II 111th CONGRESS 2d Session S. 3634 IN THE SENATE OF THE UNITED STATES July 22, 2010 Mr. Bingaman (for himself and Mr. Udall of New Mexico) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To amend the Internal Revenue Code of 1986 to clarify the types of energy conservation subsidies provided by public utilities eligible for income exclusion.

1.

Clarification of types of energy conservation subsidies provided by public utilities eligible for income exclusion

(a)

In general

Section 136 of the Internal Revenue Code of 1986 is amended by redesignating subsection (d) as subsection (e) and by inserting after subsection (c) the following new subsection: (d)

Net metering or net billing programs; renewable energy credits

(1)

In general

For purposes of this section, the term subsidy includes amounts received by a customer from a public utility— (A)to pay for electricity generated from an energy conservation measure under a net metering or net billing program, or (B)to pay for renewable energy credits attributable to an energy conservation measure. (2)

Limitation

The amount treated as a subsidy for any taxable year by reason of paragraph (1)(B) shall not exceed an amount equal to— (A)$2,000, multiplied by (B)the whole number of years worth of renewable energy credits that are sold by the customer. (3)

No basis reduction

Subsection (b) shall not apply with respect to property any portion of the basis of which is attributable to an amount described in paragraph (1). . (b)

Effective date

The amendments made by this section shall apply to amounts received after the date of the enactment of this Act.