[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[S. 2433 Introduced in Senate (IS)]

113th CONGRESS
  2d Session
                                S. 2433

To provide assistance to Ukraine to reduce the dependence of Ukraine on 
   imports of natural gas from the Russian Federation, and for other 
                               purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                              June 5, 2014

  Mr. Markey introduced the following bill; which was read twice and 
             referred to the Committee on Foreign Relations

_______________________________________________________________________

                                 A BILL


 
To provide assistance to Ukraine to reduce the dependence of Ukraine on 
   imports of natural gas from the Russian Federation, 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.

    This Act may be cited as the ``Ukrainian Independence from Russian 
Energy Act''.

SEC. 2. FINDINGS.

    Congress makes the following findings:
            (1) Ukraine is dependent on natural gas supplies from the 
        Russian Federation to meet more than half of demand in Ukraine.
            (2) Entities owned by the Government of the Russian 
        Federation have manipulated natural gas supplies and prices in 
        Ukraine in order to gain geopolitical leverage over Ukraine and 
        neighboring countries of Ukraine.
            (3) Energy subsidies provided by the Government of Ukraine 
        amount to roughly 8 percent of the gross domestic product of 
        Ukraine and make energy markets opaque, inefficient, and 
        susceptible to corruption.
            (4) Ukraine is the second-least energy efficient country in 
        the world.
            (5) The International Energy Agency has estimated that if 
        the economy of Ukraine were as energy efficient as the average 
        country in Europe, Ukraine would reduce natural gas consumption 
        by greater than 50 percent.
            (6) The level of savings from the reduction described in 
        paragraph (6) could nearly eliminate the dependence of Ukraine 
        on imports of natural gas from the Russian Federation.
            (7) The World Bank Group has estimated that Ukraine could 
        reduce the amount of natural gas used for heating by 50 percent 
        through efficiency measures.
            (8) On April 25, 2014, a coalition of 35 cities in Ukraine 
        sent a letter urgently requesting assistance in increasing the 
        energy efficiency of their buildings, district heating systems, 
        and transportation networks in order to reduce dependence on 
        imports of natural gas from the Russian Federation.
            (9) A $17,000,000,000 loan package from the International 
        Monetary Fund to help stabilize the economy of Ukraine requires 
        reforms of energy markets in Ukraine and includes provisions to 
        gradually eliminate energy subsidies, which will raise retail 
        natural gas rates by 56 percent in 2014, 40 percent in 2015, 
        and 20 percent in 2016 and 2017.
            (10) Absent large reductions in energy consumption, the 
        rate increases mandated by the International Monetary Fund loan 
        package from the International Monetary Fund could have 
        devastating impacts on low-income households in Ukraine.
            (11) Ukraine is estimated to have significant conventional 
        and unconventional oil and gas reserves, which are mostly 
        untapped.
            (12) The International Energy Agency has estimated that 
        Ukraine possesses natural gas reserves of approximately 
        5,400,000,000,000 cubic meters, although the annexation of 
        Crimea by the Russian Federation may impact Ukraine's 
        recoverable oil and gas reserves.
            (13) Exports of liquefied natural gas from the United 
        States to Ukraine would not provide assistance for Ukraine in 
        the short term and would be unlikely to reach Ukraine in the 
        long term because--
                    (A) of natural gas global market dynamics;
                    (B) there are no liquefied natural gas import 
                facilities in Ukraine; and
                    (C) the Government of Turkey has indicated it would 
                block shipments of liquefied natural gas through the 
                Bosphorus Strait because of safety concerns.

SEC. 3. POLICY ON SUPPORTING ENERGY INDEPENDENCE OF UKRAINE.

    It is the policy of the United States to use all resources of the 
United States Government--
            (1) to coordinate with multi-donor efforts to reform energy 
        subsidies provided by the Government of Ukraine and energy 
        markets in Ukraine;
            (2) to encourage private sector investment in the energy 
        sector of Ukraine;
            (3) to protect low-income households in Ukraine from 
        dramatic increases in energy rates;
            (4) to increase transparency and reduce corruption in the 
        energy sector of Ukraine;
            (5) to improve energy efficiency, increase domestic energy 
        supplies, and develop alternative sources of energy in Ukraine 
        in order to reduce the reliance of Ukraine on energy from the 
        Russian Federation; and
            (6) to increase the capacity of agencies of the Government 
        of Ukraine, nongovernmental organizations, and private entities 
        to administer and manage energy efficiency and energy security-
        related projects in Ukraine.

SEC. 4. ASSISTANCE FROM THE UNITED STATES AGENCY FOR INTERNATIONAL 
              DEVELOPMENT.

    (a) In General.--The Administrator of the United States Agency for 
International Development shall, in fiscal years 2015 through 2017--
            (1) prioritize, to the extent feasible, the provision of 
        direct assistance to Ukraine to improve energy efficiency, 
        increase energy supplies produced in Ukraine, and reduce 
        reliance on energy imports from the Russian Federation through 
        measures described in subsection (b); and
            (2) through the Development Credit Authority, make loan, 
        lease, and bond guarantees to appropriate financial 
        institutions and other eligible borrowers to facilitate the 
        involvement of such institutions and other borrowers in 
        financing and expanding efforts in Ukraine to improve energy 
        efficiency, increase energy supplies produced in Ukraine, and 
        reduce reliance on energy imports from the Russian Federation 
        through measures described in subsection (b).
    (b) Measures Described.--The measures described in this subsection 
include--
            (1) replacing inefficient boilers;
            (2) upgrading district heating systems;
            (3) improving metering and measurement systems for natural 
        gas use and heating;
            (4) upgrading natural gas and heat distribution systems, 
        including pipes that leak or are poorly insulated;
            (5) improving the efficiency of buildings;
            (6) reducing losses in natural gas transmission systems;
            (7) improving the efficiency of compressor stations;
            (8) improving efficiency in the industrial sector;
            (9) legal and regulatory support focused on natural gas and 
        electricity market rules, regulations, and transparency, 
        developed in accordance with the terms of the stand-by 
        arrangement between the International Monetary Fund and 
        Ukraine, approved in April 2014;
            (10) support for structuring of gas and electricity markets 
        with cost-reflective pricing, developed in accordance with the 
        terms of the stand-by arrangement;
            (11) encouraging greater natural gas and electricity 
        interconnections between Ukraine and neighboring countries;
            (12) developing renewable sources of energy; and
            (13) developing energy transmission, refining, and storage 
        facilities.
    (c) Authorization of Appropriations.--There is authorized to be 
appropriated to the Administrator of the United States Agency for 
International Development $10,000,000 for each of fiscal years 2015 
through 2017 to carry out this section.

SEC. 5. ASSISTANCE FROM THE DEPARTMENT OF STATE.

    (a) In General.--The Secretary of State shall, in fiscal years 2015 
through 2017, coordinate the activities of United States agencies 
related to the energy sector of Ukraine and prioritize, to the extent 
feasible, support and technical assistance to increase responsible 
production in and transparency of the natural gas sector in Ukraine 
through measures that include--
            (1) resource and technology assessments;
            (2) evaluation of production capabilities;
            (3) economic assessments of potential resources; and
            (4) dissemination of international best practices and 
        provision of legal and regulatory information and guidance to 
        help establish energy policies that--
                    (A) protect public health and safety;
                    (B) protect the environment;
                    (C) effectively manage royalties and revenue; and
                    (D) increase transparency and reduce corruption.
    (b) Authorization of Appropriations.--There is authorized to be 
appropriated to the Secretary of State $2,500,000 for each of fiscal 
years 2015 through 2017 to carry out this section.

SEC. 6. PROMOTION OF UNITED STATES PRIVATE SECTOR PARTICIPATION IN 
              ENERGY EFFICIENCY AND ENERGY DEVELOPMENT IN UKRAINE.

    (a) In General.--The Director of the Trade and Development Agency 
shall promote United States private sector efforts to help improve 
energy efficiency, develop domestic oil and natural gas reserves, and 
develop renewable sources of energy in Ukraine by--
            (1) conducting and funding project preparation activities, 
        feasibility studies, technical assistance, pilot projects, 
        reverse trade missions, conferences, and workshops; and
            (2) providing any other assistance that the Director 
        considers appropriate to promote such efforts.
    (b) Authorization of Appropriations.--There is authorized to be 
appropriated to the Director of the Trade and Development Agency 
$1,000,000 for each of fiscal years 2015 through 2017 to carry out this 
section.

SEC. 7. SUPPORT FROM THE OVERSEAS PRIVATE INVESTMENT CORPORATION.

    The Overseas Private Investment Corporation shall--
            (1) prioritize support for investments to help increase 
        energy efficiency, develop domestic oil and natural gas 
        reserves, and develop renewable sources of energy in Ukraine; 
        and
            (2) implement procedures for expedited review of and, as 
        appropriate, approval of, applications by eligible investors 
        (as defined in section 238 of the Foreign Assistance Act of 
        1961 (22 U.S.C. 2198)) for loans, loan guarantees, and 
        insurance for such investments.

SEC. 8. SUPPORT FROM THE EXPORT-IMPORT BANK OF THE UNITED STATES.

    The Board of Directors of the Export-Import Bank of the United 
States shall take prompt measures, consistent with the credit standards 
otherwise required by law, to promote the expansion of the financial 
commitments of the Bank under the loan, guarantee, and insurance 
programs and special financing programs of the Bank for projects to 
improve energy efficiency, develop domestic oil and natural gas 
reserves, and develop renewable sources of energy in Ukraine.

SEC. 9. PRIORITIZATION OF ENERGY EFFICIENCY AND DOMESTIC ENERGY 
              PROJECTS IN UKRAINE BY THE WORLD BANK GROUP AND THE 
              EUROPEAN BANK FOR RECONSTRUCTION AND DEVELOPMENT.

    The President shall direct the United States Executive Directors of 
the World Bank Group and the European Bank for Reconstruction and 
Development to use the voice, vote, and influence of the United States 
to encourage the World Bank Group and the European Bank for 
Reconstruction and Development and other international financial 
institutions to invest in, and increase their efforts to promote 
investment in, projects to improve energy efficiency, develop domestic 
oil and natural gas reserves, and develop renewable sources of energy 
in Ukraine, and to stimulate private investment in such projects.

SEC. 10. EFFECTIVENESS MEASUREMENT.

    In providing loan guarantees, assistance, and support pursuant to 
this Act and in prioritizing the projects described in this Act, the 
President and the heads and other appropriate officials of the United 
States Agency for International Development, the Trade and Development 
Agency, the Overseas Private Investment Corporation, and the Export-
Import Bank of the United States shall ensure that the effectiveness of 
such guarantees, assistance, support, and projects is measured through 
the use of clear, accountable, and metric-based targets aimed at 
achieving enhanced energy security for Ukraine.

SEC. 11. BRIEFING ON ALTERNATIVE PIPELINE ACCESS AND SUPPLIES FOR 
              UKRAINE.

    Not later than 30 days after the date of the enactment of this Act, 
the Secretary of State shall provide to the Committee on Foreign 
Relations of the Senate and the Committee on Foreign Affairs of the 
House of Representatives a briefing on--
            (1) the economic and political viability of transporting 
        natural gas supplies into Ukraine from countries other than the 
        Russian Federation through the reversal of existing pipeline 
        flows or through new or expanded pipelines; and
            (2) the potential to reduce natural gas consumption in 
        Ukraine through efficiency measures or through the use of 
        alternative sources of energy.
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