[Congressional Record (Bound Edition), Volume 151 (2005), Part 13]
[House]
[Pages 17793-17943]
[From the U.S. Government Publishing Office, www.gpo.gov]




         CONFERENCE REPORT ON H.R. 6, ENERGY POLICY ACT OF 2005

  Mr. BARTON of Texas (during consideration of H.R. 383) submitted the 
following conference report and statement on the bill (H.R. 6), an act 
to ensure jobs for our future with secure, affordable, and reliable 
energy.

                  Conference Report (H. Rept. 109-190)

       The committee of conference on the disagreeing votes of the 
     two Houses on the amendment of the Senate to the bill (H.R. 
     6), to ensure jobs for our future with secure, affordable, 
     and reliable energy, having met, after full and free 
     conference, have agreed to recommend and do recommend to 
     their respective Houses as follows:
       That the House recede from its disagreement to the 
     amendment of the Senate and agree to the same with an 
     amendment as follows:
       In lieu of the matter proposed to be inserted by the Senate 
     amendment, insert the following:

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Energy 
     Policy Act of 2005''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

                       TITLE I--ENERGY EFFICIENCY

                      Subtitle A--Federal Programs

Sec. 101. Energy and water saving measures in congressional buildings.
Sec. 102. Energy management requirements.
Sec. 103. Energy use measurement and accountability.
Sec. 104. Procurement of energy efficient products.
Sec. 105. Energy savings performance contracts.
Sec. 106. Voluntary commitments to reduce industrial energy intensity.
Sec. 107. Advanced Building Efficiency Testbed.
Sec. 108. Increased use of recovered mineral component in federally 
              funded projects involving procurement of cement or 
              concrete.
Sec. 109. Federal building performance standards.
Sec. 110. Daylight savings.
Sec. 111. Enhancing energy efficiency in management of Federal lands.

            Subtitle B--Energy Assistance and State Programs

Sec. 121. Low income home energy assistance program.
Sec. 122. Weatherization assistance.
Sec. 123. State energy programs.
Sec. 124. Energy efficient appliance rebate programs.
Sec. 125. Energy efficient public buildings.
Sec. 126. Low income community energy efficiency pilot program.
Sec. 127. State Technologies Advancement Collaborative.
Sec. 128. State building energy efficiency codes incentives.

                 Subtitle C--Energy Efficient Products

Sec. 131. Energy Star program.
Sec. 132. HVAC maintenance consumer education program.
Sec. 133. Public energy education program.
Sec. 134. Energy efficiency public information initiative.
Sec. 135. Energy conservation standards for additional products.
Sec. 136. Energy conservation standards for commercial equipment.
Sec. 137. Energy labeling.
Sec. 138. Intermittent escalator study.
Sec. 139. Energy efficient electric and natural gas utilities study.
Sec. 140. Energy efficiency pilot program.
Sec. 141. Report on failure to comply with deadlines for new or revised 
              energy conservation standards.

                       Subtitle D--Public Housing

Sec. 151. Public housing capital fund.
Sec. 152. Energy-efficient appliances.
Sec. 153. Energy efficiency standards.
Sec. 154. Energy strategy for HUD.

                       TITLE II--RENEWABLE ENERGY

                     Subtitle A--General Provisions

Sec. 201. Assessment of renewable energy resources.
Sec. 202. Renewable energy production incentive.
Sec. 203. Federal purchase requirement.
Sec. 204. Use of photovoltaic energy in public buildings.
Sec. 205. Biobased products.
Sec. 206. Renewable energy security.
Sec. 207. Installation of photovoltaic system.
Sec. 208. Sugar cane ethanol program.
Sec. 209. Rural and remote community electrification grants.
Sec. 210. Grants to improve the commercial value of forest biomass for 
              electric energy, useful heat, transportation fuels, and 
              other commercial purposes.
Sec. 211. Sense of Congress regarding generation capacity of 
              electricity from renewable energy resources on public 
              lands.

                     Subtitle B--Geothermal Energy

Sec. 221. Short title.
Sec. 222. Competitive lease sale requirements.
Sec. 223. Direct use.
Sec. 224. Royalties and near-term production incentives.
Sec. 225. Coordination of geothermal leasing and permitting on Federal 
              lands.
Sec. 226. Assessment of geothermal energy potential.
Sec. 227. Cooperative or unit plans.
Sec. 228. Royalty on byproducts.
Sec. 229. Authorities of Secretary to readjust terms, conditions, 
              rentals, and royalties.
Sec. 230. Crediting of rental toward royalty.
Sec. 231. Lease duration and work commitment requirements.
Sec. 232. Advanced royalties required for cessation of production.
Sec. 233. Annual rental.
Sec. 234. Deposit and use of geothermal lease revenues for 5 fiscal 
              years.
Sec. 235. Acreage limitations.
Sec. 236. Technical amendments.
Sec. 237. Intermountain West Geothermal Consortium.

                       Subtitle C--Hydroelectric

Sec. 241. Alternative conditions and fishways.
Sec. 242. Hydroelectric production incentives.
Sec. 243. Hydroelectric efficiency improvement.
Sec. 244. Alaska State jurisdiction over small hydroelectric projects.
Sec. 245. Flint Creek hydroelectric project.
Sec. 246. Small hydroelectric power projects.

                       Subtitle D--Insular Energy

Sec. 251. Insular areas energy security.
Sec. 252. Projects enhancing insular energy independence.

                         TITLE III--OIL AND GAS

           Subtitle A--Petroleum Reserve and Home Heating Oil

Sec. 301. Permanent authority to operate the Strategic Petroleum 
              Reserve and other energy programs.

[[Page 17794]]

Sec. 302. National Oilheat Research Alliance.
Sec. 303. Site selection.

                        Subtitle B--Natural Gas

Sec. 311. Exportation or importation of natural gas.
Sec. 312. New natural gas storage facilities.
Sec. 313. Process coordination; hearings; rules of procedure.
Sec. 314. Penalties.
Sec. 315. Market manipulation.
Sec. 316. Natural gas market transparency rules.
Sec. 317. Federal-State liquefied natural gas forums.
Sec. 318. Prohibition of trading and serving by certain individuals.

                         Subtitle C--Production

Sec. 321. Outer Continental Shelf provisions.
Sec. 322. Hydraulic fracturing.
Sec. 323. Oil and gas exploration and production defined.

                  Subtitle D--Naval Petroleum Reserve

Sec. 331. Transfer of administrative jurisdiction and environmental 
              remediation, Naval Petroleum Reserve Numbered 2, Kern 
              County, California.
Sec. 332. Naval Petroleum Reserve Numbered 2 Lease Revenue Account.
Sec. 333. Land conveyance, portion of Naval Petroleum Reserve Numbered 
              2, to City of Taft, California.
Sec. 334. Revocation of land withdrawal.

                   Subtitle E--Production Incentives

Sec. 341. Definition of Secretary.
Sec. 342. Program on oil and gas royalties in-kind.
Sec. 343. Marginal property production incentives.
Sec. 344. Incentives for natural gas production from deep wells in the 
              shallow waters of the Gulf of Mexico.
Sec. 345. Royalty relief for deep water production.
Sec. 346. Alaska offshore royalty suspension.
Sec. 347. Oil and gas leasing in the National Petroleum Reserve in 
              Alaska.
Sec. 348. North Slope Science Initiative.
Sec. 349. Orphaned, abandoned, or idled wells on Federal land.
Sec. 350. Combined hydrocarbon leasing.
Sec. 351. Preservation of geological and geophysical data.
Sec. 352. Oil and gas lease acreage limitations.
Sec. 353. Gas hydrate production incentive.
Sec. 354. Enhanced oil and natural gas production through carbon 
              dioxide injection.
Sec. 355. Assessment of dependence of State of Hawaii on oil.
Sec. 356. Denali Commission.
Sec. 357. Comprehensive inventory of OCS oil and natural gas resources.

                  Subtitle F--Access to Federal Lands

Sec. 361. Federal onshore oil and gas leasing and permitting practices.
Sec. 362. Management of Federal oil and gas leasing programs.
Sec. 363. Consultation regarding oil and gas leasing on public land.
Sec. 364. Estimates of oil and gas resources underlying onshore Federal 
              land.
Sec. 365. Pilot project to improve Federal permit coordination.
Sec. 366. Deadline for consideration of applications for permits.
Sec. 367. Fair market value determinations for linear rights-of-way 
              across public lands and National Forests.
Sec. 368. Energy right-of-way corridors on Federal land.
Sec. 369. Oil shale, tar sands, and other strategic unconventional 
              fuels.
Sec. 370. Finger Lakes withdrawal.
Sec. 371. Reinstatement of leases.
Sec. 372. Consultation regarding energy rights-of-way on public land.
Sec. 373. Sense of Congress regarding development of minerals under 
              Padre Island National Seashore.
Sec. 374. Livingston Parish mineral rights transfer.

                       Subtitle G--Miscellaneous

Sec. 381. Deadline for decision on appeals of consistency determination 
              under the Coastal Zone Management Act of 1972.
Sec. 382. Appeals relating to offshore mineral development.
Sec. 383. Royalty payments under leases under the Outer Continental 
              Shelf Lands Act.
Sec. 384. Coastal impact assistance program.
Sec. 385. Study of availability of skilled workers.
Sec. 386. Great Lakes oil and gas drilling ban.
Sec. 387. Federal coalbed methane regulation.
Sec. 388. Alternate energy-related uses on the outer Continental Shelf.
Sec. 389. Oil Spill Recovery Institute.
Sec. 390. NEPA review.

                  Subtitle H--Refinery Revitalization

Sec. 391. Findings and definitions.
Sec. 392. Federal-State regulatory coordination and assistance.

                             TITLE IV--COAL

                Subtitle A--Clean Coal Power Initiative

Sec. 401. Authorization of appropriations.
Sec. 402. Project criteria.
Sec. 403. Report.
Sec. 404. Clean coal centers of excellence.

                    Subtitle B--Clean Power Projects

Sec. 411. Integrated coal/renewable energy system.
Sec. 412. Loan to place Alaska clean coal technology facility in 
              service.
Sec. 413. Western integrated coal gasification demonstration project.
Sec. 414. Coal gasification.
Sec. 415. Petroleum coke gasification.
Sec. 416. Electron scrubbing demonstration.
Sec. 417. Department of Energy transportation fuels from Illinois basin 
              coal.

                 Subtitle C--Coal and Related Programs

Sec. 421. Amendment of the Energy Policy Act of 1992.

                    Subtitle D--Federal Coal Leases

Sec. 431. Short title.
Sec. 432. Repeal of the 160-acre limitation for coal leases.
Sec. 433. Approval of logical mining units.
Sec. 434. Payment of advance royalties under coal leases.
Sec. 435. Elimination of deadline for submission of coal lease 
              operation and reclamation plan.
Sec. 436. Amendment relating to financial assurances with respect to 
              bonus bids.
Sec. 437. Inventory requirement.
Sec. 438. Application of amendments.

                         TITLE V--INDIAN ENERGY

Sec. 501. Short title.
Sec. 502. Office of Indian Energy Policy and Programs.
Sec. 503. Indian energy.
Sec. 504. Consultation with Indian tribes.
Sec. 505. Four Corners transmission line project and electrification.
Sec. 506. Energy efficiency in federally assisted housing.

                       TITLE VI--NUCLEAR MATTERS

               Subtitle A--Price-Anderson Act Amendments

Sec. 601. Short title.
Sec. 602. Extension of indemnification authority.
Sec. 603. Maximum assessment.
Sec. 604. Department liability limit.
Sec. 605. Incidents outside the United States.
Sec. 606. Reports.
Sec. 607. Inflation adjustment.
Sec. 608. Treatment of modular reactors.
Sec. 609. Applicability.
Sec. 610. Civil penalties.

                  Subtitle B--General Nuclear Matters

Sec. 621. Licenses.
Sec. 622. Nuclear Regulatory Commission scholarship and fellowship 
              program.
Sec. 623. Cost recovery from Government agencies.
Sec. 624. Elimination of pension offset for certain rehired Federal 
              retirees.
Sec. 625. Antitrust review.
Sec. 626. Decommissioning.
Sec. 627. Limitation on legal fee reimbursement.
Sec. 628. Decommissioning pilot program.
Sec. 629. Whistleblower protection.
Sec. 630. Medical isotope production.
Sec. 631. Safe disposal of greater-than-Class C radioactive waste.
Sec. 632. Prohibition on nuclear exports to countries that sponsor 
              terrorism.
Sec. 633. Employee benefits.
Sec. 634. Demonstration hydrogen production at existing nuclear power 
              plants.
Sec. 635. Prohibition on assumption by United States Government of 
              liability for certain foreign incidents.
Sec. 636. Authorization of appropriations.
Sec. 637. Nuclear Regulatory Commission user fees and annual charges.
Sec. 638. Standby support for certain nuclear plant delays.
Sec. 639. Conflicts of interest relating to contracts and other 
              arrangements.

           Subtitle C--Next Generation Nuclear Plant Project

Sec. 641. Project establishment.
Sec. 642. Project management.
Sec. 643. Project organization.
Sec. 644. Nuclear Regulatory Commission.
Sec. 645. Project timelines and authorization of appropriations.

                      Subtitle D--Nuclear Security

Sec. 651. Nuclear facility and materials security.
Sec. 652. Fingerprinting and criminal history record checks.
Sec. 653. Use of firearms by security personnel.
Sec. 654. Unauthorized introduction of dangerous weapons.
Sec. 655. Sabotage of nuclear facilities, fuel, or designated material.
Sec. 656. Secure transfer of nuclear materials.
Sec. 657. Department of Homeland Security consultation.

                     TITLE VII--VEHICLES AND FUELS

                     Subtitle A--Existing Programs

Sec. 701. Use of alternative fuels by dual fueled vehicles.
Sec. 702. Incremental cost allocation.
Sec. 703. Alternative compliance and flexibility.
Sec. 704. Review of Energy Policy Act of 1992 programs.
Sec. 705. Report concerning compliance with alternative fueled vehicle 
              purchasing requirements.
Sec. 706. Joint flexible fuel/hybrid vehicle commercialization 
              initiative.
Sec. 707. Emergency exemption.

  Subtitle B--Hybrid Vehicles, Advanced Vehicles, and Fuel Cell Buses

                        Part 1--Hybrid Vehicles

Sec. 711. Hybrid vehicles.
Sec. 712. Efficient hybrid and advanced diesel vehicles.

[[Page 17795]]

                       Part 2--Advanced Vehicles

Sec. 721. Pilot program.
Sec. 722. Reports to Congress.
Sec. 723. Authorization of appropriations.

                        Part 3--Fuel Cell Buses

Sec. 731. Fuel cell transit bus demonstration.

                     Subtitle C--Clean School Buses

Sec. 741. Clean school bus program.
Sec. 742. Diesel truck retrofit and fleet modernization program.
Sec. 743. Fuel cell school buses.

                       Subtitle D--Miscellaneous

Sec. 751. Railroad efficiency.
Sec. 752. Mobile emission reductions trading and crediting.
Sec. 753. Aviation fuel conservation and emissions.
Sec. 754. Diesel fueled vehicles.
Sec. 755. Conserve by Bicycling Program.
Sec. 756. Reduction of engine idling.
Sec. 757. Biodiesel engine testing program.
Sec. 758. Ultra-efficient engine technology for aircraft.
Sec. 759. Fuel economy incentive requirements.

                   Subtitle E--Automobile Efficiency

Sec. 771. Authorization of appropriations for implementation and 
              enforcement of fuel economy standards.
Sec. 772. Extension of maximum fuel economy increase for alternative 
              fueled vehicles.
Sec. 773. Study of feasibility and effects of reducing use of fuel for 
              automobiles.
Sec. 774. Update testing procedures.

               Subtitle F--Federal and State Procurement

Sec. 781. Definitions.
Sec. 782. Federal and State procurement of fuel cell vehicles and 
              hydrogen energy systems.
Sec. 783. Federal procurement of stationary, portable, and micro fuel 
              cells.

                 Subtitle G--Diesel Emissions Reduction

Sec. 791. Definitions.
Sec. 792. National grant and loan programs.
Sec. 793. State grant and loan programs.
Sec. 794. Evaluation and report.
Sec. 795. Outreach and incentives.
Sec. 796. Effect of subtitle.
Sec. 797. Authorization of appropriations.

                          TITLE VIII--HYDROGEN

Sec. 801. Hydrogen and fuel cell program.
Sec. 802. Purposes.
Sec. 803. Definitions.
Sec. 804. Plan.
Sec. 805. Programs.
Sec. 806. Hydrogen and Fuel Cell Technical Task Force.
Sec. 807. Technical Advisory Committee.
Sec. 808. Demonstration.
Sec. 809. Codes and standards.
Sec. 810. Disclosure.
Sec. 811. Reports.
Sec. 812. Solar and wind technologies.
Sec. 813. Technology transfer.
Sec. 814. Miscellaneous provisions.
Sec. 815. Cost sharing.
Sec. 816. Savings clause.

                   TITLE IX--RESEARCH AND DEVELOPMENT

Sec. 901. Short title.
Sec. 902. Goals.
Sec. 903. Definitions.

                     Subtitle A--Energy Efficiency

Sec. 911. Energy efficiency.
Sec. 912. Next Generation Lighting Initiative.
Sec. 913. National Building Performance Initiative.
Sec. 914. Building standards.
Sec. 915. Secondary electric vehicle battery use program.
Sec. 916. Energy Efficiency Science Initiative.
Sec. 917. Advanced Energy Efficiency Technology Transfer Centers.

       Subtitle B--Distributed Energy and Electric Energy Systems

Sec. 921. Distributed energy and electric energy systems.
Sec. 922. High power density industry program.
Sec. 923. Micro-cogeneration energy technology.
Sec. 924. Distributed energy technology demonstration programs.
Sec. 925. Electric transmission and distribution programs.

                      Subtitle C--Renewable Energy

Sec. 931. Renewable energy.
Sec. 932. Bioenergy program.
Sec. 933. Low-cost renewable hydrogen and infrastructure for vehicle 
              propulsion.
Sec. 934. Concentrating solar power research program.
Sec. 935. Renewable energy in public buildings.

   Subtitle D--Agricultural Biomass Research and Development Programs

Sec. 941. Amendments to the Biomass Research and Development Act of 
              2000.
Sec. 942. Production incentives for cellulosic biofuels.
Sec. 943. Procurement of biobased products.
Sec. 944. Small business bioproduct marketing and certification grants.
Sec. 945. Regional bioeconomy development grants.
Sec. 946. Preprocessing and harvesting demonstration grants.
Sec. 947. Education and outreach.
Sec. 948. Reports.

                       Subtitle E--Nuclear Energy

Sec. 951. Nuclear energy.
Sec. 952. Nuclear energy research programs.
Sec. 953. Advanced fuel cycle initiative.
Sec. 954. University nuclear science and engineering support.
Sec. 955. Department of Energy civilian nuclear infrastructure and 
              facilities.
Sec. 956. Security of nuclear facilities.
Sec. 957. Alternatives to industrial radioactive sources.

                       Subtitle F--Fossil Energy

Sec. 961. Fossil energy.
Sec. 962. Coal and related technologies program.
Sec. 963. Carbon capture research and development program.
Sec. 964. Research and development for coal mining technologies.
Sec. 965. Oil and gas research programs.
Sec. 966. Low-volume oil and gas reservoir research program.
Sec. 967. Complex well technology testing facility.
Sec. 968. Methane hydrate research.

                          Subtitle G--Science

Sec. 971. Science.
Sec. 972. Fusion energy sciences program.
Sec. 973. Catalysis research program.
Sec. 974. Hydrogen.
Sec. 975. Solid state lighting.
Sec. 976. Advanced scientific computing for energy missions.
Sec. 977. Systems biology program.
Sec. 978. Fission and fusion energy materials research program.
Sec. 979. Energy and water supplies.
Sec. 980. Spallation Neutron Source.
Sec. 981. Rare isotope accelerator.
Sec. 982. Office of Scientific and Technical Information.
Sec. 983. Science and engineering education pilot program.
Sec. 984. Energy research fellowships.
Sec. 984A. Science and technology scholarship program.

                 Subtitle H--International Cooperation

Sec. 985. Western Hemisphere energy cooperation.
Sec. 986. Cooperation between United States and Israel.
Sec. 986A. International energy training.

           Subtitle I--Research Administration and Operations

Sec. 987. Availability of funds.
Sec. 988. Cost sharing.
Sec. 989. Merit review of proposals.
Sec. 990. External technical review of Departmental programs.
Sec. 991. National Laboratory designation.
Sec. 992. Report on equal employment opportunity practices.
Sec. 993. Strategy and plan for science and energy facilities and 
              infrastructure.
Sec. 994. Strategic research portfolio analysis and coordination plan.
Sec. 995. Competitive award of management contracts.
Sec. 996. Western Michigan demonstration project.
Sec. 997. Arctic Engineering Research Center.
Sec. 998. Barrow Geophysical Research Facility.

 Subtitle J--Ultra-Deepwater and Unconventional Natural Gas and Other 
                          Petroleum Resources

Sec. 999A. Program authority.
Sec. 999B. Ultra-deepwater and unconventional onshore natural gas and 
              other petroleum research and development program.
Sec. 999C. Additional requirements for awards.
Sec. 999D. Advisory committees.
Sec. 999E. Limits on participation.
Sec. 999F. Sunset.
Sec. 999G. Definitions.
Sec. 999H. Funding.

                TITLE X--DEPARTMENT OF ENERGY MANAGEMENT

Sec. 1001. Improved technology transfer of energy technologies.
Sec. 1002. Technology Infrastructure Program.
Sec. 1003. Small business advocacy and assistance.
Sec. 1004. Outreach.
Sec. 1005. Relationship to other laws.
Sec. 1006. Improved coordination and management of civilian science and 
              technology programs.
Sec. 1007. Other transactions authority.
Sec. 1008. Prizes for achievement in grand challenges of science and 
              technology.
Sec. 1009. Technical corrections.
Sec. 1010. University collaboration.
Sec. 1011. Sense of Congress.

                    TITLE XI--PERSONNEL AND TRAINING

Sec. 1101. Workforce trends and traineeship grants.
Sec. 1102. Educational programs in science and mathematics.
Sec. 1103. Training guidelines for nonnuclear electric energy industry 
              personnel.
Sec. 1104. National Center for Energy Management and Building 
              Technologies.
Sec. 1105. Improved access to energy-related scientific and technical 
              careers.
Sec. 1106. National Power Plant Operations Technology and Educational 
              Center.

                         TITLE XII--ELECTRICITY

Sec. 1201. Short title.

                   Subtitle A--Reliability Standards

Sec. 1211. Electric reliability standards.

         Subtitle B--Transmission Infrastructure Modernization

Sec. 1221. Siting of interstate electric transmission facilities.

[[Page 17796]]

Sec. 1222. Third-party finance.
Sec. 1223. Advanced transmission technologies.
Sec. 1224. Advanced Power System Technology Incentive Program.

            Subtitle C--Transmission Operation Improvements

Sec. 1231. Open nondiscriminatory access.
Sec. 1232. Federal utility participation in Transmission Organizations.
Sec. 1233. Native load service obligation.
Sec. 1234. Study on the benefits of economic dispatch.
Sec. 1235. Protection of transmission contracts in the Pacific 
              Northwest.
Sec. 1236. Sense of Congress regarding locational installed capacity 
              mechanism.

                  Subtitle D--Transmission Rate Reform

Sec. 1241. Transmission infrastructure investment.
Sec. 1242. Funding new interconnection and transmission upgrades.

                    Subtitle E--Amendments to PURPA

Sec. 1251. Net metering and additional standards.
Sec. 1252. Smart metering.
Sec. 1253. Cogeneration and small power production purchase and sale 
              requirements.
Sec. 1254. Interconnection.

                      Subtitle F--Repeal of PUHCA

Sec. 1261. Short title.
Sec. 1262. Definitions.
Sec. 1263. Repeal of the Public Utility Holding Company Act of 1935.
Sec. 1264. Federal access to books and records.
Sec. 1265. State access to books and records.
Sec. 1266. Exemption authority.
Sec. 1267. Affiliate transactions.
Sec. 1268. Applicability.
Sec. 1269. Effect on other regulations.
Sec. 1270. Enforcement.
Sec. 1271. Savings provisions.
Sec. 1272. Implementation.
Sec. 1273. Transfer of resources.
Sec. 1274. Effective date.
Sec. 1275. Service allocation.
Sec. 1276. Authorization of appropriations.
Sec. 1277. Conforming amendments to the Federal Power Act.

 Subtitle G--Market Transparency, Enforcement, and Consumer Protection

Sec. 1281. Electricity market transparency.
Sec. 1282. False statements.
Sec. 1283. Market manipulation.
Sec. 1284. Enforcement.
Sec. 1285. Refund effective date.
Sec. 1286. Refund authority.
Sec. 1287. Consumer privacy and unfair trade practices.
Sec. 1288. Authority of court to prohibit individuals from serving as 
              officers, directors, and energy traders.
Sec. 1289. Merger review reform.
Sec. 1290. Relief for extraordinary violations.

                        Subtitle H--Definitions

Sec. 1291. Definitions.

            Subtitle I--Technical and Conforming Amendments

Sec. 1295. Conforming amendments.

                     Subtitle J--Economic Dispatch

Sec. 1298. Economic dispatch.

                TITLE XIII--ENERGY POLICY TAX INCENTIVES

Sec. 1300. Short title; amendment to 1986 code.

                 Subtitle A--Electricity Infrastructure

Sec. 1301. Extension and modification of renewable electricity 
              production credit.
Sec. 1302. Application of section 45 credit to agricultural 
              cooperatives.
Sec. 1303. Clean renewable energy bonds.
Sec. 1304. Treatment of income of certain electric cooperatives.
Sec. 1305. Dispositions of transmission property to implement FERC 
              restructuring policy.
Sec. 1306. Credit for production from advanced nuclear power 
              facilities.
Sec. 1307. Credit for investment in clean coal facilities.
Sec. 1308. Electric transmission property treated as 15-year property.
Sec. 1309. Expansion of amortization for certain atmospheric pollution 
              control facilities in connection with plants first placed 
              in service after 1975.
Sec. 1310. Modifications to special rules for nuclear decommissioning 
              costs.
Sec. 1311. 5-year net operating loss carryover for certain losses.

               Subtitle B--Domestic Fossil Fuel Security

Sec. 1321. Extension of credit for producing fuel from a 
              nonconventional source for facilities producing coke or 
              coke gas.
Sec. 1322. Modification of credit for producing fuel from a 
              nonconventional source.
Sec. 1323. Temporary expensing for equipment used in refining of liquid 
              fuels.
Sec. 1324. Pass through to owners of deduction for capital costs 
              incurred by small refiner cooperatives in complying with 
              Environmental Protection Agency sulfur regulations.
Sec. 1325. Natural gas distribution lines treated as 15-year property.
Sec. 1326. Natural gas gathering lines treated as 7-year property.
Sec. 1327. Arbitrage rules not to apply to prepayments for natural gas.
Sec. 1328. Determination of small refiner exception to oil depletion 
              deduction.
Sec. 1329. Amortization of geological and geophysical expenditures.

       Subtitle C--Conservation and Energy Efficiency Provisions

Sec. 1331. Energy efficient commercial buildings deduction.
Sec. 1332. Credit for construction of new energy efficient homes.
Sec. 1333. Credit for certain nonbusiness energy property.
Sec. 1334. Credit for energy efficient appliances.
Sec. 1335. Credit for residential energy efficient property.
Sec. 1336. Credit for business installation of qualified fuel cells and 
              stationary microturbine power plants.
Sec. 1337. Business solar investment tax credit.

      Subtitle D--Alternative Motor Vehicles and Fuels Incentives

Sec. 1341. Alternative motor vehicle credit.
Sec. 1342. Credit for installation of alternative fueling stations.
Sec. 1343. Reduced motor fuel excise tax on certain mixtures of diesel 
              fuel.
Sec. 1344. Extension of excise tax provisions and income tax credit for 
              biodiesel.
Sec. 1345. Small agri-biodiesel producer credit.
Sec. 1346. Renewable diesel.
Sec. 1347. Modification.of small ethanol producer credit.
Sec. 1348. Sunset of deduction for clean-fuel vehicles and certain 
              refueling property.

              Subtitle E--Additional Energy Tax Incentives

Sec. 1351. Expansion of research credit.
Sec. 1352. National Academy of Sciences study and report.
Sec. 1353. Recycling study.

                 Subtitle F--Revenue Raising Provisions

Sec. 1361. Oil Spill Liability Trust Fund financing rate.
Sec. 1362. Extension of Leaking Underground Storage Tank Trust Fund 
              financing rate.
Sec. 1363. Modification of recapture rules for amortizable section 197 
              intangibles.
Sec. 1364. Clarification of tire excise tax.

                        TITLE XIV--MISCELLANEOUS

                         Subtitle A--In General

Sec. 1401. Sense of Congress on risk assessments.
Sec. 1402. Energy production incentives.
Sec. 1403. Regulation of certain oil used in transformers.
Sec. 1404. Petrochemical and oil refinery facility health assessment.
Sec. 1405. National Priority Project Designation.
Sec. 1406. Cold cracking.
Sec. 1407. Oxygen-fuel.

                      Subtitle B--Set America Free

Sec. 1421. Short title.
Sec. 1422. Purpose.
Sec. 1423. United States Commission on North American Energy Freedom.
Sec. 1424. North American energy freedom policy.

                   TITLE XV--ETHANOL AND MOTOR FUELS

                     Subtitle A--General Provisions

Sec. 1501. Renewable content of gasoline.
Sec. 1502. Findings.
Sec. 1503. Claims filed after enactment.
Sec. 1504. Elimination of oxygen content requirement for reformulated 
              gasoline.
Sec. 1505. Public health and environmental impacts of fuels and fuel 
              additives.
Sec. 1506. Analyses of motor vehicle fuel changes.
Sec. 1507. Additional opt-in areas under reformulated gasoline program.
Sec. 1508. Data collection.
Sec. 1509. Fuel system requirements harmonization study.
Sec. 1510. Commercial byproducts from municipal solid waste and 
              cellulosic biomass loan guarantee program.
Sec. 1511. Renewable fuel.
Sec. 1512. Conversion assistance for cellulosic biomass, waste-derived 
              ethanol, approved renewable fuels.
Sec. 1513. Blending of compliant reformulated gasolines.
Sec. 1514. Advanced biofuel technologies program.
Sec. 1515. Waste-derived ethanol and biodiesel.
Sec. 1516. Sugar ethanol loan guarantee program.

            Subtitle B--Underground Storage Tank Compliance

Sec. 1521. Short title.
Sec. 1522. Leaking underground storage tanks.
Sec. 1523. Inspection of underground storage tanks.
Sec. 1524. Operator training.
Sec. 1525. Remediation from oxygenated fuel additives.
Sec. 1526. Release prevention, compliance, and enforcement.
Sec. 1527. Delivery prohibition.
Sec. 1528. Federal facilities.
Sec. 1529. Tanks on tribal lands.
Sec. 1530. Additional measures to protect groundwater.
Sec. 1531. Authorization of appropriations.
Sec. 1532. Conforming amendments.
Sec. 1533. Technical amendments.

                       Subtitle C--Boutique Fuels

Sec. 1541. Reducing the proliferation of boutique fuels.

[[Page 17797]]

                       TITLE XVI--CLIMATE CHANGE

       Subtitle A--National Climate Change Technology Deployment

Sec. 1601. Greenhouse gas intensity reducing technology strategies.

    Subtitle B--Climate Change Technology Deployment in Developing 
                               Countries

Sec. 1611. Climate change technology deployment in developing 
              countries.

           TITLE XVII--INCENTIVES FOR INNOVATIVE TECHNOLOGIES

Sec. 1701. Definitions.
Sec. 1702. Terms and conditions.
Sec. 1703. Eligible projects.
Sec. 1704. Authorization of appropriations.

                          TITLE XVIII--STUDIES

Sec. 1801. Study on inventory of petroleum and natural gas storage.
Sec. 1802. Study of energy efficiency standards.
Sec. 1803. Telecommuting study.
Sec. 1804. LIHEAP Report.
Sec. 1805. Oil bypass filtration technology.
Sec. 1806. Total integrated thermal systems.
Sec. 1807. Report on energy integration with Latin America.
Sec. 1808. Low-volume gas reservoir study.
Sec. 1809. Investigation of gasoline prices.
Sec. 1810. Alaska natural gas pipeline.
Sec. 1811. Coal bed methane study.
Sec. 1812. Backup fuel capability study.
Sec. 1813. Indian land rights-of-way.
Sec. 1814. Mobility of scientific and technical personnel.
Sec. 1815. Interagency review of competition in the wholesale and 
              retail markets for electric energy.
Sec. 1816. Study of rapid electrical grid restoration.
Sec. 1817. Study of distributed generation.
Sec. 1818. Natural gas supply shortage report.
Sec. 1819. Hydrogen participation study.
Sec. 1820. Overall employment in a hydrogen economy.
Sec. 1821. Study of best management practices for energy research and 
              development programs.
Sec. 1822. Effect of electrical contaminants on reliability of energy 
              production systems.
Sec. 1823. Alternative fuels reports.
Sec. 1824. Final action on refunds for excessive charges.
Sec. 1825. Fuel cell and hydrogen technology study.
Sec. 1826. Passive solar technologies.
Sec. 1827. Study of link between energy security and increases in 
              vehicle miles traveled.
Sec. 1828. Science study on cumulative impacts of multiple offshore 
              liquefied natural gas facilities.
Sec. 1829. Energy and water saving measures in congressional buildings.
Sec. 1830. Study of availability of skilled workers.
Sec. 1831. Review of Energy Policy Act of 1992 programs.
Sec. 1832. Study on the benefits of economic dispatch.
Sec. 1833. Renewable energy on Federal land.
Sec. 1834. Increased hydroelectric generation at existing Federal 
              facilities.
Sec. 1835. Split-estate Federal oil and gas leasing and development 
              practices.
Sec. 1836. Resolution of Federal resource development conflicts in the 
              Powder River Basin.
Sec. 1837. National security review of international energy 
              requirements.
Sec. 1838. Used oil re-refining study.
Sec. 1839. Transmission system monitoring.
Sec. 1840. Report identifying and describing the status of potential 
              hydropower facilities.

     SEC. 2. DEFINITIONS.

       Except as otherwise provided, in this Act:
       (1) Department.--The term ``Department'' means the 
     Department of Energy.
       (2) Institution of higher education.--
       (A) In general.--The term ``institution of higher 
     education'' has the meaning given the term in section 101(a) 
     of the Higher Education Act of 1065 (20 U.S.C. 1001(a)).
       (B) Inclusion.--The term ``institution of higher 
     education'' includes an organization that--
       (i) is organized, and at all times thereafter operated, 
     exclusively for the benefit of, to perform the functions of, 
     or to carry out the functions of 1 or more organizations 
     referred to in subparagraph (A); and
       (ii) is operated, supervised, or controlled by or in 
     connection with 1 or more of those organizations.
       (3) National laboratory.--The term ``National Laboratory'' 
     means any of the following laboratories owned by the 
     Department:
       (A) Ames Laboratory.
       (B) Argonne National Laboratory.
       (C) Brookhaven National Laboratory.
       (D) Fermi National Accelerator Laboratory.
       (E) Idaho National Laboratory.
       (F) Lawrence Berkeley National Laboratory.
       (G) Lawrence Livermore National Laboratory.
       (H) Los Alamos National Laboratory.
       (I) National Energy Technology Laboratory.
       (J) National Renewable Energy Laboratory.
       (K) Oak Ridge National Laboratory.
       (L) Pacific Northwest National Laboratory.
       (M) Princeton Plasma Physics Laboratory.
       (N) Sandia National Laboratories.
       (O) Savannah River National Laboratory.
       (P) Stanford Linear Accelerator Center.
       (Q) Thomas Jefferson National Accelerator Facility.
       (4) Secretary.--The term ``Secretary'' means the Secretary 
     of Energy.
       (5) Small business concern.--The term ``small business 
     concern'' has the meaning given the term in section 3 of the 
     Small Business Act (15 U.S.C. 632).
                       TITLE I--ENERGY EFFICIENCY
                      Subtitle A--Federal Programs

     SEC. 101. ENERGY AND WATER SAVING MEASURES IN CONGRESSIONAL 
                   BUILDINGS.

       (a) In General.--Part 3 of title V of the National Energy 
     Conservation Policy Act (42 U.S.C. 8251 et seq.) is amended 
     by adding at the end the following:

     ``SEC. 552. ENERGY AND WATER SAVINGS MEASURES IN 
                   CONGRESSIONAL BUILDINGS.

       ``(a) In General.--The Architect of the Capitol--
       ``(1) shall develop, update, and implement a cost-effective 
     energy conservation and management plan (referred to in this 
     section as the `plan') for all facilities administered by 
     Congress (referred to in this section as `congressional 
     buildings') to meet the energy performance requirements for 
     Federal buildings established under section 543(a)(1); and
       ``(2) shall submit the plan to Congress, not later than 180 
     days after the date of enactment of this section.
       ``(b) Plan Requirements.--The plan shall include--
       ``(1) a description of the life cycle cost analysis used to 
     determine the cost-effectiveness of proposed energy 
     efficiency projects;
       ``(2) a schedule of energy surveys to ensure complete 
     surveys of all congressional buildings every 5 years to 
     determine the cost and payback period of energy and water 
     conservation measures;
       ``(3) a strategy for installation of life cycle cost-
     effective energy and water conservation measures;
       ``(4) the results of a study of the costs and benefits of 
     installation of submetering in congressional buildings; and
       ``(5) information packages and `how-to' guides for each 
     Member and employing authority of Congress that detail 
     simple, cost-effective methods to save energy and taxpayer 
     dollars in the workplace.
       ``(c) Annual Report.--The Architect of the Capitol shall 
     submit to Congress annually a report on congressional energy 
     management and conservation programs required under this 
     section that describes in detail--
       ``(1) energy expenditures and savings estimates for each 
     facility;
       ``(2) energy management and conservation projects; and
       ``(3) future priorities to ensure compliance with this 
     section.''.
       (b) Table of Contents Amendment.--The table of contents of 
     the National Energy Conservation Policy Act is amended by 
     adding at the end of the items relating to part 3 of title V 
     the following new item:

``Sec. 552. Energy and water savings measures in congressional 
              buildings''.

       (c) Repeal.--Section 310 of the Legislative Branch 
     Appropriations Act, 1999 (2 U.S.C. 1815), is repealed.

     SEC. 102. ENERGY MANAGEMENT REQUIREMENTS.

       (a) Energy Reduction Goals.--
       (1) Amendment.--Section 543(a)(1) of the National Energy 
     Conservation Policy Act (42 U.S.C. 8253(a)(1)) is amended by 
     striking ``its Federal buildings so that'' and all that 
     follows through the end and inserting ``the Federal buildings 
     of the agency (including each industrial or laboratory 
     facility) so that the energy consumption per gross square 
     foot of the Federal buildings of the agency in fiscal years 
     2006 through 2015 is reduced, as compared with the energy 
     consumption per gross square foot of the Federal buildings of 
     the agency in fiscal year 2003, by the percentage specified 
     in the following table:

  ``Fiscal Year                                    Percentage reduction
    2006............................................................ 2 
    2007............................................................ 4 
    2008............................................................ 6 
    2009............................................................ 8 
    2010............................................................10 
    2011............................................................12 
    2012............................................................14 
    2013............................................................16 
    2014............................................................18 
    2015..........................................................20.''

       (2) Reporting baseline.--The energy reduction goals and 
     baseline established in paragraph (1) of section 543(a) of 
     the National Energy Conservation Policy Act (42 U.S.C. 
     8253(a)(1)), as amended by this subsection, supersede all 
     previous goals and baselines under such paragraph, and 
     related reporting requirements.
       (b) Review and Revision of Energy Performance 
     Requirement.--Section 543(a) of the National Energy 
     Conservation Policy Act (42 U.S.C. 8253(a)) is further 
     amended by adding at the end the following:
       ``(3) Not later than December 31, 2014, the Secretary shall 
     review the results of the implementation of the energy 
     performance requirement established under paragraph (1) and 
     submit to Congress recommendations concerning energy 
     performance requirements for fiscal years 2016 through 
     2025.''.
       (c) Exclusions.--Section 543(c)(1) of the National Energy 
     Conservation Policy Act (42 U.S.C. 8253(c)(1)) is amended by 
     striking ``An agency may exclude'' and all that follows 
     through the end and inserting ``(A) An agency may exclude, 
     from the energy performance requirement for a fiscal year 
     established under

[[Page 17798]]

     subsection (a) and the energy management requirement 
     established under subsection (b), any Federal building or 
     collection of Federal buildings, if the head of the agency 
     finds that--
       ``(i) compliance with those requirements would be 
     impracticable;
       ``(ii) the agency has completed and submitted all federally 
     required energy management reports;
       ``(iii) the agency has achieved compliance with the energy 
     efficiency requirements of this Act, the Energy Policy Act of 
     1992, Executive orders, and other Federal law; and
       ``(iv) the agency has implemented all practicable, life 
     cycle cost-effective projects with respect to the Federal 
     building or collection of Federal buildings to be excluded.
       ``(B) A finding of impracticability under subparagraph 
     (A)(i) shall be based on--
       ``(i) the energy intensiveness of activities carried out in 
     the Federal building or collection of Federal buildings; or
       ``(ii) the fact that the Federal building or collection of 
     Federal buildings is used in the performance of a national 
     security function.''.
       (d) Review by Secretary.--Section 543(c)(2) of the National 
     Energy Conservation Policy Act (42 U.S.C. 8253(c)(2)) is 
     amended--
       (1) by striking ``impracticability standards'' and 
     inserting ``standards for exclusion'';
       (2) by striking ``a finding of impracticability'' and 
     inserting ``the exclusion''; and
       (3) by striking ``energy consumption requirements'' and 
     inserting ``requirements of subsections (a) and (b)(1)''.
       (e) Criteria.--Section 543(c) of the National Energy 
     Conservation Policy Act (42 U.S.C. 8253(c)) is further 
     amended by adding at the end the following:
       ``(3) Not later than 180 days after the date of enactment 
     of this paragraph, the Secretary shall issue guidelines that 
     establish criteria for exclusions under paragraph (1).''.
       (f) Retention of Energy and Water Savings.--Section 546 of 
     the National Energy Conservation Policy Act (42 U.S.C. 8256) 
     is amended by adding at the end the following new subsection:
       ``(e) Retention of Energy and Water Savings.--An agency may 
     retain any funds appropriated to that agency for energy 
     expenditures, water expenditures, or wastewater treatment 
     expenditures, at buildings subject to the requirements of 
     section 543(a) and (b), that are not made because of energy 
     savings or water savings. Except as otherwise provided by 
     law, such funds may be used only for energy efficiency, water 
     conservation, or unconventional and renewable energy 
     resources projects. Such projects shall be subject to the 
     requirements of section 3307 of title 40, United States 
     Code.''.
       (g) Reports.--Section 548(b) of the National Energy 
     Conservation Policy Act (42 U.S.C. 8258(b)) is amended--
       (1) in the subsection heading, by inserting ``the President 
     and'' before ``Congress''; and
       (2) by inserting ``President and'' before ``Congress''.
       (h) Conforming Amendment.--Section 550(d) of the National 
     Energy Conservation Policy Act (42 U.S.C. 8258b(d)) is 
     amended in the second sentence by striking ``the 20 percent 
     reduction goal established under section 543(a) of the 
     National Energy Conservation Policy Act (42 U.S.C. 
     8253(a)).'' and inserting ``each of the energy reduction 
     goals established under section 543(a).''.

     SEC. 103. ENERGY USE MEASUREMENT AND ACCOUNTABILITY.

       Section 543 of the National Energy Conservation Policy Act 
     (42 U.S.C. 8253) is further amended by adding at the end the 
     following:
       ``(e) Metering of Energy Use.--
       ``(1) Deadline.--By October 1, 2012, in accordance with 
     guidelines established by the Secretary under paragraph (2), 
     all Federal buildings shall, for the purposes of efficient 
     use of energy and reduction in the cost of electricity used 
     in such buildings, be metered. Each agency shall use, to the 
     maximum extent practicable, advanced meters or advanced 
     metering devices that provide data at least daily and that 
     measure at least hourly consumption of electricity in the 
     Federal buildings of the agency. Such data shall be 
     incorporated into existing Federal energy tracking systems 
     and made available to Federal facility managers.
       ``(2) Guidelines.--
       ``(A) In general.--Not later than 180 days after the date 
     of enactment of this subsection, the Secretary, in 
     consultation with the Department of Defense, the General 
     Services Administration, representatives from the metering 
     industry, utility industry, energy services industry, energy 
     efficiency industry, energy efficiency advocacy 
     organizations, national laboratories, universities, and 
     Federal facility managers, shall establish guidelines for 
     agencies to carry out paragraph (1).
       ``(B) Requirements for guidelines.--The guidelines shall--
       ``(i) take into consideration--

       ``(I) the cost of metering and the reduced cost of 
     operation and maintenance expected to result from metering;
       ``(II) the extent to which metering is expected to result 
     in increased potential for energy management, increased 
     potential for energy savings and energy efficiency 
     improvement, and cost and energy savings due to utility 
     contract aggregation; and
       ``(III) the measurement and verification protocols of the 
     Department of Energy;

       ``(ii) include recommendations concerning the amount of 
     funds and the number of trained personnel necessary to gather 
     and use the metering information to track and reduce energy 
     use;
       ``(iii) establish priorities for types and locations of 
     buildings to be metered based on cost-effectiveness and a 
     schedule of 1 or more dates, not later than 1 year after the 
     date of issuance of the guidelines, on which the requirements 
     specified in paragraph (1) shall take effect; and
       ``(iv) establish exclusions from the requirements specified 
     in paragraph (1) based on the de minimis quantity of energy 
     use of a Federal building, industrial process, or structure.
       ``(3) Plan.--Not later than 6 months after the date 
     guidelines are established under paragraph (2), in a report 
     submitted by the agency under section 548(a), each agency 
     shall submit to the Secretary a plan describing how the 
     agency will implement the requirements of paragraph (1), 
     including (A) how the agency will designate personnel 
     primarily responsible for achieving the requirements and (B) 
     demonstration by the agency, complete with documentation, of 
     any finding that advanced meters or advanced metering 
     devices, as defined in paragraph (1), are not practicable.''.

     SEC. 104. PROCUREMENT OF ENERGY EFFICIENT PRODUCTS.

       (a) Requirements.--Part 3 of title V of the National Energy 
     Conservation Policy Act (42 U.S.C. 8251 et seq.), as amended 
     by section 101, is amended by adding at the end the 
     following:

     ``SEC. 553. FEDERAL PROCUREMENT OF ENERGY EFFICIENT PRODUCTS.

       ``(a) Definitions.--In this section:
       ``(1) Agency.--The term `agency' has the meaning given that 
     term in section 7902(a) of title 5, United States Code.
       ``(2) Energy star product.--The term `Energy Star product' 
     means a product that is rated for energy efficiency under an 
     Energy Star program.
       ``(3) Energy star program.--The term `Energy Star program' 
     means the program established by section 324A of the Energy 
     Policy and Conservation Act.
       ``(4) FEMP designated product.--The term `FEMP designated 
     product' means a product that is designated under the Federal 
     Energy Management Program of the Department of Energy as 
     being among the highest 25 percent of equivalent products for 
     energy efficiency.
       ``(5) Product.--The term `product' does not include any 
     energy consuming product or system designed or procured for 
     combat or combat-related missions.
       ``(b) Procurement of Energy Efficient Products.--
       ``(1) Requirement.--To meet the requirements of an agency 
     for an energy consuming product, the head of the agency 
     shall, except as provided in paragraph (2), procure--
       ``(A) an Energy Star product; or
       ``(B) a FEMP designated product.
       ``(2) Exceptions.--The head of an agency is not required to 
     procure an Energy Star product or FEMP designated product 
     under paragraph (1) if the head of the agency finds in 
     writing that--
       ``(A) an Energy Star product or FEMP designated product is 
     not cost-effective over the life of the product taking energy 
     cost savings into account; or
       ``(B) no Energy Star product or FEMP designated product is 
     reasonably available that meets the functional requirements 
     of the agency.
       ``(3) Procurement planning.--The head of an agency shall 
     incorporate into the specifications for all procurements 
     involving energy consuming products and systems, including 
     guide specifications, project specifications, and 
     construction, renovation, and services contracts that include 
     provision of energy consuming products and systems, and into 
     the factors for the evaluation of offers received for the 
     procurement, criteria for energy efficiency that are 
     consistent with the criteria used for rating Energy Star 
     products and for rating FEMP designated products.
       ``(c) Listing of Energy Efficient Products in Federal 
     Catalogs.--Energy Star products and FEMP designated products 
     shall be clearly identified and prominently displayed in any 
     inventory or listing of products by the General Services 
     Administration or the Defense Logistics Agency. The General 
     Services Administration or the Defense Logistics Agency shall 
     supply only Energy Star products or FEMP designated products 
     for all product categories covered by the Energy Star program 
     or the Federal Energy Management Program, except in cases 
     where the agency ordering a product specifies in writing that 
     no Energy Star product or FEMP designated product is 
     available to meet the buyer's functional requirements, or 
     that no Energy Star product or FEMP designated product is 
     cost-effective for the intended application over the life of 
     the product, taking energy cost savings into account.
       ``(d) Specific Products.--(1) In the case of electric 
     motors of 1 to 500 horsepower, agencies shall select only 
     premium efficient motors that meet a standard designated by 
     the Secretary. The Secretary shall designate such a standard 
     not later than 120 days after the date of the enactment of 
     this section, after considering the recommendations of 
     associated electric motor manufacturers and energy efficiency 
     groups.
       ``(2) All Federal agencies are encouraged to take actions 
     to maximize the efficiency of air conditioning and 
     refrigeration equipment, including appropriate cleaning and 
     maintenance, including the use of any system treatment or 
     additive that will reduce the electricity consumed by air 
     conditioning and refrigeration equipment. Any such treatment 
     or additive must be--
       ``(A) determined by the Secretary to be effective in 
     increasing the efficiency of air conditioning and 
     refrigeration equipment without having an adverse impact on 
     air conditioning

[[Page 17799]]

     performance (including cooling capacity) or equipment useful 
     life;
       ``(B) determined by the Administrator of the Environmental 
     Protection Agency to be environmentally safe; and
       ``(C) shown to increase seasonal energy efficiency ratio 
     (SEER) or energy efficiency ratio (EER) when tested by the 
     National Institute of Standards and Technology according to 
     Department of Energy test procedures without causing any 
     adverse impact on the system, system components, the 
     refrigerant or lubricant, or other materials in the system.

     Results of testing described in subparagraph (C) shall be 
     published in the Federal Register for public review and 
     comment. For purposes of this section, a hardware device or 
     primary refrigerant shall not be considered an additive.
       ``(e) Regulations.--Not later than 180 days after the date 
     of the enactment of this section, the Secretary shall issue 
     guidelines to carry out this section.''.
       (b) Conforming Amendment.--The table of contents of the 
     National Energy Conservation Policy Act is further amended by 
     inserting after the item relating to section 552 the 
     following new item:

``Sec. 553. Federal procurement of energy efficient products.''.

     SEC. 105. ENERGY SAVINGS PERFORMANCE CONTRACTS.

       (a) Extension.--Section 801(c) of the National Energy 
     Conservation Policy Act (42 U.S.C. 8287(c)) is amended by 
     striking ``2006'' and inserting ``2016''.
       (b) Extension of Authority.--Any energy savings performance 
     contract entered into under section 801 of the National 
     Energy Conservation Policy Act (42 U.S.C. 8287) after October 
     1, 2003, and before the date of enactment of this Act, shall 
     be considered to have been entered into under that section.

     SEC. 106. VOLUNTARY COMMITMENTS TO REDUCE INDUSTRIAL ENERGY 
                   INTENSITY.

       (a) Definition of Energy Intensity.--In this section, the 
     term ``energy intensity'' means the primary energy consumed 
     for each unit of physical output in an industrial process.
       (b) Voluntary Agreements.--The Secretary may enter into 
     voluntary agreements with 1 or more persons in industrial 
     sectors that consume significant quantities of primary energy 
     for each unit of physical output to reduce the energy 
     intensity of the production activities of the persons.
       (c) Goal.--Voluntary agreements under this section shall 
     have as a goal the reduction of energy intensity by not less 
     than 2.5 percent each year during the period of calendar 
     years 2007 through 2016.
       (d) Recognition.--The Secretary, in cooperation with other 
     appropriate Federal agencies, shall develop mechanisms to 
     recognize and publicize the achievements of participants in 
     voluntary agreements under this section.
       (e) Technical Assistance.--A person that enters into an 
     agreement under this section and continues to make a good 
     faith effort to achieve the energy efficiency goals specified 
     in the agreement shall be eligible to receive from the 
     Secretary a grant or technical assistance, as appropriate, to 
     assist in the achievement of those goals.
       (f) Report.--Not later than each of June 30, 2012, and June 
     30, 2017, the Secretary shall submit to Congress a report 
     that--
       (1) evaluates the success of the voluntary agreements under 
     this section; and
       (2) provides independent verification of a sample of the 
     energy savings estimates provided by participating firms.

     SEC. 107. ADVANCED BUILDING EFFICIENCY TESTBED.

       (a) Establishment.--The Secretary, in consultation with the 
     Administrator of General Services, shall establish an 
     Advanced Building Efficiency Testbed program for the 
     development, testing, and demonstration of advanced 
     engineering systems, components, and materials to enable 
     innovations in building technologies. The program shall 
     evaluate efficiency concepts for government and industry 
     buildings, and demonstrate the ability of next generation 
     buildings to support individual and organizational 
     productivity and health (including by improving indoor air 
     quality) as well as flexibility and technological change to 
     improve environmental sustainability. Such program shall 
     complement and not duplicate existing national programs.
       (b) Participants.--The program established under subsection 
     (a) shall be led by a university with the ability to combine 
     the expertise from numerous academic fields including, at a 
     minimum, intelligent workplaces and advanced building systems 
     and engineering, electrical and computer engineering, 
     computer science, architecture, urban design, and 
     environmental and mechanical engineering. Such university 
     shall partner with other universities and entities who have 
     established programs and the capability of advancing 
     innovative building efficiency technologies.
       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary to carry out this section 
     $6,000,000 for each of the fiscal years 2006 through 2008, to 
     remain available until expended. For any fiscal year in which 
     funds are expended under this section, the Secretary shall 
     provide \1/3\ of the total amount to the lead university 
     described in subsection (b), and provide the remaining \2/3\ 
     to the other participants referred to in subsection (b) on an 
     equal basis.

     SEC. 108. INCREASED USE OF RECOVERED MINERAL COMPONENT IN 
                   FEDERALLY FUNDED PROJECTS INVOLVING PROCUREMENT 
                   OF CEMENT OR CONCRETE.

       (a) Amendment.--Subtitle F of the Solid Waste Disposal Act 
     (42 U.S.C. 6961 et seq.) is amended by adding at the end the 
     following:


  ``INCREASED USE OF RECOVERED MINERAL COMPONENT IN FEDERALLY FUNDED 
          PROJECTS INVOLVING PROCUREMENT OF CEMENT OR CONCRETE

       ``Sec. 6005. (a) Definitions.--In this section:
       ``(1) Agency head.--The term `agency head' means--
       ``(A) the Secretary of Transportation; and
       ``(B) the head of any other Federal agency that, on a 
     regular basis, procures, or provides Federal funds to pay or 
     assist in paying the cost of procuring, material for cement 
     or concrete projects.
       ``(2) Cement or concrete project.--The term `cement or 
     concrete project' means a project for the construction or 
     maintenance of a highway or other transportation facility or 
     a Federal, State, or local government building or other 
     public facility that--
       ``(A) involves the procurement of cement or concrete; and
       ``(B) is carried out, in whole or in part, using Federal 
     funds.
       ``(3) Recovered mineral component.--The term `recovered 
     mineral component' means--
       ``(A) ground granulated blast furnace slag, excluding lead 
     slag;
       ``(B) coal combustion fly ash; and
       ``(C) any other waste material or byproduct recovered or 
     diverted from solid waste that the Administrator, in 
     consultation with an agency head, determines should be 
     treated as recovered mineral component under this section for 
     use in cement or concrete projects paid for, in whole or in 
     part, by the agency head.
       ``(b) Implementation of Requirements.--
       ``(1) In general.--Not later than 1 year after the date of 
     enactment of this section, the Administrator and each agency 
     head shall take such actions as are necessary to implement 
     fully all procurement requirements and incentives in effect 
     as of the date of enactment of this section (including 
     guidelines under section 6002) that provide for the use of 
     cement and concrete incorporating recovered mineral component 
     in cement or concrete projects.
       ``(2) Priority.--In carrying out paragraph (1), an agency 
     head shall give priority to achieving greater use of 
     recovered mineral component in cement or concrete projects 
     for which recovered mineral components historically have not 
     been used or have been used only minimally.
       ``(3) Federal procurement requirements.--The Administrator 
     and each agency head shall carry out this subsection in 
     accordance with section 6002.
       ``(c) Full Implementation Study.--
       ``(1) In general.--The Administrator, in cooperation with 
     the Secretary of Transportation and the Secretary of Energy, 
     shall conduct a study to determine the extent to which 
     procurement requirements, when fully implemented in 
     accordance with subsection (b), may realize energy savings 
     and environmental benefits attainable with substitution of 
     recovered mineral component in cement used in cement or 
     concrete projects.
       ``(2) Matters to be addressed.--The study shall--
       ``(A) quantify--
       ``(i) the extent to which recovered mineral components are 
     being substituted for Portland cement, particularly as a 
     result of procurement requirements; and
       ``(ii) the energy savings and environmental benefits 
     associated with the substitution;
       ``(B) identify all barriers in procurement requirements to 
     greater realization of energy savings and environmental 
     benefits, including barriers resulting from exceptions from 
     the law; and
       ``(C)(i) identify potential mechanisms to achieve greater 
     substitution of recovered mineral component in types of 
     cement or concrete projects for which recovered mineral 
     components historically have not been used or have been used 
     only minimally;
       ``(ii) evaluate the feasibility of establishing guidelines 
     or standards for optimized substitution rates of recovered 
     mineral component in those cement or concrete projects; and
       ``(iii) identify any potential environmental or economic 
     effects that may result from greater substitution of 
     recovered mineral component in those cement or concrete 
     projects.
       ``(3) Report.--Not later than 30 months after the date of 
     enactment of this section, the Administrator shall submit to 
     Congress a report on the study.
       ``(d) Additional Procurement Requirements.--Unless the 
     study conducted under subsection (c) identifies any effects 
     or other problems described in subsection (c)(2)(C)(iii) that 
     warrant further review or delay, the Administrator and each 
     agency head shall, not later than 1 year after the date on 
     which the report under subsection (c)(3) is submitted, take 
     additional actions under this Act to establish procurement 
     requirements and incentives that provide for the use of 
     cement and concrete with increased substitution of recovered 
     mineral component in the construction and maintenance of 
     cement or concrete projects--
       ``(1) to realize more fully the energy savings and 
     environmental benefits associated with increased 
     substitution; and
       ``(2) to eliminate barriers identified under subsection 
     (c)(2)(B).
       ``(e) Effect of Section.--Nothing in this section affects 
     the requirements of section 6002 (including the guidelines 
     and specifications for implementing those requirements).''.
       (b) Conforming Amendment.--The table of contents of the 
     Solid Waste Disposal Act is

[[Page 17800]]

     amended by adding after the item relating to section 6004 the 
     following:

``Sec. 6005. Increased use of recovered mineral component in federally 
              funded projects involving procurement of cement or 
              concrete.''.

     SEC. 109. FEDERAL BUILDING PERFORMANCE STANDARDS.

       Section 305(a) of the Energy Conservation and Production 
     Act (42 U.S.C. 6834(a)) is amended--
       (1) in paragraph (2)(A), by striking ``CABO Model Energy 
     Code, 1992 (in the case of residential buildings) or ASHRAE 
     Standard 90.1-1989'' and inserting ``the 2004 International 
     Energy Conservation Code (in the case of residential 
     buildings) or ASHRAE Standard 90.1-2004''; and
       (2) by adding at the end the following:
       ``(3)(A) Not later than 1 year after the date of enactment 
     of this paragraph, the Secretary shall establish, by rule, 
     revised Federal building energy efficiency performance 
     standards that require that--
       ``(i) if life-cycle cost-effective for new Federal 
     buildings--
       ``(I) the buildings be designed to achieve energy 
     consumption levels that are at least 30 percent below the 
     levels established in the version of the ASHRAE Standard or 
     the International Energy Conservation Code, as appropriate, 
     that is in effect as of the date of enactment of this 
     paragraph; and
       ``(II) sustainable design principles are applied to the 
     siting, design, and construction of all new and replacement 
     buildings; and
       ``(ii) if water is used to achieve energy efficiency, water 
     conservation technologies shall be applied to the extent that 
     the technologies are life-cycle cost-effective.
       ``(iii) Not later than 1 year after the date of approval of 
     each subsequent revision of the ASHRAE Standard or the 
     International Energy Conservation Code, as appropriate, the 
     Secretary shall determine, based on the cost-effectiveness of 
     the requirements under the amendment, whether the revised 
     standards established under this paragraph should be updated 
     to reflect the amendment.
       ``(iv) In the budget request of the Federal agency for each 
     fiscal year and each report submitted by the Federal agency 
     under section 548(a) of the National Energy Conservation 
     Policy Act (42 U.S.C. 8258(a)), the head of each Federal 
     agency shall include--
       ``(v) a list of all new Federal buildings owned, operated, 
     or controlled by the Federal agency; and
       ``(vi) a statement specifying whether the Federal buildings 
     meet or exceed the revised standards established under this 
     paragraph.''.

     SEC. 110. DAYLIGHT SAVINGS.

       (a) Amendment.--Section 3(a) of the Uniform Time Act of 
     1966 (15 U.S.C. 260a(a)) is amended--
       (1) by striking ``first Sunday of April'' and inserting 
     ``second Sunday of March''; and
       (2) by striking ``last Sunday of October'' and inserting 
     ``first Sunday of November''.
       (b) Effective Date.--Subsection (a) shall take effect 1 
     year after the date of enactment of this Act or March 1, 
     2007, whichever is later.
       (c) Report to Congress.--Not later than 9 months after the 
     effective date stated in subsection (b), the Secretary shall 
     report to Congress on the impact of this section on energy 
     consumption in the United States.
       (d) Right to Revert.--Congress retains the right to revert 
     the Daylight Saving Time back to the 2005 time schedules once 
     the Department study is complete.

     SEC. 111. ENHANCING ENERGY EFFICIENCY IN MANAGEMENT OF 
                   FEDERAL LANDS.

       (a) Sense of the Congress.--It is the sense of the Congress 
     that Federal agencies should enhance the use of energy 
     efficient technologies in the management of natural 
     resources.
       (b) Energy Efficient Buildings.--To the extent practicable, 
     the Secretary of the Interior, the Secretary of Commerce, and 
     the Secretary of Agriculture shall seek to incorporate energy 
     efficient technologies in public and administrative buildings 
     associated with management of the National Park System, 
     National Wildlife Refuge System, National Forest System, 
     National Marine Sanctuaries System, and other public lands 
     and resources managed by the Secretaries.
       (c) Energy Efficient Vehicles.--To the extent practicable, 
     the Secretary of the Interior, the Secretary of Commerce, and 
     the Secretary of Agriculture shall seek to use energy 
     efficient motor vehicles, including vehicles equipped with 
     biodiesel or hybrid engine technologies, in the management of 
     the National Park System, National Wildlife Refuge System, 
     National Forest System, National Marine Sanctuaries System, 
     and other public lands and resources managed by the 
     Secretaries.
            Subtitle B--Energy Assistance and State Programs

     SEC. 121. LOW INCOME HOME ENERGY ASSISTANCE PROGRAM.

       (a) Authorization of Appropriations.--Section 2602(b) of 
     the Low-Income Home Energy Assistance Act of 1981 (42 U.S.C. 
     8621(b)) is amended by striking ``and $2,000,000,000 for each 
     of fiscal years 2002 through 2004'' and inserting ``and 
     $5,100,000,000 for each of fiscal years 2005 through 2007''.
       (b) Renewable Fuels.--The Low-Income Home Energy Assistance 
     Act of 1981 (42 U.S.C. 8621 et seq.) is amended by adding at 
     the end the following new section:


                           ``RENEWABLE FUELS

       ``Sec. 2612. In providing assistance pursuant to this 
     title, a State, or any other person with which the State 
     makes arrangements to carry out the purposes of this title, 
     may purchase renewable fuels, including biomass.''.
       (c) Report to Congress.--The Secretary shall report to 
     Congress on the use of renewable fuels in providing 
     assistance under the Low-Income Home Energy Assistance Act of 
     1981 (42 U.S.C. 8621 et seq.).

     SEC. 122. WEATHERIZATION ASSISTANCE.

       (a) Authorization of Appropriations.--Section 422 of the 
     Energy Conservation and Production Act (42 U.S.C. 6872) is 
     amended by striking ``for fiscal years 1999 through 2003 such 
     sums as may be necessary'' and inserting ``$500,000,000 for 
     fiscal year 2006, $600,000,000 for fiscal year 2007, and 
     $700,000,000 for fiscal year 2008''.
       (b) Eligibility.--Section 412(7) of the Energy Conservation 
     and Production Act (42 U.S.C. 6862(7)) is amended by striking 
     ``125 percent'' both places it appears and inserting ``150 
     percent''.

     SEC. 123. STATE ENERGY PROGRAMS.

       (a) State Energy Conservation Plans.--Section 362 of the 
     Energy Policy and Conservation Act (42 U.S.C. 6322) is 
     amended by inserting at the end the following new subsection:
       ``(g) The Secretary shall, at least once every 3 years, 
     invite the Governor of each State to review and, if 
     necessary, revise the energy conservation plan of such State 
     submitted under subsection (b) or (e). Such reviews should 
     consider the energy conservation plans of other States within 
     the region, and identify opportunities and actions carried 
     out in pursuit of common energy conservation goals.''.
       (b) State Energy Efficiency Goals.--Section 364 of the 
     Energy Policy and Conservation Act (42 U.S.C. 6324) is 
     amended to read as follows:


                    ``STATE ENERGY EFFICIENCY GOALS

       ``Sec. 364. Each State energy conservation plan with 
     respect to which assistance is made available under this part 
     on or after the date of enactment of the Energy Policy Act of 
     2005 shall contain a goal, consisting of an improvement of 25 
     percent or more in the efficiency of use of energy in the 
     State concerned in calendar year 2012 as compared to calendar 
     year 1990, and may contain interim goals.''.
       (c) Authorization of Appropriations.--Section 365(f) of the 
     Energy Policy and Conservation Act (42 U.S.C. 6325(f)) is 
     amended by striking ``for fiscal years 1999 through 2003 such 
     sums as may be necessary'' and inserting ``$100,000,000 for 
     each of the fiscal years 2006 and 2007 and $125,000,000 for 
     fiscal year 2008''.

     SEC. 124. ENERGY EFFICIENT APPLIANCE REBATE PROGRAMS.

       (a) Definitions.--In this section:
       (1) Eligible state.--The term ``eligible State'' means a 
     State that meets the requirements of subsection (b).
       (2) Energy star program.--The term ``Energy Star program'' 
     means the program established by section 324A of the Energy 
     Policy and Conservation Act.
       (3) Residential energy star product.--The term 
     ``residential Energy Star product'' means a product for a 
     residence that is rated for energy efficiency under the 
     Energy Star program.
       (4) State energy office.--The term ``State energy office'' 
     means the State agency responsible for developing State 
     energy conservation plans under section 362 of the Energy 
     Policy and Conservation Act (42 U.S.C. 6322).
       (5) State program.--The term ``State program'' means a 
     State energy efficient appliance rebate program described in 
     subsection (b)(1).
       (b) Eligible States.--A State shall be eligible to receive 
     an allocation under subsection (c) if the State--
       (1) establishes (or has established) a State energy 
     efficient appliance rebate program to provide rebates to 
     residential consumers for the purchase of residential Energy 
     Star products to replace used appliances of the same type;
       (2) submits an application for the allocation at such time, 
     in such form, and containing such information as the 
     Secretary may require; and
       (3) provides assurances satisfactory to the Secretary that 
     the State will use the allocation to supplement, but not 
     supplant, funds made available to carry out the State 
     program.
       (c) Amount of Allocations.--
       (1) In general.--Subject to paragraph (2), for each fiscal 
     year, the Secretary shall allocate to the State energy office 
     of each eligible State to carry out subsection (d) an amount 
     equal to the product obtained by multiplying the amount made 
     available under subsection (f) for the fiscal year by the 
     ratio that the population of the State in the most recent 
     calendar year for which data are available bears to the total 
     population of all eligible States in that calendar year.
       (2) Minimum allocations.--For each fiscal year, the amounts 
     allocated under this subsection shall be adjusted 
     proportionately so that no eligible State is allocated a sum 
     that is less than an amount determined by the Secretary.
       (d) Use of Allocated Funds.--The allocation to a State 
     energy office under subsection (c) may be used to pay up to 
     50 percent of the cost of establishing and carrying out a 
     State program.
       (e) Issuance of Rebates.--Rebates may be provided to 
     residential consumers that meet the requirements of the State 
     program. The amount of a rebate shall be determined by the 
     State energy office, taking into consideration--
       (1) the amount of the allocation to the State energy office 
     under subsection (c);
       (2) the amount of any Federal or State tax incentive 
     available for the purchase of the residential Energy Star 
     product; and
       (3) the difference between the cost of the residential 
     Energy Star product and the cost of an

[[Page 17801]]

     appliance that is not a residential Energy Star product, but 
     is of the same type as, and is the nearest capacity, 
     performance, and other relevant characteristics (as 
     determined by the State energy office) to, the residential 
     Energy Star product.
       (f) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary to carry out this section 
     $50,000,000 for each of the fiscal years 2006 through 2010.

     SEC. 125. ENERGY EFFICIENT PUBLIC BUILDINGS.

       (a) Grants.--The Secretary may make grants to the State 
     agency responsible for developing State energy conservation 
     plans under section 362 of the Energy Policy and Conservation 
     Act (42 U.S.C. 6322), or, if no such agency exists, a State 
     agency designated by the Governor of the State, to assist 
     units of local government in the State in improving the 
     energy efficiency of public buildings and facilities--
       (1) through construction of new energy efficient public 
     buildings that use at least 30 percent less energy than a 
     comparable public building constructed in compliance with 
     standards prescribed in the most recent version of the 
     International Energy Conservation Code, or a similar State 
     code intended to achieve substantially equivalent efficiency 
     levels; or
       (2) through renovation of existing public buildings to 
     achieve reductions in energy use of at least 30 percent as 
     compared to the baseline energy use in such buildings prior 
     to renovation, assuming a 3-year, weather-normalized average 
     for calculating such baseline.
       (b) Administration.--State energy offices receiving grants 
     under this section shall--
       (1) maintain such records and evidence of compliance as the 
     Secretary may require; and
       (2) develop and distribute information and materials and 
     conduct programs to provide technical services and assistance 
     to encourage planning, financing, and design of energy 
     efficient public buildings by units of local government.
       (c) Authorization of Appropriations.--For the purposes of 
     this section, there are authorized to be appropriated to the 
     Secretary $30,000,000 for each of fiscal years 2006 through 
     2010. Not more than 10 percent of appropriated funds shall be 
     used for administration.

     SEC. 126. LOW INCOME COMMUNITY ENERGY EFFICIENCY PILOT 
                   PROGRAM.

       (a) Grants.--The Secretary is authorized to make grants to 
     units of local government, private, non-profit community 
     development organizations, and Indian tribe economic 
     development entities to improve energy efficiency; identify 
     and develop alternative, renewable, and distributed energy 
     supplies; and increase energy conservation in low income 
     rural and urban communities.
       (b) Purpose of Grants.--The Secretary may make grants on a 
     competitive basis for--
       (1) investments that develop alternative, renewable, and 
     distributed energy supplies;
       (2) energy efficiency projects and energy conservation 
     programs;
       (3) studies and other activities that improve energy 
     efficiency in low income rural and urban communities;
       (4) planning and development assistance for increasing the 
     energy efficiency of buildings and facilities; and
       (5) technical and financial assistance to local government 
     and private entities on developing new renewable and 
     distributed sources of power or combined heat and power 
     generation.
       (c) Definition.--For purposes of this section, the term 
     ``Indian tribe'' means any Indian tribe, band, nation, or 
     other organized group or community, including any Alaskan 
     Native village or regional or village corporation as defined 
     in or established pursuant to the Alaska Native Claims 
     Settlement Act (43 U.S.C. 1601 et seq.), that is recognized 
     as eligible for the special programs and services provided by 
     the United States to Indians because of their status as 
     Indians.
       (d) Authorization of Appropriations.--For the purposes of 
     this section there are authorized to be appropriated to the 
     Secretary $20,000,000 for each of fiscal years 2006 through 
     2008.

     SEC. 127. STATE TECHNOLOGIES ADVANCEMENT COLLABORATIVE.

       (a) In General.--The Secretary, in cooperation with the 
     States, shall establish a cooperative program for research, 
     development, demonstration, and deployment of technologies in 
     which there is a common Federal and State energy efficiency, 
     renewable energy, and fossil energy interest, to be known as 
     the ``State Technologies Advancement Collaborative'' 
     (referred to in this section as the ``Collaborative'').
       (b) Duties.--The Collaborative shall--
       (1) leverage Federal and State funding through cost-shared 
     activity;
       (2) reduce redundancies in Federal and State funding; and
       (3) create multistate projects to be awarded through a 
     competitive process.
       (c) Administration.--The Collaborative shall be 
     administered through an agreement between the Department and 
     appropriate State-based organizations.
       (d) Funding Sources.--Funding for the Collaborative may be 
     provided from--
       (1) amounts specifically appropriated for the 
     Collaborative; or
       (2) amounts that may be allocated from other appropriations 
     without changing the purpose for which the amounts are 
     appropriated.
       (e) Authorization of Appropriations.--There are authorized 
     to carry out this section such sums as are necessary for each 
     of fiscal years 2006 through 2010.

     SEC. 128. STATE BUILDING ENERGY EFFICIENCY CODES INCENTIVES.

       Section 304(e) of the Energy Conservation and Production 
     Act (42 U.S.C. 6833(e)) is amended--
       (1) in paragraph (1), by inserting before the period at the 
     end of the first sentence the following: ``, including 
     increasing and verifying compliance with such codes''; and
       (2) by striking paragraph (2) and inserting the following:
       ``(2) Additional funding shall be provided under this 
     subsection for implementation of a plan to achieve and 
     document at least a 90 percent rate of compliance with 
     residential and commercial building energy efficiency codes, 
     based on energy performance--
       ``(A) to a State that has adopted and is implementing, on a 
     statewide basis--
       ``(i) a residential building energy efficiency code that 
     meets or exceeds the requirements of the 2004 International 
     Energy Conservation Code, or any succeeding version of that 
     code that has received an affirmative determination from the 
     Secretary under subsection (a)(5)(A); and
       ``(ii) a commercial building energy efficiency code that 
     meets or exceeds the requirements of the ASHRAE Standard 
     90.1-2004, or any succeeding version of that standard that 
     has received an affirmative determination from the Secretary 
     under subsection (b)(2)(A); or
       ``(B) in a State in which there is no statewide energy code 
     either for residential buildings or for commercial buildings, 
     to a local government that has adopted and is implementing 
     residential and commercial building energy efficiency codes, 
     as described in subparagraph (A).
       ``(3) Of the amounts made available under this subsection, 
     the Secretary may use $500,000 for each fiscal year to train 
     State and local officials to implement codes described in 
     paragraph (2).
       ``(4)(A) There are authorized to be appropriated to carry 
     out this subsection--
       ``(i) $25,000,000 for each of fiscal years 2006 through 
     2010; and
       ``(ii) such sums as are necessary for fiscal year 2011 and 
     each fiscal year thereafter.
       ``(iii) Funding provided to States under paragraph (2) for 
     each fiscal year shall not exceed \1/2\ of the excess of 
     funding under this subsection over $5,000,000 for the fiscal 
     year.''.
                 Subtitle C--Energy Efficient Products

     SEC. 131. ENERGY STAR PROGRAM.

       (a) In General.--The Energy Policy and Conservation Act is 
     amended by inserting after section 324 (42 U.S.C. 6294) the 
     following:


                         ``ENERGY STAR PROGRAM

       ``Sec. 324A. (a) In General.--There is established within 
     the Department of Energy and the Environmental Protection 
     Agency a voluntary program to identify and promote energy-
     efficient products and buildings in order to reduce energy 
     consumption, improve energy security, and reduce pollution 
     through voluntary labeling of, or other forms of 
     communication about, products and buildings that meet the 
     highest energy conservation standards.
       ``(b) Division of Responsibilities.--Responsibilities under 
     the program shall be divided between the Department of Energy 
     and the Environmental Protection Agency in accordance with 
     the terms of applicable agreements between those agencies.
       ``(c) Duties.--The Administrator and the Secretary shall--
       ``(1) promote Energy Star compliant technologies as the 
     preferred technologies in the marketplace for--
       ``(A) achieving energy efficiency; and
       ``(B) reducing pollution;
       ``(2) work to enhance public awareness of the Energy Star 
     label, including by providing special outreach to small 
     businesses;
       ``(3) preserve the integrity of the Energy Star label;
       ``(4) regularly update Energy Star product criteria for 
     product categories;
       ``(5) solicit comments from interested parties prior to 
     establishing or revising an Energy Star product category, 
     specification, or criterion (or prior to effective dates for 
     any such product category, specification, or criterion);
       ``(6) on adoption of a new or revised product category, 
     specification, or criterion, provide reasonable notice to 
     interested parties of any changes (including effective dates) 
     in product categories, specifications, or criteria, along 
     with--
       ``(A) an explanation of the changes; and
       ``(B) as appropriate, responses to comments submitted by 
     interested parties; and
       ``(7) provide appropriate lead time (which shall be 270 
     days, unless the Agency or Department specifies otherwise) 
     prior to the applicable effective date for a new or a 
     significant revision to a product category, specification, or 
     criterion, taking into account the timing requirements of the 
     manufacturing, product marketing, and distribution process 
     for the specific product addressed.
       ``(d) Deadlines.--The Secretary shall establish new 
     qualifying levels--
       ``(1) not later than January 1, 2006, for clothes washers 
     and dishwashers, effective beginning January 1, 2007; and
       ``(2) not later than January 1, 2008, for clothes washers, 
     effective beginning January 1, 2010.''.
       (b) Table of Contents Amendment.--The table of contents of 
     the Energy Policy and Conservation Act (42 U.S.C. prec. 6201) 
     is amended by inserting after the item relating to section 
     324 the following:

``Sec. 324A. Energy Star program.''.

     SEC. 132. HVAC MAINTENANCE CONSUMER EDUCATION PROGRAM.

       Section 337 of the Energy Policy and Conservation Act (42 
     U.S.C. 6307) is amended by adding at the end the following:

[[Page 17802]]

       ``(c) HVAC Maintenance.--(1) To ensure that installed air 
     conditioning and heating systems operate at maximum rated 
     efficiency levels, the Secretary shall, not later than 180 
     days after the date of enactment of this subsection, carry 
     out a program to educate homeowners and small business owners 
     concerning the energy savings from properly conducted 
     maintenance of air conditioning, heating, and ventilating 
     systems.
       ``(2) The Secretary shall carry out the program under 
     paragraph (1), on a cost-shared basis, in cooperation with 
     the Administrator of the Environmental Protection Agency and 
     any other entities that the Secretary determines to be 
     appropriate, including industry trade associations, industry 
     members, and energy efficiency organizations.
       ``(d) Small Business Education and Assistance.--(1) The 
     Administrator of the Small Business Administration, in 
     consultation with the Secretary and the Administrator of the 
     Environmental Protection Agency, shall develop and coordinate 
     a Government-wide program, building on the Energy Star for 
     Small Business Program, to assist small businesses in--
       ``(A) becoming more energy efficient;
       ``(B) understanding the cost savings from improved energy 
     efficiency;
       ``(C) understanding and accessing Federal procurement 
     opportunities with regard to Energy Star technologies and 
     products; and
       ``(D) identifying financing options for energy efficiency 
     upgrades.
       ``(2) The Secretary, the Administrator of the Environmental 
     Protection Agency, and the Administrator of the Small 
     Business Administration shall--
       ``(A) make program information available to small business 
     concerns directly through the district offices and resource 
     partners of the Small Business Administration, including 
     small business development centers, women's business centers, 
     and the Service Corps of Retired Executives (SCORE), and 
     through other Federal agencies, including the Federal 
     Emergency Management Agency and the Department of 
     Agriculture; and
       ``(B) coordinate assistance with the Secretary of Commerce 
     for manufacturing-related efforts, including the 
     Manufacturing Extension Partnership Program.
       ``(3) The Secretary, on a cost shared basis in cooperation 
     with the Administrator of the Environmental Protection 
     Agency, shall provide to the Small Business Administration 
     all advertising, marketing, and other written materials 
     necessary for the dissemination of information under 
     paragraph (2).
       ``(4) The Secretary, the Administrator of the Environmental 
     Protection Agency, and the Administrator of the Small 
     Business Administration, as part of the outreach to small 
     business concerns under the Energy Star Program for Small 
     Business Program, may enter into cooperative agreements with 
     qualified resources partners (including the National Center 
     for Appropriate Technology) to establish, maintain, and 
     promote a Small Business Energy Clearinghouse (in this 
     subsection referred to as the `Clearinghouse').
       ``(5) The Secretary, the Administrator of the Environmental 
     Protection Agency, and the Administrator of the Small 
     Business Administration shall ensure that the Clearinghouse 
     provides a centralized resource where small business concerns 
     may access, telephonically and electronically, technical 
     information and advice to help increase energy efficiency and 
     reduce energy costs.
       ``(6) There are authorized to be appropriated such sums as 
     are necessary to carry out this subsection, to remain 
     available until expended.''.

     SEC. 133. PUBLIC ENERGY EDUCATION PROGRAM.

       (a) In General.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary shall convene an 
     organizational conference for the purpose of establishing an 
     ongoing, self-sustaining national public energy education 
     program.
       (b) Participants.--The Secretary shall invite to 
     participate in the conference individuals and entities 
     representing all aspects of energy production and 
     distribution, including--
       (1) industrial firms;
       (2) professional societies;
       (3) educational organizations;
       (4) trade associations; and
       (5) governmental agencies.
       (c) Purpose, Scope, and Structure.--
       (1) Purpose.--The purpose of the conference shall be to 
     establish an ongoing, self-sustaining national public energy 
     education program to examine and recognize interrelationships 
     between energy sources in all forms, including--
       (A) conservation and energy efficiency;
       (B) the role of energy use in the economy; and
       (C) the impact of energy use on the environment.
       (2) Scope and structure.--Taking into consideration the 
     purpose described in paragraph (1), the participants in the 
     conference invited under subsection (b) shall design the 
     scope and structure of the program described in subsection 
     (a).
       (d) Technical Assistance.--The Secretary shall provide 
     technical assistance and other guidance necessary to carry 
     out the program described in subsection (a).
       (e) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section.

     SEC. 134. ENERGY EFFICIENCY PUBLIC INFORMATION INITIATIVE.

       (a) In General.--The Secretary shall carry out a 
     comprehensive national program, including advertising and 
     media awareness, to inform consumers about--
       (1) the need to reduce energy consumption during the 4-year 
     period beginning on the date of enactment of this Act;
       (2) the benefits to consumers of reducing consumption of 
     electricity, natural gas, and petroleum, particularly during 
     peak use periods;
       (3) the importance of low energy costs to economic growth 
     and preserving manufacturing jobs in the United States; and
       (4) practical, cost-effective measures that consumers can 
     take to reduce consumption of electricity, natural gas, and 
     gasoline, including--
       (A) maintaining and repairing heating and cooling ducts and 
     equipment;
       (B) weatherizing homes and buildings;
       (C) purchasing energy efficient products; and
       (D) proper tire maintenance.
       (b) Cooperation.--The program carried out under subsection 
     (a) shall--
       (1) include collaborative efforts with State and local 
     government officials and the private sector; and
       (2) incorporate, to the maximum extent practicable, 
     successful State and local public education programs.
       (c) Report.--Not later than July 1, 2009, the Secretary 
     shall submit to Congress a report describing the 
     effectiveness of the program under this section.
       (d) Termination of Authority.--The program carried out 
     under this section shall terminate on December 31, 2010.
       (e) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section $90,000,000 for 
     each of fiscal years 2006 through 2010.

     SEC. 135. ENERGY CONSERVATION STANDARDS FOR ADDITIONAL 
                   PRODUCTS.

       (a) Definitions.--Section 321 of the Energy Policy and 
     Conservation Act (42 U.S.C. 6291) is amended--
       (1) in paragraph (29)--
       (A) in subparagraph (D)--
       (i) in clause (i), by striking ``C78.1-1978(R1984)'' and 
     inserting ``C78.81-2003 (Data Sheet 7881-ANSI-1010-1)'';
       (ii) in clause (ii), by striking ``C78.1-1978(R1984)'' and 
     inserting ``C78.81-2003 (Data Sheet 7881-ANSI-3007-1)''; and
       (iii) in clause (iii), by striking ``C78.1-1978(R1984)'' 
     and inserting ``C78.81-2003 (Data Sheet 7881-ANSI-1019-1)''; 
     and
       (B) by adding at the end the following:
       ``(M) The term `F34T12 lamp' (also known as a `F40T12/ES 
     lamp') means a nominal 34 watt tubular fluorescent lamp that 
     is 48 inches in length and 1\1/2\ inches in diameter, and 
     conforms to ANSI standard C78.81-2003 (Data Sheet 7881-ANSI-
     1006-1).
       ``(N) The term `F96T12/ES lamp' means a nominal 60 watt 
     tubular fluorescent lamp that is 96 inches in length and 1\1/
     2\ inches in diameter, and conforms to ANSI standard C78.81-
     2003 (Data Sheet 7881-ANSI-3006-1).
       ``(O) The term `F96T12HO/ES lamp' means a nominal 95 watt 
     tubular fluorescent lamp that is 96 inches in length and 1\1/
     2\ inches in diameter, and conforms to ANSI standard C78.81-
     2003 (Data Sheet 7881-ANSI-1017-1).
       ``(P) The term `replacement ballast' means a ballast that--
       ``(i) is designed for use to replace an existing ballast in 
     a previously installed luminaire;
       ``(ii) is marked `FOR REPLACEMENT USE ONLY';
       ``(iii) is shipped by the manufacturer in packages 
     containing not more than 10 ballasts; and
       ``(iv) has output leads that when fully extended are a 
     total length that is less than the length of the lamp with 
     which the ballast is intended to be operated.'';
       (2) in paragraph (30)(S)--
       (A) by inserting ``(i)'' before ``The term''; and
       (B) by adding at the end the following:
       ``(ii) The term `medium base compact fluorescent lamp' does 
     not include--
       ``(I) any lamp that is--

       ``(aa) specifically designed to be used for special purpose 
     applications; and
       ``(bb) unlikely to be used in general purpose applications, 
     such as the applications described in subparagraph (D); or

       ``(II) any lamp not described in subparagraph (D) that is 
     excluded by the Secretary, by rule, because the lamp is--

       ``(aa) designed for special applications; and
       ``(bb) unlikely to be used in general purpose 
     applications.''; and

       (3) by adding at the end the following:
       ``(32) The term `battery charger' means a device that 
     charges batteries for consumer products, including battery 
     chargers embedded in other consumer products.
       ``(33)(A) The term `commercial prerinse spray valve' means 
     a handheld device designed and marketed for use with 
     commercial dishwashing and ware washing equipment that sprays 
     water on dishes, flatware, and other food service items for 
     the purpose of removing food residue before cleaning the 
     items.
       ``(B) The Secretary may modify the definition of 
     `commercial prerinse spray valve' by rule--
       ``(i) to include products--
       ``(I) that are extensively used in conjunction with 
     commercial dishwashing and ware washing equipment;
       ``(II) the application of standards to which would result 
     in significant energy savings; and
       ``(III) the application of standards to which would meet 
     the criteria specified in section 325(o)(4); and
       ``(ii) to exclude products--
       ``(I) that are used for special food service applications;
       ``(II) that are unlikely to be widely used in conjunction 
     with commercial dishwashing and ware washing equipment; and

[[Page 17803]]

       ``(III) the application of standards to which would not 
     result in significant energy savings.
       ``(34) The term `dehumidifier' means a self-contained, 
     electrically operated, and mechanically encased assembly 
     consisting of--
       ``(A) a refrigerated surface (evaporator) that condenses 
     moisture from the atmosphere;
       ``(B) a refrigerating system, including an electric motor;
       ``(C) an air-circulating fan; and
       ``(D) means for collecting or disposing of the condensate.
       ``(35)(A) The term `distribution transformer' means a 
     transformer that--
       ``(i) has an input voltage of 34.5 kilovolts or less;
       ``(ii) has an output voltage of 600 volts or less; and
       ``(iii) is rated for operation at a frequency of 60 Hertz.
       ``(B) The term `distribution transformer' does not 
     include--
       ``(i) a transformer with multiple voltage taps, the highest 
     of which equals at least 20 percent more than the lowest;
       ``(ii) a transformer that is designed to be used in a 
     special purpose application and is unlikely to be used in 
     general purpose applications, such as a drive transformer, 
     rectifier transformer, auto-transformer, Uninterruptible 
     Power System transformer, impedance transformer, regulating 
     transformer, sealed and nonventilating transformer, machine 
     tool transformer, welding transformer, grounding transformer, 
     or testing transformer; or
       ``(iii) any transformer not listed in clause (ii) that is 
     excluded by the Secretary by rule because--
       ``(I) the transformer is designed for a special 
     application;
       ``(II) the transformer is unlikely to be used in general 
     purpose applications; and
       ``(III) the application of standards to the transformer 
     would not result in significant energy savings.
       ``(36) The term `external power supply' means an external 
     power supply circuit that is used to convert household 
     electric current into DC current or lower-voltage AC current 
     to operate a consumer product.
       ``(37) The term `illuminated exit sign' means a sign that--
       ``(A) is designed to be permanently fixed in place to 
     identify an exit; and
       ``(B) consists of an electrically powered integral light 
     source that--
       ``(i) illuminates the legend `EXIT' and any directional 
     indicators; and
       ``(ii) provides contrast between the legend, any 
     directional indicators, and the background.
       ``(38) The term `low-voltage dry-type distribution 
     transformer' means a distribution transformer that--
       ``(A) has an input voltage of 600 volts or less;
       ``(B) is air-cooled; and
       ``(C) does not use oil as a coolant.
       ``(39) The term `pedestrian module' means a light signal 
     used to convey movement information to pedestrians.
       ``(40) The term `refrigerated bottled or canned beverage 
     vending machine' means a commercial refrigerator that cools 
     bottled or canned beverages and dispenses the bottled or 
     canned beverages on payment.
       ``(41) The term `standby mode' means the lowest power 
     consumption mode, as established on an individual product 
     basis by the Secretary, that--
       ``(A) cannot be switched off or influenced by the user; and
       ``(B) may persist for an indefinite time when an appliance 
     is--
       ``(i) connected to the main electricity supply; and
       ``(ii) used in accordance with the instructions of the 
     manufacturer.
       ``(42) The term `torchiere' means a portable electric lamp 
     with a reflector bowl that directs light upward to give 
     indirect illumination.
       ``(43) The term `traffic signal module' means a standard 8-
     inch (200mm) or 12-inch (300mm) traffic signal indication 
     that--
       ``(A) consists of a light source, a lens, and all other 
     parts necessary for operation; and
       ``(B) communicates movement messages to drivers through 
     red, amber, and green colors.
       ``(44) The term `transformer' means a device consisting of 
     2 or more coils of insulated wire that transfers alternating 
     current by electromagnetic induction from 1 coil to another 
     to change the original voltage or current value.
       ``(45)(A) The term `unit heater' means a self-contained 
     fan-type heater designed to be installed within the heated 
     space.
       ``(B) The term `unit heater' does not include a warm air 
     furnace.
       ``(46)(A) The term `high intensity discharge lamp' means an 
     electric-discharge lamp in which--
       ``(i) the light-producing arc is stabilized by bulb wall 
     temperature; and
       ``(ii) the arc tube has a bulb wall loading in excess of 3 
     Watts/cm2.
       ``(B) The term `high intensity discharge lamp' includes 
     mercury vapor, metal halide, and high-pressure sodium lamps 
     described in subparagraph (A).
       ``(47)(A) The term `mercury vapor lamp' means a high 
     intensity discharge lamp in which the major portion of the 
     light is produced by radiation from mercury operating at a 
     partial pressure in excess of 100,000 Pa (approximately 1 
     atm).
       ``(B) The term `mercury vapor lamp' includes clear, 
     phosphor-coated, and self-ballasted lamps described in 
     subparagraph (A).
       ``(48) The term `mercury vapor lamp ballast' means a device 
     that is designed and marketed to start and operate mercury 
     vapor lamps by providing the necessary voltage and current.
       ``(49) The term `ceiling fan' means a nonportable device 
     that is suspended from a ceiling for circulating air via the 
     rotation of fan blades.
       ``(50) The term `ceiling fan light kit' means equipment 
     designed to provide light from a ceiling fan that can be--
       ``(A) integral, such that the equipment is attached to the 
     ceiling fan prior to the time of retail sale; or
       ``(B) attachable, such that at the time of retail sale the 
     equipment is not physically attached to the ceiling fan, but 
     may be included inside the ceiling fan at the time of sale or 
     sold separately for subsequent attachment to the fan.
       ``(51) The term `medium screw base' means an Edison screw 
     base identified with the prefix E-26 in the `American 
     National Standard for Electric Lamp Bases', ANSI_IEC C81.61--
     2003, published by the American National Standards 
     Institute.''.
       (b) Test Procedures.--Section 323 of the Energy Policy and 
     Conservation Act (42 U.S.C. 6293) is amended--
       (1) in subsection (b), by adding at the end the following:
       ``(9) Test procedures for illuminated exit signs shall be 
     based on the test method used under version 2.0 of the Energy 
     Star program of the Environmental Protection Agency for 
     illuminated exit signs.
       ``(10)(A) Test procedures for distribution transformers and 
     low voltage dry-type distribution transformers shall be based 
     on the `Standard Test Method for Measuring the Energy 
     Consumption of Distribution Transformers' prescribed by the 
     National Electrical Manufacturers Association (NEMA TP 2-
     1998).
       ``(B) The Secretary may review and revise the test 
     procedures established under subparagraph (A).
       ``(C) For purposes of section 346(a), the test procedures 
     established under subparagraph (A) shall be considered to be 
     the testing requirements prescribed by the Secretary under 
     section 346(a)(1) for distribution transformers for which the 
     Secretary makes a determination that energy conservation 
     standards would--
       ``(i) be technologically feasible and economically 
     justified; and
       ``(ii) result in significant energy savings.
       ``(11) Test procedures for traffic signal modules and 
     pedestrian modules shall be based on the test method used 
     under the Energy Star program of the Environmental Protection 
     Agency for traffic signal modules, as in effect on the date 
     of enactment of this paragraph.
       ``(12)(A) Test procedures for medium base compact 
     fluorescent lamps shall be based on the test methods for 
     compact fluorescent lamps used under the August 9, 2001, 
     version of the Energy Star program of the Environmental 
     Protection Agency and the Department of Energy.
       ``(B) Except as provided in subparagraph (C), medium base 
     compact fluorescent lamps shall meet all test requirements 
     for regulated parameters of section 325(cc).
       ``(C) Notwithstanding subparagraph (B), if manufacturers 
     document engineering predictions and analysis that support 
     expected attainment of lumen maintenance at 40 percent rated 
     life and lamp lifetime, medium base compact fluorescent lamps 
     may be marketed before completion of the testing of lamp life 
     and lumen maintenance at 40 percent of rated life.
       ``(13) Test procedures for dehumidifiers shall be based on 
     the test criteria used under the Energy Star Program 
     Requirements for Dehumidifiers developed by the Environmental 
     Protection Agency, as in effect on the date of enactment of 
     this paragraph unless revised by the Secretary pursuant to 
     this section.
       ``(14) The test procedure for measuring flow rate for 
     commercial prerinse spray valves shall be based on American 
     Society for Testing and Materials Standard F2324, entitled 
     `Standard Test Method for Pre-Rinse Spray Valves.'
       ``(15) The test procedure for refrigerated bottled or 
     canned beverage vending machines shall be based on American 
     National Standards Institute/American Society of Heating, 
     Refrigerating and Air-Conditioning Engineers Standard 32.1-
     2004, entitled `Methods of Testing for Rating Vending 
     Machines for Bottled, Canned or Other Sealed Beverages'.
       ``(16)(A)(i) Test procedures for ceiling fans shall be 
     based on the `Energy Star Testing Facility Guidance Manual: 
     Building a Testing Facility and Performing the Solid State 
     Test Method for ENERGY STAR Qualified Ceiling Fans, Version 
     1.1' published by the Environmental Protection Agency.
       ``(ii) Test procedures for ceiling fan light kits shall be 
     based on the test procedures referenced in the Energy Star 
     specifications for Residential Light Fixtures and Compact 
     Fluorescent Light Bulbs, as in effect on the date of 
     enactment of this paragraph.
       ``(B) The Secretary may review and revise the test 
     procedures established under subparagraph (A).''; and
       (2) by adding at the end the following:
       ``(f) Additional Consumer and Commercial Products.--(1) Not 
     later than 2 years after the date of enactment of this 
     subsection, the Secretary shall prescribe testing 
     requirements for refrigerated bottled or canned beverage 
     vending machines.
       ``(2) To the maximum extent practicable, the testing 
     requirements prescribed under paragraph (1) shall be based on 
     existing test procedures used in industry.''.
       (c) Standard Setting Authority.--Section 325 of the Energy 
     Policy and Conservation Act (42 U.S.C. 6295) is amended--

[[Page 17804]]

       (1) in subsection (f)(3), by adding at the end the 
     following:
       ``(D) Notwithstanding any other provision of this Act, if 
     the requirements of subsection (o) are met, the Secretary may 
     consider and prescribe energy conservation standards or 
     energy use standards for electricity used for purposes of 
     circulating air through duct work.'';
       (2) in subsection (g)--
       (A) in paragraph (6)(B), by inserting ``and labeled'' after 
     ``designed''; and
       (B) by adding at the end the following:
       ``(8)(A) Each fluorescent lamp ballast (other than 
     replacement ballasts or ballasts described in subparagraph 
     (C))--
       ``(i)(I) manufactured on or after July 1, 2009;
       ``(II) sold by the manufacturer on or after October 1, 
     2009; or
       ``(III) incorporated into a luminaire by a luminaire 
     manufacturer on or after July 1, 2010; and
       ``(ii) designed--
       ``(I) to operate at nominal input voltages of 120 or 277 
     volts;
       ``(II) to operate with an input current frequency of 60 
     Hertz; and
       ``(III) for use in connection with F34T12 lamps, F96T12/ES 
     lamps, or F96T12HO/ES lamps;

     shall have a power factor of 0.90 or greater and shall have a 
     ballast efficacy factor of not less than the following:

 
                                     Ballast       Total       Ballast
   Application for operation of       input       nominal      efficacy
                                     voltage     lamp watts     factor
 
One F34T12 lamp                        120/277           34         2.61
Two F34T12 lamps                       120/277           68         1.35
Two F96 T12/ES lamps                   120/277          120         0.77
Two F96 T12HO/ES lamps                 120/277          190        0.42.
 

       ``(B) The standards described in subparagraph (A) shall 
     apply to all ballasts covered by subparagraph (A)(ii) that 
     are manufactured on or after July 1, 2010, or sold by the 
     manufacturer on or after October 1, 2010.
       ``(C) The standards described in subparagraph (A) do not 
     apply to--
       ``(i) a ballast that is designed for dimming to 50 percent 
     or less of the maximum output of the ballast;
       ``(ii) a ballast that is designed for use with 2 F96T12HO 
     lamps at ambient temperatures of 20F or less and for use in 
     an outdoor sign; or
       ``(iii) a ballast that has a power factor of less than 0.90 
     and is designed and labeled for use only in residential 
     applications.'';
       (3) in subsection (o), by adding at the end the following:
       ``(5) The Secretary may set more than 1 energy conservation 
     standard for products that serve more than 1 major function 
     by setting 1 energy conservation standard for each major 
     function.''; and
       (4) by adding at the end the following:
       ``(u) Battery Charger and External Power Supply Electric 
     Energy Consumption.--(1)(A) Not later than 18 months after 
     the date of enactment of this subsection, the Secretary 
     shall, after providing notice and an opportunity for comment, 
     prescribe, by rule, definitions and test procedures for the 
     power use of battery chargers and external power supplies.
       ``(B) In establishing the test procedures under 
     subparagraph (A), the Secretary shall--
       ``(i) consider existing definitions and test procedures 
     used for measuring energy consumption in standby mode and 
     other modes; and
       ``(ii) assess the current and projected future market for 
     battery chargers and external power supplies.
       ``(C) The assessment under subparagraph (B)(ii) shall 
     include--
       ``(i) estimates of the significance of potential energy 
     savings from technical improvements to battery chargers and 
     external power supplies; and
       ``(ii) suggested product classes for energy conservation 
     standards.
       ``(D) Not later than 18 months after the date of enactment 
     of this subsection, the Secretary shall hold a scoping 
     workshop to discuss and receive comments on plans for 
     developing energy conservation standards for energy use for 
     battery chargers and external power supplies.
       ``(E)(i) Not later than 3 years after the date of enactment 
     of this subsection, the Secretary shall issue a final rule 
     that determines whether energy conservation standards shall 
     be issued for battery chargers and external power supplies or 
     classes of battery chargers and external power supplies.
       ``(ii) For each product class, any energy conservation 
     standards issued under clause (i) shall be set at the lowest 
     level of energy use that--
       ``(I) meets the criteria and procedures of subsections (o), 
     (p), (q), (r), (s), and (t); and
       ``(II) would result in significant overall annual energy 
     savings, considering standby mode and other operating modes.
       ``(2) In determining under section 323 whether test 
     procedures and energy conservation standards under this 
     section should be revised with respect to covered products 
     that are major sources of standby mode energy consumption, 
     the Secretary shall consider whether to incorporate standby 
     mode into the test procedures and energy conservation 
     standards, taking into account standby mode power consumption 
     compared to overall product energy consumption.
       ``(3) The Secretary shall not propose an energy 
     conservation standard under this section, unless the 
     Secretary has issued applicable test procedures for each 
     product under section 323.
       ``(4) Any energy conservation standard issued under this 
     subsection shall be applicable to products manufactured or 
     imported beginning on the date that is 3 years after the date 
     of issuance.
       ``(5) The Secretary and the Administrator shall collaborate 
     and develop programs (including programs under section 324A 
     and other voluntary industry agreements or codes of conduct) 
     that are designed to reduce standby mode energy use.
       ``(v) Ceiling Fans and Refrigerated Beverage Vending 
     Machines.--(1) Not later than 1 year after the date of 
     enactment of this subsection, the Secretary shall prescribe, 
     by rule, test procedures and energy conservation standards 
     for ceiling fans and ceiling fan light kits. If the Secretary 
     sets such standards, the Secretary shall consider exempting 
     or setting different standards for certain product classes 
     for which the primary standards are not technically feasible 
     or economically justified, and establishing separate or 
     exempted product classes for highly decorative fans for which 
     air movement performance is a secondary design feature.
       ``(2) Not later than 4 years after the date of enactment of 
     this subsection, the Secretary shall prescribe, by rule, 
     energy conservation standards for refrigerated bottle or 
     canned beverage vending machines.
       ``(3) In establishing energy conservation standards under 
     this subsection, the Secretary shall use the criteria and 
     procedures prescribed under subsections (o) and (p).
       ``(4) Any energy conservation standard prescribed under 
     this subsection shall apply to products manufactured 3 years 
     after the date of publication of a final rule establishing 
     the energy conservation standard.
       ``(w) Illuminated Exit Signs.--An illuminated exit sign 
     manufactured on or after January 1, 2006, shall meet the 
     version 2.0 Energy Star Program performance requirements for 
     illuminated exit signs prescribed by the Environmental 
     Protection Agency.
       ``(x) Torchieres.--A torchiere manufactured on or after 
     January 1, 2006--
       ``(1) shall consume not more than 190 watts of power; and
       ``(2) shall not be capable of operating with lamps that 
     total more than 190 watts.
       ``(y) Low Voltage Dry-Type Distribution Transformers.--The 
     efficiency of a low voltage dry-type distribution transformer 
     manufactured on or after January 1, 2007, shall be the Class 
     I Efficiency Levels for distribution transformers specified 
     in table 4-2 of the `Guide for Determining Energy Efficiency 
     for Distribution Transformers' published by the National 
     Electrical Manufacturers Association (NEMA TP-1-2002).
       ``(z) Traffic Signal Modules and Pedestrian Modules.--Any 
     traffic signal module or pedestrian module manufactured on or 
     after January 1, 2006, shall--
       ``(1) meet the performance requirements used under the 
     Energy Star program of the Environmental Protection Agency 
     for traffic signals, as in effect on the date of enactment of 
     this subsection; and
       ``(2) be installed with compatible, electrically connected 
     signal control interface devices and conflict monitoring 
     systems.
       ``(aa) Unit Heaters.--A unit heater manufactured on or 
     after the date that is 3 years after the date of enactment of 
     this subsection shall--
       ``(1) be equipped with an intermittent ignition device; and
       ``(2) have power venting or an automatic flue damper.
       ``(bb) Medium Base Compact Fluorescent Lamps.--(1) A bare 
     lamp and covered lamp (no reflector) medium base compact 
     fluorescent lamp manufactured on or after January 1, 2006, 
     shall meet the following requirements prescribed by the 
     August 9, 2001, version of the Energy Star Program 
     Requirements for Compact Fluorescent Lamps, Energy Star 
     Eligibility Criteria, Energy-Efficiency Specification issued 
     by the Environmental Protection Agency and Department of 
     Energy:
       ``(A) Minimum initial efficacy.
       ``(B) Lumen maintenance at 1000 hours.
       ``(C) Lumen maintenance at 40 percent of rated life.
       ``(D) Rapid cycle stress test.
       ``(E) Lamp life.
       ``(2) The Secretary may, by rule, establish requirements 
     for color quality (CRI), power factor, operating frequency, 
     and maximum allowable start time based on the requirements 
     prescribed by the August 9, 2001, version of the Energy Star 
     Program Requirements for Compact Fluorescent Lamps.
       ``(3) The Secretary may, by rule--
       ``(A) revise the requirements established under paragraph 
     (2); or
       ``(B) establish other requirements, after considering 
     energy savings, cost effectiveness, and consumer 
     satisfaction.
       ``(cc) Dehumidifiers.--(1) Dehumidifiers manufactured on or 
     after October 1, 2007, shall have an Energy Factor that meets 
     or exceeds the following values:

``Product Capacity (pints/day):      Minimum Energy Factor (Liters/kWh)
  25.00 or less...............................................1.00 ....

  25.01 - 35.00...............................................1.20 ....

  35.01 - 54.00...............................................1.30 ....

  54.01 - 74.99...............................................1.50 ....

  75.00 or more...............................................2.25.....

       ``(2)(A) Not later than October 1, 2009, the Secretary 
     shall publish a final rule in accordance with subsections (o) 
     and (p), to determine whether the energy conservation 
     standards established under paragraph (1) should be amended.

[[Page 17805]]

       ``(B) The final rule published under subparagraph (A) 
     shall--
       ``(i) contain any amendment by the Secretary; and
       ``(ii) provide that the amendment applies to products 
     manufactured on or after October 1, 2012.
       ``(C) If the Secretary does not publish an amendment that 
     takes effect by October 1, 2012, dehumidifiers manufactured 
     on or after October 1, 2012, shall have an Energy Factor that 
     meets or exceeds the following values:

``Product Capacity (pints/day):      Minimum Energy Factor (Liters/kWh)
  25.00 or less...............................................1.20 ....

  25.01 - 35.00...............................................1.30 ....

  35.01 - 45.00...............................................1.40 ....

  45.01 - 54.00...............................................1.50 ....

  54.01 - 74.99...............................................1.60 ....

  75.00 or more................................................2.5.....

       ``(dd) Commercial Prerinse Spray Valves.--Commercial 
     prerinse spray valves manufactured on or after January 1, 
     2006, shall have a flow rate of not more than 1.6 gallons per 
     minute.
       ``(ee) Mercury Vapor Lamp Ballasts.--Mercury vapor lamp 
     ballasts shall not be manufactured or imported after January 
     1, 2008.
       ``(ff) Ceiling Fans and Ceiling Fan Light Kits.--(1)(A) All 
     ceiling fans manufactured on or after January 1, 2007, shall 
     have the following features:
       ``(i) Fan speed controls separate from any lighting 
     controls.
       ``(ii) Adjustable speed controls (either more than 1 speed 
     or variable speed).
       ``(iii) Adjustable speed controls (either more than 1 speed 
     or variable speed).
       ``(iv) The capability of reversible fan action, except 
     for--
       ``(I) fans sold for industrial applications;
       ``(II) outdoor applications; and
       ``(III) cases in which safety standards would be violated 
     by the use of the reversible mode.
       ``(B) The Secretary may define the exceptions described in 
     clause (iv) in greater detail, but shall not substantively 
     expand the exceptions
       ``(2)(A) Ceiling fan light kits with medium screw base 
     sockets manufactured on or after January 1, 2007, shall be 
     packaged with screw-based lamps to fill all screw base 
     sockets.
       ``(B) The screw-based lamps required under subparagraph (A) 
     shall--
       ``(i) meet the Energy Star Program Requirements for Compact 
     Fluorescent Lamps, version 3.0, issued by the Department of 
     Energy; or
       ``(ii) use light sources other than compact fluorescent 
     lamps that have lumens per watt performance at least 
     equivalent to comparably configured compact fluorescent lamps 
     meeting the Energy Star Program Requirements described in 
     clause (i).
       ``(3) Ceiling fan light kits with pin-based sockets for 
     fluorescent lamps manufactured on or after January 1, 2007 
     shall--
       ``(A) meet the Energy Star Program Requirements for 
     Residential Light Fixtures version 4.0 issued by the 
     Environmental Protection Agency; and
       ``(B) be packaged with lamps to fill all sockets.
       ``(4)(A) By January 1, 2007, the Secretary shall consider 
     and issue requirements for any ceiling fan lighting kits 
     other than those covered in paragraphs (2) and (3), including 
     candelabra screw base sockets.
       ``(B) The requirements issued under subparagraph (A) shall 
     be effective for products manufactured 2 years after the date 
     of the final rule.
       ``(C) If the Secretary fails to issue a final rule by the 
     date specified in subparagraph (B), any type of ceiling fan 
     lighting kit described in subparagraph (A) that is 
     manufactured after January 1, 2009--
       ``(i) shall not be capable of operating with lamps that 
     total more than 190 watts; and
       ``(ii) shall include the lamps described in clause (i) in 
     the ceiling fan lighting kits.
       ``(5)(A) After January 1, 2010, the Secretary may consider, 
     and issue, if the requirements of subsections (o) and (p) are 
     met, amended energy efficiency standards for ceiling fan 
     light kits.
       ``(B) Any amended standards issued under subparagraph (A) 
     shall apply to products manufactured not earlier than 2 years 
     after the date of publication of the final rule establishing 
     the amended standard.
       ``(6)(A) Notwithstanding any other provision of this Act, 
     the Secretary may consider, and issue, if the requirements of 
     subsections (o) and (p) are met, energy efficiency or energy 
     use standards for electricity used by ceiling fans to 
     circulate air in a room.
       ``(B) In issuing the standards under subparagraph (A), the 
     Secretary shall consider--
       ``(C) exempting, or setting different standards for, 
     certain product classes for which the primary standards are 
     not technically feasible or economically justified; and
       ``(D) establishing separate exempted product classes for 
     highly decorative fans for which air movement performance is 
     a secondary design feature.
       ``(7) Section 327 shall apply to the products covered in 
     paragraphs (1) through (4) beginning on the date of enactment 
     of this subsection, except that any State or local labeling 
     requirement for ceiling fans prescribed or enacted before the 
     date of enactment of this subsection shall not be preempted 
     until the labeling requirements applicable to ceiling fans 
     established under section 327 take effect.
       ``(gg) Application Date.--Section 327 applies--
       ``(1) to products for which energy conservation standards 
     are to be established under subsection (l), (u), or (v) 
     beginning on the date on which a final rule is issued by the 
     Secretary, except that any State or local standard prescribed 
     or enacted for the product before the date on which the final 
     rule is issued shall not be preempted until the energy 
     conservation standard established under subsection (l), (u), 
     or (v) for the product takes effect; and
       ``(2) to products for which energy conservation standards 
     are established under subsections (w) through (ff) on the 
     date of enactment of those subsections, except that any State 
     or local standard prescribed or enacted before the date of 
     enactment of those subsections shall not be preempted until 
     the energy conservation standards established under 
     subsections (w) through (ff) take effect.''.
       (d) General Rule of Preemption.--Section 327(c) of the 
     Energy Policy and Conservation Act (42 U.S.C. 6297(c)) is 
     amended--
       (1) in paragraph (5), by striking ``or'' at the end;
       (2) in paragraph (6), by striking the period at the end and 
     inserting ``; or''; and
       (3) by adding at the end the following:
       ``(7)(A) is a regulation concerning standards for 
     commercial prerinse spray valves adopted by the California 
     Energy Commission before January 1, 2005; or
       ``(B) is an amendment to a regulation described in 
     subparagraph (A) that was developed to align California 
     regulations with changes in American Society for Testing and 
     Materials Standard F2324;
       ``(8)(A) is a regulation concerning standards for 
     pedestrian modules adopted by the California Energy 
     Commission before January 1, 2005; or
       ``(B) is an amendment to a regulation described in 
     subparagraph (A) that was developed to align California 
     regulations to changes in the Institute for Transportation 
     Engineers standards, entitled `Performance Specification: 
     Pedestrian Traffic Control Signal Indications'.''.

     SEC. 136. ENERGY CONSERVATION STANDARDS FOR COMMERCIAL 
                   EQUIPMENT.

       (a) Definitions.--Section 340 of the Energy Policy and 
     Conservation Act (42 U.S.C. 6311) is amended--
       (1) in paragraph (1)--
       (A) by redesignating subparagraphs (D) through (G) as 
     subparagraphs (H) through (K), respectively; and
       (B) by inserting after subparagraph (C) the following:
       ``(D) Very large commercial package air conditioning and 
     heating equipment.
       ``(E) Commercial refrigerators, freezers, and refrigerator-
     freezers.
       ``(F) Automatic commercial ice makers.
       ``(G) Commercial clothes washers.'';
       (2) in paragraph (2)(B), by striking ``small and large 
     commercial package air conditioning and heating equipment'' 
     and inserting ``commercial package air conditioning and 
     heating equipment, commercial refrigerators, freezers, and 
     refrigerator-freezers, automatic commercial ice makers, 
     commercial clothes washers'';
       (3) by striking paragraphs (8) and (9) and inserting the 
     following:
       ``(8)(A) The term `commercial package air conditioning and 
     heating equipment' means air-cooled, water-cooled, 
     evaporatively-cooled, or water source (not including ground 
     water source) electrically operated, unitary central air 
     conditioners and central air conditioning heat pumps for 
     commercial application.
       ``(B) The term `small commercial package air conditioning 
     and heating equipment' means commercial package air 
     conditioning and heating equipment that is rated below 
     135,000 Btu per hour (cooling capacity).
       ``(C) The term `large commercial package air conditioning 
     and heating equipment' means commercial package air 
     conditioning and heating equipment that is rated--
       ``(i) at or above 135,000 Btu per hour; and
       ``(ii) below 240,000 Btu per hour (cooling capacity).
       ``(D) The term `very large commercial package air 
     conditioning and heating equipment' means commercial package 
     air conditioning and heating equipment that is rated--
       ``(i) at or above 240,000 Btu per hour; and
       ``(ii) below 760,000 Btu per hour (cooling capacity).
       ``(9)(A) The term `commercial refrigerator, freezer, and 
     refrigerator-freezer' means refrigeration equipment that--
       ``(i) is not a consumer product (as defined in section 
     321);
       ``(ii) is not designed and marketed exclusively for 
     medical, scientific, or research purposes;
       ``(iii) operates at a chilled, frozen, combination chilled 
     and frozen, or variable temperature;
       ``(iv) displays or stores merchandise and other perishable 
     materials horizontally, semivertically, or vertically;
       ``(v) has transparent or solid doors, sliding or hinged 
     doors, a combination of hinged, sliding, transparent, or 
     solid doors, or no doors;
       ``(vi) is designed for pull-down temperature applications 
     or holding temperature applications; and
       ``(vii) is connected to a self-contained condensing unit or 
     to a remote condensing unit.
       ``(B) The term `holding temperature application' means a 
     use of commercial refrigeration equipment other than a pull-
     down temperature application, except a blast chiller or 
     freezer.
       ``(C) The term `integrated average temperature' means the 
     average temperature of all test package measurements taken 
     during the test.
       ``(D) The term `pull-down temperature application' means a 
     commercial refrigerator with doors that, when fully loaded 
     with 12 ounce

[[Page 17806]]

     beverage cans at 90 degrees F, can cool those beverages to an 
     average stable temperature of 38 degrees F in 12 hours or 
     less.
       ``(E) The term `remote condensing unit' means a factory-
     made assembly of refrigerating components designed to 
     compress and liquefy a specific refrigerant that is remotely 
     located from the refrigerated equipment and consists of 1 or 
     more refrigerant compressors, refrigerant condensers, 
     condenser fans and motors, and factory supplied accessories.
       ``(F) The term `self-contained condensing unit' means a 
     factory-made assembly of refrigerating components designed to 
     compress and liquefy a specific refrigerant that is an 
     integral part of the refrigerated equipment and consists of 1 
     or more refrigerant compressors, refrigerant condensers, 
     condenser fans and motors, and factory supplied 
     accessories.''; and
       (4) by adding at the end the following:
       ``(19) The term `automatic commercial ice maker' means a 
     factory-made assembly (not necessarily shipped in 1 package) 
     that--
       ``(A) consists of a condensing unit and ice-making section 
     operating as an integrated unit, with means for making and 
     harvesting ice; and
       ``(B) may include means for storing ice, dispensing ice, or 
     storing and dispensing ice.
       ``(20) The term `commercial clothes washer' means a soft-
     mount front-loading or soft-mount top-loading clothes washer 
     that--
       ``(A) has a clothes container compartment that--
       ``(i) for horizontal-axis clothes washers, is not more than 
     3.5 cubic feet; and
       ``(ii) for vertical-axis clothes washers, is not more than 
     4.0 cubic feet; and
       ``(B) is designed for use in--
       ``(i) applications in which the occupants of more than 1 
     household will be using the clothes washer, such as multi-
     family housing common areas and coin laundries; or
       ``(ii) other commercial applications.
       ``(21) The term `harvest rate' means the amount of ice (at 
     32 degrees F) in pounds produced per 24 hours.''.
       (b) Standards for Commercial Package Air Conditioning and 
     Heating Equipment.--Section 342(a) of the Energy Policy and 
     Conservation Act (42 U.S.C. 6313(a)) is amended--
       (1) in the subsection heading, by striking ``Small and 
     Large'' and inserting ``Small, Large, and Very Large'';
       (2) in paragraph (1), by inserting ``but before January 1, 
     2010,'' after ``January 1, 1994,'';
       (3) in paragraph (2), by inserting ``but before January 1, 
     2010,'' after ``January 1, 1995,''; and
       (4) in paragraph (6)--
       (A) in subparagraph (A)--
       (i) by inserting ``(i)'' after ``(A)'';
       (ii) by striking ``the date of enactment of the Energy 
     Policy Act of 1992'' and inserting ``January 1, 2010'';
       (iii) by inserting after ``large commercial package air 
     conditioning and heating equipment,'' the following: ``and 
     very large commercial package air conditioning and heating 
     equipment, or if ASHRAE/IES Standard 90.1, as in effect on 
     October 24, 1992, is amended with respect to any''; and
       (iv) by adding at the end the following:
       ``(ii) If ASHRAE/IES Standard 90.1 is not amended with 
     respect to small commercial package air conditioning and 
     heating equipment, large commercial package air conditioning 
     and heating equipment, and very large commercial package air 
     conditioning and heating equipment during the 5-year period 
     beginning on the effective date of a standard, the Secretary 
     may initiate a rulemaking to determine whether a more 
     stringent standard--
       ``(I) would result in significant additional conservation 
     of energy; and
       ``(II) is technologically feasible and economically 
     justified.''; and
       (B) in subparagraph (C)(ii), by inserting ``and very large 
     commercial package air conditioning and heating equipment'' 
     after ``large commercial package air conditioning and heating 
     equipment''; and
       (5) by adding at the end the following:
       ``(7) Small commercial package air conditioning and heating 
     equipment manufactured on or after January 1, 2010, shall 
     meet the following standards:
       ``(A) The minimum energy efficiency ratio of air-cooled 
     central air conditioners at or above 65,000 Btu per hour 
     (cooling capacity) and less than 135,000 Btu per hour 
     (cooling capacity) shall be--
       ``(i) 11.2 for equipment with no heating or electric 
     resistance heating; and
       ``(ii) 11.0 for equipment with all other heating system 
     types that are integrated into the equipment (at a standard 
     rating of 95 degrees F db).
       ``(B) The minimum energy efficiency ratio of air-cooled 
     central air conditioner heat pumps at or above 65,000 Btu per 
     hour (cooling capacity) and less than 135,000 Btu per hour 
     (cooling capacity) shall be--
       ``(i) 11.0 for equipment with no heating or electric 
     resistance heating; and
       ``(ii) 10.8 for equipment with all other heating system 
     types that are integrated into the equipment (at a standard 
     rating of 95 degrees F db).
       ``(C) The minimum coefficient of performance in the heating 
     mode of air-cooled central air conditioning heat pumps at or 
     above 65,000 Btu per hour (cooling capacity) and less than 
     135,000 Btu per hour (cooling capacity) shall be 3.3 (at a 
     high temperature rating of 47 degrees F db).
       ``(8) Large commercial package air conditioning and heating 
     equipment manufactured on or after January 1, 2010, shall 
     meet the following standards:
       ``(A) The minimum energy efficiency ratio of air-cooled 
     central air conditioners at or above 135,000 Btu per hour 
     (cooling capacity) and less than 240,000 Btu per hour 
     (cooling capacity) shall be--
       ``(i) 11.0 for equipment with no heating or electric 
     resistance heating; and
       ``(ii) 10.8 for equipment with all other heating system 
     types that are integrated into the equipment (at a standard 
     rating of 95 degrees F db).
       ``(B) The minimum energy efficiency ratio of air-cooled 
     central air conditioner heat pumps at or above 135,000 Btu 
     per hour (cooling capacity) and less than 240,000 Btu per 
     hour (cooling capacity) shall be--
       ``(i) 10.6 for equipment with no heating or electric 
     resistance heating; and
       ``(ii) 10.4 for equipment with all other heating system 
     types that are integrated into the equipment (at a standard 
     rating of 95 degrees F db).
       ``(C) The minimum coefficient of performance in the heating 
     mode of air-cooled central air conditioning heat pumps at or 
     above 135,000 Btu per hour (cooling capacity) and less than 
     240,000 Btu per hour (cooling capacity) shall be 3.2 (at a 
     high temperature rating of 47 degrees F db).
       ``(9) Very large commercial package air conditioning and 
     heating equipment manufactured on or after January 1, 2010, 
     shall meet the following standards:
       ``(A) The minimum energy efficiency ratio of air-cooled 
     central air conditioners at or above 240,000 Btu per hour 
     (cooling capacity) and less than 760,000 Btu per hour 
     (cooling capacity) shall be--
       ``(i) 10.0 for equipment with no heating or electric 
     resistance heating; and
       ``(ii) 9.8 for equipment with all other heating system 
     types that are integrated into the equipment (at a standard 
     rating of 95 degrees F db).
       ``(B) The minimum energy efficiency ratio of air-cooled 
     central air conditioner heat pumps at or above 240,000 Btu 
     per hour (cooling capacity) and less than 760,000 Btu per 
     hour (cooling capacity) shall be--
       ``(i) 9.5 for equipment with no heating or electric 
     resistance heating; and
       ``(ii) 9.3 for equipment with all other heating system 
     types that are integrated into the equipment (at a standard 
     rating of 95 degrees F db).
       ``(C) The minimum coefficient of performance in the heating 
     mode of air-cooled central air conditioning heat pumps at or 
     above 240,000 Btu per hour (cooling capacity) and less than 
     760,000 Btu per hour (cooling capacity) shall be 3.2 (at a 
     high temperature rating of 47 degrees F db).''.
       (c) Standards for Commercial Refrigerators, Freezers, and 
     Refrigerator-Freezers.--Section 342 of the Energy Policy and 
     Conservation Act (42 U.S.C. 6313) is amended by adding at the 
     end the following:
       ``(c) Commercial Refrigerators, Freezers, and Refrigerator-
     Freezers.--(1) In this subsection:
       ``(A) The term `AV' means the adjusted volume 
     (ft3) (defined as 1.63 x frozen temperature 
     compartment volume (ft3) + chilled temperature 
     compartment volume (ft3)) with compartment volumes 
     measured in accordance with the Association of Home Appliance 
     Manufacturers Standard HRF1-1979.
       ``(B) The term `V' means the chilled or frozen compartment 
     volume (ft3) (as defined in the Association of 
     Home Appliance Manufacturers Standard HRF1-1979).
       ``(C) Other terms have such meanings as may be established 
     by the Secretary, based on industry-accepted definitions and 
     practice.
       ``(2) Each commercial refrigerator, freezer, and 
     refrigerator-freezer with a self-contained condensing unit 
     designed for holding temperature applications manufactured on 
     or after January 1, 2010, shall have a daily energy 
     consumption (in kilowatt hours per day) that does not exceed 
     the following:

  Refrigerators with solid doors..........  0.10 V + 2.04
  Refrigerators with transparent doors....  0.12 V + 3.34
  Freezers with solid doors...............  0.40 V + 1.38
  Freezers with transparent doors.........  0.75 V + 4.10
  Refrigerators/freezers with solid doors   0.27 AV - 0.71 or 0.70.
   the greater of.
 

       ``(3) Each commercial refrigerator with a self-contained 
     condensing unit designed for pull-down temperature 
     applications and transparent doors manufactured on or after 
     January 1, 2010, shall have a daily energy consumption (in 
     kilowatt hours per day) of not more than 0.126 V + 3.51.
       ``(4)(A) Not later than January 1, 2009, the Secretary 
     shall issue, by rule, standard levels for ice-cream freezers, 
     self-contained commercial refrigerators, freezers, and 
     refrigerator-freezers without doors, and remote condensing 
     commercial refrigerators, freezers, and refrigerator-
     freezers, with the standard levels effective for equipment 
     manufactured on or after January 1, 2012.
       ``(B) The Secretary may issue, by rule, standard levels for 
     other types of commercial refrigerators, freezers, and 
     refrigerator-freezers not covered by paragraph (2)(A) with 
     the standard levels effective for equipment manufactured 3 or 
     more years after the date on which the final rule is 
     published.
       ``(5)(A) Not later than January 1, 2013, the Secretary 
     shall issue a final rule to determine whether the standards 
     established under this subsection should be amended.

[[Page 17807]]

       ``(B) Not later than 3 years after the effective date of 
     any amended standards under subparagraph (A) or the 
     publication of a final rule determining that the standards 
     should not be amended, the Secretary shall issue a final rule 
     to determine whether the standards established under this 
     subsection or the amended standards, as applicable, should be 
     amended.
       ``(C) If the Secretary issues a final rule under 
     subparagraph (A) or (B) establishing amended standards, the 
     final rule shall provide that the amended standards apply to 
     products manufactured on or after the date that is--
       ``(i) 3 years after the date on which the final amended 
     standard is published; or
       ``(ii) if the Secretary determines, by rule, that 3 years 
     is inadequate, not later than 5 years after the date on which 
     the final rule is published.''.
       (d) Standards for Automatic Commercial Ice Makers.--Section 
     342 of the Energy Policy and Conservation Act (42 U.S.C. 
     6313) (as amended by subsection (c)) is amended by adding at 
     the end the following:
       ``(d) Automatic Commercial Ice Makers.--(1) Each automatic 
     commercial ice maker that produces cube type ice with 
     capacities between 50 and 2500 pounds per 24-hour period when 
     tested according to the test standard established in section 
     343(a)(7) and is manufactured on or after January 1, 2010, 
     shall meet the following standard levels:

----------------------------------------------------------------------------------------------------------------
                                                                                               Maximum Condenser
         Equipment Type             Type of Cooling    Harvest Rate (lbs  Maximum Energy Use  Water Use (gal/100
                                                         ice/24 hours)     (kWh/100 lbs Ice)       lbs Ice)
----------------------------------------------------------------------------------------------------------------
Ice Making Head                   Water.............  <500..............  7.80-0.0055H......  200-0.022H
                                                     -----------------------------------------------------------
                                    ................  500 and <1436.....  5.58-0.0011H......  200-0.022H
                                                     -----------------------------------------------------------
                                    ................  1436..............  4.0...............  200-0.022H
----------------------------------------------------------------------------------------------------------------
Ice Making Head                   Air...............  <450..............  10.26-0.0086H.....  Not Applicable
                                                     -----------------------------------------------------------
                                    ................  450...............  6.89-0.0011H......  Not Applicable
----------------------------------------------------------------------------------------------------------------
Remote Condensing                 Air...............  <1000.............  8.85-0.0038H......  Not Applicable
(but not remote
compressor)
                                                     -----------------------------------------------------------
                                    ................  1000..............  5.10..............  Not Applicable
----------------------------------------------------------------------------------------------------------------
Remote Condensing                 Air...............  <934..............  8.85-0.0038H......  Not Applicable
and Remote
Compressor
                                                     -----------------------------------------------------------
                                    ................  934...............  5.3...............  Not Applicable
----------------------------------------------------------------------------------------------------------------
Self Contained                    Water.............  <200..............  11.40-0.019H......  191-0.0315H
                                                     -----------------------------------------------------------
                                    ................  200...............  7.60..............  191-0.0315H
----------------------------------------------------------------------------------------------------------------
Self Contained                    Air...............  <175..............  18.0-0.0469H......  Not Applicable
                                                     -----------------------------------------------------------
                                    ................  175...............  9.80..............  Not Applicable
----------------------------------------------------------------------------------------------------------------
H = Harvest rate in pounds per 24 hours.
Water use is for the condenser only and does not include potable water used to make ice.

       ``(2)(A) The Secretary may issue, by rule, standard levels 
     for types of automatic commercial ice makers that are not 
     covered by paragraph (1).
       ``(B) The standards established under subparagraph (A) 
     shall apply to products manufactured on or after the date 
     that is--
       ``(i) 3 years after the date on which the rule is published 
     under subparagraph (A); or
       ``(ii) if the Secretary determines, by rule, that 3 years 
     is inadequate, not later than 5 years after the date on which 
     the final rule is published.
       ``(3)(A) Not later than January 1, 2015, with respect to 
     the standards established under paragraph (1), and, with 
     respect to the standards established under paragraph (2), not 
     later than 5 years after the date on which the standards take 
     effect, the Secretary shall issue a final rule to determine 
     whether amending the applicable standards is technologically 
     feasible and economically justified.
       ``(B) Not later than 5 years after the effective date of 
     any amended standards under subparagraph (A) or the 
     publication of a final rule determining that amending the 
     standards is not technologically feasible or economically 
     justified, the Secretary shall issue a final rule to 
     determine whether amending the standards established under 
     paragraph (1) or the amended standards, as applicable, is 
     technologically feasible or economically justified.
       ``(C) If the Secretary issues a final rule under 
     subparagraph (A) or (B) establishing amended standards, the 
     final rule shall provide that the amended standards apply to 
     products manufactured on or after the date that is--
       ``(i) 3 years after the date on which the final amended 
     standard is published; or
       ``(ii) if the Secretary determines, by rule, that 3 years 
     is inadequate, not later than 5 years after the date on which 
     the final amended standard is published.
       ``(4) A final rule issued under paragraph (2) or (3) shall 
     establish standards at the maximum level that is technically 
     feasible and economically justified, as provided in 
     subsections (o) and (p) of section 325.''.
       (e) Standards for Commercial Clothes Washers.--Section 342 
     of the Energy Policy and Conservation Act (42 U.S.C. 6313) 
     (as amended by subsection (d)) is amended by adding at the 
     end the following:
       ``(e) Commercial Clothes Washers.--(1) Each commercial 
     clothes washer manufactured on or after January 1, 2007, 
     shall have--
       ``(A) a Modified Energy Factor of at least 1.26; and
       ``(B) a Water Factor of not more than 9.5.
       ``(2)(A)(i) Not later than January 1, 2010, the Secretary 
     shall publish a final rule to determine whether the standards 
     established under paragraph (1) should be amended.
       ``(ii) The rule published under clause (i) shall provide 
     that any amended standard shall apply to products 
     manufactured 3 years after the date on which the final 
     amended standard is published.
       ``(B)(i) Not later than January 1, 2015, the Secretary 
     shall publish a final rule to determine whether the standards 
     established under paragraph (1) should be amended.
       ``(ii) The rule published under clause (i) shall provide 
     that any amended standard shall apply to products 
     manufactured 3 years after the date on which the final 
     amended standard is published.''.
       (f) Test Procedures.--Section 343 of the Energy Policy and 
     Conservation Act (42 U.S.C. 6314) is amended--
       (1) in subsection (a)--
       (A) in paragraph (4)--
       (i) in subparagraph (A), by inserting ``very large 
     commercial package air conditioning and heating equipment,'' 
     after ``large commercial package air conditioning and heating 
     equipment,''; and
       (ii) in subparagraph (B), by inserting ``very large 
     commercial package air conditioning and heating equipment,'' 
     after ``large commercial package air conditioning and heating 
     equipment,''; and
       (B) by adding at the end the following:
       ``(6)(A)(i) In the case of commercial refrigerators, 
     freezers, and refrigerator-freezers, the test procedures 
     shall be--
       ``(I) the test procedures determined by the Secretary to be 
     generally accepted industry testing procedures; or
       ``(II) rating procedures developed or recognized by the 
     ASHRAE or by the American National Standards Institute.
       ``(ii) In the case of self-contained refrigerators, 
     freezers, and refrigerator-freezers to which standards are 
     applicable under paragraphs (2) and (3) of section 342(c), 
     the initial test procedures shall be the ASHRAE 117 test 
     procedure that is in effect on January 1, 2005.
       ``(B)(i) In the case of commercial refrigerators, freezers, 
     and refrigerators-freezers with doors covered by the 
     standards adopted in February

[[Page 17808]]

     2002, by the California Energy Commission, the rating 
     temperatures shall be the integrated average temperature of 
     38 degrees F ( 2 degrees F) for refrigerator 
     compartments and 0 degrees F ( 2 degrees F) for 
     freezer compartments.
       ``(C) The Secretary shall issue a rule in accordance with 
     paragraphs (2) and (3) to establish the appropriate rating 
     temperatures for the other products for which standards will 
     be established under section 342(c)(4).
       ``(D) In establishing the appropriate test temperatures 
     under this subparagraph, the Secretary shall follow the 
     procedures and meet the requirements under section 323(e).
       ``(E)(i) Not later than 180 days after the publication of 
     the new ASHRAE 117 test procedure, if the ASHRAE 117 test 
     procedure for commercial refrigerators, freezers, and 
     refrigerator-freezers is amended, the Secretary shall, by 
     rule, amend the test procedure for the product as necessary 
     to ensure that the test procedure is consistent with the 
     amended ASHRAE 117 test procedure, unless the Secretary makes 
     a determination, by rule, and supported by clear and 
     convincing evidence, that to do so would not meet the 
     requirements for test procedures under paragraphs (2) and 
     (3).
       ``(ii) If the Secretary determines that 180 days is an 
     insufficient period during which to review and adopt the 
     amended test procedure or rating procedure under clause (i), 
     the Secretary shall publish a notice in the Federal Register 
     stating the intent of the Secretary to wait not longer than 1 
     additional year before putting into effect an amended test 
     procedure or rating procedure.
       ``(F)(i) If a test procedure other than the ASHRAE 117 test 
     procedure is approved by the American National Standards 
     Institute, the Secretary shall, by rule--
       ``(I) review the relative strengths and weaknesses of the 
     new test procedure relative to the ASHRAE 117 test procedure; 
     and
       ``(II) based on that review, adopt 1 new test procedure for 
     use in the standards program.
       ``(ii) If a new test procedure is adopted under clause 
     (i)--
       ``(I) section 323(e) shall apply; and
       ``(II) subparagraph (B) shall apply to the adopted test 
     procedure.
       ``(7)(A) In the case of automatic commercial ice makers, 
     the test procedures shall be the test procedures specified in 
     Air-Conditioning and Refrigeration Institute Standard 810-
     2003, as in effect on January 1, 2005.
       ``(B)(i) If Air-Conditioning and Refrigeration Institute 
     Standard 810-2003 is amended, the Secretary shall amend the 
     test procedures established in subparagraph (A) as necessary 
     to be consistent with the amended Air-Conditioning and 
     Refrigeration Institute Standard, unless the Secretary 
     determines, by rule, published in the Federal Register and 
     supported by clear and convincing evidence, that to do so 
     would not meet the requirements for test procedures under 
     paragraphs (2) and (3).
       ``(ii) If the Secretary issues a rule under clause (i) 
     containing a determination described in clause (ii), the rule 
     may establish an amended test procedure for the product that 
     meets the requirements of paragraphs (2) and (3).
       ``(C) The Secretary shall comply with section 323(e) in 
     establishing any amended test procedure under this paragraph.
       ``(8) With respect to commercial clothes washers, the test 
     procedures shall be the same as the test procedures 
     established by the Secretary for residential clothes washers 
     under section 325(g).''; and
       (2) in subsection (d)(1), by inserting ``very large 
     commercial package air conditioning and heating equipment, 
     commercial refrigerators, freezers, and refrigerator-
     freezers, automatic commercial ice makers, commercial clothes 
     washers,'' after ``large commercial package air conditioning 
     and heating equipment,''.
       (g) Labeling.--Section 344(e) of the Energy Policy and 
     Conservation Act (42 U.S.C. 6315(e)) is amended by inserting 
     ``very large commercial package air conditioning and heating 
     equipment, commercial refrigerators, freezers, and 
     refrigerator-freezers, automatic commercial ice makers, 
     commercial clothes washers,'' after ``large commercial 
     package air conditioning and heating equipment,'' each place 
     it appears.
       (h) Administration, Penalties, Enforcement, and 
     Preemption.--Section 345 of the Energy Policy and 
     Conservation Act (42 U.S.C. 6316) is amended--
       (1) in subsection (a)--
       (A) in paragraph (7), by striking ``and'' at the end;
       (B) in paragraph (8), by striking the period at the end and 
     inserting ``; and''; and
       (C) by adding at the end the following:
       ``(9) in the case of commercial clothes washers, section 
     327(b)(1) shall be applied as if the National Appliance 
     Energy Conservation Act of 1987 was the Energy Policy Act of 
     2005.'';
       (2) in the first sentence of subsection (b)(1), by striking 
     ``part B'' and inserting ``part A''; and
       (3) by adding at the end the following:
       ``(d)(1) Except as provided in paragraphs (2) and (3), 
     section 327 shall apply with respect to very large commercial 
     package air conditioning and heating equipment to the same 
     extent and in the same manner as section 327 applies under 
     part A on the date of enactment of this subsection.
       ``(2) Any State or local standard issued before the date of 
     enactment of this subsection shall not be preempted until the 
     standards established under section 342(a)(9) take effect on 
     January 1, 2010.
       ``(e)(1)(A) Subsections (a), (b), and (d) of section 326, 
     subsections (m) through (s) of section 325, and sections 328 
     through 336 shall apply with respect to commercial 
     refrigerators, freezers, and refrigerator-freezers to the 
     same extent and in the same manner as those provisions apply 
     under part A.
       ``(B) In applying those provisions to commercial 
     refrigerators, freezers, and refrigerator-freezers, 
     paragraphs (1), (2), (3), and (4) of subsection (a) shall 
     apply.
       ``(2)(A) Section 327 shall apply to commercial 
     refrigerators, freezers, and refrigerator-freezers for which 
     standards are established under paragraphs (2) and (3) of 
     section 342(c) to the same extent and in the same manner as 
     those provisions apply under part A on the date of enactment 
     of this subsection, except that any State or local standard 
     issued before the date of enactment of this subsection shall 
     not be preempted until the standards established under 
     paragraphs (2) and (3) of section 342(c) take effect.
       ``(B) In applying section 327 in accordance with 
     subparagraph (A), paragraphs (1), (2), and (3) of subsection 
     (a) shall apply.
       ``(3)(A) Section 327 shall apply to commercial 
     refrigerators, freezers, and refrigerator-freezers for which 
     standards are established under section 342(c)(4) to the same 
     extent and in the same manner as the provisions apply under 
     part A on the date of publication of the final rule by the 
     Secretary, except that any State or local standard issued 
     before the date of publication of the final rule by the 
     Secretary shall not be preempted until the standards take 
     effect.
       ``(B) In applying section 327 in accordance with 
     subparagraph (A), paragraphs (1), (2), and (3) of subsection 
     (a) shall apply.
       ``(4)(A) If the Secretary does not issue a final rule for a 
     specific type of commercial refrigerator, freezer, or 
     refrigerator-freezer within the time frame specified in 
     section 342(c)(5), subsections (b) and (c) of section 327 
     shall not apply to that specific type of refrigerator, 
     freezer, or refrigerator-freezer for the period beginning on 
     the date that is 2 years after the scheduled date for a final 
     rule and ending on the date on which the Secretary publishes 
     a final rule covering the specific type of refrigerator, 
     freezer, or refrigerator-freezer.
       ``(B) Any State or local standard issued before the date of 
     publication of the final rule shall not be preempted until 
     the final rule takes effect.
       ``(5)(A) In the case of any commercial refrigerator, 
     freezer, or refrigerator-freezer to which standards are 
     applicable under paragraphs (2) and (3) of section 342(c), 
     the Secretary shall require manufacturers to certify, through 
     an independent, nationally recognized testing or 
     certification program, that the commercial refrigerator, 
     freezer, or refrigerator-freezer meets the applicable 
     standard.
       ``(B) The Secretary shall, to the maximum extent 
     practicable, encourage the establishment of at least 2 
     independent testing and certification programs.
       ``(C) As part of certification, information on equipment 
     energy use and interior volume shall be made available to the 
     Secretary.
       ``(f)(1)(A)(i) Except as provided in clause (ii), section 
     327 shall apply to automatic commercial ice makers for which 
     standards have been established under section 342(d)(1) to 
     the same extent and in the same manner as the section applies 
     under part A on the date of enactment of this subsection.
       ``(ii) Any State standard issued before the date of 
     enactment of this subsection shall not be preempted until the 
     standards established under section 342(d)(1) take effect.
       ``(B) In applying section 327 to the equipment under 
     subparagraph (A), paragraphs (1), (2), and (3) of subsection 
     (a) shall apply.
       ``(2)(A)(i) Except as provided in clause (ii), section 327 
     shall apply to automatic commercial ice makers for which 
     standards have been established under section 342(d)(2) to 
     the same extent and in the same manner as the section applies 
     under part A on the date of publication of the final rule by 
     the Secretary.
       ``(ii) Any State standard issued before the date of 
     publication of the final rule by the Secretary shall not be 
     preempted until the standards established under section 
     342(d)(2) take effect.
       ``(B) In applying section 327 in accordance with 
     subparagraph (A), paragraphs (1), (2), and (3) of subsection 
     (a) shall apply.
       ``(3)(A) If the Secretary does not issue a final rule for a 
     specific type of automatic commercial ice maker within the 
     time frame specified in section 342(d), subsections (b) and 
     (c) of section 327 shall no longer apply to the specific type 
     of automatic commercial ice maker for the period beginning on 
     the day after the scheduled date for a final rule and ending 
     on the date on which the Secretary publishes a final rule 
     covering the specific type of automatic commercial ice maker.
       ``(B) Any State standard issued before the publication of 
     the final rule shall not be preempted until the standards 
     established in the final rule take effect.
       ``(4)(A) The Secretary shall monitor whether manufacturers 
     are reducing harvest rates below tested values for the 
     purpose of bringing non-complying equipment into compliance.
       ``(B) If the Secretary finds that there has been a 
     substantial amount of manipulation with respect to harvest 
     rates under subparagraph (A), the Secretary shall take steps 
     to minimize the manipulation, such as requiring harvest rates 
     to be within 5 percent of tested values.
       ``(g)(1)(A) If the Secretary does not issue a final rule 
     for commercial clothes washers within the timeframe specified 
     in section 342(e)(2), subsections (b) and (c) of section 327 
     shall not apply to commercial clothes washers for the period 
     beginning on the day after the scheduled date for a final 
     rule and ending on the date on

[[Page 17809]]

     which the Secretary publishes a final rule covering 
     commercial clothes washers.
       ``(B) Any State or local standard issued before the date on 
     which the Secretary publishes a final rule shall not be 
     preempted until the standards established under section 
     342(e)(2) take effect.
       ``(2) The Secretary shall undertake an educational program 
     to inform owners of laundromats, multifamily housing, and 
     other sites where commercial clothes washers are located 
     about the new standard, including impacts on washer purchase 
     costs and options for recovering those costs through coin 
     collection.''.

     SEC. 137. ENERGY LABELING.

       (a) Rulemaking on Effectiveness of Consumer Product 
     Labeling.--Section 324(a)(2) of the Energy Policy and 
     Conservation Act (42 U.S.C. 6294(a)(2)) is amended by adding 
     at the end the following:
       ``(F)(i) Not later than 90 days after the date of enactment 
     of this subparagraph, the Commission shall initiate a 
     rulemaking to consider--
       ``(I) the effectiveness of the consumer products labeling 
     program in assisting consumers in making purchasing decisions 
     and improving energy efficiency; and
       ``(II) changes to the labeling rules (including categorical 
     labeling) that would improve the effectiveness of consumer 
     product labels.
       ``(ii) Not later than 2 years after the date of enactment 
     of this subparagraph, the Commission shall complete the 
     rulemaking initiated under clause (i).
       ``(G)(i) Not later than 18 months after the date of 
     enactment of this subparagraph, the Commission shall issue by 
     rule, in accordance with this section, labeling requirements 
     for the electricity used by ceiling fans to circulate air in 
     a room.
       ``(ii) The rule issued under clause (i) shall apply to 
     products manufactured after the later of--
       ``(I) January 1, 2009; or
       ``(II) the date that is 60 days after the final rule is 
     issued.''.
       (b) Rulemaking on Labeling for Additional Products.--
     Section 324(a) of the Energy Policy and Conservation Act (42 
     U.S.C. 6294(a)) is amended by adding at the end the 
     following:
       ``(5)(A) For covered products described in subsections (u) 
     through (ff) of section 325, after a test procedure has been 
     prescribed under section 323, the Secretary or the 
     Commission, as appropriate, may prescribe, by rule, under 
     this section labeling requirements for the products.
       ``(B) In the case of products to which TP-1 standards under 
     section 325(y) apply, labeling requirements shall be based on 
     the `Standard for the Labeling of Distribution Transformer 
     Efficiency' prescribed by the National Electrical 
     Manufacturers Association (NEMA TP-3) as in effect on the 
     date of enactment of this paragraph.
       ``(C) In the case of dehumidifiers covered under section 
     325(dd), the Commission shall not require an `Energy Guide' 
     label.''.

     SEC. 138. INTERMITTENT ESCALATOR STUDY.

       (a) In General.--The Administrator of General Services 
     shall conduct a study on the advantages and disadvantages of 
     employing intermittent escalators in the United States.
       (b) Contents.--Such study shall include an analysis of--
       (1) the energy end-cost savings derived from the use of 
     intermittent escalators;
       (2) the cost savings derived from reduced maintenance 
     requirements; and
       (3) such other issues as the Administrator considers 
     appropriate.
       (c) Report to Congress.--Not later than 1 year after the 
     date of enactment of this Act, the Administrator shall 
     transmit to Congress a report on the results of the study.
       (d) Definition.--For purpose of this section, the term 
     ``intermittent escalator'' means an escalator that remains in 
     a stationary position until it automatically operates at the 
     approach of a passenger, returning to a stationary position 
     after the passenger completes passage.

     SEC. 139. ENERGY EFFICIENT ELECTRIC AND NATURAL GAS UTILITIES 
                   STUDY.

       (a) In General.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary, in consultation with 
     the National Association of Regulatory Utility Commissioners 
     and the National Association of State Energy Officials, shall 
     conduct a study of State and regional policies that promote 
     cost-effective programs to reduce energy consumption 
     (including energy efficiency programs) that are carried out 
     by--
       (1) utilities that are subject to State regulation; and
       (2) nonregulated utilities.
       (b) Consideration.--In conducting the study under 
     subsection (a), the Secretary shall take into consideration--
       (1) performance standards for achieving energy use and 
     demand reduction targets;
       (2) funding sources, including rate surcharges;
       (3) infrastructure planning approaches (including energy 
     efficiency programs) and infrastructure improvements;
       (4) the costs and benefits of consumer education programs 
     conducted by State and local governments and local utilities 
     to increase consumer awareness of energy efficiency 
     technologies and measures; and
       (5) methods of--
       (A) removing disincentives for utilities to implement 
     energy efficiency programs;
       (B) encouraging utilities to undertake voluntary energy 
     efficiency programs; and
       (C) ensuring appropriate returns on energy efficiency 
     programs.
       (c) Report.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     a report that includes--
       (1) the findings of the study; and
       (2) any recommendations of the Secretary, including 
     recommendations on model policies to promote energy 
     efficiency programs.

     SEC. 140. ENERGY EFFICIENCY PILOT PROGRAM.

       (a) In General.--The Secretary shall establish a pilot 
     program under which the Secretary provides financial 
     assistance to at least 3, but not more than 7, States to 
     carry out pilot projects in the States for--
       (1) planning and adopting statewide programs that 
     encourage, for each year in which the pilot project is 
     carried out--
       (A) energy efficiency; and
       (B) reduction of consumption of electricity or natural gas 
     in the State by at least 0.75 percent, as compared to a 
     baseline determined by the Secretary for the period preceding 
     the implementation of the program; or
       (2) for any State that has adopted a statewide program as 
     of the date of enactment of this Act, activities that reduce 
     energy consumption in the State by expanding and improving 
     the program.
       (b) Verification.--A State that receives financial 
     assistance under subsection (a)(1) shall submit to the 
     Secretary independent verification of any energy savings 
     achieved through the statewide program.
       (c) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $5,000,000 for 
     each of fiscal years 2006 through 2010, to remain available 
     until expended.

     SEC. 141. REPORT ON FAILURE TO COMPLY WITH DEADLINES FOR NEW 
                   OR REVISED ENERGY CONSERVATION STANDARDS.

       (a) Initial Report.--The Secretary shall submit a report to 
     Congress regarding each new or revised energy conservation or 
     water use standard which the Secretary has failed to issue in 
     conformance with the deadlines established in the Energy 
     Policy and Conservation Act. Such report shall state the 
     reasons why the Secretary has failed to comply with the 
     deadline for issuances of the new or revised standard and set 
     forth the Secretary's plan for expeditiously prescribing such 
     new or revised standard. The Secretary's initial report shall 
     be submitted not later than 6 months following enactment of 
     this Act and subsequent reports shall be submitted whenever 
     the Secretary determines that additional deadlines for 
     issuance of new or revised standards have been missed.
       (b) Implementation Report.--Every 6 months following the 
     submission of a report under subsection (a) until the 
     adoption of a new or revised standard described in such 
     report, the Secretary shall submit to the Congress an 
     implementation report describing the Secretary's progress in 
     implementing the Secretary's plan or the issuance of the new 
     or revised standard.
                       Subtitle D--Public Housing

     SEC. 151. PUBLIC HOUSING CAPITAL FUND.

       Section 9 of the United States Housing Act of 1937 (42 
     U.S.C. 1437g) is amended--
       (1) in subsection (d)(1)--
       (A) in subparagraph (I), by striking ``and'' at the end;
       (B) in subparagraph (J), by striking the period at the end 
     and inserting a semicolon; and
       (C) by adding at the end the following new subparagraphs:
       ``(K) improvement of energy and water-use efficiency by 
     installing fixtures and fittings that conform to the American 
     Society of Mechanical Engineers/American National Standards 
     Institute standards A112.19.2-1998 and A112.18.1- 2000, or 
     any revision thereto, applicable at the time of installation, 
     and by increasing energy efficiency and water conservation by 
     such other means as the Secretary determines are appropriate; 
     and
       ``(L) integrated utility management and capital planning to 
     maximize energy conservation and efficiency measures.''; and
       (2) in subsection (e)(2)(C)--
       (A) by striking ``The'' and inserting the following:
       ``(i) In general.--The''; and
       (B) by adding at the end the following:
       ``(ii) Third party contracts.--Contracts described in 
     clause (i) may include contracts for equipment conversions to 
     less costly utility sources, projects with resident-paid 
     utilities, and adjustments to frozen base year consumption, 
     including systems repaired to meet applicable building and 
     safety codes and adjustments for occupancy rates increased by 
     rehabilitation.
       ``(iii) Term of contract.--The total term of a contract 
     described in clause (i) shall not exceed 20 years to allow 
     longer payback periods for retrofits, including windows, 
     heating system replacements, wall insulation, site-based 
     generation, advanced energy savings technologies, including 
     renewable energy generation, and other such retrofits.''.

     SEC. 152. ENERGY-EFFICIENT APPLIANCES.

       In purchasing appliances, a public housing agency shall 
     purchase energy-efficient appliances that are Energy Star 
     products or FEMP-designated products, as such terms are 
     defined in section 553 of the National Energy Conservation 
     Policy Act), unless the purchase of energy-efficient 
     appliances is not cost-effective to the agency.

     SEC. 153. ENERGY EFFICIENCY STANDARDS.

       Section 109 of the Cranston-Gonzalez National Affordable 
     Housing Act (42 U.S.C. 12709) is amended--
       (1) in subsection (a)--
       (A) in paragraph (1)--
       (i) by striking ``1 year after the date of the enactment of 
     the Energy Policy Act of 1992'' and inserting ``September 30, 
     2006'';

[[Page 17810]]

       (ii) in subparagraph (A), by striking ``and'' at the end;
       (iii) in subparagraph (B), by striking the period at the 
     end and inserting ``; and''; and
       (iv) by adding at the end the following:
       ``(C) rehabilitation and new construction of public and 
     assisted housing funded by HOPE VI revitalization grants 
     under section 24 of the United States Housing Act of 1937 (42 
     U.S.C. 1437v), where such standards are determined to be cost 
     effective by the Secretary of Housing and Urban 
     Development.''; and
       (B) in paragraph (2), by inserting ``, and, with respect to 
     rehabilitation and new construction of public and assisted 
     housing funded by HOPE VI revitalization grants under section 
     24 of the United States Housing Act of 1937 (42 U.S.C. 
     1437v), the 2003 International Energy Conservation Code'' 
     after ``90.1-1989')'';
       (2) in subsection (b)--
       (A) by striking ``within 1 year after the date of the 
     enactment of the Energy Policy Act of 1992'' and inserting 
     ``by September 30, 2006''; and
       (B) by inserting ``, and, with respect to rehabilitation 
     and new construction of public and assisted housing funded by 
     HOPE VI revitalization grants under section 24 of the United 
     States Housing Act of 1937 (42 U.S.C. 1437v), the 2003 
     International Energy Conservation Code'' before the period at 
     the end; and
       (3) in subsection (c)--
       (A) in the heading, by inserting ``and the International 
     Energy Conservation Code'' after ``Model Energy Code''; and
       (B) by inserting ``, or, with respect to rehabilitation and 
     new construction of public and assisted housing funded by 
     HOPE VI revitalization grants under section 24 of the United 
     States Housing Act of 1937 (42 U.S.C. 1437v), the 2003 
     International Energy Conservation Code'' after ``1989''.

     SEC. 154. ENERGY STRATEGY FOR HUD.

       The Secretary of Housing and Urban Development shall 
     develop and implement an integrated strategy to reduce 
     utility expenses through cost-effective energy conservation 
     and efficiency measures and energy efficient design and 
     construction of public and assisted housing. The energy 
     strategy shall include the development of energy reduction 
     goals and incentives for public housing agencies. The 
     Secretary shall submit a report to Congress, not later than 1 
     year after the date of the enactment of this Act, on the 
     energy strategy and the actions taken by the Department of 
     Housing and Urban Development to monitor the energy usage of 
     public housing agencies and shall submit an update every 2 
     years thereafter on progress in implementing the strategy.
                       TITLE II--RENEWABLE ENERGY
                     Subtitle A--General Provisions

     SEC. 201. ASSESSMENT OF RENEWABLE ENERGY RESOURCES.

       (a) Resource Assessment.--Not later than 6 months after the 
     date of enactment of this Act, and each year thereafter, the 
     Secretary shall review the available assessments of renewable 
     energy resources within the United States, including solar, 
     wind, biomass, ocean (including tidal, wave, current, and 
     thermal), geothermal, and hydroelectric energy resources, and 
     undertake new assessments as necessary, taking into account 
     changes in market conditions, available technologies, and 
     other relevant factors.
       (b) Contents of Reports.--Not later than 1 year after the 
     date of enactment of this Act, and each year thereafter, the 
     Secretary shall publish a report based on the assessment 
     under subsection (a). The report shall contain--
       (1) a detailed inventory describing the available amount 
     and characteristics of the renewable energy resources; and
       (2) such other information as the Secretary believes would 
     be useful in developing such renewable energy resources, 
     including descriptions of surrounding terrain, population and 
     load centers, nearby energy infrastructure, location of 
     energy and water resources, and available estimates of the 
     costs needed to develop each resource, together with an 
     identification of any barriers to providing adequate 
     transmission for remote sources of renewable energy resources 
     to current and emerging markets, recommendations for removing 
     or addressing such barriers, and ways to provide access to 
     the grid that do not unfairly disadvantage renewable or other 
     energy producers.
       (c) Authorization of Appropriations.--For the purposes of 
     this section, there are authorized to be appropriated to the 
     Secretary $10,000,000 for each of fiscal years 2006 through 
     2010.

     SEC. 202. RENEWABLE ENERGY PRODUCTION INCENTIVE.

       (a) Incentive Payments.--Section 1212(a) of the Energy 
     Policy Act of 1992 (42 U.S.C. 13317(a)) is amended--
       (1) by striking the last sentence;
       (2) by designating the first, second, and third sentences 
     as paragraphs (1), (2), and (3), respectively;
       (3) in paragraph (3) (as so designated), by striking ``and 
     which satisfies'' and all that follows through ``deems 
     necessary''; and
       (4) by adding at the end the following:
       ``(4)(A) Subject to subparagraph (B), if there are 
     insufficient appropriations to make full payments for 
     electric production from all qualified renewable energy 
     facilities for a fiscal year, the Secretary shall assign--
       ``(i) 60 percent of appropriated funds for the fiscal year 
     to facilities that use solar, wind, ocean (including tidal, 
     wave, current, and thermal), geothermal, or closed-loop 
     (dedicated energy crops) biomass technologies to generate 
     electricity; and
       ``(ii) 40 percent of appropriated funds for the fiscal year 
     to other projects.
       ``(B) After submitting to Congress an explanation of the 
     reasons for the alteration, the Secretary may alter the 
     percentage requirements of subparagraph (A).''.
       (b) Qualified Renewable Energy Facility.--Section 1212(b) 
     of the Energy Policy Act of 1992 (42 U.S.C. 13317(b)) is 
     amended--
       (1) by striking ``a State or any political'' and all that 
     follows through ``nonprofit electrical cooperative'' and 
     inserting ``a not-for-profit electric cooperative, a public 
     utility described in section 115 of the Internal Revenue Code 
     of 1986, a State, Commonwealth, territory, or possession of 
     the United States, or the District of Columbia, or a 
     political subdivision thereof, an Indian tribal government or 
     subdivision thereof, or a Native Corporation (as defined in 
     section 3 of the Alaska Native Claims Settlement Act (43 
     U.S.C. 1602)),''; and
       (2) by inserting ``landfill gas, livestock methane, ocean 
     (including tidal, wave, current, and thermal),'' after 
     ``wind, biomass,''.
       (c) Eligibility Window.--Section 1212(c) of the Energy 
     Policy Act of 1992 (42 U.S.C. 13317(c)) is amended by 
     striking ``during the 10-fiscal year period beginning with 
     the first full fiscal year occurring after the enactment of 
     this section'' and inserting ``before October 1, 2016''.
       (d) Payment Period.--Section 1212(d) of the Energy Policy 
     Act of 1992 (42 U.S.C. 13317(d)) is amended in the second 
     sentence by inserting ``, or in which the Secretary 
     determines that all necessary Federal and State 
     authorizations have been obtained to begin construction of 
     the facility'' after ``eligible for such payments''.
       (e) Amount of Payment.--Section 1212(e)(1) of the Energy 
     Policy Act of 1992 (42 U.S.C. 13317(e)(1)) is amended in the 
     first sentence by inserting ``landfill gas, livestock 
     methane, ocean (including tidal, wave, current, and 
     thermal),'' after ``wind, biomass,''.
       (f) Termination of Authority.--Section 1212(f) of the 
     Energy Policy Act of 1992 (42 U.S.C. 13317(f)) is amended by 
     striking ``the expiration of'' and all that follows through 
     ``of this section'' and inserting ``September 30, 2026''.
       (g) Authorization of Appropriations.--Section 1212 of the 
     Energy Policy Act of 1992 (42 U.S.C. 13317) is amended by 
     striking subsection (g) and inserting the following:
       ``(g) Authorization of Appropriations.--There are 
     authorized to be appropriated such sums as are necessary to 
     carry out this section for each of fiscal years 2006 through 
     2026, to remain available until expended.''.

     SEC. 203. FEDERAL PURCHASE REQUIREMENT.

       (a) Requirement.--The President, acting through the 
     Secretary, shall seek to ensure that, to the extent 
     economically feasible and technically practicable, of the 
     total amount of electric energy the Federal Government 
     consumes during any fiscal year, the following amounts shall 
     be renewable energy:
       (1) Not less than 3 percent in fiscal years 2007 through 
     2009.
       (2) Not less than 5 percent in fiscal years 2010 through 
     2012.
       (3) Not less than 7.5 percent in fiscal year 2013 and each 
     fiscal year thereafter.
       (b) Definitions.--In this section:
       (1) Biomass.--The term ``biomass'' means any lignin waste 
     material that is segregated from other waste materials and is 
     determined to be nonhazardous by the Administrator of the 
     Environmental Protection Agency and any solid, nonhazardous, 
     cellulosic material that is derived from--
       (A) any of the following forest-related resources: mill 
     residues, precommercial thinnings, slash, and brush, or 
     nonmerchantable material;
       (B) solid wood waste materials, including waste pallets, 
     crates, dunnage, manufacturing and construction wood wastes 
     (other than pressure-treated, chemically-treated, or painted 
     wood wastes), and landscape or right-of-way tree trimmings, 
     but not including municipal solid waste (garbage), gas 
     derived from the biodegradation of solid waste, or paper that 
     is commonly recycled;
       (C) agriculture wastes, including orchard tree crops, 
     vineyard, grain, legumes, sugar, and other crop by-products 
     or residues, and livestock waste nutrients; or
       (D) a plant that is grown exclusively as a fuel for the 
     production of electricity.
       (2) Renewable energy.--The term ``renewable energy'' means 
     electric energy generated from solar, wind, biomass, landfill 
     gas, ocean (including tidal, wave, current, and thermal), 
     geothermal, municipal solid waste, or new hydroelectric 
     generation capacity achieved from increased efficiency or 
     additions of new capacity at an existing hydroelectric 
     project.
       (c) Calculation.--For purposes of determining compliance 
     with the requirement of this section, the amount of renewable 
     energy shall be doubled if--
       (1) the renewable energy is produced and used on-site at a 
     Federal facility;
       (2) the renewable energy is produced on Federal lands and 
     used at a Federal facility; or
       (3) the renewable energy is produced on Indian land as 
     defined in title XXVI of the Energy Policy Act of 1992 (25 
     U.S.C. 3501 et seq.) and used at a Federal facility.
       (d) Report.--Not later than April 15, 2007, and every 2 
     years thereafter, the Secretary shall provide a report to 
     Congress on the progress of the Federal Government in meeting 
     the goals established by this section.

[[Page 17811]]



     SEC. 204. USE OF PHOTOVOLTAIC ENERGY IN PUBLIC BUILDINGS.

       (a) In General.--Subchapter VI of chapter 31 of title 40, 
     United States Code, is amended by adding at the end the 
     following:

     ``Sec. 3177. Use of photovoltaic energy in public buildings

       ``(a) Photovoltaic Energy Commercialization Program.--
       ``(1) In general.--The Administrator of General Services 
     may establish a photovoltaic energy commercialization program 
     for the procurement and installation of photovoltaic solar 
     electric systems for electric production in new and existing 
     public buildings.
       ``(2) Purposes.--The purposes of the program shall be to 
     accomplish the following:
       ``(A) To accelerate the growth of a commercially viable 
     photovoltaic industry to make this energy system available to 
     the general public as an option which can reduce the national 
     consumption of fossil fuel.
       ``(B) To reduce the fossil fuel consumption and costs of 
     the Federal Government.
       ``(C) To attain the goal of installing solar energy systems 
     in 20,000 Federal buildings by 2010, as contained in the 
     Federal Government's Million Solar Roof Initiative of 1997.
       ``(D) To stimulate the general use within the Federal 
     Government of life-cycle costing and innovative procurement 
     methods.
       ``(E) To develop program performance data to support policy 
     decisions on future incentive programs with respect to 
     energy.
       ``(3) Acquisition of photovoltaic solar electric systems.--
       ``(A) In general.--The program shall provide for the 
     acquisition of photovoltaic solar electric systems and 
     associated storage capability for use in public buildings.
       ``(B) Acquisition levels.--The acquisition of photovoltaic 
     electric systems shall be at a level substantial enough to 
     allow use of low-cost production techniques with at least 150 
     megawatts (peak) cumulative acquired during the 5 years of 
     the program.
       ``(4) Administration.--The Administrator shall administer 
     the program and shall--
       ``(A) issue such rules and regulations as may be 
     appropriate to monitor and assess the performance and 
     operation of photovoltaic solar electric systems installed 
     pursuant to this subsection;
       ``(B) develop innovative procurement strategies for the 
     acquisition of such systems; and
       ``(C) transmit to Congress an annual report on the results 
     of the program.
       ``(b) Photovoltaic Systems Evaluation Program.--
       ``(1) In general.--Not later than 60 days after the date of 
     enactment of this section, the Administrator shall establish 
     a photovoltaic solar energy systems evaluation program to 
     evaluate such photovoltaic solar energy systems as are 
     required in public buildings.
       ``(2) Program requirement.--In evaluating photovoltaic 
     solar energy systems under the program, the Administrator 
     shall ensure that such systems reflect the most advanced 
     technology.
       ``(c) Authorization of Appropriations.--
       ``(1) Photovoltaic energy commercialization program.--There 
     are authorized to be appropriated to carry out subsection (a) 
     $50,000,000 for each of fiscal years 2006 through 2010. Such 
     sums shall remain available until expended.
       ``(2) Photovoltaic systems evaluation program.--There are 
     authorized to be appropriated to carry out subsection (b) 
     $10,000,000 for each of fiscal years 2006 through 2010. Such 
     sums shall remain available until expended.''.
       (b) Conforming Amendment.--The table of sections for the 
     National Energy Conservation Policy Act is amended by 
     inserting after the item relating to section 569 the 
     following:

``Sec. 570. Use of photovoltaic energy in public buildings''.

     SEC. 205. BIOBASED PRODUCTS.

       Section 9002(c)(1) of the Farm Security and Rural 
     Investment Act of 2002 (7 U.S.C. 8102(c)(1)) is amended by 
     inserting ``or such items that comply with the regulations 
     issued under section 103 of Public Law 100-556 (42 U.S.C. 
     6914b-1)'' after ``practicable''.

     SEC. 206. RENEWABLE ENERGY SECURITY.

       (a) Weatherization Assistance.--Section 415(c) of the 
     Energy Conservation and Production Act (42 U.S.C. 6865(c)) is 
     amended--
       (1) in paragraph (1), by striking ``in paragraph (3)'' and 
     inserting ``in paragraphs (3) and (4)'';
       (2) in paragraph (3), by striking ``$2,500 per dwelling 
     unit average provided in paragraph (1)'' and inserting 
     ``dwelling unit averages provided in paragraphs (1) and 
     (4)''; and
       (3) by adding at the end the following new paragraphs:
       ``(4) The expenditure of financial assistance provided 
     under this part for labor, weatherization materials, and 
     related matters for a renewable energy system shall not 
     exceed an average of $3,000 per dwelling unit.
       ``(5)(A) The Secretary shall by regulations--
       ``(i) establish the criteria which are to be used in 
     prescribing performance and quality standards under paragraph 
     (6)(A)(ii) or in specifying any form of renewable energy 
     under paragraph (6)(A)(i)(I); and
       ``(ii) establish a procedure under which a manufacturer of 
     an item may request the Secretary to certify that the item 
     will be treated, for purposes of this paragraph, as a 
     renewable energy system.
       ``(B) The Secretary shall make a final determination with 
     respect to any request filed under subparagraph (A)(ii) 
     within 1 year after the filing of the request, together with 
     any information required to be filed with such request under 
     subparagraph (A)(ii).
       ``(C) Each month the Secretary shall publish a report of 
     any request under subparagraph (A)(ii) which has been denied 
     during the preceding month and the reasons for the denial.
       ``(D) The Secretary shall not specify any form of renewable 
     energy under paragraph (6)(A)(i)(I) unless the Secretary 
     determines that--
       ``(i) there will be a reduction in oil or natural gas 
     consumption as a result of such specification;
       ``(ii) such specification will not result in an increased 
     use of any item which is known to be, or reasonably suspected 
     to be, environmentally hazardous or a threat to public health 
     or safety; and
       ``(iii) available Federal subsidies do not make such 
     specification unnecessary or inappropriate (in the light of 
     the most advantageous allocation of economic resources).
       ``(6) In this subsection--
       ``(A) the term `renewable energy system' means a system 
     which--
       ``(i) when installed in connection with a dwelling, 
     transmits or uses--
       ``(I) solar energy, energy derived from the geothermal 
     deposits, energy derived from biomass, or any other form of 
     renewable energy which the Secretary specifies by 
     regulations, for the purpose of heating or cooling such 
     dwelling or providing hot water or electricity for use within 
     such dwelling; or
       ``(II) wind energy for nonbusiness residential purposes;
       ``(ii) meets the performance and quality standards (if any) 
     which have been prescribed by the Secretary by regulations;
       ``(iii) in the case of a combustion rated system, has a 
     thermal efficiency rating of at least 75 percent; and
       ``(iv) in the case of a solar system, has a thermal 
     efficiency rating of at least 15 percent; and
       ``(B) the term `biomass' means any organic matter that is 
     available on a renewable or recurring basis, including 
     agricultural crops and trees, wood and wood wastes and 
     residues, plants (including aquatic plants), grasses, 
     residues, fibers, and animal wastes, municipal wastes, and 
     other waste materials.''.
       (b) District Heating and Cooling Programs.--Section 172 of 
     the Energy Policy Act of 1992 (42 U.S.C. 13451 note) is 
     amended--
       (1) in subsection (a)--
       (A) by striking ``and'' at the end of paragraph (3);
       (B) by striking the period at the end of paragraph (4) and 
     inserting ``; and''; and
       (C) by adding at the end the following new paragraph:
       ``(5) evaluate the use of renewable energy systems (as such 
     term is defined in section 415(c) of the Energy Conservation 
     and Production Act (42 U.S.C. 6865(c))) in residential 
     buildings.''; and
       (2) in subsection (b), by striking ``this Act'' and 
     inserting ``the Energy Policy Act of 2005''.
       (c) Rebate Program.--
       (1) Establishment.--The Secretary shall establish a program 
     providing rebates for consumers for expenditures made for the 
     installation of a renewable energy system in connection with 
     a dwelling unit or small business.
       (2) Amount of rebate.--Rebates provided under the program 
     established under paragraph (1) shall be in an amount not to 
     exceed the lesser of--
       (A) 25 percent of the expenditures described in paragraph 
     (1) made by the consumer; or
       (B) $3,000.
       (3) Definition.--For purposes of this subsection, the term 
     ``renewable energy system'' has the meaning given that term 
     in section 415(c)(6)(A) of the Energy Conservation and 
     Production Act (42 U.S.C. 6865(c)(6)(A)), as added by 
     subsection (a)(3) of this section.
       (4) Authorization of appropriations.--There are authorized 
     to be appropriated to the Secretary for carrying out this 
     subsection, to remain available until expended--
       (A) $150,000,000 for fiscal year 2006;
       (B) $150,000,000 for fiscal year 2007;
       (C) $200,000,000 for fiscal year 2008;
       (D) $250,000,000 for fiscal year 2009; and
       (E) $250,000,000 for fiscal year 2010.
       (d) Renewable Fuel Inventory.--Not later than 180 days 
     after the date of enactment of this Act, the Secretary shall 
     transmit to Congress a report containing--
       (1) an inventory of renewable fuels available for 
     consumers; and
       (2) a projection of future inventories of renewable fuels 
     based on the incentives provided in this section.

     SEC. 207. INSTALLATION OF PHOTOVOLTAIC SYSTEM.

       There is authorized to be appropriated to the General 
     Services Administration to install a photovoltaic system, as 
     set forth in the Sun Wall Design Project, for the 
     headquarters building of the Department of Energy located at 
     1000 Independence Avenue Southwest in the District of 
     Columbia, commonly know as the Forrestal Building, 
     $20,000,000 for fiscal year 2006. Such sums shall remain 
     available until expended.

     SEC. 208. SUGAR CANE ETHANOL PROGRAM.

       (a) Definition of Program.--In this section, the term 
     ``program'' means the Sugar Cane Ethanol Program established 
     by subsection (b).
       (b) Establishment.--There is established within the 
     Environmental Protection Agency a program to be known as the 
     ``Sugar Cane Ethanol Program''.
       (c) Project.--
       (1) In general.--Subject to the availability of 
     appropriations under subsection (d), in carrying

[[Page 17812]]

     out the program, the Administrator of the Environmental 
     Protection Agency shall establish a project that is--
       (A) carried out in multiple States--
       (i) in each of which is produced cane sugar that is 
     eligible for loans under section 156 of the Federal 
     Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 
     7272), or a similar subsequent authority; and
       (ii) at the option of each such State, that have an 
     incentive program that requires the use of ethanol in the 
     State; and
       (B) designed to study the production of ethanol from cane 
     sugar, sugarcane, and sugarcane byproducts.
       (2) Requirements.--A project described in paragraph (1) 
     shall--
       (A) be limited to sugar producers and the production of 
     ethanol in the States of Florida, Louisiana, Texas, and 
     Hawaii, divided equally among the States, to demonstrate that 
     the process may be applicable to cane sugar, sugarcane, and 
     sugarcane byproducts;
       (B) include information on the ways in which the scale of 
     production may be replicated once the sugar cane industry has 
     located sites for, and constructed, ethanol production 
     facilities; and
       (C) not last more than 3 years.
       (d) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $36,000,000, to 
     remain available until expended.

     SEC. 209. RURAL AND REMOTE COMMUNITY ELECTRIFICATION GRANTS.

       The Public Utility Regulatory Policies Act of 1978 (16 
     U.S.C. 2601 et seq.) is amended in title VI by adding at the 
     end the following:

     ``SEC. 609. RURAL AND REMOTE COMMUNITIES ELECTRIFICATION 
                   GRANTS.

       ``(a) Definitions.--In this section:
       ``(1) The term `eligible grantee' means a local government 
     or municipality, peoples' utility district, irrigation 
     district, and cooperative, nonprofit, or limited-dividend 
     association in a rural area.
       ``(2) The term `incremental hydropower' means additional 
     generation achieved from increased efficiency after January 
     1, 2005, at a hydroelectric dam that was placed in service 
     before January 1, 2005.
       ``(3) The term `renewable energy' means electricity 
     generated from--
       ``(A) a renewable energy source; or
       ``(B) hydrogen, other than hydrogen produced from a fossil 
     fuel, that is produced from a renewable energy source.
       ``(4) The term `renewable energy source' means--
       ``(A) wind;
       ``(B) ocean waves;
       ``(C) biomass;
       ``(D) solar
       ``(E) landfill gas;
       ``(F) incremental hydropower;
       ``(G) livestock methane; or
       ``(H) geothermal energy.
       ``(5) The term `rural area' means a city, town, or 
     unincorporated area that has a population of not more than 
     10,000 inhabitants.
       ``(b) Grants.--The Secretary, in consultation with the 
     Secretary of Agriculture and the Secretary of the Interior, 
     may provide grants under this section to eligible grantees 
     for the purpose of--
       ``(1) increasing energy efficiency, siting or upgrading 
     transmission and distribution lines serving rural areas,; or
       ``(2) providing or modernizing electric generation 
     facilities that serve rural areas.
       ``(c) Grant Administration.--(1) The Secretary shall make 
     grants under this section based on a determination of cost-
     effectiveness and the most effective use of the funds to 
     achieve the purposes described in subsection (b).
       ``(2) For each fiscal year, the Secretary shall allocate 
     grant funds under this section equally between the purposes 
     described in paragraphs (1) and (2) of subsection (b).
       ``(3) In making grants for the purposes described in 
     subsection (b)(2), the Secretary shall give preference to 
     renewable energy facilities.
       ``(d) Authorization of Appropriations.--There is authorized 
     to be appropriated to the Secretary to carry out this section 
     $20,000,000 for each of fiscal years 2006 through 2012.''.

     SEC. 210. GRANTS TO IMPROVE THE COMMERCIAL VALUE OF FOREST 
                   BIOMASS FOR ELECTRIC ENERGY, USEFUL HEAT, 
                   TRANSPORTATION FUELS, AND OTHER COMMERCIAL 
                   PURPOSES.

       (a) Definitions.--In this section:
       (1) Biomass.--The term ``biomass'' means nonmerchantable 
     materials or precommercial thinnings that are byproducts of 
     preventive treatments, such as trees, wood, brush, thinnings, 
     chips, and slash, that are removed--
       (A) to reduce hazardous fuels;
       (B) to reduce or contain disease or insect infestation; or
       (C) to restore forest health.
       (2) Indian tribe.--The term ``Indian tribe'' has the 
     meaning given the term in section 4(e) of the Indian Self-
     Determination and Education Assistance Act (25 U.S.C. 
     450b(e)).
       (3) Nonmerchantable.--For purposes of subsection (b), the 
     term ``nonmerchantable'' means that portion of the byproducts 
     of preventive treatments that would not otherwise be used for 
     higher value products.
       (4) Person.--The term ``person'' includes--
       (A) an individual;
       (B) a community (as determined by the Secretary concerned);
       (C) an Indian tribe;
       (D) a small business or a corporation that is incorporated 
     in the United States; and
       (E) a nonprofit organization.
       (5) Preferred community.--The term ``preferred community'' 
     means--
       (A) any Indian tribe;
       (B) any town, township, municipality, or other similar unit 
     of local government (as determined by the Secretary 
     concerned) that--
       (i) has a population of not more than 50,000 individuals; 
     and
       (ii) the Secretary concerned, in the sole discretion of the 
     Secretary concerned, determines contains or is located near 
     Federal or Indian land, the condition of which is at 
     significant risk of catastrophic wildfire, disease, or insect 
     infestation or which suffers from disease or insect 
     infestation; or
       (C) any county that--
       (i) is not contained within a metropolitan statistical 
     area; and
       (ii) the Secretary concerned, in the sole discretion of the 
     Secretary concerned, determines contains or is located near 
     Federal or Indian land, the condition of which is at 
     significant risk of catastrophic wildfire, disease, or insect 
     infestation or which suffers from disease or insect 
     infestation.
       (6) Secretary concerned.--The term ``Secretary concerned'' 
     means the Secretary of Agriculture or the Secretary of the 
     Interior.
       (b) Biomass Commercial Use Grant Program.--
       (1) In general.--The Secretary concerned may make grants to 
     any person in a preferred community that owns or operates a 
     facility that uses biomass as a raw material to produce 
     electric energy, sensible heat, or transportation fuels to 
     offset the costs incurred to purchase biomass for use by such 
     facility.
       (2) Grant amounts.--A grant under this subsection may not 
     exceed $20 per green ton of biomass delivered.
       (3) Monitoring of grant recipient activities.--As a 
     condition of a grant under this subsection, the grant 
     recipient shall keep such records as the Secretary concerned 
     may require to fully and correctly disclose the use of the 
     grant funds and all transactions involved in the purchase of 
     biomass. Upon notice by a representative of the Secretary 
     concerned, the grant recipient shall afford the 
     representative reasonable access to the facility that 
     purchases or uses biomass and an opportunity to examine the 
     inventory and records of the facility.
       (c) Improved Biomass Use Grant Program.--
       (1) In general.--The Secretary concerned may make grants to 
     persons to offset the cost of projects to develop or research 
     opportunities to improve the use of, or add value to, 
     biomass. In making such grants, the Secretary concerned shall 
     give preference to persons in preferred communities.
       (2) Selection.--The Secretary concerned shall select a 
     grant recipient under paragraph (1) after giving 
     consideration to--
       (A) the anticipated public benefits of the project, 
     including the potential to develop thermal or electric energy 
     resources or affordable energy;
       (B) opportunities for the creation or expansion of small 
     businesses and micro-businesses;
       (C) the potential for new job creation;
       (D) the potential for the project to improve efficiency or 
     develop cleaner technologies for biomass utilization; and
       (E) the potential for the project to reduce the hazardous 
     fuels from the areas in greatest need of treatment.
       (3) Grant amount.--A grant under this subsection may not 
     exceed $500,000.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated $50,000,000 for each of the fiscal years 
     2006 through 2016 to carry out this section.
       (e) Report.--Not later than October 1, 2010, the Secretary 
     of Agriculture, in consultation with the Secretary of the 
     Interior, shall submit to the Committee on Energy and Natural 
     Resources and the Committee on Agriculture, Nutrition, and 
     Forestry of the Senate, and the Committee on Resources, the 
     Committee on Energy and Commerce, and the Committee on 
     Agriculture of the House of Representatives, a report 
     describing the results of the grant programs authorized by 
     this section. The report shall include the following:
       (1) An identification of the size, type, and use of biomass 
     by persons that receive grants under this section.
       (2) The distance between the land from which the biomass 
     was removed and the facility that used the biomass.
       (3) The economic impacts, particularly new job creation, 
     resulting from the grants to and operation of the eligible 
     operations.

     SEC. 211. SENSE OF CONGRESS REGARDING GENERATION CAPACITY OF 
                   ELECTRICITY FROM RENEWABLE ENERGY RESOURCES ON 
                   PUBLIC LANDS.

       It is the sense of the Congress that the Secretary of the 
     Interior should, before the end of the 10-year period 
     beginning on the date of enactment of this Act, seek to have 
     approved non-hydropower renewable energy projects located on 
     the public lands with a generation capacity of at least 
     10,000 megawatts of electricity.
                     Subtitle B--Geothermal Energy

     SEC. 221. SHORT TITLE.

       This subtitle may be cited as the ``John Rishel Geothermal 
     Steam Act Amendments of 2005''.

     SEC. 222. COMPETITIVE LEASE SALE REQUIREMENTS.

       Section 4 of the Geothermal Steam Act of 1970 (30 U.S.C. 
     1003) is amended to read as follows:

     ``SEC. 4. LEASING PROCEDURES.

       ``(a) Nominations.--The Secretary shall accept nominations 
     of land to be leased at any

[[Page 17813]]

     time from qualified companies and individuals under this Act.
       ``(b) Competitive Lease Sale Required.--
       ``(1) In general.--Except as otherwise specifically 
     provided by this Act, all land to be leased that is not 
     subject to leasing under subsection (c) shall be leased as 
     provided in this subsection to the highest responsible 
     qualified bidder, as determined by the Secretary.
       ``(2) Competitive lease sales.--The Secretary shall hold a 
     competitive lease sale at least once every 2 years for land 
     in a State that has nominations pending under subsection (a) 
     if the land is otherwise available for leasing.
       ``(3) Lands subject to mining claims.--Lands that are 
     subject to a mining claim for which a plan of operations has 
     been approved by the relevant Federal land management agency 
     may be available for noncompetitive leasing under this 
     section to the mining claim holder.
       ``(c) Noncompetitive Leasing.--The Secretary shall make 
     available for a period of 2 years for noncompetitive leasing 
     any tract for which a competitive lease sale is held, but for 
     which the Secretary does not receive any bids in a 
     competitive lease sale.
       ``(d) Pending Lease Applications.--
       ``(1) In general.--It shall be a priority for the 
     Secretary, and for the Secretary of Agriculture with respect 
     to National Forest Systems land, to ensure timely completion 
     of administrative actions, including amendments to applicable 
     forest plans and resource management plans, necessary to 
     process applications for geothermal leasing pending on the 
     date of enactment of this subsection. All future forest plans 
     and resource management plans for areas with high geothermal 
     resource potential shall consider geothermal leasing and 
     development.
       ``(2) Administration.--An application described in 
     paragraph (1) and any lease issued pursuant to the 
     application--
       ``(A) except as provided in subparagraph (B), shall be 
     subject to this section as in effect on the day before the 
     date of enactment of this paragraph; or
       ``(B) at the election of the applicant, shall be subject to 
     this section as in effect on the effective date of this 
     paragraph.
       ``(e) Leases Sold as a Block.--If information is available 
     to the Secretary indicating a geothermal resource that could 
     be produced as 1 unit can reasonably be expected to underlie 
     more than 1 parcel to be offered in a competitive lease sale, 
     the parcels for such a resource may be offered for bidding as 
     a block in the competitive lease sale.''.

     SEC. 223. DIRECT USE.

       (a) Fees for Direct Use.--Section 5 of the Geothermal Steam 
     Act of 1970 (30 U.S.C. 1004) is amended--
       (1) in subsection (c), by redesignating paragraphs (1) and 
     (2) as subparagraphs (A) and (B), respectively;
       (2) by redesignating subsections (a) through (d) as 
     paragraphs (1) through (4), respectively;
       (3) by inserting ``(a) In General.--'' after ``SEC. 5.''; 
     and
       (4) by adding at the end the following:
       ``(b) Direct Use.--
       ``(1) In general.--Notwithstanding subsection (a)(1), the 
     Secretary shall establish a schedule of fees, in lieu of 
     royalties for geothermal resources, that a lessee or its 
     affiliate--
       ``(A) uses for a purpose other than the commercial 
     generation of electricity; and
       ``(B) does not sell.
       ``(2) Schedule of fees.--The schedule of fees--
       ``(A) may be based on the quantity or thermal content, or 
     both, of geothermal resources used;
       ``(B) shall ensure a fair return to the United States for 
     use of the resource; and
       ``(C) shall encourage development of the resource.
       ``(3) State, tribal, or local governments.--If a State, 
     tribal, or local government is the lessee and uses geothermal 
     resources without sale and for public purposes other than 
     commercial generation of electricity, the Secretary shall 
     charge only a nominal fee for use of the resource.
       ``(4) Final regulation.--In issuing any final regulation 
     establishing a schedule of fees under this subsection, the 
     Secretary shall seek--
       ``(A) to provide lessees with a simplified administrative 
     system;
       ``(B) to facilitate development of direct use of geothermal 
     resources; and
       ``(C) to contribute to sustainable economic development 
     opportunities in the area.''.
       (b) Leasing for Direct Use.--Section 4 of the Geothermal 
     Steam Act of 1970 (30 U.S.C. 1003) (as amended by section 
     222) is further amended by adding at the end the following:
       ``(f) Leasing for Direct Use of Geothermal Resources.--
     Notwithstanding subsection (b), the Secretary may identify 
     areas in which the land to be leased under this Act 
     exclusively for direct use of geothermal resources, without 
     sale for purposes other than commercial generation of 
     electricity, may be leased to any qualified applicant that 
     first applies for such a lease under regulations issued by 
     the Secretary, if the Secretary--
       ``(1) publishes a notice of the land proposed for leasing 
     not later than 90 days before the date of the issuance of the 
     lease;
       ``(2) does not receive during the 90-day period beginning 
     on the date of the publication any nomination to include the 
     land concerned in the next competitive lease sale; and
       ``(3) determines there is no competitive interest in the 
     geothermal resources in the land to be leased.
       ``(g) Area Subject to Lease for Direct Use.--
       ``(1) In general.--Subject to paragraph (2), a geothermal 
     lease for the direct use of geothermal resources shall cover 
     not more than the quantity of acreage determined by the 
     Secretary to be reasonably necessary for the proposed use.
       ``(2) Limitations.--The quantity of acreage covered by the 
     lease shall not exceed the limitations established under 
     section 7.''.
       (c) Application of New Lease Terms.--The schedule of fees 
     established under the amendment made by subsection (a)(4) 
     shall apply with respect to payments under a lease converted 
     under this subsection that are due and owing, and have been 
     paid, on or after July 16, 2003. This subsection shall not 
     require the refund of royalties paid to a state under section 
     20 of the Geothermal Steam Act of 1970 (30 U.S.C. 1019) prior 
     to the date of enactment of this Act.

     SEC. 224. ROYALTIES AND NEAR-TERM PRODUCTION INCENTIVES.

       (a) Royalty.--Section 5 of the Geothermal Steam Act of 1970 
     (30 U.S.C. 1004) is further amended--
       (1) in subsection (a) by striking paragraph (1) and 
     inserting the following:
       ``(1) a royalty on electricity produced using geothermal 
     resources, other than direct use of geothermal resources, 
     that shall be--
       ``(A) not less than 1 percent and not more than 2.5 percent 
     of the gross proceeds from the sale of electricity produced 
     from such resources during the first 10 years of production 
     under the lease; and
       ``(B) not less than 2 and not more than 5 percent of the 
     gross proceeds from the sale of electricity produced from 
     such resources during each year after such 10-year period;''; 
     and
       (2) by adding at the end the following:
       ``(c) Final Regulation Establishing Royalty Rates.--In 
     issuing any final regulation establishing royalty rates under 
     this section, the Secretary shall seek--
       ``(1) to provide lessees a simplified administrative 
     system;
       ``(2) to encourage new development; and
       ``(3) to achieve the same level of royalty revenues over a 
     10-year period as the regulation in effect on the date of 
     enactment of this subsection.
       ``(d) Credits for In-Kind Payments of Electricity.--The 
     Secretary may provide to a lessee a credit against royalties 
     owed under this Act, in an amount equal to the value of 
     electricity provided under contract to a State or county 
     government that is entitled to a portion of such royalties 
     under section 20 of this Act, section 35 of the Mineral 
     Leasing Act (30 U.S.C. 191), except as otherwise provided by 
     this section, or section 6 of the Mineral Leasing Act for 
     Acquired Lands (30 U.S.C. 355), if--
       ``(1) the Secretary has approved in advance the contract 
     between the lessee and the State or county government for 
     such in-kind payments;
       ``(2) the contract establishes a specific methodology to 
     determine the value of such credits; and
       ``(3) the maximum credit will be equal to the royalty value 
     owed to the State or county that is a party to the contract 
     and the electricity received will serve as the royalty 
     payment from the Federal Government to that entity.''.
       (b) Disposal of Moneys From Sales, Bonuses, Royalties, and 
     Rents.--Section 20 of the Geothermal Steam Act of 1970 (30 
     U.S.C. 1019) is amended to read as follows:

     ``SEC. 20. DISPOSAL OF MONEYS FROM SALES, BONUSES, RENTALS, 
                   AND ROYALTIES.

       ``(a) In General.--Except with respect to lands in the 
     State of Alaska, all monies received by the United States 
     from sales, bonuses, rentals, and royalties under this Act 
     shall be paid into the Treasury of the United States. Of 
     amounts deposited under this subsection, subject to the 
     provisions of subsection (b) of section 35 of the Mineral 
     Leasing Act (30 U.S.C. 191(b)) and section 5(a)(2) of this 
     Act--
       ``(1) 50 percent shall be paid to the State within the 
     boundaries of which the leased lands or geothermal resources 
     are or were located; and
       ``(2) 25 percent shall be paid to the County within the 
     boundaries of which the leased lands or geothermal resources 
     are or were located.
       ``(b) Use of Payments.--Amounts paid to a State or county 
     under subsection (a) shall be used consistent with the terms 
     of section 35 of the Mineral Leasing Act (30 U.S.C. 191).''.
       (c) Near-Term Production Incentive for Existing Leases.--
       (1) In general.--Notwithstanding section 5(a) of the 
     Geothermal Steam Act of 1970, the royalty required to be paid 
     shall be 50 percent of the amount of the royalty otherwise 
     required, on any lease issued before the date of enactment of 
     this Act that does not convert to new royalty terms under 
     subsection (e)--
       (A) with respect to commercial production of energy from a 
     facility that begins such production in the 6-year period 
     beginning on the date of enactment of this Act; or
       (B) on qualified expansion geothermal energy.
       (2) 4-year application.--Paragraph (1) applies only to new 
     commercial production of energy from a facility in the first 
     4 years of such production.
       (d) Definition of Qualified Expansion Geothermal Energy.--
     In this section, the term ``qualified expansion geothermal 
     energy'' means geothermal energy produced from a generation 
     facility for which--
       (1) the production is increased by more than 10 percent as 
     a result of expansion of the facility carried out in the 6-
     year period beginning on the date of enactment of this Act; 
     and
       (2) such production increase is greater than 10 percent of 
     the average production by the facility during the 5-year 
     period preceding the expansion of the facility (as such 
     average is adjusted

[[Page 17814]]

     to reflect any trend in changes in production during that 
     period).
       (e) Royalty Under Existing Leases.--
       (1) In general.--Any lessee under a lease issued under the 
     Geothermal Steam Act of 1970 (30 U.S.C. 1001 et seq.) before 
     the date of enactment of this Act may, within the time period 
     specified in paragraph (2), submit to the Secretary of the 
     Interior a request to modify the terms of the lease relating 
     to payment of royalties to provide--
       (A) in the case of a lease that meets the requirements of 
     subsection (b) of section 5 of the Geothermal Steam Act of 
     1970 (30 U.S.C. 1004) (as amended by section 223), that 
     royalties be based on the schedule of fees established under 
     that section; and
       (B) in the case of any other lease, that royalties be 
     computed on a percentage of the gross proceeds from the sale 
     of electricity, at a royalty rate that is expected to yield 
     total royalty payments equivalent to payments that would have 
     been received for comparable production under the royalty 
     rate in effect for the lease before the date of enactment of 
     this subsection.
       (2) Timing.--A request for a modification under paragraph 
     (1) shall be submitted to the Secretary of the Interior by 
     the date that is not later than--
       (A) in the case of a lease for direct use, 18 months after 
     the effective date of the schedule of fees established by the 
     Secretary of the Interior under section 5 of the Geothermal 
     Steam Act of 1970 (30 U.S.C. 1004); or
       (B) in the case of any other lease, 18 months after the 
     effective date of the final regulation issued under 
     subsection (a).
       (3) Application of modification.--If the lessee requests 
     modification of a lease under paragraph (1)--
       (A) the Secretary of the Interior shall, within 180 days 
     after the receipt of the request for modification, modify the 
     lease to comply with--
       (i) in the case of a lease for direct use, the schedule of 
     fees established by the Secretary under section 5 of the 
     Geothermal Steam Act of 1970 (30 U.S.C. 1004); or
       (ii) in the case of any other lease, the royalty for the 
     lease established under paragraph (1)(B); and
       (B) the modification shall apply to any use of geothermal 
     resources to which subsection (a) applies that occurs after 
     the date of the modification.
       (4) Consultation.--The Secretary of the Interior shall 
     consult with the State and local governments affected by any 
     proposed changes in lease royalty terms under this 
     subsection.

     SEC. 225. COORDINATION OF GEOTHERMAL LEASING AND PERMITTING 
                   ON FEDERAL LANDS.

       (a) In General.--Not later than 180 days after the date of 
     enactment of this section, the Secretary of the Interior and 
     the Secretary of Agriculture shall enter into and submit to 
     Congress a memorandum of understanding in accordance with 
     this section, the Geothermal Steam Act of 1970 (as amended by 
     this Act), and other applicable laws, regarding coordination 
     of leasing and permitting for geothermal development of 
     public lands and National Forest System lands under their 
     respective jurisdictions.
       (b) Lease and Permit Applications.--The memorandum of 
     understanding shall--
       (1) establish an administrative procedure for processing 
     geothermal lease applications, including lines of authority, 
     steps in application processing, and time limits for 
     application procession;
       (2) establish a 5-year program for geothermal leasing of 
     lands in the National Forest System, and a process for 
     updating that program every 5 years; and
       (3) establish a program for reducing the backlog of 
     geothermal lease application pending on January 1, 2005, by 
     90 percent within the 5-year period beginning on the date of 
     enactment of this Act, including, as necessary, by issuing 
     leases, rejecting lease applications for failure to comply 
     with the provisions of the regulations under which they were 
     filed, or determining that an original applicant (or the 
     applicant's assigns, heirs, or estate) is no longer 
     interested in pursuing the lease application.
       (c) Data Retrieval System.--The memorandum of understanding 
     shall establish a joint data retrieval system that is capable 
     of tracking lease and permit applications and providing to 
     the applicant information as to their status within the 
     Departments of the Interior and Agriculture, including an 
     estimate of the time required for administrative action.

     SEC. 226. ASSESSMENT OF GEOTHERMAL ENERGY POTENTIAL.

       Not later than 3 years after the date of enactment of this 
     Act and thereafter as the availability of data and 
     developments in technology warrants, the Secretary of the 
     Interior, acting through the Director of the United States 
     Geological Survey and in cooperation with the States, shall--
       (1) update the Assessment of Geothermal Resources made 
     during 1978; and
       (2) submit to Congress the updated assessment.

     SEC. 227. COOPERATIVE OR UNIT PLANS.

       Section 18 of the Geothermal Steam Act of 1970 (30 U.S.C. 
     1017) is amended to read as follows:

     ``SEC. 18. UNIT AND COMMUNITIZATION AGREEMENTS.

       ``(a) Adoption of Units by Lessees.--
       ``(1) In general.--For the purpose of more properly 
     conserving the natural resources of any geothermal reservoir, 
     field, or like area, or any part thereof (whether or not any 
     part of the geothermal reservoir, field, or like area, is 
     subject to any cooperative plan of development or operation 
     (referred to in this section as a `unit agreement')), lessees 
     thereof and their representatives may unite with each other, 
     or jointly or separately with others, in collectively 
     adopting and operating under a unit agreement for the 
     reservoir, field, or like area, or any part thereof, 
     including direct use resources, if determined and certified 
     by the Secretary to be necessary or advisable in the public 
     interest.
       ``(2) Majority interest of single leases.--A majority 
     interest of owners of any single lease shall have the 
     authority to commit the lease to a unit agreement.
       ``(3) Initiative of secretary.--The Secretary may also 
     initiate the formation of a unit agreement, or require an 
     existing Federal lease to commit to a unit agreement, if in 
     the public interest.
       ``(4) Modification of lease requirements by secretary.--
       ``(A) In general.--The Secretary may, in the discretion of 
     the Secretary and with the consent of the holders of leases 
     involved, establish, alter, change, or revoke rates of 
     operations (including drilling, operations, production, and 
     other requirements) of the leases and make conditions with 
     respect to the leases, with the consent of the lessees, in 
     connection with the creation and operation of any such unit 
     agreement as the Secretary may consider necessary or 
     advisable to secure the protection of the public interest.
       ``(B) Unlike terms or rates.--Leases with unlike lease 
     terms or royalty rates shall not be required to be modified 
     to be in the same unit.
       ``(b) Requirement of Plans Under New Leases.--The Secretary 
     may--
       ``(1) provide that geothermal leases issued under this Act 
     shall contain a provision requiring the lessee to operate 
     under a unit agreement; and
       ``(2) prescribe the unit agreement under which the lessee 
     shall operate, which shall adequately protect the rights of 
     all parties in interest, including the United States.
       ``(c) Modification of Rate of Prospecting, Development, and 
     Production.--The Secretary may require that any unit 
     agreement authorized by this section that applies to land 
     owned by the United States contain a provision under which 
     authority is vested in the Secretary, or any person, 
     committee, or State or Federal officer or agency as may be 
     designated in the unit agreement to alter or modify, from 
     time to time, the rate of prospecting and development and the 
     quantity and rate of production under the unit agreement.
       ``(d) Exclusion From Determination of Holding or Control.--
     Any land that is subject to a unit agreement approved or 
     prescribed by the Secretary under this section shall not be 
     considered in determining holdings or control under section 
     7.
       ``(e) Pooling of Certain Land.--If separate tracts of land 
     cannot be independently developed and operated to use 
     geothermal resources pursuant to any section of this Act--
       ``(1) the land, or a portion of the land, may be pooled 
     with other land, whether or not owned by the United States, 
     for purposes of development and operation under a 
     communitization agreement providing for an apportionment of 
     production or royalties among the separate tracts of land 
     comprising the production unit, if the pooling is determined 
     by the Secretary to be in the public interest; and
       ``(2) operation or production pursuant to the 
     communitization agreement shall be treated as operation or 
     production with respect to each tract of land that is subject 
     to the communitization agreement.
       ``(f) Unit Agreement Review.--
       ``(1) In general.--Not later than 5 years after the date of 
     approval of any unit agreement and at least every 5 years 
     thereafter, the Secretary shall--
       ``(A) review each unit agreement; and
       ``(B) after notice and opportunity for comment, eliminate 
     from inclusion in the unit agreement any land that the 
     Secretary determines is not reasonably necessary for unit 
     operations under the unit agreement.
       ``(2) Basis for elimination.--The elimination shall--
       ``(A) be based on scientific evidence; and
       ``(B) occur only if the elimination is determined by the 
     Secretary to be for the purpose of conserving and properly 
     managing the geothermal resource.
       ``(3) Extension.--Any land eliminated under this subsection 
     shall be eligible for an extension under section 6(g) if the 
     land meets the requirements for the extension.
       ``(g) Drilling or Development Contracts.--
       ``(1) In general.--The Secretary may, on such conditions as 
     the Secretary may prescribe, approve drilling or development 
     contracts made by 1 or more lessees of geothermal leases, 
     with 1 or more persons, associations, or corporations if, in 
     the discretion of the Secretary, the conservation of natural 
     resources or the public convenience or necessity may require 
     or the interests of the United States may be best served by 
     the approval.
       ``(2) Holdings or control.--Each lease operated under an 
     approved drilling or development contract, and interest under 
     the contract, shall be excepted in determining holdings or 
     control under section 7.
       ``(h) Coordination With State Governments.--The Secretary 
     shall coordinate unitization and pooling activities with 
     appropriate State agencies.''.

     SEC. 228. ROYALTY ON BYPRODUCTS.

       Section 5 of the Geothermal Steam Act of 1970 (30 U.S.C. 
     1004) (as amended by section 223(a))

[[Page 17815]]

     is further amended in subsection (a) by striking paragraph 
     (2) and inserting the following:
       ``(2) a royalty on any byproduct that is a mineral 
     specified in the first section of the Mineral Leasing Act (30 
     U.S.C. 181), and that is derived from production under the 
     lease, at the rate of the royalty that applies under that Act 
     to production of the mineral under a lease under that Act;''.

     SEC. 229. AUTHORITIES OF SECRETARY TO READJUST TERMS, 
                   CONDITIONS, RENTALS, AND ROYALTIES.

       Section 8(b) of the Geothermal Steam Act of 1970 (30 U.S.C. 
     1006) is amended in the second sentence by striking ``period, 
     and in no event'' and all that follows through the end of the 
     sentence and inserting ``period''.

     SEC. 230. CREDITING OF RENTAL TOWARD ROYALTY.

       Section 5 of the Geothermal Steam Act of 1970 (30 U.S.C. 
     1004) (as amended by sections 223 and 224) is further 
     amended--
       (1) in subsection (a)(2) by inserting ``and'' after the 
     semicolon at the end;
       (2) in subsection (a)(3) by striking ``; and'' and 
     inserting a period;
       (3) by striking paragraph (4) of subsection (a); and
       (4) by adding at the end the following:
       ``(e) Crediting of Rental Toward Royalty.--Any annual 
     rental under this section that is paid with respect to a 
     lease before the first day of the year for which the annual 
     rental is owed shall be credited to the amount of royalty 
     that is required to be paid under the lease for that year.''.

     SEC. 231. LEASE DURATION AND WORK COMMITMENT REQUIREMENTS.

       Section 6 of the Geothermal Steam Act of 1970 (30 U.S.C. 
     1005) is amended--
       (1) by striking so much as precedes subsection (c), and 
     striking subsections (e), (g), (h), (i), and (j);
       (2) by redesignating subsections (c), (d), and (f) in order 
     as subsections (g), (h), and (i); and
       (3) by inserting before subsection (g), as so redesignated, 
     the following:

     ``SEC. 6. LEASE TERM AND WORK COMMITMENT REQUIREMENTS.

       ``(a) In General.--
       ``(1) Primary term.--A geothermal lease shall be for a 
     primary term of 10 years.
       ``(2) Initial extension.--The Secretary shall extend the 
     primary term of a geothermal lease for 5 years if, for each 
     year after the tenth year of the lease--
       ``(A) the Secretary determined under subsection (b) that 
     the lessee satisfied the work commitment requirements that 
     applied to the lease for that year; or
       ``(B) the lessee paid in annual payments accordance with 
     subsection (c).
       ``(3) Additional extension.--The Secretary shall extend the 
     primary term of a geothermal lease (after an initial 
     extension under paragraph (2)) for an additional 5 years if, 
     for each year of the initial extension under paragraph (2), 
     the Secretary determined under subsection (b) that the lessee 
     satisfied the minimum work requirements that applied to the 
     lease for that year.
       ``(b) Requirement to Satisfy Annual Minimum Work 
     Requirement.--
       ``(1) In general.--The lessee for a geothermal lease shall, 
     for each year after the tenth year of the lease, satisfy 
     minimum work requirements prescribed by the Secretary that 
     apply to the lease for that year.
       ``(2) Prescription of minimum work requirements.--The 
     Secretary shall issue regulations prescribing minimum work 
     requirements for geothermal leases, that--
       ``(A) establish a geothermal potential; and
       ``(B) if a geothermal potential has been established, 
     confirm the existence of producible geothermal resources.
       ``(c) Payments in Lieu of Minimum Work Requirements.--In 
     lieu of the minimum work requirements set forth in subsection 
     (b)(2), the Secretary shall by regulation establish minimum 
     annual payments which may be made by the lessee for a limited 
     number of years that the Secretary determines will not impair 
     achieving diligent development of the geothermal resource, 
     but in no event shall the number of years exceed the duration 
     of the extension period provided in subsection (a).
       ``(d) Transition Rules for Leases Issued Prior to Enactment 
     of Energy Policy Act of 2005.--The Secretary shall by 
     regulation establish transition rules for leases issued 
     before the date of the enactment of this subsection, 
     including terms under which a lease that is near the end of 
     its term on the date of enactment of this subsection may be 
     extended for up to 2 years--
       ``(1) to allow achievement of production under the lease; 
     or
       ``(2) to allow the lease to be included in a producing 
     unit.
       ``(e) Geothermal Lease Overlying Mining Claim.--
       ``(1) Exemption.--The lessee for a geothermal lease of an 
     area overlying an area subject to a mining claim for which a 
     plan of operations has been approved by the relevant Federal 
     land management agency is exempt from annual work 
     requirements established under this Act, if development of 
     the geothermal resource subject to the lease would interfere 
     with the mining operations under such claim.
       ``(2) Termination of exemption.--An exemption under this 
     paragraph expires upon the termination of the mining 
     operations.
       ``(f) Termination of Application of Requirements.--Minimum 
     work requirements prescribed under this section shall not 
     apply to a geothermal lease after the date on which the 
     geothermal resource is utilized under the lease in commercial 
     quantities.''.

     SEC. 232. ADVANCED ROYALTIES REQUIRED FOR CESSATION OF 
                   PRODUCTION.

       Section 5 of the Geothermal Steam Act of 1970 (30 U.S.C. 
     1004) (as amended by sections 223, 224, and 230) is further 
     amended by adding at the end the following:
       ``(f) Advanced Royalties Required for Cessation of 
     Production.--
       ``(1) In general.--Subject to paragraphs (2) and (3), if, 
     at any time after commercial production under a lease is 
     achieved, production ceases for any reason, the lease shall 
     remain in full force and effect for a period of not more than 
     an aggregate number of 10 years beginning on the date 
     production ceases, if, during the period in which production 
     is ceased, the lessee pays royalties in advance at the 
     monthly average rate at which the royalty was paid during the 
     period of production.
       ``(2) Reduction.--The amount of any production royalty paid 
     for any year shall be reduced (but not below 0) by the amount 
     of any advanced royalties paid under the lease to the extent 
     that the advance royalties have not been used to reduce 
     production royalties for a prior year.
       ``(3) Exceptions.--Paragraph (1) shall not apply if the 
     cessation in production is required or otherwise caused by--
       ``(A) the Secretary;
       ``(B) the Secretary of the Air Force;
       ``(C) the Secretary of the Army;
       ``(D) the Secretary of the Navy;
       ``(E) a State or a political subdivision of a State; or
       ``(F) a force majeure.''.

     SEC. 233. ANNUAL RENTAL.

       (a) Annual Rental Rate.--Section 5 of the Geothermal Steam 
     Act of 1970 (30 U.S.C. 1004) (as amended by section 223(a)) 
     is further amended in subsection (a) by striking paragraph 
     (3) and inserting the following:
       ``(3) payment in advance of an annual rental of not less 
     than--
       ``(A) for each of the first through tenth years of the 
     lease--
       ``(i) in the case of a lease awarded in a noncompetitive 
     lease sale, $1 per acre or fraction thereof; or
       ``(ii) in the case of a lease awarded in a competitive 
     lease sale, $2 per acre or fraction thereof for the first 
     year and $3 per acre or fraction thereof for each of the 
     second through 10th years; and
       ``(B) for each year after the 10th year of the lease, $5 
     per acre or fraction thereof;''.
       (b) Termination of Lease for Failure to Pay Rental.--
     Section 5 of the Geothermal Steam Act of 1970 (30 U.S.C. 
     1004) (as amended by sections 223, 224, 230, and 232) is 
     further amended by adding at the end the following:
       ``(g) Termination of Lease for Failure to Pay Rental.--
       ``(1) In general.--The Secretary shall terminate any lease 
     with respect to which rental is not paid in accordance with 
     this Act and the terms of the lease under which the rental is 
     required, on the expiration of the 45-day period beginning on 
     the date of the failure to pay the rental.
       ``(2) Notification.--The Secretary shall promptly notify a 
     lessee that has not paid rental required under the lease that 
     the lease will be terminated at the end of the period 
     referred to in paragraph (1).
       ``(3) Reinstatement.--A lease that would otherwise 
     terminate under paragraph (1) shall not terminate under that 
     paragraph if the lessee pays to the Secretary, before the end 
     of the period referred to in paragraph (1), the amount of 
     rental due plus a late fee equal to 10 percent of the 
     amount.''.

     SEC. 234. DEPOSIT AND USE OF GEOTHERMAL LEASE REVENUES FOR 5 
                   FISCAL YEARS.

       (a) Deposit of Geothermal Resources Leases.--
     Notwithstanding any other provision of law, amounts received 
     by the United States in the first 5 fiscal years beginning 
     after the date of enactment of this Act as rentals, 
     royalties, and other payments required under leases under the 
     Geothermal Steam Act of 1970, excluding funds required to be 
     paid to State and county governments, shall be deposited into 
     a separate account in the Treasury.
       (b) Use of Deposits.--Amounts deposited under subsection 
     (a) shall be available to the Secretary of the Interior for 
     expenditure, without further appropriation and without fiscal 
     year limitation, to implement the Geothermal Steam Act of 
     1970 and this Act.
       (c) Transfer of Funds.--For the purposes of coordination 
     and processing of geothermal leases and geothermal use 
     authorizations on Federal land the Secretary of the Interior 
     may authorize the expenditure or transfer of such funds as 
     are necessary to the Forest Service.

     SEC. 235. ACREAGE LIMITATIONS.

       Section 7 of the Geothermal Steam Act of 1970 (30 U.S.C. 
     1006) is amended--
       (1) by striking ``sec. 7.'', and by 
     inserting immediately before and above the first paragraph 
     the following:

     ``SEC. 7. ACREAGE LIMITATIONS.'';

       (2) in the first paragraph--
       (A) by striking ``two thousand five hundred and sixty 
     acres'' and inserting ``5,120 acres''; and
       (B) by striking ``twenty thousand four hundred and eighty 
     acres'' and inserting ``51,200 acres''; and
       (3) by striking the second paragraph.

     SEC. 236. TECHNICAL AMENDMENTS.

       The Geothermal Steam Act of 1970 (30 U.S.C. 1001 et seq.) 
     is further amended as follows:

[[Page 17816]]

       (1) By striking ``geothermal steam and associated 
     geothermal resources'' each place it appears and inserting 
     ``geothermal resources''.
       (2) Section 2 (30 U.S.C. 1001) is amended by adding at the 
     end the following:
       ``(g) `direct use' means utilization of geothermal 
     resources for commercial, residential, agricultural, public 
     facilities, or other energy needs other than the commercial 
     production of electricity; and''.
       (3) Section 21 (30 U.S.C. 1020) is amended by striking 
     ``(a) Within one hundred'' and all that follows through ``(b) 
     Geothermal'' and inserting ``Geothermal''.
       (4) The first section (30 U.S.C. 1001 note) is amended by 
     striking ``That this'' and inserting the following:

     ``SEC. 1. SHORT TITLE.

       ``This''.
       (5) Section 2 (30 U.S.C. 1001) is amended by striking 
     ``SEC. 2. As'' and inserting the following:

     ``SEC. 2. DEFINITIONS.

       ``As''.
       (6) Section 3 (30 U.S.C. 1002) is amended by striking 
     ``SEC. 3. Subject'' and inserting the following:

     ``SEC. 3. LANDS SUBJECT TO GEOTHERMAL LEASING.

       ``Subject''.
       (7) Section 5 (30 U.S.C. 1004) is further amended by 
     striking ``SEC. 5.'', and by inserting immediately before and 
     above subsection (a) the following:

     ``SEC. 5. RENTS AND ROYALTIES.''.

       (8) Section 8 (30 U.S.C. 1007) is amended by striking 
     ``SEC. 8. (a) The'' and inserting the following:

     ``SEC. 8. READJUSTMENT OF LEASE TERMS AND CONDITIONS.

       ``(a) The''.
       (9) Section 9 (30 U.S.C. 1008) is amended by striking 
     ``SEC. 9. If'' and inserting the following:

     ``SEC. 9. BYPRODUCTS.

       ``If''.
       (10) Section 10 (30 U.S.C. 1009) is amended by striking 
     ``SEC. 10. The'' and inserting the following:

     ``SEC. 10. RELINQUISHMENT OF GEOTHERMAL RIGHTS.

       ``The''.
       (11) Section 11 (30 U.S.C. 1010) is amended by striking 
     ``SEC. 11. The'' and inserting the following:

     ``SEC. 11. SUSPENSION OF OPERATIONS AND PRODUCTION.

       ``The''.
       (12) Section 12 (30 U.S.C. 1011) is amended by striking 
     ``SEC. 12. Leases'' and inserting the following:

     ``SEC. 12. TERMINATION OF LEASES.

       ``Leases''.
       (13) Section 13 (30 U.S.C. 1012) is amended by striking 
     ``SEC. 13. The'' and inserting the following:

     ``SEC. 13. WAIVER, SUSPENSION, OR REDUCTION OF RENTAL OR 
                   ROYALTY.

       ``The''.
       (14) Section 14 (30 U.S.C. 1013) is amended by striking 
     ``SEC. 14. Subject'' and inserting the following:

     ``SEC. 14. SURFACE LAND USE.

       ``Subject''.
       (15) Section 15 (30 U.S.C. 1014) is amended by striking 
     ``SEC. 15. (a) Geothermal'' and inserting the following:

     ``SEC. 15. LANDS SUBJECT TO GEOTHERMAL LEASING.

       ``(a) Geothermal''.
       (16) Section 16 (30 U.S.C. 1015) is amended by striking 
     ``SEC. 16. Leases'' and inserting the following:

     ``SEC. 16. REQUIREMENT FOR LESSEES.

       ``Leases''.
       (17) Section 17 (30 U.S.C. 1016) is amended by striking 
     ``SEC. 17. Administration'' and inserting the following:

     ``SEC. 17. ADMINISTRATION.

       ``Administration''.
       (18) Section 19 (30 U.S.C. 1018) is amended by striking 
     ``SEC. 19. Upon'' and inserting the following:

     ``SEC. 19. DATA FROM FEDERAL AGENCIES.

       ``Upon''.
       (19) Section 21 (30 U.S.C. 1020) is further amended by 
     striking ``SEC. 21.'', and by inserting immediately before 
     and above the remainder of that section the following:

     ``SEC. 21. PUBLICATION IN FEDERAL REGISTER; RESERVATION OF 
                   MINERAL RIGHTS.''.

       (20) Section 22 (30 U.S.C. 1021) is amended by striking 
     ``SEC. 22. Nothing'' and inserting the following:

     ``SEC. 22. FEDERAL EXEMPTION FROM STATE WATER LAWS.

       ``Nothing''.
       (21) Section 23 (30 U.S.C. 1022) is amended by striking 
     ``SEC. 23. (a) All'' and inserting the following:

     ``SEC. 23. PREVENTION OF WASTE; EXCLUSIVITY.

       ``(a) All''.
       (22) Section 24 (30 U.S.C. 1023) is amended by striking 
     ``SEC. 24. The'' and inserting the following:

     ``SEC. 24. RULES AND REGULATIONS.

       ``The''.
       (23) Section 25 (30 U.S.C. 1024) is amended by striking 
     ``SEC. 25. As'' and inserting the following:

     ``SEC. 25. INCLUSION OF GEOTHERMAL LEASING UNDER CERTAIN 
                   OTHER LAWS.

       ``As''.
       (24) Section 26 is amended by striking ``SEC. 26. The'' and 
     inserting the following:

     ``SEC. 26. AMENDMENT.

       ``The''.
       (25) Section 27 (30 U.S.C. 1025) is amended by striking 
     ``SEC. 27. The'' and inserting the following:

     ``SEC. 27. FEDERAL RESERVATION OF CERTAIN MINERAL RIGHTS.

       ``The''.
       (26) Section 28 (30 U.S.C. 1026) is amended by striking 
     ``SEC. 28. (a)(1) The'' and inserting the following:

     ``SEC. 28. SIGNIFICANT THERMAL FEATURES.

       ``(a)(1) The''.
       (27) Section 29 (30 U.S.C. 1027) is amended by striking 
     ``SEC. 29. The'' and inserting the following:

     ``SEC. 29. LAND SUBJECT TO PROHIBITION ON LEASING.

       ``The''.

     SEC. 237. INTERMOUNTAIN WEST GEOTHERMAL CONSORTIUM.

       (a) Participation Authorized.--The Secretary, acting 
     through the Idaho National Laboratory, may participate in a 
     consortium described in subsection (b) to address science and 
     science policy issues surrounding the expanded discovery and 
     use of geothermal energy, including from geothermal resources 
     on public lands.
       (b) Members.--The consortium referred to in subsection (a) 
     shall--
       (1) be known as the ``Intermountain West Geothermal 
     Consortium'';
       (2) be a regional consortium of institutions and government 
     agencies that focuses on building collaborative efforts among 
     the universities in the State of Idaho, other regional 
     universities, State agencies, and the Idaho National 
     Laboratory;
       (3) include Boise State University, the University of Idaho 
     (including the Idaho Water Resources Research Institute), the 
     Oregon Institute of Technology, the Desert Research Institute 
     with the University and Community College System of Nevada, 
     and the Energy and Geoscience Institute at the University of 
     Utah;
       (4) be hosted and managed by Boise State University; and
       (5) have a director appointed by Boise State University, 
     and associate directors appointed by each participating 
     institution.
       (c) Financial Assistance.--The Secretary, acting through 
     the Idaho National Laboratory and subject to the availability 
     of appropriations, will provide financial assistance to Boise 
     State University for expenditure under contracts with members 
     of the consortium to carry out the activities of the 
     consortium.
                       Subtitle C--Hydroelectric

     SEC. 241. ALTERNATIVE CONDITIONS AND FISHWAYS.

       (a) Federal Reservations.--Section 4(e) of the Federal 
     Power Act (16 U.S.C. 797(e)) is amended by inserting after 
     ``adequate protection and utilization of such reservation.'' 
     at the end of the first proviso the following: ``The license 
     applicant and any party to the proceeding shall be entitled 
     to a determination on the record, after opportunity for an 
     agency trial-type hearing of no more than 90 days, on any 
     disputed issues of material fact with respect to such 
     conditions. All disputed issues of material fact raised by 
     any party shall be determined in a single trial-type hearing 
     to be conducted by the relevant resource agency in accordance 
     with the regulations promulgated under this subsection and 
     within the time frame established by the Commission for each 
     license proceeding. Within 90 days of the date of enactment 
     of the Energy Policy Act of 2005, the Secretaries of the 
     Interior, Commerce, and Agriculture shall establish jointly, 
     by rule, the procedures for such expedited trial-type 
     hearing, including the opportunity to undertake discovery and 
     cross-examine witnesses, in consultation with the Federal 
     Energy Regulatory Commission.''.
       (b) Fishways.--Section 18 of the Federal Power Act (16 
     U.S.C. 811) is amended by inserting after ``and such fishways 
     as may be prescribed by the Secretary of Commerce.'' the 
     following: ``The license applicant and any party to the 
     proceeding shall be entitled to a determination on the 
     record, after opportunity for an agency trial-type hearing of 
     no more than 90 days, on any disputed issues of material fact 
     with respect to such fishways. All disputed issues of 
     material fact raised by any party shall be determined in a 
     single trial-type hearing to be conducted by the relevant 
     resource agency in accordance with the regulations 
     promulgated under this subsection and within the time frame 
     established by the Commission for each license proceeding. 
     Within 90 days of the date of enactment of the Energy Policy 
     Act of 2005, the Secretaries of the Interior, Commerce, and 
     Agriculture shall establish jointly, by rule, the procedures 
     for such expedited trial-type hearing, including the 
     opportunity to undertake discovery and cross-examine 
     witnesses, in consultation with the Federal Energy Regulatory 
     Commission.''.
       (c) Alternative Conditions and Prescriptions.--Part I of 
     the Federal Power Act (16 U.S.C. 791a et seq.) is amended by 
     adding the following new section at the end thereof:

     ``SEC. 33. ALTERNATIVE CONDITIONS AND PRESCRIPTIONS.

       ``(a) Alternative Conditions.--(1) Whenever any person 
     applies for a license for any project works within any 
     reservation of the United States, and the Secretary of the 
     department under whose supervision such reservation falls 
     (referred to in this subsection as the `Secretary') deems a 
     condition to such license to be necessary under the first 
     proviso of section 4(e), the

[[Page 17817]]

     license applicant or any other party to the license 
     proceeding may propose an alternative condition.
       ``(2) Notwithstanding the first proviso of section 4(e), 
     the Secretary shall accept the proposed alternative condition 
     referred to in paragraph (1), and the Commission shall 
     include in the license such alternative condition, if the 
     Secretary determines, based on substantial evidence provided 
     by the license applicant, any other party to the proceeding, 
     or otherwise available to the Secretary, that such 
     alternative condition--
       ``(A) provides for the adequate protection and utilization 
     of the reservation; and
       ``(B) will either, as compared to the condition initially 
     by the Secretary--
       ``(i) cost significantly less to implement; or
       ``(ii) result in improved operation of the project works 
     for electricity production.
       ``(3) In making a determination under paragraph (2), the 
     Secretary shall consider evidence provided for the record by 
     any party to a licensing proceeding, or otherwise available 
     to the Secretary, including any evidence provided by the 
     Commission, on the implementation costs or operational 
     impacts for electricity production of a proposed alternative.
       ``(4) The Secretary concerned shall submit into the public 
     record of the Commission proceeding with any condition under 
     section 4(e) or alternative condition it accepts under this 
     section, a written statement explaining the basis for such 
     condition, and reason for not accepting any alternative 
     condition under this section. The written statement must 
     demonstrate that the Secretary gave equal consideration to 
     the effects of the condition adopted and alternatives not 
     accepted on energy supply, distribution, cost, and use; flood 
     control; navigation; water supply; and air quality (in 
     addition to the preservation of other aspects of 
     environmental quality); based on such information as may be 
     available to the Secretary, including information voluntarily 
     provided in a timely manner by the applicant and others. The 
     Secretary shall also submit, together with the aforementioned 
     written statement, all studies, data, and other factual 
     information available to the Secretary and relevant to the 
     Secretary's decision.
       ``(5) If the Commission finds that the Secretary's final 
     condition would be inconsistent with the purposes of this 
     part, or other applicable law, the Commission may refer the 
     dispute to the Commission's Dispute Resolution Service. The 
     Dispute Resolution Service shall consult with the Secretary 
     and the Commission and issue a non-binding advisory within 90 
     days. The Secretary may accept the Dispute Resolution Service 
     advisory unless the Secretary finds that the recommendation 
     will not adequately protect the reservation. The Secretary 
     shall submit the advisory and the Secretary's final written 
     determination into the record of the Commission's proceeding.
       ``(b) Alternative Prescriptions.--(1) Whenever the 
     Secretary of the Interior or the Secretary of Commerce 
     prescribes a fishway under section 18, the license applicant 
     or any other party to the license proceeding may propose an 
     alternative to such prescription to construct, maintain, or 
     operate a fishway.
       ``(2) Notwithstanding section 18, the Secretary of the 
     Interior or the Secretary of Commerce, as appropriate, shall 
     accept and prescribe, and the Commission shall require, the 
     proposed alternative referred to in paragraph (1), if the 
     Secretary of the appropriate department determines, based on 
     substantial evidence provided by the license applicant, any 
     other party to the proceeding, or otherwise available to the 
     Secretary, that such alternative--
       ``(A) will be no less protective than the fishway initially 
     prescribed by the Secretary; and
       ``(B) will either, as compared to the fishway initially 
     prescribed by the Secretary--
       ``(i) cost significantly less to implement; or
       ``(ii) result in improved operation of the project works 
     for electricity production.
       ``(3) In making a determination under paragraph (2), the 
     Secretary shall consider evidence provided for the record by 
     any party to a licensing proceeding, or otherwise available 
     to the Secretary, including any evidence provided by the 
     Commission, on the implementation costs or operational 
     impacts for electricity production of a proposed alternative.
       ``(4) The Secretary concerned shall submit into the public 
     record of the Commission proceeding with any prescription 
     under section 18 or alternative prescription it accepts under 
     this section, a written statement explaining the basis for 
     such prescription, and reason for not accepting any 
     alternative prescription under this section. The written 
     statement must demonstrate that the Secretary gave equal 
     consideration to the effects of the prescription adopted and 
     alternatives not accepted on energy supply, distribution, 
     cost, and use; flood control; navigation; water supply; and 
     air quality (in addition to the preservation of other aspects 
     of environmental quality); based on such information as may 
     be available to the Secretary, including information 
     voluntarily provided in a timely manner by the applicant and 
     others. The Secretary shall also submit, together with the 
     aforementioned written statement, all studies, data, and 
     other factual information available to the Secretary and 
     relevant to the Secretary's decision.
       ``(5) If the Commission finds that the Secretary's final 
     prescription would be inconsistent with the purposes of this 
     part, or other applicable law, the Commission may refer the 
     dispute to the Commission's Dispute Resolution Service. The 
     Dispute Resolution Service shall consult with the Secretary 
     and the Commission and issue a non-binding advisory within 90 
     days. The Secretary may accept the Dispute Resolution Service 
     advisory unless the Secretary finds that the recommendation 
     will not adequately protect the fish resources. The Secretary 
     shall submit the advisory and the Secretary's final written 
     determination into the record of the Commission's 
     proceeding.''.

     SEC. 242. HYDROELECTRIC PRODUCTION INCENTIVES.

       (a) Incentive Payments.--For electric energy generated and 
     sold by a qualified hydroelectric facility during the 
     incentive period, the Secretary shall make, subject to the 
     availability of appropriations, incentive payments to the 
     owner or operator of such facility. The amount of such 
     payment made to any such owner or operator shall be as 
     determined under subsection (e) of this section. Payments 
     under this section may only be made upon receipt by the 
     Secretary of an incentive payment application which 
     establishes that the applicant is eligible to receive such 
     payment and which satisfies such other requirements as the 
     Secretary deems necessary. Such application shall be in such 
     form, and shall be submitted at such time, as the Secretary 
     shall establish.
       (b) Definitions.--For purposes of this section:
       (1) Qualified hydroelectric facility.--The term ``qualified 
     hydroelectric facility'' means a turbine or other generating 
     device owned or solely operated by a non-Federal entity which 
     generates hydroelectric energy for sale and which is added to 
     an existing dam or conduit.
       (2) Existing dam or conduit.--The term ``existing dam or 
     conduit'' means any dam or conduit the construction of which 
     was completed before the date of the enactment of this 
     section and which does not require any construction or 
     enlargement of impoundment or diversion structures (other 
     than repair or reconstruction) in connection with the 
     installation of a turbine or other generating device.
       (3) Conduit.--The term ``conduit'' has the same meaning as 
     when used in section 30(a)(2) of the Federal Power Act (16 
     U.S.C. 823a(a)(2)).

     The terms defined in this subsection shall apply without 
     regard to the hydroelectric kilowatt capacity of the facility 
     concerned, without regard to whether the facility uses a dam 
     owned by a governmental or nongovernmental entity, and 
     without regard to whether the facility begins operation on or 
     after the date of the enactment of this section.
       (c) Eligibility Window.--Payments may be made under this 
     section only for electric energy generated from a qualified 
     hydroelectric facility which begins operation during the 
     period of 10 fiscal years beginning with the first full 
     fiscal year occurring after the date of enactment of this 
     subtitle.
       (d) Incentive Period.--A qualified hydroelectric facility 
     may receive payments under this section for a period of 10 
     fiscal years (referred to in this section as the ``incentive 
     period''). Such period shall begin with the fiscal year in 
     which electric energy generated from the facility is first 
     eligible for such payments.
       (e) Amount of Payment.--
       (1) In general.--Payments made by the Secretary under this 
     section to the owner or operator of a qualified hydroelectric 
     facility shall be based on the number of kilowatt hours of 
     hydroelectric energy generated by the facility during the 
     incentive period. For any such facility, the amount of such 
     payment shall be 1.8 cents per kilowatt hour (adjusted as 
     provided in paragraph (2)), subject to the availability of 
     appropriations under subsection (g), except that no facility 
     may receive more than $750,000 in 1 calendar year.
       (2) Adjustments.--The amount of the payment made to any 
     person under this section as provided in paragraph (1) shall 
     be adjusted for inflation for each fiscal year beginning 
     after calendar year 2005 in the same manner as provided in 
     the provisions of section 29(d)(2)(B) of the Internal Revenue 
     Code of 1986, except that in applying such provisions the 
     calendar year 2005 shall be substituted for calendar year 
     1979.
       (f) Sunset.--No payment may be made under this section to 
     any qualified hydroelectric facility after the expiration of 
     the period of 20 fiscal years beginning with the first full 
     fiscal year occurring after the date of enactment of this 
     subtitle, and no payment may be made under this section to 
     any such facility after a payment has been made with respect 
     to such facility for a period of 10 fiscal years.
       (g) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary to carry out the purposes 
     of this section $10,000,000 for each of the fiscal years 2006 
     through 2015.

     SEC. 243. HYDROELECTRIC EFFICIENCY IMPROVEMENT.

       (a) Incentive Payments.--The Secretary shall make incentive 
     payments to the owners or operators of hydroelectric 
     facilities at existing dams to be used to make capital 
     improvements in the facilities that are directly related to 
     improving the efficiency of such facilities by at least 3 
     percent.
       (b) Limitations.--Incentive payments under this section 
     shall not exceed 10 percent of the costs of the capital 
     improvement concerned and not more than 1 payment may be made 
     with respect to improvements at a single facility. No payment 
     in excess of $750,000 may be made with respect to 
     improvements at a single facility.
       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section not more than 
     $10,000,000 for each of the fiscal years 2006 through 2015.

     SEC. 244. ALASKA STATE JURISDICTION OVER SMALL HYDROELECTRIC 
                   PROJECTS.

       Section 32 of the Federal Power Act (16 U.S.C. 823c) is 
     amended--

[[Page 17818]]

       (1) in subsection (a)(3)(C), by inserting ``except as 
     provided in subsection (j),'' before ``conditions''; and
       (2) by adding at the end the following:
       ``(j) Fish and Wildlife.--If the State of Alaska determines 
     that a recommendation under subsection (a)(3)(C) is 
     inconsistent with paragraphs (1) and (2) of subsection (a), 
     the State of Alaska may decline to adopt all or part of the 
     recommendations in accordance with the procedures established 
     under section 10(j)(2).''.

     SEC. 245. FLINT CREEK HYDROELECTRIC PROJECT.

       (a) Extension of Time.--Notwithstanding the time period 
     specified in section 5 of the Federal Power Act (16 U.S.C. 
     798) that would otherwise apply to the Federal Energy 
     Regulatory Commission (referred to in this section as the 
     ``Commission'') project numbered 12107, the Commission 
     shall--
       (1) if the preliminary permit is in effect on the date of 
     enactment of this Act, extend the preliminary permit for a 
     period of 3 years beginning on the date on which the 
     preliminary permit expires; or
       (2) if the preliminary permit expired before the date of 
     enactment of this Act, on request of the permittee, reinstate 
     the preliminary permit for an additional 3-year period 
     beginning on the date of enactment of this Act.
       (b) Limitation on Certain Fees.--Notwithstanding section 
     10(e)(1) of the Federal Power Act (16 U.S.C. 803(e)(1)) or 
     any other provision of Federal law providing for the payment 
     to the United States of charges for the use of Federal land 
     for the purposes of operating and maintaining a hydroelectric 
     development licensed by the Commission, any political 
     subdivision of the State of Montana that holds a Commission 
     license for the Commission project numbered 12107 in Granite 
     and Deer Lodge Counties, Montana, shall be required to pay to 
     the United States for the use of that land for each year 
     during which the political subdivision continues to hold the 
     license for the project, the lesser of--
       (1) $25,000; or
       (2) such annual charge as the Commission or any other 
     department or agency of the Federal Government may assess.

     SEC. 246. SMALL HYDROELECTRIC POWER PROJECTS.

       Section 408(a)(6) of the Public Utility Regulatory Policies 
     Act of 1978 (16 U.S.C. 2708(a)(6)) is amended by striking 
     ``April 20, 1977'' and inserting ``July 22, 2005''.
                       Subtitle D--Insular Energy

     SEC. 251. INSULAR AREAS ENERGY SECURITY.

       Section 604 of the Act entitled ``An Act to authorize 
     appropriations for certain insular areas of the United 
     States, and for other purposes'', approved December 24, 1980 
     (48 U.S.C. 1492), is amended--
       (1) in subsection (a)(4) by striking the period and 
     inserting a semicolon;
       (2) by adding at the end of subsection (a) the following 
     new paragraphs:
       ``(5) electric power transmission and distribution lines in 
     insular areas are inadequate to withstand damage caused by 
     the hurricanes and typhoons which frequently occur in insular 
     areas and such damage often costs millions of dollars to 
     repair; and
       ``(6) the refinement of renewable energy technologies since 
     the publication of the 1982 Territorial Energy Assessment 
     prepared pursuant to subsection (c) reveals the need to 
     reassess the state of energy production, consumption, 
     infrastructure, reliance on imported energy, opportunities 
     for energy conservation and increased energy efficiency, and 
     indigenous sources in regard to the insular areas.'';
       (3) by amending subsection (e) to read as follows:
       ``(e)(1) The Secretary of the Interior, in consultation 
     with the Secretary of Energy and the head of government of 
     each insular area, shall update the plans required under 
     subsection (c) by--
       ``(A) updating the contents required by subsection (c);
       ``(B) drafting long-term energy plans for such insular 
     areas with the objective of reducing, to the extent feasible, 
     their reliance on energy imports by the year 2012, increasing 
     energy conservation and energy efficiency, and maximizing, to 
     the extent feasible, use of indigenous energy sources; and
       ``(C) drafting long-term energy transmission line plans for 
     such insular areas with the objective that the maximum 
     percentage feasible of electric power transmission and 
     distribution lines in each insular area be protected from 
     damage caused by hurricanes and typhoons.
       ``(2) In carrying out this subsection, the Secretary of 
     Energy shall identify and evaluate the strategies or projects 
     with the greatest potential for reducing the dependence on 
     imported fossil fuels as used for the generation of 
     electricity, including strategies and projects for--
       ``(A) improved supply-side efficiency of centralized 
     electrical generation, transmission, and distribution 
     systems;
       ``(B) improved demand-side management through--
       ``(i) the application of established standards for energy 
     efficiency for appliances;
       ``(ii) the conduct of energy audits for business and 
     industrial customers; and
       ``(iii) the use of energy savings performance contracts;
       ``(C) increased use of renewable energy, including--
       ``(i) solar thermal energy for electric generation;
       ``(ii) solar thermal energy for water heating in large 
     buildings, such as hotels, hospitals, government buildings, 
     and residences;
       ``(iii) photovoltaic energy;
       ``(iv) wind energy;
       ``(v) hydroelectric energy;
       ``(vi) wave energy;
       ``(vii) energy from ocean thermal resources, including 
     ocean thermal-cooling for community air conditioning;
       ``(viii) water vapor condensation for the production of 
     potable water;
       ``(ix) fossil fuel and renewable hybrid electrical 
     generation systems; and
       ``(x) other strategies or projects that the Secretary may 
     identify as having significant potential; and
       ``(D) fuel substitution and minimization with indigenous 
     biofuels, such as coconut oil.
       ``(3) In carrying out this subsection, for each insular 
     area with a significant need for distributed generation, the 
     Secretary of Energy shall identify and evaluate the most 
     promising strategies and projects described in subparagraphs 
     (C) and (D) of paragraph (2) for meeting that need.
       ``(4) In assessing the potential of any strategy or project 
     under paragraphs (2) and (3), the Secretary of Energy shall 
     consider--
       ``(A) the estimated cost of the power or energy to be 
     produced, including--
       ``(i) any additional costs associated with the distribution 
     of the generation; and
       ``(ii) the long-term availability of the generation source;
       ``(B) the capacity of the local electrical utility to 
     manage, operate, and maintain any project that may be 
     undertaken; and
       ``(C) other factors the Secretary of Energy considers to be 
     appropriate.
       ``(5) Not later than 1 year after the date of enactment of 
     this subsection, the Secretary of the Interior shall submit 
     to the Committee on Energy and Natural Resources of the 
     Senate, the Committee on Resources of the House of 
     Representatives, and the Committee on Energy and Commerce of 
     the House of Representatives, the updated plans for each 
     insular area required by this subsection.''; and
       (4) by amending subsection (g)(4) to read as follows:
       ``(4) Power line grants for insular areas.--
       ``(A) In general.--The Secretary of the Interior is 
     authorized to make grants to governments of insular areas of 
     the United States to carry out eligible projects to protect 
     electric power transmission and distribution lines in such 
     insular areas from damage caused by hurricanes and typhoons.
       ``(B) Eligible projects.--The Secretary of the Interior may 
     award grants under subparagraph (A) only to governments of 
     insular areas of the United States that submit written 
     project plans to the Secretary for projects that meet the 
     following criteria:
       ``(i) The project is designed to protect electric power 
     transmission and distribution lines located in 1 or more of 
     the insular areas of the United States from damage caused by 
     hurricanes and typhoons.
       ``(ii) The project is likely to substantially reduce the 
     risk of future damage, hardship, loss, or suffering.
       ``(iii) The project addresses 1 or more problems that have 
     been repetitive or that pose a significant risk to public 
     health and safety.
       ``(iv) The project is not likely to cost more than the 
     value of the reduction in direct damage and other negative 
     impacts that the project is designed to prevent or mitigate. 
     The cost benefit analysis required by this criterion shall be 
     computed on a net present value basis.
       ``(v) The project design has taken into consideration long-
     term changes to the areas and persons it is designed to 
     protect and has manageable future maintenance and 
     modification requirements.
       ``(vi) The project plan includes an analysis of a range of 
     options to address the problem it is designed to prevent or 
     mitigate and a justification for the selection of the project 
     in light of that analysis.
       ``(vii) The applicant has demonstrated to the Secretary 
     that the matching funds required by subparagraph (D) are 
     available.
       ``(C) Priority.--When making grants under this paragraph, 
     the Secretary of the Interior shall give priority to grants 
     for projects which are likely to--
       ``(i) have the greatest impact on reducing future disaster 
     losses; and
       ``(ii) best conform with plans that have been approved by 
     the Federal Government or the government of the insular area 
     where the project is to be carried out for development or 
     hazard mitigation for that insular area.
       ``(D) Matching requirement.--The Federal share of the cost 
     for a project for which a grant is provided under this 
     paragraph shall not exceed 75 percent of the total cost of 
     that project. The non-Federal share of the cost may be 
     provided in the form of cash or services.
       ``(E) Treatment of funds for certain purposes.--Grants 
     provided under this paragraph shall not be considered as 
     income, a resource, or a duplicative program when determining 
     eligibility or benefit levels for Federal major disaster and 
     emergency assistance.
       ``(F) Authorization of appropriations.--There are 
     authorized to be appropriated to carry out this paragraph 
     $6,000,000 for each fiscal year beginning after the date of 
     the enactment of this paragraph.''.

     SEC. 252. PROJECTS ENHANCING INSULAR ENERGY INDEPENDENCE.

       (a) Project Feasibilty Studies.--
       (1) In general.--On a request described in paragraph (2), 
     the Secretary shall conduct a feasibility study of a project 
     to implement a

[[Page 17819]]

     strategy or project identified in the plans submitted to 
     Congress pursuant to section 604 of the Act entitled ``An Act 
     to authorize appropriations for certain insular areas of the 
     United States, and for other purposes'', approved December 
     24, 1980 (48 U.S.C. 1492), as having the potential to--
       (A) significantly reduce the dependence of an insular area 
     on imported fossil fuels; or
       (B) provide needed distributed generation to an insular 
     area.
       (2) Request.--The Secretary shall conduct a feasibility 
     study under paragraph (1) on--
       (A) the request of an electric utility located in an 
     insular area that commits to fund at least 10 percent of the 
     cost of the study; and
       (B) if the electric utility is located in the Federated 
     States of Micronesia, the Republic of the Marshall Islands, 
     or the Republic of Palau, written support for that request by 
     the President or the Ambassador of the affected freely 
     associated state.
       (3) Consultation.--The Secretary shall consult with 
     regional utility organizations in--
       (A) conducting feasibility studies under paragraph (1); and
       (B) determining the feasibility of potential projects.
       (4) Feasibility.--For the purpose of a feasibility study 
     under paragraph (1), a project shall be determined to be 
     feasible if the project would significantly reduce the 
     dependence of an insular area on imported fossil fuels, or 
     provide needed distributed generation to an insular area, at 
     a reasonable cost.
       (b) Implementation.--
       (1) In general.--On a determination by the Secretary (in 
     consultation with the Secretary of the Interior) that a 
     project is feasible under subsection (a) and a commitment by 
     an electric utility to operate and maintain the project, the 
     Secretary may provide such technical and financial assistance 
     as the Secretary determines is appropriate for the 
     implementation of the project.
       (2) Regional utility organizations.--In providing 
     assistance under paragraph (1), the Secretary shall consider 
     providing the assistance through regional utility 
     organizations.
       (c) Authorization of Appropriations.--
       (1) In general.--There are authorized to be appropriated to 
     the Secretary--
       (A) $500,000 for each fiscal year for project feasibility 
     studies under subsection (a); and
       (B) $4,000,000 for each fiscal year for project 
     implementation under subsection (b).
       (2) Limitation of funds received by insular areas.--No 
     insular area may receive, during any 3-year period, more than 
     20 percent of the total funds made available during that 3-
     year period under subparagraphs (A) and (B) of paragraph (1) 
     unless the Secretary determines that providing funding in 
     excess of that percentage best advances existing 
     opportunities to meet the objectives of this section.
                         TITLE III--OIL AND GAS
           Subtitle A--Petroleum Reserve and Home Heating Oil

     SEC. 301. PERMANENT AUTHORITY TO OPERATE THE STRATEGIC 
                   PETROLEUM RESERVE AND OTHER ENERGY PROGRAMS.

       (a) Amendment to Title I of the Energy Policy and 
     Conservation Act.--Title I of the Energy Policy and 
     Conservation Act (42 U.S.C. 6212 et seq.) is amended--
       (1) by striking section 166 (42 U.S.C. 6246) and inserting 
     the following:


                   ``AUTHORIZATION OF APPROPRIATIONS

       ``Sec. 166. There are authorized to be appropriated to the 
     Secretary such sums as are necessary to carry out this part 
     and part D, to remain available until expended.'';
       (2) by striking section 186 (42 U.S.C. 6250e); and
       (3) by striking part E (42 U.S.C. 6251).
       (b) Amendment to Title II of the Energy Policy and 
     Conservation Act.--Title II of the Energy Policy and 
     Conservation Act (42 U.S.C. 6271 et seq.) is amended--
       (1) by inserting before section 273 (42 U.S.C. 6283) the 
     following:
          ``PART C--SUMMER FILL AND FUEL BUDGETING PROGRAMS'';
       (2) by striking section 273(e) (42 U.S.C. 6283(e)); and
       (3) by striking part D (42 U.S.C. 6285).
       (c) Technical Amendments.--The table of contents for the 
     Energy Policy and Conservation Act is amended--
       (1) by inserting after the items relating to part C of 
     title I the following:

              ``Part D--Northeast Home Heating Oil Reserve

``Sec. 181. Establishment.
``Sec. 182. Authority.
``Sec. 183. Conditions for release; plan.
``Sec. 184. Northeast Home Heating Oil Reserve Account.
``Sec. 185. Exemptions.'';

       (2) by amending the items relating to part C of title II to 
     read as follows:

           ``Part C--Summer Fill and Fuel Budgeting Programs

``Sec. 273. Summer fill and fuel budgeting programs.'';

       and
       (3) by striking the items relating to part D of title II.
       (d) Amendment to the Energy Policy and Conservation Act.--
     Section 183(b)(1) of the Energy Policy and Conservation Act 
     (42 U.S.C. 6250b(b)(1)) is amended by striking ``by more'' 
     and all that follows through ``mid-October through March'' 
     and inserting ``by more than 60 percent over its 5-year 
     rolling average for the months of mid-October through March 
     (considered as a heating season average)''.
       (e) Fill Strategic Petroleum Reserve to Capacity.--
       (1) In general.--The Secretary shall, as expeditiously as 
     practicable, without incurring excessive cost or appreciably 
     affecting the price of petroleum products to consumers, 
     acquire petroleum in quantities sufficient to fill the 
     Strategic Petroleum Reserve to the 1,000,000,000-barrel 
     capacity authorized under section 154(a) of the Energy Policy 
     and Conservation Act (42 U.S.C. 6234(a)), in accordance with 
     the sections 159 and 160 of that Act (42 U.S.C. 6239, 6240).
       (2) Procedures.--
       (A) Amendment.--Section 160 of the Energy Policy and 
     Conservation Act (42 U.S.C. 6240) is amended by inserting 
     after subsection (b) the following new subsection:
       ``(c) Procedures.--The Secretary shall develop, with public 
     notice and opportunity for comment, procedures consistent 
     with the objectives of this section to acquire petroleum for 
     the Reserve. Such procedures shall take into account the need 
     to--
       ``(1) maximize overall domestic supply of crude oil 
     (including quantities stored in private sector inventories);
       ``(2) avoid incurring excessive cost or appreciably 
     affecting the price of petroleum products to consumers;
       ``(3) minimize the costs to the Department of the Interior 
     and the Department of Energy in acquiring such petroleum 
     products (including foregone revenues to the Treasury when 
     petroleum products for the Reserve are obtained through the 
     royalty-in-kind program);
       ``(4) protect national security;
       ``(5) avoid adversely affecting current and futures prices, 
     supplies, and inventories of oil; and
       ``(6) address other factors that the Secretary determines 
     to be appropriate.''.
       (B) Review of requests for deferrals of scheduled 
     deliveries.--The procedures developed under section 160(c) of 
     the Energy Policy and Conservation Act, as added by 
     subparagraph (A), shall include procedures and criteria for 
     the review of requests for the deferrals of scheduled 
     deliveries.
       (C) Deadlines.--The Secretary shall--
       (i) propose the procedures required under the amendment 
     made by subparagraph (A) not later than 120 days after the 
     date of enactment of this Act;
       (ii) promulgate the procedures not later than 180 days 
     after the date of enactment of this Act; and
       (iii) comply with the procedures in acquiring petroleum for 
     the Reserve effective beginning on the date that is 180 days 
     after the date of enactment of this Act.

     SEC. 302. NATIONAL OILHEAT RESEARCH ALLIANCE.

       Section 713 of the Energy Act of 2000 (Public Law 106-469; 
     42 U.S.C. 6201 note) is amended by striking ``4'' and 
     inserting ``9''.

     SEC. 303. SITE SELECTION.

       Not later than 1 year after the date of enactment of this 
     Act, the Secretary shall complete a proceeding to select, 
     from sites that the Secretary has previously studied, sites 
     necessary to enable acquisition by the Secretary of the full 
     authorized volume of the Strategic Petroleum Reserve. In such 
     proceeding, the Secretary shall first consider and give 
     preference to the five sites which the Secretary previously 
     assessed in the Draft Environmental Impact Statement, DOE/
     EIS-0165-D. However, the Secretary in his discretion may 
     select other sites as proposed by a State where a site has 
     been previously studied by the Secretary to meet the full 
     authorized volume of the Strategic Petroleum Reserve.
                        Subtitle B--Natural Gas

     SEC. 311. EXPORTATION OR IMPORTATION OF NATURAL GAS.

       (a) Scope of Natural Gas Act.--Section 1(b) of the Natural 
     Gas Act (15 U.S.C. 717(b)) is amended by inserting ``and to 
     the importation or exportation of natural gas in foreign 
     commerce and to persons engaged in such importation or 
     exportation,'' after ``such transportation or sale,''.
       (b) Definition.--Section 2 of the Natural Gas Act (15 
     U.S.C. 717a) is amended by adding at the end the following 
     new paragraph:
       ``(11) `LNG terminal' includes all natural gas facilities 
     located onshore or in State waters that are used to receive, 
     unload, load, store, transport, gasify, liquefy, or process 
     natural gas that is imported to the United States from a 
     foreign country, exported to a foreign country from the 
     United States, or transported in interstate commerce by 
     waterborne vessel, but does not include--
       ``(A) waterborne vessels used to deliver natural gas to or 
     from any such facility; or
       ``(B) any pipeline or storage facility subject to the 
     jurisdiction of the Commission under section 7.''.
       (c) Authorization for Siting, Construction, Expansion, or 
     Operation of LNG Terminals.--(1) The title for section 3 of 
     the Natural Gas Act (15 U.S.C. 717b) is amended by inserting 
     ``; lng terminals'' after ``exportation or importation of 
     natural gas''.
       (2) Section 3 of the Natural Gas Act (15 U.S.C. 717b) is 
     amended by adding at the end the following:
       ``(d) Except as specifically provided in this Act, nothing 
     in this Act affects the rights of States under--
       ``(1) the Coastal Zone Management Act of 1972 (16 U.S.C. 
     1451 et seq.);
       ``(2) the Clean Air Act (42 U.S.C. 7401 et seq.); or
       ``(3) the Federal Water Pollution Control Act (33 U.S.C. 
     1251 et seq.).

[[Page 17820]]

       ``(e)(1) The Commission shall have the exclusive authority 
     to approve or deny an application for the siting, 
     construction, expansion, or operation of an LNG terminal. 
     Except as specifically provided in this Act, nothing in this 
     Act is intended to affect otherwise applicable law related to 
     any Federal agency's authorities or responsibilities related 
     to LNG terminals.
       ``(2) Upon the filing of any application to site, 
     construct, expand, or operate an LNG terminal, the Commission 
     shall--
       ``(A) set the matter for hearing;
       ``(B) give reasonable notice of the hearing to all 
     interested persons, including the State commission of the 
     State in which the LNG terminal is located and, if not the 
     same, the Governor-appointed State agency described in 
     section 3A;
       ``(C) decide the matter in accordance with this subsection; 
     and
       ``(D) issue or deny the appropriate order accordingly.
       ``(3)(A) Except as provided in subparagraph (B), the 
     Commission may approve an application described in paragraph 
     (2), in whole or part, with such modifications and upon such 
     terms and conditions as the Commission find necessary or 
     appropriate.
       ``(B) Before January 1, 2015, the Commission shall not--
       ``(i) deny an application solely on the basis that the 
     applicant proposes to use the LNG terminal exclusively or 
     partially for gas that the applicant or an affiliate of the 
     applicant will supply to the facility; or
       ``(ii) condition an order on--
       ``(I) a requirement that the LNG terminal offer service to 
     customers other than the applicant, or any affiliate of the 
     applicant, securing the order;
       ``(II) any regulation of the rates, charges, terms, or 
     conditions of service of the LNG terminal; or
       ``(III) a requirement to file with the Commission schedules 
     or contracts related to the rates, charges, terms, or 
     conditions of service of the LNG terminal.
       ``(C) Subparagraph (B) shall cease to have effect on 
     January 1, 2030.
       ``(4) An order issued for an LNG terminal that also offers 
     service to customers on an open access basis shall not result 
     in subsidization of expansion capacity by existing customers, 
     degradation of service to existing customers, or undue 
     discrimination against existing customers as to their terms 
     or conditions of service at the facility, as all of those 
     terms are defined by the Commission.
       ``(f)(1) In this subsection, the term `military 
     installation'--
       ``(A) means a base, camp, post, range, station, yard, 
     center, or homeport facility for any ship or other activity 
     under the jurisdiction of the Department of Defense, 
     including any leased facility, that is located within a 
     State, the District of Columbia, or any territory of the 
     United States; and
       ``(B) does not include any facility used primarily for 
     civil works, rivers and harbors projects, or flood control 
     projects, as determined by the Secretary of Defense.
       ``(2) The Commission shall enter into a memorandum of 
     understanding with the Secretary of Defense for the purpose 
     of ensuring that the Commission coordinate and consult with 
     the Secretary of Defense on the siting, construction, 
     expansion, or operation of liquefied natural gas facilities 
     that may affect an active military installation.
       ``(3) The Commission shall obtain the concurrence of the 
     Secretary of Defense before authorizing the siting, 
     construction, expansion, or operation of liquefied natural 
     gas facilities affecting the training or activities of an 
     active military installation.''.
       (d) LNG Terminal State and Local Safety Concerns.--After 
     section 3 of the Natural Gas Act (15 U.S.C. 717b) insert the 
     following:


                ``STATE AND LOCAL SAFETY CONSIDERATIONS

       ``Sec. 3A. (a) The Commission shall promulgate regulations 
     on the National Environmental Policy Act of 1969 (42 U.S.C. 
     4321 et seq) pre-filing process within 60 days after the date 
     of enactment of this section. An applicant shall comply with 
     pre-filing process required under the National Environmental 
     Policy Act of 1969 prior to filing an application with the 
     Commission. The regulations shall require that the pre-filing 
     process commence at least 6 months prior to the filing of an 
     application for authorization to construct an LNG terminal 
     and encourage applicants to cooperate with State and local 
     officials.
       ``(b) The Governor of a State in which an LNG terminal is 
     proposed to be located shall designate the appropriate State 
     agency for the purposes of consulting with the Commission 
     regarding an application under section 3. The Commission 
     shall consult with such State agency regarding State and 
     local safety considerations prior to issuing an order 
     pursuant to section 3. For the purposes of this section, 
     State and local safety considerations include--
       ``(1) the kind and use of the facility;
       ``(2) the existing and projected population and demographic 
     characteristics of the location;
       ``(3) the existing and proposed land use near the location;
       ``(4) the natural and physical aspects of the location;
       ``(5) the emergency response capabilities near the facility 
     location; and
       ``(6) the need to encourage remote siting.
       ``(c) The State agency may furnish an advisory report on 
     State and local safety considerations to the Commission with 
     respect to an application no later than 30 days after the 
     application was filed with the Commission. Before issuing an 
     order authorizing an applicant to site, construct, expand, or 
     operate an LNG terminal, the Commission shall review and 
     respond specifically to the issues raised by the State agency 
     described in subsection (b) in the advisory report. This 
     subsection shall apply to any application filed after the 
     date of enactment of the Energy Policy Act of 2005. A State 
     agency has 30 days after such date of enactment to file an 
     advisory report related to any applications pending at the 
     Commission as of such date of enactment.
       ``(d) The State commission of the State in which an LNG 
     terminal is located may, after the terminal is operational, 
     conduct safety inspections in conformance with Federal 
     regulations and guidelines with respect to the LNG terminal 
     upon written notice to the Commission. The State commission 
     may notify the Commission of any alleged safety violations. 
     The Commission shall transmit information regarding such 
     allegations to the appropriate Federal agency, which shall 
     take appropriate action and notify the State commission.
       ``(e)(1) In any order authorizing an LNG terminal the 
     Commission shall require the LNG terminal operator to develop 
     an Emergency Response Plan. The Emergency Response Plan shall 
     be prepared in consultation with the United States Coast 
     Guard and State and local agencies and be approved by the 
     Commission prior to any final approval to begin construction. 
     The Plan shall include a cost-sharing plan.
       ``(2) A cost-sharing plan developed under paragraph (1) 
     shall include a description of any direct cost reimbursements 
     that the applicant agrees to provide to any State and local 
     agencies with responsibility for security and safety--
       ``(A) at the LNG terminal; and
       ``(B) in proximity to vessels that serve the facility.''.

     SEC. 312. NEW NATURAL GAS STORAGE FACILITIES.

       Section 4 of the Natural Gas Act (15 U.S.C. 717c) is 
     amended by adding at the end the following:
       ``(f)(1) In exercising its authority under this Act or the 
     Natural Gas Policy Act of 1978 (15 U.S.C. 3301 et seq.), the 
     Commission may authorize a natural gas company (or any person 
     that will be a natural gas company on completion of any 
     proposed construction) to provide storage and storage-related 
     services at market-based rates for new storage capacity 
     related to a specific facility placed in service after the 
     date of enactment of the Energy Policy Act of 2005, 
     notwithstanding the fact that the company is unable to 
     demonstrate that the company lacks market power, if the 
     Commission determines that--
       ``(A) market-based rates are in the public interest and 
     necessary to encourage the construction of the storage 
     capacity in the area needing storage services; and
       ``(B) customers are adequately protected.
       ``(2) The Commission shall ensure that reasonable terms and 
     conditions are in place to protect consumers.
       ``(3) If the Commission authorizes a natural gas company to 
     charge market-based rates under this subsection, the 
     Commission shall review periodically whether the market-based 
     rate is just, reasonable, and not unduly discriminatory or 
     preferential.''.

     SEC. 313. PROCESS COORDINATION; HEARINGS; RULES OF PROCEDURE.

       (a) In General.--Section 15 of the Natural Gas Act (15 
     U.S.C. 717n) is amended--
       (1) by striking the section heading and inserting ``process 
     coordination; hearings; rules of procedure'';
       (2) by redesignating subsections (a) and (b) as subsections 
     (e) and (f), respectively; and
       (3) by striking ``sec. 15.'' and inserting the following:
       ``Sec. 15.(a) In this section, the term `Federal 
     authorization'--
       ``(1) means any authorization required under Federal law 
     with respect to an application for authorization under 
     section 3 or a certificate of public convenience and 
     necessity under section 7; and
       ``(2) includes any permits, special use authorizations, 
     certifications, opinions, or other approvals as may be 
     required under Federal law with respect to an application for 
     authorization under section 3 or a certificate of public 
     convenience and necessity under section 7.
       ``(b) Designation as Lead Agency.--
       ``(1) In general.--The Commission shall act as the lead 
     agency for the purposes of coordinating all applicable 
     Federal authorizations and for the purposes of complying with 
     the National Environmental Policy Act of 1969 (42 U.S.C. 4321 
     et seq.).
       ``(2) Other agencies.--Each Federal and State agency 
     considering an aspect of an application for Federal 
     authorization shall cooperate with the Commission and comply 
     with the deadlines established by the Commission.
       ``(c) Schedule.--
       ``(1) Commission authority to set schedule.--The Commission 
     shall establish a schedule for all Federal authorizations. In 
     establishing the schedule, the Commission shall--
       ``(A) ensure expeditious completion of all such 
     proceedings; and
       ``(B) comply with applicable schedules established by 
     Federal law.
       ``(2) Failure to meet schedule.--If a Federal or State 
     administrative agency does not complete a proceeding for an 
     approval that is required for a Federal authorization in 
     accordance with the schedule established by the Commission, 
     the applicant may pursue remedies under section 19(d).

[[Page 17821]]

       ``(d) Consolidated Record.--The Commission shall, with the 
     cooperation of Federal and State administrative agencies and 
     officials, maintain a complete consolidated record of all 
     decisions made or actions taken by the Commission or by a 
     Federal administrative agency or officer (or State 
     administrative agency or officer acting under delegated 
     Federal authority) with respect to any Federal authorization. 
     Such record shall be the record for--
       ``(1) appeals or reviews under the Coastal Zone Management 
     Act of 1972 (16 U.S.C. 1451 et seq.), provided that the 
     record may be supplemented as expressly provided pursuant to 
     section 319 of that Act; or
       ``(2) judicial review under section 19(d) of decisions made 
     or actions taken of Federal and State administrative agencies 
     and officials, provided that, if the Court determines that 
     the record does not contain sufficient information, the Court 
     may remand the proceeding to the Commission for further 
     development of the consolidated record.''.
       (b) Judicial Review.--Section 19 of the Natural Gas Act (15 
     U.S.C. 717r) is amended by adding at the end the following:
       ``(d) Judicial Review.--
       ``(1) In general.--The United States Court of Appeals for 
     the circuit in which a facility subject to section 3 or 
     section 7 is proposed to be constructed, expanded, or 
     operated shall have original and exclusive jurisdiction over 
     any civil action for the review of an order or action of a 
     Federal agency (other than the Commission) or State 
     administrative agency acting pursuant to Federal law to 
     issue, condition, or deny any permit, license, concurrence, 
     or approval ( hereinafter collectively referred to as 
     `permit') required under Federal law, other than the Coastal 
     Zone Management Act of 1972 (16 U.S.C. 1451 et seq.).
       ``(2) Agency delay.--The United States Court of Appeals for 
     the District of Columbia shall have original and exclusive 
     jurisdiction over any civil action for the review of an 
     alleged failure to act by a Federal agency (other than the 
     Commission) or State administrative agency acting pursuant to 
     Federal law to issue, condition, or deny any permit required 
     under Federal law, other than the Coastal Zone Management Act 
     of 1972 (16 U.S.C. 1451 et seq.), for a facility subject to 
     section 3 or section 7. The failure of an agency to take 
     action on a permit required under Federal law, other than the 
     Coastal Zone Management Act of 1972, in accordance with the 
     Commission schedule established pursuant to section 15(c) 
     shall be considered inconsistent with Federal law for the 
     purposes of paragraph (3).
       ``(3) Court action.--If the Court finds that such order or 
     action is inconsistent with the Federal law governing such 
     permit and would prevent the construction, expansion, or 
     operation of the facility subject to section 3 or section 7, 
     the Court shall remand the proceeding to the agency to take 
     appropriate action consistent with the order of the Court. If 
     the Court remands the order or action to the Federal or State 
     agency, the Court shall set a reasonable schedule and 
     deadline for the agency to act on remand.
       ``(4) Commission action.--For any action described in this 
     subsection, the Commission shall file with the Court the 
     consolidated record of such order or action to which the 
     appeal hereunder relates.
       ``(5) Expedited review.--The Court shall set any action 
     brought under this subsection for expedited consideration.''.

     SEC. 314. PENALTIES.

       (a) Criminal Penalties.--
       (1) Natural gas act.--Section 21 of the Natural Gas Act (15 
     U.S.C. 717t) is amended--
       (A) in subsection (a)--
       (i) by striking ``$5,000'' and inserting ``$1,000,000''; 
     and
       (ii) by striking ``two years'' and inserting ``5 years''; 
     and
       (B) in subsection (b), by striking ``$500'' and inserting 
     ``$50,000''.
       (2) Natural gas policy act of 1978.--Section 504(c) of the 
     Natural Gas Policy Act of 1978 (15 U.S.C. 3414(c)) is 
     amended--
       (A) in paragraph (1)--
       (i) in subparagraph (A), by striking ``$5,000'' and 
     inserting ``$1,000,000''; and
       (ii) in subparagraph (B), by striking ``two years'' and 
     inserting ``5 years''; and
       (B) in paragraph (2), by striking ``$500 for each 
     violation'' and inserting ``$50,000 for each day on which the 
     offense occurs''.
       (b) Civil Penalties.--
       (1) Natural gas act.--The Natural Gas Act (15 U.S.C. 717 et 
     seq.) is amended--
       (A) by redesignating sections 22 through 24 as sections 24 
     through 26, respectively; and
       (B) by inserting after section 21 (15 U.S.C. 717t) the 
     following:


                       ``CIVIL PENALTY AUTHORITY

       ``Sec. 22. (a) Any person that violates this Act, or any 
     rule, regulation, restriction, condition, or order made or 
     imposed by the Commission under authority of this Act, shall 
     be subject to a civil penalty of not more than $1,000,000 per 
     day per violation for as long as the violation continues.
       ``(b) The penalty shall be assessed by the Commission after 
     notice and opportunity for public hearing.
       ``(c) In determining the amount of a proposed penalty, the 
     Commission shall take into consideration the nature and 
     seriousness of the violation and the efforts to remedy the 
     violation.''.
       (2) Natural gas policy act of 1978.--Section 504(b)(6)(A) 
     of the Natural Gas Policy Act of 1978 (15 U.S.C. 
     3414(b)(6)(A)) is amended--
       (A) in clause (i), by striking ``$5,000'' and inserting 
     ``$1,000,000''; and
       (B) in clause (ii), by striking ``$25,000'' and inserting 
     ``$1,000,000''.

     SEC. 315. MARKET MANIPULATION.

       The Natural Gas Act is amended by inserting after section 4 
     (15 U.S.C. 717c) the following:


                  ``PROHIBITION ON MARKET MANIPULATION

       ``Sec. 4A. It shall be unlawful for any entity, directly or 
     indirectly, to use or employ, in connection with the purchase 
     or sale of natural gas or the purchase or sale of 
     transportation services subject to the jurisdiction of the 
     Commission, any manipulative or deceptive device or 
     contrivance (as those terms are used in section 10(b) of the 
     Securities Exchange Act of 1934 (15 U.S.C. 78j(b))) in 
     contravention of such rules and regulations as the Commission 
     may prescribe as necessary in the public interest or for the 
     protection of natural gas ratepayers. Nothing in this section 
     shall be construed to create a private right of action.''.

     SEC. 316. NATURAL GAS MARKET TRANSPARENCY RULES.

       The Natural Gas Act (15 U.S.C. 717 et seq.) is amended by 
     inserting after section 22 the following:


                ``NATURAL GAS MARKET TRANSPARENCY RULES

       ``Sec. 23. (a)(1) The Commission is directed to facilitate 
     price transparency in markets for the sale or transportation 
     of physical natural gas in interstate commerce, having due 
     regard for the public interest, the integrity of those 
     markets, fair competition, and the protection of consumers.
       ``(2) The Commission may prescribe such rules as the 
     Commission determines necessary and appropriate to carry out 
     the purposes of this section. The rules shall provide for the 
     dissemination, on a timely basis, of information about the 
     availability and prices of natural gas sold at wholesale and 
     in interstate commerce to the Commission, State commissions, 
     buyers and sellers of wholesale natural gas, and the public.
       ``(3) The Commission may--
       ``(A) obtain the information described in paragraph (2) 
     from any market participant; and
       ``(B) rely on entities other than the Commission to receive 
     and make public the information, subject to the disclosure 
     rules in subsection (b).
       ``(4) In carrying out this section, the Commission shall 
     consider the degree of price transparency provided by 
     existing price publishers and providers of trade processing 
     services, and shall rely on such publishers and services to 
     the maximum extent possible. The Commission may establish an 
     electronic information system if it determines that existing 
     price publications are not adequately providing price 
     discovery or market transparency.
       ``(b)(1) Rules described in subsection (a)(2), if adopted, 
     shall exempt from disclosure information the Commission 
     determines would, if disclosed, be detrimental to the 
     operation of an effective market or jeopardize system 
     security.
       ``(2) In determining the information to be made available 
     under this section and the time to make the information 
     available, the Commission shall seek to ensure that consumers 
     and competitive markets are protected from the adverse 
     effects of potential collusion or other anticompetitive 
     behaviors that can be facilitated by untimely public 
     disclosure of transaction-specific information.
       ``(c)(1) Within 180 days of enactment of this section, the 
     Commission shall conclude a memorandum of understanding with 
     the Commodity Futures Trading Commission relating to 
     information sharing, which shall include, among other things, 
     provisions ensuring that information requests to markets 
     within the respective jurisdiction of each agency are 
     properly coordinated to minimize duplicative information 
     requests, and provisions regarding the treatment of 
     proprietary trading information.
       ``(2) Nothing in this section may be construed to limit or 
     affect the exclusive jurisdiction of the Commodity Futures 
     Trading Commission under the Commodity Exchange Act (7 U.S.C. 
     1 et seq.).
       ``(d)(1) The Commission shall not condition access to 
     interstate pipeline transportation on the reporting 
     requirements of this section.
       ``(2) The Commission shall not require natural gas 
     producers, processors, or users who have a de minimis market 
     presence to comply with the reporting requirements of this 
     section.
       ``(e)(1) Except as provided in paragraph (2), no person 
     shall be subject to any civil penalty under this section with 
     respect to any violation occurring more than 3 years before 
     the date on which the person is provided notice of the 
     proposed penalty under section 22(b).
       ``(2) Paragraph (1) shall not apply in any case in which 
     the Commission finds that a seller that has entered into a 
     contract for the transportation or sale of natural gas 
     subject to the jurisdiction of the Commission has engaged in 
     fraudulent market manipulation activities materially 
     affecting the contract in violation of section 4A.''.

     SEC. 317. FEDERAL-STATE LIQUEFIED NATURAL GAS FORUMS.

       (a) In General.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary, in cooperation and 
     consultation with the Secretary of Transportation, the 
     Secretary of Homeland Security, the Federal Energy Regulatory 
     Commission, and the Governors of the Coastal States, shall 
     convene not less than 3 forums on liquefied natural gas.
       (b) Requirements.--The forums shall--
       (1) be located in areas where liquefied natural gas 
     facilities are under consideration;

[[Page 17822]]

       (2) be designed to foster dialogue among Federal officials, 
     State and local officials, the general public, independent 
     experts, and industry representatives; and
       (3) at a minimum, provide an opportunity for public 
     education and dialogue on--
       (A) the role of liquefied natural gas in meeting current 
     and future United States energy supply requirements and 
     demand, in the context of the full range of energy supply 
     options;
       (B) the Federal and State siting and permitting processes;
       (C) the potential risks and rewards associated with 
     importing liquefied natural gas;
       (D) the Federal safety and environmental requirements 
     (including regulations) applicable to liquefied natural gas;
       (E) prevention, mitigation, and response strategies for 
     liquefied natural gas hazards; and
       (F) additional issues as appropriate.
       (c) Purpose.--The purpose of the forums shall be to 
     identify and develop best practices for addressing the issues 
     and challenges associated with liquefied natural gas imports, 
     building on existing cooperative efforts.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section.

     SEC. 318. PROHIBITION OF TRADING AND SERVING BY CERTAIN 
                   INDIVIDUALS.

       Section 20 of the Natural Gas Act (15 U.S.C. 717s) is 
     amended by adding at the end the following:
       ``(d) In any proceedings under subsection (a), the court 
     may prohibit, conditionally or unconditionally, and 
     permanently or for such period of time as the court 
     determines, any individual who is engaged or has engaged in 
     practices constituting a violation of section 4A (including 
     related rules and regulations) from--
       ``(1) acting as an officer or director of a natural gas 
     company; or
       ``(2) engaging in the business of--
       ``(A) the purchasing or selling of natural gas; or
       ``(B) the purchasing or selling of transmission services 
     subject to the jurisdiction of the Commission.''.
                         Subtitle C--Production

     SEC. 321. OUTER CONTINENTAL SHELF PROVISIONS.

       (a) Storage on the Outer Continental Shelf.--Section 
     5(a)(5) of the Outer Continental Shelf Lands Act (43 U.S.C. 
     1334(a)(5)) is amended by inserting ``from any source'' after 
     ``oil and gas''.
       (b) Natural Gas Defined.--Section 3(13) of the Deepwater 
     Port Act of 1974 (33 U.S.C. 1502(13)) is amended by adding at 
     the end before the semicolon the following: ``, natural gas 
     liquids, liquefied petroleum gas, and condensate recovered 
     from natural gas''.

     SEC. 322. HYDRAULIC FRACTURING.

       Paragraph (1) of section 1421(d) of the Safe Drinking Water 
     Act (42 U.S.C. 300h(d)) is amended to read as follows:
       ``(1) Underground injection.--The term `underground 
     injection'--
       ``(A) means the subsurface emplacement of fluids by well 
     injection; and
       ``(B) excludes--
       ``(i) the underground injection of natural gas for purposes 
     of storage; and
       ``(ii) the underground injection of fluids or propping 
     agents (other than diesel fuels) pursuant to hydraulic 
     fracturing operations related to oil, gas, or geothermal 
     production activities.''.

     SEC. 323. OIL AND GAS EXPLORATION AND PRODUCTION DEFINED.

       Section 502 of the Federal Water Pollution Control Act (33 
     U.S.C. 1362) is amended by adding at the end the following:
       ``(24) Oil and gas exploration and production.--The term 
     `oil and gas exploration, production, processing, or 
     treatment operations or transmission facilities' means all 
     field activities or operations associated with exploration, 
     production, processing, or treatment operations, or 
     transmission facilities, including activities necessary to 
     prepare a site for drilling and for the movement and 
     placement of drilling equipment, whether or not such field 
     activities or operations may be considered to be construction 
     activities.''.
                  Subtitle D--Naval Petroleum Reserve

     SEC. 331. TRANSFER OF ADMINISTRATIVE JURISDICTION AND 
                   ENVIRONMENTAL REMEDIATION, NAVAL PETROLEUM 
                   RESERVE NUMBERED 2, KERN COUNTY, CALIFORNIA.

       (a) Administration Jurisdiction Transfer to Secretary of 
     the Interior.--Effective on the date of the enactment of this 
     Act, administrative jurisdiction and control over all public 
     domain lands included within Naval Petroleum Reserve Numbered 
     2 located in Kern County, California, (other than the lands 
     specified in subsection (b)) are transferred from the 
     Secretary to the Secretary of the Interior for management, 
     subject to subsection (c), in accordance with the laws 
     governing management of the public lands, and the regulations 
     promulgated under such laws, including the Mineral Leasing 
     Act (30 U.S.C. 181 et seq.) and the Federal Land Policy and 
     Management Act of 1976 (43 U.S.C. 1701 et seq.).
       (b) Exclusion of Certain Reserve Lands.--The transfer of 
     administrative jurisdiction made by subsection (a) does not 
     include the following lands:
       (1) That portion of Naval Petroleum Reserve Numbered 2 
     authorized for disposal under section 3403(a) of the Strom 
     Thurmond National Defense Authorization Act for Fiscal Year 
     1999 (Public Law 105-261; 10 U.S.C. 7420 note).
       (2) That portion of the surface estate of Naval Petroleum 
     Reserve Numbered 2 conveyed to the City of Taft, California, 
     by section 333.
       (c) Purpose of Transfer.--
       (1) Production of hydrocarbon resources.--Notwithstanding 
     any other provision of law, the principal purpose of the 
     lands subject to transfer under subsection (a) is the 
     production of hydrocarbon resources, and the Secretary of the 
     Interior shall manage the lands in a fashion consistent with 
     this purpose. In managing the lands, the Secretary of the 
     Interior shall regulate operations to prevent unnecessary 
     degradation and to provide for ultimate economic recovery of 
     the resources.
       (2) Disposal authority and surface use.--The Secretary of 
     the Interior may make disposals of lands subject to transfer 
     under subsection (a), or allow commercial or non-profit 
     surface use of such lands, not to exceed 10 acres each, so 
     long as the disposals or surface uses do not materially 
     interfere with the ultimate economic recovery of the 
     hydrocarbon resources of such lands. All revenues received 
     from the disposal of lands under this paragraph or from 
     allowing the surface use of such lands shall be deposited in 
     the Naval Petroleum Reserve Numbered 2 Lease Revenue Account 
     established by section 332.
       (d) Conforming Amendment.--Section 3403 of the Strom 
     Thurmond National Defense Authorization Act for Fiscal Year 
     1999 (Public Law 105-261; 10 U.S.C 7420 note) is amended by 
     striking subsection (b).

     SEC. 332. NAVAL PETROLEUM RESERVE NUMBERED 2 LEASE REVENUE 
                   ACCOUNT.

       (a) Establishment.--There is established in the Treasury a 
     special deposit account to be known as the ``Naval Petroleum 
     Reserve Numbered 2 Lease Revenue Account'' (in this section 
     referred to as the ``lease revenue account''). The lease 
     revenue account is a revolving account, and amounts in the 
     lease revenue account shall be available to the Secretary of 
     the Interior, without further appropriation, for the purposes 
     specified in subsection (b).
       (b) Purposes of Account.--
       (1) Environmental-related costs.--The lease revenue account 
     shall be the sole and exclusive source of funds to pay for 
     any and all costs and expenses incurred by the United States 
     for--
       (A) environmental investigations (other than any 
     environmental investigations that were conducted by the 
     Secretary before the transfer of the Naval Petroleum Reserve 
     Numbered 2 lands under section 331), remediation, compliance 
     actions, response, waste management, impediments, fines or 
     penalties, or any other costs or expenses of any kind arising 
     from, or relating to, conditions existing on or below the 
     Naval Petroleum Reserve Numbered 2 lands, or activities 
     occurring or having occurred on such lands, on or before the 
     date of the transfer of such lands; and
       (B) any future remediation necessitated as a result of pre-
     transfer and leasing activities on such lands.
       (2) Transition costs.--The lease revenue account shall also 
     be available for use by the Secretary of the Interior to pay 
     for transition costs incurred by the Department of the 
     Interior associated with the transfer and leasing of the 
     Naval Petroleum Reserve Numbered 2 lands.
       (c) Funding.--The lease revenue account shall consist of 
     the following:
       (1) Notwithstanding any other provision of law, for a 
     period of three years after the date of the transfer of the 
     Naval Petroleum Reserve Numbered 2 lands under section 331, 
     the sum of $500,000 per year of revenue from leases entered 
     into before that date, including bonuses, rents, royalties, 
     and interest charges collected pursuant to the Federal Oil 
     and Gas Royalty Management Act of 1982 (30 U.S.C. 1701 et. 
     seq.), derived from the Naval Petroleum Reserve Numbered 2 
     lands, shall be deposited into the lease revenue account.
       (2) Subject to subsection (d), all revenues derived from 
     leases on Naval Petroleum Reserve Numbered 2 lands issued on 
     or after the date of the transfer of such lands, including 
     bonuses, rents, royalties, and interest charges collected 
     pursuant to the Federal Oil and Gas Royalty Management Act of 
     1982 (30 U.S.C. 1701 et seq.), shall be deposited into the 
     lease revenue account.
       (d) Limitation.--Funds in the lease revenue account shall 
     not exceed $3,000,000 at any one time. Whenever funds in the 
     lease revenue account are obligated or expended so that the 
     balance in the account falls below that amount, lease 
     revenues referred to in subsection (c)(2) shall be deposited 
     in the account to maintain a balance of $3,000,000.
       (e) Termination of Account.--At such time as the Secretary 
     of the Interior certifies that remediation of all 
     environmental contamination of Naval Petroleum Reserve 
     Numbered 2 lands in existence as of the date of the transfer 
     of such lands under section 331 has been successfully 
     completed, that all costs and expenses of investigation, 
     remediation, compliance actions, response, waste management, 
     impediments, fines, or penalties associated with 
     environmental contamination of such lands in existence as of 
     the date of the transfer have been paid in full, and that the 
     transition costs of the Department of the Interior referred 
     to in subsection (b)(2) have been paid in full, the lease 
     revenue account shall be terminated and any remaining funds 
     shall be distributed in accordance with subsection (f).
       (f) Distribution of Remaining Funds.--Section 35 of the 
     Mineral Leasing Act (30 U.S.C. 191) shall apply to the 
     payment and distribution of all funds remaining in the lease 
     revenue account upon its termination under subsection (e).

[[Page 17823]]



     SEC. 333. LAND CONVEYANCE, PORTION OF NAVAL PETROLEUM RESERVE 
                   NUMBERED 2, TO CITY OF TAFT, CALIFORNIA.

       (a) Conveyance.--Effective on the date of the enactment of 
     this Act, there is conveyed to the City of Taft, California 
     (in this section referred to as the ``City''), all surface 
     right, title, and interest of the United States in and to a 
     parcel of real property consisting of approximately 220 acres 
     located in the NE\1/4\, the NE\1/4\ of the NW\1/4\, and the 
     N\1/2\ of the SE\1/4\ of the NW\1/4\ of section 18, township 
     32 south, range 24 east, Mount Diablo meridian, Kern County, 
     California.
       (b) Consideration.--The conveyance under subsection (a) is 
     made without the payment of consideration by the City.
       (c) Treatment of Existing Rights.--The conveyance under 
     subsection (a) is subject to valid existing rights, including 
     Federal oil and gas lease SAC--019577.
       (d) Treatment of Minerals.--All coal, oil, gas, and other 
     minerals within the lands conveyed under subsection (a) are 
     reserved to the United States, except that the United States 
     and its lessees, licensees, permittees, or assignees shall 
     have no right of surface use or occupancy of the lands. 
     Nothing in this subsection shall be construed to require the 
     United States or its lessees, licensees, permittees, or 
     assignees to support the surface of the conveyed lands.
       (e) Indemnify and Hold Harmless.--The City shall indemnify, 
     defend, and hold harmless the United States for, from, and 
     against, and the City shall assume all responsibility for, 
     any and all liability of any kind or nature, including all 
     loss, cost, expense, or damage, arising from the City's use 
     or occupancy of, or operations on, the land conveyed under 
     subsection (a), whether such use or occupancy of, or 
     operations on, occurred before or occur after the date of the 
     enactment of this Act.
       (f) Instrument of Conveyance.--Not later than one year 
     after the date of the enactment of this Act, the Secretary 
     shall execute, file, and cause to be recorded in the 
     appropriate office a deed or other appropriate instrument 
     documenting the conveyance made by this section.

     SEC. 334. REVOCATION OF LAND WITHDRAWAL.

       Effective on the date of the enactment of this Act, the 
     Executive Order of December 13, 1912, which created Naval 
     Petroleum Reserve Numbered 2, is revoked in its entirety.
                   Subtitle E--Production Incentives

     SEC. 341. DEFINITION OF SECRETARY.

       In this subtitle, the term ``Secretary'' means the 
     Secretary of the Interior.

     SEC. 342. PROGRAM ON OIL AND GAS ROYALTIES IN-KIND.

       (a) Applicability of Section.--Notwithstanding any other 
     provision of law, this section applies to all royalty in-kind 
     accepted by the Secretary on or after the date of enactment 
     of this Act under any Federal oil or gas lease or permit 
     under--
       (1) section 36 of the Mineral Leasing Act (30 U.S.C. 192);
       (2) section 27 of the Outer Continental Shelf Lands Act (43 
     U.S.C. 1353); or
       (3) any other Federal law governing leasing of Federal land 
     for oil and gas development.
       (b) Terms and Conditions.--All royalty accruing to the 
     United States shall, on the demand of the Secretary, be paid 
     in-kind. If the Secretary makes such a demand, the following 
     provisions apply to the payment:
       (1) Satisfaction of royalty obligation.--Delivery by, or on 
     behalf of, the lessee of the royalty amount and quality due 
     under the lease satisfies royalty obligation of the lessee 
     for the amount delivered, except that transportation and 
     processing reimbursements paid to, or deductions claimed by, 
     the lessee shall be subject to review and audit.
       (2) Marketable condition.--
       (A) Definition of marketable condition.--In this paragraph, 
     the term ``in marketable condition'' means sufficiently free 
     from impurities and otherwise in a condition that the royalty 
     production will be accepted by a purchaser under a sales 
     contract typical of the field or area in which the royalty 
     production was produced.
       (B) Requirement.--Royalty production shall be placed in 
     marketable condition by the lessee at no cost to the United 
     States.
       (3) Disposition by the secretary.--The Secretary may--
       (A) sell or otherwise dispose of any royalty production 
     taken in-kind (other than oil or gas transferred under 
     section 27(a)(3) of the Outer Continental Shelf Lands Act (43 
     U.S.C. 1353(a)(3)) for not less than the market price; and
       (B) transport or process (or both) any royalty production 
     taken in-kind.
       (4) Retention by the secretary.--The Secretary may, 
     notwithstanding section 3302 of title 31, United States Code, 
     retain and use a portion of the revenues from the sale of oil 
     and gas taken in-kind that otherwise would be deposited to 
     miscellaneous receipts, without regard to fiscal year 
     limitation, or may use oil or gas received as royalty taken 
     in-kind (referred to in this paragraph as ``royalty 
     production'') to pay the cost of--
       (A) transporting the royalty production;
       (B) processing the royalty production;
       (C) disposing of the royalty production; or
       (D) any combination of transporting, processing, and 
     disposing of the royalty production.
       (5) Limitation.--
       (A) In general.--Except as provided in subparagraph (B), 
     the Secretary may not use revenues from the sale of oil and 
     gas taken in-kind to pay for personnel, travel, or other 
     administrative costs of the Federal Government.
       (B) Exception.--Notwithstanding subparagraph (A), the 
     Secretary may use a portion of the revenues from royalty in-
     kind sales, without fiscal year limitation, to pay salaries 
     and other administrative costs directly related to the 
     royalty in-kind program.
       (c) Reimbursement of Cost.--If the lessee, pursuant to an 
     agreement with the United States or as provided in the lease, 
     processes the royalty gas or delivers the royalty oil or gas 
     at a point not on or adjacent to the lease area, the 
     Secretary shall--
       (1) reimburse the lessee for the reasonable costs of 
     transportation (not including gathering) from the lease to 
     the point of delivery or for processing costs; or
       (2) allow the lessee to deduct the transportation or 
     processing costs in reporting and paying royalties in-value 
     for other Federal oil and gas leases.
       (d) Benefit to the United States Required.--The Secretary 
     may receive oil or gas royalties in-kind only if the 
     Secretary determines that receiving royalties in-kind 
     provides benefits to the United States that are greater than 
     or equal to the benefits that are likely to have been 
     received had royalties been taken in-value.
       (e) Reports.--
       (1) In general.--Not later than September 30, 2006, the 
     Secretary shall submit to Congress a report that addresses--
       (A) actions taken to develop business processes and 
     automated systems to fully support the royalty-in-kind 
     capability to be used in tandem with the royalty-in-value 
     approach in managing Federal oil and gas revenue; and
       (B) future royalty-in-kind businesses operation plans and 
     objectives.
       (2) Reports on oil or gas royalties taken in-kind.--For 
     each of fiscal years 2006 through 2015 in which the United 
     States takes oil or gas royalties in-kind from production in 
     any State or from the outer Continental Shelf, excluding 
     royalties taken in-kind and sold to refineries under 
     subsection (h), the Secretary shall submit to Congress a 
     report that describes--
       (A) the 1 or more methodologies used by the Secretary to 
     determine compliance with subsection (d), including the 
     performance standard for comparing amounts received by the 
     United States derived from royalties in-kind to amounts 
     likely to have been received had royalties been taken in-
     value;
       (B) an explanation of the evaluation that led the Secretary 
     to take royalties in-kind from a lease or group of leases, 
     including the expected revenue effect of taking royalties in-
     kind;
       (C) actual amounts received by the United States derived 
     from taking royalties in-kind and costs and savings incurred 
     by the United States associated with taking royalties in-
     kind, including administrative savings and any new or 
     increased administrative costs; and
       (D) an evaluation of other relevant public benefits or 
     detriments associated with taking royalties in-kind.
       (f) Deduction of Expenses.--
       (1) In general.--Before making payments under section 35 of 
     the Mineral Leasing Act (30 U.S.C. 191) or section 8(g) of 
     the Outer Continental Shelf Lands Act (43 U.S.C. 1337(g)) of 
     revenues derived from the sale of royalty production taken 
     in-kind from a lease, the Secretary shall deduct amounts paid 
     or deducted under subsections (b)(4) and (c) and deposit the 
     amount of the deductions in the miscellaneous receipts of the 
     Treasury.
       (2) Accounting for deductions.--When the Secretary allows 
     the lessee to deduct transportation or processing costs under 
     subsection (c), the Secretary may not reduce any payments to 
     recipients of revenues derived from any other Federal oil and 
     gas lease as a consequence of that deduction.
       (g) Consultation With States.--The Secretary--
       (1) shall consult with a State before conducting a royalty 
     in-kind program under this subtitle within the State;
       (2) may delegate management of any portion of the Federal 
     royalty in-kind program to the State except as otherwise 
     prohibited by Federal law; and
       (3) shall consult annually with any State from which 
     Federal oil or gas royalty is being taken in-kind to ensure, 
     to the maximum extent practicable, that the royalty in-kind 
     program provides revenues to the State greater than or equal 
     to the revenues likely to have been received had royalties 
     been taken in-value.
       (h) Small Refineries.--
       (1) Preference.--If the Secretary finds that sufficient 
     supplies of crude oil are not available in the open market to 
     refineries that do not have their own source of supply for 
     crude oil, the Secretary may grant preference to those 
     refineries in the sale of any royalty oil accruing or 
     reserved to the United States under Federal oil and gas 
     leases issued under any mineral leasing law, for processing 
     or use in those refineries at private sale at not less than 
     the market price.
       (2) Proration among refineries in production area.--In 
     disposing of oil under this subsection, the Secretary may, at 
     the discretion of the Secretary, prorate the oil among 
     refineries described in paragraph (1) in the area in which 
     the oil is produced.
       (i) Disposition to Federal Agencies.--
       (1) Onshore royalty.--Any royalty oil or gas taken by the 
     Secretary in-kind from onshore oil and gas leases may be sold 
     at not less than the market price to any Federal agency.
       (2) Offshore royalty.--Any royalty oil or gas taken in-kind 
     from a Federal oil or gas lease

[[Page 17824]]

     on the outer Continental Shelf may be disposed of only under 
     section 27 of the Outer Continental Shelf Lands Act (43 
     U.S.C. 1353).
       (j) Federal Low-Income Energy Assistance Programs.--
       (1) Preference.--In disposing of royalty oil or gas taken 
     in-kind under this section, the Secretary may grant a 
     preference to any person, including any Federal or State 
     agency, for the purpose of providing additional resources to 
     any Federal low-income energy assistance program.
       (2) Report.--Not later than 3 years after the date of 
     enactment of this Act, the Secretary shall submit a report to 
     Congress--
       (A) assessing the effectiveness of granting preferences 
     specified in paragraph (1); and
       (B) providing a specific recommendation on the continuation 
     of authority to grant preferences.

     SEC. 343. MARGINAL PROPERTY PRODUCTION INCENTIVES.

       (a) Definition of Marginal Property.--Until such time as 
     the Secretary issues regulations under subsection (e) that 
     prescribe a different definition, in this section, the term 
     ``marginal property'' means an onshore unit, communitization 
     agreement, or lease not within a unit or communitization 
     agreement, that produces on average the combined equivalent 
     of less than 15 barrels of oil per well per day or 90,000,000 
     British thermal units of gas per well per day calculated 
     based on the average over the 3 most recent production 
     months, including only wells that produce on more than half 
     of the days during those 3 production months.
       (b) Conditions for Reduction of Royalty Rate.--Until such 
     time as the Secretary issues regulations under subsection (e) 
     that prescribe different standards or requirements, the 
     Secretary shall reduce the royalty rate on--
       (1) oil production from marginal properties as prescribed 
     in subsection (c) if the spot price of West Texas 
     Intermediate crude oil at Cushing, Oklahoma, is, on average, 
     less than $15 per barrel (adjusted in accordance with the 
     Consumer Price Index for all-urban consumers, United States 
     city average, as published by the Bureau of Labor Statistics) 
     for 90 consecutive trading days; and
       (2) gas production from marginal properties as prescribed 
     in subsection (c) if the spot price of natural gas delivered 
     at Henry Hub, Louisiana, is, on average, less than $2.00 per 
     million British thermal units (adjusted in accordance with 
     the Consumer Price Index for all-urban consumers, United 
     States city average, as published by the Bureau of Labor 
     Statistics) for 90 consecutive trading days.
       (c) Reduced Royalty Rate.--
       (1) In general.--When a marginal property meets the 
     conditions specified in subsection (b), the royalty rate 
     shall be the lesser of--
       (A) 5 percent; or
       (B) the applicable rate under any other statutory or 
     regulatory royalty relief provision that applies to the 
     affected production.
       (2) Period of effectiveness.--The reduced royalty rate 
     under this subsection shall be effective beginning on the 
     first day of the production month following the date on which 
     the applicable condition specified in subsection (b) is met.
       (d) Termination of Reduced Royalty Rate.--A royalty rate 
     prescribed in subsection (c)(1) shall terminate--
       (1) with respect to oil production from a marginal 
     property, on the first day of the production month following 
     the date on which--
       (A) the spot price of West Texas Intermediate crude oil at 
     Cushing, Oklahoma, on average, exceeds $15 per barrel 
     (adjusted in accordance with the Consumer Price Index for 
     all-urban consumers, United States city average, as published 
     by the Bureau of Labor Statistics) for 90 consecutive trading 
     days; or
       (B) the property no longer qualifies as a marginal 
     property; and
       (2) with respect to gas production from a marginal 
     property, on the first day of the production month following 
     the date on which--
       (A) the spot price of natural gas delivered at Henry Hub, 
     Louisiana, on average, exceeds $2.00 per million British 
     thermal units (adjusted in accordance with the Consumer Price 
     Index for all-urban consumers, United States city average, as 
     published by the Bureau of Labor Statistics) for 90 
     consecutive trading days; or
       (B) the property no longer qualifies as a marginal 
     property.
       (e) Regulations Prescribing Different Relief.--
       (1) Discretionary regulations.--The Secretary may by 
     regulation prescribe different parameters, standards, and 
     requirements for, and a different degree or extent of, 
     royalty relief for marginal properties in lieu of those 
     prescribed in subsections (a) through (d).
       (2) Mandatory regulations.--Unless a determination is made 
     under paragraph (3), not later than 18 months after the date 
     of enactment of this Act, the Secretary shall by regulation--
       (A) prescribe standards and requirements for, and the 
     extent of royalty relief for, marginal properties for oil and 
     gas leases on the outer Continental Shelf; and
       (B) define what constitutes a marginal property on the 
     outer Continental Shelf for purposes of this section.
       (3) Report.--To the extent the Secretary determines that it 
     is not practicable to issue the regulations referred to in 
     paragraph (2), the Secretary shall provide a report to 
     Congress explaining such determination by not later than 18 
     months after the date of enactment of this Act.
       (4) Considerations.--In issuing regulations under this 
     subsection, the Secretary may consider--
       (A) oil and gas prices and market trends;
       (B) production costs;
       (C) abandonment costs;
       (D) Federal and State tax provisions and the effects of 
     those provisions on production economics;
       (E) other royalty relief programs;
       (F) regional differences in average wellhead prices;
       (G) national energy security issues; and
       (H) other relevant matters, as determined by the Secretary.
       (f) Savings Provision.--Nothing in this section prevents a 
     lessee from receiving royalty relief or a royalty reduction 
     pursuant to any other law (including a regulation) that 
     provides more relief than the amounts provided by this 
     section.

     SEC. 344. INCENTIVES FOR NATURAL GAS PRODUCTION FROM DEEP 
                   WELLS IN THE SHALLOW WATERS OF THE GULF OF 
                   MEXICO.

       (a) Royalty Incentive Regulations for Ultra Deep Gas 
     Wells.--
       (1) In general.--Not later than 180 days after the date of 
     enactment of this Act, in addition to any other regulations 
     that may provide royalty incentives for natural gas produced 
     from deep wells on oil and gas leases issued pursuant to the 
     Outer Continental Shelf Lands Act (43 U.S.C. 1331 et seq.), 
     the Secretary shall issue regulations granting royalty relief 
     suspension volumes of not less than 35 billion cubic feet 
     with respect to the production of natural gas from ultra deep 
     wells on leases issued in shallow waters less than 400 meters 
     deep located in the Gulf of Mexico wholly west of 87 degrees, 
     30 minutes west longitude. Regulations issued under this 
     subsection shall be retroactive to the date that the notice 
     of proposed rulemaking is published in the Federal Register.
       (2) Suspension volumes.--The Secretary may grant suspension 
     volumes of not less than 35 billion cubic feet in any case in 
     which--
       (A) the ultra deep well is a sidetrack; or
       (B) the lease has previously produced from wells with a 
     perforated interval the top of which is at least 15,000 feet 
     true vertical depth below the datum at mean sea level.
       (3) Definitions.--In this subsection:
       (A) Ultra deep well.--The term ``ultra deep well'' means a 
     well drilled with a perforated interval, the top of which is 
     at least 20,000 true vertical depth below the datum at mean 
     sea level.
       (B) Sidetrack.--
       (i) In general.--The term ``sidetrack'' means a well 
     resulting from drilling an additional hole to a new objective 
     bottom-hole location by leaving a previously drilled hole.
       (ii) Inclusion.--The term ``sidetrack'' includes-

       (I) drilling a well from a platform slot reclaimed from a 
     previously drilled well;
       (II) re-entering and deepening a previously drilled well; 
     and
       (III) a bypass from a sidetrack, including drilling around 
     material blocking a hole or drilling to straighten a crooked 
     hole.

       (b) Royalty Incentive Regulations for Deep Gas Wells.--Not 
     later than 180 days after the date of enactment of this Act, 
     in addition to any other regulations that may provide royalty 
     incentives for natural gas produced from deep wells on oil 
     and gas leases issued pursuant to the Outer Continental Shelf 
     Lands Act (43 U.S.C. 1331 et seq.), the Secretary shall issue 
     regulations granting royalty relief suspension volumes with 
     respect to production of natural gas from deep wells on 
     leases issued in waters more than 200 meters but less than 
     400 meters deep located in the Gulf of Mexico wholly west of 
     87 degrees, 30 minutes west longitude. The suspension volumes 
     for deep wells within 200 to 400 meters of water depth shall 
     be calculated using the same methodology used to calculate 
     the suspension volumes for deep wells in the shallower waters 
     of the Gulf of Mexico, and in no case shall the suspension 
     volumes for deep wells within 200 to 400 meters of water 
     depth be lower than those for deep wells in shallower waters. 
     Regulations issued under this subsection shall be retroactive 
     to the date that the notice of proposed rulemaking is 
     published in the Federal Register.
       (c) Limitations.--The Secretary may place limitations on 
     the royalty relief granted under this section based on market 
     price. The royalty relief granted under this section shall 
     not apply to a lease for which deep water royalty relief is 
     available.

     SEC. 345. ROYALTY RELIEF FOR DEEP WATER PRODUCTION.

       (a) In General.--Subject to subsections (b) and (c), for 
     each tract located in water depths of greater than 400 meters 
     in the Western and Central Planning Area of the Gulf of 
     Mexico (including the portion of the Eastern Planning Area of 
     the Gulf of Mexico encompassing whole lease blocks lying west 
     of 87 degrees, 30 minutes West longitude), any oil or gas 
     lease sale under the Outer Continental Shelf Lands Act (43 
     U.S.C. 1331 et seq.) occurring during the 5-year period 
     beginning on the date of enactment of this Act shall use the 
     bidding system authorized under section 8(a)(1)(H) of the 
     Outer Continental Shelf Lands Act (43 U.S.C. 1337(a)(1)(H)).
       (b) Suspension of Royalties.--The suspension of royalties 
     under subsection (a) shall be established at a volume of not 
     less than--
       (1) 5,000,000 barrels of oil equivalent for each lease in 
     water depths of 400 to 800 meters;
       (2) 9,000,000 barrels of oil equivalent for each lease in 
     water depths of 800 to 1,600 meters;
       (3) 12,000,000 barrels of oil equivalent for each lease in 
     water depths of 1,600 to 2,000 meters; and

[[Page 17825]]

       (4) 16,000,000 barrels of oil equivalent for each lease in 
     water depths greater than 2,000 meters.
       (c) Limitation.--The Secretary may place limitations on 
     royalty relief granted under this section based on market 
     price.

     SEC. 346. ALASKA OFFSHORE ROYALTY SUSPENSION.

       Section 8(a)(3)(B) of the Outer Continental Shelf Lands Act 
     (43 U.S.C. 1337(a)(3)(B)) is amended by inserting ``and in 
     the Planning Areas offshore Alaska'' after ``West 
     longitude''.

     SEC. 347. OIL AND GAS LEASING IN THE NATIONAL PETROLEUM 
                   RESERVE IN ALASKA.

       (a) Transfer of Authority.--
       (1) Redesignation.--The Naval Petroleum Reserves Production 
     Act of 1976 (42 U.S.C. 6501 et seq.) is amended by 
     redesignating section 107 (42 U.S.C. 6507) as section 108.
       (2) Transfer.--The matter under the heading ``EXPLORATION 
     OF NATIONAL PETROLEUM RESERVE IN ALASKA'' under the heading 
     ``ENERGY AND MINERALS'' of title I of Public Law 96-514 (42 
     U.S.C. 6508) is--
       (A) transferred to the Naval Petroleum Reserves Production 
     Act of 1976 (42 U.S.C. 6501 et seq.);
       (B) redesignated as section 107 of that Act; and
       (C) moved so as to appear after section 106 of that Act (42 
     U.S.C. 6506).
       (b) Competitive Leasing.--Section 107 of the Naval 
     Petroleum Reserves Production Act of 1976 (as amended by 
     subsection (a)(2)) is amended--
       (1) by striking the heading and all that follows through 
     ``Provided, That (1) activities'' and inserting the 
     following:

     ``SEC. 107. COMPETITIVE LEASING OF OIL AND GAS.

       ``(a) In General.--The Secretary shall conduct an 
     expeditious program of competitive leasing of oil and gas in 
     the Reserve in accordance with this Act.
       ``(b) Mitigation of Adverse Effects.--Activities'';
       (2) by striking ``Alaska (the Reserve); (2) the'' and 
     inserting ``Alaska.
       ``(c) Land Use Planning; BLM Wilderness Study.--The'';
       (3) by striking ``Reserve; (3) the'' and inserting 
     ``Reserve.
       ``(d) First Lease Sale.--The;'';
       (4) by striking ``4332); (4) the'' and inserting ``4321 et 
     seq.).
       ``(e) Withdrawals.--The'';
       (5) by striking ``herein; (5) bidding'' and inserting 
     ``under this section.
       ``(f) Bidding Systems.--Bidding'';
       (6) by striking ``629); (6) lease'' and inserting ``629).
       ``(g) Geological Structures.--Lease'';
       (7) by striking ``structures; (7) the'' and inserting 
     ``structures.
       ``(h) Size of Lease Tracts.--The'';
       (8) by striking ``Secretary; (8)'' and all that follows 
     through ``Drilling, production,'' and inserting ``Secretary.
       ``(i) Terms.--
       ``(1) In general.--Each lease shall be issued for an 
     initial period of not more than 10 years, and shall be 
     extended for so long thereafter as oil or gas is produced 
     from the lease in paying quantities, oil or gas is capable of 
     being produced in paying quantities, or drilling or reworking 
     operations, as approved by the Secretary, are conducted on 
     the leased land.
       ``(2) Renewal of leases with discoveries.--At the end of 
     the primary term of a lease the Secretary shall renew for an 
     additional 10-year term a lease that does not meet the 
     requirements of paragraph (1) if the lessee submits to the 
     Secretary an application for renewal not later than 60 days 
     before the expiration of the primary lease and the lessee 
     certifies, and the Secretary agrees, that hydrocarbon 
     resources were discovered on one or more wells drilled on the 
     leased land in such quantities that a prudent operator would 
     hold the lease for potential future development.
       ``(3) Renewal of leases without discoveries.--At the end of 
     the primary term of a lease the Secretary shall renew for an 
     additional 10-year term a lease that does not meet the 
     requirements of paragraph (1) if the lessee submits to the 
     Secretary an application for renewal not later than 60 days 
     before the expiration of the primary lease and pays the 
     Secretary a renewal fee of $100 per acre of leased land, 
     and--
       ``(A) the lessee provides evidence, and the Secretary 
     agrees that, the lessee has diligently pursued exploration 
     that warrants continuation with the intent of continued 
     exploration or future potential development of the leased 
     land; or
       ``(B) all or part of the lease--
       ``(i) is part of a unit agreement covering a lease 
     described in subparagraph (A); and
       ``(ii) has not been previously contracted out of the unit.
       ``(4) Applicability.--This subsection applies to a lease 
     that is in effect on or after the date of enactment of the 
     Energy Policy Act of 2005.
       ``(5) Expiration for failure to produce.--Notwithstanding 
     any other provision of this Act, if no oil or gas is produced 
     from a lease within 30 years after the date of the issuance 
     of the lease the lease shall expire.
       ``(6) Termination.--No lease issued under this section 
     covering lands capable of producing oil or gas in paying 
     quantities shall expire because the lessee fails to produce 
     the same due to circumstances beyond the control of the 
     lessee.
       ``(j) Unit Agreements.--
       ``(1) In general.--For the purpose of conservation of the 
     natural resources of all or part of any oil or gas pool, 
     field, reservoir, or like area, lessees (including 
     representatives) of the pool, field, reservoir, or like area 
     may unite with each other, or jointly or separately with 
     others, in collectively adopting and operating under a unit 
     agreement for all or part of the pool, field, reservoir, or 
     like area (whether or not any other part of the oil or gas 
     pool, field, reservoir, or like area is already subject to 
     any cooperative or unit plan of development or operation), if 
     the Secretary determines the action to be necessary or 
     advisable in the public interest. In determining the public 
     interest, the Secretary should consider, among other things, 
     the extent to which the unit agreement will minimize the 
     impact to surface resources of the leases and will facilitate 
     consolidation of facilities.
       ``(2) Consultation.--In making a determination under 
     paragraph (1), the Secretary shall consult with and provide 
     opportunities for participation by the State of Alaska or a 
     Regional Corporation (as defined in section 3 of the Alaska 
     Native Claims Settlement Act (43 U.S.C. 1602)) with respect 
     to the creation or expansion of units that include acreage in 
     which the State of Alaska or the Regional Corporation has an 
     interest in the mineral estate.
       ``(3) Production allocation methodology.--(A) The Secretary 
     may use a production allocation methodology for each 
     participating area within a unit that includes solely Federal 
     land in the Reserve.
       ``(B) The Secretary shall use a production allocation 
     methodology for each participating area within a unit that 
     includes Federal land in the Reserve and non-Federal land 
     based on the characteristics of each specific oil or gas 
     pool, field, reservoir, or like area to take into account 
     reservoir heterogeneity and area variation in reservoir 
     producibility across diverse leasehold interests. The 
     implementation of the foregoing production allocation 
     methodology shall be controlled by agreement among the 
     affected lessors and lessees.
       ``(4) Benefit of operations.--Drilling, production,'';
       (9) by striking ``When separate'' and inserting the 
     following:
       ``(5) Pooling.--If separate'';
       (10) by inserting ``(in consultation with the owners of the 
     other land)'' after ``determined by the Secretary of the 
     Interior'';
       (11) by striking ``thereto; (10) to'' and all that follows 
     through ``the terms provided therein'' and inserting ``to the 
     agreement.
       ``(k) Exploration Incentives.--
       ``(1) In general.--
       ``(A) Waiver, suspension, or reduction.--To encourage the 
     greatest ultimate recovery of oil or gas or in the interest 
     of conservation, the Secretary may waive, suspend, or reduce 
     the rental fees or minimum royalty, or reduce the royalty on 
     an entire leasehold (including on any lease operated pursuant 
     to a unit agreement), whenever (after consultation with the 
     State of Alaska and the North Slope Borough of Alaska and the 
     concurrence of any Regional Corporation for leases that 
     include land that was made available for acquisition by the 
     Regional Corporation under the provisions of section 1431(o) 
     of the Alaska National Interest Lands Conservation Act (16 
     U.S.C. 3101 et seq.)) in the judgment of the Secretary it is 
     necessary to do so to promote development, or whenever in the 
     judgment of the Secretary the leases cannot be successfully 
     operated under the terms provided therein.
       ``(B) Applicability.--This paragraph applies to a lease 
     that is in effect on or after the date of enactment of the 
     Energy Policy Act of 2005.'';
       (12) by striking ``The Secretary is authorized to'' and 
     inserting the following:
       ``(2) Suspension of operations and production.--The 
     Secretary may'';
       (13) by striking ``In the event'' and inserting the 
     following:
       ``(3) Suspension of payments.--If'';
       (14) by striking ``thereto; and (11) all'' and inserting 
     ``to the lease.
       ``(l) Receipts.--All'';
       (15) by redesignating subparagraphs (A), (B), and (C) as 
     paragraphs (1), (2), and (3), respectively;
       (16) by striking ``Any agency'' and inserting the 
     following:
       ``(m) Explorations.--Any agency'';
       (17) by striking ``Any action'' and inserting the 
     following:
       ``(n) Environmental Impact Statements.--
       ``(1) Judicial review.--Any action'';
       (18) by striking ``The detailed'' and inserting the 
     following:
       ``(2) Initial lease sales.--The detailed'';
       (19) by striking ``section 104(b) of the Naval Petroleum 
     Reserves Production Act of 1976 (90 Stat. 304; 42 U.S.C. 
     6504)'' and inserting ``section 104(a)''; and
       (20) by adding at the end the following:
       ``(o) Regulations.--As soon as practicable after the date 
     of enactment of the Energy Policy Act of 2005, the Secretary 
     shall issue regulations to implement this section.
       ``(p) Waiver of Administration for Conveyed Lands.--
       ``(1) In general.--Notwithstanding section 14(g) of the 
     Alaska Native Claims Settlement Act (43 U.S.C. 1613(g))--
       ``(A) the Secretary of the Interior shall waive 
     administration of any oil and gas lease to the extent that 
     the lease covers any land in the Reserve in which all of the 
     subsurface estate is conveyed to the Arctic Slope Regional 
     Corporation (referred to in this subsection as the 
     `Corporation');
       ``(B)(i) in a case in which a conveyance of a subsurface 
     estate described in subparagraph (A) does not include all of 
     the land covered by the oil and gas lease, the person that 
     owns the subsurface estate in any particular portion of the

[[Page 17826]]

     land covered by the lease shall be entitled to all of the 
     revenues reserved under the lease as to that portion, 
     including, without limitation, all the royalty payable with 
     respect to oil or gas produced from or allocated to that 
     portion;
       ``(ii) in a case described in clause (i), the Secretary of 
     the Interior shall--

       ``(I) segregate the lease into 2 leases, 1 of which shall 
     cover only the subsurface estate conveyed to the Corporation; 
     and
       ``(II) waive administration of the lease that covers the 
     subsurface estate conveyed to the Corporation; and

       ``(iii) the segregation of the lease described in clause 
     (ii)(I) has no effect on the obligations of the lessee under 
     either of the resulting leases, including obligations 
     relating to operations, production, or other circumstances 
     (other than payment of rentals or royalties); and
       ``(C) nothing in this subsection limits the authority of 
     the Secretary of the Interior to manage the federally-owned 
     surface estate within the Reserve.''.
       (c) Conforming Amendments.--Section 104 of the Naval 
     Petroleum Reserves Production Act of 1976 (42 U.S.C. 6504) is 
     amended--
       (1) by striking subsection (a); and
       (2) by redesignating subsections (b) through (d) as 
     subsections (a) through (c), respectively.

     SEC. 348. NORTH SLOPE SCIENCE INITIATIVE.

       (a) Establishment.--
       (1) In general.--The Secretary of the Interior shall 
     establish a long-term initiative to be known as the ``North 
     Slope Science Initiative'' (referred to in this section as 
     the ``Initiative'').
       (2) Purpose.--The purpose of the Initiative shall be to 
     implement efforts to coordinate collection of scientific data 
     that will provide a better understanding of the terrestrial, 
     aquatic, and marine ecosystems of the North Slope of Alaska.
       (b) Objectives.--To ensure that the Initiative is conducted 
     through a comprehensive science strategy and implementation 
     plan, the Initiative shall, at a minimum--
       (1) identify and prioritize information needs for 
     inventory, monitoring, and research activities to address the 
     individual and cumulative effects of past, ongoing, and 
     anticipated development activities and environmental change 
     on the North Slope;
       (2) develop an understanding of information needs for 
     regulatory and land management agencies, local governments, 
     and the public;
       (3) focus on prioritization of pressing natural resource 
     management and ecosystem information needs, coordination, and 
     cooperation among agencies and organizations;
       (4) coordinate ongoing and future inventory, monitoring, 
     and research activities to minimize duplication of effort, 
     share financial resources and expertise, and assure the 
     collection of quality information;
       (5) identify priority needs not addressed by agency science 
     programs in effect on the date of enactment of this Act and 
     develop a funding strategy to meet those needs;
       (6) provide a consistent approach to high caliber science, 
     including inventory, monitoring, and research;
       (7) maintain and improve public and agency access to--
       (A) accumulated and ongoing research; and
       (B) contemporary and traditional local knowledge; and
       (8) ensure through appropriate peer review that the science 
     conducted by participating agencies and organizations is of 
     the highest technical quality.
       (c) Membership.--
       (1) In general.--To ensure comprehensive collection of 
     scientific data, in carrying out the Initiative, the 
     Secretary shall consult and coordinate with Federal, State, 
     and local agencies that have responsibilities for land and 
     resource management across the North Slope.
       (2) Cooperative agreements.--The Secretary shall enter into 
     cooperative agreements with the State of Alaska, the North 
     Slope Borough, the Arctic Slope Regional Corporation, and 
     other Federal agencies as appropriate to coordinate efforts, 
     share resources, and fund projects under this section.
       (d) Science Technical Advisory Panel.--
       (1) In general.--The Initiative shall include a panel to 
     provide advice on proposed inventory, monitoring, and 
     research functions.
       (2) Membership.--The panel described in paragraph (1) shall 
     consist of a representative group of not more than 15 
     scientists and technical experts from diverse professions and 
     interests, including the oil and gas industry, subsistence 
     users, Native Alaskan entities, conservation organizations, 
     wildlife management organizations, and academia, as 
     determined by the Secretary.
       (e) Reports.--Not later than 3 years after the date of 
     enactment of this section and each year thereafter, the 
     Secretary shall publish a report that describes the studies 
     and findings of the Initiative.
       (f) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section.

     SEC. 349. ORPHANED, ABANDONED, OR IDLED WELLS ON FEDERAL 
                   LAND.

       (a) In General.--The Secretary, in cooperation with the 
     Secretary of Agriculture, shall establish a program not later 
     than 1 year after the date of enactment of this Act to 
     remediate, reclaim, and close orphaned, abandoned, or idled 
     oil and gas wells located on land administered by the land 
     management agencies within the Department of the Interior and 
     the Department of Agriculture.
       (b) Activities.--The program under subsection (a) shall--
       (1) include a means of ranking orphaned, abandoned, or 
     idled wells sites for priority in remediation, reclamation, 
     and closure, based on public health and safety, potential 
     environmental harm, and other land use priorities;
       (2) provide for identification and recovery of the costs of 
     remediation, reclamation, and closure from persons or other 
     entities currently providing a bond or other financial 
     assurance required under State or Federal law for an oil or 
     gas well that is orphaned, abandoned, or idled; and
       (3) provide for recovery from the persons or entities 
     identified under paragraph (2), or their sureties or 
     guarantors, of the costs of remediation, reclamation, and 
     closure of such wells.
       (c) Cooperation and Consultations.--In carrying out the 
     program under subsection (a), the Secretary shall--
       (1) work cooperatively with the Secretary of Agriculture 
     and the States within which Federal land is located; and
       (2) consult with the Secretary of Energy and the Interstate 
     Oil and Gas Compact Commission.
       (d) Plan.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary, in cooperation with the 
     Secretary of Agriculture, shall submit to Congress a plan for 
     carrying out the program under subsection (a).
       (e) Idled Well.--For the purposes of this section, a well 
     is idled if--
       (1) the well has been nonoperational for at least 7 years; 
     and
       (2) there is no anticipated beneficial use for the well.
       (f) Federal Reimbursement for Orphaned Well Reclamation 
     Pilot Program.--
       (1) Reimbursement for remediating, reclaiming, and closing 
     wells on land subject to a new lease.--The Secretary shall 
     carry out a pilot program under which, in issuing a new oil 
     and gas lease on federally owned land on which 1 or more 
     orphaned wells are located, the Secretary--
       (A) may require, other than as a condition of the lease, 
     that the lessee remediate, reclaim, and close in accordance 
     with standards established by the Secretary, all orphaned 
     wells on the land leased; and
       (B) shall develop a program to reimburse a lessee, through 
     a royalty credit against the Federal share of royalties owed 
     or other means, for the reasonable actual costs of 
     remediating, reclaiming, and closing the orphaned wells 
     pursuant to that requirement.
       (2) Reimbursement for reclaiming orphaned wells on other 
     land.--In carrying out this subsection, the Secretary--
       (A) may authorize any lessee under an oil and gas lease on 
     federally owned land to reclaim in accordance with the 
     Secretary's standards--
       (i) an orphaned well on unleased federally owned land; or
       (ii) an orphaned well located on an existing lease on 
     federally owned land for the reclamation of which the lessee 
     is not legally responsible; and
       (B) shall develop a program to provide reimbursement of 100 
     percent of the reasonable actual costs of remediating, 
     reclaiming, and closing the orphaned well, through credits 
     against the Federal share of royalties or other means.
       (3) Regulations.--The Secretary may issue such regulations 
     as are appropriate to carry out this subsection.
       (g) Technical Assistance Program for Non-Federal Land.--
       (1) In general.--The Secretary of Energy shall establish a 
     program to provide technical and financial assistance to oil 
     and gas producing States to facilitate State efforts over a 
     10-year period to ensure a practical and economical remedy 
     for environmental problems caused by orphaned or abandoned 
     oil and gas exploration or production well sites on State or 
     private land.
       (2) Assistance.--The Secretary of Energy shall work with 
     the States, through the Interstate Oil and Gas Compact 
     Commission, to assist the States in quantifying and 
     mitigating environmental risks of onshore orphaned or 
     abandoned oil or gas wells on State and private land.
       (3) Activities.--The program under paragraph (1) shall 
     include--
       (A) mechanisms to facilitate identification, if feasible, 
     of the persons currently providing a bond or other form of 
     financial assurance required under State or Federal law for 
     an oil or gas well that is orphaned or abandoned;
       (B) criteria for ranking orphaned or abandoned well sites 
     based on factors such as public health and safety, potential 
     environmental harm, and other land use priorities;
       (C) information and training programs on best practices for 
     remediation of different types of sites; and
       (D) funding of State mitigation efforts on a cost-shared 
     basis.
       (h) Authorization of Appropriations.--
       (1) In general.--There are authorized to be appropriated to 
     carry out this section $25,000,000 for each of fiscal years 
     2006 through 2010.
       (2) Use.--Of the amounts authorized under paragraph (1), 
     $5,000,000 are authorized for each fiscal year for activities 
     under subsection (f).

     SEC. 350. COMBINED HYDROCARBON LEASING.

       (a) Special Provisions Regarding Leasing.--Section 17(b)(2) 
     of the Mineral Leasing Act (30 U.S.C. 226(b)(2)) is amended--
       (1) by inserting ``(A)'' after ``(2)''; and
       (2) by adding at the end the following:
       ``(B) For any area that contains any combination of tar 
     sand and oil or gas (or both), the Secretary may issue under 
     this Act, separately--

[[Page 17827]]

       ``(i) a lease for exploration for and extraction of tar 
     sand; and
       ``(ii) a lease for exploration for and development of oil 
     and gas.
       ``(C) A lease issued for tar sand shall be issued using the 
     same bidding process, annual rental, and posting period as a 
     lease issued for oil and gas, except that the minimum 
     acceptable bid required for a lease issued for tar sand shall 
     be $2 per acre.
       ``(D) The Secretary may waive, suspend, or alter any 
     requirement under section 26 that a permittee under a permit 
     authorizing prospecting for tar sand must exercise due 
     diligence, to promote any resource covered by a combined 
     hydrocarbon lease.''.
       (b) Conforming Amendment.--Section 17(b)(1)(B) of the 
     Mineral Leasing Act (30 U.S.C. 226(b)(1)(B)) is amended in 
     the second sentence by inserting ``, subject to paragraph 
     (2)(B),'' after ``Secretary''.
       (c) Regulations.--Not later than 45 days after the date of 
     enactment of this Act, the Secretary shall issue final 
     regulations to implement this section.

     SEC. 351. PRESERVATION OF GEOLOGICAL AND GEOPHYSICAL DATA.

       (a) Short Title.--This section may be cited as the 
     ``National Geological and Geophysical Data Preservation 
     Program Act of 2005''.
       (b) Program.--The Secretary shall carry out a National 
     Geological and Geophysical Data Preservation Program in 
     accordance with this section--
       (1) to archive geologic, geophysical, and engineering data, 
     maps, well logs, and samples;
       (2) to provide a national catalog of such archival 
     material; and
       (3) to provide technical and financial assistance related 
     to the archival material.
       (c) Plan.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     a plan for the implementation of the Program.
       (d) Data Archive System.--
       (1) Establishment.--The Secretary shall establish, as a 
     component of the Program, a data archive system to provide 
     for the storage, preservation, and archiving of subsurface, 
     surface, geological, geophysical, and engineering data and 
     samples. The Secretary, in consultation with the Advisory 
     Committee, shall develop guidelines relating to the data 
     archive system, including the types of data and samples to be 
     preserved.
       (2) System components.--The system shall be comprised of 
     State agencies that elect to be part of the system and 
     agencies within the Department of the Interior that maintain 
     geological and geophysical data and samples that are 
     designated by the Secretary in accordance with this 
     subsection. The Program shall provide for the storage of data 
     and samples through data repositories operated by such 
     agencies.
       (3) Limitation of designation.--The Secretary may not 
     designate a State agency as a component of the data archive 
     system unless that agency is the agency that acts as the 
     geological survey in the State.
       (4) Data from federal land.--The data archive system shall 
     provide for the archiving of relevant subsurface data and 
     samples obtained from Federal land--
       (A) in the most appropriate repository designated under 
     paragraph (2), with preference being given to archiving data 
     in the State in which the data were collected; and
       (B) consistent with all applicable law and requirements 
     relating to confidentiality and proprietary data.
       (e) National Catalog.--
       (1) In general.--As soon as practicable after the date of 
     enactment of this Act, the Secretary shall develop and 
     maintain, as a component of the Program, a national catalog 
     that identifies--
       (A) data and samples available in the data archive system 
     established under subsection (d);
       (B) the repository for particular material in the system; 
     and
       (C) the means of accessing the material.
       (2) Availability.--The Secretary shall make the national 
     catalog accessible to the public on the site of the Survey on 
     the Internet, consistent with all applicable requirements 
     related to confidentiality and proprietary data.
       (f) Advisory Committee.--
       (1) In general.--The Advisory Committee shall advise the 
     Secretary on planning and implementation of the Program.
       (2) New duties.--In addition to its duties under the 
     National Geologic Mapping Act of 1992 (43 U.S.C. 31a et 
     seq.), the Advisory Committee shall perform the following 
     duties:
       (A) Advise the Secretary on developing guidelines and 
     procedures for providing assistance for facilities under 
     subsection (g)(1).
       (B) Review and critique the draft implementation plan 
     prepared by the Secretary under subsection (c).
       (C) Identify useful studies of data archived under the 
     Program that will advance understanding of the Nation's 
     energy and mineral resources, geologic hazards, and 
     engineering geology.
       (D) Review the progress of the Program in archiving 
     significant data and preventing the loss of such data, and 
     the scientific progress of the studies funded under the 
     Program.
       (E) Include in the annual report to the Secretary required 
     under section 5(b)(3) of the National Geologic Mapping Act of 
     1992 (43 U.S.C. 31d(b)(3)) an evaluation of the progress of 
     the Program toward fulfilling the purposes of the Program 
     under subsection (b).
       (g) Financial Assistance.--
       (1) Archive facilities.--Subject to the availability of 
     appropriations, the Secretary shall provide financial 
     assistance to a State agency that is designated under 
     subsection (d)(2) for providing facilities to archive energy 
     material.
       (2) Studies.--Subject to the availability of 
     appropriations, the Secretary shall provide financial 
     assistance to any State agency designated under subsection 
     (d)(2) for studies and technical assistance activities that 
     enhance understanding, interpretation, and use of materials 
     archived in the data archive system established under 
     subsection (d).
       (3) Federal share.--The Federal share of the cost of an 
     activity carried out with assistance under this subsection 
     shall be not more than 50 percent of the total cost of the 
     activity.
       (4) Private contributions.--The Secretary shall apply to 
     the non-Federal share of the cost of an activity carried out 
     with assistance under this subsection the value of private 
     contributions of property and services used for that 
     activity.
       (h) Report.--The Secretary shall include in each report 
     under section 8 of the National Geologic Mapping Act of 1992 
     (43 U.S.C. 31g)--
       (1) a description of the status of the Program;
       (2) an evaluation of the progress achieved in developing 
     the Program during the period covered by the report; and
       (3) any recommendations for legislative or other action the 
     Secretary considers necessary and appropriate to fulfill the 
     purposes of the Program under subsection (b).
       (i) Maintenance of State Effort.--It is the intent of 
     Congress that the States not use this section as an 
     opportunity to reduce State resources applied to the 
     activities that are the subject of the Program.
       (j) Definitions.--In this section:
       (1) Advisory committee.--The term ``Advisory Committee'' 
     means the advisory committee established under section 5 of 
     the National Geologic Mapping Act of 1992 (43 U.S.C. 31d).
       (2) Program.--The term ``Program'' means the National 
     Geological and Geophysical Data Preservation Program carried 
     out under this section.
       (3) Secretary.--The term ``Secretary'' means the Secretary 
     of the Interior, acting through the Director of the United 
     States Geological Survey.
       (4) Survey.--The term ``Survey'' means the United States 
     Geological Survey.
       (k) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section $30,000,000 for 
     each of fiscal years 2006 through 2010.

     SEC. 352. OIL AND GAS LEASE ACREAGE LIMITATIONS.

       Section 27(d)(1) of the Mineral Leasing Act (30 U.S.C. 
     184(d)(1)) is amended by inserting after ``acreage held in 
     special tar sand areas'' the following: ``, and acreage under 
     any lease any portion of which has been committed to a 
     federally approved unit or cooperative plan or 
     communitization agreement or for which royalty (including 
     compensatory royalty or royalty in-kind) was paid in the 
     preceding calendar year,''.

     SEC. 353. GAS HYDRATE PRODUCTION INCENTIVE.

       (a) Purpose.--The purpose of this section is to promote 
     natural gas production from the natural gas hydrate resources 
     on the outer Continental Shelf and Federal lands in Alaska by 
     providing royalty incentives.
       (b) Suspension of Royalties.--
       (1) In general.--The Secretary may grant royalty relief in 
     accordance with this section for natural gas produced from 
     gas hydrate resources under an eligible lease.
       (2) Eligible leases.--A lease shall be an eligible lease 
     for purposes of this section if--
       (A) it is issued under the Outer Continental Shelf Lands 
     Act (43 U.S.C. 1331 et seq.), or is an oil and gas lease 
     issued for onshore Federal lands in Alaska;
       (B) it is issued prior to January 1, 2016; and
       (C) production under the lease of natural gas from gas 
     hydrate resources commences prior to January 1, 2018.
       (3) Amount of relief.--The Secretary shall conduct a 
     rulemaking and grant royalty relief under this section as a 
     suspension volume if the Secretary determines that such 
     royalty relief would encourage production of natural gas from 
     gas hydrate resources from an eligible lease. The maximum 
     suspension volume shall be 30 billion cubic feet of natural 
     gas per lease. Such relief shall be in addition to any other 
     royalty relief under any other provision applicable to the 
     lease that does not specifically grant a gas hydrate 
     production incentive. Such royalty suspension volume shall be 
     applied to any eligible production occurring on or after the 
     date of publication of the advanced notice of proposed 
     rulemaking.
       (4) Limitation.--The Secretary may place limitations on 
     royalty relief granted under this section based on market 
     price.
       (c) Application.--This section shall apply to any eligible 
     lease issued before, on, or after the date of enactment of 
     this Act.
       (d) Rulemakings.--
       (1) Requirement.--The Secretary shall publish the advanced 
     notice of proposed rulemaking within 180 days after the date 
     of enactment of this Act and complete the rulemaking 
     implementing this section within 365 days after the date of 
     enactment of this Act.
       (2) Gas hydrate resources defined.--Such regulations shall 
     define the term ``gas hydrate resources'' to include both the 
     natural gas content of gas hydrates within the hydrate 
     stability zone and free natural gas trapped by and beneath 
     the hydrate stability zone.
       (e) Review.--Not later than 365 days after the date of 
     enactment of this Act, the Secretary, in consultation with 
     the Secretary of Energy, shall

[[Page 17828]]

     carry out a review of, and submit to Congress a report on, 
     further opportunities to enhance production of natural gas 
     from gas hydrate resources on the outer Continental Shelf and 
     on Federal lands in Alaska through the provision of other 
     production incentives or through technical or financial 
     assistance.

     SEC. 354. ENHANCED OIL AND NATURAL GAS PRODUCTION THROUGH 
                   CARBON DIOXIDE INJECTION.

       (a) Production Incentive.--
       (1) Findings.--Congress finds the following:
       (A) Approximately two-thirds of the original oil in place 
     in the United States remains unproduced.
       (B) Enhanced oil and natural gas production from the 
     sequestering of carbon dioxide and other appropriate gases 
     has the potential to increase oil and natural gas production.
       (C) Capturing and productively using carbon dioxide would 
     help reduce the carbon intensity of the economy.
       (2) Purpose.--The purpose of this section is--
       (A) to promote the capturing, transportation, and injection 
     of produced carbon dioxide, natural carbon dioxide, and other 
     appropriate gases or other matter for sequestration into oil 
     and gas fields; and
       (B) to promote oil and natural gas production from the 
     outer Continental Shelf and onshore Federal lands under lease 
     by providing royalty incentives to use enhanced recovery 
     techniques using injection of the substances referred to in 
     subparagraph (A).
       (b) Suspension of Royalties.--
       (1) In general.--If the Secretary determines that reduction 
     of the royalty under a Federal oil and gas lease that is an 
     eligible lease is in the public interest and promotes the 
     purposes of this section, the Secretary shall undertake a 
     rulemaking to provide for such reduction for an eligible 
     lease.
       (2) Rulemakings.--The Secretary shall publish the advanced 
     notice of proposed rulemaking within 180 days after the date 
     of enactment of this Act and complete the rulemaking 
     implementing this section within 365 days after the date of 
     enactment of this Act.
       (3) Eligible leases.--A lease shall be an eligible lease 
     for purposes of this section if--
       (A) it is a lease for production of oil and gas from the 
     outer Continental Shelf or Federal onshore lands;
       (B) the injection of the substances referred to in 
     subsection (a)(2)(A) will be used as an enhanced recovery 
     technique on such lease; and
       (C) the Secretary determines that the lease contains oil or 
     gas that would not likely be produced without the royalty 
     reduction provided under this section.
       (4) Amount of relief.--The rulemaking shall provide for a 
     suspension volume, which shall not exceed 5,000,000 barrels 
     of oil equivalent for each eligible lease. Such suspension 
     volume shall be applied to any production from an eligible 
     lease occurring on or after the date of publication of any 
     advanced notice of proposed rulemaking under this subsection.
       (5) Limitation.--The Secretary may place limitations on the 
     royalty reduction granted under this section based on market 
     price.
       (6) Application.--This section shall apply to any eligible 
     lease issued before, on, or after the date of enactment of 
     this Act.
       (c) Demonstration Program.--
       (1) Establishment.--
       (A) In general.--The Secretary of Energy shall establish a 
     competitive grant program to provide grants to producers of 
     oil and gas to carry out projects to inject carbon dioxide 
     for the purpose of enhancing recovery of oil or natural gas 
     while increasing the sequestration of carbon dioxide.
       (B) Projects.--The demonstration program shall provide 
     for--
       (i) not more than 10 projects in the Willistin Basin in 
     North Dakota and Montana; and
       (ii) 1 project in the Cook Inlet Basin in Alaska.
       (2) Requirements.--
       (A) In general.--The Secretary of Energy shall issue 
     requirements relating to applications for grants under 
     paragraph (1).
       (B) Rulemaking.--The issuance of requirements under 
     subparagraph (A) shall not require a rulemaking.
       (C) Minimum requirements.--At a minimum, the Secretary 
     shall require under subparagraph (A) that an application for 
     a grant include--
       (i) a description of the project proposed in the 
     application;
       (ii) an estimate of the production increase and the 
     duration of the production increase from the project, as 
     compared to conventional recovery techniques, including water 
     flooding;
       (iii) an estimate of the carbon dioxide sequestered by 
     project, over the life of the project;
       (iv) a plan to collect and disseminate data relating to 
     each project to be funded by the grant;
       (v) a description of the means by which the project will be 
     sustainable without Federal assistance after the completion 
     of the term of the grant;
       (vi) a complete description of the costs of the project, 
     including acquisition, construction, operation, and 
     maintenance costs over the expected life of the project;
       (vii) a description of which costs of the project will be 
     supported by Federal assistance under this section; and
       (viii) a description of any secondary or tertiary recovery 
     efforts in the field and the efficacy of water flood recovery 
     techniques used.
       (3) Partners.--An applicant for a grant under paragraph (1) 
     may carry out a project under a pilot program in partnership 
     with 1 or more other public or private entities.
       (4) Selection criteria.--In evaluating applications under 
     this subsection, the Secretary of Energy shall--
       (A) consider the previous experience with similar projects 
     of each applicant; and
       (B) give priority consideration to applications that--
       (i) are most likely to maximize production of oil and gas 
     in a cost-effective manner;
       (ii) sequester significant quantities of carbon dioxide 
     from anthropogenic sources;
       (iii) demonstrate the greatest commitment on the part of 
     the applicant to ensure funding for the proposed project and 
     the greatest likelihood that the project will be maintained 
     or expanded after Federal assistance under this section is 
     completed; and
       (iv) minimize any adverse environmental effects from the 
     project.
       (5) Demonstration program requirements.--
       (A) Maximum amount.--The Secretary of Energy shall not 
     provide more than $3,000,000 in Federal assistance under this 
     subsection to any applicant.
       (B) Cost sharing.--The Secretary of Energy shall require 
     cost-sharing under this subsection in accordance with section 
     988.
       (C) Period of grants.--
       (i) In general.--A project funded by a grant under this 
     subsection shall begin construction not later than 2 years 
     after the date of provision of the grant, but in any case not 
     later than December 31, 2010.
       (ii) Term.--The Secretary shall not provide grant funds to 
     any applicant under this subsection for a period of more than 
     5 years.
       (6) Transfer of information and knowledge.--The Secretary 
     of Energy shall establish mechanisms to ensure that the 
     information and knowledge gained by participants in the 
     program under this subsection are transferred among other 
     participants and interested persons, including other 
     applicants that submitted applications for a grant under this 
     subsection.
       (7) Schedule.--
       (A) Publication.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary of Energy shall publish 
     in the Federal Register, and elsewhere, as appropriate, a 
     request for applications to carry out projects under this 
     subsection.
       (B) Date for applications.--An application for a grant 
     under this subsection shall be submitted not later than 180 
     days after the date of publication of the request under 
     subparagraph (A).
       (C) Selection.--After the date by which applications for 
     grants are required to be submitted under subparagraph (B), 
     the Secretary of Energy, in a timely manner, shall select, 
     after peer review and based on the criteria under paragraph 
     (4), those projects to be awarded a grant under this 
     subsection.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section.

     SEC. 355. ASSESSMENT OF DEPENDENCE OF STATE OF HAWAII ON OIL.

       (a) Assessment.--The Secretary of Energy shall assess the 
     economic implications of the dependence of the State of 
     Hawaii on oil as the principal source of energy for the 
     State, including--
       (1) the short- and long-term prospects for crude oil supply 
     disruption and price volatility and potential impacts on the 
     economy of Hawaii;
       (2) the economic relationship between oil-fired generation 
     of electricity from residual fuel and refined petroleum 
     products consumed for ground, marine, and air transportation;
       (3) the technical and economic feasibility of increasing 
     the contribution of renewable energy resources for generation 
     of electricity, on an island-by-island basis, including--
       (A) siting and facility configuration;
       (B) environmental, operational, and safety considerations;
       (C) the availability of technology;
       (D) the effects on the utility system, including 
     reliability;
       (E) infrastructure and transport requirements;
       (F) community support; and
       (G) other factors affecting the economic impact of such an 
     increase and any effect on the economic relationship 
     described in paragraph (2);
       (4) the technical and economic feasibility of using 
     liquefied natural gas to displace residual fuel oil for 
     electric generation, including neighbor island opportunities, 
     and the effect of the displacement on the economic 
     relationship described in paragraph (2), including--
       (A) the availability of supply;
       (B) siting and facility configuration for onshore and 
     offshore liquefied natural gas receiving terminals;
       (C) the factors described in subparagraphs (B) through (F) 
     of paragraph (3); and
       (D) other economic factors;
       (5) the technical and economic feasibility of using 
     renewable energy sources (including hydrogen) for ground, 
     marine, and air transportation energy applications to 
     displace the use of refined petroleum products, on an island-
     by-island basis, and the economic impact of the displacement 
     on the relationship described in paragraph (2); and
       (6) an island-by-island approach to--
       (A) the development of hydrogen from renewable resources; 
     and
       (B) the application of hydrogen to the energy needs of 
     Hawaii
       (b) Contracting Authority.--The Secretary of Energy may 
     carry out the assessment under

[[Page 17829]]

     subsection (a) directly or, in whole or in part, through 1 or 
     more contracts with qualified public or private entities.
       (c) Report.--Not later than 300 days after the date of 
     enactment of this Act, the Secretary of Energy shall prepare 
     (in consultation with agencies of the State of Hawaii and 
     other stakeholders, as appropriate), and submit to Congress, 
     a report describing the findings, conclusions, and 
     recommendations resulting from the assessment.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section.

     SEC. 356. DENALI COMMISSION.

       (a) Definition of Commission.--In this section, the term 
     ``Commission'' means the Denali Commission established by the 
     Denali Commission Act of 1998 (42 U.S.C. 3121 note; Public 
     Law 105-277).
       (b) Energy Programs.--The Commission shall use amounts made 
     available under subsection (d) to carry out energy programs, 
     including--
       (1) energy generation and development, including--
       (A) fuel cells, hydroelectric, solar, wind, wave, and tidal 
     energy; and
       (B) alternative energy sources;
       (2) the construction of energy transmission, including 
     interties;
       (3) the replacement and cleanup of fuel tanks;
       (4) the construction of fuel transportation networks and 
     related facilities;
       (5) power cost equalization programs; and
       (6) projects using coal as a fuel, including coal 
     gasification projects.
       (c) Open Meetings.--
       (1) In general.--Except as provided in paragraph (2), a 
     meeting of the Commission shall be open to the public if--
       (A) the Commission members take action on behalf of the 
     Commission; or
       (B) the deliberations of the Commission determine, or 
     result in the joint conduct or disposition of, official 
     Commission business.
       (2) Exceptions.--Paragraph (1) shall not apply to any 
     portion of a Commission meeting for which the Commission, in 
     public session, votes to close the meeting for the reasons 
     described in paragraph (2), (4), (5), or (6) of subsection 
     (c) of section 552b of title 5, United States Code.
       (3) Public notice.--
       (A) In general.--At least 1 week before a meeting of the 
     Commission, the Commission shall make a public announcement 
     of the meeting that describes--
       (i) the time, place, and subject matter of the meeting;
       (ii) whether the meeting is to be open or closed to the 
     public; and
       (iii) the name and telephone number of an appropriate 
     person to respond to requests for information about the 
     meeting.
       (B) Additional notice.--The Commission shall make a public 
     announcement of any change to the information made available 
     under subparagraph (A) at the earliest practicable time.
       (4) Minutes.--The Commission shall keep, and make available 
     to the public, a transcript, electronic recording, or minutes 
     from each Commission meeting, except for portions of the 
     meeting closed under paragraph (2).
       (d) Authorization of Appropriations.--There is authorized 
     to be appropriated to the Commission not more than 
     $55,000,000 for each of fiscal years 2006 through 2015 to 
     carry out subsection (b).

     SEC. 357. COMPREHENSIVE INVENTORY OF OCS OIL AND NATURAL GAS 
                   RESOURCES.

       (a) In General.--The Secretary shall conduct an inventory 
     and analysis of oil and natural gas resources beneath all of 
     the waters of the United States Outer Continental Shelf 
     (``OCS''). The inventory and analysis shall--
       (1) use available data on oil and gas resources in areas 
     offshore of Mexico and Canada that will provide information 
     on trends of oil and gas accumulation in areas of the OCS;
       (2) use any available technology, except drilling, but 
     including 3-D seismic technology to obtain accurate resource 
     estimates;
       (3) analyze how resource estimates in OCS areas have 
     changed over time in regards to gathering geological and 
     geophysical data, initial exploration, or full field 
     development, including areas such as the deepwater and 
     subsalt areas in the Gulf of Mexico;
       (4) estimate the effect that understated oil and gas 
     resource inventories have on domestic energy investments; and
       (5) identify and explain how legislative, regulatory, and 
     administrative programs or processes restrict or impede the 
     development of identified resources and the extent that they 
     affect domestic supply, such as moratoria, lease terms and 
     conditions, operational stipulations and requirements, 
     approval delays by the Federal Government and coastal States, 
     and local zoning restrictions for onshore processing 
     facilities and pipeline landings.
       (b) Reports.--The Secretary shall submit a report to 
     Congress on the inventory of estimates and the analysis of 
     restrictions or impediments, together with any 
     recommendations, within 6 months of the date of enactment of 
     the section. The report shall be publicly available and 
     updated at least every 5 years.
                  Subtitle F--Access to Federal Lands

     SEC. 361. FEDERAL ONSHORE OIL AND GAS LEASING AND PERMITTING 
                   PRACTICES.

       (a) Review of Onshore Oil and Gas Leasing Practices.--
       (1) In general.--The Secretary of the Interior, in 
     consultation with the Secretary of Agriculture with respect 
     to National Forest System lands under the jurisdiction of the 
     Department of Agriculture, shall perform an internal review 
     of current Federal onshore oil and gas leasing and permitting 
     practices.
       (2) Inclusions.--The review shall include the process for--
       (A) accepting or rejecting offers to lease;
       (B) administrative appeals of decisions or orders of 
     officers or employees of the Bureau of Land Management with 
     respect to a Federal oil or gas lease;
       (C) considering surface use plans of operation, including 
     the timeframes in which the plans are considered, and any 
     recommendations for improving and expediting the process; and
       (D) identifying stipulations to address site-specific 
     concerns and conditions, including those stipulations 
     relating to the environment and resource use conflicts.
       (b) Report.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary of the Interior and the 
     Secretary of Agriculture shall transmit a report to Congress 
     that describes--
       (1) actions taken under section 3 of Executive Order No. 
     13212 (42 U.S.C. 13201 note); and
       (2) actions taken or any plans to improve the Federal 
     onshore oil and gas leasing program.

     SEC. 362. MANAGEMENT OF FEDERAL OIL AND GAS LEASING PROGRAMS.

       (a) Timely Action on Leases and Permits.--
       (1) Secretary of the interior.--To ensure timely action on 
     oil and gas leases and applications for permits to drill on 
     land otherwise available for leasing, the Secretary of the 
     Interior (referred to in this section as the ``Secretary'') 
     shall--
       (A) ensure expeditious compliance with section 102(2)(C) of 
     the National Environmental Policy Act of 1969 (42 U.S.C. 
     4332(2)(C)) and any other applicable environmental and 
     cultural resources laws;
       (B) improve consultation and coordination with the States 
     and the public; and
       (C) improve the collection, storage, and retrieval of 
     information relating to the oil and gas leasing activities.
       (2) Secretary of agriculture.--To ensure timely action on 
     oil and gas lease applications for permits to drill on land 
     otherwise available for leasing, the Secretary of Agriculture 
     shall--
       (A) ensure expeditious compliance with all applicable 
     environmental and cultural resources laws; and
       (B) improve the collection, storage, and retrieval of 
     information relating to the oil and gas leasing activities.
       (b) Best Management Practices.--
       (1) In general.--Not later than 18 months after the date of 
     enactment of this Act, the Secretary shall develop and 
     implement best management practices to--
       (A) improve the administration of the onshore oil and gas 
     leasing program under the Mineral Leasing Act (30 U.S.C. 181 
     et seq.); and
       (B) ensure timely action on oil and gas leases and 
     applications for permits to drill on land otherwise available 
     for leasing.
       (2) Considerations.--In developing the best management 
     practices under paragraph (1), the Secretary shall consider 
     any recommendations from the review under section 361.
       (3) Regulations.--Not later than 180 days after the 
     development of the best management practices under paragraph 
     (1), the Secretary shall publish, for public comment, 
     proposed regulations that set forth specific timeframes for 
     processing leases and applications in accordance with the 
     best management practices, including deadlines for--
       (A) approving or disapproving--
       (i) resource management plans and related documents;
       (ii) lease applications;
       (iii) applications for permits to drill; and
       (iv) surface use plans; and
       (B) related administrative appeals.
       (c) Improved Enforcement.--The Secretary and the Secretary 
     Agriculture shall improve inspection and enforcement of oil 
     and gas activities, including enforcement of terms and 
     conditions in permits to drill on land under the jurisdiction 
     of the Secretary and the Secretary of Agriculture, 
     respectively.
       (d) Authorization of Appropriations.--In addition to 
     amounts made available to carry out activities relating to 
     oil and gas leasing on public land administered by the 
     Secretary and National Forest System land administered by the 
     Secretary of Agriculture, there are authorized to be 
     appropriated for each of fiscal years 2006 through 2010--
       (1) to the Secretary, acting through the Director of the 
     Bureau of Land Management--
       (A) $40,000,000 to carry out subsections (a)(1) and (b); 
     and
       (B) $20,000,000 to carry out subsection (c);
       (2) to the Secretary, acting through the Director of the 
     United States Fish and Wildlife Service, $5,000,000 to carry 
     out subsection (a)(1); and
       (3) to the Secretary of Agriculture, acting through the 
     Chief of the Forest Service, $5,000,000 to carry out 
     subsections (a)(2) and (c).

     SEC. 363. CONSULTATION REGARDING OIL AND GAS LEASING ON 
                   PUBLIC LAND.

       (a) In General.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary of the Interior and the 
     Secretary of Agriculture shall enter into a memorandum of 
     understanding regarding oil and gas leasing on--
       (1) public land under the jurisdiction of the Secretary of 
     the Interior; and
       (2) National Forest System land under the jurisdiction of 
     the Secretary of Agriculture.

[[Page 17830]]

       (b) Contents.--The memorandum of understanding shall 
     include provisions that--
       (1) establish administrative procedures and lines of 
     authority that ensure timely processing of--
       (A) oil and gas lease applications;
       (B) surface use plans of operation, including steps for 
     processing surface use plans; and
       (C) applications for permits to drill consistent with 
     applicable timelines;
       (2) eliminate duplication of effort by providing for 
     coordination of planning and environmental compliance 
     efforts;
       (3) ensure that lease stipulations are--
       (A) applied consistently;
       (B) coordinated between agencies; and
       (C) only as restrictive as necessary to protect the 
     resource for which the stipulations are applied;
       (4) establish a joint data retrieval system that is capable 
     of--
       (A) tracking applications and formal requests made in 
     accordance with procedures of the Federal onshore oil and gas 
     leasing program; and
       (B) providing information regarding the status of the 
     applications and requests within the Department of the 
     Interior and the Department of Agriculture; and
       (5) establish a joint geographic information system mapping 
     system for use in--
       (A) tracking surface resource values to aid in resource 
     management; and
       (B) processing surface use plans of operation and 
     applications for permits to drill.

     SEC. 364. ESTIMATES OF OIL AND GAS RESOURCES UNDERLYING 
                   ONSHORE FEDERAL LAND.

       (a) Assessment.--Section 604 of the Energy Act of 2000 (42 
     U.S.C. 6217) is amended--
       (1) in subsection (a)--
       (A) in paragraph (1)--
       (i) by striking ``reserve''; and
       (ii) by striking ``and'' after the semicolon; and
       (B) by striking paragraph (2) and inserting the following:
       ``(2) the extent and nature of any restrictions or 
     impediments to the development of the resources, including--
       ``(A) impediments to the timely granting of leases;
       ``(B) post-lease restrictions, impediments, or delays on 
     development for conditions of approval, applications for 
     permits to drill, or processing of environmental permits; and
       ``(C) permits or restrictions associated with transporting 
     the resources for entry into commerce; and
       ``(3) the quantity of resources not produced or introduced 
     into commerce because of the restrictions.'';
       (2) in subsection (b)--
       (A) by striking ``reserve'' and inserting ``resource''; and
       (B) by striking ``publically'' and inserting ``publicly''; 
     and
       (3) by striking subsection (d) and inserting the following:
       ``(d) Assessments.--Using the inventory, the Secretary of 
     Energy shall make periodic assessments of economically 
     recoverable resources accounting for a range of parameters 
     such as current costs, commodity prices, technology, and 
     regulations.''.
       (b) Methodology.--The Secretary of the Interior shall use 
     the same assessment methodology across all geological 
     provinces, areas, and regions in preparing and issuing 
     national geological assessments to ensure accurate 
     comparisons of geological resources.

     SEC. 365. PILOT PROJECT TO IMPROVE FEDERAL PERMIT 
                   COORDINATION.

       (a) Establishment.--The Secretary of the Interior (referred 
     to in this section as the ``Secretary'') shall establish a 
     Federal Permit Streamlining Pilot Project (referred to in 
     this section as the ``Pilot Project'').
       (b) Memorandum of Understanding.--
       (1) In general.--Not later than 90 days after the date of 
     enactment of this Act, the Secretary shall enter into a 
     memorandum of understanding for purposes of this section 
     with--
       (A) the Secretary of Agriculture;
       (B) the Administrator of the Environmental Protection 
     Agency; and
       (C) the Chief of Engineers.
       (2) State participation.--The Secretary may request that 
     the Governors of Wyoming, Montana, Colorado, Utah, and New 
     Mexico be signatories to the memorandum of understanding.
       (c) Designation of Qualified Staff.--
       (1) In general.--Not later than 30 days after the date of 
     the signing of the memorandum of understanding under 
     subsection (b), all Federal signatory parties shall, if 
     appropriate, assign to each of the field offices identified 
     in subsection (d) an employee who has expertise in the 
     regulatory issues relating to the office in which the 
     employee is employed, including, as applicable, particular 
     expertise in--
       (A) the consultations and the preparation of biological 
     opinions under section 7 of the Endangered Species Act of 
     1973 (16 U.S.C. 1536);
       (B) permits under section 404 of Federal Water Pollution 
     Control Act (33 U.S.C. 1344);
       (C) regulatory matters under the Clean Air Act (42 U.S.C. 
     7401 et seq.);
       (D) planning under the National Forest Management Act of 
     1976 (16 U.S.C. 472a et seq.); and
       (E) the preparation of analyses under the National 
     Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.).
       (2) Duties.--Each employee assigned under paragraph (1) 
     shall--
       (A) not later than 90 days after the date of assignment, 
     report to the Bureau of Land Management Field Managers in the 
     office to which the employee is assigned;
       (B) be responsible for all issues relating to the 
     jurisdiction of the home office or agency of the employee; 
     and
       (C) participate as part of the team of personnel working on 
     proposed energy projects, planning, and environmental 
     analyses.
       (d) Field Offices.--The following Bureau of Land Management 
     Field Offices shall serve as the Pilot Project offices:
       (1) Rawlins, Wyoming.
       (2) Buffalo, Wyoming.
       (3) Miles City, Montana
       (4) Farmington, New Mexico.
       (5) Carlsbad, New Mexico.
       (6) Grand Junction/Glenwood Springs, Colorado.
       (7) Vernal, Utah.
       (e) Reports.--Not later than 3 years after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     a report that--
       (1) outlines the results of the Pilot Project to date; and
       (2) makes a recommendation to the President regarding 
     whether the Pilot Project should be implemented throughout 
     the United States.
       (f) Additional Personnel.--The Secretary shall assign to 
     each field office identified in subsection (d) any additional 
     personnel that are necessary to ensure the effective 
     implementation of--
       (1) the Pilot Project; and
       (2) other programs administered by the field offices, 
     including inspection and enforcement relating to energy 
     development on Federal land, in accordance with the multiple 
     use mandate of the Federal Land Policy and Management Act of 
     1976 (43 U.S.C. 1701 et seq).
       (g) Permit Processing Improvement Fund.--Section 35 of the 
     Mineral Leasing Act (30 U.S.C. 191) is amended by adding at 
     the end the following:
       ``(c)(1) Notwithstanding the first sentence of subsection 
     (a), any rentals received from leases in any State (other 
     than the State of Alaska) on or after the date of enactment 
     of this subsection shall be deposited in the Treasury, to be 
     allocated in accordance with paragraph (2).
       ``(2) Of the amounts deposited in the Treasury under 
     paragraph (1)--
       ``(A) 50 percent shall be paid by the Secretary of the 
     Treasury to the State within the boundaries of which the 
     leased land is located or the deposits were derived; and
       ``(B) 50 percent shall be deposited in a special fund in 
     the Treasury, to be known as the `BLM Permit Processing 
     Improvement Fund' (referred to in this subsection as the 
     `Fund').
       ``(3) For each of fiscal years 2006 through 2015, the Fund 
     shall be available to the Secretary of the Interior for 
     expenditure, without further appropriation and without fiscal 
     year limitation, for the coordination and processing of oil 
     and gas use authorizations on onshore Federal land under the 
     jurisdiction of the Pilot Project offices identified in 
     section 365(d) of the Energy Policy Act of 2005.''.
       (h) Transfer of Funds.--For the purposes of coordination 
     and processing of oil and gas use authorizations on Federal 
     land under the administration of the Pilot Project offices 
     identified in subsection (d), the Secretary may authorize the 
     expenditure or transfer of such funds as are necessary to--
       (1) the United States Fish and Wildlife Service;
       (2) the Bureau of Indian Affairs;
       (3) the Forest Service;
       (4) the Environmental Protection Agency;
       (5) the Corps of Engineers; and
       (6) the States of Wyoming, Montana, Colorado, Utah, and New 
     Mexico.
       (i) Fees.--During the period in which the Pilot Project is 
     authorized, the Secretary shall not implement a rulemaking 
     that would enable an increase in fees to recover additional 
     costs related to processing drilling-related permit 
     applications and use authorizations.
       (j) Savings Provision.--Nothing in this section affects--
       (1) the operation of any Federal or State law; or
       (2) any delegation of authority made by the head of a 
     Federal agency whose employees are participating in the Pilot 
     Project.

     SEC. 366. DEADLINE FOR CONSIDERATION OF APPLICATIONS FOR 
                   PERMITS.

       Section 17 of the Mineral Leasing Act (30 U.S.C. 226) is 
     amended by adding at the end the following:
       ``(p) Deadlines for Consideration of Applications for 
     Permits.--
       ``(1) In general.--Not later than 10 days after the date on 
     which the Secretary receives an application for any permit to 
     drill, the Secretary shall--
       ``(A) notify the applicant that the application is 
     complete; or
       ``(B) notify the applicant that information is missing and 
     specify any information that is required to be submitted for 
     the application to be complete.
       ``(2) Issuance or deferral.--Not later than 30 days after 
     the applicant for a permit has submitted a complete 
     application, the Secretary shall--
       ``(A) issue the permit, if the requirements under the 
     National Environmental Policy Act of 1969 and other 
     applicable law have been completed within such timeframe; or
       ``(B) defer the decision on the permit and provide to the 
     applicant a notice--
       ``(i) that specifies any steps that the applicant could 
     take for the permit to be issued; and
       ``(ii) a list of actions that need to be taken by the 
     agency to complete compliance with applicable law together 
     with timelines and deadlines for completing such actions.

[[Page 17831]]

       ``(3) Requirements for deferred applications.--
       ``(A) In general.--If the Secretary provides notice under 
     paragraph (2)(B), the applicant shall have a period of 2 
     years from the date of receipt of the notice in which to 
     complete all requirements specified by the Secretary, 
     including providing information needed for compliance with 
     the National Environmental Policy Act of 1969.
       ``(B) Issuance of decision on permit.--If the applicant 
     completes the requirements within the period specified in 
     subparagraph (A), the Secretary shall issue a decision on the 
     permit not later than 10 days after the date of completion of 
     the requirements described in subparagraph (A), unless 
     compliance with the National Environmental Policy Act of 1969 
     and other applicable law has not been completed within such 
     timeframe.
       ``(C) Denial of permit.--If the applicant does not complete 
     the requirements within the period specified in subparagraph 
     (A) or if the applicant does not comply with applicable law, 
     the Secretary shall deny the permit.''.

     SEC. 367. FAIR MARKET VALUE DETERMINATIONS FOR LINEAR RIGHTS-
                   OF-WAY ACROSS PUBLIC LANDS AND NATIONAL 
                   FORESTS.

       (a) Update of Fee Schedule.--Not later than one year after 
     the date of enactment of this section--
       (1) the Secretary of the Interior shall update section 
     2806.20 of title 43, Code of Federal Regulations, as in 
     effect on the date of enactment of this section, to revise 
     the per acre rental fee zone value schedule by State, county, 
     and type of linear right-of-way use to reflect current values 
     of land in each zone; and
       (2) the Secretary of Agriculture shall make the same 
     revision for linear rights-of-way granted, issued, or renewed 
     under title V of the Federal Lands Policy and Management Act 
     of 1976 (43 U.S.C. 1761 et seq.) on National Forest System 
     land.
       (b) Fair Market Value Rental Determination for Linear 
     Rights-of-way.--The fair market value rent of a linear right-
     of-way across public lands or National Forest System lands 
     issued under section 504 of the Federal Land Policy and 
     Management Act of 1976 (43 U.S.C. 1764) or section 28 of the 
     Mineral Leasing Act (30 U.S.C. 185) shall be determined in 
     accordance with subpart 2806 of title 43, Code of Federal 
     Regulations, as in effect on the date of enactment of this 
     section (including the annual or periodic updates specified 
     in the regulations) and as updated in accordance with 
     subsection (a).

     SEC. 368. ENERGY RIGHT-OF-WAY CORRIDORS ON FEDERAL LAND.

       (a) Western States.--Not later than 2 years after the date 
     of enactment of this Act, the Secretary of Agriculture, the 
     Secretary of Commerce, the Secretary of Defense, the 
     Secretary of Energy, and the Secretary of the Interior (in 
     this section referred to collectively as ``the 
     Secretaries''), in consultation with the Federal Energy 
     Regulatory Commission, States, tribal or local units of 
     governments as appropriate, affected utility industries, and 
     other interested persons, shall consult with each other and 
     shall--
       (1) designate, under their respective authorities, 
     corridors for oil, gas, and hydrogen pipelines and 
     electricity transmission and distribution facilities on 
     Federal land in the eleven contiguous Western States (as 
     defined in section 103(o) of the Federal Land Policy and 
     Management Act of 1976 (43 U.S.C. 1702(o));
       (2) perform any environmental reviews that may be required 
     to complete the designation of such corridors; and
       (3) incorporate the designated corridors into the relevant 
     agency land use and resource management plans or equivalent 
     plans.
       (b) Other States.--Not later than 4 years after the date of 
     enactment of this Act, the Secretaries, in consultation with 
     the Federal Energy Regulatory Commission, affected utility 
     industries, and other interested persons, shall jointly--
       (1) identify corridors for oil, gas, and hydrogen pipelines 
     and electricity transmission and distribution facilities on 
     Federal land in States other than those described in 
     subsection (a); and
       (2) schedule prompt action to identify, designate, and 
     incorporate the corridors into the applicable land use plans.
       (c) Ongoing Responsibilities.--The Secretaries, in 
     consultation with the Federal Energy Regulatory Commission, 
     affected utility industries, and other interested parties, 
     shall establish procedures under their respective authorities 
     that--
       (1) ensure that additional corridors for oil, gas, and 
     hydrogen pipelines and electricity transmission and 
     distribution facilities on Federal land are promptly 
     identified and designated as necessary; and
       (2) expedite applications to construct or modify oil, gas, 
     and hydrogen pipelines and electricity transmission and 
     distribution facilities within such corridors, taking into 
     account prior analyses and environmental reviews undertaken 
     during the designation of such corridors.
       (d) Considerations.--In carrying out this section, the 
     Secretaries shall take into account the need for upgraded and 
     new electricity transmission and distribution facilities to--
       (1) improve reliability;
       (2) relieve congestion; and
       (3) enhance the capability of the national grid to deliver 
     electricity.
       (e) Specifications of Corridor.--A corridor designated 
     under this section shall, at a minimum, specify the 
     centerline, width, and compatible uses of the corridor.

     SEC. 369. OIL SHALE, TAR SANDS, AND OTHER STRATEGIC 
                   UNCONVENTIONAL FUELS.

       (a) Short Title.--This section may be cited as the ``Oil 
     Shale, Tar Sands, and Other Strategic Unconventional Fuels 
     Act of 2005''.
       (b) Declaration of Policy.--Congress declares that it is 
     the policy of the United States that--
       (1) United States oil shale, tar sands, and other 
     unconventional fuels are strategically important domestic 
     resources that should be developed to reduce the growing 
     dependence of the United States on politically and 
     economically unstable sources of foreign oil imports;
       (2) the development of oil shale, tar sands, and other 
     strategic unconventional fuels, for research and commercial 
     development, should be conducted in an environmentally sound 
     manner, using practices that minimize impacts; and
       (3) development of those strategic unconventional fuels 
     should occur, with an emphasis on sustainability, to benefit 
     the United States while taking into account affected States 
     and communities.
       (c) Leasing Program for Research and Development of Oil 
     Shale and Tar Sands.--In accordance with section 21 of the 
     Mineral Leasing Act (30 U.S.C. 241) and any other applicable 
     law, except as provided in this section, not later than 180 
     days after the date of enactment of this Act, from land 
     otherwise available for leasing, the Secretary of the 
     Interior (referred to in this section as the ``Secretary'') 
     shall make available for leasing such land as the Secretary 
     considers to be necessary to conduct research and development 
     activities with respect to technologies for the recovery of 
     liquid fuels from oil shale and tar sands resources on public 
     lands. Prospective public lands within each of the States of 
     Colorado, Utah, and Wyoming shall be made available for such 
     research and development leasing.
       (d) Programmatic Environmental Impact Statement and 
     Commercial Leasing Program for Oil Shale and Tar Sands.--
       (1) Programmatic environmental impact statement.--Not later 
     than 18 months after the date of enactment of this Act, in 
     accordance with section 102(2)(C) of the National 
     Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)), the 
     Secretary shall complete a programmatic environmental impact 
     statement for a commercial leasing program for oil shale and 
     tar sands resources on public lands, with an emphasis on the 
     most geologically prospective lands within each of the States 
     of Colorado, Utah, and Wyoming.
       (2) Final regulation.--Not later than 6 months after the 
     completion of the programmatic environmental impact statement 
     under this subsection, the Secretary shall publish a final 
     regulation establishing such program.
       (e) Commencement of Commercial Leasing of Oil Shale and Tar 
     Sands.--Not later than 180 days after publication of the 
     final regulation required by subsection (d), the Secretary 
     shall consult with the Governors of States with significant 
     oil shale and tar sands resources on public lands, 
     representatives of local governments in such States, 
     interested Indian tribes, and other interested persons, to 
     determine the level of support and interest in the States in 
     the development of tar sands and oil shale resources. If the 
     Secretary finds sufficient support and interest exists in a 
     State, the Secretary may conduct a lease sale in that State 
     under the commercial leasing program regulations. Evidence of 
     interest in a lease sale under this subsection shall include, 
     but not be limited to, appropriate areas nominated for 
     leasing by potential lessees and other interested parties.
       (f) Diligent Development Requirements.--The Secretary 
     shall, by regulation, designate work requirements and 
     milestones to ensure the diligent development of the lease.
       (g) Initial Report by the Secretary of the Interior.--
     Within 90 days after the date of enactment of this Act, the 
     Secretary of the Interior shall report to the Committee on 
     Resources of the House of Representatives and the Committee 
     on Energy and Natural Resources of the Senate on--
       (1) the interim actions necessary to--
       (A) develop the program, complete the programmatic 
     environmental impact statement, and promulgate the final 
     regulation as required by subsection (d); and,
       (B) conduct the first lease sales under the program as 
     required by subsection (e); and
       (2) a schedule to complete such actions within the time 
     limits mandated by this section.
       (h) Task Force.--
       (1) Establishment.--The Secretary of Energy, in cooperation 
     with the Secretary of the Interior and the Secretary of 
     Defense, shall establish a task force to develop a program to 
     coordinate and accelerate the commercial development of 
     strategic unconventional fuels, including but not limited to 
     oil shale and tar sands resources within the United States, 
     in an integrated manner.
       (2) Composition.--The Task Force shall be composed of
       (A) the Secretary of Energy (or the designee of the 
     Secretary);
       (B) the Secretary of the Interior (or the designee of the 
     Secretary of the Interior);
       (C) the Secretary of Defense (or the designee of the 
     Secretary of Defense);
       (D) the Governors of affected States; and
       (E) representatives of local governments in affected areas.
       (3) Recommendations.--The Task Force shall make such 
     recommendations regarding promoting the development of the 
     strategic unconventional fuels resources within the United 
     States as it may deem appropriate.

[[Page 17832]]

       (4) Partnerships.--The Task Force shall make 
     recommendations with respect to initiating a partnership with 
     the Province of Alberta, Canada, for purposes of sharing 
     information relating to the development and production of oil 
     from tar sands, and similar partnerships with other nations 
     that contain significant oil shale resources
       (5) Reports.--
       (A) Initial report.--Not later than 180 days after the date 
     of enactment of this Act, the Task Force shall submit to the 
     President and Congress a report that describes the analysis 
     and recommendations of the Task Force.
       (B) Subsequent reports.--The Secretary shall provide an 
     annual report describing the progress in developing the 
     strategic unconventional fuels resources within the United 
     States for each of the 5 years following submission of the 
     report provided for in subparagraph (A).
       (i) Office of Petroleum Reserves.--
       (1) In general.--The Office of Petroleum Reserves of the 
     Department of Energy shall--
       (A) coordinate the creation and implementation of a 
     commercial strategic fuel development program for the United 
     States;
       (B) evaluate the strategic importance of unconventional 
     sources of strategic fuels to the security of the United 
     States;
       (C) promote and coordinate Federal Government actions that 
     facilitate the development of strategic fuels in order to 
     effectively address the energy supply needs of the United 
     States;
       (D) identify, assess, and recommend appropriate actions of 
     the Federal Government required to assist in the development 
     and manufacturing of strategic fuels; and
       (E) coordinate and facilitate appropriate relationships 
     between private industry and the Federal Government to 
     promote sufficient and timely private investment to 
     commercialize strategic fuels for domestic and military use.
       (2) Consultation and coordination.--The Office of Petroleum 
     Reserves shall work closely with the Task Force and 
     coordinate its staff support.
       (3) Annual reports.--Not later than 180 days after the date 
     of enactment of this Act and annually thereafter, the 
     Secretary shall submit to Congress a report that describes 
     the activities of the Office of Petroleum Reserves carried 
     out under this subsection.
       (j) Mineral Leasing Act Amendments.--
       (1) Section 17.--Section 17(b)(2) of the Mineral Leasing 
     Act (30 U.S.C. 226(b)(2)), as amended by section 350, is 
     further amended--
       (A) in subparagraph (A) (as designated by the amendment 
     made by subsection (a)(1) of that section) by designating the 
     first, second, and third sentences as clauses (i), (ii), and 
     (iii), respectively;
       (B) by moving clause (ii), as so designated, so as to begin 
     immediately after and below clause (i);
       (C) by moving clause (iii), as so designated, so as to 
     begin immediately after and below clause (ii);
       (D) in clause (i) of subparagraph (A) (as designated by 
     subparagraph (A) of this paragraph) by striking ``five 
     thousand one hundred and twenty'' and inserting ``5,760''; 
     and
       (E) by adding at the end the following:
       ``(iv) No lease issued under this paragraph shall be 
     included in any chargeability limitation associated with oil 
     and gas leases.''.
       (2) Section 21.--Section 21(a) of the Mineral Leasing Act 
     (30 U.S.C. 241(a)) is amended--
       (A) by striking ``(a) That the Secretary'' and inserting 
     the following:
       ``(a)(1) The Secretary'';
       (B) by striking ``; that no lease'' and inserting a period, 
     followed by the following:
       ``(2) No lease'';
       (C) by striking ``Leases may be for'' and inserting the 
     following:
       ``(3) Leases may be for'';
       (D) by striking ``For the privilege'' and inserting the 
     following:
       ``(4) For the privilege'';
       (E) in paragraph (2) (as designated by subparagraph (B) of 
     this paragraph) by striking ``five thousand one hundred and 
     twenty'' and inserting ``5,760'';
       (F) in paragraph (4) (as designated by subparagraph (D) of 
     this paragraph) by striking ``rate of 50 cents per acre'' and 
     inserting ``rate of $2.00 per acre'';
       (G)(i) by striking ``: Provided further, That not more than 
     one lease shall be granted under this section to any'' and 
     inserting ``: Provided further, That no''; and
       (ii) by striking ``except that with respect to leases for'' 
     and inserting ``shall acquire or hold more than 50,000 acres 
     of oil shale leases in any one State. For''; and
       (H) by adding at the end the following:
       ``(5) No lease issued under this section shall be included 
     in any chargeability limitation associated with oil and gas 
     leases.''.
       (k) Interagency Coordination and Expeditious Review of 
     Permitting Process.--
       (1) Department of the interior as lead agency.--Upon 
     written request of a prospective applicant for Federal 
     authorization to develop a proposed oil shale or tar sands 
     project, the Department of the Interior shall act as the lead 
     Federal agency for the purposes of coordinating all 
     applicable Federal authorizations and environmental reviews. 
     To the maximum extent practicable under applicable Federal 
     law, the Secretary shall coordinate this Federal 
     authorization and review process with any Indian tribes and 
     State and local agencies responsible for conducting any 
     separate permitting and environmental reviews.
       (2) Implementing regulations.--Not later than 6 months 
     after the date of enactment of this Act, the Secretary shall 
     issue any regulations necessary to implement this subsection.
       (l) Cost-shared Demonstration Technologies.--
       (1) Identification.--The Secretary of Energy shall identify 
     technologies for the development of oil shale and tar sands 
     that--
       (A) are ready for demonstration at a commercially-
     representative scale; and
       (B) have a high probability of leading to commercial 
     production.
       (2) Assistance.--For each technology identified under 
     paragraph (1), the Secretary of Energy may provide--
       (A) technical assistance;
       (B) assistance in meeting environmental and regulatory 
     requirements; and
       (C) cost-sharing assistance.
       (m) National Oil Shale and Tar Sands Assessment.--
       (1) Assessment.--
       (A) In general.--The Secretary shall carry out a national 
     assessment of oil shale and tar sands resources for the 
     purposes of evaluating and mapping oil shale and tar sands 
     deposits, in the geographic areas described in subparagraph 
     (B). In conducting such an assessment, the Secretary shall 
     make use of the extensive geological assessment work for oil 
     shale and tar sands already conducted by the United States 
     Geological Survey.
       (B) Geographic areas.--The geographic areas referred to in 
     subparagraph (A), listed in the order in which the Secretary 
     shall assign priority, are--
       (i) the Green River Region of the States of Colorado, Utah, 
     and Wyoming;
       (ii) the Devonian oil shales and other hydrocarbon-bearing 
     rocks having the nomenclature of ``shale'' located east of 
     the Mississippi River; and
       (iii) any remaining area in the central and western United 
     States (including the State of Alaska) that contains oil 
     shale and tar sands, as determined by the Secretary.
       (2) Use of state surveys and universities.--In carrying out 
     the assessment under paragraph (1), the Secretary may request 
     assistance from any State- administered geological survey or 
     university.
       (n) Land Exchanges.--
       (1) In general.--To facilitate the recovery of oil shale 
     and tar sands, especially in areas where Federal, State, and 
     private lands are intermingled, the Secretary shall consider 
     the use of land exchanges where appropriate and feasible to 
     consolidate land ownership and mineral interests into 
     manageable areas.
       (2) Identification and priority of public lands.--The 
     Secretary shall identify public lands containing deposits of 
     oil shale or tar sands within the Green River, Piceance 
     Creek, Uintah, and Washakie geologic basins, and shall give 
     priority to implementing land exchanges within those basins. 
     The Secretary shall consider the geology of the respective 
     basin in determining the optimum size of the lands to be 
     consolidated.
       (3) Compliance with section 206 of flpma.--A land exchange 
     undertaken in furtherance of this subsection shall be 
     implemented in accordance with section 206 of the Federal 
     Land Policy and Management Act of 1976 (43 U.S.C. 1716).
       (o) Royalty Rates for Leases.--The Secretary shall 
     establish royalties, fees, rentals, bonus, or other payments 
     for leases under this section that shall--
       (1) encourage development of the oil shale and tar sands 
     resource; and
       (2) ensure a fair return to the United States.
       (p) Heavy Oil Technical and Economic Assessment.--The 
     Secretary of Energy shall update the 1987 technical and 
     economic assessment of domestic heavy oil resources that was 
     prepared by the Interstate Oil and Gas Compact Commission. 
     Such an update should include all of North America and cover 
     all unconventional oil, including heavy oil, tar sands (oil 
     sands), and oil shale.
       (q) Procurement of Unconventional Fuels by the Department 
     of Defense.--
       (1) In general.--Chapter 141 of title 10, United States 
     Code, is amended by inserting after section 2398 the 
     following:

     ``Sec. 2398a. Procurement of fuel derived from coal, oil 
       shale, and tar sands

       ``(a) Use of Fuel to Meet Department of Defense Needs.--The 
     Secretary of Defense shall develop a strategy to use fuel 
     produced, in whole or in part, from coal, oil shale, and tar 
     sands (referred to in this section as a `covered fuel') that 
     are extracted by either mining or in-situ methods and refined 
     or otherwise processed in the United States in order to 
     assist in meeting the fuel requirements of the Department of 
     Defense when the Secretary determines that it is in the 
     national interest.
       ``(b) Authority To Procure.--The Secretary of Defense may 
     enter into 1 or more contracts or other agreements (that meet 
     the requirements of this section) to procure a covered fuel 
     to meet 1 or more fuel requirements of the Department of 
     Defense.
       ``(c) Clean Fuel Requirements.--A covered fuel may be 
     procured under subsection (b) only if the covered fuel meets 
     such standards for clean fuel produced from domestic sources 
     as the Secretary of Defense shall establish for purposes of 
     this section in consultation with the Department of Energy.
       ``(d) Multiyear Contract Authority.--Subject to applicable 
     provisions of law, any contract or other agreement for the 
     procurement of covered fuel under subsection (b) may be for 1 
     or more years at the election of the Secretary of Defense.
       ``(e) Fuel Source Analysis.--In order to facilitate the 
     procurement by the Department of

[[Page 17833]]

     Defense of covered fuel under subsection (b), the Secretary 
     of Defense may carry out a comprehensive assessment of 
     current and potential locations in the United States for the 
     supply of covered fuel to the Department.''.
       (2) Clerical amendment.--The table of sections for chapter 
     141 of title 10, United States Code, is amended by inserting 
     after the item relating to section 2398 the following:

``2398a. Procurement of fuel derived from coal, oil shale, and tar 
              sands''.
       (r) State Water Rights.--Nothing in this section preempts 
     or affects any State water law or interstate compact relating 
     to water.
       (s) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section.

     SEC. 370. FINGER LAKES WITHDRAWAL.

       All Federal land within the boundary of Finger Lakes 
     National Forest in the State of New York is withdrawn from--
       (1) all forms of entry, appropriation, or disposal under 
     the public land laws; and
       (2) disposition under all laws relating to oil and gas 
     leasing.

     SEC. 371. REINSTATEMENT OF LEASES.

       (a) Leases Terminated for Certain Failure to Pay Rental.--
     Notwithstanding section 31(d)(2)(B) of the Mineral Leasing 
     Act (30 U.S.C. 188(d)(2)(B)) as in effect before the 
     effective date of this section, and notwithstanding the 
     amendment made by subsection (b) of this section, the 
     Secretary of the Interior may reinstate any oil and gas lease 
     issued under that Act that was terminated for failure of a 
     lessee to pay the full amount of rental on or before the 
     anniversary date of the lease, during the period beginning on 
     September 1, 2001, and ending on June 30, 2004, if--
       (1) not later than 120 days after the date of enactment of 
     this Act, the lessee--
       (A) files a petition for reinstatement of the lease;
       (B) complies with the conditions of section 31(e) of the 
     Mineral Leasing Act (30 U.S.C. 188(e)); and
       (C) certifies that the lessee did not receive a notice of 
     termination by the date that was 13 months before the date of 
     termination; and
       (2) the land is available for leasing.
       (b) Deadline for Petitions, Generally.--Section 31(d)(2) of 
     the Mineral Leasing Act (30 U.S.C. 188(d)(2)) is amended by 
     striking subparagraphs (A) and (B) and inserting the 
     following:
       ``(A) with respect to any lease that terminated under 
     subsection (b) on or before the date of the enactment of the 
     Energy Policy Act of 2005, a petition for reinstatement 
     (together with the required back rental and royalty accruing 
     after the date of termination) is filed on or before the 
     earlier of--
       ``(i) 60 days after the lessee receives from the Secretary 
     notice of termination, whether by return of check or by any 
     other form of actual notice; or
       ``(ii) 15 months after the termination of the lease; or
       ``(B) with respect to any lease that terminates under 
     subsection (b) after the date of the enactment of the Energy 
     Policy Act of 2005, a petition for reinstatement (together 
     with the required back rental and royalty accruing after the 
     date of termination) is filed on or before the earlier of--
       ``(i) 60 days after receipt of the notice of termination 
     sent by the Secretary by certified mail to all lessees of 
     record; or
       ``(ii) 24 months after the termination of the lease.''.

     SEC. 372. CONSULTATION REGARDING ENERGY RIGHTS-OF-WAY ON 
                   PUBLIC LAND.

       (a) Memorandum of Understanding.--
       (1) In general.--Not later than 6 months after the date of 
     enactment of this Act, the Secretary of Energy, in 
     consultation with the Secretary of the Interior, the 
     Secretary of Agriculture, and the Secretary of Defense with 
     respect to lands under their respective jurisdictions, shall 
     enter into a memorandum of understanding to coordinate all 
     applicable Federal authorizations and environmental reviews 
     relating to a proposed or existing utility facility. To the 
     maximum extent practicable under applicable law, the 
     Secretary of Energy shall, to ensure timely review and permit 
     decisions, coordinate such authorizations and reviews with 
     any Indian tribes, multi-State entities, and State agencies 
     that are responsible for conducting any separate permitting 
     and environmental reviews of the affected utility facility.
       (2) Contents.--The memorandum of understanding shall 
     include provisions that--
       (A) establish--
       (i) a unified right-of-way application form; and
       (ii) an administrative procedure for processing right-of-
     way applications, including lines of authority, steps in 
     application processing, and timeframes for application 
     processing;
       (B) provide for coordination of planning relating to the 
     granting of the rights-of-way;
       (C) provide for an agreement among the affected Federal 
     agencies to prepare a single environmental review document to 
     be used as the basis for all Federal authorization decisions; 
     and
       (D) provide for coordination of use of right-of-way 
     stipulations to achieve consistency.
       (b) Natural Gas Pipelines.--
       (1) In general.--With respect to permitting activities for 
     interstate natural gas pipelines, the May 2002 document 
     entitled ``Interagency Agreement On Early Coordination Of 
     Required Environmental And Historic Preservation Reviews 
     Conducted In Conjunction With The Issuance Of Authorizations 
     To Construct And Operate Interstate Natural Gas Pipelines 
     Certificated By The Federal Energy Regulatory Commission'' 
     shall constitute compliance with subsection (a).
       (2) Report.--
       (A) In general.--Not later than 1 year after the date of 
     enactment of this Act, and every 2 years thereafter, agencies 
     that are signatories to the document referred to in paragraph 
     (1) shall transmit to Congress a report on how the agencies 
     under the jurisdiction of the Secretaries are incorporating 
     and implementing the provisions of the document referred to 
     in paragraph (1).
       (B) Contents.--The report shall address--
       (i) efforts to implement the provisions of the document 
     referred to in paragraph (1);
       (ii) whether the efforts have had a streamlining effect;
       (iii) further improvements to the permitting process of the 
     agency; and
       (iv) recommendations for inclusion of State and tribal 
     governments in a coordinated permitting process.
       (c) Definition of Utility Facility.--In this section, the 
     term ``utility facility'' means any privately, publicly, or 
     cooperatively owned line, facility, or system--
       (1) for the transportation of--
       (A) oil, natural gas, synthetic liquid fuel, or gaseous 
     fuel;
       (B) any refined product produced from oil, natural gas, 
     synthetic liquid fuel, or gaseous fuel; or
       (C) products in support of the production of material 
     referred to in subparagraph (A) or (B);
       (2) for storage and terminal facilities in connection with 
     the production of material referred to in paragraph (1); or
       (3) for the generation, transmission, and distribution of 
     electric energy.

     SEC. 373. SENSE OF CONGRESS REGARDING DEVELOPMENT OF MINERALS 
                   UNDER PADRE ISLAND NATIONAL SEASHORE.

       (a) Findings.--Congress finds the following:
       (1) Pursuant to Public Law 87-712 (16 U.S.C. 459d et seq.; 
     popularly known as the ``Federal Enabling Act'') and various 
     deeds and actions under that Act, the United States is the 
     owner of only the surface estate of certain lands 
     constituting the Padre Island National Seashore.
       (2) Ownership of the oil, gas, and other minerals in the 
     subsurface estate of the lands constituting the Padre Island 
     National Seashore was never acquired by the United States, 
     and ownership of those interests is held by the State of 
     Texas and private parties.
       (3) Public Law 87-712 (16 U.S.C. 459d et seq.)--
       (A) expressly contemplated that the United States would 
     recognize the ownership and future development of the oil, 
     gas, and other minerals in the subsurface estate of the lands 
     constituting the Padre Island National Seashore by the owners 
     and their mineral lessees; and
       (B) recognized that approval of the State of Texas was 
     required to create Padre Island National Seashore.
       (4) Approval was given for the creation of Padre Island 
     National Seashore by the State of Texas through Tex. Rev. 
     Civ. Stat. Ann. Art. 6077(t) (Vernon 1970), which expressly 
     recognized that development of the oil, gas, and other 
     minerals in the subsurface of the lands constituting Padre 
     Island National Seashore would be conducted with full rights 
     of ingress and egress under the laws of the State of Texas.
       (b) Sense of Congress.--It is the sense of Congress that 
     with regard to Federal law, any regulation of the development 
     of oil, gas, or other minerals in the subsurface of the lands 
     constituting Padre Island National Seashore should be made as 
     if those lands retained the status that the lands had on 
     September 27, 1962.

     SEC. 374. LIVINGSTON PARISH MINERAL RIGHTS TRANSFER.

       Section 102 of Public Law 102-562 (106 Stat. 4234) is 
     amended by striking subsection (b) and inserting the 
     following:
       ``(b) Reservation of Oil and Gas Rights and Conveyance of 
     Remaining Mineral Rights.--Subject to the limitations set 
     forth in subsection (c), the United States hereby excepts and 
     reserves from the provisions of subsection (a), all rights to 
     oil and gas underlying such lands, along with the right to 
     explore for, and produce the oil and gas under applicable law 
     and such regulations as the Secretary of the Interior may 
     prescribe. Not later than 180 days after the date of 
     enactment of the Energy Policy Act of 2005, the Secretary of 
     the Interior shall convey the remaining mineral rights to the 
     parties who as of the date of enactment of the Energy Policy 
     Act of 2005 would be recognized as holders of a right, title, 
     or interest to any portion of such minerals under the laws of 
     the State of Louisiana, but for the interest of the United 
     States in such minerals.
       ``(c) Oil and Gas Resource Assessment and Report.--The 
     United States Geological Survey shall conduct a resource 
     assessment and publish a report of the findings of such 
     resource assessment (`USGS Assessment and Report') within one 
     year of the date of enactment of the Energy Policy Act of 
     2005. The USGS Assessment and Report shall provide an 
     assessment of all oil and gas resources underlying the 
     certain lands in Livingston Parish, Louisiana, as described 
     in section 103 (the `Livingston Parish lands'). Upon a 
     finding by the Secretary of the Interior based upon the USGS 
     Assessment and Report that it is unlikely that economically 
     recoverable oil and gas resources are present, the Secretary 
     shall convey all rights to oil and gas underlying such lands 
     to the recipients, or their successors,

[[Page 17834]]

     heirs, or assigns, of the conveyances under subsection (b). 
     Such further conveyances shall be made within 180 days after 
     a finding by the Secretary that it is unlikely that 
     economically recoverable oil and gas resources are 
     present.''.
                       Subtitle G--Miscellaneous

     SEC. 381. DEADLINE FOR DECISION ON APPEALS OF CONSISTENCY 
                   DETERMINATION UNDER THE COASTAL ZONE MANAGEMENT 
                   ACT OF 1972.

       Section 319 of the Coastal Zone Management Act of 1972 (16 
     U.S.C. 1465) is amended to read as follows:


                       ``APPEALS TO THE SECRETARY

       ``Sec. 319. (a) Notice.--Not later than 30 days after the 
     date of the filing of an appeal to the Secretary of a 
     consistency determination under section 307, the Secretary 
     shall publish an initial notice in the Federal Register.
       ``(b) Closure of Record.--
       ``(1) In general.--Not later than the end of the 160-day 
     period beginning on the date of publication of an initial 
     notice under subsection (a), except as provided in paragraph 
     (3), the Secretary shall immediately close the decision 
     record and receive no more filings on the appeal.
       ``(2) Notice.--After closing the administrative record, the 
     Secretary shall immediately publish a notice in the Federal 
     Register that the administrative record has been closed.
       ``(3) Exception.--
       ``(A) In general.--Subject to subparagraph (B), during the 
     160-day period described in paragraph (1), the Secretary may 
     stay the closing of the decision record--
       ``(i) for a specific period mutually agreed to in writing 
     by the appellant and the State agency; or
       ``(ii) as the Secretary determines necessary to receive, on 
     an expedited basis--

       ``(I) any supplemental information specifically requested 
     by the Secretary to complete a consistency review under this 
     Act; or
       ``(II) any clarifying information submitted by a party to 
     the proceeding related to information in the consolidated 
     record compiled by the lead Federal permitting agency.

       ``(B) Applicability.--The Secretary may only stay the 160-
     day period described in paragraph (1) for a period not to 
     exceed 60 days.
       ``(c) Deadline for Decision.--
       ``(1) In general.--Not later than 60 days after the date of 
     publication of a Federal Register notice stating when the 
     decision record for an appeal has been closed, the Secretary 
     shall issue a decision or publish a notice in the Federal 
     Register explaining why a decision cannot be issued at that 
     time.
       ``(2) Subsequent decision.--Not later than 15 days after 
     the date of publication of a Federal Register notice 
     explaining why a decision cannot be issued within the 60-day 
     period, the Secretary shall issue a decision.''.

     SEC. 382. APPEALS RELATING TO OFFSHORE MINERAL DEVELOPMENT.

       For any Federal administrative agency proceeding that is an 
     appeal or review under section 319 of the Coastal Zone 
     Management Act of 1972 (16 U.S.C. 1465), as amended by this 
     Act, related to any Federal authorization for the permitting, 
     approval, or other authorization of an energy project, the 
     lead Federal permitting agency for the project shall, with 
     the cooperation of Federal and State administrative agencies, 
     maintain a consolidated record of all decisions made or 
     actions taken by the lead agency or by another Federal or 
     State administrative agency or officer. Such record shall be 
     the initial record for appeals or reviews under that Act, 
     provided that the record may be supplemented as expressly 
     provided pursuant to section 319 of that Act.

     SEC. 383. ROYALTY PAYMENTS UNDER LEASES UNDER THE OUTER 
                   CONTINENTAL SHELF LANDS ACT.

       (a) Royalty Relief.--
       (1) In general.--For purposes of providing compensation for 
     lessees and a State for which amounts are authorized by 
     section 6004(c) of the Oil Pollution Act of 1990 (Public Law 
     101-380), a lessee may withhold from payment any royalty due 
     and owing to the United States under any leases under the 
     Outer Continental Shelf Lands Act (43 U.S.C. 1301 et seq.) 
     for offshore oil or gas production from a covered lease tract 
     if, on or before the date that the payment is due and payable 
     to the United States, the lessee makes a payment to the State 
     of 44 cents for every $1 of royalty withheld.
       (2) Treatment of amounts.--Any royalty withheld by a lessee 
     in accordance with this section (including any portion 
     thereof that is paid to the State under paragraph (1)) shall 
     be treated as paid for purposes of satisfaction of the 
     royalty obligations of the lessee to the United States.
       (3) Certification of withheld amounts.--The Secretary of 
     the Treasury shall--
       (A) determine the amount of royalty withheld by a lessee 
     under this section; and
       (B) promptly publish a certification when the total amount 
     of royalty withheld by the lessee under this section is equal 
     to--
       (i) the dollar amount stated at page 47 of Senate Report 
     number 101-534, which is designated therein as the total 
     drainage claim for the West Delta field; plus
       (ii) interest as described at page 47 of that Report.
       (b) Period of Royalty Relief.--Subsection (a) shall apply 
     to royalty amounts that are due and payable in the period 
     beginning on October 1, 2006, and ending on the date on which 
     the Secretary of the Treasury publishes a certification under 
     subsection (a)(3)(B).
       (c) Definitions.--As used in this section:
       (1) Covered lease tract.--The term ``covered lease tract'' 
     means a leased tract (or portion of a leased tract)--
       (A) lying seaward of the zone defined and governed by 
     section 8(g) of the Outer Continental Shelf Lands Act (43 
     U.S.C. 1337(g)); or
       (B) lying within such zone but to which such section does 
     not apply.
       (2) Lessee.--The term ``lessee''--
       (A) means a person or entity that, on the date of the 
     enactment of the Oil Pollution Act of 1990, was a lessee 
     referred to in section 6004(c) of that Act (as in effect on 
     that date of the enactment), but did not hold lease rights in 
     Federal offshore lease OCS-G-5669; and
       (B) includes successors and affiliates of a person or 
     entity described in subparagraph (A).

     SEC. 384. COASTAL IMPACT ASSISTANCE PROGRAM.

       Section 31 of the Outer Continental Shelf Lands Act (43 
     U.S.C. 1356a) is amended to read as follows:

     ``SEC. 31. COASTAL IMPACT ASSISTANCE PROGRAM.

       ``(a) Definitions.--In this section:
       ``(1) Coastal political subdivision.--The term `coastal 
     political subdivision' means a political subdivision of a 
     coastal State any part of which political subdivision is--
       ``(A) within the coastal zone (as defined in section 304 of 
     the Coastal Zone Management Act of 1972 (16 U.S.C. 1453)) of 
     the coastal State as of the date of enactment of the Energy 
     Policy Act of 2005; and
       ``(B) not more than 200 nautical miles from the geographic 
     center of any leased tract.
       ``(2) Coastal population.--The term `coastal population' 
     means the population, as determined by the most recent 
     official data of the Census Bureau, of each political 
     subdivision any part of which lies within the designated 
     coastal boundary of a State (as defined in a State's coastal 
     zone management program under the Coastal Zone Management Act 
     of 1972 (16 U.S.C. 1451 et seq.)).
       ``(3) Coastal state.--The term `coastal State' has the 
     meaning given the term in section 304 of the Coastal Zone 
     Management Act of 1972 (16 U.S.C. 1453).
       ``(4) Coastline.--The term `coastline' has the meaning 
     given the term `coast line' in section 2 of the Submerged 
     Lands Act (43 U.S.C. 1301).
       ``(5) Distance.--The term `distance' means the minimum 
     great circle distance, measured in statute miles.
       ``(6) Leased tract.--The term `leased tract' means a tract 
     that is subject to a lease under section 6 or 8 for the 
     purpose of drilling for, developing, and producing oil or 
     natural gas resources.
       ``(7) Leasing moratoria.--The term `leasing moratoria' 
     means the prohibitions on preleasing, leasing, and related 
     activities on any geographic area of the outer Continental 
     Shelf as contained in sections 107 through 109 of division E 
     of the Consolidated Appropriations Act, 2005 (Public Law 108-
     447; 118 Stat. 3063).
       ``(8) Political subdivision.--The term `political 
     subdivision' means the local political jurisdiction 
     immediately below the level of State government, including 
     counties, parishes, and boroughs.
       ``(9) Producing state.--
       ``(A) In general.--The term `producing State' means a 
     coastal State that has a coastal seaward boundary within 200 
     nautical miles of the geographic center of a leased tract 
     within any area of the outer Continental Shelf.
       ``(B) Exclusion.--The term `producing State' does not 
     include a producing State, a majority of the coastline of 
     which is subject to leasing moratoria, unless production was 
     occurring on January 1, 2005, from a lease within 10 nautical 
     miles of the coastline of that State.
       ``(10) Qualified outer continental shelf revenues.--
       ``(A) In general.--The term `qualified Outer Continental 
     Shelf revenues' means all amounts received by the United 
     States from each leased tract or portion of a leased tract--
       ``(i) lying--

       ``(I) seaward of the zone covered by section 8(g); or
       ``(II) within that zone, but to which section 8(g) does not 
     apply; and

       ``(ii) the geographic center of which lies within a 
     distance of 200 nautical miles from any part of the coastline 
     of any coastal State.
       ``(B) Inclusions.--The term `qualified Outer Continental 
     Shelf revenues' includes bonus bids, rents, royalties 
     (including payments for royalty taken in kind and sold), net 
     profit share payments, and related late-payment interest from 
     natural gas and oil leases issued under this Act.
       ``(C) Exclusion.--The term `qualified Outer Continental 
     Shelf revenues' does not include any revenues from a leased 
     tract or portion of a leased tract that is located in a 
     geographic area subject to a leasing moratorium on January 1, 
     2005, unless the lease was in production on January 1, 2005.
       ``(b) Payments to Producing States and Coastal Political 
     Subdivisions.--
       ``(1) In general.--The Secretary shall, without further 
     appropriation, disburse to producing States and coastal 
     political subdivisions in accordance with this section 
     $250,000,000 for each of fiscal years 2007 through 2010.
       ``(2) Disbursement.--In each fiscal year, the Secretary 
     shall disburse to each producing State for which the 
     Secretary has approved a plan under subsection (c), and to 
     coastal political subdivisions under paragraph (4), such 
     funds as are allocated to the producing State or coastal 
     political subdivision, respectively, under this section for 
     the fiscal year.
       ``(3) Allocation among producing states.--
       ``(A) In general.--Except as provided in subparagraph (C) 
     and subject to subparagraph (D),

[[Page 17835]]

     the amounts available under paragraph (1) shall be allocated 
     to each producing State based on the ratio that--
       ``(i) the amount of qualified outer Continental Shelf 
     revenues generated off the coastline of the producing State; 
     bears to
       ``(ii) the amount of qualified outer Continental Shelf 
     revenues generated off the coastline of all producing States.
       ``(B) Amount of outer continental shelf revenues.--For 
     purposes of subparagraph (A)--
       ``(i) the amount of qualified outer Continental Shelf 
     revenues for each of fiscal years 2007 and 2008 shall be 
     determined using qualified outer Continental Shelf revenues 
     received for fiscal year 2006; and
       ``(ii) the amount of qualified outer Continental Shelf 
     revenues for each of fiscal years 2009 and 2010 shall be 
     determined using qualified outer Continental Shelf revenues 
     received for fiscal year 2008.
       ``(C) Multiple producing states.--In a case in which more 
     than 1 producing State is located within 200 nautical miles 
     of any portion of a leased tract, the amount allocated to 
     each producing State for the leased tract shall be inversely 
     proportional to the distance between--
       ``(i) the nearest point on the coastline of the producing 
     State; and
       ``(ii) the geographic center of the leased tract.
       ``(D) Minimum allocation.--The amount allocated to a 
     producing State under subparagraph (A) shall be at least 1 
     percent of the amounts available under paragraph (1).
       ``(4) Payments to coastal political subdivisions.--
       ``(A) In general.--The Secretary shall pay 35 percent of 
     the allocable share of each producing State, as determined 
     under paragraph (3) to the coastal political subdivisions in 
     the producing State.
       ``(B) Formula.--Of the amount paid by the Secretary to 
     coastal political subdivisions under subparagraph (A)--
       ``(i) 25 percent shall be allocated to each coastal 
     political subdivision in the proportion that--

       ``(I) the coastal population of the coastal political 
     subdivision; bears to
       ``(II) the coastal population of all coastal political 
     subdivisions in the producing State;

       ``(ii) 25 percent shall be allocated to each coastal 
     political subdivision in the proportion that--

       ``(I) the number of miles of coastline of the coastal 
     political subdivision; bears to
       ``(II) the number of miles of coastline of all coastal 
     political subdivisions in the producing State; and

       ``(iii) 50 percent shall be allocated in amounts that are 
     inversely proportional to the respective distances between 
     the points in each coastal political subdivision that are 
     closest to the geographic center of each leased tract, as 
     determined by the Secretary.
       ``(C) Exception for the state of louisiana.--For the 
     purposes of subparagraph (B)(ii), the coastline for coastal 
     political subdivisions in the State of Louisiana without a 
     coastline shall be considered to be \1/3\ the average length 
     of the coastline of all coastal political subdivisions with a 
     coastline in the State of Louisiana.
       ``(D) Exception for the state of alaska.--For the purposes 
     of carrying out subparagraph (B)(iii) in the State of Alaska, 
     the amounts allocated shall be divided equally among the 2 
     coastal political subdivisions that are closest to the 
     geographic center of a leased tract.
       ``(E) Exclusion of certain leased tracts.--For purposes of 
     subparagraph (B)(iii), a leased tract or portion of a leased 
     tract shall be excluded if the tract or portion of a leased 
     tract is located in a geographic area subject to a leasing 
     moratorium on January 1, 2005, unless the lease was in 
     production on that date.
       ``(5) No approved plan.--
       ``(A) In general.--Subject to subparagraph (B) and except 
     as provided in subparagraph (C), in a case in which any 
     amount allocated to a producing State or coastal political 
     subdivision under paragraph (4) or (5) is not disbursed 
     because the producing State does not have in effect a plan 
     that has been approved by the Secretary under subsection (c), 
     the Secretary shall allocate the undisbursed amount equally 
     among all other producing States.
       ``(B) Retention of allocation.--The Secretary shall hold in 
     escrow an undisbursed amount described in subparagraph (A) 
     until such date as the final appeal regarding the disapproval 
     of a plan submitted under subsection (c) is decided.
       ``(C) Waiver.--The Secretary may waive subparagraph (A) 
     with respect to an allocated share of a producing State and 
     hold the allocable share in escrow if the Secretary 
     determines that the producing State is making a good faith 
     effort to develop and submit, or update, a plan in accordance 
     with subsection (c).
       ``(c) Coastal Impact Assistance Plan.--
       ``(1) Submission of state plans.--
       ``(A) In general.--Not later than July 1, 2008, the 
     Governor of a producing State shall submit to the Secretary a 
     coastal impact assistance plan.
       ``(B) Public participation.--In carrying out subparagraph 
     (A), the Governor shall solicit local input and provide for 
     public participation in the development of the plan.
       ``(2) Approval.--
       ``(A) In general.--The Secretary shall approve a plan of a 
     producing State submitted under paragraph (1) before 
     disbursing any amount to the producing State, or to a coastal 
     political subdivision located in the producing State, under 
     this section.
       ``(B) Components.--The Secretary shall approve a plan 
     submitted under paragraph (1) if--
       ``(i) the Secretary determines that the plan is consistent 
     with the uses described in subsection (d); and
       ``(ii) the plan contains--

       ``(I) the name of the State agency that will have the 
     authority to represent and act on behalf of the producing 
     State in dealing with the Secretary for purposes of this 
     section;
       ``(II) a program for the implementation of the plan that 
     describes how the amounts provided under this section to the 
     producing State will be used;
       ``(III) for each coastal political subdivision that 
     receives an amount under this section--

       ``(aa) the name of a contact person; and
       ``(bb) a description of how the coastal political 
     subdivision will use amounts provided under this section;

       ``(IV) a certification by the Governor that ample 
     opportunity has been provided for public participation in the 
     development and revision of the plan; and
       ``(V) a description of measures that will be taken to 
     determine the availability of assistance from other relevant 
     Federal resources and programs.

       ``(3) Amendment.--Any amendment to a plan submitted under 
     paragraph (1) shall be--
       ``(A) developed in accordance with this subsection; and
       ``(B) submitted to the Secretary for approval or 
     disapproval under paragraph (4).
       ``(4) Procedure.--Not later than 90 days after the date on 
     which a plan or amendment to a plan is submitted under 
     paragraph (1) or (3), the Secretary shall approve or 
     disapprove the plan or amendment.
       ``(d) Authorized Uses.--
       ``(1) In general.--A producing State or coastal political 
     subdivision shall use all amounts received under this 
     section, including any amount deposited in a trust fund that 
     is administered by the State or coastal political subdivision 
     and dedicated to uses consistent with this section, in 
     accordance with all applicable Federal and State law, only 
     for 1 or more of the following purposes:
       ``(A) Projects and activities for the conservation, 
     protection, or restoration of coastal areas, including 
     wetland.
       ``(B) Mitigation of damage to fish, wildlife, or natural 
     resources.
       ``(C) Planning assistance and the administrative costs of 
     complying with this section.
       ``(D) Implementation of a federally-approved marine, 
     coastal, or comprehensive conservation management plan.
       ``(E) Mitigation of the impact of outer Continental Shelf 
     activities through funding of onshore infrastructure projects 
     and public service needs.
       ``(2) Compliance with authorized uses.--If the Secretary 
     determines that any expenditure made by a producing State or 
     coastal political subdivision is not consistent with this 
     subsection, the Secretary shall not disburse any additional 
     amount under this section to the producing State or the 
     coastal political subdivision until such time as all amounts 
     obligated for unauthorized uses have been repaid or 
     reobligated for authorized uses.
       ``(3) Limitation.--Not more than 23 percent of amounts 
     received by a producing State or coastal political 
     subdivision for any 1 fiscal year shall be used for the 
     purposes described subparagraphs (C) and (E) of paragraph 
     (1).''.

     SEC. 385. STUDY OF AVAILABILITY OF SKILLED WORKERS.

       (a) In General.--The Secretary shall enter into an 
     arrangement with the National Academy of Sciences under which 
     the National Academy of Sciences shall conduct a study of the 
     short-term and long-term availability of skilled workers to 
     meet the energy and mineral security requirements of the 
     United States.
       (b) Inclusions.--The study shall include an analysis of--
       (1) the need for and availability of workers for the oil, 
     gas, and mineral industries;
       (2) the availability of skilled labor at both entry level 
     and more senior levels; and
       (3) recommendations for future actions needed to meet 
     future labor requirements.
       (c) Report.--Not later than 2 years after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     a report that describes the results of the study.

     SEC. 386. GREAT LAKES OIL AND GAS DRILLING BAN.

       No Federal or State permit or lease shall be issued for new 
     oil and gas slant, directional, or offshore drilling in or 
     under one or more of the Great Lakes.

     SEC. 387. FEDERAL COALBED METHANE REGULATION.

       Any State currently on the list of Affected States 
     established under section 1339(b) of the Energy Policy Act of 
     1992 (42 U.S.C. 13368(b)) shall be removed from the list if, 
     not later than 3 years after the date of enactment of this 
     Act, the State takes, or prior to the date of enactment has 
     taken, any of the actions required for removal from the list 
     under such section 1339(b).

     SEC. 388. ALTERNATE ENERGY-RELATED USES ON THE OUTER 
                   CONTINENTAL SHELF.

       (a) Amendment to Outer Continental Shelf Lands Act.--
     Section 8 of the Outer Continental Shelf Lands Act (43 U.S.C. 
     1337) is amended by adding at the end the following:
       ``(p) Leases, Easements, or Rights-of-way for Energy and 
     Related Purposes.--
       ``(1) In general.--The Secretary, in consultation with the 
     Secretary of the Department in which the Coast Guard is 
     operating and other

[[Page 17836]]

     relevant departments and agencies of the Federal Government, 
     may grant a lease, easement, or right-of-way on the outer 
     Continental Shelf for activities not otherwise authorized in 
     this Act, the Deepwater Port Act of 1974 (33 U.S.C. 1501 et 
     seq.), the Ocean Thermal Energy Conversion Act of 1980 (42 
     U.S.C. 9101 et seq.), or other applicable law, if those 
     activities--
       ``(A) support exploration, development, production, or 
     storage of oil or natural gas, except that a lease, easement, 
     or right-of-way shall not be granted in an area in which oil 
     and gas preleasing, leasing, and related activities are 
     prohibited by a moratorium;
       ``(B) support transportation of oil or natural gas, 
     excluding shipping activities;
       ``(C) produce or support production, transportation, or 
     transmission of energy from sources other than oil and gas; 
     or
       ``(D) use, for energy-related purposes or for other 
     authorized marine-related purposes, facilities currently or 
     previously used for activities authorized under this Act, 
     except that any oil and gas energy-related uses shall not be 
     authorized in areas in which oil and gas preleasing, leasing, 
     and related activities are prohibited by a moratorium.
       ``(2) Payments and revenues.--(A) The Secretary shall 
     establish royalties, fees, rentals, bonuses, or other 
     payments to ensure a fair return to the United States for any 
     lease, easement, or right-of-way granted under this 
     subsection.
       ``(B) The Secretary shall provide for the payment of 27 
     percent of the revenues received by the Federal Government as 
     a result of payments under this section from projects that 
     are located wholly or partially within the area extending 
     three nautical miles seaward of State submerged lands. 
     Payments shall be made based on a formula established by the 
     Secretary by rulemaking no later than 180 days after the date 
     of enactment of this section that provides for equitable 
     distribution, based on proximity to the project, among 
     coastal states that have a coastline that is located within 
     15 miles of the geographic center of the project.
       ``(3) Competitive or noncompetitive basis.--Except with 
     respect to projects that meet the criteria established under 
     section 388(d) of the Energy Policy Act of 2005, the 
     Secretary shall issue a lease, easement, or right-of-way 
     under paragraph (1) on a competitive basis unless the 
     Secretary determines after public notice of a proposed lease, 
     easement, or right-of-way that there is no competitive 
     interest.
       ``(4) Requirements.--The Secretary shall ensure that any 
     activity under this subsection is carried out in a manner 
     that provides for--
       ``(A) safety;
       ``(B) protection of the environment;
       ``(C) prevention of waste;
       ``(D) conservation of the natural resources of the outer 
     Continental Shelf;
       ``(E) coordination with relevant Federal agencies;
       ``(F) protection of national security interests of the 
     United States;
       ``(G) protection of correlative rights in the outer 
     Continental Shelf;
       ``(H) a fair return to the United States for any lease, 
     easement, or right-of-way under this subsection;
       ``(I) prevention of interference with reasonable uses (as 
     determined by the Secretary) of the exclusive economic zone, 
     the high seas, and the territorial seas;
       ``(J) consideration of--
       ``(i) the location of, and any schedule relating to, a 
     lease, easement, or right-of-way for an area of the outer 
     Continental Shelf; and
       ``(ii) any other use of the sea or seabed, including use 
     for a fishery, a sealane, a potential site of a deepwater 
     port, or navigation;
       ``(K) public notice and comment on any proposal submitted 
     for a lease, easement, or right-of-way under this subsection; 
     and
       ``(L) oversight, inspection, research, monitoring, and 
     enforcement relating to a lease, easement, or right-of-way 
     under this subsection.
       ``(5) Lease duration, suspension, and cancellation.--The 
     Secretary shall provide for the duration, issuance, transfer, 
     renewal, suspension, and cancellation of a lease, easement, 
     or right-of-way under this subsection.
       ``(6) Security.--The Secretary shall require the holder of 
     a lease, easement, or right-of-way granted under this 
     subsection to--
       ``(A) furnish a surety bond or other form of security, as 
     prescribed by the Secretary;
       ``(B) comply with such other requirements as the Secretary 
     considers necessary to protect the interests of the public 
     and the United States; and
       ``(C) provide for the restoration of the lease, easement, 
     or right-of-way.
       ``(7) Coordination and consultation with affected state and 
     local governments.--The Secretary shall provide for 
     coordination and consultation with the Governor of any State 
     or the executive of any local government that may be affected 
     by a lease, easement, or right-of-way under this subsection.
       ``(8) Regulations.--Not later than 270 days after the date 
     of enactment of the Energy Policy Act of 2005, the Secretary, 
     in consultation with the Secretary of Defense, the Secretary 
     of the Department in which the Coast Guard is operating, the 
     Secretary of Commerce, heads of other relevant departments 
     and agencies of the Federal Government, and the Governor of 
     any affected State, shall issue any necessary regulations to 
     carry out this subsection.
       ``(9) Effect of subsection.--Nothing in this subsection 
     displaces, supersedes, limits, or modifies the jurisdiction, 
     responsibility, or authority of any Federal or State agency 
     under any other Federal law.
       ``(10) Applicability.--This subsection does not apply to 
     any area on the outer Continental Shelf within the exterior 
     boundaries of any unit of the National Park System, National 
     Wildlife Refuge System, or National Marine Sanctuary System, 
     or any National Monument.''.
       (b) Coordinated OCS Mapping Initiative.--
       (1) In general.--The Secretary of the Interior, in 
     cooperation with the Secretary of Commerce, the Commandant of 
     the Coast Guard, and the Secretary of Defense, shall 
     establish an interagency comprehensive digital mapping 
     initiative for the outer Continental Shelf to assist in 
     decisionmaking relating to the siting of activities under 
     subsection (p) of section 8 of the Outer Continental Shelf 
     Lands Act (43 U.S.C. 1337) (as added by subsection (a)).
       (2) Use of data.--The mapping initiative shall use, and 
     develop procedures for accessing, data collected before the 
     date on which the mapping initiative is established, to the 
     maximum extent practicable.
       (3) Inclusions.--Mapping carried out under the mapping 
     initiative shall include an indication of the locations on 
     the outer Continental Shelf of--
       (A) Federally-permitted activities;
       (B) obstructions to navigation;
       (C) submerged cultural resources;
       (D) undersea cables;
       (E) offshore aquaculture projects; and
       (F) any area designated for the purpose of safety, national 
     security, environmental protection, or conservation and 
     management of living marine resources.
       (c) Conforming Amendment.--Section 8 of the Outer 
     Continental Shelf Lands Act (43 U.S.C. 1337) is amended by 
     striking the section heading and inserting the following: 
     ``Leases, Easements, and Rights-of-way on the Outer 
     Continental Shelf.--''.
       (d) Savings Provision.--Nothing in the amendment made by 
     subsection (a) requires the resubmittal of any document that 
     was previously submitted or the reauthorization of any action 
     that was previously authorized with respect to a project for 
     which, before the date of enactment of this Act--
       (1) an offshore test facility has been constructed; or
       (2) a request for a proposal has been issued by a public 
     authority.
       (e) State Claims to Jurisdiction Over Submerged Lands.--
     Nothing in this section shall be construed to alter, limit, 
     or modify any claim of any State to any jurisdiction over, or 
     any right, title, or interest in, any submerged lands.

     SEC. 389. OIL SPILL RECOVERY INSTITUTE.

       Title V of the Oil Pollution Act of 1990 (33 U.S.C. 2731 et 
     seq.) is amended--
       (1) in section 5001(i), by striking ``September 30, 2012'' 
     and inserting ``1 year after the date on which the Secretary, 
     in consultation with the Secretary of the Interior, 
     determines that oil and gas exploration, development, and 
     production in the State of Alaska have ceased''; and
       (2) in section 5006(c), by striking ``October 1, 2012'' and 
     inserting ``1 year after the date on which the Secretary, in 
     consultation with the Secretary of the Interior, determines 
     that oil and gas exploration, development, and production in 
     the State of Alaska have ceased,''.

     SEC. 390. NEPA REVIEW.

       (a) NEPA Review.--Action by the Secretary of the Interior 
     in managing the public lands, or the Secretary of Agriculture 
     in managing National Forest System Lands, with respect to any 
     of the activities described in subsection (b) shall be 
     subject to a rebuttable presumption that the use of a 
     categorical exclusion under the National Environmental Policy 
     Act of 1969 (NEPA) would apply if the activity is conducted 
     pursuant to the Mineral Leasing Act for the purpose of 
     exploration or development of oil or gas.
       (b) Activities Described.--The activities referred to in 
     subsection (a) are the following:
       (1) Individual surface disturbances of less than five (5) 
     acres so long as the total surface disturbance on the lease 
     is not greater than 150 acres and site-specific analysis in a 
     document prepared pursuant to NEPA has been previously 
     completed.
       (2) Drilling an oil or gas well at a location or well pad 
     site at which drilling has occurred previously within five 
     (5) years prior to the date of spudding the well.
       (3) Drilling an oil or gas well within a developed field 
     for which an approved land use plan or any environmental 
     document prepared pursuant to NEPA analyzed such drilling as 
     a reasonably foreseeable activity, so long as such plan or 
     document was approved within five (5) years prior to the date 
     of spudding the well.
       (4) Placement of a pipeline in an approved right-of-way 
     corridor, so long as the corridor was approved within five 
     (5) years prior to the date of placement of the pipeline.
       (5) Maintenance of a minor activity, other than any 
     construction or major renovation or a building or facility.
                  Subtitle H--Refinery Revitalization

     SEC. 391. FINDINGS AND DEFINITIONS.

       (a) Findings.--Congress finds that--
       (1) it serves the national interest to increase petroleum 
     refining capacity for gasoline, heating oil, diesel fuel, jet 
     fuel, kerosene, and petrochemical feedstocks wherever located 
     within the United States, to bring more supply to the markets 
     for the use of the American people;
       (2) United States demand for refined petroleum products 
     currently exceeds the country's petroleum refining capacity 
     to produce such products;
       (3) this excess demand has been met with increased imports;
       (4) due to lack of capacity, refined petroleum product 
     imports are expected to grow from 7.9

[[Page 17837]]

     percent to 10.7 percent of total refined product by 2025;
       (5) refiners are still subject to significant environmental 
     and other regulations and face several new requirements under 
     the Clean Air Act (42 U.S.C. 7401 et seq.) over the next 
     decade; and
       (6) better coordination of Federal and State regulatory 
     reviews may help facilitate siting and construction of new 
     refineries to meet the demand in the United States for 
     refined products.
       (b) Definitions.--In this subtitle:
       (1) Administrator.--The term ``Administrator'' means the 
     Administrator of the Environmental Protection Agency.
       (2) State.--The term ``State'' means--
       (A) a State;
       (B) the Commonwealth of Puerto Rico; and
       (C) any other territory or possession of the United States.

     SEC. 392. FEDERAL-STATE REGULATORY COORDINATION AND 
                   ASSISTANCE.

       (a) In General.--At the request of the Governor of a State, 
     the Administrator may enter into a refinery permitting 
     cooperative agreement with the State, under which each party 
     to the agreement identifies steps, including timelines, that 
     it will take to streamline the consideration of Federal and 
     State environmental permits for a new refinery.
       (b) Authority Under Agreement.--The Administrator shall be 
     authorized to--
       (1) accept from a refiner a consolidated application for 
     all permits required from the Environmental Protection 
     Agency, to the extent consistent with other applicable law;
       (2) enter into memoranda of agreement with other Federal 
     agencies to coordinate consideration of refinery applications 
     and permits among Federal agencies; and
       (3) enter into memoranda of agreement with a State, under 
     which Federal and State review of refinery permit 
     applications will be coordinated and concurrently considered, 
     to the extent practicable.
       (c) State Assistance.--The Administrator is authorized to 
     provide financial assistance to State governments to 
     facilitate the hiring of additional personnel with expertise 
     in fields relevant to consideration of refinery permits.
       (d) Other Assistance.--The Administrator is authorized to 
     provide technical, legal, or other assistance to State 
     governments to facilitate their review of applications to 
     build new refineries.
                             TITLE IV--COAL
                Subtitle A--Clean Coal Power Initiative

     SEC. 401. AUTHORIZATION OF APPROPRIATIONS.

       (a) Clean Coal Power Initiative.--There are authorized to 
     be appropriated to the Secretary to carry out the activities 
     authorized by this subtitle $200,000,000 for each of fiscal 
     years 2006 through 2014, to remain available until expended.
       (b) Report.--The Secretary shall submit to Congress the 
     report required by this subsection not later than March 31, 
     2007. The report shall include, with respect to subsection 
     (a), a plan containing--
       (1) a detailed assessment of whether the aggregate funding 
     levels provided under subsection (a) are the appropriate 
     funding levels for that program;
       (2) a detailed description of how proposals will be 
     solicited and evaluated, including a list of all activities 
     expected to be undertaken;
       (3) a detailed list of technical milestones for each coal 
     and related technology that will be pursued; and
       (4) a detailed description of how the program will avoid 
     problems enumerated in Government Accountability Office 
     reports on the Clean Coal Technology Program, including 
     problems that have resulted in unspent funds and projects 
     that failed either financially or scientifically.

     SEC. 402. PROJECT CRITERIA.

       (a) In General.--To be eligible to receive assistance under 
     this subtitle, a project shall advance efficiency, 
     environmental performance, and cost competitiveness well 
     beyond the level of technologies that are in commercial 
     service or have been demonstrated on a scale that the 
     Secretary determines is sufficient to demonstrate that 
     commercial service is viable as of the date of enactment of 
     this Act.
       (b) Technical Criteria for Clean Coal Power Initiative.--
       (1) Gasification projects.--
       (A) In general.--In allocating the funds made available 
     under section 401(a), the Secretary shall ensure that at 
     least 70 percent of the funds are used only to fund projects 
     on coal-based gasification technologies, including--
       (i) gasification combined cycle;
       (ii) gasification fuel cells and turbine combined cycle;
       (iii) gasification coproduction;
       (iv) hybrid gasification and combustion; and
       (v) other advanced coal based technologies capable of 
     producing a concentrated stream of carbon dioxide.
       (B) Technical milestones.--
       (i) Periodic determination.--

       (I) In general.--The Secretary shall periodically set 
     technical milestones specifying the emission and thermal 
     efficiency levels that coal gasification projects under this 
     subtitle shall be designed, and reasonably expected, to 
     achieve.
       (II) Prescriptive milestones.--The technical milestones 
     shall become more prescriptive during the period of the clean 
     coal power initiative.

       (ii) 2020 goals.--The Secretary shall establish the 
     periodic milestones so as to achieve by the year 2020 coal 
     gasification projects able--

       (I) to remove at least 99 percent of sulfur dioxide;
       (II) to emit not more than .05 lbs of NOx per 
     million Btu;
       (III) to achieve at least 95 percent reductions in mercury 
     emissions; and
       (IV) to achieve a thermal efficiency of at least--

       (aa) 50 percent for coal of more than 9,000 Btu;
       (bb) 48 percent for coal of 7,000 to 9,000 Btu; and
       (cc) 46 percent for coal of less than 7,000 Btu.
       (2) Other projects.--
       (A) Allocation of funds.--The Secretary shall ensure that 
     up to 30 percent of the funds made available under section 
     401(a) are used to fund projects other than those described 
     in paragraph (1).
       (B) Technical milestones.--
       (i) Periodic determination.--

       (I) In general.--The Secretary shall periodically establish 
     technical milestones specifying the emission and thermal 
     efficiency levels that projects funded under this paragraph 
     shall be designed, and reasonably expected, to achieve.
       (II) Prescriptive milestones.--The technical milestones 
     shall become more prescriptive during the period of the clean 
     coal power initiative.

       (ii) 2020 goals.--The Secretary shall set the periodic 
     milestones so as to achieve by the year 2020 projects able--

       (I) to remove at least 97 percent of sulfur dioxide;
       (II) to emit no more than .08 lbs of NOx per 
     million Btu;
       (III) to achieve at least 90 percent reductions in mercury 
     emissions; and
       (IV) to achieve a thermal efficiency of at least--

       (aa) 43 percent for coal of more than 9,000 Btu;
       (bb) 41 percent for coal of 7,000 to 9,000 Btu; and
       (cc) 39 percent for coal of less than 7,000 Btu.
       (3) Consultation.--Before setting the technical milestones 
     under paragraphs (1)(B) and (2)(B), the Secretary shall 
     consult with--
       (A) the Administrator of the Environmental Protection 
     Agency; and
       (B) interested entities, including--
       (i) coal producers;
       (ii) industries using coal;
       (iii) organizations that promote coal or advanced coal 
     technologies;
       (iv) environmental organizations;
       (v) organizations representing workers; and
       (vi) organizations representing consumers.
       (4) Existing units.--In the case of projects at units in 
     existence on the date of enactment of this Act, in lieu of 
     the thermal efficiency requirements described in paragraphs 
     (1)(B)(ii)(IV) and (2)(B)(ii)(IV), the milestones shall be 
     designed to achieve an overall thermal design efficiency 
     improvement, compared to the efficiency of the unit as 
     operated, of not less than--
       (A) 7 percent for coal of more than 9,000 Btu;
       (B) 6 percent for coal of 7,000 to 9,000 Btu; or
       (C) 4 percent for coal of less than 7,000 Btu.
       (5) Administration.--
       (A) Elevation of site.--In evaluating project proposals to 
     achieve thermal efficiency levels established under 
     paragraphs (1)(B)(i) and (2)(B)(i) and in determining 
     progress towards thermal efficiency milestones under 
     paragraphs (1)(B)(ii)(IV), (2)(B)(ii)(IV), and (4), the 
     Secretary shall take into account and make adjustments for 
     the elevation of the site at which a project is proposed to 
     be constructed.
       (B) Applicability of milestones.--In applying the thermal 
     efficiency milestones under paragraphs (1)(B)(ii)(IV), 
     (2)(B)(ii)(IV), and (4) to projects that separate and capture 
     at least 50 percent of the potential emissions of carbon 
     dioxide by a facility, the energy used for separation and 
     capture of carbon dioxide shall not be counted in calculating 
     the thermal efficiency.
       (C) Permitted uses.--In carrying out this section, the 
     Secretary may give priority to projects that include, as part 
     of the project--
       (i) the separation or capture of carbon dioxide; or
       (ii) the reduction of the demand for natural gas if 
     deployed.
       (c) Financial Criteria.--The Secretary shall not provide 
     financial assistance under this subtitle for a project unless 
     the recipient documents to the satisfaction of the Secretary 
     that--
       (1) the recipient is financially responsible;
       (2) the recipient will provide sufficient information to 
     the Secretary to enable the Secretary to ensure that the 
     funds are spent efficiently and effectively; and
       (3) a market exists for the technology being demonstrated 
     or applied, as evidenced by statements of interest in writing 
     from potential purchasers of the technology.
       (d) Financial Assistance.--The Secretary shall provide 
     financial assistance to projects that, as determined by the 
     Secretary--
       (1) meet the requirements of subsections (a), (b), and (c); 
     and
       (2) are likely--
       (A) to achieve overall cost reductions in the use of coal 
     to generate useful forms of energy or chemical feedstocks;
       (B) to improve the competitiveness of coal among various 
     forms of energy in order to maintain a diversity of fuel 
     choices in the United States to meet electricity generation 
     requirements; and
       (C) to demonstrate methods and equipment that are 
     applicable to 25 percent of the electricity generating 
     facilities, using various types of coal, that use coal as the 
     primary feedstock as of the date of enactment of this Act.
       (e) Cost-Sharing.--In carrying out this subtitle, the 
     Secretary shall require cost sharing in accordance with 
     section 988.

[[Page 17838]]

       (f) Scheduled Completion of Selected Projects.--
       (1) In general.--In selecting a project for financial 
     assistance under this section, the Secretary shall establish 
     a reasonable period of time during which the owner or 
     operator of the project shall complete the construction or 
     demonstration phase of the project, as the Secretary 
     determines to be appropriate.
       (2) Condition of financial assistance.--The Secretary shall 
     require as a condition of receipt of any financial assistance 
     under this subtitle that the recipient of the assistance 
     enter into an agreement with the Secretary not to request an 
     extension of the time period established for the project by 
     the Secretary under paragraph (1).
       (3) Extension of time period.--
       (A) In general.--Subject to subparagraph (B), the Secretary 
     may extend the time period established under paragraph (1) if 
     the Secretary determines, in the sole discretion of the 
     Secretary, that the owner or operator of the project cannot 
     complete the construction or demonstration phase of the 
     project within the time period due to circumstances beyond 
     the control of the owner or operator.
       (B) Limitation.--The Secretary shall not extend a time 
     period under subparagraph (A) by more than 4 years.
       (g) Fee Title.--The Secretary may vest fee title or other 
     property interests acquired under cost-share clean coal power 
     initiative agreements under this subtitle in any entity, 
     including the United States.
       (h) Data Protection.--For a period not exceeding 5 years 
     after completion of the operations phase of a cooperative 
     agreement, the Secretary may provide appropriate protections 
     (including exemptions from subchapter II of chapter 5 of 
     title 5, United States Code) against the dissemination of 
     information that--
       (1) results from demonstration activities carried out under 
     the clean coal power initiative program; and
       (2) would be a trade secret or commercial or financial 
     information that is privileged or confidential if the 
     information had been obtained from and first produced by a 
     non-Federal party participating in a clean coal power 
     initiative project.
       (i) Applicability.--No technology, or level of emission 
     reduction, solely by reason of the use of the technology, or 
     the achievement of the emission reduction, by 1 or more 
     facilities receiving assistance under this Act, shall be 
     considered to be--
       (1) adequately demonstrated for purposes of section 111 of 
     the Clean Air Act (42 U.S.C. 7411);
       (2) achievable for purposes of section 169 of that Act (42 
     U.S.C. 7479); or
       (3) achievable in practice for purposes of section 171 of 
     that Act (42 U.S.C. 7501).

     SEC. 403. REPORT.

       Not later than 1 year after the date of enactment of this 
     Act, and once every 2 years thereafter through 2014, the 
     Secretary, in consultation with other appropriate Federal 
     agencies, shall submit to Congress a report describing--
       (1) the technical milestones set forth in section 402 and 
     how those milestones ensure progress toward meeting the 
     requirements of subsections (b)(1)(B) and (b)(2) of section 
     402; and
       (2) the status of projects funded under this subtitle.

     SEC. 404. CLEAN COAL CENTERS OF EXCELLENCE.

       (a) In General.--As part of the clean coal power 
     initiative, the Secretary shall award competitive, merit-
     based grants to institutions of higher education for the 
     establishment of centers of excellence for energy systems of 
     the future.
       (b) Basis for Grants.--The Secretary shall award grants 
     under this section to institutions of higher education that 
     show the greatest potential for advancing new clean coal 
     technologies.
                    Subtitle B--Clean Power Projects

     SEC. 411. INTEGRATED COAL/RENEWABLE ENERGY SYSTEM.

       (a) In General.--Subject to the availability of 
     appropriations, the Secretary may provide loan guarantees for 
     a project to produce energy from coal of less than 7,000 Btu/
     lb using appropriate advanced integrated gasification 
     combined cycle technology, including repowering of existing 
     facilities, that--
       (1) is combined with wind and other renewable sources;
       (2) minimizes and offers the potential to sequester carbon 
     dioxide emissions; and
       (3) provides a ready source of hydrogen for near-site fuel 
     cell demonstrations.
       (b) Requirements.--The facility--
       (1) may be built in stages;
       (2) shall have a combined output of at least 200 megawatts 
     at successively more competitive rates; and
       (3) shall be located in the Upper Great Plains.
       (c) Technical Criteria.--Technical criteria described in 
     section 402(b) shall apply to the facility.
       (d) Investment Tax Credits.--
       (1) In general.--The loan guarantees provided under this 
     section do not preclude the facility from receiving an 
     allocation for investment tax credits under section 48A of 
     the Internal Revenue Code of 1986.
       (2) Other funding.--Use of the investment tax credit 
     described in paragraph (1) does not prohibit the use of other 
     clean coal program funding.

     SEC. 412. LOAN TO PLACE ALASKA CLEAN COAL TECHNOLOGY FACILITY 
                   IN SERVICE.

       (a) Definitions.--In this section:
       (1) Borrower.--The term ``borrower'' means the owner of the 
     clean coal technology plant.
       (2) Clean coal technology plant.--The term ``clean coal 
     technology plant'' means the plant located near Healy, 
     Alaska, constructed under Department cooperative agreement 
     number DE-FC-22-91PC90544.
       (3) Cost of a direct loan.--The term ``cost of a direct 
     loan'' has the meaning given the term in section 502(5)(B) of 
     the Federal Credit Reform Act of 1990 (2 U.S.C. 661a(5)(B)).
       (b) Authorization.--Subject to subsection (c), the 
     Secretary shall use amounts made available under subsection 
     (e) to provide the cost of a direct loan to the borrower for 
     purposes of placing the clean coal technology plant into 
     reliable operation for the generation of electricity.
       (c) Requirements.--
       (1) Maximum loan amount.--The amount of the direct loan 
     provided under subsection (b) shall not exceed $80,000,000.
       (2) Determinations by secretary.--Before providing the 
     direct loan to the borrower under subsection (b), the 
     Secretary shall determine that--
       (A) the plan of the borrower for placing the clean coal 
     technology plant in reliable operation has a reasonable 
     prospect of success;
       (B) the amount of the loan (when combined with amounts 
     available to the borrower from other sources) will be 
     sufficient to carry out the project; and
       (C) there is a reasonable prospect that the borrower will 
     repay the principal and interest on the loan.
       (3) Interest; term.--The direct loan provided under 
     subsection (b) shall bear interest at a rate and for a term 
     that the Secretary determines appropriate, after consultation 
     with the Secretary of the Treasury, taking into account the 
     needs and capacities of the borrower and the prevailing rate 
     of interest for similar loans made by public and private 
     lenders.
       (4) Additional terms and conditions.--The Secretary may 
     require any other terms and conditions that the Secretary 
     determines to be appropriate.
       (d) Use of Payments.--The Secretary shall retain any 
     payments of principal and interest on the direct loan 
     provided under subsection (b) to support energy research and 
     development activities, to remain available until expended, 
     subject to any other conditions in an applicable 
     appropriations Act.
       (e) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to provide the 
     cost of a direct loan under subsection (b).

     SEC. 413. WESTERN INTEGRATED COAL GASIFICATION DEMONSTRATION 
                   PROJECT.

       (a) In General.--Subject to the availability of 
     appropriations, the Secretary shall carry out a project to 
     demonstrate production of energy from coal mined in the 
     western United States using integrated gasification combined 
     cycle technology (referred to in this section as the 
     ``demonstration project'').
       (b) Components.--The demonstration project--
       (1) may include repowering of existing facilities;
       (2) shall be designed to demonstrate the ability to use 
     coal with an energy content of not more than 9,000 Btu/lb.; 
     and
       (3) shall be capable of removing and sequestering carbon 
     dioxide emissions.
       (c) All Types of Western Coals.--Notwithstanding the 
     foregoing, and to the extent economically feasible, the 
     demonstration project shall also be designed to demonstrate 
     the ability to use a variety of types of coal (including 
     subbituminous and bituminous coal with an energy content of 
     up to 13,000 Btu/lb.) mined in the western United States.
       (d) Location.--The demonstration project shall be located 
     in a western State at an altitude of greater than 4,000 feet 
     above sea level.
       (e) Cost Sharing.--The Federal share of the cost of the 
     demonstration project shall be determined in accordance with 
     section 988.
       (f) Loan Guarantees.--Notwithstanding title XIV, the 
     demonstration project shall not be eligible for Federal loan 
     guarantees.

     SEC. 414. COAL GASIFICATION.

       The Secretary is authorized to provide loan guarantees for 
     a project to produce energy from a plant using integrated 
     gasification combined cycle technology of at least 400 
     megawatts in capacity that produces power at competitive 
     rates in deregulated energy generation markets and that does 
     not receive any subsidy (direct or indirect) from ratepayers.

     SEC. 415. PETROLEUM COKE GASIFICATION.

       The Secretary is authorized to provide loan guarantees for 
     at least 5 petroleum coke gasification projects.

     SEC. 416. ELECTRON SCRUBBING DEMONSTRATION.

       The Secretary shall use $5,000,000 from amounts 
     appropriated to initiate, through the Chicago Operations 
     Office, a project to demonstrate the viability of high-energy 
     electron scrubbing technology on commercial-scale electrical 
     generation using high-sulfur coal.

     SEC. 417. DEPARTMENT OF ENERGY TRANSPORTATION FUELS FROM 
                   ILLINOIS BASIN COAL.

       (a) In General.--The Secretary shall carry out a program to 
     evaluate the commercial and technical viability of advanced 
     technologies for the production of Fischer-Tropsch 
     transportation fuels, and other transportation fuels, 
     manufactured from Illinois basin coal, including the capital 
     modification of existing facilities and the construction of 
     testing facilities under subsection (b).
       (b) Facilities.--For the purpose of evaluating the 
     commercial and technical viability of different processes for 
     producing Fischer-Tropsch

[[Page 17839]]

     transportation fuels, and other transportation fuels, from 
     Illinois basin coal, the Secretary shall support the use and 
     capital modification of existing facilities and the 
     construction of new facilities at--
       (1) Southern Illinois University Coal Research Center;
       (2) University of Kentucky Center for Applied Energy 
     Research; and
       (3) Energy Center at Purdue University.
       (c) Gasification Products Test Center.--In conjunction with 
     the activities described in subsections (a) and (b), the 
     Secretary shall construct a test center to evaluate and 
     confirm liquid and gas products from syngas catalysis in 
     order that the system has an output of at least 500 gallons 
     of Fischer-Tropsch transportation fuel per day in a 24-hour 
     operation.
       (d) Milestones.--
       (1) Selection of processes.--Not later than 180 days after 
     the date of enactment of this Act, the Secretary shall select 
     processes for evaluating the commercial and technical 
     viability of different processes of producing Fischer-Tropsch 
     transportation fuels, and other transportation fuels, from 
     Illinois basin coal.
       (2) Agreements.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary shall offer to enter 
     into agreements--
       (A) to carry out the activities described in this section, 
     at the facilities described in subsection (b); and
       (B) for the capital modifications or construction of the 
     facilities at the locations described in subsection (b).
       (3) Evaluations.--Not later than 3 years after the date of 
     enactment of the Act, the Secretary shall begin, at the 
     facilities described in subsection (b), evaluation of the 
     technical and commercial viability of different processes of 
     producing Fischer-Tropsch transportation fuels, and other 
     transportation fuels, from Illinois basin coal.
       (4) Construction of facilities.--
       (A) In general.--The Secretary shall construct the 
     facilities described in subsection (b) at the lowest cost 
     practicable.
       (B) Grants or agreements.--The Secretary may make grants or 
     enter into agreements or contracts with the institutions of 
     higher education described in subsection (b).
       (e) Cost Sharing.--The cost of making grants under this 
     section shall be shared in accordance with section 988.
       (f) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $85,000,000 for 
     the period of fiscal years 2006 through 2010.
                 Subtitle C--Coal and Related Programs

     SEC. 421. AMENDMENT OF THE ENERGY POLICY ACT OF 1992.

       (a) Amendment.--The Energy Policy Act of 1992 (42 U.S.C. 
     13201 et seq.) is amended by adding at the end the following:
                  ``TITLE XXXI--CLEAN AIR COAL PROGRAM

     ``SEC. 3101. PURPOSES.

       ``The purposes of this title are to--
       ``(1) promote national energy policy and energy security, 
     diversity, and economic competitiveness benefits that result 
     from the increased use of coal;
       ``(2) mitigate financial risks, reduce the cost of clean 
     coal generation, and increase the marketplace acceptance of 
     clean coal generation and pollution control equipment and 
     processes; and
       ``(3) facilitate the environmental performance of clean 
     coal generation.

     ``SEC. 3102. AUTHORIZATION OF PROGRAM.

       ``(a) In General.--The Secretary shall carry out a program 
     of financial assistance to--
       ``(1) facilitate the production and generation of coal-
     based power, through the deployment of clean coal electric 
     generating equipment and processes that, compared to 
     equipment or processes that are in operation on a full 
     scale--
       ``(A) improve--
       ``(i) energy efficiency; or
       ``(ii) environmental performance consistent with relevant 
     Federal and State clean air requirements, including those 
     promulgated under the Clean Air Act (42 U.S.C. 7401 et seq.); 
     and
       ``(B) are not yet cost competitive; and
       ``(2) facilitate the utilization of existing coal-based 
     electricity generation plants through projects that--
       ``(A) deploy advanced air pollution control equipment and 
     processes; and
       ``(B) are designed to voluntarily enhance environmental 
     performance above current applicable obligations under the 
     Clean Air Act and State implementation efforts pursuant to 
     such Act.
       ``(b) Financial Criteria.--As determined by the Secretary 
     for a particular project, financial assistance under this 
     title shall be in the form of--
       ``(1) cost-sharing of an appropriate percentage of the 
     total project cost, not to exceed 50 percent as calculated 
     under section 988 of the Energy Policy Act of 2005; or
       ``(2) financial assistance, including grants, cooperative 
     agreements, or loans as authorized under this Act or other 
     statutory authority of the Secretary.

     ``SEC. 3103. GENERATION PROJECTS.

       ``(a) Eligible Projects.--Projects supported under section 
     3102(a)(1) may include--
       ``(1) equipment or processes previously supported by a 
     Department of Energy program;
       ``(2) advanced combustion equipment and processes that the 
     Secretary determines will be cost-effective and could 
     substantially contribute to meeting environmental or energy 
     needs, including gasification, gasification fuel cells, 
     gasification coproduction, oxidation combustion techniques, 
     ultra-supercritical boilers, and chemical looping; and
       ``(3) hybrid gasification/combustion systems, including 
     systems integrating fuel cells with gasification or 
     combustion units.
       ``(b) Criteria.--The Secretary shall establish criteria for 
     the selection of generation projects under section 
     3102(a)(1). The Secretary may modify the criteria as 
     appropriate to reflect improvements in equipment, except that 
     the criteria shall not be modified to be less stringent. The 
     selection criteria shall include--
       ``(1) prioritization of projects whose installation is 
     likely to result in significant air quality improvements in 
     nonattainment air quality areas;
       ``(2) prioritization of projects whose installation is 
     likely to result in lower emission rates of pollution;
       ``(3) prioritization of projects that result in the 
     repowering or replacement of older, less efficient units;
       ``(4) documented broad interest in the procurement of the 
     equipment and utilization of the processes used in the 
     projects by owners or operators of facilities for electricity 
     generation;
       ``(5) equipment and processes beginning in 2006 through 
     2011 that are projected to achieve a thermal efficiency of--
       ``(A) 40 percent for coal of more than 9,000 Btu per pound 
     based on higher heating values;
       ``(B) 38 percent for coal of 7,000 to 9,000 Btu per pound 
     passed on higher heating values; and
       ``(C) 36 percent for coal of less than 7,000 Btu per pound 
     based on higher heating values;
     except that energy used for coproduction or cogeneration 
     shall not be counted in calculating the thermal efficiency 
     under this paragraph; and
       ``(6) equipment and processes beginning in 2012 and 2013 
     that are projected to achieve a thermal efficiency of--
       ``(A) 45 percent for coal of more than 9,000 Btu per pound 
     based on higher heating values;
       ``(B) 44 percent for coal of 7,000 to 9,000 Btu per pound 
     passed on higher heating values; and
       ``(C) 40 percent for coal of less than 7,000 Btu per pound 
     based on higher heating values;
     except that energy used for coproduction or cogeneration 
     shall not be counted in calculating the thermal efficiency 
     under this paragraph
       ``(c) Program Balance and Priority.--In carrying out the 
     program under section 3102(a)(1), the Secretary shall ensure, 
     to the extent practicable, that--
       ``(1) between 25 percent and 75 percent of the projects 
     supported are for the sole purpose of electrical generation; 
     and
       ``(2) priority is given to projects that use electrical 
     generation equipment and processes that have been developed 
     and demonstrated and applied in actual production of 
     electricity, but are not yet cost-competitive, and that 
     achieve greater efficiency and environmental performance.
       ``(d) Authorization of Appropriations.--There are 
     authorized to be appropriated to the Secretary to carry out 
     section 3102(a)(1)--
       ``(1) $250,000,000 for fiscal year 2007;
       ``(2) $350,000,000 for fiscal year 2008;
       ``(3) $400,000,000 for each of fiscal years 2009 through 
     2012; and
       ``(4) $300,000,000 for fiscal year 2013.
       ``(e) Applicability.--No technology, or level of emission 
     reduction shall be treated as adequately demonstrated for 
     purpose of section 111 of the Clean Air Act (42 U.S.C. 7411), 
     achievable for purposes of section 169 of that Act (42 U.S.C. 
     7479), or achievable in practice for purposes of section 171 
     of that Act (42 U.S.C. 7501) solely by reason of the use of 
     such technology, or the achievement of such emission 
     reduction, by 1 or more facilities receiving assistance under 
     section 3102(a)(1).

     ``SEC. 3104. AIR QUALITY ENHANCEMENT PROGRAM.

       ``(a) Eligible Projects.--Projects supported under section 
     3102(a)(2) shall--
       ``(1) utilize technologies that meet relevant Federal and 
     State clean air requirements applicable to the unit or 
     facility, including being adequately demonstrated for 
     purposes of section 111 of the Clean Air Act (42 U.S.C. 
     7411), achievable for purposes of section 169 of that Act (42 
     U.S.C. 7479), or achievable in practice for purposes of 
     section 171 of that Act (42 U.S.C. 7501); or
       ``(2) utilize equipment or processes that exceed relevant 
     Federal or State clean air requirements applicable to the 
     unit or facilities included in the projects by achieving 
     greater efficiency or environmental performance.
       ``(b) Priority in Project Selection.--In making an award 
     under section 3102(a)(2), the Secretary shall give priority 
     to--
       ``(1) projects whose installation is likely to result in 
     significant air quality improvements in nonattainment air 
     quality areas or substantially reduce the emission level of 
     criteria pollutants and mercury air emissions;
       ``(2) projects for pollution control that result in the 
     mitigation or collection of more than 1 pollutant; and
       ``(3) projects designed to allow the use of the waste 
     byproducts or other byproducts of the equipment.
       ``(c) Authorization of Appropriations.--There are 
     authorized to be appropriated to the Secretary to carry out 
     section 3102(a)(2)--
       ``(1) $300,000,000 for fiscal year 2007;
       ``(2) $100,000,000 for fiscal year 2008;
       ``(3) $40,000,000 for fiscal year 2009;
       ``(4) $30,000,000 for fiscal year 2010; and
       ``(5) $30,000,000 for fiscal year 2011.
       ``(d) Applicability.--No technology, or level of emission 
     reduction under subsection (a)(2) shall be treated as 
     adequately demonstrated for

[[Page 17840]]

     purpose of Section 111 of the Clean Air Act (42 U.S.C. 7411), 
     achievable for purposes of section 169 of that Act (42 U.S.C. 
     7479), or achievable in practice for purposes of section 171 
     of that Act (42 U.S.C. 7501) solely by reason of the use of 
     such technology, or the achievement of such emission 
     reduction, by 1 or more facilities receiving assistance under 
     section 3102(a)(2).''.
       (b) Table of Contents Amendment.--The table of contents of 
     the Energy Policy Act of 1992 (42 U.S.C. prec. 13201) is 
     amended by adding at the end the following:

                  ``TITLE XXXI--CLEAN AIR COAL PROGRAM

``Sec. 3101. Purposes.
``Sec. 3102. Authorization of program.
``Sec. 3103. Generation projects.
``Sec. 3104. Air quality enhancement program.''.
                    Subtitle D--Federal Coal Leases

     SEC. 431. SHORT TITLE.

       This subtitle may be cited as the ``Coal Leasing Amendments 
     Act of 2005''.

     SEC. 432. REPEAL OF THE 160-ACRE LIMITATION FOR COAL LEASES.

       Section 3 of the Mineral Leasing Act (30 U.S.C. 203) is 
     amended--
       (1) in the first sentence, by striking ``Any person'' and 
     inserting the following: ``(a)(1) Except as provided in 
     paragraph (3), on a finding by the Secretary under paragraph 
     (2), any person'';
       (2) in the second sentence, by striking ``The Secretary'' 
     and inserting the following:
       ``(b) The Secretary'';
       (3) in the third sentence, by striking ``The minimum'' and 
     inserting the following:
       ``(c) The minimum'';
       (4) in subsection (a) (as designated by paragraph (1))--
       (A) by striking ``upon'' and all that follows and inserting 
     the following: ``secure modifications of the original coal 
     lease by including additional coal lands or coal deposits 
     contiguous or cornering to those embraced in the lease.''; 
     and
       (B) by adding at the end the following:
       ``(2) A finding referred to in paragraph (1) is a finding 
     by the Secretary that the modifications--
       ``(A) would be in the interest of the United States;
       ``(B) would not displace a competitive interest in the 
     lands; and
       ``(C) would not include lands or deposits that can be 
     developed as part of another potential or existing operation.
       ``(3) In no case shall the total area added by 
     modifications to an existing coal lease under paragraph (1)--
       ``(A) exceed 960 acres; or
       ``(B) add acreage larger than that in the original 
     lease.''.

     SEC. 433. APPROVAL OF LOGICAL MINING UNITS.

       Section 2(d)(2) of the Mineral Leasing Act (30 U.S.C. 
     202a(2)) is amended--
       (1) by inserting ``(A)'' after ``(2)''; and
       (2) by adding at the end the following:
       ``(B) The Secretary may establish a period of more than 40 
     years if the Secretary determines that the longer period--
       ``(i) will ensure the maximum economic recovery of a coal 
     deposit; or
       ``(ii) the longer period is in the interest of the orderly, 
     efficient, or economic development of a coal resource.''.

     SEC. 434. PAYMENT OF ADVANCE ROYALTIES UNDER COAL LEASES.

       Section 7(b) of the Mineral Leasing Act (30 U.S.C. 207(b)) 
     is amended--
       (1) in the first sentence, by striking ``Each lease'' and 
     inserting the following: ``(1) Each lease'';
       (2) in the second sentence, by striking ``The Secretary'' 
     and inserting the following:
       ``(2) The Secretary'';
       (3) in the third sentence, by striking ``Such advance 
     royalties'' and inserting the following:
       ``(3) Advance royalties described in paragraph (2)'';
       (4) in the seventh sentence, by striking ``The Secretary'' 
     and inserting the following:
       ``(6) The Secretary'';
       (5) in the last sentence, by striking ``Nothing'' and 
     inserting the following:
       ``(7) Nothing'';
       (6) by striking the fourth, fifth, and sixth sentences; and
       (7) by inserting after paragraph (3) (as designated by 
     paragraph (3)) the following:
       ``(4) Advance royalties described in paragraph (2) shall be 
     computed--
       ``(A) based on--
       ``(i) the average price in the spot market for sales of 
     comparable coal from the same region during the last month of 
     each applicable continued operation year; or
       ``(ii) in the absence of a spot market for comparable coal 
     from the same region, by using a comparable method 
     established by the Secretary of the Interior to capture the 
     commercial value of coal; and
       ``(B) based on commercial quantities, as defined by 
     regulation by the Secretary of the Interior.
       ``(5) The aggregate number of years during the period of 
     any lease for which advance royalties may be accepted in lieu 
     of the condition of continued operation shall not exceed 20 
     years.
       ``(6) The amount of any production royalty paid for any 
     year shall be reduced (but not below 0) by the amount of any 
     advance royalties paid under a lease described in paragraph 
     (5) to the extent that the advance royalties have not been 
     used to reduce production royalties for a prior year.''.

     SEC. 435. ELIMINATION OF DEADLINE FOR SUBMISSION OF COAL 
                   LEASE OPERATION AND RECLAMATION PLAN.

       Section 7(c) of the Mineral Leasing Act (30 U.S.C. 207(c)) 
     is amended by striking ``and not later than three years after 
     a lease is issued,''.

     SEC. 436. AMENDMENT RELATING TO FINANCIAL ASSURANCES WITH 
                   RESPECT TO BONUS BIDS.

       Section 2(a) of the Mineral Leasing Act (30 U.S.C. 201(a)) 
     is amended by adding at the end the following:
       ``(4)(A) The Secretary shall not require a surety bond or 
     any other financial assurance to guarantee payment of 
     deferred bonus bid installments with respect to any coal 
     lease issued on a cash bonus bid to a lessee or successor in 
     interest having a history of a timely payment of noncontested 
     coal royalties and advanced coal royalties in lieu of 
     production (where applicable) and bonus bid installment 
     payments.
       ``(B) The Secretary may waive any requirement that a lessee 
     provide a surety bond or other financial assurance to 
     guarantee payment of deferred bonus bid installment with 
     respect to any coal lease issued before the date of the 
     enactment of the Energy Policy Act of 2005 only if the 
     Secretary determines that the lessee has a history of making 
     timely payments referred to in subparagraph (A).
       ``(5) Notwithstanding any other provision of law, if the 
     lessee under a coal lease fails to pay any installment of a 
     deferred cash bonus bid within 10 days after the Secretary 
     provides written notice that payment of the installment is 
     past due--
       ``(A) the lease shall automatically terminate; and
       ``(B) any bonus payments already made to the United States 
     with respect to the lease shall not be returned to the lessee 
     or credited in any future lease sale.''.

     SEC. 437. INVENTORY REQUIREMENT.

       (a) Review of Assessments.--
       (1) In general.--The Secretary of the Interior, in 
     consultation with the Secretary of Agriculture and the 
     Secretary, shall review coal assessments and other available 
     data to identify--
       (A) Federal lands with coal resources that are available 
     for development;
       (B) the extent and nature of any restrictions on the 
     development of coal resources on Federal lands identified 
     under paragraph (1); and
       (C) with respect to areas of such lands for which 
     sufficient data exists, resources of compliant coal and 
     supercompliant coal.
       (2) Definitions.--For purposes of this subsection--
       (A) the term ``compliant coal'' means coal that contains 
     not less than 1.0 and not more than 1.2 pounds of sulfur 
     dioxide per million Btu; and
       (B) the term ``supercompliant coal'' means coal that 
     contains less than 1.0 pounds of sulfur dioxide per million 
     Btu.
       (b) Completion and Updating of the Inventory.--The 
     Secretary--
       (1) shall complete the inventory under subsection (a) by 
     not later than 2 years after the date of enactment of this 
     Act; and
       (2) shall update the inventory as the availability of data 
     and developments in technology warrant.
       (c) Report.--The Secretary shall submit to the Committee on 
     Resources of the House of Representatives and to the 
     Committee on Energy and Natural Resources of the Senate and 
     make publicly available--
       (1) a report containing the inventory under this section, 
     by not later than 2 years after the effective date of this 
     section; and
       (2) each update of such inventory.

     SEC. 438. APPLICATION OF AMENDMENTS.

       The amendments made by this subtitle apply with respect to 
     any coal lease issued before, on, or after the date of the 
     enactment of this Act.
                         TITLE V--INDIAN ENERGY

     SEC. 501. SHORT TITLE.

       This title may be cited as the ``Indian Tribal Energy 
     Development and Self-Determination Act of 2005''.

     SEC. 502. OFFICE OF INDIAN ENERGY POLICY AND PROGRAMS.

       (a) In General.--Title II of the Department of Energy 
     Organization Act (42 U.S.C. 7131 et seq.) is amended by 
     adding at the end the following:


             ``OFFICE OF INDIAN ENERGY POLICY AND PROGRAMS

       ``Sec. 217. (a) Establishment.--There is established within 
     the Department an Office of Indian Energy Policy and Programs 
     (referred to in this section as the `Office'). The Office 
     shall be headed by a Director, who shall be appointed by the 
     Secretary and compensated at a rate equal to that of level IV 
     of the Executive Schedule under section 5315 of title 5, 
     United States Code.
       ``(b) Duties of Director.--The Director, in accordance with 
     Federal policies promoting Indian self-determination and the 
     purposes of this Act, shall provide, direct, foster, 
     coordinate, and implement energy planning, education, 
     management, conservation, and delivery programs of the 
     Department that--
       ``(1) promote Indian tribal energy development, efficiency, 
     and use;
       ``(2) reduce or stabilize energy costs;
       ``(3) enhance and strengthen Indian tribal energy and 
     economic infrastructure relating to natural resource 
     development and electrification; and
       ``(4) bring electrical power and service to Indian land and 
     the homes of tribal members located on Indian lands or 
     acquired, constructed, or improved (in whole or in part) with 
     Federal funds.''.
       (b) Conforming Amendments.--
       (1) The table of contents of the Department of Energy 
     Organization Act (42 U.S.C. prec. 7101) is amended--

[[Page 17841]]

       (A) in the item relating to section 209, by striking 
     ``Section'' and inserting ``Sec.''; and
       (B) by striking the items relating to sections 213 through 
     216 and inserting the following:

``Sec. 213. Establishment of policy for National Nuclear Security 
              Administration
``Sec. 214. Establishment of security, counterintelligence, and 
              intelligence policies
``Sec. 215. Office of Counterintelligence
``Sec. 216. Office of Intelligence
``Sec. 217. Office of Indian Energy Policy and Programs''.

       (2) Section 5315 of title 5, United States Code, is amended 
     by inserting after the item related to the Inspector General, 
     Department of Energy the following new item:
       ``Director, Office of Indian Energy Policy and Programs, 
     Department of Energy.''.

     SEC. 503. INDIAN ENERGY.

       (a) In General.--Title XXVI of the Energy Policy Act of 
     1992 (25 U.S.C. 3501 et seq.) is amended to read as follows:
                      ``TITLE XXVI--INDIAN ENERGY

     ``SEC. 2601. DEFINITIONS.

       ``In this title:
       ``(1) The term `Director' means the Director of the Office 
     of Indian Energy Policy and Programs, Department of Energy.
       ``(2) The term `Indian land' means--
       ``(A) any land located within the boundaries of an Indian 
     reservation, pueblo, or rancheria;
       ``(B) any land not located within the boundaries of an 
     Indian reservation, pueblo, or rancheria, the title to which 
     is held--
       ``(i) in trust by the United States for the benefit of an 
     Indian tribe or an individual Indian;
       ``(ii) by an Indian tribe or an individual Indian, subject 
     to restriction against alienation under laws of the United 
     States; or
       ``(iii) by a dependent Indian community; and
       ``(C) land that is owned by an Indian tribe and was 
     conveyed by the United States to a Native Corporation 
     pursuant to the Alaska Native Claims Settlement Act (43 
     U.S.C. 1601 et seq.), or that was conveyed by the United 
     States to a Native Corporation in exchange for such land.
       ``(3) The term `Indian reservation' includes--
       ``(A) an Indian reservation in existence in any State or 
     States as of the date of enactment of this paragraph;
       ``(B) a public domain Indian allotment; and
       ``(C) a dependent Indian community located within the 
     borders of the United States, regardless of whether the 
     community is located--
       ``(i) on original or acquired territory of the community; 
     or
       ``(ii) within or outside the boundaries of any State or 
     States.
       ``(4)(A) The term `Indian tribe' has the meaning given the 
     term in section 4 of the Indian Self-Determination and 
     Education Assistance Act (25 U.S.C. 450b).
       ``(B) For the purpose of paragraph (12) and sections 
     2603(b)(1)(C) and 2604, the term `Indian tribe' does not 
     include any Native Corporation.
       ``(5) The term `integration of energy resources' means any 
     project or activity that promotes the location and operation 
     of a facility (including any pipeline, gathering system, 
     transportation system or facility, or electric transmission 
     or distribution facility) on or near Indian land to process, 
     refine, generate electricity from, or otherwise develop 
     energy resources on, Indian land.
       ``(6) The term `Native Corporation' has the meaning given 
     the term in section 3 of the Alaska Native Claims Settlement 
     Act (43 U.S.C. 1602).
       ``(7) The term `organization' means a partnership, joint 
     venture, limited liability company, or other unincorporated 
     association or entity that is established to develop Indian 
     energy resources.
       ``(8) The term `Program' means the Indian energy resource 
     development program established under section 2602(a).
       ``(9) The term `Secretary' means the Secretary of the 
     Interior.
       ``(10) The term `sequestration' means the long-term 
     separation, isolation, or removal of greenhouse gases from 
     the atmosphere, including through a biological or geologic 
     method such as reforestation or an underground reservoir.
       ``(11) The term `tribal energy resource development 
     organization' means an organization of 2 or more entities, at 
     least 1 of which is an Indian tribe, that has the written 
     consent of the governing bodies of all Indian tribes 
     participating in the organization to apply for a grant, loan, 
     or other assistance under section 2602.
       ``(12) The term `tribal land' means any land or interests 
     in land owned by any Indian tribe, title to which is held in 
     trust by the United States, or is subject to a restriction 
     against alienation under laws of the United States.

     ``SEC. 2602. INDIAN TRIBAL ENERGY RESOURCE DEVELOPMENT.

       ``(a) Department of the Interior Program.--
       ``(1) To assist Indian tribes in the development of energy 
     resources and further the goal of Indian self-determination, 
     the Secretary shall establish and implement an Indian energy 
     resource development program to assist consenting Indian 
     tribes and tribal energy resource development organizations 
     in achieving the purposes of this title.
       ``(2) In carrying out the Program, the Secretary shall--
       ``(A) provide development grants to Indian tribes and 
     tribal energy resource development organizations for use in 
     developing or obtaining the managerial and technical capacity 
     needed to develop energy resources on Indian land, and to 
     properly account for resulting energy production and 
     revenues;
       ``(B) provide grants to Indian tribes and tribal energy 
     resource development organizations for use in carrying out 
     projects to promote the integration of energy resources, and 
     to process, use, or develop those energy resources, on Indian 
     land;
       ``(C) provide low-interest loans to Indian tribes and 
     tribal energy resource development organizations for use in 
     the promotion of energy resource development on Indian land 
     and integration of energy resources; and
       ``(D) provide grants and technical assistance to an 
     appropriate tribal environmental organization, as determined 
     by the Secretary, that represents multiple Indian tribes to 
     establish a national resource center to develop tribal 
     capacity to establish and carry out tribal environmental 
     programs in support of energy-related programs and activities 
     under this title, including--
       ``(i) training programs for tribal environmental officials, 
     program managers, and other governmental representatives;
       ``(ii) the development of model environmental policies and 
     tribal laws, including tribal environmental review codes, and 
     the creation and maintenance of a clearinghouse of best 
     environmental management practices; and
       ``(iii) recommended standards for reviewing the 
     implementation of tribal environmental laws and policies 
     within tribal judicial or other tribal appeals systems.
       ``(3) There are authorized to be appropriated to carry out 
     this subsection such sums as are necessary for each of fiscal 
     years 2006 through 2016.
       ``(b) Department of Energy Indian Energy Education Planning 
     and Management Assistance Program.--
       ``(1) The Director shall establish programs to assist 
     consenting Indian tribes in meeting energy education, 
     research and development, planning, and management needs.
       ``(2) In carrying out this subsection, the Director may 
     provide grants, on a competitive basis, to an Indian tribe or 
     tribal energy resource development organization for use in 
     carrying out--
       ``(A) energy, energy efficiency, and energy conservation 
     programs;
       ``(B) studies and other activities supporting tribal 
     acquisitions of energy supplies, services, and facilities, 
     including the creation of tribal utilities to assist in 
     securing electricity to promote electrification of homes and 
     businesses on Indian land;
       ``(C) planning, construction, development, operation, 
     maintenance, and improvement of tribal electrical generation, 
     transmission, and distribution facilities located on Indian 
     land; and
       ``(D) development, construction, and interconnection of 
     electric power transmission facilities located on Indian land 
     with other electric transmission facilities.
       ``(3)(A) The Director shall develop a program to support 
     and implement research projects that provide Indian tribes 
     with opportunities to participate in carbon sequestration 
     practices on Indian land, including--
       ``(i) geologic sequestration;
       ``(ii) forest sequestration;
       ``(iii) agricultural sequestration; and
       ``(iv) any other sequestration opportunities the Director 
     considers to be appropriate.
       ``(B) The activities carried out under subparagraph (A) 
     shall be--
       ``(i) coordinated with other carbon sequestration research 
     and development programs conducted by the Secretary of 
     Energy;
       ``(ii) conducted to determine methods consistent with 
     existing standardized measurement protocols to account and 
     report the quantity of carbon dioxide or other greenhouse 
     gases sequestered in projects that may be implemented on 
     Indian land; and
       ``(iii) reviewed periodically to collect and distribute to 
     Indian tribes information on carbon sequestration practices 
     that will increase the sequestration of carbon without 
     threatening the social and economic well-being of Indian 
     tribes.
       ``(4)(A) The Director, in consultation with Indian tribes, 
     may develop a formula for providing grants under this 
     subsection.
       ``(B) In providing a grant under this subsection, the 
     Director shall give priority to any application received from 
     an Indian tribe with inadequate electric service (as 
     determined by the Director).
       ``(C) In providing a grant under this subsection for an 
     activity to provide, or expand the provision of, electricity 
     on Indian land, the Director shall encourage cooperative 
     arrangements between Indian tribes and utilities that provide 
     service to Indian tribes, as the Director determines to be 
     appropriate.
       ``(5) The Secretary of Energy may issue such regulations as 
     the Secretary determines to be necessary to carry out this 
     subsection.
       ``(6) There is authorized to be appropriated to carry out 
     this subsection $20,000,000 for each of fiscal years 2006 
     through 2016.
       ``(c) Department of Energy Loan Guarantee Program.--
       ``(1) Subject to paragraphs (2) and (4), the Secretary of 
     Energy may provide loan guarantees (as defined in section 502 
     of the Federal Credit Reform Act of 1990 (2 U.S.C. 661a)) for 
     an amount equal to not more than 90 percent of the unpaid 
     principal and interest due on any loan made to an Indian 
     tribe for energy development.
       ``(2) In providing a loan guarantee under this subsection 
     for an activity to provide, or expand the provision of, 
     electricity on Indian land, the Secretary of Energy shall 
     encourage cooperative arrangements between Indian tribes and 
     utilities that provide service to Indian tribes, as the 
     Secretary determines to be appropriate.

[[Page 17842]]

       ``(3) A loan guarantee under this subsection shall be made 
     by--
       ``(A) a financial institution subject to examination by the 
     Secretary of Energy; or
       ``(B) an Indian tribe, from funds of the Indian tribe.
       ``(4) The aggregate outstanding amount guaranteed by the 
     Secretary of Energy at any time under this subsection shall 
     not exceed $2,000,000,000.
       ``(5) The Secretary of Energy may issue such regulations as 
     the Secretary of Energy determines are necessary to carry out 
     this subsection.
       ``(6) There are authorized to be appropriated such sums as 
     are necessary to carry out this subsection, to remain 
     available until expended.
       ``(7) Not later than 1 year after the date of enactment of 
     this section, the Secretary of Energy shall submit to 
     Congress a report on the financing requirements of Indian 
     tribes for energy development on Indian land.
       ``(d) Preference.--
       ``(1) In purchasing electricity or any other energy product 
     or byproduct, a Federal agency or department may give 
     preference to an energy and resource production enterprise, 
     partnership, consortium, corporation, or other type of 
     business organization the majority of the interest in which 
     is owned and controlled by 1 or more Indian tribes.
       ``(2) In carrying out this subsection, a Federal agency or 
     department shall not--
       ``(A) pay more than the prevailing market price for an 
     energy product or byproduct; or
       ``(B) obtain less than prevailing market terms and 
     conditions.

     ``SEC. 2603. INDIAN TRIBAL ENERGY RESOURCE REGULATION.

       ``(a) Grants.--The Secretary may provide to Indian tribes, 
     on an annual basis, grants for use in accordance with 
     subsection (b).
       ``(b) Use of Funds.--Funds from a grant provided under this 
     section may be used--
       ``(1)(A) by an Indian tribe for the development of a tribal 
     energy resource inventory or tribal energy resource on Indian 
     land;
       ``(B) by an Indian tribe for the development of a 
     feasibility study or other report necessary to the 
     development of energy resources on Indian land;
       ``(C) by an Indian tribe (other than an Indian Tribe in the 
     State of Alaska, except the Metlakatla Indian Community) 
     for--
       ``(i) the development and enforcement of tribal laws 
     (including regulations) relating to tribal energy resource 
     development; and
       ``(ii) the development of technical infrastructure to 
     protect the environment under applicable law; or
       ``(D) by a Native Corporation for the development and 
     implementation of corporate policies and the development of 
     technical infrastructure to protect the environment under 
     applicable law; and
       ``(2) by an Indian tribe for the training of employees 
     that--
       ``(A) are engaged in the development of energy resources on 
     Indian land; or
       ``(B) are responsible for protecting the environment.
       ``(c) Other Assistance.--
       ``(1) In carrying out the obligations of the United States 
     under this title, the Secretary shall ensure, to the maximum 
     extent practicable and to the extent of available resources, 
     that on the request of an Indian tribe, the Indian tribe 
     shall have available scientific and technical information and 
     expertise, for use in the regulation, development, and 
     management of energy resources of the Indian tribe on Indian 
     land.
       ``(2) The Secretary may carry out paragraph (1)--
       ``(A) directly, through the use of Federal officials; or
       ``(B) indirectly, by providing financial assistance to an 
     Indian tribe to secure independent assistance.

     ``SEC. 2604. LEASES, BUSINESS AGREEMENTS, AND RIGHTS-OF-WAY 
                   INVOLVING ENERGY DEVELOPMENT OR TRANSMISSION.

       ``(a) Leases and Business Agreements.--In accordance with 
     this section--
       ``(1) an Indian tribe may, at the discretion of the Indian 
     tribe, enter into a lease or business agreement for the 
     purpose of energy resource development on tribal land, 
     including a lease or business agreement for--
       ``(A) exploration for, extraction of, processing of, or 
     other development of the energy mineral resources of the 
     Indian tribe located on tribal land; or
       ``(B) construction or operation of--
       ``(i) an electric generation, transmission, or distribution 
     facility located on tribal land; or
       ``(ii) a facility to process or refine energy resources 
     developed on tribal land; and
       ``(2) a lease or business agreement described in paragraph 
     (1) shall not require review by or the approval of the 
     Secretary under section 2103 of the Revised Statutes (25 
     U.S.C. 81), or any other provision of law, if--
       ``(A) the lease or business agreement is executed pursuant 
     to a tribal energy resource agreement approved by the 
     Secretary under subsection (e);
       ``(B) the term of the lease or business agreement does not 
     exceed--
       ``(i) 30 years; or
       ``(ii) in the case of a lease for the production of oil 
     resources, gas resources, or both, 10 years and as long 
     thereafter as oil or gas is produced in paying quantities; 
     and
       ``(C) the Indian tribe has entered into a tribal energy 
     resource agreement with the Secretary, as described in 
     subsection (e), relating to the development of energy 
     resources on tribal land (including the periodic review and 
     evaluation of the activities of the Indian tribe under the 
     agreement, to be conducted pursuant to subsection 
     (e)(2)(D)(i)).
       ``(b) Rights-of-Way for Pipelines or Electric Transmission 
     or Distribution Lines.--An Indian tribe may grant a right-of-
     way over tribal land for a pipeline or an electric 
     transmission or distribution line without review or approval 
     by the Secretary if--
       ``(1) the right-of-way is executed in accordance with a 
     tribal energy resource agreement approved by the Secretary 
     under subsection (e);
       ``(2) the term of the right-of-way does not exceed 30 
     years;
       ``(3) the pipeline or electric transmission or distribution 
     line serves--
       ``(A) an electric generation, transmission, or distribution 
     facility located on tribal land; or
       ``(B) a facility located on tribal land that processes or 
     refines energy resources developed on tribal land; and
       ``(4) the Indian tribe has entered into a tribal energy 
     resource agreement with the Secretary, as described in 
     subsection (e), relating to the development of energy 
     resources on tribal land (including the periodic review and 
     evaluation of the activities of the Indian tribe under an 
     agreement described in subparagraphs (D) and (E) of 
     subsection (e)(2)).
       ``(c) Renewals.--A lease or business agreement entered 
     into, or a right-of-way granted, by an Indian tribe under 
     this section may be renewed at the discretion of the Indian 
     tribe in accordance with this section.
       ``(d) Validity.--No lease, business agreement, or right-of-
     way relating to the development of tribal energy resources 
     under this section shall be valid unless the lease, business 
     agreement, or right-of-way is authorized by a tribal energy 
     resource agreement approved by the Secretary under subsection 
     (e)(2).
       ``(e) Tribal Energy Resource Agreements.--
       ``(1) On the date on which regulations are promulgated 
     under paragraph (8), an Indian tribe may submit to the 
     Secretary for approval a tribal energy resource agreement 
     governing leases, business agreements, and rights-of-way 
     under this section.
       ``(2)(A) Not later than 270 days after the date on which 
     the Secretary receives a tribal energy resource agreement 
     from an Indian tribe under paragraph (1), or not later than 
     60 days after the Secretary receives a revised tribal energy 
     resource agreement from an Indian tribe under paragraph 
     (4)(C) (or a later date, as agreed to by the Secretary and 
     the Indian tribe), the Secretary shall approve or disapprove 
     the tribal energy resource agreement.
       ``(B) The Secretary shall approve a tribal energy resource 
     agreement submitted under paragraph (1) if--
       ``(i) the Secretary determines that the Indian tribe has 
     demonstrated that the Indian tribe has sufficient capacity to 
     regulate the development of energy resources of the Indian 
     tribe;
       ``(ii) the tribal energy resource agreement includes 
     provisions required under subparagraph (D); and
       ``(iii) the tribal energy resource agreement includes 
     provisions that, with respect to a lease, business agreement, 
     or right-of-way under this section--
       ``(I) ensure the acquisition of necessary information from 
     the applicant for the lease, business agreement, or right-of-
     way;
       ``(II) address the term of the lease or business agreement 
     or the term of conveyance of the right-of-way;
       ``(III) address amendments and renewals;
       ``(IV) address the economic return to the Indian tribe 
     under leases, business agreements, and rights-of-way;
       ``(V) address technical or other relevant requirements;
       ``(VI) establish requirements for environmental review in 
     accordance with subparagraph (C);
       ``(VII) ensure compliance with all applicable environmental 
     laws, including a requirement that each lease, business 
     agreement, and right-of-way state that the lessee, operator, 
     or right-of-way grantee shall comply with all such laws;
       ``(VIII) identify final approval authority;
       ``(IX) provide for public notification of final approvals;
       ``(X) establish a process for consultation with any 
     affected States regarding off-reservation impacts, if any, 
     identified under subparagraph (C)(i);
       ``(XI) describe the remedies for breach of the lease, 
     business agreement, or right-of-way;
       ``(XII) require each lease, business agreement, and right-
     of-way to include a statement that, if any of its provisions 
     violates an express term or requirement of the tribal energy 
     resource agreement pursuant to which the lease, business 
     agreement, or right-of-way was executed--

       ``(aa) the provision shall be null and void; and
       ``(bb) if the Secretary determines the provision to be 
     material, the Secretary may suspend or rescind the lease, 
     business agreement, or right-of-way or take other appropriate 
     action that the Secretary determines to be in the best 
     interest of the Indian tribe;

       ``(XIII) require each lease, business agreement, and right-
     of-way to provide that it will become effective on the date 
     on which a copy of the executed lease, business agreement, or 
     right-of-way is delivered to the Secretary in accordance with 
     regulations promulgated under paragraph (8);
       ``(XIV) include citations to tribal laws, regulations, or 
     procedures, if any, that set out tribal

[[Page 17843]]

     remedies that must be exhausted before a petition may be 
     submitted to the Secretary under paragraph (7)(B);
       ``(XV) specify the financial assistance, if any, to be 
     provided by the Secretary to the Indian tribe to assist in 
     implementation of the tribal energy resource agreement, 
     including environmental review of individual projects; and
       ``(XVI) in accordance with the regulations promulgated by 
     the Secretary under paragraph (8), require that the Indian 
     tribe, as soon as practicable after receipt of a notice by 
     the Indian tribe, give written notice to the Secretary of--

       ``(aa) any breach or other violation by another party of 
     any provision in a lease, business agreement, or right-of-way 
     entered into under the tribal energy resource agreement; and
       ``(bb) any activity or occurrence under a lease, business 
     agreement, or right-of-way that constitutes a violation of 
     Federal or tribal environmental laws.

       ``(C) Tribal energy resource agreements submitted under 
     paragraph (1) shall establish, and include provisions to 
     ensure compliance with, an environmental review process that, 
     with respect to a lease, business agreement, or right-of-way 
     under this section, provides for, at a minimum--
       ``(i) the identification and evaluation of all significant 
     environmental effects (as compared to a no-action 
     alternative), including effects on cultural resources;
       ``(ii) the identification of proposed mitigation measures, 
     if any, and incorporation of appropriate mitigation measures 
     into the lease, business agreement, or right-of-way;
       ``(iii) a process for ensuring that--

       ``(I) the public is informed of, and has an opportunity to 
     comment on, the environmental impacts of the proposed action; 
     and
       ``(II) responses to relevant and substantive comments are 
     provided, before tribal approval of the lease, business 
     agreement, or right-of-way;

       ``(iv) sufficient administrative support and technical 
     capability to carry out the environmental review process; and
       ``(v) oversight by the Indian tribe of energy development 
     activities by any other party under any lease, business 
     agreement, or right-of-way entered into pursuant to the 
     tribal energy resource agreement, to determine whether the 
     activities are in compliance with the tribal energy resource 
     agreement and applicable Federal environmental laws.
       ``(D) A tribal energy resource agreement between the 
     Secretary and an Indian tribe under this subsection shall 
     include--
       ``(i) provisions requiring the Secretary to conduct a 
     periodic review and evaluation to monitor the performance of 
     the activities of the Indian tribe associated with the 
     development of energy resources under the tribal energy 
     resource agreement; and
       ``(ii) if a periodic review and evaluation, or an 
     investigation, by the Secretary of any breach or violation 
     described in a notice provided by the Indian tribe to the 
     Secretary in accordance with subparagraph (B)(iii)(XVI), 
     results in a finding by the Secretary of imminent jeopardy to 
     a physical trust asset arising from a violation of the tribal 
     energy resource agreement or applicable Federal laws, 
     provisions authorizing the Secretary to take actions 
     determined by the Secretary to be necessary to protect the 
     asset, including reassumption of responsibility for 
     activities associated with the development of energy 
     resources on tribal land until the violation and any 
     condition that caused the jeopardy are corrected.
       ``(E) Periodic review and evaluation under subparagraph (D) 
     shall be conducted on an annual basis, except that, after the 
     third annual review and evaluation, the Secretary and the 
     Indian tribe may mutually agree to amend the tribal energy 
     resource agreement to authorize the review and evaluation 
     under subparagraph (D) to be conducted once every 2 years.
       ``(3) The Secretary shall provide notice and opportunity 
     for public comment on tribal energy resource agreements 
     submitted for approval under paragraph (1). The Secretary's 
     review of a tribal energy resource agreement shall be limited 
     to activities specified by the provisions of the tribal 
     energy resource agreement.
       ``(4) If the Secretary disapproves a tribal energy resource 
     agreement submitted by an Indian tribe under paragraph (1), 
     the Secretary shall, not later than 10 days after the date of 
     disapproval--
       ``(A) notify the Indian tribe in writing of the basis for 
     the disapproval;
       ``(B) identify what changes or other actions are required 
     to address the concerns of the Secretary; and
       ``(C) provide the Indian tribe with an opportunity to 
     revise and resubmit the tribal energy resource agreement.
       ``(5) If an Indian tribe executes a lease or business 
     agreement, or grants a right-of-way, in accordance with a 
     tribal energy resource agreement approved under this 
     subsection, the Indian tribe shall, in accordance with the 
     process and requirements under regulations promulgated under 
     paragraph (8), provide to the Secretary--
       ``(A) a copy of the lease, business agreement, or right-of-
     way document (including all amendments to and renewals of the 
     document); and
       ``(B) in the case of a tribal energy resource agreement or 
     a lease, business agreement, or right-of-way that permits 
     payments to be made directly to the Indian tribe, information 
     and documentation of those payments sufficient to enable the 
     Secretary to discharge the trust responsibility of the United 
     States to enforce the terms of, and protect the rights of the 
     Indian tribe under, the lease, business agreement, or right-
     of-way.
       ``(6)(A) In carrying out this section, the Secretary 
     shall--
       ``(i) act in accordance with the trust responsibility of 
     the United States relating to mineral and other trust 
     resources; and
       ``(ii) act in good faith and in the best interests of the 
     Indian tribes.
       ``(B) Subject to the provisions of subsections (a)(2), (b), 
     and (c) waiving the requirement of Secretarial approval of 
     leases, business agreements, and rights-of-way executed 
     pursuant to tribal energy resource agreements approved under 
     this section, and the provisions of subparagraph (D), nothing 
     in this section shall absolve the United States from any 
     responsibility to Indians or Indian tribes, including, but 
     not limited to, those which derive from the trust 
     relationship or from any treaties, statutes, and other laws 
     of the United States, Executive Orders, or agreements between 
     the United States and any Indian tribe.
       ``(C) The Secretary shall continue to fulfill the trust 
     obligation of the United States to ensure that the rights and 
     interests of an Indian tribe are protected if--
       ``(i) any other party to a lease, business agreement, or 
     right-of-way violates any applicable Federal law or the terms 
     of any lease, business agreement, or right-of-way under this 
     section; or
       ``(ii) any provision in a lease, business agreement, or 
     right-of-way violates the tribal energy resource agreement 
     pursuant to which the lease, business agreement, or right-of-
     way was executed.
       ``(D)(i) In this subparagraph, the term `negotiated term' 
     means any term or provision that is negotiated by an Indian 
     tribe and any other party to a lease, business agreement, or 
     right-of-way entered into pursuant to an approved tribal 
     energy resource agreement.
       ``(ii) Notwithstanding subparagraph (B), the United States 
     shall not be liable to any party (including any Indian tribe) 
     for any negotiated term of, or any loss resulting from the 
     negotiated terms of, a lease, business agreement, or right-
     of-way executed pursuant to and in accordance with a tribal 
     energy resource agreement approved by the Secretary under 
     paragraph (2).
       ``(7)(A) In this paragraph, the term `interested party' 
     means any person (including an entity) that has demonstrated 
     that an interest of the person has sustained, or will 
     sustain, an adverse environmental impact as a result of the 
     failure of an Indian tribe to comply with a tribal energy 
     resource agreement of the Indian tribe approved by the 
     Secretary under paragraph (2).
       ``(B) After exhaustion of any tribal remedy, and in 
     accordance with regulations promulgated by the Secretary 
     under paragraph (8), an interested party may submit to the 
     Secretary a petition to review the compliance by an Indian 
     tribe with a tribal energy resource agreement of the Indian 
     tribe approved by the Secretary under paragraph (2).
       ``(C)(i) Not later than 20 days after the date on which the 
     Secretary receives a petition under subparagraph (B), the 
     Secretary shall--
       ``(I) provide to the Indian tribe a copy of the petition; 
     and
       ``(II) consult with the Indian tribe regarding any 
     noncompliance alleged in the petition.
       ``(ii) Not later than 45 days after the date on which a 
     consultation under clause (i)(II) takes place, the Indian 
     tribe shall respond to any claim made in a petition under 
     subparagraph (B).
       ``(iii) The Secretary shall act in accordance with 
     subparagraphs (D) and (E) only if the Indian tribe--
       ``(I) denies, or fails to respond to, each claim made in 
     the petition within the period described in clause (ii); or
       ``(II) fails, refuses, or is unable to cure or otherwise 
     resolve each claim made in the petition within a reasonable 
     period, as determined by the Secretary, after the expiration 
     of the period described in clause (ii).
       ``(D)(i) Not later than 120 days after the date on which 
     the Secretary receives a petition under subparagraph (B), the 
     Secretary shall determine whether the Indian tribe is not in 
     compliance with the tribal energy resource agreement.
       ``(ii) The Secretary may adopt procedures under paragraph 
     (8) authorizing an extension of time, not to exceed 120 days, 
     for making the determination under clause (i) in any case in 
     which the Secretary determines that additional time is 
     necessary to evaluate the allegations of the petition.
       ``(iii) Subject to subparagraph (E), if the Secretary 
     determines that the Indian tribe is not in compliance with 
     the tribal energy resource agreement, the Secretary shall 
     take such action as the Secretary determines to be necessary 
     to ensure compliance with the tribal energy resource 
     agreement, including--
       ``(I) temporarily suspending any activity under a lease, 
     business agreement, or right-of-way under this section until 
     the Indian tribe is in compliance with the approved tribal 
     energy resource agreement; or
       ``(II) rescinding approval of all or part of the tribal 
     energy resource agreement, and if all of the agreement is 
     rescinded, reassuming the responsibility for approval of any 
     future leases, business agreements, or rights-of-way 
     described in subsection (a) or (b).
       ``(E) Before taking an action described in subparagraph 
     (D)(iii), the Secretary shall--
       ``(i) make a written determination that describes the 
     manner in which the tribal energy resource agreement has been 
     violated;
       ``(ii) provide the Indian tribe with a written notice of 
     the violations together with the written determination; and

[[Page 17844]]

       ``(iii) before taking any action described in subparagraph 
     (D)(iii) or seeking any other remedy, provide the Indian 
     tribe with a hearing and a reasonable opportunity to attain 
     compliance with the tribal energy resource agreement.
       ``(F) An Indian tribe described in subparagraph (E) shall 
     retain all rights to appeal under any regulation promulgated 
     by the Secretary.
       ``(8) Not later than 1 year after the date of enactment of 
     the Energy Policy Act of 2005, the Secretary shall promulgate 
     regulations that implement this subsection, including--
       ``(A) criteria to be used in determining the capacity of an 
     Indian tribe under paragraph (2)(B)(i), including the 
     experience of the Indian tribe in managing natural resources 
     and financial and administrative resources available for use 
     by the Indian tribe in implementing the approved tribal 
     energy resource agreement of the Indian tribe;
       ``(B) a process and requirements in accordance with which 
     an Indian tribe may--
       ``(i) voluntarily rescind a tribal energy resource 
     agreement approved by the Secretary under this subsection; 
     and
       ``(ii) return to the Secretary the responsibility to 
     approve any future lease, business agreement, or right-of-way 
     under this subsection;
       ``(C) provisions establishing the scope of, and procedures 
     for, the periodic review and evaluation described in 
     subparagraphs (D) and (E) of paragraph (2), including 
     provisions for review of transactions, reports, site 
     inspections, and any other review activities the Secretary 
     determines to be appropriate; and
       ``(D) provisions describing final agency actions after 
     exhaustion of administrative appeals from determinations of 
     the Secretary under paragraph (7).
       ``(f) No Effect on Other Law.--Nothing in this section 
     affects the application of--
       ``(1) any Federal environmental law;
       ``(2) the Surface Mining Control and Reclamation Act of 
     1977 (30 U.S.C. 1201 et seq.); or
       ``(3) except as otherwise provided in this title, the 
     Indian Mineral Development Act of 1982 (25 U.S.C. 2101 et 
     seq.).
       ``(g) Authorization of Appropriations.--There are 
     authorized to be appropriated to the Secretary such sums as 
     are necessary for each of fiscal years 2006 through 2016 to 
     carry out this section and to make grants or provide other 
     appropriate assistance to Indian tribes to assist the Indian 
     tribes in developing and implementing tribal energy resource 
     agreements in accordance with this section.

     ``SEC. 2605. FEDERAL POWER MARKETING ADMINISTRATIONS.

       ``(a) Definitions.--In this section:
       ``(1) The term `Administrator' means the Administrator of 
     the Bonneville Power Administration and the Administrator of 
     the Western Area Power Administration.
       ``(2) The term `power marketing administration' means--
       ``(A) the Bonneville Power Administration;
       ``(B) the Western Area Power Administration; and
       ``(C) any other power administration the power allocation 
     of which is used by or for the benefit of an Indian tribe 
     located in the service area of the administration.
       ``(b) Encouragement of Indian Tribal Energy Development.--
     Each Administrator shall encourage Indian tribal energy 
     development by taking such actions as the Administrators 
     determine to be appropriate, including administration of 
     programs of the power marketing administration, in accordance 
     with this section.
       ``(c) Action by Administrators.--In carrying out this 
     section, in accordance with laws in existence on the date of 
     enactment of the Energy Policy Act of 2005--
       ``(1) each Administrator shall consider the unique 
     relationship that exists between the United States and Indian 
     tribes;
       ``(2) power allocations from the Western Area Power 
     Administration to Indian tribes may be used to meet firming 
     and reserve needs of Indian-owned energy projects on Indian 
     land;
       ``(3) the Administrator of the Western Area Power 
     Administration may purchase non-federally generated power 
     from Indian tribes to meet the firming and reserve 
     requirements of the Western Area Power Administration; and
       ``(4) each Administrator shall not--
       ``(A) pay more than the prevailing market price for an 
     energy product; or
       ``(B) obtain less than prevailing market terms and 
     conditions.
       ``(d) Assistance for Transmission System Use.--
       ``(1) An Administrator may provide technical assistance to 
     Indian tribes seeking to use the high-voltage transmission 
     system for delivery of electric power.
       ``(2) The costs of technical assistance provided under 
     paragraph (1) shall be funded--
       ``(A) by the Secretary of Energy using nonreimbursable 
     funds appropriated for that purpose; or
       ``(B) by any appropriate Indian tribe.
       ``(e) Power Allocation Study.--Not later than 2 years after 
     the date of enactment of the Energy Policy Act of 2005, the 
     Secretary of Energy shall submit to Congress a report that--
       ``(1) describes the use by Indian tribes of Federal power 
     allocations of the power marketing administration (or power 
     sold by the Southwestern Power Administration) to or for the 
     benefit of Indian tribes in a service area of the power 
     marketing administration; and
       ``(2) identifies--
       ``(A) the quantity of power allocated to, or used for the 
     benefit of, Indian tribes by the Western Area Power 
     Administration;
       ``(B) the quantity of power sold to Indian tribes by any 
     other power marketing administration; and
       ``(C) barriers that impede tribal access to and use of 
     Federal power, including an assessment of opportunities to 
     remove those barriers and improve the ability of power 
     marketing administrations to deliver Federal power.
       ``(f) Authorization of Appropriations.--There are 
     authorized to be appropriated to carry out this section 
     $750,000, non-reimbursable, to remain available until 
     expended.

     ``SEC. 2606. WIND AND HYDROPOWER FEASIBILITY STUDY.

       ``(a) Study.--The Secretary of Energy, in coordination with 
     the Secretary of the Army and the Secretary, shall conduct a 
     study of the cost and feasibility of developing a 
     demonstration project that uses wind energy generated by 
     Indian tribes and hydropower generated by the Army Corps of 
     Engineers on the Missouri River to supply firming power to 
     the Western Area Power Administration.
       ``(b) Scope of Study.--The study shall--
       ``(1) determine the economic and engineering feasibility of 
     blending wind energy and hydropower generated from the 
     Missouri River dams operated by the Army Corps of Engineers, 
     including an assessment of the costs and benefits of blending 
     wind energy and hydropower compared to current sources used 
     for firming power to the Western Area Power Administration;
       ``(2) review historical and projected requirements for, 
     patterns of availability and use of, and reasons for 
     historical patterns concerning the availability of firming 
     power;
       ``(3) assess the wind energy resource potential on tribal 
     land and projected cost savings through a blend of wind and 
     hydropower over a 30-year period;
       ``(4) determine seasonal capacity needs and associated 
     transmission upgrades for integration of tribal wind 
     generation and identify costs associated with these 
     activities;
       ``(5) include an independent tribal engineer and a Western 
     Area Power Administration customer representative as study 
     team members; and
       ``(6) incorporate, to the extent appropriate, the results 
     of the Dakotas Wind Transmission study prepared by the 
     Western Area Power Administration.
       ``(c) Report.--Not later than 1 year after the date of 
     enactment of the Energy Policy Act of 2005, the Secretary of 
     Energy, the Secretary and the Secretary of the Army shall 
     submit to Congress a report that describes the results of the 
     study, including--
       ``(1) an analysis and comparison of the potential energy 
     cost or benefits to the customers of the Western Area Power 
     Administration through the use of combined wind and 
     hydropower;
       ``(2) an economic and engineering evaluation of whether a 
     combined wind and hydropower system can reduce reservoir 
     fluctuation, enhance efficient and reliable energy 
     production, and provide Missouri River management 
     flexibility;
       ``(3) if found feasible, recommendations for a 
     demonstration project to be carried out by the Western Area 
     Power Administration, in partnership with an Indian tribal 
     government or tribal energy resource development 
     organization, and Western Area Power Administration customers 
     to demonstrate the feasibility and potential of using wind 
     energy produced on Indian land to supply firming energy to 
     the Western Area Power Administration; and
       ``(4) an identification of--
       ``(A) the economic and environmental costs of, or benefits 
     to be realized through, a Federal-tribal-customer 
     partnership; and
       ``(B) the manner in which a Federal-tribal-customer 
     partnership could contribute to the energy security of the 
     United States.
       ``(d) Funding.--
       ``(1) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this section $1,000,000, to 
     remain available until expended.
       ``(2) Nonreimbursability.--Costs incurred by the Secretary 
     in carrying out this section shall be nonreimbursable.''.
       (b) Conforming Amendments.--The table of contents for the 
     Energy Policy Act of 1992 is amended by striking the items 
     relating to title XXVI and inserting the following:

``Sec. 2601. Definitions.
``Sec. 2602. Indian tribal energy resource development.
``Sec. 2603. Indian tribal energy resource regulation.
``Sec. 2604. Leases, business agreements, and rights-of-way involving 
              energy development or transmission.
``Sec. 2605. Federal Power Marketing Administrations.
``Sec. 2606. Wind and hydropower feasibility study.''.

     SEC. 504. CONSULTATION WITH INDIAN TRIBES.

       In carrying out this title and the amendments made by this 
     title, the Secretary and the Secretary of the Interior shall, 
     as appropriate and to the maximum extent practicable, involve 
     and consult with Indian tribes.

     SEC. 505. FOUR CORNERS TRANSMISSION LINE PROJECT AND 
                   ELECTRIFICATION.

       (a) Transmission Line Project.--The Dine Power Authority, 
     an enterprise of the Navajo Nation, shall be eligible to 
     receive grants and other assistance under section 217 of the 
     Department of Energy Organization Act, as added by section 
     502, and section 2602 of the Energy Policy Act of 1992, as 
     amended by this Act, for activities associated with the 
     development of a transmission line from the Four Corners Area 
     to southern Nevada, including related power generation 
     opportunities.

[[Page 17845]]

       (b) Navajo Electrification.--Section 602 of Public Law 106-
     511 (114 Stat. 2376) is amended--
       (1) in subsection (a)--
       (A) in the first sentence, by striking ``5-year'' and 
     inserting ``10-year''; and
       (B) in the third sentence, by striking ``2006'' and 
     inserting ``2011''; and
       (2) in the first sentence of subsection (e) by striking 
     ``2006'' and inserting ``2011''.

     SEC. 506. ENERGY EFFICIENCY IN FEDERALLY ASSISTED HOUSING.

       (a) In General.--The Secretary of Housing and Urban 
     Development shall promote energy conservation in housing that 
     is located on Indian land and assisted with Federal resources 
     through--
       (1) the use of energy-efficient technologies and 
     innovations (including the procurement of energy-efficient 
     refrigerators and other appliances);
       (2) the promotion of shared savings contracts; and
       (3) the use and implementation of such other similar 
     technologies and innovations as the Secretary of Housing and 
     Urban Development considers to be appropriate.
       (b) Amendment.--Section 202(2) of the Native American 
     Housing and Self-Determination Act of 1996 (25 U.S.C. 
     4132(2)) is amended by inserting ``improvement to achieve 
     greater energy efficiency,'' after ``planning,''.
                       TITLE VI--NUCLEAR MATTERS
               Subtitle A--Price-Anderson Act Amendments

     SEC. 601. SHORT TITLE.

       This subtitle may be cited as the ``Price-Anderson 
     Amendments Act of 2005''.

     SEC. 602. EXTENSION OF INDEMNIFICATION AUTHORITY.

       (a) Indemnification of Nuclear Regulatory Commission 
     Licensees.--Section 170 c. of the Atomic Energy Act of 1954 
     (42 U.S.C. 2210(c)) is amended--
       (1) in the subsection heading, by striking ``Licenses'' and 
     inserting ``Licensees''; and
       (2) by striking ``December 31, 2003'' each place it appears 
     and inserting ``December 31, 2025''.
       (b) Indemnification of Department Contractors.--Section 170 
     d.(1)(A) of the Atomic Energy Act of 1954 (42 U.S.C. 
     2210(d)(1)(A)) is amended by striking ``December 31, 2006'' 
     and inserting ``December 31, 2025''.
       (c) Indemnification of Nonprofit Educational 
     Institutions.--Section 170 k. of the Atomic Energy Act of 
     1954 (42 U.S.C. 2210(k)) is amended by striking ``August 1, 
     2002'' each place it appears and inserting ``December 31, 
     2025''.

     SEC. 603. MAXIMUM ASSESSMENT.

       Section 170 of the Atomic Energy Act of 1954 (42 U.S.C. 
     2210) is amended--
       (1) in the second proviso of the third sentence of 
     subsection b.(1)--
       (A) by striking ``$63,000,000'' and inserting 
     ``$95,800,000''; and
       (B) by striking ``$10,000,000 in any 1 year'' and inserting 
     ``$15,000,000 in any 1 year (subject to adjustment for 
     inflation under subsection t.)''; and
       (2) in subsection t.(1)--
       (A) by inserting ``total and annual'' after ``amount of the 
     maximum'';
       (B) by striking ``the date of the enactment of the Price-
     Anderson Amendments Act of 1988'' and inserting ``August 20, 
     2003''; and
       (C) in subparagraph (A), by striking ``such date of 
     enactment'' and inserting ``August 20, 2003''.

     SEC. 604. DEPARTMENT LIABILITY LIMIT.

       (a) Indemnification of Department Contractors.--Section 170 
     d. of the Atomic Energy Act of 1954 (42 U.S.C. 2210(d)) is 
     amended by striking paragraph (2) and inserting the 
     following:
       ``(2) In an agreement of indemnification entered into under 
     paragraph (1), the Secretary--
       ``(A) may require the contractor to provide and maintain 
     financial protection of such a type and in such amounts as 
     the Secretary shall determine to be appropriate to cover 
     public liability arising out of or in connection with the 
     contractual activity; and
       ``(B) shall indemnify the persons indemnified against such 
     liability above the amount of the financial protection 
     required, in the amount of $10,000,000,000 (subject to 
     adjustment for inflation under subsection t.), in the 
     aggregate, for all persons indemnified in connection with the 
     contract and for each nuclear incident, including such legal 
     costs of the contractor as are approved by the Secretary.''.
       (b) Contract Amendments.--Section 170 d. of the Atomic 
     Energy Act of 1954 (42 U.S.C. 2210(d)) is further amended by 
     striking paragraph (3) and inserting the following--
       ``(3) All agreements of indemnification under which the 
     Department of Energy (or its predecessor agencies) may be 
     required to indemnify any person under this section shall be 
     deemed to be amended, on the date of enactment of the Price-
     Anderson Amendments Act of 2005, to reflect the amount of 
     indemnity for public liability and any applicable financial 
     protection required of the contractor under this 
     subsection.''.
       (c) Liability Limit.--Section 170 e.(1)(B) of the Atomic 
     Energy Act of 1954 (42 U.S.C. 2210(e)(1)(B)) is amended--
       (1) by striking ``the maximum amount of financial 
     protection required under subsection b. or''; and
       (2) by striking ``paragraph (3) of subsection d., whichever 
     amount is more'' and inserting ``paragraph (2) of subsection 
     d.''.

     SEC. 605. INCIDENTS OUTSIDE THE UNITED STATES.

       (a) Amount of Indemnification.--Section 170 d.(5) of the 
     Atomic Energy Act of 1954 (42 U.S.C. 2210(d)(5)) is amended 
     by striking ``$100,000,000'' and inserting ``$500,000,000''.
       (b) Liability Limit.--Section 170 e.(4) of the Atomic 
     Energy Act of 1954 (42 U.S.C. 2210(e)(4)) is amended by 
     striking ``$100,000,000'' and inserting ``$500,000,000''.

     SEC. 606. REPORTS.

       Section 170 p. of the Atomic Energy Act of 1954 (42 U.S.C. 
     2210(p)) is amended by striking ``August 1, 1998'' and 
     inserting ``December 31, 2021''.

     SEC. 607. INFLATION ADJUSTMENT.

       Section 170 t. of the Atomic Energy Act of 1954 (42 U.S.C. 
     2210(t)) is amended--
       (1) by redesignating paragraph (2) as paragraph (3); and
       (2) by inserting after paragraph (1) the following:
       ``(2) The Secretary shall adjust the amount of 
     indemnification provided under an agreement of 
     indemnification under subsection d. not less than once during 
     each 5-year period following July 1, 2003, in accordance with 
     the aggregate percentage change in the Consumer Price Index 
     since--
       ``(A) that date, in the case of the first adjustment under 
     this paragraph; or
       ``(B) the previous adjustment under this paragraph.''.

     SEC. 608. TREATMENT OF MODULAR REACTORS.

       Section 170 b. of the Atomic Energy Act of 1954 (42 U.S.C. 
     2210(b)) is amended by adding at the end the following:
       ``(5)(A) For purposes of this section only, the Commission 
     shall consider a combination of facilities described in 
     subparagraph (B) to be a single facility having a rated 
     capacity of 100,000 electrical kilowatts or more.
       ``(B) A combination of facilities referred to in 
     subparagraph (A) is 2 or more facilities located at a single 
     site, each of which has a rated capacity of 100,000 
     electrical kilowatts or more but not more than 300,000 
     electrical kilowatts, with a combined rated capacity of not 
     more than 1,300,000 electrical kilowatts.''.

     SEC. 609. APPLICABILITY.

       The amendments made by sections 603, 604, and 605 do not 
     apply to a nuclear incident that occurs before the date of 
     the enactment of this Act.

     SEC. 610. CIVIL PENALTIES.

       (a) Repeal of Automatic Remission.--Section 234A b.(2) of 
     the Atomic Energy Act of 1954 (42 U.S.C. 2282a(b)(2)) is 
     amended by striking the last sentence.
       (b) Limitation for Not-for-Profit Institutions.--Subsection 
     d. of section 234A of the Atomic Energy Act of 1954 (42 
     U.S.C. 2282a(d)) is amended to read as follows:
       ``d.(1) Notwithstanding subsection a., in the case of any 
     not-for-profit contractor, subcontractor, or supplier, the 
     total amount of civil penalties paid under subsection a. may 
     not exceed the total amount of fees paid within any 1-year 
     period (as determined by the Secretary) under the contract 
     under which the violation occurs.
       ``(2) For purposes of this section, the term `not-for-
     profit' means that no part of the net earnings of the 
     contractor, subcontractor, or supplier inures to the benefit 
     of any natural person or for-profit artificial person.''.
       (c) Effective Date.--The amendments made by this section 
     shall not apply to any violation of the Atomic Energy Act of 
     1954 (42 U.S.C. 2011 et seq.) occurring under a contract 
     entered into before the date of enactment of this section.
                  Subtitle B--General Nuclear Matters

     SEC. 621. LICENSES.

       Section 103 c. of the Atomic Energy Act of 1954 (42 U.S.C. 
     2133(c)) is amended by inserting ``from the authorization to 
     commence operations'' after ``forty years''.

     SEC. 622. NUCLEAR REGULATORY COMMISSION SCHOLARSHIP AND 
                   FELLOWSHIP PROGRAM.

       (a) In General.--Chapter 19 of the Atomic Energy Act of 
     1954 is amended by inserting after section 242 (42 U.S.C. 
     2015a) the following:

     ``SEC. 243. SCHOLARSHIP AND FELLOWSHIP PROGRAM.

       ``a. Scholarship Program.--To enable students to study, for 
     at least 1 academic semester or equivalent term, science, 
     engineering, or another field of study that the Commission 
     determines is in a critical skill area related to the 
     regulatory mission of the Commission, the Commission may 
     carry out a program to--
       ``(1) award scholarships to undergraduate students who--
       ``(A) are United States citizens; and
       ``(B) enter into an agreement under subsection c. to be 
     employed by the Commission in the area of study for which the 
     scholarship is awarded.
       ``b. Fellowship Program.--To enable students to pursue 
     education in science, engineering, or another field of study 
     that the Commission determines is in a critical skill area 
     related to its regulatory mission, in a graduate or 
     professional degree program offered by an institution of 
     higher education in the United States, the Commission may 
     carry out a program to--
       ``(1) award fellowships to graduate students who--
       ``(A) are United States citizens; and
       ``(B) enter into an agreement under subsection c. to be 
     employed by the Commission in the area of study for which the 
     fellowship is awarded.
       ``c. Requirements.--
       ``(1) In general.--As a condition of receiving a 
     scholarship or fellowship under subsection a. or b., a 
     recipient of the scholarship or fellowship shall enter into 
     an agreement with the Commission under which, in return for 
     the assistance, the recipient shall--

[[Page 17846]]

       ``(A) maintain satisfactory academic progress in the 
     studies of the recipient, as determined by criteria 
     established by the Commission;
       ``(B) agree that failure to maintain satisfactory academic 
     progress shall constitute grounds on which the Commission may 
     terminate the assistance;
       ``(C) on completion of the academic course of study in 
     connection with which the assistance was provided, and in 
     accordance with criteria established by the Commission, 
     engage in employment by the Commission for a period specified 
     by the Commission, that shall be not less than 1 time and not 
     more than 3 times the period for which the assistance was 
     provided; and
       ``(D) if the recipient fails to meet the requirements of 
     subparagraph (A), (B), or (C), reimburse the United States 
     Government for--
       ``(i) the entire amount of the assistance provided the 
     recipient under the scholarship or fellowship; and
       ``(ii) interest at a rate determined by the Commission.
       ``(2) Waiver or suspension.--The Commission may establish 
     criteria for the partial or total waiver or suspension of any 
     obligation of service or payment incurred by a recipient of a 
     scholarship or fellowship under this section.
       ``d. Competitive Process.--Recipients of scholarships or 
     fellowships under this section shall be selected through a 
     competitive process primarily on the basis of academic merit 
     and such other criteria as the Commission may establish, with 
     consideration given to financial need and the goal of 
     promoting the participation of individuals identified in 
     section 33 or 34 of the Science and Engineering Equal 
     Opportunities Act (42 U.S.C. 1885a, 1885b).
       ``e. Direct Appointment.--The Commission may appoint 
     directly, with no further competition, public notice, or 
     consideration of any other potential candidate, an individual 
     who has--
       ``(1) received a scholarship or fellowship awarded by the 
     Commission under this section; and
       ``(2) completed the academic program for which the 
     scholarship or fellowship was awarded.''.
       (b) Conforming Amendment.--The table of sections of the 
     Atomic Energy Act of 1954 (42 U.S.C. prec. 2011) is amended 
     by adding after the item relating to section 242 the 
     following:

``Sec. 243. Scholarship and fellowship program.''.

     SEC. 623. COST RECOVERY FROM GOVERNMENT AGENCIES.

       Section 161 w. of the Atomic Energy Act of 1954 (42 U.S.C. 
     2201(w)) is amended--
       (1) by striking ``for or is issued'' and all that follows 
     through ``1702'' and inserting ``to the Commission for, or is 
     issued by the Commission, a license or certificate'';
       (2) by striking ``483a'' and inserting ``9701''; and
       (3) by striking ``, of applicants for, or holders of, such 
     licenses or certificates''.

     SEC. 624. ELIMINATION OF PENSION OFFSET FOR CERTAIN REHIRED 
                   FEDERAL RETIREES.

       (a) In General.--Chapter 14 of the Atomic Energy Act of 
     1954 (42 U.S.C. 2201 et seq.) is amended by adding at the end 
     the following:

     ``SEC. 170C. ELIMINATION OF PENSION OFFSET FOR CERTAIN 
                   REHIRED FEDERAL RETIREES.

       ``a. In General.--The Commission may waive the application 
     of section 8344 or 8468 of title 5, United States Code, on a 
     case-by-case basis for employment of an annuitant--
       ``(1) in a position of the Commission for which there is 
     exceptional difficulty in recruiting or retaining a qualified 
     employee; or
       ``(2) when a temporary emergency hiring need exists.
       ``b. Procedures.--The Commission shall prescribe procedures 
     for the exercise of authority under this section, including--
       ``(1) criteria for any exercise of authority; and
       ``(2) procedures for a delegation of authority.
       ``c. Effect of Waiver.--An employee as to whom a waiver 
     under this section is in effect shall not be considered an 
     employee for purposes of subchapter II of chapter 83, or 
     chapter 84, of title 5, United States Code.''.
       (b) Conforming Amendment.--The table of sections of the 
     Atomic Energy Act of 1954 (42 U.S.C. prec. 2011) is amended 
     by adding at the end of the items relating to chapter 14 the 
     following:

``Sec. 170C. Elimination of pension offset for certain rehired Federal 
              retirees.''.

     SEC. 625. ANTITRUST REVIEW.

       Section 105 c. of the Atomic Energy Act of 1954 (42 U.S.C. 
     2135(c)) is amended by adding at the end the following:
       ``(9) Applicability.--This subsection does not apply to an 
     application for a license to construct or operate a 
     utilization facility or production facility under section 103 
     or 104 b. that is filed on or after the date of enactment of 
     this paragraph.''.

     SEC. 626. DECOMMISSIONING.

       Section 161 i. of the Atomic Energy Act of 1954 (42 U.S.C. 
     2201(i)) is amended--
       (1) by striking ``and (3)'' and inserting ``(3)''; and
       (2) by inserting before the semicolon at the end the 
     following: ``, and (4) to ensure that sufficient funds will 
     be available for the decommissioning of any production or 
     utilization facility licensed under section 103 or 104 b., 
     including standards and restrictions governing the control, 
     maintenance, use, and disbursement by any former licensee 
     under this Act that has control over any fund for the 
     decommissioning of the facility''.

     SEC. 627. LIMITATION ON LEGAL FEE REIMBURSEMENT.

       Title II of the Energy Reorganization Act of 1974 (42 
     U.S.C. 5841 et seq.) is amended by adding at the end the 
     following new section:


                ``LIMITATION ON LEGAL FEE REIMBURSEMENT

       ``Sec. 212. The Department of Energy shall not, except as 
     required under a contract entered into before the date of 
     enactment of this section, reimburse any contractor or 
     subcontractor of the Department for any legal fees or 
     expenses incurred with respect to a complaint subsequent to--
       ``(1) an adverse determination on the merits with respect 
     to such complaint against the contractor or subcontractor by 
     the Director of the Department of Energy's Office of Hearings 
     and Appeals pursuant to part 708 of title 10, Code of Federal 
     Regulations, or by a Department of Labor Administrative Law 
     Judge pursuant to section 211 of this Act; or
       ``(2) an adverse final judgment by any State or Federal 
     court with respect to such complaint against the contractor 
     or subcontractor for wrongful termination or retaliation due 
     to the making of disclosures protected under chapter 12 of 
     title 5, United States Code, section 211 of this Act, or any 
     comparable State law,

     unless the adverse determination or final judgment is 
     reversed upon further administrative or judicial review.''.

     SEC. 628. DECOMMISSIONING PILOT PROGRAM.

       (a) Pilot Program.--The Secretary shall establish a 
     decommissioning pilot program under which the Secretary shall 
     decommission and decontaminate the sodium-cooled fast breeder 
     experimental test-site reactor located in northwest Arkansas, 
     in accordance with the decommissioning activities contained 
     in the report of the Department relating to the reactor, 
     dated August 31, 1998.
       (b) Authorization of Appropriations.--There is authorized 
     to be appropriated to the Secretary to carry out this section 
     $16,000,000.

     SEC. 629. WHISTLEBLOWER PROTECTION.

       (a) Definition of Employer.--Section 211(a)(2) of the 
     Energy Reorganization Act of 1974 (42 U.S.C. 5851(a)(2)) is 
     amended--
       (1) in subparagraph (C), by striking ``and'' at the end;
       (2) in subparagraph (D), by striking the period at the end 
     and inserting a semicolon; and
       (3) by adding at the end the following:
       ``(E) a contractor or subcontractor of the Commission;
       ``(F) the Commission; and
       ``(G) the Department of Energy.''.
       (b) De Novo Review.--Subsection (b) of such section 211 is 
     amended by adding at the end the following new paragraph:
       ``(4) If the Secretary has not issued a final decision 
     within 1 year after the filing of a complaint under paragraph 
     (1), and there is no showing that such delay is due to the 
     bad faith of the person seeking relief under this paragraph, 
     such person may bring an action at law or equity for de novo 
     review in the appropriate district court of the United 
     States, which shall have jurisdiction over such an action 
     without regard to the amount in controversy.''.

     SEC. 630. MEDICAL ISOTOPE PRODUCTION.

       Section 134 of the Atomic Energy Act of 1954 (42 U.S.C. 
     2160d) is amended--
       (1) in subsection a., by striking ``a. The Commission'' and 
     inserting ``a. In General.--Except as provided in subsection 
     b., the Commission'';
       (2) by redesignating subsection b. as subsection c.; and
       (3) by inserting after subsection a. the following:
       ``b. Medical isotope production.--
       ``(1) Definitions.--In this subsection:
       ``(A) Highly enriched uranium.--The term `highly enriched 
     uranium' means uranium enriched to include concentration of 
     U-235 above 20 percent.
       ``(B) Medical isotope.--The term `medical isotope' includes 
     Molybdenum 99, Iodine 131, Xenon 133, and other radioactive 
     materials used to produce a radiopharmaceutical for 
     diagnostic, therapeutic procedures or for research and 
     development.
       ``(C) Radiopharmaceutical.--The term `radiopharmaceutical' 
     means a radioactive isotope that--
       ``(i) contains byproduct material combined with chemical or 
     biological material; and
       ``(ii) is designed to accumulate temporarily in a part of 
     the body for therapeutic purposes or for enabling the 
     production of a useful image for use in a diagnosis of a 
     medical condition.
       ``(D) Recipient country.--The term `recipient country' 
     means Canada, Belgium, France, Germany, and the Netherlands.
       ``(2) Licenses.--The Commission may issue a license 
     authorizing the export (including shipment to and use at 
     intermediate and ultimate consignees specified in the 
     license) to a recipient country of highly enriched uranium 
     for medical isotope production if, in addition to any other 
     requirements of this Act (except subsection a.), the 
     Commission determines that--
       ``(A) a recipient country that supplies an assurance letter 
     to the United States Government in connection with the 
     consideration by the Commission of the export license 
     application has informed the United States Government that 
     any intermediate consignees and the ultimate consignee 
     specified in the application are required to use the highly 
     enriched uranium solely to produce medical isotopes; and
       ``(B) the highly enriched uranium for medical isotope 
     production will be irradiated only in a reactor in a 
     recipient country that--
       ``(i) uses an alternative nuclear reactor fuel; or

[[Page 17847]]

       ``(ii) is the subject of an agreement with the United 
     States Government to convert to an alternative nuclear 
     reactor fuel when alternative nuclear reactor fuel can be 
     used in the reactor.
       ``(3) Review of physical protection requirements.--
       ``(A) In general.--The Commission shall review the adequacy 
     of physical protection requirements that, as of the date of 
     an application under paragraph (2), are applicable to the 
     transportation and storage of highly enriched uranium for 
     medical isotope production or control of residual material 
     after irradiation and extraction of medical isotopes.
       ``(B) Imposition of additional requirements.--If the 
     Commission determines that additional physical protection 
     requirements are necessary (including a limit on the quantity 
     of highly enriched uranium that may be contained in a single 
     shipment), the Commission shall impose such requirements as 
     license conditions or through other appropriate means.
       ``(4) First report to congress.--
       ``(A) NAS study.--The Secretary shall enter into an 
     arrangement with the National Academy of Sciences to conduct 
     a study to determine--
       ``(i) the feasibility of procuring supplies of medical 
     isotopes from commercial sources that do not use highly 
     enriched uranium;
       ``(ii) the current and projected demand and availability of 
     medical isotopes in regular current domestic use;
       ``(iii) the progress that is being made by the Department 
     of Energy and others to eliminate all use of highly enriched 
     uranium in reactor fuel, reactor targets, and medical isotope 
     production facilities; and
       ``(iv) the potential cost differential in medical isotope 
     production in the reactors and target processing facilities 
     if the products were derived from production systems that do 
     not involve fuels and targets with highly enriched uranium.
       ``(B) Feasibility.--For the purpose of this subsection, the 
     use of low enriched uranium to produce medical isotopes shall 
     be determined to be feasible if--
       ``(i) low enriched uranium targets have been developed and 
     demonstrated for use in the reactors and target processing 
     facilities that produce significant quantities of medical 
     isotopes to serve United States needs for such isotopes;
       ``(ii) sufficient quantities of medical isotopes are 
     available from low enriched uranium targets and fuel to meet 
     United States domestic needs; and
       ``(iii) the average anticipated total cost increase from 
     production of medical isotopes in such facilities without use 
     of highly enriched uranium is less than 10 percent.
       ``(C) Report by the secretary.--Not later than 5 years 
     after the date of enactment of the Energy Policy Act of 2005, 
     the Secretary shall submit to Congress a report that--
       ``(i) contains the findings of the National Academy of 
     Sciences made in the study under subparagraph (A); and
       ``(ii) discloses the existence of any commitments from 
     commercial producers to provide domestic requirements for 
     medical isotopes without use of highly enriched uranium 
     consistent with the feasibility criteria described in 
     subparagraph (B) not later than the date that is 4 years 
     after the date of submission of the report.
       ``(5) Second report to congress.--If the study of the 
     National Academy of Sciences determines under paragraph 
     (4)(A)(i) that the procurement of supplies of medical 
     isotopes from commercial sources that do not use highly 
     enriched uranium is feasible, but the Secretary is unable to 
     report the existence of commitments under paragraph 
     (4)(C)(ii), not later than the date that is 6 years after the 
     date of enactment of the Energy Policy Act of 2005, the 
     Secretary shall submit to Congress a report that describes 
     options for developing domestic supplies of medical isotopes 
     in quantities that are adequate to meet domestic demand 
     without the use of highly enriched uranium consistent with 
     the cost increase described in paragraph (4)(B)(iii).
       ``(6) Certification.--At such time as commercial facilities 
     that do not use highly enriched uranium are capable of 
     meeting domestic requirements for medical isotopes, within 
     the cost increase described in paragraph (4)(B)(iii) and 
     without impairing the reliable supply of medical isotopes for 
     domestic utilization, the Secretary shall submit to Congress 
     a certification to that effect.
       ``(7) Sunset provision.--After the Secretary submits a 
     certification under paragraph (6), the Commission shall, by 
     rule, terminate its review of export license applications 
     under this subsection.''.

     SEC. 631. SAFE DISPOSAL OF GREATER-THAN-CLASS C RADIOACTIVE 
                   WASTE.

       (a) Responsibility for Activities To Provide Storage 
     Facility.--The Secretary shall provide to Congress official 
     notification of the final designation of an entity within the 
     Department to have the responsibility of completing 
     activities needed to provide a facility for safely disposing 
     of all greater-than-Class C low-level radioactive waste.
       (b) Reports and Plans.--
       (1) Report on permanent disposal facility.--
       (A) Plan regarding cost and schedule for completion of eis 
     and rod.--Not later than 1 year after the date of enactment 
     of this Act, the Secretary, in consultation with Congress, 
     shall submit to Congress a report containing an estimate of 
     the cost and a proposed schedule to complete an environmental 
     impact statement and record of decision for a permanent 
     disposal facility for greater-than-Class C radioactive waste.
       (B) Analysis of alternatives.--Before the Secretary makes a 
     final decision on the disposal alternative or alternatives to 
     be implemented, the Secretary shall--
       (i) submit to Congress a report that describes all 
     alternatives under consideration, including all information 
     required in the comprehensive report making recommendations 
     for ensuring the safe disposal of all greater-than-Class C 
     low-level radioactive waste that was submitted by the 
     Secretary to Congress in February 1987; and
       (ii) await action by Congress.
       (2) Short-term plan for recovery and storage.--
       (A) In general.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     a plan to ensure the continued recovery and storage of 
     greater-than-Class C low-level radioactive sealed sources 
     that pose a security threat until a permanent disposal 
     facility is available.
       (B) Contents.--The plan shall address estimated cost, 
     resource, and facility needs.

     SEC. 632. PROHIBITION ON NUCLEAR EXPORTS TO COUNTRIES THAT 
                   SPONSOR TERRORISM.

       (a) In General.--Section 129 of the Atomic Energy Act of 
     1954 (42 U.S.C. 2158) is amended--
       (1) by inserting ``a.'' before ``No nuclear materials and 
     equipment''; and
       (2) by adding at the end the following new subsection:
       ``b.(1) Notwithstanding any other provision of law, 
     including specifically section 121 of this Act, and except as 
     provided in paragraphs (2) and (3), no nuclear materials and 
     equipment or sensitive nuclear technology, including items 
     and assistance authorized by section 57 b. of this Act and 
     regulated under part 810 of title 10, Code of Federal 
     Regulations, and nuclear-related items on the Commerce 
     Control List maintained under part 774 of title 15 of the 
     Code of Federal Regulations, shall be exported or reexported, 
     or transferred or retransferred whether directly or 
     indirectly, and no Federal agency shall issue any license, 
     approval, or authorization for the export or reexport, or 
     transfer, or retransfer, whether directly or indirectly, of 
     these items or assistance (as defined in this paragraph) to 
     any country whose government has been identified by the 
     Secretary of State as engaged in state sponsorship of 
     terrorist activities (specifically including any country the 
     government of which has been determined by the Secretary of 
     State under section 620A(a) of the Foreign Assistance Act of 
     1961 (22 U.S.C. 2371(a)), section 6(j)(1) of the Export 
     Administration Act of 1979 (50 U.S.C. App. 2405(j)(1)), or 
     section 40(d) of the Arms Export Control Act (22 U.S.C. 
     2780(d)) to have repeatedly provided support for acts of 
     international terrorism).
       ``(2) This subsection shall not apply to exports, 
     reexports, transfers, or retransfers of radiation monitoring 
     technologies, surveillance equipment, seals, cameras, tamper-
     indication devices, nuclear detectors, monitoring systems, or 
     equipment necessary to safely store, transport, or remove 
     hazardous materials, whether such items, services, or 
     information are regulated by the Department of Energy, the 
     Department of Commerce, or the Commission, except to the 
     extent that such technologies, equipment, seals, cameras, 
     devices, detectors, or systems are available for use in the 
     design or construction of nuclear reactors or nuclear 
     weapons.
       ``(3) The President may waive the application of paragraph 
     (1) to a country if the President determines and certifies to 
     Congress that the waiver will not result in any increased 
     risk that the country receiving the waiver will acquire 
     nuclear weapons, nuclear reactors, or any materials or 
     components of nuclear weapons and--
       ``(A) the government of such country has not within the 
     preceding 12-month period willfully aided or abetted the 
     international proliferation of nuclear explosive devices to 
     individuals or groups or willfully aided and abetted an 
     individual or groups in acquiring unsafeguarded nuclear 
     materials;
       ``(B) in the judgment of the President, the government of 
     such country has provided adequate, verifiable assurances 
     that it will cease its support for acts of international 
     terrorism;
       ``(C) the waiver of that paragraph is in the vital national 
     security interest of the United States; or
       ``(D) such a waiver is essential to prevent or respond to a 
     serious radiological hazard in the country receiving the 
     waiver that may or does threaten public health and safety.''.
       (b) Applicability to Exports Approved for Transfer but Not 
     Transferred.--Subsection b. of section 129 of Atomic Energy 
     Act of 1954, as added by subsection (a) of this section, 
     shall apply with respect to exports that have been approved 
     for transfer as of the date of the enactment of this Act but 
     have not yet been transferred as of that date.

     SEC. 633. EMPLOYEE BENEFITS.

       Section 3110(a) of the USEC Privatization Act (42 U.S.C. 
     2297h-8(a)) is amended by adding at the end the following new 
     paragraph:
       ``(8) Continuity of benefits.--To the extent appropriations 
     are provided in advance for this purpose or are otherwise 
     available, not later than 30 days after the date of enactment 
     of this paragraph, the Secretary shall implement such actions 
     as are necessary to ensure that any employee who--
       ``(A) is involved in providing infrastructure or 
     environmental remediation services at the Portsmouth, Ohio, 
     or the Paducah, Kentucky, Gaseous Diffusion Plant;

[[Page 17848]]

       ``(B) has been an employee of the Department of Energy's 
     predecessor management and integrating contractor (or its 
     first or second tier subcontractors), or of the Corporation, 
     at the Portsmouth, Ohio, or the Paducah, Kentucky, facility; 
     and
       ``(C) was eligible as of April 1, 2005, to participate in 
     or transfer into the Multiple Employer Pension Plan or the 
     associated multiple employer retiree health care benefit 
     plans, as defined in those plans,
     shall continue to be eligible to participate in or transfer 
     into such pension or health care benefit plans.''.

     SEC. 634. DEMONSTRATION HYDROGEN PRODUCTION AT EXISTING 
                   NUCLEAR POWER PLANTS.

       (a) Demonstration Projects.--The Secretary shall provide 
     for the establishment of 2 projects in geographic areas that 
     are regionally and climatically diverse to demonstrate the 
     commercial production of hydrogen at existing nuclear power 
     plants.
       (b) Economic Analysis.--Prior to making an award under 
     subsection (a), the Secretary shall determine whether the use 
     of existing nuclear power plants is a cost-effective means of 
     producing hydrogen.
       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary for the purposes of 
     carrying out this section not more than $100,000,000.

     SEC. 635. PROHIBITION ON ASSUMPTION BY UNITED STATES 
                   GOVERNMENT OF LIABILITY FOR CERTAIN FOREIGN 
                   INCIDENTS.

       (a) In General.--Notwithstanding any other provision of 
     law, no officer of the United States or of any department, 
     agency, or instrumentality of the United States Government 
     may enter into any contract or other arrangement, or into any 
     amendment or modification of a contract or other arrangement, 
     the purpose or effect of which would be to directly or 
     indirectly impose liability on the United States Government, 
     or any department, agency, or instrumentality of the United 
     States Government, or to otherwise directly or indirectly 
     require an indemnity by the United States Government, for 
     nuclear incidents occurring in connection with the design, 
     construction, or operation of a production facility or 
     utilization facility in any country whose government has been 
     identified by the Secretary of State as engaged in state 
     sponsorship of terrorist activities (specifically including 
     any country the government of which, as of September 11, 
     2001, had been determined by the Secretary of State under 
     section 620A(a) of the Foreign Assistance Act of 1961 (22 
     U.S.C. 2371(a)), section 6(j)(1) of the Export Administration 
     Act of 1979 (50 U.S.C. App. 2405(j)(1)), or section 40(d) of 
     the Arms Export Control Act (22 U.S.C. 2780(d)) to have 
     repeatedly provided support for acts of international 
     terrorism). This section shall not apply to nuclear incidents 
     occurring as a result of missions, carried out under the 
     direction of the Secretary, the Secretary of Defense, or the 
     Secretary of State, that are necessary to safely secure, 
     store, transport, or remove nuclear materials for nuclear 
     safety or nonproliferation purposes.
       (b) Definitions.--The terms used in this section shall have 
     the same meaning as those terms have under section 11 of the 
     Atomic Energy Act of 1954 (42 U.S.C. 2014), unless otherwise 
     expressly provided in this section.

     SEC. 636. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated such sums as are 
     necessary to carry out this subtitle and the amendments made 
     by this subtitle.

     SEC. 637. NUCLEAR REGULATORY COMMISSION USER FEES AND ANNUAL 
                   CHARGES.

       (a) In General.--Section 6101 of the Omnibus Budget 
     Reconciliation Act of 1990 (42 U.S.C. 2214) is amended--
       (1) in subsection (a)--
       (A) by striking ``Except as provided in paragraph (3), 
     the'' and inserting ``The'' in paragraph (1); and
       (B) by striking paragraph (3); and
       (2) in subsection (c)--
       (A) by striking ``and'' at the end of paragraph (2)(A)(i);
       (B) by striking the period at the end of paragraph 
     (2)(A)(ii) and inserting a semicolon;
       (C) by adding at the end of paragraph (2)(A) the following 
     new clauses:
       ``(iii) amounts appropriated to the Commission for the 
     fiscal year for implementation of section 3116 of the Ronald 
     W. Reagan National Defense Authorization Act for Fiscal Year 
     2005; and
       ``(iv) amounts appropriated to the Commission for homeland 
     security activities of the Commission for the fiscal year, 
     except for the costs of fingerprinting and background checks 
     required by section 149 of the Atomic Energy Act of 1954 (42 
     U.S.C. 2169) and the costs of conducting security 
     inspections.''; and
       (D) by amending paragraph (2)(B)(v) to read as follows:
       ``(v) 90 percent for fiscal year 2005 and each fiscal year 
     thereafter.''.
       (b) Repeal.--Section 7601 of the Consolidated Omnibus 
     Budget Reconciliation Act of 1985 (42 U.S.C. 2213) is 
     repealed.
       (c) Effective Date.--The amendments made by this section 
     take effect on October 1, 2006.

     SEC. 638. STANDBY SUPPORT FOR CERTAIN NUCLEAR PLANT DELAYS.

       (a) Definitions.--In this section:
       (1) Advanced nuclear facility.--The term ``advanced nuclear 
     facility'' means any nuclear facility the reactor design for 
     which is approved after December 31, 1993, by the Commission 
     (and such design or a substantially similar design of 
     comparable capacity was not approved on or before that date).
       (2) Combined license.--The term ``combined license'' means 
     a combined construction and operating license for an advanced 
     nuclear facility issued by the Commission.
       (3) Commission.--The term ``Commission'' means the Nuclear 
     Regulatory Commission.
       (4) Sponsor.--The term ``sponsor'' means a person who has 
     applied for or been granted a combined license.
       (b) Contract Authority.--
       (1) In general.--The Secretary may enter into contracts 
     under this section with sponsors of an advanced nuclear 
     facility that cover a total of 6 reactors, with the 6 
     reactors consisting of not more than 3 different reactor 
     designs, in accordance with paragraph (2).
       (2) Requirement for contracts.--
       (A) Definition of loan cost.--In this paragraph, the term 
     ``loan cost'' has the meaning given the term ``cost of a loan 
     guarantee'' under section 502(5)(C) of the Federal Credit 
     Reform Act of 1990 (2 U.S.C. 661a(5)(C)).
       (B) Establishment of accounts.--There is established in the 
     Department 2 separate accounts, which shall be known as the--
       (i) ``Standby Support Program Account''; and
       (ii) ``Standby Support Grant Account''.
       (C) Requirement.--The Secretary shall not enter into a 
     contract under this section unless the Secretary deposits--
       (i) in the Standby Support Program Account established 
     under subparagraph (B), funds appropriated to the Secretary 
     in advance of the contract or a combination of appropriated 
     funds and loan guarantee fees that are in an amount 
     sufficient to cover the loan costs described in subsection 
     (d)(5)(A); and
       (ii) in the Standby Support Grant Account established under 
     subparagraph (B), funds appropriated to the Secretary in 
     advance of the contract, paid to the Secretary by the sponsor 
     of the advanced nuclear facility, or a combination of 
     appropriations and payments that are in an amount sufficient 
     cover the costs described in subparagraphs (B), (C), and (D) 
     of subsection (d)(5).
       (c) Covered Delays.--
       (1) Inclusions.--Under each contract authorized by this 
     section, the Secretary shall pay the costs specified in 
     subsection (d), using funds appropriated or collected for the 
     covered costs, if full power operation of the advanced 
     nuclear facility is delayed by--
       (A) the failure of the Commission to comply with schedules 
     for review and approval of inspections, tests, analyses, and 
     acceptance criteria established under the combined license or 
     the conduct of preoperational hearings by the Commission for 
     the advanced nuclear facility; or
       (B) litigation that delays the commencement of full-power 
     operations of the advanced nuclear facility.
       (2) Exclusions.--The Secretary may not enter into any 
     contract under this section that would obligate the Secretary 
     to pay any costs resulting from--
       (A) the failure of the sponsor to take any action required 
     by law or regulation;
       (B) events within the control of the sponsor; or
       (C) normal business risks.
       (d) Covered Costs.--
       (1) In general.--Subject to paragraphs (2), (3), and (4), 
     the costs that shall be paid by the Secretary pursuant to a 
     contract entered into under this section are the costs that 
     result from a delay covered by the contract.
       (2) Initial 2 reactors.--In the case of the first 2 
     reactors that receive combined licenses and on which 
     construction is commenced, the Secretary shall pay--
       (A) 100 percent of the covered costs of delay; but
       (B) not more than $500,000,000 per contract.
       (3) Subsequent 4 reactors.--In the case of the next 4 
     reactors that receive a combined license and on which 
     construction is commenced, the Secretary shall pay--
       (A) 50 percent of the covered costs of delay that occur 
     after the initial 180-day period of covered delay; but
       (B) not more than $250,000,000 per contract.
       (4) Conditions on payment of certain covered costs.--
       (A) In general.--The obligation of the Secretary to pay the 
     covered costs described in subparagraph (B) of paragraph (5) 
     is subject to the Secretary receiving from appropriations or 
     payments from other non-Federal sources amounts sufficient to 
     pay the covered costs.
       (B) Non-federal sources.--The Secretary may receive and 
     accept payments from any non-Federal source, which shall be 
     made available without further appropriation for the payment 
     of the covered costs.
       (5) Types of covered costs.--Subject to paragraphs (2), 
     (3), and (4), the contract entered into under this section 
     for an advanced nuclear facility shall include as covered 
     costs those costs that result from a delay during 
     construction and in gaining approval for fuel loading and 
     full-power operation, including--
       (A) principal or interest on any debt obligation of an 
     advanced nuclear facility owned by a non-Federal entity; and
       (B) the incremental difference between--
       (i) the fair market price of power purchased to meet the 
     contractual supply agreements that would have been met by the 
     advanced nuclear facility but for the delay; and
       (ii) the contractual price of power from the advanced 
     nuclear facility subject to the delay.
       (e) Requirements.--Any contract between a sponsor and the 
     Secretary covering an advanced nuclear facility under this 
     section shall require the sponsor to use due diligence to 
     shorten, and to end, the delay covered by the contract.

[[Page 17849]]

       (f) Reports.--For each advanced nuclear facility that is 
     covered by a contract under this section, the Commission 
     shall submit to Congress and the Secretary quarterly reports 
     summarizing the status of licensing actions associated with 
     the advanced nuclear facility.
       (g) Regulations.--
       (1) In general.--Subject to paragraphs (2) and (3), the 
     Secretary shall issue such regulations as are necessary to 
     carry out this section.
       (2) Interim final rulemaking.--Not later than 270 days 
     after the date of enactment of this Act, the Secretary shall 
     issue for public comment an interim final rule regulating 
     contracts authorized by this section.
       (3) Notice of final rulemaking.--Not later than 1 year 
     after the date of enactment of this Act, the Secretary shall 
     issue a notice of final rulemaking regulating the contracts.
       (h) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section.

     SEC. 639. CONFLICTS OF INTEREST RELATING TO CONTRACTS AND 
                   OTHER ARRANGEMENTS.

       Section 170A b. of the Atomic Energy Act of 1954 (42 U.S.C. 
     2210a(b)) is amended--
       (1) by redesignating paragraphs (1) and (2) as 
     subparagraphs (A) and (B), respectively, and indenting 
     appropriately;
       (2) by striking ``b. The Commission'' and inserting the 
     following:
       ``b. Evaluation.--
       ``(1) In general.--Except as provided in paragraph (2), the 
     Nuclear Regulatory Commission''; and
       (3) by adding at the end the following:
       ``(2) Nuclear regulatory commission.--Notwithstanding any 
     conflict of interest, the Nuclear Regulatory Commission may 
     enter into a contract, agreement, or arrangement with the 
     Department of Energy or the operator of a Department of 
     Energy facility, if the Nuclear Regulatory Commission 
     determines that--
       ``(A) the conflict of interest cannot be mitigated; and
       ``(B) adequate justification exists to proceed without 
     mitigation of the conflict of interest.''.
           Subtitle C--Next Generation Nuclear Plant Project

     SEC. 641. PROJECT ESTABLISHMENT.

       (a) Establishment.--The Secretary shall establish a project 
     to be known as the ``Next Generation Nuclear Plant Project'' 
     (referred to in this subtitle as the ``Project'').
       (b) Content.--The Project shall consist of the research, 
     development, design, construction, and operation of a 
     prototype plant, including a nuclear reactor that--
       (1) is based on research and development activities 
     supported by the Generation IV Nuclear Energy Systems 
     Initiative under section 942(d); and
       (2) shall be used--
       (A) to generate electricity;
       (B) to produce hydrogen; or
       (C) both to generate electricity and to produce hydrogen.

     SEC. 642. PROJECT MANAGEMENT.

       (a) Departmental Management.--
       (1) In general.--The Project shall be managed in the 
     Department by the Office of Nuclear Energy, Science, and 
     Technology.
       (2) Generation iv nuclear energy systems program.--The 
     Secretary may combine the Project with the Generation IV 
     Nuclear Energy Systems Initiative.
       (3) Existing doe project management expertise.--The 
     Secretary may utilize capabilities for review of construction 
     projects for advanced scientific facilities within the Office 
     of Science to track the progress of the Project.
       (b) Laboratory Management.--
       (1) Lead laboratory.--The Idaho National Laboratory shall 
     be the lead National Laboratory for the Project and shall 
     collaborate with other National Laboratories, institutions of 
     higher education, other research institutes, industrial 
     researchers, and international researchers to carry out the 
     Project.
       (2) Industrial partnerships.--
       (A) In general.--The Idaho National Laboratory shall 
     organize a consortium of appropriate industrial partners that 
     will carry out cost-shared research, development, design, and 
     construction activities, and operate research facilities, on 
     behalf of the Project.
       (B) Cost-sharing.--Activities of industrial partners funded 
     by the Project shall be cost-shared in accordance with 
     section 988.
       (C) Preference.--Preference in determining the final 
     structure of the consortium or any partnerships under this 
     subtitle shall be given to a structure (including designating 
     as a lead industrial partner an entity incorporated in the 
     United States) that retains United States technological 
     leadership in the Project while maximizing cost sharing 
     opportunities and minimizing Federal funding 
     responsibilities.
       (3) Prototype plant siting.--The prototype nuclear reactor 
     and associated plant shall be sited at the Idaho National 
     Laboratory in Idaho.
       (4) Reactor test capabilities.--The Project shall use, if 
     appropriate, reactor test capabilities at the Idaho National 
     Laboratory.
       (5) Other laboratory capabilities.--The Project may use, if 
     appropriate, facilities at other National Laboratories.

     SEC. 643. PROJECT ORGANIZATION.

       (a) Major Project Elements.--The Project shall consist of 
     the following major program elements:
       (1) High-temperature hydrogen production technology 
     development and validation.
       (2) Energy conversion technology development and 
     validation.
       (3) Nuclear fuel development, characterization, and 
     qualification.
       (4) Materials selection, development, testing, and 
     qualification.
       (5) Reactor and balance-of-plant design, engineering, 
     safety analysis, and qualification.
       (b) Project Phases.--The Project shall be conducted in the 
     following phases:
       (1) First project phase.--A first project phase shall be 
     conducted to--
       (A) select and validate the appropriate technology under 
     subsection (a)(1);
       (B) carry out enabling research, development, and 
     demonstration activities on technologies and components under 
     paragraphs (2) through (4) of subsection (a);
       (C) determine whether it is appropriate to combine 
     electricity generation and hydrogen production in a single 
     prototype nuclear reactor and plant; and
       (D) carry out initial design activities for a prototype 
     nuclear reactor and plant, including development of design 
     methods and safety analytical methods and studies under 
     subsection (a)(5).
       (2) Second project phase.--A second project phase shall be 
     conducted to--
       (A) continue appropriate activities under paragraphs (1) 
     though (5) of subsection (a);
       (B) develop, through a competitive process, a final design 
     for the prototype nuclear reactor and plant;
       (C) apply for licenses to construct and operate the 
     prototype nuclear reactor from the Nuclear Regulatory 
     Commission; and
       (D) construct and start up operations of the prototype 
     nuclear reactor and its associated hydrogen or electricity 
     production facilities.
       (c) Project Requirements.--
       (1) In general.--The Secretary shall ensure that the 
     Project is structured so as to maximize the technical 
     interchange and transfer of technologies and ideas into the 
     Project from other sources of relevant expertise, including--
       (A) the nuclear power industry, including nuclear 
     powerplant construction firms, particularly with respect to 
     issues associated with plant design, construction, and 
     operational and safety issues;
       (B) the chemical processing industry, particularly with 
     respect to issues relating to--
       (i) the use of process energy for production of hydrogen; 
     and
       (ii) the integration of technologies developed by the 
     Project into chemical processing environments; and
       (C) international efforts in areas related to the Project, 
     particularly with respect to hydrogen production 
     technologies.
       (2) International collaboration.--
       (A) In general.--The Secretary shall seek international 
     cooperation, participation, and financial contributions for 
     the Project.
       (B) Assistance from international partners.--The Secretary, 
     through the Idaho National Laboratory, may contract for 
     assistance from specialists or facilities from member 
     countries of the Generation IV International Forum, the 
     Russian Federation, or other international partners if the 
     specialists or facilities provide access to cost-effective 
     and relevant skills or test capabilities.
       (C) Partner nations.--The Project may involve demonstration 
     of selected project objectives in a partner country.
       (D) Generation iv international forum.--The Secretary shall 
     ensure that international activities of the Project are 
     coordinated with the Generation IV International Forum.
       (3) Review by nuclear energy research advisory committee.--
       (A) In general.--The Nuclear Energy Research Advisory 
     Committee of the Department (referred to in this paragraph as 
     the ``NERAC'') shall--
       (i) review all program plans for the Project and all 
     progress under the Project on an ongoing basis; and
       (ii) ensure that important scientific, technical, safety, 
     and program management issues receive attention in the 
     Project and by the Secretary.
       (B) Additional expertise.--The NERAC shall supplement the 
     expertise of the NERAC or appoint subpanels to incorporate 
     into the review by the NERAC the relevant sources of 
     expertise described under paragraph (1).
       (C) Initial review.--Not later than 180 days after the date 
     of enactment of this Act, the NERAC shall--
       (i) review existing program plans for the Project in light 
     of the recommendations of the document entitled ``Design 
     Features and Technology Uncertainties for the Next Generation 
     Nuclear Plant,'' dated June 30, 2004; and
       (ii) address any recommendations of the document not 
     incorporated in program plans for the Project.
       (D) First project phase review.--On a determination by the 
     Secretary that the appropriate activities under the first 
     project phase under subsection (b)(1) are nearly complete, 
     the Secretary shall request the NERAC to conduct a 
     comprehensive review of the Project and to report to the 
     Secretary the recommendation of the NERAC concerning whether 
     the Project is ready to proceed to the second project phase 
     under subsection (b)(2).
       (E) Transmittal of reports to congress.--Not later than 60 
     days after receiving any report from the NERAC related to the 
     Project, the Secretary shall submit to the appropriate 
     committees of the Senate and the House of Representatives a 
     copy of the report, along with any additional views of the 
     Secretary that the Secretary may consider appropriate.

     SEC. 644. NUCLEAR REGULATORY COMMISSION.

       (a) In General.--In accordance with section 202 of the 
     Energy Reorganization Act of 1974 (42

[[Page 17850]]

     U.S.C. 5842), the Nuclear Regulatory Commission shall have 
     licensing and regulatory authority for any reactor authorized 
     under this subtitle.
       (b) Licensing Strategy.--Not later than 3 years after the 
     date of enactment of this Act, the Secretary and the Chairman 
     of the Nuclear Regulatory Commission shall jointly submit to 
     the appropriate committees of the Senate and the House of 
     Representatives a licensing strategy for the prototype 
     nuclear reactor, including--
       (1) a description of ways in which current licensing 
     requirements relating to light-water reactors need to be 
     adapted for the types of prototype nuclear reactor being 
     considered by the Project;
       (2) a description of analytical tools that the Nuclear 
     Regulatory Commission will have to develop to independently 
     verify designs and performance characteristics of components, 
     equipment, systems, or structures associated with the 
     prototype nuclear reactor;
       (3) other research or development activities that may be 
     required on the part of the Nuclear Regulatory Commission in 
     order to review a license application for the prototype 
     nuclear reactor; and
       (4) an estimate of the budgetary requirements associated 
     with the licensing strategy.
       (c) Ongoing Interaction.--The Secretary shall seek the 
     active participation of the Nuclear Regulatory Commission 
     throughout the duration of the Project to--
       (1) avoid design decisions that will compromise adequate 
     safety margins in the design of the reactor or impair the 
     accessibility of nuclear safety-related components of the 
     prototype reactor for inspection and maintenance;
       (2) develop tools to facilitate inspection and maintenance 
     needed for safety purposes; and
       (3) develop risk-based criteria for any future commercial 
     development of a similar reactor architectures.

     SEC. 645. PROJECT TIMELINES AND AUTHORIZATION OF 
                   APPROPRIATIONS.

       (a) Target Date to Complete the First Project Phase.--Not 
     later than September 30, 2011, the Secretary shall--
       (1) select the technology to be used by the Project for 
     high-temperature hydrogen production and the initial design 
     parameters for the prototype nuclear plant; or
       (2) submit to Congress a report establishing an alternative 
     date for making the selection.
       (b) Design Competition for Second Project Phase.--
       (1) In general.--The Secretary, acting through the Idaho 
     National Laboratory, shall fund not more than 4 teams for not 
     more than 2 years to develop detailed proposals for 
     competitive evaluation and selection of a single proposal for 
     a final design of the prototype nuclear reactor.
       (2) Systems integration.--The Secretary may structure 
     Project activities in the second project phase to use the 
     lead industrial partner of the competitively selected design 
     under paragraph (1) in a systems integration role for final 
     design and construction of the Project.
       (c) Target Date to Complete Project Construction.--Not 
     later than September 30, 2021, the Secretary shall--
       (1) complete construction and begin operations of the 
     prototype nuclear reactor and associated energy or hydrogen 
     facilities; or
       (2) submit to Congress a report establishing an alternative 
     date for completion.
       (d) Authorization of Appropriations.--There is authorized 
     to be appropriated to the Secretary for research and 
     construction activities under this subtitle (including for 
     transfer to the Nuclear Regulatory Commission for activities 
     under section 644 as appropriate)--
       (1) $1,250,000,000 for the period of fiscal years 2006 
     through 2015; and
       (2) such sums as are necessary for each of fiscal years 
     2016 through 2021.
                      Subtitle D--Nuclear Security

     SEC. 651. NUCLEAR FACILITY AND MATERIALS SECURITY.

       (a) Security Evaluations; Design Basis Threat Rulemaking.--
       (1) In general.--Chapter 14 of the Atomic Energy Act of 
     1954 (42 U.S.C. 2201 et seq.) (as amended by section 624(a)) 
     is amended by adding at the end the following:

     ``SEC. 170D. SECURITY EVALUATIONS.

       ``a. Security Response Evaluations.--Not less often than 
     once every 3 years, the Commission shall conduct security 
     evaluations at each licensed facility that is part of a class 
     of licensed facilities, as the Commission considers to be 
     appropriate, to assess the ability of a private security 
     force of a licensed facility to defend against any applicable 
     design basis threat.
       ``b. Force-on-Force Exercises.--(1) The security 
     evaluations shall include force-on-force exercises.
       ``(2) The force-on-force exercises shall, to the maximum 
     extent practicable, simulate security threats in accordance 
     with any design basis threat applicable to a facility.
       ``(3) In conducting a security evaluation, the Commission 
     shall mitigate any potential conflict of interest that could 
     influence the results of a force-on-force exercise, as the 
     Commission determines to be necessary and appropriate.
       ``c. Action by Licensees.--The Commission shall ensure that 
     an affected licensee corrects those material defects in 
     performance that adversely affect the ability of a private 
     security force at that facility to defend against any 
     applicable design basis threat.
       ``d. Facilities Under Heightened Threat Levels.--The 
     Commission may suspend a security evaluation under this 
     section if the Commission determines that the evaluation 
     would compromise security at a nuclear facility under a 
     heightened threat level.
       ``e. Report.--Not less often than once each year, the 
     Commission shall submit to the Committee on Environment and 
     Public Works of the Senate and the Committee on Energy and 
     Commerce of the House of Representatives a report, in 
     classified form and unclassified form, that describes the 
     results of each security response evaluation conducted and 
     any relevant corrective action taken by a licensee during the 
     previous year.

     ``SEC. 170E. DESIGN BASIS THREAT RULEMAKING.

       ``a. Rulemaking.--The Commission shall--
       ``(1) not later than 90 days after the date of enactment of 
     this section, initiate a rulemaking proceeding, including 
     notice and opportunity for public comment, to be completed 
     not later than 18 months after that date, to revise the 
     design basis threats of the Commission; or
       ``(2) not later than 18 months after the date of enactment 
     of this section, complete any ongoing rulemaking to revise 
     the design basis threats.
       ``b. Factors.--When conducting its rulemaking, the 
     Commission shall consider the following, but not be limited 
     to--
       ``(1) the events of September 11, 2001;
       ``(2) an assessment of physical, cyber, biochemical, and 
     other terrorist threats;
       ``(3) the potential for attack on facilities by multiple 
     coordinated teams of a large number of individuals;
       ``(4) the potential for assistance in an attack from 
     several persons employed at the facility;
       ``(5) the potential for suicide attacks;
       ``(6) the potential for water-based and air-based threats;
       ``(7) the potential use of explosive devices of 
     considerable size and other modern weaponry;
       ``(8) the potential for attacks by persons with a 
     sophisticated knowledge of facility operations;
       ``(9) the potential for fires, especially fires of long 
     duration;
       ``(10) the potential for attacks on spent fuel shipments by 
     multiple coordinated teams of a large number of individuals;
       ``(11) the adequacy of planning to protect the public 
     health and safety at and around nuclear facilities, as 
     appropriate, in the event of a terrorist attack against a 
     nuclear facility; and
       ``(12) the potential for theft and diversion of nuclear 
     materials from such facilities.''.
       (2) Conforming amendment.--The table of sections of the 
     Atomic Energy Act of 1954 (42 U.S.C. prec. 2011) (as amended 
     by section 624(b)) is amended by adding at the end of the 
     items relating to chapter 14 the following:

``Sec. 170D. Security evaluations.
``Sec. 170E. Design basis threat rulemaking.''.
       (3) Federal security coordinators.--
       (A) Regional offices.--Not later than 18 months after the 
     date of enactment of this Act, the Nuclear Regulatory 
     Commission (referred to in this section as the 
     ``Commission'') shall assign a Federal security coordinator, 
     under the employment of the Commission, to each region of the 
     Commission.
       (B) Responsibilities.--The Federal security coordinator 
     shall be responsible for--
       (i) communicating with the Commission and other Federal, 
     State, and local authorities concerning threats, including 
     threats against such classes of facilities as the Commission 
     determines to be appropriate;
       (ii) monitoring such classes of facilities as the 
     Commission determines to be appropriate to ensure that they 
     maintain security consistent with the security plan in 
     accordance with the appropriate threat level; and
       (iii) assisting in the coordination of security measures 
     among the private security forces at such classes of 
     facilities as the Commission determines to be appropriate and 
     Federal, State, and local authorities, as appropriate.
       (b) Backup Power for Certain Emergency Notification 
     Systems.--For any licensed nuclear power plants located where 
     there is a permanent population, as determined by the 2000 
     decennial census, in excess of 15,000,000 within a 50-mile 
     radius of the power plant, not later than 18 months after 
     enactment of this Act, the Commission shall require that 
     backup power to be available for the emergency notification 
     system of the power plant, including the emergency siren 
     warning system, if the alternating current supply within the 
     10-mile emergency planning zone of the power plant is lost.
       (c) Additional Provisions.--
       (1) Provision of support to university nuclear safety, 
     security, and environmental protection programs.--Section 31 
     b. of the Atomic Energy Act of 1954 (42 U.S.C. 2051(b)) is 
     amended--
       (A) by striking ``b. The Commission is further authorized 
     to make'' and inserting the following:
       ``b. Grants and Contributions.--The Commission is 
     authorized--
       ``(1) to make'';
       (B) in paragraph (1) (as designated by subparagraph (A)) by 
     striking the period at the end and inserting ``; and''; and
       (C) by adding at the end the following:
       ``(2) to provide grants, loans, cooperative agreements, 
     contracts, and equipment to institutions of higher education 
     (as defined in section 102 of the Higher Education Act of 
     1965 (20 U.S.C. 1002)) to support courses, studies, training, 
     curricula, and disciplines pertaining to nuclear safety, 
     security, or environmental protection, or any other field 
     that the Commission determines to be critical to the 
     regulatory mission of the Commission.''.

[[Page 17851]]

       (2) Recruitment tools.--Chapter 14 of the Atomic Energy Act 
     of 1954 (42 U.S.C. 2201 et seq.) (as amended by subsection 
     (a)(1)) is amended by adding at the end the following:

     ``SEC. 170F. RECRUITMENT TOOLS.

       ``The Commission may purchase promotional items of nominal 
     value for use in the recruitment of individuals for 
     employment.''.
       (3) Expenses authorized to be paid by the commission.--
     Chapter 14 of the Atomic Energy Act of 1954 (42 U.S.C. 2201 
     et seq.) (as amended by paragraph (2)) is amended by adding 
     at the end the following:

     ``SEC. 170G. EXPENSES AUTHORIZED TO BE PAID BY THE 
                   COMMISSION.

       ``The Commission may--
       ``(1) pay transportation, lodging, and subsistence expenses 
     of employees who--
       ``(A) assist scientific, professional, administrative, or 
     technical employees of the Commission; and
       ``(B) are students in good standing at an institution of 
     higher education (as defined in section 102 of the Higher 
     Education Act of 1965 (20 U.S.C. 1002)) pursuing courses 
     related to the field in which the students are employed by 
     the Commission; and
       ``(2) pay the costs of health and medical services 
     furnished, pursuant to an agreement between the Commission 
     and the Department of State, to employees of the Commission 
     and dependents of the employees serving in foreign 
     countries.''.
       (4) Partnership program with institutions of higher 
     education.--
       (A) In general.--Chapter 19 of the Atomic Energy Act of 
     1954 (42 U.S.C. 2015 et seq.) (as amended by section 622(a)) 
     is amended by inserting after section 243 the following:

     ``SEC. 244. PARTNERSHIP PROGRAM WITH INSTITUTIONS OF HIGHER 
                   EDUCATION.

       ``a. Definitions.--In this section:
       ``(1) Hispanic-serving institution.--The term `Hispanic-
     serving institution' has the meaning given the term in 
     section 502(a) of the Higher Education Act of 1965 (20 U.S.C. 
     1101a(a)).
       ``(2) Historically black college and university.--The term 
     `historically Black college or university' has the meaning 
     given the term `part B institution' in section 322 of the 
     Higher Education Act of 1965 (20 U.S.C. 1061).
       ``(3) Tribal college.--The term `Tribal college' has the 
     meaning given the term `tribally controlled college or 
     university' in section 2(a) of the Tribally Controlled 
     College or University Assistance Act of 1978 (25 U.S.C. 
     1801(a)).
       ``b. Partnership Program.--The Commission may establish and 
     participate in activities relating to research, mentoring, 
     instruction, and training with institutions of higher 
     education, including Hispanic-serving institutions, 
     historically Black colleges or universities, and Tribal 
     colleges, to strengthen the capacity of the institutions--
       ``(1) to educate and train students (including present or 
     potential employees of the Commission); and
       ``(2) to conduct research in the field of science, 
     engineering, or law, or any other field that the Commission 
     determines is important to the work of the Commission.''.
       (5) Conforming amendments.--The table of sections of the 
     Atomic Energy Act of 1954 (42 U.S.C. prec. 2011) (as amended 
     by subsection (a)(2)) is amended--
       (A) by adding at the end of the items relating to chapter 
     14 the following:

``Sec. 170F. Recruitment tools.
``Sec. 170G. Expenses authorized to be paid by the Commission.''; and
       (B) by inserting after the item relating to section 243 the 
     following:

``Sec. 244. Partnership program with institutions of higher 
              education.''.
       (d) Radiation Source Protection.--
       (1) Amendment.--Chapter 14 of the Atomic Energy Act of 1954 
     (42 U.S.C. 2201 et seq.) (as amended by subsection (c)(3)) is 
     amended by adding at the end the following:

     ``SEC. 170H. RADIATION SOURCE PROTECTION.

       ``a. Definitions.--In this section:
       ``(1) Code of conduct.--The term `Code of Conduct' means 
     the code entitled the `Code of Conduct on the Safety and 
     Security of Radioactive Sources', approved by the Board of 
     Governors of the International Atomic Energy Agency and dated 
     September 8, 2003.
       ``(2) Radiation source.--The term `radiation source' 
     means--
       ``(A) a Category 1 Source or a Category 2 Source, as 
     defined in the Code of Conduct; and
       ``(B) any other material that poses a threat such that the 
     material is subject to this section, as determined by the 
     Commission, by regulation, other than spent nuclear fuel and 
     special nuclear materials.
       ``b. Commission Approval.--Not later than 180 days after 
     the date of enactment of this section, the Commission shall 
     issue regulations prohibiting a person from--
       ``(1) exporting a radiation source, unless the Commission 
     has specifically determined under section 57 or 82, 
     consistent with the Code of Conduct, with respect to the 
     exportation, that--
       ``(A) the recipient of the radiation source may receive and 
     possess the radiation source under the laws and regulations 
     of the country of the recipient;
       ``(B) the recipient country has the appropriate technical 
     and administrative capability, resources, and regulatory 
     structure to ensure that the radiation source will be managed 
     in a safe and secure manner; and
       ``(C) before the date on which the radiation source is 
     shipped--
       ``(i) a notification has been provided to the recipient 
     country; and
       ``(ii) a notification has been received from the recipient 
     country;
     as the Commission determines to be appropriate;
       ``(2) importing a radiation source, unless the Commission 
     has determined, with respect to the importation, that--
       ``(A) the proposed recipient is authorized by law to 
     receive the radiation source; and
       ``(B) the shipment will be made in accordance with any 
     applicable Federal or State law or regulation; and
       ``(3) selling or otherwise transferring ownership of a 
     radiation source, unless the Commission--
       ``(A) has determined that the licensee has verified that 
     the proposed recipient is authorized under law to receive the 
     radiation source; and
       ``(B) has required that the transfer shall be made in 
     accordance with any applicable Federal or State law or 
     regulation.
       ``c. Tracking System.--(1)(A) Not later than 1 year after 
     the date of enactment of this section, the Commission shall 
     issue regulations establishing a mandatory tracking system 
     for radiation sources in the United States.
       ``(B) In establishing the tracking system under 
     subparagraph (A), the Commission shall coordinate with the 
     Secretary of Transportation to ensure compatibility, to the 
     maximum extent practicable, between the tracking system and 
     any system established by the Secretary of Transportation to 
     track the shipment of radiation sources.
       ``(2) The tracking system under paragraph (1) shall--
       ``(A) enable the identification of each radiation source by 
     serial number or other unique identifier;
       ``(B) require reporting within 7 days of any change of 
     possession of a radiation source;
       ``(C) require reporting within 24 hours of any loss of 
     control of, or accountability for, a radiation source; and
       ``(D) provide for reporting under subparagraphs (B) and (C) 
     through a secure Internet connection.
       ``d. Penalty.--A violation of a regulation issued under 
     subsection a. or b. shall be punishable by a civil penalty 
     not to exceed $1,000,000.
       ``e. National Academy of Sciences Study.--(1) Not later 
     than 60 days after the date of enactment of this section, the 
     Commission shall enter into an arrangement with the National 
     Academy of Sciences under which the National Academy of 
     Sciences shall conduct a study of industrial, research, and 
     commercial uses for radiation sources.
       ``(2) The study under paragraph (1) shall include a review 
     of uses of radiation sources in existence on the date on 
     which the study is conducted, including an identification of 
     any industrial or other process that--
       ``(A) uses a radiation source that could be replaced with 
     an economically and technically equivalent (or improved) 
     process that does not require the use of a radiation source; 
     or
       ``(B) may be used with a radiation source that would pose a 
     lower risk to public health and safety in the event of an 
     accident or attack involving the radiation source.
       ``(3) Not later than 2 years after the date of enactment of 
     this section, the Commission shall submit to Congress the 
     results of the study under paragraph (1).
       ``f. Task Force on Radiation Source Protection and 
     Security.--(1) There is established a task force on radiation 
     source protection and security (referred to in this section 
     as the `task force').
       ``(2)(A) The chairperson of the task force shall be the 
     Chairperson of the Commission (or a designee).
       ``(B) The membership of the task force shall consist of the 
     following:
       ``(i) The Secretary of Homeland Security (or a designee).
       ``(ii) The Secretary of Defense (or a designee).
       ``(iii) The Secretary of Energy (or a designee).
       ``(iv) The Secretary of Transportation (or a designee).
       ``(v) The Attorney General (or a designee).
       ``(vi) The Secretary of State (or a designee).
       ``(vii) The Director of National Intelligence (or a 
     designee).
       ``(viii) The Director of the Central Intelligence Agency 
     (or a designee).
       ``(ix) The Director of the Federal Emergency Management 
     Agency (or a designee).
       ``(x) The Director of the Federal Bureau of Investigation 
     (or a designee).
       ``(xi) The Administrator of the Environmental Protection 
     Agency (or a designee).
       ``(3)(A) The task force, in consultation with Federal, 
     State, and local agencies, the Conference of Radiation 
     Control Program Directors, and the Organization of Agreement 
     States, and after public notice and an opportunity for 
     comment, shall evaluate, and provide recommendations relating 
     to, the security of radiation sources in the United States 
     from potential terrorist threats, including acts of sabotage, 
     theft, or use of a radiation source in a radiological 
     dispersal device.
       ``(B) Not later than 1 year after the date of enactment of 
     this section, and not less than once every 4 years 
     thereafter, the task force shall submit to Congress and the 
     President a report, in unclassified form with a classified 
     annex if necessary, providing recommendations, including 
     recommendations for appropriate regulatory and legislative 
     changes, for--
       ``(i) a list of additional radiation sources that should be 
     required to be secured under this Act,

[[Page 17852]]

     based on the potential attractiveness of the sources to 
     terrorists and the extent of the threat to public health and 
     safety of the sources, taking into consideration--
       ``(I) radiation source radioactivity levels;
       ``(II) radioactive half-life of a radiation source;
       ``(III) dispersability;
       ``(IV) chemical and material form;
       ``(V) for radioactive materials with a medical use, the 
     availability of the sources to physicians and patients for 
     medical treatment; and
       ``(VI) any other factor that the Chairperson of the 
     Commission determines to be appropriate;
       ``(ii) the establishment of, or modifications to, a 
     national system for recovery of lost or stolen radiation 
     sources;
       ``(iii) the storage of radiation sources that are not used 
     in a safe and secure manner as of the date on which the 
     report is submitted;
       ``(iv) modifications to the national tracking system for 
     radiation sources;
       ``(v) the establishment of, or modifications to, a national 
     system (including user fees and other methods) to provide for 
     the proper disposal of radiation sources secured under this 
     Act;
       ``(vi) modifications to export controls on radiation 
     sources to ensure that foreign recipients of radiation 
     sources are able and willing to adequately control radiation 
     sources from the United States;
       ``(vii)(I) any alternative technologies available as of the 
     date on which the report is submitted that may perform some 
     or all of the functions performed by devices or processes 
     that employ radiation sources; and
       ``(II) the establishment of appropriate regulations and 
     incentives for the replacement of the devices and processes 
     described in subclause (I)--
       ``(aa) with alternative technologies in order to reduce the 
     number of radiation sources in the United States; or
       ``(bb) with radiation sources that would pose a lower risk 
     to public health and safety in the event of an accident or 
     attack involving the radiation source; and
       ``(viii) the creation of, or modifications to, procedures 
     for improving the security of use, transportation, and 
     storage of radiation sources, including--
       ``(I) periodic audits or inspections by the Commission to 
     ensure that radiation sources are properly secured and can be 
     fully accounted for;
       ``(II) evaluation of the security measures by the 
     Commission;
       ``(III) increased fines for violations of Commission 
     regulations relating to security and safety measures 
     applicable to licensees that possess radiation sources;
       ``(IV) criminal and security background checks for certain 
     individuals with access to radiation sources (including 
     individuals involved with transporting radiation sources);
       ``(V) requirements for effective and timely exchanges of 
     information relating to the results of criminal and security 
     background checks between the Commission and any State with 
     which the Commission has entered into an agreement under 
     section 274 b.;
       ``(VI) assurances of the physical security of facilities 
     that contain radiation sources (including facilities used to 
     temporarily store radiation sources being transported); and
       ``(VII) the screening of shipments to facilities that the 
     Commission determines to be particularly at risk for sabotage 
     of radiation sources to ensure that the shipments do not 
     contain explosives.
       ``g. Action by Commission.--Not later than 60 days after 
     the date of receipt by Congress and the President of a report 
     under subsection f.(3)(B), the Commission, in accordance with 
     the recommendations of the task force, shall--
       ``(1) take any action the Commission determines to be 
     appropriate, including revising the system of the Commission 
     for licensing radiation sources; and
       ``(2) ensure that States that have entered into agreements 
     with the Commission under section 274 b. take similar action 
     in a timely manner.''.
       (2) Conforming amendment.--The table of sections of the 
     Atomic Energy Act of 1954 (42 U.S.C. prec. 2011) (as amended 
     by subsection (c)(5)(A)) is amended by adding at the end of 
     the items relating to chapter 14 the following:

``Sec. 170H. Radiation source protection.''.

       (e) Treatment of Accelerator-produced and Other Radioactive 
     Material as Byproduct Material.--
       (1) Definition of byproduct material.--Section 11 e. of the 
     Atomic Energy Act of 1954 (42 U.S.C. 2014(e)) is amended--
       (A) by striking ``means (1) any radioactive'' and inserting 
     the following: ``means--
       ``(1) any radioactive''.
       (B) by striking ``material, and (2) the tailings'' and 
     inserting the following: ``material;
       ``(2) the tailings''.
       (C) by striking ``content.'' and inserting the following: 
     ``content;
       ``(3)(A) any discrete source of radium-226 that is 
     produced, extracted, or converted after extraction, before, 
     on, or after the date of enactment of this paragraph for use 
     for a commercial, medical, or research activity; or
       ``(B) any material that--
       ``(i) has been made radioactive by use of a particle 
     accelerator; and
       ``(ii) is produced, extracted, or converted after 
     extraction, before, on, or after the date of enactment of 
     this paragraph for use for a commercial, medical, or research 
     activity; and
       ``(4) any discrete source of naturally occurring 
     radioactive material, other than source material, that--
       ``(A) the Commission, in consultation with the 
     Administrator of the Environmental Protection Agency, the 
     Secretary of Energy, the Secretary of Homeland Security, and 
     the head of any other appropriate Federal agency, determines 
     would pose a threat similar to the threat posed by a discrete 
     source of radium-226 to the public health and safety or the 
     common defense and security; and
       ``(B) before, on, or after the date of enactment of this 
     paragraph is extracted or converted after extraction for use 
     in a commercial, medical, or research activity.''.
       (2) Agreements with governors.--Section 274 b. of the 
     Atomic Energy Act of 1954 (42 U.S.C. 2021(b)) is amended by 
     striking 
     ``State--'' and all that follows through paragraph (4) and 
     inserting the following: ``State:
       ``(1) Byproduct materials (as defined in section 11 e.).
       ``(2) Source materials.
       ``(3) Special nuclear materials in quantities not 
     sufficient to form a critical mass.''.
       (3) Waste disposal.--
       (A) Domestic distribution.--Section 81 of the Atomic Energy 
     Act of 1954 (42 U.S.C. 2111) is amended--
       (i) by striking ``No person may'' and inserting the 
     following:
       ``a. In General.--No person may''.
       (ii) by adding at the end the following:
       ``b. Requirements.--
       ``(1) In general.--Except as provided in paragraph (2), 
     byproduct material, as defined in paragraphs (3) and (4) of 
     section 11 e., may only be transferred to and disposed of in 
     a disposal facility that--
       ``(A) is adequate to protect public health and safety; and
       ``(B)(i) is licensed by the Commission; or
       ``(ii) is licensed by a State that has entered into an 
     agreement with the Commission under section 274 b., if the 
     licensing requirements of the State are compatible with the 
     licensing requirements of the Commission.
       ``(2) Effect of subsection.--Nothing in this subsection 
     affects the authority of any entity to dispose of byproduct 
     material, as defined in paragraphs (3) and (4) of section 11 
     e., at a disposal facility in accordance with any Federal or 
     State solid or hazardous waste law, including the Solid Waste 
     Disposal Act (42 U.S.C. 6901 et seq.).
       ``c. Treatment as Low-level Radioactive Waste.--Byproduct 
     material, as defined in paragraphs (3) and (4) of section 11 
     e., disposed of under this section shall not be considered to 
     be low-level radioactive waste for the purposes of--
       ``(1) section 2 of the Low-Level Radioactive Waste Policy 
     Act (42 U.S.C. 2021b); or
       ``(2) carrying out a compact that is--
       ``(A) entered into in accordance with that Act (42 U.S.C. 
     2021b et seq.); and
       ``(B) approved by Congress.''.
       (B) Definition of low-level radioactive waste.--Section 
     2(9) of the Low-Level Radioactive Waste Policy Act (42 U.S.C. 
     2021b(9)) is amended--
       (i) by redesignating subparagraphs (A) and (B) as clauses 
     (i) and (ii), respectively, and indenting the clauses 
     appropriately;
       (ii) in the matter preceding clause (i) (as redesignated by 
     subparagraph (A)) by striking ``The term'' and inserting the 
     following:
       ``(A) In general.--The term''; and
       (iii) by adding at the end the following:
       ``(B) Exclusion.--The term `low-level radioactive waste' 
     does not include byproduct material (as defined in paragraphs 
     (3) and (4) of section 11 e. of the Atomic Energy Act of 1954 
     (42 U.S.C. 2014(e)).''.
       (4) Final regulations.--
       (A) Regulations.--
       (i) In general.--Not later than 18 months after the date of 
     enactment of this Act, the Commission, after consultation 
     with States and other stakeholders, shall issue final 
     regulations establishing such requirements as the Commission 
     determines to be necessary to carry out this section and the 
     amendments made by this section.
       (ii) Inclusions.--The regulations shall include a 
     definition of the term ``discrete source'' for purposes of 
     paragraphs (3) and (4) of section 11 e. of the Atomic Energy 
     Act of 1954 (42 U.S.C. 2014(e)) (as amended by paragraph 
     (1)).
       (B) Cooperation.--In promulgating regulations under 
     paragraph (1), the Commission shall, to the maximum extent 
     practicable--
       (i) cooperate with States; and
       (ii) use model State standards in existence on the date of 
     enactment of this Act.
       (C) Transition plan.--
       (i) Definition of byproduct material.--In this paragraph, 
     the term ``byproduct material'' has the meaning given the 
     term in paragraphs (3) and (4) of section 11 e. of the Atomic 
     Energy Act of 1954 (42 U.S.C. 2014(e)) (as amended by 
     paragraph (1)).
       (ii) Preparation and publication.--To facilitate an orderly 
     transition of regulatory authority with respect to byproduct 
     material, the Commission, in issuing regulations under 
     subparagraph (A), shall prepare and publish a transition plan 
     for--

       (I) States that have not, before the date on which the plan 
     is published, entered into an agreement with the Commission 
     under section 274 b. of the Atomic Energy Act of 1954 (42 
     U.S.C. 2021(b)); and
       (II) States that have entered into an agreement with the 
     Commission under that section before the date on which the 
     plan is published.

       (iii) Inclusions.--The transition plan under clause (ii) 
     shall include--

[[Page 17853]]

       (I) a description of the conditions under which a State may 
     exercise authority over byproduct material; and
       (II) a statement of the Commission that any agreement 
     covering byproduct material, as defined in paragraph (1) or 
     (2) of section 11e. of the Atomic Energy Act of 1954 (42 
     U.S.C. 2014(e)), entered into between the Commission and a 
     State under section 274 b. of that Act (42 U.S.C. 2021(b)) 
     before the date of publication of the transition plan shall 
     be considered to include byproduct material, as defined in 
     paragraph (3) or (4) of section 11e. of that Act (42 U.S.C. 
     2014(e)) (as amended by paragraph (1)), if the Governor of 
     the State certifies to the Commission on the date of 
     publication of the transition plan that--

       (aa) the State has a program for licensing byproduct 
     material, as defined in paragraph (3) or (4) of section 11e. 
     of the Atomic Energy Act of 1954, that is adequate to protect 
     the public health and safety, as determined by the 
     Commission; and
       (bb) the State intends to continue to implement the 
     regulatory responsibility of the State with respect to the 
     byproduct material.
       (D) Availability of radiopharmaceuticals.--In promulgating 
     regulations under subparagraph (A), the Commission shall 
     consider the impact on the availability of 
     radiopharmaceuticals to--
       (i) physicians; and
       (ii) patients the medical treatment of which relies on 
     radiopharmaceuticals.
       (5) Waivers.--
       (A) In general.--Except as provided in subparagraph (B), 
     the Commission may grant a waiver to any entity of any 
     requirement under this section or an amendment made by this 
     section with respect to a matter relating to byproduct 
     material (as defined in paragraphs (3) and (4) of section 11 
     e. of the Atomic Energy Act of 1954 (42 U.S.C. 2014(e)) (as 
     amended by paragraph (1))) if the Commission determines that 
     the waiver is in accordance with the protection of the public 
     health and safety and the promotion of the common defense and 
     security.
       (B) Exceptions.--
       (i) In general.--The Commission may not grant a waiver 
     under subparagraph (A) with respect to--

       (I) any requirement under the amendments made by subsection 
     (c)(1);
       (II) a matter relating to an importation into, or 
     exportation from, the United States for a period ending after 
     the date that is 1 year after the date of enactment of this 
     Act; or
       (III) any other matter for a period ending after the date 
     that is 4 years after the date of enactment of this Act.

       (ii) Waivers to states.--The Commission shall terminate any 
     waiver granted to a State under subparagraph (A) if the 
     Commission determines that--

       (I) the State has entered into an agreement with the 
     Commission under section 274 b. of the Atomic Energy Act of 
     1954 (42 U.S.C. 2021(b));
       (II) the agreement described in subclause (I) covers 
     byproduct material (as described in paragraph (3) or (4) of 
     section 11 e. of the Atomic Energy Act of 1954 (42 U.S.C. 
     2014(e)) (as amended by paragraph (1))); and
       (III) the program of the State for licensing such byproduct 
     material is adequate to protect the public health and safety.

       (C) Publication.--The Commission shall publish in the 
     Federal Register a notice of any waiver granted under this 
     subsection.

     SEC. 652. FINGERPRINTING AND CRIMINAL HISTORY RECORD CHECKS.

       Section 149 of the Atomic Energy Act of 1954 (42 U.S.C. 
     2169) is amended--
       (1) in subsection a.--
       (A) by striking ``a. The Nuclear'' and all that follows 
     through ``section 147.'' and inserting the following:
       ``a.(1)(A)(i) The Commission shall require each individual 
     or entity described in clause (ii) to fingerprint each 
     individual described in subparagraph (B) before the 
     individual described in subparagraph (B) is permitted access 
     under subparagraph (B).
       ``(ii) The individuals and entities referred to in clause 
     (i) are individuals and entities that, on or before the date 
     on which an individual is permitted access under subparagraph 
     (B)--
       ``(I) are licensed or certified to engage in an activity 
     subject to regulation by the Commission;
       ``(II) have filed an application for a license or 
     certificate to engage in an activity subject to regulation by 
     the Commission; or
       ``(III) have notified the Commission in writing of an 
     intent to file an application for licensing, certification, 
     permitting, or approval of a product or activity subject to 
     regulation by the Commission.
       ``(B) The Commission shall require to be fingerprinted any 
     individual who--
       ``(i) is permitted unescorted access to--
       ``(I) a utilization facility; or
       ``(II) radioactive material or other property subject to 
     regulation by the Commission that the Commission determines 
     to be of such significance to the public health and safety or 
     the common defense and security as to warrant fingerprinting 
     and background checks; or
       ``(ii) is permitted access to safeguards information under 
     section 147.'';
       (B) by striking ``All fingerprints obtained by a licensee 
     or applicant as required in the preceding sentence'' and 
     inserting the following:
       ``(2) All fingerprints obtained by an individual or entity 
     as required in paragraph (1)'';
       (C) by striking ``The costs of any identification and 
     records check conducted pursuant to the preceding sentence 
     shall be paid by the licensee or applicant.'' and inserting 
     the following:
       ``(3) The costs of an identification or records check under 
     paragraph (2) shall be paid by the individual or entity 
     required to conduct the fingerprinting under paragraph 
     (1)(A).''; and
       (D) by striking ``Notwithstanding any other provision of 
     law, the Attorney General may provide all the results of the 
     search to the Commission, and, in accordance with regulations 
     prescribed under this section, the Commission may provide 
     such results to licensee or applicant submitting such 
     fingerprints.'' and inserting the following:
       ``(4) Notwithstanding any other provision of law--
       ``(A) the Attorney General may provide any result of an 
     identification or records check under paragraph (2) to the 
     Commission; and
       ``(B) the Commission, in accordance with regulations 
     prescribed under this section, may provide the results to the 
     individual or entity required to conduct the fingerprinting 
     under paragraph (1)(A).'';
       (2) in subsection c.--
       (A) by striking ``, subject to public notice and comment, 
     regulations--'' and inserting ``requirements--''; and
       (B) in paragraph (2)(B), by striking ``unescorted access to 
     the facility of a licensee or applicant'' and inserting 
     ``unescorted access to a utilization facility, radioactive 
     material, or other property described in subsection 
     a.(1)(B)'';
       (3) by redesignating subsection d. as subsection e.; and
       (4) by inserting after subsection c. the following:
       ``d. The Commission may require a person or individual to 
     conduct fingerprinting under subsection a.(1) by authorizing 
     or requiring the use of any alternative biometric method for 
     identification that has been approved by--
       ``(1) the Attorney General; and
       ``(2) the Commission, by regulation.''.

     SEC. 653. USE OF FIREARMS BY SECURITY PERSONNEL.

       The Atomic Energy Act of 1954 is amended by inserting after 
     section 161 (42 U.S.C. 2201) the following:

     ``SEC. 161A. USE OF FIREARMS BY SECURITY PERSONNEL.

       ``a. Definitions.--In this section, the terms `handgun', 
     `rifle', `shotgun', `firearm', `ammunition', `machinegun', 
     `short-barreled shotgun', and `short-barreled rifle' have the 
     meanings given the terms in section 921(a) of title 18, 
     United States Code.
       ``b. Authorization.--Notwithstanding subsections (a)(4), 
     (a)(5), (b)(2), (b)(4), and (o) of section 922 of title 18, 
     United States Code, section 925(d)(3) of title 18, United 
     States Code, section 5844 of the Internal Revenue Code of 
     1986, and any law (including regulations) of a State or a 
     political subdivision of a State that prohibits the transfer, 
     receipt, possession, transportation, importation, or use of a 
     handgun, a rifle, a shotgun, a short-barreled shotgun, a 
     short-barreled rifle, a machinegun, a semiautomatic assault 
     weapon, ammunition for any such gun or weapon, or a large 
     capacity ammunition feeding device, in carrying out the 
     duties of the Commission, the Commission may authorize the 
     security personnel of any licensee or certificate holder of 
     the Commission (including an employee of a contractor of such 
     a licensee or certificate holder) to transfer, receive, 
     possess, transport, import, and use 1 or more such guns, 
     weapons, ammunition, or devices, if the Commission determines 
     that--
       ``(1) the authorization is necessary to the discharge of 
     the official duties of the security personnel; and
       ``(2) the security personnel--
       ``(A) are not otherwise prohibited from possessing or 
     receiving a firearm under Federal or State laws relating to 
     possession of firearms by a certain category of persons;
       ``(B) have successfully completed any requirement under 
     this section for training in the use of firearms and tactical 
     maneuvers;
       ``(C) are engaged in the protection of--
       ``(i) a facility owned or operated by a licensee or 
     certificate holder of the Commission that is designated by 
     the Commission; or
       ``(ii) radioactive material or other property owned or 
     possessed by a licensee or certificate holder of the 
     Commission, or that is being transported to or from a 
     facility owned or operated by such a licensee or certificate 
     holder, and that has been determined by the Commission to be 
     of significance to the common defense and security or public 
     health and safety; and
       ``(D) are discharging the official duties of the security 
     personnel in transferring, receiving, possessing, 
     transporting, or importing the weapons, ammunition, or 
     devices.
       ``c. Background Checks.--A person that receives, possesses, 
     transports, imports, or uses a weapon, ammunition, or a 
     device under subsection (b) shall be subject to a background 
     check by the Attorney General, based on fingerprints and 
     including a background check under section 103(b) of the 
     Brady Handgun Violence Prevention Act (Public Law 103-159; 18 
     U.S.C. 922 note) to determine whether the person is 
     prohibited from possessing or receiving a firearm under 
     Federal or State law.
       ``d. Effective Date.--This section takes effect on the date 
     on which guidelines are issued by the Commission, with the 
     approval of the Attorney General, to carry out this 
     section.''

     SEC. 654. UNAUTHORIZED INTRODUCTION OF DANGEROUS WEAPONS.

       Section 229 of the Atomic Energy Act of 1954 (42 U.S.C. 
     2278a) is amended--
       (1) by striking ``Sec. 229, Trespass Upon Commission 
     Installations.--'' and inserting the following:

[[Page 17854]]



     ``SEC. 229. TRESPASS ON COMMISSION INSTALLATIONS.'';

       (2) by adjusting the indentations of subsections a., b., 
     and c. so as to reflect proper subsection indentations; and
       (3) in subsection a.--
       (A) in the first sentence, by striking ``a. The'' and 
     inserting the following:
       ``a.(1) The'';
       (B) in the second sentence, by striking ``Every'' and 
     inserting the following:
       ``(2) Every''; and
       (C) in paragraph (1) (as designated by subparagraph (A))--
       (i) by striking ``or in the custody'' and inserting ``in 
     the custody''; and
       (ii) by inserting ``, or subject to the licensing authority 
     of the Commission or certification by the Commission under 
     this Act or any other Act'' before the period.

     SEC. 655. SABOTAGE OF NUCLEAR FACILITIES, FUEL, OR DESIGNATED 
                   MATERIAL.

       (a) In General.--Section 236a. of the Atomic Energy Act of 
     1954 (42 U.S.C. 2284(a)) is amended--
       (1) in paragraph (2), by striking ``storage facility'' and 
     inserting ``treatment, storage, or disposal facility'';
       (2) in paragraph (3)--
       (A) by striking ``such a utilization facility'' and 
     inserting ``a utilization facility licensed under this Act''; 
     and
       (B) by striking ``or'' at the end;
       (3) in paragraph (4)--
       (A) by striking ``facility licensed'' and inserting ``, 
     uranium conversion, or nuclear fuel fabrication facility 
     licensed or certified''; and
       (B) by striking the comma at the end and inserting a 
     semicolon; and
       (4) by inserting after paragraph (4) the following:
       ``(5) any production, utilization, waste storage, waste 
     treatment, waste disposal, uranium enrichment, uranium 
     conversion, or nuclear fuel fabrication facility subject to 
     licensing or certification under this Act during construction 
     of the facility, if the destruction or damage caused or 
     attempted to be caused could adversely affect public health 
     and safety during the operation of the facility;
       ``(6) any primary facility or backup facility from which a 
     radiological emergency preparedness alert and warning system 
     is activated; or
       ``(7) any radioactive material or other property subject to 
     regulation by the Commission that, before the date of the 
     offense, the Commission determines, by order or regulation 
     published in the Federal Register, is of significance to the 
     public health and safety or to common defense and 
     security;''.
       (b) Conforming Amendment.--Section 236 of the Atomic Energy 
     Act of 1954 (42 U.S.C. 2284) is amended by striking 
     ``intentionally and willfully'' each place it appears and 
     inserting ``knowingly''.

     SEC. 656. SECURE TRANSFER OF NUCLEAR MATERIALS.

       (a) Amendment.--Chapter 14 of the Atomic Energy Act of 1954 
     (42 U.S.C. 2201-2210b) (as amended by section 651(d)(1)) is 
     amended by adding at the end the following new section:

     ``SEC. 170I. SECURE TRANSFER OF NUCLEAR MATERIALS.

       ``a. The Commission shall establish a system to ensure that 
     materials described in subsection b., when transferred or 
     received in the United States by any party pursuant to an 
     import or export license issued pursuant to this Act, are 
     accompanied by a manifest describing the type and amount of 
     materials being transferred or received. Each individual 
     receiving or accompanying the transfer of such materials 
     shall be subject to a security background check conducted by 
     appropriate Federal entities.
       ``b. Except as otherwise provided by the Commission by 
     regulation, the materials referred to in subsection a. are 
     byproduct materials, source materials, special nuclear 
     materials, high-level radioactive waste, spent nuclear fuel, 
     transuranic waste, and low-level radioactive waste (as 
     defined in section 2(16) of the Nuclear Waste Policy Act of 
     1982 (42 U.S.C. 10101(16))).''.
       (b) Regulations.--Not later than 1 year after the date of 
     the enactment of this Act, and from time to time thereafter 
     as it considers necessary, the Nuclear Regulatory Commission 
     shall issue regulations identifying radioactive materials or 
     classes of individuals that, consistent with the protection 
     of public health and safety and the common defense and 
     security, are appropriate exceptions to the requirements of 
     section 170D of the Atomic Energy Act of 1954, as added by 
     subsection (a) of this section.
       (c) Effective Date.--The amendment made by subsection (a) 
     shall take effect upon the issuance of regulations under 
     subsection (b), except that the background check requirement 
     shall become effective on a date established by the 
     Commission.
       (d) Effect on Other Law.--Nothing in this section or the 
     amendment made by this section shall waive, modify, or affect 
     the application of chapter 51 of title 49, United States 
     Code, part A of subtitle V of title 49, United States Code, 
     part B of subtitle VI of title 49, United States Code, and 
     title 23, United States Code.
       (e) Conforming Amendment.--The table of sections of the 
     Atomic Energy Act of 1954 (42 U.S.C. prec. 2011) (as amended 
     by subsection (a)) is amended by adding at the end of the 
     items relating to chapter 14 the following:

``Sec. 170I. Secure transfer of nuclear materials.''.

     SEC. 657. DEPARTMENT OF HOMELAND SECURITY CONSULTATION.

       Before issuing a license for a utilization facility, the 
     Nuclear Regulatory Commission shall consult with the 
     Department of Homeland Security concerning the potential 
     vulnerabilities of the location of the proposed facility to 
     terrorist attack.
                     TITLE VII--VEHICLES AND FUELS
                     Subtitle A--Existing Programs

     SEC. 701. USE OF ALTERNATIVE FUELS BY DUAL FUELED VEHICLES.

       Section 400AA(a)(3)(E) of the Energy Policy and 
     Conservation Act (42 U.S.C. 6374(a)(3)(E)) is amended to read 
     as follows:
       ``(E)(i) Dual fueled vehicles acquired pursuant to this 
     section shall be operated on alternative fuels unless the 
     Secretary determines that an agency qualifies for a waiver of 
     such requirement for vehicles operated by the agency in a 
     particular geographic area in which--
       ``(I) the alternative fuel otherwise required to be used in 
     the vehicle is not reasonably available to retail purchasers 
     of the fuel, as certified to the Secretary by the head of the 
     agency; or
       ``(II) the cost of the alternative fuel otherwise required 
     to be used in the vehicle is unreasonably more expensive 
     compared to gasoline, as certified to the Secretary by the 
     head of the agency.
       ``(III) The Secretary shall monitor compliance with this 
     subparagraph by all such fleets and shall report annually to 
     Congress on the extent to which the requirements of this 
     subparagraph are being achieved. The report shall include 
     information on annual reductions achieved from the use of 
     petroleum-based fuels and the problems, if any, encountered 
     in acquiring alternative fuels.''.

     SEC. 702. INCREMENTAL COST ALLOCATION.

       Section 303(c) of the Energy Policy Act of 1992 (42 U.S.C. 
     13212(c)) is amended by striking ``may'' and inserting 
     ``shall''.

     SEC. 703. ALTERNATIVE COMPLIANCE AND FLEXIBILITY.

       (a) Alternative Compliance.--Title V of the Energy Policy 
     Act of 1992 (42 U.S.C. 13251 et seq.) is amended--
       (1) by redesignating section 514 (42 U.S.C. 13264) as 
     section 515; and
       (2) by inserting after section 513 (42 U.S.C. 13263) the 
     following:

     ``SEC. 514. ALTERNATIVE COMPLIANCE.

       ``(a) Application for Waiver.--Any covered person subject 
     to section 501 and any State subject to section 507(o) may 
     petition the Secretary for a waiver of the applicable 
     requirements of section 501 or 507(o).
       ``(b) Grant of Waiver.--The Secretary shall grant a waiver 
     of the requirements of section 501 or 507(o) on a showing 
     that the fleet owned, operated, leased, or otherwise 
     controlled by the State or covered person--
       ``(1) will achieve a reduction in the annual consumption of 
     petroleum fuels by the fleet equal to--
       ``(A) the reduction in consumption of petroleum that would 
     result from 100 percent cumulative compliance with the fuel 
     use requirements of section 501; or
       ``(B) in the case of an entity covered under section 
     507(o), a reduction equal to the annual consumption by the 
     State entity of alternative fuels if all of the cumulative 
     alternative fuel vehicles of the State entity given credit 
     under section 508 were to use alternative fuel 100 percent of 
     the time; and
       ``(2) is in compliance with all applicable vehicle emission 
     standards established by the Administrator of the 
     Environmental Protection Agency under the Clean Air Act (42 
     U.S.C. 7401 et seq.).
       ``(c) Reporting Requirement.--Not later than December 31 of 
     a model year, any State or covered person granted a waiver 
     under this section for the preceding model year shall submit 
     to the Secretary an annual report that--
       ``(1) certifies the quantity of the petroleum motor fuel 
     reduction of the State or covered person during the preceding 
     model year; and
       ``(2) projects the baseline quantity of the petroleum motor 
     fuel reduction of the State or covered person during the 
     following model year.
       ``(d) Revocation of Waiver.--If a State or covered person 
     that receives a waiver under this section fails to comply 
     with this section, the Secretary--
       ``(1) shall revoke the waiver; and
       ``(2) may impose on the State or covered person a penalty 
     under section 512.''.
       (b) Conforming Amendment.--Section 511 of the Energy Policy 
     Act of 1992 (42 U.S.C. 13261) is amended by striking ``or 
     507'' and inserting ``507, or 514''.
       (c) Table of Contents Amendment.--The table of contents of 
     the Energy Policy Act of 1992 (42 U.S.C. prec. 13201) is 
     amended by striking the item relating to section 514 and 
     inserting the following:

``Sec. 514. Alternative compliance.
``Sec. 515. Authorization of appropriations.''.

     SEC. 704. REVIEW OF ENERGY POLICY ACT OF 1992 PROGRAMS.

       (a) In General.--Not later than 180 days after the date of 
     enactment of this section, the Secretary shall complete a 
     study to determine the effect that titles III, IV, and V of 
     the Energy Policy Act of 1992 (42 U.S.C. 13211 et seq.) have 
     had on--
       (1) the development of alternative fueled vehicle 
     technology;
       (2) the availability of that technology in the market; and
       (3) the cost of alternative fueled vehicles.
       (b) Topics.--As part of the study under subsection (a), the 
     Secretary shall specifically identify--

[[Page 17855]]

       (1) the number of alternative fueled vehicles acquired by 
     fleets or covered persons required to acquire alternative 
     fueled vehicles;
       (2) the quantity, by type, of alternative fuel actually 
     used in alternative fueled vehicles acquired by fleets or 
     covered persons;
       (3) the quantity of petroleum displaced by the use of 
     alternative fuels in alternative fueled vehicles acquired by 
     fleets or covered persons;
       (4) the direct and indirect costs of compliance with 
     requirements under titles III, IV, and V of the Energy Policy 
     Act of 1992 (42 U.S.C. 13211 et seq.), including--
       (A) vehicle acquisition requirements imposed on fleets or 
     covered persons;
       (B) administrative and recordkeeping expenses;
       (C) fuel and fuel infrastructure costs;
       (D) associated training and employee expenses; and
       (E) any other factors or expenses the Secretary determines 
     to be necessary to compile reliable estimates of the overall 
     costs and benefits of complying with programs under those 
     titles for fleets, covered persons, and the national economy;
       (5) the existence of obstacles preventing compliance with 
     vehicle acquisition requirements and increased use of 
     alternative fuel in alternative fueled vehicles acquired by 
     fleets or covered persons; and
       (6) the projected impact of amendments to the Energy Policy 
     Act of 1992 made by this title.
       (c) Report.--Upon completion of the study under this 
     section, the Secretary shall submit to Congress a report that 
     describes the results of the study and includes any 
     recommendations of the Secretary for legislative or 
     administrative changes concerning the alternative fueled 
     vehicle requirements under titles III, IV, and V of the 
     Energy Policy Act of 1992 (42 U.S.C. 13211 et seq.).

     SEC. 705. REPORT CONCERNING COMPLIANCE WITH ALTERNATIVE 
                   FUELED VEHICLE PURCHASING REQUIREMENTS.

       Section 310(b)(1) of the Energy Policy Act of 1992 (42 
     U.S.C. 13218(b)(1)) is amended by striking ``1 year after the 
     date of enactment of this subsection'' and inserting 
     ``February 15, 2006''.

     SEC. 706. JOINT FLEXIBLE FUEL/HYBRID VEHICLE 
                   COMMERCIALIZATION INITIATIVE.

       (a) Definitions.--In this section:
       (1) Eligible entity.--The term eligible entity means--
       (A) a for-profit corporation;
       (B) a nonprofit corporation; or
       (C) an institution of higher education.
       (2) Program.--The term ``program'' means a program 
     established under subsection (b).
       (b) Establishment.--The Secretary shall establish a program 
     to improve technologies for the commercialization of--
       (1) a combination hybrid/flexible fuel vehicle; or
       (2) a plug-in hybrid/flexible fuel vehicle.
       (c) Grants.--In carrying out the program, the Secretary 
     shall provide grants that give preference to proposals that--
       (1) achieve the greatest reduction in miles per gallon of 
     petroleum fuel consumption;
       (2) achieve not less than 250 miles per gallon of petroleum 
     fuel consumption; and
       (3) have the greatest potential of commercialization to the 
     general public within 5 years.
       (d) Verification.--Not later than 90 days after the date of 
     enactment of this Act, the Secretary shall publish in the 
     Federal Register procedures to verify--
       (1) the hybrid/flexible fuel vehicle technologies to be 
     demonstrated; and
       (2) that grants are administered in accordance with this 
     section.
       (e) Report.--Not later than 260 days after the date of 
     enactment of this Act, and annually thereafter, the Secretary 
     shall submit to Congress a report that--
       (1) identifies the grant recipients;
       (2) describes the technologies to be funded under the 
     program;
       (3) assesses the feasibility of the technologies described 
     in paragraph (2) in meeting the goals described in subsection 
     (c);
       (4) identifies applications submitted for the program that 
     were not funded; and
       (5) makes recommendations for Federal legislation to 
     achieve commercialization of the technology demonstrated.
       (f) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section, to remain 
     available until expended--
       (1) $3,000,000 for fiscal year 2006;
       (2) $7,000,000 for fiscal year 2007;
       (3) $10,000,000 for fiscal year 2008; and
       (4) $20,000,000 for fiscal year 2009.

     SEC. 707. EMERGENCY EXEMPTION.

       Section 301 of the Energy Policy Act of 1992 (42 U.S.C. 
     13211) is amended in paragraph (9)(E) by inserting before the 
     semicolon at the end ``, including vehicles directly used in 
     the emergency repair of transmission lines and in the 
     restoration of electricity service following power outages, 
     as determined by the Secretary''.
  Subtitle B--Hybrid Vehicles, Advanced Vehicles, and Fuel Cell Buses

                        PART 1--HYBRID VEHICLES

     SEC. 711. HYBRID VEHICLES.

       The Secretary shall accelerate efforts directed toward the 
     improvement of batteries and other rechargeable energy 
     storage systems, power electronics, hybrid systems 
     integration, and other technologies for use in hybrid 
     vehicles.

     SEC. 712. EFFICIENT HYBRID AND ADVANCED DIESEL VEHICLES.

       (a) Program.--The Secretary shall establish a program to 
     encourage domestic production and sales of efficient hybrid 
     and advanced diesel vehicles. The program shall include 
     grants to automobile manufacturers to encourage domestic 
     production of efficient hybrid and advanced diesel vehicles.
       (b) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary for carrying out this 
     section such sums as may be necessary for each of the fiscal 
     years 2006 through 2015.

                       PART 2--ADVANCED VEHICLES

     SEC. 721. PILOT PROGRAM.

       (a) Establishment.--The Secretary, in consultation with the 
     Secretary of Transportation, shall establish a competitive 
     grant pilot program (referred to in this part as the ``pilot 
     program''), to be administered through the Clean Cities 
     Program of the Department, to provide not more than 30 
     geographically dispersed project grants to State governments, 
     local governments, or metropolitan transportation authorities 
     to carry out a project or projects for the purposes described 
     in subsection (b).
       (b) Grant Purposes.--A grant under this section may be used 
     for the following purposes:
       (1) The acquisition of alternative fueled vehicles or fuel 
     cell vehicles, including--
       (A) passenger vehicles (including neighborhood electric 
     vehicles); and
       (B) motorized 2-wheel bicycles or other vehicles for use by 
     law enforcement personnel or other State or local government 
     or metropolitan transportation authority employees.
       (2) The acquisition of alternative fueled vehicles, hybrid 
     vehicles, or fuel cell vehicles, including--
       (A) buses used for public transportation or transportation 
     to and from schools;
       (B) delivery vehicles for goods or services; and
       (C) ground support vehicles at public airports (including 
     vehicles to carry baggage or push or pull airplanes toward or 
     away from terminal gates).
       (3) The acquisition of ultra-low sulfur diesel vehicles.
       (4) Installation or acquisition of infrastructure necessary 
     to directly support an alternative fueled vehicle, fuel cell 
     vehicle, or hybrid vehicle project funded by the grant, 
     including fueling and other support equipment.
       (5) Operation and maintenance of vehicles, infrastructure, 
     and equipment acquired as part of a project funded by the 
     grant.
       (c) Applications.--
       (1) Requirements.--
       (A) In general.--The Secretary shall issue requirements for 
     applying for grants under the pilot program.
       (B) Minimum requirements.--At a minimum, the Secretary 
     shall require that an application for a grant--
       (i) be submitted by the head of a State or local government 
     or a metropolitan transportation authority, or any 
     combination thereof, and a registered participant in the 
     Clean Cities Program of the Department; and
       (ii) include--

       (I) a description of the project proposed in the 
     application, including how the project meets the requirements 
     of this part;
       (II) an estimate of the ridership or degree of use of the 
     project;
       (III) an estimate of the air pollution emissions reduced 
     and fossil fuel displaced as a result of the project, and a 
     plan to collect and disseminate environmental data, related 
     to the project to be funded under the grant, over the life of 
     the project;
       (IV) a description of how the project will be sustainable 
     without Federal assistance after the completion of the term 
     of the grant;
       (V) a complete description of the costs of the project, 
     including acquisition, construction, operation, and 
     maintenance costs over the expected life of the project;
       (VI) a description of which costs of the project will be 
     supported by Federal assistance under this part; and
       (VII) documentation to the satisfaction of the Secretary 
     that diesel fuel containing sulfur at not more than 15 parts 
     per million is available for carrying out the project, and a 
     commitment by the applicant to use such fuel in carrying out 
     the project.

       (2) Partners.--An applicant under paragraph (1) may carry 
     out a project under the pilot program in partnership with 
     public and private entities.
       (d) Selection Criteria.--In evaluating applications under 
     the pilot program, the Secretary shall--
       (1) consider each applicant's previous experience with 
     similar projects; and
       (2) give priority consideration to applications that--
       (A) are most likely to maximize protection of the 
     environment;
       (B) demonstrate the greatest commitment on the part of the 
     applicant to ensure funding for the proposed project and the 
     greatest likelihood that the project will be maintained or 
     expanded after Federal assistance under this part is 
     completed; and
       (C) exceed the minimum requirements of subsection 
     (c)(1)(B)(ii).
       (e) Pilot Project Requirements.--
       (1) Maximum amount.--The Secretary shall not provide more 
     than $15,000,000 in Federal assistance under the pilot 
     program to any applicant.
       (2) Cost sharing.--The Secretary shall not provide more 
     than 50 percent of the cost, incurred during the period of 
     the grant, of any project under the pilot program.
       (3) Maximum period of grants.--The Secretary shall not fund 
     any applicant under the pilot program for more than 5 years.

[[Page 17856]]

       (4) Deployment and distribution.--The Secretary shall seek 
     to the maximum extent practicable to ensure a broad 
     geographic distribution of project sites.
       (5) Transfer of information and knowledge.--The Secretary 
     shall establish mechanisms to ensure that the information and 
     knowledge gained by participants in the pilot program are 
     transferred among the pilot program participants and to other 
     interested parties, including other applicants that submitted 
     applications.
       (f) Schedule.--
       (1) Publication.--Not later than 90 days after the date of 
     enactment of this Act, the Secretary shall publish in the 
     Federal Register, Commerce Business Daily, and elsewhere as 
     appropriate, a request for applications to undertake projects 
     under the pilot program. Applications shall be due not later 
     than 180 days after the date of publication of the notice.
       (2) Selection.--Not later than 180 days after the date by 
     which applications for grants are due, the Secretary shall 
     select by competitive, peer reviewed proposal, all 
     applications for projects to be awarded a grant under the 
     pilot program.
       (g) Definitions.--For purposes of carrying out the pilot 
     program, the Secretary shall issue regulations defining any 
     term, as the Secretary determines to be necessary.

     SEC. 722. REPORTS TO CONGRESS.

       (a) Initial Report.--Not later than 60 days after the date 
     on which grants are awarded under this part, the Secretary 
     shall submit to Congress a report containing--
       (1) an identification of the grant recipients and a 
     description of the projects to be funded;
       (2) an identification of other applicants that submitted 
     applications for the pilot program; and
       (3) a description of the mechanisms used by the Secretary 
     to ensure that the information and knowledge gained by 
     participants in the pilot program are transferred among the 
     pilot program participants and to other interested parties, 
     including other applicants that submitted applications.
       (b) Evaluation.--Not later than 3 years after the date of 
     enactment of this Act, and annually thereafter until the 
     pilot program ends, the Secretary shall submit to Congress a 
     report containing an evaluation of the effectiveness of the 
     pilot program, including--
       (1) an assessment of the benefits to the environment 
     derived from the projects included in the pilot program; and
       (2) an estimate of the potential benefits to the 
     environment to be derived from widespread application of 
     alternative fueled vehicles and ultra-low sulfur diesel 
     vehicles.

     SEC. 723. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated to the Secretary to 
     carry out this part $200,000,000, to remain available until 
     expended.

                        PART 3--FUEL CELL BUSES

     SEC. 731. FUEL CELL TRANSIT BUS DEMONSTRATION.

       (a) In General.--The Secretary, in consultation with the 
     Secretary of Transportation, shall establish a transit bus 
     demonstration program to make competitive, merit-based awards 
     for 5-year projects to demonstrate not more than 25 fuel cell 
     transit buses (and necessary infrastructure) in 5 
     geographically dispersed localities.
       (b) Preference.--In selecting projects under this section, 
     the Secretary shall give preference to projects that are most 
     likely to mitigate congestion and improve air quality.
       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary to carry out this section 
     $10,000,000 for each of fiscal years 2006 through 2010.
                     Subtitle C--Clean School Buses

     SEC. 741. CLEAN SCHOOL BUS PROGRAM.

       (a) Definitions.--In this section:
       (1) Administrator.--The term ``Administrator'' means the 
     Administrator of the Environmental Protection Agency.
       (2) Alternative fuel.--The term ``alternative fuel'' 
     means--
       (A) liquefied natural gas, compressed natural gas, 
     liquefied petroleum gas, hydrogen, or propane;
       (B) methanol or ethanol at no less than 85 percent by 
     volume; or
       (C) biodiesel conforming with standards published by the 
     American Society for Testing and Materials as of the date of 
     enactment of this Act.
       (3) Clean school bus.--The term ``clean school bus'' means 
     a school bus with a gross vehicle weight of greater than 
     14,000 pounds that--
       (A) is powered by a heavy duty engine; and
       (B) is operated solely on an alternative fuel or ultra-low 
     sulfur diesel fuel.
       (4) Eligible recipient.--
       (A) In general.--Subject to subparagraph (B), the term 
     ``eligible recipient'' means--
       (i) 1 or more local or State governmental entities 
     responsible for--

       (I) providing school bus service to 1 or more public school 
     systems; or
       (II) the purchase of school buses;

       (ii) 1 or more contracting entities that provide school bus 
     service to 1 or more public school systems; or
       (iii) a nonprofit school transportation association.
       (B) Special requirements.--In the case of eligible 
     recipients identified under clauses (ii) and (iii), the 
     Administrator shall establish timely and appropriate 
     requirements for notice and may establish timely and 
     appropriate requirements for approval by the public school 
     systems that would be served by buses purchased or retrofit 
     using grant funds made available under this section.
       (5) Retrofit technology.--The term ``retrofit technology'' 
     means a particulate filter or other emissions control 
     equipment that is verified or certified by the Administrator 
     or the California Air Resources Board as an effective 
     emission reduction technology when installed on an existing 
     school bus.
       (6) Ultra low sulfur diesel fuel.--The term ``ultra-low 
     sulfur diesel fuel'' means diesel fuel that contains sulfur 
     at not more than 15 parts per million.
       (b) Program for Retrofit or Replacement of Certain Existing 
     School Buses With Clean School Buses.--
       (1) Establishment.--
       (A) In general.--The Administrator, in consultation with 
     the Secretary and other appropriate Federal departments and 
     agencies, shall establish a program for awarding grants on a 
     competitive basis to eligible recipients for the replacement, 
     or retrofit (including repowering, aftertreatment, and 
     remanufactured engines) of, certain existing school buses.
       (B) Balancing.--In awarding grants under this section, the 
     Administrator shall, to the maximum extent practicable, 
     achieve an appropriate balance between awarding grants--
       (i) to replace school buses; and
       (ii) to install retrofit technologies.
       (2) Priority of grant applications.--
       (A) Replacement.--In the case of grant applications to 
     replace school buses, the Administrator shall give priority 
     to applicants that propose to replace school buses 
     manufactured before model year 1977.
       (B) Retrofitting.--In the case of grant applications to 
     retrofit school buses, the Administrator shall give priority 
     to applicants that propose to retrofit school buses 
     manufactured in or after model year 1991.
       (3) Use of school bus fleet.--
       (A) In general.--All school buses acquired or retrofitted 
     with funds provided under this section shall be operated as 
     part of the school bus fleet for which the grant was made for 
     not less than 5 years.
       (B) Maintenance, operation, and fueling.--New school buses 
     and retrofit technology shall be maintained, operated, and 
     fueled according to manufacturer recommendations or State 
     requirements.
       (4) Retrofit grants.--The Administrator may award grants 
     for up to 100 percent of the retrofit technologies and 
     installation costs.
       (5) Replacement grants.--
       (A) Eligibility for 50 percent grants.--The Administrator 
     may award grants for replacement of school buses in the 
     amount of up to \1/2\ of the acquisition costs (including 
     fueling infrastructure) for--
       (i) clean school buses with engines manufactured in model 
     year 2005 or 2006 that emit not more than--

       (I) 1.8 grams per brake horsepower-hour of non-methane 
     hydrocarbons and oxides of nitrogen; and
       (II) .01 grams per brake horsepower-hour of particulate 
     matter; or

       (ii) clean school buses with engines manufactured in model 
     year 2007, 2008, or 2009 that satisfy regulatory requirements 
     established by the Administrator for emissions of oxides of 
     nitrogen and particulate matter to be applicable for school 
     buses manufactured in model year 2010.
       (B) Eligibility for 25 percent grants.--The Administrator 
     may award grants for replacement of school buses in the 
     amount of up to \1/4\ of the acquisition costs (including 
     fueling infrastructure) for--
       (i) clean school buses with engines manufactured in model 
     year 2005 or 2006 that emit not more than--

       (I) 2.5 grams per brake horsepower-hour of non-methane 
     hydrocarbons and oxides of nitrogen; and
       (II) .01 grams per brake horsepower-hour of particulate 
     matter; or

       (ii) clean school buses with engines manufactured in model 
     year 2007 or thereafter that satisfy regulatory requirements 
     established by the Administrator for emissions of oxides of 
     nitrogen and particulate matter from school buses 
     manufactured in that model year.
       (6) Ultra low sulfur diesel fuel.--
       (A) In general.--In the case of a grant recipient receiving 
     a grant for the acquisition of ultra-low sulfur diesel fuel 
     school buses with engines manufactured in model year 2005 or 
     2006, the grant recipient shall provide, to the satisfaction 
     of the Administrator--
       (i) documentation that diesel fuel containing sulfur at not 
     more than 15 parts per million is available for carrying out 
     the purposes of the grant; and
       (ii) a commitment by the applicant to use that fuel in 
     carrying out the purposes of the grant.
       (7) Deployment and distribution.--The Administrator shall, 
     to the maximum extent practicable--
       (A) achieve nationwide deployment of clean school buses 
     through the program under this section; and
       (B) ensure a broad geographic distribution of grant awards, 
     with no State receiving more than 10 percent of the grant 
     funding made available under this section during a fiscal 
     year.
       (8) Annual report.--
       (A) In general.--Not later than January 31 of each year, 
     the Administrator shall submit to Congress a report that--
       (i) evaluates the implementation of this section; and
       (ii) describes--

       (I) the total number of grant applications received;

[[Page 17857]]

       (II) the number and types of alternative fuel school buses, 
     ultra-low sulfur diesel fuel school buses, and retrofitted 
     buses requested in grant applications;
       (III) grants awarded and the criteria used to select the 
     grant recipients;
       (IV) certified engine emission levels of all buses 
     purchased or retrofitted under this section;
       (V) an evaluation of the in-use emission level of buses 
     purchased or retrofitted under this section; and
       (VI) any other information the Administrator considers 
     appropriate.

       (c) Education.--
       (1) In general.--Not later than 90 days after the date of 
     enactment of this Act, the Administrator shall develop an 
     education outreach program to promote and explain the grant 
     program.
       (2) Coordination with stakeholders.--The outreach program 
     shall be designed and conducted in conjunction with national 
     school bus transportation associations and other 
     stakeholders.
       (3) Components.--The outreach program shall--
       (A) inform potential grant recipients on the process of 
     applying for grants;
       (B) describe the available technologies and the benefits of 
     the technologies;
       (C) explain the benefits of participating in the grant 
     program; and
       (D) include, as appropriate, information from the annual 
     report required under subsection (b)(8).
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Administrator to carry out this 
     section, to remain available until expended--
       (1) $55,000,000 for each of fiscal years 2006 and 2007; and
       (2) such sums as are necessary for each of fiscal years 
     2008, 2009, and 2010.

     SEC. 742. DIESEL TRUCK RETROFIT AND FLEET MODERNIZATION 
                   PROGRAM.

       (a) Establishment.--The Administrator, in consultation with 
     the Secretary, shall establish a program for awarding grants 
     on a competitive basis to public agencies and entities for 
     fleet modernization programs including installation of 
     retrofit technologies for diesel trucks.
       (b) Eligible Recipients.--A grant shall be awarded under 
     this section only to a State or local government or an agency 
     or instrumentality of a State or local government or of two 
     or more State or local governments who will allocate funds, 
     with preference to ports and other major hauling operations.
       (c) Awards.--
       (1) In general.--The Administrator shall seek, to the 
     maximum extent practicable, to ensure a broad geographic 
     distribution of grants under this section.
       (2) Preferences.--In making awards of grants under this 
     section, the Administrator shall give preference to proposals 
     that--
       (A) will achieve the greatest reductions in emissions of 
     nonmethane hydrocarbons, oxides of nitrogen, and/or 
     particulate matter per proposal or per truck; or
       (B) involve the use of Environmental Protection Agency or 
     California Air Resources Board verified emissions control 
     retrofit technology on diesel trucks that operate solely on 
     ultra-low sulfur diesel fuel after September 2006.
       (d) Conditions of Grant.--A grant shall be provided under 
     this section on the conditions that--
       (1) trucks which are replacing scrapped trucks and on which 
     retrofit emissions-control technology are to be 
     demonstrated--
       (A) will operate on ultra-low sulfur diesel fuel where such 
     fuel is reasonably available or required for sale by State or 
     local law or regulation;
       (B) were manufactured in model year 1998 and before; and
       (C) will be used for the transportation of cargo goods 
     especially in port areas or used in goods movement and major 
     hauling operations;
       (2) grant funds will be used for the purchase of emission 
     control retrofit technology, including State taxes and 
     contract fees; and
       (3) grant recipients will provide at least 50 percent of 
     the total cost of the retrofit, including the purchase of 
     emission control retrofit technology and all necessary labor 
     for installation of the retrofit, from any source other than 
     this section.
       (e) Verification.--Not later than 90 days after the date of 
     enactment of this Act, the Administrator shall publish in the 
     Federal Register procedures to--
       (1) make grants pursuant to this section;
       (2) verify that trucks powered by ultra-low sulfur diesel 
     fuel on which retrofit emissions-control technology are to be 
     demonstrated will operate on diesel fuel containing not more 
     than 15 parts per million of sulfur after September 2006; and
       (3) verify that grants are administered in accordance with 
     this section.
       (f) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Administrator to carry out this 
     section, to remain available until expended the following 
     sums:
       (1) $20,000,000 for fiscal year 2006.
       (2) $35,000,000 for fiscal year 2007.
       (3) $45,000,000 for fiscal year 2008.
       (4) Such sums as are necessary for each of fiscal years 
     2009 and 2010.

     SEC. 743. FUEL CELL SCHOOL BUSES.

       (a) Establishment.--The Secretary shall establish a program 
     for entering into cooperative agreements--
       (1) with private sector fuel cell bus developers for the 
     development of fuel cell-powered school buses; and
       (2) subsequently, with not less than 2 units of local 
     government using natural gas-powered school buses and such 
     private sector fuel cell bus developers to demonstrate the 
     use of fuel cell-powered school buses.
       (b) Cost Sharing.--The non-Federal contribution for 
     activities funded under this section shall be not less than--
       (1) 20 percent for fuel infrastructure development 
     activities; and
       (2) 50 percent for demonstration activities and for 
     development activities not described in paragraph (1).
       (c) Reports to Congress.--Not later than 3 years after the 
     date of enactment of this Act, the Secretary shall transmit 
     to Congress a report that--
       (1) evaluates the process of converting natural gas 
     infrastructure to accommodate fuel cell-powered school buses; 
     and
       (2) assesses the results of the development and 
     demonstration program under this section.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary to carry out this section 
     $25,000,000 for the period of fiscal years 2006 through 2009.
                       Subtitle D--Miscellaneous

     SEC. 751. RAILROAD EFFICIENCY.

       (a) Establishment.--The Secretary shall (in cooperation 
     with the Secretary of Transportation and the Administrator of 
     the Environmental Protection Agency) establish a cost-shared, 
     public-private research partnership involving the Federal 
     Government, railroad carriers, locomotive manufacturers and 
     equipment suppliers, and the Association of American 
     Railroads, to develop and demonstrate railroad locomotive 
     technologies that increase fuel economy, reduce emissions, 
     and lower costs of operation.
       (b) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary to carry out this 
     section--
       (1) $15,000,000 for fiscal year 2006;
       (2) $20,000,000 for fiscal year 2007; and
       (3) $30,000,000 for fiscal year 2008.

     SEC. 752. MOBILE EMISSION REDUCTIONS TRADING AND CREDITING.

       (a) In General.--Not later than 180 days after the date of 
     enactment of this Act, the Administrator of the Environmental 
     Protection Agency shall submit to Congress a report on the 
     experience of the Administrator with the trading of mobile 
     source emission reduction credits for use by owners and 
     operators of stationary source emission sources to meet 
     emission offset requirements within a nonattainment area.
       (b) Contents.--The report shall describe--
       (1) projects approved by the Administrator that include the 
     trading of mobile source emission reduction credits for use 
     by stationary sources in complying with offset requirements, 
     including a description of--
       (A) project and stationary sources location;
       (B) volumes of emissions offset and traded;
       (C) the sources of mobile emission reduction credits; and
       (D) if available, the cost of the credits;
       (2) the significant issues identified by the Administrator 
     in consideration and approval of trading in the projects;
       (3) the requirements for monitoring and assessing the air 
     quality benefits of any approved project;
       (4) the statutory authority on which the Administrator has 
     based approval of the projects;
       (5) an evaluation of how the resolution of issues in 
     approved projects could be used in other projects and whether 
     the emission reduction credits may be considered to be 
     additional in relation to other requirements;
       (6) the potential, for attainment purposes, of emission 
     reduction credits relating to transit and land use policies; 
     and
       (7) any other issues that the Administrator considers 
     relevant to the trading and generation of mobile source 
     emission reduction credits for use by stationary sources or 
     for other purposes.

     SEC. 753. AVIATION FUEL CONSERVATION AND EMISSIONS.

       (a) In General.--Not later than 60 days after the date of 
     enactment of this Act, the Administrator of the Federal 
     Aviation Administration and the Administrator of the 
     Environmental Protection Agency shall jointly initiate a 
     study to identify--
       (1) the impact of aircraft emissions on air quality in 
     nonattainment areas;
       (2) ways to promote fuel conservation measures for aviation 
     to enhance fuel efficiency and reduce emissions; and
       (3) opportunities to reduce air traffic inefficiencies that 
     increase fuel burn and emissions.
       (b) Focus.--The study under subsection (a) shall focus on 
     how air traffic management inefficiencies, such as aircraft 
     idling at airports, result in unnecessary fuel burn and air 
     emissions.
       (c) Report.--Not later than 1 year after the date of the 
     initiation of the study under subsection (a), the 
     Administrator of the Federal Aviation Administration and the 
     Administrator of the Environmental Protection Agency shall 
     jointly submit to the Committee on Energy and Commerce and 
     the Committee on Transportation and Infrastructure of the 
     House of Representatives and the Committee on Environment and 
     Public Works and the Committee on Commerce, Science, and 
     Transportation of the Senate a report that--
       (1) describes the results of the study; and
       (2) includes any recommendations on ways in which 
     unnecessary fuel use and emissions affecting air quality may 
     be reduced--
       (A) without adversely affecting safety and security and 
     increasing individual aircraft noise; and
       (B) while taking into account all aircraft emissions and 
     the impact of those emissions on the human health.

[[Page 17858]]

       (d) Risk Assessments.--Any assessment of risk to human 
     health and the environment prepared by the Administrator of 
     the Federal Aviation Administration or the Administrator of 
     the Environmental Protection Agency to support the report in 
     this section shall be based on sound and objective scientific 
     practices, shall consider the best available science, and 
     shall present the weight of the scientific evidence 
     concerning such risks.

     SEC. 754. DIESEL FUELED VEHICLES.

       (a) Definition of Tier 2 Emission Standards.--In this 
     section, the term ``tier 2 emission standards'' means the 
     motor vehicle emission standards that apply to passenger 
     cars, light trucks, and larger passenger vehicles 
     manufactured after the 2003 model year, as issued on February 
     10, 2000, by the Administrator of the Environmental 
     Protection Agency under sections 202 and 211 of the Clean Air 
     Act (42 U.S.C. 7521, 7545).
       (b) Diesel Combustion and After-Treatment Technologies.--
     The Secretary shall accelerate efforts to improve diesel 
     combustion and after-treatment technologies for use in diesel 
     fueled motor vehicles.
       (c) Goals.--The Secretary shall carry out subsection (b) 
     with a view toward achieving the following goals:
       (1) Developing and demonstrating diesel technologies that, 
     not later than 2010, meet the following standards:
       (A) Tier 2 emission standards.
       (B) The heavy-duty emissions standards of 2007 that are 
     applicable to heavy-duty vehicles under regulations issued by 
     the Administrator of the Environmental Protection Agency as 
     of the date of enactment of this Act.
       (2) Developing the next generation of low-emission, high 
     efficiency diesel engine technologies, including homogeneous 
     charge compression ignition technology.

     SEC. 755. CONSERVE BY BICYCLING PROGRAM.

       (a) Definitions.--In this section:
       (1) Program.--The term ``program'' means the Conserve by 
     Bicycling Program established by subsection (b).
       (2) Secretary.--The term ``Secretary'' means the Secretary 
     of Transportation.
       (b) Establishment.--There is established within the 
     Department of Transportation a program to be known as the 
     ``Conserve by Bicycling Program''.
       (c) Projects.--
       (1) In general.--In carrying out the program, the Secretary 
     shall establish not more than 10 pilot projects that are--
       (A) dispersed geographically throughout the United States; 
     and
       (B) designed to conserve energy resources by encouraging 
     the use of bicycles in place of motor vehicles.
       (2) Requirements.--A pilot project described in paragraph 
     (1) shall--
       (A) use education and marketing to convert motor vehicle 
     trips to bicycle trips;
       (B) document project results and energy savings (in 
     estimated units of energy conserved);
       (C) facilitate partnerships among interested parties in at 
     least 2 of the fields of--
       (i) transportation;
       (ii) law enforcement;
       (iii) education;
       (iv) public health;
       (v) environment; and
       (vi) energy;
       (D) maximize bicycle facility investments;
       (E) demonstrate methods that may be used in other regions 
     of the United States; and
       (F) facilitate the continuation of ongoing programs that 
     are sustained by local resources.
       (3) Cost sharing.--At least 20 percent of the cost of each 
     pilot project described in paragraph (1) shall be provided 
     from non-Federal sources.
       (d) Energy and Bicycling Research Study.--
       (1) In general.--Not later than 2 years after the date of 
     enactment of this Act, the Secretary shall enter into a 
     contract with the National Academy of Sciences for, and the 
     National Academy of Sciences shall conduct and submit to 
     Congress a report on, a study on the feasibility of 
     converting motor vehicle trips to bicycle trips.
       (2) Components.--The study shall--
       (A) document the results or progress of the pilot projects 
     under subsection (c);
       (B) determine the type and duration of motor vehicle trips 
     that people in the United States may feasibly make by 
     bicycle, taking into consideration factors such as--
       (i) weather;
       (ii) land use and traffic patterns;
       (iii) the carrying capacity of bicycles; and
       (iv) bicycle infrastructure;
       (C) determine any energy savings that would result from the 
     conversion of motor vehicle trips to bicycle trips;
       (D) include a cost-benefit analysis of bicycle 
     infrastructure investments; and
       (E) include a description of any factors that would 
     encourage more motor vehicle trips to be replaced with 
     bicycle trips.
       (e) Authorization of Appropriations.--There is authorized 
     to be appropriated to the Secretary to carry out this section 
     $6,200,000, to remain available until expended, of which--
       (1) $5,150,000 shall be used to carry out pilot projects 
     described in subsection (c);
       (2) $300,000 shall be used by the Secretary to coordinate, 
     publicize, and disseminate the results of the program; and
       (3) $750,000 shall be used to carry out subsection (d).

     SEC. 756. REDUCTION OF ENGINE IDLING.

       (a) Definitions.--In this section:
       (1) Administrator.--The term ``Administrator'' means the 
     Administrator of the Environmental Protection Agency.
       (2) Advanced truck stop electrification system.--The term 
     ``advanced truck stop electrification system'' means a 
     stationary system that delivers heat, air conditioning, 
     electricity, or communications, and is capable of providing 
     verifiable and auditable evidence of use of those services, 
     to a heavy-duty vehicle and any occupants of the heavy-duty 
     vehicle with or without relying on components mounted onboard 
     the heavy-duty vehicle for delivery of those services.
       (3) Auxiliary power unit.--The term ``auxiliary power 
     unit'' means an integrated system that--
       (A) provides heat, air conditioning, engine warming, or 
     electricity to components on a heavy-duty vehicle; and
       (B) is certified by the Administrator under part 89 of 
     title 40, Code of Federal Regulations (or any successor 
     regulation), as meeting applicable emission standards.
       (4) Heavy-duty vehicle.--The term ``heavy-duty vehicle'' 
     means a vehicle that--
       (A) has a gross vehicle weight rating greater than 8,500 
     pounds; and
       (B) is powered by a diesel engine.
       (5) Idle reduction technology.--The term ``idle reduction 
     technology'' means an advanced truck stop electrification 
     system, auxiliary power unit, or other technology that--
       (A) is used to reduce long-duration idling; and
       (B) allows for the main drive engine or auxiliary 
     refrigeration engine to be shut down.
       (6) Energy conservation technology.--the term ``energy 
     conservation technology'' means any device, system of 
     devices, or equipment that improves the fuel economy.
       (7) Long-duration idling.--
       (A) In general.--The term ``long-duration idling'' means 
     the operation of a main drive engine or auxiliary 
     refrigeration engine, for a period greater than 15 
     consecutive minutes, at a time at which the main drive engine 
     is not engaged in gear.
       (B) Exclusions.--The term ``long-duration idling'' does not 
     include the operation of a main drive engine or auxiliary 
     refrigeration engine during a routine stoppage associated 
     with traffic movement or congestion.
       (b) Idle Reduction Technology Benefits, Programs, and 
     Studies.--
       (1) In general.--Not later than 90 days after the date of 
     enactment of this Act, the Administrator shall--
       (A)(i) commence a review of the mobile source air emission 
     models of the Environmental Protection Agency used under the 
     Clean Air Act (42 U.S.C. 7401 et seq.) to determine whether 
     the models accurately reflect the emissions resulting from 
     long-duration idling of heavy-duty vehicles and other 
     vehicles and engines; and
       (ii) update those models as the Administrator determines to 
     be appropriate; and
       (B)(i) commence a review of the emission reductions 
     achieved by the use of idle reduction technology; and
       (ii) complete such revisions of the regulations and 
     guidance of the Environmental Protection Agency as the 
     Administrator determines to be appropriate.
       (2) Deadline for completion.--Not later than 180 days after 
     the date of enactment of this Act, the Administrator shall--
       (A) complete the reviews under subparagraphs (A)(i) and 
     (B)(i) of paragraph (1); and
       (B) prepare and make publicly available 1 or more reports 
     on the results of the reviews.
       (3) Discretionary inclusions.--The reviews under 
     subparagraphs (A)(i) and (B)(i) of paragraph (1) and the 
     reports under paragraph (2)(B) may address the potential fuel 
     savings resulting from use of idle reduction technology.
       (4) Idle reduction and energy conservation deployment 
     program.--
       (A) Establishment.--
       (i) In general.--Not later than 90 days after the date of 
     enactment of this Act, the Administrator, in consultation 
     with the Secretary of Transportation shall, through the 
     Environmental Protection Agency's SmartWay Transport 
     Partnership, establish a program to support deployment of 
     idle reduction and energy conservation technologies.
       (ii) Priority.--The Administrator shall give priority to 
     the deployment of idle reduction and energy conservation 
     technologies based on the costs and beneficial effects on air 
     quality and ability to lessen the emission of criteria air 
     pollutants.
       (B) Funding.--
       (i) Authorization of appropriations.--There are authorized 
     to be appropriated to the Administrator to carry out 
     subparagraph (A) for the purpose of reducing extended idling 
     from heavy-duty vehicles $19,500,000 for fiscal year 2006, 
     $30,000,000 for fiscal year 2007, and $45,000,000 for fiscal 
     year 2008.
       (ii) Locomotives.--There are authorized to be appropriated 
     to the administrator to carry out subparagraph (A) for the 
     purpose of reducing extended idling from locomotives 
     $10,000,000 for fiscal year 2006, $15,000,000 for fiscal year 
     2007, and $20,000,000 for fiscal year 2008.
       (iii) Cost sharing.--Subject to clause (iv), the 
     Administrator shall require at least 50 percent of the costs 
     directly and specifically related to any project under this 
     section to be provided from non-Federal sources.
       (iv) Necessary and appropriate reductions.--The 
     Administrator may reduce the non-Federal requirement under 
     clause (iii) if the Administrator determines that the 
     reduction is necessary and appropriate to meet the objectives 
     of this section.

[[Page 17859]]

       (5) Idling location study.--
       (A) In general.--Not later than 90 days after the date of 
     enactment of this Act, the Administrator, in consultation 
     with the Secretary of Transportation, shall commence a study 
     to analyze all locations at which heavy-duty vehicles stop 
     for long-duration idling, including--
       (i) truck stops;
       (ii) rest areas;
       (iii) border crossings;
       (iv) ports;
       (v) transfer facilities; and
       (vi) private terminals.
       (B) Deadline for completion.--Not later than 180 days after 
     the date of enactment of this Act, the Administrator shall--
       (i) complete the study under subparagraph (A); and
       (ii) prepare and make publicly available 1 or more reports 
     of the results of the study.
       (c) Vehicle Weight Exemption.--Section 127(a) of title 23, 
     United States Code, is amended--
       (1) by designating the first through eleventh sentences as 
     paragraphs (1) through (11), respectively; and
       (2) by adding at the end the following:
       ``(12) Heavy duty vehicles.--
       ``(A) In general.--Subject to subparagraphs (B) and (C), in 
     order to promote reduction of fuel use and emissions because 
     of engine idling, the maximum gross vehicle weight limit and 
     the axle weight limit for any heavy-duty vehicle equipped 
     with an idle reduction technology shall be increased by a 
     quantity necessary to compensate for the additional weight of 
     the idle reduction system.
       ``(B) Maximum weight increase.--The weight increase under 
     subparagraph (A) shall be not greater than 400 pounds.
       ``(C) Proof.--On request by a regulatory agency or law 
     enforcement agency, the vehicle operator shall provide proof 
     (through demonstration or certification) that--
       ``(i) the idle reduction technology is fully functional at 
     all times; and
       ``(ii) the 400-pound gross weight increase is not used for 
     any purpose other than the use of idle reduction technology 
     described in subparagraph (A).''.
       (d) Report.--Not later than 60 days after the date on which 
     funds are initially awarded under this section, and on an 
     annual basis thereafter, the Administrator shall submit to 
     Congress a report containing--
       (1) an identification of the grant recipients, a 
     description of the projects to be funded and the amount of 
     funding provided; and
       (2) an identification of all other applicants that 
     submitted applications under the program.

     SEC. 757. BIODIESEL ENGINE TESTING PROGRAM.

       (a) In General.--Not later that 180 days after the date of 
     enactment of this Act, the Secretary shall initiate a 
     partnership with diesel engine, diesel fuel injection system, 
     and diesel vehicle manufacturers and diesel and biodiesel 
     fuel providers, to include biodiesel testing in advanced 
     diesel engine and fuel system technology.
       (b) Scope.--The program shall provide for testing to 
     determine the impact of biodiesel from different sources on 
     current and future emission control technologies, with 
     emphasis on--
       (1) the impact of biodiesel on emissions warranty, in-use 
     liability, and antitampering provisions;
       (2) the impact of long-term use of biodiesel on engine 
     operations;
       (3) the options for optimizing these technologies for both 
     emissions and performance when switching between biodiesel 
     and diesel fuel; and
       (4) the impact of using biodiesel in these fueling systems 
     and engines when used as a blend with 2006 Environmental 
     Protection Agency-mandated diesel fuel containing a maximum 
     of 15-parts-per-million sulfur content.
       (c) Report.--Not later than 2 years after the date of 
     enactment of this Act, the Secretary shall provide an interim 
     report to Congress on the findings of the program, including 
     a comprehensive analysis of impacts from biodiesel on engine 
     operation for both existing and expected future diesel 
     technologies, and recommendations for ensuring optimal 
     emissions reductions and engine performance with biodiesel.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated $5,000,000 for each of fiscal years 2006 
     through 2010 to carry out this section.
       (e) Definition.--For purposes of this section, the term 
     ``biodiesel'' means a diesel fuel substitute produced from 
     nonpetroleum renewable resources that meets the registration 
     requirements for fuels and fuel additives established by the 
     Environmental Protection Agency under section 211 of the 
     Clean Air Act (42 U.S.C. 7545) and that meets the American 
     Society for Testing and Materials D6751-02a Standard 
     Specification for Biodiesel Fuel (B100) Blend Stock for 
     Distillate Fuels.

     SEC. 758. ULTRA-EFFICIENT ENGINE TECHNOLOGY FOR AIRCRAFT.

       (a) Ultra-Efficient Engine Technology Partnership.--The 
     Secretary shall enter into a cooperative agreement with the 
     National Aeronautics and Space Administration for the 
     development of ultra-efficient engine technology for 
     aircraft.
       (b) Performance Objective.--The Secretary shall establish 
     the following performance objectives for the program set 
     forth in subsection (a):
       (1) A fuel efficiency increase of at least 10 percent.
       (2) A reduction in the impact of landing and takeoff 
     nitrogen oxides emissions on local air quality of 70 percent.
       (3) Exploring advanced concepts, alternate propulsion, and 
     power configurations, including hybrid fuel cell powered 
     systems.
       (4) Exploring the use of alternate fuel in conventional or 
     nonconventional turbine-based systems.
       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary for carrying out this 
     section $50,000,000 for each of the fiscal years 2006, 2007, 
     2008, 2009, and 2010.

     SEC. 759. FUEL ECONOMY INCENTIVE REQUIREMENTS.

       Section 32905 of title 49, United States Code, is amended 
     by adding the following new subsection at the end thereof:
       ``(h) Fuel Economy Incentive Requirements.--In order for 
     any model of dual fueled automobile to be eligible to receive 
     the fuel economy incentives included in section 32906(a) and 
     (b), a label shall be attached to the fuel compartment of 
     each dual fueled automobile of that model, notifying that the 
     vehicle can be operated on an alternative fuel and on 
     gasoline or diesel, with the form of alternative fuel stated 
     on the notice. This requirement applies to dual fueled 
     automobiles manufactured on or after September 1, 2006.''.
                   Subtitle E--Automobile Efficiency

     SEC. 771. AUTHORIZATION OF APPROPRIATIONS FOR IMPLEMENTATION 
                   AND ENFORCEMENT OF FUEL ECONOMY STANDARDS.

       In addition to any other funds authorized by law, there are 
     authorized to be appropriated to the National Highway Traffic 
     Safety Administration to carry out its obligations with 
     respect to average fuel economy standards $3,500,000 for each 
     of the fiscal years 2006 through 2010.

     SEC. 772. EXTENSION OF MAXIMUM FUEL ECONOMY INCREASE FOR 
                   ALTERNATIVE FUELED VEHICLES.

       (a) Manufacturing Incentives.--Section 32905 of title 49, 
     United States Code, is amended--
       (1) in each of subsections (b) and (d), by striking ``1993-
     2004'' and inserting ``1993-2010'';
       (2) in subsection (f), by striking ``2001'' and inserting 
     ``2007''; and
       (3) in subsection (f)(1), by striking ``2004'' and 
     inserting ``2010''.
       (b) Maximum Fuel Economy Increase.--Subsection (a)(1) of 
     section 32906 of title 49, United States Code, is amended--
       (1) in subparagraph (A), by striking ``the model years 
     1993-2004'' and inserting ``model years 1993-2010''; and
       (2) in subparagraph (B), by striking ``the model years 
     2005-2008'' and inserting ``model years 2011-2014''.

     SEC. 773. STUDY OF FEASIBILITY AND EFFECTS OF REDUCING USE OF 
                   FUEL FOR AUTOMOBILES.

       (a) In General.--Not later than 30 days after the date of 
     the enactment of this Act, the Administrator of the National 
     Highway Traffic Safety Administration shall initiate a study 
     of the feasibility and effects of reducing by model year 
     2014, by a significant percentage, the amount of fuel 
     consumed by automobiles.
       (b) Subjects of Study.--The study under this section shall 
     include--
       (1) examination of, and recommendation of alternatives to, 
     the policy under current Federal law of establishing average 
     fuel economy standards for automobiles and requiring each 
     automobile manufacturer to comply with average fuel economy 
     standards that apply to the automobiles it manufactures;
       (2) examination of how automobile manufacturers could 
     contribute toward achieving the reduction referred to in 
     subsection (a);
       (3) examination of the potential of fuel cell technology in 
     motor vehicles in order to determine the extent to which such 
     technology may contribute to achieving the reduction referred 
     to in subsection (a); and
       (4) examination of the effects of the reduction referred to 
     in subsection (a) on--
       (A) gasoline supplies;
       (B) the automobile industry, including sales of automobiles 
     manufactured in the United States;
       (C) motor vehicle safety; and
       (D) air quality.
       (c) Report.--The Administrator shall submit to Congress a 
     report on the findings, conclusion, and recommendations of 
     the study under this section by not later than 1 year after 
     the date of the enactment of this Act.

     SEC. 774. UPDATE TESTING PROCEDURES.

       The Administrator of the Environmental Protection Agency 
     shall update or revise the adjustment factors in sections 
     600.209-85 and 600.209-95, of the Code of Federal 
     Regulations, CFR Part 600 (1995) Fuel Economy Regulations for 
     1977 and Later Model Year Automobiles to take into 
     consideration higher speed limits, faster acceleration rates, 
     variations in temperature, use of air conditioning, shorter 
     city test cycle lengths, current reference fuels, and the use 
     of other fuel depleting features.
               Subtitle F--Federal and State Procurement

     SEC. 781. DEFINITIONS.

       In this subtitle:
       (1) Fuel cell.--The term ``fuel cell'' means a device that 
     directly converts the chemical energy of a fuel and an 
     oxidant into electricity by electrochemical processes 
     occurring at separate electrodes in the device.
       (2) Light-duty or heavy-duty vehicle fleet.--The term 
     ``light-duty or heavy-duty vehicle fleet'' does not include 
     any vehicle designed or procured for combat or combat-related 
     missions.

[[Page 17860]]

       (3) Stationary; portable.--The terms ``stationary'' and 
     ``portable'', when used in reference to a fuel cell, 
     include--
       (A) continuous electric power; and
       (B) backup electric power.
       (4) Task force.--The term ``Task Force'' means the Hydrogen 
     and Fuel Cell Technical Task Force established under section 
     806 of this Act.
       (5) Technical advisory committee.--The term ``Technical 
     Advisory Committee'' means the independent Technical Advisory 
     Committee selected under section 807 of this Act.

     SEC. 782. FEDERAL AND STATE PROCUREMENT OF FUEL CELL VEHICLES 
                   AND HYDROGEN ENERGY SYSTEMS.

       (a) Purposes.--The purposes of this section are--
       (1) to stimulate acceptance by the market of fuel cell 
     vehicles and hydrogen energy systems;
       (2) to support development of technologies relating to fuel 
     cell vehicles, public refueling stations, and hydrogen energy 
     systems; and
       (3) to require the Federal government, which is the largest 
     single user of energy in the United States, to adopt those 
     technologies as soon as practicable after the technologies 
     are developed, in conjunction with private industry partners.
       (b) Federal Leases and Purchases.--
       (1) Requirement.--
       (A) In general.--Not later than January 1, 2010, the head 
     of any Federal agency that uses a light-duty or heavy-duty 
     vehicle fleet shall lease or purchase fuel cell vehicles and 
     hydrogen energy systems to meet any applicable energy savings 
     goal described in subsection (c).
       (B) Learning demonstration vehicles.--The Secretary may 
     lease or purchase appropriate vehicles developed under 
     subsections (a)(10) and (b)(1)(A) of section 808 to meet the 
     requirement in subparagraph (A).
       (2) Costs of leases and purchases.--
       (A) In general.--The Secretary, in cooperation with the 
     Task Force and the Technical Advisory Committee, shall pay to 
     Federal agencies (or share the cost under interagency 
     agreements) the difference in cost between--
       (i) the cost to the agencies of leasing or purchasing fuel 
     cell vehicles and hydrogen energy systems under paragraph 
     (1); and
       (ii) the cost to the agencies of a feasible alternative to 
     leasing or purchasing fuel cell vehicles and hydrogen energy 
     systems, as determined by the Secretary.
       (B) Competitive costs and management structures.--In 
     carrying out subparagraph (A), the Secretary, in consultation 
     with the agency, may use the General Services Administration 
     or any commercial vendor to ensure--
       (i) a cost-effective purchase of a fuel cell vehicle or 
     hydrogen energy system; or
       (ii) a cost-effective management structure of the lease of 
     a fuel cell vehicle or hydrogen energy system.
       (3) Exception.--
       (A) In general.--If the Secretary determines that the head 
     of an agency described in paragraph (1) cannot find an 
     appropriately efficient and reliable fuel cell vehicle or 
     hydrogen energy system in accordance with paragraph (1), that 
     agency shall be excepted from compliance with paragraph (1).
       (B) Consideration.--In making a determination under 
     subparagraph (A), the Secretary shall consider--
       (i) the needs of the agency; and
       (ii) an evaluation performed by--

       (I) the Task Force; or
       (II) the Technical Advisory Committee.

       (c) Energy Savings Goals.--
       (1) In general.--
       (A) Regulations.--Not later than December 31, 2006, the 
     Secretary shall--
       (i) in cooperation with the Task Force, promulgate 
     regulations for the period of 2008 through 2010 that extend 
     and augment energy savings goals for each Federal agency, in 
     accordance with any Executive order issued after March 2000; 
     and
       (ii) promulgate regulations to expand the minimum Federal 
     fleet requirement and credit allowances for fuel cell vehicle 
     systems under section 303 of the Energy Policy Act of 1992 
     (42 U.S.C. 13212).
       (B) Review, evaluation, and new regulations.--Not later 
     than December 31, 2010, the Secretary shall--
       (i) review the regulations promulgated under subparagraph 
     (A);
       (ii) evaluate any progress made toward achieving energy 
     savings by Federal agencies; and
       (iii) promulgate new regulations for the period of 2011 
     through 2015 to achieve additional energy savings by Federal 
     agencies relating to technical and cost-performance 
     standards.
       (2) Offsetting energy savings goals.--An agency that leases 
     or purchases a fuel cell vehicle or hydrogen energy system in 
     accordance with subsection (b)(1) may use that lease or 
     purchase to count toward an energy savings goal of the 
     agency.
       (d) Cooperative Program With State Agencies.--
       (1) In general.--The Secretary may establish a cooperative 
     program with State agencies managing motor vehicle fleets to 
     encourage purchase of fuel cell vehicles by the agencies.
       (2) Incentives.--In carrying out the cooperative program, 
     the Secretary may offer incentive payments to a State agency 
     to assist with the cost of planning, differential purchases, 
     and administration.
       (e) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section--
       (1) $15,000,000 for fiscal year 2008;
       (2) $25,000,000 for fiscal year 2009;
       (3) $65,000,000 for fiscal year 2010; and
       (4) such sums as are necessary for each of fiscal years 
     2011 through 2015.

     SEC. 783. FEDERAL PROCUREMENT OF STATIONARY, PORTABLE, AND 
                   MICRO FUEL CELLS.

       (a) Purposes.--The purposes of this section are--
       (1) to stimulate acceptance by the market of stationary, 
     portable, and micro fuel cells; and
       (2) to support development of technologies relating to 
     stationary, portable, and micro fuel cells.
       (b) Federal Leases and Purchases.--
       (1) In general.--Not later than January 1, 2006, the head 
     of any Federal agency that uses electrical power from 
     stationary, portable, or microportable devices shall lease or 
     purchase a stationary, portable, or micro fuel cell to meet 
     any applicable energy savings goal described in subsection 
     (c).
       (2) Costs of leases and purchases.--
       (A) In general.--The Secretary, in cooperation with the 
     Task Force and the Technical Advisory Committee, shall pay 
     the cost to Federal agencies (or share the cost under 
     interagency agreements) of leasing or purchasing stationary, 
     portable, and micro fuel cells under paragraph (1).
       (B) Competitive costs and management structures.--In 
     carrying out subparagraph (A), the Secretary, in consultation 
     with the agency, may use the General Services Administration 
     or any commercial vendor to ensure--
       (i) a cost-effective purchase of a stationary, portable, or 
     micro fuel cell; or
       (ii) a cost-effective management structure of the lease of 
     a stationary, portable, or micro fuel cell.
       (3) Exception.--
       (A) In general.--If the Secretary determines that the head 
     of an agency described in paragraph (1) cannot find an 
     appropriately efficient and reliable stationary, portable, or 
     micro fuel cell in accordance with paragraph (1), that agency 
     shall be excepted from compliance with paragraph (1).
       (B) Consideration.--In making a determination under 
     subparagraph (A), the Secretary shall consider--
       (i) the needs of the agency; and
       (ii) an evaluation performed by--

       (I) the Task Force; or
       (II) the Technical Advisory Committee of the Task Force.

       (c) Energy Savings Goals.--An agency that leases or 
     purchases a stationary, portable, or micro fuel cell in 
     accordance with subsection (b)(1) may use that lease or 
     purchase to count toward an energy savings goal described in 
     section 808 of this Act that is applicable to the agency.
       (d) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section--
       (1) $20,000,000 for fiscal year 2006;
       (2) $50,000,000 for fiscal year 2007;
       (3) $75,000,000 for fiscal year 2008;
       (4) $100,000,000 for fiscal year 2009;
       (5) $100,000,000 for fiscal year 2010; and
       (6) such sums as are necessary for each of fiscal years 
     2011 through 2015.
                 Subtitle G--Diesel Emissions Reduction

     SEC. 791. DEFINITIONS.

       In this subtitle:
       (1) Administrator.--The term ``Administrator'' means the 
     Administrator of the Environmental Protection Agency.
       (2) Certified engine configuration.--The term ``certified 
     engine configuration'' means a new, rebuilt, or 
     remanufactured engine configuration--
       (A) that has been certified or verified by--
       (i) the Administrator; or
       (ii) the California Air Resources Board;
       (B) that meets or is rebuilt or remanufactured to a more 
     stringent set of engine emission standards, as determined by 
     the Administrator; and
       (C) in the case of a certified engine configuration 
     involving the replacement of an existing engine or vehicle, 
     an engine configuration that replaced an engine that was--
       (i) removed from the vehicle; and
       (ii) returned to the supplier for remanufacturing to a more 
     stringent set of engine emissions standards or for scrappage.
       (3) Eligible entity.--The term ``eligible entity'' means--
       (A) a regional, State, local, or tribal agency or port 
     authority with jurisdiction over transportation or air 
     quality; and
       (B) a nonprofit organization or institution that--
       (i) represents or provides pollution reduction or 
     educational services to persons or organizations that own or 
     operate diesel fleets; or
       (ii) has, as its principal purpose, the promotion of 
     transportation or air quality.
       (4) Emerging technology.--The term ``emerging technology'' 
     means a technology that is not certified or verified by the 
     Administrator or the California Air Resources Board but for 
     which an approvable application and test plan has been 
     submitted for verification to the Administrator or the 
     California Air Resources Board.
       (5) Fleet.--The term ``fleet'' means 1 or more diesel 
     vehicles or mobile or stationary diesel engines.
       (6) Heavy-duty truck.--The term ``heavy-duty truck'' has 
     the meaning given the term ``heavy duty vehicle'' in section 
     202 of the Clean Air Act (42 U.S.C. 7521).
       (7) Medium-duty truck.--The term ``medium-duty truck'' has 
     such meaning as shall be determined by the Administrator, by 
     regulation.

[[Page 17861]]

       (8) Verified technology.--The term ``verified technology'' 
     means a pollution control technology, including a retrofit 
     technology, advanced truckstop electrification system, or 
     auxiliary power unit, that has been verified by--
       (A) the Administrator; or
       (B) the California Air Resources Board.

     SEC. 792. NATIONAL GRANT AND LOAN PROGRAMS.

       (a) In General.--The Administrator shall use 70 percent of 
     the funds made available to carry out this subtitle for each 
     fiscal year to provide grants and low-cost revolving loans, 
     as determined by the Administrator, on a competitive basis, 
     to eligible entities to achieve significant reductions in 
     diesel emissions in terms of--
       (1) tons of pollution produced; and
       (2) diesel emissions exposure, particularly from fleets 
     operating in areas designated by the Administrator as poor 
     air quality areas.
       (b) Distribution.--
       (1) In general.--The Administrator shall distribute funds 
     made available for a fiscal year under this subtitle in 
     accordance with this section.
       (2) Fleets.--The Administrator shall provide not less than 
     50 percent of funds available for a fiscal year under this 
     section to eligible entities for the benefit of public 
     fleets.
       (3) Engine configurations and technologies.--
       (A) Certified engine configurations and verified 
     technologies.--The Administrator shall provide not less than 
     90 percent of funds available for a fiscal year under this 
     section to eligible entities for projects using--
       (i) a certified engine configuration; or
       (ii) a verified technology.
       (B) Emerging technologies.--
       (i) In general.--The Administrator shall provide not more 
     than 10 percent of funds available for a fiscal year under 
     this section to eligible entities for the development and 
     commercialization of emerging technologies.
       (ii) Application and test plan.--To receive funds under 
     clause (i), a manufacturer, in consultation with an eligible 
     entity, shall submit for verification to the Administrator or 
     the California Air Resources Board a test plan for the 
     emerging technology, together with the application under 
     subsection (c).
       (c) Applications.--
       (1) In general.--To receive a grant or loan under this 
     section, an eligible entity shall submit to the Administrator 
     an application at a time, in a manner, and including such 
     information as the Administrator may require.
       (2) Inclusions.--An application under this subsection shall 
     include--
       (A) a description of the air quality of the area served by 
     the eligible entity;
       (B) the quantity of air pollution produced by the diesel 
     fleets in the area served by the eligible entity;
       (C) a description of the project proposed by the eligible 
     entity, including--
       (i) any certified engine configuration, verified 
     technology, or emerging technology to be used or funded by 
     the eligible entity; and
       (ii) the means by which the project will achieve a 
     significant reduction in diesel emissions;
       (D) an evaluation (using methodology approved by the 
     Administrator or the National Academy of Sciences) of the 
     quantifiable and unquantifiable benefits of the emissions 
     reductions of the proposed project;
       (E) an estimate of the cost of the proposed project;
       (F) a description of the age and expected lifetime control 
     of the equipment used or funded by the eligible entity;
       (G) a description of the diesel fuel available in the areas 
     to be served by the eligible entity, including the sulfur 
     content of the fuel; and
       (H) provisions for the monitoring and verification of the 
     project.
       (3) Priority.--In providing a grant or loan under this 
     section, the Administrator shall give priority to proposed 
     projects that, as determined by the Administrator--
       (A) maximize public health benefits;
       (B) are the most cost-effective;
       (C) serve areas--
       (i) with the highest population density;
       (ii) that are poor air quality areas, including areas 
     identified by the Administrator as--

       (I) in nonattainment or maintenance of national ambient air 
     quality standards for a criteria pollutant;
       (II) Federal Class I areas; or
       (III) areas with toxic air pollutant concerns;

       (iii) that receive a disproportionate quantity of air 
     pollution from a diesel fleets, including truckstops, ports, 
     rail yards, terminals, and distribution centers; or
       (iv) that use a community-based multistakeholder 
     collaborative process to reduce toxic emissions;
       (D) include a certified engine configuration, verified 
     technology, or emerging technology that has a long expected 
     useful life;
       (E) will maximize the useful life of any certified engine 
     configuration, verified technology, or emerging technology 
     used or funded by the eligible entity;
       (F) conserve diesel fuel; and
       (G) use diesel fuel with a sulfur content of less than or 
     equal to 15 parts per million, as the Administrator 
     determines to be appropriate.
       (d) Use of Funds.--
       (1) In general.--An eligible entity may use a grant or loan 
     provided under this section to fund the costs of--
       (A) a retrofit technology (including any incremental costs 
     of a repowered or new diesel engine) that significantly 
     reduces emissions through development and implementation of a 
     certified engine configuration, verified technology, or 
     emerging technology for--
       (i) a bus;
       (ii) a medium-duty truck or a heavy-duty truck;
       (iii) a marine engine;
       (iv) a locomotive; or
       (v) a nonroad engine or vehicle used in--

       (I) construction;
       (II) handling of cargo (including at a port or airport);
       (III) agriculture;
       (IV) mining; or
       (V) energy production; or

       (B) programs or projects to reduce long-duration idling 
     using verified technology involving a vehicle or equipment 
     described in subparagraph (A).
       (2) Regulatory programs.--
       (A) In general.--Notwithstanding paragraph (1), no grant or 
     loan provided under this section shall be used to fund the 
     costs of emissions reductions that are mandated under 
     Federal, State or local law.
       (B) Mandated.--For purposes of subparagraph (A), voluntary 
     or elective emission reduction measures shall not be 
     considered ``mandated'', regardless of whether the reductions 
     are included in the State implementation plan of a State.

     SEC. 793. STATE GRANT AND LOAN PROGRAMS.

       (a) In General.--Subject to the availability of adequate 
     appropriations, the Administrator shall use 30 percent of the 
     funds made available for a fiscal year under this subtitle to 
     support grant and loan programs administered by States that 
     are designed to achieve significant reductions in diesel 
     emissions.
       (b) Applications.--The Administrator shall--
       (1) provide to States guidance for use in applying for 
     grant or loan funds under this section, including information 
     regarding--
       (A) the process and forms for applications;
       (B) permissible uses of funds received; and
       (C) the cost-effectiveness of various emission reduction 
     technologies eligible to be carried out using funds provided 
     under this section; and
       (2) establish, for applications described in paragraph 
     (1)--
       (A) an annual deadline for submission of the applications;
       (B) a process by which the Administrator shall approve or 
     disapprove each application; and
       (C) a streamlined process by which a State may renew an 
     application described in paragraph (1) for subsequent fiscal 
     years.
       (c) Allocation of Funds.--
       (1) In general.--For each fiscal year, the Administrator 
     shall allocate among States for which applications are 
     approved by the Administrator under subsection (b)(2)(B) 
     funds made available to carry out this section for the fiscal 
     year.
       (2) Allocation.--Using not more than 20 percent of the 
     funds made available to carry out this subtitle for a fiscal 
     year, the Administrator shall provide to each State described 
     in paragraph (1) for the fiscal year an allocation of funds 
     that is equal to--
       (A) if each of the 50 States qualifies for an allocation, 
     an amount equal to 2 percent of the funds made available to 
     carry out this section; or
       (B) if fewer than 50 States qualifies for an allocation, an 
     amount equal to the amount described in subparagraph (A), 
     plus an additional amount equal to the product obtained by 
     multiplying--
       (i) the proportion that--

       (I) the population of the State; bears to
       (II) the population of all States described in paragraph 
     (1); by

       (ii) the amount of funds remaining after each State 
     described in paragraph (1) receives the 2-percent allocation 
     under this paragraph.
       (3) State matching incentive.--
       (A) In general.--If a State agrees to match the allocation 
     provided to the State under paragraph (2) for a fiscal year, 
     the Administrator shall provide to the State for the fiscal 
     year an additional amount equal to 50 percent of the 
     allocation of the State under paragraph (2).
       (B) Requirements.--A State--
       (i) may not use funds received under this subtitle to pay a 
     matching share required under this subsection; and
       (ii) shall not be required to provide a matching share for 
     any additional amount received under subparagraph (A).
       (4) Unclaimed funds.--Any funds that are not claimed by a 
     State for a fiscal year under this subsection shall be used 
     to carry out section 792.
       (d) Administration.--
       (1) In general.--Subject to paragraphs (2) and (3) and, to 
     the extent practicable, the priority areas listed in section 
     792(c)(3), a State shall use any funds provided under this 
     section to develop and implement such grant and low-cost 
     revolving loan programs in the State as are appropriate to 
     meet State needs and goals relating to the reduction of 
     diesel emissions.
       (2) Apportionment of funds.--The Governor of a State that 
     receives funding under this section may determine the portion 
     of funds to be provided as grants or loans.
       (3) Use of funds.--A grant or loan provided under this 
     section may be used for a project relating to--
       (A) a certified engine configuration; or
       (B) a verified technology.

     SEC. 794. EVALUATION AND REPORT.

       (a) In General.--Not later than 1 year after the date on 
     which funds are made available under this subtitle, and 
     biennially thereafter,

[[Page 17862]]

     the Administrator shall submit to Congress a report 
     evaluating the implementation of the programs under this 
     subtitle.
       (b) Inclusions.--The report shall include a description 
     of--
       (1) the total number of grant applications received;
       (2) each grant or loan made under this subtitle, including 
     the amount of the grant or loan;
       (3) each project for which a grant or loan is provided 
     under this subtitle, including the criteria used to select 
     the grant or loan recipients;
       (4) the actual and estimated air quality and diesel fuel 
     conservation benefits, cost-effectiveness, and cost-benefits 
     of the grant and loan programs under this subtitle;
       (5) the problems encountered by projects for which a grant 
     or loan is provided under this subtitle; and
       (6) any other information the Administrator considers to be 
     appropriate.

     SEC. 795. OUTREACH AND INCENTIVES.

       (a) Definition of Eligible Technology.--In this section, 
     the term ``eligible technology'' means--
       (1) a verified technology; or
       (2) an emerging technology.
       (b) Technology Transfer Program.--
       (1) In general.--The Administrator shall establish a 
     program under which the Administrator--
       (A) informs stakeholders of the benefits of eligible 
     technologies; and
       (B) develops nonfinancial incentives to promote the use of 
     eligible technologies.
       (2) Eligible stakeholders.--Eligible stakeholders under 
     this section include--
       (A) equipment owners and operators;
       (B) emission and pollution control technology 
     manufacturers;
       (C) engine and equipment manufacturers;
       (D) State and local officials responsible for air quality 
     management;
       (E) community organizations; and
       (F) public health, educational, and environmental 
     organizations.
       (c) State Implementation Plans.--The Administrator shall 
     develop appropriate guidance to provide credit to a State for 
     emission reductions in the State created by the use of 
     eligible technologies through a State implementation plan 
     under section 110 of the Clean Air Act (42 U.S.C. 7410).
       (d) International Markets.--The Administrator, in 
     coordination with the Department of Commerce and industry 
     stakeholders, shall inform foreign countries with air quality 
     problems of the potential of technology developed or used in 
     the United States to provide emission reductions in those 
     countries.

     SEC. 796. EFFECT OF SUBTITLE.

       Nothing in this subtitle affects any authority under the 
     Clean Air Act (42 U.S.C. 7401 et seq.) in existence on the 
     day before the date of enactment of this Act.

     SEC. 797. AUTHORIZATION OF APPROPRIATIONS.

       There is authorized to be appropriated to carry out this 
     subtitle $200,000,000 for each of fiscal years 2007 through 
     2011, to remain available until expended.
                          TITLE VIII--HYDROGEN

     SEC. 801. HYDROGEN AND FUEL CELL PROGRAM.

       This title may be cited as the ``Spark M. Matsunaga 
     Hydrogen Act of 2005''.

     SEC. 802. PURPOSES.

       The purposes of this title are--
       (1) to enable and promote comprehensive development, 
     demonstration, and commercialization of hydrogen and fuel 
     cell technology in partnership with industry;
       (2) to make critical public investments in building strong 
     links to private industry, institutions of higher education, 
     National Laboratories, and research institutions to expand 
     innovation and industrial growth;
       (3) to build a mature hydrogen economy that creates fuel 
     diversity in the massive transportation sector of the United 
     States;
       (4) to sharply decrease the dependency of the United States 
     on imported oil, eliminate most emissions from the 
     transportation sector, and greatly enhance our energy 
     security; and
       (5) to create, strengthen, and protect a sustainable 
     national energy economy.

     SEC. 803. DEFINITIONS.

       In this title:
       (1) Fuel cell.--The term ``fuel cell'' means a device that 
     directly converts the chemical energy of a fuel, which is 
     supplied from an external source, and an oxidant into 
     electricity by electrochemical processes occurring at 
     separate electrodes in the device.
       (2) Heavy-duty vehicle.--The term ``heavy-duty vehicle'' 
     means a motor vehicle that--
       (A) is rated at more than 8,500 pounds gross vehicle 
     weight;
       (B) has a curb weight of more than 6,000 pounds; or
       (C) has a basic vehicle frontal area in excess of 45 square 
     feet.
       (3) Infrastructure.--The term ``infrastructure'' means the 
     equipment, systems, or facilities used to produce, 
     distribute, deliver, or store hydrogen (except for onboard 
     storage).
       (4) Light-duty vehicle.--The term ``light-duty vehicle'' 
     means a motor vehicle that is rated at 8,500 or less pounds 
     gross vehicle weight.
       (5) Stationary; portable.--The terms ``stationary'' and 
     ``portable'', when used in reference to a fuel cell, 
     include--
       (A) continuous electric power; and
       (B) backup electric power.
       (6) Task force.--The term ``Task Force'' means the Hydrogen 
     and Fuel Cell Technical Task Force established under section 
     806.
       (7) Technical advisory committee.--The term ``Technical 
     Advisory Committee'' means the independent Technical Advisory 
     Committee established under section 807.

     SEC. 804. PLAN.

       Not later than 6 months after the date of enactment of this 
     Act, the Secretary shall transmit to Congress a coordinated 
     plan for the programs described in this title and any other 
     programs of the Department that are directly related to fuel 
     cells or hydrogen. The plan shall describe, at a minimum--
       (1) the agenda for the next 5 years for the programs 
     authorized under this title, including the agenda for each 
     activity enumerated in section 805(e);
       (2) the types of entities that will carry out the 
     activities under this title and what role each entity is 
     expected to play;
       (3) the milestones that will be used to evaluate the 
     programs for the next 5 years;
       (4) the most significant technical and nontechnical hurdles 
     that stand in the way of achieving the goals described in 
     section 805, and how the programs will address those hurdles; 
     and
       (5) the policy assumptions that are implicit in the plan, 
     including any assumptions that would affect the sources of 
     hydrogen or the marketability of hydrogen-related products.

     SEC. 805. PROGRAMS.

       (a) In General.--The Secretary, in consultation with other 
     Federal agencies and the private sector, shall conduct a 
     research and development program on technologies relating to 
     the production, purification, distribution, storage, and use 
     of hydrogen energy, fuel cells, and related infrastructure.
       (b) Goal.--The goal of the program shall be to demonstrate 
     and commercialize the use of hydrogen for transportation (in 
     light-duty vehicles and heavy-duty vehicles), utility, 
     industrial, commercial, and residential applications.
       (c) Focus.--In carrying out activities under this section, 
     the Secretary shall focus on factors that are common to the 
     development of hydrogen infrastructure and the supply of 
     vehicle and electric power for critical consumer and 
     commercial applications, and that achieve continuous 
     technical evolution and cost reduction, particularly for 
     hydrogen production, the supply of hydrogen, storage of 
     hydrogen, and end uses of hydrogen that--
       (1) steadily increase production, distribution, and end use 
     efficiency and reduce life-cycle emissions;
       (2) resolve critical problems relating to catalysts, 
     membranes, storage, lightweight materials, electronic 
     controls, manufacturability, and other problems that emerge 
     from the program;
       (3) enhance sources of renewable fuels and biofuels for 
     hydrogen production; and
       (4) enable widespread use of distributed electricity 
     generation and storage.
       (d) Public Education and Research.--In carrying out this 
     section, the Secretary shall support enhanced public 
     education and research conducted at institutions of higher 
     education in fundamental sciences, application design, and 
     systems concepts (including education and research relating 
     to materials, subsystems, manufacturability, maintenance, and 
     safety) relating to hydrogen and fuel cells.
       (e) Activities.--The Secretary, in partnership with the 
     private sector, shall conduct programs to address--
       (1) production of hydrogen from diverse energy sources, 
     including--
       (A) fossil fuels, which may include carbon capture and 
     sequestration;
       (B) hydrogen-carrier fuels (including ethanol and 
     methanol);
       (C) renewable energy resources, including biomass; and
       (D) nuclear energy;
       (2) use of hydrogen for commercial, industrial, and 
     residential electric power generation;
       (3) safe delivery of hydrogen or hydrogen-carrier fuels, 
     including--
       (A) transmission by pipeline and other distribution 
     methods; and
       (B) convenient and economic refueling of vehicles either at 
     central refueling stations or through distributed onsite 
     generation;
       (4) advanced vehicle technologies, including--
       (A) engine and emission control systems;
       (B) energy storage, electric propulsion, and hybrid 
     systems;
       (C) automotive materials; and
       (D) other advanced vehicle technologies;
       (5) storage of hydrogen or hydrogen-carrier fuels, 
     including development of materials for safe and economic 
     storage in gaseous, liquid, or solid form at refueling 
     facilities and onboard vehicles;
       (6) development of safe, durable, affordable, and efficient 
     fuel cells, including fuel-flexible fuel cell power systems, 
     improved manufacturing processes, high-temperature membranes, 
     cost-effective fuel processing for natural gas, fuel cell 
     stack and system reliability, low temperature operation, and 
     cold start capability; and
       (7) the ability of domestic automobile manufacturers to 
     manufacture commercially available competitive hybrid vehicle 
     technologies in the United States.
       (f) Program Goals.--
       (1) Vehicles.--For vehicles, the goals of the program are--
       (A) to enable a commitment by automakers no later than year 
     2015 to offer safe, affordable, and technically viable 
     hydrogen fuel cell vehicles in the mass consumer market; and

[[Page 17863]]

       (B) to enable production, delivery, and acceptance by 
     consumers of model year 2020 hydrogen fuel cell and other 
     hydrogen-powered vehicles that will have, when compared to 
     light duty vehicles in model year 2005--
       (i) fuel economy that is substantially higher;
       (ii) substantially lower emissions of air pollutants; and
       (iii) equivalent or improved vehicle fuel system crash 
     integrity and occupant protection.
       (2) Hydrogen energy and energy infrastructure.--For 
     hydrogen energy and energy infrastructure, the goals of the 
     program are to enable a commitment not later than 2015 that 
     will lead to infrastructure by 2020 that will provide--
       (A) safe and convenient refueling;
       (B) improved overall efficiency;
       (C) widespread availability of hydrogen from domestic 
     energy sources through--
       (i) production, with consideration of emissions levels;
       (ii) delivery, including transmission by pipeline and other 
     distribution methods for hydrogen; and
       (iii) storage, including storage in surface transportation 
     vehicles;
       (D) hydrogen for fuel cells, internal combustion engines, 
     and other energy conversion devices for portable, stationary, 
     micro, critical needs facilities, and transportation 
     applications; and
       (E) other technologies consistent with the Department's 
     plan.
       (3) Fuel cells.--The goals for fuel cells and their 
     portable, stationary, and transportation applications are to 
     enable--
       (A) safe, economical, and environmentally sound hydrogen 
     fuel cells;
       (B) fuel cells for light duty and other vehicles; and
       (C) other technologies consistent with the Department's 
     plan.
       (g) Funding.--
       (1) In general.--The Secretary shall carry out the programs 
     under this section using a competitive, merit-based review 
     process and consistent with the generally applicable Federal 
     laws and regulations governing awards of financial 
     assistance, contracts, or other agreements.
       (2) Research centers.--Activities under this section may be 
     carried out by funding nationally recognized university-based 
     or Federal laboratory research centers.
       (h) Hydrogen Supply.--There are authorized to be 
     appropriated to carry out projects and activities relating to 
     hydrogen production, storage, distribution and dispensing, 
     transport, education and coordination, and technology 
     transfer under this section--
       (1) $160,000,000 for fiscal year 2006;
       (2) $200,000,000 for fiscal year 2007;
       (3) $220,000,000 for fiscal year 2008;
       (4) $230,000,000 for fiscal year 2009;
       (5) $250,000,000 for fiscal year 2010; and
       (6) such sums as are necessary for each of fiscal years 
     2011 through 2020.

     SEC. 806. HYDROGEN AND FUEL CELL TECHNICAL TASK FORCE.

       (a) Establishment.--Not later than 120 days after the date 
     of enactment of this Act, the President shall establish an 
     interagency task force chaired by the Secretary with 
     representatives from each of the following:
       (1) The Office of Science and Technology Policy within the 
     Executive Office of the President.
       (2) The Department of Transportation.
       (3) The Department of Defense.
       (4) The Department of Commerce (including the National 
     Institute of Standards and Technology).
       (5) The Department of State.
       (6) The Environmental Protection Agency.
       (7) The National Aeronautics and Space Administration.
       (8) Other Federal agencies as the Secretary determines 
     appropriate.
       (b) Duties.--
       (1) Planning.--The Task Force shall work toward--
       (A) a safe, economical, and environmentally sound fuel 
     infrastructure for hydrogen and hydrogen-carrier fuels, 
     including an infrastructure that supports buses and other 
     fleet transportation;
       (B) fuel cells in government and other applications, 
     including portable, stationary, and transportation 
     applications;
       (C) distributed power generation, including the generation 
     of combined heat, power, and clean fuels including hydrogen;
       (D) uniform hydrogen codes, standards, and safety 
     protocols; and
       (E) vehicle hydrogen fuel system integrity safety 
     performance.
       (2) Activities.--The Task Force may organize workshops and 
     conferences, may issue publications, and may create databases 
     to carry out its duties. The Task Force shall--
       (A) foster the exchange of generic, nonproprietary 
     information and technology among industry, academia, and 
     government;
       (B) develop and maintain an inventory and assessment of 
     hydrogen, fuel cells, and other advanced technologies, 
     including the commercial capability of each technology for 
     the economic and environmentally safe production, 
     distribution, delivery, storage, and use of hydrogen;
       (C) integrate technical and other information made 
     available as a result of the programs and activities under 
     this title;
       (D) promote the marketplace introduction of infrastructure 
     for hydrogen fuel vehicles; and
       (E) conduct an education program to provide hydrogen and 
     fuel cell information to potential end-users.
       (c) Agency Cooperation.--The heads of all agencies, 
     including those whose agencies are not represented on the 
     Task Force, shall cooperate with and furnish information to 
     the Task Force, the Technical Advisory Committee, and the 
     Department.

     SEC. 807. TECHNICAL ADVISORY COMMITTEE.

       (a) Establishment.--The Hydrogen Technical and Fuel Cell 
     Advisory Committee is established to advise the Secretary on 
     the programs and activities under this title.
       (b) Membership.--
       (1) Members.--The Technical Advisory Committee shall be 
     comprised of not fewer than 12 nor more than 25 members. The 
     members shall be appointed by the Secretary to represent 
     domestic industry, academia, professional societies, 
     government agencies, Federal laboratories, previous advisory 
     panels, and financial, environmental, and other appropriate 
     organizations based on the Department's assessment of the 
     technical and other qualifications of Technical Advisory 
     Committee members and the needs of the Technical Advisory 
     Committee.
       (2) Terms.--The term of a member of the Technical Advisory 
     Committee shall not be more than 3 years. The Secretary may 
     appoint members of the Technical Advisory Committee in a 
     manner that allows the terms of the members serving at any 
     time to expire at spaced intervals so as to ensure continuity 
     in the functioning of the Technical Advisory Committee. A 
     member of the Technical Advisory Committee whose term is 
     expiring may be reappointed.
       (3) Chairperson.--The Technical Advisory Committee shall 
     have a chairperson, who shall be elected by the members from 
     among their number.
       (c) Review.--The Technical Advisory Committee shall review 
     and make recommendations to the Secretary on--
       (1) the implementation of programs and activities under 
     this title;
       (2) the safety, economical, and environmental consequences 
     of technologies for the production, distribution, delivery, 
     storage, or use of hydrogen energy and fuel cells; and
       (3) the plan under section 804.
       (d) Response.--
       (1) Consideration of recommendations.--The Secretary shall 
     consider, but need not adopt, any recommendations of the 
     Technical Advisory Committee under subsection (c).
       (2) Biennial report.--The Secretary shall transmit a 
     biennial report to Congress describing any recommendations 
     made by the Technical Advisory Committee since the previous 
     report. The report shall include a description of how the 
     Secretary has implemented or plans to implement the 
     recommendations, or an explanation of the reasons that a 
     recommendation will not be implemented. The report shall be 
     transmitted along with the President's budget proposal.
       (e) Support.--The Secretary shall provide resources 
     necessary in the judgment of the Secretary for the Technical 
     Advisory Committee to carry out its responsibilities under 
     this title.

     SEC. 808. DEMONSTRATION.

       (a) In General.--In carrying out the programs under this 
     section, the Secretary shall fund a limited number of 
     demonstration projects, consistent with this title and a 
     determination of the maturity, cost-effectiveness, and 
     environmental impacts of technologies supporting each 
     project. In selecting projects under this subsection, the 
     Secretary shall, to the extent practicable and in the public 
     interest, select projects that--
       (1) involve using hydrogen and related products at existing 
     facilities or installations, such as existing office 
     buildings, military bases, vehicle fleet centers, transit bus 
     authorities, or units of the National Park System;
       (2) depend on reliable power from hydrogen to carry out 
     essential activities;
       (3) lead to the replication of hydrogen technologies and 
     draw such technologies into the marketplace;
       (4) include vehicle, portable, and stationary 
     demonstrations of fuel cell and hydrogen-based energy 
     technologies;
       (5) address the interdependency of demand for hydrogen fuel 
     cell applications and hydrogen fuel infrastructure;
       (6) raise awareness of hydrogen technology among the 
     public;
       (7) facilitate identification of an optimum technology 
     among competing alternatives;
       (8) address distributed generation using renewable sources;
       (9) carry out demonstrations of evolving hydrogen and fuel 
     cell technologies in national parks, remote island areas, and 
     on Indian tribal land, as selected by the Secretary;
       (10) carry out a program to demonstrate developmental 
     hydrogen and fuel cell systems for mobile, portable, and 
     stationary uses, using improved versions of the learning 
     demonstrations program concept of the Department including 
     demonstrations involving--
       (A) light-duty vehicles;
       (B) heavy-duty vehicles;
       (C) fleet vehicles;
       (D) specialty industrial and farm vehicles; and
       (E) commercial and residential portable, continuous, and 
     backup electric power generation;
       (11) in accordance with any code or standards developed in 
     a region, fund prototype, pilot fleet, and infrastructure 
     regional hydrogen supply corridors along the interstate 
     highway system in varied climates across the United States; 
     and
       (12) fund demonstration programs that explore the use of 
     hydrogen blends, hybrid hydrogen,

[[Page 17864]]

     and hydrogen reformed from renewable agricultural fuels, 
     including the use of hydrogen in hybrid electric, heavier 
     duty, and advanced internal combustion-powered vehicles.
     The Secretary shall give preference to projects which address 
     multiple elements contained in paragraphs (1) through (12).
       (b) System Demonstrations.--
       (1) In general.--As a component of the demonstration 
     program under this section, the Secretary shall provide 
     grants, on a cost share basis as appropriate, to eligible 
     entities (as determined by the Secretary) for use in--
       (A) devising system design concepts that provide for the 
     use of advanced composite vehicles in programs under section 
     782 that--
       (i) have as a primary goal the reduction of drive energy 
     requirements;
       (ii) after 2010, add another research and development 
     phase, as defined in subsection (c), including the vehicle 
     and infrastructure partnerships developed under the learning 
     demonstrations program concept of the Department; and
       (iii) are managed through an enhanced FreedomCAR program 
     within the Department that encourages involvement in cost-
     shared projects by manufacturers and governments; and
       (B) designing a local distributed energy system that--
       (i) incorporates renewable hydrogen production, off-grid 
     electricity production, and fleet applications in industrial 
     or commercial service;
       (ii) integrates energy or applications described in clause 
     (i), such as stationary, portable, micro, and mobile fuel 
     cells, into a high-density commercial or residential building 
     complex or agricultural community; and
       (iii) is managed in cooperation with industry, State, 
     tribal, and local governments, agricultural organizations, 
     and nonprofit generators and distributors of electricity.
       (c) Identification of New Program Requirements.--In 
     carrying out the demonstrations under subsection (a), the 
     Secretary, in consultation with the Task Force and the 
     Technical Advisory Committee, shall--
       (1) after 2008 for stationary and portable applications, 
     and after 2010 for vehicles, identify new requirements that 
     refine technological concepts, planning, and applications; 
     and
       (2) during the second phase of the learning demonstrations 
     under subsection (b)(1)(A)(ii), redesign subsequent program 
     work to incorporate those requirements.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section--
       (1) $185,000,000 for fiscal year 2006;
       (2) $200,000,000 for fiscal year 2007;
       (3) $250,000,000 for fiscal year 2008;
       (4) $300,000,000 for fiscal year 2009;
       (5) $375,000,000 for fiscal year 2010; and
       (6) such sums as are necessary for each of fiscal years 
     2011 through 2020.

     SEC. 809. CODES AND STANDARDS.

       (a) In General.--The Secretary, in cooperation with the 
     Task Force, shall provide grants to, or offer to enter into 
     contracts with, such professional organizations, public 
     service organizations, and government agencies as the 
     Secretary determines appropriate to support timely and 
     extensive development of safety codes and standards relating 
     to fuel cell vehicles, hydrogen energy systems, and 
     stationary, portable, and micro fuel cells.
       (b) Educational Efforts.--The Secretary shall support 
     educational efforts by organizations and agencies described 
     in subsection (a) to share information, including information 
     relating to best practices, among those organizations and 
     agencies.
       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section--
       (1) $4,000,000 for fiscal year 2006;
       (2) $7,000,000 for fiscal year 2007;
       (3) $8,000,000 for fiscal year 2008;
       (4) $10,000,000 for fiscal year 2009;
       (5) $9,000,000 for fiscal year 2010; and
       (6) such sums as are necessary for each of fiscal years 
     2011 through 2020.

     SEC. 810. DISCLOSURE.

       Section 623 of the Energy Policy Act of 1992 (42 U.S.C. 
     13293) shall apply to any project carried out through a 
     grant, cooperative agreement, or contract under this title.

     SEC. 811. REPORTS.

       (a) Secretary.--Subject to subsection (c), not later than 2 
     years after the date of enactment of this Act, and 
     triennially thereafter, the Secretary shall submit to 
     Congress a report describing--
       (1) activities carried out by the Department under this 
     title, for hydrogen and fuel cell technology;
       (2) measures the Secretary has taken during the preceding 3 
     years to support the transition of primary industry (or a 
     related industry) to a fully commercialized hydrogen economy;
       (3) any change made to the strategy relating to hydrogen 
     and fuel cell technology to reflect the results of a learning 
     demonstrations;
       (4) progress, including progress in infrastructure, made 
     toward achieving the goal of producing and deploying not less 
     than--
       (A) 100,000 hydrogen-fueled vehicles in the United States 
     by 2010; and
       (B) 2,500,000 hydrogen-fueled vehicles in the United States 
     by 2020;
       (5) progress made toward achieving the goal of supplying 
     hydrogen at a sufficient number of fueling stations in the 
     United States by 2010 including by integrating--
       (A) hydrogen activities; and
       (B) associated targets and timetables for the development 
     of hydrogen technologies;
       (6) any problem relating to the design, execution, or 
     funding of a program under this title;
       (7) progress made toward and goals achieved in carrying out 
     this title and updates to the developmental roadmap, 
     including the results of the reviews conducted by the 
     National Academy of Sciences under subsection (b) for the 
     fiscal years covered by the report; and
       (8) any updates to strategic plans that are necessary to 
     meet the goals described in paragraph (4).
       (b) External Review.--The Secretary shall enter into an 
     arrangement with the National Academy of Sciences under which 
     the Academy will review the programs under sections 805 and 
     808 every fourth year following the date of enactment of this 
     Act. The Academy's review shall include the program 
     priorities and technical milestones, and evaluate the 
     progress toward achieving them. The first review shall be 
     completed not later than 5 years after the date of enactment 
     of this Act. Not later than 45 days after receiving the 
     review, the Secretary shall transmit the review to Congress 
     along with a plan to implement the review's recommendations 
     or an explanation for the reasons that a recommendation will 
     not be implemented.
       (c) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $1,500,000 for 
     each of fiscal years 2006 through 2020.

     SEC. 812. SOLAR AND WIND TECHNOLOGIES.

       (a) Solar Energy Technologies.--The Secretary shall--
       (1) prepare a detailed roadmap for carrying out the 
     provisions in this title related to solar energy technologies 
     and for implementing the recommendations related to solar 
     energy technologies that are included in the report 
     transmitted under subsection (e);
       (2) provide for the establishment of 5 projects in 
     geographic areas that are regionally and climatically diverse 
     to demonstrate the production of hydrogen at solar energy 
     facilities, including one demonstration project at a National 
     Laboratory or institution of higher education;
       (3) establish a program--
       (A) to develop optimized concentrating solar power devices 
     that may be used for the production of both electricity and 
     hydrogen; and
       (B) to evaluate the use of thermochemical cycles for 
     hydrogen production at the temperatures attainable with 
     concentrating solar power devices;
       (4) coordinate with activities sponsored by the 
     Department's Office of Nuclear Energy, Science, and 
     Technology on high-temperature materials, thermochemical 
     cycles, and economic issues related to solar energy;
       (5) provide for the construction and operation of new 
     concentrating solar power devices or solar power cogeneration 
     facilities that produce hydrogen either concurrently with, or 
     independently of, the production of electricity;
       (6) support existing facilities and programs of study 
     related to concentrating solar power devices; and
       (7) establish a program--
       (A) to develop methods that use electricity from 
     photovoltaic devices for the onsite production of hydrogen, 
     such that no intermediate transmission or distribution 
     infrastructure is required or used and future demand growth 
     may be accommodated;
       (B) to evaluate the economics of small-scale electrolysis 
     for hydrogen production; and
       (C) to study the potential of modular photovoltaic devices 
     for the development of a hydrogen infrastructure, the 
     security implications of a hydrogen infrastructure, and the 
     benefits potentially derived from a hydrogen infrastructure.
       (b) Wind Energy Technologies.--The Secretary shall--
       (1) prepare a detailed roadmap for carrying out the 
     provisions in this title related to wind energy technologies 
     and for implementing the recommendations related to wind 
     energy technologies that are included in the report 
     transmitted under subsection (e); and
       (2) provide for the establishment of 5 projects in 
     geographic areas that are regionally and climatically diverse 
     to demonstrate the production of hydrogen at existing wind 
     energy facilities, including one demonstration project at a 
     National Laboratory or institution of higher education.
       (c) Program Support.--The Secretary shall support programs 
     at institutions of higher education for the development of 
     solar energy technologies and wind energy technologies for 
     the production of hydrogen. The programs supported under this 
     subsection shall--
       (1) enhance fellowship and faculty assistance programs;
       (2) provide support for fundamental research;
       (3) encourage collaborative research among industry, 
     National Laboratories, and institutions of higher education;
       (4) support communication and outreach; and
       (5) to the greatest extent possible--
       (A) be located in geographic areas that are regionally and 
     climatically diverse; and
       (B) be located at part B institutions, minority 
     institutions, and institutions of higher education located in 
     States participating in the Experimental Program to Stimulate 
     Competitive Research of the Department.
       (d) Institutions of Higher Education and National 
     Laboratory Interactions.--In conjunction with the programs 
     supported under this section, the Secretary shall develop 
     sabbatical, fellowship, and visiting scientist programs to 
     encourage National Laboratories and institutions of higher 
     education to share and exchange personnel.
       (e) Report.--The Secretary shall transmit to the Congress 
     not later than 120 days after the

[[Page 17865]]

     date of enactment of this Act a report containing detailed 
     summaries of the roadmaps prepared under subsections (a)(1) 
     and (b)(1), descriptions of the Secretary's progress in 
     establishing the projects and other programs required under 
     this section, and recommendations for promoting the 
     availability of advanced solor and wind energy technologies 
     for the production of hydrogen.
       (f) Definitions.--For purposes of this section--
       (1) the term ``concentrating solar power devices'' means 
     devices that concentrate the power of the sun by reflection 
     or refraction to improve the efficiency of a photovoltaic or 
     thermal generation process;
       (2) the term ``minority institution'' has the meaning given 
     to that term in section 365 of the Higher Education Act of 
     1965 (20 U.S.C. 1067k);
       (3) the term ``part B institution'' has the meaning given 
     to that term in section 322 of the Higher Education Act of 
     1965 (20 U.S.C. 1061); and
       (4) the term ``photovoltaic devices'' means devices that 
     convert light directly into electricity through a solid-
     state, semiconductor process.
       (g) Authorization of Appropriations.--There is authorized 
     to be appropriated such sums as are necessary for carrying 
     out the activities under this section for each of fiscal 
     years 2006 through 2020.

     SEC. 813. TECHNOLOGY TRANSFER.

       In carrying out this title, the Secretary shall carry out 
     programs that--
       (1) provide for the transfer of critical hydrogen and fuel 
     cell technologies to the private sector;
       (2) accelerate wider application of those technologies in 
     the global market;
       (3) foster the exchange of generic, nonproprietary 
     information; and
       (4) assess technical and commercial viability of 
     technologies relating to the production, distribution, 
     storage, and use of hydrogen energy and fuel cells.

     SEC. 814. MISCELLANEOUS PROVISIONS.

       (a) Representation.--The Secretary may represent the United 
     States interests with respect to activities and programs 
     under this title, in coordination with the Department of 
     Transportation, the National Institute of Standards and 
     Technology, and other relevant Federal agencies, before 
     governments and nongovernmental organizations including--
       (1) other Federal, State, regional, and local governments 
     and their representatives;
       (2) industry and its representatives, including members of 
     the energy and transportation industries; and
       (3) in consultation with the Department of State, foreign 
     governments and their representatives including international 
     organizations.
       (b) Regulatory Authority.--Nothing in this title shall be 
     construed to alter the regulatory authority of the 
     Department.

     SEC. 815. COST SHARING.

       The costs of carrying out projects and activities under 
     this title shall be shared in accordance with section 988.

     SEC. 816. SAVINGS CLAUSE.

       Nothing in this title shall be construed to affect the 
     authority of the Secretary of Transportation that may exist 
     prior to the date of enactment of this Act with respect to--
       (1) research into, and regulation of, hydrogen-powered 
     vehicles fuel systems integrity, standards, and safety under 
     subtitle VI of title 49, United States Code;
       (2) regulation of hazardous materials transportation under 
     chapter 51 of title 49, United States Code;
       (3) regulation of pipeline safety under chapter 601 of 
     title 49, United States Code;
       (4) encouragement and promotion of research, development, 
     and deployment activities relating to advanced vehicle 
     technologies under section 5506 of title 49, United States 
     Code;
       (5) regulation of motor vehicle safety under chapter 301 of 
     title 49, United States Code;
       (6) automobile fuel economy under chapter 329 of title 49, 
     United States Code; or
       (7) representation of the interests of the United States 
     with respect to the activities and programs under the 
     authority of title 49, United States Code.
                   TITLE IX--RESEARCH AND DEVELOPMENT

     SEC. 901. SHORT TITLE.

       This title may be cited as the ``Energy Research, 
     Development, Demonstration, and Commercial Application Act of 
     2005''.

     SEC. 902. GOALS.

       (a) In General.--In order to achieve the purposes of this 
     title, the Secretary shall conduct a balanced set of programs 
     of energy research, development, demonstration, and 
     commercial application with the general goals of--
       (1) increasing the efficiency of all energy intensive 
     sectors through conservation and improved technologies;
       (2) promoting diversity of energy supply;
       (3) decreasing the dependence of the United States on 
     foreign energy supplies;
       (4) improving the energy security of the United States; and
       (5) decreasing the environmental impact of energy-related 
     activities.
       (b) Goals.--The Secretary shall publish measurable cost and 
     performance-based goals, comparable over time, with each 
     annual budget submission in at least the following areas:
       (1) Energy efficiency for buildings, energy-consuming 
     industries, and vehicles.
       (2) Electric energy generation (including distributed 
     generation), transmission, and storage.
       (3) Renewable energy technologies, including wind power, 
     photovoltaics, solar thermal systems, geothermal energy, 
     hydrogen-fueled systems, biomass-based systems, biofuels, and 
     hydropower.
       (4) Fossil energy, including power generation, onshore and 
     offshore oil and gas resource recovery, and transportation 
     fuels.
       (5) Nuclear energy, including programs for existing and 
     advanced reactors, and education of future specialists.
       (c) Public Comment.--The Secretary shall provide mechanisms 
     for input on the annually published goals from industry, 
     institutions of higher education, and other public sources.
       (d) Effect of Goals.--Nothing in subsection (a) or the 
     annually published goals creates any new authority for any 
     Federal agency, or may be used by any Federal agency, to 
     support the establishment of regulatory standards or 
     regulatory requirements.

     SEC. 903. DEFINITIONS.

       In this title:
       (1) Departmental mission.--The term ``departmental 
     mission'' means any of the functions vested in the Secretary 
     by the Department of Energy Organization Act (42 U.S.C. 7101 
     et seq.) or other law.
       (2) Hispanic-serving institution.--The term ``Hispanic-
     serving institution'' has the meaning given the term in 
     section 502(a) of the Higher Education Act of 1965 (20 U.S.C. 
     1101a(a)).
       (3) Nonmilitary energy laboratory.--The term ``nonmilitary 
     energy laboratory'' means a National Laboratory other than a 
     National Laboratory listed in subparagraph (G), (H), or (N) 
     of section 2(3).
       (4) Part b institution.--The term ``part B institution'' 
     has the meaning given the term in section 322 of the Higher 
     Education Act of 1965 (20 U.S.C. 1061).
       (5) Single-purpose research facility.--The term ``single-
     purpose research facility'' means--
       (A) any of the primarily single-purpose entities owned by 
     the Department; or
       (B) any other organization of the Department designated by 
     the Secretary.
       (6) University.--The term ``university'' has the meaning 
     given the term ``institution of higher education'' in section 
     101 of the Higher Education Act of 1965 (20 U.S.C. 1001).
                     Subtitle A--Energy Efficiency

     SEC. 911. ENERGY EFFICIENCY.

       (a) In General.--
       (1) Objectives.--The Secretary shall conduct programs of 
     energy efficiency research, development, demonstration, and 
     commercial application, including activities described in 
     this subtitle. Such programs shall take into consideration 
     the following objectives:
       (A) Increasing the energy efficiency of vehicles, 
     buildings, and industrial processes.
       (B) Reducing the demand of the United States for energy, 
     especially energy from foreign sources.
       (C) Reducing the cost of energy and making the economy more 
     efficient and competitive.
       (D) Improving the energy security of the United States.
       (E) Reducing the environmental impact of energy-related 
     activities.
       (2) Programs.--Programs under this subtitle shall include 
     research, development, demonstration, and commercial 
     application of--
       (A) advanced, cost-effective technologies to improve the 
     energy efficiency and environmental performance of vehicles, 
     including--
       (i) hybrid and electric propulsion systems;
       (ii) plug-in hybrid systems;
       (iii) advanced combustion engines;
       (iv) weight and drag reduction technologies;
       (v) whole-vehicle design optimization; and
       (vi) advanced drive trains;
       (B) cost-effective technologies, for new construction and 
     retrofit, to improve the energy efficiency and environmental 
     performance of buildings, using a whole-buildings approach, 
     including onsite renewable energy generation;
       (C) advanced technologies to improve the energy efficiency, 
     environmental performance, and process efficiency of energy-
     intensive and waste-intensive industries; and
       (D) advanced control devices to improve the energy 
     efficiency of electric motors, including those used in 
     industrial processes, heating, ventilation, and cooling.
       (b) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary to carry out energy 
     efficiency and conservation research, development, 
     demonstration, and commercial application activities, 
     including activities authorized under this subtitle--
       (1) $783,000,000 for fiscal year 2007;
       (2) $865,000,000 for fiscal year 2008; and
       (3) $952,000,000 for fiscal year 2009.
       (c) Allocations.--From amounts authorized under subsection 
     (b), the following sums are authorized:
       (1) For activities under section 912, $50,000,000 for each 
     of fiscal years 2007 through 2009.
       (2) For activities under section 915, $7,000,000 for each 
     of fiscal years 2007 through 2009.
       (3) For activities under subsection (a)(2)(A)--
       (A) $200,000,000 for fiscal year 2007;
       (B) $270,000,000 for fiscal year 2008; and
       (C) $310,000,000 for fiscal year 2009.
       (4) For activities under subsection (a)(2)(D), $2,000,000 
     for each of fiscal years 2007 and 2008.
       (d) Extended Authorization.--There are authorized to be 
     appropriated to the Secretary to carry out section 912 
     $50,000,000 for each of fiscal years 2010 through 2013.
       (e) Limitations.--None of the funds authorized to be 
     appropriated under this section may be used for--
       (1) the issuance or implementation of energy efficiency 
     regulations;

[[Page 17866]]

       (2) the weatherization program established under part A of 
     title IV of the Energy Conservation and Production Act (42 
     U.S.C. 6861 et seq.);
       (3) a State energy conservation plan established under part 
     D of title III of the Energy Policy and Conservation Act (42 
     U.S.C. 6321 et seq.); or
       (4) a Federal energy management measure carried out under 
     part 3 of title V of the National Energy Conservation Policy 
     Act (42 U.S.C. 8251 et seq.).

     SEC. 912. NEXT GENERATION LIGHTING INITIATIVE.

       (a) Definitions.--In this section:
       (1) Advanced solid-state lighting.--The term ``advanced 
     solid-state lighting'' means a semiconducting device package 
     and delivery system that produces white light using 
     externally applied voltage.
       (2) Industry alliance.--The term ``Industry Alliance'' 
     means an entity selected by the Secretary under subsection 
     (d).
       (3) Initiative.--The term ``Initiative'' means the Next 
     Generation Lighting Initiative carried out under this 
     section.
       (4) Research.--The term ``research'' includes research on 
     the technologies, materials, and manufacturing processes 
     required for white light emitting diodes.
       (5) White light emitting diode.--The term ``white light 
     emitting diode'' means a semiconducting package, using either 
     organic or inorganic materials, that produces white light 
     using externally applied voltage.
       (b) Initiative.--The Secretary shall carry out a Next 
     Generation Lighting Initiative in accordance with this 
     section to support research, development, demonstration, and 
     commercial application activities related to advanced solid-
     state lighting technologies based on white light emitting 
     diodes.
       (c) Objectives.--The objectives of the Initiative shall be 
     to develop advanced solid-state organic and inorganic 
     lighting technologies based on white light emitting diodes 
     that, compared to incandescent and fluorescent lighting 
     technologies, are longer lasting, are more energy-efficient 
     and cost-competitive, and have less environmental impact.
       (d) Industry Alliance.--Not later than 90 days after the 
     date of enactment of this Act, the Secretary shall 
     competitively select an Industry Alliance to represent 
     participants who are private, for-profit firms, open to large 
     and small businesses, that, as a group, are broadly 
     representative of United States solid state lighting 
     research, development, infrastructure, and manufacturing 
     expertise as a whole.
       (e) Research.--
       (1) Grants.--The Secretary shall carry out the research 
     activities of the Initiative through competitively awarded 
     grants to--
       (A) researchers, including Industry Alliance participants;
       (B) small businesses;
       (C) National Laboratories; and
       (D) institutions of higher education.
       (2) Industry alliance.--The Secretary shall annually 
     solicit from the Industry Alliance--
       (A) comments to identify solid-state lighting technology 
     needs;
       (B) an assessment of the progress of the research 
     activities of the Initiative; and
       (C) assistance in annually updating solid-state lighting 
     technology roadmaps.
       (3) Availability to public.--The information and roadmaps 
     under paragraph (2) shall be available to the public.
       (f) Development, Demonstration, and Commercial 
     Application.--
       (1) In general.--The Secretary shall carry out a 
     development, demonstration, and commercial application 
     program for the Initiative through competitively selected 
     awards.
       (2) Preference.--In making the awards, the Secretary may 
     give preference to participants in the Industry Alliance.
       (g) Cost Sharing.--In carrying out this section, the 
     Secretary shall require cost sharing in accordance with 
     section 988.
       (h) Intellectual Property.--The Secretary may require (in 
     accordance with section 202(a)(ii) of title 35, United States 
     Code, section 152 of the Atomic Energy Act of 1954 (42 U.S.C. 
     2182), and section 9 of the Federal Nonnuclear Energy 
     Research and Development Act of 1974 (42 U.S.C. 5908)) that 
     for any new invention developed under subsection (e)--
       (1) that the Industry Alliance participants who are active 
     participants in research, development, and demonstration 
     activities related to the advanced solid-state lighting 
     technologies that are covered by this section shall be 
     granted the first option to negotiate with the invention 
     owner, at least in the field of solid-state lighting, 
     nonexclusive licenses and royalties on terms that are 
     reasonable under the circumstances;
       (2)(A) that, for 1 year after a United States patent is 
     issued for the invention, the patent holder shall not 
     negotiate any license or royalty with any entity that is not 
     a participant in the Industry Alliance described in paragraph 
     (1); and
       (B) that, during the year described in subparagraph (A), 
     the patent holder shall negotiate nonexclusive licenses and 
     royalties in good faith with any interested participant in 
     the Industry Alliance described in paragraph (1); and
       (3) such other terms as the Secretary determines are 
     required to promote accelerated commercialization of 
     inventions made under the Initiative.
       (i) National Academy Review.--The Secretary shall enter 
     into an arrangement with the National Academy of Sciences to 
     conduct periodic reviews of the Initiative.

     SEC. 913. NATIONAL BUILDING PERFORMANCE INITIATIVE.

       (a) Interagency Group.--
       (1) In general.--Not later than 90 days after the date of 
     enactment of this Act, the Director of the Office of Science 
     and Technology Policy shall establish an interagency group to 
     develop, in coordination with the advisory committee 
     established under subsection (e), a National Building 
     Performance Initiative (referred to in this section as the 
     ``Initiative'').
       (2) Cochairs.--The interagency group shall be co-chaired by 
     appropriate officials of the Department and the Department of 
     Commerce, who shall jointly arrange for the provision of 
     necessary administrative support to the group.
       (b) Integration of Efforts.--The Initiative shall integrate 
     Federal, State, and voluntary private sector efforts to 
     reduce the costs of construction, operation, maintenance, and 
     renovation of commercial, industrial, institutional, and 
     residential buildings.
       (c) Plan.--
       (1) In general.--Not later than 1 year after the date of 
     enactment of this Act, the interagency group shall submit to 
     Congress a plan for carrying out the appropriate Federal role 
     in the Initiative.
       (2) Inclusions.--The plan shall include--
       (A) research, development, demonstration, and commercial 
     application of energy technology systems and materials for 
     new construction and retrofit relating to the building 
     envelope and building system components;
       (B) research, development, demonstration, and commercial 
     application of energy technology and infrastructure enabling 
     the energy efficient, automated operation of buildings and 
     building equipment; and
       (C) the collection, analysis, and dissemination of research 
     results and other pertinent information on enhancing building 
     performance to industry, government entities, and the public.
       (d) Department of Energy Role.--Within the Federal portion 
     of the Initiative, the Department shall be the lead agency 
     for all aspects of building performance related to use and 
     conservation of energy.
       (e) Advisory Committee.--The Director of the Office of 
     Science and Technology Policy shall establish an advisory 
     committee to--
       (1) analyze and provide recommendations on potential 
     private sector roles and participation in the Initiative; and
       (2) review and provide recommendations on the plan 
     described in subsection (c).
       (f) Administration.--Nothing in this section provides any 
     Federal agency with new authority to regulate building 
     performance.

     SEC. 914. BUILDING STANDARDS.

       (a) Definition of High Performance Building.--In this 
     section, the term ``high performance building'' means a 
     building that integrates and optimizes all major high-
     performance building attributes, including energy efficiency, 
     durability, life-cycle performance, and occupant 
     productivity.
       (b) Assessment.--Not later than 120 days after the date of 
     enactment of this Act, the Secretary shall enter into an 
     agreement with the National Institute of Building Sciences 
     to--
       (1) conduct an assessment (in cooperation with industry, 
     standards development organizations, and other entities, as 
     appropriate) of whether the current voluntary consensus 
     standards and rating systems for high performance buildings 
     are consistent with the current technological state of the 
     art, including relevant results from the research, 
     development and demonstration activities of the Department;
       (2) determine if additional research is required, based on 
     the findings of the assessment; and
       (3) recommend steps for the Secretary to accelerate the 
     development of voluntary consensus-based standards for high 
     performance buildings that are based on the findings of the 
     assessment.
       (c) Grant and Technical Assistance Program.--Consistent 
     with subsection (b) and section 12(d) of the National 
     Technology Transfer and Advancement Act of 1995 (15 U.S.C. 
     272 note), the Secretary shall establish a grant and 
     technical assistance program to support the development of 
     voluntary consensus-based standards for high performance 
     buildings.

     SEC. 915. SECONDARY ELECTRIC VEHICLE BATTERY USE PROGRAM.

       (a) Definitions.--In this section:
       (1) Battery.--The term ``battery'' means an energy storage 
     device that previously has been used to provide motive power 
     in a vehicle powered in whole or in part by electricity.
       (2) Associated equipment.--The term ``associated 
     equipment'' means equipment located where the batteries will 
     be used that is necessary to enable the use of the energy 
     stored in the batteries.
       (b) Program.--
       (1) In general.--The Secretary shall establish and conduct 
     a program of research, development, demonstration, and 
     commercial application of energy technology for the secondary 
     use of batteries, if the Secretary finds that there are 
     sufficient numbers of batteries to support the program.
       (2) Administration.--The program shall be--
       (A) designed to demonstrate the use of batteries in 
     secondary applications, including utility and commercial 
     power storage and power quality;
       (B) structured to evaluate the performance, including 
     useful service life and costs, of such batteries in field 
     operations, and the necessary supporting infrastructure, 
     including reuse and disposal of batteries; and
       (C) coordinated with ongoing secondary battery use programs 
     at the National Laboratories and in industry.

[[Page 17867]]

       (c) Solicitation.--
       (1) In general.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary shall solicit proposals 
     to demonstrate the secondary use of batteries and associated 
     equipment and supporting infrastructure in geographic 
     locations throughout the United States.
       (2) Additional solicitations.--The Secretary may make 
     additional solicitations for proposals if the Secretary 
     determines that the solicitations are necessary to carry out 
     this section.
       (d) Selection of Proposals.--
       (1) In general.--Not later than 90 days after the closing 
     date established by the Secretary for receipt of proposals 
     under subsection (c), the Secretary shall select up to 5 
     proposals that may receive financial assistance under this 
     section once the Department receives appropriated funds to 
     carry out this section.
       (2) Factors.--In selecting proposals, the Secretary shall 
     consider--
       (A) the diversity of battery type;
       (B) geographic and climatic diversity; and
       (C) life-cycle environmental effects of the approaches.
       (3) Limitation.--No 1 project selected under this section 
     shall receive more than 25 percent of the funds made 
     available to carry out the program under this section.
       (4) Non-federal involvement.--In selecting proposals, the 
     Secretary shall consider the extent of involvement of State 
     or local government and other persons in each demonstration 
     project to optimize use of Federal resources.
       (5) Other criteria.--In selecting proposals, the Secretary 
     may consider such other criteria as the Secretary considers 
     appropriate.
       (e) Conditions.--In carrying out this section, the 
     Secretary shall require that--
       (1) relevant information be provided to--
       (A) the Department;
       (B) the users of the batteries;
       (C) the proposers of a project under this section; and
       (D) the battery manufacturers; and
       (2) the costs of carrying out projects and activities under 
     this section are shared in accordance with section 988.

     SEC. 916. ENERGY EFFICIENCY SCIENCE INITIATIVE.

       (a) Establishment.--The Secretary shall establish an Energy 
     Efficiency Science Initiative to be managed by the Assistant 
     Secretary in the Department with responsibility for energy 
     conservation under section 203(a)(9) of the Department of 
     Energy Organization Act (42 U.S.C. 7133(a)(9)), in 
     consultation with the Director of the Office of Science, for 
     grants to be competitively awarded and subject to peer review 
     for research relating to energy efficiency.
       (b) Report.--The Secretary shall submit to Congress, along 
     with the annual budget request of the President submitted to 
     Congress, a report on the activities of the Energy Efficiency 
     Science Initiative, including a description of the process 
     used to award the funds and an explanation of how the 
     research relates to energy efficiency.

     SEC. 917. ADVANCED ENERGY EFFICIENCY TECHNOLOGY TRANSFER 
                   CENTERS.

       (a) Grants.--Not later than 18 months after the date of 
     enactment of this Act, the Secretary shall make grants to 
     nonprofit institutions, State and local governments, or 
     universities (or consortia thereof), to establish a 
     geographically dispersed network of Advanced Energy 
     Efficiency Technology Transfer Centers, to be located in 
     areas the Secretary determines have the greatest need of the 
     services of such Centers. In establishing the network, the 
     Secretary shall consider the special needs and opportunities 
     for increased energy efficiency for manufactured and site-
     built housing.
       (b) Activities.--
       (1) In general.--Each Center shall operate a program to 
     encourage demonstration and commercial application of 
     advanced energy methods and technologies through education 
     and outreach to building and industrial professionals, and to 
     other individuals and organizations with an interest in 
     efficient energy use.
       (2) Advisory panel.--Each Center shall establish an 
     advisory panel to advise the Center on how best to accomplish 
     the activities under paragraph (1).
       (c) Application.--A person seeking a grant under this 
     section shall submit to the Secretary an application in such 
     form and containing such information as the Secretary may 
     require. The Secretary may award a grant under this section 
     to an entity already in existence if the entity is otherwise 
     eligible under this section.
       (d) Selection Criteria.--The Secretary shall award grants 
     under this section on the basis of the following criteria, at 
     a minimum:
       (1) The ability of the applicant to carry out the 
     activities described in subsection (b)(1).
       (2) The extent to which the applicant will coordinate the 
     activities of the Center with other entities, such as State 
     and local governments, utilities, and educational and 
     research institutions.
       (e) Cost-Sharing.--In carrying out this section, the 
     Secretary shall require cost-sharing in accordance with the 
     requirements of section 988 for commercial application 
     activities.
       (f) Advisory Committee.--The Secretary shall establish an 
     advisory committee to advise the Secretary on the 
     establishment of Centers under this section. The advisory 
     committee shall be composed of individuals with expertise in 
     the area of advanced energy methods and technologies, 
     including at least 1 representative from--
       (1) State or local energy offices;
       (2) energy professionals;
       (3) trade or professional associations;
       (4) architects, engineers, or construction professionals;
       (5) manufacturers;
       (6) the research community; and
       (7) nonprofit energy or environmental organizations.
       (g) Definitions.--For purposes of this section:
       (1) Advanced energy methods and technologies.--The term 
     ``advanced energy methods and technologies'' means all 
     methods and technologies that promote energy efficiency and 
     conservation, including distributed generation technologies, 
     and life-cycle analysis of energy use.
       (2) Center.--The term ``Center'' means an Advanced Energy 
     Technology Transfer Center established pursuant to this 
     section.
       (3) Distributed generation.--The term ``distributed 
     generation'' means an electric power generation facility that 
     is designed to serve retail electric consumers at or near the 
     facility site.
       (h) Authorization of Appropriations.--In addition to 
     amounts otherwise authorized to be appropriated in section 
     911, there are authorized to be appropriated for the program 
     under this section such sums as may be appropriated.
       Subtitle B--Distributed Energy and Electric Energy Systems

     SEC. 921. DISTRIBUTED ENERGY AND ELECTRIC ENERGY SYSTEMS.

       (a) In General.--The Secretary shall carry out programs of 
     research, development, demonstration, and commercial 
     application on distributed energy resources and systems 
     reliability and efficiency, to improve the reliability and 
     efficiency of distributed energy resources and systems, 
     integrating advanced energy technologies with grid 
     connectivity, including activities described in this 
     subtitle. The programs shall address advanced energy 
     technologies and systems and advanced grid reliability 
     technologies.
       (b) Authorization of Appropriations.--
       (1) Distributed energy and electric energy systems 
     activities.--There are authorized to be appropriated to the 
     Secretary to carry out distributed energy and electric energy 
     systems activities, including activities authorized under 
     this subtitle--
       (A) $240,000,000 for fiscal year 2007;
       (B) $255,000,000 for fiscal year 2008; and
       (C) $273,000,000 for fiscal year 2009.
       (2) Power delivery research initiative.--There are 
     authorized to be appropriated to the Secretary to carry out 
     the Power Delivery Research Initiative under subsection 
     925(e) such sums as may be necessary for each of fiscal years 
     2007 through 2009.
       (c) Micro-Cogeneration Energy Technology.--From amounts 
     authorized under subsection (b), $20,000,000 for each of 
     fiscal years 2007 and 2008 shall be available to carry out 
     activities under section 923.
       (d) High-voltage Transmission Lines.--From amounts 
     authorized under subsection (b), $2,000,000 for fiscal year 
     2007 shall be available to carry out activities under section 
     925(g).

     SEC. 922. HIGH POWER DENSITY INDUSTRY PROGRAM.

       (a) In General.--The Secretary shall establish a 
     comprehensive research, development, demonstration, and 
     commercial application to improve the energy efficiency of 
     high power density facilities, including data centers, server 
     farms, and telecommunications facilities.
       (b) Technologies.--The program shall consider technologies 
     that provide significant improvement in thermal controls, 
     metering, load management, peak load reduction, or the 
     efficient cooling of electronics.

     SEC. 923. MICRO-COGENERATION ENERGY TECHNOLOGY.

       (a) In General.--The Secretary shall make competitive, 
     merit-based grants to consortia for the development of micro-
     cogeneration energy technology.
       (b) Uses.--The consortia shall explore--
       (1) the use of small-scale combined heat and power in 
     residential heating appliances;
       (2) the use of excess power to operate other appliances 
     within the residence; and
       (3) the supply of excess generated power to the power grid.

     SEC. 924. DISTRIBUTED ENERGY TECHNOLOGY DEMONSTRATION 
                   PROGRAMS.

       (a) Coordinating Consortia Program.--The Secretary may 
     provide financial assistance to coordinating consortia of 
     interdisciplinary participants for demonstrations designed to 
     accelerate the use of distributed energy technologies (such 
     as fuel cells, microturbines, reciprocating engines, 
     thermally activated technologies, and combined heat and power 
     systems) in highly energy intensive commercial applications.
       (b) Small-Scale Portable Power Program.--
       (1) In general.--The Secretary shall--
       (A) establish a research, development, and demonstration 
     program to develop working models of small scale portable 
     power devices; and
       (B) to the fullest extent practicable, identify and utilize 
     the resources of universities that have shown expertise with 
     respect to advanced portable power devices for either 
     civilian or military use.
       (2) Organization.--The universities identified and utilized 
     under paragraph (1)(B) are authorized to establish an 
     organization to promote small scale portable power devices.
       (3) Definition.--For purposes of this subsection, the term 
     ``small scale portable power device'' means a field-
     deployable portable mechanical or electromechanical device 
     that can be used for applications such as communications, 
     computation, mobility enhancement, weapons systems, optical 
     devices, cooling, sensors, medical devices, and active 
     biological agent detection systems.

[[Page 17868]]



     SEC. 925. ELECTRIC TRANSMISSION AND DISTRIBUTION PROGRAMS.

       (a) Program.--The Secretary shall establish a comprehensive 
     research, development, and demonstration program to ensure 
     the reliability, efficiency, and environmental integrity of 
     electrical transmission and distribution systems, which shall 
     include--
       (1) advanced energy delivery technologies, energy storage 
     technologies, materials, and systems, giving priority to new 
     transmission technologies, including composite conductor 
     materials and other technologies that enhance reliability, 
     operational flexibility, or power-carrying capability;
       (2) advanced grid reliability and efficiency technology 
     development;
       (3) technologies contributing to significant load 
     reductions;
       (4) advanced metering, load management, and control 
     technologies;
       (5) technologies to enhance existing grid components;
       (6) the development and use of high-temperature 
     superconductors to--
       (A) enhance the reliability, operational flexibility, or 
     power-carrying capability of electric transmission or 
     distribution systems; or
       (B) increase the efficiency of electric energy generation, 
     transmission, distribution, or storage systems;
       (7) integration of power systems, including systems to 
     deliver high-quality electric power, electric power 
     reliability, and combined heat and power;
       (8) supply of electricity to the power grid by small scale, 
     distributed and residential-based power generators;
       (9) the development and use of advanced grid design, 
     operation, and planning tools;
       (10) any other infrastructure technologies, as appropriate; 
     and
       (11) technology transfer and education.
       (b) Program Plan.--
       (1) In general.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary, in consultation with 
     other appropriate Federal agencies, shall prepare and submit 
     to Congress a 5-year program plan to guide activities under 
     this section.
       (2) Consultation.--In preparing the program plan, the 
     Secretary shall consult with--
       (A) utilities;
       (B) energy service providers;
       (C) manufacturers;
       (D) institutions of higher education;
       (E) other appropriate State and local agencies;
       (F) environmental organizations;
       (G) professional and technical societies; and
       (H) any other persons the Secretary considers appropriate.
       (c) Implementation.--The Secretary shall consider 
     implementing the program under this section using a 
     consortium of participants from industry, institutions of 
     higher education, and National Laboratories.
       (d) Report.--Not later than 2 years after the submission of 
     the plan under subsection (b), the Secretary shall submit to 
     Congress a report--
       (1) describing the progress made under this section; and
       (2) identifying any additional resources needed to continue 
     the development and commercial application of transmission 
     and distribution of infrastructure technologies.
       (e) Power Delivery Research Initiative.--
       (1) In general.--The Secretary shall establish a research, 
     development, and demonstration initiative specifically 
     focused on power delivery using components incorporating high 
     temperature superconductivity.
       (2) Goals.--The goals of the Initiative shall be--
       (A) to establish world-class facilities to develop high 
     temperature superconductivity power applications in 
     partnership with manufacturers and utilities;
       (B) to provide technical leadership for establishing 
     reliability for high temperature superconductivity power 
     applications, including suitable modeling and analysis;
       (C) to facilitate the commercial transition toward direct 
     current power transmission, storage, and use for high power 
     systems using high temperature superconductivity; and
       (D) to facilitate the integration of very low impedance 
     high temperature superconducting wires and cables in existing 
     electric networks to improve system performance, power flow 
     control, and reliability.
       (3) Inclusions.--The Initiative shall include--
       (A) feasibility analysis, planning, research, and design to 
     construct demonstrations of superconducting links in high 
     power, direct current, and controllable alternating current 
     transmission systems;
       (B) public-private partnerships to demonstrate deployment 
     of high temperature superconducting cable into testbeds 
     simulating a realistic transmission grid and under varying 
     transmission conditions, including actual grid insertions; 
     and
       (C) testbeds developed in cooperation with National 
     Laboratories, industries, and institutions of higher 
     education to--
       (i) demonstrate those technologies;
       (ii) prepare the technologies for commercial introduction; 
     and
       (iii) address cost or performance roadblocks to successful 
     commercial use.
       (f) Transmission and Distribution Grid Planning and 
     Operations Initiative.--
       (1) In general.--The Secretary shall establish a research, 
     development, and demonstration initiative specifically 
     focused on tools needed to plan, operate, and expand the 
     transmission and distribution grids in the presence of 
     competitive market mechanisms for energy, load demand, 
     customer response, and ancillary services.
       (2) Goals.--The goals of the Initiative shall be--
       (A)(i) to develop and use a geographically distributed 
     center, consisting of institutions of higher education, and 
     National Laboratories, with expertise and facilities to 
     develop the underlying theory and software for power system 
     application; and
       (ii) to ensure commercial development in partnership with 
     software vendors and utilities;
       (B) to provide technical leadership in engineering and 
     economic analysis for the reliability and efficiency of power 
     systems planning and operations in the presence of 
     competitive markets for electricity;
       (C) to model, simulate, and experiment with new market 
     mechanisms and operating practices to understand and optimize 
     those new methods before actual use; and
       (D) to provide technical support and technology transfer to 
     electric utilities and other participants in the domestic 
     electric industry and marketplace.
       (g) High-voltage Transmission Lines.--As part of the 
     program described in subsection (a), the Secretary shall 
     award a grant to a university research program to design and 
     test, in consultation with the Tennessee Valley Authority, 
     state-of-the-art optimization techniques for power flow 
     through existing high voltage transmission lines.
                      Subtitle C--Renewable Energy

     SEC. 931. RENEWABLE ENERGY.

       (a) In General.--
       (1) Objectives.--The Secretary shall conduct programs of 
     renewable energy research, development, demonstration, and 
     commercial application, including activities described in 
     this subtitle. Such programs shall take into consideration 
     the following objectives:
       (A) Increasing the conversion efficiency of all forms of 
     renewable energy through improved technologies.
       (B) Decreasing the cost of renewable energy generation and 
     delivery.
       (C) Promoting the diversity of the energy supply.
       (D) Decreasing the dependence of the United States on 
     foreign energy supplies.
       (E) Improving United States energy security.
       (F) Decreasing the environmental impact of energy-related 
     activities.
       (G) Increasing the export of renewable generation equipment 
     from the United States.
       (2) Programs.--
       (A) Solar energy.--The Secretary shall conduct a program of 
     research, development, demonstration, and commercial 
     application for solar energy, including--
       (i) photovoltaics;
       (ii) solar hot water and solar space heating;
       (iii) concentrating solar power;
       (iv) lighting systems that integrate sunlight and 
     electrical lighting in complement to each other in common 
     lighting fixtures for the purpose of improving energy 
     efficiency;
       (v) manufacturability of low cost high, quality solar 
     systems; and
       (vi) development of products that can be easily integrated 
     into new and existing buildings.
       (B) Wind energy.--The Secretary shall conduct a program of 
     research, development, demonstration, and commercial 
     application for wind energy, including--
       (i) low speed wind energy;
       (ii) offshore wind energy;
       (iii) testing and verification (including construction and 
     operation of a research and testing facility capable of 
     testing wind turbines); and
       (iv) distributed wind energy generation.
       (C) Geothermal.--The Secretary shall conduct a program of 
     research, development, demonstration, and commercial 
     application for geothermal energy. The program shall focus on 
     developing improved technologies for reducing the costs of 
     geothermal energy installations, including technologies for--
       (i) improving detection of geothermal resources;
       (ii) decreasing drilling costs;
       (iii) decreasing maintenance costs through improved 
     materials;
       (iv) increasing the potential for other revenue sources, 
     such as mineral production; and
       (v) increasing the understanding of reservoir life cycle 
     and management.
       (D) Hydropower.--The Secretary shall conduct a program of 
     research, development, demonstration, and commercial 
     application for cost competitive technologies that enable the 
     development of new and incremental hydropower capacity, 
     adding to the diversity of the energy supply of the United 
     States, including:
       (i) Fish-friendly large turbines.
       (ii) Advanced technologies to enhance environmental 
     performance and yield greater energy efficiencies.
       (E) Miscellaneous projects.--The Secretary shall conduct 
     research, development, demonstration, and commercial 
     application programs for--
       (i) ocean energy, including wave energy;
       (ii) the combined use of renewable energy technologies with 
     one another and with other energy technologies, including the 
     combined use of wind power and coal gasification 
     technologies;
       (iii) renewable energy technologies for cogeneration of 
     hydrogen and electricity; and
       (iv) kinetic hydro turbines.
       (b) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary to carry out renewable 
     energy research, development, demonstration, and commercial 
     application activities, including activities authorized under 
     this subtitle--

[[Page 17869]]

       (1) $632,000,000 for fiscal year 2007;
       (2) $743,000,000 for fiscal year 2008; and
       (3) $852,000,000 for fiscal year 2009.
       (c) Bioenergy.--From the amounts authorized under 
     subsection (b), there are authorized to be appropriated to 
     carry out section 932--
       (1) $213,000,000 for fiscal year 2007, of which 
     $100,000,000 shall be for section 932 (d);
       (2) $251,000,000 for fiscal year 2008, of which 
     $125,000,000 shall be for section 932 (d); and
       (3) $274,000,000 for fiscal year 2009, of which 
     $150,000,000 shall be for section 932 (d) .
       (d) Solar Power.--From amounts authorized under subsection 
     (b), there is authorized to be appropriated to carry out 
     activities under subsection (a)(2)(A)--
       (1) $140,000,000 for fiscal year 2007, of which $40,000,000 
     shall be for activities under section 935;
       (2) $200,000,000 for fiscal year 2008, of which $50,000,000 
     shall be for activities under section 935; and
       (3) $250,000,000 for fiscal year 2009, of which $50,000,000 
     shall be for activities under section 935.
       (e) Administration.--Of the funds authorized under 
     subsection (c), not less than $5,000,000 for each fiscal year 
     shall be made available for grants to--
       (1) part B institutions;
       (2) Tribal Colleges or Universities (as defined in section 
     316(b) of the Higher Education Act of 1965 (20 U.S.C. 
     1059c(b))); and
       (3) Hispanic-serving institutions.
       (f) Rural Demonstration Projects.--In carrying out this 
     section, the Secretary, in consultation with the Secretary of 
     Agriculture, shall demonstrate the use of renewable energy 
     technologies to assist in delivering electricity to rural and 
     remote locations including --
       (1) advanced wind power technology, including combined use 
     with coal gasification;
       (2) biomass; and
       (3) geothermal energy systems.
       (g) Analysis and Evaluation.--
       (1) In general.--The Secretary shall conduct analysis and 
     evaluation in support of the renewable energy programs under 
     this subtitle. These activities shall be used to guide budget 
     and program decisions, and shall include--
       (A) economic and technical analysis of renewable energy 
     potential, including resource assessment;
       (B) analysis of past program performance, both in terms of 
     technical advances and in market introduction of renewable 
     energy; and
       (C) any other analysis or evaluation that the Secretary 
     considers appropriate.
       (2) Funding.--The Secretary may designate up to 1 percent 
     of the funds appropriated for carrying out this subtitle for 
     analysis and evaluation activities under this subsection.

     SEC. 932. BIOENERGY PROGRAM.

       (a) Definitions.--In this section:
       (1) Biomass.--The term ``biomass'' means--
       (A) any organic material grown for the purpose of being 
     converted to energy;
       (B) any organic byproduct of agriculture (including wastes 
     from food production and processing) that can be converted 
     into energy; or
       (C) any waste material that can be converted to energy, is 
     segregated from other waste materials, and is derived from-
       (i) any of the following forest-related resources: mill 
     residues, precommercial thinnings, slash, brush, or otherwise 
     nonmerchantable material; or
       (ii) wood waste materials, including waste pallets, crates, 
     dunnage, manufacturing and construction wood wastes (other 
     than pressure-treated, chemically-treated, or painted wood 
     wastes), and landscape or right-of-way tree trimmings, but 
     not including municipal solid waste, gas derived from the 
     biodegradation of municipal solid waste, or paper that is 
     commonly recycled.
       (2)  Lignocellulosic feedstock.--The term ``lignocellulosic 
     feedstock'' means any portion of a plant or coproduct from 
     conversion, including crops, trees, forest residues, and 
     agricultural residues not specifically grown for food, 
     including from barley grain, grapeseed, rice bran, rice 
     hulls, rice straw, soybean matter, and sugarcane bagasse.
       (b) Program.--The Secretary shall conduct a program of 
     research, development, demonstration, and commercial 
     application for bioenergy, including--
       (1) biopower energy systems;
       (2) biofuels;
       (3) bioproducts;
       (4) integrated biorefineries that may produce biopower, 
     biofuels, and bioproducts;
       (5) cross-cutting research and development in feedstocks; 
     and
       (6) economic analysis.
       (c) Biofuels and Bioproducts.--The goals of the biofuels 
     and bioproducts programs shall be to develop, in partnership 
     with industry and institutions of higher education--
       (1) advanced biochemical and thermochemical conversion 
     technologies capable of making fuels from lignocellulosic 
     feedstocks that are price-competitive with gasoline or diesel 
     in either internal combustion engines or fuel cell-powered 
     vehicles;
       (2) advanced biotechnology processes capable of making 
     biofuels and bioproducts with emphasis on development of 
     biorefinery technologies using enzyme-based processing 
     systems;
       (3) advanced biotechnology processes capable of increasing 
     energy production from lignocellulosic feedstocks, with 
     emphasis on reducing the dependence of industry on fossil 
     fuels in manufacturing facilities; and
       (4) other advanced processes that will enable the 
     development of cost-effective bioproducts, including 
     biofuels.
       (d) Integrated Biorefinery Demonstration Projects.--
       (1) In general.--The Secretary shall carry out a program to 
     demonstrate the commercial application of integrated 
     biorefineries. The Secretary shall ensure geographical 
     distribution of biorefinery demonstrations under this 
     subsection. The Secretary shall not provide more than 
     $100,000,000 under this subsection for any single biorefinery 
     demonstration. In making awards under this subsection, the 
     Secretary shall encourage--
       (A) the demonstration of a wide variety of lignocellulosic 
     feedstocks;
       (B) the commercial application of biomass technologies for 
     a variety of uses, including--
       (i) liquid transportation fuels;
       (ii) high-value biobased chemicals;
       (iii) substitutes for petroleum-based feedstocks and 
     products; and
       (iv) energy in the form of electricity or useful heat; and
       (C) the demonstration of the collection and treatment of a 
     variety of biomass feedstocks.
       (2) Proposals.--Not later than 6 months after the date of 
     enactment of this Act, the Secretary shall solicit proposals 
     for demonstration of advanced biorefineries. The Secretary 
     shall select only proposals that--
       (A) demonstrate that the project will be able to operate 
     profitably without direct Federal subsidy after initial 
     construction costs are paid; and
       (B) enable the biorefinery to be easily replicated.
       (e) University Biodiesel Program.--The Secretary shall 
     establish a demonstration program to determine the 
     feasibility of the operation of diesel electric power 
     generators, using biodiesel fuels with ratings as high as 
     B100, at electric generation facilities owned by institutions 
     of higher education. The program shall examine--
       (1) heat rates of diesel fuels with large quantities of 
     cellulosic content;
       (2) the reliability of operation of various fuel blends;
       (3) performance in cold or freezing weather;
       (4) stability of fuel after extended storage; and
       (5) other criteria, as determined by the Secretary.

     SEC. 933. LOW-COST RENEWABLE HYDROGEN AND INFRASTRUCTURE FOR 
                   VEHICLE PROPULSION.

       The Secretary shall--
       (1) establish a research, development, and demonstration 
     program to determine the feasibility of using hydrogen 
     propulsion in light-weight vehicles and the integration of 
     the associated hydrogen production infrastructure using off-
     the-shelf components; and
       (2) identify universities and institutions that--
       (A) have expertise in researching and testing vehicles 
     fueled by hydrogen, methane, and other fuels;
       (B) have expertise in integrating off-the-shelf components 
     to minimize cost; and
       (C) within 2 years can test a vehicle based on an existing 
     commercially available platform with a curb weight of not 
     less than 2,000 pounds before modifications, that--
       (i) operates solely on hydrogen;
       (ii) qualifies as a light-duty passenger vehicle; and
       (iii) uses hydrogen produced from water using only solar 
     energy.

     SEC. 934. CONCENTRATING SOLAR POWER RESEARCH PROGRAM.

       (a) In General.--The Secretary shall conduct a program of 
     research and development to evaluate the potential for 
     concentrating solar power for hydrogen production, including 
     cogeneration approaches for both hydrogen and electricity.
       (b) Administration.--The program shall take advantage of 
     existing facilities to the extent practicable and shall 
     include--
       (1) development of optimized technologies that are common 
     to both electricity and hydrogen production;
       (2) evaluation of thermochemical cycles for hydrogen 
     production at the temperatures attainable with concentrating 
     solar power;
       (3) evaluation of materials issues for the thermochemical 
     cycles described in paragraph (2);
       (4) cogeneration of solar thermal electric power and photo-
     synthetic-based hydrogen production;
       (5) system architectures and economics studies; and
       (6) coordination with activities under the Next Generation 
     Nuclear Plant Project established under subtitle C of title 
     VI on high temperature materials, thermochemical cycles, and 
     economic issues.
       (c) Assessment.--In carrying out the program under this 
     section, the Secretary shall--
       (1) assess conflicting guidance on the economic potential 
     of concentrating solar power for electricity production 
     received from the National Research Council in the report 
     entitled ``Renewable Power Pathways: A Review of the U.S. 
     Department of Energy's Renewable Energy Programs'' and dated 
     2000 and subsequent reviews of that report funded by the 
     Department; and
       (2) provide an assessment of the potential impact of 
     technology used to concentrate solar power for electricity 
     before, or concurrent with, submission of the budget for 
     fiscal year 2008.
       (d) Report.--Not later than 5 years after the date of 
     enactment of this Act, the Secretary shall provide to 
     Congress a report on the economic and technical potential for 
     electricity or

[[Page 17870]]

     hydrogen production, with or without cogeneration, with 
     concentrating solar power, including the economic and 
     technical feasibility of potential construction of a pilot 
     demonstration facility suitable for commercial production of 
     electricity or hydrogen from concentrating solar power.

     SEC. 935. RENEWABLE ENERGY IN PUBLIC BUILDINGS.

       (a) Demonstration and Technology Transfer Program.--The 
     Secretary shall establish a program for the demonstration of 
     innovative technologies for solar and other renewable energy 
     sources in buildings owned or operated by a State or local 
     government, and for the dissemination of information 
     resulting from such demonstration to interested parties.
       (b) Limit on Federal Funding.--Notwithstanding section 988, 
     the Secretary shall provide under this section no more than 
     40 percent of the incremental costs of the solar or other 
     renewable energy source project funded.
       (c) Requirements.--As part of the application for awards 
     under this section, the Secretary shall require all 
     applicants---
       (1) to demonstrate a continuing commitment to the use of 
     solar and other renewable energy sources in buildings they 
     own or operate; and
       (2) to state how they expect any award to further their 
     transition to the significant use of renewable energy.
   Subtitle D--Agricultural Biomass Research and Development Programs

     SEC. 941. AMENDMENTS TO THE BIOMASS RESEARCH AND DEVELOPMENT 
                   ACT OF 2000.

       (a) Definitions.--Section 303 of the Biomass Research and 
     Development Act of 2000 (Public Law 106-224; 7 U.S.C. 8101 
     note) is amended--
       (1) by striking paragraphs (2), (9), and (10);
       (2) by redesignating paragraphs (3), (4), (5), (6), (7), 
     and (8) as paragraphs (4), (5), (7), (8), (9), and (10), 
     respectively;
       (3) by inserting after paragraph (1) the following:
       ``(2) Biobased fuel.--The term `biobased fuel' means any 
     transportation fuel produced from biomass.
       ``(3) Biobased product.--The term `biobased product' means 
     an industrial product (including chemicals, materials, and 
     polymers) produced from biomass, or a commercial or 
     industrial product (including animal feed and electric power) 
     derived in connection with the conversion of biomass to 
     fuel.'';
       (4) by inserting after paragraph (5) (as redesignated by 
     paragraph (2)) the following:
       ``(6) Demonstration.--The term `demonstration' means 
     demonstration of technology in a pilot plant or semi-works 
     scale facility.''; and
       (5) by striking paragraph (9) (as redesignated by paragraph 
     (2)) and inserting the following:
       ``(9) National laboratory.--The term `National Laboratory' 
     has the meaning given that term in section 2 of the Energy 
     Policy Act of 2005.''
       (b) Cooperation and Coordination in Biomass Research and 
     Development.--Section 304 of the Biomass Research and 
     Development Act of 2000 (Public Law 106-224; 7 U.S.C. 8101 
     note) is amended--
       (1) in subsections (a) and (d), by striking ``industrial 
     products'' each place it appears and inserting ``fuels and 
     biobased products'';
       (2) by striking subsections (b) and (c); and
       (3) by redesignating subsection (d) as subsection (b).
       (c) Biomass Research and Development Board.--Section 305 of 
     the Biomass Research and Development Act of 2000 (Public Law 
     106-224; 7 U.S.C. 8101 note) is amended--
       (1) in subsections (a) and (c), by striking ``industrial 
     products'' each place it appears and inserting ``fuels and 
     biobased products'';
       (2) in subsection (b)--
       (A) in paragraph (1), by striking ``304(d)(1)(B)'' and 
     inserting ``304(b)(1)(B)''; and
       (B) in paragraph (2), by striking ``304(d)(1)(A)'' and 
     inserting ``304(b)(1)(A)''; and
       (3) in subsection (c)--
       (A) in paragraph (1)(B), by striking ``and'' at the end;
       (B) in paragraph (2), by striking the period at the end and 
     inserting a semicolon; and
       (C) by adding at the end the following:
       ``(3) ensure that--
       ``(A) solicitations are open and competitive with awards 
     made annually; and
       ``(B) objectives and evaluation criteria of the 
     solicitations are clearly stated and minimally prescriptive, 
     with no areas of special interest; and
       ``(4) ensure that the panel of scientific and technical 
     peers assembled under section 307(g)(1)(C) to review 
     proposals is composed predominantly of independent experts 
     selected from outside the Departments of Agriculture and 
     Energy.''.
       (d) Biomass Research and Development Technical Advisory 
     Committee.--Section 306 of the Biomass Research and 
     Development Act of 2000 (Public Law 106-224; 7 U.S.C. 8101 
     note) is amended--
       (1) in subsection (b)(1)--
       (A) in subparagraph (A), by striking ``biobased industrial 
     products'' and inserting ``biofuels'';
       (B) by redesignating subparagraphs (B) through (J) as 
     subparagraphs (C) through (K), respectively;
       (C) by inserting after subparagraph (A) the following:
       ``(B) an individual affiliated with the biobased industrial 
     and commercial products industry;'';
       (D) in subparagraph (F) (as redesignated by subparagraph 
     (B)) by striking ``an individual has'' and inserting ``2 
     individuals have'';
       (E) in subparagraphs (C), (D), (G), and (I) (as 
     redesignated by subparagraph (B)) by striking ``industrial 
     products'' each place it appears and inserting ``fuels and 
     biobased products''; and
       (F) in subparagraph (H) (as redesignated by subparagraph 
     (B)), by inserting ``and environmental'' before ``analysis'';
       (2) in subsection (c)(2)--
       (A) in subparagraph (A), by striking ``goals'' and 
     inserting ``objectives, purposes, and considerations'';
       (B) by redesignating subparagraphs (B) and (C) as 
     subparagraphs (C) and (D), respectively;
       (C) by inserting after subparagraph (A) the following:
       ``(B) solicitations are open and competitive with awards 
     made annually and that objectives and evaluation criteria of 
     the solicitations are clearly stated and minimally 
     prescriptive, with no areas of special interest;''; and
       (D) in subparagraph (C) (as redesignated by subparagraph 
     (B)) by inserting ``predominantly from outside the 
     Departments of Agriculture and Energy'' after ``technical 
     peers''.
       (e) Biomass Research and Development Initiative.--Section 
     307 of the Biomass Research and Development Act of 2000 
     (Public Law 106-224; 7 U.S.C. 8101 note) is amended--
       (1) in subsection (a), by striking ``research on biobased 
     industrial products'' and inserting ``research on, and 
     development and demonstration of, biobased fuels and biobased 
     products, and the methods, practices and technologies, for 
     their production''; and
       (2) by striking subsections (b) through (e) and inserting 
     the following:
       ``(b) Objectives.--The objectives of the Initiative are to 
     develop--
       ``(1) technologies and processes necessary for abundant 
     commercial production of biobased fuels at prices competitive 
     with fossil fuels;
       ``(2) high-value biobased products--
       ``(A) to enhance the economic viability of biobased fuels 
     and power; and
       ``(B) as substitutes for petroleum-based feedstocks and 
     products; and
       ``(3) a diversity of sustainable domestic sources of 
     biomass for conversion to biobased fuels and biobased 
     products.
       ``(c) Purposes.--The purposes of the Initiative are--
       ``(1) to increase the energy security of the United States;
       ``(2) to create jobs and enhance the economic development 
     of the rural economy;
       ``(3) to enhance the environment and public health; and
       ``(4) to diversify markets for raw agricultural and 
     forestry products.
       ``(d) Technical Areas.--To advance the objectives and 
     purposes of the Initiative, the Secretary of Agriculture and 
     the Secretary of Energy, in consultation with the 
     Administrator of the Environmental Protection Agency and 
     heads of other appropriate departments and agencies (referred 
     to in this section as the `Secretaries'), shall direct 
     research and development toward--
       ``(1) feedstock production through the development of crops 
     and cropping systems relevant to production of raw materials 
     for conversion to biobased fuels and biobased products, 
     including--
       ``(A) development of advanced and dedicated crops with 
     desired features, including enhanced productivity, broader 
     site range, low requirements for chemical inputs, and 
     enhanced processing;
       ``(B) advanced crop production methods to achieve the 
     features described in subparagraph (A);
       ``(C) feedstock harvest, handling, transport, and storage; 
     and
       ``(D) strategies for integrating feedstock production into 
     existing managed land;
       ``(2) overcoming recalcitrance of cellulosic biomass 
     through developing technologies for converting cellulosic 
     biomass into intermediates that can subsequently be converted 
     into biobased fuels and biobased products, including--
       ``(A) pretreatment in combination with enzymatic or 
     microbial hydrolysis; and
       ``(B) thermochemical approaches, including gasification and 
     pyrolysis;
       ``(3) product diversification through technologies relevant 
     to production of a range of biobased products (including 
     chemicals, animal feeds, and cogenerated power) that 
     eventually can increase the feasibility of fuel production in 
     a biorefinery, including--
       ``(A) catalytic processing, including thermochemical fuel 
     production;
       ``(B) metabolic engineering, enzyme engineering, and 
     fermentation systems for biological production of desired 
     products or cogeneration of power;
       ``(C) product recovery;
       ``(D) power production technologies; and
       ``(E) integration into existing biomass processing 
     facilities, including starch ethanol plants, paper mills, and 
     power plants; and
       ``(4) analysis that provides strategic guidance for the 
     application of biomass technologies in accordance with 
     realization of improved sustainability and environmental 
     quality, cost effectiveness, security, and rural economic 
     development, usually featuring system-wide approaches.
       ``(e) Additional Considerations.--Within the technical 
     areas described in subsection (d), and in addition to 
     advancing the purposes described in subsection (c) and the 
     objectives described in subsection (b), the Secretaries shall 
     support research and development--
       ``(1) to create continuously expanding opportunities for 
     participants in existing biofuels production by seeking 
     synergies and continuity

[[Page 17871]]

     with current technologies and practices, such as the use of 
     dried distillers grains as a bridge feedstock;
       ``(2) to maximize the environmental, economic, and social 
     benefits of production of biobased fuels and biobased 
     products on a large scale through life-cycle economic and 
     environmental analysis and other means; and
       ``(3) to assess the potential of Federal land and land 
     management programs as feedstock resources for biobased fuels 
     and biobased products, consistent with the integrity of soil 
     and water resources and with other environmental 
     considerations.
       ``(f) Eligible Entities.--To be eligible for a grant, 
     contract, or assistance under this section, an applicant 
     shall be--
       ``(1) an institution of higher education;
       ``(2) a National Laboratory;
       ``(3) a Federal research agency;
       ``(4) a State research agency;
       ``(5) a private sector entity;
       ``(6) a nonprofit organization; or
       ``(7) a consortium of 2 of more entities described in 
     paragraphs (1) through (6).
       ``(g) Administration.--
       ``(1) In general.--After consultation with the Board, the 
     points of contact shall--
       ``(A) publish annually 1 or more joint requests for 
     proposals for grants, contracts, and assistance under this 
     section;
       ``(B) require that grants, contracts, and assistance under 
     this section be awarded competitively, on the basis of merit, 
     after the establishment of procedures that provide for 
     scientific peer review by an independent panel of scientific 
     and technical peers; and
       ``(C) give some preference to applications that--
       ``(i) involve a consortia of experts from multiple 
     institutions;
       ``(ii) encourage the integration of disciplines and 
     application of the best technical resources; and
       ``(iii) increase the geographic diversity of demonstration 
     projects.
       ``(2) Distribution of funding by technical area.--Of the 
     funds authorized to be appropriated for activities described 
     in this section, funds shall be distributed for each of 
     fiscal years 2007 through 2010 so as to achieve an 
     approximate distribution of--
       ``(A) 20 percent of the funds to carry out activities for 
     feedstock production under subsection (d)(1);
       ``(B) 45 percent of the funds to carry out activities for 
     overcoming recalcitrance of cellulosic biomass under 
     subsection (d)(2);
       ``(C) 30 percent of the funds to carry out activities for 
     product diversification under subsection (d)(3); and
       ``(D) 5 percent of the funds to carry out activities for 
     strategic guidance under subsection (d)(4).
       ``(3) Distribution of funding within each technical area.--
     Within each technical area described in paragraphs (1) 
     through (3) of subsection (d), funds shall be distributed for 
     each of fiscal years 2007 through 2010 so as to achieve an 
     approximate distribution of--
       ``(A) 15 percent of the funds for applied fundamentals;
       ``(B) 35 percent of the funds for innovation; and
       ``(C) 50 percent of the funds for demonstration.
       ``(4) Matching funds.--
       ``(A) In general.--A minimum 20 percent funding match shall 
     be required for demonstration projects under this title.
       ``(B) Commercial applications.--A minimum of 50 percent 
     funding match shall be required for commercial application 
     projects under this title.
       ``(5) Technology and information transfer to agricultural 
     users.--The Administrator of the Cooperative State Research, 
     Education, and Extension Service and the Chief of the Natural 
     Resources Conservation Service shall ensure that applicable 
     research results and technologies from the Initiative are 
     adapted, made available, and disseminated through those 
     services, as appropriate.''.
       (f) Annual Reports.--Section 309 of the Biomass Research 
     and Development Act of 2000 (Public Law 106-224; 7 U.S.C. 
     8101 note) is amended--
       (1) in subsection (b)--
       (A) in paragraph (1)--
       (i) in subparagraph (A), by striking ``purposes described 
     in section 307(b)'' and inserting ``objectives, purposes, and 
     additional considerations described in subsections (b) 
     through (e) of section 307'';
       (ii) in subparagraph (B), by striking ``and'' at the end;
       (iii) by redesignating subparagraph (C) as subparagraph 
     (D); and
       (iv) by inserting after subparagraph (B) the following:
       ``(C) achieves the distribution of funds described in 
     paragraphs (2) and (3) of section 307(g); and''; and
       (B) in paragraph (2), by striking ``industrial products'' 
     and inserting ``fuels and biobased products''; and
       (2) by adding at the end the following:
       ``(c) Updates.--The Secretary and the Secretary of Energy 
     shall update the Vision and Roadmap documents prepared for 
     Federal biomass research and development activities.''.
       (g) Authorization of Appropriations.--Section 310(b) of the 
     Biomass Research and Development Act of 2000 (Public Law 106-
     224; 7 U.S.C. 8101 note) is amended by striking ``title 
     $54,000,000 for each of fiscal years 2002 through 2007'' and 
     inserting ``title $200,000,000 for each of fiscal years 2006 
     through 2015''.
       (h) Repeal of Sunset Provision.--Section 311 of the Biomass 
     Research and Development Act of 2000 (Public Law 106-224; 7 
     U.S.C. 8101 note) is repealed.

     SEC. 942. PRODUCTION INCENTIVES FOR CELLULOSIC BIOFUELS.

       (a) Purpose.--The purpose of this section is to--
       (1) accelerate deployment and commercialization of 
     biofuels;
       (2) deliver the first 1,000,000,000 gallons in annual 
     cellulosic biofuels production by 2015;
       (3) ensure biofuels produced after 2015 are cost 
     competitive with gasoline and diesel; and
       (4) ensure that small feedstock producers and rural small 
     businesses are full participants in the development of the 
     cellulosic biofuels industry.
       (b) Definitions.--In this section:
       (1) Cellulosic biofuels.--The term ``cellulosic biofuels'' 
     means any fuel that is produced from cellulosic feedstocks.
       (2) Eligible entity.--The term ``eligible entity'' means a 
     producer of fuel from cellulosic biofuels the production 
     facility of which--
       (A) is located in the United States;
       (B) meets all applicable Federal and State permitting 
     requirements; and
       (C) meets any financial criteria established by the 
     Secretary.
       (c) Program.--
       (1) Establishment.--The Secretary, in consultation with the 
     Secretary of Agriculture, the Secretary of Defense, and the 
     Administrator of the Environmental Protection Agency, shall 
     establish an incentive program for the production of 
     cellulosic biofuels.
       (2) Basis of incentives.--Under the program, the Secretary 
     shall award production incentives on a per gallon basis of 
     cellulosic biofuels from eligible entities, through--
       (A) set payments per gallon of cellulosic biofuels produced 
     in an amount determined by the Secretary, until initiation of 
     the first reverse auction; and
       (B) reverse auction thereafter.
       (3) First reverse auction.--The first reverse auction shall 
     be held on the earlier of--
       (A) not later than 1 year after the first year of annual 
     production in the United States of 100,000,000 gallons of 
     cellulosic biofuels, as determined by the Secretary; or
       (B) not later than 3 years after the date of enactment of 
     this Act.
       (4) Reverse auction procedure.--
       (A) In general.--On initiation of the first reverse 
     auction, and each year thereafter until the earlier of the 
     first year of annual production in the United States of 
     1,000,000,000 gallons of cellulosic biofuels, as determined 
     by the Secretary, or 10 years after the date of enactment of 
     this Act, the Secretary shall conduct a reverse auction at 
     which--
       (i) the Secretary shall solicit bids from eligible 
     entities;
       (ii) eligible entities shall submit--

       (I) a desired level of production incentive on a per gallon 
     basis; and
       (II) an estimated annual production amount in gallons; and

       (iii) the Secretary shall issue awards for the production 
     amount submitted, beginning with the eligible entity 
     submitting the bid for the lowest level of production 
     incentive on a per gallon basis and meeting such other 
     criteria as are established by the Secretary, until the 
     amount of funds available for the reverse auction is 
     committed.
       (B) Amount of incentive received.--An eligible entity 
     selected by the Secretary through a reverse auction shall 
     receive the amount of performance incentive requested in the 
     auction for each gallon produced and sold by the entity 
     during the first 6 years of operation.
       (C) Commencement of production of cellulosic biofuels.--As 
     a condition of the receipt of an award under this section, an 
     eligible entity shall enter into an agreement with the 
     Secretary under which the eligible entity agrees to begin 
     production of cellulosic biofuels not later than 3 years 
     after the date of the reverse auction in which the eligible 
     entity participates.
       (d) Limitations.--Awards under this section shall be 
     limited to--
       (1) a per gallon amount determined by the Secretary during 
     the first 4 years of the program;
       (2) a declining per gallon cap over the remaining lifetime 
     of the program, to be established by the Secretary so that 
     cellulosic biofuels produced after the first year of annual 
     cellulosic biofuels production in the United States in excess 
     of 1,000,000,000 gallons are cost competitive with gasoline 
     and diesel;
       (3) not more than 25 percent of the funds committed within 
     each reverse auction to any 1 project;
       (4) not more than $100,000,000 in any 1 year; and
       (5) not more than $1,000,000,000 over the lifetime of the 
     program.
       (e) Priority.--In selecting a project under the program, 
     the Secretary shall give priority to projects that--
       (1) demonstrate outstanding potential for local and 
     regional economic development;
       (2) include agricultural producers or cooperatives of 
     agricultural producers as equity partners in the ventures; 
     and
       (3) have a strategic agreement in place to fairly reward 
     feedstock suppliers.
       (f) Authorizations of Appropriations.--There is authorized 
     to be appropriated to carry out this section $250,000,000.

     SEC. 943. PROCUREMENT OF BIOBASED PRODUCTS.

       (a) Federal Procurement.--

[[Page 17872]]

       (1) Definition of procuring agency.--Section 9001 of the 
     Farm Security and Rural Investment Act of 2002 (7 U.S.C. 
     8101) is amended--
       (A) by redesignating paragraphs (4), (5), and (6) as 
     paragraphs (5), (6), and (7), respectively; and
       (B) by inserting after paragraph (3) the following:
       ``(4) Procuring agency.--The term `procuring agency' 
     means--
       ``(A) any Federal agency that is using Federal funds for 
     procurement; or
       ``(B) any person contracting with any Federal agency with 
     respect to work performed under the contract.''.
       (2) Procurement.--Section 9002 of the Farm Security and 
     Rural Investment Act of 2002 (7 U.S.C. 8102) is amended--
       (A) by striking ``Federal agency'' each place it appears 
     (other than in subsections (f) and (g)) and inserting 
     ``procuring agency'';
       (B) in subsection (c)(2)--
       (i) by striking ``(2)'' and all that follows through 
     ``Notwithstanding'' and inserting the following:
       ``(2) Flexibility.--Notwithstanding'';
       (ii) by striking ``an agency'' and inserting ``a procuring 
     agency''; and
       (iii) by striking ``the agency'' and inserting ``the 
     procuring agency'';
       (C) in subsection (d), by striking ``procured by Federal 
     agencies'' and inserting ``procured by procuring agencies''; 
     and
       (D) in subsection (f), by striking ``Federal agencies'' and 
     inserting ``procuring agencies'' .
       (b) Capitol Complex Procurement.--Section 9002 of the Farm 
     Security and Rural Investment Act of 2002 (7 U.S.C. 8102) (as 
     amended by subsection (a)(2)) is amended--
       (1) by redesignating subsection (j) as subsection (k); and
       (2) by inserting after subsection (i) the following:
       ``(j) Inclusion.--Not later than 90 days after the date of 
     enactment of the Energy Policy Act of 2005, the Architect of 
     the Capitol, the Sergeant at Arms of the Senate, and the 
     Chief Administrative Officer of the House of Representatives 
     shall establish procedures that apply the requirements of 
     this section to procurement for the Capitol Complex.''.
       (c) Education.--
       (1) In general.--The Architect of the Capitol shall 
     establish in the Capitol Complex a program of public 
     education regarding use by the Architect of the Capitol of 
     biobased products.
       (2) Purposes.--The purposes of the program shall be--
       (A) to establish the Capitol Complex as a showcase for the 
     existence and benefits of biobased products; and
       (B) to provide access to further information on biobased 
     products to occupants and visitors.
       (d) Procedure.--Requirements issued under the amendments 
     made by subsection (b) shall be made in accordance with 
     directives issued by the Committee on Rules and 
     Administration of the Senate and the Committee on House 
     Administration of the House of Representatives.

     SEC. 944. SMALL BUSINESS BIOPRODUCT MARKETING AND 
                   CERTIFICATION GRANTS.

       (a) In General.--Using amounts made available under 
     subsection (g), the Secretary of Agriculture (referred to in 
     this section as the ``Secretary'') shall make available on a 
     competitive basis grants to eligible entities described in 
     subsection (b) for the biobased product marketing and 
     certification purposes described in subsection (c).
       (b) Eligible Entities.--
       (1) In general.--An entity eligible for a grant under this 
     section is any manufacturer of biobased products that--
       (A) proposes to use the grant for the biobased product 
     marketing and certification purposes described in subsection 
     (c); and
       (B) has not previously received a grant under this section.
       (2) Preference.--In making grants under this section, the 
     Secretary shall provide a preference to an eligible entity 
     that has fewer than 50 employees.
       (c) Biobased Product Marketing and Certification Grant 
     Purposes.--A grant made under this section shall be used--
       (1) to provide working capital for marketing of biobased 
     products; and
       (2) to provide for the certification of biobased products 
     to--
       (A) qualify for the label described in section 9002(h)(1) 
     of the Farm Security and Rural Investment Act of 2002 (7 
     U.S.C. 8102(h)(1)); or
       (B) meet other biobased standards determined appropriate by 
     the Secretary.
       (d) Matching Funds.--
       (1) In general.--Grant recipients shall provide matching 
     non-Federal funds equal to the amount of the grant received.
       (2) Expenditure.--Matching funds shall be expended in 
     advance of grant funding, so that for every dollar of grant 
     that is advanced, an equal amount of matching funds shall 
     have been funded prior to submitting the request for 
     reimbursement.
       (e) Amount.--A grant made under this section shall not 
     exceed $100,000.
       (f) Administration.--The Secretary shall establish such 
     administrative requirements for grants under this section, 
     including requirements for applications for the grants, as 
     the Secretary considers appropriate.
       (g) Authorizations of Appropriations.--There are authorized 
     to be appropriated to make grants under this section--
       (1) $1,000,000 for fiscal year 2006; and
       (2) such sums as are necessary for each of fiscal years 
     2007 through 2015.

     SEC. 945. REGIONAL BIOECONOMY DEVELOPMENT GRANTS.

       (a) In General.--Using amounts made available under 
     subsection (g), the Secretary of Agriculture (referred to in 
     this section as the ``Secretary'') shall make available on a 
     competitive basis grants to eligible entities described in 
     subsection (b) for the purposes described in subsection (c).
       (b) Eligible Entities.--An entity eligible for a grant 
     under this section is any regional bioeconomy development 
     association, agricultural or energy trade association, or 
     Land Grant institution that--
       (1) proposes to use the grant for the purposes described in 
     subsection (c); and
       (2) has not previously received a grant under this section.
       (c) Regional Bioeconomy Development Association Grant 
     Purposes.--A grant made under this section shall be used to 
     support and promote the growth and development of the 
     bioeconomy within the region served by the eligible entity, 
     through coordination, education, outreach, and other 
     endeavors by the eligible entity.
       (d) Matching Funds.--
       (1) In general.--Grant recipients shall provide matching 
     non-Federal funds equal to the amount of the grant received.
       (2) Expenditure.--Matching funds shall be expended in 
     advance of grant funding, so that for every dollar of grant 
     that is advanced, an equal amount of matching funds shall 
     have been funded prior to submitting the request for 
     reimbursement.
       (e) Administration.--The Secretary shall establish such 
     administrative requirements for grants under this section, 
     including requirements for applications for the grants, as 
     the Secretary considers appropriate.
       (f) Amount.--A grant made under this section shall not 
     exceed $500,000.
       (g) Authorizations of Appropriations.--There are authorized 
     to be appropriated to make grants under this section--
       (1) $1,000,000 for fiscal year 2006; and
       (2) such sums as are necessary for each of fiscal years 
     2007 through 2015.

     SEC. 946. PREPROCESSING AND HARVESTING DEMONSTRATION GRANTS.

       (a) In General.--The Secretary of Agriculture (referred to 
     in this section as the ``Secretary'') shall make grants 
     available on a competitive basis to enterprises owned by 
     agricultural producers, for the purposes of demonstrating 
     cost-effective, cellulosic biomass innovations in--
       (1) preprocessing of feedstocks, including cleaning, 
     separating and sorting, mixing or blending, and chemical or 
     biochemical treatments, to add value and lower the cost of 
     feedstock processing at a biorefinery; or
       (2) 1-pass or other efficient, multiple crop harvesting 
     techniques.
       (b) Limitations on Grants.--
       (1) Number of grants.--Not more than 5 demonstration 
     projects per fiscal year shall be funded under this section.
       (2) Non-federal cost share.--The non-Federal cost share of 
     a project under this section shall be not less than 20 
     percent, as determined by the Secretary.
       (c) Condition of Grant.--To be eligible for a grant for a 
     project under this section, a recipient of a grant or a 
     participating entity shall agree to use the material 
     harvested under the project--
       (1) to produce ethanol; or
       (2) for another energy purpose, such as the generation of 
     heat or electricity.
       (d) Authorization for Appropriations.--There is authorized 
     to be appropriated to carry out this section $5,000,000 for 
     each of fiscal years 2006 through 2010.

     SEC. 947. EDUCATION AND OUTREACH.

       (a) In General.--The Secretary of Agriculture shall 
     establish, within the Department of Agriculture or through an 
     independent contracting entity, a program of education and 
     outreach on biobased fuels and biobased products consisting 
     of--
       (1) training and technical assistance programs for 
     feedstock producers to promote producer ownership, 
     investment, and participation in the operation of processing 
     facilities; and
       (2) public education and outreach to familiarize consumers 
     with the biobased fuels and biobased products.
       (b) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $1,000,000 for 
     each of fiscal years 2006 through 2010.

     SEC. 948. REPORTS.

       (a) Biobased Product Potential.--Not later than 1 year 
     after the date of enactment of this Act, the Secretary of 
     Agriculture (referred to in this section as the 
     ``Secretary'') shall submit to the Committee on Agriculture 
     of the House of Representatives and the Committee on 
     Agriculture, Nutrition, and Forestry of the Senate a report 
     that--
       (1) describes the economic potential for the United States 
     of the widespread production and use of commercial and 
     industrial biobased products through calendar year 2025; and
       (2) as the maximum extent practicable, identifies the 
     economic potential by product area.
       (b) Analysis of Economic Indicators.--Not later than 2 
     years after the date of enactment of this Act, the Secretary 
     shall submit to Congress an analysis of economic indicators 
     of the biobased economy.
                       Subtitle E--Nuclear Energy

     SEC. 951. NUCLEAR ENERGY.

       (a) In General.--The Secretary shall conduct programs of 
     civilian nuclear energy research,

[[Page 17873]]

     development, demonstration, and commercial application, 
     including activities described in this subtitle. Programs 
     under this subtitle shall take into consideration the 
     following objectives:
       (1) Enhancing nuclear power's viability as part of the 
     United States energy portfolio.
       (2) Providing the technical means to reduce the likelihood 
     of nuclear proliferation.
       (3) Maintaining a cadre of nuclear scientists and 
     engineers.
       (4) Maintaining National Laboratory and university nuclear 
     programs, including their infrastructure.
       (5) Supporting both individual researchers and 
     multidisciplinary teams of researchers to pioneer new 
     approaches in nuclear energy, science, and technology.
       (6) Developing, planning, constructing, acquiring, and 
     operating special equipment and facilities for the use of 
     researchers.
       (7) Supporting technology transfer and other appropriate 
     activities to assist the nuclear energy industry, and other 
     users of nuclear science and engineering, including 
     activities addressing reliability, availability, 
     productivity, component aging, safety, and security of 
     nuclear power plants.
       (8) Reducing the environmental impact of nuclear energy-
     related activities.
       (b) Authorization of Appropriations for Core Programs.--
     There are authorized to be appropriated to the Secretary to 
     carry out nuclear energy research, development, 
     demonstration, and commercial application activities, 
     including activities authorized under this subtitle, other 
     than those described in subsection (c)--
       (1) $330,000,000 for fiscal year 2007;
       (2) $355,000,000 for fiscal year 2008; and
       (3) $495,000,000 for fiscal year 2009.
       (c) Nuclear Infrastructure and Facilities.--There are 
     authorized to be appropriated to the Secretary to carry out 
     activities under section 955--
       (1) $135,000,000 for fiscal year 2007;
       (2) $140,000,000 for fiscal year 2008; and
       (3) $145,000,000 for fiscal year 2009.
       (d) Allocations.--From amounts authorized under subsection 
     (a), the following sums are authorized:
       (1) For activities under section 953--
       (A) $150,000,000 for fiscal year 2007;
       (B) $155,000,000 for fiscal year 2008; and
       (C) $275,000,000 for fiscal year 2009.
       (2) For activities under section 954--
       (A) $43,600,000 for fiscal year 2007;
       (B) $50,100,000 for fiscal year 2008; and
       (C) $56,000,000 for fiscal year 2009.
       (3) For activities under section 957, $6,000,000 for each 
     of fiscal years 2007 through 2009.
       (e) Limitation.--None of the funds authorized under this 
     section may be used to decommission the Fast Flux Test 
     Facility.

     SEC. 952. NUCLEAR ENERGY RESEARCH PROGRAMS.

       (a) Nuclear Energy Research Initiative.--The Secretary 
     shall carry out a Nuclear Energy Research Initiative for 
     research and development related to nuclear energy.
       (b) Nuclear Energy Systems Support Program.--The Secretary 
     shall carry out a Nuclear Energy Systems Support Program to 
     support research and development activities addressing 
     reliability, availability, productivity, component aging, 
     safety, and security of existing nuclear power plants.
       (c) Nuclear Power 2010 Program.--
       (1) In general.--The Secretary shall carry out a Nuclear 
     Power 2010 Program, consistent with recommendations of the 
     Nuclear Energy Research Advisory Committee of the Department 
     in the report entitled ``A Roadmap to Deploy New Nuclear 
     Power Plants in the United States by 2010'' and dated October 
     2001.
       (2) Administration.--The Program shall include--
       (A) use of the expertise and capabilities of industry, 
     institutions of higher education, and National Laboratories 
     in evaluation of advanced nuclear fuel cycles and fuels 
     testing;
       (B) consideration of a variety of reactor designs suitable 
     for both developed and developing nations;
       (C) participation of international collaborators in 
     research, development, and design efforts, as appropriate; 
     and
       (D) encouragement for participation by institutions of 
     higher education and industry.
       (d) Generation IV Nuclear Energy Systems Initiative.--
       (1) In general.--The Secretary shall carry out a Generation 
     IV Nuclear Energy Systems Initiative to develop an overall 
     technology plan for and to support research and development 
     necessary to make an informed technical decision about the 
     most promising candidates for eventual commercial 
     application.
       (2) Administration.--In conducting the Initiative, the 
     Secretary shall examine advanced proliferation-resistant and 
     passively safe reactor designs, including designs that--
       (A) are economically competitive with other electric power 
     generation plants;
       (B) have higher efficiency, lower cost, and improved safety 
     compared to reactors in operation on the date of enactment of 
     this Act;
       (C) use fuels that are proliferation resistant and have 
     substantially reduced production of high-level waste per unit 
     of output; and
       (D) use improved instrumentation.
       (e) Reactor Production of Hydrogen.--The Secretary shall 
     carry out research to examine designs for high-temperature 
     reactors capable of producing large-scale quantities of 
     hydrogen.

     SEC. 953. ADVANCED FUEL CYCLE INITIATIVE.

       (a) In General.--The Secretary, acting through the Director 
     of the Office of Nuclear Energy, Science and Technology, 
     shall conduct an advanced fuel recycling technology research, 
     development, and demonstration program (referred to in this 
     section as the ``program'') to evaluate proliferation-
     resistant fuel recycling and transmutation technologies that 
     minimize environmental and public health and safety impacts 
     as an alternative to aqueous reprocessing technologies 
     deployed as of the date of enactment of this Act in support 
     of evaluation of alternative national strategies for spent 
     nuclear fuel and the Generation IV advanced reactor concepts.
       (b) Annual Review.--The program shall be subject to annual 
     review by the Nuclear Energy Research Advisory Committee of 
     the Department or other independent entity, as appropriate.
       (c) International Cooperation.--In carrying out the 
     program, the Secretary is encouraged to seek opportunities to 
     enhance the progress of the program through international 
     cooperation.
       (d) Reports.--The Secretary shall submit, as part of the 
     annual budget submission of the Department, a report on the 
     activities of the program.

     SEC. 954. UNIVERSITY NUCLEAR SCIENCE AND ENGINEERING SUPPORT.

       (a) In General.--The Secretary shall conduct a program to 
     invest in human resources and infrastructure in the nuclear 
     sciences and related fields, including health physics, 
     nuclear engineering, and radiochemistry, consistent with 
     missions of the Department related to civilian nuclear 
     research, development, demonstration, and commercial 
     application.
       (b) Requirements.--In carrying out the program under this 
     section, the Secretary shall--
       (1) conduct a graduate and undergraduate fellowship program 
     to attract new and talented students, which may include 
     fellowships for students to spend time at National 
     Laboratories in the areas of nuclear science, engineering, 
     and health physics with a member of the National Laboratory 
     staff acting as a mentor;
       (2) conduct a junior faculty research initiation grant 
     program to assist universities in recruiting and retaining 
     new faculty in the nuclear sciences and engineering by 
     awarding grants to junior faculty for research on issues 
     related to nuclear energy engineering and science;
       (3) support fundamental nuclear sciences, engineering, and 
     health physics research through a nuclear engineering 
     education and research program;
       (4) encourage collaborative nuclear research among 
     industry, National Laboratories, and universities; and
       (5) support communication and outreach related to nuclear 
     science, engineering, and health physics.
       (c) University-National Laboratory Interactions.--The 
     Secretary shall conduct--
       (1) a fellowship program for professors at universities to 
     spend sabbaticals at National Laboratories in the areas of 
     nuclear science and technology; and
       (2) a visiting scientist program in which National 
     Laboratory staff can spend time in academic nuclear science 
     and engineering departments.
       (d) Strengthening University Research and Training Reactors 
     and Associated Infrastructure.--In carrying out the program 
     under this section, the Secretary may support--
       (1) converting research reactors from high-enrichment fuels 
     to low-enrichment fuels and upgrading operational 
     instrumentation;
       (2) consortia of universities to broaden access to 
     university research reactors;
       (3) student training programs, in collaboration with the 
     United States nuclear industry, in relicensing and upgrading 
     reactors, including through the provision of technical 
     assistance; and
       (4) reactor improvements as part of a taking into 
     consideration effort that emphasizes research, training, and 
     education, including through the Innovations in Nuclear 
     Infrastructure and Education Program or any similar program.
       (e) Operations and Maintenance.--Funding for a project 
     provided under this section may be used for a portion of the 
     operating and maintenance costs of a research reactor at a 
     university used in the project.
       (f) Definition.--In this section, the term ``junior 
     faculty'' means a faculty member who was awarded a doctorate 
     less than 10 years before receipt of an award from the grant 
     program described in subsection (b)(2).

     SEC. 955. DEPARTMENT OF ENERGY CIVILIAN NUCLEAR 
                   INFRASTRUCTURE AND FACILITIES.

       (a) In General.--The Secretary shall operate and maintain 
     infrastructure and facilities to support the nuclear energy 
     research, development, demonstration, and commercial 
     application programs, including radiological facilities 
     management, isotope production, and facilities management.
       (b) Duties.--In carrying this section, the Secretary 
     shall--
       (1) develop an inventory of nuclear science and engineering 
     facilities, equipment, expertise, and other assets at all of 
     the National Laboratories;
       (2) develop a prioritized list of nuclear science and 
     engineering plant and equipment improvements needed at each 
     of the National Laboratories;
       (3) consider the available facilities and expertise at all 
     National Laboratories and emphasize investments which 
     complement rather than duplicate capabilities; and
       (4) develop a timeline and a proposed budget for the 
     completion of deferred maintenance on

[[Page 17874]]

     plant and equipment, with the goal of ensuring that 
     Department programs under this subtitle will be generally 
     recognized to be among the best in the world.
       (c) Plan.--The Secretary shall develop a comprehensive plan 
     for the facilities at the Idaho National Laboratory, 
     especially taking into account the resources available at 
     other National Laboratories. In developing the plan, the 
     Secretary shall--
       (1) evaluate the facilities planning processes utilized by 
     other physical science and engineering research and 
     development institutions, both in the United States and 
     abroad, that are generally recognized as being among the best 
     in the world, and consider how those processes might be 
     adapted toward developing such facilities plan;
       (2) avoid duplicating, moving, or transferring nuclear 
     science and engineering facilities, equipment, expertise, and 
     other assets that currently exist at other National 
     Laboratories;
       (3) consider the establishment of a national transuranic 
     analytic chemistry laboratory as a user facility at the Idaho 
     National Laboratory;
       (4) include a plan to develop, if feasible, the Advanced 
     Test Reactor and Test Reactor Area into a user facility that 
     is more readily accessible to academic and industrial 
     researchers;
       (5) consider the establishment of a fast neutron source as 
     a user facility;
       (6) consider the establishment of new hot cells and the 
     configuration of hot cells most likely to advance research, 
     development, demonstration, and commercial application in 
     nuclear science and engineering, especially in the context of 
     the condition and availability of these facilities elsewhere 
     in the National Laboratories; and
       (7) include a timeline and a proposed budget for the 
     completion of deferred maintenance on plant and equipment.
       (d) Transmittal to Congress.--Not later than 1 year after 
     the date of enactment of this Act, the Secretary shall 
     transmit the plan under subsection (c) to Congress.

     SEC. 956. SECURITY OF NUCLEAR FACILITIES.

       The Secretary, acting through the Director of the Office of 
     Nuclear Energy, Science and Technology, shall conduct a 
     research and development program on cost-effective 
     technologies for increasing--
       (1) the safety of nuclear facilities from natural 
     phenomena; and
       (2) the security of nuclear facilities from deliberate 
     attacks.

     SEC. 957. ALTERNATIVES TO INDUSTRIAL RADIOACTIVE SOURCES.

       (a) Survey.--
       (1) In general.--Not later than August 1, 2006, the 
     Secretary shall submit to Congress the results of a survey of 
     industrial applications of large radioactive sources.
       (2) Administration.--The survey shall--
       (A) consider well-logging sources as 1 class of industrial 
     sources;
       (B) include information on current domestic and 
     international Department, Department of Defense, State 
     Department, and commercial programs to manage and dispose of 
     radioactive sources; and
       (C) analyze available disposal options for currently 
     deployed or future sources and, if deficiencies are noted for 
     either deployed or future sources, recommend legislative 
     options that Congress may consider to remedy identified 
     deficiencies.
       (b) Plan.--
       (1) In general.--In conjunction with the survey conducted 
     under subsection (a), the Secretary shall establish a 
     research and development program to develop alternatives to 
     sources described in subsection (a) that reduce safety, 
     environmental, or proliferation risks to either workers using 
     the sources or the public.
       (2) Accelerators.--Miniaturized particle accelerators for 
     well-logging or other industrial applications and portable 
     accelerators for production of short-lived radioactive 
     materials at an industrial site shall be considered as part 
     of the research and development efforts.
       (3) Report.--Not later than August 1, 2006, the Secretary 
     shall submit to Congress a report describing the details of 
     the program plan.
                       Subtitle F--Fossil Energy

     SEC. 961. FOSSIL ENERGY.

       (a) In General.--The Secretary shall carry out research, 
     development, demonstration, and commercial application 
     programs in fossil energy, including activities under this 
     subtitle, with the goal of improving the efficiency, 
     effectiveness, and environmental performance of fossil energy 
     production, upgrading, conversion, and consumption. Such 
     programs take into consideration the following objectives:
       (1) Increasing the energy conversion efficiency of all 
     forms of fossil energy through improved technologies.
       (2) Decreasing the cost of all fossil energy production, 
     generation, and delivery.
       (3) Promoting diversity of energy supply.
       (4) Decreasing the dependence of the United States on 
     foreign energy supplies.
       (5) Improving United States energy security.
       (6) Decreasing the environmental impact of energy-related 
     activities.
       (7) Increasing the export of fossil energy-related 
     equipment, technology, and services from the United States.
       (b) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary to carry out fossil 
     energy research, development, demonstration, and commercial 
     application activities, including activities authorized under 
     this subtitle--
       (1) $611,000,000 for fiscal year 2007;
       (2) $626,000,000 for fiscal year 2008; and
       (3) $641,000,000 for fiscal year 2009.
       (c) Allocations.--From amounts authorized under subsection 
     (a), the following sums are authorized:
       (1) For activities under section 962--
       (A) $367,000,000 for fiscal year 2007;
       (B) $376,000,000 for fiscal year 2008; and
       (C) $394,000,000 for fiscal year 2009.
       (2) For activities under section 964--
       (A) $20,000,000 for fiscal year 2007;
       (B) $25,000,000 for fiscal year 2008; and
       (C) $30,000,000 for fiscal year 2009.
       (3) For activities under section 966--
       (A) $1,500,000 for fiscal year 2007; and
       (B) $450,000 for each of fiscal years 2008 and 2009.
       (4) For the Office of Arctic Energy under section 3197 of 
     the Floyd D. Spence National Defense Authorization Act for 
     Fiscal Year 2001 (42 U.S.C. 7144d) $25,000,000 for each of 
     fiscal years 2007 through 2009.
       (d) Extended Authorization.--There are authorized to be 
     appropriated to the Secretary for the Office of Arctic Energy 
     established under section 3197 of the Floyd D. Spence 
     National Defense Authorization Act for Fiscal Year 2001 (42 
     U.S.C. 7144d) $25,000,000 for each of fiscal years 2010 
     through 2012.
       (e) Limitations.--
       (1) Uses.--None of the funds authorized under this section 
     may be used for Fossil Energy Environmental Restoration or 
     Import/Export Authorization.
       (2) Institutions of higher education.--Of the funds 
     authorized under subsection (c)(2), not less than 20 percent 
     of the funds appropriated for each fiscal year shall be 
     dedicated to research and development carried out at 
     institutions of higher education.

     SEC. 962. COAL AND RELATED TECHNOLOGIES PROGRAM.

       (a) In General.--In addition to the programs authorized 
     under title IV, the Secretary shall conduct a program of 
     technology research, development, demonstration, and 
     commercial application for coal and power systems, including 
     programs to facilitate production and generation of coal-
     based power through--
       (1) innovations for existing plants (including mercury 
     removal);
       (2) gasification systems;
       (3) advanced combustion systems;
       (4) turbines for synthesis gas derived from coal;
       (5) carbon capture and sequestration research and 
     development;
       (6) coal-derived chemicals and transportation fuels;
       (7) liquid fuels derived from low rank coal water slurry;
       (8) solid fuels and feedstocks;
       (9) advanced coal-related research;
       (10) advanced separation technologies; and
       (11) fuel cells for the operation of synthesis gas derived 
     from coal.
       (b) Cost and Performance Goals.--
       (1) In general.--In carrying out programs authorized by 
     this section, during each of calendar years 2008, 2010, 2012, 
     and 2016, and during each fiscal year beginning after 
     September 30, 2021, the Secretary shall identify cost and 
     performance goals for coal-based technologies that would 
     permit the continued cost-competitive use of coal for the 
     production of electricity, chemical feedstocks, and 
     transportation fuels.
       (2) Administration.--In establishing the cost and 
     performance goals, the Secretary shall--
       (A) consider activities and studies undertaken as of the 
     date of enactment of this Act by industry in cooperation with 
     the Department in support of the identification of the goals;
       (B) consult with interested entities, including--
       (i) coal producers;
       (ii) industries using coal;
       (iii) organizations that promote coal and advanced coal 
     technologies;
       (iv) environmental organizations;
       (v) organizations representing workers; and
       (vi) organizations representing consumers;
       (C) not later than 120 days after the date of enactment of 
     this Act, publish in the Federal Register proposed draft cost 
     and performance goals for public comments; and
       (D) not later than 180 days after the date of enactment of 
     this Act and every 4 years thereafter, submit to Congress a 
     report describing the final cost and performance goals for 
     the technologies that includes--
       (i) a list of technical milestones; and
       (ii) an explanation of how programs authorized in this 
     section will not duplicate the activities authorized under 
     the Clean Coal Power Initiative authorized under title IV.
       (c) Powder River Basin and Fort Union Lignite Coal Mercury 
     Removal.--
       (1) In general.--In addition to the programs authorized by 
     subsection (a), the Secretary shall establish a program to 
     test and develop technologies to control and remove mercury 
     emissions from subbituminous coal mined in the Powder River 
     Basin, and Fort Union lignite coals, that are used for the 
     generation of electricity.
       (2) Efficacy of mercury removal technology.--In carrying 
     out the program under paragraph (1), the Secretary shall 
     examine the efficacy of mercury removal technologies on coals 
     described in that paragraph that are blended with other types 
     of coal.
       (d) Fuel Cells.--
       (1) In general.--The Secretary shall conduct a program of 
     research, development, demonstration, and commercial 
     application on fuel cells for low-cost, high-efficiency, 
     fuel-flexible, modular power systems.
       (2) Demonstrations.--The demonstrations referred to in 
     paragraph (1) shall include solid

[[Page 17875]]

     oxide fuel cell technology for commercial, residential, and 
     transportation applications, and distributed generation 
     systems, using improved manufacturing production and 
     processes.

     SEC. 963. CARBON CAPTURE RESEARCH AND DEVELOPMENT PROGRAM.

       (a) In General.--The Secretary shall carry out a 10-year 
     carbon capture research and development program to develop 
     carbon dioxide capture technologies on combustion-based 
     systems for use--
       (1) in new coal utilization facilities; and
       (2) on the fleet of coal-based units in existence on the 
     date of enactment of this Act.
       (b) Objectives.--The objectives of the program under 
     subsection (a) shall be--
       (1) to develop carbon dioxide capture technologies, 
     including adsorption and absorption techniques and chemical 
     processes, to remove the carbon dioxide from gas streams 
     containing carbon dioxide potentially amenable to 
     sequestration;
       (2) to develop technologies that would directly produce 
     concentrated streams of carbon dioxide potentially amenable 
     to sequestration;
       (3) to increase the efficiency of the overall system to 
     reduce the quantity of carbon dioxide emissions released from 
     the system per megawatt generated; and
       (4) in accordance with the carbon dioxide capture program, 
     to promote a robust carbon sequestration program and continue 
     the work of the Department, in conjunction with the private 
     sector, through regional carbon sequestration partnerships.
       (c) Authorization of Appropriations.--From amounts 
     authorized under section 961(b), the following sums are 
     authorized for activities described in subsection (a)(2):
       (1) $25,000,000 for fiscal year 2006;
       (2) $30,000,000 for fiscal year 2007; and
       (3) $35,000,000 for fiscal year 2008

     SEC. 964. RESEARCH AND DEVELOPMENT FOR COAL MINING 
                   TECHNOLOGIES.

       (a) Establishment.--The Secretary shall carry out a program 
     for research and development on coal mining technologies.
       (b) Cooperation.--In carrying out the program, the 
     Secretary shall cooperate with appropriate Federal agencies, 
     coal producers, trade associations, equipment manufacturers, 
     institutions of higher education with mining engineering 
     departments, and other relevant entities.
       (c) Program.--The research and development activities 
     carried out under this section shall--
       (1) be guided by the mining research and development 
     priorities identified by the Mining Industry of the Future 
     Program and in the recommendations from relevant reports of 
     the National Academy of Sciences on mining technologies;
       (2) include activities exploring minimization of 
     contaminants in mined coal that contribute to environmental 
     concerns including development and demonstration of 
     electromagnetic wave imaging ahead of mining operations;
       (3) develop and demonstrate coal bed electromagnetic wave 
     imaging, spectroscopic reservoir analysis technology, and 
     techniques for horizontal drilling in order to--
       (A) identify areas of high coal gas content;
       (B) increase methane recovery efficiency;
       (C) prevent spoilage of domestic coal reserves; and
       (D) minimize water disposal associated with methane 
     extraction; and
       (4) expand mining research capabilities at institutions of 
     higher education.

     SEC. 965. OIL AND GAS RESEARCH PROGRAMS.

       (a) In General.--The Secretary shall conduct a program of 
     research, development, demonstration, and commercial 
     application of oil and gas, including--
       (1) exploration and production;
       (2) gas hydrates;
       (3) reservoir life and extension;
       (4) transportation and distribution infrastructure;
       (5) ultraclean fuels;
       (6) heavy oil, oil shale, and tar sands; and
       (7) related environmental research.
       (b) Objectives.--The objectives of this program shall 
     include advancing the science and technology available to 
     domestic petroleum producers, particularly independent 
     operators, to minimize the economic dislocation caused by the 
     decline of domestic supplies of oil and natural gas 
     resources.
       (c) Natural Gas and Oil Deposits Report.--Not later than 2 
     years after the date of enactment of this Act and every 2 
     years thereafter, the Secretary of the Interior, in 
     consultation with other appropriate Federal agencies, shall 
     submit to Congress a report on the latest estimates of 
     natural gas and oil reserves, reserves growth, and 
     undiscovered resources in Federal and State waters off the 
     coast of Louisiana, Texas, Alabama, and Mississippi.
       (d) Integrated Clean Power and Energy Research.--
       (1) Establishment of center.--The Secretary shall establish 
     a national center or consortium of excellence in clean energy 
     and power generation, using the resources of the Clean Power 
     and Energy Research Consortium in existence on the date of 
     enactment of this Act, to address the critical dependence of 
     the United States on energy and the need to reduce emissions.
       (2) Focus areas.--The center or consortium shall conduct a 
     program of research, development, demonstration, and 
     commercial application on integrating the following 6 focus 
     areas:
       (A) Efficiency and reliability of gas turbines for power 
     generation.
       (B) Reduction in emissions from power generation.
       (C) Promotion of energy conservation issues.
       (D) Effectively using alternative fuels and renewable 
     energy.
       (E) Development of advanced materials technology for oil 
     and gas exploration and use in harsh environments.
       (F) Education on energy and power generation issues.

     SEC. 966. LOW-VOLUME OIL AND GAS RESERVOIR RESEARCH PROGRAM.

       (a) Definitions of GIS.--In this section, the term ``GIS'' 
     means geographic information systems technology that 
     facilitates the organization and management of data with a 
     geographic component.
       (b) Program.--The Secretary shall establish a program of 
     research, development, demonstration, and commercial 
     application to maximize the productive capacity of marginal 
     wells and reservoirs.
       (c) Data Collection.--Under the program, the Secretary 
     shall collect data on--
       (1) the status and location of marginal wells and oil and 
     gas reservoirs;
       (2) the production capacity of marginal wells and oil and 
     gas reservoirs;
       (3) the location of low-pressure gathering facilities and 
     pipelines; and
       (4) the quantity of natural gas vented or flared in 
     association with crude oil production.
       (d) Analysis.--Under the program, the Secretary shall--
       (1) estimate the remaining producible reserves based on 
     variable pipeline pressures; and
       (2) recommend measures that will enable the continued 
     production of those resources.
       (e) Study.--
       (1) In general.--The Secretary may award a grant to an 
     organization of States that contain significant numbers of 
     marginal oil and natural gas wells to conduct an annual study 
     of low-volume natural gas reservoirs.
       (2) Organization with no gis capabilities.--If an 
     organization receiving a grant under paragraph (1) does not 
     have GIS capabilities, the organization shall contract with 
     an institution of higher education with GIS capabilities.
       (3) State geologists.--The organization receiving a grant 
     under paragraph (1) shall collaborate with the State 
     geologist of each State being studied.
       (f) Public Information.--The Secretary may use the data 
     collected and analyzed under this section to produce maps and 
     literature to disseminate to States to promote conservation 
     of natural gas reserves.

     SEC. 967. COMPLEX WELL TECHNOLOGY TESTING FACILITY.

       The Secretary, in coordination with industry leaders in 
     extended research drilling technology, shall establish a 
     Complex Well Technology Testing Facility at the Rocky 
     Mountain Oilfield Testing Center to increase the range of 
     extended drilling technologies.

     SEC. 968. METHANE HYDRATE RESEARCH.

       (a) In General.--The Methane Hydrate Research and 
     Development Act of 2000 (30 U.S.C. 1902 note; Public Law 106-
     193) is amended to read as follows:

     ``SECTION 1. SHORT TITLE.

       ``This Act may be cited as the `Methane Hydrate Research 
     and Development Act of 2000'.

     ``SEC. 2. FINDINGS.

       ``Congress finds that--
       ``(1) in order to promote energy independence and meet the 
     increasing demand for energy, the United States will require 
     a diversified portfolio of substantially increased quantities 
     of electricity, natural gas, and transportation fuels;
       ``(2) according to the report submitted to Congress by the 
     National Research Council entitled `Charting the Future of 
     Methane Hydrate Research in the United States', the total 
     United States resources of gas hydrates have been estimated 
     to be on the order of 200,000 trillion cubic feet;
       ``(3) according to the report of the National Commission on 
     Energy Policy entitled `Ending the Energy Stalemate--A 
     Bipartisan Strategy to Meet America's Energy Challenge', and 
     dated December 2004, the United States may be endowed with 
     over 1/4 of the methane hydrate deposits in the world;
       ``(4) according to the Energy Information Administration, a 
     shortfall in natural gas supply from conventional and 
     unconventional sources is expected to occur in or about 2020; 
     and
       ``(5) the National Academy of Sciences states that methane 
     hydrate may have the potential to alleviate the projected 
     shortfall in the natural gas supply.

     ``SEC. 3. DEFINITIONS.

       ``In this Act:
       ``(1) Contract.--The term `contract' means a procurement 
     contract within the meaning of section 6303 of title 31, 
     United States Code.
       ``(2) Cooperative agreement.--The term `cooperative 
     agreement' means a cooperative agreement within the meaning 
     of section 6305 of title 31, United States Code.
       ``(3) Director.--The term `Director' means the Director of 
     the National Science Foundation.
       ``(4) Grant.--The term `grant' means a grant awarded under 
     a grant agreement (within the meaning of section 6304 of 
     title 31, United States Code).
       ``(5) Industrial enterprise.--The term `industrial 
     enterprise' means a private, nongovernmental enterprise that 
     has an expertise or capability that relates to methane 
     hydrate research and development.
       ``(6) Institution of higher education.--The term 
     `institution of higher education' means an institution of 
     higher education (as defined in

[[Page 17876]]

     section 102 of the Higher Education Act of 1965 (20 U.S.C. 
     1002)).
       ``(7) Secretary.--The term `Secretary' means the Secretary 
     of Energy, acting through the Assistant Secretary for Fossil 
     Energy.
       ``(8) Secretary of commerce.--The term `Secretary of 
     Commerce' means the Secretary of Commerce, acting through the 
     Administrator of the National Oceanic and Atmospheric 
     Administration.
       ``(9) Secretary of defense.--The term `Secretary of 
     Defense' means the Secretary of Defense, acting through the 
     Secretary of the Navy.
       ``(10) Secretary of the interior.--The term `Secretary of 
     the Interior' means the Secretary of the Interior, acting 
     through the Director of the United States Geological Survey, 
     the Director of the Bureau of Land Management, and the 
     Director of the Minerals Management Service.

     ``SEC. 4. METHANE HYDRATE RESEARCH AND DEVELOPMENT PROGRAM.

       ``(a) In General.--
       ``(1) Commencement of program.--Not later than 90 days 
     after the date of enactment of the Energy Research, 
     Development, Demonstration, and Commercial Application Act of 
     2005, the Secretary, in consultation with the Secretary of 
     Commerce, the Secretary of Defense, the Secretary of the 
     Interior, and the Director, shall commence a program of 
     methane hydrate research and development in accordance with 
     this section.
       ``(2) Designations.--The Secretary, the Secretary of 
     Commerce, the Secretary of Defense, the Secretary of the 
     Interior, and the Director shall designate individuals to 
     carry out this section.
       ``(3) Coordination.--The individual designated by the 
     Secretary shall coordinate all activities within the 
     Department of Energy relating to methane hydrate research and 
     development.
       ``(4) Meetings.--The individuals designated under paragraph 
     (2) shall meet not later than 180 days after the date of 
     enactment of the Energy Research, Development, Demonstration, 
     and Commercial Application Act of 2005 and not less 
     frequently than every 180 days thereafter to--
       ``(A) review the progress of the program under paragraph 
     (1); and
       ``(B) coordinate interagency research and partnership 
     efforts in carrying out the program.
       ``(b) Grants, Contracts, Cooperative Agreements, 
     Interagency Funds Transfer Agreements, and Field Work 
     Proposals.--
       ``(1) Assistance and coordination.--In carrying out the 
     program of methane hydrate research and development 
     authorized by this section, the Secretary may award grants 
     to, or enter into contracts or cooperative agreements with, 
     institutions of higher education, oceanographic institutions, 
     and industrial enterprises to--
       ``(A) conduct basic and applied research to identify, 
     explore, assess, and develop methane hydrate as a 
     commercially viable source of energy;
       ``(B) identify methane hydrate resources through remote 
     sensing;
       ``(C) acquire and reprocess seismic data suitable for 
     characterizing methane hydrate accumulations;
       ``(D) assist in developing technologies required for 
     efficient and environmentally sound development of methane 
     hydrate resources;
       ``(E) promote education and training in methane hydrate 
     resource research and resource development through 
     fellowships or other means for graduate education and 
     training;
       ``(F) conduct basic and applied research to assess and 
     mitigate the environmental impact of hydrate degassing 
     (including both natural degassing and degassing associated 
     with commercial development);
       ``(G) develop technologies to reduce the risks of drilling 
     through methane hydrates; and
       ``(H) conduct exploratory drilling, well testing, and 
     production testing operations on permafrost and non-
     permafrost gas hydrates in support of the activities 
     authorized by this paragraph, including drilling of 1 or more 
     full-scale production test wells.
       ``(2) Competitive peer review.--Funds made available under 
     paragraph (1) shall be made available based on a competitive 
     process using external scientific peer review of proposed 
     research.
       ``(c) Methane Hydrates Advisory Panel.--
       ``(1) In general.--The Secretary shall establish an 
     advisory panel (including the hiring of appropriate staff) 
     consisting of representatives of industrial enterprises, 
     institutions of higher education, oceanographic institutions, 
     State agencies, and environmental organizations with 
     knowledge and expertise in the natural gas hydrates field, 
     to--
       ``(A) assist in developing recommendations and broad 
     programmatic priorities for the methane hydrate research and 
     development program carried out under subsection (a)(1);
       ``(B) provide scientific oversight for the methane hydrates 
     program, including assessing progress toward program goals, 
     evaluating program balance, and providing recommendations to 
     enhance the quality of the program over time; and
       ``(C) not later than 2 years after the date of enactment of 
     the Energy Research, Development, Demonstration, and 
     Commercial Application Act of 2005, and at such later dates 
     as the panel considers advisable, submit to Congress--
       ``(i) an assessment of the methane hydrate research 
     program; and
       ``(ii) an assessment of the 5-year research plan of the 
     Department of Energy.
       ``(2) Conflicts of interest.--In appointing each member of 
     the advisory panel established under paragraph (1), the 
     Secretary shall ensure, to the maximum extent practicable, 
     that the appointment of the member does not pose a conflict 
     of interest with respect to the duties of the member under 
     this Act.
       ``(3) Meetings.--The advisory panel shall--
       ``(A) hold the initial meeting of the advisory panel not 
     later than 180 days after the date of establishment of the 
     advisory panel; and
       ``(B) meet biennially thereafter.
       ``(4) Coordination.--The advisory panel shall coordinate 
     activities of the advisory panel with program managers of the 
     Department of Energy at appropriate National Laboratories.
       ``(d) Construction Costs.--None of the funds made available 
     to carry out this section may be used for the construction of 
     a new building or the acquisition, expansion, remodeling, or 
     alteration of an existing building (including site grading 
     and improvement and architect fees).
       ``(e) Responsibilities of the Secretary.--In carrying out 
     subsection (b)(1), the Secretary shall--
       ``(1) facilitate and develop partnerships among government, 
     industrial enterprises, and institutions of higher education 
     to research, identify, assess, and explore methane hydrate 
     resources;
       ``(2) undertake programs to develop basic information 
     necessary for promoting long-term interest in methane hydrate 
     resources as an energy source;
       ``(3) ensure that the data and information developed 
     through the program are accessible and widely disseminated as 
     needed and appropriate;
       ``(4) promote cooperation among agencies that are 
     developing technologies that may hold promise for methane 
     hydrate resource development;
       ``(5) report annually to Congress on the results of actions 
     taken to carry out this Act; and
       ``(6) ensure, to the maximum extent practicable, greater 
     participation by the Department of Energy in international 
     cooperative efforts.

     ``SEC. 5. NATIONAL RESEARCH COUNCIL STUDY.

       ``(a) Agreement for Study.--The Secretary shall offer to 
     enter into an agreement with the National Research Council 
     under which the National Research Council shall--
       ``(1) conduct a study of the progress made under the 
     methane hydrate research and development program implemented 
     under this Act; and
       ``(2) make recommendations for future methane hydrate 
     research and development needs.
       ``(b) Report.--Not later than September 30, 2009, the 
     Secretary shall submit to Congress a report containing the 
     findings and recommendations of the National Research Council 
     under this section.

     ``SEC. 6. REPORTS AND STUDIES FOR CONGRESS.

       ``The Secretary shall provide to the Committee on Science 
     of the House of Representatives and the Committee on Energy 
     and Natural Resources of the Senate copies of any report or 
     study that the Department of Energy prepares at the direction 
     of any committee of Congress relating to the methane hydrate 
     research and development program implemented under this Act.

     ``SEC. 7. AUTHORIZATION OF APPROPRIATIONS.

       ``There are authorized to be appropriated to the Secretary 
     to carry out this Act, to remain available until expended--
       ``(1) $15,000,000 for fiscal year 2006;
       ``(2) $20,000,000 for fiscal year 2007;
       ``(3) $30,000,000 for fiscal year 2008;
       ``(4) $40,000,000 for fiscal year 2009; and
       ``(5) $50,000,000 for fiscal year 2010.''.
       (b) Reclassification.--The Law Revision Counsel shall 
     reclassify the Methane Hydrate Research and Development Act 
     of 2000 (30 U.S.C. 1902 note; Public Law 106-193) to a new 
     chapter at the end of title 30, United States Code.
                          Subtitle G--Science

     SEC. 971. SCIENCE.

       (a) In General.--The Secretary shall conduct, through the 
     Office of Science, programs of research, development, 
     demonstration, and commercial application in high energy 
     physics, nuclear physics, biological and environmental 
     research, basic energy sciences, advanced scientific 
     computing research, and fusion energy sciences, including 
     activities described in this subtitle. The programs shall 
     include support for facilities and infrastructure, education, 
     outreach, information, analysis, and coordination activities.
       (b) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary to carry out research, 
     development, demonstration, and commercial application 
     activities of the Office of Science, including activities 
     authorized under this subtitle (including the amounts 
     authorized under the amendment made by section 976(b) and 
     including basic energy sciences, advanced scientific and 
     computing research, biological and environmental research, 
     fusion energy sciences, high energy physics, nuclear physics, 
     research analysis, and infrastructure support)--
       (1) $4,153,000,000 for fiscal year 2007;
       (2) $4,586,000,000 for fiscal year 2008; and
       (3) $5,200,000,000 for fiscal year 2009.
       (c) Allocations.--From amounts authorized under subsection 
     (b), the following sums are authorized:
       (1) For activities under the Fusion Energy Sciences program 
     (including activities under section 972)--
       (A) $355,500,000 for fiscal year 2007;
       (B) $369,500,000 for fiscal year 2008;
       (C) $384,800,000 for fiscal year 2009; and
       (D) in addition to the amounts authorized under 
     subparagraphs (A), (B), and (C), such sums as may be 
     necessary for ITER construction, consistent with the 
     limitations of section 972(c)(5).

[[Page 17877]]

       (2) For activities under the catalysis research program 
     under section 973--
       (A) $36,500,000 for fiscal year 2007;
       (B) $38,200,000 for fiscal year 2008; and
       (C) such sums as may be necessary for fiscal year 2009.
       (3) For activities under the Systems Biology Program under 
     section 977 such sums as may be necessary for each of fiscal 
     years 2007 through 2009.
       (4) For activities under the Energy and Water Supplies 
     program under section 979, $30,000,000 for each of fiscal 
     years 2007 through 2009.
       (5) For the energy research fellowships programs under 
     section 984, $40,000,000 for each of fiscal years 2007 
     through 2009.
       (6) For the advanced scientific computing activities under 
     section 976--
       (A) $270,000,000 for fiscal year 2007;
       (B) $350,000,000 for fiscal year 2008; and
       (C) $375,000,000 for fiscal year 2009.
       (7) For the science and engineering education pilot program 
     under section 983--
       (A) $4,000,000 for each of fiscal years 2007 and 2008; and
       (B) $8,000,000 for fiscal year 2009.
       (d) Integrated Bioenergy Research and Development.--In 
     addition to amounts otherwise authorized by this section, 
     there are authorized to be appropriated to the Secretary for 
     integrated bioenergy research and development programs, 
     projects, and activities, $49,000,000 for each of the fiscal 
     years 2005 through 2009. Activities funded under this 
     subsection shall be coordinated with ongoing related programs 
     of other Federal agencies, including the Plant Genome Program 
     of the National Science Foundation. Of the funds authorized 
     under this subsection, at least $5,000,000 for each fiscal 
     year shall be for training and education targeted to minority 
     and socially disadvantaged farmers and ranchers.

     SEC. 972. FUSION ENERGY SCIENCES PROGRAM.

       (a) Declaration of Policy.--It shall be the policy of the 
     United States to conduct research, development, 
     demonstration, and commercial applications to provide for the 
     scientific, engineering, and commercial infrastructure 
     necessary to ensure that the United States is competitive 
     with other countries in providing fusion energy for its own 
     needs and the needs of other countries, including by 
     demonstrating electric power or hydrogen production for the 
     United States energy grid using fusion energy at the earliest 
     date.
       (b) Planning.--
       (1) In general.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     a plan (with proposed cost estimates, budgets, and lists of 
     potential international partners) for the implementation of 
     the policy described in subsection (a) in a manner that 
     ensures that--
       (A) existing fusion research facilities are more fully 
     used;
       (B) fusion science, technology, theory, advanced 
     computation, modeling, and simulation are strengthened;
       (C) new magnetic and inertial fusion research and 
     development facilities are selected based on scientific 
     innovation and cost effectiveness, and the potential of the 
     facilities to advance the goal of practical fusion energy at 
     the earliest date practicable;
       (D) facilities that are selected are funded at a cost-
     effective rate;
       (E) communication of scientific results and methods between 
     the fusion energy science community and the broader 
     scientific and technology communities is improved;
       (F) inertial confinement fusion facilities are used to the 
     extent practicable for the purpose of inertial fusion energy 
     research and development;
       (G) attractive alternative inertial and magnetic fusion 
     energy approaches are more fully explored; and
       (H) to the extent practicable, the recommendations of the 
     Fusion Energy Sciences Advisory Committee in the report on 
     workforce planning, dated March 2004, are carried out, 
     including periodic reassessment of program needs.
       (2) Costs and schedules.--The plan shall also address the 
     status of and, to the extent practicable, costs and schedules 
     for--
       (A) the design and implementation of international or 
     national facilities for the testing of fusion materials; and
       (B) the design and implementation of international or 
     national facilities for the testing and development of key 
     fusion technologies.
       (c) United States Participation in ITER.--
       (1) Definitions.--In this subsection:
       (A) Construction.--
       (i) In general.--The term ``construction'' means--

       (I) the physical construction of the ITER facility; and
       (II) the physical construction, purchase, or manufacture of 
     equipment or components that are specifically designed for 
     the ITER facility.

       (ii) Exclusions.--The term ``construction'' does not 
     include the design of the facility, equipment, or components.
       (B) ITER.--The term ``ITER'' means the international 
     burning plasma fusion research project in which the President 
     announced United States participation on January 30, 2003, or 
     any similar international project.
       (2) Participation.--The United States may participate in 
     the ITER only in accordance with this subsection.
       (3) Agreement.--
       (A) In general.--The Secretary may negotiate an agreement 
     for United States participation in the ITER.
       (B) Contents.--Any agreement for United States 
     participation in the ITER shall, at a minimum--
       (i) clearly define the United States financial contribution 
     to construction and operating costs, as well as any other 
     costs associated with a project;
       (ii) ensure that the share of high-technology components of 
     the ITER manufactured in the United States is at least 
     proportionate to the United States financial contribution to 
     the ITER;
       (iii) ensure that the United States will not be financially 
     responsible for cost overruns in components manufactured in 
     other ITER participating countries;
       (iv) guarantee the United States full access to all data 
     generated by the ITER;
       (v) enable United States researchers to propose and carry 
     out an equitable share of the experiments at the ITER;
       (vi) provide the United States with a role in all 
     collective decisionmaking related to the ITER; and
       (vii) describe the process for discontinuing or 
     decommissioning the ITER and any United States role in that 
     process.
       (4) Plan.--
       (A) Development.--The Secretary, in consultation with the 
     Fusion Energy Sciences Advisory Committee, shall develop a 
     plan for the participation of United States scientists in the 
     ITER that shall include--
       (i) the United States research agenda for the ITER;
       (ii) methods to evaluate whether the ITER is promoting 
     progress toward making fusion a reliable and affordable 
     source of power; and
       (iii) a description of how work at the ITER will relate to 
     other elements of the United States fusion program.
       (B) Review.--The Secretary shall request a review of the 
     plan by the National Academy of Sciences.
       (5) Limitation.--No Federal funds shall be expended for the 
     construction of the ITER until the Secretary has submitted to 
     Congress--
       (A) the agreement negotiated in accordance with paragraph 
     (3) and 120 days have elapsed since that submission;
       (B) a report describing the management structure of the 
     ITER and providing a fixed dollar estimate of the cost of 
     United States participation in the construction of the ITER, 
     and 120 days have elapsed since that submission;
       (C) a report describing how United States participation in 
     the ITER will be funded without reducing funding for other 
     programs in the Office of Science (including other fusion 
     programs), and 60 days have elapsed since that submission; 
     and
       (D) the plan required by paragraph (4) (but not the 
     National Academy of Sciences review of that plan), and 60 
     days have elapsed since that submission.
       (6) Alternative to iter.--
       (A) In general.--If at any time during the negotiations on 
     the ITER, the Secretary determines that construction and 
     operation of the ITER is unlikely or infeasible, the 
     Secretary shall submit to Congress, along with the budget 
     request of the President submitted to Congress for the 
     following fiscal year, a plan for implementing a domestic 
     burning plasma experiment such as the Fusion Ignition 
     Research Experiment, including costs and schedules for the 
     plan.
       (B) Administration.--The Secretary shall--
       (i) refine the plan in full consultation with the Fusion 
     Energy Sciences Advisory Committee; and
       (ii) transmit the plan to the National Academy of Sciences 
     for review.

     SEC. 973. CATALYSIS RESEARCH PROGRAM.

       (a) Establishment.--The Secretary, acting through the 
     Office of Science, shall support a program of research and 
     development in catalysis science consistent with the 
     statutory authorities of the Department related to research 
     and development.
       (b) Components.--The program shall include efforts to--
       (1) enable catalyst design using combinations of 
     experimental and mechanistic methodologies coupled with 
     computational modeling of catalytic reactions at the 
     molecular level;
       (2) develop techniques for high throughput synthesis, 
     assay, and characterization at nanometer and subnanometer 
     scales in-situ under actual operating conditions;
       (3) synthesize catalysts with specific site architectures;
       (4) conduct research on the use of precious metals for 
     catalysis; and
       (5) translate molecular understanding to the design of 
     catalytic compounds.
       (c) Duties of the Office of Science.--In carrying out the 
     program, the Director of the Office of Science shall--
       (1) support both individual investigators and 
     multidisciplinary teams of investigators to pioneer new 
     approaches in catalytic design;
       (2) develop, plan, construct, acquire, share, or operate 
     special equipment or facilities for the use of investigators 
     in collaboration with national user facilities, such as 
     nanoscience and engineering centers;
       (3) support technology transfer activities to benefit 
     industry and other users of catalysis science and 
     engineering; and
       (4) coordinate research and development activities with 
     industry and other Federal agencies.
       (d) Assessment.--Not later than 3 years after the date of 
     enactment of this Act, the Secretary shall enter into an 
     arrangement with the National Academy of Sciences to--
       (1) review the catalysis program to measure--

[[Page 17878]]

       (A) gains made in the fundamental science of catalysis; and
       (B) progress towards developing new fuels for energy 
     production and material fabrication processes; and
       (2) submit to Congress a report describing the results of 
     the review.

     SEC. 974. HYDROGEN.

       (a) In General.--The Secretary shall conduct a program of 
     fundamental research and development in support of programs 
     authorized under title VIII.
       (b) Methods.--The program shall include support for methods 
     of generating hydrogen without the use of natural gas.

     SEC. 975. SOLID STATE LIGHTING.

       The Secretary shall conduct a program of fundamental 
     research on solid state lighting in support of the Next 
     Generation Lighting Initiative carried out under section 912.

     SEC. 976. ADVANCED SCIENTIFIC COMPUTING FOR ENERGY MISSIONS.

       (a) Program.--
       (1) In general.--The Secretary shall conduct an advanced 
     scientific computing research and development program that 
     includes activities related to applied mathematics and 
     activities authorized by the Department of Energy High-End 
     Computing Revitalization Act of 2004 (15 U.S.C. 5541 et 
     seq.).
       (2) Goal.--The Secretary shall carry out the program with 
     the goal of supporting departmental missions, and providing 
     the high-performance computational, networking, advanced 
     visualization technologies, and workforce resources, that are 
     required for world leadership in science.
       (b) High-Performance Computing.--Section 203 of the High-
     Performance Computing Act of 1991 (15 U.S.C. 5523) is amended 
     to read as follows:

     ``SEC. 203. DEPARTMENT OF ENERGY ACTIVITIES.

       ``(a) General Responsibilities.--As part of the Program 
     described in title I, the Secretary of Energy shall--
       ``(1) conduct and support basic and applied research in 
     high-performance computing and networking to support 
     fundamental research in science and engineering disciplines 
     related to energy applications; and
       ``(2) provide computing and networking infrastructure 
     support, including--
       ``(A) the provision of high-performance computing systems 
     that are among the most advanced in the world in terms of 
     performance in solving scientific and engineering problems; 
     and
       ``(B) support for advanced software and applications 
     development for science and engineering disciplines related 
     to energy applications.
       ``(b) Authorization of Appropriations.--There are 
     authorized to be appropriated to the Secretary of Energy such 
     sums as are necessary to carry out this section.''.

     SEC. 977. SYSTEMS BIOLOGY PROGRAM.

       (a) Program.--
       (1) Establishment.--The Secretary shall establish a 
     research, development, and demonstration program in microbial 
     and plant systems biology, protein science, and computational 
     biology to support the energy, national security, and 
     environmental missions of the Department.
       (2) Grants.--The program shall support individual 
     researchers and multidisciplinary teams of researchers 
     through competitive, merit-reviewed grants.
       (3) Consultation.--In carrying out the program, the 
     Secretary shall consult with other Federal agencies that 
     conduct genetic and protein research.
       (b) Goals.--The program shall have the goal of developing 
     technologies and methods based on the biological functions of 
     genomes, microbes, and plants that--
       (1) can facilitate the production of fuels, including 
     hydrogen;
       (2) convert carbon dioxide to organic carbon;
       (3) detoxify soils and water, including at facilities of 
     the Department, contaminated with heavy metals and 
     radiological materials; and
       (4) address other Department missions as identified by the 
     Secretary.
       (c) Plan.--
       (1) Development of plan.--Not later than 1 year after the 
     date of enactment of this Act, the Secretary shall prepare 
     and transmit to Congress a research plan describing how the 
     program authorized pursuant to this section will be 
     undertaken to accomplish the program goals established in 
     subsection (b).
       (2) Review of plan.--The Secretary shall contract with the 
     National Academy of Sciences to review the research plan 
     developed under this subsection. The Secretary shall transmit 
     the review to Congress not later than 18 months after 
     transmittal of the research plan under paragraph (1), along 
     with the Secretary's response to the recommendations 
     contained in the review.
       (d) User Facilities and Ancillary Equipment.--Within the 
     funds authorized to be appropriated pursuant to this 
     subtitle, amounts shall be available for projects to develop, 
     plan, construct, acquire, or operate special equipment, 
     instrumentation, or facilities, including user facilities at 
     National Laboratories, for researchers conducting research, 
     development, demonstration, and commercial application in 
     systems biology and proteomics and associated biological 
     disciplines.
       (e) Prohibition on Biomedical and Human Cell and Human 
     Subject Research.--
       (1) No biomedical research.--In carrying out the program 
     under this section, the Secretary shall not conduct 
     biomedical research.
       (2) Limitations.--Nothing in this section shall authorize 
     the Secretary to conduct any research or demonstrations--
       (A) on human cells or human subjects; or
       (B) designed to have direct application with respect to 
     human cells or human subjects.

     SEC. 978. FISSION AND FUSION ENERGY MATERIALS RESEARCH 
                   PROGRAM.

       (a) In General.--Along with the budget request of the 
     President submitted to Congress for fiscal year 2007, the 
     Secretary shall establish a research and development program 
     on material science issues presented by advanced fission 
     reactors and the fusion energy program of the Department.
       (b) Administration.--In carrying out the program, the 
     Secretary shall develop--
       (1) a catalog of material properties required for 
     applications described in subsection (a);
       (2) theoretical models for materials possessing the 
     required properties;
       (3) benchmark models against existing data; and
       (4) a roadmap to guide further research and development in 
     the area covered by the program.

     SEC. 979. ENERGY AND WATER SUPPLIES.

       (a) In General.--The Secretary shall carry out a program of 
     research, development, demonstration, and commercial 
     application to--
       (1) address energy-related issues associated with provision 
     of adequate water supplies, optimal management, and efficient 
     use of water;
       (2) address water-related issues associated with the 
     provision of adequate supplies, optimal management, and 
     efficient use of energy; and
       (3) assess the effectiveness of existing programs within 
     the Department and other Federal agencies to address these 
     energy and water related issues.
       (b) Program Elements.--The program under this section shall 
     include--
       (1) arsenic treatment;
       (2) desalination; and
       (3) planning, analysis, and modeling of energy and water 
     supply and demand.
       (c) Collaboration.--In carrying out this section, the 
     Secretary shall consult with the Administrator of the 
     Environmental Protection Agency, the Secretary of the 
     Interior, the Chief Engineer of the Army Corps of Engineers, 
     the Secretary of Commerce, the Secretary of Defense, and 
     other Federal agencies as appropriate.
       (d) Facilities.--The Secretary may utilize all existing 
     facilities within the Department and may design and construct 
     additional facilities as needed to carry out the purposes of 
     this program.
       (e) Advisory Committee.--The Secretary shall establish or 
     utilize an advisory committee to provide independent advice 
     and review of the program.
       (f) Reports.--Not later than 2 years after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     a report on the assessment described in subsection (b) and 
     recommendations for future actions.

     SEC. 980. SPALLATION NEUTRON SOURCE.

       (a) Definitions.--In this section:
       (1) SING.--The term ``SING'' means the Spallation Neutron 
     Source Instruments Next Generation major item of equipment.
       (2) SNS power upgrade.--The term ``SNS power upgrade'' 
     means the Spallation Neutron Source power upgrade described 
     in the 20-year facilities plan of the Office of Science of 
     the Department.
       (3) SNS second target station.--The term ``SNS second 
     target station'' the Spallation Neutron Source second target 
     station described in the 20-year facilities plan of the 
     Office of Science of the Department.
       (4) Spallation neutron source facility.--The terms 
     ``Spallation Neutron Source Facility'' and ``Facility'' mean 
     the completed Spallation Neutron Source scientific user 
     facility located at Oak Ridge National Laboratory, Oak Ridge, 
     Tennessee.
       (5) Spallation neutron source project.--The terms 
     ``Spallation Neutron Source Project'' and ``Project'' means 
     Department Project 99-E-334, Oak Ridge National Laboratory, 
     Oak Ridge, Tennessee.
       (b) Spallation Neutron Source Project.--
       (1) In general.--The Secretary shall submit to Congress, as 
     part of the annual budget request of the President submitted 
     to Congress, a report on progress on the Spallation Neutron 
     Source Project.
       (2) Contents.--The report shall include for the Project--
       (A) a description of the achievement of milestones;
       (B) a comparison of actual costs to estimated costs; and
       (C) any changes in estimated Project costs or schedule.
       (c) Spallation Neutron Source Facility Plan.--
       (1) In general.--The Secretary shall develop an operational 
     plan for the Spallation Neutron Source Facility that ensures 
     that the Facility is employed to the full capability of the 
     Facility in support of the study of advanced materials, 
     nanoscience, and other missions of the Office of Science of 
     the Department.
       (2) Plan.--The operational plan shall--
       (A) include a plan for the operation of an effective 
     scientific user program that--
       (i) is based on peer review of proposals submitted for use 
     of the Facility;
       (ii) includes scientific and technical support to ensure 
     that external users, including researchers based at 
     institutions of higher education, are able to make full use 
     of a variety of high quality scientific instruments; and
       (iii) phases in systems upgrades to ensure that the 
     Facility remains at the forefront of international scientific 
     endeavors in the field of the

[[Page 17879]]

     Facility throughout the operating life of the Facility;
       (B) include an ongoing program to develop new instruments 
     that builds on the high performance neutron source and that 
     allows neutron scattering techniques to be applied to a 
     growing range of scientific problems and disciplines; and
       (C) address the status of and, to the maximum extent 
     practicable, costs and schedules for--
       (i) full user mode operations of the Facility;
       (ii) instrumentation built at the Facility during the 
     operating phase through full use of the experimental hall, 
     including the SING;
       (iii) the SNS power upgrade; and
       (iv) the SNS second target station.
       (d) Authorization of Appropriations.--
       (1) Spallation neutron source project.--There is authorized 
     to be appropriated to carry out the Spallation Neutron Source 
     Project for the lifetime of the Project $1,411,700,000 for 
     total project costs, of which--
       (A) $1,192,700,000 shall be used for the costs of 
     construction; and
       (B) $219,000,000 shall be used for other Project costs.
       (2) Spallation neutron source facility.--
       (A) In general.--Except as provided in subparagraph (B), 
     there is authorized to be appropriated for the Spallation 
     Neutron Source Facility for--
       (i) the SING, $75,000,000 for each of fiscal year 2007 
     through 2009; and
       (ii) the SNS power upgrade, $160,000,000, to remain 
     available until expended.
       (B) Insufficient stockpiles of heavy water.--If stockpiles 
     of heavy water of the Department are insufficient to meet the 
     needs of the Facility, there is authorized to be appropriated 
     for the Facility $12,000,000 for fiscal year 2007.

     SEC. 981. RARE ISOTOPE ACCELERATOR.

       (a) Establishment.--The Secretary shall construct and 
     operate a Rare Isotope Accelerator. The Secretary shall 
     commence construction no later than September 30, 2008.
       (b) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary such sums as may be 
     necessary to carry out this section. The Secretary shall not 
     spend more than $1,100,000,000 in Federal funds for all 
     activities associated with the Rare Isotope Accelerator, 
     prior to operation of the Accelerator.

     SEC. 982. OFFICE OF SCIENTIFIC AND TECHNICAL INFORMATION.

       The Secretary, through the Office of Scientific and 
     Technical Information, shall maintain within the Department 
     publicly available collections of scientific and technical 
     information resulting from research, development, 
     demonstration, and commercial applications activities 
     supported by the Department.

     SEC. 983. SCIENCE AND ENGINEERING EDUCATION PILOT PROGRAM.

       (a) Establishment of Pilot Program.--The Secretary shall 
     award a grant to a Southeastern United States consortium of 
     major research universities that currently advances science 
     and education by partnering with National Laboratories, to 
     establish a regional pilot program of its SEEK-16 program for 
     enhancing scientific, technological, engineering, and 
     mathematical literacy, creativity, and decision-making. The 
     consortium shall include leading research universities, 1 or 
     more universities that train substantial numbers of 
     elementary and secondary school teachers, and (where 
     appropriate) National Laboratories.
       (b) Program Elements.--The regional pilot program shall 
     include--
       (1) expanding strategic, formal partnerships among 
     universities with strength in research, universities that 
     train substantial numbers of elementary and secondary school 
     teachers, and the private sector;
       (2) combining Department expertise with 1 or more National 
     Aeronautics and Space Administration Educator Resource 
     Centers;
       (3) developing programs to permit current and future 
     teachers to participate in ongoing research projects at 
     National Laboratories and research universities and to adapt 
     lessons learned to the classroom;
       (4) designing and implementing course work;
       (5) designing and implementing a strategy for measuring and 
     assessing progress under the program; and
       (6) developing models for transferring knowledge gained 
     under the pilot program to other institutions and areas of 
     the United States.
       (c) Categorization.--A grant under this section shall be 
     considered an authorized activity under section 3165 of the 
     Department of Energy Science Education Enhancement Act (42 
     U.S.C. 7381b).
       (d) Report.--No later than 2 years after the award of the 
     grant, the Secretary shall transmit to Congress a report 
     outlining lessons learned and, if determined appropriate by 
     the Secretary, containing a plan for expanding the program 
     throughout the United States.

     SEC. 984. ENERGY RESEARCH FELLOWSHIPS.

       (a) Postdoctoral Fellowship Program.--The Secretary shall 
     establish a program under which the Secretary provides 
     fellowships to encourage outstanding young scientists and 
     engineers to pursue postdoctoral research appointments in 
     energy research and development at institutions of higher 
     education of their choice.
       (b) Senior Research Fellowships.--
       (1) In general.--The Secretary shall establish a program 
     under which the Secretary provides fellowships to allow 
     outstanding senior researchers and their research groups in 
     energy research and development to explore research and 
     development topics of their choosing for a period of not less 
     than 3 years, to be determined by the Secretary.
       (2) Consideration.--In providing a fellowship under the 
     program described in paragraph (1), the Secretary shall 
     consider--
       (A) the past scientific or technical accomplishment of a 
     senior researcher; and
       (B) the potential for continued accomplishment by the 
     researcher during the period of the fellowship.

     SEC. 984A. SCIENCE AND TECHNOLOGY SCHOLARSHIP PROGRAM.

       (a) In General.--The Secretary is authorized to establish a 
     Science and Technology Scholarship Program to award 
     scholarships to individuals that is designed to recruit and 
     prepare students for careers in the Department and National 
     Laboratories.
       (b) Service Requirement.--The Secretary may require that an 
     individual receiving a scholarship under this section serve 
     as a full-time employee of the Department or a National 
     Laboratory for a fixed period in return for receiving the 
     scholarship.
                 Subtitle H--International Cooperation

     SEC. 985. WESTERN HEMISPHERE ENERGY COOPERATION.

       (a) Program.--The Secretary shall carry out a program to 
     promote cooperation on energy issues with countries of the 
     Western Hemisphere.
       (b) Activities.--Under the program, the Secretary shall 
     fund activities to work with countries of the Western 
     Hemisphere to--
       (1) increase the production of energy supplies;
       (2) improve energy efficiency; and
       (3) assist in the development and transfer of energy supply 
     and efficiency technologies that would have a beneficial 
     impact on world energy markets.
       (c) Participation by Institutions of Higher Education.--To 
     the extent practicable, the Secretary shall carry out the 
     program under this section with the participation of 
     institutions of higher education so as to take advantage of 
     the acceptance of institutions of higher education by 
     countries of the Western Hemisphere as sources of unbiased 
     technical and policy expertise when assisting the Secretary 
     in--
       (1) evaluating new technologies;
       (2) resolving technical issues;
       (3) working with those countries in the development of new 
     policies; and
       (4) training policymakers, particularly in the case of 
     institutions of higher education that involve the 
     participation of minority students, such as--
       (A) Hispanic-serving institutions; and
       (B) part B institutions.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section--
       (1) $10,000,000 for fiscal year 2007;
       (2) $13,000,000 for fiscal year 2008; and
       (3) $16,000,000 for fiscal year 2009.

     SEC. 986. COOPERATION BETWEEN UNITED STATES AND ISRAEL.

       (a) Findings.--Congress finds that--
       (1) on February 1, 1996, the United States and Israel 
     signed the agreement entitled ``Agreement between the 
     Department of Energy of the United States of America and the 
     Ministry of Energy and Infrastructure of Israel Concerning 
     Energy Cooperation'', (referred to in this section as the 
     ``Agreement'') to establish a framework for collaboration 
     between the United States and Israel in energy research and 
     development activities;
       (2) the Agreement entered into force in February 2000;
       (3) in February 2005, the Agreement was automatically 
     renewed for 1 additional 5-year period pursuant to Article X 
     of the Agreement; and
       (4) under the Agreement, the United States and Israel may 
     cooperate in energy research and development in a variety of 
     alternative and advanced energy sectors.
       (b) Report to Congress.--Not later than 90 days after the 
     date of enactment of this Act, the Secretary shall submit to 
     the Committee on Energy and Natural Resources and the 
     Committee on Foreign Relations of the Senate and the 
     Committee on Energy and Commerce and the Committee on 
     International Relations of the House of Representatives a 
     report that describes--
       (1) the ways in which the United States and Israel have 
     cooperated on energy research and development activities 
     under the Agreement;
       (2) projects initiated pursuant to the Agreement; and
       (3) plans for future cooperation and joint projects under 
     the Agreement.
       (c) Sense of Congress.--It is the sense of Congress that 
     energy cooperation between the Governments of the United 
     States and Israel is mutually beneficial in the development 
     of energy technology.

     SEC. 986A. INTERNATIONAL ENERGY TRAINING.

       (a) In General.--The Secretary, in consultation with the 
     Secretary of Commerce, the Secretary of the Interior, and 
     Secretary of State, and the Federal Energy Regulatory 
     Commission, shall coordinate training and outreach efforts 
     for international commercial energy markets in countries with 
     developing and restructuring economies.
       (b) Components.--The training and outreach efforts referred 
     to in subsection (a) may include--
       (1) production-related fiscal regimes;
       (2) grid and network issues;
       (3) energy user and demand side response;
       (4) international trade of energy; and
       (5) international transportation of energy.
       (c) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry

[[Page 17880]]

     out this section $1,500,000 for each of fiscal years 2007 
     through 2010.
           Subtitle I--Research Administration and Operations

     SEC. 987. AVAILABILITY OF FUNDS.

       Funds authorized to be appropriated to the Department under 
     this Act or an amendment made by this Act shall remain 
     available until expended.

     SEC. 988. COST SHARING.

       (a) Applicability.--Notwithstanding any other provision of 
     law, in carrying out a research, development, demonstration, 
     or commercial application program or activity that is 
     initiated after the date of enactment of this section, the 
     Secretary shall require cost-sharing in accordance with this 
     section.
       (b) Research and Development.--
       (1) In general.--Except as provided in paragraphs (2) and 
     (3) and subsection (f), the Secretary shall require not less 
     than 20 percent of the cost of a research or development 
     activity described in subsection (a) to be provided by a non-
     Federal source.
       (2) Exclusion.--Paragraph (1) shall not apply to a research 
     or development activity described in subsection (a) that is 
     of a basic or fundamental nature, as determined by the 
     appropriate officer of the Department.
       (3) Reduction.--The Secretary may reduce or eliminate the 
     requirement of paragraph (1) for a research and development 
     activity of an applied nature if the Secretary determines 
     that the reduction is necessary and appropriate.
       (c) Demonstration and Commercial Application.--
       (1) In general.--Except as provided in paragraph (2) and 
     subsection (f), the Secretary shall require that not less 
     than 50 percent of the cost of a demonstration or commercial 
     application activity described in subsection (a) to be 
     provided by a non-Federal source.
       (2) Reduction of non-federal share.--The Secretary may 
     reduce the non-Federal share required under paragraph (1) if 
     the Secretary determines the reduction to be necessary and 
     appropriate, taking into consideration any technological risk 
     relating to the activity.
       (d) Calculation of Amount.--In calculating the amount of a 
     non-Federal contribution under this section, the Secretary--
       (1) may include allowable costs in accordance with the 
     applicable cost principles, including--
       (A) cash;
       (B) personnel costs;
       (C) the value of a service, other resource, or third party 
     in-kind contribution determined in accordance with the 
     applicable circular of the Office of Management and Budget;
       (D) indirect costs or facilities and administrative costs; 
     or
       (E) any funds received under the power program of the 
     Tennessee Valley Authority (except to the extent that such 
     funds are made available under an annual appropriation Acts); 
     and
       (2) shall not include--
       (A) revenues or royalties from the prospective operation of 
     an activity beyond the time considered in the award;
       (B) proceeds from the prospective sale of an asset of an 
     activity; or
       (C) other appropriated Federal funds.
       (e) Repayment of Federal Share.--The Secretary shall not 
     require repayment of the Federal share of a cost-shared 
     activity under this section as a condition of making an 
     award.
       (f) Exclusions.--This section shall not apply to--
       (1) a cooperative research and development agreement under 
     the Stevenson-Wydler Technology Innovation Act of 1980 (15 
     U.S.C. 3701 et seq.);
       (2) a fee charged for the use of a Department facility; or
       (3) an award under--
       (A) the small business innovation research program under 
     section 9 of the Small Business Act (15 U.S.C. 638); or
       (B) the small business technology transfer program under 
     that section.

     SEC. 989. MERIT REVIEW OF PROPOSALS.

       (a) Awards.--Awards of funds authorized under this Act or 
     an amendment made by this Act shall be made only after an 
     impartial review of the scientific and technical merit of the 
     proposals for the awards has been carried out by or for the 
     Department.
       (b) Competition.--Competitive awards under this Act shall 
     involve competitions open to all qualified entities within 1 
     or more of the following categories:
       (1) Institutions of higher education.
       (2) National Laboratories.
       (3) Nonprofit and for-profit private entities.
       (4) State and local governments.
       (5) Consortia of entities described in paragraphs (1) 
     through (4).
       (c) Sense of Congress.--It is the sense of Congress that 
     research, development, demonstration, and commercial 
     application activities carried out by the Department should 
     be awarded using competitive procedures, to the maximum 
     extent practicable.

     SEC. 990. EXTERNAL TECHNICAL REVIEW OF DEPARTMENTAL PROGRAMS.

       (a) National Energy Research and Development Advisory 
     Boards.--
       (1) Establishment.--The Secretary shall establish 1 or more 
     advisory boards to review research, development, 
     demonstration, and commercial application programs of the 
     Department in energy efficiency, renewable energy, nuclear 
     energy, and fossil energy.
       (2) Alternatives.--The Secretary may--
       (A) designate an existing advisory board within the 
     Department to fulfill the responsibilities of an advisory 
     board under this section; and
       (B) enter into appropriate arrangements with the National 
     Academy of Sciences to establish such an advisory board.
       (b) Use of Existing Committees.--The Secretary shall 
     continue to use the scientific program advisory committees 
     chartered under the Federal Advisory Committee Act (5 U.S.C. 
     App.) by the Office of Science to oversee research and 
     development programs under that Office.
       (c) Membership.--Each advisory board under this section 
     shall consist of persons with appropriate expertise 
     representing a diverse range of interests.
       (d) Meetings and Goals.--
       (1) Meetings.--Each advisory board under this section shall 
     meet at least semiannually to review and advise on the 
     progress made by the respective 1 or more research, 
     development, demonstration, and commercial application 
     programs.
       (2) Goals.--The advisory board shall review the measurable 
     cost and performance-based goals for the programs as 
     established under section 902, and the progress on meeting 
     the goals.
       (e) Periodic Reviews and Assessments.--
       (1) In general.--The Secretary shall enter into appropriate 
     arrangements with the National Academy of Sciences to conduct 
     periodic reviews and assessments of--
       (A) the research, development, demonstration, and 
     commercial application programs authorized by this Act and 
     amendments made by this Act;
       (B) the measurable cost and performance-based goals for the 
     programs as established under section 902, if any; and
       (C) the progress on meeting the goals.
       (2) Timing.--The reviews and assessments shall be conducted 
     every 5 years or more often as the Secretary considers 
     necessary.
       (3) Reports.--The Secretary shall submit to Congress 
     reports describing the results of all the reviews and 
     assessments.

     SEC. 991. NATIONAL LABORATORY DESIGNATION.

       After the date of enactment of this Act, the Secretary 
     shall not designate a facility that is not listed in section 
     2(3) as a National Laboratory.

     SEC. 992. REPORT ON EQUAL EMPLOYMENT OPPORTUNITY PRACTICES.

       Not later than 12 months after the date of enactment of 
     this Act, and biennially thereafter, the Secretary shall 
     transmit to Congress a report on the equal employment 
     opportunity practices at National Laboratories. Such report 
     shall include--
       (1) a thorough review of each National Laboratory 
     contractor's equal employment opportunity policies, including 
     promotion to management and professional positions and pay 
     raises;
       (2) a statistical report on complaints and their 
     disposition in the National Laboratories;
       (3) a description of how equal employment opportunity 
     practices at the National Laboratories are treated in the 
     contract and in calculating award fees for each contractor;
       (4) a summary of disciplinary actions and their disposition 
     by either the Department or the relevant contractors for each 
     National Laboratory;
       (5) a summary of outreach efforts to attract women and 
     minorities to the National Laboratories;
       (6) a summary of efforts to retain women and minorities in 
     the National Laboratories; and
       (7) a summary of collaboration efforts with the Office of 
     Federal Contract Compliance Programs to improve equal 
     employment opportunity practices at the National 
     Laboratories.

     SEC. 993. STRATEGY AND PLAN FOR SCIENCE AND ENERGY FACILITIES 
                   AND INFRASTRUCTURE.

       (a) Facility and Infrastructure Policy.--
       (1) In general.--The Secretary shall develop and implement 
     a strategy for facilities and infrastructure supported 
     primarily from the Office of Science, the Office of Energy 
     Efficiency and Renewable Energy, the Office of Fossil Energy, 
     or the Office of Nuclear Energy, Science and Technology 
     Programs at all National Laboratories and single-purpose 
     research facilities.
       (2) Strategy.--The strategy shall provide cost-effective 
     means for--
       (A) maintaining existing facilities and infrastructure;
       (B) closing unneeded facilities;
       (C) making facility modifications; and
       (D) building new facilities.
       (b) Report.--
       (1) In general.--The Secretary shall prepare and submit, 
     along with the budget request of the President submitted to 
     Congress for fiscal year 2008, a report describing the 
     strategy developed under subsection (a).
       (2) Contents.--For each National Laboratory and single-
     purpose research facility that is primarily used for science 
     and energy research, the report shall contain--
       (A) the current priority list of proposed facilities and 
     infrastructure projects, including cost and schedule 
     requirements;
       (B) a current 10-year plan that demonstrates the 
     reconfiguration of its facilities and infrastructure to meet 
     its missions and to address its long-term operational costs 
     and return on investment;
       (C) the total current budget for all facilities and 
     infrastructure funding; and
       (D) the current status of each facility and infrastructure 
     project compared to the original baseline cost, schedule, and 
     scope.

     SEC. 994. STRATEGIC RESEARCH PORTFOLIO ANALYSIS AND 
                   COORDINATION PLAN.

       (a) In General.--The Secretary shall periodically review 
     all of the science and technology activities of the 
     Department in a strategic

[[Page 17881]]

     framework that takes into account both the frontiers of 
     science to which the Department can contribute and the 
     national needs relevant to the Department's statutory 
     missions.
       (b) Coordination Analysis and Plan.--As part of the review 
     under subsection (a), the Secretary shall develop a 
     coordination plan to improve coordination and collaboration 
     in research, development, demonstration, and commercial 
     application activities across Department organizational 
     boundaries.
       (c) Plan Contents.--The plan shall describe--
       (1) cross-cutting scientific and technical issues and 
     research questions that span more than 1 program or major 
     office of the Department;
       (2) how the applied technology programs of the Department 
     are coordinating their activities, and addressing those 
     questions;
       (3) ways in which the technical interchange within the 
     Department, particularly between the Office of Science and 
     the applied technology programs, can be enhanced, including 
     ways in which the research agendas of the Office of Science 
     and the applied programs can interact and assist each other;
       (4) a description of how the Secretary will ensure that the 
     Department's overall research agenda include, in addition to 
     fundamental, curiosity-driven research, fundamental research 
     related to topics of concern to the applied programs, and 
     applications in Departmental technology programs of research 
     results generated by fundamental, curiosity-driven research.
       (d) Plan Transmittal.--Not later than 12 months after the 
     date of enactment of this Act, and every 4 years thereafter, 
     the Secretary shall transmit to Congress the results of the 
     review under subsection (a) and the coordination plan under 
     subsection (b).

     SEC. 995. COMPETITIVE AWARD OF MANAGEMENT CONTRACTS.

       None of the funds authorized to be appropriated to the 
     Secretary by this title may be used to award a management and 
     operating contract for a National Laboratory (excluding those 
     named in subparagraphs (G), (H), (N), and (O) of section 2 
     (3)), unless such contract is competitively awarded, or the 
     Secretary grants, on a case-by-case basis, a waiver. The 
     Secretary may not delegate the authority to grant such a 
     waiver and shall submit to Congress a report notifying it of 
     the waiver, and setting forth the reasons for the waiver, at 
     least 60 days prior to the date of the award of such 
     contract.

     SEC. 996. WESTERN MICHIGAN DEMONSTRATION PROJECT.

       The Administrator of the Environmental Protection Agency, 
     in consultation with the State of Michigan and affected local 
     officials, shall conduct a demonstration project to address 
     the effect of transported ozone and ozone precursors in 
     Southwestern Michigan. The demonstration program shall 
     address projected nonattainment areas in Southwestern 
     Michigan that include counties with design values for ozone 
     of less than .095 based on years 2000 to 2002 or the most 
     current 3-year period of air quality data. The Administrator 
     shall assess any difficulties such areas may experience in 
     meeting the 8-hour national ambient air quality standard for 
     ozone due to the effect of transported ozone or ozone 
     precursors into the areas. The Administrator shall work with 
     State and local officials to determine the extent of ozone 
     and ozone precursor transport, to assess alternatives to 
     achieve compliance with the 8-hour standard apart from local 
     controls, and to determine the timeframe in which such 
     compliance could take place. The Administrator shall complete 
     this demonstration project no later than 2 years after the 
     date of enactment of this section and shall not impose any 
     requirement or sanction under the Clean Air Act (42 U.S.C. 
     7401 et seq.) that might otherwise apply during the pendency 
     of the demonstration project.

     SEC. 997. ARCTIC ENGINEERING RESEARCH CENTER.

       (a) In General.--The Secretary of Transportation, in 
     consultation with the Secretary and the United States Arctic 
     Research Commission, shall provide annual grants to a 
     university located adjacent to the Arctic Energy Office of 
     the Department of Energy, to establish and operate a 
     university research center to be headquartered in Fairbanks 
     and to be known as the ``Arctic Engineering Research Center'' 
     (referred to in this section as the ``Center'').
       (b) Purpose.--The purpose of the Center shall be to conduct 
     research on, and develop improved methods of, construction 
     and use of materials to improve the overall performance of 
     roads, bridges, residential, commercial, and industrial 
     structures, and other infrastructure in the Arctic region, 
     with an emphasis on developing--
       (1) new construction techniques for roads, bridges, rail, 
     and related transportation infrastructure and residential, 
     commercial, and industrial infrastructure that are capable of 
     withstanding the Arctic environment and using limited energy 
     resources as efficiently as practicable;
       (2) technologies and procedures for increasing road, 
     bridge, rail, and related transportation infrastructure and 
     residential, commercial, and industrial infrastructure 
     safety, reliability, and integrity in the Arctic region;
       (3) new materials and improving the performance and energy 
     efficiency of existing materials for the construction of 
     roads, bridges, rail, and related transportation 
     infrastructure and residential, commercial, and industrial 
     infrastructure in the Arctic region; and
       (4) recommendations for new local, regional, and State 
     permitting and building codes to ensure transportation and 
     building safety and efficient energy use when constructing, 
     using, and occupying such infrastructure in the Arctic 
     region.
       (c) Objectives.--The Center shall carry out--
       (1) basic and applied research in the subjects described in 
     subsection (b), the products of which shall be judged by 
     peers or other experts in the field to advance the body of 
     knowledge in road, bridge, rail, and infrastructure 
     engineering in the Arctic region; and
       (2) an ongoing program of technology transfer that makes 
     research results available to potential users in a form that 
     can be implemented.
       (d) Amount of Grant.--For each of fiscal years 2006 through 
     2011, the Secretary shall provide a grant in the amount of 
     $3,000,000 to the institution specified in subsection (a) to 
     carry out this section.
       (e) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section $3,000,000 for 
     each of fiscal years 2006 through 2011.

     SEC. 998. BARROW GEOPHYSICAL RESEARCH FACILITY.

       (a) Establishment.--The Secretary of Commerce, in 
     consultation with the Secretaries of Energy and the Interior, 
     the Director of the National Science Foundation, and the 
     Administrator of the Environmental Protection Agency, shall 
     establish a joint research facility in Barrow, Alaska, to be 
     known as the ``Barrow Geophysical Research Facility'', to 
     support scientific research activities in the Arctic.
       (b) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretaries of Commerce, Energy, 
     and the Interior, the Director of the National Science 
     Foundation, and the Administrator of the Environmental 
     Protection Agency for the planning, design, construction, and 
     support of the Barrow Geophysical Research Facility, 
     $61,000,000.
 Subtitle J--Ultra-Deepwater and Unconventional Natural Gas and Other 
                          Petroleum Resources

     SEC. 999A. PROGRAM AUTHORITY.

       (a) In General.--The Secretary shall carry out a program 
     under this subtitle of research, development, demonstration, 
     and commercial application of technologies for ultra-
     deepwater and unconventional natural gas and other petroleum 
     resource exploration and production, including addressing the 
     technology challenges for small producers, safe operations, 
     and environmental mitigation (including reduction of 
     greenhouse gas emissions and sequestration of carbon).
       (b) Program Elements.--The program under this subtitle 
     shall address the following areas, including improving safety 
     and minimizing environmental impacts of activities within 
     each area:
       (1) Ultra-deepwater architecture and technology, including 
     drilling to formations in the Outer Continental Shelf to 
     depths greater than 15,000 feet.
       (2) Unconventional natural gas and other petroleum resource 
     exploration and production technology.
       (3) The technology challenges of small producers.
       (4) Complementary research performed by the National Energy 
     Technology Laboratory for the Department.
       (c) Limitation on Location of Field Activities.--Field 
     activities under the program under this subtitle shall be 
     carried out only--
       (1) in--
       (A) areas in the territorial waters of the United States 
     not under any Outer Continental Shelf moratorium as of 
     September 30, 2002;
       (B) areas onshore in the United States on public land 
     administered by the Secretary of the Interior available for 
     oil and gas leasing, where consistent with applicable law and 
     land use plans; and
       (C) areas onshore in the United States on State or private 
     land, subject to applicable law; and
       (2) with the approval of the appropriate Federal or State 
     land management agency or private land owner.
       (d) Activities at the National Energy Technology 
     Laboratory.--The Secretary, through the National Energy 
     Technology Laboratory, shall carry out a program of research 
     and other activities complementary to and supportive of the 
     research programs under subsection (b).
       (e) Consultation With Secretary of the Interior.--In 
     carrying out this subtitle, the Secretary shall consult 
     regularly with the Secretary of the Interior.

     SEC. 999B. ULTRA-DEEPWATER AND UNCONVENTIONAL ONSHORE NATURAL 
                   GAS AND OTHER PETROLEUM RESEARCH AND 
                   DEVELOPMENT PROGRAM.

       (a) In General.--The Secretary shall carry out the 
     activities under section 999A, to maximize the value of 
     natural gas and other petroleum resources of the United 
     States, by increasing the supply of such resources, through 
     reducing the cost and increasing the efficiency of 
     exploration for and production of such resources, while 
     improving safety and minimizing environmental impacts.
       (b) Role of the Secretary.--The Secretary shall have 
     ultimate responsibility for, and oversight of, all aspects of 
     the program under this section.
       (c) Role of the Program Consortium.--
       (1) In general.--The Secretary shall contract with a 
     corporation that is structured as a consortium to administer 
     the programmatic activities outlined in this chapter. The 
     program consortium shall--

[[Page 17882]]

       (A) administer the program pursuant to subsection (f)(3), 
     utilizing program administration funds only ;
       (B) issue research project solicitations upon approval of 
     the Secretary or the Secretary's designee;
       (C) make project awards to research performers upon 
     approval of the Secretary or the Secretary's designee;
       (D) disburse research funds to research performers awarded 
     under subsection (f) as directed by the Secretary in 
     accordance with the annual plan under subsection (e); and
       (E) carry out other activities assigned to the program 
     consortium by this section.
       (2) Limitation.--The Secretary may not assign any 
     activities to the program consortium except as specifically 
     authorized under this section.
       (3) Conflict of interest.--
       (A) Procedures.--The Secretary shall establish procedures--
       (i) to ensure that each board member, officer, or employee 
     of the program consortium who is in a decisionmaking capacity 
     under subsection (f)(3) shall disclose to the Secretary any 
     financial interests in, or financial relationships with, 
     applicants for or recipients of awards under this section, 
     including those of his or her spouse or minor child, unless 
     such relationships or interests would be considered to be 
     remote or inconsequential; and
       (ii) to require any board member, officer, or employee with 
     a financial relationship or interest disclosed under clause 
     (i) to recuse himself or herself from any oversight under 
     subsection (f)(4) with respect to such applicant or 
     recipient.
       (B) Failure to comply.--The Secretary may disqualify an 
     application or revoke an award under this section if a board 
     member, officer, or employee has failed to comply with 
     procedures required under subparagraph (A)(ii).
       (d) Selection of the Program Consortium.--
       (1) In general.--The Secretary shall select the program 
     consortium through an open, competitive process.
       (2) Members.--The program consortium may include 
     corporations, trade associations, institutions of higher 
     education, National Laboratories, or other research 
     institutions. After submitting a proposal under paragraph 
     (4), the program consortium may not add members without the 
     consent of the Secretary.
       (3) Requirement of section 501(c)(3) status.--The Secretary 
     shall not select a consortium under this section unless such 
     consortium is an organization described in section 501(c)(3) 
     of the Internal Revenue Code of 1986 and exempt from tax 
     under such section 501(a) of such Code.
       (4) Schedule.--Not later than 90 days after the date of 
     enactment of this Act, the Secretary shall solicit proposals 
     from eligible consortia to perform the duties in subsection 
     (c)(1), which shall be submitted not later than 180 days 
     after the date of enactment of this Act. The Secretary shall 
     select the program consortium not later than 270 days after 
     such date of enactment.
       (5) Application.--Applicants shall submit a proposal 
     including such information as the Secretary may require. At a 
     minimum, each proposal shall--
       (A) list all members of the consortium;
       (B) fully describe the structure of the consortium, 
     including any provisions relating to intellectual property; 
     and
       (C) describe how the applicant would carry out the 
     activities of the program consortium under this section.
       (6) Eligibility.--To be eligible to be selected as the 
     program consortium, an applicant must be an entity whose 
     members have collectively demonstrated capabilities and 
     experience in planning and managing research, development, 
     demonstration, and commercial application programs for ultra-
     deepwater and unconventional natural gas or other petroleum 
     exploration or production.
       (7) Focus areas for awards.--
       (A) Ultra-deepwater resources.--Awards from allocations 
     under section 999H(d)(1) shall focus on the development and 
     demonstration of individual exploration and production 
     technologies as well as integrated systems technologies 
     including new architectures for production in ultra-
     deepwater.
       (B) Unconventional resources.--Awards from allocations 
     under section 999H(d)(2) shall focus on areas including 
     advanced coalbed methane, deep drilling, natural gas 
     production from tight sands, natural gas production from gas 
     shales, stranded gas, innovative exploration and production 
     techniques, enhanced recovery techniques, and environmental 
     mitigation of unconventional natural gas and other petroleum 
     resources exploration and production.
       (C) Small producers.--Awards from allocations under section 
     999H(d)(3) shall be made to consortia consisting of small 
     producers or organized primarily for the benefit of small 
     producers, and shall focus on areas including complex geology 
     involving rapid changes in the type and quality of the oil 
     and gas reservoirs across the reservoir; low reservoir 
     pressure; unconventional natural gas reservoirs in coalbeds, 
     deep reservoirs, tight sands, or shales; and unconventional 
     oil reservoirs in tar sands and oil shales.
       (e) Annual Plan.--
       (1) In general.--The program under this section shall be 
     carried out pursuant to an annual plan prepared by the 
     Secretary in accordance with paragraph (2).
       (2) Development.--
       (A) Solicitation of recommendations.--Before drafting an 
     annual plan under this subsection, the Secretary shall 
     solicit specific written recommendations from the program 
     consortium for each element to be addressed in the plan, 
     including those described in paragraph (4). The program 
     consortium shall submit its recommendations in the form of a 
     draft annual plan.
       (B) Submission of recommendations; other comment.--The 
     Secretary shall submit the recommendations of the program 
     consortium under subparagraph (A) to the Ultra-Deepwater 
     Advisory Committee established under section 999D(a) and to 
     the Unconventional Resources Technology Advisory Committee 
     established under section 999D(b), and such Advisory 
     Committees shall provide to the Secretary written comments by 
     a date determined by the Secretary. The Secretary may also 
     solicit comments from any other experts.
       (C) Consultation.--The Secretary shall consult regularly 
     with the program consortium throughout the preparation of the 
     annual plan.
       (3) Publication.--The Secretary shall transmit to Congress 
     and publish in the Federal Register the annual plan, along 
     with any written comments received under paragraph (2)(A) and 
     (B).
       (4) Contents.--The annual plan shall describe the ongoing 
     and prospective activities of the program under this section 
     and shall include--
       (A) a list of any solicitations for awards to carry out 
     research, development, demonstration, or commercial 
     application activities, including the topics for such work, 
     who would be eligible to apply, selection criteria, and the 
     duration of awards; and
       (B) a description of the activities expected of the program 
     consortium to carry out subsection (f)(3).
       (5) Estimates of increased royalty receipts.--The 
     Secretary, in consultation with the Secretary of the 
     Interior, shall provide an annual report to Congress with the 
     President's budget on the estimated cumulative increase in 
     Federal royalty receipts (if any) resulting from the 
     implementation of this subtitle. The initial report under 
     this paragraph shall be submitted in the first President's 
     budget following the completion of the first annual plan 
     required under this subsection.
       (f) Awards.--
       (1) In general.--Upon approval of the Secretary the program 
     consortium shall make awards to research performers to carry 
     out research, development, demonstration, and commercial 
     application activities under the program under this section. 
     The program consortium shall not be eligible to receive such 
     awards, but provided that conflict of interest procedures in 
     section 999B(c)(3) are followed, entities who are members of 
     the program consortium are not precluded from receiving 
     research awards as either individual research performers or 
     as research performers who are members of a research 
     collaboration.
       (2) Proposals.--Upon approval of the Secretary the program 
     consortium shall solicit proposals for awards under this 
     subsection in such manner and at such time as the Secretary 
     may prescribe, in consultation with the program consortium.
       (3) Oversight.--
       (A) In general.--The program consortium shall oversee the 
     implementation of awards under this subsection, consistent 
     with the annual plan under subsection (e), including 
     disbursing funds and monitoring activities carried out under 
     such awards for compliance with the terms and conditions of 
     the awards.
       (B) Effect.--Nothing in subparagraph (A) shall limit the 
     authority or responsibility of the Secretary to oversee 
     awards, or limit the authority of the Secretary to review or 
     revoke awards.
       (g) Administrative Costs.--
       (1) In general.--To compensate the program consortium for 
     carrying out its activities under this section, the Secretary 
     shall provide to the program consortium funds sufficient to 
     administer the program. This compensation may include a 
     management fee consistent with Department of Energy 
     contracting practices and procedures.
       (2) Advance.--The Secretary shall advance funds to the 
     program consortium upon selection of the consortium, which 
     shall be deducted from amounts to be provided under paragraph 
     (1).
       (h) Audit.--The Secretary shall retain an independent 
     auditor, which shall include a review by the General 
     Accountability Office, to determine the extent to which funds 
     provided to the program consortium, and funds provided under 
     awards made under subsection (f), have been expended in a 
     manner consistent with the purposes and requirements of this 
     subtitle. The auditor shall transmit a report (including any 
     review by the General Accountability Office) annually to the 
     Secretary, who shall transmit the report to Congress, along 
     with a plan to remedy any deficiencies cited in the report.
       (i) Activities by the United States Geological Survey.--The 
     Secretary of the Interior, through the United States 
     Geological Survey, shall, where appropriate, carry out 
     programs of long-term research to complement the programs 
     under this section.
       (j) Program Review and Oversight.--The National Energy 
     Technology Laboratory, on behalf of the Secretary, shall (1) 
     issue a competitive solicitation for the program consortium, 
     (2) evaluate, select, and award a contract or other agreement 
     to a qualified program consortium, and (3) have primary 
     review and oversight responsibility for the program 
     consortium, including review and approval of research awards 
     proposed to be made by the program consortium, to

[[Page 17883]]

     ensure that its activities are consistent with the purposes 
     and requirements described in this subtitle. Up to 5 percent 
     of program funds allocated under paragraphs (1) through (3) 
     of section 999H(d) may be used for this purpose, including 
     program direction and the establishment of a site office if 
     determined to be necessary to carry out the purposes of this 
     subsection.

     SEC. 999C. ADDITIONAL REQUIREMENTS FOR AWARDS.

       (a) Demonstration Projects.--An application for an award 
     under this subtitle for a demonstration project shall 
     describe with specificity the intended commercial use of the 
     technology to be demonstrated.
       (b) Flexibility in Locating Demonstration Projects.--
     Subject to the limitation in section 999A(c), a demonstration 
     project under this subtitle relating to an ultra-deepwater 
     technology or an ultra-deepwater architecture may be 
     conducted in deepwater depths.
       (c) Intellectual Property Agreements.--If an award under 
     this subtitle is made to a consortium (other than the program 
     consortium), the consortium shall provide to the Secretary a 
     signed contract agreed to by all members of the consortium 
     describing the rights of each member to intellectual property 
     used or developed under the award.
       (d) Technology Transfer.--2.5 percent of the amount of each 
     award made under this subtitle shall be designated for 
     technology transfer and outreach activities under this 
     subtitle.
       (e) Cost Sharing Reduction for Independent Producers.--In 
     applying the cost sharing requirements under section 988 to 
     an award under this subtitle the Secretary may reduce or 
     eliminate the non-Federal requirement if the Secretary 
     determines that the reduction is necessary and appropriate 
     considering the technological risks involved in the project.
       (f) Information Sharing.--All results of the research 
     administered by the program consortium shall be made 
     available to the public consistent with Department policy and 
     practice on information sharing and intellectual property 
     agreements.

     SEC. 999D. ADVISORY COMMITTEES.

       (a) Ultra-Deepwater Advisory Committee.--
       (1) Establishment.--Not later than 270 days after the date 
     of enactment of this Act, the Secretary shall establish an 
     advisory committee to be known as the Ultra-Deepwater 
     Advisory Committee.
       (2) Membership.--The Advisory Committee under this 
     subsection shall be composed of members appointed by the 
     Secretary, including--
       (A) individuals with extensive research experience or 
     operational knowledge of offshore natural gas and other 
     petroleum exploration and production;
       (B) individuals broadly representative of the affected 
     interests in ultra-deepwater natural gas and other petroleum 
     production, including interests in environmental protection 
     and safe operations;
       (C) no individuals who are Federal employees; and
       (D) no individuals who are board members, officers, or 
     employees of the program consortium.
       (3) Duties.--The Advisory Committee under this subsection 
     shall--
       (A) advise the Secretary on the development and 
     implementation of programs under this subtitle related to 
     ultra-deepwater natural gas and other petroleum resources; 
     and
       (B) carry out section 999B(e)(2)(B).
       (4) Compensation.--A member of the Advisory Committee under 
     this subsection shall serve without compensation but shall 
     receive travel expenses in accordance with applicable 
     provisions under subchapter I of chapter 57 of title 5, 
     United States Code.
       (b) Unconventional Resources Technology Advisory 
     Committee.--
       (1) Establishment.--Not later than 270 days after the date 
     of enactment of this Act, the Secretary shall establish an 
     advisory committee to be known as the Unconventional 
     Resources Technology Advisory Committee.
       (2) Membership.--The Secretary shall endeavor to have a 
     balanced representation of members on the Advisory Committee 
     to reflect the breadth of geographic areas of potential gas 
     supply. The Advisory Committee under this subsection shall be 
     composed of members appointed by the Secretary, including--
       (A) a majority of members who are employees or 
     representatives of independent producers of natural gas and 
     other petroleum, including small producers;
       (B) individuals with extensive research experience or 
     operational knowledge of unconventional natural gas and other 
     petroleum resource exploration and production;
       (C) individuals broadly representative of the affected 
     interests in unconventional natural gas and other petroleum 
     resource exploration and production, including interests in 
     environmental protection and safe operations;
       (D) individuals with expertise in the various geographic 
     areas of potential supply of unconventional onshore natural 
     gas and other petroleum in the United States;
       (E) no individuals who are Federal employees; and
       (F) no individuals who are board members, officers, or 
     employees of the program consortium.
       (3) Duties.--The Advisory Committee under this subsection 
     shall--
       (A) advise the Secretary on the development and 
     implementation of activities under this subtitle related to 
     unconventional natural gas and other petroleum resources; and
       (B) carry out section 999B(e)(2)(B).
       (4) Compensation.--A member of the Advisory Committee under 
     this subsection shall serve without compensation but shall 
     receive travel expenses in accordance with applicable 
     provisions under subchapter I of chapter 57 of title 5, 
     United States Code.
       (c) Prohibition.--No advisory committee established under 
     this section shall make recommendations on funding awards to 
     particular consortia or other entities, or for specific 
     projects.

     SEC. 999E. LIMITS ON PARTICIPATION.

       An entity shall be eligible to receive an award under this 
     subtitle only if the Secretary finds--
       (1) that the entity's participation in the program under 
     this subtitle would be in the economic interest of the United 
     States; and
       (2) that either--
       (A) the entity is a United States-owned entity organized 
     under the laws of the United States; or
       (B) the entity is organized under the laws of the United 
     States and has a parent entity organized under the laws of a 
     country that affords--
       (i) to United States-owned entities opportunities, 
     comparable to those afforded to any other entity, to 
     participate in any cooperative research venture similar to 
     those authorized under this subtitle;
       (ii) to United States-owned entities local investment 
     opportunities comparable to those afforded to any other 
     entity; and
       (iii) adequate and effective protection for the 
     intellectual property rights of United States-owned entities.

     SEC. 999F. SUNSET.

       The authority provided by this subtitle shall terminate on 
     September 30, 2014.

     SEC. 999G. DEFINITIONS.

       In this subtitle:
       (1) Deepwater.--The term ``deepwater'' means a water depth 
     that is greater than 200 but less than 1,500 meters.
       (2) Independent producer of oil or gas.--
       (A) In general.--The term ``independent producer of oil or 
     gas'' means any person that produces oil or gas other than a 
     person to whom subsection (c) of section 613A of the Internal 
     Revenue Code of 1986 does not apply by reason of paragraph 
     (2) (relating to certain retailers) or paragraph (4) 
     (relating to certain refiners) of section 613A(d) of such 
     Code.
       (B) Rules for applying paragraphs (2) and (4) of section 
     613a(d).--For purposes of subparagraph (A), paragraphs (2) 
     and (4) of section 613A(d) of the Internal Revenue Code of 
     1986 shall be applied by substituting ``calendar year'' for 
     ``taxable year'' each place it appears in such paragraphs.
       (3) Program administration funds.--The term ``program 
     administration funds'' means funds used by the program 
     consortium to administer the program under this subtitle, but 
     not to exceed 10 percent of the total funds allocated under 
     paragraphs (1) through (3) of section 999H(d).
       (4) Program consortium.--The term ``program consortium'' 
     means the consortium selected under section 999B(d).
       (5) Program research funds.--The term ``program research 
     funds'' means funds awarded to research performers by the 
     program consortium consistent with the annual plan.
       (6) Remote or inconsequential.--The term ``remote or 
     inconsequential'' has the meaning given that term in 
     regulations issued by the Office of Government Ethics under 
     section 208(b)(2) of title 18, United States Code.
       (7) Small producer.--The term ``small producer'' means an 
     entity organized under the laws of the United States with 
     production levels of less than 1,000 barrels per day of oil 
     equivalent.
       (8) Ultra-deepwater.--The term ``ultra-deepwater'' means a 
     water depth that is equal to or greater than 1,500 meters.
       (9) Ultra-deepwater architecture.--The term ``ultra-
     deepwater architecture'' means the integration of 
     technologies for the exploration for, or production of, 
     natural gas or other petroleum resources located at ultra-
     deepwater depths.
       (10) Ultra-deepwater technology.--The term ``ultra-
     deepwater technology'' means a discrete technology that is 
     specially suited to address 1 or more challenges associated 
     with the exploration for, or production of, natural gas or 
     other petroleum resources located at ultra-deepwater depths.
       (11) Unconventional natural gas and other petroleum 
     resource.--The term ``unconventional natural gas and other 
     petroleum resource'' means natural gas and other petroleum 
     resource located onshore in an economically inaccessible 
     geological formation, including resources of small producers.

     SEC. 999H. FUNDING.

       (a) Oil and Gas Lease Income.--For each of fiscal years 
     2007 through 2017, from any Federal royalties, rents, and 
     bonuses derived from Federal onshore and offshore oil and gas 
     leases issued under the Outer Continental Shelf Lands Act (43 
     U.S.C. 1331 et seq.) and the Mineral Leasing Act (30 U.S.C. 
     181 et seq.) which are deposited in the Treasury, and after 
     distribution of any such funds as described in subsection 
     (c), $50,000,000 shall be deposited into the Ultra-Deepwater 
     and Unconventional Natural Gas and Other Petroleum Research 
     Fund (in this section referred to as the ``Fund''). For 
     purposes of this section, the term ``royalties'' excludes 
     proceeds from the sale of royalty production taken in kind 
     and royalty production that is transferred under section 
     27(a)(3) of the Outer Continental Shelf Lands Act (43 U.S.C. 
     1353(a)(3)).

[[Page 17884]]

       (b) Obligational Authority.--Monies in the Fund shall be 
     available to the Secretary for obligation under this part 
     without fiscal year limitation, to remain available until 
     expended.
       (c) Prior Distributions.--The distributions described in 
     subsection (a) are those required by law--
       (1) to States and to the Reclamation Fund under the Mineral 
     Leasing Act (30 U.S.C. 191(a)); and
       (2) to other funds receiving monies from Federal oil and 
     gas leasing programs, including--
       (A) any recipients pursuant to section 8(g) of the Outer 
     Continental Shelf Lands Act (43 U.S.C. 1337(g));
       (B) the Land and Water Conservation Fund, pursuant to 
     section 2(c) of the Land and Water Conservation Fund Act of 
     1965 (16 U.S.C. 4601-5(c));
       (C) the Historic Preservation Fund, pursuant to section 108 
     of the National Historic Preservation Act (16 U.S.C. 470h); 
     and
       (D) the coastal impact assistance program established under 
     section 31 of the Outer Continental Shelf Lands Act (as 
     amended by section 384).
       (d) Allocation.--Amounts obligated from the Fund under 
     subsection (a)(1) in each fiscal year shall be allocated as 
     follows:
       (1) 35 percent shall be for activities under section 
     999A(b)(1).
       (2) 32.5 percent shall be for activities under section 
     999A(b)(2).
       (3) 7.5 percent shall be for activities under section 
     999A(b)(3).
       (4) 25 percent shall be for complementary research under 
     section 999A(b)(4) and other activities under section 999A(b) 
     to include program direction funds, overall program 
     oversight, contract management, and the establishment and 
     operation of a technical committee to ensure that in-house 
     research activities funded under section 999A(b)(4) are 
     technically complementary to, and not duplicative of, 
     research conducted under paragraphs (1), (2), and (3) of 
     section 999A(b).
       (e) Authorization of Appropriations.--In addition to other 
     amounts that are made available to carry out this section, 
     there is authorized to be appropriated to carry out this 
     section $100,000,000 for each of fiscal years 2007 through 
     2016.
       (f) Fund.--There is hereby established in the Treasury of 
     the United States a separate fund to be known as the ``Ultra-
     Deepwater and Unconventional Natural Gas and Other Petroleum 
     Research Fund''.
                TITLE X--DEPARTMENT OF ENERGY MANAGEMENT

     SEC. 1001. IMPROVED TECHNOLOGY TRANSFER OF ENERGY 
                   TECHNOLOGIES.

       (a) Technology Transfer Coordinator.--The Secretary shall 
     appoint a Technology Transfer Coordinator to be the principal 
     advisor to the Secretary on all matters relating to 
     technology transfer and commercialization.
       (b) Qualifications.--The Coordinator shall be an individual 
     who, by reason of professional background and experience, is 
     specially qualified to advise the Secretary on matters 
     pertaining to technology transfer at the Department.
       (c) Duties of the Coordinator.--The Coordinator shall 
     oversee--
       (1) the activities of the Technology Transfer Working Group 
     established under subsection (d);
       (2) the expenditure of funds allocated for technology 
     transfer within the Department;
       (3) the activities of each technology partnership ombudsman 
     appointed under section 11 of the Technology Transfer 
     Commercialization Act of 2000 (42 U.S.C. 7261c); and
       (4) efforts to engage private sector entities, including 
     venture capital companies.
       (d) Technology Transfer Working Group.--The Secretary shall 
     establish a Technology Transfer Working Group, which shall 
     consist of representatives of the National Laboratories and 
     single-purpose research facilities, to--
       (1) coordinate technology transfer activities occurring at 
     National Laboratories and single-purpose research facilities;
       (2) exchange information about technology transfer 
     practices, including alternative approaches to resolution of 
     disputes involving intellectual property rights and other 
     technology transfer matters; and
       (3) develop and disseminate to the public and prospective 
     technology partners information about opportunities and 
     procedures for technology transfer with the Department, 
     including opportunities and procedures related to alternative 
     approaches to resolution of disputes involving intellectual 
     property rights and other technology transfer matters.
       (e) Technology Commercialization Fund.--The Secretary shall 
     establish an Energy Technology Commercialization Fund, using 
     0.9 percent of the amount made available to the Department 
     for applied energy research, development, demonstration, and 
     commercial application for each fiscal year, to be used to 
     provide matching funds with private partners to promote 
     promising energy technologies for commercial purposes.
       (f) Technology Transfer Responsibility.--Nothing in this 
     section affects the technology transfer responsibilities of 
     Federal employees under the Stevenson-Wydler Technology 
     Innovation Act of 1980 (15 U.S.C. 3701 et seq.).
       (g) Planning and Reporting.--
       (1) In general.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     a technology transfer execution plan.
       (2) Updates.--Each year after the submission of the plan 
     under paragraph (1), the Secretary shall submit to Congress 
     an updated execution plan and reports that describe progress 
     toward meeting goals set forth in the execution plan and the 
     funds expended under subsection (e).

     SEC. 1002. TECHNOLOGY INFRASTRUCTURE PROGRAM.

       (a) Definitions.--In this section:
       (1) Program.--The term ``Program'' means the Technology 
     Infrastructure Program established under subsection (b).
       (2) Technology cluster.--The term ``technology cluster'' 
     means a concentration of technology-related business 
     concerns, institutions of higher education, or nonprofit 
     institutions, that reinforce each other's performance in the 
     areas of technology development through formal or informal 
     relationships.
       (3) Technology-related business concern.--The term 
     ``technology-related business concern'' means a for-profit 
     corporation, company, association, firm, partnership, or 
     small business concern that--
       (A) conducts scientific or engineering research;
       (B) develops new technologies;
       (C) manufactures products based on new technologies; or
       (D) performs technological services.
       (b) Establishment.--The Secretary shall establish a 
     Technology Infrastructure Program in accordance with this 
     section.
       (c) Purpose.--The purpose of the Program shall be to 
     improve the ability of National Laboratories and single-
     purpose research facilities to support departmental missions 
     by--
       (1) stimulating the development of technology clusters that 
     can support departmental missions at the National 
     Laboratories or single-purpose research facilities;
       (2) improving the ability of National Laboratories and 
     single-purpose research facilities to leverage and benefit 
     from commercial research, technology, products, processes, 
     and services; and
       (3) encouraging the exchange of scientific and 
     technological expertise between--
       (A) National Laboratories or single-purpose research 
     facilities; and
       (B) entities that can support departmental missions at the 
     National Laboratories or single-purpose research facilities, 
     such as--
       (i) institutions of higher education;
       (ii) technology-related business concerns;
       (iii) nonprofit institutions; and
       (iv) agencies of State, tribal, or local governments.
       (d) Projects.--The Secretary shall authorize the director 
     of each National Laboratory or single-purpose research 
     facility to implement the Program at the National Laboratory 
     or facility through 1 or more projects that meet the 
     requirements of subsections (e) and (f).
       (e) Program Requirements.--
       (1) In general.--Each project funded under this section 
     shall meet the requirements of this subsection.
       (2) Entities.--Each project shall include at least 1 of 
     each of the following entities:
       (A) A business.
       (B) An institution of higher education.
       (C) A nonprofit institution.
       (D) An agency of a State, local, or tribal government.
       (3) Cost-sharing.--
       (A) In general.--The costs of carrying out projects under 
     this section shall be shared in accordance with section 988.
       (B) Sources.--The calculation of costs paid by the non-
     Federal sources for a project shall include cash, personnel, 
     services, equipment, and other resources expended on the 
     project after the commencement of the project.
       (C) Research and development expenses.--Independent 
     research and development expenses of Government contractors 
     that qualify for reimbursement under section 31.205-18(e) of 
     title 48, Code of Federal Regulations, issued pursuant to 
     section 25(c)(1) of the Office of Federal Procurement Policy 
     Act (41 U.S.C. 421(c)(1)), may be credited towards costs paid 
     by non-Federal sources to a project, if the expenses meet the 
     other requirements of this section.
       (4) Competitive selection.--A project under this section 
     shall be competitively selected using procedures determined 
     by the Secretary.
       (5) Accounting.--Any participant that receives funds under 
     this section may use generally accepted accounting principles 
     for maintaining accounts, books, and records relating to the 
     project.
       (6) Duration.--No Federal funds shall be made available 
     under this section for a construction project or for any 
     project with a duration of more than 5 years.
       (f) Selection Criteria.--
       (1) Departmental missions.--The Secretary shall allocate 
     funds under this section only if the Director of the National 
     Laboratory or single-purpose research facility managing the 
     project determines that the project is likely to improve the 
     ability of the National Laboratory or single-purpose research 
     facility to achieve technical success in meeting departmental 
     missions.
       (2) Other criteria.--In selecting a project to receive 
     Federal funds, the Secretary shall consider--
       (A) the potential of the project to promote the development 
     of a commercially sustainable technology cluster following 
     the period of investment by the Department, which will derive 
     most of the demand for its products or services from the 
     private sector, and which will support departmental missions 
     at the participating National Laboratory or single-purpose 
     research facility;

[[Page 17885]]

       (B) the potential of the project to promote the use of 
     commercial research, technology, products, processes, and 
     services by the participating National Laboratory or single-
     purpose research facility to achieve its mission or the 
     commercial development of technological innovations made at 
     the participating National Laboratory or single-purpose 
     research facility;
       (C) the extent to which the project involves a wide variety 
     and number of institutions of higher education, nonprofit 
     institutions, and technology-related business concerns that 
     can support the missions of the participating National 
     Laboratory or single-purpose research facility and that will 
     make substantive contributions to achieving the goals of the 
     project;
       (D) the extent to which the project focuses on promoting 
     the development of technology-related business concerns that 
     are small businesses or involves such small businesses 
     substantively in the project; and
       (E) such other criteria as the Secretary determines to be 
     appropriate.
       (g) Allocation.--In allocating funds for projects approved 
     under this section, the Secretary shall provide--
       (1) the Federal share of the project costs; and
       (2) additional funds to the National Laboratory or single-
     purpose research facility managing the project to permit the 
     National Laboratory or single-purpose research facility to 
     carry out activities relating to the project, and to 
     coordinate the activities with the project.
       (h) Report to Congress.--Not later than July 1, 2008, the 
     Secretary shall submit to Congress a report on whether the 
     Program should be continued and, if so, how the program 
     should be managed.
       (i) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary for activities under this 
     section $10,000,000 for each of fiscal years 2006 through 
     2008.

     SEC. 1003. SMALL BUSINESS ADVOCACY AND ASSISTANCE.

       (a) Small Business Advocate.--The Secretary shall require 
     the Director of each National Laboratory, and may require the 
     Director of a single-purpose research facility, to designate 
     a small business advocate to--
       (1) increase the participation of small business concerns, 
     including socially and economically disadvantaged small 
     business concerns (as defined in section 8(a)(4) of the Small 
     Business Act (15 U.S.C. 637(a)(4))), in procurement, 
     collaborative research, technology licensing, and technology 
     transfer activities conducted by the National Laboratory or 
     single-purpose research facility;
       (2) report to the Director of the National Laboratory or 
     single-purpose research facility on the actual participation 
     of small business concerns in procurement and collaborative 
     research along with recommendations, if appropriate, on how 
     to improve participation;
       (3) make available to small business concerns training, 
     mentoring, and information on how to participate in 
     procurement and collaborative research activities;
       (4) increase the awareness inside the National Laboratory 
     or single-purpose research facility of the capabilities and 
     opportunities presented by small business concerns; and
       (5) establish guidelines for the program under subsection 
     (b) and report on the effectiveness of the program to the 
     Director of the National Laboratory or single-purpose 
     research facility.
       (b) Establishment of Small Business Assistance Program.--
     The Secretary shall require the Director of each National 
     Laboratory, and may require the Director of a single-purpose 
     research facility, to establish a program to provide small 
     business concerns with--
       (1) assistance directed at making the small business 
     concerns more effective and efficient subcontractors or 
     suppliers to the National Laboratory or single-purpose 
     research facilities; or
       (2) general technical assistance, the cost of which shall 
     not exceed $10,000 per instance of assistance, to improve the 
     products or services of the small business concern.
       (c) Use of Funds.--None of the funds expended under 
     subsection (b) may be used for direct grants to small 
     business concerns.
       (d) Authorization of Appropriations.--There is authorized 
     to be appropriated to the Secretary for activities under this 
     section $5,000,000 for each of fiscal years 2006 through 
     2008.

     SEC. 1004. OUTREACH.

       The Secretary shall ensure that each program authorized by 
     this Act or an amendment made by this Act includes an 
     outreach component to provide information, as appropriate, to 
     manufacturers, consumers, engineers, architects, builders, 
     energy service companies, institutions of higher education, 
     facility planners and managers, State and local governments, 
     and other entities.

     SEC. 1005. RELATIONSHIP TO OTHER LAWS.

       Except as otherwise provided in this Act or an amendment 
     made by this Act, the Secretary shall carry out the research, 
     development, demonstration, and commercial application 
     programs, projects, and activities authorized by this Act or 
     an amendment made by this Act in accordance with the 
     applicable provisions of--
       (1) the Atomic Energy Act of 1954 (42 U.S.C. 2011 et seq.);
       (2) the Federal Nonnuclear Energy Research and Development 
     Act of 1974 (42 U.S.C. 5901 et seq.);
       (3) the Energy Policy Act of 1992 (42 U.S.C. 13201 et 
     seq.);
       (4) the Stevenson-Wydler Technology Innovation Act of 1980 
     (15 U.S.C. 3701 et seq.);
       (5) chapter 18 of title 35, United States Code (commonly 
     known as the ``Bayh-Dole Act''); and
       (6) any other Act under which the Secretary is authorized 
     to carry out the programs, projects, and activities.

     SEC. 1006. IMPROVED COORDINATION AND MANAGEMENT OF CIVILIAN 
                   SCIENCE AND TECHNOLOGY PROGRAMS.

       (a) Effective Top-Level Coordination of Research and 
     Development Programs.--Section 202 of the Department of 
     Energy Organization Act (42 U.S.C. 7132) is amended by 
     striking subsection (b) and inserting the following:
       ``(b)(1) There shall be in the Department an Under 
     Secretary for Science, who shall be appointed by the 
     President, by and with the advice and consent of the Senate.
       ``(2) The Under Secretary shall be compensated at the rate 
     provided for level III of the Executive Schedule under 
     section 5314 of title 5, United States Code.
       ``(3) The Under Secretary for Science shall be appointed 
     from among persons who--
       ``(A) have extensive background in scientific or 
     engineering fields; and
       ``(B) are well qualified to manage the civilian research 
     and development programs of the Department.
       ``(4) The Under Secretary for Science shall--
       ``(A) serve as the Science and Technology Advisor to the 
     Secretary;
       ``(B) monitor the research and development programs of the 
     Department in order to advise the Secretary with respect to 
     any undesirable duplication or gaps in the programs;
       ``(C) advise the Secretary with respect to the well-being 
     and management of the multipurpose laboratories under the 
     jurisdiction of the Department;
       ``(D) advise the Secretary with respect to education and 
     training activities required for effective short- and long-
     term basic and applied research activities of the Department;
       ``(E) advise the Secretary with respect to grants and other 
     forms of financial assistance required for effective short- 
     and long-term basic and applied research activities of the 
     Department;
       ``(F) advise the Secretary with respect to long-term 
     planning, coordination, and development of a strategic 
     framework for Department research and development activities; 
     and
       ``(G) carry out such additional duties assigned to the 
     Under Secretary by the Secretary relating to basic and 
     applied research, including supervision or support of 
     research activities carried out by any of the Assistant 
     Secretaries designated by section 203 of this Act, as the 
     Secretary considers advantageous.''.
       (b) Additional Assistant Secretary Position.--
       (1) In general.--Section 203(a) of the Department of Energy 
     Organization Act (42 U.S.C. 7133(a)) is amended in the first 
     sentence by striking ``six Assistant Secretaries'' and 
     inserting ``7 Assistant Secretaries''.
       (2) Assistant secretary level.--It is the sense of Congress 
     that the leadership for departmental missions in nuclear 
     energy should be at the Assistant Secretary level.
       (c) Technical and Conforming Amendments.--
       (1) Section 202 of the Department of Energy Organization 
     Act (42 U.S.C. 7132) is amended by adding at the end the 
     following:
       ``(d)(1) There shall be in the Department an Under 
     Secretary, who shall be appointed by the President, by and 
     with the advice and consent of the Senate, and who shall 
     perform such functions and duties as the Secretary shall 
     prescribe, consistent with this section.
       ``(2) The Under Secretary shall be compensated at the rate 
     provided for level III of the Executive Schedule under 
     section 5314 of title 5, United States Code.
       ``(e)(1) There shall be in the Department a General 
     Counsel, who shall be appointed by the President, by and with 
     the advice and consent of the Senate, and who shall perform 
     such functions and duties as the Secretary shall prescribe.
       ``(2) The General Counsel shall be compensated at the rate 
     provided for level IV of the Executive Schedule under section 
     5315 of title 5, United States Code.''.
       (2) Section 5314 of title 5, United States Code, is amended 
     by striking ``Under Secretaries of Energy (2)'' and inserting 
     ``Under Secretaries of Energy (3)''.
       (3) Section 5315 of title 5, United States Code, is amended 
     by striking ``Assistant Secretaries of Energy (6)'' and 
     inserting ``Assistant Secretaries of Energy (7)''.
       (4) Section 209(b) of the Department of Energy Organization 
     Act (42 U.S.C. 7139(b)) is amended by striking paragraph (6) 
     and inserting the following:
       ``(6) to carry out such additional duties assigned to the 
     Office by the Secretary.''.

     SEC. 1007. OTHER TRANSACTIONS AUTHORITY.

       Section 646 of the Department of Energy Organization Act 
     (42 U.S.C. 7256) is amended by adding at the end the 
     following:
       ``(g)(1) In addition to authority granted to the Secretary 
     under any other provision of law, the Secretary may exercise 
     the same authority to enter into transactions (other than 
     contracts, cooperative agreements, and grants), subject to 
     the same terms and conditions as the Secretary of Defense 
     under section 2371 of title 10, United States Code (other 
     than subsections (b) and (f) of that section).
       ``(2) In applying section 2371 of title 10, United States 
     Code, to the Secretary under paragraph (1)--
       ``(A) the term `basic' shall be replaced by the term 
     `research';
       ``(B) the term `applied' shall be replaced by the term 
     `development'; and

[[Page 17886]]

       ``(C) the terms `advanced research projects' and `advanced 
     research' shall be replaced by the term `demonstration 
     projects'.
       ``(3) The authority of the Secretary under paragraph (1) 
     shall not be subject to--
       ``(A) section 9 of the Federal Nonnuclear Energy Research 
     and Development Act of 1974 (42 U.S.C. 5908); or
       ``(B) section 152 of the Atomic Energy Act of 1954 (42 
     U.S.C. 2182).
       ``(4)(A) The Secretary shall use such competitive, merit-
     based selection procedures in entering into transactions 
     under paragraph (1), as the Secretary determines in writing 
     to be practicable.
       ``(B) A transaction under paragraph (1) shall relate to a 
     research, development, or demonstration project only if the 
     Secretary determines in writing that the use of a standard 
     contract, grant, or cooperative agreement for the project is 
     not feasible or appropriate.
       ``(5) The Secretary may protect from disclosure, for up to 
     5 years after the date on which the information is developed, 
     any information developed pursuant to a transaction under 
     paragraph (1) that would be protected from disclosure under 
     section 552(b)(4) of title 5, United States Code, if obtained 
     from a person other than a Federal agency.
       ``(6)(A) Not later than 90 days after the date of enactment 
     of this subsection, the Secretary shall issue guidelines for 
     transactions under paragraph (1).
       ``(B) The guidelines shall be published in the Federal 
     Register for public comment in accordance with rulemaking 
     procedures of the Department.
       ``(C) The Secretary shall not have authority to carry out 
     transactions under paragraph (1) until the guidelines for 
     transactions required under subparagraph (A) are final.
       ``(7) The annual report of the head of an executive agency 
     under section 2371(h) of title 10, United States Code, shall 
     be submitted to Congress.
       ``(8)(A) In this paragraph, the term `nontraditional 
     Government contractor' has the meaning given the term 
     `nontraditional defense contractor' in section 845(f) of the 
     National Defense Authorization Act for Fiscal Year 1994 
     (Public Law 103-160; 10 U.S.C. 2371 note).
       ``(B) Not later than 1 year after the date on which the 
     final guidelines are published under paragraph (6), the 
     Comptroller General of the United States shall submit to 
     Congress a report describing--
       ``(i) the use by the Department of authorities under this 
     section, including the ability to attract nontraditional 
     Government contractors; and
       ``(ii) whether additional safeguards are necessary to carry 
     out the authorities.
       ``(9) The authority of the Secretary under this subsection 
     may be delegated only to an officer of the Department who is 
     appointed by the President by and with the advice and consent 
     of the Senate.
       ``(10) Notwithstanding any other provision of law, the 
     authority to enter into transactions under paragraph (1) 
     shall terminate on September 30, 2010.''.

     SEC. 1008. PRIZES FOR ACHIEVEMENT IN GRAND CHALLENGES OF 
                   SCIENCE AND TECHNOLOGY.

       (a) Authority.--The Secretary may carry out a program to 
     award cash prizes in recognition of breakthrough achievements 
     in research, development, demonstration, and commercial 
     application that have the potential for application to the 
     performance of the mission of the Department.
       (b) Competition Requirements.--The program under subsection 
     (a) may include prizes for the achievement of goals 
     articulated by the Secretary in a specific area through a 
     widely advertised solicitation of submission of results for 
     research, development, demonstration, or commercial 
     application projects.
       (c) Prizes for Processes and Technologies To Reduce 
     Dependence on Imported Oil.--The Secretary, in cooperation 
     with the Freedom Prize Foundation, shall support a program of 
     awarding prizes, to be known as Freedom Prizes, to encourage 
     and recognize the development and deployment of processes and 
     technologies that serve to reduce the dependence of the 
     United States on imported oil.
       (d) Relationship to Other Authority.--The program under 
     subsection (a) may be carried out in conjunction with or in 
     addition to the exercise of any other authority of the 
     Secretary to acquire, support, or stimulate research, 
     development, demonstration, or commercial application 
     projects.
       (e) Authorization of Appropriations.--There are authorized 
     to be appropriated--
       (1) $10,000,000 to carry out the program under subsection 
     (a); and
       (2) $5,000,000 to carry out the program under subsection 
     (c).

     SEC. 1009. TECHNICAL CORRECTIONS.

       (a) Coal Research and Development.--
       (1) In general.--Public Law 86-599 (30 U.S.C. 661 et seq.) 
     is amended--
       (A) by striking the first section (30 U.S.C. 661) and 
     inserting the following:
       ``Sec. 1. (a) This Act may be cited as the `Coal Research 
     and Development Act of 1960'.
       ``(b) In this Act:
       ``(1) The term `research' means scientific, technical, and 
     economic research and the practical application of that 
     research.
       ``(2) The term `Secretary' means the Secretary of 
     Energy.'';
       (B) in section 2 (30 U.S.C. 662), by striking ``shall 
     establish within'' and all that follows through ``such 
     Office'';
       (C) by striking sections 3, 4, and 7 (30 U.S.C. 663, 664, 
     667); and
       (D) by redesignating sections 5, 6, and 8 (30 U.S.C. 665, 
     666, 668) as sections 3, 4, and 5, respectively.
       (2) Patents.--Section 210(a)(8) of title 35, United States 
     Code, is amended by striking ``Coal Research Development Act 
     of 1960'' and inserting ``Coal Research and Development Act 
     of 1960''.
       (b) Nonnuclear Energy Research and Development.--
       (1) Short title; definitions.--Section 1 of the Federal 
     Nonnuclear Energy Research and Development Act of 1974 (42 
     U.S.C. 5902) is amended to read as follows:


                     ``SHORT TITLE AND DEFINITIONS

       ``Sec. 1. (a) This Act may be cited as the `Federal 
     Nonnuclear Energy Research and Development Act of 1974''.
       ``(b) In this Act:
       ``(1) The term `Department' means the Department of Energy.
       ``(2) The term `Secretary' means the Secretary of 
     Energy.''.
       (2) Statement of policy.--Section 3(b) of the Federal 
     Nonnuclear Energy Research and Development Act of 1974 (42 
     U.S.C. 5902(b)) is amended--
       (A) in paragraph (1), by striking ``Energy Research and 
     Development Administration'' and inserting ``Department'';
       (B) in paragraph (2), by striking ``Administrator of the 
     Energy Research and Development Administration (hereinafter 
     in this Act referred to as the `Administrator')'' and 
     inserting ``Secretary''; and
       (C) in paragraph (3)--
       (i) by striking ``Administrator'' and inserting 
     ``Secretary''; and
       (ii) by inserting ``Demonstration'' after ``Cooling''.
       (3) Duties and authorities.--Section 4 of the Federal 
     Nonnuclear Energy Research and Development Act of 1974 (42 
     U.S.C. 5903) is amended--
       (A) by striking the section heading and inserting the 
     following: ``duties and authorities of the secretary''; and
       (B) in the matter preceding subsection (a), by striking 
     ``Administrator'' and inserting ``Secretary''.
       (4) Comprehensive planning and programming.--Section 6 of 
     the Federal Nonnuclear Energy Research and Development Act of 
     1974 (42 U.S.C. 5905) is amended--
       (A) by striking ``Administrator'' each place it appears and 
     inserting ``Secretary''; and
       (B) in subsection (b)(3)--
       (i) in subparagraph (I), by inserting ``Demonstration'' 
     after ``Cooling''; and
       (ii) in subparagraph (L), by inserting ``Energy'' after 
     ``Solar''.
       (5) Forms of federal assistance.--Section 7 of the Federal 
     Nonnuclear Energy Research and Development Act of 1974 (42 
     U.S.C. 5906) is amended--
       (A) by striking ``Administrator'' each place it appears and 
     inserting ``Secretary''; and
       (B) in subsection (a)(4), by striking ``of the section''.
       (6) Demonstrations.--Section 8 of the Federal Nonnuclear 
     Energy Research and Development Act of 1974 (42 U.S.C. 5907) 
     is amended--
       (A) in subsections (a) through (c), by striking 
     ``Administrator'' each place it appears and inserting 
     ``Secretary'';
       (B) in subsection (d)--
       (i) in the first sentence of paragraph (1), by inserting 
     ``of the Energy Research and Development Administration'' 
     after ``Administrator''; and
       (ii) in paragraph (3), by striking ``Administrator'' and 
     inserting ``Secretary''; and
       (C) in subsection (f)--
       (i) by striking ``Administrator'' each place it appears and 
     inserting ``Secretary''; and
       (ii) in the proviso of the first sentence, by striking 
     ``Administrator's'' and inserting ``Secretary's''.
       (7) Patent policy.--Section 9 of the Federal Nonnuclear 
     Energy Research and Development Act of 1974 (42 U.S.C. 5908) 
     is amended--
       (A) by striking ``Administration'' each place it appears 
     and inserting ``Department'';
       (B) by striking ``Administrator'' each place it appears and 
     inserting ``Secretary''; and
       (C) in subsection (c)(3), by striking ``Administration's'' 
     and inserting ``Department's''.
       (8) Acquisition of essential materials.--Section 12 of the 
     Federal Nonnuclear Energy Research and Development Act of 
     1974 (42 U.S.C. 5911) is amended by striking subsection (b) 
     and inserting the following:
       ``(b) A rule or order under subsection (a) shall be 
     considered to be a major rule subject to chapter 8 of title 
     5, United States Code.''.
       (9) Water resource evaluation.--Section 13 of the Federal 
     Nonnuclear Energy Research and Development Act of 1974 (42 
     U.S.C. 5912) is amended by striking ``Administrator'' each 
     place it appears and inserting ``Secretary''.
       (10) Authorization of appropriations.--Section 16 of the 
     Federal Nonnuclear Energy Research and Development Act of 
     1974 (42 U.S.C. 5915) is amended--
       (A) by striking the section heading and inserting the 
     following: ``authorization of appropriations'';
       (B) by striking ``(a) There may be appropriated to the 
     Administrator'' and inserting ``There may be appropriated to 
     the Secretary''; and
       (C) by striking subsections (b) and (c).
       (11) Central source of nonnuclear energy information.--
     Section 17 of the Federal Nonnuclear Energy Research and 
     Development Act of 1974 (42 U.S.C. 5916) is amended--

[[Page 17887]]

       (A) by striking ``Administrator'' each place it appears and 
     inserting ``Secretary'';
       (B) in the first sentence, by striking ``Administrator's'';
       (C) in the second sentence, by striking ``he'' and 
     inserting ``the Secretary'';
       (D) in the third sentence--
       (i) in paragraph (2) of the first proviso, by striking 
     ``section 1905 or title 18'' and inserting ``section 1905 of 
     title 18''; and
       (ii) in subparagraph (B) of the second proviso--

       (I) by striking ``the Federal Energy Administration,'';
       (II) by striking ``the Federal Power Commission,'' and 
     inserting ``the Federal Energy Regulatory Commission''; and
       (III) by striking ``General Accounting Office'' and 
     inserting ``Government Accountability Office''; and

       (E) in the last sentence, by inserting ``or ranking 
     minority member'' after ``chairman''.
       (12) Energy information, loan guarantees, and financial 
     support.--Sections 18 through 20 of the Federal Nonnuclear 
     Energy Research and Development Act of 1974 (42 U.S.C. 5917 
     through 5920) are repealed.
       (c) Stevenson-Wydler Technology Innovation Act of 1980.--
     Section 20 of the Stevenson-Wydler Technology Innovation Act 
     of 1980 (15 U.S.C. 3712) is amended by striking ``and the 
     National Science Foundation'' and inserting ``, the Secretary 
     of Energy, and the Director of the National Science 
     Foundation''.

     SEC. 1010. UNIVERSITY COLLABORATION.

       Not later than 2 years after the date of enactment of this 
     Act, the Secretary shall transmit to the Congress a report 
     that examines the feasibility of promoting collaborations 
     between major universities and other colleges and 
     universities in grants, contracts, and cooperative agreements 
     made by the Secretary for energy projects. For purposes of 
     this section, major universities are schools listed by the 
     Carnegie Foundation as Doctoral Research Extensive 
     Universities. The Secretary shall also consider providing 
     incentives to increase the inclusion of small institutions of 
     higher education, including minority-serving institutions, in 
     energy grants, contracts, and cooperative agreements.

     SEC. 1011. SENSE OF CONGRESS.

       It is the sense of Congress that--
       (1) the Secretary should develop and implement more 
     stringent procurement and inventory controls, including 
     controls on the purchase card program, to prevent waste, 
     fraud, and abuse of taxpayer funds by employees and 
     contractors of the Department; and
       (2) the Department's Inspector General should continue to 
     closely review purchase card purchases and other procurement 
     and inventory practices at the Department.
                    TITLE XI--PERSONNEL AND TRAINING

     SEC. 1101. WORKFORCE TRENDS AND TRAINEESHIP GRANTS.

       (a) Definitions.--In this section:
       (1) Energy technology industry.--The term ``energy 
     technology industry'' includes--
       (A) a renewable energy industry;
       (B) a company that develops or commercializes a device to 
     increase energy efficiency;
       (C) the oil and gas industry;
       (D) the nuclear power industry;
       (E) the coal industry;
       (F) the electric utility industry; and
       (G) any other industrial sector, as the Secretary 
     determines to be appropriate.
       (2) Skilled technical personnel.--The term ``skilled 
     technical personnel'' means--
       (A) journey- and apprentice-level workers who are enrolled 
     in, or have completed, a federally-recognized or State-
     recognized apprenticeship program; and
       (B) other skilled workers in energy technology industries, 
     as determined by the Secretary.
       (b) Workforce Trends.--
       (1) Monitoring.--The Secretary, in consultation with, and 
     using data collected by, the Secretary of Labor, shall 
     monitor trends in the workforce of--
       (A) skilled technical personnel that support energy 
     technology industries; and
       (B) electric power and transmission engineers.
       (2) Report on trends.--Not later than 1 year after the date 
     of enactment of this Act, the Secretary shall submit to 
     Congress a report on current trends under paragraph (1), with 
     recommendations (as appropriate) to meet the future labor 
     requirements for the energy technology industries.
       (3) Report on shortage.--As soon as practicable after the 
     date on which the Secretary identifies or predicts a 
     significant national shortage of skilled technical personnel 
     in 1 or more energy technology industries, the Secretary 
     shall submit to Congress a report describing the shortage.
       (c) Traineeship Grants for Skilled Technical Personnel.--
     The Secretary, in consultation with the Secretary of Labor, 
     may establish programs in the appropriate offices of the 
     Department under which the Secretary provides grants to 
     enhance training (including distance learning) for any 
     workforce category for which a shortage is identified or 
     predicted under subsection (b)(2).
       (d) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $20,000,000 for 
     each of fiscal years 2006 through 2008.

     SEC. 1102. EDUCATIONAL PROGRAMS IN SCIENCE AND MATHEMATICS.

       (a) Science Education Enhancement Fund.--Section 3164 of 
     the Department of Energy Science Education Enhancement Act 
     (42 U.S.C. 7381a) is amended by adding at the end:
       ``(c) Science Education Enhancement Fund.--The Secretary 
     shall use not less than 0.3 percent of the amount made 
     available to the Department for research, development, 
     demonstration, and commercial application for fiscal year 
     2006 and each fiscal year thereafter to carry out activities 
     authorized by this part.''.
       (b) Authorized Education Activities.--Section 3165 of the 
     Department of Energy Science Education Enhancement Act (42 
     U.S.C. 7381b) is amended by adding at the end the following:
       ``(14) Support competitive events for students under the 
     supervision of teachers, designed to encourage student 
     interest and knowledge in science and mathematics.
       ``(15) Support competitively-awarded, peer-reviewed 
     programs to promote professional development for mathematics 
     teachers and science teachers who teach in grades from 
     kindergarten through grade 12 at Department research and 
     development facilities.
       ``(16) Support summer internships at Department research 
     and development facilities, for mathematics teachers and 
     science teachers who teach in grades from kindergarten 
     through grade 12.
       ``(17) Sponsor and assist in educational and training 
     activities identified as critical skills needs for future 
     workforce development at Department research and development 
     facilities.''.
       (c) Educational Partnerships.--Section 3166(b) of the 
     Department of Energy Science Education Enhancement Act (42 
     U.S.C. 7381c(b)) is amended--
       (1) by striking paragraph (1) and inserting the following:
       ``(1) loaning or transferring equipment to the 
     institution;'';
       (2) in paragraph (5), by striking ``and'' at the end;
       (3) in paragraph (6), by striking the period at the end and 
     inserting ``; and''; and
       (4) by adding at the end the following:
       ``(7) providing funds to educational institutions to hire 
     personnel to facilitate interactions between local school 
     systems, Department research and development facilities, and 
     corporate and governmental entities.''.
       (d) Definition of Department Research and Development 
     Facilities.--Section 3167(3) of the Department of Energy 
     Science Education Enhancement Act (42 U.S.C. 7381d(3)) is 
     amended by striking ``from the Office of Science of the 
     Department of Energy'' and inserting ``by the Department of 
     Energy''.
       (e) Study.--
       (1) In general.--The Secretary, in consultation with the 
     Secretary of Education, shall enter into an arrangement with 
     the National Academy of Public Administration to conduct a 
     study of the priorities, quality, local and regional 
     flexibility, and plans for educational programs at Department 
     research and development facilities.
       (2) Inclusion.--The study shall recommend measures that the 
     Secretary may take to improve Department-wide coordination of 
     educational, workforce development, and critical skills 
     development activities.
       (3) Report.--Not later than 2 years after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     a report on the results of the study conducted under this 
     subsection.

     SEC. 1103. TRAINING GUIDELINES FOR NONNUCLEAR ELECTRIC ENERGY 
                   INDUSTRY PERSONNEL.

       (a) In General.--The Secretary of Labor, in consultation 
     with the Secretary and in conjunction with the electric 
     industry and recognized employee representatives, shall 
     develop model personnel training guidelines to support the 
     reliability and safety of the nonnuclear electric system.
       (b) Requirements.--The training guidelines under subsection 
     (a) shall, at a minimum--
       (1) include training requirements for workers engaged in 
     the construction, operation, inspection, or maintenance of 
     nonnuclear electric generation, transmission, or distribution 
     systems, including requirements relating to--
       (A) competency;
       (B) certification; and
       (C) assessment, including--
       (i) initial and continuous evaluation of workers;
       (ii) recertification procedures; and
       (iii) methods for examining or testing the qualification of 
     an individual who performs a covered task; and
       (2) consolidate training guidelines in existence on the 
     date on which the guidelines under subsection (a) are 
     developed relating to the construction, operation, 
     maintenance, and inspection of nonnuclear electric 
     generation, transmission, and distribution facilities, such 
     as guidelines established by the National Electric Safety 
     Code and other industry consensus standards.

     SEC. 1104. NATIONAL CENTER FOR ENERGY MANAGEMENT AND BUILDING 
                   TECHNOLOGIES.

       The Secretary shall support the ongoing activities of and 
     explore opportunities for expansion of the National Center 
     for Energy Management and Building Technologies to carry out 
     research, education, and training activities to facilitate 
     the improvement of energy efficiency, indoor environmental 
     quality, and security of industrial, commercial, residential, 
     and public buildings.

     SEC. 1105. IMPROVED ACCESS TO ENERGY-RELATED SCIENTIFIC AND 
                   TECHNICAL CAREERS.

       (a) Science Education Programs.--Section 3164 of the 
     Department of Energy Science Education Enhancement Act (42 
     U.S.C. 7381a) (as

[[Page 17888]]

     amended by section 1102(a)) is amended by adding at the end 
     the following:
       ``(d) Programs for Students From Under-Represented 
     Groups.--In carrying out a program under subsection (a), the 
     Secretary shall give priority to activities that are designed 
     to encourage students from under-represented groups to pursue 
     scientific and technical careers.''.
       (b) Partnerships With Historically Black Colleges and 
     Universities, Hispanic-Servicing Institutions, and Tribal 
     Colleges.--The Department of Energy Science Education 
     Enhancement Act (42 U.S.C. 7381 et seq.) is amended--
       (1) by redesignating sections 3167 and 3168 as sections 
     3168 and 3169, respectively; and
       (2) by inserting after section 3166 the following:

     ``SEC. 3167. PARTNERSHIPS WITH HISTORICALLY BLACK COLLEGES 
                   AND UNIVERSITIES, HISPANIC-SERVING 
                   INSTITUTIONS, AND TRIBAL COLLEGES.

       ``(a) Definitions.--In this section:
       ``(1) Hispanic-serving institution.--The term `Hispanic-
     serving institution' has the meaning given the term in 
     section 502(a) of the Higher Education Act of 1965 (20 U.S.C. 
     1101a(a)).
       ``(2) Historically black college or university.--The term 
     `historically Black college or university' has the meaning 
     given the term `part B institution' in section 322 of the 
     Higher Education Act of 1965 (20 U.S.C. 1061).
       ``(3) National laboratory.--The term `National Laboratory' 
     has the meaning given the term in section 2 of the Energy 
     Policy Act of 2005.
       ``(4) Science facility.--The term `science facility' has 
     the meaning given the term `single-purpose research facility' 
     in section 903 of the Energy Policy Act of 2005.
       ``(5) Tribal college.--The term `tribal college' has the 
     meaning given the term `tribally controlled college or 
     university' in section 2(a) of the Tribally Controlled 
     College Assistance Act of 1978 (25 U.S.C. 1801(a)).
       ``(b) Education Partnership.--The Secretary shall require 
     the director of each National Laboratory, and may require the 
     head of any science facility, to increase the participation 
     of historically Black colleges or universities, Hispanic-
     serving institutions, or tribal colleges in any activity that 
     increases the capacity of the historically Black colleges or 
     universities, Hispanic-serving institutions, or tribal 
     colleges to train personnel in science or engineering.
       ``(c) Activities.--An activity described in subsection (b) 
     includes--
       ``(1) collaborative research;
       ``(2) equipment transfer;
       ``(3) training activities carried out at a National 
     Laboratory or science facility; and
       ``(4) mentoring activities carried out at a National 
     Laboratory or science facility.
       ``(d) Report.--Not later than 2 years after the date of 
     enactment of this subsection, the Secretary shall submit to 
     Congress a report describing the activities carried out under 
     this section.''.

     SEC. 1106. NATIONAL POWER PLANT OPERATIONS TECHNOLOGY AND 
                   EDUCATIONAL CENTER.

       (a) Establishment.--The Secretary shall support the 
     establishment of a National Power Plant Operations Technology 
     and Education Center (referred to in this section as the 
     ``Center''), to address the need for training and educating 
     certified operators and technicians for the electric power 
     industry.
       (b) Location of Center.--The Secretary shall support the 
     establishment of the Center at an institution of higher 
     education that has--
       (1) expertise in providing degree programs in electric 
     power generation, transmission, and distribution 
     technologies;
       (2) expertise in providing onsite and Internet-based 
     training; and
       (3) demonstrated responsiveness to workforce and training 
     requirements in the electric power industry.
       (c) Training and Continuing Education.--
       (1) In general.--The Center shall provide training and 
     continuing education in electric power generation, 
     transmission, and distribution technologies and operations.
       (2) Location.--The Center shall carry out training and 
     education activities under paragraph (1)--
       (A) at the Center; and
       (B) through Internet-based information technologies that 
     allow for learning at remote sites.
                         TITLE XII--ELECTRICITY

     SEC. 1201. SHORT TITLE.

       This title may be cited as the ``Electricity Modernization 
     Act of 2005''.
                   Subtitle A--Reliability Standards

     SEC. 1211. ELECTRIC RELIABILITY STANDARDS.

       (a) In General.--Part II of the Federal Power Act (16 U.S.C 
     824 et seq.) is amended by adding at the end the following:

     ``SEC. 215. ELECTRIC RELIABILITY.

       ``(a) Definitions.--For purposes of this section:
       ``(1) The term `bulk-power system' means--
       ``(A) facilities and control systems necessary for 
     operating an interconnected electric energy transmission 
     network (or any portion thereof); and
       ``(B) electric energy from generation facilities needed to 
     maintain transmission system reliability.

     The term does not include facilities used in the local 
     distribution of electric energy.
       ``(2) The terms `Electric Reliability Organization' and 
     `ERO' mean the organization certified by the Commission under 
     subsection (c) the purpose of which is to establish and 
     enforce reliability standards for the bulk-power system, 
     subject to Commission review.
       ``(3) The term `reliability standard' means a requirement, 
     approved by the Commission under this section, to provide for 
     reliable operation of the bulk-power system. The term 
     includes requirements for the operation of existing bulk-
     power system facilities, including cybersecurity protection, 
     and the design of planned additions or modifications to such 
     facilities to the extent necessary to provide for reliable 
     operation of the bulk-power system, but the term does not 
     include any requirement to enlarge such facilities or to 
     construct new transmission capacity or generation capacity.
       ``(4) The term `reliable operation' means operating the 
     elements of the bulk-power system within equipment and 
     electric system thermal, voltage, and stability limits so 
     that instability, uncontrolled separation, or cascading 
     failures of such system will not occur as a result of a 
     sudden disturbance, including a cybersecurity incident, or 
     unanticipated failure of system elements.
       ``(5) The term `Interconnection' means a geographic area in 
     which the operation of bulk-power system components is 
     synchronized such that the failure of 1 or more of such 
     components may adversely affect the ability of the operators 
     of other components within the system to maintain reliable 
     operation of the facilities within their control.
       ``(6) The term `transmission organization' means a Regional 
     Transmission Organization, Independent System Operator, 
     independent transmission provider, or other transmission 
     organization finally approved by the Commission for the 
     operation of transmission facilities.
       ``(7) The term `regional entity' means an entity having 
     enforcement authority pursuant to subsection (e)(4).
       ``(8) The term `cybersecurity incident' means a malicious 
     act or suspicious event that disrupts, or was an attempt to 
     disrupt, the operation of those programmable electronic 
     devices and communication networks including hardware, 
     software and data that are essential to the reliable 
     operation of the bulk power system.
       ``(b) Jurisdiction and Applicability.--(1) The Commission 
     shall have jurisdiction, within the United States, over the 
     ERO certified by the Commission under subsection (c), any 
     regional entities, and all users, owners and operators of the 
     bulk-power system, including but not limited to the entities 
     described in section 201(f), for purposes of approving 
     reliability standards established under this section and 
     enforcing compliance with this section. All users, owners and 
     operators of the bulk-power system shall comply with 
     reliability standards that take effect under this section.
       ``(2) The Commission shall issue a final rule to implement 
     the requirements of this section not later than 180 days 
     after the date of enactment of this section.
       ``(c) Certification.--Following the issuance of a 
     Commission rule under subsection (b)(2), any person may 
     submit an application to the Commission for certification as 
     the Electric Reliability Organization. The Commission may 
     certify 1 such ERO if the Commission determines that such 
     ERO--
       ``(1) has the ability to develop and enforce, subject to 
     subsection (e)(2), reliability standards that provide for an 
     adequate level of reliability of the bulk-power system; and
       ``(2) has established rules that--
       ``(A) assure its independence of the users and owners and 
     operators of the bulk-power system, while assuring fair 
     stakeholder representation in the selection of its directors 
     and balanced decisionmaking in any ERO committee or 
     subordinate organizational structure;
       ``(B) allocate equitably reasonable dues, fees, and other 
     charges among end users for all activities under this 
     section;
       ``(C) provide fair and impartial procedures for enforcement 
     of reliability standards through the imposition of penalties 
     in accordance with subsection (e) (including limitations on 
     activities, functions, or operations, or other appropriate 
     sanctions);
       ``(D) provide for reasonable notice and opportunity for 
     public comment, due process, openness, and balance of 
     interests in developing reliability standards and otherwise 
     exercising its duties; and
       ``(E) provide for taking, after certification, appropriate 
     steps to gain recognition in Canada and Mexico.
       ``(d) Reliability Standards.--(1) The Electric Reliability 
     Organization shall file each reliability standard or 
     modification to a reliability standard that it proposes to be 
     made effective under this section with the Commission.
       ``(2) The Commission may approve, by rule or order, a 
     proposed reliability standard or modification to a 
     reliability standard if it determines that the standard is 
     just, reasonable, not unduly discriminatory or preferential, 
     and in the public interest. The Commission shall give due 
     weight to the technical expertise of the Electric Reliability 
     Organization with respect to the content of a proposed 
     standard or modification to a reliability standard and to the 
     technical expertise of a regional entity organized on an 
     Interconnection-wide basis with respect to a reliability 
     standard to be applicable within that Interconnection, but 
     shall not defer with respect to the effect of a standard on 
     competition. A proposed standard or modification shall take 
     effect upon approval by the Commission.
       ``(3) The Electric Reliability Organization shall 
     rebuttably presume that a proposal from a regional entity 
     organized on an Interconnection-wide basis for a reliability 
     standard or

[[Page 17889]]

     modification to a reliability standard to be applicable on an 
     Interconnection-wide basis is just, reasonable, and not 
     unduly discriminatory or preferential, and in the public 
     interest.
       ``(4) The Commission shall remand to the Electric 
     Reliability Organization for further consideration a proposed 
     reliability standard or a modification to a reliability 
     standard that the Commission disapproves in whole or in part.
       ``(5) The Commission, upon its own motion or upon 
     complaint, may order the Electric Reliability Organization to 
     submit to the Commission a proposed reliability standard or a 
     modification to a reliability standard that addresses a 
     specific matter if the Commission considers such a new or 
     modified reliability standard appropriate to carry out this 
     section.
       ``(6) The final rule adopted under subsection (b)(2) shall 
     include fair processes for the identification and timely 
     resolution of any conflict between a reliability standard and 
     any function, rule, order, tariff, rate schedule, or 
     agreement accepted, approved, or ordered by the Commission 
     applicable to a transmission organization. Such transmission 
     organization shall continue to comply with such function, 
     rule, order, tariff, rate schedule or agreement accepted 
     approved, or ordered by the Commission until--
       ``(A) the Commission finds a conflict exists between a 
     reliability standard and any such provision;
       ``(B) the Commission orders a change to such provision 
     pursuant to section 206 of this part; and
       ``(C) the ordered change becomes effective under this part.

     If the Commission determines that a reliability standard 
     needs to be changed as a result of such a conflict, it shall 
     order the ERO to develop and file with the Commission a 
     modified reliability standard under paragraph (4) or (5) of 
     this subsection.
       ``(e) Enforcement.--(1) The ERO may impose, subject to 
     paragraph (2), a penalty on a user or owner or operator of 
     the bulk-power system for a violation of a reliability 
     standard approved by the Commission under subsection (d) if 
     the ERO, after notice and an opportunity for a hearing--
       ``(A) finds that the user or owner or operator has violated 
     a reliability standard approved by the Commission under 
     subsection (d); and
       ``(B) files notice and the record of the proceeding with 
     the Commission.
       ``(2) A penalty imposed under paragraph (1) may take effect 
     not earlier than the 31st day after the ERO files with the 
     Commission notice of the penalty and the record of 
     proceedings. Such penalty shall be subject to review by the 
     Commission, on its own motion or upon application by the 
     user, owner or operator that is the subject of the penalty 
     filed within 30 days after the date such notice is filed with 
     the Commission. Application to the Commission for review, or 
     the initiation of review by the Commission on its own motion, 
     shall not operate as a stay of such penalty unless the 
     Commission otherwise orders upon its own motion or upon 
     application by the user, owner or operator that is the 
     subject of such penalty. In any proceeding to review a 
     penalty imposed under paragraph (1), the Commission, after 
     notice and opportunity for hearing (which hearing may consist 
     solely of the record before the ERO and opportunity for the 
     presentation of supporting reasons to affirm, modify, or set 
     aside the penalty), shall by order affirm, set aside, 
     reinstate, or modify the penalty, and, if appropriate, remand 
     to the ERO for further proceedings. The Commission shall 
     implement expedited procedures for such hearings.
       ``(3) On its own motion or upon complaint, the Commission 
     may order compliance with a reliability standard and may 
     impose a penalty against a user or owner or operator of the 
     bulk-power system if the Commission finds, after notice and 
     opportunity for a hearing, that the user or owner or operator 
     of the bulk-power system has engaged or is about to engage in 
     any acts or practices that constitute or will constitute a 
     violation of a reliability standard.
       ``(4) The Commission shall issue regulations authorizing 
     the ERO to enter into an agreement to delegate authority to a 
     regional entity for the purpose of proposing reliability 
     standards to the ERO and enforcing reliability standards 
     under paragraph (1) if--
       ``(A) the regional entity is governed by--
       ``(i) an independent board;
       ``(ii) a balanced stakeholder board; or
       ``(iii) a combination independent and balanced stakeholder 
     board.
       ``(B) the regional entity otherwise satisfies the 
     provisions of subsection (c)(1) and (2); and
       ``(C) the agreement promotes effective and efficient 
     administration of bulk-power system reliability.

     The Commission may modify such delegation. The ERO and the 
     Commission shall rebuttably presume that a proposal for 
     delegation to a regional entity organized on an 
     Interconnection-wide basis promotes effective and efficient 
     administration of bulk-power system reliability and should be 
     approved. Such regulation may provide that the Commission may 
     assign the ERO's authority to enforce reliability standards 
     under paragraph (1) directly to a regional entity consistent 
     with the requirements of this paragraph.
       ``(5) The Commission may take such action as is necessary 
     or appropriate against the ERO or a regional entity to ensure 
     compliance with a reliability standard or any Commission 
     order affecting the ERO or a regional entity.
       ``(6) Any penalty imposed under this section shall bear a 
     reasonable relation to the seriousness of the violation and 
     shall take into consideration the efforts of such user, 
     owner, or operator to remedy the violation in a timely 
     manner.
       ``(f) Changes in Electric Reliability Organization Rules.--
     The Electric Reliability Organization shall file with the 
     Commission for approval any proposed rule or proposed rule 
     change, accompanied by an explanation of its basis and 
     purpose. The Commission, upon its own motion or complaint, 
     may propose a change to the rules of the ERO. A proposed rule 
     or proposed rule change shall take effect upon a finding by 
     the Commission, after notice and opportunity for comment, 
     that the change is just, reasonable, not unduly 
     discriminatory or preferential, is in the public interest, 
     and satisfies the requirements of subsection (c).
       ``(g) Reliability Reports.--The ERO shall conduct periodic 
     assessments of the reliability and adequacy of the bulk-power 
     system in North America.
       ``(h) Coordination With Canada and Mexico.--The President 
     is urged to negotiate international agreements with the 
     governments of Canada and Mexico to provide for effective 
     compliance with reliability standards and the effectiveness 
     of the ERO in the United States and Canada or Mexico.
       ``(i) Savings Provisions.--(1) The ERO shall have authority 
     to develop and enforce compliance with reliability standards 
     for only the bulk-power system.
       ``(2) This section does not authorize the ERO or the 
     Commission to order the construction of additional generation 
     or transmission capacity or to set and enforce compliance 
     with standards for adequacy or safety of electric facilities 
     or services.
       ``(3) Nothing in this section shall be construed to preempt 
     any authority of any State to take action to ensure the 
     safety, adequacy, and reliability of electric service within 
     that State, as long as such action is not inconsistent with 
     any reliability standard, except that the State of New York 
     may establish rules that result in greater reliability within 
     that State, as long as such action does not result in lesser 
     reliability outside the State than that provided by the 
     reliability standards.
       ``(4) Within 90 days of the application of the Electric 
     Reliability Organization or other affected party, and after 
     notice and opportunity for comment, the Commission shall 
     issue a final order determining whether a State action is 
     inconsistent with a reliability standard, taking into 
     consideration any recommendation of the ERO.
       ``(5) The Commission, after consultation with the ERO and 
     the State taking action, may stay the effectiveness of any 
     State action, pending the Commission's issuance of a final 
     order.
       ``(j) Regional Advisory Bodies.--The Commission shall 
     establish a regional advisory body on the petition of at 
     least \2/3\ of the States within a region that have more than 
     \1/2\ of their electric load served within the region. A 
     regional advisory body shall be composed of 1 member from 
     each participating State in the region, appointed by the 
     Governor of each State, and may include representatives of 
     agencies, States, and provinces outside the United States. A 
     regional advisory body may provide advice to the Electric 
     Reliability Organization, a regional entity, or the 
     Commission regarding the governance of an existing or 
     proposed regional entity within the same region, whether a 
     standard proposed to apply within the region is just, 
     reasonable, not unduly discriminatory or preferential, and in 
     the public interest, whether fees proposed to be assessed 
     within the region are just, reasonable, not unduly 
     discriminatory or preferential, and in the public interest 
     and any other responsibilities requested by the Commission. 
     The Commission may give deference to the advice of any such 
     regional advisory body if that body is organized on an 
     Interconnection-wide basis.
       ``(k) Alaska and Hawaii.--The provisions of this section do 
     not apply to Alaska or Hawaii.''.
       (b) Status of ERO.--The Electric Reliability Organization 
     certified by the Federal Energy Regulatory Commission under 
     section 215(c) of the Federal Power Act and any regional 
     entity delegated enforcement authority pursuant to section 
     215(e)(4) of that Act are not departments, agencies, or 
     instrumentalities of the United States Government.
       (c) Access Approvals by Federal Agencies.--Federal agencies 
     responsible for approving access to electric transmission or 
     distribution facilities located on lands within the United 
     States shall, in accordance with applicable law, expedite any 
     Federal agency approvals that are necessary to allow the 
     owners or operators of such facilities to comply with any 
     reliability standard, approved by the Commission under 
     section 215 of the Federal Power Act, that pertains to 
     vegetation management, electric service restoration, or 
     resolution of situations that imminently endanger the 
     reliability or safety of the facilities.
         Subtitle B--Transmission Infrastructure Modernization

     SEC. 1221. SITING OF INTERSTATE ELECTRIC TRANSMISSION 
                   FACILITIES.

       (a) In General.--Part II of the Federal Power Act (16 
     U.S.C. 824 et seq.) is amended by adding at the end the 
     following:

     ``SEC. 216. SITING OF INTERSTATE ELECTRIC TRANSMISSION 
                   FACILITIES.

       ``(a) Designation of National Interest Electric 
     Transmission Corridors.--(1) Not later than 1 year after the 
     date of enactment of this section and every 3 years 
     thereafter, the Secretary of Energy (referred to in this 
     section as the `Secretary'), in consultation with affected 
     States, shall conduct a study of electric transmission 
     congestion.

[[Page 17890]]

       ``(2) After considering alternatives and recommendations 
     from interested parties (including an opportunity for comment 
     from affected States), the Secretary shall issue a report, 
     based on the study, which may designate any geographic area 
     experiencing electric energy transmission capacity 
     constraints or congestion that adversely affects consumers as 
     a national interest electric transmission corridor.
       ``(3) The Secretary shall conduct the study and issue the 
     report in consultation with any appropriate regional entity 
     referred to in section 215.
       ``(4) In determining whether to designate a national 
     interest electric transmission corridor under paragraph (2), 
     the Secretary may consider whether--
       ``(A) the economic vitality and development of the 
     corridor, or the end markets served by the corridor, may be 
     constrained by lack of adequate or reasonably priced 
     electricity;
       ``(B)(i) economic growth in the corridor, or the end 
     markets served by the corridor, may be jeopardized by 
     reliance on limited sources of energy; and
       ``(ii) a diversification of supply is warranted;
       ``(C) the energy independence of the United States would be 
     served by the designation;
       ``(D) the designation would be in the interest of national 
     energy policy; and
       ``(E) the designation would enhance national defense and 
     homeland security.
       ``(b) Construction Permit.--Except as provided in 
     subsection (i), the Commission may, after notice and an 
     opportunity for hearing, issue 1 or more permits for the 
     construction or modification of electric transmission 
     facilities in a national interest electric transmission 
     corridor designated by the Secretary under subsection (a) if 
     the Commission finds that--
       ``(1)(A) a State in which the transmission facilities are 
     to be constructed or modified does not have authority to--
       ``(i) approve the siting of the facilities; or
       ``(ii) consider the interstate benefits expected to be 
     achieved by the proposed construction or modification of 
     transmission facilities in the State;
       ``(B) the applicant for a permit is a transmitting utility 
     under this Act but does not qualify to apply for a permit or 
     siting approval for the proposed project in a State because 
     the applicant does not serve end-use customers in the State; 
     or
       ``(C) a State commission or other entity that has authority 
     to approve the siting of the facilities has--
       ``(i) withheld approval for more than 1 year after the 
     filing of an application seeking approval pursuant to 
     applicable law or 1 year after the designation of the 
     relevant national interest electric transmission corridor, 
     whichever is later; or
       ``(ii) conditioned its approval in such a manner that the 
     proposed construction or modification will not significantly 
     reduce transmission congestion in interstate commerce or is 
     not economically feasible;
       ``(2) the facilities to be authorized by the permit will be 
     used for the transmission of electric energy in interstate 
     commerce;
       ``(3) the proposed construction or modification is 
     consistent with the public interest;
       ``(4) the proposed construction or modification will 
     significantly reduce transmission congestion in interstate 
     commerce and protects or benefits consumers;
       ``(5) the proposed construction or modification is 
     consistent with sound national energy policy and will enhance 
     energy independence; and
       ``(6) the proposed modification will maximize, to the 
     extent reasonable and economical, the transmission 
     capabilities of existing towers or structures.
       ``(c) Permit Applications.--(1) Permit applications under 
     subsection (b) shall be made in writing to the Commission.
       ``(2) The Commission shall issue rules specifying--
       ``(A) the form of the application;
       ``(B) the information to be contained in the application; 
     and
       ``(C) the manner of service of notice of the permit 
     application on interested persons.
       ``(d) Comments.--In any proceeding before the Commission 
     under subsection (b), the Commission shall afford each State 
     in which a transmission facility covered by the permit is or 
     will be located, each affected Federal agency and Indian 
     tribe, private property owners, and other interested persons, 
     a reasonable opportunity to present their views and 
     recommendations with respect to the need for and impact of a 
     facility covered by the permit.
       ``(e) Rights-of-Way.--(1) In the case of a permit under 
     subsection (b) for electric transmission facilities to be 
     located on property other than property owned by the United 
     States or a State, if the permit holder cannot acquire by 
     contract, or is unable to agree with the owner of the 
     property to the compensation to be paid for, the necessary 
     right-of-way to construct or modify the transmission 
     facilities, the permit holder may acquire the right-of-way by 
     the exercise of the right of eminent domain in the district 
     court of the United States for the district in which the 
     property concerned is located, or in the appropriate court of 
     the State in which the property is located.
       ``(2) Any right-of-way acquired under paragraph (1) shall 
     be used exclusively for the construction or modification of 
     electric transmission facilities within a reasonable period 
     of time after the acquisition.
       ``(3) The practice and procedure in any action or 
     proceeding under this subsection in the district court of the 
     United States shall conform as nearly as practicable to the 
     practice and procedure in a similar action or proceeding in 
     the courts of the State in which the property is located.
       ``(4) Nothing in this subsection shall be construed to 
     authorize the use of eminent domain to acquire a right-of-way 
     for any purpose other than the construction, modification, 
     operation, or maintenance of electric transmission facilities 
     and related facilities. The right-of-way cannot be used for 
     any other purpose, and the right-of-way shall terminate upon 
     the termination of the use for which the right-of-way was 
     acquired.
       ``(f) Compensation.--(1) Any right-of-way acquired pursuant 
     to subsection (e) shall be considered a taking of private 
     property for which just compensation is due.
       ``(2) Just compensation shall be an amount equal to the 
     fair market value (including applicable severance damages) of 
     the property taken on the date of the exercise of eminent 
     domain authority.
       ``(g) State Law.--Nothing in this section precludes any 
     person from constructing or modifying any transmission 
     facility in accordance with State law.
       ``(h) Coordination of Federal Authorizations for 
     Transmission Facilities.--(1) In this subsection:
       ``(A) The term `Federal authorization' means any 
     authorization required under Federal law in order to site a 
     transmission facility.
       ``(B) The term `Federal authorization' includes such 
     permits, special use authorizations, certifications, 
     opinions, or other approvals as may be required under Federal 
     law in order to site a transmission facility.
       ``(2) The Department of Energy shall act as the lead agency 
     for purposes of coordinating all applicable Federal 
     authorizations and related environmental reviews of the 
     facility.
       ``(3) To the maximum extent practicable under applicable 
     Federal law, the Secretary shall coordinate the Federal 
     authorization and review process under this subsection with 
     any Indian tribes, multistate entities, and State agencies 
     that are responsible for conducting any separate permitting 
     and environmental reviews of the facility, to ensure timely 
     and efficient review and permit decisions.
       ``(4)(A) As head of the lead agency, the Secretary, in 
     consultation with agencies responsible for Federal 
     authorizations and, as appropriate, with Indian tribes, 
     multistate entities, and State agencies that are willing to 
     coordinate their own separate permitting and environmental 
     reviews with the Federal authorization and environmental 
     reviews, shall establish prompt and binding intermediate 
     milestones and ultimate deadlines for the review of, and 
     Federal authorization decisions relating to, the proposed 
     facility.
       ``(B) The Secretary shall ensure that, once an application 
     has been submitted with such data as the Secretary considers 
     necessary, all permit decisions and related environmental 
     reviews under all applicable Federal laws shall be 
     completed--
       ``(i) within 1 year; or
       ``(ii) if a requirement of another provision of Federal law 
     does not permit compliance with clause (i), as soon 
     thereafter as is practicable.
       ``(C) The Secretary shall provide an expeditious pre-
     application mechanism for prospective applicants to confer 
     with the agencies involved to have each such agency determine 
     and communicate to the prospective applicant not later than 
     60 days after the prospective applicant submits a request for 
     such information concerning--
       ``(i) the likelihood of approval for a potential facility; 
     and
       ``(ii) key issues of concern to the agencies and public.
       ``(5)(A) As lead agency head, the Secretary, in 
     consultation with the affected agencies, shall prepare a 
     single environmental review document, which shall be used as 
     the basis for all decisions on the proposed project under 
     Federal law.
       ``(B) The Secretary and the heads of other agencies shall 
     streamline the review and permitting of transmission within 
     corridors designated under section 503 of the Federal Land 
     Policy and Management Act (43 U.S.C. 1763) by fully taking 
     into account prior analyses and decisions relating to the 
     corridors.
       ``(C) The document shall include consideration by the 
     relevant agencies of any applicable criteria or other matters 
     as required under applicable law.
       ``(6)(A) If any agency has denied a Federal authorization 
     required for a transmission facility, or has failed to act by 
     the deadline established by the Secretary pursuant to this 
     section for deciding whether to issue the authorization, the 
     applicant or any State in which the facility would be located 
     may file an appeal with the President, who shall, in 
     consultation with the affected agency, review the denial or 
     failure to take action on the pending application.
       ``(B) Based on the overall record and in consultation with 
     the affected agency, the President may--
       ``(i) issue the necessary authorization with any 
     appropriate conditions; or
       ``(ii) deny the application.
       ``(C) The President shall issue a decision not later than 
     90 days after the date of the filing of the appeal.
       ``(D) In making a decision under this paragraph, the 
     President shall comply with applicable requirements of 
     Federal law, including any requirements of--
       ``(i) the National Forest Management Act of 1976 (16 U.S.C. 
     472a et seq.);

[[Page 17891]]

       ``(ii) the Endangered Species Act of 1973 (16 U.S.C. 1531 
     et seq.);
       ``(iii) the Federal Water Pollution Control Act (33 U.S.C. 
     1251 et seq.);
       ``(iv) the National Environmental Policy Act of 1969 (42 
     U.S.C. 4321 et seq.); and
       ``(v) the Federal Land Policy and Management Act of 1976 
     (43 U.S.C. 1701 et seq.).
       ``(7)(A) Not later than 18 months after the date of 
     enactment of this section, the Secretary shall issue any 
     regulations necessary to implement this subsection.
       ``(B)(i) Not later than 1 year after the date of enactment 
     of this section, the Secretary and the heads of all Federal 
     agencies with authority to issue Federal authorizations shall 
     enter into a memorandum of understanding to ensure the timely 
     and coordinated review and permitting of electricity 
     transmission facilities.
       ``(ii) Interested Indian tribes, multistate entities, and 
     State agencies may enter the memorandum of understanding.
       ``(C) The head of each Federal agency with authority to 
     issue a Federal authorization shall designate a senior 
     official responsible for, and dedicate sufficient other staff 
     and resources to ensure, full implementation of the 
     regulations and memorandum required under this paragraph.
       ``(8)(A) Each Federal land use authorization for an 
     electricity transmission facility shall be issued--
       ``(i) for a duration, as determined by the Secretary, 
     commensurate with the anticipated use of the facility; and
       ``(ii) with appropriate authority to manage the right-of-
     way for reliability and environmental protection.
       ``(B) On the expiration of the authorization (including an 
     authorization issued before the date of enactment of this 
     section), the authorization shall be reviewed for renewal 
     taking fully into account reliance on such electricity 
     infrastructure, recognizing the importance of the 
     authorization for public health, safety, and economic welfare 
     and as a legitimate use of Federal land.
       ``(9) In exercising the responsibilities under this 
     section, the Secretary shall consult regularly with--
       ``(A) the Federal Energy Regulatory Commission;
       ``(B) electric reliability organizations (including related 
     regional entities) approved by the Commission; and
       ``(C) Transmission Organizations approved by the 
     Commission.
       ``(i) Interstate Compacts.--(1) The consent of Congress is 
     given for 3 or more contiguous States to enter into an 
     interstate compact, subject to approval by Congress, 
     establishing regional transmission siting agencies to--
       ``(A) facilitate siting of future electric energy 
     transmission facilities within those States; and
       ``(B) carry out the electric energy transmission siting 
     responsibilities of those States.
       ``(2) The Secretary may provide technical assistance to 
     regional transmission siting agencies established under this 
     subsection.
       ``(3) The regional transmission siting agencies shall have 
     the authority to review, certify, and permit siting of 
     transmission facilities, including facilities in national 
     interest electric transmission corridors (other than 
     facilities on property owned by the United States).
       ``(4) The Commission shall have no authority to issue a 
     permit for the construction or modification of an electric 
     transmission facility within a State that is a party to a 
     compact, unless the members of the compact are in 
     disagreement and the Secretary makes, after notice and an 
     opportunity for a hearing, the finding described in 
     subsection (b)(1)(C).
       ``(j) Relationship to Other Laws.--(1) Except as 
     specifically provided, nothing in this section affects any 
     requirement of an environmental law of the United States, 
     including the National Environmental Policy Act of 1969 (42 
     U.S.C. 4321 et seq.).
       ``(2) Subsection (h)(6) shall not apply to any unit of the 
     National Park System, the National Wildlife Refuge System, 
     the National Wild and Scenic Rivers System, the National 
     Trails System, the National Wilderness Preservation System, 
     or a National Monument.
       ``(k) ERCOT.--This section shall not apply within the area 
     referred to in section 212(k)(2)(A).''.
       (b) Reports to Congress on Corridors and Rights of Way on 
     Federal Lands.--Not later than 90 days after the date of 
     enactment of this Act, the Secretary of the Interior, the 
     Secretary, the Secretary of Agriculture, and the Chairman of 
     the Council on Environmental Quality shall submit to Congress 
     a joint report identifying--
       (1)(A) all existing designated transmission and 
     distribution corridors on Federal land and the status of work 
     related to proposed transmission and distribution corridor 
     designations under title V of the Federal Land Policy and 
     Management Act of 1976 (43 U.S.C. 1761 et seq.);
       (B) the schedule for completing the work;
       (C) any impediments to completing the work; and
       (D) steps that Congress could take to expedite the process;
       (2)(A) the number of pending applications to locate 
     transmission facilities on Federal land;
       (B) key information relating to each such facility;
       (C) how long each application has been pending;
       (D) the schedule for issuing a timely decision as to each 
     facility; and
       (E) progress in incorporating existing and new such rights-
     of-way into relevant land use and resource management plans 
     or the equivalent of those plans; and
       (3)(A) the number of existing transmission and distribution 
     rights-of-way on Federal land that will come up for renewal 
     within the following 5-, 10-, and 15-year periods; and
       (B) a description of how the Secretaries plan to manage the 
     renewals.

     SEC. 1222. THIRD-PARTY FINANCE.

       (a) Existing Facilities.--The Secretary, acting through the 
     Administrator of the Western Area Power Administration 
     (hereinafter in this section referred to as ``WAPA''), or 
     through the Administrator of the Southwestern Power 
     Administration (hereinafter in this section referred to as 
     ``SWPA''), or both, may design, develop, construct, operate, 
     maintain, or own, or participate with other entities in 
     designing, developing, constructing, operating, maintaining, 
     or owning, an electric power transmission facility and 
     related facilities (``Project'') needed to upgrade existing 
     transmission facilities owned by SWPA or WAPA if the 
     Secretary, in consultation with the applicable Administrator, 
     determines that the proposed Project--
       (1)(A) is located in a national interest electric 
     transmission corridor designated under section 216(a) of the 
     Federal Power Act and will reduce congestion of electric 
     transmission in interstate commerce; or
       (B) is necessary to accommodate an actual or projected 
     increase in demand for electric transmission capacity;
       (2) is consistent with--
       (A) transmission needs identified, in a transmission 
     expansion plan or otherwise, by the appropriate Transmission 
     Organization (as defined in the Federal Power Act), if any, 
     or approved regional reliability organization; and
       (B) efficient and reliable operation of the transmission 
     grid; and
       (3) would be operated in conformance with prudent utility 
     practice.
       (b) New Facilities.--The Secretary, acting through WAPA or 
     SWPA, or both, may design, develop, construct, operate, 
     maintain, or own, or participate with other entities in 
     designing, developing, constructing, operating, maintaining, 
     or owning, a new electric power transmission facility and 
     related facilities (``Project'') located within any State in 
     which WAPA or SWPA operates if the Secretary, in consultation 
     with the applicable Administrator, determines that the 
     proposed Project--
       (1)(A) is located in an area designated under section 
     216(a) of the Federal Power Act and will reduce congestion of 
     electric transmission in interstate commerce; or
       (B) is necessary to accommodate an actual or projected 
     increase in demand for electric transmission capacity;
       (2) is consistent with--
       (A) transmission needs identified, in a transmission 
     expansion plan or otherwise, by the appropriate Transmission 
     Organization (as defined in the Federal Power Act) if any, or 
     approved regional reliability organization; and
       (B) efficient and reliable operation of the transmission 
     grid;
       (3) will be operated in conformance with prudent utility 
     practice;
       (4) will be operated by, or in conformance with the rules 
     of, the appropriate (A) Transmission Organization, if any, or 
     (B) if such an organization does not exist, regional 
     reliability organization; and
       (5) will not duplicate the functions of existing 
     transmission facilities or proposed facilities which are the 
     subject of ongoing or approved siting and related permitting 
     proceedings.
       (c) Other Funds.--
       (1) In general.--In carrying out a Project under subsection 
     (a) or (b), the Secretary may accept and use funds 
     contributed by another entity for the purpose of carrying out 
     the Project.
       (2) Availability.--The contributed funds shall be available 
     for expenditure for the purpose of carrying out the Project--
       (A) without fiscal year limitation; and
       (B) as if the funds had been appropriated specifically for 
     that Project.
       (3) Allocation of costs.--In carrying out a Project under 
     subsection (a) or (b), any costs of the Project not paid for 
     by contributions from another entity shall be collected 
     through rates charged to customers using the new transmission 
     capability provided by the Project and allocated equitably 
     among these project beneficiaries using the new transmission 
     capability.
       (d) Relationship to Other Laws.--Nothing in this section 
     affects any requirement of--
       (1) any Federal environmental law, including the National 
     Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.);
       (2) any Federal or State law relating to the siting of 
     energy facilities; or
       (3) any existing authorizing statutes.
       (e) Savings Clause.--Nothing in this section shall 
     constrain or restrict an Administrator in the utilization of 
     other authority delegated to the Administrator of WAPA or 
     SWPA.
       (f) Secretarial Determinations.--Any determination made 
     pursuant to subsections (a) or (b) shall be based on findings 
     by the Secretary using the best available data.
       (g) Maximum Funding Amount.--The Secretary shall not accept 
     and use more than $100,000,000 under subsection (c)(1) for 
     the period encompassing fiscal years 2006 through 2015.

     SEC. 1223. ADVANCED TRANSMISSION TECHNOLOGIES.

       (a) Definition of Advanced Transmission Technology.--In 
     this section, the term ``advanced transmission technology'' 
     means a technology that increases the capacity, efficiency, 
     or reliability of an existing or new transmission facility, 
     including--

[[Page 17892]]

       (1) high-temperature lines (including superconducting 
     cables);
       (2) underground cables;
       (3) advanced conductor technology (including advanced 
     composite conductors, high-temperature low-sag conductors, 
     and fiber optic temperature sensing conductors);
       (4) high-capacity ceramic electric wire, connectors, and 
     insulators;
       (5) optimized transmission line configurations (including 
     multiple phased transmission lines);
       (6) modular equipment;
       (7) wireless power transmission;
       (8) ultra-high voltage lines;
       (9) high-voltage DC technology;
       (10) flexible AC transmission systems;
       (11) energy storage devices (including pumped hydro, 
     compressed air, superconducting magnetic energy storage, 
     flywheels, and batteries);
       (12) controllable load;
       (13) distributed generation (including PV, fuel cells, and 
     microturbines);
       (14) enhanced power device monitoring;
       (15) direct system state sensors;
       (16) fiber optic technologies;
       (17) power electronics and related software (including real 
     time monitoring and analytical software);
       (18) mobile transformers and mobile substations; and
       (19) any other technologies the Commission considers 
     appropriate.
       (b) Authority.--In carrying out the Federal Power Act (16 
     U.S.C. 791a et seq.) and the Public Utility Regulatory 
     Policies Act of 1978 (16 U.S.C. 2601 et seq.), the Commission 
     shall encourage, as appropriate, the deployment of advanced 
     transmission technologies.

     SEC. 1224. ADVANCED POWER SYSTEM TECHNOLOGY INCENTIVE 
                   PROGRAM.

       (a) Program.--The Secretary is authorized to establish an 
     Advanced Power System Technology Incentive Program to support 
     the deployment of certain advanced power system technologies 
     and to improve and protect certain critical governmental, 
     industrial, and commercial processes. Funds provided under 
     this section shall be used by the Secretary to make incentive 
     payments to eligible owners or operators of advanced power 
     system technologies to increase power generation through 
     enhanced operational, economic, and environmental 
     performance. Payments under this section may only be made 
     upon receipt by the Secretary of an incentive payment 
     application establishing an applicant as either--
       (1) a qualifying advanced power system technology facility; 
     or
       (2) a qualifying security and assured power facility.
       (b) Incentives.--Subject to availability of funds, a 
     payment of 1.8 cents per kilowatt-hour shall be paid to the 
     owner or operator of a qualifying advanced power system 
     technology facility under this section for electricity 
     generated at such facility. An additional 0.7 cents per 
     kilowatt-hour shall be paid to the owner or operator of a 
     qualifying security and assured power facility for 
     electricity generated at such facility. Any facility 
     qualifying under this section shall be eligible for an 
     incentive payment for up to, but not more than, the first 
     10,000,000 kilowatt-hours produced in any fiscal year.
       (c) Eligibility.--For purposes of this section:
       (1) Qualifying advanced power system technology facility.--
     The term ``qualifying advanced power system technology 
     facility'' means a facility using an advanced fuel cell, 
     turbine, or hybrid power system or power storage system to 
     generate or store electric energy.
       (2) Qualifying security and assured power facility.--The 
     term ``qualifying security and assured power facility'' means 
     a qualifying advanced power system technology facility 
     determined by the Secretary, in consultation with the 
     Secretary of Homeland Security, to be in critical need of 
     secure, reliable, rapidly available, high-quality power for 
     critical governmental, industrial, or commercial 
     applications.
       (d) Authorization.--There are authorized to be appropriated 
     to the Secretary for the purposes of this section, 
     $10,000,000 for each of the fiscal years 2006 through 2012.
            Subtitle C--Transmission Operation Improvements

     SEC. 1231. OPEN NONDISCRIMINATORY ACCESS.

       Part II of the Federal Power Act (16 U.S.C. 824 et seq.) is 
     amended by inserting after section 211 (16 U.S.C. 824j) the 
     following:

     ``SEC. 211A. OPEN ACCESS BY UNREGULATED TRANSMITTING 
                   UTILITIES.

       ``(a) Definition of Unregulated Transmitting Utility.--In 
     this section, the term `unregulated transmitting utility' 
     means an entity that--
       ``(1) owns or operates facilities used for the transmission 
     of electric energy in interstate commerce; and
       ``(2) is an entity described in section 201(f).
       ``(b) Transmission Operation Services.--Subject to section 
     212(h), the Commission may, by rule or order, require an 
     unregulated transmitting utility to provide transmission 
     services--
       ``(1) at rates that are comparable to those that the 
     unregulated transmitting utility charges itself; and
       ``(2) on terms and conditions (not relating to rates) that 
     are comparable to those under which the unregulated 
     transmitting utility provides transmission services to itself 
     and that are not unduly discriminatory or preferential.
       ``(c) Exemption.--The Commission shall exempt from any rule 
     or order under this section any unregulated transmitting 
     utility that--
       ``(1) sells not more than 4,000,000 megawatt hours of 
     electricity per year;
       ``(2) does not own or operate any transmission facilities 
     that are necessary for operating an interconnected 
     transmission system (or any portion of the system); or
       ``(3) meets other criteria the Commission determines to be 
     in the public interest.
       ``(d) Local Distribution Facilities.--The requirements of 
     subsection (b) shall not apply to facilities used in local 
     distribution.
       ``(e) Exemption Termination.--If the Commission, after an 
     evidentiary hearing held on a complaint and after giving 
     consideration to reliability standards established under 
     section 215, finds on the basis of a preponderance of the 
     evidence that any exemption granted pursuant to subsection 
     (c) unreasonably impairs the continued reliability of an 
     interconnected transmission system, the Commission shall 
     revoke the exemption granted to the transmitting utility.
       ``(f) Application to Unregulated Transmitting Utilities.--
     The rate changing procedures applicable to public utilities 
     under subsections (c) and (d) of section 205 are applicable 
     to unregulated transmitting utilities for purposes of this 
     section.
       ``(g) Remand.--In exercising authority under subsection 
     (b)(1), the Commission may remand transmission rates to an 
     unregulated transmitting utility for review and revision if 
     necessary to meet the requirements of subsection (b).
       ``(h) Other Requests.--The provision of transmission 
     services under subsection (b) does not preclude a request for 
     transmission services under section 211.
       ``(i) Limitation.--The Commission may not require a State 
     or municipality to take action under this section that would 
     violate a private activity bond rule for purposes of section 
     141 of the Internal Revenue Code of 1986.
       ``(j) Transfer of Control of Transmitting Facilities.--
     Nothing in this section authorizes the Commission to require 
     an unregulated transmitting utility to transfer control or 
     operational control of its transmitting facilities to a 
     Transmission Organization that is designated to provide 
     nondiscriminatory transmission access.''.

     SEC. 1232. FEDERAL UTILITY PARTICIPATION IN TRANSMISSION 
                   ORGANIZATIONS.

       (a) Definitions.--In this section:
       (1) Appropriate federal regulatory authority.--The term 
     ``appropriate Federal regulatory authority'' means--
       (A) in the case of a Federal power marketing agency, the 
     Secretary, except that the Secretary may designate the 
     Administrator of a Federal power marketing agency to act as 
     the appropriate Federal regulatory authority with respect to 
     the transmission system of the Federal power marketing 
     agency; and
       (B) in the case of the Tennessee Valley Authority, the 
     Board of Directors of the Tennessee Valley Authority.
       (2) Federal power marketing agency.--The term ``Federal 
     power marketing agency'' has the meaning given the term in 
     section 3 of the Federal Power Act (16 U.S.C. 796).
       (3) Federal utility.--The term ``Federal utility'' means--
       (A) a Federal power marketing agency; or
       (B) the Tennessee Valley Authority.
       (4) Transmission organization.--The term ``Transmission 
     Organization'' has the meaning given the term in section 3 of 
     the Federal Power Act (16 U.S.C. 796).
       (5) Transmission system.--The term ``transmission system'' 
     means an electric transmission facility owned, leased, or 
     contracted for by the United States and operated by a Federal 
     utility.
       (b) Transfer.--The appropriate Federal regulatory authority 
     may enter into a contract, agreement, or other arrangement 
     transferring control and use of all or part of the 
     transmission system of a Federal utility to a Transmission 
     Organization.
       (c) Contents.--The contract, agreement, or arrangement 
     shall include--
       (1) performance standards for operation and use of the 
     transmission system that the head of the Federal utility 
     determines are necessary or appropriate, including standards 
     that ensure--
       (A) recovery of all of the costs and expenses of the 
     Federal utility related to the transmission facilities that 
     are the subject of the contract, agreement, or other 
     arrangement;
       (B) consistency with existing contracts and third-party 
     financing arrangements; and
       (C) consistency with the statutory authorities, 
     obligations, and limitations of the Federal utility;
       (2) provisions for monitoring and oversight by the Federal 
     utility of the Transmission Organization's terms and 
     conditions of the contract, agreement, or other arrangement, 
     including a provision for the resolution of disputes through 
     arbitration or other means with the Transmission Organization 
     or with other participants, notwithstanding the obligations 
     and limitations of any other law regarding arbitration; and
       (3) a provision that allows the Federal utility to withdraw 
     from the Transmission Organization and terminate the 
     contract, agreement, or other arrangement in accordance with 
     its terms.
       (d) Commission.--Neither this section, actions taken 
     pursuant to this section, nor any other transaction of a 
     Federal utility participating in a Transmission Organization 
     shall confer on the Commission jurisdiction or authority 
     over--
       (1) the electric generation assets, electric capacity, or 
     energy of the Federal utility that the Federal utility is 
     authorized by law to market; or
       (2) the power sales activities of the Federal utility.
       (e) Existing Statutory and Other Obligations.--
       (1) System operation requirements.--No statutory provision 
     requiring or authorizing a

[[Page 17893]]

     Federal utility to transmit electric power or to construct, 
     operate, or maintain the transmission system of the Federal 
     utility prohibits a transfer of control and use of the 
     transmission system pursuant to, and subject to, the 
     requirements of this section.
       (2) Other obligations.--This subsection does not--
       (A) suspend, or exempt any Federal utility from, any 
     provision of Federal law in effect on the date of enactment 
     of this Act, including any requirement or direction relating 
     to the use of the transmission system of the Federal utility, 
     environmental protection, fish and wildlife protection, flood 
     control, navigation, water delivery, or recreation; or
       (B) authorize abrogation of any contract or treaty 
     obligation.
       (3) Conforming amendment.--Section 311 of the Energy and 
     Water Development Appropriations Act, 2001 (16 U.S.C. 824n) 
     is repealed.

     SEC. 1233. NATIVE LOAD SERVICE OBLIGATION.

       (a) In General.--Part II of the Federal Power Act (16 
     U.S.C. 824 et seq.) is amended by adding at the end the 
     following:

     ``SEC. 217. NATIVE LOAD SERVICE OBLIGATION.

       ``(a) Definitions.--In this section:
       ``(1) The term `distribution utility' means an electric 
     utility that has a service obligation to end-users or to a 
     State utility or electric cooperative that, directly or 
     indirectly, through 1 or more additional State utilities or 
     electric cooperatives, provides electric service to end-
     users.
       ``(2) The term `load-serving entity' means a distribution 
     utility or an electric utility that has a service obligation.
       ``(3) The term `service obligation' means a requirement 
     applicable to, or the exercise of authority granted to, an 
     electric utility under Federal, State, or local law or under 
     long-term contracts to provide electric service to end-users 
     or to a distribution utility.
       ``(4) The term `State utility' means a State or any 
     political subdivision of a State, or any agency, authority, 
     or instrumentality of any 1 or more of the foregoing, or a 
     corporation that is wholly owned, directly or indirectly, by 
     any 1 or more of the foregoing, competent to carry on the 
     business of developing, transmitting, utilizing, or 
     distributing power.
       ``(b) Meeting Service Obligations.--(1) Paragraph (2) 
     applies to any load-serving entity that, as of the date of 
     enactment of this section--
       ``(A) owns generation facilities, markets the output of 
     Federal generation facilities, or holds rights under 1 or 
     more wholesale contracts to purchase electric energy, for the 
     purpose of meeting a service obligation; and
       ``(B) by reason of ownership of transmission facilities, or 
     1 or more contracts or service agreements for firm 
     transmission service, holds firm transmission rights for 
     delivery of the output of the generation facilities or the 
     purchased energy to meet the service obligation.
       ``(2) Any load-serving entity described in paragraph (1) is 
     entitled to use the firm transmission rights, or, equivalent 
     tradable or financial transmission rights, in order to 
     deliver the output or purchased energy, or the output of 
     other generating facilities or purchased energy to the extent 
     deliverable using the rights, to the extent required to meet 
     the service obligation of the load-serving entity.
       ``(3)(A) To the extent that all or a portion of the service 
     obligation covered by the firm transmission rights or 
     equivalent tradable or financial transmission rights is 
     transferred to another load-serving entity, the successor 
     load-serving entity shall be entitled to use the firm 
     transmission rights or equivalent tradable or financial 
     transmission rights associated with the transferred service 
     obligation.
       ``(B) Subsequent transfers to another load-serving entity, 
     or back to the original load-serving entity, shall be 
     entitled to the same rights.
       ``(4) The Commission shall exercise the authority of the 
     Commission under this Act in a manner that facilitates the 
     planning and expansion of transmission facilities to meet the 
     reasonable needs of load-serving entities to satisfy the 
     service obligations of the load-serving entities, and enables 
     load-serving entities to secure firm transmission rights (or 
     equivalent tradable or financial rights) on a long term basis 
     for long term power supply arrangements made, or planned, to 
     meet such needs.
       ``(c) Allocation of Transmission Rights.--Nothing in 
     subsections (b)(1), (b)(2) and (b)(3) of this section shall 
     affect any existing or future methodology employed by a 
     Transmission Organization for allocating or auctioning 
     transmission rights if such Transmission Organization was 
     authorized by the Commission to allocate or auction financial 
     transmission rights on its system as of January 1, 2005, and 
     the Commission determines that any future allocation or 
     auction is just, reasonable and not unduly discriminatory or 
     preferential, provided, however, that if such a Transmission 
     Organization never allocated financial transmission rights on 
     its system that pertained to a period before January 1, 2005, 
     with respect to any application by such Transmission 
     Organization that would change its methodology the Commission 
     shall exercise its authority in a manner consistent with the 
     Act and that takes into account the policies expressed in 
     subsections (b)(1), (b)(2) and (b)(3) as applied to firm 
     transmission rights held by a load-serving entity as of 
     January 1, 2005, to the extent the associated generation 
     ownership or power purchase arrangements remain in effect.
       ``(d) Certain Transmission Rights.--The Commission may 
     exercise authority under this Act to make transmission rights 
     not used to meet an obligation covered by subsection (b) 
     available to other entities in a manner determined by the 
     Commission to be just, reasonable, and not unduly 
     discriminatory or preferential.
       ``(e) Obligation to Build.--Nothing in this Act relieves a 
     load-serving entity from any obligation under State or local 
     law to build transmission or distribution facilities adequate 
     to meet the service obligations of the load-serving entity.
       ``(f) Contracts.--Nothing in this section shall provide a 
     basis for abrogating any contract or service agreement for 
     firm transmission service or rights in effect as of the date 
     of the enactment of this subsection. If an ISO in the Western 
     Interconnection had allocated financial transmission rights 
     prior to the date of enactment of this section but had not 
     done so with respect to one or more load-serving entities' 
     firm transmission rights held under contracts to which the 
     preceding sentence applies (or held by reason of ownership or 
     future ownership of transmission facilities), such load-
     serving entities may not be required, without their consent, 
     to convert such firm transmission rights to tradable or 
     financial rights, except where the load-serving entity has 
     voluntarily joined the ISO as a participating transmission 
     owner (or its successor) in accordance with the ISO tariff.
       ``(g) Water Pumping Facilities.--The Commission shall 
     ensure that any entity described in section 201(f) that owns 
     transmission facilities used predominately to support its own 
     water pumping facilities shall have, with respect to the 
     facilities, protections for transmission service comparable 
     to those provided to load-serving entities pursuant to this 
     section.
       ``(h) ERCOT.--This section shall not apply within the area 
     referred to in section 212(k)(2)(A).
       ``(i) Jurisdiction.--This section does not authorize the 
     Commission to take any action not otherwise within the 
     jurisdiction of the Commission.
       ``(j) TVA Area.--(1) Subject to paragraphs (2) and (3), for 
     purposes of subsection (b)(1)(B), a load-serving entity that 
     is located within the service area of the Tennessee Valley 
     Authority and that has a firm wholesale power supply contract 
     with the Tennessee Valley Authority shall be considered to 
     hold firm transmission rights for the transmission of the 
     power provided.
       ``(2) Nothing in this subsection affects the requirements 
     of section 212(j).
       ``(3) The Commission shall not issue an order on the basis 
     of this subsection that is contrary to the purposes of 
     section 212(j).
       ``(k) Effect of Exercising Rights.--An entity that to the 
     extent required to meet its service obligations exercises 
     rights described in subsection (b) shall not be considered by 
     such action as engaging in undue discrimination or preference 
     under this Act''.
       (b) FERC Rulemaking on Long-Term Transmission Rights in 
     Organized Markets.--Within one year after the date of 
     enactment of this section and after notice and an opportunity 
     for comment, the Commission shall by rule or order, implement 
     section 217(b)(4) of the Federal Power Act in Transmission 
     Organizations, as defined by that Act with organized 
     electricity markets.

     SEC. 1234. STUDY ON THE BENEFITS OF ECONOMIC DISPATCH.

       (a) Study.--The Secretary, in coordination and consultation 
     with the States, shall conduct a study on--
       (1) the procedures currently used by electric utilities to 
     perform economic dispatch;
       (2) identifying possible revisions to those procedures to 
     improve the ability of nonutility generation resources to 
     offer their output for sale for the purpose of inclusion in 
     economic dispatch; and
       (3) the potential benefits to residential, commercial, and 
     industrial electricity consumers nationally and in each state 
     if economic dispatch procedures were revised to improve the 
     ability of nonutility generation resources to offer their 
     output for inclusion in economic dispatch.
       (b) Definition.--The term ``economic dispatch'' when used 
     in this section means the operation of generation facilities 
     to produce energy at the lowest cost to reliably serve 
     consumers, recognizing any operational limits of generation 
     and transmission facilities.
       (c) Report to Congress and the States.--Not later than 90 
     days after the date of enactment of this Act, and on a yearly 
     basis following, the Secretary shall submit a report to 
     Congress and the States on the results of the study conducted 
     under subsection (a), including recommendations to Congress 
     and the States for any suggested legislative or regulatory 
     changes.

     SEC. 1235. PROTECTION OF TRANSMISSION CONTRACTS IN THE 
                   PACIFIC NORTHWEST.

       Part II of the Federal Power Act (16 U.S.C. 824 et seq.) is 
     amended by adding at the end the following:

     ``SEC. 218. PROTECTION OF TRANSMISSION CONTRACTS IN THE 
                   PACIFIC NORTHWEST.

       ``(a) Definition of Electric Utility or Person.--In this 
     section, the term `electric utility or person' means an 
     electric utility or person that--
       ``(1) as of the date of enactment of the Energy Policy Act 
     of 2005 holds firm transmission rights pursuant to contract 
     or by reason of ownership of transmission facilities; and
       ``(2) is located--
       ``(A) in the Pacific Northwest, as that region is defined 
     in section 3 of the Pacific Northwest Electric Power Planning 
     and Conservation Act (16 U.S.C. 839a); or
       ``(B) in that portion of a State included in the geographic 
     area proposed for a regional transmission organization in 
     Commission Docket

[[Page 17894]]

     Number RT01-35 on the date on which that docket was opened.
       ``(b) Protection of Transmission Contracts.--Nothing in 
     this Act confers on the Commission the authority to require 
     an electric utility or person to convert to tradable or 
     financial rights--
       ``(1) firm transmission rights described in subsection (a); 
     or
       ``(2) firm transmission rights obtained by exercising 
     contract or tariff rights associated with the firm 
     transmission rights described in subsection (a).''.

     SEC. 1236. SENSE OF CONGRESS REGARDING LOCATIONAL INSTALLED 
                   CAPACITY MECHANISM.

       (a) Findings.--Congress finds that--
       (1) in regard to a proposal to develop and implement a 
     specific type of locational installed capacity mechanism in 
     New England pending before the Federal Energy Regulatory 
     Commission; and
       (2) the Governors of the States have objected to the 
     proposed mechanism, arguing that the mechanism--
       (A) would not provide adequate assurance that necessary 
     electric generation capacity or reliability will be provided; 
     and
       (B) would impose a high cost on consumers and have a 
     significant negative economic impact.
       (b) Sense of Congress.--Congress--
       (1) notes the concerns of the New England States to the 
     proposed mechanism; and
       (2) declares that it is the sense of Congress that the 
     Federal Energy Regulatory Commission should carefully 
     consider the States' objections.
                  Subtitle D--Transmission Rate Reform

     SEC. 1241. TRANSMISSION INFRASTRUCTURE INVESTMENT.

       Part II of the Federal Power Act (16 U.S.C. 824 et seq.) is 
     amended by adding at the end the following:

     ``SEC. 219. TRANSMISSION INFRASTRUCTURE INVESTMENT.

       ``(a) Rulemaking Requirement.--Not later than 1 year after 
     the date of enactment of this section, the Commission shall 
     establish, by rule, incentive-based (including performance-
     based) rate treatments for the transmission of electric 
     energy in interstate commerce by public utilities for the 
     purpose of benefitting consumers by ensuring reliability and 
     reducing the cost of delivered power by reducing transmission 
     congestion.
       ``(b) Contents.--The rule shall--
       ``(1) promote reliable and economically efficient 
     transmission and generation of electricity by promoting 
     capital investment in the enlargement, improvement, 
     maintenance, and operation of all facilities for the 
     transmission of electric energy in interstate commerce, 
     regardless of the ownership of the facilities;
       ``(2) provide a return on equity that attracts new 
     investment in transmission facilities (including related 
     transmission technologies);
       ``(3) encourage deployment of transmission technologies and 
     other measures to increase the capacity and efficiency of 
     existing transmission facilities and improve the operation of 
     the facilities; and
       ``(4) allow recovery of--
       ``(A) all prudently incurred costs necessary to comply with 
     mandatory reliability standards issued pursuant to section 
     215; and
       ``(B) all prudently incurred costs related to transmission 
     infrastructure development pursuant to section 216.
       ``(c) Incentives.--In the rule issued under this section, 
     the Commission shall, to the extent within its jurisdiction, 
     provide for incentives to each transmitting utility or 
     electric utility that joins a Transmission Organization. The 
     Commission shall ensure that any costs recoverable pursuant 
     to this subsection may be recovered by such utility through 
     the transmission rates charged by such utility or through the 
     transmission rates charged by the Transmission Organization 
     that provides transmission service to such utility.
       ``(d) Just and Reasonable Rates.--All rates approved under 
     the rules adopted pursuant to this section, including any 
     revisions to the rules, are subject to the requirements of 
     sections 205 and 206 that all rates, charges, terms, and 
     conditions be just and reasonable and not unduly 
     discriminatory or preferential.''.

     SEC. 1242. FUNDING NEW INTERCONNECTION AND TRANSMISSION 
                   UPGRADES.

       The Commission may approve a participant funding plan that 
     allocates costs related to transmission upgrades or new 
     generator interconnection, without regard to whether an 
     applicant is a member of a Commission-approved Transmission 
     Organization, if the plan results in rates that--
       (1) are just and reasonable;
       (2) are not unduly discriminatory or preferential; and
       (3) are otherwise consistent with sections 205 and 206 of 
     the Federal Power Act (16 U.S.C. 824d, 824e).
                    Subtitle E--Amendments to PURPA

     SEC. 1251. NET METERING AND ADDITIONAL STANDARDS.

       (a) Adoption of Standards.--Section 111(d) of the Public 
     Utility Regulatory Policies Act of 1978 (16 U.S.C. 2621(d)) 
     is amended by adding at the end the following:
       ``(11) Net metering.--Each electric utility shall make 
     available upon request net metering service to any electric 
     consumer that the electric utility serves. For purposes of 
     this paragraph, the term `net metering service' means service 
     to an electric consumer under which electric energy generated 
     by that electric consumer from an eligible on-site generating 
     facility and delivered to the local distribution facilities 
     may be used to offset electric energy provided by the 
     electric utility to the electric consumer during the 
     applicable billing period.
       ``(12) Fuel sources.--Each electric utility shall develop a 
     plan to minimize dependence on 1 fuel source and to ensure 
     that the electric energy it sells to consumers is generated 
     using a diverse range of fuels and technologies, including 
     renewable technologies.
       ``(13) Fossil fuel generation efficiency.--Each electric 
     utility shall develop and implement a 10-year plan to 
     increase the efficiency of its fossil fuel generation.''.
       (b) Compliance.--
       (1) Time limitations.--Section 112(b) of the Public Utility 
     Regulatory Policies Act of 1978 (16 U.S.C. 2622(b)) is 
     amended by adding at the end the following:
       ``(3)(A) Not later than 2 years after the enactment of this 
     paragraph, each State regulatory authority (with respect to 
     each electric utility for which it has ratemaking authority) 
     and each nonregulated electric utility shall commence the 
     consideration referred to in section 111, or set a hearing 
     date for such consideration, with respect to each standard 
     established by paragraphs (11) through (13) of section 
     111(d).
       ``(B) Not later than 3 years after the date of the 
     enactment of this paragraph, each State regulatory authority 
     (with respect to each electric utility for which it has 
     ratemaking authority), and each nonregulated electric 
     utility, shall complete the consideration, and shall make the 
     determination, referred to in section 111 with respect to 
     each standard established by paragraphs (11) through (13) of 
     section 111(d).''.
       (2) Failure to comply.--Section 112(c) of the Public 
     Utility Regulatory Policies Act of 1978 (16 U.S.C. 2622(c)) 
     is amended by adding at the end the following: ``In the case 
     of each standard established by paragraphs (11) through (13) 
     of section 111(d), the reference contained in this subsection 
     to the date of enactment of this Act shall be deemed to be a 
     reference to the date of enactment of such paragraphs (11) 
     through (13).'' .
       (3) Prior state actions.--
       (A) In general.--Section 112 of the Public Utility 
     Regulatory Policies Act of 1978 (16 U.S.C. 2622) is amended 
     by adding at the end the following:
       ``(d) Prior State Actions.--Subsections (b) and (c) of this 
     section shall not apply to the standards established by 
     paragraphs (11) through (13) of section 111(d) in the case of 
     any electric utility in a State if, before the enactment of 
     this subsection--
       ``(1) the State has implemented for such utility the 
     standard concerned (or a comparable standard);
       ``(2) the State regulatory authority for such State or 
     relevant nonregulated electric utility has conducted a 
     proceeding to consider implementation of the standard 
     concerned (or a comparable standard) for such utility; or
       ``(3) the State legislature has voted on the implementation 
     of such standard (or a comparable standard) for such 
     utility.''.
       (B) Cross reference.--Section 124 of such Act (16 U.S.C. 
     2634) is amended by adding the following at the end thereof: 
     ``In the case of each standard established by paragraphs (11) 
     through (13) of section 111(d), the reference contained in 
     this subsection to the date of enactment of this Act shall be 
     deemed to be a reference to the date of enactment of such 
     paragraphs (11) through (13).''.

     SEC. 1252. SMART METERING.

       (a) In General.--Section 111(d) of the Public Utility 
     Regulatory Policies Act of 1978 (16 U.S.C. 2621(d)) is 
     amended by adding at the end the following:
       ``(14) Time-based metering and communications.--(A) Not 
     later than 18 months after the date of enactment of this 
     paragraph, each electric utility shall offer each of its 
     customer classes, and provide individual customers upon 
     customer request, a time-based rate schedule under which the 
     rate charged by the electric utility varies during different 
     time periods and reflects the variance, if any, in the 
     utility's costs of generating and purchasing electricity at 
     the wholesale level. The time-based rate schedule shall 
     enable the electric consumer to manage energy use and cost 
     through advanced metering and communications technology.
       ``(B) The types of time-based rate schedules that may be 
     offered under the schedule referred to in subparagraph (A) 
     include, among others--
       ``(i) time-of-use pricing whereby electricity prices are 
     set for a specific time period on an advance or forward 
     basis, typically not changing more often than twice a year, 
     based on the utility's cost of generating and/or purchasing 
     such electricity at the wholesale level for the benefit of 
     the consumer. Prices paid for energy consumed during these 
     periods shall be pre-established and known to consumers in 
     advance of such consumption, allowing them to vary their 
     demand and usage in response to such prices and manage their 
     energy costs by shifting usage to a lower cost period or 
     reducing their consumption overall;
       ``(ii) critical peak pricing whereby time-of-use prices are 
     in effect except for certain peak days, when prices may 
     reflect the costs of generating and/or purchasing electricity 
     at the wholesale level and when consumers may receive 
     additional discounts for reducing peak period energy 
     consumption;
       ``(iii) real-time pricing whereby electricity prices are 
     set for a specific time period on an advanced or forward 
     basis, reflecting the utility's cost of generating and/or 
     purchasing electricity at the wholesale level, and may change 
     as often as hourly; and

[[Page 17895]]

       ``(iv) credits for consumers with large loads who enter 
     into pre-established peak load reduction agreements that 
     reduce a utility's planned capacity obligations.
       ``(C) Each electric utility subject to subparagraph (A) 
     shall provide each customer requesting a time-based rate with 
     a time-based meter capable of enabling the utility and 
     customer to offer and receive such rate, respectively.
       ``(D) For purposes of implementing this paragraph, any 
     reference contained in this section to the date of enactment 
     of the Public Utility Regulatory Policies Act of 1978 shall 
     be deemed to be a reference to the date of enactment of this 
     paragraph.
       ``(E) In a State that permits third-party marketers to sell 
     electric energy to retail electric consumers, such consumers 
     shall be entitled to receive the same time-based metering and 
     communications device and service as a retail electric 
     consumer of the electric utility.
       ``(F) Notwithstanding subsections (b) and (c) of section 
     112, each State regulatory authority shall, not later than 18 
     months after the date of enactment of this paragraph conduct 
     an investigation in accordance with section 115(i) and issue 
     a decision whether it is appropriate to implement the 
     standards set out in subparagraphs (A) and (C).''.
       (b) State Investigation of Demand Response and Time-Based 
     Metering.--Section 115 of the Public Utility Regulatory 
     Policies Act of 1978 (16 U.S.C. 2625) is amended as follows:
       (1) By inserting in subsection (b) after the phrase ``the 
     standard for time-of-day rates established by section 
     111(d)(3)'' the following: ``and the standard for time-based 
     metering and communications established by section 
     111(d)(14)''.
       (2) By inserting in subsection (b) after the phrase ``are 
     likely to exceed the metering'' the following: ``and 
     communications''.
       (3) By adding the at the end the following:
       ``(i) Time-Based Metering and Communications.--In making a 
     determination with respect to the standard established by 
     section 111(d)(14), the investigation requirement of section 
     111(d)(14)(F) shall be as follows: Each State regulatory 
     authority shall conduct an investigation and issue a decision 
     whether or not it is appropriate for electric utilities to 
     provide and install time-based meters and communications 
     devices for each of their customers which enable such 
     customers to participate in time-based pricing rate schedules 
     and other demand response programs.''.
       (c) Federal Assistance on Demand Response.--Section 132(a) 
     of the Public Utility Regulatory Policies Act of 1978 (16 
     U.S.C. 2642(a)) is amended by striking ``and'' at the end of 
     paragraph (3), striking the period at the end of paragraph 
     (4) and inserting ``; and'', and by adding the following at 
     the end thereof:
       ``(5) technologies, techniques, and rate-making methods 
     related to advanced metering and communications and the use 
     of these technologies, techniques and methods in demand 
     response programs.''.
       (d) Federal Guidance.--Section 132 of the Public Utility 
     Regulatory Policies Act of 1978 (16 U.S.C. 2642) is amended 
     by adding the following at the end thereof:
       ``(d) Demand Response.--The Secretary shall be responsible 
     for--
       ``(1) educating consumers on the availability, advantages, 
     and benefits of advanced metering and communications 
     technologies, including the funding of demonstration or pilot 
     projects;
       ``(2) working with States, utilities, other energy 
     providers and advanced metering and communications experts to 
     identify and address barriers to the adoption of demand 
     response programs; and
       ``(3) not later than 180 days after the date of enactment 
     of the Energy Policy Act of 2005, providing Congress with a 
     report that identifies and quantifies the national benefits 
     of demand response and makes a recommendation on achieving 
     specific levels of such benefits by January 1, 2007.''.
       (e) Demand Response and Regional Coordination.--
       (1) In general.--It is the policy of the United States to 
     encourage States to coordinate, on a regional basis, State 
     energy policies to provide reliable and affordable demand 
     response services to the public.
       (2) Technical assistance.--The Secretary shall provide 
     technical assistance to States and regional organizations 
     formed by 2 or more States to assist them in--
       (A) identifying the areas with the greatest demand response 
     potential;
       (B) identifying and resolving problems in transmission and 
     distribution networks, including through the use of demand 
     response;
       (C) developing plans and programs to use demand response to 
     respond to peak demand or emergency needs; and
       (D) identifying specific measures consumers can take to 
     participate in these demand response programs.
       (3) Report.--Not later than 1 year after the date of 
     enactment of the Energy Policy Act of 2005, the Commission 
     shall prepare and publish an annual report, by appropriate 
     region, that assesses demand response resources, including 
     those available from all consumer classes, and which 
     identifies and reviews--
       (A) saturation and penetration rate of advanced meters and 
     communications technologies, devices and systems;
       (B) existing demand response programs and time-based rate 
     programs;
       (C) the annual resource contribution of demand resources;
       (D) the potential for demand response as a quantifiable, 
     reliable resource for regional planning purposes;
       (E) steps taken to ensure that, in regional transmission 
     planning and operations, demand resources are provided 
     equitable treatment as a quantifiable, reliable resource 
     relative to the resource obligations of any load-serving 
     entity, transmission provider, or transmitting party; and
       (F) regulatory barriers to improved customer participation 
     in demand response, peak reduction and critical period 
     pricing programs.
       (f) Federal Encouragement of Demand Response Devices.--It 
     is the policy of the United States that time-based pricing 
     and other forms of demand response, whereby electricity 
     customers are provided with electricity price signals and the 
     ability to benefit by responding to them, shall be 
     encouraged, the deployment of such technology and devices 
     that enable electricity customers to participate in such 
     pricing and demand response systems shall be facilitated, and 
     unnecessary barriers to demand response participation in 
     energy, capacity and ancillary service markets shall be 
     eliminated. It is further the policy of the United States 
     that the benefits of such demand response that accrue to 
     those not deploying such technology and devices, but who are 
     part of the same regional electricity entity, shall be 
     recognized.
       (g) Time Limitations.--Section 112(b) of the Public Utility 
     Regulatory Policies Act of 1978 (16 U.S.C. 2622(b)) is 
     amended by adding at the end the following:
       ``(4)(A) Not later than 1 year after the enactment of this 
     paragraph, each State regulatory authority (with respect to 
     each electric utility for which it has ratemaking authority) 
     and each nonregulated electric utility shall commence the 
     consideration referred to in section 111, or set a hearing 
     date for such consideration, with respect to the standard 
     established by paragraph (14) of section 111(d).
       ``(B) Not later than 2 years after the date of the 
     enactment of this paragraph, each State regulatory authority 
     (with respect to each electric utility for which it has 
     ratemaking authority), and each nonregulated electric 
     utility, shall complete the consideration, and shall make the 
     determination, referred to in section 111 with respect to the 
     standard established by paragraph (14) of section 111(d).''.
       (h) Failure to Comply.--Section 112(c) of the Public 
     Utility Regulatory Policies Act of 1978 (16 U.S.C. 2622(c)) 
     is amended by adding at the end the following:
       ``In the case of the standard established by paragraph (14) 
     of section 111(d), the reference contained in this subsection 
     to the date of enactment of this Act shall be deemed to be a 
     reference to the date of enactment of such paragraph (14).''.
       (i) Prior State Actions Regarding Smart Metering 
     Standards.--
       (1) In general.--Section 112 of the Public Utility 
     Regulatory Policies Act of 1978 (16 U.S.C. 2622) is amended 
     by adding at the end the following:
       ``(e) Prior State Actions.--Subsections (b) and (c) of this 
     section shall not apply to the standard established by 
     paragraph (14) of section 111(d) in the case of any electric 
     utility in a State if, before the enactment of this 
     subsection--
       ``(1) the State has implemented for such utility the 
     standard concerned (or a comparable standard);
       ``(2) the State regulatory authority for such State or 
     relevant nonregulated electric utility has conducted a 
     proceeding to consider implementation of the standard 
     concerned (or a comparable standard) for such utility within 
     the previous 3 years; or
       ``(3) the State legislature has voted on the implementation 
     of such standard (or a comparable standard) for such utility 
     within the previous 3 years.''.
       (2) Cross reference.--Section 124 of such Act (16 U.S.C. 
     2634) is amended by adding the following at the end thereof: 
     ``In the case of the standard established by paragraph (14) 
     of section 111(d), the reference contained in this subsection 
     to the date of enactment of this Act shall be deemed to be a 
     reference to the date of enactment of such paragraph (14).''.

     SEC. 1253. COGENERATION AND SMALL POWER PRODUCTION PURCHASE 
                   AND SALE REQUIREMENTS.

       (a) Termination of Mandatory Purchase and Sale 
     Requirements.--Section 210 of the Public Utility Regulatory 
     Policies Act of 1978 (16 U.S.C. 824a-3) is amended by adding 
     at the end the following:
       ``(m) Termination of Mandatory Purchase and Sale 
     Requirements.--
       ``(1) Obligation to purchase.--After the date of enactment 
     of this subsection, no electric utility shall be required to 
     enter into a new contract or obligation to purchase electric 
     energy from a qualifying cogeneration facility or a 
     qualifying small power production facility under this section 
     if the Commission finds that the qualifying cogeneration 
     facility or qualifying small power production facility has 
     nondiscriminatory access to--
       ``(A)(i) independently administered, auction-based day 
     ahead and real time wholesale markets for the sale of 
     electric energy; and (ii) wholesale markets for long-term 
     sales of capacity and electric energy; or
       ``(B)(i) transmission and interconnection services that are 
     provided by a Commission-approved regional transmission 
     entity and administered pursuant to an open access 
     transmission tariff that affords nondiscriminatory treatment 
     to all customers; and (ii) competitive wholesale markets that 
     provide a meaningful opportunity

[[Page 17896]]

     to sell capacity, including long-term and short-term sales, 
     and electric energy, including long-term, short-term and 
     real-time sales, to buyers other than the utility to which 
     the qualifying facility is interconnected. In determining 
     whether a meaningful opportunity to sell exists, the 
     Commission shall consider, among other factors, evidence of 
     transactions within the relevant market; or
       ``(C) wholesale markets for the sale of capacity and 
     electric energy that are, at a minimum, of comparable 
     competitive quality as markets described in subparagraphs (A) 
     and (B).
       ``(2) Revised purchase and sale obligation for new 
     facilities.--(A) After the date of enactment of this 
     subsection, no electric utility shall be required pursuant to 
     this section to enter into a new contract or obligation to 
     purchase from or sell electric energy to a facility that is 
     not an existing qualifying cogeneration facility unless the 
     facility meets the criteria for qualifying cogeneration 
     facilities established by the Commission pursuant to the 
     rulemaking required by subsection (n).
       ``(B) For the purposes of this paragraph, the term 
     `existing qualifying cogeneration facility' means a facility 
     that--
       ``(i) was a qualifying cogeneration facility on the date of 
     enactment of subsection (m); or
       ``(ii) had filed with the Commission a notice of self-
     certification, self recertification or an application for 
     Commission certification under 18 C.F.R. 292.207 prior to the 
     date on which the Commission issues the final rule required 
     by subsection (n).
       ``(3) Commission review.--Any electric utility may file an 
     application with the Commission for relief from the mandatory 
     purchase obligation pursuant to this subsection on a service 
     territory-wide basis. Such application shall set forth the 
     factual basis upon which relief is requested and describe why 
     the conditions set forth in subparagraphs (A), (B) or (C) of 
     paragraph (1) of this subsection have been met. After notice, 
     including sufficient notice to potentially affected 
     qualifying cogeneration facilities and qualifying small power 
     production facilities, and an opportunity for comment, the 
     Commission shall make a final determination within 90 days of 
     such application regarding whether the conditions set forth 
     in subparagraphs (A), (B) or (C) of paragraph (1) have been 
     met.
       ``(4) Reinstatement of obligation to purchase.--At any time 
     after the Commission makes a finding under paragraph (3) 
     relieving an electric utility of its obligation to purchase 
     electric energy, a qualifying cogeneration facility, a 
     qualifying small power production facility, a State agency, 
     or any other affected person may apply to the Commission for 
     an order reinstating the electric utility's obligation to 
     purchase electric energy under this section. Such application 
     shall set forth the factual basis upon which the application 
     is based and describe why the conditions set forth in 
     subparagraphs (A), (B) or (C) of paragraph (1) of this 
     subsection are no longer met. After notice, including 
     sufficient notice to potentially affected utilities, and 
     opportunity for comment, the Commission shall issue an order 
     within 90 days of such application reinstating the electric 
     utility's obligation to purchase electric energy under this 
     section if the Commission finds that the conditions set forth 
     in subparagraphs (A), (B) or (C) of paragraph (1) which 
     relieved the obligation to purchase, are no longer met.
       ``(5) Obligation to sell.--After the date of enactment of 
     this subsection, no electric utility shall be required to 
     enter into a new contract or obligation to sell electric 
     energy to a qualifying cogeneration facility or a qualifying 
     small power production facility under this section if the 
     Commission finds that--
       ``(A) competing retail electric suppliers are willing and 
     able to sell and deliver electric energy to the qualifying 
     cogeneration facility or qualifying small power production 
     facility; and
       ``(B) the electric utility is not required by State law to 
     sell electric energy in its service territory.
       ``(6) No effect on existing rights and remedies.--Nothing 
     in this subsection affects the rights or remedies of any 
     party under any contract or obligation, in effect or pending 
     approval before the appropriate State regulatory authority or 
     non-regulated electric utility on the date of enactment of 
     this subsection, to purchase electric energy or capacity from 
     or to sell electric energy or capacity to a qualifying 
     cogeneration facility or qualifying small power production 
     facility under this Act (including the right to recover costs 
     of purchasing electric energy or capacity).
       ``(7) Recovery of costs.--(A) The Commission shall issue 
     and enforce such regulations as are necessary to ensure that 
     an electric utility that purchases electric energy or 
     capacity from a qualifying cogeneration facility or 
     qualifying small power production facility in accordance with 
     any legally enforceable obligation entered into or imposed 
     under this section recovers all prudently incurred costs 
     associated with the purchase.
       ``(B) A regulation under subparagraph (A) shall be 
     enforceable in accordance with the provisions of law 
     applicable to enforcement of regulations under the Federal 
     Power Act (16 U.S.C. 791a et seq.).
       ``(n) Rulemaking for New Qualifying Facilities.--(1)(A) Not 
     later than 180 days after the date of enactment of this 
     section, the Commission shall issue a rule revising the 
     criteria in 18 C.F.R. 292.205 for new qualifying cogeneration 
     facilities seeking to sell electric energy pursuant to 
     section 210 of this Act to ensure--
       ``(i) that the thermal energy output of a new qualifying 
     cogeneration facility is used in a productive and beneficial 
     manner;
       ``(ii) the electrical, thermal, and chemical output of the 
     cogeneration facility is used fundamentally for industrial, 
     commercial, or institutional purposes and is not intended 
     fundamentally for sale to an electric utility, taking into 
     account technological, efficiency, economic, and variable 
     thermal energy requirements, as well as State laws applicable 
     to sales of electric energy from a qualifying facility to its 
     host facility; and
       ``(iii) continuing progress in the development of efficient 
     electric energy generating technology.
       ``(B) The rule issued pursuant to paragraph (1)(A) of this 
     subsection shall be applicable only to facilities that seek 
     to sell electric energy pursuant to section 210 of this Act. 
     For all other purposes, except as specifically provided in 
     subsection (m)(2)(A), qualifying facility status shall be 
     determined in accordance with the rules and regulations of 
     this Act.
       ``(2) Notwithstanding rule revisions under paragraph (1), 
     the Commission's criteria for qualifying cogeneration 
     facilities in effect prior to the date on which the 
     Commission issues the final rule required by paragraph (1) 
     shall continue to apply to any cogeneration facility that--
       ``(A) was a qualifying cogeneration facility on the date of 
     enactment of subsection (m), or
       ``(B) had filed with the Commission a notice of self-
     certification, self-recertification or an application for 
     Commission certification under 18 C.F.R. 292.207 prior to the 
     date on which the Commission issues the final rule required 
     by paragraph (1).''.
       (b) Elimination of Ownership Limitations.--
       (1) Qualifying small power production facility.--Section 
     3(17)(C) of the Federal Power Act (16 U.S.C. 796(17)(C)) is 
     amended to read as follows:
       ``(C) `qualifying small power production facility' means a 
     small power production facility that the Commission 
     determines, by rule, meets such requirements (including 
     requirements respecting fuel use, fuel efficiency, and 
     reliability) as the Commission may, by rule, prescribe;''.
       (2) Qualifying cogeneration facility.--Section 3(18)(B) of 
     the Federal Power Act (16 U.S.C. 796(18)(B)) is amended to 
     read as follows:
       ``(B) `qualifying cogeneration facility' means a 
     cogeneration facility that the Commission determines, by 
     rule, meets such requirements (including requirements 
     respecting minimum size, fuel use, and fuel efficiency) as 
     the Commission may, by rule, prescribe;''.

     SEC. 1254. INTERCONNECTION.

       (a) Adoption of Standards.--Section 111(d) of the Public 
     Utility Regulatory Policies Act of 1978 (16 U.S.C. 2621 (d) ) 
     is amended by adding at the end the following:
       ``(15) Interconnection.--Each electric utility shall make 
     available, upon request, interconnection service to any 
     electric consumer that the electric utility serves. For 
     purposes of this paragraph, the term `interconnection 
     service' means service to an electric consumer under which an 
     on-site generating facility on the consumer's premises shall 
     be connected to the local distribution facilities. 
     Interconnection services shall be offered based upon the 
     standards developed by the Institute of Electrical and 
     Electronics Engineers: IEEE Standard 1547 for Interconnecting 
     Distributed Resources with Electric Power Systems, as they 
     may be amended from time to time. In addition, agreements and 
     procedures shall be established whereby the services are 
     offered shall promote current best practices of 
     interconnection for distributed generation, including but not 
     limited to practices stipulated in model codes adopted by 
     associations of state regulatory agencies. All such 
     agreements and procedures shall be just and reasonable, and 
     not unduly discriminatory or preferential.''.
       (b) Compliance.--
       (1) Time limitations.--Section 112(b) of the Public Utility 
     Regulatory Policies Act of 1978 (16 U.S.C. 2622(b)) is 
     amended by adding at the end the following:
       ``(5)(A) Not later than one year after the enactment of 
     this paragraph, each State regulatory authority (with respect 
     to each electric utility for which it has ratemaking 
     authority) and each nonregulated utility shall commence the 
     consideration referred to in section 111, or set a hearing 
     date for consideration, with respect to the standard 
     established by paragraph (15) of section 111(d).
       ``(B) Not later than two years after the date of the 
     enactment of the this paragraph, each State regulatory 
     authority (with respect to each electric utility for which it 
     has ratemaking authority), and each nonregulated electric 
     utility, shall complete the consideration, and shall make the 
     determination, referred to in section 111 with respect to 
     each standard established by paragraph (15) of section 
     111(d).''.
       (2) Failure to comply.--Section 112(d) of the Public 
     Utility Regulatory Policies Act of 1978 (16 U.S.C. 2622 (c)) 
     is amended by adding at the end the following: ``In the case 
     of the standard established by paragraph (15), the reference 
     contained in this subsection to the date of enactment of this 
     Act shall be deemed to be a reference to the date of 
     enactment of paragraph (15).''.
       (3) Prior state actions.--
       (A) In general.--Section 112 of the Public Utility 
     Regulatory Policies Act of 1978 (16 U.S.C. 2622) is amended 
     by adding at the end the following:
       ``(f) Prior State Actions.--Subsections (b) and (c) of this 
     section shall not apply to the standard established by 
     paragraph (15) of section 111(d) in the case of any electric 
     utility in

[[Page 17897]]

     a State if, before the enactment of this subsection--
       ``(1) the State has implemented for such utility the 
     standard concerned (or a comparable standard);
       ``(2) the State regulatory authority for such State or 
     relevant nonregulated electric utility has conducted a 
     proceeding to consider implementation of the standard 
     concerned (or a comparable standard) for such utility; or
       ``(3) the State legislature has voted on the implementation 
     of such standard (or a comparable standard) for such 
     utility.''.
       (B) Cross reference.--Section 124 of such Act (16 U.S.C. 
     2634) is amended by adding the following at the end thereof: 
     ``In the case of each standard established by paragraph (15) 
     of section 111(d), the reference contained in this subsection 
     to the date of enactment of the Act shall be deemed to be a 
     reference to the date of enactment of paragraph (15).''.
                      Subtitle F--Repeal of PUHCA

     SEC. 1261. SHORT TITLE.

       This subtitle may be cited as the ``Public Utility Holding 
     Company Act of 2005''.

     SEC. 1262. DEFINITIONS.

       For purposes of this subtitle:
       (1) Affiliate.--The term ``affiliate'' of a company means 
     any company, 5 percent or more of the outstanding voting 
     securities of which are owned, controlled, or held with power 
     to vote, directly or indirectly, by such company.
       (2) Associate company.--The term ``associate company'' of a 
     company means any company in the same holding company system 
     with such company.
       (3) Commission.--The term ``Commission'' means the Federal 
     Energy Regulatory Commission.
       (4) Company.--The term ``company'' means a corporation, 
     partnership, association, joint stock company, business 
     trust, or any organized group of persons, whether 
     incorporated or not, or a receiver, trustee, or other 
     liquidating agent of any of the foregoing.
       (5) Electric utility company.--The term ``electric utility 
     company'' means any company that owns or operates facilities 
     used for the generation, transmission, or distribution of 
     electric energy for sale.
       (6) Exempt wholesale generator and foreign utility 
     company.--The terms ``exempt wholesale generator'' and 
     ``foreign utility company'' have the same meanings as in 
     sections 32 and 33, respectively, of the Public Utility 
     Holding Company Act of 1935 (15 U.S.C. 79z-5a, 79z-5b), as 
     those sections existed on the day before the effective date 
     of this subtitle.
       (7) Gas utility company.--The term ``gas utility company'' 
     means any company that owns or operates facilities used for 
     distribution at retail (other than the distribution only in 
     enclosed portable containers or distribution to tenants or 
     employees of the company operating such facilities for their 
     own use and not for resale) of natural or manufactured gas 
     for heat, light, or power.
       (8) Holding company.--
       (A) In general.--The term ``holding company'' means--
       (i) any company that directly or indirectly owns, controls, 
     or holds, with power to vote, 10 percent or more of the 
     outstanding voting securities of a public-utility company or 
     of a holding company of any public-utility company; and
       (ii) any person, determined by the Commission, after notice 
     and opportunity for hearing, to exercise directly or 
     indirectly (either alone or pursuant to an arrangement or 
     understanding with 1 or more persons) such a controlling 
     influence over the management or policies of any public-
     utility company or holding company as to make it necessary or 
     appropriate for the rate protection of utility customers with 
     respect to rates that such person be subject to the 
     obligations, duties, and liabilities imposed by this subtitle 
     upon holding companies.
       (B) Exclusions.--The term ``holding company'' shall not 
     include--
       (i) a bank, savings association, or trust company, or their 
     operating subsidiaries that own, control, or hold, with the 
     power to vote, public utility or public utility holding 
     company securities so long as the securities are--

       (I) held as collateral for a loan;
       (II) held in the ordinary course of business as a 
     fiduciary; or
       (III) acquired solely for purposes of liquidation and in 
     connection with a loan previously contracted for and owned 
     beneficially for a period of not more than two years; or

       (ii) a broker or dealer that owns, controls, or holds with 
     the power to vote public utility or public utility holding 
     company securities so long as the securities are--

       (I) not beneficially owned by the broker or dealer and are 
     subject to any voting instructions which may be given by 
     customers or their assigns; or
       (II) acquired within 12 months in the ordinary course of 
     business as a broker, dealer, or underwriter with the bona 
     fide intention of effecting distribution of the specific 
     securities so acquired.

       (9) Holding company system.--The term ``holding company 
     system'' means a holding company, together with its 
     subsidiary companies.
       (10) Jurisdictional rates.--The term ``jurisdictional 
     rates'' means rates accepted or established by the Commission 
     for the transmission of electric energy in interstate 
     commerce, the sale of electric energy at wholesale in 
     interstate commerce, the transportation of natural gas in 
     interstate commerce, and the sale in interstate commerce of 
     natural gas for resale for ultimate public consumption for 
     domestic, commercial, industrial, or any other use.
       (11) Natural gas company.--The term ``natural gas company'' 
     means a person engaged in the transportation of natural gas 
     in interstate commerce or the sale of such gas in interstate 
     commerce for resale.
       (12) Person.--The term ``person'' means an individual or 
     company.
       (13) Public utility.--The term ``public utility'' means any 
     person who owns or operates facilities used for transmission 
     of electric energy in interstate commerce or sales of 
     electric energy at wholesale in interstate commerce.
       (14) Public-utility company.--The term ``public-utility 
     company'' means an electric utility company or a gas utility 
     company.
       (15) State commission.--The term ``State commission'' means 
     any commission, board, agency, or officer, by whatever name 
     designated, of a State, municipality, or other political 
     subdivision of a State that, under the laws of such State, 
     has jurisdiction to regulate public utility companies.
       (16) Subsidiary company.--The term ``subsidiary company'' 
     of a holding company means--
       (A) any company, 10 percent or more of the outstanding 
     voting securities of which are directly or indirectly owned, 
     controlled, or held with power to vote, by such holding 
     company; and
       (B) any person, the management or policies of which the 
     Commission, after notice and opportunity for hearing, 
     determines to be subject to a controlling influence, directly 
     or indirectly, by such holding company (either alone or 
     pursuant to an arrangement or understanding with 1 or more 
     other persons) so as to make it necessary for the rate 
     protection of utility customers with respect to rates that 
     such person be subject to the obligations, duties, and 
     liabilities imposed by this subtitle upon subsidiary 
     companies of holding companies.
       (17) Voting security.--The term ``voting security'' means 
     any security presently entitling the owner or holder thereof 
     to vote in the direction or management of the affairs of a 
     company.

     SEC. 1263. REPEAL OF THE PUBLIC UTILITY HOLDING COMPANY ACT 
                   OF 1935.

       The Public Utility Holding Company Act of 1935 (15 U.S.C. 
     79 et seq.) is repealed.

     SEC. 1264. FEDERAL ACCESS TO BOOKS AND RECORDS.

       (a) In General.--Each holding company and each associate 
     company thereof shall maintain, and shall make available to 
     the Commission, such books, accounts, memoranda, and other 
     records as the Commission determines are relevant to costs 
     incurred by a public utility or natural gas company that is 
     an associate company of such holding company and necessary or 
     appropriate for the protection of utility customers with 
     respect to jurisdictional rates.
       (b) Affiliate Companies.--Each affiliate of a holding 
     company or of any subsidiary company of a holding company 
     shall maintain, and shall make available to the Commission, 
     such books, accounts, memoranda, and other records with 
     respect to any transaction with another affiliate, as the 
     Commission determines are relevant to costs incurred by a 
     public utility or natural gas company that is an associate 
     company of such holding company and necessary or appropriate 
     for the protection of utility customers with respect to 
     jurisdictional rates.
       (c) Holding Company Systems.--The Commission may examine 
     the books, accounts, memoranda, and other records of any 
     company in a holding company system, or any affiliate 
     thereof, as the Commission determines are relevant to costs 
     incurred by a public utility or natural gas company within 
     such holding company system and necessary or appropriate for 
     the protection of utility customers with respect to 
     jurisdictional rates.
       (d) Confidentiality.--No member, officer, or employee of 
     the Commission shall divulge any fact or information that may 
     come to his or her knowledge during the course of examination 
     of books, accounts, memoranda, or other records as provided 
     in this section, except as may be directed by the Commission 
     or by a court of competent jurisdiction.

     SEC. 1265. STATE ACCESS TO BOOKS AND RECORDS.

       (a) In General.--Upon the written request of a State 
     commission having jurisdiction to regulate a public-utility 
     company in a holding company system, the holding company or 
     any associate company or affiliate thereof, other than such 
     public-utility company, wherever located, shall produce for 
     inspection books, accounts, memoranda, and other records 
     that--
       (1) have been identified in reasonable detail in a 
     proceeding before the State commission;
       (2) the State commission determines are relevant to costs 
     incurred by such public-utility company; and
       (3) are necessary for the effective discharge of the 
     responsibilities of the State commission with respect to such 
     proceeding.
       (b) Limitation.--Subsection (a) does not apply to any 
     person that is a holding company solely by reason of 
     ownership of 1 or more qualifying facilities under the Public 
     Utility Regulatory Policies Act of 1978 (16 U.S.C. 2601 et 
     seq.).
       (c) Confidentiality of Information.--The production of 
     books, accounts, memoranda, and other records under 
     subsection (a) shall be subject to such terms and conditions 
     as may be necessary and appropriate to safeguard against 
     unwarranted disclosure to the public of any trade secrets or 
     sensitive commercial information.

[[Page 17898]]

       (d) Effect on State Law.--Nothing in this section shall 
     preempt applicable State law concerning the provision of 
     books, accounts, memoranda, and other records, or in any way 
     limit the rights of any State to obtain books, accounts, 
     memoranda, and other records under any other Federal law, 
     contract, or otherwise.
       (e) Court Jurisdiction.--Any United States district court 
     located in the State in which the State commission referred 
     to in subsection (a) is located shall have jurisdiction to 
     enforce compliance with this section.

     SEC. 1266. EXEMPTION AUTHORITY.

       (a) Rulemaking.--Not later than 90 days after the effective 
     date of this subtitle, the Commission shall issue a final 
     rule to exempt from the requirements of section 1264 
     (relating to Federal access to books and records) any person 
     that is a holding company, solely with respect to 1 or more--
       (1) qualifying facilities under the Public Utility 
     Regulatory Policies Act of 1978 (16 U.S.C. 2601 et seq.);
       (2) exempt wholesale generators; or
       (3) foreign utility companies.
       (b) Other Authority.--The Commission shall exempt a person 
     or transaction from the requirements of section 1264 
     (relating to Federal access to books and records) if, upon 
     application or upon the motion of the Commission--
       (1) the Commission finds that the books, accounts, 
     memoranda, and other records of any person are not relevant 
     to the jurisdictional rates of a public utility or natural 
     gas company; or
       (2) the Commission finds that any class of transactions is 
     not relevant to the jurisdictional rates of a public utility 
     or natural gas company.

     SEC. 1267. AFFILIATE TRANSACTIONS.

       (a) Commission Authority Unaffected.--Nothing in this 
     subtitle shall limit the authority of the Commission under 
     the Federal Power Act (16 U.S.C. 791a et seq.) to require 
     that jurisdictional rates are just and reasonable, including 
     the ability to deny or approve the pass through of costs, the 
     prevention of cross-subsidization, and the issuance of such 
     rules and regulations as are necessary or appropriate for the 
     protection of utility consumers.
       (b) Recovery of Costs.--Nothing in this subtitle shall 
     preclude the Commission or a State commission from exercising 
     its jurisdiction under otherwise applicable law to determine 
     whether a public-utility company, public utility, or natural 
     gas company may recover in rates any costs of an activity 
     performed by an associate company, or any costs of goods or 
     services acquired by such public-utility company from an 
     associate company.

     SEC. 1268. APPLICABILITY.

       Except as otherwise specifically provided in this subtitle, 
     no provision of this subtitle shall apply to, or be deemed to 
     include--
       (1) the United States;
       (2) a State or any political subdivision of a State;
       (3) any foreign governmental authority not operating in the 
     United States;
       (4) any agency, authority, or instrumentality of any entity 
     referred to in paragraph (1), (2), or (3); or
       (5) any officer, agent, or employee of any entity referred 
     to in paragraph (1), (2), (3), or (4) acting as such in the 
     course of his or her official duty.

     SEC. 1269. EFFECT ON OTHER REGULATIONS.

       Nothing in this subtitle precludes the Commission or a 
     State commission from exercising its jurisdiction under 
     otherwise applicable law to protect utility customers.

     SEC. 1270. ENFORCEMENT.

       The Commission shall have the same powers as set forth in 
     sections 306 through 317 of the Federal Power Act (16 U.S.C. 
     825e-825p) to enforce the provisions of this subtitle.

     SEC. 1271. SAVINGS PROVISIONS.

       (a) In General.--Nothing in this subtitle, or otherwise in 
     the Public Utility Holding Company Act of 1935, or rules, 
     regulations, or orders thereunder, prohibits a person from 
     engaging in or continuing to engage in activities or 
     transactions in which it is legally engaged or authorized to 
     engage on the date of enactment of this Act, if that person 
     continues to comply with the terms (other than an expiration 
     date or termination date) of any such authorization, whether 
     by rule or by order.
       (b) Effect on Other Commission Authority.--Nothing in this 
     subtitle limits the authority of the Commission under the 
     Federal Power Act (16 U.S.C. 791a et seq.) or the Natural Gas 
     Act (15 U.S.C. 717 et seq.).
       (c) Tax Treatment.--Tax treatment under section 1081 of the 
     Internal Revenue Code of 1986 as a result of transactions 
     ordered in compliance with the Public Utility Holding Company 
     Act of 1935 (15 U.S.C. 79 et seq.) shall not be affected in 
     any manner due to the repeal of that Act and the enactment of 
     the Public Utility Holding Company Act of 2005.

     SEC. 1272. IMPLEMENTATION.

       Not later than 4 months after the date of enactment of this 
     subtitle, the Commission shall--
       (1) issue such regulations as may be necessary or 
     appropriate to implement this subtitle (other than section 
     1265, relating to State access to books and records); and
       (2) submit to Congress detailed recommendations on 
     technical and conforming amendments to Federal law necessary 
     to carry out this subtitle and the amendments made by this 
     subtitle.

     SEC. 1273. TRANSFER OF RESOURCES.

       All books and records that relate primarily to the 
     functions transferred to the Commission under this subtitle 
     shall be transferred from the Securities and Exchange 
     Commission to the Commission.

     SEC. 1274. EFFECTIVE DATE.

       (a) In General.--Except for section 1272 (relating to 
     implementation), this subtitle shall take effect 6 months 
     after the date of enactment of this subtitle.
       (b) Compliance With Certain Rules.--If the Commission 
     approves and makes effective any final rulemaking modifying 
     the standards of conduct governing entities that own, 
     operate, or control facilities for transmission of 
     electricity in interstate commerce or transportation of 
     natural gas in interstate commerce prior to the effective 
     date of this subtitle, any action taken by a public-utility 
     company or utility holding company to comply with the 
     requirements of such rulemaking shall not subject such 
     public-utility company or utility holding company to any 
     regulatory requirement applicable to a holding company under 
     the Public Utility Holding Company Act of 1935 (15 U.S.C. 79 
     et seq.).

     SEC. 1275. SERVICE ALLOCATION.

       (a) Definition of Public Utility.--In this section, the 
     term ``public utility'' has the meaning given the term in 
     section 201(e) of the Federal Power Act (16 U.S.C. 824(e)).
       (b) FERC Review.--In the case of non-power goods or 
     administrative or management services provided by an 
     associate company organized specifically for the purpose of 
     providing such goods or services to any public utility in the 
     same holding company system, at the election of the system or 
     a State commission having jurisdiction over the public 
     utility, the Commission, after the effective date of this 
     subtitle, shall review and authorize the allocation of the 
     costs for such goods or services to the extent relevant to 
     that associate company.
       (c) Effect on Federal and State Law.--Nothing in this 
     section shall affect the authority of the Commission or a 
     State commission under other applicable law.
       (d) Rules.--Not later than 4 months after the date of 
     enactment of this Act, the Commission shall issue rules 
     (which rules shall be effective no earlier than the effective 
     date of this subtitle) to exempt from the requirements of 
     this section any company in a holding company system whose 
     public utility operations are confined substantially to a 
     single State and any other class of transactions that the 
     Commission finds is not relevant to the jurisdictional rates 
     of a public utility.

     SEC. 1276. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated such funds as may 
     be necessary to carry out this subtitle.

     SEC. 1277. CONFORMING AMENDMENTS TO THE FEDERAL POWER ACT.

       (a) Conflict of Jurisdiction.--Section 318 of the Federal 
     Power Act (16 U.S.C. 825q) is repealed.
       (b) Definitions.--(1) Section 201(g)(5) of the Federal 
     Power Act (16 U.S.C. 824(g)(5)) is amended by striking 
     ``1935'' and inserting ``2005''.
       (2) Section 214 of the Federal Power Act (16 U.S.C. 824m) 
     is amended by striking ``1935'' and inserting ``2005''.
 Subtitle G--Market Transparency, Enforcement, and Consumer Protection

     SEC. 1281. ELECTRICITY MARKET TRANSPARENCY.

       Part II of the Federal Power Act is amended by adding at 
     the end the following:

     ``SEC. 220. ELECTRICITY MARKET TRANSPARENCY RULES.

       ``(a)(1) The Commission is directed to facilitate price 
     transparency in markets for the sale and transmission of 
     electric energy in interstate commerce, having due regard for 
     the public interest, the integrity of those markets, fair 
     competition, and the protection of consumers.
       ``(2) The Commission may prescribe such rules as the 
     Commission determines necessary and appropriate to carry out 
     the purposes of this section. The rules shall provide for the 
     dissemination, on a timely basis, of information about the 
     availability and prices of wholesale electric energy and 
     transmission service to the Commission, State commissions, 
     buyers and sellers of wholesale electric energy, users of 
     transmission services, and the public.
       ``(3) The Commission may--
       ``(A) obtain the information described in paragraph (2) 
     from any market participant; and
       ``(B) rely on entities other than the Commission to receive 
     and make public the information, subject to the disclosure 
     rules in subsection (b).
       ``(4) In carrying out this section, the Commission shall 
     consider the degree of price transparency provided by 
     existing price publishers and providers of trade processing 
     services, and shall rely on such publishers and services to 
     the maximum extent possible. The Commission may establish an 
     electronic information system if it determines that existing 
     price publications are not adequately providing price 
     discovery or market transparency. Nothing in this section, 
     however, shall affect any electronic information filing 
     requirements in effect under this Act as of the date of 
     enactment of this section.
       ``(b)(1) Rules described in subsection (a)(2), if adopted, 
     shall exempt from disclosure information the Commission 
     determines would, if disclosed, be detrimental to the 
     operation of an effective market or jeopardize system 
     security.
       ``(2) In determining the information to be made available 
     under this section and time to make the information 
     available, the Commission shall seek to ensure that consumers 
     and competitive markets are protected from the adverse 
     effects of potential collusion or other anticompetitive 
     behaviors that can be facilitated by

[[Page 17899]]

     untimely public disclosure of transaction-specific 
     information.
       ``(c)(1) Within 180 days of enactment of this section, the 
     Commission shall conclude a memorandum of understanding with 
     the Commodity Futures Trading Commission relating to 
     information sharing, which shall include, among other things, 
     provisions ensuring that information requests to markets 
     within the respective jurisdiction of each agency are 
     properly coordinated to minimize duplicative information 
     requests, and provisions regarding the treatment of 
     proprietary trading information.
       ``(2) Nothing in this section may be construed to limit or 
     affect the exclusive jurisdiction of the Commodity Futures 
     Trading Commission under the Commodity Exchange Act (7 U.S.C. 
     1 et seq.).
       ``(d) The Commission shall not require entities who have a 
     de minimis market presence to comply with the reporting 
     requirements of this section.
       ``(e)(1) Except as provided in paragraph (2), no person 
     shall be subject to any civil penalty under this section with 
     respect to any violation occurring more than 3 years before 
     the date on which the person is provided notice of the 
     proposed penalty under section 316A.
       ``(2) Paragraph (1) shall not apply in any case in which 
     the Commission finds that a seller that has entered into a 
     contract for the sale of electric energy at wholesale or 
     transmission service subject to the jurisdiction of the 
     Commission has engaged in fraudulent market manipulation 
     activities materially affecting the contract in violation of 
     section 222.
       ``(f) This section shall not apply to a transaction for the 
     purchase or sale of wholesale electric energy or transmission 
     services within the area described in section 
     212(k)(2)(A).''.

     SEC. 1282. FALSE STATEMENTS.

       Part II of the Federal Power Act (16 U.S.C. 824 et seq.) is 
     amended by adding at the end the following:

     ``SEC. 221. PROHIBITION ON FILING FALSE INFORMATION.

       ``No entity (including an entity described in section 
     201(f)) shall willfully and knowingly report any information 
     relating to the price of electricity sold at wholesale or the 
     availability of transmission capacity, which information the 
     person or any other entity knew to be false at the time of 
     the reporting, to a Federal agency with intent to 
     fraudulently affect the data being compiled by the Federal 
     agency.''.

     SEC. 1283. MARKET MANIPULATION.

       Part II of the Federal Power Act (16 U.S.C. 824 et seq.) is 
     amended by adding at the end the following:

     ``SEC. 222. PROHIBITION OF ENERGY MARKET MANIPULATION.

       ``(a) In General.--It shall be unlawful for any entity 
     (including an entity described in section 201(f)), directly 
     or indirectly, to use or employ, in connection with the 
     purchase or sale of electric energy or the purchase or sale 
     of transmission services subject to the jurisdiction of the 
     Commission, any manipulative or deceptive device or 
     contrivance (as those terms are used in section 10(b) of the 
     Securities Exchange Act of 1934 (15 U.S.C. 78j(b))), in 
     contravention of such rules and regulations as the Commission 
     may prescribe as necessary or appropriate in the public 
     interest or for the protection of electric ratepayers.
       ``(b) No Private Right of Action.--Nothing in this section 
     shall be construed to create a private right of action.''.

     SEC. 1284. ENFORCEMENT.

       (a) Complaints.--Section 306 of the Federal Power Act (16 
     U.S.C. 825e) is amended--
       (1) by inserting ``electric utility,'' after ``Any 
     person,''; and
       (2) by inserting ``, transmitting utility,'' after 
     ``licensee'' each place it appears.
       (b) Investigations.--Section 307(a) of the Federal Power 
     Act (16 U.S.C. 825f(a)) is amended--
       (1) by inserting ``, electric utility, transmitting 
     utility, or other entity'' after ``person'' each place it 
     appears; and
       (2) in the first sentence, by inserting before the period 
     at the end the following: ``, or in obtaining information 
     about the sale of electric energy at wholesale in interstate 
     commerce and the transmission of electric energy in 
     interstate commerce''.
       (c) Review of Commission Orders.--Section 313(a) of the 
     Federal Power Act (16 U.S.C. 825l) is amended by inserting 
     ``electric utility,'' after ``person,'' in the first 2 places 
     it appears and by striking ``any person unless such person'' 
     and inserting ``any entity unless such entity''.
       (d) Criminal Penalties.--Section 316 of the Federal Power 
     Act (16 U.S.C. 825o) is amended--
       (1) in subsection (a)--
       (A) by striking ``$5,000'' and inserting ``$1,000,000''; 
     and
       (B) by striking ``two years'' and inserting ``5 years'';
       (2) in subsection (b), by striking ``$500'' and inserting 
     ``$25,000''; and
       (3) by striking subsection (c).
       (e) Civil Penalties.--Section 316A of the Federal Power Act 
     (16 U.S.C. 825o-1) is amended--
       (1) by striking ``section 211, 212, 213, or 214'' each 
     place it appears and inserting ``part II''; and
       (2) in subsection (b), by striking ``$10,000'' and 
     inserting ``$1,000,000''.

     SEC. 1285. REFUND EFFECTIVE DATE.

       Section 206(b) of the Federal Power Act (16 U.S.C. 824e(b)) 
     is amended as follows:
       (1) By striking ``the date 60 days after the filing of such 
     complaint nor later than 5 months after the expiration of 
     such 60-day period'' in the second sentence and inserting 
     ``the date of the filing of such complaint nor later than 5 
     months after the filing of such complaint''.
       (2) By striking ``60 days after'' in the third sentence and 
     inserting ``of''.
       (3) By striking ``expiration of such 60-day period'' in the 
     third sentence and inserting ``publication date''.
       (4) By striking the fifth sentence and inserting the 
     following: ``If no final decision is rendered by the 
     conclusion of the 180-day period commencing upon initiation 
     of a proceeding pursuant to this section, the Commission 
     shall state the reasons why it has failed to do so and shall 
     state its best estimate as to when it reasonably expects to 
     make such decision.''.

     SEC. 1286. REFUND AUTHORITY.

       Section 206 of the Federal Power Act (16 U.S.C. 824e) is 
     amended by adding at the end the following:
       ``(e)(1) In this subsection:
       ``(A) The term `short-term sale' means an agreement for the 
     sale of electric energy at wholesale in interstate commerce 
     that is for a period of 31 days or less (excluding monthly 
     contracts subject to automatic renewal).
       ``(B) The term `applicable Commission rule' means a 
     Commission rule applicable to sales at wholesale by public 
     utilities that the Commission determines after notice and 
     comment should also be applicable to entities subject to this 
     subsection.
       ``(2) If an entity described in section 201(f) voluntarily 
     makes a short-term sale of electric energy through an 
     organized market in which the rates for the sale are 
     established by Commission-approved tariff (rather than by 
     contract) and the sale violates the terms of the tariff or 
     applicable Commission rules in effect at the time of the 
     sale, the entity shall be subject to the refund authority of 
     the Commission under this section with respect to the 
     violation.
       ``(3) This section shall not apply to--
       ``(A) any entity that sells in total (including affiliates 
     of the entity) less than 8,000,000 megawatt hours of 
     electricity per year; or
       ``(B) an electric cooperative.
       ``(4)(A) The Commission shall have refund authority under 
     paragraph (2) with respect to a voluntary short term sale of 
     electric energy by the Bonneville Power Administration only 
     if the sale is at an unjust and unreasonable rate.
       ``(B) The Commission may order a refund under subparagraph 
     (A) only for short-term sales made by the Bonneville Power 
     Administration at rates that are higher than the highest just 
     and reasonable rate charged by any other entity for a short-
     term sale of electric energy in the same geographic market 
     for the same, or most nearly comparable, period as the sale 
     by the Bonneville Power Administration.
       ``(C) In the case of any Federal power marketing agency or 
     the Tennessee Valley Authority, the Commission shall not 
     assert or exercise any regulatory authority or power under 
     paragraph (2) other than the ordering of refunds to achieve a 
     just and reasonable rate.''.

     SEC. 1287. CONSUMER PRIVACY AND UNFAIR TRADE PRACTICES.

       (a) Privacy.--The Federal Trade Commission may issue rules 
     protecting the privacy of electric consumers from the 
     disclosure of consumer information obtained in connection 
     with the sale or delivery of electric energy to electric 
     consumers.
       (b) Slamming.--The Federal Trade Commission may issue rules 
     prohibiting the change of selection of an electric utility 
     except with the informed consent of the electric consumer or 
     if approved by the appropriate State regulatory authority.
       (c) Cramming.--The Federal Trade Commission may issue rules 
     prohibiting the sale of goods and services to an electric 
     consumer unless expressly authorized by law or the electric 
     consumer.
       (d) Rulemaking.--The Federal Trade Commission shall proceed 
     in accordance with section 553 of title 5, United States 
     Code, when prescribing a rule under this section.
       (e) State Authority.--If the Federal Trade Commission 
     determines that a State's regulations provide equivalent or 
     greater protection than the provisions of this section, such 
     State regulations shall apply in that State in lieu of the 
     regulations issued by the Commission under this section.
       (f) Definitions.--For purposes of this section:
       (1) State regulatory authority.--The term ``State 
     regulatory authority'' has the meaning given that term in 
     section 3(21) of the Federal Power Act (16 U.S.C. 796(21)).
       (2) Electric consumer and electric utility.--The terms 
     ``electric consumer'' and ``electric utility'' have the 
     meanings given those terms in section 3 of the Public Utility 
     Regulatory Policies Act of 1978 (16 U.S.C. 2602).

     SEC. 1288. AUTHORITY OF COURT TO PROHIBIT INDIVIDUALS FROM 
                   SERVING AS OFFICERS, DIRECTORS, AND ENERGY 
                   TRADERS.

       Section 314 of the Federal Power Act (16 U.S.C. 825m) is 
     amended by adding at the end the following:
       ``(d) In any proceedings under subsection (a), the court 
     may prohibit, conditionally or unconditionally, and 
     permanently or for such period of time as the court 
     determines, any individual who is engaged or has engaged in 
     practices constituting a violation of section 221 (and 
     related rules and regulations) from--
       ``(1) acting as an officer or director of an electric 
     utility; or
       ``(2) engaging in the business of purchasing or selling--

[[Page 17900]]

       ``(A) electric energy; or
       ``(B) transmission services subject to the jurisdiction of 
     the Commission.''.

     SEC. 1289. MERGER REVIEW REFORM.

       (a) In General.--Section 203(a) of the Federal Power Act 
     (16 U.S.C. 824b(a)) is amended to read as follows:
       ``(a)(1) No public utility shall, without first having 
     secured an order of the Commission authorizing it to do so--
       ``(A) sell, lease, or otherwise dispose of the whole of its 
     facilities subject to the jurisdiction of the Commission, or 
     any part thereof of a value in excess of $10,000,000;
       ``(B) merge or consolidate, directly or indirectly, such 
     facilities or any part thereof with those of any other 
     person, by any means whatsoever;
       ``(C) purchase, acquire, or take any security with a value 
     in excess of $10,000,000 of any other public utility; or
       ``(D) purchase, lease, or otherwise acquire an existing 
     generation facility--
       ``(i) that has a value in excess of $10,000,000; and
       ``(ii) that is used for interstate wholesale sales and over 
     which the Commission has jurisdiction for ratemaking 
     purposes.
       ``(2) No holding company in a holding company system that 
     includes a transmitting utility or an electric utility shall 
     purchase, acquire, or take any security with a value in 
     excess of $10,000,000 of, or, by any means whatsoever, 
     directly or indirectly, merge or consolidate with, a 
     transmitting utility, an electric utility company, or a 
     holding company in a holding company system that includes a 
     transmitting utility, or an electric utility company, with a 
     value in excess of $10,000,000 without first having secured 
     an order of the Commission authorizing it to do so.
       ``(3) Upon receipt of an application for such approval the 
     Commission shall give reasonable notice in writing to the 
     Governor and State commission of each of the States in which 
     the physical property affected, or any part thereof, is 
     situated, and to such other persons as it may deem advisable.
       ``(4) After notice and opportunity for hearing, the 
     Commission shall approve the proposed disposition, 
     consolidation, acquisition, or change in control, if it finds 
     that the proposed transaction will be consistent with the 
     public interest, and will not result in cross-subsidization 
     of a non-utility associate company or the pledge or 
     encumbrance of utility assets for the benefit of an associate 
     company, unless the Commission determines that the cross-
     subsidization, pledge, or encumbrance will be consistent with 
     the public interest.
       ``(5) The Commission shall, by rule, adopt procedures for 
     the expeditious consideration of applications for the 
     approval of dispositions, consolidations, or acquisitions, 
     under this section. Such rules shall identify classes of 
     transactions, or specify criteria for transactions, that 
     normally meet the standards established in paragraph (4). The 
     Commission shall provide expedited review for such 
     transactions. The Commission shall grant or deny any other 
     application for approval of a transaction not later than 180 
     days after the application is filed. If the Commission does 
     not act within 180 days, such application shall be deemed 
     granted unless the Commission finds, based on good cause, 
     that further consideration is required to determine whether 
     the proposed transaction meets the standards of paragraph (4) 
     and issues an order tolling the time for acting on the 
     application for not more than 180 days, at the end of which 
     additional period the Commission shall grant or deny the 
     application.
       ``(6) For purposes of this subsection, the terms `associate 
     company', `holding company', and `holding company system' 
     have the meaning given those terms in the Public Utility 
     Holding Company Act of 2005.''.
       (b) Effective Date.--The amendments made by this section 
     shall take effect 6 months after the date of enactment of 
     this Act.
       (c) Transition Provision.--The amendments made by 
     subsection (a) shall not apply to any application under 
     section 203 of the Federal Power Act (16 U.S.C. 824b) that 
     was filed on or before the date of enactment of this Act.

     SEC. 1290. RELIEF FOR EXTRAORDINARY VIOLATIONS.

       (a) Application.--This section applies to any contract 
     entered into the Western Interconnection prior to June 20, 
     2001, with a seller of wholesale electricity that the 
     Commission has--
       (1) found to have manipulated the electricity market 
     resulting in unjust and unreasonable rates; and
       (2) revoked the seller's authority to sell any electricity 
     at market-based rates.
       (b) Relief.--Notwithstanding section 222 of the Federal 
     Power Act (as added by section 1262), any provision of title 
     11, United States Code, or any other provision of law, in the 
     case of a contract described in subsection (a), the 
     Commission shall have exclusive jurisdiction under the 
     Federal Power Act (16 U.S.C. 791a et seq.) to determine 
     whether a requirement to make termination payments for power 
     not delivered by the seller, or any successor in interest of 
     the seller, is not permitted under a rate schedule (or 
     contract under such a schedule) or is otherwise unlawful on 
     the grounds that the contract is unjust and unreasonable or 
     contrary to the public interest.
       (c) Applicability.--This section applies to any proceeding 
     pending on the date of enactment of this section involving a 
     seller described in subsection (a) in which there is not a 
     final, nonappealable order by the Commission or any other 
     jurisdiction determining the respective rights of the seller.
                        Subtitle H--Definitions

     SEC. 1291. DEFINITIONS.

       (a) Commission.--In this title, the term ``Commission'' 
     means the Federal Energy Regulatory Commission.
       (b) Amendment.--Section 3 of the Federal Power Act (16 
     U.S.C. 796) is amended--
       (1) by striking paragraphs (22) and (23) and inserting the 
     following:
       ``(22) Electric utility.--(A) The term `electric utility' 
     means a person or Federal or State agency (including an 
     entity described in section 201(f)) that sells electric 
     energy.
       ``(B) The term `electric utility' includes the Tennessee 
     Valley Authority and each Federal power marketing 
     administration.
       ``(23) Transmitting utility.--The term `transmitting 
     utility' means an entity (including an entity described in 
     section 201(f)) that owns, operates, or controls facilities 
     used for the transmission of electric energy--
       ``(A) in interstate commerce;
       ``(B) for the sale of electric energy at wholesale.''; and
       (2) by adding at the end the following:
       ``(26) Electric cooperative.--The term `electric 
     cooperative' means a cooperatively owned electric utility.
       ``(27) RTO.--The term `Regional Transmission Organization' 
     or `RTO' means an entity of sufficient regional scope 
     approved by the Commission--
       ``(A) to exercise operational or functional control of 
     facilities used for the transmission of electric energy in 
     interstate commerce; and
       ``(B) to ensure nondiscriminatory access to the facilities.
       ``(28) ISO.--The term `Independent System Operator' or 
     `ISO' means an entity approved by the Commission--
       ``(A) to exercise operational or functional control of 
     facilities used for the transmission of electric energy in 
     interstate commerce; and
       ``(B) to ensure nondiscriminatory access to the facilities.
       ``(29) Transmission organization.--The term `Transmission 
     Organization' means a Regional Transmission Organization, 
     Independent System Operator, independent transmission 
     provider, or other transmission organization finally approved 
     by the Commission for the operation of transmission 
     facilities.''.
       (c) Applicability.--Section 201(f) of the Federal Power Act 
     (16 U.S.C. 824(f)) is amended by striking ``political 
     subdivision of a state,'' and inserting ``political 
     subdivision of a State, an electric cooperative that receives 
     financing under the Rural Electrification Act of 1936 (7 
     U.S.C. 901 et seq.) or that sells less than 4,000,000 
     megawatt hours of electricity per year,''.
            Subtitle I--Technical and Conforming Amendments

     SEC. 1295. CONFORMING AMENDMENTS.

       (a) Section 201 of the Federal Power Act (16 U.S.C. 824) is 
     amended--
       (1) in subsection (b)(2)--
       (A) in the first sentence--
       (i) by striking ``The'' and inserting ``Notwithstanding 
     section 201(f), the''; and
       (ii) by striking ``210, 211, and 212'' and inserting 
     ``203(a)(2), 206(e), 210, 211, 211A, 212, 215, 216, 217, 218, 
     219, 220, 221, and 222''; and
       (B) in the second sentence--
       (i) by inserting ``or rule'' after ``any order''; and
       (ii) by striking ``210 or 211'' and inserting ``203(a)(2), 
     206(e), 210, 211, 211A, 212, 215, 216, 217, 218, 219, 220, 
     221, or 222''; and
       (2) in subsection (e), by striking ``210, 211, or 212'' and 
     inserting ``206(e), 206(f), 210, 211, 211A, 212, 215, 216, 
     217, 218, 219, 220, 221, or 222''.
       (b) Section 206 of the Federal Power Act (16 U.S.C. 824e) 
     is amended--
       (1) in the first sentence of subsection (a), by striking 
     ``hearing had'' and inserting ``hearing held''; and
       (2) in the seventh sentence of subsection (b), by striking 
     ``the public utility to make''.
       (c) Section 211 of the Federal Power Act (16 U.S.C. 824j) 
     is amended--
       (1) in subsection (c)--
       (A) by striking ``(2)'';
       (B) by striking ``(A)'' and inserting ``(1)''
       (C) by striking ``(B)'' and inserting ``(2)''; and
       (D) by striking ``termination of modification'' and 
     inserting ``termination or modification''; and
       (2) in the second sentence of subsection (d)(1), by 
     striking ``electric utility'' the second place it appears and 
     inserting ``transmitting utility''.
       (d) Section 315(c) of the Federal Power Act (16 U.S.C. 
     825n(c)) is amended by striking ``subsection'' and inserting 
     ``section''.
                     Subtitle J--Economic Dispatch

     SEC. 1298. ECONOMIC DISPATCH.

       Part II of the Federal Power Act (16 U.S.C. 824 et seq.) is 
     amended by adding at the end the following:

     ``SEC. 223. JOINT BOARDS ON ECONOMIC DISPATCH.

       ``(a) In General.--The Commission shall convene joint 
     boards on a regional basis pursuant to section 209 of this 
     Act to study the issue of security constrained economic 
     dispatch for the various market regions. The Commission shall 
     designate the appropriate regions to be covered by each such 
     joint board for purposes of this section.
       ``(b) Membership.--The Commission shall request each State 
     to nominate a representative for the appropriate regional 
     joint board, and shall designate a member of the Commission 
     to

[[Page 17901]]

     chair and participate as a member of each such board.
       ``(c) Powers.--The sole authority of each joint board 
     convened under this section shall be to consider issues 
     relevant to what constitutes `security constrained economic 
     dispatch' and how such a mode of operating an electric energy 
     system affects or enhances the reliability and affordability 
     of service to customers in the region concerned and to make 
     recommendations to the Commission regarding such issues.
       ``(d) Report to the Congress.--Within one year after 
     enactment of this section, the Commission shall issue a 
     report and submit such report to the Congress regarding the 
     recommendations of the joint boards under this section and 
     the Commission may consolidate the recommendations of more 
     than one such regional joint board, including any consensus 
     recommendations for statutory or regulatory reform.''.
                TITLE XIII--ENERGY POLICY TAX INCENTIVES

     SEC. 1300. SHORT TITLE; AMENDMENT OF 1986 CODE.

       (a) Short Title.--This title may be cited as the ``Energy 
     Tax Incentives Act of 2005''.
       (b) Amendment of 1986 Code.--Except as otherwise expressly 
     provided, whenever in this title 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.
                 Subtitle A--Electricity Infrastructure

     SEC. 1301. EXTENSION AND MODIFICATION OF RENEWABLE 
                   ELECTRICITY PRODUCTION CREDIT.

       (a) 2-Year Extension for Certain Facilities.--Section 45(d) 
     (relating to qualified facilities) is amended--
       (1) by striking ``January 1, 2006'' each place it appears 
     in paragraphs (1), (2), (3), (5), (6), and (7) and inserting 
     ``January 1, 2008'', and
       (2) by striking ``January 1, 2006'' in paragraph (4) and 
     inserting ``January 1, 2008 (January 1, 2006, in the case of 
     a facility using solar energy)''.
       (b) Increase in Credit Period.--Section 45(b)(4)(B) 
     (relating to credit period) is amended--
       (1) by inserting ``or clause (iii)'' after ``clause (ii)'' 
     in clause (i), and
       (2) by adding at the end the following:
       ``(iii) Termination.--Clause (i) shall not apply to any 
     facility placed in service after the date of the enactment of 
     this clause.''.
       (c) Expansion of Qualified Resources to Certain 
     Hydropower.--
       (1) In general.--Section 45(c)(1) (defining qualified 
     energy resources) is amended by striking ``and'' at the end 
     of subparagraph (F), by striking the period at the end of 
     subparagraph (G) and inserting ``, and'', and by adding at 
     the end the following new subparagraph:
       ``(H) qualified hydropower production.''.
       (2) Credit rate.--Section 45(b)(4)(A) (relating to credit 
     rate) is amended by striking ``or (7)'' and inserting ``(7), 
     or (9)''.
       (3) Definition of resources.--Section 45(c) (relating to 
     qualified energy resources and refined coal) is amended by 
     adding at the end the following new paragraph:
       ``(8) Qualified hydropower production.--
       ``(A) In general.--The term `qualified hydropower 
     production' means--
       ``(i) in the case of any hydroelectric dam which was placed 
     in service on or before the date of the enactment of this 
     paragraph, the incremental hydropower production for the 
     taxable year, and
       ``(ii) in the case of any nonhydroelectric dam described in 
     subparagraph (C), the hydropower production from the facility 
     for the taxable year.
       ``(B) Determination of incremental hydropower production.--
       ``(i) In general.--For purposes of subparagraph (A), 
     incremental hydropower production for any taxable year shall 
     be equal to the percentage of average annual hydropower 
     production at the facility attributable to the efficiency 
     improvements or additions of capacity placed in service after 
     the date of the enactment of this paragraph, determined by 
     using the same water flow information used to determine an 
     historic average annual hydropower production baseline for 
     such facility. Such percentage and baseline shall be 
     certified by the Federal Energy Regulatory Commission.
       ``(ii) Operational changes disregarded.--For purposes of 
     clause (i), the determination of incremental hydropower 
     production shall not be based on any operational changes at 
     such facility not directly associated with the efficiency 
     improvements or additions of capacity.
       ``(C) Nonhydroelectric dam.--For purposes of subparagraph 
     (A), a facility is described in this subparagraph if--
       ``(i) the facility is licensed by the Federal Energy 
     Regulatory Commission and meets all other applicable 
     environmental, licensing, and regulatory requirements,
       ``(ii) the facility was placed in service before the date 
     of the enactment of this paragraph and did not produce 
     hydroelectric power on the date of the enactment of this 
     paragraph, and
       ``(iii) turbines or other generating devices are to be 
     added to the facility after such date to produce 
     hydroelectric power, but only if there is not any enlargement 
     of the diversion structure, or construction or enlargement of 
     a bypass channel, or the impoundment or any withholding of 
     any additional water from the natural stream channel.''.
       (4) Facilities.--Section 45(d) (relating to qualified 
     facilities) is amended by adding at the end the following new 
     paragraph:
       ``(9) Qualified hydropower facility.--In the case of a 
     facility producing qualified hydroelectric production 
     described in subsection (c)(8), the term `qualified facility' 
     means--
       ``(A) in the case of any facility producing incremental 
     hydropower production, such facility but only to the extent 
     of its incremental hydropower production attributable to 
     efficiency improvements or additions to capacity described in 
     subsection (c)(8)(B) placed in service after the date of the 
     enactment of this paragraph and before January 1, 2008, and
       ``(B) any other facility placed in service after the date 
     of the enactment of this paragraph and before January 1, 
     2008.
       ``(C) Credit period.--In the case of a qualified facility 
     described in subparagraph (A), the 10-year period referred to 
     in subsection (a) shall be treated as beginning on the date 
     the efficiency improvements or additions to capacity are 
     placed in service.''.
       (d) Indian Coal.--
       (1) Production facilities.--Subsection (e) of section 45 
     (relating to definitions and special rules) is amended by 
     adding at the end the following new paragraph:
       ``(10) Indian coal production facilities.--
       ``(A) Determination of credit amount.--In the case of a 
     producer of Indian coal, the credit determined under this 
     section (without regard to this paragraph) for any taxable 
     year shall be increased by an amount equal to the applicable 
     dollar amount per ton of Indian coal--
       ``(i) produced by the taxpayer at an Indian coal production 
     facility during the 7-year period beginning on January 1, 
     2006, and
       ``(ii) sold by the taxpayer--

       ``(I) to an unrelated person, and
       ``(II) during such 7-year period and such taxable year.

       ``(B) Applicable dollar amount.--
       ``(i) In general.--The term `applicable dollar amount' for 
     any taxable year beginning in a calendar year means--

       ``(I) $1.50 in the case of calendar years 2006 through 
     2009, and
       ``(II) $2.00 in the case of calendar years beginning after 
     2009.

       ``(ii) Inflation adjustment.--In the case of any calendar 
     year after 2006, each of the dollar amounts under clause (i) 
     shall be equal to the product of such dollar amount and the 
     inflation adjustment factor determined under paragraph (2)(B) 
     for the calendar year, except that such paragraph shall be 
     applied by substituting `2005' for `1992'.
       ``(C) Application of rules.--Rules similar to the rules of 
     the subsection (b)(3) and paragraphs (1), (3), (4), and (5) 
     of this subsection shall apply for purposes of determining 
     the amount of any increase under this paragraph.
       ``(D) Treatment as specified credit.--The increase in the 
     credit determined under subsection (a) by reason of this 
     paragraph with respect to any facility shall be treated as a 
     specified credit for purposes of section 38(c)(4)(A) during 
     the 4-year period beginning on the later of January 1, 2006, 
     or the date on which such facility is placed in service by 
     the taxpayer.''.
       (2) Resource.--Subsection (c) of section 45 (relating to 
     qualified energy resources and refined coal), as amended by 
     this Act, is amended by adding at the end the following new 
     paragraph:
       ``(9) Indian coal.--
       ``(A) In general.--The term `Indian coal' means coal which 
     is produced from coal reserves which, on June 14, 2005--
       ``(i) were owned by an Indian tribe, or
       ``(ii) were held in trust by the United States for the 
     benefit of an Indian tribe or its members.
       ``(B) Indian tribe.--For purposes of this paragraph, the 
     term `Indian tribe' has the meaning given such term by 
     section 7871(c)(3)(E)(ii).''.
       (3) Indian coal production facility.--Subsection (d) of 
     section 45, as amended by this Act, is amended by adding at 
     the end the following new paragraph:
       ``(10) Indian coal production facility.--The term `Indian 
     coal production facility' means a facility which is placed in 
     service before January 1, 2009.''.
       (4) Conforming amendment.--The heading for section 45(c) is 
     amended by striking ``Qualified Energy Resources and Refined 
     Coal'' and inserting ``Resources''.
       (e) Technical Amendment Related to Trash Combustion 
     Facilities.--Section 45(d)(7) (relating to trash combustion 
     facilities) is amended by adding at the end the following: 
     ``Such term shall include a new unit placed in service in 
     connection with a facility placed in service on or before the 
     date of the enactment of this paragraph, but only to the 
     extent of the increased amount of electricity produced at the 
     facility by reason of such new unit.''.
       (f) Additional Technical Amendments Related to Section 710 
     of the American Jobs Creation Act of 2004.--
       (1) Clause (ii) of section 45(b)(4)(B) is amended by 
     striking ``the date of the enactment of this Act'' and 
     inserting ``January 1, 2005,''.
       (2) Clause (ii) of section 45(c)(3)(A) is amended by 
     inserting ``or any nonhazardous lignin waste material'' after 
     ``cellulosic waste material''.
       (3) Subsection (e) of section 45 is amended by striking 
     paragraph (6).
       (4)(A) Paragraph (9) of section 45(e) is amended to read as 
     follows:
       ``(9) Coordination with credit for producing fuel from a 
     nonconventional source.--
       ``(A) In general.--The term `qualified facility' shall not 
     include any facility which produces electricity from gas 
     derived from the biodegradation of municipal solid waste if 
     such

[[Page 17902]]

     biodegradation occurred in a facility (within the meaning of 
     section 29) the production from which is allowed as a credit 
     under section 29 for the taxable year or any prior taxable 
     year.
       ``(B) Refined coal facilities.--The term `refined coal 
     production facility' shall not include any facility the 
     production from which is allowed as a credit under section 29 
     for the taxable year or any prior taxable year.''.
       (B) Subparagraph (C) of section 45(e)(8) is amended by 
     striking ``and (9)''.
       (5) Subclause (I) of section 168(e)(3)(B)(vi) is amended to 
     read as follows:

       ``(I) is described in subparagraph (A) of section 48(a)(3) 
     (or would be so described if `solar and wind' were 
     substituted for `solar' in clause (i) thereof and the last 
     sentence of such section did not apply to such 
     subparagraph),''.

       (6) Paragraph (4) of section 710(g) of the American Jobs 
     Creation Act of 2004 is amended by striking ``January 1, 
     2004'' and inserting ``January 1, 2005''.
       (g) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall take effect of the date 
     of the enactment of this Act.
       (2) Technical amendments.--The amendments made by 
     subsections (e) and (f) shall take effect as if included in 
     the amendments made by section 710 of the American Jobs 
     Creation Act of 2004.

     SEC. 1302. APPLICATION OF SECTION 45 CREDIT TO AGRICULTURAL 
                   COOPERATIVES.

       (a) In General.--Section 45(e) (relating to definitions and 
     special rules), as amended by this Act, is amended by adding 
     at the end the following:
       ``(11) Allocation of credit to patrons of agricultural 
     cooperative.--
       ``(A) Election to allocate.--
       ``(i) In general.--In the case of an eligible cooperative 
     organization, any portion of the credit determined under 
     subsection (a) for the taxable year may, at the election of 
     the organization, be apportioned among patrons of the 
     organization on the basis of the amount of business done by 
     the patrons during the taxable year.
       ``(ii) Form and effect of election.--An election under 
     clause (i) for any taxable year shall be made on a timely 
     filed return for such year. Such election, once made, shall 
     be irrevocable for such taxable year. Such election shall not 
     take effect unless the organization designates the 
     apportionment as such in a written notice mailed to its 
     patrons during the payment period described in section 
     1382(d).
       ``(B) Treatment of organizations and patrons.--The amount 
     of the credit apportioned to any patrons under subparagraph 
     (A)--
       ``(i) shall not be included in the amount determined under 
     subsection (a) with respect to the organization for the 
     taxable year, and
       ``(ii) shall be included in the amount determined under 
     subsection (a) for the first taxable year of each patron 
     ending on or after the last day of the payment period (as 
     defined in section 1382(d)) for the taxable year of the 
     organization or, if earlier, for the taxable year of each 
     patron ending on or after the date on which the patron 
     receives notice from the cooperative of the apportionment.
       ``(C) Special rules for decrease in credits for taxable 
     year.--If the amount of the credit of a cooperative 
     organization determined under subsection (a) for a taxable 
     year is less than the amount of such credit shown on the 
     return of the cooperative organization for such year, an 
     amount equal to the excess of--
       ``(i) such reduction, over
       ``(ii) the amount not apportioned to such patrons under 
     subparagraph (A) for the taxable year,

     shall be treated as an increase in tax imposed by this 
     chapter on the organization. Such increase shall not be 
     treated as tax imposed by this chapter for purposes of 
     determining the amount of any credit under this chapter.
       ``(D) Eligible cooperative defined.--For purposes of this 
     section the term `eligible cooperative' means a cooperative 
     organization described in section 1381(a) which is owned more 
     than 50 percent by agricultural producers or by entities 
     owned by agricultural producers. For this purpose an entity 
     owned by an agricultural producer is one that is more than 50 
     percent owned by agricultural producers.''.
       (b) Conforming Amendment.--The last sentence of section 
     55(c)(1) is amended by inserting ``45(e)(11)(C),'' after 
     ``section''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years of cooperative organizations 
     ending after the date of the enactment of this Act.

     SEC. 1303. CLEAN RENEWABLE ENERGY BONDS.

       (a) In General.--Part IV of subchapter A of chapter 1 
     (relating to credits against tax) is amended by adding at the 
     end the following new subpart:

     ``Subpart H--Nonrefundable Credit to Holders of Certain Bonds

``Sec. 54. Credit to holders of clean renewable energy bonds.

     ``SEC. 54. CREDIT TO HOLDERS OF CLEAN RENEWABLE ENERGY BONDS.

       ``(a) Allowance of Credit.--If a taxpayer holds a clean 
     renewable energy bond on 1 or more credit allowance dates of 
     the bond occurring during any taxable year, there shall be 
     allowed as a credit against the tax imposed by this chapter 
     for the taxable year an amount equal to the sum of the 
     credits determined under subsection (b) with respect to such 
     dates.
       ``(b) Amount of Credit.--
       ``(1) In general.--The amount of the credit determined 
     under this subsection with respect to any credit allowance 
     date for a clean renewable energy bond is 25 percent of the 
     annual credit determined with respect to such bond.
       ``(2) Annual credit.--The annual credit determined with 
     respect to any clean renewable energy bond is the product 
     of--
       ``(A) the credit rate determined by the Secretary under 
     paragraph (3) for the day on which such bond was sold, 
     multiplied by
       ``(B) the outstanding face amount of the bond.
       ``(3) Determination.--For purposes of paragraph (2), with 
     respect to any clean renewable energy bond, the Secretary 
     shall determine daily or cause to be determined daily a 
     credit rate which shall apply to the first day on which there 
     is a binding, written contract for the sale or exchange of 
     the bond. The credit rate for any day is the credit rate 
     which the Secretary or the Secretary's designee estimates 
     will permit the issuance of clean renewable energy bonds with 
     a specified maturity or redemption date without discount and 
     without interest cost to the qualified issuer.
       ``(4) Credit allowance date.--For purposes of this section, 
     the term `credit allowance date' means--
       ``(A) March 15,
       ``(B) June 15,
       ``(C) September 15, and
       ``(D) December 15.
     Such term also includes the last day on which the bond is 
     outstanding.
       ``(5) Special rule for issuance and redemption.--In the 
     case of a bond which is issued during the 3-month period 
     ending on a credit allowance date, the amount of the credit 
     determined under this subsection with respect to such credit 
     allowance date shall be a ratable portion of the credit 
     otherwise determined based on the portion of the 3-month 
     period during which the bond is outstanding. A similar rule 
     shall apply when the bond is redeemed or matures.
       ``(c) Limitation Based on Amount of Tax.--The credit 
     allowed under subsection (a) for any taxable year shall not 
     exceed the excess of--
       ``(1) the sum of the regular tax liability (as defined in 
     section 26(b)) plus the tax imposed by section 55, over
       ``(2) the sum of the credits allowable under this part 
     (other than subpart C and this section).
       ``(d) Clean Renewable Energy Bond.--For purposes of this 
     section--
       ``(1) In general.--The term `clean renewable energy bond' 
     means any bond issued as part of an issue if--
       ``(A) the bond is issued by a qualified issuer pursuant to 
     an allocation by the Secretary to such issuer of a portion of 
     the national clean renewable energy bond limitation under 
     subsection (f)(2),
       ``(B) 95 percent or more of the proceeds of such issue are 
     to be used for capital expenditures incurred by qualified 
     borrowers for 1 or more qualified projects,
       ``(C) the qualified issuer designates such bond for 
     purposes of this section and the bond is in registered form, 
     and
       ``(D) the issue meets the requirements of subsection (h).
       ``(2) Qualified project; special use rules.--
       ``(A) In general.--The term `qualified project' means any 
     qualified facility (as determined under section 45(d) without 
     regard to paragraph (10) and to any placed in service date) 
     owned by a qualified borrower.
       ``(B) Refinancing rules.--For purposes of paragraph (1)(B), 
     a qualified project may be refinanced with proceeds of a 
     clean renewable energy bond only if the indebtedness being 
     refinanced (including any obligation directly or indirectly 
     refinanced by such indebtedness) was originally incurred by a 
     qualified borrower after the date of the enactment of this 
     section.
       ``(C) Reimbursement.--For purposes of paragraph (1)(B), a 
     clean renewable energy bond may be issued to reimburse a 
     qualified borrower for amounts paid after the date of the 
     enactment of this section with respect to a qualified 
     project, but only if--
       ``(i) prior to the payment of the original expenditure, the 
     qualified borrower declared its intent to reimburse such 
     expenditure with the proceeds of a clean renewable energy 
     bond,
       ``(ii) not later than 60 days after payment of the original 
     expenditure, the qualified issuer adopts an official intent 
     to reimburse the original expenditure with such proceeds, and
       ``(iii) the reimbursement is made not later than 18 months 
     after the date the original expenditure is paid.
       ``(D) Treatment of changes in use.--For purposes of 
     paragraph (1)(B), the proceeds of an issue shall not be 
     treated as used for a qualified project to the extent that a 
     qualified borrower or qualified issuer takes any action 
     within its control which causes such proceeds not to be used 
     for a qualified project. The Secretary shall prescribe 
     regulations specifying remedial actions that may be taken 
     (including conditions to taking such remedial actions) to 
     prevent an action described in the preceding sentence from 
     causing a bond to fail to be a clean renewable energy bond.
       ``(e) Maturity Limitations.--
       ``(1) Duration of term.--A bond shall not be treated as a 
     clean renewable energy bond if the maturity of such bond 
     exceeds the maximum term determined by the Secretary under 
     paragraph (2) with respect to such bond.
       ``(2) Maximum term.--During each calendar month, the 
     Secretary shall determine the maximum term permitted under 
     this paragraph for bonds issued during the following calendar 
     month. Such maximum term shall be the term

[[Page 17903]]

     which the Secretary estimates will result in the present 
     value of the obligation to repay the principal on the bond 
     being equal to 50 percent of the face amount of such bond. 
     Such present value shall be determined without regard to the 
     requirements of subsection (l)(6) and using as a discount 
     rate the average annual interest rate of tax-exempt 
     obligations having a term of 10 years or more which are 
     issued during the month. If the term as so determined is not 
     a multiple of a whole year, such term shall be rounded to the 
     next highest whole year.
       ``(f) Limitation on Amount of Bonds Designated.--
       ``(1) National limitation.--There is a national clean 
     renewable energy bond limitation of $800,000,000.
       ``(2) Allocation by secretary.--The Secretary shall 
     allocate the amount described in paragraph (1) among 
     qualified projects in such manner as the Secretary determines 
     appropriate, except that the Secretary may not allocate more 
     than $500,000,000 of the national clean renewable energy bond 
     limitation to finance qualified projects of qualified 
     borrowers which are governmental bodies.
       ``(g) Credit Included in Gross Income.--Gross income 
     includes the amount of the credit allowed to the taxpayer 
     under this section (determined without regard to subsection 
     (c)) and the amount so included shall be treated as interest 
     income.
       ``(h) Special Rules Relating to Expenditures.--
       ``(1) In general.--An issue shall be treated as meeting the 
     requirements of this subsection if, as of the date of 
     issuance, the qualified issuer reasonably expects--
       ``(A) at least 95 percent of the proceeds of such issue are 
     to be spent for 1 or more qualified projects within the 5-
     year period beginning on the date of issuance of the clean 
     energy bond,
       ``(B) a binding commitment with a third party to spend at 
     least 10 percent of the proceeds of such issue will be 
     incurred within the 6-month period beginning on the date of 
     issuance of the clean energy bond or, in the case of a clean 
     energy bond the proceeds of which are to be loaned to 2 or 
     more qualified borrowers, such binding commitment will be 
     incurred within the 6-month period beginning on the date of 
     the loan of such proceeds to a qualified borrower, and
       ``(C) such projects will be completed with due diligence 
     and the proceeds of such issue will be spent with due 
     diligence.
       ``(2) Extension of period.--Upon submission of a request 
     prior to the expiration of the period described in paragraph 
     (1)(A), the Secretary may extend such period if the qualified 
     issuer establishes that the failure to satisfy the 5-year 
     requirement is due to reasonable cause and the related 
     projects will continue to proceed with due diligence.
       ``(3) Failure to spend required amount of bond proceeds 
     within 5 years.--To the extent that less than 95 percent of 
     the proceeds of such issue are expended by the close of the 
     5-year period beginning on the date of issuance (or if an 
     extension has been obtained under paragraph (2), by the close 
     of the extended period), the qualified issuer shall redeem 
     all of the nonqualified bonds within 90 days after the end of 
     such period. For purposes of this paragraph, the amount of 
     the nonqualified bonds required to be redeemed shall be 
     determined in the same manner as under section 142.
       ``(i) Special Rules Relating to Arbitrage.--A bond which is 
     part of an issue shall not be treated as a clean renewable 
     energy bond unless, with respect to the issue of which the 
     bond is a part, the qualified issuer satisfies the arbitrage 
     requirements of section 148 with respect to proceeds of the 
     issue.
       ``(j) Cooperative Electric Company; Qualified Energy Tax 
     Credit Bond Lender; Governmental Body; Qualified Borrower.--
     For purposes of this section--
       ``(1) Cooperative electric company.--The term `cooperative 
     electric company' means a mutual or cooperative electric 
     company described in section 501(c)(12) or section 
     1381(a)(2)(C), or a not-for-profit electric utility which has 
     received a loan or loan guarantee under the Rural 
     Electrification Act.
       ``(2) Clean renewable energy bond lender.--The term `clean 
     renewable energy bond lender' means a lender which is a 
     cooperative which is owned by, or has outstanding loans to, 
     100 or more cooperative electric companies and is in 
     existence on February 1, 2002, and shall include any 
     affiliated entity which is controlled by such lender.
       ``(3) Governmental body.--The term `governmental body' 
     means any State, territory, possession of the United States, 
     the District of Columbia, Indian tribal government, and any 
     political subdivision thereof.
       ``(4) Qualified issuer.--The term `qualified issuer' 
     means--
       ``(A) a clean renewable energy bond lender,
       ``(B) a cooperative electric company, or
       ``(C) a governmental body.
       ``(5) Qualified borrower.--The term `qualified borrower' 
     means--
       ``(A) a mutual or cooperative electric company described in 
     section 501(c)(12) or 1381(a)(2)(C), or
       ``(B) a governmental body.
       ``(k) Special Rules Relating to Pool Bonds.--No portion of 
     a pooled financing bond may be allocable to any loan unless 
     the borrower has entered into a written loan commitment for 
     such portion prior to the issue date of such issue.
       ``(l) Other Definitions and Special Rules.--For purposes of 
     this section--
       ``(1) Bond.--The term `bond' includes any obligation.
       ``(2) Pooled financing bond.--The term `pooled financing 
     bond' shall have the meaning given such term by section 
     149(f)(4)(A).
       ``(3) Partnership; s corporation; and other pass-thru 
     entities.--
       ``(A) In general.--Under regulations prescribed by the 
     Secretary, in the case of a partnership, trust, S 
     corporation, or other pass-thru entity, rules similar to the 
     rules of section 41(g) shall apply with respect to the credit 
     allowable under subsection (a).
       ``(B) No basis adjustment.--In the case of a bond held by a 
     partnership or an S corporation, rules similar to the rules 
     under section 1397E(i) shall apply.
       ``(4) Bonds held by regulated investment companies.--If any 
     clean renewable energy bond is held by a regulated investment 
     company, the credit determined under subsection (a) shall be 
     allowed to shareholders of such company under procedures 
     prescribed by the Secretary.
       ``(5) Treatment for estimated tax purposes.--Solely for 
     purposes of sections 6654 and 6655, the credit allowed by 
     this section (determined without regard to subsection (c)) to 
     a taxpayer by reason of holding a clean renewable energy bond 
     on a credit allowance date shall be treated as if it were a 
     payment of estimated tax made by the taxpayer on such date.
       ``(6) Ratable principal amortization required.--A bond 
     shall not be treated as a clean renewable energy bond unless 
     it is part of an issue which provides for an equal amount of 
     principal to be paid by the qualified issuer during each 
     calendar year that the issue is outstanding.
       ``(7) Reporting.--Issuers of clean renewable energy bonds 
     shall submit reports similar to the reports required under 
     section 149(e).
       ``(m) Termination.--This section shall not apply with 
     respect to any bond issued after December 31, 2007.''.
       (b) Reporting.--Subsection (d) of section 6049 (relating to 
     returns regarding payments of interest) is amended by adding 
     at the end the following new paragraph:
       ``(8) Reporting of credit on clean renewable energy 
     bonds.--
       ``(A) In general.--For purposes of subsection (a), the term 
     `interest' includes amounts includible in gross income under 
     section 54(g) and such amounts shall be treated as paid on 
     the credit allowance date (as defined in section 54(b)(4)).
       ``(B) Reporting to corporations, etc.--Except as otherwise 
     provided in regulations, in the case of any interest 
     described in subparagraph (A), subsection (b)(4) shall be 
     applied without regard to subparagraphs (A), (H), (I), (J), 
     (K), and (L)(i) of such subsection.
       ``(C) Regulatory authority.--The Secretary may prescribe 
     such regulations as are necessary or appropriate to carry out 
     the purposes of this paragraph, including regulations which 
     require more frequent or more detailed reporting.''.
       (c) Conforming Amendments.--
       (1) The table of subparts for part IV of subchapter A of 
     chapter 1 is amended by adding at the end the following new 
     item:

    ``Subpart H. Nonrefundable Credit to Holders of Certain Bonds.''.

       (2) Section 1397E(c)(2) is amended by inserting ``, and 
     subpart H thereof'' after ``refundable credits''.
       (3) Subsection (h) of section 1397E is amended to read as 
     follows:
       ``(h) Credit Treated as Nonrefundable Bondholder Credit.--
     For purposes of this title, the credit allowed by this 
     section shall be treated as a credit allowable under subpart 
     H of part IV of subchapter A of this chapter.''.
       (4) Section 6401(b)(1) is amended by striking ``and G'' and 
     inserting ``G, and H''.
       (d) Issuance of Regulations.--The Secretary of Treasury 
     shall issue regulations required under section 54 of the 
     Internal Revenue Code of 1986 (as added by this section) not 
     later than 120 days after the date of the enactment of this 
     Act.
       (e) Effective Date.--The amendments made by this section 
     shall apply to bonds issued after December 31, 2005.

     SEC. 1304. TREATMENT OF INCOME OF CERTAIN ELECTRIC 
                   COOPERATIVES.

       (a) Elimination of Sunset on Treatment of Income From Open 
     Access and Nuclear Decommissioning Transactions.--Section 
     501(c)(12)(C) is amended by striking the last sentence.
       (b) Elimination of Sunset on Treatment of Income From Load 
     Loss Transactions.--Section 501(c)(12)(H) is amended by 
     striking clause (x).
       (c) Effective Date.--The amendments made by this section 
     shall take effect on the date of the enactment of this Act.

     SEC. 1305. DISPOSITIONS OF TRANSMISSION PROPERTY TO IMPLEMENT 
                   FERC RESTRUCTURING POLICY.

       (a) In General.--Section 451(i)(3) (defining qualifying 
     electric transmission transaction) is amended by striking 
     ``2007'' and inserting ``2008''.
       (b) Technical Amendment Related to Section 909 of the 
     American Jobs Creation Act of 2004.--Clause (ii) of section 
     451(i)(4)(B) is amended by striking ``the close of the period 
     applicable under subsection (a)(2)(B) as extended under 
     paragraph (2)'' and inserting ``December 31, 2007''.
       (c) Effective Dates.--
       (1) In general.--The amendment made by subsection (a) shall 
     apply to transactions occurring after the date of the 
     enactment of this Act.

[[Page 17904]]

       (2) Technical amendment.--The amendment made by subsection 
     (b) shall take effect as if included in the amendments made 
     by section 909 of the American Jobs Creation Act of 2004.

     SEC. 1306. CREDIT FOR PRODUCTION FROM ADVANCED NUCLEAR POWER 
                   FACILITIES.

       (a) In General.--Subpart D of part IV of subchapter A of 
     chapter 1 (relating to business related credits) is amended 
     by adding after section 45I the following new section:

     ``SEC. 45J. CREDIT FOR PRODUCTION FROM ADVANCED NUCLEAR POWER 
                   FACILITIES.

       ``(a) General Rule.--For purposes of section 38, the 
     advanced nuclear power facility production credit of any 
     taxpayer for any taxable year is equal to the product of--
       ``(1) 1.8 cents, multiplied by
       ``(2) the kilowatt hours of electricity--
       ``(A) produced by the taxpayer at an advanced nuclear power 
     facility during the 8-year period beginning on the date the 
     facility was originally placed in service, and
       ``(B) sold by the taxpayer to an unrelated person during 
     the taxable year.
       ``(b) National Limitation.--
       ``(1) In general.--The amount of credit which would (but 
     for this subsection and subsection (c)) be allowed with 
     respect to any facility for any taxable year shall not exceed 
     the amount which bears the same ratio to such amount of 
     credit as--
       ``(A) the national megawatt capacity limitation allocated 
     to the facility, bears to
       ``(B) the total megawatt nameplate capacity of such 
     facility.
       ``(2) Amount of national limitation.--The national megawatt 
     capacity limitation shall be 6,000 megawatts.
       ``(3) Allocation of limitation.--The Secretary shall 
     allocate the national megawatt capacity limitation in such 
     manner as the Secretary may prescribe.
       ``(4) Regulations.--Not later than 6 months after the date 
     of the enactment of this section, the Secretary shall 
     prescribe such regulations as may be necessary or appropriate 
     to carry out the purposes of this subsection. Such 
     regulations shall provide a certification process under which 
     the Secretary, after consultation with the Secretary of 
     Energy, shall approve and allocate the national megawatt 
     capacity limitation.
       ``(c) Other Limitations.--
       ``(1) Annual limitation.--The amount of the credit 
     allowable under subsection (a) (after the application of 
     subsection (b)) for any taxable year with respect to any 
     facility shall not exceed an amount which bears the same 
     ratio to $125,000,000 as--
       ``(A) the national megawatt capacity limitation allocated 
     under subsection (b) to the facility, bears to
       ``(B) 1,000.
       ``(2) Other limitations.--Rules similar to the rules of 
     section 45(b)(1) shall apply for purposes of this section.
       ``(d) Advanced Nuclear Power Facility.--For purposes of 
     this section--
       ``(1) In general.--The term `advanced nuclear power 
     facility' means any advanced nuclear facility--
       ``(A) which is owned by the taxpayer and which uses nuclear 
     energy to produce electricity, and
       ``(B) which is placed in service after the date of the 
     enactment of this paragraph and before January 1, 2021.
       ``(2) Advanced nuclear facility.--For purposes of paragraph 
     (1), the term `advanced nuclear facility' means any nuclear 
     facility the reactor design for which is approved after 
     December 31, 1993, by the Nuclear Regulatory Commission (and 
     such design or a substantially similar design of comparable 
     capacity was not approved on or before such date).
       ``(e) Other Rules To Apply.--Rules similar to the rules of 
     paragraphs (1), (2), (3), (4), and (5) of section 45(e) shall 
     apply for purposes of this section.''.
       (b) Credit Treated as Business Credit.--Section 38(b), as 
     amended by the Transportation Equity Act: A Legacy for Users, 
     is amended by striking ``plus'' at the end of paragraph (19), 
     by striking the period at the end of paragraph (20) and 
     inserting ``, plus'', and by adding at the end the following:
       ``(21) the advanced nuclear power facility production 
     credit determined under section 45J(a).''.
       (c) Clerical Amendment.--The table of sections for subpart 
     D of part IV of subchapter A of chapter 1 is amended by 
     adding at the end the following:

``Sec. 45J. Credit for production from advanced nuclear power 
              facilities.''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to production in taxable years beginning after 
     the date of the enactment of this Act.

     SEC. 1307. CREDIT FOR INVESTMENT IN CLEAN COAL FACILITIES.

       (a) In General.--Section 46 (relating to amount of credit) 
     is amended by striking ``and'' at the end of paragraph (1), 
     by striking the period at the end of paragraph (2), and by 
     adding at the end the following new paragraphs:
       ``(3) the qualifying advanced coal project credit, and
       ``(4) the qualifying gasification project credit.''.
       (b) Amount of Credits.--Subpart E of part IV of subchapter 
     A of chapter 1 (relating to rules for computing investment 
     credit) is amended by inserting after section 48 the 
     following new sections:

     ``SEC. 48A. QUALIFYING ADVANCED COAL PROJECT CREDIT.

       ``(a) In General.--For purposes of section 46, the 
     qualifying advanced coal project credit for any taxable year 
     is an amount equal to--
       ``(1) 20 percent of the qualified investment for such 
     taxable year in the case of projects described in subsection 
     (d)(3)(B)(i), and
       ``(2) 15 percent of the qualified investment for such 
     taxable year in the case of projects described in subsection 
     (d)(3)(B)(ii).
       ``(b) Qualified Investment.--
       ``(1) In general.--For purposes of subsection (a), the 
     qualified investment for any taxable year is the basis of 
     eligible property placed in service by the taxpayer during 
     such taxable year which is part of a qualifying advanced coal 
     project--
       ``(A)(i) the construction, reconstruction, or erection of 
     which is completed by the taxpayer, or
       ``(ii) which is acquired by the taxpayer if the original 
     use of such property commences with the taxpayer, and
       ``(B) with respect to which depreciation (or amortization 
     in lieu of depreciation) is allowable.
       ``(2) Special rule for certain subsidized property.--Rules 
     similar to section 48(a)(4) shall apply for purposes of this 
     section.
       ``(3) Certain qualified progress expenditures rules made 
     applicable.--Rules similar to the rules of subsections (c)(4) 
     and (d) of section 46 (as in effect on the day before the 
     enactment of the Revenue Reconciliation Act of 1990) shall 
     apply for purposes of this section.
       ``(c) Definitions.--For purposes of this section--
       ``(1) Qualifying advanced coal project.--The term 
     `qualifying advanced coal project' means a project which 
     meets the requirements of subsection (e).
       ``(2) Advanced coal-based generation technology.--The term 
     `advanced coal-based generation technology' means a 
     technology which meets the requirements of subsection (f).
       ``(3) Eligible property.--The term `eligible property' 
     means--
       ``(A) in the case of any qualifying advanced coal project 
     using an integrated gasification combined cycle, any property 
     which is a part of such project and is necessary for the 
     gasification of coal, including any coal handling and gas 
     separation equipment, and
       ``(B) in the case of any other qualifying advanced coal 
     project, any property which is a part of such project.
       ``(4) Coal.--The term `coal' means anthracite, bituminous 
     coal, subbituminous coal, lignite, and peat.
       ``(5) Greenhouse gas capture capability.--The term 
     `greenhouse gas capture capability' means an integrated 
     gasification combined cycle technology facility capable of 
     adding components which can capture, separate on a long-term 
     basis, isolate, remove, and sequester greenhouse gases which 
     result from the generation of electricity.
       ``(6) Electric generation unit.--The term `electric 
     generation unit' means any facility at least 50 percent of 
     the total annual net output of which is electrical power, 
     including an otherwise eligible facility which is used in an 
     industrial application.
       ``(7) Integrated gasification combined cycle.--The term 
     `integrated gasification combined cycle' means an electric 
     generation unit which produces electricity by converting coal 
     to synthesis gas which is used to fuel a combined-cycle plant 
     which produces electricity from both a combustion turbine 
     (including a combustion turbine/fuel cell hybrid) and a steam 
     turbine.
       ``(d) Qualifying Advanced Coal Project Program.--
       ``(1) Establishment.--Not later than 180 days after the 
     date of enactment of this section, the Secretary, in 
     consultation with the Secretary of Energy, shall establish a 
     qualifying advanced coal project program for the deployment 
     of advanced coal-based generation technologies.
       ``(2) Certification.--
       ``(A) Application period.--Each applicant for certification 
     under this paragraph shall submit an application meeting the 
     requirements of subparagraph (B). An applicant may only 
     submit an application during the 3-year period beginning on 
     the date the Secretary establishes the program under 
     paragraph (1).
       ``(B) Requirements for applications for certification.--An 
     application under subparagraph (A) shall contain such 
     information as the Secretary may require in order to make a 
     determination to accept or reject an application for 
     certification as meeting the requirements under subsection 
     (e)(1). Any information contained in the application shall be 
     protected as provided in section 552(b)(4) of title 5, United 
     States Code.
       ``(C) Time to act upon applications for certification.--The 
     Secretary shall issue a determination as to whether an 
     applicant has met the requirements under subsection (e)(1) 
     within 60 days following the date of submittal of the 
     application for certification.
       ``(D) Time to meet criteria for certification.--Each 
     applicant for certification shall have 2 years from the date 
     of acceptance by the Secretary of the application during 
     which to provide to the Secretary evidence that the criteria 
     set forth in subsection (e)(2) have been met.
       ``(E) Period of issuance.--An applicant which receives a 
     certification shall have 5 years from the date of issuance of 
     the certification in order to place the project in service 
     and if such project is not placed in service by that time 
     period then the certification shall no longer be valid.

[[Page 17905]]

       ``(3) Aggregate credits.--
       ``(A) In general.--The aggregate credits allowed under 
     subsection (a) for projects certified by the Secretary under 
     paragraph (2) may not exceed $1,300,000,000.
       ``(B) Particular projects.--Of the dollar amount in 
     subparagraph (A), the Secretary is authorized to certify--
       ``(i) $800,000,000 for integrated gasification combined 
     cycle projects, and
       ``(ii) $500,000,000 for projects which use other advanced 
     coal-based generation technologies.
       ``(4) Review and redistribution.--
       ``(A) Review.--Not later than 6 years after the date of 
     enactment of this section, the Secretary shall review the 
     credits allocated under this section as of the date which is 
     6 years after the date of enactment of this section.
       ``(B) Redistribution.--The Secretary may reallocate credits 
     available under clauses (i) and (ii) of paragraph (3)(B) if 
     the Secretary determines that--
       ``(i) there is an insufficient quantity of qualifying 
     applications for certification pending at the time of the 
     review, or
       ``(ii) any certification made pursuant to subsection 
     paragraph (2) has been revoked pursuant to subsection 
     paragraph (2)(D) because the project subject to the 
     certification has been delayed as a result of third party 
     opposition or litigation to the proposed project.
       ``(C) Reallocation.--If the Secretary determines that 
     credits under clause (i) or (ii) of paragraph (3)(B) are 
     available for reallocation pursuant to the requirements set 
     forth in paragraph (2), the Secretary is authorized to 
     conduct an additional program for applications for 
     certification.
       ``(e) Qualifying Advanced Coal Projects.--
       ``(1) Requirements.--For purposes of subsection (c)(1), a 
     project shall be considered a qualifying advanced coal 
     project that the Secretary may certify under subsection 
     (d)(2) if the Secretary determines that, at a minimum--
       ``(A) the project uses an advanced coal-based generation 
     technology--
       ``(i) to power a new electric generation unit, or
       ``(ii) to retrofit or repower an existing electric 
     generation unit (including an existing natural gas-fired 
     combined cycle unit),
       ``(B) the fuel input for the project, when completed, is at 
     least 75 percent coal,
       ``(C) the project, consisting of one or more electric 
     generation units at one site, will have a total nameplate 
     generating capacity of at least 400 megawatts;
       ``(D) the applicant provides evidence that a majority of 
     the output of the project is reasonably expected to be 
     acquired or utilized;
       ``(E) the applicant provides evidence of ownership or 
     control of a site of sufficient size to allow the proposed 
     project to be constructed and to operate on a long-term 
     basis; and
       ``(F) the project will be located in the United States.
       ``(2) Requirements for certification.--For the purpose of 
     subsection (d)(2)(D), a project shall be eligible for 
     certification only if the Secretary determines that--
       ``(A) the applicant for certification has received all 
     Federal and State environmental authorizations or reviews 
     necessary to commence construction of the project; and
       ``(B) the applicant for certification, except in the case 
     of a retrofit or repower of an existing electric generation 
     unit, has purchased or entered into a binding contract for 
     the purchase of the main steam turbine or turbines for the 
     project, except that such contract may be contingent upon 
     receipt of a certification under subsection (d)(2).
       ``(3) Priority for integrated gasification combined cycle 
     projects.--In determining which qualifying advanced coal 
     projects to certify under subsection (d)(2), the Secretary 
     shall--
       ``(A) certify capacity, in accordance with the procedures 
     set forth in subsection (d), in relatively equal amounts to--
       ``(i) projects using bituminous coal as a primary 
     feedstock,
       ``(ii) projects using subbituminous coal as a primary 
     feedstock, and
       ``(iii) projects using lignite as a primary feedstock, and
       ``(B) give high priority to projects which include, as 
     determined by the Secretary--
       ``(i) greenhouse gas capture capability,
       ``(ii) increased by-product utilization, and
       ``(iii) other benefits.
       ``(f) Advanced Coal-Based Generation Technology.--
       ``(1) In general.--For the purpose of this section, an 
     electric generation unit uses advanced coal-based generation 
     technology if--
       ``(A) the unit--
       ``(i) uses integrated gasification combined cycle 
     technology, or
       ``(ii) except as provided in paragraph (3), has a design 
     net heat rate of 8530 Btu/kWh (40 percent efficiency), and
       ``(B) the unit is designed to meet the performance 
     requirements in the following table:

Performance characteristic:                   Design level for project:
SO2 (percent removal).............................99 percent
NOx (emissions)...............................0.07 lbs/MMBTU
PM* (emissions).........................................0.015 lbs/MMBTU
Hg (percent removal).........................................90 percent

       ``(2) Design net heat rate.--For purposes of this 
     subsection, design net heat rate with respect to an electric 
     generation unit shall--
       ``(A) be measured in Btu per kilowatt hour (higher heating 
     value),
       ``(B) be based on the design annual heat input to the unit 
     and the rated net electrical power, fuels, and chemicals 
     output of the unit (determined without regard to the 
     cogeneration of steam by the unit),
       ``(C) be adjusted for the heat content of the design coal 
     to be used by the unit--
       ``(i) if the heat content is less than 13,500 Btu per 
     pound, but greater than 7,000 Btu per pound, according to the 
     following formula: design net heat rate = unit net heat rate 
     x [1-[((13,500-design coal heat content, Btu per pound)/
     1,000)* 0.013]], and
       ``(ii) if the heat content is less than or equal to 7,000 
     Btu per pound, according to the following formula: design net 
     heat rate = unit net heat rate x [1-[((13,500-design coal 
     heat content, Btu per pound)/1,000)* 0.018]], and
       ``(D) be corrected for the site reference conditions of--
       ``(i) elevation above sea level of 500 feet,
       ``(ii) air pressure of 14.4 pounds per square inch 
     absolute,
       ``(iii) temperature, dry bulb of 63/o/F,
       ``(iv) temperature, wet bulb of 54/o/F, and
       ``(v) relative humidity of 55 percent.
       ``(3) Existing units.--In the case of any electric 
     generation unit in existence on the date of the enactment of 
     this section, such unit uses advanced coal-based generation 
     technology if, in lieu of the requirements under paragraph 
     (1)(A)(ii), such unit achieves a minimum efficiency of 35 
     percent and an overall thermal design efficiency improvement, 
     compared to the efficiency of the unit as operated, of not 
     less than--
       ``(A) 7 percentage points for coal of more than 9,000 Btu,
       ``(B) 6 percentage points for coal of 7,000 to 9,000 Btu, 
     or
       ``(C) 4 percentage points for coal of less than 7,000 Btu.
       ``(g) Applicability.--No use of technology (or level of 
     emission reduction solely by reason of the use of the 
     technology), and no achievement of any emission reduction by 
     the demonstration of any technology or performance level, by 
     or at one or more facilities with respect to which a credit 
     is allowed under this section, shall be considered to 
     indicate that the technology or performance level is--
       ``(1) adequately demonstrated for purposes of section 111 
     of the Clean Air Act (42 U.S. C. 7411);
       ``(2) achievable for purposes of section 169 of that Act 
     (42 U.S. C. 7479); or
       ``(3) achievable in practice for purposes of section 171 of 
     such Act (42 U.S.C. 7501).

     ``SEC. 48B. QUALIFYING GASIFICATION PROJECT CREDIT.

       ``(a) In General.--For purposes of section 46, the 
     qualifying gasification project credit for any taxable year 
     is an amount equal to 20 percent of the qualified investment 
     for such taxable year.
       ``(b) Qualified Investment.--
       ``(1) In general.--For purposes of subsection (a), the 
     qualified investment for any taxable year is the basis of 
     eligible property placed in service by the taxpayer during 
     such taxable year which is part of a qualifying gasification 
     project--
       ``(A)(i) the construction, reconstruction, or erection of 
     which is completed by the taxpayer, or
       ``(ii) which is acquired by the taxpayer if the original 
     use of such property commences with the taxpayer, and
       ``(B) with respect to which depreciation (or amortization 
     in lieu of depreciation) is allowable.
       ``(2) Special rule for certain subsidized property.--Rules 
     similar to section 48(a)(4) shall apply for purposes of this 
     section.
       ``(3) Certain qualified progress expenditures rules made 
     applicable.--Rules similar to the rules of subsections (c)(4) 
     and (d) of section 46 (as in effect on the day before the 
     enactment of the Revenue Reconciliation Act of 1990) shall 
     apply for purposes of this section.
       ``(c) Definitions.--For purposes of this section--
       ``(1) Qualifying gasification project.--The term 
     `qualifying gasification project' means any project which--
       ``(A) employs gasification technology,
       ``(B) will be carried out by an eligible entity, and
       ``(C) any portion of the qualified investment of which is 
     certified under the qualifying gasification program as 
     eligible for credit under this section in an amount (not to 
     exceed $650,000,000) determined by the Secretary.
       ``(2) Gasification technology.--The term `gasification 
     technology' means any process which converts a solid or 
     liquid product from coal, petroleum residue, biomass, or 
     other materials which are recovered for their energy or 
     feedstock value into a synthesis gas composed primarily of 
     carbon monoxide and hydrogen for direct use or subsequent 
     chemical or physical conversion.
       ``(3) Eligible property.--The term `eligible property' 
     means any property which is a part of a qualifying 
     gasification project and is necessary for the gasification 
     technology of such project.
       ``(4) Biomass.--
       ``(A) In general.--The term `biomass' means any--
       ``(i) agricultural or plant waste,
       ``(ii) byproduct of wood or paper mill operations, 
     including lignin in spent pulping liquors, and
       ``(iii) other products of forestry maintenance.
       ``(B) Exclusion.--The term `biomass' does not include paper 
     which is commonly recycled.

[[Page 17906]]

       ``(5) Carbon capture capability.--The term `carbon capture 
     capability' means a gasification plant design which is 
     determined by the Secretary to reflect reasonable 
     consideration for, and be capable of, accommodating the 
     equipment likely to be necessary to capture carbon dioxide 
     from the gaseous stream, for later use or sequestration, 
     which would otherwise be emitted in the flue gas from a 
     project which uses a nonrenewable fuel.
       ``(6) Coal.--The term `coal' means anthracite, bituminous 
     coal, subbituminous coal, lignite, and peat.
       ``(7) Eligible entity.--The term `eligible entity' means 
     any person whose application for certification is principally 
     intended for use in a domestic project which employs domestic 
     gasification applications related to--
       ``(A) chemicals,
       ``(B) fertilizers,
       ``(C) glass,
       ``(D) steel,
       ``(E) petroleum residues,
       ``(F) forest products, and
       ``(G) agriculture, including feedlots and dairy operations.
       ``(8) Petroleum residue.--The term `petroleum residue' 
     means the carbonized product of high-boiling hydrocarbon 
     fractions obtained in petroleum processing.
       ``(d) Qualifying Gasification Project Program.--
       ``(1) In general.--Not later than 180 days after the date 
     of the enactment of this section, the Secretary, in 
     consultation with the Secretary of Energy, shall establish a 
     qualifying gasification project program to consider and award 
     certifications for qualified investment eligible for credits 
     under this section to qualifying gasification project 
     sponsors under this section. The total amounts of credit that 
     may be allocated under the program shall not exceed 
     $350,000,000 under rules similar to the rules of section 
     48A(d)(4).
       ``(2) Period of issuance.--A certificate of eligibility 
     under paragraph (1) may be issued only during the 10-fiscal 
     year period beginning on October 1, 2005.
       ``(3) Selection criteria.--The Secretary shall not make a 
     competitive certification award for qualified investment for 
     credit eligibility under this section unless the recipient 
     has documented to the satisfaction of the Secretary that--
       ``(A) the award recipient is financially viable without the 
     receipt of additional Federal funding associated with the 
     proposed project,
       ``(B) the recipient will provide sufficient information to 
     the Secretary for the Secretary to ensure that the qualified 
     investment is spent efficiently and effectively,
       ``(C) a market exists for the products of the proposed 
     project as evidenced by contracts or written statements of 
     intent from potential customers,
       ``(D) the fuels identified with respect to the gasification 
     technology for such project will comprise at least 90 percent 
     of the fuels required by the project for the production of 
     chemical feedstocks, liquid transportation fuels, or 
     coproduction of electricity,
       ``(E) the award recipient's project team is competent in 
     the construction and operation of the gasification technology 
     proposed, with preference given to those recipients with 
     experience which demonstrates successful and reliable 
     operations of the technology on domestic fuels so identified, 
     and
       ``(F) the award recipient has met other criteria 
     established and published by the Secretary.
       ``(e) Denial of Double Benefit.--A credit shall not be 
     allowed under this section for any qualified investment for 
     which a credit is allowed under section 48A.''.
       (c) Conforming Amendments.--
       (1) Section 49(a)(1)(C) is amended by striking ``and'' at 
     the end of clause (ii), by striking clause (iii), and by 
     adding after clause (ii) the following new clauses:
       ``(iii) the basis of any property which is part of a 
     qualifying advanced coal project under section 48A, and
       ``(iv) the basis of any property which is part of a 
     qualifying gasification project under section 48B.''.
       (2) The table of sections for subpart E of part IV of 
     subchapter A of chapter 1 is amended by inserting after the 
     item relating to section 48 the following new items:

``Sec. 48A. Qualifying advanced coal project credit.
``Sec. 48B. Qualifying gasification project credit.''.

       (d) Effective Date.--The amendments made by this section 
     shall apply to periods after the date of the enactment of 
     this Act, under rules similar to the rules of section 48(m) 
     of the Internal Revenue Code of 1986 (as in effect on the day 
     before the date of the enactment of the Revenue 
     Reconciliation Act of 1990).

     SEC. 1308. ELECTRIC TRANSMISSION PROPERTY TREATED AS 15-YEAR 
                   PROPERTY.

       (a) In General.--Subparagraph (E) of section 168(e)(3) 
     (relating to classification of certain property) is amended 
     by striking ``and'' at the end of clause (v), by striking the 
     period at the end of clause (vi) and inserting ``, and'', and 
     by adding at the end the following new clause:
       ``(vii) any section 1245 property (as defined in section 
     1245(a)(3)) used in the transmission at 69 or more kilovolts 
     of electricity for sale and the original use of which 
     commences with the taxpayer after April 11, 2005.''.
       (b) Alternative System.--The table contained in section 
     168(g)(3)(B) (relating to special rule for certain property 
     assigned to classes) is amended by inserting after the item 
     relating to subparagraph (E)(vi) the following new item:

``(E)(vii)........................................................30''.

       (c) Effective Date.--
       (1) In general.--The amendments made by this section shall 
     apply to property placed in service after April 11, 2005.
       (2) Exception.--The amendments made by this section shall 
     not apply to any property with respect to which the taxpayer 
     or a related party has entered into a binding contract for 
     the construction thereof on or before April 11, 2005, or, in 
     the case of self-constructed property, has started 
     construction on or before such date.

     SEC. 1309. EXPANSION OF AMORTIZATION FOR CERTAIN ATMOSPHERIC 
                   POLLUTION CONTROL FACILITIES IN CONNECTION WITH 
                   PLANTS FIRST PLACED IN SERVICE AFTER 1975.

       (a) Eligibility of Post-1975 Pollution Control 
     Facilities.--Subsection (d) of section 169 (relating to 
     definitions) is amended by adding at the end the following:
       ``(5) Special rule relating to certain atmospheric 
     pollution control facilities.--In the case of any atmospheric 
     pollution control facility which is placed in service after 
     April 11, 2005, and used in connection with an electric 
     generation plant or other property which is primarily coal 
     fired--
       ``(A) paragraph (1) shall be applied without regard to the 
     phrase `in operation before January 1, 1976', and
       ``(B) this section shall be applied by substituting `84' 
     for `60' each place it appears in subsections (a) and (b).''.
       (b) Treatment as New Identifiable Treatment Facility.--
     Subparagraph (B) of section 169(d)(4) is amended to read as 
     follows:
       ``(B) Certain facilities placed in operation after april 
     11, 2005.--In the case of any facility described in paragraph 
     (1) solely by reason of paragraph (5), subparagraph (A) shall 
     be applied by substituting `April 11, 2005' for `December 31, 
     1968' each place it appears therein.''.
       (c) Conforming Amendment.--The heading for section 169(d) 
     is amended by inserting ``and Special Rules'' after 
     ``Definitions''.
       (d) Technical Amendment.--Section 169(d)(3) is amended by 
     striking ``Health, Education, and Welfare'' and inserting 
     ``Health and Human Services''.
       (e) Effective Date.--The amendments made by this section 
     shall apply to facilities placed in service after April 11, 
     2005.

     SEC. 1310. MODIFICATIONS TO SPECIAL RULES FOR NUCLEAR 
                   DECOMMISSIONING COSTS.

       (a) Repeal of Limitation on Deposits Into Fund Based on 
     Cost of Service; Contributions After Funding Period.--
     Subsection (b) of section 468A (relating to special rules for 
     nuclear decommissioning costs) is amended to read as follows:
       ``(b) Limitation on Amounts Paid Into Fund.--The amount 
     which a taxpayer may pay into the Fund for any taxable year 
     shall not exceed the ruling amount applicable to such taxable 
     year.''.
       (b) Treatment of Certain Decommissioning Costs.--
       (1) In general.--Section 468A is amended by redesignating 
     subsections (f) and (g) as subsections (g) and (h), 
     respectively, and by inserting after subsection (e) the 
     following new subsection:
       ``(f) Transfers Into Qualified Funds.--
       ``(1) In general.--Notwithstanding subsection (b), any 
     taxpayer maintaining a Fund to which this section applies 
     with respect to a nuclear power plant may transfer into such 
     Fund not more than an amount equal to the present value of 
     the portion of the total nuclear decommissioning costs with 
     respect to such nuclear power plant previously excluded for 
     such nuclear power plant under subsection (d)(2)(A) as in 
     effect immediately before the date of the enactment of this 
     subsection.
       ``(2) Deduction for amounts transferred.--
       ``(A) In general.--Except as provided in subparagraph (C), 
     the deduction allowed by subsection (a) for any transfer 
     permitted by this subsection shall be allowed ratably over 
     the remaining estimated useful life (within the meaning of 
     subsection (d)(2)(A)) of the nuclear power plant beginning 
     with the taxable year during which the transfer is made.
       ``(B) Denial of deduction for previously deducted 
     amounts.--No deduction shall be allowed for any transfer 
     under this subsection of an amount for which a deduction was 
     previously allowed to the taxpayer (or a predecessor) or a 
     corresponding amount was not included in gross income of the 
     taxpayer (or a predecessor). For purposes of the preceding 
     sentence, a ratable portion of each transfer shall be treated 
     as being from previously deducted or excluded amounts to the 
     extent thereof.
       ``(C) Transfers of qualified funds.--If--
       ``(i) any transfer permitted by this subsection is made to 
     any Fund to which this section applies, and
       ``(ii) such Fund is transferred thereafter,
     any deduction under this subsection for taxable years ending 
     after the date that such Fund is transferred shall be allowed 
     to the transferor for the taxable year which includes such 
     date.
       ``(D) Special rules.--
       ``(i) Gain or loss not recognized on transfers to fund.--No 
     gain or loss shall be recognized on any transfer described in 
     paragraph (1).
       ``(ii) Transfers of appreciated property to fund.--If 
     appreciated property is transferred in a transfer described 
     in paragraph (1), the

[[Page 17907]]

     amount of the deduction shall not exceed the adjusted basis 
     of such property.
       ``(3) New ruling amount required.--Paragraph (1) shall not 
     apply to any transfer unless the taxpayer requests from the 
     Secretary a new schedule of ruling amounts in connection with 
     such transfer.
       ``(4) No basis in qualified funds.--Notwithstanding any 
     other provision of law, the taxpayer's basis in any Fund to 
     which this section applies shall not be increased by reason 
     of any transfer permitted by this subsection.''.
       (2) New ruling amount to take into account total costs.--
     Subparagraph (A) of section 468A(d)(2) (defining ruling 
     amount) is amended to read as follows:
       ``(A) fund the total nuclear decommissioning costs with 
     respect to such power plant over the estimated useful life of 
     such power plant, and''.
       (c) New Ruling Amount Required Upon License Renewal.--
     Paragraph (1) of section 468A(d) (relating to request 
     required) is amended by adding at the end the following new 
     sentence: ``For purposes of the preceding sentence, the 
     taxpayer shall request a schedule of ruling amounts upon each 
     renewal of the operating license of the nuclear 
     powerplant.''.
       (d) Conforming Amendment.--Section 468A(e)(3) (relating to 
     review of amount) is amended by striking ``The Fund'' and 
     inserting ``Except as provided in subsection (f), the Fund''.
       (e) Technical Amendments.--Section 468A(e)(2) (relating to 
     taxation of Fund) is amended--
       (1) by striking ``rate set forth in subparagraph (B)'' in 
     subparagraph (A) and inserting ``rate of 20 percent'',
       (2) by striking subparagraph (B), and
       (3) by redesignating subparagraphs (C) and (D) as 
     subparagraphs (B) and (C), respectively.
       (f) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2005.

     SEC. 1311. 5-YEAR NET OPERATING LOSS CARRYOVER FOR CERTAIN 
                   LOSSES.

       Paragraph (1) of section 172(b) (relating to net operating 
     loss carrybacks and carryovers) is amended by adding at the 
     end the following new subparagraph:
       ``(I) Transmission property and pollution control 
     investment.--
       ``(i) In general.--At the election of the taxpayer in any 
     taxable year ending after December 31, 2005, and before 
     January 1, 2009, in the case of a net operating loss in a 
     taxable year ending after December 31, 2002, and before 
     January 1, 2006, there shall be a net operating loss 
     carryback to each of the 5 years preceding the taxable year 
     of such loss to the extent that such loss does not exceed 20 
     percent of the sum of electric transmission property capital 
     expenditures and pollution control facility capital 
     expenditures of the taxpayer for the taxable year preceding 
     the taxable year in which such election is made.
       ``(ii) Limitations.--For purposes of this subsection--

       ``(I) not more than one election may be made under clause 
     (i) with respect to any net operating loss in a taxable year, 
     and
       ``(II) an election may not be made under clause (i) for 
     more than 1 taxable year beginning in any calendar year.

       ``(iii) Coordination with ordering rule.--For purposes of 
     applying subsection (b)(2), the portion of any loss which is 
     carried back 5 years by reason of clause (i) shall be treated 
     in a manner similar to the manner in which a specified 
     liability loss is treated.
       ``(iv) Application for adjustment.--In the case of any 
     portion of a net operating loss to which an election under 
     clause (i) applies, an application under section 6411(a) with 
     respect to such loss shall not fail to be treated as timely 
     filed if filed within 24 months after the due date specified 
     under such section.
       ``(v) Special rules relating to refund.--For purposes of a 
     net operating loss to which an election under clause (i) 
     applies, references in sections 6501(h), 6511(d)(2)(A), and 
     6611(f)(1) to the taxable year in which such net operating 
     loss arises or result in a net loss carryback shall be 
     treated as references to the taxable year in which such 
     election occurs.
       ``(vi) Definitions.--For purposes of this subparagraph--

       ``(I) Electric transmission property capital 
     expenditures.--The term `electric transmission property 
     capital expenditures' means any expenditure, chargeable to 
     capital account, made by the taxpayer which is attributable 
     to electric transmission property used by the taxpayer in the 
     transmission at 69 or more kilovolts of electricity for sale. 
     Such term shall not include any expenditure which may be 
     refunded or the purpose of which may be modified at the 
     option of the taxpayer so as to cease to be treated as an 
     expenditure within the meaning of such term.
       ``(II) Pollution control facility capital expenditures.--
     The term `pollution control facility capital expenditures' 
     means any expenditure, chargeable to capital account, made by 
     an electric utility company (as defined in section 2(3) of 
     the Public Utility Holding Company Act (15 U.S.C. 79b(3)), as 
     in effect on the day before the date of the enactment of the 
     Energy Tax Incentives Act of 2005) which is attributable to a 
     facility which will qualify as a certified pollution control 
     facility as determined under section 169(d)(1) by striking 
     `before January 1, 1976,' and by substituting `an 
     identifiable' for `a new identifiable'. Such term shall not 
     include any expenditure which may be refunded or the purpose 
     of which may be modified at the option of the taxpayer so as 
     to cease to be treated as an expenditure within the meaning 
     of such term.''.

               Subtitle B--Domestic Fossil Fuel Security

     SEC. 1321. EXTENSION OF CREDIT FOR PRODUCING FUEL FROM A 
                   NONCONVENTIONAL SOURCE FOR FACILITIES PRODUCING 
                   COKE OR COKE GAS.

       (a) In General.--Section 29 (relating to credit for 
     producing fuel from a nonconventional source) is amended by 
     adding at the end the following new subsection:
       ``(h) Extension for Facilities Producing Coke or Coke 
     Gas.--Notwithstanding subsection (f)--
       ``(1) In general.--In the case of a facility for producing 
     coke or coke gas which was placed in service before January 
     1, 1993, or after June 30, 1998, and before January 1, 2010, 
     this section shall apply with respect to coke and coke gas 
     produced in such facility and sold during the period--
       ``(A) beginning on the later of January 1, 2006, or the 
     date that such facility is placed in service, and
       ``(B) ending on the date which is 4 years after the date 
     such period began.
       ``(2) Special rules.--In determining the amount of credit 
     allowable under this section solely by reason of this 
     subsection--
       ``(A) Daily limit.--The amount of qualified fuels sold 
     during any taxable year which may be taken into account by 
     reason of this subsection with respect to any facility shall 
     not exceed an average barrel-of-oil equivalent of 4,000 
     barrels per day. Days before the date the facility is placed 
     in service shall not be taken into account in determining 
     such average.
       ``(B) Extension period to commence with unadjusted credit 
     amount.--For purposes of applying subsection (b)(2) to the $3 
     amount in subsection (a), in the case of fuels sold after 
     2005, subsection (d)(2)(B) shall be applied by substituting 
     `2004' for `1979'.
       ``(C) Denial of double benefit.--This subsection shall not 
     apply to any facility producing qualified fuels for which a 
     credit was allowed under this section for the taxable year or 
     any preceding taxable year by reason of subsection (g).''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to fuel produced and sold after December 31, 
     2005, in taxable years ending after such date.

     SEC. 1322. MODIFICATION OF CREDIT FOR PRODUCING FUEL FROM A 
                   NONCONVENTIONAL SOURCE.

       (a) Treatment as Business Credit.--
       (1) Credit moved to subpart relating to business related 
     credits.--The Internal Revenue Code of 1986 is amended by 
     redesignating section 29 as section 45K and by moving section 
     45K (as so redesignated) from subpart B of part IV of 
     subchapter A of chapter 1 to the end of subpart D of part IV 
     of subchapter A of chapter 1.
       (2) Credit treated as business credit.--Section 38(b), as 
     amended by this Act, is amended by striking ``plus'' at the 
     end of paragraph (20), by striking the period at the end of 
     paragraph (21) and inserting ``, plus'', and by adding at the 
     end the following:
       ``(22) the nonconventional source production credit 
     determined under section 45K(a).''.
       (3) Conforming amendments.--
       (A) Section 30(b)(3)(A) is amended by striking ``sections 
     27 and 29'' and inserting ``section 27''.
       (B) Sections 43(b)(2), 45I(b)(2)(C)(i), and 613A(c)(6)(C) 
     are each amended by striking ``section 29(d)(2)(C)'' and 
     inserting ``section 45K(d)(2)(C)''.
       (C) Section 45(e)(9), as added by this Act, is amended--
       (i) by striking ``section 29'' each place it appears and 
     inserting ``section 45K'', and
       (ii) by inserting ``(or under section 29, as in effect on 
     the day before the date of enactment of the Energy Tax 
     Incentives Act of 2005, for any prior taxable year)'' before 
     the period at the end thereof.
       (D) Section 45I is amended--
       (i) in subsection (c)(2)(A) by striking ``section 
     29(d)(5))'' and inserting ``section 45K(d)(5))'', and
       (ii) in subsection (d)(3) by striking ``section 29'' both 
     places it appears and inserting ``section 45K''.
       (E) Section 45K(a), as redesignated by paragraph (1), is 
     amended by striking ``There shall be allowed as a credit 
     against the tax imposed by this chapter for the taxable 
     year'' and inserting ``For purposes of section 38, if the 
     taxpayer elects to have this section apply, the 
     nonconventional source production credit determined under 
     this section for the taxable year is''.
       (F) Section 45K(b), as so redesignated, is amended by 
     striking paragraph (6).
       (G) Section 53(d)(1)(B)(iii) is amended by striking ``under 
     section 29'' and all that follows through ``or not allowed''.
       (H) Section 55(c)(3) is amended by striking ``29(b)(6),''.
       (I) Subsection (a) of section 772 is amended by inserting 
     ``and'' at the end of paragraph (9), by striking paragraph 
     (10), and by redesignating paragraph (11) as paragraph (10).
       (J) Paragraph (5) of section 772(d) is amended by striking 
     ``the foreign tax credit, and the credit allowable under 
     section 29'' and inserting ``and the foreign tax credit''.
       (K) The table of sections for subpart B of part IV of 
     subchapter A of chapter 1 is amended by striking the item 
     relating to section 29.
       (L) The table of sections for subpart D of part IV of 
     subchapter A of chapter 1 is amended by inserting after the 
     item relating to section 45I the following new item:

``Sec. 45K. Credit for producing fuel from a nonconventional source.''.

[[Page 17908]]

       (b) Amendments Conforming to the Repeal of the Natural Gas 
     Policy Act of 1978.--
       (1) In general.--Section 29(c)(2)(A) (before redesignation 
     under subsection (a) and as amended by section 1321) is 
     amended--
       (A) by inserting ``(as in effect before the repeal of such 
     section)'' after ``1978'', and
       (B) by striking subsection (e) and redesignating 
     subsections (f), (g), and (h) as subsections (e), (f), and 
     (g), respectively.
       (2) Conforming amendments.--Section 29(g)(1)(before 
     redesignation under subsection (a) and paragraph (1) of this 
     subsection) is amended--
       (A) in subparagraph (A) by striking ``subsection 
     (f)(1)(B)'' and inserting ``subsection (e)(1)(B)'', and
       (B) in subparagraph (B) by striking ``subsection (f)'' and 
     inserting ``subsection (e)''.
       (c) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply to credits 
     determined under the Internal Revenue Code of 1986 for 
     taxable years ending after December 31, 2005.
       (2) Subsection (b).--The amendments made by subsection (b) 
     shall take effect on the date of the enactment of this Act.

     SEC. 1323. TEMPORARY EXPENSING FOR EQUIPMENT USED IN REFINING 
                   OF LIQUID FUELS.

       (a) In General.--Part VI of subchapter B of chapter 1 is 
     amended by inserting after section 179B the following new 
     section:

     ``SEC. 179C. ELECTION TO EXPENSE CERTAIN REFINERIES.

       ``(a) Treatment as Expenses.--A taxpayer may elect to treat 
     50 percent of the cost of any qualified refinery property as 
     an expense which is not chargeable to capital account. Any 
     cost so treated shall be allowed as a deduction for the 
     taxable year in which the qualified refinery property is 
     placed in service.
       ``(b) Election.--
       ``(1) In general.--An election under this section for any 
     taxable year shall be made on the taxpayer's return of the 
     tax imposed by this chapter for the taxable year. Such 
     election shall be made in such manner as the Secretary may by 
     regulations prescribe.
       ``(2) Election irrevocable.--Any election made under this 
     section may not be revoked except with the consent of the 
     Secretary.
       ``(c) Qualified Refinery Property.--
       ``(1) In general.--The term `qualified refinery property' 
     means any portion of a qualified refinery--
       ``(A) the original use of which commences with the 
     taxpayer,
       ``(B) which is placed in service by the taxpayer after the 
     date of the enactment of this section and before January 1, 
     2012,
       ``(C) in the case any portion of a qualified refinery 
     (other than a qualified refinery which is separate from any 
     existing refinery), which meets the requirements of 
     subsection (e),
       ``(D) which meets all applicable environmental laws in 
     effect on the date such portion was placed in service,
       ``(E) no written binding contract for the construction of 
     which was in effect on or before June 14, 2005, and
       ``(F)(i) the construction of which is subject to a written 
     binding construction contract entered into before January 1, 
     2008,
       ``(ii) which is placed in service before January 1, 2008, 
     or
       ``(iii) in the case of self-constructed property, the 
     construction of which began after June 14, 2005, and before 
     January 1, 2008.
       ``(2) Special rule for sale-leasebacks.--For purposes of 
     paragraph (1)(A), if property is--
       ``(A) originally placed in service after the date of the 
     enactment of this section by a person, and
       ``(B) sold and leased back by such person within 3 months 
     after the date such property was originally placed in 
     service,
     such property shall be treated as originally placed in 
     service not earlier than the date on which such property is 
     used under the leaseback referred to in subparagraph (B).
       ``(3) Effect of waiver under clean air act.--A waiver under 
     the Clean Air Act shall not be taken into account in 
     determining whether the requirements of paragraph (1)(D) are 
     met.
       ``(d) Qualified Refinery.--For purposes of this section, 
     the term `qualified refinery' means any refinery located in 
     the United States which is designed to serve the primary 
     purpose of processing liquid fuel from crude oil or qualified 
     fuels (as defined in section 45K(c)).
       ``(e) Production Capacity.--The requirements of this 
     subsection are met if the portion of the qualified refinery--
       ``(1) enables the existing qualified refinery to increase 
     total volume output (determined without regard to asphalt or 
     lube oil) by 5 percent or more on an average daily basis, or
       ``(2) enables the existing qualified refinery to process 
     qualified fuels (as defined in section 45K(c)) at a rate 
     which is equal to or greater than 25 percent of the total 
     throughput of such qualified refinery on an average daily 
     basis.
       ``(f) Ineligible Refinery Property.--No deduction shall be 
     allowed under subsection (a) for any qualified refinery 
     property--
       ``(1) the primary purpose of which is for use as a topping 
     plant, asphalt plant, lube oil facility, crude or product 
     terminal, or blending facility, or
       ``(2) which is built solely to comply with consent decrees 
     or projects mandated by Federal, State, or local governments.
       ``(g) Election to Allocate Deduction to Cooperative 
     Owner.--
       ``(1) In general.--If--
       ``(A) a taxpayer to which subsection (a) applies is an 
     organization to which part I of subchapter T applies, and
       ``(B) one or more persons directly holding an ownership 
     interest in the taxpayer are organizations to which part I of 
     subchapter T apply,
     the taxpayer may elect to allocate all or a portion of the 
     deduction allowable under subsection (a) to such persons. 
     Such allocation shall be equal to the person's ratable share 
     of the total amount allocated, determined on the basis of the 
     person's ownership interest in the taxpayer. The taxable 
     income of the taxpayer shall not be reduced under section 
     1382 by reason of any amount to which the preceding sentence 
     applies.
       ``(2) Form and effect of election.--An election under 
     paragraph (1) for any taxable year shall be made on a timely 
     filed return for such year. Such election, once made, shall 
     be irrevocable for such taxable year.
       ``(3) Written notice to owners.--If any portion of the 
     deduction available under subsection (a) is allocated to 
     owners under paragraph (1), the cooperative shall provide any 
     owner receiving an allocation written notice of the amount of 
     the allocation. Such notice shall be provided before the date 
     on which the return described in paragraph (2) is due.
       ``(h) Reporting.--No deduction shall be allowed under 
     subsection (a) to any taxpayer for any taxable year unless 
     such taxpayer files with the Secretary a report containing 
     such information with respect to the operation of the 
     refineries of the taxpayer as the Secretary shall require.''.
       (b) Conforming Amendments.--
       (1) Section 1245(a) is amended by inserting ``179C,'' after 
     ``179B,'' both places it appears in paragraphs (2)(C) and 
     (3)(C).
       (2) Section 263(a)(1) is amended by striking ``or'' at the 
     end of subparagraph (H), by striking the period at the end of 
     subparagraph (I) and inserting ``, or'', and by inserting 
     after subparagraph (I) the following new subparagraph:
       ``(J) expenditures for which a deduction is allowed under 
     section 179C.''.
       (3) Section 312(k)(3)(B) is amended by striking ``179 179A, 
     or 179B'' each place it appears in the heading and text and 
     inserting ``179, 179A, 179B, or 179C''.
       (4) The table of sections for part VI of subchapter B of 
     chapter 1 is amended by inserting after the item relating to 
     section 179B the following new item:

``Sec. 179C. Election to expense certain refineries.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to properties placed in service after the date of 
     the enactment of this Act.

     SEC. 1324. PASS THROUGH TO OWNERS OF DEDUCTION FOR CAPITAL 
                   COSTS INCURRED BY SMALL REFINER COOPERATIVES IN 
                   COMPLYING WITH ENVIRONMENTAL PROTECTION AGENCY 
                   SULFUR REGULATIONS.

       (a) In General.--Section 179B (relating to deduction for 
     capital costs incurred in complying with Environmental 
     Protection Agency sulfur regulations) is amended by adding at 
     the end the following new subsection:
       ``(e) Election to Allocate Deduction to Cooperative 
     Owner.--
       ``(1) In general.--If--
       ``(A) a small business refiner to which subsection (a) 
     applies is an organization to which part I of subchapter T 
     applies, and
       ``(B) one or more persons directly holding an ownership 
     interest in the refiner are organizations to which part I of 
     subchapter T apply,
     the refiner may elect to allocate all or a portion of the 
     deduction allowable under subsection (a) to such persons. 
     Such allocation shall be equal to the person's ratable share 
     of the total amount allocated, determined on the basis of the 
     person's ownership interest in the taxpayer. The taxable 
     income of the refiner shall not be reduced under section 1382 
     by reason of any amount to which the preceding sentence 
     applies.
       ``(2) Form and effect of election.--An election under 
     paragraph (1) for any taxable year shall be made on a timely 
     filed return for such year. Such election, once made, shall 
     be irrevocable for such taxable year.
       ``(3) Written notice to owners.--If any portion of the 
     deduction available under subsection (a) is allocated to 
     owners under paragraph (1), the cooperative shall provide any 
     owner receiving an allocation written notice of the amount of 
     the allocation. Such notice shall be provided before the date 
     on which the return described in paragraph (2) is due.''.
       (b) Effective Date.--The amendment made by this section 
     shall take effect as if included in the amendment made by 
     section 338(a) of the American Jobs Creation Act of 2004.

     SEC. 1325. NATURAL GAS DISTRIBUTION LINES TREATED AS 15-YEAR 
                   PROPERTY.

       (a) In General.--Section 168(e)(3)(E) (defining 15-year 
     property), as amended by this Act, is amended by striking 
     ``and'' at the end of clause (vi), by striking the period at 
     the end of clause (vii) and by inserting ``, and'', and by 
     adding at the end the following new clause:
       ``(viii) any natural gas distribution line the original use 
     of which commences with the taxpayer after April 11, 2005, 
     and which is placed in service before January 1, 2011.''.
       (b) Alternative System.--The table contained in section 
     168(g)(3)(B) (relating to special rule for certain property 
     assigned to classes), as amended by this Act, is amended by 
     inserting after the item relating to subparagraph (E)(vii) 
     the following new item:

``(E)(viii).......................................................35''.

       (c) Effective Date.--

[[Page 17909]]

       (1) In general.--The amendments made by this section shall 
     apply to property placed in service after April 11, 2005.
       (2) Exception.--The amendments made by this section shall 
     not apply to any property with respect to which the taxpayer 
     or a related party has entered into a binding contract for 
     the construction thereof on or before April 11, 2005, or, in 
     the case of self-constructed property, has started 
     construction on or before such date.

     SEC. 1326. NATURAL GAS GATHERING LINES TREATED AS 7-YEAR 
                   PROPERTY.

       (a) In General.--Subparagraph (C) of section 168(e)(3) 
     (relating to classification of certain property) is amended 
     by striking ``and'' at the end of clause (iii), by 
     redesignating clause (iv) as clause (v), and by inserting 
     after clause (iii) the following new clause:
       ``(iv) any natural gas gathering line the original use of 
     which commences with the taxpayer after April 11, 2005, 
     and''.
       (b) Natural Gas Gathering Line.--Subsection (i) of section 
     168 is amended by inserting after paragraph (16) the 
     following new paragraph:
       ``(17) Natural gas gathering line.--The term `natural gas 
     gathering line' means--
       ``(A) the pipe, equipment, and appurtenances determined to 
     be a gathering line by the Federal Energy Regulatory 
     Commission, and
       ``(B) the pipe, equipment, and appurtenances used to 
     deliver natural gas from the wellhead or a commonpoint to the 
     point at which such gas first reaches--
       ``(i) a gas processing plant,
       ``(ii) an interconnection with a transmission pipeline for 
     which a certificate as an interstate transmission pipeline 
     has been issued by the Federal Energy Regulatory Commission,
       ``(iii) an interconnection with an intrastate transmission 
     pipeline, or
       ``(iv) a direct interconnection with a local distribution 
     company, a gas storage facility, or an industrial 
     consumer.''.
       (c) Alternative System.--The table contained in section 
     168(g)(3)(B) (relating to special rule for certain property 
     assigned to classes), as amended by this Act, is amended by 
     inserting after the item relating to subparagraph (C)(iii) 
     the following new item:

``(C)(iv).........................................................14''.

       (d) Alternative Minimum Tax Exception.--Subparagraph (B) of 
     section 56(a)(1) is amended by inserting before the period 
     the following: ``, or in section 168(e)(3)(C)(iv)''.
       (e) Effective Date.--
       (1) In general.--The amendments made by this section shall 
     apply to property placed in service after April 11, 2005.
       (2) Exception.--The amendments made by this section shall 
     not apply to any property with respect to which the taxpayer 
     or a related party has entered into a binding contract for 
     the construction thereof on or before April 11, 2005, or, in 
     the case of self-constructed property, has started 
     construction on or before such date.

     SEC. 1327. ARBITRAGE RULES NOT TO APPLY TO PREPAYMENTS FOR 
                   NATURAL GAS.

       (a) In General.--Subsection (b) of section 148 (relating to 
     higher yielding investments) is amended by adding at the end 
     the following new paragraph:
       ``(4) Safe harbor for prepaid natural gas.--
       ``(A) In general.--The term `investment-type property' does 
     not include a prepayment under a qualified natural gas supply 
     contract.
       ``(B) Qualified natural gas supply contract.--For purposes 
     of this paragraph, the term `qualified natural gas supply 
     contract' means any contract to acquire natural gas for 
     resale by a utility owned by a governmental unit if the 
     amount of gas permitted to be acquired under the contract by 
     the utility during any year does not exceed the sum of--
       ``(i) the annual average amount during the testing period 
     of natural gas purchased (other than for resale) by customers 
     of such utility who are located within the service area of 
     such utility, and
       ``(ii) the amount of natural gas to be used to transport 
     the prepaid natural gas to the utility during such year.
       ``(C) Natural gas used to generate electricity.--Natural 
     gas used to generate electricity shall be taken into account 
     in determining the average under subparagraph (B)(i)--
       ``(i) only if the electricity is generated by a utility 
     owned by a governmental unit, and
       ``(ii) only to the extent that the electricity is sold 
     (other than for resale) to customers of such utility who are 
     located within the service area of such utility.
       ``(D) Adjustments for changes in customer base.--
       ``(i) New business customers.--If--

       ``(I) after the close of the testing period and before the 
     date of issuance of the issue, the utility owned by a 
     governmental unit enters into a contract to supply natural 
     gas (other than for resale) for a business use at a property 
     within the service area of such utility, and
       ``(II) the utility did not supply natural gas to such 
     property during the testing period or the ratable amount of 
     natural gas to be supplied under the contract is 
     significantly greater than the ratable amount of gas supplied 
     to such property during the testing period,

     then a contract shall not fail to be treated as a qualified 
     natural gas supply contract by reason of supplying the 
     additional natural gas under the contract referred to in 
     subclause (I).
       ``(ii) Lost customers.--The average under subparagraph 
     (B)(i) shall not exceed the annual amount of natural gas 
     reasonably expected to be purchased (other than for resale) 
     by persons who are located within the service area of such 
     utility and who, as of the date of issuance of the issue, are 
     customers of such utility.
       ``(E) Ruling requests.--The Secretary may increase the 
     average under subparagraph (B)(i) for any period if the 
     utility owned by the governmental unit establishes to the 
     satisfaction of the Secretary that, based on objective 
     evidence of growth in natural gas consumption or population, 
     such average would otherwise be insufficient for such period.
       ``(F) Adjustment for natural gas otherwise on hand.--
       ``(i) In general.--The amount otherwise permitted to be 
     acquired under the contract for any period shall be reduced 
     by--

       ``(I) the applicable share of natural gas held by the 
     utility on the date of issuance of the issue, and
       ``(II) the natural gas (not taken into account under 
     subclause (I)) which the utility has a right to acquire 
     during such period (determined as of the date of issuance of 
     the issue).

       ``(ii) Applicable share.--For purposes of the clause (i), 
     the term `applicable share' means, with respect to any 
     period, the natural gas allocable to such period if the gas 
     were allocated ratably over the period to which the 
     prepayment relates.
       ``(G) Intentional acts.--Subparagraph (A) shall cease to 
     apply to any issue if the utility owned by the governmental 
     unit engages in any intentional act to render the volume of 
     natural gas acquired by such prepayment to be in excess of 
     the sum of--
       ``(i) the amount of natural gas needed (other than for 
     resale) by customers of such utility who are located within 
     the service area of such utility, and
       ``(ii) the amount of natural gas used to transport such 
     natural gas to the utility.
       ``(H) Testing period.--For purposes of this paragraph, the 
     term `testing period' means, with respect to an issue, the 
     most recent 5 calendar years ending before the date of 
     issuance of the issue.
       ``(I) Service area.--For purposes of this paragraph, the 
     service area of a utility owned by a governmental unit shall 
     be comprised of--
       ``(i) any area throughout which such utility provided at 
     all times during the testing period--

       ``(I) in the case of a natural gas utility, natural gas 
     transmission or distribution services, and
       ``(II) in the case of an electric utility, electricity 
     distribution services,

       ``(ii) any area within a county contiguous to the area 
     described in clause (i) in which retail customers of such 
     utility are located if such area is not also served by 
     another utility providing natural gas or electricity 
     services, as the case may be, and
       ``(iii) any area recognized as the service area of such 
     utility under State or Federal law.''.
       (b) Private Loan Financing Test Not to Apply to Prepayments 
     for Natural Gas.--Paragraph (2) of section 141(c) (providing 
     exceptions to the private loan financing test) is amended by 
     striking ``or'' at the end of subparagraph (A), by striking 
     the period at the end of subparagraph (B) and inserting ``, 
     or'', and by adding at the end the following new 
     subparagraph:
       ``(C) is a qualified natural gas supply contract (as 
     defined in section 148(b)(4)).''.
       (c) Exception for Qualified Electric and Natural Gas Supply 
     Contracts.--Section 141(d) is amended by adding at the end 
     the following new paragraph:
       ``(7) Exception for qualified electric and natural gas 
     supply contracts.--The term `nongovernmental output property' 
     shall not include any contract for the prepayment of 
     electricity or natural gas which is not investment property 
     under section 148(b)(2).''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to obligations issued after the date of the 
     enactment of this Act.

     SEC. 1328. DETERMINATION OF SMALL REFINER EXCEPTION TO OIL 
                   DEPLETION DEDUCTION.

       (a) In General.--Paragraph (4) of section 613A(d) (relating 
     to limitations on application of subsection (c)) is amended 
     to read as follows:
       ``(4) Certain refiners excluded.--If the taxpayer or 1 or 
     more related persons engages in the refining of crude oil, 
     subsection (c) shall not apply to the taxpayer for a taxable 
     year if the average daily refinery runs of the taxpayer and 
     such persons for the taxable year exceed 75,000 barrels. For 
     purposes of this paragraph, the average daily refinery runs 
     for any taxable year shall be determined by dividing the 
     aggregate refinery runs for the taxable year by the number of 
     days in the taxable year.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years ending after the date of the 
     enactment of this Act.

     SEC. 1329. AMORTIZATION OF GEOLOGICAL AND GEOPHYSICAL 
                   EXPENDITURES.

       (a) In General.--Section 167 (relating to depreciation) is 
     amended by redesignating subsection (h) as subsection (i) and 
     by inserting after subsection (g) the following new 
     subsection:
       ``(h) Amortization of Geological and Geophysical 
     Expenditures.--
       ``(1) In general.--Any geological and geophysical expenses 
     paid or incurred in connection with the exploration for, or 
     development of, oil or gas within the United States (as 
     defined in section 638) shall be allowed as a deduction 
     ratably over the 24-month period beginning on the date that 
     such expense was paid or incurred.
       ``(2) Half-year convention.--For purposes of paragraph (1), 
     any payment paid or incurred

[[Page 17910]]

     during the taxable year shall be treated as paid or incurred 
     on the mid-point of such taxable year.
       ``(3) Exclusive method.--Except as provided in this 
     subsection, no depreciation or amortization deduction shall 
     be allowed with respect to such payments.
       ``(4) Treatment upon abandonment.--If any property with 
     respect to which geological and geophysical expenses are paid 
     or incurred is retired or abandoned during the 24-month 
     period described in paragraph (1), no deduction shall be 
     allowed on account of such retirement or abandonment and the 
     amortization deduction under this subsection shall continue 
     with respect to such payment.''.
       (b) Conforming Amendment.--Section 263A(c)(3) is amended by 
     inserting ``167(h),'' after ``under section''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to amounts paid or incurred in taxable years 
     beginning after the date of the enactment of this Act.
       Subtitle C--Conservation and Energy Efficiency Provisions

     SEC. 1331. ENERGY EFFICIENT COMMERCIAL BUILDINGS DEDUCTION.

       (a) In General.--Part VI of subchapter B of chapter 1 
     (relating to itemized deductions for individuals and 
     corporations), as amended by this Act, is amended by 
     inserting after section 179C the following new section:

     ``SEC. 179D. ENERGY EFFICIENT COMMERCIAL BUILDINGS DEDUCTION.

       ``(a) In General.--There shall be allowed as a deduction an 
     amount equal to the cost of energy efficient commercial 
     building property placed in service during the taxable year.
       ``(b) Maximum Amount of Deduction.--The deduction under 
     subsection (a) with respect to any building for any taxable 
     year shall not exceed the excess (if any) of--
       ``(1) the product of--
       ``(A) $1.80, and
       ``(B) the square footage of the building, over
       ``(2) the aggregate amount of the deductions under 
     subsection (a) with respect to the building for all prior 
     taxable years.
       ``(c) Definitions.--For purposes of this section--
       ``(1) Energy efficient commercial building property.--The 
     term `energy efficient commercial building property' means 
     property--
       ``(A) with respect to which depreciation (or amortization 
     in lieu of depreciation) is allowable,
       ``(B) which is installed on or in any building which is--
       ``(i) located in the United States, and
       ``(ii) within the scope of Standard 90.1-2001,
       ``(C) which is installed as part of--
       ``(i) the interior lighting systems,
       ``(ii) the heating, cooling, ventilation, and hot water 
     systems, or
       ``(iii) the building envelope, and
       ``(D) which is certified in accordance with subsection 
     (d)(6) as being installed as part of a plan designed to 
     reduce the total annual energy and power costs with respect 
     to the interior lighting systems, heating, cooling, 
     ventilation, and hot water systems of the building by 50 
     percent or more in comparison to a reference building which 
     meets the minimum requirements of Standard 90.1-2001 using 
     methods of calculation under subsection (d)(2).
       ``(2) Standard 90.1-2001.--The term `Standard 90.1-2001' 
     means Standard 90.1-2001 of the American Society of Heating, 
     Refrigerating, and Air Conditioning Engineers and the 
     Illuminating Engineering Society of North America (as in 
     effect on April 2, 2003).
       ``(d) Special Rules.--
       ``(1) Partial allowance.--
       ``(A) In general.--Except as provided in subsection (f), 
     if--
       ``(i) the requirement of subsection (c)(1)(D) is not met, 
     but
       ``(ii) there is a certification in accordance with 
     paragraph (6) that any system referred to in subsection 
     (c)(1)(C) satisfies the energy-savings targets established by 
     the Secretary under subparagraph (B) with respect to such 
     system,

     then the requirement of subsection (c)(1)(D) shall be treated 
     as met with respect to such system, and the deduction under 
     subsection (a) shall be allowed with respect to energy 
     efficient commercial building property installed as part of 
     such system and as part of a plan to meet such targets, 
     except that subsection (b) shall be applied to such property 
     by substituting `$.60' for `$1.80'.
       ``(B) Regulations.--The Secretary, after consultation with 
     the Secretary of Energy, shall establish a target for each 
     system described in subsection (c)(1)(C) which, if such 
     targets were met for all such systems, the building would 
     meet the requirements of subsection (c)(1)(D).
       ``(2) Methods of calculation.--The Secretary, after 
     consultation with the Secretary of Energy, shall promulgate 
     regulations which describe in detail methods for calculating 
     and verifying energy and power consumption and cost, based on 
     the provisions of the 2005 California Nonresidential 
     Alternative Calculation Method Approval Manual.
       ``(3) Computer software.--
       ``(A) In general.--Any calculation under paragraph (2) 
     shall be prepared by qualified computer software.
       ``(B) Qualified computer software.--For purposes of this 
     paragraph, the term `qualified computer software' means 
     software--
       ``(i) for which the software designer has certified that 
     the software meets all procedures and detailed methods for 
     calculating energy and power consumption and costs as 
     required by the Secretary,
       ``(ii) which provides such forms as required to be filed by 
     the Secretary in connection with energy efficiency of 
     property and the deduction allowed under this section, and
       ``(iii) which provides a notice form which documents the 
     energy efficiency features of the building and its projected 
     annual energy costs.
       ``(4) Allocation of deduction for public property.--In the 
     case of energy efficient commercial building property 
     installed on or in property owned by a Federal, State, or 
     local government or a political subdivision thereof, the 
     Secretary shall promulgate a regulation to allow the 
     allocation of the deduction to the person primarily 
     responsible for designing the property in lieu of the owner 
     of such property. Such person shall be treated as the 
     taxpayer for purposes of this section.
       ``(5) Notice to owner.--Each certification required under 
     this section shall include an explanation to the building 
     owner regarding the energy efficiency features of the 
     building and its projected annual energy costs as provided in 
     the notice under paragraph (3)(B)(iii).
       ``(6) Certification.--
       ``(A) In general.--The Secretary shall prescribe the manner 
     and method for the making of certifications under this 
     section.
       ``(B) Procedures.--The Secretary shall include as part of 
     the certification process procedures for inspection and 
     testing by qualified individuals described in subparagraph 
     (C) to ensure compliance of buildings with energy-savings 
     plans and targets. Such procedures shall be comparable, given 
     the difference between commercial and residential buildings, 
     to the requirements in the Mortgage Industry National 
     Accreditation Procedures for Home Energy Rating Systems.
       ``(C) Qualified individuals.--Individuals qualified to 
     determine compliance shall be only those individuals who are 
     recognized by an organization certified by the Secretary for 
     such purposes.
       ``(e) Basis Reduction.--For purposes of this subtitle, if a 
     deduction is allowed under this section with respect to any 
     energy efficient commercial building property, the basis of 
     such property shall be reduced by the amount of the deduction 
     so allowed.
       ``(f) Interim Rules for Lighting Systems.--Until such time 
     as the Secretary issues final regulations under subsection 
     (d)(1)(B) with respect to property which is part of a 
     lighting system--
       ``(1) In general.--The lighting system target under 
     subsection (d)(1)(A)(ii) shall be a reduction in lighting 
     power density of 25 percent (50 percent in the case of a 
     warehouse) of the minimum requirements in Table 9.3.1.1 or 
     Table 9.3.1.2 (not including additional interior lighting 
     power allowances) of Standard 90.1-2001.
       ``(2) Reduction in deduction if reduction less than 40 
     percent.--
       ``(A) In general.--If, with respect to the lighting system 
     of any building other than a warehouse, the reduction in 
     lighting power density of the lighting system is not at least 
     40 percent, only the applicable percentage of the amount of 
     deduction otherwise allowable under this section with respect 
     to such property shall be allowed.
       ``(B) Applicable percentage.--For purposes of subparagraph 
     (A), the applicable percentage is the number of percentage 
     points (not greater than 100) equal to the sum of--
       ``(i) 50, and
       ``(ii) the amount which bears the same ratio to 50 as the 
     excess of the reduction of lighting power density of the 
     lighting system over 25 percentage points bears to 15.
       ``(C) Exceptions.--This subsection shall not apply to any 
     system--
       ``(i) the controls and circuiting of which do not comply 
     fully with the mandatory and prescriptive requirements of 
     Standard 90.1-2001 and which do not include provision for 
     bilevel switching in all occupancies except hotel and motel 
     guest rooms, store rooms, restrooms, and public lobbies, or
       ``(ii) which does not meet the minimum requirements for 
     calculated lighting levels as set forth in the Illuminating 
     Engineering Society of North America Lighting Handbook, 
     Performance and Application, Ninth Edition, 2000.
       ``(g) Regulations.--The Secretary shall promulgate such 
     regulations as necessary--
       ``(1) to take into account new technologies regarding 
     energy efficiency and renewable energy for purposes of 
     determining energy efficiency and savings under this section, 
     and
       ``(2) to provide for a recapture of the deduction allowed 
     under this section if the plan described in subsection 
     (c)(1)(D) or (d)(1)(A) is not fully implemented.
       ``(h) Termination.--This section shall not apply with 
     respect to property placed in service after December 31, 
     2007.''.
       (b) Conforming Amendments.--
       (1) Section 1016(a) is amended by striking ``and'' at the 
     end of paragraph (30), by striking the period at the end of 
     paragraph (31) and inserting ``, and'', and by adding at the 
     end the following new paragraph:
       ``(32) to the extent provided in section 179D(e).''.
       (2) Section 1245(a), as amended by this Act, is amended by 
     inserting ``179D,'' after ``179C,'' both places it appears in 
     paragraphs (2)(C) and (3)(C).
       (3) Section 1250(b)(3) is amended by inserting before the 
     period at the end of the first sentence ``or by section 
     179D''.
       (4) Section 263(a)(1), as amended by this Act, is amended 
     by striking ``or'' at the end of subparagraph (I), by 
     striking the period at the end of subparagraph (J) and 
     inserting ``, or'', and

[[Page 17911]]

     by inserting after subparagraph (J) the following new 
     subparagraph:
       ``(K) expenditures for which a deduction is allowed under 
     section 179D.''.
       (5) Section 312(k)(3)(B), as amended by this Act, is 
     amended by striking ``179, 179A, 179B, or 179C'' each place 
     it appears in the heading and text and inserting ``179, 179A, 
     179B, 179C, or 179D''.
       (c) Clerical Amendment.--The table of sections for part VI 
     of subchapter B of chapter 1, as amended by this Act, is 
     amended by inserting after section 179C the following new 
     item:

``Sec. 179D. Energy efficient commercial buildings deduction.''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to property placed in service after December 31, 
     2005.

     SEC. 1332. CREDIT FOR CONSTRUCTION OF NEW ENERGY EFFICIENT 
                   HOMES.

       (a) In General.--Subpart D of part IV of subchapter A of 
     chapter 1 (relating to business related credits), as amended 
     by this Act, is amended by adding at the end the following 
     new section:

     ``SEC. 45L. NEW ENERGY EFFICIENT HOME CREDIT.

       ``(a) Allowance of Credit.--
       ``(1) In general.--For purposes of section 38, in the case 
     of an eligible contractor, the new energy efficient home 
     credit for the taxable year is the applicable amount for each 
     qualified new energy efficient home which is--
       ``(A) constructed by the eligible contractor, and
       ``(B) acquired by a person from such eligible contractor 
     for use as a residence during the taxable year.
       ``(2) Applicable amount.--For purposes of paragraph (1), 
     the applicable amount is an amount equal to--
       ``(A) in the case of a dwelling unit described in paragraph 
     (1) or (2) of subsection (c), $2,000, and
       ``(B) in the case of a dwelling unit described in paragraph 
     (3) of subsection (c), $1,000.
       ``(b) Definitions.--For purposes of this section--
       ``(1) Eligible contractor.--The term `eligible contractor' 
     means--
       ``(A) the person who constructed the qualified new energy 
     efficient home, or
       ``(B) in the case of a qualified new energy efficient home 
     which is a manufactured home, the manufactured home producer 
     of such home.
       ``(2) Qualified new energy efficient home.--The term 
     `qualified new energy efficient home' means a dwelling unit--
       ``(A) located in the United States,
       ``(B) the construction of which is substantially completed 
     after the date of the enactment of this section, and
       ``(C) which meets the energy saving requirements of 
     subsection (c).
       ``(3) Construction.--The term `construction' includes 
     substantial reconstruction and rehabilitation.
       ``(4) Acquire.--The term `acquire' includes purchase.
       ``(c) Energy Saving Requirements.--A dwelling unit meets 
     the energy saving requirements of this subsection if such 
     unit is--
       ``(1) certified--
       ``(A) to have a level of annual heating and cooling energy 
     consumption which is at least 50 percent below the annual 
     level of heating and cooling energy consumption of a 
     comparable dwelling unit--
       ``(i) which is constructed in accordance with the standards 
     of chapter 4 of the 2003 International Energy Conservation 
     Code, as such Code (including supplements) is in effect on 
     the date of the enactment of this section, and
       ``(ii) for which the heating and cooling equipment 
     efficiencies correspond to the minimum allowed under the 
     regulations established by the Department of Energy pursuant 
     to the National Appliance Energy Conservation Act of 1987 and 
     in effect at the time of completion of construction, and
       ``(B) to have building envelope component improvements 
     account for at least \1/5\ of such 50 percent,
       ``(2) a manufactured home which conforms to Federal 
     Manufactured Home Construction and Safety Standards (section 
     3280 of title 24, Code of Federal Regulations) and which 
     meets the requirements of paragraph (1), or
       ``(3) a manufactured home which conforms to Federal 
     Manufactured Home Construction and Safety Standards (section 
     3280 of title 24, Code of Federal Regulations) and which--
       ``(A) meets the requirements of paragraph (1) applied by 
     substituting `30 percent' for `50 percent' both places it 
     appears therein and by substituting `\1/3\' for `\1/5\' in 
     subparagraph (B) thereof, or
       ``(B) meets the requirements established by the 
     Administrator of the Environmental Protection Agency under 
     the Energy Star Labeled Homes program.
       ``(d) Certification.--
       ``(1) Method of certification.--A certification described 
     in subsection (c) shall be made in accordance with guidance 
     prescribed by the Secretary, after consultation with the 
     Secretary of Energy. Such guidance shall specify procedures 
     and methods for calculating energy and cost savings.
       ``(2) Form.--Any certification described in subsection (c) 
     shall be made in writing in a manner which specifies in 
     readily verifiable fashion the energy efficient building 
     envelope components and energy efficient heating or cooling 
     equipment installed and their respective rated energy 
     efficiency performance.
       ``(e) Basis Adjustment.--For purposes of this subtitle, if 
     a credit is allowed under this section in connection with any 
     expenditure for any property, the increase in the basis of 
     such property which would (but for this subsection) result 
     from such expenditure shall be reduced by the amount of the 
     credit so determined.
       ``(f) Coordination With Investment Credit.--For purposes of 
     this section, expenditures taken into account under section 
     47 or 48(a) shall not be taken into account under this 
     section.
       ``(g) Termination.--This section shall not apply to any 
     qualified new energy efficient home acquired after December 
     31, 2007.''.
       (b) Credit Made Part of General Business Credit.--Section 
     38(b) (relating to current year business credit), as amended 
     by this Act, is amended by striking ``plus'' at the end of 
     paragraph (21), by striking the period at the end of 
     paragraph (22) and inserting ``, plus'', and by adding at the 
     end the following new paragraph:
       ``(23) the new energy efficient home credit determined 
     under section 45L(a).''.
       (c) Basis Adjustment.--Subsection (a) of section 1016, as 
     amended by this Act, is amended by striking ``and'' at the 
     end of paragraph (31), by striking the period at the end of 
     paragraph (32) and inserting ``, and'', and by adding at the 
     end the following new paragraph:
       ``(33) to the extent provided in section 45L(e), in the 
     case of amounts with respect to which a credit has been 
     allowed under section 45L.''.
       (d) Deduction for Certain Unused Business Credits.--Section 
     196(c) (defining qualified business credits) is amended by 
     striking ``and'' at the end of paragraph (11), by striking 
     the period at the end of paragraph (12) and inserting ``, 
     and'', and by adding after paragraph (12) the following new 
     paragraph:
       ``(13) the new energy efficient home credit determined 
     under section 45L(a).''.
       (e) Clerical Amendment.--The table of sections for subpart 
     D of part IV of subchapter A of chapter 1, as amended by this 
     Act, is amended by adding at the end the following new item:

``Sec. 45L. New energy efficient home credit.''.
       (f) Effective Date.--The amendments made by this section 
     shall apply to qualified new energy efficient homes acquired 
     after December 31, 2005, in taxable years ending after such 
     date.

     SEC. 1333. CREDIT FOR CERTAIN NONBUSINESS ENERGY PROPERTY.

       (a) In General.--Subpart A of part IV of subchapter A of 
     chapter 1 (relating to nonrefundable personal credits) is 
     amended by inserting after section 25B the following new 
     section:

     ``SEC. 25C. NONBUSINESS ENERGY PROPERTY.

       ``(a) Allowance of Credit.--In the case of an individual, 
     there shall be allowed as a credit against the tax imposed by 
     this chapter for the taxable year an amount equal to the sum 
     of--
       ``(1) 10 percent of the amount paid or incurred by the 
     taxpayer for qualified energy efficiency improvements 
     installed during such taxable year, and
       ``(2) the amount of the residential energy property 
     expenditures paid or incurred by the taxpayer during such 
     taxable year.
       ``(b) Limitations.--
       ``(1) Lifetime limitation.--The credit allowed under this 
     section with respect to any taxpayer for any taxable year 
     shall not exceed the excess (if any) of $500 over the 
     aggregate credits allowed under this section with respect to 
     such taxpayer for all prior taxable years.
       ``(2) Windows.--In the case of amounts paid or incurred for 
     components described in subsection (c)(3)(B) by any taxpayer 
     for any taxable year, the credit allowed under this section 
     with respect to such amounts for such year shall not exceed 
     the excess (if any) of $200 over the aggregate credits 
     allowed under this section with respect to such amounts for 
     all prior taxable years.
       ``(3) Limitation on residential energy property 
     expenditures.--The amount of the credit allowed under this 
     section by reason of subsection (a)(2) shall not exceed--
       ``(A) $50 for any advanced main air circulating fan,
       ``(B) $150 for any qualified natural gas, propane, or oil 
     furnace or hot water boiler, and
       ``(C) $300 for any item of energy-efficient building 
     property.
       ``(c) Qualified Energy Efficiency Improvements.--For 
     purposes of this section--
       ``(1) In general.--The term `qualified energy efficiency 
     improvements' means any energy efficient building envelope 
     component which meets the prescriptive criteria for such 
     component established by the 2000 International Energy 
     Conservation Code, as such Code (including supplements) is in 
     effect on the date of the enactment of this section (or, in 
     the case of a metal roof with appropriate pigmented coatings 
     which meet the Energy Star program requirements), if--
       ``(A) such component is installed in or on a dwelling unit 
     located in the United States and owned and used by the 
     taxpayer as the taxpayer's principal residence (within the 
     meaning of section 121),
       ``(B) the original use of such component commences with the 
     taxpayer, and
       ``(C) such component reasonably can be expected to remain 
     in use for at least 5 years.
       ``(2) Building envelope component.--The term `building 
     envelope component' means--
       ``(A) any insulation material or system which is 
     specifically and primarily designed to reduce the heat loss 
     or gain of a dwelling unit when installed in or on such 
     dwelling unit,
       ``(B) exterior windows (including skylights),
       ``(C) exterior doors, and
       ``(D) any metal roof installed on a dwelling unit, but only 
     if such roof has appropriate pigmented coatings which are 
     specifically and primarily designed to reduce the heat gain 
     of such dwelling unit.

[[Page 17912]]

       ``(3) Manufactured homes included.--The term `dwelling 
     unit' includes a manufactured home which conforms to Federal 
     Manufactured Home Construction and Safety Standards (section 
     3280 of title 24, Code of Federal Regulations).
       ``(d) Residential Energy Property Expenditures.--For 
     purposes of this section--
       ``(1) In general.--The term `residential energy property 
     expenditures' means expenditures made by the taxpayer for 
     qualified energy property which is--
       ``(A) installed on or in connection with a dwelling unit 
     located in the United States and owned and used by the 
     taxpayer as the taxpayer's principal residence (within the 
     meaning of section 121), and
       ``(B) originally placed in service by the taxpayer.
     Such term includes expenditures for labor costs properly 
     allocable to the onsite preparation, assembly, or original 
     installation of the property.
       ``(2) Qualified energy property.--
       ``(A) In general.--The term `qualified energy property' 
     means--
       ``(i) energy-efficient building property,
       ``(ii) a qualified natural gas, propane, or oil furnace or 
     hot water boiler, or
       ``(iii) an advanced main air circulating fan.
       ``(B) Performance and quality standards.--Property 
     described under subparagraph (A) shall meet the performance 
     and quality standards, and the certification requirements (if 
     any), which--
       ``(i) have been prescribed by the Secretary by regulations 
     (after consultation with the Secretary of Energy or the 
     Administrator of the Environmental Protection Agency, as 
     appropriate), and
       ``(ii) are in effect at the time of the acquisition of the 
     property, or at the time of the completion of the 
     construction, reconstruction, or erection of the property, as 
     the case may be.
       ``(C) Requirements for standards.--The standards and 
     requirements prescribed by the Secretary under subparagraph 
     (B)--
       ``(i) in the case of the energy efficiency ratio (EER) for 
     central air conditioners and electric heat pumps--

       ``(I) shall require measurements to be based on published 
     data which is tested by manufacturers at 95 degrees 
     Fahrenheit, and
       ``(II) may be based on the certified data of the Air 
     Conditioning and Refrigeration Institute that are prepared in 
     partnership with the Consortium for Energy Efficiency, and

       ``(ii) in the case of geothermal heat pumps--

       ``(I) shall be based on testing under the conditions of 
     ARI/ISO Standard 13256-1 for Water Source Heat Pumps or ARI 
     870 for Direct Expansion GeoExchange Heat Pumps (DX), as 
     appropriate, and
       ``(II) shall include evidence that water heating services 
     have been provided through a desuperheater or integrated 
     water heating system connected to the storage water heater 
     tank.

       ``(3) Energy-efficient building property.--The term 
     `energy-efficient building property' means--
       ``(A) an electric heat pump water heater which yields an 
     energy factor of at least 2.0 in the standard Department of 
     Energy test procedure,
       ``(B) an electric heat pump which has a heating seasonal 
     performance factor (HSPF) of at least 9, a seasonal energy 
     efficiency ratio (SEER) of at least 15, and an energy 
     efficiency ratio (EER) of at least 13,
       ``(C) a geothermal heat pump which--
       ``(i) in the case of a closed loop product, has an energy 
     efficiency ratio (EER) of at least 14.1 and a heating 
     coefficient of performance (COP) of at least 3.3,
       ``(ii) in the case of an open loop product, has an energy 
     efficiency ratio (EER) of at least 16.2 and a heating 
     coefficient of performance (COP) of at least 3.6, and
       ``(iii) in the case of a direct expansion (DX) product, has 
     an energy efficiency ratio (EER) of at least 15 and a heating 
     coefficient of performance (COP) of at least 3.5,
       ``(D) a central air conditioner which achieves the highest 
     efficiency tier established by the Consortium for Energy 
     Efficiency, as in effect on January 1, 2006, and
       ``(E) a natural gas, propane, or oil water heater which has 
     an energy factor of at least 0.80.
       ``(4) Qualified natural gas, propane, or oil furnace or hot 
     water boiler.--The term `qualified natural gas, propane, or 
     oil furnace or hot water boiler' means a natural gas, 
     propane, or oil furnace or hot water boiler which achieves an 
     annual fuel utilization efficiency rate of not less than 95.
       ``(5) Advanced main air circulating fan.--The term 
     `advanced main air circulating fan' means a fan used in a 
     natural gas, propane, or oil furnace and which has an annual 
     electricity use of no more than 2 percent of the total annual 
     energy use of the furnace (as determined in the standard 
     Department of Energy test procedures).
       ``(e) Special Rules.--For purposes of this section--
       ``(1) Application of rules.--Rules similar to the rules 
     under paragraphs (4), (5), (6), (7), (8), and (9) of section 
     25D(e) shall apply.
       ``(2) Joint ownership of energy items.--
       ``(A) In general.--Any expenditure otherwise qualifying as 
     an expenditure under this section shall not be treated as 
     failing to so qualify merely because such expenditure was 
     made with respect to 2 or more dwelling units.
       ``(B) Limits applied separately.--In the case of any 
     expenditure described in subparagraph (A), the amount of the 
     credit allowable under subsection (a) shall (subject to 
     paragraph (1)) be computed separately with respect to the 
     amount of the expenditure made for each dwelling unit.
       ``(f) Basis Adjustments.--For purposes of this subtitle, if 
     a credit is allowed under this section for any expenditure 
     with respect to any property, the increase in the basis of 
     such property which would (but for this subsection) result 
     from such expenditure shall be reduced by the amount of the 
     credit so allowed.
       ``(g) Termination.--This section shall not apply with 
     respect to any property placed in service after December 31, 
     2007.''.
       (b) Conforming Amendments.--
       (1) Subsection (a) of section 1016, as amended by this Act, 
     is amended by striking ``and'' at the end of paragraph (32), 
     by striking the period at the end of paragraph (33) and 
     inserting ``, and'', and by adding at the end the following 
     new paragraph:
       ``(34) to the extent provided in section 25C(e), in the 
     case of amounts with respect to which a credit has been 
     allowed under section 25C.''.
       (2) The table of sections for subpart A of part IV of 
     subchapter A of chapter 1 is amended by inserting after the 
     item relating to section 25B the following new item:

``Sec. 25C. Nonbusiness energy property.''.
       (c) Effective Dates.--The amendments made by this section 
     shall apply to property placed in service after December 31, 
     2005.

     SEC. 1334. CREDIT FOR ENERGY EFFICIENT APPLIANCES.

       (a) In General.--Subpart D of part IV of subchapter A of 
     chapter 1 (relating to business-related credits), as amended 
     by this Act, is amended by adding at the end the following 
     new section:

     ``SEC. 45M. ENERGY EFFICIENT APPLIANCE CREDIT.

       ``(a) General Rule.--
       ``(1) In general.--For purposes of section 38, the energy 
     efficient appliance credit determined under this section for 
     any taxable year is an amount equal to the sum of the credit 
     amounts determined under paragraph (2) for each type of 
     qualified energy efficient appliance produced by the taxpayer 
     during the calendar year ending with or within the taxable 
     year.
       ``(2) Credit amounts.--The credit amount determined for any 
     type of qualified energy efficient appliance is--
       ``(A) the applicable amount determined under subsection (b) 
     with respect to such type, multiplied by
       ``(B) the eligible production for such type.
       ``(b) Applicable Amount.--
       ``(1) In general.--For purposes of subsection (a)--
       ``(A) Dishwashers.--The applicable amount is the energy 
     savings amount in the case of a dishwasher which--
       ``(i) is manufactured in calendar year 2006 or 2007, and
       ``(ii) meets the requirements of the Energy Star program 
     which are in effect for dishwashers in 2007.
       ``(B) Clothes washers.--The applicable amount is $100 in 
     the case of a clothes washer which--
       ``(i) is manufactured in calendar year 2006 or 2007, and
       ``(ii) meets the requirements of the Energy Star program 
     which are in effect for clothes washers in 2007.
       ``(C) Refrigerators.--
       ``(i) 15 percent savings.--The applicable amount is $75 in 
     the case of a refrigerator which--

       ``(I) is manufactured in calendar year 2006, and
       ``(II) consumes at least 15 percent but not more than 20 
     percent less kilowatt hours per year than the 2001 energy 
     conservation standards.

       ``(ii) 20 percent savings.--The applicable amount is $125 
     in the case of a refrigerator which--

       ``(I) is manufactured in calendar year 2006 or 2007, and
       ``(II) consumes at least 20 percent but not more than 25 
     percent less kilowatt hours per year than the 2001 energy 
     conservation standards.

       ``(iii) 25 percent savings.--The applicable amount is $175 
     in the case of a refrigerator which--

       ``(I) is manufactured in calendar year 2006 or 2007, and
       ``(II) consumes at least 25 percent less kilowatt hours per 
     year than the 2001 energy conservation standards.

       ``(2) Energy savings amount.--For purposes of paragraph 
     (1)(A)--
       ``(A) In general.--The energy savings amount is the lesser 
     of--
       ``(i) the product of--

       ``(I) $3, and
       ``(II) 100 multiplied by the energy savings percentage, or

       ``(ii) $100.
       ``(B) Energy savings percentage.--For purposes of 
     subparagraph (A), the energy savings percentage is the ratio 
     of--
       ``(i) the EF required by the Energy Star program for 
     dishwashers in 2007 minus the EF required by the Energy Star 
     program for dishwashers in 2005, to
       ``(ii) the EF required by the Energy Star program for 
     dishwashers in 2007.
       ``(c) Eligible Production.--
       ``(1) In general.--Except as provided in paragraphs (2), 
     the eligible production in a calendar year with respect to 
     each type of energy efficient appliance is the excess of--

[[Page 17913]]

       ``(A) the number of appliances of such type which are 
     produced by the taxpayer in the United States during such 
     calendar year, over
       ``(B) the average number of appliances of such type which 
     were produced by the taxpayer (or any predecessor) in the 
     United States during the preceding 3-calendar year period.
       ``(2) Special rule for refrigerators.--The eligible 
     production in a calendar year with respect to each type of 
     refrigerator described in subsection (b)(1)(C) is the excess 
     of--
       ``(A) the number of appliances of such type which are 
     produced by the taxpayer in the United States during such 
     calendar year, over
       ``(B) 110 percent of the average number of appliances of 
     such type which were produced by the taxpayer (or any 
     predecessor) in the United States during the preceding 3-
     calendar year period.
       ``(d) Types of Energy Efficient Appliance.--For purposes of 
     this section, the types of energy efficient appliances are--
       ``(1) dishwashers described in subsection (b)(1)(A),
       ``(2) clothes washers described in subsection (b)(1)(B),
       ``(3) refrigerators described in subsection (b)(1)(C)(i),
       ``(4) refrigerators described in subsection (b)(1)(C)(ii), 
     and
       ``(5) refrigerators described in subsection (b)(1)(C)(iii).
       ``(e) Limitations.--
       ``(1) Aggregate credit amount allowed.--The aggregate 
     amount of credit allowed under subsection (a) with respect to 
     a taxpayer for any taxable year shall not exceed $75,000,000 
     reduced by the amount of the credit allowed under subsection 
     (a) to the taxpayer (or any predecessor) for all prior 
     taxable years.
       ``(2) Amount allowed for 15 percent savings 
     refrigerators.--In the case of refrigerators described in 
     subsection (b)(1)(C)(i), the aggregate amount of the credit 
     allowed under subsection (a) with respect to a taxpayer for 
     any taxable year shall not exceed $20,000,000.
       ``(3) Limitation based on gross receipts.--The credit 
     allowed under subsection (a) with respect to a taxpayer for 
     the taxable year shall not exceed an amount equal to 2 
     percent of the average annual gross receipts of the taxpayer 
     for the 3 taxable years preceding the taxable year in which 
     the credit is determined.
       ``(4) Gross receipts.--For purposes of this subsection, the 
     rules of paragraphs (2) and (3) of section 448(c) shall 
     apply.
       ``(f) Definitions.--For purposes of this section--
       ``(1) Qualified energy efficient appliance.--The term 
     `qualified energy efficient appliance' means--
       ``(A) any dishwasher described in subsection (b)(1)(A),
       ``(B) any clothes washer described in subsection (b)(1)(B), 
     and
       ``(C) any refrigerator described in subsection (b)(1)(C).
       ``(2) Dishwasher.--The term `dishwasher' means a 
     residential dishwasher subject to the energy conservation 
     standards established by the Department of Energy.
       ``(3) Clothes washer.--The term `clothes washer' means a 
     residential model clothes washer, including a residential 
     style coin operated washer.
       ``(4) Refrigerator.--The term `refrigerator' means a 
     residential model automatic defrost refrigerator-freezer 
     which has an internal volume of at least 16.5 cubic feet.
       ``(5) EF.--The term `EF' means the energy factor 
     established by the Department of Energy for compliance with 
     the Federal energy conservation standards.
       ``(6) Produced.--The term `produced' includes manufactured.
       ``(7) 2001 energy conservation standard.--The term `2001 
     energy conservation standard' means the energy conservation 
     standards promulgated by the Department of Energy and 
     effective July 1, 2001.
       ``(g) Special Rules.--For purposes of this section--
       ``(1) In general.--Rules similar to the rules of 
     subsections (c), (d), and (e) of section 52 shall apply.
       ``(2) Controlled group.--
       ``(A) In general.--All persons treated as a single employer 
     under subsection (a) or (b) of section 52 or subsection (m) 
     or (o) of section 414 shall be treated as a single producer.
       ``(B) Inclusion of foreign corporations.--For purposes of 
     subparagraph (A), in applying subsections (a) and (b) of 
     section 52 to this section, section 1563 shall be applied 
     without regard to subsection (b)(2)(C) thereof.
       ``(3) Verification.--No amount shall be allowed as a credit 
     under subsection (a) with respect to which the taxpayer has 
     not submitted such information or certification as the 
     Secretary, in consultation with the Secretary of Energy, 
     determines necessary.''.
       (b) Conforming Amendment.--Section 38(b) (relating to 
     general business credit), as amended by this Act, is amended 
     by striking ``plus'' at the end of paragraph (22), by 
     striking the period at the end of paragraph (23) and 
     inserting ``, plus'', and by adding at the end the following 
     new paragraph:
       ``(24) the energy efficient appliance credit determined 
     under section 45M(a).''.
       (c) Clerical Amendment.--The table of sections for subpart 
     D of part IV of subchapter A of chapter 1, as amended by this 
     Act, is amended by adding at the end the following new item:

``Sec. 45M. Energy efficient appliance credit.''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to appliances produced after December 31, 2005.

     SEC. 1335. CREDIT FOR RESIDENTIAL ENERGY EFFICIENT PROPERTY.

       (a) In General.--Subpart A of part IV of subchapter A of 
     chapter 1 (relating to nonrefundable personal credits), as 
     amended by this Act, is amended by inserting after section 
     25C the following new section:

     ``SEC. 25D. RESIDENTIAL ENERGY EFFICIENT PROPERTY.

       ``(a) Allowance of Credit.--In the case of an individual, 
     there shall be allowed as a credit against the tax imposed by 
     this chapter for the taxable year an amount equal to the sum 
     of--
       ``(1) 30 percent of the qualified photovoltaic property 
     expenditures made by the taxpayer during such year,
       ``(2) 30 percent of the qualified solar water heating 
     property expenditures made by the taxpayer during such year, 
     and
       ``(3) 30 percent of the qualified fuel cell property 
     expenditures made by the taxpayer during such year.
       ``(b) Limitations.--
       ``(1) Maximum credit.--The credit allowed under subsection 
     (a) for any taxable year shall not exceed--
       ``(A) $2,000 with respect to any qualified photovoltaic 
     property expenditures,
       ``(B) $2,000 with respect to any qualified solar water 
     heating property expenditures, and
       ``(C) $500 with respect to each half kilowatt of capacity 
     of qualified fuel cell property (as defined in section 
     48(c)(1)) for which qualified fuel cell property expenditures 
     are made.
       ``(2) Certification of solar water heating property.--No 
     credit shall be allowed under this section for an item of 
     property described in subsection (d)(1) unless such property 
     is certified for performance by the non-profit Solar Rating 
     Certification Corporation or a comparable entity endorsed by 
     the government of the State in which such property is 
     installed.
       ``(c) Carryforward of Unused Credit.--If the credit 
     allowable under subsection (a) exceeds the limitation imposed 
     by section 26(a) for such taxable year reduced by the sum of 
     the credits allowable under this subpart (other than this 
     section), such excess shall be carried to the succeeding 
     taxable year and added to the credit allowable under 
     subsection (a) for such succeeding taxable year.
       ``(d) Definitions.--For purposes of this section--
       ``(1) Qualified solar water heating property expenditure.--
     The term `qualified solar water heating property expenditure' 
     means an expenditure for property to heat water for use in a 
     dwelling unit located in the United States and used as a 
     residence by the taxpayer if at least half of the energy used 
     by such property for such purpose is derived from the sun.
       ``(2) Qualified photovoltaic property expenditure.--The 
     term `qualified photovoltaic property expenditure' means an 
     expenditure for property which uses solar energy to generate 
     electricity for use in a dwelling unit located in the United 
     States and used as a residence by the taxpayer.
       ``(3) Qualified fuel cell property expenditure.--The term 
     `qualified fuel cell property expenditure' means an 
     expenditure for qualified fuel cell property (as defined in 
     section 48(c)(1)) installed on or in connection with a 
     dwelling unit located in the United States and used as a 
     principal residence (within the meaning of section 121) by 
     the taxpayer.
       ``(e) Special Rules.--For purposes of this section--
       ``(1) Labor costs.--Expenditures for labor costs properly 
     allocable to the onsite preparation, assembly, or original 
     installation of the property described in subsection (d) and 
     for piping or wiring to interconnect such property to the 
     dwelling unit shall be taken into account for purposes of 
     this section.
       ``(2) Solar panels.--No expenditure relating to a solar 
     panel or other property installed as a roof (or portion 
     thereof) shall fail to be treated as property described in 
     paragraph (1) or (2) of subsection (d) solely because it 
     constitutes a structural component of the structure on which 
     it is installed.
       ``(3) Swimming pools, etc., used as storage medium.--
     Expenditures which are properly allocable to a swimming pool, 
     hot tub, or any other energy storage medium which has a 
     function other than the function of such storage shall not be 
     taken into account for purposes of this section.
       ``(4) Dollar amounts in case of joint occupancy.--In the 
     case of any dwelling unit which is jointly occupied and used 
     during any calendar year as a residence by 2 or more 
     individuals the following rules shall apply:
       ``(A) The amount of the credit allowable, under subsection 
     (a) by reason of expenditures (as the case may be) made 
     during such calendar year by any of such individuals with 
     respect to such dwelling unit shall be determined by treating 
     all of such individuals as 1 taxpayer whose taxable year is 
     such calendar year.
       ``(B) There shall be allowable, with respect to such 
     expenditures to each of such individuals, a credit under 
     subsection (a) for the taxable year in which such calendar 
     year ends in an amount which bears the same ratio to the 
     amount determined under subparagraph (A) as the amount of 
     such expenditures made by such individual during such 
     calendar year bears to the aggregate of such expenditures 
     made by all of such individuals during such calendar year.
       ``(C) Subparagraphs (A) and (B) shall be applied separately 
     with respect to expenditures described in paragraphs (1), 
     (2), and (3) of subsection (d).

[[Page 17914]]

       ``(5) Tenant-stockholder in cooperative housing 
     corporation.--In the case of an individual who is a tenant-
     stockholder (as defined in section 216) in a cooperative 
     housing corporation (as defined in such section), such 
     individual shall be treated as having made his tenant-
     stockholder's proportionate share (as defined in section 
     216(b)(3)) of any expenditures of such corporation.
       ``(6) Condominiums.--
       ``(A) In general.--In the case of an individual who is a 
     member of a condominium management association with respect 
     to a condominium which the individual owns, such individual 
     shall be treated as having made the individual's 
     proportionate share of any expenditures of such association.
       ``(B) Condominium management association.--For purposes of 
     this paragraph, the term `condominium management association' 
     means an organization which meets the requirements of 
     paragraph (1) of section 528(c) (other than subparagraph (E) 
     thereof) with respect to a condominium project substantially 
     all of the units of which are used as residences.
       ``(7) Allocation in certain cases.--If less than 80 percent 
     of the use of an item is for nonbusiness purposes, only that 
     portion of the expenditures for such item which is properly 
     allocable to use for nonbusiness purposes shall be taken into 
     account.
       ``(8) When expenditure made; amount of expenditure.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     an expenditure with respect to an item shall be treated as 
     made when the original installation of the item is completed.
       ``(B) Expenditures part of building construction.--In the 
     case of an expenditure in connection with the construction or 
     reconstruction of a structure, such expenditure shall be 
     treated as made when the original use of the constructed or 
     reconstructed structure by the taxpayer begins.
       ``(9) Property financed by subsidized energy financing.--
     For purposes of determining the amount of expenditures made 
     by any individual with respect to any dwelling unit, there 
     shall not be taken into account expenditures which are made 
     from subsidized energy financing (as defined in section 
     48(a)(4)(C)).
       ``(f) Basis Adjustments.--For purposes of this subtitle, if 
     a credit is allowed under this section for any expenditure 
     with respect to any property, the increase in the basis of 
     such property which would (but for this subsection) result 
     from such expenditure shall be reduced by the amount of the 
     credit so allowed.
       ``(g) Termination.--The credit allowed under this section 
     shall not apply to property placed in service after December 
     31, 2007.''.
       (b) Conforming Amendments.--
       (1) Section 23(c) is amended by striking ``this section and 
     section 1400C'' and inserting ``this section, section 25D, 
     and section 1400C''.
       (2) Section 25(e)(1)(C) is amended by striking ``this 
     section and sections 23 and 1400C'' and inserting ``other 
     than this section, section 23, section 25D, and section 
     1400C''.
       (3) Section 1400C(d) is amended by striking ``this 
     section'' and inserting ``this section and section 25D''.
       (4) Section 1016(a), as amended by this Act, is amended by 
     striking ``and'' at the end of paragraph (33), by striking 
     the period at the end of paragraph (34) and inserting ``, 
     and'', and by adding at the end the following new paragraph:
       ``(35) to the extent provided in section 25D(f), in the 
     case of amounts with respect to which a credit has been 
     allowed under section 25D.''.
       (5) The table of sections for subpart A of part IV of 
     subchapter A of chapter 1, as amended by this Act, is amended 
     by inserting after the item relating to section 25C the 
     following new item:

``Sec. 25D. Residential energy efficient property.''.
       (c) Effective Dates.--The amendments made by this section 
     shall apply to property placed in service after December 31, 
     2005, in taxable years ending after such date.

     SEC. 1336. CREDIT FOR BUSINESS INSTALLATION OF QUALIFIED FUEL 
                   CELLS AND STATIONARY MICROTURBINE POWER PLANTS.

       (a) In General.--Section 48(a)(3)(A) (defining energy 
     property) is amended by striking ``or'' at the end of clause 
     (i), by adding ``or'' at the end of clause (ii), and by 
     inserting after clause (ii) the following new clause:
       ``(iii) qualified fuel cell property or qualified 
     microturbine property,''.
       (b) Qualified Fuel Cell Property; Qualified Microturbine 
     Property.--Section 48 (relating to energy credit) is amended 
     by adding at the end the following new subsection:
       ``(c) Qualified Fuel Cell Property; Qualified Microturbine 
     Property.--For purposes of this subsection--
       ``(1) Qualified fuel cell property.--
       ``(A) In general.--The term `qualified fuel cell property' 
     means a fuel cell power plant which--
       ``(i) has a nameplate capacity of at least 0.5 kilowatt of 
     electricity using an electrochemical process, and
       ``(ii) has an electricity-only generation efficiency 
     greater than 30 percent.
       ``(B) Limitation.--In the case of qualified fuel cell 
     property placed in service during the taxable year, the 
     credit otherwise determined under paragraph (1) for such year 
     with respect to such property shall not exceed an amount 
     equal to $500 for each 0.5 kilowatt of capacity of such 
     property.
       ``(C) Fuel cell power plant.--The term `fuel cell power 
     plant' means an integrated system comprised of a fuel cell 
     stack assembly and associated balance of plant components 
     which converts a fuel into electricity using electrochemical 
     means.
       ``(D) Special rule.--The first sentence of the matter in 
     subsection (a)(3) which follows subparagraph (D) thereof 
     shall not apply to qualified fuel cell property which is used 
     predominantly in the trade or business of the furnishing or 
     sale of telephone service, telegraph service by means of 
     domestic telegraph operations, or other telegraph services 
     (other than international telegraph services).
       ``(E) Termination.--The term `qualified fuel cell property' 
     shall not include any property for any period after December 
     31, 2007.
       ``(2) Qualified microturbine property.--
       ``(A) In general.--The term `qualified microturbine 
     property' means a stationary microturbine power plant which--
       ``(i) has a nameplate capacity of less than 2,000 
     kilowatts, and
       ``(ii) has an electricity-only generation efficiency of not 
     less than 26 percent at International Standard Organization 
     conditions.
       ``(B) Limitation.--In the case of qualified microturbine 
     property placed in service during the taxable year, the 
     credit otherwise determined under paragraph (1) for such year 
     with respect to such property shall not exceed an amount 
     equal $200 for each kilowatt of capacity of such property.
       ``(C) Stationary microturbine power plant.--The term 
     `stationary microturbine power plant' means an integrated 
     system comprised of a gas turbine engine, a combustor, a 
     recuperator or regenerator, a generator or alternator, and 
     associated balance of plant components which converts a fuel 
     into electricity and thermal energy. Such term also includes 
     all secondary components located between the existing 
     infrastructure for fuel delivery and the existing 
     infrastructure for power distribution, including equipment 
     and controls for meeting relevant power standards, such as 
     voltage, frequency, and power factors.
       ``(D) Special rule.--The first sentence of the matter in 
     subsection (a)(3) which follows subparagraph (D) thereof 
     shall not apply to qualified microturbine property which is 
     used predominantly in the trade or business of the furnishing 
     or sale of telephone service, telegraph service by means of 
     domestic telegraph operations, or other telegraph services 
     (other than international telegraph services).
       ``(E) Termination.--The term `qualified microturbine 
     property' shall not include any property for any period after 
     December 31, 2007.''.
       (c) Energy Percentage.--Section 48(a)(2)(A) (relating to 
     energy percentage) is amended to read as follows:
       ``(A) In general.--The energy percentage is--
       ``(i) in the case of qualified fuel cell property, 30 
     percent, and
       ``(ii) in the case of any other energy property, 10 
     percent.''.
       (d) Conforming Amendment.--Section 48(a)(1) is amended by 
     inserting ``except as provided in paragraph (1)(B) or (2)(B) 
     of subsection (d),'' before ``the energy''.
       (e) Effective Date.--The amendments made by this section 
     shall apply to periods after December 31, 2005, in taxable 
     years ending after such date, under rules similar to the 
     rules of section 48(m) of the Internal Revenue Code of 1986 
     (as in effect on the day before the date of the enactment of 
     the Revenue Reconciliation Act of 1990).

     SEC. 1337. BUSINESS SOLAR INVESTMENT TAX CREDIT.

       (a) Increase in Energy Percentage.--Section 48(a)(2)(A) 
     (relating to energy percentage), as amended by this Act, is 
     amended to read as follows:
       ``(A) In general.--The energy percentage is--
       ``(i) 30 percent in the case of--

       ``(I) qualified fuel cell property,
       ``(II) energy property described in paragraph (3)(A)(i) but 
     only with respect to periods ending before January 1, 2008, 
     and
       ``(III) energy property described in paragraph (3)(A)(ii), 
     and

       ``(ii) in the case of any energy property to which clause 
     (i) does not apply, 10 percent.''.
       (b) Hybrid Solar Lighting Systems.--Subparagraph (A) of 
     section 48(a)(3) is amended by striking ``or'' at the end of 
     clause (i), by redesignating clause (ii) as clause (iii), and 
     by inserting after clause (i) the following new clause:
       ``(ii) equipment which uses solar energy to illuminate the 
     inside of a structure using fiber-optic distributed sunlight 
     but only with respect to periods ending before January 1, 
     2008, or''.
       (c) Limitation on Use of Solar Energy to Heat Swimming 
     Pools.--Clause (i) of section 48(a)(3)(A) is amended by 
     inserting ``excepting property used to generate energy for 
     the purposes of heating a swimming pool,'' after ``solar 
     process heat,''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to periods after December 31, 2005, in taxable 
     years ending after such date, under rules similar to the 
     rules of section 48(m) of the Internal Revenue Code of 1986 
     (as in effect on the day before the date of the enactment of 
     the Revenue Reconciliation Act of 1990).
      Subtitle D--Alternative Motor Vehicles and Fuels Incentives

     SEC. 1341. ALTERNATIVE MOTOR VEHICLE CREDIT.

       (a) In General.--Subpart B of part IV of subchapter A of 
     chapter 1 (relating to foreign tax credit, etc.) is amended 
     by adding at the end the following new section:

[[Page 17915]]



     ``SEC. 30B. ALTERNATIVE MOTOR VEHICLE CREDIT.

       ``(a) Allowance of Credit.--There shall be allowed as a 
     credit against the tax imposed by this chapter for the 
     taxable year an amount equal to the sum of--
       ``(1) the new qualified fuel cell motor vehicle credit 
     determined under subsection (b),
       ``(2) the new advanced lean burn technology motor vehicle 
     credit determined under subsection (c),
       ``(3) the new qualified hybrid motor vehicle credit 
     determined under subsection (d), and
       ``(4) the new qualified alternative fuel motor vehicle 
     credit determined under subsection (e).
       ``(b) New Qualified Fuel Cell Motor Vehicle Credit.--
       ``(1) In general.--For purposes of subsection (a), the new 
     qualified fuel cell motor vehicle credit determined under 
     this subsection with respect to a new qualified fuel cell 
     motor vehicle placed in service by the taxpayer during the 
     taxable year is--
       ``(A) $8,000 ($4,000 in the case of a vehicle placed in 
     service after December 31, 2009), if such vehicle has a gross 
     vehicle weight rating of not more than 8,500 pounds,
       ``(B) $10,000, if such vehicle has a gross vehicle weight 
     rating of more than 8,500 pounds but not more than 14,000 
     pounds,
       ``(C) $20,000, if such vehicle has a gross vehicle weight 
     rating of more than 14,000 pounds but not more than 26,000 
     pounds, and
       ``(D) $40,000, if such vehicle has a gross vehicle weight 
     rating of more than 26,000 pounds.
       ``(2) Increase for fuel efficiency.--
       ``(A) In general.--The amount determined under paragraph 
     (1)(A) with respect to a new qualified fuel cell motor 
     vehicle which is a passenger automobile or light truck shall 
     be increased by--
       ``(i) $1,000, if such vehicle achieves at least 150 percent 
     but less than 175 percent of the 2002 model year city fuel 
     economy,
       ``(ii) $1,500, if such vehicle achieves at least 175 
     percent but less than 200 percent of the 2002 model year city 
     fuel economy,
       ``(iii) $2,000, if such vehicle achieves at least 200 
     percent but less than 225 percent of the 2002 model year city 
     fuel economy,
       ``(iv) $2,500, if such vehicle achieves at least 225 
     percent but less than 250 percent of the 2002 model year city 
     fuel economy,
       ``(v) $3,000, if such vehicle achieves at least 250 percent 
     but less than 275 percent of the 2002 model year city fuel 
     economy,
       ``(vi) $3,500, if such vehicle achieves at least 275 
     percent but less than 300 percent of the 2002 model year city 
     fuel economy, and
       ``(vii) $4,000, if such vehicle achieves at least 300 
     percent of the 2002 model year city fuel economy.
       ``(B) 2002 model year city fuel economy.--For purposes of 
     subparagraph (A), the 2002 model year city fuel economy with 
     respect to a vehicle shall be determined in accordance with 
     the following tables:
       ``(i) In the case of a passenger automobile:
  If vehicle inertia weight class is:          The 2002 model year city
                                                       fuel economy is:
1,500 or 1,750 lbs...........................................45.2 mpg  
2,000 lbs....................................................39.6 mpg  
2,250 lbs....................................................35.2 mpg  
2,500 lbs....................................................31.7 mpg  
2,750 lbs....................................................28.8 mpg  
3,000 lbs....................................................26.4 mpg  
3,500 lbs....................................................22.6 mpg  
4,000 lbs....................................................19.8 mpg  
4,500 lbs....................................................17.6 mpg  
5,000 lbs....................................................15.9 mpg  
5,500 lbs....................................................14.4 mpg  
6,000 lbs....................................................13.2 mpg  
6,500 lbs....................................................12.2 mpg  
7,000 to 8,500 lbs............................................11.3 mpg.
       ``(ii) In the case of a light truck:
  If vehicle inertia weight class is:          The 2002 model year city
                                                       fuel economy is:
1,500 or 1,750 lbs...........................................39.4 mpg  
2,000 lbs....................................................35.2 mpg  
2,250 lbs....................................................31.8 mpg  
2,500 lbs....................................................29.0 mpg  
2,750 lbs....................................................26.8 mpg  
3,000 lbs....................................................24.9 mpg  
3,500 lbs....................................................21.8 mpg  
4,000 lbs....................................................19.4 mpg  
4,500 lbs....................................................17.6 mpg  
5,000 lbs....................................................16.1 mpg  
5,500 lbs....................................................14.8 mpg  
6,000 lbs....................................................13.7 mpg  
6,500 lbs....................................................12.8 mpg  
7,000 to 8,500 lbs............................................12.1 mpg.
       ``(C) Vehicle inertia weight class.--For purposes of 
     subparagraph (B), the term `vehicle inertia weight class' has 
     the same meaning as when defined in regulations prescribed by 
     the Administrator of the Environmental Protection Agency for 
     purposes of the administration of title II of the Clean Air 
     Act (42 U.S.C. 7521 et seq.).
       ``(3) New qualified fuel cell motor vehicle.--For purposes 
     of this subsection, the term `new qualified fuel cell motor 
     vehicle' means a motor vehicle--
       ``(A) which is propelled by power derived from 1 or more 
     cells which convert chemical energy directly into electricity 
     by combining oxygen with hydrogen fuel which is stored on 
     board the vehicle in any form and may or may not require 
     reformation prior to use,
       ``(B) which, in the case of a passenger automobile or light 
     truck, has received on or after the date of the enactment of 
     this section a certificate that such vehicle meets or exceeds 
     the Bin 5 Tier II emission level established in regulations 
     prescribed by the Administrator of the Environmental 
     Protection Agency under section 202(i) of the Clean Air Act 
     for that make and model year vehicle,
       ``(C) the original use of which commences with the 
     taxpayer,
       ``(D) which is acquired for use or lease by the taxpayer 
     and not for resale, and
       ``(E) which is made by a manufacturer.
       ``(c) New Advanced Lean Burn Technology Motor Vehicle 
     Credit.--
       ``(1) In general.--For purposes of subsection (a), the new 
     advanced lean burn technology motor vehicle credit determined 
     under this subsection for the taxable year is the credit 
     amount determined under paragraph (2) with respect to a new 
     advanced lean burn technology motor vehicle placed in service 
     by the taxpayer during the taxable year.
       ``(2) Credit amount.--
       ``(A) Fuel economy.--
       ``(i) In general.--The credit amount determined under this 
     paragraph shall be determined in accordance with the 
     following table:
In the case of a vehicle which achieves a fuel economy (expressed as a 
  percentage of the 2002 model year city fuel ecoThe credit amount is--
At least 125 percent but less than 150 percent.....................$400
At least 150 percent but less than 175 percent.....................$800
At least 175 percent but less than 200 percent...................$1,200
At least 200 percent but less than 225 percent...................$1,600
At least 225 percent but less than 250 percent...................$2,000
At least 250 percent............................................$2,400.
       ``(ii) 2002 model year city fuel economy.--For purposes of 
     clause (i), the 2002 model year city fuel economy with 
     respect to a vehicle shall be determined on a gasoline gallon 
     equivalent basis as determined by the Administrator of the 
     Environmental Protection Agency using the tables provided in 
     subsection (b)(2)(B) with respect to such vehicle.
       ``(B) Conservation credit.--The amount determined under 
     subparagraph (A) with respect to a new advanced lean burn 
     technology motor vehicle shall be increased by the 
     conservation credit amount determined in accordance with the 
     following table:
In the case of a vehicle which achieves a lifetime fuel savings 
  (expressed in gallons of gasoline)The conservation credit amount is--
At least 1,200 but less than 1,800.................................$250
At least 1,800 but less than 2,400.................................$500
At least 2,400 but less than 3,000.................................$750
At least 3,000..................................................$1,000.
       ``(3) New advanced lean burn technology motor vehicle.--For 
     purposes of this subsection, the term `new advanced lean burn 
     technology motor vehicle' means a passenger automobile or a 
     light truck--
       ``(A) with an internal combustion engine which--
       ``(i) is designed to operate primarily using more air than 
     is necessary for complete combustion of the fuel,
       ``(ii) incorporates direct injection,
       ``(iii) achieves at least 125 percent of the 2002 model 
     year city fuel economy,
       ``(iv) for 2004 and later model vehicles, has received a 
     certificate that such vehicle meets or exceeds--

       ``(I) in the case of a vehicle having a gross vehicle 
     weight rating of 6,000 pounds or less, the Bin 5 Tier II 
     emission standard established in regulations prescribed by 
     the Administrator of the Environmental Protection Agency 
     under section 202(i) of the Clean Air Act for that make and 
     model year vehicle, and
       ``(II) in the case of a vehicle having a gross vehicle 
     weight rating of more than 6,000 pounds but not more than 
     8,500 pounds, the Bin 8 Tier II emission standard which is so 
     established.

       ``(B) the original use of which commences with the 
     taxpayer,
       ``(C) which is acquired for use or lease by the taxpayer 
     and not for resale, and
       ``(D) which is made by a manufacturer.
       ``(4) Lifetime fuel savings.--For purposes of this 
     subsection, the term `lifetime fuel savings' means, in the 
     case of any new advanced lean burn technology motor vehicle, 
     an amount equal to the excess (if any) of--
       ``(A) 120,000 divided by the 2002 model year city fuel 
     economy for the vehicle inertia weight class, over
       ``(B) 120,000 divided by the city fuel economy for such 
     vehicle.
       ``(d) New Qualified Hybrid Motor Vehicle Credit.--
       ``(1) In general.--For purposes of subsection (a), the new 
     qualified hybrid motor vehicle credit determined under this 
     subsection for the taxable year is the credit amount 
     determined under paragraph (2) with respect to a new 
     qualified hybrid motor vehicle placed in service by the 
     taxpayer during the taxable year.
       ``(2) Credit amount.--
       ``(A) Credit amount for passenger automobiles and light 
     trucks.--In the case of a new qualified hybrid motor vehicle 
     which is a passenger automobile or light truck and which has 
     a gross vehicle weight rating of not more than 8,500 pounds, 
     the amount determined under this paragraph is the sum of the 
     amounts determined under clauses (i) and (ii).
       ``(i) Fuel economy.--The amount determined under this 
     clause is the amount which would be

[[Page 17916]]

     determined under subsection (c)(2)(A) if such vehicle were a 
     vehicle referred to in such subsection.
       ``(ii) Conservation credit.--The amount determined under 
     this clause is the amount which would be determined under 
     subsection (c)(2)(B) if such vehicle were a vehicle referred 
     to in such subsection.
       ``(B) Credit amount for other motor vehicles.--
       ``(i) In general.--In the case of any new qualified hybrid 
     motor vehicle to which subparagraph (A) does not apply, the 
     amount determined under this paragraph is the amount equal to 
     the applicable percentage of the qualified incremental hybrid 
     cost of the vehicle as certified under clause (v).
       ``(ii) Applicable percentage.--For purposes of clause (i), 
     the applicable percentage is--

       ``(I) 20 percent if the vehicle achieves an increase in 
     city fuel economy relative to a comparable vehicle of at 
     least 30 percent but less than 40 percent,
       ``(II) 30 percent if the vehicle achieves such an increase 
     of at least 40 percent but less than 50 percent, and
       ``(III) 40 percent if the vehicle achieves such an increase 
     of at least 50 percent.

       ``(iii) Qualified incremental hybrid cost.--For purposes of 
     this subparagraph, the qualified incremental hybrid cost of 
     any vehicle is equal to the amount of the excess of the 
     manufacturer's suggested retail price for such vehicle over 
     such price for a comparable vehicle, to the extent such 
     amount does not exceed--

       ``(I) $7,500, if such vehicle has a gross vehicle weight 
     rating of not more than 14,000 pounds,
       ``(II) $15,000, if such vehicle has a gross vehicle weight 
     rating of more than 14,000 pounds but not more than 26,000 
     pounds, and
       ``(III) $30,000, if such vehicle has a gross vehicle weight 
     rating of more than 26,000 pounds.

       ``(iv) Comparable vehicle.--For purposes of this 
     subparagraph, the term `comparable vehicle' means, with 
     respect to any new qualified hybrid motor vehicle, any 
     vehicle which is powered solely by a gasoline or diesel 
     internal combustion engine and which is comparable in weight, 
     size, and use to such vehicle.
       ``(v) Certification.--A certification described in clause 
     (i) shall be made by the manufacturer and shall be determined 
     in accordance with guidance prescribed by the Secretary. Such 
     guidance shall specify procedures and methods for calculating 
     fuel economy savings and incremental hybrid costs.
       ``(3) New qualified hybrid motor vehicle.--For purposes of 
     this subsection--
       ``(A) In general.--The term `new qualified hybrid motor 
     vehicle' means a motor vehicle--
       ``(i) which draws propulsion energy from onboard sources of 
     stored energy which are both--

       ``(I) an internal combustion or heat engine using 
     consumable fuel, and
       ``(II) a rechargeable energy storage system,

       ``(ii) which, in the case of a vehicle to which paragraph 
     (2)(A) applies, has received a certificate of conformity 
     under the Clean Air Act and meets or exceeds the equivalent 
     qualifying California low emission vehicle standard under 
     section 243(e)(2) of the Clean Air Act for that make and 
     model year, and

       ``(I) in the case of a vehicle having a gross vehicle 
     weight rating of 6,000 pounds or less, the Bin 5 Tier II 
     emission standard established in regulations prescribed by 
     the Administrator of the Environmental Protection Agency 
     under section 202(i) of the Clean Air Act for that make and 
     model year vehicle, and
       ``(II) in the case of a vehicle having a gross vehicle 
     weight rating of more than 6,000 pounds but not more than 
     8,500 pounds, the Bin 8 Tier II emission standard which is so 
     established,

       ``(iii) which has a maximum available power of at least--

       ``(I) 4 percent in the case of a vehicle to which paragraph 
     (2)(A) applies,
       ``(II) 10 percent in the case of a vehicle which has a 
     gross vehicle weight rating or more than 8,500 pounds and not 
     than 14,000 pounds, and
       ``(III) 15 percent in the case of a vehicle in excess of 
     14,000 pounds,

       ``(iv) which, in the case of a vehicle to which paragraph 
     (2)(B) applies, has an internal combustion or heat engine 
     which has received a certificate of conformity under the 
     Clean Air Act as meeting the emission standards set in the 
     regulations prescribed by the Administrator of the 
     Environmental Protection Agency for 2004 through 2007 model 
     year diesel heavy duty engines or ottocycle heavy duty 
     engines, as applicable,
       ``(v) the original use of which commences with the 
     taxpayer,
       ``(vi) which is acquired for use or lease by the taxpayer 
     and not for resale, and
       ``(vii) which is made by a manufacturer.
     Such term shall not include any vehicle which is not a 
     passenger automobile or light truck if such vehicle has a 
     gross vehicle weight rating of less than 8,500 pounds.
       ``(B) Consumable fuel.--For purposes of subparagraph 
     (A)(i)(I), the term `consumable fuel' means any solid, 
     liquid, or gaseous matter which releases energy when consumed 
     by an auxiliary power unit.
       ``(C) Maximum available power.--
       ``(i) Certain passenger automobiles and light trucks.--In 
     the case of a vehicle to which paragraph (2)(A) applies, the 
     term `maximum available power' means the maximum power 
     available from the rechargeable energy storage system, during 
     a standard 10 second pulse power or equivalent test, divided 
     by such maximum power and the SAE net power of the heat 
     engine.
       ``(ii) Other motor vehicles.--In the case of a vehicle to 
     which paragraph (2)(B) applies, the term `maximum available 
     power' means the maximum power available from the 
     rechargeable energy storage system, during a standard 10 
     second pulse power or equivalent test, divided by the 
     vehicle's total traction power. For purposes of the preceding 
     sentence, the term `total traction power' means the sum of 
     the peak power from the rechargeable energy storage system 
     and the heat engine peak power of the vehicle, except that if 
     such storage system is the sole means by which the vehicle 
     can be driven, the total traction power is the peak power of 
     such storage system.
       ``(e) New Qualified Alternative Fuel Motor Vehicle 
     Credit.--
       ``(1) Allowance of credit.--Except as provided in paragraph 
     (5), the new qualified alternative fuel motor vehicle credit 
     determined under this subsection is an amount equal to the 
     applicable percentage of the incremental cost of any new 
     qualified alternative fuel motor vehicle placed in service by 
     the taxpayer during the taxable year.
       ``(2) Applicable percentage.--For purposes of paragraph 
     (1), the applicable percentage with respect to any new 
     qualified alternative fuel motor vehicle is--
       ``(A) 50 percent, plus
       ``(B) 30 percent, if such vehicle--
       ``(i) has received a certificate of conformity under the 
     Clean Air Act and meets or exceeds the most stringent 
     standard available for certification under the Clean Air Act 
     for that make and model year vehicle (other than a zero 
     emission standard), or
       ``(ii) has received an order certifying the vehicle as 
     meeting the same requirements as vehicles which may be sold 
     or leased in California and meets or exceeds the most 
     stringent standard available for certification under the 
     State laws of California (enacted in accordance with a waiver 
     granted under section 209(b) of the Clean Air Act) for that 
     make and model year vehicle (other than a zero emission 
     standard).

     For purposes of the preceding sentence, in the case of any 
     new qualified alternative fuel motor vehicle which weighs 
     more than 14,000 pounds gross vehicle weight rating, the most 
     stringent standard available shall be such standard available 
     for certification on the date of the enactment of the Energy 
     Tax Incentives Act of 2005.
       ``(3) Incremental cost.--For purposes of this subsection, 
     the incremental cost of any new qualified alternative fuel 
     motor vehicle is equal to the amount of the excess of the 
     manufacturer's suggested retail price for such vehicle over 
     such price for a gasoline or diesel fuel motor vehicle of the 
     same model, to the extent such amount does not exceed--
       ``(A) $5,000, if such vehicle has a gross vehicle weight 
     rating of not more than 8,500 pounds,
       ``(B) $10,000, if such vehicle has a gross vehicle weight 
     rating of more than 8,500 pounds but not more than 14,000 
     pounds,
       ``(C) $25,000, if such vehicle has a gross vehicle weight 
     rating of more than 14,000 pounds but not more than 26,000 
     pounds, and
       ``(D) $40,000, if such vehicle has a gross vehicle weight 
     rating of more than 26,000 pounds.
       ``(4) New qualified alternative fuel motor vehicle.--For 
     purposes of this subsection--
       ``(A) In general.--The term `new qualified alternative fuel 
     motor vehicle' means any motor vehicle--
       ``(i) which is only capable of operating on an alternative 
     fuel,
       ``(ii) the original use of which commences with the 
     taxpayer,
       ``(iii) which is acquired by the taxpayer for use or lease, 
     but not for resale, and
       ``(iv) which is made by a manufacturer.
       ``(B) Alternative fuel.--The term `alternative fuel' means 
     compressed natural gas, liquefied natural gas, liquefied 
     petroleum gas, hydrogen, and any liquid at least 85 percent 
     of the volume of which consists of methanol.
       ``(5) Credit for mixed-fuel vehicles.--
       ``(A) In general.--In the case of a mixed-fuel vehicle 
     placed in service by the taxpayer during the taxable year, 
     the credit determined under this subsection is an amount 
     equal to--
       ``(i) in the case of a 75/25 mixed-fuel vehicle, 70 percent 
     of the credit which would have been allowed under this 
     subsection if such vehicle was a qualified alternative fuel 
     motor vehicle, and
       ``(ii) in the case of a 90/10 mixed-fuel vehicle, 90 
     percent of the credit which would have been allowed under 
     this subsection if such vehicle was a qualified alternative 
     fuel motor vehicle.
       ``(B) Mixed-fuel vehicle.--For purposes of this subsection, 
     the term `mixed-fuel vehicle' means any motor vehicle 
     described in subparagraph (C) or (D) of paragraph (3), 
     which--
       ``(i) is certified by the manufacturer as being able to 
     perform efficiently in normal operation on a combination of 
     an alternative fuel and a petroleum-based fuel,
       ``(ii) either--

       ``(I) has received a certificate of conformity under the 
     Clean Air Act, or
       ``(II) has received an order certifying the vehicle as 
     meeting the same requirements as vehicles which may be sold 
     or leased in California and meets or exceeds the low emission 
     vehicle standard under section 88.105-94 of title 40, Code of 
     Federal Regulations, for that make and model year vehicle,

       ``(iii) the original use of which commences with the 
     taxpayer,
       ``(iv) which is acquired by the taxpayer for use or lease, 
     but not for resale, and
       ``(v) which is made by a manufacturer.
       ``(C) 75/25 mixed-fuel vehicle.--For purposes of this 
     subsection, the term `75/25 mixed-

[[Page 17917]]

     fuel vehicle' means a mixed-fuel vehicle which operates using 
     at least 75 percent alternative fuel and not more than 25 
     percent petroleum-based fuel.
       ``(D) 90/10 mixed-fuel vehicle.--For purposes of this 
     subsection, the term `90/10 mixed-fuel vehicle' means a 
     mixed-fuel vehicle which operates using at least 90 percent 
     alternative fuel and not more than 10 percent petroleum-based 
     fuel.
       ``(f) Limitation on Number of New Qualified Hybrid and 
     Advanced Lean-Burn Technology Vehicles Eligible for Credit.--
       ``(1) In general.--In the case of a qualified vehicle sold 
     during the phaseout period, only the applicable percentage of 
     the credit otherwise allowable under subsection (c) or (d) 
     shall be allowed.
       ``(2) Phaseout period.--For purposes of this subsection, 
     the phaseout period is the period beginning with the second 
     calendar quarter following the calendar quarter which 
     includes the first date on which the number of qualified 
     vehicles manufactured by the manufacturer of the vehicle 
     referred to in paragraph (1) sold for use in the United 
     States after December 31, 2005, is at least 60,000.
       ``(3) Applicable percentage.--For purposes of paragraph 
     (1), the applicable percentage is--
       ``(A) 50 percent for the first 2 calendar quarters of the 
     phaseout period,
       ``(B) 25 percent for the 3d and 4th calendar quarters of 
     the phaseout period, and
       ``(C) 0 percent for each calendar quarter thereafter.
       ``(4) Controlled groups.--
       ``(A) In general.--For purposes of this subsection, all 
     persons treated as a single employer under subsection (a) or 
     (b) of section 52 or subsection (m) or (o) of section 414 
     shall be treated as a single manufacturer.
       ``(B) Inclusion of foreign corporations.--For purposes of 
     subparagraph (A), in applying subsections (a) and (b) of 
     section 52 to this section, section 1563 shall be applied 
     without regard to subsection (b)(2)(C) thereof.
       ``(5) Qualified vehicle.--For purposes of this subsection, 
     the term `qualified vehicle' means any new qualified hybrid 
     motor vehicle (described in subsection (d)(2)(A)) and any new 
     advanced lean burn technology motor vehicle.
       ``(g) Application With Other Credits.--
       ``(1) Business credit treated as part of general business 
     credit.--So much of the credit which would be allowed under 
     subsection (a) for any taxable year (determined without 
     regard to this subsection) that is attributable to property 
     of a character subject to an allowance for depreciation shall 
     be treated as a credit listed in section 38(b) for such 
     taxable year (and not allowed under subsection (a)).
       ``(2) Personal credit.--The credit allowed under subsection 
     (a) (after the application of paragraph (1)) for any taxable 
     year shall not exceed the excess (if any) of--
       ``(A) the regular tax reduced by the sum of the credits 
     allowable under subpart A and sections 27 and 30, over
       ``(B) the tentative minimum tax for the taxable year.
       ``(h) Other Definitions and Special Rules.--For purposes of 
     this section--
       ``(1) Motor vehicle.--The term `motor vehicle' has the 
     meaning given such term by section 30(c)(2).
       ``(2) City fuel economy.--The city fuel economy with 
     respect to any vehicle shall be measured in a manner which is 
     substantially similar to the manner city fuel economy is 
     measured in accordance with procedures under part 600 of 
     subchapter Q of chapter I of title 40, Code of Federal 
     Regulations, as in effect on the date of the enactment of 
     this section.
       ``(3) Other terms.--The terms `automobile', `passenger 
     automobile', `medium duty passenger vehicle', `light truck', 
     and `manufacturer' have the meanings given such terms in 
     regulations prescribed by the Administrator of the 
     Environmental Protection Agency for purposes of the 
     administration of title II of the Clean Air Act (42 U.S.C. 
     7521 et seq.).
       ``(4) Reduction in basis.--For purposes of this subtitle, 
     the basis of any property for which a credit is allowable 
     under subsection (a) shall be reduced by the amount of such 
     credit so allowed (determined without regard to subsection 
     (g)).
       ``(5) No double benefit.--The amount of any deduction or 
     other credit allowable under this chapter--
       ``(A) for any incremental cost taken into account in 
     computing the amount of the credit determined under 
     subsection (e) shall be reduced by the amount of such credit 
     attributable to such cost, and
       ``(B) with respect to a vehicle described under subsection 
     (b) or (c), shall be reduced by the amount of credit allowed 
     under subsection (a) for such vehicle for the taxable year.
       ``(6) Property used by tax-exempt entity.--In the case of a 
     vehicle whose use is described in paragraph (3) or (4) of 
     section 50(b) and which is not subject to a lease, the person 
     who sold such vehicle to the person or entity using such 
     vehicle shall be treated as the taxpayer that placed such 
     vehicle in service, but only if such person clearly discloses 
     to such person or entity in a document the amount of any 
     credit allowable under subsection (a) with respect to such 
     vehicle (determined without regard to subsection (g)).
       ``(7) Property used outside united states, etc., not 
     qualified.--No credit shall be allowable under subsection (a) 
     with respect to any property referred to in section 50(b)(1) 
     or with respect to the portion of the cost of any property 
     taken into account under section 179.
       ``(8) Recapture.--The Secretary shall, by regulations, 
     provide for recapturing the benefit of any credit allowable 
     under subsection (a) with respect to any property which 
     ceases to be property eligible for such credit (including 
     recapture in the case of a lease period of less than the 
     economic life of a vehicle).
       ``(9) Election to not take credit.--No credit shall be 
     allowed under subsection (a) for any vehicle if the taxpayer 
     elects to not have this section apply to such vehicle.
       ``(10) Interaction with air quality and motor vehicle 
     safety standards.--Unless otherwise provided in this section, 
     a motor vehicle shall not be considered eligible for a credit 
     under this section unless such vehicle is in compliance 
     with--
       ``(A) the applicable provisions of the Clean Air Act for 
     the applicable make and model year of the vehicle (or 
     applicable air quality provisions of State law in the case of 
     a State which has adopted such provision under a waiver under 
     section 209(b) of the Clean Air Act), and
       ``(B) the motor vehicle safety provisions of sections 30101 
     through 30169 of title 49, United States Code.
       ``(i) Regulations.--
       ``(1) In general.--Except as provided in paragraph (2), the 
     Secretary shall promulgate such regulations as necessary to 
     carry out the provisions of this section.
       ``(2) Coordination in prescription of certain 
     regulations.--The Secretary of the Treasury, in coordination 
     with the Secretary of Transportation and the Administrator of 
     the Environmental Protection Agency, shall prescribe such 
     regulations as necessary to determine whether a motor vehicle 
     meets the requirements to be eligible for a credit under this 
     section.
       ``(j) Termination.--This section shall not apply to any 
     property purchased after--
       ``(1) in the case of a new qualified fuel cell motor 
     vehicle (as described in subsection (b)), December 31, 2014,
       ``(2) in the case of a new advanced lean burn technology 
     motor vehicle (as described in subsection (c)) or a new 
     qualified hybrid motor vehicle (as described in subsection 
     (d)(2)(A)), December 31, 2010,
       ``(3) in the case of a new qualified hybrid motor vehicle 
     (as described in subsection (d)(2)(B)), December 31, 2009, 
     and
       ``(4) in the case of a new qualified alternative fuel 
     vehicle (as described in subsection (e)), December 31, 
     2010.''.
       (b) Conforming Amendments.--
       (1) Section 38(b), as amended by this Act, is amended by 
     striking ``plus'' at the end of paragraph (23), by striking 
     the period at the end of paragraph (24) and inserting ``, 
     and'', and by adding at the end the following new paragraph:
       ``(25) the portion of the alternative motor vehicle credit 
     to which section 30B(g)(1) applies.''.
       (2) Section 1016(a), as amended by this Act, is amended by 
     striking ``and'' at the end of paragraph (34), by striking 
     the period at the end of paragraph (35) and inserting ``, 
     and'', and by adding at the end the following new paragraph:
       ``(36) to the extent provided in section 30B(h)(4).''.
       (3) Section 55(c)(2), as amended by this Act, is amended by 
     inserting ``30B(g)(2),'' after ``30(b)(2),''.
       (4) Section 6501(m) is amended by inserting ``30B(h)(9),'' 
     after ``30(d)(4),''.
       (5) The table of sections for subpart B of part IV of 
     subchapter A of chapter 1 is amended by inserting after the 
     item relating to section 30A the following new item:

``Sec. 30B. Alternative motor vehicle credit.''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to property placed in service after December 31, 
     2005, in taxable years ending after such date.

     SEC. 1342. CREDIT FOR INSTALLATION OF ALTERNATIVE FUELING 
                   STATIONS.

       (a) In General.--Subpart B of part IV of subchapter A of 
     chapter 1 (relating to other credits), as amended by this 
     Act, is amended by adding at the end the following new 
     section:

     ``SEC. 30C. ALTERNATIVE FUEL VEHICLE REFUELING PROPERTY 
                   CREDIT.

       ``(a) Credit Allowed.--There shall be allowed as a credit 
     against the tax imposed by this chapter for the taxable year 
     an amount equal to 30 percent of the cost of any qualified 
     alternative fuel vehicle refueling property placed in service 
     by the taxpayer during the taxable year.
       ``(b) Limitation.--The credit allowed under subsection (a) 
     with respect to any alternative fuel vehicle refueling 
     property shall not exceed--
       ``(1) $30,000 in the case of a property of a character 
     subject to an allowance for depreciation, and
       ``(2) $1,000 in any other case.
       ``(c) Qualified Alternative Fuel Vehicle Refueling 
     Property.--
       ``(1) In general.--Except as provided in paragraph (2), the 
     term `qualified alternative fuel vehicle refueling property' 
     has the meaning given to such term by section 179A(d), but 
     only with respect to any fuel--
       ``(A) at least 85 percent of the volume of which consists 
     of 1 or more of the following: ethanol, natural gas, 
     compressed natural gas, liquefied natural gas, liquefied 
     petroleum gas, or hydrogen, or
       ``(B) any mixture of biodiesel (as defined in section 
     40A(d)(1)) and diesel fuel (as defined in section 
     4083(a)(3)), determined without regard to any use of kerosene 
     and containing at least 20 percent biodiesel.
       ``(2) Residential property.--In the case of any property 
     installed on property which is

[[Page 17918]]

     used as the principal residence (within the meaning of 
     section 121) of the taxpayer, paragraph (1) of section 
     179A(d) shall not apply.
       ``(d) Application With Other Credits.--
       ``(1) Business credit treated as part of general business 
     credit.--So much of the credit which would be allowed under 
     subsection (a) for any taxable year (determined without 
     regard to this subsection) that is attributable to property 
     of a character subject to an allowance for depreciation shall 
     be treated as a credit listed in section 38(b) for such 
     taxable year (and not allowed under subsection (a)).
       ``(2) Personal credit.--The credit allowed under subsection 
     (a) (after the application of paragraph (1)) for any taxable 
     year shall not exceed the excess (if any) of--
       ``(A) the regular tax reduced by the sum of the credits 
     allowable under subpart A and sections 27, 30, and 30B, over
       ``(B) the tentative minimum tax for the taxable year.
       ``(e) Special Rules.--For purposes of this section--
       ``(1) Basis reduction.--The basis of any property shall be 
     reduced by the portion of the cost of such property taken 
     into account under subsection (a).
       ``(2) Property used by tax-exempt entity.--In the case of 
     any qualified alternative fuel vehicle refueling property the 
     use of which is described in paragraph (3) or (4) of section 
     50(b) and which is not subject to a lease, the person who 
     sold such property to the person or entity using such 
     property shall be treated as the taxpayer that placed such 
     property in service, but only if such person clearly 
     discloses to such person or entity in a document the amount 
     of any credit allowable under subsection (a) with respect to 
     such property (determined without regard to subsection (d)).
       ``(3) Property used outside united states not qualified.--
     No credit shall be allowable under subsection (a) with 
     respect to any property referred to in section 50(b)(1) or 
     with respect to the portion of the cost of any property taken 
     into account under section 179.
       ``(4) Election not to take credit.--No credit shall be 
     allowed under subsection (a) for any property if the taxpayer 
     elects not to have this section apply to such property.
       ``(5) Recapture rules.--Rules similar to the rules of 
     section 179A(e)(4) shall apply.
       ``(f) Regulations.--The Secretary shall prescribe such 
     regulations as necessary to carry out the provisions of this 
     section.
       ``(g) Termination.--This section shall not apply to any 
     property placed in service--
       ``(1) in the case of property relating to hydrogen, after 
     December 31, 2014, and
       ``(2) in the case of any other property, after December 31, 
     2009.''.
       (b) Conforming Amendments.--
       (1) Section 38(b), as amended by this Act, is amended by 
     striking ``plus'' at the end of paragraph (24), by striking 
     the period at the end of paragraph (25) and inserting ``, 
     and'', and by adding at the end the following new paragraph:
       ``(26) the portion of the alternative fuel vehicle 
     refueling property credit to which section 30C(d)(1) 
     applies.''.
       (2) Section 1016(a), as amended by this Act, is amended by 
     striking ``and'' at the end of paragraph (35), by striking 
     the period at the end of paragraph (36) and inserting ``, 
     and'', and by adding at the end the following new paragraph:
       ``(37) to the extent provided in section 30C(f).''.
       (3) Section 55(c)(2), as amended by this Act, is amended by 
     inserting ``30C(d)(2),'' after ``30B(g)(2),''.
       (4) Section 6501(m) is amended by inserting ``30C(e)(5),'' 
     after ``30B(h)(9),''.
       (5) The table of sections for subpart B of part IV of 
     subchapter A of chapter 1, as amended by this Act, is amended 
     by inserting after the item relating to section 30B the 
     following new item:

``Sec. 30C. Clean-fuel vehicle refueling property credit.''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to property placed in service after December 31, 
     2005, in taxable years ending after such date.

     SEC. 1343. REDUCED MOTOR FUEL EXCISE TAX ON CERTAIN MIXTURES 
                   OF DIESEL FUEL.

       (a) In General.--Paragraph (2) of section 4081(a) is 
     amended by adding at the end the following:
       ``(D) Diesel-water fuel emulsion.--In the case of diesel-
     water fuel emulsion at least 14 percent of which is water and 
     with respect to which the emulsion additive is registered by 
     a United States manufacturer with the Environmental 
     Protection Agency pursuant to section 211 of the Clean Air 
     Act (as in effect on March 31, 2003), subparagraph (A)(iii) 
     shall be applied by substituting `19.7 cents' for `24.3 
     cents'. The preceding sentence shall not apply to the 
     removal, sale, or use of diesel-water fuel emulsion unless 
     the person so removing, selling, or using such fuel is 
     registered under section 4101.''.
       (b) Special Rules for Diesel-Water Fuel Emulsions.--
       (1) Refunds for tax-paid purchases.--Section 6427 is 
     amended by redesignating subsections (m) through (p) as 
     subsections (n) through (q), respectively, and by inserting 
     after subsection (l) the following new subsection:
       ``(m) Diesel Fuel Used to Produce Emulsion.--
       ``(1) In general.--Except as provided in subsection (k), if 
     any diesel fuel on which tax was imposed by section 4081 at 
     the regular tax rate is used by any person in producing an 
     emulsion described in section 4081(a)(2)(D) which is sold or 
     used in such person's trade or business, the Secretary shall 
     pay (without interest) to such person an amount equal to the 
     excess of the regular tax rate over the incentive tax rate 
     with respect to such fuel.
       ``(2) Definitions.--For purposes of paragraph (1)--
       ``(A) Regular tax rate.--The term `regular tax rate' means 
     the aggregate rate of tax imposed by section 4081 determined 
     without regard to section 4081(a)(2)(D).
       ``(B) Incentive tax rate.--The term `incentive tax rate' 
     means the aggregate rate of tax imposed by section 4081 
     determined with regard to section 4081(a)(2)(D).''.
       (2) Later separation of fuel.--Section 4081 (relating to 
     imposition of tax) is amended by inserting after subsection 
     (b) the following new subsection:
       ``(c) Later Separation of Fuel From Diesel-Water Fuel 
     Emulsion.--If any person separates the taxable fuel from a 
     diesel-water fuel emulsion on which tax was imposed under 
     subsection (a) at a rate determined under subsection 
     (a)(2)(D) (or with respect to which a credit or payment was 
     allowed or made by reason of section 6427), such person shall 
     be treated as the refiner of such taxable fuel. The amount of 
     tax imposed on any removal of such fuel by such person shall 
     be reduced by the amount of tax imposed (and not credited or 
     refunded) on any prior removal or entry of such fuel.''.
       (3) Credit claims.--Paragraphs (1) and (2) of section 
     6427(i) are both amended by inserting ``(m),'' after 
     ``(l),''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect on January 1, 2006.

     SEC. 1344. EXTENSION OF EXCISE TAX PROVISIONS AND INCOME TAX 
                   CREDIT FOR BIODIESEL.

       (a) In General.--Sections 40A(e), 6426(c)(6), and 
     6427(e)(4)(B) are each amended by striking ``2006'' and 
     inserting ``2008''.
       (b) Effective Date.--The amendments made by this section 
     shall take effect on the date of the enactment of this Act.

     SEC. 1345. SMALL AGRI-BIODIESEL PRODUCER CREDIT.

       (a) In General.--Subsection (a) of section 40A (relating to 
     biodiesel used as a fuel) is amended to read as follows:
       ``(a) General Rule.--For purposes of section 38, the 
     biodiesel fuels credit determined under this section for the 
     taxable year is an amount equal to the sum of--
       ``(1) the biodiesel mixture credit, plus
       ``(2) the biodiesel credit, plus
       ``(3) in the case of an eligible small agri-biodiesel 
     producer, the small agri-biodiesel producer credit.''.
       (b) Small Agri-biodiesel Producer Credit Defined.--Section 
     40A(b) (relating to definition of biodiesel mixture credit 
     and biodiesel credit) is amended by adding at the end the 
     following new paragraph:
       ``(5) Small agri-biodiesel producer credit.--
       ``(A) In general.--The small agri-biodiesel producer credit 
     of any eligible small agri-biodiesel producer for any taxable 
     year is 10 cents for each gallon of qualified agri-biodiesel 
     production of such producer.
       ``(B) Qualified agri-biodiesel production.--For purposes of 
     this paragraph, the term `qualified agri-biodiesel 
     production' means any agri-biodiesel (determined without 
     regard to the last sentence of subsection (d)(2)) which is 
     produced by an eligible small agri-biodiesel producer, and 
     which during the taxable year--
       ``(i) is sold by such producer to another person--

       ``(I) for use by such other person in the production of a 
     qualified biodiesel mixture in such other person's trade or 
     business (other than casual off-farm production),
       ``(II) for use by such other person as a fuel in a trade or 
     business, or
       ``(III) who sells such agri-biodiesel at retail to another 
     person and places such agri-biodiesel in the fuel tank of 
     such other person, or

       ``(ii) is used or sold by such producer for any purpose 
     described in clause (i).
       ``(C) Limitation.--The qualified agri-biodiesel production 
     of any producer for any taxable year shall not exceed 
     15,000,000 gallons.''.
       (c) Definitions and Special Rules.--Section 40A is amended 
     by redesignating subsection (e) as subsection (f) and by 
     inserting after subsection (d) the following new subsection:
       ``(e) Definitions and Special Rules for Small Agri-
     biodiesel Producer Credit.--For purposes of this section--
       ``(1) Eligible small agri-biodiesel producer.--The term 
     `eligible small agri-biodiesel producer' means a person who, 
     at all times during the taxable year, has a productive 
     capacity for agri-biodiesel not in excess of 60,000,000 
     gallons.
       ``(2) Aggregation rule.--For purposes of the 15,000,000 
     gallon limitation under subsection (b)(5)(C) and the 
     60,000,000 gallon limitation under paragraph (1), all members 
     of the same controlled group of corporations (within the 
     meaning of section 267(f)) and all persons under common 
     control (within the meaning of section 52(b) but determined 
     by treating an interest of more than 50 percent as a 
     controlling interest) shall be treated as 1 person.
       ``(3) Partnership, s corporation, and other pass-thru 
     entities.--In the case of a partnership, trust, S 
     corporation, or other pass-thru entity, the limitations 
     contained in subsection (b)(5)(C) and paragraph (1) shall be 
     applied at the entity level and at the partner or similar 
     level.
       ``(4) Allocation.--For purposes of this subsection, in the 
     case of a facility in which more

[[Page 17919]]

     than 1 person has an interest, productive capacity shall be 
     allocated among such persons in such manner as the Secretary 
     may prescribe.
       ``(5) Regulations.--The Secretary may prescribe such 
     regulations as may be necessary--
       ``(A) to prevent the credit provided for in subsection 
     (a)(3) from directly or indirectly benefiting any person with 
     a direct or indirect productive capacity of more than 
     60,000,000 gallons of agri-biodiesel during the taxable year, 
     or
       ``(B) to prevent any person from directly or indirectly 
     benefiting with respect to more than 15,000,000 gallons 
     during the taxable year.
       ``(6) Allocation of small agri-biodiesel credit to patrons 
     of cooperative.--
       ``(A) Election to allocate.--
       ``(i) In general.--In the case of a cooperative 
     organization described in section 1381(a), any portion of the 
     credit determined under subsection (a)(3) for the taxable 
     year may, at the election of the organization, be apportioned 
     pro rata among patrons of the organization on the basis of 
     the quantity or value of business done with or for such 
     patrons for the taxable year.
       ``(ii) Form and effect of election.--An election under 
     clause (i) for any taxable year shall be made on a timely 
     filed return for such year. Such election, once made, shall 
     be irrevocable for such taxable year. Such election shall not 
     take effect unless the organization designates the 
     apportionment as such in a written notice mailed to its 
     patrons during the payment period described in section 
     1382(d).
       ``(B) Treatment of organizations and patrons.--
       ``(i) Organizations.--The amount of the credit not 
     apportioned to patrons pursuant to subparagraph (A) shall be 
     included in the amount determined under subsection (a)(3) for 
     the taxable year of the organization.
       ``(ii) Patrons.--The amount of the credit apportioned to 
     patrons pursuant to subparagraph (A) shall be included in the 
     amount determined under such subsection for the first taxable 
     year of each patron ending on or after the last day of the 
     payment period (as defined in section 1382(d)) for the 
     taxable year of the organization or, if earlier, for the 
     taxable year of each patron ending on or after the date on 
     which the patron receives notice from the cooperative of the 
     apportionment.
       ``(iii) Special rules for decrease in credits for taxable 
     year.--If the amount of the credit of the organization 
     determined under such subsection for a taxable year is less 
     than the amount of such credit shown on the return of the 
     organization for such year, an amount equal to the excess 
     of--

       ``(I) such reduction, over
       ``(II) the amount not apportioned to such patrons under 
     subparagraph (A) for the taxable year, shall be treated as an 
     increase in tax imposed by this chapter on the organization. 
     Such increase shall not be treated as tax imposed by this 
     chapter for purposes of determining the amount of any credit 
     under this chapter or for purposes of section 55.''.

       (d) Conforming Amendments.--
       (1) Paragraph (4) of section 40A(b) is amended by striking 
     ``this section'' and inserting ``paragraph (1) or (2) of 
     subsection (a)''.
       (2) The heading of subsection (b) of section 40A is amended 
     by striking ``and Biodiesel Credit'' and inserting ``, 
     Biodiesel Credit, and Small Agri-biodiesel Producer Credit''.
       (3) Paragraph (3) of section 40A(d) is amended by 
     redesignating subparagraph (C) as subparagraph (D) and by 
     inserting after subparagraph (B) the following new 
     subparagraph:
       ``(C) Producer credit.--If--
       ``(i) any credit was determined under subsection (a)(3), 
     and
       ``(ii) any person does not use such fuel for a purpose 
     described in subsection (b)(5)(B), then there is hereby 
     imposed on such person a tax equal to 10 cents a gallon for 
     each gallon of such agri-biodiesel.''.
       (e) Effective Date.--The amendments made by this section 
     shall apply to taxable years ending after the date of the 
     enactment of this Act.

     SEC. 1346. RENEWABLE DIESEL.

       (a) In General.--Section 40A (relating to biodiesel used as 
     fuel), as amended by this Act, is amended by redesignating 
     subsection (f) as subsection (g) and by inserting after 
     subsection (e) the following new subsection:
       ``(f) Renewable Diesel.--For purposes of this title--
       ``(1) Treatment in the same manner as biodiesel.--Except as 
     provided in paragraph (2), renewable diesel shall be treated 
     in the same manner as biodiesel.
       ``(2) Exceptions.--
       ``(A) Rate of credit.--Subsections (b)(1)(A) and (b)(2)(A) 
     shall be applied with respect to renewable diesel by 
     substituting `$1.00' for `50 cents'.
       ``(B) Nonapplication of certain credits.--Subsections 
     (b)(3) and (b)(5) shall not apply with respect to renewable 
     diesel.
       ``(3) Renewable diesel defined.--The term `renewable 
     diesel' means diesel fuel derived from biomass (as defined in 
     section 45K(c)(3)) using a thermal depolymerization process 
     which meets--
       ``(A) the registration requirements for fuels and fuel 
     additives established by the Environmental Protection Agency 
     under section 211 of the Clean Air Act (42 U.S.C. 7545), and
       ``(B) the requirements of the American Society of Testing 
     and Materials D975 or D396.''.
       (b) Clerical Amendments.--
       (1) The heading for section 40A is amended by inserting 
     ``and RENEWABLE diesel'' after ``BIODIESEL''.
       (2) The item in the table of contents for subpart D of part 
     IV of subchapter A of chapter 1 relating to section 40A is 
     amended to read as follows:

``Sec. 40A. Biodiesel and renewable diesel used as fuel.''.
       (c) Effective Date.--The amendment made by subsection (a) 
     shall apply with respect to fuel sold or used after December 
     31, 2005.

     SEC. 1347. MODIFICATION OF SMALL ETHANOL PRODUCER CREDIT.

       (a) Definition of Small Ethanol Producer.--Section 40(g) 
     (relating to definitions and special rules for eligible small 
     ethanol producer credit) is amended by striking 
     ``30,000,000'' each place it appears and inserting 
     ``60,000,000''.
       (b) Written Notice of Election to Allocate Credit to 
     Patrons.--Section 40(g)(6)(A)(ii) (relating to form and 
     effect of election) is amended by adding at the end the 
     following new sentence: ``Such election shall not take effect 
     unless the organization designates the apportionment as such 
     in a written notice mailed to its patrons during the payment 
     period described in section 1382(d).''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years ending after the date of the 
     enactment of this Act.

     SEC. 1348. SUNSET OF DEDUCTION FOR CLEAN-FUEL VEHICLES AND 
                   CERTAIN REFUELING PROPERTY.

       Subsection (f) of section 179A (relating to termination) is 
     amended by striking ``December 31, 2006'' and inserting 
     ``December 31, 2005''.
              Subtitle E--Additional Energy Tax Incentives

     SEC. 1351. EXPANSION OF RESEARCH CREDIT.

       (a) Credit for Expenses Attributable to Certain 
     Collaborative Energy Research Consortia.--
       (1) In general.--Section 41(a) (relating to credit for 
     increasing research activities) is amended by striking 
     ``and'' at the end of paragraph (1), by striking the period 
     at the end of paragraph (2) and inserting ``, and'', and by 
     adding at the end the following new paragraph:
       ``(3) 20 percent of the amounts paid or incurred by the 
     taxpayer in carrying on any trade or business of the taxpayer 
     during the taxable year (including as contributions) to an 
     energy research consortium.''.
       (2) Energy research consortium defined.--Section 41(f) 
     (relating to special rules) is amended by adding at the end 
     the following new paragraph:
       ``(6) Energy research consortium.--
       ``(A) In general.--The term `energy research consortium' 
     means any organization--
       ``(i) which is--

       ``(I) described in section 501(c)(3) and is exempt from tax 
     under section 501(a) and is organized and operated primarily 
     to conduct energy research, or
       ``(II) organized and operated primarily to conduct energy 
     research in the public interest (within the meaning of 
     section 501(c)(3)),

       ``(ii) which is not a private foundation,
       ``(iii) to which at least 5 unrelated persons paid or 
     incurred during the calendar year in which the taxable year 
     of the organization begins amounts (including as 
     contributions) to such organization for energy research, and
       ``(iv) to which no single person paid or incurred 
     (including as contributions) during such calendar year an 
     amount equal to more than 50 percent of the total amounts 
     received by such organization during such calendar year for 
     energy research.
       ``(B) Treatment of persons.--All persons treated as a 
     single employer under subsection (a) or (b) of section 52 
     shall be treated as related persons for purposes of 
     subparagraph (A)(iii) and as a single person for purposes of 
     subparagraph (A)(iv).''.
       (3) Conforming amendment.--Section 41(b)(3)(C) is amended 
     by inserting ``(other than an energy research consortium)'' 
     after ``organization''.
       (b) Repeal of Limitation on Contract Research Expenses Paid 
     to Small Businesses, Universities, and Federal 
     Laboratories.--Section 41(b)(3) (relating to contract 
     research expenses) is amended by adding at the end the 
     following new subparagraph:
       ``(D) Amounts paid to eligible small businesses, 
     universities, and federal laboratories.--
       ``(i) In general.--In the case of amounts paid by the 
     taxpayer to--

       ``(I) an eligible small business,
       ``(II) an institution of higher education (as defined in 
     section 3304(f)), or
       ``(III) an organization which is a Federal laboratory,

     for qualified research which is energy research, subparagraph 
     (A) shall be applied by substituting `100 percent' for `65 
     percent'.
       ``(ii) Eligible small business.--For purposes of this 
     subparagraph, the term `eligible small business' means a 
     small business with respect to which the taxpayer does not 
     own (within the meaning of section 318) 50 percent or more 
     of--

       ``(I) in the case of a corporation, the outstanding stock 
     of the corporation (either by vote or value), and
       ``(II) in the case of a small business which is not a 
     corporation, the capital and profits interests of the small 
     business.

       ``(iii) Small business.--For purposes of this 
     subparagraph--

       ``(I) In general.--The term `small business' means, with 
     respect to any calendar year, any person if the annual 
     average number of employees employed by such person during 
     either of the 2 preceding calendar years was 500 or fewer. 
     For purposes of the preceding sentence, a preceding calendar 
     year may be taken into account only if the person was in 
     existence throughout the year.

[[Page 17920]]

       ``(II) Startups, controlled groups, and predecessors.--
     Rules similar to the rules of subparagraphs (B) and (D) of 
     section 220(c)(4) shall apply for purposes of this clause.

       ``(iv) Federal laboratory.--For purposes of this 
     subparagraph, the term `Federal laboratory' has the meaning 
     given such term by section 4(6) of the Stevenson-Wydler 
     Technology Innovation Act of 1980 (15 U.S.C. 3703(6)), as in 
     effect on the date of the enactment of the Energy Tax 
     Incentives Act of 2005.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to amounts paid or incurred after the date of the 
     enactment of this Act, in taxable years ending after such 
     date.

     SEC. 1352. NATIONAL ACADEMY OF SCIENCES STUDY AND REPORT.

       (a) Study.--Not later than 60 days after the date of the 
     enactment of this Act, the Secretary of the Treasury shall 
     enter into an agreement with the National Academy of Sciences 
     under which the National Academy of Sciences shall conduct a 
     study to define and evaluate the health, environmental, 
     security, and infrastructure external costs and benefits 
     associated with the production and consumption of energy that 
     are not or may not be fully incorporated into the market 
     price of such energy, or into the Federal tax or fee or other 
     applicable revenue measure related to such production or 
     consumption.
       (b) Report.--Not later than 2 years after the date on which 
     the agreement under subsection (a) is entered into, the 
     National Academy of Sciences shall submit to Congress a 
     report on the study conducted under subsection (a).

     SEC. 1353. RECYCLING STUDY.

       (a) Study.--The Secretary of the Treasury, in consultation 
     with the Secretary of Energy, shall conduct a study--
       (1) to determine and quantify the energy savings achieved 
     through the recycling of glass, paper, plastic, steel, 
     aluminum, and electronic devices, and
       (2) to identify tax incentives which would encourage 
     recycling of such material.
       (b) Report.--Not later than one year after the date of the 
     enactment of this Act, the Secretary of the Treasury shall 
     submit to Congress a report on the study conducted under 
     subsection (a).
                 Subtitle F--Revenue Raising Provisions

     SEC. 1361. OIL SPILL LIABILITY TRUST FUND FINANCING RATE.

       Section 4611(f) (relating to application of oil spill 
     liability trust fund financing rate) is amended to read as 
     follows:
       ``(f) Application of Oil Spill Liability Trust Fund 
     Financing Rate.--
       ``(1) In general.--Except as provided in paragraphs (2) and 
     (3), the Oil Spill Liability Trust Fund financing rate under 
     subsection (c) shall apply on and after April 1, 2006, or if 
     later, the date which is 30 days after the last day of any 
     calendar quarter for which the Secretary estimates that, as 
     of the close of that quarter, the unobligated balance in the 
     Oil Spill Liability Trust Fund is less than $2,000,000,000.
       ``(2) Fund balance.--The Oil Spill Liability Trust Fund 
     financing rate shall not apply during a calendar quarter if 
     the Secretary estimates that, as of the close of the 
     preceding calendar quarter, the unobligated balance in the 
     Oil Spill Liability Trust Fund exceeds $2,700,000,000.
       ``(3) Termination.--The Oil Spill Liability Trust Fund 
     financing rate shall not apply after December 31, 2014.''.

     SEC. 1362. EXTENSION OF LEAKING UNDERGROUND STORAGE TANK 
                   TRUST FUND FINANCING RATE.

       (a) In General.--Paragraph (3) of section 4081(d) (relating 
     to Leaking Underground Storage Tank Trust Fund financing 
     rate) is amended by striking ``2005'' and inserting ``2011''.
       (b) No Exemptions From Tax Except for Exports.--
       (1) In general.--Section 4082(a) (relating to exemptions 
     for diesel fuel and kerosene) is amended by inserting 
     ``(other than such tax at the Leaking Underground Storage 
     Tank Trust Fund financing rate imposed in all cases other 
     than for export)'' after ``section 4081''.
       (2) Amendments relating to section 4041.--
       (A) Subsections (a)(1)(B), (a)(2)(A), and (c)(2) of section 
     4041 are each amended by inserting ``(other than such tax at 
     the Leaking Underground Storage Tank Trust Fund financing 
     rate)'' after ``section 4081''.
       (B) Section 4041(b)(1)(A) is amended by striking ``or 
     (d)(1))''.
       (C) Section 4041(d) is amended by adding at the end the 
     following new paragraph:
       ``(5) Nonapplication of exemptions other than for 
     exports.--For purposes of this section, the tax imposed under 
     this subsection shall be determined without regard to 
     subsections (f), (g) (other than with respect to any sale for 
     export under paragraph (3) thereof), (h), and (l).''.
       (3) No refund.--
       (A) In general.--Subchapter B of chapter 65 is amended by 
     adding at the end the following new section:

     ``SEC. 6430. TREATMENT OF TAX IMPOSED AT LEAKING UNDERGROUND 
                   STORAGE TANK TRUST FUND FINANCING RATE.

       ``No refunds, credits, or payments shall be made under this 
     subchapter for any tax imposed at the Leaking Underground 
     Storage Tank Trust Fund financing rate, except in the case of 
     fuels destined for export.''.
       (B) Clerical amendment.--The table of sections for 
     subchapter B of chapter 65 is amended by adding at the end 
     the following new item:

``Sec. 6430. Treatment of tax imposed at Leaking Underground Storage 
              Tank Trust Fund financing rate.''.

       (c) Certain Refunds and Credits Not Charged to LUST Trust 
     Fund.--Subsection (c) of section 9508 (relating to Leaking 
     Underground Storage Tank Trust Fund) is amended to read as 
     follows:
       ``(c) Expenditures.--Amounts in the Leaking Underground 
     Storage Tank Trust Fund shall be available, as provided in 
     appropriation Acts, only for purposes of making expenditures 
     to carry out section 9003(h) of the Solid Waste Disposal Act 
     as in effect on the date of the enactment of the Superfund 
     Amendments and Reauthorization Act of 1986.''.
       (d) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall take effect on October 
     1, 2005.
       (2) No exemption.--The amendments made by subsection (b) 
     shall apply to fuel entered, removed, or sold after September 
     30, 2005.

     SEC. 1363. MODIFICATION OF RECAPTURE RULES FOR AMORTIZABLE 
                   SECTION 197 INTANGIBLES.

       (a) In General.--Subsection (b) of section 1245 (relating 
     to gain from dispositions of certain depreciable property) is 
     amended by adding at the end the following new paragraph:
       ``(9) Disposition of amortizable section 197 intangibles.--
       ``(A) In general.--If a taxpayer disposes of more than 1 
     amortizable section 197 intangible (as defined in section 
     197(c)) in a transaction or a series of related transactions, 
     all such amortizable 197 intangibles shall be treated as 1 
     section 1245 property for purposes of this section.
       ``(B) Exception.--Subparagraph (A) shall not apply to any 
     amortizable section 197 intangible (as so defined) with 
     respect to which the adjusted basis exceeds the fair market 
     value.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to dispositions of property after the date of the 
     enactment of this Act.

     SEC. 1364. CLARIFICATION OF TIRE EXCISE TAX.

       (a) In General.--Section 4072(e) (defining super single 
     tire) is amended by adding at the end the following: ``Such 
     term shall not include any tire designed for steering.''
       (b) Effective Date.--The amendment made by this section 
     shall take effect as if included in section 869 of the 
     American Jobs Creation Act of 2004.
       (c) Study.--
       (1) In general.--With respect to the 1-year period 
     beginning on January 1, 2006, the Secretary of the Treasury 
     shall conduct a study to determine--
       (A) the amount of tax collected during such period under 
     section 4071 of the Internal Revenue Code of 1986 with 
     respect to each class of tire, and
       (B) the number of tires in each such class on which tax is 
     imposed under such section during such period.
       (2) Report.--Not later than July 1, 2007, the Secretary of 
     the Treasury shall submit to Congress a report on the study 
     conducted under paragraph (1).
                        TITLE XIV--MISCELLANEOUS
                         Subtitle A--In General

     SEC. 1401. SENSE OF CONGRESS ON RISK ASSESSMENTS.

       Subtitle B of title XXX of the Energy Policy Act of 1992 is 
     amended by adding at the end the following new section:

     ``SEC. 3022. SENSE OF CONGRESS ON RISK ASSESSMENTS.

       ``It is the sense of Congress that Federal agencies 
     conducting assessments of risks to human health and the 
     environment from energy technology, production, transport, 
     transmission, distribution, storage, use, or conservation 
     activities shall use sound and objective scientific practices 
     in assessing such risks, shall consider the best available 
     science (including peer reviewed studies), and shall include 
     a description of the weight of the scientific evidence 
     concerning such risks.''.

     SEC. 1402. ENERGY PRODUCTION INCENTIVES.

       (a) In General.--A State may provide to any entity--
       (1) a credit against any tax or fee owed to the State under 
     a State law, or
       (2) any other tax incentive,
     determined by the State to be appropriate, in the amount 
     calculated under and in accordance with a formula determined 
     by the State, for production described in subsection (b) in 
     the State by the entity that receives such credit or such 
     incentive.
       (b) Eligible Entities.--Subsection (a) shall apply with 
     respect to the production in the State of electricity from 
     coal mined in the State and used in a facility, if such 
     production meets all applicable Federal and State laws and if 
     such facility uses scrubbers or other forms of clean coal 
     technology.
       (c) Effect on Interstate Commerce.--Any action taken by a 
     State in accordance with this section with respect to a tax 
     or fee payable, or incentive applicable, for any period 
     beginning after the date of the enactment of this Act shall--
       (1) be considered to be a reasonable regulation of 
     commerce; and
       (2) not be considered to impose an undue burden on 
     interstate commerce or to otherwise impair, restrain, or 
     discriminate, against interstate commerce.

     SEC. 1403. REGULATION OF CERTAIN OIL USED IN TRANSFORMERS.

       Notwithstanding any other provision of law, or rule 
     promulgated by the Environmental Protection Agency, vegetable 
     oil made from soybeans and used in electric transformers as 
     thermal insulation shall not be regulated as an oil

[[Page 17921]]

     identified under section 2(a)(1)(B) of the Edible Oil 
     Regulatory Reform Act (33 U.S.C. 2720(a)(1)(B)).

     SEC. 1404. PETROCHEMICAL AND OIL REFINERY FACILITY HEALTH 
                   ASSESSMENT.

       (a) Establishment.--The Secretary shall conduct a study of 
     direct and significant health impacts to persons resulting 
     from living in proximity to petrochemical and oil refinery 
     facilities. The Secretary shall consult with the Director of 
     the National Cancer Institute and other Federal Government 
     bodies with expertise in the field it deems appropriate in 
     the design of such study. The study shall be conducted 
     according to sound and objective scientific practices and 
     present the weight of the scientific evidence. The Secretary 
     shall obtain scientific peer review of the draft study.
       (b) Report to Congress.--The Secretary shall transmit the 
     results of the study to Congress within 6 months of the 
     enactment of this section.
       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary for activities under this 
     section such sums as are necessary for the completion of the 
     study.

     SEC. 1405. NATIONAL PRIORITY PROJECT DESIGNATION.

       (a) Designation of National Priority Projects.--
       (1) In general.--There is established the National Priority 
     Project Designation (referred to in this section as the 
     ``Designation''), which shall be evidenced by a medal bearing 
     the inscription ``National Priority Project''.
       (2) Design and materials.--The medal shall be of such 
     design and materials and bear such additional inscriptions as 
     the President may prescribe.
       (b) Making and Presentation of Designation.--
       (1) In general.--The President, on the basis of 
     recommendations made by the Secretary, shall annually 
     designate organizations that have--
       (A) advanced the field of renewable energy technology and 
     contributed to North American energy independence; and
       (B) been certified by the Secretary under subsection (e).
       (2) Presentation.--The President shall designate projects 
     with such ceremonies as the President may prescribe.
       (3) Use of designation.--An organization that receives a 
     Designation under this section may publicize the Designation 
     of the organization as a National Priority Project in 
     advertising.
       (4) Categories in which the designation may be given.--
     Separate Designations shall be made to qualifying projects in 
     each of the following categories:
       (A) Wind and biomass energy generation projects.
       (B) Photovoltaic and fuel cell energy generation projects.
       (C) Energy efficient building and renewable energy 
     projects.
       (D) First-in-Class projects.
       (c) Selection Criteria.--
       (1) In general.--Certification and selection of the 
     projects to receive the Designation shall be based on 
     criteria established under this subsection.
       (2) Wind, biomass, and building projects.--In the case of a 
     wind, biomass, or building project, the project shall 
     demonstrate that the project will install not less than 30 
     megawatts of renewable energy generation capacity.
       (3) Solar photovoltaic and fuel cell projects.--In the case 
     of a solar photovoltaic or fuel cell project, the project 
     shall demonstrate that the project will install not less than 
     3 megawatts of renewable energy generation capacity.
       (4) Energy efficient building and renewable energy 
     projects.--In the case of an energy efficient building or 
     renewable energy project, in addition to meeting the criteria 
     established under paragraph (2), each building project shall 
     demonstrate that the project will--
       (A) comply with third-party certification standards for 
     high-performance, sustainable buildings;
       (B) use whole-building integration of energy efficiency and 
     environmental performance design and technology, including 
     advanced building controls;
       (C) use renewable energy for at least 50 percent of the 
     energy consumption of the project;
       (D) comply with applicable Energy Star standards; and
       (E) include at least 5,000,000 square feet of enclosed 
     space.
       (5) First-in-class use.--Notwithstanding paragraphs (2) 
     through (4), a new building project may qualify under this 
     section if the Secretary determines that the project--
       (A) represents a First-In-Class use of renewable energy; or
       (B) otherwise establishes a new paradigm of building 
     integrated renewable energy use or energy efficiency.
       (d) Application.--
       (1) Initial applications.--No later than 120 days after the 
     date of enactment of this Act, and annually thereafter, the 
     Secretary shall publish in the Federal Register an invitation 
     and guidelines for submitting applications, consistent with 
     this section.
       (2) Contents.--The application shall describe the project, 
     or planned project, and the plans to meet the criteria 
     established under subsection (c).
       (e) Certification.--
       (1) In general.--Not later than 60 days after the 
     application period described in subsection (d), and annually 
     thereafter, the Secretary shall certify projects that are 
     reasonably expected to meet the criteria established under 
     subsection (c).
       (2) Certified projects.--The Secretary shall designate 
     personnel of the Department to work with persons carrying out 
     each certified project and ensure that the personnel--
       (A) provide each certified project with guidance in meeting 
     the criteria established under subsection (c);
       (B) identify programs of the Department, including National 
     Laboratories and Technology Centers, that will assist each 
     project in meeting the criteria established under subsection 
     (c); and
       (C) ensure that knowledge and transfer of the most current 
     technology between the applicable resources of the Federal 
     Government (including the National Laboratories and 
     Technology Centers, the Department, and the Environmental 
     Protection Agency) and the certified projects is being 
     facilitated to accelerate commercialization of work developed 
     through those resources.
       (f) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section for each of fiscal years 2006 through 2010.

     SEC. 1406. COLD CRACKING.

       (a) Study.--The Secretary shall conduct a study of the 
     application of radiation to petroleum at standard temperature 
     and pressure to refine petroleum products, whose objective 
     shall be to increase the economic yield from each barrel of 
     oil.
       (b) Goals.--The goals of the study shall include--
       (1) increasing the value of our current oil supply;
       (2) reducing the capital investment cost for cracking oil;
       (3) reducing the operating energy cost for cracking oil; 
     and
       (4) reducing sulfur content using an environmentally 
     responsible method.
       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section $250,000 for 
     fiscal year 2006.

     SEC. 1407. OXYGEN-FUEL.

       (a) Program.--The Secretary shall establish a program on 
     oxygen-fuel systems. If feasible, the program shall include 
     renovation of at least one existing large unit and one 
     existing small unit, and construction of one new large unit 
     and one new small unit.
       (b) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary for carrying out this 
     section--
       (1) $100,000,000 for fiscal year 2006;
       (2) $100,000,000 for fiscal year 2007; and
       (3) $100,000,000 for fiscal year 2008.
       (c) Definitions.--For purposes of this section--
       (1) the term ``large unit'' means a unit with a generating 
     capacity of 100 megawatts or more;
       (2) the term ``oxygen-fuel systems'' means systems that 
     utilize fuel efficiency benefits of oil, gas, coal, and 
     biomass combustion using substantially pure oxygen, with high 
     flame temperatures and the exclusion of air from the boiler, 
     in industrial or electric utility steam generating units; and
       (3) the term ``small unit'' means a unit with a generating 
     capacity in the 10-50 megawatt range.
                      Subtitle B--Set America Free

     SEC. 1421. SHORT TITLE.

       This subtitle may be cited as the ``Set America Free Act of 
     2005'' or the ``SAFE Act''.

     SEC. 1422. PURPOSE.

       The purpose of this subtitle is to establish a United 
     States commission to make recommendations for a coordinated 
     and comprehensive North American energy policy that will 
     achieve energy self-sufficiency by 2025 within the three 
     contiguous North American nation area of Canada, Mexico, and 
     the United States.

     SEC. 1423. UNITED STATES COMMISSION ON NORTH AMERICAN ENERGY 
                   FREEDOM.

       (a) Establishment.--There is hereby established the United 
     States Commission on North American Energy Freedom (in this 
     subtitle referred to as the ``Commission''). The Federal 
     Advisory Committee Act (5 U.S.C. App.), except sections 3, 7, 
     and 12, does not apply to the Commission.
       (b) Membership.--
       (1) Appointment.--The Commission shall be composed of 16 
     members appointed by the President from among individuals 
     described in paragraph (2) who are knowledgeable on energy 
     issues, including oil and gas exploration and production, 
     crude oil refining, oil and gas pipelines, electricity 
     production and transmission, coal, unconventional hydrocarbon 
     resources, fuel cells, motor vehicle power systems, nuclear 
     energy, renewable energy, biofuels, energy efficiency, and 
     energy conservation. The membership of the Commission shall 
     be balanced by area of expertise to the extent consistent 
     with maintaining the highest level of expertise on the 
     Commission. Members of the Commission may be citizens of 
     Canada, Mexico, or the United States, and the President shall 
     ensure that citizens of all three nations are appointed to 
     the Commission.
       (2) Nominations.--The President shall appoint the members 
     of the Commission within 60 days after the effective date of 
     this Act, including individuals nominated as follows:
       (A) Four members shall be appointed from amongst 
     individuals independently determined by the President to be 
     qualified for appointment.

[[Page 17922]]

       (B) Four members shall be appointed from a list of eight 
     individuals who shall be nominated by the majority leader of 
     the Senate in consultation with the chairman of the Committee 
     on Energy and Natural Resources of the Senate.
       (C) Four members shall be appointed from a list of eight 
     individuals who shall be nominated by the Speaker of the 
     House of Representatives in consultation with the chairmen of 
     the Committees on Energy and Commerce and Resources of the 
     House of Representatives.
       (D) Two members shall be appointed from a list of four 
     individuals who shall be nominated by the minority leader of 
     the Senate in consultation with the ranking Member of the 
     Committee on Energy and Natural Resources of the Senate.
       (E) Two members shall be appointed from a list of four 
     individuals who shall be nominated by the minority leader of 
     the House in consultation with the ranking Members of the 
     Committees on Energy and Commerce and Resources of the House 
     of Representatives.
       (3) Chairman.--The chairman of the Commission shall be 
     selected by the President. The chairman of the Commission 
     shall be responsible for--
       (A) the assignment of duties and responsibilities among 
     staff personnel and their continuing supervision; and
       (B) the use and expenditure of funds available to the 
     Commission.
       (4) Vacancies.--Any vacancy on the Commission shall be 
     filled in the same manner as the original incumbent was 
     appointed.
       (c) Resources.--In carrying out its functions under this 
     section, the Commission--
       (1) is authorized to secure directly from any Federal 
     agency or department any information it deems necessary to 
     carry out its functions under this Act, and each such agency 
     or department is authorized to cooperate with the Commission 
     and, to the extent permitted by law, to furnish such 
     information (other than information described in section 
     552(b)(1)(A) of title 5, United States Code) to the 
     Commission, upon the request of the Commission;
       (2) may enter into contracts, subject to the availability 
     of appropriations for contracting, and employ such staff 
     experts and consultants as may be necessary to carry out the 
     duties of the Commission, as provided by section 3109 of 
     title 5, United States Code; and
       (3) shall establish a multidisciplinary science and 
     technical advisory panel of experts in the field of energy to 
     assist the Commission in preparing its report, including 
     ensuring that the scientific and technical information 
     considered by the Commission is based on the best scientific 
     and technical information available.
       (d) Staffing.--The chairman of the Commission may, without 
     regard to the civil service laws and regulations, appoint and 
     terminate an executive director and such other additional 
     personnel as may be necessary for the Commission to perform 
     its duties. The executive director shall be compensated at a 
     rate not to exceed the rate payable for Level IV of the 
     Executive Schedule under chapter 5136 of title 5, United 
     States Code. The chairman shall select staff from among 
     qualified citizens of Canada, Mexico, and the United States 
     of America.
       (e) Meetings.--
       (1) Administration.--All meetings of the Commission shall 
     be open to the public, except that a meeting or any portion 
     of it may be closed to the public if it concerns matters or 
     information described in section 552b(c) of title 5, United 
     States Code. Interested persons shall be permitted to appear 
     at open meetings and present oral or written statements on 
     the subject matter of the meeting. The Commission may 
     administer oaths or affirmations to any person appearing 
     before it.
       (2) Notice; minutes; public availability of documents.--
       (A) Notice.--All open meetings of the Commission shall be 
     preceded by timely public notice in the Federal Register of 
     the time, place, and subject of the meeting.
       (B) Minutes.--Minutes of each meeting shall be kept and 
     shall contain a record of the people present, a description 
     of the discussion that occurred, and copies of all statements 
     filed. Subject to section 552 of title 5, United States Code, 
     the minutes and records of all meetings and other documents 
     that were made available to or prepared for the Commission 
     shall be available for public inspection and copying at a 
     single location in the offices of the Commission.
       (3) Initial meeting.--The Commission shall hold its first 
     meeting within 30 days after all 16 members have been 
     appointed.
       (f) Report.--Within 12 months after the effective date of 
     this Act, the Commission shall submit to Congress and the 
     President a final report of its findings and recommendations 
     regarding North American energy freedom.
       (g) Administrative Procedure for Report and Review.--
     Chapter 5 and chapter 7 of title 5, United States Code, do 
     not apply to the preparation, review, or submission of the 
     report required by subsection (f).
       (h) Termination.--The Commission shall cease to exist 90 
     days after the date on which it submits its final report.
       (i) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this chapter a total of 
     $10,000,000 for the 2 fiscal-year period beginning with 
     fiscal year 2005, such sums to remain available until 
     expended.

     SEC. 1424. NORTH AMERICAN ENERGY FREEDOM POLICY.

       Within 90 days after receiving and considering the report 
     and recommendations of the Commission under section 1423, the 
     President shall submit to Congress a statement of proposals 
     to implement or respond to the Commission's recommendations 
     for a coordinated, comprehensive, and long-range national 
     policy to achieve North American energy freedom by 2025.
                   TITLE XV--ETHANOL AND MOTOR FUELS
                     Subtitle A--General Provisions

     SEC. 1501. RENEWABLE CONTENT OF GASOLINE.

       (a) In General.--Section 211 of the Clean Air Act (42 
     U.S.C. 7545) is amended--
       (1) by redesignating subsection (o) as subsection (r); and
       (2) by inserting after subsection (n) the following:
       ``(o) Renewable Fuel Program.--
       ``(1) Definitions.--In this section:
       ``(A) Cellulosic biomass ethanol.--The term `cellulosic 
     biomass ethanol' means ethanol derived from any 
     lignocellulosic or hemicellulosic matter that is available on 
     a renewable or recurring basis, including--
       ``(i) dedicated energy crops and trees;
       ``(ii) wood and wood residues;
       ``(iii) plants;
       ``(iv) grasses;
       ``(v) agricultural residues;
       ``(vi) fibers;
       ``(vii) animal wastes and other waste materials; and
       ``(viii) municipal solid waste.
     The term also includes any ethanol produced in facilities 
     where animal wastes or other waste materials are digested or 
     otherwise used to displace 90 percent or more of the fossil 
     fuel normally used in the production of ethanol.
       ``(B) Waste derived ethanol.--The term `waste derived 
     ethanol' means ethanol derived from--
       ``(i) animal wastes, including poultry fats and poultry 
     wastes, and other waste materials; or
       ``(ii) municipal solid waste.
       ``(C) Renewable fuel.--
       ``(i) In general.--The term `renewable fuel' means motor 
     vehicle fuel that--

       ``(I)(aa) is produced from grain, starch, oilseeds, 
     vegetable, animal, or fish materials including fats, greases, 
     and oils, sugarcane, sugar beets, sugar components, tobacco, 
     potatoes, or other biomass; or
       ``(bb) is natural gas produced from a biogas source, 
     including a landfill, sewage waste treatment plant, feedlot, 
     or other place where decaying organic material is found; and
       ``(II) is used to replace or reduce the quantity of fossil 
     fuel present in a fuel mixture used to operate a motor 
     vehicle.

       ``(ii) Inclusion.--The term `renewable fuel' includes--

       ``(I) cellulosic biomass ethanol and `waste derived 
     ethanol'; and
       ``(II) biodiesel (as defined in section 312(f) of the 
     Energy Policy Act of 1992 (42 U.S.C. 13220(f))) and any 
     blending components derived from renewable fuel (provided 
     that only the renewable fuel portion of any such blending 
     component shall be considered part of the applicable volume 
     under the renewable fuel program established by this 
     subsection).

       ``(D) Small refinery.--The term `small refinery' means a 
     refinery for which the average aggregate daily crude oil 
     throughput for a calendar year (as determined by dividing the 
     aggregate throughput for the calendar year by the number of 
     days in the calendar year) does not exceed 75,000 barrels.
       ``(2) Renewable fuel program.--
       ``(A) Regulations.--
       ``(i) In general.--Not later than 1 year after the date of 
     enactment of this paragraph, the Administrator shall 
     promulgate regulations to ensure that gasoline sold or 
     introduced into commerce in the United States (except in 
     noncontiguous States or territories), on an annual average 
     basis, contains the applicable volume of renewable fuel 
     determined in accordance with subparagraph (B).
       ``(ii) Noncontiguous state opt-in.--

       ``(I) In general.--On the petition of a noncontiguous State 
     or territory, the Administrator may allow the renewable fuel 
     program established under this subsection to apply in the 
     noncontiguous State or territory at the same time or any time 
     after the Administrator promulgates regulations under this 
     subparagraph.
       ``(II) Other actions.--In carrying out this clause, the 
     Administrator may--

       ``(aa) issue or revise regulations under this paragraph;
       ``(bb) establish applicable percentages under paragraph 
     (3);
       ``(cc) provide for the generation of credits under 
     paragraph (5); and
       ``(dd) take such other actions as are necessary to allow 
     for the application of the renewable fuels program in a 
     noncontiguous State or territory.
       ``(iii) Provisions of regulations.--Regardless of the date 
     of promulgation, the regulations promulgated under clause 
     (i)--

       ``(I) shall contain compliance provisions applicable to 
     refineries, blenders, distributors, and importers, as 
     appropriate, to ensure that the requirements of this 
     paragraph are met; but
       ``(II) shall not--

       ``(aa) restrict geographic areas in which renewable fuel 
     may be used; or
       ``(bb) impose any per-gallon obligation for the use of 
     renewable fuel.
       ``(iv) Requirement in case of failure to promulgate 
     regulations.--If the Administrator does not promulgate 
     regulations under clause (i), the percentage of renewable 
     fuel in gasoline sold or dispensed to consumers in the United 
     States, on a volume basis, shall be 2.78 percent for calendar 
     year 2006.
       ``(B) Applicable volume.--

[[Page 17923]]

       ``(i) Calendar years 2006 through 2012.--For the purpose of 
     subparagraph (A), the applicable volume for any of calendar 
     years 2006 through 2012 shall be determined in accordance 
     with the following table:
                                    Applicable volume of renewable fuel
  ``Calendar year:                            (in billions of gallons):
  2006..........................................................4.0....

  2007..........................................................4.7....

  2008..........................................................5.4....

  2009..........................................................6.1....

  2010..........................................................6.8....

  2011..........................................................7.4....

  2012.........................................................7.5.....

       ``(ii) Calendar year 2013 and thereafter.--Subject to 
     clauses (iii) and (iv), for the purposes of subparagraph (A), 
     the applicable volume for calendar year 2013 and each 
     calendar year thereafter shall be determined by the 
     Administrator, in coordination with the Secretary of 
     Agriculture and the Secretary of Energy, based on a review of 
     the implementation of the program during calendar years 2006 
     through 2012, including a review of--

       ``(I) the impact of the use of renewable fuels on the 
     environment, air quality, energy security, job creation, and 
     rural economic development; and
       ``(II) the expected annual rate of future production of 
     renewable fuels, including cellulosic ethanol.

       ``(iii) Minimum quantity derived from cellulosic biomass.--
     For calendar year 2013 and each calendar year thereafter--

       ``(I) the applicable volume referred to in clause (ii) 
     shall contain a minimum of 250,000,000 gallons that are 
     derived from cellulosic biomass; and
       ``(II) the 2.5-to-1 ratio referred to in paragraph (4) 
     shall not apply.

       ``(iv) Minimum applicable volume.--For the purpose of 
     subparagraph (A), the applicable volume for calendar year 
     2013 and each calendar year thereafter shall be equal to the 
     product obtained by multiplying--

       ``(I) the number of gallons of gasoline that the 
     Administrator estimates will be sold or introduced into 
     commerce in the calendar year; and
       ``(II) the ratio that--

       ``(aa) 7,500,000,000 gallons of renewable fuel; bears to
       ``(bb) the number of gallons of gasoline sold or introduced 
     into commerce in calendar year 2012.
       ``(3) Applicable percentages.--
       ``(A) Provision of estimate of volumes of gasoline sales.--
     Not later than October 31 of each of calendar years 2005 
     through 2011, the Administrator of the Energy Information 
     Administration shall provide to the Administrator of the 
     Environmental Protection Agency an estimate, with respect to 
     the following calendar year, of the volumes of gasoline 
     projected to be sold or introduced into commerce in the 
     United States.
       ``(B) Determination of applicable percentages.--
       ``(i) In general.--Not later than November 30 of each of 
     calendar years 2005 through 2012, based on the estimate 
     provided under subparagraph (A), the Administrator of the 
     Environmental Protection Agency shall determine and publish 
     in the Federal Register, with respect to the following 
     calendar year, the renewable fuel obligation that ensures 
     that the requirements of paragraph (2) are met.
       ``(ii) Required elements.--The renewable fuel obligation 
     determined for a calendar year under clause (i) shall--

       ``(I) be applicable to refineries, blenders, and importers, 
     as appropriate;
       ``(II) be expressed in terms of a volume percentage of 
     gasoline sold or introduced into commerce in the United 
     States; and
       ``(III) subject to subparagraph (C)(i), consist of a single 
     applicable percentage that applies to all categories of 
     persons specified in subclause (I).

       ``(C) Adjustments.--In determining the applicable 
     percentage for a calendar year, the Administrator shall make 
     adjustments--
       ``(i) to prevent the imposition of redundant obligations on 
     any person specified in subparagraph (B)(ii)(I); and
       ``(ii) to account for the use of renewable fuel during the 
     previous calendar year by small refineries that are exempt 
     under paragraph (9).
       ``(4) Cellulosic biomass ethanol or waste derived 
     ethanol.--For the purpose of paragraph (2), 1 gallon of 
     cellulosic biomass ethanol or waste derived ethanol shall be 
     considered to be the equivalent of 2.5 gallons of renewable 
     fuel.
       ``(5) Credit program.--
       ``(A) In general.--The regulations promulgated under 
     paragraph (2)(A) shall provide--
       ``(i) for the generation of an appropriate amount of 
     credits by any person that refines, blends, or imports 
     gasoline that contains a quantity of renewable fuel that is 
     greater than the quantity required under paragraph (2);
       ``(ii) for the generation of an appropriate amount of 
     credits for biodiesel; and
       ``(iii) for the generation of credits by small refineries 
     in accordance with paragraph (9)(C).
       ``(B) Use of credits.--A person that generates credits 
     under subparagraph (A) may use the credits, or transfer all 
     or a portion of the credits to another person, for the 
     purpose of complying with paragraph (2).
       ``(C) Duration of credits.--A credit generated under this 
     paragraph shall be valid to show compliance for the 12 months 
     as of the date of generation.
       ``(D) Inability to generate or purchase sufficient 
     credits.--The regulations promulgated under paragraph (2)(A) 
     shall include provisions allowing any person that is unable 
     to generate or purchase sufficient credits to meet the 
     requirements of paragraph (2) to carry forward a renewable 
     fuel deficit on condition that the person, in the calendar 
     year following the year in which the renewable fuel deficit 
     is created--
       ``(i) achieves compliance with the renewable fuel 
     requirement under paragraph (2); and
       ``(ii) generates or purchases additional renewable fuel 
     credits to offset the renewable fuel deficit of the previous 
     year.
       ``(6) Seasonal variations in renewable fuel use.--
       ``(A) Study.--For each of calendar years 2006 through 2012, 
     the Administrator of the Energy Information Administration 
     shall conduct a study of renewable fuel blending to determine 
     whether there are excessive seasonal variations in the use of 
     renewable fuel.
       ``(B) Regulation of excessive seasonal variations.--If, for 
     any calendar year, the Administrator of the Energy 
     Information Administration, based on the study under 
     subparagraph (A), makes the determinations specified in 
     subparagraph (C), the Administrator of the Environmental 
     Protection Agency shall promulgate regulations to ensure that 
     25 percent or more of the quantity of renewable fuel 
     necessary to meet the requirements of paragraph (2) is used 
     during each of the 2 periods specified in subparagraph (D) of 
     each subsequent calendar year.
       ``(C) Determinations.--The determinations referred to in 
     subparagraph (B) are that--
       ``(i) less than 25 percent of the quantity of renewable 
     fuel necessary to meet the requirements of paragraph (2) has 
     been used during 1 of the 2 periods specified in subparagraph 
     (D) of the calendar year;
       ``(ii) a pattern of excessive seasonal variation described 
     in clause (i) will continue in subsequent calendar years; and
       ``(iii) promulgating regulations or other requirements to 
     impose a 25 percent or more seasonal use of renewable fuels 
     will not prevent or interfere with the attainment of national 
     ambient air quality standards or significantly increase the 
     price of motor fuels to the consumer.
       ``(D) Periods.--The 2 periods referred to in this paragraph 
     are--
       ``(i) April through September; and
       ``(ii) January through March and October through December.
       ``(E) Exclusion.--Renewable fuel blended or consumed in 
     calendar year 2006 in a State that has received a waiver 
     under section 209(b) shall not be included in the study under 
     subparagraph (A).
       ``(F) State exemption from seasonality requirements.--
     Notwithstanding any other provision of law, the seasonality 
     requirement relating to renewable fuel use established by 
     this paragraph shall not apply to any State that has received 
     a waiver under section 209(b) or any State dependent on 
     refineries in such State for gasoline supplies.
       ``(7) Waivers.--
       ``(A) In general.--The Administrator, in consultation with 
     the Secretary of Agriculture and the Secretary of Energy, may 
     waive the requirements of paragraph (2) in whole or in part 
     on petition by 1 or more States by reducing the national 
     quantity of renewable fuel required under paragraph (2)--
       ``(i) based on a determination by the Administrator, after 
     public notice and opportunity for comment, that 
     implementation of the requirement would severely harm the 
     economy or environment of a State, a region, or the United 
     States; or
       ``(ii) based on a determination by the Administrator, after 
     public notice and opportunity for comment, that there is an 
     inadequate domestic supply.
       ``(B) Petitions for waivers.--The Administrator, in 
     consultation with the Secretary of Agriculture and the 
     Secretary of Energy, shall approve or disapprove a State 
     petition for a waiver of the requirements of paragraph (2) 
     within 90 days after the date on which the petition is 
     received by the Administrator.
       ``(C) Termination of waivers.--A waiver granted under 
     subparagraph (A) shall terminate after 1 year, but may be 
     renewed by the Administrator after consultation with the 
     Secretary of Agriculture and the Secretary of Energy.
       ``(8) Study and waiver for initial year of program.--
       ``(A) In general.--Not later than 180 days after the date 
     of enactment of this paragraph, the Secretary of Energy shall 
     conduct for the Administrator a study assessing whether the 
     renewable fuel requirement under paragraph (2) will likely 
     result in significant adverse impacts on consumers in 2006, 
     on a national, regional, or State basis.
       ``(B) Required evaluations.--The study shall evaluate 
     renewable fuel--
       ``(i) supplies and prices;
       ``(ii) blendstock supplies; and
       ``(iii) supply and distribution system capabilities.
       ``(C) Recommendations by the secretary.--Based on the 
     results of the study, the Secretary of Energy shall make 
     specific recommendations to the Administrator concerning 
     waiver of the requirements of paragraph (2), in whole or in 
     part, to prevent any adverse impacts described in 
     subparagraph (A).
       ``(D) Waiver.--
       ``(i) In general.--Not later than 270 days after the date 
     of enactment of this paragraph, the Administrator shall, if 
     and to the extent recommended by the Secretary of Energy 
     under subparagraph (C), waive, in whole or in part, the 
     renewable fuel requirement under paragraph (2) by reducing 
     the national quantity of

[[Page 17924]]

     renewable fuel required under paragraph (2) in calendar year 
     2006.
       ``(ii) No effect on waiver authority.--Clause (i) does not 
     limit the authority of the Administrator to waive the 
     requirements of paragraph (2) in whole, or in part, under 
     paragraph (7).
       ``(9) Small refineries.--
       ``(A) Temporary exemption.--
       ``(i) In general.--The requirements of paragraph (2) shall 
     not apply to small refineries until calendar year 2011.
       ``(ii) Extension of exemption.--

       ``(I) Study by secretary of energy.--Not later than 
     December 31, 2008, the Secretary of Energy shall conduct for 
     the Administrator a study to determine whether compliance 
     with the requirements of paragraph (2) would impose a 
     disproportionate economic hardship on small refineries.
       ``(II) Extension of exemption.--In the case of a small 
     refinery that the Secretary of Energy determines under 
     subclause (I) would be subject to a disproportionate economic 
     hardship if required to comply with paragraph (2), the 
     Administrator shall extend the exemption under clause (i) for 
     the small refinery for a period of not less than 2 additional 
     years.

       ``(B) Petitions based on disproportionate economic 
     hardship.--
       ``(i) Extension of exemption.--A small refinery may at any 
     time petition the Administrator for an extension of the 
     exemption under subparagraph (A) for the reason of 
     disproportionate economic hardship.
       ``(ii) Evaluation of petitions.--In evaluating a petition 
     under clause (i), the Administrator, in consultation with the 
     Secretary of Energy, shall consider the findings of the study 
     under subparagraph (A)(ii) and other economic factors.
       ``(iii) Deadline for action on petitions.--The 
     Administrator shall act on any petition submitted by a small 
     refinery for a hardship exemption not later than 90 days 
     after the date of receipt of the petition.
       ``(C) Credit program.--If a small refinery notifies the 
     Administrator that the small refinery waives the exemption 
     under subparagraph (A), the regulations promulgated under 
     paragraph (2)(A) shall provide for the generation of credits 
     by the small refinery under paragraph (5) beginning in the 
     calendar year following the date of notification.
       ``(D) Opt-in for small refineries.--A small refinery shall 
     be subject to the requirements of paragraph (2) if the small 
     refinery notifies the Administrator that the small refinery 
     waives the exemption under subparagraph (A).
       ``(10) Ethanol market concentration analysis.--
       ``(A) Analysis.--
       ``(i) In general.--Not later than 180 days after the date 
     of enactment of this paragraph, and annually thereafter, the 
     Federal Trade Commission shall perform a market concentration 
     analysis of the ethanol production industry using the 
     Herfindahl-Hirschman Index to determine whether there is 
     sufficient competition among industry participants to avoid 
     price-setting and other anticompetitive behavior.
       ``(ii) Scoring.--For the purpose of scoring under clause 
     (i) using the Herfindahl-Hirschman Index, all marketing 
     arrangements among industry participants shall be considered.
       ``(B) Report.--Not later than December 1, 2005, and 
     annually thereafter, the Federal Trade Commission shall 
     submit to Congress and the Administrator a report on the 
     results of the market concentration analysis performed under 
     subparagraph (A)(i).''.
       (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)''.
       (c) Exclusion From Ethanol Waiver.--Section 211(h) of the 
     Clean Air Act (42 U.S.C. 7545(h)) is amended--
       (1) by redesignating paragraph (5) as paragraph (6); and
       (2) by inserting after paragraph (4) the following:
       ``(5) Exclusion from ethanol waiver.--
       ``(A) Promulgation of regulations.--Upon notification, 
     accompanied by supporting documentation, from the Governor of 
     a State that the Reid vapor pressure limitation established 
     by paragraph (4) will increase emissions that contribute to 
     air pollution in any area in the State, the Administrator 
     shall, by regulation, apply, in lieu of the Reid vapor 
     pressure limitation established by paragraph (4), the Reid 
     vapor pressure limitation established by paragraph (1) to all 
     fuel blends containing gasoline and 10 percent denatured 
     anhydrous ethanol that are sold, offered for sale, dispensed, 
     supplied, offered for supply, transported, or introduced into 
     commerce in the area during the high ozone season.
       ``(B) Deadline for promulgation.--The Administrator shall 
     promulgate regulations under subparagraph (A) not later than 
     90 days after the date of receipt of a notification from a 
     Governor under that subparagraph.
       ``(C) Effective date.--
       ``(i) In general.--With respect to an area in a State for 
     which the Governor submits a notification under subparagraph 
     (A), the regulations under that subparagraph shall take 
     effect on the later of--

       ``(I) the first day of the first high ozone season for the 
     area that begins after the date of receipt of the 
     notification; or
       ``(II) 1 year after the date of receipt of the 
     notification.

       ``(ii) Extension of effective date based on determination 
     of insufficient supply.--

       ``(I) In general.--If, after receipt of a notification with 
     respect to an area from a Governor of a State under 
     subparagraph (A), the Administrator determines, on the 
     Administrator's own motion or on petition of any person and 
     after consultation with the Secretary of Energy, that the 
     promulgation of regulations described in subparagraph (A) 
     would result in an insufficient supply of gasoline in the 
     State, the Administrator, by regulation--

       ``(aa) shall extend the effective date of the regulations 
     under clause (i) with respect to the area for not more than 1 
     year; and
       ``(bb) may renew the extension under item (aa) for 2 
     additional periods, each of which shall not exceed 1 year.

       ``(II) Deadline for action on petitions.--The Administrator 
     shall act on any petition submitted under subclause (I) not 
     later than 180 days after the date of receipt of the 
     petition.''.

       (d) Survey of Renewable Fuel Market.--
       (1) Survey and report.--Not later than December 1, 2006, 
     and annually thereafter, the Administrator of the 
     Environmental Protection Agency (in consultation with the 
     Secretary acting through the Administrator of the Energy 
     Information Administration) shall--
       (A) conduct, with respect to each conventional gasoline use 
     area and each reformulated gasoline use area in each State, a 
     survey to determine the market shares of--
       (i) conventional gasoline containing ethanol;
       (ii) reformulated gasoline containing ethanol;
       (iii) conventional gasoline containing renewable fuel; and
       (iv) reformulated gasoline containing renewable fuel; and
       (B) submit to Congress, and make publicly available, a 
     report on the results of the survey under subparagraph (A).
       (2) Recordkeeping and reporting requirements.--The 
     Administrator of the Environmental Protection Agency 
     (hereinafter in this subsection referred to as the 
     ``Administrator'') may require any refiner, blender, or 
     importer to keep such records and make such reports as are 
     necessary to ensure that the survey conducted under paragraph 
     (1) is accurate. The Administrator, to avoid duplicative 
     requirements, shall rely, to the extent practicable, on 
     existing reporting and recordkeeping requirements and other 
     information available to the Administrator including gasoline 
     distribution patterns that include multistate use areas.
       (3) Applicable law.--Activities carried out under this 
     subsection shall be conducted in a manner designed to protect 
     confidentiality of individual responses.

     SEC. 1502. FINDINGS.

       Congress finds that--
       (1) since 1979, methyl tertiary butyl ether (hereinafter in 
     this section referred to as ``MTBE'') has been used 
     nationwide at low levels in gasoline to replace lead as an 
     octane booster or anti-knocking agent;
       (2) Public Law 101-549 (commonly known as the ``Clean Air 
     Act Amendments of 1990'') (42 U.S.C. 7401 et seq.) 
     established a fuel oxygenate standard under which 
     reformulated gasoline must contain at least 2 percent oxygen 
     by weight; and
       (3) the fuel industry responded to the fuel oxygenate 
     standard established by Public Law 101-549 by making 
     substantial investments in--
       (A) MTBE production capacity; and
       (B) systems to deliver MTBE-containing gasoline to the 
     marketplace.

     SEC. 1503. CLAIMS FILED AFTER ENACTMENT.

       Claims and legal actions filed after the date of enactment 
     of this Act related to allegations involving actual or 
     threatened contamination of methyl tertiary butyl ether 
     (MTBE) may be removed to the appropriate United States 
     district court.

     SEC. 1504. ELIMINATION OF OXYGEN CONTENT REQUIREMENT FOR 
                   REFORMULATED GASOLINE.

       (a) Elimination.--
       (1) In general.--Section 211(k) of the Clean Air Act (42 
     U.S.C. 7545(k)) is amended--
       (A) in paragraph (2)--
       (i) in the second sentence of subparagraph (A), by striking 
     ``(including the oxygen content requirement contained in 
     subparagraph (B))'';
       (ii) by striking subparagraph (B); and
       (iii) by redesignating subparagraphs (C) and (D) as 
     subparagraphs (B) and (C), respectively;
       (B) in paragraph (3)(A), by striking clause (v); and
       (C) in paragraph (7)--
       (i) in subparagraph (A)--

       (I) by striking clause (i); and
       (II) by redesignating clauses (ii) and (iii) as clauses (i) 
     and (ii), respectively; and

       (ii) in subparagraph (C)--

       (I) by striking clause (ii); and
       (II) by redesignating clause (iii) as clause (ii).

       (2) Applicability.--The amendments made by paragraph (1) 
     apply--
       (A) in the case of a State that has received a waiver under 
     section 209(b) of the Clean Air Act (42 U.S.C. 7543(b)), 
     beginning on the date of enactment of this Act; and
       (B) in the case of any other State, beginning 270 days 
     after the date of enactment of this Act.
       (b) Maintenance of Toxic Air Pollutant Emission 
     Reductions.--Section 211(k)(1) of the Clean Air Act (42 
     U.S.C. 7545(k)(1)) is amended--

[[Page 17925]]

       (1) 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
       (2) by adding at the end the following:
       ``(B) Maintenance of toxic air pollutant emissions 
     reductions from reformulated gasoline.--
       ``(i) Definition of padd.--In this subparagraph the term 
     `PADD' means a Petroleum Administration for Defense District.
       ``(ii) Regulations concerning emissions of toxic air 
     pollutants.--Not later than 270 days after the date of 
     enactment of this subparagraph, the Administrator shall 
     establish by regulation, for each refinery or importer (other 
     than a refiner or importer in a State that has received a 
     waiver under section 209(b) with respect to gasoline produced 
     for use in that State), standards for toxic air pollutants 
     from use of the reformulated gasoline produced or distributed 
     by the refiner or importer that maintain the reduction of the 
     average annual aggregate emissions of toxic air pollutants 
     for reformulated gasoline produced or distributed by the 
     refiner or importer during calendar years 2001 and 2002 (as 
     determined on the basis of data collected by the 
     Administrator with respect to the refiner or importer).
       ``(iii) Standards applicable to specific refineries or 
     importers.--

       ``(I) Applicability of standards.--For any calendar year, 
     the standards applicable to a refiner or importer under 
     clause (ii) shall apply to the quantity of gasoline produced 
     or distributed by the refiner or importer in the calendar 
     year only to the extent that the quantity is less than or 
     equal to the average annual quantity of reformulated gasoline 
     produced or distributed by the refiner or importer during 
     calendar years 2001 and 2002.

       ``(II) Applicability of other standards.--For any calendar 
     year, the quantity of gasoline produced or distributed by a 
     refiner or importer that is in excess of the quantity subject 
     to subclause (I) shall be subject to standards for emissions 
     of toxic air pollutants promulgated under subparagraph (A) 
     and paragraph (3)(B).

       ``(iv) Credit program.--The Administrator shall provide for 
     the granting and use of credits for emissions of toxic air 
     pollutants in the same manner as provided in paragraph (7).
       ``(v) Regional protection of toxics reduction baselines.--

       ``(I) In general.--Not later than 60 days after the date of 
     enactment of this subparagraph, and not later than April 1 of 
     each calendar year that begins after that date of enactment, 
     the Administrator shall publish in the Federal Register a 
     report that specifies, with respect to the previous calendar 
     year--

       ``(aa) the quantity of reformulated gasoline produced that 
     is in excess of the average annual quantity of reformulated 
     gasoline produced in 2001 and 2002; and
       ``(bb) the reduction of the average annual aggregate 
     emissions of toxic air pollutants in each PADD, based on 
     retail survey data or data from other appropriate sources.

       ``(II) Effect of failure to maintain aggregate toxics 
     reductions.--If, in any calendar year, the reduction of the 
     average annual aggregate emissions of toxic air pollutants in 
     a PADD fails to meet or exceed the reduction of the average 
     annual aggregate emissions of toxic air pollutants in the 
     PADD in calendar years 2001 and 2002, the Administrator, not 
     later than 90 days after the date of publication of the 
     report for the calendar year under subclause (I), shall--

       ``(aa) identify, to the maximum extent practicable, the 
     reasons for the failure, including the sources, volumes, and 
     characteristics of reformulated gasoline that contributed to 
     the failure; and
       ``(bb) promulgate revisions to the regulations promulgated 
     under clause (ii), to take effect not earlier than 180 days 
     but not later than 270 days after the date of promulgation, 
     to provide that, notwithstanding clause (iii)(II), all 
     reformulated gasoline produced or distributed at each refiner 
     or importer shall meet the standards applicable under clause 
     (iii)(I) beginning not later than April 1 of the calendar 
     year following publication of the report under subclause (I) 
     and in each calendar year thereafter.
       ``(vi) Not later than July 1, 2007, the Administrator shall 
     promulgate final regulations to control hazardous air 
     pollutants from motor vehicles and motor vehicle fuels, as 
     provided for in section 80.1045 of title 40, Code of Federal 
     Regulations (as in effect on the date of enactment of this 
     subparagraph), and as authorized under section 202(1) of the 
     Clean Air Act. If the Administrator promulgates by such date, 
     final regulations to control hazardous air pollutants from 
     motor vehicles and motor vehicle fuels that achieve and 
     maintain greater overall reductions in emissions of air 
     toxics from reformulated gasoline than the reductions that 
     would be achieved under section 211(k)(1)(B) of the Clean Air 
     Act as amended by this clause, then sections 211(k)(1)(B)(i) 
     through 211(k)(1)(B)(v) shall be null and void and 
     regulations promulgated thereunder shall be rescinded and 
     have no further effect.''.
       (c) Consolidation in Reformulated Gasoline Regulations.--
     Not later than 180 days after the date of enactment of this 
     Act, the Administrator of the Environmental Protection Agency 
     shall revise the reformulated gasoline regulations under 
     subpart D of part 80 of title 40, Code of Federal 
     Regulations, to consolidate the regulations applicable to 
     VOC-Control Regions 1 and 2 under section 80.41 of that title 
     by eliminating the less stringent requirements applicable to 
     gasoline designated for VOC-Control Region 2 and instead 
     applying the more stringent requirements applicable to 
     gasoline designated for VOC-Control Region 1.
       (d) Savings Clause.--
       (1) In general.--Nothing in this section or any amendment 
     made by this section affects or prejudices any legal claim or 
     action with respect to regulations promulgated by the 
     Administrator before the date of enactment of this Act 
     regarding--
       (A) emissions of toxic air pollutants from motor vehicles; 
     or
       (B) the adjustment of standards applicable to a specific 
     refinery or importer made under those regulations.
       (2) Adjustment of standards.--
       (A) Applicability.--The Administrator may apply any 
     adjustments to the standards applicable to a refinery or 
     importer under subparagraph (B)(iii)(I) of section 211(k)(1) 
     of the Clean Air Act (as added by subsection (b)(2)), except 
     that--
       (i) the Administrator shall revise the adjustments to be 
     based only on calendar years 1999 and 2000;
       (ii) any such adjustment shall not be made at a level below 
     the average percentage of reductions of emissions of toxic 
     air pollutants for reformulated gasoline supplied to PADD I 
     during calendar years 1999 and 2000; and
       (iii) in the case of an adjustment based on toxic air 
     pollutant emissions from reformulated gasoline significantly 
     below the national annual average emissions of toxic air 
     pollutants from all reformulated gasoline--

       (I) the Administrator may revise the adjustment to take 
     account of the scope of the prohibition on methyl tertiary 
     butyl ether imposed by a State; and
       (II) any such adjustment shall require the refiner or 
     importer, to the maximum extent practicable, to maintain the 
     reduction achieved during calendar years 1999 and 2000 in the 
     average annual aggregate emissions of toxic air pollutants 
     from reformulated gasoline produced or distributed by the 
     refiner or importer.

     SEC. 1505. PUBLIC HEALTH AND ENVIRONMENTAL IMPACTS OF FUELS 
                   AND FUEL ADDITIVES.

       Section 211(b) of the Clean Air Act (42 U.S.C. 7545(b)) is 
     amended--
       (1) in paragraph (2)--
       (A) by striking ``may also'' and inserting ``shall, on a 
     regular basis,''; and
       (B) by striking subparagraph (A) and inserting the 
     following:
       ``(A) to conduct tests to determine potential public health 
     and environmental effects of the fuel or additive (including 
     carcinogenic, teratogenic, or mutagenic effects); and''; and
       (2) by adding at the end the following:
       ``(4) Study on certain fuel additives and blendstocks.--
       ``(A) In general.--Not later than 2 years after the date of 
     enactment of this paragraph, the Administrator shall--
       ``(i) conduct a study on the effects on public health 
     (including the effects on children, pregnant women, minority 
     or low-income communities, and other sensitive populations), 
     air quality, and water resources of increased use of, and the 
     feasibility of using as substitutes for methyl tertiary butyl 
     ether in gasoline--

       ``(I) ethyl tertiary butyl ether;
       ``(II) tertiary amyl methyl ether;
       ``(III) di-isopropyl ether;
       ``(IV) tertiary butyl alcohol;
       ``(V) other ethers and heavy alcohols, as determined by 
     then Administrator;
       ``(VI) ethanol;
       ``(VII) iso-octane; and
       ``(VIII) alkylates; and

       ``(ii) conduct a study on the effects on public health 
     (including the effects on children, pregnant women, minority 
     or low-income communities, and other sensitive populations), 
     air quality, and water resources of the adjustment for 
     ethanol-blended reformulated gasoline to the volatile organic 
     compounds performance requirements that are applicable under 
     paragraphs (1) and (3) of section 211(k); and
       ``(iii) submit to the Committee on Environment and Public 
     Works of the Senate and the Committee on Energy and Commerce 
     of the House of Representatives a report describing the 
     results of the studies under clauses (i) and (ii).
       ``(B) Contracts for study.--In carrying out this paragraph, 
     the Administrator may enter into 1 or more contracts with 
     nongovernmental entities such as--
       ``(i) the national energy laboratories; and
       ``(ii) institutions of higher education (as defined in 
     section 101 of the Higher Education Act of 1965 (20 U.S.C. 
     1001)).''.

     SEC. 1506. ANALYSES OF MOTOR VEHICLE FUEL CHANGES.

       Section 211 of the Clean Air Act (42 U.S.C. 7545) is 
     amended by inserting after subsection (p) the following:
       ``(q) Analyses of Motor Vehicle Fuel Changes and Emissions 
     Model.--
       ``(1) Anti-backsliding analysis.--
       ``(A) Draft analysis.--Not later than 4 years after the 
     date of enactment of this paragraph, the Administrator shall 
     publish for public comment a draft analysis of the changes in 
     emissions of air pollutants and air quality due to the use of 
     motor vehicle fuel and fuel additives resulting from 
     implementation of the amendments made by the Energy Policy 
     Act of 2005.
       ``(B) Final analysis.--After providing a reasonable 
     opportunity for comment but not later than 5 years after the 
     date of enactment of this paragraph, the Administrator shall 
     publish the analysis in final form.

[[Page 17926]]

       ``(2) Emissions model.--For the purposes of this section, 
     not later than 4 years after the date of enactment of this 
     paragraph, the Administrator shall develop and finalize an 
     emissions model that reflects, to the maximum extent 
     practicable, the effects of gasoline characteristics or 
     components on emissions from vehicles in the motor vehicle 
     fleet during calendar year 2007.
       ``(3) Permeation effects study.--
       ``(A) In general.--Not later than 1 year after the date of 
     enactment of this paragraph, the Administrator shall conduct 
     a study, and report to Congress the results of the study, on 
     the effects of ethanol content in gasoline on permeation, the 
     process by which fuel molecules migrate through the 
     elastomeric materials (rubber and plastic parts) that make up 
     the fuel and fuel vapor systems of a motor vehicle.
       ``(B) Evaporative emissions.--The study shall include 
     estimates of the increase in total evaporative emissions 
     likely to result from the use of gasoline with ethanol 
     content in a motor vehicle, and the fleet of motor vehicles, 
     due to permeation.''.

     SEC. 1507. 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 redesignated by paragraph 
     (2))--
       (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) Ozone transport region.--
       ``(i) Application of prohibition.--

       ``(I) In general.--On application of the Governor of a 
     State in the ozone transport region established by section 
     184(a), the Administrator, not later than 180 days after the 
     date of receipt of the application, shall apply the 
     prohibition specified in paragraph (5) to any area in the 
     State (other than an area classified as a marginal, moderate, 
     serious, or severe ozone nonattainment area under subpart 2 
     of part D of title I) unless the Administrator determines 
     under clause (iii) that there is insufficient capacity to 
     supply reformulated gasoline.
       ``(II) Publication of application.--As soon as practicable 
     after the date of receipt of an application under subclause 
     (I), the Administrator shall publish the application in the 
     Federal Register.

       ``(ii) Period of applicability.--Under clause (i), the 
     prohibition specified in paragraph (5) shall apply in a 
     State--

       ``(I) commencing as soon as practicable but not later than 
     2 years after the date of approval by the Administrator of 
     the application of the Governor of the State; and
       ``(II) ending not earlier than 4 years after the 
     commencement date determined under subclause (I).

       ``(iii) Extension of commencement date based on 
     insufficient capacity.--

       ``(I) In general.--If, after receipt of an application from 
     a Governor of a State under clause (i), the Administrator 
     determines, on the Administrator's own motion or on petition 
     of any person, after consultation with the Secretary of 
     Energy, that there is insufficient capacity to supply 
     reformulated gasoline, the Administrator, by regulation--

       ``(aa) shall extend the commencement date with respect to 
     the State under clause (ii)(I) for not more than 1 year; and
       ``(bb) may renew the extension under item (aa) for 2 
     additional periods, each of which shall not exceed 1 year.

       ``(II) Deadline for action on petitions.--The Administrator 
     shall act on any petition submitted under subclause (I) not 
     later than 180 days after the date of receipt of the 
     petition.''.

     SEC. 1508. DATA COLLECTION.

       Section 205 of the Department of Energy Organization Act 
     (42 U.S.C. 7135) is amended by adding at the end the 
     following:
       ``(m) Renewable Fuels Survey.--(1) In order to improve the 
     ability to evaluate the effectiveness of the Nation's 
     renewable fuels mandate, the Administrator shall conduct and 
     publish the results of a survey of renewable fuels demand in 
     the motor vehicle fuels market in the United States monthly, 
     and in a manner designed to protect the confidentiality of 
     individual responses. In conducting the survey, the 
     Administrator shall collect information both on a national 
     and regional basis, including each of the following:
       ``(A) The quantity of renewable fuels produced.
       ``(B) The quantity of renewable fuels blended.
       ``(C) The quantity of renewable fuels imported.
       ``(D) The quantity of renewable fuels demanded.
       ``(E) Market price data.
       ``(F) Such other analyses or evaluations as the 
     Administrator finds are necessary to achieve the purposes of 
     this section.
       ``(2) The Administrator shall also collect or estimate 
     information both on a national and regional basis, pursuant 
     to subparagraphs (A) through (F) of paragraph (1), for the 5 
     years prior to implementation of this subsection.
       ``(3) This subsection does not affect the authority of the 
     Administrator to collect data under section 52 of the Federal 
     Energy Administration Act of 1974 (15 U.S.C. 790a).''.

     SEC. 1509. FUEL SYSTEM REQUIREMENTS HARMONIZATION STUDY.

       (a) Study.--
       (1) In general.--The Administrator of the Environmental 
     Protection Agency and the Secretary shall jointly conduct a 
     study of Federal, State, and local requirements concerning 
     motor vehicle fuels, including--
       (A) requirements relating to reformulated gasoline, 
     volatility (measured in Reid vapor pressure), oxygenated 
     fuel, and diesel fuel; and
       (B) other requirements that vary from State to State, 
     region to region, or locality to locality.
       (2) Required elements.--The study shall assess--
       (A) the effect of the variety of requirements described in 
     paragraph (1) on the supply, quality, and price of motor 
     vehicle fuels available to the consumer;
       (B) the effect of the requirements described in paragraph 
     (1) on achievement of--
       (i) national, regional, and local air quality standards and 
     goals; and
       (ii) related environmental and public health protection 
     standards and goals (including the protection of children, 
     pregnant women, minority or low-income communities, and other 
     sensitive populations);
       (C) the effect of Federal, State, and local motor vehicle 
     fuel regulations, including multiple motor vehicle fuel 
     requirements, on--
       (i) domestic refiners;
       (ii) the fuel distribution system; and
       (iii) industry investment in new capacity;
       (D) the effect of the requirements described in paragraph 
     (1) on emissions from vehicles, refiners, and fuel handling 
     facilities;
       (E) the feasibility of developing national or regional 
     motor vehicle fuel slates for the 48 contiguous States that, 
     while protecting and improving air quality at the national, 
     regional, and local levels, could--
       (i) enhance flexibility in the fuel distribution 
     infrastructure and improve fuel fungibility;
       (ii) reduce price volatility and costs to consumers and 
     producers;
       (iii) provide increased liquidity to the gasoline market; 
     and
       (iv) enhance fuel quality, consistency, and supply;
       (F) the feasibility of providing incentives, and the need 
     for the development of national standards necessary, to 
     promote cleaner burning motor vehicle fuel; and
       (G) the extent to which improvements in air quality and any 
     increases or decreases in the price of motor fuel can be 
     projected to result from the Environmental Protection 
     Agency's Tier II requirements for conventional gasoline and 
     vehicle emission systems, on-road and off-road diesel rules, 
     the reformulated gasoline program, the renewable content 
     requirements established by this subtitle, State programs 
     regarding gasoline volatility, and any other requirements 
     imposed by the Federal Government, States or localities 
     affecting the composition of motor fuel.
       (b) Report.--
       (1) In general.--Not later than June 1, 2008, the 
     Administrator of the Environmental Protection Agency and the 
     Secretary shall submit to Congress a report on the results of 
     the study conducted under subsection (a).
       (2) Recommendations.--
       (A) In general.--The report shall contain recommendations 
     for legislative and administrative actions that may be 
     taken--
       (i) to improve air quality;
       (ii) to reduce costs to consumers and producers; and
       (iii) to increase supply liquidity.
       (B) Required considerations.--The recommendations under 
     subparagraph (A) shall take into account the need to provide 
     advance notice of required modifications to refinery and fuel 
     distribution systems in order to ensure an adequate supply of 
     motor vehicle fuel in all States.
       (3) Consultation.--In developing the report, the 
     Administrator of the Environmental Protection Agency and the 
     Secretary shall consult with--
       (A) the Governors of the States;
       (B) automobile manufacturers;
       (C) State and local air pollution control regulators;
       (D) public health experts;
       (E) motor vehicle fuel producers and distributors; and
       (F) the public.

     SEC. 1510. COMMERCIAL BYPRODUCTS FROM MUNICIPAL SOLID WASTE 
                   AND CELLULOSIC BIOMASS LOAN GUARANTEE PROGRAM.

       (a) Definition of Municipal Solid Waste.--In this section, 
     the term ``municipal solid waste'' has the meaning given the 
     term ``solid waste'' in section 1004 of the Solid Waste 
     Disposal Act (42 U.S.C. 6903).
       (b) Establishment of Program.--The Secretary shall 
     establish a program to provide guarantees of loans by private 
     institutions for the construction of facilities for the 
     processing and conversion of municipal solid waste and 
     cellulosic biomass into fuel ethanol and other commercial 
     byproducts.
       (c) Requirements.--The Secretary may provide a loan 
     guarantee under subsection (b) to an applicant if--
       (1) without a loan guarantee, credit is not available to 
     the applicant under reasonable terms or conditions sufficient 
     to finance the construction of a facility described in 
     subsection (b);

[[Page 17927]]

       (2) the prospective earning power of the applicant and the 
     character and value of the security pledged provide a 
     reasonable assurance of repayment of the loan to be 
     guaranteed in accordance with the terms of the loan; and
       (3) the loan bears interest at a rate determined by the 
     Secretary to be reasonable, taking into account the current 
     average yield on outstanding obligations of the United States 
     with remaining periods of maturity comparable to the maturity 
     of the loan.
       (d) Criteria.--In selecting recipients of loan guarantees 
     from among applicants, the Secretary shall give preference to 
     proposals that--
       (1) meet all applicable Federal and State permitting 
     requirements;
       (2) are most likely to be successful; and
       (3) are located in local markets that have the greatest 
     need for the facility because of--
       (A) the limited availability of land for waste disposal;
       (B) the availability of sufficient quantities of cellulosic 
     biomass; or
       (C) a high level of demand for fuel ethanol or other 
     commercial byproducts of the facility.
       (e) Maturity.--A loan guaranteed under subsection (b) shall 
     have a maturity of not more than 20 years.
       (f) Terms and Conditions.--The loan agreement for a loan 
     guaranteed under subsection (b) shall provide that no 
     provision of the loan agreement may be amended or waived 
     without the consent of the Secretary.
       (g) Assurance of Repayment.--The Secretary shall require 
     that an applicant for a loan guarantee under subsection (b) 
     provide an assurance of repayment in the form of a 
     performance bond, insurance, collateral, or other means 
     acceptable to the Secretary in an amount equal to not less 
     than 20 percent of the amount of the loan.
       (h) Guarantee Fee.--The recipient of a loan guarantee under 
     subsection (b) shall pay the Secretary an amount determined 
     by the Secretary to be sufficient to cover the administrative 
     costs of the Secretary relating to the loan guarantee.
       (i) Full Faith and Credit.--The full faith and credit of 
     the United States is pledged to the payment of all guarantees 
     made under this section. Any such guarantee made by the 
     Secretary shall be conclusive evidence of the eligibility of 
     the loan for the guarantee with respect to principal and 
     interest. The validity of the guarantee shall be 
     incontestable in the hands of a holder of the guaranteed 
     loan.
       (j) Reports.--Until each guaranteed loan under this section 
     has been repaid in full, the Secretary shall annually submit 
     to Congress a report on the activities of the Secretary under 
     this section.
       (k) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section.
       (l) Termination of Authority.--The authority of the 
     Secretary to issue a loan guarantee under subsection (b) 
     terminates on the date that is 10 years after the date of 
     enactment of this Act.

     SEC. 1511. RENEWABLE FUEL.

       
       The Clean Air Act is amended by inserting after section 211 
     (42 U.S.C. 7411) the following:

     ``SEC. 212. RENEWABLE FUEL.

       ``(a) Definitions.--In this section:
       ``(1) Municipal solid waste.--The term `municipal solid 
     waste' has the meaning given the term `solid waste' in 
     section 1004 of the Solid Waste Disposal Act (42 U.S.C. 
     6903).
       ``(2) RFG state.--The term `RFG State' means a State in 
     which is located 1 or more covered areas (as defined in 
     section 211(k)(10)(D)).
       ``(3) Secretary.--The term `Secretary' means the Secretary 
     of Energy.
       ``(b) Cellulosic Biomass Ethanol and Municipal Solid Waste 
     Loan Guarantee Program.--
       ``(1) In general.--Funds may be provided for the cost (as 
     defined in the Federal Credit Reform Act of 1990 (2 U.S.C. 
     661 et seq.)) of loan guarantees issued under title XIV of 
     the Energy Policy Act to carry out commercial demonstration 
     projects for celluosic biomass and sucrose-derived ethanol.
       ``(2) Demonstration projects.--
       ``(A) In general.--The Secretary shall issue loan 
     guarantees under this section to carry out not more than 4 
     projects to commercially demonstrate the feasibility and 
     viability of producing cellulosic biomass ethanol or sucrose-
     derived ethanol, including at least 1 project that uses 
     cereal straw as a feedstock and 1 project that uses municipal 
     solid waste as a feedstock.
       ``(B) Design capacity.--Each project shall have a design 
     capacity to produce at least 30,000,000 gallons of cellulosic 
     biomass ethanol each year.
       ``(3) Applicant assurances.--An applicant for a loan 
     guarantee under this section shall provide assurances, 
     satisfactory to the Secretary, that--
       ``(A) the project design has been validated through the 
     operation of a continuous process facility with a cumulative 
     output of at least 50,000 gallons of ethanol;
       ``(B) the project has been subject to a full technical 
     review;
       ``(C) the project is covered by adequate project 
     performance guarantees;
       ``(D) the project, with the loan guarantee, is economically 
     viable; and
       ``(E) there is a reasonable assurance of repayment of the 
     guaranteed loan.
       ``(4) Limitations.--
       ``(A) Maximum guarantee.--Except as provided in 
     subparagraph (B), a loan guarantee under this section may be 
     issued for up to 80 percent of the estimated cost of a 
     project, but may not exceed $250,000,000 for a project.
       ``(B) Additional guarantees.--
       ``(i) In general.--The Secretary may issue additional loan 
     guarantees for a project to cover up to 80 percent of the 
     excess of actual project cost over estimated project cost but 
     not to exceed 15 percent of the amount of the original 
     guarantee.
       ``(ii) Principal and interest.--Subject to subparagraph 
     (A), the Secretary shall guarantee 100 percent of the 
     principal and interest of a loan made under subparagraph (A).
       ``(5) Equity contributions.--To be eligible for a loan 
     guarantee under this section, an applicant for the loan 
     guarantee shall have binding commitments from equity 
     investors to provide an initial equity contribution of at 
     least 20 percent of the total project cost.
       ``(6) Insufficient amounts.--If the amount made available 
     to carry out this section is insufficient to allow the 
     Secretary to make loan guarantees for 3 projects described in 
     subsection (b), the Secretary shall issue loan guarantees for 
     1 or more qualifying projects under this section in the order 
     in which the applications for the projects are received by 
     the Secretary.
       ``(7) Approval.--An application for a loan guarantee under 
     this section shall be approved or disapproved by the 
     Secretary not later than 90 days after the application is 
     received by the Secretary.
       ``(c) Authorization of Appropriations for Resource 
     Center.--There is authorized to be appropriated, for a 
     resource center to further develop bioconversion technology 
     using low-cost biomass for the production of ethanol at the 
     Center for Biomass-Based Energy at the Mississippi State 
     University and the Oklahoma State University, $4,000,000 for 
     each of fiscal years 2005 through 2007.
       ``(d) Renewable Fuel Production Research and Development 
     Grants.--
       ``(1) In general.--The Administrator shall provide grants 
     for the research into, and development and implementation of, 
     renewable fuel production technologies in RFG States with low 
     rates of ethanol production, including low rates of 
     production of cellulosic biomass ethanol.
       ``(2) Eligibility.--
       ``(A) In general.--The entities eligible to receive a grant 
     under this subsection are academic institutions in RFG 
     States, and consortia made up of combinations of academic 
     institutions, industry, State government agencies, or local 
     government agencies in RFG States, that have proven 
     experience and capabilities with relevant technologies.
       ``(B) Application.--To be eligible to receive a grant under 
     this subsection, an eligible entity shall submit to the 
     Administrator an application in such manner and form, and 
     accompanied by such information, as the Administrator may 
     specify.
       ``(3) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this subsection $25,000,000 
     for each of fiscal years 2006 through 2010.
       ``(e) Cellulosic Biomass Ethanol Conversion Assistance.--
       ``(1) In general.--The Secretary may provide grants to 
     merchant producers of cellulosic biomass ethanol in the 
     United States to assist the producers in building eligible 
     production facilities described in paragraph (2) for the 
     production of cellulosic biomass ethanol.
       ``(2) Eligible production facilities.--A production 
     facility shall be eligible to receive a grant under this 
     subsection if the production facility--
       ``(A) is located in the United States; and
       ``(B) uses cellulosic biomass feedstocks derived from 
     agricultural residues or municipal solid waste.
       ``(3) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this subsection--
       ``(A) $250,000,000 for fiscal year 2006; and
       ``(B) $400,000,000 for fiscal year 2007.''.

     SEC. 1512. CONVERSION ASSISTANCE FOR CELLULOSIC BIOMASS, 
                   WASTE-DERIVED ETHANOL, APPROVED RENEWABLE 
                   FUELS.

       Section 211 of the Clean Air Act (42 U.S.C. 7545) is 
     amended by adding at the end the following:
       ``(r) Conversion Assistance for Cellulosic Biomass, Waste-
     Derived Ethanol, Approved Renewable Fuels.--
       ``(1) In general.--The Secretary of Energy may provide 
     grants to merchant producers of cellulosic biomass ethanol, 
     waste-derived ethanol, and approved renewable fuels in the 
     United States to assist the producers in building eligible 
     production facilities described in paragraph (2) for the 
     production of ethanol or approved renewable fuels.
       ``(2) Eligible production facilities.--A production 
     facility shall be eligible to receive a grant under this 
     subsection if the production facility--
       ``(A) is located in the United States; and
       ``(B) uses cellulosic or renewable biomass or waste-derived 
     feedstocks derived from agricultural residues, wood residues, 
     municipal solid waste, or agricultural byproducts.
       ``(3) Authorization of appropriations.--There are 
     authorized to be appropriated the following amounts to carry 
     out this subsection:
       ``(A) $100,000,000 for fiscal year 2006.
       ``(B) $250,000,000 for fiscal year 2007.
       ``(C) $400,000,000 for fiscal year 2008.
       ``(4) Definitions.--For the purposes of this subsection:
       ``(A) The term `approved renewable fuels' are fuels and 
     components of fuels that have been

[[Page 17928]]

     approved by the Department of Energy, as defined in section 
     301 of the Energy Policy Act of 1992 (42 U.S.C. 13211), which 
     have been made from renewable biomass.
       ``(B) The term `renewable biomass' is, as defined in 
     Presidential Executive Order 13134, published in the Federal 
     Register on August 16, 1999, any organic matter that is 
     available on a renewable or recurring basis (excluding old-
     growth timber), including dedicated energy crops and trees, 
     agricultural food and feed crop residues, aquatic plants, 
     animal wastes, wood and wood residues, paper and paper 
     residues, and other vegetative waste materials. Old-growth 
     timber means timber of a forest from the late successional 
     stage of forest development.''.

     SEC. 1513. BLENDING OF COMPLIANT REFORMULATED GASOLINES.

       Section 211 of the Clean Air Act (42 U.S.C. 7545) is 
     amended by adding at the end the following:
       ``(s) Blending of Compliant Reformulated Gasolines.--
       ``(1) In general.--Notwithstanding subsections (h) and (k) 
     and subject to the limitations in paragraph (2) of this 
     subsection, it shall not be a violation of this subtitle for 
     a gasoline retailer, during any month of the year, to blend 
     at a retail location batches of ethanol-blended and non-
     ethanol-blended reformulated gasoline, provided that--
       ``(A) each batch of gasoline to be blended has been 
     individually certified as in compliance with subsections (h) 
     and (k) prior to being blended;
       ``(B) the retailer notifies the Administrator prior to such 
     blending, and identifies the exact location of the retail 
     station and the specific tank in which such blending will 
     take place;
       ``(C) the retailer retains and, as requested by the 
     Administrator or the Administrator's designee, makes 
     available for inspection such certifications accounting for 
     all gasoline at the retail outlet; and
       ``(D) the retailer does not, between June 1 and September 
     15 of each year, blend a batch of VOC-controlled, or 
     `summer', gasoline with a batch of non-VOC-controlled, or 
     `winter', gasoline (as these terms are defined under 
     subsections (h) and (k)).
       ``(2) Limitations.--
       ``(A) Frequency limitation.--A retailer shall only be 
     permitted to blend batches of compliant reformulated gasoline 
     under this subsection a maximum of two blending periods 
     between May 1 and September 15 of each calendar year.
       ``(B) Duration of blending period.--Each blending period 
     authorized under subparagraph (A) shall extend for a period 
     of no more than 10 consecutive calendar days.
       ``(3) Surveys.--A sample of gasoline taken from a retail 
     location that has blended gasoline within the past 30 days 
     and is in compliance with subparagraphs (A), (B), (C), and 
     (D) of paragraph (1) shall not be used in a VOC survey 
     mandated by 40 C.F.R. Part 80.
       ``(4) State implementation plans.--A State shall be held 
     harmless and shall not be required to revise its State 
     implementation plan under section 110 to account for the 
     emissions from blended gasoline authorized under paragraph 
     (1).
       ``(5) Preservation of state law.--Nothing in this 
     subsection shall--
       ``(A) preempt existing State laws or regulations regulating 
     the blending of compliant gasolines; or
       ``(B) prohibit a State from adopting such restrictions in 
     the future.
       ``(6) Regulations.--The Administrator shall promulgate, 
     after notice and comment, regulations implementing this 
     subsection within one year after the date of enactment of 
     this subsection.
       ``(7) Effective date.--This subsection shall become 
     effective 15 months after the date of its enactment and shall 
     apply to blended batches of reformulated gasoline on or after 
     that date, regardless of whether the implementing regulations 
     required by paragraph (6) have been promulgated by the 
     Administrator by that date.
       ``(8) Liability.--No person other than the person 
     responsible for blending under this subsection shall be 
     subject to an enforcement action or penalties under 
     subsection (d) solely arising from the blending of compliant 
     reformulated gasolines by the retailers.
       ``(9) Formulation of gasoline.--This subsection does not 
     grant authority to the Administrator or any State (or any 
     subdivision thereof) to require reformulation of gasoline at 
     the refinery to adjust for potential or actual emissions 
     increases due to the blending authorized by this 
     subsection.''.

     SEC. 1514. ADVANCED BIOFUEL TECHNOLOGIES PROGRAM.

       (a) In General.--Subject to the availability of 
     appropriations under subsection (d), the Administrator of the 
     Environmental Protection Agency shall, in consultation with 
     the Secretary of Agriculture and the Biomass Research and 
     Development Technical Advisory Committee established under 
     section 306 of the Biomass Research and Development Act of 
     2000 (Public Law 106-224; 7 U.S.C. 8101 note), establish a 
     program, to be known as the ``Advanced Biofuel Technologies 
     Program'', to demonstrate advanced technologies for the 
     production of alternative transportation fuels.
       (b) Priority.--In carrying out the program under subsection 
     (a), the Administrator shall give priority to projects that 
     enhance the geographical diversity of alternative fuels 
     production and utilize feedstocks that represent 10 percent 
     or less of ethanol or biodiesel fuel production in the United 
     States during the previous fiscal year.
       (c) Demonstration Projects.--
       (1) In general.--As part of the program under subsection 
     (a), the Administrator shall fund demonstration projects--
       (A) to develop not less than 4 different conversion 
     technologies for producing cellulosic biomass ethanol; and
       (B) to develop not less than 5 technologies for coproducing 
     value-added bioproducts (such as fertilizers, herbicides, and 
     pesticides) resulting from the production of biodiesel fuel.
       (2) Administration.--Demonstration projects under this 
     subsection shall be--
       (A) conducted based on a merit-reviewed, competitive 
     process; and
       (B) subject to the cost-sharing requirements of section 
     988.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section $110,000,000 for 
     each of fiscal years 2005 through 2009.

     SEC. 1515. WASTE-DERIVED ETHANOL AND BIODIESEL.

       Section 312(f)(1) of the Energy Policy Act of 1992 (42 
     U.S.C. 13220(f)(1)) is amended--
       (1) by striking ```biodiesel' means'' and inserting the 
     following: ```biodiesel'--
       ``(A) means''; and
       (2) in subparagraph (A) (as designated by paragraph (1)) by 
     striking ``and'' at the end and inserting the following:
       ``(B) includes biodiesel derived from--
       ``(i) animal wastes, including poultry fats and poultry 
     wastes, and other waste materials; or
       ``(ii) municipal solid waste and sludges and oils derived 
     from wastewater and the treatment of wastewater; and''.''

     SEC. 1516. SUGAR ETHANOL LOAN GUARANTEE PROGRAM.

       (a) In General.--Funds may be provided for the cost (as 
     defined in section 502 of the Federal Credit Reform Act of 
     1990 (2 U.S.C. 661a)) of loan guarantees issued under title 
     XIV to carry out commercial demonstration projects for 
     ethanol derived from sugarcane, bagasse, and other sugarcane 
     byproducts.
       (b) Demonstration Projects.--The Secretary may issue loan 
     guarantees under this section to projects to demonstrate 
     commercially the feasibility and viability of producing 
     ethanol using sugarcane, sugarcane bagasse, and other 
     sugarcane byproducts as a feedstock.
       (c) Requirements.--An applicant for a loan guarantee under 
     this section may provide assurances, satisfactory to the 
     Secretary, that--
       (1) the project design has been validated through the 
     operation of a continuous process facility;
       (2) the project has been subject to a full technical 
     review;
       (3) the project, with the loan guarantee, is economically 
     viable; and
       (4) there is a reasonable assurance of repayment of the 
     guaranteed loan.
       (d) Limitations.--
       (1) Maximum guarantee.--Except as provided in paragraph 
     (2), a loan guarantee under this section--
       (A) may be issued for up to 80 percent of the estimated 
     cost of a project; but
       (B) shall not exceed $50,000,000 for any 1 project.
       (2) Additional guarantees.--
       (A) In general.--The Secretary may issue additional loan 
     guarantees for a project to cover--
       (i) up to 80 percent of the excess of actual project costs; 
     but
       (ii) not to exceed 15 percent of the amount of the original 
     loan guarantee.
       (B) Principal and interest.--Subject to subparagraph (A), 
     the Secretary shall guarantee 100 percent of the principal 
     and interest of a loan guarantee made under subparagraph (A).
            Subtitle B--Underground Storage Tank Compliance

     SEC. 1521. SHORT TITLE.

       This subtitle may be cited as the ``Underground Storage 
     Tank Compliance Act ''.

     SEC. 1522. LEAKING UNDERGROUND STORAGE TANKS.

       (a) In General.--Section 9004 of the Solid Waste Disposal 
     Act (42 U.S.C. 6991c) is amended by adding at the end the 
     following:
       ``(f) Trust Fund Distribution.--
       ``(1) In general.--
       ``(A) Amount and permitted uses of distribution.--The 
     Administrator shall distribute to States not less than 80 
     percent of the funds from the Trust Fund that are made 
     available to the Administrator under section 9014(2)(A) for 
     each fiscal year for use in paying the reasonable costs, 
     incurred under a cooperative agreement with any State for--
       ``(i) corrective actions taken by the State under section 
     9003(h)(7)(A);
       ``(ii) necessary administrative expenses, as determined by 
     the Administrator, that are directly related to State fund or 
     State assurance programs under subsection (c)(1); or
       ``(iii) enforcement, by a State or a local government, of 
     State or local regulations pertaining to underground storage 
     tanks regulated under this subtitle.
       ``(B) Use of funds for enforcement.--In addition to the 
     uses of funds authorized under subparagraph (A), the 
     Administrator may use funds from the Trust Fund that are not 
     distributed to States under subparagraph (A) for enforcement 
     of any regulation promulgated by the Administrator under this 
     subtitle.
       ``(C) Prohibited uses.--Funds provided to a State by the 
     Administrator under subparagraph (A) shall not be used by the 
     State to provide financial assistance to an owner or operator 
     to meet any requirement relating to underground storage tanks 
     under subparts B, C, D, H, and G of part 280 of title 40, 
     Code of Federal Regulations (as in effect on the date of 
     enactment of this subsection).

[[Page 17929]]

       ``(2) Allocation.--
       ``(A) Process.--Subject to subparagraphs (B) and (C), in 
     the case of a State with which the Administrator has entered 
     into a cooperative agreement under section 9003(h)(7)(A), the 
     Administrator shall distribute funds from the Trust Fund to 
     the State using an allocation process developed by the 
     Administrator.
       ``(B) Diversion of state funds.--The Administrator shall 
     not distribute funds under subparagraph (A)(iii) of 
     subsection (f)(1) to any State that has diverted funds from a 
     State fund or State assurance program for purposes other than 
     those related to the regulation of underground storage tanks 
     covered by this subtitle, with the exception of those 
     transfers that had been completed earlier than the date of 
     enactment of this subsection.
       ``(C) Revisions to process.--The Administrator may revise 
     the allocation process referred to in subparagraph (A) 
     after--
       ``(i) consulting with State agencies responsible for 
     overseeing corrective action for releases from underground 
     storage tanks; and
       ``(ii) taking into consideration, at a minimum, each of the 
     following:

       ``(I) The number of confirmed releases from federally 
     regulated leaking underground storage tanks in the States.
       ``(II) The number of federally regulated underground 
     storage tanks in the States.
       ``(III) The performance of the States in implementing and 
     enforcing the program.
       ``(IV) The financial needs of the States.
       ``(V) The ability of the States to use the funds referred 
     to in subparagraph (A) in any year.

       ``(3) Distributions to state agencies.--Distributions from 
     the Trust Fund under this subsection shall be made directly 
     to a State agency that--
       ``(A) enters into a cooperative agreement referred to in 
     paragraph (2)(A); or
       ``(B) is enforcing a State program approved under this 
     section.''.
       (b) Withdrawal of Approval of State Funds.--Section 9004(c) 
     of the Solid Waste Disposal Act (42 U.S.C. 6991c(c)) is 
     amended by inserting the following new paragraph at the end 
     thereof:
       ``(6) Withdrawal of approval.--After an opportunity for 
     good faith, collaborative efforts to correct financial 
     deficiencies with a State fund, the Administrator may 
     withdraw approval of any State fund or State assurance 
     program to be used as a financial responsibility mechanism 
     without withdrawing approval of a State underground storage 
     tank program under section 9004(a).''.
       (c) Ability to Pay.--Section 9003(h)(6) of the Solid Waste 
     Disposal Act (42 U.S.C. 6591a(h)(6)) is amended by adding the 
     following new subparagraph at the end thereof:
       ``(E) Inability or limited ability to pay.--
       ``(i) In general.--In determining the level of recovery 
     effort, or amount that should be recovered, the Administrator 
     (or the State pursuant to paragraph (7)) shall consider the 
     owner or operator's ability to pay. An inability or limited 
     ability to pay corrective action costs must be demonstrated 
     to the Administrator (or the State pursuant to paragraph (7)) 
     by the owner or operator.
       ``(ii) Considerations.--In determining whether or not a 
     demonstration is made under clause (i), the Administrator (or 
     the State pursuant to paragraph (7)) shall take into 
     consideration the ability of the owner or operator to pay 
     corrective action costs and still maintain its basic business 
     operations, including consideration of the overall financial 
     condition of the owner or operator and demonstrable 
     constraints on the ability of the owner or operator to raise 
     revenues.
       ``(iii) Information.--An owner or operator requesting 
     consideration under this subparagraph shall promptly provide 
     the Administrator (or the State pursuant to paragraph (7)) 
     with all relevant information needed to determine the ability 
     of the owner or operator to pay corrective action costs.
       ``(iv) Alternative payment methods.--The Administrator (or 
     the State pursuant to paragraph (7)) shall consider 
     alternative payment methods as may be necessary or 
     appropriate if the Administrator (or the State pursuant to 
     paragraph (7)) determines that an owner or operator cannot 
     pay all or a portion of the costs in a lump sum payment.
       ``(v) Misrepresentation.--If an owner or operator provides 
     false information or otherwise misrepresents their financial 
     situation under clause (ii), the Administrator (or the State 
     pursuant to paragraph (7)) shall seek full recovery of the 
     costs of all such actions pursuant to the provisions of 
     subparagraph (A) without consideration of the factors in 
     subparagraph (B).''.

     SEC. 1523. INSPECTION OF UNDERGROUND STORAGE TANKS.

       (a) Inspection Requirements.--Section 9005 of the Solid 
     Waste Disposal Act (42 U.S.C. 6991d) is amended by inserting 
     the following new subsection at the end thereof:
       ``(c) Inspection Requirements.--
       ``(1) Uninspected tanks.--In the case of underground 
     storage tanks regulated under this subtitle that have not 
     undergone an inspection since December 22, 1998, not later 
     than 2 years after the date of enactment of this subsection, 
     the Administrator or a State that receives funding under this 
     subtitle, as appropriate, shall conduct on-site inspections 
     of all such tanks to determine compliance with this subtitle 
     and the regulations under this subtitle (40 C.F.R. 280) or a 
     requirement or standard of a State program developed under 
     section 9004.
       ``(2) Periodic inspections.--After completion of all 
     inspections required under paragraph (1), the Administrator 
     or a State that receives funding under this subtitle, as 
     appropriate, shall conduct on-site inspections of each 
     underground storage tank regulated under this subtitle at 
     least once every 3 years to determine compliance with this 
     subtitle and the regulations under this subtitle (40 C.F.R. 
     280) or a requirement or standard of a State program 
     developed under section 9004. The Administrator may extend 
     for up to one additional year the first 3-year inspection 
     interval under this paragraph if the State demonstrates that 
     it has insufficient resources to complete all such 
     inspections within the first 3-year period.
       ``(3) Inspection authority.--Nothing in this section shall 
     be construed to diminish the Administrator's or a State's 
     authorities under section 9005(a).''.
       (b) Study of Alternative Inspection Programs.--The 
     Administrator of the Environmental Protection Agency, in 
     coordination with a State, shall gather information on 
     compliance assurance programs that could serve as an 
     alternative to the inspection programs under section 9005(c) 
     of the Solid Waste Disposal Act (42 U.S.C. 6991d(c)) and 
     shall, within 4 years after the date of enactment of this 
     Act, submit a report to the Congress containing the results 
     of such study.

     SEC. 1524. OPERATOR TRAINING.

       (a) In General.--Section 9010 of the Solid Waste Disposal 
     Act (42 U.S.C. 6991i) is amended to read as follows:

     ``SEC. 9010. OPERATOR TRAINING.

       ``(a) Guidelines.--
       ``(1) In general.--Not later than 2 years after the date of 
     enactment of the Underground Storage Tank Compliance Act , in 
     consultation and cooperation with States and after public 
     notice and opportunity for comment, the Administrator shall 
     publish guidelines that specify training requirements for--
       ``(A) persons having primary responsibility for on-site 
     operation and maintenance of underground storage tank 
     systems;
       ``(B) persons having daily on-site responsibility for the 
     operation and maintenance of underground storage tanks 
     systems; and
       ``(C) daily, on-site employees having primary 
     responsibility for addressing emergencies presented by a 
     spill or release from an underground storage tank system.
       ``(2) Considerations.--The guidelines described in 
     paragraph (1) shall take into account--
       ``(A) State training programs in existence as of the date 
     of publication of the guidelines;
       ``(B) training programs that are being employed by tank 
     owners and tank operators as of the date of enactment of the 
     Underground Storage Tank Compliance Act ;
       ``(C) the high turnover rate of tank operators and other 
     personnel;
       ``(D) the frequency of improvement in underground storage 
     tank equipment technology;
       ``(E) the nature of the businesses in which the tank 
     operators are engaged;
       ``(F) the substantial differences in the scope and length 
     of training needed for the different classes of persons 
     described in subparagraphs (A), (B), and (C) of paragraph 
     (1); and
       ``(G) such other factors as the Administrator determines to 
     be necessary to carry out this section.
       ``(b) State Programs.--
       ``(1) In general.--Not later than 2 years after the date on 
     which the Administrator publishes the guidelines under 
     subsection (a)(1), each State that receives funding under 
     this subtitle shall develop State-specific training 
     requirements that are consistent with the guidelines 
     developed under subsection (a)(1).
       ``(2) Requirements.--State requirements described in 
     paragraph (1) shall--
       ``(A) be consistent with subsection (a);
       ``(B) be developed in cooperation with tank owners and tank 
     operators;
       ``(C) take into consideration training programs implemented 
     by tank owners and tank operators as of the date of enactment 
     of this section; and
       ``(D) be appropriately communicated to tank owners and 
     operators.
       ``(3) Financial incentive.--The Administrator may award to 
     a State that develops and implements requirements described 
     in paragraph (1), in addition to any funds that the State is 
     entitled to receive under this subtitle, not more than 
     $200,000, to be used to carry out the requirements.
       ``(c) Training.--All persons that are subject to the 
     operator training requirements of subsection (a) shall--
       ``(1) meet the training requirements developed under 
     subsection (b); and
       ``(2) repeat the applicable requirements developed under 
     subsection (b), if the tank for which they have primary daily 
     on-site management responsibilities is determined to be out 
     of compliance with--
       ``(A) a requirement or standard promulgated by the 
     Administrator under section 9003; or
       ``(B) a requirement or standard of a State program approved 
     under section 9004.''.
       (b) State Program Requirement.--Section 9004(a) of the 
     Solid Waste Disposal Act (42 U.S.C. 6991c(a)) is amended by 
     striking ``and'' at the end of paragraph (7), by striking the 
     period at the end of paragraph (8) and inserting ``; and'', 
     and by adding the following new paragraph at the end thereof:
       ``(9) State-specific training requirements as required by 
     section 9010.''.
       (c) Enforcement.--Section 9006(d)(2) of such Act (42 U.S.C. 
     6991e) is amended as follows:
       (1) By striking ``or'' at the end of subparagraph (B).

[[Page 17930]]

       (2) By adding the following new subparagraph after 
     subparagraph (C):
       ``(D) the training requirements established by States 
     pursuant to section 9010 (relating to operator training); 
     or''.
       (d) Table of Contents.--The item relating to section 9010 
     in table of contents for the Solid Waste Disposal Act is 
     amended to read as follows:

``Sec. 9010. Operator training''.

     SEC. 1525. REMEDIATION FROM OXYGENATED FUEL ADDITIVES.

       Section 9003(h) of the Solid Waste Disposal Act (42 U.S.C. 
     6991b(h)) is amended as follows:
       (1) In paragraph (7)(A)--
       (A) by striking ``paragraphs (1) and (2) of this 
     subsection'' and inserting ``paragraphs (1), (2), and (12)''; 
     and
       (B) by striking ``and including the authorities of 
     paragraphs (4), (6), and (8) of this subsection'' and 
     inserting ``and the authority under sections 9011 and 9012 
     and paragraphs (4), (6), and (8),''.
       (2) By adding at the end the following:
       ``(12) Remediation of oxygenated fuel contamination.--
       ``(A) In general.--The Administrator and the States may use 
     funds made available under section 9014(2)(B) to carry out 
     corrective actions with respect to a release of a fuel 
     containing an oxygenated fuel additive that presents a threat 
     to human health or welfare or the environment.
       ``(B) Applicable authority.--The Administrator or a State 
     shall carry out subparagraph (A) in accordance with paragraph 
     (2), and in the case of a State, in accordance with a 
     cooperative agreement entered into by the Administrator and 
     the State under paragraph (7).''.

     SEC. 1526. RELEASE PREVENTION, COMPLIANCE, AND ENFORCEMENT.

       (a) Release Prevention and Compliance.--Subtitle I of the 
     Solid Waste Disposal Act (42 U.S.C. 6991 et seq.) is amended 
     by adding at the end the following:

     ``SEC. 9011. USE OF FUNDS FOR RELEASE PREVENTION AND 
                   COMPLIANCE.

       ``Funds made available under section 9014(2)(D) from the 
     Trust Fund may be used to conduct inspections, issue orders, 
     or bring actions under this subtitle--
       ``(1) by a State, in accordance with a grant or cooperative 
     agreement with the Administrator, of State regulations 
     pertaining to underground storage tanks regulated under this 
     subtitle; and
       ``(2) by the Administrator, for tanks regulated under this 
     subtitle (including under a State program approved under 
     section 9004).''.
       (b) Government-Owned Tanks.--Section 9003 of the Solid 
     Waste Disposal Act (42 U.S.C. 6991b) is amended by adding at 
     the end the following:
       ``(i) Government-Owned Tanks.--
       ``(1) State compliance report.--(A) Not later than 2 years 
     after the date of enactment of this subsection, each State 
     that receives funding under this subtitle shall submit to the 
     Administrator a State compliance report that--
       ``(i) lists the location and owner of each underground 
     storage tank described in subparagraph (B) in the State that, 
     as of the date of submission of the report, is not in 
     compliance with section 9003; and
       ``(ii) specifies the date of the last inspection and 
     describes the actions that have been and will be taken to 
     ensure compliance of the underground storage tank listed 
     under clause (i) with this subtitle.
       ``(B) An underground storage tank described in this 
     subparagraph is an underground storage tank that is--
       ``(i) regulated under this subtitle; and
       ``(ii) owned or operated by the Federal, State, or local 
     government.
       ``(C) The Administrator shall make each report, received 
     under subparagraph (A), available to the public through an 
     appropriate media.
       ``(2) Financial incentive.--The Administrator may award to 
     a State that develops a report described in paragraph (1), in 
     addition to any other funds that the State is entitled to 
     receive under this subtitle, not more than $50,000, to be 
     used to carry out the report.
       ``(3) Not a safe harbor.--This subsection does not relieve 
     any person from any obligation or requirement under this 
     subtitle.''.
       (c) Public Record.--Section 9002 of the Solid Waste 
     Disposal Act (42 U.S.C. 6991a) is amended by adding at the 
     end the following:
       ``(d) Public Record.--
       ``(1) In general.--The Administrator shall require each 
     State that receives Federal funds to carry out this subtitle 
     to maintain, update at least annually, and make available to 
     the public, in such manner and form as the Administrator 
     shall prescribe (after consultation with States), a record of 
     underground storage tanks regulated under this subtitle.
       ``(2) Considerations.--To the maximum extent practicable, 
     the public record of a State, respectively, shall include, 
     for each year--
       ``(A) the number, sources, and causes of underground 
     storage tank releases in the State;
       ``(B) the record of compliance by underground storage tanks 
     in the State with--
       ``(i) this subtitle; or
       ``(ii) an applicable State program approved under section 
     9004; and
       ``(C) data on the number of underground storage tank 
     equipment failures in the State.''.
       (d) Incentive for Performance.--Section 9006 of the Solid 
     Waste Disposal Act (42 U.S.C. 6991e) is amended by adding at 
     the end the following:
       ``(e) Incentive for Performance.--Both of the following may 
     be taken into account in determining the terms of a civil 
     penalty under subsection (d):
       ``(1) The compliance history of an owner or operator in 
     accordance with this subtitle or a program approved under 
     section 9004.
       ``(2) Any other factor the Administrator considers 
     appropriate.''.
       (e) Table of Contents.--The table of contents for such 
     subtitle I is amended by adding the following new item at the 
     end thereof:

``Sec. 9011. Use of funds for release prevention and compliance''.

     SEC. 1527. DELIVERY PROHIBITION.

       (a) In General.--Subtitle I of the Solid Waste Disposal Act 
     (42 U.S.C. 6991 et seq.) is amended by adding at the end the 
     following:

     ``SEC. 9012. DELIVERY PROHIBITION.

       ``(a) Requirements.--
       ``(1) Prohibition of delivery or deposit.--Beginning 2 
     years after the date of enactment of this section, it shall 
     be unlawful to deliver to, deposit into, or accept a 
     regulated substance into an underground storage tank at a 
     facility which has been identified by the Administrator or a 
     State implementing agency to be ineligible for such delivery, 
     deposit, or acceptance.
       ``(2) Guidance.--Within 1 year after the date of enactment 
     of this section, the Administrator shall, in consultation 
     with the States, underground storage tank owners, and product 
     delivery industries, publish guidelines detailing the 
     specific processes and procedures they will use to implement 
     the provisions of this section. The processes and procedures 
     include, at a minimum--
       ``(A) the criteria for determining which underground 
     storage tank facilities are ineligible for delivery, deposit, 
     or acceptance of a regulated substance;
       ``(B) the mechanisms for identifying which facilities are 
     ineligible for delivery, deposit, or acceptance of a 
     regulated substance to the underground storage tank owning 
     and fuel delivery industries;
       ``(C) the process for reclassifying ineligible facilities 
     as eligible for delivery, deposit, or acceptance of a 
     regulated substance;
       ``(D) one or more processes for providing adequate notice 
     to underground storage tank owners and operators and supplier 
     industries that an underground storage tank has been 
     determined to be ineligible for delivery, deposit, or 
     acceptance or a regulated substance; and
       ``(E) a delineation of, or a process for determining, the 
     specified geographic areas subject to paragraph (4).
       ``(3) Compliance.--States that receive funding under this 
     subtitle shall, at a minimum, comply with the processes and 
     procedures published under paragraph (2).
       ``(4) Consideration.--
       ``(A) Rural and remote areas.--Subject to subparagraph (B), 
     the Administrator or a State may consider not treating an 
     underground storage tank as ineligible for delivery, deposit 
     or acceptance of a regulated substance if such treatment 
     would jeopardize the availability of, or access to, fuel in 
     any rural and remote areas unless an urgent threat to public 
     health, as determined by the Administrator, exists.
       ``(B) Applicability.--Subparagraph (A) shall apply only 
     during the 180-day period following the date of a 
     determination by the Administrator or the appropriate State 
     under subparagraph (A).
       ``(b) Effect on State Authority.--Nothing in this section 
     shall affect or preempt the authority of a State to prohibit 
     the delivery, deposit, or acceptance of a regulated substance 
     to an underground storage tank.
       ``(c) Defense to Violation.--A person shall not be in 
     violation of subsection (a)(1) if the person has not been 
     provided with notice pursuant to subsection (a)(2)(D) of the 
     ineligibility of a facility for delivery, deposit, or 
     acceptance of a regulated substance as determined by the 
     Administrator or a State, as appropriate, under this 
     section.''.
       (b) Enforcement.--Section 9006(d)(2) of such Act (42 U.S.C. 
     6991e(d)(2)) is amended as follows:
       (1) By adding the following new subparagraph after 
     subparagraph (D):
       ``(E) the delivery prohibition requirement established by 
     section 9012,''.
       (2) By adding the following new sentence at the end 
     thereof: ``Any person making or accepting a delivery or 
     deposit of a regulated substance to an underground storage 
     tank at an ineligible facility in violation of section 9012 
     shall also be subject to the same civil penalty for each day 
     of such violation.''.
       (c) Table of Contents.--The table of contents for such 
     subtitle I is amended by adding the following new item at the 
     end thereof:

``Sec. 9012. Delivery prohibition''.

     SEC. 1528. FEDERAL FACILITIES.

       Section 9007 of the Solid Waste Disposal Act (42 U.S.C. 
     6991f) is amended to read as follows:

     ``SEC. 9007. FEDERAL FACILITIES.

       ``(a) In General.--Each department, agency, and 
     instrumentality of the executive, legislative, and judicial 
     branches of the Federal Government (1) having jurisdiction 
     over any underground storage tank or underground storage tank 
     system, or (2) engaged in any activity resulting, or which 
     may result, in the installation, operation, management, or 
     closure of any underground storage tank, release response 
     activities related thereto, or in the delivery, acceptance, 
     or deposit of any regulated substance to an underground 
     storage tank or underground storage tank system shall be 
     subject to, and comply with, all Federal, State, interstate, 
     and local requirements, both substantive and procedural 
     (including any requirement for permits or

[[Page 17931]]

     reporting or any provisions for injunctive relief and such 
     sanctions as may be imposed by a court to enforce such 
     relief), respecting underground storage tanks in the same 
     manner, and to the same extent, as any person is subject to 
     such requirements, including the payment of reasonable 
     service charges. The Federal, State, interstate, and local 
     substantive and procedural requirements referred to in this 
     subsection include, but are not limited to, all 
     administrative orders and all civil and administrative 
     penalties and fines, regardless of whether such penalties or 
     fines are punitive or coercive in nature or are imposed for 
     isolated, intermittent, or continuing violations. The United 
     States hereby expressly waives any immunity otherwise 
     applicable to the United States with respect to any such 
     substantive or procedural requirement (including, but not 
     limited to, any injunctive relief, administrative order or 
     civil or administrative penalty or fine referred to in the 
     preceding sentence, or reasonable service charge). The 
     reasonable service charges referred to in this subsection 
     include, but are not limited to, fees or charges assessed in 
     connection with the processing and issuance of permits, 
     renewal of permits, amendments to permits, review of plans, 
     studies, and other documents, and inspection and monitoring 
     of facilities, as well as any other nondiscriminatory charges 
     that are assessed in connection with a Federal, State, 
     interstate, or local underground storage tank regulatory 
     program. Neither the United States, nor any agent, employee, 
     or officer thereof, shall be immune or exempt from any 
     process or sanction of any State or Federal Court with 
     respect to the enforcement of any such injunctive relief. No 
     agent, employee, or officer of the United States shall be 
     personally liable for any civil penalty under any Federal, 
     State, interstate, or local law concerning underground 
     storage tanks with respect to any act or omission within the 
     scope of the official duties of the agent, employee, or 
     officer. An agent, employee, or officer of the United States 
     shall be subject to any criminal sanction (including, but not 
     limited to, any fine or imprisonment) under any Federal or 
     State law concerning underground storage tanks, but no 
     department, agency, or instrumentality of the executive, 
     legislative, or judicial branch of the Federal Government 
     shall be subject to any such sanction. The President may 
     exempt any underground storage tank of any department, 
     agency, or instrumentality in the executive branch from 
     compliance with such a requirement if he determines it to be 
     in the paramount interest of the United States to do so. No 
     such exemption shall be granted due to lack of appropriation 
     unless the President shall have specifically requested such 
     appropriation as a part of the budgetary process and the 
     Congress shall have failed to make available such requested 
     appropriation. Any exemption shall be for a period not in 
     excess of one year, but additional exemptions may be granted 
     for periods not to exceed one year upon the President's 
     making a new determination. The President shall report each 
     January to the Congress all exemptions from the requirements 
     of this section granted during the preceding calendar year, 
     together with his reason for granting each such exemption.
       ``(b) Review of and Report on Federal Underground Storage 
     Tanks.--
       ``(1) Review.--Not later than 12 months after the date of 
     enactment of the Underground Storage Tank Compliance Act , 
     each Federal agency that owns or operates 1 or more 
     underground storage tanks, or that manages land on which 1 or 
     more underground storage tanks are located, shall submit to 
     the Administrator, the Committee on Energy and Commerce of 
     the United States House of Representatives, and the Committee 
     on the Environment and Public Works of the United States 
     Senate a compliance strategy report that--
       ``(A) lists the location and owner of each underground 
     storage tank described in this paragraph;
       ``(B) lists all tanks that are not in compliance with this 
     subtitle that are owned or operated by the Federal agency;
       ``(C) specifies the date of the last inspection by a State 
     or Federal inspector of each underground storage tank owned 
     or operated by the agency;
       ``(D) lists each violation of this subtitle respecting any 
     underground storage tank owned or operated by the agency;
       ``(E) describes the operator training that has been 
     provided to the operator and other persons having primary 
     daily on-site management responsibility for the operation and 
     maintenance of underground storage tanks owned or operated by 
     the agency; and
       ``(F) describes the actions that have been and will be 
     taken to ensure compliance for each underground storage tank 
     identified under subparagraph (B).
       ``(2) Not a safe harbor.--This subsection does not relieve 
     any person from any obligation or requirement under this 
     subtitle.''.

     SEC. 1529. TANKS ON TRIBAL LANDS.

       (a) In General.--Subtitle I of the Solid Waste Disposal Act 
     (42 U.S.C. 6991 et seq.) is amended by adding the following 
     at the end thereof:

     ``SEC. 9013. TANKS ON TRIBAL LANDS.

       ``(a) Strategy.--The Administrator, in coordination with 
     Indian tribes, shall, not later than 1 year after the date of 
     enactment of this section, develop and implement a strategy--
       ``(1) giving priority to releases that present the greatest 
     threat to human health or the environment, to take necessary 
     corrective action in response to releases from leaking 
     underground storage tanks located wholly within the 
     boundaries of--
       ``(A) an Indian reservation; or
       ``(B) any other area under the jurisdiction of an Indian 
     tribe; and
       ``(2) to implement and enforce requirements concerning 
     underground storage tanks located wholly within the 
     boundaries of--
       ``(A) an Indian reservation; or
       ``(B) any other area under the jurisdiction of an Indian 
     tribe.
       ``(b) Report.--Not later than 2 years after the date of 
     enactment of this section, the Administrator shall submit to 
     Congress a report that summarizes the status of 
     implementation and enforcement of this subtitle in areas 
     located wholly within--
       ``(1) the boundaries of Indian reservations; and
       ``(2) any other areas under the jurisdiction of an Indian 
     tribe.

     The Administrator shall make the report under this subsection 
     available to the public.
       ``(c) Not a Safe Harbor.--This section does not relieve any 
     person from any obligation or requirement under this 
     subtitle.
       ``(d) State Authority.--Nothing in this section applies to 
     any underground storage tank that is located in an area under 
     the jurisdiction of a State, or that is subject to regulation 
     by a State, as of the date of enactment of this section.''.
       (b) Table of Contents.--The table of contents for such 
     subtitle I is amended by adding the following new item at the 
     end thereof:

``Sec. 9013. Tanks on Tribal lands''.

     SEC. 1530. ADDITIONAL MEASURES TO PROTECT GROUNDWATER.

       (a) In General.--Section 9003 of the Solid Waste Disposal 
     Act (42 U.S.C. 6991b) is amended by adding the following new 
     subsection at the end:
       ``(i) Additional Measures to Protect Groundwater From 
     Contamination.--The Administrator shall require each State 
     that receives funding under this subtitle to require one of 
     the following:
       ``(1) Tank and piping secondary containment.--(A) Each new 
     underground storage tank, or piping connected to any such new 
     tank, installed after the effective date of this subsection, 
     or any existing underground storage tank, or existing piping 
     connected to such existing tank, that is replaced after the 
     effective date of this subsection, shall be secondarily 
     contained and monitored for leaks if the new or replaced 
     underground storage tank or piping is within 1,000 feet of 
     any existing community water system or any existing potable 
     drinking water well.
       ``(B) In the case of a new underground storage tank system 
     consisting of one or more underground storage tanks and 
     connected by piping, subparagraph (A) shall apply to all 
     underground storage tanks and connected pipes comprising such 
     system.
       ``(C) In the case of a replacement of an existing 
     underground storage tank or existing piping connected to the 
     underground storage tank, subparagraph (A) shall apply only 
     to the specific underground storage tank or piping being 
     replaced, not to other underground storage tanks and 
     connected pipes comprising such system.
       ``(D) Each installation of a new motor fuel dispenser 
     system, after the effective date of this subsection, shall 
     include under-dispenser spill containment if the new 
     dispenser is within 1,000 feet of any existing community 
     water system or any existing potable drinking water well.
       ``(E) This paragraph shall not apply to repairs to an 
     underground storage tank, piping, or dispenser that are meant 
     to restore a tank, pipe, or dispenser to operating condition.
       ``(F) As used in this subsection:
       ``(i) The term `secondarily contained' means a release 
     detection and prevention system that meets the requirements 
     of 40 CFR 280.43(g), but shall not include under-dispenser 
     spill containment or control systems.
       ``(ii) The term `underground storage tank' has the meaning 
     given to it in section 9001, except that such term does not 
     include tank combinations or more than a single underground 
     pipe connected to a tank.
       ``(iii) The term `installation of a new motor fuel 
     dispenser system' means the installation of a new motor fuel 
     dispenser and the equipment necessary to connect the 
     dispenser to the underground storage tank system, but does 
     not mean the installation of a motor fuel dispenser installed 
     separately from the equipment need to connect the dispenser 
     to the underground storage tank system.
       ``(2) Evidence of financial responsibility and 
     certification.--
       ``(A) Manufacturer and installer financial 
     responsibility.--A person that manufactures an underground 
     storage tank or piping for an underground storage tank system 
     or that installs an underground storage tank system is 
     required to maintain evidence of financial responsibility 
     under section 9003(d) in order to provide for the costs of 
     corrective actions directly related to releases caused by 
     improper manufacture or installation unless the person can 
     demonstrate themselves to be already covered as an owner or 
     operator of an underground storage tank under section 9003.
       ``(B) Installer certification.--The Administrator and each 
     State that receives funding under this subtitle, as 
     appropriate, shall require that a person that installs an 
     underground storage tank system is--
       ``(i) certified or licensed by the tank and piping 
     manufacturer;
       ``(ii) certified or licensed by the Administrator or a 
     State, as appropriate;

[[Page 17932]]

       ``(iii) has their underground storage tank system 
     installation certified by a registered professional engineer 
     with education and experience in underground storage tank 
     system installation;
       ``(iv) has had their installation of the underground 
     storage tank inspected and approved by the Administrator or 
     the State, as appropriate;
       ``(v) compliant with a code of practice developed by a 
     nationally recognized association or independent testing 
     laboratory and in accordance with the manufacturer's 
     instructions; or
       ``(vi) compliant with another method that is determined by 
     the Administrator or a State, as appropriate, to be no less 
     protective of human health and the environment.
       ``(C) Savings clause.--Nothing in subparagraph (A) alters 
     or affects the liability of any owner or operator of an 
     underground storage tank.''.
       (b) Effective Date.--This subsection shall take effect 18 
     months after the date of enactment of this subsection.
       (c) Promulgation of Regulations or Guidelines.--The 
     Administrator shall issue regulations or guidelines 
     implementing the requirements of this subsection, including 
     guidance to differentiate between the terms ``repair'' and 
     ``replace'' for the purposes of section 9003(i)(1) of the 
     Solid Waste Disposal Act.
       (d) Penalties.--Section 9006(d)(2) of such Act (42 U.S.C. 
     6991e(d)(2)) is amended as follows:
       (1) By striking ``or'' at the end of subparagraph (B).
       (2) By inserting ``; or'' at the end of subparagraph (C).
       (3) By adding the following new subparagraph after 
     subparagraph (C):
       ``(D) the requirements established in section 9003(i),''.

     SEC. 1531. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--Subtitle I of the Solid Waste Disposal Act 
     (42 U.S.C. 6991 et seq.) is amended by adding at the end the 
     following:

     ``SEC. 9014. AUTHORIZATION OF APPROPRIATIONS.

       ``There are authorized to be appropriated to the 
     Administrator the following amounts:
       ``(1) To carry out subtitle I (except sections 9003(h), 
     9005(c), 9011 and 9012) $50,000,000 for each of fiscal years 
     2005 through 2009.
       ``(2) From the Trust Fund, notwithstanding section 
     9508(c)(1) of the Internal Revenue Code of 1986:
       ``(A) to carry out section 9003(h) (except section 
     9003(h)(12)) $200,000,000 for each of fiscal years 2005 
     through 2009;
       ``(B) to carry out section 9003(h)(12), $200,000,000 for 
     each of fiscal years 2005 through 2009;
       ``(C) to carry out sections 9003(i), 9004(f), and 9005(c) 
     $100,000,000 for each of fiscal years 2005 through 2009; and
       ``(D) to carry out sections 9010, 9011, 9012, and 9013 
     $55,000,000 for each of fiscal years 2005 through 2009.''.
       (b) Table of Contents.--The table of contents for such 
     subtitle I is amended by adding the following new item at the 
     end thereof:

``Sec. 9014. Authorization of appropriations''.

     SEC. 1532. CONFORMING AMENDMENTS.

       (a) In General.--Section 9001 of the Solid Waste Disposal 
     Act (42 U.S.C. 6991) is amended as follows:
       (1) By striking ``For the purposes of this subtitle--'' and 
     inserting ``In this subtitle:''.
       (2) By redesignating paragraphs (1), (2), (3), (4), (5), 
     (6), (7), and (8) as paragraphs (10), (7), (4), (3), (8), 
     (5), (2), and (6), respectively.
       (3) By inserting before paragraph (2) (as redesignated by 
     paragraph (2) of this subsection) the following:
       ``(1) Indian tribe.--
       ``(A) In general.--The term `Indian tribe' means any Indian 
     tribe, band, nation, or other organized group or community 
     that is recognized as being eligible for special programs and 
     services provided by the United States to Indians because of 
     their status as Indians.
       ``(B) Inclusions.--The term `Indian tribe' includes an 
     Alaska Native village, as defined in or established under the 
     Alaska Native Claims Settlement Act (43 U.S.C. 1601 et seq.); 
     and''.
       (4) By inserting after paragraph (8) (as redesignated by 
     paragraph (2) of this subsection) the following:
       ``(9) Trust fund.--The term `Trust Fund' means the Leaking 
     Underground Storage Tank Trust Fund established by section 
     9508 of the Internal Revenue Code of 1986.''.
       (b) Conforming Amendments.--The Solid Waste Disposal Act 
     (42 U.S.C. 6901 and following) is amended as follows:
       (1) Section 9003(f) (42 U.S.C. 6991b(f)) is amended--
       (A) in paragraph (1), by striking ``9001(2)(B)'' and 
     inserting ``9001(7)(B)''; and
       (B) in paragraphs (2) and (3), by striking ``9001(2)(A)'' 
     each place it appears and inserting ``9001(7)(A)''.
       (2) Section 9003(h) (42 U.S.C. 6991b(h)) is amended in 
     paragraphs (1), (2)(C), (7)(A), and (11) by striking 
     ``Leaking Underground Storage Tank Trust Fund'' each place it 
     appears and inserting ``Trust Fund''.
       (3) Section 9009 (42 U.S.C. 6991h) is amended--
       (A) in subsection (a), by striking ``9001(2)(B)'' and 
     inserting ``9001(7)(B)''; and
       (B) in subsection (d), by striking ``section 9001(1) (A) 
     and (B)'' and inserting ``subparagraphs (A) and (B) of 
     section 9001(10)''.

     SEC. 1533. TECHNICAL AMENDMENTS.

       The Solid Waste Disposal Act is amended as follows:
       (1) Section 9001(4)(A) (42 U.S.C. 6991(4)(A)) is amended by 
     striking ``sustances'' and inserting ``substances''.
       (2) Section 9003(f)(1) (42 U.S.C. 6991b(f)(1)) is amended 
     by striking ``subsection (c) and (d) of this section'' and 
     inserting ``subsections (c) and (d)''.
       (3) Section 9004(a) (42 U.S.C. 6991c(a)) is amended by 
     striking ``in 9001(2) (A) or (B) or both'' and inserting ``in 
     subparagraph (A) or (B) of section 9001(7)''.
       (4) Section 9005 (42 U.S.C. 6991d) is amended--
       (A) in subsection (a), by striking ``study taking'' and 
     inserting ``study, taking'';
       (B) in subsection (b)(1), by striking ``relevent'' and 
     inserting ``relevant''; and
       (C) in subsection (b)(4), by striking ``Evironmental'' and 
     inserting ``Environmental''.
                       Subtitle C--Boutique Fuels

     SEC. 1541. REDUCING THE PROLIFERATION OF BOUTIQUE FUELS.

       (a) Temporary Waivers During Supply Emergencies.--Section 
     211(c)(4)(C) of the Clean Air Act (42 U.S.C. 7545(c)(4)(C)) 
     is amended by inserting ``(i)'' after ``(C)'' and by adding 
     the following new clauses at the end thereof:
       ``(ii) The Administrator may temporarily waive a control or 
     prohibition respecting the use of a fuel or fuel additive 
     required or regulated by the Administrator pursuant to 
     subsection (c), (h), (i), (k), or (m) of this section or 
     prescribed in an applicable implementation plan under section 
     110 approved by the Administrator under clause (i) of this 
     subparagraph if, after consultation with, and concurrence by, 
     the Secretary of Energy, the Administrator determines that--
       ``(I) extreme and unusual fuel or fuel additive supply 
     circumstances exist in a State or region of the Nation which 
     prevent the distribution of an adequate supply of the fuel or 
     fuel additive to consumers;
       ``(II) such extreme and unusual fuel and fuel additive 
     supply circumstances are the result of a natural disaster, an 
     Act of God, a pipeline or refinery equipment failure, or 
     another event that could not reasonably have been foreseen or 
     prevented and not the lack of prudent planning on the part of 
     the suppliers of the fuel or fuel additive to such State or 
     region; and
       ``(III) it is in the public interest to grant the waiver 
     (for example, when a waiver is necessary to meet projected 
     temporary shortfalls in the supply of the fuel or fuel 
     additive in a State or region of the Nation which cannot 
     otherwise be compensated for).
       ``(iii) If the Administrator makes the determinations 
     required under clause (ii), such a temporary extreme and 
     unusual fuel and fuel additive supply circumstances waiver 
     shall be permitted only if--
       ``(I) the waiver applies to the smallest geographic area 
     necessary to address the extreme and unusual fuel and fuel 
     additive supply circumstances;
       ``(II) the waiver is effective for a period of 20 calendar 
     days or, if the Administrator determines that a shorter 
     waiver period is adequate, for the shortest practicable time 
     period necessary to permit the correction of the extreme and 
     unusual fuel and fuel additive supply circumstances and to 
     mitigate impact on air quality;
       ``(III) the waiver permits a transitional period, the exact 
     duration of which shall be determined by the Administrator 
     (but which shall be for the shortest practicable period), 
     after the termination of the temporary waiver to permit 
     wholesalers and retailers to blend down their wholesale and 
     retail inventory;
       ``(IV) the waiver applies to all persons in the motor fuel 
     distribution system; and
       ``(V) the Administrator has given public notice to all 
     parties in the motor fuel distribution system, and local and 
     State regulators, in the State or region to be covered by the 
     waiver.

     The term `motor fuel distribution system' as used in this 
     clause shall be defined by the Administrator through 
     rulemaking.
       ``(iv) Within 180 days of the date of enactment of this 
     clause, the Administrator shall promulgate regulations to 
     implement clauses (ii) and (iii).
       ``(v) Nothing in this subparagraph shall--
       ``(I) limit or otherwise affect the application of any 
     other waiver authority of the Administrator pursuant to this 
     section or pursuant to a regulation promulgated pursuant to 
     this section; and
       ``(II) subject any State or person to an enforcement 
     action, penalties, or liability solely arising from actions 
     taken pursuant to the issuance of a waiver under this 
     subparagraph.''.
       (b) Limit on Number of Boutique Fuels.--Section 
     211(c)(4)(C) of the Clean Air Act (42 U.S.C. 7545(c)(4)), as 
     amended by subsection (a), is further amended by adding at 
     the end the following:
       ``(v)(I) The Administrator shall have no authority, when 
     considering a State implementation plan or a State 
     implementation plan revision, to approve under this paragraph 
     any fuel included in such plan or revision if the effect of 
     such approval increases the total number of fuels approved 
     under this paragraph as of September 1, 2004, in all State 
     implementation plans.
       ``(II) The Administrator, in consultation with the 
     Secretary of Energy, shall determine the total number of 
     fuels approved under this paragraph as of September 1, 2004, 
     in all State implementation plans and shall publish a list of 
     such fuels, including the states and Petroleum Administration 
     for Defense District in which they are used, in the Federal 
     Register for public review and comment no later than 90 days 
     after enactment.

[[Page 17933]]

       ``(III) The Administrator shall remove a fuel from the list 
     published under subclause (II) if a fuel ceases to be 
     included in a State implementation plan or if a fuel in a 
     State implementation plan is identical to a Federal fuel 
     formulation implemented by the Administrator, but the 
     Administrator shall not reduce the total number of fuels 
     authorized under the list published under subclause (II).
       ``(IV) Subclause (I) shall not limit the Administrator's 
     authority to approve a control or prohibition respecting any 
     new fuel under this paragraph in a State implementation plan 
     or revision to a State implementation plan if such new fuel:
       ``(aa) completely replaces a fuel on the list published 
     under subclause (II); or
       ``(bb) does not increase the total number of fuels on the 
     list published under subclause (II) as of September 1, 2004.

     In the event that the total number of fuels on the list 
     published under subclause (II) at the time of the 
     Administrator's consideration of a control or prohibition 
     respecting a new fuel is lower than the total number of fuels 
     on such list as of September 1, 2004, the Administrator may 
     approve a control or prohibition respecting a new fuel under 
     this subclause if the Administrator, after consultation with 
     the Secretary of Energy, publishes in the Federal Register 
     after notice and comment a finding that, in the 
     Administrator's judgment, such control or prohibition 
     respecting a new fuel will not cause fuel supply or 
     distribution interruptions or have a significant adverse 
     impact on fuel producibility in the affected area or 
     contiguous areas.
       ``(V) The Administrator shall have no authority under this 
     paragraph, when considering any particular State's 
     implementation plan or a revision to that State's 
     implementation plan, to approve any fuel unless that fuel 
     was, as of the date of such consideration, approved in at 
     least one State implementation plan in the applicable 
     Petroleum Administration for Defense District. However, the 
     Administrator may approve as part of a State implementation 
     plan or State implementation plan revision a fuel with a 
     summertime Reid Vapor Pressure of 7.0 psi. In no event shall 
     such approval by the Administrator cause an increase in the 
     total number of fuels on the list published under subclause 
     (II).
       ``(VI) Nothing in this clause shall be construed to have 
     any effect regarding any available authority of States to 
     require the use of any fuel additive registered in accordance 
     with subsection (b), including any fuel additive registered 
     in accordance with subsection (b) after the enactment of this 
     subclause.''.
       (c) Study and Report to Congress on Boutique Fuels.--
       (1) Joint study.--The Administrator of the Environmental 
     Protection Agency and the Secretary shall undertake a study 
     of the effects on air quality, on the number of fuel blends, 
     on fuel availability, on fuel fungibility, and on fuel costs 
     of the State plan provisions adopted pursuant to section 
     211(c)(4)(C) of the Clean Air Act (42 U.S.C. 7545(c)(4)(C)).
       (2) Focus of study.--The primary focus of the study 
     required under paragraph (1) shall be to determine how to 
     develop a Federal fuels system that maximizes motor fuel 
     fungibility and supply, addresses air quality requirements, 
     and reduces motor fuel price volatility including that which 
     has resulted from the proliferation of boutique fuels, and to 
     recommend to Congress such legislative changes as are 
     necessary to implement such a system. The study should 
     include the impacts on overall energy supply, distribution, 
     and use as a result of the legislative changes recommended.
       (3) Conduct of study.--In carrying out their joint duties 
     under this section, the Administrator and the Secretary shall 
     use sound science and objective science practices, shall 
     consider the best available science, shall use data collected 
     by accepted means and shall consider and include a 
     description of the weight of the scientific evidence. The 
     Administrator and the Secretary shall coordinate the study 
     required by this section with other studies required by the 
     act.
       (4) Responsibility of administrator.--In carrying out the 
     study required by this section, the Administrator shall 
     coordinate obtaining comments from affected parties 
     interested in the air quality impact assessment portion of 
     the study.
       (5) Responsibility of secretary.--In carrying out the study 
     required by this section, the Secretary shall coordinate 
     obtaining comments from affected parties interested in the 
     fuel availability, number of fuel blends, fuel fungibility 
     and fuel costs portion of the study.
       (6) Report to congress.--The Administrator and the 
     Secretary jointly shall submit the results of the study 
     required by this section in a report to the Congress not 
     later than 12 months after the date of the enactment of this 
     Act, together with any recommended regulatory and legislative 
     changes. Such report shall be submitted to the Committee on 
     Energy and Commerce of the United States House of 
     Representatives and the Committees on Energy and Natural 
     Resources and on Environment and Public Works of the United 
     States Senate.
       (7) Authorization of appropriations.--There is authorized 
     to be appropriated jointly to the Administrator and the 
     Secretary $500,000 for the completion of the study required 
     under this subsection.
       (d) Definitions.--In this section:
       (1) The term ``Administrator'' means the Administrator of 
     the Environmental Protection Agency.
       (2) The term ``fuel'' means gasoline, diesel fuel, and any 
     other liquid petroleum product commercially known as gasoline 
     and diesel fuel for use in highway and nonroad motor 
     vehicles.
       (3) The term ``a control or prohibition respecting a new 
     fuel'' means a control or prohibition on the formulation, 
     composition, or emissions characteristics of a fuel that 
     would require the increase or decrease of a constituent in 
     gasoline or diesel fuel.
                       TITLE XVI--CLIMATE CHANGE
       Subtitle A--National Climate Change Technology Deployment

     SEC. 1601. GREENHOUSE GAS INTENSITY REDUCING TECHNOLOGY 
                   STRATEGIES.

       Title XVI of the Energy Policy Act of 1992 (42 U.S.C. 13381 
     et seq.) is amended by adding at the end the following:

     ``SEC. 1610. GREENHOUSE GAS INTENSITY REDUCING STRATEGIES.

       ``(a) Definitions.--In this section:
       ``(1) Advisory committee.--The term `Advisory Committee' 
     means the Climate Change Technology Advisory Committee 
     established under subsection (f)(1).
       ``(2) Carbon sequestration.--The term `carbon 
     sequestration' means the capture of carbon dioxide through 
     terrestrial, geological, biological, or other means, which 
     prevents the release of carbon dioxide into the atmosphere.
       ``(3) Committee.--The term `Committee' means the Committee 
     on Climate Change Technology established under subsection 
     (b)(1).
       ``(4) Developing country.--The term `developing country' 
     has the meaning given the term in section 1608(m).
       ``(5) Greenhouse gas.--The term `greenhouse gas' means--
       ``(A) carbon dioxide;
       ``(B) methane;
       ``(C) nitrous oxide;
       ``(D) hydrofluorocarbons;
       ``(E) perfluorocarbons; and
       ``(F) sulfur hexafluoride.
       ``(6) Greenhouse gas intensity.--The term `greenhouse gas 
     intensity' means the ratio of greenhouse gas emissions to 
     economic output.
       ``(7) National laboratory.--The term `National Laboratory' 
     has the meaning given the term in section 3(3) of the Energy 
     Policy Act of 2005.
       ``(b) Committee on Climate Change Technology.--
       ``(1) In general.--Not later than 180 days after the date 
     of enactment of this section, the President shall establish a 
     Committee on Climate Change Technology to--
       ``(A) integrate current Federal climate reports; and
       ``(B) coordinate Federal climate change technology 
     activities and programs carried out in furtherance of the 
     strategy developed under subsection (c)(1).
       ``(2) Membership.--The Committee shall be composed of at 
     least 7 members, including--
       ``(A) the Secretary, who shall chair the Committee;
       ``(B) the Secretary of Commerce;
       ``(C) the Chairman of the Council on Environmental Quality;
       ``(D) the Secretary of Agriculture;
       ``(E) the Administrator of the Environmental Protection 
     Agency;
       ``(F) the Secretary of Transportation;
       ``(G) the Director of the Office of Science and Technology 
     Policy; and
       ``(H) other representatives as may be determined by the 
     President.
       ``(3) Staff.--The members of the Committee shall provide 
     such personnel as are necessary to enable the Committee to 
     perform its duties.
       ``(c) National Climate Change Technology Policy.--
       ``(1) In general.--Not later than 18 months after the date 
     of enactment of this section, the Committee shall, based on 
     applicable Federal climate reports, submit to the Secretary 
     and the President a national strategy to promote the 
     deployment and commercialization of greenhouse gas intensity 
     reducing technologies and practices developed through 
     research and development programs conducted by the National 
     Laboratories, other Federal research facilities, institutions 
     of higher education, and the private sector.
       ``(2) Updates.--The Committee shall--
       ``(A) at the time of submission of the strategy to the 
     President under paragraph (1), also make the strategy 
     available to the public; and
       ``(B) update the strategy every 5 years, or more frequently 
     as the Committee determines to be necessary.
       ``(d) Climate Change Technology Program.--Not later than 
     180 days after the date on which the Committee is established 
     under subsection (b)(1), the Secretary, in consultation with 
     the Committee, shall establish within the Department of 
     Energy the Climate Change Technology Program to--
       ``(1) assist the Committee in the interagency coordination 
     of climate change technology research, development, 
     demonstration, and deployment to reduce greenhouse gas 
     intensity; and
       ``(2) carry out the programs authorized under this section.
       ``(e) Technology Inventory.--
       ``(1) In general.--The Secretary shall conduct and make 
     public an inventory and evaluation of greenhouse gas 
     intensity reducing technologies that have been developed, or 
     are under development, by the National Laboratories, other 
     Federal research facilities, institutions of higher 
     education, and the private sector to determine which 
     technologies are suitable for commercialization and 
     deployment.
       ``(2) Report.--Not later than 180 days after the completion 
     of the inventory under paragraph (1), the Secretary shall 
     submit to Congress

[[Page 17934]]

     a report that includes the results of the completed inventory 
     and any recommendations of the Secretary.
       ``(3) Use.--The Secretary shall use the results of the 
     inventory as guidance in the commercialization and deployment 
     of greenhouse gas intensity reducing technologies.
       ``(4) Updated inventory.--The Secretary shall--
       ``(A) periodically update the inventory under paragraph 
     (1), including when determined necessary by the Committee; 
     and
       ``(B) make the updated inventory available to the public.
       ``(f) Climate Change Technology Advisory Committee.--
       ``(1) In general.--The Secretary, in consultation with the 
     Committee, may establish under section 624 of the Department 
     of Energy Organization Act (42 U.S.C. 7234) a Climate Change 
     Technology Advisory Committee to identify statutory, 
     regulatory, economic, and other barriers to the 
     commercialization and deployment of greenhouse gas intensity 
     reducing technologies and practices in the United States.
       ``(2) Composition.--The Advisory Committee shall be 
     composed of the following members, to be appointed by the 
     Secretary, in consultation with the Committee:
       ``(A) 1 representative shall be appointed from each 
     National Laboratory.
       ``(B) 3 members shall be representatives of energy-
     producing trade organizations.
       ``(C) 3 members shall represent energy-intensive trade 
     organizations.
       ``(D) 3 members shall represent groups that represent end-
     use energy and other consumers.
       ``(E) 3 members shall be employees of the Federal 
     Government who are experts in energy technology, intellectual 
     property, and tax.
       ``(F) 3 members shall be representatives of institutions of 
     higher education with expertise in energy technology 
     development that are recommended by the National Academy of 
     Engineering.
       ``(3) Report.--Not later than 1 year after the date of 
     enactment of this section and annually thereafter, the 
     Advisory Committee shall submit to the Committee a report 
     that describes--
       ``(A) the findings of the Advisory Committee; and
       ``(B) any recommendations of the Advisory Committee for the 
     removal or reduction of barriers to commercialization, 
     deployment, and increasing the use of greenhouse gas 
     intensity reducing technologies and practices.
       ``(g) Greenhouse Gas Intensity Reducing Technology 
     Deployment.--
       ``(1) In general.--Based on the strategy developed under 
     subsection (c)(1), the technology inventory conducted under 
     subsection (e)(1), the greenhouse gas intensity reducing 
     technology study report submitted under subsection (e)(2), 
     and reports under subsection (f)(3), if any, the Committee 
     shall develop recommendations that would provide for the 
     removal of domestic barriers to the commercialization and 
     deployment of greenhouse gas intensity reducing technologies 
     and practices.
       ``(2) Requirements.--In developing the recommendations 
     under paragraph (1), the Committee shall consider in the 
     aggregate--
       ``(A) the cost-effectiveness of the technology;
       ``(B) fiscal and regulatory barriers;
       ``(C) statutory and other barriers; and
       ``(D) intellectual property issues.
       ``(3) Demonstration projects.--In developing 
     recommendations under paragraph (1), the Committee may 
     identify the need for climate change technology demonstration 
     projects.
       ``(4) Report.--Not later than 18 months after the date of 
     enactment of this section, the Committee shall submit to the 
     President and Congress a report that--
       ``(A) identifies, based on the report submitted under 
     subsection (f)(3), any barriers to, and commercial risks 
     associated with, the deployment of greenhouse gas intensity 
     reducing technologies; and
       ``(B) includes a plan for carrying out demonstration 
     projects.
       ``(5) Updates.--The Committee shall--
       ``(A) at the time of submission of the report to Congress 
     under paragraph (4), also make the report available to the 
     public; and
       ``(B) update the report every 5 years, or more frequently 
     as the Committee determines to be necessary.
       ``(h) Procedures for Calculating, Monitoring, and Analyzing 
     Greenhouse Gas Intensity.--The Secretary, in collaboration 
     with the Committee and the National Institute of Standards 
     and Technology, and after public notice and opportunity for 
     comment, shall develop standards and best practices for 
     calculating, monitoring, and analyzing greenhouse gas 
     intensity.
       ``(i) Demonstration Projects.--
       ``(1) In general.--The Secretary shall, subject to the 
     availability of appropriations, support demonstration 
     projects that--
       ``(A) increase the reduction of the greenhouse gas 
     intensity to levels below that which would be achieved by 
     technologies being used in the United States as of the date 
     of enactment of this section;
       ``(B) maximize the potential return on Federal investment;
       ``(C) demonstrate distinct roles in public-private 
     partnerships;
       ``(D) produce a large-scale reduction of greenhouse gas 
     intensity if commercialization occurred; and
       ``(E) support a diversified portfolio to mitigate the 
     uncertainty associated with a single technology.
       ``(2) Cost sharing.--In supporting a demonstration project 
     under this subsection, the Secretary shall require cost-
     sharing in accordance with section 988 of the Energy Policy 
     Act of 2005.
       ``(3) Authorization of appropriations.--There are 
     authorized to be appropriated such sums as are necessary to 
     carry out this subsection.
       ``(j) Cooperative Research and Development Agreements.--In 
     carrying out greenhouse gas intensity reduction research and 
     technology deployment activities under this subtitle, the 
     Secretary may enter into cooperative research and development 
     agreements under section 12 of the Stevenson-Wydler 
     Technology Innovation Act of 1980 (15 U.S.C. 3710a).''.
    Subtitle B--Climate Change Technology Deployment in Developing 
                               Countries

     SEC. 1611. CLIMATE CHANGE TECHNOLOGY DEPLOYMENT IN DEVELOPING 
                   COUNTRIES.

       The Global Environmental Protection Assistance Act of 1989 
     (Public Law 101-240; 103 Stat. 2521) is amending by adding at 
     the end the following:
        ``PART C--TECHNOLOGY DEPLOYMENT IN DEVELOPING COUNTRIES

     ``SEC. 731. DEFINITIONS.

       ``In this part:
       ``(1) Carbon sequestration.--The term `carbon 
     sequestration' means the capture of carbon dioxide through 
     terrestrial, geological, biological, or other means, which 
     prevents the release of carbon dioxide into the atmosphere.
       ``(2) Greenhouse gas.--The term `greenhouse gas' means 
     carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, 
     perfluorocarbons, and sulfur hexafluoride.
       ``(3) Greenhouse gas intensity.--The term `greenhouse gas 
     intensity' means the ratio of greenhouse gas emissions to 
     economic output.

     ``SEC. 732. REDUCTION OF GREENHOUSE GAS INTENSITY.

       ``(a) Lead Agency.--
       ``(1) In general.--The Department of State shall act as the 
     lead agency for integrating into United States foreign policy 
     the goal of reducing greenhouse gas intensity in developing 
     countries.
       ``(2) Reports.--
       ``(A) Initial report.--Not later than 180 days after the 
     date of enactment of this part, the Secretary of State shall 
     submit to the appropriate authorizing and appropriating 
     committees of Congress an initial report, based on the most 
     recent information available to the Secretary from reliable 
     public sources, that identifies the 25 developing countries 
     that are the largest greenhouse gas emitters, including for 
     each country--
       ``(i) an estimate of the quantity and types of energy used;
       ``(ii) an estimate of the greenhouse gas intensity of the 
     energy, manufacturing, agricultural, and transportation 
     sectors;
       ``(iii) a description the progress of any significant 
     projects undertaken to reduce greenhouse gas intensity;
       ``(iv) a description of the potential for undertaking 
     projects to reduce greenhouse gas intensity;
       ``(v) a description of any obstacles to the reduction of 
     greenhouse gas intensity; and
       ``(vi) a description of the best practices learned by the 
     Agency for International Development from conducting previous 
     pilot and demonstration projects to reduce greenhouse gas 
     intensity.
       ``(B) Update.--Not later than 18 months after the date on 
     which the initial report is submitted under subparagraph (A), 
     the Secretary shall submit to the appropriate authorizing and 
     appropriating committees of Congress, based on the best 
     information available to the Secretary, an update of the 
     information provided in the initial report.
       ``(C) Use.--
       ``(i) Initial report.--The Secretary of State shall use the 
     initial report submitted under subparagraph (A) to establish 
     baselines for the developing countries identified in the 
     report with respect to the information provided under clauses 
     (i) and (ii) of that subparagraph.
       ``(ii) Annual reports.--The Secretary of State shall use 
     the annual reports prepared under subparagraph (B) and any 
     other information available to the Secretary to track the 
     progress of the developing countries with respect to reducing 
     greenhouse gas intensity.
       ``(b) Projects.--The Secretary of State, in coordination 
     with Administrator of the United States Agency for 
     International Development, shall (directly or through 
     agreements with the World Bank, the International Monetary 
     Fund, the Overseas Private Investment Corporation, and other 
     development institutions) provide assistance to developing 
     countries specifically for projects to reduce greenhouse gas 
     intensity, including projects to--
       ``(1) leverage, through bilateral agreements, funds for 
     reduction of greenhouse gas intensity;
       ``(2) increase private investment in projects and 
     activities to reduce greenhouse gas intensity; and
       ``(3) expedite the deployment of technology to reduce 
     greenhouse gas intensity.
       ``(c) Focus.--In providing assistance under subsection (b), 
     the Secretary of State shall focus on--
       ``(1) promoting the rule of law, property rights, contract 
     protection, and economic freedom; and
       ``(2) increasing capacity, infrastructure, and training.
       ``(d) Priority.--In providing assistance under subsection 
     (b), the Secretary of State shall give priority to projects 
     in the 25 developing countries identified in the report 
     submitted under subsection (a)(2)(A).

[[Page 17935]]



     ``SEC. 733. TECHNOLOGY INVENTORY FOR DEVELOPING COUNTRIES.

       ``(a) In General.--The Secretary of Energy, in coordination 
     with the Secretary of State and the Secretary of Commerce, 
     shall conduct an inventory of greenhouse gas intensity 
     reducing technologies that are developed, or under 
     development in the United States, to identify technologies 
     that are suitable for transfer to, deployment in, and 
     commercialization in the developing countries identified in 
     the report submitted under section 732(a)(2)(A).
       ``(b) Report.--Not later than 180 days after the completion 
     of the inventory under subsection (a), the Secretary of State 
     and the Secretary of Energy shall jointly submit to Congress 
     a report that--
       ``(1) includes the results of the completed inventory;
       ``(2) identifies obstacles to the transfer, deployment, and 
     commercialization of the inventoried technologies;
       ``(3) includes results from previous Federal reports 
     related to the inventoried technologies; and
       ``(4) includes an analysis of market forces related to the 
     inventoried technologies.

     ``SEC. 734. TRADE-RELATED BARRIERS TO EXPORT OF GREENHOUSE 
                   GAS INTENSITY REDUCING TECHNOLOGIES.

       ``(a) In General.--Not later than 1 year after the date of 
     enactment of this part, the United States Trade 
     Representative shall (as appropriate and consistent with 
     applicable bilateral, regional, and mutual trade 
     agreements)--
       ``(1) identify trade-relations barriers maintained by 
     foreign countries to the export of greenhouse gas intensity 
     reducing technologies and practices from the United States to 
     the developing countries identified in the report submitted 
     under section 732(a)(2)(A); and
       ``(2) negotiate with foreign countries for the removal of 
     those barriers.
       ``(b) Annual Report.--Not later than 1 year after the date 
     on which a report is submitted under subsection (a)(1) and 
     annually thereafter, the United States Trade Representative 
     shall submit to Congress a report that describes any progress 
     made with respect to removing the barriers identified by the 
     United States Trade Representative under subsection (a)(1).

     ``SEC. 735. GREENHOUSE GAS INTENSITY REDUCING TECHNOLOGY 
                   EXPORT INITIATIVE.

       ``(a) In General.--There is established an interagency 
     working group to carry out a Greenhouse Gas Intensity 
     Reducing Technology Export Initiative to--
       ``(1) promote the export of greenhouse gas intensity 
     reducing technologies and practices from the United States;
       ``(2) identify developing countries that should be 
     designated as priority countries for the purpose of exporting 
     greenhouse gas intensity reducing technologies and practices, 
     based on the report submitted under section 732(a)(2)(A);
       ``(3) identify potential barriers to adoption of exported 
     greenhouse gas intensity reducing technologies and practices 
     based on the reports submitted under section 734; and
       ``(4) identify previous efforts to export energy 
     technologies to learn best practices.
       ``(b) Composition.--The working group shall be composed 
     of--
       ``(1) the Secretary of State, who shall act as the head of 
     the working group;
       ``(2) the Administrator of the United States Agency for 
     International Development;
       ``(3) the United States Trade Representative;
       ``(4) a designee of the Secretary of Energy;
       ``(5) a designee of the Secretary of Commerce; and
       ``(6) a designee of the Administrator of the Environmental 
     Protection Agency.
       ``(c) Performance Reviews and Reports.--Not later than 180 
     days after the date of enactment of this part and each year 
     thereafter, the interagency working group shall--
       ``(1) conduct a performance review of actions taken and 
     results achieved by the Federal Government (including each of 
     the agencies represented on the interagency working group) to 
     promote the export of greenhouse gas intensity reducing 
     technologies and practices from the United States; and
       ``(2) submit to the appropriate authorizing and 
     appropriating committees of Congress a report that describes 
     the results of the performance reviews and evaluates progress 
     in promoting the export of greenhouse gas intensity reducing 
     technologies and practices from the United States, including 
     any recommendations for increasing the export of the 
     technologies and practices.

     ``SEC. 736. TECHNOLOGY DEMONSTRATION PROJECTS.

       ``(a) In General.--The Secretary of State, in coordination 
     with the Secretary of Energy and the Administrator of the 
     United States Agency for International Development, shall 
     promote the adoption of technologies and practices that 
     reduce greenhouse gas intensity in developing countries in 
     accordance with this section.
       ``(b) Demonstration Projects.--
       ``(1) In general.--The Secretaries and the Administrator 
     shall plan, coordinate, and carry out, or provide assistance 
     for the planning, coordination, or carrying out of, 
     demonstration projects under this section in at least 10 
     eligible countries, as determined by the Secretaries and the 
     Administrator.
       ``(2) Eligibility.--A country shall be eligible for 
     assistance under this subsection if the Secretaries and the 
     Administrator determine that the country has demonstrated a 
     commitment to--
       ``(A) just governance, including--
       ``(i) promoting the rule of law;
       ``(ii) respecting human and civil rights;
       ``(iii) protecting private property rights; and
       ``(iv) combating corruption; and
       ``(B) economic freedom, including economic policies that--
       ``(i) encourage citizens and firms to participate in global 
     trade and international capital markets;
       ``(ii) promote private sector growth and the sustainable 
     management of natural resources; and
       ``(iii) strengthen market forces in the economy.
       ``(3) Selection.--In determining which eligible countries 
     to provide assistance to under paragraph (1), the Secretaries 
     and the Administrator shall consider--
       ``(A) the opportunity to reduce greenhouse gas intensity in 
     the eligible country; and
       ``(B) the opportunity to generate economic growth in the 
     eligible country.
       ``(4) Types of projects.--Demonstration projects under this 
     section may include--
       ``(A) coal gasification, coal liquefaction, and clean coal 
     projects;
       ``(B) carbon sequestration projects;
       ``(C) cogeneration technology initiatives;
       ``(D) renewable projects; and
       ``(E) lower emission transportation.

     ``SEC. 737. FELLOWSHIP AND EXCHANGE PROGRAMS.

       ``The Secretary of State, in coordination with the 
     Secretary of Energy, the Secretary of Commerce, and the 
     Administrator of the Environmental Protection Agency, shall 
     carry out fellowship and exchange programs under which 
     officials from developing countries visit the United States 
     to acquire expertise and knowledge of best practices to 
     reduce greenhouse gas intensity in their countries.

     ``SEC. 738. AUTHORIZATION OF APPROPRIATIONS.

       ``There are authorized to be appropriated such sums as are 
     necessary to carry out this part.

     ``SEC. 739. EFFECTIVE DATE.

       ``Except as otherwise provided in this part, this part 
     takes effect on October 1, 2005.''.
           TITLE XVII--INCENTIVES FOR INNOVATIVE TECHNOLOGIES

     SEC. 1701. DEFINITIONS.

       In this title:
       (1) Commercial technology.--
       (A) In general.--The term ``commercial technology'' means a 
     technology in general use in the commercial marketplace.
       (B) Inclusions.--The term ``commercial technology'' does 
     not include a technology solely by use of the technology in a 
     demonstration project funded by the Department.
       (2) Cost.--The term ``cost'' has the meaning given the term 
     ``cost of a loan guarantee'' within the meaning of section 
     502(5)(C) of the Federal Credit Reform Act of 1990 (2 U.S.C. 
     661a(5)(C)).
       (3) Eligible project.--The term ``eligible project'' means 
     a project described in section 1703.
       (4) Guarantee.--
       (A) In general.--The term ``guarantee'' has the meaning 
     given the term ``loan guarantee'' in section 502 of the 
     Federal Credit Reform Act of 1990 (2 U.S.C. 661a).
       (B) Inclusion.--The term ``guarantee'' includes a loan 
     guarantee commitment (as defined in section 502 of the 
     Federal Credit Reform Act of 1990 (2 U.S.C. 661a)).
       (5) Obligation.--The term ``obligation'' means the loan or 
     other debt obligation that is guaranteed under this section.

     SEC. 1702. TERMS AND CONDITIONS.

       (a) In General.--Except for division C of Public Law 108-
     324, the Secretary shall make guarantees under this or any 
     other Act for projects on such terms and conditions as the 
     Secretary determines, after consultation with the Secretary 
     of the Treasury, only in accordance with this section.
       (b) Specific Appropriation or Contribution.--No guarantee 
     shall be made unless--
       (1) an appropriation for the cost has been made; or
       (2) the Secretary has received from the borrower a payment 
     in full for the cost of the obligation and deposited the 
     payment into the Treasury.
       (c) Amount.--Unless otherwise provided by law, a guarantee 
     by the Secretary shall not exceed an amount equal to 80 
     percent of the project cost of the facility that is the 
     subject of the guarantee, as estimated at the time at which 
     the guarantee is issued.
       (d) Repayment.--
       (1) In general.--No guarantee shall be made unless the 
     Secretary determines that there is reasonable prospect of 
     repayment of the principal and interest on the obligation by 
     the borrower.
       (2) Amount.--No guarantee shall be made unless the 
     Secretary determines that the amount of the obligation (when 
     combined with amounts available to the borrower from other 
     sources) will be sufficient to carry out the project.
       (3) Subordination.--The obligation shall be subject to the 
     condition that the obligation is not subordinate to other 
     financing.
       (e) Interest Rate.--An obligation shall bear interest at a 
     rate that does not exceed a level that the Secretary 
     determines appropriate, taking into account the prevailing 
     rate of interest in the private sector for similar loans and 
     risks.
       (f) Term.--The term of an obligation shall require full 
     repayment over a period not to exceed the lesser of--
       (1) 30 years; or
       (2) 90 percent of the projected useful life of the physical 
     asset to be financed by the obligation (as determined by the 
     Secretary).
       (g) Defaults.--

[[Page 17936]]

       (1) Payment by secretary.--
       (A) In general.--If a borrower defaults on the obligation 
     (as defined in regulations promulgated by the Secretary and 
     specified in the guarantee contract), the holder of the 
     guarantee shall have the right to demand payment of the 
     unpaid amount from the Secretary.
       (B) Payment required.--Within such period as may be 
     specified in the guarantee or related agreements, the 
     Secretary shall pay to the holder of the guarantee the unpaid 
     interest on, and unpaid principal of the obligation as to 
     which the borrower has defaulted, unless the Secretary finds 
     that there was no default by the borrower in the payment of 
     interest or principal or that the default has been remedied.
       (C) Forbearance.--Nothing in this subsection precludes any 
     forbearance by the holder of the obligation for the benefit 
     of the borrower which may be agreed upon by the parties to 
     the obligation and approved by the Secretary.
       (2) Subrogation.--
       (A) In general.--If the Secretary makes a payment under 
     paragraph (1), the Secretary shall be subrogated to the 
     rights of the recipient of the payment as specified in the 
     guarantee or related agreements including, where appropriate, 
     the authority (notwithstanding any other provision of law) 
     to--
       (i) complete, maintain, operate, lease, or otherwise 
     dispose of any property acquired pursuant to such guarantee 
     or related agreements; or
       (ii) permit the borrower, pursuant to an agreement with the 
     Secretary, to continue to pursue the purposes of the project 
     if the Secretary determines this to be in the public 
     interest.
       (B) Superiority of rights.--The rights of the Secretary, 
     with respect to any property acquired pursuant to a guarantee 
     or related agreements, shall be superior to the rights of any 
     other person with respect to the property.
       (C) Terms and conditions.--A guarantee agreement shall 
     include such detailed terms and conditions as the Secretary 
     determines appropriate to--
       (i) protect the interests of the United States in the case 
     of default; and
       (ii) have available all the patents and technology 
     necessary for any person selected, including the Secretary, 
     to complete and operate the project.
       (3) Payment of principal and interest by secretary.--With 
     respect to any obligation guaranteed under this section, the 
     Secretary may enter into a contract to pay, and pay, holders 
     of the obligation, for and on behalf of the borrower, from 
     funds appropriated for that purpose, the principal and 
     interest payments which become due and payable on the unpaid 
     balance of the obligation if the Secretary finds that--
       (A)(i) the borrower is unable to meet the payments and is 
     not in default;
       (ii) it is in the public interest to permit the borrower to 
     continue to pursue the purposes of the project; and
       (iii) the probable net benefit to the Federal Government in 
     paying the principal and interest will be greater than that 
     which would result in the event of a default;
       (B) the amount of the payment that the Secretary is 
     authorized to pay shall be no greater than the amount of 
     principal and interest that the borrower is obligated to pay 
     under the agreement being guaranteed; and
       (C) the borrower agrees to reimburse the Secretary for the 
     payment (including interest) on terms and conditions that are 
     satisfactory to the Secretary.
       (4) Action by attorney general.--
       (A) Notification.--If the borrower defaults on an 
     obligation, the Secretary shall notify the Attorney General 
     of the default.
       (B) Recovery.--On notification, the Attorney General shall 
     take such action as is appropriate to recover the unpaid 
     principal and interest due from--
       (i) such assets of the defaulting borrower as are 
     associated with the obligation; or
       (ii) any other security pledged to secure the obligation.
       (h) Fees.--
       (1) In general.--The Secretary shall charge and collect 
     fees for guarantees in amounts the Secretary determines are 
     sufficient to cover applicable administrative expenses.
       (2) Availability.--Fees collected under this subsection 
     shall--
       (A) be deposited by the Secretary into the Treasury; and
       (B) remain available until expended, subject to such other 
     conditions as are contained in annual appropriations Acts.
       (i) Records; Audits.--
       (1) In general.--A recipient of a guarantee shall keep such 
     records and other pertinent documents as the Secretary shall 
     prescribe by regulation, including such records as the 
     Secretary may require to facilitate an effective audit.
       (2) Access.--The Secretary and the Comptroller General of 
     the United States, or their duly authorized representatives, 
     shall have access, for the purpose of audit, to the records 
     and other pertinent documents.
       (j) Full Faith and Credit.--The full faith and credit of 
     the United States is pledged to the payment of all guarantees 
     issued under this section with respect to principal and 
     interest.

     SEC. 1703. ELIGIBLE PROJECTS.

       (a) In General.--The Secretary may make guarantees under 
     this section only for projects that--
       (1) avoid, reduce, or sequester air pollutants or 
     anthropogenic emissions of greenhouse gases; and
       (2) employ new or significantly improved technologies as 
     compared to commercial technologies in service in the United 
     States at the time the guarantee is issued.
       (b) Categories.--Projects from the following categories 
     shall be eligible for a guarantee under this section:
       (1) Renewable energy systems.
       (2) Advanced fossil energy technology (including coal 
     gasification meeting the criteria in subsection (d)).
       (3) Hydrogen fuel cell technology for residential, 
     industrial or -transportation applications.
       (4) Advanced nuclear energy facilities.
       (5) Carbon capture and sequestration practices and 
     technologies, including agricultural and forestry practices 
     that store and sequester carbon.
       (6) Efficient electrical generation, transmission, and 
     distribution technologies.
       (7) Efficient end-use energy technologies.
       (8) Production facilities for fuel efficient vehicles, 
     including hybrid and advanced diesel vehicles.
       (9) Pollution control equipment.
       (10) Refineries, meaning facilities at which crude oil is 
     refined into gasoline.
       (c) Gasification Projects.--The Secretary may make 
     guarantees for the following gasification projects:
       (1) Integrated gasification combined cycle projects.--
     Integrated gasification combined cycle plants meeting the 
     emission levels under subsection (d), including--
       (A) projects for the generation of electricity--
       (i) for which, during the term of the guarantee--

       (I) coal, biomass, petroleum coke, or a combination of 
     coal, biomass, and petroleum coke will account for at least 
     65 percent of annual heat input; and
       (II) electricity will account for at least 65 percent of 
     net useful annual energy output;

       (ii) that have a design that is determined by the Secretary 
     to be capable of accommodating the equipment likely to be 
     necessary to capture the carbon dioxide that would otherwise 
     be emitted in flue gas from the plant;
       (iii) that have an assured revenue stream that covers 
     project capital and operating costs (including servicing all 
     debt obligations covered by the guarantee) that is approved 
     by the Secretary and the relevant State public utility 
     commission; and
       (iv) on which construction commences not later than the 
     date that is 3 years after the date of the issuance of the 
     guarantee;
       (B) a project to produce energy from coal (of not more than 
     13,000 Btu/lb and mined in the western United States) using 
     appropriate advanced integrated gasification combined cycle 
     technology that minimizes and offers the potential to 
     sequester carbon dioxide emissions and that--
       (i) may include repowering of existing facilities;
       (ii) may be built in stages;
       (iii) shall have a combined output of at least 100 
     megawatts;
       (iv) shall be located in a western State at an altitude 
     greater than 4,000 feet; and
       (v) shall demonstrate the ability to use coal with an 
     energy content of not more than 9,000 Btu/lb;
       (C) a project located in a taconite-producing region of the 
     United States that is entitled under the law of the State in 
     which the plant is located to enter into a long-term contract 
     approved by a State public utility commission to sell at 
     least 450 megawatts of output to a utility;
       (D) facilities that--
       (i) generate 1 or more hydrogen-rich and carbon monoxide-
     rich product streams from the gasification of coal or coal 
     waste; and
       (ii) use those streams to facilitate the production of 
     ultra clean premium fuels through the Fischer-Tropsch 
     process; and
       (E) a project to produce energy and clean fuels, using 
     appropriate coal liquefaction technology, from Western 
     bituminous or subbituminous coal, that--
       (i) is owned by a State government; and
       (ii) may include tribal and private coal resources.
       (2) Industrial gasification projects.--Facilities that 
     gasify coal, biomass, or petroleum coke in any combination to 
     produce synthesis gas for use as a fuel or feedstock and for 
     which electricity accounts for less than 65 percent of the 
     useful energy output of the facility.
       (3) Petroleum coke gasification projects.--The Secretary is 
     encouraged to make loan guarantees under this title available 
     for petroleum coke gasification projects.
       (4) Liquifaction project.--Notwithstanding any other 
     provision of law, funds awarded under the clean coal power 
     initiative under subtitle A of title IV for coal-to-oil 
     liquefaction projects may be used to finance the cost of loan 
     guarantees for projects awarded such funds.
       (d) Emission Levels.--In addition to any other applicable 
     Federal or State emission limitation requirements, a project 
     shall attain at least--
       (1) total sulfur dioxide emissions in flue gas from the 
     project that do not exceed 0.05 lb/mmBTU;
       (2) a 90-percent removal rate (including any fuel 
     pretreatment) of mercury from the coal-derived gas, and any 
     other fuel, combusted by the project;
       (3) total nitrogen oxide emissions in the flue gas from the 
     project that do not exceed 0.08 lb/mmBTU; and
       (4) total particulate emissions in the flue gas from the 
     project that do not exceed 0.01 lb/mmBTU.
       (e) Qualification of Facilities Receiving Tax Credits.--A 
     project that receives tax credits for clean coal technology 
     shall not be disqualified from receiving a guarantee under 
     this title.

[[Page 17937]]



     SEC. 1704. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--There are authorized to be appropriated 
     such sums as are necessary to provide the cost of guarantees 
     under this title.
       (b) Use of Other Appropriated Funds.--The Department may 
     use amounts awarded under the clean coal power initiative 
     under subtitle A of title IV to carry out the project 
     described in section 1703(c)(1)(C), on the request of the 
     recipient of such award, for a loan guarantee, to the extent 
     that the amounts have not yet been disbursed to, or have been 
     repaid by, the recipient.
                          TITLE XVIII--STUDIES

     SEC. 1801. STUDY ON INVENTORY OF PETROLEUM AND NATURAL GAS 
                   STORAGE.

       (a) Definition.--For purposes of this section ``petroleum'' 
     means crude oil, motor gasoline, jet fuel, distillates, and 
     propane.
       (b) Study.--The Secretary shall conduct a study on 
     petroleum and natural gas storage capacity and operational 
     inventory levels, nationwide and by major geographical 
     regions.
       (c) Contents.--The study shall address--
       (1) historical normal ranges for petroleum and natural gas 
     inventory levels;
       (2) historical and projected storage capacity trends;
       (3) estimated operation inventory levels below which 
     outages, delivery slowdown, rationing, interruptions in 
     service, or other indicators of shortage begin to appear;
       (4) explanations for inventory levels dropping below normal 
     ranges; and
       (5) the ability of industry to meet United States demand 
     for petroleum and natural gas without shortages or price 
     spikes, when inventory levels are below normal ranges.
       (d) Report to Congress.--Not later than 1 year after the 
     date of enactment of this Act, the Secretary shall submit a 
     report to Congress on the results of the study, including 
     findings and any recommendations for preventing future supply 
     shortages.

     SEC. 1802. STUDY OF ENERGY EFFICIENCY STANDARDS.

       The Secretary shall contract with the National Academy of 
     Sciences for a study, to be completed within 1 year after the 
     date of enactment of this Act, to examine whether the goals 
     of energy efficiency standards are best served by measurement 
     of energy consumed, and efficiency improvements, at the 
     actual site of energy consumption, or through the full fuel 
     cycle, beginning at the source of energy production. The 
     Secretary shall submit the report to Congress.

     SEC. 1803. TELECOMMUTING STUDY.

       (a) Study Required.--The Secretary, in consultation with 
     the Commission, the Director of the Office of Personnel 
     Management, the Administrator of General Services, and the 
     Administrator of NTIA, shall conduct a study of the energy 
     conservation implications of the widespread adoption of 
     telecommuting by Federal employees in the United States.
       (b) Required Subjects of Study.--The study required by 
     subsection (a) shall analyze the following subjects in 
     relation to the energy saving potential of telecommuting by 
     Federal employees:
       (1) Reductions of energy use and energy costs in commuting 
     and regular office heating, cooling, and other operations.
       (2) Other energy reductions accomplished by telecommuting.
       (3) Existing regulatory barriers that hamper telecommuting, 
     including barriers to broadband telecommunications services 
     deployment.
       (4) Collateral benefits to the environment, family life, 
     and other values.
       (c) Report Required.--The Secretary shall submit to the 
     President and Congress a report on the study required by this 
     section not later than 6 months after the date of enactment 
     of this Act. Such report shall include a description of the 
     results of the analysis of each of the subject described in 
     subsection (b).
       (d) Definitions.--As used in this section:
       (1) Commission.--The term ``Commission'' means the Federal 
     Communications Commission.
       (2) NTIA.--The term ``NTIA'' means the National 
     Telecommunications and Information Administration of the 
     Department of Commerce.
       (3) Telecommuting.--The term ``telecommuting'' means the 
     performance of work functions using communications 
     technologies, thereby eliminating or substantially reducing 
     the need to commute to and from traditional worksites.
       (4) Federal employee.--The term ``Federal employee'' has 
     the meaning provided the term ``employee'' by section 2105 of 
     title 5, United States Code.

     SEC. 1804. LIHEAP REPORT.

       Not later than 1 year after the date of enactment of this 
     Act, the Secretary of Health and Human Services shall 
     transmit to Congress a report on how the Low-Income Home 
     Energy Assistance Program could be used more effectively to 
     prevent loss of life from extreme temperatures. In preparing 
     such report, the Secretary shall consult with appropriate 
     officials in all 50 States and the District of Columbia.

     SEC. 1805. OIL BYPASS FILTRATION TECHNOLOGY.

       The Secretary and the Administrator of the Environmental 
     Protection Agency shall--
       (1) conduct a joint study of the benefits of oil bypass 
     filtration technology in reducing demand for oil and 
     protecting the environment;
       (2) examine the feasibility of using oil bypass filtration 
     technology in Federal motor vehicle fleets; and
       (3) include in such study, prior to any determination of 
     the feasibility of using oil bypass filtration technology, 
     the evaluation of products and various manufacturers.

     SEC. 1806. TOTAL INTEGRATED THERMAL SYSTEMS.

       The Secretary shall--
       (1) conduct a study of the benefits of total integrated 
     thermal systems in reducing demand for oil and protecting the 
     environment; and
       (2) examine the feasibility of using total integrated 
     thermal systems in Department of Defense and other Federal 
     motor vehicle fleets.

     SEC. 1807. REPORT ON ENERGY INTEGRATION WITH LATIN AMERICA.

       The Secretary shall submit an annual report to the 
     Committee on Energy and Commerce of the United States House 
     of Representatives and to the Committee on Energy and Natural 
     Resources of the United States Senate concerning the status 
     of energy export development in Latin America and efforts by 
     the Secretary and other departments and agencies of the 
     United States to promote energy integration with Latin 
     America. The report shall contain a detailed analysis of the 
     status of energy export development in Mexico and a 
     description of all significant efforts by the Secretary and 
     other departments and agencies to promote a constructive 
     relationship with Mexico regarding the development of that 
     nation's energy capacity. In particular this report shall 
     outline efforts the Secretary and other departments and 
     agencies have made to ensure that regulatory approval and 
     oversight of United States/Mexico border projects that result 
     in the expansion of Mexican energy capacity are effectively 
     coordinated across departments and with the Mexican 
     government.

     SEC. 1808. LOW-VOLUME GAS RESERVOIR STUDY.

       (a) Study.--The Secretary shall make a grant to an 
     organization of oil and gas producing States, specifically 
     those containing significant numbers of marginal oil and 
     natural gas wells, for conducting an annual study of low-
     volume natural gas reservoirs. Such organization shall work 
     with the State geologist of each State being studied.
       (b) Contents.--The studies under this section shall--
       (1) determine the status and location of marginal wells and 
     gas reservoirs;
       (2) gather the production information of these marginal 
     wells and reservoirs;
       (3) estimate the remaining producible reserves based on 
     variable pipeline pressures;
       (4) locate low-pressure gathering facilities and pipelines;
       (5) recommend incentives which will enable the continued 
     production of these resources;
       (6) produce maps and literature to disseminate to States to 
     promote conservation of natural gas reserves; and
       (7) evaluate the amount of natural gas that is being wasted 
     through the practice of venting or flaring of natural gas 
     produced in association with crude oil well production.
       (c) Data Analysis.--Data development and analysis under 
     this section shall be performed by an institution of higher 
     education with GIS capabilities. If the organization 
     receiving the grant under subsection (a) does not have GIS 
     capabilities, such organization shall contract with one or 
     more entities with--
       (1) technological capabilities and resources to perform 
     advanced image processing, GIS programming, and data 
     analysis; and
       (2) the ability to--
       (A) process remotely sensed imagery with high spatial 
     resolution;
       (B) deploy global positioning systems;
       (C) process and synthesize existing, variable-format gas 
     well, pipeline, gathering facility, and reservoir data;
       (D) create and query GIS databases with infrastructure 
     location and attribute information;
       (E) write computer programs to customize relevant GIS 
     software;
       (F) generate maps, charts, and graphs which summarize 
     findings from data research for presentation to different 
     audiences; and
       (G) deliver data in a variety of formats, including 
     Internet Map Server for query and display, desktop computer 
     display, and access through handheld personal digital 
     assistants.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary for carrying out this 
     section--
       (1) $1,500,000 for fiscal year 2006; and
       (2) $450,000 for each of the fiscal years 2007 through 
     2010.
       (e) Definitions.--For purposes of this section, the term 
     ``GIS'' means geographic information systems technology that 
     facilitates the organization and management of data with a 
     geographic component.

     SEC. 1809. INVESTIGATION OF GASOLINE PRICES.

       (a) Investigation.--Not later than 90 days after the date 
     of enactment of this Act, the Federal Trade Commission shall 
     conduct an investigation to determine if the price of 
     gasoline is being artificially manipulated by reducing 
     refinery capacity or by any other form of market manipulation 
     or price gouging practices.
       (b) Evaluation and Analysis.--The Secretary shall direct 
     the National Petroleum Council to conduct an evaluation and 
     analysis to determine whether, and to what extent, 
     environmental and other regulations affect new domestic 
     refinery construction and significant expansion of existing 
     refinery capacity.
       (c) Reports to Congress.--
       (1) Investigation.--On completion of the investigation 
     under subsection (a), the Federal Trade Commission shall 
     submit to Congress a report that describes--
       (A) the results of the investigation; and
       (B) any recommendations of the Federal Trade Commission.

[[Page 17938]]

       (2) Evaluation and analysis.--On completion of the 
     evaluation and analysis under subsection (b), the Secretary 
     shall submit to Congress a report that describes--
       (A) the results of the evaluation and analysis; and
       (B) any recommendations of the National Petroleum Council.

     SEC. 1810. ALASKA NATURAL GAS PIPELINE.

       Not later than 180 days after the date of enactment of this 
     Act, and every 180 days thereafter until the Alaska natural 
     gas pipeline commences operation, the Federal Energy 
     Regulatory Commission shall submit to Congress a report 
     describing--
       (1) the progress made in licensing and constructing the 
     pipeline; and
       (2) any issue impeding that progress.

     SEC. 1811. COAL BED METHANE STUDY.

       (a) Study.--
       (1) In general.--The Secretary of the Interior, in 
     consultation with the Administrator of the Environmental 
     Protection Agency, shall enter into an arrangement under 
     which the National Academy of Sciences shall conduct a study 
     on the effect of coalbed natural gas production on surface 
     and ground water resources, including ground water aquifiers, 
     in the States of Montana, Wyoming, Colorado, New Mexico, 
     North Dakota, and Utah.
       (2) Matters to be addressed.--The study shall address the 
     effectiveness of--
       (A) the management of coal bed methane produced water;
       (B) the use of best management practices; and
       (C) various production techniques for coal bed methane 
     natural gas in minimizing impacts on water resources.
       (b) Data Analysis.--The study shall analyze available 
     hydrologic, geologic and water quality data, along with--
       (1) production techniques, produced water management 
     techniques, best management practices, and other factors that 
     can mitigate effects of coal bed methane development;
       (2) the costs associated with mitigation techniques;
       (3) effects on surface or ground water resources, including 
     drinking water, associated with surface or subsurface 
     disposal of waters produced during extraction of coal bed 
     methane; and
       (4) any other significant effects on surface or ground 
     water resources associated with production of coal-bed 
     methane.
       (c) Recommendations.--The study shall analyze the 
     effectiveness of current mitigation practices of coal bed 
     methane produced water handling in relation to existing 
     Federal and State laws and regulations, and make 
     recommendations as to changes, if any, to Federal law 
     necessary to address adverse impacts to surface or ground 
     water resources associated with coal bed methane development.
       (d) Completion of Study.--The National Academy of Sciences 
     shall submit the findings and recommendations of the study to 
     the Secretary of the Interior and the Administrator of the 
     Environmental Protection Agency within 12 months after the 
     date of enactment of this Act, and shall upon completion make 
     the results of the study available to the public.
       (e) Report to Congress.--The Secretary of the Interior and 
     the Administrator of the Environmental Protection Agency, 
     after consulting with States, shall report to the Congress 
     within 6 months after receiving the results of the study on--
       (1) the findings and recommendations of the study;
       (2) the agreement or disagreement of the Secretary of the 
     Interior and the Administrator of the Environmental 
     Protection Agency with each of its findings and 
     recommendations; and
       (3) any recommended changes in funding to address the 
     effects of coal bed methane production on surface and ground 
     water resources.

     SEC. 1812. BACKUP FUEL CAPABILITY STUDY.

       (a) Study.--
       (1) In general.--The Secretary shall conduct a study of the 
     effect of obtaining and maintaining liquid and other fuel 
     backup capability at--
       (A) gas-fired power generation facilities; and
       (B) other gas-fired industrial facilities.
       (2) Contents.--The study under paragraph (1) shall 
     address--
       (A) the costs and benefits of adding a different fuel 
     capability to a power gas-fired power generating or 
     industrial facility, taking into consideration regional 
     differences;
       (B) methods of the Federal Government and State governments 
     to encourage gas-fired power generators and industries to 
     develop the capability to power the facilities using a backup 
     fuel;
       (C) the effect on the supply and cost of natural gas of--
       (i) a balanced portfolio of fuel choices in power 
     generation and industrial applications; and
       (ii) State regulations that permit agencies in the State to 
     carry out policies that encourage the use of other backup 
     fuels in gas-fired power generation; and
       (D) changes required in the Clean Air Act (42 U.S.C. 7401 
     et seq.) to allow natural gas generators to add clean backup 
     fuel capabilities.
       (b) Report to Congress.--Not later than 1 year after the 
     date of enactment of this Act, the Secretary shall submit to 
     Congress a report on the results of the study under 
     subsection (a), including recommendations regarding future 
     activity of the Federal Government relating to backup fuel 
     capability.

     SEC. 1813. INDIAN LAND RIGHTS-OF-WAY.

       (a) Study.--
       (1) In general.--The Secretary and the Secretary of the 
     Interior (referred to in this section as the ``Secretaries'') 
     shall jointly conduct a study of issues regarding energy 
     rights-of-way on tribal land (as defined in section 2601 of 
     the Energy Policy Act of 1992 (as amended by section 503)) 
     (referred to in this section as ``tribal land'').
       (2) Consultation.--In conducting the study under paragraph 
     (1), the Secretaries shall consult with Indian tribes, the 
     energy industry, appropriate governmental entities, and 
     affected businesses and consumers.
       (b) Report.--Not later than 1 year after the date of 
     enactment of this Act, the Secretaries shall submit to 
     Congress a report on the findings of the study, including--
       (1) an analysis of historic rates of compensation paid for 
     energy rights-of-way on tribal land;
       (2) recommendations for appropriate standards and 
     procedures for determining fair and appropriate compensation 
     to Indian tribes for grants, expansions, and renewals of 
     energy rights-of-way on tribal land;
       (3) an assessment of the tribal self-determination and 
     sovereignty interests implicated by applications for the 
     grant, expansion, or renewal of energy rights-of-way on 
     tribal land; and
       (4) an analysis of relevant national energy transportation 
     policies relating to grants, expansions, and renewals of 
     energy rights-of-way on tribal land.

     SEC. 1814. MOBILITY OF SCIENTIFIC AND TECHNICAL PERSONNEL.

       Not later than 2 years after the date of enactment of this 
     section, the Secretary shall transmit to Congress a report 
     that--
       (1) identifies any policies or procedures of a contractor 
     operating a National Laboratory or single-purpose research 
     facility that create disincentives to the temporary or 
     permanent transfer of scientific and technical personnel 
     among the contractor-operated National Laboratories or 
     contractor-operated single-purpose research facilities; and
       (2) provides recommendations for improving interlaboratory 
     exchange of scientific and technical personnel.

     SEC. 1815. INTERAGENCY REVIEW OF COMPETITION IN THE WHOLESALE 
                   AND RETAIL MARKETS FOR ELECTRIC ENERGY.

       (a) Task Force.--There is established an inter-agency task 
     force, to be known as the ``Electric Energy Market 
     Competition Task Force'' (referred to in this section as the 
     ``task force''), consisting of 5 members--
       (1) 1 of whom shall be an employee of the Department of 
     Justice, to be appointed by the Attorney General of the 
     United States;
       (2) 1 of whom shall be an employee of the Federal Energy 
     Regulatory Commission, to be appointed by the Chairperson of 
     that Commission;
       (3) 1 of whom shall be an employee of the Federal Trade 
     Commission, to be appointed by the Chairperson of that 
     Commission;
       (4) 1 of whom shall be an employee of the Department, to be 
     appointed by the Secretary; and
       (5) 1 of whom shall be an employee of the Rural Utilities 
     Service, to be appointed by the Secretary of Agriculture.
       (b) Study and Report.--
       (1) Study.--The task force shall conduct a study and 
     analysis of competition within the wholesale and retail 
     market for electric energy in the United States.
       (2) Report.--
       (A) Final report.--Not later than 1 year after the date of 
     enactment of this Act, the task force shall submit to 
     Congress a final report on the findings of the task force 
     under paragraph (1).
       (B) Public comment.--Not later than the date that is 60 
     days before a final report is submitted to Congress under 
     subparagraph (A), the task force shall--
       (i) publish in the Federal Register a draft of the report; 
     and
       (ii) provide an opportunity for public comment on the 
     report.
       (c) Consultation.--In conducting the study under subsection 
     (b), the task force shall consult with and solicit comments 
     from any advisory entity of the task force, the States, 
     representatives of the electric power industry, and the 
     public.

     SEC. 1816. STUDY OF RAPID ELECTRICAL GRID RESTORATION.

       (a) Study.--
       (1) In general.--The Secretary shall conduct a study of the 
     benefits of using mobile transformers and mobile substations 
     to rapidly restore electrical service to areas subjected to 
     blackouts as a result of--
       (A) equipment failure;
       (B) natural disasters;
       (C) acts of terrorism; or
       (D) war.
       (2) Contents.--The study under paragraph (1) shall contain 
     an analysis of--
       (A) the feasibility of using mobile transformers and mobile 
     substations to reduce dependence on foreign entities for key 
     elements of the electrical grid system of the United States;
       (B) the feasibility of using mobile transformers and mobile 
     substations to rapidly restore electrical power to--
       (i) military bases;
       (ii) the Federal Government;
       (iii) communications industries;
       (iv) first responders; and
       (v) other critical infrastructures, as determined by the 
     Secretary;
       (C) the quantity of mobile transformers and mobile 
     substations necessary--
       (i) to eliminate dependence on foreign sources for key 
     electrical grid components in the United States;

[[Page 17939]]

       (ii) to rapidly deploy technology to fully restore full 
     electrical service to prioritized Governmental functions; and
       (iii) to identify manufacturing sources in existence on the 
     date of enactment of this Act that have previously 
     manufactured specialized mobile transformer or mobile 
     substation products for Federal agencies.
       (b) Report.--
       (1) In general.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary shall submit to the 
     President and Congress a report on the study under subsection 
     (a).
       (2) Inclusion.--The report shall include a description of 
     the results of the analysis under subsection (a)(2).

     SEC. 1817. STUDY OF DISTRIBUTED GENERATION.

       (a) Study.--
       (1) In general.--
       (A) Potential benefits.--The Secretary, in consultation 
     with the Federal Energy Regulatory Commission, shall conduct 
     a study of the potential benefits of cogeneration and small 
     power production.
       (B) Recipients.--The benefits described in subparagraph (A) 
     include benefits that are received directly or indirectly 
     by--
       (i) an electricity distribution or transmission service 
     provider;
       (ii) other customers served by an electricity distribution 
     or transmission service provider; and
       (iii) the general public in the area served by the public 
     utility in which the cogenerator or small power producer is 
     located.
       (2) Inclusions.--The study shall include an analysis of--
       (A) the potential benefits of--
       (i) increased system reliability;
       (ii) improved power quality;
       (iii) the provision of ancillary services;
       (iv) reduction of peak power requirements through onsite 
     generation;
       (v) the provision of reactive power or volt-ampere 
     reactives;
       (vi) an emergency supply of power;
       (vii) offsets to investments in generation, transmission, 
     or distribution facilities that would otherwise be recovered 
     through rates;
       (viii) diminished land use effects and right-of-way 
     acquisition costs; and
       (ix) reducing the vulnerability of a system to terrorism; 
     and
       (B) any rate-related issue that may impede or otherwise 
     discourage the expansion of cogeneration and small power 
     production facilities, including a review of whether rates, 
     rules, or other requirements imposed on the facilities are 
     comparable to rates imposed on customers of the same class 
     that do not have cogeneration or small power production.
       (3) Valuation of benefits.--In carrying out the study, the 
     Secretary shall determine an appropriate method of valuing 
     potential benefits under varying circumstances for individual 
     cogeneration or small power production units.
       (b) Report.--Not later than 18 months after the date of 
     enactment of this Act, the Secretary shall--
       (1) complete the study;
       (2) provide an opportunity for public comment on the 
     results of the study; and
       (3) submit to the President and Congress a report 
     describing--
       (A) the results of the study; and
       (B) information relating to the public comments received 
     under paragraph (2).
       (c) Publication.--After submission of the report under 
     subsection (b) to the President and Congress, the Secretary 
     shall publish the report.

     SEC. 1818. NATURAL GAS SUPPLY SHORTAGE REPORT.

       (a) In General.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     a report on natural gas supplies and demand.
       (b) Purpose.--The purpose of the report under subsection 
     (a) is to develop recommendations for achieving a balance 
     between natural gas supply and demand in order to--
       (1) provide residential consumers with natural gas at 
     reasonable and stable prices;
       (2) accommodate long-term maintenance and growth of 
     domestic natural gas-dependent industrial, manufacturing, and 
     commercial enterprises;
       (3) facilitate the attainment of national ambient air 
     quality standards under the Clean Air Act (43 U.S.C. 7401 et 
     seq.);
       (4) achieve continued progress in reducing the emissions 
     associated with electric power generation; and
       (5) support the development of the preliminary phases of 
     hydrogen-based energy technologies.
       (c) Comprehensive Analysis.--The report shall include a 
     comprehensive analysis of, for the period beginning on 
     January 1, 2004, and ending on December 31, 2015, natural gas 
     supply and demand in the United States, including--
       (1) estimates of annual domestic demand for natural gas, 
     taking into consideration the effect of Federal policies and 
     actions that are likely to increase or decrease the demand 
     for natural gas;
       (2) projections of annual natural gas supplies, from 
     domestic and foreign sources, under Federal policies in 
     existence on the date of enactment of this Act;
       (3) an identification of estimated natural gas supplies 
     that are not available under those Federal policies;
       (4) scenarios for decreasing natural gas demand and 
     increasing natural gas supplies that compare the relative 
     economic and environmental impacts of Federal policies that--
       (A) encourage or require the use of natural gas to meet air 
     quality, carbon dioxide emission reduction, or energy 
     security goals;
       (B) encourage or require the use of energy sources other 
     than natural gas, including coal, nuclear, and renewable 
     sources;
       (C) support technologies to develop alternative sources of 
     natural gas and synthetic gas, including coal gasification 
     technologies;
       (D) encourage or require the use of energy conservation and 
     demand side management practices; and
       (E) affect access to domestic natural gas supplies; and
       (5) recommendations for Federal actions to achieve the 
     purposes described in subsection (b), including 
     recommendations that--
       (A) encourage or require the use of energy sources other 
     than natural gas, including coal, nuclear, and renewable 
     sources;
       (B) encourage or require the use of energy conservation or 
     demand side management practices;
       (C) support technologies for the development of alternative 
     sources of natural gas and synthetic gas, including coal 
     gasification technologies; and
       (D) would improve access to domestic natural gas supplies.
       (d) Consultation.--In preparing the report under subsection 
     (a), the Secretary shall consult with--
       (1) experts in natural gas supply and demand; and
       (2) representatives of--
       (A) State and local governments;
       (B) tribal organizations; and
       (C) consumer and other organizations.
       (e) Hearings.--In preparing the report under subsection 
     (a), the Secretary may hold public hearings and provide other 
     opportunities for public comment, as the Secretary considers 
     appropriate.

     SEC. 1819. HYDROGEN PARTICIPATION STUDY.

       Not later than 1 year after the date of enactment of this 
     Act, the Secretary shall submit to Congress a report 
     evaluating methodologies to ensure the widest participation 
     practicable in setting goals and milestones under the 
     hydrogen program of the Department, including international 
     participants.

     SEC. 1820. OVERALL EMPLOYMENT IN A HYDROGEN ECONOMY.

       (a) Study.--
       (1) In general.--The Secretary shall carry out a study of 
     the likely effects of a transition to a hydrogen economy on 
     overall employment in the United States.
       (2) Contents.--In completing the study, the Secretary shall 
     take into consideration--
       (A) the replacement effects of new goods and services;
       (B) international competition;
       (C) workforce training requirements;
       (D) multiple possible fuel cycles, including usage of raw 
     materials;
       (E) rates of market penetration of technologies; and
       (F) regional variations based on geography.
       (b) Report.--Not later than 18 months after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     a report describing the findings, conclusions, and 
     recommendations of the study under subsection (a).

     SEC. 1821. STUDY OF BEST MANAGEMENT PRACTICES FOR ENERGY 
                   RESEARCH AND DEVELOPMENT PROGRAMS.

       (a) In General.--The Secretary shall enter into an 
     arrangement with the National Academy of Public 
     Administration under which the Academy shall conduct a study 
     to assess management practices for research, development, and 
     demonstration programs at the Department.
       (b) Scope of the Study.--The study shall consider--
       (1) management practices that act as barriers between the 
     Office of Science and offices conducting mission-oriented 
     research;
       (2) recommendations for management practices that would 
     improve coordination and bridge the innovation gap between 
     the Office of Science and offices conducting mission-oriented 
     research;
       (3) the applicability of the management practices used by 
     the Department of Defense Advanced Research Projects Agency 
     to research programs at the Department;
       (4) the advisability of creating an agency within the 
     Department modeled after the Department of Defense Advanced 
     Research Projects Agency;
       (5) recommendations for management practices that could 
     best encourage innovative research and efficiency at the 
     Department; and
       (6) any other relevant considerations.
       (c) Report.--Not later than 18 months after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     a report on the study conducted under this section.

     SEC. 1822. EFFECT OF ELECTRICAL CONTAMINANTS ON RELIABILITY 
                   OF ENERGY PRODUCTION SYSTEMS.

       Not later than 180 days after the date of enactment of this 
     Act, the Secretary shall enter into a contract with the 
     National Academy of Sciences under which the National Academy 
     of Sciences shall determine the effect that electrical 
     contaminants (such as tin whiskers) may have on the 
     reliability of energy production systems, including nuclear 
     energy.

     SEC. 1823. ALTERNATIVE FUELS REPORTS.

       (a) In General.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     reports on the potential for each of biodiesel and hythane to 
     become major, sustainable, alternative fuels.
       (b) Biodiesel Report.--The report relating to biodiesel 
     submitted under subsection (a) shall--
       (1) provide a detailed assessment of--
       (A) potential biodiesel markets and manufacturing capacity; 
     and

[[Page 17940]]

       (B) environmental and energy security benefits with respect 
     to the use of biodiesel;
       (2) identify any impediments, especially in infrastructure 
     needed for production, distribution, and storage, to 
     biodiesel becoming a substantial source of fuel for 
     conventional diesel and heating oil applications;
       (3) identify strategies to enhance the commercial 
     deployment of biodiesel; and
       (4) include an examination and recommendations, as 
     appropriate, of the ways in which biodiesel may be modified 
     to be a cleaner-burning fuel.
       (c) Hythane Report.--The report relating to hythane 
     submitted under subsection (a) shall--
       (1) provide a detailed assessment of potential hythane 
     markets and the research and development activities that are 
     necessary to facilitate the commercialization of hythane as a 
     competitive, environmentally friendly transportation fuel;
       (2) address--
       (A) the infrastructure necessary to produce, blend, 
     distribute, and store hythane for widespread commercial 
     purposes; and
       (B) other potential market barriers to the 
     commercialization of hythane;
       (3) examine the viability of producing hydrogen using 
     energy-efficient, environmentally friendly methods so that 
     the hydrogen can be blended with natural gas to produce 
     hythane; and
       (4) include an assessment of the modifications that would 
     be required to convert compressed natural gas vehicle engines 
     to engines that use hythane as fuel.
       (d) Grants for Report Completion.--The Secretary may use 
     such sums as are available to the Secretary to provide, to 1 
     or more colleges or universities selected by the Secretary, 
     grants for use in carrying out research to assist the 
     Secretary in preparing the reports required to be submitted 
     under subsection (a).

     SEC. 1824. FINAL ACTION ON REFUNDS FOR EXCESSIVE CHARGES.

       FERC shall--
       (1) seek to conclude its investigation into the unjust or 
     unreasonable charges incurred by California during the 2000-
     2001 electricity crisis as soon as possible;
       (2) seek to ensure that refunds the Commission determines 
     are owed to the State of California are paid to the State of 
     California; and
       (3) submit to Congress a report by December 31, 2005, 
     describing the actions taken by the Commission to date under 
     this section and timetables for further actions.

     SEC. 1825. FUEL CELL AND HYDROGEN TECHNOLOGY STUDY.

       (a) In General.--As soon as practicable after the date of 
     enactment of this Act, the Secretary shall enter into a 
     contract with the National Academy of Sciences and the 
     National Research Council to carry out a study of fuel cell 
     technologies that provides a budget roadmap for the 
     development of fuel cell technologies and the transition from 
     petroleum to hydrogen in a significant percentage of the 
     vehicles sold by 2020.
       (b) Requirements.--In carrying out the study, the National 
     Academy of Sciences and the National Research Council shall--
       (1) establish as a goal the maximum percentage practicable 
     of vehicles that the National Academy of Sciences and the 
     National Research Council determines can be fueled by 
     hydrogen by 2020;
       (2) determine the amount of Federal and private funding 
     required to meet the goal established under paragraph (1);
       (3) determine what actions are required to meet the goal 
     established under paragraph (1);
       (4) examine the need for expanded and enhanced Federal 
     research and development programs, changes in regulations, 
     grant programs, partnerships between the Federal Government 
     and industry, private sector investments, infrastructure 
     investments by the Federal Government and industry, 
     educational and public information initiatives, and Federal 
     and State tax incentives to meet the goal established under 
     paragraph (1);
       (5) consider whether other technologies would be less 
     expensive or could be more quickly implemented than fuel cell 
     technologies to achieve significant reductions in carbon 
     dioxide emissions;
       (6) take into account any reports relating to fuel cell 
     technologies and hydrogen-fueled vehicles, including--
       (A) the report prepared by the National Academy of 
     Engineering and the National Research Council in 2004 
     entitled ``Hydrogen Economy: Opportunities, Costs, Barriers, 
     and R&D Needs''; and
       (B) the report prepared by the U.S. Fuel Cell Council in 
     2003 entitled ``Fuel Cells and Hydrogen: The Path Forward'';
       (7) consider the challenges, difficulties, and potential 
     barriers to meeting the goal established under paragraph (1); 
     and
       (8) with respect to the budget roadmap--
       (A) specify the amount of funding required on an annual 
     basis from the Federal Government and industry to carry out 
     the budget roadmap; and
       (B) specify the advantages and disadvantages to moving 
     toward the transition to hydrogen in vehicles in accordance 
     with the timeline established by the budget roadmap.

     SEC. 1826. PASSIVE SOLAR TECHNOLOGIES.

       (a) Definition of Passive Solar Technology.--In this 
     section, the term ``passive solar technology'' means a 
     passive solar technology, including daylighting, that--
       (1) is used exclusively to avoid electricity use; and
       (2) can be metered to determine energy savings.
       (b) Study.--The Secretary shall conduct a study to 
     determine--
       (1) the range of levelized costs of avoided electricity for 
     passive solar technologies;
       (2) the quantity of electricity displaced using passive 
     solar technologies in the United States as of the date of 
     enactment of this Act; and
       (3) the projected energy savings from passive solar 
     technologies in 5, 10, 15, 20, and 25 years after the date of 
     enactment of this Act if--
       (A) incentives comparable to the incentives provided for 
     electricity generation technologies were provided for passive 
     solar technologies; and
       (B) no new incentives for passive solar technologies were 
     provided.
       (c) Report.--Not later than 120 days after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     a report that describes the results of the study under 
     subsection (b).

     SEC. 1827. STUDY OF LINK BETWEEN ENERGY SECURITY AND 
                   INCREASES IN VEHICLE MILES TRAVELED.

       (a) In General.--The Secretary shall enter into an 
     arrangement with the National Academy of Sciences under which 
     the Academy shall conduct a study to assess the implications 
     on energy use and efficiency of land development patterns in 
     the United States.
       (b) Scope.--The study shall consider--
       (1) the correlation, if any, between land development 
     patterns and increases in vehicle miles traveled;
       (2) whether petroleum use in the transportation sector can 
     be reduced through changes in the design of development 
     patterns;
       (3) the potential benefits of--
       (A) information and education programs for State and local 
     officials (including planning officials) on the potential for 
     energy savings through planning, design, development, and 
     infrastructure decisions;
       (B) incorporation of location efficiency models in 
     transportation infrastructure planning and investments; and
       (C) transportation policies and strategies to help 
     transportation planners manage the demand for the number and 
     length of vehicle trips, including trips that increase the 
     viability of other means of travel; and
       (4) such other considerations relating to the study topic 
     as the National Academy of Sciences finds appropriate.
       (c) Report.--Not later than 2 years after the date of 
     enactment of this Act, the National Academy of Sciences shall 
     submit to the Secretary and Congress a report on the study 
     conducted under this section.

     SEC. 1828. SCIENCE STUDY ON CUMULATIVE IMPACTS OF MULTIPLE 
                   OFFSHORE LIQUEFIED NATURAL GAS FACILITIES.

       (a) In General.--The Secretary (in consultation with the 
     National Oceanic Atmospheric Administration, the Commandant 
     of the Coast Guard, affected recreational and commercial 
     fishing industries, and affected energy and transportation 
     stakeholders) shall carry out a study and compile existing 
     science (including studies and data) to determine the risks 
     or benefits presented by cumulative impacts of multiple 
     offshore liquefied natural gas facilities reasonably assumed 
     to be constructed in an area of the Gulf of Mexico using the 
     open-rack vaporization system.
       (b) Accuracy.--In carrying out subsection (a), the 
     Secretary shall verify the accuracy of available science and 
     develop a science-based evaluation of significant short-term 
     and long-term cumulative impacts, both adverse and 
     beneficial, of multiple offshore liquefied natural gas 
     facilities reasonably assumed to be constructed in an area of 
     the Gulf of Mexico using or proposing the open-rack 
     vaporization system on the fisheries and marine populations 
     in the vicinity of the facility.

     SEC. 1829. ENERGY AND WATER SAVING MEASURES IN CONGRESSIONAL 
                   BUILDINGS.

       (a) In General.--The Architect of the Capitol, as part of 
     the process of updating the Master Plan Study for the Capitol 
     complex, shall--
       (1) carry out a study to evaluate the energy infrastructure 
     of the Capitol complex to determine how to augment the 
     infrastructure to become more energy efficient--
       (A) by using unconventional and renewable energy resources;
       (B) by--
       (i) incorporating new technologies to implement effective 
     green building solutions;
       (ii) adopting computer-based building management systems; 
     and
       (iii) recommending strategies based on end-user behavioral 
     changes to implement low-cost environmental gains; and
       (C) in a manner that would enable the Capitol complex to 
     have reliable utility service in the event of power 
     fluctuations, shortages, or outages;
       (2) carry out a study to explore the feasibility of 
     installing energy and water conservation measures on the 
     rooftop of the Dirksen Senate Office Building, including the 
     area directly above the food service facilities in the center 
     of the building, including the installation of--
       (A) a vegetative covering area, using native species to the 
     maximum extent practicable, to--
       (i) insulate and increase the energy efficiency of the 
     building;
       (ii) reduce precipitation runoff and conserve water for 
     landscaping or other uses;
       (iii) increase, and provide more efficient use of, 
     available outdoor space through management of the rooftop of 
     the center of the building

[[Page 17941]]

     as a park or garden area for occupants of the building; and
       (iv) improve the aesthetics of the building; and
       (B) onsite renewable energy and other state-of-the-art 
     technologies to--
       (i) improve the energy efficiency and energy security of 
     the building or the Capitol complex by providing additional 
     or backup sources of power in the event of a power shortage 
     or other emergency;
       (ii) reduce the use of resources by the building; or
       (iii) enhance worker productivity; and
       (C) not later than 180 days after the date of enactment of 
     this Act, submit to Congress a report describing the findings 
     and recommendations of the study under subparagraph (B).
       (b) Authorization of Appropriations.--There is authorized 
     to be appropriated to the Architect of the Capitol to carry 
     out this section $2,000,000 for each of fiscal years 2006 
     through 2010.

     SEC. 1830. STUDY OF AVAILABILITY OF SKILLED WORKERS.

       (a) In General.--The Secretary shall enter into an 
     arrangement with the National Academy of Sciences under which 
     the National Academy of Sciences shall conduct a study of the 
     short-term and long-term availability of skilled workers to 
     meet the energy and mineral security requirements of the 
     United States.
       (b) Inclusions.--The study shall include an analysis of--
       (1) the need for and availability of workers for the oil, 
     gas, and mineral industries;
       (2) the availability of skilled labor at both entry level 
     and more senior levels; and
       (3) recommendations for future actions needed to meet 
     future labor requirements.
       (c) Report.--Not later than 2 years after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     a report that describes the results of the study.

     SEC. 1831. REVIEW OF ENERGY POLICY ACT OF 1992 PROGRAMS.

       (a) In General.--Not later than 180 days after the date of 
     enactment of this section, the Secretary shall complete a 
     study to determine the effect that titles III, IV, and V of 
     the Energy Policy Act of 1992 (42 U.S.C. 13211 et seq.) have 
     had on--
       (1) the development of alternative fueled vehicle 
     technology;
       (2) the availability of that technology in the market; and
       (3) the cost of alternative fueled vehicles.
       (b) Topics.--As part of the study under subsection (a), the 
     Secretary shall specifically identify--
       (1) the number of alternative fueled vehicles acquired by 
     fleets or covered persons required to acquire alternative 
     fueled vehicles;
       (2) the quantity, by type, of alternative fuel actually 
     used in alternative fueled vehicles acquired by fleets or 
     covered persons;
       (3) the quantity of petroleum displaced by the use of 
     alternative fuels in alternative fueled vehicles acquired by 
     fleets or covered persons;
       (4) the direct and indirect costs of compliance with 
     requirements under titles III, IV, and V of the Energy Policy 
     Act of 1992 (42 U.S.C. 13211 et seq.), including--
       (A) vehicle acquisition requirements imposed on fleets or 
     covered persons;
       (B) administrative and recordkeeping expenses;
       (C) fuel and fuel infrastructure costs;
       (D) associated training and employee expenses; and
       (E) any other factors or expenses the Secretary determines 
     to be necessary to compile reliable estimates of the overall 
     costs and benefits of complying with programs under those 
     titles for fleets, covered persons, and the national economy;
       (5) the existence of obstacles preventing compliance with 
     vehicle acquisition requirements and increased use of 
     alternative fuel in alternative fueled vehicles acquired by 
     fleets or covered persons; and
       (6) the projected impact of amendments to the Energy Policy 
     Act of 1992 made by this title.
       (c) Report.--Upon completion of the study under this 
     section, the Secretary shall submit to Congress a report that 
     describes the results of the study and includes any 
     recommendations of the Secretary for legislative or 
     administrative changes concerning the alternative fueled 
     vehicle requirements under titles III, IV and V of the Energy 
     Policy Act of 1992 (42 U.S.C. 13211 et seq.).

     SEC. 1832. STUDY ON THE BENEFITS OF ECONOMIC DISPATCH.

       (a) Study.--The Secretary, in coordination and consultation 
     with the States, shall conduct a study on--
       (1) the procedures currently used by electric utilities to 
     perform economic dispatch;
       (2) identifying possible revisions to those procedures to 
     improve the ability of nonutility generation resources to 
     offer their output for sale for the purpose of inclusion in 
     economic dispatch; and
       (3) the potential benefits to residential, commercial, and 
     industrial electricity consumers nationally and in each state 
     if economic dispatch procedures were revised to improve the 
     ability of nonutility generation resources to offer their 
     output for inclusion in economic dispatch.
       (b) Definition.--The term ``economic dispatch'' when used 
     in this section means the operation of generation facilities 
     to produce energy at the lowest cost to reliably serve 
     consumers, recognizing any operational limits of generation 
     and transmission facilities.
       (c) Report to Congress and the States.--Not later than 90 
     days after the date of enactment of this Act, and on a yearly 
     basis following, the Secretary shall submit a report to 
     Congress and the States on the results of the study conducted 
     under subsection (a), including recommendations to Congress 
     and the States for any suggested legislative or regulatory 
     changes.

     SEC. 1833. RENEWABLE ENERGY ON FEDERAL LAND.

       (a) National Academy of Sciences Study.--Not later than 90 
     days after the date of enactment of this Act, the Secretary 
     of the Interior shall enter into a contract with the National 
     Academy of Sciences under which the National Academy of 
     Sciences shall--
       (1) study the potential of developing wind, solar, and 
     ocean energy resources (including tidal, wave, and thermal 
     energy) on Federal land available for those uses under 
     current law and the outer Continental Shelf;
       (2) assess any Federal law (including regulations) relating 
     to the development of those resources that is in existence on 
     the date of enactment of this Act; and
       (3) recommend statutory and regulatory mechanisms for 
     developing those resources.
       (b) Submission to Congress.--Not later than 2 years after 
     the date of enactment of this Act, the Secretary of the 
     Interior shall submit to Congress the results of the study 
     under subsection (a).

     SEC. 1834. INCREASED HYDROELECTRIC GENERATION AT EXISTING 
                   FEDERAL FACILITIES.

       (a) In General.--The Secretary of the Interior, the 
     Secretary, and the Secretary of the Army shall jointly 
     conduct a study of the potential for increasing electric 
     power production capability at federally owned or operated 
     water regulation, storage, and conveyance facilities.
       (b) Content.--The study under this section shall include 
     identification and description in detail of each facility 
     that is capable, with or without modification, of producing 
     additional hydroelectric power, including estimation of the 
     existing potential for the facility to generate hydroelectric 
     power.
       (c) Report.--The Secretaries shall submit to the Committees 
     on Energy and Commerce, Resources, and Transportation and 
     Infrastructure of the House of Representatives and the 
     Committee on Energy and Natural Resources of the Senate a 
     report on the findings, conclusions, and recommendations of 
     the study under this section by not later than 18 months 
     after the date of the enactment of this Act. The report shall 
     include each of the following:
       (1) The identifications, descriptions, and estimations 
     referred to in subsection (b).
       (2) A description of activities currently conducted or 
     considered, or that could be considered, to produce 
     additional hydroelectric power from each identified facility.
       (3) A summary of prior actions taken by the Secretaries to 
     produce additional hydroelectric power from each identified 
     facility.
       (4) The costs to install, upgrade, or modify equipment or 
     take other actions to produce additional hydroelectric power 
     from each identified facility and the level of Federal power 
     customer involvement in the determination of such costs.
       (5) The benefits that would be achieved by such 
     installation, upgrade, modification, or other action, 
     including quantified estimates of any additional energy or 
     capacity from each facility identified under subsection (b).
       (6) A description of actions that are planned, underway, or 
     might reasonably be considered to increase hydroelectric 
     power production by replacing turbine runners, by performing 
     generator upgrades or rewinds, or construction of pumped 
     storage facilities.
       (7) The impact of increased hydroelectric power production 
     on irrigation, water supply, fish, wildlife, Indian tribes, 
     river health, water quality, navigation, recreation, fishing, 
     and flood control.
       (8) Any additional recommendations to increase 
     hydroelectric power production from, and reduce costs and 
     improve efficiency at, federally owned or operated water 
     regulation, storage, and conveyance facilities.

     SEC. 1835. SPLIT-ESTATE FEDERAL OIL AND GAS LEASING AND 
                   DEVELOPMENT PRACTICES.

       (a) Review.--In consultation with affected private surface 
     owners, oil and gas industry, and other interested parties, 
     the Secretary of the Interior shall undertake a review of the 
     current policies and practices with respect to management of 
     Federal subsurface oil and gas development activities and 
     their effects on the privately owned surface. This review 
     shall include--
       (1) a comparison of the rights and responsibilities under 
     existing mineral and land law for the owner of a Federal 
     mineral lease, the private surface owners and the Department;
       (2) a comparison of the surface owner consent provisions in 
     section 714 of the Surface Mining Control and Reclamation Act 
     of 1977 (30 U.S.C. 1304) concerning surface mining of Federal 
     coal deposits and the surface owner consent provisions for 
     oil and gas development, including coalbed methane 
     production; and
       (3) recommendations for administrative or legislative 
     action necessary to facilitate reasonable access for Federal 
     oil and gas activities while addressing surface owner 
     concerns and minimizing impacts to private surface.
       (b) Report.--The Secretary of the Interior shall report the 
     results of such review to Congress not later than 180 days 
     after the date of enactment of this Act.

[[Page 17942]]



     SEC. 1836. RESOLUTION OF FEDERAL RESOURCE DEVELOPMENT 
                   CONFLICTS IN THE POWDER RIVER BASIN.

       (a) Review.--The Secretary of the Interior shall review 
     Federal and State laws in existence on the date of enactment 
     of this Act in order to resolve any conflict relating to the 
     Powder River Basin in Wyoming and Montana between--
       (1) the development of Federal coal; and
       (2) the development of Federal and non-Federal coalbed 
     methane.
       (b) Report.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary of the Interior shall 
     submit to Congress a report that--
       (1) describes methods of resolving a conflict described in 
     subsection (a); and
       (2) identifies a method preferred by the Secretary of the 
     Interior, including proposed legislative language, if any, 
     required to implement the method.

     SEC. 1837. NATIONAL SECURITY REVIEW OF INTERNATIONAL ENERGY 
                   REQUIREMENTS.

       (a) Study.--The Secretary, in consultation with the 
     Secretary of Defense and Secretary of Homeland Security, 
     shall conduct a study of the growing energy requirements of 
     the People's Republic of China and the implications of such 
     growth on the political, strategic, economic, or national 
     security interests of the United States, including--
       (1) an assessment of the type, nationality, and location of 
     energy assets that have been sought for investment by 
     entities located in the People's Republic of China;
       (2) an assessment of the extent to which investment in 
     energy assets by entities located in the People's Republic of 
     China has been on market-based terms and free from subsidies 
     from the People's Republic of China;
       (3) an assessment of the effect of investment in energy 
     assets by entities located in the People's Republic of China 
     on the control by the United States of dual-use and export-
     controlled technologies, including the effect on current and 
     future access to foreign and domestic sources of rare earth 
     elements used to produce such technologies;
       (4) an assessment of the relationship between the 
     Government of the People's Republic of China and energy-
     related businesses located in the People's Republic of China;
       (5) an assessment of the impact on the world energy market 
     of the common practice of entities located in the People's 
     Republic of China of removing the energy assets owned or 
     controlled by such entities from the competitive market, with 
     emphasis on the effect if such practice expands along with 
     the growth in energy consumption of the People's Republic of 
     China;
       (6) an examination of the United States energy policy and 
     foreign policy as it relates to ensuring a competitive global 
     energy market;
       (7) an examination of the relationship between the United 
     States and the People's Republic of China as it relates to 
     pursuing energy interests in a manner that avoids conflicts; 
     and
       (8) a comparison of the appropriate laws and regulations of 
     other nations to determine whether a United States company 
     would be permitted to purchase, acquire, merge, or otherwise 
     establish a joint relationship with an entity whose primary 
     place of business is in that other nation, including the laws 
     and regulations of the People's Republic of China.
       (b) Report and Recommendations.--Not later than 120 days 
     after the date of the enactment of this Act, the Secretary, 
     in consultation with the Secretary of Defense, shall report 
     to the President and the Congress on the findings of the 
     study described in subsection (a) and any recommendations the 
     Secretaries consider appropriate.
       (c) Regulatory Effect.--Notwithstanding any other provision 
     of law, any instrumentality of the United States vested with 
     authority to review a transaction that includes an investment 
     in a United States domestic corporation may not conclude a 
     national security review related to an investment in the 
     energy assets of a United States domestic corporation by an 
     entity owned or controlled by the government of the People's 
     Republic of China for 21 days after the report to the 
     President and the Congress, and until the President certifies 
     that he has received the report described in subsection (b).

     SEC. 1838. USED OIL RE-REFINING STUDY.

       The Secretary, in consultation with the Administrator of 
     the Environmental Protection Agency, shall undertake a study 
     of the energy and environmental benefits of the re-refining 
     of used lubricating oil and report to Congress within 90 days 
     after enactment of this Act including recommendations of 
     specific steps that can be taken to improve collections of 
     used lubricating oil and increase re-refining and other 
     beneficial re-use of such oil.

     SEC. 1839. TRANSMISSION SYSTEM MONITORING.

       Within 6 months after the date of enactment of this Act, 
     the Secretary and the Federal Energy Regulatory Commission 
     shall study and report to Congress on the steps which must be 
     taken to establish a system to make available to all 
     transmission system owners and Regional Transmission 
     Organizations (as defined in the Federal Power Act) within 
     the Eastern and Western Interconnections real-time 
     information on the functional status of all transmission 
     lines within such Interconnections. In such study, the 
     Commission shall assess technical means for implementing such 
     transmission information system and identify the steps the 
     Commission or Congress must take to require the 
     implementation of such system.

     SEC. 1840. REPORT IDENTIFYING AND DESCRIBING THE STATUS OF 
                   POTENTIAL HYDROPOWER FACILITIES.

       (a) Report Requirement.--Not later than 90 days after the 
     date of enactment of this Act, the Secretary of the Interior, 
     acting through the Bureau of Reclamation, shall submit to the 
     Committee on Resources of the House of Representatives and 
     the Committee on Energy and Natural Resources of the Senate a 
     report identifying and describing the status of potential 
     hydropower facilities included in water surface storage 
     studies undertaken by the Secretary for projects that have 
     not been completed or authorized for construction.
       (b) Report Contents.--The report shall include the 
     following:
       (1) Identification of all surface storage studies 
     authorized by Congress since the enactment of the Reclamation 
     Project Act of 1939 (43 U.S.C. 485 et seq.).
       (2) The purposes of each project included within each study 
     identified under paragraph (1).
       (3) The status of each study identified under paragraph 
     (1), including for each study--
       (A) whether the study is completed or, if not completed, 
     still authorized;
       (B) the level of analyses conducted at the feasibility and 
     reconnaissance levels of review;
       (C) identifiable environmental impacts of each project 
     included in the study, including to fish and wildlife, water 
     quality, and recreation;
       (D) projected water yield from each such project;
       (E) beneficiaries of each such project;
       (F) the amount authorized and expended;
       (G) projected funding needs and timelines for completing 
     the study (if applicable);
       (H) anticipated costs of each such project; and
       (I) other factors that might interfere with construction of 
     any such project.
       (4) An identification of potential hydroelectric facilities 
     that might be developed pursuant to each study identified 
     under paragraph (1).
       (5) Applicable costs and benefits associated with potential 
     hydroelectric production pursuant to each study.
       And the Senate agree to the same.

     From the Committee on Energy and Commerce, for consideration 
     of the House bill and the Senate amendment, and modifications 
     committed to conference:
     Joe Barton,
     Ralph M. Hall,
     Mike Bilirakis,
     Fred Upton,
     Cliff Stearns,
     Paul Gillmor,
     John Shimkus,
     John Shadegg,
     Chip Pickering,
     Roy Blunt,
     Charles F. Bass,
     John D. Dingell,
     Rick Boucher,
     Bart Stupak,
     Albert R. Wynn,
     From the Committee on Agriculture, for consideration of secs. 
     332, 344, 346, 1701, 1806, 2008, 2019, 2024, 2029, and 2030 
     of the House bill, and secs. 251-253, 264, 303, 319, 342, 
     343, 345, and 347 of the Senate amendment, and modifications 
     committed to conference:
     Bob Goodlatte,
     Frank D. Lucas,
     Collin C. Peterson,
     From the Committee on Armed Services, for consideration of 
     secs. 104, 231, 601-607, 609-612, and 661 of the House bill, 
     and secs. 104, 281, 601-607, 609, 610, 625, 741-743, 1005, 
     and 1006 of the Senate amendment, and modifications committed 
     to conference:
     Duncan Hunter,
     Curt Weldon,
     Ike Skelton,
     From the Committee on Education and the Workforce, for 
     consideration of secs. 121, 632, 640, 2206, and 2209 of the 
     House bill, and secs. 625, 1103, 1104, and 1106 of the Senate 
     amendment, and modifications committed to conference:
     Charlie Norwood,
     Sam Johnson,
     From the Committee on Financial Services, for consideration 
     of secs. 141-149 of the House bill, and secs. 161-164 and 505 
     of the Senate amendment, and modifications committed to 
     conference:
     Michael G. Oxley,
     Bob Ney,
     From the Committee on Government Reform, for consideration of 
     secs. 102, 104, 105, 203, 205, 502, 624, 632, 701, 704, 1002, 
     1227, and 2304 of the House bill, and secs. 102, 104, 105, 
     108, 203, 502, 625, 701-703, 723-725, 741-743, 939, and 1011 
     of the Senate amendment, and modifications committed to 
     conference:
     Tom Davis,
     Darrell Issa,
     Diane E. Watson,
     From the Committee on the Judiciary, for consideration of 
     secs. 320, 377, 612, 625, 632, 663, 665, 1221, 1265, 1270, 
     1283, 1442, 1502, and 2208 of the House bill, and secs. 137, 
     211, 328, 384, 389, 625, 1221, 1264, 1269, 1270, 1275, 1280, 
     and 1402 of the Senate amendment, and modifications committed 
     to conference:
     F. James Sensenbrenner, Jr.,
     Steve Chabot,
     From the Committee on Resources, for consideration of secs. 
     204, 231, 330, 344, 346, 355, 358, 377, 379, Title V, secs. 
     969-976, 1701, 1702, Title XVIII, secs. 1902, 2001-2019, 
     2022-2031, 2033, 2041, 2042, 2051-2055, Title XXI, Title 
     XXII, and Title XXIV of the House bill, and secs. 241-245, 
     252, 253, 261-270, 281, 311-317, 319-323, 326, 327, 342-346, 
     348, 371, 387, 391, 411-414,

[[Page 17943]]

     416, and 501-506 of the Senate amendment, and modifications 
     committed to conference:
     Richard Pombo,
     Barbara Cubin,
     Nick Rahall,
     From the Committee on Rules, for consideration of sec. 713 of 
     the Senate amendment, and modifications committed to 
     conference:
     David Dreier,
     Lincoln Diaz-Balart,
     Louise Slaughter,
     From the Committee on Science, for consideration of secs. 
     108, 126, 205, 209, 302, 401-404, 411, 416, 441, 601-607, 
     609-612, 631, 651, 652, 661, 711, 712, 721-724, 731, 741-744, 
     751, 754, 757, 759, 801-811, Title IX, secs. 1002, 1225-1227, 
     1451, 1452, 1701, 1820, and Title XXIV of the House bill, and 
     secs. 125, 126, 142, 212, 230-232, 251-253, 302, 318, 327, 
     346, 401-407, 415, 503, 601-607, 609, 610, 624, 631-635, 706, 
     721, 722, 725, 731, 734, 751, 752, 757, 801, Title IX, Title 
     X, secs. 1102, 1103, 1105, 1106, 1224, Title XIV, secs. 1601, 
     1602, and 1611 of the Senate amendment, and modifications 
     committed to conference:
     Sherwood Boehlert,
     Judy Biggert,
     Bart Gordon,
     Provided that Mr. Costello is appointed in lieu of Mr. Gordon 
     for consideration of secs. 401-404, 411, 416, and 441 of the 
     House bill, and secs. 401-407 and 415 of the Senate 
     amendment, and modifications committed to conference:
     Jerry F. Costello,
     From the Committee on Transportation and Infrastructure, for 
     consideration of secs. 101-103, 105, 108, 109, 137, 205, 208, 
     231, 241, 242, 320, 328-330, 377, 379, 721-724, 741-744, 751, 
     755, 756, 758, 811, 1211, 1221, 1231, 1234, 1236, 1241, 1281-
     1283, 1285, 1295, 1442, 1446, 2008, 2010, 2026, 2029, 2030, 
     2207, and 2210 of the House bill, and secs. 101-103, 105, 
     107, 108, 281, 325, 344, 345, 383, 731-733, 752, 1211, 1221, 
     1231, 1233, 1235, 1261, 1263, 1266, and 1291 of the Senate 
     amendment, and modifications committed to conference:
     Don Young,
     Tom Petri,
     From the Committee on Ways and Means, for consideration of 
     Title XII of the House bill, and secs. 135, 405, Title XV, 
     and sec. 1611 of the Senate amendment, and modifications 
     committed to conference:
     William Thomas,
     Dave Camp,
                                Managers on the Part of the House.

     Pete Domenici,
     Larry E. Craig,
     Craig Thomas,
     Lamar Alexander,
     Lisa Murkowski,
     Jeff Bingaman,
     Daniel D. Akaka,
     Byron L. Dorgan,
     Richard M. Burr,
     Tim Johnson,
     Chuck Grassley,
     Orrin Hatch,
     Max Baucus,
                               Managers on the Part of the Senate.

       JOINT EXPLANATORY STATEMENT OF THE COMMITTEE OF CONFERENCE

       The Managers on the part of the House and Senate at the 
     conference on the disagreeing votes of the two Houses on the 
     amendment of the Senate to the bill H.R. 6, to ensure jobs 
     for our future with secure, affordable, and reliable energy, 
     submit the following joint statement to the House and the 
     Senate in explanation of the effect of the action agreed upon 
     by the Managers and recommended in the accompanying 
     conference report:
       The Senate amendment to the text of the bill struck all of 
     the House bill after the enacting clause, and inserted a 
     substitute text.
       The House recess from its disagreement to the amendment of 
     the Senate with an amendment that is a substitute for the 
     House bill and the Senate amendment.
       The mangers on the Part of the House and Senate met on July 
     14, July 19, July 21, July 24, and July 25, 2005.
     From the Committee on Energy and Commerce, for consideration 
     of the House bill and the Senate amendment, and modifications 
     committed to conference:
     Joe Barton,
     Ralph M. Hall,
     Mike Bilirakis,
     Fred Upton,
     Cliff Stearns,
     Paul Gillmar,
     John Shimkus,
     John Shadegg,
     Chip Pickering,
     Roy Blunt,
     Charles F. Bass,
     John D. Dingell,
     Rich Boucher,
     Bart Stupak,
     Albert R. Wynn,
     From the Committee on Agriculture, for consideration of secs. 
     332, 344, 346, 1701, 1806, 2008, 2019, 2024, 2029, and 2030 
     of the House bill, and secs. 251-253, 264, 303, 319, 342, 
     343, 345, and 347 of the Senate amendment, and modifications 
     committed to conference:
     Bob Goodlatte,
     Frank D. Lucas,
     Collin C. Peterson,
     From the Committee on Armed Services, for consideration of 
     secs. 104, 231, 601-607, 609-612, and 661 of the House bill, 
     and secs. 104, 281, 601-607, 609, 625, 741-743, 1005, and 
     1006 of the Senate amendment, and modifications committed to 
     conference:
     Duncan Hunter,
     Curt Weldon,
     Ike Skelton,
     From the Committee on Education and the Workforce, for 
     consideration of secs. 121, 632, 640, 2206, and 2209 of the 
     House bill, and secs. 625, 1103, 1104, and 1106 of the Senate 
     amendment, and modifications committed to conference:
     Charlie Norwood,
     Sam Johnson,
     From the Committee on Financial Services, for consideration 
     of secs. 141-149, of the House bill, and secs. 161-164, and 
     505 of the Senate amendment, and modifications committed to 
     conference:
     Michael G. Oxley,
     Bob Ney,
     From the Committee on Government Reform, for consideration of 
     secs. 102, 104, 105, 203, 205, 502, 624, 632, 701, 704, 1002, 
     1227, and 2304 of the House bill, and secs. 102, 104, 105, 
     108, 203, 502, 625, 701-703, 723-725, 741-743, 939, and 1011 
     of the Senate amendment, and modifications committed to 
     conference:
     Tom Davis,
     Darrell Issa,
     Diane E. Watson,
     From the Committee on Judiciary, for consideration of secs. 
     320, 377, 612, 625, 632, 663, 665, 1221, 1265, 1270, 1283, 
     1442, 1502, and 2208 of the House bill, and secs. 137, 211, 
     328, 384, 389, 625, 1221, 1264, 1269, 1270, 1275, 1280, and 
     1402 of the Senate amendment, and modifications committed to 
     conference:
     F. James Sensenbrenner Jr.,
     Steve Chabot,
     From the Committee on Resources, for consideration of secs. 
     204, 231, 330, 344, 346, 355, 358, 377, 379, Title V, secs. 
     969-976, 1701, 1702, Title XVII, secs. 1902, 2001-2019, 2022-
     2031, 2033, 2041, 2042, 2051-2055, Title XXI, Title XXII, and 
     Title XXIV of the House bill, and secs. 241-245, 252, 253, 
     261-270, 281, 311-317, 319-323, 326, 327, 342-346, 348, 371, 
     387, 391, 411-414, 416, and 501-506 of the Senate amendment, 
     and modifications committed to conference:
     Richard Pombo,
     Barbara Cubin,
     Nick Rahall,
     From the Committee on Rules, for consideration of secs. 713 
     of the Senate amendment, and modifications committed to 
     conference:
     David Dreier,
     Lincoln Diaz-Balart,
     Louise Slaugter,
     From the Committee on Science, for consideration of secs. 
     108, 126, 205, 209, 302, 401-404, 411, 416, 441, 601-607, 
     609-612, 631, 651, 652, 661, 711, 712, 721-724, 731, 741-744, 
     751, 754, 757, 759, 801-811, Title IX, secs. 1002, 1225-1777, 
     1451, 1452, 1701, 1820, and Title XXIV of the House bill, and 
     secs. 125, 126, 142, 212, 230-232, 251-253, 302, 318, 327, 
     346, 401-407, 415, 503, 601-607, 609, 610, 624, 631-635, 706, 
     721, 722, 725, 731, 734, 751, 752, 757, 801, Title IX, Title 
     X, secs. 1102, 1103, 1105, 1106, 1224, Title XIV, secs. 1601, 
     1602, and 1611 of the Senate amendment, and modifications 
     committed to conference:
     Sherwood Boehlert,
     Judy Biggert,
     Bart Gordon,
     Provided that Mr. Costello is appointed in lieu of Mr. Gordon 
     for consideration of secs. 401-404, 411, 416, and 441 of the 
     House bill, and secs. 401-407 and 415 of the Senate 
     amendment, and modifications committed to conference:
     Jerry F. Costello,
     From the Committee on Transportation and Infrastructure, for 
     consideration of secs. 101-103, 105, 108, 109, 137, 205, 208, 
     231, 241, 242, 320, 328-330, 377, 379, 721-724, 741-744, 751, 
     755, 756, 758, 811, 1211, 1221, 1231, 1234, 1236, 1241, 1281-
     1283, 1285, 1295, 1442, 1446, 2008, 2010, 2026, 2029, 2030, 
     2207, and 2210 of the House bill, and secs. 101-103, 105, 
     107, 108, 281, 325, 344, 345, 383, 731-733, 752, 1211, 1221, 
     1231, 1233, 1235, 1261, 1263, 1266, and 1291 of the Senate 
     amendment, and modifications committed to conference:
     Don Young,
     Tom Petri,
     From the Committee on Ways and Means, for consideration of 
     Title XIII of the House bill, and secs. 135, 405, Title XV, 
     and sec. 1611 of the Senate amendment, and modifications 
     committed to conference:
     William Thomas,
     Dave Camp,
                                Managers on the Part of the House.

     Pete Domenici,
     Larry E. Craig,
     Craig Thomas,
     Lamar Alexander,
     Lisa Murkowski,
     Jeff Bingaman,
     Daniel K. Akaka,
     Byron L. Dorgan,
     Richard M. Burr,
     Tim Johnson,
     Chuck Grassley,
     Orrin Hatch,
     Max Baucus,
     Managers on the Part of the Senate.

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