[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3838 Introduced in House (IH)]

113th CONGRESS
  2d Session
                                H. R. 3838

   To amend the Internal Revenue Code of 1986 to provide a consumer 
 renewable credit for utilities that sell intermittent renewable power.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 9, 2014

 Mr. Paulsen (for himself and Mr. Kind) introduced the following bill; 
which was referred to the Committee on Ways and Means, and in addition 
      to the Committee on Energy and Commerce, for a period to be 
subsequently determined by the Speaker, in each case for consideration 
  of such provisions as fall within the jurisdiction of the committee 
                               concerned

_______________________________________________________________________

                                 A BILL


 
   To amend the Internal Revenue Code of 1986 to provide a consumer 
 renewable credit for utilities that sell intermittent renewable power.

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

SECTION 1. CONSUMER RENEWABLE CREDIT.

    (a) Business Credit.--
            (1) In general.--Subpart D of part IV of subchapter A of 
        chapter 1 of the Internal Revenue Code of 1986 is amended by 
        adding at the end the following new section:

``SEC. 45S. CONSUMER RENEWABLE CREDIT.

    ``(a) General Rule.--For purposes of section 38, in the case of an 
eligible taxpayer, the consumer renewable credit for any taxable year 
is an amount equal to the product of--
            ``(1) the renewable portfolio factor of such eligible 
        taxpayer, and
            ``(2) the number of kilowatt hours of renewable 
        electricity--
                    ``(A) purchased or produced by such taxpayer, and
                    ``(B) sold by such taxpayer to a retail customer 
                during the taxable year and before January 1, 2020.
    ``(b) Renewable Portfolio Factor.--The renewable portfolio factor 
for an eligible taxpayer for any taxable year shall be determined in 
accordance with the following table:


------------------------------------------------------------------------
                                                                 The
                                                              renewable
  ``In the case of a renewable electricity percentage of:     portfolio
                                                              factor is:
------------------------------------------------------------------------
Less than 6 percent........................................   zero cents
At least 6 percent but less than 8 percent.................    0.1 cents
At least 8 percent but less than 12 percent................    0.2 cents
At least 12 percent but less than 16 percent...............    0.3 cents
At least 16 percent but less than 20 percent...............    0.4 cents
At least 20 percent but less than 24 percent...............    0.5 cents
Equal to or greater than 24 percent........................   0.6 cents.
------------------------------------------------------------------------

    ``(c) Definitions and Special Rules.--For purposes of this 
section--
            ``(1) Eligible taxpayer.--The term `eligible taxpayer' 
        means an electric utility (as defined in section 3(22) of the 
        Federal Power Act, 16 U.S.C. 796(22)).
            ``(2) Renewable electricity.--The term `renewable 
        electricity' means electricity generated by--
                    ``(A) any facility using wind to generate such 
                electricity, or
                    ``(B) any facility using solar energy to generate 
                such electricity.
            ``(3) Renewable electricity percentage.--The term 
        `renewable electricity percentage' means, with respect to any 
        taxable year, the percentage of an eligible taxpayer's total 
        sales of electricity to retail customers that is derived from 
        renewable electricity (determined without regard to whether 
        such electricity was produced by the taxpayer).
            ``(4) Application of other rules.--For purposes of this 
        section, rules similar to the rules of paragraphs (1), (3), and 
        (5) of section 45(e) shall apply.
            ``(5) Credit allowed only with respect to one eligible 
        entity.--No credit shall be allowed under subsection (a) with 
        respect to renewable electricity purchased from another 
        eligible entity if a credit has been allowed under this section 
        or a payment has been made under section 6433 to such other 
        eligible entity.
            ``(6) Credit and renewable electricity percentage 
        enhancement.--
                    ``(A) Native american wind and solar.--Any 
                renewable electricity generated from a wind or solar 
                energy facility located on Indian land, as defined in 
                section 2601 of the Energy Policy Act of 1992 (25 
                U.S.C. 3501), shall for purposes of this section be 
                considered as twice the electricity production as is 
                actually produced from such facility.
                    ``(B) Electric cooperative wind and solar.--Any 
                renewable electricity generated from a wind or solar 
                energy facility owned entirely by a mutual or 
                cooperative electric company, as defined in section 
                501(c)(12), or section 1381(a)(2)(C), shall for 
                purposes of this section be considered as one and one-
                half times the electricity production as is actually 
                produced from such facility.
    ``(d) Coordination With Payments.--The amount of the credit 
determined under this section with respect to any electricity shall be 
reduced to take into account any payment provided with respect to such 
electricity solely by reason of the application of section 6433.''.
            (2) Credit made part of general business credit.--
        Subsection (b) of section 38 of the Internal Revenue Code of 
        1986 is amended by striking ``plus'' at the end of paragraph 
        (35), by striking the period at the end of paragraph (36) and 
        inserting ``, plus'', and by adding at the end the following 
        new paragraph:
            ``(37) the consumer renewable credit determined under 
        section 45S(a).''.
            (3) Specified credit.--Subparagraph (B) of section 38(c)(4) 
        of the Internal Revenue Code of 1986 is amended by 
        redesignating clauses (vii) through (ix) as clauses (viii) 
        through (x), respectively, and by inserting after clause (v) 
        the following new clause:
                            ``(vi) the credit determined under section 
                        45S.''.
            (4) Clerical amendment.--The table of sections for subpart 
        D of part IV of subchapter A of chapter 1 of the Internal 
        Revenue Code of 1986 is amended by adding at the end the 
        following new item:

``Sec. 45S. Consumer renewable credit.''.
    (b) Payments in Lieu of Credit.--
            (1) In general.--Subchapter B of chapter 65 of the Internal 
        Revenue Code of 1986 is amended by adding at the end the 
        following new section:

``SEC. 6433. CONSUMER RENEWABLE CREDIT PAYMENTS.

    ``(a) In General.--If any eligible person sells renewable 
electricity to a retail customer, the Secretary shall pay (without 
interest) to any such person who elects to receive a payment an amount 
equal to the product of--
            ``(1) the renewable portfolio factor of such eligible 
        person, and
            ``(2) the number of kilowatt hours of renewable 
        electricity--
                    ``(A) purchased or produced by such person, and
                    ``(B) sold by such person in the trade or business 
                of such person to a retail customer before January 1, 
                2020.
    ``(b) Timing of Payments.--
            ``(1) In general.--Except as provided in paragraph (2), 
        rules similar to the rules of section 6427(i)(1) shall apply 
        for purposes of this section.
            ``(2) Quarterly payments.--
                    ``(A) In general.--If, at the close of any quarter 
                of the taxable year of any person (or fiscal year in 
                the case of an eligible person that does not have a 
                taxable year), at least $750 is payable in the 
                aggregate under subsection (a), to such person with 
                respect to electricity purchased or produced during--
                            ``(i) such quarter, or
                            ``(ii) any prior quarter (for which no 
                        other claim has been filed) during such year,
                a claim may be filed under this section with respect to 
                such electricity.
                    ``(B) Time for filing claim.--No claim filed under 
                this paragraph shall be allowed unless filed on or 
                before the last day of the first quarter following the 
                earliest quarter included in the claim.
    ``(c) Definitions and Special Rules.--For purposes of this 
section--
            ``(1) Eligible person.--The term `eligible person' means an 
        electric utility (as defined in section 3(22) of the Federal 
        Power Act, 16 U.S.C. 796(22)) or a Federal power marketing 
        agency as defined in section 3(19) of the Federal Power Act.
            ``(2) Other definitions.--Any term used in this section 
        which is also used in section 45S shall have the meaning given 
        such term under section 45S.
            ``(3) Application of other rules.--For purposes of this 
        section, rules similar to the rules of paragraphs (1) and (3) 
        of section 45(e) shall apply.
    ``(d) Payment Disallowed Unless Amount Passed to Third-Party 
Generators Charged for Integration Costs.--
            ``(1) In general.--In the case of renewable electricity 
        eligible for the payment under subsection (a) that is purchased 
        and not produced by an eligible person, no payment shall be 
        made under this section unless any charge the eligible person 
        has assessed the seller to recover the integration costs 
        associated with such electricity has been reduced (but not 
        below zero) to the extent of the payment received under 
        subsection (a) associated with such electricity.
            ``(2) Definitions.--For purposes of paragraph (1), charges 
        intended to recover integration costs do not include amounts 
        paid by the producer of the electricity for interconnection 
        facilities, distribution upgrades, network upgrades, or stand-
        alone network upgrades as those terms have been defined by the 
        Federal Energy Regulatory Commission in its Standard 
        Interconnection Procedures.
    ``(e) Payment Allowed for Special Generating and Transmitting 
Entities.--
            ``(1) In general.--Notwithstanding subsection (a)(1)(B), an 
        entity that is a special generating and transmitting entity 
        shall be eligible for a payment under this section for 
        renewable electricity it transmits, regardless of whether such 
        utility purchased or sold such electricity for its customers.
            ``(2) Definitions.--For purposes of this subsection, the 
        term `special generating and transmitting entity' means--
                    ``(A) an entity that is primarily engaged in 
                marketing electricity and--
                            ``(i) provides transmission service for 
                        over four thousand megawatts of renewable 
                        generating facilities, as determined by 
                        reference to the machine or nameplate capacity 
                        thereof, and
                            ``(ii) transmits the majority of its 
                        renewable electricity transmitted to customers 
                        located outside the region it serves, or
                    ``(B) an entity that is a generation and 
                transmission cooperative, which engages primarily in 
                providing wholesale electric service to its members, 
                generally consisting of distribution cooperatives.''.
            (2) Clerical amendment.--The table of sections for subpart 
        B of chapter 65 of the Internal Revenue Code of 1986 is amended 
        by adding at the end the following new item:

``Sec. 6433. Renewable electricity integration payments.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to electricity sold to retail customers after the date of the 
enactment of this Act.
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