[Congressional Record Volume 147, Number 66 (Tuesday, May 15, 2001)]
[Senate]
[Pages S4961-S4964]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. HARKIN:
  S. 892. A bill to amend the Clean Air Act to phase out the use of 
methyl tertiary butyl ether in fuels of fuel additives, to promote the 
use of renewable fuels, and for other purposes; to the Committee on 
Environment and Public Works.
  Mr. HARKIN. Mr. President, I am introducing today legislation 
designed to address the extensive problems that have been caused by the 
gasoline additive methyl tertiary butyl ether, MTBE, to make 
appropriate revisions to the reformulated gasoline, RFG, program in the 
Clean Air Act, and to increase greatly the use of renewable motor 
vehicle fuels. The bill is similar to legislation I introduced in the 
previous Congress.
  We have to get MTBE out of our gasoline. This is absolutely clear. 
Even in Iowa, where we are not required to have oxygenated fuels or 
RFG, a recent survey found a surprising level of water contamination 
with MTBE. So my legislation requires a phased reduction in the use of 
MTBE in motor fuel and then a prohibition of MTBE in fuel or fuel 
additives beginning three years after enactment.
  My legislation recognizes the benefits that have been provided by the 
oxygen content requirement in the reformulated gasoline program. Oxygen 
added to gasoline reduces emissions of carbon monoxide, toxic compounds 
and fine particulate matter. So my legislation continues the oxygen 
content requirement, but it would allow, in certain circumstances upon 
a proper showing, averaging of the oxygen content requirement over a 
period of time up to a year.
  The legislation also ensures that all health benefits of the 
reformulated gasoline program are maintained and improved, and includes 
very strong provisions to ensure that there is no backsliding in air 
quality and health benefits from cleaner burning reformulated gasoline. 
The petroleum companies would also be prohibited from taking the 
pollutants from gasoline in some areas and putting them back into 
gasoline in other areas of the country that are not subject to the more 
stringent air quality standards. Those are referred to as the anti-
dumping protections. My bill places tighter restrictions on highly 
polluting aromatic and olefin content of reformulated gasoline.
  My legislation also recognizes the important role of renewable fuels 
in improving our environment, building energy security for out nation, 
and increasing farm income, economic growth and job creation, 
especially in rural areas. The legislation creates a national renewable 
content requirement for motor vehicle fuel. The requirement would not 
be a mandate that any particular user of gasoline or diesel fuel has to 
use the renewable fuel, but it would require the petroleum industry to 
ensure that renewable fuels make up a certain minimum percentage of the 
total U.S. supply of motor vehicle fuel, gasoline and diesel fuel. By 
2011, that percentage would be about 5 percent on a volume basis, 3.3 
percent based on energy content or approximately 10 billion gallons 
based on current estimates of gasoline and diesel consumption.
  Overall, this legislation will get MTBE out of gasoline, maintain and 
improve the air quality and health benefits of the reformulated 
gasoline program and the Clean Air Act, and put our nation on a solid 
path toward greater use of renewable fuels.
  I urge my colleagues to support this important legislation.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 892

       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 ``Clean and Renewable Fuels 
     Act of 2001''.

     SEC. 2. USE AND CLEANUP OF METHYL TERTIARY BUTYL ETHER.

       (a) In General.--Section 211(c) of the Clean Air Act (42 
     U.S.C. 7545(c)) is amended by adding at the end the 
     following:
       ``(5) Prohibition on methyl tertiary butyl ether and other 
     ether compounds.--
       ``(A) Specified nonattainment areas.--
       ``(i) In general.--Effective beginning January 1, 2002, a 
     person shall not sell or dispense to ultimate consumers any 
     fuel or fuel additive containing methyl tertiary butyl ether 
     in an area of the United States other than an area described 
     in clause (ii).
       ``(ii) Areas.--An area described in this clause is an area 
     that is a specified nonattainment area--

       ``(I) that is required to meet the oxygen content 
     requirement for reformulated gasoline established under 
     subsection (k); and
       ``(II) in which methyl tertiary butyl ether was used to 
     meet the oxygen content requirement before January 1, 2001.

       ``(B) Interim period of use of mtbe in a fuel or fuel 
     additive.--
       ``(i) Phased reduction.--

       ``(I) In general.--The Administrator shall promulgate 
     regulations to require--

       ``(aa) during the 1-year period beginning on the date that 
     is 1 year after the date of enactment of this paragraph, a 
     \1/3\ reduction in the quantity of methyl tertiary butyl 
     ether that may be sold or dispensed for use in a fuel or fuel 
     additive;
       ``(bb) during the 1-year period beginning on the date that 
     is 2 years after the date of enactment of this paragraph, a 
     \2/3\ reduction in the quantity of methyl tertiary butyl 
     ether that may be sold or dispensed for use in a fuel or fuel 
     additive; and
       ``(cc) that in no area does the quantity of methyl tertiary 
     butyl ether sold or dispensed for use in a fuel or fuel 
     additive increase.

       ``(II) Basis for reductions.--Reductions under subclause 
     (I) shall be based on the quantity of methyl tertiary butyl 
     ether sold or dispensed for use in a fuel or fuel additive in 
     the United States during the 1-year period ending on the date 
     of enactment of this paragraph.
       ``(III) Equitable treatment.--The regulations promulgated 
     by the Administrator under subclause (I) shall, to the 
     maximum extent practicable, provide equitable treatment--

       ``(aa) on a geographical basis; and
       ``(bb) among fuel manufacturers, refiners, distributors, 
     and retailers.

       ``(IV) Trading of authorizations to sell or dispense 
     mtbe.--To facilitate the most orderly and efficient reduction 
     in the use of methyl tertiary butyl ether in a fuel or fuel 
     additive, the regulations promulgated by the Administrator 
     under subclause (I) may allow for persons subject to the 
     regulations to sell to and purchase from each other 
     authorizations to sell or dispense methyl tertiary butyl 
     ether for use in a fuel or fuel additive.

       ``(ii) Labeling.--

       ``(I) In general.--The Administrator shall promulgate 
     regulations that require any person selling or dispensing 
     gasoline that contains methyl tertiary butyl ether at retail 
     prominently to label the gasoline dispensing system for the 
     gasoline with a notice--

       ``(aa) stating that the gasoline contains methyl tertiary 
     butyl ether; and
       ``(bb) providing such information concerning the human 
     health and environmental risks associated with methyl 
     tertiary butyl ether as the Administrator determines to be 
     appropriate.

       ``(II) Period of effectiveness.--The regulations 
     promulgated under subclause (I) shall be effective during the 
     period--

       ``(aa) beginning as soon as practicable, but not later than 
     60 days, after the date of enactment of this paragraph; and
       ``(bb) ending on the date that is 3 years after the date of 
     enactment of this paragraph.
       ``(C) Prohibition on use of mtbe in a fuel or fuel 
     additive.--Effective beginning on the date that is 3 years 
     after the date of enactment of this paragraph, a person shall 
     not manufacture, introduce into commerce, offer for sale, 
     sell, or dispense a fuel or fuel additive containing methyl 
     tertiary butyl ether or any other ether compound.
       ``(D) Waiver.--The Administrator may by regulation waive 
     the prohibition under subparagraph (C) with respect to an 
     ether compound other than methyl tertiary butyl ether if the 
     Administrator determines that the use of the ether compound 
     in a fuel or fuel additive will not pose a significant risk 
     to human health or the environment.
       ``(E) Areas of mtbe contamination.--If the Administrator 
     finds that methyl tertiary butyl ether is contaminating or 
     posing a substantial risk of contamination of soil, ground 
     water, or surface water in an area, the Administrator may 
     take such action as is necessary to protect human health and 
     the environment in the area, including requiring a more rapid 
     reduction (including immediate termination) of the quantity 
     of methyl tertiary butyl ether sold or dispensed for use in a 
     fuel or fuel additive in the area than required under 
     subparagraph (A) or (B).
       ``(F) State authority to regulate mtbe.--Notwithstanding 
     any other provision of law, a State may impose such 
     restrictions, including a prohibition, on the manufacture, 
     sale, or use of methyl tertiary butyl ether in a fuel or fuel 
     additive as the State determines to be appropriate to protect 
     human health and the environment.''.
       (b) Remedial Action Concerning MTBE Contamination.--
       (1) Underground storage tanks.--Section 9003(h) of the 
     Solid Waste Disposal Act (42 U.S.C. 6991b(h)) is amended by 
     striking paragraph (3) and inserting the following:
       ``(3) Priority.--In carrying out a corrective action under 
     this subsection, or in issuing an order that requires an 
     owner or operator to carry out a corrective action under this 
     subsection, the Administrator (or

[[Page S4962]]

     a State under paragraph (7)) shall give priority to a release 
     of petroleum from an underground storage tank that poses the 
     greatest threat to human health, human welfare, and the 
     environment.''.
       (2) Cleanup guidelines.--Section 1442 of the Safe Drinking 
     Water Act (42 U.S.C. 300j-1) is amended by adding at the end 
     the following:
       ``(f) Cleanup Guidelines for MTBE.--
       ``(1) In general.--The Administrator--
       ``(A) shall develop technical guidelines to assist States, 
     local governments, private landowners, and other interested 
     parties in the investigation and cleanup of methyl tertiary 
     butyl ether in soil or ground water; and
       ``(B) may enter into cooperative agreements with the United 
     States Geological Survey, the Department of Agriculture, 
     States, local governments, private landowners, and other 
     interested parties--
       ``(i) to establish voluntary pilot projects for the cleanup 
     of methyl tertiary butyl ether and the protection of private 
     wells from contamination by methyl tertiary butyl ether; and
       ``(ii) to provide technical assistance in carrying out such 
     projects.
       ``(2) Private wells.--This subsection does not authorize 
     the issuance of guidance or regulations concerning the use or 
     protection of private wells.''.
       (3) State source water assessment programs.--Section 
     1453(a) of the Safe Drinking Water Act (42 U.S.C. 300j-13(a)) 
     is amended by adding at the end the following:
       ``(8) MTBE contamination.--
       ``(A) In general.--The Administrator shall amend the 
     guidance under this subsection to require that State source 
     water assessment programs be revised to give high priority to 
     ground water areas and aquifers that have been contaminated, 
     or are most vulnerable to contamination, by methyl tertiary 
     butyl ether.
       ``(B) Approval of revisions.--Each revision under 
     subparagraph (A) shall be submitted and approved or 
     disapproved by the Administrator in accordance with the 
     schedule described in paragraph (3).''.

     SEC. 3. OXYGEN CONTENT REQUIREMENT UNDER REFORMULATED 
                   GASOLINE PROGRAM.

       Section 211(k)(1) of the Clean Air Act (42 U.S.C. 
     7545(k)(1)) is amended--
       (1) in the first sentence--
       (A) by striking ``Within 1 year after the enactment of the 
     Clean Air Act Amendments of 1990,'' and inserting the 
     following:
       ``(A) In general.--Not later than November 15, 1991,''; and
       (B) by inserting before the period at the end the 
     following: ``and opt-in areas under paragraph (6)'';
       (2) in the second sentence--
       (A) by inserting ``and other'' after ``volatile organic''; 
     and
       (B) by inserting ``and precursors of toxic air pollutants'' 
     after ``toxic air pollutants''; and
       (3) by adding at the end the following:
       ``(B) Waiver of per-gallon oxygen content requirement.--
       ``(i) Procedure for submission of petitions.--The 
     Administrator shall promulgate regulations that establish a 
     procedure providing for the submission of petitions for--

       ``(I) a waiver, with respect to an area, of any per-gallon 
     oxygen content requirement established under paragraph (2)(B) 
     or (3)(A)(v); and
       ``(II) the averaging, with respect to an area, of the 
     oxygen content requirement established under paragraphs 
     (2)(B) and (3)(A)(v) over such period of time, not to exceed 
     1 year, as is determined appropriate by the Administrator.

       ``(ii) Criteria for granting of petitions.--After 
     consultation with the Secretary of Energy and the Secretary 
     of Agriculture, the Administrator shall grant a petition 
     submitted under clause (i) if the Administrator finds that 
     granting the petition is necessary--

       ``(I) to avoid a shortage or disruption in supply of 
     reformulated gasoline;
       ``(II) to avoid the payment by consumers of excessive 
     prices for reformulated gasoline; or
       ``(III) to facilitate the attainment by an area of a 
     national primary ambient air quality standard.

       ``(iii) Maintenance of human health and environmental 
     benefits.--The regulations promulgated under clause (i) shall 
     ensure that the human health and environmental benefits of 
     reformulated gasoline are fully maintained during the period 
     of any waiver of a per-gallon oxygen content requirement.''.

     SEC. 4. LIMITATIONS ON AROMATICS AND OLEFINS IN REFORMULATED 
                   GASOLINE.

       Section 211(k)(3)(A) of the Clean Air Act (42 U.S.C. 
     7545(k)(3)(A)) is amended--
       (1) by striking clause (ii) and inserting the following:
       ``(ii) Aromatics.--

       ``(I) In general.--The aromatic hydrocarbon content of the 
     reformulated gasoline shall not exceed 22 percent by volume.
       ``(II) Average.--The average aromatic hydrocarbon content 
     of the reformulated gasoline shall not exceed the average 
     aromatic hydrocarbon content of reformulated gasoline sold in 
     covered areas for use in baseline vehicles when using 
     reformulated gasoline during either calendar year 1999 or 
     calendar year 2000.
       ``(III) Maximum per gallon.--No gallon of reformulated 
     gasoline shall have an aromatic hydrocarbon content in excess 
     of 30 percent.''; and

       (2) by adding at the end the following:
       ``(vi) Olefins.--

       ``(I) In general.--The olefin content of the reformulated 
     gasoline shall not exceed 8 percent by volume.
       ``(II) Average.--The average olefin content of the 
     reformulated gasoline shall not exceed the average olefin 
     content of reformulated gasoline sold in covered areas for 
     use in baseline vehicles when using reformulated gasoline 
     during either calendar year 1999 or calendar year 2000.

       ``(III) Maximum per gallon.--No gallon of reformulated 
     gasoline shall have an olefin content in excess of 10 
     percent.''.

     SEC. 5. MODIFICATION OF PERFORMANCE STANDARDS.

       Section 211(k)(3)(B) of the Clean Air Act (42 U.S.C. 
     7545(k)(3)(B)) is amended--
       (1) in the last sentence of clause (i), by inserting before 
     the period at the end the following: ``, and, to the maximum 
     extent practicable using available science, determined on the 
     basis of the ozone-forming potential of volatile organic 
     compounds and taking into account the effect on ozone 
     formation of reducing carbon monoxide emissions''; and
       (2) in clause (ii)--
       (A) in the first sentence, by inserting ``, or precursors 
     of toxic air pollutants,'' after ``toxic air pollutants'' 
     each place it appears;
       (B) in the second sentence, by inserting before the period 
     at the end the following: ``, or precursors of toxic air 
     pollutants'';
       (C) in the third sentence, by inserting ``, or 
     precursors,'' after ``such air pollutants''; and
       (D) in the last sentence, by inserting before the period at 
     the end the following: ``, and, to the maximum extent 
     practicable using available science, determined on the basis 
     of the relative toxicity or carcinogenic potency, whichever 
     is more protective of human health and the environment''.

     SEC. 6. ANTI-BACKSLIDING.

       (a) In General.--Section 211(k)(3)(B) of the Clean Air Act 
     (42 U.S.C. 7545(k)(3)(B)) is amended--
       (1) in the last sentence, by striking ``Any reduction'' and 
     inserting the following:
       ``(iii) Treatment of greater reductions.--Any reduction''; 
     and
       (2) by adding at the end the following:
       ``(iv) Anti-backsliding provision.--

       ``(I) In general.--Not later than October 1, 2001, the 
     Administrator shall revise performance standards under this 
     subparagraph as necessary to ensure that--

       ``(aa) the ozone-forming potential, taking into account all 
     ozone precursors (including volatile organic compounds, 
     oxides of nitrogen, and carbon monoxide), of the aggregate 
     emissions during the high ozone season (as determined by the 
     Administrator) from baseline vehicles when using reformulated 
     gasoline does not exceed the ozone-forming potential of the 
     aggregate emissions during the high ozone season from 
     baseline vehicles when using reformulated gasoline that 
     complies with the regulations that were in effect on January 
     1, 2000, and were applicable to reformulated gasoline sold in 
     calendar year 2000 and subsequent calendar years; and
       ``(bb) the aggregate emissions of the pollutants specified 
     in subclause (II), or precursors of those pollutants, from 
     baseline vehicles when using reformulated gasoline do not 
     exceed the aggregate emissions of those pollutants, or 
     precursors, from baseline vehicles when using reformulated 
     gasoline that complies with the regulations that were in 
     effect on January 1, 2000, and were applicable to 
     reformulated gasolines sold in calendar year 2000 and 
     subsequent calendar years.

       ``(II) Specified pollutants.--The pollutants specified in 
     this subclause are--

       ``(aa) toxic air pollutants, categorized by degree of 
     toxicity and carcinogenic potency;
       ``(bb) particulate matter (PM-10) and fine particulate 
     matter (PM-2.5);
       ``(cc) pollutants regulated under section 108; and
       ``(dd) such other pollutants, and precursors to pollutants, 
     as the Administrator determines by regulation should be 
     controlled to prevent the deterioration of air quality and to 
     achieve attainment of a national ambient air quality standard 
     in 1 or more areas.

       ``(III) Adjustment for emissions of carbon monoxide.--

       ``(aa) In general.--In carrying out subclause (I), the 
     Administrator shall adjust the performance standard for 
     emissions of volatile organic compounds under this 
     subparagraph to account for emissions of carbon monoxide that 
     are greater than or less than the carbon monoxide baseline 
     determined under item (bb).
       ``(bb) Carbon monoxide baseline.--The carbon monoxide 
     baseline shall be equal to the mass carbon monoxide emissions 
     achieved by reformulated gasoline that contains 2 percent 
     oxygen by weight and meets the other performance standards 
     under this subparagraph.''.
       (b) Reformulated Gasoline Carbon Monoxide Reduction 
     Credit.--Section 182(c)(2)(B) of the Clean Air Act (42 U.S.C. 
     7511a(c)(2)(B)) is amended by adding at the end the 
     following: ``An adjustment to the volatile organic compound 
     emission reduction requirements under section 
     211(k)(3)(B)(iv) shall be credited toward the requirement for 
     VOC emissions reductions under this subparagraph.''.

     SEC. 7. CERTIFICATION OF FUELS AS EQUIVALENT TO REFORMULATED 
                   GASOLINE.

       Section 211(k)(4)(B) of the Clean Air Act (42 U.S.C. 
     7545(k)(4)(B)) is amended--

[[Page S4963]]

       (1) by redesignating clauses (i) and (ii) as subclauses (I) 
     and (II), respectively, and indenting appropriately to 
     reflect the amendments made by this section;
       (2) by striking ``The Administrator'' and inserting the 
     following:
       ``(i) In general.--The Administrator'';
       (3) in clause (i) (as designated by paragraph (2))--
       (A) in subclause (I) (as redesignated by paragraph (1)), by 
     striking ``, and'' and inserting a semicolon;
       (B) in subclause (II) (as redesignated by paragraph (1))--
       (i) by striking ``achieve equivalent'' and inserting the 
     following: ``achieve--
       ``(aa) equivalent'';
       (ii) by striking the period at the end and inserting ``; 
     or''; and
       (iii) by adding at the end the following:
       ``(bb) combined reductions in emissions of ozone forming 
     volatile organic compounds and carbon monoxide that result in 
     a reduction in ozone concentration, as provided in clause 
     (ii)(I), that is equivalent to or greater than the reduction 
     in ozone concentration achieved by a reformulated gasoline 
     meeting the applicable requirements of paragraph (3);''; and
       (C) by adding at the end the following:

       ``(III) achieve equivalent or greater reductions in 
     emissions of toxic air pollutants, or precursors of toxic air 
     pollutants, than are achieved by a reformulated gasoline 
     meeting the applicable requirements of paragraph (3); and
       ``(IV) meet the requirements of paragraph (3)(B)(iv).''; 
     and

       (4) by adding at the end the following:
       ``(ii) Carbon monoxide credit.--

       ``(I) In general.--In determining whether a fuel 
     formulation or slate of fuel formulations achieves combined 
     reductions in emissions of ozone forming volatile organic 
     compounds and carbon monoxide in an area that result in a 
     reduction in ozone concentration that is equivalent to or 
     greater than the reduction in ozone concentration achieved by 
     a reformulated gasoline meeting the applicable requirements 
     of paragraph (3) in the area, the Administrator--

       ``(aa) shall consider, to the extent appropriate, the 
     change in carbon monoxide emissions from baseline vehicles 
     attributable to an oxygen content in the fuel formulation or 
     slate of fuel formulations that exceeds any minimum oxygen 
     content requirement for reformulated gasoline applicable to 
     the area; and
       ``(bb) may consider, to the extent appropriate, the change 
     in carbon monoxide emissions described in item (aa) from 
     vehicles other than baseline vehicles.

       ``(II) Oxygen credits.--Any excess oxygen content that is 
     taken into consideration in making a determination under 
     subclause (I) may not be used to generate credits under 
     paragraph (7)(A).
       ``(III) Relation to title i.--Any fuel formulation or slate 
     of fuel formulations that is certified as equivalent or 
     greater under this subparagraph, taking into consideration 
     the combined reductions in emissions of volatile organic 
     compounds and carbon monoxide, shall receive the same 
     volatile organic compounds reduction credit for the purposes 
     of subsections (b)(1) and (c)(2)(B) of section 182 as a fuel 
     meeting the applicable requirements of paragraph (3).''.

     SEC. 8. ADDITIONAL OPT-IN AREAS UNDER REFORMULATED GASOLINE 
                   PROGRAM.

       Section 211(k)(6) of the Clean Air Act (42 U.S.C. 
     7545(k)(6)) is amended--
       (1) by striking ``(6) Opt-in areas.--(A) Upon'' and 
     inserting the following:
       ``(6) Opt-in areas.--
       ``(A) Classified areas.--
       ``(i) In general.--Upon'';
       (2) in subparagraph (B), by striking ``(B) If'' and 
     inserting the following:
       ``(ii) Effect of insufficient domestic capacity to produce 
     reformulated gasoline.--If'';
       (3) in subparagraph (A)(ii) (as so redesignated)--
       (A) in the first sentence, by striking ``subparagraph (A)'' 
     and inserting ``clause (i)''; and
       (B) in the second sentence, by striking ``this paragraph'' 
     and inserting ``this subparagraph''; and
       (4) by adding at the end the following:
       ``(B) Nonclassified areas.--
       ``(i) In general.--Upon the application of the Governor of 
     a State, the Administrator shall apply the prohibition 
     specified in paragraph (5) in any area in the State that is 
     not a covered area or an area referred to in subparagraph 
     (A)(i).
       ``(ii) Publication of application.--As soon as practicable 
     after receipt of an application under clause (i), the 
     Administrator shall publish the application in the Federal 
     Register.''.

     SEC. 9. UPDATING OF BASELINE YEAR.

       (a) In General.--Section 211(k)(8) of the Clean Air Act (42 
     U.S.C. 7545(k)(8)) is amended--
       (1) by striking subparagraph (A) and inserting the 
     following:
       ``(A) Regulations.--
       ``(i) Emissions.--The Administrator shall promulgate 
     regulations applicable to each refiner, blender, or importer 
     of gasoline ensuring that gasoline sold or introduced into 
     commerce by the refiner, blender, or importer (other than 
     reformulated gasoline subject to the requirements of 
     paragraph (1)) does not result in average per gallon 
     emissions of--

       ``(I) volatile organic compounds;
       ``(II) oxides of nitrogen;
       ``(III) carbon monoxide;
       ``(IV) toxic air pollutants;
       ``(V) particulate matter (PM-10) or fine particulate matter 
     (PM-2.5); or
       ``(VI) any precursor of a pollutant specified in subclauses 
     (I) through (V);

     in excess of such emissions of such pollutants attributable 
     to gasoline sold or introduced into commerce in calendar year 
     1999 or calendar year 2000, in whichever occurred the lower 
     of such emissions, by that refiner, blender, or importer.
       ``(ii) Measurement of average per gallon emissions.--For 
     the purposes of clause (i), average per gallon emissions 
     shall be measured on the basis of--

       ``(I) mass; and
       ``(II) to the maximum extent practicable using available 
     science--

       ``(aa) ozone-forming potential;
       ``(bb) degree of toxicity; and
       ``(cc) carcinogenic potency.
       ``(iii) Aromatic hydrocarbon content and olefin content.--
     The Administrator shall promulgate regulations applicable to 
     each refiner, blender, or importer of gasoline ensuring that 
     gasoline sold or introduced into commerce by the refiner, 
     blender, or importer (other than reformulated gasoline 
     subject to the requirements of paragraph (1)) does not have 
     an aromatic hydrocarbon content or olefin content in excess 
     of such content of gasoline sold or introduced into commerce 
     in calendar year 1999 or calendar year 2000, in whichever 
     occurred the lower of such content, by that refiner, blender, 
     or importer.'';
       (2) in subparagraph (C)--
       (A) by striking ``clauses (i) through (iv)'' and inserting 
     ``subclauses (I) through (VI) of subparagraph (A)(i)'';
       (B) by inserting ``or volatile organic compounds'' after 
     ``nitrogen''; and
       (C) by striking ``(on a mass basis)'' and inserting ``(as 
     measured in accordance with subparagraph (A)(ii))''; and
       (3) in subparagraph (E)--
       (A) by striking ``calendar year 1990'' and inserting 
     ``calendar year 1999 or calendar year 2000 (as determined 
     under subparagraph (A)(i))''; and
       (B) by striking ``such 1990 gasoline'' and inserting ``such 
     1999 or 2000 gasoline''.
       (b) Regulations.--As soon as practicable after the date of 
     enactment of this Act, the Administrator of the Environmental 
     Protection Agency shall revise the regulations promulgated 
     under section 211(k) of the Clean Air Act (42 U.S.C. 7545(k)) 
     to reflect the amendments made by subsection (a).

     SEC. 10. RENEWABLE CONTENT OF GASOLINE AND DIESEL FUEL.

       (a) In General.--Section 211 of the Clean Air Act (42 
     U.S.C. 7545) is amended--
       (1) by redesignating subsection (o) as subsection (p); and
       (2) by inserting after subsection (n) the following:
       ``(o) Renewable Content of Motor Vehicle Fuel.--
       ``(1) In general.--
       ``(A) Regulations.--Not later than September 1, 2001, the 
     Administrator shall promulgate regulations applicable to each 
     refiner, blender, or importer of motor vehicle fuel to ensure 
     that motor vehicle fuel sold or introduced into commerce in 
     the United States by the refiner, blender, or importer 
     complies with the renewable content requirements of this 
     subsection.
       ``(B) Renewable content requirements.--
       ``(i) In general.--All motor vehicle fuel sold or 
     introduced into commerce in the United States by a refiner, 
     blender, or importer shall contain, on a semiannual average 
     basis, a quantity of fuel derived from a renewable source, 
     measured on a gasoline-equivalent energy content basis (as 
     determined by the Secretary of Energy) that is not less than 
     the applicable percentage by volume for the semiannual 
     period.
       ``(ii) Applicable percentage.--For the purposes of clause 
     (i), the applicable percentage for a semiannual period of a 
     calendar year shall be determined in accordance with the 
     following table:

                                                  Applicable percentage
                                                 of fuel derived from a
``Calendar year:                                      renewable source:
  2001.........................................................0.8 ....

  2002.........................................................1.0 ....

  2003.........................................................1.2 ....

  2004.........................................................1.4 ....

  2005.........................................................1.6 ....

  2006.........................................................1.8 ....

  2007.........................................................2.1 ....

  2008.........................................................2.4 ....

  2009.........................................................2.7 ....

  2010.........................................................3.0 ....

  2011 and thereafter..........................................3.3.....

       ``(C) Fuel derived from a renewable source.--For the 
     purposes of this subsection, a fuel shall be considered to be 
     derived from a renewable source if the fuel--
       ``(i) is produced from--

       ``(I) agricultural commodities, agricultural products, or 
     residues of agricultural commodities or agricultural 
     products;
       ``(II) plant materials, including grasses, fibers, wood, 
     and wood residues;
       ``(III) dedicated energy crops and trees;
       ``(IV) animal wastes, animal byproducts, and other 
     materials of animal origin;
       ``(V) municipal wastes and refuse derived from plant or 
     animal sources; and
       ``(VI) other biomass; and

       ``(ii) is used to replace or reduce the quantity of fossil 
     fuel present in a fuel mixture used to operate a motor 
     vehicle, motor vehicle engine, nonroad vehicle, or nonroad 
     engine.

[[Page S4964]]

       ``(D) Credit program.--
       ``(i) In general.--The regulations promulgated under this 
     subsection shall provide for the generation of an appropriate 
     amount of credits by a person that refines, blends, or 
     imports motor vehicle fuel that contains, on a semiannual 
     average basis, a quantity of fuel derived from a renewable 
     source that is greater than the quantity required under 
     subparagraph (B).
       ``(ii) Use of credits.--The regulations shall provide that 
     a person that generates the credits may use the credits, or 
     transfer all or a portion of the credits to another person, 
     for the purpose of complying with subparagraph (B).
       ``(iii) Regulations to prevent excessive geographical 
     concentration.--The Administrator, in consultation with the 
     Secretary of Energy and the Secretary of Agriculture, may 
     promulgate regulations governing the generation and trading 
     of credits described in clause (i) in order to prevent 
     excessive geographical concentration in the use of fuel 
     derived from a renewable source that would tend unduly--

       ``(I) to affect the price, supply, or distribution of such 
     fuel;
       ``(II) to impede the development of the renewable fuels 
     industry; or
       ``(III) to otherwise interfere with the purposes of this 
     subsection.

       ``(2) Waivers.--
       ``(A) In general.--The Administrator, in consultation with 
     the Secretary of Agriculture and the Secretary of Energy, may 
     waive the requirements of paragraph (1)(B) with respect to an 
     area in whole or in part on petition by a State--
       ``(i) based on a determination by the Administrator, after 
     public notice and opportunity for comment, that--

       ``(I) implementation of the requirements would severely 
     harm the economy or environment of the area; or
       ``(II) there is an inadequate domestic supply or 
     distribution capacity with respect to fuel from renewable 
     sources in the area to meet the requirements of paragraph 
     (1)(B); and

       ``(ii) only after a determination by the Administrator that 
     use of the credit program described in paragraph (1)(D) would 
     not adequately alleviate the circumstances on which the 
     petition is based.
       ``(B) Approval.--The Administrator shall approve a waiver 
     under subparagraph (A) only to the extent necessary to--
       ``(i) avoid severe economic or environmental harm; or
       ``(ii) equalize demand with supply or distribution 
     capacity.
       ``(C) Petitions for waivers.--The Administrator, in 
     consultation with the Secretary of Agriculture and the 
     Secretary of Energy--
       ``(i) shall approve or deny a State petition for a waiver 
     of the requirements of paragraph (1)(B) within 180 days after 
     the date on which the petition is received; but
       ``(ii) may extend that period for up to 60 additional days 
     to provide for public notice and opportunity for comment and 
     for consideration of the comments submitted.
       ``(D) Termination of waivers.--A waiver granted under 
     subparagraph (A) shall terminate on the earlier of--
       ``(i) the date on which the Administrator, in consultation 
     with the Secretary of Agriculture and the Secretary of 
     Energy, determines that the reason for the waiver no longer 
     exists; or
       ``(ii) the date that is 1 year after the date on which the 
     waiver is granted.
       ``(3) Reports to congress.--Not less often than every 3 
     years, the Administrator shall--
       ``(A) in consultation with the Secretary of Agriculture, 
     submit to Congress a report that describes--
       ``(i) the impact of implementation of this subsection on--

       ``(I) the demand for farm commodities, biomass, and other 
     materials used for producing fuel derived from a renewable 
     source; and
       ``(II) the adequacy of food and feed supplies; and

       ``(ii) the effect of implementation of this subsection on 
     farm income, employment, and economic growth, particularly in 
     rural areas; and
       ``(B) in consultation with the Secretary of Energy, submit 
     to Congress a report that--
       ``(i) describes greenhouse gas emission reductions that 
     result from implementation of this subsection; and
       ``(ii) assesses the effect of implementation of this 
     subsection on United States energy security and reliance on 
     imported petroleum.''.
       (b) Penalties and Enforcement.--Section 211(d) of the Clean 
     Air Act (42 U.S.C. 7545(d)) is amended--
       (1) in paragraph (1)--
       (A) in the first sentence, by striking ``or (n)'' each 
     place it appears and inserting ``(n), or (o)''; and
       (B) in the second sentence, by striking ``or (m)'' and 
     inserting ``(m), or (o)''; and
       (2) in the first sentence of paragraph (2), by striking 
     ``and (n)'' each place it appears and inserting ``(n), and 
     (o)''.

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