legislative action.
``PART B--DESIGNATION AND REGISTRATION OF GREENHOUSE GASES
``SEC. 711. DESIGNATION OF GREENHOUSE GASES.
``(a) Greenhouse Gases.--For purposes of this title, the following
are greenhouse gases:
``(1) Carbon dioxide.
``(2) Methane.
``(3) Nitrous oxide.
``(4) Sulfur hexafluoride.
``(5) Hydrofluorocarbons emitted from a chemical
manufacturing process at an industrial stationary source.
``(6) Any perfluorocarbon.
``(7) Nitrogen trifluoride.
``(8) Any other anthropogenic gas designated as a
greenhouse gas by the Administrator under this section.
``(b) Determination on Administrator's Initiative.--The
Administrator shall, by rule--
``(1) determine whether 1 metric ton of another
anthropogenic gas makes the same or greater contribution to
global warming over 100 years as 1 metric ton of carbon
dioxide;
``(2) determine the carbon dioxide equivalent value for
each gas with respect to which the Administrator makes an
affirmative determination under paragraph (1);
``(3) for each gas with respect to which the Administrator
makes an affirmative determination under paragraph (1) and that
is used as a substitute for a class I or class II substance
under title VI, determine the extent to which to regulate that
gas under section 619 and specify appropriate compliance
obligations under section 619;
``(4) designate as a greenhouse gas for purposes of this
title each gas for which the Administrator makes an affirmative
determination under paragraph (1), to the extent that it is not
regulated under section 619; and
``(5) specify the appropriate compliance obligations under
this title for each gas designated as a greenhouse gas under
paragraph (4).
``(c) Petitions to Designate a Greenhouse Gas.--
``(1) In general.--Any person may petition the
Administrator to designate as a greenhouse gas any
anthropogenic gas 1 metric ton of which makes the same or
greater contribution to global warming over 100 years as 1
metric ton of carbon dioxide.
``(2) Contents of petition.--The petitioner shall provide
sufficient data, as specified by rule by the Administrator, to
demonstrate that the gas is likely to be designated as a
greenhouse gas and is likely to be produced, imported, used, or
emitted in the United States. To the extent practicable, the
petitioner shall also identify producers, importers,
distributors, users, and emitters of the gas in the United
States.
``(3) Review and action by the administrator.--Not later
than 90 days after receipt of a petition under paragraph (2),
the Administrator shall determine whether the petition is
complete and notify the petitioner and the public of the
decision.
``(4) Additional information.--The Administrator may
require producers, importers, distributors, users, or emitters
of the gas to provide information on the contribution of the
gas to global warming over 100 years compared to carbon
dioxide.
``(5) Treatment of petition.--For any substance used as a
substitute for a class I or class II substance under title VI,
the Administrator may elect to treat a petition under this
subsection as a petition to list the substance as a class II,
group II substance under section 619, and may require the
petition to be amended to address listing criteria promulgated
under that section.
``(6) Determination.--Not later than 2 years after receipt
of a complete petition, the Administrator shall, after notice
and an opportunity for comment--
``(A) issue and publish in the Federal Register--
``(i) a determination that 1 metric ton of
the gas does not make a contribution to global
warming over 100 years that is equal to or
greater than that made by 1 metric ton of
carbon dioxide; and
``(ii) an explanation of the decision; or
``(B) determine that 1 metric ton of the gas makes
a contribution to global warming over 100 years that is
equal to or greater than that made by 1 metric ton of
carbon dioxide, and take the actions described in
subsection (b) with respect to such gas.
``(7) Grounds for denial.--The Administrator may not deny a
petition under this subsection solely on the basis of
inadequate Environmental Protection Agency resources or time
for review.
``(d) Science Advisory Board Consultation.--
``(1) Consultation.--The Administrator shall--
``(A) give notice to the Science Advisory Board
prior to making a determination under subsection
(b)(1), (c)(6), or (e)(2)(B);
``(B) consider the written recommendations of the
Science Advisory Board under paragraph (2) regarding
the determination; and
``(C) consult with the Science Advisory Board
regarding such determination, including consultation
subsequent to receipt of such written recommendations.
``(2) Formulation of recommendations.--Upon receipt of
notice under paragraph (1)(A) regarding a pending determination
under subsection (b)(1), (c)(6), or (e)(2)(B), the Science
Advisory Board shall--
``(A) formulate recommendations regarding such
determination, subject to a peer review process; and
``(B) submit such recommendations in writing to the
Administrator.
``(e) Manufacturing and Emission Notices.--
``(1) Notice requirement.--
``(A) In general.--Effective 24 months after the
date of enactment of this title, no person may
manufacture or introduce into interstate commerce a
fluorinated gas, or emit a significant quantity, as
determined by the Administrator, of any fluorinated gas
that is generated as a byproduct during the production
or use of another fluorinated gas, unless--
``(i) the gas is designated as a greenhouse
gas under this section or is an ozone-depleting
substance listed as a class I or class II
substance under title VI;
``(ii) the Administrator has determined
that 1 metric ton of such gas does not make a
contribution to global warming over 100 years
that is equal to or greater than that made by 1
metric ton of carbon dioxide; or
``(iii) the person manufacturing or
importing the gas for distribution into
interstate commerce, or emitting the gas, has
submitted to the Administrator, at least 90
days before the start of such manufacture,
introduction into commerce, or emission, a
notice of such person's manufacture,
introduction into commerce, or emission of such
gas, and the Administrator has not determined
that that notice or a substantially similar
notice submitted by that person is incomplete.
``(B) Alternative compliance.--For a gas that is a
substitute for a class I or class II substance under
title VI and either has been listed as acceptable for
use under section 612 or is currently subject to
evaluation under section 612, the Administrator may
accept the notice and information provided pursuant to
that section as fulfilling the obligation under clause
(iii) of subparagraph (A).
``(2) Review and action by the administrator.--
``(A) Completeness.--Not later than 90 days after
receipt of notice under paragraph (1)(A)(iii) or (B),
the Administrator shall determine whether the notice is
complete.
``(B) Determination.--If the Administrator
determines that the notice is complete, the
Administrator shall, after notice and an opportunity
for comment, not later than 12 months after receipt of
the notice--
``(i) issue and publish in the Federal
Register--
``(I) a determination that 1 metric
ton of the gas does not make a
contribution to global warming over 100
years that is equal to or greater than
that made by 1 metric ton of carbon
dioxide; and
``(II) an explanation of the
decision; or
``(ii) determine that 1 metric ton of the
gas makes a contribution to global warming over
100 years that is equal to or greater than that
made by 1 metric ton of carbon dioxide, and
take the actions described in subsection (b)
with respect to such gas.
``(f) Regulations.--Not later than 1 year after the date of
enactment of this title, the Administrator shall promulgate regulations
to carry out this section. Such regulations shall include--
``(1) requirements for the contents of a petition submitted
under subsection (c);
``(2) requirements for the contents of a notice required
under subsection (e); and
``(3) methods and standards for evaluating the carbon
dioxide equivalent value of a gas.
``(g) Gases Regulated Under Title VI.--The Administrator shall not
designate a gas as a greenhouse gas under this section to the extent
that the gas is regulated under title VI.
``(h) Savings Clause.--Nothing in this section shall be interpreted
to relieve any person from complying with the requirements of section
612.
``SEC. 712. CARBON DIOXIDE EQUIVALENT VALUE OF GREENHOUSE GASES.
``(a) Measure of Quantity of Greenhouse Gases.--Any provision of
this title or title VIII that refers to a quantity or percentage of a
quantity of greenhouse gases shall mean the quantity or percentage of
the greenhouse gases expressed in carbon dioxide equivalents.
``(b) Initial Value.--Except as provided by the Administrator under
this section or section 711--
``(1) the carbon dioxide equivalent value of greenhouse
gases for purposes of this Act shall be as follows:
``CARBON DIOXIDE EQUIVALENT OF 1 TON OF LISTED GREENHOUSE GASES
----------------------------------------------------------------------------------------------------------------
Greenhouse gas (1 metric ton) Carbon dioxide equivalent (metric tons)
----------------------------------------------------------------------------------------------------------------
Carbon dioxide 1
----------------------------------------------------------------------------------------------------------------
Methane 25
----------------------------------------------------------------------------------------------------------------
Nitrous oxide 298
----------------------------------------------------------------------------------------------------------------
HFC-23 14,800
----------------------------------------------------------------------------------------------------------------
HFC-125 3,500
----------------------------------------------------------------------------------------------------------------
HFC-134a 1,430
----------------------------------------------------------------------------------------------------------------
HFC-143a 4,470
----------------------------------------------------------------------------------------------------------------
HFC-152a 124
----------------------------------------------------------------------------------------------------------------
HFC-227ea 3,220
----------------------------------------------------------------------------------------------------------------
HFC-236fa 9,810
----------------------------------------------------------------------------------------------------------------
HFC-4310mee 1,640
----------------------------------------------------------------------------------------------------------------
CF4 7,390
----------------------------------------------------------------------------------------------------------------
C2F6 12,200
----------------------------------------------------------------------------------------------------------------
C4F10 8,860
----------------------------------------------------------------------------------------------------------------
C6F14 9,300
----------------------------------------------------------------------------------------------------------------
SF6 22,800
----------------------------------------------------------------------------------------------------------------
NF3 17,200
----------------------------------------------------------------------------------------------------------------
; and
``(2) the carbon dioxide equivalent value for purposes of
this Act for any greenhouse gas not listed in the table under
paragraph (1) shall be the 100-year Global Warming Potentials
provided in the Intergovernmental Panel on Climate Change
Fourth Assessment Report.
``(c) Periodic Review.--
``(1) Not later than February 1, 2017, and (except as
provided in paragraph (3)) not less than every 5 years
thereafter, the Administrator shall--
``(A) review and, if appropriate, revise the carbon
dioxide equivalent values established under this
section or section 711(b)(2), based on a determination
of the number of metric tons of carbon dioxide that
makes the same contribution to global warming over 100
years as 1 metric ton of each greenhouse gas; and
``(B) publish in the Federal Register the results
of that review and any revisions.
``(2) A revised determination published in the Federal
Register under paragraph (1)(B) shall take effect for
greenhouse gas emissions starting on January 1 of the first
calendar year starting at least 9 months after the date on
which the revised determination was published.
``(3) The Administrator may decrease the frequency of
review and revision under paragraph (1) if the Administrator
determines that such decrease is appropriate in order to
synchronize such review and revision with any similar review
process carried out pursuant to the United Nations Framework
Convention on Climate Change, done at New York on May 9, 1992,
or to an agreement negotiated under that convention, except
that in no event shall the Administrator carry out such review
and revision any less frequently than every 10 years.
``(d) Methodology.--In setting carbon dioxide equivalent values,
for purposes of this section or section 711, the Administrator shall
take into account publications by the Intergovernmental Panel on
Climate Change or a successor organization under the auspices of the
United Nations Environmental Programme and the World Meteorological
Organization.
``SEC. 713. GREENHOUSE GAS REGISTRY.
``(a) Definitions.--For purposes of this section:
``(1) Climate registry.--The term `Climate Registry' means
the greenhouse gas emissions registry jointly established and
managed by more than 40 States and Indian tribes in 2007 to
collect high-quality greenhouse gas emission data from
facilities, corporations, and other organizations to support
various greenhouse gas emission reporting and reduction
policies for the member States and Indian tribes.
``(2) Reporting entity.--The term `reporting entity'
means--
``(A) a covered entity;
``(B) an entity that--
``(i) would be a covered entity if it had
emitted, produced, imported, manufactured, or
delivered in 2008 or any subsequent year more
than the applicable threshold level in the
definition of covered entity in paragraph (13)
of section 700; and
``(ii) has emitted, produced, imported,
manufactured, or delivered in 2008 or any
subsequent year more than the applicable
threshold level in the definition of covered
entity in paragraph (13) of section 700,
provided that the figure of 25,000 tons of
carbon dioxide equivalent is read instead as
10,000 tons of carbon dioxide equivalent and
the figure of 460,000,000 cubic feet is read
instead as 184,000,000 cubic feet;
``(C) any other entity that emits a greenhouse gas,
or produces, imports, manufactures, or delivers
material whose use results or may result in greenhouse
gas emissions if the Administrator determines that
reporting under this section by such entity will help
achieve the purposes of this title or title VIII;
``(D) any vehicle fleet with emissions of more than
25,000 tons of carbon dioxide equivalent on an annual
basis, if the Administrator determines that the
inclusion of such fleet will help achieve the purposes
of this title or title VIII; or
``(E) any entity that delivers electricity to a
facility in an energy-intensive industrial sector that
meets the energy or greenhouse gas intensity criteria
in section 764(b)(2)(A)(i).
``(b) Regulations.--
``(1) In general.--Not later than 6 months after the date
of enactment of this title, the Administrator shall issue
regulations establishing a Federal greenhouse gas registry.
Such regulations shall--
``(A) require reporting entities to submit to the
Administrator data on--
``(i) greenhouse gas emissions in the
United States;
``(ii) the production and manufacture in
the United States, importation into the United
States, and, at the discretion of the
Administrator, exportation from the United
States, of fuels and industrial gases the uses
of which result or may result in greenhouse gas
emissions;
``(iii) deliveries in the United States of
natural gas, and any other gas meeting the
specifications for commingling with natural gas
for purposes of delivery, the combustion of
which result or may result in greenhouse gas
emissions; and
``(iv) the capture and sequestration of
greenhouse gases;
``(B) require covered entities and, where
appropriate, other reporting entities to submit to the
Administrator data sufficient to ensure compliance with
or implementation of the requirements of this title;
``(C) require reporting of electricity delivered to
facilities in an energy-intensive industrial sector
that meets the energy or greenhouse gas intensity
criteria in section 764(b)(2)(A)(i);
``(D) ensure the completeness, consistency,
transparency, accuracy, precision, and reliability of
such data;
``(E) take into account the best practices from the
most recent Federal, State, tribal, and international
protocols for the measurement, accounting, reporting,
and verification of greenhouse gas emissions, including
protocols from the Climate Registry and other mandatory
State or multistate authorized programs;
``(F) take into account the latest scientific
research;
``(G) require that, for covered entities with
respect to greenhouse gases to which section 722
applies, and, to the extent determined to be
appropriate by the Administrator, for covered entities
with respect to other greenhouse gases and for other
reporting entities, submitted data are based on--
``(i) continuous monitoring systems for
fuel flow or emissions, such as continuous
emission monitoring systems;
``(ii) alternative systems that are
demonstrated as providing data with the same
precision, reliability, accessibility, and
timeliness, or, to the extent the Administrator
determines is appropriate for reporting small
amounts of emissions, the same precision,
reliability, and accessibility and similar
timeliness, as data provided by continuous
monitoring systems for fuel flow or emissions;
or
``(iii) alternative methodologies that are
demonstrated to provide data with precision,
reliability, accessibility, and timeliness, or,
to the extent the Administrator determines is
appropriate for reporting small amounts of
emissions, precision, reliability, and
accessibility, as similar as is technically
feasible to that of data generally provided by
continuous monitoring systems for fuel flow or
emissions, if the Administrator determines
that, with respect to a reporting entity, there
is no continuous monitoring system or
alternative system described in clause (i) or
(ii) that is technically feasible;
``(H) require that the Administrator, in
determining the extent to which the requirement to use
systems or methodologies in accordance with
subparagraph (G) is appropriate for reporting entities
other than covered entities or for greenhouse gases to
which section 722 does not apply, consider the cost of
using such systems and methodologies, and of using
other systems and methodologies that are available and
suitable, for quantifying the emissions involved in
light of the purposes of this title, including the goal
of collecting consistent entity-wide data;
``(I) include methods for minimizing double
reporting and avoiding irreconcilable double reporting
of greenhouse gas emissions;
``(J) establish measurement protocols for carbon
capture and sequestration systems, taking into
consideration the regulations promulgated under section
813;
``(K) require that reporting entities provide the
data required under this paragraph in reports submitted
electronically to the Administrator, in such form and
containing such information as may be required by the
Administrator;
``(L) include requirements for keeping records
supporting or related to, and protocols for auditing,
submitted data;
``(M) establish consistent policies for calculating
carbon content and greenhouse gas emissions for each
type of fossil fuel with respect to which reporting is
required;
``(N) subsequent to implementation of policies
developed under subparagraph (M), provide for immediate
dissemination, to States, Indian tribes, and on the
Internet, of all data reported under this section as
soon as practicable after electronic audit by the
Administrator and any resulting correction of data,
except that data shall not be disseminated under this
subparagraph if--
``(i) its nondissemination is vital to the
national security of the United States, as
determined by the President; or
``(ii) it is confidential business
information that cannot be derived from
information that is otherwise publicly
available and that would cause significant
calculable competitive harm if published,
except that--
``(I) data relating to greenhouse
gas emissions, including any upstream
or verification data from reporting
entities, shall not be considered to be
confidential business information; and
``(II) data that is confidential
business information shall be provided
to a State or Indian tribe within whose
jurisdiction the reporting entity is
located, if the Administrator
determines that such State or Indian
tribe has in effect protections for
confidential business information that
are at least as protective as
protections applicable to the Federal
Government;
``(O) prescribe methods by which the Administrator
shall, in cases in which satisfactory data are not
submitted to the Administrator for any period of time,
estimate emission, production, importation,
manufacture, or delivery levels--
``(i) for covered entities with respect to
greenhouse gas emissions, production,
importation, manufacture, or delivery regulated
under this title to ensure that emissions,
production, importation, manufacture, or
deliveries are not underreported, and to create
a strong incentive for meeting data monitoring
and reporting requirements--
``(I) with a conservative estimate
of the highest emission, production,
importation, manufacture, or delivery
levels that may have occurred during
the period for which data are missing;
or
``(II) to the extent the
Administrator considers appropriate,
with an estimate of such levels
assuming the unit is emitting,
producing, importing, manufacturing, or
delivering at a maximum potential level
during the period, in order to ensure
that such levels are not underreported
and to create a strong incentive for
meeting data monitoring and reporting
requirements; and
``(ii) for covered entities with respect to
greenhouse gas emissions to which section 722
does not apply and for other reporting
entities, with a reasonable estimate of the
emission, production, importation, manufacture,
or delivery levels that may have occurred
during the period for which data are missing;
``(P) require the designation of a designated
representative for each reporting entity;
``(Q) require an appropriate certification, by the
designated representative for the reporting entity, of
accurate and complete accounting of greenhouse gas
emissions, as determined by the Administrator; and
``(R) include requirements for other data necessary
for accurate and complete accounting of greenhouse gas
emissions, as determined by the Administrator,
including data for quality assurance of monitoring
systems, monitors and other measurement devices, and
other data needed to verify reported emissions,
production, importation, manufacture, or delivery.
``(2) Timing.--
``(A) Calendar years 2007 through 2010.--For a base
period of calendar years 2007 through 2010, each
reporting entity shall submit annual data required
under this section to the Administrator not later than
March 31, 2011. The Administrator may waive or modify
reporting requirements for calendar years 2007 through
2010 for categories of reporting entities to the extent
that the Administrator determines that the reporting
entities did not keep data or records necessary to meet
reporting requirements. The Administrator may, in
addition to or in lieu of such requirements, collect
information on energy consumption and production.
``(B) Subsequent calendar years.--For calendar year
2011 and each subsequent calendar year, each reporting
entity shall submit quarterly data required under this
section to the Administrator not later than 60 days
after the end of the applicable quarter, except when
the data is already being reported to the Administrator
on an earlier timeframe for another program.
``(3) Waiver of reporting requirements.--The Administrator
may waive reporting requirements under this section for
specific entities to the extent that the Administrator
determines that sufficient and equally or more reliable
verified and timely data are available to the Administrator and
the public on the Internet under other mandatory statutory
requirements.
``(4) Alternative threshold.--The Administrator may, by
rule, establish applicability thresholds for reporting under
this section using alternative metrics and levels, provided
that such metrics and levels are easier to administer and cover
the same size and type of sources as the threshold defined in
this section.
``(c) Interrelationship With Other Systems.--In developing the
regulations issued under subsection (b), the Administrator shall take
into account the work done by the Climate Registry and other mandatory
State or multistate programs. Such regulations shall include an
explanation of any major differences in approach between the system
established under the regulations and such registries and programs.
``PART C--PROGRAM RULES
``SEC. 721. EMISSION ALLOWANCES.
``(a) In General.--The Administrator shall establish a separate
quantity of emission allowances for each calendar year starting in
2012, in the amounts prescribed under subsection (e).
``(b) Identification Numbers.--The Administrator shall assign to
each emission allowance established under subsection (a) a unique
identification number that includes the vintage year for that emission
allowance.
``(c) Legal Status of Emission Allowances.--
``(1) In general.--An allowance established by the
Administrator under this title does not constitute a property
right, nor does any offset credit or other instrument
established or issued under the American Clean Energy and
Security Act of 2009, and the amendments made thereby, for the
purpose of demonstrating compliance with this title.
``(2) Termination or limitation.--Nothing in this Act or
any other provision of law shall be construed to limit or alter
the authority of the United States, including the Administrator
acting pursuant to statutory authority, to terminate or limit
allowances, offset credits, or term offset credits.
``(3) Other provisions unaffected.--Except as otherwise
specified in this Act, nothing in this Act relating to
allowances, offset credits, or term offset credits established
or issued under this title shall affect the application of any
other provision of law to a covered entity, or the
responsibility for a covered entity to comply with any such
provision of law.
``(d) Savings Provision.--Nothing in this part shall be construed
as requiring a change of any kind in any State law regulating electric
utility rates and charges, or as affecting any State law regarding such
State regulation, or as limiting State regulation (including any
prudency review) under such a State law. Nothing in this part shall be
construed as modifying the Federal Power Act or as affecting the
authority of the Federal Energy Regulatory Commission under that Act.
Nothing in this part shall be construed to interfere with or impair any
program for competitive bidding for power supply in a State in which
such program is established.
``(e) Allowances for Each Calendar Year.--
``(1) In general.--Except as provided in paragraph (2), the
number of emission allowances established by the Administrator
under subsection (a) for each calendar year shall be as
provided in the following table:
----------------------------------------------------------------------------------------------------------------
``Calendar year Emission allowances (in millions)
----------------------------------------------------------------------------------------------------------------
2012 4,627
----------------------------------------------------------------------------------------------------------------
2013 4,544
----------------------------------------------------------------------------------------------------------------
2014 5,099
----------------------------------------------------------------------------------------------------------------
2015 5,003
----------------------------------------------------------------------------------------------------------------
2016 5,482
----------------------------------------------------------------------------------------------------------------
2017 5,375
----------------------------------------------------------------------------------------------------------------
2018 5,269
----------------------------------------------------------------------------------------------------------------
2019 5,162
----------------------------------------------------------------------------------------------------------------
2020 5,056
----------------------------------------------------------------------------------------------------------------
2021 4,903
----------------------------------------------------------------------------------------------------------------
2022 4,751
----------------------------------------------------------------------------------------------------------------
2023 4,599
----------------------------------------------------------------------------------------------------------------
2024 4,446
----------------------------------------------------------------------------------------------------------------
2025 4,294
----------------------------------------------------------------------------------------------------------------
2026 4,142
----------------------------------------------------------------------------------------------------------------
2027 3,990
----------------------------------------------------------------------------------------------------------------
2028 3,837
----------------------------------------------------------------------------------------------------------------
2029 3,685
----------------------------------------------------------------------------------------------------------------
2030 3,533
----------------------------------------------------------------------------------------------------------------
2031 3,408
----------------------------------------------------------------------------------------------------------------
2032 3,283
----------------------------------------------------------------------------------------------------------------
2033 3,158
----------------------------------------------------------------------------------------------------------------
2034 3,033
----------------------------------------------------------------------------------------------------------------
2035 2,908
----------------------------------------------------------------------------------------------------------------
2036 2,784
----------------------------------------------------------------------------------------------------------------
2037 2,659
----------------------------------------------------------------------------------------------------------------
2038 2,534
----------------------------------------------------------------------------------------------------------------
2039 2,409
----------------------------------------------------------------------------------------------------------------
2040 2,284
----------------------------------------------------------------------------------------------------------------
2041 2,159
----------------------------------------------------------------------------------------------------------------
2042 2,034
----------------------------------------------------------------------------------------------------------------
2043 1,910
----------------------------------------------------------------------------------------------------------------
2044 1,785
----------------------------------------------------------------------------------------------------------------
2045 1,660
----------------------------------------------------------------------------------------------------------------
2046 1,535
----------------------------------------------------------------------------------------------------------------
2047 1,410
----------------------------------------------------------------------------------------------------------------
2048 1,285
----------------------------------------------------------------------------------------------------------------
2049 1,160
----------------------------------------------------------------------------------------------------------------
2050 and each year thereafter 1,035
----------------------------------------------------------------------------------------------------------------
``(2) Revision.--
``(A) In general.--The Administrator may adjust, in
accordance with subparagraph (B), the number of
emission allowances established pursuant to paragraph
(1) if, after notice and an opportunity for public
comment, the Administrator determines that--
``(i) United States greenhouse gas
emissions in 2005 were other than 7,206 million
metric tons carbon dioxide equivalent;
``(ii) if the requirements of this title
for 2012 had been in effect in 2005, section
722 would have required emission allowances to
be held for other than 66.2 percent of United
States greenhouse gas emissions in 2005;
``(iii) if the requirements of this title
for 2014 had been in effect in 2005, section
722 would have required emission allowances to
be held for other than 75.7 percent of United
States greenhouse gas emissions in 2005; or
``(iv) if the requirements of this title
for 2016 had been in effect in 2005, section
722 would have required emission allowances to
be held for other than 84.5 percent United
States greenhouse gas emissions in 2005.
``(B) Adjustment formula.--
``(i) In general.--If the Administrator
adjusts under this paragraph the number of
emission allowances established pursuant to
paragraph (1), the number of emission
allowances the Administrator establishes for
any given calendar year shall equal the product
of--
``(I) United States greenhouse gas
emissions in 2005, expressed in tons of
carbon dioxide equivalent;
``(II) the percent of United States
greenhouse gas emissions in 2005,
expressed in tons of carbon dioxide
equivalent, that would have been
subject to section 722 if the
requirements of this title for the
given calendar year had been in effect
in 2005; and
``(III) the percentage set forth
for that calendar year in section
703(a), or determined under clause (ii)
of this subparagraph.
``(ii) Targets.--In applying the portion of
the formula in clause (i)(III) of this
subparagraph, for calendar years for which a
percentage is not listed in section 703(a), the
Administrator shall use a uniform annual
decline in the amount of emissions between the
years that are specified.
``(iii) Carbon dioxide equivalent value.--
If the Administrator adjusts under this
paragraph the number of emission allowances
established pursuant to paragraph (1), the
Administrator shall use the carbon dioxide
equivalent values established pursuant to
section 712.
``(iv) Limitation on adjustment timing.--
Once a calendar year has started, the
Administrator may not adjust the number of
emission allowances to be established for that
calendar year.
``(C) Limitation on adjustment authority.--The
Administrator may adjust under this paragraph the
number of emission allowances to be established
pursuant to paragraph (1) only once.
``(f) Compensatory Allowance.--
``(1) In general.--The regulations promulgated under
subsection (h) shall provide for the establishment and
distribution of compensatory allowances for--
``(A) the destruction, in 2012 or later, of
fluorinated gases that are greenhouse gases if--
``(i) allowances or offset credits were
retired for their production or importation;
and
``(ii) such gases are not required to be
destroyed under any other provision of law;
``(B) the nonemissive use, in 2012 or later, of
petroleum-based or coal-based liquid or gaseous fuel,
petroleum coke, natural gas liquid, or natural gas as a
feedstock, if allowances or offset credits were retired
for the greenhouse gases that would have been emitted
from their combustion; and
``(C) the conversionary use, in 2012 or later, of
fluorinated gases in a manufacturing process, including
semiconductor research or manufacturing, if allowances
or offset credits were retired for the production or
importation of such gas.
``(2) Establishment and distribution.--
``(A) In general.--Not later than 90 days after the
end of each calendar year, the Administrator shall
establish and distribute to the entity taking the
actions described in subparagraph (A), (B), or (C) of
paragraph (1) a quantity of compensatory allowances
equivalent to the number of tons of carbon dioxide
equivalent of avoided emissions achieved through such
actions. In establishing the quantity of compensatory
allowances, the Administrator shall take into account
the carbon dioxide equivalent value of any greenhouse
gas resulting from such action.
``(B) Source of allowances.--Compensatory
allowances established under this subsection shall not
be emission allowances established under subsection
(a).
``(C) Identification numbers.--The Administrator
shall assign to each compensatory allowance established
under subparagraph (A) a unique identification number.
``(3) Definitions.--For purposes of this subsection--
``(A) the term `destruction' means the conversion
of a greenhouse gas by thermal, chemical, or other
means to another gas or set of gases with little or no
carbon dioxide equivalent value;
``(B) the term `nonemissive use' means the use of
fossil fuel as a feedstock in an industrial or
manufacturing process to the extent that greenhouse
gases are not emitted from such process, and to the
extent that the products of such process are not
intended for use as, or to be contained in, a fuel; and
``(C) the term `conversionary use' means the
conversion during research or manufacturing of a
fluorinated gas into another greenhouse gas or set of
gases with a lower carbon dioxide equivalent value.
``(4) Feedstock emissions study.--
``(A) The Administrator may conduct a study to
determine the extent to which petroleum-based or coal-
based liquid or gaseous fuel, petroleum coke, natural
gas liquid, or natural gas are used as feedstocks in
manufacturing processes to produce products and the
greenhouse gas emissions resulting from such uses.
``(B) If as a result of such a study, the
Administrator determines that the use of such products
by noncovered sources results in substantial emissions
of greenhouse gases and that such emissions have not
been adequately addressed under other requirements of
this Act, the Administrator may, after notice and
comment rulemaking, promulgate a regulation reducing
compensatory allowances commensurately if doing so will
not result in shifting such emissions to noncovered
sources.
``(g) Fluorinated Gases Assessment.--No later than March 31, 2014,
the Administrator shall complete an assessment of the regulation of
non-HFC fluorinated gases under this title to determine whether the
most appropriate point of regulation is at the gas manufacturer or
importer level, or at the source of emissions downstream. If the
Administrator determines, based on consideration of environmental
effectiveness, cost effectiveness, administrative feasibility, extent
of coverage of emissions, competitiveness and other relevant
considerations consistent with the purposes of this title, that
emissions of non-HFC fluorinated gases can best be regulated by
designating downstream emission sources as covered entities with
compliance obligations under section 722, the Administrator shall,
after notice and comment rulemaking, change the definition of covered
entity and the compliance obligations under section 722 with respect to
non-HFC fluorinated gases accordingly, consistent with the purposes of
this title, and establish such other requirements as are necessary to
ensure compliance for such entities with the requirements of this
title.
``(h) Regulations.--Not later than 24 months after the date of
enactment of this title, the Administrator shall promulgate regulations
to carry out the provisions of this title.
``SEC. 722. PROHIBITION OF EXCESS EMISSIONS.
``(a) Prohibition.--Except as provided in subsection (c), effective
January 1, 2012, each covered entity is prohibited from emitting
greenhouse gases and having attributable greenhouse gas emissions, in
combination, in excess of its allowable emissions level. A covered
entity's allowable emissions level for each calendar year is the number
of emission allowances (or offset credits or other allowances as
provided in subsection (d)) it holds as of 12:01 a.m. on April 1 (or a
later date established by the Administrator under subsection (j)) of
the following calendar year.
``(b) Methods of Demonstrating Compliance.--Except as otherwise
provided in this section, the owner or operator of a covered entity
shall not be considered to be in compliance with the prohibition in
subsection (a) unless, as of 12:01 a.m. on April 1 (or a later date
established by the Administrator under subsection (j)) of each calendar
year starting in 2013, the owner or operator holds a quantity of
emission allowances (or offset credits or other allowances as provided
in subsection (d)) at least as great as the quantity calculated as
follows:
``(1) Electricity sources.--For a covered entity described
in section 700(13)(A), 1 emission allowance for each ton of
carbon dioxide equivalent of greenhouse gas that such covered
entity emitted in the previous calendar year, excluding
emissions resulting from the combustion of--
``(A) petroleum-based or coal-based liquid fuel;
``(B) natural gas liquid;
``(C) renewable biomass or gas derived from
renewable biomass; or
``(D) petroleum coke or gas derived from petroleum
coke.
``(2) Fuel producers and importers.--For a covered entity
described in section 700(13)(B), 1 emission allowance for each
ton of carbon dioxide equivalent of greenhouse gas that would
be emitted from the combustion of any petroleum-based or coal-
based liquid fuel, petroleum coke, or natural gas liquid,
produced or imported by such covered entity during the previous
calendar year for sale or distribution in interstate commerce,
assuming no capture and sequestration of any greenhouse gas
emissions.
``(3) Industrial gas producers and importers.--For a
covered entity described in section 700(13)(C), 1 emission
allowance for each ton of carbon dioxide equivalent of fossil
fuel-based carbon dioxide, nitrous oxide, or any other
fluorinated gas that is a greenhouse gas (except for nitrogen
trifluoride), or any combination thereof, produced or imported
by such covered entity during the previous calendar year for
sale or distribution in interstate commerce.
``(4) Nitrogen trifluoride sources.--For a covered entity
described in section 700(13)(D), 1 emission allowance for each
ton of carbon dioxide equivalent of nitrogen trifluoride that
such covered entity emitted in the previous calendar year.
``(5) Geological sequestration sites.--For a covered entity
described in section 700(13)(E), 1 emission allowance for each
ton of carbon dioxide equivalent of greenhouse gas that such
covered entity emitted in the previous calendar year.
``(6) Industrial stationary sources.--For a covered entity
described in section 700(13)(F), (G), or (H), 1 emission
allowance for each ton of carbon dioxide equivalent of
greenhouse gas that such covered entity emitted in the previous
calendar year, excluding emissions resulting from--
``(A) the combustion of petroleum-based or coal-
based liquid fuel;
``(B) the combustion of natural gas liquid;
``(C) the combustion of renewable biomass or gas
derived from renewable biomass;
``(D) the combustion of petroleum coke or gas
derived from petroleum coke; or
``(E) the use of any fluorinated gas that is a
greenhouse gas purchased for use at that covered
entity, except for nitrogen trifluoride.
``(7) Industrial fossil fuel-fired combustion devices.--For
a covered entity described in section 700(13)(I), 1 emission
allowance for each ton of carbon dioxide equivalent of
greenhouse gas that the devices emitted in the previous
calendar year, excluding emissions resulting from the
combustion of--
``(A) petroleum-based or coal-based liquid fuel;
``(B) natural gas liquid;
``(C) renewable biomass or gas derived from
renewable biomass; or
``(D) petroleum coke or gas derived from petroleum
coke.
``(8) Natural gas local distribution companies.--For a
covered entity described in section 700(13)(J), 1 emission
allowance for each ton of carbon dioxide equivalent of
greenhouse gas that would be emitted from the combustion of the
natural gas, and any other gas meeting the specifications for
commingling with natural gas for purposes of delivery, that
such entity delivered during the previous calendar year to
customers that are not covered entities, assuming no capture
and sequestration of that greenhouse gas.
``(9) Algae-based fuels.--Where carbon dioxide (or another
greenhouse gas) generated by a covered entity is used as an
input in the production of algae-based fuels, the Administrator
shall ensure that emission allowances are required to be held
either for the carbon dioxide generated by a covered entity
that is used to grow the algae or for the portion of the carbon
dioxide emitted from combustion of the fuel produced from such
algae that is attributable to carbon dioxide generated by a
covered entity, but not for both.
``(10) Fugitive emissions.--The greenhouse gas emissions to
which paragraphs (1), (4), (6), and (7) apply shall not include
fugitive emissions of greenhouse gas, except to the extent the
Administrator determines that data on the carbon dioxide
equivalent value of greenhouse gas in the fugitive emissions
can be provided with sufficient precision, reliability,
accessibility, and timeliness to ensure the integrity of
emission allowances, the allowance tracking system, and the cap
on emissions.
``(11) Export exemption.--This section shall not apply to
any petroleum-based or coal-based liquid fuel, petroleum coke,
natural gas liquid, fossil fuel-based carbon dioxide, nitrous
oxide, or fluorinated gas that is exported for sale or use.
``(12) Natural gas liquids.--For natural gas liquids, the
covered entity subject to the requirement stated in paragraph
(2) shall be the owner of the natural gas liquids at the point
the natural gas liquids are separated into merchantable
products.
``(13) Application of multiple paragraphs.--For a covered
entity to which more than 1 of paragraphs (1) through (8)
apply, all applicable paragraphs shall apply, except that not
more than 1 emission allowance shall be required for the same
emission.
``(14) Application to fractions of tons.--In applying
paragraphs (1) through (8), any amount less than 1 ton of
carbon dioxide equivalent of emissions or attributable
greenhouse gas emissions shall be treated as 1 ton of such
carbon dioxide equivalent.
``(c) Phase-in of Prohibition.--
``(1) Industrial stationary sources.--The prohibition under
subsection (a) shall first apply to a covered entity described
in section 700(13)(D), (F), (G), (H), or (I), with respect to
emissions occurring during calendar year 2014.
``(2) Natural gas local distribution companies.--The
prohibition under subsection (a) shall first apply to a covered
entity described in section 700(13)(J) with respect to
deliveries occurring during calendar year 2016.
``(d) Additional Methods.--In addition to using the method of
compliance described in subsection (b), a covered entity may do the
following:
``(1) Offset credits.--
``(A) In general.--Covered entities collectively
may, in accordance with this paragraph, use offset
credits to demonstrate compliance for up to a maximum
of 2 billion tons of greenhouse gas emissions annually.
The ability to demonstrate compliance with offset
credits shall be divided pro rata among covered
entities by allowing each covered entity to satisfy a
percentage of the number of allowances required to be
held under subsection (b) to demonstrate compliance by
holding 1 domestic offset credit or 1.25 international
offset credits in lieu of an emission allowance, except
as provided in subparagraph (D).
``(B) Applicable percentage.--The percentage
referred to in subparagraph (A) for a given calendar
year shall be determined by dividing 2 billion by the
sum of 2 billion plus the number of emission allowances
established under section 721(a) for the previous year,
and multiplying that number by 100. Not more than one
half of the applicable percentage under this paragraph
may be used by holding domestic offset credits, and not
more than one half of the applicable percentage under
this paragraph may be used by holding international
offset credits, except as provided in subparagraph (C).
``(C) Modified percentages.--If the Administrator
determines that domestic offset credits available for
use in demonstrating compliance in any calendar year at
domestic offset prices generally equal to or less than
emission allowance prices, are likely to offset less
than 0.9 billion tons of greenhouse gas emissions
(measured in tons of carbon dioxide equivalents), for
purposes of compliance demonstration in that year the
Administrator shall--
``(i) increase the percentage of emissions
that can be offset through the use of
international offset credits to reflect the
amount that 1.0 billion exceeds the number of
domestic offset credits the Administrator
determines is available, at prices generally
equal to or less than emission allowance
prices, for that year, up to a maximum of 0.5
billion tons of greenhouse gas emissions; and
``(ii) decrease the percentage of emissions
that can be offset through the use of domestic
offset credits by the same amount.
``(D) International offset credits.--
Notwithstanding subparagraph (A), to demonstrate
compliance prior to calendar year 2018, a covered
entity may use 1 international offset credit in lieu of
an emission allowance up to the amount permitted under
this paragraph.
``(E) President's recommendation.--The President
may make a recommendation to Congress as to whether the
number 2 billion specified in subparagraphs (A) and (B)
should be increased or decreased.
``(2) Term offset credits.--
``(A) In general.--Covered entities may, in
accordance with this paragraph, use non-expired term
offset credits instead of domestic offset credits for
purposes of temporarily demonstrating compliance with
this section.
``(B) Amount.--The combined quantity of term offset
credits and domestic offset credits used by a covered
entity to demonstrate compliance for its emissions or
attributable greenhouse gas emissions in any given year
shall not exceed the quantity of domestic offset
credits that a covered entity is entitled to use for
that year to demonstrate compliance in accordance with
paragraph (1).
``(C) Expiration.--A term offset credit shall
expire in the year after its term ends. The term of a
term offset credit shall be calculated by adding to the
year of issuance the number of years equal to the
length of the crediting period for the practice or
project for which the term offset credit was issued,
but in no case shall be later than the date 5 years
from the date of issuance.
``(D) Demonstrating compliance upon expiration of
term offset credit.--With respect to the emissions for
which a covered entity is using term offset credits to
demonstrate compliance temporarily with this section,
the owner or operator of a covered entity shall not be
considered to be in compliance with the prohibition in
subsection (a) unless, as of 12:01 a.m. on April 1 (or
a later date established by the Administrator under
subsection (j)) of the calendar year in which a term
offset credit expires, the owner or operator holds--
``(i) for purposes of finally demonstrating
compliance, an allowance or a domestic offset
credit; or
``(ii) for purposes of temporarily
demonstrating compliance, a non-expired term
offset credit.
Domestic offset credits used for purposes of finally
demonstrating compliance under this subparagraph shall
not be subject to the percentage limitations in
subparagraph (B).
``(E) Financial assurance.--A covered entity may
not use a term offset credit to demonstrate compliance
temporarily unless it simultaneously provides to the
Administrator financial assurance that, at the end of
the term offset credit's crediting term, the covered
entity will have sufficient resources to obtain the
quantity of allowances or credits necessary to
demonstrate final compliance. The Administrator shall
issue regulations establishing requirements for such
financial assurance, which shall take into account the
increased risk associated with longer crediting terms.
These regulations shall take into account the total
number of tons of carbon dioxide equivalent of
greenhouse gas emissions for which a covered entity is
demonstrating compliance temporarily, and may set a
limit on this amount. In the event that a covered
entity that used term offset credits to demonstrate
compliance temporarily fails to meet the requirements
of subparagraph (D) at the end of the term offset
credits' crediting term, if the financial assurance
mechanism fails to provide to the Administrator the
number of allowances or offset credits for which the
crediting term has expired, then the Administrator
shall retire that number of allowances with the vintage
year 2 years after the year in which the term offset
credit expires in the same amount. Allowances so
retired shall not be counted as emission allowances
established for that calendar year under section
721(a).
``(3) International emission allowances.--To demonstrate
compliance, a covered entity may hold an international emission
allowance in lieu of an emission allowance, except as modified
under section 728(d).
``(4) Compensatory allowances.--To demonstrate compliance,
a covered entity may hold a compensatory allowance obtained
under section 721(f) in lieu of an emission allowance.
``(e) Retirement of Allowances and Credits.--As soon as practicable
after a deadline established for covered entities to demonstrate
compliance with this title, the Administrator shall retire the quantity
of allowances or credits required to be held under this title.
``(f) Alternative Metrics.--For categories of covered entities
described in subparagraph (B), (C), (D), (G), (H), or (I) of section
700(13), the Administrator may, by rule, establish an applicability
threshold for inclusion under those subparagraphs using an alternative
metric and level, provided that such metric and level are easier to
administer and cover the same size and type of sources as the threshold
defined in such subparagraphs.
``(g) Threshold Review.--For each category of covered entities
described in subparagraph (B), (C), (D), (G), (H), or (I) of section
700(13), the Administrator shall, in 2020 and once every 8 years
thereafter, review the carbon dioxide equivalent emission threshold
that is used to define covered entities in such category. After
consideration of--
``(1) emissions from covered entities in such category, and
from other entities of the same type that emit less than the
threshold amount for the category (including emission sources
that commence operation after the date of enactment of this
title that are not covered entities); and
``(2) whether greater greenhouse gas emission reductions
can be cost-effectively achieved by lowering the applicable
threshold,
the Administrator may by rule lower such threshold to not less than
10,000 tons of carbon dioxide equivalent emissions. In determining the
cost effectiveness of potential reductions from lowering the threshold
for covered entities, the Administrator shall consider alternative
regulatory greenhouse gas programs, including setting standards under
other titles of this Act.
``(h) Designated Representatives.--The regulations promulgated
under section 721(h) shall require that each covered entity, and each
entity holding allowances or offset credits or receiving allowances or
offset credits from the Administrator under this title, submit to the
Administrator a certificate of representation designating a designated
representative.
``(i) Education and Outreach.--
``(1) In general.--The Administrator shall establish and
carry out a program of education and outreach to assist covered
entities, especially entities having little experience with
environmental regulatory requirements similar or comparable to
those under this title, in preparing to meet the compliance
obligations of this title. Such program shall include education
with respect to using markets to effectively achieve such
compliance.
``(2) Failure to receive information.--A failure to receive
information or assistance under this subsection may not be used
as a defense against an allegation of any violation of this
title.
``(j) Adjustment of Deadline.--The Administrator may, by rule,
establish a deadline for demonstrating compliance, for a calendar year,
later than the date provided in subsection (a), as necessary to ensure
the availability of emissions data, but in no event shall the deadline
be later than June 1.
``(k) Notice Requirement for Covered Entities Receiving Natural Gas
From Natural Gas Local Distribution Companies.--The owner or operator
of a covered entity that takes delivery of natural gas from a natural
gas local distribution company shall, not later than September 1 of
each calendar year, notify such natural gas local distribution company
in writing that such entity will qualify as a covered entity under this
title for that calendar year.
``(l) Compliance Obligation.--For purposes of this title, the year
of a compliance obligation is the year in which compliance is
determined, not the year in which the greenhouse gas emissions occur or
the covered entity has attributable greenhouse gas emissions.
``SEC. 723. PENALTY FOR NONCOMPLIANCE.
``(a) Enforcement.--A violation of any prohibition of, requirement
of, or regulation promulgated pursuant to this title shall be a
violation of this Act. It shall be a violation of this Act for a
covered entity to emit greenhouse gases and have attributable
greenhouse gas emissions, in combination, in excess of its allowable
emissions level as provided in section 722(a). Each ton of carbon
dioxide equivalent for which a covered entity fails to demonstrate
compliance under section 722 shall be a separate violation. In the
event that a covered entity fails to demonstrate compliance at the
expiration of a term offset credit's crediting term as required by
section 722(d)(2)(D), the year of the violation shall be the year in
which the term offset credit expires.
``(b) Excess Emissions Penalty.--
``(1) In general.--The owner or operator of any covered
entity that fails for any year to comply, on the deadline
described in section 722(a), (d)(2), or (j), shall be liable
for payment to the Administrator of an excess emissions penalty
in the amount described in paragraph (2).
``(2) Amount.--The amount of an excess emissions penalty
required to be paid under paragraph (1) shall be equal to the
product obtained by multiplying--
``(A) the tons of carbon dioxide equivalent of
greenhouse gas emissions or attributable greenhouse gas
emissions for which the owner or operator of a covered
entity failed to demonstrate compliance under section
722 on the deadline; by
``(B) twice the auction clearing price for the
earliest vintage year emission allowances in the last
auction carried out pursuant to section 791 before such
deadline.
``(3) Timing.--An excess emissions penalty required under
this subsection shall be immediately due and payable to the
Administrator, without demand, in accordance with regulations
promulgated by the Administrator, which shall be issued not
later than 2 years after the date of enactment of this title.
``(4) No effect on liability.--An excess emissions penalty
due and payable by the owners or operators of a covered entity
under this subsection shall not diminish the liability of the
owners or operators for any fine, penalty, or assessment
against the owners or operators for the same violation under
any other provision of this Act or any other law.
``(c) Excess Emissions Allowances.--The owner or operator of a
covered entity that fails for any year to comply on the deadline
described in section 722(a), (d)(2), or (j) shall be liable to offset
the covered entity's excess combination of greenhouse gases emitted and
attributable greenhouse gas emissions by an equal quantity of emission
allowances during the following calendar year, or such longer period as
the Administrator may prescribe. During the year in which the covered
entity failed to comply, or any year thereafter, the Administrator may
deduct the emission allowances required under this subsection to offset
the covered entity's excess greenhouse gas emissions or attributable
greenhouse gas emissions.
``SEC. 724. TRADING.
``(a) Permitted Transactions.--Except as otherwise provided in this
title, the lawful holder of an emission allowance, compensatory
allowance, or offset credit may, without restriction, sell, exchange,
transfer, hold for compliance in accordance with section 722, or
request that the Administrator retire the emission allowance,
compensatory allowance, or offset credit.
``(b) No Restriction on Transactions.--The privilege of purchasing,
holding, selling, exchanging, transferring, and requesting retirement
of emission allowances, compensatory allowances, or offset credits
shall not be restricted to the owners and operators of covered
entities, except as otherwise provided in this title.
``(c) Effectiveness of Allowance Transfers.--No transfer of an
allowance, offset credit, or term offset credit shall be effective for
purposes of this title until a certification of the transfer, signed by
the designated representative of the transferor, is received and
recorded by the Administrator in accordance with regulations
promulgated under section 721(h).
``(d) Allowance Tracking System.--The regulations promulgated under
section 721(h) shall include a system for issuing, recording, holding,
and tracking allowances, offset credits, and term offset credits that
shall specify all necessary procedures and requirements for an orderly
and competitive functioning of the allowance and offset credit markets.
Such regulations shall provide for appropriate publication of the
information in the system on the Internet.
``SEC. 725. BANKING AND BORROWING.
``(a) Banking.--An emission allowance may be used to comply with
section 722 or section 723 for emissions in--
``(1) the vintage year for the allowance; or
``(2) any calendar year subsequent to the vintage year for
the allowance.
``(b) Expiration.--
``(1) Regulations.--The Administrator may establish by
regulation criteria and procedures for determining whether, and
for implementing a determination that, the expiration of an
allowance, offset credit, or term offset credit, established or
issued under the American Clean Energy and Security Act of 2009
or the amendments made thereby, or expiration of the ability to
use an international emission allowance to comply with section
722, is necessary to ensure the authenticity and integrity of
allowances, offset credits, or term offset credits or the
allowance tracking system.
``(2) General rule.--An allowance, offset credit, or term
offset credit, established or issued under the American Clean
Energy and Security Act of 2009 or the amendments made thereby,
shall not expire unless--
``(A) it is retired by the Administrator pursuant
to this title; or
``(B) it is determined to expire or to have expired
by a specific date by the Administrator in accordance
with regulations promulgated under paragraph (1).
``(3) International emission allowances.--The ability to
use an international emission allowance to comply with section
722 shall not expire unless--
``(A) the allowance is retired by the Administrator
pursuant to this title; or
``(B) the ability to use such allowance to meet
such compliance obligation requirements is determined
to expire or to have expired by a specific date by the
Administrator in accordance with regulations
promulgated under paragraph (1).
``(c) Borrowing Future Vintage Year Allowances.--
``(1) Borrowing without interest.--In addition to the uses
described in subsection (a), an emission allowance may be used
to demonstrate compliance under section 722 or comply with
section 723 for emissions, production, importation,
manufacture, or deliveries in the calendar year immediately
preceding the vintage year for the allowance.
``(2) Borrowing with interest.--
``(A) In general.--A covered entity may demonstrate
compliance under section 722 in a specific calendar
year for up to 15 percent of its emissions by holding
emission allowances with a vintage year 1 to 5 years
later than that calendar year.
``(B) Limitations.--An emission allowance borrowed
pursuant to this paragraph shall be an emission
allowance that is established by the Administrator for
a specific future calendar year under section 721(a)
and that is held by the borrower.
``(C) Prepayment of interest.--For each emission
allowance that an owner or operator of a covered entity
borrows pursuant to this paragraph, such owner or
operator shall, at the time it borrows the allowance,
hold for retirement by the Administrator, and the
Administrator shall retire, a quantity of emission
allowances that is equal to the product obtained by
multiplying--
``(i) 0.08; by
``(ii) the number of years between the
calendar year in which the allowance is being
used to satisfy a compliance obligation and the
vintage year of the allowance.
``SEC. 726. STRATEGIC RESERVE.
``(a) Strategic Reserve Auctions.--
``(1) In general.--Once each quarter of each calendar year
for which allowances are established under section 721(a), the
Administrator shall auction strategic reserve allowances.
``(2) Restriction to covered entities.--In each auction
conducted under paragraph (1), only covered entities that the
Administrator expects will be required to comply with section
722 in the following calendar year shall be eligible to make
purchases.
``(b) Pool of Emission Allowances for Strategic Reserve Auctions.--
``(1) Filling the strategic reserve initially.--
``(A) In general.--The Administrator shall, not
later than 2 years after the date of enactment of this
title, establish a strategic reserve account, and shall
place in that account an amount of emission allowances
established under section 721(a) for each calendar year
from 2012 through 2050 in the amounts specified in
subparagraph (B) of this paragraph.
``(B) Amount.--The amount referred to in
subparagraph (A) shall be--
``(i) for each of calendar years 2012
through 2019, 1 percent of the quantity of
emission allowances established for that year
pursuant to section 721(e)(1);
``(ii) for each of calendar years 2020
through 2029, 2 percent of the quantity of
emission allowances established for that year
pursuant to section 721(e)(1); and
``(iii) for each of calendar years 2030
through 2050, 3 percent of the quantity of
emission allowances established for that year
pursuant to section 721(e)(1).
``(C) Effect on other provisions.--Any provision in
this title (except for subparagraph (B) of this
paragraph) that refers to a quantity or percentage of
the emission allowances established for a calendar year
under section 721(a) shall be considered to refer to
the amount of emission allowances as determined
pursuant to section 721(e), less any emission
allowances established for that year that are placed in
the strategic reserve account under this paragraph.
``(2) Supplementing the strategic reserve.--The
Administrator shall also--
``(A) at the end of each calendar year, transfer to
the strategic reserve account each emission allowance
that was offered for sale but not sold at any auction
conducted under section 791; and
``(B) deposit emission allowances established under
subsection (g) from auction proceeds into the strategic
reserve, to the extent necessary to maintain the
reserve at its original size.
``(c) Minimum Strategic Reserve Auction Price.--
``(1) In general.--At each strategic reserve auction, the
Administrator shall offer emission allowances for sale
beginning at a minimum price per emission allowance, which
shall be known as the `minimum strategic reserve auction
price'.
``(2) Initial minimum strategic reserve auction prices.--
The minimum strategic reserve auction price shall be $28 (in
constant 2009 dollars) for the strategic reserve auctions held
in 2012. For the strategic reserve auctions held in 2013 and
2014, the minimum strategic reserve auction price shall be the
strategic reserve auction price for the previous year increased
by 5 percent plus the rate of inflation (as measured by the
Consumer Price Index for All Urban Consumers).
``(3) Minimum strategic reserve auction price in subsequent
years.--For each strategic reserve auction held in 2015 and
each year thereafter, the minimum strategic reserve auction
price shall be 60 percent above a rolling 36-month average of
the daily closing price for that year's emission allowance
vintage as reported on registered carbon trading facilities,
calculated using constant dollars.
``(d) Quantity of Emission Allowances Released From the Strategic
Reserve.--
``(1) Initial limits.--For each of calendar years 2012
through 2016, the annual limit on the number of emission
allowances from the strategic reserve account that may be
auctioned is an amount equal to 5 percent of the emission
allowances established for that calendar year under section
721(a). This limit does not apply to international offset
credits sold on consignment pursuant to subsection (h).
``(2) Limits in subsequent years.--For calendar year 2017
and each year thereafter, the annual limit on the number of
emission allowances from the strategic reserve account that may
be auctioned is an amount equal to 10 percent of the emission
allowances established for that calendar year under section
721(a). This limit does not apply to international offset
credits sold on consignment pursuant to subsection (h).
``(3) Allocation of limitation.--One-fourth of each year's
annual strategic reserve auction limit under this subsection
shall be made available for auction in each quarter. Any
allowances from the strategic reserve account that are made
available for sale in a quarterly auction and not sold shall be
rolled over and added to the quantity available for sale in the
following quarter, except that allowances not sold at auction
in the fourth quarter of a year shall not be rolled over to the
following calendar year's auctions, but shall be returned to
the strategic reserve account.
``(e) Purchase Limit.--
``(1) In general.--Except as provided in paragraph (2) or
(3), the annual number of emission allowances that a covered
entity may purchase at the strategic reserve auctions in each
calendar year shall not exceed 20 percent of the covered
entity's combined greenhouse gas emissions and attributable
greenhouse gas emissions during the most recent year for which
allowances or offset credits were retired under section 722.
``(2) 2012 limit.--For calendar year 2012, the maximum
aggregate number of emission allowances that a covered entity
may purchase from that year's strategic reserve auctions shall
be 20 percent of the covered entity's combined greenhouse gas
emissions and attributable greenhouse gas emissions that the
covered entity reported to the registry established under
section 713 for 2011 and that would be subject to section
722(a) if occurring in later calendar years.
``(3) New entrants.--The Administrator shall, by
regulation, establish a separate purchase limit applicable to
entities that expect to become a covered entity in the year of
the auction, permitting them to purchase emission allowances at
the strategic reserve auctions in their first calendar year of
operation in an amount of at least 20 percent of their expected
combined greenhouse gas emissions and attributable greenhouse
gas emissions for that year.
``(f) Delegation or Contract.--Pursuant to regulations under this
section, the Administrator may, by delegation or contract, provide for
the conduct of strategic reserve auctions under the Administrator's
supervision by other departments or agencies of the Federal Government
or by nongovernmental agencies, groups, or organizations.
``(g) Use of Auction Proceeds.--
``(1) Deposit in strategic reserve fund.--The proceeds from
strategic reserve auctions shall be placed in the Strategic
Reserve Fund established under section 793(1), and shall be
available without further appropriation or fiscal year
limitation for the purposes described in this subsection.
``(2) International offset credits for reduced
deforestation.--The Administrator shall use the proceeds from
each strategic reserve auction to purchase international offset
credits issued for reduced deforestation activities pursuant to
section 743(e). The Administrator shall retire those
international offset credits and establish a number of emission
allowances equal to 80 percent of the number of international
offset credits so retired. Emission allowances established
under this paragraph shall be in addition to those established
under section 721(a).
``(3) Emission allowances.--The Administrator shall deposit
emission allowances established under paragraph (2) in the
strategic reserve, except that, with respect to any such
emission allowances in excess of the amount necessary to fill
the strategic reserve to its original size, the Administrator
shall--
``(A) except as provided in subparagraph (B),
assign a vintage year to the emission allowance, which
shall be no earlier than the year in which the
allowance is established under paragraph (2), and shall
treat such allowances as ones that are not designated
for distribution or auction for purposes of section
782(q) and (r); and
``(B) to the extent any such allowances cannot be
assigned a vintage year because of the limitation in
paragraph (4), retire the allowances.
``(4) Limitation.--In no case may the Administrator assign
under paragraph (3)(A) more emission allowances to a vintage
year than the number of emission allowances from that vintage
year that were placed in the strategic reserve account under
subsection (b)(1).
``(h) Availability of International Offset Credits for Auction.--
``(1) In general.--The regulations promulgated under
section 721(h) shall allow any entity holding international
offset credits from reduced deforestation issued under section
743(e) to request that the Administrator include such offset
credits in an upcoming strategic reserve auction. The
regulations shall provide that--
``(A) such international offset credits will be
used to fill bid orders only after the supply of
strategic reserve allowances available for sale at that
auction has been depleted;
``(B) international offset credits may be sold at a
strategic reserve auction under this subsection only if
the Administrator determines that it is highly likely
that covered entities will, to cover emissions
occurring in the year the auction is held, use offset
credits to demonstrate compliance under section 722 for
emissions equal to or greater than 80 percent of 2
billion tons of carbon dioxide equivalent;
``(C) upon sale of such international offset
credits, the Administrator shall retire those
international offset credits, and establish and provide
to the purchasers a number of emission allowances equal
to 80 percent of the number of international offset
credits so retired, which allowances shall be in
addition to those established under section 721(a); and
``(D) for international offset credits sold
pursuant to this subsection, the proceeds for the
entity that offered the international offset credits
for sale shall be the lesser of--
``(i) the average daily closing price for
international offset credits sold on registered
exchanges (or if such price is unavailable, the
average price as determined by the
Administrator) during the six months prior to
the strategic reserve auction at which they
were auctioned, with the remaining funds
collected upon the sale of the international
offset credits deposited in the Treasury; and
``(ii) the amount received for the
international offset credits at the auction.
``(2) Proceeds.--For international offset credits sold
pursuant to this subsection, notwithstanding section 3302 of
title 31, United States Code, or any other provision of law,
within 90 days of receipt, the United States shall transfer the
proceeds from the auction, as defined in paragraph (1)(D), to
the entity that offered the international offset credits for
sale. No funds transferred from a purchaser to a seller of
international offset credits under this paragraph shall be held
by any officer or employee of the United States or treated for
any purpose as public monies.
``(3) Pricing.--When the Administrator acts under this
subsection as the agent of an entity in possession of
international offset credits, the Administrator is not
obligated to obtain the highest price possible for the
international offset credits, and instead shall auction such
international offset credits in the same manner and pursuant to
the same rules (except as modified in paragraph (1)) as set
forth for auctioning strategic reserve allowances. Entities
requesting that such international offset credits be offered
for sale at a strategic reserve auction may not set a minimum
reserve price for their international offset credits that is
different than the minimum strategic reserve auction price set
pursuant to subsection (c).
``(i) Initial Regulations.--Not later than 24 months after the date
of enactment of this title, the Administrator shall promulgate
regulations, in consultation with other appropriate agencies, governing
the auction of allowances under this section. Such regulations shall
include the following requirements:
``(1) Frequency; first auction.--Auctions shall be held
four times per year at regular intervals, with the first
auction to be held no later than March 31, 2012.
``(2) Auction format.--Auctions shall follow a single-
round, sealed-bid, uniform price format.
``(3) Participation; financial assurance.--Auctions shall
be open to any covered entity eligible to purchase emission
allowances at the auction under subsection (a)(2), except that
the Administrator may establish financial assurance
requirements to ensure that auction participants can and will
perform on their bids.
``(4) Disclosure of beneficial ownership.--Each bidder in
an auction shall be required to disclose the person or entity
sponsoring or benefitting from the bidder's participation in
the auction if such person or entity is, in whole or in part,
other than the bidder.
``(5) Purchase limits.--No person may, directly or in
concert with another participant, purchase more than 20 percent
of the allowances offered for sale at any quarterly auction.
``(6) Publication of information.--After the auction, the
Administrator shall, in a timely fashion, publish the
identities of winning bidders, the quantity of allowances
obtained by each winning bidder, and the auction clearing
price.
``(7) Other requirements.--The Administrator may include in
the regulations such other requirements or provisions as the
Administrator, in consultation with other agencies as
appropriate, considers appropriate to promote effective,
efficient, transparent, and fair administration of auctions
under this section.
``(j) Revision of Regulations.--The Administrator may, at any time,
in consultation with other agencies as appropriate, revise the initial
regulations promulgated under subsection (i) by promulgating new
regulations. Such revised regulations need not meet the requirements
identified in subsection (i) if the Administrator determines that an
alternative auction design would be more effective, taking into account
factors including costs of administration, transparency, fairness, and
risks of collusion or manipulation. In determining whether and how to
revise the initial regulations under this subsection, the Administrator
shall not consider maximization of revenues to the Federal Government.
``SEC. 727. PERMITS.
``(a) Permit Program.--For stationary sources subject to title V of
this Act that are covered entities, the provisions of this title shall
be implemented by permits issued to such covered entities (and
enforced) in accordance with the provisions of title V, as modified by
this title. Any such permit issued by the Administrator, or by a State
or Indian tribe with an approved permit program, shall require the
owner or operator of a covered entity to hold allowances or offset
credits at least equal to the total annual amount of carbon dioxide
equivalents for its combined emissions and attributable greenhouse gas
emissions to which section 722 applies. No such permit shall be issued
that is inconsistent with the requirements of this title, and title V
as applicable. Nothing in this section regarding compliance plans or in
title V shall be construed as affecting allowances or offset credits.
Submission of a statement by the owner or operator, or the designated
representative of the owners and operators, of a covered entity that
the owners and operators will hold allowances or offset credits for the
entity's combined emissions and attributable greenhouse gas emissions
to which section 722 applies shall be deemed to meet the proposed and
approved planning requirements of title V. Recordation by the
Administrator of transfers of allowances and offset credits shall amend
automatically all applicable proposed or approved permit applications,
compliance plans, and permits.
``(b) Multiple Owners.--No permit shall be issued under this
section and no allowances or offset credits shall be disbursed under
this title to a covered entity or any other person until the designated
representative of the owners or operators has filed a certificate of
representation with regard to matters under this title, including the
holding and distribution of emission allowances and the proceeds of
transactions involving emission allowances. Where there are multiple
holders of a legal or equitable title to, or a leasehold interest in,
such a covered entity or other entity or where a utility or industrial
customer purchases power under a long-term power purchase contract from
an independent power production facility that is a covered entity, the
certificate shall state--
``(1) that emission allowances and the proceeds of
transactions involving emission allowances will be deemed to be
held or distributed in proportion to each holder's legal,
equitable, leasehold, or contractual reservation or
entitlement; or
``(2) if such multiple holders have expressly provided for
a different distribution of emission allowances by contract,
that emission allowances and the proceeds of transactions
involving emission allowances will be deemed to be held or
distributed in accordance with the contract.
A passive lessor, or a person who has an equitable interest through
such lessor, whose rental payments are not based, either directly or
indirectly, upon the revenues or income from the covered entity or
other entity shall not be deemed to be a holder of a legal, equitable,
leasehold, or contractual interest for the purpose of holding or
distributing emission allowances as provided in this subsection, during
either the term of such leasehold or thereafter, unless expressly
provided for in the leasehold agreement. Except as otherwise provided
in this subsection, where all legal or equitable title to or interest
in a covered entity, or other entity, is held by a single person, the
certificate shall state that all emission allowances received by the
entity are deemed to be held for that person.
``(c) Prohibition.--It shall be unlawful for any person to operate
any stationary source subject to the requirements of this section
except in compliance with the terms and requirements of a permit issued
by the Administrator or a State or Indian tribe with an approved permit
program in accordance with this section. For purposes of this
subsection, compliance, as provided in section 504(f), with a permit
issued under title V which complies with this title for covered
entities shall be deemed compliance with this subsection as well as
section 502(a).
``(d) Reliability.--Nothing in this section or title V shall be
construed as requiring termination of operations of a stationary source
that is a covered entity for failure to have an approved permit, or
compliance plan, that is consistent with the requirements in the second
and fifth sentences of subsection (a) concerning the holding of
allowances or offset credits, except that any such covered entity may
be subject to the applicable enforcement provision of section 113.
``(e) Regulations.--Not later than 2 years after the date of
enactment of this title, the Administrator shall promulgate regulations
to implement this section. To provide for permits required under this
section, each State in which one or more stationary sources that are
covered entities are located shall submit, in accordance with this
section and title V, revised permit programs for approval.
``SEC. 728. INTERNATIONAL EMISSION ALLOWANCES.
``(a) Qualifying Programs.--The Administrator, in consultation with
the Secretary of State, may by rule designate an international climate
change program as a qualifying international program if--
``(1) the program is run by a national or supranational
foreign government, and imposes a mandatory absolute tonnage
limit on greenhouse gas emissions from 1 or more foreign
countries, or from 1 or more economic sectors in such a country
or countries; and
``(2) the program is at least as stringent as the program
established by this title, including provisions to ensure at
least comparable monitoring, compliance, enforcement, quality
of offsets, and restrictions on the use of offsets.
``(b) Disqualified Allowances.--An international emission allowance
may not be held under section 722(d)(2) if it is in the nature of an
offset instrument or allowance awarded based on the achievement of
greenhouse gas emission reductions or avoidance, or greenhouse gas
sequestration, that are not subject to the mandatory absolute tonnage
limits referred to in subsection (a)(1).
``(c) Retirement.--
``(1) Entity certification.--The owner or operator of an
entity that holds an international emission allowance under
section 722(d)(2) shall certify to the Administrator that such
international emission allowance has not previously been used
to comply with any foreign, international, or domestic
greenhouse gas regulatory program.
``(2) Retirement.--
``(A) Foreign and international regulatory
entities.--The Administrator, in consultation with the
Secretary of State, shall seek, by whatever means
appropriate, including agreements and technical
cooperation on allowance tracking, to ensure that any
relevant foreign, international, and domestic
regulatory entities--
``(i) are notified of the use, for purposes
of compliance with this title, of any
international emission allowance; and
``(ii) provide for the disqualification of
such international emission allowance for any
subsequent use under the relevant foreign,
international, or domestic greenhouse gas
regulatory program, regardless of whether such
use is a sale, exchange, or submission to
satisfy a compliance obligation.
``(B) Disqualification from further use.--The
Administrator shall ensure that, once an international
emission allowance has been disqualified or otherwise
used for purposes of compliance with this title, such
allowance shall be disqualified from any further use
under this title.
``(d) Use Limitations.--The Administrator may, by rule, apply a
limit to the percentage of the combined greenhouse gas emissions and
attributable greenhouse gas emissions of a covered entity with respect
to which compliance may be demonstrated by holding international
emission allowances under section 722(d)(2), consistent with the
purposes of the Safe Climate Act.
``PART D--OFFSETS
``SEC. 731. OFFSETS INTEGRITY ADVISORY BOARD.
``(a) Establishment.--Not later than 30 days after the date of
enactment of this title, the Administrator shall establish an
independent Offsets Integrity Advisory Board. The Advisory Board shall
make recommendations to the Administrator for use in promulgating and
revising regulations under this part and part E, and for ensuring the
overall environmental integrity of the programs established pursuant to
those regulations.
``(b) Membership.--The Advisory Board shall be comprised of at
least nine members. Each member shall be qualified by education,
training, and experience to evaluate scientific and technical
information on matters referred to the Board under this section. The
Administrator shall appoint Advisory Board members, including a chair
and vice-chair of the Advisory Board. Terms shall be 3 years in length,
except for initial terms, which may be up to 5 years in length to allow
staggering. Members may be reappointed only once for an additional 3-
year term, and such second term may follow directly after a first term.
``(c) Activities.--The Advisory Board established pursuant to
subsection (a) shall--
``(1) provide recommendations, not later than 90 days after
the Advisory Board's establishment and periodically thereafter,
to the Administrator regarding offset project types that should
be considered for eligibility under section 733, taking into
consideration relevant scientific and other issues, including--
``(A) the availability of a representative data set
for use in developing the activity baseline;
``(B) the potential for accurate quantification of
greenhouse gas reduction, avoidance, or sequestration
for an offset project type;
``(C) the potential level of scientific and
measurement uncertainty associated with an offset
project type; and
``(D) any beneficial or adverse environmental,
public health, welfare, social, economic, or energy
effects associated with an offset project type;
``(2) make available to the Administrator its advice and
comments on offset methodologies that should be considered
under regulations promulgated with respect to section 734,
including methodologies to address the issues of additionality,
activity baselines, quantification methods, leakage,
uncertainty, permanence, and environmental integrity;
``(3) make available to the Administrator, and other
relevant Federal agencies, its advice and comments regarding
scientific, technical, and methodological issues specific to
the issuance of international offset credits under section 743;
``(4) make available to the Administrator, and other
relevant Federal agencies, its advice and comments regarding
scientific, technical, and methodological issues associated
with the implementation of part E;
``(5) make available to the Administrator its advice and
comments on areas in which further knowledge is required to
appraise the adequacy of existing, revised, or proposed
methodologies for use under this part and part E, and describe
the research efforts necessary to provide the required
information; and
``(6) make available to the Administrator its advice and
comments on other ways to improve or safeguard the
environmental integrity of programs established under this part
and part E.
``(d) Scientific Review of Offset and Deforestation Reduction
Programs.--Not later than January 1, 2017, and at 5-year intervals
thereafter, the Advisory Board shall submit to the Administrator and
make available to the public an analysis of relevant scientific and
technical information related to this part and part E. The Advisory
Board shall review approved and potential methodologies, scientific
studies, offset project monitoring, offset project verification
reports, and audits related to this part and part E, and evaluate the
net emissions effects of implemented offset projects. The Advisory
Board shall recommend changes to offset methodologies, protocols, or
project types, or to the overall offset program under this part, to
ensure that offset credits issued by the Administrator do not
compromise the integrity of the annual emission reductions established
under section 703, and to avoid or minimize adverse effects to human
health or the environment.
``SEC. 732. ESTABLISHMENT OF OFFSETS PROGRAM.
``(a) Regulations.--Not later than 2 years after the date of
enactment of this title, the Administrator, in consultation with
appropriate Federal agencies and taking into consideration the
recommendations of the Advisory Board, shall promulgate regulations
establishing a program for the issuance of offset credits in accordance
with the requirements of this part. The Administrator shall
periodically revise these regulations as necessary to meet the
requirements of this part.
``(b) Requirements.--The regulations described in subsection (a)
shall--
``(1) authorize the issuance of offset credits with respect
to qualifying offset projects that result in reductions or
avoidance of greenhouse gas emissions, or sequestration of
greenhouse gases;
``(2) ensure that such offset credits represent verifiable
and additional greenhouse gas emission reductions or avoidance,
or increases in sequestration;
``(3) ensure that offset credits issued for sequestration
offset projects are only issued for greenhouse gas reductions
that are permanent;
``(4) provide for the implementation of the requirements of
this part; and
``(5) include as reductions in greenhouse gases reductions
achieved through the destruction of methane and its conversion
to carbon dioxide, and reductions achieved through destruction
of chlorofluorocarbons or other ozone depleting substances, if
permitted by the Administrator under section 619(b)(9) and
subject to the conditions specified in section 619(b)(9), based
on the carbon dioxide equivalent value of the substance
destroyed.
``(c) Coordination to Minimize Negative Effects.--In promulgating
and implementing regulations under this part, the Administrator shall
act (including by rejecting projects, if necessary) to avoid or
minimize, to the maximum extent practicable, adverse effects on human
health or the environment resulting from the implementation of offset
projects under this part.
``(d) Offset Registry.--The Administrator shall establish within
the allowance tracking system established under section 724(d) an
Offset Registry for qualifying offset projects and offset credits
issued with respect thereto under this part.
``(e) Legal Status of Offset Credit.--An offset credit does not
constitute a property right.
``(f) Fees.--The Administrator shall assess fees payable by offset
project developers in an amount necessary to cover the administrative
costs to the Environmental Protection Agency of carrying out the
activities under this part. Amounts collected for such fees shall be
available to the Administrator for carrying out the activities under
this part to the extent provided in advance in appropriations Acts.
``SEC. 733. ELIGIBLE PROJECT TYPES.
``(a) List of Eligible Project Types.--
``(1) In general.--As part of the regulations promulgated
under section 732(a), the Administrator shall establish, and
may periodically revise, a list of types of projects eligible
to generate offset credits, including international offset
credits, under this part.
``(2) Advisory board recommendations.--In determining the
eligibility of project types, the Administrator shall take into
consideration the recommendations of the Advisory Board. If a
list established under this section differs from the
recommendations of the Advisory Board, the regulations
promulgated under section 732(a) shall include a justification
for the discrepancy.
``(3) Initial determination.--The Administrator shall
establish the initial eligibility list under paragraph (1) not
later than 1 year after the date of enactment of this title.
The Administrator shall add additional project types to the
list not later than 2 years after the date of enactment of this
title. In determining the initial list, the Administrator shall
give priority to consideration of offset project types that are
recommended by the Advisory Board and for which there are well
developed methodologies that the Administrator determines would
meet the criteria of section 734, with such modifications as
the Administrator deems appropriate. In establishing
methodologies pursuant to section 734, the Administrator shall
give priority to methodologies for offset project types
included on the initial eligibility list.
``(b) Modification of List.--The Administrator--
``(1) may at any time, by rule, add a project type to the
list established under subsection (a) if the Administrator, in
consultation with appropriate Federal agencies and taking into
consideration the recommendations of the Advisory Board,
determines that the project type can generate additional
reductions or avoidance of greenhouse gas emissions, or
sequestration of greenhouse gases, subject to the requirements
of this part;
``(2) may at any time, by rule, determine that a project
type on the list does not meet the requirements of this part,
and remove the project type from the list established under
subsection (a), in consultation with appropriate Federal
agencies and taking into consideration any recommendations of
the Advisory Board; and
``(3) shall consider adding to or removing from the list
established under subsection (a), at a minimum, project types
proposed to the Administrator--
``(A) by petition pursuant to subsection (c); or
``(B) by the Advisory Board.
``(c) Petition Process.--Any person may petition the Administrator
to modify the list established under subsection (a) by adding or
removing a project type pursuant to subsection (b). Any such petition
shall include a showing by the petitioner that there is adequate data
to establish that the project type does or does not meet the
requirements of this part. Not later than 12 months after receipt of
such a petition, the Administrator shall either grant or deny the
petition and publish a written explanation of the reasons for the
Administrator's decision. The Administrator may not deny a petition
under this subsection on the basis of inadequate Environmental
Protection Agency resources or time for review.
``SEC. 734. REQUIREMENTS FOR OFFSET PROJECTS.
``(a) Methodologies.--As part of the regulations promulgated under
section 732(a), the Administrator shall establish, for each type of
offset project listed as eligible under section 733, the following:
``(1) Additionality.--A standardized methodology for
determining the additionality of greenhouse gas emission
reductions or avoidance, or greenhouse gas sequestration,
achieved by an offset project of that type. Such methodology
shall ensure, at a minimum, that any greenhouse gas emission
reduction or avoidance, or any greenhouse gas sequestration, is
considered additional only to the extent that it results from
activities that--
``(A) are not required by or undertaken to comply
with any law, including any regulation or consent
order;
``(B) were not commenced prior to January 1, 2009,
except in the case of--
``(i) offset project activities that
commenced after January 1, 2001, and were
registered as of the date of enactment of this
title under an offset program with respect to
which the Administrator has made an affirmative
determination under section 740(a)(2); or
``(ii) activities that are readily
reversible, with respect to which the
Administrator may set an alternative earlier
date under this subparagraph that is not
earlier than January 1, 2001, where the
Administrator determines that setting such an
alternative date may produce an environmental
benefit by removing an incentive to cease and
then reinitiate activities that began prior to
January 1, 2009; and
``(C) exceed the activity baseline established
under paragraph (2).
``(2) Activity baselines.--A standardized methodology for
establishing activity baselines for offset projects of that
type. The Administrator shall set activity baselines to reflect
a conservative estimate of business-as-usual performance or
practices for the relevant type of activity such that the
baseline provides an adequate margin of safety to ensure the
environmental integrity of offsets calculated in reference to
such baseline.
``(3) Quantification methods.--A standardized methodology
for determining the extent to which greenhouse gas emission
reductions or avoidance, or greenhouse gas sequestration,
achieved by an offset project of that type exceed a relevant
activity baseline, including protocols for monitoring and
accounting for uncertainty.
``(4) Leakage.--A standardized methodology for accounting
for and mitigating potential leakage, if any, from an offset
project of that type, taking uncertainty into account.
``(b) Accounting for Reversals.--
``(1) In general.--For each type of sequestration project
listed under section 733, the Administrator shall establish
requirements to account for and address reversals, including--
``(A) a requirement to report any reversal with
respect to an offset project for which offset credits
have been issued under this part;
``(B) provisions to require emission allowances to
be held in amounts to fully compensate for greenhouse
gas emissions attributable to reversals, and to assign
responsibility for holding such emission allowances;
and
``(C) any other provisions the Administrator
determines necessary to account for and address
reversals.
``(2) Mechanisms.--The Administrator shall prescribe
mechanisms to ensure that any sequestration with respect to
which an offset credit is issued under this part results in a
permanent net increase in sequestration, and that full account
is taken of any actual or potential reversal of such
sequestration, with an adequate margin of safety. The
Administrator shall prescribe at least one of the following
mechanisms to meet the requirements of this paragraph:
``(A) An offsets reserve, pursuant to paragraph
(3).
``(B) Insurance that provides for purchase and
provision to the Administrator for retirement of an
amount of offset credits or emission allowances equal
in number to the tons of carbon dioxide equivalents of
greenhouse gas emissions released due to reversal.
``(C) Another mechanism that the Administrator
determines satisfies the requirements of this part.
``(3) Offsets reserve.--
``(A) In general.--An offsets reserve referred to
in paragraph (2)(A) is a program under which, before
issuance of offset credits under this part, the
Administrator shall subtract and reserve from the
quantity to be issued a quantity of offset credits
based on the risk of reversal. The Administrator
shall--
``(i) hold these reserved offset credits in
the offsets reserve; and
``(ii) register the holding of the reserved
offset credits in the Offset Registry
established under section 732(d).
``(B) Project reversal.--
``(i) In general.--If a reversal has
occurred with respect to an offset project for
which offset credits are reserved under this
paragraph, the Administrator shall retire
offset credits or emission allowances from the
offsets reserve to fully account for the tons
of carbon dioxide equivalent that are no longer
sequestered.
``(ii) Intentional reversals.--If the
Administrator determines that a reversal was
intentional, the offset project developer for
the relevant offset project shall place into
the offsets reserve a quantity of offset
credits, or combination of offset credits and
emission allowances, equal in number to the
number of reserve offset credits that were
canceled due to the reversal pursuant to clause
(i).
``(iii) Unintentional reversals.--If the
Administrator determines that a reversal was
unintentional, the offset project developer for
the relevant offset project shall place into
the offsets reserve a quantity of offset
credits, or combination of offset credits and
emission allowances, equal in number to half
the number of offset credits that were reserved
for that offset project, or half the number of
reserve offset credits that were canceled due
to the reversal pursuant to clause (i),
whichever is less.
``(C) Use of reserved offset credits.--Offset
credits placed into the offsets reserve under this
paragraph may not be used to comply with section 722.
``(c) Crediting Periods.--
``(1) In general.--For each offset project type, the
Administrator shall specify a crediting period, and establish
provisions for petitions for new crediting periods, in
accordance with this subsection.
``(2) Duration.--The crediting period shall be no less than
5 and no greater than 10 years for any project type other than
those involving sequestration.
``(3) Eligibility.--An offset project shall be eligible to
generate offset credits under this part only during the
project's crediting period. During such crediting period, the
project shall remain eligible to generate offset credits,
subject to the methodologies and project type eligibility list
that applied as of the date of project approval under section
735, except as provided in paragraph (4) of this subsection.
``(4) Petition for new crediting period.--An offset project
developer may petition for a new crediting period to commence
after termination of a crediting period, subject to the
methodologies and project type eligibility list in effect at
the time when such petition is submitted. A petition may not be
submitted under this paragraph more than 18 months before the
end of the pending crediting period. The Administrator may
limit the number of new crediting periods available for
projects of particular project types.
``(d) Environmental Integrity.--In establishing the requirements
under this section, the Administrator shall apply conservative
assumptions or methods to maximize the certainty that the environmental
integrity of the cap established under section 703 is not compromised.
``(e) Pre-existing Methodologies.--In promulgating requirements
under this section, the Administrator shall give due consideration to
methodologies for offset projects existing as of the date of enactment
of this title.
``(f) Added Project Types.--The Administrator shall establish
methodologies described in subsection (a), and, as applicable,
requirements and mechanisms for reversals as described in subsection
(b), for any project type that is added to the list pursuant to section
733.
``SEC. 735. APPROVAL OF OFFSET PROJECTS.
``(a) Approval Petition.--An offset project developer shall submit
an offset project approval petition providing such information as the
Administrator requires to determine whether the offset project is
eligible for issuance of offset credits under rules promulgated
pursuant to this part.
``(b) Timing.--An approval petition shall be submitted to the
Administrator under subsection (a) no later than the time at which an
offset project's first verification report is submitted under section
736.
``(c) Approval Petition Requirements.--As part of the regulations
promulgated under section 732, the Administrator shall include
provisions for, and shall specify, the required components of an offset
project approval petition required under subsection (a), which shall
include--
``(1) designation of an offset project developer; and
``(2) any other information that the Administrator
considers to be necessary to achieve the purposes of this part.
``(d) Approval and Notification.--Not later than 90 days after
receiving a complete approval petition under subsection (a), the
Administrator shall make the approval petition publicly available,
approve or deny the petition in writing and if the petition is denied,
provide the reasons for denial, and make the Administrator's written
decision publicly available. After an offset project is approved, the
offset project developer shall not be required to resubmit an approval
petition during the offset project's crediting period, except as
provided in section 734(c)(4).
``(e) Appeal.--The Administrator shall establish procedures for
appeal and review of determinations made under subsection (d).
``(f) Voluntary Preapproval Review.--The Administrator may
establish a voluntary preapproval review procedure, to allow an offset
project developer to request the Administrator to conduct a preliminary
eligibility review for an offset project. Findings of such reviews
shall not be binding upon the Administrator. The voluntary preapproval
review procedure--
``(1) shall require the offset project developer to submit
such basic project information as the Administrator requires to
provide a meaningful review; and
``(2) shall require a response from the Administrator not
later than 6 weeks after receiving a request for review under
this subsection.
``SEC. 736. VERIFICATION OF OFFSET PROJECTS.
``(a) In General.--As part of the regulations promulgated under
section 732(a), the Administrator shall establish requirements,
including protocols, for verification of the quantity of greenhouse gas
emission reductions or avoidance, or sequestration of greenhouse gases,
resulting from an offset project. The regulations shall require that an
offset project developer shall submit a report, prepared by a third-
party verifier accredited under subsection (d), providing such
information as the Administrator requires to determine the quantity of
greenhouse gas emission reductions or avoidance, or sequestration of
greenhouse gases, resulting from the offset project.
``(b) Schedule.--The Administrator shall prescribe a schedule for
the submission of verification reports under subsection (a).
``(c) Verification Report Requirements.--The Administrator shall
specify the required components of a verification report required under
subsection (a), which shall include--
``(1) the name and contact information for a designated
representative for the offset project developer;
``(2) the quantity of greenhouse gases reduced, avoided, or
sequestered;
``(3) the methodologies applicable to the project pursuant
to section 734;
``(4) a certification that the project meets the applicable
requirements;
``(5) a certification establishing that the conflict of
interest requirements in the regulations promulgated under
subsection (d)(1) have been complied with; and
``(6) any other information that the Administrator
considers to be necessary to achieve the purposes of this part.
``(d) Verifier Accreditation.--
``(1) In general.--As part of the regulations promulgated
under section 732(a), the Administrator shall establish a
process and requirements for periodic accreditation of third-
party verifiers to ensure that such verifiers are
professionally qualified and have no conflicts of interest.
``(2) Standards.--
``(A) American national standards institute
accreditation.--The Administrator may accredit, or
accept for purposes of accreditation under this
subsection, verifiers accredited under the American
National Standards Institute (ANSI) accreditation
program in accordance with ISO 14065. The Administrator
shall accredit, or accept for accreditation, verifiers
under this subparagraph only if the Administrator finds
that the American National Standards Institute
accreditation program provides sufficient assurance
that the requirements of this part will be met.
``(B) EPA accreditation.--As part of the
regulations promulgated under section 732(a), the
Administrator may establish accreditation standards for
verifiers under this subsection, and may establish
related training and testing programs and requirements.
``(3) Public accessibility.--Each verifier meeting the
requirements for accreditation in accordance with this
subsection shall be listed in a publicly accessible database,
which shall be maintained and updated by the Administrator.
``SEC. 737. ISSUANCE OF OFFSET CREDITS.
``(a) Determination and Notification.--Not later than 90 days after
receiving a complete verification report under section 736, the
Administrator shall--
``(1) make the report publicly available;
``(2) make a determination of the quantity of greenhouse
gas emissions that have been reduced or avoided, or greenhouse
gases that have been sequestered, by the offset project; and
``(3) notify the offset project developer in writing of
such determination and make such determination publicly
available.
``(b) Issuance Of Offset Credits.--The Administrator shall issue
one offset credit to an offset project developer for each ton of carbon
dioxide equivalent that the Administrator has determined has been
reduced, avoided, or sequestered during the period covered by a
verification report submitted in accordance with section 736, only if--
``(1) the Administrator has approved the offset project
pursuant to section 735; and
``(2) the relevant emissions reduction, avoidance, or
sequestration has--
``(A) already occurred, during the offset project's
crediting period; and
``(B) occurred after January 1, 2009.
``(c) Appeal.--The Administrator shall establish procedures for
appeal and review of determinations made under subsection (a).
``(d) Timing.--Offset credits meeting the criteria established in
subsection (b) shall be issued not later than 2 weeks following the
verification determination made by the Administrator under subsection
(a).
``(e) Registration.--The Administrator shall assign a unique serial
number to and register each offset credit to be issued in the Offset
Registry established under section 732(d).
``SEC. 738. AUDITS.
``(a) In General.--The Administrator shall, on an ongoing basis,
conduct random audits of offset projects, offset credits, and practices
of third-party verifiers. In each year, the Administrator shall conduct
audits, at minimum, for a representative sample of project types and
geographic areas.
``(b) Delegation.--The Administrator may delegate to a State or
tribal government the responsibility for conducting audits under this
section if the Administrator finds that the program proposed by the
State or tribal government provides assurances equivalent to those
provided by the auditing program of the Administrator, and that the
integrity of the offset program under this part will be maintained.
Nothing in this subsection shall prevent the Administrator from
conducting any audit the Administrator considers necessary and
appropriate.
``SEC. 739. PROGRAM REVIEW AND REVISION.
``At least once every 5 years, the Administrator shall review and,
based on new or updated information and taking into consideration the
recommendations of the Advisory Board, update and revise--
``(1) the list of eligible project types established under
section 733;
``(2) the methodologies established, including specific
activity baselines, under section 734(a);
``(3) the reversal requirements and mechanisms established
or prescribed under section 734(b);
``(4) measures to improve the accountability of the offsets
program; and
``(5) any other requirements established under this part to
ensure the environmental integrity and effective operation of
this part.
``SEC. 740. EARLY OFFSET SUPPLY.
``(a) Projects Registered Under Other Government-recognized
Programs.--Except as provided in subsection (b) or (c), the
Administrator shall issue one offset credit for each ton of carbon
dioxide equivalent emissions reduced, avoided, or sequestered--
``(1) under an offset project that was started after
January 1, 2001;
``(2) for which a credit was issued under any regulatory or
voluntary greenhouse gas emission offset program that the
Administrator determines--
``(A) was established under State or tribal law or
regulation prior to January 1, 2009, or has been
approved by the Administrator pursuant to subsection
(e);
``(B) has developed offset project type standards,
methodologies, and protocols through a public
consultation process or a peer review process;
``(C) has made available to the public standards,
methodologies, and protocols that require that credited
emission reductions, avoidance, or sequestration are
permanent, additional, verifiable, and enforceable;
``(D) requires that all emission reductions,
avoidance, or sequestration be verified by a State or
tribal regulatory agency or an accredited third-party
independent verification body;
``(E) requires that all credits issued are
registered in a publicly accessible registry, with
individual serial numbers assigned for each ton of
carbon dioxide equivalent emission reductions,
avoidance, or sequestration; and
``(F) ensures that no credits are issued for an
activity if the entity administering the program, or a
program administrator or representative, has funded,
solicited, or served as a fund administrator for the
development of the activity; and
``(3) for which the credit described in paragraph (2) is
transferred to the Administrator.
``(b) Ineligible Credits.--Subsection (a) shall not apply to offset
credits that have expired or have been retired, canceled, or used for
compliance under a program established under State or tribal law or
regulation.
``(c) Limitation.--Notwithstanding subsection (a)(1), offset
credits shall be issued under this section--
``(1) only for reductions or avoidance of greenhouse gas
emissions, sequestration of greenhouse gases, or destruction of
chlorofluorocarbons (subject to the conditions specified in
section 619(b)(9) and based on the carbon dioxide equivalent
value of the substance destroyed), that occur after January 1,
2009; and
``(2) only until the date that is 3 years after the date of
enactment of this title, or the date that regulations
promulgated under section 732(a) take effect, whichever occurs
sooner.
``(d) Retirement of Credits.--The Administrator shall seek to
ensure that offset credits described in subsection (a)(2) are retired
for purposes of use under a program described in subsection (b).
``(e) Other Programs.--(1) Offset programs that either--
``(A) were not established under State or tribal law or
regulation; or
``(B) were not established prior to January 1, 2009,
but that otherwise meet all of the criteria of subsection (a)(2) may
apply to the Administrator to be approved under this subsection as an
eligible program for early offset credits under this section.
``(2) The Administrator shall approve any such program that the
Administrator determines has criteria and methodologies of at least
equal stringency to the criteria and methodologies of the programs
established under State or tribal law or regulation that the
Administrator determines meet the criteria of subsection (a)(2). The
Administrator may approve types of offsets under any such program that
are subject to criteria and methodologies of at least equal stringency
to the criteria and methodologies for such types of offsets applied
under the programs established under State or tribal law or regulation
that the Administrator determines meet the criteria of subsection
(a)(2). The Administrator shall make a determination on any application
received under this section by no later than 180 days from the date of
receipt of the application.
``SEC. 741. ENVIRONMENTAL CONSIDERATIONS.
``If the Administrator lists forestry or other relevant land
management-related offset projects as eligible offset project types
under section 733, the Administrator, in consultation with appropriate
Federal agencies, shall promulgate regulations for the selection and
use of species in such offset projects--
``(1) to ensure that native species are given primary
consideration in such projects;
``(2) to enhance biological diversity in such projects;
``(3) to prohibit the use of federally designated or State-
designated noxious weeds;
``(4) to prohibit the use of a species listed by a regional
or State invasive plant authority within the applicable region
or State; and
``(5) in the case of forestry offset projects, in
accordance with widely accepted, environmentally sustainable
forestry practices.
``SEC. 742. TRADING.
``Section 724 shall apply to the trading of offset credits.
``SEC. 743. INTERNATIONAL OFFSET CREDITS.
``(a) In General.--The Administrator, in consultation with the
Secretary of State and the Administrator of the United States Agency
for International Development, may issue, in accordance with this
section, international offset credits based on activities that reduce
or avoid greenhouse gas emissions, or increase sequestration of
greenhouse gases, in a developing country. Such credits may be issued
for projects eligible under section 733 or as provided in subsection
(c), (d), or (e) of this section.
``(b) Issuance.--
``(1) Regulations.--Not later than 2 years after the date
of enactment of this title, the Administrator, in consultation
with the Secretary of State, the Administrator of the United
States Agency for International Development, and any other
appropriate Federal agency, and taking into consideration the
recommendations of the Advisory Board, shall promulgate
regulations for implementing this section. Except as otherwise
provided in this section, the issuance of international offset
credits under this section shall be subject to the requirements
of this part.
``(2) Requirements for international offset credits.--The
Administrator may issue international offset credits only if--
``(A) the United States is a party to a bilateral
or multilateral agreement or arrangement that includes
the country in which the project or measure achieving
the relevant greenhouse gas emission reduction or
avoidance, or greenhouse gas sequestration, has
occurred;
``(B) such country is a developing country; and
``(C) such agreement or arrangement--
``(i) ensures that the requirements of this
part apply to the issuance of international
offset credits under this section; and
``(ii) provides for the appropriate
distribution of international offset credits
issued.
``(c) Sector-based Credits.--
``(1) In general.--In order to minimize the potential for
leakage and to encourage countries to take nationally
appropriate mitigation actions to reduce or avoid greenhouse
gas emissions, or sequester greenhouse gases, the
Administrator, in consultation with the Secretary of State and
the Administrator of the United States Agency for International
Development, shall--
``(A) identify sectors of specific countries with
respect to which the issuance of international offset
credits on a sectoral basis is appropriate; and
``(B) issue international offset credits for such
sectors only on a sectoral basis.
``(2) Identification of sectors.--
``(A) General rule.--For purposes of paragraph
(1)(A), a sectoral basis shall be appropriate for
activities--
``(i) in countries that have comparatively
high greenhouse gas emissions, or comparatively
greater levels of economic development; and
``(ii) that, if located in the United
States, would be within a sector subject to the
compliance obligation under section 722.
``(B) Factors.--In determining the sectors and
countries for which international offset credits should
be awarded only on a sectoral basis, the Administrator,
in consultation with the Secretary of State and the
Administrator of the United States Agency for
International Development, shall consider the following
factors:
``(i) The country's gross domestic product.
``(ii) The country's total greenhouse gas
emissions.
``(iii) Whether the comparable sector of
the United States economy is covered by the
compliance obligation under section 722.
``(iv) The heterogeneity or homogeneity of
sources within the relevant sector.
``(v) Whether the relevant sector provides
products or services that are sold in
internationally competitive markets.
``(vi) The risk of leakage if international
offset credits were issued on a project-level
basis, instead of on a sectoral basis, for
activities within the relevant sector.
``(vii) The capability of accurately
measuring, monitoring, reporting, and verifying
the performance of sources across the relevant
sector.
``(viii) Such other factors as the
Administrator, in consultation with the
Secretary of State and the Administrator of the
United States Agency for International
Development, determines are appropriate to--
``(I) ensure the integrity of the
United States greenhouse gas emissions
cap established under section 703; and
``(II) encourage countries to take
nationally appropriate mitigation
actions to reduce or avoid greenhouse
gas emissions, or sequester greenhouse
gases.
``(3) Sectoral basis.--
``(A) Definition.--In this subsection, the term
`sectoral basis' means the issuance of international
offset credits only for the quantity of sector-wide
reductions or avoidance of greenhouse gas emissions, or
sector-wide increases in sequestration of greenhouse
gases, achieved across the relevant sector of the
economy relative to a domestically enforceable baseline
level of absolute emissions established in an agreement
or arrangement described in subsection (b)(2)(A) for
the sector.
``(B) Baseline.--The baseline for a sector shall be
established on an absolute basis and at levels of
greenhouse gas emissions consistent with the thresholds
identified in section 705(e)(2) and lower than would
occur under a business-as-usual scenario taking into
account relevant domestic or international policies or
incentives to reduce greenhouse gas emissions, among
other factors, and additionality and performance shall
be determined on the basis of such baseline.
``(d) Credits Issued by an International Body.--
``(1) In general.--The Administrator, in consultation with
the Secretary of State, may issue international offset credits
in exchange for instruments in the nature of offset credits
that are issued by an international body established pursuant
to the United Nations Framework Convention on Climate Change,
to a protocol to such Convention, or to a treaty that succeeds
such Convention. The Administrator may issue international
offset credits under this subsection only if, in addition to
the requirements of subsection (b), the Administrator has
determined that the international body that issued the
instruments has implemented substantive and procedural
requirements for the relevant project type that provide equal
or greater assurance of the integrity of such instruments as is
provided by the requirements of this part. Starting January 1,
2016, the Administrator shall issue no offset credit pursuant
to this subsection if the activity generating the greenhouse
gas emissions reductions or avoidance, or greenhouse gas
sequestration, occurs in a country and sector identified by the
Administrator under subsection (c).
``(2) Retirement.--The Administrator, in consultation with
the Secretary of State, shall seek, by whatever means
appropriate, including agreements, arrangements, or technical
cooperation with the international issuing body described in
paragraph (1), to ensure that such body--
``(A) is notified of the Administrator's issuance,
under this subsection, of an international offset
credit in exchange for an instrument issued by such
international body; and
``(B) provides, to the extent feasible, for the
disqualification of the instrument issued by such
international body for subsequent use under any
relevant foreign or international greenhouse gas
regulatory program, regardless of whether such use is a
sale, exchange, or submission to satisfy a compliance
obligation.
``(e) Offsets From Reduced Deforestation.--
``(1) Requirements.--The Administrator, in accordance with
the regulations promulgated under subsection (b)(1) and an
agreement or arrangement described in subsection (b)(2)(A),
shall issue international offset credits for greenhouse gas
emission reductions achieved through activities to reduce
deforestation only if, in addition to the requirements of
subsection (b)--
``(A) the activity occurs in--
``(i) a country listed by the Administrator
pursuant to paragraph (2);
``(ii) a state or province listed by the
Administrator pursuant to paragraph (5); or
``(iii) a country listed by the
Administrator pursuant to paragraph (6);
``(B) except as provided in paragraph (5) or (6),
the quantity of the international offset credits is
determined by comparing the national emissions from
deforestation relative to a national deforestation
baseline for that country established, in accordance
with an agreement or arrangement described in
subsection (b)(2)(A), pursuant to paragraph (4);
``(C) the reduction in emissions from deforestation
has occurred before the issuance of the international
offset credit and, taking into consideration relevant
international standards, has been demonstrated using
ground-based inventories, remote sensing technology,
and other methodologies to ensure that all relevant
carbon stocks are accounted;
``(D) the Administrator has made appropriate
adjustments, such as discounting for any additional
uncertainty, to account for circumstances specific to
the country, including its technical capacity described
in paragraph (2)(A);
``(E) the activity is designed, carried out, and
managed--
``(i) in accordance with widely accepted,
environmentally sustainable forest management
practices;
``(ii) to promote or restore native forest
species and ecosystems where practicable, and
to avoid the introduction of invasive nonnative
species;
``(iii) in a manner that gives due regard
to the rights and interests of local
communities, indigenous peoples, forest-
dependent communities, and vulnerable social
groups;
``(iv) with consultations with, and full
participation of, local communities, indigenous
peoples, and forest-dependent communities, in
affected areas, as partners and primary
stakeholders, prior to and during the design,
planning, implementation, and monitoring and
evaluation of activities; and
``(v) with equitable sharing of profits and
benefits derived from offset credits with local
communities, indigenous peoples, and forest-
dependent communities; and
``(F) the reduction otherwise satisfies and is
consistent with any relevant requirements established
by an agreement reached under the auspices of the
United Nations Framework Convention on Climate Change.
``(2) Eligible countries.--The Administrator, in
consultation with the Secretary of State and the Administrator
of the United States Agency for International Development, and
in accordance with an agreement or arrangement described in
subsection (b)(2)(A), shall establish, and periodically review
and update, a list of the developing countries that have the
capacity to participate in deforestation reduction activities
at a national level, including--
``(A) the technical capacity to monitor, measure,
report, and verify forest carbon fluxes for all
significant sources of greenhouse gas emissions from
deforestation with an acceptable level of uncertainty,
as determined taking into account relevant
internationally accepted methodologies, such as those
established by the Intergovernmental Panel on Climate
Change;
``(B) the institutional capacity to reduce
emissions from deforestation, including strong forest
governance and mechanisms to equitably distribute
deforestation resources for local actions; and
``(C) a land use or forest sector strategic plan
that--
``(i) assesses national and local drivers
of deforestation and forest degradation and
identifies reforms to national policies needed
to address them;
``(ii) estimates the country's emissions
from deforestation and forest degradation;
``(iii) identifies improvements in data
collection, monitoring, and institutional
capacity necessary to implement a national
deforestation reduction program; and
``(iv) establishes a timeline for
implementing the program and transitioning to
low-emissions development with respect to
emissions from forest and land use activities.
``(3) Protection of interests.--With respect to an
agreement or arrangement described in subsection (b)(2)(A) that
addresses international offset credits under this subsection,
the Administrator, in consultation with the Secretary of State
and the Administrator of the United States Agency for
International Development, shall seek to ensure the
establishment and enforcement by such country of legal regimes,
processes, standards, and safeguards that--
``(A) give due regard to the rights and interests
of local communities, indigenous peoples, forest-
dependent communities, and vulnerable social groups;
``(B) promote consultations with, and full
participation of, forest-dependent communities and
indigenous peoples in affected areas, as partners and
primary stakeholders, prior to and during the design,
planning, implementation, and monitoring and evaluation
of activities; and
``(C) encourage equitable sharing of profits and
benefits derived from international offset credits with
local communities, indigenous peoples, and forest-
dependent communities.
``(4) National deforestation baseline.--A national
deforestation baseline established under this subsection
shall--
``(A) be national in scope;
``(B) be consistent with nationally appropriate
mitigation commitments or actions with respect to
deforestation, taking into consideration the average
annual historical deforestation rates of the country
during a period of at least 5 years, the applicable
drivers of deforestation, and other factors to ensure
additionality;
``(C) establish a trajectory that would result in
zero net deforestation by not later than 20 years after
the national deforestation baseline has been
established;
``(D) be adjusted over time to take account of
changing national circumstances;
``(E) be designed to account for all significant
sources of greenhouse gas emissions from deforestation
in the country; and
``(F) be consistent with the national deforestation
baseline, if any, established for such country under
section 754(d)(1) and (2).
``(5) State-level or province-level activities.--
``(A) Eligible states or provinces.--The
Administrator, in consultation with the Secretary of
State and the Administrator of the United States Agency
for International Development, shall establish within 2
years after the date of enactment of this title, and
periodically review and update, a list of states or
provinces in developing countries where--
``(i) the developing country is not
included on the list of countries established
pursuant to paragraph (6)(A);
``(ii) the state or province by itself is a
major emitter of greenhouse gases from tropical
deforestation on a scale commensurate to the
emissions of other countries; and
``(iii) the state or province meets the
eligibility criteria in paragraphs (2) and (3)
for the geographic area under its jurisdiction.
``(B) Activities.--The Administrator may issue
international offset credits for greenhouse gas
emission reductions achieved through activities to
reduce deforestation at a state or provincial level
that meet the requirements of this section. Such
credits shall be determined by comparing the emissions
from deforestation within that state or province
relative to the state or province deforestation
baseline for that state or province established, in
accordance with an agreement or arrangement described
in subsection (b)(2)(A), pursuant to subparagraph (C)
of this paragraph.
``(C) State or province deforestation baseline.--A
state or province deforestation baseline shall--
``(i) be consistent with any existing
nationally appropriate mitigation commitments
or actions for the country in which the
activity is occurring, taking into
consideration the average annual historical
deforestation rates of the state or province
during a period of at least 5 years, relevant
drivers of deforestation, and other factors to
ensure additionality;
``(ii) establish a trajectory that would
result in zero net deforestation by not later
than 20 years after the state or province
deforestation baseline has been established;
and
``(iii) be designed to account for all
significant sources of greenhouse gas emissions
from deforestation in the state or province and
adjusted to fully account for emissions leakage
outside the state or province.
``(D) Phase out.--Beginning 5 years after the first
calendar year for which a covered entity must
demonstrate compliance with section 722(a), the
Administrator shall issue no further international
offset credits for eligible state-level or province-
level activities to reduce deforestation pursuant to
this paragraph.
``(6) Projects and programs to reduce deforestation.--
``(A) Eligible countries.--The Administrator, in
consultation with the Secretary of State and the
Administrator of the United States Agency for
International Development, shall establish within 2
years after the date of enactment of this title, and
periodically review and update, a list of developing
countries each of which--
``(i) the Administrator determines, based
on recent, credible, and reliable emissions
data, accounts for less than 1 percent of
global greenhouse gas emissions and less than 3
percent of global forest-sector and land use
change greenhouse gas emissions; and
``(ii) has, or in the determination of the
Administrator is making a good faith effort to
develop, a land use or forest sector strategic
plan that meets the criteria described in
paragraph (2)(C).
``(B) Activities.--The Administrator may issue
international offset credits for greenhouse gas
emission reductions achieved through project or program
level activities to reduce deforestation in countries
listed under subparagraph (A) that meet the
requirements of this section. The quantity of
international offset credits shall be determined by
comparing the project-level or program-level emissions
from deforestation to a deforestation baseline for such
project or program established pursuant to subparagraph
(C).
``(C) Project-level or program-level baseline.--A
project-level or program-level deforestation baseline
shall--
``(i) be consistent with any existing
nationally appropriate mitigation commitments
or actions for the country in which the project
or program is occurring, taking into
consideration the average annual historical
deforestation rates relevant to the specific
project or program during a period of at least
5 years, applicable drivers of deforestation,
and other factors to ensure additionality;
``(ii) be designed to account for all
significant sources of greenhouse gas emissions
from deforestation in the project or program
boundary; and
``(iii) be adjusted to fully account for
emissions leakage outside the project or
program boundary.
``(D) Phase out.--(i) Beginning 5 years after the
first calendar year for which a covered entity must
demonstrate compliance with section 722(a), the
Administrator shall issue no further international
offset credits for project-level or program-level
activities pursuant to this paragraph, except as
provided in clause (ii).
``(ii) The Administrator may extend the phase out
deadline for the issuance of international offset
credits under this paragraph by up to 8 years with
respect to eligible activities taking place in a least
developed country, which for purposes of this paragraph
is defined as a foreign country that the United Nations
has identified as among the least developed of
developing countries at the time that the Administrator
determines to provide an extension, if the
Administrator, in consultation with the Secretary of
State and the Administrator of the United States Agency
for International Development, determines the country--
``(I) lacks sufficient capacity to adopt
and implement effective programs to achieve
reductions in deforestation measured against
national baselines;
``(II) is receiving support under part E to
develop such capacity; and
``(III) has developed and is working to
implement a credible national strategy or plan
to reduce deforestation.
``(7) Deforestation.--In implementing this subsection, the
Administrator, taking into consideration the recommendations of
the Advisory Board, may include forest degradation, or soil
carbon losses associated with forested wetlands or peatlands,
within the meaning of deforestation.
``(8) Consultation.--In implementing this subsection, the
Administrator shall consult with the Secretary of Agriculture
on relevant matters within such Secretary's area of expertise.
``(f) Modification of Requirements.--In promulgating regulations
under subsection (b)(1) with respect to the issuance of international
offset credits under subsection (c), (d), or (e), the Administrator, in
consultation with the Secretary of State and the Administrator of the
United States Agency for International Development, may modify or omit
a requirement of this part (excluding the requirements of this section)
if the Administrator determines that the application of that
requirement to such subsection is not feasible. In modifying or
omitting such a requirement on the basis of infeasibility, the
Administrator, in consultation with the Secretary of State and the
Administrator of the United States Agency for International
Development, shall ensure, with an adequate margin of safety, the
integrity of international offset credits issued under this section and
of the greenhouse gas emissions cap established pursuant to section
703.
``(g) Avoiding Double Counting.--The Administrator, in consultation
with the Secretary of State, shall seek, by whatever means appropriate,
including agreements, arrangements, or technical cooperation, to ensure
that activities on the basis of which international offset credits are
issued under this section are not used for compliance with an
obligation to reduce or avoid greenhouse gas emissions, or increase
greenhouse gas sequestration, under a foreign or international
regulatory system. In addition, no international offset credits shall
be issued for emission reductions from activities with respect to which
emission allowances were allocated under section 781 for distribution
under part E.
``(h) Limitation.--The Administrator shall not issue international
offset credits generated by projects based on the destruction of
hydrofluorocarbons.
``PART E--SUPPLEMENTAL EMISSIONS REDUCTIONS FROM REDUCED DEFORESTATION
``SEC. 751. DEFINITIONS.
``In this part:
``(1) Leakage prevention activities.--The term `leakage
prevention activities' means activities in developing countries
that are directed at preserving existing forest carbon stocks,
including forested wetlands and peatlands, that might, absent
such activities, be lost through leakage.
``(2) National deforestation reduction activities.--The
term `national deforestation reduction activities' means
activities in developing countries that reduce a quantity of
greenhouse gas emissions from deforestation that is calculated
by measuring actual emissions against a national deforestation
baseline established pursuant to section 754(d)(1) and (2).
``(3) Subnational deforestation reduction activities.--The
term `subnational deforestation reduction activities' means
activities in developing countries that reduce a quantity of
greenhouse gas emissions from deforestation that are calculated
by measuring actual emissions using an appropriate baseline
established by the Administrator that is less than national in
scope.
``(4) Supplemental emissions reductions.--The term
`supplemental emissions reductions' means greenhouse gas
emissions reductions achieved from reduced or avoided
deforestation under this part.
``(5) USAID.--The term `USAID' means the United States
Agency for International Development.
``SEC. 752. FINDINGS.
``Congress finds that--
``(1) as part of a global effort to mitigate climate
change, it is in the national interest of the United States to
assist developing countries to reduce and ultimately halt
emissions from deforestation;
``(2) deforestation is one of the largest sources of
greenhouse gas emissions in developing countries, amounting to
roughly 20 percent of overall emissions globally;
``(3) recent scientific analysis shows that it will be
substantially more difficult to limit the increase in global
temperatures to less than 2 degrees centigrade above
preindustrial levels without reducing and ultimately halting
net emissions from deforestation;
``(4) reducing emissions from deforestation is highly cost-
effective, compared to many other sources of emissions
reductions;
``(5) in addition to contributing significantly to
worldwide efforts to address global warming, assistance under
this part will generate significant environmental and social
cobenefits, including protection of biodiversity, ecosystem
services, and forest-related livelihoods; and
``(6) under the Bali Action Plan, developed country parties
to the United Nations Framework Convention on Climate Change,
including the United States, committed to `enhanced action on
the provision of financial resources and investment to support
action on mitigation and adaptation and technology
cooperation,' including, inter alia, consideration of `improved
access to adequate, predictable, and sustainable financial
resources and financial and technical support, and the
provision of new and additional resources, including official
and concessional funding for developing country parties' .
``SEC. 753. SUPPLEMENTAL EMISSIONS REDUCTIONS THROUGH REDUCED
DEFORESTATION.
``(a) Regulations.--Not later than 2 years after the date of
enactment of this title, the Administrator, in consultation with the
Administrator of USAID and any other appropriate agencies, shall
promulgate regulations establishing a program to use emission
allowances set aside for this purpose under section 781 to reduce
greenhouse gas emissions from deforestation in developing countries in
accordance with the requirements of this part.
``(b) Objectives.--The objectives of the program established under
this section shall be to--
``(1) achieve supplemental emissions reductions of at least
720,000,000 tons of carbon dioxide equivalent in 2020, a
cumulative amount of at least 6,000,000,000 tons of carbon
dioxide equivalent by December 31, 2025, and additional
supplemental emissions reductions in subsequent years;
``(2) build capacity to reduce deforestation in developing
countries experiencing deforestation, including preparing
developing countries to participate in international markets
for international offset credits for reduced emissions from
deforestation; and
``(3) preserve existing forest carbon stocks in countries
where such forest carbon may be vulnerable to international
leakage, particularly in developing countries with largely
intact native forests.
``SEC. 754. REQUIREMENTS FOR INTERNATIONAL DEFORESTATION REDUCTION
PROGRAM.
``(a) Eligible Countries.--The Administrator may support activities
under this part only with respect to a developing country that--
``(1) the Administrator, in consultation with the
Administrator of USAID, determines is experiencing
deforestation or forest degradation or has standing forest
carbon stocks that may be at risk of deforestation or
degradation; and
``(2) has entered into a bilateral or multilateral
agreement or arrangement with the United States establishing
the conditions of its participation in the program established
under this part, which shall include an agreement to meet the
standards established under subsection (d) for the activities
to which those standards apply.
``(b) Activities.--
``(1) Authorized activities.--Subject to the requirements
of this part, the Administrator, in consultation with the
Administrator of USAID, may support activities to achieve the
objectives identified in section 753(b), including--
``(A) national deforestation reduction activities;
``(B) subnational deforestation reduction
activities, including pilot activities that reduce
greenhouse gas emissions but are subject to significant
uncertainty;
``(C) activities to measure, monitor, and verify
deforestation, avoided deforestation, and deforestation
rates;
``(D) leakage prevention activities;
``(E) development of measurement, monitoring, and
verification capacities to enable a country to quantify
supplemental emissions reductions and to generate for
sale offset credits from reduced or avoided
deforestation;
``(F) development of governance structures to
reduce deforestation and illegal logging;
``(G) enforcement of requirements for reduced
deforestation or forest conservation;
``(H) efforts to combat illegal logging and
increase enforcement cooperation;
``(I) providing incentives for policy reforms to
achieve the objectives identified in section 753(b);
and
``(J) monitoring and evaluation of the results of
the activities conducted under this section.
``(2) Activities selected by usaid.--
``(A) The Administrator of USAID, in consultation
with the Administrator, may select for support and
implementation pursuant to subsection (c) any of the
activities described in paragraph (1), consistent with
this part and the regulations promulgated under
subsection (d), and subject to the requirement to
achieve the objectives listed in section 753(b)(1).
``(B) With respect to the activities listed in
subparagraphs (D) through (J) of paragraph (1), the
Administrator of USAID, in consultation with the
Administrator, shall have primary but not exclusive
responsibility for selecting the activities to be
supported and implemented.
``(3) Interagency coordination.--The Administrator and the
Administrator of USAID shall jointly develop and biennially
update a strategic plan for meeting the objectives listed in
section 753(b) and shall execute a memorandum of understanding
delineating the agencies' respective roles in implementing this
part.
``(c) Mechanisms.--
``(1) In general.--The Administrator may support activities
to achieve the objectives identified in section 753(b) by--
``(A) developing and implementing programs and
projects that achieve such objectives; and
``(B) distributing emission allowances to a country
that is eligible under subsection (a), to a private or
public group (including international organizations),
or to an international fund established by an
international agreement to which the United States is a
party, to carry out activities to achieve such
objectives.
``(2) USAID activities.--With respect to activities
selected and implemented by the Administrator of USAID pursuant
to subsection (b)(2), the Administrator shall distribute
emission allowances as provided in paragraph (1) of this
subsection based upon the direction of the Administrator of
USAID, subject to the availability of allowances for such
activities.
``(3) Implementation through international organizations.--
If support is distributed through an international
organization, the agency responsible for selecting activities
in accordance with subsection (b)(1) or (2), in consultation
with the Secretary of State, shall ensure the establishment and
implementation of adequate mechanisms to apply and enforce the
eligibility requirements and other requirements of this
section.
``(4) Role of the secretary of state.--The Administrator
may not distribute emission allowances under this part to the
government of another country or to an international
organization or international fund unless the Secretary of
State has concurred with such distribution.
``(d) Standards.--The Administrator, in consultation with the
Administrator of USAID, shall promulgate regulations establishing
standards to ensure that supplemental emissions reductions achieved
through supported activities are additional, measurable, verifiable,
permanent, and monitored, and account for leakage and uncertainty. In
addition, such standards shall--
``(1) require the establishment of a national deforestation
baseline for each country with national deforestation reduction
activities that is used to account for reductions achieved from
such activities;
``(2) provide that a national deforestation baseline
established under paragraph (1) shall--
``(A) be national in scope;
``(B) be consistent with nationally appropriate
mitigation commitments or actions with respect to
deforestation, taking into consideration the average
annual historical deforestation rates of the country
during a period of at least 5 years, the applicable
drivers of deforestation, and other factors to ensure
additionality;
``(C) establish a trajectory that would result in
zero net deforestation by not later than 20 years from
the date the baseline is established;
``(D) be adjusted over time to take account of
changing national circumstances;
``(E) be designed to account for all significant
sources of greenhouse gas emissions from deforestation
in the country; and
``(F) be consistent with the national deforestation
baseline, if any, established for such country under
section 743(e)(4);
``(3) with respect to support provided pursuant to
subsection (b)(1)(A) or (B), require supplemental emissions
reductions to be achieved and verified prior to compensation
through the distribution of emission allowances under this
part;
``(4) with respect to accounting for subnational
deforestation reduction activities that lack the standardized
or precise measurement and monitoring techniques needed for a
full accounting of changes in emissions or baselines, or are
subject to other sources of uncertainty, apply a conservative
discount factor to reflect the uncertainty regarding the levels
of reductions achieved;
``(5) ensure that activities under this part shall be
designed, carried out, and managed--
``(A) in accordance with widely accepted,
environmentally sustainable forest management
practices;
``(B) to promote or restore native forest species
and ecosystems where practicable, and to avoid the
introduction of invasive nonnative species;
``(C) in a manner that gives due regard to the
rights and interests of local communities, indigenous
peoples, forest-dependent communities, and vulnerable
social groups;
``(D) with consultations with, and full
participation of, local communities, indigenous
peoples, and forest-dependent communities in affected
areas, as partners and primary stakeholders, prior to
and during the design, planning, implementation, and
monitoring and evaluation of activities; and
``(E) with equitable sharing of profits and
benefits derived from the activities with local
communities, indigenous peoples, and forest-dependent
communities; and
``(6) with respect to support for all activities under this
part, seek to ensure the establishment and enforcement, by the
country in which the activities occur, of legal regimes,
standards, processes, and safeguards that--
``(A) give due regard to the rights and interests
of local communities, indigenous peoples, forest-
dependent communities, and vulnerable social groups;
``(B) promote consultations with local communities
and indigenous peoples and forest-dependent communities
in affected areas, as partners and primary
stakeholders, prior to and during the design, planning,
implementation, monitoring, and evaluation of
activities under this part; and
``(C) encourage equitable sharing of profits and
benefits from incentives for emissions reductions or
leakage prevention with local communities, indigenous
peoples, and forest-dependent communities.
``(e) Scope.--(1) The Administrator shall include within the scope
of activities under this part reduced emissions from forest
degradation.
``(2) The Administrator, in consultation with the Administrator of
USAID, may decide, taking into account any advice from the Advisory
Board, to expand, where appropriate, the scope of activities under this
part to include reduced soil carbon-derived emissions associated with
deforestation and degradation of forested wetlands and peatlands.
``(f) Accounting.--The Administrator shall establish a publicly
accessible registry of the supplemental emissions reductions achieved
through support provided under this part each year, after appropriately
discounting for uncertainty and other relevant factors as required by
the standards established under subsection (d).
``(g) Transition to National Reductions.--Beginning 5 years after
the date that a country entered into the agreement or arrangement
required under subsection (a)(2), the Administrator shall provide no
further compensation through emission allowances to that country under
this part for any subnational deforestation reduction activities,
except that the Administrator may extend this period by an additional 5
years if the Administrator, in consultation with the Administrator of
USAID, determines that--
``(1) the country is making substantial progress towards
adopting and implementing a program to achieve reductions in
deforestation measured against a national baseline;
``(2) the greenhouse gas emissions reductions achieved are
not resulting in significant leakage; and
``(3) the greenhouse gas emissions reductions achieved are
being appropriately discounted to account for any leakage that
is occurring.
The limitation under this subsection shall not apply to support for
activities to further the objectives listed in section 753(b)(2) or
(3).
``(h) Coordination With U.S. Foreign Assistance.--Subject to the
direction of the President, the Administrator and the Administrator of
USAID shall, to the extent practicable and consistent with the
objectives of this program, seek to align activities under this section
with broader development, poverty alleviation, or natural resource
management objectives and initiatives in the recipient country.
``(i) Support as Supplement.--The provision of support for
activities under this part shall be used to supplement, and not to
supplant, any other Federal, State, or local support available to carry
out such qualifying activities under this part.
``(j) Not Eligible for Offset Credit.--Activities that receive
support under this part shall not be issued offset credits for the
greenhouse gas emissions reductions or avoidance, or greenhouse gas
sequestration, produced by such activities.
``SEC. 755. REPORTS AND REVIEWS.
``(a) Reports.--Not later than January 1, 2014, and annually
thereafter, the Administrator and the Administrator of USAID shall
submit to the Committee on Energy and Commerce and the Committee on
Foreign Affairs of the House of Representatives, and the Committee on
Environment and Public Works and the Committee on Foreign Relations of
the Senate, and make available to the public, a report on the support
provided under this part during the prior fiscal year. The report shall
include--
``(1) a statement of the quantity of supplemental emissions
reductions for which compensation in the form of emission
allowances was provided under this part during the prior fiscal
year, as registered by the Administrator under section 754(f);
and
``(2) a description of the national and subnational
deforestation reduction activities, capacity-building
activities, and leakage prevention activities supported under
this part, including a statement of the quantity of emission
allowances distributed to each recipient for each activity
during the prior fiscal year, and a description of what was
accomplished through each of the activities.
``(b) Reviews.--Not later than 4 years after the date of enactment
of this title and every 5 years thereafter, the Administrator and the
Administrator of USAID, taking into consideration any evaluation by or
recommendations from the Advisory Board established under section 731,
shall conduct a review of the activities undertaken pursuant to this
part and make any appropriate changes in the program established under
this part, consistent with the requirements of this part, based on the
findings of the review. The review shall include the effects of the
activities on--
``(1) total documented carbon stocks of each country that
directly or indirectly received support under this part
compared with such country's national deforestation baseline
established under section 754(d)(1) and (2);
``(2) the number of countries with the capacity to generate
for sale instruments in the nature of offset credits from
forest-related activities, and the amount of such activities;
``(3) forest governance in each country that directly or
indirectly received support under this part;
``(4) indigenous peoples and forest-dependent communities
residing in areas affected by such activities;
``(5) biodiversity and ecosystem services within forested
areas associated with the activities;
``(6) subnational and international leakage; and
``(7) any program or mechanism established under the United
Nations Framework Convention on Climate Change related to
greenhouse gas emissions from deforestation.
``SEC. 756. LEGAL EFFECT OF PART.
``(1) In general.--Nothing in this part supersedes, limits,
or otherwise affects any restriction imposed by Federal law
(including regulations) on any interaction between an entity
located in the United States and an entity located in a foreign
country.
``(2) Role of the secretary of state.--Nothing in this part
shall be construed as affecting the role of the Secretary of
State or the responsibilities of the Secretary under section
622(c) of the Foreign Assistance Act of 1961.''.
SEC. 312. DEFINITIONS.
Title VII of the Clean Air Act, as added by section 311 of this
Act, is amended by inserting before part A the following new section:
``SEC. 700. DEFINITIONS.
``In this title:
``(1) Additional.--The term `additional', when used with
respect to reductions or avoidance of greenhouse gas emissions,
or to sequestration of greenhouse gases, means reductions,
avoidance, or sequestration that result in a lower level of net
greenhouse gas emissions or atmospheric concentrations than
would occur in the absence of an offset project.
``(2) Additionality.--The term `additionality' means the
extent to which reductions or avoidance of greenhouse gas
emissions, or sequestration of greenhouse gases, are
additional.
``(3) Advisory board.--The term `Advisory Board' means the
Offsets Integrity Advisory Board established under section 731.
``(4) Affiliated.--The term `affiliated'--
``(A) when used in relation to an entity means
owned or controlled by, or under common ownership or
control with, another entity, as determined by the
Administrator; and
``(B) when used in relation to a natural gas local
distribution company, means owned or controlled by, or
under common ownership or control with, another natural
gas local distribution company, as determined by the
Administrator.
``(5) Allowance.--The term `allowance' means a limited
authorization to emit, or have attributable greenhouse gas
emissions in an amount of, 1 ton of carbon dioxide equivalent
of a greenhouse gas in accordance with this title. Such term
includes an emission allowance, a compensatory allowance, and
an international emission allowance, but does not include an
international reserve allowance established under section 766.
``(6) Attributable greenhouse gas emissions.--The term
`attributable greenhouse gas emissions', for a given calendar
year, means--
``(A) for a covered entity that is a fuel producer
or importer described in paragraph (13)(B), greenhouse
gases that would be emitted from the combustion of any
petroleum-based or coal-based liquid fuel, petroleum
coke, or natural gas liquid, produced or imported by
that covered entity during that calendar year for sale
or distribution in interstate commerce, assuming no
capture and sequestration of any greenhouse gas
emissions;
``(B) for a covered entity that is an industrial
gas producer or importer described in paragraph
(13)(C), the tons of carbon dioxide equivalent of any
gas described in clauses (i) through (vi) of paragraph
(13)(C)--
``(i) produced or imported by such covered
entity during that calendar year for sale or
distribution in interstate commerce; or
``(ii) released as fugitive emissions in
the production of fluorinated gas; and
``(C) for a natural gas local distribution company
described in paragraph (13)(J), greenhouse gases that
would be emitted from the combustion of the natural
gas, and any other gas meeting the specifications for
commingling with natural gas for purposes of delivery,
that such entity delivered during that calendar year to
customers that are not covered entities, assuming no
capture and sequestration of that greenhouse gas.
``(7) Biological sequestration; biologically sequestered.--
The terms `biological sequestration' and `biologically
sequestered' mean the removal of greenhouse gases from the
atmosphere by terrestrial biological means, such as by growing
plants, and the storage of those greenhouse gases in plants or
soils.
``(8) Capped emissions.--The term `capped emissions' means
greenhouse gas emissions to which section 722 applies,
including emissions from the combustion of natural gas,
petroleum-based or coal-based liquid fuel, petroleum coke, or
natural gas liquid to which section 722(b)(2) or (8) applies.
``(9) Capped source.--The term `capped source' means a
source that directly emits capped emissions.
``(10) Carbon dioxide equivalent.--The term `carbon dioxide
equivalent' means the unit of measure, expressed in metric
tons, of greenhouse gases as provided under section 711 or 712.
``(11) Carbon stock.--The term `carbon stock' means the
quantity of carbon contained in a biological reservoir or
system which has the capacity to accumulate or release carbon.
``(12) Compensatory allowance.--The term `compensatory
allowance' means an allowance issued under section 721(f).
``(13) Covered entity.--The term `covered entity' means
each of the following:
``(A) Any electricity source.
``(B) Any stationary source that produces, and any
entity that (or any group of two or more affiliated
entities that, in the aggregate) imports, for sale or
distribution in interstate commerce in 2008 or any
subsequent year, petroleum-based or coal-based liquid
fuel, petroleum coke, or natural gas liquid, the
combustion of which would emit 25,000 or more tons of
carbon dioxide equivalent, as determined by the
Administrator.
``(C) Any stationary source that produces, and any
entity that (or any group of two or more affiliated
entities that, in the aggregate) imports, for sale or
distribution in interstate commerce, in bulk, or in
products designated by the Administrator, in 2008 or
any subsequent year 25,000 or more tons of carbon
dioxide equivalent of--
``(i) fossil fuel-based carbon dioxide;
``(ii) nitrous oxide;
``(iii) perfluorocarbons;
``(iv) sulfur hexafluoride;
``(v) any other fluorinated gas, except for
nitrogen trifluoride, that is a greenhouse gas,
as designated by the Administrator under
section 711; or
``(vi) any combination of greenhouse gases
described in clauses (i) through (v).
``(D) Any stationary source that has emitted 25,000
or more tons of carbon dioxide equivalent of nitrogen
trifluoride in 2008 or any subsequent year.
``(E) Any geologic sequestration site.
``(F) Any stationary source in the following
industrial sectors:
``(i) Adipic acid production.
``(ii) Primary aluminum production.
``(iii) Ammonia manufacturing.
``(iv) Cement production, excluding
grinding-only operations.
``(v) Hydrochlorofluorocarbon production.
``(vi) Lime manufacturing.
``(vii) Nitric acid production.
``(viii) Petroleum refining.
``(ix) Phosphoric acid production.
``(x) Silicon carbide production.
``(xi) Soda ash production.
``(xii) Titanium dioxide production.
``(xiii) Coal-based liquid or gaseous fuel
production.
``(G) Any stationary source in the chemical or
petrochemical sector that, in 2008 or any subsequent
year--
``(i) produces acrylonitrile, carbon black,
ethylene, ethylene dichloride, ethylene oxide,
or methanol; or
``(ii) produces a chemical or petrochemical
product if producing that product results in
annual combustion plus process emissions of
25,000 or more tons of carbon dioxide
equivalent.
``(H) Any stationary source that--
``(i) is in one of the following industrial
sectors: ethanol production; ferroalloy
production; fluorinated gas production; food
processing; glass production; hydrogen
production; iron and steel production; lead
production; pulp and paper manufacturing; and
zinc production; and
``(ii) has emitted 25,000 or more tons of
carbon dioxide equivalent in 2008 or any
subsequent year.
``(I) Any fossil fuel-fired combustion device (such
as a boiler) or grouping of such devices that--
``(i) is all or part of an industrial
source not specified in subparagraph (D), (F),
(G), or (H); and
``(ii) has emitted 25,000 or more tons of
carbon dioxide equivalent in 2008 or any
subsequent year.
``(J) Any natural gas local distribution company
that (or any group of 2 or more affiliated natural gas
local distribution companies that, in the aggregate),
in 2008 or any subsequent year, delivers 460,000,000
cubic feet or more of natural gas, and any other gas
meeting the specifications for commingling with natural
gas for purposes of delivery, to customers that are not
covered entities.
``(14) Crediting period.--The term `crediting period' means
the period with respect to which an offset project is eligible
to earn offset credits under part D, as determined under
section 734(c).
``(15) Designated representative.--The term `designated
representative' means, with respect to a covered entity, a
reporting entity (as defined in section 713), an offset project
developer, or any other entity receiving or holding allowances,
offset credits, or term offset credits under this title, an
individual authorized, through a certificate of representation
submitted to the Administrator by the owners and operators or
similar entity official, to represent the owners and operators
or similar entity official in all matters pertaining to this
title (including the holding, transfer, or disposition of
allowances or offset credits), and to make all submissions to
the Administrator under this title.
``(16) Developing country.--The term `developing country'
means a country eligible to receive official development
assistance according to the income guidelines of the
Development Assistance Committee of the Organization for
Economic Cooperation and Development.
``(17) Domestic offset credit.--For purposes of part D, the
term `domestic offset credit' means an offset credit issued
under part D, other than an international offset credit. For
purposes of part C, the term means any offset credit issued
under the American Clean Energy and Security Act of 2009, or
the amendments made thereby. The term does not include a term
offset credit.
``(18) Electricity source.--The term `electricity source'
means a stationary source that includes one or more utility
units.
``(19) Emission.--The term `emission' means the release of
a greenhouse gas into the ambient air. Such term does not
include gases that are captured and geologically sequestered,
except to the extent that they are later released into the
atmosphere, in which case compliance must be demonstrated
pursuant to section 722(b)(5).
``(20) Emission allowance.--The term `emission allowance'
means an allowance established under section 721(a) or section
726(g)(2) or (h)(1)(C).
``(21) Fair market value.--The term `fair market value'
means the average daily closing price on registered exchanges
or, if such a price is unavailable, the average price as
determined by the Administrator, during a specified time
period, of an emission allowance.
``(22) Federal land.--The term `Federal land' means land
that is owned by the United States, other than land held in
trust for an Indian or Indian tribe.
``(23) Fossil fuel.--The term `fossil fuel' means natural
gas, petroleum, or coal, or any form of solid, liquid, or
gaseous fuel derived from such material, including consumer
products that are derived from such materials and are
combusted.
``(24) Fossil fuel-fired.--The term `fossil fuel-fired'
means powered by combustion of fossil fuel, alone or in
combination with any other fuel, regardless of the percentage
of fossil fuel consumed.
``(25) Fugitive emissions.--The term `fugitive emissions'
means emissions from leaks, valves, joints, or other small
openings in pipes, ducts, or other equipment, or from vents.
``(26) Geologic sequestration; geologically sequestered.--
The terms `geologic sequestration' and `geologically
sequestered' mean the sequestration of greenhouse gases in
subsurface geologic formations for purposes of permanent
storage.
``(27) Geologic sequestration site.--The term `geologic
sequestration site' means a site where carbon dioxide is
geologically sequestered.
``(28) Greenhouse gas.--The term `greenhouse gas' means any
gas described in section 711(a) or designated under section
711, except to the extent that it is regulated under title VI.
``(29) Hold.--The term `hold' means, with respect to an
allowance, offset credit, or term offset credit, to have in the
appropriate account in the allowance tracking system
established under section 724(d), or submit to the
Administrator for recording in such account.
``(30) Industrial source.--The term `industrial source'
means any stationary source that--
``(A) is not an electricity source; and
``(B) is in--
``(i) the manufacturing sector (as defined
in North American Industrial Classification
System codes 31, 32, and 33); or
``(ii) the natural gas processing or
natural gas pipeline transportation sector (as
defined in North American Industrial
Classification System codes 211112 and 486210).
``(31) International emission allowance.--The term
`international emission allowance' means a tradable
authorization to emit 1 ton of carbon dioxide equivalent of
greenhouse gas that is issued by a national or supranational
foreign government pursuant to a qualifying international
program designated by the Administrator pursuant to section
728(a).
``(32) International offset credit.--The term
`international offset credit' means an offset credit issued by
the Administrator under section 743.
``(33) Leakage.--Except as provided in part F, the term
`leakage' means a significant increase in greenhouse gas
emissions, or significant decrease in sequestration, which is
caused by an offset project or activities under part E and
occurs outside the boundaries of the offset project or the
relevant program or project under part E.
``(34) Mineral sequestration.--The term `mineral
sequestration' means sequestration of carbon dioxide from the
atmosphere by capturing carbon dioxide into a permanent
mineral, such as the aqueous precipitation of carbonate
minerals that results in the storage of carbon dioxide in a
mineral form.
``(35) Natural gas liquid.--The term `natural gas liquid'
means ethane, butane, isobutane, natural gasoline, and propane.
``(36) Natural gas local distribution company.--The term
`natural gas local distribution company' has the meaning given
the term `local distribution company' in section 2(17) of the
Natural Gas Policy Act of 1978 (15 U.S.C. 3301(17)).
``(37) Offset credit.--For purposes of this section and
part D, the term `offset credit' means an offset credit issued
under part D. For purposes of part C, the term means any offset
credit issued under the American Clean Energy and Security Act
of 2009, or the amendments made thereby. The term does not
include a term offset credit.
``(38) Offset project.--The term `offset project' means a
project or activity that reduces or avoids greenhouse gas
emissions, or sequesters greenhouse gases, and for which offset
credits are or may be issued under part D.
``(39) Offset project developer.--The term `offset project
developer' means the individual or entity designated as the
offset project developer in an offset project approval petition
under section 735(c)(1).
``(40) Petroleum.--The term `petroleum' includes crude oil,
tar sands, oil shale, and heavy oils.
``(41) Renewable biomass.--The term `renewable biomass'
means any of the following:
``(A) Materials, pre-commercial thinnings, or
removed invasive species from National Forest System
land and public lands (as defined in section 103 of the
Federal Land Policy and Management Act of 1976 (43
U.S.C. 1702)), including those that are byproducts of
preventive treatments (such as trees, wood, brush,
thinnings, chips, and slash), that are removed as part
of a federally recognized timber sale, or that are
removed to reduce hazardous fuels, to reduce or contain
disease or insect infestation, or to restore ecosystem
health, and that are--
``(i) not from components of the National
Wilderness Preservation System, Wilderness
Study Areas, Inventoried Roadless Areas, old
growth stands, late-successional stands (except
for dead, severely damaged, or badly infested
trees), components of the National Landscape
Conservation System, National Monuments,
National Conservation Areas, Designated
Primitive Areas, or Wild and Scenic Rivers
corridors;
``(ii) harvested in environmentally
sustainable quantities, as determined by the
appropriate Federal land manager; and
``(iii) harvested in accordance with
Federal and State law, and applicable land
management plans.
``(B) Any organic matter that is available on a
renewable or recurring basis from non-Federal land or
land belonging to an Indian or Indian tribe that is
held in trust by the United States or subject to a
restriction against alienation imposed by the United
States, including--
``(i) renewable plant material, including--
``(I) feed grains;
``(II) other agricultural
commodities;
``(III) other plants and trees; and
``(IV) algae; and
``(ii) waste material, including--
``(I) crop residue;
``(II) other vegetative waste
material (including wood waste and wood
residues);
``(III) animal waste and byproducts
(including fats, oils, greases, and
manure);
``(IV) construction waste; and
``(V) food waste and yard waste.
``(C) Residues and byproducts from wood, pulp, or
paper products facilities.
``(42) Retire.--The term `retire', with respect to an
allowance, offset credit, or term offset credit, established or
issued under the American Clean Energy and Security Act of 2009
or the amendments made thereby, means to disqualify such
allowance or offset credit for any subsequent use under this
title, regardless of whether the use is a sale, exchange, or
submission of the allowance, offset credit, or term offset
credit to satisfy a compliance obligation.
``(43) Reversal.--The term `reversal' means an intentional
or unintentional loss of sequestered greenhouse gases to the
atmosphere.
``(44) Sequestered and sequestration.--The terms
`sequestered' and `sequestration' mean the separation,
isolation, or removal of greenhouse gases from the atmosphere,
as determined by the Administrator. The terms include
biological, geologic, and mineral sequestration, but do not
include ocean fertilization techniques.
``(45) Stationary source.--The term `stationary source'
means any integrated operation comprising any plant, building,
structure, or stationary equipment, including support buildings
and equipment, that is located within one or more contiguous or
adjacent properties, is under common control of the same person
or persons, and emits or may emit a greenhouse gas.
``(46) Strategic reserve allowance.--The term `strategic
reserve allowance' means an emission allowance reserved for,
transferred to, or deposited in the strategic reserve under
section 726.
``(47) Ton.--The term `ton' means metric ton.
``(48) Uncapped emissions.--The term `uncapped emissions'
means emissions of greenhouse gases emitted after December 31,
2011, that are not capped emissions.
``(49) United states greenhouse gas emissions.--The term
`United States greenhouse gas emissions' means the total
quantity of annual greenhouse gas emissions from the United
States, as calculated by the Administrator and reported to the
United Nations Framework Convention on Climate Change
Secretariat.
``(50) Utility unit.--The term `utility unit' means a
combustion device that, on January 1, 2009, or any date
thereafter, is fossil fuel-fired and serves a generator that
produces electricity for sale, unless such combustion device,
during the 12-month period starting the later of January 1,
2009, or the commencement of commercial operation and each
calendar year starting after such later date--
``(A) is part of an integrated cycle system that
cogenerates steam and electricity during normal
operation and that supplies one-third or less of its
potential electric output capacity and 25 MW or less of
electrical output for sale; or
``(B) combusts materials of which more than 95
percent is municipal solid waste on a heat input basis.
``(51) Vintage year.--The term `vintage year' means the
calendar year for which an emission allowance is established
under section 721(a) or which is assigned to an emission
allowance under section 726(g)(3)(A), except that the vintage
year for a strategic reserve allowance shall be the year in
which such allowance is purchased at auction.''.
Subtitle B--Disposition of Allowances
SEC. 321. DISPOSITION OF ALLOWANCES FOR GLOBAL WARMING POLLUTION
REDUCTION PROGRAM.
Title VII of the Clean Air Act, as added by section 311 of this
Act, is amended by adding at the end the following part:
``PART H--DISPOSITION OF ALLOWANCES
``SEC. 781. ALLOCATION OF ALLOWANCES FOR SUPPLEMENTAL REDUCTIONS.
``(a) In General.--The Administrator shall allocate for each
vintage year the following percentage of the emission allowances
established under section 721(a), for distribution in accordance with
part E:
``(1) For vintage years 2012 through 2025, 5 percent.
``(2) For vintage years 2026 through 2030, 3 percent.
``(3) For vintage years 2031 through 2050, 2 percent.
``(b) Adjustment.--The Administrator shall modify the percentages
set forth in subsection (a) as necessary to ensure the achievement of
the annual supplemental emission reduction objective for 2020, and the
cumulative reduction objective through 2025, set forth in section
753(b)(1).
``(c) Carryover.--If the Administrator has not distributed all of
the allowances allocated pursuant to this section for a given vintage
year by the end of that year, all such undistributed emission
allowances shall, in accordance with section 782(s), be exchanged for
allowances from the following vintage year and treated as part of the
allocation for supplemental reductions under this section for that
later vintage year.
``SEC. 782. ALLOCATION OF EMISSION ALLOWANCES.
``(a) Electricity Consumers.--(1) The Administrator shall allocate
emission allowances for the benefit of electricity consumers, to be
distributed in accordance with section 783(b), (c), and (d) in the
following amounts:
``(A) For vintage years 2012 and 2013: 43.75 percent of the
emission allowances established for each year under section
721(a).
``(B) For vintage years 2014 and 2015: 38.89 percent of the
emission allowances established for each year under section
721(a).
``(C) For vintage years 2016 through 2025: 35.00 percent of
the emission allowances established for each year under section
721(a).
``(D) For vintage year 2026: 28 percent of the emission
allowances established for that year under section 721(a).
``(E) For vintage year 2027: 21 percent of the emission
allowances established for that year under section 721(a).
``(F) For vintage year 2028: 14 percent of the emission
allowances established for that year under section 721(a).
``(G) For vintage year 2029: 7 percent of the emission
allowances established for that year under section 721(a).
``(2) The Administrator shall allocate emission allowances for
energy efficiency, renewable electricity, and low income ratepayer
assistance programs administered by small electricity local
distribution companies, to be distributed in accordance with section
783(e) in the following amounts:
``(A) For vintage years 2012 through 2025: 0.5 percent of
the emission allowances established each year under section
721(a).
``(B) For vintage year 2026: 0.4 percent of the emission
allowances established for that year under section 721(a).
``(C) For vintage year 2027: 0.3 percent of the emission
allowances established for that year under section 721(a).
``(D) For vintage year 2028: 0.2 percent of the emission
allowances established for that year under section 721(a).
``(E) For vintage year 2029: 0.1 percent of the emission
allowances established for that year under section 721(a).
``(3) For vintage year 2012, the Administrator shall allocate 0.35
percent of emission allowances established for such year under section
721(a) to avoid disincentives to the continued use of existing energy-
efficient cogeneration facilities at industrial parks, to be
distributed in accordance with section 783(f).
``(b) Natural Gas Consumers.--The Administrator shall allocate
emission allowances for the benefit of natural gas consumers to be
distributed in accordance with section 784 in the following amounts:
``(1) For vintage years 2016 through 2025, 9 percent of the
emission allowances established for each year under section
721(a).
``(2) For vintage year 2026, 7.2 percent of the emission
allowances established for that year under section 721(a).
``(3) For vintage year 2027, 5.4 percent of the emission
allowances established for that year under section 721(a).
``(4) For vintage year 2028, 3.6 percent of the emission
allowances established for that year under section 721(a).
``(5) For vintage year 2029, 1.8 percent of the emission
allowances established for that year under section 721(a).
``(c) Home Heating Oil and Propane Consumers.--The Administrator
shall allocate emission allowances for the benefit of home heating oil
and propane consumers to be distributed in accordance with section 785
in the following amounts:
``(1) For vintage years 2012 and 2013, 1.875 percent of the
emission allowances established for each year under section
721(a).
``(2) For vintage years 2014 and 2015, 1.67 percent of the
emission allowances established for each year under section
721(a).
``(3) For vintage years 2016 through 2025, 1.5 percent of
the emission allowances established for each year under section
721(a).
``(4) For vintage year 2026, 1.2 percent of the emission
allowances established for that year under section 721(a).
``(5) For vintage year 2027, 0.9 percent of the emission
allowances established for that year under section 721(a).
``(6) For vintage year 2028, 0.6 percent of the emission
allowances established for that year under section 721(a).
``(7) For vintage year 2029, 0.3 percent of the emission
allowances established for that year under section 721(a).
``(d) Low Income Consumers.--For each vintage year starting in
2012, the Administrator shall auction, pursuant to section 791, 15
percent of the emission allowances established for each year under
section 721(a), with the proceeds used for the benefit of low income
consumers to fund the program set forth in subtitle C of title IV of
American Clean Energy and Security Act of 2009 and the amendments made
thereby.
``(e) Trade-vulnerable Industries.--
``(1) In general.--The Administrator shall allocate
emission allowances to energy-intensive, trade-exposed
entities, to be distributed in accordance with section 765, in
the following amounts:
``(A) For vintage years 2012 and 2013, up to 2.0
percent of the emission allowances established for each
year under section 721(a).
``(B) For vintage year 2014, up to 15 percent of
the emission allowances established for that year under
section 721(a).
``(C) For vintage year 2015, up to the product of--
``(i) the amount specified in paragraph
(2); multiplied by
``(ii) the quantity of emission allowances
established for 2015 under section 721(a)
divided by the quantity of emission allowances
established for 2014 under section 721(a).
``(D) For vintage year 2016, up to the product of--
``(i) the amount specified in paragraph
(3); multiplied by
``(ii) the quantity of emission allowances
established for 2015 under section 721(a)
divided by the quantity of emission allowances
established for 2014 under section 721(a).
``(E) For vintage years 2017 through 2025, up to
the product of--
``(i) the amount specified in paragraph
(4); multiplied by
``(ii) the quantity of emission allowances
established for that year under section 721(a)
divided by the quantity of emission allowances
established for 2016 under section 721(a).
``(F) For vintage years 2026 through 2050, up to
the product of the amount specified in paragraph (4)--
``(i) multiplied by the quantity of
emission allowances established for the
applicable year during 2026 through 2050 under
section 721(a) divided by the quantity of
emission allowances established for 2016 under
section 721(a); and
``(ii) multiplied by a factor that shall
equal 90 percent for 2026 and decline 10
percent for each year thereafter until reaching
zero, except that, if the President modifies a
percentage for a year under subparagraph (A) of
section 767(c)(3), the highest percentage the
President applies for any sector under that
subparagraph for that year (not exceeding 100
percent) shall be used for that year instead of
the factor otherwise specified in this clause.
``(2) Carryover.--After the Administrator distributes
emission allowances pursuant to section 765 for any given
vintage year, any emission allowances allocated to energy-
intensive, trade-exposed entities pursuant to this subsection
that have not been so distributed shall, in accordance with
subsection (s), be exchanged for allowances from the following
vintage year and treated as part of the allocation to such
entities for that later vintage year.
``(f) Deployment of Carbon Capture and Sequestration Technology.--
``(1) Annual allocation.--The Administrator shall allocate
emission allowances for the deployment of carbon capture and
sequestration technology to be distributed in accordance with
section 786 in the following amounts:
``(A) For vintage years 2014 through 2017, 1.75
percent of the emission allowances established for each
year under section 721(a).
``(B) For vintage years 2018 and 2019, 4.75 percent
of the emission allowances established for each year
under section 721(a).
``(C) For vintage years 2020 through 2050, 5
percent of the emission allowances established for each
year under section 721(a).
``(2) Carryover.--If the Administrator has not distributed
all of the allowances allocated pursuant to this subsection for
a given vintage year by the end of that year, all such
undistributed emission allowances shall, in accordance with
subsection (s), be exchanged for allowances from the following
vintage year and treated as part of the allocation for the
deployment of carbon capture and sequestration technology under
this subsection for that later vintage year.
``(g) Investment in Energy Efficiency and Renewable Energy.--The
Administrator shall allocate emission allowances to invest in energy
efficiency and renewable energy as follows:
``(1) To be distributed in accordance with section 132 of
the American Clean Energy and Security Act of 2009 in the
following amounts:
``(A) For vintage years 2012 through 2015, 9.5
percent of the emission allowances established for each
year under section 721(a).
``(B) For vintage years 2016 through 2017, 6.5
percent of the emission allowances established for each
year under section 721(a).
``(C) For vintage years 2018 through 2021, 5.5
percent of the emission allowances established for each
year under section 721(a).
``(D) For vintage years 2022 through 2025, 1.0
percent of the emission allowances established for each
year under section 721(a).
``(E) For vintage years 2026 through 2050, 4.5
percent of the emission allowances established for each
year under section 721(a).
``(F) At the same time allowances are distributed
under subparagraph (D) for each of the vintage years
2022 through 2025, 3.55 percent of emission allowances
established under section 721(a) for the vintage year 4
years after that vintage year shall also be distributed
(which shall be in addition to the emission allowances
distributed under subparagraph (E)).
``(2) To be distributed in accordance with section 304 of
the Energy Conservation and Production Act, as amended by
section 201 of the American Clean Energy and Security Act of
2009, for each vintage year from 2012 through 2050, 0.5 percent
of emission allowances established for that year under section
721(a).
``(3) To be distributed among the States in accordance with
the formula in section 132(b) of the American Clean Energy and
Security Act of 2009 and to be used exclusively for the
purposes of section 202 of the American Clean Energy and
Security Act of 2009 in the following amounts:
``(A) For vintage years 2012 through 2017, 0.05
percent of the emission allowances established for each
year under section 721(a).
``(B) For vintage years 2018 through 2050, 0.03
percent of the emission allowances established for each
year under section 721(a).
``(h) Energy Research and Development.--
``(1) Energy innovation hubs.--For vintage years 2012
through 2050, the Administrator shall allocate 0.45 percent of
the emission allowances established under section 721(a) to be
distributed to Energy Innovation Hubs in accordance with
section 171 of the American Clean Energy and Security Act of
2009.
``(2) Advanced energy research.--For vintage years 2012
through 2050, the Administrator shall allocate 1.05 percent of
the emission allowances established under section 721(a) for
the Advanced Research Project Agency-Energy to be distributed
in accordance with section 172 of the American Clean Energy and
Security Act of 2009.
``(i) Investment in Clean Vehicle Technology.--The Administrator
shall allocate emission allowances to invest in the development and
deployment of clean vehicles, to be distributed in accordance with
section 124 of the American Clean Energy and Security Act of 2009 in
the following amounts:
``(1) For vintage years 2012 through 2017, 3 percent of the
emission allowances established for each year under section
721(a).
``(2) For vintage years 2018 through 2025, 1 percent of the
emission allowances established for each year under section
721(a).
``(j) Domestic Fuel Production.--For vintage years 2014 through
2026, the Administrator shall allocate and distribute according to
section 787--
``(1) 2 percent of the emission allowances established for
each year under section 721(a) to domestic petroleum refineries
that are covered entities pursuant to section 700(13)(F)(viii),
including small business refiners; and
``(2) an additional 0.25 percent of the emissions
allowances established for each year under section 721(a) to
small business refiners that are covered entities pursuant to
section 700(13)(F)(viii).
``(k) Investment in Workers.--(1) The Administrator shall auction
pursuant to section 791 emission allowances for the benefit of workers
pursuant to part 2 of subtitle B of the American Clean Energy and
Security Act of 2009 in the following amounts, and shall deposit into
the Climate Change Worker Adjustment Assistance Fund established
pursuant to section 793, and report to the Secretary of Labor on, the
proceeds from the sale of these allowances:
``(A) For vintage years 2012 through 2021, 0.5 percent of the
emission allowances established for each year under section 721(a).
``(B) For vintage years 2022 through 2050, 1.0 percent of the
emission allowances established for each year under section 721(a).
All amounts deposited into the fund shall be available to the Secretary
of Labor until expended to carry out part 2 of subtitle B of title IV
of the American Clean Energy and Security Act of 2009. Of the amounts
deposited, not more than $10,000,000 shall be available to the
Secretary of Labor for Federal administration costs of such part 2 each
fiscal year.
``(2) The Administrator shall auction, pursuant to section 791,
0.75 percent of the emission allowances established for each of vintage
years 2012 and 2013 under section 721(a), and shall deposit the
proceeds in the Energy Efficiency and Renewable Energy Worker Training
Fund established by section 422 of the American Clean Energy and
Security Act of 2009.
``(l) Domestic Adaptation.--The Administrator shall allocate
emission allowances for domestic adaptation as follows:
``(1) To be distributed in accordance with section 453 of
the American Clean Energy and Security Act of 2009 in the
following amounts:
``(A) For vintage years 2012 through 2021, 0.9
percent of the emission allowances established for each
year under section 721(a).
``(B) For vintage years 2022 through 2026, 1.9
percent of the emission allowances established for each
year under section 721(a).
``(C) For vintage years 2027 through 2050, 3.9
percent of the emission allowances established for each
year under section 721(a).
``(2) For vintage year 2012 and thereafter, the
Administrator shall auction, pursuant to section 791, 0.1
percent of the emission allowances established for each year
under section 721(a), and shall deposit the proceeds in the
Climate Change Health Protection and Promotion Fund established
by section 467 of the American Clean Energy and Security Act of
2009.
``(m) Wildlife and Natural Resource Adaptation.--The Administrator
shall allocate emission allowances for wildlife and natural resource
adaptation as follows:
``(1) To be distributed to State agencies in accordance
with section 480(a) of the American Clean Energy and Security
Act of 2009 in the following amounts:
``(A) For vintage years 2012 through 2021, 0.385
percent of the emission allowances established for each
year under section 721(a).
``(B) For vintage years 2022 through 2026, 0.77
percent of the emission allowances established for each
year under section 721(a).
``(C) For vintage years 2027 through 2050, 1.54
percent of the emission allowances established for each
year under section 721(a).
``(2) To be auctioned pursuant to section 791, with the
proceeds to be deposited in the Natural Resources Climate
Change Adaptation Fund established pursuant to section 480(b),
in the following amounts:
``(A) For vintage years 2012 through 2021, 0.615
percent of the emission allowances established for each
year under section 721(a).
``(B) For vintage years 2022 through 2026, 1.23
percent of the emission allowances established for each
year under section 721(a).
``(C) For vintage years 2027 through 2050, 2.46
percent of the emission allowances established for each
year under section 721(a).
``(n) International Adaptation.--The Administrator shall allocate
emission allowances for international adaptation to be distributed in
accordance with part 2 of subtitle E of title IV of the American Clean
Energy and Security Act of 2009 in the following amounts:
``(1) For vintage years 2012 through 2021, 1.0 percent of
the emission allowances established for each year under section
721(a).
``(2) For vintage years 2022 through 2026, 2.0 percent of
the emission allowances established for each year under section
721(a).
``(3) For vintage years 2027 through 2050, 4.0 percent of
the emission allowances established for each year under section
721(a).
``(o) International Clean Technology Deployment.--The Administrator
shall allocate emission allowances for international clean technology
deployment for distribution in accordance with subtitle D of title IV
of the American Clean Energy and Security Act of 2009 in the following
amounts:
``(1) For vintage years 2012 through 2021, 1.0 percent of
the emission allowances established for each year under section
721(a).
``(2) For vintage years 2022 through 2026, 2.0 percent of
the emission allowances established for each year under section
721(a).
``(3) For vintage years 2027 through 2050, 4.0 percent of
the emission allowances established for each year under section
721(a).
``(p) Release of Future Allowances.--The Administrator shall make
future year allowances available by auctioning allowances, pursuant to
section 791, in the following amounts:
``(1) In each of calendar years 2014 through 2019, a string
of 0.70 billion allowances with vintage years 12 to 17 years
after the year of the auction, with an equal number of
allowances from each vintage year in the string.
``(2) In each of calendar years 2020 through 2025, a string
of 0.50 billion allowances with vintage years 12 to 17 years
after the year of the auction, with an equal number of
allowances from each vintage year in the string.
``(3) In each of calendar years 2026 through 2030, a string
of 0.3 billion allowances with vintage years 12 to 17 years
after the year of the auction, with an equal number of
allowances from each vintage year in the string.
``(q) Deficit Reduction.--
``(1) For each of vintage years 2012 through 2025, any
allowances not allocated for distribution or auction pursuant
to section 781 or subsections (a) through (o) and subsections
(s) and (t) of this section, or disbursed pursuant to section
790, shall be auctioned by the Administrator pursuant to
section 791 and the proceeds shall be deposited into the
Treasury.
``(2) Unless otherwise specified, any allowances allocated
pursuant to subsections (a) through (o) and subsections (s) and
(t) and not distributed by March 31 of the calendar year
following the allowance's vintage year, shall be auctioned by
the Administrator and the proceeds shall be deposited into the
Treasury.
``(3) For auctions conducted through calendar year 2020
pursuant to subsection (p), the auction proceeds shall be
deposited into the Treasury.
``(r) Climate Change Consumer Refund.--
``(1) For each of vintage years 2026 through 2050, the
Administrator shall auction the following allowances
established under section 721(a) and deposit the proceeds into
the Climate Change Consumer Refund Account:
``(A) Any allowances not allocated for distribution
or auction pursuant to section 781 or subsections (a)
through (p) of this section, or disbursed pursuant to
section 790.
``(B) Unless otherwise specified, any allowances
allocated pursuant to subsections (a) through (o) and
not distributed by March 31 of the calendar year
following the allowance's vintage year.
``(2) For auctions conducted pursuant to subsection (p) in
calendar years 2021 and thereafter, the Administrator shall
place the proceeds from the sales of the these allowances into
the Climate Change Consumer Refund Account.
``(3) Funds deposited into the Climate Change Consumer
Refund Account shall be used as specified in section 789 and
shall be available for expenditure, without further
appropriation or fiscal year limitation.
``(s) Treatment of Carryover Allowances.--
``(1) In general.--If there are undistributed allowances
from a vintage year for supplemental reductions pursuant to
section 781(c), energy-intensive, trade-exposed industries
pursuant to subsection (e)(2) of this section, deployment of
carbon capture and sequestration technology pursuant to
subsection (f)(2) of this section, or supplemental agriculture
and renewable energy pursuant to subsection (u)(2) of this
section, the Administrator shall--
``(A) use the undistributed allowances to increase
for the same vintage year--
``(i) the allocation of allowances to be
auctioned for deficit reduction pursuant to
subsection (q) or for consumer refunds pursuant
to subsection (r);
``(ii) the allocation of allowances to be
auctioned for low income consumers pursuant to
subsection (d); or
``(iii) a combination of both; and
``(B) except as provided in paragraph (2)--
``(i) decrease by the same amount for the
following vintage year the allocation for the
purpose for which the allocation was increased
pursuant to subparagraph (A); and
``(ii) increase by the same amount for the
following vintage year the allocation for the
purpose for which the undistributed allowances
were originally allocated.
``(2) Excess undistributed allowances.--(A) For each
vintage year for which this subsection applies, the
Administrator shall determine whether--
``(i) the total quantity of undistributed
allowances for that vintage year that were allocated
pursuant to section 781(c), and subsections (e)(2),
(f)(2), and (u)(2) of this section, exceeds
``(ii) the total quantity of allowances allocated
pursuant to subsection (d), (q) and (r) for the
following vintage year, decreased by the quantity of
allowances for that following vintage year set aside
for the reserve established by section 791(f).
``(B) If the Administrator determines under subparagraph
(A) that the quantity described in subparagraph (A)(i) exceeds
the quantity described in subparagraph (A)(ii), paragraph
(1)(B)(ii) of this subsection shall not apply. Instead, for
each purpose described in section 781(c), or subsections
(e)(2), (f)(2), and (u)(2) of this section for which
undistributed allowances for a given vintage year were
allocated, the Administrator shall increase the allocation for
the following vintage year by the amount that is the product
of--
``(i) the number of undistributed allowances for
that purpose, times
``(ii) the quantity described in subparagraph
(A)(ii) divided by the quantity described in
subparagraph (A)(i).
``(t) Compensation for Early Actors.--For vintage year 2012, the
Administrator shall allocate for compensation for early actors 1
percent of emission allowances established under section 721(a), to be
distributed in accordance with section 795 of the American Clean Energy
and Security Act of 2009.
``(u) Supplemental Agriculture and Renewable Energy.--
``(1) In general.--For vintage years 2012 through 2016, the
Administrator shall allocate 0.28 percent of emission
allowances established under section 721(a), to be distributed
in accordance with section 788 of the American Clean Energy and
Security Act of 2009.
``(2) Carryover.--After the Administrator distributes
emission allowances pursuant to section 788 for any given
vintage year, any emission allowances allocated to supplemental
agriculture and renewable energy pursuant to this subsection
that have not been so distributed shall, in accordance with
subsection (s), be exchanged for allowances from the following
vintage year and treated as part of the allocation to such
entities for that later vintage year.
``SEC. 783. ELECTRICITY CONSUMERS.
``(a) Definitions.--For purposes of this section:
``(1) Coal-fueled unit.--The term `coal-fueled unit' means
a utility unit that derives at least 85 percent of its heat
input from coal, petroleum coke, or any combination of these 2
fuels.
``(2) Electricity local distribution company.--The term
`electricity local distribution company' means an electric
utility--
``(A) that has a legal, regulatory, or contractual
obligation to deliver electricity directly to retail
consumers in the United States, regardless of whether
that entity or another entity sells the electricity as
a commodity to those retail consumers; and
``(B) the retail rates of which, except in the case
of an electric cooperative, are regulated or set by--
``(i) a State regulatory authority;
``(ii) a State or political subdivision
thereof (or an agency or instrumentality of, or
corporation wholly owned by, either of the
foregoing); or
``(iii) an Indian tribe pursuant to tribal
law.
``(3) Electricity savings; renewable energy resource.--The
terms `electricity savings' and `renewable energy resource'
shall have the meaning given those terms in section 610 of the
Public Utility Regulatory Policies Act of 1978 (as added by
section 101 of the American Clean Energy and Security Act of
2009).
``(4) Independent power production facility.--The term
`independent power production facility' means a facility--
``(A) that is used for the generation of electric
energy, at least 80 percent of which is sold at
wholesale; and
``(B) the sales of the output of which are not
subject to retail rate regulation or setting of retail
rates by--
``(i) a State regulatory authority;
``(ii) a State or political subdivision
thereof (or an agency or instrumentality of, or
corporation wholly owned by, either of the
foregoing);
``(iii) an electric cooperative; or
``(iv) an Indian tribe pursuant to tribal
law.
``(5) Long-term contract generator.--The term `long-term
contract generator' means a qualifying small power production
facility, a qualifying cogeneration facility ), an independent
power production facility, or a facility for the production of
electric energy for sale to others that is owned and operated
by an electric cooperative that is--
``(A) a covered entity; and
``(B) as of the date of enactment of this title--
``(i) a facility with 1 or more sales or
tolling agreements executed before March 1,
2007, that govern the facility's electricity
sales and provide for sales at a price (whether
a fixed price or a price formula) for
electricity that does not allow for recovery of
the costs of compliance with the limitation on
greenhouse gas emissions under this title,
provided that such agreements are not between
entities that are affiliates of one another; or
``(ii) a facility consisting of 1 or more
cogeneration units that makes useful thermal
energy available to an industrial or commercial
process with 1 or more sales agreements
executed before March 1, 2007, that govern the
facility's useful thermal energy sales and
provide for sales at a price (whether a fixed
price or price formula) for useful thermal
energy that does not allow for recovery of the
costs of compliance with the limitation on
greenhouse gas emissions under this title,
provided that such agreements are not between
entities that are affiliates of one another.
``(6) Merchant coal unit.--The term `merchant coal unit'
means a coal-fueled unit that--
``(A) is or is part of a covered entity;
``(B) is not owned by a Federal, State, or regional
agency or power authority; and
``(C) generates electricity solely for sale to
others, provided that all or a portion of such sales
are made by a separate legal entity that--
``(i) has a full or partial ownership or
leasehold interest in the unit, as certified in
accordance with such requirements as the
Administrator shall prescribe; and
``(ii) is not subject to retail rate
regulation or setting of retail rates by--
``(I) a State regulatory authority;
``(II) a State or political
subdivision thereof (or an agency or
instrumentality of, or corporation
wholly owned by, either of the
foregoing);
``(III) an electric cooperative; or
``(IV) an Indian tribe pursuant to
tribal law.
``(7) Merchant coal unit sales.--The term `merchant coal
unit sales' means sales to others of electricity generated by a
merchant coal unit that are made by the owner or leaseholder
described in paragraph (6)(C).
``(8) New coal-fueled unit.--The term `new coal-fueled
unit' means a coal-fueled unit that commenced operation on or
after January 1, 2009 and before January 1, 2013.
``(9) New merchant coal unit.--The term `new merchant coal
unit' means a merchant coal unit--
``(A) that commenced operation on or after January
1, 2009 and before January 1, 2013; and
``(B) the actual, on-site construction of which
commenced prior to January 1, 2009.
``(10) Qualifying small power production facility;
qualifying cogeneration facility.--The terms `qualifying small
power production facility' and `qualifying cogeneration
facility' have the meanings given those terms in section
3(17)(C) and 3(18)(B) of the Federal Power Act (16 U.S.C.
796(17)(C) and 796(18)(B)).
``(11) Small ldc.--The term `small LDC' means, for any
given year, an electricity local distribution company that
delivered less than 4,000,000 megawatt hours of electric energy
directly to retail consumers in the preceding year.
``(12) State regulatory authority.--The term `State
regulatory authority' has the meaning given that term in
section 3(17) of the Public Utility Regulatory Policies Act of
1978 (16 U.S.C. 2602(17)).
``(13) Useful thermal energy.--The term `useful thermal
energy'has the meaning given that term in section 371(7) of the
Energy Policy and Conservation Act (42 U.S.C. 6341(7)).
``(b) Electricity Local Distribution Companies.--
``(1) Distribution of allowances.--Not later than September
30, 2011, and each calendar year thereafter through 2028, the
Administrator shall distribute to electricity local
distribution companies for the benefit of retail ratepayers the
quantity of emission allowances allocated for the following
vintage year pursuant to section 782(a)(1). Notwithstanding the
preceding sentence, the Administrator shall withhold from
distribution under this subsection a quantity of emission
allowances equal to the lesser of 14.3 percent of the quantity
of emission allowances allocated under section 782(a)(1) for
the relevant vintage year, or 105 percent of the emission
allowances for the relevant vintage year that the Administrator
anticipates will be distributed to merchant coal units and to
long-term contract generators, respectively, under subsections
(c) and (d). If not required by subsections (c) and (d) to
distribute all of these reserved allowances, the Administrator
shall distribute any remaining emission allowances to
electricity local distribution companies in accordance with
this subsection.
``(2) Distribution based on emissions.--
``(A) In general.--For each vintage year, 50
percent of the emission allowances available for
distribution under paragraph (1), after reserving
allowances for distribution under subsections (c) and
(d), shall be distributed by the Administrator among
individual electricity local distribution companies
ratably based on the annual average carbon dioxide
emissions attributable to generation of electricity
delivered at retail by each such company during the
base period determined under subparagraph (B).
``(B) Base period.--
``(i) Vintage years 2012 and 2013.--For
vintage years 2012 and 2013, an electricity
local distribution company's base period shall
be--
``(I) calendar years 2006 through
2008; or
``(II) any 3 consecutive calendar
years between 1999 and 2008, inclusive,
that such company selects, provided
that the company timely informs the
Administrator of such selection.
``(ii) Vintage years 2014 and thereafter.--
For vintage years 2014 and thereafter, the base
period shall be--
``(I) the base period selected
under clause (i); or
``(II) calendar year 2012, in the
case of an electricity local
distribution company that owns, co-
owns, or purchases through a power
purchase agreement (whether directly or
through a cooperative arrangement) a
substantial portion of the electricity
generated by a new coal-fueled unit,
provided that such company timely
informs the Administrator of its
election to use 2012 as its base
period.
``(C) Determination of emissions.--
``(i) Determination for 1999-2008.--As part
of the regulations promulgated pursuant to
subsection (g), the Administrator, after
consultation with the Energy Information
Administration, shall determine the average
amount of carbon dioxide emissions attributable
to generation of electricity delivered at
retail by each electricity local distribution
company for each of the years 1999 through
2008, taking into account entities' electricity
generation, electricity purchases, and
electricity sales. In the case of any
electricity local distribution company that
owns, co-owns, or purchases through a power
purchase agreement (whether directly or through
a cooperative arrangement) a substantial
portion of the electricity generated by, a
coal-fueled unit that commenced operation after
January 1, 2006, and before December 31, 2008,
the Administrator shall adjust the emissions
attributable to such company's retail
deliveries in calendar years 2006 through 2008
to reflect the emissions that would have
occurred if the relevant unit were in operation
during the entirety of such 3-year period.
``(ii) Adjustments for new coal-fueled
units.--
``(I) Vintage years 2012 and
2013.--For purposes of emission
allowance distributions for vintage
years 2012 and 2013, in the case of any
electricity local distribution company
that owns, co-owns, or purchases
through a power purchase agreement
(whether directly or through a
cooperative arrangement) a substantial
portion of the electricity generated
by, a new coal-fueled unit, the
Administrator shall adjust the
emissions attributable to such
company's retail deliveries in the
applicable base period to reflect the
emissions that would have occurred if
the new coal-fueled unit were in
operation during such period.
``(II) Vintage year 2014 and
thereafter.--Not later than necessary
for use in making emission allowance
distributions under this subsection for
vintage year 2014, the Administrator
shall, for any electricity local
distribution company that owns, co-
owns, or purchases through a power
purchase agreement (whether directly or
through a cooperative arrangement) a
substantial portion of the electricity
generated by a new coal-fueled unit and
has selected calendar year 2012 as its
base period pursuant to subparagraph
(B)(ii)(II), determine the amount of
carbon dioxide emissions attributable
to generation of electricity delivered
at retail by such company in calendar
year 2012. If the relevant new coal-
fueled unit was not yet operational by
January 1, 2012, the Administrator
shall adjust such determination to
reflect the emissions that would have
occurred if such unit were in operation
for all of calendar year 2012.
``(iii) Requirements.--Determinations under
this paragraph shall be as precise as
practicable, taking into account the nature of
data currently available and the nature of
markets and regulation in effect in various
regions of the country. The following
requirements shall apply to such
determinations:
``(I) The Administrator shall
determine the amount of fossil fuel-
based electricity delivered at retail
by each electricity local distribution
company, and shall use appropriate
emission factors to calculate carbon
dioxide emissions associated with the
generation of such electricity.
``(II) Where it is not practical to
determine the precise fuel mix for the
electricity delivered at retail by an
individual electricity local
distribution company, the Administrator
may use the best available data,
including average data on a regional
basis with reference to Regional
Transmission Organizations or regional
entities (as that term is defined in
section 215(a)(7) of the Federal Power
Act (16 U.S.C. 824o(a)(7)), to estimate
fuel mix and emissions. Different
methodologies may be applied in
different regions if appropriate to
obtain the most accurate estimate.
``(3) Distribution based on deliveries.--
``(A) Initial formula.--Except as provided in
subparagraph (B), for each vintage year, the
Administrator shall distribute 50 percent of the
emission allowances available for distribution under
paragraph (1), after reserving allowances for
distribution under subsections (c) and (d), among
individual electricity local distribution companies
ratably based on each electricity local distribution
company's annual average retail electricity deliveries
for calendar years 2006 through 2008, unless the owner
or operator of the company selects 3 other consecutive
years between 1999 and 2008, inclusive, and timely
notifies the Administrator of its selection.
``(B) Updating.--Prior to distributing 2015 vintage
year emission allowances under this paragraph and at 3-
year intervals thereafter, the Administrator shall
update the distribution formula under this paragraph to
reflect changes in each electricity local distribution
company's service territory since the most recent
formula was established. For each successive 3-year
period, the Administrator shall distribute allowances
ratably among individual electricity local distribution
companies based on the product of--
``(i) each electricity local distribution
company's average annual deliveries per
customer during calendar years 2006 through
2008, or during the 3 alternative consecutive
years selected by such company under
subparagraph (A); and
``(ii) the number of customers of such
electricity local distribution company in the
most recent year in which the formula is
updated under this subparagraph.
``(4) Prohibition against excess distributions.--The
regulations promulgated under subsection (g) shall ensure that,
notwithstanding paragraphs (2) and (3), no electricity local
distribution company shall receive a greater quantity of
allowances under this subsection than is necessary to offset
any increased electricity costs to such company's retail
ratepayers, including increased costs attributable to purchased
power costs, due to enactment of this title. Any emission
allowances withheld from distribution to an electricity local
distribution company pursuant to this paragraph shall be
distributed among all remaining electricity local distribution
companies ratably based on emissions pursuant to paragraph (2).
``(5) Use of allowances.--
``(A) Ratepayer benefit.--Emission allowances
distributed to an electricity local distribution
company under this subsection shall be used exclusively
for the benefit of retail ratepayers of such
electricity local distribution company and may not be
used to support electricity sales or deliveries to
entities or persons other than such ratepayers.
``(B) Ratepayer classes.--In using emission
allowances distributed under this subsection for the
benefit of ratepayers, an electricity local
distribution company shall ensure that ratepayer
benefits are distributed--
``(i) among ratepayer classes ratably based
on electricity deliveries to each class; and
``(ii) equitably among individual
ratepayers within each ratepayer class,
including entities that receive emission
allowances pursuant to part F.
``(C) Limitation.--In general, an electricity local
distribution company shall not use the value of
emission allowances distributed under this subsection
to provide to any ratepayer a rebate that is based
solely on the quantity of electricity delivered to such
ratepayer. To the extent an electricity local
distribution company uses the value of emission
allowances distributed under this subsection to provide
rebates, it shall, to the maximum extent practicable,
provide such rebates with regard to the fixed portion
of ratepayers' bills or as a fixed credit or rebate on
electricity bills.
``(D) Industrial ratepayers.--Notwithstanding
subparagraph (C), if compliance with the requirements
of this title results (or would otherwise result) in an
increase in electricity costs for industrial retail
ratepayers of any given electricity local distribution
company (including entities that receive emission
allowances pursuant to part F), such electricity local
distribution company--
``(i) shall pass through to industrial
retail ratepayers their ratable share (based on
deliveries to each ratepayer class) of the
value of the emission allowances distributed to
such company under this subsection, to reduce
electricity cost impacts on such ratepayers;
and
``(ii) may do so based on the quantity of
electricity delivered to individual industrial
retail ratepayers.
``(E) Guidelines.--As part of the regulations
promulgated under subsection (g), the Administrator
shall, after consultation with State regulatory
authorities, prescribe guidelines for the
implementation of the requirements of this paragraph.
Such guidelines shall include requirements to ensure
that industrial retail ratepayers (including entities
that receive emission allowances under part F) receive
their ratable share of the value of the allowances
distributed to each electricity local distribution
company pursuant to this subsection.
``(6) Regulatory proceedings.--
``(A) Requirement.--No electricity local
distribution company shall be eligible to receive
emission allowances under this subsection or subsection
(e) unless the State regulatory authority with
authority over such company's retail rates, or the
entity with authority to regulate or set retail
electricity rates of an electricity local distribution
company not regulated by a State regulatory authority,
has--
``(i) after public notice and an
opportunity for comment, promulgated a
regulation or completed a rate proceeding (or
the equivalent, in the case of a ratemaking
entity other than a State regulatory authority)
that provides for the full implementation of
the requirements of paragraph (5) of this
subsection and the requirements of subsection
(e); and
``(ii) made available to the Administrator
and the public a report describing, in adequate
detail, the manner in which the requirements of
paragraph (5) and the requirements of
subsection (e) will be implemented.
``(B) Updating.--The Administrator shall require,
as a condition of continued receipt of emission
allowances under this subsection by an electricity
local distribution company, that a new regulation be
promulgated or rate proceeding be completed , after
public notice and an opportunity for comment, and a new
report be made available to the Administrator and the
public, pursuant to subparagraph (A), not less
frequently than every 5 years.
``(7) Plans and reporting.--
``(A) Regulations.--As part of the regulations
promulgated under subsection (g), the Administrator
shall prescribe requirements governing plans and
reports to be submitted in accordance with this
paragraph.
``(B) Plans.--Not later than April 30 of 2011 and
every 5 years thereafter through 2026, each electricity
local distribution company shall submit to the
Administrator a plan, approved by the State regulatory
authority or other entity charged with regulating tor
setting the retail rates of such company, describing
such company's plans for the disposition of the value
of emission allowances to be received pursuant to this
subsection and subsection (e), in accordance with the
requirements of this subsection and subsection (e).
Such plan shall include a description of the manner in
which the company will provide to industrial retail
ratepayers (including entities that receive emission
allowances under part F) their ratable share of the
value of such allowances.
``(C) Reports.--Not later than June 30, 2013, and
each calendar year thereafter through 2031, each
electricity local distribution company shall submit a
report to the Administrator, and to the relevant State
regulatory authority or other entity charged with
regulating or setting the retail electricity rates of
such company, describing the disposition of the value
of any emission allowances received by such company in
the prior calendar year pursuant to this subsection and
subsection (e), including--
``(i) a description of sales, transfer,
exchange, or use by the company for compliance
with obligations under this title, of any such
emission allowances;
``(ii) the monetary value received by the
company, whether in money or in some other
form, from the sale, transfer, or exchange of
any such emission allowances;
``(iii) the manner in which the company's
disposition of any such emission allowances
complies with the requirements of this
subsection and of subsection (e), including
each of the requirements of paragraph (5) of
this subsection, including the requirement that
industrial retail ratepayers (including
entities that receive emission allowances under
part F) receive their ratable share of the
value of such allowances; and
``(iv) such other information as the
Administrator may require pursuant to
subparagraph (A).
``(D) Publication.--The Administrator shall make
available to the public all plans and reports submitted
under this subsection, including by publishing such
plans and reports on the Internet.
``(8) Audits.--Each year, the Administrator shall audit a
representative sample of electricity local distribution
companies to ensure that emission allowances distributed under
this subsection have been used exclusively for the benefit of
retail ratepayers and that such companies are complying with
the requirements of this subsection and of subsection (e),
including the requirement that industrial retail ratepayers
(including entities that receive emission allowances under part
F) receive their ratable share of the value of such allowances.
In selecting companies for audit, the Administrator shall take
into account any credible evidence of noncompliance with such
requirements. The Administrator shall make available to the
public a report describing the results of each such audit,
including by publishing such report on the Internet.
``(9) Enforcement.--A violation of any requirement of this
subsection or of subsection (e) shall be a violation of this
Act. Each emission allowance the value of which is used in
violation of the requirements of this subsection or of
subsection (e) shall be a separate violation.
``(c) Merchant Coal Units.--
``(1) Qualifying emissions.--The qualifying emissions for a
merchant coal unit for a given calendar year shall be the
product of the number of megawatt hours of merchant coal unit
sales generated by such unit in such calendar year and the
average carbon dioxide emissions per megawatt hour generated by
such unit during the base period under paragraph (2), provided
that the number of megawatt hours in a given calendar year for
purposes of such calculation shall be reduced in proportion to
the portion of such unit's carbon dioxide emissions that are
either--
``(A) captured and sequestered in such calendar
year; or
``(B) attributable to the combustion or
gasification of biomass, to the extent that the owner
or operator of the unit is not required to hold
emission allowances for such emissions.
``(2) Base period.--For purposes of this subsection, the
base period for a merchant coal unit shall be--
``(A) calendar years 2006 through 2008; or
``(B) in the case of a new merchant coal unit--
``(i) the first full calendar year of
operation of such unit, if such unit commences
operation before January 1, 2012;
``(ii) calendar year 2012, if such unit
commences operation on or after January 1,
2012, and before October 1, 2012; or
``(iii) calendar year 2013, if such unit
commences operation on or after October 1,
2012, and before January 1, 2013.
``(3) Phase-down schedule.--The Administrator shall
identify an annual phase-down factor, applicable to
distributions to merchant coal units for each of vintage years
2012 through 2029, that corresponds to the overall decline in
the amount of emission allowances allocated to the electricity
sector in such years pursuant to section 782(a)(1). Such factor
shall--
``(A) for vintage year 2012, be equal to 1.0;
``(B) for each of vintage years 2013 through 2029,
correspond to the quotient of--
``(i) the quantity of emission allowances
allocated under section 782(a)(1) for such
vintage year; divided by
``(ii) the quantity of emission allowances
allocated under section 782(a)(1) for vintage
year 2012.
``(4) Distribution of emission allowances.--Not later than
March 1 of 2013 and each calendar year through 2030, the
Administrator shall distribute emission allowances of the
preceding vintage year to the owner or operator of each
merchant coal unit described in subsection (a)(6)(C) in an
amount equal to the product of--
``(A) 0.5;
``(B) the qualifying emissions for such merchant
coal unit for the preceding year, as determined under
paragraph (1); and
``(C) the phase-down factor for the preceding
calendar year, as identified under paragraph (3).
``(5) Adjustment.--
``(A) Study.--Not later than July 1, 2014, the
Administrator, in consultation with the Federal Energy
Regulatory Commission, shall complete a study to
determine whether the allocation formula under
paragraph (3) is resulting in, or is likely to result
in, windfall profits to merchant coal generators or
substantially disparate treatment of merchant coal
generators operating in different markets or regions.
``(B) Regulation.--If the Administrator, in
consultation with the Federal Energy Regulatory
Commission, makes an affirmative finding of windfall
profits or disparate treatment under subparagraph (A),
the Administrator shall, not later than 18 months after
the completion of the study described in subparagraph
(A), promulgate regulations providing for the
adjustment of the allocation formula under paragraph
(3) to mitigate, to the extent practicable, such
windfall profits, if any, and such disparate treatment,
if any.
``(6) Limitation on allowances.--Notwithstanding paragraph
(4) or (5), for each vintage year the Administrator shall
distribute under this subsection no more than 10 percent of the
total quantity of emission allowances available for such
vintage year for distribution to the electricity sector under
section 782(a)(1). If the quantity of emission allowances that
would otherwise be distributed pursuant to paragraph (4) or (5)
for any vintage year would exceed such limit, the Administrator
shall distribute 10 percent of the total emission allowances
available for distribution under section 782(a)(1) for such
vintage year ratably among merchant coal generators based on
the applicable formula under paragraph (4) or (5).
``(7) Eligibility.--The owner or operator of a merchant
coal unit shall not be eligible to receive emission allowances
under this subsection for any vintage year for which such owner
or operator has elected to receive emission allowances for the
same unit under subsection (d).
``(d) Long-term Contract Generators.--
``(1) Distribution.--Not later than March 1, 2013, and each
calendar year through 2030, the Administrator shall distribute
to the owner or operator of each long-term contract generator a
quantity of emission allowances of the preceding vintage year
that is equal to the sum of--
``(A) the number of tons of carbon dioxide emitted
as a result of a qualifying electricity sales agreement
referred to in subsection (a)(5)(B)(i); and
``(B) the incremental number of tons of carbon
dioxide emitted solely as a result of a qualifying
thermal sales agreement referred to in subsection
(a)(5)(B)(ii), provided that in no event shall the
Administrator distribute more than 1 emission allowance
for the same ton of emissions.
``(2) Limitation on allowances.--Notwithstanding paragraph
(1), for each vintage year the Administrator shall distribute
under this subsection no more than 4.3 percent of the total
quantity of emission allowances available for such vintage year
for distribution to the electricity sector under section
782(a)(1). If the quantity of emission allowances that would
otherwise be distributed pursuant to paragraph (1) for any
vintage year would exceed such limit, the Administrator shall
distribute 4.3 percent of the total emission allowances
available for distribution under section 782(a)(1) for such
vintage year ratably among long-term contract generators based
on paragraph (1).
``(3) Eligibility.--
``(A) Facility eligibility.--The owner or operator
of a facility shall cease to be eligible to receive
emission allowances under this subsection upon the
earliest date on which the facility no longer meets
each and every element of the definition of a long-term
contract generator under subsection (a)(5).
``(B) Contract eligibility.--The owner or operator
of a facility shall cease to be eligible to receive
emission allowances under this subsection based on an
electricity or thermal sales agreement referred to in
subsection (a)(5)(B) upon the earliest date that such
agreement--
``(i) expires;
``(ii) is terminated; or
``(iii) is amended in any way that changes
the location of the facility, the price
(whether a fixed price or price formula) for
electricity or thermal energy sold under such
agreement, the quantity of electricity or
thermal energy sold under the agreement, or the
expiration or termination date of the
agreement.
``(4) Demonstration of eligibility.--To be eligible to
receive allowance distributions under this subsection, the
owner or operator of a long-term contract generator shall
submit each of the following in writing to the Administrator
within 180 days after the date of enactment of this title, and
not later than September 30 of each vintage year for which such
generator wishes to receive emission allowances:
``(A) A certificate of representation described in
section 700(15).
``(B) An identification of each owner and each
operator of the facility.
``(C) An identification of the units at the
facility and the location of the facility.
``(D) A written certification by the designated
representative that the facility meets all the
requirements of the definition of a long-term contract
generator.
``(E) The expiration date of each qualifying
electricity or thermal sales agreement referred to in
subsection (a)(5)(B).
``(F) A copy of each qualifying electricity or
thermal sales agreement referred to in subsection
(a)(5)(B).
``(5) Notification.--Not later than 30 days after, in
accordance with paragraph (3), a facility or an agreement
ceases to meet the eligibility requirements for distribution of
emission allowances pursuant to this subsection, the designated
representative of such facility shall notify the Administrator
in writing when, and on what basis, such facility or agreement
ceased to meet such requirements.
``(e) Small LDCs.--
``(1) Distribution.--Not later than September 30 of each
calendar year from 2011 through 2028, the Administrator shall,
in accordance with this subsection, distribute emission
allowances allocated pursuant to section 782(a)(2) for the
following vintage year. Such allowances shall be distributed
ratably among small LDCs based on historic emissions in
accordance with the same measure of such emissions applied to
each such small LDC for the relevant vintage year under
subsection (b)(2) of this section.
``(2) Uses.--A small LDC receiving allowances under this
section shall use such allowances exclusively for the following
purposes:
``(A) Cost-effective programs to achieve
electricity savings, provided that such savings shall
not be transferred or used for compliance with section
610 of the Public Utility Regulatory Policies Act of
1978.
``(B) Deployment of technologies to generate
electricity from renewable energy resources, provided
that any Federal renewable electricity credits issued
based on generation supported under this section shall
be submitted to the Federal Energy Regulatory
Commission for voluntary retirement and shall not be
used for compliance with section 610 of the Public
Utility Regulatory Policies Act of 1978.
``(C) Assistance programs to reduce electricity
costs for low-income residential ratepayers of such
small LDC, provided that such assistance is made
available equitably to all residential ratepayers below
a certain income level, which shall not be higher than
200 percent of the poverty line (as that term is
defined in section 673(2) of the Community Services
Block Grant Act (42 U.S.C. 9902(2)).
``(3) Requirements.--As part of the regulations promulgated
under subsection (g), the Administrator shall prescribe--
``(A) after consultation with the Federal Energy
Regulatory Commission, requirements to ensure that
programs and projects under paragraph (2)(A) and (B)
are consistent with the standards established by, and
effectively supplement electricity savings and
generation of electricity from renewable energy
resources achieved by, the Combined Efficiency and
Renewable Electricity Standard established under
section 610 of the Public Utility Regulatory Policies
Act of 1978;
``(B) eligibility criteria and guidelines for
consumer assistance programs for low-income residential
ratepayers under paragraph (2)(C); and
``(C) such other requirements as the Administrator
determines appropriate to ensure compliance with the
requirements of this subsection.
``(4) Reporting.--Reports submitted under subsection (b)(7)
shall include, in accordance with such requirements as the
Administrator may prescribe--
``(A) a description of any facilities deployed
under paragraph (2)(A), the quantity of resulting
electricity generation from renewable energy resources;
``(B) an assessment demonstrating the cost-
effectiveness of, and electricity savings achieved by,
programs supported under paragraph (2)(B); and
``(C) a description of assistance provided to low-
income retail ratepayers under paragraph (2)(C).
``(f) Certain Cogeneration Facilities.--
``(1) Eligible cogeneration facilities.--For purposes of
this subsection, an `eligible cogeneration facility' is a
facility that--
``(A) is a qualifying co-generation facility (as
that term is defined in section 3(18)(B) of the Federal
Power Act (16 U.S.C. 796(18)(B));
``(B) derives 80 percent or more of its heat input
from coal, petroleum coke, or any combination of these
2 fuels;
``(C) has a nameplate capacity of 100 megawatts or
greater;
``(D) was in operation as of January 1, 2009, and
remains in operation as of the date of any distribution
of emission allowances under this subsection;
``(E) in calendar years 2006 through 2008 sold, and
as of the date of any distribution of emission
allowances under this section sells, steam or
electricity directly and solely to multiple,
separately-owned industrial or commercial facilities
co-located at the same site with the cogeneration
facility; and
``(F) is not eligible to receive allowances under
any other subsection of this section or under part F of
this title.
``(2) Distribution.--The Administrator shall distribute the
emission allowances allocated pursuant to section 782(a)(3) to
owners or operators of eligible cogeneration facilities ratably
based on the carbon dioxide emissions of each such facility in
calendar years 2006 through 2008. The Administrator--
``(A) shall not, in any year, distribute emission
allowances under this subsection to the owner or
operator of any eligible cogeneration facility in
excess of the amount necessary to offset such
facility's cost of compliance with the requirements of
this title in that year; and
``(B) may distribute such allowances over a period
of years if annual distributions under this subsection
would otherwise exceed the limitation in subparagraph
(A), provided that in no event shall distributions be
made under this subsection after calendar year 2025.
``(3) Requirements.--The Administrator shall, by
regulation, establish requirements to ensure that the value of
any emission allowances distributed pursuant to this subsection
are passed through, on an equitable basis, to the facilities to
which the relevant cogeneration facility provides electricity
or steam deliveries, including any facility owned or operated
by the owner or operator of the cogeneration facility.
``(g) Regulations.--Not later than 2 years after the date of
enactment of this title, the Administrator, in consultation with the
Federal Energy Regulatory Commission, shall promulgate regulations to
implement the requirements of this section.
``SEC. 784. NATURAL GAS CONSUMERS.
``(a) Definitions.--For purposes of this section:
``(1) Cost-effective.--The term `cost-effective', with
respect to an energy efficiency program, means that the program
meets the Total Resource Cost Test, which requires that the net
present value of economic benefits over the life of the
program, including avoided supply and delivery costs and
deferred or avoided investments, is greater than the net
present value of the economic costs over the life of the
program, including program costs and incremental costs borne by
the energy consumer.
``(2) Natural gas local distribution company.--The term
`natural gas local distribution company' means a natural gas
local distribution company that is a covered entity.
``(3) Non-covered entity.--The term `non-covered entity'
means, when used in reference to a date or period prior to the
enactment of this title, an entity that would not have been a
covered entity if this title had been in effect during such
date or period.
``(4) State regulatory authority.--The term `State
regulatory authority' has the meaning given the term `State
commission' in section 2(8) of the Natural Gas Act (15 U.S.C.
717a(8)).
``(b) Distribution.--Not later than June 30 of 2015 and each
calendar year thereafter through 2028, the Administrator shall
distribute to natural gas local distribution companies for the benefit
of retail ratepayers the quantity of emission allowances allocated for
the following vintage year pursuant to section 782(b). Such allowances
shall be distributed among local natural gas distribution companies
based on the following formula:
``(1) Initial formula.--Except as provided in paragraph
(2), for each vintage year, the Administrator shall distribute
emission allowances among natural gas local distribution
companies ratably based on each such company's annual average
retail natural gas deliveries for 2006 through 2008 to
customers that were non-covered entities, unless the owner or
operator of the company selects 3 other consecutive years
between 1999 and 2008, inclusive, and timely notifies the
Administrator of its selection.
``(2) Updating.--Prior to distributing 2019 vintage year
emission allowances and at 3-year intervals thereafter, the
Administrator shall update the distribution formula under this
subsection to reflect changes in each natural gas local
distribution company's service territory since the most recent
formula was established. For each successive 3-year period, the
Administrator shall distribute allowances ratably among natural
gas local distribution companies based on the product of--
``(A) each natural gas local distribution company's
average annual natural gas deliveries per customer to
customers that were non-covered entities during
calendar years 2006 through 2008, or during the 3
alternative consecutive years selected by such company
under paragraph (1); and
``(B) the number of customers of such natural gas
local distribution company that are not covered
entities in the most recent year in which the formula
is updated under this paragraph.
``(c) Use of Allowances.--
``(1) Ratepayer benefit.--Emission allowances distributed
to a natural gas local distribution company under this section
shall be used exclusively for the benefit of retail ratepayers
of such natural gas local distribution company other than
covered entities and may not be used to support natural gas
sales or deliveries to entities or persons other than such
ratepayers.
``(2) Ratepayer classes.--In using emission allowances
distributed under this section for the benefit of ratepayers, a
natural gas local distribution company shall ensure that
ratepayer benefits are distributed--
``(A) among ratepayer classes ratably based on
natural gas deliveries to each class, excluding
deliveries to covered entities; and
``(B) equitably among individual ratepayers other
than covered entities within each ratepayer class.
``(3) Limitation.--In general, a natural gas local
distribution company shall not use the value of emission
allowances distributed under this section to provide to any
ratepayer a rebate that is based solely on the quantity of
natural gas delivered to such ratepayer. To the extent a
natural gas local distribution company uses the value of
emission allowances distributed under this section to provide
rebates, it shall, to the maximum extent practicable, provide
such rebates with regard to the fixed portion of ratepayers'
bills or as a fixed creditor rebate on natural gas bills.
``(4) Industrial ratepayers.--Notwithstanding paragraph
(3), if compliance with the requirements of this title results
(or would otherwise result) in an increase in natural gas costs
for industrial retail ratepayers of any given natural gas local
distribution company that are not covered entities (including
entities that receive emission allowances pursuant to part F),
such natural gas local distribution company--
``(A) shall pass through to industrial retail
ratepayers that are not covered entities their ratable
share (based on deliveries to each ratepayer class) of
the value of the emission allowances distributed to
such company under this subsection, to reduce natural
gas cost impacts on such ratepayers; and
``(B) may do so based on the quantity of natural
gas delivered to individual industrial retail
ratepayers.
``(5) Energy efficiency programs.--The value of no less
than one third of the emission allowances distributed to
natural gas local distribution companies pursuant to this
section in any calendar year shall be used for cost-effective
energy efficiency programs for natural gas consumers. Such
programs must be authorized and overseen by the State
regulatory authority, or by the entity with authority to
regulate or set retail natural gas rates in the case of a
natural gas local distribution company that is not regulated by
a State regulatory authority.
``(6) Certain intracompany deliveries.--If a natural gas
local distribution company makes an intracompany delivery of
natural gas to a customer that is not a covered entity, for
which such company is required to hold emission allowances
under section 722, such customer shall, for purposes of this
section, be considered a retail ratepayer and a member of a
ratepayer class to be determined by the relevant State
regulatory authority, or other entity with authority to
regulate or set natural gas rates in the case of a company not
regulated by a State regulatory authority.
``(7) Guidelines.--As part of the regulations promulgated
under subsection (h), the Administrator shall, after
consultation with State regulatory authorities, prescribe
guidelines for the implementation of the requirements of this
subsection. Such guidelines shall include requirements to
ensure that industrial retail ratepayers that are not covered
entities (including entities that receive emission allowances
under part F) receive their ratable share of the value of the
allowances distributed to each natural gas local distribution
company pursuant to this section.
``(d) Regulatory Proceedings.--
``(1) Requirement.--No natural gas local distribution
company shall be eligible to receive emission allowances under
this section unless the State regulatory authority with
authority over the retail rates of such company, or the entity
with authority to regulate or set retail rates of a natural gas
local distribution company not regulated by a State regulatory
authority, has--
``(A) after public notice and an opportunity for
comment, promulgated a regulation or completed a public
rate proceeding (or the equivalent, in the case of a
ratemaking entity other than a State regulatory
authority) that provides for the full implementation of
the requirements of subsection (c); and
``(B) made available to the Administrator and the
public a report describing, in adequate detail, the
manner in which the requirements of subsection (c) will
be implemented.
``(2) Updating.--The Administrator shall require, as a
condition of continued receipt of emission allowances under
this section, that a new regulation be promulgated or rate
proceeding be completed, after public notice and an opportunity
for comment, and a new report be made available to the
Administrator and the public, pursuant to paragraph (1), not
less frequently than every 5 years.
``(e) Plans and Reporting.--
``(1) Regulations.--As part of the regulations promulgated
under subsection (h), the Administrator shall prescribe
requirements governing plans and reports to be submitted in
accordance with this subsection.
``(2) Plans.--Not later than April 30, 2015, and every 5
years thereafter through 2025, each natural gas local
distribution company shall submit to the Administrator a plan,
approved by the State regulatory authority or other entity
charged with regulating or setting the retail rates of such
company, describing such company's plans for the disposition of
the value of emission allowances to be received pursuant to
this section, in accordance with the requirements of this
section.
``(3) Reports.--Not later than June 30, 2017, and each
calendar year thereafter through 2031, each natural gas local
distribution company shall submit a report to the
Administrator, approved by the relevant State regulatory
authority or other entity charged with regulating or setting
the retail natural gas rates of such company, describing the
disposition of the value of any emission allowances received by
such company in the prior calendar year pursuant to this
section, including--
``(A) a description of sales, transfer, exchange,
or use by the company for compliance with obligations
under this title, of any such emission allowances;
``(B) the monetary value received by the company,
whether in money or in some other form, from the sale,
transfer, or exchange of emission allowances received
by the company under this section;
``(C) the manner in which the company's disposition
of emission allowances received under this section
complies with the requirements of this section,
including each of the requirements of subsection (c);
``(D) the cost-effectiveness of, and energy savings
achieved by, energy efficiency programs supported
through such emission allowances; and
``(E) such other information as the Administrator
may require pursuant to paragraph (1).
``(4) Publication.--The Administrator shall make available
to the public all plans and reports submitted by natural gas
local distribution companies under this subsection, including
by publishing such plans and reports on the Internet.
``(f) Audits.--Each year, the Administrator shall audit a
representative sample of natural gas local distribution companies to
ensure that emission allowances distributed under this section have
been used exclusively for the benefit of retail ratepayers and that
such companies are complying with the requirements of this section. In
selecting companies for audit, the Administrator shall take into
account any credible evidence of noncompliance with such requirements.
The Administrator shall make available to the public a report
describing the results of each such audit, including by publishing such
report on the Internet.
``(g) Enforcement.--A violation of any requirement of this section
shall be a violation of this Act. Each emission allowance the value of
which is used in violation of the requirements of this section shall be
a separate violation.
``(h) Regulations.--Not later than January 1, 2014, the
Administrator, in consultation with the Federal Energy Regulatory
Commission, shall promulgate regulations to implement the requirements
of this section.
``SEC. 785. HOME HEATING OIL, PROPANE, AND KEROSENE CONSUMERS.
``(a) Definitions.--For purposes of this section:
``(1) Carbon content.--The term `carbon content' means the
amount of carbon dioxide that would be emitted as a result of
the combustion of a fuel.
``(2) Cost-effective.--The term `cost-effective' has the
meaning given that term in section 784(a)(1).
``(3) Oilheat fuel.--The term `oilheat fuel' means fuel
that--
``(A) is--
``(i) No. 1 distillate;
``(ii) No. 2 dyed distillate;
``(iii) a liquid blended with No. 1
distillate or No. 2 dyed distillate; or
``(iv) a biobased liquid; and
``(B) is used as a fuel for nonindustrial
commercial or residential space or hot water heating.
``(b) Distribution Among States.--Not later than September 30 of
each of calendar years 2011 through 2028, the Administrator shall
distribute among the States, in accordance with this section, the
quantity of emission allowances allocated for the following vintage
year pursuant to section 782(c). The Administrator shall distribute
emission allowances among the States under this section each year
ratably based on the ratio of--
``(1) the carbon content of oilheat fuel, propane, and
kerosene sold to consumers within each State in the preceding
year for residential or commercial uses; to
``(2) the carbon content of oilheat fuel, propane, and
kerosene sold to consumers within the United States in the
preceding year for residential or commercial uses.
``(c) Use of Allowances.--
``(1) In general.--States shall use emission allowances
distributed under this section exclusively for the benefit of
consumers of oilheat fuel, propane, or kerosene for residential
or commercial purposes. Such proceeds shall be used exclusively
for--
``(A) cost-effective energy efficiency programs for
consumers that use oilheat fuel, propane, or kerosene
for residential or commercial purposes; or
``(B) rebates or other direct financial assistance
programs for consumers of oilheat fuel, propane, or
kerosene used for residential or commercial purposes.
``(2) Administration and delivery mechanisms.--In
administering programs supported by this section, States
shall--
``(A) use no less than 50 percent of the value of
emission allowances received under this section for
cost-effective energy efficiency programs to reduce
consumers' overall fuel costs;
``(B) to the extent practicable, deliver consumer
support under this section through existing energy
efficiency and consumer energy assistance programs or
delivery mechanisms, including, where appropriate,
programs or mechanisms administered by parties other
than the State; and
``(C) seek to coordinate the administration and
delivery of energy efficiency and consumer energy
assistance programs supported under this section, with
one another and with existing programs for various fuel
types, so as to deliver comprehensive, fuel-blind,
coordinated programs to consumers.
``(d) Reporting.--Each State receiving emission allowances under
this section shall submit to the Administrator, within 12 months of
each receipt of such allowances, a report, in accordance with such
requirements as the Administrator may prescribe, that--
``(1) describes the State's use of emission allowances
distributed under this section, including a description of the
energy efficiency and consumer assistance programs supported
with such allowances;
``(2) demonstrates the cost-effectiveness of, and the
energy savings and greenhouse gas emissions reductions achieved
by, energy efficiency programs supported under this section;
and
``(3) includes a report prepared by an independent third
party, in accordance with such regulations as the Administrator
may promulgate, evaluating the performance of the energy
efficiency and consumer assistance programs supported under
this section.
``(e) Enforcement.--If the Administrator determines that a State is
not in compliance with this section, the Administrator may withhold a
portion of the emission allowances, the quantity of which is equal to
up to twice the quantity of the allowances that the State failed to use
in accordance with the requirements of this section, that such State
would otherwise be eligible to receive under this section in later
years. Allowances withheld pursuant to this subsection shall be
distributed among the remaining States ratably in accordance with the
formula in subsection (b).
``SEC. 787. ALLOCATIONS TO REFINERIES.
``(a) Purpose.--The purpose of this section is to provide emission
allowance rebates to petroleum refineries in the United States in a
manner that promotes energy efficiency and a reduction in greenhouse
gas emissions at such facilities.
``(b) Definitions.--In this section:
``(1) Emissions.--The term `emissions' includes direct
emissions from fuel combustion, process emissions, and indirect
emissions from the generation of electricity, steam, and
hydrogen used to produce the output of a petroleum refinery or
the petroleum refinery sector.
``(2) Petroleum refinery.--The term `petroleum refinery'
means a facility classified under code 324110 of the North
American Industrial Classification System of 2002.
``(3) Small business refiner.--The term `small business
refiner' means a refiner that meets the applicable Federal
refinery capacity and employee limitations criteria described
in section 45H(c)(1) of the Internal Revenue Code of 1986 (as
in effect on the date of enactment of this section and without
regard to section 45H(d)). Eligibility of a small business
refiner under this paragraph shall not be recalculated or
disallowed on account of (i) its merger with another small
business refiner or refiners after December 31, 2002 or (ii)
its acquisition of another small business refiner (or refinery
of such refiner) after December 31, 2002.
``(c) In General.--For each vintage year between 2014 and 2026, the
Administrator shall distribute allowances pursuant to this section to
owners and operators of petroleum refineries, including small business
refiners, in the United States.
``(d) Distribution Schedule.--The Administrator shall distribute
emission allowances pursuant to the regulations issued under subsection
(e) for each vintage year no later than October 31 of the preceding
calendar year.
``(e) Regulations.--Not later than 3 years after the date of
enactment of this title, the Administrator, in consultation with the
Administrator of the Energy Information Administration, shall
promulgate regulations that establish a formula for distributing
emission allowances consistent with the purpose of this section. In
establishing such formula, the Administrator shall consider the
relative complexity of refinery processes and appropriate mechanisms to
take energy efficiency and greenhouse gas reductions into account. If a
petroleum refinery's electricity provider received a free allocation of
emission allowances pursuant to section 782(a), the Administrator shall
take this free allocation into account when establishing such formula
to avoid rebates to a petroleum refinery for costs that the
Administrator determines were not incurred by the petroleum refinery
because the allowances were freely allocated to the petroleum
refinery's electricity provider and used for the benefit of the
petroleum refinery. This formula shall apply separately to the
distribution of allowances allocated pursuant to section 782(j)(1) and
to those allocated under section 782(j)(2).
``SEC. 788. SUPPLEMENTAL AGRICULTURE AND RENEWABLE ENERGY INCENTIVES
PROGRAMS.
``(a) In General.--Emission allowances allocated pursuant to
section 782(u) shall be distributed by the Administrator at the
direction of the Secretary of Energy and the Secretary of Agriculture
in accordance with this section. Not less than 50 percent of the
allowances shall be available for the program established pursuant to
subsection (b).
``(b) Agriculture Incentives Program.--
``(1) Establishment.--The Secretary of Agriculture shall
establish by rule a program to provide incentives in the form
of emission allowances for activities undertaken in the
agriculture sector that reduce greenhouse gas emissions or
sequester carbon. Under this program, the Secretary of
Agriculture shall provide incentives for projects and
activities that--
``(A) reduce or avoid greenhouse gas emissions, or
sequester greenhouse gases, but do not meet the
criteria for offset credits established under the
American Clean Energy and Security Act of 2009;
``(B) support actions to adapt to climate change;
or
``(C) prevent conversion of land that would
increase greenhouse gas emissions (including projects
and activities that complement or supplement
conservation programs administered by the Secretary).
``(2) Considerations.--In designing this program, the
Secretary shall ensure that it provides support for--
``(A) development and demonstration of practices to
reduce greenhouse gas emissions or sequester carbon in
agricultural operations where there are limited
recognized opportunities to achieve such emissions
reductions or sequestration; and
``(B) projects that reduce greenhouse gas emissions
or increase sequestration of greenhouse gases and also
achieve other significant environmental benefits, such
as the improvement of water or air quality.
``(3) Research.--The Secretary shall establish by rule a
program to conduct research to develop additional projects and
activities for crops to find additional techniques and methods
to reduce greenhouse gas emissions or sequester greenhouse
gases that may or may not meet the criteria for offset credits
established under the American Clean Energy and Security Act of
2009.
``(4) Use of information.--Information and data generated
by this program should, where relevant, be used to inform the
development of additional offset practices and methodologies.
``(c) Renewable Energy Incentives Program.--The Secretary of Energy
and the Administrator shall establish by rule a program to provide
allowances to State and local governments to support the deployment of
renewable energy infrastructure.
``SEC. 789. CLIMATE CHANGE CONSUMER REFUNDS.
``(a) Refund.--In each year after deposits are made to the Climate
Change Consumer Refund Account, the Secretary of the Treasury shall
provide tax refunds on a per capita basis to each household in the
United States that shall collectively equal the amount deposited into
the Climate Change Consumer Refund Account.
``(b) Limitations.--The Secretary of the Treasury shall establish
procedures to ensure that individuals who are not--
``(1) citizens or nationals of the United States; or
``(2) immigrants lawfully residing in the United States,
are excluded for the purpose of calculating and distributing refunds
under this section.
``SEC. 790. EXCHANGE FOR STATE-ISSUED ALLOWANCES.
``(a) In General.--Not later than 1 year after the date of
enactment of this title, the Administrator shall issue regulations
allowing any person in the United States to exchange greenhouse gas
emission allowances issued before December 31, 2011, by the State of
California or for the Regional Greenhouse Gas Initiative, or the
Western Climate Initiative (in this section referred to as `State
allowances') for emission allowances established by the Administrator
under section 721(a).
``(b) Regulations.--Regulations issued under subsection (a) shall--
``(1) provide that a person exchanging State allowances
under this section receive emission allowances established
under section 721(a) in the amount that is sufficient to
compensate for the cost of obtaining and holding such State
allowances;
``(2) establish a deadline by which persons must exchange
the State allowances;
``(3) provide that the Federal emission allowances
disbursed pursuant to this section shall be deducted from the
allowances to be auctioned pursuant to section 782(d); and
``(4) require that, once exchanged, the credit or other
instrument be retired for purposes of use under the program by
or for which it was originally issued.
``(c) Cost of Obtaining State Allowance.--For purposes of this
section, the cost of obtaining a State allowance shall be the average
auction price, for emission allowances issued in the year in which the
State allowance was issued, under the program under which the State
allowance was issued.
``SEC. 791. AUCTION PROCEDURES.
``(a) In General.--To the extent that auctions of emission
allowances by the Administrator are authorized by this part, such
auctions shall be carried out pursuant to this section and the
regulations established hereunder.
``(b) Initial Regulations.--Not later than 12 months after the date
of enactment of this title, the Administrator, in consultation with
other agencies, as appropriate, shall promulgate regulations governing
the auction of allowances under this section. Such regulations shall
include the following requirements:
``(1) Frequency; first auction.--Auctions shall be held
four times per year at regular intervals, with the first
auction to be held no later than March 31, 2011.
``(2) Auction schedule; current and future vintages.--The
Administrator shall, at each quarterly auction under this
section, offer for sale both a portion of the allowances with
the same vintage year as the year in which the auction is being
conducted and a portion of the allowances with vintage years
from future years. The preceding sentence shall not apply to
auctions held before 2012, during which period, by necessity,
the Administrator shall auction only allowances with a vintage
year that is later than the year in which the auction is held.
Beginning with the first auction and at each quarterly auction
held thereafter, the Administrator may offer for sale
allowances with vintage years of up to 4 years after the year
in which the auction is being conducted, except as provided in
section 782(p).
``(3) Auction format.--Auctions shall follow a single-
round, sealed-bid, uniform price format.
``(4) Participation; financial assurance.--Auctions shall
be open to any person, except that the Administrator may
establish financial assurance requirements to ensure that
auction participants can and will perform on their bids.
``(5) Disclosure of beneficial ownership.--Each bidder in
the auction shall be required to disclose the person or entity
sponsoring or benefitting from the bidder's participation in
the auction if such person or entity is, in whole or in part,
other than the bidder.
``(6) Purchase limits.--No person may, directly or in
concert with another participant, purchase more than 5 percent
of the allowances offered for sale at any quarterly auction.
``(7) Publication of information.--After the auction, the
Administrator shall, in a timely fashion, publish the
identities of winning bidders, the quantity of allowances
obtained by each winning bidder, and the auction clearing
price.
``(8) Other requirements.--The Administrator may include in
the regulations such other requirements or provisions as the
Administrator, in consultation with other agencies, as
appropriate, considers appropriate to promote effective,
efficient, transparent, and fair administration of auctions
under this section.
``(c) Revision of Regulations.--The Administrator may, in
consultation with other agencies, as appropriate, at any time, revise
the initial regulations promulgated under subsection (b) by
promulgating new regulations. Such revised regulations need not meet
the requirements identified in subsection (b) if the Administrator
determines that an alternative auction design would be more effective,
taking into account factors including costs of administration,
transparency, fairness, and risks of collusion or manipulation. In
determining whether and how to revise the initial regulations under
this subsection, the Administrator shall not consider maximization of
revenues to the Federal Government.
``(d) Reserve Auction Price.--The minimum reserve auction price
shall be $10 (in constant 2009 dollars) for auctions occurring in 2012.
The minimum reserve price for auctions occurring in years after 2012
shall be the minimum reserve auction price for the previous year
increased by 5 percent plus the rate of inflation (as measured by the
Consumer Price Index for all urban consumers).
``(e) Delegation or Contract.--Pursuant to regulations under this
section, the Administrator may by delegation or contract provide for
the conduct of auctions under the Administrator's supervision by other
departments or agencies of the Federal Government or by nongovernmental
agencies, groups, or organizations.
``(f) Small Business Refiner Reserve.--The Administrator shall, in
accordance with this subsection, issue regulations setting aside a
specified number of allowances that small business refiners may
purchase at the average auction price and may use to demonstrate
compliance pursuant to section 722. These regulations shall provide the
following:
``(1) Amount.--The Administrator shall place in the small
business refiner reserve account allowances that are to be sold
at auction pursuant to the allocations in section 782 in an
amount equal to--
``(A) 6.2 percent of the emission allowances
established under section 721(a) for each vintage year
from 2012 through 2013;
``(B) 5.4 percent of the emission allowances
established under section 721(a) for each vintage year
from 2014 through 2015; and
``(C) 4.9 percent of the emission allowances
established under section 721(a) for each vintage year
from 2016 through 2024.
``(2) Allowed purchases.--From January 1 of the calendar
year that matches the vintage year for which allowances have
been placed in the reserve, through January 14 of the following
year, small business refiners (as defined in section 787(b))
may purchase allowances from this reserve at the price
determined pursuant to paragraph (3).
``(3) Price.--The price for allowances purchased from this
reserve shall be the average auction price for allowances of
the same vintage year purchased at auctions conducted pursuant
to this section during the 12 months preceding the purchase of
the allowances.
``(4) Use of allowances.--Allowances purchased from this
reserve shall only be used by the purchaser to demonstrate
compliance pursuant to section 722 for attributable greenhouse
gas emissions in the calendar year that matches the vintage
year of the purchased allowance. Allowances purchased from this
reserve may not be banked, traded or borrowed.
``(5) Limitations on purchase amount.--The Administrator,
by regulation adopted after public notice and an opportunity
for comment, shall establish procedures to distribute the
ability to purchase allowances from the reserve fairly among
all small business refiners interested in purchasing allowances
from this reserve so as to address the potential that requests
to purchase allowances exceed the number of allowances
available in the reserve. This regulation may place limits on
the number of allowances a small business refiner may purchase
from the reserve.
``(6) Unsold allowances.--Vintage year allowances not sold
from the reserve on or before January 15 of the calendar year
following the vintage year shall be sold at an auction
conducted pursuant to this section no later than March 31 of
the calendar year following the vintage year. If significantly
more allowances are being placed in the reserve than are being
purchased from the reserve several years in a row, the
Administrator may adjust either the percent of allowances
placed in the reserve or the date by which allowances may be
purchased from the reserve.
``SEC. 792. AUCTIONING ALLOWANCES FOR OTHER ENTITIES.
``(a) Consignment.--Any entity holding emission allowances or
compensatory allowances may request that the Administrator auction,
pursuant to section 791, the allowances on consignment.
``(b) Pricing.--When the Administrator acts under this section as
the agent of an entity in possession of emission allowances or
compensatory allowances, the Administrator is not obligated to obtain
the highest price possible for the allowances, and instead shall
auction consignment allowances in the same manner and pursuant to the
same rules as auctions of other allowances under section 791. The
Administrator may permit the entity offering the allowance for sale to
condition the sale of its allowances pursuant to this section on a
minimum reserve price that is different than the reserve auction price
set pursuant to section 791(d).
``(c) Proceeds.--For emission allowances and compensatory
allowances auctioned pursuant to this section, notwithstanding section
3302 of title 31, United States Code, or any other provision of law,
within 90 days of receipt, the United States shall transfer the
proceeds from the auction to the entity which held the allowances
auctioned. No funds transferred from a purchaser to a seller of
emission allowances or compensatory allowances under this subsection
shall be held by any officer or employee of the United States or
treated for any purpose as public monies.
``(d) Unsold Allowances.--Allowances offered for sale under this
section that are not sold shall be returned to the entity in possession
of the allowance, notwithstanding section 726(b)(2)(A).
``(e) Regulations.--The Administrator shall issue regulations
within 24 months after the date of enactment of this title to implement
this section.
``SEC. 793. ESTABLISHMENT OF FUNDS.
``There is hereby established in the Treasury of the United States
the following separate accounts:
``(1) The Strategic Reserve Fund.
``(2) The Climate Change Consumer Refund Account.
``(3) The Climate Change Worker Adjustment Assistance Fund.
``SEC. 794. OVERSIGHT OF ALLOCATIONS.
``(a) In General.--Not later than January 1, 2014, and every 2
years thereafter, the Comptroller General of the United States shall
carry out and report to Congress on the results of a review of programs
administered by the Federal Government that distribute emission
allowances or funds from any Federal auction of allowances.
``(b) Contents.--Each such report shall include a comprehensive
evaluation of the administration and effectiveness of each program,
including--
``(1) the efficiency, transparency, and soundness of the
administration of each program;
``(2) the performance of activities receiving assistance
under each program;
``(3) the cost-effectiveness of each program in achieving
the stated purposes of the program; and
``(4) recommendations, if any, for legislative, regulatory,
or administrative changes to each program to improve its
effectiveness.
``(c) Focus.--In evaluating program performance, each review under
this section review shall address the effectiveness of such programs
in--
``(1) creating and preserving jobs;
``(2) ensuring a manageable transition for working families
and workers;
``(3) reducing the emissions, or enhancing sequestration,
of greenhouse gases;
``(4) developing clean technologies; and
``(5) building resilience to the impacts of climate change.
``SEC. 795. EXCHANGE FOR EARLY ACTION OFFSET CREDITS.
``(a) In General.--Emission allowances allocated pursuant to
section 782(t) shall be distributed by the Administrator in accordance
with this section. Not later than 1 year after the date of enactment of
this title, the Administrator shall issue regulations allowing--
``(1) any person in the United States to exchange
instruments in the nature of offset credits issued before
January 1, 2009, by a State or voluntary offset program with
respect to which the Administrator has made an affirmative
determination under section 740(a)(2), for emissions allowances
established by the Administrator under section 721(a); and
``(2) the Administrator to provide compensation in the form
of emission allowances to entities that do not meet the
criteria of paragraph (1) and meet the criteria of this
paragraph for documented early reductions or avoidance of
greenhouse gas emissions or greenhouse gases sequestered before
January 1, 2009, from projects begun before January 1, 2009,
where--
``(A) the entity publicly stated greenhouse gas
reduction goals and publicly reported against those
goals;
``(B) the entity demonstrated entity-wide net
greenhouse gas reductions; and
``(C) the entity demonstrates the actual projects
undertaken to make reductions and documents the
reductions (e.g., through documentation of engineering
projects).
``(b) Regulations.--Regulations issued under subsection (a) shall--
``(1) provide that a person exchanging credits under
subsection (a)(1) receive emission allowances established under
section 721(a) in an amount for which the monetary value is
equivalent to the average monetary value of the credits during
the period from January 1, 2006, to January 1, 2009, as
adjusted for inflation to reflect current dollar values at the
time of the exchange;
``(2) provide that a person receiving compensation for
documented early action under subsection (a)(2) shall receive
emission allowances established under section 721(a) in an
amount that is approximately equivalent in value to the carbon
dioxide equivalent per ton value received by entities in
exchange for credits under paragraph (1) (as adjusted for
inflation to reflect current dollar values at the time of the
exchange), as determined by the Administrator;
``(3) provide that only reductions or avoidance of
greenhouse gas emissions, or sequestration of greenhouse gases,
achieved by activities in the United States between January 1,
2001, and January 1, 2009, may be compensated under this
section, and only credits issued for such activities may be
exchanged under this section;
``(4) provide that only credits that have not been retired
or otherwise used to meet a voluntary or mandatory commitment,
and have not expired, may be exchanged under subsection (a)(1);
``(5) require that, once exchanged, the credit be retired
for purposes of use under the program by or for which it was
originally issued; and
``(6) establish a deadline by which persons must exchange
the credits or request compensation for early action under this
section.
``(c) Participation.--Participation in an exchange of credits for
allowances or compensation for early action authorized by this section
shall not preclude any person from participation in an offset credit
program established under the American Clean Energy and Security Act of
2009.
``(d) Distribution.--Of the emission allowances distributed under
this section, a quantity equal to 0.75 percent of vintage year 2012
emission allowances established under section 721(a) shall be
distributed pursuant to subsection (a)(1), and a quantity equal to 0.25
percent of vintage year 2012 emission allowances established under
section 721(a) shall be distributed pursuant to subsection (a)(2).''.
Subtitle C--Additional Greenhouse Gas Standards
SEC. 331. GREENHOUSE GAS STANDARDS.
The Clean Air Act (42 U.S.C. 7401 and following), as amended by
subtitles A and B of this title, is further amended by adding the
following new title after title VII:
``TITLE VIII--ADDITIONAL GREENHOUSE GAS STANDARDS
``SEC. 801. DEFINITIONS.
``For purposes of this title, terms that are defined in title VII,
except for the term `stationary source', shall have the meaning given
those terms in title VII.
``PART A--STATIONARY SOURCE STANDARDS
``SEC. 811. STANDARDS OF PERFORMANCE.
``(a) Uncapped Stationary Sources.--
``(1) Inventory of source categories.--(A) Within 12 months
after the date of enactment of this title, the Administrator
shall publish under section 111(b)(1)(A) an inventory of
categories of stationary sources that consist of those
categories that contain sources that individually had uncapped
greenhouse gas emissions greater than 10,000 tons of carbon
dioxide equivalent and that, in the aggregate, were responsible
for emitting at least 20 percent annually of the uncapped
greenhouse gas emissions.
``(B) The Administrator shall include in the inventory
under this paragraph each source category that is responsible
for at least 10 percent of the uncapped methane emissions in
2005. Notwithstanding any other provision, the inventory
required by this section shall not include sources of enteric
fermentation. The list under this paragraph shall include
industrial sources, the emissions from which, when added to the
capped emissions from industrial sources, constitute at least
95 percent of the greenhouse gas emissions of the industrial
sector.
``(C) For purposes of this subsection, emissions shall be
calculated using tons of carbon dioxide equivalents. In
promulgating the inventory required by this paragraph and the
schedule required under by paragraph (2)(C), the Administrator
shall use the most current emissions data available at the time
of promulgation, except as provided in subparagraph (B).
``(D) Notwithstanding any other provisions, the
Administrator may list under 111(b) any source category
identified in the inventory required by this subsection without
making a finding that the source category causes or contributes
significantly to, air pollution with may be reasonably
anticipated to endanger public health or welfare.
``(2) Standards and schedule.--(A) For each category
identified as provided in paragraph (1), the Administrator
shall promulgate standards of performance under section 111 for
the uncapped emissions of greenhouse gases from stationary
sources in that category and shall promulgate corresponding
regulations under section 111(d).
``(B) The Administrator shall promulgate standards as
required by this subsection for stationary sources in
categories identified as provided in paragraph (1) as
expeditiously as practicable, assuring that--
``(i) standards for identified source categories
that, combined, emitted 80 percent or more of the
greenhouse gas emissions of the identified source
categories shall be promulgated not later than 3 years
after the date of enactment of this title and shall
include standards for natural gas extraction; and
``(ii) for all other identified source categories--
``(I) standards for not less than an
additional 25 percent of the identified
categories shall be promulgated not later than
5 years after the date of enactment of this
title;
``(II) standards for not less than an
additional 25 percent of the identified
categories shall be promulgated not later than
7 years after the date of enactment of this
title; and
``(III) standards for all the identified
categories shall be promulgated not later than
10 years after the date of enactment of this
title.
``(C) Not later than 24 months after the date of enactment
of this title and after notice and opportunity for comment, the
Administrator shall publish a schedule establishing a date for
the promulgation of standards for each category of sources
identified pursuant to paragraph (1). The date for each
category shall be consistent with the requirements of
subparagraph (B). The determination of priorities for the
promulgation of standards pursuant to this paragraph is not a
rulemaking and shall not be subject to judicial review, except
that failure to promulgate any standard pursuant to the
schedule established by this paragraph shall be subject to
review under section 304(a)(2).
``(D) Notwithstanding section 307, no action of the
Administrator listing a source category under paragraph (1)
shall be a final agency action subject to judicial review,
except that any such action may be reviewed under section 307
when the Administrator issues performance standards for such
category.
``(b) Capped Sources.--No standard of performance shall be
established under section 111 for capped greenhouse gas emissions from
a capped source unless the Administrator determines that such standards
are appropriate because of effects that do not include climate change
effects. In promulgating a standard of performance under section 111
for the emission from capped sources of any air pollutant that is not a
greenhouse gas, the Administrator shall treat the emission of any
greenhouse gas by those entities as a nonair quality public health and
environmental impact within the meaning of section 111(a)(1).
``(c) Performance Standards.--For purposes of setting a performance
standard for source categories identified pursuant to subsection (a)--
``(1) The Administrator shall take into account the goal of
reducing total United States greenhouse gas emissions as set
forth in section 702.
``(2) The Administrator may promulgate a design, equipment,
work practice, or operational standard, or any combination
thereof, under section 111 in lieu of a standard of performance
under that section without regard to any determination of
feasibility that would otherwise be required under section
111(h).
``(3) Notwithstanding any other provision, in setting the
level of each standard required by this section, the
Administrator shall take into account projections of allowance
prices, such that the marginal cost of compliance (expressed as
dollars per ton of carbon dioxide equivalent reduced) imposed
by the standard would not, in the judgement of the
Administrator, be expected to exceed the Administrator's
projected allowance prices over the time period spanning from
the date of initial compliance to the date that the next
revisions of the standard would come into effect pursuant to
the schedule under section 111(b)(1)(B).
``(d) Definitions.--In this section, the terms `uncapped greenhouse
gas emissions' and `uncapped methane emissions' mean those greenhouse
gas or methane emissions, respectively, to which section 722 would not
have applied if the requirements of this title had been in effect for
the same year as the emissions data upon which the list is based.
``(e) Study of the Effects of Performance Standards.--
``(1) Study.--The Administrator shall conduct a study of
the impacts of performance standards required under this
section, which shall evaluate the effect of such standards on
the--
``(A) costs of achieving compliance with the
economy-wide reduction goals specified in section 702
and the reduction targets specified in section 703;
``(B) available supply of offset credits; and
``(C) ability to achieve the economy-wide reduction
goals specified in section 702 and any other benefits
of such standards.
``(2) Report.--The Administrator shall submit to the House
Energy and Commerce Committee a report that describes the
results of the study not later than 18 months after the
publication of the standards required under subsection
(a)(2)(B)(i).
``PART C--EXEMPTIONS FROM OTHER PROGRAMS
``SEC. 831. CRITERIA POLLUTANTS.
``As of the date of the enactment of the Safe Climate Act, no
greenhouse gas may be added to the list under section 108(a) on the
basis of its effect on global climate change.
``SEC. 832. INTERNATIONAL AIR POLLUTION.
``Section 115 shall not apply to an air pollutant with respect to
that pollutant's contribution to global warming.
``SEC. 833. HAZARDOUS AIR POLLUTANTS.
``No greenhouse gas may be added to the list of hazardous air
pollutants under section 112 unless such greenhouse gas meets the
listing criteria of section 112(b) independent of its effects on global
climate change.
``SEC. 834. NEW SOURCE REVIEW.
``The provisions of part C of title I shall not apply to a major
emitting facility that is initially permitted or modified after January
1, 2009, on the basis of its emissions of any greenhouse gas.
``SEC. 835. TITLE V PERMITS.
``Notwithstanding any provision of title III or V, no stationary
source shall be required to apply for, or operate pursuant to, a permit
under title V, solely because the source emits any greenhouse gases
that are regulated solely because of their effect on global climate
change.''.
SEC. 332. HFC REGULATION.
(a) In General.--Title VI of the Clean Air Act (42 U.S.C. 7671 et
seq.) (relating to stratospheric ozone protection) is amended by adding
at the end the following:
``SEC. 619. HYDROFLUOROCARBONS (HFCS).
``(a) Treatment as Class II, Group II Substances.--Except as
otherwise provided in this section, hydrofluorocarbons shall be treated
as class II substances for purposes of applying the provisions of this
title. The Administrator shall establish two groups of class II
substances. Class II, group I substances shall include all
hydrochlorofluorocarbons (HCFCs) listed pursuant to section 602(b).
Class II, group II substances shall include each of the following:
``(1) Hydrofluorocarbon-23 (HFC-23).
``(2) Hydrofluorocarbon-32 (HFC-32).
``(3) Hydrofluorocarbon-41 (HFC-41).
``(4) Hydrofluorocarbon-125 (HFC-125).
``(5) Hydrofluorocarbon-134 (HFC-134).
``(6) Hydrofluorocarbon-134a (HFC-134a).
``(7) Hydrofluorocarbon-143 (HFC-143).
``(8) Hydrofluorocarbon-143a (HFC-143a).
``(9) Hydrofluorocarbon-152 (HFC-152).
``(10) Hydrofluorocarbon-152a (HFC-152a).
``(11) Hydrofluorocarbon-227ea (HFC-227ea).
``(12) Hydrofluorocarbon-236cb (HFC-236cb).
``(13) Hydrofluorocarbon-236ea (HFC-236ea).
``(14) Hydrofluorocarbon-236fa (HFC-236fa).
``(15) Hydrofluorocarbon-245ca (HFC-245ca).
``(16) Hydrofluorocarbon-245fa (HFC-245fa).
``(17) Hydrofluorocarbon-365mfc (HFC-365mfc).
``(18) Hydrofluorocarbon-43-10mee (HFC-43-10mee).
``(19) Hydrofluoroolefin-1234yf (HFO-1234yf).
``(20) Hydrofluoroolefin-1234ze (HFO-1234ze).
Not later than 6 months after the date of enactment of this title, the
Administrator shall publish an initial list of class II, group II
substances, which shall include the substances listed in this
subsection. The Administrator may add to the list of class II, group II
substances any other substance used as a substitute for a class I or II
substance if the Administrator determines that 1 metric ton of the
substance makes the same or greater contribution to global warming over
100 years as 1 metric ton of carbon dioxide. Within 24 months after the
date of enactment of this section, the Administrator shall amend the
regulations under this title (including the regulations referred to in
sections 603, 608, 609, 610, 611, 612, and 613) to apply to class II,
group II substances.
``(b) Consumption and Production of Class II, Group II
Substances.--
``(1) In general.--
``(A) Consumption phase down.--In the case of class
II, group II substances, in lieu of applying section
605 and the regulations thereunder, the Administrator
shall promulgate regulations phasing down the
consumption of class II, group II substances in the
United States, and the importation of products
containing any class II, group II substance, in
accordance with this subsection within 18 months after
the date of enactment of this section. Effective
January 1, 2012, it shall be unlawful for any person to
produce any class II, group II substance, import any
class II, group II substance, or import any product
containing any class II, group II substance without
holding one consumption allowance or one destruction
offset credit for each carbon dioxide equivalent ton of
the class II, group II substance. Any person who
exports a class II, group II substance for which a
consumption allowance was retired may receive a refund
of that allowance from the Administrator following the
export.
``(B) Production.--If the United States becomes a
party or otherwise adheres to a multilateral agreement,
including any amendment to the Montreal Protocol on
Substances That Deplete the Ozone Layer, that restricts
the production of class II, group II substances, the
Administrator shall promulgate regulations establishing
a baseline for the production of class II, group II
substances in the United States and phasing down the
production of class II, group II substances in the
United States, in accordance with such multilateral
agreement and subject to the same exceptions and other
provisions as are applicable to the phase down of
consumption of class II, group II substances under this
section (except that the Administrator shall not
require a person who obtains production allowances from
the Administrator to make payment for such allowances
if the person is making payment for a corresponding
quantity of consumption allowances of the same vintage
year). Upon the effective date of such regulations, it
shall be unlawful for any person to produce any class
II, group II substance without holding one consumption
allowance and one production allowance, or one
destruction offset credit, for each carbon dioxide
equivalent ton of the class II, group II substance.
``(C) Integrity of cap.--To maintain the integrity
of the class II, group II cap, the Administrator may,
through rulemaking, limit the percentage of each
person's compliance obligation that may be met through
the use of destruction offset credits or banked
allowances.
``(D) Counting of violations.--Each consumption
allowance, production allowance, or destruction offset
credit not held as required by this section shall be a
separate violation of this section.
``(2) Schedule.--Pursuant to the regulations promulgated
pursuant to paragraph (1)(A), the number of class II, group II
consumption allowances established by the Administrator for
each calendar year beginning in 2012 shall be the following
percentage of the baseline, as established by the Administrator
pursuant to paragraph (3):
----------------------------------------------------------------------------------------------------------------
``Calendar Year Percent of Baseline
----------------------------------------------------------------------------------------------------------------
2012 90
----------------------------------------------------------------------------------------------------------------
2013 87.5
----------------------------------------------------------------------------------------------------------------
2014 85
----------------------------------------------------------------------------------------------------------------
2015 82.5
----------------------------------------------------------------------------------------------------------------
2016 80
----------------------------------------------------------------------------------------------------------------
2017 77.5
----------------------------------------------------------------------------------------------------------------
2018 75
----------------------------------------------------------------------------------------------------------------
2019 71
----------------------------------------------------------------------------------------------------------------
2020 67
----------------------------------------------------------------------------------------------------------------
2021 63
----------------------------------------------------------------------------------------------------------------
2022 59
----------------------------------------------------------------------------------------------------------------
2023 54
----------------------------------------------------------------------------------------------------------------
2024 50
----------------------------------------------------------------------------------------------------------------
2025 46
----------------------------------------------------------------------------------------------------------------
2026 42
----------------------------------------------------------------------------------------------------------------
2027 38
----------------------------------------------------------------------------------------------------------------
2028 34
----------------------------------------------------------------------------------------------------------------
2029 30
----------------------------------------------------------------------------------------------------------------
2030 25
----------------------------------------------------------------------------------------------------------------
2031 21
----------------------------------------------------------------------------------------------------------------
2032 17
----------------------------------------------------------------------------------------------------------------
after 2032 15
----------------------------------------------------------------------------------------------------------------
``(3) Baseline.--(A) Within 12 months after the date of
enactment of this section, the Administrator shall promulgate
regulations to establish the baseline for purposes of paragraph
(2). The baseline shall be the sum, expressed in metric tons of
carbon dioxide equivalents, of--
``(i) the annual average consumption of all class
II substances in calendar years 2004, 2005, and 2006;
plus
``(ii) the annual average quantity of all class II
substances contained in imported products in calendar
years 2004, 2005, and 2006.
``(B) Notwithstanding subparagraph (A), if the
Administrator determines that the baseline is higher than 370
million metric tons of carbon dioxide equivalents, then the
Administrator shall establish the baseline at 370 million
metric tons of carbon dioxide equivalents.
``(C) Notwithstanding subparagraph (A), if the
Administrator determines that the baseline is lower than 280
million metric tons of carbon dioxide equivalents, then the
Administrator shall establish the baseline at 280 million
metric tons of carbon dioxide equivalents.
``(4) Distribution of allowances.--
``(A) In general.--Pursuant to the regulations
promulgated under paragraph (1)(A), for each calendar
year beginning in 2012, the Administrator shall sell
consumption allowances in accordance with this
paragraph.
``(B) Establishment of pools.--The Administrator
shall establish two allowance pools. Eighty percent of
the consumption allowances available for a calendar
year shall be placed in the producer-importer pool, and
20 percent of the consumption allowances available for
a calendar year shall be placed in the secondary pool.
``(C) Producer-importer pool.--
``(i) Auction.--(I) For each calendar year,
the Administrator shall offer for sale at
auction the following percentage of the
consumption allowances in the producer-importer
pool:
----------------------------------------------------------------------------------------------------------------
``Calendar Year Percent Available for Auction
----------------------------------------------------------------------------------------------------------------
2012 10
----------------------------------------------------------------------------------------------------------------
2013 20
----------------------------------------------------------------------------------------------------------------
2014 30
----------------------------------------------------------------------------------------------------------------
2015 40
----------------------------------------------------------------------------------------------------------------
2016 50
----------------------------------------------------------------------------------------------------------------
2017 60
----------------------------------------------------------------------------------------------------------------
2018 70
----------------------------------------------------------------------------------------------------------------
2019 80
----------------------------------------------------------------------------------------------------------------
2020 and thereafter 90
----------------------------------------------------------------------------------------------------------------
``(II) Any person who produced or imported
any class II substance during calendar year
2004, 2005, or 2006 may participate in the
auction. No other persons may participate in
the auction unless permitted to do so pursuant
to subclause (III).
``(III) Not later than 3 years after the
date of the initial auction and from time to
time thereafter, the Administrator shall
determine through rulemaking whether any
persons who did not produce or import a class
II substance during calendar year 2004, 2005,
or 2006 will be permitted to participate in
future auctions. The Administrator shall base
this determination on the duration,
consistency, and scale of such person's
purchases of consumption allowances in the
secondary pool under subparagraph (D)(ii)(III),
as well as economic or technical hardship and
other factors deemed relevant by the
Administrator.
``(IV) The Administrator shall set a
minimum bid per consumption allowance of the
following:
``(aa) For vintage year 2012,
$1.00.
``(bb) For vintage year 2013,
$1.20.
``(cc) For vintage year 2014,
$1.40.
``(dd) For vintage year 2015,
$1.60.
``(ee) For vintage year 2016,
$1.80.
``(ff) For vintage year 2017,
$2.00.
``(gg) For vintage year 2018 and
thereafter, $2.00 adjusted for
inflation after vintage year 2017 based
upon the producer price index as
published by the Department of
Commerce.
``(ii) Non-auction sale.--(I) For each
calendar year, as soon as practicable after
auction, the Administrator shall offer for sale
the remaining consumption allowances in the
producer-importer pool at the following prices:
``(aa) A fee of $1.00 per vintage
year 2012 allowance.
``(bb) A fee of $1.20 per vintage
year 2013 allowance.
``(cc) A fee of $1.40 per vintage
year 2014 allowance.
``(dd) For each vintage year 2015
allowance, a fee equal to the average
of $1.10 and the auction clearing price
for vintage year 2014 allowances.
``(ee) For each vintage year 2016
allowance, a fee equal to the average
of $1.30 and the auction clearing price
for vintage year 2015 allowances.
``(ff) For each vintage year 2017
allowance, a fee equal to the average
of $1.40 and the auction clearing price
for vintage year 2016 allowances.
``(gg) For each allowance of
vintage year 2018 and subsequent
vintage years, a fee equal to the
auction clearing price for that vintage
year.
``(II) The Administrator shall offer to
sell the remaining consumption allowances in
the producer-importer pool to producers of
class II, group II substances and importers of
class II, group II substances in proportion to
their relative allocation share.
``(III) Such allocation share for such sale
shall be determined by the Administrator using
such producer's or importer's annual average
data on class II substances from calendar years
2004, 2005, and 2006, on a carbon dioxide
equivalent basis, and--
``(aa) shall be based on a
producer's production, plus
importation, plus acquisitions and
purchases from persons who produced
class II substances in the United
States during calendar year 2004, 2005,
or 2006, less exportation, less
transfers and sales to persons who
produced class II substances in the
United States during calendar year
2004, 2005, or 2006; and
``(bb) for an importer of class II
substances that did not produce in the
United States any class II substance
during calendar years 2004, 2005, and
2006, shall be based on the importer's
importation less exportation.
For purposes of item (aa), the Administrator
shall account for 100 percent of class II,
group II substances and 60 percent of class II,
group I substances. For purposes of item (bb),
the Administrator shall account for 100 percent
of class II, group II substances and 100
percent of class II, group I substances.
``(IV) Any consumption allowances made
available for nonauction sale to a specific
producer or importer of class II, group II
substances but not purchased by the specific
producer or importer shall be made available
for sale to any producer or importer of class
II substances during calendar year 2004, 2005,
or 2006. If demand for such consumption
allowances exceeds supply of such consumption
allowances, the Administrator shall develop and
utilize criteria for the sale of such
consumption allowances that may include pro
rata shares, historic production and
importation, economic or technical hardship, or
other factors deemed relevant by the
Administrator. If the supply of such
consumption allowances exceeds demand, the
Administrator may offer such consumption
allowances for sale in the secondary pool as
set forth in subparagraph (D).
``(D) Secondary pool.--(i) For each calendar year,
as soon as practicable after the auction required in
subparagraph (C), the Administrator shall offer for
sale the consumption allowances in the secondary pool
at the prices listed in subparagraph (C)(ii).
``(ii) The Administrator shall accept applications
for purchase of secondary pool consumption allowances
from--
``(I) importers of products containing
class II, group II substances;
``(II) persons who purchased any class II,
group II substance directly from a producer or
importer of class II, group II substances for
use in a product containing a class II, group
II substance, a manufacturing process, or a
reclamation process;
``(III) persons who did not produce or
import a class II substance during calendar
year 2004, 2005, or 2006, but who the
Administrator determines have subsequently
taken significant steps to produce or import a
substantial quantity of any class II, group II
substance; and
``(IV) persons who produced or imported any
class II substance during calendar year 2004,
2005, or 2006.
``(iii) If the supply of consumption allowances in
the secondary pool equals or exceeds the demand for
consumption allowances in the secondary pool as
presented in the applications for purchase, the
Administrator shall sell the consumption allowances in
the secondary pool to the applicants in the amounts
requested in the applications for purchase. Any
consumption allowances in the secondary pool not
purchased in a calendar year may be rolled over and
added to the quantity available in the secondary pool
in the following year.
``(iv) If the demand for consumption allowances in
the secondary pool as presented in the applications for
purchase exceeds the supply of consumption allowances
in the secondary pool, the Administrator shall sell the
consumption allowances as follows:
``(I) The Administrator shall first sell
the consumption allowances in the secondary
pool to any importers of products containing
class II, group II substances in the amounts
requested in their applications for purchase.
If the demand for such consumption allowances
exceeds supply of such consumption allowances,
the Administrator shall develop and utilize
criteria for the sale of such consumption
allowances among importers of products
containing class II, group II substances that
may include pro rata shares, historic
importation, economic or technical hardship, or
other factors deemed relevant by the
Administrator.
``(II) The Administrator shall next sell
any remaining consumption allowances to persons
identified in subclauses (II) and (III) of
clause (ii) in the amounts requested in their
applications for purchase. If the demand for
such consumption allowances exceeds remaining
supply of such consumption allowances, the
Administrator shall develop and utilize
criteria for the sale of such consumption
allowances among subclauses (II) and (III)
applicants that may include pro rata shares,
historic use, economic or technical hardship,
or other factors deemed relevant by the
Administrator.
``(III) The Administrator shall then sell
any remaining consumption allowances to persons
who produced or imported any class II substance
during calendar year 2004, 2005, or 2006 in the
amounts requested in their applications for
purchase. If demand for such consumption
allowances exceeds remaining supply of such
consumption allowances, the Administrator shall
develop and utilize criteria for the sale of
such consumption allowances that may include
pro rata shares, historic production and
importation, economic or technical hardship, or
other factors deemed relevant by the
Administrator.
``(IV) Each person who purchases
consumption allowances in a non-auction sale
under this subparagraph shall be required to
disclose the person or entity sponsoring or
benefitting from the purchases if such person
or entity is, in whole or in part, other than
the purchaser or the purchaser's employer.
``(E) Discretion to withhold allowances.--Nothing
in this paragraph prevents the Administrator from
exercising discretion to withhold and retire
consumption allowances that would otherwise be
available for auction or nonauction sale. Not later
than 18 months after the date of enactment of this
section, the Administrator shall promulgate regulations
establishing criteria for withholding and retiring
consumption allowances.
``(5) Banking.--A consumption allowance or destruction
offset credit may be used to meet the compliance obligation
requirements of paragraph (1) in--
``(A) the vintage year for the allowance or
destruction offset credit; or
``(B) any calendar year subsequent to the vintage
year for the allowance or destruction offset credit.
``(6) Auctions.--
``(A) Initial regulations.--Not later than 18
months after the date of enactment of this section, the
Administrator shall promulgate regulations governing
the auction of allowances under this section. Such
regulations shall include the following requirements:
``(i) Frequency; first auction.--Auctions
shall be held one time per year at regular
intervals, with the first auction to be held no
later than October 31, 2011.
``(ii) Auction format.--Auctions shall
follow a single-round, sealed-bid, uniform
price format.
``(iii) Financial assurance.--The
Administrator may establish financial assurance
requirements to ensure that auction
participants can and will perform on their
bids.
``(iv) Disclosure of beneficial
ownership.--Each bidder in the auction shall be
required to disclose the person or entity
sponsoring or benefitting from the bidder's
participation in the auction if such person or
entity is, in whole or in part, other than the
bidder.
``(v) Publication of information.--After
the auction, the Administrator shall, in a
timely fashion, publish the number of bidders,
number of winning bidders, the quantity of
allowances sold, and the auction clearing
price.
``(vi) Bidding limits in 2012.--In the
vintage year 2012 auction, no auction
participant may, directly or in concert with
another participant, bid for or purchase more
allowances offered for sale at the auction than
the greater of--
``(I) the number of allowances
which, when added to the number of
allowances available for purchase by
the participant in the producer-
importer pool non-auction sale, would
equal the participant's annual average
consumption of class II, group II
substances in calendar years 2004,
2005, and 2006; or
``(II) the number of allowances
equal to the product of--
``(aa) 1.20 multiplied by
the participant's allocation
share of the producer-importer
pool non-auction sale as
determined under paragraph
(4)(C)(ii); and
``(bb) the number of
vintage year 2012 allowances
offered at auction.
``(vii) Bidding limits in 2013.--In the
vintage year 2013 auction, no auction
participant may, directly or in concert with
another participant, bid for or purchase more
allowances offered for sale at the auction than
the product of--
``(I) 1.15 multiplied by the ratio
of the total number of vintage year
2012 allowances purchased by the
participant from the auction and from
the producer-importer pool non-auction
sale to the total number of vintage
year 2012 allowances in the producer-
importer pool; and
``(II) the number of vintage year
2013 allowances offered at auction.
``(viii) Bidding limits in subsequent
years.--In the auctions for vintage year 2014
and subsequent vintage years, no auction
participant may, directly or in concert with
another participant, bid for or purchase more
allowances offered for sale at the auction than
the product of--
``(I) 1.15 multiplied by the ratio
of the highest number of allowances
required to be held by the participant
in any of the three prior vintage years
to meet its compliance obligation under
paragraph (1) to the total number of
allowances in the producer-importer
pool for such vintage year; and
``(II) the number of allowances
offered at auction for that vintage
year.
``(ix) Other requirements.--The
Administrator may include in the regulations
such other requirements or provisions as the
Administrator considers necessary to promote
effective, efficient, transparent, and fair
administration of auctions under this section.
``(B) Revision of regulations.--The Administrator
may, at any time, revise the initial regulations
promulgated under subparagraph (A) based on the
Administrator's experience in administering allowance
auctions by promulgating new regulations. Such revised
regulations need not meet the requirements identified
in subparagraph (A) if the Administrator determines
that an alternative auction design would be more
effective, taking into account factors including costs
of administration, transparency, fairness, and risks of
collusion or manipulation. In determining whether and
how to revise the initial regulations under this
paragraph, the Administrator shall not consider
maximization of revenues to the Federal Government.
``(C) Delegation or contract.--Pursuant to
regulations under this section, the Administrator may,
by delegation or contract, provide for the conduct of
auctions under the Administrator's supervision by other
departments or agencies of the Federal Government or by
nongovernmental agencies, groups, or organizations.
``(7) Payments for allowances.--
``(A) Initial regulations.--Not later than 18
months after the date of enactment of this section, the
Administrator shall promulgate regulations governing
the payment for allowances purchased in auction and
non-auction sales under this section. Such regulations
shall include the requirement that, in the event that
full payment for purchased allowances is not made on
the date of purchase, equal payments shall be made one
time per calendar quarter with all payments for
allowances of a vintage year made by the end of that
vintage year.
``(B) Revision of regulations.--The Administrator
may, at any time, revise the initial regulations
promulgated under subparagraph (A) based on the
Administrator's experience in administering collection
of payments by promulgating new regulations. Such
revised regulations need not meet the requirements
identified in subparagraph (A) if the Administrator
determines that an alternative payment structure or
frequency would be more effective, taking into account
factors including cost of administration, transparency,
and fairness. In determining whether and how to revise
the initial regulations under this paragraph, the
Administrator shall not consider maximization of
revenues to the Federal Government.
``(C) Penalties for non-payment.--Failure to pay
for purchased allowances in accordance with the
regulations promulgated pursuant to this paragraph
shall be a violation of the requirements of subsection
(b). Section 113(c)(3) shall apply in the case of any
person who knowingly fails to pay for purchased
allowances in accordance with the regulations
promulgated pursuant to this paragraph.
``(8) Imported products.--If the United States becomes a
party or otherwise adheres to a multilateral agreement,
including any amendment to the Montreal Protocol on Substances
That Deplete the Ozone Layer, which restricts the production or
consumption of class II, group II substances--
``(A) as of the date on which such agreement or
amendment enters into force, it shall no longer be
unlawful for any person to import from a party to such
agreement or amendment any product containing any class
II, group II substance whose production or consumption
is regulated by such agreement or amendment without
holding one consumption allowance or one destruction
offset credit for each carbon dioxide equivalent ton of
the class II, group II substance;
``(B) the Administrator shall promulgate
regulations within 12 months of the date the United
States becomes a party or otherwise adheres to such
agreement or amendment, or the date on which such
agreement or amendment enters into force, whichever is
later, to establish a new baseline for purposes of
paragraph (2), which new baseline shall be the original
baseline less the carbon dioxide equivalent of the
annual average quantity of any class II substances
regulated by such agreement or amendment contained in
products imported from parties to such agreement or
amendment in calendar years 2004, 2005, and 2006;
``(C) as of the date on which such agreement or
amendment enters into force, no person importing any
product containing any class II, group II substance
may, directly or in concert with another person,
purchase any consumption allowances for sale by the
Administrator for the importation of products from a
party to such agreement or amendment that contain any
class II, group II substance restricted by such
agreement or amendment; and
``(D) the Administrator may adjust the two
allowance pools established in paragraph (4) such that
up to 90 percent of the consumption allowances
available for a calendar year are placed in the
producer-importer pool with the remaining consumption
allowances placed in the secondary pool.
``(9) Offsets.--
``(A) Chlorofluorocarbon destruction.--Within 18
months after the date of enactment of this section, the
Administrator shall promulgate regulations to provide
for the issuance of offset credits for the destruction,
in the calendar year 2012 or later, of
chlorofluorocarbons in the United States. The
Administrator shall establish and distribute to the
destroying entity a quantity of destruction offset
credits equal to 0.8 times the number of metric tons of
carbon dioxide equivalents of reduction achieved
through the destruction. No destruction offset credits
shall be established for the destruction of a class II,
group II substance.
``(B) Definition.--For purposes of this paragraph,
the term `destruction' means the conversion of a
substance by thermal, chemical, or other means to
another substance with little or no carbon dioxide
equivalent value and no ozone depletion potential.
``(C) Regulations.--The regulations promulgated
under this paragraph shall include standards and
protocols for project eligibility, certification of
destroyers, monitoring, tracking, destruction
efficiency, quantification of project and baseline
emissions and carbon dioxide equivalent value, and
verification. The Administrator shall ensure that
destruction offset credits represent real and
verifiable destruction of chlorofluorocarbons or other
class I or class II, group I, substances authorized
under subparagraph (D).
``(D) Other substances.--The Administrator may
promulgate regulations to add to the list of class I
and class II, group I, substances that may be destroyed
for destruction offset credits, taking into account a
candidate substance's carbon dioxide equivalent value,
ozone depletion potential, prevalence in banks in the
United States, and emission rates, as well as the need
for additional cost containment under the class II,
group II cap and the integrity of the class II, group
II cap. The Administrator shall not add a class I or
class II, group I substance to the list if the
consumption of the substance has not been completely
phased-out internationally (except for essential use
exemptions or other similar exemptions) pursuant to the
Montreal Protocol.
``(E) Extension of offsets.--(i) At any time after
the Administrator promulgates regulations pursuant to
subparagraph (A), the Administrator may, pursuant to
the requirements of part D of title VII and based on
the carbon dioxide equivalent value of the substance
destroyed, add the types of destruction projects
authorized to receive destruction offset credits under
this paragraph to the list of types of projects
eligible for offset credits under section 733. If such
projects are added to the list under section 733, the
issuance of offset credits for such projects under part
D of title VII shall be governed by the requirements of
such part D, while the issuance of offset credits for
such projects under this paragraph shall be governed by
the requirements of this paragraph. Nothing in this
paragraph shall affect the issuance of offset credits
under section 740.
``(ii) The Administrator shall not make the
addition under clause (i) unless the Administrator
finds that insufficient destruction is occurring or is
projected to occur under this paragraph and that the
addition would increase destruction.
``(iii) In no event shall more than one destruction
offset credit be issued under title VII and this
section for the destruction of the same quantity of a
substance.
``(10) Legal status of allowances and credits.--None of the
following constitutes a property right:
``(A) A production or consumption allowance.
``(B) A destruction offset credit.
``(c) Deadlines for Compliance.--Notwithstanding the deadlines
specified for class II substances in sections 608, 609, 610, 612, and
613 that occur prior to January 1, 2009, the deadline for promulgating
regulations under those sections for class II, group II substances
shall be January 1, 2012.
``(d) Exceptions for Essential Uses.--Notwithstanding any phase
down of production and consumption required by this section, to the
extent consistent with any applicable multilateral agreement to which
the United States is a party or otherwise adheres, the Administrator
may provide the following exceptions for essential uses:
``(1) Medical devices.--The Administrator, after notice and
opportunity for public comment, and in consultation with the
Commissioner of the Food and Drug Administration, may provide
an exception for the production and consumption of class II,
group II substances solely for use in medical devices.
``(2) Aviation and space vehicle safety.--The
Administrator, after notice and opportunity for public comment,
may authorize the production and consumption of limited
quantities of class II, group II substances solely for the
purposes of aviation or space vehicle safety if either the
Administrator of the Federal Aviation Administration or the
Administrator of the National Aeronautics and Space
Administration, in consultation with the Administrator,
determines that no safe and effective substitute has been
developed and that such authorization is necessary for aviation
or space flight safety purposes.
``(e) Developing Countries.--Notwithstanding any phase down of
production required by this section, the Administrator, after notice
and opportunity for public comment, may authorize the production of
limited quantities of class II, group II substances in excess of the
amounts otherwise allowable under this section solely for export to,
and use in, developing countries. Any production authorized under this
subsection shall be solely for purposes of satisfying the basic
domestic needs of such countries as provided in applicable
international agreements, if any, to which the United States is a party
or otherwise adheres.
``(f) National Security; Fire Suppression, etc.--The provisions of
subsection (f) and paragraphs (1) and (2) of subsection (g) of section
604 shall apply to any consumption and production phase down of class
II, group II substances in the same manner and to the same extent,
consistent with any applicable international agreement to which the
United States is a party or otherwise adheres, as such provisions apply
to the substances specified in such subsection.
``(g) Accelerated Schedule.--In lieu of section 606, the provisions
of paragraphs (1), (2), and (3) of this subsection shall apply in the
case of class II, group II substances.
``(1) In general.--The Administrator shall promulgate
initial regulations not later than 18 months after the date of
enactment of this section, and revised regulations any time
thereafter, which establish a schedule for phasing down the
consumption (and, if the condition in subsection (b)(1)(B) is
met, the production) of class II, group II substances that is
more stringent than the schedule set forth in this section if,
based on the availability of substitutes, the Administrator
determines that such more stringent schedule is practicable,
taking into account technological achievability, safety, and
other factors the Administrator deems relevant, or if the
Montreal Protocol, or any applicable international agreement to
which the United States is a party or otherwise adheres, is
modified or established to include a schedule or other
requirements to control or reduce production, consumption, or
use of any class II, group II substance more rapidly than the
applicable schedule under this section.
``(2) Petition.--Any person may submit a petition to
promulgate regulations under this subsection in the same manner
and subject to the same procedures as are provided in section
606(b).
``(3) Inconsistency.--If the Administrator determines that
the provisions of this section regarding banking, allowance
rollover, or destruction offset credits create a significant
potential for inconsistency with the requirements of any
applicable international agreement to which the United States
is a party or otherwise adheres, the Administrator may
promulgate regulations restricting the availability of banking,
allowance rollover, or destruction offset credits to the extent
necessary to avoid such inconsistency.
``(h) Exchange.--Section 607 shall not apply in the case of class
II, group II substances. Production and consumption allowances for
class II, group II substances may be freely exchanged or sold but may
not be converted into allowances for class II, group I substances.
``(i) Labeling.--(1) In applying section 611 to products containing
or manufactured with class II, group II substances, in lieu of the
words `destroying ozone in the upper atmosphere' on labels required
under section 611 there shall be substituted the words `contributing to
global warming'.
``(2) The Administrator may, through rulemaking, exempt from the
requirements of section 611 products containing or manufactured with
class II, group II substances determined to have little or no carbon
dioxide equivalent value compared to other substances used in similar
products.
``(j) Nonessential Products.--For the purposes of section 610,
class II, group II substances shall be regulated under section 610(b),
except that in applying section 610(b) the word `hydrofluorocarbon'
shall be substituted for the word `chlorofluorocarbon' and the term
`class II, group II' shall be substituted for the term `class I'. Class
II, group II substances shall not be subject to the provisions of
section 610(d).
``(k) International Transfers.--In the case of class II, group II
substances, in lieu of section 616, this subsection shall apply. To the
extent consistent with any applicable international agreement to which
the United States is a party or otherwise adheres, including any
amendment to the Montreal Protocol, the United States may engage in
transfers with other parties to such agreement or amendment under the
following conditions:
``(1) The United States may transfer production allowances
to another party to such agreement or amendment if, at the time
of the transfer, the Administrator establishes revised
production limits for the United States accounting for the
transfer in accordance with regulations promulgated pursuant to
this subsection.
``(2) The United States may acquire production allowances
from another party to such agreement or amendment if, at the
time of the transfer, the Administrator finds that the other
party has revised its domestic production limits in the same
manner as provided with respect to transfers by the United
States in the regulations promulgated pursuant to this
subsection.
``(l) Relationship to Other Laws.--
``(1) State laws.--For purposes of section 116, the
requirements of this section for class II, group II substances
shall be treated as requirements for the control and abatement
of air pollution.
``(2) Multilateral agreements.--Section 614 shall apply to
the provisions of this section concerning class II, group II
substances, except that for the words `Montreal Protocol' there
shall be substituted the words `Montreal Protocol, or any
applicable multilateral agreement to which the United States is
a party or otherwise adheres that restricts the production or
consumption of class II, group II substances,' and for the
words `Article 4 of the Montreal Protocol' there shall be
substituted `any provision of such multilateral agreement
regarding trade with non-parties'.
``(3) Federal facilities.--For purposes of section 118, the
requirements of this section for class II, group II substances
and corresponding State, interstate, and local requirements,
administrative authority, and process and sanctions shall be
treated as requirements for the control and abatement of air
pollution within the meaning of section 118.
``(m) Carbon Dioxide Equivalent Value.--(1) In lieu of section
602(e), the provisions of this subsection shall apply in the case of
class II, group II substances. Simultaneously with establishing the
list of class II, group II substances, and simultaneously with any
addition to that list, the Administrator shall publish the carbon
dioxide equivalent value of each listed class II, group II substance,
based on a determination of the number of metric tons of carbon dioxide
that makes the same contribution to global warming over 100 years as 1
metric ton of each class II, group II substance.
``(2) Not later than February 1, 2017, and not less than every 5
years thereafter, the Administrator shall--
``(A) review, and if appropriate, revise the carbon dioxide
equivalent values established for class II, group II substances
based on a determination of the number of metric tons of carbon
dioxide that makes the same contributions to global warming
over 100 years as 1 metric ton of each class II, group II
substance; and
``(B) publish in the Federal Register the results of that
review and any revisions.
``(3) A revised determination published in the Federal Register
under paragraph (2)(B) shall take effect for production of class II,
group II substances, consumption of class II, group II substances, and
importation of products containing class II, group II substances
starting on January 1 of the first calendar year starting at least 9
months after the date on which the revised determination was published.
``(4) The Administrator may decrease the frequency of review and
revision under paragraph (2) if the Administrator determines that such
decrease is appropriate in order to synchronize such review and
revisions with any similar review process carried out pursuant to the
United Nations Framework Convention on Climate Change, an agreement
negotiated under that convention, The Vienna Convention for the
Protection of the Ozone Layer, or an agreement negotiated under that
convention, except that in no event shall the Administrator carry out
such review and revision any less frequently than every 10 years.
``(n) Reporting Requirements.--In lieu of subsections (b) and (c)
of section 603, paragraphs (1) and (2) of this subsection shall apply
in the case of class II, group II substances:
``(1) In general.--On a quarterly basis, or such other
basis (not less than annually) as determined by the
Administrator, each person who produced, imported, or exported
a class II, group II substance, or who imported a product
containing a class II, group II substance, shall file a report
with the Administrator setting forth the carbon dioxide
equivalent amount of the substance that such person produced,
imported, or exported, as well as the amount that was contained
in products imported by that person, during the preceding
reporting period. Each such report shall be signed and attested
by a responsible officer. If all other reporting is complete,
no such report shall be required from a person after April 1 of
the calendar year after such person permanently ceases
production, importation, and exportation of the substance, as
well as importation of products containing the substance, and
so notifies the Administrator in writing. If the United States
becomes a party or otherwise adheres to a multilateral
agreement, including any amendment to the Montreal Protocol on
Substances That Deplete the Ozone Layer, that restricts the
production or consumption of class II, group II substances,
then, if all other reporting is complete, no such report shall
be required from a person with respect to importation from
parties to such agreement or amendment of products containing
any class II, group II substance restricted by such agreement
or amendment, after April 1 of the calendar year following the
year during which such agreement or amendment enters into
force.
``(2) Baseline reports for class ii, group ii substances.--
``(A) In general.--Unless such information has been
previously reported to the Administrator, on the date
on which the first report under paragraph (1) of this
subsection is required to be filed, each person who
produced, imported, or exported a class II, group II
substance, or who imported a product containing a class
II substance, (other than a substance added to the list
of class II, group II substances after the publication
of the initial list of such substances under this
section), shall file a report with the Administrator
setting forth the amount of such substance that such
person produced, imported, exported, or that was
contained in products imported by that person, during
each of calendar years 2004, 2005, and 2006.
``(B) Producers.--In reporting under subparagraph
(A), each person who produced in the United States a
class II substance during calendar year 2004, 2005, or
2006 shall--
``(i) report all acquisitions or purchases
of class II substances during each of calendar
years 2004, 2005, and 2006 from all other
persons who produced in the United States a
class II substance during calendar year 2004,
2005, or 2006, and supply evidence of such
acquisitions and purchases as deemed necessary
by the Administrator; and
``(ii) report all transfers or sales of
class II substances during each of calendar
years 2004, 2005, and 2006 to all other persons
who produced in the United States a class II
substance during calendar year 2004, 2005, or
2006, and supply evidence of such transfers and
sales as deemed necessary by the Administrator.
``(C) Added substances.--In the case of a substance
added to the list of class II, group II substances
after publication of the initial list of such
substances under this section, each person who
produced, imported, exported, or imported products
containing such substance in calendar year 2004, 2005,
or 2006 shall file a report with the Administrator
within 180 days after the date on which such substance
is added to the list, setting forth the amount of the
substance that such person produced, imported, and
exported, as well as the amount that was contained in
products imported by that person, in calendar years
2004, 2005, and 2006.
``(o) Stratospheric Ozone and Climate Protection Fund.--
``(1) In general.--There is established in the Treasury of
the United States a Stratospheric Ozone and Climate Protection
Fund.
``(2) Deposits.--The Administrator shall deposit all
proceeds from the auction and non-auction sale of allowances
under this section into the Stratospheric Ozone and Climate
Protection Fund.
``(3) Use.--Amounts deposited into the Stratospheric Ozone
and Climate Protection Fund shall be available, subject to
appropriations, exclusively for the following purposes:
``(A) Recovery, recycling, and reclamation.--The
Administrator may utilize funds to establish a program
to incentivize the recovery, recycling, and reclamation
of any Class II substances in order to reduce emissions
of such substances.
``(B) Multilateral fund.--If the United States
becomes a party or otherwise adheres to a multilateral
agreement, including any amendment to the Montreal
Protocol on Substances That Deplete the Ozone Layer,
which restricts the production or consumption of class
II, group II substances, the Administrator may utilize
funds to meet any related contribution obligation of
the United States to the Multilateral Fund for the
Implementation of the Montreal Protocol or similar
multilateral fund established under such multilateral
agreement.
``(C) Best-in-class appliances deployment
program.--The Secretary of Energy is authorized to
utilize funds to carry out the purposes of section 214
of the American Clean Energy and Security Act of 2009.
``(D) Low global warming product transition
assistance program.--
``(i) In general.--The Administrator, in
consultation with the Secretary of Energy, may
utilize funds in fiscal years 2012 through 2022
to establish a program to provide financial
assistance to manufacturers of products
containing class II, group II substances to
facilitate the transition to products that
contain or utilize alternative substances with
no or low carbon dioxide equivalent value and
no ozone depletion potential.
``(ii) Definition.--In this subparagraph,
the term `products' means refrigerators,
freezers, dehumidifiers, air conditioners, foam
insulation, technical aerosols, fire protection
systems, and semiconductors.
``(iii) Financial assistance.--The
Administrator may provide financial assistance
to manufacturers pursuant to clause (i) for--
``(I) the design and configuration
of new products that use alternative
substances with no or low carbon
dioxide equivalent value and no ozone
depletion potential; and
``(II) the redesign and retooling
of facilities for the manufacture of
products in the United States that use
alternative substances with no or low
carbon dioxide equivalent value and no
ozone depletion potential.
``(iv) Reports.--For any fiscal year during
which the Administrator provides financial
assistance pursuant to this subparagraph, the
Administrator shall submit a report to the
Congress within 3 months of the end of such
fiscal year detailing the amounts, recipients,
specific purposes, and results of the financial
assistance provided.''.
(b) Table of Contents.--The table of contents of title VI of the
Clean Air Act (42 U.S.C. 7671 et seq.) is amended by adding the
following new item at the end thereof:
``Sec. 619. Hydrofluorocarbons (HFCs).''.
(c) Fire Suppression Agents.--Section 605(a) of the Clean Air Act
(42 U.S.C. 7671(a)) is amended--
(1) by striking ``or'' at the end of paragraph (2);
(2) by striking the period at the end of paragraph (3) and
inserting ``; or''; and
(3) by adding the following new paragraph after paragraph
(3):
``(4) is listed as acceptable for use as a fire suppression
agent for nonresidential applications in accordance with
section 612(c).''.
(d) Motor Vehicle Air Conditioners.--
(1) Section 609(e) of the Clean Air Act (42 U.S.C.
7671h(e)) is amended by inserting ``, group I'' after each
reference to ``class II'' in the text and heading.
(2) Section 609 of the Clean Air Act (42 U.S.C. 7671h) is
amended by adding the following new subsection after subsection
(e):
``(f) Class II, Group II Substances.--
``(1) Repair.--The Administrator may promulgate regulations
establishing requirements for repair of motor vehicle air
conditioners prior to adding a class II, group II substance.
``(2) Small containers.--(A) The Administrator may
promulgate regulations establishing servicing practices and
procedures for recovery of class II, group II substances from
containers which contain less than 20 pounds of such class II,
group II substances.
``(B) Not later than 18 months after enactment of this
subsection, the Administrator shall either promulgate
regulations requiring that containers which contain less than
20 pounds of a class II, group II substance be equipped with a
device or technology that limits refrigerant emissions and
leaks from the container and limits refrigerant emissions and
leaks during the transfer of refrigerant from the container to
the motor vehicle air conditioner or issue a determination that
such requirements are not necessary or appropriate.
``(C) Not later than 18 months after enactment of this
subsection, the Administrator shall promulgate regulations
establishing requirements for consumer education materials on
best practices associated with the use of containers which
contain less than 20 pounds of a class II, group II substance
and prohibiting the sale or distribution, or offer for sale or
distribution, of any class II, group II substance in any
container which contains less than 20 pounds of such class II,
group II substance, unless consumer education materials
consistent with such requirements are displayed and available
at point-of-sale locations, provided to the consumer, or
included in or on the packaging of the container which contain
less than 20 pounds of a class II, group II substance.
``(D) The Administrator may, through rulemaking, extend the
requirements established under this paragraph to containers
which contain 30 pounds or less of a class II, group II
substance if the Administrator determines that such action
would produce significant environmental benefits.
``(3) Restriction of sales.--Effective January 1, 2014, no
person may sell or distribute or offer to sell or distribute or
otherwise introduce into interstate commerce any motor vehicle
air conditioner refrigerant in any size container unless the
substance has been found acceptable for use in a motor vehicle
air conditioner under section 612.''.
(e) Safe Alternatives Policy.--Section 612(e) of the Clean Air Act
(42 U.S.C. 7671k(e)) is amended by inserting ``or class II'' after each
reference to ``class I''.
SEC. 333. BLACK CARBON.
(a) Definition.--As used in this section, the term ``black carbon''
means primary light absorbing aerosols, as defined by the
Administrator, based on the best available science.
(b) Black Carbon Abatement Report.--Not later than 1 year after the
date of enactment of this section, the Administrator shall, in
consultation with other appropriate Federal agencies, submit to
Congress a report regarding black carbon emissions. The report shall
include the following:
(1) A summary of the current information and research that
identifies--
(A) an inventory of the major sources of black
carbon emissions in the United States and throughout
the world, including--
(i) an estimate of the quantity of current
and projected future emissions; and
(ii) the net climate forcing of the
emissions from such sources, including
consideration of co-emissions of other
pollutants;
(B) effective and cost-effective control
technologies, operations, and strategies for additional
domestic and international black carbon emissions
reductions, such as diesel retrofit technologies on
existing on-road, non-road, and stationary engines and
programs to address residential cookstoves, and forest
and agriculture-based burning;
(C) potential metrics and approaches for
quantifying the climatic effects of black carbon
emissions, including its radiative forcing and warming
effects, that may be used to compare the climate
benefits of different mitigation strategies, including
an assessment of the uncertainty in such metrics and
approaches; and
(D) the public health and environmental benefits
associated with additional controls for black carbon
emissions.
(2) Recommendations regarding--
(A) development of additional emissions monitoring
techniques and capabilities, modeling, and other black
carbon-related areas of study;
(B) areas of focus for additional study of
technologies, operations, and strategies with the
greatest potential to reduce emissions of black carbon
and associated public health, economic, and
environmental impacts associated with these emissions;
and
(C) actions, in addition to those identified by the
Administrator under section 851 of the Clean Air Act
(as added by subsection (c)), the Federal Government
may take to encourage or require reductions in black
carbon emissions.
(c) Black Carbon Mitigation.--Title VIII of the Clean Air Act, as
added by section 331 of this Act, and amended by section 222 of this
Act, is further amended by adding after part D the following new part:
``PART E--BLACK CARBON
``SEC. 851. BLACK CARBON.
``(a) Domestic Black Carbon Mitigation.--Not later than 18 months
after the date of enactment of this section, the Administrator, taking
into consideration the public health and environmental impacts of black
carbon emissions, including the effects on global and regional warming,
the Arctic, and other snow and ice-covered surfaces, shall propose
regulations under the existing authorities of this Act to reduce
emissions of black carbon or propose a finding that existing
regulations promulgated pursuant to this Act adequately regulate black
carbon emissions. Not later than 2 years after the date of enactment of
this section, the Administrator shall promulgate final regulations
under the existing authorities of this Act or finalize the proposed
finding. Such regulations shall not apply to specific types, classes,
categories, or other suitable groupings of emissions sources that the
Administrator finds are subject to adequate regulation.
``(b) International Black Carbon Mitigation.--
``(1) Report.--Not later than 1 year after the date of
enactment of this section, the Administrator, in coordination
with the Secretary of State and other appropriate Federal
agencies, shall transmit a report to Congress on the amount,
type, and direction of all present United States financial,
technical, and related assistance to foreign countries to
reduce, mitigate, and otherwise abate black carbon emissions.
``(2) Other opportunities.--The report required under
paragraph (1) shall also identify opportunities and
recommendations, including action under existing authorities,
to achieve significant black carbon emission reductions in
foreign countries through technical assistance or other
approaches to--
``(A) promote sustainable solutions to bring clean,
efficient, safe, and affordable stoves, fuels, or both
stoves and fuels to residents of developing countries
that are reliant on solid fuels such as wood, dung,
charcoal, coal, or crop residues for home cooking and
heating, so as to help reduce the public health,
environmental, and economic impacts of black carbon
emissions from these sources by--
``(i) identifying key regions for large-
scale demonstration efforts, and key partners
in each such region; and
``(ii) developing for each such region a
large-scale implementation strategy with a goal
of collectively reaching 20,000,000 homes over
5 years with interventions that will--
``(I) increase stove efficiency by
over 50 percent (or such other goal as
determined by the Administrator);
``(II) reduce emissions of black
carbon by over 60 percent (or such
other goal as determined by the
Administrator); and
``(III) reduce the incidence of
severe pneumonia in children under 5
years old by over 30 percent (or such
other goal as determined by the
Administrator);
``(B) make technological improvements to diesel
engines and provide greater access to fuels that emit
less or no black carbon;
``(C) reduce unnecessary agricultural or other
biomass burning where feasible alternatives exist;
``(D) reduce unnecessary fossil fuel burning that
produces black carbon where feasible alternatives
exist;
``(E) reduce other sources of black carbon
emissions; and
``(F) improve capacity to achieve greater
compliance with existing laws to address black carbon
emissions.''.
(d) Authorization of Appropriations.--There are authorized to be
appropriated such sums as are necessary to carry out this section.
SEC. 334. STATES.
Section 116 of the Clean Air Act (42 U.S.C. 7416) is amended by
adding the following at the end thereof: ``For the purposes of this
section, the phrases `standard or limitation respecting emissions of
air pollutants' and `requirements respecting control or abatement of
air pollution' shall include any provision to: cap greenhouse gas
emissions, require surrender to the State or a political subdivision
thereof of emission allowances or offset credits established or issued
under this Act, and require the use of such allowances or credits as a
means of demonstrating compliance with requirements established by a
State or political subdivision thereof.''.
SEC. 335. STATE PROGRAMS.
Title VIII of the Clean Air Act, as added by section 331 of this
Act and amended by several sections of this Act, is further amended by
adding after part E (as added by section 333(c) of this Act) the
following new part:
``PART F--MISCELLANEOUS
``SEC. 861. STATE PROGRAMS.
``Notwithstanding section 116, no State or political subdivision
thereof shall implement or enforce a cap and trade program that covers
any capped emissions emitted during the years 2012 through 2017. For
purposes of this section, the term `cap and trade program' means a
system of greenhouse gas regulation under which a State or political
subdivision issues a limited number of tradable instruments in the
nature of emission allowances and requires that sources within its
jurisdiction surrender such tradeable instruments for each unit of
greenhouse gases emitted during a compliance period. For purposes of
this section, a `cap-and-trade program' does not include a target or
limit on greenhouse gas emissions adopted by a State or political
subdivision that is implemented other than through the issuance and
surrender of a limited number of tradable instruments in the nature of
emission allowances, nor does it include any other standard, limit,
regulation, or program to reduce greenhouse gas emissions that is not
implemented through the issuance and surrender of a limited number of
tradeable instruments in the nature of emission allowances. For
purposes of this section, the term `cap and trade program' does not
include, among other things, fleet-wide motor vehicle emission
requirements that allow greater emissions with increased vehicle
production, or requirements that fuels, or other products, meet an
average pollution emission rate or lifecycle greenhouse gas standard.
``SEC. 862. GRANTS FOR SUPPORT OF AIR POLLUTION CONTROL PROGRAMS.
``The Administrator is authorized to make grants to air pollution
control agencies pursuant to section 105 for purposes of assisting in
the implementation of programs to address global warming established
under the Safe Climate Act.''.
SEC. 336. ENFORCEMENT.
(a) Remand.--Section 307(b) of the Clean Air Act (42 U.S.C.
7607(b)) is amended by adding the following new paragraphs at the end
thereof:
``(3) If the court determines that any action of the
Administrator is arbitrary, capricious, or otherwise unlawful,
the court may remand such action, without vacatur, if vacatur
would impair or delay protection of the environment or public
health or otherwise undermine the timely achievement of the
purposes of this Act.
``(4) If the court determines that any action of the
Administrator is arbitrary, capricious, or otherwise unlawful,
and remands the matter to the Administrator, the Administrator
shall complete final action on remand within an expeditious
time period no longer than the time originally allowed for the
action or 1 year, whichever is less, unless the court on motion
determines that a shorter or longer period is necessary,
appropriate, and consistent with the purposes of this Act. The
court of appeals shall have jurisdiction to enforce a deadline
for action on remand under this subparagraph.''.
(b) Petition for Reconsideration.--Section 307(d)(7)(B) of the
Clean Air Act (42 U.S.C. 7607(d)(7)(B)) is amended as follows:
(1) By inserting after the second sentence ``If a petition
for reconsideration is filed, the Administrator shall take
final action on such petition, including promulgation of final
action either revising or determining not to revise the action
for which reconsideration is sought, within 150 days after the
petition is received by the Administrator or the petition shall
be deemed denied for the purpose of judicial review.''.
(2) By amending the third sentence to read as follows:
``Such person may seek judicial review of such denial, or of
any other final action, by the Administrator, in response to a
petition for reconsideration, in the United States court of
appeals for the appropriate circuit (as provided in subsection
(b)).''.
SEC. 337. CONFORMING AMENDMENTS.
(a) Federal Enforcement.--Section 113 of the Clean Air Act (42
U.S.C. 7413) is amended as follows:
(1) In subsection (a)(3), by striking ``or title VI,'' and
inserting ``title VI, title VII, or title VIII''.
(2) In subsection (b), by striking ``or a major stationary
source'' and inserting ``a major stationary source, or a
covered EGU under title VIII'' in the material preceding
paragraph (1).
(3) In paragraph (2) of subsection (b), by striking ``or
title VI'' and inserting ``title VI, title VII, or title
VIII''.
(4) In subsection (c)--
(A) in the first sentence of paragraph (1), by
striking ``or title VI (relating to stratospheric ozone
control),'' and inserting ``title VI, title VII, or
title VIII,''; and
(B) in the first sentence of paragraph (3), by
striking ``or VI'' and inserting ``VI, VII, or VIII''.
(5) In subsection (d)(1)(B), by striking ``or VI'' and
inserting ``VI, VII, or VIII''.
(6) In subsection (f), in the first sentence, by striking
``or VI'' and inserting ``VI, VII, or VIII''.
(b) Retention of State Authority.--Section 116 of the Clean Air Act
(42 U.S.C. 7416) is amended as follows:
(1) By striking ``and 233'' and inserting ``233''.
(2) By striking ``of moving sources)'' and inserting ``of
moving sources), and 861 (preempting certain State greenhouse
gas programs for a limited time)''.
(c) Inspections, Monitoring, and Entry.--Section 114(a) of the
Clean Air Act (42 U.S.C. 7414(a)) is amended by striking ``section
112,'' and all that follows through ``(ii)'' and inserting the
following: ``section 112, or any regulation of greenhouse gas emissions
under title VII or VIII, (ii)''.
(d) Enforcement.--Subsection (f) of section 304 of the Clean Air
Act (42 U.S.C. 7604(f)) is amended as follows:
(1) By striking ``; or'' at the end of paragraph (3)
thereof and inserting a comma.
(2) By striking the period at the end of paragraph (4)
thereof and inserting ``, or''.
(3) By adding the following after paragraph (4) thereof:
``(5) any requirement of title VII or VIII.''.
(e) Administrative Proceedings and Judicial Review.--Section 307 of
the Clean Air Act (42 U.S.C. 7607) is amended as follows:
(1) In subsection (a), by striking ``, or section 306'' and
inserting ``section 306, or title VII or VIII''.
(2) In subsection (b)(1)--
(A) by striking ``,,'' and inserting ``,'' in each
place such punctuation appears; and
(B) by striking ``section 120,'' in the first
sentence and inserting ``section 120, any final action
under title VII or VIII,''.
(3) In subsection (d)(1) by amending subparagraph (S) to
read as follows:
``(S) the promulgation or revision of any
regulation under title VII or VIII,''.
SEC. 338. DAVIS-BACON COMPLIANCE.
(a) In General.--Notwithstanding any other provision of law and in
a manner consistent with other provisions in this Act, to receive
emission allowances or funding under this Act, or the amendments made
by this Act, the recipient shall provide reasonable assurances that all
laborers and mechanics employed by contractors and subcontractors on
projects funded directly by or assisted in whole or in part by and
through the Federal Government pursuant to this Act, or the amendments
made by this Act, or by any entity established in accordance with this
Act, or the amendments made by this Act, including the Carbon Storage
Research Corporation, will be paid wages at rates not less than those
prevailing on projects of a character similar in the locality as
determined by the Secretary of Labor in accordance with subchapter IV
of chapter 31 of title 40, United States Code (commonly known as the
``Davis-Bacon Act''). With respect to the labor standards specified in
this section, the Secretary of Labor shall have the authority and
functions set forth in Reorganization Plan Numbered 14 of 1950 (64
Stat. 1267; 5 U.S.C. App.) and section 3145 of title 40, United States
Code.
(b) Exemption.--Neither subsection (a) nor the requirements of
subchapter IV of chapter 31 of title 40, United States Code, shall
apply to retrofitting of the following:
(1) Single family homes (both attached and detached) under
section 202.
(2) Owner-occupied residential units in larger buildings
that have their own dedicated space-conditioning systems under
section 202.
(3) Residential buildings (as defined in section 202(a)(5))
if designed for residential use by less than 4 families.
(4) Nonresidential buildings (as defined in section
202(a)(1)) if the net interior space of such nonresidential
building is less than 6,500 square feet.
SEC. 339. NATIONAL STRATEGY FOR DOMESTIC BIOLOGICAL CARBON
SEQUESTRATION.
Not later than 1 year after the date of enactment of this Act, the
Administrator of the Environmental Protection Agency, in consultation
with the Secretary of Energy, the Secretary of Agriculture, the
Secretary of the Interior, and the heads of such other relevant Federal
agencies as the President may designate, shall submit to Congress a
report setting forth a unified and comprehensive strategy to address
the key legal, regulatory, technological, and other barriers to
maximizing the potential for sustainable biological sequestration of
carbon within the United States.
SEC. 340. REDUCING ACID RAIN AND MERCURY POLLUTION.
Not later than 18 months after the date of enactment of this Act,
the Administrator shall submit to Congress a report that analyzes the
effects of different carbon dioxide reduction strategies and
technologies on the emissions of mercury, sulfur dioxide, and nitrogen
oxide, which cause acid rain, particulate matter, ground level ozone,
mercury contamination, and other environmental problems. The report
shall assess a variety of carbon reduction technologies, including the
application of various carbon capture and sequestration technologies
for both new and existing power plants. The report shall assess the
current scientific and technical understanding of the interplay between
the various technologies and emissions of air pollutants, identify
hurdles to strategies that could cost-effectively reduce emissions of
multiple pollutants, and make appropriate recommendations.
Subtitle D--Carbon Market Assurance
SEC. 341. CARBON MARKET ASSURANCE.
(a) Amendment.--The Federal Power Act (16 U.S.C. 791a and
following) is amended by adding at the end the following:
``PART IV--CARBON MARKET ASSURANCE
``SEC. 401. OVERSIGHT AND ASSURANCE OF CARBON MARKETS.
``(a) Definitions.--In this section:
``(1) Covered entity.--The term `covered entity' shall have
the meaning given in section 700 of the Clean Air Act.
``(2) Regulated allowance.--The term `regulated allowance'
means any emission allowance, compensatory allowance, offset
credit, or Federal renewable electricity credit established or
issued under the American Clean Energy and Security Act of
2009.
``(3) Regulated instrument.--The term `regulated
instrument' means a regulated allowance or a regulated
allowance derivative.
``(b) Regulated Allowance Market.--
``(1) Authority.--The Commission shall promulgate
regulations for the establishment, operation, and oversight of
markets for regulated allowances not later than 18 months after
the date of the enactment of this section, and from time to
time thereafter as may be appropriate.
``(2) Regulations.--The regulations promulgated pursuant to
paragraph (1) shall--
``(A) provide for effective and comprehensive
market oversight;
``(B) prohibit fraud, market manipulation, and
excess speculation, and provide measures to limit
unreasonable fluctuation in the prices of regulated
allowances;
``(C) facilitate compliance with title VII of the
Clean Air Act by covered entities;
``(D) ensure market transparency and recordkeeping
deemed necessary and appropriate by the Commission to
provide for efficient price discovery; prevention of
fraud, market manipulation, and excess speculation; and
compliance with title VII of the Clean Air Act and
section 610 of the Public Utility Regulatory Policies
Act of 1978;
``(E) as necessary, ensure that position
limitations for individual market participants are
established with respect to each class of regulated
allowances;
``(F) as necessary, ensure that margin requirements
are established for each class of regulated allowances;
``(G) provide for the formation and operation of a
fair, orderly and liquid national market system that
allows for the best execution in the trading of
regulated allowances;
``(H) limit or eliminate counterparty risks, market
power concentration risks, and other risks associated
with trading regulated allowances outside of trading
facilities; and
``(I) establish standards for qualification as, and
operation of, trading facilities for regulated
allowances;
``(J) establish standards for qualification as, and
operation of, clearing organizations for trading
facilities for regulated allowances; and
``(K) include such other requirements as necessary
to preserve market integrity and facilitate compliance
with title VII of the Clean Air Act and section 610 of
the Public Utility Regulatory Policies Act of 1978 and
the regulations promulgated under such title and such
section.
``(3) Enforcement.--
``(A) In general.--If the Commission determines,
after notice and an opportunity for a hearing on the
record, that any entity has violated any rule or order
issued by the Commission under this subsection, the
Commission may issue an order--
``(i) prohibiting the entity from trading
on a trading facility for regulated allowances
registered with the Commission, and requiring
all such facilities to refuse the entity all
privileges for such period as may be specified
in the order;
``(ii) if the entity is registered with the
Commission in any capacity, suspending for a
period of not more than 6 months, or revoking,
the registration of the entity;
``(iii) assessing the entity a civil
penalty of not more than $1,000,000 per day per
violation for as long as the violation
continues (and in determining the amount of a
civil penalty, the Commission shall take into
account the nature and seriousness of the
violation and the efforts to remedy the
violation); and
``(iv) requiring disgorgement of unjust
profits, restitution to entities harmed by the
violation as determined by the Commission, or
both.
``(B) Authority to suspend or revoke
registration.--The Commission may suspend for a period
of not more than 6 months, or revoke, the registration
of a trading facility for regulated allowances or of a
clearing organization registered by the Commission if,
after notice and opportunity for a hearing on the
record, the Commission finds that--
``(i) the entity violated any rule or order
issued by the Commission under this subsection;
or
``(ii) a director, officer, employee, or
agent of the entity has violated any rule or
order issued by the Commission under this
subsection.
``(C) Cease and desist proceedings.--
``(i) In general.--If the Commission
determines that any entity may be violating,
may have violated, or may be about to violate
any provision of this part, or any regulation
promulgated by, or any restriction, condition,
or order made or imposed by, the Commission
under this Act, and if the Commission finds
that the alleged violation or threatened
violation, or the continuation of the
violation, is likely to result in significant
harm to covered entities or market
participants, or significant harm to the public
interest, the Commission may issue a temporary
order requiring the entity--
``(I) to cease and desist from the
violation or threatened violation;
``(II) to take such action as is
necessary to prevent the violation or
threatened violation; and
``(III) to prevent, as the
Commission determines to be
appropriate--
``(aa) significant harm to
covered entities or market
participants;
``(bb) significant harm to
the public interest; and
``(cc) frustration of the
ability of the Commission to
conduct the proceedings or to
redress the violation at the
conclusion of the proceedings.
``(ii) Timing of entry.--An order issued
under clause (i) shall be entered only after
notice and opportunity for a hearing, unless
the Commission determines that notice and
hearing before entry would be impracticable or
contrary to the public interest.
``(iii) Effective date.--A temporary order
issued under clause (i) shall--
``(I) become effective upon service
upon the entity; and
``(II) unless set aside, limited,
or suspended by the Commission or a
court of competent jurisdiction, remain
effective and enforceable pending the
completion of the proceedings.
``(D) Proceedings regarding dissipation or
conversion of assets.--
``(i) In general.--In a proceeding
involving an alleged violation of a regulation
or order promulgated or issued by the
Commission, if the Commission determines that
the alleged violation or related circumstances
are likely to result in significant dissipation
or conversion of assets, the Commission may
issue a temporary order requiring the
respondent to take such action as is necessary
to prevent the dissipation or conversion of
assets.
``(ii) Timing of entry.--An order issued
under clause (i) shall be entered only after
notice and opportunity for a hearing, unless
the Commission determines that notice and
hearing before entry would be impracticable or
contrary to the public interest.
``(iii) Effective date.--A temporary order
issued under clause (i) shall--
``(I) become effective upon service
upon the respondent; and
``(II) unless set aside, limited,
or suspended by the Commission or a
court of competent jurisdiction, remain
effective and enforceable pending the
completion of the proceedings.
``(E) Review of temporary orders.--
``(i) Application for review.--At any time
after a respondent has been served with a
temporary cease-and-desist order pursuant to
subparagraph (C) or order regarding the
dissipation or conversion of assets pursuant to
subparagraph (D), the respondent may apply to
the Commission to have the order set aside,
limited, or suspended.
``(ii) No prior hearing.--If a respondent
has been served with a temporary order entered
without a prior hearing of the Commission--
``(I) the respondent may, not later
than 10 days after the date on which
the order was served, request a hearing
on the application; and
``(II) the Commission shall hold a
hearing and render a decision on the
application at the earliest practicable
time.
``(iii) Judicial review.--
``(I) In general.--An entity shall
not be required to submit a request for
rehearing of a temporary order before
seeking judicial review in accordance
with this subparagraph.
``(II) Timing of review.--Not later
than 10 days after the date on which a
respondent is served with a temporary
cease-and-desist order entered with a
prior hearing of the Commission, or 10
days after the date on which the
Commission renders a decision on an
application and hearing under clause
(i) with respect to any temporary order
entered without such a prior hearing--
``(aa) the respondent may
obtain a review of the order in
a United States circuit court
having jurisdiction over the
circuit in which the respondent
resides or has a principal
place of business, or in the
United States Court of Appeals
for the District of Columbia
Circuit, for an order setting
aside, limiting, or suspending
the effectiveness or
enforcement of the order; and
``(bb) the court shall have
jurisdiction to enter such an
order.
``(III) No prior hearing.--A
respondent served with a temporary
order entered without a prior hearing
of the Commission may not apply to the
applicable court described in subclause
(II) except after a hearing and
decision by the Commission on the
application of the respondent under
clauses (i) and (ii).
``(iv) Procedures.--Section 222 and Part
III shall apply to--
``(I) an application for review of
an order under clause (i); and
``(II) an order subject to review
under clause (iii).
``(v) No automatic stay of temporary
order.--The commencement of proceedings under
clause (iii) shall not, unless specifically
ordered by the court, operate as a stay of the
order of the Commission.
``(F) Actions to collect civil penalties.--If any
person fails to pay a civil penalty assessed under this
subsection after an order assessing the penalty has
become final and unappealable, the Commission shall
bring an action to recover the amount of the penalty in
any appropriate United States district court.
``(4) Transaction fees.--
``(A) In general.--The Commission shall, in
accordance with this paragraph, establish and collect
transaction fees designed to recover the costs to the
Federal Government of the supervision and regulation of
regulated allowance markets and market participants,
including related costs for enforcement activities,
policy and rulemaking activities, administration, legal
services, and international regulatory activities.
``(B) Initial fee rate.--Each trading facility on
or through which regulated allowances are transacted
shall pay to the Commission a fee at a rate of not more
than $15 per $1,000,000 of the aggregate dollar amount
of sales of regulated allowances transacted through the
facility.
``(C) Annual adjustment of fee rate.--The
Commission shall, on an annual basis--
``(i) assess the rate at which fees are to
be collected as necessary to meet the cost
recovery requirement in subparagraph (A); and
``(ii) consistent with subparagraph (B),
adjust the rate as necessary in order to meet
the requirement.
``(D) Report on adequacy of fees in recovering
costs.--The Commission, shall, on an annual basis,
report to the Committee on Energy and Commerce of the
House of Representatives and the Committee on Energy
and Natural Resources of the Senate on the adequacy of
the transaction fees in providing funding for the
Commission to regulate the regulated allowance markets.
``(5) Judicial review.--Judicial review of actions taken by
the Commission under this subsection shall be pursuant to part
III.
``(6) Additional employees report and appointment.--Within
18 months after the date of the enactment of this section, the
Commission shall submit to the President, the Committee on
Energy and Commerce of the House of Representatives, and the
Committee on Energy and Natural Resources of the Senate, a
report that contains recommendations as to how many additional
employees would be necessary to provide robust oversight and
enforcement of the regulations promulgated under this
subsection. As soon as practicable after the completion of the
report, subject to appropriations, the Commission shall appoint
the recommended number of additional employees for such
purposes.
``(c) Working Group.--
``(1) Establishment.--Not later than 30 days after the date
of the enactment of this section, the President shall establish
an interagency working group on carbon market oversight, which
shall include the Administrator of the Environmental Protection
Agency and representatives of other relevant agencies, to make
recommendations to the Commodity Futures Trading Commission
regarding proposed regulations for the establishment,
operation, and oversight of markets for regulated allowance
derivatives.
``(2) Report.--Not later than 180 days after the date of
the enactment of this section, and biennially thereafter, the
interagency working group shall submit a written report to the
President and Congress that includes its recommendations to the
Commodity Futures Trading Commission regarding proposed
regulations for the establishment, operation, and oversight of
markets for regulated allowance derivatives and any
recommendations to Congress for statutory changes needed to
ensure the establishment, operation, and oversight of
transparent, fair, stable, and efficient markets for regulated
allowance derivatives.
``(d) Penalty for Fraud and False or Misleading Statements.--A
person convicted under section 1041 of title 18, United States Code,
may be prohibited from holding or trading regulated allowances for a
period of not more than 5 years pursuant to the regulations promulgated
under this section, except that, if the person is a covered entity, the
person shall be allowed to hold sufficient regulated allowances to meet
its compliance obligations.
``(e) Relation to State Law.--Nothing in this section shall
preclude, diminish or qualify any authority of a State or political
subdivision thereof to adopt or enforce any unfair competition,
antitrust, consumer protection, securities, commodities or any other
law or regulation, except that no such State law or regulation may
relieve any person of any requirement otherwise applicable under this
section.
``(f) Market Reports.--
``(1) Collection and analysis of information.--The
Commission, in conjunction with the Commodity Futures Trading
Commission, shall, on a continuous basis, analyze the following
information on the functioning of the markets for regulated
instruments established under this part:
``(A) The status of, and trends in, the markets,
including prices, trading volumes, transaction types,
and trading channels and mechanisms.
``(B) Spikes, collapses, and volatility in prices
of regulated instruments, and the causes therefor.
``(C) The relationship between the market for
regulated allowances and allowance derivatives, and the
spot and futures markets for energy commodities,
including electricity.
``(D) The economic effects of the markets,
including to macro- and micro-economic effects of
unexpected significant increases and decreases in the
price of regulated instruments.
``(E) Any changes in the roles, activities, or
strategies of various market participants.
``(F) Regional, industrial, and consumer responses
to the markets, and energy investment responses to the
markets.
``(G) Any other issue related to the markets that
the Commission, and the Commodity Futures Trading
Commission deem appropriate.
``(2) Annual reports to the congress.--Not later than 1
month after the end of each calendar year, the Commission, in
conjunction with the Commodity Futures Trading Commission,
shall submit to the President, the Committee on Agriculture and
Committee on Energy and Commerce of the House of
Representatives, and the Committee on Agriculture, Nutrition,
and Forestry and Committee on Energy and Natural Resources of
the Senate, and make available to the public, a report on the
matters described in paragraph (1) with respect to the year,
including recommendations for any administrative or statutory
measures the Commission and the Commodity Futures Trading
Commission consider necessary to address any threats to the
transparency, fairness, or integrity of the markets in
regulated instruments.
``SEC. 402. APPLICABILITY OF PART III PROVISIONS.
``(a) Sections 301, 304, and 306.--Sections 301, 304, and 306 shall
not apply to this part.
``(b) Section 315.--In applying section 315(a) to this part, the
words `person or entity' shall be substituted for the words `licensee
or public utility'. In applying section 315(b) to this part, the words
`an entity' shall be substituted for the words `a licensee or public
utility' and the words `such entity' shall be substituted for the words
`such licensee or public utility'.
``(c) Section 316.--Section 316(a) shall not apply to section
401(d).''.
(b) Criminal Prohibition Against Fraud and False or Misleading
Statements.--
(1) Chapter 47 of title 18, United States Code, is amended
by adding at the end the following:
``Sec. 1041. Fraud and false statements in connection with regulated
allowances
``Whoever in connection with a transaction involving a regulated
allowance (as defined in section 401(a) of the Federal Power Act, as
added by section 341 of the American Clean Energy and Security Act of
2009), knowingly--
``(1) makes or uses a materially false or misleading
statement, writing, representation, scheme, or device; or
``(2) falsifies, conceals, or covers up by any trick,
scheme, or device any material fact,
shall be fined not more than $5,000,000 (or $25,000,000 in the case of
an organization) or imprisoned not more than 20 years, or both.''.
(2) The table of sections at the beginning of chapter 47 of
title 18, United States Code, is amended by adding at the end
the following new item:
``1041. Fraud and false statements in connection with regulated
allowances.''.
SEC. 342. CARBON DERIVATIVE MARKETS.
(a) Section 1a(14) of the Commodity Exchange Act (7 U.S.C. 1a(14))
is amended by striking ``or an agricultural commodity'' and inserting
``, an agricultural commodity, or any emission allowance, compensatory
allowance, offset credit, or Federal renewable electricity credit
established or issued under the American Clean Energy and Security Act
of 2009''.
(b) Section 4(c) of such Act (7 U.S.C. 6(c)) is amended by adding
at the end the following:
``(6) This subsection does not apply to any agreement,
contract, or transaction for any emission allowance,
compensatory allowance, offset credit, or Federal renewable
electricity credit established or issued under the American
Clean Energy and Security Act of 2009.''.
Subtitle E--Additional Market Assurance
SEC. 351. REGULATION OF CERTAIN TRANSACTIONS IN DERIVATIVES INVOLVING
ENERGY COMMODITIES.
(a) Energy Commodity Defined.--Section 1a of the Commodity Exchange
Act (7 U.S.C. 1a) is amended--
(1) in paragraph (14), by inserting ``, an energy
commodity,'' after ``excluded commodity'';
(2) by redesignating paragraphs (13) through (21) and
paragraphs (22) through (34) as paragraphs (14) through (22)
and paragraphs (24) through (36), respectively;
(3) by inserting after paragraph (12) the following:
``(13) Energy commodity.--The term `energy commodity'
means--
``(A) coal;
``(B) crude oil, gasoline, diesel fuel, jet fuel,
heating oil, and propane;
``(C) electricity (excluding financial transmission
rights which are subject to regulation and oversight by
the Federal Energy Regulatory Commission);
``(D) natural gas; and
``(E) any other substance (other than an excluded
commodity, a metal, or an agricultural commodity) that
is used as a source of energy, as the Commission, in
its discretion, deems appropriate.''; and
(4) by inserting after paragraph (22) (as so redesignated
by paragraph (2) of this subsection) the following:
``(23) Included energy transaction.--The term `included
energy transaction' means a contract, agreement, or transaction
in an energy commodity for future delivery that provides for a
delivery point of the energy commodity in the United States or
a territory or possession of the United States, or that is
offered or transacted on or through a computer terminal located
in the United States.''.
(b) Extension of Regulatory Authority to Swaps Involving Energy
Transactions.--Section 2(g) of such Act (7 U.S.C. 2(g)) is amended by
inserting ``or an energy commodity'' after ``agricultural commodity''.
(c) Elimination of Exemption for Over-the-counter Swaps Involving
Energy Commodities.--Section 2(h)(1) of such Act (7 U.S.C. 2(h)(1)) is
amended by inserting ``(other than an energy commodity)'' after
``exempt commodity''.
(d) Extension of Regulatory Authority to Included Energy
Transactions on Foreign Boards of Trade.--Section 4 of such Act (7
U.S.C. 6) is amended--
(1) in subsection (a), by inserting ``, and which is not an
included energy transaction'' after ``territories or
possessions'' the 2nd place it appears; and
(2) in subsection (b), by adding at the end the following:
``The preceding sentence shall not apply with respect to
included energy transactions.''.
(e) Limitation of General Exemptive Authority of the CFTC With
Respect to Included Energy Transactions.--
(1) In general.--Section 4(c) of such Act (7 U.S.C. 6(c))
is amended by adding at the end the following:
``(6) The Commission may not exempt any included energy transaction
from the requirements of subsection (a), unless the Commission provides
60 days advance notice to the Congress and the Position Limit Energy
Advisory Group and solicits public comment about the exemption request
and any proposed Commission action.''.
(2) Nullification of no-action letter exemptions to certain
requirements applicable to included energy transactions.--
Beginning 180 days after the date of the enactment of this Act,
any exemption provided by the Commodity Futures Trading
Commission that has allowed included energy transactions (as
defined in section 1a(13) of the Commodity Exchange Act) to be
conducted without regard to the requirements of section 4(a) of
such Act shall be null and void.
(f) Requirement to Establish Uniform Speculative Position Limits
for Energy Transactions.--
(1) In general.--Section 4a(a) of such Act (7 U.S.C. 6a(a))
is amended--
(A) by inserting ``(1)'' after ``(a)'';
(B) by inserting after the 2nd sentence the
following: ``With respect to energy transactions, the
Commission shall fix limits on the aggregate number of
positions which may be held by any person for each
month across all markets subject to the jurisdiction of
the Commission.'';
(C) in the 4th sentence by inserting ``, consistent
with the 3rd sentence,'' after ``Commission''; and
(D) by adding after and below the end the
following:
``(2)(A) Not later than 60 days after the date of the enactment of
this paragraph, the Commission shall convene a Position Limit Energy
Advisory Group consisting of representatives from--
``(i) 7 predominantly commercial short hedgers of the
actual energy commodity for future delivery;
``(ii) 7 predominantly commercial long hedgers of the
actual energy commodity for future delivery;
``(iii) 4 non-commercial participants in markets for energy
commodities for future delivery; and
``(iv) each designated contract market or derivatives
transaction execution facility upon which a contract in the
energy commodity for future delivery is traded, and each
electronic trading facility that has a significant price
discovery contract in the energy commodity.
``(B) Not later than 60 days after the date on which the advisory
group is convened under subparagraph (A), and annually thereafter, the
advisory group shall submit to the Commission advisory recommendations
regarding the position limits to be established in paragraph (1).
``(C) The Commission shall have exclusive authority to grant
exemptions for bona fide hedging transactions and positions from
position limits imposed under this Act on energy transactions.''.
(2) Conforming amendments.--
(A) Significant price discovery contracts.--Section
2(h)(7) of such Act (7 U.S.C. 2(h)(7)) is amended--
(i) in subparagraph (A)--
(I) by inserting ``of this
paragraph and section 4a(a)'' after
``(B) through (D)''; and
(II) by inserting ``of this
paragraph'' before the period; and
(ii) in subparagraph (C)(ii)(IV)--
(I) in the heading, by striking
``limitations or''; and
(II) by striking ``position
limitations or''.
(B) Contracts traded on or through designated
contract markets.--Section 5(d)(5) of such Act (7
U.S.C. 7(d)(5)) is amended--
(i) in the heading by striking
``limitations or''; and
(ii) by striking ``position limitations
or''.
(C) Contracts traded on or through derivatives
transaction execution facilities.--Section 5a(d)(4) of
such Act (7 U.S.C. 7a(d)(4)) is amended--
(i) in the heading by striking
``limitations or''; and
(ii) by striking ``position limits or''.
(g) Elimination of the Swaps Loophole.--Section 4a(c) of such Act
(7 U.S.C. 6a(c)) is amended--
(1) by inserting ``(1)'' after ``(c)''; and
(2) by adding after and below the end the following:
``(2) For the purposes of contracts of sale for future delivery and
options on such contracts or commodities, the Commission shall define
what constitutes a bona fide hedging transaction or position as a
transaction or position that--
``(A)(i) represents a substitute for transactions made or
to be made or positions taken or to be taken at a later time in
a physical marketing channel;
``(ii) is economically appropriate to the reduction of
risks in the conduct and management of a commercial enterprise;
and
``(iii) arises from the potential change in the value of--
``(I) assets that a person owns, produces,
manufactures, processes, or merchandises or anticipates
owning, producing, manufacturing, processing, or
merchandising;
``(II) liabilities that a person owns or
anticipates incurring; or
``(III) services that a person provides, purchases,
or anticipates providing or purchasing; or
``(B) reduces risks attendant to a position resulting from
a transaction that--
``(i) was executed pursuant to subsection (d), (g),
(h)(1), or (h)(2) of section 2, or an exemption issued
by the Commission by rule, regulation or order; and
``(ii) was executed opposite a counterparty for
which the transaction would qualify as a bona fide
hedging transaction pursuant to paragraph (2)(A) of
this subsection.''.
(h) Detailed Reporting and Disaggregation of Market Data.--Section
4 of such Act (7 U.S.C. 6) is amended by adding at the end the
following:
``(e) Detailed Reporting and Disaggregation of Market Data.--
``(1) Index traders and swap dealers reporting.--The
Commission shall issue a proposed rule defining and classifying
index traders and swap dealers (as those terms are defined by
the Commission) for purposes of data reporting requirements and
setting routine detailed reporting requirements for any
positions of such entities in contracts traded on designated
contract markets, over-the-counter markets, derivatives
transaction execution facilities, foreign boards of trade
subject to section 4(f), and electronic trading facilities with
respect to significant price discovery contracts not later than
120 days after the date of the enactment of this subsection,
and issue a final rule within 180 days after such date of
enactment.
``(2) Disaggregation of index funds and other data in
markets.--Subject to section 8 and beginning within 60 days of
the issuance of the final rule required by paragraph (1), the
Commission shall disaggregate and make public weekly--
``(A) the number of positions and total notional
value of index funds and other passive, long-only and
short-only positions (as defined by the Commission) in
all markets to the extent such information is
available; and
``(B) data on speculative positions relative to
bona fide physical hedgers in those markets to the
extent such information is available.
``(3) Disclosure of identity of holders of positions in
indexes in excess of position limits.--The Commission shall
include in its weekly Commitment of Trader reports the identity
of each person who holds a position in an index in excess of a
limit imposed under section 4i.''.
(i) Authority to Set Limits to Prevent Excessive Speculation in
Indexes.--
(1) In general.--Section 4a of such Act (7 U.S.C. 6a) is
amended by adding at the end the following:
``(f) The provisions of this section shall apply to the amounts of
trading which may be done or positions which may be held by any person
under contracts of sale of an index for future delivery on or subject
to the rules of any contract market, derivatives transaction execution
facility, or over-the-counter market, or on an electronic trading
facility with respect to a significant price discovery contract, in the
same manner in which this section applies to contracts of sale of a
commodity for future delivery.''.
(2) Regulations.--The Commodity Futures Trading Commission
shall issue regulations under section 4a(f) of the Commodity
Exchange Act within 180 days after the date of the enactment of
this Act.
SEC. 352. NO EFFECT ON AUTHORITY OF THE FEDERAL ENERGY REGULATORY
COMMISSION.
Section 2 of the Commodity Exchange Act (7 U.S.C. 2) is amended by
adding at the end the following:
``(j) This Act shall not be interpreted to affect the jurisdiction
of the Federal Energy Regulatory Commission with respect to the
authority of the Federal Energy Regulatory Commission under the Federal
Power Act (16 U.S.C. 791a et seq.), the Natural Gas Act (15 U.S.C. 717
et seq.), or other law to obtain information, carry out enforcement
actions, or otherwise carry out the responsibilities of the Federal
Energy Regulatory Commission.''.
SEC. 353. INSPECTOR GENERAL OF THE COMMODITY FUTURES TRADING
COMMISSION.
(a) Elevation of Office.--
(1) Inclusion of cftc in definition of establishment.--
(A) Section 12(1) of the Inspector General Act of
1978 (5 U.S.C. App.) is amended by striking ``or the
Federal Cochairpersons of the Commissions established
under section 15301 of title 40, United States Code;''
and inserting ``the Federal Cochairpersons of the
Commissions established under section 15301 of title
40, United States Code; or the Chairman of the
Commodity Futures Trading Commission;''.
(B) Section 12(2) of the Inspector General Act of
1978 (5 U.S.C. App.) is amended by striking ``or the
Commissions established under section 15301 of title
40, United States Code,'' and inserting ``the
Commissions established under section 15301 of title
40, United States Code, or the Commodity Futures
Trading Commission,''.
(2) Exclusion of cftc from definition of designated federal
entity.--Section 8G(a)(2) of the Inspector General Act of 1978
(5 U.S.C. App.) is amended by striking ``the Commodity Futures
Trading Commission,''.
(b) Provisions Relating to Pay and Personnel Authority.--
(1) Provision relating to the position of inspector general
of the cftc.--In the case of the Inspector General of the
Commodities Futures Trading Commission, subsections (b) and (c)
of section 4 of the Inspector General Reform Act of 2008
(Public Law 110-409) shall apply in the same manner as if the
Commission was a designated Federal entity under section 8G.
The Inspector General of the Commodities Futures Trading
Commission shall not be subject to section 3(e) of such Act.
(2) Provision relating to other personnel.--Notwithstanding
paragraphs (7) and (8) of section 6(a) of the Inspector General
Act of 1978 (5 U.S.C. App.), the Inspector General of the
Commodities Futures Trading Commission may select, appoint, and
employ such officers and employees as may be necessary for
carrying out the functions, powers, and duties of the Office of
Inspector General and to obtain the temporary or intermittent
services of experts or consultants or an organization of
experts or consultants, subject to the applicable laws and
regulations that govern such selections, appointments, and
employment, and the obtaining of such services, within the
Commodities Futures Trading Commission.
(c) Effective Date; Transition Rule.--
(1) Effective date.--The amendments made by this section
shall take effect 30 days after the date of the enactment of
this Act.
(2) Transition rule.--An individual serving as Inspector
General of the Commodity Futures Trading Commission on the
effective date of this section pursuant to an appointment made
under section 8G of the Inspector General Act of 1978 (5 U.S.C.
App.)--
(A) may continue so serving until the President
makes an appointment under section 3(a) of such Act
consistent with the amendments made by this section;
and
(B) shall, while serving under subparagraph (A),
remain subject to the provisions of section 8G of such
Act which apply with respect to the Commodity Futures
Trading Commission.
SEC. 354. SETTLEMENT AND CLEARING THROUGH REGISTERED DERIVATIVES
CLEARING ORGANIZATIONS.
(a) In General.--
(1) Application to excluded derivative transactions.--
(A) Section 2(d)(1) of the Commodity Exchange Act
(7 U.S.C. 2(d)(1)) is amended--
(i) by striking ``and'' at the end of
subparagraph (A);
(ii) by striking the period at the end of
subparagraph (B) and inserting ``; and''; and
(iii) by adding at the end the following:
``(C) except as provided in section 4(f), the
agreement, contract, or transaction is settled and
cleared through a derivatives clearing organization
registered with the Commission.''.
(B) Section 2(d)(2) of such Act (7 U.S.C. 2(d)(2))
is amended--
(i) by striking ``and'' at the end of
subparagraph (B);
(ii) by striking the period at the end of
subparagraph (C) and inserting ``; and''; and
(iii) by adding at the end the following:
``(D) except as provided in section 4(f), the
agreement, contract, or transaction is settled and
cleared through a derivatives clearing organization
registered with the Commission.''.
(2) Application to certain swap transactions.--Section 2(g)
of such Act (7 U.S.C. 2(g)) is amended--
(A) by striking ``and'' at the end of paragraph
(2);
(B) by striking the period at the end of paragraph
(3) and inserting ``; and''; and
(C) by adding at the end the following:
``(4) except as provided in section 4(f), settled and
cleared through a derivatives clearing organization registered
with the Commission.''.
(3) Application to certain transactions in exempt
commodities.--
(A) Section 2(h)(1) of such Act ( 7 U.S.C. 2(h)(1))
is amended--
(i) by striking ``and'' at the end of
subparagraph (A);
(ii) by striking the period at the end of
subparagraph (B) and inserting ``; and''; and
(iii) by adding at the end the following:
``(C) except as provided in section 4(f), is
settled and cleared through a derivatives clearing
organization registered with the Commission.''.
(B) Section 2(h)(3) of such Act (7 U.S.C. 2(h)(3))
is amended--
(i) by striking ``and'' at the end of
subparagraph (A);
(ii) by striking the period at the end of
subparagraph (B) and inserting ``; and''; and
(iii) by adding at the end the following:
``(C) except as provided in section 4(f), settled
and cleared through a derivatives clearing organization
registered with the Commission.''.
(4) General exemptive authority.--Section 4(c)(1) of such
Act (7 U.S.C. 6(c)(1)) is amended by inserting ``the agreement,
contract, or transaction, except as provided in section 4(h),
will be settled and cleared through a derivatives clearing
organization registered with the Commission and'' before ``the
Commission determines''.
(5) Conforming amendment relating to significant price
discovery contracts.--Section 2(h)(7)(D) of such Act (7 U.S.C.
2(h)(7)(D)) is amended by striking the designation and heading
for the subparagraph and all that follows through ``As part
of'' and inserting the following:
``(D) Review of implementation.--As part of''.
(b) Alternatives to Clearing Through Designated Clearing
Organizations.--Section 4 of such Act (7 U.S.C. 6), as amended by
section 351(h) of this Act, is amended by adding at the end the
following:
``(f) Alternatives to Clearing Through Designated Clearing
Organizations.--
``(1) Settlement and clearing through certain other
regulated entities.--An agreement, contract, or transaction, or
class thereof, relating to an excluded commodity, that would
otherwise be required to be settled and cleared by section
2(d)(1)(C), 2(d)(2)(D), 2(g)(4), 2(h)(1)(C), or 2(h)(3)(C) of
this Act, or subsection (c)(1) of this section may be settled
and cleared through an entity listed in subsections (a) or (b)
of section 409 of the Federal Deposit Insurance Corporation
Improvement Act of 1991.
``(2) Waiver of clearing requirement.--
``(A) The Commission, in its discretion, may exempt
an agreement, contract, or transaction, or class
thereof, that would otherwise be required by section
2(d)(1)(C), 2(d)(2)(D), 2(g)(4), 2(h)(1)(C), or
2(h)(3)(C) of this Act, or subsection (c)(1) of this
section to be settled and cleared through a derivatives
clearing organization registered with the Commission
from such requirement.
``(B) In granting exemptions pursuant to
subparagraph (A), the Commission shall consult with the
Securities and Exchange Commission and the Board of
Governors of the Federal Reserve System regarding
exemptions that relate to excluded commodities or
entities for which the Securities Exchange Commission
or the Board of Governors of the Federal Reserve System
serve as the primary regulator.
``(C) Before granting an exemption pursuant to
subparagraph (A), the Commission shall find that the
agreement, contract, or transaction, or class thereof--
``(i) is highly customized as to its
material terms and conditions;
``(ii) is transacted infrequently;
``(iii) does not serve a significant price-
discovery function in the marketplace; and
``(iv) is being entered into by parties who
can demonstrate the financial integrity of the
agreement, contract, or transaction and their
own financial integrity, as such terms and
standards are determined by the Commission. The
standards may include, with respect to any
federally regulated financial entity for which
net capital requirements are imposed, a net
capital requirement associated with any
agreement, contract, or transaction subject to
an exemption from the clearing requirement that
is higher than the net capital requirement that
would be associated with such a transaction
were it cleared.
``(D) Any agreement, contract, or transaction, or
class thereof, which is exempted pursuant to
subparagraph (A) shall be reported to the Commission in
a manner designated by the Commission, or to such other
entity the Commission deems appropriate.
``(E) The Commission, the Securities and Exchange
Commission and the Board of Governors of the Federal
Reserve System shall enter into a memorandum of
understanding by which the information reported to the
Commission pursuant to subparagraph (D) with regard to
excluded commodities or entities for which the
Securities Exchange Commission or the Board of
Governors of the Federal Reserve System serve as the
primary regulator may be provided to the other
agencies.
``(g) Spot and Forward Exclusion.--The settlement and clearing
requirements of section 2(d)(1)(C), 2(d)(2)(D), 2(g)(4), 2(h)(1)(C),
2(h)(3)(C), or 4(c)(1) shall not apply to an agreement, contract, or
transaction of any cash commodity for immediate or deferred shipment or
delivery, as defined by the Commission.''.
(c) Additional Requirements Applicable to Applicants for
Registration as a Derivative Clearing Organization.--Section 5b(c)(2)
of such Act (7 U.S.C. 7a-1(c)(2)) is amended by adding at the end the
following:
``(O) Disclosure of general information.--The
applicant shall disclose publicly and to the Commission
information concerning--
``(i) the terms and conditions of
contracts, agreements, and transactions cleared
and settled by the applicant;
``(ii) the conventions, mechanisms, and
practices applicable to the contracts,
agreements, and transactions;
``(iii) the margin-setting methodology and
the size and composition of the financial
resource package of the applicant; and
``(iv) other information relevant to
participation in the settlement and clearing
activities of the applicant.
``(P) Daily publication of trading information.--
The applicant shall make public daily information on
settlement prices, volume, and open interest for
contracts settled or cleared pursuant to the
requirements of section 2(d)(1)(C), 2(d)(2)(D),
2(g)(4), 2(h)(1)(C), 2(h)(3)(C) or 4(c)(1) of this Act
by the applicant if the Commission determines that the
contracts perform a significant price discovery
function for transactions in the cash market for the
commodity underlying the contracts.
``(Q) Fitness standards.--The applicant shall
establish and enforce appropriate fitness standards for
directors, members of any disciplinary committee, and
members of the applicant, and any other persons with
direct access to the settlement or clearing activities
of the applicant, including any parties affiliated with
any of the persons described in this subparagraph.''.
(d) Amendments.--
(1) Section 409 of the Federal Deposit Insurance
Corporation Improvement Act of 1991 (12 U.S.C. 4422) is amended
by adding at the end the following:
``(c) Clearing Requirement.--A multilateral clearing organization
described in subsections (a) or (b) of this section shall comply with
requirements similar to the requirements of sections 5b and 5c of the
Commodity Exchange Act.''.
(2) Section 407 of the Legal Certainty for Bank Products
Act of 2000 (7 U.S.C. 27e) is amended by inserting ``and the
settlement and clearing requirements of sections 2(d)(1)(C),
2(d)(2)(D), 2(g)(4), 2(h)(1)(C), 2(h)(3)(C), and 4(c)(1) of
such Act'' after ``the clearing of covered swap agreements''.
(e) Effective Date.--The amendments made by this section shall take
effect 150 days after the date of the enactment of this Act.
(f) Transition Rule.--Any agreement, contract, or transaction
entered into before the date of the enactment of this Act or within 150
days after such date of enactment, in reliance on subsection (d), (g),
(h)(1), or (h)(3) of section 2 of the Commodity Exchange Act or any
other exemption issued by the Commission Futures Trading Commission by
rule, regulation, or order shall, within 90 days after such date of
enactment, unless settled and cleared through an entity registered with
the Commission as a derivatives clearing organization or another
clearing entity pursuant to section 4(f) of such Act, be reported to
the Commission in a manner designated by the Commission, or to such
other entity as the Commission deems appropriate.
SEC. 355. LIMITATION ON ELIGIBILITY TO PURCHASE A CREDIT DEFAULT SWAP.
(a) In General.--Section 4c of the Commodity Exchange Act (7 U.S.C.
6c) is amended by adding at the end the following:
``(h) Limitation on Eligibility to Purchase a Credit Default
Swap.--It shall be unlawful for any person to enter into a credit
default swap unless the person--
``(1) owns a credit instrument which is insured by the
credit default swap;
``(2) would experience financial loss if an event that is
the subject of the credit default swap occurs with respect to
the credit instrument; and
``(3) meets such minimum capital adequacy standards as may
be established by the Commission, in consultation with the
Board of Governors of the Federal Reserve System, or such more
stringent minimum capital adequacy standards as may be
established by or under the law of any State in which the swap
is originated or entered into, or in which possession of the
contract involved takes place.''.
(b) Elimination of Preemption of State Bucketing Laws Regarding
Naked Credit Default Swaps.--Section 12(e)(2)(B) of such Act (7 U.S.C.
16(e)(2)(B)) is amended by inserting ``(other than a credit default
swap in which the purchaser of the swap would not experience financial
loss if an event that is the subject of the swap occurred)'' before
``that is excluded''.
(c) Definition of Credit Default Swap.--Section 1a of such Act (7
U.S.C. 1a), as amended by section 351(a) of this Act, is amended by
adding at the end the following:
``(37) Credit default swap.--The term `credit default swap'
means a contract which insures a party to the contract against
the risk that an entity may experience a loss of value as a
result of an event specified in the contract, such as a default
or credit downgrade. A credit default swap that is traded on or
cleared by a registered entity shall be excluded from the
definition of a security as defined in this Act and in section
2(a)(1) of the Securities Act of 1933 or section 3(a)(10) of
the Securities Exchange Act of 1934, except it shall be deemed
a security solely for purpose of enforcing prohibitions against
insider trading in sections 10 and 16 of the Securities
Exchange Act of 1934.''.
(d) Effective Date.--The amendments made by this section shall be
effective for credit default swaps (as defined in section 1a(37) of the
Commodity Exchange Act) entered into after 60 days after the date of
the enactment of this section.
SEC. 356. TRANSACTION FEES.
(a) In General.--Section 12 of the Commodity Exchange Act (7 U.S.C.
16) is amended by redesignating subsections (e), (f), and (g) as
subsections (f), (g), and (h), respectively, and inserting after
subsection (d) the following:
``(e) Clearing Fees.--
``(1) In general.--The Commission shall, in accordance with
this subsection, charge and collect from each registered
clearing organization, and each such organization shall pay to
the Commission, transaction fees at a rate calculated to
recover the costs to the Federal Government of the supervision
and regulation of futures markets, except those directly
related to enforcement.
``(2) Fees assessed per side of cleared contracts.--
``(A) In general.--The Commission shall determine
the fee rate referred to in paragraph (1), and shall
apply the fee rate per side of any transaction cleared.
``(B) Authority to delegate.--The Commission may
determine the procedures by which the fee rate is to be
applied on the transactions subject to the fee, or
delegate the authority to make the determination to any
appropriate derivatives clearing organization.
``(3) Exemptions.--The Commission may not impose a fee
under paragraph (1) on--
``(A) a class of contracts or transactions if the
Commission finds that it is in the public interest to
exempt the class from the fee; or
``(B) a contract or transaction cleared by a
registered derivatives clearing organization that is--
``(i) subject to fees under section 31 of
the Securities Exchange Act of 1934; or
``(ii) a security as defined in the
Securities Act of 1933 or the Securities
Exchange Act of 1934.
``(4) Dates for payment of fees.--The fees imposed under
paragraph (1) shall be paid on or before--
``(A) March 15 of each year, with respect to
transactions occurring on or after the preceding
September 1 and on or before the preceding December 31;
and
``(B) September 15 of each year, with respect to
transactions occurring on or after the preceding
January 1 and on or before the preceding August 31.
``(5) Annual adjustment of fee rates.--
``(A) In general.--Not later than April 30 of each
fiscal year , the Commission shall, by order, adjust
each fee rate determined under paragraph (2) for the
fiscal year to a uniform adjusted rate that, when
applied to the estimated aggregate number of cleared
sides of transactions for the fiscal year, is
reasonably likely to produce aggregate fee receipts
under this subsection for the fiscal year equal to the
target offsetting receipt amount for the fiscal year.
``(B) Definitions.--In subparagraph (A):
``(i) Estimated aggregate number of cleared
sides of transactions.--The term `estimated
aggregate number of cleared sides of
transactions' means, with respect to a fiscal
year, the aggregate number of cleared sides of
transactions to be cleared by registered
derivatives clearing organizations during the
fiscal year, as estimated by the Commission,
after consultation with the Office of
Management and Budget, using the methodology
required for making projections pursuant to
section 257 of the Balanced Budget and
Emergency Deficit Control Act of 1985.
``(ii) Target offsetting receipt amount.--
The term `target offsetting receipt amount'
means, with respect to a fiscal year, the total
level of Commission budget authority for all
non-enforcement activities of the Commission,
as contained in the regular appropriations Acts
for the fiscal year.
``(C) No judicial review.--An adjusted fee rate
prescribed under subparagraph (A) shall not be subject
to judicial review.
``(6) Publication.--Not later than April 30 of each fiscal
year, the Commission shall cause to be published in the Federal
Register notices of the fee rates applicable under this
subsection for the succeeding fiscal year, and any estimate or
projection on which the fee rates are based.
``(7) Establishment of futures and options transaction fee
account; deposit of fees.--There is established in the Treasury
of the United States an account which shall be known as the
`Futures and Options Transaction Fee Account'. All fees
collected under this subsection for a fiscal year shall be
deposited in the account. Amounts in the account are authorized
to be appropriated to fund the expenditures of the
Commission.''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to fiscal years beginning 30 or more days after the date of the
enactment of this Act.
(c) Transition Rule.--If this section becomes law after March 31
and before September 1 of a fiscal year, then paragraphs (5)(A) and (6)
of section 12(e) of the Commodity Exchange Act shall be applied, in the
case of the 1st fiscal year beginning after the date of the enactment
of this Act, by substituting ``August 31'' for ``April 30''.
SEC. 357. NO EFFECT ON ANTITRUST LAW OR AUTHORITY OF THE FEDERAL TRADE
COMMISSION.
(a) Nothing in this subtitle shall be construed to modify, impair,
or supersede the operation of any of the antitrust laws. For purposes
of this subsection, the term ``antitrust laws'' has the meaning given
it in subsection (a) of the 1st section of the Clayton Act (15 U.S.C.
12(a)), except that such term includes section 5 of the Federal Trade
Commission Act (15 U.S.C. 45) to the extent that such term applies to
unfair methods of competition.
(b) Nothing in this subtitle shall be construed to affect or
diminish the jurisdiction or authority of the Federal Trade Commission
with respect to its authorities under the Federal Trade Commission Act
(15 U.S.C. 41 et seq.) or the Energy Independence and Security Act of
2007 (Public Law 110-140) to obtain information, to carry out
enforcement activities, or otherwise to carry out the responsibilities
of the Federal Trade Commission.
SEC. 358. EFFECT OF DERIVATIVES REGULATORY REFORM LEGISLATION.
(a) Statutes.--Upon the passage of legislation that includes
derivatives regulatory reform, sections 351, 352, 354, 355, 356, and
357 shall be repealed.
(b) Regulations.--Upon the passage of legislation that includes
derivatives regulatory reform, any regulations promulgated under
section 351, 352, 354, 355, 356, or 357 shall be considered null and
void.
SEC. 359. CEASE-AND-DESIST AUTHORITY.
(a) Natural Gas Act.--Section 20 of the Natural Gas Act (15 U.S.C.
717s) is amended by adding the following at the end:
``(e) Cease-and-desist Proceedings; Temporary Orders; Authority of
the Commission.--
``(1) In general.--If the Commission finds, after notice
and opportunity for hearing, that any entity may be violating,
may have violated, or may be about to violate any provision of
this Act, or any rule, regulation, restriction, condition, or
order made or imposed by the Commission under the authority of
this Act, the Commission may publish its findings and issue an
order requiring such entity, and any other entity that is, was,
or would be a cause of the violation, due to an act or omission
the entity knew or should have known would contribute to such
violation, to cease and desist from committing or causing such
violation and any future violation of the same provision, rule,
or regulation. Such order may, in addition to requiring an
entity to cease and desist from committing or causing a
violation, require such entity to comply, to provide an
accounting and disgorgement, or to take steps to effect
compliance, with such provision, rule, or regulation, upon such
terms and conditions and within such time as the Commission may
specify in such order. Any such order may, as the Commission
deems appropriate, require future compliance or steps to effect
future compliance, either permanently or for such period of
time as the Commission may specify.
``(2) Timing of entry.--An order issued under this
subsection shall be entered only after notice and opportunity
for a hearing, unless the Commission determines that notice and
hearing prior to entry would be impracticable or contrary to
the public interest.
``(f) Hearing.--The notice instituting proceedings pursuant to
subsection (e) shall fix a hearing date not earlier than 30 days nor
later than 60 days after service of the notice unless an earlier or a
later date is set by the Commission with the consent of any respondent
so served.
``(g) Temporary Order.--Whenever the Commission determines that--
``(1) a respondent may take actions to dissipate or convert
assets prior to the completion of the proceedings referred to
in subsection (e), and such assets would be necessary to comply
with or otherwise satisfy a final enforcement order of the
Commission pursuant to alleged violations or threatened
violations specified in the notice instituting proceedings; or
``(2) a respondent is engaged in actual or threatened
violations of this Act or a Commission rule, regulation,
restriction or order referred to in subsection (e),
the Commission may issue a temporary order requiring the respondent to
take such action to prevent dissipation or conversion of assets,
significant harm to energy consumers, or substantial harm to the public
interest, frustration of the Commission's ability to conduct the
proceedings, or frustration of the Commission's ability to redress said
violation at the conclusion of the proceedings, as the Commission deems
appropriate pending completion of such proceedings.
``(h) Review of Temporary Orders.--
``(1) Commission review.--At any time after the respondent
has been served with a temporary cease-and-desist order
pursuant to subsection (g), the respondent may apply to the
Commission to have the order set aside, limited, or suspended.
If the respondent has been served with a temporary cease-and-
desist order entered without a prior Commission hearing, the
respondent may, within 10 days after the date on which the
order was served, request a hearing on such application and the
Commission shall hold a hearing and render a decision on such
application at the earliest possible time.
``(2) Judicial review.--Within--
``(A) 10 days after the date the respondent was
served with a temporary cease-and-desist order entered
with a prior Commission hearing; or
``(B) 10 days after the Commission renders a
decision on an application and hearing under paragraph
(1),
with respect to any temporary cease-and-desist order entered
without a prior Commission hearing, the respondent may apply to
the United States circuit court having jurisdiction over the
circuit in which the respondent resides or has its principal
place of business, or to the United States Court of Appeals for
the District of Columbia Circuit, for an order setting aside,
limiting, or suspending the effectiveness or enforcement of the
order, and the court shall have jurisdiction to enter such an
order. A respondent served with a temporary cease-and-desist
order entered without a prior Commission hearing may not apply
to the court except after hearing and decision by the
Commission on the respondent's application under paragraph (1)
of this subsection.
``(3) No automatic stay of temporary order.--The
commencement of proceedings under paragraph (2) of this
subsection shall not, unless specifically ordered by the court,
operate as a stay of the Commission's order.
``(4) Exclusive review.--Sections 19(d) and 24 shall not
apply to a temporary order entered pursuant to this section.
``(i) Implementation.--The Commission is authorized to adopt rules,
regulations, and orders as it deems appropriate to implement this
section.''.
(c) Natural Gas Policy Act of 1978.--Section 504 of the Natural Gas
Policy Act of 1978 (15 U.S.C. 3414) is amended by adding the following
at the end:
``(d) Cease-and-desist Proceedings; Temporary Orders; Authority of
the Commission.--
``(1) In general.--If the Commission finds, after notice
and opportunity for hearing, that any entity may be violating,
may have violated, or may be about to violate any provision of
this Act, or any rule, regulation, restriction, condition, or
order made or imposed by the Commission under the authority of
this Act, the Commission may publish its findings and issue an
order requiring such entity, and any other entity that is, was,
or would be a cause of the violation, due to an act or omission
the entity knew or should have known would contribute to such
violation, to cease and desist from committing or causing such
violation and any future violation of the same provision, rule,
or regulation. Such order may, in addition to requiring an
entity to cease and desist from committing or causing a
violation, require such entity to comply, to provide an
accounting and disgorgement, or to take steps to effect
compliance, with such provision, rule, or regulation, upon such
terms and conditions and within such time as the Commission may
specify in such order. Any such order may, as the Commission
deems appropriate, require future compliance or steps to effect
future compliance, either permanently or for such period of
time as the Commission may specify.
``(2) Timing of entry.--An order issued under this
subsection shall be entered only after notice and opportunity
for a hearing, unless the Commission determines that notice and
hearing prior to entry would be impracticable or contrary to
the public interest.
``(3) Hearing.--The notice instituting proceedings pursuant
to paragraph (1) shall fix a hearing date not earlier than 30
days nor later than 60 days after service of the notice unless
an earlier or a later date is set by the Commission with the
consent of any respondent so served.
``(4) Temporary order.--Whenever the Commission determines
that--
``(A) a respondent may take actions to dissipate or
convert assets prior to the completion of the
proceedings referred to in paragraph (1) and such
assets would be necessary to comply with or otherwise
satisfy a final enforcement order of the Commission
pursuant to alleged violations or threatened violations
specified in the notice instituting proceedings; or
``(B) a respondent is engaged in actual or
threatened violations of this Act or a Commission rule,
regulation, restriction or order referred to in
paragraph (1),
the Commission may issue a temporary order requiring the
respondent to take such action to prevent dissipation or
conversion of assets, significant harm to energy consumers, or
substantial harm to the public interest, frustration of the
Commission's ability to conduct the proceedings, or frustration
of the Commission's ability to redress said violation at the
conclusion of the proceedings, as the Commission deems
appropriate pending completion of such proceedings.
``(5) Review of temporary orders.--
``(A) Commission review.--At any time after the
respondent has been served with a temporary cease-and-
desist order pursuant to paragraph (4), the respondent
may apply to the Commission to have the order set
aside, limited, or suspended. If the respondent has
been served with a temporary cease-and-desist order
entered without a prior Commission hearing, the
respondent may, within 10 days after the date on which
the order was served, request a hearing on such
application and the Commission shall hold a hearing and
render a decision on such application at the earliest
possible time.
``(B) Judicial review.--Within--
``(i) 10 days after the date the respondent
was served with a temporary cease-and-desist
order entered with a prior Commission hearing;
or
``(ii) 10 days after the Commission renders
a decision on an application and hearing under
subparagraph (A), with respect to any temporary
cease-and-desist order entered without a prior
Commission hearing, the respondent may apply to
the United States circuit court having
jurisdiction over the circuit in which the
respondent resides or has its principal place
of business, or to the United States Court of
Appeals for the District of Columbia Circuit,
for an order setting aside, limiting, or
suspending the effectiveness or enforcement of
the order, and the court shall have
jurisdiction to enter such an order. A
respondent served with a temporary cease-and-
desist order entered without a prior Commission
hearing may not apply to the court except after
hearing and decision by the Commission on the
respondent's application under paragraph (1) of
this subsection.
``(C) No automatic stay of temporary order.--The
commencement of proceedings under subparagraph (B) of
this paragraph shall not, unless specifically ordered
by the court, operate as a stay of the Commission's
order.
``(6) Implementation.--The Commission is authorized to
adopt rules, regulations, and orders as it deems appropriate to
implement this subsection.''.
SEC. 360. PRESIDENTIAL REVIEW OF REGULATIONS.
Not later than 24 months after the date of enactment of this Act,
the President shall review the offset regulations and derivatives
regulations promulgated pursuant to the American Clean Energy and
Security Act of 2009. The President shall determine whether such
regulations adequately protect the United States financial system from
systemic risk.
TITLE IV--TRANSITIONING TO A CLEAN ENERGY ECONOMY
Subtitle A--Ensuring Real Reductions in Industrial Emissions
SEC. 401. ENSURING REAL REDUCTIONS IN INDUSTRIAL EMISSIONS.
Title VII of the Clean Air Act is amended by inserting after part E
the following new part:
``PART F--ENSURING REAL REDUCTIONS IN INDUSTRIAL EMISSIONS
``SEC. 761. PURPOSES.
``(a) Purposes of Part.--The purposes of this part are--
``(1) to promote a strong global effort to significantly
reduce greenhouse gas emissions, and, through this global
effort, stabilize greenhouse gas concentrations in the
atmosphere at a level that will prevent dangerous anthropogenic
interference with the climate system; and
``(2) to prevent an increase in greenhouse gas emissions in
countries other than the United States as a result of direct
and indirect compliance costs incurred under this title.
``(b) Purposes of Subpart 1.--The purposes of subpart 1 are
additionally--
``(1) to provide a rebate to the owners and operators of
entities in domestic eligible industrial sectors for their
greenhouse gas emission costs incurred under this title, but
not for costs associated with other related or unrelated market
dynamics;
``(2) to design such rebates in a way that will prevent
carbon leakage while also rewarding innovation and facility-
level investments in energy efficiency performance
improvements; and
``(3) to eliminate or reduce distribution of emission
allowances under subpart 1 when such distribution is no longer
necessary to prevent carbon leakage from eligible industrial
sectors.
``(c) Purposes of Subpart 2.--The purposes of subpart 2 are
additionally--
``(1) to induce foreign countries, and, in particular,
fast-growing developing countries, to take substantial action
with respect to their greenhouse gas emissions consistent with
the Bali Action Plan developed under the United Nations
Framework Convention on Climate Change; and
``(2) to ensure that the measures described in subpart 2
are designed and implemented in a manner consistent with
applicable international agreements to which the United States
is a party.
``SEC. 762. DEFINITIONS.
``In this part:
``(1) Carbon leakage.--The term `carbon leakage' means any
substantial increase (as determined by the Administrator) in
greenhouse gas emissions by industrial entities located in
other countries if such increase is caused by an incremental
cost of production increase in the United States resulting from
the implementation of this title.
``(2) Covered good.--The term `covered good' means a good
that, as identified by the Administrator by regulation, is
either--
``(A) entered under a heading or subheading of the
Harmonized Tariff Schedule of the United States that
corresponds to the NAICS code for an eligible
industrial sector, as established in the concordance
between NAICS codes and the Harmonized Tariff Schedule
of the United States prepared by the United States
Census Bureau; or
``(B) a manufactured item for consumption.
``(3) Eligible industrial sector.--The term `eligible
industrial sector' means an industrial sector determined by the
Administrator under section 763(b) to be eligible to receive
emission allowance rebates under subpart 1.
``(4) Industrial sector.--The term `industrial sector'
means any sector that is in the manufacturing sector (as
defined in NAICS codes 31, 32, and 33) or that beneficiates or
otherwise processes (including agglomeration) metal ores,
including iron and copper ores, soda ash, or phosphate. The
extraction of metal ores, soda ash, or phosphate shall not be
considered to be an industrial sector.
``(5) Manufactured item for consumption.--
``(A) In general.--The term `manufactured item for
consumption' means any good--
``(i) that includes in substantial amounts
one or more goods like the goods produced by an
eligible industrial sector;
``(ii) with respect to which an
international reserve allowance program
pursuant to subpart 2 is in effect with regard
to the eligible industrial sector and the
quantity of international reserve allowances is
not zero pursuant to section 768(b);
``(iii) with respect to which the trade
intensity of the industrial sector that
produces the good, as measured consistent with
section 763(b)(2)(A)(iii), is at least 15
percent; and
``(iv) for which the domestic producers of
the good have demonstrated, and the
Administrator has determined, that the
application of the international reserve
allowance program pursuant to subpart 2 is
technically and administratively feasible and
appropriate to achieve the purposes of this
part, taking into account the energy and
greenhouse gas intensity of the industrial
sector that produces the good, as measured
consistent with section 763(b)(2)(A)(ii), and
the ability of such producers to pass on cost
increases and other appropriate factors.
``(B) Rule of construction.--A determination of the
Administrator under subparagraph (A)(iv) shall not be
considered to be a determination of the President under
section 767(b).
``(6) NAICS.--The term `NAICS' means the North American
Industrial Classification System of 2002.
``(7) Output.--The term `output' means the total tonnage or
other standard unit of production (as determined by the
Administrator) produced by an entity in an industrial sector.
The output of the cement sector is hydraulic cement, and not
clinker.
``Subpart 1--Emission Allowance Rebate Program
``SEC. 763. ELIGIBLE INDUSTRIAL SECTORS.
``(a) List.--
``(1) Initial list.--Not later than June 30, 2011, the
Administrator shall publish in the Federal Register a list of
eligible industrial sectors pursuant to subsection (b). Such
list shall include the amount of the emission allowance rebate
per unit of production that shall be provided to entities in
each eligible industrial sector in the following two calendar
years pursuant to section 764.
``(2) Subsequent lists.--Not later than February 1, 2013,
and every 4 years thereafter, the Administrator shall publish
in the Federal Register an updated version of the list
published under paragraph (1).
``(b) Eligible Industrial Sectors.--
``(1) In general.--Not later than June 30, 2011, the
Administrator shall promulgate a rule designating, based on the
criteria under paragraph (2), the industrial sectors eligible
for emission allowance rebates under this subpart.
``(2) Presumptively eligible industrial sectors.--
``(A) Eligibility criteria.--
``(i) In general.--An owner or operator of
an entity shall be eligible to receive emission
allowance rebates under this subpart if such
entity is in an industrial sector that is
included in a six-digit classification of the
NAICS that meets the criteria in both clauses
(ii) and (iii), or the criteria in clause (iv).
``(ii) Energy or greenhouse gas
intensity.--As determined by the Administrator,
the industrial sector had--
``(I) an energy intensity of at
least 5 percent, calculated by dividing
the cost of purchased electricity and
fuel costs of the sector by the value
of the shipments of the sector, based
on data described in subparagraph (D);
or
``(II) a greenhouse gas intensity
of at least 5 percent, calculated by
dividing--
``(aa) the number 20
multiplied by the number of
tons of carbon dioxide
equivalent greenhouse gas
emissions (including direct
emissions from fuel combustion,
process emissions, and indirect
emissions from the generation
of electricity used to produce
the output of the sector) of
the sector based on data
described in subparagraph (D);
by
``(bb) the value of the
shipments of the sector, based
on data described in
subparagraph (D).
``(iii) Trade intensity.--As determined by
the Administrator, the industrial sector had a
trade intensity of at least 15 percent,
calculated by dividing the value of the total
imports and exports of such sector by the value
of the shipments plus the value of imports of
such sector, based on data described in
subparagraph (D).
``(iv) Very high energy or greenhouse gas
intensity.--As determined by the Administrator,
the industrial sector had an energy or
greenhouse gas intensity, as calculated under
clause (ii)(I) or (II), of at least 20 percent.
``(B) Metal and phosphate production classified
under more than one naics code.--For purposes of this
section, the Administrator shall--
``(i) aggregate data for the beneficiation
or other processing (including agglomeration)
of metal ores, including iron and copper ores,
soda ash, or phosphate with subsequent steps in
the process of metal and phosphate
manufacturing, regardless of the NAICS code
under which such activity is classified; and
``(ii) aggregate data for the manufacturing
of steel with the manufacturing of steel pipe
and tube made from purchased steel in a
nonintegrated process.
``(C) Exclusion.--The petroleum refining sector
shall not be an eligible industrial sector.
``(D) Data sources.--
``(i) Electricity and fuel costs, value of
shipments.--The Administrator shall determine
electricity and fuel costs and the value of
shipments under this subsection from data from
the United States Census Annual Survey of
Manufacturers. The Administrator shall take the
average of data from as many of the years of
2004, 2005, and 2006 for which such data are
available. If such data are unavailable, the
Administrator shall make a determination based
upon 2002 or 2006 data from the most detailed
industrial classification level of Energy
Information Agency's Manufacturing Energy
Consumption Survey (using 2006 data if it is
available) and the 2002 or 2007 Economic Census
of the United States (using 2007 data if it is
available). If data from the Manufacturing
Energy Consumption Survey or Economic Census
are unavailable for any sector at the six-digit
classification level in the NAICS, then the
Administrator may extrapolate the information
necessary to determine the eligibility of a
sector under this paragraph from available
Manufacturing Energy Consumption Survey or
Economic Census data pertaining to a broader
industrial category classified in the NAICS. If
data relating to the beneficiation or other
processing (including agglomeration) of metal
ores, including iron and copper ores, soda ash,
or phosphate are not available from the
specified data sources, the Administrator shall
use the best available Federal or State
government data and may use, to the extent
necessary, representative data submitted by
entities that perform such beneficiation or
other processing (including agglomeration), in
making a determination. Fuel cost data shall
not include the cost of fuel used as feedstock
by an industrial sector.
``(ii) Imports and exports.--The
Administrator shall base the value of imports
and exports under this subsection on United
States International Trade Commission data. The
Administrator shall take the average of data
from as many of the years of 2004, 2005, and
2006 for which such data are available. If data
from the United States International Trade
Commission are unavailable for any sector at
the six-digit classification level in the
NAICS, then the Administrator may extrapolate
the information necessary to determine the
eligibility of a sector under this paragraph
from available United States International
Trade Commission data pertaining to a broader
industrial category classified in the NAICS.
``(iii) Percentages.--The Administrator
shall round the energy intensity, greenhouse
gas intensity, and trade intensity percentages
under subparagraph (A) to the nearest whole
number.
``(iv) Greenhouse gas emission
calculations.--When calculating the tons of
carbon dioxide equivalent greenhouse gas
emissions for each sector under subparagraph
(A)(ii)(II)(aa), the Administrator--
``(I) shall use the best available
data from as many of the years 2004,
2005, and 2006 for which such data is
available; and
``(II) may, to the extent necessary
with respect to a sector, use economic
and engineering models and the best
available information on technology
performance levels for such sector.
``(3) Administrative determination of additional eligible
industrial sectors.--
``(A) Updated trade intensity data.--The
Administrator shall designate as eligible to receive
emission allowance rebates under this subpart an
industrial sector that--
``(i) met the energy or greenhouse gas
intensity criteria in paragraph (2)(A)(ii) as
of the date of promulgation of the rule under
paragraph (1); and
``(ii) meets the trade intensity criteria
in paragraph (2)(A)(iii), using data from any
year after 2006.
``(B) Individual showing petition.--
``(i) Petition.--In addition to designation
under paragraph (2) or subparagraph (A) of this
paragraph, the owner or operator of an entity
in an industrial sector may petition the
Administrator to designate as eligible
industrial sectors under this subpart an entity
or a group of entities that--
``(I) represent a subsector of a
six-digit section of the NAICS code;
and
``(II) meet the eligibility
criteria in both clauses (ii) and (iii)
of paragraph (2)(A), or the eligibility
criteria in clause (iv) of paragraph
(2)(A).
``(ii) Data.--In making a determination
under this subparagraph, the Administrator
shall consider data submitted by the petitioner
that is specific to the entity, data solicited
by the Administrator from other entities in the
subsector, if such other entities exist, and
data specified in paragraph (2)(D).
``(iii) Basis of subsector determination.--
The Administrator shall determine an entity or
group of entities to be a subsector of a six-
digit section of the NAICS code based only upon
the products manufactured and not the
industrial process by which the products are
manufactured, except that the Administrator may
determine an entity or group of entities that
manufacture a product from primarily virgin
material to be a separate subsector from
another entity or group of entities that
manufacture the same product primarily from
recycled material.
``(iv) Use of most recent data.--In
determining whether to designate a sector or
subsector as an eligible industrial sector
under this subparagraph, the Administrator
shall use the most recent data available from
the sources described in paragraph (2)(D),
rather than the data from the years specified
in paragraph (2)(D), to determine the trade
intensity of such sector or subsector, but only
for determining such trade intensity.
``(v) Final action.--The Administrator
shall take final action on such petition no
later than 6 months after the petition is
received by the Administrator.
``SEC. 764. DISTRIBUTION OF EMISSION ALLOWANCE REBATES.
``(a) Distribution Schedule.--
``(1) In general.--For each vintage year, the Administrator
shall distribute pursuant to this section emission allowances
made available under section 782(e), no later than October 31
of the preceding calendar year. The Administrator shall make
such annual distributions to the owners and operators of each
entity in an eligible industrial sector in the amount of
emission allowances calculated under subsection (b), except
that--
``(A) for vintage years 2012 and 2013, the
distribution for a covered entity shall be pursuant to
the entity's indirect carbon factor as calculated under
subsection (b)(3);
``(B) for vintage year 2026 and thereafter, the
distribution shall be pursuant to the amount calculated
under subsection (b) multiplied by, except as modified
by the President pursuant to section 767(d)(1)(C) for a
sector--
``(i) 90 percent for vintage year 2026;
``(ii) 80 percent for vintage year 2027;
``(iii) 70 percent for vintage year 2028;
``(iv) 60 percent for vintage year 2029;
``(v) 50 percent for vintage year 2030;
``(vi) 40 percent for vintage year 2031;
``(vii) 30 percent for vintage year 2032;
``(viii) 20 percent for vintage year 2033;
``(ix) 10 percent for vintage year 2034;
and
``(x) 0 percent for vintage year 2035 and
thereafter.
``(2) Resumption of reduction.--If the President has
modified the percentage stated in paragraph (1)(B) under
section 767(d)(1)(C), and the President subsequently makes a
determination under section 767(c) for an eligible industrial
sector that more than 85 percent of United States imports for
that sector are produced or manufactured in countries that have
met at least one of the criteria in that section, then the 10-
year reduction schedule set forth in paragraph (1)(B) of this
subsection shall begin in the next vintage year, with the
percentage reduction based on the amount of the distribution of
emission allowances under this section in the previous year.
``(3) Newly eligible sectors.--In addition to receiving a
distribution of emission allowances under this section in the
first distribution occurring after an industrial sector is
designated as eligible under section 763(b)(3), the owner or
operator of an entity in that eligible industrial sector may
receive a prorated share of any emission allowances made
available for distribution under this section that were not
distributed for the year in which the petition for eligibility
was granted under section 763(b)(3)(A).
``(4) Cessation of qualifying activities.--If, as
determined by the Administrator, a facility is no longer in an
eligible industrial sector designated under section 763--
``(A) the Administrator shall not distribute
emission allowances to the owner or operator of such
facility under this section; and
``(B) the owner or operator of such facility shall
return to the Administrator all allowances that have
been distributed to it for future vintage years and a
pro-rated amount of allowances distributed to the
facility under this section for the vintage year in
which the facility ceases to be in an eligible
industrial sector designated under section 763.
``(b) Calculation of Direct and Indirect Carbon Factors.--
``(1) In general.--
``(A) Covered entities.--Except as provided in
subsection (a), for covered entities that are in
eligible industrial sectors, the amount of emission
allowance rebates shall be based on the sum of the
covered entity's direct and indirect carbon factors.
``(B) Other eligible entities.--For entities that
are in eligible industrial sectors but are not covered
entities, the amount of emission allowance rebates
shall be based on the entity's indirect carbon factor.
``(C) New entities.--Not later than 2 years after
the date of enactment of this title, the Administrator
shall issue regulations governing the distribution of
emission allowance rebates for the first and second
years of operation of a new entity in an eligible
industrial sector. These regulations shall provide
for--
``(i) the distribution of emission
allowance rebates to such entities based on
comparable entities in the same sector; and
``(ii) an adjustment in the third and
fourth years of operation to reconcile the
total amount of emission allowance rebates
received during the first and second years of
operation to the amount the entity would have
received during the first and second years of
operation had the appropriate data been
available.
``(2) Direct carbon factor.--The direct carbon factor for a
covered entity for a vintage year is the product of--
``(A) the average annual output of the covered
entity for the 2 years preceding the year of the
distribution; and
``(B) the most recent calculation of the average
direct greenhouse gas emissions (expressed in tons of
carbon dioxide equivalent) per unit of output for all
covered entities in the sector, as determined by the
Administrator under paragraph (4).
``(3) Indirect carbon factor.--
``(A) In general.--The indirect carbon factor for
an entity for a vintage year is the product obtained by
multiplying the average annual output of the entity for
the 2 years preceding the year of the distribution by
both the electricity emissions intensity factor
determined pursuant to subparagraph (B) and the
electricity efficiency factor determined pursuant to
subparagraph (C) for the year concerned.
``(B) Electricity emissions intensity factor.--
``(i) In general.--Each person selling
electricity to the owner or operator of an
entity in any sector designated as an eligible
industrial sector under section 763(b) shall
provide the owner or operator of the entity and
the Administrator, on an annual basis, the
electricity emissions intensity factor for the
entity. The electricity emissions intensity
factor for the entity, expressed in tons of
carbon dioxide equivalents per kilowatt hour,
is determined by dividing--
``(I) the annual sum of the hourly
product of--
``(aa) the electricity
purchased by the entity from
that person in each hour
(expressed in kilowatt hours);
multiplied by
``(bb) the marginal or
weighted average tons of carbon
dioxide equivalent per kilowatt
hour that are reflected in the
electricity charges to the
entity, as determined by the
entity's retail rate
arrangements; by
``(II) the total kilowatt hours of
electricity purchased by the entity
from that person during that year.
``(ii) Use of other data to determine
factor.--Where it is not possible to determine
the precise electricity emissions intensity
factor for an entity using the methodology in
clause (i), the person selling electricity
shall use the monthly average data reported by
the Energy Information Administration or
collected and reported by the Administrator for
the utility serving the entity to determine the
electricity emissions intensity factor.
``(C) Electricity efficiency factor.--The
electricity efficiency factor is the average amount of
electricity (in kilowatt hours) used per unit of output
for all entities in the relevant sector, as determined
by the Administrator based on the best available data,
including data provided under paragraph (6).
``(D) Indirect carbon factor reduction.--If an
electricity provider received a free allocation of
emission allowances pursuant to section 782(a), the
Administrator shall adjust the indirect carbon factor
to avoid rebates to the eligible entity for costs that
the Administrator determines were not incurred by the
eligible entity because the allowances were freely
allocated to the eligible entity's electricity provider
and used for the benefit of industrial consumers.
``(4) Greenhouse gas intensity calculations.--The
Administrator shall calculate the average direct greenhouse gas
emissions (expressed in tons of carbon dioxide equivalent) per
unit of output and the electricity efficiency factor for all
covered entities in each eligible industrial sector every 4
years, using an average of the four most recent years of the
best available data. For purposes of the lists required to be
published no later than February 1, 2013, the Administrator
shall use the best available data for the maximum number of
years, up to 4 years, for which data are available.
``(5) Ensuring efficiency improvements.--When making
greenhouse gas calculations, the Administrator shall--
``(A) limit the average direct greenhouse gas
emissions per unit of output, calculated under
paragraph (4), for any eligible industrial sector to an
amount that is not greater than it was in any previous
calculation under this subsection;
``(B) limit the electricity emissions intensity
factor, calculated under paragraph (3)(B) and resulting
from a change in electricity supply, for any entity to
an amount that is not greater than it was during any
previous year; and
``(C) limit the electricity efficiency factor,
calculated under paragraph (3)(C), for any eligible
industrial sector to an amount that is not greater than
it was in any previous calculation under this
subsection.
``(6) Data sources.--For the purposes of this subsection--
``(A) the Administrator shall use data from the
greenhouse gas registry established under section 713,
where it is available; and
``(B) each owner or operator of an entity in an
eligible industrial sector and each department, agency,
and instrumentality of the United States shall provide
the Administrator with such information as the
Administrator finds necessary to determine the direct
carbon factor and the indirect carbon factor for each
entity subject to this section.
``(c) Total Maximum Distribution.--Notwithstanding subsections (a)
and (b), the Administrator shall not distribute more allowances for any
vintage year pursuant to this section than are allocated for use under
this subpart pursuant to section 782(e) for that vintage year. For any
vintage year for which the total emission allowance rebates calculated
pursuant to this section exceed the number of allowances allocated
pursuant to section 782(e), the Administrator shall reduce each
entity's distribution on a pro rata basis so that the total
distribution under this section equals the number of allowances
allocated under section 782(e).
``(d) Iron and Steel Sector.--For purposes of this section, the
Administrator shall consider as in different industrial sectors--
``(1) entities using integrated iron and steelmaking
technologies (including coke ovens, blast furnaces, and other
iron-making technologies); and
``(2) entities using electric arc furnace technologies.
``(e) Metal, Soda Ash, or Phosphate Production Classified Under
More Than One Naics Code.--For purposes of this section, the
Administrator shall not aggregate data for the beneficiation or other
processing (including agglomeration) of metal ores, soda ash, or
phosphate with subsequent steps in the process of metal, soda ash, or
phosphate manufacturing. The Administrator shall consider the
beneficiation or other processing (including agglomeration) of metal
ores, soda ash, or phosphate to be in separate industrial sectors from
the metal, soda ash, or phosphate manufacturing sectors. Industrial
sectors that beneficiate or otherwise process (including agglomeration)
metal ores, soda ash, or phosphate shall not receive emission allowance
rebates under this section related to the activity of extracting metal
ores, soda ash, or phosphate.
``(f) Combined Heat and Power.--For purposes of this section, and
to achieve the purpose set forth in section 761(b)(2), the
Administrator may consider entities to be in different industrial
sectors or otherwise take into account the differences among entities
in the same industrial sector, based upon the extent to which such
entities use combined heat and power technologies.
``Subpart 2--Promoting International Reductions in Industrial Emissions
``SEC. 765. INTERNATIONAL NEGOTIATIONS.
``(a) Finding.--Congress finds that the purposes of this subpart,
as set forth in section 761(c), can be most effectively addressed and
achieved through agreements negotiated between the United States and
foreign countries.
``(b) Statement of Policy.--It is the policy of the United States
to work proactively under the United Nations Framework Convention on
Climate Change, and in other appropriate fora, to establish binding
agreements, including sectoral agreements, committing all major
greenhouse gas-emitting nations to contribute equitably to the
reduction of global greenhouse gas emissions.
``(c) Notification of Foreign Countries.--
``(1) In general.--As soon as practicable after the date of
the enactment of this title, the President shall provide a
notification on climate change described in paragraph (2) to
each foreign country the products of which are not exempted
under section 768(a)(1)(E).
``(2) Notification described.--A notification described in
this paragraph is a notification that consists of--
``(A) a statement of the policy of the United
States described in subsection (b); and
``(B) a declaration--
``(i) requesting the foreign country to
take appropriate measures to limit the
greenhouse gas emissions of the foreign
country; and
``(ii) indicating that, beginning on
January 1, 2020, the international reserve
requirements of this subpart may apply to a
covered good.
``SEC. 766. UNITED STATES NEGOTIATING OBJECTIVES WITH RESPECT TO
MULTILATERAL ENVIRONMENTAL NEGOTIATIONS.
``(a) In General.--The negotiating objectives of the United States
with respect to multilateral environmental negotiations described in
this subpart are--
``(1) to reach an internationally binding agreement in
which all major greenhouse gas-emitting countries contribute
equitably to the reduction of global greenhouse gas emissions;
``(2)(A) to include in such international agreement
provisions that recognize and address the competitive
imbalances that lead to carbon leakage and may be created
between parties and non-parties to the agreement in domestic
and export markets; and
``(B) not to prevent parties to such agreement from
addressing the competitive imbalances that lead to carbon
leakage and may be created by the agreement among parties to
the agreement in domestic and export markets ; and
``(3) to include in such international agreement agreed
remedies for any party to the agreement that fails to meet its
greenhouse gas reduction obligations in the agreement.
``(b) Rule of Construction.--Nothing in subsection (a)(2) shall be
construed to require the United States to alter the provisions of
section 764 .
``SEC. 767. PRESIDENTIAL REPORTS AND DETERMINATIONS.
``(a) Report.--Not later than January 1, 2017, and every 2 years
thereafter, the President shall submit a report to Congress on the
effectiveness of the distribution of emission allowance rebates under
subpart 1 in mitigating carbon leakage in eligible industrial sectors.
Such report shall also include--
``(1) an assessment, for each eligible industrial sector
receiving emission allowance rebates, as to whether, and by how
much, the per unit cost of production has increased for that
sector as a result of compliance with section 722 (as
determined in a manner consistent with section 764(b)), taking
into account the provision of the emission allowance rebates to
that industrial sector and the benefit received by that
industrial sector from the provision of free allowances to
electricity providers pursuant to section 782(a);
``(2) recommendations on how to better achieve the purposes
of this subpart, including an assessment of the feasibility and
usefulness of an international reserve allowance program for
the eligible industrial sector under section 768;
``(3) to the extent the President determines that an
international reserve allowance program would not be useful for
the eligible industrial sector because its exposure to carbon
leakage is the result of competition in export markets with
goods produced in countries not implementing similar greenhouse
gas emission reduction policies, an identification of, and to
the extent appropriate a description of how the President will
implement, alternative actions or programs consistent with the
purposes of this subpart (and, in such case, the President may
determine not to apply an international reserve allowance
program to the eligible industrial sector under subsection
(b)); and
``(4) an assessment of the amount and duration of
assistance, including distribution of free allowances, being
provided to industrial sectors in other developed countries to
mitigate costs of compliance with domestic greenhouse gas
reduction programs in such countries.
``(b) Presidential Determination.--
``(1) In general.--If, by January 1, 2018, a multilateral
agreement consistent with the negotiating objectives set forth
in section 766 has not entered into force with respect to the
United States, the President shall establish an international
reserve allowance program for each eligible industrial sector
to the extent provided under section 768 unless--
``(A) the President determines and certifies to the
Congress with respect to such eligible industrial
sector that such program would not be in the national
economic interest or environmental interest of the
United States; and
``(B) not later than 90 days after the President
transmits the certification described in subparagraph
(A), a joint resolution is enacted into law that
approves the determination of the President described
in subparagraph (A).
``(2) Contents of joint resolution.--For purposes of this
subsection, the term `joint resolution' means only a joint
resolution of the two Houses of Congress, the matter after the
resolving clause of which is as follows: `That the Congress
approves the determination of the President under section
768(b)(1)(A) of the Clean Air Act transmitted to the Congress
on ______.', the blank space being filled with the appropriate
date.
``(3) Congressional procedures.--Subsections (c), (d), (e),
and (f) of section 152 of the Trade Act of 1974 (19 U.S.C. 2192
(c), (d), (e), and (f)) shall apply to a joint resolution under
this subsection to the same extent as such subsections apply to
a joint resolution under section 152 of such Act.
``(4) Rule of construction.--For purposes of this section
and section 768, if the President transmits a multilateral
agreement to Congress (regardless of whether it is transmitted
as a treaty for ratification by the Senate or another
international agreement for implementation by law enacted by
the Congress) indicating that the agreement is consistent with
the negotiating objectives set forth in section 766, such
agreement will be considered to be consistent with such
negotiating objectives as of the date on which the Senate
ratifies the treaty, or legislation is enacted implementing
such other agreement, unless the Senate (in the case of
ratification) or the implementing legislation expressly
provides that the multilateral agreement shall not be treated
as consistent with such negotiating objectives for purposes of
this section and section 768.
``(c) Determinations With Respect to Eligible Industrial Sectors.--
If the President establishes an international reserve allowance program
pursuant to subsection (b), then not later than June 30, 2018, and
every 4 years thereafter, the President, in consultation with the
Administrator and other appropriate agencies, shall determine, for each
eligible industrial sector, whether or not more than 85 percent of
United States imports of covered goods with respect to that sector are
produced or manufactured in countries that have met at least one of the
following criteria:
``(1) The country is a party to an international agreement
to which the United States is a party that includes a
nationally enforceable and economy-wide greenhouse gas
emissions reduction commitment for that country that is at
least as stringent as that of the United States.
``(2) The country is a party to a multilateral or bilateral
emission reduction agreement for that sector to the which the
United States is a party.
``(3) The country has an annual energy or greenhouse gas
intensity, as described in section 763(b)(2)(A)(ii), for the
sector that is equal to or less than the energy or greenhouse
gas intensity for such industrial sector in the United States
in the most recent calendar year for which data are available.
``(d) Effect of Presidential Determination.--
``(1) Required actions.--If the President makes a
determination under subsection (c) with respect to an eligible
industrial sector that 85 percent or less of United States
imports of covered goods with respect to the sector are
produced or manufactured in countries that have met one or more
of the criteria in subsection (c), then the President shall,
not later than June 30, 2018, and every 4 years thereafter--
``(A) assess the extent to which the emission
allowance rebates provided pursuant to subpart 1 and
the benefit received by that industrial sector from the
provision of free allowances to electricity providers
pursuant to section 782(a) have mitigated or addressed,
or could mitigate or address, carbon leakage in that
sector;
``(B) assess the extent to which an international
reserve allowance program has mitigated or addressed,
or could mitigate or address, carbon leakage in that
sector; and
``(C) with respect to that sector--
``(i) modify the percentage by which direct
and indirect carbon factors will be multiplied
under section 764(a)(1)(B); and
``(ii) apply or continue to apply an
international reserve allowance program under
section 768 with respect to imports of covered
goods with respect to that sector.
``(2) Prohibited actions.--If the President makes a
determination under subsection (c) with respect to an eligible
industrial sector that more than 85 percent of United States
imports of covered goods with respect to the sector are
produced or manufactured in countries that have met one or more
of the criteria in subsection (c), then the President may not
apply or continue to apply an international reserve allowance
program under section 768 with respect to imports of covered
goods with respect to that sector.
``(e) Report to Congress.--Not later than June 30, 2018, and every
4 years thereafter, the President shall transmit to the Congress a
report providing notice of any determination made under subsection (c),
explaining the reasons for such determination, and identifying the
actions taken by the President under subsection (d).
``SEC. 768. INTERNATIONAL RESERVE ALLOWANCE PROGRAM.
``(a) Establishment.--
``(1) In general.--The Administrator, with the concurrence
of Commissioner responsible for U.S. Customs and Border
Protection, shall issue regulations--
``(A) establishing an international reserve
allowance program for the sale, exchange, purchase,
transfer, and banking of international reserve
allowances for covered goods with respect to the
eligible industrial sector;
``(B) ensuring that the price for purchasing the
international reserve allowances from the United States
on a particular day is equivalent to the auction
clearing price for emission allowances under section
722 for the most recent emission allowance auction;
``(C) establishing a general methodology for
calculating the quantity of international reserve
allowances that a United States importer of any covered
good must submit;
``(D) requiring the submission of appropriate
amounts of such allowances for covered goods with
respect to the eligible industrial sector that enter
the customs territory of the United States;
``(E) exempting from the requirements of
subparagraph (D) such products that are the origin of--
``(i) any country determined to meet any of
the standards provided in section 767(c);
``(ii) any foreign country that the United
Nations has identified as among the least
developed of developing countries; or
``(iii) any foreign country that the
President has determined to be responsible for
less than 0.5 percent of total global
greenhouse gas emissions and less than 5
percent of United States imports of covered
goods with respect to the eligible industrial
sector;
``(F) specifying the procedures that U.S. Customs
and Border Protection will apply for the declaration
and entry of covered goods with respect to the eligible
industrial sector into the customs territory of the
United States; and
``(G) establishing procedures that prevent
circumvention of the international reserve allowance
requirement for covered goods with respect to the
eligible industrial sector that are manufactured or
processed in more than one foreign country.
``(2) Purpose of program.--The Administrator shall
establish the program under paragraph (1) consistent with
international agreements to which the United States is a party,
in a manner that minimizes the likelihood of carbon leakage as
a result of differences between--
``(A) the direct and indirect costs of complying
with section 722; and
``(B) the direct and indirect costs, if any, of
complying in other countries with greenhouse gas
regulatory programs, requirements, export tariffs, or
other measures adopted or imposed to reduce greenhouse
gas emissions.
``(b) Emission Allowance Rebates.--In establishing a general
methodology for purposes of subsection (a)(1)(C), the Administrator
shall include an adjustment to the quantity of international reserve
allowances based on the value of emission allowance rebates distributed
under subpart 1 and the benefit received by the eligible industrial
sector concerned from the provision of free allowances to electricity
providers pursuant to section 782(a) and may, if appropriate, determine
that the quantity of international reserve allowances should be reduced
as low as to zero.
``(c) Effective Date.--The international reserve allowance program
may not apply to imports of covered goods entering the customs
territory of the United States before January 1, 2020.
``(d) Covered Entities.--International reserve allowances may not
be used by covered entities to comply with section 722.
``SEC. 769. IRON AND STEEL SECTOR.
``For purposes of this subpart, the Administrator shall consider to
be in the same eligible industrial sector--
``(1) entities using integrated iron and steelmaking
technologies (including coke ovens, blast furnaces, and other
iron-making technologies); and
``(2) entities using electric arc furnace technologies.''.
Subtitle B--Green Jobs and Worker Transition
PART 1--GREEN JOBS
SEC. 421. CLEAN ENERGY CURRICULUM DEVELOPMENT GRANTS.
(a) Authorization.--The Secretary of Education is authorized to
award grants, on a competitive basis, to eligible partnerships to
develop programs of study (containing the information described in
section 122(c)(1)(A) of the Carl D. Perkins Career and Technical
Education Act of 2006 (20 U.S.C. 2342)), that are focused on emerging
careers and jobs in the fields of clean energy, renewable energy,
energy efficiency, climate change mitigation, and climate change
adaptation. The Secretary of Education shall consult with the Secretary
of Labor and the Secretary of Energy prior to the issuance of a
solicitation for grant applications.
(b) Eligible Partnerships.--For purposes of this section, an
eligible partnership shall include--
(1) at least 1 local educational agency eligible for
funding under section 131 of the Carl D. Perkins Career and
Technical Education Act of 2006 (20 U.S.C. 2351) or an area
career and technical education school or education service
agency described in such section;
(2) at least 1 postsecondary institution eligible for
funding under section 132 of such Act (20 U.S.C. 2352); and
(3) representatives of the community including business,
labor organizations, and industry that have experience in
fields as described in subsection (a).
(c) Application.--An eligible partnership seeking a grant under
this section shall submit an application to the Secretary at such time
and in such manner as the Secretary may require. Applications shall
include--
(1) a description of the eligible partners and partnership,
the roles and responsibilities of each partner, and a
demonstration of each partner's capacity to support the
program;
(2) a description of the career area or areas within the
fields as described in subsection (a) to be developed, the
reason for the choice, and evidence of the labor market need to
prepare students in that area;
(3) a description of the new or existing program of study
and both secondary and postsecondary components;
(4) a description of the students to be served by the new
program of study;
(5) a description of how the program of study funded by the
grant will be replicable and disseminated to schools outside of
the partnership, including urban and rural areas;
(6) a description of applied learning that will be
incorporated into the program of study and how it will
incorporate or reinforce academic learning;
(7) a description of how the program of study will be
delivered;
(8) a description of how the program will provide
accessibility to students, especially economically
disadvantaged, low performing, and urban and rural students;
(9) a description of how the program will address placement
of students in nontraditional fields as described in section
3(20) of the Carl D. Perkins Career and Technical Education Act
of 2006 (20 U.S.C. 2302(20)); and
(10) a description of how the applicant proposes to consult
or has consulted with a labor organization, labor management
partnership, apprenticeship program, or joint apprenticeship
and training program that provides education and training in
the field of study for which the applicant proposes to develop
a curriculum.
(d) Priority.--The Secretary shall give priority to applications
that--
(1) use online learning or other innovative means to
deliver the program of study to students, educators, and
instructors outside of the partnership; and
(2) focus on low performing students and special
populations as defined in section 3(29) of the Carl D. Perkins
Career and Technical Education Act of 2006 (20 U.S.C.
2302(29)).
(e) Peer Review.--The Secretary shall convene a peer review process
to review applications for grants under this section and to make
recommendations regarding the selection of grantees. Members of the
peer review committee shall include--
(1) educators who have experience implementing curricula
with comparable purposes; and
(2) business and industry experts in fields as described in
subsection (a).
(f) Uses of Funds.--Grants awarded under this section shall be used
for the development, implementation, and dissemination of programs of
study (as described in section 122(c)(1)(A) of the Carl D. Perkins
Career and Technical Education Act (20 U.S.C. 2342(c)(1)(A))) in career
areas related to clean energy, renewable energy, energy efficiency,
climate change mitigation, and climate change adaptation.
SEC. 422. INCREASED FUNDING FOR ENERGY WORKER TRAINING PROGRAM.
(a) Authorization.--Section 171(e)(8) of the Workforce Investment
Act of 1998 (29 U.S.C. 2916(e)(8)) is amended by striking
``$125,000,000'' and inserting ``$150,000,000''.
(b) Establishment of Fund.--There is hereby established in the
Treasury a separate account that shall be known as the Energy
Efficiency and Renewable Energy Worker Training Fund.
(c) Availability of Amounts.--Subject to subtitle F of title IV,
all amounts deposited into the Energy Efficiency and Renewable Energy
Worker Training Fund shall be available to the Secretary to carry out
section 171(e)(8) of the Workforce Investment Act of 1998 (29 U.S.C.
2916(e)(8)) subject to further appropriation.
SEC. 423. DEVELOPMENT OF INFORMATION AND RESOURCES CLEARINGHOUSE FOR
VOCATIONAL EDUCATION AND JOB TRAINING IN RENEWABLE ENERGY
SECTORS.
(a) Development of Clearinghouse.--Not later than 18 months after
the date of enactment of this Act, the Secretary of Labor, in
collaboration with the Secretary of Energy and the Secretary of
Education, shall develop an internet based information and resources
clearinghouse to aid career and technical education and job training
programs for the renewable energy sectors. In establishing the
clearinghouse, the Secretary shall--
(1) collect and provide information that addresses the
consequences of rapid changes in technology and regional
disparities for renewable energy training programs and provides
best practices for training and education in light of such
changes and disparities;
(2) place an emphasis on facilitating collaboration between
the renewable energy industry and job training programs and on
identifying industry and technological trends and best
practices, to better help job training programs maintain
quality and relevance; and
(3) place an emphasis on assisting programs that cater to
high-demand middle-skill, trades, manufacturing, contracting,
and consulting careers.
(b) Solicitation and Consultation.--In developing the clearinghouse
pursuant to subsection (a), the Secretary shall solicit information and
expertise from businesses and organizations in the renewable energy
sector and from institutions of higher education, career and technical
schools, and community colleges that provide training in the renewable
energy sectors. The Secretary shall solicit a comprehensive peer review
of the clearinghouse by such entities not less than once every 2 years.
Nothing in this subsection should be interpreted to require the
divulgence of proprietary or competitive information.
(c) Contents of Clearinghouse.--
(1) Separate section for each renewable energy sector.--The
clearinghouse shall contain separate sections developed for
each of the following renewable energy sectors:
(A) Solar energy systems.
(B) Wind energy systems.
(C) Energy transmission systems.
(D) Geothermal systems of energy and heating.
(E) Energy efficiency technical training.
(2) Additional requirements.--In addition to the
information required in subsection (a), each section of the
clearinghouse shall include information on basic environmental
science and processes needed to understand renewable energy
systems, Federal government and industry resources, and points
of contact to aid institutions in the development of placement
programs for apprenticeships and post graduation opportunities,
and information and tips about a green workplace, energy
efficiency, and relevant environmental topics and information
on available industry recognized certifications in each area.
(d) Dissemination.--The clearinghouse shall be made available via
the Internet to the general public. Notice of the completed
clearinghouse and any major revisions thereto shall also be provided--
(1) to each Member of Congress; and
(2) on the websites of the Departments of Education,
Energy, and Labor.
(e) Revision.--The Secretary of Labor shall revise and update the
clearinghouse on a regular basis to ensure its relevance.
SEC. 424. MONITORING PROGRAM EFFECTIVENESS.
The Secretary of Labor shall monitor the potential growth of
affected and displaced workers to ensure that the necessary funding
continues to support the number of workers affected.
SEC. 424A. GREEN CONSTRUCTION CAREERS DEMONSTRATION PROJECT.
(a) Establishment and Authority.--The Secretary of Labor, in
consultation with the Secretary of Energy, shall, not later than 180
days after the enactment of this Act, establish a Green Construction
Careers demonstration project by rules, regulations, and guidance in
accordance with the provisions of this section. The purpose of the
demonstration project shall be to promote middle class careers and
quality employment practices in the green construction sector among
targeted workers and to advance efficiency and performance on
construction projects related to this Act. In order to advance these
purposes, the Secretary shall identify projects, including residential
retrofitting projects, funded directly by or assisted in whole or in
part by or through the Federal Government pursuant to this Act or by
any other entity established in accordance with this Act, to which all
of the following shall apply.
(b) Requirements.--The Secretaries may establish such terms and
conditions for the demonstration projects as the Secretaries determine
are necessary to meet the purposes of subsection (a), including
establishing minimum proportions of hours to be worked by targeted
workers on such projects. The Secretaries may require the contractors
and subcontractors performing construction services on the project to
comply with the terms and conditions as a condition of receiving
funding or assistance from the Federal Government under this Act.
(c) Evaluation.--The Secretaries shall evaluate the demonstration
projects against the purposes of this section at the end of 3 years
from initiation of the demonstration project. If the Secretaries
determine that the demonstration projects have been successful, the
Secretaries may identify further projects to which of the provisions of
this section shall apply.
(d) GAO Report.--The Comptroller General shall prepare and submit a
report to the Committee on Health, Education, Labor and Pensions and
the Committee on Energy and Natural Resources of the Senate and the
Committee on Education and Labor and the Committee on Energy and
Commerce of the House of Representatives not later than 5 years after
the date of enactment of this Act, which shall advise the committees of
the results of the demonstration projects and make appropriate
recommendations.
(e) Definition and Designation of Targeted Workers.--As used in
this section, the term ``targeted worker'' means an individual who
resides in the same labor market area (as defined in section 101(18) of
the Workforce Investment Act of 1998 (29 U.S.C. 2801(18))) as the
project and who--
(1) is a member of a targeted group, within the meaning of
section 51 of the Internal Revenue Code of 1986, other than an
individual described in subsection (d)(1)(C) of such section;
(2)(A) resides in a census tract in which not less than 20
percent of the households have incomes below the Federal
poverty guidelines; or
(B) is a member of a family that received a total
family income that, during the 2-year period prior to
employment on the project or admission to the pre-
apprenticeship program, did not exceed 200 percent of
the Federal poverty guidelines (exclusive of
unemployment compensation, child support payments,
payments described in section 101(25)(A) of the
Workforce Investment Act (29 U.S.C. 2801(25)(A)), and
old-age and survivors insurance benefits received under
section 202 of the Social Security Act (42 U.S.C. 402);
or
(3) is a displaced homemaker, as such term is defined in
section 3(10) of the Carl D. Perkins Career and Technical
Education Act of 2006 (20 U.S.C. 2302(10)).
(f) Qualified Pre-apprenticeship Program.--A qualified pre-
apprenticeship program is a pre-apprenticeship program that has
demonstrated an ability to recruit, train, and prepare for admission to
apprenticeship programs individuals who are targeted workers.
(g) Qualified Apprenticeship and Other Training Programs.--
(1) Participation by each contractor required.--Each
contractor and subcontractor that seeks to provide construction
services on projects identified by the Secretaries pursuant to
subsection (a) shall submit adequate assurances with its bid or
proposal that it participates in a qualified apprenticeship or
other training program, with a written arrangement with a
qualified pre-apprenticeship program, for each craft or trade
classification of worker that it intends to employ to perform
work on the project.
(2) Definition of qualified apprentice ship or other
training program.--
(A) In general.--For purposes of this section, the
term ``qualified apprenticeship or other training
program'' means an apprenticeship or other training
program that qualifies as an employee welfare benefit
plan, as defined in section 3(1) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C.
1002(1)).
(B) Certification of other programs in certain
localities.--In the event that the Secretary of Labor
certifies that a qualified apprenticeship or other
training program (as defined in subparagraph (A)) for a
craft or trade classification of workers that a
prospective contractor or subcontractor intends to
employ, is not operated in the locality where the
project will be performed, an apprenticeship or other
training program that is not an employee welfare
benefit plan (as defined in such section) may be
certified by the Secretary as a qualified
apprenticeship or other training program provided it is
registered with the Office of Apprenticeship of the
Department of Labor, or a State apprenticeship agency
recognized by the Office of Apprenticeship for Federal
purposes.
(h) Facilitating Compliance.--The Secretary may require Federal
contracting agencies, recipients of Federal assistance, and any other
entity established in accordance with this Act to require contractors
to enter into an agreement in a manner comparable with the standards
set forth in sections 3 and 4 of Executive Order 13502 in order to
achieve the purposes of this section, including any requirements
established by subsection (b).
(i) Limitation.--The requirements of this section shall not apply
to any project funded under this Act in American Samoa, Guam, the
Commonwealth of the Northern Mariana Islands, the Commonwealth of
Puerto Rico, or the United States Virgin Islands, unless participation
is requested by the governor of such territories within 1 year of the
promulgation of rules under this Act.
PART 2--CLIMATE CHANGE WORKER ADJUSTMENT ASSISTANCE
SEC. 425. PETITIONS, ELIGIBILITY REQUIREMENTS, AND DETERMINATIONS.
(a) Petitions.--
(1) Filing.--A petition for certification of eligibility to
apply for adjustment assistance for a group of workers under
this part may be filed by any of the following:
(A) The group of workers.
(B) The certified or recognized union or other duly
authorized representative of such workers.
(C) Employers of such workers, one-stop operators
or one-stop partners (as defined in section 101 of the
Workforce Investment Act of 1998 (29 U.S.C. 2801)),
including State employment security agencies, or the
State dislocated worker unit established under title I
of such Act, on behalf of such workers.
The petition shall be filed simultaneously with the Secretary
of Labor and with the Governor of the State in which such
workers' employment site is located.
(2) Action by governors.--Upon receipt of a petition filed
under paragraph (1), the Governor shall--
(A) ensure that rapid response activities and
appropriate core and intensive services (as described
in section 134 of the Workforce Investment Act of 1998
(29 U.S.C. 2864)) authorized under other Federal laws
are made available to the workers covered by the
petition to the extent authorized under such laws; and
(B) assist the Secretary in the review of the
petition by verifying such information and providing
such other assistance as the Secretary may request.
(3) Action by the secretary.--Upon receipt of the petition,
the Secretary shall promptly publish notice in the Federal
Register and on the website of the Department of Labor that the
Secretary has received the petition and initiated an
investigation.
(4) Hearings.--If the petitioner, or any other person found
by the Secretary to have a substantial interest in the
proceedings, submits not later than 10 days after the date of
the Secretary's publication under paragraph (3) a request for a
hearing, the Secretary shall provide for a public hearing and
afford such interested persons an opportunity to be present, to
produce evidence, and to be heard.
(b) Eligibility.--
(1) In general.--A group of workers shall be certified by
the Secretary as eligible to apply for adjustment assistance
under this part pursuant to a petition filed under subsection
(a) if--
(A) the group of workers is employed in--
(i) energy producing and transforming
industries;
(ii) industries dependent upon energy
industries;
(iii) energy-intensive manufacturing
industries;
(iv) consumer goods manufacturing; or
(v) other industries whose employment the
Secretary determines has been adversely
affected by any requirement of title VII of the
Clean Air Act;
(B) the Secretary determines that a significant
number or proportion of the workers in such workers'
employment site have become totally or partially
separated, or are threatened to become totally or
partially separated from employment; and
(C) the sales, production, or delivery of goods or
services have decreased as a result of any requirement
of title VII of the Clean Air Act, including--
(i) the shift from reliance upon fossil
fuels to other sources of energy, including
renewable energy, that results in the closing
of a facility or layoff of employees at a
facility that mines, produces, processes, or
utilizes fossil fuels to generate electricity;
(ii) a substantial increase in the cost of
energy required for a manufacturing facility to
produce items whose prices are competitive in
the marketplace, to the extent the cost is not
offset by allowance allocation to the facility
pursuant to title VII of the Clean Air Act; or
(iii) other documented occurrences that the
Secretary determines are indicators of an
adverse impact on an industry described in
subparagraph (A) as a result of any requirement
of title VII of the Clean Air Act.
(2) Workers in public agencies.--A group of workers in a
public agency shall be certified by the Secretary as eligible
to apply for climate change adjustment assistance pursuant to a
petition filed if the Secretary determines that a significant
number or proportion of the workers in the public agency have
become totally or partially separated from employment, or are
threatened to become totally or partially separated as a result
of any requirement of title VII of the Clean Air Act.
(3) Adversely affected service workers.--A group of workers
shall be certified as eligible to apply for climate change
adjustment assistance pursuant to a petition filed if the
Secretary determines that--
(A) a significant number or proportion of the
service workers at an employment site where a group of
workers has been certified by the Secretary as eligible
to apply for adjustment assistance under this part
pursuant to paragraph (1) have become totally or
partially separated from employment, or are threatened
to become totally or partially separated; and
(B) a loss of business in the firm providing
service workers to an employment site is directly
attributable to one or more of the documented
occurrences listed in paragraph (1)(C).
(c) Authority to Investigate and Collect Information.--
(1) In general.--The Secretary shall, in determining
whether to certify a group of workers under subsection (d),
obtain information the Secretary determines to be necessary to
make the certification, through questionnaires and in such
other manner as the Secretary determines appropriate from--
(A) the workers' employer;
(B) officials of certified or recognized unions or
other duly authorized representatives of the group of
workers; or
(C) one-stop operators or one-stop partners (as
defined in section 101 of the Workforce Investment Act
of 1998 (29 U.S.C. 2801)); or
(2) Verification of information.--The Secretary shall
require an employer, union, or one-stop operator or partner to
certify all information obtained under paragraph (1) from the
employer, union, or one-stop operator or partner (as the case
may be) on which the Secretary relies in making a determination
under subsection (d), unless the Secretary has a reasonable
basis for determining that such information is accurate and
complete without being certified.
(3) Protection of confidential information.--The Secretary
may not release information obtained under paragraph (1) that
the Secretary considers to be confidential business information
unless the employer submitting the confidential business
information had notice, at the time of submission, that the
information would be released by the Secretary, or the employer
subsequently consents to the release of the information.
Nothing in this paragraph shall be construed to prohibit the
Secretary from providing such confidential business information
to a court in camera or to another party under a protective
order issued by a court.
(d) Determination by the Secretary of Labor.--
(1) In general.--As soon as possible after the date on
which a petition is filed under subsection (a), but in any
event not later than 40 days after that date, the Secretary, in
consultation with the Secretary of Energy and the
Administrator, as necessary, shall determine whether the
petitioning group meets the requirements of subsection (b) and
shall issue a certification of eligibility to apply for
assistance under this part covering workers in any group which
meets such requirements. Each certification shall specify the
date on which the total or partial separation began or
threatened to begin. Upon reaching a determination on a
petition, the Secretary shall promptly publish a summary of the
determination in the Federal Register and on the website of the
Department of Labor, together with the Secretary's reasons for
making such determination.
(2) One year limitation.--A certification under this
section shall not apply to any worker whose last total or
partial separation from the employment site before the worker's
application under section 426(a) occurred more than 1 year
before the date of the petition on which such certification was
granted.
(3) Revocation of certification.--Whenever the Secretary
determines, with respect to any certification of eligibility of
the workers of an employment site, that total or partial
separations from such site are no longer a result of the
factors specified in subsection (b)(1), the Secretary shall
terminate such certification and promptly have notice of such
termination published in the Federal Register and on the
website of the Department of Labor, together with the
Secretary's reasons for making such determination. Such
termination shall apply only with respect to total or partial
separations occurring after the termination date specified by
the Secretary.
(e) Industry Notification of Assistance.--Upon receiving a
notification of a determination under subsection (d) with respect to a
domestic industry the Secretary of Labor shall notify the
representatives of the domestic industry affected by the determination,
employers publicly identified by name during the course of the
proceeding relating to the determination, and any certified or
recognized union or, to the extent practicable, other duly authorized
representative of workers employed by such representatives of the
domestic industry, of--
(1) the adjustment allowances, training, and other benefits
available under this part;
(2) the manner in which to file a petition and apply for
such benefits; and
(3) the availability of assistance in filing such
petitions;
(4) notify the Governor of each State in which one or more
employers in such industry are located of the Secretary's
determination and the identity of the employers; and
(5) upon request, provide any assistance that is necessary
to file a petition under subsection (a).
(f) Benefit Information to Workers, Providers of Training.--
(1) In general.--The Secretary shall provide full
information to workers about the adjustment allowances,
training, and other benefits available under this part and
about the petition and application procedures, and the
appropriate filing dates, for such allowances, training and
services. The Secretary shall provide whatever assistance is
necessary to enable groups of workers to prepare petitions or
applications for program benefits. The Secretary shall make
every effort to insure that cooperating State agencies fully
comply with the agreements entered into under section 426(a)
and shall periodically review such compliance. The Secretary
shall inform the State Board for Vocational Education or
equivalent agency, the one-stop operators or one-stop partners
(as defined in section 101 of the Workforce Investment Act of
1998 (29 U.S.C. 2801), and other public or private agencies,
institutions, and employers, as appropriate, of each
certification issued under subsection (d) and of projections,
if available, of the needs for training under as a result of
such certification.
(2) Notice by mail.--The Secretary shall provide written
notice through the mail of the benefits available under this
part to each worker whom the Secretary has reason to believe is
covered by a certification made under subsection (d)--
(A) at the time such certification is made, if the
worker was partially or totally separated from the
adversely affected employment before such
certification, or--
(B) at the time of the total or partial separation
of the worker from the adversely affected employment,
if subparagraph (A) does not apply.
(3) Newspapers; website.--The Secretary shall publish
notice of the benefits available under this part to workers
covered by each certification made under subsection (d) in
newspapers of general circulation in the areas in which such
workers reside and shall make such information available on the
website of the Department of Labor.
SEC. 426. PROGRAM BENEFITS.
(a) Climate Change Adjustment Allowance.--
(1) Eligibility.--Payment of a climate change adjustment
allowance shall be made to an adversely affected worker covered
by a certification under section 425(b) who files an
application for such allowance for any week of unemployment
which begins on or after the date of such certification, if the
following conditions are met:
(A) Such worker's total or partial separation
before the worker's application under this part
occurred--
(i) on or after the date, as specified in
the certification under which the worker is
covered, on which total or partial separation
began or threatened to begin in the adversely
affected employment;
(ii) before the expiration of the 2-year
period beginning on the date on which the
determination under section 425(d) was made;
and
(iii) before the termination date, if any,
determined pursuant to section 425(d)(3).
(B) Such worker had, in the 52-week period ending
with the week in which such total or partial separation
occurred, at least 26 weeks of full-time employment or
1,040 hours of part time employment in adversely
affected employment, or, if data with respect to weeks
of employment are not available, equivalent amounts of
employment computed under regulations prescribed by the
Secretary. For the purposes of this paragraph, any week
in which such worker--
(i) is on employer-authorized leave for
purposes of vacation, sickness, injury,
maternity, or inactive duty or active duty
military service for training;
(ii) does not work because of a disability
that is compensable under a workmen's
compensation law or plan of a State or the
United States;
(iii) had his employment interrupted in
order to serve as a full-time representative of
a labor organization in such firm; or
(iv) is on call-up for purposes of active
duty in a reserve status in the Armed Forces of
the United States, provided such active duty is
``Federal service'' as defined in section
8521(a)(1) of title 5, United States Code,
shall be treated as a week of employment.
(C) Such worker is enrolled in a training program
approved by the Secretary under subsection (b)(2).
(2) Ineligibility for certain other benefits.--An adversely
affected worker receiving a payment under this section shall be
ineligible to receive any other form of unemployment insurance
for the period in which such worker is receiving a climate
change adjustment allowance under this section.
(3) Revocation.--If--
(A) the Secretary determines that--
(i) the adversely affected worker--
(I) has failed to begin
participation in the training program
the enrollment in which meets the
requirement of paragraph (1)(C); or
(II) has ceased to participate in
such training program before completing
such training program; and
(ii) there is no justifiable cause for such
failure or cessation; or
(B) the certification made with respect to such
worker under section 425(d) is revoked under paragraph
(3) of such section,
no adjustment allowance may be paid to the adversely affected
worker under this part for the week in which such failure,
cessation, or revocation occurred, or any succeeding week,
until the adversely affected worker begins or resumes
participation in a training program approved by the Secretary
under section (b)(2).
(4) Waivers of training requirements.--The Secretary may
issue a written statement to an adversely affected worker
waiving the requirement to be enrolled in training described in
subsection (b)(2) if the Secretary determines that it is not
feasible or appropriate for the worker, because of 1 or more of
the following reasons:
(A) Recall.--The worker has been notified that the
worker will be recalled by the employer from which the
separation occurred.
(B) Marketable skills.--
(i) In general.--The worker possesses
marketable skills for suitable employment (as
determined pursuant to an assessment of the
worker, which may include the profiling system
under section 303(j) of the Social Security Act
(42 U.S.C. 503(j)), carried out in accordance
with guidelines issued by the Secretary) and
there is a reasonable expectation of employment
at equivalent wages in the foreseeable future.
(ii) Marketable skills defined.--For
purposes of clause (i), the term ``marketable
skills'' may include the possession of a
postgraduate degree from an institution of
higher education (as defined in section 102 of
the Higher Education Act of 1965 (20 U.S.C.
1002)) or an equivalent institution, or the
possession of an equivalent postgraduate
certification in a specialized field.
(C) Retirement.--The worker is within 2 years of
meeting all requirements for entitlement to either--
(i) old-age insurance benefits under title
II of the Social Security Act (42 U.S.C. 401 et
seq.) (except for application therefor); or
(ii) a private pension sponsored by an
employer or labor organization.
(D) Health.--The worker is unable to participate in
training due to the health of the worker, except that a
waiver under this subparagraph shall not be construed
to exempt a worker from requirements relating to the
availability for work, active search for work, or
refusal to accept work under Federal or State
unemployment compensation laws.
(E) Enrollment unavailable.--The first available
enrollment date for the training of the worker is
within 60 days after the date of the determination made
under this paragraph, or, if later, there are
extenuating circumstances for the delay in enrollment,
as determined pursuant to guidelines issued by the
Secretary.
(F) Training not available.--Training described in
subsection (b)(2) is not reasonably available to the
worker from either governmental agencies or private
sources (which may include area career and technical
education schools, as defined in section 3 of the Carl
D. Perkins Career and Technical Education Act of 2006
(20 U.S.C. 2302), and employers), no training that is
suitable for the worker is available at a reasonable
cost, or no training funds are available.
(5) Weekly amounts.--The climate change adjustment
allowance payable to an adversely affected worker for a week of
unemployment shall be an amount equal to 70 percent of the
average weekly wage of such worker, but in no case shall such
amount exceed the average weekly wage for all workers in the
State where the adversely affected worker resides.
(6) Maximum duration of benefits.--An eligible worker may
receive a climate change adjustment allowance under this
subsection for a period of not longer than 156 weeks.
(b) Employment Services and Training.--
(1) Information and Employment Services.--The Secretary
shall make available, directly or through agreements with the
States under section 427(a) to adversely affected workers
covered by a certification under section 425(a) the following
information and employment services:
(A) Comprehensive and specialized assessment of
skill levels and service needs, including through--
(i) diagnostic testing and use of other
assessment tools; and
(ii) in-depth interviewing and evaluation
to identify employment barriers and appropriate
employment goals.
(B) Development of an individual employment plan to
identify employment goals and objectives, and
appropriate training to achieve those goals and
objectives.
(C) Information on training available in local and
regional areas, information on individual counseling to
determine which training is suitable training, and
information on how to apply for such training.
(D) Information on training programs and other
services provided by a State pursuant to title I of the
Workforce Investment Act of 1998 and available in local
and regional areas, information on individual
counseling to determine which training is suitable
training, and information on how to apply for such
training.
(E) Information on how to apply for financial aid,
including referring workers to educational opportunity
centers described in section 402F of the Higher
Education Act of 1965 (20 U.S.C. 1070a-16), where
applicable, and notifying workers that the workers may
request financial aid administrators at institutions of
higher education (as defined in section 102 of such Act
(20 U.S.C. 1002)) to use the administrators' discretion
under section 479A of such Act (20 U.S.C. 1087tt) to
use current year income data, rather than preceding
year income data, for determining the amount of need of
the workers for Federal financial assistance under
title IV of such Act (20 U.S.C. 1070 et seq.).
(F) Short-term prevocational services, including
development of learning skills, communications skills,
interviewing skills, punctuality, personal maintenance
skills, and professional conduct to prepare individuals
for employment or training.
(G) Individual career counseling, including job
search and placement counseling, during the period in
which the individual is receiving a climate change
adjustment allowance or training under this part, and
after receiving such training for purposes of job
placement.
(H) Provision of employment statistics information,
including the provision of accurate information
relating to local, regional, and national labor market
areas, including--
(i) job vacancy listings in such labor
market areas;
(ii) information on jobs skills necessary
to obtain jobs identified in job vacancy
listings described in subparagraph (A);
(iii) information relating to local
occupations that are in demand and earnings
potential of such occupations; and
(iv) skills requirements for local
occupations described in subparagraph (C).
(I) Information relating to the availability of
supportive services, including services relating to
child care, transportation, dependent care, housing
assistance, and need-related payments that are
necessary to enable an individual to participate in
training.
(2) Training.--
(A) Approval of and payment for training.--If the
Secretary determines, with respect to an adversely
affected worker that--
(i) there is no suitable employment (which
may include technical and professional
employment) available for an adversely affected
worker;
(ii) the worker would benefit from
appropriate training;
(iii) there is a reasonable expectation of
employment following completion of such
training;
(iv) training approved by the Secretary is
reasonably available to the worker from either
governmental agencies or private sources
(including area career and technical education
schools, as defined in section 3 of the Carl D.
Perkins Career and Technical Education Act of
2006, and employers);
(v) the worker is qualified to undertake
and complete such training; and
(vi) such training is suitable for the
worker and available at a reasonable cost,
the Secretary shall approve such training for the
worker. Upon such approval, the worker shall be
entitled to have payment of the costs of such training
(subject to the limitations imposed by this section)
paid on the worker's behalf by the Secretary directly
or through a voucher system.
(B) Distribution.--The Secretary shall establish
procedures for the distribution of the funds to States
to carry out the training programs approved under this
paragraph, and shall make an initial distribution of
the funds made available as soon as practicable after
the beginning of each fiscal year.
(C) Additional rules regarding approval of and
payment for training.--
(i) For purposes of applying subparagraph
(A)(iii), a reasonable expectation of
employment does not require that employment
opportunities for a worker be available, or
offered, immediately upon the completion of
training approved under such subparagraph.
(ii) If the costs of training an adversely
affected worker are paid by the Secretary under
subparagraph (A), no other payment for such
costs may be made under any other provision of
Federal law. No payment may be made under
subparagraph (A) of the costs of training an
adversely affected worker or an adversely
affected incumbent worker if such costs--
(I) have already been paid under
any other provision of Federal law; or
(II) are reimbursable under any
other provision of Federal law and a
portion of such costs have already been
paid under such other provision of
Federal law.
The provisions of this clause shall not apply
to, or take into account, any funds provided
under any other provision of Federal law which
are used for any purpose other than the direct
payment of the costs incurred in training a
particular adversely affected worker, even if
such use has the effect of indirectly paying or
reducing any portion of the costs involved in
training the adversely affected worker.
(D) Training programs.--The training programs that
may be approved under subparagraph (A) include--
(i) employer-based training, including--
(I) on-the-job training if approved
by the Secretary under subsection (c);
and
(II) joint labor-management
apprenticeship programs;
(ii) any training program provided by a
State pursuant to title I of the Workforce
Investment Act of 1998;
(iii) any training program approved by a
private industry council established under
section 102 of such Act;
(iv) any programs in career and technical
education described in section 3(5) of the Carl
D. Perkins Career and Technical Education Act
of 2006;
(v) any program of remedial education;
(vi) any program of prerequisite education
or coursework required to enroll in training
that may be approved under this paragraph;
(vii) any training program for which all,
or any portion, of the costs of training the
worker are paid--
(I) under any Federal or State
program other than this part; or
(II) from any source other than
this part;
(viii) any training program or coursework
at an accredited institution of higher
education (described in section 102 of the
Higher Education Act of 1965 (20 U.S.C. 1002)),
including a training program or coursework for
the purpose of--
(I) obtaining a degree or
certification; or
(II) completing a degree or
certification that the worker had
previously begun at an accredited
institution of higher education; and
(ix) any other training program approved by
the Secretary.
(3) Supplemental Assistance.--The Secretary may, as appropriate,
authorize supplemental assistance that is necessary to defray
reasonable transportation and subsistence expenses for separate
maintenance in a case in which training for a worker is provided in a
facility that is not within commuting distance of the regular place of
residence of the worker.
(c) On-the-Job Training Requirements.--
(1) In general.--The Secretary may approve on-the-job
training for any adversely affected worker if--
(A) the Secretary determines that on-the-job
training--
(i) can reasonably be expected to lead to
suitable employment with the employer offering
the on-the-job training;
(ii) is compatible with the skills of the
worker;
(iii) includes a curriculum through which
the worker will gain the knowledge or skills to
become proficient in the job for which the
worker is being trained; and
(iv) can be measured by benchmarks that
indicate that the worker is gaining such
knowledge or skills; and
(B) the State determines that the on-the-job
training program meets the requirements of clauses
(iii) and (iv) of subparagraph (A).
(2) Monthly payments.--The Secretary shall pay the costs of
on-the-job training approved under paragraph (1) in monthly
installments.
(3) Contracts for on-the-job training.--
(A) In general.--The Secretary shall ensure, in
entering into a contract with an employer to provide
on-the-job training to a worker under this subsection,
that the skill requirements of the job for which the
worker is being trained, the academic and occupational
skill level of the worker, and the work experience of
the worker are taken into consideration.
(B) Term of contract.--Training under any such
contract shall be limited to the period of time
required for the worker receiving on-the-job training
to become proficient in the job for which the worker is
being trained, but may not exceed 156 weeks in any
case.
(4) Exclusion of certain employers.--The Secretary shall
not enter into a contract for on-the-job training with an
employer that exhibits a pattern of failing to provide workers
receiving on-the-job training from the employer with--
(A) continued, long-term employment as regular
employees; and
(B) wages, benefits, and working conditions that
are equivalent to the wages, benefits, and working
conditions provided to regular employees who have
worked a similar period of time and are doing the same
type of work as workers receiving on-the-job training
from the employer.
(d) Administrative and Employment Services Funding.--
(1) Administrative funding.--In addition to any funds made
available to a State to carry out this section for a fiscal
year, the State shall receive for the fiscal year a payment in
an amount that is equal to 15 percent of the amount of such
funds and shall--
(A) use not more than \2/3\ of such payment for the
administration of the climate change adjustment
assistance for workers program under this part,
including for--
(i) processing waivers of training
requirements under subsection (a)(4);
(ii) collecting, validating, and reporting
data required under this part; and
(iii) administering the Climate Change
Adjustment Assistance Allowance payments; and
(B) use not less than \1/3\ of such payment for
information and employment services under subsection
(b)(1).
(2) Employment services funding.--
(A) In general.--In addition to any funds made
available to a State to carry out subsection (b)(2) and
the payment under paragraph (1) for a fiscal year, the
Secretary shall provide to the State for the fiscal
year a reasonable payment for the purpose of providing
employment and services under subsection (b)(1).
(B) Voluntary return of funds.--A State that
receives a payment under subparagraph (A) may decline
or otherwise return such payment to the Secretary.
(e) Job Search Allowances.--The Secretary of Labor may provide
adversely affected workers a one-time job search allowance in
accordance with regulations prescribed by the Secretary. Any job search
allowance provided shall be available only under the following
circumstances and conditions:
(1) The worker is no longer eligible for the climate change
adjustment allowance under subsection (a) and has completed the
training program required by subsection (a)(1)(E).
(2) The Secretary determines that the worker cannot
reasonably be expected to secure suitable employment in the
commuting area in which the worker resides.
(3) An allowance granted shall provide reimbursement to the
worker of all necessary job search expenses as prescribed by
the Secretary in regulations. Such reimbursement under this
subsection may not exceed $1,500 for any worker.
(f) Relocation Allowance Authorized.--
(1) In general.--Any adversely affected worker covered by a
certification issued under section 425 may file an application
for a relocation allowance with the Secretary, and the
Secretary may grant the relocation allowance, subject to the
terms and conditions of this subsection.
(2) Conditions for granting allowance.--A relocation
allowance may be granted if all of the following terms and
conditions are met:
(A) Assist an adversely affected worker.--The
relocation allowance will assist an adversely affected
worker in relocating within the United States.
(B) Local employment not available.--The Secretary
determines that the worker cannot reasonably be
expected to secure suitable employment in the commuting
area in which the worker resides.
(C) Total separation.--The worker is totally
separated from employment at the time relocation
commences.
(D) Suitable employment obtained.--The worker--
(i) has obtained suitable employment
affording a reasonable expectation of long-term
duration in the area in which the worker wishes
to relocate; or
(ii) has obtained a bona fide offer of such
employment.
(E) Application.--The worker filed an application
with the Secretary at such time and in such manner as
the Secretary shall specify by regulation.
(3) Amount of allowance.--The relocation allowance granted
to a worker under paragraph (1) includes--
(A) all reasonable and necessary expenses
(including, subsistence and transportation expenses at
levels not exceeding amounts prescribed by the
Secretary in regulations) incurred in transporting the
worker, the worker's family, and household effects; and
(B) a lump sum equivalent to 3 times the worker's
average weekly wage, up to a maximum payment of $1,500.
(4) Limitations.--A relocation allowance may not be granted
to a worker unless--
(A) the relocation occurs within 182 days after the
filing of the application for relocation assistance; or
(B) the relocation occurs within 182 days after the
conclusion of training, if the worker entered a
training program approved by the Secretary under
subsection (b)(2).
(g) Health Insurance Continuation.--Not later than 1 year after the
date of enactment of this part, the Secretary of Labor shall prescribe
regulations to provide, for the period in which an adversely affected
worker is participating in a training program described in subsection
(b)(2), 80 percent of the monthly premium of any health insurance
coverage that an adversely affected worker was receiving from such
worker's employer prior to the separation from employment described in
section 425(b), to be paid to any health care insurance plan designated
by the adversely affected worker receiving an allowance under this
section.
SEC. 427. GENERAL PROVISIONS.
(a) Agreements With States.--
(1) In general.--The Secretary is authorized on behalf of
the United States to enter into an agreement with any State, or
with any State agency (referred to in this section as
``cooperating States'' and ``cooperating States agencies''
respectively). Under such an agreement, the cooperating State
agency--
(A) as agent of the United States, shall receive
applications for, and shall provide, payments on the
basis provided in this part;
(B) in accordance with paragraph (6), shall make
available to adversely affected workers covered by a
certification under section 425(d) the employment
services described in section 426(b)(1);
(C) shall make any certifications required under
section 425(d);
(D) shall otherwise cooperate with the Secretary
and with other State and Federal agencies in providing
payments and services under this part.
Each agreement under this section shall provide the terms and
conditions upon which the agreement may be amended, suspended,
or terminated.
(2) Form and manner of data.--Each agreement under this
section shall--
(A) provide the Secretary with the authority to
collect any data the Secretary determines necessary to
meet the requirements of this part; and
(B) specify the form and manner in which any such
data requested by the Secretary shall be reported.
(3) Relationship to unemployment insurance.--Each agreement
under this section shall provide that an adversely affected
worker receiving a climate change adjustment allowance under
this part shall not be eligible for unemployment insurance
otherwise payable to such worker under the laws of the State.
(4) Review.--A determination by a cooperating State agency
with respect to entitlement to program benefits under an
agreement is subject to review in the same manner and to the
same extent as determinations under the applicable State law
and only in that manner and to that extent.
(5) Coordination.--Any agreement entered into under this
section shall provide for the coordination of the
administration of the provisions for employment services,
training, and supplemental assistance under section 426 and
under title I of the Workforce Investment Act of 1998 upon such
terms and conditions as are established by the Secretary in
consultation with the States and set forth in such agreement.
Any agency of the State jointly administering such provisions
under such agreement shall be considered to be a cooperating
State agency for purposes of this part.
(6) Responsibilities of cooperating agencies.--Each
cooperating State agency shall, in carrying out paragraph
(1)(B)--
(A) advise each worker who applies for unemployment
insurance of the benefits under this part and the
procedures and deadlines for applying for such
benefits;
(B) facilitate the early filing of petitions under
section 425(a) for any workers that the agency
considers are likely to be eligible for benefits under
this part;
(C) advise each adversely affected worker to apply
for training under section 426(b) before, or at the
same time, the worker applies for climate change
adjustment allowances under section 426(a);
(D) perform outreach to, intake of, and orientation
for adversely affected workers and adversely affected
incumbent workers covered by a certification under
section 426(a) with respect to assistance and benefits
available under this part;
(E) make employment services described in section
426(b)(1) available to adversely affected workers and
adversely affected incumbent workers covered by a
certification under section 425(d) and, if funds
provided to carry out this part are insufficient to
make such services available, make arrangements to make
such services available through other Federal programs;
and
(F) provide the benefits and reemployment services
under this part in a manner that is necessary for the
proper and efficient administration of this part,
including the use of state agency personnel employed in
accordance with a merit system of personnel
administration standards, including--
(i) making determinations of eligibility
for, and payment of, climate change
readjustment allowances and health care benefit
replacement amounts;
(ii) developing recommendations regarding
payments as a bridge to retirement and lump sum
payments to pension plans in accordance with
this subsection; and
(iii) the provision of reemployment
services to eligible workers, including
referral to training services.
(7) In order to promote the coordination of workforce
investment activities in each State with activities carried out
under this part, any agreement entered into under this section
shall provide that the State shall submit to the Secretary, in
such form as the Secretary may require, the description and
information described in paragraphs (8) and (14) of section
112(b) of the Workforce Investment Act of 1998 (29 U.S.C.
2822(b)) and a description of the State's rapid response
activities under section 221(a)(2)(A).
(8) Control measures.--
(A) In general.--The Secretary shall require each
cooperating State and cooperating State agency to
implement effective control measures and to effectively
oversee the operation and administration of the climate
change adjustment assistance program under this part,
including by means of monitoring the operation of
control measures to improve the accuracy and timeliness
of the data being collected and reported.
(B) Definition.--For purposes of subparagraph (A),
the term ``control measures'' means measures that--
(i) are internal to a system used by a
State to collect data; and
(ii) are designed to ensure the accuracy
and verifiability of such data.
(9) Data reporting.--
(A) In general.--Any agreement entered into under
this section shall require the cooperating State or
cooperating State agency to report to the Secretary on
a quarterly basis comprehensive performance
accountability data, to consist of--
(i) the core indicators of performance
described in subparagraph (B)(i);
(ii) the additional indicators of
performance described in subparagraph (B)(ii),
if any; and
(iii) a description of efforts made to
improve outcomes for workers under the climate
change adjustment assistance program.
(B) Core indicators described.--
(i) In general.--The core indicators of
performance described in this subparagraph
are--
(I) the percentage of workers
receiving benefits under this part who
are employed during the second calendar
quarter following the calendar quarter
in which the workers cease receiving
such benefits;
(II) the percentage of such workers
who are employed in each of the third
and fourth calendar quarters following
the calendar quarter in which the
workers cease receiving such benefits;
and
(III) the earnings of such workers
in each of the third and fourth
calendar quarters following the
calendar quarter in which the workers
cease receiving such benefits.
(ii) Additional indicators.--The Secretary
and a cooperating State or cooperating State
agency may agree upon additional indicators of
performance for the climate change adjustment
assistance program under this part, as
appropriate.
(C) Standards with respect to reliability of
data.--In preparing the quarterly report required by
subparagraph (A), each cooperating State or cooperating
State agency shall establish procedures that are
consistent with guidelines to be issued by the
Secretary to ensure that the data reported are valid
and reliable.
(10) Verification of eligibility for program benefits.--
(A) In general.--An agreement under this section
shall provide that the State shall periodically
redetermine that a worker receiving benefits under this
part who is not a citizen or national of the United
States remains in a satisfactory immigration status.
Once satisfactory immigration status has been initially
verified through the immigration status verification
system described in section 1137(d) of the Social
Security Act (42 U.S.C. 1320b-7(d)) for purposes of
establishing a worker's eligibility for unemployment
compensation, the State shall reverify the worker's
immigration status if the documentation provided during
initial verification will expire during the period in
which that worker is potentially eligible to receive
benefits under this part. The State shall conduct such
redetermination in a timely manner, utilizing the
immigration status verification system described in
section 1137(d) of the Social Security Act (42 U.S.C.
1320b-7(d)).
(B) Procedures.--The Secretary shall establish
procedures to ensure the uniform application by the
States of the requirements of this paragraph.
(b) Administration Absent State Agreement.--
(1) In any State where there is no agreement in force
between a State or its agency under subsection (a), the
Secretary shall promulgate regulations for the performance of
all necessary functions under section 426, including provision
for a fair hearing for any worker whose application for
payments is denied.
(2) A final determination under paragraph (1) with respect
to entitlement to program benefits under section 426 is subject
to review by the courts in the same manner and to the same
extent as is provided by section 205(g) of the Social Security
Act (42 U.S.C. 405(g)).
(c) Prohibition on Contracting With Private Entities.--Neither the
Secretary nor a State may contract with any private for-profit or
nonprofit entity for the administration of the climate change
adjustment assistance program under this part.
(d) Payment to the States.--
(1) In general.--The Secretary shall from time to time
certify to the Secretary of the Treasury for payment to each
cooperating State the sums necessary to enable such State as
agent of the United States to make payments provided for by
this part.
(2) Restriction.--All money paid a State under this
subsection shall be used solely for the purposes for which it
is paid; and money so paid which is not used for such purposes
shall be returned, at the time specified in the agreement under
this section, to the Secretary of the Treasury.
(3) Bonds.--Any agreement under this section may require
any officer or employee of the State certifying payments or
disbursing funds under the agreement or otherwise participating
in the performance of the agreement, to give a surety bond to
the United States in such amount as the Secretary may deem
necessary, and may provide for the payment of the cost of such
bond from funds for carrying out the purposes of this part.
(e) Labor Standards.--
(1) Prohibition on displacement.--An individual in an
apprenticeship program or on-the-job training program under
this part shall not displace (including a partial displacement,
such as a reduction in the hours of non-overtime work, wages,
or employment benefits) any employed employee.
(2) Prohibition on impairment of contracts.--An
apprenticeship program or on-the-job raining program under this
Act shall not impair an existing contract for services or
collective bargaining agreement, and no such activity that
would be inconsistent with the terms of a collective bargaining
agreement shall be undertaken without the written concurrence
of the labor organization and employer concerned.
(3) Additional standards.--The Secretary, or a State acting
under an agreement described in subsection (a) may pay the
costs of on-the-job training, notwithstanding any other
provision of this section, only if--
(A) in the case of training which would be
inconsistent with the terms of a collective bargaining
agreement, the written concurrence of the labor
organization concerned has been obtained;
(B) the job for which such adversely affected
worker is being trained is not being created in a
promotional line that will infringe in any way upon the
promotional opportunities of currently employed
individuals;
(C) such training is not for the same occupation
from which the worker was separated and with respect to
which such worker's group was certified pursuant to
section 425(d);
(D) the employer is provided reimbursement of not
more than 50 percent of the wage rate of the
participant, for the cost of providing the training and
additional supervision related to the training; and
(E) the employer has not received payment under
with respect to any other on-the-job training provided
by such employer which failed to meet the requirements
of subparagraphs (A) through (D).
(f) Definitions.--As used in this part the following definitions
apply:
(1) The term ``adversely affected employment'' means
employment at an employment site, if workers at such site are
eligible to apply for adjustment assistance under this part.
(2) The term ``adversely affected worker'' means an
individual who has been totally or partially separated from
employment and is eligible to apply for adjustment assistance
under this part.
(3) The term ``average weekly wage'' means \1/13\ of the
total wages paid to an individual in the quarter in which the
individual's total wages were highest among the first 4 of the
last 5 completed calendar quarters immediately before the
quarter in which occurs the week with respect to which the
computation is made. Such week shall be the week in which total
separation occurred, or, in cases where partial separation is
claimed, an appropriate week, as defined in regulations
prescribed by the Secretary.
(4) The term ``average weekly hours'' means the average
hours worked by the individual (excluding overtime) in the
employment from which he has been or claims to have been
separated in the 52 weeks (excluding weeks during which the
individual was sick or on vacation) preceding the week
specified in the last sentence of paragraph (4).
(5) The term ``benefit period'' means, with respect to an
individual--
(A) the benefit year and any ensuing period, as
determined under applicable State law, during which the
individual is eligible for regular compensation,
additional compensation, or extended compensation; or
(B) the equivalent to such a benefit year or
ensuing period provided for under the applicable
Federal unemployment insurance law.
(6) The term ``consumer goods manufacturing'' means the
electrical equipment, appliance, and component manufacturing
industry and transportation equipment manufacturing.
(7) The term ``employment site'' means a single facility or
site of employment.
(8) The term ``energy-intensive manufacturing industries''
means all industrial sectors, entities, or groups of entities
that meet the energy or greenhouse gas intensity criteria in
section 765(b)(2)(A)(i) of the Clean Air Act based on the most
recent data available.
(9) The term ``energy producing and transforming
industries'' means the coal mining industry, oil and gas
extraction, electricity power generation, transmission and
distribution, and natural gas distribution.
(10) The term ``industries dependent on energy industries''
means rail transportation and pipeline transportation.
(11) The term ``on-the-job training'' means training
provided by an employer to an individual who is employed by the
employer.
(12) The terms ``partial separation'' and ``partially
separated'' refer, with respect to an individual who has not
been totally separated, that such individual has had--
(A) his or her hours of work reduced to 80 percent
or less of his average weekly hours in adversely
affected employment; and
(B) his or her wages reduced to 80 percent or less
of his average weekly wage in such adversely affected
employment.
(13) The term ``public agency'' means a department or
agency of a State or political subdivision of a State or of the
Federal Government.
(14) The term ``Secretary'' means the Secretary of Labor.
(15) The term ``service workers'' means workers supplying
support or auxiliary services to an employment site.
(16) The term ``State agency'' means the agency of the
State which administers the State law.
(17) The term ``State law'' means the unemployment
insurance law of the State approved by the Secretary of Labor
under section 3304 of the Internal Revenue Code of 1954.
(18) The terms ``total separation'' and ``totally
separated'' refer to the layoff or severance of an individual
from employment with an employer in which adversely affected
employment exists.
(19) The term ``unemployment insurance'' means the
unemployment compensation payable to an individual under any
State law or Federal unemployment compensation law, including
chapter 85 of title 5, United States Code, and the Railroad
Unemployment Insurance Act. The terms ``regular compensation'',
``additional compensation'', and ``extended compensation'' have
the same respective meanings that are given them in section
205(2), (3), and (4) of the Federal-State Extended Unemployment
Compensation Act of 1970 (26 U.S.C. 3304 note).
(20) The term ``week'' means a week as defined in the
applicable State law.
(21) The term ``week of unemployment'' means a week of
total, part-total, or partial unemployment as determined under
the applicable State law or Federal unemployment insurance law.
(g) Special Rule With Respect to Military Service.--
(1) In general.--Notwithstanding any other provision of
this part, the Secretary may waive any requirement of this part
that the Secretary determines is necessary to ensure that an
adversely affected worker who is a member of a reserve
component of the Armed Forces and serves a period of duty
described in paragraph (2) is eligible to receive a climate
change adjustment allowance, training, and other benefits under
this part in the same manner and to the same extent as if the
worker had not served the period of duty.
(2) Period of duty described.--An adversely affected worker
serves a period of duty described in this paragraph if, before
completing training under this part, the worker--
(A) serves on active duty for a period of more than
30 days under a call or order to active duty of more
than 30 days; or
(B) in the case of a member of the Army National
Guard of the United States or Air National Guard of the
United States, performs full-time National Guard duty
under section 502(f) of title 32, United States Code,
for 30 consecutive days or more when authorized by the
President or the Secretary of Defense for the purpose
of responding to a national emergency declared by the
President and supported by Federal funds.
(h) Fraud and Recovery of Overpayments.--
(1) Recovery of payments to which an individual was not
entitled.--If the Secretary or a court of competent
jurisdiction determines that any person has received any
payment under this part to which the individual was not
entitled, such individual shall be liable to repay such amount
to the Secretary, as the case may be, except that the Secretary
shall waive such repayment if such agency or the Secretary
determines that--
(A) the payment was made without fault on the part
of such individual; and
(B) requiring such repayment would cause a
financial hardship for the individual (or the
individual's household, if applicable) when taking into
consideration the income and resources reasonably
available to the individual (or household) and other
ordinary living expenses of the individual (or
household).
(2) Means of recovery.--Unless an overpayment is otherwise
recovered, or waived under paragraph (1), the Secretary shall
recover the overpayment by deductions from any sums payable to
such person under this part, under any Federal unemployment
compensation law or other Federal law administered by the
Secretary which provides for the payment of assistance or an
allowance with respect to unemployment. Any amount recovered
under this section shall be returned to the Treasury of the
United States.
(i) Regulations.--The Secretary shall prescribe such regulations as
may be necessary to carry out the provisions of this part.
(j) Study on Older Workers.--The Secretary shall conduct a study
examine the circumstances of older adversely affected workers and the
ability of such workers to access their retirement benefits. The
Secretary shall transmit a report to Congress not later than 2 years
after the date of enactment of this part on the findings of the study
and the Secretary's recommendations on how to ensure that adversely
affected workers within 2 years of retirement are able to access their
retirement benefits.
(k) Spending Limit.--For each fiscal year, the total amount of
funds disbursed for the purposes described in section 426 shall not
exceed the amount deposited in that fiscal year into the Climate Change
Worker Assistance Fund established under section 782(j) of the Clean
Air Act. The annual spending limit for any succeeding year shall be
increased by the difference, if any, between the amount of the prior
year's disbursements and the spending limitation for that year. The
Secretary shall promulgate rules to ensure that this spending limit is
not exceeded. Such rules shall provide that workers who receive any of
the benefits described in section 426 receive full benefits, and shall
include the establishment of a waiting list for workers in the event
that the requests for assistance exceed the spending limit.
Subtitle C--Consumer Assistance
SEC. 431. ENERGY REFUND PROGRAM.
The Social Security Act (42 U.S.C. 201 et seq.) is amended by
adding at the end the following:
``TITLE XXII--ENERGY REFUND PROGRAM
``SEC. 2201. ENERGY REFUND PROGRAM.
``(a) In General.--The Secretary shall formulate and administer the
program provided for in this section, which shall be known as the
`Energy Refund Program', and under which eligible low-income households
are provided cash payments to reimburse the households for the
estimated loss in their purchasing power resulting from the American
Clean Energy and Security Act of 2009.
``(b) Entitlement of Eligible Households to Cash Payments.--At the
request of the State agency of a State, each eligible low-income
household in the State shall be entitled to receive monthly cash
payments under this section in an amount equal to the monthly energy
refund amount determined under subsection (d).
``(c) Eligibility.--
``(1) Eligible households.--A household shall be considered
to be an eligible low-income household for purposes of this
section if--
``(A) the gross income of the household does not
exceed the greater of--
``(i) 150 percent of the poverty line; or
``(ii) the greatest amount of household
gross income in respect of which a benefit
could be payable under subsection (d)(2)(B);
``(B) the State agency of the State in which the
household is located determines that the household is
participating in--
``(i) the Supplemental Nutrition Assistance
Program authorized by the Food and Nutrition
Act of 2008 (7 U.S.C. 2011 et seq.);
``(ii) the Food Distribution Program on
Indian Reservations authorized by section 4(b)
of such Act (7 U.S.C. 2013(b)); or
``(iii) the program for nutrition
assistance in Puerto Rico or American Samoa
under section 19 of such Act (7 U.S.C. 2028);
``(C) the household consists of a single individual
or a married couple, and--
``(i) receives the subsidy described in
section 1860D-14 of this Act (42 U.S.C. 1395w-
114); or
``(ii)(I) participates in the program under
title XVIII of this Act; and
``(II) meets the income requirements
described in section 1860D-14(a)(1) or (a)(2)
of this Act (42 U.S.C. 1395w-114(a)(1) or
(a)(2)); or
``(D) the household consists of a single individual
or a married couple, and receives benefits under the
supplemental security income program under title XVI of
this Act (42 U.S.C. 1381-1383f).
``(2) Streamlined participation for certain
beneficiaries.--The Secretary shall--
``(A) periodically estimate the number of eligible
beneficiaries and households, and the number of
participating beneficiaries and households, for the
Energy Refund Program; and
``(B) develop procedures, in consultation with the
Commissioner of Social Security, the Railroad
Retirement Board, the Secretary of Veterans Affairs,
and the State agencies, to ensure that low-income
beneficiaries of the benefit programs administered by
such entities receive the energy refund for which the
beneficiaries are eligible under the Energy Refund
Program.
``(3) Limitation.--Notwithstanding any other provision of
law, the Secretary shall provide refunds to United States
citizens, United States nationals, and individuals lawfully
residing in the United States who qualify for a refund under
paragraph (1)(A), and shall establish procedures to ensure that
other individuals do not receive refunds.
``(4) National standards.--The Secretary shall consult with
the Secretary of Agriculture and establish uniform national
standards of eligibility ensuring that States may seamlessly
co-administer the energy refund program with the Supplemental
Nutrition Assistance Program in accordance with the provisions
of this section. No State agency shall impose any other
standard or requirement as a condition of eligibility or refund
receipt under the program. Assistance in the Energy Refund
Program shall be furnished promptly to all eligible households
who make application for such participation or are already
enrolled in any program referred to in paragraph (1).
``(d) Monthly Energy Refund Amount.--
``(1) Estimated annual total loss in purchasing power.--Not
later than August 31 of each fiscal year, the Energy
Information Administration shall estimate the annual total loss
in purchasing power that will result from American Clean Energy
and Security Act of 2009 in the next fiscal year for households
of each size with gross income equal to 150 percent of the
poverty line, based on the projected total market value of all
compliance costs (including, but not limited to, the emissions
allowances used to demonstrate compliance with title VII of the
Clean Air Act in the next fiscal year, and excluding costs that
are not projected to be incurred by households as a result of
allowances freely allocated and intended for residential
consumer assistance pursuant to sections 783 through 785 of the
Clean Air Act), in a way generally recognized as suitable by
experts.
``(2) Monthly energy refund.--The monthly energy refund
amount for an eligible household under this section shall be--
``(A) if the gross income of the household does not
exceed 150 percent of the poverty line applicable to
the household--
``(i) if the household has 1, 2, 3, or 4
members, \1/12\ of the amount estimated under
paragraph (1) for a household of the same size,
rounded to the nearest whole dollar amount; or
``(ii) if the household has 5 or more
members, \1/12\ of the arithmetic mean value of
the amounts estimated under paragraph (1) for
households with 5 or more members, rounded to
the nearest whole dollar amount; or
``(B) if the gross income of the household exceeds
150 percent of the poverty line applicable to the
household, \1/12\ of the amount (if any) by which--
``(i) the amount estimated under paragraph
(1) for a household of the same size; exceeds
``(ii) 20 percent of the amount by which
the gross income of the household exceeds 150
percent of the poverty line.
``(e) Delivery Mechanism.--
``(1) Subject to standards and an implementation schedule
set by the Secretary, the energy refund shall be provided in
monthly installments via--
``(A) direct deposit into the eligible household's
designated bank account;
``(B) the State's electronic benefit transfer
system; or
``(C) another Federal or State mechanism, if such a
mechanism is approved by the Secretary.
``(2) Such standards shall include--
``(A)(i) defining the required level of recipient
protection regarding privacy;
``(ii) guidance on how recipients are offered
choices, when relevant, about the delivery mechanism;
``(iii) guidance on ease of use and access to the
refund, including the prohibition of fees charged to
recipients for withdrawals or other services; and
``(iv) cost-effective protections against improper
accessing of the energy refund;
``(B) operating standards that provide for
interoperability between States and law enforcement
monitoring; and
``(C) other standards, as determined by the
Secretary or the Secretary's designee.
``(f) Administration.--
``(1) In general.--The State agency of each participating
State shall assume responsibility for the certification of
applicant households and for the issuance of refunds and the
control and accountability thereof.
``(2) Procedures.--Under standards established by the
Secretary, the State agency shall establish procedures
governing the administration of the Energy Refund Program that
the State agency determines best serve households in the State,
including households with special needs, such as households
with elderly or disabled members, households in rural areas,
homeless individuals, and households residing on reservations
as defined in the Indian Child Welfare Act of 1978 and the
Indian Financing Act of 1974. In carrying out this paragraph, a
State agency--
``(A) shall provide timely, accurate, and fair
service to applicants for, and participants in, the
Energy Refund Program;
``(B) shall permit an applicant household to apply
to participate in the program at the time that the
household first contacts the State agency, and shall
consider an application that contains the name,
address, and signature of the applicant to be
sufficient to constitute an application for
participation;
``(C) shall screen any applicant household for the
Supplemental Nutrition Assistance Program, the State's
medical assistance program under section XIX of this
Act, State Childrens Health Insurance Program under
section XXI of this Act, and a State program that
provides basic assistance under a State program funded
under title IV of this Act or with qualified State
expenditures as defined in section 409(a)(7) of this
Act for eligibility for the Energy Refund Program and,
if eligible, shall enroll such applicant household in
the Energy Refund Program;
``(D) shall complete certification of and provide a
refund to any eligible household not later than 30 days
following its filing of an application;
``(E) shall use appropriate bilingual personnel and
materials in the administration of the program in those
portions of the State in which a substantial number of
members of low-income households speak a language other
than English; and
``(F) shall utilize State agency personnel who are
employed in accordance with the current standards for a
Merit System of Personnel Administration or any
standards later prescribed by the Office of Personnel
Management pursuant to section 208 of the
Intergovernmental Personnel Act of 1970 (42 U.S.C.
4728) modifying or superseding such standards relating
to the establishment and maintenance of personnel
standards on a merit basis to make all tentative and
final determinations of eligibility and ineligibility.
``(3) Regulations.--
``(A) Except as provided in subparagraph (B), the
Secretary shall issue such regulations consistent with
this section as the Secretary deems necessary or
appropriate for the effective and efficient
administration of the Energy Refund Program, and shall
promulgate all such regulations in accordance with the
procedures set forth in section 553 of title 5, United
States Code.
``(B) Without regard to section 553 of title 5 of
such Code, the Administrator may by rule promulgate as
final, to be effective until no later than 2 years
after the date of the enactment of the American Clean
Energy and Security Act of 2009, any procedures that
are substantially the same as the procedures governing
the Supplemental Nutrition Assistance Program in
section 273.2, 273.12, or 273.15 of title 7, Code of
Federal Regulations.
``(C) Notwithstanding subsection (i)(4), the
Secretary may promulgate regulations allowing for
streamlined eligibility determinations for some or all
households which include individuals receiving
assistance under a State plan approved under title XIX
or XXI of this Act. The regulations may institute
procedures whereby the income and family size
information used for determining eligibility under such
title XIX or XXI may be the basis for determining
eligibility for the Energy Refund Program.
``(D) Notwithstanding any other provision of this
section, the Secretary may authorize States to provide
benefits under this section on a quarterly basis if the
Secretary determines that the amount of the benefits
that would be provided on a monthly basis to households
is insufficient to be efficiently paid on a monthly
basis in light of the administrative expenses of the
Energy Refund Program.
``(g) Treatment.--The value of the refund provided under this
section shall not be considered income or resources for any purpose
under any Federal, State, or local laws, including, but not limited to,
laws relating to an income tax, or public assistance programs
(including, but not limited to, health care, cash aid, child care,
nutrition programs, and housing assistance) and no participating State
or political subdivision thereof shall decrease any assistance
otherwise provided an individual or individuals because of the receipt
of a refund under this section.
``(h) Program Integrity.--For purposes of ensuring program
integrity and complying with the requirements of the Improper Payment
Information Act of 2002, the Secretary shall, to the maximum extent
possible, rely on and coordinate with the quality control sample and
review procedures of paragraphs (2), (3), (4), and (5) of section 16(c)
of the Food and Nutrition Act of 2008 (7 U.S.C. 2025(c)).
``(i) Definitions.--
``(1) Secretary.--The term `Secretary' means the Secretary
of Health and Human Services or the head of another agency
designated by the Secretary of Health and Human Services.
``(2) Electronic benefit transfer system.--The term
`electronic benefit transfer system' means a system by which
household benefits or refunds defined under subsection (e) are
issued from and stored in a central databank via electronic
benefit transfer cards.
``(3) Gross income.--The term `gross income' means the
gross income of a household that is determined in accordance
with standards and procedures established under section 5 of
the Food and Nutrition Act of 2008 (7 U.S.C. 2014) and its
implementing regulations.
``(4) Household.--
``(A) The term `household' means--
``(i) in subparagraphs (A) and (B) of
subsection (c)(1) of this section, except as
provided in subparagraph (C) of this paragraph,
an individual or a group of individuals who are
a household under section 3(n) of the Food and
Nutrition Act of 2008 (7 U.S.C. 2012(n));
``(ii) in subsection (c)(1)(C) of this
section, a single individual or married couple
that receives benefits under section 1860D-14
of this Act (42 U.S.C. 1395w-114); and
``(iii) in subsection (c)(1)(D) of this
section, a single individual or married couple
that receives benefits under the supplemental
security income program under title XVI of this
Act (42 U.S.C. 1381-1383f).
``(B) The Secretary shall establish rules for
providing the energy refund in an equitable and
administratively simple manner to households where the
group of individuals who live together includes members
not all of whom are described in a single clause of
subparagraph (A), or includes additional members not
described in any such clause.
``(C) The Secretary shall establish rules regarding
the eligibility and delivery of the energy refund to
groups of individuals described in section 3(n)(4) or
(5) of the Food and Nutrition Act of 2008 (7 U.S.C.
2012(n)).
``(5) Poverty line.--The term `poverty line' has the
meaning given the term in section 673(2) of the Community
Services Block Grant Act (42 U.S.C. 9902(2)), including any
revision required by that section.
``(6) State.--The term `State' means the 50 States, the
District of Columbia, the Commonwealth of Puerto Rico, American
Samoa, the United States Virgin Islands, Guam, and the
Commonwealth of the Northern Mariana Islands.
``(7) State agency.--The term `State agency' means an
agency of State government, including the local offices
thereof, that has responsibility for administration of the 1 or
more federally aided public assistance programs within the
State, and in those States where such assistance programs are
operated on a decentralized basis, the term shall include the
counterpart local agencies administering such programs.
``(8) Other terms.--Other terms not defined in this title
shall have the same meaning applied in the Supplemental
Nutrition Assistance Program authorized by the Food and
Nutrition Act of 2008 (7 U.S.C. 2011 et seq.) unless the
Secretary finds for good cause that application of a particular
definition would be detrimental to the purposes of the Energy
Refund Program.''.
SEC. 432. MODIFICATION OF EARNED INCOME CREDIT AMOUNT FOR INDIVIDUALS
WITH NO QUALIFYING CHILDREN.
(a) In General.--Subsection (b) of section 32 of the Internal
Revenue Code of 1986 is amended by adding at the end the following new
paragraph:
``(4) Special rule for individuals with no qualifying
children who are affected by the american clean energy and
security act of 2009.--
``(A) In general.--In the case of any household
which the Secretary determines experienced a reduction
in purchasing power as a result of the provisions of,
or amendments made by, the American Clean Energy and
Security Act of 2009 (determined without regard to this
paragraph and section 2201 of the Social Security
Act)--
``(i) Increase in credit percentage and
phaseout percentage.--The table contained in
paragraph (1)(A) shall be applied by
substituting `15.3' for `7.65'.
``(ii) Increase in beginning phaseout
amount.--The table contained in paragraph
(2)(A) shall be applied by substituting
`$11,640' for `$5,280'.
``(B) Inflation adjustment.--
``(i) In general.--In the case of any
taxable year beginning after 2012, the $11,640
amount in subparagraph (A)(ii) shall be
increased by an amount equal to--
``(I) such dollar amount,
multiplied by
``(II) the cost of living
adjustment determined under section
1(f)(3) for the calendar year in which
the taxable year begins determined by
substituting `calendar year 2011' for
`calendar year 1992' in subparagraph
(B) thereof.
``(ii) Rounding.--Subparagraph (A) of
subsection (j)(2) shall apply after taking into
account any increase under clause (i) in the
same manner as if such increase were under
paragraph (1) of subsection (j).
``(iii) Coordination with other inflation
adjustments.--Paragraph (1) of subsection (j)
shall not apply to the dollar amount
substituted under subparagraph (A)(ii).''.
(b) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after December 31, 2011.
SEC. 433. PROTECTION OF SOCIAL SECURITY AND MEDICARE TRUST FUNDS.
(a) OASDI Trust Funds.--Section 201 of the Social Security Act (42
U.S.C. 401) is amended by adding at the end the following new
subsection:
``(o) The Secretary of the Treasury shall transfer from time to
time to the Federal Old-Age and Survivors Insurance Trust Fund and the
Federal Disability Insurance Trust Fund, from amounts in the general
fund of the Treasury that are not otherwise appropriated, such sums as
the Chief Actuary of the Social Security Administration calculates as
necessary (and so certifies to such Secretary) for any fiscal year, on
account of changes in benefit costs and changes in tax revenue
attributable to the provisions of the American Clean Energy and
Security Act of 2009 and the amendments made thereby, in order to place
each of such Trust Funds in the same position at the end of such fiscal
year as the position in which such Trust Fund would have been if such
changes had not occurred.''.
(b) HI Trust Fund.--Section 1817 of such Act (42 U.S.C. 1395i) is
amended by adding at the end the following new subsection:
``(l) Transfers to Account for Changes in Benefit Costs and Changes
in Tax Revenue Attributable to the American Clean Energy and Security
Act of 2009.--The Secretary of the Treasury shall transfer from time to
time to the Trust Fund, from amounts in the general fund of the
Treasury that are not otherwise appropriated, such sums as the Chief
Actuary of the Centers for Medicare & Medicaid Services calculates as
necessary (and so certifies to such Secretary) for any fiscal year, on
account of changes in benefit costs and changes in tax revenue
attributable to the provisions of the American Clean Energy and
Security Act of 2009 and the amendments made thereby, in order to place
the Trust Fund in the same position at the end of such fiscal year as
the position in which it would have been if such changes had not
occurred.''.
Subtitle D--Exporting Clean Technology
SEC. 441. FINDINGS AND PURPOSES.
(a) Findings.--Congress finds the following:
(1) Protecting Americans from the impacts of climate change
requires global reductions in greenhouse gas emissions.
(2) Although developing countries are historically least
responsible for the cumulative greenhouse gas emissions that
are causing climate change and continue to have very low per
capita greenhouse gas emissions, their overall greenhouse gas
emissions are increasing as they seek to grow their economies
and reduce energy poverty for their populations.
(3) Many developing countries lack the financial and
technical resources to adopt clean energy technologies and
absent assistance their greenhouse gas emissions will continue
to increase.
(4) Investments in clean energy technology cooperation can
substantially reduce global greenhouse gas emissions while
providing developing countries with incentives to adopt
policies that will address competitiveness concerns related to
regulation of United States greenhouse gas emissions.
(5) Investments in clean technology in developing countries
will increase demand for clean energy products, open up new
markets for United States companies, spur innovation, and lower
costs.
(6) Under Article 4 of the United Nations Framework
Convention on Climate Change, developed country parties,
including the United States, committed to ``take all
practicable steps to promote, facilitate, and finance, as
appropriate, the transfer of, or access to, environmentally
sound technologies and know-how to other parties, particularly
developing country parties, to enable them to implement the
provisions of the Convention''.
(7) Under the Bali Action Plan, developed country parties
to the United Nations Framework Convention on Climate Change,
including the United States, committed to ``enhanced action on
the provision of financial resources and investment to support
action on mitigation and adaptation and technology
cooperation,'' including, inter alia, consideration of
``improved access to adequate, predictable, and sustainable
financial resources and financial and technical support, and
the provision of new and additional resources, including
official and concessional funding for developing country
parties''.
(8) Intellectual property rights are a key driver of
investment and research and development in, and the global
deployment of, clean technologies.
(9) Innovative clean technologies, including U.S. and
multilateral financing mechanisms for their deployment, are
critical to mitigating global warming pollution, preventing
catastrophic changes to the climate, and developing robust
economies around the world.
(10) Any weakening of intellectual property rights
protection poses a substantial competitive risk to U.S.
companies and the creation of high-quality U.S. jobs,
inhibiting the creation of new ``green'' employment and the
transformational shift to the ``Green Economy'' of the 21st
Century.
(11) Any U.S. funding directed toward assisting developing
countries with regard to exporting clean technology should
promote the robust compliance with and enforcement of existing
international legal requirements for the protection of
intellectual property rights as formulated in the Agreement on
Trade-Related Aspects of Intellectual Property Rights, referred
to in section 101(d)(15) of the Uruguay Round Agreements Act
(19 U.S.C.3511(d)(15) and in applicable intellectual property
provisions of bilateral trade agreements.
(b) Purposes.--The purposes of this subtitle are--
(1) to provide United States assistance and leverage
private resources to encourage widespread implementation, in
developing countries, of activities that reduce, sequester, or
avoid greenhouse gas emissions; and
(2) to provide such assistance in a manner that--
(A) encourages such countries to adopt policies and
measures, including sector-based and cross-sector
policies and measures, that substantially reduce,
sequester, or avoid greenhouse gas emissions;
(B) promotes the successful negotiation of a global
agreement to reduce greenhouse gas emissions under the
United Nations Framework Convention on Climate Change;
and
(C) promotes robust compliance with and enforcement
of existing international legal requirements for the
protection of intellectual property rights, as
formulated in the Agreement on Trade-Related Aspects of
Intellectual Property Rights referred to in section
101(d)(15) of the Uruguay Round Agreements Act (19
U.S.C. 3511(d)(15)) and in applicable intellectual
property provisions of bilateral trade agreements.
SEC. 442. DEFINITIONS.
In this subtitle:
(1) Allowance.--The term ``allowance'' means an emission
allowance established under section 721 of the Clean Air Act.
(2) Appropriate congressional committees.--The term
``appropriate congressional committees'' means--
(A) the Committees on Energy and Commerce, Foreign
Affairs, and Financial Services of the House of
Representatives; and
(B) the Committees on Environment and Public Works,
Energy and Natural Resources, and Foreign Relations of
the Senate.
(3) Convention.--The term ``Convention'' means the United
Nations Framework Convention on Climate Change, done at New
York on May 9, 1992, and entered into force on March 21, 1994.
(4) Developing country.--The term ``developing country''
means a country eligible to receive official development
assistance according to the income guidelines of the
Development Assistance Committee of the Organization for
Economic Cooperation and Development.
(5) Eligible country.--The term ``eligible country'' means
a developing country that is determined by the interagency
group under section 444 to be eligible to receive assistance
under this subtitle.
(6) Interagency group.--The term ``interagency group''
means the group established by the President under section 443
to administer the program established under this subtitle.
(7) Least developed country.--The term ``least developed
country'' means a foreign country the United Nations has
identified as among the least developed of developing
countries.
(8) Qualifying activity.--The term ``qualifying activity''
means an activity that meets the criteria in section 445.
(9) Qualifying entity.--The term ``qualifying entity''
means a national, regional, or local government in, or a
nongovernmental organization or private entity located or
operating in, an eligible country.
SEC. 443. GOVERNANCE.
(a) Oversight.--The Secretary of State, or such other Federal
agency head as the President may designate, in consultation with the
interagency group established under subsection (b), shall oversee
distributions of allowances allocated under section 782(o) of the Clean
Air Act (as added by section 321 of this Act) for distribution pursuant
to this subtitle.
(b) Interagency Group.--The President shall establish an
interagency group to administer the program established under this
subtitle. The Members of the interagency group shall include--
(1) the Secretary of State;
(2) the Administrator of the Environmental Protection
Agency;
(3) the Secretary of Energy;
(4) the Secretary of the Treasury;
(5) the Secretary of Commerce;
(6) the Administrator of the United States Agency for
International Development; and
(7) any other head of a Federal agency or executive branch
appointee that the President may designate.
(c) Chairperson.--The Secretary of State shall serve as the
chairperson of the interagency group.
(d) Supplement Not Supplant.--Allowances distributed pursuant to
this subtitle shall be used to supplement, and not to supplant, any
other Federal, State, or local resources available to carry out
activities that are qualifying activities under this subtitle.
SEC. 444. DETERMINATION OF ELIGIBLE COUNTRIES.
(a) In General.--The interagency group shall determine a country to
be an eligible country for the purposes of this subtitle if a country
meets the following criteria:
(1) The country is a developing country that--
(A) has entered into an international agreement to
which the United States is a party, under which such
country agrees to take actions to produce measurable,
reportable, and verifiable greenhouse gas emissions
mitigation; or
(B) is determined by the interagency group to have
in force national policies and measures that are
capable of producing measurable, reportable, and
verifiable greenhouse gas emissions mitigation.
(2) The country has developed a nationally appropriate
mitigation strategy that seeks to achieve substantial
reductions, sequestration, or avoidance of greenhouse gas
emissions, relative to business-as-usual levels.
(3) Subject to subsection (b)(1), such other criteria as
the President determines will serve the purposes of this
subtitle or other United States national security, foreign
policy, environmental, or economic objectives including robust
compliance with and enforcement of existing international legal
requirements for the protection of intellectual property rights
for clean technology, as formulated in the Agreement on Trade-
Related Aspects of Intellectual Property Rights, referred to in
section 101(d)(15) of the Uruguay Round Agreements Act (19
U.S.C. 3511(d)(15)) and in applicable intellectual property
provisions of bilateral trade agreements.
(b) Exceptions.--
(1) Subsection (a)(3) applies only to bilateral assistance
under section 446(c)(4).
(2) The eligibility criteria in this section do not apply
in the case of least developed countries receiving assistance
under section 445(7) for the purpose of building capacity to
meet such eligibility criteria.
SEC. 445. QUALIFYING ACTIVITIES.
Assistance under this subtitle may be provided only to qualifying
entities for clean technology activities (including building relevant
technical and institutional capacity) that contribute to substantial,
measurable, reportable, and verifiable reductions, sequestration, or
avoidance of greenhouse gas emissions including--
(1) deployment of technologies to capture and sequester
carbon dioxide emissions from electric generating units or
large industrial sources (except that assistance under this
subtitle for such deployment shall be limited to the cost of
retrofitting existing facilities with such technologies or the
incremental cost of purchasing and installing such technologies
at new facilities);
(2) deployment of renewable electricity generation from
wind, solar, sustainably produced biomass, geothermal, marine,
or hydrokinetic sources;
(3) substantial increases in the efficiency of electricity
transmission, distribution, and consumption;
(4) deployment of low- or zero emissions technologies that
are facing financial or other barriers to their widespread
deployment which could be addressed through support under this
subtitle in order to reduce, sequester, or avoid emission;
(5) reduction in transportation sector emissions through
increased transportation system and vehicle efficiency or use
of transportation fuels that have lifecycle greenhouse gas
emissions that are substantially lower than those attributable
to fossil fuel-based alternatives;
(6) reduction in black carbon emissions; or
(7) capacity building activities, including--
(A) developing and implementing methodologies and
programs for measuring and quantifying greenhouse gas
emissions and verifying emissions mitigation;
(B) assessing, developing, and implementing
technology and policy options for greenhouse gas
emissions mitigation and avoidance of future emissions,
including sector and cross-sector mitigation
strategies; and
(C) providing other forms of technical assistance
to facilitate the qualification for, and receipt of,
assistance under this Act.
SEC. 446. ASSISTANCE.
(a) In General.--The Secretary of State, or such other Federal
agency head as the President may designate, is authorized to provide
assistance, through the distribution of allowances allocated for such
purpose under section 782(o) of the Clean Air Act (as added by section
321 of this Act) for qualifying activities that take place in eligible
countries, in accordance with the requirements of this subtitle.
(b) Definition.--For the purposes of this section the term ``clean
technology'' means any technology or service related to the qualifying
activities identified in section 445.
(c) Distribution of Allowances.--
(1) In general.--The Secretary of State, or such other
Federal agency head as the President may designate, after
consultation with the interagency group, shall distribute
allowances under this subtitle--
(A) in the form of bilateral assistance in
accordance with paragraph (4);
(B) to multilateral funds or institutions pursuant
to the Convention or an agreement negotiated under the
Convention; or
(C) through some combination of the mechanisms
identified in subparagraphs (A) and (B).
(2) Global environment facility.--For any allowances
provided to the Global Environment Facility pursuant to
paragraph (1)(B), the President shall designate the Secretary
of the Treasury to distribute those allowances to the Global
Environment Facility.
(3) Distribution through international fund or
institution.--If allowances are distributed to a multilateral
fund or institution, as authorized in paragraph (1), the
Secretary of State, or such other Federal agency head as the
President may designate, shall seek to ensure the establishment
and implementation of adequate mechanisms to--
(A) apply and enforce the criteria for
determination of eligible countries and qualifying
activities under sections 444 and 445, respectively;
(B) require public reporting describing the process
and methodology for selecting the ultimate recipients
of assistance and a description of each activity that
received assistance, including the amount of
obligations and expenditures for assistance; and
(C) require that no funds be expended for the
benefit of any qualifying activity where that activity
or any activity relating to a qualifying activity under
section 445 undermines the robust compliance with and
enforcement of existing legal requirements for the
protection of intellectual property rights for clean
technology, as formulated in the Agreement on Trade-
Related Aspects of Intellectual Property Rights,
referred to in section 101(d)(15) of the Uruguay Round
Agreements Act (19 U.S.C. 3511(d)(15)).
(4) Bilateral assistance.--
(A) In general.--Bilateral assistance under
paragraph (1) shall be carried out by the Administrator
of the United States Agency for International
Development, in consultation with the interagency
group.
(B) Limitations.--Not more than 15 percent of
allowances made available to carry out bilateral
assistance under this subtitle in any year shall be
distributed to support activities in any single
country.
(C) Selection criteria.--Not later than 2 years
after the date of enactment of this subtitle, the
Administrator of the United States Agency for
International Development, after consultation with the
interagency group, shall develop and publish a set of
criteria to be used in evaluating activities within
eligible countries for bilateral assistance under this
subtitle.
(D) Criteria requirements.--The criteria under
subparagraph (C) shall require that--
(i) the activity is a qualifying activity;
(ii) the activity will be conducted as part
of an eligible country's nationally appropriate
mitigation strategy or as part of an eligible
country's actions towards providing a
nationally appropriate mitigation strategy to
reduce, sequester, or avoid emissions being
implemented by the eligible country;
(iii) the activity will not have adverse
effects on human health, safety, or welfare,
the environment, or natural resources;
(iv) any technologies deployed through
bilateral assistance under this subtitle will
be properly implemented and maintained;
(v) the activity will not cause any net
loss of United States jobs or displacement of
United States production;
(vi) costs of the activity will be shared
by the host country government, private sector
parties, or a multinational development bank,
except that this clause does not apply to least
developed countries;
(vii) the activity would not undermine the
protection of intellectual property rights for
clean technology, as formulated in the
Agreement on Trade-Related Aspects of
Intellectual Property Rights, referred to in
section 101(d)(15) of the Uruguay Round
Agreements Act (19 U.S.C. 3511(d)(15)) and
applicable intellectual property provisions of
bilateral trade agreements; and
(viii) the activity meets such other
requirements as the interagency group
determines appropriate to further the purposes
of this subtitle.
(E) Criteria preferences.--The criteria under
subparagraph (C) shall give preference to activities
that--
(i) promise to achieve large-scale
greenhouse gas reductions, sequestration, or
avoidance at a national, sectoral or cross-
sectoral level;
(ii) have the potential to catalyze a shift
within the host country towards widespread
deployment of low- or zero-carbon energy
technologies;
(iii) build technical and institutional
capacity and other activities that are unlikely
to be attractive to private sector funding; or
(iv) maximize opportunities to leverage
other sources of assistance and catalyze
private-sector investment.
(d) Monitoring, Evaluation, and Enforcement.--The Secretary of
State, or such other Federal agency head as the President may
designate, in consultation with the interagency group, shall establish
and implement a system to monitor and evaluate the performance of
activities receiving assistance under this subtitle. The Secretary of
State, or such other Federal agency head as the President may
designate, shall have the authority to suspend or terminate assistance
in whole or in part for an activity if it is determined that the
activity is not operating in compliance with the approved proposal.
(e) Coordination With U.S. Foreign Assistance.--Subject to the
direction of the President, the Secretary of State shall, to the extent
practicable, seek to align activities under this section with broader
development, poverty alleviation, or natural resource management
objectives and initiatives in the recipient country.
(f) Annual Reports.--Not later than March 1, 2012, and annually
thereafter, the President shall submit to the appropriate congressional
committees a report on the assistance provided under this subtitle
during the prior fiscal year. Such report shall include--
(1) a description of the amount and value of allowances
distributed during the prior fiscal year;
(2) a description of each activity that received assistance
during the prior fiscal year, and a description of the
anticipated and actual outcomes;
(3) an assessment of any adverse effects to human health,
safety, or welfare, the environment, or natural resources as a
result of activities supported under this subtitle;
(4) an assessment of the success of the assistance provided
under this subtitle to improving the technical and
institutional capacity to implement substantial emissions
reductions;
(5) an estimate of the greenhouse gas emissions reductions,
sequestration, or avoidance achieved by assistance provided
under this subtitle during the prior fiscal year; and
(6) an assessment whether any funds expended for the
benefit of any qualifying activity undermined the protection of
intellectual property rights for clean technology, as
formulated in the Agreement on Trade-Related Aspects of
Intellectual Property Rights, referred to in section 101(d)(15)
of the Uruguay Round Agreements Act (19 U.S.C. 3511(d)(15)) and
applicable intellectual property provisions of bilateral trade
agreements.
(g) Not Eligible for Offset Credit.--Activities that receive
support under this subtitle shall not be issued offset credits for the
greenhouse gas emissions reductions or avoidance, or greenhouse gas
sequestration, produced by such activities.
Subtitle E--Adapting to Climate Change
PART 1--DOMESTIC ADAPTATION
Subpart A--National Climate Change Adaptation Program
SEC. 451. GLOBAL CHANGE RESEARCH AND DATA MANAGEMENT.
(a) Short Title.--This section may be cited as the ``Global Change
Research and Data Management Act of 2009''.
(b) Global Change Research.--
(1) Purpose.--The purpose of this subsection is to provide
for the continuation and coordination of a comprehensive and
integrated United States observation, research, and outreach
program which will assist the Nation and the world to
understand, assess, predict, and respond to the effects of
human-induced and natural processes of global change.
(2) Definitions.--For purposes of this subsection--
(A) the term ``global change'' means human-induced
or natural changes in the global environment (including
alterations in climate, land productivity, oceans or
other water resources, atmospheric chemistry,
biodiversity, and ecological systems) that may alter
the capacity of the Earth to sustain life;
(B) the term ``global change research'' means
study, monitoring, assessment, prediction, and
information management activities to describe and
understand--
(i) the interactive physical, chemical, and
biological processes that regulate the total
Earth system;
(ii) the unique environment that the Earth
provides for life;
(iii) changes that are occurring in the
Earth system; and
(iv) the manner in which such system,
environment, and changes are influenced by
human actions;
(C) the term ``interagency committee'' means the
interagency committee established under paragraph (3);
(D) the term ``Plan'' means the National Global
Change Research and Assessment Plan developed under
paragraph (5);
(E) the term ``Program'' means the United States
Global Change Research Program established under
paragraph (4); and
(F) the term ``regional climate change'' means the
natural or human-induced changes manifested in the
local or regional environment (including alterations in
weather patterns, land productivity, water resources,
sea level rise, atmospheric chemistry, biodiversity,
and ecological systems) that may alter the capacity of
a specific region to support current or future social
and economic activity or natural ecosystems.
(3) Interagency cooperation and coordination.--
(A) Establishment.--The President shall establish
or designate an interagency committee to ensure
cooperation and coordination of all Federal research
activities pertaining to processes of global change for
the purpose of increasing the overall effectiveness and
productivity of Federal global change research efforts.
The interagency committee shall include research and
program representatives of agencies conducting global
change research, agencies with authority over resources
likely to be affected by global change, and agencies
with authority to mitigate human-induced global change.
(B) Functions of the interagency committee.--The
interagency committee shall--
(i) serve as the forum for developing the
Plan and for overseeing its implementation;
(ii) serve as the forum for developing the
vulnerability assessment under paragraph (7);
(iii) ensure cooperation among Federal
agencies with respect to global change research
activities;
(iv) work with academic, State, industry,
and other groups conducting global change
research, to provide for periodic public and
peer review of the Program;
(v) cooperate with the Secretary of State
in--
(I) providing representation at
international meetings and conferences
on global change research in which the
United States participates; and
(II) coordinating the Federal
activities of the United States with
programs of other nations and with
international global change research
activities;
(vi) work with appropriate Federal, State,
regional, and local authorities to ensure that
the Program is designed to produce information
needed to develop policies to mitigate human-
induced global change and to reduce the
vulnerability of the United States and other
regions to global change;
(vii) facilitate ongoing dialog and
information exchange with regional, State, and
local governments and other user communities;
and
(viii) identify additional decisionmaking
groups that may use information generated
through the Program.
(4) United states global change research program.--
(A) Establishment.--The President shall establish
an interagency United States Global Change Research
Program to improve understanding of global change, to
respond to the information needs of communities and
decisionmakers, and to provide periodic assessments of
the vulnerability of the United States and other
regions to global and regional climate change. The
Program shall be implemented in accordance with the
Plan.
(B) Lead agency.--The lead agency for the United
States Global Change Research Program shall be the
Office of Science and Technology Policy.
(C) Interagency program activities.--The Director
of the Office of Science and Technology Policy, in
consultation with the interagency committee, shall
identify activities included in the Plan that involve
participation by 2 or more agencies in the Program, and
that do not fall within the current fiscal year budget
allocations of those participating agencies, to fulfill
the requirements of this section. The Director of the
Office of Science and Technology Policy shall allocate
funds to the agencies to conduct the identified
interagency activities. Such activities may include--
(i) development of scenarios for climate,
land-cover change, population growth, and
socioeconomic development;
(ii) calibration and testing of alternative
regional and global climate models;
(iii) identification of economic sectors
and regional climatic zones; and
(iv) convening regional workshops to
facilitate information exchange and involvement
of regional, State, and local decisionmakers,
non-Federal experts, and other stakeholder
groups in the activities of the Program.
(D) Workshops.--The Director shall ensure that at
least one workshop is held per year in each region
identified by the Plan under paragraph (5)(B)(xi) to
facilitate information exchange and outreach to
regional, State, and local stakeholders as required by
this section.
(E) Authorization of appropriations.--There are
authorized to be appropriated to the Office of Science
and Technology Policy for carrying out this paragraph
$10,000,000 for each of the fiscal years 2009 through
2014.
(5) National global change research and assessment plan.--
(A) In general.--The President shall develop a
National Global Change Research and Assessment Plan for
implementation of the Program. The Plan shall contain
recommendations for global change research and
assessment. The President shall submit an outline for
the development of the Plan to the Congress within 1
year after the date of enactment of this Act, and shall
submit a completed Plan to the Congress within 3 years
after the date of enactment of this Act. Revised Plans
shall be submitted to the Congress at least once every
5 years thereafter. In the development of each Plan,
the President shall conduct a formal assessment process
under this paragraph to determine the needs of
appropriate Federal, State, regional, and local
authorities and other interested parties regarding the
types of information needed by them in developing
policies to mitigate human-induced global change and to
reduce society's vulnerability to global change and
shall utilize these assessments, including the reviews
by the National Academy of Sciences and the National
Governors Association under subparagraphs (E) and (F),
in developing the Plan.
(B) Contents of the plan.--The Plan shall--
(i) establish, for the 10-year period
beginning in the year the Plan is submitted,
the goals and priorities for Federal global
change research which most effectively advance
scientific understanding of global change and
provide information of use to Federal, State,
regional, and local authorities in the
development of policies relating to global
change;
(ii) describe specific activities,
including efforts to determine user information
needs, research activities, data collection,
database development, and data analysis
requirements, development of regional
scenarios, assessment of model predictability,
assessment of climate change impacts,
participation in international research
efforts, and information management, required
to achieve such goals and priorities;
(iii) identify relevant programs and
activities of the Federal agencies that
contribute to the Program directly and
indirectly;
(iv) set forth the role of each Federal
agency in implementing the Plan;
(v) consider and utilize, as appropriate,
reports and studies conducted by Federal
agencies, the National Research Council, or
other entities;
(vi) make recommendations for the
coordination of the global change research and
assessment activities of the United States with
such activities of other nations and
international organizations, including--
(I) a description of the extent and
nature of international cooperative
activities;
(II) bilateral and multilateral
efforts to provide worldwide access to
scientific data and information; and
(III) improving participation by
developing nations in international
global change research and
environmental data collection;
(vii) detail budget requirements for
Federal global change research and assessment
activities to be conducted under the Plan;
(viii) catalog the type of information
identified by appropriate Federal, State,
regional, and local decisionmakers needed to
develop policies to reduce society's
vulnerability to global change and indicate how
the planned research will meet these
decisionmakers' information needs;
(ix) identify the observing systems
currently employed in collecting data relevant
to global and regional climate change research
and prioritize additional observation systems
that may be needed to ensure adequate data
collection and monitoring of global change;
(x) describe specific activities designed
to facilitate outreach and data and information
exchange with regional, State, and local
governments and other user communities; and
(xi) identify and describe regions of the
United States that are likely to experience
similar impacts of global change or are likely
to share similar vulnerabilities to global
change.
(C) Research elements.--The Plan shall include at a
minimum the following research elements:
(i) Global measurements, establishing
worldwide to regional scale observations
prioritized to understand global change and to
meet the information needs of decisionmakers on
all relevant spatial and time scales.
(ii) Information on economic, demographic,
and technological trends that contribute to
changes in the Earth system and that influence
society's vulnerability to global and regional
climate change.
(iii) Development of indicators and
baseline databases to document global change,
including changes in species distribution and
behavior, extent of glaciations, and changes in
sea level.
(iv) Studies of historical changes in the
Earth system, using evidence from the
geological and fossil record.
(v) Assessments of predictability using
quantitative models of the Earth system to
simulate global and regional environmental
processes and trends.
(vi) Focused research initiatives to
understand the nature of and interaction among
physical, chemical, biological, land use, and
social processes related to global and regional
climate change.
(vii) Focused research initiatives to
determine and then meet the information needs
of appropriate Federal, State, and regional
decisionmakers.
(D) Information management.--The Plan shall
incorporate, to the extent practicable, the
recommendations relating to data acquisition,
management, integration, and archiving made by the
interagency climate and other global change data
management working group established under subsection
(c)(3).
(E) National academy of sciences evaluation.--The
President shall enter into an agreement with the
National Academy of Sciences under which the Academy
shall--
(i) evaluate the scientific content of the
Plan; and
(ii) recommend priorities for future global
and regional climate change research and
assessment.
(F) National governors association evaluation.--The
President shall enter into an agreement with the
National Governors Association Center for Best
Practices under which that Center shall--
(i) evaluate the utility to State, local,
and regional decisionmakers of each Plan and of
the anticipated and actual information outputs
of the Program for development of State, local,
and regional policies to reduce vulnerability
to global change; and
(ii) recommend priorities for future global
and regional climate change research and
assessment.
(G) Public participation.--In developing the Plan,
the President shall consult with representatives of
academic, State, industry, and environmental groups.
Not later than 90 days before the President submits the
Plan, or any revision thereof, to the Congress, a
summary of the proposed Plan shall be published in the
Federal Register for a public comment period of not
less than 60 days.
(6) Budget coordination.--
(A) In general.--The President shall provide
general guidance to each Federal agency participating
in the Program with respect to the preparation of
requests for appropriations for activities related to
the Program.
(B) Consideration in president's budget.--The
President shall submit, at the time of his annual
budget request to Congress, a description of those
items in each agency's annual budget which are elements
of the Program.
(7) Vulnerability assessment.--
(A) Requirement.--Within 1 year after the date of
enactment of this Act, and at least once every 5 years
thereafter, the President shall submit to the Congress
an assessment which--
(i) integrates, evaluates, and interprets
the findings of the Program and discusses the
scientific uncertainties associated with such
findings;
(ii) analyzes current trends in global
change, both human-induced and natural, and
projects major trends for the subsequent 25 to
100 years;
(iii) based on indicators and baselines
developed under paragraph (5)(C)(iii), as well
as other measurements, analyzes changes to the
natural environment, land and water resources,
and biological diversity in--
(I) major geographic regions of the
United States; and
(II) other continents;
(iv) analyzes the effects of global change,
including the changes described in clause
(iii), on food and fiber production, energy
production and use, transportation, human
health and welfare, water availability and
coastal infrastructure, and human social and
economic systems, including providing
information about the differential impacts on
specific geographic regions within the United
States, on people of different income levels
within those regions, and for rural and urban
areas within those regions; and
(v) summarizes the vulnerability of
different geographic regions of the world to
global change and analyzes the implications of
global change for the United States, including
international assistance, population
displacement, food and resource availability,
and national security.
(B) Use of related reports.--To the extent
appropriate, the assessment produced pursuant to this
paragraph may coordinate with, consider, incorporate,
or otherwise make use of related reports, assessments,
or information produced by the United States Global
Change Research Program, regional, State, and local
entities, and international organizations, including
the World Meteorological Organization and the
Intergovernmental Panel on Climate Change.
(8) Policy assessment.--Not later than 1 year after the
date of enactment of this Act, and at least once every 4 years
thereafter, the President shall enter into a joint agreement
with the National Academy of Public Administration and the
National Academy of Sciences under which the Academies shall--
(A) document current policy options being
implemented by Federal, State, and local governments to
mitigate or adapt to the effects of global and regional
climate change;
(B) evaluate the realized and anticipated
effectiveness of those current policy options in
meeting mitigation and adaptation goals;
(C) identify and evaluate a range of additional
policy options and infrastructure for mitigating or
adapting to the effects of global and regional climate
change;
(D) analyze the adoption rates of policies and
technologies available to reduce the vulnerability of
society to global change with an evaluation of the
market and policy obstacles to their adoption in the
United States; and
(E) evaluate the distribution of economic costs and
benefits of these policy options across different
United States economic sectors.
(9) Annual report.--Each year at the time of submission to
the Congress of the President's budget request, the President
shall submit to the Congress a report on the activities
conducted pursuant to this subsection, including--
(A) a description of the activities of the Program
during the past fiscal year;
(B) a description of the activities planned in the
next fiscal year toward achieving the goals of the
Plan; and
(C) a description of the groups or categories of
State, local, and regional decisionmakers identified as
potential users of the information generated through
the Program and a description of the activities used to
facilitate consultations with and outreach to these
groups, coordinated through the work of the interagency
committee.
(10) Relation to other authorities.--The President shall--
(A) ensure that relevant research, assessment, and
outreach activities of the National Climate Program,
established by the National Climate Program Act (15
U.S.C. 2901 et seq.), are considered in developing
national global and regional climate change research
and assessment efforts; and
(B) facilitate ongoing dialog and information
exchange with regional, State, and local governments
and other user communities through programs authorized
in the National Climate Program Act (15 U.S.C. 2901 et
seq.).
(11) Repeal.--The Global Change Research Act of 1990 (15
U.S.C. 2921 et seq.) is amended by striking titles I and III
thereof.
(12) Global change research information.--The President
shall establish or designate a Global Change Research
Information Exchange to make scientific research and other
information produced through or utilized by the Program which
would be useful in preventing, mitigating, or adapting to the
effects of global change accessible through electronic means.
(13) Ice sheet study and report.--
(A) Study.--
(i) Requirement.--The Director of the
National Science Foundation and the
Administrator of National Oceanic and
Atmospheric Administration shall enter into an
arrangement with the National Academy of
Sciences to complete a study of the current
status of ice sheet melt, as caused by climate
change, with implications for global sea level
rise.
(ii) Contents.--The study shall take into
consideration--
(I) the past research completed
related to ice sheet melt as reviewed
by Working Group I of the
Intergovernmental Panel on Climate
Change;
(II) additional research completed
since the fall of 2005 that was not
included in the Working Group I report
due to time constraints; and
(III) the need for an accurate
assessment of changes in ice sheet
spreading, changes in ice sheet flow,
self-lubrication, the corresponding
effect on ice sheets, and current
modeling capabilities.
(B) Report.--Not later than 18 months after the
date of enactment of this Act, the National Academy of
Sciences shall transmit to the Committee on Science and
Technology of the House of Representatives and the
Committee on Commerce, Science, and Transportation of
the Senate a report on the key findings of the study
conducted under subparagraph (A), along with
recommendations for additional research related to ice
sheet melt and corresponding sea level rise.
(14) Hurricane frequency and intensity study and report.--
(A) Study.--
(i) Requirement.--The Administrator of the
National Oceanic and Atmospheric Administration
and the Director of the National Science
Foundation shall enter into an arrangement with
the National Academy of Sciences to complete a
study of the current state of the science on
the potential impacts of climate change on
patterns of hurricane and typhoon development,
including storm intensity, track, and
frequency, and the implications for hurricane-
prone and typhoon-prone coastal regions.
(ii) Contents.--The study shall take into
consideration--
(I) the past research completed
related to hurricane and typhoon
development, track, and intensity as
reviewed by Working Groups I and II of
the Intergovernmental Panel on Climate
Change;
(II) additional research completed
since the fall of 2005 that was not
included in the Working Group I and II
reports due to time constraints;
(III) the need for accurate
assessment of potential changes in
hurricane and typhoon intensity, track,
and frequency and of the current
modeling and forecasting capabilities
and the need for improvements in
forecasting of these parameters; and
(IV) the need for additional
research and monitoring to improve
forecasting of hurricanes and typhoons
and to understand the relationship
between climate change and hurricane
and typhoon development.
(B) Report.--Not later than 18 months after the
date of enactment of this Act, the National Academy of
Sciences shall transmit to the Committee on Science and
Technology of the House of Representatives and the
Committee on Commerce, Science, and Transportation of
the Senate a report on the key findings of the study
conducted under subparagraph (A).
(c) Climate and Other Global Change Data Management.--
(1) Purposes.--The purposes of this subsection are to
establish climate and other global change data management and
archiving as Federal agency missions, and to establish Federal
policies for managing and archiving climate and other global
change data.
(2) Definitions.--For purposes of this subsection--
(A) the term ``metadata'' means information
describing the content, quality, condition, and other
characteristics of climate and other global change
data, compiled, to the maximum extent possible,
consistent with the requirements of the ``Content
Standard for Digital Geospatial Metadata'' (FGDC-STD-
001-1998) issued by the Federal Geographic Data
Committee, or any successor standard approved by the
working group; and
(B) the term ``working group'' means the
interagency climate and other global change data
management working group established under paragraph
(3).
(3) Interagency climate and other global change data
management working group.--
(A) Establishment.--The President shall establish
or designate an interagency climate and other global
change data management working group to make
recommendations for coordinating Federal climate and
other global change data management and archiving
activities.
(B) Membership.--The working group shall include
the Administrator of the National Aeronautics and Space
Administration, the Administrator of the National
Oceanic and Atmospheric Administration, the Secretary
of Energy, the Secretary of Defense, the Director of
the National Science Foundation, the Director of the
United States Geological Survey, the Archivist of the
United States, the Administrator of the Environmental
Protection Agency, the Secretary of the Smithsonian
Institution, or their designees, and representatives of
any other Federal agencies the President considers
appropriate.
(C) Reports.--Not later than 1 year after the date
of enactment of this Act, the working group shall
transmit a report to the Congress containing the
elements described in subparagraph (D). Not later than
4 years after the initial report under this
subparagraph, and at least once every 4 years
thereafter, the working group shall transmit reports
updating the previous report. In preparing reports
under this subparagraph, the working group shall
consult with expected users of the data collected and
archived by the Program.
(D) Contents.--The reports and updates required
under subparagraph (C) shall--
(i) include recommendations for the
establishment, maintenance, and accessibility
of a catalog identifying all available climate
and other global change data sets;
(ii) identify climate and other global
change data collections in danger of being lost
and recommend actions to prevent such loss;
(iii) identify gaps in climate and other
global change data and recommend actions to
fill those gaps;
(iv) identify effective and compatible
procedures for climate and other global change
data collection, management, and retention and
make recommendations for ensuring their use by
Federal agencies and other appropriate
entities;
(v) develop and propose a coordinated
strategy for funding and allocating
responsibilities among Federal agencies for
climate and other global change data
collection, management, and retention;
(vi) make recommendations for ensuring that
particular attention is paid to the collection,
management, and archiving of metadata;
(vii) make recommendations for ensuring a
unified and coordinated Federal capital
investment strategy with respect to climate and
other global change data collection,
management, and archiving;
(viii) evaluate the data record from each
observing system and make recommendations to
ensure that delivered data are free from time-
dependent biases and random errors before they
are transferred to long-term archives; and
(ix) evaluate optimal design of observation
system components to ensure a cost-effective,
adequate set of observations detecting and
tracking global change.
SEC. 452. NATIONAL CLIMATE SERVICE.
(a) Short Title.--This section may be cited as the ``National
Climate Service Act of 2009''.
(b) Purpose.--The purpose of this section is to establish a
National Climate Service and to define the activities to be undertaken
within the National Oceanic and Atmospheric Administration to--
(1) advance understanding of climate variability and change
at the global, national, regional, and local levels;
(2) provide forecasts, warnings, and other information to
the public on variability and change in weather and climate
that affect geographic areas, natural resources,
infrastructure, economic sectors, and communities; and
(3) support development of adaptation and response plans by
Federal agencies, State, local, and tribal governments, the
private sector, and the public.
(c) Definitions.--In this section:
(1) Advisory committee.--The term ``Advisory Committee''
means the Climate Service Advisory Committee established under
subsection (f).
(2) Director.--The term ``Director'' means the Director of
the Climate Service Office.
(3) Representative.--The term ``representative'' means an
individual who is not a full-time or part-time employee of the
Federal Government and who is appointed to an advisory
committee to represent the views of an entity or entities
outside the Federal Government.
(4) Special government employee.--The term ``Special
Government Employee'' has the same meaning as in section 202(a)
of title 18, United States Code.
(5) Under secretary.--The term ``Under Secretary'' means
the Under Secretary of Commerce for Oceans and Atmosphere.
(d) Interagency Development of a National Climate Service.--
(1) In general.--The President shall--
(A) initiate a process within 30 days after the
date of enactment of this Act through the Committee on
Environment and Natural Resources of the National
Science and Technology Council and led by the Director
of the Office of Science and Technology Policy, to
evaluate alternative structures to support a
collaborative, interagency research and operational
program that will achieve the goal of meeting the needs
of decisionmakers in--
(i) Federal agencies;
(ii) State, local, and tribal governments;
(iii) regional entities and other
stakeholders and users,
for reliable, timely, and relevant information related
to climate variability and change;
(B) within 1 year after the date of enactment of
this Act complete pursuant to paragraph (2) a survey of
the needs of current and future users of information
related to climate variability and change;
(C) within 2 years after the date of enactment of
this Act report to Congress under paragraph (3) the
results of the evaluation described in subparagraph (A)
and provide a plan to establish a collaborative,
interagency research and operational program to deliver
information related to climate variability and change
to all users; and
(D) within 3 years after the date of enactment of
this Act, and after delivery of the report to Congress
required under subparagraph (C), establish a National
Climate Service, based upon the information obtained
through the process described in subparagraph (A), that
meets the goal described in subparagraph (A).
(2) Survey of need for climate services.--
(A) In general.--The Director of the Office of
Science and Technology Policy, through the Committee on
Environment and Natural Resources, shall provide a
report to Congress within 1 year after the date of
enactment of this Act that compiles information on the
current climate products being delivered by each
Federal agency and its partner organizations to users
and stakeholders, and on the needs of users and
stakeholders for new climate products and services.
(B) Contents of the report.--The report shall
identify--
(i) specific user groups and stakeholders
that currently are served by each Federal
agency and its partner organizations;
(ii) the type of climate products and
services currently delivered to specific users
groups and stakeholders, and the specific
Federal agency office, program, or partner
organization that delivers these products and
services;
(iii) potential user groups and
stakeholders that may be served by expanding
climate products and services;
(iv) specific needs for new climate
products and services to be delivered by each
Federal agency and its partner organizations
identified by user groups and stakeholders;
(v) a characterization of the different
user and stakeholder groups that were surveyed
by each Federal agency; and
(vi) a list of non-Federal entities that
deliver climate products and services.
(3) Report to congress.--
(A) In general.--Within 2 years after the date of
enactment of this Act, the Director of the Office of
Science and Technology Policy shall report to the
President and the Congress on a proposal, prepared
through the Committee on Environment and Natural
Resources, to establish and operate a National Climate
Service. The report shall include--
(i) a description of the alternative
structures considered;
(ii) a description of the structure
proposed for a National Climate Service,
including a discussion of the benefits of this
structure as compared to the alternatives
considered;
(iii) designation of a specific office or
agency that will lead the National Climate
Service and that shall be accountable for the
daily operation of the National Climate
Service;
(iv) a description of the role and
capability of each Federal agency, including a
list of all entities within each agency or
supported with agency funds that currently
provide or may provide climate products or
services;
(v) a description of the mechanisms that
will be used to ensure ongoing communication
and information exchange among the Federal
agencies and between Federal agencies and their
respective user and stakeholder communities
including--
(I) mechanisms to facilitate
ongoing dialogue with non-Federal
organizations providing climate
services;
(II) mechanisms to facilitate
ongoing dialogue with regional, State,
local, and tribal governments, the
private sector, and other users and
stakeholders on the development and
delivery of climate services;
(III) mechanisms to collect
information, observations, and other
data relevant for improving climate
products and services; and
(IV) designation of points of
contact for each Federal agency with
responsibilities to deliver climate
services;
(vi) a detailed description of the
processes and procedures that will be necessary
to coordinate observations and information
collection by different Federal agencies to
ensure the compatibility of information and to
facilitate data and information exchange among
Federal agencies and with non-Federal entities,
and a designation of the agency or agencies
that would be responsible for ongoing oversight
of these functions;
(vii) a detailed description of how
research findings and climate impact
assessments produced through the United States
Global Change Research Program and the other
activities undertaken within the United States
Global Change Research Program would be
integrated with the activities undertaken by a
National Climate Service;
(viii) a list of the existing observation
and monitoring systems or programs operated by
each Federal agency that provide data,
observations, and other information that may be
used to develop or improve climate products and
services;
(ix) a description of new infrastructure,
equipment, personnel or other resources, by
agency, that may be needed to achieve the goals
of a National Climate Service, and the time
period over which these new resources will be
allocated;
(x) an identification of the activities
that may be undertaken in cooperation with
international partners;
(xi) the mechanisms established to provide
quality assurance and quality control of
climate service products and services, and the
agency or agencies designated to conduct and
oversee these mechanisms;
(xii) an identification of non-Federal
entities that provide climate products and
services, and a description of the relationship
envisioned between a National Climate Service
and the non-Federal entities providing climate
services; and
(xiii) responses to the comments received
during the public comment period.
(B) Draft report.--Prior to the submission of the
final report, the Director of the Office of Science and
Technology Policy shall publish a draft report in the
Federal Register with a comment period of at least 30
days.
(C) Consultation.--In developing the report, the
Director of the Office of Science and Technology Policy
shall consult with State, local, and tribal
governments, regional entities, the private sector, and
other users and stakeholder groups, and Congress.
(4) Annual report.--The Director of the Office of Science
and Technology Policy shall transmit to the Congress at the
time of the President's fiscal year 2013 budget request, and
annually thereafter, a report on the annual anticipated cost of
carrying out the research and operational activities of the
National Climate Service, with a description of the budget for
each Federal agency's activities.
(e) Climate Service Program.--
(1) In general.--The Under Secretary, building upon the
resources of the National Weather Service and other weather and
climate programs in the National Oceanic and Atmospheric
Administration, shall establish a Climate Service Program.
(2) Climate service office.--The Under Secretary shall
establish a Climate Service Office and shall appoint a Director
of the Office to collaborate with the leadership of the
National Oceanic and Atmospheric Administration line offices to
perform the duties assigned to the Office. The Climate Service
Office shall--
(A) coordinate programs at the National Oceanic and
Atmospheric Administration to ensure the timely
production and distribution of data and information on
global, national, regional, and local climate
variability and change over all time scales relevant
for planning and response, including intraseasonal,
interannual, decadal, and multidecadal time periods;
(B) ensure exchange of information between the
research and operational offices at the National
Oceanic and Atmospheric Administration to identify
research needs for improving climate products and
services and ensure the timely and orderly transition
of research findings, improved technologies, models,
and other tools to the National Oceanic and Atmospheric
Administration's operations;
(C) ensure operational quality control of all
Climate Service Program products including a
transparent and open accounting of all the assumptions
built into the global, national, regional, and local
weather and climate computer models upon which such
products are based;
(D) ensure a continuous level of high-quality data
collected through a national observation and monitoring
infrastructure, including at a minimum performing
regular maintenance and verification, and periodic
upgrades;
(E) serve as liaison to and exchange information
with other Federal agencies that provide climate
services in order to--
(i) ensure the timely dissemination of data
and information on weather and climate produced
by the National Oceanic and Atmospheric
Administration to other Federal agencies;
(ii) ensure that data and information
collected by other Federal agencies relevant to
improving climate services are made available
to the National Oceanic and Atmospheric
Administration;
(iii) facilitate the development and
delivery of climate products and services to
relevant stakeholders; and
(iv) obtain information from other Federal
agencies to improve the development and
dissemination by the National Oceanic and
Atmospheric Administration of information on
weather and climate to other Federal agencies
for the development of climate service products
by those agencies;
(F) ensure cooperation and collaboration, as
appropriate, of the Climate Service Program with State,
local, and tribal governments, regional entities,
academic and nonprofit research organizations, and
private sector entities, including weather information
providers and other stakeholders; and
(G) ensure exchange of data, information, and
research with the United States Global Change Research
Program to support the development of assessments
required under the Global Change Research Act of 1990
(15 U.S.C. 2921 et seq.).
(3) Climate service program.--
(A) In general.--The Under Secretary shall operate
the Climate Service Program through a national center,
the Climate Service Office, and a network of regional
and local facilities, including the established
regional and local offices of the National Weather
Service, 6 Regional Climate Centers, the offices of the
Regional Integrated Sciences and Assessments program,
the National Integrated Drought Information System, and
any other National Oceanic and Atmospheric
Administration or National Oceanic and Atmospheric
Administration-supported regional and local entities,
as appropriate.
(B) Regional climate centers program.--The Under
Secretary shall maintain a network of 6 Regional
Climate Centers to work cooperatively with the State
Climate Offices to--
(i) collect and exchange data and
information needed to characterize, understand,
and forecast regional and local weather and
climate;
(ii) facilitate collection and exchange of
data and information between the States and
Federal Government on weather and climate in
conjunction with the National Climatic Data
Center;
(iii) support research and observations;
(iv) obtain input on stakeholder needs for
weather and climate information and products;
and
(v) support State and local adaptation and
response planning.
(C) Regional integrated sciences and assessments
program.--The Under Secretary shall maintain a network
of offices as part of the Regional Integrated Sciences
and Assessments Program. Such offices shall engage in
cooperative research, development, and demonstration
projects with the academic community, State Climate
Offices, Regional Climate Offices, and other users and
stakeholders on climate products, technologies, models,
and other tools to improve understanding and
forecasting of regional and local climate variability
and change and the effects on economic activities,
natural resources, and water availability, and other
effects on communities, to facilitate development of
regional and local adaptation plans to respond to
climate variability and change, and any other needed
research identified by the Under Secretary or the
Advisory Committee.
(D) Other offices.--In carrying out the functions
of the Climate Service Program, the Under Secretary
shall utilize the assets and expertise of--
(i) the National Weather Service to--
(I) deliver operational weather and
climate forecasts, warnings, products,
and information through the Climate
Service Programs Division, Local
Weather Forecast Offices, Weather
Service Offices, and River Forecast
Centers; and
(II) develop climate forecast
models and tools through the National
Centers for Environmental Prediction;
(ii) the National Environmental Satellite,
Data, and Information Service to provide data
services and support for product development
and operations through the National Climatic
Data Center and the Regional Climate Centers;
(iii) the Office of Oceanic and Atmospheric
Research to--
(I) provide research on product
development;
(II) improve weather and climate
forecast models;
(III) provide new technologies and
methods of observation; and
(IV) oversee the National Oceanic
and Atmospheric Administration
supported research performed by the
Joint Cooperative Institutes,
universities, and other non-Federal
entities;
(iv) the National Integrated Drought
Information System to--
(I) provide an effective drought
warning system;
(II) coordinate and integrate
Federal research on droughts;
(III) collect and integrate
information on key indicators of
drought;
(IV) make usable, reliable, and
timely forecasts and assessments of
drought, including assessments of the
severity of drought conditions and
effects;
(V) communicate drought forecasts,
conditions, and effects to Federal,
State, tribal, and local governments,
regional entities, the private sector,
and the public; and
(VI) coordinate with State Climate
Offices and RISA teams to assess
management practices and technologies,
and the effects of both, used for
drought mitigation at the local, State,
and regional levels; and
(v) any other National Oceanic and
Atmospheric Administration offices or programs,
as appropriate.
(E) Mission.--The Under Secretary shall ensure that
the core functions and missions of the National Weather
Service, the National Integrated Drought Information
System, and any other programs within the National
Oceanic and Atmospheric Administration are not
diminished or neglected by the establishment of the
Climate Service Program or the duties imposed on such
offices or programs under this paragraph.
(F) Program elements.--The Climate Service Program
shall--
(i) conduct analyses of and studies
relating to the effects of weather and climate
on communities, including effects on
agricultural production, natural resources,
energy supply and demand, recreation, and other
sectors of the economy;
(ii) carry out observations, data
collection, and monitoring of atmospheric and
oceanic conditions on a statewide, regional,
national, and global basis;
(iii) provide information and technical
support for Federal, regional, State, tribal,
and local government efforts to assess and
respond to climate variability and change;
(iv) develop systems for the management and
dissemination of data, information, and
assessments, including mechanisms for
consultation with current and potential users
and other stakeholders;
(v) conduct research to improve
forecasting, characterization, and
understanding of weather and climate
variability and change and its effects on
communities, including its effects on
agricultural production, natural resources,
energy supply and demand, recreation, and other
sectors of the economy; and
(vi) develop tools to facilitate the use of
climate information by local and regional
stakeholders.
(f) Climate Service Advisory Committee.--
(1) In general.--The Under Secretary shall establish a
Climate Service Advisory Committee to provide advice on--
(A) climate service product development;
(B) delivery of services to decisionmakers and
other stakeholders;
(C) infrastructure to support observations and
monitoring;
(D) computation and modeling needs, research needs,
and other resources needed to develop, distribute, and
ensure the utility of climate data, products, and
services; and
(E) any other topics as may be requested by the
Under Secretary or Congress.
(2) Members.--
(A) In general.--The Advisory Committee shall be
composed of at least 25 members appointed by the Under
Secretary. Each member of the Advisory Committee shall
be qualified either--
(i) by education, training, and experience
to evaluate scientific and technical
information on matters referred to the Advisory
Committee under this subsection; or
(ii) to evaluate the utility and need for
climate products by planners, decisionmakers,
the private sector, and the public.
(B) Terms of service.--Members shall be appointed
for 3-year terms, renewable once, and shall serve at
the discretion of the Under Secretary. Vacancy
appointments shall be for the remainder of the
unexpired term of the vacancy, and an individual so
appointed may subsequently be appointed for 2 full 3-
year terms if the remainder of the unexpired term is
less than 1 year.
(C) Chairperson.--The Under Secretary shall
designate a chairperson from among the members of the
Advisory Committee. The designated Chairperson shall
alternate between a member who is appointed as a
representative and a member who is appointed as a
Special Government Employee.
(D) Subcommittees.--
(i) Establishment.--The Advisory Committee
shall establish--
(I) a Subcommittee on Science and
Technology to advise the Climate
Service Program on needed research,
technology development, and additional
observations, and on any other
scientific or technical issues as
appropriate; and
(II) a Subcommittee on Product
Development and Delivery composed
primarily of representatives of the
community of potential users of the
products developed and delivered by the
Climate Service Program.
The Advisory Committee may establish such
additional subcommittees of its members as may
be necessary.
(ii) Appointment.--
(I) Full advisory committee.--At
least 50 percent of the members of the
Advisory Committee shall be appointed
as Special Government Employees.
(II) Subcommittees.--At least 75
percent of the members of the
Subcommittee on Science and Technology
shall be appointed as Special
Government Employees. Not more than 25
percent of the members of the
Subcommittee on Product Development and
Delivery shall be appointed as Special
Government Employees.
(3) Administrative provisions.--
(A) Reporting.--The Advisory Committee shall report
to the Under Secretary and the appropriate requesting
party.
(B) Administrative support.--The Under Secretary
shall provide administrative support to the Advisory
Committee.
(C) Meetings.--The Advisory Committee shall meet at
least twice each year and at other times at the call of
the Under Secretary or the Chairperson.
(D) Compensation and expenses.--A member of the
Advisory Committee shall not be compensated for service
on the Advisory Committee, but may be allowed travel
expenses, including per diem in lieu of subsistence, in
accordance with subchapter I of chapter 57 of title 5,
United States Code.
(4) Expiration.--Section 14 of the Federal Advisory
Committee Act (5 U.S.C. App.) shall not apply to the Climate
Service Advisory Committee.
(g) Repeal.--The National Climate Program Act (15 U.S.C. 2901 et
seq.) is repealed.
(h) Establishment of Regional Integrated Sciences and Assessments
Teams.--
(1) In general.--In maintaining the network of Regional
Integrated Sciences and Assessments (RISA) Teams under
subsection (e)(3)(C), the Under Secretary shall utilize a
competitive, peer-reviewed selection process. Teams shall
conduct applied regional climate research and projects to
address the needs of local and regional decisionmakers for
information and tools to develop adaptation and response plans
to climate variability and change. The awards shall be
administered through a cooperative agreement between the
National Oceanic and Atmospheric Administration and the RISA
Team. Each award shall be for a period of 5 years.
(2) RISA teams.--Teams shall be composed of multi-
institutional partnerships whose individual members may
include--
(A) institutions of higher education, as defined in
section 101(a) of the Higher Education Act of 1965 (20
U.S.C. 1001(a));
(B) minority serving institutions, as defined in
section 371(a) of the Higher Education Act of 1965; and
(C) nongovernmental research organizations, Federal
agencies, State and local agencies, tribal
organizations, and for-profit entities.
(3) Considerations.--In making awards under this
subsection, the Under Secretary shall consider--
(A) the overall geographic distribution of RISA
Teams and existing gaps in applied research to support
local and regional decisionmakers;
(B) the team's ability to contribute to the
National Oceanic and Atmospheric Administration's
efforts to deliver climate services in the region; and
(C) the team's proposal to integrate social and
physical sciences research to address the effects of
climate variability and change on the ecology, economy,
infrastructure, and communities in the region.
(i) Survey of Need for Climate Services.--
(1) In general.--The Under Secretary shall provide a report
to Congress within 9 months after the date of enactment of this
Act that compiles information on the current climate products
being delivered by the National Oceanic and Atmospheric
Administration and its partner organizations to users and
stakeholders and on the needs of users and stakeholders for new
climate products and services.
(2) Contents of report.--The report shall identify--
(A) specific user groups and stakeholders that
currently are served by the National Oceanic and
Atmospheric Administration and its partner
organizations;
(B) the type of climate products and services
currently delivered to specific user groups and
stakeholders and the specific National Oceanic and
Atmospheric Administration office or partner
organization that delivers these products and services;
(C) potential user groups and stakeholders that may
be served by expanding climate products and services;
and
(D) specific needs for new climate products and
services identified by user groups and stakeholders.
(3) Consultation.--The Under Secretary shall consult with
the Climate Service Advisory Committee in the preparation of
this report.
(j) Implementation Plan.--
(1) In general.--The Under Secretary shall prepare a plan
for creating a Climate Service Program in the National Oceanic
and Atmospheric Administration and delivering climate products
and services to the National Oceanic and Atmospheric
Administration users and stakeholders. The plan shall be
submitted to the President and the Congress within 1 year after
the date of enactment of this Act.
(2) Draft plan.--Prior to the submission of the final plan,
the Under Secretary shall publish a draft plan in the Federal
Register with a public comment period of at least 30 days.
(3) Contents.--The plan shall--
(A) identify the current gaps in climate services
and outline the process and resources the National
Oceanic and Atmospheric Administration will use to fill
these gaps;
(B) describe the roles of the National Oceanic and
Atmospheric Administration line offices and the
National Oceanic and Atmospheric Administration partner
organizations in the development and delivery of
climate products and services;
(C) describe the development and implementation of
quality assurance and control mechanisms for climate
products and services delivered by the National Oceanic
and Atmospheric Administration and its partner
organizations;
(D) identify the mechanisms and opportunities for
determining user needs and engaging in a two-way
dialogue with users that will inform climate product
and service development and delivery of authoritative,
timely, and useful information on climate variability
and change and the effects on local, State, regional,
national, and global scales;
(E) identify new responsibilities or tasks to be
undertaken by existing National Oceanic and Atmospheric
Administration line offices and partner organizations;
(F) identify new infrastructure, equipment,
personnel, or other resources needed to implement the
proposed plan; and
(G) include responses to the comments received
during the public comment period.
(4) Continuity of service.--During the development of the
implementation plan, the public comment period, and final plan,
the National Oceanic and Atmospheric Administration shall
continue to provide climate services to the user community.
(5) Consultation.--In developing the plan, the Under
Secretary shall consult with user groups and stakeholders,
State Climate Offices, Regional Climate Centers, other Federal
agencies, the Climate Service Advisory Committee, and Congress.
(6) Coordination with interagency development of a national
climate service.--In preparing the plan required under this
subsection, the Under Secretary shall consult with the Director
of the Office of Science and Technology Policy to ensure that
the program developed by the Agency will serve the needs of a
National Climate Service.
(k) Summer Institutes Program at the Regional Climate Centers.--
(1) Definitions.--In this subsection:
(A) Summer institute.--The term ``summer
institute'' means an institute, operated during the
summer, that--
(i) is hosted by a Regional Climate Center
or an eligible partner;
(ii) is operated for a period of not less
than 2 weeks; and
(iii) provides direct interaction of middle
school and high school teacher and
undergraduate student participants with
personnel of the Regional Climate Centers or
eligible partners who have scientific expertise
in weather and climate.
(B) Eligible partner.--The term ``eligible
partner'' means--
(i) the science, engineering, or
mathematics department at an institution of
higher education; or
(ii) a nonprofit entity with expertise in
providing educational enrichment experiences
for students.
(2) Summer institutes program authorized.--
(A) In general.--The Under Secretary shall
establish a summer institutes program, to be conducted
in cooperation with the Regional Climate Centers, which
may include an eligible partner. The purpose of the
program is to provide training and professional
enrichment by providing opportunities for interaction
between participants and climate scientists in a
research and operational setting to--
(i) enable middle school and high school
teachers to integrate weather and climate
sciences into their curricula: and
(ii) encourage undergraduate students to
pursue further study and careers in weather and
climate sciences.
(B) Required activities.--Funds authorized under
this subsection shall be used for--
(i) providing educational opportunities for
middle school and high school teachers and
undergraduate students not achievable inside
the classroom;
(ii) exposing such teachers and students to
researchers, scientists, or engineers who can
demonstrate their daily activities to the
teachers and students;
(iii) exposing teachers and students to
scientific methods in a research discovery
setting; and
(iv) assisting teachers with curriculum
development in the areas of weather and climate
science.
(3) Priority.--The Under Secretary shall ensure that each
summer institute program authorized under paragraph (2)
includes students from groups underrepresented in the fields of
science, technology, engineering, and mathematics teaching,
including women and members of minority groups.
(4) Report to congress.--The Under Secretary shall submit
to Congress a biennial report on the activities conducted under
this subsection, including the number of participants and the
new curricula developed in atmospheric and climate sciences.
(l) Clearinghouse of Federal Climate Service Products and Links to
Federal Agencies Providing Climate Services.--
(1) In general.--The Under Secretary shall establish and
maintain a clearinghouse to inform State, local, and tribal
governments and the public about the information and services
available to--
(A) assess the impacts of climate variability and
change at different geographic scales;
(B) characterize and forecast climate variability
and change for specific regions, resources, and
economic sectors; and
(C) develop and implement adaptation strategies to
reduce vulnerabilities to climate variability and
change.
(2) Other resources.--The clearinghouse shall include
hyperlinks to Internet sites that describe the activities,
information, and resources of--
(A) the Federal Government;
(B) State and local governments;
(C) the private sector;
(D) nongovernmental and nonprofit entities and
organizations; and
(E) international organizations.
(m) Financial Burden.--Nothing in this section shall be construed
as authorizing the National Climate Service or the Climate Service
Program at the National Oceanic and Atmospheric Administration to
require State, tribal, or local governments to develop adaptation or
response plans or to take any other action in response to variations in
climate that may result in an increased financial burden to such
governments.
SEC. 453. STATE PROGRAMS TO BUILD RESILIENCE TO CLIMATE CHANGE IMPACTS.
(a) Definitions.--For purposes of this section:
(1) Allowance.--The term ``allowance'' means an emission
allowance established under section 721 of the Clean Air Act
(as added by section 311 of this Act).
(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) Vintage year.--The term ``vintage year'' has the
meaning given that term under section 700 of the Clean Air Act
(as added by section 312 of this Act).
(b) Regulations; Coordination.--Not later than 2 years after the
date of enactment of this Act, the Administrator, or such Federal
agency head or heads as the President may designate, shall promulgate
regulations to implement the requirements of this section. If the
President designates more than 1 Federal agency to implement this
section, the President shall require such agencies to establish a
memorandum of understanding providing for coordination of rulemaking
and other implementing activities, in accordance with the requirements
of this section.
(c) Distribution of Allowances.--
(1) In general.--Not later than September 30 of each of
calendar years 2011 through 2049, the Administrator shall
distribute, in accordance with this section, allowances
allocated for the following vintage year pursuant to section
782(l) of the Clean Air Act (as added by section 321 of this
Act). The Administrator shall reserve 1 percent of such
allowances for distribution to Indian tribes in accordance with
subsection (d). The remainder of such allowances shall be
distributed ratably among the States based on the product of--
(A) each State's population; and
(B) each State's allocation factor as determined
under paragraph (2).
(2) State allocation factors.--
(A) In general.--Except as provided in subparagraph
(B), the allocation factor for a State shall be the
quotient of--
(i) the per capita income of all
individuals in the United States, divided by
(ii) the per capita income of all
individuals in such State.
(B) Limitation.--If the allocation factor for a
State as calculated under subparagraph (A) would exceed
1.2, then the allocation factor for such State shall be
1.2. If the allocation factor for a State as calculated
under subparagraph (A) would be less than 0.8, then the
allocation factor for such State shall be 0.8.
(C) Per capita income.--For purposes of this
paragraph, per capita income shall be--
(i) determined at 2-year intervals; and
(ii) subject to subparagraph (D), equal to
the average of the annual per capita incomes
for the most recent period of 3 consecutive
years for which satisfactory data are available
from the Department of Commerce at the time
such determination is made.
(D) Revenue directly resulting from a
presidentially declared major disaster.--For purposes
of this paragraph, per capita income from one or more
of the following sources shall be reduced or excluded
if the Secretary of Commerce (in consultation with the
Administrator and the secretaries or administrators of
the departments or agencies involved) determines that
the income accrues to persons as the result of a Major
Disaster (as declared by the President of the United
States) and if the Secretary finds that the inclusion
of one or more of these income sources, in whole or in
part, results in a transitory, rather than a
sustainable, increase in a State's per capita income
level relative to the national average:
(i) Property and casualty insurance
(including homeowners and renters insurance).
(ii) The National Flood Insurance Program
of the Federal Emergency Management Agency.
(iii) The Individual and Family Grants
Program of the Federal Emergency Management
Agency.
(iv) The Disaster Housing Program of the
Federal Emergency Management Agency.
(v) The Community Development Block Grant
Program of the Department of Housing and Urban
Development.
(vi) The Disaster Unemployment Assistance
Program of the Department of Labor.
(vii) Any other source determined
appropriate by the Administrator.
(d) Distribution to Indian Tribes.--The Administrator, or such
Federal agency head or heads as the President may designate, shall
promulgate regulations establishing a program to distribute allowances
on a competitive basis to Indian tribes, in accordance with the
requirements of this section. Such allowances shall be used exclusively
in accordance with the requirements of subsection (e). Beginning with
vintage year 2015, Indian tribes with a tribal adaptation plan approved
pursuant to subsection (f) shall be given priority in selection of
programs or projects for receipt of emission allowances under this
subsection.
(e) Use of Allowances.--
(1) In general.--States and Indian tribes shall use
allowances distributed under this section exclusively for the
implementation of projects, programs, or measures to build
resilience to the impacts of climate change, including--
(A) extreme weather events such as flooding and
tropical cyclones;
(B) more frequent heavy precipitation events;
(C) water scarcity and adverse impacts on water
quality;
(D) stronger and longer heat waves;
(E) more frequent and severe droughts;
(F) rises in sea level;
(G) ecosystem disruption;
(H) increased air pollution; and
(I) effects on public health.
(2) Priority in projects to reduce flood events.--When
implementing any project, program, or measure supported under
this section and designed to reduce flood events, a State or
Indian tribe should consider prioritizing projects that seek
to--
(A) mitigate the destructive impacts of climate-
related increases in the duration, frequency, or
magnitude of rainfall or runoff, including snowmelt
runoff, as well as hurricanes;
(B) improve flood protection for densely populated
urban areas; and
(C) mitigate the destructive impact of ocean-
related climate change effects, including effects on
bays, estuaries, populated barrier islands and other
ocean-related features, through a variety of means and
measures, including the construction of jetties,
levies, and other coastal structures in densely
populated coastal areas impacted by climate change.
(3) State and tribal adaptation plans.--Upon approval of a
State or tribal climate adaptation plan under subsection (f),
allowances received by a State under this section shall be used
in accordance with such plan.
(4) Supplement, not supplant.--It is the intent of the
Congress that allowances distributed to carry out this section
should be used to supplement, and not replace, existing sources
of funding used to build resilience to the impacts of climate
change identified in paragraph (1).
(5) Research on hurricanes.--The authorized uses of
allowances under this section shall include establishment of
projects or programs to conduct research and monitoring on the
effect of ongoing climate change on the frequency and intensity
of hurricanes.
(f) State and Tribal Climate Adaptation Plans.--
(1) In general.--The regulations promulgated pursuant to
subsection (b) shall include requirements for submission and
approval of State or tribal climate adaptation plans under this
section. Beginning with vintage year 2015, distribution of
allowances to a State pursuant to this section shall be
contingent on approval of a State climate adaptation plan for
such State that meets the requirements of such regulations.
Requirements for tribal climate adaptation plans may vary from
those of State adaptation plans to the extent necessary to
account for the special circumstances of Indian tribes.
(2) Requirements.--Regulations promulgated under this
section shall require, at minimum, that State and tribal
climate adaptation plans--
(A) assess and prioritize the State's or Indian
tribe's vulnerability to a broad range of impacts of
climate change, based on the best available science;
(B) include an assessment of potential for carbon
reduction through changes to land management policies
(including enhancement or protection of forest carbon
sinks);
(C) identify and prioritize specific cost-effective
projects, programs, and measures to build resilience to
current and predicted impacts of climate change;
(D) ensure that the State or Indian tribe fully
considers and undertakes, to the maximum extent
practicable, initiatives that--
(i) protect or enhance natural ecosystem
functions, including protection, maintenance,
or restoration of natural infrastructure such
as wetlands, reefs, and barrier islands to
buffer communities from floodwaters or storms,
watershed protection to maintain water quality
and groundwater recharge, or floodplain
restoration to improve natural flood control
capacity; or
(ii) use non-structural approaches
including practices that utilize, enhance, or
mimic the natural hydrologic cycle processes of
infiltration, evapotranspiration, and reuse;
(E) be revised and resubmitted for approval not
less frequently than every 5 years; and
(F) be consistent with Federal conservation and
environmental laws and, to the maximum extent
practicable, avoid environmental degradation.
(3) Coordination with prior planning efforts.--In
implementing this subsection, the Administrator, or such
Federal agency head or heads as the President may designate,
shall--
(A) draw upon lessons learned and best practices
from preexisting State and tribal climate adaptation
planning efforts;
(B) seek to avoid duplication of such efforts; and
(C) ensure that the plans developed under this
section reflect and are fully consistent with State
natural resources adaptation plans developed under
section 479 of this Act.
(g) Reporting.--Each State or Indian tribe receiving allowances
under this section shall submit to the Administrator, or such Federal
agency head or heads as the President may designate, within 12 months
after each receipt of such allowances and once every 2 years thereafter
until the value of any allowances received under this section has been
fully expended, a report that--
(1) provides a full accounting for the State's or Indian
tribe's use of allowances distributed under this section,
including a description of the projects, programs, or measures
supported using such allowances;
(2) includes a report prepared by an independent third
party, in accordance with such regulations as are promulgated
by the Administrator or such other Federal agency head or heads
as the President may designate, evaluating the performance of
the projects, programs, or measures supported under this
section; and
(3) identifies any use by the State or Indian tribe of
allowances distributed under this section for the reduction of
flood and storm damage and the effects of climate change on
water and flood protection infrastructure.
(h) Enforcement.--If the Administrator, or such Federal agency head
or heads as the President may designate, determines that a State or
Indian tribe is not in compliance with this section, the Administrator
or such other agency head may withhold a quantity of the allowances
equal to up to twice the quantity of allowances that the State or
Indian tribe failed to use in accordance with the requirements of this
section, that such State or Indian tribe would otherwise be eligible to
receive under this section in 1 or more later years. Allowances
withheld pursuant to this subsection shall be distributed among the
remaining States or Indian tribes ratably in accordance with the
formula in subsection (c) in the case of allowances withheld from a
State, or in accordance with subsection (d) in the case of allowances
withheld from an Indian tribe.
Subpart B--Public Health and Climate Change
SEC. 461. SENSE OF CONGRESS ON PUBLIC HEALTH AND CLIMATE CHANGE.
It is the sense of the Congress that the Federal Government, in
cooperation with international, State, tribal, and local governments,
concerned public and private organizations, and citizens, should use
all practicable means and measures--
(1) to assist the efforts of public health and health care
professionals, first responders, States, tribes,
municipalities, and local communities to incorporate measures
to prepare health systems to respond to the impacts of climate
change;
(2) to ensure--
(A) that the Nation's health professionals have
sufficient information to prepare for and respond to
the adverse health impacts of climate change;
(B) the utility and value of scientific research in
advancing understanding of--
(i) the health impacts of climate change;
and
(ii) strategies to prepare for and respond
to the health impacts of climate change;
(C) the identification of communities vulnerable to
the health effects of climate change and the
development of strategic response plans to be carried
out by health professionals for those communities;
(D) the improvement of health status and health
equity through efforts to prepare for and respond to
climate change; and
(E) the inclusion of health policy in the
development of climate change responses;
(3) to encourage further research, interdisciplinary
partnership, and collaboration among stakeholders in order to--
(A) understand and monitor the health impacts of
climate change; and
(B) improve public health knowledge and response
strategies to climate change;
(4) to enhance preparedness activities, and public health
infrastructure, relating to climate change and health;
(5) to encourage each and every American to learn about the
impacts of climate change on health; and
(6) to assist the efforts of developing nations to
incorporate measures to prepare health systems to respond to
the impacts of climate change.
SEC. 462. RELATIONSHIP TO OTHER LAWS.
Nothing in this subpart in any manner limits the authority provided
to or responsibility conferred on any Federal department or agency by
any provision of any law (including regulations) or authorizes any
violation of any provision of any law (including regulations),
including any health, energy, environmental, transportation, or any
other law or regulation.
SEC. 463. NATIONAL STRATEGIC ACTION PLAN.
(a) Requirement.--
(1) In general.--The Secretary of Health and Human
Services, within 2 years after the date of the enactment of
this Act, on the basis of the best available science, and in
consultation pursuant to paragraph (2), shall publish a
strategic action plan to assist health professionals in
preparing for and responding to the impacts of climate change
on public health in the United States and other nations,
particularly developing nations.
(2) Consultation.--In developing or making any revision to
the national strategic action plan, the Secretary shall--
(A) consult with the Director of the Centers for
Disease Control and Prevention, the Administrator of
the Environmental Protection Agency, the Director of
the National Institutes of Health, the Secretary of
Energy, other appropriate Federal agencies, Indian
tribes, State and local governments, public health
organizations, scientists, and other interested
stakeholders; and
(B) provide opportunity for public input.
(b) Contents.--
(1) In general.--The Secretary, acting through the Director
of the Centers for Disease Control and Prevention and other
appropriate Federal agencies, shall assist health professionals
in preparing for and responding effectively and efficiently to
the health effects of climate change through measures
including--
(A) developing, improving, integrating, and
maintaining domestic and international disease
surveillance systems and monitoring capacity to respond
to health-related effects of climate change, including
on topics addressing--
(i) water, food, and vector borne
infectious diseases and climate change;
(ii) pulmonary effects, including responses
to aeroallergens;
(iii) cardiovascular effects, including
impacts of temperature extremes;
(iv) air pollution health effects,
including heightened sensitivity to air
pollution;
(v) hazardous algal blooms;
(vi) mental and behavioral health impacts
of climate change;
(vii) the health of refugees, displaced
persons, and vulnerable communities;
(viii) the implications for communities
vulnerable to health effects of climate change,
as well as strategies for responding to climate
change within these communities; and
(ix) local and community-based health
interventions for climate-related health
impacts;
(B) creating tools for predicting and monitoring
the public health effects of climate change on the
international, national, regional, State, and local
levels, and providing technical support to assist in
their implementation;
(C) developing public health communications
strategies and interventions for extreme weather events
and disaster response situations;
(D) identifying and prioritizing communities and
populations vulnerable to the health effects of climate
change, and determining actions and communication
strategies that should be taken to inform and protect
these communities and populations from the health
effects of climate change;
(E) developing health communication, public
education, and outreach programs aimed at public health
and health care professionals, as well as the general
public, to promote preparedness and response strategies
relating to climate change and public health, including
the identification of greenhouse gas reduction
behaviors that are health-promoting; and
(F) developing academic and regional centers of
excellence devoted to--
(i) researching relationships between
climate change and health;
(ii) expanding and training the public
health workforce to strengthen the capacity of
such workforce to respond to and prepare for
the health effects of climate change;
(iii) creating and supporting academic
fellowships focusing on the health effects of
climate change; and
(iv) training senior health ministry
officials from developing nations to strengthen
the capacity of such nations to--
(I) prepare for and respond to the
health effects of climate change; and
(II) build an international network
of public health professionals with the
necessary climate change knowledge
base;
(G) using techniques, including health impact
assessments, to assess various climate change public
health preparedness and response strategies on
international, national, State, regional, tribal, and
local levels, and make recommendations as to those
strategies that best protect the public health;
(H)(i) assisting in the development,
implementation, and support of State, regional, tribal,
and local preparedness, communication, and response
plans (including with respect to the health departments
of such entities) to anticipate and reduce the health
threats of climate change; and
(ii) pursuing collaborative efforts to develop,
integrate, and implement such plans;
(I) creating a program to advance research as it
relates to the effects of climate change on public
health across Federal agencies, including research to--
(i) identify and assess climate change
health effects preparedness and response
strategies;
(ii) prioritize critical public health
infrastructure projects related to potential
climate change impacts that affect public
health; and
(iii) coordinate preparedness for climate
change health impacts, including the
development of modeling and forecasting tools;
(J) providing technical assistance for the
development, implementation, and support of
preparedness and response plans to anticipate and
reduce the health threats of climate change in
developing nations; and
(K) carrying out other activities determined
appropriate by the Secretary to plan for and respond to
the impacts of climate change on public health.
(c) Revision.--The Secretary shall revise the national strategic
action plan not later than July 1, 2014, and every 4 years thereafter,
to reflect new information collected pursuant to implementation of the
national strategic action plan and otherwise, including information
on--
(1) the status of critical environmental health parameters
and related human health impacts;
(2) the impacts of climate change on public health; and
(3) advances in the development of strategies for preparing
for and responding to the impacts of climate change on public
health.
(d) Implementation.--
(1) Implementation through hhs.--The Secretary shall
exercise the Secretary's authority under this subpart and other
provisions of Federal law to achieve the goals and measures of
the national strategic action plan.
(2) Other public health programs and initiatives.--The
Secretary and Federal officials of other relevant Federal
agencies shall administer public health programs and
initiatives authorized by provisions of law other than this
subpart, subject to the requirements of such statutes, in a
manner designed to achieve the goals of the national strategic
action plan.
(3) CDC.--In furtherance of the national strategic action
plan, the Secretary, acting through the Director of the Centers
for Disease Control and Prevention and the head of any other
appropriate Federal agency, shall--
(A) conduct scientific research to assist health
professionals in preparing for and responding to the
impacts of climate change on public health; and
(B) provide funding for--
(i) research on the health effects of
climate change; and
(ii) preparedness planning on the
international, national, State, tribal,
regional, and local levels to respond to or
reduce the burden of health effects of climate
change; and
(C) carry out other activities determined
appropriate by the Director or the head of such agency
to prepare for and respond to the impacts of climate
change on public health.
SEC. 464. ADVISORY BOARD.
(a) Establishment.--The Secretary shall establish a permanent
science advisory board comprised of not less than 10 and not more than
20 members.
(b) Appointment of Members.--The Secretary shall appoint the
members of the science advisory board from among individuals--
(1) who have expertise in public health and human services,
climate change, and other relevant disciplines; and
(2) at least \1/2\ of whom are recommended by the President
of the National Academy of Sciences.
(c) Functions.--The science advisory board shall--
(1) provide scientific and technical advice and
recommendations to the Secretary on the domestic and
international impacts of climate change on public health,
populations and regions particularly vulnerable to the effects
of climate change, and strategies and mechanisms to prepare for
and respond to the impacts of climate change on public health;
and
(2) advise the Secretary regarding the best science
available for purposes of issuing the national strategic action
plan.
SEC. 465. REPORTS.
(a) Needs Assessment.--
(1) In general.--The Secretary shall seek to enter into, by
not later than 6 months after the date of the enactment of this
Act, an agreement with the National Research Council and the
Institute of Medicine to complete a report that--
(A) assesses the needs for health professionals to
prepare for and respond to climate change impacts on
public health; and
(B) recommends programs to meet those needs.
(2) Submission.--The agreement under paragraph (1) shall
require the completed report to be submitted to the Congress
and the Secretary and made publicly available not later than 1
year after the date of the agreement.
(b) Climate Change Health Protection and Promotion Reports.--
(1) In general.--The Secretary, in consultation with the
advisory board established under section 464, shall ensure the
issuance of reports to aid health professionals in preparing
for and responding to the adverse health effects of climate
change that--
(A) review scientific developments on health
impacts of climate change; and
(B) recommend changes to the national strategic
action plan.
(2) Submission.--The Secretary shall submit the reports
required by paragraph (1) to the Congress and make such reports
publicly available not later than July 1, 2013, and every 4
years thereafter.
SEC. 466. DEFINITIONS.
In this subpart:
(1) Health impact assessment.--The term ``health impact
assessment'' means a combination of procedures, methods, and
tools by which a policy, program, or project may be judged as
to its potential effects on the health of a population, and the
distribution of those effects within the population.
(2) National strategic action plan.--The term ``national
strategic action plan'' means the plan issued and revised under
section 463.
(3) Secretary.--Unless otherwise specified, the term
``Secretary'' means the Secretary of Health and Human Services.
SEC. 467. CLIMATE CHANGE HEALTH PROTECTION AND PROMOTION FUND.
(a) Establishment of Fund.--Subject to subtitle F of title IV,
there is hereby established in the Treasury a separate account that
shall be known as the Climate Change Health Protection and Promotion
Fund.
(b) Availability of Amounts.--Subject to subtitle F of title IV,
all amounts deposited into the Climate Change Health Protection and
Promotion Fund shall be available to the Secretary to carry out this
subpart subject to further appropriation.
(c) Distribution of Funds by HHS.--In carrying out this subpart,
the Secretary may make funds deposited in the Climate Change Health
Protection and Promotion Fund available to--
(1) other departments, agencies, and offices of the Federal
Government;
(2) foreign, State, tribal, and local governments; and
(3) such other entities as the Secretary determines
appropriate.
(d) Supplement, Not Replace.--It is the intent of Congress that
funds made available to carry out this subpart should be used to
supplement, and not replace, existing sources of funding for public
health.
Subpart C--Natural Resource Adaptation
SEC. 471. PURPOSES.
The purposes of this subpart are to--
(1) establish an integrated Federal program to protect,
restore, and conserve the Nation's natural resources in
response to the threats of climate change and ocean
acidification; and
(2) provide financial support and incentives for programs,
strategies, and activities that protect, restore, and conserve
the Nation's natural resources in response to the threats of
climate change and ocean acidification.
SEC. 472. NATURAL RESOURCES CLIMATE CHANGE ADAPTATION POLICY.
It is the policy of the Federal Government, in cooperation with
State and local governments, Indian tribes, and other interested
stakeholders to use all practicable means and measures to protect,
restore, and conserve natural resources to enable them to become more
resilient, adapt to, and withstand the impacts of climate change and
ocean acidification.
SEC. 473. DEFINITIONS.
In this subpart:
(1) Coastal state.--The term ``coastal State'' has the
meaning given the term in section 304 of the Coastal Zone
Management Act of 1972 (16 U.S.C. 1453).
(2) Corridors.--The term ``corridors'' means areas that
provide connectivity, over different time scales (including
seasonal or longer), of habitat or potential habitat and that
facilitate the ability of terrestrial, marine, estuarine, and
freshwater fish, wildlife, or plants to move within a landscape
as needed for migration, gene flow, or dispersal, or in
response to the impacts of climate change and ocean
acidification or other impacts.
(3) Ecological processes.--The term ``ecological
processes'' means biological, chemical, or physical interaction
between the biotic and abiotic components of an ecosystem and
includes--
(A) nutrient cycling;
(B) pollination;
(C) predator-prey relationships;
(D) soil formation;
(E) gene flow;
(F) disease epizootiology;
(G) larval dispersal and settlement;
(H) hydrological cycling;
(I) decomposition; and
(J) disturbance regimes such as fire and flooding.
(4) Habitat.--The term ``habitat'' means the physical,
chemical, and biological properties that are used by fish,
wildlife, or plants for growth, reproduction, survival, food,
water, and cover, on a tract of land, in a body of water, or in
an area or region.
(5) 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).
(6) Natural resources.--The term ``natural resources''
means the terrestrial, freshwater, estuarine, and marine fish,
wildlife, plants, land, water, habitats, and ecosystems of the
United States.
(7) Natural resources adaptation.--The term ``natural
resources adaptation'' means the protection, restoration, and
conservation of natural resources to enable them to become more
resilient, adapt to, and withstand the impacts of climate
change and ocean acidification.
(8) Resilience.--Each of the terms ``resilience'' and
``resilient'' means the ability to resist or recover from
disturbance and preserve diversity, productivity, and
sustainability.
(9) State.--The term ``State'' means--
(A) a State of the United States;
(B) the District of Columbia; and
(C) the Commonwealth of Puerto Rico, Guam, the
United States Virgin Islands, the Northern Mariana
Islands, and American Samoa.
SEC. 474. COUNCIL ON ENVIRONMENTAL QUALITY.
The Chair of the Council on Environmental Quality shall--
(1) advise the President on implementation and development
of--
(A) a Natural Resources Climate Change Adaptation
Strategy required under section 476; and
(B) Federal natural resource agency adaptation
plans required under section 478;
(2) serve as the Chair of the Natural Resources Climate
Change Adaptation Panel established under section 475; and
(3) coordinate Federal agency strategies, plans, programs,
and activities related to protecting, restoring, and
maintaining natural resources to become more resilient, adapt
to, and withstand the impacts of climate change and ocean
acidification.
SEC. 475. NATURAL RESOURCES CLIMATE CHANGE ADAPTATION PANEL.
(a) Establishment.--Not later than 90 days after the date of the
enactment of this subpart, the President shall establish a Natural
Resources Climate Change Adaptation Panel, consisting of--
(1) the head, or their designee, of each of--
(A) the National Oceanic and Atmospheric
Administration;
(B) the Forest Service;
(C) the National Park Service;
(D) the United States Fish and Wildlife Service;
(E) the Bureau of Land Management;
(F) the United States Geological Survey;
(G) the Bureau of Reclamation;
(H) the Bureau of Indian Affairs;
(I) the Environmental Protection Agency; and
(J) the Army Corps of Engineers;
(2) the Chair of the Council on Environmental Quality; and
(3) the heads of such other Federal agencies or departments
with jurisdiction over natural resources of the United States,
as determined by the President.
(b) Functions.--The Panel shall serve as a forum for interagency
consultation on and the coordination of the development and
implementation of a national Natural Resources Climate Change
Adaptation Strategy required under section 476.
(c) Chair.--The Chair of the Council on Environmental Quality shall
serve as the Chair of the Panel.
SEC. 476. NATURAL RESOURCES CLIMATE CHANGE ADAPTATION STRATEGY.
(a) In General.--Not later than 1 year after the date of the
enactment of this subpart, the President, through the Natural Resources
Climate Change Adaptation Panel established under section 475, shall
develop a Natural Resources Climate Change Adaptation Strategy to
protect, restore, and conserve natural resources to enable them to
become more resilient, adapt to, and withstand the impacts of climate
change and ocean acidification and to identify opportunities to
mitigate those impacts.
(b) Development and Revision.--In developing and revising the
Strategy, the Panel shall--
(1) base the strategy on the best available science;
(2) develop the strategy in close cooperation with States
and Indian tribes;
(3) coordinate with other Federal agencies as appropriate;
(4) consult with local governments, conservation
organizations, scientists, and other interested stakeholders;
(5) provide public notice and opportunity for comment; and
(6) review and revise the Strategy every 5 years to
incorporate new information regarding the impacts of climate
change and ocean acidification on natural resources and
advances in the development of strategies for becoming more
resilient and adapting to those impacts.
(c) Contents.--The National Resources Adaptation Strategy shall
include--
(1) an assessment of the vulnerability of natural resources
to climate change and ocean acidification, including the short-
term, medium-term, long-term, cumulative, and synergistic
impacts;
(2) a description of current research, observation, and
monitoring activities at the Federal, State, tribal, and local
level related to the impacts of climate change and ocean
acidification on natural resources, as well as identification
of research and data needs and priorities;
(3) identification of natural resources that are likely to
have the greatest need for protection, restoration, and
conservation because of the adverse effects of climate change
and ocean acidification;
(4) specific protocols for integrating climate change and
ocean acidification adaptation strategies and activities into
the conservation and management of natural resources by Federal
departments and agencies to ensure consistency across agency
jurisdictions and resources;
(5) specific actions that Federal departments and agencies
shall take to protect, conserve, and restore natural resources
to become more resilient, adapt to, and withstand the impacts
of climate change and ocean acidification, including a timeline
to implement those actions;
(6) specific mechanisms for ensuring communication and
coordination among Federal departments and agencies, and
between Federal departments and agencies and State natural
resource agencies, United States territories, Indian tribes,
private landowners, conservation organizations, and other
nations that share jurisdiction over natural resources with the
United States;
(7) specific actions to develop and implement consistent
natural resources inventory and monitoring protocols through
interagency coordination and collaboration; and
(8) a process for guiding the development of detailed
agency- and department-specific adaptation plans required under
section 478 to address the impacts of climate change and ocean
acidification on the natural resources in the jurisdiction of
each agency.
(d) Implementation.--Consistent with its authorities under other
laws and with Federal trust responsibilities with respect to Indian
lands, each Federal department or agency with representation on the
National Resources Climate Change Adaptation Panel shall consider the
impacts of climate change and ocean acidification and integrate the
elements of the strategy into agency plans, environmental reviews,
programs, and activities related to the conservation, restoration, and
management of natural resources.
SEC. 477. NATURAL RESOURCES ADAPTATION SCIENCE AND INFORMATION.
(a) Coordination.--Not later than 90 days after the date of the
enactment of this subpart, the Secretary of Commerce, acting through
the Administrator of the National Oceanic and Atmospheric
Administration, and the Secretary of the Interior, acting through the
Director of the United States Geological Survey, shall establish a
coordinated process for developing and providing science and
information needed to assess and address the impacts of climate change
and ocean acidification on natural resources. The process shall be led
by the National Climate Change and Wildlife Science Center established
within the United States Geological Survey under subsection (d) and the
National Climate Service of the National Oceanic and Atmospheric
Administration.
(b) Functions.--The Secretaries shall ensure that such process
avoids duplication and that the National Oceanic and Atmospheric
Administration and the United States Geological Survey shall--
(1) provide technical assistance to Federal departments and
agencies, State and local governments, Indian tribes, and
interested private landowners in their efforts to assess and
address the impacts of climate change and ocean acidification
on natural resources;
(2) conduct and sponsor research and provide Federal
departments and agencies, State and local governments, Indian
tribes, and interested private landowners with research
products, decision and monitoring tools and information, to
develop strategies for assisting natural resources to become
more resilient, adapt to, and withstand the impacts of climate
change and ocean acidification; and
(3) assist Federal departments and agencies in the
development of the adaptation plans required under section 478.
(c) Survey.--Not later than 1 year after the date of enactment of
this subpart and every 5 years thereafter, the Secretary of Commerce
and the Secretary of the Interior shall undertake a climate change and
ocean acidification impact survey that--
(1) identifies natural resources considered likely to be
adversely affected by climate change and ocean acidification;
(2) includes baseline monitoring and ongoing trend
analysis;
(3) uses a stakeholder process to identify and prioritize
needed monitoring and research that is of greatest relevance to
the ongoing needs of natural resource managers to address the
impacts of climate change and ocean acidification; and
(4) identifies decision tools necessary to develop
strategies for assisting natural resources to become more
resilient and adapt to and withstand the impacts of climate
change and ocean acidification.
(d) National Climate Change and Wildlife Science Center.--
(1) Establishment.--The Secretary of the Interior shall
establish the National Climate Change and Wildlife Science
Center within the United States Geological Survey.
(2) Functions.--The Center shall, in collaboration with
Federal and State natural resources agencies and departments,
Indian tribes, universities, and other partner organizations--
(A) assess and synthesize current physical and
biological knowledge and prioritize scientific gaps in
such knowledge in order to forecast the ecological
impacts of climate change on fish and wildlife at the
ecosystem, habitat, community, population, and species
levels;
(B) develop and improve tools to identify,
evaluate, and, where appropriate, link scientific
approaches and models for forecasting the impacts of
climate change and adaptation on fish, wildlife,
plants, and their habitats, including monitoring,
predictive models, vulnerability analyses, risk
assessments, and decision support systems to help
managers make informed decisions;
(C) develop and evaluate tools to adaptively manage
and monitor the effects of climate change on fish and
wildlife at national, regional, and local scales; and
(D) develop capacities for sharing standardized
data and the synthesis of such data.
(e) Science Advisory Board.--
(1) Establishment.--Not later than 180 days after the date
of enactment of this subpart, the Secretary of Commerce and the
Secretary of the Interior shall establish and appoint the
members of a Science Advisory Board, to be comprised of not
fewer than 10 and not more than 20 members--
(A) who have expertise in fish, wildlife, plant,
aquatic, and coastal and marine biology, ecology,
climate change, ocean acidification, and other relevant
scientific disciplines;
(B) who represent a balanced membership among
Federal, State, Indian tribes, and local
representatives, universities, and conservation
organizations; and
(C) at least \1/2\ of whom are recommended by the
President of the National Academy of Sciences.
(2) Duties.--The Science Advisory Board shall--
(A) advise the Secretaries on the state-of-the-
science regarding the impacts of climate change and
ocean acidification on natural resources and scientific
strategies and mechanisms for protecting, restoring,
and conserving natural resources to enable them to
become more resilient, adapt to, and withstand the
impacts of climate change and ocean acidification; and
(B) identify and recommend priorities for ongoing
research needs on such issues.
(3) Collaboration.--The Science Advisory Board shall
collaborate with other climate change and ecosystem research
entities in other Federal agencies and departments.
(4) Availability to the public.--The advice and
recommendations of the Science Advisory Board shall be made
available to the public.
SEC. 478. FEDERAL NATURAL RESOURCE AGENCY ADAPTATION PLANS.
(a) Development.--Not later than 1 year after the date of the
development of a Natural Resources Climate Change Adaptation Strategy
under section 476, each department or agency that has a representative
on the Natural Resources Climate Change Adaptation Panel established
under section 475 shall--
(1) complete an adaptation plan for that department or
agency, respectively, implementing the Natural Resources
Climate Change Adaptation Strategy under section 476 and
consistent with the Natural Resources Climate Change Adaptation
Policy under section 472, detailing the department's or
agency's current and projected efforts to address the potential
impacts of climate change and ocean acidification on natural
resources within the department's or agency's jurisdiction and
necessary additional actions, including a timeline for
implementation of those actions;
(2) provide opportunities for review and comment on that
adaptation plan by the public, including in the case of a plan
by the Bureau of Indian Affairs, review by Indian tribes; and
(3) submit such plan to the President for approval.
(b) Review by President and Submission to Congress.--
(1) Review by president.--The President shall--
(A) approve an adaptation plan submitted under
subsection (a)(3) if the plan meets the requirements of
subsection (c) and is consistent with the strategy
developed under section 476;
(B) decide whether to approve the plan within 60
days after submission; and
(C) if the President disapproves a plan, direct the
department or agency to submit a revised plan to the
President under subsection (a)(3) within 60 days after
such disapproval.
(2) Submission to congress.--Not later than 30 days after
the date of approval of such adaptation plan by the President,
the department or agency shall submit the approved plan to the
Committee on Natural Resources of the House of Representatives,
the Committee on Energy and Natural Resources of the Senate,
and the committees of the House of Representatives and the
Senate with principal jurisdiction over the department or
agency.
(c) Requirements.--Each adaptation plan shall--
(1) establish programs for assessing the current and future
impacts of climate change and ocean acidification on natural
resources within the department's or agency's, respectively,
jurisdiction, including cumulative and synergistic effects, and
for identifying and monitoring those natural resources that are
likely to be adversely affected and that have need for
conservation;
(2) identify and prioritize the department's or agency's
strategies and specific conservation actions to address the
current and future impacts of climate change and ocean
acidification on natural resources within the scope of the
department's or agency's jurisdiction and to develop and
implement strategies to protect, restore, and conserve such
resources to become more resilient, adapt to, and better
withstand those impacts, including--
(A) the protection, restoration, and conservation
of terrestrial, marine, estuarine, and freshwater
habitats and ecosystems;
(B) the establishment of terrestrial, marine,
estuarine, and freshwater habitat linkages and
corridors;
(C) the restoration and conservation of ecological
processes;
(D) the protection of a broad diversity of native
species of fish, wildlife, and plant populations across
their range; and
(E) the protection of fish, wildlife, and plant
health, recognizing that climate can alter the
distribution and ecology of parasites, pathogens, and
vectors;
(3) describe how the department or agency will integrate
such strategies and conservation activities into plans,
programs, activities, and actions of the department or agency,
related to the conservation and management of natural resources
and establish new plans, programs, activities, and actions as
necessary;
(4) establish methods for assessing the effectiveness of
strategies and conservation actions taken to protect, restore,
and conserve natural resources to enable them to become more
resilient, adapt to, and withstand the impacts of climate
change and ocean acidification, and for updating those
strategies and actions to respond to new information and
changing conditions;
(5) include a description of current and proposed
mechanisms to enhance cooperation and coordination of natural
resources adaptation efforts with other Federal agencies, State
and local governments, Indian tribes, and nongovernmental
stakeholders;
(6) include specific written guidance to resource managers
to--
(A) explain how managers are expected to address
the effects of climate change and ocean acidification;
(B) identify how managers are to obtain any site-
specific information that may be necessary; and
(C) reflect best practices shared among relevant
agencies, while also recognizing the unique missions,
objectives, and responsibilities of each agency; and
(7) identify and assess data and information gaps necessary
to develop natural resources adaptation plans and strategies.
(d) Implementation.--
(1) In general.--Upon approval by the President, each
department or agency that serves on the Natural Resources
Climate Change Adaptation Panel shall implement its adaptation
plan through existing and new plans, policies, programs,
activities, and actions to the extent not inconsistent with
existing authority.
(2) Consideration of impacts.--
(A) In general.--To the maximum extent practicable
and consistent with applicable law, every natural
resource management decision made by the department or
agency shall consider the impacts of climate change and
ocean acidification on those natural resources.
(B) Guidance.--The Council on Environmental Quality
shall issue guidance for Federal departments and
agencies for considering those impacts.
(e) Revision and Review.--Not less than every 5 years, each
adaptation plan under this section shall be reviewed and revised to
incorporate the best available science and other information regarding
the impacts of climate change and ocean acidification on natural
resources.
SEC. 479. STATE NATURAL RESOURCES ADAPTATION PLANS.
(a) Requirement.--In order to be eligible for funds under section
480, not later than 1 year after the development of a Natural Resources
Climate Change Adaptation Strategy required under section 476 each
State shall prepare a State natural resources adaptation plan detailing
the State's current and projected efforts to address the potential
impacts of climate change and ocean acidification on natural resources
and coastal areas within the State's jurisdiction.
(b) Review or Approval.--
(1) In general.--Each State adaptation plan shall be
reviewed and approved or disapproved by the Secretary of the
Interior and, as applicable, the Secretary of Commerce. Such
approval shall be granted if the plan meets the requirements of
subsection (c) and is consistent with the Natural Resources
Climate Change Adaptation Strategy required under section 476.
(2) Approval or disapproval.--Within 180 days after
transmittal of such a plan, or a revision to such a plan, the
Secretary of the Interior and, as applicable, the Secretary of
Commerce shall approve or disapprove the plan by written
notice.
(3) Resubmittal.--Within 90 days after transmittal of a
resubmitted adaptation plan as a result of disapproval under
paragraph (3), the Secretary of the Interior and, as
applicable, the Secretary of Commerce, shall approve or
disapprove the plan by written notice.
(c) Contents.--A State natural resources adaptation plan shall--
(1) include a strategy for addressing the impacts of
climate change and ocean acidification on terrestrial, marine,
estuarine, and freshwater fish, wildlife, plants, habitats,
ecosystems, wildlife health, and ecological processes, that--
(A) describes the impacts of climate change and
ocean acidification on the diversity and health of the
fish, wildlife and plant populations, habitats,
ecosystems, and associated ecological processes;
(B) establishes programs for monitoring the impacts
of climate change and ocean acidification on fish,
wildlife, and plant populations, habitats, ecosystems,
and associated ecological processes;
(C) describes and prioritizes proposed conservation
actions to assist fish, wildlife, plant populations,
habitats, ecosystems, and associated ecological
processes in becoming more resilient, adapting to, and
better withstanding those impacts;
(D) includes strategies, specific conservation
actions, and a time frame for implementing conservation
actions for fish, wildlife, and plant populations,
habitats, ecosystems, and associated ecological
processes;
(E) establishes methods for assessing the
effectiveness of strategies and conservation actions
taken to assist fish, wildlife, and plant populations,
habitats, ecosystems, and associated ecological
processes in becoming more resilient, adapt to, and
better withstand the impacts of climate changes and
ocean acidification and for updating those strategies
and actions to respond appropriately to new information
or changing conditions;
(F) is incorporated into a revision of the State
wildlife action plan (also known as the State
comprehensive wildlife strategy)--
(i) that has been submitted to the United
States Fish and Wildlife Service; and
(ii) that has been approved by the Service
or on which a decision on approval is pending;
and
(G) is developed--
(i) with the participation of the State
fish and wildlife agency, the State coastal
agency, the State agency responsible for
administration of Land and Water Conservation
Fund grants, the State Forest Legacy program
coordinator, and other State agencies
considered appropriate by the Governor of such
State; and
(ii) in coordination with the Secretary of
the Interior, and where applicable, the
Secretary of Commerce and other States that
share jurisdiction over natural resources with
the State; and
(2) include, in the case of a coastal State, a strategy for
addressing the impacts of climate change and ocean
acidification on the coastal zone that--
(A) identifies natural resources that are likely to
be impacted by climate change and ocean acidification
and describes those impacts;
(B) identifies and prioritizes continuing research
and data collection needed to address those impacts
including--
(i) acquisition of high resolution coastal
elevation and nearshore bathymetry data;
(ii) historic shoreline position maps,
erosion rates, and inventories of shoreline
features and structures;
(iii) measures and models of relative rates
of sea level rise or lake level changes,
including effects on flooding, storm surge,
inundation, and coastal geological processes;
(iv) habitat loss, including projected
losses of coastal wetlands and potentials for
inland migration of natural shoreline habitats;
(v) ocean and coastal species and ecosystem
migrations, and changes in species population
dynamics;
(vi) changes in storm frequency, intensity,
or rainfall patterns;
(vii) saltwater intrusion into coastal
rivers and aquifers;
(viii) changes in chemical or physical
characteristics of marine and estuarine
systems;
(ix) increased harmful algal blooms; and
(x) spread of invasive species;
(C) identifies and prioritizes adaptation
strategies to protect, restore, and conserve natural
resources to enable them to become more resilient,
adapt to, and withstand the impacts of climate change
and ocean acidification, including--
(i) protection, maintenance, and
restoration of ecologically important coastal
lands, coastal and ocean ecosystems, and
species biodiversity and the establishment of
habitat buffer zones, migration corridors, and
climate refugia; and
(ii) improved planning, siting policies,
and hazard mitigation strategies;
(D) establishes programs for the long-term
monitoring of the impacts of climate change and ocean
acidification on the ocean and coastal zone and to
assess and adjust, when necessary, such adaptive
management strategies;
(E) establishes performance measures for assessing
the effectiveness of adaptation strategies intended to
improve resilience and the ability of natural resources
in the coastal zone to adapt to and withstand the
impacts of climate change and ocean acidification and
of adaptation strategies intended to minimize those
impacts on the coastal zone and to update those
strategies to respond to new information or changing
conditions; and
(F) is developed with the participation of the
State coastal agency and other appropriate State
agencies and in coordination with the Secretary of
Commerce and other appropriate Federal agencies.
(d) Public Input.--States shall provide for solicitation and
consideration of public and independent scientific input in the
development of their plans.
(e) Coordination With Other Plans.--The State plan shall take into
consideration research and information contained in, and coordinate
with and integrate the goals and measures identified in, as
appropriate, other natural resources conservation strategies,
including--
(1) the national fish habitat action plan;
(2) plans under the North American Wetlands Conservation
Act (16 U.S.C. 4401 et seq.);
(3) the Federal, State, and local partnership known as
``Partners in Flight'';
(4) federally approved coastal zone management plans under
the Coastal Zone Management Act of 1972 (16 U.S.C. 1451 et
seq.);
(5) federally approved regional fishery management plants
and habitat conservation activities under the Magnuson-Stevens
Fishery Conservation and Management Act (16 U.S.C. 1801 et
seq.);
(6) the national coral reef action plan;
(7) recovery plans for threatened species and endangered
species under section 4(f) of the Endangered Species Act of
1973 (16 U.S.C. 1533(f));
(8) habitat conservation plans under section 10 of that Act
(16 U.S.C. 1539);
(9) other Federal, State, and tribal plans for imperiled
species;
(10) State or tribal hazard mitigation plans;
(11) State or tribal water management plans; and
(12) other State-based strategies that comprehensively
implement adaptation activities to remediate the effects of
climate change and ocean acidification on terrestrial, marine,
and freshwater fish, wildlife, plants, and other natural
resources.
(f) Updating.--Each State plan shall be updated not less than every
5 years.
(g) Funding.--
(1) In general.--Funds allocated to States under section
480 shall be used only for activities that are consistent with
a State natural resources adaptation plan that has been
approved by the Secretaries of Interior and Commerce.
(2) Funding prior to the approval of a state plan.--Until
the earlier of the date that is 3 years after the date of the
enactment of this subpart or the date on which a State receives
approval for the State strategy, a State shall be eligible to
receive funding under section 480 for adaptation activities
that are--
(A) consistent with the comprehensive wildlife
strategy of the State and, where appropriate, other
natural resources conservation strategies; and
(B) in accordance with a workplan developed in
coordination with--
(i) the Secretary of the Interior; and
(ii) the Secretary of Commerce, for any
coastal State subject to the condition that
coordination with the Secretary of Commerce
shall be required only for those portions of
the strategy relating to activities affecting
the coastal zone.
(3) Pending approval.--During the period for which approval
by the applicable Secretary of a State plan is pending, the
State may continue receiving funds under section 480 pursuant
to the workplan described in paragraph (2)(B).
SEC. 480. NATURAL RESOURCES CLIMATE CHANGE ADAPTATION FUND.
(a) Allocations to States.--100 percent of the emission allowances
made available for each year to carry out this subpart shall be
provided to States to carry out natural resources adaptation activities
in accordance with State natural resources adaptation plans approved
under section 479. Specifically--
(1) 84.4 percent shall be available to State wildlife
agencies in accordance with the apportionment formula
established under the second subsection (c) of section 4 of the
Pittman-Robertson Wildlife Restoration Act (16 U.S.C. 669c), as
added by section 902(e) of H.R. 5548 as introduced in the 106th
Congress and enacted into law by section 1(a)(2) of Public Law
106-553 (114 Stat. 2762A-119); and
(2) 15.6 percent shall be available to State coastal
agencies pursuant to the formula established by the Secretary
of Commerce under section 306(c) of the Coastal Management Act
of 1972 (16 U.S.C. 1455(c)).
(b) Establishment of Fund.--
(1) Establishment.--Subject to subtitle F of title IV,
there is hereby established in the Treasury a separate account
that shall be known as the Natural Resources Climate Change
Adaptation Fund.
(2) Authorization of appropriations.--Subject to subtitle F
of title IV, there are authorized to be appropriated for
subsection (c) such sums as are deposited in the Natural
Resources Climate Change Fund, and the amounts appropriated for
subsection (c) shall be no less than the total estimated annual
deposits in the Natural Resources Climate Change Adaptation
Fund.
(c) Allocations to Federal Agencies.--
(1) Department of the interior.--Of the amounts made
available for each fiscal year to carry out this subpart--
(A) 27.6 percent shall be allocated to the
Secretary of the Interior for use in funding--
(i) natural resources adaptation activities
carried out--
(I) under endangered species,
migratory species, and other fish and
wildlife programs administered by the
National Park Service, the United
States Fish and Wildlife Service, the
Bureau of Indian Affairs, and the
Bureau of Land Management;
(II) on wildlife refuges, National
Park Service land, and other public
land under the jurisdiction of the
United States Fish and Wildlife
Service, the Bureau of Land Management,
the Bureau of Indian Affairs, or the
National Park Service; or
(III) within Federal water managed
by the Bureau of Reclamation and the
National Park Service; and
(ii) for the implementation of the National
Fish and Wildlife Habitat and Corridors
Identification Program pursuant to section 481;
(B) 8.1 percent shall be allocated to the Secretary
of the Interior for natural resources adaptation
activities carried out under cooperative grant
programs, including--
(i) the cooperative endangered species
conservation fund authorized under section 6 of
the Endangered Species Act of 1973 (16 U.S.C.
1535);
(ii) programs under the North American
Wetlands Conservation Act (16 U.S.C. 4401 et
seq.);
(iii) the Neotropical Migratory Bird
Conservation Fund established by section 478(a)
of the Neotropical Migratory Bird Conservation
Act (16 U.S.C. 6108(a));
(iv) the Coastal Program of the United
States Fish and Wildlife Service;
(v) the National Fish Habitat Action Plan;
(vi) the Partners for Fish and Wildlife
Program;
(vii) the Landowner Incentive Program;
(viii) the Wildlife Without Borders Program
of the United States Fish and Wildlife Service;
and
(ix) the Migratory Species Program and Park
Flight Migratory Bird Program of the National
Park Service; and
(C) 4.9 percent shall be allocated to the Secretary
of the Interior to provide financial assistance to
Indian tribes to carry out natural resources adaptation
activities through the Tribal Wildlife Grants Program
of the United States Fish and Wildlife Service and in
accordance with the Indian Self-Determination and
Educational Assistance Act (25 U.S.C. 450(f)).
(2) Land and water conservation fund.--
(A) Deposits.--
(i) In general.--Of the amounts made
available for each fiscal year to carry out
this subpart, 19.5 percent shall be deposited
into the Land and Water Conservation Fund
established under section 2 of the Land and
Water Conservation Fund Act of 1965 (16 U.S.C.
460l-5).
(ii) Use of deposits.-- (I) Deposits into
the Land and Water Conservation Fund under this
paragraph shall be supplemental to
authorizations provided under section 3 of the
Land and Water Conservation Fund Act of 1965
(16 U.S.C. 460l-6), which shall remain
available for nonadaptation needs.
(II) There are authorized to be
appropriated for activities in this subpart
such sums as are deposited in the Land and
Water Conservation Fund pursuant to section
480(c)(3)(A)(ii), and the amounts appropriated
for this paragraph shall be no less than the
total estimated annual deposits in the Land and
Water Conservation Fund.
(B) Allocations.--Of the amounts deposited under
this paragraph into the Land and Water Conservation
Fund--
(i) \1/6\ shall be allocated to the
Secretary of the Interior and made available on
a competitive basis to carry out natural
resources adaptation activities through the
acquisition of land and interests in land under
section 6 of the Land and Water Conservation
Fund Act of 1965 (16 U.S.C. 460l-8)--
(I) to States in accordance with
their natural resources adaptation
plans, and to Indian tribes;
(II) notwithstanding section 5 of
that Act (16 U.S.C. 460l-7); and
(III) in addition to any funds
provided pursuant to annual
appropriations Acts, the Energy Policy
Act of 2005 (42 U.S.C. 15801 et seq.),
or any other authorization for
nonadaptation needs;
(ii) \1/3\ shall be allocated to the
Secretary of the Interior to carry out natural
resources adaptation activities through the
acquisition of lands and interests in land
under section 7 of the Land and Water
Conservation Fund Act of 1965 (16 U.S.C. 460l-
9);
(iii) \1/6\ shall be allocated to the
Secretary of Agriculture and made available to
the States and Indian tribes to carry out
natural resources adaptation activities through
the acquisition of land and interests in land
under section 7 of the Forest Legacy Program
under the Cooperative Forestry Assistance Act
of 1978 (16 U.S.C. 2103c); and
(iv) \1/3\ shall be allocated to the
Secretary of Agriculture to carry out natural
resources adaptation activities through the
acquisition of land and interests in land under
section 7 of the Land and Water Conservation
Fund Act of 1965 (16 U.S.C. 460l-9).
(C) Expenditure of funds.--In allocating funds
under subparagraph (B), the Secretary of the Interior
and the Secretary of Agriculture shall take into
consideration factors including--
(i) the availability of non-Federal
contributions from State, local, or private
sources;
(ii) opportunities to protect fish and
wildlife corridors or otherwise to link or
consolidate fragmented habitats;
(iii) opportunities to reduce the risk of
catastrophic wildfires, drought, extreme
flooding, or other climate-related events that
are harmful to fish and wildlife and people;
and
(iv) the potential for conservation of
species or habitat types at serious risk due to
climate change, ocean acidification, and other
stressors.
(3) Forest service.--Of the amounts made available for each
fiscal year to carry out this subpart, 8.1 percent shall be
allocated to the Secretary of Agriculture for use in funding
natural resources adaptation activities carried out on national
forests and national grasslands under the jurisdiction of the
Forest Service and for natural resource adaptation activities
on State and private forest lands carried out under the
Cooperative Forestry Assistance Act of 1978.
(4) Department of commerce.--Of the amounts made available
for each fiscal year to carry out this subpart, 11.5 percent
shall be allocated to the Secretary of Commerce for use in
funding natural resources adaptation activities to protect,
maintain, and restore coastal, estuarine, and marine resources,
habitats, and ecosystems, including such activities carried out
under--
(A) the coastal and estuarine land conservation
program;
(B) the community-based restoration program;
(C) the Coastal Zone Management Act of 1972 (16
U.S.C. 1451 et seq.), that are specifically designed to
strengthen the ability of coastal, estuarine, and
marine resources, habitats, and ecosystems to adapt to
and withstand the impacts of climate change and ocean
acidification;
(D) the Open Rivers Initiative;
(E) the Magnuson-Stevens Fishery Conservation and
Management Act (16 U.S.C. 1801 et seq.);
(F) the Marine Mammal Protection Act of 1972 (16
U.S.C. 1361 et seq.);
(G) the Endangered Species Act of 1973 (16 U.S.C.
1531 et seq.);
(H) the Marine Protection, Research, and
Sanctuaries Act of 1972 (33 U.S.C. 1401 et seq.);
(I) the Coral Reef Conservation Act of 2000 (16
U.S.C. 6401 et seq.); and
(J) the Estuary Restoration Act of 2000 (33 U.S.C.
2901 et seq.).
(5) Environmental protection agency.--Of the amounts made
available each fiscal year to carry out this section, 12.2
percent shall be allocated to the Administrator for use in
natural resources adaptation activities restoring and
protecting--
(A) large-scale freshwater aquatic ecosystems, such
as the Everglades, the Great Lakes, Flathead Lake, the
Missouri River, the Mississippi River, the Colorado
River, the Sacramento-San Joaquin Rivers, the Ohio
River, the Columbia-Snake River System, the
Apalachicola, Chattahoochee, and Flint River System,
the Connecticut River, and the Yellowstone River;
(B) large-scale estuarine ecosystems, such as
Chesapeake Bay, Long Island Sound, Puget Sound, the
Mississippi River Delta, the San Francisco Bay Delta,
Narragansett Bay, and Albemarle-Pamlico Sound; and
(C) freshwater and estuarine ecosystems,
watersheds, and basins identified as priorities by the
Administrator, working in cooperation with other
Federal agencies, States, Indian tribes, local
governments, scientists, and other conservation
partners.
(6) Corps of engineers.--Of the amounts made available each
fiscal year to carry out this section, 8.1 percent shall be
available to the Secretary of the Army for use by the Corps of
Engineers to carry out natural resources adaptation activities
restoring--
(A) large-scale freshwater aquatic ecosystems, such
as the ecosystems described in paragraph (5)(A);
(B) large-scale estuarine ecosystems, such as the
ecosystems described in paragraph (5)(B);
(C) freshwater and estuarine ecosystems,
watersheds, and basins identified as priorities by the
Corps of Engineers, working in cooperation with other
Federal agencies, States, Indian tribes, local
governments, scientists, and other conservation
partners; and
(D) habitats and ecosystems through the
implementation of estuary habitat restoration projects
authorized by the Estuary Restoration Act of 2000 (33
U.S.C. 2901 et seq.), project modifications for
improvement of the environment, aquatic restoration and
protection projects authorized by section 206 of the
Water Resources Development Act of 1996 (33 U.S.C.
2330), and other appropriate programs and activities.
(d) Use of Funds by Federal Departments and Agencies.--Funds
allocated to Federal departments and agencies under this section shall
only be used for natural resources adaptation activities that are
consistent with an adaptation plan developed and approved by the
President under section 478.
(e) State Cost Sharing.--Notwithstanding any other provision of
law, a State that receives a grant with amounts allocated under this
section shall use funds from non-Federal sources to pay at least 10
percent of the costs of each activity carried out using amounts
provided under the grant.
SEC. 481. NATIONAL WILDLIFE HABITAT AND CORRIDORS INFORMATION PROGRAM.
(a) Establishment.--Within 6 months of the date of enactment of
this subpart, the Secretary of the Interior, in cooperation with the
States and Indian tribes, shall establish a National Fish and Wildlife
Habitat and Corridors Information Program in accordance with the
requirements of this section.
(b) Purpose.--The purpose of this program is to--
(1) support States and Indian tribes in the development of
a geographic information system database of fish and wildlife
habitat and corridors that would inform planning and
development decisions within each State and Indian tribe,
enable each State and Indian tribe to model climate impacts and
adaptation, and provide geographically specific enhancements of
State and tribal wildlife action plans;
(2) ensure the collaborative development, with the States
and Indian tribes, of a comprehensive, national geographic
information system database of maps, models, data, surveys,
informational products, and other geospatial information
regarding fish and wildlife habitat and corridors, that--
(A) is based on consistent protocols for sampling
and mapping across landscapes that take into account
regional differences; and
(B) that utilizes--
(i) existing and planned State- and tribal-
based geographic information system databases;
and
(ii) existing databases, analytical tools,
metadata activities, and other information
products available through the National
Biological Information Infrastructure
maintained by the Secretary and nongovernmental
organizations; and
(3) facilitate the use of such databases by Federal, State,
local, and tribal decisionmakers to incorporate qualitative
information on fish and wildlife habitat and corridors at the
earliest possible stage to--
(A) prioritize and target natural resources
adaptation strategies and activities;
(B) avoid, minimize, and mitigate the impacts on
fish and wildlife habitat and corridors in siting
energy development, water, transmission,
transportation, and other land use projects;
(C) assess the impacts of existing development on
habitats and corridors; and
(D) develop management strategies to enhance the
ability of fish, wildlife, and plant species to migrate
or respond to shifting habitats within existing
habitats and corridors.
(c) Habitat and Corridors Information System.--
(1) In general.--The Secretary, in cooperation with the
States and Indian tribes, shall develop a Habitat and Corridors
Information System.
(2) Contents.--The System shall--
(A) include maps, data, and descriptions of fish
and wildlife habitat and corridors, that--
(i) have been developed by Federal
agencies, State wildlife agencies and natural
heritage programs, Indian tribes, local
governments, nongovernmental organizations, and
industry;
(ii) meet accepted Geospatial
Interoperability Framework data and metadata
protocols and standards;
(B) include maps and descriptions of projected
shifts in habitats and corridors of fish and wildlife
species in response to climate change;
(C) assure data quality and make the data, models,
and analyses included in the System available at scales
useful to decisionmakers--
(i) to prioritize and target natural
resources adaptation strategies and activities;
(ii) to assess the impacts of proposed
energy development, water, transmission,
transportation, and other land use projects and
avoid, minimize, and mitigate those impacts on
habitats and corridors;
(iii) to assess the impacts of existing
development on habitats and corridors; and
(iv) to develop management strategies to
enhance the ability of fish, wildlife, and
plant species to migrate or respond to shifting
habitats within existing habitats and
corridors;
(D) establish a process for updating maps and other
information as landscapes, habitats, corridors, and
wildlife populations change or as other information
becomes available;
(E) encourage the development of collaborative
plans by Federal and State agencies and Indian tribes
to monitor and evaluate the efficacy of the System to
meet the needs of decisionmakers;
(F) identify gaps in habitat and corridor
information, mapping, and research that should be
addressed to fully understand and assess current data
and metadata, and to prioritize research and future
data collection activities for use in updating the
System and provide support for those activities;
(G) include mechanisms to support collaborative
research, mapping, and planning of habitats and
corridors by Federal and State agencies, Indian tribes,
and other interested stakeholders;
(H) incorporate biological and geospatial data on
species and corridors found in energy development and
transmission plans, including renewable energy
initiatives, transportation, and other land use plans;
(I) be based on the best scientific information
available; and
(J) identify, prioritize, and describe key parcels
of non-Federal land located within the boundaries of
units of the National Park System, National Wildlife
Refuge System, National Forest System, or National
Grassland System that are critical to maintenance of
wildlife habitat and migration corridors.
(d) Financial and Other Support.--The Secretary may provide support
to the States and Indian tribes, including financial and technical
assistance, for activities that support the development and
implementation of the System.
(e) Coordination.--The Secretary, in cooperation with the States
and Indian tribes, shall make recommendations on how the information
developed in the System may be incorporated into existing relevant
State and Federal plans affecting fish and wildlife, including land
management plans, the State Comprehensive Wildlife Conservation
Strategies, and appropriate tribal conservation plans, to ensure that
they--
(1) prevent unnecessary habitat fragmentation and
disruption of corridors;
(2) promote the landscape connectivity necessary to allow
wildlife to move as necessary to meet biological needs, adjust
to shifts in habitat, and adapt to climate change; and
(3) minimize the impacts of energy, development, water,
transportation, and transmission projects and other activities
expected to impact habitat and corridors.
(f) Definitions.--In this section:
(1) Geospatial interoperability framework.--The term
``Geospatial Interoperability Framework'' means the strategy
utilized by the National Biological Information Infrastructure
that is based upon accepted standards, specifications, and
protocols adopted through the International Standards
Organization, the Open Geospatial Consortium, and the Federal
Geographic Data Committee, to manage, archive, integrate,
analyze, and make accessible geospatial and biological data and
metadata.
(2) Secretary.--The term ``Secretary'' means the Secretary
of the Interior.
SEC. 482. ADDITIONAL PROVISIONS REGARDING INDIAN TRIBES.
(a) Federal Trust Responsibility.--Nothing in this subpart is
intended to amend, alter, or give priority over the Federal trust
responsibility to Indian tribes.
(b) Exemption From FOIA.--Information received by a Federal agency
pursuant to this Act relating to the location, character, or ownership
of human remains of a person of Indian ancestry; or resources, cultural
items, uses, or activities identified by an Indian tribe as traditional
or cultural because of the long-established significance or ceremonial
nature to the Indian tribe; shall not be subject to disclosure under
section 552 of title 5, United States Code, if the head of the agency,
in consultation with the Secretary of the Interior and an affected
Indian tribe, determines that disclosure may--
(1) cause a significant invasion of privacy;
(2) risk harm to the human remains or resources, cultural
items, uses, or activities; or
(3) impede the use of a traditional religious site by
practitioners.
(c) Application of Other Law.--The Secretary of the Interior may
apply the provisions of Public Law 93-638 where appropriate in the
implementation of this subpart.
PART 2--INTERNATIONAL CLIMATE CHANGE ADAPTATION PROGRAM
SEC. 491. FINDINGS AND PURPOSES.
(a) Findings.--Congress finds the following:
(1) Global climate change is a potentially significant
national and global security threat multiplier and is likely to
exacerbate competition and conflict over agricultural,
vegetative, marine, and water resources and to result in
increased displacement of people, poverty, and hunger within
developing countries.
(2) The strategic, social, political, economic, cultural,
and environmental consequences of global climate change are
likely to have disproportionate adverse impacts on developing
countries, which have less economic capacity to respond to such
impacts.
(3) The countries most vulnerable to climate change, due
both to greater exposure to harmful impacts and to lower
capacity to adapt, are developing countries with very low
industrial greenhouse gas emissions that have contributed less
to climate change than more affluent countries.
(4) To a much greater degree than developed countries,
developing countries rely on the natural and environmental
systems likely to be affected by climate change for sustenance,
livelihoods, and economic growth and stability.
(5) Within developing countries there may be varying
climate change adaptation and resilience needs among different
communities and populations, including impoverished
communities, children, women, and indigenous peoples.
(6) The consequences of global climate change, including
increases in poverty and destabilization of economies and
societies, are likely to pose long-term challenges to the
national security, foreign policy, and economic interests of
the United States.
(7) It is in the national security, foreign policy, and
economic interests of the United States to recognize, plan for,
and mitigate the international strategic, social, political,
cultural, environmental, health, and economic effects of
climate change and to assist developing countries to increase
their resilience to those effects.
(8) Under Article 4 of the United Nations Framework
Convention on Climate Change, developed country parties,
including the United States, committed to ``assist the
developing country parties that are particularly vulnerable to
the adverse effects of climate change in meeting costs of
adaptation to those adverse effects''.
(9) Under the Bali Action Plan, developed country parties
to the United Nations Framework Convention on Climate Change,
including the United States, committed to ``enhanced action on
the provision of financial resources and investment to support
action on mitigation and adaptation and technology
cooperation,'' including, inter alia, consideration of
``improved access to adequate, predictable, and sustainable
financial resources and financial and technical support, and
the provision of new and additional resources, including
official and concessional funding for developing country
parties''.
(b) Purposes.--The purposes of this part are--
(1) to provide new and additional assistance from the
United States to the most vulnerable developing countries,
including the most vulnerable communities and populations
therein, in order to support the development and implementation
of climate change adaptation programs and activities that
reduce the vulnerability and increase the resilience of
communities to climate change impacts, including impacts on
water availability, agricultural productivity, flood risk,
coastal resources, timing of seasons, biodiversity, economic
livelihoods, health and diseases, and human migration; and
(2) to provide such assistance in a manner that protects
and promotes the national security, foreign policy,
environmental, and economic interests of the United States to
the extent such interests may be advanced by minimizing,
averting, or increasing resilience to climate change impacts.
SEC. 492. DEFINITIONS.
In this part:
(1) Allowance.--The term ``allowance'' means an emission
allowance established under section 721 of the Clean Air Act.
(2) Appropriate congressional committees.--The term
``appropriate congressional committees'' means--
(A) the Committees on Energy and Commerce,
Financial Services, and Foreign Affairs of the House of
Representatives; and
(B) the Committees on Environment and Public Works
and Foreign Relations of the Senate.
(3) Developing country.--The term ``developing country''
means a country eligible to receive official development
assistance according to the income guidelines of the
Development Assistance Committee of the Organization for
Economic Cooperation and Development.
(4) Most vulnerable developing countries.--The term ``most
vulnerable developing countries'' means, as determined by the
Administrator of USAID, developing countries that are at risk
of substantial adverse impacts of climate change and have
limited capacity to respond to such impacts, considering the
approaches included in any international treaties and
agreements.
(5) Most vulnerable communities and populations.--The term
``most vulnerable communities and populations'' means
communities and populations that are at risk of substantial
adverse impacts of climate change and have limited capacity to
respond to such impacts, including impoverished communities,
children, women, and indigenous peoples.
(6) Program.--The term ``Program'' means the International
Climate Change Adaptation Program established under section
493.
(7) USAID.--The term ``USAID'' means the United States
Agency for International Development.
(8) United nations framework convention on climate
change.--The term ``United Nations Framework Convention on
Climate Change'' or ``Convention'' means the United Nations
Framework Convention on Climate Change done at New York on May
9, 1992, and entered into force on March 21, 1994.
SEC. 493. INTERNATIONAL CLIMATE CHANGE ADAPTATION PROGRAM.
(a) Establishment.--The Secretary of State, in consultation with
the Administrator of USAID, the Secretary of the Treasury, and the
Administrator of the Environmental Protection Agency, shall establish
an International Climate Change Adaptation Program in accordance with
the requirements of this part.
(b) Allowance Account.--Allowances allocated pursuant to section
782(n) of the Clean Air Act shall be available for distribution to
carry out the Program established under subsection (a).
(c) Supplement Not Supplant.--Assistance provided under this part
shall be used to supplement, and not to supplant, any other Federal,
State, or local resources available to carry out activities of the type
carried out under the Program.
SEC. 494. DISTRIBUTION OF ALLOWANCES.
(a) In General.--The Secretary of State, or such other Federal
agency head as the President may designate, after consultation with the
Secretary of the Treasury, the Administrator of USAID, and the
Administrator of the Environmental Protection Agency, shall direct the
distribution of allowances to carry out the Program--
(1) in the form of bilateral assistance pursuant to the
requirements under section 495;
(2) to multilateral funds or international institutions
pursuant to the Convention or an agreement negotiated under the
Convention; or
(3) through a combination of the mechanisms identified
under paragraphs (1) and (2).
(b) Limitation.--
(1) Conditional distribution to multilateral funds or
international institutions.--In any fiscal year, the Secretary
of State, or such other Federal agency head as the President
may designate, in consultation with the Administrator of USAID,
the Secretary of the Treasury, and the Administrator of the
Environmental Protection Agency, shall distribute at least 40
percent and up to 60 percent of the allowances available to
carry out the Program to one or more multilateral funds or
international institutions that meet the requirements of
paragraph (2), if any such fund or institution exists, and
shall annually certify in a report to the appropriate
congressional committees that any multilateral fund or
international institution receiving allowances under this
section meets the requirements of paragraph (2) or that no
multilateral fund or international institution that meets the
requirements of paragraph (2) exists, as the case may be. The
Secretary of State shall notify the appropriate congressional
committees not less than 15 days prior to any transfer of
allowances to a multilateral fund or international institution
pursuant to this section.
(2) Multilateral fund or international institution
eligibility.--A multilateral fund or international institution
is eligible to receive allowances available to carry out the
Program--
(A) if--
(i) such fund or institution is established
pursuant to--
(I) the Convention; or
(II) an agreement negotiated under
the Convention; or
(ii) the allowances are directed to one or
more multilateral development banks or
international development institutions,
pursuant to an agreement negotiated under such
Convention; and
(B) if such fund or institution--
(i) specifies the terms and conditions
under which the United States is to provide
allowances to the fund or institution, and
under which the fund or institution is to
provide assistance to recipient countries;
(ii) ensures that assistance from the
United States to the fund or institution and
the principal and income of the fund or
institution are disbursed only for purposes
that are consistent with those described in
section 491(b)(1);
(iii) requires a regular meeting of a
governing body of the fund or institution that
includes representation from countries among
the most vulnerable developing countries and
provides public access;
(iv) requires that local communities and
indigenous peoples in areas where any
activities or programs are planned are engaged
through adequate disclosure of information,
public participation, and consultation; and
(v) prepares and makes public an annual
report that--
(I) describes the process and
methodology for selecting the
recipients of assistance from the fund
or institution, including assessments
of vulnerability;
(II) describes specific programs
and activities supported by the fund or
institution and the extent to which the
assistance is addressing the adaptation
needs of the most vulnerable developing
countries, and the most vulnerable
communities and populations therein;
(III) describes the performance
goals for assistance authorized under
the fund or institution and expresses
such goals in an objective and
quantifiable form, to the extent
practicable;
(IV) describes the performance
indicators to be used in measuring or
assessing the achievement of the
performance goals described in
subclause (III);
(V) provides a basis for
recommendations for adjustments to
assistance authorized under this part
to enhance the impact of such
assistance; and
(VI) describes the participation of
other nations and international
organizations in supporting and
governing the fund or institution.
(c) Oversight.--
(1) Distribution to multilateral funds or international
institutions.--The Secretary of State, or such other Federal
agency head as the President may designate, in consultation
with the Administrator of USAID, shall oversee the distribution
of allowances available to carry out the Program to a
multilateral fund or international institution under subsection
(b).
(2) Bilateral assistance.--The Administrator of USAID, in
consultation with the Secretary of State, shall oversee the
distribution of allowances available to carry out the Program
for bilateral assistance under section 495.
SEC. 495. BILATERAL ASSISTANCE.
(a) Activities and Foreign Aid.--
(1) In general.--In order to achieve the purposes of this
part, the Administrator of USAID may carry out programs and
activities and distribute allowances to any private or public
group (including international organizations and faith-based
organizations), association, or other entity engaged in
peaceful activities to--
(A) provide assistance to the most vulnerable
developing countries for--
(i) the development of national or regional
climate change adaptation plans, including a
systematic assessment of socioeconomic
vulnerabilities in order to identify the most
vulnerable communities and populations;
(ii) associated national policies; and
(iii) planning, financing, and execution of
adaptation programs and activities;
(B) support investments, capacity-building
activities, and other assistance, to reduce
vulnerability and promote community-level resilience
related to climate change and its impacts in the most
vulnerable developing countries, including impacts on
water availability, agricultural productivity, flood
risk, coastal resources, timing of seasons,
biodiversity, economic livelihoods, health, human
migration, or other social, economic, political,
cultural, or environmental matters;
(C) support climate change adaptation research in
or for the most vulnerable developing countries;
(D) reduce vulnerability and provide increased
resilience to climate change for local communities and
livelihoods in the most vulnerable developing countries
by encouraging--
(i) the protection and rehabilitation of
natural systems;
(ii) the enhancement and diversification of
agricultural, fishery, and other livelihoods;
and
(iii) the reduction of disaster risks;
(E) support the deployment of technologies to help
the most vulnerable developing countries respond to the
destabilizing impacts of climate change and encourage
the identification and adoption of appropriate
renewable and efficient energy technologies that are
beneficial in increasing community-level resilience to
the impacts of global climate change in those
countries; and
(F) encourage the engagement of local communities
through disclosure of information, consultation, and
the communities' informed participation relating to the
development of plans, programs, and activities to
increase community-level resilience to climate change
impacts.
(2) Limitations.--Not more than 10 percent of the
allowances made available to carry out bilateral assistance
under this part in any year shall be distributed to support
activities in any single country.
(3) Prioritizing assistance.--In providing assistance under
this section, the Administrator of USAID shall give priority to
countries, including the most vulnerable communities and
populations therein, that are most vulnerable to the adverse
impacts of climate change, determined by the likelihood and
severity of such impacts and the country's capacity to adapt to
such impacts.
(b) Community Engagement.--
(1) In general.--The Administrator of USAID shall ensure
that local communities, including the most vulnerable
communities and populations therein, in areas where any
programs or activities are carried out pursuant to this section
are engaged in, through disclosure of information, public
participation, and consultation, the design, implementation,
monitoring, and evaluation of such programs and activities.
(2) Consultation and disclosure.--For each country
receiving assistance under this section, the Administrator of
USAID shall establish a process for consultation with, and
disclosure of information to, local, national, and
international stakeholders regarding any programs and
activities carried out pursuant to this section.
(c) Coordination.--
(1) Alignment of activities.--Subject to the direction of
the President and the Secretary of State, the Administrator of
USAID shall, to the extent practicable, seek to align
activities under this section with broader development, poverty
alleviation, or natural resource management objectives and
initiatives in the recipient country.
(2) Coordination of activities.--The Administrator of USAID
shall ensure that there is coordination among the activities
under this section, subtitle D of this title, and part E of
title VII of the Clean Air Act, in order to maximize the
effectiveness of United States assistance to developing
countries.
(d) Reporting.--
(1) Initial report.--Not later than 180 days after the date
of enactment of this part, the Administrator of USAID, in
consultation with the Secretary of State, shall submit to the
President and the appropriate congressional committees an
initial report that--
(A) based on the most recent information available
from reliable public sources or knowledge obtained by
USAID on a reliable basis, as determined by the
Administrator of USAID, identifies the developing
countries, including the most vulnerable communities
and populations therein, that are most vulnerable to
climate change impacts and in which assistance may have
the greatest and most sustainable benefit in reducing
vulnerability to climate change; and
(B) describes the process and methodology for
selecting the recipients of assistance under subsection
(a)(1).
(2) Annual reports.--Not later than 18 months after the
date on which the initial report is submitted pursuant to
paragraph (1), and annually thereafter, the Administrator of
USAID, in consultation with the Secretary of State, shall
submit to the President and the appropriate congressional
committees a report that--
(A) describes the extent to which global climate
change, through its potential negative impacts on
sensitive populations and natural resources in the most
vulnerable developing countries, may threaten, cause,
or exacerbate political, economic, environmental,
cultural, or social instability or international
conflict in those regions;
(B) describes the ramifications of any potentially
destabilizing impacts climate change may have on the
national security, foreign policy, and economic
interests of the United States, including--
(i) the creation of environmental migrants
and internally displaced peoples;
(ii) international or internal armed
conflicts over water, food, land, or other
resources;
(iii) loss of agricultural and other
livelihoods, cultural stability, and other
causes of increased poverty and economic
destabilization;
(iv) decline in availability of resources
needed for survival, including water;
(v) increased impact of natural disasters
(including droughts, flooding, and other severe
weather events);
(vi) increased prevalence or virulence of
climate-related diseases; and
(vii) intensified urban migration;
(C) describes how allowances available under this
section were distributed during the previous fiscal
year to enhance the national security, foreign policy,
and economic interests of the United States and assist
in avoiding the economically, politically,
environmentally, culturally, and socially destabilizing
impacts of climate change in most vulnerable developing
countries;
(D) identifies and recommends the developing
countries, including the most vulnerable communities
and populations therein, that are most vulnerable to
climate change impacts and in which assistance may have
the greatest and most sustainable benefit in reducing
vulnerability to climate change, including in the form
of deploying technologies, investments, capacity-
building activities, and other types of assistance for
adaptation to climate change impacts and approaches to
reduce greenhouse gases in ways that may also provide
community-level resilience to climate change impacts;
and
(E) describes cooperation undertaken with other
nations and international organizations to carry out
this part.
(e) Monitoring and Evaluation.--
(1) In general.--The Administrator of USAID shall establish
and implement a system to monitor and evaluate the
effectiveness and efficiency of assistance provided under this
section in order to maximize the long-term sustainable
development impact of such assistance, including the extent to
which such assistance is meeting the purposes of this part and
addressing the adaptation needs of developing countries.
(2) Requirements.--In carrying out paragraph (1), the
Administrator of USAID shall--
(A) in consultation with national governments in
recipient countries, establish performance goals for
assistance authorized under this section and express
such goals in an objective and quantifiable form, to
the extent practicable;
(B) establish performance indicators to be used in
measuring or assessing the achievement of the
performance goals described in subparagraph (A),
including an evaluation of--
(i) the extent to which assistance under
this section provided for disclosure of
information to, consultation with, and informed
participation by local communities;
(ii) the extent to which local communities
participated in the design, implementation, and
evaluation of programs and activities
implemented pursuant to this section; and
(iii) the impacts of such participation on
the goals and objectives of the programs and
activities implemented under this section;
(C) provide a basis for recommendations for
adjustments to assistance authorized under this section
to enhance the impact of such assistance; and
(D) include, in the annual report to the
appropriate congressional committees and other relevant
agencies required under subsection (d)(2), findings
resulting from the monitoring and evaluation of
programs and activities under this section.
Subtitle F--Deficit Neutral Budgetary Treatment
SEC. 496. DEFICIT NEUTRALITY.
(a) Funds Established.--Funds established under sections 422, 467,
and 480 of this Act are to be treated as separate accounts in the
Treasury and shall be known as ``the Funds''.
(b) Availability.--Funds appropriated or made available pursuant to
sections 422(b), 467(b), and 480(b)(2) are only available for the
purposes set forth under this Act. Receipts in the Funds and
appropriations therefrom shall not be available and are precluded from
obligation for any other purpose.
(c) Estimation of Budgetary Impact.--For the purposes of estimating
the revenue and spending effects of this Act;
(1) the revenue assumed to be deposited into the Funds
established under sections 422, 467, and 480, shall be
attributed to this Act; and
(2) the authorization or availability of appropriations
from the Funds shall be treated as new direct spending and
attributed to this Act.
(d) Budgetary Treatment.--For the purposes of section 257 of the
Balanced Budget and Emergency Deficit Control Act of 1985, the Funds,
and amounts subsequently appropriated or made available for the
purposes for which such Funds were established, shall be deemed to be
included on the list of appropriations referenced under section
250(c)(17) of that Act. Such appropriations from each Fund shall not be
in excess of the amounts deposited into the respective Fund in the
previous year.
TITLE V--AGRICULTURAL AND FORESTRY RELATED OFFSETS
Subtitle A--Offset Credit Program From Domestic Agricultural and
Forestry Sources
SEC. 501. DEFINITIONS.
(a) In General.--In this title:
(1) Additional.--The term ``additional'', when used with
respect to reductions or avoidance of greenhouse gas emissions,
or to sequestration of greenhouse gases, means reductions,
avoidance, or sequestration that result in a lower level of net
greenhouse gas emissions or atmospheric concentrations than
would occur in the absence of an offset project.
(2) Additionality.--The term ``additionality'' means the
extent to which reductions or avoidance of greenhouse gas
emissions, or sequestration of greenhouse gases, are
additional.
(3) Administrator.--The term ``Administrator'' means the
Administrator of the Environmental Protection Agency.
(4) Advisory committee.--The term ``Advisory Committee''
means the USDA Greenhouse Gas Emission Reduction and
Sequestration Advisory Committee established under section
1245(f) of the Food Security Act of 1985 (16 U.S.C. 3845).
(5) Greenhouse gas.--The term ``greenhouse gas'' means any
of the following:
(A) Carbon dioxide.
(B) Methane.
(C) Nitrous oxide.
(D) Sulfur hexafluoride.
(E) Hydrofluorocarbons from a chemical
manufacturing process at an industrial stationary
source.
(F) Any perfluorocarbon.
(G) Nitrogen trifluoride.
(H) Any other anthropogenic gas designated as a
greenhouse gas by the Administrator.
(6) Leakage.--The term ``leakage'' means a significant and
quantifiable increase in greenhouse gas emissions, or a
significant and quantifiable decrease in sequestration, which
is caused by an offset practice and occurs outside the
boundaries of the offset practice.
(7) Offset credit.--The term ``offset credit'' means a
tradeable compliance instrument that--
(A) represents the reduction, avoidance, or
sequestration of 1 ton of carbon dioxide equivalent;
and
(B) is issued pursuant to this title.
(8) Offset practice.--The term ``offset practice'' means an
activity that reduces, avoids, or sequesters greenhouse gas
emissions, and for which offset credits may be issued pursuant
to this title.
(9) Offset producer.--The term ``offset producer'' means an
owner, operator, landlord, tenant, or sharecropper who has or
shares responsibility for ensuring that an offset practice is
established and maintained during the crediting period for
purposes of an offset credit.
(10) Offset project.--The term ``offset project'' means a
practice or set of practices that reduce or avoid greenhouse
gas emissions, or sequester greenhouse gases as implemented by
an offset producer.
(11) Offset project developer.--The term ``offset project
developer'' means the offset producer or designee of the offset
producer.
(12) Practice type.--The term ``practice type'' means a
discrete category of offset practices for which the Secretary
develops a standardized methodology to accurately estimate the
amount of greenhouse gas emissions reduced or avoided or
greenhouse gases sequestered.
(13) Reversal.--The term ``reversal'' means an intentional
or unintentional loss of sequestered greenhouse gases to the
atmosphere.
(14) Secretary.--The term ``Secretary'' means the Secretary
of Agriculture.
(15) Sequestration and sequestered.--The terms
``sequestered'' and ``sequestration'' mean the separation,
isolation, or removal of greenhouse gases from the atmosphere,
as determined by the Secretary. The terms include biological
sequestration, but do not include ocean fertilization
techniques.
(16) Term offset credit.--The term ``term offset credit''
means a compliance instrument authorized under section 504(d).
(b) Agricultural and Forestry Exception to Definition of Capped
Sector.--For purposes of this title and title III of this Act, and
amendments made by such titles, the term ``capped sector'' means a
sector of economic activity that directly emits capped emissions,
including the industrial sector, the electricity generation sector, the
transportation sector, and the residential and commercial sectors (to
the extent they burn oil or natural gas), but not including the
agricultural or forestry sectors.
SEC. 502. ESTABLISHMENT OF OFFSET CREDIT PROGRAM FROM DOMESTIC
AGRICULTURAL AND FORESTRY SOURCES.
(a) Establishment.--Not later than 1 year after the date of
enactment of this title, the Secretary shall establish a program
governing the generation of offset credits from domestic agricultural
and forestry sources.
(b) Requirements.--The program described in subsection (a) shall--
(1) ensure that offset credits represent verifiable and
additional greenhouse gas emission reductions or avoidance, or
increases in sequestration; and
(2) ensure that offset credits issued for sequestration
offset projects are only issued for greenhouse gas reductions
that result in a permanent net reduction in atmospheric
greenhouse gases.
(c) Duties of Secretary.--In addition to the duties described in
subsection (a) and section 1245 of the Food Security Act of 1985 (16
U.S.C. 3845), the Secretary shall, with respect to practices relating
to offset credits from agricultural and forestry sources--
(1) establish by rule methodologies by practice types for
quantifying greenhouse gas benefits;
(2) establish by rule methodologies for each practice type
for establishing activity baselines and determining
additionality;
(3) establish by rule methodologies by practice types for
accounting for and mitigating potential leakage;
(4) establish rules to account for and address reversals;
(5) establish rules to require third-party verification;
(6) provide technical assistance to offset project
developers using funds appropriated to the Conservation
Operations account;
(7) establish rules for approval of offset project plans;
(8) establish rules for certification of implementation of
offset project plans;
(9) establish by rule requirements for reporting and record
keeping; and
(10) conduct audits.
SEC. 503. LIST OF ELIGIBLE DOMESTIC AGRICULTURAL AND FORESTRY OFFSET
PRACTICE TYPES.
(a) List Required.--
(1) Preparation and publication.--Not later than 1 year
after the date of enactment of this title, the Secretary shall
prepare and publish in the Federal Register a list of domestic
agricultural and forestry practice types that are eligible to
generate offset credits under this title because the practices
avoid or reduce greenhouse gas emissions or sequester
greenhouse gases.
(2) Recommendations.--In preparing the list under paragraph
(1), the Secretary shall take into consideration the
recommendations of the Advisory Committee.
(b) Initial List.--At a minimum, the list prepared under this
section shall include those practices that avoid or reduce greenhouse
gas emissions or sequester greenhouse gases, such as--
(1) agricultural, grassland, and rangeland sequestration
and management practices, including--
(A) altered tillage practices;
(B) winter cover cropping, continuous cropping, and
other means to increase biomass returned to soil in
lieu of planting followed by fallowing;
(C) reduction of nitrogen fertilizer use or
increase in nitrogen use efficiency;
(D) reduction in the frequency and duration of
flooding of rice paddies;
(E) reduction in carbon emissions from organic
soils;
(F) reduction in greenhouse gas emissions from
manure and effluent; and
(G) reduction in greenhouse gas emissions due to
changes in animal management practices, including
dietary modifications;
(2) changes in carbon stocks attributed to land use change
and forestry activities, including--
(A) afforestation or reforestation of acreage that
is not forested;
(B) forest management resulting in an increase in
forest carbon stores including but not limited to
harvested wood products;
(C) management of peatland or wetland;
(D) conservation of grassland and forested land;
(E) improved forest management, including
accounting for carbon stored in wood products;
(F) reduced deforestation or avoided forest
conversion;
(G) urban tree-planting and maintenance;
(H) agroforestry; and
(I) adaptation of plant traits or new technologies
that increase sequestration by forests; and
(3) manure management and disposal, including--
(A) waste aeration;
(B) biogas capture and combustion; and
(C) application to fields as a substitute for
commercial fertilizer.
(c) Additions and Revisions to List.--
(1) Periodic revision.--Not later than 2 years after the
date of enactment of this title, and every 2 years thereafter,
the Secretary, after public notice and opportunity for comment,
shall add to and revise the types of offset practices to the
list established under subsection (a) if those types of
practices meet the standards for environmental integrity that
are consistent with the purposes of this title.
(2) Consideration of petitions.--The Secretary shall--
(A) consider petitions to add types of offset
practices to the list established under subsection (a);
and
(B) add those types of offset practices to the list
if the types of offset practices meet standards for
environmental integrity consistent with the purposes of
this title.
(3) Time for consideration of petitions.--Not later than 1
year after the receipt of a petition under paragraph (2), the
Secretary shall make a decision to either grant or deny the
petition and publish a written explanation of the reasons for
the Secretary's decision. The Secretary may not deny a petition
under this subsection on the basis of inadequate Department of
Agriculture resources at the time of the review.
SEC. 504. REQUIREMENTS FOR DOMESTIC AGRICULTURAL AND FORESTRY
PRACTICES.
(a) Methodologies.--
(1) In general; condition.--In promulgating regulations
under section 502, the Secretary shall establish methodologies
for domestic agricultural and forestry practices listed under
section 503, if the Secretary determines that methodologies can
be established for such practices that meet each of the
requirements of this section. The Secretary shall only issue
offset credits under this title pursuant to promulgated
methodologies applicable to the offset practice that avoided or
reduced greenhouse gas emissions or sequestered greenhouse
gases.
(2) Specified methodologies.--The Secretary shall establish
the following methodologies under this section:
(A) Activity baselines.--A standardized methodology
for establishing activity baselines for an offset
practice of that type. The Secretary shall set activity
baselines to reflect a conservative estimate of
performance or activities for the relevant type of
practice (excluding changes in performance or
activities due to the availability of offset credits)
such that the baseline provides an adequate margin of
safety to ensure the environmental integrity of offset
credits calculated in reference to such baseline.
(B) Additionality.--A standardized methodology for
determining the additionality of greenhouse gas
emissions reduction or avoidance, or greenhouse gas
sequestration, achieved by an offset practice of that
type. Such methodology shall ensure, at a minimum, that
any greenhouse gas emission reduction or avoidance, or
any greenhouse gas sequestration, is considered
additional only to the extent that it results from
activities that--
(i) are not required by existing government
regulations, as determined by the Secretary;
(ii) were not commenced prior to January 1,
2009, except in the case of--
(I) offset project activities that
commenced after January 1, 2001, and
were registered as of the date of
enactment of this title under an offset
program with respect to which an
affirmative determination has been made
under section 740 of the Clean Air Act;
or
(II) activities that are readily
reversible, with respect to which the
Secretary may set an alternative
earlier date under this subparagraph
that is not earlier than January 1,
2001, where the Secretary determines
that setting such an alternative date
may produce an environmental benefit by
removing an incentive to cease and then
reinitiate activities that began prior
to January 1, 2009; and
(iii) exceed the applicable activity
baseline established under paragraph (2).
(C) Quantification methods.--A standardized
methodology for determining the extent to which
greenhouse gas emission reductions or avoidance, or
greenhouse gas sequestration, achieved by an offset
practice of that type exceeded a relevant activity
baseline, including methods for monitoring and
accounting for uncertainty.
(D) Leakage.--A standardized methodology for
accounting for and mitigating potential leakage, if
any, from an offset practice of that type, taking
uncertainty into account, excluding international
indirect land use changes unless a positive
determination is made under section 211(o)(13)(C)(iii)
of the Clean Air Act.
(b) Special Considerations.--
(1) Existing offset practices.--In establishing the
methodologies under subsection (a), the Secretary shall give
due consideration to methodologies for offset practices
existing as of the date of the enactment of this title.
(2) Certain factors.--As part of the methodologies
established under subsection (a), the Secretary shall establish
a formula that takes into account the components of the
practice, the characteristics of the land on which the practice
is applied, the crop produced, and such other factors as
determined appropriate by the Secretary.
(c) Accounting for Reversals.--
(1) In general.--Except as provided in subsection (d) with
respect to issuance of a term offset credit, for each type of
practice listed under section 503, the Secretary shall
establish requirements to account for and address reversals,
including--
(A) a requirement to report any reversal with
respect to an offset practice for which offset credits
have been issued under this title;
(B) provisions to require emission allowances or
offset credits to be held in amounts to fully
compensate for greenhouse gas emissions attributable to
reversals, and to assign responsibility for holding
such emission allowances; and
(C) any other provisions that the Secretary
determines to be necessary to account for and address
reversals.
(2) Mechanisms.--
(A) In general.--The Secretary shall prescribe
mechanisms to ensure that any sequestration of
greenhouse gases, with respect to which an offset
credit is issued under this title, results in a
permanent net increase in sequestration of greenhouse
gases, and that full account is taken of any actual or
potential reversal of such sequestration, with an
adequate margin of safety.
(B) Specific mechanisms.--The Secretary shall make
available one or more of the following mechanisms to
meet the requirements of this paragraph:
(i) An offsets reserve, pursuant to
paragraph (3).
(ii) Insurance that provides for purchase
and provision to the Secretary for retirement
of a quantity of offset credits or emission
allowances equal in number to the tons of
carbon dioxide equivalents of greenhouse gas
emissions released due to reversal.
(iii) Another mechanism if the Secretary
determines it is necessary to satisfy the
requirements of this title, taking into account
whether the reversal was intentional or
unintentional.
(3) Offsets reserve.--
(A) In general.--An offsets reserve referred to in
paragraph (2)(B)(i) is a program under which, before
issuance of offset credits under this title, the
Secretary shall--
(i) subtract and reserve from the quantity
to be issued a quantity of offset credits based
on the risk of reversal;
(ii) hold those reserved offset credits in
the offsets reserve; and
(iii) register the holding of the reserved
offset credits in an offset registry.
(B) Practice reversal.--
(i) In general.--If a reversal has occurred
with respect to an offset practice within an
offset project, for which offset credits are
reserved under this paragraph, the Secretary
shall retire offset credits from the offsets
reserve to fully account for the tons of carbon
dioxide equivalent that are no longer
sequestered.
(ii) Intentional reversals.--If the
Secretary determines that a reversal was
intentional, the offset practice developer for
the relevant offset practice shall place into
the offsets reserve a quantity of offset
credits, or combination of offset credits and
emission allowances, equal in number to the
number of reserve offset credits that were
retired pursuant to clause (i).
(iii) Unintentional reversals.--If the
Secretary determines that a reversal was
unintentional, the offset project developer for
the relevant offset project shall place into
the offsets reserve a quantity of offset
credits, or combination of offset credits and
emission allowances, equal in number to half
the number of offset credits that were reserved
for that offset project, or half the number of
reserve offset credits that were canceled due
to the reversal pursuant to clause (i),
whichever is less, except that the Secretary
may lower this amount based on undue hardship
in the event of a catastrophic occurrence.
(C) Use of reserved offset credits.--Offset credits
placed into the offsets reserve under this paragraph
may not be used to comply with section 722 of the Clean
Air Act.
(d) Term Offset Credits.--
(1) Applicability.--With respect to a practice listed under
section 503 that sequesters greenhouse gases and has a
crediting period of no more than 5 years, the Secretary may
address reversals pursuant to this subsection in lieu of
permanently accounting for reversals pursuant to subsection
(c).
(2) Accounting for reversals.--For such practices or
projects implementing such practices, the Secretary shall
require only reversals that occur during the crediting period
to be accounted for and addressed pursuant to subsection (c).
(3) Credits issued.--For practices or projects regulated
pursuant to paragraph (2), the Secretary shall issue under
section 507 a term offset credit, in lieu of an offset credit,
for each ton of carbon dioxide equivalent that has been
sequestered.
(e) Crediting Periods.--
(1) In general.--For each offset practice type within an
offset project, the Secretary shall specify a crediting period,
and establish provisions for reenrollment for a subsequent
crediting period, in accordance with this subsection.
(2) Duration.--The crediting period shall have a term of up
to--
(A) 5 years for agricultural sequestration
practices;
(B) 20 years for forestry sequestration practices;
and
(C) 10 years for other practice types that reduce
or avoid greenhouse gas emissions or sequester
greenhouse gases.
(3) Eligibility.--An offset practice, within an offset
project, shall--
(A) be eligible to generate offset credits under
this title only during the crediting period of the
offset practice; and
(B) remain eligible to generate offset credits,
only during the crediting period, subject to the
methodologies and practice type eligibility list that
applied as of the date of the project approval.
(4) Reenrollment for subsequent crediting period.--
(A) Reenrollment authorized; time for
reenrollment.--An offset project developer may reenroll
for a subsequent crediting period, to commence after
termination of the current crediting period, subject to
the methodologies and practice type eligibility list in
effect at the time of reenrollment. Reenrollment may
not occur more than 18 months before the end of the
crediting period then in effect.
(B) Limitation.--The Secretary may limit the number
of subsequent crediting periods available for a
particular practice type.
(f) Environmental Integrity.--In establishing the requirements
under this section, the Secretary shall apply conservative assumptions
or methods to ensure the environmental integrity of the cap established
under section 703 of the Clean Air Act is not compromised.
SEC. 505. PROJECT PLAN SUBMISSION AND APPROVAL.
(a) Project Plan Required.--An offset project developer shall
submit to the Secretary an offset project plan for approval.
(b) Requirements.--As part of the regulations promulgated under
this title, the Secretary shall include provisions for, and shall
specify, the required components of an offset project plan, including--
(1) designation of an offset project developer;
(2) a list and schedule of the practices to be implemented;
(3) any other information that the Secretary considers to
be necessary--
(A) to determine whether the offset practice,
within the offset project, is eligible for issuance of
offset credits under regulations promulgated under this
title; and
(B) to achieve the purposes of this title.
(c) Time for Consideration; Notification.--Not later than 90 days
after receiving a complete offset project plan under subsection (a),
the Secretary shall--
(1) approve the plan in writing and include an estimate of
the offset project credits that will be earned if the plan is
implemented, subject to verification of all project-specific
variables; or
(2) if the plan is denied, provide the reasons for denial
in writing.
(d) Appeal.--The Secretary shall establish procedures for appeal
and review of determinations made under this section.
(e) Resubmission.--After an offset project plan is approved, the
offset project developer shall not be required to resubmit a project
plan during the crediting period.
SEC. 506. VERIFICATION OF OFFSET PRACTICES.
(a) In General.--As part of the regulations promulgated under this
title, the Secretary shall establish requirements to verify--
(1) that offset practices in an approved offset project
plan have been implemented; and
(2) the quantity of greenhouse gas emission reductions or
avoidance, or sequestration of greenhouse gases, resulting from
an offset practice and project.
(b) Verification Reports.--
(1) In general.--The regulations described in subsection
(a) shall require an offset project developer to submit a
report, prepared by a third-party verifier accredited under
subsection (c).
(2) Requirements.--The Secretary shall specify the
components of a verification report required under paragraph
(1), including--
(A) the name and contact information for the offset
project developer;
(B) a certification that the project plan has been
implemented;
(C) the quantity of greenhouse gases reduced,
avoided, or sequestered;
(D) a certification establishing that the conflict
of interest requirements in the regulations promulgated
under this title have been complied with;
(E) any other information that the Secretary
requires to determine the quantity of greenhouse gas
emission reduction or avoidance, or sequestration of
greenhouse gases, resulting from the offset practice
and project; and
(F) any other information that the Secretary
considers to be necessary to achieve the purposes of
this title.
(c) Verifier Accreditation.--
(1) In general.--As part of the regulations promulgated
under this title, the Secretary shall establish a process and
requirements for periodic accreditation of third-party
verifiers for offset credits under this program to ensure that
those verifiers are professionally qualified and have no
conflicts of interest.
(2) Public accessibility.--Each verifier meeting the
requirements for accreditation in accordance with this
subsection shall be listed in a publicly accessible database,
which shall be maintained and updated by the Secretary.
SEC. 507. CERTIFICATION OF OFFSET CREDITS.
(a) Determination and Notification.--Not later than 90 days after
receiving a complete verification report, the Secretary shall--
(1) make a determination of the quantity of greenhouse gas
emissions that have been reduced or avoided, or greenhouse
gases that have been sequestered, by the offset practice in an
approved and verified offset project plan; and
(2) notify the offset project developer in writing of the
determination.
(b) Issuance of Offset Credits.--The Secretary shall issue 1 offset
credit to an offset project developer for each ton of carbon dioxide
equivalent that the Secretary determines has been reduced, avoided, or
sequestered during the crediting period. Offset credits may be issued
only for greenhouse gas emissions reduced, avoided, or sequestered
after January 1, 2009.
(c) Appeal.--The Secretary shall establish procedures for appeal
and review of determinations made under subsection (a).
(d) Timing.--Offset credits meeting the criteria described in
subsection (b) shall be issued by the Secretary not later than 14 days
after the date on which the Secretary makes a determination under
subsection (a).
(e) Registration.--The Secretary shall obtain from the
Administrator a unique serial number to allow for the registration of
each offset credit to be issued under this title.
SEC. 508. OWNERSHIP AND TRANSFER OF OFFSET CREDITS.
(a) Ownership.--Initial ownership of an offset credit shall lie
with the offset project developer, unless otherwise specified in a
legally binding contract or agreement.
(b) Transferability.--An offset credit issued under this title may
be sold, traded, or transferred, unless the offset credit has expired
or been retired.
SEC. 509. PROGRAM REVIEW AND REVISION.
At least once every 5 years, the Secretary shall review and, based
on new or updated information and taking into consideration the
recommendations of the Advisory Board, update and revise--
(1) the list of eligible practice types established under
section 503;
(2) the methodologies established, including specific
activity baselines, under section 504(a);
(3) the reversal requirements and mechanisms established or
prescribed under subsections (c) and (d) of section 504;
(4) measures to improve the accountability of the offsets
program; and
(5) any other requirements established under this title to
ensure the environmental integrity and effective operation of
this title.
SEC. 510. ENVIRONMENTAL CONSIDERATIONS.
If the Secretary lists forestry practices as eligible offset
practice types under section 503, the Secretary, in consultation with
appropriate Federal agencies, shall promulgate regulations for the
selection and use of species in forestry and other relevant land
management-related offset practices--
(1) to ensure that native species are given primary
consideration in such practices;
(2) to encourage the conservation of biological diversity
in such practices;
(3) to prohibit the use of federally designated or State-
designated noxious weeds;
(4) to prohibit the use of a species listed by a regional
or State invasive plant authority within the applicable region
or State; and
(5) in accordance with widely accepted, environmentally
sustainable forestry practices.
SEC. 511. AUDITS.
(a) Audits Required.--The Secretary shall conduct, on an annual
basis, random audits of offset projects, offset credits, and the
practices of third-party verifiers. At a minimum, the Secretary shall
conduct audits each year for a representative sample of practice types
and geographical areas.
(b) Additional Authority.--Nothing in this section prevents the
Secretary from conducting any audit the Secretary considers to be
necessary.
Subtitle B--USDA Greenhouse Gas Emission Reduction and Sequestration
Advisory Committee
SEC. 531. ESTABLISHMENT OF USDA GREENHOUSE GAS EMISSION REDUCTION AND
SEQUESTRATION ADVISORY COMMITTEE.
Section 1245 of the Food Security Act of 1985 (16 U.S.C. 3854), as
added by section 2709 of the Food, Conservation, and Energy Act of 2008
(Public Law 110-246; 122 Stat. 1809), is amended by adding at the end
the following new subsection:
``(f) USDA Greenhouse Gas Emission Reduction and Sequestration
Advisory Committee.--
``(1) Establishment.--Not later than 30 days after the date
of the enactment of the American Clean Energy and Security Act
of 2009, the Secretary shall establish an independent advisory
committee, to be known as the `USDA Greenhouse Gas Emission
Reduction and Sequestration Advisory Committee', to provide
scientific and technical advice on establishing, implementing,
and ensuring the overall environmental integrity of an offset
program for domestic agricultural and forestry practices that
reduce or avoid greenhouse gas emissions, or sequester
greenhouse gases.
``(2) Membership.--The Advisory Committee shall be
comprised of nine members, including a chairperson and vice-
chairperson, appointed by the Secretary. Each member shall be
qualified by education, training, and experience to evaluate
scientific and technical information for domestic agricultural
and forestry offset practices that reduce or avoid greenhouse
gas emissions or sequester greenhouse gases.
``(3) Terms.--Terms shall be 3 years in length, except for
the initial terms, which may be up to 5 years in length to
allow staggered terms. Members may be reappointed only once for
an additional 3-year term, and such term may follow directly
after a first term.
``(4) Duties.--The Advisory Committee shall--
``(A) provide options and recommendations, not
later than 180 days after the date of the enactment of
the American Clean Energy and Security Act of 2009, to
the Secretary regarding the establishment of
methodologies as described in section 504 of such Act,
taking into account relevant scientific information,
including--
``(i) the availability of representative
data for use in developing an activity baseline
for a land area, forest, soil, industry sector,
and facility type;
``(ii) the potential for accurate
quanitification of greenhouse gas reduction, or
sequestration for an offset practice type;
``(iii) the potential level of scientific
and measurement uncertainty associated with an
offset practice type; and
``(iv) the use of practice methodologies
that account for common practice or other
direct comparisons within a relevant land area,
industry sector, forest, soil, or facility
type;
``(B) make available to the Secretary options and
recommendations for the program as a whole and on
offset methodologies for each practice type that should
be considered under regulations promulgated pursuant to
section 504 of the American Clean Energy and Security
Act of 2009, including methodologies to address the
issues of additionality, activity baselines,
measurement, leakage, including the application of
sector specific leakage factors, uncertainty,
permanence, and environmental integrity;
``(C) make available to the Secretary advice and
comment on areas where further knowledge is required to
appraise the adequacy of existing, revised, or proposed
methodologies and describe the research efforts
necessary to provide the required information;
``(D) make available to the Secretary advice and
comments on other ways to improve or safeguard the
environmental integrity of the offset practice types
listed under section 503 of the American Clean Energy
and Security Act of 2009; and
``(E) provide options and recommendations regarding
new practice types.
``(5) Scientific review of offset program.--Not later than
January 1, 2017, and at 5-year intervals thereafter, the
Advisory Committee shall--
``(A) submit to the Secretary and make available to
the public an analysis of relevant scientific and
technical information regarding agricultural and
forestry offset practices that reduce or avoid
greenhouse gas emissions or sequester greenhouse gases;
``(B) review approved and potential practice types,
methodologies, scientific studies, offset project
monitoring, offset project verification reports,
reporting of reversals, audits related to the offset
program, and other relevant information needed to
evaluate the offset program;
``(C) evaluate the net emission effects of
implemented offset projects; and
``(D) recommend changes to offset methodologies,
procedures, practice types, or the overall program to
ensure that--
``(i) the offset practices result in
reduced or avoided greenhouse gas emissions or
sequestration of greenhouse gases;
``(ii) the offset credits issued by the
Secretary do not compromise the integrity of
the annual emissions reductions established
under section 703 of the Clean Air Act; and
``(iii) the offset program avoids or
minimizes adverse affects to human health and
the environment.
``(6) Coordination.--To avoid duplication, the Advisory
Committee shall coordinate its activities with those of any
other Federal advisory committees working in related areas, and
shall to the maximum extent possible use research data and
services of the research, education, extension agencies of the
Department of Agriculture.
``(7) Consultation.--On a periodic basis, the Advisory
Committee shall consult with, and be informed by the views of,
the Offsets Integrity Advisory Board established under section
731 of the Clean Air Act.
``(8) Meeting.--The Advisory Committee shall meet on at
least a quarterly basis each year.
``(9) Administrative support and funding.--The Secretary
may provide such administrative and funding support as
necessary to enable the Advisory Committee to carry out its
duties under this section.
``(10) Report.--For each fiscal year, the Secretary shall
submit to Congress a report on--
``(A) the status and progress on the offset
practices;
``(B) the general status of cooperation and
research and development; and
``(C) the plans for addressing future issues and
concerns.''.
Subtitle C--Miscellaneous
SEC. 551. INTERNATIONAL INDIRECT LAND USE CHANGES.
Section 211(o) of the Clean Air Act (42 U.S.C. 7545(o)) is amended
by adding at the end the following
``(13) International indirect land use changes.--
``(A) Exclusion from regulatory requirements
regarding lifecycle greenhouse gas emissions.--
Notwithstanding the definition of `lifecycle greenhouse
gas emissions' in paragraph (1)(H), for purposes of
determining whether the fuel meets a definition in
paragraph (1) or complies with paragraph (2)(A)(i), the
Administrator shall exclude emissions from indirect
land use changes outside the renewable fuel's
feedstock's country of origin.
``(B) National academies of science report.--(i)
Not later than 6 months after the date of enactment of
this paragraph, the Administrator and the Secretary of
Agriculture shall jointly arrange for the National
Academies of Science to review and report on specified
issues related to indirect greenhouse gas emissions
related to transportation fuels.
``(ii) The report shall evaluate and report on
whether there are economic and environmental models and
methodologies that individually, or as a system, can
project with reliability, predictability, and
confidence--
``(I) for purposes of determining whether
the fuel meets a definition in paragraph (1) or
complies with paragraph (2)(A)(i), indirect
land use changes that are related to the
production of renewable fuels and that may
occur outside the country in which the
feedstocks are grown, and the impacts of these
changes on greenhouse gas emissions; and
``(II) indirect effects, both domestic and
international, related to the production and
importation of non-renewable transportation
fuels that have significant greenhouse gas
emissions, and the impact of these effects on
greenhouse gas emissions.
``(iii) The report shall include a review and
assessment of all pertinent scientific studies,
methodologies and data, shall evaluate potential
methodologies for calculating such emissions (including
an evaluation of methods for annualizing emissions
associated with forest degradation or land conversion),
and shall make appropriate recommendations. The
recommendations shall address indirect effects, both
domestic and international, related to the production
and importation of non-renewable transportation fuels
that have significant greenhouse gas emissions. The
report shall use appropriate validation procedures,
including sensitivity analyses, of how results change
as assumptions change. The evaluation shall include for
a model, a methodology, or a system of models--
``(I) an assessment of how reliably the
models, methodologies, or systems track actual
outcomes over historical periods using
available historical data; and
``(II) an assessment of how reliably the
models, methodologies or systems will project
future outcomes.
``(iv) The report shall be publicly available and
shall include sufficient information and data such that
economists and other scientists with relevant expertise
that are not on the National Academies of Science panel
can fully evaluate the conclusions of the report.
``(v) The report shall be completed within 3 years
of the date of enactment of this paragraph.
``(C) Determination.--(i) The Administrator and the
Secretary of Agriculture shall, after notice and an
opportunity for public comment, determine whether, for
purposes of determining compliance with the percent
reductions in lifecycle greenhouse gas emissions
specified in paragraph (1) for various renewable fuels,
scientifically valid models and methodologies exist to
project indirect land use changes that are related to
the production of renewable fuels and that occur
outside the country in which the feedstocks are grown,
and the impact of these changes on greenhouse gas
emissions.
``(ii) The determination shall take into account
the findings and recommendations of the report required
under subparagraph (B), as well as other available
scientific, economic, and other relevant information.
The Administrator and the Secretary may also consider
methods used by the Environmental Protection Agency,
the Department of Agriculture, and other Federal
agencies to assess or guide their related policies.
``(iii) The Administrator and the Secretary of
Agriculture shall publish a proposed determination not
later than 4 years after date of enactment of this
paragraph, and shall publish a final determination not
later than 5 years after date of enactment of this
paragraph. An explanation and justification of the
determination shall be included in the proposed and
final actions, together with a response to comments
received.
``(D) Response to determination.--(i) In the event
of a positive determination under subparagraph (C), the
Administrator and the Secretary of Agriculture shall,
after notice and an opportunity for public comment, by
the same date jointly establish a methodology (or
methodologies) to calculate greenhouse gas emissions
from indirect land use changes that are attributable to
the production of renewable fuels and that occur
outside the country in which feedstocks are grown for
purposes of calculating a renewable fuel's lifecycle
greenhouse gas emissions to determine whether the fuel
meets a definition in paragraph (1) or complies with
paragraph (2)(A)(i). The exclusion in subparagraph (A)
shall end, and the Administrator shall issue a
regulation by the same date that shall include
emissions from indirect land use changes outside the
renewable fuel's feedstock's country of origin for
purposes of calculating a renewable fuel's lifecycle
greenhouse gas emissions to determine whether the fuel
meets a definition in paragraph (1) or complies with
paragraph (2)(A)(i) for renewable fuels sold in the
calendar year following the year of the positive
determination. The effective date of the regulation
shall be 6 years after the date of enactment of this
paragraph.
``(ii) A negative determination under subparagraph
(C) shall include a statement of the basis for the
determination.
``(E) Accountability.--The joint duties and actions
of the Administrator and the Secretary of Agriculture
shall be subject to sections 304 and 307 of this Act as
if they were the duties and actions of the
Administrator alone.''.
SEC. 552. BIOMASS-BASED DIESEL.
Section 211(o)(2)(A) of the Clean Air Act (42 U.S.C. 7545(o)(2)(A))
is amended by adding at the end the following new clause:
``(v) Grandfathering biomass-based
diesel.--The Administrator shall promulgate
regulations exempting from the lifecycle
greenhouse gas requirements in subparagraphs
(B) and (D) of paragraph (1) up to the greater
of 1 billion gallons or the volume mandate
adopted pursuant to subparagraph (B)(ii) of
biomass-based diesel annually from facilities
that commenced construction before the date of
enactment of the Energy Independence and
Security Act of 2007.''.
SEC. 553. MODIFICATION OF DEFINITION OF RENEWABLE BIOMASS.
(a) National Academy of Sciences Report.--Not later than 1 year
after the date of enactment of this Act, the Administrator of the
Environmental Protection Agency, the Secretary of Agriculture, and the
Federal Energy Regulatory Commission shall jointly arrange for the
National Academy of Sciences to evaluate how sources of renewable
biomass contribute to the goals of increasing America's energy
independence, protecting the environment, and reducing global warming
pollution.
(b) Modification.--
(1) EPA modification authority.--After reviewing the report
required by subsection (a), the Administrator of the
Environmental Protection Agency, in concurrence with the
Secretary of Agriculture, may, by regulation and after public
notice and comment, modify the non-Federal lands portion of the
definition of ``renewable biomass'' in sections 211(o)(1)(I)
and 700 of the Clean Air Act in order to advance the goals of
increasing America's energy independence, protecting the
environment, and reducing global warming pollution.
(2) FERC modification authority.--After reviewing the
report required by subsection (a), the Federal Energy
Regulatory Commission, in concurrence with the Secretary of
Agriculture, may, by regulation and after public notice and
comment, modify the non-Federal lands portion of the definition
of ``renewable biomass'' in section 610 of the Public Utility
Regulatory Policies Act of 1978 in order to advance the goals
of increasing America's energy independence, protecting the
environment, and reducing global warming pollution.
(c) Federal Lands.--
(1) Scientific review.--The Secretary of the Interior, the
Secretary of Agriculture, and the Administrator of the
Environmental Protection Agency shall conduct a joint
scientific review, within 1 year after the date of enactment of
this Act, to evaluate how sources of biomass from Federal lands
could contribute to the goals of increasing America's energy
independence, protecting the environment, and reducing global
warming pollution.
(2) Modification authority.--Based on the scientific
review, the agencies may, by rule, modify the definition of
``renewable biomass'' from Federal lands in sections
211(o)(1)(I) and 700 of the Clean Air Act and section 610 of
the Public Utility Regulatory Policies Act of 1978 as
appropriate to advance the goals of increasing America's energy
independence, protecting the environment, and reducing global
warming pollution.
Passed the House of Representatives June 26, 2009.
Attest:
LORRAINE C. MILLER,
Clerk.
Calendar No. 97
111th CONGRESS
1st Session
H. R. 2454
_______________________________________________________________________
AN ACT
To create clean energy jobs, achieve energy independence, reduce global
warming pollution and transition to a clean energy economy.
_______________________________________________________________________
July 7, 2009
Read the second time and placed on the calendar