[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[S. 1914 Introduced in Senate (IS)]

112th CONGRESS
  1st Session
                                S. 1914

  To amend the Internal Revenue Code of 1986 to provide a credit for 
  performance based home energy improvements, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           November 18, 2011

 Ms. Snowe (for herself, Mr. Bingaman, and Mrs. Feinstein) 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 provide a credit for 
  performance based home energy improvements, and for other purposes.

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

SECTION 1. SHORT TITLE; ETC.

    (a) Short Title.--This Act may be cited as the ``Cut Energy Bills 
at Home Act''.
    (b) Amendment of 1986 Code.--Except as otherwise expressly 
provided, whenever in this Act an amendment or repeal is expressed in 
terms of an amendment to, or repeal of, a section or other provision, 
the reference shall be considered to be made to a section or other 
provision of the Internal Revenue Code of 1986.

SEC. 2. PERFORMANCE BASED HOME ENERGY IMPROVEMENTS.

    (a) In General.--Subpart A of part IV of subchapter A of chapter 1 
is amended by adding at the end the following new section:

``SEC. 25E. PERFORMANCE BASED ENERGY IMPROVEMENTS.

    ``(a) In General.--In the case of an individual, there shall be 
allowed as a credit against the tax imposed by this chapter for the 
taxable year for a qualified whole home energy efficiency retrofit an 
amount determined under subsection (b).
    ``(b) Amount Determined.--
            ``(1) In general.--Subject to paragraph (4), the amount 
        determined under this subsection is equal to--
                    ``(A) the base amount under paragraph (2), 
                increased by
                    ``(B) the amount determined under paragraph (3).
            ``(2) Base amount.--For purposes of paragraph (1)(A), the 
        base amount is $2,000, but only if the energy use for the 
        residence is reduced by at least 20 percent below the baseline 
        energy use for such residence as calculated according to 
        paragraph (5).
            ``(3) Increase amount.--For purposes of paragraph (1)(B), 
        the amount determined under this paragraph is $500 for each 
        additional 5 percentage point reduction in energy use.
            ``(4) Limitation.--In no event shall the amount determined 
        under this subsection exceed the lesser of--
                    ``(A) $5,000 with respect to any residence, or
                    ``(B) 30 percent of the qualified home energy 
                efficiency expenditures paid or incurred by the 
                taxpayer under subsection (c) with respect to such 
                residence.
            ``(5) Determination of energy use reduction.--For purposes 
        of this subsection--
                    ``(A) In general.--The reduction in energy use for 
                any residence shall be determined by modeling the 
                annual predicted percentage reduction in total energy 
                costs for heating, cooling, hot water, and permanent 
                lighting. It shall be modeled using computer modeling 
                software approved under subsection (d)(2) and a 
                baseline energy use calculated according to subsection 
                (d)(1)(C).
                    ``(B) Energy costs.--For purposes of subparagraph 
                (A), the energy cost per unit of fuel for each fuel 
                type shall be determined by dividing the total actual 
                energy bill for the residence for that fuel type for 
                the most recent available 12-month period by the total 
                energy units of that fuel type used over the same 
                period.
    ``(c) Qualified Home Energy Efficiency Expenditures.--For purposes 
of this section, the term `qualified home energy efficiency 
expenditures'--
            ``(1) means any amount paid or incurred by the taxpayer 
        during the taxable year for a qualified whole home energy 
        efficiency retrofit, including the cost of diagnostic 
        procedures, labor, and modeling,
            ``(2) includes only measures that have an average estimated 
        life of 5 years or more as determined by the Secretary, after 
        consultation with the Secretary of Energy,
            ``(3) does not include any amount which is paid or incurred 
        in connection with any expansion of the building envelope of 
        the residence, and
            ``(4) does not include improvements to swimming pools or 
        hot tubs or any other expenditure specifically excluded by the 
        Secretary, after consultation with the Secretary of Energy.
    ``(d) Qualified Whole Home Energy Efficiency Retrofit.--For 
purposes of this section--
            ``(1) In general.--The term `qualified whole home energy 
        efficiency retrofit' means the implementation of measures 
        placed in service during the taxable year intended to reduce 
        the energy use of the principal residence of the taxpayer which 
        is located in the United States. A qualified whole home energy 
        efficiency retrofit shall--
                    ``(A) be designed, implemented, and installed by a 
                contractor which is--
                            ``(i) accredited by the Building 
                        Performance Institute (hereafter in this 
                        section referred to as `BPI') or a preexisting 
                        BPI accreditation-based State certification 
                        program with enhancements to achieve State 
                        energy policy,
                            ``(ii) a Residential Energy Services 
                        Network (hereafter in this section referred to 
                        as `RESNET') accredited Energy Smart Home 
                        Performance Team, or
                            ``(iii) accredited by an equivalent 
                        certification program approved by the 
                        Secretary, after consultation with the 
                        Secretary of Energy, for this purpose,
                    ``(B) install a set of measures modeled to achieve 
                a reduction in energy use of at least 20 percent below 
                the baseline energy use established in subparagraph 
                (C), using computer modeling software approved under 
                paragraph (2),
                    ``(C) establish the baseline energy use by 
                calibrating the model using sections 3 and 4 and Annex 
                D of BPI Standard BPI-2400-S-2011: Standardized 
                Qualification of Whole House Energy Savings Estimates, 
                or an equivalent standard approved by the Secretary, 
                after consultation with Secretary of Energy, for this 
                purpose,
                    ``(D) document the measures implemented in the 
                residence through photographs taken before and after 
                the retrofit, including photographs of its visible 
                energy systems and envelope as relevant, and
                    ``(E) implement a test-out procedure, following 
                guidelines of the applicable certification program 
                specified under clause (i) or (ii) of subparagraph (A), 
                or equivalent guidelines approved by the Secretary, 
                after consultation with the Secretary of Energy, for 
                this purpose, to ensure--
                            ``(i) the safe operation of all systems 
                        post retrofit, and
                            ``(ii) that all improvements are included 
                        in, and have been installed according to, 
                        standards of the applicable certification 
                        program specified under clause (i) or (ii) of 
                        subparagraph (A), or equivalent standards 
                        approved by the Secretary, after consultation 
                        with the Secretary of Energy, for this purpose.
                For purposes of subparagraph (A)(iii), an organization 
                or State may submit an equivalent certification program 
                for approval by the Secretary, in consultation with the 
                Secretary of Energy. The Secretary shall approve or 
                deny such submission not later than 180 days after 
                receipt, and, if the Secretary fails to respond in that 
                time period, the submitted equivalent certification 
                program shall be considered approved.
            ``(2) Approved modeling software.--For purposes of 
        paragraph (1)(B), the contractor shall use modeling software 
        certified by RESNET as following the software verification test 
        suites in section 4.2.1 of RESNET Publication No. 06-001 or 
        certified by an alternative organization as following an 
        equivalent standard, as approved by the Secretary, after 
        consultation with the Secretary of Energy, for this purpose.
            ``(3) Documentation.--The Secretary, after consultation 
        with the Secretary of Energy, shall prescribe regulations 
        directing what specific documentation is required to be 
        retained or submitted by the taxpayer in order to claim the 
        credit under this section, which shall include, in addition to 
        the photographs under paragraph (1)(D), a form approved by the 
        Secretary that is completed and signed by the qualified whole 
        home energy efficiency retrofit contractor under penalties of 
        perjury. Such form shall include--
                    ``(A) a statement that the contractor followed the 
                specified procedures for establishing baseline energy 
                use and estimating reduction in energy use,
                    ``(B) the name of the software used for calculating 
                the baseline energy use and reduction in energy use, 
                the percentage reduction in projected energy savings 
                achieved, and a statement that such software was 
                certified for this program by the Secretary, after 
                consultation with the Secretary of Energy,
                    ``(C) a statement that the contractor will retain 
                the details of the calculations and underlying energy 
                bills for 5 years and will make such details available 
                for inspection by the Secretary or the Secretary of 
                Energy, if so requested,
                    ``(D) a list of measures installed and a statement 
                that all measures included in the reduction in energy 
                use estimate are included in, and installed according 
                to, standards of the applicable certification program 
                specified under clause (i) or (ii) of subparagraph (A), 
                or equivalent standards approved by the Secretary, 
                after consultation with the Secretary of Energy,
                    ``(E) a statement that the contractor meets the 
                requirements of paragraph (1)(A), and
                    ``(F) documentation of the total cost of the 
                project in order to comply with the limitation under 
                subsection (b)(4)(B).
    ``(e) Additional Rules.--For purposes of this section--
            ``(1) No double benefit.--
                    ``(A) In general.--With respect to any residence, 
                no credit shall be allowed under this section for any 
                taxable year in which the taxpayer claims a credit 
                under section 25C.
                    ``(B) Renewable energy systems and appliances.--In 
                the case of a renewable energy system or appliance that 
                qualifies for another credit under this chapter, the 
                resulting reduction in energy use shall not be taken 
                into account in determining the percentage energy use 
                reductions under subsection (b).
                    ``(C) No double benefit for certain expenditures.--
                The term `qualified home energy efficiency 
                expenditures' shall not include any expenditure for 
                which a deduction or credit is claimed by the taxpayer 
                under this chapter for the taxable year or with respect 
                to which the taxpayer receives any Federal energy 
                efficiency rebate.
            ``(2) Principal residence.--The term `principal residence' 
        has the same meaning as when used in section 121.
            ``(3) Special rules.--Rules similar to the rules under 
        paragraphs (4), (5), (6), (7), and (8) of section 25D(e) and 
        section 25C(e)(2) shall apply, as determined by the Secretary, 
        after consultation with the Secretary of Energy.
            ``(4) Basis adjustments.--For purposes of this subtitle, if 
        a credit is allowed under this section with respect to any 
        expenditure with respect to any property, the increase in the 
        basis of such property which would (but for this paragraph) 
        result from such expenditure shall be reduced by the amount of 
        the credit so allowed.
            ``(5) Election not to claim credit.--No credit shall be 
        determined under subsection (a) for the taxable year if the 
        taxpayer elects not to have subsection (a) apply to such 
        taxable year.
            ``(6) Multiple year retrofits.--If the taxpayer has claimed 
        a credit under this section in a previous taxable year, the 
        baseline energy use for the calculation of reduced energy use 
        must be established after the previous retrofit has been placed 
        in service.
    ``(f) Termination.--This section shall not apply with respect to 
any costs paid or incurred after December 31, 2016.
    ``(g) Secretary Review.--The Secretary, after consultation with the 
Secretary of Energy, shall establish a review process for the retrofits 
performed, including an estimate of the usage of the credit and a 
statistically valid analysis of the average actual energy use 
reductions, utilizing utility bill data collected on a voluntary basis, 
and report to Congress not later than June 30, 2014, any findings and 
recommendations for--
            ``(1) improvements to the effectiveness of the credit under 
        this section, and
            ``(2) expansion of the credit under this section to rental 
        units.''.
    (b) Conforming Amendments.--
            (1) Section 1016(a) is amended--
                    (A) by striking ``and'' at the end of paragraph 
                (36),
                    (B) by striking the period at the end of paragraph 
                (37) and inserting ``, and'', and
                    (C) by adding at the end the following new 
                paragraph:
            ``(38) to the extent provided in section 25E(e)(4), in the 
        case of amounts with respect to which a credit has been allowed 
        under section 25E.''.
            (2) Section 6501(m) is amended by inserting ``25E(e)(5),'' 
        after ``section''.
            (3) The table of sections for subpart A of part IV of 
        subchapter A chapter 1 is amended by inserting after the item 
        relating to section 25D the following new item:

``Sec. 25E. Performance based energy improvements.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred for a qualified whole home energy 
efficiency retrofit placed in service after December 31, 2011.
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