[Congressional Record (Bound Edition), Volume 151 (2005), Part 5]
[House]
[Pages 7112-7293]
[From the U.S. Government Publishing Office, www.gpo.gov]




                       ENERGY POLICY ACT OF 2005

  The SPEAKER pro tempore. Pursuant to House Resolution 219 and rule 
XVIII, the Chair declares the House in the Committee of the Whole House 
on the State of the Union for the consideration of the bill, H.R. 6.
  The Chair designates the gentlewoman from West Virginia (Mrs. Capito) 
as Chairman of the Committee of the Whole, and requests the gentleman 
from Iowa (Mr. Latham) to assume the chair temporarily.

                              {time}  1458


                     In the Committee of the Whole

  Accordingly, the House resolved itself into the Committee of the 
Whole House on the State of the Union for the consideration of the bill 
(H.R. 6) to ensure jobs for our future with secure, affordable, and 
reliable energy, with Mr. Latham (Acting Chairman) in the chair.
  The Clerk read the title of the bill.
  The Acting CHAIRMAN. Pursuant to the rule, the bill is considered 
read the first time.
  General debate shall not exceed 1 hour and 30 minutes, with 30 
minutes equally divided and controlled by the chairman and ranking 
member of the Committee on Energy and Commerce, and 20 minutes equally 
divided and controlled by the chairman and ranking member of each of 
the committees on Science, Resources, and Ways and Means.
  The gentleman from Texas (Mr. Barton) and the gentleman from Michigan 
(Mr. Dingell) each will control 15 minutes from the Committee on Energy 
and Commerce.
  The Chair recognizes the gentleman from Texas (Mr. Barton).

                              {time}  1500

  Mr. BARTON of Texas. Mr. Chairman, I yield myself 2 minutes.
  Mr. Chairman, I rise in strong support of H.R. 6, the Energy Policy 
Act of 2005. Passage of this comprehensive bill will ensure a more 
affordable, environmentally friendly energy supply.
  America's prosperity and national security are at stake. The bill 
before us today is a balanced bill and it is a bipartisan bill. It will 
have lower energy prices over time for consumers, it will help spur our 
economy, create hundreds of thousands of jobs, and take unprecedented 
steps to promote greater energy conservation and efficiency.
  The Energy Policy Act of 2005, among other things, improves our 
Nation's electric transmission capacity; promotes a cleaner environment 
with new innovations on alternative power sources, the Clean Cities 
authorization, and the hydrogen fuel cell car program; it promotes 
clean coal technologies, provides incentives for renewable energies, 
such as biomass, wind, solar and hydroelectricity.
  The bill would provide leadership in energy conservation by 
establishing new mandatory efficiency requirements for Federal 
buildings, and expands the Energy Star program to tell American 
consumers what products save the most energy.
  The bill also provides an efficient approval process for siting new 
liquified

[[Page 7113]]

natural gas facilities. It would, for the first time, give an expedited 
procedure, hopefully in brownfield areas and high-unemployment areas, 
for expanding or building some new refineries. We have not built a new 
oil refinery in this country for the past 30 years.
  I could go on and on, Mr. Chairman, but simply let me say at the 
beginning of the debate that it is time for an energy policy for 
America. It is time for the House of Representatives to say we want a 
strong economy based on the world's best and most open free market for 
energy supplies, and also to put some incentives in for conservation.
  I strongly support the bill, and I look forward to the debate we are 
about to begin.
  Mr. DINGELL. Mr. Chairman, I yield myself 3 minutes.
  Mr. Chairman, we have a bad bill. It is represented as being 
something which is going to save money and increase energy supplies. 
The Energy Information agency says neither of these cases is true. It 
is not going to reduce energy prices, but rather will increase the cost 
of gasoline.
  Let us look at what our country needs. It needs Congress to pass a 
real energy bill, not a flawed bill that will hurt the environment, 
hurt consumers, and cost taxpayers a bundle of money. Democrats have 
been trying to work with our Republican colleagues to get balanced, 
sensible legislation, starting with a clean slate in a bipartisan 
fashion.
  We have been denied that opportunity. The Republican leadership 
chose, instead, to push an outdated energy bill which had its origins 
in the secret Cheney Energy Task Force and was negotiated in secret 
conference meetings which excluded the Democrats.
  The administration's own Energy Information Administration analyzed 
the old bill saying changes to production, consumption, imports, and 
prices are negligible. It even found, as I noted, that gasoline prices 
under the bill would increase more than if the bill were not enacted.
  While the bill will little help our energy independence, it is far 
from benign. Despite our efforts to overturn the antienvironmental 
provisions of the bill, it weakens laws such as the Safe Drinking Water 
Act and the Leaking Underground Storage Tank program that protect the 
environment and public health.
  The bill also changes hydroelectric power policies by undercutting 
safeguards for dam relicensing. It gives power producers more and 
better rights than States, tribes, and other public entities. It 
jeopardizes not only fish, but the overall health of our river systems 
and the recreational activities that they sustain; and it confers, 
unfairly, rights on people, while not taking the same care of the 
concern of the citizenry generally.
  The bill eliminates requirements for public participation and 
deference to the States in decisions about the siting of electric 
transmission lines and natural gas facilities.
  As far as consumers are concerned, it is hard to imagine a better 
case for increasing consumer protections than the debacle which took 
place in the West Coast electricity markets in 2000 and 2001. The 
Federal Energy Regulatory Commission has determined widespread fraud 
existed, and there are tapes to prove it; yet this bill gives only 
cosmetic reforms in law and, in point of fact, repeals the Public 
Utility Holding Company Act of 1935, which protects consumers and 
investors.
  And it does nothing to assure refunds of unjust and unreasonable 
overcharges. While blackouts cost the consumers $80 billion, this bill 
holds a sensible reliability provision hostage to its more 
controversial provision and caps the necessary expenditure to set the 
job right.
  Taxpayers will also be hit hard by this bill. We do not know the 
total cost, but last time it cost over $30 billion, four times the 
amount requested by the administration.
  This is a bad bill. I urge my colleagues to reject it.
  Mr. BARTON of Texas. Mr. Chairman, I yield 2 minutes to the gentleman 
from Georgia (Mr. Norwood), a member of the committee.
  Mr. NORWOOD. Mr. Chairman, I thank the gentleman for yielding me this 
time, and I have a little different view of this.
  This is a good bill. It is a bill this country needs. We need a 
national energy policy, there is no question about it, and I 
congratulate the gentleman from Texas (Mr. Barton) on years of hard, 
dedicated work to bring this to the floor.
  Having said that, like any other bill I have ever seen, it is not a 
perfect bill; it has its good and bad parts. And if I could, Mr. 
Chairman, just for the record, I would like to have a little quick 
colloquy with the gentleman from Texas.
  Mr. BARTON of Texas. Mr. Chairman, if the gentleman will yield, I 
would be happy to have a colloquy with the gentleman from Georgia.
  Mr. NORWOOD. Mr. Chairman, as my colleague from Texas knows, the 
electricity title is very, very important to my consumers and my 
constituents in the southeast as well as in the northwest, and one of 
the provisions in the title that is not there is regarding 
participatory funding.
  Since that is a fairly standard thought-out thing in regional 
transmission organizations, I am concerned that the bill does not have 
any language in there to assure me and my constituents that they are 
not going to have to pay extra. We do really want to help people that 
are having blackouts and brownouts, but we do not think we should pay 
the whole load.
  What can I anticipate on participatory funding down the road?
  Mr. BARTON of Texas. Mr. Chairman, will the gentleman yield?
  Mr. NORWOOD. I yield to the gentleman from Texas.
  Mr. BARTON of Texas. Mr. Chairman, as the gentleman well knows, the 
gentleman from Illinois (Mr. Shimkus) offered an amendment in the 
committee that struck the participatory funding language from the 
conference report, but at that time, I assured the gentleman from 
Georgia and the gentleman from Mississippi and several other interested 
Congressmen in the committee that when we go to conference with the 
Senate, we will work out language that is fair and balanced and 
protects the rights of the incumbent local utilities and also the 
independent power producers to find a fair and balanced way in which to 
build and maintain the transmission system for our great Nation's 
electricity grid.
  Mr. NORWOOD. Mr. Chairman, reclaiming my time, I thank the gentleman 
very much. As he knows, I agree participatory means ``everybody pays,'' 
and those that reap the advantages of this, which will be the 
generators of electricity and the receivers of electricity, need to 
pay. And I am all right with that.
  I thank my colleague, and I look forward to working with him on this 
as we move forward toward conference.
  Mr. BARTON of Texas. If the gentleman will continue to yield, there 
will be a provision in the conference report that comes back when we 
report the conference out.
  Mr. NORWOOD. I thank the Chairman.
  Mr. DINGELL. Mr. Chairman, I yield 3 minutes to the gentleman from 
California (Mr. Waxman).
  Mr. WAXMAN. Mr. Chairman, Republican leaders say that the bill before 
us is comprehensive energy legislation that will meet the Nation's 
energy needs by protecting the environment and safeguarding consumers. 
Well, these are the right goals, but there is only one problem: The 
bill accomplishes none of them. This is an antienvironment, 
anticonsumer, antitaxpayer bill.
  This bill fails to provide secure, sustainable, and affordable energy 
supplies. It does nothing about the most important energy issues facing 
our Nation, like addressing global warming and reducing the Nation's 
dependence on foreign oil. Instead, this bill lavishes taxpayer 
subsidies on big energy companies, while weakening our environmental 
laws.
  I have never encountered a time when the disconnect between rhetoric 
and reality has been so enormous. The President says he wants to save 
Social Security, yet he proposes a plan that

[[Page 7114]]

would cut benefits and privatize the program. Republicans in Congress 
say they want limited government, yet they enact legislation intruding 
on the end-of-life decisions for the poor woman in Florida. 
Congressional leaders say they want to support high moral standards in 
government, yet they gut the ethics process in the House. And in this 
so-called energy bill we shower billions on special interests while 
ignoring our Nation's serious energy needs.
  The Republican energy plan is a bonanza for the energy industry. 
While natural gas, heating oil, and gasoline prices have skyrocketed, 
we are going to be giving these companies more money. Shell Oil 
reported the highest corporate profits in the history of the United 
Kingdom. ExxonMobil announced the largest annual profit ever made by a 
public company, $25 billion.
  There are steps we could take to address our energy problems, but 
this legislation ignores them. We urgently need to reduce our 
dependence on foreign oil, yet America's dependence on oil imports will 
grow by 75 percent over the next 20 years under this bill.
  The bill fails to address the market abuse and manipulation that 
caused the California energy crisis, costing consumers in California 
and western States billions of dollars.
  This bill carves a loophole in the laws protecting our coastlines, 
our forests, and our public lands. And under this bill, when a big oil 
company pollutes community drinking water, the oil companies will no 
longer be held responsible for cleaning it up. It is a windfall for 
ExxonMobil, but an attack on communities all around this country facing 
contaminated drinking water.
  This bill makes the most significant changes to the Clean Air Act in 
15 years, allowing corporate polluters to expose 53 million Americans 
to air pollution for years longer than current law.
  I urge my colleagues to oppose this fundamentally flawed legislation.
  Mr. BARTON of Texas. Mr. Chairman, I yield 2 minutes to the gentleman 
from Missouri (Mr. Blunt), the distinguished majority whip and a member 
of the committee.
  Mr. BLUNT. Mr. Chairman, I thank the gentleman from Texas for 
yielding me this time to speak in favor of this bill, and I thank him 
for his great leadership to bring this bill to the floor.
  For 6 years now, the President of the United States has been saying 
that one of our primary failings as a country was to have an energy 
policy that moved forward. For three Congresses, our body has responded 
to that, first with the leadership of the gentleman from Texas as 
chairman of the subcommittee, and now with his leadership as chairman 
of the full committee, bringing an energy bill to the House floor for 
three straight Congresses.
  What we do here today and tomorrow can be extremely important to 
solve the problems that we see at the gas pumps today, to solve the 
problems that we see if you try to buy fertilizer today, to solve the 
natural gas problems.
  Now, it will not solve these problems next week or next month, or 
even maybe the month after that. If, however, we had passed the bill my 
colleague had brought to the floor 4 years ago, these problems we see 
today would not be the large problems that we see today. And for the 
leadership of this chairman, the leadership of the chairman of the 
Committee on Ways and Means, and the leadership of the chairman of the 
Committee on Resources, I am grateful.
  I am also grateful to our friends on the other side, led by the 
gentleman from Michigan (Mr. Dingell). They did the hard work they did 
in the markup. While they may not have agreed with all of the final 
product, certainly many parts of this product benefited from the work 
they did on this committee.
  One of the things we have done is illustrated here by a map that just 
shows how many kinds of fuel there are all over the United States. We 
have tried to limit the numbers of those fuels in this bill, and even 
asked the EPA to look to the future and see what that right number is.
  Every time you make gasoline less of a commodity and make it more of 
a specialty item, you increase the cost, reduce the reliability, and 
the access to gasoline. We hope to move away from that. We hope to do 
more things to use conservation and use renewable fuels.
  This is the right step. It is after the right time. I wish I could 
say it is the right step at the right time, but, Mr. Chairman, it is 
not the fault of our committee or our body.
  We need to move forward now. I urge passage of this bill.
  Mr. DINGELL. Mr. Chairman, I yield 3 minutes to the gentleman from 
Massachusetts (Mr. Markey).

                              {time}  1515

  Mr. MARKEY. Mr. Chairman, this is truly a bad bill. Every day we have 
pictures on the screen of consumers pulling up to the gas pump, paying 
an arm and a leg for gasoline. We have 150,000 young men and women over 
in the Middle East protecting our country in that region, and largely 
as well the oil supplies coming into our country.
  This bill does nothing in order to deal with that problem. In fact, 
the Department of Energy analysis of an almost identical bill in the 
last Congress concluded that changes to production, consumption, 
imports, and prices are negligible. The bill would open the pristine 
Arctic National Wildlife Refugee to oil and natural gas exploration 
even though there is such a small supply of oil and gas there that most 
of the oil companies have pulled out of the coalition trying to open it 
to drilling.
  This bill contains a liability waiver for the big oil companies that 
would force cities and States to spend billions to clean up drinking 
water supplies that have been contaminated with the gasoline additive 
MTBE which is known to cause cancer.
  This bill tramples on the right of State and local governments to 
protect their citizens from potentially dangerous energy facilities 
such as large liquefied natural gas terminals that would be sited right 
in the middle of densely populated cities in our country, even though 
we know they would be the number one terrorist target constructed in 
that city.
  This bill allows oil and gas companies to pollute drinking water by 
granting them special exemptions from the Clean Water Act.
  This bill allows refineries and utilities to increase air pollution 
with special exemptions from the Clean Air Act.
  There is a special provision in this bill to protect Halliburton from 
ever facing any Federal regulation of a practice of drilling for oil 
using the hydraulic fracturing technique that actually injects diesel 
fuel into the water supply.
  There is a special provision added that authorizes grants and other 
assistance to something called the Dine Power Authority, an enterprise 
of the Navaho Nation. Who are the beneficiaries of that provision? Why 
do they deserve our largess? We never had a hearing on it.
  There is a special provision in the bill that provides a $1.3 billion 
subsidy to the Idaho National Laboratory to build a special advance 
nuclear reactor to produce hydrogen for the hydrogen car. Bad bill; 
vote ``no.''
  Mr. Chairman, I rise in opposition to H.R. 6.
  I have the greatest respect and affection for the Chairman of the 
Committee, the distinguished gentleman from Texas (Mr. Barton), but I 
must say in all honesty that this is really a terrible energy bill.
  The Chairman comes from Texas, and I'm sure that from a Lone Star 
State perspective, this looks like a pretty good bill. But most of our 
constituents don't come from oil producing states. Most of our 
constituents are energy consumers, and from a consumer perspective this 
bill is seriously deficient. In fact, I would suggest that this bill is 
a bit like that old Clint Eastwood spaghetti Western: ``The Good, the 
Bad and the Ugly.''
  There is a tiny bit of good in the bill--like extending daylight 
saving time by a month in the Spring and a month in the Fall. Now, that 
was a good idea, it really was--and I'm glad that the gentleman from 
Michigan (Mr. Upton) and I were able to get it in the bill.
  But in all honesty I think I have to say that for the most part, what 
we have here before us today is one truly Bad and Ugly bill:
  First, let's take a look at the Bad:

[[Page 7115]]

  This bill does virtually nothing to address the current spike in 
crude oil prices or the price of gasoline at the pump. In fact, a 
Department of Energy analysis of an almost identical bill in the last 
Congress concluded that ``changes to production, consumption, imports 
and prices are negligible.''
  This bill would open the pristine Arctic National Wildlife Refuge to 
oil and natural gas exploration, even though there is such a small 
supply of oil and gas there that most of the oil companies have pulled 
out of the coalition trying to open it to drilling.
  This bill contains a liability waiver for the big oil companies that 
would force cities and states to spend billions to clean up drinking 
water supplies that have been contaminated with the gasoline additive 
MTBE, which is known to cause cancer.
  This bill tramples on the right of state and local governments to 
protect their citizens from potentially dangerous energy facilities, 
such as large Liquefied Natural Gas (LNG) terminals sited right in the 
middle of densely populated urban areas.
  This bill allows oil and gas companies to pollute drinking water by 
granting them special exemptions from the Clean Water Act.
  This bill allows refineries and utilities to increase air pollution 
with special exemptions from the Clean Air Act.
  This bill gives utilities who dam the public's waterways special 
rights to appeal and change conditions federal resource agencies placed 
on their hydropower license in order to protect fish, the 
environmental, irrigation, navigation or other public uses of our 
nation's rivers.
  This bill repeals the Public Utility Holding Company Act, a consumer 
and investor protection law that restricts utilities from self-dealing 
and limits their ability to diversify into risky unregulated business 
ventures at the expense of utility consumers.
  Second, let's take a look at the just plain Ugly.
  There's a special provision in this bill for Home Depot that preempts 
several states existing or proposed energy efficiency standards for 
ceiling fans.
  There's a special provision in here to protect Halliburton from ever 
facing any Federal regulation of the practice of drilling for oil using 
the hydraulic fracturing technique that actually injects diesel fuel 
into acquifers.
  There's the special provision added that authorizes ``grants and 
other assistance'' to something called ``the Dine Power Authority, an 
Enterprise of the Navajo Nation.'' Who are they? Why do they deserve 
our largess?
  There's the special provision added that provides a special exemption 
from our Nation's nuclear nonproliferation law for a Canadian company 
named Nordion, so that they won't be required to ever agree to convert 
their nuclear reactor to using Low-Enriched Uranium fuel and targets, 
but can instead continue to use bomb-grade Highly Enriched Uranium that 
is a potential terrorist target.
  There's the special provision in the bill that provides a $1.3 
billion subsidy to the Idaho National Laboratory to build a special 
advanced nuclear reactor to produce hydrogen for the hydrogen car.
  This is not what a national energy policy should be--a tiny bit of 
Good in a sea of Bad and Ugly provisions. No. We should try to seek a 
fair balance between the interests of consumers and producers, between 
the need for new production and the preservation of our natural 
environment. We should take advantage of America's strength--our 
technological superiority--and not play to our weakness (the fact that 
we control only 3 percent of the world's oil reserves, while OPEC 
controls more than 70 percent).
  Americans own more cars than there are licensed drivers, and yet this 
energy bill does nothing to address the fuel efficiency of cars. 
Instead this bill offers up the false hope that drilling in the Arctic 
Refuge will solve our energy problems, ignoring that the United State's 
3 percent of world oil reserves will never match our 25 percent of 
world oil consumption. For some fuzzy math, we would sacrifice the last 
great wilderness in America, an area biologically unique within the 
American Arctic.
  It didn't have to be this way. I lived through the energy policy 
battles of the late It didn't have to be this way. It really didn't. 
But the Republican Majority that controls this Congress today decided 
to make energy policy partisan with a bill that is extreme and over-
reaching. So I would say to my Republican Colleagues, you may have the 
votes to prevail here on the House floor this week, but this extreme 
bill will not become law. Democrats in this body, along with our 
colleagues in the Senate, will fight to ensure that the Bad and Ugly 
provisions that presently make up the bulk of this bill are deleted or 
revised. And if they are not, we will fight to prevent this bill from 
moving to the President's desk.
  I urge my colleagues to vote against this bill. We can and must do 
much better.
  Mr. BARTON of Texas. Mr. Chairman, I yield 2 minutes to the gentleman 
from Illinois (Mr. Shimkus).
  Mr. SHIMKUS. Mr. Chairman, I thank the gentleman from Texas (Mr. 
Barton) for yielding me this time and for his great work on this bill. 
It sounds like it is not the bill that I voted on, but I am very 
pleased to support it. There is no more important bill in my time here 
in Congress than the bill we are addressing today, and there is no more 
important bill for the State of Illinois than the bill we are 
addressing today. It makes all of the years of our work pay off because 
I think this time we will get it across the finish line because it 
meets the demands of the country. We have to diversify our energy 
portfolio. We can no longer rely on one fuel source, whether it is for 
electricity generation or to move our vehicles. We have to diversify 
our energy portfolio, and that is what this bill does.
  This bill brings clean coal technology, strengthens nuclear power; 
and it actually helps renewable power in the aspect of wind power. It 
does great things for relicensing hydroelectric power. It helps expand 
the transmission grid and block the backlogs that helped cause the 
major blackout that we had 2 years ago. It addresses a diversified 
energy portfolio on fuels.
  It brings renewable fuels to the forefront in this debate. Gasoline 
is $2.20, $2.30. Consumers can buy E-85 ethanol fuel for $1.65 a 
gallon. So what we have been doing in the past is working. This bill 
addresses the supply end, and it also addresses the demand end. We have 
to have a national energy policy. We can no longer allow the country to 
not have a plan.
  I am excited about an opportunity to pass this bill on the floor 
tomorrow, move it to conference, and get it to the President's desk. I 
want to commend the bipartisan majority that passed it out of the 
committee, and commend the chairman for his work.
  Mr. DINGELL. Mr. Chairman, I yield 1\1/2\ minutes to the gentlewoman 
from California (Mrs. Capps).
  Mrs. CAPPS. Mr. Chairman, I rise in opposition, strong opposition to 
this bill. My colleagues have outlined the many problems with it. It 
does nothing to impact gas prices. In fact, according to the Energy 
Information Agency, it will raise prices at the pump. It gives billions 
to industries with already-soaring profits, and it weakens a host of 
environmental laws.
  Mr. Chairman, one provision epitomizes the bill's failures. H.R. 6 
grants liability protection for people who make MTBE who are 
responsible for polluting groundwater in dozens of States, leaving 
hundreds of communities saddled with billions of dollars in cleanup 
costs. Supporters claim it is fair to protect MTBE producers from 
liability since Congress mandated its use in the Clean Air Act, but 
there is no mandate for MTBE and even the chairman of the committee has 
acknowledged as much. In fact, 120 million barrels were added to 
gasoline before the clean air regulations were ever issued. Most 
damning, documents unearthed in court cases show that manufacturers 
knew the dangers MTBE posed to groundwater, and they still added it to 
gasoline. The result is what we have today, over 1,800 contamination 
sites in 29 different States serving 45 million Americans.
  I wanted to offer an amendment to strike this provision because in 
its wisdom the House leadership would not want to vote on this. Perhaps 
it is because too many Members on both sides of the aisle represent 
districts with bad MTBE problems in places where lawsuits are pending. 
Because of the MTBE provisions alone, we should reject this bill.
  Mr. BARTON of Texas. Mr. Chairman, I yield 2 minutes to the gentleman 
from Texas (Mr. Gene Green), one of nine Democrats on the Committee on 
Energy and Commerce who voted for this bill in committee.
  Mr. GENE GREEN of Texas. Mr. Chairman, I thank the gentleman for 
yielding me this time.
  There was pressure to rush this bill out of the committee without a 
markup, but I am glad the committee made the right decision. We had a 
3-day full

[[Page 7116]]

committee markup where almost every imaginable energy issue was raised, 
from cow manure energy to ocean power. We even extended daylight 
savings time to save energy.
  Overall, there are many beneficial provisions in this bill, such as 
resolving permit confusion, improving electric reliability, and 
mandating Federal energy conservation.
  Importantly, this bill provides incentives to clean coal technology, 
renewable energies like wind and solar; and it also increases LIHEAP 
funding authorization to $5 billion for this year.
  Very quickly, I want to thank the chairman for inclusion of a number 
of provisions in the bill, such as the provision encouraging the siting 
on liquefied natural gas (LNG), which is important to energy security 
to cut into the rising natural gas prices that threaten our economy.
  The top concern of homeowners and manufacturers in our district are 
the high natural gas prices. If we keep offshore production limits, we 
have to have LNG to import from other countries. We included some 
modern incentives for petroleum coke gasification so we can see what we 
can do with basically a byproduct, and important coal gasification 
incentives. Energy diversity brings economy-wide benefits.
  I commend the authorization of a complex well-testing project at the 
Rocky Mountain Oilfield Testing Center. The ability to tap more 
resources with fewer wells provides a public benefit for environmental 
protection.
  The bill contains a study on LIHEAP reform. Providing energy 
assistance to families in cold and hot weather is a public necessity, 
and I thank the gentleman from Michigan (Mr. Dingell) and the gentleman 
from Texas (Chairman Barton) for accepting two new amendments, one 
which would require the Department of Energy and the National Cancer 
Institute to conduct a health assessment of those living in proximity 
to petrochemical and refinery facilities.
  Many of my constituents live and work near these facilities. The 
communities are concerned, and they deserve the most accurate health 
information about their community.
  There is a lot to be said about this bill. We have an energy bill for 
the first time in my 12 years in Congress.
  Mr. DINGELL. Mr. Chairman, I yield 1\1/2\ minutes to the gentlewoman 
from California (Ms. Solis).
  Ms. SOLIS. Mr. Chairman, today I rise in opposition to the energy 
bill. The bill limits States' rights to protect their water supplies 
and protect their air quality, risks the public health of our working 
families, and leaves our States to pick up the tab for contamination.
  First, the bill puts important groundwater supplies at risk by 
allowing diesel fuel and other contaminants to be injected into the 
ground with no oversight by EPA.
  Second, supporters of the bill refuse to take steps to prevent leaks 
into the groundwater from underground storage tanks by rejecting 
attempts to require new replacement storage tanks near drinking water 
wells or sensitive areas to be secondarily contained.
  Third, the bill would make States weaken programs to prevent leaks 
during fuel delivery or risk losing Federal cleanup funds.
  Finally, the language unnecessarily targets poor and underserved 
communities for the unrestricted siting of new refineries. Together, 
all these actions are environmental and public health injustices. While 
the bill benefits corporate America, it leaves communities like mine 
with more contaminated groundwater, increases the cost of cleanup borne 
by taxpayers and water providers, and increases the risks to public 
health for all Americans.
  Mr. BARTON of Texas. Mr. Chairman, I yield 1 minute to the gentleman 
from Indiana (Mr. Buyer).
  Mr. BUYER. Mr. Chairman, I thank the gentleman from Texas (Mr. 
Barton) for yielding me this time. The gentleman has done a magnificent 
job leading the committee on this new bill.
  I would just say, in America we face some great challenges with 
regard to formulation of our energy policy. The oil demand growth keeps 
rising due to the industrialization of the emerging world. China 
consumes 7 million barrels per day; and if China's rise in world 
prominence is similar to that of Korea and Japan, China will consume 20 
million barrels per day in less than 10 years.
  The last big oil discovery was 30 years ago in the North Sea. China 
is trying to buy oil companies in Canada; India is trying to buy oil 
companies in Russia; the present world production capacity is 83 
million barrels a day; and we are running an estimated 81.5 million 
today, which means we are in the red zone. The 14 largest oil fields in 
the world are 40 years old. Once they are taken out to 50 percent, 
water and fluids need to be pumped to keep production at existing 
levels. We have some significant challenges. Support this bill.
  Mr. DINGELL. Mr. Chairman, I reserve the balance of my time.
  Mr. BARTON of Texas. Mr. Chairman, I yield for the purpose of a 
unanimous consent request to the gentleman from Connecticut (Mr. 
Shays).
  Mr. SHAYS. Mr. Chairman, I rise in opposition to the legislation.
  Mr. Chairman, protecting our environment and promoting energy 
independence are two of the most important jobs I have as a Member of 
Congress. Unfortunately, the bill before us today represents a real 
missed opportunity to reduce our dependence on foreign oil, promote 
energy efficiency and conservation, and improve our air, land and water 
quality.
  For decades, our country has lacked a national energy policy. While I 
did not agree with the Administration's energy plan, I was grateful 
President Bush put forward a comprehensive proposal. The President's 
energy plan was superior to the severely flawed bill before us today.
  We had a chance to devise a forward-looking energy policy that would 
have increased fuel efficiency, made polluters (including MTBE 
producers) pay for harming our environment, and advanced a renewable 
portfolio standard. Instead what we have is quite a bad bill.
  Instead of creating a balanced energy policy that provides incentives 
to make renewable energy more affordable and widely available, we are 
making fiscally irresponsible and environmentally-reckless decisions 
for the benefit of a few profitable industries that don't need this 
kind of help from taxpayers.
  I fail to understand why the major thrust of the bill's tax 
provisions involve further subsidizing the fossil fuel industry, rather 
than providing incentives for conservation and renewable sources of 
energy. These are enormously profitable industries operating in a time 
of record energy prices. Clearly, these profits demonstrate the market 
has already provided the fossil fuel industries with sufficient 
incentive to increase production.
  I strongly oppose a provision in the bill that allows for the 
permanent activation of the Cross Sound Cable. In doing so, the bill 
subverts the regulatory process and ignores sound environmental policy 
regarding the depth at which the Cable should be buried.
  In addition to its environmental shortsightedness, I also oppose 
provisions in this bill related to energy transmission. For instance, 
the Energy Policy Act allows the Federal Electric Regulatory Commission 
(FERC) to preempt state siting authorities when it is determined that a 
high-voltage power line is of ``national significance,'' and overrides 
state authorities when expanding or siting new liquefied natural gas 
(LNG) terminals. In our own Long Island Sound just off Connecticut, 
this is a very real possibility. While energy security is a national 
issue, it seems to me the communities who will live with these siting 
decisions deserve a voice in the process.
  Finally, I strongly oppose opening the Arctic National Wildlife 
Refuge to drilling. We simply won't have a world to live in if we 
continue our neglectful ways. In my judgment, it would be far better to 
develop prudent and lasting alternate fuel energies than to risk 
irreparable damage to the wilderness of one of North America's most 
beautiful frontiers. Drilling in the Arctic will not fix our energy 
problems--with so little oil available up there it couldn't possibly, 
as it will take a decade to get the oil down here. That time would be 
far better spent developing clean, renewable energy sources that will 
provide infinite energy without imperiling our last remaining 
wilderness areas.
  I look forward to the day when we will have an opportunity to vote 
for a fiscally-prudent, environmentally-responsible national energy 
policy. Today is not that day.
  Mr. BARTON of Texas. Mr. Chairman, I yield 1 minutes to the gentleman 
from Florida (Mr. Stearns), a distinguished subcommittee chairman.

[[Page 7117]]


  Mr. STEARNS. Mr. Chairman, here we go again. As I said, this is the 
third time, and it should be a charm.
  We have passed this comprehensive legislation before; and I know I 
speak for a lot of my colleagues, probably on both sides of the aisle, 
that we should finally move forward after the large increases in 
gasoline. This is a timely piece of legislation.
  The Department of Energy predicts by the year 2025, U.S. oil and 
natural gas demand will rise by 46 percent with energy demand 
increasing 1 percent for every 2 percent in GDP growth. This increase 
in demand at home, coupled with the explosion of demand worldwide, has 
led to the increase in the cost of crude oil.
  To combat this, and the resulting record gas prices, the American 
people today are looking for Congress to act and we are doing it. This 
legislation contains a number of provisions that would lower gas 
prices. H.R. 6 encourages more domestic production of oil, promotes a 
greater refining capacity, and increases the gasoline supply by 
stopping the proliferation of expensive regional boutique fuels.

                              {time}  1530

  Mr. Chairman, I urge my colleagues to support H.R. 6 and finally 
enact solid, comprehensive energy legislation for the American people.
  Mr. Chairman, here we go again. As they say, the third time's the 
charm. This is the third Congress in a row we have tried to pass 
comprehensive energy legislation. I know I speak for many of my 
colleagues in saying I hope we can finally move forward and enact this 
very important and increasingly timely legislation.
  As we all know too well, energy is the lifeblood of the economy. The 
availability of energy at reasonable prices is key to economic growth 
and stability. Comprehensive national energy policy must ensure 
affordable, reliable energy and also promote national security. H.R. 6 
does that and I urge all my colleagues to support it.
  The Department of Energy predicts that by the year 2025, U.S. oil and 
natural gas demand will rise by 46 percent, with energy demand 
increasing 1 percent for every 2 percent growth in GDP. This increased 
demand at home, coupled with an explosion of demand worldwide, has lead 
to an increase in the cost of crude oil. To combat this and the 
resulting record gas prices, the American people are looking to 
Congress to act.
  This legislation contains a number of provisions that would lower gas 
prices. H.R. 6 encourages more domestic production of oil, promotes a 
greater refining capacity, and increases the gasoline supply by 
stopping the proliferation of expensive regional boutique fuels.
  Ending our dependence on foreign oil is not only important to the 
economy but also doubly important to national security. Currently, the 
U.S. imports about 60 percent of its oil. The Department of Energy 
projects this number will increase to 73 percent by the year 2025. In 
order to ensure reliable and secure supplies of oil, we have no choice 
but to increase the domestic supply.
  Another way H.R. 6 increases domestic production of oil is by opening 
ANWR to oil and gas exploration. USGS estimates that there is between 
5.7 and 16.0 billion barrels of oil that is technically recoverable. 
This estimate does not take into account that with new technology, the 
share will become higher. A resource of this magnitude cannot simply be 
ignored. H.R. 6 goes a long way to end our reliance on foreign oil.
  I once again urge my colleagues to support H.R. 6 and finally enact 
solid, comprehensive energy legislation for the American people.
  Mr. BARTON of Texas. Mr. Chairman, I yield 1 minute to the gentleman 
from Ohio (Mr. Gillmor), another distinguished subcommittee chairman.
  Mr. GILLMOR. I thank the gentleman for yielding me this time and for 
his great work on this bill.
  Mr. Chairman, this country needs to create a new energy landscape 
that begins shrinking our disproportionate reliance on foreign energy 
sources and begins building one that places American ingenuity, 
producers and consumers at the forefront.
  I want to highlight one provision and that is the provision that 
significantly strengthens the important Leaking Underground Storage 
Tank program. The bill increases State funding from the LUST trust fund 
for States containing a larger number of tanks or whose leaking tanks 
present a greater threat to groundwater, it requires onsite inspections 
of underground storage tanks every 3 years, it institutes operator 
training requirements for tank owners and operators, and the 
legislation allows States to stop deliveries of fuel to noncompliant 
regulated tanks in order to achieve legal enforcement.
  These are all strong recommendations not only made by the General 
Accounting Office, but they have also been previously passed by the 
House. They are proenvironment, antipolluter provisions. I urge their 
support and the support of the bill.
  Mr. BARTON of Texas. Mr. Chairman, I yield 1 minute to the gentleman 
from Michigan (Mr. Upton), another distinguished subcommittee chairman.
  Mr. UPTON. Mr. Chairman, yes, we have an energy crisis, and the sad 
thing is that it did not start this year, but neither did this bill 
which started more than 4 years ago. Maybe with gas prices hovering 
near $2.50 a gallon, we can finally get this bill to the President's 
desk.
  I was glad to see that my bipartisan amendment extending daylight 
saving time for 2 months was included in this bill. Estimates show that 
it will save more than 100,000 barrels of oil for every day that we 
extend daylight saving time. I want to remind my colleagues that 2 
years ago, we had a blackout, an electric blackout through much of the 
Midwest. In this bill we finally impose reliability standards on the 
electric industry so that, hopefully, that will not happen again.
  I want to say, too, as the cochair of the Auto Caucus, it was 
important for the chairman to agree to add $200 million for hybrid and 
alternative fuel cell vehicles. We hope that the Senate legislation 
will even go more in terms of incentives so that private consumers 
going to the showroom are going to be able to take advantage of those 
incentives to purchase those vehicles so that we can get those on the 
road.
  Mr. DINGELL. Mr. Chairman, I yield the balance of my time to the 
distinguished gentleman from Virginia (Mr. Boucher).
  Mr. BOUCHER. Mr. Chairman, I want to thank the gentleman from 
Michigan for yielding this time to me and commend him on his 
outstanding leadership with regard to the energy bill now before us.
  I have supported the passage of comprehensive energy legislation for 
the last two Congresses, and I rise in support of the measure that is 
before the House this afternoon. While I do not support all of the 
sections of the bill, there are a number of provisions in the energy 
measure that I believe will enhance our Nation's energy policy and 
energy security. For example, the legislation makes valuable 
improvements in the area of energy efficiency and renewable energy and 
would make permanent the Northeast Home Heating Oil Reserve.
  Of particular interest to me is the title on coal which would provide 
for the implementation of the Clean Coal Power Initiative to develop 
projects that would utilize clean coal technologies. The coal title 
also provides for the clean air coal program to enhance the deployment 
of fully developed clean coal technologies. Coal is our Nation's most 
abundant natural resource for energy production, and it is appropriate 
that we take steps to accomplish the goal of incenting coal use and 
thereby relieving to some extent the pressure that we are experiencing 
at the present time on natural gas prices. The Clean Air Coal Program 
would help to advance that objective.
  The electricity title in the energy bill contains some beneficial 
provisions, and I particularly want to call attention to the smart 
metering title which I proposed 2 years ago in order to accelerate the 
deployment of real-time metering. When consumers have knowledge of the 
savings they can realize by using appliances during offpeak hours, the 
peaks can be flattened and the utilities can avoid the necessity of 
having to build some very expensive new generating facilities.
  I am pleased that during the last Congress, we were able to reach a 
compromise which is also reflected in the bill before us today 
regarding the application of section 210 of PURPA, and

[[Page 7118]]

the legislation contains the noncontroversial and much-needed section 
that would make transmission reliability standards mandatory.
  I am concerned, however, that the bill before us includes a provision 
that would cap spending on the implementation of the reliability 
standards. I am concerned about that and would hope that when this 
measure becomes law, enough money will be available for adequate 
enforcement.
  I also remain concerned about the total repeal of the Public 
Utilities Holding Company Act without ensuring that adequate consumer 
protections remain in place. And I have not been convinced that there 
is a need to give the Federal Energy Regulatory Commission the ultimate 
authority to site transmission power lines.
  I support the legislation and I encourage my colleagues to vote for 
it. I want to conclude these remarks by complimenting again the 
gentleman from Michigan (Mr. Dingell) on his outstanding leadership and 
also complimenting the gentleman from Texas (Mr. Barton) of the 
Committee on Energy and Commerce. He was willing to work in a 
bipartisan fashion in order to establish consensus on a number of these 
measures. I applaud him for that willingness and for the effective work 
that he has done in bringing this measure to the floor.
  Mr. Chairman, I encourage the passage of the bill.
  Mr. BARTON of Texas. Mr. Chairman, I yield myself the balance of my 
time.
  The Acting CHAIRMAN (Mr. Latham). The gentleman from Texas is 
recognized for 1 minute.
  Mr. BARTON of Texas. Mr. Chairman, I want to compliment the members 
of the Committee on Energy and Commerce on both sides of the aisle for 
the way we prepared this legislation. It was reported out of committee 
39-16 last Wednesday night after a 3\1/2\-day markup. Every amendment 
that was offered that wanted to be voted on and considered was.
  Most of the members who have spoken in opposition to the bill on the 
floor from the Committee on Energy and Commerce had amendments that 
were accepted in committee. I think every member that has said 
something negative about the bill actually got something in the bill, 
and yet it was not exactly the way they wanted it in terms of the total 
package, so they are obviously reserving their right to vote against 
the bill.
  It is a fair and balanced bill. It helps the existing conventional 
resources. It also has a title on conservation. It will reform our 
electricity grid. It looks to the future in the hydrogen fuel 
initiative and the clean coal technology. While it is not a panacea, it 
is a bill that is right for this country. It is right to pass it at 
this time and send it to the other body so that we can go to conference 
later this summer and put a bill on the President's desk.
  I would urge a ``yes'' vote on final passage after all the amendments 
have been debated tomorrow afternoon.
  Mrs. BIGGERT. Mr. Chairman, I claim the time on the majority side for 
the Committee on Science.
  The Acting CHAIRMAN. The gentlewoman from Illinois is recognized.
  Mrs. BIGGERT. Mr. Chairman, I yield myself 3 minutes.
  As chairman of the Science Subcommittee on Energy, I rise today in 
strong support of H.R. 6, the Energy Policy Act of 2005, particularly 
those provisions that originated with the Science Committee and are now 
contained in Title IX of the bill, the Research and Development title.
  H.R. 6 represents a good investment in advanced, cutting-edge energy 
technologies to expand and diversify our energy supply, meet growing 
demand and reduce the environmental impact of energy production and 
use. The only changes to the R&D title from the 108th Congress are ones 
that reflect the latest research, the emergence of innovative 
technologies and new ways of thinking about our power problems.
  Most noteworthy is a pilot grant program to encourage the design and 
construction of energy-efficient buildings that demonstrates new 
efficiency technologies. Also worth mentioning are two new additions to 
the subtitle on renewable energy R&D.
  First is a grant program for States to support the development and 
demonstration of solar technologies nationwide. Second, the bill 
requires the Department to work with industry to create biorefinery 
demonstration projects. As a result, this bill does more for renewable 
energy R&D than any other energy bill previously considered by the 
House.
  The bill also recognizes that advanced energy technologies do not 
grow on trees. Instead, they grow out of basic scientific research like 
those that are supported by the DOE at our universities and national 
laboratories. That is why H.R. 6 increases authorized funding to the 
DOE Office of Science which supports over 40 percent of basic research 
in the physical sciences, more than any other Federal agency. This 
funding will support basic fusion research and greater use of 
supercomputers for energy applications, as well as systems biology 
research and the construction and operation of scientific facilities 
like the rare isotope accelerator.
  America cannot hope to compete in the world economy based on labor 
costs. Our competitive strength is the depth of our ingenuity and 
technology, and the science programs in this bill are the basic 
building blocks of our technological edge.
  In closing, I want to thank the leadership of the Committee on 
Science and my colleagues on the committee for their contributions to 
the development of the provisions in the R&D title of H.R. 6.
  Mr. Chairman, I reserve the balance of my time.
  Mr. GORDON. Mr. Chairman, I yield myself such time as I may consume.
  First I would like to thank the gentleman from New York (Mr. 
Boehlert), chairman of the Committee on Science, and the gentlewoman 
from Illinois (Mrs. Biggert), chair of the Subcommittee on Energy, for 
their hard work and cooperation in developing the foundation of Title 
IX, the R&D title of this bill.
  A stable domestic energy supply is essential to the economic well-
being and security of our Nation. While the bill on the floor today has 
provisions that are not acceptable to many Democrats and Republicans, 
there are good points worth mentioning in Title IX. Of particular note 
are the provisions ensuring greater DOE cooperation with the smaller 
colleges and universities who will train our next generation of 
scientists, mathematicians, technicians and teachers. The Department, 
as well as the traditional large research universities, could benefit 
from the enormous pool of talented researchers in the Nation's smaller 
colleges and universities, and I encourage greater collaboration.
  I would also like to highlight the work of several of our Members on 
key components of DOE research and development in Title IX:
  The interest of the gentleman from California (Mr. Honda) in the 
progress of the Next Generation Lighting Initiative, the Stanford 
linear accelerator and the Joint Genomics Institute and his work with 
the gentleman from Connecticut (Mr. Larson) on transit bus 
demonstrations of fuel cells;
  The continued dedication of the gentlewoman from California (Ms. 
Woolsey) and the gentleman from Colorado (Mr. Udall) to clean, 
renewable and efficient energy technologies;
  The work of the gentleman from Illinois (Mr. Costello) to ensure that 
utilization of our vast coal resources only gets cleaner and more 
efficient;
  The vision of the gentlewoman from California (Ms. Zoe Lofgren) in 
support of domestic fusion energy research and international fusion 
projects;
  The work of the gentleman from Tennessee (Mr. Davis) to ensure good 
science continues at Oak Ridge National Laboratory, particularly in the 
area of high-end computing;
  The efforts of the gentleman from North Carolina (Mr. Miller) to 
establish a nationwide network of advanced energy technology transfer 
centers to get technologies off the laboratory shelf and into the 
marketplace;
  Finally, the tireless commitment of the gentlewoman from Texas (Ms. 
Jackson-Lee) to research and development at historically black colleges 
and

[[Page 7119]]

universities and other minority-serving institutions.
  The Committee on Science contributed virtually all of Title IX, the 
research and development title of this bill. While research and 
development programs typically have not been controversial, I believe 
the Title IX provisions represent a major part of this legislation. The 
R&D programs authorized in this bill will provide the means to produce 
energy that this country will need for the foreseeable future.
  Mr. Chairman, I reserve the balance of my time.
  Mrs. BIGGERT. Mr. Chairman, it gives me great pleasure to yield 5 
minutes to the gentleman from New York (Mr. Boehlert), the illustrious 
chairman of the Committee on Science.
  Mr. BOEHLERT. Mr. Chairman, with great regret, but with even greater 
conviction, I rise in opposition to this bill. While this bill 
certainly has some worthy provisions, including those reported out by 
our committee, overall this bill is a step backward. This bill will not 
lessen our dependence on foreign oil, and it will do nothing to reduce 
energy prices. It will increase the deficit, weaken our economy, 
compromise our national security and endanger our environment.
  The supporters of this bill are certainly right about one thing. We 
desperately need a good national energy policy. This measure does not 
pass that test.

                              {time}  1545

  Our growing dependence on foreign oil puts us at the mercy of 
unstable and unfriendly foreign regimes. It gives terrorists additional 
targets and puts money in their hands. It weakens the dollar by 
worsening the balance of trade. We would start every day $500 million-
plus in the hole on our balance of trade because of the imported oil. 
It pumps money out of the domestic economy and into the hands of those 
who would wish us ill.
  In short, our oil dependence represents a significant and growing 
threat to our national security, and national security should be first 
and foremost in the minds and hearts of everyone in this Chamber.
  So what do we do to reduce our dependence on foreign oil? Yes, we 
need to increase the supply of fossil and nuclear and renewable energy.
  But most importantly, we need to become more energy efficient. And 
does this bill do to make us more energy efficient? Virtually nothing.
  The Federal Energy Information Administration found that last year's 
energy bill would have almost no impact on energy demand and energy 
prices; and that bill, if anything, made more of an effort to tame 
consumption. The Alliance for an Energy Efficient Economy has estimated 
that this year's energy bill would not save a single barrel of oil by 
2020.
  That is both tragedy and farce. We know how to treat our oil 
addiction. We can make appliances more energy efficient without 
inconveniencing anyone. We can make our cars more efficient without 
sacrificing safety. My CAFE amendment would reduce oil consumption in 
2020 by 2 million barrels a day. That is more than twice the amount 
that is expected per day from drilling in the Arctic National Wildlife 
Refuge.
  What does this bill do instead of trying to make us more energy 
efficient? At a time of fiscal crises and record oil prices, the bill 
provides new mandatory spending that will go directly to the oil 
industry, and it provides mandatory breaks for the oil industry on 
royalties.
  The bill provides massive tax breaks for profitable oil companies and 
next to nothing for new technologies that could help wean us from 
foreign oil. Here is what the President said last week on that issue: 
``With $55 oil we don't need incentives to oil and gas companies to 
explore.'' The President's budget devoted 72 percent of its proposed 
energy tax incentives to alternatives. This bill provides just 6 
percent to alternatives while providing more than a billion dollars in 
additional tax breaks.
  We would not have to look far to come up with better ideas. While the 
House has been writing a bill based on ideological purity rather than 
careful analysis, others have come forward with bipartisan, sensible 
balanced approaches to energy policy. Groups like the National 
Commission on Energy Policy and the Alliance to Save Energy and the 
Energy Future Coalition have all offered carefully considered proposals 
that could have formed the basis of an effective bill with Republican 
credentials.
  But instead, we have decided to close our minds and open our purse in 
a way that will harm taxpayers and consumers and weaken our economic 
health and national security.
  We can do better. We ought to do better. We have an obligation to do 
better. Let us defeat this bill and start over.
  Mr. GORDON. Mr. Chairman, I yield 1\1/2\ minutes to the gentlewoman 
from California (Ms. Woolsey).
  Ms. WOOLSEY. Mr. Chairman, the chairman of the Committee on Science 
knows what is right. The energy bill before us today is bad for the 
consumer, bad for the environment, and it does not make us energy 
independent. In fact, it is the ultimate reason we are insecure as a 
Nation.
  In fact, by promoting the interests of corporations over consumers 
and pollution over conservation, this bill makes the United States much 
less secure.
  H.R. 6 will harm more than just our environment, however. America's 
continued reliance on Middle East oil for the majority of our energy 
needs is the single largest factor that contributes to our lack of 
national security. It is time we stopped all efforts to drill in ANWR 
because this is only a stop-gap measure. Instead, we need real energy 
independence, and that will only come when we start focusing our 
efforts as a Nation on clean, renewable sources of energy, 
conservation, and efficiency. It would be hypocritical for anyone who 
cares about our Nation's well-being to vote for this legislation. I 
urge my colleagues, join me, vote against it.
  Mrs. BIGGERT. Mr. Chairman, I yield 2 minutes to the gentleman from 
South Carolina (Mr. Inglis), a member of the Committee on Science.
  Mr. INGLIS of South Carolina. Mr. Chairman, I thank the gentlewoman 
for yielding me this time.
  Mr. Chairman, I agree with the chairman of the Committee on Science. 
We have an opportunity to do better.
  I hope that we do better as we improve the hydrogen title of this 
bill. Perhaps the other body will have a title that will work a little 
bit better in the hydrogen area, and I hope that we will catch the 
vision of a different way of getting around.
  Imagine that one takes delivery today in Spartanburg, South Carolina 
of a brand new BMW. It runs on hydrogen. It is powered and controlled 
by a computer, maybe made by IBM, maybe software by Microsoft. These 
are companies committed to making hydrogen and to making smart cars 
work. They get in the car, they program it to go somewhere, they take 
their hands off the wheel. It seems like science fiction, but the good 
news is that we on the Committee on Science are in the business of 
making science fiction into reality, and it is not that far away.
  If we can make a commitment like we made when we decided to go to the 
Moon, we can get there. We as a Nation can decide that now is the time 
to really commit to forging ahead to create a hydrogen economy. Now is 
the time to be spending good money on that. It is time to stop simple 
spending and start thoughtful investing. There is a big difference. In 
this bill we have the opportunity to do just that, to invest serious 
money in the technology that can lead us to a hydrogen economy. If we 
do that, we will do good work for the American people and we will 
lessen our dependence on Middle Eastern oil.
  And, by the way, it is also about jobs. If we can retool the 
automobile and make it so that we not just develop the technology but 
also produce it here, we can tremendously expand the economy of the 
United States, providing jobs and, while doing that, cleaning up the 
environment and reducing the oil pressure on the Middle East. That is a 
trifecta. Let us get about it with a better title.
  Mr. GORDON. Mr. Chairman, I yield 2\1/2\ minutes to the gentleman 
from California (Mr. Honda).

[[Page 7120]]


  Mr. HONDA. Mr. Chairman, there are very few things I like about this 
energy bill. However, I do support title IX, and I am proud to be the 
ranking member of the Committee on Science's Energy Subcommittee, which 
authored this portion of the bill.
  We have included such beneficial programs as energy efficiency and 
renewable energy research and development in the areas of solar, wind, 
geothermal, bioenergy, and other alternative energy sources that will 
be critical to our future energy independence.
  Also included are research programs into distributed energy and 
electric energy systems, which will make us less reliant on fragile 
transmission grid, and the next generation lighting initiative, which 
will reduce future demand for electricity through efficiency.
  We have also increased support for the basic sciences at the 
Department of Energy generally and focused on several programs in 
particular, such as nanotechnology research and development, advanced 
scientific computing research, and fusion energy sciences.
  It is a credit to the collegial bipartisan nature of the Committee on 
Science members and staff that all of these important provisions are 
included in a product that both sides of the aisle can support. There 
is so much agreement that I do not have any amendments to offer here 
today; and as a side bar, I would like to also commend the gentleman 
from New York (Mr. Boehlert), chairman; and the gentleman from 
Tennessee (Mr. Gordon), our ranking member, for this kind of collegial 
activity.
  Unfortunately, I cannot say the same thing about the rest of the 
bill. Drilling in the Arctic National Wildlife Refuge and liability 
waivers for producers of MTBE are not going to reduce gas prices today 
and are not steps toward a sustainable energy future. And in contrast, 
the bill does not address increasing fuel economy standards, which is a 
concrete step we can take to reduce energy consumption.
  Even President Bush, an oil man, admits that with $55 a barrel of 
oil, we do not need incentives for oil and gas companies to explore. He 
recently said, ``There are plenty of incentives. What we need is to put 
a strategy in place that will help this country over time become less 
dependent.''
  This bill does not do enough to make this Nation less dependent on 
energy, be it from imported or domestic sources. We need a bill that 
focuses on our long-term future needs, not one that is stuck in the 
past.
  I urge my colleagues to oppose this bill.
  Mrs. BIGGERT. Mr. Chairman, I yield for the purpose of making a 
unanimous consent request to the gentleman from Illinois (Mr. Kirk).
  Mr. KIRK. Mr. Chairman, I am concerned this bill will not clear the 
Budget responsibility.
  H.R. 6 technically does not violate the Budget Act because it is an 
unreported bill, and Budget Act points of order generally only apply to 
reported bills. The bill generally is inconsistent with the 302(a) 
allocations for both the 2005 and House-passed 2006 budget resolutions. 
Section 2053 of the bill does, however, create a new entitlement 
program outside the budget window (specifically, FY 2016). It uses a 
portion of outer-continental receipts to fund new mandatory state-run 
conservation, education, and infrastructure programs. Estimates 
indicate that the annual cost of this provision could be in the range 
of $1.75 billion. If H.R. 6 were a reported bill, such a provision 
might subject the bill to a section 303 point of order.
  We just passed a Budget only after clarifying a point of order would 
defeat any Appropriations bill over Budget.
  It appears that we have to expand this point to protect against bills 
like this.
  Mr. GORDON. Mr. Chairman, I have no further requests for time, and I 
yield back the balance of my time.
  Mrs. BIGGERT. Mr. Chairman, I yield myself such time as I may 
consume.
  In closing, I express my appreciation for the leadership of the 
Committee on Science and my colleagues on the committee for their 
contributions to the development of the provisions in the R&D title of 
H.R. 6. They are bipartisan, forward thinking, balanced, and speak to 
the importance that we as a Congress place on the role of technology in 
our energy future.
  I would also express my appreciation for the extremely professional 
staff of all the relevant committees, as well as the key leadership 
staff who worked diligently on this bill for months and in some cases 
years. I want to thank the able staff of Committee on Science and its 
Energy Subcommittee. Their contributions and those of countless others 
have resulted in a better bill which I urge my colleagues to support.
  Mr. Chairman, I yield back the balance of my time.
  Mr. GORDON. Mr. Chairman, I ask unanimous consent to take back the 
balance of my time for the purpose of yielding time to the gentlewoman 
from Texas (Ms. Jackson-Lee).
  The Acting CHAIRMAN (Mr. Latham). Is there objection to the request 
of the gentleman from Tennessee?
  There was no objection.
  Mr. GORDON. Mr. Chairman, I yield 2 minutes to the gentlewoman from 
Texas (Ms. Jackson-Lee).
  Ms. JACKSON-LEE of Texas. Mr. Chairman, I thank the distinguished 
gentleman for yielding me this time.
  First of all, I am grateful that the Committee on Science had an 
opportunity to provide insight into this legislation.
  I have an amendment that I will be discussing later on in the day 
that speaks to the purpose of my standing today in general debate, and 
that is to make, I think, the declaration that we clearly need to have 
an energy policy.
  My amendment will engage farmers and ranchers in Texas and all over 
the Nation to give them extra training and resources to assess the 
availability and viability of bioenergy. But it is important that, 
although this legislation may not be all that we want it to be, the 
very fact that there is going to be a review of electricity and 
transmission is important, the very fact that we acknowledge the high 
cost of gasoline, even though I might say to my distinguished friend 
from Tennessee I offered an amendment that might determine why there is 
such an increase in gasoline prices, why the transportation costs are 
so high, and of course that was not allowed.

                              {time}  1600

  But we will have a number of debates dealing with the price of 
gasoline.
  This is not a ``get-you'' time in America. This should not be, We get 
the industry or we get the consumer. This needs to be a time when we 
sit down and reconcile over these very frightening issues.
  I want jobs in my community. I want a thriving energy industry. In 
fact, I had an initiative that would report on the deposits in Texas 
and Louisiana offshore so that we could be more independent of foreign 
oil and do more domestic drilling in a safe and environmentally 
manageable way.
  This bill today will allow us to debate these questions.
  Am I disappointed? In some sense, yes, that global warming is not 
mentioned, that more of the environmental emphasis is not mentioned; 
but if we do not move from point A to point B to point C to have a real 
energy policy, there will be no way, if you will, to ensure for the 
American people a safe and secure America.
  It is a question of energy security. I would ask my colleagues to 
consider this legislation as we move forward.
  Mr. Chairman, I speak today with mixed emotions. While I realize the 
importance of having a comprehensive energy bill, I am concerned that 
the bill does not do enough. Please do not misunderstand me, there are 
good aspects to the bill. For example, the bill provides for much 
needed advances in Energy Efficiency, Renewable Energy, and Nuclear. 
However, there is still much work to be done. To this end, I plan to 
offer an amendment and work with Members, and industry with hopes of 
improving upon some key aspects of the bill.
  Before going any further, I think it is important to touch upon the 
question everyone is asking, ``Why Are Gas Prices So High?'' Whether 
right or wrong, the common answer has been that supply is not able to 
keep up with demand. According to recent studies, overall prices are 
rising because of the razor-thin supply and demand balance in the 
global crude oil market (i.e. the increase demand for oil in China and 
India has played a major role

[[Page 7121]]

in driving up oil prices around the world). In addition, the situation 
in Iraq has not helped. Unfortunately, there seems to be no end in 
sight to this problem.
  According to the Energy Information Administration, EIA prices in 
2005 are projected to remain high, at an expected average of $2.28 per 
gallon for the April to September summer season, 38 cents above last 
summer. Similar high motor gasoline prices are expected through 2006. 
Monthly average prices are projected to peak at about $2.35 per gallon 
in May. Summer diesel fuel prices are expected to average $2.24 per 
gallon. As in 2004, the primary factor behind these price increases is 
crude oil costs.
  In the United States, additional changes in gasoline specifications 
and tight refinery capacity can be expected to increase operating costs 
slightly and limit supply flexibility, adding further pressure on pump 
prices. Despite high prices, demand is expected to continue to rise due 
to the increasing number of drivers and vehicles and increasing per-
capita vehicle miles traveled.
  While these may be the facts, it does not sit well with my 
constituents back in Texas, and for that matter with all Americans. 
Thus, as the bill moves along the legislative process, I will be 
working with Members and industry to establish a sense of the Congress 
that the Secretary of Energy, acting through the Administrator of the 
Energy Information Administration, should commence an immediate 
investigation on the causes of high gasoline prices in the United 
States and, in collaboration with the petroleum industry and the 
Congress, develop a solution to such prices. At the rate we are going, 
the average American will not be able to afford to drive.
  It is important for me to mention that I will also work with Members 
of Congress to encourage the Secretary of the Interior, in consultation 
with other appropriate Federal agencies, every 2 years, to transmit a 
report to the Congress assessing the contents of natural gas and oil 
deposits at existing drilling sites off the coasts of Louisiana and 
Texas. It is important that we do our best to become an energy 
independent Nation. This can only be done through the full utilization 
of energy sources within our Nation's geographic influence. Currently, 
most if not all, of the nations we import oil from are either directly 
or indirectly hostile towards the U.S. Many of these nations provide 
funding to terrorist groups who oppose the U.S. and at any time could 
decide not to sell oil to us. Where would that leave us? It is 
important that we know what we have right hear at home. The 
aforementioned two-year assessment would allow an inventory of existing 
oil and gas supplies and an evaluation of techniques or processes that 
may exist in keeping those wells protected.
  Needless to say, I represent residents and businesses that call the 
18th Congressional District of Texas their home. Energy and energy 
related companies and dozens of other exploration companies are the 
backbone of the Houston economy. For this reason, the 18th 
Congressional District can claim well-established energy producing 
companies and suppliers as well as those engaged in renewable energy 
exploration and development.
  I believe that the effects of rising energy prices have had and will 
continue to have a chilling effect on our Nation's economy. Everything 
we as consumers eat, touch or use in our day-to-day lives have energy 
costs added into the price we pay. Today, our society is in the midst 
of major sociological and technical revolutions, which will forever 
change the way we live and work. We are moving from a predominantly 
industrial economy to an information-centered economy. While or society 
has an increasingly older and longer living population the world has 
become increasingly smaller, integrated and interdependent.
  As with all change, current national and international 
transformations present both dangers and opportunities, which must be 
recognized and seized upon. Thus, the question arises, how do we manage 
these changes to protect the disadvantaged, disenfranchised and 
disavowed while improving their situation and destroying barriers to 
job creation, small business, and new markets?
  One way to address this issue is to ensure that this Nation becomes 
energy independent through the full utilization of energy sources 
within our Nation's geographic influence. Before concluding, let me say 
that as legislators, we must boldly define, address and find solutions 
to future energy problems. We know that the geological supply of fossil 
fuel in not infinite, but finite. We know that our Nation's best 
reserves of fuel sources are in the forms of coal and natural gas, 
among others.
  I would only caution my colleagues, administration officials, 
academics, industry leaders, environmental groups and consumers not to 
assume that we have learned all that is there is to know about energy 
extraction, refining, generation, or transportation but that we are 
still learning. We must bring to this debate a vigor and vitality that 
will enliven our efforts to not have a future of energy have and have 
nots, due to out of control energy demand with few creative minds 
working on the solution to this pressing problem.
  The CHAIRMAN. Pursuant to the rule, the gentleman from California 
(Mr. Pombo) is recognized for 10 minutes.
  Mr. POMBO. Madam Chairman, I yield 2 minutes to the gentleman from 
Nevada (Mr. Gibbons), the subcommittee chairman.
  Mr. GIBBONS. Madam Chairman, I rise in strong support of H.R. 6.
  For too many years, Madam Chairman, our domestic energy policy has 
languished, driving investment overseas and increasing our reliance on 
foreign energy resources. Yet, we continue the cycle of tolerating 
irresponsible energy policies, continuing to discourage investment in 
domestic energy production and, subsequently, becoming more dependent 
on foreign sources of energy.
  Relying on foreign and, sometimes, hostile nations for energy and 
minerals jeopardizes our national security, Madam Chairman. And for the 
safety and security of our homeland, I want the United States to be 
reasonably self-sufficient in meeting the demands of our current energy 
consumption.
  H.R. 6 makes strides in ensuring our domestic security by 
streamlining the permitting process for renewable and traditional 
sources of energy, while protecting the integrity of the environmental 
review process. H.R. 6 also contains provisions to spur production of 
renewable energies such as geothermal so we can reduce our reliance on 
traditional sources.
  Through this important legislation, we will have increased ability to 
utilize the vast renewable energy resources on our public lands in an 
environmentally responsible manner.
  I urge all of my colleagues to support the passage of this 
legislation that will allow us to capitalize on our Nation's energy 
exploration and development technology, commitment to environmental 
quality and conservation, and work ethic to develop our domestic energy 
resources.
  The CHAIRMAN. Pursuant to the rule, the gentleman from West Virginia 
(Mr. Rahall) is recognized for 10 minutes.
  Mr. RAHALL. Madam Chairman, I yield myself such time as I may 
consume.
  I rise in opposition to the pending legislation, surprise, because it 
will do absolutely nothing to lower the price of motor fuel and reduce 
America's dependence on foreign oil.
  This legislation is antitaxpayer, anticonsumer, and 
antienvironmental. It is social security for the oil industry. We have 
before us a bill that squanders what could have been a bold stroke for 
American energy independence. It could have been visionary, and it 
could have been daring in developing new energy technologies and fuel 
sources.
  Instead, we have before us a bill which contains a litany of various 
tax breaks and polluter protections for energy producers who are 
already experiencing record profits at the expense of the American 
public.
  The bill contains $8 billion in tax breaks, largely for well-heeled 
oil and gas conglomerates who are already milking our constituents at 
the pump. In the Resources title alone, CBO says there is nearly a half 
a billion dollars of direct spending to subsidize the oil and gas 
industry over the next 10 years. To put it bluntly, if the taxpayer is 
feeling the pain of an energy crisis, it is coming from the derrick 
sticking out of his back pocket, and this measure does nothing to ease 
it.
  Even President Bush recently stated, ``I will tell you, with $55 oil, 
we don't need incentives to oil and gas companies to explore. There are 
plenty of incentives.'' These are President Bush's own words.
  But has that stopped the Republican majority from bestowing such 
largesse on some of their biggest benefactors? Of course not. Because 
when one pulls the curtain aside on this bill, what we find is a wacky 
old fellow pulling the manipulating levers, reaching deep

[[Page 7122]]

into the Treasury and deep into the pockets of ordinary Americans.
  This bill, as I said, could have been a bold stroke, but it missed 
that mark. It ignores coal, America's most abundant energy resource. It 
pays mere lip service to coal. There is nothing here that would 
actually encourage an electric utility to install or invest in clean 
coal technology. There is nothing here that would advance bona fide 
technologies for coal gasification or liquefaction to run our factories 
and vehicles.
  And, to add insult to injury, the single substantive coal provision 
in this bill favors Western Federal coal, primarily in the Powder River 
Basin of Wyoming, over all other coals. It would give Federal coal from 
that region an artificial, competitive advantage to the detriment of 
coal producers and consumers in other States. Already, this Western 
coal has infiltrated utility markets traditionally served by 
Appalachian and Midwestern producers. To now provide these producers of 
Federal coal with special treatment in the form of relief from 
competitive bidding and the payments of royalties is unseemly and has 
no part in what is supposed to be a national energy policy bill.
  It is, in effect, a direct assault upon all other coal, including 
coal from my home State of West Virginia, and it is a direct assault on 
consumers, jobs, and the economy and the communities which rely on coal 
from States like West Virginia who are not given special treatment 
under this provision.
  Yet, under the rule governing debate on this bill, I was denied the 
ability to offer an amendment to strike this provision, an effort that 
came very close to succeeding when the House last considered this bill. 
Could it be that because I came so close to knocking it out of this 
bill on the House Floor of the last Congress I was denied that 
opportunity this year? Could it be because the Republican leadership 
fears debate on this provision and will only allow amendments that they 
can bet the House will fail to pass? All of this, all of it is why 
every newspaper in my congressional district that has editorialized on 
this bill has editorialized against this bill.
  We are engaging in an exercise of microwave legislating today. The 
Republican leadership has hauled out the remains of last year's freeze-
dried energy bill and are seeking to warm it up for yet another 
taxpayer-financed feast.
  The people of America will not be played for fools. They will not be 
made to believe that all of our energy problems will go away if we 
simply grant misplaced and inappropriate tax cuts to energy fat cats, 
and if we allow polluters to get off the hook and shortchange the 
health and safety protections of our citizens.
  I urge a no vote on the bill.
  Madam Chairman, I reserve the balance of my time.
  Mr. POMBO. Madam Chairman, I yield 1\1/2\ minutes to the gentleman 
from New Mexico (Mr. Pearce), the subcommittee vice chairman.
  Mr. PEARCE. Madam Chairman, I rise today in support of the energy 
bill that we are discussing on the floor.
  Madam Chairman, the absolute truth is that Americans are paying more 
at the pump today than ever before. Home heating costs have escalated 
dramatically. These things are both reflections of the lack of an 
energy policy. All we are suggesting in this energy bill is that we 
need to recognize the dynamic forces that are at play in today's 
economy, and that we need to take steps to correct it.
  For instance, natural gas in this Nation is hovering in the $7 range, 
but if we look over in the Asian areas and in Russia, it is 95 cents 
and 70 cents. What is happening is that we are outsourcing jobs to 
those other nations because they are paying one-tenth the price for 
natural gas that we are paying here, and yet our friends on the other 
side of the aisle some days want to talk about outsourcing jobs and the 
horrific effect that it has on the economy; and today we are doing 
something factual about it, and yet they want to turn an eye and say, 
That is okay, send those jobs; we probably did not need them to start 
with.
  They would have us believe that what we are facing and what we are 
giving is simply a handout to the oil companies, and what we are doing 
is simply trying to develop new sources of oil that is extremely 
expensive to reach. We are drilling on some offshore platforms that 
cost billions of dollars to set in place. We are drilling on those with 
great risk that we will lose money, and what we are simply saying is 
that deep well incentives should be in place.
  Now, the incentives that are in place for onshore production are 
either very difficult areas to drill in or the incentives only kick in 
after the price falls to a certain level.
  Madam Chairman, it is time for us to pass an energy bill. The 
consumers in this Nation depend on it, and they are depending on 
Republicans because our friends on the other side of the aisle refuse 
to help.
  Mr. RAHALL. Madam Chairman, I yield 4 minutes to the distinguished 
gentleman from California (Mr. George Miller), the distinguished former 
chairman of the Committee on Resources.
  Mr. GEORGE MILLER of California. Madam Chairman, I thank the 
gentleman for yielding me this time.
  This bill, first and foremost, should be rejected by this Congress, 
because it is very bad for the consumers, it is a very bad deal for the 
taxpayers, it is lousy for the environment, and it certainly does not 
do much for the American economy.
  This bill is another missed opportunity to take America into the 
future, to take America into the leadership around the world in energy 
production, energy innovation, and energy technology; to create a new 
generation of important products, and a new generation of jobs.
  But what this bill does not understand is that energy sufficiency and 
sustainability is very different from energy oil independence. The 
first is achievable in the national interest and the other is not. Oil 
independence is not achievable in this bill or in any bill you can 
bring to the floor.
  If we were really seeking to strengthen America's hand with respect 
to energy and our economy, we would do all that is possible to develop 
a national sustainable energy policy that would minimize our dependence 
on foreign oil. That is not this bill.
  Rather than placing too much of our emphasis on new oil supplies, we 
would build a national energy policy that is based upon the strength of 
our country, rather than its weaknesses. Those strengths are the 
marketplace, innovation, technology, and capital. If these economic 
forces were truly unleashed to provide a national energy policy, the 
role of coal and oil would be greatly diminished and would still be 
important, but diminished.
  America's energy policy would evolve into one where business 
decisions, capital allocations, research commitments, and environmental 
policy would coincide to make businesses more efficient and productive, 
develop new products and services, would expand and cover the 
environment, would be easier and less expensive and clean.
  Such a policy demands a synergy of most parts of national energy 
policy. To date, these ideas have been treated as a stepchild, as they 
are in this bill. To do so, the Congress would have to stop thinking 
about energy policy as an extension of the past. They would have to 
think about it as going out to embrace the future, with American 
technology, American ingenuity, American talent, American capital, and 
the American marketplace. America should go out and embrace the future, 
rather than dumping billions and billions of dollars into trying to 
bring the past a little bit further forward, to bring the fossil fuels 
a little bit further forward.
  That is the mistake of this bill, that is the tragedy of this bill, 
and that is the missed opportunity. That is the reason why this bill 
does so little for the consumer.
  In fact, it harms the consumer at the pump by increasing the price of 
gasoline. That is why it is such a bad deal for the taxpayer, because 
the taxes are used for old production, for old ideas, not for 
innovation, not for the future,

[[Page 7123]]

and not for a sustainable energy policy. That is why it is so bad for 
the environment, because they use tax policy to drive environmental 
decisions that otherwise would not be made and, of course, that is why 
it is bad for the economy, because it continues our dependence. In 
fact, it drives us deeper into the dependence on the most unstable 
countries in the world, into the hands of those countries that simply 
cannot provide stable environments for the production of those energy 
resources.
  That is why a different policy would be about a sustainable energy 
policy, not trying to achieve oil independence, or foreign oil 
independence as this bill does. It is unfortunate, because what we do 
is we miss the opportunity to bring about what the best and the 
brightest prospects of America have always offered, and that is new 
innovation, new technologies, new discoveries, new capital formation, 
and a new economy. But this bill does not do it.
  This bill resides in the past century. This bill resides with the old 
industries. This bill resides with the old ideas, and it certainly 
resides with the old and tired subsidies that milk the taxpayers, to 
turn around and give them to now the most profitable companies in the 
American economy at this time.
  It is very unfortunate, and it should be rejected.

                              {time}  1615

  Mr. POMBO. Madam Chairman, I yield 1\1/2\ minutes to the gentleman 
from Pennsylvania (Mr. Peterson).
  Mr. PETERSON of Pennsylvania. Madam Chairman, I think I am on a 
different bill than I just heard described here. I applaud the energy 
efficiency and conservation in this bill. I applaud the increasing of 
renewable technologies in this bill. I applaud the hydrogen fuel cell 
program in this bill. I applaud the next-generation nuclear in this 
bill. I applaud the clean coal technology.
  I applaud the incentives for deep gas drilling. That is the one issue 
I do not think we do enough in this bill. I believe we need to do much 
more to increase the supply of natural gas, and I hope in conference we 
can.
  Current natural gas prices are exporting thousands of American jobs, 
the best jobs we have, the chemical plants, fertilizer factories, and 
those who melt steel and ore and use a lot of national gas.
  We as a country have an island to ourselves with natural gas; they 
are not world prices. When everybody pays $50 for oil, we have the 
highest prices for natural gas of all modern countries, and we are 
losing the companies who use large quantities of it.
  Just to compare, we are 40 percent higher on natural gas than Europe. 
We are 50 percent higher than Japan. We are 600 percent higher than 
South America. We are 800 percent higher than Russia. We heat our 
homes, our schools, our hospitals, and our businesses with natural gas.
  It is the bridge to hydrogen. All hydrogen today generally is made 
from natural gas; it is the easiest way to make it. It can assist us in 
transportation, with our buses, taxi cabs, delivery trucks, by using 
natural gas rather than oil. We need, in the final bill, to have a much 
stronger chapter with natural gas; it is the one area that I think we 
need stronger in this bill.
  Mr. RAHALL. Madam Chairman, I yield the remainder of my time to the 
gentleman from Washington (Mr. Inslee), a valued member of our 
Resources Committee.
  Mr. INSLEE. Madam Chairman, the best way that I can characterize this 
bill is that it is a Jurassic Park bill in that it is about dinosaurs, 
of dinosaurs, and in a sense by dinosaurs.
  It depends on the hope that somehow dead dinosaurs will appear 
underneath the continent of the United States where they just do not 
exist. We consume 25 percent of the oil; we have only 3 percent of the 
world's oil reserves. If you drill in Mt. Ranier National Park, the 
Arctic and Yosemite, the oil is not there; the dead dinosaurs decided 
to die somewhere else.
  This is a doomed policy of searching for dead dinosaurs. And it is a 
dinosaur-like philosophy that we should decide to subsidize technology 
being developed in the late 1800s in 2005. We should be giving these 
subsidies to the nascent wind, solar, wave power, energy-efficient cars 
so we can build energy-efficient cars here rather than in Japan.
  You do not give mother's milk to a 65-year-old person; you give it to 
the nascent infant industries that need it. That is not what happened 
to this bill, where 94 percent of the subsidy goes to an industry, the 
most profitable in American history; one company had $8 billion profit 
in the third quarter last year on your $55 a barrel oil.
  That is what is going on in this bill. What we should be doing is 
hearing lessons from our successful past, where we showed where we 
increase the efficiency of our cars; that is an energy future. We need 
the new Apollo energy plan, a visionary high-tech plan, not a dinosaur-
like plan.
  Mr. POMBO. Madam Chairman, I yield 2\1/2\ minutes to the gentlewoman 
from Wyoming (Mrs. Cubin), the full committee vice chairwoman.
  Mrs. CUBIN. Madam Chairman, I rise today in strong support of H.R. 6, 
the Energy Policy Act of 2005.
  Wyoming is often called the energy basket of America, but people in 
my State who are taking out emergency loans just to fill up their 
pickup's tanks would not know it. In my home town of Casper, gas is 
$2.10 a gallon; in Cheyenne it is almost $2.20. It is $2.30 in Riverton 
and $2.40 in Jackson.
  Madam Chairman, that is just too much. Some of the people around the 
country who pay close to $3 a gallon might think Wyoming's prices are a 
bargain. But remember, Wyoming covers almost 100,000 square miles. That 
is a lot of miles on the highway to do business, and a lot of money at 
the gas pump.
  Wyoming cannot support subways or mass transit when we do not have 
masses in the first place. This spike in gas prices has real 
consequences for people in Wyoming whose drives to work are measured 
not by the length of the country and western song on the radio, but by 
the entire country and western album.
  When our country was threatened by terror attacks on 9/11, Congress 
acted. Now Congress is called upon to act again. To keep our economy 
sound in Wyoming, we must pass this energy plan.
  This bill will cut our reliance on foreign energy and put our focus 
where it belongs, on domestic production. Would you rather get the oil 
we need from the Middle East or from midwest Wyoming? I know where I 
stand, and I have a number of bills within this package that address 
domestic energy production.
  It seems I have spent most of my congressional lifetime helping to 
develop this package, so I know a little bit about it. It will 
strengthen America's standing as the Nation with the most strict 
environmental laws on Earth. It will streamline the process to safely 
explore for new energy sources and put us on the road to energy self-
sufficiency.
  The opponents of this bill urge a ``no'' vote because it is not a 
quick fix at the pump. Madam Chairman, since when does a quick fix 
actually fix anything? When does a ``no'' vote without an alternative 
actually fix anything? What America needs and what we have needed for a 
long time, for more than a generation, is a comprehensive energy plan.
  I urge my colleagues to support the plan before us today.
  Mr. POMBO. Madam Chairman, may I inquire as to how much time is 
remaining.
  The CHAIRMAN. The gentleman from California (Mr. Pombo) has 3\1/4\ 
minutes remaining.
  Mr. POMBO. Madam Chairman, I yield the balance of my time to myself.
  I guess here we go again. You know, we have had the opportunity in 
the House four or five times to debate the energy bill. And I look at 
the history of energy policy in this country and the efforts of 
Congress to try to deal with the very real energy demands that we have 
today in this country.
  We are not providing enough energy to meet the demands that we have. 
You

[[Page 7124]]

know, you go back 30 years ago, and the United States was dependent on 
foreign energy about 30 percent. About 30 percent of our oil came from 
foreign sources.
  We did very little to deal with that. There was a pledge made by 
then-President Carter that we were going to become independent. The 
President and succeeding Presidents have talked about becoming 
independent from foreign oil. But we did not adopt the kind of policies 
that we had to to increase the amount of domestic production so that we 
were not so dependent on foreign oil.
  I look at it today and nearly two-thirds of the energy that we 
consume in this country comes from foreign countries. And that is a 
direct result of the failure on the part of Congress to pass a national 
energy policy. We have not addressed that. I look at what we are doing 
wrong in terms of producing additional energy in this country. And I 
think if you listen to the debate from some of my colleagues, you know 
what we are doing wrong. Yeah, you know, we did not have a lot of 
dinosaurs die under Yosemite or Yellowstone, you are right; but we had 
a whole heck a lot of them die in the Arctic plains.
  There is oil and gas in Alaska. It is there. We all know it is there. 
And yet we still have the same people year after year after year coming 
down, whether gas is $20 a barrel or $60 a barrel they are still 
opposed to doing it. We have the same people come down here year after 
year after year that opposed putting a pipeline to move that gas from 
Alaska to the lower 48 States.
  We have the same people who come to the floor year after year and 
oppose every single attempt that is made to increase the amount of 
energy produced in this country. Year after year they oppose it.
  Last year we had an amendment to make it easier to site renewable 
energy on Federal lands. And the same people that are down here today 
opposing this bill opposed that bill on renewable energy. Yeah, you 
know, it all sounds great. You can come down here and talk about how we 
need more renewable energy.
  But when you have a chance to vote for it, you vote no; and you do it 
every single time. You know, we hear this over and over again.
  You know, when the bill moved through the committee, we had 20 or 25 
amendments. Not a single one of those amendments was a partisan vote, a 
party-line vote. Every single one of them we had members of the 
minority and majority that joined together to either pass or defeat the 
amendment. There was so much support for this bill coming out of the 
Resources Committee, it passed on a voice vote.
  Every time that we get this bill up before the House, it passes with 
both majority and minority votes. There is support for doing this. I 
ask my colleagues with $55 a barrel oil, do you not think it is time 
that you did something? If you do not like this bill, where is your 
alternative? Because as of yet all you do is the same old rhetoric.
  The CHAIRMAN. Pursuant to the rule, the gentleman from California 
(Mr. Thomas) and the gentleman from California (Mr. Stark) each will 
control 10 minutes.
  The Chair recognizes the gentleman from California (Mr. Thomas).
  Mr. THOMAS. Madam Chairman, I yield myself such time as I may 
consume.
  Once again the House is debating a ``comprehensive energy package.'' 
I do have to say that as far as the Ways and Means Committee is 
concerned, it is just slightly less comprehensive than it has been in 
the past. But that is because we understand, having gone through a 
conference with the Senate, the kind of package that will maximize our 
chances in producing a fair and balanced tax section.
  In discussing what we do in this particular bill, and I enjoy hearing 
people discuss it as though it is the conference report that is in 
front of us, it is in fact, and I will say it flatly, and in a 
negotiating position, before us to sit down and work with the Senate.
  It does have renewable provisions in the tax package, but by a small 
amount. The majority focus is on the infrastructure of this country, 
the electric power lines, gas collecting lines, and supporting a 
structure which will be the backbone of our energy needs clearly for 
the next quarter of a century before any of the innovative approaches 
begin to carry a significant share of our energy needs.
  I might also caution Members not to get too carried away looking at 
this particular piece of legislation under the heading of an energy 
bill and assume that we have done nothing since the conference report 
that was agreed upon between the House and Senate was passed by the 
House and not the Senate.
  I would ask you to go back and refer to legislation passed just a 
short time ago under the title of the Working Families Tax Relief Act. 
In that bill we had incentives for wind, open biomass, electric cars, 
and alternative-fuel vehicles.
  In the American Jobs Creation Act, we provided incentives for 
ethanol, biodiesel, geothermal, solar, open biomass, municipal solid 
mass, and refined coal.
  I know the other side is going to offer that constant lament, what 
have you done for me lately? The answer is, let us get to conference, 
put together a package, once again come to the floor of the House with 
a conference agreement, we will pass that conference agreement, and the 
Senate will pass that conference agreement. And I will conclude my 
opening remarks by saying, I was very pleased that on the Ways and 
Means Committee, five Democrats understood, one, the strategy that we 
are undertaking, and, two, supported the content of that strategy by 
voting for the Ways and Means position.
  I know a number of people have a definition of bipartisan, but based 
upon the recent history of the Ways and Means Committee, five Democrats 
supporting a measure offered in that committee is unprecedented 
bipartisan support. And I was very pleased for it.
  Madam Chairman, I retain the balance of my time.
  Mr. STARK. Madam Chairman, I yield myself such time as I may consume.
  Madam Chairman, I rise in opposition to this bill. First of all, it 
is improperly titled. It is not an energy policy act at all; it is the 
delay bill. Now, why is it the delay bill?
  Well, it is a bill that delays energy self-sufficiency by enacting 
tax breaks and policies that benefit the oil and gas industry and 
ignores renewable alternatives.
  It delays protecting the Arctic National Wildlife Refuge. It delays 
holding the makers of MTBE accountable for destroying drinking water. 
It delays the end of $8 billion in special interest tax breaks. It 
delays fishery restoration by giving dam owners free rein.

                              {time}  1630

  It delays protecting our children who suffer more and more from 
asthma as this bill delays enactment of stricter smog regulations. It 
delays protecting our shorelines from oil and gas development. It 
delays cleaner air and lower gas prices by mandating an agricultural 
welfare program called ethanol. It delays the end of corporate welfare 
for the likes of Enron and Home Depot. It delays the ability of States 
to enact tougher energy efficiency laws.
  I could keep going, Madam Chairman, but I do not want to delay the 
proceedings any further.
  The bill was written by and for the oil and gas industry with the 
involvement of a small band of powerful Members of Congress. Its very 
existence raises questions of ethical behavior. But as we know, our 
Committee on Standards of Official Conduct is unable to meet to 
consider such transgressions because of delay by my colleagues on the 
Republican side of the aisle which delay Committee on Standards of 
Official Conduct action against one of their own.
  The purpose is not to enact a sane energy policy for our country at 
all. In fact, as I have outlined above, it delays that very 
possibility. It is an antienvironment, anticonsumer, antienergy self-
sufficiency and irresponsible corporate welfare bill.

[[Page 7125]]

  Rather than considering this legislation, we should be considering 
why ``delay'' continues to rule the House of Representatives.
  Madam Chairman, I reserve the balance of my time.
  Mr. THOMAS. Madam Chairman, I yield 2 minutes to the gentlewoman from 
Pennsylvania (Ms. Hart), a member of the committee.
  Ms. HART. Madam Chairman, I thank the chairman and my colleagues on 
the committee for moving forward such an excellent package as part of 
the energy bill.
  I think many of us have spent the last several years hoping that we 
would get an energy bill passed. There are a number of reasons why; in 
my district, clearly one of the most important is simply the cost of 
energy, whether it is home heat, whether it is the cost to 
manufacturers which is costing us jobs. We need to move forward with 
this energy bill.
  My district is home to a number of manufacturers. I have met with 
many of them since the beginning of the year when we were hoping that 
we would get the energy bill moving. What they have asked for us is to 
help them with their higher overhead, ultimately helping them with 
their competitiveness, helping jobs to remain in our district. 
Obviously, these companies' employees are much more susceptible to 
layoffs without the energy bill.
  I am also hearing from home owners, many of the elderly in my 
district with older homes, who need some help, some incentives to 
improve their homes, some tax assistance so they will have more energy-
efficient homes, to those who are building new homes, more incentives.
  The bill also addresses our aging electric transmission system. Many 
of our transmission system lines were built 30 to 50 years ago, and it 
is estimated by 2015 electricity consumption will increase by 28 
percent. We need to repair and rebuild the 160,000 miles of electrical 
transmission lines. This bill will reduce the time for depreciation 
recovery and improve the opportunity for those companies to update 
those lines, helping in efficiency, helping in opportunity to have 
cheaper energy.
  It is important also that we encourage new kinds of fuel. Especially 
important are fuel cells and, in fact, providing new jobs and better 
technology. Fuel cell technology in the United States is growing. The 
use of it is growing and, in fact, jobs in that field are growing. I 
think it is important that this bill provide a 15 percent tax credit 
for business installation of fuel cell power plants and residential 
fuel cell investments.
  This is a great technology. It is one that has been utilized in other 
parts of the world to a further extent than it has been utilized in the 
United States. The help in this bill will encourage further use of fuel 
cells.
  This bill makes changes of the Tax Code that will speed the 
development of newer and cleaner production of energy. It will help 
curb energy costs. It will help move our economy forward.
  I urge my colleagues to support this bill, and I especially commend 
my colleagues on the Committee on Ways and Means for the tax 
provisions.
  Mr. STARK. Madam Chairman, I yield 3\1/2\ minutes to the gentleman 
from Washington (Mr. McDermott) without further delay.
  Mr. McDERMOTT. Madam Chairman, Friday is Earth Day, but that will not 
stop the Republicans from passing legislation that will make the Earth 
dirtier, more polluted and warmer.
  The Republican legislation favors corporate America over Main Street 
in America. It will neither ask nor answer any of the energy issues 
that threaten our environment, our economy and future generations. 
Instead, the Republicans will answer the greatest challenge of our time 
by telling Americans to dig deeper into their pockets for big oil.
  At a time when America needs energy vision, Republicans have provided 
us with their corporate donor lists. Despite soaring prices, despite 
dangers to our economy and security for our dependence on oil, the 
administration puts forward the deal of the century for big oil, gas 
and coal. It rewards its friends and encourages America's addiction to 
oil.
  Nothing in this bill will lower gasoline prices a single penny. 
Nothing in this bill will alter our dependence on oil. Nothing in this 
bill will address the needs and concerns of the American people facing 
economic peril at the pump every morning when they put $50 worth of gas 
into their car. Instead, Americans from Maine to California will pay at 
the pump and pay through the nose. Big oil's profits today defy 
description.
  The CEO of ExxonMobil who does not think global warming is real was 
paid $38 million last year. The price of crude oil jumped $2 a barrel 
yesterday. That added $1 billion of earnings to Mobil's earnings. Maybe 
that explains why oil and gas companies have reduced their investment 
in facilities by 20 percent even as their profits have increased 400 
percent.
  The oil and gas industry is sitting atop a mountain of cash looking 
down on Americans who are held hostage by runaway gas prices that grow 
the mountain of oil prices even higher. And we are giving them $7 
billion more today. They do not need it. Across the country gasoline 
prices are 20 percent higher than they were a year ago. Neither wages 
nor economic opportunities come close to bridging that kind of deficit 
for the American family.
  The only choice for more Americans is to pay more, save less, use 
consumer debt. Oh, yeah, remember the bankruptcy bill? And give up 
something to make the frayed ends meet, while ExxonMobil's CEO pockets 
$38 million.
  With the price of crude oil sky high, you would think we would be 
declaring a 12-alarm economic fire that endangers the lives of every 
American family and the economic health of our economy.
  Let me quote something that sums this up. ``We are grossly wasting 
our energy resources and other precious raw materials as though their 
supply was infinite.'' President Jimmy Carter spoke those words in 
1976, almost 30 years ago. We laughed at him when he put on a sweater 
and said maybe we should turn the thermostat down 1 degree.
  Yet today Americans propose a policy that seeks to roll backward from 
the ominous warnings of the mid-1970s. America needs vision and 
leadership, but the Republicans will pass a bill that endorses and 
rewards the traditional forms of energy. It proposes cutting billions 
in promising renewable energy provisions. It proposes waiving liability 
for companies that pollute our groundwater. It subsidizes oil, gas and 
coal. It fails to address meaningful automobile conservation. And worst 
of all, we are going to go up to the Alaska Wildlife Refuge and we are 
going to drill.
  We are going to drill our way to oblivion if we follow this pattern.
  Mr. THOMAS. Madam Chairman, I yield myself 10 seconds.
  I anxiously look forward to the debate on the Democrat substitute and 
would willingly yield time to the gentleman from Washington (Mr. 
McDermott) to make all the points he just made on the majority bill on 
the minority bill since they include in their entirety the tax section 
of the majority's bill.
  Madam Chairman, I yield 1\1/2\ minutes to the gentleman from Arizona 
(Mr. Hayworth).
  Mr. HAYWORTH. Madam Chairman, earlier this year I reintroduced the 
Residential Solar Energy Tax Credit Act, which would provide a 15 
percent tax credit for the purchase of solar water heating systems and 
photovoltaic systems to be installed in residential settings.
  The maximum amount of this credit is $2,000 and the credit cannot 
apply to solar energy systems used to heat swimming pools. I am pleased 
this provision has been included in the tax title to H.R. 6, the Energy 
Policy Act of 2005.
  The solar energy industry in our Nation has been growing at a clip of 
25 percent per year for the past several years, yet U.S. manufacturers 
export 75 percent of their products because of the higher up-front 
costs of solar energy systems as compared to other energy sources.
  Purchasing a solar energy system is like buying a car and prepaying 
for all

[[Page 7126]]

the gas it would ever need. This makes consumers understandably 
hesitant despite the environmental and other gains associated with 
solar energy. National polls consistently find that over 85 percent of 
Americans want greater support for solar power, and solar power can 
play a role in our energy mix from coast to coast.
  It is my belief that the residential solar tax credit will help 
advance this important form of renewable energy. And in stark contrast 
to the protestations of my friends on the left, we are willing to 
embrace these technologies. It is proven by this solar energy tax 
credit. I thank the chairman for its inclusion.
  I urge support of the legislation.
  Mr. STARK. Madam Chairman, I yield 2\1/2\ minutes to the gentleman 
from Texas (Mr. Doggett).
  Mr. DOGGETT. Madam Chairman, some folks will get a lot of mileage out 
of this bill, but it will not be the hard-working Americans who have to 
pay more and more at the gas pump as a direct result of the policies of 
this Bush administration.
  When the same collection of fossil fuel dinosaurs and tax loophole 
lobbyists come here and order Congress to ``fill 'er up,'' with special 
favors, they seldom go away on ``empty.''
  National security demands a balanced energy policy that encourages 
more new energy technology and renewable alternatives. But in this 
bill, security is sacrificed at the altar of whichever lobbyist had the 
biggest limousine.
  Our families' health depends on clean air and water, but this 
collection of tax breaks, loopholes, handouts and waivers ensures only 
continued healthy profits for some of the worst polluters in the world. 
And this bill is not just about more smoke in the air, it is about more 
smoke and mirrors.
  Take, for example, the synthetic fuel provision that I tried 
unsuccessfully to strike in the Committee on Ways and Means; it is 
really about tax dodging through synthetic accounting. Unscrupulous 
companies get what some estimate to be up to $4 billion a year by 
spraying starch on coal or pine tar on coal. This does not add to the 
energy capability of the coal. It does not cause the coal to burn in a 
less polluting manner. Its sole purpose is to generate significant tax 
dodging. That is why Enron was about to embark on this gimmick that so 
many companies have abused, and which this Committee on Ways and Means 
refuses to end.
  This energy bill is not just about over-reliance on fossil fuels. It 
is about fossilized ideals. It is about a lost opportunity for America 
to be the world's leader in energy technology.
  With our security at stake, when so much of the world's oil is 
located in areas as inflammable above ground as the fuel they hold 
underground, with our families' health dependent on not letting the 
quality of our air and our water deteriorate even further than it has 
under this Administration, this energy bill is the latest example of 
spending today, while the future will be billed in dollars, safety and 
health.
  That bill will be due and paid by our children and our grandchildren, 
like my new little Ella.
  Mr. THOMAS. Madam Chairman, I yield myself 15 seconds.
  I also look forward to seeking to yield to my friend from Texas (Mr. 
Doggett) during the debate on the minority substitute bill, because the 
provision he just viciously attacked on the floor as being totally 
unacceptable is in the Democrats' bill as well. I look forward to 
having those words spoken against their own substitute because it 
contains exactly the same language.
  Madam Chairman, I yield 1\1/2\ minutes to the gentleman from Illinois 
(Mr. Weller).
  Mr. WELLER. Madam Chairman, I rise in strong support of H.R. 6, 
balanced legislation designed to reduce our dependence on imported 
energy, a balanced approach that has earned bipartisan support in the 
House Committee on Ways and Means, emphasizes conservation, alternative 
sources of energy, as well as finding more domestic sources of energy.

                              {time}  1645

  I take my brief amount of time to focus on what I consider to be the 
most consumer-oriented provision of this legislation, legislation that 
rewards conservation, conservation at home.
  Twenty percent of all the energy we consume in America, one-fifth of 
our energy consumed, is consumed at home. In fact, the average American 
spends about $1,500 a year in heating and cooling their home. Just 
think if they could save 10, 20, 30 percent. It means not only energy 
conservation to save energy but it would help their pocketbooks as 
well.
  This legislation today contains provisions out of H.R. 1212, 
legislation that provides up to a $2,000 tax credit that homeowners can 
use in their existing home to make it more energy efficient, put in 
better windows, better doors, better insulation, do a better job of 
sealing the home. If they meet the Federal standard by reducing their 
energy consumption by 30 percent, they can reduce their taxes with up 
to a $2,000 tax credit, 20 percent of the first $10,000 they invest.
  Bottom line is we need to encourage energy conservation. What better 
place to start than right at home. I urge bipartisan support for this 
legislation.
  Mr. STARK. Madam Chairman, I yield 1 minute to the gentleman from 
Georgia (Mr. Lewis).
  Mr. LEWIS of Georgia. Madam Chairman, I thank the gentleman from 
California (Mr. Stark) for yielding me time.
  Madam Chairman, gas prices are going up every single day, and this 
bill does nothing to bring down the costs at the pump. In fact, it 
might just make the problem worse.
  The energy czars must be the majority leader and company, and they 
wrote this bill behind closed doors. This bill is immoral. It is a 
shame and it is a disgrace. This bill was conceived in darkness and 
born in a den of iniquity.
  This bill does not do one thing to bring down the price of gasoline 
at the pump. We can do better. We can do much better. We should vote 
against this bill.
  Mr. THOMAS. Madam Chairman, how much time is left?
  The CHAIRMAN. The gentleman from California (Mr. Thomas) has 1\3/4\ 
minutes remaining.
  Mr. THOMAS. And the other side?
  The CHAIRMAN. The gentleman from California (Mr. Stark) has 1 minute 
remaining.
  Mr. THOMAS. And who has the right to close?
  The CHAIRMAN. The gentleman from California (Mr. Thomas) has the 
right to close.
  Mr. THOMAS. We have one speaker remaining.
  Mr. STARK. Madam Chairman, I am happy to yield 1 minute to the 
gentlewoman from California (Ms. Pelosi), the distinguished minority 
leader.
  Ms. PELOSI. Madam Chairman, I thank the distinguished gentleman from 
California (Mr. Stark) who I am very proud of for yielding me time and 
for his leadership.
  I want to commend four of our ranking members, the gentleman from 
Michigan (Mr. Dingell) of the Committee on Energy and Commerce, the 
gentleman from West Virginia (Mr. Rahall) of the Committee on 
Resources, the gentleman from New York (Mr. Rangel) of the Committee on 
Ways and Means, and the gentleman from Tennessee (Mr. Gordon) of the 
Committee on Science for their exceptional leadership in presenting an 
alternative view to the Republican bill that is on the floor today. 
Unfortunately, we will not have a Democratic substitute, contrary to 
what the gentleman said.
  Madam Chairman, the American people deserve an energy policy that is 
worthy of the 21st century, not one mired in the policies of the past, 
but a bill that looks forward, not backward. It is imperative that our 
country have an energy policy for the future, and it is a matter of 
national security that we reduce our dependence on foreign oil so that 
we will be able to take care of our own security and not have to send 
our troops in harm's way for oil.
  It is critical to our environment that we invest in emerging 
technologies and renewable energy and invest in energy efficiency and 
conservation. It is vital for our economy that our country's

[[Page 7127]]

economic growth is not constrained by the price of oil and that our 
consumers do not have to pay such a serious price at the pump for 
gasoline.
  The opportunity is here, really, for an energy bill that would put 
our country on the right path. But this bill that the Republicans have 
put forth today misses that opportunity. Instead of a positive plan for 
moving our country forward, the Republican bill is warmed-over stew of 
old provisions and outdated policies.
  The Republican bill is anti-consumer, anti-taxpayer, anti-
environment, and with its MTBE provisions, it is harmful to children 
and other living things.
  The Republican bill was conceived in secrecy. It was written with the 
influence of the energy lobbyists, and it shows. It should be rejected 
by this Congress.
  First, this bill is anti-consumer. Gas prices are soaring, and this 
bill makes matters worse. The price of gasoline is approaching $3 in 
some parts of our State; and nationwide, gas prices are up 42 cents 
above a year ago. When it costs nearly $50 for an American worker to 
fill his tank, it is time for relief. Yet it is the fifth year of the 
Bush administration, and there has been no meaningful action to lower 
gas prices at the pump.
  Madam Chairman, according to the Bush administration's own Department 
of Energy, this Republican bill will actually increase gas prices by 
three cents a gallon and will have almost no effect on production, 
consumption, or prices.
  The consumer is not served well when the public interest is not 
served, and the public interest is not served by this bill. Indeed, it 
is a gift to the special interest.
  This bill is wrong because by its electricity provisions it fails to 
protect the public from Enron-style fraud and abuse. By arbitrary caps 
on private spending to improve the reliability of our Nation's 
electricity grid, the bill goes wrong. It is also wrong by repealing 
the Public Utility Holding Company Act, which protects consumers and 
investors from corporate abuses.
  Second, the bill is anti-taxpayer, and I know that the gentleman from 
California (Mr. Stark) and some of the members of the Committee on Ways 
and Means addressed some of these concerns. The bill is loaded with tax 
breaks and royalty relief for oil and gas companies. Of $8.1 billion in 
tax incentives in the bill, $7.5 billion, a staggering 93 percent, is 
for traditional energy sources such as oil, natural gas, nuclear power, 
and electricity transmission.
  Even President Bush has said that when the price of oil is over $50 a 
barrel that the oil industry does not need relief; and yet the 
President wants this bill to come to his desk from Congress as soon as 
possible.
  Democrats have better ideas. I particularly want to commend the 
gentleman from New York (Mr. Bishop) and the gentleman from 
Massachusetts (Mr. Markey) for their amendment to lower gas prices, 
promote energy efficiency, advance emerging technologies for energy 
efficiency and conservation and to improve consumer protection.
  This bill is anti-environment, as the gentleman from West Virginia 
(Mr. Rahall) pointed out. It will open the Arctic National Wildlife 
Refuge to oil and gas drilling, all for the sake of a 6-month supply of 
oil that will not even be available for 10 years. If this unspoiled 
place is not special enough to save for our grandchildren, what is? 
Once they despoil the ANWR, nothing else is sacred.
  Indeed, this bill makes it easier for oil drilling in protected areas 
off our magnificent coastlines.
  The bill contains other anti-environmental provisions, including 
weakening the Clean Air Act, weakening the Clean Water Act, weakening 
the Safe Drinking Water Act and the National Environmental Policy Act.
  Finally, this bill is harmful to children and all living things. The 
provision on the gasoline additive MTBE, a few drops of which can 
poison entire drinking water systems, the provisions in this bill for 
MTBE are a breathtaking example of pandering to special interests. 
Instead of eliminating MTBE now, remember I said a few drops can poison 
entire drinking water systems, instead of eliminating it now, the bill 
gives the MTBE industry 9 years for a phase-out, and it would give MTBE 
producers liability protection in contamination lawsuits.
  Okay. You are poisoning the water supply, you do not have to stop for 
9 years, you have no liability for contamination, and on top of that, 
we are going to give you $2 billion in subsidies, $2 billion in 
subsidies to help MTBE manufacturers.
  The dirty little secret is that the MTBE industry knew all along that 
it would leak out of gasoline storage tanks and contaminate 
groundwater, but they lobbied for it to be added to our gasoline 
anyway. Now they do not want to pay for the cleanup. They want 
taxpayers to pick up the tab.
  The provision on MTBE included in this bill, at the majority leader's 
insistence, killed the bill in the last Congress, and the gentleman 
from Texas (Mr. DeLay), the majority leader, is insisting on including 
it again this year. In fact, this is the majority leader's bill that we 
are debating today.
  Madam Chairman, it is time for us to look forward. It is time for an 
energy policy worthy of the 21st century.
  This Republican energy bill is clearly designed to help energy 
companies make more money, not to help Americans consumers save money.
  I urge my colleagues to stand up for a forward-looking energy bill to 
ensure our national security, to grow our economy, to protect our 
environment, and to keep our water and air safe for our children.
  I urge my colleagues to vote ``yes'' on the Democratic amendments for 
an energy policy for the future, and I urge my colleagues to ``just say 
no'' to the gentleman from Texas' (Mr. DeLay) disgraceful MTBE giveaway 
and his outdated boondoggle of an energy bill.
  Mr. THOMAS. Madam Chairman, I would inquire of the Chair, the 1 
minute that was on the minority side, does that expire?
  The CHAIRMAN. The Chair has followed the tradition of the House to 
allow additional time to the minority leader, and her 1 minute expired.
  Mr. THOMAS. Madam Chairman, I appreciate that, and I yield myself 15 
seconds.
  If we could get the mileage out of the gallon of gasoline that they 
get out of 1 minute, we would not need an energy policy in this 
country.
  First of all, I want to thank the five Democrats on the Committee on 
Ways and Means who had the courage to vote for this excellent tax 
provision. Understanding the pressure they are under, based upon the 
comments that were just made, truly it was a heroic vote.
  Madam Chairman, it is now my pleasure to yield the remainder of the 
time to the gentleman from Pennsylvania (Mr. English).
  Mr. ENGLISH of Pennsylvania. Madam Chairman, at a time of record-high 
energy prices, the growth of the economy is at risk, and it is critical 
that Congress take the necessary steps to put in place a comprehensive 
energy policy.
  The bill before us, frankly, is more limited in scope than I would 
prefer. It is not as ambitious as I would like in creating market 
incentives to overhaul the energy side of our economy; but, 
nevertheless, support of this bill is a critical first step for 
Congress to move forward to meet the critical goal of an effective 
national energy policy.
  Its passage will set us on the right path by encouraging the creation 
of new technologies, by promoting renewable energy sources, by 
modernizing and expanding our energy infrastructure, including our 
power energy infrastructure, and encouraging conservation.
  I believe we need to move forward on this bill. It is long overdue 
and has been a priority of Congress since this President came into 
office. The time has come for us to pass an energy bill.
  Unfortunately, we have seen the vacancy of the debate today, the fact 
that we are not seeing an alternative being offered by the other side. 
We have heard about new ideas from them, but all we have been offered 
is warmed-over rhetoric, and there is no technology available to us 
that could ever make good use of that.

[[Page 7128]]

  Please pass this legislation. It is long overdue. The time has come 
for us to put in place a national energy policy.
  Mr. BLUNT. Madam Chairman, when George W. Bush was running for 
president six years ago, he said that our country had been without a 
comprehensive energy policy for a decade. We are now going on sixteen 
years with no energy plan for America, and it is not for lack of 
trying.
  The House of Representatives has passed Energy legislation four 
times, only to have the bills die in the Senate because of partisan 
politicking. Keeping the lights on should not be a partisan issue. 
Filling up a gas tank should not be a partisan issue.
  Madam Chairman, gas prices are at an all-time high. I want to thank 
Chairman Joe Barton for working with me to include a provision in this 
bill to curb the production of boutique fuel blends and address this 
issue head-on.
  The current gasoline supply includes specially formulated, boutique 
fuels which are required by law in certain communities.
  When supplies are limited, gas prices rise quickly--sometimes 
overnight.
  For example: Missourians can fill their gas tanks up in Springfield 
and drive 3 hours to St. Louis. When they get there, they'll be filling 
their tanks up with a completely different type of gasoline. But if St. 
Louis ever runs short on their boutique fuel, gas stations there can't 
sell what consumers could buy back in Springfield.
  The energy bill we will vote on tomorrow caps the number of these 
special fuel blends and allows communities faced with a shortage due to 
unforeseen circumstances, such as a refinery fire, a waiver to use 
conventional gasoline. This plan relies on simple economics: if we 
create a larger market for a greater amount of gasoline, we'll help 
drive prices down.
  By including this proposal in the energy bill, the House is moving 
the country one step closer to lowering the sky-high price of gas for 
consumers.
  Madam Chairman, it's time to see some common sense at the gas pump. I 
urge my colleagues to support this rule, support the underlying bill, 
and vote for lower gas prices and increased energy independence for 
America.
  Mr. LEVIN. Madam Chairman, if ever there was a time when this country 
needed a smart, forward-looking energy strategy, this is it. Energy 
prices throughout the country are close to record highs. Consumers in 
my State are struggling with soaring gasoline costs. The price of 
gasoline in Michigan today is 36 cents a gallon higher than it was just 
1 year ago. Steep increases in the price of natural gas have resulted 
in skyrocketing increases in consumers' home heating bills over the 
past few winters.
  So what is the response of the House of Representatives? The 
Leadership of the House has brought a bill to the Floor that will do 
little or nothing to reign in energy prices. This is virtually the same 
bill that the Senate rejected 2 years ago. According to the Bush 
administration's own Energy Information Administration, the policies 
contained in this legislation will have a negligible effect on energy 
production, consumption, imports and prices.
  Instead of bringing us a comprehensive energy bill that brings down 
gas prices and encourages greater U.S. energy independence, the bill 
before the House is little more than a grab-bag of special interest 
giveaways. For example, the tax title of this legislation contains just 
over $8 billion worth of tax incentives. Only about 6 percent of these 
go to energy efficiency, renewable energy or conservation. Nearly all 
of the $8 billion goes to the oil, gas and nuclear industries, as well 
as electric utilities.
  With oil and gas prices--to say nothing of energy industry profits--
near record levels, why are we extending these additional subsidies? 
Just the other day, President Bush said that ``with $55 oil we don't 
need incentives to oil and gas companies to explore. There are plenty 
of incentives.'' Yet this bill is chock-full of these unneeded 
incentives. There's $3.3 billion in oil and gas production tax 
incentives, plus a number of ``royalty holiday'' provisions for energy 
extraction on public lands. It's easy to see how this legislation is 
good for the bottom lines of oil and gas companies, but it's consumers 
that need our help today.
  I know that the proponents of this legislation have been saying that 
opening up the Arctic Wildlife Refuge to oil drilling will help bring 
down gas prices. This simply is not the case. We have no idea how much 
oil lies beneath the Refuge. The New York Times reported in February 
that the ``major oil companies are largely uninterested in drilling in 
the refuge, skeptical about the potential there.
  ``Even the plan's most optimistic backers agree that any oil from the 
refuge would meet only a tiny fraction of America's needs.''
  The crusade to drill in the Refuge is a distraction. Even if there is 
extractable oil there, it would take nearly a decade to bring the 
energy to market.
  This country badly needs a balanced energy policy. We can't drill our 
way to energy security. We need a balance between energy production, on 
the one hand, and greater use of renewable sources of energy and 
conservation on the other. The bill before the House today doesn't even 
pretend to seek balance, and I urge my colleagues to reject it.
  Mr. FILNER. Madam Chairman, this legislation takes our nation in the 
wrong direction and fails to meet our energy needs. This is a missed 
opportunity. We could have boosted our nation's commitment to renewable 
and efficient energy, thereby curbing our reliance on foreign oil, 
creating 21st century jobs, protecting the environment and providing 
affordable and reliable energy for America's families. We could have 
taken on the oil companies that are gouging all our constituents at the 
gas pumps. We could have fought for more hybrid vehicles, higher fuel 
economy standards and other 21st century technologies.
  But, instead, the Republican energy bill doles out favors to the oil, 
gas and coal companies, keeping our nation stuck in the 20th century. 
This bill allows the oil companies to rip up the Arctic National 
Wildlife Refuge. This bill protects companies that have polluted our 
water with MTBE. We now know that GOP means gas, oil and petroleum!
  The Rules Committee blocked two amendments I would have offered to 
this bill. The first would have simply extended the tax credit for 
geothermal energy, giving energy companies the time they need to build 
geothermal facilities and actually use the incentive this Congress 
already approved. My amendment would have promoted the development of 
geothermal energy in Imperial Valley, California, and around the 
nation, creating good jobs and a source of clean, domestically-
produced, environmentally friendly, reliable energy. Yet the 
Republicans on the Rules Committee shot down this common sense 
amendment, preventing us from even taking a vote on it.
  They also blocked my amendment to address another very serious issue 
we are facing in Imperial Valley--air pollution from power plants 
across the border in Mexico. In the 21st century, U.S. companies should 
not be able to skirt their environmental obligations by moving a few 
miles across the border! My amendment would have simply required power 
plants in the border region to meet our environmental standards if they 
wish to transmit electricity into the United States. In exchange for 
transmission permits from the Department of Energy, power plants in 
Mexicali, Mexico would have been forced to pay for projects in Imperial 
Valley to off-set the air pollution they are sending across the border 
into our communities. With the highest child asthma rate in California, 
Imperial County certainly needs the help, but the Republicans on the 
Rules Committee once again turned their backs on us.
  We will continue fighting for a better approach to energy in this 
Nation. We will fight for an investigation of the oil companies to 
determine if any wrongdoing has contributed to the sky-high gas prices. 
We will fight for a commitment to geothermal energy and other clean and 
renewable energy sources. And we will continue fighting for an energy 
policy that reduces pollution in the border region and around the 
country.
  Mr. GREEN of Wisconsin. Madam Chairman, I want to express my deep 
disappointment that the Rules Committee did not accept a bipartisan 
amendment authored by Mr. Stupak, myself, and other Great Lakes area 
members last night. This important amendment would have permanently 
banned oil and gas drilling in and under the Great Lakes. The current 
ban is set to expire in 2007.
  I am proud to say that I have long been a proponent of banning oil 
and gas drilling on the Great Lakes and have voted to do so at every 
possible opportunity. The Great Lakes are home to the world's largest 
supply of fresh water. In fact, the Great Lakes make up 95 percent of 
the United States' fresh surface water.
  For those of us in the Great Lakes states, the Great Lakes represent 
a critical component of our environment, our economy and our identity. 
The risks drilling poses to the lakes are unacceptable.
  Congress has a history in support of banning drilling on the Great 
Lakes. A ban was first approved in 2002 and has been extended twice 
since. However, the time has come to end the uncertainty surrounding 
drilling on the Great Lakes. A permanent ban should be put into place.
  While I am disappointed the Rules Committee has prevented the House 
from including a ban on drilling on the Great Lakes, I plan to work 
night and day with my colleagues to get

[[Page 7129]]

a permanent ban approved--either in conference or as a stand-alone 
piece of legislation. This is a fight I will not give up.
  Mr. DeFAZIO. Madam Chairman, over the past couple of years I have 
corresponded with the Department of Energy on an issue of particular 
concern to me. The Department of Energy continues to spend millions of 
dollars, over $60 million so far, to defend private contractors who 
caused injury to citizens downwind of the Hanford nuclear reservation 
despite provisions of the Price Anderson Act to the contrary. The 
American taxpayers should no longer have to bear the burden of 
defending private contractors who have harmed citizens. I would like to 
submit my most recent letter to the Department of Energy and asked that 
it be made part of the Record.

                                                    March 4, 2005.
     Hon. Samuel Bodman,
     U.S. Department of Energy,
     Washington DC.
       Dear Mr. Secretary: Thank you for your September 2003 
     response to my questions about the Hanford Nuclear 
     Reservation case. However, I have ongoing concerns about the 
     Department of Energy's (DOE) willingness to represent DuPont 
     and General Electric at a cost of millions of taxpayer 
     dollars. I believe that the Department's financial support is 
     not only ill conceived, but that it violates the intent of 
     Congress in passing the Price Anderson Act (PAA).
       Regarding question numbered ``2'' of the 2003 letter, we 
     have been informed that while the district judge accepted the 
     defendants' standard of proof for injuries, that decision was 
     soundly reversed by the Ninth Circuit on the merits.
       I am concerned that DOE continues to fund, at considerable 
     taxpayer expense, an ongoing series of technical motions by 
     the contractors.
       It was the intent of the Congress of the United States when 
     it enacted the Price Anderson Act, to encourage the 
     development of nuclear energy and at the same time to provide 
     ``full compensation to the victims of nuclear incidents,'' 
     including the people who were exposed to radiation from 
     nuclear facilities such as Hanford. The actions of the 
     Department of Energy in spending large sums of taxpayer 
     dollars to forestall compensation to citizens who were 
     exposed to radiation releases from Hanford, represents action 
     by a federal agency that is directly contrary to the intent 
     of Congress.
       I recently learned that federal Judge Nielsen, on March 30, 
     2004, rejected the motion of DuPont and General Electric that 
     they be dismissed from the case because they contracted with 
     the government to run Hanford. In underwriting such a motion 
     with taxpayer funds the Department violated the intent of 
     Congress in passing the Price Anderson Act. The fact that the 
     PAA reimburses the companies when people are injured from a 
     nuclear incident precluded the necessity for a ``contractor 
     immunity'' defense as Judge Neilsen held. I have now learned 
     that you intend to financially support an appeal of that 
     Order. Any further attempts to evade the intent of the PAA by 
     the DOE we believe to be a serious concern for the Congress.
       Your letter notes that the DOE does not ``disagree with the 
     proposition that low doses of radiation can cause some forms 
     of cancer.'' In addition, there are government studies that 
     show exposure to radiation contributed to the onset of the 
     claimants' illnesses. Yet the DOE continues to defend the 
     contractors. It would appear that contrary to the fact that 
     workers can be compensated for thyroid cancer, non workers 
     who were exposed to more Iodine 131 than many workers would 
     be denied similar treatment. I do not understand this logic. 
     What policy consideration drives this inconsistent behavior?
       I also learned that the motions of DuPont and General 
     Electric to have all cases dismissed as being filed too late 
     based upon the Statute of Limitations has been dismissed. 
     More than $60 million of taxpayer funds have been spent by 
     DuPont and General Electric for 15 years of loosing motions 
     and adverse rulings. Again, I do not understand why the 
     Department of Energy continues to spend millions of dollars 
     paying lawyers to attempt to defeat claims that the Congress 
     of the United States determined should be compensated.
       I further note that the Hanford plaintiffs were just 
     successful in filing a motion declaring that the operations 
     at Hanford were an ``ultra hazardous activity.'' This holding 
     is consistent with Congress' findings regarding the 
     operations of nuclear facilities. We note again that the 
     Department of Energy spent thousands upon thousands of 
     dollars defending this untenable defense (Energy Employees 
     Occupational Illness Compensation Act of 2000, 42 U.S.C. 
     Sec. 7384 et seq).
       I understand that a trial date has been set, and that 
     General Electric and DuPont are taking the position that 
     Iodine 131, which was released in enormous quantities from 
     Hanford, does not cause thyroid cancer. Is that the position 
     of the Department of Energy? If not, please explain if the 
     Department is taking the position that the Price Anderson Act 
     does not apply to a person exposed to radiation below a 
     certain dose, and if so what that dose is.
       I understand that several million dollars more could be 
     spent in the next year or two continuing to defend this 
     action. That would result in taxpayers' money approaching the 
     $100,000,000 being paid to lawyers to prevent compensation to 
     victims of radiation exposure from Hanford.
       All of the defenses you have previously supported have been 
     rejected by a federal court. Has the Department of Energy 
     authorized any amount of money for settlement of this case? 
     It would appear that more money may well be spent to thwart 
     the intent of the Price Anderson Act than would be spent in 
     victims' compensation.
       Please provide me with a detailed justification for any 
     continued payment by the Department of Energy for the defense 
     of this litigation, including specific justifications for any 
     motions currently or intending to be filed or appealed 
     seeking to dismiss most or all of the cases and why such 
     action does not violate Congress' intent in enacting the PAA.
           Sincerely,
                                                    Peter DeFazio,
                                               Member of Congress.

  Mr. FARR. Madam Chairman, I rise in strong opposition to this so-
called comprehensive energy bill before us today. This energy package 
have a new wrapping and bow but it is the same white elephant gift for 
the American people that sadly passed in this House last Congress.
  Our Nation's energy policy must strike a sound balance by pursuing 
improvements in fuel technology and energy efficiency; maintaining a 
clean environment; and preserving our wilderness areas and public 
lands.
  Instead, by refusing to commit to improving and investing in 
sustainable fuel technology, we are putting our technology and 
manufacturing industries at a competitive disadvantage when the rest of 
the planet is searching for alternatives to fossil fuels.
  We are missing an opportunity here; as a future energy policy this 
legislation is bumbling along because of following the policies in this 
bill would be like driving into the future by looking through the 
rearview mirror with its heavily weighted dependence on fossil fuels.
  H.R. 6 falls depressingly short of addressing our energy needs in 
both the short and the long term.
  Based on the pro-industry recommendations of the Cheney Energy Task 
Force report, this bill is anti-taxpayer, anti-environment, anti-
consumer and is loaded down with special-interest giveaways.
  Madam Chairman, more than ninety percent of the subsidies in H.R. 6 
would go to the oil, gas, coal and nuclear industries, leading to more 
pollution, more oil drilling and more radioactive-waste-producing 
nuclear power.
  By contrast, only about six percent of the tax breaks would go to 
energy efficiency and renewable energy incentives that could actually 
save consumers money and reduce our dependence on dirty energy sources.
  Madam Chairman, gas prices, gas prices, gas prices and more gas 
prices. It's the most asked question I hear in my district and rightly 
so with prices in my home town of more than $3 a gallon and a national 
average price at a record level of $2.24 a gallon--more than 50 percent 
higher than average gas prices in 2002.
  According to the Bush Administration's own Energy Department 
estimates, this Republican bill will actually increase gas prices by 3 
cents and will have virtually no effect on production, consumption, or 
barrel prices.
  American consumers are being squeezed at the pump while the big oil 
companies are reaping record profits and the Republican Leadership is 
passing an energy bill that will further raise gas prices.
  How in good faith can we go back to out constituencies with a 
national energy policy that does not address the future, does not 
address short term fixes or long term solutions.
  Madam Chairman, several provisions in H.R. 6 will weaken California's 
rights as a State to govern itself. These include changes in: LNG 
terminal siting, weakening the Coastal Zone Management Act, and 
expanding alternative energy projects situated on the Outer Continental 
Shelf (OCS).
  The bill will hand over exclusive jurisdiction for the siting of 
liquefied natural gas (LNG) facilities to the Federal Energy Regulatory 
Commission (FERC), preventing the states from having a role in 
approving the location of LNG terminals and the conditions under which 
these terminals must operate. This bill even goes as far as making the 
States seek FERC permission before conducting safety inspections! Plus, 
they will be barred from taking any independent enforcement action 
against LNG terminal operators for safety violations.
  H.R. 6 weakens California's rights under the CZMA to object to a 
FERC-approved coastal pipeline or energy facility project when the 
project is inconsistent with the State's federally-approved coastal 
management program. Currently when there is a disagreement about

[[Page 7130]]

a project, the Secretary of Commerce, through an administrative appeals 
process, determines whether and under what conditions the project can 
go forward. States can present new evidence supporting their arguments 
to the Secretary.
  Under H.R. 6, states will not be allowed to present new evidence to 
the Secretary, and the Secretary will not be allowed to seek out 
evidence on his or her own. The Secretary will only be allowed to rely 
on the record compiled by FERC. Furthermore, the bill imposes an 
expedited timeline for appeals, which may not allow a full review of 
the facts.
  We have to protect our shores and near waters. H.R. 6 will give the 
Department of Interior permitting authority for ``alternative'' energy 
projects, such as wind projects, situated on the Outer Continental 
Shelf (OCS). It also grants the Department of Interior authority to 
permit other types of energy facilities, including facilities to 
``support the exploration, development, production, transportation, or 
storage of oil, natural gas, or other minerals''.
  Another very dear issue in California is the fuel additive MTBE 
(methyl tertiary butyl ether), I oppose shielding MTBE producers from 
product liability lawsuits, thereby forcing taxpayers to pick up the 
tab to clean up contaminated groundwater in places such as the Salinas 
Valley, the salad bowl of the world, which has already tested positive 
for MTBE.
  The bill even includes a $2 billion taxpayer-financed subsidy to MTBE 
producers to convert facilities to produce other chemicals.
  The obvious gouging of California consumers is significant evidence 
that the electricity energy market lacks much needed controls.
  Does H.R. 6 correct this? NO--Instead of protecting Americans from 
the market manipulation that has become all too prevalent, H.R. 6 is 
weighed down by special interest exemptions that will do more harm than 
good.
  The bill does not give federal regulators the tools they need to 
prevent and punish bad actors like Enron who manipulate power markets. 
Instead H.R. 6 offers cosmetic reforms.
  Moreover, the bill does nothing to provide refunds to my constituents 
and West Coast consumers who paid unjust and unreasonable electricity 
prices during 2000-2001.
  Madam Chairman, it's plain and simple--H.R. 6: fails to lower 
gasoline prices; fails to improve our nation's energy efficiency or 
promote sustainable alternatives; fails to adequately address future 
infrastructure needs; fails to learn from the lessons of the California 
electricity crisis; and fails to prevent future ``Enrons'' from 
manipulating energy markets at the expense of consumers.
  I urge my colleagues to oppose this legislation so we can develop a 
comprehensive energy policy that looks to the future and doesn't rely 
on repackaged outdated technologies from the past.
  Mr. KING of Iowa. I rise today in strong support of H.R. 6, the 
Energy Policy Act. We need a balanced energy policy in this country, 
and this bill takes great strides towards achieving that balance.
  As a founding co-chair of the House Ag Energy Users Caucus, I am 
concerned that the Corn Belt is being held hostage to high gas, diesel 
and natural gas prices. Farmers utilize diesel and gasoline to operate 
their equipment and transport their product. Farmers have had to 
tighten their belts as prices have increased. Therefore, I am in strong 
support of this energy bill that allows for exploration in the Arctic 
National Wildlife Reserve (ANWR), which will allow for more domestic 
supply of oil.
  Nothing has caused more concern for agriculture than the price of 
natural gas. Natural gas is the primary feedstock for anhydrous ammonia 
and other fertilizers and accounts for 90 percent of the cost of making 
nitrogen fertilizer. The surge in natural gas prices over the last 4 
years has been a key reason why nitrogen fertilizer costs have jumped 
by nearly 50 percent at the farm level. This rise in prices has 
contributed to the growing reliance on imported fertilizer. For that 
reason, I am in strong support of the natural gas provisions in this 
bill and would urge Members to oppose amendments that would weaken any 
natural gas provisions in the bill.
  Finally Madam Chairman, most of my colleagues know that Iowa is not 
only a consumer of energy, but a producer of energy. The Fifth District 
of Iowa is an energy export center, exporting ethanol and biodiesel all 
across this nation. This bill includes a 5 billion gallon Renewable 
Fuels Standard that will be good for our energy independence while 
securing rural economies. However, I want to see the bill come back 
from conference with an 8 billion gallon standard.
  I urge my colleagues to vote in favor of the Energy Policy Act.
  Ms. SCHWARTZ of Pennsylvania. Madam Chairman, I rise today in strong 
opposition to the Energy Policy Act of 2005.
  Madam Chairman, this bill represents a lost opportunity. Now, more 
than ever, we need an energy bill that will wean the Nation off of 
foreign oil. We need to do this so hard-working Americans are no longer 
subjected to the ever-rising costs of gasoline and we have to do this 
for the safety and security of our Nation.
  In my home district, the average price for a gallon of regular 
unleaded is $2.22 compared to $1.76 just one year ago. Yet, the bill 
before us will do nothing to relieve Americans from the skyrocketing 
costs of gas. My colleagues, even the Bush Administration recognizes 
this; with the Energy Information Administration saying that the bill 
would actually increase gas prices rather than reduce them.
  What's worse is that while the bill does nothing to relieve Americans 
of their burden at the gas pump, it also takes an additional $7.5 
billion out of their pockets as a tax giveaway to oil, gas, coal and 
nuclear industries--industries that are earning record profits--without 
setting a course towards energy independence. The President himself 
said, just last week, ``With $55 oil we don't need incentives for oil 
and gas companies to explore. There are plenty of incentives.''
  This Congress needs to establish an energy policy that sets America 
free from its dependence on imported oil. Yet, only seven percent of 
the tax incentives in this bill will go towards renewable energy and 
energy efficiency--leaving us to be reliant on the same old energy 
sources.
  H.R. 6 is, unfortunately, par for the course for the Republican 
Leadership, which has turned a blind eye to scientific discovery--be it 
medical, physical, or otherwise. America cannot continue to be a world 
leader with regard to scientific discovery unless we invest and provide 
incentives, including for energy sources of the future.
  In addition to its misdirected energy priorities, the bill contains 
several dirty little footnotes. It will pollute our air and water and 
exploit our federal lands. It exempts MTBE manufacturers from cleaning 
up the groundwater they polluted--violating our Nation's longstanding 
polluter pay policy. It will let oil and gas companies off the hook 
from the Safe Water Drinking Act--allowing them to skirt water 
standards.
  Mr. Speaker, we cannot continue to go down the same worn out path. We 
must set the Nation on a course to energy independence which means 
promoting cleaner, less expensive energy that we control. That requires 
a balanced energy policy that aids domestic production but, more 
importantly, sends us in a new direction by investing in renewable and 
energy efficient technologies. Unfortunately, H.R. 6 does not meet this 
goal, leaving our Senate colleagues to find a better way. Hopefully, 
they will be able to craft a bill that achieves a better balance than 
this legislation.
  I urge a ``no'' vote on H.R. 6.

                              {time}  1700

  The CHAIRMAN. All time for general debate has expired.
  Pursuant to the rule, the bill shall be considered read for amendment 
under the 5-minute rule.
  The text of H.R. 6 is as follows:

                                 H.R. 6

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

     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 for the bill 
     is as follows:

Sec. 1. Short title; table of contents.

                       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. 107. Voluntary commitments to reduce industrial energy intensity.
Sec. 108. Advanced Building Efficiency Testbed.
Sec. 109. Federal building performance standards.
Sec. 111. Daylight savings.

            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.

                 Subtitle C--Energy Efficient Products

Sec. 131. Energy Star Program.

[[Page 7131]]

Sec. 132. HVAC maintenance consumer education program.
Sec. 133. Energy conservation standards for additional products.
Sec. 134. Energy labeling.
Sec. 135. Preemption.
Sec. 136. State consumer product energy efficiency standards.

                       Subtitle D--Public Housing

Sec. 141. Capacity building for energy-efficient, affordable housing.
Sec. 142. Increase of cdbg public services cap for energy conservation 
              and efficiency activities.
Sec. 143. FHA mortgage insurance incentives for energy efficient 
              housing.
Sec. 144. Public housing capital fund.
Sec. 145. Grants for energy-conserving improvements for assisted 
              housing.
Sec. 147. Energy-efficient appliances.
Sec. 148. Energy efficiency standards.
Sec. 149. 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. Insular areas energy security.
Sec. 205. Use of photovoltaic energy in public buildings.
Sec. 206. Grants to improve the commercial value of forest biomass for 
              electric energy, useful heat, transportation fuels, 
              petroleum-based product substitutes, and other commercial 
              purposes.
Sec. 207. Biobased products.
Sec. 208. Renewable energy security.

                       Subtitle C--Hydroelectric

                     Part I--Alternative conditions

Sec. 231. Alternative conditions and fishways.

                     Part II--Additional hydropower

Sec. 241. Hydroelectric production incentives.
Sec. 242. Hydroelectric efficiency improvement.
Sec. 243. Small hydroelectric power projects.
Sec. 244. Increased hydroelectric generation at existing Federal 
              facilities.
Sec. 245. Shift of project loads to off-peak periods.

                    TITLE III--OIL AND GAS--COMMERCE

           Subtitle A--Petroleum Reserve and Home Heating Oil

Sec. 301. Permanent authority to operate the Strategic Petroleum 
              Reserve and other energy programs.
Sec. 302. National Oilheat Research Alliance.
Sec. 303. Site selection.
Sec. 304. Suspension of Strategic Petroleum Reserve deliveries.

                   Subtitle B--Production Incentives

Sec. 320. Liquefaction or gasification natural gas terminals.
Sec. 327. Hydraulic fracturing.
Sec. 328. Oil and gas exploration and production defined.
Sec. 329. Outer Continental Shelf provisions.
Sec. 330. Appeals relating to pipeline construction or offshore mineral 
              development projects.
Sec. 333. Natural gas market transparency.

                   Subtitle C--Access to Federal Land

Sec. 344. Consultation regarding oil and gas leasing on public land.
Sec. 346. Compliance with executive order 13211; actions concerning 
              regulations that significantly affect energy supply, 
              distribution, or use.
Sec. 355. Encouraging Great Lakes oil and gas drilling ban.
Sec. 358. Federal coalbed methane regulation.

                  Subtitle D--Refining Revitalization

Sec. 371. Short title.
Sec. 372. Findings.
Sec. 373. Purpose.
Sec. 374. Designation of Refinery Revitalization Zones.
Sec. 375. Memorandum of understanding.
Sec. 376. State environmental permitting assistance.
Sec. 377. Coordination and expeditious review of permitting process.
Sec. 378. Compliance with all environmental regulations required.
Sec. 379. Definitions.

                             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. Coal technology loan.
Sec. 412. Coal gasification.
Sec. 414. Petroleum coke gasification.
Sec. 416. Electron scrubbing demonstration.

                 Subtitle D--Coal and Related Programs

Sec. 441. Clean air coal program.

                         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.

                       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 of Energy 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. Prohibition on assumption by United States Government of 
              liability for certain foreign incidents.
Sec. 611. Civil penalties.
Sec. 612. Financial accountability.

                  Subtitle B--General Nuclear Matters

Sec. 621. Licenses.
Sec. 622. NRC training program.
Sec. 623. Cost recovery from government agencies.
Sec. 624. Elimination of pension offset.
Sec. 625. Antitrust review.
Sec. 626. Decommissioning.
Sec. 627. Limitation on legal fee reimbursement.
Sec. 629. Report on feasibility of developing commercial nuclear energy 
              generation facilities at existing Department of Energy 
              sites.
Sec. 630. Uranium sales.
Sec. 631. Cooperative research and development and special 
              demonstration projects for the uranium mining industry.
Sec. 632. Whistleblower protection.
Sec. 633. Medical isotope production.
Sec. 634. Fernald byproduct material.
Sec. 635. Safe disposal of greater-than-class c radioactive waste.
Sec. 636. Prohibition on nuclear exports to countries that sponsor 
              terrorism.
Sec. 638. National uranium stockpile.
Sec. 639. Nuclear Regulatory Commission meetings.
Sec. 640. Employee benefits.

         Subtitle C--Additional Hydrogen Production Provisions

Sec. 651. Hydrogen production programs.
Sec. 652. Definitions.

                      Subtitle D--Nuclear Security

Sec. 661. Nuclear facility threats.
Sec. 662. Fingerprinting for criminal history record checks.
Sec. 663. Use of firearms by security personnel of licensees and 
              certificate holders of the Commission.
Sec. 664. Unauthorized introduction of dangerous weapons.
Sec. 665. Sabotage of nuclear facilities or fuel.
Sec. 666. Secure transfer of nuclear materials.
Sec. 667. Department of Homeland Security consultation.
Sec. 668. Authorization of appropriations.

                     TITLE VII--VEHICLES AND FUELS

                     Subtitle A--Existing Programs

Sec. 701. Use of alternative fuels by dual-fueled vehicles.
Sec. 704. Incremental cost allocation.
Sec. 705. Lease condensates.
Sec. 706. Review of Energy Policy Act of 1992 programs.
Sec. 707. Report concerning compliance with alternative fueled vehicle 
              purchasing requirements.

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

                        Part 1--Hybrid vehicles

Sec. 711. Hybrid vehicles.
Sec. 712. Hybrid retrofit and electric conversion program.

                       Part 2--Advanced vehicles

Sec. 721. Definitions.
Sec. 722. Pilot program.
Sec. 723. Reports to Congress.
Sec. 724. Authorization of appropriations.

                        Part 3--Fuel cell buses

Sec. 731. Fuel cell transit bus demonstration.

                     Subtitle C--Clean School Buses

Sec. 741. Definitions.
Sec. 742. Program for replacement of certain school buses with clean 
              school buses.
Sec. 743. Diesel retrofit program.
Sec. 744. 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. 756. Reduction of engine idling of heavy-duty vehicles.
Sec. 757. Biodiesel engine testing program.
Sec. 758. High occupancy vehicle exception.
Sec. 759. Ultra-efficient engine technology for aircraft.

[[Page 7132]]

                   Subtitle E--Automobile Efficiency

Sec. 771. Authorization of appropriations for implementation and 
              enforcement of fuel economy standards.
Sec. 772. Revised considerations for decisions on maximum feasible 
              average fuel economy.
Sec. 773. Extension of maximum fuel economy increase for alternative 
              fueled vehicles.
Sec. 774. Study of feasibility and effects of reducing use of fuel for 
              automobiles.

                          TITLE VIII--HYDROGEN

Sec. 801. Definitions.
Sec. 802. Plan.
Sec. 803. Programs.
Sec. 804. Interagency task force.
Sec. 805. Advisory Committee.
Sec. 806. External review.
Sec. 807. Miscellaneous provisions.
Sec. 808. Savings clause.
Sec. 809. Authorization of appropriations.
Sec. 810. Solar and wind technologies.

                   TITLE IX--RESEARCH AND DEVELOPMENT

Sec. 900. Short title; definitions.

                      Subtitle A--Science Programs

Sec. 901. Office of Science programs.
Sec. 902. Systems biology program.
Sec. 903. Catalysis Research and Development Program.
Sec. 904. Hydrogen.
Sec. 905. Advanced scientific computing research.
Sec. 906.  Fusion Energy Sciences program.
Sec. 907. Science and Technology Scholarship Program.
Sec. 908. Office of Scientific and Technical Information.
Sec. 909. Science and engineering pilot program.
Sec. 910. Authorization of appropriations.

           Subtitle B--Research Administration and Operations

Sec. 911. Cost Sharing.
Sec. 912. Reprogramming.
Sec. 913. Merit-based competition.
Sec. 914. External technical review of departmental programs.
Sec. 915. Competitive award of management contracts.
Sec. 916. National Laboratory designation.
Sec. 917. Report on equal employment opportunity practices.
Sec. 918. User facility best practices plan.
Sec. 919. Support for science and energy infrastructure and facilities.
Sec. 920. Coordination plan.
Sec. 921. Availability of funds.

                     Subtitle C--Energy Efficiency

             Chapter 1--Vehicles, Buildings, and Industries

Sec. 922. Programs.
Sec. 923. Vehicles.
Sec. 924. Buildings.
Sec. 925. Industries.
Sec. 926. Demonstration and commercial application.
Sec. 927. Secondary electric vehicle battery use program.
Sec. 928. Next generation lighting initiative.
Sec. 929. Definitions.
Sec. 930. Authorization of appropriations.
Sec. 931. Limitation on use of funds.

       Chapter 2--Distributed Energy and Electric Energy Systems

Sec. 932. Distributed energy.
Sec. 933. Electricity transmission and distribution and energy 
              assurance.
Sec. 933A. Advanced portable power devices.
Sec. 934. Authorization of appropriations.

                      Subtitle D--Renewable energy

Sec. 935. Findings.
Sec. 936. Definitions.
Sec. 937. Programs.
Sec. 938. Solar.
Sec. 939. Bioenergy programs.
Sec. 940. Wind.
Sec. 941. Geothermal.
Sec. 942. Photovoltaic demonstration program.
Sec. 943. Additional programs.
Sec. 944. Analysis and evaluation.
Sec. 945. Authorization of appropriations.

                  Subtitle E--Nuclear Energy Programs

Sec. 946. Definition.
Sec. 947. Programs.

              Chapter 1--Nuclear Energy Research Programs

Sec. 948. Advanced fuel recycling program.
Sec. 949. University nuclear science and engineering support.
Sec. 950. University-National Laboratory interactions.
Sec. 951. Nuclear Power 2010 Program.
Sec. 952. Generation IV Nuclear Energy Systems Initiative.
Sec. 953. Civilian infrastructure and facilities.
Sec. 954. Nuclear energy research and development infrastructure plan.
Sec. 955. Idaho National Laboratory facilities plan.
Sec. 956. Authorization of appropriations.

            Chapter 2--Next Generation Nuclear Plant Program

Sec. 957. Definitions.
Sec. 958. Next generation nuclear power plant.
Sec. 959. Advisory committee.
Sec. 960. Program requirements.
Sec. 961. Authorization of appropriations.

                       Subtitle F--Fossil Energy

                      Chapter 1--Research Programs

Sec. 962. Enhanced fossil energy research and development programs.
Sec. 963. Fossil research and development.
Sec. 964. Oil and gas research and development.
Sec. 965. Transportation fuels.
Sec. 966. Fuel cells.
Sec. 967. Carbon dioxide capture research and development.
Sec. 968. Authorization of appropriations.

  Chapter 2--Ultra-Deepwater and Unconventional Natural Gas and Other 
                          Petroleum Resources

Sec. 969. Program authority.
Sec. 970. Ultra-deepwater and unconventional onshore natural gas and 
              other petroleum research and development program.
Sec. 971. Additional requirements for awards.
Sec. 972. Advisory committees.
Sec. 973. Limits on participation.
Sec. 974. Sunset.
Sec. 975. Definitions.
Sec. 976. Funding.

 Subtitle G--Improved coordination and management of civilian science 
                        and technology programs

Sec. 978. Improved coordination and management of civilian science and 
              technology programs.

                TITLE X--DEPARTMENT OF ENERGY MANAGEMENT

Sec. 1002. Other transactions authority.
Sec. 1003. University collaboration.
Sec. 1004. Sense of Congress.

                         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.
Sec. 1222. Third-party finance.
Sec. 1223. Transmission system monitoring.
Sec. 1224. Advanced transmission technologies.
Sec. 1225. Electric transmission and distribution programs.
Sec. 1226. Advanced Power System Technology Incentive Program.
Sec. 1227. Office of Electric Transmission and Distribution.

            Subtitle C--Transmission Operation Improvements

Sec. 1231. Open nondiscriminatory access.
Sec. 1232. Sense of Congress on Regional Transmission Organizations.
Sec. 1233. Regional Transmission Organization applications progress 
              report.
Sec. 1234. Federal utility participation in Regional Transmission 
              Organizations.
Sec. 1235. Standard market design.
Sec. 1236. Native load service obligation.
Sec. 1237. Study on the benefits of economic dispatch.

                  Subtitle D--Transmission Rate Reform

Sec. 1241. Transmission infrastructure investment.

                    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. Market transparency rules.
Sec. 1282. Market manipulation.
Sec. 1283. Enforcement.
Sec. 1284. Refund effective date.
Sec. 1285. Refund authority.
Sec. 1286. Sanctity of contract.
Sec. 1287. Consumer privacy and unfair trade practices.

                       Subtitle H--Merger Reform

Sec. 1291. Merger review reform and accountability.
Sec. 1292. Electric utility mergers.

                        Subtitle I--Definitions

Sec. 1295. Definitions.

[[Page 7133]]

            Subtitle J--Technical and Conforming Amendments

Sec. 1297. Conforming amendments.

                     Subtitle K--Economic Dispatch

Sec. 1298. Economic dispatch.

                   TITLE XIII--ENERGY TAX INCENTIVES

Sec. 1300. Short title; etc.

            Subtitle A--Energy Infrastructure Tax Incentives

Sec. 1301. Natural gas gathering lines treated as 7-year property.
Sec. 1302. Natural gas distribution lines treated as 15-year property.
Sec. 1303. Electric transmission property treated as 15-year property.
Sec. 1304. Expansion of amortization for certain atmospheric pollution 
              control facilities in connection with plants first placed 
              in service after 1975.
Sec. 1305. Modification of credit for producing fuel from a 
              nonconventional source.
Sec. 1306. Modifications to special rules for nuclear decommissioning 
              costs.
Sec. 1307. Arbitrage rules not to apply to prepayments for natural gas.
Sec. 1308. Determination of small refiner exception to oil depletion 
              deduction.

            Subtitle B--Miscellaneous Energy Tax Incentives

Sec. 1311. Credit for residential energy efficient property.
Sec. 1312. Credit for business installation of qualified fuel cells.
Sec. 1313. Reduced motor fuel excise tax on certain mixtures of diesel 
              fuel.
Sec. 1314. Amortization of delay rental payments.
Sec. 1315. Amortization of geological and geophysical expenditures.
Sec. 1316. Advanced lean burn technology motor vehicle credit.
Sec. 1317. Credit for energy efficiency improvements to existing homes.

               Subtitle C--Alternative minimum tax relief

Sec. 1321. New nonrefundable personal credits allowed against regular 
              and minimum taxes.
Sec. 1322. Certain business energy credits allowed against regular and 
              minimum taxes.

                        TITLE XIV--MISCELLANEOUS

                      Subtitle C--Other Provisions

Sec. 1441. Continuation of transmission security order.
Sec. 1442. Review of agency determinations.
Sec. 1443. Attainment dates for downwind ozone nonattainment areas.
Sec. 1444. Energy production incentives.
Sec. 1446. Regulation of certain oil used in transformers.
Sec. 1447. Risk assessments.
Sec. 1448. Oxygen-fuel.
Sec. 1449. Petrochemical and oil refinery facility health assessment.
Sec. 1450. United States-Israel cooperation.
Sec. 1451. Carbon-based fuel cell development.

                   TITLE XV--ETHANOL AND MOTOR FUELS

                     Subtitle A--General Provisions

Sec. 1501. Renewable content of motor vehicle fuel.
Sec. 1502. Fuels safe harbor.
Sec. 1503. Findings and MTBE transition assistance.
Sec. 1504. Use of MTBE.
Sec. 1505. National Academy of Sciences review and presidential 
              determination.
Sec. 1506. Elimination of oxygen content requirement for reformulated 
              gasoline.
Sec. 1507. Analyses of motor vehicle fuel changes.
Sec. 1508. Data collection.
Sec. 1509. Reducing the proliferation of State fuel controls.
Sec. 1510. Fuel system requirements harmonization study.
Sec. 1511. Commercial byproducts from municipal solid waste and 
              cellulosic biomass loan guarantee program.
Sec. 1512. Cellulosic biomass and waste-derived ethanol conversion 
              assistance.
Sec. 1513. Blending of compliant reformulated gasolines.

            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.

                           TITLE XVI--STUDIES

Sec. 1601. Study on inventory of petroleum and natural gas storage.
Sec. 1605. Study of energy efficiency standards.
Sec. 1606. Telecommuting study.
Sec. 1607. LIHEAP report.
Sec. 1608. Oil bypass filtration technology.
Sec. 1609. Total integrated thermal systems.
Sec. 1610. University collaboration.
Sec. 1611. Reliability and consumer protection assessment.
Sec. 1612. Report on energy integration with Latin America.
Sec. 1613. Low-volume gas reservoir study.

                      TITLE XVII--RENEWABLE ENERGY

Sec. 1701. Grants to improve the commercial value of forest biomass for 
              electric energy, useful heat, transportation fuels, 
              petroleum-based product substitutes, and other commercial 
              purposes.
Sec. 1702. Environmental review for renewable energy projects.
Sec. 1703. Sense of Congress regarding generation capacity of 
              electricity from renewable energy resources on public 
              lands.

                     TITLE XVIII--GEOTHERMAL ENERGY

Sec. 1801. Short title.
Sec. 1802. Competitive lease sale requirements.
Sec. 1803. Direct use.
Sec. 1804. Royalties and near-term production incentives.
Sec. 1805. Expediting administrative action for geothermal leasing.
Sec. 1806. Coordination of geothermal leasing and permitting on Federal 
              lands.
Sec. 1807. Review and report to Congress.
Sec. 1808. Reimbursement for costs of NEPA analyses, documentation, and 
              studies.
Sec. 1809. Assessment of geothermal energy potential.
Sec. 1810. Cooperative or unit plans.
Sec. 1811. Royalty on byproducts.
Sec. 1812. Repeal of authorities of Secretary to readjust terms, 
              conditions, rentals, and royalties.
Sec. 1813. Crediting of rental toward royalty.
Sec. 1814. Lease duration and work commitment requirements.
Sec. 1815. Advanced royalties required for suspension of production.
Sec. 1816. Annual rental.
Sec. 1817. Deposit and use of geothermal lease revenues for 5 fiscal 
              years.
Sec. 1818. Repeal of acreage limitations.
Sec. 1819. Technical amendments.
Sec. 1820. Intermountain West Geothermal Consortium.

                         TITLE XIX--HYDROPOWER

Sec. 1901. Increased hydroelectric generation at existing Federal 
              facilities.
Sec. 1902. Shift of project loads to off-peak periods.
Sec. 1903. Report identifying and describing the status of potential 
              hydropower facilities.

                    TITLE XX--OIL AND GAS--RESOURCES

                   Subtitle A--Production incentives

Sec. 2001. Definition of Secretary.
Sec. 2002. Program on oil and gas royalties in-kind.
Sec. 2003. Marginal property production incentives.
Sec. 2004. Incentives for natural gas production from deep wells in the 
              shallow waters of the Gulf of Mexico.
Sec. 2005. Royalty relief for deep water production.
Sec. 2006. Alaska offshore royalty suspension.
Sec. 2007. Oil and gas leasing in the National Petroleum Reserve in 
              Alaska.
Sec. 2008. Orphaned, abandoned, or idled wells on Federal land.
Sec. 2009. Combined hydrocarbon leasing.
Sec. 2010. Alternate energy-related uses on the outer Continental 
              Shelf.
Sec. 2011. Preservation of geological and geophysical data.
Sec. 2012. Oil and gas lease acreage limitations.
Sec. 2013. Deadline for decision on appeals of consistency 
              determination under the Coastal Zone Management Act of 
              1972.
Sec. 2014. Reimbursement for costs of NEPA analyses, documentation, and 
              studies.
Sec. 2015. Gas hydrate production incentive.
Sec. 2016. Onshore deep gas production incentive.
Sec. 2017. Enhanced oil and natural gas production incentive.
Sec. 2018. Oil shale.
Sec. 2019. Use of information about oil and gas public challenges.

                   Subtitle B--Access to Federal land

Sec. 2021. Office of Federal Energy Project Coordination.
Sec. 2022. Federal onshore oil and gas leasing and permitting 
              practices.
Sec. 2023. Management of Federal oil and gas leasing programs.
Sec. 2024. Consultation regarding oil and gas leasing on public land.

[[Page 7134]]

Sec. 2025. Estimates of oil and gas resources underlying onshore 
              Federal land.
Sec. 2026. Compliance with executive order 13211; actions concerning 
              regulations that significantly affect energy supply, 
              distribution, or use.
Sec. 2027. Pilot project to improve Federal permit coordination.
Sec. 2028. Deadline for consideration of applications for permits.
Sec. 2029. Clarification of fair market rental value determinations for 
              public land and Forest Service rights-of-way.
Sec. 2030. Energy facility rights-of-way and corridors on Federal land.
Sec. 2031. Consultation regarding energy rights-of-way on public land.
Sec. 2032. Electricity transmission line right-of-way, Cleveland 
              National Forest and adjacent public land, California.
Sec. 2033. Sense of Congress regarding development of minerals under 
              Padre Island National Seashore.
Sec. 2034. Livingston Parish mineral rights transfer.

                  Subtitle C--Naval Petroleum Reserves

Sec. 2041. Transfer of administrative jurisdiction and environmental 
              remediation, Naval Petroleum Reserve Numbered 2, Kern 
              County, California.
Sec. 2042. Land conveyance, portion of Naval Petroleum Reserve Numbered 
              2, to City of Taft, California.
Sec. 2043. Revocation of land withdrawal.
Sec. 2044. Effect of transfer and conveyance.

                  Subtitle D--Miscellaneous Provisions

Sec. 2051. Split-estate Federal oil and gas leasing and development 
              practices.
Sec. 2052. Royalty payments under leases under the Outer Continental 
              Shelf Lands Act.
Sec. 2053. Domestic offshore energy reinvestment.
Sec. 2054. Repurchase of leases that are not allowed to be explored or 
              developed.

                            TITLE XXI--COAL

Sec. 2101. Short title.
Sec. 2102. Lease modifications for contiguous coal lands or coal 
              deposits.
Sec. 2103. Approval of logical mining units.
Sec. 2104. Payment of advance royalties under coal leases.
Sec. 2105. Elimination of deadline for submission of coal lease 
              operation and reclamation plan.
Sec. 2106. Amendment relating to financial assurances with respect to 
              bonus bids.
Sec. 2107. Inventory requirement.
Sec. 2108. Application of amendments.
Sec. 2109. Resolution of Federal resource development conflicts in the 
              Powder River Basin.

            TITLE XXII--ARCTIC COASTAL PLAIN DOMESTIC ENERGY

Sec. 2201. Short title.
Sec. 2202. Definitions.
Sec. 2203. Leasing program for lands within the coastal plain.
Sec. 2204. Lease sales.
Sec. 2205. Grant of leases by the Secretary.
Sec. 2206. Lease terms and conditions.
Sec. 2207. Coastal Plain environmental protection.
Sec. 2208. Expedited judicial review.
Sec. 2209. Federal and State distribution of revenues.
Sec. 2210. Rights-of-way across the Coastal Plain.
Sec. 2211. Conveyance.
Sec. 2212. Local government impact aid and community service 
              assistance.

                  TITLE XXIII--SET AMERICA FREE (SAFE)

Sec. 2301. Short title.
Sec. 2302. Findings.
Sec. 2303. Purpose.
Sec. 2304. United States Commission on North American Energy Freedom.
Sec. 2305. North American energy freedom policy.

 TITLE XXV--GRAND CANYON HYDROGEN-POWERED TRANSPORTATION DEMONSTRATION

Sec. 2501. Short title.
Sec. 2502. Definitions.
Sec. 2503. Findings.
Sec. 2504. Research, development, and demonstration program.
Sec. 2505. Reports to Congress.
Sec. 2506. Authorization of appropriations.

                   TITLE XXVI--ADDITIONAL PROVISIONS

Sec. 2601. Limitation on required review under NEPA.
Sec. 2602. Enhancing energy efficiency in management of Federal lands.

                       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.
       (d) Energy Infrastructure.--The Architect of the Capitol, 
     building on the Master Plan Study completed in July 2000, 
     shall commission a study to evaluate the energy 
     infrastructure of the Capital Complex to determine how the 
     infrastructure could be augmented to become more energy 
     efficient, using unconventional and renewable energy 
     resources, in a way that would enable the Complex to have 
     reliable utility service in the event of power fluctuations, 
     shortages, or outages.
       (e) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Architect of the Capitol to carry 
     out subsection (d), $2,000,000 for each of fiscal years 2006 
     through 2010.

     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.''.

[[Page 7135]]

       (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 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.''.
       (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 or submetered. 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 energy 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 energy 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 submetering and the reduced 
     cost of operation and maintenance expected to result from 
     metering and submetering;
       ``(II) the extent to which metering and submetering are 
     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 and submetered 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.
       ``(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

[[Page 7136]]

     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 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) Limitations.--
       (1) In general.--Section 801(a) of the National Energy 
     Conservation Policy Act (42 U.S.C. 8287(a)) is amended by 
     adding at the end the following subparagraph:
       ``(E) All Federal agencies combined may not, after the date 
     of enactment of the Energy Policy Act of 2005, enter into 
     more than a total of 100 contracts under this title. Payments 
     made by the Federal Government under all contracts permitted 
     by this subparagraph combined shall not exceed a total of 
     $500,000,000. Each Federal agency shall appoint a coordinator 
     for Energy Savings Performance Contracts with the 
     responsibility to monitor the number of such contracts for 
     that Federal agency and the investment value of each 
     contract. The coordinators for each Federal agency shall meet 
     monthly to ensure that the limits specified in this 
     subparagraph on the number of contracts and the payments made 
     for the contracts are not exceeded.''.
       (2) Definition.--Section 804(1) of the National Energy 
     Conservation Policy Act (42 U.S.C. 8287c(1)) is amended to 
     read as follows:
       ``(1) The term `Federal agency' means the Department of 
     Defense, the Department of Veterans Affairs, and the 
     Department of Energy. ''.
       (3) Validity of contracts.--The amendments made by this 
     subsection shall not affect the validity of contracts entered 
     into under title VIII of the National Energy Conservation 
     Policy Act (42 U.S.C. 8287 et seq.) before the date of 
     enactment of this Act, or of contracts described in 
     subsection (h).
       (b) Permanent Extension.--Effective October 1, 2006, 
     section 801(c) of the National Energy Conservation Policy Act 
     (42 U.S.C. 8287(c)) is repealed.
       (c) Payment of Costs.--Section 802 of the National Energy 
     Conservation Policy Act (42 U.S.C. 8287a) is amended by 
     inserting ``, water, or wastewater treatment'' after 
     ``payment of energy''.
       (d) Energy Savings.--Section 804(2) of the National Energy 
     Conservation Policy Act (42 U.S.C. 8287c(2)) is amended to 
     read as follows:
       ``(2) The term `energy savings' means a reduction in the 
     cost of energy, water, or wastewater treatment, from a base 
     cost established through a methodology set forth in the 
     contract, used in an existing federally owned building or 
     buildings or other federally owned facilities as a result 
     of--
       ``(A) the lease or purchase of operating equipment, 
     improvements, altered operation and maintenance, or technical 
     services;
       ``(B) the increased efficient use of existing energy 
     sources by cogeneration or heat recovery, excluding any 
     cogeneration process for other than a federally owned 
     building or buildings or other federally owned facilities; or
       ``(C) the increased efficient use of existing water sources 
     in either interior or exterior applications.''.
       (e) Energy Savings Contract.--Section 804(3) of the 
     National Energy Conservation Policy Act (42 U.S.C. 8287c(3)) 
     is amended to read as follows:
       ``(3) The terms `energy savings contract' and `energy 
     savings performance contract' mean a contract that provides 
     for the performance of services for the design, acquisition, 
     installation, testing, and, where appropriate, operation, 
     maintenance, and repair, of an identified energy or water 
     conservation measure or series of measures at 1 or more 
     locations. Such contracts shall, with respect to an agency 
     facility that is a public building (as such term is defined 
     in section 3301 of title 40, United States Code), be in 
     compliance with the prospectus requirements and procedures of 
     section 3307 of title 40, United States Code.''.
       (f) Energy or Water Conservation Measure.--Section 804(4) 
     of the National Energy Conservation Policy Act (42 U.S.C. 
     8287c(4)) is amended to read as follows:
       ``(4) The term `energy or water conservation measure' 
     means--
       ``(A) an energy conservation measure, as defined in section 
     551; or
       ``(B) a water conservation measure that improves the 
     efficiency of water use, is life-cycle cost-effective, and 
     involves water conservation, water recycling or reuse, more 
     efficient treatment of wastewater or stormwater, improvements 
     in operation or maintenance efficiencies, retrofit 
     activities, or other related activities, not at a Federal 
     hydroelectric facility.''.
       (g) Review.--Not later than 180 days after the date of the 
     enactment of this Act, the Secretary of Energy shall complete 
     a review of the Energy Savings Performance Contract program 
     to identify statutory, regulatory, and administrative 
     obstacles that prevent Federal agencies from fully utilizing 
     the program. In addition, this review shall identify all 
     areas for increasing program flexibility and effectiveness, 
     including audit and measurement verification requirements, 
     accounting for energy use in determining savings, contracting 
     requirements, including the identification of additional 
     qualified contractors, and energy efficiency services 
     covered. The Secretary shall report these findings to 
     Congress and shall implement identified administrative and 
     regulatory changes to increase program flexibility and 
     effectiveness to the extent that such changes are consistent 
     with statutory authority.
       (h) 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, 2006, and before the date of enactment of this Act, shall 
     be deemed to have been entered into pursuant to such section 
     801 as amended by subsection (a) of this section.

     SEC. 107. VOLUNTARY COMMITMENTS TO REDUCE INDUSTRIAL ENERGY 
                   INTENSITY.

       (a) Voluntary Agreements.--The Secretary of Energy is 
     authorized to enter into voluntary agreements with 1 or more 
     persons in industrial sectors that consume significant 
     amounts of primary energy per unit of physical output to 
     reduce the energy intensity of their production activities by 
     a significant amount relative to improvements in each sector 
     in recent years.
       (b) Recognition.--The Secretary of Energy, in cooperation 
     with the Administrator of the Environmental Protection Agency 
     and other appropriate Federal agencies, shall recognize and 
     publicize the achievements of participants in voluntary 
     agreements under this section.
       (c) Definition.--In this section, the term ``energy 
     intensity'' means the primary energy consumed per unit of 
     physical output in an industrial process.

     SEC. 108. ADVANCED BUILDING EFFICIENCY TESTBED.

       (a) Establishment.--The Secretary of Energy, 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.

[[Page 7137]]

       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary of Energy 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. 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'' and inserting ``the 2003 International Energy 
     Conservation Code''; and
       (2) by adding at the end the following:
       ``(3) Revised Federal Building Energy Efficiency 
     Performance Standards.--
       ``(A) In general.--Not later than 1 year after the date of 
     enactment of this paragraph, the Secretary of Energy 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) such buildings be designed so as to achieve energy 
     consumption levels at least 30 percent below those of the 
     version current as of the date of enactment of this paragraph 
     of the ASHRAE Standard or the International Energy 
     Conservation Code, as appropriate; and
       ``(II) sustainable design principles are applied to the 
     siting, design, and construction of all new and replacement 
     buildings; and
       ``(ii) where water is used to achieve energy efficiency, 
     water conservation technologies shall be applied to the 
     extent they are life-cycle cost effective.
       ``(B) Additional revisions.--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 of Energy shall 
     determine, based on the cost-effectiveness of the 
     requirements under the amendments, whether the revised 
     standards established under this paragraph should be updated 
     to reflect the amendments.
       ``(C) Statement on compliance of new buildings.--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--
       ``(i) a list of all new Federal buildings owned, operated, 
     or controlled by the Federal agency; and
       ``(ii) a statement concerning whether the Federal buildings 
     meet or exceed the revised standards established under this 
     paragraph.''.

     SEC. 111. DAYLIGHT SAVINGS.

       (a) Repeal.--Section 3(a) of the Uniform Time Act of 1966 
     (15 U.S.C. 260a(a)) is amended--
       (1) by striking ``April'' and inserting ``March''; and
       (2) by striking ``October'' and inserting ``November''.
       (b) Report to Congress.--Not later than 9 months after the 
     date of enactment of this Act, the Secretary of Energy shall 
     report to Congress on the impact this section on energy 
     consumption in the United States.

            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 of Energy 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) Secretary.--The term ``Secretary'' means the Secretary 
     of Energy.
       (5) 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).
       (6) 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 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

[[Page 7138]]

     $50,000,000 for each of the fiscal years 2006 through 2010.

     SEC. 125. ENERGY EFFICIENT PUBLIC BUILDINGS.

       (a) Grants.--The Secretary of Energy 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 of Energy $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 of Energy 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 of Energy $20,000,000 for each of fiscal years 2006 
     through 2008.

                 Subtitle C--Energy Efficient Products

     SEC. 131. ENERGY STAR PROGRAM.

       (a) Amendment.--The Energy Policy and Conservation Act (42 
     U.S.C. 6201 et seq.) is amended by inserting the following 
     after section 324:

     ``SEC. 324A. ENERGY STAR PROGRAM.

       ``There is established at 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 efficiency standards. 
     Responsibilities under the program shall be divided between 
     the Department of Energy and the Environmental Protection 
     Agency consistent with the terms of agreements between the 2 
     agencies. The Administrator and the Secretary shall--
       ``(1) promote Energy Star compliant technologies as the 
     preferred technologies in the marketplace for achieving 
     energy efficiency and to reduce pollution;
       ``(2) work to enhance public awareness of the Energy Star 
     label, including special outreach to small businesses;
       ``(3) preserve the integrity of the Energy Star label;
       ``(4) solicit comments from interested parties prior to 
     establishing or revising an Energy Star product category, 
     specification, or criterion (or effective dates for any of 
     the foregoing);
       ``(5) upon 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 
     an explanation of such changes and, where appropriate, 
     responses to comments submitted by interested parties; and
       ``(6) provide appropriate lead time (which shall be 9 
     months, unless the Agency or Department determines otherwise) 
     prior to the 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.''.
       (b) Table of Contents Amendment.--The table of contents of 
     the Energy Policy and Conservation Act is amended by 
     inserting after the item relating to section 324 the 
     following new item:

``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:
       ``(c) HVAC Maintenance.--For the purpose of ensuring that 
     installed air conditioning and heating systems operate at 
     their 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 resulting 
     from properly conducted maintenance of air conditioning, 
     heating, and ventilating systems. The Secretary shall carry 
     out the program in a cost-shared manner in cooperation with 
     the Administrator of the Environmental Protection Agency and 
     such other entities as the Secretary considers appropriate, 
     including industry trade associations, industry members, and 
     energy efficiency organizations.
       ``(d) Small Business Education and Assistance.--The 
     Administrator of the Small Business Administration, in 
     consultation with the Secretary of Energy and the 
     Administrator of the Environmental Protection Agency, shall 
     develop and coordinate a Government-wide program, building on 
     the existing Energy Star for Small Business Program, to 
     assist small businesses to become more energy efficient, 
     understand the cost savings obtainable through efficiencies, 
     and identify financing options for energy efficiency 
     upgrades. The Secretary and the Administrator of the Small 
     Business Administration shall make the program information 
     available directly to small businesses and through other 
     Federal agencies, including the Federal Emergency Management 
     Program and the Department of Agriculture.''.

     SEC. 133. 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 (30)(S), by striking the period and adding 
     at the end the following: ``but does not include any lamp 
     specifically designed to be used for special purpose 
     applications and that is unlikely to be used in general 
     purpose applications such as those described in subparagraph 
     (D), and also does not include any lamp not described in 
     subparagraph (D) that is excluded by the Secretary, by rule, 
     because the lamp is designed for special applications and is 
     unlikely to be used in general purpose applications.''; and
       (2) by adding at the end the following:
       ``(32) The term `battery charger' means a device that 
     charges batteries for consumer products and includes battery 
     chargers embedded in other consumer products.
       ``(33) The term `commercial refrigerators, freezers, and 
     refrigerator-freezers' means refrigerators, freezers, or 
     refrigerator-freezers that--
       ``(A) are not consumer products regulated under this Act; 
     and
       ``(B) incorporate most components involved in the vapor-
     compression cycle and the refrigerated compartment in a 
     single package.
       ``(34) The term `external power supply' means an external 
     power supply circuit that is used to convert household 
     electric current into either DC current or lower-voltage AC 
     current to operate a consumer product.
       ``(35) 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 illuminates the legend `EXIT' and any directional 
     indicators and provides contrast between the legend, any 
     directional indicators, and the background.
       ``(36)(A) Except as provided in subparagraph (B), 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.

[[Page 7139]]

       ``(B) The term `distribution transformer' does not 
     include--
       ``(i) transformers with multiple voltage taps, with the 
     highest voltage tap equaling at least 20 percent more than 
     the lowest voltage tap;
       ``(ii) transformers, such as those commonly known as drive 
     transformers, rectifier transformers, auto-transformers, 
     Uninterruptible Power System transformers, impedance 
     transformers, regulating transformers, sealed and 
     nonventilating transformers, machine tool transformers, 
     welding transformers, grounding transformers, or testing 
     transformers, that are designed to be used in a special 
     purpose application and are unlikely to be used in general 
     purpose applications; 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.
       ``(37) 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.
       ``(38) The term `standby mode' means the lowest power 
     consumption mode that--
       ``(A) cannot be switched off or influenced by the user; and
       ``(B) may persist for an indefinite time when an appliance 
     is connected to the main electricity supply and used in 
     accordance with the manufacturer's instructions,

     as defined on an individual product basis by the Secretary.
       ``(39) The term `torchiere' means a portable electric lamp 
     with a reflector bowl that directs light upward so as to give 
     indirect illumination.
       ``(40) The term `traffic signal module' means a standard 8-
     inch (200mm) or 12-inch (300mm) traffic signal indication, 
     consisting of a light source, a lens, and all other parts 
     necessary for operation, that communicates movement messages 
     to drivers through red, amber, and green colors.
       ``(41) 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.
       ``(42) The term `unit heater' means a self-contained fan-
     type heater designed to be installed within the heated space, 
     except that such term does not include a warm air furnace.
       ``(43) The term `ceiling fan' means a non-portable device 
     that is suspended from a ceiling for circulating air via the 
     rotation of fan blades.
       ``(44) The term `ceiling fan light kit' means equipment 
     designed to provide light from a ceiling fan which 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 package at the time of 
     sale or sold separately for subsequent attachment to the 
     fan.''.
       (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) 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). The Secretary may review and revise this test 
     procedure. For purposes of section 346(a), this test 
     procedure shall be deemed to be 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 be 
     technologically feasible and economically justified, and 
     would result in significant energy savings.
       ``(11) Test procedures for traffic signal 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) Test procedures for medium base compact fluorescent 
     lamps shall be based on the test methods used under the 
     August 9, 2001, version of the Energy Star program of the 
     Environmental Protection Agency and Department of Energy for 
     compact fluorescent lamps. Covered products shall meet all 
     test requirements for regulated parameters in section 
     325(bb). However, covered products may be marketed prior to 
     completion of lamp life and lumen maintenance at 40 percent 
     of rated life testing provided manufacturers document 
     engineering predictions and analysis that support expected 
     attainment of lumen maintenance at 40 percent rated life and 
     lamp life time.
       ``(13) The Secretary shall, not later than 18 months after 
     the date of enactment of this paragraph, prescribe testing 
     requirements for ceiling fans and ceiling fan light kits.''; 
     and
       (2) by adding at the end the following:
       ``(f) Additional Consumer and Commercial Products.--The 
     Secretary shall, not later than 24 months after the date of 
     enactment of this subsection, prescribe testing requirements 
     for suspended ceiling fans, refrigerated bottled or canned 
     beverage vending machines, and commercial refrigerators, 
     freezers, and refrigerator-freezers. Such testing 
     requirements shall be based on existing test procedures used 
     in industry to the extent practical and reasonable. In the 
     case of suspended ceiling fans, such test procedures shall 
     include efficiency at both maximum output and at an output no 
     more than 50 percent of the maximum output.''.
       (c) New Standards.--Section 325 of the Energy Policy and 
     Conservation Act (42 U.S.C. 6295) is amended by adding at the 
     end the following:
       ``(u) Battery Charger and External Power Supply Electric 
     Energy Consumption.--
       ``(1) Initial rulemaking.--(A) The Secretary shall, within 
     18 months after the date of enactment of this subsection, 
     prescribe by notice and comment, definitions and test 
     procedures for the power use of battery chargers and external 
     power supplies. In establishing these test procedures, the 
     Secretary shall consider, among other factors, existing 
     definitions and test procedures used for measuring energy 
     consumption in standby mode and other modes and assess the 
     current and projected future market for battery chargers and 
     external power supplies. This assessment shall include 
     estimates of the significance of potential energy savings 
     from technical improvements to these products and suggested 
     product classes for standards. Prior to the end of this time 
     period, the Secretary shall hold a scoping workshop to 
     discuss and receive comments on plans for developing energy 
     conservation standards for energy use for these products.
       ``(B) The Secretary shall, within 3 years after the date of 
     enactment of this subsection, issue a final rule that 
     determines whether energy conservation standards shall be 
     issued for battery chargers and external power supplies or 
     classes thereof. For each product class, any such standards 
     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) will result in significant overall annual energy 
     savings, considering both standby mode and other operating 
     modes.
       ``(2) Review of standby energy use in covered products.--In 
     determining pursuant to section 323 whether test procedures 
     and energy conservation standards pursuant to this section 
     should be revised, the Secretary shall consider, for covered 
     products that are major sources of standby mode energy 
     consumption, whether to incorporate standby mode into such 
     test procedures and energy conservation standards, taking 
     into account, among other relevant factors, standby mode 
     power consumption compared to overall product energy 
     consumption.
       ``(3) Rulemaking.--The Secretary shall not propose a 
     standard under this section unless the Secretary has issued 
     applicable test procedures for each product pursuant to 
     section 323.
       ``(4) Effective date.--Any standard issued under this 
     subsection shall be applicable to products manufactured or 
     imported 3 years after the date of issuance.
       ``(5) Voluntary programs.--The Secretary and the 
     Administrator shall collaborate and develop programs, 
     including programs pursuant to section 324A (relating to 
     Energy Star Programs) and other voluntary industry agreements 
     or codes of conduct, that are designed to reduce standby mode 
     energy use.
       ``(v) Suspended Ceiling Fans, Vending Machines, and 
     Commercial Refrigerators, Freezers, and Refrigerator-
     Freezers.--The Secretary shall not later than 36 months after 
     the date on which testing requirements are prescribed by the 
     Secretary pursuant to section 323(f), prescribe, by rule, 
     energy conservation standards for suspended ceiling fans, 
     refrigerated bottled or canned beverage vending machines, and 
     commercial refrigerators, freezers, and refrigerator-
     freezers. In establishing standards under this subsection, 
     the Secretary shall use the criteria and procedures contained 
     in subsections (o) and (p). Any standard prescribed under 
     this subsection shall apply to products manufactured 3 years 
     after the date of publication of a final rule establishing 
     such standard.
       ``(w) Illuminated Exit Signs.--Illuminated exit signs 
     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.--Torchieres manufactured on or after 
     January 1, 2006--
       ``(1) shall consume not more than 190 watts of power; and

[[Page 7140]]

       ``(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 low voltage dry-type distribution transformers 
     manufactured on or after January 1, 2006, 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.--Traffic signal modules 
     manufactured on or after January 1, 2006, shall 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 
     shall be installed with compatible, electrically connected 
     signal control interface devices and conflict monitoring 
     systems.
       ``(aa) Unit Heaters.--Unit heaters manufactured on or after 
     the date that is 3 years after the date of enactment of this 
     subsection shall be equipped with an intermittent ignition 
     device and shall have either power venting or an automatic 
     flue damper.
       ``(bb) Medium Base Compact Fluorescent Lamps.--Bare lamp 
     and covered lamp (no reflector) medium base compact 
     fluorescent lamps 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: minimum initial efficacy; lumen maintenance at 1000 
     hours; lumen maintenance at 40 percent of rated life; rapid 
     cycle stress test; and lamp life. 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. The Secretary may, by rule, revise these 
     requirements or establish other requirements considering 
     energy savings, cost effectiveness, and consumer 
     satisfaction.
       ``(cc) Effective Date.--Section 327 shall apply--
       ``(1) to products for which standards are to be established 
     under subsections (u) and (v) on the date on which a final 
     rule is issued by the Department of Energy, except that any 
     State or local standards prescribed or enacted for any such 
     product prior to the date on which such final rule is issued 
     shall not be preempted until the standard established under 
     subsection (u) or (v) for that product takes effect; and
       ``(2) to products for which standards are established under 
     subsections (w) through (bb) on the date of enactment of 
     those subsections, except that any State or local standards 
     prescribed or enacted prior to the date of enactment of those 
     subsections shall not be preempted until the standards 
     established under subsections (w) through (bb) take effect.
       ``(dd) Ceiling Fans.--
       ``(1) Features.--All ceiling fans manufactured on or after 
     January 1, 2006, shall have the following features:
       ``(A) Lighting controls operate independently from fan 
     speed controls.
       ``(B) Adjustable speed controls (either more than 1 speed 
     or variable speed).
       ``(C) The capability of reversible fan action, except for 
     fans sold for industrial applications, outdoor applications, 
     and where safety standards would be violated by the use of 
     the reversible mode. The Secretary may promulgate regulations 
     to define in greater detail the exceptions provided under 
     this subparagraph but may not substantively expand the 
     exceptions.
       ``(2) Revised standards.--
       ``(A) In general.--Notwithstanding any provision of this 
     Act, if the requirements of subsections (o) and (p) are met, 
     the Secretary may consider and prescribe energy efficiency or 
     energy use standards for electricity used by ceiling fans to 
     circulate air in a room.
       ``(B) Special consideration.--If the Secretary sets such 
     standards, the Secretary shall consider--
       ``(i) exempting or setting different standards for certain 
     product classes for which the primary standards are not 
     technically feasible or economically justified; and
       ``(ii) establishing separate exempted product classes for 
     highly decorative fans for which air movement performance is 
     a secondary design feature.
       ``(C) Application.--Any air movement standard prescribed 
     under this subsection shall apply to products manufactured on 
     or after the date that is 3 years after the date of 
     publication of a final rule establishing the standard.''.
       (d) Residential Furnace Fans.--Section 325(f)(3) of the 
     Energy Policy and Conservation Act (42 U.S.C. 6295(f)(3)) is 
     amended by adding the following new subparagraph at the end:
       ``(D) Notwithstanding any provision of this Act, the 
     Secretary may consider, and prescribe, if the requirements of 
     subsection (o) of this section are met, energy efficiency or 
     energy use standards for electricity used for purposes of 
     circulating air through duct work.''.

     SEC. 134. 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) Not later than 3 months after the date of enactment 
     of this subparagraph, the Commission shall initiate a 
     rulemaking to consider the effectiveness of the current 
     consumer products labeling program in assisting consumers in 
     making purchasing decisions and improving energy efficiency 
     and to consider changes to the labeling rules that would 
     improve the effectiveness of consumer product labels. Such 
     rulemaking shall be completed not later than 2 years after 
     the date of enactment of this subparagraph.
       ``(G)(i) Not later than 18 months after date of enactment 
     of this subparagraph, the Commission shall prescribe by rule, 
     pursuant to this section, labeling requirements for the 
     electricity used by ceiling fans to circulate air in a room.
       ``(ii) The rule prescribed 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 
     prescribed.''.
       (b) Rulemaking on Labeling for Additional Products.--
     Section 324(a) of the Energy Policy and Conservation Act (42 
     U.S.C. 6294(a)) is further amended by adding at the end the 
     following:
       ``(5) The Secretary or the Commission, as appropriate, may, 
     for covered products referred to in subsections (u) through 
     (aa) of section 325, prescribe, by rule, pursuant to this 
     section, labeling requirements for such products after a test 
     procedure has been set pursuant to section 323. 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 upon the date of 
     enactment of this paragraph.''.

     SEC. 135. PREEMPTION.

       Section 327 of the Energy Policy and Conservation Act (42 
     U.S.C. 6297) is amended by adding at the end the following:
       ``(h) Ceiling Fans.--Effective on January 1, 2006, this 
     section shall apply to and supersede all State and local 
     standards prescribed or enacted for ceiling fans and ceiling 
     fan light kits.''.

     SEC. 136. STATE CONSUMER PRODUCT ENERGY EFFICIENCY STANDARDS.

       Section 327 of the Energy Policy and Conservation Act (42 
     U.S.C. 6297) is amended by adding at the end the following 
     new subsection:
       ``(h) Limitation on Preemption.--Subsections (a) and (b) 
     shall not apply with respect to State regulation of energy 
     consumption or water use of any covered product during any 
     period of time--
       ``(1) after the date which is 3 years after a Federal 
     standard is required by law to be established or revised, but 
     has not been established or revised; and
       ``(2) before the date on which such Federal standard is 
     established or revised.''.

                       Subtitle D--Public Housing

     SEC. 141. CAPACITY BUILDING FOR ENERGY-EFFICIENT, AFFORDABLE 
                   HOUSING.

       Section 4(b) of the HUD Demonstration Act of 1993 (42 
     U.S.C. 9816 note) is amended--
       (1) in paragraph (1), by inserting before the semicolon at 
     the end the following: ``, including capabilities regarding 
     the provision of energy efficient, affordable housing and 
     residential energy conservation measures''; and
       (2) in paragraph (2), by inserting before the semicolon the 
     following: ``, including such activities relating to the 
     provision of energy efficient, affordable housing and 
     residential energy conservation measures that benefit low-
     income families''.

     SEC. 142. INCREASE OF CDBG PUBLIC SERVICES CAP FOR ENERGY 
                   CONSERVATION AND EFFICIENCY ACTIVITIES.

       Section 105(a)(8) of the Housing and Community Development 
     Act of 1974 (42 U.S.C. 5305(a)(8)) is amended--
       (1) by inserting ``or efficiency'' after ``energy 
     conservation'';
       (2) by striking ``, and except that'' and inserting ``; 
     except that''; and
       (3) by inserting before the semicolon at the end the 
     following: ``; and except that each percentage limitation 
     under this paragraph on the amount of assistance provided 
     under this title that may be used for the provision of public 
     services is hereby increased by 10 percent, but such 
     percentage increase may be used only for the provision of 
     public services concerning energy conservation or 
     efficiency''.

     SEC. 143. FHA MORTGAGE INSURANCE INCENTIVES FOR ENERGY 
                   EFFICIENT HOUSING.

       (a) Single Family Housing Mortgage Insurance.--Section 
     203(b)(2) of the National Housing Act (12 U.S.C. 1709(b)(2)) 
     is amended, in the first undesignated paragraph beginning 
     after subparagraph (B)(ii)(IV) (relating to solar energy 
     systems), by striking ``20 percent'' and inserting ``30 
     percent''.
       (b) Multifamily Housing Mortgage Insurance.--Section 207(c) 
     of the National

[[Page 7141]]

     Housing Act (12 U.S.C. 1713(c)) is amended, in the last 
     undesignated paragraph beginning after paragraph (3) 
     (relating to solar energy systems and residential energy 
     conservation measures), by striking ``20 percent'' and 
     inserting ``30 percent''.
       (c) Cooperative Housing Mortgage Insurance.--Section 213(p) 
     of the National Housing Act (12 U.S.C. 1715e(p)) is amended 
     by striking ``20 per centum'' and inserting ``30 percent''.
       (d) Rehabilitation and Neighborhood Conservation Housing 
     Mortgage Insurance.--Section 220(d)(3)(B)(iii)(IV) of the 
     National Housing Act (12 U.S.C. 1715k(d)(3)(B)(iii)(IV)) is 
     amended--
       (1) by striking ``with respect to rehabilitation projects 
     involving not more than five family units,''; and
       (2) by striking ``20 per centum'' and inserting ``30 
     percent''.
       (e) Low-Income Multifamily Housing Mortgage Insurance.--
     Section 221(k) of the National Housing Act (12 U.S.C. 
     1715l(k)) is amended by striking ``20 per centum'' and 
     inserting ``30 percent''.
       (f) Elderly Housing Mortgage Insurance.--Section 
     231(c)(2)(C) of the National Housing Act (12 U.S.C. 
     1715v(c)(2)(C)) is amended by striking ``20 per centum'' and 
     inserting ``30 percent''.
       (g) Condominium Housing Mortgage Insurance.--Section 234(j) 
     of the National Housing Act (12 U.S.C. 1715y(j)) is amended 
     by striking ``20 per centum'' and inserting ``30 percent''.

     SEC. 144. 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. 145. GRANTS FOR ENERGY-CONSERVING IMPROVEMENTS FOR 
                   ASSISTED HOUSING.

       Section 251(b)(1) of the National Energy Conservation 
     Policy Act (42 U.S.C. 8231(1)) is amended--
       (1) by striking ``financed with loans'' and inserting 
     ``assisted'';
       (2) by inserting after ``1959,'' the following: ``which are 
     eligible multifamily housing projects (as such term is 
     defined in section 512 of the Multifamily Assisted Housing 
     Reform and Affordability Act of 1997 (42 U.S.C. 1437f note)) 
     and are subject to mortgage restructuring and rental 
     assistance sufficiency plans under such Act,''; and
       (3) by inserting after the period at the end of the first 
     sentence the following new sentence: ``Such improvements may 
     also include the installation of energy and water conserving 
     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.''.

     SEC. 147. 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 (as amended by this title), unless the purchase of 
     energy-efficient appliances is not cost-effective to the 
     agency.

     SEC. 148. 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'';
       (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 striking ``Council of American'' 
     and all that follows through ``90.1-1989')'' and inserting 
     ``2003 International Energy Conservation Code'';
       (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 striking ``CABO'' and all that follows through 
     ``1989'' and inserting ``the 2003 International Energy 
     Conservation Code''; and
       (3) in subsection (c)--
       (A) in the heading, by striking ``Model Energy Code'' and 
     inserting ``The International Energy Conservation Code''; and
       (B) by striking ``CABO'' and all that follows through 
     ``1989'' and inserting ``the 2003 International Energy 
     Conservation Code''.

     SEC. 149. 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 of Energy shall review the available assessments of 
     renewable energy resources within the United States, 
     including solar, wind, biomass, ocean (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 of Energy $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 by 
     striking ``and which satisfies'' and all that follows through 
     ``Secretary shall establish.'' and inserting ``. If there are 
     insufficient appropriations to make full payments for 
     electric production from all qualified renewable energy 
     facilities in any given year, the Secretary shall assign 60 
     percent of appropriated funds for that year to facilities 
     that use solar, wind, geothermal, or closed-loop (dedicated 
     energy crops) biomass technologies to generate electricity, 
     and assign the remaining 40 percent to other projects. The 
     Secretary may, after transmitting to Congress an explanation 
     of the reasons therefor, alter the percentage requirements of 
     the preceding sentence.''.
       (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-

[[Page 7142]]

     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, or an Indian tribal government or subdivision 
     thereof,''; and
       (2) by inserting ``landfill gas, livestock methane, ocean 
     (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 ``after October 1, 2005, and 
     before October 1, 2015''.
       (d) Amount of Payment.--Section 1212(e)(1) of the Energy 
     Policy Act of 1992 (42 U.S.C. 13317(e)(1)) is amended by 
     inserting ``landfill gas, livestock methane, ocean (tidal, 
     wave, current, and thermal),'' after ``wind, biomass,''.
       (e) Sunset.--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, 2025''.
       (f) Authorization of Appropriations.--Section 1212(g) of 
     the Energy Policy Act of 1992 (42 U.S.C. 13317(g)) is amended 
     to read as follows:
       ``(g) Authorization of Appropriations.--
       ``(1) In general.--Subject to paragraph (2), there are 
     authorized to be appropriated such sums as may be necessary 
     to carry out this section for fiscal years 2005 through 2025.
       ``(2) Availability of funds.--Funds made available under 
     paragraph (1) shall remain available until expended.''.

     SEC. 203. FEDERAL PURCHASE REQUIREMENT.

       (a) Requirement.--The President, acting through the 
     Secretary of Energy, 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 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 (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 of Energy shall provide a 
     report to Congress on the progress of the Federal Government 
     in meeting the goals established by this section.

     SEC. 204. 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) Not later than December 31, 2006, the Secretary of 
     the Interior shall submit to Congress 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 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 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 
     $5,000,000 for each fiscal year beginning after the date of 
     the enactment of this paragraph.''.

     SEC. 205. USE OF PHOTOVOLTAIC ENERGY IN PUBLIC BUILDINGS.

       (a) In General.--Part 4 of title V of the National Energy 
     Conservation Policy Act (42 U.S.C. 8271 et seq.) is amended 
     by adding at the end the following:

     ``SEC. 570. USE OF PHOTOVOLTAIC ENERGY IN PUBLIC BUILDINGS.

       ``(a) Photovoltaic Energy Commercialization Program.--
       ``(1) In general.--The Secretary 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.

[[Page 7143]]

       ``(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 Secretary 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 Secretary 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 Secretary 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. 206. GRANTS TO IMPROVE THE COMMERCIAL VALUE OF FOREST 
                   BIOMASS FOR ELECTRIC ENERGY, USEFUL HEAT, 
                   TRANSPORTATION FUELS, PETROLEUM-BASED PRODUCT 
                   SUBSTITUTES, AND OTHER COMMERCIAL PURPOSES.

       (a) Findings.--Congress finds the following:
       (1) Thousands of communities in the United States, many 
     located near Federal lands, are at risk to wildfire. 
     Approximately 190,000,000 acres of land managed by the 
     Secretary of Agriculture and the Secretary of the Interior 
     are at risk of catastrophic fire in the near future. The 
     accumulation of heavy forest fuel loads continues to increase 
     as a result of disease, insect infestations, and drought, 
     further raising the risk of fire each year.
       (2) In addition, more than 70,000,000 acres across all land 
     ownerships are at risk to higher than normal mortality over 
     the next 15 years from insect infestation and disease. High 
     levels of tree mortality from insects and disease result in 
     increased fire risk, loss of old growth, degraded watershed 
     conditions, and changes in species diversity and 
     productivity, as well as diminished fish and wildlife habitat 
     and decreased timber values.
       (3) Preventive treatments such as removing fuel loading, 
     ladder fuels, and hazard trees, planting proper species mix 
     and restoring and protecting early successional habitat, and 
     other specific restoration treatments designed to reduce the 
     susceptibility of forest land, woodland, and rangeland to 
     insect outbreaks, disease, and catastrophic fire present the 
     greatest opportunity for long-term forest health by creating 
     a mosaic of species-mix and age distribution. Such prevention 
     treatments are widely acknowledged to be more successful and 
     cost effective than suppression treatments in the case of 
     insects, disease, and fire.
       (4) The byproducts of preventive treatment (wood, brush, 
     thinnings, chips, slash, and other hazardous fuels) removed 
     from forest lands, woodlands and rangelands represent an 
     abundant supply of biomass for biomass-to-energy facilities 
     and raw material for business. There are currently few 
     markets for the extraordinary volumes of byproducts being 
     generated as a result of the necessary large-scale preventive 
     treatment activities.
       (5) The United States should--
       (A) promote economic and entrepreneurial opportunities in 
     using byproducts removed through preventive treatment 
     activities related to hazardous fuels reduction, disease, and 
     insect infestation; and
       (B) develop and expand markets for traditionally underused 
     wood and biomass as an outlet for byproducts of preventive 
     treatment activities.
       (b) Definitions.--In this section:
       (1) Biomass.--The term ``biomass'' means trees and woody 
     plants, including limbs, tops, needles, and other woody 
     parts, and byproducts of preventive treatment, such as wood, 
     brush, thinnings, chips, and slash, that are removed--
       (A) to reduce hazardous fuels; or
       (B) to reduce the risk of or to contain disease or insect 
     infestation.
       (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) 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, micro-business, or a corporation that 
     is incorporated in the United States; and
       (E) a nonprofit organization.
       (4) Preferred community.--The term ``preferred community'' 
     means--
       (A) 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 
     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
       (B) 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 
     land, the condition of which is at significant risk of 
     catastrophic wildfire, disease, or insect infestation or 
     which suffers from disease or insect infestation.
       (5) Secretary concerned.--The term ``Secretary concerned'' 
     means--
       (A) the Secretary of Agriculture with respect to National 
     Forest System lands; and
       (B) the Secretary of the Interior with respect to Federal 
     lands under the jurisdiction of the Secretary of the Interior 
     and Indian lands.
       (c) Biomass Commercial Use Grant Program.--
       (1) In general.--The Secretary concerned may make grants to 
     any person that owns or operates a facility that uses biomass 
     as a raw material to produce electric energy, sensible heat, 
     transportation fuels, or substitutes for petroleum-based 
     products 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.
       (d) 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 the anticipated public benefits of the 
     project, including the potential to develop thermal or 
     electric energy resources or affordable energy, opportunities 
     for the creation or expansion of small businesses and micro-
     businesses, and the potential for new job creation.
       (3) Grant amount.--A grant under this subsection may not 
     exceed $500,000.
       (e) 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.
       (f) Report.--Not later than October 1, 2012, 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

[[Page 7144]]

     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 the 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. 207. 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. 208. 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) Definition of Biomass.--Section 203(2) of the Biomass 
     Energy and Alcohol Fuels Act of 1980 (42 U.S.C. 8802(2)) is 
     amended to read as follows:
       ``(2) 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.''.
       (d) Rebate Program.--
       (1) Establishment.--The Secretary of Energy 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 of Energy 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.
       (e) Renewable Fuel Inventory.--Not later than 180 days 
     after the date of enactment of this Act, the Secretary of 
     Energy 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

                       Subtitle C--Hydroelectric

                     PART I--ALTERNATIVE CONDITIONS

     SEC. 231. 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 shall be entitled to a determination on the record, 
     after opportunity for an expedited agency trial-type hearing 
     of any disputed issues of material fact, with respect to such 
     conditions. Such hearing may be conducted in accordance with 
     procedures established by agency regulation 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 shall be entitled to a 
     determination on the record, after opportunity for an 
     expedited agency trial-type hearing of any disputed issues of 
     material fact, with respect to such fishways. Such hearing 
     may be conducted in accordance with procedures established by 
     agency regulation 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 license applicant 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 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--
       ``(i) cost less to implement; or
       ``(ii) result in improved operation of the project works 
     for electricity production,
     as compared to the condition initially deemed necessary by 
     the Secretary.
       ``(3) The Secretary 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

[[Page 7145]]

     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.
       ``(4) Nothing in this section shall prohibit other 
     interested parties from proposing alternative conditions.
       ``(5) If the Secretary does not accept an applicant's 
     alternative condition under this section, and the Commission 
     finds that the Secretary's 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 provide for the 
     adequate protection and utilization of 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 licensee 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 licensee 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--
       ``(i) cost less to implement; or
       ``(ii) result in improved operation of the project works 
     for electricity production,
     as compared to the fishway initially deemed necessary by the 
     Secretary.
       ``(3) 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 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.
       ``(4) Nothing in this section shall prohibit other 
     interested parties from proposing alternative prescriptions.
       ``(5) If the Secretary concerned does not accept an 
     applicant's alternative prescription under this section, and 
     the Commission finds that the Secretary's 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 be less protective than the fishway initially prescribed 
     by the Secretary. The Secretary shall submit the advisory and 
     the Secretary's final written determination into the record 
     of the Commission's proceeding.''.

                     PART II--ADDITIONAL HYDROPOWER

     SEC. 241. HYDROELECTRIC PRODUCTION INCENTIVES.

       (a) Incentive Payments.--For electric energy generated and 
     sold by a qualified hydroelectric facility during the 
     incentive period, the Secretary of Energy (referred to in 
     this section as 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. 242. HYDROELECTRIC EFFICIENCY IMPROVEMENT.

       (a) Incentive Payments.--The Secretary of Energy 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. 243. 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 ``March 4, 2003''.

     SEC. 244. INCREASED HYDROELECTRIC GENERATION AT EXISTING 
                   FEDERAL FACILITIES.

       (a) In General.--The Secretary of the Interior and the 
     Secretary of Energy, in consultation with 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

[[Page 7146]]

     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, 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. 245. SHIFT OF PROJECT LOADS TO OFF-PEAK PERIODS.

       (a) In General.--The Secretary of the Interior shall--
       (1) review electric power consumption by Bureau of 
     Reclamation facilities for water pumping purposes; and
       (2) make such adjustments in such pumping as possible to 
     minimize the amount of electric power consumed for such 
     pumping during periods of peak electric power consumption, 
     including by performing as much of such pumping as possible 
     during off-peak hours at night.
       (b) Consent of Affected Irrigation Customers Required.--The 
     Secretary may not under this section make any adjustment in 
     pumping at a facility without the consent of each person that 
     has contracted with the United States for delivery of water 
     from the facility for use for irrigation and that would be 
     affected by such adjustment.
       (c) Existing Obligations not Affected.--This section shall 
     not be construed to affect any existing obligation of the 
     Secretary to provide electric power, water, or other benefits 
     from Bureau of Reclamation facilities, including recreational 
     releases.

                    TITLE III--OIL AND GAS--COMMERCE

           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. 6211 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 may be 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; relating to the 
     expiration of title I of the Act).
       (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); relating 
     to the expiration of summer fill and fuel budgeting 
     programs); and
       (3) by striking part D (42 U.S.C. 6285; relating to the 
     expiration of title II of the Act).
       (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. 6250(b)(1)) is amended by striking all after 
     ``increases'' through to ``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.--The 
     Secretary of Energy shall, as expeditiously as practicable, 
     acquire petroleum in amounts 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)), consistent with the 
     provisions of sections 159 and 160 of such Act (42 U.S.C. 
     6239, 6240).

     SEC. 302. NATIONAL OILHEAT RESEARCH ALLIANCE.

       Section 713 of the Energy Act of 2000 (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 of Energy 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.

     SEC. 304. SUSPENSION OF STRATEGIC PETROLEUM RESERVE 
                   DELIVERIES.

       The Secretary of Energy shall suspend deliveries of 
     royalty-in-kind oil to the Strategic Petroleum Reserve until 
     the price of oil falls below $40 per barrel for 2 consecutive 
     weeks on the New York Mercantile Exchange.

                   Subtitle B--Production Incentives

     SEC. 320. LIQUEFACTION OR GASIFICATION NATURAL GAS TERMINALS.

       (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) `Liquefaction or gasification natural gas terminal' 
     includes all 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 tanker, but does not 
     include--
       ``(A) waterborne tankers 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 Construction, Expansion, or Operation 
     of Liquefaction or Gasification Natural Gas Terminals.--(1) 
     The title for section 3 of the Natural Gas Act (15 U.S.C. 
     717b) is amended by inserting ``; liquefaction or 
     gasification natural gas 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) Authorization for Construction, Expansion, or 
     Operation of Liquefaction or Gasification Natural Gas 
     Terminals.--
       ``(1) Commission authorization required.--No person shall 
     construct, expand, or operate a liquefaction or gasification 
     natural gas terminal without an order from the Commission 
     authorizing such person to do so.
       ``(2) Authorization procedures.--
       ``(A) Notice and hearing.--Upon the filing of any 
     application to construct, expand, or operate a liquefaction 
     or gasification natural gas terminal, the Commission shall--
       ``(i) set the matter for hearing;
       ``(ii) give reasonable notice of the hearing to all 
     interested persons, including the State commission of the 
     State in which the liquefaction or gasification natural gas 
     terminal is located;
       ``(iii) decide the matter in accordance with this 
     subsection; and
       ``(iv) issue or deny the appropriate order accordingly.
       ``(B) Designation as lead agency.--
       ``(i) 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

[[Page 7147]]

     the National Environmental Policy Act of 1969 (42 U.S.C. 4312 
     et seq.) for a liquefaction or gasification natural gas 
     terminal.
       ``(ii) Other agencies.--Each Federal agency considering an 
     aspect of the construction, expansion, or operation of a 
     liquefaction or gasification natural gas terminal shall 
     cooperate with the Commission and comply with the deadlines 
     established by the Commission.
       ``(C) Schedule.--
       ``(i) Commission authority to set schedule.--The Commission 
     shall establish a schedule for all Federal and State 
     administrative proceedings required under authority of 
     Federal law to construct, expand, or operate a liquefaction 
     or gasification natural gas terminal. In establishing the 
     schedule, the Commission shall--

       ``(I) ensure expeditious completion of all such 
     proceedings; and
       ``(II) accommodate the applicable schedules established by 
     Federal law for such proceedings.

       ``(ii) Failure to meet schedule.--If a Federal or State 
     administrative agency does not complete a proceeding for an 
     approval that is required before a person may construct, 
     expand, or operate the liquefaction or gasification natural 
     gas terminal, in accordance with the schedule established by 
     the Commission under this subparagraph, and if--

       ``(I) a determination has been made by the Court pursuant 
     to section 19(d) that such delay is unreasonable; and
       ``(II) the agency has failed to act on any remand by the 
     Court within the deadline set by the Court,

     that approval may be conclusively presumed by the Commission.
       ``(D) Exclusive 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 the construction, 
     expansion, or operation of a liquefaction or gasification 
     natural gas terminal. Such record shall be the exclusive 
     record for any Federal administrative proceeding that is an 
     appeal or review of any such decision made or action taken.
       ``(E) State and local safety considerations.--
       ``(i) In general.--The Commission shall consult with the 
     State commission of the State in which the liquefaction or 
     gasification natural gas terminal is located regarding State 
     and local safety considerations prior to issuing an order 
     pursuant to this subsection and consistent with the schedule 
     established under subparagraph (C).
       ``(ii) State safety inspections.--The State commission of 
     the State in which a liquefaction or gasification natural gas 
     terminal is located may, after the terminal is operational, 
     conduct safety inspections with respect to the liquefaction 
     or gasification natural gas terminal if--

       ``(I) the State commission provides written notice to the 
     Commission of its intention to do so; and
       ``(II) the inspections will be carried out in conformance 
     with Federal regulations and guidelines.

     Enforcement of any safety violation discovered by a State 
     commission pursuant to this clause shall be carried out by 
     Federal officials. The Commission shall take appropriate 
     action in response to a report of a violation not later that 
     90 days after receiving such report.
       ``(iii) State and local safety considerations.--For the 
     purposes of this subparagraph, State and local safety 
     considerations include--

       ``(I) the kind and use of the facility;
       ``(II) the existing and projected population and 
     demographic characteristics of the location;
       ``(III) the existing and proposed land use near the 
     location;
       ``(IV) the natural and physical aspects of the location;
       ``(V) the medical, law enforcement, and fire prevention 
     capabilities near the location that can respond at the 
     facility; and
       ``(VI) the feasibility of remote siting.

       ``(F) Limitation.--Subparagraph (C)(ii) shall not apply to 
     any approval required to protect navigation, maritime safety, 
     or maritime security.
       ``(3) Issuance of commission order.--
       ``(A) In general.--The Commission shall issue an order 
     authorizing, in whole or in part, the construction, 
     expansion, or operation covered by the application to any 
     qualified applicant--
       ``(i) unless the Commission finds such actions or 
     operations will not be consistent with the public interest; 
     and
       ``(ii) if the Commission has found that the applicant is--

       ``(I) able and willing to carry out the actions and 
     operations proposed; and
       ``(II) willing to conform to the provisions of this Act and 
     any requirements, rules, and regulations of the Commission 
     set forth under this Act.

       ``(B) Terms and conditions.--The Commission may by its 
     order grant an application, in whole or in part, with such 
     modification and upon such terms and conditions as the 
     Commission may find necessary or appropriate.
       ``(C) Limitations on terms and conditions to commission 
     order.--
       ``(i) In general.--Any Commission order issued pursuant to 
     this subsection before January 1, 2011, shall not be 
     conditioned on--

       ``(I) a requirement that the liquefaction or gasification 
     natural gas terminal offer service to persons other than the 
     person, or any affiliate thereof, securing the order; or
       ``(II) any regulation of the liquefaction or gasification 
     natural gas terminal's rates, charges, terms, or conditions 
     of service.

       ``(ii) Inapplicable to terminal exit pipeline.--Clause (i) 
     shall not apply to any pipeline subject to the jurisdiction 
     of the Commission under section 7 exiting a liquefaction or 
     gasification natural gas terminal.
       ``(iii) Expansion of regulated terminal.--An order issued 
     under this paragraph that relates to an expansion of an 
     existing liquefaction or gasification natural gas terminal, 
     where any portion of the existing terminal continues to be 
     subject to Commission regulation of rates, charges, terms, or 
     conditions of service, may not result in--

       ``(I) subsidization of the expansion by regulated terminal 
     users;
       ``(II) degradation of service to the regulated terminal 
     users; or
       ``(III) undue discrimination against the regulated terminal 
     users.

       ``(iv) Expiration.--This subparagraph shall cease to have 
     effect on January 1, 2021.
       ``(4) Definition.--For the purposes of this subsection, the 
     term `Federal authorization' means any authorization required 
     under Federal law in order to construct, expand, or operate a 
     liquefaction or gasification natural gas terminal, including 
     such permits, special use authorizations, certifications, 
     opinions, or other approvals as may be required, whether 
     issued by a Federal or State agency.''.
       (d) 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 District of Columbia Circuit shall have original and 
     exclusive jurisdiction over any civil action--
       ``(A) for review of any order, action, or failure to act of 
     any Federal or State administrative agency to issue, 
     condition, or deny any permit, license, concurrence, or 
     approval required under Federal law for the construction, 
     expansion, or operation of a liquefaction or gasification 
     natural gas terminal;
       ``(B) alleging unreasonable delay, in meeting a schedule 
     established under section 3(d)(2)(C) or otherwise, by any 
     Federal or State administrative agency in entering an order 
     or taking other action described in subparagraph (A); or
       ``(C) challenging any decision made or action taken by the 
     Commission under section 3(d).
       ``(2) Commission action.--For any action described in this 
     subsection, the Commission shall file with the Court the 
     consolidated record maintained under section 3(d)(2)(D).
       ``(3) Court action.--If the Court finds under paragraph 
     (1)(A) or (B) that an order, action, failure to act, or delay 
     is inconsistent with applicable Federal law, and would 
     prevent the construction, expansion, or operation of a 
     liquefaction or gasification natural gas terminal, the order 
     or action shall be deemed to have been issued or taken, 
     subject to any conditions established by the Federal or State 
     administrative agency upon remand from the Court, such 
     conditions to be 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 deadline for the 
     agency to act on remand.
       ``(4) Unreasonable delay.--For the purposes of paragraph 
     (1)(B), the failure of an agency to issue a permit, license, 
     concurrence, or approval within the later of--
       ``(A) 1 year after the date of filing of an application for 
     the permit, license, concurrence, or approval; or
       ``(B) 60 days after the date of issuance of the order under 
     section 3(d),
     shall be considered unreasonable delay unless the Court, for 
     good cause shown, determines otherwise.
       ``(5) Expedited review.--The Court shall set any action 
     brought under this subsection for expedited consideration.''.

     SEC. 327. 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 pursuant to hydraulic fracturing operations related to 
     oil or gas production activities.''.

     SEC. 328. 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

[[Page 7148]]

     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.''.

     SEC. 329. 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) Deepwater Projects.--Section 6 of the Deepwater Port 
     Act of 1974 (33 U.S.C. 1505) is amended by adding at the end 
     the following:
       ``(d) Reliance on Activities of Other Agencies.--In 
     fulfilling the requirements of section 5(f)--
       ``(1) to the extent that other Federal agencies have 
     prepared environmental impact statements, are conducting 
     studies, or are monitoring the affected human, marine, or 
     coastal environment, the Secretary may use the information 
     derived from those activities in lieu of directly conducting 
     such activities; and
       ``(2) the Secretary may use information obtained from any 
     State or local government or from any person.''.
       (c) Natural Gas Defined.--Section 3(13) of the Deepwater 
     Port Act of 1974 (33 U.S.C. 1502(13)) is amended to read as 
     follows:
       ``(13) natural gas means--
       ``(A) natural gas unmixed; or
       ``(B) any mixture of natural or artificial gas, including 
     compressed or liquefied natural gas, natural gas liquids, 
     liquefied petroleum gas, and condensate recovered from 
     natural gas;''.

     SEC. 330. APPEALS RELATING TO PIPELINE CONSTRUCTION OR 
                   OFFSHORE MINERAL DEVELOPMENT PROJECTS.

       (a) Agency of Record, Pipeline Construction Projects.--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 
     Federal authority for an interstate natural gas pipeline 
     construction project, including construction of natural gas 
     storage and liquefied natural gas facilities, shall use as 
     its exclusive record for all purposes the record compiled by 
     the Federal Energy Regulatory Commission pursuant to the 
     Commission's proceeding under sections 3 and 7 of the Natural 
     Gas Act (15 U.S.C. 717b, 717f).
       (b) Sense of Congress.--It is the sense of Congress that 
     all Federal and State agencies with jurisdiction over 
     interstate natural gas pipeline construction activities 
     should coordinate their proceedings within the timeframes 
     established by the Federal Energy Regulatory Commission when 
     the Commission is acting under sections 3 and 7 of the 
     Natural Gas Act (15 U.S.C. 717b, 717f) to determine whether a 
     certificate of public convenience and necessity should be 
     issued for a proposed interstate natural gas pipeline.
       (c) Agency of Record, Offshore Mineral Development 
     Projects.--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 Federal authority for the permitting, 
     approval, or other authorization of energy projects, 
     including projects to explore, develop, or produce mineral 
     resources in or underlying the outer Continental Shelf shall 
     use as its exclusive record for all purposes (except for the 
     filing of pleadings) the record compiled by the relevant 
     Federal permitting agency.

     SEC. 333. NATURAL GAS MARKET TRANSPARENCY.

       The Natural Gas Act (15 U.S.C 717 et seq.) is amended--
       (1) by redesignating section 24 as section 25; and
       (2) by inserting after section 23 the following:

     ``SEC. 24. NATURAL GAS MARKET TRANSPARENCY.

       ``(a) Authorization.--(1) Not later than 180 days after the 
     date of enactment of the Energy Policy Act of 2005, the 
     Federal Energy Regulatory Commission shall issue rules 
     directing all entities subject to the Commission's 
     jurisdiction as provided under this Act to timely report 
     information about the availability and prices of natural gas 
     sold at wholesale in interstate commerce to the Commission 
     and price publishers.
       ``(2) The Commission shall evaluate the data for adequate 
     price transparency and accuracy.
       ``(3) Rules issued under this subsection requiring the 
     reporting of information to the Commission that may become 
     publicly available shall be limited to aggregate data and 
     transaction-specific data that are otherwise required by the 
     Commission to be made public.
       ``(4) In exercising its authority under this section, the 
     Commission shall not--
       ``(A) compete with, or displace from the market place, any 
     price publisher; or
       ``(B) regulate price publishers or impose any requirements 
     on the publication of information.
       ``(b) Timely Enforcement.--No person shall be subject to 
     any penalty under this section with respect to a violation 
     occurring more than 3 years before the date on which the 
     Federal Energy Regulatory Commission seeks to assess a 
     penalty.
       ``(c) Limitation on Commission Authority.--(1) The 
     Commission shall not condition access to interstate pipeline 
     transportation upon the reporting requirements authorized 
     under this section.
       ``(2) Natural gas sales by a producer that are attributable 
     to volumes of natural gas produced by such producer shall not 
     be subject to the rules issued pursuant to this section.
       ``(3) The Commission shall not require natural gas 
     producers, processors, or users who have a de minimis market 
     presence to participate in the reporting requirements 
     provided in this section.''.

                   Subtitle C--Access to Federal Land

     SEC. 344. 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 lands under the jurisdiction of the Secretary of 
     the Interior; and
       (2) National Forest System lands under the jurisdiction of 
     the Secretary of Agriculture.
       (b) Contents.--The memorandum of understanding shall 
     include provisions that--
       (1) establish administrative procedures and lines of 
     authority that ensure timely processing of oil and gas lease 
     applications, surface use plans of operation, and 
     applications for permits to drill, including steps for 
     processing surface use plans and applications for permits to 
     drill consistent with the timelines established by the 
     amendment made by section 348;
       (2) eliminate duplication of effort by providing for 
     coordination of planning and environmental compliance 
     efforts; and
       (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.
       (c) Data Retrieval System.--
       (1) In general.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary of the Interior and the 
     Secretary of Agriculture shall 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.
       (2) Resource mapping.--Not later than 2 years after the 
     date of enactment of this Act, the Secretary of the Interior 
     and the Secretary of Agriculture shall 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. 346. COMPLIANCE WITH EXECUTIVE ORDER 13211; ACTIONS 
                   CONCERNING REGULATIONS THAT SIGNIFICANTLY 
                   AFFECT ENERGY SUPPLY, DISTRIBUTION, OR USE.

       (a) Requirement.--The head of each Federal agency shall 
     require that before the Federal agency takes any action that 
     could have a significant adverse effect on the supply of 
     domestic energy resources from Federal public land, the 
     Federal agency taking the action shall comply with Executive 
     Order No. 13211 (42 U.S.C. 13201 note).
       (b) Guidance.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary of Energy shall publish 
     guidance for purposes of this section describing what 
     constitutes a significant adverse effect on the supply of 
     domestic energy resources under Executive Order No. 13211 (42 
     U.S.C. 13201 note).
       (c) Memorandum of Understanding.--The Secretary of the 
     Interior and the Secretary of Agriculture shall include in 
     the memorandum of understanding under section 344 provisions 
     for implementing subsection (a) of this section.

     SEC. 355. ENCOURAGING GREAT LAKES OIL AND GAS DRILLING BAN.

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

     SEC. 358. 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).

                  Subtitle D--Refining Revitalization

     SEC. 371. SHORT TITLE.

       This subtitle may be cited as the ``United States Refinery 
     Revitalization Act of 2005''.

     SEC. 372. FINDINGS.

       Congress finds the following:

[[Page 7149]]

       (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 use by the American people. Nearly 50 percent of the 
     petroleum in the United States is used for the production of 
     gasoline. Refined petroleum products have a significant 
     impact on interstate commerce.
       (2) United States demand for refined petroleum products 
     currently exceeds the country's petroleum refining capacity 
     to produce such products. By 2025, United States gasoline 
     consumption is projected to rise from 8,900,000 barrels per 
     day to 12,900,000 barrels per day. Diesel fuel and home 
     heating oil are becoming larger components of an increasing 
     demand for refined petroleum supply. With the increase in air 
     travel, jet fuel consumption is projected to be 789,000 
     barrels per day higher in 2025 than today.
       (3) The petroleum refining industry is operating at 95 
     percent of capacity. The United States is currently importing 
     5 percent of its refined petroleum products and because of 
     the stringent United States gasoline and diesel fuel 
     specifications, few foreign refiners can produce the clean 
     fuels required in the United States and the number of foreign 
     suppliers that can produce United States quality gasoline is 
     decreasing.
       (4) Refiners are subject to significant environmental and 
     other regulations and face several new Clean Air Act 
     requirements over the next decade. New Clean Air Act 
     requirements will benefit the environment but will also 
     require substantial capital investment and additional 
     government permits.
       (5) No new refinery has been built in the United States 
     since 1976 and many smaller domestic refineries have become 
     idle since the removal of the Domestic Crude Oil Allocation 
     Program and because of regulatory uncertainty and generally 
     low returns on capital employed. Today, the United States has 
     149 refineries, down from 324 in 1981. Restoration of 
     recently idled refineries alone would amount to 483,570 
     barrels a day in additional capacity, or approximately 3.3 
     percent of the total operating capacity.
       (6) Refiners have met growing demand by increasing the use 
     of existing equipment and increasing the efficiency and 
     capacity of existing plants. But refining capacity has begun 
     to lag behind peak summer demand.
       (7) Heavy industry and manufacturing jobs have closed or 
     relocated due to barriers to investment, burdensome 
     regulation, and high costs of operation, among other reasons.
       (8) Because the production and disruption in supply of 
     refined petroleum products has a significant impact on 
     interstate commerce, it serves the national interest to 
     increase the domestic refining operating capacity.
       (10) More regulatory certainty for refinery owners is 
     needed to stimulate investment in increased refinery capacity 
     and required procedures for Federal, State, and local 
     regulatory approvals need to be streamlined to ensure that 
     increased refinery capacity can be developed and operated in 
     a safe, timely, and cost-effective manner.
       (11) The proposed Yuma Arizona Refinery, a grassroots 
     refinery facility, which only recently received its Federal 
     air quality permit after 5 years under the current regulatory 
     process, and is just now beginning its environmental impact 
     statement and local permitting process, serves as an example 
     of the obstacles a refiner would have to overcome to reopen 
     an idle refinery.

     SEC. 373. PURPOSE.

       The purpose of this subtitle is to encourage the expansion 
     of the United States refining capacity by providing an 
     accelerated review and approval process of all regulatory 
     approvals for certain idle refineries and lending 
     corresponding legal and technical assistance to States with 
     resources that may be inadequate to meet such permit review 
     demands.

     SEC. 374. DESIGNATION OF REFINERY REVITALIZATION ZONES.

       Not later than 90 days after the date of enactment of this 
     Act, the Secretary shall designate as a Refinery 
     Revitalization Zone any area--
       (1) that--
       (A) has experienced mass layoffs at manufacturing 
     facilities, as determined by the Secretary of Labor; or
       (B) contains an idle refinery; and
       (2) that has an unemployment rate that exceeds the national 
     average by at least 10 percent of the national average, as 
     set by the Department of Labor, Bureau of Labor Statistics, 
     at the time of the designation as a Refinery Revitalization 
     Zone.

     SEC. 375. MEMORANDUM OF UNDERSTANDING.

       (a) In General.--Not later than 90 days after the date of 
     enactment of this Act, the Secretary shall enter into a 
     memorandum of understanding with the Administrator for the 
     purposes of this subtitle. The Secretary and the 
     Administrator shall each designate a senior official 
     responsible for, and dedicate sufficient other staff and 
     resources to ensure, full implementation of the purposes of 
     this subtitle and any regulations enacted pursuant to this 
     subtitle.
       (b) Additional Signatories.--The Governor of any State, and 
     the appropriate representative of any Indian Tribe, with 
     jurisdiction over a Refinery Revitalization Zone, as 
     designated by the Secretary pursuant to section 374, may be 
     signatories to the memorandum of understanding under this 
     section.

     SEC. 376. STATE ENVIRONMENTAL PERMITTING ASSISTANCE.

       Not later than 30 days after a Revitalization Program 
     Qualifying State becomes a signatory to the memorandum of 
     understanding under section 375(b)--
       (1) the Secretary shall designate one or more employees of 
     the Department with expertise relating to the siting and 
     operation of refineries to provide legal and technical 
     assistance to that Revitalization Program Qualifying State; 
     and
       (2) the Administrator shall designate, to provide legal and 
     technical assistance for that Revitalization Program 
     Qualifying State, one or more employees of the Environmental 
     Protection Agency with expertise on regulatory issues, 
     relating to the siting and operation of refineries, with 
     respect to each of--
       (A) the Clean Air Act (42 U.S.C. 7401 et seq.);
       (B) the Federal Water Pollution Control Act (33 U.S.C. 1251 
     et seq.);
       (C) the Safe Drinking Water Act (42 U.S.C. 300f et seq.);
       (D) the Comprehensive Environmental Response, Compensation, 
     and Liability Act of 1980 (42 U.S.C. 9601 et seq.);
       (E) the Solid Waste Disposal Act (42 U.S.C. 6901 et seq.);
       (F) the Toxic Substances Control Act (15 U.S.C. 2601 et 
     seq.);
       (G) the National Historic Preservation Act (16 U.S.C. 470 
     et seq.); and
       (H) the National Environmental Policy Act of 1969 (42 
     U.S.C. 4321 et seq.).

     SEC. 377. COORDINATION AND EXPEDITIOUS REVIEW OF PERMITTING 
                   PROCESS.

       (a) Department of Energy as Lead Agency.--Upon written 
     request of a prospective applicant for Federal authorization 
     for a refinery facility in a Refinery Revitalization Zone, 
     the Department shall act as the lead Federal agency for the 
     purposes of coordinating all applicable Federal 
     authorizations and environmental reviews of the refining 
     facility. 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 of the refining 
     facility.
       (b) Schedule.--
       (1) In general.--The Secretary, in coordination with the 
     agencies with authority over Federal authorizations and, as 
     appropriate, with Indian Tribes and State and local agencies 
     that are willing to coordinate their separate permitting and 
     environmental reviews with the Federal authorizations and 
     environmental reviews, shall establish a schedule with prompt 
     and binding intermediate and ultimate deadlines for the 
     review of, and Federal authorization decisions relating to, 
     refinery facility siting and operation.
       (2) Preapplication process.--Prior to establishing the 
     schedule, the Secretary shall provide an expeditious 
     preapplication mechanism for applicants to confer with the 
     agencies involved and to have each agency communicate to the 
     prospective applicant within 60 days concerning--
       (A) the likelihood of approval for a potential refinery 
     facility; and
       (B) key issues of concern to the agencies and local 
     community.
       (3) Schedule.--The Secretary shall consider the 
     preapplication findings under paragraph (2) in setting the 
     schedule and shall ensure that once an application has been 
     submitted with such information as the Secretary considers 
     necessary, all permit decisions and related environmental 
     reviews under all applicable Federal laws shall be completed 
     within 6 months or, where circumstances require otherwise, as 
     soon as thereafter practicable.
       (c) Consolidated Environmental Review.--
       (1) Lead agency.--In carrying out its role as the lead 
     Federal agency for environmental review, the Department shall 
     coordinate all applicable Federal actions for complying with 
     the National Environmental Policy Act of 1969 (42 U.S.C. 4321 
     et seq.) and shall be responsible for preparing any 
     environmental impact statement required by section 102(2)(C) 
     of that Act (42 U.S.C. 4332(2)(C)) or such other form of 
     environmental review as is required.
       (2) Consolidation of statements.--In carrying out paragraph 
     (1), if the Department determines an environmental impact 
     statement is required, the Department shall prepare a single 
     environmental impact statement, which shall consolidate the 
     environmental reviews of all Federal agencies considering any 
     aspect of the project covered by the environmental impact 
     statement.
       (d) Other Agencies.--Each Federal agency considering an 
     aspect of the siting or operation of a refinery facility in a 
     Refinery Revitalization Zone shall cooperate with the 
     Department and comply with the deadlines established by the 
     Department in the preparation of any environmental impact 
     statement or such other form of review as is required.
       (e) Exclusive Record.--The Department shall, with the 
     cooperation of Federal and

[[Page 7150]]

     State administrative agencies and officials, maintain a 
     complete consolidated record of all decisions made or actions 
     taken by the Department or by a Federal administrative agency 
     or officer (or State administrative agency or officer acting 
     under delegated Federal authority) with respect to the siting 
     or operation of a refinery facility in a Refinery 
     Revitalization Zone. Such record shall be the exclusive 
     record for any Federal administrative proceeding that is an 
     appeal or review of any such decision made or action taken.
       (f) Appeals.--In the event any agency has denied a Federal 
     authorization required for a refinery facility in a Refinery 
     Revitalization Zone, or has failed to act by a deadline 
     established by the Secretary pursuant to subsection (b) for 
     deciding whether to issue the Federal authorization, the 
     applicant or any State in which the refinery facility would 
     be located may file an appeal with the Secretary. Based on 
     the record maintained under subsection (e), and in 
     consultation with the affected agency, the Secretary may then 
     either issue the necessary Federal authorization with 
     appropriate conditions, or deny the appeal. The Secretary 
     shall issue a decision within 60 days after the filing of the 
     appeal. In making a decision under this subsection, the 
     Secretary shall comply with applicable requirements of 
     Federal law, including each of the laws referred to in 
     section 376(2)(A) through (H). Any judicial appeal of the 
     Secretary's decision shall be to the United States Court of 
     Appeals for the District of Columbia.
       (g) Conforming Regulations.--Not later than 6 months after 
     the date of enactment of this Act, the Secretary shall issue 
     any regulations necessary to implement this subtitle.

     SEC. 378. COMPLIANCE WITH ALL ENVIRONMENTAL REGULATIONS 
                   REQUIRED.

       Nothing in this subtitle shall be construed to waive the 
     applicability of environmental laws and regulations to any 
     refinery facility.

     SEC. 379. DEFINITIONS.

       For the purposes of this subtitle, the term--
       (1) ``Administrator'' means the Administrator of the 
     Environmental Protection Agency;
       (2) ``Department'' means the Department of Energy;
       (3) ``Federal authorization'' means any authorization 
     required under Federal law (including the Clean Air Act, the 
     Federal Water Pollution Control Act, the Safe Drinking Water 
     Act, the Comprehensive Environmental Response, Compensation, 
     and Liability Act of 1980, the Solid Waste Disposal Act, the 
     Toxic Substances Control Act, the National Historic 
     Preservation Act, and the National Environmental Policy Act 
     of 1969) in order to site, construct, upgrade, or operate a 
     refinery facility within a Refinery Revitalization Zone, 
     including such permits, special use authorizations, 
     certifications, opinions, or other approvals as may be 
     required, whether issued by a Federal, State, or local 
     agency;
       (4) ``idle refinery'' means any real property site that has 
     been used at any time for a refinery facility since December 
     31, 1979, that has not been in operation after April 1, 2005;
       (5) ``refinery facility'' means any facility designed and 
     operated to receive, unload, store, process and refine raw 
     crude oil by any chemical or physical process, including 
     distillation, fluid catalytic cracking, hydrocracking, 
     coking, alkylation, etherification, polymerization, catalytic 
     reforming, isomerization, hydrotreating, blending, and any 
     combination thereof;
       (6) ``Revitalization Program Qualifying State'' means a 
     State or Indian Tribe that--
       (A) has entered into the memorandum of understanding 
     pursuant to section 375(b); and
       (B) has established a refining infrastructure coordination 
     office that the Secretary finds will facilitate Federal-State 
     cooperation for the purposes of this subtitle; and
       (7) ``Secretary'' means the Secretary of Energy.

                             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 of Energy (referred to in 
     this title as 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 10-year 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 General Accounting 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.--The Secretary shall not provide funding 
     under this subtitle for any project that does not 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 60 percent of the funds are used only for projects on 
     coal-based gasification technologies, including gasification 
     combined cycle, gasification fuel cells, gasification 
     coproduction, and hybrid gasification/combustion.
       (B) Technical milestones.--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. The technical milestones shall become more 
     restrictive during the life of the program. The Secretary 
     shall set the periodic milestones so as to achieve by 2020 
     coal gasification projects able--
       (i) to remove 99 percent of sulfur dioxide;
       (ii) to emit not more than .05 lbs of NOx per 
     million Btu;
       (iii) to achieve substantial reductions in mercury 
     emissions; and
       (iv) to achieve a thermal efficiency of--

       (I) 60 percent for coal of more than 9,000 Btu;
       (II) 59 percent for coal of 7,000 to 9,000 Btu; and
       (III) 50 percent for coal of less than 7,000 Btu.

       (2) Other projects.--The Secretary shall periodically set 
     technical milestones and ensure that up to 40 percent of the 
     funds appropriated pursuant to section 401(a) are used for 
     projects not described in paragraph (1). The milestones shall 
     specify the emission and thermal efficiency levels that 
     projects funded under this paragraph shall be designed to and 
     reasonably expected to achieve. The technical milestones 
     shall become more restrictive during the life of the program. 
     The Secretary shall set the periodic milestones so as to 
     achieve by 2010 projects able--
       (A) to remove 97 percent of sulfur dioxide;
       (B) to emit no more than .08 lbs of NOx per 
     million Btu;
       (C) to achieve substantial reductions in mercury emissions; 
     and
       (D) to achieve a thermal efficiency of--
       (i) 45 percent for coal of more than 9,000 Btu;
       (ii) 44 percent for coal of 7,000 to 9,000 Btu; and
       (iii) 40 percent for coal of less than 7,000 Btu.
       (3) Consultation.--Before setting the technical milestones 
     under paragraphs (1)(B) and (2), the Secretary shall consult 
     with the Administrator of the Environmental Protection Agency 
     and interested entities, including coal producers, industries 
     using coal, organizations to promote coal or advanced coal 
     technologies, environmental organizations, and organizations 
     representing workers.
       (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 set forth in paragraph 
     (1)(B)(iv) and (2)(D), 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) Permitted uses.--In carrying out this subtitle, the 
     Secretary may fund projects that include, as part of the 
     project, the separation and capture of carbon dioxide. The 
     thermal efficiency goals of paragraphs (1), (2), and (4) 
     shall not apply for projects that separate and capture at 
     least 50 percent of the facility's potential emissions of 
     carbon dioxide.
       (c) Financial Criteria.--The Secretary shall not provide a 
     funding award under this subtitle unless the recipient 
     documents to the satisfaction of the Secretary that--
       (1) the award recipient is financially viable without the 
     receipt of additional Federal funding;
       (2) the recipient will provide sufficient information to 
     the Secretary to enable the Secretary to ensure that the 
     award 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 meet the requirements 
     of subsections (a), (b), and (c) and are likely to--
       (1) achieve overall cost reductions in the utilization of 
     coal to generate useful forms of energy;

[[Page 7151]]

       (2) 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
       (3) 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) Federal Share.--The Federal share of the cost of a coal 
     or related technology project funded by the Secretary under 
     this subtitle shall not exceed 50 percent.
       (f) Applicability.--No technology, or level of emission 
     reduction, shall be treated as 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) solely by reason of 
     the use of such technology, or the achievement of such 
     emission reduction, by 1 or more facilities receiving 
     assistance under this subtitle.

     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.

       As part of the program authorized in section 401, the 
     Secretary shall award competitive, merit-based grants to 
     universities for the establishment of Centers of Excellence 
     for Energy Systems of the Future. The Secretary shall provide 
     grants to universities that show the greatest potential for 
     advancing new clean coal technologies.

                    Subtitle B--Clean Power Projects

     SEC. 411. COAL TECHNOLOGY LOAN.

       There are authorized to be appropriated to the Secretary 
     $125,000,000 to provide a loan to the owner of the 
     experimental plant constructed under United States Department 
     of Energy cooperative agreement number DE-FC-22-91PC90544 on 
     such terms and conditions as the Secretary determines, 
     including interest rates and upfront payments.

     SEC. 412. 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. 414. 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.

                 Subtitle D--Coal and Related Programs

     SEC. 441. CLEAN AIR COAL PROGRAM.

       (a) Amendment.--The Energy Policy Act of 1992 is amended by 
     adding the following new title at the end thereof:

                  ``TITLE XXXI--CLEAN AIR COAL PROGRAM

     ``SEC. 3101. FINDINGS; PURPOSES; DEFINITIONS.

       ``(a) Findings.--The Congress finds that--
       ``(1) new environmental regulations present additional 
     challenges for coal-fired electrical generation in the 
     private marketplace; and
       ``(2) the Department of Energy, in cooperation with 
     industry, has already fully developed and commercialized 
     several new clean-coal technologies that will allow the clean 
     use of coal.
       ``(b) 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, and 
     increase the marketplace acceptance of the new clean coal 
     technologies; and
       ``(3) advance the deployment of pollution control equipment 
     to meet the current and future obligations of coal-fired 
     generation units regulated under the Clean Air Act (42 U.S.C. 
     7402 and following).

     ``SEC. 3102. AUTHORIZATION OF PROGRAM.

       ``The Secretary shall carry out a program to facilitate 
     production and generation of coal-based power and the 
     installation of pollution control equipment.

     ``SEC. 3103. AUTHORIZATION OF APPROPRIATIONS.

       ``(a) Pollution Control Projects.--There are authorized to 
     be appropriated to the Secretary $300,000,000 for fiscal year 
     2006, $100,000,000 for fiscal year 2007, $40,000,000 for 
     fiscal year 2008, $30,000,000 for fiscal year 2009, and 
     $30,000,000 for fiscal year 2010, to remain available until 
     expended, for carrying out the program for pollution control 
     projects, which may include--
       ``(1) pollution control equipment and processes for the 
     control of mercury air emissions;
       ``(2) pollution control equipment and processes for the 
     control of nitrogen dioxide air emissions or sulfur dioxide 
     emissions;
       ``(3) pollution control equipment and processes for the 
     mitigation or collection of more than one pollutant;
       ``(4) advanced combustion technology for the control of at 
     least two pollutants, including mercury, particulate matter, 
     nitrogen oxides, and sulfur dioxide, which may also be 
     designed to improve the energy efficiency of the unit; and
       ``(5) advanced pollution control equipment and processes 
     designed to allow use of the waste byproducts or other 
     byproducts of the equipment or an electrical generation unit 
     designed to allow the use of byproducts.

     Funds appropriated under this subsection which are not 
     awarded before fiscal year 2012 may be applied to projects 
     under subsection (b), in addition to amounts authorized under 
     subsection (b).
       ``(b) Generation Projects.--There are authorized to be 
     appropriated to the Secretary $250,000,000 for fiscal year 
     2007, $350,000,000 for fiscal year 2008, $400,000,000 for 
     fiscal year 2009, $400,000,000 for fiscal year 2010, 
     $400,000,000 for fiscal year 2011, $400,000,000 for fiscal 
     year 2012, and $300,000,000 for fiscal year 2013, to remain 
     available until expended, for generation projects and air 
     pollution control projects. Such projects may include--
       ``(1) coal-based electrical generation equipment and 
     processes, including gasification combined cycle or other 
     coal-based generation equipment and processes;
       ``(2) associated environmental control equipment, that will 
     be cost-effective and that is designed to meet anticipated 
     regulatory requirements;
       ``(3) coal-based electrical generation equipment and 
     processes, including gasification fuel cells, gasification 
     coproduction, and hybrid gasification/combustion projects; 
     and
       ``(4) advanced coal-based electrical generation equipment 
     and processes, including oxidation combustion techniques, 
     ultra-supercritical boilers, and chemical looping, which the 
     Secretary determines will be cost-effective and could 
     substantially contribute to meeting anticipated environmental 
     or energy needs.
       ``(c) Limitation.--Funds placed at risk during any fiscal 
     year for Federal loans or loan guarantees pursuant to this 
     title may not exceed 30 percent of the total funds obligated 
     under this title.

     ``SEC. 3104. AIR POLLUTION CONTROL PROJECT CRITERIA.

       ``The Secretary shall pursuant to authorizations contained 
     in section 3103 provide funding for air pollution control 
     projects designed to facilitate compliance with Federal and 
     State environmental regulations, including any regulation 
     that may be established with respect to mercury.

     ``SEC. 3105. CRITERIA FOR GENERATION PROJECTS.

       ``(a) Criteria.--The Secretary shall establish criteria on 
     which selection of individual projects described in section 
     3103(b) should be based. 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. These 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 that result in the 
     repowering or replacement of older, less efficient units;
       ``(3) documented broad interest in the procurement of the 
     equipment and utilization of the processes used in the 
     projects by electrical generator owners or operators;
       ``(4) equipment and processes beginning in 2006 through 
     2011 that are projected to achieve an 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 
     based 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
       ``(5) equipment and processes beginning in 2012 and 2013 
     that are projected to achieve an 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 
     based on higher heating values; and
       ``(C) 40 percent for coal of less than 7,000 Btu per pound 
     based on higher heating values,

[[Page 7152]]

     except that energy used for coproduction or cogeneration 
     shall not be counted in calculating the thermal efficiency 
     under this paragraph.
       ``(b) Selection.--(1) In selecting the projects, up to 25 
     percent of the projects selected may be either coproduction 
     or cogeneration or other gasification projects, but at least 
     25 percent of the projects shall be for the sole purpose of 
     electrical generation, and priority should be given to 
     equipment and projects less than 600 MW to foster and promote 
     standard designs.
       ``(2) The Secretary shall give priority to projects that 
     have been developed and demonstrated that are not yet cost 
     competitive, and for coal energy generation projects that 
     advance efficiency, environmental performance, or cost 
     competitiveness significantly beyond the level of pollution 
     control equipment that is in operation on a full scale.

     ``SEC. 3106. FINANCIAL CRITERIA.

       ``(a) In General.--The Secretary shall only provide 
     financial assistance to projects that meet the requirements 
     of sections 3103 and 3104 and are likely to--
       ``(1) achieve overall cost reductions in the utilization of 
     coal to generate useful forms of energy; and
       ``(2) improve the competitiveness of coal in order to 
     maintain a diversity of domestic fuel choices in the United 
     States to meet electricity generation requirements.
       ``(b) Conditions.--The Secretary shall not provide a 
     funding award under this title unless--
       ``(1) the award recipient is financially viable without the 
     receipt of additional Federal funding; and
       ``(2) the recipient provides sufficient information to the 
     Secretary for the Secretary to ensure that the award funds 
     are spent efficiently and effectively.
       ``(c) Equal Access.--The Secretary shall, to the extent 
     practical, utilize cooperative agreement, loan guarantee, and 
     direct Federal loan mechanisms designed to ensure that all 
     electrical generation owners have equal access to these 
     technology deployment incentives. The Secretary shall develop 
     and direct a competitive solicitation process for the 
     selection of technologies and projects under this title.

     ``SEC. 3107. FEDERAL SHARE.

       ``The Federal share of the cost of a coal or related 
     technology project funded by the Secretary under this title 
     shall not exceed 50 percent. For purposes of this title, 
     Federal funding includes only appropriated funds.

     ``SEC. 3108. APPLICABILITY.

       ``No technology, or level of emission reduction, shall be 
     treated as adequately demonstrated for purposes of section 
     111 of the Clean Air Act (42 U.S.C. 7411), achievable for 
     purposes of section 169 of the Clean Air Act (42 U.S.C. 
     7479), or achievable in practice for purposes of section 171 
     of the Clean Air Act (42 U.S.C. 7501) solely by reason of the 
     use of such technology, or the achievement of such emission 
     reduction, by one or more facilities receiving assistance 
     under this title.''.
       (b) Table of Contents Amendment.--The table of contents of 
     the Energy Policy Act of 1992 is amended by adding at the end 
     the following:

                  ``TITLE XXXI--CLEAN AIR COAL PROGRAM

``Sec. 3101. Findings; purposes; definitions.
``Sec. 3102. Authorization of program.
``Sec. 3103. Authorization of appropriations.
``Sec. 3104. Air pollution control project criteria.
``Sec. 3105. Criteria for generation projects.
``Sec. 3106. Financial criteria.
``Sec. 3107. Federal share.
``Sec. 3108. Applicability.''.

                         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--
       (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 RESOURCES

     ``SEC. 2601. DEFINITIONS.

       ``For purposes of 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; and
       ``(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.
       ``(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 particular 
     State.
       ``(4) 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), except that the 
     term `Indian tribe', for the purpose of paragraph (11) and 
     sections 2603(b)(3) and 2604, shall 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 `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 authorized by section 2602.
       ``(11) 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 which 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--

[[Page 7153]]

       ``(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; and
       ``(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.
       ``(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;
       ``(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 may develop, in consultation with 
     Indian tribes, a formula for providing grants under this 
     subsection.
       ``(B) In providing a grant under this subsection, the 
     Director shall give priority to an application received from 
     an Indian tribe with inadequate electric service (as 
     determined by the Director).
       ``(4) The Secretary of Energy may issue such regulations as 
     necessary to carry out this subsection.
       ``(5) There are authorized to be appropriated to carry out 
     this subsection such sums as are necessary for each of fiscal 
     years 2006 through 2016.
       ``(c) Department of Energy Loan Guarantee Program.--
       ``(1) Subject to paragraph (3), 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 not 
     more than 90 percent of the unpaid principal and interest due 
     on any loan made to any Indian tribe for energy development.
       ``(2) 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.
       ``(3) The aggregate outstanding amount guaranteed by the 
     Secretary of Energy at any time under this subsection shall 
     not exceed $2,000,000,000.
       ``(4) The Secretary of Energy may issue such regulations as 
     the Secretary of Energy determines are necessary to carry out 
     this subsection.
       ``(5) There are authorized to be appropriated such sums as 
     are necessary to carry out this subsection, to remain 
     available until expended.
       ``(6) Not later than 1 year from the date of enactment of 
     this section, the Secretary of Energy shall report to 
     Congress on the financing requirements of Indian tribes for 
     energy development on Indian land.
       ``(d) Federal Agencies-Indian Energy Preference.--
       ``(1) In purchasing electricity or any other energy product 
     or by-product, 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 by-product; 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) by an Indian tribe for the development of a tribal 
     energy resource inventory or tribal energy resource on Indian 
     land;
       ``(2) by an Indian tribe for the development of a 
     feasibility study or other report necessary to the 
     development of energy resources on Indian land;
       ``(3) by an Indian tribe (other than an Indian Tribe in 
     Alaska except the Metlakatla Indian Community) for the 
     development and enforcement of tribal laws (including 
     regulations) relating to tribal energy resource development 
     and the development of technical infrastructure to protect 
     the environment under applicable law;
       ``(4) by a Native Corporation for the development and 
     implementation of corporate policies and the development of 
     technical infrastructure related to energy development and 
     environmental protection under applicable law; and
       ``(5) 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.--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 upon the request of an Indian 
     tribe, the Indian tribe shall have available scientific and 
     technical information and expertise, for use in the Indian 
     tribe's regulation, development, and management of energy 
     resources on Indian land. The Secretary may fulfill this 
     responsibility either directly, through the use of Federal 
     officials, or indirectly, by providing financial assistance 
     to the 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.--Subject to the 
     provisions of this section--
       ``(1) an Indian tribe may, at its discretion, 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 Indian tribe's energy mineral 
     resources located on tribal land; and
       ``(B) construction or operation of an electric generation, 
     transmission, or distribution facility located on tribal land 
     or a facility to process or refine energy resources developed 
     on tribal land; and
       ``(2) such lease or business agreement described in 
     paragraph (1) shall not require 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 the provisions 
     required by 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 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 Indian tribe's activities under such 
     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 
     pursuant to the provisions of this section shall be valid 
     unless the lease, business agreement, or right-of-way is 
     authorized by the provisions of a tribal energy resource 
     agreement approved by the Secretary under subsection (e)(2).
       ``(e) Tribal Energy Resource Agreements.--
       ``(1) On issuance of regulations under paragraph (8), an 
     Indian tribe may submit to the

[[Page 7154]]

     Secretary for approval a tribal energy resource agreement 
     governing leases, business agreements, and rights-of-way 
     under this section.
       ``(2)(A) Not later than 180 days after the date on which 
     the Secretary receives a tribal energy resource agreement 
     submitted by an Indian tribe under paragraph (1), or not 
     later than 60 days after the Secretary receives a revised 
     tribal energy resource agreement submitted by an Indian tribe 
     under paragraph (4)(C), (or such later date as may be 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;
       ``(VIII) identify final approval authority;
       ``(IX) provide for public notification of final approvals;
       ``(X) establish a process for consultation with any 
     affected States concerning off-reservation impacts, if any, 
     identified pursuant to the provisions required 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, in the event that any of 
     its provisions violates an express term or requirement set 
     forth in the tribal energy resource agreement pursuant to 
     which it was executed--

       ``(aa) such provision shall be null and void; and
       ``(bb) if the Secretary determines such provision to be 
     material, the Secretary shall have the authority to 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 adopted pursuant to this subsection; and
       ``(XIV) include citations to tribal laws, regulations, or 
     procedures, if any, that set out tribal remedies that must be 
     exhausted before a petition may be submitted to the Secretary 
     pursuant to paragraph (7)(B).
       ``(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--
       ``(i) the identification and evaluation of all significant 
     environmental impacts (as compared with a no-action 
     alternative), including effects on cultural resources;
       ``(ii) the identification of proposed mitigation;
       ``(iii) a process for ensuring that the public is informed 
     of and has an opportunity to comment on the environmental 
     impacts of the proposed action before tribal approval of the 
     lease, business agreement, or right-of-way; and
       ``(iv) sufficient administrative support and technical 
     capability to carry out the environmental review process.
       ``(D) A tribal energy resource agreement negotiated between 
     the Secretary and an Indian tribe in accordance with this 
     subsection shall include--
       ``(i) provisions requiring the Secretary to conduct a 
     periodic review and evaluation to monitor the performance of 
     the Indian tribe's activities associated with the development 
     of energy resources under the tribal energy resource 
     agreement; and
       ``(ii) when such review and evaluation result 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 appropriate actions determined by the 
     Secretary to be necessary to protect such asset, which 
     actions may include reassumption of responsibility for 
     activities associated with the development of energy 
     resources on tribal land until the violation and conditions 
     that gave rise to such jeopardy have been corrected.
       ``(E) The periodic review and evaluation described in 
     subparagraph (D) shall be conducted on an annual basis, 
     except that, after the third such 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 required by 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 under the 
     National Environmental Policy Act of 1969 (42 U.S.C. 4321 et 
     seq.) shall be limited to the direct effects of that 
     approval.
       ``(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 set forth in the Secretary's 
     regulations adopted pursuant to 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 Indian 
     tribe's rights under, the lease, business agreement, or 
     right-of-way.
       ``(6)(A) For purposes of the activities to be undertaken by 
     the Secretary pursuant to this section, the Secretary shall--
       ``(i) carry out such activities in a manner consistent 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 have a trust 
     obligation to ensure that the rights and interests of an 
     Indian tribe are protected in the event that--
       ``(i) any other party to any such lease, business 
     agreement, or right-of-way violates any applicable provision 
     of Federal law or the terms of any lease, business agreement, 
     or right-of-way under this section; or
       ``(ii) any provision in such lease, business agreement, or 
     right-of-way violates any express provision or requirement 
     set forth in the tribal energy resource agreement pursuant to 
     which the lease, business agreement, or right-of-way was 
     executed.
       ``(D) Notwithstanding subparagraph (B), the United States 
     shall not be liable to any party (including any Indian tribe) 
     for any of the negotiated terms of, or any losses 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). For the purpose of this subparagraph, 
     the term `negotiated terms' means any terms or provisions 
     that are negotiated by an Indian tribe and any other party or 
     parties to a lease, business agreement, or right-of-way 
     entered into pursuant to an approved tribal energy resource 
     agreement.
       ``(7)(A) In this paragraph, the term `interested party' 
     means any person or entity the interests of which have 
     sustained or will sustain a significant 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 tribal remedies, and in 
     accordance with the process and requirements set forth in 
     regulations adopted by the Secretary pursuant to paragraph 
     (8),

[[Page 7155]]

     an interested party may submit to the Secretary a petition to 
     review compliance of 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 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, as 
     alleged in the petition.
       ``(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 (D), if the Secretary 
     determines that the Indian tribe is not in compliance with 
     the tribal energy resource agreement as alleged in the 
     petition, the Secretary shall take such action as is 
     necessary to ensure compliance with the provisions of the 
     tribal energy resource agreement, which action may include--
       ``(I) temporarily suspending some or all activities under a 
     lease, business agreement, or right-of-way under this section 
     until the Indian tribe or such activities are in compliance 
     with the provisions of the approved tribal energy resource 
     agreement; or
       ``(II) rescinding approval of all or part of the tribal 
     energy resource agreement, and if all of such agreement is 
     rescinded, reassuming the responsibility for approval of any 
     future leases, business agreements, or rights-of-way 
     described in subsections (a) and (b).
       ``(D) Prior to seeking to ensure compliance with the 
     provisions of the tribal energy resource agreement of an 
     Indian tribe under subparagraph (C)(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
       ``(iii) before taking any action described in subparagraph 
     (C)(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.
       ``(E) An Indian tribe described in subparagraph (D) shall 
     retain all rights to appeal as provided in regulations issued 
     by the Secretary.
       ``(8) Not later than 1 year after the date of enactment of 
     the Indian Tribal Energy Development and Self-Determination 
     Act of 2005, the Secretary shall issue regulations that 
     implement the provisions of this subsection, including--
       ``(A) criteria to be used in determining the capacity of an 
     Indian tribe described in 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 leases, business agreements, and rights-
     of-way described in this subsection;
       ``(C) provisions setting forth 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 defining 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 environment 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.) and the National Environmental Policy Act of 1969 (42 
     U.S.C. 4321 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 
     implement the provisions of 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 the 
     provisions of this section.

     ``SEC. 2605. INDIAN MINERAL DEVELOPMENT REVIEW.

       ``(a) In General.--The Secretary shall conduct a review of 
     all activities being conducted under the Indian Mineral 
     Development Act of 1982 (25 U.S.C. 2101 et seq.) as of that 
     date.
       ``(b) Report.--Not later than 1 year after the date of 
     enactment of the Indian Tribal Energy Development and Self-
     Determination Act of 2005, the Secretary shall submit to 
     Congress a report that includes--
       ``(1) the results of the review;
       ``(2) recommendations to ensure that Indian tribes have the 
     opportunity to develop Indian energy resources; and
       ``(3) an analysis of the barriers to the development of 
     energy resources on Indian land (including legal, fiscal, 
     market, and other barriers), along with recommendations for 
     the removal of those barriers.

     ``SEC. 2606. 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 are appropriate, 
     including administration of programs of the Bonneville Power 
     Administration and the Western Area Power Administration, in 
     accordance with this section.
       ``(c) Action by the Administrator.--In carrying out this 
     section, and in accordance with existing law--
       ``(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 pay more than the 
     prevailing market price for an energy product nor 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 by the Secretary of Energy 
     using nonreimbursable funds appropriated for that purpose, or 
     by the applicable Indian tribes.
       ``(e) Power Allocation Study.--Not later than 2 years after 
     the date of enactment of the Indian Tribal Energy Development 
     and Self-Determination 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 Western Area Power Administration (or 
     power sold by the Southwestern Power Administration) and the 
     Bonneville Power Administration to or for the benefit of 
     Indian tribes in service areas of those administrations; 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 other 
     power marketing administrations; 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, which shall remain available until expended and 
     shall not be reimbursable.''.
       (b) Conforming Amendment.--The table of contents for the 
     Energy Policy Act of 1992 is amended by striking the items 
     relating to title XXVI (other than the title heading) 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. Indian mineral development review.
``Sec. 2606. Federal Power Marketing Administrations.''.

     SEC. 504. CONSULTATION WITH INDIAN TRIBES.

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

     SEC. 505. FOUR CORNERS TRANSMISSION LINE PROJECT.

       The Dine Power Authority, an enterprise of the Navajo 
     Nation, shall be eligible to receive grants and other 
     assistance as authorized by section 217 of the Department of 
     Energy Organization Act, as added by section

[[Page 7156]]

     502 of this title, and section 2602 of the Energy Policy Act 
     of 1992, as amended by this title, for activities associated 
     with the development of a transmission line from the Four 
     Corners Area to southern Nevada, including related power 
     generation opportunities.

                       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 of Energy 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 OF ENERGY LIABILITY LIMIT.

       (a) Indemnification of Department of Energy 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. PROHIBITION ON ASSUMPTION BY UNITED STATES 
                   GOVERNMENT OF LIABILITY FOR CERTAIN FOREIGN 
                   INCIDENTS.

        Section 170 of the Atomic Energy Act of 1954 (42 U.S.C. 
     2210) is amended by adding at the end the following new 
     subsection:
       ``u. Prohibition on Assumption of Liability for Certain 
     Foreign Incidents.--Notwithstanding this section or 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 subsection shall not 
     apply to nuclear incidents occurring as a result of missions, 
     carried out under the direction of the Secretary of Energy, 
     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.''.

     SEC. 611. 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.

     SEC. 612. FINANCIAL ACCOUNTABILITY.

       (a) Amendment.--Section 170 of the Atomic Energy Act of 
     1954 (42 U.S.C. 2210) is amended by adding at the end the 
     following new subsection:
       ``v. Financial Accountability.--(1) Notwithstanding 
     subsection d., the Attorney General may bring an action in 
     the appropriate United States district court to recover from 
     a contractor of the Secretary (or subcontractor or supplier 
     of such contractor) amounts paid by the Federal Government 
     under an agreement of indemnification under subsection d. for 
     public liability resulting from conduct which constitutes 
     intentional misconduct of any corporate officer, manager, or 
     superintendent of such contractor (or subcontractor or 
     supplier of such contractor).

[[Page 7157]]

       ``(2) The Attorney General may recover under paragraph (1) 
     an amount not to exceed the amount of the profit derived by 
     the defendant from the contract.
       ``(3) No amount recovered from any contractor (or 
     subcontractor or supplier of such contractor) under paragraph 
     (1) may be reimbursed directly or indirectly by the 
     Department of Energy.
       ``(4) Paragraph (1) shall not apply to any nonprofit entity 
     conducting activities under contract for the Secretary.
       ``(5) No waiver of a defense required under this section 
     shall prevent a defendant from asserting such defense in an 
     action brought under this subsection.
       ``(6) The Secretary shall, by rule, define the terms 
     `profit' and `nonprofit entity' for purposes of this 
     subsection. Such rulemaking shall be completed not later than 
     180 days after the date of the enactment of this 
     subsection.''.
       (b) Effective Date.--The amendment made by this section 
     shall not apply to any agreement of indemnification entered 
     into under section 170 d. of the Atomic Energy Act of 1954 
     (42 U.S.C. 2210(d)) before the date of the enactment of this 
     Act.

                  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. NRC TRAINING PROGRAM.

       (a) In General.--In order to maintain the human resource 
     investment and infrastructure of the United States in the 
     nuclear sciences, health physics, and engineering fields, in 
     accordance with the statutory authorities of the Nuclear 
     Regulatory Commission relating to the civilian nuclear energy 
     program, the Nuclear Regulatory Commission shall carry out a 
     training and fellowship program to address shortages of 
     individuals with critical nuclear safety regulatory skills.
       (b) Authorization of Appropriations.--
       (1) In general.--There are authorized to be appropriated to 
     the Nuclear Regulatory Commission to carry out this section 
     $1,000,000 for each of fiscal years 2005 through 2009.
       (2) Availability.--Funds made available under paragraph (1) 
     shall remain available until expended.

     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.

        Section 161 of the Atomic Energy Act of 1954 (42 U.S.C. 
     2201) is amended by adding at the end the following:
       ``y. Exempt from the application of sections 8344 and 8468 
     of title 5, United States Code, an annuitant who was formerly 
     an employee of the Commission who is hired by the Commission 
     as a consultant, if the Commission finds that the annuitant 
     has a skill that is critical to the performance of the duties 
     of the Commission.''.

     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. 629. REPORT ON FEASIBILITY OF DEVELOPING COMMERCIAL 
                   NUCLEAR ENERGY GENERATION FACILITIES AT 
                   EXISTING DEPARTMENT OF ENERGY SITES.

        Not later than 1 year after the date of the enactment of 
     this Act, the Secretary of Energy shall submit to Congress a 
     report on the feasibility of developing commercial nuclear 
     energy generation facilities at Department of Energy sites in 
     existence on the date of enactment of this Act.

     SEC. 630. URANIUM SALES.

       (a) Sales, Transfers, and Services.--Section 3112 of the 
     USEC Privatization Act (42 U.S.C. 2297h-10) is amended by 
     striking subsections (d), (e), and (f) and inserting the 
     following:
       ``(3) The Secretary may transfer to the Corporation, 
     notwithstanding subsections (b)(2) and (d), natural uranium 
     in amounts sufficient to fulfill the Department of Energy's 
     commitments under Article 4(B) of the Agreement between the 
     Department and the Corporation dated June 17, 2002.
       ``(d) Inventory Sales.--(1) In addition to the transfers 
     and sales authorized under subsections (b) and (c) and under 
     paragraph (5) of this subsection, the United States 
     Government may transfer or sell uranium in any form subject 
     to paragraphs (2), (3), and (4).
       ``(2) Except as provided in subsections (b) and (c) and 
     paragraph (5) of this subsection, no sale or transfer of 
     uranium shall be made under this subsection by the United 
     States Government unless--
       ``(A) the President determines that the material is not 
     necessary for national security needs and the sale or 
     transfer has no adverse impact on implementation of existing 
     government-to-government agreements;
       ``(B) the price paid to the appropriate Federal agency, if 
     the transaction is a sale, will not be less than the fair 
     market value of the material; and
       ``(C) the sale or transfer to commercial nuclear power end 
     users is made pursuant to a contract of at least 3 years' 
     duration.
       ``(3) Except as provided in paragraph (5), the United 
     States Government shall not make any transfer or sale of 
     uranium in any form under this subsection that would cause 
     the total amount of uranium transferred or sold pursuant to 
     this subsection that is delivered for consumption by 
     commercial nuclear power end users to exceed--
       ``(A) 3,000,000 pounds of U3 O8 
     equivalent in fiscal year 2005, 2006, 2007, 2008, or 2009;
       ``(B) 5,000,000 pounds of U3O8 
     equivalent in fiscal year 2010 or 2011;
       ``(C) 7,000,000 pounds of U3O8 
     equivalent in fiscal year 2012; and
       ``(D) 10,000,000 pounds of U3O8 
     equivalent in fiscal year 2013 or any fiscal year thereafter.
       ``(4) Except for sales or transfers under paragraph (5), 
     for the purposes of this subsection, the recovery of uranium 
     from uranium bearing materials transferred or sold by the 
     United States Government to the domestic uranium industry 
     shall be the preferred method of making uranium available. 
     The recovered uranium shall be counted against the annual 
     maximum deliveries set forth in this section, when such 
     uranium is sold to end users.
       ``(5) The United States Government may make the following 
     sales and transfers:
       ``(A) Sales or transfers to a Federal agency if the 
     material is transferred for the use of the receiving agency 
     without any resale or transfer to another entity and the 
     material does not meet commercial specifications.
       ``(B) Sales or transfers to any person for national 
     security purposes, as determined by the Secretary.
       ``(C) Sales or transfers to any State or local agency or 
     nonprofit, charitable, or educational institution for use 
     other than the generation of electricity for commercial use.
       ``(D) Sales or transfers to the Department of Energy 
     research reactor sales program.
       ``(E) Sales or transfers, at fair market value, for 
     emergency purposes in the event of a disruption in supply to 
     commercial nuclear power end users in the United States.
       ``(F) Sales or transfers, at fair market value, for use in 
     a commercial reactor in the United States with nonstandard 
     fuel requirements.
       ``(G) Sales or transfers provided for under law for use by 
     the Tennessee Valley Authority in relation to the Department 
     of Energy's highly enriched uranium or tritium programs.
       ``(6) For purposes of this subsection, the term `United 
     States Government' does not include the Tennessee Valley 
     Authority.
       ``(e) Savings Provision.--Nothing in this subchapter 
     modifies the terms of the Russian HEU Agreement.
       ``(f) Services.--Notwithstanding any other provision of 
     this section, if the Secretary determines that the 
     Corporation has failed, or may fail, to perform any 
     obligation under the Agreement between the Department of

[[Page 7158]]

     Energy and the Corporation dated June 17, 2002, and as 
     amended thereafter, which failure could result in termination 
     of the Agreement, the Secretary shall notify Congress, in 
     such a manner that affords Congress an opportunity to 
     comment, prior to a determination by the Secretary whether 
     termination, waiver, or modification of the Agreement is 
     required. The Secretary is authorized to take such action as 
     he determines necessary under the Agreement to terminate, 
     waive, or modify provisions of the Agreement to achieve its 
     purposes.''.
       (b) Report.--Not later than 3 years after the date of 
     enactment of this Act, the Secretary of Energy shall report 
     to Congress on the implementation of this section. The report 
     shall include a discussion of available excess uranium 
     inventories; all sales or transfers made by the United States 
     Government; the impact of such sales or transfers on the 
     domestic uranium industry, the spot market uranium price, and 
     the national security interests of the United States; and any 
     steps taken to remediate any adverse impacts of such sales or 
     transfers.

     SEC. 631. COOPERATIVE RESEARCH AND DEVELOPMENT AND SPECIAL 
                   DEMONSTRATION PROJECTS FOR THE URANIUM MINING 
                   INDUSTRY.

       (a) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary of Energy $10,000,000 for 
     each of fiscal years 2006, 2007, and 2008 for--
       (1) cooperative, cost-shared agreements between the 
     Department of Energy and domestic uranium producers to 
     identify, test, and develop improved in situ leaching mining 
     technologies, including low-cost environmental restoration 
     technologies that may be applied to sites after completion of 
     in situ leaching operations; and
       (2) funding for competitively selected demonstration 
     projects with domestic uranium producers relating to--
       (A) enhanced production with minimal environmental impacts;
       (B) restoration of well fields; and
       (C) decommissioning and decontamination activities.
       (b) Domestic Uranium Producer.--For purposes of this 
     section, the term ``domestic uranium producer'' has the 
     meaning given that term in section 1018(4) of the Energy 
     Policy Act of 1992 (42 U.S.C. 2296b-7(4)), except that the 
     term shall not include any producer that has not produced 
     uranium from domestic reserves on or after July 30, 1998.
       (c) Limitation.--No activities funded under this section 
     may be carried out in the State of New Mexico.

     SEC. 632. 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 ``; and'' and
       (3) by adding at the end the following:
       ``(E) a contractor or subcontractor of the Commission.''.
       (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 540 days 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. 633. 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
       ``(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.

[[Page 7159]]

       ``(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. 634. FERNALD BYPRODUCT MATERIAL.

        Title III of the Nuclear Waste Policy Act of 1982 (42 
     U.S.C. 10221 et seq.) is amended by adding at the end the 
     following new section:


                      ``Fernald byproduct material

       ``Sec. 307. Notwithstanding any other law, the material in 
     the concrete silos at the Fernald uranium processing facility 
     managed on the date of enactment of this section by the 
     Department shall be considered byproduct material (as defined 
     by section 11 e.(2) of the Atomic Energy Act of 1954 (42 
     U.S.C. 2014(e)(2))). The Department may dispose of the 
     material in a facility regulated by the Commission or by an 
     Agreement State. If the Department disposes of the material 
     in such a facility, the Commission or the Agreement State 
     shall regulate the material as byproduct material under that 
     Act. This material shall remain subject to the jurisdiction 
     of the Department until it is received at a commercial, 
     Commission-licensed, or Agreement State-licensed facility, at 
     which time the material shall be subject to the health and 
     safety requirements of the Commission or the Agreement State 
     with jurisdiction over the disposal site.''.

     SEC. 635. SAFE DISPOSAL OF GREATER-THAN-CLASS C RADIOACTIVE 
                   WASTE.

        Subtitle D of title I of the Nuclear Waste Policy Act of 
     1982 (42 U.S.C. 10171) is amended by adding at the end the 
     following new section:


       ``Safe disposal of greater-than-class c radioactive waste

       ``Sec. 152. (a) Designation of Responsibility.--The 
     Secretary shall designate an Office within the Department to 
     have the responsibility for activities needed to develop a 
     new, or use an existing, facility for safely disposing of all 
     low-level radioactive waste with concentrations of 
     radionuclides that exceed the limits established by the 
     Commission for Class C radioactive waste (referred to in this 
     section as `GTCC waste').
       ``(b) Comprehensive Plan.--The Secretary shall develop a 
     comprehensive plan for permanent disposal of GTCC waste which 
     includes plans for a disposal facility. This plan shall be 
     transmitted to Congress in a series of reports, including the 
     following:
       ``(1) Report on short-term plan.--Not later than 180 days 
     after the date of enactment of this section, the Secretary 
     shall submit to Congress a plan describing the Secretary's 
     operational strategy for continued recovery and storage of 
     GTCC waste until a permanent disposal facility is available.
       ``(2) Update of 1987 report.--
       ``(A) In general.--Not later than 1 year after the date of 
     enactment of this section, the Secretary shall submit to 
     Congress an update of the Secretary's February 1987 report 
     submitted to Congress that made comprehensive recommendations 
     for the disposal of GTCC waste.
       ``(B) Contents.--The update under this paragraph shall 
     contain--
       ``(i) a detailed description and identification of the GTCC 
     waste that is to be disposed;
       ``(ii) a description of current domestic and international 
     programs, both Federal and commercial, for management and 
     disposition of GTCC waste;
       ``(iii) an identification of the Federal and private 
     options and costs for the safe disposal of GTCC waste;
       ``(iv) an identification of the options for ensuring that, 
     wherever possible, generators and users of GTCC waste bear 
     all reasonable costs of waste disposal;
       ``(v) an identification of any new statutory authority 
     required for disposal of GTCC waste; and
       ``(vi) in coordination with the Environmental Protection 
     Agency and the Commission, an identification of any new 
     regulatory guidance needed for the disposal of GTCC waste.
       ``(3) Report on cost and schedule for completion of 
     environmental impact statement and record of decision.--Not 
     later than 180 days after the date of submission of the 
     update required under paragraph (2), the Secretary shall 
     submit to Congress a report containing an estimate of the 
     cost and schedule to complete a draft and final environmental 
     impact statement and to issue a record of decision for a 
     permanent disposal facility, utilizing either a new or 
     existing facility, for GTCC waste.''.

     SEC. 636. 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 Nuclear Regulatory 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. 638. NATIONAL URANIUM STOCKPILE.

       The USEC Privatization Act (42 U.S.C. 2297h et seq.) is 
     amended by adding at the end the following new section:

     ``SEC. 3118. NATIONAL URANIUM STOCKPILE.

       ``(a) Stockpile Creation.--The Secretary of Energy may 
     create a national low-enriched uranium stockpile with the 
     goals to--
       ``(1) enhance national energy security; and
       ``(2) reduce global proliferation threats.
       ``(b) Source of Material.--The Secretary shall obtain 
     material for the stockpile from--
       ``(1) material derived from blend-down of Russian highly 
     enriched uranium derived from weapons materials; and
       ``(2) domestically mined and enriched uranium.
       ``(c) Limitation on Sales or Transfers.--Sales or transfer 
     of materials in the stockpile shall occur pursuant to section 
     3112.''.

     SEC. 639. NUCLEAR REGULATORY COMMISSION MEETINGS.

       If a quorum of the Nuclear Regulatory Commission gathers to 
     discuss official Commission business the discussions shall be 
     recorded, and the Commission shall notify the public of such 
     discussions within 15 days after they occur. The Commission 
     shall promptly make a transcript of the recording available 
     to the public on request, except to the extent that public 
     disclosure is exempted or prohibited by law. This section 
     shall not apply to a meeting, within the meaning of that term 
     under section 552b(a)(2) of title 5, United States Code.

     SEC. 640. EMPLOYEE BENEFITS.

       Section 3110 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.--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;
       ``(B) has been an employee of the Department of Energy's 
     predecessor management and integrating contractor (or its 
     first or

[[Page 7160]]

     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.''.

         Subtitle C--Additional Hydrogen Production Provisions

     SEC. 651. HYDROGEN PRODUCTION PROGRAMS.

       (a) Advanced Reactor Hydrogen Cogeneration Project.--
       (1) Project establishment.-- The Secretary is directed to 
     establish an Advanced Reactor Hydrogen Cogeneration Project.
       (2) Project definition.-- The project shall consist of the 
     research, development, design, construction, and operation of 
     a hydrogen production cogeneration research facility that, 
     relative to the current commercial reactors, enhances safety 
     features, reduces waste production, enhances thermal 
     efficiencies, increases proliferation resistance, and has the 
     potential for improved economics and physical security in 
     reactor siting. This facility shall be constructed so as to 
     enable research and development on advanced reactors of the 
     type selected and on alternative approaches for reactor-based 
     production of hydrogen.
       (3) Project management.--
       (A) Management.--The project shall be managed within the 
     Department by the Office of Nuclear Energy, Science, and 
     Technology.
       (B) Lead laboratory.--The lead laboratory for the project, 
     providing the site for the reactor construction, shall be the 
     Idaho National Laboratory (in this subsection referred to as 
     ``INL'').
       (C) Steering committee.--The Secretary shall establish a 
     national steering committee with membership from the national 
     laboratories, universities, and industry to provide advice to 
     the Secretary and the Director of the Office of Nuclear 
     Energy, Science, and Technology on technical and program 
     management aspects of the project.
       (D) Collaboration.--Project activities shall be conducted 
     at INL, other national laboratories, universities, domestic 
     industry, and international partners.
       (4) Project requirements.--
       (A) Research and development.--
       (i) In general.--The project shall include planning, 
     research and development, design, and construction of an 
     advanced, next-generation, nuclear energy system suitable for 
     enabling further research and development on advanced reactor 
     technologies and alternative approaches for reactor-based 
     generation of hydrogen.
       (ii) Reactor test capabilities at inl.--The project shall 
     utilize, where appropriate, extensive reactor test 
     capabilities resident at INL.
       (iii) Alternatives.--The project shall be designed to 
     explore technical, environmental, and economic feasibility of 
     alternative approaches for reactor-based hydrogen production.
       (iv) Industrial lead.--The industrial lead for the project 
     shall be a company incorporated in the United States.
       (B) International collaboration.--
       (i) In general.--The Secretary shall seek international 
     cooperation, participation, and financial contribution in 
     this project.
       (ii) Assistance from international partners.--The Secretary 
     may contract for assistance from specialists or facilities 
     from member countries of the Generation IV International 
     Forum, the Russian Federation, or other international 
     partners where such specialists or facilities provide access 
     to cost-effective and relevant skills or test capabilities.
       (iii) Generation iv international forum.--International 
     activities shall be coordinated with the Generation IV 
     International Forum.
       (iv) Generation iv nuclear energy systems program.--The 
     Secretary may combine this project with the Generation IV 
     Nuclear Energy Systems Program.
       (C) Demonstration.--The overall project, which may involve 
     demonstration of selected project objectives in a partner 
     nation, must demonstrate both electricity and hydrogen 
     production and may provide flexibility, where technically and 
     economically feasible in the design and construction, to 
     enable tests of alternative reactor core and cooling 
     configurations.
       (D) Partnerships.--The Secretary shall establish cost-
     shared partnerships with domestic industry or international 
     participants for the research, development, design, 
     construction, and operation of the research facility, and 
     preference in determining the final project structure shall 
     be given to an overall project which retains United States 
     leadership while maximizing cost sharing opportunities and 
     minimizing Federal funding responsibilities.
       (E) Target date.--The Secretary shall select technologies 
     and develop the project to provide initial testing of either 
     hydrogen production or electricity generation by 2011, or 
     provide a report to Congress explaining why this date is not 
     feasible.
       (F) Waiver of construction timelines.--The Secretary is 
     authorized to conduct the Advanced Reactor Hydrogen 
     Cogeneration Project without the constraints of DOE Order 
     413.3, relating to program and project management for the 
     acquisition of capital assets, as necessary to meet the 
     specified operational date.
       (G) Competition.--The Secretary may fund up to 2 teams for 
     up to 1 year to develop detailed proposals for competitive 
     evaluation and selection of a single proposal and concept for 
     further progress. The Secretary shall define the format of 
     the competitive evaluation of proposals.
       (H) Use of facilities.--Research facilities in industry, 
     national laboratories, or universities either within the 
     United States or with cooperating international partners may 
     be used to develop the enabling technologies for the research 
     facility. Utilization of domestic university-based facilities 
     shall be encouraged to provide educational opportunities for 
     student development.
       (I) Role of nuclear regulatory commission.--
       (i) In general.--The Nuclear Regulatory Commission shall 
     have licensing and regulatory authority for any reactor 
     authorized under this subsection, pursuant to section 202 of 
     the Energy Reorganization Act of 1974 (42 U.S.C. 5842).
       (ii) Risk-based criteria.--The Secretary shall seek active 
     participation of the Nuclear Regulatory Commission throughout 
     the project to develop risk-based criteria for any future 
     commercial development of a similar reactor architecture.
       (J) Report.--The Secretary shall develop and transmit to 
     Congress a comprehensive project plan not later than 3 months 
     after the date of enactment of this Act. The project plan 
     shall be updated annually with each annual budget submission.
       (b) Advanced Nuclear Reactor Technologies.--The Secretary 
     shall--
       (1) prepare a detailed roadmap for carrying out the 
     provisions in this subtitle related to advanced nuclear 
     reactor technologies and for implementing the recommendations 
     related to advanced nuclear reactor technologies that are 
     included in the report transmitted under subsection (d); and
       (2) provide for the establishment of 5 projects in 
     geographic areas that are regionally and climatically diverse 
     to demonstrate the commercial production of hydrogen at 
     existing nuclear power plants, including one demonstration 
     project at a national laboratory or institution of higher 
     education using an advanced gas-cooled reactor.
       (c) Collocation With Hydrogen Production Facility.--Section 
     103 of the Atomic Energy Act of 1954 (42 U.S.C. 2011) is 
     amended by adding at the end the following new subsection:
       ``g. The Commission shall give priority to the licensing of 
     a utilization facility that is collocated with a hydrogen 
     production facility. The Commission shall issue a final 
     decision approving or disapproving the issuance of a license 
     to construct and operate a utilization facility not later 
     than the expiration of 3 years after the date of the 
     submission of such application, if the application references 
     a Commission-certified design and an early site permit, 
     unless the Commission determines that the applicant has 
     proposed material and substantial changes to the design or 
     the site design parameters.''.
       (d) Report.--The Secretary shall transmit to the Congress 
     not later than 120 days after the date of enactment of this 
     Act a report containing detailed summaries of the roadmaps 
     prepared under subsection (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 nuclear reactor energy 
     technologies for the production of hydrogen.
       (e) Authorization of Appropriations.--For the purpose of 
     supporting research programs related to the development of 
     advanced nuclear reactor technologies under this section, 
     there are authorized to be appropriated to the Secretary--
       (1) $65,000,000 for fiscal year 2006;
       (2) $74,750,000 for fiscal year 2007;
       (3) $85,962,500 for fiscal year 2008;
       (4) $98,856,875 for fiscal year 2009;
       (5) $113,685,406 for fiscal year 2010;
       (6) $130,738,217 for fiscal year 2011;
       (7) $150,348,950 for fiscal year 2012;
       (8) $172,901,292 for fiscal year 2013;
       (9) $198,836,486 for fiscal year 2014; and
       (10) $228,661,959 for fiscal year 2015.

     SEC. 652. DEFINITIONS.

       For purposes of this subtitle--
       (1) the term ``advanced nuclear reactor technologies'' 
     means--
       (A) technologies related to advanced light water reactors 
     that may be commercially available in the near-term, 
     including mid-sized reactors with passive safety features, 
     for the generation of electric power from nuclear fission and 
     the production of hydrogen; and
       (B) technologies related to other nuclear reactors that may 
     require prototype demonstration prior to availability in the 
     mid-term or long-term, including high-temperature, gas-cooled 
     reactors and liquid metal reactors, for the generation of 
     electric power from nuclear fission and the production of 
     hydrogen;
       (2) the term ``institution of higher education'' has the 
     meaning given to that term

[[Page 7161]]

     in section 101(a) of the Higher Education Act of 1965 (20 
     U.S.C. 1001(a)); and
       (3) the term ``Secretary'' means the Secretary of Energy.

                      Subtitle D--Nuclear Security

     SEC. 661. NUCLEAR FACILITY THREATS.

       (a) Study.--The President, in consultation with the Nuclear 
     Regulatory Commission (referred to in this subtitle as the 
     ``Commission'') and other appropriate Federal, State, and 
     local agencies and private entities, shall conduct a study to 
     identify the types of threats that pose an appreciable risk 
     to the security of the various classes of facilities licensed 
     by the Commission under the Atomic Energy Act of 1954 (42 
     U.S.C. 2011 et seq.). Such study shall take into account, 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.
       (b) Summary and Classification Report.--Not later than 180 
     days after the date of the enactment of this Act, the 
     President shall transmit to Congress and the Commission a 
     report--
       (1) summarizing the types of threats identified under 
     subsection (a); and
       (2) classifying each type of threat identified under 
     subsection (a), in accordance with existing laws and 
     regulations, as either--
       (A) involving attacks and destructive acts, including 
     sabotage, directed against the facility by an enemy of the 
     United States, whether a foreign government or other person, 
     or otherwise falling under the responsibilities of the 
     Federal Government; or
       (B) involving the type of risks that Commission licensees 
     should be responsible for guarding against.
       (c) Federal Action Report.--Not later than 90 days after 
     the date on which a report is transmitted under subsection 
     (b), the President shall transmit to Congress a report on 
     actions taken, or to be taken, to address the types of 
     threats identified under subsection (b)(2)(A), including 
     identification of the Federal, State, and local agencies 
     responsible for carrying out the obligations and authorities 
     of the United States. Such report may include a classified 
     annex, as appropriate.
       (d) Regulations.--Not later than 180 days after the date on 
     which a report is transmitted under subsection (b), the 
     Commission may revise, by rule, the design basis threats 
     issued before the date of enactment of this section as the 
     Commission considers appropriate based on the summary and 
     classification report.
       (e) Physical Security Program.--The Commission shall 
     establish an operational safeguards response evaluation 
     program that ensures that the physical protection capability 
     and operational safeguards response for sensitive nuclear 
     facilities, as determined by the Commission consistent with 
     the protection of public health and the common defense and 
     security, shall be tested periodically through Commission 
     approved or designed, observed, and evaluated force-on-force 
     exercises to determine whether the ability to defeat the 
     design basis threat is being maintained. For purposes of this 
     subsection, the term ``sensitive nuclear facilities'' 
     includes at a minimum commercial nuclear power plants and 
     category I fuel cycle facilities.
       (f) Control of Information.--Notwithstanding any other 
     provision of law, the Commission may undertake any rulemaking 
     under this subtitle in a manner that will fully protect 
     safeguards and classified national security information.
       (g) Federal Security Coordinators.--
       (1) Regional offices.--Not later than 18 months after the 
     date of enactment of this Act, the Commission shall assign a 
     Federal security coordinator, under the employment of the 
     Commission, to each region of the Commission.
       (2) Responsibilities.--The Federal security coordinator 
     shall be responsible for--
       (A) 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;
       (B) ensuring that such classes of facilities as the 
     Commission determines to be appropriate maintain security 
     consistent with the security plan in accordance with the 
     appropriate threat level; and
       (C) 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.
       (h) Training Program.--The President shall establish a 
     program to provide technical assistance and training to 
     Federal agencies, the National Guard, and State and local law 
     enforcement and emergency response agencies in responding to 
     threats against a designated nuclear facility.

     SEC. 662. FINGERPRINTING FOR CRIMINAL HISTORY RECORD CHECKS.

       (a) In General.--Subsection a. of section 149 of the Atomic 
     Energy Act of 1954 (42 U.S.C. 2169(a)) is amended--
       (1) by striking ``a. The Nuclear'' and all that follows 
     through ``section 147.'' and inserting the following:
       ``a. In General.--
       ``(1) Requirements.--
       ``(A) In general.--The Commission shall require each 
     individual or entity--
       ``(i) that is licensed or certified to engage in an 
     activity subject to regulation by the Commission;
       ``(ii) that has filed an application for a license or 
     certificate to engage in an activity subject to regulation by 
     the Commission; or
       ``(iii) that has 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,

     to fingerprint each individual described in subparagraph (B) 
     before the individual is permitted unescorted access or 
     access, whichever is applicable, as described in subparagraph 
     (B).
       ``(B) Individuals required to be fingerprinted.--The 
     Commission shall require to be fingerprinted each 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.'';
       (2) by striking ``All fingerprints obtained by a licensee 
     or applicant as required in the preceding sentence'' and 
     inserting the following:
       ``(2) Submission to the attorney general.--All fingerprints 
     obtained by an individual or entity as required in paragraph 
     (1)'';
       (3) 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) Costs.--The costs of any identification and records 
     check conducted pursuant to paragraph (1) shall be paid by 
     the individual or entity required to conduct the 
     fingerprinting under paragraph (1)(A).''; and
       (4) 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) Provision to individual or entity required to conduct 
     fingerprinting.--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 the individual or entity required to conduct 
     the fingerprinting under paragraph (1)(A).''.
       (b) Administration.--Subsection c. of section 149 of the 
     Atomic Energy Act of 1954 (42 U.S.C. 2169(c)) is amended--
       (1) by striking ``, subject to public notice and comment, 
     regulations--'' and inserting ``requirements--''; and
       (2) by striking, in paragraph (2)(B), ``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)''.
       (c) Biometric Methods.--Subsection d. of section 149 of the 
     Atomic Energy Act of 1954 (42 U.S.C. 2169(d)) is redesignated 
     as subsection e., and the following is inserted after 
     subsection c.:
       ``d. Use of Other Biometric Methods.--The Commission may 
     satisfy any requirement for a person to conduct 
     fingerprinting under this section using any other biometric 
     method for identification approved for use by the Attorney 
     General, after the Commission has approved the alternative 
     method by rule.''.

[[Page 7162]]



     SEC. 663. USE OF FIREARMS BY SECURITY PERSONNEL OF LICENSEES 
                   AND CERTIFICATE HOLDERS OF THE COMMISSION.

        Section 161 of the Atomic Energy Act of 1954 (42 U.S.C. 
     2201) is amended by adding at the end the following 
     subsection:
       ``(z)(1) notwithstanding section 922(o), (v), and (w) of 
     title 18, United States Code, or any similar provision of any 
     State law or any similar rule or regulation of a State or any 
     political subdivision of a State prohibiting the transfer or 
     possession of a handgun, a rifle or shotgun, a short-barreled 
     shotgun, a short-barreled rifle, a machinegun, a 
     semiautomatic assault weapon, ammunition for the foregoing, 
     or a large capacity ammunition feeding device, authorize 
     security personnel of licensees and certificate holders of 
     the Commission (including employees of contractors of 
     licensees and certificate holders) to receive, possess, 
     transport, import, and use 1 or more of those weapons, 
     ammunition, or devices, if the Commission determines that--
       ``(A) such authorization is necessary to the discharge of 
     the security personnel's official duties; and
       ``(B) the security personnel--
       ``(i) are not otherwise prohibited from possessing or 
     receiving a firearm under Federal or State laws pertaining to 
     possession of firearms by certain categories of persons;
       ``(ii) have successfully completed requirements established 
     through guidelines implementing this subsection for training 
     in use of firearms and tactical maneuvers;
       ``(iii) are engaged in the protection of--

       ``(I) facilities owned or operated by a Commission licensee 
     or certificate holder that are designated by the Commission; 
     or
       ``(II) radioactive material or other property owned or 
     possessed by a person that is 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

       ``(iv) are discharging their official duties.
       ``(2) Such receipt, possession, transportation, 
     importation, or use shall be subject to--
       ``(A) chapter 44 of title 18, United States Code, except 
     for section 922(a)(4), (o), (v), and (w);
       ``(B) chapter 53 of title 26, United States Code, except 
     for section 5844; and
       ``(C) a background check by the Attorney General, based on 
     fingerprints and including a check of the system established 
     under section 103(b) of the Brady Handgun Violence Prevention 
     Act (18 U.S.C. 922 note) to determine whether the person 
     applying for the authority is prohibited from possessing or 
     receiving a firearm under Federal or State law.
       ``(3) This subsection shall become effective upon the 
     issuance of guidelines by the Commission, with the approval 
     of the Attorney General, to govern the implementation of this 
     subsection.
       ``(4) In this subsection, the terms `handgun', `rifle', 
     `shotgun', `firearm', `ammunition', `machinegun', 
     `semiautomatic assault weapon', `large capacity ammunition 
     feeding device', `short-barreled shotgun', and `short-
     barreled rifle' shall have the meanings given those terms in 
     section 921(a) of title 18, United States Code.''.

     SEC. 664. UNAUTHORIZED INTRODUCTION OF DANGEROUS WEAPONS.

        Section 229 a. of the Atomic Energy Act of 1954 (42 U.S.C. 
     2278a(a)) is amended in the first sentence by inserting ``or 
     subject to the licensing authority of the Commission or to 
     certification by the Commission under this Act or any other 
     Act'' before the period at the end.

     SEC. 665. SABOTAGE OF NUCLEAR FACILITIES OR FUEL.

       (a) In General.--Section 236 a. 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 ``storage, treatment, 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 Nuclear Regulatory Commission that, before 
     the date of the offense, the Nuclear Regulatory 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) Penalties.--Section 236 of the Atomic Energy Act of 
     1954 (42 U.S.C. 2284) is amended by striking ``$10,000 or 
     imprisoned for not more than 20 years, or both, and, if death 
     results to any person, shall be imprisoned for any term of 
     years or for life'' both places it appears and inserting 
     ``$1,000,000 or imprisoned for up to life without parole''.

     SEC. 666. SECURE TRANSFER OF NUCLEAR MATERIALS.

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

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

       ``a. The Nuclear Regulatory 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 170C 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) Table of Sections Amendment.--The table of sections for 
     chapter 14 of the Atomic Energy Act of 1954 is amended by 
     adding at the end the following new item:

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

     SEC. 667. 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.

     SEC. 668. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--There are authorized to be appropriated 
     such sums as are necessary to carry out this subtitle and the 
     amendments made by this subtitle.
       (b) Nuclear Regulatory Commission User Fees and Annual 
     Charges.--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.''.
       (c) Repeal.--Section 7601 of the Consolidated Omnibus 
     Budget Reconciliation Act of 1985 (42 U.S.C. 2213) is 
     repealed.

[[Page 7163]]



                     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.
       ``(ii) 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. 704. 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. 705. LEASE CONDENSATES.

       (a) Lease Condensate Fuels.--Section 301 of the Energy 
     Policy Act of 1992 (42 U.S.C. 13211) is amended--
       (1) in paragraph (2), by inserting ``mixtures containing 50 
     percent or more by volume of lease condensate or fuels 
     extracted from lease condensate;'' after ``liquefied 
     petroleum gas;'';
       (2) in paragraph (13), by striking ``and'' at the end;
       (3) in paragraph (14)--
       (A) by inserting ``mixtures containing 50 percent or more 
     by volume of lease condensate or fuels extracted from lease 
     condensate,'' after ``liquefied petroleum gas,''; and
       (B) by striking the period and inserting ``; and'';
       (4) by adding at the end the following:
       ``(15) the term `lease condensate' means a mixture, 
     primarily of pentanes and heavier hydrocarbons, that is 
     recovered as a liquid from natural gas in lease separation 
     facilities.''.
       (b) Lease Condensate Use Credits.--
       (1) In general.--Title III of the Energy Policy Act of 1992 
     (42 U.S.C. 13211 et seq.) is amended by adding at the end the 
     following:

     ``SEC. 313. LEASE CONDENSATE USE CREDITS.

       ``(a) In General.--Subject to subsection (d), the Secretary 
     shall allocate 1 credit under this section to a fleet or 
     covered person for each qualifying volume of the lease 
     condensate component of fuel containing at least 50 percent 
     lease condensate, or fuels extracted from lease condensate, 
     after the date of enactment of this section for use by the 
     fleet or covered person in vehicles owned or operated by the 
     fleet or covered person that weigh more than 8,500 pounds 
     gross vehicle weight rating.
       ``(b) Requirements.--A credit allocated under this 
     section--
       ``(1) shall be subject to the same exceptions, authority, 
     documentation, and use of credits that are specified for 
     qualifying volumes of biodiesel in section 312; and
       ``(2) shall not be considered a credit under section 508.
       ``(c) Regulation.--
       ``(1) In general.--Subject to subsection (d), not later 
     than January 1, 2006, after the collection of appropriate 
     information and data that consider usage options, uses in 
     other industries, products, or processes, potential volume 
     capacities, costs, air emissions, and fuel efficiencies, the 
     Secretary shall issue a regulation establishing requirements 
     and procedures for the implementation of this section.
       ``(2) Qualifying volume.--The regulation shall include a 
     determination of an appropriate qualifying volume for lease 
     condensate, except that in no case shall the Secretary 
     determine that the qualifying volume for lease condensate is 
     less than 1,125 gallons.
       ``(d) Applicability.--This section applies unless the 
     Secretary finds that the use of lease condensate as an 
     alternative fuel would adversely affect public health or 
     safety or ambient air quality or the environment.''.
       (2) 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 of the items relating to title 
     III the following:

``Sec. 313. Lease condensate use credits.''.

       (c) 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''.

     SEC. 706. 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 of Energy 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. 707. 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''.

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

                        PART 1--HYBRID VEHICLES

     SEC. 711. HYBRID VEHICLES.

       The Secretary of Energy 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. HYBRID RETROFIT AND ELECTRIC CONVERSION PROGRAM.

       (a) Establishment.--The Administrator of the Environmental 
     Protection Agency, in consultation with the Secretary, shall 
     establish a program for awarding grants on a competitive 
     basis to entities for the installation of hybrid retrofit and 
     electric conversion technologies for combustion engine 
     vehicles.
       (b) Eligible Recipients.--A grant shall be awarded under 
     this section only--
       (1) to a local or State governmental entity;
       (2) to a for-profit or nonprofit corporation or other 
     person; or
       (3) to 1 or more contracting entities that service 
     combustion engine vehicles for an entity described in 
     paragraph (1) or (2).
       (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 per 
     proposal or per vehicle; or
       (B) involve the use of emissions control retrofit or 
     conversion technology.
       (d) Conditions of Grant.--A grant shall be provided under 
     this section on the conditions that--
       (1) combustion engine vehicles on which hybrid retrofit or 
     conversion technology are to be demonstrated--
       (A) with the retrofit or conversion technology applied will 
     achieve low-emission standards consistent with the Voluntary 
     National Low Emission Vehicle Program for Light-Duty Vehicles 
     and Light-Duty Trucks (40 CFR Part 86) without model year 
     restrictions; and
       (B) will be used for a minimum of 3 years;
       (2) grant funds will be used for the purchase of hybrid 
     retrofit or conversion technology, including State taxes and 
     contract fees; and
       (3) grant recipients will provide at least 15 percent of 
     the total cost of the retrofit or conversion, including the 
     purchase of hybrid

[[Page 7164]]

     retrofit or conversion technology and all necessary labor for 
     installation of the retrofit or conversion.
       (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 verify--
       (1) the hybrid retrofit or conversion technology to be 
     demonstrated; and
       (2) 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--
       (1) $20,000,000 for fiscal year 2005;
       (2) $35,000,000 for fiscal year 2006;
       (3) $45,000,000 for fiscal year 2007; and
       (4) such sums as are necessary for each of fiscal years 
     2008 and 2009.

                       PART 2--ADVANCED VEHICLES

     SEC. 721. DEFINITIONS.

       In this part:
       (1) Alternative fueled vehicle.--
       (A) In general.--The term ``alternative fueled vehicle'' 
     means a vehicle propelled solely on an alternative fuel (as 
     defined in section 301 of the Energy Policy Act of 1992 (42 
     U.S.C. 13211)).
       (B) Exclusion.--The term ``alternative fueled vehicle'' 
     does not include a vehicle that the Secretary determines, by 
     regulation, does not yield substantial environmental benefits 
     over a vehicle operating solely on gasoline or diesel derived 
     from fossil fuels.
       (2) Fuel cell vehicle.--The term ``fuel cell vehicle'' 
     means a vehicle propelled by an electric motor powered by a 
     fuel cell system that converts chemical energy into 
     electricity by combining oxygen (from air) with hydrogen fuel 
     that is stored on the vehicle or is produced onboard by 
     reformation of a hydrocarbon fuel. Such fuel cell system may 
     or may not include the use of auxiliary energy storage 
     systems to enhance vehicle performance.
       (3) Hybrid vehicle.--The term ``hybrid vehicle'' means a 
     medium or heavy duty vehicle propelled by an internal 
     combustion engine or heat engine using any combustible fuel 
     and an onboard rechargeable energy storage device.
       (4) Neighborhood electric vehicle.--The term ``neighborhood 
     electric vehicle'' means a motor vehicle that--
       (A) meets the definition of a low-speed vehicle (as defined 
     in part 571 of title 49, Code of Federal Regulations);
       (B) meets the definition of a zero-emission vehicle (as 
     defined in section 86.1702-99 of title 40, Code of Federal 
     Regulations);
       (C) meets the requirements of Federal Motor Vehicle Safety 
     Standard No. 500; and
       (D) has a maximum speed of not greater than 25 miles per 
     hour.
       (5) Pilot program.--The term ``pilot program'' means the 
     competitive grant program established under section 722.
       (6) Secretary.--The term ``Secretary'' means the Secretary 
     of Energy.
       (7) Ultra-low sulfur diesel vehicle.--The term ``ultra-low 
     sulfur diesel vehicle'' means a vehicle manufactured in any 
     of model years 2004 through 2006 powered by a heavy-duty 
     diesel engine that--
       (A) is fueled by diesel fuel that contains sulfur at not 
     more than 15 parts per million; and
       (B) emits not more than the lesser of--
       (i) for vehicles manufactured in model years 2004 through 
     2006, 2.5 grams per brake horsepower-hour of nonmethane 
     hydrocarbons and oxides of nitrogen and .01 grams per brake 
     horsepower-hour of particulate matter; or
       (ii) the quantity of emissions of nonmethane hydrocarbons, 
     oxides of nitrogen, and particulate matter of the best-
     performing technology of ultra-low sulfur diesel vehicles of 
     the same class and application that are commercially 
     available.

     SEC. 722. PILOT PROGRAM.

       (a) Establishment.--The Secretary, in consultation with the 
     Secretary of Transportation, shall establish a competitive 
     grant pilot program, to be administered through the Clean 
     Cities Program of the Department of Energy, to provide not 
     more than 15 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, scooters, 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 of Energy; 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 $20,000,000 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.
       (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) Limit on Funding.--The Secretary shall provide not less 
     than 20 nor more than 25 percent of the grant funding made 
     available under this section for the acquisition of ultra-low 
     sulfur diesel vehicles.

     SEC. 723. 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;

[[Page 7165]]

       (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. 724. 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 of Energy, 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 of Energy 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 of Energy to carry out 
     this section $10,000,000 for each of fiscal years 2006 
     through 2010.

                     Subtitle C--Clean School Buses

     SEC. 741. DEFINITIONS.

       In this subtitle:
       (1) Administrator.--The term ``Administrator'' means the 
     Administrator of the Environmental Protection Agency.
       (2) Alternative fuel.--The term ``alternative fuel'' means 
     liquefied natural gas, compressed natural gas, liquefied 
     petroleum gas, hydrogen, propane, or methanol or ethanol at 
     no less than 85 percent by volume.
       (3) Alternative fuel school bus.--The term ``alternative 
     fuel school bus'' means a school bus that meets all of the 
     requirements of this subtitle and is operated solely on an 
     alternative fuel.
       (4) Emissions control retrofit technology.--The term 
     ``emissions control 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.
       (5) Idling.--The term ``idling'' means operating an engine 
     while remaining stationary for more than approximately 15 
     minutes, except that the term does not apply to routine 
     stoppages associated with traffic movement or congestion.
       (6) Secretary.--The term ``Secretary'' means the Secretary 
     of Energy.
       (7) 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.
       (8) Ultra-low sulfur diesel fuel school bus.--The term 
     ``ultra-low sulfur diesel fuel school bus'' means a school 
     bus that meets all of the requirements of this subtitle and 
     is operated solely on ultra-low sulfur diesel fuel.

     SEC. 742. PROGRAM FOR REPLACEMENT OF CERTAIN SCHOOL BUSES 
                   WITH CLEAN SCHOOL BUSES.

       (a) Establishment.--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 entities for the replacement of 
     existing school buses manufactured before model year 1991 
     with alternative fuel school buses and ultra-low sulfur 
     diesel fuel school buses.
       (b) Requirements.--
       (1) In general.--Not later than 90 days after the date of 
     enactment of this Act, the Administrator shall establish and 
     publish in the Federal Register grant requirements on 
     eligibility for assistance, and on implementation of the 
     program established under subsection (a), including 
     instructions for the submission of grant applications and 
     certification requirements to ensure compliance with this 
     subtitle.
       (2) Application deadlines.--The requirements established 
     under paragraph (1) shall require submission of grant 
     applications not later than--
       (A) in the case of the first year of program 
     implementation, the date that is 180 days after the 
     publication of the requirements in the Federal Register; and
       (B) in the case of each subsequent year, June 1 of the 
     year.
       (c) Eligible Recipients.--A grant shall be awarded under 
     this section only--
       (1) to 1 or more local or State governmental entities 
     responsible for providing school bus service to 1 or more 
     public school systems or responsible for the purchase of 
     school buses;
       (2) to 1 or more contracting entities that provide school 
     bus service to 1 or more public school systems, if the grant 
     application is submitted jointly with the 1 or more school 
     systems to be served by the buses, except that the 
     application may provide that buses purchased using funds 
     awarded shall be owned, operated, and maintained exclusively 
     by the 1 or more contracting entities; or
       (3) to a nonprofit school transportation association 
     representing private contracting entities, if the association 
     has notified and received approval from the 1 or more school 
     systems to be served by the buses.
       (d) Award Deadlines.--
       (1) In general.--Subject to paragraph (2), the 
     Administrator shall award a grant made to a qualified 
     applicant for a fiscal year--
       (A) in the case of the first fiscal year of program 
     implementation, not later than the date that is 90 days after 
     the application deadline established under subsection (b)(2); 
     and
       (B) in the case of each subsequent fiscal year, not later 
     than August 1 of the fiscal year.
       (2) Insufficient number of qualified grant applications.--
     If the Administrator does not receive a sufficient number of 
     qualified grant applications to meet the requirements of 
     subsection (i)(1) for a fiscal year, the Administrator shall 
     award a grant made to a qualified applicant under subsection 
     (i)(2) not later than September 30 of the fiscal year.
       (e) Types of Grants.--
       (1) In general.--A grant under this section shall be used 
     for the replacement of school buses manufactured before model 
     year 1991 with alternative fuel school buses and ultra-low 
     sulfur diesel fuel school buses.
       (2) No economic benefit.--Other than the receipt of the 
     grant, a recipient of a grant under this section may not 
     receive any economic benefit in connection with the receipt 
     of the grant.
       (3) Priority of grant applications.--The Administrator 
     shall give priority to applicants that propose to replace 
     school buses manufactured before model year 1977.
       (f) Conditions of Grant.--A grant provided under this 
     section shall include the following conditions:
       (1) School bus fleet.--All buses acquired with funds 
     provided under the grant shall be operated as part of the 
     school bus fleet for which the grant was made for a minimum 
     of 5 years.
       (2) Use of funds.--Funds provided under the grant may only 
     be used--
       (A) to pay the cost, except as provided in paragraph (3), 
     of new alternative fuel school buses or ultra-low sulfur 
     diesel fuel school buses, including State taxes and contract 
     fees associated with the acquisition of such buses; and
       (B) to provide--
       (i) up to 20 percent of the price of the alternative fuel 
     school buses acquired, for necessary alternative fuel 
     infrastructure if the infrastructure will only be available 
     to the grant recipient; and
       (ii) up to 25 percent of the price of the alternative fuel 
     school buses acquired, for necessary alternative fuel 
     infrastructure if the infrastructure will be available to the 
     grant recipient and to other bus fleets.
       (3) Grant recipient funds.--The grant recipient shall be 
     required to provide at least--
       (A) in the case of a grant recipient described in paragraph 
     (1) or (3) of subsection (c), the lesser of--
       (i) an amount equal to 15 percent of the total cost of each 
     bus received; or
       (ii) $15,000 per bus; and
       (B) in the case of a grant recipient described in 
     subsection (c)(2), the lesser of--
       (i) an amount equal to 20 percent of the total cost of each 
     bus received; or
       (ii) $20,000 per bus.
       (4) Ultra-low sulfur diesel fuel.--In the case of a grant 
     recipient receiving a grant for ultra-low sulfur diesel fuel 
     school buses, the grant recipient shall be required to 
     provide documentation to the satisfaction of the 
     Administrator that diesel fuel containing sulfur at not more 
     than 15 parts per million is available for carrying out the 
     purposes of the grant, and a commitment by the applicant to 
     use such fuel in carrying out the purposes of the grant.
       (5) Timing.--All alternative fuel school buses, ultra-low 
     sulfur diesel fuel school buses, or alternative fuel 
     infrastructure acquired under a grant awarded under this 
     section shall be purchased and placed in service as soon as 
     practicable.
       (g) Buses.--
       (1) In general.--Except as provided in paragraph (2), 
     funding under a grant made under this section for the 
     acquisition of new alternative fuel school buses or ultra-low 
     sulfur diesel fuel school buses shall only be used to acquire 
     school buses--
       (A) with a gross vehicle weight of greater than 14,000 
     pounds;
       (B) that are powered by a heavy duty engine;
       (C) in the case of alternative fuel school buses 
     manufactured in model years 2004

[[Page 7166]]

     through 2006, that emit not more than 1.8 grams per brake 
     horsepower-hour of nonmethane hydrocarbons and oxides of 
     nitrogen and .01 grams per brake horsepower-hour of 
     particulate matter; and
       (D) in the case of ultra-low sulfur diesel fuel school 
     buses manufactured in model years 2004 through 2006, that 
     emit not more than 2.5 grams per brake horsepower-hour of 
     nonmethane hydrocarbons and oxides of nitrogen and .01 grams 
     per brake horsepower-hour of particulate matter.
       (2) Limitations.--A bus shall not be acquired under this 
     section that emits nonmethane hydrocarbons, oxides of 
     nitrogen, or particulate matter at a rate greater than the 
     best performing technology of the same class of ultra-low 
     sulfur diesel fuel school buses commercially available at the 
     time the grant is made.
       (h) Deployment and Distribution.--The Administrator shall--
       (1) seek, to the maximum extent practicable, to achieve 
     nationwide deployment of alternative fuel school buses and 
     ultra-low sulfur diesel fuel school buses through the program 
     under this section; and
       (2) ensure a broad geographic distribution of grant awards, 
     with a goal of no State receiving more than 10 percent of the 
     grant funding made available under this section for a fiscal 
     year.
       (i) Allocation of Funds.--
       (1) In general.--Subject to paragraph (2), of the amount of 
     grant funding made available to carry out this section for 
     any fiscal year, the Administrator shall use--
       (A) 70 percent for the acquisition of alternative fuel 
     school buses or supporting infrastructure; and
       (B) 30 percent for the acquisition of ultra-low sulfur 
     diesel fuel school buses.
       (2) Insufficient number of qualified grant applications.--
     After the first fiscal year in which this program is in 
     effect, if the Administrator does not receive a sufficient 
     number of qualified grant applications to meet the 
     requirements of subparagraph (A) or (B) of paragraph (1) for 
     a fiscal year, effective beginning on August 1 of the fiscal 
     year, the Administrator shall make the remaining funds 
     available to other qualified grant applicants under this 
     section.
       (j) Reduction of School Bus Idling.--Each local educational 
     agency (as defined in section 9101 of the Elementary and 
     Secondary Education Act of 1965 (20 U.S.C. 7801)) that 
     receives Federal funds under the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6301 et seq.) is encouraged 
     to develop a policy, consistent with the health, safety, and 
     welfare of students and the proper operation and maintenance 
     of school buses, to reduce the incidence of unnecessary 
     school bus idling at schools when picking up and unloading 
     students.
       (k) Annual Report.--
       (1) In general.--Not later than January 31 of each year, 
     the Administrator shall transmit to Congress a report 
     evaluating implementation of the programs under this section 
     and section 743.
       (2) Components.--The reports shall include a description 
     of--
       (A) the total number of grant applications received;
       (B) the number and types of alternative fuel school buses, 
     ultra-low sulfur diesel fuel school buses, and retrofitted 
     buses requested in grant applications;
       (C) grants awarded and the criteria used to select the 
     grant recipients;
       (D) certified engine emission levels of all buses purchased 
     or retrofitted under the programs under this section and 
     section 743;
       (E) an evaluation of the in-use emission level of buses 
     purchased or retrofitted under the programs under this 
     section and section 743; and
       (F) any other information the Administrator considers 
     appropriate.
       (l) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Administrator to carry out this 
     section, to remain available until expended--
       (1) $45,000,000 for fiscal year 2005;
       (2) $65,000,000 for fiscal year 2006;
       (3) $90,000,000 for fiscal year 2007; and
       (4) such sums as are necessary for each of fiscal years 
     2008 and 2009.

     SEC. 743. DIESEL RETROFIT PROGRAM.

       (a) Establishment.--The Administrator, in consultation with 
     the Secretary, shall establish a program for awarding grants 
     on a competitive basis to entities for the installation of 
     retrofit technologies for diesel school buses.
       (b) Eligible Recipients.--A grant shall be awarded under 
     this section only--
       (1) to a local or State governmental entity responsible for 
     providing school bus service to 1 or more public school 
     systems;
       (2) to 1 or more contracting entities that provide school 
     bus service to 1 or more public school systems, if the grant 
     application is submitted jointly with the 1 or more school 
     systems that the buses will serve, except that the 
     application may provide that buses purchased using funds 
     awarded shall be owned, operated, and maintained exclusively 
     by the 1 or more contracting entities; or
       (3) to a nonprofit school transportation association 
     representing private contracting entities, if the association 
     has notified and received approval from the 1 or more school 
     systems to be served by the buses.
       (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, or particulate 
     matter per proposal or per bus; or
       (B) involve the use of emissions control retrofit 
     technology on diesel school buses that operate solely on 
     ultra-low sulfur diesel fuel.
       (d) Conditions of Grant.--A grant shall be provided under 
     this section on the conditions that--
       (1) buses 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 1991 or later; and
       (C) will be used for the transportation of school children 
     to and from school for a minimum of 5 years;
       (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 15 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.
       (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 verify--
       (1) the retrofit emissions-control technology to be 
     demonstrated;
       (2) that buses 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; and
       (3) 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--
       (1) $20,000,000 for fiscal year 2005;
       (2) $35,000,000 for fiscal year 2006;
       (3) $45,000,000 for fiscal year 2007; and
       (4) such sums as are necessary for each of fiscal years 
     2008 and 2009.

     SEC. 744. 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 2005 through 2007.

                       Subtitle D--Miscellaneous

     SEC. 751. RAILROAD EFFICIENCY.

       (a) Establishment.--The Secretary of Energy 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 of Energy to carry out 
     this section--
       (1) $25,000,000 for fiscal year 2006;
       (2) $35,000,000 for fiscal year 2007; and
       (3) $50,000,000 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

[[Page 7167]]

     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
       (6) 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; and
       (2) ways to promote fuel conservation measures for aviation 
     to--
       (A) enhance fuel efficiency; and
       (B) reduce 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 the emissions on human health.

     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 of Energy 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. 756. REDUCTION OF ENGINE IDLING OF HEAVY-DUTY VEHICLES.

       (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, and 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 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, and 
     electricity to the factory-installed components on a heavy-
     duty vehicle as if the main drive engine of the heavy-duty 
     vehicle were running; 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 12,500 
     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 device or system of 
     devices that--
       (A) is used to reduce long-duration idling of a heavy-duty 
     vehicle; and
       (B) allows for the main drive engine or auxiliary 
     refrigeration engine of a heavy-duty vehicle to be shut down.
       (6) Long-duration idling.--
       (A) In general.--The term ``long-duration idling'' means 
     the operation of a main drive engine or auxiliary 
     refrigeration engine of a heavy-duty vehicle, 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 of a heavy-duty vehicle 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 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 establish a 
     program to support deployment of idle reduction technology.
       (ii) Priority.--The Administrator shall give priority to 
     the deployment of idle reduction technology based on 
     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) $19,500,000 for fiscal year 2006, 
     $30,000,000 for fiscal year 2007, and $45,000,000 for fiscal 
     year 2008.
       (ii) Cost sharing.--Subject to clause (iii), 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.
       (iii) Necessary and appropriate reductions.--The 
     Administrator may reduce the non-Federal requirement under 
     clause (ii) if the Administrator determines that the 
     reduction is necessary and appropriate to meet the objectives 
     of this section.
       (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.

[[Page 7168]]

       (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 250 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 250-pound gross weight increase is not used for 
     any purpose other than the use of idle reduction technology 
     described in subparagraph (A).''.

     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. HIGH OCCUPANCY VEHICLE EXCEPTION.

       Notwithstanding section 102(a) of title 23, United States 
     Code, a State may permit a vehicle with fewer than 2 
     occupants to operate in high occupancy vehicle lanes if the 
     vehicle--
       (1) is a dedicated vehicle (as defined in section 301 of 
     the Energy Policy Act of 1992 (42 U.S. 13211)); or
       (2) is a hybrid vehicle (as defined by the State for the 
     purpose of this section).

     SEC. 759. ULTRA-EFFICIENT ENGINE TECHNOLOGY FOR AIRCRAFT.

       (a) Ultra-Efficient Engine Technology Partnership.--The 
     Secretary of Energy 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 of Energy shall 
     establish the following performance objectives for the 
     program set forth in subsection (a):
       (1) A fuel efficiency increase of 10 percent.
       (2) A reduction in the impact of landing and takeoff 
     nitrogen oxides emissions on local air quality of 70 percent.
       (c) Authorization of Appropriations .--There are authorized 
     to be appropriated to the Secretary of Energy for carrying 
     out this section $45,000,000 for each of the fiscal years 
     2006, 2007, 2008, 2009, and 2010.

                   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 $2,000,000 for each 
     of fiscal years 2006 through 2010.

     SEC. 772. REVISED CONSIDERATIONS FOR DECISIONS ON MAXIMUM 
                   FEASIBLE AVERAGE FUEL ECONOMY.

       Section 32902(f) of title 49, United States Code, is 
     amended to read as follows:
       ``(f) Considerations for Decisions on Maximum Feasible 
     Average Fuel Economy.--When deciding maximum feasible average 
     fuel economy under this section, the Secretary of 
     Transportation shall consider the following matters:
       ``(1) Technological feasibility.
       ``(2) Economic practicability.
       ``(3) The effect of other motor vehicle standards of the 
     Government on fuel economy.
       ``(4) The need of the United States to conserve energy.
       ``(5) The effects of fuel economy standards on passenger 
     automobiles, nonpassenger automobiles, and occupant safety.
       ``(6) The effects of compliance with average fuel economy 
     standards on levels of automobile industry employment in the 
     United States.''.

     SEC. 773. 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. 774. 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.

                          TITLE VIII--HYDROGEN

     SEC. 801. DEFINITIONS.

       In this title:
       (1) Advisory committee.--The term ``Advisory Committee'' 
     means the Hydrogen Technical and Fuel Cell Advisory Committee 
     established under section 805.
       (2) Department.--The term ``Department'' means the 
     Department of Energy.
       (3) Fuel cell.--The term ``fuel cell'' means a device that 
     directly converts the chemical energy of a fuel and an 
     oxidant into electricity by an electrochemical process taking 
     place at separate electrodes in the device.
       (4) Infrastructure.--The term ``infrastructure'' means the 
     equipment, systems, or facilities used to produce, 
     distribute, deliver, or store hydrogen.
       (5) Light duty vehicle.--The term ``light duty vehicle'' 
     means a car or truck classified by the Department of 
     Transportation as a Class I or IIA vehicle.
       (6) Secretary.--The term ``Secretary'' means the Secretary 
     of Energy.

     SEC. 802. 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 803(a);

[[Page 7169]]

       (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 803(b), 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. 803. PROGRAMS.

       (a) 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 on-site 
     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;
       (7) development, after consultation with the private 
     sector, of necessary codes and standards (including 
     international codes and standards and voluntary consensus 
     standards adopted in accordance with OMB Circular A-119) and 
     safety practices for the production, distribution, storage, 
     and use of hydrogen, hydrogen-carrier fuels, and related 
     products;
       (8) a public education program to develop improved 
     knowledge and acceptability of hydrogen-based systems; and
       (9) the ability of domestic automobile manufacturers to 
     manufacture commercially available competitive hybrid vehicle 
     technologies in the United States.
       (b) 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
       (B) to enable production, delivery, and acceptance by 
     consumers of model year 2020 hydrogen fuel cell and other 
     hydrogen-powered vehicles that will have--
       (i) a range of at least 300 miles;
       (ii) improved performance and ease of driving;
       (iii) safety and performance comparable to vehicle 
     technologies in the market; and
       (iv) when compared to light duty vehicles in model year 
     2003--

       (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, 
     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.
       (c) Demonstration.--In carrying out the programs under this 
     section, the Secretary shall fund a limited number of 
     demonstration projects, consistent with 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; 
     and
       (9) address applications specific to rural or remote 
     locations, including isolated villages and islands, the 
     National Park System, and tribal entities.

     The Secretary shall give preference to projects which address 
     multiple elements contained in paragraphs (1) through (9).
       (d) Deployment.--In carrying out the programs under this 
     section, the Secretary shall, in partnership with the private 
     sector, conduct activities to facilitate the deployment of 
     hydrogen energy and energy infrastructure, fuel cells, and 
     advanced vehicle technologies.
       (e) 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.
       (f) Cost Sharing.--
       (1) Research and development.--Except as otherwise provided 
     in this title, for research and development programs carried 
     out under this title the Secretary shall require a commitment 
     from non-Federal sources of at least 20 percent of the cost 
     of the project. The Secretary may reduce or eliminate the 
     non-Federal requirement under this paragraph if the Secretary 
     determines that the research and development is of a basic or 
     fundamental nature or involves technical analyses or 
     educational activities.
       (2) Demonstration and commercial application.--Except as 
     otherwise provided in this title, the Secretary shall require 
     at least 50 percent of the costs directly and specifically 
     related to any demonstration or commercial application 
     project under this title to be provided from non-Federal 
     sources. The Secretary may reduce the non-Federal requirement 
     under this paragraph if the Secretary determines that the 
     reduction is necessary and appropriate considering the 
     technological risks involved in the project and is necessary 
     to meet the objectives of this title.
       (3) Calculation of amount.--In calculating the amount of 
     the non-Federal commitment under paragraph (1) or (2), the 
     Secretary may include personnel, services, equipment, and 
     other resources.
       (4) Size of non-federal share.--The Secretary may consider 
     the size of the non-Federal share in selecting projects.
       (g) Disclosure.--Section 623 of the Energy Policy Act of 
     1992 (42 U.S.C. 13293) relating to the protection of 
     information shall apply to projects carried out through 
     grants, cooperative agreements, or contracts under this 
     title.

     SEC. 804. INTERAGENCY 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.--

[[Page 7170]]

       (1) Planning.--The interagency 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 interagency task force may organize 
     workshops and conferences, may issue publications, and may 
     create databases to carry out its duties. The interagency 
     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 
     interagency task force, shall cooperate with and furnish 
     information to the interagency task force, the Advisory 
     Committee, and the Department.

     SEC. 805. 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 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 committee members and the needs of 
     the Advisory Committee.
       (2) Terms.--The term of a member of the Advisory Committee 
     shall not be more than 3 years. The Secretary may appoint 
     members of the 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 Advisory Committee. A member of the Advisory Committee 
     whose term is expiring may be reappointed.
       (3) Chairperson.--The Advisory Committee shall have a 
     chairperson, who is elected by the members from among their 
     number.
       (c) Review.--The 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 802.
       (d) Response.--
       (1) Consideration of recommendations.--The Secretary shall 
     consider, but need not adopt, any recommendations of the 
     Advisory Committee under subsection (c).
       (2) Biennial report.--The Secretary shall transmit a 
     biennial report to Congress describing any recommendations 
     made by the 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 Advisory 
     Committee to carry out its responsibilities under this title.

     SEC. 806. EXTERNAL REVIEW.

       (a) Plan.--The Secretary shall enter into an arrangement 
     with the National Academy of Sciences to review the plan 
     prepared under section 802, which shall be completed not 
     later than 6 months after the Academy receives the plan. 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 of 
     the reasons that a recommendation will not be implemented.
       (b) Additional Review.--The Secretary shall enter into an 
     arrangement with the National Academy of Sciences under which 
     the Academy will review the programs under section 803 during 
     the fourth year following the date of enactment of this Act. 
     The Academy's review shall include the research priorities 
     and technical milestones, and evaluate the progress toward 
     achieving them. The 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.

     SEC. 807. 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. 808. 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.

     SEC. 809. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated to the Secretary to 
     carry out this title, in addition to any amounts made 
     available for these purposes under other Acts--
       (1) $546,000,000 for fiscal year 2006;
       (2) $750,000,000 for fiscal year 2007;
       (3) $850,000,000 for fiscal year 2008;
       (4) $900,000,000 for fiscal year 2009; and
       (5) $1,000,000,000 for fiscal year 2010.

     SEC. 810. SOLAR AND WIND TECHNOLOGIES.

       (a) Solar Energy Technologies.--The Secretary shall--
       (1) prepare a detailed roadmap for carrying out the 
     provisions in this subtitle related to solar energy 
     technologies and for implementing the recommendations related 
     to solar energy technologies that are included in the report 
     transmitted under subsection (c);
       (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 research and development 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 
     of Energy'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 research programs 
     dedicated to the development and advancement of concentrating 
     solar power devices; and
       (7) establish a program--
       (A) to research and 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

[[Page 7171]]

       (C) to research 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 subtitle related to wind energy 
     technologies and for implementing the recommendations related 
     to wind energy technologies that are included in the report 
     transmitted under subsection (c); 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 research 
     programs at institutions of higher education for the 
     development of solar energy technologies and wind energy 
     technologies for the production of hydrogen. The research 
     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 of Energy.
       (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) 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 ``institution of higher education'' has the 
     meaning given to that term in section 101(a) of the Higher 
     Education Act of 1965 (20 U.S.C. 1001(a));
       (3) 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);
       (4) 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
       (5) the term ``photovoltaic devices'' means devices that 
     convert light directly into electricity through a solid-
     state, semiconductor process.

                   TITLE IX--RESEARCH AND DEVELOPMENT

     SEC. 900. SHORT TITLE; DEFINITIONS.

       (a) Short Title.--This title may be cited as the ``Energy 
     Research, Development, Demonstration, and Commercial 
     Application Act of 2005''.
       (b) Definitions.--For purposes of this title:
       (1) Applied programs.--The term ``applied programs'' means 
     the research, development, demonstration, and commercial 
     application programs of the Department concerning energy 
     efficiency, renewable energy, nuclear energy, fossil energy, 
     and electricity transmission and distribution.
       (2) 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.
       (3) Department.--The term ``Department'' means the 
     Department of Energy.
       (4) Departmental mission.--The term ``departmental 
     mission'' means any of the functions vested in the Secretary 
     of Energy by the Department of Energy Organization Act (42 
     U.S.C. 7101 et seq.) or other law.
       (5) Institution of higher education.--The term 
     ``institution of higher education'' has the meaning given 
     that term in section 101(a) of the Higher Education Act of 
     1965 (20 U.S.C. 1001(a)).
       (6) 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.
       (7) Renewable energy.--The term ``renewable energy'' means 
     energy from wind, sunlight, the flow of water, heat from the 
     Earth, or biomass that can be converted into a usable form 
     such as process heat, electricity, fuel, or space heat.
       (8) Secretary.--The term ``Secretary'' means the Secretary 
     of Energy.
       (9) State.--The term ``State'' means any of the several 
     States, the District of Columbia, the Commonwealth of Puerto 
     Rico, the United States Virgin Islands, Guam, American Samoa, 
     the Northern Mariana Islands, and any other commonwealth, 
     territory, or possession of the United States.
       (10) 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).
       (11) User facility.--The term ``user facility'' means a 
     research and development facility supported, in whole or in 
     part, by Departmental funds that is open, at a minimum, to 
     all qualified United States researchers.

                      Subtitle A--Science Programs

     SEC. 901. OFFICE OF SCIENCE PROGRAMS.

       (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) Rare Isotope Accelerator.--
       (1) Establishment.--The Secretary shall construct and 
     operate a Rare Isotope Accelerator. The Secretary shall 
     commence construction no later than September 30, 2008.
       (2) Authorization of appropriations.--There are authorized 
     to be appropriated to the Secretary such sums as may be 
     necessary to carry out this subsection. 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.

     SEC. 902. SYSTEMS BIOLOGY PROGRAM.

       (a) Program.--
       (1) Establishment.--The Secretary shall establish a 
     research, development, and demonstration program in genetics, 
     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 Departmental 
     facilities, 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.

[[Page 7172]]

       (d) User Facilities and Ancillary Equipment.--Within the 
     funds authorized to be appropriated pursuant to this 
     subtitle, the amounts specified under section 910(b)(1), 
     (c)(1), (d)(1), (e)(1), and (f)(1) shall be available for 
     projects to develop, plan, construct, acquire, or operate 
     special equipment, instrumentation, or facilities, including 
     user facilities, 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. 903. CATALYSIS RESEARCH AND DEVELOPMENT PROGRAM.

       (a) Establishment.--The Secretary shall conduct a program 
     of research and development in catalysis science, including 
     efforts to--
       (1) enable molecular-level catalyst design by coupling 
     experimental and computational approaches;
       (2) enable nanoscale, high-throughput synthesis, assay, and 
     characterization; and
       (3) synthesize catalysts with specific site architectures.
       (b) Program Activities.--In carrying out the program under 
     this section, the Secretary shall--
       (1) support both individual researchers and 
     multidisciplinary teams of researchers to pioneer new 
     approaches in catalytic design;
       (2) develop, plan, construct, acquire, or operate special 
     equipment or facilities, including user facilities;
       (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.

     SEC. 904. HYDROGEN.

       The Secretary shall conduct a program of fundamental 
     research and development in support of programs authorized in 
     titleVIII.

     SEC. 905. ADVANCED SCIENTIFIC COMPUTING RESEARCH.

        The Secretary shall conduct an advanced scientific 
     computing research and development program, including in 
     applied mathematics and the activities authorized by the 
     Department of Energy High-End Computing Revitalization Act of 
     2004 (15 U.S.C. 5541 et seq.). The Secretary shall carry out 
     this program with the goal of supporting departmental 
     missions and providing the high-performance computational, 
     networking, and workforce resources that are required for 
     world leadership in science.

     SEC. 906. FUSION ENERGY SCIENCES PROGRAM.

       (a) Declaration of Policy.--It shall be the policy of the 
     United States to conduct research, development, 
     demonstration, and commercial application to provide for the 
     scientific, engineering, and commercial infrastructure 
     necessary to ensure that the United States is competitive 
     with other nations in providing fusion energy for its own 
     needs and the needs of other nations, including by 
     demonstrating electric power or hydrogen production for the 
     United States energy grid utilizing fusion energy at the 
     earliest date possible.
       (b) Planning.--
       (1) In general.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary shall transmit 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). The 
     plan shall ensure that--
       (A) existing fusion research facilities are more fully 
     utilized;
       (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, cost effectiveness, and their potential to 
     advance the goal of practical fusion energy at the earliest 
     date possible, and those that are selected are funded at a 
     cost-effective rate;
       (D) communication of scientific results and methods between 
     the fusion energy science community and the broader 
     scientific and technology communities is improved;
       (E) inertial confinement fusion facilities are utilized to 
     the extent practicable for the purpose of inertial fusion 
     energy research and development; and
       (F) attractive alternative inertial and magnetic fusion 
     energy approaches are more fully explored.
       (2) Costs and schedules.--Such plan shall also address the 
     status of and, to the degree possible, 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) In general.--The United States may participate in ITER 
     only in accordance with this subsection.
       (2) Agreement.--
       (A) In general.--The Secretary is authorized to negotiate 
     an agreement for United States participation in ITER.
       (B) Contents.--Any agreement for United States 
     participation in 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 the project;
       (ii) ensure that the share of ITER's high-technology 
     components manufactured in the United States is at least 
     proportionate to the United States financial contribution to 
     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 ITER;
       (v) enable United States researchers to propose and carry 
     out an equitable share of the experiments at ITER;
       (vi) provide the United States with a role in all 
     collective decisionmaking related to ITER; and
       (vii) describe the process for discontinuing or 
     decommissioning ITER and any United States role in that 
     process.
       (3) Plan.--The Secretary, in consultation with the Fusion 
     Energy Sciences Advisory Committee, shall develop a plan for 
     the participation of United States scientists in ITER that 
     shall include the United States research agenda for ITER, 
     methods to evaluate whether ITER is promoting progress toward 
     making fusion a reliable and affordable source of power, and 
     a description of how work at ITER will relate to other 
     elements of the United States fusion program. The Secretary 
     shall request a review of the plan by the National Academy of 
     Sciences.
       (4) Limitation.--No Federal funds shall be expended for the 
     construction of ITER until the Secretary has transmitted to 
     Congress--
       (A) the agreement negotiated pursuant to paragraph (2) and 
     120 days have elapsed since that transmission;
       (B) a report describing the management structure of ITER 
     and providing a fixed dollar estimate of the cost of United 
     States participation in the construction of ITER, and 120 
     days have elapsed since that transmission;
       (C) a report describing how United States participation in 
     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 transmission; 
     and
       (D) the plan required by paragraph (3) (but not the 
     National Academy of Sciences review of that plan), and 60 
     days have elapsed since that transmission.
       (5) Alternative to iter.--If at any time during the 
     negotiations on ITER, the Secretary determines that 
     construction and operation of ITER is unlikely or infeasible, 
     the Secretary shall send to Congress, as part of the budget 
     request for the following year, a plan for implementing a 
     domestic burning plasma experiment including costs and 
     schedules for such a plan. The Secretary shall refine such 
     plan in full consultation with the Fusion Energy Sciences 
     Advisory Committee and shall also transmit such plan to the 
     National Academy of Sciences for review.
       (6) Definitions.--In this subsection:
       (A) Construction.-- The term ``construction'' means the 
     physical construction of the ITER facility, and the physical 
     construction, purchase, or manufacture of equipment or 
     components that are specifically designed for the ITER 
     facility, but does not mean 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.

     SEC. 907. SCIENCE AND TECHNOLOGY SCHOLARSHIP PROGRAM.

       (a) Establishment of Program.--
       (1) 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.
       (2) Competitive process.--Individuals shall be selected to 
     receive scholarships under this section through a competitive 
     process primarily on the basis of academic merit, 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 or 1885b).
       (3) Service agreements.--To carry out the Program the 
     Secretary shall enter into contractual agreements with 
     individuals selected under paragraph (2) under which the

[[Page 7173]]

     individuals agree to serve as full-time employees of the 
     Department, for the period described in subsection (f)(1), in 
     positions needed by the Department and for which the 
     individuals are qualified, in exchange for receiving a 
     scholarship.
       (b) Scholarship Eligibility.--In order to be eligible to 
     participate in the Program, an individual must--
       (1) be enrolled or accepted for enrollment as a full-time 
     graduate student at an institution of higher education in an 
     academic program or field of study described in the list made 
     available under subsection (d);
       (2) be a United States citizen; and
       (3) at the time of the initial scholarship award, not be a 
     Federal employee as defined in section 2105 of title 5 of the 
     United States Code.
       (c) Application Required.--An individual seeking a 
     scholarship under this section shall submit an application to 
     the Secretary at such time, in such manner, and containing 
     such information, agreements, or assurances as the Secretary 
     may require.
       (d) Eligible Academic Programs.--The Secretary shall make 
     publicly available a list of academic programs and fields of 
     study for which scholarships under the Program may be 
     utilized, and shall update the list as necessary.
       (e) Scholarship Requirement.--
       (1) In general.--The Secretary may provide a scholarship 
     under the Program for an academic year if the individual 
     applying for the scholarship has submitted to the Secretary, 
     as part of the application required under subsection (c), a 
     proposed academic program leading to a degree in a program or 
     field of study on the list made available under subsection 
     (d).
       (2) Duration of eligibility.--An individual may not receive 
     a scholarship under this section for more than 4 academic 
     years, unless the Secretary grants a waiver.
       (3) Scholarship amount.--The dollar amount of a scholarship 
     under this section for an academic year shall be determined 
     under regulations issued by the Secretary, but shall in no 
     case exceed the cost of attendance.
       (4) Authorized uses.--A scholarship provided under this 
     section may be expended for tuition, fees, and other 
     authorized expenses as established by the Secretary by 
     regulation.
       (5) Contracts regarding direct payments to institutions.--
     The Secretary may enter into a contractual agreement with an 
     institution of higher education under which the amounts 
     provided for a scholarship under this section for tuition, 
     fees, and other authorized expenses are paid directly to the 
     institution with respect to which the scholarship is 
     provided.
       (f) Period of Obligated Service.--
       (1) Duration of service.--The period of service for which 
     an individual shall be obligated to serve as an employee of 
     the Department is, except as provided in subsection (h)(2), 
     24 months for each academic year for which a scholarship 
     under this section is provided.
       (2) Schedule for service.--
       (A) In general.--Except as provided in subparagraph (B), 
     obligated service under paragraph (1) shall begin not later 
     than 60 days after the individual obtains the educational 
     degree for which the scholarship was provided.
       (B) Deferral.--The Secretary may defer the obligation of an 
     individual to provide a period of service under paragraph (1) 
     if the Secretary determines that such a deferral is 
     appropriate. The Secretary shall prescribe the terms and 
     conditions under which a service obligation may be deferred 
     through regulation.
       (g) Penalties for Breach of Scholarship Agreement.--
       (1) Failure to complete academic training.--Scholarship 
     recipients who fail to maintain a high level of academic 
     standing, as defined by the Secretary by regulation, who are 
     dismissed from their educational institutions for 
     disciplinary reasons, or who voluntarily terminate academic 
     training before graduation from the educational program for 
     which the scholarship was awarded, shall be in breach of 
     their contractual agreement and, in lieu of any service 
     obligation arising under such agreement, shall be liable to 
     the United States for repayment not later than 1 year after 
     the date of default of all scholarship funds paid to them and 
     to the institution of higher education on their behalf under 
     the agreement, except as provided in subsection (h)(2). The 
     repayment period may be extended by the Secretary when 
     determined to be necessary, as established by regulation.
       (2) Failure to begin or complete the service obligation or 
     meet the terms and conditions of deferment.--A scholarship 
     recipient who, for any reason, fails to begin or complete a 
     service obligation under this section after completion of 
     academic training, or fails to comply with the terms and 
     conditions of deferment established by the Secretary pursuant 
     to subsection (f)(2)(B), shall be in breach of the 
     contractual agreement. When a recipient breaches an agreement 
     for the reasons stated in the preceding sentence, the 
     recipient shall be liable to the United States for an amount 
     equal to--
       (A) the total amount of scholarships received by such 
     individual under this section; plus
       (B) the interest on the amounts of such awards which would 
     be payable if at the time the awards were received they were 
     loans bearing interest at the maximum legal prevailing rate, 
     as determined by the Treasurer of the United States,
     multiplied by 3.
       (h) Waiver or Suspension of Obligation.--
       (1) Death of individual.--Any obligation of an individual 
     incurred under the Program (or a contractual agreement 
     thereunder) for service or payment shall be canceled upon the 
     death of the individual.
       (2) Impossibility or extreme hardship.--The Secretary shall 
     by regulation provide for the partial or total waiver or 
     suspension of any obligation of service or payment incurred 
     by an individual under the Program (or a contractual 
     agreement thereunder) whenever compliance by the individual 
     is impossible or would involve extreme hardship to the 
     individual, or if enforcement of such obligation with respect 
     to the individual would be contrary to the best interests of 
     the Government.
       (i) Definitions.--In this section the following definitions 
     apply:
       (1) Cost of attendance.--The term ``cost of attendance'' 
     has the meaning given that term in section 472 of the Higher 
     Education Act of 1965 (20 U.S.C. 1087ll).
       (2) Program.--The term ``Program'' means the Science and 
     Technology Scholarship Program established under this 
     section.

     SEC. 908. OFFICE OF SCIENTIFIC AND TECHNICAL INFORMATION.

       The Secretary shall maintain within the Department the 
     Office of Scientific and Technical Information.

     SEC. 909. SCIENCE AND ENGINEERING PILOT PROGRAM.

       (a) Establishment of Consortium.--Notwithstanding section 
     913, the Secretary shall award a grant to Oak Ridge 
     Associated Universities to establish a university consortium 
     to carry out a regional pilot program for enhancing 
     scientific, technological, engineering, and mathematical 
     literacy, creativity, and decisionmaking. The consortium 
     shall include leading research universities, one or more 
     universities that train substantial numbers of elementary and 
     secondary school teachers, and, where appropriate, National 
     Laboratories.
       (b) Program Elements.--The 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 one 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 country.
       (c) Report.--Not later than 2 years after appropriations 
     are first available for the program, the Secretary shall 
     transmit to Congress a report outlining lessons learned and 
     containing a plan for expanding the program nationwide. The 
     Secretary may begin implementation of such plan for expansion 
     of the program on October 1, 2008. The expansion of the 
     program shall be subject to section 913.

     SEC. 910. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--In addition to amounts authorized to be 
     appropriated under the 21st Century Nanotechnology Research 
     and Development Act (15 U.S.C. 7501 et seq.) and the 
     Department of Energy High-End Computing Revitalization Act of 
     2004 (15 U.S.C. 5541 et seq.), the following sums are 
     authorized to be appropriated to the Secretary for the 
     purposes of carrying out this subtitle:
       (1) For fiscal year 2006, $3,785,000,000.
       (2) For fiscal year 2007, $4,153,000,000.
       (3) For fiscal year 2008, $4,628,000,000.
       (4) For fiscal year 2009, $5,300,000,000.
       (5) For fiscal year 2010, $5,800,000,000.
       (b) 2006 Allocations.--From amounts authorized under 
     subsection (a)(1), the following sums are authorized for 
     fiscal year 2006:
       (1) Systems biology.--For activities under section 902, 
     $100,000,000.
       (2) Scientific computing.--For activities under section 
     905, $252,000,000.
       (3) Fusion energy sciences.--For activities under section 
     906, excluding activities under subsection (c) of that 
     section, $335,000,000.
       (4) Scholarship.--For the scholarship program described in 
     section 907, $800,000.
       (5) Office of scientific and technical information.--For 
     activities under section 908, $7,000,000.
       (6) Pilot program.--For activities under section 909, 
     $4,000,000.
       (c) 2007 Allocations.--From amounts authorized under 
     subsection (a)(2), the following sums are authorized for 
     fiscal year 2007:

[[Page 7174]]

       (1) Systems biology.--For activities under section 902, 
     such sums as may be necessary.
       (2) Scientific computing.--For activities under section 
     905, $270,000,000.
       (3) Fusion energy sciences.--For activities under section 
     906, excluding activities under subsection (c) of that 
     section, $349,000,000.
       (4) Scholarship.--For the scholarship program described in 
     section 907, $1,600,000.
       (5) Office of scientific and technical information.--For 
     activities under section 908, $7,500,000.
       (6) Pilot program.--For activities under section 909, 
     $4,000,000.
       (d) 2008 Allocations.--From amounts authorized under 
     subsection (a)(3), the following sums are authorized for 
     fiscal year 2008:
       (1) Systems biology.--For activities under section 902, 
     such sums as may be necessary.
       (2) Scientific computing.--For activities under section 
     905, $350,000,000.
       (3) Fusion energy sciences.--For activities under section 
     906, excluding activities under subsection (c) of that 
     section, $362,000,000.
       (4) Scholarship.--For the scholarship program described in 
     section 907, $2,000,000.
       (5) Office of scientific and technical information.--For 
     activities under section 908, $8,000,000.
       (6) Pilot program.--For activities under section 909, 
     $4,000,000.
       (e) 2009 Allocations.--From amounts authorized under 
     subsection (a)(4), the following sums are authorized for 
     fiscal year 2009:
       (1) Systems biology.--For activities under section 902, 
     such sums as may be necessary.
       (2) Scientific computing.--For activities under section 
     905, $375,000,000.
       (3) Fusion energy sciences.--For activities under section 
     906, excluding activities under subsection (c) of that 
     section, $377,000,000.
       (4) Scholarship.--For the scholarship program described in 
     section 907, $2,000,000.
       (5) Office of scientific and technical information.--For 
     activities under section 908, $8,000,000.
       (6) Pilot program.--For activities under section 909, 
     $8,000,000.
       (f) 2010 Allocations.--From amounts authorized under 
     subsection (a)(5), the following sums are authorized for 
     fiscal year 2010:
       (1) Systems biology.--For activities under section 902, 
     such sums as may be necessary.
       (2) Scientific computing.--For activities under section 
     905, $400,000,000.
       (3) Fusion energy sciences.--For activities under section 
     906, excluding activities under subsection (c) of that 
     section, $393,000,000.
       (4) Scholarship.--For the scholarship program described in 
     section 907, $2,000,000.
       (5) Office of scientific and technical information.--For 
     activities under section 908, $8,500,000.
       (6) Pilot program.--For activities under section 909, 
     $8,000,000.
       (g) ITER Construction.--From amounts authorized under 
     subsection (a) and in addition to amounts authorized under 
     subsections (b)(3), (c)(3), (d)(3), (e)(3), and (f)(3), there 
     are authorized to be appropriated to the Secretary such sums 
     as may be necessary for ITER construction, consistent with 
     the limitations of section 906(c).

           Subtitle B--Research Administration and Operations

     SEC. 911. COST SHARING.

       (a) Research and Development.--Except as otherwise provided 
     in this title, for research and development programs carried 
     out under this title, the Secretary shall require a 
     commitment from non-Federal sources of at least 20 percent of 
     the cost of the project. The Secretary may reduce or 
     eliminate the non-Federal requirement under this subsection 
     if the Secretary determines that the research and development 
     is of a basic or fundamental nature.
       (b) Demonstration and Commercial Application.--Except as 
     otherwise provided in this title, the Secretary shall require 
     at least 50 percent of the costs related to any demonstration 
     or commercial application activities under this title to be 
     provided from non-Federal sources. The Secretary may reduce 
     the non-Federal requirement under this subsection if the 
     Secretary determines that the reduction is necessary and 
     appropriate considering the technological risks involved in 
     the project and is necessary to meet the objectives of this 
     title.
       (c) Calculation of Amount.--In calculating the amount of 
     the non-Federal commitment under subsection (a) or (b), the 
     Secretary may include personnel, services, equipment, and 
     other resources.
       (d) Size of Non-Federal Share.--The Secretary may consider 
     the amount of the non-Federal share in selecting projects 
     under this title.

     SEC. 912. REPROGRAMMING.

       (a) Distribution Report.--Not later than 60 days after the 
     date of enactment of an Act appropriating amounts authorized 
     under this title, the Secretary shall transmit to Congress a 
     report explaining how such amounts will be distributed among 
     the activities authorized by this title.
       (b) Reprogramming Letter.--No amount authorized by this 
     title shall be obligated or expended for a purpose 
     inconsistent with the appropriations Act appropriating such 
     amount, the report accompanying such appropriations Act, or a 
     distribution report transmitted under subsection (a) if such 
     obligation or expenditure would change an individual amount, 
     as represented in such an Act, report, or distribution 
     report, by more than 2 percent or $2,000,000, whichever is 
     smaller, unless the Secretary has transmitted to Congress a 
     letter of explanation and a period of 30 days has elapsed 
     after Congress receives the letter.
       (c) Computation.--The computation of the 30-day period 
     described in subsection (b) shall exclude any day on which 
     either House of Congress is not in session because of an 
     adjournment of more than 3 days to a day certain.

     SEC. 913. MERIT-BASED COMPETITION.

       (a) Competitive Merit Review.--Awardees of funds authorized 
     under this title shall be selected through open competitions. 
     Funds shall be competitively awarded only after an impartial 
     review of the scientific and technical merit of the proposals 
     for such awards has been carried out by or for the Department 
     on the basis of criteria outlined by the Secretary in the 
     solicitation of proposals.
       (b) Competition.--Competitive awards under this title shall 
     involve competitions open to all qualified entities within 
     one 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) Congressional Notification.--The Secretary shall notify 
     Congress within 30 days after awarding more than $500,000 
     through a competition described in subsection (b) that is 
     limited to 1 of the categories described in paragraphs (1) 
     through (4) of subsection (b).
       (d) Waivers.--The Secretary may waive the requirement under 
     subsection (a) requiring competition if the Secretary 
     considers it necessary to more quickly advance research, 
     development, demonstration, or commercial application 
     activities. The Secretary shall notify Congress within 30 
     days when a waiver is granted under this subsection. The 
     Secretary may not delegate the waiver authority under this 
     subsection for awards over $500,000.

     SEC. 914. EXTERNAL TECHNICAL REVIEW OF DEPARTMENTAL PROGRAMS.

       (a) National Applied Energy Research and Development 
     Advisory Committees.--
       (1) In general.--The Secretary shall establish one or more 
     advisory committees to review and advise the Department's 
     applied programs in the following areas:
       (A) Energy efficiency.
       (B) Renewable energy.
       (C) Nuclear energy.
       (D) Fossil energy.
       (2) Existing advisory committees.--The Secretary may 
     designate an existing advisory committee within the 
     Department to fulfill the responsibilities of an advisory 
     committee under this subsection.
       (b) Office of Science Advisory Committees.--
       (1) Use of existing committees.--Except as otherwise 
     provided under the Federal Advisory Committee Act, 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.
       (2) Report.--Before the Department issues any new guidance 
     regarding the membership for Office of Science scientific 
     program advisory committees, the Secretary shall transmit a 
     report to the Congress outlining the reasons for the proposed 
     changes, and 60 days must have elapsed after transmittal of 
     the report before the Department may implement those changes.
       (3) Science advisory committee.--
       (A) Establishment.--There shall be a Science Advisory 
     Committee for the Office of Science that includes the chairs 
     of each of the advisory committees described in paragraph 
     (1).
       (B) Responsibilities.--The Science Advisory Committee 
     shall--
       (i) advise the Director of the Office of Science on science 
     issues;
       (ii) advise the Director of the Office of Science with 
     respect to the well-being and management of the National 
     Laboratories and Department research facilities;
       (iii) advise the Director of the Office of Science with 
     respect to education and workforce training activities 
     required for effective short-term and long-term basic and 
     applied research activities of the Office of Science; and
       (iv) advise the Director of the Office of Science with 
     respect to the well-being of the university research programs 
     supported by the Office of Science.
       (c) Membership.--Each member of an advisory committee 
     appointed under this section shall have significant 
     scientific, technical, or other appropriate expertise. The 
     membership of each committee shall represent a wide range of 
     expertise, including, to the extent practicable, members with 
     expertise from outside the disciplines covered by the 
     program, and a diverse set of interests.
       (d) Meetings and Purposes.--Each advisory committee under 
     this section shall

[[Page 7175]]

     meet at least semiannually to review and advise on the 
     progress made by the respective research, development, 
     demonstration, and commercial application program or 
     programs. The advisory committee shall also review the 
     measurable cost and performance-based goals for the applied 
     programs, and the progress on meeting such goals.
       (e) Review and Assessment.--Not later than 6 months after 
     the date of enactment of this Act, the Secretary shall enter 
     into arrangements with the National Academy of Sciences to 
     conduct reviews and assessments of the programs authorized by 
     this title, the measurable cost and performance-based goals 
     for the applied programs, and the progress in meeting such 
     goals. Such reviews and assessments shall be completed and 
     reports containing the results of all such reviews and 
     assessments transmitted to the Congress not later than 2 
     years after the date of enactment of this Act.

     SEC. 915. 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), (O) of section 
     900(b)(6)), 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 the 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. 916. NATIONAL LABORATORY DESIGNATION.

       After the date of enactment of this Act the Secretary shall 
     not designate a facility that is not referred to in section 
     900(b)(6) as a National Laboratory.

     SEC. 917. 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 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 laboratories;
       (3) a description of how equal employment opportunity 
     practices at the 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 
     laboratory;
       (5) a summary of outreach efforts to attract women and 
     minorities to the laboratories;
       (6) a summary of efforts to retain women and minorities in 
     the laboratories; and
       (7) a summary of collaboration efforts with the Office of 
     Federal Contract Compliance Programs to improve equal 
     employment opportunity practices at the laboratories.

     SEC. 918. USER FACILITY BEST PRACTICES PLAN.

        The Secretary shall not allow any Department facility to 
     begin functioning as a user facility after the date of 
     enactment of this Act until the Secretary, for that 
     facility--
       (1) develops a plan to ensure that the facility will--
       (A) have a skilled staff to support a wide range of users;
       (B) have a fair method for allocating time to users that 
     provides for input from facility management, user 
     representatives, and outside experts; and
       (C) be operated in a safe and fiscally prudent manner; and
       (2) transmits such plan to Congress and 60 days have 
     elapsed.

     SEC. 919. SUPPORT FOR SCIENCE AND ENERGY INFRASTRUCTURE AND 
                   FACILITIES.

       (a) Strategy.--The Secretary shall develop and implement a 
     strategy for infrastructure and facilities supported 
     primarily from the Office of Science and the applied programs 
     at each National Laboratory and Department research facility. 
     Such strategy shall provide cost-effective means for--
       (1) maintaining existing facilities and infrastructure, as 
     needed;
       (2) closing unneeded facilities;
       (3) making facility modifications; and
       (4) building new facilities.
       (b) Report.--
       (1) Requirement.--The Secretary shall prepare and transmit 
     to the Congress not later than June 1, 2007, a report 
     summarizing the strategies developed under subsection (a).
       (2) Contents.--For each National Laboratory and Department 
     research facility, for the facilities primarily used for 
     science and energy research, such 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. 920. COORDINATION PLAN.

       (a) In General.--The Secretary shall develop a coordination 
     plan to improve coordination and collaboration in research, 
     development, demonstration, and commercial application 
     activities across Department organizational boundaries.
       (b) Plan Contents.--The plan shall describe--
       (1) how the Secretary will ensure that the applied programs 
     are coordinating their activities, including a description of 
     specific research questions that cross organizational 
     boundaries and of how the relevant applied programs are 
     coordinating their efforts to answer those questions, and how 
     such cross-cutting research questions will be identified in 
     the future;
       (2) how the Secretary will ensure that research that has 
     been supported by the Office of Science is being or will be 
     used by the applied programs, including a description of 
     specific Office of Science-supported research that is 
     relevant to the applied programs and of how the applied 
     programs have used or will use that research; and
       (3) a description of how the Secretary will ensure that the 
     research agenda of the Office of Science includes research 
     questions of concern to the applied programs, including a 
     description of specific research questions that the Office of 
     Science will address to assist the applied programs.
       (c) Plan Transmittal.--The Secretary shall transmit the 
     coordination plan to Congress not later than 9 months after 
     the date of enactment of this Act, and every 2 years 
     thereafter shall transmit a revised coordination plan.
       (d) Conference.--Not less than 6 months after the date of 
     enactment of this Act, the Secretary shall convene a 
     conference of program managers from the Office of Science and 
     the applied programs to review ideas and explore 
     possibilities for effective cross-program collaboration. The 
     Secretary also shall invite participation relevant Federal 
     agencies and other programs in the Federal Government 
     conducting relevant research, and other stakeholders as 
     appropriate.

     SEC. 921. AVAILABILITY OF FUNDS.

       Funds appropriated to the Secretary for activities 
     authorized under this title shall remain available for three 
     years. Funds that are not obligated at the end of three years 
     shall be returned to the Treasury.

                     Subtitle C--Energy Efficiency

             CHAPTER 1--VEHICLES, BUILDINGS, AND INDUSTRIES

     SEC. 922. PROGRAMS.

       (a) In General.--The Secretary shall conduct programs of 
     energy efficiency research, development, demonstration, and 
     commercial application, including activities described in 
     this chapter. Such programs shall be focused on the following 
     objectives:
       (1) Increasing the energy efficiency of vehicles, 
     buildings, and industrial processes.
       (2) Reducing the Nation's demand for energy, especially 
     energy from foreign sources.
       (3) Reducing the cost of energy and making the economy more 
     efficient and competitive.
       (4) Improving the Nation's energy security.
       (5) Reducing the environmental impact of energy-related 
     activities.
       (b) Goals.--
       (1) Initial goals.--In accordance with the performance plan 
     and report requirements in section 4 of the Government 
     Performance Results Act of 1993, the Secretary shall transmit 
     to the Congress, along with the President's annual budget 
     request for fiscal year 2007, a report containing outcome 
     measures with explicitly stated cost and performance 
     baselines. The measures shall specify energy efficiency 
     performance goals, with quantifiable 5-year cost and energy 
     savings target levels, for vehicles, buildings, and 
     industries, and any other such goals the Secretary considers 
     appropriate.
       (2) Subsequent transmittals.--The Secretary shall transmit 
     to the Congress, along with the President's annual budget 
     request for each fiscal year after 2007, a report 
     containing--
       (A) a description, including quantitative analysis, of 
     progress in achieving performance goals transmitted under 
     paragraph (1), as compared to the baselines transmitted under 
     paragraph (1); and
       (B) any amendments to such goals.
       (c) Public Input.--The Secretary shall consider advice from 
     industry, universities, and other interested parties through 
     seeking comments in the Federal Register and other means 
     before transmitting each report under subsection (b).

     SEC. 923. VEHICLES.

       (a) Advanced, Cost-Effective Technologies.-- The Secretary 
     shall conduct a program of research, development, 
     demonstration, and commercial application of advanced, cost-
     effective technologies to improve the energy efficiency and 
     environmental performance of light-duty and heavy-duty 
     vehicles, including--
       (1) hybrid and electric propulsion systems, including plug-
     in hybrid systems;
       (2) advanced engines, including combustion engines;
       (3) advanced materials, including high strength, 
     lightweight materials, such as nanostructured materials, 
     composites, multimaterial parts, carbon fibers, and materials 
     with high thermal conductivity;

[[Page 7176]]

       (4) technologies for reduced drag and rolling resistance;
       (5) whole-vehicle design optimization to reduce the weight 
     of component parts and thus increase the fuel economy of the 
     vehicle, including fiber optics to replace traditional 
     wiring;
       (6) thermoelectric devices that capture waste heat and 
     convert thermal energy into electricity; and
       (7) advanced drivetrains.
       (b) Low-Cost Hydrogen Propulsion and Infrastructure.--The 
     Secretary of Energy 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 two 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 gas;
       (ii) can travel a minimum of 300 miles under normal road 
     conditions; and
       (iii) uses hydrogen produced from water using only solar 
     energy.

     SEC. 924. BUILDINGS.

       (a) Program.--The Secretary shall conduct a program of 
     research, development, demonstration, and commercial 
     application of cost-effective technologies, for new 
     construction and retrofit, to improve the energy efficiency 
     and environmental performance of commercial, industrial, 
     institutional, and residential buildings. The program shall 
     use a whole-buildings approach, integrating work on elements 
     including--
       (1) advanced controls, including occupancy sensors, 
     daylighting controls, wireless technologies, automated 
     responses to changes in the internal and external 
     environment, and real time delivery of information on 
     building system and component performance;
       (2) building envelope, including windows, roofing systems 
     and materials, and building-integrated photovoltaics;
       (3) building systems components, including--
       (A) lighting;
       (B) appliances, including advanced technologies, such as 
     stand-by load technologies, for office equipment, food 
     service equipment, and laundry equipment; and
       (C) heating, ventilation, and cooling systems, including 
     ground-source heat pumps and radiant heating; and
       (4) onsite renewable energy generation.
       (b) Energy Efficient Building Pilot Grant Program.--
       (1) In general.--Not later than 6 months after the date of 
     enactment of this Act, the Secretary shall establish a pilot 
     program to award grants to businesses and organizations for 
     new construction of energy efficient buildings, or major 
     renovations of buildings that will result in energy efficient 
     buildings, to demonstrate innovative energy efficiency 
     technologies, especially those sponsored by the Department.
       (2) Awards.--The Secretary shall award grants under this 
     subsection competitively to those applicants whose 
     proposals--
       (A) best demonstrate--
       (i) likelihood to meet or exceed the design standards 
     referred to in paragraph (7);
       (ii) likelihood to maximize cost-effective energy 
     efficiency opportunities; and
       (iii) advanced energy efficiency technologies; and
       (B) are least likely to be realized without Federal 
     assistance.
       (3) Amount of grants.--Grants under this subsection shall 
     be for up to 50 percent of design and energy modeling costs, 
     not to exceed $50,000 per building. No single grantee may be 
     eligible for more than 3 grants per year under this program.
       (4) Grant payments.--
       (A) Initial payment.--The Secretary shall pay 50 percent of 
     the total amount of the grant to grant recipients upon 
     selection.
       (B) Remainder of payment.--The Secretary shall pay the 
     remaining 50 percent of the grant only after independent 
     certification of operational buildings for compliance with 
     the standards for energy efficient buildings described in 
     paragraph (7).
       (C) Failure to comply.--The Secretary shall not provide the 
     remainder of the payment unless the building is certified 
     within 6 months after operation of the completed building to 
     meet the requirements described in subparagraph (B), or in 
     the case of major renovations the building is certified 
     within 6 months of the completion of the renovations.
       (5) Report to congress.--Not later than 3 years after 
     awarding the first grant under this subsection, the Secretary 
     shall transmit to Congress a report containing--
       (A) the total number and dollar amount of grants awarded 
     under this subsection; and
       (B) an estimate of aggregate cost and energy savings 
     enabled by the pilot program under this subsection.
       (6) Administrative expenses.--Administrative expenses for 
     the program under this subsection shall not exceed 10 percent 
     of appropriated funds.
       (7) Definition of energy efficient building.--For purposes 
     of this subsection, the term ``energy efficient building'' 
     means a building that is independently certified--
       (A) to meet or exceed the applicable United States Green 
     Building Council's Leadership in Energy and Environmental 
     Design standards for a silver, gold, or platinum rating; and
       (B) to achieve a reduction in energy consumption of--
       (i) at least 25 percent for new construction, compared to 
     the energy standards set by the Federal Building Code (10 CFR 
     part 434); and
       (ii) at least 20 percent for major renovations, compared to 
     energy consumption before renovations are begun.
       (c) Standardization Report and Program.--
       (1) Report.--The Secretary shall enter into an arrangement 
     with the National Institute of Building Sciences to--
       (A) conduct a comprehensive assessment of how well current 
     voluntary consensus standards related to buildings match 
     state-of-the-art knowledge on the design, construction, 
     operation, repair, and renovation of high-performance 
     buildings; and
       (B) recommend steps for the Secretary to take to accelerate 
     the development and promulgation of voluntary consensus 
     standards for high-performance buildings that would address 
     all major high-performance building attributes, including 
     energy efficiency, sustainability, safety and security, life-
     cycle cost, and productivity.
       (2) Program.--After receiving the report under paragraph 
     (1), the Secretary shall establish a program of technical 
     assistance and grants to support standards development 
     organizations in--
       (A) the revision of existing standards, to reflect current 
     knowledge of high-performance buildings; and
       (B) the development and promulgation of new standards in 
     areas important to high-performance buildings where there is 
     no existing standard or where an existing standard cannot 
     easily be modified.

     SEC. 925. INDUSTRIES.

       (a) Program.--The Secretary shall conduct a program of 
     research, development, demonstration, and commercial 
     application of advanced technologies to improve the energy 
     efficiency, environmental performance, and process efficiency 
     of energy-intensive and waste-intensive industries. Such 
     program shall be focused on industries whose total annual 
     energy consumption amounts to more than 1.0 percent of the 
     total nationwide annual energy consumption, according to the 
     most recent data available to the Department. Research and 
     development efforts under this section shall give a higher 
     priority to broad-benefit efficiency technologies that have 
     practical application across industry sectors.
       (b) Electric Motor Control Technology.--The program 
     conducted under subsection (a) shall include research on, and 
     development, demonstration, and commercial application of, 
     advanced control devices to improve the energy efficiency of 
     electric motors, including those used in industrial 
     processes, heating, ventilation, and cooling.

     SEC. 926. DEMONSTRATION AND COMMERCIAL APPLICATION.

       (a) Appliances and Testing.--The Secretary shall conduct 
     research and analysis to determine whether, given Department-
     sponsored and other advances in energy efficiency 
     technologies, demonstration and commercial application of 
     innovative, cost-effective energy savings and pollution 
     reducing technologies could be used to improve appliances and 
     test procedures used to measure appliance efficiency.
       (b) Building Energy Codes.--The Secretary shall, in 
     coordination with government, nongovernment, and commercial 
     partners, conduct research and analyses of the best cost-
     effective practices in the development and updating of 
     building energy codes, including for manufactured housing. 
     Analyses shall focus on how to encourage energy efficiency 
     and adoption of newly developed energy production and use 
     equipment.
       (c) Advanced Energy Technology Transfer Centers.--
       (1) 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 
     Technology Transfer Centers, to be located in areas the 
     Secretary determines have the greatest need of the services 
     of such Centers.
       (2) Activities.--
       (A) 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.
       (B) Advisory panel.--Each Center shall establish an 
     advisory panel to advise the Center on how best to accomplish 
     the activities under subparagraph (A).
       (3) Application.--A person seeking a grant under this 
     subsection shall submit to the

[[Page 7177]]

     Secretary an application in such form and containing such 
     information as the Secretary may require. The Secretary may 
     award a grant under this subsection to an entity already in 
     existence if the entity is otherwise eligible under this 
     subsection.
       (4) Selection criteria.--The Secretary shall award grants 
     under this subsection on the basis of the following criteria, 
     at a minimum:
       (A) The ability of the applicant to carry out the 
     activities in paragraph (2).
       (B) 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.
       (5) Matching funds.--The Secretary shall require a non-
     Federal matching requirement of at least 50 percent of the 
     costs of establishing and operating each Center.
       (6) Advisory committee.--The Secretary shall establish an 
     advisory committee to advise the Secretary on the 
     establishment of Centers under this subsection. 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--
       (A) State or local energy offices;
       (B) energy professionals;
       (C) trade or professional associations;
       (D) architects, engineers, or construction professionals;
       (E) manufacturers;
       (F) the research community; and
       (G) nonprofit energy or environmental organizations.
       (7) Definitions.--For purposes of this subsection:
       (A) 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.
       (B) Center.--The term ``Center'' means an Advanced Energy 
     Technology Transfer Center established pursuant to this 
     subsection.
       (C) 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.
       (d) Report.--Not later than 2 years after the date of 
     enactment of this Act, and once every 3 years thereafter, the 
     Secretary shall transmit to Congress a report on the results 
     of research and analysis under this section. In calculating 
     cost-effectiveness for purposes of such reports, the 
     Secretary shall include, at a minimum, the avoided cost of 
     additional energy production, savings to the economy from 
     lower peak energy prices and reduced price volatility, and 
     the public and private benefits of reduced pollution.

     SEC. 927. SECONDARY ELECTRIC VEHICLE BATTERY USE PROGRAM.

       (a) Definitions.--For purposes of this section:
       (1) 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.
       (2) 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.
       (b) Program.--The Secretary shall establish and conduct a 
     research, development, demonstration, and commercial 
     application program for the secondary use of batteries if the 
     Secretary finds that there are sufficient numbers of such 
     batteries to support the program. The program shall be--
       (1) designed to demonstrate the use of batteries in 
     secondary applications, including utility and commercial 
     power storage and power quality;
       (2) 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
       (3) coordinated with ongoing secondary battery use programs 
     at the National Laboratories and in industry.
       (c) Solicitation.--Not later than 180 days after the date 
     of enactment of this Act, if the Secretary finds under 
     subsection (b) that there are sufficient numbers of batteries 
     to support the program, 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. The Secretary may 
     make additional solicitations for proposals if the Secretary 
     determines that such solicitations are necessary to carry out 
     this section.
       (d) Selection of Proposals.--
       (1) In general.--The Secretary shall, not later than 90 
     days after the closing date established by the Secretary for 
     receipt of proposals under subsection (c), select up to 5 
     proposals which may receive financial assistance under this 
     section, subject to the availability of appropriations.
       (2) Diversity; environmental effect.--In selecting 
     proposals, the Secretary shall consider diversity of battery 
     type, geographic and climatic diversity, and 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 authorized 
     for the program under this section.
       (4) Optimization of federal resources.--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.--The Secretary may consider such other 
     criteria as the Secretary considers appropriate.
       (e) Conditions.--The Secretary shall require that--
       (1) relevant information be provided to the Department, the 
     users of the batteries, the proposers, and the battery 
     manufacturers;
       (2) the proposer provide at least 50 percent of the costs 
     associated with the proposal; and
       (3) the proposer provide to the Secretary such information 
     regarding the disposal of the batteries as the Secretary may 
     require to ensure that the proposer disposes of the batteries 
     in accordance with applicable law.

     SEC. 928. NEXT GENERATION LIGHTING INITIATIVE.

       (a) In General.--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.
       (b) 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; more energy-efficient; and 
     cost-competitive, and have less environmental impact.
       (c) Industry Alliance.--The Secretary shall, not later than 
     3 months after the date of enactment of this section, 
     competitively select an Industry Alliance to represent 
     participants that are private, for-profit firms which, as a 
     group, are broadly representative of United States solid 
     state lighting research, development, infrastructure, and 
     manufacturing expertise as a whole.
       (d) Research.--
       (1) In general.--The Secretary shall carry out the research 
     activities of the Next Generation Lighting Initiative through 
     competitively awarded grants to researchers, including 
     Industry Alliance participants, National Laboratories, and 
     institutions of higher education.
       (2) Assistance from the industry alliance.--The Secretary 
     shall annually solicit from the Industry Alliance--
       (A) comments to identify solid-state lighting technology 
     needs;
       (B) assessment of the progress of the Initiative's research 
     activities; and
       (C) assistance in annually updating solid-state lighting 
     technology roadmaps.
       (3) Availability of information and roadmaps.--The 
     information and roadmaps under paragraph (2) shall be 
     available to the public and public response shall be 
     solicited by the Secretary.
       (e) Development, Demonstration, and Commercial 
     Application.--The Secretary shall carry out a development, 
     demonstration, and commercial application program for the 
     Next Generation Lighting Initiative through competitively 
     selected awards. The Secretary may give preference to 
     participants of the Industry Alliance selected pursuant to 
     subsection (c).
       (f) Intellectual Property.--The Secretary may require, in 
     accordance with the authorities provided in 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--
       (1) for any new invention resulting from activities under 
     subsection (d)--
       (A) the Industry Alliance members that are active 
     participants in research, development, and demonstration 
     activities related to the advanced solid-state lighting 
     technologies that are the subject of this section shall be 
     granted first option to negotiate with the invention owner 
     nonexclusive licenses and royalties for uses of the invention 
     related to solid-state lighting on terms that are reasonable 
     under the circumstances; and
       (B)(i) 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 subparagraph (A); and
       (ii) during the year described in clause (i), the invention 
     owner shall negotiate nonexclusive licenses and royalties in 
     good faith with any interested participant in the Industry 
     Alliance described in subparagraph (A); and
       (2) such other terms as the Secretary determines are 
     required to promote accelerated commercialization of 
     inventions made under the Initiative.
       (g) National Academy Review.--The Secretary shall enter 
     into an arrangement with the National Academy of Sciences to 
     conduct periodic reviews of the Next Generation Lighting 
     Initiative. The Academy shall review the research priorities, 
     technical milestones, and plans for technology transfer and

[[Page 7178]]

     progress towards achieving them. The Secretary shall consider 
     the results of such reviews in evaluating the information 
     obtained under subsection (d)(2).
       (h) Definitions.--As used 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) Research.--The term ``research'' includes research on 
     the technologies, materials, and manufacturing processes 
     required for white light emitting diodes.
       (3) Industry alliance.--The term ``Industry Alliance'' 
     means an entity selected by the Secretary under subsection 
     (c).
       (4) White light emitting diode.--The term ``white light 
     emitting diode'' means a semiconducting package, utilizing 
     either organic or inorganic materials, that produces white 
     light using externally applied voltage.

     SEC. 929. DEFINITIONS.

       For the purposes of this chapter--
       (1) the term ``cost-effective'' means resulting in a simple 
     payback of costs in 10 years or less; and
       (2) the term ``whole-buildings approach'' includes, on a 
     life-cycle basis, the energy use, cost of operations, and 
     ease of repair or upgrade of a building.

     SEC. 930. AUTHORIZATION OF APPROPRIATIONS.

       The following sums are authorized to be appropriated to the 
     Secretary for the purposes of carrying out this chapter:
       (1) For fiscal year 2006, $620,000,000, including--
       (A) $200,000,000 for carrying out the vehicles program 
     under section 923;
       (B) $100,000,000 for carrying out the buildings program 
     under section 924, of which $10,000,000 shall be for the 
     grant program under section 924(b);
       (C) $100,000,000 for carrying out the industries program 
     under section 925(a);
       (D) $2,000,000 for carrying out the electric motor control 
     technology program under section 925(b);
       (E) $10,000,000 for carrying out demonstration and 
     commercial applications activities under section 926;
       (F) $4,000,000 for carrying out the secondary electric 
     vehicle battery use program under section 927; and
       (G) $20,000,000 for carrying out the Next Generation 
     Lighting Initiative under section 928.
       (2) For fiscal year 2007, $700,000,000, including--
       (A) $240,000,000 for carrying out the vehicles program 
     under section 923;
       (B) $130,000,000 for carrying out the buildings program 
     under section 924, of which $10,000,000 shall be for the 
     grant program under section 924(b);
       (C) $115,000,000 for carrying out the industries program 
     under section 925(a);
       (D) $2,000,000 for carrying out the electric motor control 
     technology program under section 925(b);
       (E) $10,000,000 for carrying out demonstration and 
     commercial applications activities under section 926;
       (F) $7,000,000 for carrying out the secondary electric 
     vehicle battery use program under section 927; and
       (G) $30,000,000 for carrying out the Next Generation 
     Lighting Initiative under section 928.
       (3) For fiscal year 2008, $800,000,000, including--
       (A) $270,000,000 for carrying out the vehicles program 
     under section 923;
       (B) $160,000,000 for carrying out the buildings program 
     under section 924, of which $10,000,000 shall be for the 
     grant program under section 924(b);
       (C) $140,000,000 for carrying out the industries program 
     under section 925(a);
       (D) $2,000,000 for carrying out the electric motor control 
     technology program under section 925(b);
       (E) $10,000,000 for carrying out demonstration and 
     commercial applications activities under section 926;
       (F) $7,000,000 for carrying out the secondary electric 
     vehicle battery use program under section 927; and
       (G) $50,000,000 for carrying out the Next Generation 
     Lighting Initiative under section 928.
       (4) For fiscal year 2009, $925,000,000, including--
       (A) $310,000,000 for carrying out the vehicles program 
     under section 923;
       (B) $200,000,000 for carrying out the buildings program 
     under section 924, of which $10,000,000 shall be for the 
     grant program under section 924(b);
       (C) $170,000,000 for carrying out the industries program 
     under section 925(a);
       (D) $10,000,000 for carrying out demonstration and 
     commercial applications activities under section 926;
       (E) $7,000,000 for carrying out the secondary electric 
     vehicle battery use program under section 927; and
       (F) $50,000,000 for carrying out the Next Generation 
     Lighting Initiative under section 928.
       (5) For fiscal year 2010, $1,000,000,000, including--
       (A) $340,000,000 for carrying out the vehicles program 
     under section 923;
       (B) $240,000,000 for carrying out the buildings program 
     under section 924, of which $10,000,000 shall be for the 
     grant program under section 924(b);
       (C) $190,000,000 for carrying out the industries program 
     under section 925(a);
       (D) $10,000,000 for carrying out demonstration and 
     commercial applications activities under section 926;
       (E) $7,000,000 for carrying out the secondary electric 
     vehicle battery use program under section 927; and
       (F) $50,000,000 for carrying out the Next Generation 
     Lighting Initiative under section 928.

     SEC. 931. LIMITATION ON USE OF FUNDS.

       None of the funds authorized to be appropriated under this 
     chapter may be used for--
       (1) the issuance and implementation of energy efficiency 
     regulations;
       (2) the Weatherization Assistance Program under part A of 
     title IV of the Energy Conservation and Production Act (42 
     U.S.C. 6861 et seq.);
       (3) the State Energy Program under part D of title III of 
     the Energy Policy and Conservation Act (42 U.S.C. 6321 et 
     seq.); or
       (4) the Federal Energy Management Program under part 3 of 
     title V of the National Energy Conservation Policy Act (42 
     U.S.C. 8251 et seq.).

       CHAPTER 2--DISTRIBUTED ENERGY AND ELECTRIC ENERGY SYSTEMS

     SEC. 932. DISTRIBUTED ENERGY.

       (a) In General.--The Secretary shall conduct programs of 
     distributed energy resources and systems reliability and 
     efficiency research, development, demonstration, and 
     commercial application to improve the reliability and 
     efficiency of distributed energy resources and systems, 
     including activities described in this chapter. The programs 
     shall address advanced energy technologies and systems and 
     advanced grid reliability technologies. The programs shall 
     include the integration of--
       (1) renewable energy resources;
       (2) fuel cells;
       (3) combined heat and power systems;
       (4) microturbines;
       (5) advanced natural gas turbines;
       (6) advanced internal combustion engine generators;
       (7) energy storage devices;
       (8) interconnection standards, protocols, and equipment;
       (9) ancillary equipment for dispatch and control; and
       (10) any other energy technologies, as appropriate.
       (b) Micro-Cogeneration Energy Technology.--The Secretary 
     shall make competitive, merit-based grants to consortia for 
     the development of micro-cogeneration energy technology. The 
     consortia shall explore--
       (1) the use of small-scale combined heat and power in 
     residential heating appliances; or
       (2) the use of excess power to operate other appliances 
     within the residence and supply excess generated power to the 
     power grid.
       (c) Goals.--
       (1) Initial goals.--In accordance with the performance plan 
     and report requirements in section 4 of the Government 
     Performance Results Act of 1993, the Secretary shall transmit 
     to the Congress, along with the President's annual budget 
     request for fiscal year 2007, a report containing outcome 
     measures with explicitly stated cost and performance 
     baselines. The measures shall specify performance goals, with 
     quantifiable 5-year cost and energy savings target levels, 
     for distributed energy resources and systems, and any other 
     such goals the Secretary considers appropriate.
       (2) Subsequent transmittals.--The Secretary shall transmit 
     to the Congress, along with the President's annual budget 
     request for each fiscal year after 2007, a report 
     containing--
       (A) a description, including quantitative analysis, of 
     progress in achieving performance goals transmitted under 
     paragraph (1), as compared to the baselines transmitted under 
     paragraph (1); and
       (B) any amendments to such goals.

     SEC. 933. ELECTRICITY TRANSMISSION AND DISTRIBUTION AND 
                   ENERGY ASSURANCE.

       (a) Program.--The Secretary shall conduct a research, 
     development, demonstration, and commercial application 
     program on advanced control devices to improve the energy 
     efficiency and reliability of the electric transmission and 
     distribution systems and to protect the Nation against severe 
     energy supply disruptions. This program shall address, at a 
     minimum--
       (1) advanced energy delivery and storage technologies, 
     materials, and systems, including new transmission 
     technologies, such as flexible alternating current 
     transmission systems, 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

[[Page 7179]]

     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) Goals.--
       (1) Initial goals.--In accordance with the performance plan 
     and report requirements in section 4 of the Government 
     Performance Results Act of 1993, the Secretary shall transmit 
     to the Congress, along with the President's annual budget 
     request for fiscal year 2007, a report containing outcome 
     measures with explicitly stated cost and performance 
     baselines. The measures shall specify performance goals, with 
     quantifiable 5-year cost and energy savings target levels, 
     for electricity transmission and distribution and energy 
     assurance, and any other such goals the Secretary considers 
     appropriate.
       (2) Subsequent transmittals.--The Secretary shall transmit 
     to the Congress, along with the President's annual budget 
     request for each fiscal year after 2007, a report 
     containing--
       (A) a description, including quantitative analysis, of 
     progress in achieving performance goals transmitted under 
     paragraph (1), as compared to the baselines transmitted under 
     paragraph (1); and
       (B) any amendments to such goals.
       (c) 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.

     SEC. 933A. ADVANCED PORTABLE POWER DEVICES.

       (a) Program.--The Secretary shall--
       (1) establish a research, development, and demonstration 
     program to develop working models of small scale portable 
     power devices; and
       (2) 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.
       (b) Organization.--The universities identified and utilized 
     under subsection (a)(2) are authorized to establish an 
     organization to promote small scale portable power devices.
       (c) Definition.--For purposes of this section, 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.

     SEC. 934. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--The following sums are authorized to be 
     appropriated to the Secretary for the purposes of carrying 
     out this chapter:
       (1) For fiscal year 2006, $220,000,000.
       (2) For fiscal year 2007, $240,000,000.
       (3) For fiscal year 2008, $250,000,000.
       (4) For fiscal year 2009, $265,000,000.
       (5) For fiscal year 2010, $275,000,000.
       (b) Micro-Cogeneration Energy Technology.--From the amounts 
     authorized under subsection (a), $20,000,000 for each of 
     fiscal years 2006 and 2007 are authorized for activities 
     under section 932(b).
       (c) Electricity Transmission and Distribution and Energy 
     Assurance.--From the amounts authorized under subsection (a), 
     the following sums are authorized for activities under 
     section 933:
       (1) For fiscal year 2006, $130,000,000, of which $2,000,000 
     shall be for the program under section 933(c).
       (2) For fiscal year 2007, $140,000,000.
       (3) For fiscal year 2008, $150,000,000.
       (4) For fiscal year 2009, $160,000,000.
       (5) For fiscal year 2010, $165,000,000.

                      Subtitle D--Renewable Energy

     SEC. 935. FINDINGS.

       Congress makes the following findings:
       (1) Renewable energy is a growth industry around the world. 
     However, the United States has not been investing as heavily 
     as other countries, and is losing market share.
       (2) Since 1996, the United States has lost significant 
     market share in the solar industry, dropping from 44 percent 
     of the world market to 13 percent in 2003.
       (3) In 2003, Japan spent more than $200,000,000 on solar 
     research, development, demonstration, and commercial 
     application and other incentives, and Germany provided more 
     than $750,000,000 in low cost financing for solar 
     photovoltaic projects. This compares to United States 
     Government spending of $139,000,000 in 2003 for research, 
     development, demonstration, and commercial application and 
     other incentives.
       (4) Germany and Japan each had domestic photovoltaic 
     industries that employed more than 10,000 people in 2003, 
     while in the same year the United States photovoltaics 
     industry employed only 2,000 people.
       (5) The United States is becoming increasingly dependent on 
     imported energy.
       (6) The high cost of fossil fuels is hurting the United 
     States economy.
       (7) Small reductions in peak demand can result in very 
     large reductions in price, according to energy market 
     experts.
       (8) Although the United States has only 2 percent of the 
     world's oil reserves and 3 percent of the world's natural gas 
     reserves, our Nation's renewable energy resources are vast 
     and largely untapped.
       (9) Renewable energy can reduce the demand for imported 
     energy, reducing costs and decreasing the variability of 
     energy prices.
       (10) By using domestic renewable energy resources, the 
     United States can reduce the amount of money sent into 
     unstable regions of the world and keep it in the United 
     States.
       (11) By supporting renewable energy research and 
     development, and funding demonstration and commercial 
     application programs for renewable energy, the United States 
     can create an export industry and improve the balance of 
     trade.
       (12) Renewable energy can significantly reduce the 
     environmental impacts of energy production.

     SEC. 936. DEFINITIONS.

       For purposes of this subtitle:
       (1) Biobased product.--The term ``biobased product'' means 
     a product determined by the Secretary to be a commercial or 
     industrial product (other than food or feed) that is--
       (A) composed, in whole or in significant part, of--
       (i) biological products;
       (ii) renewable domestic agricultural materials (including 
     plant, animal, and marine materials); or
       (iii) forestry materials; and
       (B) produced in connection with the conversion of biomass 
     to energy or fuel.
       (2) Cellulosic biomass.--The term ``cellulosic biomass'' 
     means a crop containing lignocellulose or hemicellulose, 
     including barley grain, grapeseed, forest thinnings, rice 
     bran, rice hulls, rice straw, soybean matter, sugarcane 
     bagasse, and any crop grown specifically for the purpose of 
     producing cellulosic feedstocks.

     SEC. 937. PROGRAMS.

       (a) In General.--The Secretary shall conduct programs of 
     renewable energy research, development, demonstration, and 
     commercial application, including activities described in 
     this subtitle. Such programs shall be focused on the 
     following objectives:
       (1) Increasing the conversion efficiency of all forms of 
     renewable energy through improved technologies.
       (2) Decreasing the cost of renewable energy generation and 
     delivery.
       (3) Promoting the diversity of the energy supply.
       (4) Decreasing the Nation's dependence on foreign energy 
     supplies.
       (5) Improving United States energy security.
       (6) Decreasing the environmental impact of energy-related 
     activities.
       (7) Increasing the export of renewable generation equipment 
     from the United States.
       (b) Goals.--
       (1) Initial goals.--In accordance with the performance plan 
     and report requirements in section 4 of the Government 
     Performance Results Act of 1993, the Secretary shall transmit 
     to the Congress, along with the President's annual budget 
     request for fiscal year 2007, a report containing outcome 
     measures with explicitly stated cost and performance 
     baselines. The measures shall specify renewable energy 
     performance goals, with quantifiable 5-year cost and energy 
     savings target levels, for wind power, photovoltaics, solar 
     thermal systems (including concentrating and solar hot 
     water), geothermal energy, biomass-based systems, biofuels, 
     and hydropower, and any other such goals the Secretary 
     considers appropriate.
       (2) Subsequent transmittals.--The Secretary shall transmit 
     to the Congress, along with the President's annual budget 
     request for each fiscal year after 2007, a report 
     containing--
       (A) a description, including quantitative analysis, of 
     progress in achieving performance goals transmitted under 
     paragraph (1), as compared to the baselines transmitted under 
     paragraph (1); and
       (B) any amendments to such goals.
       (c) Public Input.--The Secretary shall consider advice from 
     industry, universities, and other interested parties through 
     seeking comments in the Federal Register and other means 
     before transmitting each report under subsection (b).

     SEC. 938. SOLAR.

       (a) Program.--The Secretary shall conduct a program of 
     research, development, demonstration, and commercial 
     application for solar energy, including--
       (1) photovoltaics;
       (2) solar hot water and solar space heating; and
       (3) concentrating solar power.
       (b) Building Integration.--For photovol-
     taics, solar hot water, and space heating, the

[[Page 7180]]

     Secretary shall conduct research, development, demonstration, 
     and commercial application to support the development of 
     products that can be easily integrated into new and existing 
     buildings.
       (c) Manufacture.--The Secretary shall conduct research, 
     development, demonstration, and commercial application of 
     manufacturing techniques that can produce low-cost, high-
     quality solar systems.

     SEC. 939. BIOENERGY PROGRAMS.

       (a) Program.--The Secretary shall conduct a program of 
     research, development, demonstration, and commercial 
     application for cellulosic biomass, including--
       (1) biomass conversion to heat and electricity;
       (2) biomass conversion to liquid fuels;
       (3) biobased products;
       (4) integrated biorefineries that may produce heat, 
     electricity, liquid fuels, and biobased products;
       (5) cross-cutting activities on feedstocks and enzymes; and
       (6) life-cycle economic analysis.
       (b) Biofuels and Biobased Products.--The objectives of the 
     biofuels and biobased products programs under paragraphs (2), 
     (3), and (4) of subsection (a), and of the biorefinery 
     demonstration program under subsection (c), shall be to 
     develop, in partnership with industry--
       (1) advanced biochemical and thermochem-
     ical conversion technologies capable of making high-value 
     biobased chemical feedstocks and products, to substitute for 
     petroleum-based feedstocks and products, biofuels that are 
     price-competitive with gasoline or diesel in either internal 
     combustion engines or fuel cell-powered vehicles, and 
     biobased products from a variety of feedstocks, including 
     grains, cellulosic biomass, and agricultural byproducts; and
       (2) advanced biotechnology processes capable of making 
     biofuels and biobased products, with emphasis on development 
     of biorefinery technologies, including enzyme-based 
     processing technologies.
       (c) Biomass Integrated Refinery Demonstration.--
       (1) In general.--The Secretary shall conduct a program to 
     demonstrate the commercial application of at least 5 
     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. The Secretary shall award the biorefinery 
     demonstrations so as to encourage--
       (A) the demonstration of a wide variety of cellulosic 
     biomass 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.
       (d) University Biodiesel Program.--The Secretary shall 
     establish a demonstraton program to determine the feasibility 
     of the operation of diesel electric power generators, using 
     biodiesel fuels, with ratings as high as B100 at a university 
     electric generation facility. 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.
       (e) Grants.--Of the funds authorized to be appropriated for 
     activities authorized under this section, not less than 
     $5,000,000 for each fiscal year shall be made available for 
     grants to Historically Black Colleges and Universities, 
     Tribal Colleges, and Hispanic-Serving Institutions.

     SEC. 940. WIND.

       (a) Program.--The Secretary shall conduct a program of 
     research, development, demonstration, and commercial 
     application for wind energy, including--
       (1) low speed wind energy;
       (2) offshore wind energy;
       (3) testing and verification; and
       (4) distributed wind energy generation.
       (b) Facility.--The Secretary shall construct and operate a 
     research and testing facility capable of testing the largest 
     wind turbines that are expected to be manufactured in the 
     next 15 years. The Secretary shall consider the need for 
     testing offshore turbine designs in siting the facility. All 
     private users of the facility shall be required to pay the 
     Department all costs associated with their use of the 
     facility, including capital costs prorated at normal business 
     amortization rates.
       (c) Regional Field Verification Program.--Of the funds 
     authorized to be appropriated for activities authorized under 
     this section, not less than $4,000,000 for each fiscal year 
     shall be made available for the Regional Field Verification 
     Program of the Department.

     SEC. 941. 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--
       (1) improving detection of geothermal resources;
       (2) decreasing drilling costs;
       (3) decreasing maintenance costs through improved 
     materials;
       (4) increasing the potential for other revenue sources, 
     such as mineral production; and
       (5) increasing the understanding of reservoir life cycle 
     and management.

     SEC. 942. PHOTOVOLTAIC DEMONSTRATION PROGRAM.

       (a) In General.--The Secretary shall establish a program of 
     grants to States to demonstrate advanced photovoltaic 
     technology.
       (b) Requirements.--(1) To receive funding under the program 
     under this section, a State must submit a proposal that 
     demonstrates, to the satisfaction of the Secretary, that the 
     State will meet the requirements of subsection (f).
       (2) If a State has received funding under this section for 
     the preceding year, the State must demonstrate, to the 
     satisfaction of the Secretary, that it complied with the 
     requirements of subsection (f) in carrying out the program 
     during that preceding year, and that it will do so in the 
     future.
       (3) Except as provided in subsection (c), each State 
     submitting a qualifying proposal shall receive funding under 
     the program based on the proportion of United States 
     population in the State according to the 2000 census. In each 
     fiscal year, the portion of funds attributable under this 
     paragraph to States that have not submitted qualifying 
     proposals in the time and manner specified by the Secretary 
     shall be distributed pro rata to the States that have 
     submitted qualifying proposals in the specified time and 
     manner.
       (c) Competition.--If more than $80,000,000 is available for 
     the program under this section for any fiscal year, the 
     Secretary shall allocate 75 percent of the funds available 
     according to subsection (b), and shall award the remaining 25 
     percent on a competitive basis to the States with the 
     proposals the Secretary considers most likely to encourage 
     the widespread adoption of photovoltaic technologies.
       (d) Proposals.--Not later than 6 months after the date of 
     enactment of this Act, and in each subsequent fiscal year for 
     the life of the program, the Secretary shall solicit 
     proposals from the States to participate in the program under 
     this section.
       (e) Competitive Criteria.--In awarding funds in a 
     competitive allocation under subsection (c), the Secretary 
     shall consider--
       (1) the likelihood of a proposal to encourage the 
     demonstration of, or lower the costs of, advanced 
     photovoltaic technologies; and
       (2) the extent to which a proposal is likely to--
       (A) maximize the amount of photovoltaics demonstrated;
       (B) maximize the proportion of non-Federal cost share; and
       (C) limit State administrative costs.
       (f) State Program.--A program operated by a State with 
     funding under this section shall provide competitive awards 
     for the demonstration of advanced photovoltaic technologies. 
     Each State program shall--
       (1) require a contribution of at least 60 percent per award 
     from non-Federal sources, which may include any combination 
     of State, local, and private funds, except that at least 10 
     percent of the funding must be supplied by the State;
       (2) limit awards for any single project to a maximum of 
     $1,000,000;
       (3) prohibit any nongovernmental recipient from receiving 
     more than $1,000,000 per year;
       (4) endeavor to fund recipients in the commercial, 
     industrial, institutional, governmental, and residential 
     sectors;
       (5) limit State administrative costs to no more than 10 
     percent of the grant;
       (6) report annually to the Department on--
       (A) the amount of funds disbursed;
       (B) the amount of photovoltaics purchased; and
       (C) the results of the monitoring under paragraph (7);
       (7) provide for measurement and verification of the output 
     of a representative sample of the photovoltaics systems 
     demonstrated throughout the average working life of the 
     systems, or at least 20 years; and
       (8) require that applicant buildings must have received an 
     independent energy efficiency audit during the 6-month period 
     preceding the filing of the application.
       (g) Unexpended Funds.--If a State fails to expend any funds 
     received under subsection

[[Page 7181]]

     (b) or (c) within 3 years of receipt, such remaining funds 
     shall be returned to the Treasury.
       (h) Reports.--The Secretary shall report to Congress 5 
     years after funds are first distributed to the States under 
     this section--
       (1) the amount of photovoltaics demonstrated;
       (2) the number of projects undertaken;
       (3) the administrative costs of the program;
       (4) the amount of funds that each State has not received 
     because of a failure to submit a qualifying proposal, as 
     described in subsection (b)(3);
       (5) the results of the monitoring under subsection (f)(7); 
     and
       (6) the total amount of funds distributed, including a 
     breakdown by State.

     SEC. 943. ADDITIONAL PROGRAMS.

       (a) In General.--The Secretary may conduct research, 
     development, demonstration, and commercial application 
     programs of--
       (1) ocean energy, including wave energy;
       (2) kinetic hydro turbines; and
       (3) the combined use of renewable energy technologies with 
     one another and with other energy technologies.
       (b) Marine Renewable Energy Study.--
       (1) Study.--The Secretary shall enter into an arrangement 
     with the National Academy of Sciences to conduct a study on--
       (A) the feasibility of various methods of renewable 
     generation of energy from the ocean, including energy from 
     waves, tides, currents, and thermal gradients; and
       (B) the research, development, demonstration, and 
     commercial application activities required to make marine 
     renewable energy generation competitive with other forms of 
     electricity generation.
       (2) Transmittal.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary shall transmit the study 
     to Congress along with the Secretary's recommendations for 
     implementing the results of the study.
       (c) Renewable Energy in Public Buildings.--
       (1) 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.
       (2) Limit on federal funding.--The Secretary shall provide 
     under this subsection no more than 40 percent of the 
     incremental costs of the solar or other renewable energy 
     source project funded.
       (3) Requirement.--As part of the application for awards 
     under this subsection, the Secretary shall require all 
     applicants--
       (A) to demonstrate a continuing commitment to the use of 
     solar and other renewable energy sources in buildings they 
     own or operate; and
       (B) to state how they expect any award to further their 
     transition to the significant use of renewable energy.

     SEC. 944. ANALYSIS AND EVALUATION.

       (a) 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--
       (1) economic and technical analysis of renewable energy 
     potential, including resource assessment;
       (2) analysis of past program performance, both in terms of 
     technical advances and in market introduction of renewable 
     energy; and
       (3) any other analysis or evaluation that the Secretary 
     considers appropriate.
       (b) 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 section.

     SEC. 945. AUTHORIZATION OF APPROPRIATIONS.

       The following sums are authorized to be appropriated to the 
     Secretary for the purposes of carrying out this subtitle:
       (1) For fiscal year 2006, $465,000,000, of which--
       (A) $100,000,000 shall be for carrying out the solar 
     program under section 938;
       (B) $200,000,000 shall be for carrying out the bioenergy 
     program under section 939, including $100,000,000 for the 
     biorefinery demonstration program under section 939(c);
       (C) $55,000,000 shall be for carrying out the wind program 
     under section 940, including $10,000,000 for the facility 
     described in section 940(b);
       (D) $30,000,000 shall be for carrying out the geothermal 
     program under section 941; and
       (E) $50,000,000 shall be for carrying out the photovoltaic 
     demonstration program under section 942.
       (2) For fiscal year 2007, $605,000,000, of which--
       (A) $140,000,000 shall be for carrying out the solar 
     program under section 938;
       (B) $245,000,000 shall be for carrying out the bioenergy 
     program under section 939, including $125,000,000 for the 
     biorefinery demonstration program under section 939(c);
       (C) $60,000,000 shall be for carrying out the wind program 
     under section 940, including $15,000,000 for the facility 
     described in section 940(b);
       (D) $30,000,000 shall be for carrying out the geothermal 
     program under section 941; and
       (E) $100,000,000 shall be for carrying out the photovoltaic 
     demonstration program under section 942.
       (3) For fiscal year 2008, $775,000,000, of which--
       (A) $200,000,000 shall be for carrying out the solar 
     program under section 938;
       (B) $310,000,000 shall be for carrying out the bioenergy 
     program under section 939, including $150,000,000 for the 
     biorefinery demonstration program under section 939(c);
       (C) $65,000,000 shall be for carrying out the wind program 
     under section 940, including $10,000,000 for the facility 
     described in section 940(b);
       (D) $30,000,000 shall be for carrying out the geothermal 
     program under section 941; and
       (E) $150,000,000 shall be for carrying out the photovoltaic 
     demonstration program under section 942.
       (4) For fiscal year 2009, $940,000,000, of which--
       (A) $250,000,000 shall be for carrying out the solar 
     program under section 938;
       (B) $355,000,000 shall be for carrying out the bioenergy 
     program under section 939, including $175,000,000 for the 
     biorefinery demonstration program under section 939(c);
       (C) $65,000,000 shall be for carrying out the wind program 
     under section 940, including $5,000,000 for the facility 
     described in section 940(b);
       (D) $30,000,000 shall be for carrying out the geothermal 
     program under section 941; and
       (E) $200,000,000 shall be for carrying out the photovoltaic 
     demonstration program under section 942.
       (5) For fiscal year 2010, $1,125,000,000, of which--
       (A) $300,000,000 shall be for carrying out the solar 
     program under section 938;
       (B) $400,000,000 shall be for carrying out the bioenergy 
     program under section 939, including $200,000,000 for the 
     biorefinery demonstration program under section 939(c);
       (C) $65,000,000 shall be for carrying out the wind program 
     under section 940, including $1,000,000 for the facility 
     described in section 940(b);
       (D) $30,000,000 shall be for carrying out the geothermal 
     program under section 941; and
       (E) $300,000,000 shall be for carrying out the photovoltaic 
     demonstration program under section 942.

                  Subtitle E--Nuclear Energy Programs

     SEC. 946. DEFINITION.

       In this subtitle, 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 section 949(b)(2).

     SEC. 947. PROGRAMS.

       (a) In General.--The Secretary shall conduct programs of 
     civilian nuclear energy research, development, demonstration, 
     and commercial application, including activities described in 
     this subtitle. Programs under this subtitle shall be focused 
     on--
       (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; and
       (8) reducing the environmental impact of nuclear energy-
     related activities.
       (b) Goals.--
       (1) Initial goals.--In accordance with the performance plan 
     and report requirements in section 4 of the Government 
     Performance Results Act of 1993, the Secretary shall transmit 
     to the Congress, along with the President's annual budget 
     request for fiscal year 2007, a report containing outcome 
     measures with explicitly stated cost and performance 
     baselines. The measures shall specify performance goals, with 
     quantifiable 5-year cost improvement and reliability, 
     availability, productivity, and component aging target levels 
     for a wide range of nuclear energy technologies, and any 
     other such goals the Secretary considers appropriate.
       (2) Subsequent transmittals.--The Secretary shall transmit 
     to the Congress, along with the President's annual budget 
     request for each fiscal year after 2007, a report 
     containing--
       (A) a description, including quantitative analysis, of 
     progress in achieving performance goals transmitted under 
     paragraph (1), as compared to the baselines transmitted under 
     paragraph (1); and
       (B) any amendments to such goals.
       (c) Public Input.--The Secretary shall consider advice from 
     industry, universities, and other interested parties through 
     seeking comments in the Federal Register and other

[[Page 7182]]

     means before transmitting each report under subsection (b).

              CHAPTER 1--NUCLEAR ENERGY RESEARCH PROGRAMS

     SEC. 948. ADVANCED FUEL RECYCLING PROGRAM.

       (a) In General.--The Secretary shall conduct an advanced 
     fuel recycling technology research, development, 
     demonstration, and commercial application program to evaluate 
     fuel recycling or transmutation technologies which are 
     proliferation-resistant and 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 
     advanced reactor concepts. The program shall be subject to 
     annual review by the Secretary's Nuclear Energy Research 
     Advisory Committee or other independent entity, as 
     appropriate.
       (b) International Cooperation.--The Secretary shall seek 
     opportunities to engage international partners with expertise 
     in advanced fuel recycling technologies where such 
     partnerships may help achieve program goals.

     SEC. 949. 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 
     Departmental missions 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) 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 focused effort that 
     emphasizes research, training, and education, including 
     through the Innovations in Nuclear Infrastructure and 
     Education Program or any similar program.
       (d) 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.

     SEC. 950. 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.

     SEC. 951. NUCLEAR POWER 2010 PROGRAM.

       The Secretary shall carry out a Nuclear Power 2010 Program, 
     consistent with recommendations in the October 2001 report 
     entitled ``A Roadmap to Deploy New Nuclear Power Plants in 
     the United States by 2010'' issued by the Nuclear Energy 
     Research Advisory Committee of the Department. The Program 
     shall include--
       (1) the expertise and capabilities of industry, 
     universities, and National Laboratories in evaluation of 
     advanced nuclear fuel cycles and fuels testing;
       (2) a variety of reactor designs suitable for both 
     developed and developing nations;
       (3) participation of international collaborators in 
     research, development, and design efforts as appropriate; and
       (4) university and industry participation.

     SEC. 952. GENERATION IV NUCLEAR ENERGY SYSTEMS INITIATIVE.

       The Secretary shall carry out a Generation IV Nuclear 
     Energy Systems Initiative to develop an overall technology 
     plan and to support research, development, demonstration, and 
     commercial application necessary to make an informed 
     technical decision about the most promising candidates for 
     the eventual commercial application of advanced fission 
     reactor technology for the generation of electricity. The 
     Initiative shall examine advanced proliferation-resistant and 
     passively safe reactor designs, including designs that--
       (1) are economically competitive with other electric power 
     generation plants;
       (2) have higher efficiency, lower cost, and improved safety 
     compared to reactors in operation on the date of enactment of 
     this Act;
       (3) use fuels that are proliferation-resistant and have 
     substantially reduced production of high-level waste per unit 
     of output; and
       (4) use improved instrumentation.

     SEC. 953. CIVILIAN INFRASTRUCTURE AND FACILITIES.

       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.

     SEC. 954. NUCLEAR ENERGY RESEARCH AND DEVELOPMENT 
                   INFRASTRUCTURE PLAN.

       In carrying out section 919, 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 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.

     SEC. 955. IDAHO NATIONAL LABORATORY FACILITIES PLAN.

       (a) 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.
       (b) Transmittal to Congress.--Not later than one year after 
     the date of enactment of this Act, the Secretary shall 
     transmit such plan to Congress.

     SEC. 956. AUTHORIZATION OF APPROPRIATIONS.

       (a) Program Authorization.--The following sums are 
     authorized to be appropriated to the Secretary for the 
     purposes of carrying out this chapter:
       (1) $407,000,000 for fiscal year 2006.
       (2) $427,000,000 for fiscal year 2007.
       (3) $449,000,000 for fiscal year 2008.
       (4) $471,000,000 for fiscal year 2009.
       (5) $495,000,000 for fiscal year 2010.
       (b) University Support.--Of the funds authorized under 
     subsection (a), the following sums are authorized to be 
     appropriated to carry out section 949:
       (1) $35,200,000 for fiscal year 2006.
       (2) $44,350,000 for fiscal year 2007.
       (3) $49,200,000 for fiscal year 2008.
       (4) $55,000,000 for fiscal year 2009.
       (5) $60,000,000 for fiscal year 2010.

            CHAPTER 2--NEXT GENERATION NUCLEAR PLANT PROGRAM

     SEC. 957. DEFINITIONS.

       For purposes of this chapter:
       (1) Construction.--The term ``construction'' means the 
     physical construction of the

[[Page 7183]]

     demonstration plant, and the physical construction, purchase, 
     or manufacture of equipment or components that are 
     specifically designed for the demonstration plant, but does 
     not mean the design of the facility, equipment, or 
     components.
       (2) Demonstration plant.--The term ``demonstration plant'' 
     means an advanced fission reactor power plant constructed and 
     operated in accordance with this chapter.
       (3) Operation.--The term ``operation'' means the operation 
     of the demonstration plant, including general maintenance and 
     provision of power, heating and cooling, and other building 
     services that are specifically for the demonstration plant, 
     but does not mean operations that support other activities 
     colocated with the demonstration plant.

     SEC. 958. NEXT GENERATION NUCLEAR POWER PLANT.

       (a) In General.--The Secretary shall conduct a program of 
     research, development, demonstration, and commercial 
     application of advanced nuclear fission reactor technology. 
     The objective of this program shall be to demonstrate the 
     technical and economic feasibility of an advanced nuclear 
     fission reactor power plant design for the commercial 
     production of electricity.
       (b) Research and Development.--The program shall include 
     research, development, design, planning, and all other 
     necessary activities to support the construction and 
     operation of the demonstration plant.
       (c) Subsystem Demonstrations.--The Secretary shall support 
     demonstration of enabling technologies and subsystems and 
     other research, development, demonstration, and commercial 
     application activities necessary to support the activities in 
     this chapter.
       (d) Construction and Operation.--The program shall 
     culminate in the construction and operation of the 
     demonstration plant based on a design selected by the 
     Secretary in accordance with procedures described in the plan 
     required by section 960(c). The demonstration plant shall be 
     located and constructed within the United States and shall be 
     operational, and capable of demonstrating the commercial 
     production of electricity, by December 31, 2015.
       (e) Limitation.--No funds shall be expended for the 
     construction or operation of the demonstration plant until 90 
     days have elapsed after the transmission of the plan 
     described in section 960(c).

     SEC. 959. ADVISORY COMMITTEE.

       The Secretary shall appoint a Next Generation Nuclear Power 
     Plant Subcommittee of the Nuclear Energy Research Advisory 
     Council to provide advice to the Secretary on technical 
     matters and program management for the duration of the 
     program and construction project under this chapter.

     SEC. 960. PROGRAM REQUIREMENTS.

       (a) Partnerships.--In carrying out the program under this 
     chapter, the Secretary shall make use of partnerships with 
     industry for the research, development, design, construction, 
     and operation of the demonstration plant. In establishing 
     such partnerships, the Secretary shall give preference to 
     companies for which the principal base of operations is 
     located in the United States.
       (b) International Collaboration.--(1) The Secretary shall 
     seek international cooperation, participation, and financial 
     contribution in this program, including assistance from 
     specialists or facilities from member countries of the 
     Generation IV International Forum, the Russian Federation, or 
     other international partners where such specialists or 
     facilities provide access to cost-effective and relevant 
     skills or test capabilities.
       (2) International activities shall be carried out in 
     consultation with the Generation IV International Forum.
       (3) The program may include demonstration of selected 
     program objectives in a partner nation.
       (c) Program Plan.--Not later than one year after the date 
     of enactment of this Act, the Secretary shall transmit to 
     Congress a comprehensive program plan. The program plan 
     shall--
       (1) describe the plan for development, selection, 
     management, ownership, operation, and decommissioning of the 
     demonstration plant;
       (2) identify program milestones and a timeline for 
     achieving these milestones;
       (3) provide for development of risk-based criteria for any 
     future commercial development of a reactor architecture based 
     on that of the demonstration plant;
       (4) include a projected budget required to meet the 
     milestones; and
       (5) include an explanation of any major program decisions 
     that deviate from program advice given to the Secretary by 
     the advisory committee established under section 959.

     SEC. 961. AUTHORIZATION OF APPROPRIATIONS.

       (a) Research, Development, and Design Programs.--The 
     following sums are authorized to be appropriated to the 
     Secretary for the purposes of carrying out this chapter 
     except for the demonstration plant activities described in 
     subsection (b):
       (1) For fiscal year 2006, $150,000,000.
       (2) For fiscal year 2007, $150,000,000.
       (3) For fiscal year 2008, $150,000,000.
       (4) For fiscal year 2009, $150,000,000.
       (5) For fiscal year 2010, $150,000,000.
       (b) Reactor Construction.--There are authorized to be 
     appropriated to the Secretary such sums as may be necessary 
     for operation and construction of the demonstration plant 
     under this chapter. The Secretary shall not spend more than 
     $500,000,000 for demonstration plant reactor construction 
     activities under this chapter.

                       Subtitle F--Fossil Energy

                      CHAPTER 1--RESEARCH PROGRAMS

     SEC. 962. ENHANCED FOSSIL ENERGY RESEARCH AND DEVELOPMENT 
                   PROGRAMS.

       (a) In General.--The Secretary shall, in conjunction with 
     industry, conduct fossil energy research, development, 
     demonstration, and commercial applications programs, 
     including activities under this chapter, with the goal of 
     improving the efficiency, effectiveness, and environmental 
     performance of fossil energy production, upgrading, 
     conversion, and consumption. Such programs shall be focused 
     on--
       (1) increasing the 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 Nation's dependence on foreign energy 
     supplies;
       (5) improving United States energy security;
       (6) decreasing the environmental impact of energy-related 
     activities; and
       (7) increasing the export of fossil energy-related 
     equipment, technology, and services from the United States.
       (b) Goals.--
       (1) Initial goals.--In accordance with the performance plan 
     and report requirements in section 4 of the Government 
     Performance Results Act of 1993, the Secretary shall transmit 
     to the Congress, along with the President's annual budget 
     request for fiscal year 2007, a report containing outcome 
     measures with explicitly stated cost and performance 
     baselines. The measures shall specify production or 
     efficiency performance goals, with quantifiable 5-year cost 
     and energy savings target levels, for fossil energy, and any 
     other such goals the Secretary considers appropriate.
       (2) Subsequent transmittals.--The Secretary shall transmit 
     to the Congress, along with the President's annual budget 
     request for each fiscal year after 2007, a report 
     containing--
       (A) a description, including quantitative analysis, of 
     progress in achieving performance goals transmitted under 
     paragraph (1), as compared to the baselines transmitted under 
     paragraph (1); and
       (B) any amendments to such goals.
       (c) Covered Activities.--The Secretary shall ensure that 
     the goals stated in subsection (b) are illustrative of the 
     outcomes necessary to promote acceptance of the programs' 
     efforts in the marketplace, but at a minimum shall encompass 
     the following areas:
       (1) Coal gasifiers.
       (2) Turbine generators, including both natural gas and 
     syngas fueled.
       (3) Oxygen separation devices, hydrogen separation devices, 
     and carbon dioxide separation technologies.
       (4) Coal gas and post-combustion emission cleanup and 
     disposal equipment, including carbon dioxide capture and 
     disposal equipment.
       (5) Average per-foot drilling costs for oil and gas, 
     segregated by appropriate drilling regimes, including onshore 
     versus offshore and depth categories.
       (6) Production of liquid fuels from nontraditional 
     feedstocks, including syngas, biomass, methane, and 
     combinations thereof.
       (7) Environmental discharge per barrel of oil or oil-
     equivalent production, including reinjected waste.
       (8) Surface disturbance on both a per-well and per-barrel 
     of oil or oil-equivalent production basis.
       (d) Public Input.--The Secretary shall consider advice from 
     industry, universities, and other interested parties through 
     seeking comments in the Federal Register and other means 
     before transmitting each report under subsection (b).

     SEC. 963. FOSSIL RESEARCH AND DEVELOPMENT.

       (a) Objectives.--The Secretary shall conduct a program of 
     fossil research, development, demonstration, and commercial 
     application, whose objective shall be to reduce emissions 
     from fossil fuel use by developing technologies, including 
     precombustion technologies, by 2015 with the capability of--
       (1) dramatically increasing electricity generating 
     efficiencies of coal and natural gas;
       (2) improving combined heat and power thermal efficiencies;
       (3) improving fuels utilization efficiency of production of 
     liquid transportation fuels from coal;
       (4) achieving near-zero emissions of mercury and of 
     emissions that form fine particles, smog, and acid rain;
       (5) reducing carbon dioxide emissions by at least 40 
     percent through efficiency improvements and by 100 percent 
     with sequestration; and
       (6) improved reliability, efficiency, reductions of air 
     pollutant emissions, and reductions in solid waste disposal 
     requirements.
       (b) Coal-Based Projects.--The coal-based projects 
     authorized under this section shall be consistent with the 
     objective stated in

[[Page 7184]]

     subsection (a). The program shall emphasize carbon capture 
     and sequestration technologies and gasification technologies, 
     including gasification combined cycle, gasification fuel 
     cells, gasification coproduction, hybrid gasification/
     combustion, or other technologies with the potential to 
     address the capabilities described in paragraphs (4) and (5) 
     of subsection (a).

     SEC. 964. OIL AND GAS RESEARCH AND DEVELOPMENT.

       The Secretary shall conduct a program of oil and gas 
     research, development, demonstration, and commercial 
     application, whose objective shall be to advance 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 by focusing research on--
       (1) assisting small domestic producers of oil and gas to 
     develop new and improved technologies to discover and extract 
     additional supplies;
       (2) developing technologies to extract methane hydrates in 
     an environmentally sound manner;
       (3) improving the ability of the domestic industry to 
     extract hydrocarbons from known reservoirs and classes of 
     reservoirs; and
       (4) reducing the cost, and improving the efficiency and 
     environmental performance, of oil and gas exploration and 
     extraction activities, focusing especially on unconventional 
     sources such as tar sands, heavy oil, and shale oil.

     SEC. 965. TRANSPORTATION FUELS.

       The Secretary shall conduct a program of transportation 
     fuels research, development, demonstration, and commercial 
     application, whose objective shall be to increase the price 
     elasticity of oil supply and demand by focusing research on--
       (1) reducing the cost of producing transportation fuels 
     from coal and natural gas; and
       (2) indirect liquefaction of coal and biomass.

     SEC. 966. FUEL CELLS.

       (a) Program.--The Secretary shall conduct a program of 
     research, development, demonstration, and commercial 
     application of fuel cells for low-cost, high-efficiency, 
     fuel-flexible, modular power systems.
       (b) Demonstration.--The program under this section shall 
     include demonstration of fuel cell proton exchange membrane 
     technology for commercial, residential, and transportation 
     applications, and distributed generation systems, utilizing 
     improved manufacturing production and processes.

     SEC. 967. CARBON DIOXIDE CAPTURE RESEARCH AND DEVELOPMENT.

       (a) Program.--The Secretary of Energy shall support a 10-
     year program of research and development aimed at developing 
     carbon dioxide capture technologies for pulverized coal 
     combustion units. The program shall focus on--
       (1) developing add-on carbon dioxide capture technologies, 
     such as adsorption and absorption techniques and chemical 
     processes, to remove carbon dioxide from flue gas, producing 
     concentrated streams of carbon dioxide potentially amenable 
     to sequestration;
       (2) combustion technologies that would directly produce 
     concentrated streams of carbon dioxide potentially amenable 
     to sequestration; and
       (3) increasing the efficiency of the overall combustion 
     system in order to reduce the amount of carbon dioxide 
     emissions released from the system per megawatt generated.
       (b) Carbon Sequestration.--In conjunction with the program 
     under subsection (a), the Secretary shall continue pursuing a 
     robust carbon sequestration program with the private sector, 
     through regional carbon sequestration partnerships.

     SEC. 968. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--The following sums are authorized to be 
     appropriated to the Secretary for the purposes of carrying 
     out this chapter:
       (1) For fiscal year 2006, $583,000,000.
       (2) For fiscal year 2007, $611,000,000.
       (3) For fiscal year 2008, $626,000,000.
       (4) For fiscal year 2009, $641,000,000.
       (5) For fiscal year 2010, $657,000,000.
       (b) Allocation.--From amounts authorized under subsection 
     (a), there are authorized to be appropriated for carrying out 
     the program under section 967--
       (1) $20,000,000 for fiscal year 2006;
       (2) $25,000,000 for fiscal year 2007;
       (3) $30,000,000 for fiscal year 2008;
       (4) $35,000,000 for fiscal year 2009; and
       (5) $40,000,000 for fiscal year 2010.

  CHAPTER 2--ULTRA-DEEPWATER AND UNCONVENTIONAL NATURAL GAS AND OTHER 
                          PETROLEUM RESOURCES

     SEC. 969. PROGRAM AUTHORITY.

       (a) In General.--The Secretary shall carry out a program 
     under this chapter 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 chapter 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 United States Department of 
     Energy.
       (c) Limitation on Location of Field Activities.--Field 
     activities under the program under this chapter 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 part, the Secretary shall consult regularly 
     with the Secretary of the Interior.

     SEC. 970. 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 969, 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 
     consortium to--
       (A) manage awards pursuant to subsection (f)(3);
       (B) issue project solicitations upon approval of the 
     Secretary;
       (C) make project awards upon approval of the Secretary;
       (D) disburse funds 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) Tax status.--The program consortium shall be an entity 
     that is exempt from tax under section 501(c)(3) of the 
     Internal Revenue Code of 1986 on the date of enactment of 
     this Act.

[[Page 7185]]

       (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 976(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 976(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 
     976(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.
       (8) Criterion.--The Secretary shall consider the amount of 
     the fee an applicant proposes to receive under subsection (g) 
     in selecting a consortium under this section.
       (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 972(a) and to 
     the Unconventional Resources Technology Advisory Committee 
     established under section 972(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 part. 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 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 
     members of the program consortium may receive such awards.
       (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, 
     commercial auditor 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 
     part. The auditor shall transmit a report 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.

     SEC. 971. ADDITIONAL REQUIREMENTS FOR AWARDS.

       (a) Demonstration Projects.--An application for an award 
     under this chapter 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 969(c), a demonstration 
     project under this chapter 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 chapter 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 chapter shall be designated for 
     technology transfer and outreach activities under this 
     chapter.
       (e) Cost Sharing Reduction for Independent Producers.--In 
     applying the cost sharing requirements under section 911 to 
     an award under this chapter 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.

     SEC. 972. 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 chapter related to 
     ultra-deepwater natural gas and other petroleum resources; 
     and

[[Page 7186]]

       (B) carry out section 970(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 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) no individuals who are Federal employees; and
       (E) 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 chapter related to 
     unconventional natural gas and other petroleum resources; and
       (B) carry out section 970(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. 973. LIMITS ON PARTICIPATION.

       An entity shall be eligible to receive an award under this 
     chapter only if the Secretary finds--
       (1) that the entity's participation in the program under 
     this chapter 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 part;
       (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. 974. SUNSET.

       The authority provided by this chapter shall terminate on 
     September 30, 2014.

     SEC. 975. DEFINITIONS.

       In this part:
       (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 consortium.--The term ``program consortium'' 
     means the consortium selected under section 970(d).
       (4) 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.
       (5) 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.
       (6) Ultra-deepwater.--The term ``ultra-deepwater'' means a 
     water depth that is equal to or greater than 1,500 meters.
       (7) 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.
       (8) 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.
       (9) 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. 976. FUNDING.

       (a) In General.--
       (1) Oil and gas lease income.--For each of fiscal years 
     2005 through 2014, from any excess Federal royalties derived 
     from Federal onshore and offshore oil and gas leases issued 
     under the Outer Continental Shelf Lands Act and the Mineral 
     Leasing Act which are deposited in the Treasury, and after 
     prior distributions as described in subsection (c) have been 
     made, all excess Federal royalties up to $200,000,000 shall 
     be deposited into the Ultra-Deepwater and Unconventional 
     Natural Gas and Other Petroleum Research Fund (in this 
     section referred to as the Fund).
       (2) Definitions.--For purposes of paragraph (1)--
       (A) excess Federal royalty receipts are the amount 
     calculated on the basis of the difference between the 
     prevailing market prices upon which the royalty payment was 
     made and 110 percent of the projected market prices for that 
     fiscal year, as contained in the economic assumptions 
     underlying the Concurrent Resolution on the Budget, under 
     section 301 of the Congressional Budget and Impoundment 
     Control Act or 1974; and
       (B) 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)).
       (b) Obligational Authority.--Monies in the Fund shall be 
     available to the Secretary for obligation under this chapter 
     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 Secure Energy Reinvestment Fund.
       (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 
     969(b)(1).
       (2) 32.5 percent shall be for activities under section 
     969(b)(2).
       (3) 7.5 percent shall be for activities under section 
     969(b)(3).
       (4) 25 percent shall be for complementary research under 
     section 969(b)(4) and other activities under section 969(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 subsection 969(b)(4) are 
     technically complementary to, and not duplicative of, 
     research conducted under section 969(b)(1), (2), and (3).
       (e) 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''.

 Subtitle G--Improved Coordination and Management of Civilian Science 
                        and Technology Programs

     SEC. 978. IMPROVED COORDINATION AND MANAGEMENT OF CIVILIAN 
                   SCIENCE AND TECHNOLOGY PROGRAMS.

       (a) Reconfiguration of Position of Director of the Office 
     of Science.--Section 209 of the Department of Energy 
     Organization Act (42 U.S.C. 7139) is amended to read as 
     follows:


                          ``Office of science

       ``Sec. 209. (a) There shall be within the Department an 
     Office of Science, to be headed by an Assistant Secretary of 
     Science, who shall be appointed by the President, by and with 
     the advice and consent of the Senate, and who shall be 
     compensated at the rate provided for level IV of the 
     Executive Schedule under section 5315 of title 5, United 
     States Code.
       ``(b) The Assistant Secretary of Science shall be in 
     addition to the Assistant Secretaries provided for under 
     section 203 of this Act.
       ``(c) It shall be the duty and responsibility of the 
     Assistant Secretary of Science to

[[Page 7187]]

     carry out the fundamental science and engineering research 
     functions of the Department, including the responsibility for 
     policy and management of such research, as well as other 
     functions vested in the Secretary which he may assign to the 
     Assistant Secretary.''.
       (b) Additional Assistant Secretary Position to Enable 
     Improved Management of Nuclear Energy Issues.--(1) Section 
     203(a) of the Department of Energy Organization Act (42 
     U.S.C. 7133(a)) is amended by striking ``There shall be in 
     the Department six Assistant Secretaries'' and inserting 
     ``Except as provided in section 209, there shall be in the 
     Department seven Assistant Secretaries''.
       (2) It is the sense of the Congress that the leadership for 
     departmental missions in nuclear energy should be at the 
     Assistant Secretary level.
       (c) Technical and Conforming Amendments.--(1) Section 5315 
     of title 5, United States Code, is amended by--
       (A) striking ``Director, Office of Science, Department of 
     Energy.''; and
       (B) striking ``Assistant Secretaries of Energy (6)'' and 
     inserting ``Assistant Secretaries of Energy (8)''.
       (2) The table of contents for the Department of Energy 
     Organization Act (42 U.S.C. 7101 note) is amended--
       (A) by striking ``Section 209'' and inserting ``Sec. 209'';
       (B) by striking ``213.'' and inserting ``Sec. 213.'';
       (C) by striking ``214.'' and inserting ``Sec. 214.'';
       (D) by striking ``215.'' and inserting ``Sec. 215.''; and
       (E) by striking ``216.'' and inserting ``Sec. 216.''.

                TITLE X--DEPARTMENT OF ENERGY MANAGEMENT

     SEC. 1002. 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 other authorities granted to the 
     Secretary under law, the Secretary may exercise the same 
     authority (subject to the same restrictions and conditions) 
     with respect to such research and projects as the Secretary 
     of Defense may exercise under section 2371 of title 10, 
     United States Code, except for subsections (b) and (f) of 
     such section 2371. Such other transactions shall not be 
     subject to the provisions of section 9 of the Federal 
     Nonnuclear Energy Research and Development Act of 1974 (42 
     U.S.C. 5908) or section 152 of the Atomic Energy Act of 1954 
     (42 U.S.C. 2182).
       ``(2)(A) The Secretary may, under the authority of 
     paragraph (1), carry out prototype projects in accordance 
     with the requirements and conditions provided for carrying 
     out prototype projects under section 845 of the National 
     Defense Authorization Act for Fiscal Year 1994 (Public Law 
     103-160; 10 U.S.C. 2371 note), including that, to the maximum 
     extent practicable, competitive procedures shall be used when 
     entering into agreements to carry out projects under 
     subsection (a) of that section and that the period of 
     authority to carry out projects under such subsection (a) 
     terminates as provided in subsection (g) of that section.
       ``(B) In applying the requirements and conditions of 
     section 845 of the National Defense Authorization Act for 
     Fiscal Year 1994 under this subsection--
       ``(i) subsection (c) of that section shall apply with 
     respect to prototype projects carried out under this 
     paragraph; and
       ``(ii) the Director of the Office of Management and Budget 
     shall perform the functions of the Secretary of Defense under 
     subsection (d) of that section.
       ``(C) The Secretary may exercise authority under this 
     subsection for a project only if authorized by the Director 
     of the Office of Management and Budget to use the authority 
     for such project.
       ``(D) The annual report of the head of an executive agency 
     that is required under subsection (h) of section 2371 of 
     title 10, United States Code, as applied to the head of the 
     executive agency by subsection (a), shall be submitted to 
     Congress.
       ``(3) Not later than 90 days after the date of enactment of 
     this subsection, the Secretary, in consultation with the 
     Director of the Office of Management and Budget, shall 
     prescribe guidelines for using other transactions authorized 
     by paragraph (1). Such guidelines shall be published in the 
     Federal Register for public comment under rulemaking 
     procedures of the Department.
       ``(4) 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 and may not be delegated to any other person.
       ``(5)(A) Not later than September 31, 2006, the Comptroller 
     General of the United States shall report to Congress on the 
     Department's use of the authorities granted under this 
     section, including the ability to attract nontraditional 
     government contractors and whether additional safeguards are 
     needed with respect to the use of such authorities.
       ``(B) In this section, the term `nontraditional Government 
     contractor' has the same meaning as the term `nontraditional 
     defense contractor' as defined in section 845(e) of the 
     National Defense Authorization Act for Fiscal Year 1994 
     (Public Law 103-160; 10 U.S.C. 2371 note).''.

     SEC. 1003. UNIVERSITY COLLABORATION.

       Not later than 2 years after the date of enactment of this 
     Act, the Secretary of Energy 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. 1004. SENSE OF CONGRESS.

        It is the sense of the Congress that--
       (1) the Secretary of Energy 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 of Energy; 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 XII--ELECTRICITY

     SEC. 1201. SHORT TITLE.

       This title may be cited as the ``Electric Reliability 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

[[Page 7188]]

     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.

     The total amount of all dues, fees, and other charges 
     collected by the ERO in each of the fiscal years 2006 through 
     2015 and allocated under subparagraph (B) shall not exceed 
     $50,000,000.
       ``(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 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

[[Page 7189]]

     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) Limitation on Annual Appropriations.--There is 
     authorized to be appropriated not more than $50,000,000 per 
     year for fiscal years 2006 through 2015 for all activities 
     under the amendment made by subsection (a).

         Subtitle B--Transmission Infrastructure Modernization

     SEC. 1221. SITING OF INTERSTATE ELECTRIC TRANSMISSION 
                   FACILITIES.

       (a) Amendment of Federal Power Act.--Part II of the Federal 
     Power Act 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) Transmission congestion study.--Within 1 year after 
     the enactment of this section, and every 3 years thereafter, 
     the Secretary of Energy, in consultation with affected 
     States, shall conduct a study of electric transmission 
     congestion. After considering alternatives and 
     recommendations from interested parties, including an 
     opportunity for comment from affected States, the Secretary 
     shall issue a report, based on such 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. The Secretary shall conduct the study 
     and issue the report in consultation with any appropriate 
     regional entity referenced in section 215 of this Act.
       ``(2) Considerations.--In determining whether to designate 
     a national interest electric transmission corridor referred 
     to in paragraph (1) under this section, 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 is authorized, after notice 
     and an opportunity for hearing, to issue a permit or 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 is without 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 pursuant to applicable law seeking 
     approval 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; and
       ``(5) the proposed construction or modification is 
     consistent with sound national energy policy and will enhance 
     energy independence.
       ``(c) Permit Applications.--Permit applications under 
     subsection (b) shall be made in writing to the Commission. 
     The Commission shall issue rules setting forth the form of 
     the application, the information to be contained in the 
     application, and the manner of service of notice of the 
     permit application upon 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.--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 such 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. The practice and 
     procedure in any action or proceeding for that purpose in the 
     district court of the United States shall conform as nearly 
     as may be with the practice and procedure in similar action 
     or proceeding in the courts of the State where the property 
     is situated.
       ``(f) State Law.--Nothing in this section shall preclude 
     any person from constructing or modifying any transmission 
     facility pursuant to State law.
       ``(g) Compensation.--Any exercise of eminent domain 
     authority pursuant to this section shall be considered a 
     taking of private property for which just compensation is 
     due. Just compensation shall be an amount equal to the full 
     fair market value of the property taken on the date of the 
     exercise of eminent domain authority, except that the 
     compensation shall exceed fair market value if necessary to 
     make the landowner whole for decreases in the value of any 
     portion of the land not subject to eminent domain. Any parcel 
     of land acquired by eminent domain under this subsection 
     shall be transferred back to the owner from whom it was 
     acquired (or his heirs or assigns) if the land is not used 
     for the construction or modification of electric transmission 
     facilities within a reasonable period of time after the 
     acquisition. Other than construction, modification, 
     operation, or maintenance of electric transmission facilities 
     and related facilities, property acquired under subsection 
     (e) may not be used for any purpose (including use for any 
     heritage area, recreational trail, or park) without the 
     consent of the owner of the parcel from whom the property was 
     acquired (or the owner's heirs or assigns).
       ``(h) Coordination of Federal Authorizations for 
     Transmission and Distribution Facilities.--
       ``(1) Lead agency.--If an applicant, or prospective 
     applicant, for a Federal authorization related to an electric 
     transmission or distribution facility so requests, the 
     Department of Energy (DOE) shall act as the lead agency for 
     purposes of coordinating all applicable Federal 
     authorizations and related environmental reviews of the 
     facility. For purposes of this subsection, the term `Federal

[[Page 7190]]

     authorization' means any authorization required under Federal 
     law in order to site a transmission or distribution facility, 
     including but not limited to such permits, special use 
     authorizations, certifications, opinions, or other approvals 
     as may be required, whether issued by a Federal or a State 
     agency. To the maximum extent practicable under applicable 
     Federal law, the Secretary of Energy shall coordinate this 
     Federal authorization and review process with any Indian 
     tribes, multi-State 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.
       ``(2) Authority to set deadlines.--As lead agency, the 
     Department of Energy, in consultation with agencies 
     responsible for Federal authorizations and, as appropriate, 
     with Indian tribes, multi-State 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. The Secretary of Energy 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 within 1 year or, if a requirement of 
     another provision of Federal law makes this impossible, as 
     soon thereafter as is practicable. The Secretary of Energy 
     also 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 within 60 days of when the 
     prospective applicant submits a request for such information 
     concerning--
       ``(A) the likelihood of approval for a potential facility; 
     and
       ``(B) key issues of concern to the agencies and public.
       ``(3) Consolidated environmental review and record of 
     decision.--As lead agency head, the Secretary of Energy, 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. The document may be an environmental assessment 
     or environmental impact statement under the National 
     Environmental Policy Act of 1969 if warranted, or such other 
     form of analysis as may be warranted. The Secretary of Energy 
     and the heads of other agencies shall streamline the review 
     and permitting of transmission and distribution facilities 
     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. Such document shall include consideration by 
     the relevant agencies of any applicable criteria or other 
     matters as required under applicable laws.
       ``(4) Appeals.--In the event that any agency has denied a 
     Federal authorization required for a transmission or 
     distribution 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 Secretary, who shall, in consultation with 
     the affected agency, review the denial or take action on the 
     pending application. Based on the overall record and in 
     consultation with the affected agency, the Secretary may then 
     either issue the necessary authorization with any appropriate 
     conditions, or deny the application. The Secretary shall 
     issue a decision within 90 days of the filing of the appeal. 
     In making a decision under this paragraph, the Secretary 
     shall comply with applicable requirements of Federal law, 
     including any requirements of the Endangered Species Act, the 
     Clean Water Act, the National Forest Management Act, the 
     National Environmental Policy Act of 1969, and the Federal 
     Land Policy and Management Act.
       ``(5) Conforming regulations and memoranda of 
     understanding.--Not later than 18 months after the date of 
     enactment of this section, the Secretary of Energy shall 
     issue any regulations necessary to implement this subsection. 
     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 Memoranda of Understanding to ensure the timely and 
     coordinated review and permitting of electricity transmission 
     and distribution facilities. 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 DOE regulations and any Memoranda. 
     Interested Indian tribes, multi-State entities, and State 
     agencies may enter such Memoranda of Understanding.
       ``(6) Duration and renewal.--Each Federal land use 
     authorization for an electricity transmission or distribution 
     facility shall be issued--
       ``(A) for a duration, as determined by the Secretary of 
     Energy, commensurate with the anticipated use of the 
     facility, and
       ``(B) with appropriate authority to manage the right-of-way 
     for reliability and environmental protection.
     Upon the expiration of any such authorization (including an 
     authorization issued prior to enactment of this section), the 
     authorization shall be reviewed for renewal taking fully into 
     account reliance on such electricity infrastructure, 
     recognizing its importance for public health, safety and 
     economic welfare and as a legitimate use of Federal lands.
       ``(7) Maintaining and enhancing the transmission 
     infrastructure.--In exercising the responsibilities under 
     this section, the Secretary of Energy shall consult regularly 
     with the Federal Energy Regulatory Commission (FERC), FERC-
     approved electric reliability organizations (including 
     related regional entities), and FERC-approved Regional 
     Transmission Organizations and Independent System Operators.
       ``(i) Interstate Compacts.--The consent of Congress is 
     hereby given for 3 or more contiguous States to enter into an 
     interstate compact, subject to approval by Congress, 
     establishing regional transmission siting agencies to 
     facilitate siting of future electric energy transmission 
     facilities within such States and to carry out the electric 
     energy transmission siting responsibilities of such States. 
     The Secretary of Energy may provide technical assistance to 
     regional transmission siting agencies established under this 
     subsection. Such 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). The 
     Commission shall have no authority to issue a permit for the 
     construction or modification of electric transmission 
     facilities within a State that is a party to a compact, 
     unless the members of a 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) Savings Clause.--Nothing in this section shall be 
     construed to affect any requirement of the environmental laws 
     of the United States, including, but not limited to, the 
     National Environmental Policy Act of 1969. Subsection (h)(4) 
     of this section shall not apply to any Congressionally-
     designated components of the National Wilderness Preservation 
     System, the National Wild and Scenic Rivers System, or the 
     National Park system (including National Monuments therein).
       ``(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.--The Secretary of the Interior, the Secretary 
     of Energy, the Secretary of Agriculture, and the Chairman of 
     the Council on Environmental Quality shall, within 90 days of 
     the date of enactment of this subsection, submit a joint 
     report to Congress identifying each of the following:
       (1) 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 
     (43 U.S.C. 1761 et seq.), the schedule for completing such 
     work, any impediments to completing the work, and steps that 
     Congress could take to expedite the process.
       (2) The number of pending applications to locate 
     transmission and distribution facilities on Federal lands, 
     key information relating to each such facility, how long each 
     application has been pending, the schedule for issuing a 
     timely decision as to each facility, and progress in 
     incorporating existing and new such rights-of-way into 
     relevant land use and resource management plans or their 
     equivalent.
       (3) The number of existing transmission and distribution 
     rights-of-way on Federal lands that will come up for renewal 
     within the following 5, 10, and 15 year periods, and a 
     description of how the Secretaries plan to manage such 
     renewals.

     SEC. 1222. THIRD-PARTY FINANCE.

       (a) Existing Facilities.--The Secretary of Energy 
     (hereinafter in this section referred to as 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 of Energy, 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

[[Page 7191]]

       (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 Regional 
     Transmission Organization or Independent System Operator (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 Regional 
     Transmission Organization or Independent System Operator, 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) Regional Transmission Organization or 
     Independent System Operator, 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. TRANSMISSION SYSTEM MONITORING.

       Within 6 months after the date of enactment of this Act, 
     the Secretary of Energy 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. 1224. ADVANCED TRANSMISSION TECHNOLOGIES.

       (a) Authority.--The Federal Energy Regulatory Commission, 
     in the exercise of its authorities under the Federal Power 
     Act and the Public Utility Regulatory Policies Act of 1978, 
     shall encourage the deployment of advanced transmission 
     technologies.
       (b) Definition.--For the purposes of this section, the term 
     ``advanced transmission technologies'' means technologies 
     that increase the capacity, efficiency, or reliability of 
     existing or new transmission facilities, including, but not 
     limited to--
       (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, 
     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); and
       (18) any other technologies the Commission considers 
     appropriate.
       (c) Obsolete or Impracticable Technologies.--The Commission 
     is authorized to cease encouraging the deployment of any 
     technology described in this section on a finding that such 
     technology has been rendered obsolete or otherwise 
     impracticable to deploy.

     SEC. 1225. ELECTRIC TRANSMISSION AND DISTRIBUTION PROGRAMS.

       (a) Electric Transmission and Distribution Program.--The 
     Secretary of Energy (hereinafter in this section referred to 
     as the ``Secretary'') acting through the Director of the 
     Office of Electric Transmission and Distribution shall 
     establish a comprehensive research, development, 
     demonstration and commercial application program to promote 
     improved reliability and efficiency of electrical 
     transmission and distribution systems. This program shall 
     include--
       (1) advanced energy delivery and storage technologies, 
     materials, and systems, including new transmission 
     technologies, such as flexible alternating current 
     transmission systems, 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.--Not later than 1 year after the date of 
     the enactment of this legislation, the Secretary, in 
     consultation with other appropriate Federal agencies, shall 
     prepare and transmit to Congress a 5-year program plan to 
     guide activities under this section. In preparing the program 
     plan, the Secretary may consult with utilities, energy 
     services providers, manufacturers, institutions of higher 
     education, other appropriate State and local agencies, 
     environmental organizations, professional and technical 
     societies, and any other persons the Secretary considers 
     appropriate.
       (c) Implementation.--The Secretary shall consider 
     implementing this program using a consortium of industry, 
     university and national laboratory participants.
       (d) Report.--Not later than 2 years after the transmittal 
     of the plan under subsection (b), the Secretary shall 
     transmit a report to Congress describing the progress made 
     under this section and identifying any additional resources 
     needed to continue the development and commercial application 
     of transmission and distribution infrastructure technologies.
       (e) Power Delivery Research Initiative.--
       (1) In general.--The Secretary shall establish a research, 
     development, demonstration, and commercial application 
     initiative specifically focused on power delivery utilizing

[[Page 7192]]

     components incorporating high temperature superconductivity.
       (2) Goals.--The goals of this initiative shall be to--
       (A) establish facilities to develop high temperature 
     superconductivity power applications in partnership with 
     manufacturers and utilities;
       (B) provide technical leadership for establishing 
     reliability for high temperature superconductivity power 
     applications including suitable modeling and analysis;
       (C) facilitate commercial transition toward direct current 
     power transmission, storage, and use for high power systems 
     utilizing high temperature superconductivity; and
       (D) 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) Requirements.--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 universities to demonstrate 
     these technologies, prepare the technologies for commercial 
     introduction, and address cost or performance roadblocks to 
     successful commercial use.
       (4) Authorization of appropriations.--For purposes of 
     carrying out this subsection, there are authorized to be 
     appropriated--
       (A) for fiscal year 2006, $15,000,000;
       (B) for fiscal year 2007, $20,000,000;
       (C) for fiscal year 2008, $30,000,000;
       (D) for fiscal year 2009, $35,000,000; and
       (E) for fiscal year 2010, $40,000,000.

     SEC. 1226. ADVANCED POWER SYSTEM TECHNOLOGY INCENTIVE 
                   PROGRAM.

       (a) Program.--The Secretary of Energy 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 of Energy, 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 of Energy for the purposes of this section, 
     $10,000,000 for each of the fiscal years 2006 through 2012.

     SEC. 1227. OFFICE OF ELECTRIC TRANSMISSION AND DISTRIBUTION.

       (a) Creation of an Office of Electric Transmission and 
     Distribution.--Title II of the Department of Energy 
     Organization Act (42 U.S.C. 7131 et seq.) (as amended by 
     section 502(a) of this Act) is amended by inserting the 
     following after section 217, as added by title V of this Act:

     ``SEC. 218. OFFICE OF ELECTRIC TRANSMISSION AND DISTRIBUTION.

       ``(a) Establishment.--There is established within the 
     Department an Office of Electric Transmission and 
     Distribution. This Office shall be headed by a Director, 
     subject to the authority of the Secretary. The Director shall 
     be appointed by the Secretary. The Director shall be 
     compensated at the annual rate prescribed for level IV of the 
     Executive Schedule under section 5315 of title 5, United 
     States Code.
       ``(b) Director.--The Director shall--
       ``(1) coordinate and develop a comprehensive, multi-year 
     strategy to improve the Nation's electricity transmission and 
     distribution;
       ``(2) implement or, where appropriate, coordinate the 
     implementation of, the recommendations made in the 
     Secretary's May 2002 National Transmission Grid Study;
       ``(3) oversee research, development, and demonstration to 
     support Federal energy policy related to electricity 
     transmission and distribution;
       ``(4) grant authorizations for electricity import and 
     export pursuant to section 202(c), (d), (e), and (f) of the 
     Federal Power Act (16 U.S.C. 824a);
       ``(5) perform other functions, assigned by the Secretary, 
     related to electricity transmission and distribution; and
       ``(6) develop programs for workforce training in power and 
     transmission engineering.''.
       (b) Conforming Amendments.--(1) The table of contents of 
     the Department of Energy Organization Act (42 U.S.C. 7101 
     note) is amended by inserting after the item relating to 
     section 217 the following new item:

``Sec. 218. Office of Electric Transmission and Distribution.''.

       (2) Section 5315 of title 5, United States Code, is amended 
     by inserting after the item relating to ``Inspector General, 
     Department of Energy.'' the following:
       ``Director, Office of Electric Transmission and 
     Distribution, Department of Energy.''.

            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 the following new 
     section:

     ``SEC. 211A. OPEN ACCESS BY UNREGULATED TRANSMITTING 
                   UTILITIES.

       ``(a) Transmission 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 such unregulated 
     transmitting utility provides transmission services to itself 
     and that are not unduly discriminatory or preferential.
       ``(b) Exemption.--The Commission shall exempt from any rule 
     or order under this section any unregulated transmitting 
     utility that--
       ``(1) sells no more than 4,000,000 megawatt hours of 
     electricity per year; or
       ``(2) does not own or operate any transmission facilities 
     that are necessary for operating an interconnected 
     transmission system (or any portion thereof); or
       ``(3) meets other criteria the Commission determines to be 
     in the public interest.
       ``(c) Local Distribution Facilities.--The requirements of 
     subsection (a) shall not apply to facilities used in local 
     distribution.
       ``(d) Exemption Termination.--Whenever the Commission, 
     after an evidentiary hearing held upon 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 (b) unreasonably impairs the continued reliability 
     of an interconnected transmission system, it shall revoke the 
     exemption granted to that transmitting utility.
       ``(e) 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.
       ``(f) Remand.--In exercising its authority under paragraph 
     (1) of subsection (a), the Commission may remand transmission 
     rates to an unregulated transmitting utility for review and 
     revision where necessary to meet the requirements of 
     subsection (a).
       ``(g) Other Requests.--The provision of transmission 
     services under subsection (a) does not preclude a request for 
     transmission services under section 211.
       ``(h) 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 (26 U.S.C. 141).
       ``(i) 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 an RTO 
     or any other Commission-approved independent transmission 
     organization designated to provide nondiscriminatory 
     transmission access.
       ``(j) Definition.--For purposes of 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

[[Page 7193]]

       ``(2) is an entity described in section 201(f).''.

     SEC. 1232. SENSE OF CONGRESS ON REGIONAL TRANSMISSION 
                   ORGANIZATIONS.

       It is the sense of Congress that, in order to promote fair, 
     open access to electric transmission service, benefit retail 
     consumers, facilitate wholesale competition, improve 
     efficiencies in transmission grid management, promote grid 
     reliability, remove opportunities for unduly discriminatory 
     or preferential transmission practices, and provide for the 
     efficient development of transmission infrastructure needed 
     to meet the growing demands of competitive wholesale power 
     markets, all transmitting utilities in interstate commerce 
     should voluntarily become members of Regional Transmission 
     Organizations as defined in section 3 of the Federal Power 
     Act.

     SEC. 1233. REGIONAL TRANSMISSION ORGANIZATION APPLICATIONS 
                   PROGRESS REPORT.

       Not later than 120 days after the date of enactment of this 
     section, the Federal Energy Regulatory Commission shall 
     submit to Congress a report containing each of the following:
       (1) A list of all regional transmission organization 
     applications filed at the Commission pursuant to subpart F of 
     part 35 of title 18, Code of Federal Regulations (in this 
     section referred to as ``Order No. 2000''), including an 
     identification of each public utility and other entity 
     included within the proposed membership of the regional 
     transmission organization.
       (2) A brief description of the status of each pending 
     regional transmission organization application, including a 
     precise explanation of how each fails to comply with the 
     minimal requirements of Order No. 2000 and what steps need to 
     be taken to bring each application into such compliance.
       (3) For any application that has not been finally approved 
     by the Commission, a detailed description of every aspect of 
     the application that the Commission has determined does not 
     conform to the requirements of Order No. 2000.
       (4) For any application that has not been finally approved 
     by the Commission, an explanation by the Commission of why 
     the items described pursuant to paragraph (3) constitute 
     material noncompliance with the requirements of the 
     Commission's Order No. 2000 sufficient to justify denial of 
     approval by the Commission.
       (5) For all regional transmission organization applications 
     filed pursuant to the Commission's Order No. 2000, whether 
     finally approved or not--
       (A) a discussion of that regional transmission 
     organization's efforts to minimize rate seams between itself 
     and--
       (i) other regional transmission organizations; and
       (ii) entities not participating in a regional transmission 
     organization;
       (B) a discussion of the impact of such seams on consumers 
     and wholesale competition; and
       (C) a discussion of minimizing cost-shifting on consumers.

     SEC. 1234. FEDERAL UTILITY PARTICIPATION IN REGIONAL 
                   TRANSMISSION ORGANIZATIONS.

       (a) Definitions.--For purposes of this section--
       (1) Appropriate federal regulatory authority.--The term 
     ``appropriate Federal regulatory authority'' means--
       (A) with respect to a Federal power marketing agency (as 
     defined in the Federal Power Act), the Secretary of Energy, 
     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 that Federal power marketing agency; and
       (B) with respect to the Tennessee Valley Authority, the 
     Board of Directors of the Tennessee Valley Authority.
       (2) Federal utility.--The term ``Federal utility'' means a 
     Federal power marketing agency or the Tennessee Valley 
     Authority.
       (3) Transmission system.--The term ``transmission system'' 
     means electric transmission facilities owned, leased, or 
     contracted for by the United States and operated by a Federal 
     utility.
       (b) Transfer.--The appropriate Federal regulatory authority 
     is authorized to enter into a contract, agreement or other 
     arrangement transferring control and use of all or part of 
     the Federal utility's transmission system to an RTO or ISO 
     (as defined in the Federal Power Act), approved by the 
     Federal Energy Regulatory Commission. Such 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 necessary or appropriate, including standards that 
     assure recovery of all the Federal utility's costs and 
     expenses related to the transmission facilities that are the 
     subject of the contract, agreement or other arrangement; 
     consistency with existing contracts and third-party financing 
     arrangements; and consistency with said Federal utility's 
     statutory authorities, obligations, and limitations;
       (2) provisions for monitoring and oversight by the Federal 
     utility of the RTO's or ISO's fulfillment of the 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 regional 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 RTO or ISO and terminate the contract, agreement or 
     other arrangement in accordance with its terms.

     Neither this section, actions taken pursuant to it, nor any 
     other transaction of a Federal utility using an RTO or ISO 
     shall confer upon the Federal Energy Regulatory Commission 
     jurisdiction or authority over the Federal utility's electric 
     generation assets, electric capacity or energy that the 
     Federal utility is authorized by law to market, or the 
     Federal utility's power sales activities.
       (c) Existing Statutory and Other Obligations.--
       (1) System operation requirements.--No statutory provision 
     requiring or authorizing a Federal utility to transmit 
     electric power or to construct, operate or maintain its 
     transmission system shall be construed to prohibit a transfer 
     of control and use of its transmission system pursuant to, 
     and subject to all requirements of subsection (b).
       (2) Other obligations.--This subsection shall not be 
     construed to--
       (A) suspend, or exempt any Federal utility from, any 
     provision of existing Federal law, including but not limited 
     to any requirement or direction relating to the use of the 
     Federal utility's transmission system, environmental 
     protection, fish and wildlife protection, flood control, 
     navigation, water delivery, or recreation; or
       (B) authorize abrogation of any contract or treaty 
     obligation.
       (3) Repeal.--Section 311 of title III of Appendix B of the 
     Act of October 27, 2000 (P.L. 106-377, section 1(a)(2); 114 
     Stat. 1441, 1441A-80; 16 U.S.C. 824n) is repealed.

     SEC. 1235. STANDARD MARKET DESIGN.

       (a) Remand.--The Commission's proposed rulemaking entitled 
     ``Remedying Undue Discrimination through Open Access 
     Transmission Service and Standard Electricity Market Design'' 
     (Docket No. RM01-12-000) (``SMD NOPR'') is remanded to the 
     Commission for reconsideration. No final rule mandating a 
     standard electricity market design pursuant to the proposed 
     rulemaking, including any rule or order of general 
     applicability within the scope of the proposed rulemaking, 
     may be issued before October 31, 2006, or take effect before 
     December 31, 2006. Any final rule issued by the Commission 
     pursuant to the proposed rulemaking shall be preceded by a 
     second notice of proposed rulemaking issued after the date of 
     enactment of this Act and an opportunity for public comment.
       (b) Savings Clause.--This section shall not be construed to 
     modify or diminish any authority or obligation the Commission 
     has under this Act, the Federal Power Act, or other 
     applicable law, including, but not limited to, any authority 
     to--
       (1) issue any rule or order (of general or particular 
     applicability) pursuant to any such authority or obligation; 
     or
       (2) act on a filing or filings by 1 or more transmitting 
     utilities for the voluntary formation of a Regional 
     Transmission Organization or Independent System Operator (as 
     defined in the Federal Power Act) (and related market 
     structures or rules) or voluntary modification of an existing 
     Regional Transmission Organization or Independent System 
     Operator (and related market structures or rules).

     SEC. 1236. NATIVE LOAD SERVICE OBLIGATION.

       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) Meeting Service Obligations.--(1) 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 such generation facilities or such 
     purchased energy to meet such service obligation,
     is entitled to use such firm transmission rights, or, 
     equivalent tradable or financial transmission rights, in 
     order to deliver such output or purchased energy, or the 
     output of other generating facilities or purchased energy to 
     the extent deliverable using such rights, to the extent 
     required to meet its service obligation.
       ``(2) To the extent that all or a portion of the service 
     obligation covered by such 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. Subsequent transfers to another load-serving 
     entity, or back to the original load-

[[Page 7194]]

     serving entity, shall be entitled to the same rights.
       ``(3) The Commission shall exercise its authority 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 their service 
     obligations, 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.
       ``(b) Allocation of Transmission Rights.--Nothing in 
     subsections (a)(1) and (a) (2) of this section shall affect 
     any existing or future methodology employed by an RTO or ISO 
     for allocating or auctioning transmission rights if such RTO 
     or ISO 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 an RTO or ISO never allocated financial 
     transmission rights on its system that pertained to a period 
     before January 1, 2005, with respect to any application by 
     such RTO or ISO that would change its methodology the 
     Commission shall exercise its authority in a manner 
     consistent with the Act and the policies expressed in 
     subsections (a)(1) and (a)(2) 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.
       ``(c) Certain Transmission Rights.--The Commission may 
     exercise authority under this Act to make transmission rights 
     not used to meet an obligation covered by subsection (a) 
     available to other entities in a manner determined by the 
     Commission to be just, reasonable, and not unduly 
     discriminatory or preferential.
       ``(d) Obligation to Build.--Nothing in this Act shall 
     relieve a load-serving entity from any obligation under State 
     or local law to build transmission or distribution facilities 
     adequate to meet its service obligations.
       ``(e) 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 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.
       ``(f) 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 such 
     facilities, protections for transmission service comparable 
     to those provided to load-serving entities pursuant to this 
     section.
       ``(g) 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 
     subsection (a)(3) in Commission-approved RTOs and ISOs with 
     organized electricity markets.
       ``(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 its 
     jurisdiction.
       ``(j) Effect of Exercising Rights.--An entity that lawfully 
     exercises rights granted under subsection (a) shall not be 
     considered by such action as engaging in undue discrimination 
     or preference under this Act.
       ``(k) TVA Area.--For purposes of subsection (a)(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 deemed to hold firm transmission rights 
     for the transmission of such power.
       ``(l) Definitions.--For purposes of 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 which 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''.

     SEC. 1237. STUDY ON THE BENEFITS OF ECONOMIC DISPATCH.

       (a) Study.--The Secretary of Energy, 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 of Energy 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.

                  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. 218. TRANSMISSION INFRASTRUCTURE INVESTMENT.

       ``(a) Rulemaking Requirement.--Within 1 year after the 
     enactment of this section, the Commission shall establish, by 
     rule, incentive-based (including, but not limited to 
     performance-based) rate treatments for the transmission of 
     electric energy in interstate commerce by public utilities 
     for the purpose of benefiting consumers by ensuring 
     reliability and reducing the cost of delivered power by 
     reducing transmission congestion. Such 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 facilities for the transmission 
     of electric energy in interstate commerce;
       ``(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 
     such facilities; and
       ``(4) allow recovery of all prudently incurred costs 
     necessary to comply with mandatory reliability standards 
     issued pursuant to section 215 of this Act.
     The Commission may, from time to time, revise such rule.
       ``(b) Additional Incentives for RTO Participation.--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 
     Regional Transmission Organization or Independent System 
     Operator. Incentives provided by the Commission pursuant to 
     such rule shall include--
       ``(1) recovery of all prudently incurred costs to develop 
     and participate in any proposed or approved RTO, ISO, or 
     independent transmission company;
       ``(2) recovery of all costs previously approved by a State 
     commission which exercised jurisdiction over the transmission 
     facilities prior to the utility's participation in the RTO or 
     ISO, including costs necessary to honor preexisting 
     transmission service contracts, in a manner which does not 
     reduce the revenues the utility receives for transmission 
     services for a reasonable transition period after the utility 
     joins the RTO or ISO;
       ``(3) recovery as an expense in rates of the costs 
     prudently incurred to conduct transmission planning and 
     reliability activities, including the costs of participating 
     in RTO, ISO and other regional planning activities and 
     design, study and other precertification costs involved in 
     seeking permits and approvals for proposed transmission 
     facilities;
       ``(4) a current return in rates for construction work in 
     progress for transmission facilities and full recovery of 
     prudently incurred costs for constructing transmission 
     facilities;
       ``(5) formula transmission rates; and
       ``(6) a maximum 15 year accelerated depreciation on new 
     transmission facilities for rate treatment purposes.

     The Commission shall ensure that any costs recoverable 
     pursuant to this subsection may be recovered by such utility 
     through the

[[Page 7195]]

     transmission rates charged by such utility or through the 
     transmission rates charged by the RTO or ISO that provides 
     transmission service to such utility.
       ``(c) Just and Reasonable Rates.--All rates approved under 
     the rules adopted pursuant to this section, including any 
     revisions to such rules, are subject to the requirement of 
     sections 205 and 206 that all rates, charges, terms, and 
     conditions be just and reasonable and not unduly 
     discriminatory or preferential.''.

                    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 Utilities 
     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
       ``(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 Utilities 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

[[Page 7196]]

     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 of Energy 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 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

[[Page 7197]]

     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:
       ``(16) 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:
       ``(3)(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 (16) 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 (16) of section 
     111(d).''.
       (2) Failure to comply.--Section 112 (d) f 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 (16), 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 (16).''.
       (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 (16) 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 paragraph (16) 
     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 (16).''.

                      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

[[Page 7198]]

     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.--The term ``holding company'' means--
       (A) 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
       (B) 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.
       (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.
       (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;

[[Page 7199]]

       (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.).

     SEC. 1272. IMPLEMENTATION.

       Not later than 12 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 12 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) 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 in order to assure that each 
     allocation is appropriate for the protection of investors and 
     consumers of such public utility.
       (b) Cost Allocation.--Nothing in this section shall 
     preclude the Commission or a State commission from exercising 
     its jurisdiction under other applicable law with respect to 
     the review or authorization of any costs allocated to a 
     public utility in a holding company system located in the 
     affected State as a result of the acquisition of non-power 
     goods or administrative and management services by such 
     public utility from an associate company organized 
     specifically for that purpose.
       (c) Rules.--Not later than 6 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.
       (d) Public Utility.--As used in this section, the term 
     ``public utility'' has the meaning given that term in section 
     201(e) of the Federal Power Act.

     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. MARKET TRANSPARENCY RULES.

       Part II of the Federal Power Act (16 U.S.C. 824 et seq.) is 
     amended by adding at the end the following:

     ``SEC. 220. MARKET TRANSPARENCY RULES.

       ``(a) In General.--Not later than 180 days after the date 
     of enactment of this section, the Commission shall issue 
     rules establishing an electronic information system to 
     provide the Commission and the public with access to such 
     information as is necessary or appropriate to facilitate 
     price transparency and participation in markets subject to 
     the Commission's jurisdiction under this Act. Such systems 
     shall provide information about the availability and market 
     price of wholesale electric energy and transmission services 
     to the Commission, State commissions, buyers and sellers of 
     wholesale electric energy, users of transmission services, 
     and the public on a timely basis. The Commission shall have 
     authority to obtain such information from any electric 
     utility or transmitting utility, including any entity 
     described in section 201(f).
       ``(b) Exemptions.--The Commission shall exempt from 
     disclosure information it determines would, if disclosed, be 
     detrimental to the operation of an effective market or 
     jeopardize system security. This section shall not apply to 
     transactions for the purchase or sale of wholesale electric 
     energy or transmission services within the area described in 
     section 212(k)(2)(A). In determining the information to be 
     made available under this section and time to make such 
     information available, the Commission shall seek to ensure 
     that consumers and competitive markets are protected from the 
     adverse effects of potential collusion or other anti-
     competitive behaviors that can be facilitated by untimely 
     public disclosure of transaction-specific information.
       ``(c) Commodity Futures Trading Commission.--This section 
     shall not affect the exclusive jurisdiction of the Commodity 
     Futures Trading Commission with respect to accounts, 
     agreements, contracts, or transactions in commodities under 
     the Commodity Exchange Act (7 U.S.C. 1 et seq.).
       ``(d) Savings Provision.--In exercising its authority under 
     this section, the Commission shall not--
       ``(1) compete with, or displace from the market place, any 
     price publisher; or
       ``(2) regulate price publishers or impose any requirements 
     on the publication of information.''.

     SEC. 1282. 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. 221. PROHIBITION ON FILING FALSE INFORMATION.

       ``No person or other 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 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 such 
     Federal agency.

     ``SEC. 222. PROHIBITION ON ROUND TRIP TRADING.

       ``(a) Prohibition.--No person or other entity (including an 
     entity described in section 201(f)) shall willfully and 
     knowingly enter into any contract or other arrangement to 
     execute a `round trip trade' for the purchase or sale of 
     electric energy at wholesale.
       ``(b) Definition.--For the purposes of this section, the 
     term `round trip trade' means a transaction, or combination 
     of transactions, in which a person or any other entity--
       ``(1) enters into a contract or other arrangement to 
     purchase from, or sell to, any other person or other entity 
     electric energy at wholesale;
       ``(2) simultaneously with entering into the contract or 
     arrangement described in paragraph (1), arranges a 
     financially offsetting trade with such other person or entity 
     for the same such electric energy, at the same location, 
     price, quantity and terms so that, collectively, the purchase 
     and sale transactions in themselves result in no financial 
     gain or loss; and
       ``(3) enters into the contract or arrangement with a 
     specific intent to fraudulently affect reported revenues, 
     trading volumes, or prices.''.

     SEC. 1283. ENFORCEMENT.

       (a) Complaints.--Section 306 of the Federal Power Act (16 
     U.S.C. 825e) is amended as follows:
       (1) By inserting ``electric utility,'' after ``Any 
     person,''.
       (2) By inserting ``, transmitting utility,'' after 
     ``licensee'' each place it appears.

[[Page 7200]]

       (b) Review of Commission Orders.--Section 313(a) of the 
     Federal Power Act (16 U.S.C. 8251) 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''.
       (c) Investigations.--Section 307(a) of the Federal Power 
     Act (16 U.S.C. 825f(a)) is amended as follows:
       (1) By inserting ``, electric utility, transmitting 
     utility, or other entity'' after ``person'' each time it 
     appears.
       (2) By striking the period at the end of the first sentence 
     and inserting 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.''.
       (d) Criminal Penalties.--Section 316 of the Federal Power 
     Act (16 U.S.C. 825o) is amended--
       (1) in subsection (a), by striking ``$5,000'' and inserting 
     ``$1,000,000'', and 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 as follows:
       (1) In subsections (a) and (b), by striking ``section 211, 
     212, 213, or 214'' each place it appears and inserting ``Part 
     II''.
       (2) In subsection (b), by striking ``$10,000'' and 
     inserting ``$1,000,000''.

     SEC. 1284. 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. 1285. REFUND AUTHORITY.

       Section 206 of the Federal Power Act (16 U.S.C. 824e) is 
     amended by adding the following new subsection at the end 
     thereof:
       ``(e)(1) Except as provided in paragraph (2), if an entity 
     described in section 201(f) voluntarily makes a short-term 
     sale of electric energy and the sale violates Commission 
     rules in effect at the time of the sale, such entity shall be 
     subject to the Commission's refund authority under this 
     section with respect to such violation.
       ``(2) This section shall not apply to--
       ``(A) any entity that sells less than 8,000,000 megawatt 
     hours of electricity per year; or
       ``(B) any electric cooperative.
       ``(3) For purposes of this subsection, 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).
       ``(4) The Commission shall have refund authority under 
     subsection (e)(1) with respect to a voluntary short-term sale 
     of electric energy by the Bonneville Power Administration (in 
     this section `Bonneville') only if the sale is at an unjust 
     and unreasonable rate and, in that event, may order a refund 
     only for short-term sales made by Bonneville 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 Bonneville.
       ``(5) With respect to any Federal power marketing agency or 
     the Tennessee Valley Authority, the Commission shall not 
     assert or exercise any regulatory authority or powers under 
     subsection (e)(1) other than the ordering of refunds to 
     achieve a just and reasonable rate.''.

     SEC. 1286. SANCTITY OF CONTRACT.

       (a) In General.--The Federal Energy Regulatory Commission 
     (in this section, ``the Commission'') shall have no authority 
     to abrogate or modify any provision of an executed contract 
     or executed contract amendment described in subsection (b) 
     that has been entered into or taken effect, except upon a 
     finding that failure to take such action would be contrary to 
     the public interest.
       (b) Limitation.--Except as provided in subsection (c), this 
     section shall apply only to a contract or contract 
     amendment--
       (1) executed on or after the date of enactment of this Act; 
     and
       (2) entered into--
       (A) for the purchase or sale of electric energy under 
     section 205 of the Federal Power Act (16 U.S.C. 824d) where 
     the seller has been authorized by the Commission to charge 
     market-based rates; or
       (B) under section 4 of the Natural Gas Act (15 U.S.C. 717c) 
     where the natural gas company has been authorized by the 
     Commission to charge market-based rates for the service 
     described in the contract.
       (c) Exclusion.--This section shall not apply to an executed 
     contract or executed contract amendment that expressly 
     provides for a standard of review other than the public 
     interest standard.
       (d) Savings Provision.--With respect to contracts to which 
     this section does not apply, nothing in this section alters 
     existing law regarding the applicable standard of review for 
     a contract subject to the jurisdiction of the Commission.

     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).

                       Subtitle H--Merger Reform

     SEC. 1291. MERGER REVIEW REFORM AND ACCOUNTABILITY.

       (a) Merger Review Reform.--Within 180 days after the date 
     of enactment of this Act, the Secretary of Energy, in 
     consultation with the Federal Energy Regulatory Commission 
     and the Attorney General of the United States, shall prepare, 
     and transmit to Congress each of the following:
       (1) A study of the extent to which the authorities vested 
     in the Federal Energy Regulatory Commission under section 203 
     of the Federal Power Act are duplicative of authorities 
     vested in--
       (A) other agencies of Federal and State Government; and
       (B) the Federal Energy Regulatory Commission, including 
     under sections 205 and 206 of the Federal Power Act.
       (2) Recommendations on reforms to the Federal Power Act 
     that would eliminate any unnecessary duplication in the 
     exercise of regulatory authority or unnecessary delays in the 
     approval (or disapproval) of applications for the sale, 
     lease, or other disposition of public utility facilities.
       (b) Merger Review Accountability.--Not later than 1 year 
     after the date of enactment of this Act and annually 
     thereafter, with respect to all orders issued within the 
     preceding year that impose a condition on a sale, lease, or 
     other disposition of public utility facilities under section 
     203(b) of the Federal Power Act, the Federal Energy 
     Regulatory Commission shall transmit a report to Congress 
     explaining each of the following:
       (1) The condition imposed.
       (2) Whether the Commission could have imposed such 
     condition by exercising its authority under any provision of 
     the Federal Power Act other than under section 203(b).
       (3) If the Commission could not have imposed such condition 
     other than under section 203(b), why the Commission 
     determined that such condition was consistent with the public 
     interest.

     SEC. 1292. ELECTRIC UTILITY MERGERS.

       (a) Amendment.--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; or
       ``(C) purchase, acquire, or take any security with a value 
     in excess of $10,000,000 of any other public utility.
       ``(2) No holding company in a holding company system that 
     includes a public utility shall purchase, acquire, or take 
     any security with a value in excess of $10,000,000 of, or, by

[[Page 7201]]

     any means whatsoever, directly or indirectly, merge or 
     consolidate with, a public utility or a holding company in a 
     holding company system that includes a public utility 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. In evaluating whether a transaction will be 
     consistent with the public interest, the Commission shall 
     consider whether the proposed transaction--
       ``(A) will adequately protect consumer interests;
       ``(B) will be consistent with competitive wholesale 
     markets;
       ``(C) will impair the financial integrity of any public 
     utility that is a party to the transaction or an associate 
     company of any party to the transaction; and
       ``(D) satisfies such other criteria as the Commission 
     considers 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 12 months after the date of enactment of 
     this section.

                        Subtitle I--Definitions

     SEC. 1295. DEFINITIONS.

       (a) Electric Utility.--Section 3(22) of the Federal Power 
     Act (16 U.S.C. 796(22)) is amended to read as follows:
       ``(22) Electric utility.--The term `electric utility' means 
     any person or Federal or State agency (including any entity 
     described in section 201(f)) that sells electric energy; such 
     term includes the Tennessee Valley Authority and each Federal 
     power marketing administration.''.
       (b) Transmitting Utility.--Section 3(23) of the Federal 
     Power Act (16 U.S.C. 796(23)) is amended to read as follows:
       ``(23) Transmitting utility.--The term `transmitting 
     utility' means an entity, including any entity described in 
     section 201(f), that owns, operates, or controls facilities 
     used for the transmission of electric energy--
       ``(A) in interstate commerce; or
       ``(B) for the sale of electric energy at wholesale.''.
       (c) Additional Definitions.--Section 3 of the Federal Power 
     Act (16 U.S.C. 796) is amended 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 to exercise operational or 
     functional control of facilities used for the transmission of 
     electric energy in interstate commerce and to ensure 
     nondiscriminatory access to such facilities.
       ``(28) ISO.--The term `Independent System Operator' or 
     `ISO' means an entity approved by the Commission to exercise 
     operational or functional control of facilities used for the 
     transmission of electric energy in interstate commerce and to 
     ensure nondiscriminatory access to such facilities.''.
       (d) Commission.--For the purposes of this title, the term 
     ``Commission'' means the Federal Energy Regulatory 
     Commission.
       (e) Applicability.--Section 201(f) of the Federal Power Act 
     (16 U.S.C. 824(f)) is amended by adding after ``political 
     subdivision of a state,'' the following: ``an electric 
     cooperative that has 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 J--Technical and Conforming Amendments

     SEC. 1297. CONFORMING AMENDMENTS.

       The Federal Power Act is amended as follows:
       (1) Section 201(b)(2) of such Act (16 U.S.C. 824(b)(2)) is 
     amended as follows:
       (A) In the first sentence 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''.
       (B) In the second sentence by striking ``210 or 211'' and 
     inserting ``203(a)(2), 206(e), 210, 211, 211A, 212, 215, 216, 
     217, 218, 219, 220, 221, and 222''.
       (C) Section 201(b)(2) of such Act is amended by striking 
     ``The'' in the first place it appears and inserting 
     ``Notwithstanding section 201(f), the'' and in the second 
     sentence after ``any order'' by inserting ``or rule''.
       (2) Section 201(e) of such Act is amended by striking 
     ``210, 211, or 212'' and inserting ``206(e), 206(f), 210, 
     211, 211A, 212, 215, 216, 217, 218, 219, 220, 221, and 222''.
       (3) Section 206 of such Act (16 U.S.C. 824e) is amended as 
     follows:
       (A) In subsection (b), in the seventh sentence, by striking 
     ``the public utility to make''.
       (B) In the first sentence of subsection (a), by striking 
     ``hearing had'' and inserting ``hearing held''.
       (4) Section 211(c) of such Act (16 U.S.C. 824j(c)) is 
     amended by--
       (A) striking ``(2)'';
       (B) striking ``(A)'' and inserting ``(1)''
       (C) striking ``(B)'' and inserting ``(2)''; and
       (D) striking ``termination of modification'' and inserting 
     ``termination or modification''.
       (5) Section 211(d)(1) of such Act (16 U.S.C. 824j(d)(1)) is 
     amended by striking ``electric utility'' the second time it 
     appears and inserting ``transmitting utility''.
       (6) Section 315 (c) of such Act (16 U.S.C. 825n(c)) is 
     amended by striking ``subsection'' and inserting ``section''.

                     Subtitle K--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 BOARD ON ECONOMIC DISPATCH.

       ``(a) In General.--The Commission shall convene a joint 
     board pursuant to section 209 of this Act to study the issue 
     of security constrained economic dispatch for a market 
     region.
       ``(b) Membership.--The Commission shall request each State 
     to nominate a representative for such joint board.
       ``(c) Powers.--The board's sole authority 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.
       ``(d) Report to the Congress.--The board shall issue a 
     report on these matters within one year of enactment of this 
     section, including any consensus recommendations for 
     statutory or regulatory reform.''.

                   TITLE XIII--ENERGY TAX INCENTIVES

     SEC. 1300. SHORT TITLE; ETC.

       (a) Short Title.--This title may be cited as the ``Enhanced 
     Energy Infrastructure and Technology Tax 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--Energy Infrastructure Tax Incentives

     SEC. 1301. 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, 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) is amended by inserting after the item relating 
     to subparagraph (C)(iii) the following:

``(C) (iv)........................................................14''.

       (d) Alternative Minimum Tax Exception.--Subparagraph (B) of 
     section 56(a)(1) is

[[Page 7202]]

     amended by inserting before the period the following: ``, or 
     in section 168(e)(3)(C)(iv)''.
       (e) Effective Date.--The amendments made by this section 
     shall apply to property placed in service after April 11, 
     2005.

     SEC. 1302. NATURAL GAS DISTRIBUTION LINES 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 natural gas distribution line.''.
       (b) Alternative System.--The table contained in section 
     168(g)(3)(B) is amended by inserting after the item relating 
     to subparagraph (E)(vi) the following:

``(E) (vii).......................................................35''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to property placed in service after April 11, 
     2005.

     SEC. 1303. ELECTRIC TRANSMISSION PROPERTY TREATED AS 15-YEAR 
                   PROPERTY.

       (a) In General.--Subparagraph (E) of section 168(e)(3) 
     (relating to classification of certain property), as amended 
     by section 1302 of this title, is amended by striking ``and'' 
     at the end of clause (vi), by striking the period at the end 
     of clause (vii) and inserting ``, and'', and by adding at the 
     end the following new clause:
       ``(viii) 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) is amended by inserting after the item relating 
     to subparagraph (E)(vii) the following:

``(E) (viii)......................................................30''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to property placed in service after April 11, 
     2005.

     SEC. 1304. 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, paragraph (1) shall be applied without regard to the 
     phrase `in operation before January 1, 1976'.''.
       (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) Technical Amendment.--Section 169(d)(3) is amended by 
     striking ``Health, Education, and Welfare'' and inserting 
     ``Health and Human Services''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to facilities placed in service after April 11, 
     2005.

     SEC. 1305. 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 45J and by moving section 
     45J (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) is 
     amended by striking ``plus'' at the end of paragraph (18), by 
     striking the period at the end of paragraph (19) and 
     inserting ``, plus'', and by adding at the end the following:
       ``(20) the nonconventional source production credit 
     determined under section 45J(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 45J(d)(2)(C)''.
       (C) Section 45(e)(9) is amended--
       (i) by striking ``section 29'' and inserting ``section 
     45J'', and
       (ii) by inserting ``(or under section 29, as in effect on 
     the day before the date of enactment of the Enhanced Energy 
     Infrastructure and Technology Tax 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 45J(d)(5))'', and
       (ii) in subsection (d)(3) by striking ``section 29'' both 
     places it appears and inserting ``section 45J''.
       (E) Section 45J(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 45J(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. 45J. Credit for producing fuel from a nonconventional source.''.

       (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)) 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) and (g) as subsections (e) and (f), 
     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. 1306. 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 the 
     Enhanced Energy Infrastructure and Technology Tax Act of 
     2005.
       ``(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

[[Page 7203]]

     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 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) 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.
       (d) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2005.

     SEC. 1307. 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. 1308. 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.

            Subtitle B--Miscellaneous Energy Tax Incentives

     SEC. 1311. 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) is 
     amended by inserting after section 25B the following new 
     section:

     ``SEC. 25C. 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) 15 percent of the qualified solar water heating 
     property expenditures made by the taxpayer during such year,
       ``(2) 15 percent of the qualified photovoltaic property 
     expenditures made by the taxpayer during such year, and

[[Page 7204]]

       ``(3) 15 percent of the qualified fuel cell property 
     expenditures made by the taxpayer during such year.
       ``(b) Limitations.--
       ``(1) Maximum credit.--
       ``(A) In general.--The credit allowed under subsection (a) 
     shall not exceed--
       ``(i) $2,000 for solar water heating property described in 
     subsection (c)(1),
       ``(ii) $2,000 for photovoltaic property described in 
     subsection (c)(2), and
       ``(iii) $500 for each 0.5 kilowatt of capacity of property 
     described in subsection (c)(3).
       ``(B) Prior expenditures by taxpayer on same residence 
     taken into account.--In determining the amount of the credit 
     allowed to a taxpayer with respect to any dwelling unit under 
     this section, the dollar amounts under clauses (i) and (ii) 
     of subparagraph (A) with respect to each type of property 
     described in such clauses shall be reduced by the credit 
     allowed to the taxpayer under this section with respect to 
     such type of property for all preceding taxable years with 
     respect to such dwelling unit.
       ``(2) Property standards.--No credit shall be allowed under 
     this section for an item of property unless--
       ``(A) the original use of such property commences with the 
     taxpayer,
       ``(B) such property can be reasonably expected to remain in 
     use for at least 5 years,
       ``(C) such property is installed on or in connection with a 
     dwelling unit located in the United States and used as a 
     residence by the taxpayer,
       ``(D) in the case of solar water heating property, such 
     property is certified for performance by the non-profit Solar 
     Rating and Certification Corporation or a comparable entity 
     endorsed by the government of the State in which such 
     property is installed, and
       ``(E) in the case of fuel cell property, such property 
     meets the performance and quality standards (if any) which 
     have been prescribed by the Secretary by regulations (after 
     consultation with the Secretary of Energy).
       ``(c) 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 which uses solar energy to 
     heat water for use in a dwelling unit.
       ``(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 and which is not 
     described in paragraph (1).
       ``(3) Qualified fuel cell property expenditure.--The term 
     `qualified fuel cell property expenditure' means an 
     expenditure for any qualified fuel cell property (as defined 
     in section 48(b)(1)).
       ``(d) Special Rules.--For purposes of this section--
       ``(1) 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 (c) solely because it 
     constitutes a structural component of the structure on which 
     it is installed.
       ``(2) 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.
       ``(3) 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 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 (c).
       ``(4) 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 the individual's 
     tenant-stockholder's proportionate share (as defined in 
     section 216(b)(3)) of any expenditures of such corporation.
       ``(5) 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.
       ``(6) 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.
       ``(7) 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.
       ``(C) Amount.--The amount of any expenditure shall be the 
     cost thereof.
       ``(8) 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)).
       ``(e) 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.
       ``(f) Termination.--The credit allowed under this section 
     shall not apply to taxable years beginning 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 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. Residential energy efficient property.''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to expenditures made after the date of the 
     enactment of this Act.

     SEC. 1312. CREDIT FOR BUSINESS INSTALLATION OF QUALIFIED FUEL 
                   CELLS.

       (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,''.
       (b) Energy Percentage.--Subparagraph (A) of section 
     48(a)(2) (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, 15 
     percent, and
       ``(ii) in the case of any other energy property, 10 
     percent.''.
       (c) Qualified Fuel Cell Property.--Section 48 (relating to 
     energy credit) is amended--
       (1) by redesignating subsection (b) as paragraph (5) of 
     subsection (a),
       (2) by striking ``subsection (a)'' in paragraph (5) of 
     subsection (a), as redesignated by paragraph (1), and 
     inserting ``this subsection'', and
       (3) by adding at the end the following new subsection:
       ``(b) Qualified Fuel Cell Property.--For purposes of 
     subsection (a)(3)(A)(iii)--
       ``(1) In general.--The term `qualified fuel cell property' 
     means a fuel cell power plant which--
       ``(A) generates at least 0.5 kilowatt of electricity using 
     an electrochemical process, and
       ``(B) has an electricity-only generation efficiency greater 
     than 30 percent.
       ``(2) Limitation.--The energy credit with respect to any 
     qualified fuel cell property shall not exceed an amount equal 
     to $500 for each 0.5 kilowatt of capacity of such property.
       ``(3) 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.
       ``(4) Termination.--The term `qualified fuel cell property' 
     shall not include any property placed in service after 
     December 31, 2007.''.
       (d) Conforming Amendment.--Section 48(a)(1) is amended by 
     inserting ``except as

[[Page 7205]]

     provided in subsection (b)(2),'' before ``the energy'' the 
     first place it appears.
       (e) Effective Date.--The amendments made by this section 
     shall apply to property placed in service after April 11, 
     2005, 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. 1313. 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 16.9 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'.''.
       (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.''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect on January 1, 2006.

     SEC. 1314. AMORTIZATION OF DELAY RENTAL PAYMENTS.

       (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 Delay Rental Payments for Domestic 
     Oil and Gas Wells.--
       ``(1) In general.--Any delay rental payment paid or 
     incurred in connection with the development of oil or gas 
     wells 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 payment was paid or 
     incurred.
       ``(2) Half-year convention.--For purposes of paragraph (1), 
     any payment paid or incurred 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 to which 
     a delay rental payment relates 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.
       ``(5) Delay rental payments.--For purposes of this 
     subsection, the term `delay rental payment' means an amount 
     paid for the privilege of deferring development of an oil or 
     gas well under an oil or gas lease.''.
       (b) 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.

     SEC. 1315. AMORTIZATION OF GEOLOGICAL AND GEOPHYSICAL 
                   EXPENDITURES.

       (a) In General.--Section 167 (relating to depreciation), as 
     amended by section 1314 of this title, is amended by 
     redesignating subsection (i) as subsection (j) and by 
     inserting after subsection (h) the following new subsection:
       ``(i) 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) Special rules.--For purposes of this subsection, 
     rules similar to the rules of paragraphs (2), (3), and (4) of 
     subsection (h) shall apply.''.
       (b) Conforming Amendment.--Section 263A(c)(3) is amended by 
     inserting ``167(h), 167(i),'' 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.

     SEC. 1316. ADVANCED LEAN BURN TECHNOLOGY MOTOR VEHICLE 
                   CREDIT.

       (a) In General.--Subpart B of part IV of subchapter A of 
     chapter 1 (relating to other credits) is amended by adding at 
     the end the following:

     ``SEC. 30B. ADVANCED LEAN BURN TECHNOLOGY 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 the credit amounts 
     determined under subsection (b) with respect to each 
     qualified advanced lean burn technology motor vehicle placed 
     in service by the taxpayer during the taxable year.
       ``(b) Credit Amount.--For purposes of subsection (a)--
       ``(1) Fuel efficiency.--The credit amount with respect to 
     any vehicle shall be--
       ``(A) $500, if the city fuel economy of such vehicle is at 
     least 125 percent but less than 150 percent of the 2000 model 
     year city fuel economy for a vehicle in the same inertia 
     weight class,
       ``(B) $1,000, if the city fuel economy of such vehicle is 
     at least 150 percent but less than 175 percent of the 2000 
     model year city fuel economy for a vehicle in the same 
     inertia weight class,
       ``(C) $1,500, if the city fuel economy of such vehicle is 
     at least 175 percent but less than 200 percent of the 2000 
     model year city fuel economy for a vehicle in the same 
     inertia weight class,
       ``(D) $2,000, if the city fuel economy of such vehicle is 
     at least 200 percent but less than 225 percent of the 2000 
     model year city fuel economy for a vehicle in the same 
     inertia weight class,
       ``(E) $2,500, if the city fuel economy of such vehicle is 
     at least 225 percent but less than 250 percent of the 2000 
     model year city fuel economy for a vehicle in the same 
     inertia weight class, and
       ``(F) $3,000, if the city fuel economy of such vehicle is 
     at least 250 percent of the 2000 model year city fuel economy 
     for a vehicle in the same inertia weight class.
       ``(2) Conservation.--The credit amount determined under 
     paragraph (1) with respect to any vehicle shall be increased 
     by--
       ``(A) $250, if the lifetime fuel savings of such vehicle is 
     at least 1,500 gallons of motor fuel but less than 2,500 
     gallons of motor fuel, and
       ``(B) $500, if the lifetime fuel savings of such vehicle is 
     at least 2,500 gallons of motor fuel.
       ``(c) Limitation Based on Amount of Tax.--The credit 
     allowed under subsection (a) for the 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 subpart A and 
     sections 27 and 30A for the taxable year.
       ``(d) Definitions.--For purposes of this section--
       ``(1) Qualified advanced lean burn technology motor 
     vehicle.--The term `qualified advanced lean burn technology 
     motor vehicle' means a motor vehicle--
       ``(A) the original use of which commences with the 
     taxpayer,
       ``(B) powered by an internal combustion engine that--
       ``(i) is designed to operate primarily using more air than 
     is necessary for complete combustion of the fuel, and
       ``(ii) incorporates direct injection,
       ``(C) that only uses diesel fuel (as defined in section 
     4083(a)(3)),
       ``(D) the city fuel economy of which is at least 125 
     percent of the 2000 model year city fuel economy for a 
     vehicle in the same inertia weight class, and
       ``(E) that has received a certificate that such vehicle 
     meets or exceeds the Bin 8 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.
       ``(2) Lifetime fuel savings.--The term `lifetime fuel 
     savings' means, with respect to a qualified advanced lean 
     burn technology motor vehicle, an amount equal to the excess 
     (if any) of--
       ``(A) 120,000 divided by the 2000 model year city fuel 
     economy for the vehicle inertia weight class, over

[[Page 7206]]

       ``(B) 120,000 divided by the city fuel economy for such 
     vehicle.
       ``(3) 2000 model year city fuel economy.--The 2000 model 
     year city fuel economy with respect to a vehicle shall be 
     determined in accordance with the following tables:
       ``(A) In the case of a passenger automobile:
The 2000 model year city fuel economy is:
1,500 or 1,750 lbs.........................................43.7 mpg.

2,000 lbs..................................................38.3 mpg.

2,250 lbs..................................................34.1 mpg.

2,500 lbs..................................................30.7 mpg.

2,750 lbs..................................................27.9 mpg.

3,000 lbs..................................................25.6 mpg.

3,500 lbs..................................................22.0 mpg.

4,000 lbs..................................................19.3 mpg.

4,500 lbs..................................................17.2 mpg.

5,000 lbs..................................................15.5 mpg.

5,500 lbs..................................................14.1 mpg.

6,000 lbs..................................................12.9 mpg.

6,500 lbs..................................................11.9 mpg.

7,000 or 8,500 lbs........................................11.1 mpg..

       ``(B) In the case of a light truck:
The 2000 model year city fuel economy is:
1,500 or 1,750 lbs.........................................37.6 mpg.

2,000 lbs..................................................33.7 mpg.

2,250 lbs..................................................30.6 mpg.

2,500 lbs..................................................28.0 mpg.

2,750 lbs..................................................25.9 mpg.

3,000 lbs..................................................24.1 mpg.

3,500 lbs..................................................21.3 mpg.

4,000 lbs..................................................19.0 mpg.

4,500 lbs..................................................17.3 mpg.

5,000 lbs..................................................15.8 mpg.

5,500 lbs..................................................14.6 mpg.

6,000 lbs..................................................13.6 mpg.

6,500 lbs..................................................12.8 mpg.

7,000 or 8,500 lbs........................................12.0 mpg..

       ``(4) Motor vehicle.--The term `motor vehicle' has the 
     meaning given such term by section 30(c)(2).
       ``(5) City fuel economy.--City fuel economy with respect to 
     any vehicle shall be measured in accordance with testing and 
     calculation procedures established by the Administrator of 
     the Environmental Protection Agency by regulations in effect 
     on April 11, 2005.
       ``(6) Other terms.--The terms `passenger automobile', 
     `light truck', and `manufacturer' shall 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.).
       ``(e) Carryforward Allowed.--
       ``(1) In general.--If the credit amount allowable under 
     subsection (a) for a taxable year exceeds the amount of the 
     limitation under subsection (c) for such taxable year 
     (referred to as the `unused credit year' in this paragraph), 
     such excess shall be allowed as a credit carryforward for 
     each of the 20 taxable years following the unused credit 
     year.
       ``(2) Rules.--Rules similar to the rules of section 39 
     shall apply with respect to the credit carryforward under 
     paragraph (1).
       ``(f) Special Rules.--For purposes of this section--
       ``(1) Reduction in basis.--The basis of any property for 
     which a credit is allowable under subsection (a) shall be 
     reduced by the amount of such credit (determined without 
     regard to subsection (c)).
       ``(2) No double benefit.--The amount of any deduction or 
     credit allowable under this chapter (other than the credit 
     allowable under subsection (a)), with respect to any vehicle 
     shall be reduced by the amount of credit allowed under 
     subsection (a) (determined without regard to subsection (c)) 
     for such vehicle for the taxable year.
       ``(3) 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 (c)).
       ``(4) 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.
       ``(5) Election not to take credit.--No credit shall be 
     allowed under subsection (a) for any vehicle if the taxpayer 
     elects not to have this section apply to such vehicle.
       ``(6) 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.
       ``(g) Regulations.--
       ``(1) In general.--The Secretary shall promulgate such 
     regulations as necessary to carry out this section, including 
     regulations to prevent the avoidance of the purposes of this 
     section through disposal of any motor vehicle or leasing of 
     any motor vehicle for a lease period of less than the 
     economic life of such vehicle.
       ``(2) Determination of motor vehicle eligibility.--The 
     Secretary, 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.
       ``(h) Termination.--This section shall not apply to any 
     property placed in service after December 31, 2007.''.
       (b) Conforming Amendments.--
       (1) Section 1016(a), as amended by section 1311 of this 
     title, 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:
       ``(33) to the extent provided in section 30B(f)(1).''.
       (2) Section 6501(m) is amended by inserting ``30B(f)(6),'' 
     after ``30(d)(4),''.
       (3) 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:

``Sec. 30B. Advanced lean burn technology motor vehicle credit.''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to property placed in service after the date of 
     the enactment of this Act in taxable years ending after such 
     date.

     SEC. 1317. CREDIT FOR ENERGY EFFICIENCY IMPROVEMENTS TO 
                   EXISTING HOMES.

       (a) In General.--Subpart A of part IV of subchapter A of 
     chapter 1 (relating to nonrefundable personal credits), as 
     amended by section 1311, is amended by inserting after 
     section 25C the following new section:

     ``SEC. 25D. ENERGY EFFICIENCY IMPROVEMENTS TO EXISTING HOMES.

       ``(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 20 
     percent of the amount paid or incurred by the taxpayer for 
     qualified energy efficiency improvements installed during 
     such taxable year.
       ``(b) Limitations.--
       ``(1) Maximum credit.--The credit allowed by this section 
     with respect to a dwelling unit shall not exceed $2,000.
       ``(2) Prior credit amounts for taxpayer on same dwelling 
     taken into account.--If a credit was allowed to the taxpayer 
     under subsection (a) with respect to a dwelling unit in 1 or 
     more prior taxable years, the amount of the credit otherwise 
     allowable for the taxable year with respect to that dwelling 
     unit shall be reduced by the sum of the credits allowed under 
     subsection (a) to the taxpayer with respect to the dwelling 
     unit for all prior taxable years.
       ``(c) Qualified Energy Efficiency Improvements.--For 
     purposes of this section, 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 the Enhanced Energy 
     Infrastructure and Technology Tax Act of 2005 (or, in the 
     case of a metal roof with appropriate pigmented coatings 
     which meet the Energy Star program requirements), if--
       ``(1) 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),
       ``(2) the original use of such component commences with the 
     taxpayer, and
       ``(3) such component reasonably can be expected to remain 
     in use for at least 5 years.
     If the aggregate cost of such components with respect to any 
     dwelling unit exceeds

[[Page 7207]]

     $1,000, such components shall be treated as qualified energy 
     efficiency improvements only if such components are also 
     certified in accordance with subsection (d) as meeting such 
     prescriptive criteria.
       ``(d) Certification.--The certification described in 
     subsection (c) shall be--
       ``(1) determined on the basis of the technical 
     specifications or applicable ratings (including product 
     labeling requirements) for the measurement of energy 
     efficiency (based upon energy use or building envelope 
     component performance) for the energy efficient building 
     envelope component,
       ``(2) provided by a local building regulatory authority, a 
     utility, a manufactured home production inspection primary 
     inspection agency (IPIA), or an accredited home energy rating 
     system provider who is accredited by or otherwise authorized 
     to use approved energy performance measurement methods by the 
     Residential Energy Services Network (RESNET), and
       ``(3) made in writing in a manner which specifies in 
     readily verifiable fashion the energy efficient building 
     envelope components installed and their respective energy 
     efficiency levels.
       ``(e) Definitions and Special Rules.--For purposes of this 
     section--
       ``(1) 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.
       ``(2) 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).
       ``(3) Application of rules.--Rules similar to the rules 
     under paragraphs (3), (4), and (5) of section 25C(d) shall 
     apply.
       ``(f) Basis Adjustment.--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) Application of Section.--This section shall apply to 
     qualified energy efficiency improvements installed after the 
     date of the enactment of the Enhanced Energy Infrastructure 
     and Technology Tax Act of 2005, and before January 1, 
     2008.''.
       (b) Conforming Amendments.--
       (1) Subsection (a) of section 1016, as amended by section 
     1316 of this title, 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 25D(f), in the 
     case of amounts with respect to which a credit has been 
     allowed under section 25D.''.
       (2) The table of sections for subpart A of part IV of 
     subchapter A of chapter 1, as amended by section 1311, is 
     amended by inserting after the item relating to section 25C 
     the following new item:

``Sec. 25D. Energy efficiency improvements to existing homes.''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to improvements installed after the date of the 
     enactment of this Act in taxable years ending after such 
     date.

               Subtitle C--Alternative Minimum Tax Relief

     SEC. 1321. NEW NONREFUNDABLE PERSONAL CREDITS ALLOWED AGAINST 
                   REGULAR AND MINIMUM TAXES.

       (a) In General.--
       (1) Section 25c.--Section 25C(b), as added by section 1311 
     of this title, is amended by adding at the end the following 
     new paragraph:
       ``(3) Limitation based on amount of tax.--The credit 
     allowed under subsection (a) for the taxable year shall not 
     exceed the excess of--
       ``(A) the sum of the regular tax liability (as defined in 
     section 26(b)) plus the tax imposed by section 55, over
       ``(B) the sum of the credits allowable under this subpart 
     (other than this section) and section 27 for the taxable 
     year.''.
       (2) Section 25d.--Section 25D(b), as added by section 1317 
     of this title, is amended by adding at the end the following 
     new paragraph:
       ``(3) Limitation based on amount of tax.--The credit 
     allowed under subsection (a) for the taxable year shall not 
     exceed the excess of--
       ``(A) the sum of the regular tax liability (as defined in 
     section 26(b)) plus the tax imposed by section 55, over
       ``(B) the sum of the credits allowable under this subpart 
     (other than this section) and section 27 for the taxable 
     year.''.
       (b) Conforming Amendments.--
       (1) Section 23(b)(4)(B) is amended by inserting ``and 
     sections 25C and 25D'' after ``this section''.
       (2) Section 24(b)(3)(B) is amended by striking ``and 25B'' 
     and inserting ``, 25B, 25C, and 25D''.
       (3) Section 25(e)(1)(C) is amended by inserting ``25C, and 
     25D'' after ``25B,''.
       (4) Section 25B(g)(2) is amended by striking ``section 23'' 
     and inserting ``sections 23, 25C, and 25D''.
       (5) Section 26(a)(1) is amended by striking ``and 25B'' and 
     inserting ``25B, 25C, and 25D''.
       (6) Section 904(i) is amended by striking ``and 25B'' and 
     inserting ``25B, 25C, and 25D''.
       (7) Section 1400C(d) is amended by striking ``and 25B'' and 
     inserting ``25B, 25C, and 25D''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2005.

     SEC. 1322. CERTAIN BUSINESS ENERGY CREDITS ALLOWED AGAINST 
                   REGULAR AND MINIMUM TAXES.

       (a) In General.--Subparagraph (B) of section 38(c)(4) 
     (relating to specified credits) is amended by redesignating 
     clause (ii) as clause (iv) and by striking clause (i) and 
     inserting the following new clauses:
       ``(i) the credits determined under sections 40, 45H, and 
     45I,
       ``(ii) so much of the credit determined under section 46 as 
     is attributable to section 48(a)(3)(A)(iii),
       ``(iii) for taxable years beginning after December 31, 
     2005, and before January 1, 2008, the credit determined under 
     section 43, and''.
       (b) Effective Dates.--
       (1) In general.--Except as provided by paragraph (2), the 
     amendment made by subsection (a) shall apply to credits 
     determined under the Internal Revenue Code of 1986 for 
     taxable years beginning after December 31, 2005.
       (2) Fuel cells.--Clause (ii) of section 38(c)(4)(B) of the 
     Internal Revenue Code of 1986, as amended by subsection (a) 
     of this section, shall apply to credits determined under the 
     Internal Revenue Code of 1986 for taxable years ending after 
     April 11, 2005.

                        TITLE XIV--MISCELLANEOUS

                      Subtitle C--Other Provisions

     SEC. 1441. CONTINUATION OF TRANSMISSION SECURITY ORDER.

       Department of Energy Order No. 202-03-2, issued by the 
     Secretary of Energy on August 28, 2003, shall remain in 
     effect unless rescinded by Federal statute.

     SEC. 1442. REVIEW OF AGENCY DETERMINATIONS.

       Section 7 of the Natural Gas Act (15 U.S.C. 717f) is 
     amended by adding at the end the following:
       ``(i)(1) The United States Court of Appeals for the 
     District of Columbia Circuit shall have original and 
     exclusive jurisdiction over any civil action--
       ``(A) for review of any order or action of any Federal or 
     State administrative agency or officer to issue, condition, 
     or deny any permit, license, concurrence, or approval issued 
     under authority of any Federal law, other than the Coastal 
     Zone Management Act of 1972 (16 U.S.C. 1451 et seq.), 
     required for the construction of a natural gas pipeline for 
     which a certificate of public convenience and necessity is 
     issued by the Commission under this section;
       ``(B) alleging unreasonable delay by any Federal or State 
     administrative agency or officer in entering an order or 
     taking other action described in subparagraph (A); or
       ``(C) challenging any decision made or action taken under 
     this subsection.
       ``(2)(A) If the Court finds that the order, action, or 
     failure to act is not consistent with the public convenience 
     and necessity (as determined by the Commission under this 
     section), or would prevent the construction and operation of 
     natural gas facilities authorized by the certificate of 
     public convenience and necessity, the permit, license, 
     concurrence, or approval that is the subject of the order, 
     action, or failure to act shall be deemed to have been issued 
     subject to any conditions set forth in the reviewed order or 
     action that the Court finds to be consistent with the public 
     convenience and necessity.
       ``(B) For purposes of paragraph (1)(B), the failure of an 
     agency or officer to issue any such permit, license, 
     concurrence, or approval within the later of 1 year after the 
     date of filing of an application for the permit, license, 
     concurrence, or approval or 60 days after the date of 
     issuance of the certificate of public convenience and 
     necessity under this section, shall be considered to be 
     unreasonable delay unless the Court, for good cause shown, 
     determines otherwise.
       ``(C) The Court shall set any action brought under 
     paragraph (1) for expedited consideration.''.

     SEC. 1443. ATTAINMENT DATES FOR DOWNWIND OZONE NONATTAINMENT 
                   AREAS.

       Section 181 of the Clean Air Act (42 U.S.C.7511) is amended 
     by adding the following new subsection at the end thereof:
       ``(d) Extended Attainment Date for Certain Downwind 
     Areas.--
       ``(1) Definitions.--(A) The term `upwind area' means an 
     area that--
       ``(i) significantly contributes to nonattainment in another 
     area, hereinafter referred to as a `downwind area'; and
       ``(ii) is either--
       ``(I) a nonattainment area with a later attainment date 
     than the downwind area, or

[[Page 7208]]

       ``(II) an area in another State that the Administrator has 
     found to be significantly contributing to nonattainment in 
     the downwind area in violation of section 110(a)(2)(D) and 
     for which the Administrator has established requirements 
     through notice and comment rulemaking to eliminate the 
     emissions causing such significant contribution.
       ``(B) The term `current classification' means the 
     classification of a downwind area under this section at the 
     time of the determination under paragraph (2).
       ``(2) Extension.--If the Administrator--
       ``(A) determines that any area is a downwind area with 
     respect to a particular national ambient air quality standard 
     for ozone; and
       ``(B) approves a plan revision for such area as provided in 
     paragraph (3) prior to a reclassification under subsection 
     (b)(2)(A),
     the Administrator, in lieu of such reclassification, shall 
     extend the attainment date for such downwind area for such 
     standard in accordance with paragraph (5).
       ``(3) Required approval.--In order to extend the attainment 
     date for a downwind area under this subsection, the 
     Administrator must approve a revision of the applicable 
     implementation plan for the downwind area for such standard 
     that--
       ``(A) complies with all requirements of this Act applicable 
     under the current classification of the downwind area, 
     including any requirements applicable to the area under 
     section 172(c) for such standard; and
       ``(B) includes any additional measures needed to 
     demonstrate attainment by the extended attainment date 
     provided under this subsection.
       ``(4) Prior reclassification determination.--If, no more 
     than 18 months prior to the date of enactment of this 
     subsection, the Administrator made a reclassification 
     determination under subsection (b)(2)(A) for any downwind 
     area, and the Administrator approves the plan revision 
     referred to in paragraph (3) for such area within 12 months 
     after the date of enactment of this subsection, the 
     reclassification shall be withdrawn and the attainment date 
     extended in accordance with paragraph (5) upon such approval. 
     The Administrator shall also withdraw a reclassification 
     determination under subsection (b)(2)(A) made after the date 
     of enactment of this subsection and extend the attainment 
     date in accordance with paragraph (5) if the Administrator 
     approves the plan revision referred to in paragraph (3) 
     within 12 months of the date the reclassification 
     determination under subsection (b)(2)(A) is issued. In such 
     instances the `current classification' used for evaluating 
     the revision of the applicable implementation plan under 
     paragraph (3) shall be the classification of the downwind 
     area under this section immediately prior to such 
     reclassification.
       ``(5) Extended date.--The attainment date extended under 
     this subsection shall provide for attainment of such national 
     ambient air quality standard for ozone in the downwind area 
     as expeditiously as practicable but no later than the date on 
     which the last reductions in pollution transport necessary 
     for attainment in the downwind area are required to be 
     achieved by the upwind area or areas.''.

     SEC. 1444. 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--
       (1) 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,
       (2) electricity from a renewable source such as wind, 
     solar, or biomass, or
       (3) ethanol.
       (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. 1446. 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 as 
     defined under section 2(a)(1)(A) of the Edible Oil Regulatory 
     Reform Act (33 U.S.C. 2720(a)(1)(A)).

     SEC. 1447. 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. RISK ASSESSMENT.

       ``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. 1448. OXYGEN-FUEL.

       (a) Program.--The Secretary of Energy 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. Cost sharing shall not be 
     required.
       (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.

     SEC. 1449. PETROCHEMICAL AND OIL REFINERY FACILITY HEALTH 
                   ASSESSMENT.

       (a) Establishment.--The Secretary of Energy 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. 1450. UNITED STATES-ISRAEL COOPERATION.

       (a) Findings.--The Congress finds that--
       (1) on February 1, 1996, United States Secretary of Energy 
     Hazel R. O'Leary and Israeli Minister of Energy and 
     Infrastructure Gonen Segev signed the Agreement between the 
     Department of Energy of the United States of America and the 
     Ministry of Energy and Infrastructure of Israel Concerning 
     Energy Cooperation, 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 one 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.--(1) The Secretary of Energy shall 
     report to the Committee on Energy and Commerce of the House 
     of Representatives and the Committee on Energy and Natural 
     Resources of the Senate on--
       (A) how the United States and Israel have cooperated on 
     energy research and development activities under the 
     Agreement;
       (B) projects initiated pursuant to the Agreement; and
       (C) plans for future cooperation and joint projects under 
     the Agreement.
       (2) The report shall be submitted no later than three 
     months after the date of enactment of this Act.
       (c) Sense of Congress.--It is the sense of the Congress 
     that energy cooperation between the Governments of the United 
     States and Israel is mutually beneficial in the development 
     of energy technology.

     SEC. 1451. CARBON-BASED FUEL CELL DEVELOPMENT.

       (a) Grant Authority.--The Secretary of Energy is authorized 
     to make a single grant to a qualified institution to design 
     and fabricate a 5-kilowatt prototype coal-based fuel cell 
     with the following performance objectives:
       (1) A current density of 600 milliamps per square 
     centimeter at a cell voltage of 0.8 volts.
       (2) An operating temperature range not to exceed 900 
     degrees celsius.
       (b) Qualified Institution.--For the purposes of subsection 
     (a), a qualified institution is a research-intensive 
     institution of

[[Page 7209]]

     higher education with demonstrated expertise in the 
     development of carbon-based fuel cells allowing the direct 
     use of high sulfur content coal as fuel, and which has 
     produced a laboratory-scale carbon-based fuel cell with a 
     proven current density of 100 milliamps per square centimeter 
     at a voltage of 0.6 volts.
       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary of Energy for carrying 
     out this section $850,000 for fiscal year 2006.

                   TITLE XV--ETHANOL AND MOTOR FUELS

                     Subtitle A--General Provisions

     SEC. 1501. RENEWABLE CONTENT OF MOTOR VEHICLE FUEL.

       (a) In General.--Section 211 of the Clean Air Act (42 
     U.S.C. 7545) is amended--
       (1) by redesignating subsection (o) as subsection (q); and
       (2) by inserting after subsection (n) the following:
       ``(o) Renewable Fuel Program.--
       ``(1) Definitions.--In this section:
       ``(A) Ethanol.--(i) 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; and
       ``(VI) fibers.
       ``(ii) 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.
       ``(B) Renewable fuel.--
       ``(i) In general.--The term `renewable fuel' means motor 
     vehicle fuel that--

       ``(I)(aa) is produced from grain, starch, oilseeds, 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 
     cellulosic biomass ethanol, waste derived ethanol, and 
     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).
       ``(C) Small refinery.--The term `small refinery' means a 
     refinery for which average aggregate daily crude oil 
     throughput for the 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) In general.--Not later than 1 year after the 
     enactment of this subsection, the Administrator shall 
     promulgate regulations ensuring that motor vehicle fuel sold 
     or dispensed to consumers in the contiguous United States, on 
     an annual average basis, contains the applicable volume of 
     renewable fuel as specified in subparagraph (B). Regardless 
     of the date of promulgation, such regulations shall contain 
     compliance provisions for refiners, blenders, and importers, 
     as appropriate, to ensure that the requirements of this 
     section are met, but shall not restrict where renewable fuel 
     can be used, or impose any per-gallon obligation for the use 
     of renewable fuel. If the Administrator does not promulgate 
     such regulations, the applicable percentage referred to in 
     paragraph (4), on a volume percentage of gasoline basis, 
     shall be 2.2 in 2005.
       ``(B) Applicable volume.--
       ``(i) Calendar years 2005 through 2012.--For the purpose of 
     subparagraph (A), the applicable volume for any of calendar 
     years 2005 through 2012 shall be determined in accordance 
     with the following table:
                                    Applicable volume of renewable fuel
  ``Calendar year                              (in billions of gallons)
  2005..............................................................3.1
  2006..............................................................3.3
  2007..............................................................3.5
  2008..............................................................3.8
  2009..............................................................4.1
  2010..............................................................4.4
  2011..............................................................4.7
  2012..............................................................5.0
       ``(ii) Calendar year 2013 and thereafter.--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) 5.0 billion gallons of renewable fuels; bears to
       ``(bb) the number of gallons of gasoline sold or introduced 
     into commerce in calendar year 2012.
       ``(3) Non-contiguous state opt-in.--Upon the petition of a 
     non-contiguous State, the Administrator may allow the 
     renewable fuel program established by subtitle A of title XV 
     of the Energy Policy Act of 2005 to apply in such non-
     contiguous State at the same time or any time after the 
     Administrator promulgates regulations under paragraph (2). 
     The Administrator may promulgate or revise regulations under 
     paragraph (2), establish applicable percentages under 
     paragraph (4), provide for the generation of credits under 
     paragraph (6), and take such other actions as may be 
     necessary to allow for the application of the renewable fuels 
     program in a non-contiguous State.
       ``(4) 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 of the volumes of 
     gasoline that will be sold or introduced into commerce in the 
     United States during the following calendar year.
       ``(B) Determination of applicable percentages.--
       ``(i) In general.--Not later than November 30 of each of 
     the calendar years 2005 through 2011, based on the estimate 
     provided under subparagraph (A), the Administrator 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 refiners, blenders, and importers, 
     as appropriate;
       ``(II) be expressed in terms of a volume percentage of 
     gasoline sold or introduced into commerce; 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 to 
     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 (11).
       ``(5) Equivalency.--For the purpose of paragraph (2), 1 
     gallon of either cellulosic biomass ethanol or waste derived 
     ethanol--
       ``(A) shall be considered to be the equivalent of 1.5 
     gallon of renewable fuel; or
       ``(B) if the cellulostic biomass ethanol or waste derived 
     ethanol is derived from agricultural residue or wood residue 
     or is an agricultural byproduct (as that term is used in 
     section 919 of the Energy Policy Act of 2005), shall be 
     considered to be the equivalent of 2.5 gallons of renewable 
     fuel.
       ``(6) Credit program.--
       ``(A) In general.--The regulations promulgated to carry out 
     this subsection shall provide 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). Such regulations shall provide for the 
     generation of an appropriate amount of credits for biodiesel 
     fuel. If a small refinery notifies the Administrator that it 
     waives the exemption provided paragraph (11), the regulations 
     shall provide for the generation of credits by the small 
     refinery beginning in the year following such notification.
       ``(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) Life of credits.--A credit generated under this 
     paragraph shall be valid to show compliance--
       ``(i) in the calendar year in which the credit was 
     generated or the next calendar year; or
       ``(ii) in the calendar year in which the credit was 
     generated or next two consecutive calendar years if the 
     Administrator promulgates regulations under paragraph (7).
       ``(D) Inability to purchase sufficient credits.--The 
     regulations promulgated to carry out this subsection shall 
     include provisions allowing any person that is unable to 
     generate or purchase sufficient credits to meet the 
     requirements under paragraph (2) to carry forward a renewable 
     fuel deficit provided that, in the calendar year following 
     the year in which the renewable fuel deficit is created, such 
     person shall achieve compliance with the renewable fuel 
     requirement under paragraph (2), and shall generate or 
     purchase additional renewable fuel credits to offset the 
     renewable fuel deficit of the previous year.
       ``(7) Seasonal variations in renewable fuel use.--
       ``(A) Study.--For each of the calendar years 2005 through 
     2012, the Administrator of the Energy Information 
     Administration shall conduct a study of renewable fuels 
     blending to determine whether there are excessive seasonal 
     variations in the use of renewable fuels.

[[Page 7210]]

       ``(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 shall promulgate 
     regulations to ensure that 35 percent or more of the quantity 
     of renewable fuels necessary to meet the requirement of 
     paragraph (2) is used during each of the periods specified in 
     subparagraph (D) of each subsequent calendar year.
       ``(C) Determinations.--The determinations referred to in 
     subparagraph (B) are that--
       ``(i) less than 35 percent of the quantity of renewable 
     fuels necessary to meet the requirement of paragraph (2) has 
     been used during one of the 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 35 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 two periods referred to in this 
     paragraph are--
       ``(i) April through September; and
       ``(ii) January through March and October through December.
       ``(E) Exclusions.--Renewable fuels blended or consumed in 
     2005 in a State which has received a waiver under section 
     209(b) shall not be included in the study in subparagraph 
     (A).
       ``(8) Waivers.--
       ``(A) In general.--The Administrator, in consultation with 
     the Secretary of Agriculture and the Secretary of Energy, may 
     waive the requirement of paragraph (2) in whole or in part on 
     petition by one or more States by reducing the national 
     quantity of renewable fuel required under this subsection--
       ``(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 or distribution capacity to meet 
     the requirement.
       ``(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 requirement 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.
       ``(9) Study and waiver for initial year of program.--Not 
     later than 180 days after the enactment of this subsection, 
     the Secretary of Energy shall complete for the Administrator 
     a study assessing whether the renewable fuels requirement 
     under paragraph (2) will likely result in significant adverse 
     consumer impacts in 2005, on a national, regional, or State 
     basis. Such study shall evaluate renewable fuel supplies and 
     prices, blendstock supplies, and supply and distribution 
     system capabilities. Based on such study, the Secretary shall 
     make specific recommendations to the Administrator regarding 
     waiver of the requirements of paragraph (2), in whole or in 
     part, to avoid any such adverse impacts. Within 270 days 
     after the enactment of this subsection, the Administrator 
     shall, consistent with the recommendations of the Secretary, 
     waive, in whole or in part, the renewable fuels requirement 
     under paragraph (2) by reducing the national quantity of 
     renewable fuel required under this subsection in 2005. This 
     paragraph shall not be interpreted as limiting the 
     Administrator's authority to waive the requirements of 
     paragraph (2) in whole, or in part, under paragraph (8) or 
     paragraph (10), pertaining to waivers.
       ``(10) Assessment and waiver.--The Administrator, in 
     consultation with the Secretary of Energy and the Secretary 
     of Agriculture, shall evaluate the requirement of paragraph 
     (2) and determine, prior to January 1, 2007, and prior to 
     January 1 of any subsequent year in which the applicable 
     volume of renewable fuel is increased under paragraph (2)(B), 
     whether the requirement of paragraph (2), including the 
     applicable volume of renewable fuel contained in paragraph 
     (2)(B) should remain in effect, in whole or in part, during 
     2007 or any year or years subsequent to 2007. In evaluating 
     the requirement of paragraph (2) and in making any 
     determination under this section, the Administrator shall 
     consider the best available information and data collected by 
     accepted methods or best available means regarding--
       ``(A) the capacity of renewable fuel producers to supply an 
     adequate amount of renewable fuel at competitive prices to 
     fulfill the requirement of paragraph (2);
       ``(B) the potential of the requirement of paragraph (2) to 
     significantly raise the price of gasoline, food (excluding 
     the net price impact on the requirement in paragraph (2) on 
     commodities used in the production of ethanol), or heating 
     oil for consumers in any significant area or region of the 
     country above the price that would otherwise apply to such 
     commodities in the absence of such requirement;
       ``(C) the potential of the requirement of paragraph (2) to 
     interfere with the supply of fuel in any significant gasoline 
     market or region of the country, including interference with 
     the efficient operation of refiners, blenders, importers, 
     wholesale suppliers, and retail vendors of gasoline, and 
     other motor fuels; and
       ``(D) the potential of the requirement of paragraph (2) to 
     cause or promote exceedances of Federal, State, or local air 
     quality standards.
     If the Administrator determines, by clear and convincing 
     information, after public notice and the opportunity for 
     comment, that the requirement of paragraph (2) would have 
     significant and meaningful adverse impact on the supply of 
     fuel and related infrastructure or on the economy, public 
     health, or environment of any significant area or region of 
     the country, the Administrator may waive, in whole or in 
     part, the requirement of paragraph (2) in any one year for 
     which the determination is made for that area or region of 
     the country, except that any such waiver shall not have the 
     effect of reducing the applicable volume of renewable fuel 
     specified in paragraph (2)(B) with respect to any year for 
     which the determination is made. In determining economic 
     impact under this paragraph, the Administrator shall not 
     consider the reduced revenues available from the Highway 
     Trust Fund (section 9503 of the Internal Revenue Code of 
     1986) as a result of the use of ethanol.
       ``(11) Small refineries.--
       ``(A) In general.--The requirement of paragraph (2) shall 
     not apply to small refineries until the first calendar year 
     beginning more than 5 years after the first year set forth in 
     the table in paragraph (2)(B)(i). Not later than December 31, 
     2007, the Secretary of Energy shall complete for the 
     Administrator a study to determine whether the requirement of 
     paragraph (2) would impose a disproportionate economic 
     hardship on small refineries. For any small refinery that the 
     Secretary of Energy determines would experience a 
     disproportionate economic hardship, the Administrator shall 
     extend the small refinery exemption for such small refinery 
     for no less than two additional years.
       ``(B) Economic hardship.--
       ``(i) Extension of exemption.--A small refinery may at any 
     time petition the Administrator for an extension of the 
     exemption from the requirement of paragraph (2) for the 
     reason of disproportionate economic hardship. In evaluating a 
     hardship petition, the Administrator, in consultation with 
     the Secretary of Energy, shall consider the findings of the 
     study in addition to other economic factors.
       ``(ii) 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 receipt 
     of the petition.
       ``(C) Credit program.--If a small refinery notifies the 
     Administrator that it waives the exemption provided by this 
     Act, the regulations shall provide for the generation of 
     credits by the small refinery beginning in the year following 
     such notification.
       ``(D) Opt-in for small refiners.--A small refinery shall be 
     subject to the requirements of this section if it notifies 
     the Administrator that it waives the exemption under 
     subparagraph (A).
       ``(12) Ethanol market concentration analysis.--
       ``(A) Analysis.--
       ``(i) In general.--Not later than 180 days after the date 
     of enactment of this subsection, 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 as follows:
       (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)''.
       (2) In the first sentence of paragraph (2), by striking 
     ``and (n)'' each place it appears and inserting ``(n), and 
     (o)''.
       (c) Survey of Renewable Fuel Market.--
       (1) Survey and report.--Not later than December 1, 2006, 
     and annually thereafter, the Administrator of the 
     Environmental

[[Page 7211]]

     Protection Agency (in consultation with the Secretary of 
     Energy 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. FUELS SAFE HARBOR.

       (a) In General.--Notwithstanding any other provision of 
     Federal or State law, no renewable fuel, as defined by 
     section 211(o)(1) of the Clean Air Act, or methyl tertiary 
     butyl ether (hereafter in this section referred to as 
     ``MTBE''), used or intended to be used as a motor vehicle 
     fuel, nor any motor vehicle fuel containing such renewable 
     fuel or MTBE, shall be deemed a defective product by virtue 
     of the fact that it is, or contains, such a renewable fuel or 
     MTBE, if it does not violate a control or prohibition imposed 
     by the Administrator of the Environmental Protection Agency 
     (hereinafter in this section referred to as the 
     ``Administrator'') under section 211 of such Act, and the 
     manufacturer is in compliance with all requests for 
     information under subsection (b) of such section 211 of such 
     Act. If the safe harbor provided by this section does not 
     apply, the existence of a claim of defective product shall be 
     determined under otherwise applicable law. Nothing in this 
     subsection shall be construed to affect the liability of any 
     person for environmental remediation costs, drinking water 
     contamination, negligence for spills or other reasonably 
     foreseeable events, public or private nuisance, trespass, 
     breach of warranty, breach of contract, or any other 
     liability other than liability based upon a claim of 
     defective product.
       (b) Effective Date.--This section shall be effective as of 
     September 5, 2003, and shall apply with respect to all claims 
     filed on or after that date.

     SEC. 1503. FINDINGS AND MTBE TRANSITION ASSISTANCE.

       (a) 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;
       (3) at the time of the adoption of the fuel oxygen 
     standard, Congress was aware that significant use of MTBE 
     would result from the adoption of that standard, and that the 
     use of MTBE would likely be important to the cost-effective 
     implementation of that program;
       (4) Congress was aware that gasoline and its component 
     additives can and do leak from storage tanks;
       (5) 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;
       (6) having previously required oxygenates like MTBE for air 
     quality purposes, Congress has--
       (A) reconsidered the relative value of MTBE in gasoline;
       (B) decided to establish a date certain for action by the 
     Environmental Protection Agency to prohibit the use of MTBE 
     in gasoline; and
       (C) decided to provide for the elimination of the oxygenate 
     requirement for reformulated gasoline and to provide for a 
     renewable fuels content requirement for motor fuel; and
       (7) it is appropriate for Congress to provide some limited 
     transition assistance--
       (A) to merchant producers of MTBE who produced MTBE in 
     response to a market created by the oxygenate requirement 
     contained in the Clean Air Act; and
       (B) for the purpose of mitigating any fuel supply problems 
     that may result from the elimination of the oxygenate 
     requirement for reformulated gasoline and from the decision 
     to establish a date certain for action by the Environmental 
     Protection Agency to prohibit the use of MTBE in gasoline.
       (b) Purposes.--The purpose of this section is to provide 
     assistance to merchant producers of MTBE in making the 
     transition from producing MTBE to producing other fuel 
     additives.
       (c) MTBE Merchant Producer Conversion Assistance.--Section 
     211(c) of the Clean Air Act (42 U.S.C. 7545(c)) is amended by 
     adding at the end the following:
       ``(5) MTBE merchant producer conversion assistance.--
       ``(A) In general.--
       ``(i) Grants.--The Secretary of Energy, in consultation 
     with the Administrator, may make grants to merchant producers 
     of methyl tertiary butyl ether (hereinafter in this 
     subsection referred to as `MTBE') in the United States to 
     assist the producers in the conversion of eligible production 
     facilities described in subparagraph (C) to the production of 
     iso-octane, iso-octene, alkylates, or renewable fuels.
       ``(ii) Determination.--The Administrator, in consultation 
     with the Secretary of Energy, may determine that transition 
     assistance for the production of iso-octane, iso-octene, 
     alkylates, or renewable fuels is inconsistent with the 
     provisions of subparagraph (B) and, on that basis, may deny 
     applications for grants authorized by this paragraph.
       ``(B) Further grants.--The Secretary of Energy, in 
     consultation with the Administrator, may also further make 
     grants to merchant producers of MTBE in the United States to 
     assist the producers in the conversion of eligible production 
     facilities described in subparagraph (C) to the production of 
     such other fuel additives (unless the Administrator 
     determines that such fuel additives may reasonably be 
     anticipated to endanger public health or the environment) 
     that, consistent with this subsection--
       ``(i) have been registered and have been tested or are 
     being tested in accordance with the requirements of this 
     section; and
       ``(ii) will contribute to replacing gasoline volumes lost 
     as a result of amendments made to subsection (k) of this 
     section by section 1504(a) and 1506 of the Energy Policy Act 
     of 2005.
       ``(C) Eligible production facilities.--A production 
     facility shall be eligible to receive a grant under this 
     paragraph if the production facility--
       ``(i) is located in the United States; and
       ``(ii) produced MTBE for consumption before April 1, 2003 
     and ceased production at any time after the date of enactment 
     of this paragraph.
       ``(D) Authorization of appropriations.--There are 
     authorized to be appropriated to carry out this paragraph 
     $250,000,000 for each of fiscal years 2005 through 2012, to 
     remain available until expended.''.

     SEC. 1504. USE OF MTBE.

       (a) In General.--Subject to subsections (e) and (f), not 
     later than December 31, 2014, the use of methyl tertiary 
     butyl ether (hereinafter in this section referred to as 
     ``MTBE'') in motor vehicle fuel in any State other than a 
     State described in subsection (c) is prohibited.
       (b) Regulations.--The Administrator of the Environmental 
     Protection Agency (hereafter referred to in this section as 
     the ``Administrator'') shall promulgate regulations to effect 
     the prohibition in subsection (a).
       (c) States That Authorize Use.--A State described in this 
     subsection is a State in which the Governor of the State 
     submits a notification to the Administrator authorizing the 
     use of MTBE in motor vehicle fuel sold or used in the State.
       (d) Publication of Notice.--The Administrator shall publish 
     in the Federal Register each notice submitted by a State 
     under subsection (c).
       (e) Trace Quantities.--In carrying out subsection (a), the 
     Administrator may allow trace quantities of MTBE, not to 
     exceed 0.5 percent by volume, to be present in motor vehicle 
     fuel in cases that the Administrator determines to be 
     appropriate.
       (f) Limitation.--The Administrator, under authority of 
     subsection (a), shall not prohibit or control the production 
     of MTBE for export from the United States or for any other 
     use other than for use in motor vehicle fuel.
       (g) Effect on State Law.--The amendments made by this title 
     have no effect regarding any available authority of States to 
     limit the use of methyl tertiary butyl ether in motor vehicle 
     fuel.

     SEC. 1505. NATIONAL ACADEMY OF SCIENCES REVIEW AND 
                   PRESIDENTIAL DETERMINATION.

       (a) NAS Review.--Not later than May 31, 2013, the Secretary 
     shall enter into an arrangement with the National Academy of 
     Sciences to review the use of methyl tertiary butyl ether 
     (hereafter referred to in this section as ``MTBE'') in fuel 
     and fuel additives. The review shall only use the best 
     available scientific information and data collected by 
     accepted methods or the best available means. The review 
     shall examine the use of MTBE in fuel and fuel additives, 
     significant beneficial and detrimental effects of this use

[[Page 7212]]

     on environmental quality or public health or welfare 
     including the costs and benefits of such effects, likely 
     effects of controls or prohibitions on MTBE regarding fuel 
     availability and price, and other appropriate and reasonable 
     actions that are available to protect the environment or 
     public health or welfare from any detrimental effects of the 
     use of MTBE in fuel or fuel additives. The review shall be 
     peer-reviewed prior to publication and all supporting data 
     and analytical models shall be available to the public. The 
     review shall be completed no later than May 31, 2014.
       (b) Presidential Determination.--No later than June 30, 
     2014, the President may make a determination that 
     restrictions on the use of MTBE to be implemented pursuant to 
     section 1504 shall not take place and that the legal 
     authority contained in section 1504 to prohibit the use of 
     MTBE in motor vehicle fuel shall become null and void.

     SEC. 1506. 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 as follows:
       (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).
       (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).
       (II) by redesignating clause (iii) as clause (ii).

       (2) Effective date.--The amendments made by paragraph (1) 
     take effect 270 days after the date of enactment of this Act, 
     except that such amendments shall take effect upon such date 
     of enactment in any State that has received a waiver under 
     section 209(b) of the Clean Air 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 as follows:
       (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,''.
       (2) By adding at the end the following:
       ``(B) Maintenance of toxic air pollutant emissions 
     reductions from reformulated gasoline.--
       ``(i) Definitions.--In this subparagraph the term `PADD' 
     means a Petroleum Administration for Defense District.
       ``(ii) Regulations regarding emissions of toxic air 
     pollutants.--Not later than 270 days after the date of 
     enactment of this subparagraph the Administrator shall 
     establish, for each refinery or importer, standards for toxic 
     air pollutants from use of the reformulated gasoline produced 
     or distributed by the refinery or importer that maintain the 
     reduction of the average annual aggregate emissions of toxic 
     air pollutants for reformulated gasoline produced or 
     distributed by the refinery or importer during calendar years 
     1999 and 2000, determined on the basis of data collected by 
     the Administrator with respect to the refinery or importer.
       ``(iii) Standards applicable to specific refineries or 
     importers.--

       ``(I) Applicability of standards.--For any calendar year, 
     the standards applicable to a refinery or importer under 
     clause (ii) shall apply to the quantity of gasoline produced 
     or distributed by the refinery 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 refinery or importer during 
     calendar years 1999 and 2000.
       ``(II) Applicability of other standards.--For any calendar 
     year, the quantity of gasoline produced or distributed by a 
     refinery or importer that is in excess of the quantity 
     subject to subclause (I) shall be subject to standards for 
     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 1999 and 2000; 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 1999 and 2000, 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 
     refinery or importer shall meet the standards applicable 
     under clause (ii) not later than April 1 of the year 
     following the report in subclause (II) and for subsequent 
     years.
       ``(vi) Regulations to control hazardous air pollutants from 
     motor vehicles and motor vehicle fuels.--Not later than July 
     1, 2005, 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).''.
       (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.--Nothing in this section is intended to 
     affect or prejudice either any legal claims or actions with 
     respect to regulations promulgated by the Administrator of 
     the Environmental Protection Agency (hereinafter in this 
     subsection referred to as the ``Administrator'') prior to the 
     date of enactment of this Act regarding emissions of toxic 
     air pollutants from motor vehicles or the adjustment of 
     standards applicable to a specific refinery or importer made 
     under such prior regulations and the Administrator may apply 
     such adjustments to the standards applicable to such refinery 
     or importer under clause (iii)(I) of section 211(k)(1)(B) of 
     the Clean Air Act, except that--
       (1) the Administrator shall revise such adjustments to be 
     based only on calendar years 1999-2000; and
       (2) for adjustments based on toxic air pollutant emissions 
     from reformulated gasoline significantly below the national 
     annual average emissions of toxic air pollutants from all 
     reformulated gasoline, the Administrator may revise such 
     adjustments to take account of the scope of Federal or State 
     prohibitions on the use of methyl tertiary butyl ether 
     imposed after the date of the enactment of this paragraph, 
     except that any such adjustment shall require such refiner or 
     importer, to the greatest extent practicable, to maintain the 
     reduction achieved during calendar years 1999-2000 in the 
     average annual aggregate emissions of toxic air pollutants 
     from reformulated gasoline produced or distributed by the 
     refinery or importer; Provided, that 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 1999-2000.

     SEC. 1507. ANALYSES OF MOTOR VEHICLE FUEL CHANGES.

       Section 211 of the Clean Air Act (42 U.S.C. 7545) is 
     amended by inserting after subsection (o) the following:
       ``(p) 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 subsection, 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 subtitle A of title 
     XV of 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.
       ``(2) Emissions model.--For the purposes of this 
     subsection, as soon as the necessary data are available, the 
     Administrator shall develop and finalize an emissions model 
     that reasonably reflects the effects of gasoline 
     characteristics or components on emissions

[[Page 7213]]

     from vehicles in the motor vehicle fleet during calendar year 
     2005.''.

     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 is 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. REDUCING THE PROLIFERATION OF STATE FUEL CONTROLS.

       (a) EPA Approval of State Plans With Fuel Controls.--
     Section 211(c)(4)(C) of the Clean Air Act (42 U.S.C. 
     7545(c)(4)(C)) is amended by adding at the end the following: 
     ``The Administrator shall not approve a control or 
     prohibition respecting the use of a fuel or fuel additive 
     under this subparagraph unless the Administrator, after 
     consultation with the Secretary of Energy, publishes in the 
     Federal Register a finding that, in the Administrator's 
     judgment, such control or prohibition will not cause fuel 
     supply or distribution interruptions or have a significant 
     adverse impact on fuel producibility in the affected area or 
     contiguous areas.''.
       (b) Study.--The Administrator of the Environmental 
     Protection Agency (hereinafter in this subsection referred to 
     as the ``Administrator''), in cooperation with the Secretary 
     of Energy, shall undertake a study of the projected effects 
     on air quality, the proliferation of fuel blends, fuel 
     availability, and fuel costs of providing a preference for 
     each of the following:
       (A) Reformulated gasoline referred to in subsection (k) of 
     section 211 of the Clean Air Act.
       (B) A low RVP gasoline blend that has been certified by the 
     Administrator as having a Reid Vapor Pressure of 7.0 pounds 
     per square inch (psi).
       (C) A low RVP gasoline blend that has been certified by the 
     Administrator as having a Reid Vapor Pressure of 7.8 pounds 
     per square inch (psi).

     In carrying out such study, the Administrator shall obtain 
     comments from affected parties. The Administrator shall 
     submit the results of such study to the Congress not later 
     than 18 months after the date of enactment of this Act, 
     together with any recommended legislative changes.

     SEC. 1510. FUEL SYSTEM REQUIREMENTS HARMONIZATION STUDY.

       (a) Study.--
       (1) In general.--The Administrator of the Environmental 
     Protection Agency (hereinafter in this section referred to as 
     the ``Administrator'') and the Secretary of Energy 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 consumers in various States and 
     localities;
       (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;
       (C) the effect of Federal, State, and local motor vehicle 
     fuel regulations, including multiple motor vehicle fuel 
     requirements, on--
       (i) domestic refineries;
       (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, refineries, and fuel handling 
     facilities;
       (E) the feasibility of developing national or regional 
     motor vehicle fuel slates for the 48 contiguous States that, 
     while improving air quality at the national, regional and 
     local levels consistent with the attainment of national 
     ambient air quality standards, 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 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, the reformulated gasoline program, 
     the renewable content requirements established by this 
     subtitle, State programs regarding gasoline volatility, and 
     any other requirements imposed by States or localities 
     affecting the composition of motor fuel.
       (b) Report.--
       (1) In general.--Not later than December 31, 2007, the 
     Administrator and the Secretary of Energy shall submit to 
     Congress a report on the results of the study conducted under 
     subsection (a).
       (2) Recommendations.--
       (A) In general.--The report under this subsection 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 under this 
     subsection, the Administrator and the Secretary of Energy 
     shall consult with--
       (A) the Governors of the States;
       (B) automobile manufacturers;
       (C) motor vehicle fuel producers and distributors; and
       (D) the public.

     SEC. 1511. 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 of Energy 
     (hereinafter in this section referred to as 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);
       (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

[[Page 7214]]

     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. 1512. CELLULOSIC BIOMASS AND WASTE-DERIVED ETHANOL 
                   CONVERSION ASSISTANCE.

       Section 211 of the Clean Air Act (42 U.S.C. 7545) is 
     amended by adding at the end the following:
       ``(r) Cellulosic Biomass and Waste-Derived Ethanol 
     Conversion Assistance.--
       ``(1) In general.--The Secretary of Energy may provide 
     grants to merchant producers of cellulosic biomass ethanol 
     and waste-derived ethanol in the United States to assist the 
     producers in building eligible production facilities 
     described in paragraph (2) for the production of 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 or waste-derived feedstocks 
     derived from agricultural residues, wood residues, municipal 
     solid waste, or agricultural byproducts as that term is used 
     in section 919 of the Energy Policy Act of 2005.
       ``(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 2005.
       ``(B) $250,000,000 for fiscal year 2006.
       ``(C) $400,000,000 for fiscal year 2007.''.

     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.''.

            Subtitle B--Underground Storage Tank Compliance

     SEC. 1521. SHORT TITLE.

       This subtitle may be cited as the ``Underground Storage 
     Tank Compliance Act of 2005''.

     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).
       ``(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--

[[Page 7215]]

       ``(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.
       ``(iii) 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 CFR 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 CFR 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 of 
     2005, 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 of 2005;
       ``(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).
       (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:

[[Page 7216]]

       ``(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 fuel delivery 
     or deposit.
       ``(2) Guidance.--Within 1 year after the date of enactment 
     of this section, the Administrator and States that receive 
     funding under this subtitle shall, in consultation with the 
     underground storage tank owner and product delivery 
     industries, for territory for which they are the primary 
     implementing agencies, 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 or 
     deposit;
       ``(B) the mechanisms for identifying which facilities are 
     ineligible for delivery or deposit to the underground storage 
     tank owning and fuel delivery industries;
       ``(C) the process for reclassifying ineligible facilities 
     as eligible for delivery or deposit; and
       ``(D) a delineation of, or a process for determining, the 
     specified geographic areas subject to paragraph (4).
       ``(3) Delivery prohibition notice.--
       ``(A) Roster.--The Administrator and each State 
     implementing agency that receives funding under this subtitle 
     shall establish within 24 months after the date of enactment 
     of this section a Delivery Prohibition Roster listing 
     underground storage tanks under the Administrator's or the 
     State's jurisdiction that are determined to be ineligible for 
     delivery or deposit pursuant to paragraph (2).
       ``(B) Notification.--The Administrator and each State, as 
     appropriate, shall make readily known, to underground storage 
     tank owners and operators and to product delivery industries, 
     the underground storage tanks listed on a Delivery 
     Prohibition Roster by:
       ``(i) posting such Rosters, including the physical location 
     and street address of each listed underground storage tank, 
     on official web sites and, if the Administrator or the State 
     so chooses, other electronic means;
       ``(ii) updating these Rosters periodically; and
       ``(iii) installing a tamper-proof tag, seal, or other 
     device blocking the fill pipes of such underground storage 
     tanks to prevent the delivery of product into such 
     underground storage tanks.
       ``(C) Roster updates.--The Administrator and the State 
     shall update the Delivery Prohibition Rosters as appropriate, 
     but not less than once a month on the first day of the month.
       ``(D) Tampering with device.--
       ``(i) Prohibition.--It shall be unlawful for any person, 
     other than an authorized representative of the Administrator 
     or a State, as appropriate, to remove, tamper with, destroy, 
     or damage a device installed by the Administrator or a State, 
     as appropriate, under subparagraph (B)(iii) of this 
     subsection.
       ``(ii) Civil penalties.--Any person violating clause (i) of 
     this subparagraph shall be subject to a civil penalty not to 
     exceed $10,000 for each violation.
       ``(4) Limitation.--
       ``(A) Rural and remote areas.--Subject to subparagraph (B), 
     the Administrator or a State shall not include an underground 
     storage tank on a Delivery Prohibition Roster under paragraph 
     (3) if an urgent threat to public health, as determined by 
     the Administrator, does not exist and if such a delivery 
     prohibition would jeopardize the availability of, or access 
     to, fuel in any rural and remote areas.
       ``(B) Applicability of limitation.--The limitation under 
     subparagraph (A) shall apply only during the 180-day period 
     following the date of a determination by the Administrator or 
     the appropriate State that exercising the authority of 
     paragraph (3) is limited by subparagraph (A).
       ``(b) Effect on State Authority.--Nothing in this section 
     shall affect the authority of a State to prohibit the 
     delivery 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 underground storage 
     tank into which a regulated substance is delivered is not 
     listed on the Administrator's or the appropriate State's 
     Prohibited Delivery Roster 7 calendar days prior to the 
     delivery being made.''.
       (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

[[Page 7217]]

     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 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 of 
     2005, 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

[[Page 7218]]

     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.
       ``(G) The Administrator may issue regulations or guidelines 
     implementing the requirements of this subsection.
       ``(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;
       ``(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 manufacturers 
     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.''.
       (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 9004(f) and 9005(c) 
     $100,000,000 for each of fiscal years 2005 through 2009; and
       ``(D) to carry out sections 9011 and 9012 $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;

[[Page 7219]]

       ``(III) the waiver permits a transitional period, the exact 
     duration of which shall be determined by the Administrator, 
     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.
       ``(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 of Energy 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, preserves air quality standards, and 
     reduces motor fuel price volatility that results 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) 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. The Administrator shall use sound and objective 
     science practices, shall consider the best available science, 
     and shall consider and include a description of the weight of 
     the scientific evidence.
       (4) 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.
       (5) 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 House of Representatives and the 
     Committee on Environment and Public Works of the Senate.
       (6) 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 ``Secretary'' means the Secretary of Energy.
       (3) 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.
       (4) 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--STUDIES

     SEC. 1601. 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 of Energy 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 of Energy shall 
     submit a report to Congress on the results of the study, 
     including findings and any recommendations for preventing 
     future supply shortages.

     SEC. 1605. STUDY OF ENERGY EFFICIENCY STANDARDS.

       The Secretary of Energy 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. 1606. 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

[[Page 7220]]

     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) Secretary.--The term ``Secretary'' means the Secretary 
     of Energy.
       (2) Commission.--The term ``Commission'' means the Federal 
     Communications Commission.
       (3) NTIA.--The term ``NTIA'' means the National 
     Telecommunications and Information Administration of the 
     Department of Commerce.
       (4) 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.
       (5) Federal employee.--The term ``Federal employee'' has 
     the meaning provided the term ``employee'' by section 2105 of 
     title 5, United States Code.

     SEC. 1607. 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. 1608. OIL BYPASS FILTRATION TECHNOLOGY.

       The Secretary of Energy 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. 1609. TOTAL INTEGRATED THERMAL SYSTEMS.

       The Secretary of Energy 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. 1610. UNIVERSITY COLLABORATION.

       Not later than 2 years after the date of enactment of this 
     Act, the Secretary of Energy shall transmit to Congress a 
     report that examines the feasibility of promoting 
     collaborations between large institutions of higher education 
     and small institutions of higher education through grants, 
     contracts, and cooperative agreements made by the Secretary 
     for energy projects. The Secretary shall also consider 
     providing incentives for the inclusion of small institutions 
     of higher education, including minority-serving institutions, 
     in energy research grants, contracts, and cooperative 
     agreements.

     SEC. 1611. RELIABILITY AND CONSUMER PROTECTION ASSESSMENT.

       Not later than 5 years after the date of enactment of this 
     Act, and each 5 years thereafter, the Federal Energy 
     Regulatory Commission shall assess the effects of the 
     exemption of electric cooperatives and government-owned 
     utilities from Commission regulation under section 201(f) of 
     the Federal Power Act. The assessment shall include any 
     effects on--
       (1) reliability of interstate electric transmission 
     networks;
       (2) benefit to consumers, and efficiency, of competitive 
     wholesale electricity markets;
       (3) just and reasonable rates for electricity consumers; 
     and
       (4) the ability of the Commission to protect electricity 
     consumers.

     If the Commission finds that the 201(f) exemption results in 
     adverse effects on consumers or electric reliability, the 
     Commission shall make appropriate recommendations to Congress 
     pursuant to section 311 of the Federal Power Act.

     SEC. 1612. REPORT ON ENERGY INTEGRATION WITH LATIN AMERICA.

       The Secretary of Energy 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. 1613. LOW-VOLUME GAS RESERVOIR STUDY.

       (a) Study.--The Secretary of Energy 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 of Energy 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.

                      TITLE XVII--RENEWABLE ENERGY

     SEC. 1701. GRANTS TO IMPROVE THE COMMERCIAL VALUE OF FOREST 
                   BIOMASS FOR ELECTRIC ENERGY, USEFUL HEAT, 
                   TRANSPORTATION FUELS, PETROLEUM-BASED PRODUCT 
                   SUBSTITUTES, AND OTHER COMMERCIAL PURPOSES.

       (a) Findings.--Congress finds the following:
       (1) Thousands of communities in the United States, many 
     located near Federal lands, are at risk to wildfire. 
     Approximately 190,000,000 acres of land managed by the 
     Secretary of Agriculture and the Secretary of the Interior 
     are at risk of catastrophic fire in the near future. The 
     accumulation of heavy forest fuel loads continues to increase 
     as a result of disease, insect infestations, and drought, 
     further raising the risk of fire each year.
       (2) In addition, more than 70,000,000 acres across all land 
     ownerships are at risk to higher than normal mortality over 
     the next 15 years from insect infestation and disease. High 
     levels of tree mortality from insects and disease result in 
     increased fire risk, loss of old growth, degraded watershed 
     conditions, and changes in species diversity and 
     productivity, as well as diminished fish and wildlife habitat 
     and decreased timber values.

[[Page 7221]]

       (3) Preventive treatments such as removing fuel loading, 
     ladder fuels, and hazard trees, planting proper species mix 
     and restoring and protecting early successional habitat, and 
     other specific restoration treatments designed to reduce the 
     susceptibility of forest land, woodland, and rangeland to 
     insect outbreaks, disease, and catastrophic fire present the 
     greatest opportunity for long-term forest health by creating 
     a mosaic of species-mix and age distribution. Such prevention 
     treatments are widely acknowledged to be more successful and 
     cost effective than suppression treatments in the case of 
     insects, disease, and fire.
       (4) The byproducts of preventive treatment (wood, brush, 
     thinnings, chips, slash, and other hazardous fuels) removed 
     from forest lands, woodlands and rangelands represent an 
     abundant supply of biomass for biomass-to-energy facilities 
     and raw material for business. There are currently few 
     markets for the extraordinary volumes of byproducts being 
     generated as a result of the necessary large-scale preventive 
     treatment activities.
       (5) The United States should--
       (A) promote economic and entrepreneurial opportunities in 
     using byproducts removed through preventive treatment 
     activities related to hazardous fuels reduction, disease, and 
     insect infestation; and
       (B) develop and expand markets for traditionally underused 
     wood and biomass as an outlet for byproducts of preventive 
     treatment activities.
       (b) Definitions.--In this section:
       (1) Biomass.--The term ``biomass'' means trees and woody 
     plants, including limbs, tops, needles, and other woody 
     parts, and byproducts of preventive treatment, such as wood, 
     brush, thinnings, chips, and slash, that are removed--
       (A) to reduce hazardous fuels; or
       (B) to reduce the risk of or to contain disease or insect 
     infestation.
       (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) 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, micro-business, or a corporation that 
     is incorporated in the United States; and
       (E) a nonprofit organization.
       (4) Preferred community.--The term ``preferred community'' 
     means--
       (A) 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 
     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
       (B) 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 
     land, the condition of which is at significant risk of 
     catastrophic wildfire, disease, or insect infestation or 
     which suffers from disease or insect infestation.
       (5) Secretary concerned.--The term ``Secretary concerned'' 
     means the Secretary of Agriculture or the Secretary of the 
     Interior.
       (c) Biomass Commercial Use Grant Program.--
       (1) In general.--The Secretary concerned may make grants to 
     any person that owns or operates a facility that uses biomass 
     as a raw material to produce electric energy, sensible heat, 
     transportation fuels, or substitutes for petroleum-based 
     products 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.
       (d) 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 the anticipated public benefits of the 
     project, including the potential to develop thermal or 
     electric energy resources or affordable energy, opportunities 
     for the creation or expansion of small businesses and micro-
     businesses, and the potential for new job creation.
       (3) Grant amount.--A grant under this subsection may not 
     exceed $500,000.
       (e) 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.
       (f) 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 the 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. 1702. ENVIRONMENTAL REVIEW FOR RENEWABLE ENERGY 
                   PROJECTS.

       (a) Compliance With NEPA for Renewable Energy Projects.--
     Notwithstanding any other law, in preparing an environmental 
     assessment or environmental impact statement required under 
     section 102 of the National Environmental Policy Act of 1969 
     (42 U.S.C. 4332) with respect to any action authorizing a 
     renewable energy project under the jurisdiction of a Federal 
     agency--
       (1) no Federal agency is required to identify alternative 
     project locations or actions other than the proposed action 
     and the no action alternative; and
       (2) no Federal agency is required to analyze the 
     environmental effects of alternative locations or actions 
     other than those submitted by the project proponent.
       (b) Consideration of Alternatives.--In any environmental 
     assessment or environmental impact statement referred to in 
     subsection (a), the Federal agency shall only identify and 
     analyze the environmental effects and potential mitigation 
     measures of--
       (1) the proposed action; and
       (2) the no action alternative.
       (c) Public Comment.--In preparing an environmental 
     assessment or environmental impact statement referred to in 
     subsection (a), the Federal agency shall only consider public 
     comments that specifically address the preferred action and 
     that are filed within 20 days after publication of a draft 
     environmental assessment or draft environmental impact 
     statement. Notwithstanding any other law, compliance with 
     this subsection is deemed to satisfy section 102(2) of the 
     National Environmental Policy Act of 1969 (42 U.S.C. 4332(2)) 
     and the applicable regulations and administrative guidelines 
     with respect to proposed renewable energy projects.
       (d) Renewable Energy Project Defined.--For purposes of this 
     section, the term ``renewable energy project''--
       (1) means any proposal to utilize an energy source other 
     than nuclear power, coal, oil, or natural gas; and
       (2) includes the use of wind, solar, geothermal, biomass, 
     or tidal forces to generate energy.

     SEC. 1703. 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.

                     TITLE XVIII--GEOTHERMAL ENERGY

     SEC. 1801. SHORT TITLE.

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

     SEC. 1802. 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 lands available for leasing at any time from qualified 
     companies and individuals under this Act.
       ``(b) Competitive Lease Sale Required.--The Secretary shall 
     hold a competitive lease sale at least once every 2 years for 
     lands in a State which has nominations pending under 
     subsection (a) if such lands are otherwise available for 
     leasing. Lands that are subject to a mining claim for which a 
     plan of operations has been approved by the relevant Federal 
     land management agency are not available for competitive 
     leasing.
       ``(c) Noncompetitive Leasing.--
       ``(1) Requirement.--The Secretary shall make available for 
     a period of 2 years for noncompetitive leasing any tract for 
     which a

[[Page 7222]]

     competitive lease sale is held, but for which the Secretary 
     does not receive any bids in a competitive lease sale.
       ``(2) States without nominations.--In any State for which 
     there are no nominations received under subsection (a) and 
     having a total acreage under lease or the subject of an 
     application for lease of less than 10,000 acres, the 
     Secretary may designate lands available for 2 years for 
     noncompetitive leasing.
       ``(d) 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.
       ``(e) Area Subject to Lease for Geothermal Resources.--A 
     geothermal lease for the use of geothermal resources shall 
     embrace not more than the amount of acreage determined by the 
     Secretary to be appropriate.''.

     SEC. 1803. 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 paragraph (c) by redesignating subparagraphs (1) and 
     (2) as subparagraphs (A) and (B);
       (2) by redesignating paragraphs (a) through (d) in order as 
     paragraphs (1) through (4);
       (3) by inserting ``(a) In General.--'' after ``Sec. 5.''; 
     and
       (4) by adding at the end the following:
       ``(b) Fees for Direct Use.--
       ``(1) In general.--Notwithstanding subsection (a)(1), with 
     respect to the direct use of geothermal resources for 
     purposes other than the commercial generation of electricity, 
     the Secretary of the Interior shall establish a schedule of 
     fees and collect fees pursuant to such a schedule in lieu of 
     royalties. Notwithstanding section 102(a)(9) of the Federal 
     Land Policy and Management Act of 1976 (43 U.S.C. 
     1701(a)(9)), the schedule of fees shall be based upon 
     comparable non-Federal fees charged for direct use of 
     geothermal resources within the State concerned. For direct 
     use by a State or local government for public purposes, the 
     fee charged shall be nominal. Leases in existence on the date 
     of enactment of this subsection shall be modified in order to 
     reflect the provisions of this subsection.
       ``(2) 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 encourage development of this underutilized energy 
     resource on the Federal estate; and
       ``(C) to contribute to sustainable economic development 
     opportunities for host communities.''.
       (b) Leasing for Direct Use.--Section 4 of the Geothermal 
     Steam Act of 1970 (30 U.S.C. 1003) is further amended by 
     adding at the end the following:
       ``(f) Leasing for Direct Use of Geothermal Resources.--
     Lands leased under this Act exclusively for direct use of 
     geothermal resources shall be leased to any qualified 
     applicant who first applies for such a lease under 
     regulations issued by the Secretary, if--
       ``(1) the Secretary publishes a notice of the lands 
     proposed for leasing 60 days before the date of the issuance 
     of the lease; and
       ``(2) the Secretary does not receive in the 60-day period 
     beginning on the date of such publication any nomination to 
     include the lands concerned in the next competitive lease 
     sale.
       ``(g) Area Subject to Lease for Direct Use.--A geothermal 
     lease for the direct use of geothermal resources shall 
     embrace not more than the amount of acreage determined by the 
     Secretary to be reasonably necessary for such proposed 
     utilization.''.
       (c) Existing Leases With a Direct Use Facility.--
       (1) Application to convert.--Any lessee under a lease under 
     the Geothermal Steam Act of 1970 that was issued before the 
     date of enactment of this Act may apply to the Secretary of 
     the Interior, by not later than 18 months after the date of 
     enactment of this Act, to convert such lease to a lease for 
     direct utilization of geothermal resources in accordance with 
     the amendments made by this section.
       (2) Conversion.--The Secretary shall approve such an 
     application and convert such a lease to a lease in accordance 
     with the amendments by not later than 180 days after receipt 
     of such application, unless the Secretary determines that the 
     applicant is not a qualified applicant with respect to the 
     lease.
       (3) 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 to the United 
     States on or after July 16, 2003.

     SEC. 1804. 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;
       ``(3) to achieve the same long-term level of royalty 
     revenues to States and counties as the regulation in effect 
     on the date of enactment of this subsection; and
       ``(4) to reflect any change in profitability of operations 
     for which royalties will be paid due to the requirements 
     imposed by Federal agencies, including delays.
       ``(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), 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 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 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 before the date of enactment of 
     this Act may modify the terms of the lease relating to 
     payment of royalties to comply with the amendment made by 
     subsection (a), by applying to the Secretary of the Interior 
     by not later than 18 months after the date of enactment of 
     this Act.

[[Page 7223]]

       (2) Application of modification.--Such modification shall 
     apply to any use of geothermal resources to which the 
     amendment applies that occurs after the date of that 
     application.
       (3) Consultation.--The Secretary--
       (A) shall consult with the State and local governments 
     affected by any proposed changes in lease royalty terms under 
     this subsection; and
       (B) may establish royalty based on a gross proceeds 
     percentage within the range specified in the amendment made 
     by subsection (a)(1) and with the concurrence of the lessee 
     and the State.

     SEC. 1805. EXPEDITING ADMINISTRATIVE ACTION FOR GEOTHERMAL 
                   LEASING.

       (a) Treatment of Geothermal Leasing With Respect to Federal 
     Land Management Plan Requirements.--Section 15 of the 
     Geothermal Steam Act of 1970 (30 U.S.C. 1014) is amended by 
     adding at the end the following:
       ``(d) Treatment of Geothermal Leasing Under Federal Land 
     Management Plans.--Geothermal leasing and development of 
     Federal lands in accordance with this Act is deemed to be 
     consistent with the management of National Forest System 
     lands under section 6 of the Forest and Rangeland Renewable 
     Resources Planning Act of 1974 (16 U.S.C. 1604) and public 
     lands under section 202 of the Federal Land Policy and 
     Management Act of 1976 (43 U.S.C. 1712). Land and resource 
     management plans and land use plans in effect under such 
     sections on the date of the enactment of this subsection are 
     deemed to be adequate to proceed with the issuance of leases 
     under this Act.''.
       (b) Lease Applications Pending on January 1, 2005.--
       (1) Priority.--It shall be a priority for the Secretary of 
     the Interior, and for the Secretary of Agriculture with 
     respect to National Forest Systems lands, to ensure timely 
     completion of administrative actions necessary to process 
     applications for geothermal leasing pending on January 1, 
     2005.
       (2) Applicable law.--An application referred to in 
     paragraph (1), and any lease issued pursuant to such an 
     application--
       (A) except as provided in subparagraph (B), shall be 
     subject to this section as in effect on January 1, 2005; or
       (B) at the election of the applicant, shall be subject to 
     this section as in effect on the effective date of this 
     paragraph.

     SEC. 1806. 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--
       (A) 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;
       (B) making diligent efforts to directly contact the lease 
     applicants (including their heirs, assigns, or estates); and
       (C) ensuring that no lease application is rejected except 
     in compliance with all requirements regarding diligent direct 
     contact.
       (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. 1807. REVIEW AND REPORT TO CONGRESS.

       The Secretary of the Interior shall promptly review and 
     report to Congress not later than 3 years after the date of 
     enactment of this Act regarding the status of all withdrawals 
     from leasing under the Geothermal Steam Act of 1970 (30 
     U.S.C. 1001 et seq.) of Federal lands, specifying for each 
     such area whether the basis for such withdrawal still 
     applies.

     SEC. 1808. REIMBURSEMENT FOR COSTS OF NEPA ANALYSES, 
                   DOCUMENTATION, AND STUDIES.

       (a) In General.--The Geothermal Steam Act of 1970 (30 
     U.S.C. 1001 et seq.) is amended by adding at the end the 
     following:

     ``SEC. 30. REIMBURSEMENT FOR COSTS OF CERTAIN ANALYSES, 
                   DOCUMENTATION, AND STUDIES.

       ``(a) In General.--The Secretary of the Interior shall 
     issue regulations under which the Secretary shall reimburse a 
     person that is a lessee, operator, operating rights owner, or 
     applicant for any lease under this Act for reasonable amounts 
     paid by the person for preparation for the Secretary by a 
     contractor or other person selected by the Secretary of any 
     project-level analysis, documentation, or related study 
     required pursuant to the National Environmental Policy Act of 
     1969 (42 U.S.C. 4321 et seq.) with respect to the lease.
       ``(b) Conditions.--The Secretary may provide reimbursement 
     under subsection (a) only if--
       ``(1) adequate funding to enable the Secretary to timely 
     prepare the analysis, documentation, or related study is not 
     appropriated;
       ``(2) the person paid the costs voluntarily;
       ``(3) the person maintains records of its costs in 
     accordance with regulations issued by the Secretary;
       ``(4) the reimbursement is in the form of a reduction in 
     the Federal share of the royalty required to be paid for the 
     lease for which the analysis, documentation, or related study 
     is conducted, and is agreed to by the Secretary and the 
     person reimbursed prior to commencing the analysis, 
     documentation, or related study; and
       ``(5) the agreement required under paragraph (4) contains 
     provisions--
       ``(A) reducing royalties owed on lease production based on 
     market prices;
       ``(B) stipulating an automatic termination of the royalty 
     reduction upon recovery of documented costs; and
       ``(C) providing a process by which the lessee may seek 
     reimbursement for circumstances in which production from the 
     specified lease is not possible.''.
       (b) Application.--The amendment made by this section shall 
     apply with respect to an analysis, documentation, or a 
     related study conducted on or after the date of enactment of 
     this Act for any lease entered into before, on, or after the 
     date of enactment of this Act.
       (c) Deadline for Regulations.--The Secretary shall issue 
     regulations implementing the amendment made by this section 
     by not later than 1 year after the date of enactment of this 
     Act.

     SEC. 1809. ASSESSMENT OF GEOTHERMAL ENERGY POTENTIAL.

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

     SEC. 1810. 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 field, or like area, is then subject 
     to any Unit Agreement (cooperative plan of development or 
     operation)), 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 such 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. A majority interest of lessees under any single 
     lease shall have the authority to commit that lease to a Unit 
     Agreement. The Secretary of the Interior may also initiate 
     the formation of a Unit Agreement, if such action is in the 
     public interest.
       ``(2) Modification of lease requirements by secretary.--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 
     such leases and make conditions with reference to such 
     leases, with the consent of the lessees, in connection with 
     the creation and operation of any such Unit Agreement as the 
     Secretary may deem necessary or proper to secure the proper 
     protection of the public interest. Leases with unlike lease 
     terms or royalty rates do not need to be modified to be in 
     the same unit.
       ``(b) Requirement of Plans Under New Leases.--The 
     Secretary--
       ``(1) may provide that geothermal leases issued under this 
     Act shall contain a provision requiring the lessee to operate 
     under such a reasonable Unit Agreement; and
       ``(2) may prescribe such an Agreement under which such 
     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

[[Page 7224]]

     Agreement authorized by this section that applies to lands 
     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 Agreement to alter or modify from time to 
     time the rate of prospecting and development and the quantity 
     and rate of production under such an Agreement.
       ``(d) Exclusion From Determination of Holding or Control.--
     Any lands that are subject to any Agreement approved or 
     prescribed by the Secretary under this section shall not be 
     considered in determining holdings or control under any 
     provision of this Act.
       ``(e) Pooling of Certain Lands.--If separate tracts of 
     lands cannot be independently developed and operated to use 
     geothermal resources pursuant to any section of this Act--
       ``(1) such lands, or a portion thereof, may be pooled with 
     other lands, 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 such pooling is determined by the 
     Secretary to be in the public interest; and
       ``(2) operation or production pursuant to such an Agreement 
     shall be treated as operation or production with respect to 
     each tract of land that is subject to the agreement.
       ``(f) Unit Agreement Review.--No more than 5 years after 
     approval of any cooperative or Unit Agreement and at least 
     every 5 years thereafter, the Secretary shall review each 
     such Agreement and, after notice and opportunity for comment, 
     eliminate from inclusion in such Agreement any lands that the 
     Secretary determines are not reasonably necessary for Unit 
     operations under the Agreement. Such elimination shall be 
     based on scientific evidence, and shall occur only if it is 
     determined by the Secretary to be for the purpose of 
     conserving and properly managing the geothermal resource. Any 
     land so eliminated shall be eligible for an extension under 
     subsection (g) of section 6 if it meets the requirements for 
     such an extension.
       ``(g) Drilling or Development Contracts.--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 thereby. All leases 
     operated under such approved drilling or development 
     contracts, and interests thereunder, 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 the 
     appropriate State agencies and shall ensure that State leases 
     included in any unitization or pooling arrangement are 
     treated equally with Federal leases.''.

     SEC. 1811. ROYALTY ON BYPRODUCTS.

       Section 5 of the Geothermal Steam Act of 1970 (30 U.S.C. 
     1004) is further amended in subsection (a) by striking 
     paragraph (2) and inserting the following:
       ``(2) a royalty on any byproduct that is a mineral named 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 such mineral under a lease under that Act;''.

     SEC. 1812. REPEAL OF AUTHORITIES OF SECRETARY TO READJUST 
                   TERMS, CONDITIONS, RENTALS, AND ROYALTIES.

       Section 8 of the Geothermal Steam Act of 1970 (30 U.S.C. 
     1007) is amended by repealing subsection (b), and by 
     redesignating subsection (c) as subsection (b).

     SEC. 1813. CREDITING OF RENTAL TOWARD ROYALTY.

       Section 5 of the Geothermal Steam Act of 1970 (30 U.S.C. 
     1004) 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. 1814. 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 fifth year of the lease--
       ``(A) the Secretary determined under subsection (c) that 
     the lessee satisfied the work commitment requirements that 
     applied to the lease for that year; or
       ``(B) the lessee paid in accordance with subsection (d) the 
     value of any work that was not completed in accordance with 
     those requirements.
       ``(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 (c) that the lessee 
     satisfied the work commitment requirements that applied to 
     the lease for that year.
       ``(b) Requirement to Satisfy Annual Work Commitment 
     Requirement.--
       ``(1) In general.--The lessee for a geothermal lease shall, 
     for each year after the fifth year of the lease, satisfy work 
     commitment requirements prescribed by the Secretary that 
     apply to the lease for that year.
       ``(2) Prescription of work commitment requirements.--The 
     Secretary shall issue regulations prescribing minimum 
     equivalent dollar value work commitment requirements for 
     geothermal leases, that--
       ``(A) require that a lessee, in each year after the fifth 
     year of the primary term of a geothermal lease, diligently 
     work to achieve commercial utilization of geothermal 
     resources under the lease;
       ``(B) describe work that qualifies to meet these 
     requirements and factors, such as force majeure events, that 
     suspend or modify the work commitment obligation;
       ``(C) carry forward and apply to work commitment 
     requirements for a year, work completed in any year in the 
     preceding 3-year period that was in excess of the work 
     required to be performed in that preceding year;
       ``(D) 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--
       ``(i) to allow achievement of production under the lease; 
     or
       ``(ii) to allow the lease to be included in a producing 
     unit; and
       ``(E) establish an annual payment that, at the option of 
     the lessee, may be exercised in lieu of meeting any work 
     requirement for a limited number of years that the Secretary 
     determines will not impair achieving diligent development of 
     the geothermal resource.
       ``(3) Geothermal lease overlying mining claim.--
       ``(A) 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.
       ``(B) Termination of exemption.--An exemption under this 
     paragraph expires upon the termination of the mining 
     operations.
       ``(4) Termination of application of requirements.--Work 
     commitment requirements prescribed under this subsection 
     shall not apply to a geothermal lease after the date on which 
     the geothermal resource is utilized under the lease in 
     commercial quantities.
       ``(c) Determination of Whether Requirements Satisfied.--The 
     Secretary shall, by not later than 90 days after the end of 
     each year for which work commitment requirements under 
     subsection (b) apply to a geothermal lease--
       ``(1) determine whether the lessee has satisfied the 
     requirements that apply for that year;
       ``(2) notify the lessee of that determination; and
       ``(3) in the case of a notification that the lessee did not 
     satisfy work commitment requirements for the year, include in 
     the notification--
       ``(A) a description of the specific work that was not 
     completed by the lessee in accordance with the requirements; 
     and
       ``(B) the amount of the dollar value of such work that was 
     not completed, reduced by the amount of expenditures made for 
     work completed in a prior year that is carried forward 
     pursuant to subsection (b)(2)(D).
       ``(d) Payment of Value of Uncompleted Work.--
       ``(1) In general.--If the Secretary notifies a lessee that 
     the lessee failed to satisfy work commitment requirements 
     under subsection (b), the lessee shall pay to the Secretary, 
     by not later than the end of the 60-day period beginning on 
     the date of the notification, the dollar value of work that 
     was not completed by the lessee, in the amount stated in the 
     notification (as reduced under subsection (c)(3)(B)).
       ``(2) Failure to pay value of uncompleted work.--If a 
     lessee fails to pay such amount to the Secretary before the 
     end

[[Page 7225]]

     of that period, the lease shall terminate upon the expiration 
     of the period.
       ``(e) Continuation During Commercial Utilization.--
       ``(1) In general.--If a geothermal resource that is subject 
     to a geothermal lease is utilized in commercial quantities 
     within the primary term of the lease under subsection (a) 
     (including any extension of the lease under subsection (a)), 
     such lease shall continue until the date on which the 
     geothermal resource is no longer utilized in commercial 
     quantities.
       ``(2) Continuation of associated leases.--If a geothermal 
     lease is for an area in which there is injected fluid or 
     steam from a nearby geothermal resource for the purpose of 
     maintaining commercial utilization of a geothermal resource, 
     such lease shall continue until such commercial utilization 
     is terminated.
       ``(f) Conversion of Geothermal Lease to Mineral Lease.--A 
     lessee under a lease for a geothermal resource that has been 
     utilized for commercial production of electricity, has been 
     determined by the Secretary to be incapable of any further 
     commercial utilization, and is producing any valuable 
     byproduct in payable quantities may, within 6 months after 
     such determination--
       ``(1) convert the lease to a mineral lease under the 
     Mineral Leasing Act (30 U.S.C. 181 et seq.) or under the 
     Mineral Leasing Act for Acquired Lands (30 U.S.C. 351 et 
     seq.), if the lands that are subject to the lease can be 
     leased under that Act for the production of such byproduct; 
     or
       ``(2) convert the lease to a mining claim under the general 
     mining laws, if the byproduct is a locatable mineral.''.

     SEC. 1815. ADVANCED ROYALTIES REQUIRED FOR SUSPENSION OF 
                   PRODUCTION.

       Section 5 of the Geothermal Steam Act of 1970 (30 U.S.C. 
     1004) is further amended by adding at the end the following:
       ``(f) Advanced Royalties Required for Suspension of 
     Production.--
       ``(1) Continuation of lease following cessation of 
     production.--If, at any time after commercial production 
     under a geothermal lease is achieved, production ceases for 
     any cause the lease shall remain in full force and effect--
       ``(A) during the 1-year period beginning on the date 
     production ceases; and
       ``(B) after such period if, and so long as, the lessee 
     commences and continues diligently and in good faith until 
     such production is resumed the steps, operations, or 
     procedures necessary to cause a resumption of such 
     production.
       ``(2) Advance royalties following suspension of 
     production.--If production of heat or energy under a 
     geothermal lease is suspended after the date of any such 
     production for which royalty is required under subsection (a) 
     and the terms of paragraph (1) are not met, the Secretary 
     shall require the lessee, until the end of such suspension, 
     to pay royalty in advance at the monthly pro rata rate of the 
     average annual rate at which such royalty was paid each year 
     in the 5-year-period preceding the date of suspension.
       ``(3) Limitation on application.--Paragraph (2) shall not 
     apply if the suspension is required or otherwise caused by 
     the Secretary, the Secretary of a military department, a 
     State or local government, or a force majeure.''.

     SEC. 1816. ANNUAL RENTAL.

       (a) Annual Rental Rate.--Section 5 of the Geothermal Steam 
     Act of 1970 (30 U.S.C. 1004) is further amended in subsection 
     (a) in paragraph (3) by striking ``$1 per acre or fraction 
     thereof for each year of the lease'' and all that follows 
     through the end of the paragraph and inserting ``$1 per acre 
     or fraction thereof for each year of the lease through the 
     tenth year in the case of a lease awarded in a noncompetitive 
     lease sale; or $2 per acre or fraction thereof for the first 
     year, $3 per acre or fraction thereof for each of the second 
     through tenth years, in the case of a lease awarded in a 
     competitive lease sale; and $5 per acre or fraction thereof 
     for each year after the 10th year thereof for all leases.''.
       (b) Termination of Lease for Failure to Pay Rental.--
     Section 5 of the Geothermal Steam Act of 1970 (30 U.S.C. 
     1004) 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 
     geothermal 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, upon the expiration of the 45-
     day period beginning on the date of the failure to pay such 
     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 geothermal 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 such amount.''.

     SEC. 1817. 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.--Subject to appropriations, the 
     Secretary may use amounts deposited under subsection (a) to 
     implement the Geothermal Steam Act of 1970 and this Act.

     SEC. 1818. REPEAL OF ACREAGE LIMITATIONS.

       Section 7 of the Geothermal Steam Act of 1970 (30 U.S.C. 
     1006) is repealed.

     SEC. 1819. TECHNICAL AMENDMENTS.

       The Geothermal Steam Act of 1970 (30 U.S.C. 1001 et seq.) 
     is further amended as follows:
       (1) By striking ``geothermal steam and associated 
     geothermal resources'' each place it appears and inserting 
     ``geothermal resources''.
       (2) Section 2(e) (30 U.S.C. 1001(e)) is amended to read as 
     follows:
       ``(e) `direct use' means utilization of geothermal 
     resources for commercial, residential, agricultural, public 
     facilities, off-grid generation of electricity, 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:

[[Page 7226]]



     ``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. 1820. INTERMOUNTAIN WEST GEOTHERMAL CONSORTIUM.

       (a) Participation Authorized.--The Secretary of Energy, 
     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 of Energy, 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.

                         TITLE XIX--HYDROPOWER

     SEC. 1901. INCREASED HYDROELECTRIC GENERATION AT EXISTING 
                   FEDERAL FACILITIES.

       (a) In General.--The Secretary of the Interior, the 
     Secretary of Energy, 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. 1902. SHIFT OF PROJECT LOADS TO OFF-PEAK PERIODS.

       (a) In General.--The Secretary of the Interior shall--
       (1) review electric power consumption by Bureau of 
     Reclamation facilities for water pumping purposes; and
       (2) make such adjustments in such pumping as possible to 
     minimize the amount of electric power consumed for such 
     pumping during periods of peak electric power consumption, 
     including by performing as much of such pumping as possible 
     during off-peak hours at night.
       (b) Consent of Affected Irrigation Customers Required.--The 
     Secretary may not under this section make any adjustment in 
     pumping at a facility without the consent of each person that 
     has contracted with the United States for delivery of water 
     from the facility for use for irrigation and that would be 
     affected by such adjustment.
       (c) Existing Obligations not Affected.--This section shall 
     not be construed to affect any existing obligation of the 
     Secretary to provide electric power, water, or other benefits 
     from Bureau of Reclamation facilities, including recreational 
     releases.

     SEC. 1903. 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.

                    TITLE XX--OIL AND GAS--RESOURCES

                   Subtitle A--Production Incentives

     SEC. 2001. DEFINITION OF SECRETARY.

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

     SEC. 2002. 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 section 36 of the Mineral Leasing Act (30 U.S.C. 192), 
     section 27 of the Outer Continental Shelf Lands Act (43 
     U.S.C. 1353), or any other Federal law governing leasing of 
     Federal land for oil and gas development.

[[Page 7227]]

       (b) Terms and Conditions.--All royalty accruing to the 
     United States shall, on the demand of the Secretary, be paid 
     in oil or gas. If the Secretary makes such a demand, the 
     following provisions apply to such 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 the lessee's royalty obligation 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) In general.--Royalty production shall be placed in 
     marketable condition by the lessee at no cost to the United 
     States.
       (B) 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.
       (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 (in this paragraph referred to 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 the sale of 
     oil taken in-kind, 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, 2005, the 
     Secretary shall submit to Congress a report that addresses--
       (A) actions taken to develop businesses 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 2005 through 2014 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 methodology or 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, but not limited to, 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 
     United States 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, and may 
     delegate management of any portion of the Federal royalty in-
     kind program to the State except as otherwise prohibited by 
     Federal law; and
       (2) 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 those 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 such 
     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 such 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 of 
     Energy 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 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 transmit a report 
     to Congress, assessing the effectiveness of granting 
     preferences specified in paragraph (1) and providing a 
     specific recommendation on the continuation of authority to 
     grant preferences.

     SEC. 2003. 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 million 
     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 thresholds or standards, the 
     Secretary shall reduce the royalty rate on--
       (1) oil production from marginal properties as prescribed 
     in subsection (c) when the spot price of West Texas 
     Intermediate crude oil at Cushing, Oklahoma, is, on average, 
     less than $15 per barrel for 90 consecutive trading days; and
       (2) gas production from marginal properties as prescribed 
     in subsection (c) when the spot price of natural gas 
     delivered at Henry Hub, Louisiana, is, on average, less than 
     $2.00 per million British thermal units 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--

[[Page 7228]]

       (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 (d)(1)(A) 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 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 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.--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) Considerations.--In promulgating 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.
       (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. 2004. 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 35,000,000,000 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) Definition of ultra deep well.--In this subsection, the 
     term ``ultra deep well'' means a well drilled with a 
     perforated interval, the top of which is at least 20,000 feet 
     true vertical depth below the datum at mean sea level.
       (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 the 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) Limitation.--The Secretary may place limitations on the 
     suspension of royalty relief granted based on market price.

     SEC. 2005. ROYALTY RELIEF FOR DEEP WATER PRODUCTION.

       (a) In General.--For all tracts 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 within 5 years after the date of enactment of this 
     Act shall use the bidding system authorized in section 
     8(a)(1)(H) of the Outer Continental Shelf Lands Act (43 
     U.S.C. 1337(a)(1)(H)), except that the suspension of 
     royalties shall be set 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
       (4) 16,000,000 barrels of oil equivalent for each lease in 
     water depths greater than 2,000 meters.
       (b) Limitation.--The Secretary may place limitations on the 
     suspension of royalty relief granted based on market price.

     SEC. 2006. 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. 2007. 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) designated 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) of this section) 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.--Notwithstanding any other provision of 
     law and pursuant to regulations issued by the Secretary, the 
     Secretary shall conduct an expeditious program of competitive 
     leasing of oil and gas in the National Petroleum Reserve in 
     Alaska (referred to in this section as the `Reserve').
       ``(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--
       ``(A) issued for an initial period of not more than 10 
     years; and
       ``(B) renewed for successive 10-year terms if--
       ``(i) oil or gas is produced from the lease in paying 
     quantities;
       ``(ii) oil or gas is capable of being produced in paying 
     quantities; or
       ``(iii) drilling or reworking operations, as approved by 
     the Secretary, are conducted on the leased land.
       ``(2) Renewal of nonproducing leases.--The Secretary shall 
     renew for an additional

[[Page 7229]]

      10-year term a lease that does not meet the requirements of 
     paragraph (1)(B) if the lessee submits to the Secretary an 
     application for renewal not later than 60 days before the 
     expiration of the primary lease and--
       ``(A) the lessee certifies, and the Secretary agrees, that 
     hydrocarbon resources were discovered on 1 or more wells 
     drilled on the leased land in such quantities that a prudent 
     operator would hold the lease for potential future 
     development;
       ``(B) the lessee--
       ``(i) pays the Secretary a renewal fee of $100 per acre of 
     leased land; and
       ``(ii) provides evidence, and the Secretary agrees that, 
     the lessee has diligently pursued exploration that warrants 
     continuation with the intent of continued exploration or 
     future development of the leased land; or
       ``(C) all or part of the lease--
       ``(i) is part of a unit agreement covering a lease 
     described in subparagraph (A) or (B); and
       ``(ii) has not been previously contracted out of the unit.
       ``(3) Applicability.--This subsection applies to a lease 
     that--
       ``(A) is entered into before, on, or after the date of 
     enactment of the Energy Policy Act of 2005; and
       ``(B) is effective on or after the date of enactment of 
     that Act.
       ``(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.
       ``(2) Participation by state of alaska.--The Secretary 
     shall ensure that the State of Alaska is provided the 
     opportunity for active participation concerning creation and 
     management of units formed or expanded under this subsection 
     that include acreage in which the State of Alaska has an 
     interest in the mineral estate.
       ``(3) Participation by regional corporations.--The 
     Secretary shall ensure that any Regional Corporation (as 
     defined in section 3 of the Alaska Native Claims Settlement 
     Act (43 U.S.C. 1602)) is provided the opportunity for active 
     participation concerning creation and management of units 
     that include acreage in which the Regional Corporation has an 
     interest in the mineral estate.
       ``(4) Production allocation methodology.--The Secretary may 
     use a production allocation methodology for each 
     participating area within a unit created for land in the 
     Reserve, State of Alaska land, or Regional Corporation land 
     shall, when appropriate, be based on the characteristics of 
     each specific oil or gas pool, field, reservoir, or like area 
     to take into account reservoir heterogeneity and a real 
     variation in reservoir producibility across diverse leasehold 
     interests.
       ``(5) Benefit of operations.--Drilling, production,'';
       (9) by striking ``When separate'' and inserting the 
     following:
       ``(6) 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), if (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 lands 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.)) the Secretary determines that the waiver, 
     suspension, or reduction is in the public interest.
       ``(B) Applicability.--This paragraph applies to a lease 
     that--
       ``(i) is entered into before, on, or after the date of 
     enactment of the Energy Policy Act of 2005; and
       ``(ii) is effective on or after the date of enactment of 
     that Act.'';
       (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 clauses (A), (B), and (C) as clauses 
     (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 ``of the Naval Petroleum Reserves 
     Production Act of 1976 (90 Stat. 304; 42 U.S.C. 6504)''; and
       (20) by adding at the end the following:
       ``(o) Waiver of Administration for Conveyed Lands.--
     Notwithstanding section 14(g) of the Alaska Native Claims 
     Settlement Act (43 U.S.C. 1613(g)) or any other provision of 
     law--
       ``(1) the Secretary of the Interior shall waive 
     administration of any oil and gas lease insofar as such lease 
     covers any land in the National Petroleum Reserve in Alaska 
     in which the subsurface estate is conveyed to the Arctic 
     Slope Regional Corporation; and
       ``(2) if any such conveyance of such subsurface estate does 
     not cover all the land embraced within any such oil and gas 
     lease--
       ``(A) the person who owns the subsurface estate in any 
     particular portion of the land covered by such lease shall be 
     entitled to all of the revenues reserved under such lease as 
     to such portion, including, without limitation, all the 
     royalty payable with respect to oil or gas produced from or 
     allocated to such particular portion of the land covered by 
     such lease; and
       ``(B) the Secretary of the Interior shall segregate such 
     lease into 2 leases, 1 of which shall cover only the 
     subsurface estate conveyed to the Arctic Slope Regional 
     Corporation, and operations, production, or other 
     circumstances (other than payment of rentals or royalties) 
     that satisfy obligations of the lessee under, or maintain, 
     either of the segregated leases shall likewise satisfy 
     obligations of the lessee under, or maintain, the other 
     segregated lease to the same extent as if such segregated 
     leases remained a part of the original unsegregated lease.''.

     SEC. 2008. 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) 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--

[[Page 7230]]

       (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.
       (g) 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, but not 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 well 
     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 115 
     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) Effect of remediation, reclamation, or closure of well 
     pursuant to an approved remediation plan.--
       (A) Definition of remediating party.--In this paragraph the 
     term ``remediating party'' means a person who remediates, 
     reclaims, or closes an abandoned, orphaned, or idled well 
     pursuant to this subsection.
       (B) General rule.--A remediating party who remediates, 
     reclaims, or closes an abandoned, orphaned, or idled well in 
     accordance with a detailed written remediation plan approved 
     by the Secretary under this subsection, shall be immune from 
     civil liability under Federal environmental laws, for--
       (i) pre-existing environmental conditions at or associated 
     with the well, unless the remediating party owns or operates, 
     in the past owned or operated, or is related to a person that 
     owns or operates or in the past owned or operated, the well 
     or the land on which the well is located; or
       (ii) any remaining releases of pollutants from the well 
     during or after completion of the remediation, reclamation, 
     or closure of the well, unless the remediating party causes 
     increased pollution as a result of activities that are not in 
     accordance with the approved remediation plan.
       (C) Limitations.--Nothing in this section shall limit in 
     any way the liability of a remediating party for injury, 
     damage, or pollution resulting from the remediating party's 
     acts or omissions that are not in accordance with the 
     approved remediation plan, are reckless or willful, 
     constitute gross negligence or wanton misconduct, or are 
     unlawful.
       (4) Regulations.--The Secretary may issue such regulations 
     as are appropriate to carry out this subsection.
       (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. 2009. 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--
       ``(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. 2010. 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 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, 
     transportation, or storage of oil, natural gas, or other 
     minerals;
       ``(B) produce or support production, transportation, or 
     transmission of energy from sources other than oil and gas; 
     or
       ``(C) use, for energy-related or marine-related purposes, 
     facilities currently or previously used for activities 
     authorized under this Act.
       ``(2) Payments.--The Secretary shall establish reasonable 
     forms of payments for any easement or right-of-way granted 
     under this subsection. Such payments shall not be assessed on 
     the basis of throughput or production. The Secretary may 
     establish fees, rentals, bonus, or other payments by rule or 
     by agreement with the party to which the lease, easement, or 
     right-of-way is granted. If a lease, easement, right-of-way, 
     license, or permit under this subsection covers a specific 
     tract of, or regards a facility located on, the outer 
     Continental Shelf and is not an easement or right-of-way for 
     transmission or transportation of energy, minerals, or other 
     natural resources, the Secretary shall pay 50 percent of any 
     amount received from the holder of the lease, easement, 
     right-of-way, license, or permit to the State off the shore 
     of which the geographic center of the area covered by the 
     lease, easement, right-of-way, license, permit, or facility 
     is located, in accordance with Federal law determining the 
     seaward lateral boundaries of the coastal States.
       ``(3) Consultation.--Before exercising authority under this 
     subsection, the Secretary shall consult with the Secretary of 
     Defense and other appropriate agencies concerning issues 
     related to national security and navigational obstruction.
       ``(4) Competitive or noncompetitive basis.--
       ``(A) In general.--The Secretary may issue a lease, 
     easement, or right-of-way for energy and related purposes as 
     described in paragraph (1) on a competitive or noncompetitive 
     basis.
       ``(B) Considerations.--In determining whether a lease, 
     easement, or right-of-way shall be granted competitively or 
     noncompetitively, the Secretary shall consider such factors 
     as--
       ``(i) prevention of waste and conservation of natural 
     resources;
       ``(ii) the economic viability of an energy project;
       ``(iii) protection of the environment;
       ``(iv) the national interest and national security;
       ``(v) human safety;
       ``(vi) protection of correlative rights; and
       ``(vii) potential return for the lease, easement, or right-
     of-way.
       ``(5) 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 the Department in which 
     the Coast Guard is operating and other relevant agencies of 
     the Federal Government and affected States, shall issue any 
     necessary regulations to ensure safety, protection of the 
     environment, prevention of waste, and conservation of the 
     natural resources of the outer Continental Shelf, protection 
     of national security interests, and protection of correlative 
     rights in the outer Continental Shelf.
       ``(6) Security.--The Secretary shall require the holder of 
     a lease, easement, or right-of-way granted under this 
     subsection to furnish a surety bond or other form of 
     security, as prescribed by the Secretary, and to comply with 
     such other requirements as the Secretary considers necessary 
     to protect the interests of the United States.
       ``(7) 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.

[[Page 7231]]

       ``(8) Applicability.--This subsection does not apply to any 
     area on the outer Continental Shelf designated as a National 
     Marine Sanctuary.''.
       (b) 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.--''.
       (c) Savings Provision.--Nothing in the amendment made by 
     subsection (a) requires, with respect to any project--
       (1) for which offshore test facilities have been 
     constructed before the date of enactment of this Act; or
       (2) for which a request for proposals has been issued by a 
     public authority,
     any resubmittal of documents previously submitted or any 
     reauthorization of actions previously authorized.

     SEC. 2011. 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. 2012. 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. 2013. DEADLINE FOR DECISION ON APPEALS OF CONSISTENCY 
                   DETERMINATION UNDER THE COASTAL ZONE MANAGEMENT 
                   ACT OF 1972.

       (a) In General.--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.--The Secretary shall publish an 
     initial notice in the Federal Register not later than 30 days 
     after the date of the filing of any appeal to the Secretary 
     of a consistency determination under section 307.
       ``(b) Closure of Record.--
       ``(1) In general.--Not later than the end of the 120-day 
     period beginning on the date of publication of an initial 
     notice under subsection (a), the Secretary shall receive no 
     more filings on the appeal and the administrative record 
     regarding the appeal shall be closed.
       ``(2) Notice.--Upon the closure of the administrative 
     record, the Secretary shall immediately publish a notice that 
     the administrative record has been closed.
       ``(c) Deadline for Decision.--The Secretary shall issue a 
     decision in any appeal filed under section 307 not later than 
     120 days after the closure of the administrative record.
       ``(d) Application.--This section applies to appeals 
     initiated by the Secretary and appeals filed by an 
     applicant.''.
       (b) Application.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendment made by subsection (a) shall apply with respect to 
     any appeal initiated or filed before, on, or after the date 
     of enactment of this Act.
       (2) Limitation.--Subsection (a) of section 319 of the 
     Coastal Zone Management Act of 1972 (as amended by subsection 
     (a)) shall not apply with respect to an appeal initiated or 
     filed before the date of enactment of this Act.
       (c) Closure of Record for Appeal Filed Before Date of 
     Enactment.--Notwithstanding section 319(b)(1) of the Coastal 
     Zone Management Act of 1972 (as amended by this

[[Page 7232]]

     section), in the case of an appeal of a consistency 
     determination under section 307 of that Act initiated or 
     filed before the date of enactment of this Act, the Secretary 
     of Commerce shall receive no more filings on the appeal and 
     the administrative record regarding the appeal shall be 
     closed not later than 120 days after the date of enactment of 
     this Act.

     SEC. 2014. REIMBURSEMENT FOR COSTS OF NEPA ANALYSES, 
                   DOCUMENTATION, AND STUDIES.

       (a) In General.--The Mineral Leasing Act is amended by 
     inserting after section 37 (30 U.S.C. 193) the following:


   ``Reimbursement for costs of certain analyses, documentation, and 
                                studies

       ``Sec. 38. (a) In General.--The Secretary of the Interior 
     shall issue regulations under which the Secretary shall 
     reimburse a person that is a lessee, operator, operating 
     rights owner, or applicant for any lease under this Act for 
     reasonable amounts paid by the person for preparation for the 
     Secretary by a contractor or other person selected by the 
     Secretary of any project-level analysis, documentation, or 
     related study required pursuant to the National Environmental 
     Policy Act of 1969 (42 U.S.C. 4321 et seq.) with respect to 
     the lease.
       ``(b) Conditions.--The Secretary may provide reimbursement 
     under subsection (a) only if--
       ``(1) adequate funding to enable the Secretary to timely 
     prepare the analysis, documentation, or related study is not 
     appropriated;
       ``(2) the person paid the costs voluntarily;
       ``(3) the person maintains records of its costs in 
     accordance with regulations issued by the Secretary;
       ``(4) the reimbursement is in the form of a reduction in 
     the Federal share of the royalty required to be paid for the 
     lease for which the analysis, documentation, or related study 
     is conducted, and is agreed to by the Secretary and the 
     person reimbursed prior to commencing the analysis, 
     documentation, or related study; and
       ``(5) the agreement required under paragraph (4) contains 
     provisions--
       ``(A) reducing royalties owed on lease production based on 
     market prices;
       ``(B) stipulating an automatic termination of the royalty 
     reduction upon recovery of documented costs; and
       ``(C) providing a process by which the lessee may seek 
     reimbursement for circumstances in which production from the 
     specified lease is not possible.''.
       (b) Application.--The amendment made by this section shall 
     apply with respect to an analysis, documentation, or a 
     related study conducted on or after the date of enactment of 
     this Act for any lease entered into before, on, or after the 
     date of enactment of this Act.
       (c) Deadline for Regulations.--The Secretary shall issue 
     regulations implementing the amendment made by this section 
     by not later than 1 year after the date of enactment of this 
     Act.

     SEC. 2015. GAS HYDRATE PRODUCTION INCENTIVE.

       (a) Purpose.--The purpose of this section is to promote 
     natural gas production from the abundant 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 of the Interior shall grant 
     royalty relief in accordance with this section for natural 
     gas produced from gas hydrate resources under any lease that 
     is an eligible lease under paragraph (2).
       (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 the gas 
     hydrate resources commences prior to January 1, 2018.
       (3) Amount of relief.--The Secretary shall grant royalty 
     relief under this section as a suspension volume of at least 
     50 billion cubic feet of natural gas produced from gas 
     hydrate resources per 9 square mile leased tract. 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. The 
     minimum suspension volume under this section for leased 
     tracts that are smaller or larger than nine square miles 
     shall be adjusted on a proportional basis.
       (4) Limitation.--The Secretary may place limitations on the 
     suspension of royalty relief granted 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.--The Secretary shall complete any 
     rulemakings implementing this section within 1 year after the 
     date of enactment of this Act.
       (e) Gas Hydrate Resources Defined.--In this section, the 
     term ``gas hydrate resources'' includes 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.

     SEC. 2016. ONSHORE DEEP GAS PRODUCTION INCENTIVE.

       (a) Purpose.--The purpose of this section is to promote 
     natural gas production from the abundant onshore deep gas 
     resources on Federal lands by providing royalty incentives.
       (b) Suspension of Royalties.--
       (1) In general.--The Secretary shall grant royalty relief 
     in accordance with this section for natural gas produced from 
     deep wells spudded after the date of enactment of this Act 
     under any onshore Federal oil and gas lease.
       (2) Amount of relief.--The Secretary shall grant royalty 
     relief under this section as a suspension volume determined 
     by the Secretary in an amount necessary to maximize 
     production of natural gas volumes. The maximum suspension 
     volume shall be 50 billion cubic feet of natural gas per 
     lease. Such royalty suspension volume shall be applied 
     beginning with the first dollar of royalty obligation for 
     production on or after the date of enactment of this Act.
       (3) Limitation.--The Secretary may place limitations on the 
     suspension of royalty relief granted based on market price.
       (c) Application.--This section shall apply to any onshore 
     Federal oil and gas lease issued before, on, or after the 
     date of enactment of this Act.
       (d) Rulemakings.--
       (1) Requirement.--The Secretary shall complete any 
     rulemakings implementing this section within 1 year after the 
     date of enactment of this Act.
       (2) Definition of deep well.--Such regulations shall 
     include a definition of the term ``deep well'' for purposes 
     of this section.

     SEC. 2017. ENHANCED OIL AND NATURAL GAS PRODUCTION INCENTIVE.

       (a) Findings.--Congress finds the following:
       (1) Approximately two-thirds of the original oil in place 
     in the United States remains unproduced.
       (2) 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 
     in the United States by 2 million barrels of oil equivalent 
     per day, or more.
       (3) Collection of carbon dioxide and other appropriate 
     gases from industrial facilities could provide a significant 
     source of these gases that could be permanently sequestered 
     into oil and natural gas fields.
       (4) Such collection could be made economic by providing 
     production incentives to oil and natural gas lessees.
       (5) Providing production incentives for enhanced oil and 
     natural gas production would promote significant advances in 
     emissions control and capture technology.
       (6) Capturing and productively using industrial emissions 
     of carbon dioxide would help reduce the carbon intensity of 
     the economy.
       (7) Enhanced production of oil and natural gas lessens the 
     potential for environmental impacts when compared with 
     development of new oil and natural gas fields because the 
     infrastructure, such as wells, pipelines, and platforms, is 
     generally already in place.
       (b) Purpose.--The purpose of this section is--
       (1) to promote the capturing, transportation, and injection 
     of produced carbon dioxide, natural carbon dioxide, and other 
     appropriate gases for sequestration into oil and gas fields; 
     and
       (2) to promote oil and natural gas production from the 
     abundant resources on the outer Continental Shelf and onshore 
     Federal lands by enhancing recovery of oil or natural gas (or 
     both).
       (c) Suspension of Royalties.--
       (1) In general.--The Secretary of the Interior shall grant 
     a royalty relief in accordance with this section for 
     production of oil or natural gas (or both) from lands subject 
     to an eligible lease into which the lessee injects carbon 
     dioxide, or other appropriate gas or other matter approved by 
     the Secretary, for the purpose of enhancing recovery of oil 
     or natural gas (or both) from the eligible lease.
       (2) Eligible leases.--A lease shall be an eligible lease 
     for purposes of this section if it is a lease for production 
     of oil or gas (or both) from Federal outer Continental Shelf 
     or onshore lands that the Secretary determines may contain a 
     volume of oil or natural gas that would not likely be 
     produced without royalty relief under this subsection.
       (3) Amount of relief.--The Secretary shall grant royalty 
     relief under this section as a suspension volume determined 
     by the Secretary in an amount necessary to maximize 
     production of oil and natural gas volumes. The maximum 
     suspension volume shall be 50 billion cubic feet of natural 
     gas, or equivalent oil volume on a Btu basis, or a 
     combination thereof, per eligible lease.
       (4) Limitation.--The Secretary may place limitations on the 
     suspension of royalty relief granted based on market price.
       (d) Application.--This section shall apply to any eligible 
     lease issued before, on, or after the date of enactment of 
     this Act.
       (e) Rulemakings.--The Secretary shall complete any 
     rulemakings implementing this provision within 1 year after 
     the date of enactment of this Act.

     SEC. 2018. OIL SHALE.

       (a) Finding.--Congress finds that oil shale resources 
     located within the United States--
       (1) total almost 2 trillion barrels of oil in place; and

[[Page 7233]]

       (2) are a strategically important domestic resource that 
     should be developed on an accelerated basis to reduce our 
     growing reliance on politically and economically unstable 
     sources of foreign oil imports.
       (b) Requirement to Develop Oil Shale Leasing Program.--The 
     Secretary of the Interior shall develop a Federal commercial 
     oil shale leasing program as soon as practicable and publish 
     a final regulation implementing such program by not later 
     than December 31, 2006.
       (c) Commencement of Lease Sales.--The Secretary shall hold 
     the first oil shale lease sale under such program within 180 
     days after publishing the final regulation.
       (d) Report.--Within 90 days after the date of enactment of 
     this Act, the Secretary 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 under subsection (b);
       (B) promulgate the final regulation under subsection (b); 
     and
       (C) conduct the first lease sale under the program under 
     subsection (b); and
       (2) a schedule for completing such actions.
       (e) Oil Shale Land Exchanges.--
       (1) Requirement.--The Secretary shall identify and pursue 
     to completion oil shale land exchanges, on a value-for-value 
     basis, that will allow qualified oil shale developers to have 
     early access to currently owned Federal oil shale lands and 
     to commence commercial oil shale development.
       (2) Applicable law.--The Secretary shall conduct land 
     exchanges under this subsection in accordance with the 
     Federal Land Policy Management Act of 1976 (43 U.S.C. 1701 et 
     seq.) and the Federal Land Exchange Facilitation Act of 1988 
     (43 U.S.C. 1701 note).

     SEC. 2019. USE OF INFORMATION ABOUT OIL AND GAS PUBLIC 
                   CHALLENGES.

       (a) Findings.--Congress finds the following:
       (1) The Government Accountability Office (in this section 
     referred to as the ``GAO''), in report GAO-05-124, found that 
     the Bureau of Land Management does not systematically gather 
     and use nationwide information on public challenges to manage 
     its oil and gas program.
       (2) The GAO found that this failure prevents the Director 
     of the Bureau from assessing the impact of public challenges 
     on the workload of the Bureau of Land Management State 
     offices and eliminates the ability of the Director to make 
     appropriate staffing and funding resource allocation 
     decisions.
       (b) Requirement.--The Secretary of the Interior and the 
     Secretary of Agriculture shall systematically collect and use 
     nationwide information on public challenges to manage the oil 
     and gas programs of the bureaus within their departments. The 
     Secretaries shall gather such information at the planning, 
     leasing, exploration, and development stages, and shall 
     maintain such information electronically with current data.

                   Subtitle B--Access to Federal Land

     SEC. 2021. OFFICE OF FEDERAL ENERGY PROJECT COORDINATION.

       (a) Establishment.--The President shall establish the 
     Office of Federal Energy Project Coordination (referred to in 
     this section as the ``Office'') within the Executive Office 
     of the President in the same manner and with the same mission 
     as the White House Energy Projects Task Force established by 
     Executive Order No. 13212 (42 U.S.C. 13201 note).
       (b) Staffing.--The Office shall be staffed by functional 
     experts from relevant Federal agencies on a nonreimbursable 
     basis to carry out the mission of the Office.
       (c) Report.--The Office shall transmit an annual report to 
     Congress that describes the activities put in place to 
     coordinate and expedite Federal decisions on energy projects. 
     The report shall list accomplishments in improving the 
     Federal decisionmaking process and shall include any 
     additional recommendations or systemic changes needed to 
     establish a more effective and efficient Federal permitting 
     process.

     SEC. 2022. 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. 2023. MANAGEMENT OF FEDERAL OIL AND GAS LEASING 
                   PROGRAMS.

       (a) Timely Action on Leases and Permits.--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 (in this section referred to as the 
     ``Secretary'') shall--
       (1) ensure expeditious compliance with section 102(2)(C) of 
     the National Environmental Policy Act of 1969 (42 U.S.C. 
     4332(2)(C));
       (2) improve consultation and coordination with the States 
     and the public; and
       (3) improve the collection, storage, and retrieval of 
     information relating to the 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 lands 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 2022.
       (3) Regulations.--Not later than 180 days after the 
     development of 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 practices, 
     including deadlines for--
       (A) approving or disapproving resource management plans and 
     related documents, lease applications, and surface use plans; 
     and
       (B) related administrative appeals.
       (c) Improved Enforcement.--The Secretary shall improve 
     inspection and enforcement of oil and gas activities, 
     including enforcement of terms and conditions in permits to 
     drill.
       (d) Authorization of Appropriations.--In addition to 
     amounts authorized to be appropriated to carry out section 17 
     of the Mineral Leasing Act (30 U.S.C. 226), there are 
     authorized to be appropriated to the Secretary for each of 
     fiscal years 2006 through 2009--
       (1) $40,000,000 to carry out subsections (a) and (b); and
       (2) $20,000,000 to carry out subsection (c).

     SEC. 2024. 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 lands under the jurisdiction of the Secretary of 
     the Interior; and
       (2) National Forest System lands under the jurisdiction of 
     the Secretary of Agriculture.
       (b) Contents.--The memorandum of understanding shall 
     include provisions that--
       (1) establish administrative procedures and lines of 
     authority that ensure timely processing of oil and gas lease 
     applications, surface use plans of operation, and 
     applications for permits to drill, including steps for 
     processing surface use plans and applications for permits to 
     drill consistent with the timelines established by the 
     amendment made by section 2028;
       (2) eliminate duplication of effort by providing for 
     coordination of planning and environmental compliance 
     efforts; and
       (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.
       (c) Data Retrieval System.--
       (1) In general.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary of the Interior and the 
     Secretary of Agriculture shall 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.
       (2) Resource mapping.--Not later than 2 years after the 
     date of enactment of this Act, the Secretary of the Interior 
     and the Secretary of Agriculture shall 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.

[[Page 7234]]



     SEC. 2025. 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. 2026. COMPLIANCE WITH EXECUTIVE ORDER 13211; ACTIONS 
                   CONCERNING REGULATIONS THAT SIGNIFICANTLY 
                   AFFECT ENERGY SUPPLY, DISTRIBUTION, OR USE.

       (a) Requirement.--The head of each Federal agency shall 
     require that before the Federal agency takes any action that 
     could have a significant adverse effect on the supply of 
     domestic energy resources from Federal public land, the 
     Federal agency taking the action shall comply with Executive 
     Order No. 13211 (42 U.S.C. 13201 note).
       (b) Guidance.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary of Energy shall publish 
     guidance for purposes of this section describing what 
     constitutes a significant adverse effect on the supply of 
     domestic energy resources under Executive Order No. 13211 (42 
     U.S.C. 13201 note).
       (c) Memorandum of Understanding.--The Secretary of the 
     Interior and the Secretary of Agriculture shall include in 
     the memorandum of understanding under section 2024 provisions 
     for implementing subsection (a) of this section.

     SEC. 2027. PILOT PROJECT TO IMPROVE FEDERAL PERMIT 
                   COORDINATION.

       (a) Establishment.--The Secretary of the Interior (in this 
     section referred to as the ``Secretary'') shall establish a 
     Federal Permit Streamlining Pilot Project (in this section 
     referred to 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 with the Secretary of 
     Agriculture, the Administrator of the Environmental 
     Protection Agency, and the Chief of Engineers of the Army 
     Corps of Engineers for purposes of this section.
       (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 assign to 
     each of the field offices identified in subsection (d), on a 
     nonreimbursable basis, 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) Glenwood Springs, Colorado.
       (7) Vernal, Utah.
       (e) Reports.--Not later than 3 years after the date of 
     enactment of this Act, the Secretary shall transmit 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) 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. 2028. 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; or
       ``(B)(i) defer decision on the permit; and
       ``(ii) provide to the applicant a notice that specifies any 
     steps that the applicant could take for the permit to be 
     issued.
       ``(3) Requirements for deferred applications.--
       ``(A) In general.--If the Secretary provides notice under 
     paragraph (2)(B)(ii), 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 (42 U.S.C. 4321 
     et seq.).
       ``(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).
       ``(C) Denial of permit.--If the applicant does not complete 
     the requirements within the period specified in subparagraph 
     (A), the Secretary shall deny the permit.
       ``(q) Report.--On a quarterly basis, each field office of 
     the Bureau of Land Management and the Forest Service shall 
     transmit to the Secretary of the Interior or the Secretary of 
     Agriculture, respectively, a report that--
       ``(1) specifies the number of applications for permits to 
     drill received by the field office in the period covered by 
     the report; and
       ``(2) describes how each of the applications was disposed 
     of by the field office in accordance with subsection (p).''.

     SEC. 2029. CLARIFICATION OF FAIR MARKET RENTAL VALUE 
                   DETERMINATIONS FOR PUBLIC LAND AND FOREST 
                   SERVICE RIGHTS-OF-WAY.

       (a) Linear Rights-of-Way Under Federal Land Policy and 
     Management Act of 1976.--Section 504 of the Federal Land 
     Policy and Management Act of 1976 (43 U.S.C. 1764) is amended 
     by adding at the end the following:
       ``(k) Determination of Fair Market Value of Linear Rights-
     of-Way.--
       ``(1) In general.--Effective beginning on the date of the 
     issuance of the rules required by paragraph (2), for purposes 
     of subsection (g), the Secretary concerned shall determine 
     the fair market value for the use of land encumbered by a 
     linear right-of-way granted, issued, or renewed under this 
     title using the valuation method described in paragraphs (2), 
     (3), and (4).

[[Page 7235]]

       ``(2) Revisions.--Not later than 1 year after the date of 
     enactment of this subsection--
       ``(A) the Secretary of the Interior shall amend section 
     2803.1-2 of title 43, Code of Federal Regulations, as in 
     effect on the date of enactment of this subsection, 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
       ``(B) the Secretary of Agriculture shall make the same 
     revision for linear rights-of-way granted, issued, or renewed 
     under this title on National Forest System land.
       ``(3) Updates.--The Secretary concerned shall annually 
     update the schedule revised under paragraph (2) by 
     multiplying the current year's rental per acre by the annual 
     change, second quarter to second quarter (June 30 to June 30) 
     in the Gross National Product Implicit Price Deflator Index 
     published in the Survey of Current Business of the Department 
     of Commerce, Bureau of Economic Analysis.
       ``(4) Review.--If the cumulative change in the index 
     referred to in paragraph (3) exceeds 30 percent, or the 
     change in the 3-year average of the 1-year Treasury interest 
     rate used to determine per acre rental fee zone values 
     exceeds plus or minus 50 percent, the Secretary concerned 
     shall conduct a review of the zones and rental per acre 
     figures to determine whether the value of Federal land has 
     differed sufficiently from the index referred to in paragraph 
     (3) to warrant a revision in the base zones and rental per 
     acre figures. If, as a result of the review, the Secretary 
     concerned determines that such a revision is warranted, the 
     Secretary concerned shall revise the base zones and rental 
     per acre figures accordingly. Any revision of base zones and 
     rental per acre figure shall only affect lease rental rates 
     at inception or renewal.''.
       (b) Rights-of-Way Under Mineral Leasing Act.--Section 28(l) 
     of the Mineral Leasing Act (30 U.S.C. 185(l)) is amended by 
     inserting before the period at the end the following: ``using 
     the valuation method described in section 2803.1-2 of title 
     43, Code of Federal Regulations, as revised in accordance 
     with section 504(k) of the Federal Land Policy and Management 
     Act of 1976 (43 U.S.C. 1764(k))''.

     SEC. 2030. ENERGY FACILITY RIGHTS-OF-WAY AND CORRIDORS ON 
                   FEDERAL LAND.

       (a) Report to Congress.--
       (1) In general.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary of Agriculture and the 
     Secretary of the Interior, in consultation with the Secretary 
     of Commerce, the Secretary of Defense, the Secretary of 
     Energy, and the Federal Energy Regulatory Commission, shall 
     submit to Congress a joint report--
       (A) that addresses--
       (i) the location of existing rights-of-way and designated 
     and de facto corridors for oil, gas, and hydrogen pipelines 
     and electric transmission and distribution facilities on 
     Federal land; and
       (ii) opportunities for additional oil, gas, and hydrogen 
     pipeline and electric transmission capacity within those 
     rights-of-way and corridors; and
       (B) that includes a plan for making available, on request, 
     to the appropriate Federal, State, and local agencies, tribal 
     governments, and other persons involved in the siting of oil, 
     gas, and hydrogen pipelines and electricity transmission 
     facilities Geographic Information System-based information 
     regarding the location of the existing rights-of-way and 
     corridors and any planned rights-of-way and corridors.
       (2) Consultations and considerations.--In preparing the 
     report, the Secretary of the Interior and the Secretary of 
     Agriculture shall consult with--
       (A) other agencies of Federal, State, tribal, or local 
     units of government, as appropriate;
       (B) persons involved in the siting of oil, gas, and 
     hydrogen pipelines and electric transmission facilities; and
       (C) other interested members of the public.
       (3) Limitation.--The Secretary of the Interior and the 
     Secretary of Agriculture shall limit the distribution of the 
     report and Geographic Information System-based information 
     referred to in paragraph (1) as necessary for national and 
     infrastructure security reasons, if either Secretary 
     determines that the information may be withheld from public 
     disclosure under a national security or other exception under 
     section 552(b) of title 5, United States Code.
       (b) Corridor Designations.--
       (1) 11 contiguous 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 consultation with the Federal Energy Regulatory 
     Commission and the affected utility industries, shall 
     jointly--
       (A) designate, under title V of the Federal Land Policy and 
     Management Act of 1976 (43 U.S.C. 1761 et seq.) and other 
     applicable Federal laws, corridors for oil, gas, and hydrogen 
     pipelines and electricity transmission and facilities on 
     Federal land in the eleven contiguous Western States (as 
     defined in section 103 of the Federal Land Policy and 
     Management Act of 1976 (43 U.S.C. 1702));
       (B) perform any environmental reviews that may be required 
     to complete the designations of corridors for the facilities 
     on Federal land in the eleven contiguous Western States; and
       (C) incorporate the designated corridors into--
       (i) the relevant departmental and agency land use and 
     resource management plans; or
       (ii) equivalent plans.
       (2) Other states.--Not later than 4 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 
     consultation with the Federal Energy Regulatory Commission 
     and the affected utility industries, shall jointly--
       (A) identify corridors for oil, gas, and hydrogen pipelines 
     and electricity transmission and distribution facilities on 
     Federal land in the States other than those described in 
     paragraph (1); and
       (B) schedule prompt action to identify, designate, and 
     incorporate the corridors into the land use plan.
       (3) Ongoing responsibilities.--The Secretary of 
     Agriculture, the Secretary of Commerce, the Secretary of 
     Defense, the Secretary of Energy, and the Secretary of the 
     Interior, with respect to lands under their respective 
     jurisdictions, in consultation with the Federal Energy 
     Regulatory Commission and the affected utility industries, 
     shall establish procedures that--
       (A) ensure that additional corridors for oil, gas, and 
     hydrogen pipelines and electricity transmission and 
     distribution facilities on Federal land are promptly 
     identified and designated; and
       (B) expedite applications to construct or modify oil, gas, 
     and hydrogen pipelines and electricity transmission and 
     distribution facilities within the corridors, taking into 
     account prior analyses and environmental reviews undertaken 
     during the designation of corridors.
       (c) 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.
       (d) Definition of Corridor.--
       (1) In general.--In this section and title V of the Federal 
     Land Policy and Management Act of 1976 (43 U.S.C. 1761 et 
     seq.), the term ``corridor'' means--
       (A) a linear strip of land--
       (i) with a width determined with consideration given to 
     technological, environmental, and topographical factors; and
       (ii) that contains, or may in the future contain, 1 or more 
     utility, communication, or transportation facilities;
       (B) a land use designation that is established--
       (i) by law;
       (ii) by Secretarial Order;
       (iii) through the land use planning process; or
       (iv) by other management decision; and
       (C) a designation made for the purpose of establishing the 
     preferred location of compatible linear facilities and land 
     uses.
       (2) Specifications of corridor.--On designation of a 
     corridor under this section, the centerline, width, and 
     compatible uses of a corridor shall be specified.

     SEC. 2031. 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

[[Page 7236]]

     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. 2032. ELECTRICITY TRANSMISSION LINE RIGHT-OF-WAY, 
                   CLEVELAND NATIONAL FOREST AND ADJACENT PUBLIC 
                   LAND, CALIFORNIA.

       (a) Issuance.--
       (1) In general.--Not later than 60 days after the 
     completion of the environmental reviews under subsection (c), 
     the Secretary of the Interior and the Secretary of 
     Agriculture shall issue all necessary grants, easements, 
     permits, plan amendments, and other approvals to allow for 
     the siting and construction of a high-voltage electricity 
     transmission line right-of-way running approximately north to 
     south through the Trabuco Ranger District of the Cleveland 
     National Forest in the State of California and adjacent lands 
     under the jurisdiction of the Bureau of Land Management and 
     the Forest Service.
       (2) Inclusions.--The right-of-way approvals under paragraph 
     (1) shall provide all necessary Federal authorization from 
     the Secretary of the Interior and the Secretary of 
     Agriculture for the routing, construction, operation, and 
     maintenance of a 500-kilovolt transmission line capable of 
     meeting the long-term electricity transmission needs of the 
     region between the existing Valley-Serrano transmission line 
     to the north and the Telega-Escondido transmission line to 
     the south, and for connecting to future generating capacity 
     that may be developed in the region.
       (b) Protection of Wilderness Areas.--The Secretary of the 
     Interior and the Secretary of Agriculture shall not allow any 
     portion of a transmission line right-of-way corridor 
     identified in subsection (a) to enter any identified 
     wilderness area in existence as of the date of enactment of 
     this Act.
       (c) Environmental and Administrative Reviews.--
       (1) Department of interior or local agency.--The Secretary 
     of the Interior, acting through the Director of the Bureau of 
     Land Management, shall be the lead Federal agency with 
     overall responsibility to ensure completion of required 
     environmental and other reviews of the approvals to be issued 
     under subsection (a).
       (2) National forest system land.--For the portions of the 
     corridor on National Forest System lands, the Secretary of 
     Agriculture shall complete all required environmental reviews 
     and administrative actions in coordination with the Secretary 
     of the Interior.
       (3) Expeditious completion.--The reviews required for 
     issuance of the approvals under subsection (a) shall be 
     completed not later than 1 year after the date of enactment 
     of this Act.
       (d) Other Terms and Conditions.--The transmission line 
     right-of-way shall be subject to such terms and conditions as 
     the Secretary of the Interior and the Secretary of 
     Agriculture consider necessary, based on the environmental 
     reviews under subsection (c), to protect the value of 
     historic, cultural, and natural resources under the 
     jurisdiction of the Secretary of the Interior or the 
     Secretary of Agriculture.
       (e) Preference Among Proposals.--The Secretary of the 
     Interior and the Secretary of Agriculture shall give a 
     preference to any application or preapplication proposal for 
     a transmission line right-of-way referred to in subsection 
     (a) that was submitted before December 31, 2002, over all 
     other applications and proposals for the same or a similar 
     right-of-way submitted on or after that date.

     SEC. 2033. 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. 2034. LIVINGSTON PARISH MINERAL RIGHTS TRANSFER.

       (a) Amendments.--Section 102 of Public Law 102-562 (106 
     Stat. 4234) is amended--
       (1) by striking ``(a) In General.--'';
       (2) by striking ``and subject to the reservation in 
     subsection (b),''; and
       (3) by striking subsection (b).
       (b) Implementation of Amendment.--The Secretary of the 
     Interior shall execute the legal instruments necessary to 
     effectuate the amendment made by subsection (a)(3).

                  Subtitle C--Naval Petroleum Reserves

     SEC. 2041. 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 of Energy to the Secretary of the Interior for 
     management, subject to subsection (c), in accordance with the 
     general land laws.
       (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 2042 of this Act.
       (c) Purpose of Transfer.--Notwithstanding any other 
     provision of law, the principle 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 only to prevent unnecessary 
     degradation and to provide for ultimate economic recovery of 
     the resources.
       (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. 2042. 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 167 acres 
     located in the N\1/2\ of section 18, township 32 south, range 
     24 east, Mount Diablo meridian, more fully described as 
     Parcels 1 and 2 according to the

[[Page 7237]]

     Record of Survey filed on July 1, 1974, in Book 11 of Record 
     Surveys at page 68, County of Kern, State of 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 of 
     Energy 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. 2043. 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.

     SEC. 2044. EFFECT OF TRANSFER AND CONVEYANCE.

       Nothing in this Act shall be construed----
       (1) to impose on the Secretary of Energy any new liability 
     or responsibility that the Secretary of Energy did not bear 
     before the date of the enactment of this Act; or
       (2) to increase the level of responsibility of the 
     Secretary of Energy with respect to any responsibility borne 
     by the Secretary of Energy before that date.

                  Subtitle D--Miscellaneous Provisions

     SEC. 2051. 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.

     SEC. 2052. 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 January 1, 2006, and ending on the date on which 
     the Secretary of the Treasury publishes a certification under 
     subsection (a)(4)(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. 2053. DOMESTIC OFFSHORE ENERGY REINVESTMENT.

       The Outer Continental Shelf Lands Act (43 U.S.C. 1331 et 
     seq.) is amended by adding at the end the following:

     ``SEC. 32. DOMESTIC OFFSHORE ENERGY REINVESTMENT PROGRAM.

       ``(a) Definitions.--In this section:
       ``(1) Coastal energy state.--The term `Coastal Energy 
     State' means a Coastal State off the coastline of which, 
     within the seaward lateral boundary as determined under 
     section 4, outer Continental Shelf bonus bids or royalties 
     are generated.
       ``(2) Coastal political subdivision.--The term `coastal 
     political subdivision' means a county, parish, or other 
     equivalent subdivision of a Coastal Energy State, all or part 
     of which lies within the boundaries of the coastal zone of 
     the State, as identified in the State's approved coastal zone 
     management program under the Coastal Zone Management Act of 
     1972 (16 U.S.C. 1451 et seq.) on the date of the enactment of 
     this section.
       ``(3) Coastal population.--The term `coastal population' 
     means the population of a coastal political subdivision, as 
     determined by the most recent official data of the Census 
     Bureau.
       ``(4) Coastline.--The term `coastline' has the same meaning 
     as the term `coast line' in subsection 2(c) of the Submerged 
     Lands Act (43 U.S.C. 1301(c)).
       ``(5) Fund.--The term `Fund' means the Secure Energy 
     Reinvestment Fund established by this section.
       ``(6) Leased tract.--The term `leased tract' means a tract 
     maintained under section 6 or leased under section 8 for the 
     purpose of drilling for, developing, and producing oil and 
     natural gas resources.
       ``(7) Qualified outer continental shelf revenues.--The term 
     `qualified outer Continental Shelf revenues' means all 
     amounts received by the United States on or after October 1, 
     2005, from each leased tract or portion of a leased tract 
     lying seaward of the zone defined and governed by section 
     8(g), or lying within such zone but to which section 8(g) 
     does not apply, including bonus bids, rents, royalties 
     (including payments for royalties taken in kind and sold), 
     net profit share payments, and related interest.
       ``(8) Secretary.--The term `Secretary' means the Secretary 
     of the Interior.
       ``(b) Secure Energy Reinvestment Fund.--
       ``(1) Establishment.--There is established in the Treasury 
     of the United States a separate account which shall be known 
     as the `Secure Energy Reinvestment Fund'. The Fund shall 
     consist of amounts deposited under paragraph (2).
       ``(2) Deposits.--For each of fiscal years 2006 through 
     2015, the Secretary of the Treasury shall deposit into the 
     Fund, subject to appropriations, the following:
       ``(A) Notwithstanding section 9, all qualified outer 
     Continental Shelf revenues attributable to royalties received 
     by the United States in the fiscal year that are in excess of 
     the following amount:
       ``(i) $7,000,000,000 in the case of royalties received in 
     fiscal year 2006.
       ``(ii) $7,100,000,000 in the case of royalties received in 
     fiscal year 2007.
       ``(iii) $7,300,000,000 in the case of royalties received in 
     fiscal year 2008.
       ``(iv) $6,900,000,000 in the case of royalties received in 
     fiscal year 2009.
       ``(v) $7,200,000,000 in the case of royalties received in 
     fiscal year 2010.
       ``(vi) $7,250,000,000 in the case of royalties received in 
     fiscal year 2011.
       ``(vii) $8,125,000,000 in the case of royalties received in 
     fiscal year 2012.
       ``(viii) $8,100,000,000 in the case of royalties received 
     in fiscal year 2013.
       ``(ix) $9,000,000,000 in the case of royalties received in 
     fiscal year 2014.
       ``(x) $7,500,000,000 in the case of royalties received in 
     fiscal year 2015.
       ``(B) Notwithstanding section 9, all qualified outer 
     Continental shelf revenues attributable to bonus bids 
     received by the United States in each of the fiscal years 
     2006 through 2015 that are in excess of $880,000,000.

[[Page 7238]]

       ``(C) Notwithstanding section 9, in addition to amounts 
     deposited under subparagraphs (A) and (B), $35,000,000 of 
     amounts received by the United States each fiscal year as 
     royalties for oil or gas production on the outer Continental 
     Shelf.
       ``(D) All interest earned under paragraph (4).

     In no event shall deposits under subparagraphs (A) through 
     (C) total more than $50,000,000 per fiscal year.
       ``(3) Deposits after fiscal year 2015.--For each fiscal 
     year after fiscal year 2015, the Secretary of the Treasury 
     shall deposit into the Fund the following:
       ``(A) 25 percent of qualified outer Continental Shelf 
     revenues received by the United States in the preceding 
     fiscal year.
       ``(B) All interest earned under paragraph (4).
       ``(4) Investment.--The Secretary of the Treasury shall 
     invest moneys in the Fund (including interest) in public debt 
     securities with maturities suitable to the needs of the Fund, 
     as determined by the Secretary of the Treasury, and bearing 
     interest at rates determined by the Secretary of the 
     Treasury, taking into consideration current market yields on 
     outstanding marketable obligations of the United States of 
     comparable maturity. Such invested moneys shall remain 
     invested until needed to meet requirements for disbursement 
     under this section.
       ``(c) Use of Secure Energy Reinvestment Fund.--
       ``(1) In general.--(A) The Secretary shall use amounts in 
     the Fund remaining after the application of subsection (d) to 
     pay to each Coastal Energy State, and to coastal political 
     subdivisions of such State, the amount allocated to the State 
     or coastal political subdivision, respectively, under this 
     subsection.
       ``(B) The Secretary shall make payments under this 
     paragraph in December of 2006, and of each year thereafter, 
     from revenues received by the United States in the preceding 
     fiscal year.
       ``(2) Allocation.--The Secretary shall allocate amounts 
     deposited into the Fund in a fiscal year, and other amounts 
     determined by the Secretary to be available, among Coastal 
     Energy States, and to coastal political subdivisions of such 
     States, as follows:
       ``(A)(i) The allocation for each Coastal Energy State shall 
     be calculated based on the ratio of qualified outer 
     Continental Shelf revenues generated off the coastline of the 
     Coastal Energy State to the qualified outer Continental Shelf 
     revenues generated off the coastlines of all Coastal Energy 
     States for the preceding fiscal year.
       ``(ii) For purposes of this subparagraph, qualified outer 
     Continental Shelf revenues shall be considered to be 
     generated off the coastline of a Coastal Energy State if the 
     geographic center of the lease tract from which the revenues 
     are generated is located within the area formed by the 
     extension of the State's seaward lateral boundaries.
       ``(B) 35 percent of each Coastal Energy State's allocable 
     share as determined under subparagraph (A) shall be allocated 
     among and paid directly to the coastal political subdivisions 
     of the State by the Secretary based on the following formula:
       ``(i) 25 percent shall be allocated based on the ratio of 
     each coastal political subdivision's coastal population to 
     the coastal population of all coastal political subdivisions 
     of the Coastal Energy State.
       ``(ii) 25 percent shall be allocated based on the ratio of 
     each coastal political subdivision's coastline miles to the 
     coastline miles of all coastal political subdivisions of the 
     State. In the case of a coastal political subdivision without 
     a coastline, the coastline of the political subdivision for 
     purposes of this clause shall be one-third the average length 
     of the coastline of the other coastal political subdivisions 
     of the State.
       ``(iii) 50 percent shall be allocated based on a formula 
     that allocates 75 percent of the funds based on such coastal 
     political subdivision's relative distance from any leased 
     tract used to calculate that State's allocation and 25 
     percent of the funds based on the relative level of outer 
     Continental Shelf oil and gas activities in a coastal 
     political subdivision to the level of outer Continental Shelf 
     oil and gas activities in all coastal political subdivisions 
     in such State, as determined by the Secretary.
       ``(d) Administrative Expenses.--Of amounts in the Fund each 
     fiscal year, the Secretary may use up to one-half of one 
     percent for the administrative costs of implementing this 
     section.
       ``(e) Disposition of Funds.--A Coastal Energy State or 
     coastal political subdivision may use funds provided to such 
     entity under this section for any payment that is eligible to 
     be made with funds provided to States under section 35 of the 
     Mineral Leasing Act (30 U.S.C. 191).''.

     SEC. 2054. REPURCHASE OF LEASES THAT ARE NOT ALLOWED TO BE 
                   EXPLORED OR DEVELOPED.

       (a) Authority to Repurchase and Cancel Certain Leases.--
     Notwithstanding any other provisions of law, any Federal oil 
     and gas, geothermal, coal, oil shale, or tar sands lease, 
     whether onshore or offshore, issued by the Secretary, or 
     units of such leases if unitized, that by operation of law, 
     including but not limited to denial of a permit request, (1) 
     is not allowed to be explored in the lawful manner requested 
     by the lessee, or (2) if explored resulting in a commercial 
     discovery is not allowed to be developed or produced in the 
     lawful manner requested by the lessee, shall, upon the 
     written request of the lessee and a finding by the Secretary 
     that such lease qualifies, be authorized for repurchase and 
     cancelled by the Secretary. If a permit, approval, or appeal 
     has been expressly denied and the proposal of the lessee is 
     found by the Secretary not to have been in compliance with 
     law, the lessee shall not be entitled to have the lease 
     repurchased and cancelled. However, if the lessee alleges 
     that the Government has failed to act on a proposal of the 
     lessee within the applicable period of time, the Secretary 
     shall make no inquiry or determination as to whether the 
     contents of the request complied with the law, and the 
     Secretary shall restrict the Secretary's findings to whether 
     or not the Government failed to act within the applicable 
     period of time. The Secretary shall make all decisions under 
     this section within 180 days of request. The area covered by 
     any repurchased and cancelled lease shall remain available 
     for future leasing unless otherwise prohibited by law. For 
     purposes of this section, failure to act within a regulatory 
     or statutory time-frame, whether advisory or mandatory, or if 
     none, within a reasonable period of time not to exceed 180 
     days, on a permit request, administrative appeal, or other 
     request for approval, shall be considered to meet the 
     operation of law requirements of this section. Further, 
     conditions of approval attached to permit approvals shall 
     meet the operation of law requirement of this section if such 
     conditions are not mandated by statute or regulation and not 
     agreed to by the lessee. A lessee shall not be required to 
     exhaust administrative remedies regarding a permit request, 
     administrative appeal, or other required request for approval 
     for the purposes of this section.
       (b) Determination of a Commercial Discovery.--The Secretary 
     shall make any required determination of the existence of a 
     commercial resource discovery. For oil and gas, a commercial 
     discovery is a discovery in paying quantities. The Secretary 
     shall be guided in such a determination by precedent, and by 
     written advice, including input from the lessee.
       (c) Compensation.--Upon authorization by the Secretary of 
     the repurchase of a lease under this section, a lessee shall 
     be compensated in the amount of the total of lease 
     acquisition costs, rentals, seismic acquisition costs, 
     archeological and environmental studies, drilling costs, and 
     other reasonable expenses on the lease, including expenses 
     incurred in the repurchase process, to the extent that the 
     lessee has not previously been compensated by the United 
     States for such expenses. The lessee shall not be compensated 
     for general overhead expenses, employee salaries, or 
     interest. If the lessee is an assignee, the lessee may not 
     claim the expenses of his assignor. Compensation shall be in 
     the form of a check or electronic transfer from the 
     Department of the Treasury from funds deposited into 
     miscellaneous receipts under the authority of the same Act 
     that authorized the issuance of the lease being repurchased. 
     If the Secretary fails to make the repurchase authorization 
     decision under subsection (a) within the required 180 days 
     and the lease is ultimately repurchased, the compensation due 
     to the lessee shall increase by 25 percent, plus 1 percent 
     for every seven days that the decision is delayed beyond the 
     required 180 days.
       (d) Delegation of Authority and Finality of Decisions.--The 
     Secretary may delegate authority granted by this section only 
     to individuals who have been appointed by the President, by 
     and with the advice and consent of the Senate. A decision 
     under this section by the Secretary, or delegated official, 
     shall be considered the final agency decision.
       (e) Regulations.--The Secretary shall issue reasonable 
     regulations implementing this section not later than 1 year 
     after date of enactment of this Act.
       (f) Secretary.--For purposes of this section, the term 
     ``Secretary'' means the Secretary of the Interior.
       (g) No Prejudice.--This section shall not be interpreted to 
     prejudice any other rights that the lessee would have in the 
     absence of this section.

                            TITLE XXI--COAL

     SEC. 2101. SHORT TITLE.

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

     SEC. 2102. LEASE MODIFICATIONS FOR CONTIGUOUS COAL LANDS OR 
                   COAL DEPOSITS.

       Section 3 of the Mineral Leasing Act (30 U.S.C. 203) is 
     amended in the first sentence by striking ``such lease,'' and 
     all that follows through the end of the sentence and 
     inserting ``such lease.''.

     SEC. 2103. 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

[[Page 7239]]

       ``(ii) the longer period is in the interest of the orderly, 
     efficient, or economic development of a coal resource.''.

     SEC. 2104. PAYMENT OF ADVANCE ROYALTIES UNDER COAL LEASES.

       (a) In General.--Section 7(b) of the Mineral Leasing Act 
     (30 U.S.C. 207(b)) is amended to read as follows:
       ``(b)(1) Each lease shall be subjected to the condition of 
     diligent development and continued operation of the mine or 
     mines, except where operations under the lease are 
     interrupted by strikes, the elements, or casualties not 
     attributable to the lessee.
       ``(2)(A) The Secretary of the Interior, upon determining 
     that the public interest will be served thereby, may suspend 
     the condition of continued operation upon the payment of 
     advance royalties.
       ``(B) Such advance royalties shall be computed--
       ``(i) 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
       ``(ii) based on commercial quantities, as defined by 
     regulation by the Secretary of the Interior.
       ``(C) The aggregate number of years during the initial and 
     any extended term of any lease for which advance royalties 
     may be accepted in lieu of the condition of continued 
     operation shall not exceed 20.
       ``(3) The amount of any production royalty paid for any 
     year shall be reduced (but not below zero) by the amount of 
     any advance royalties paid under such lease to the extent 
     that such advance royalties have not been used to reduce 
     production royalties for a prior year.
       ``(4) This subsection shall be applicable to any lease or 
     logical mining unit in existence on the date of the enactment 
     of this paragraph or issued or approved after such date.
       ``(5) Nothing in this subsection shall be construed to 
     affect the requirement contained in the second sentence of 
     subsection (a) relating to commencement of production at the 
     end of 10 years.''.
       (b) Authority to Waive, Suspend, or Reduce Advance 
     Royalties.--Section 39 of the Mineral Leasing Act (30 U.S.C. 
     209) is amended by striking the last sentence.

     SEC. 2105. 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. 2106. 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 for a 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. 2107. INVENTORY REQUIREMENT.

       (a) Review of Assessments.--
       (1) In general.--The Secretary of the Interior, in 
     consultation with the Secretary of Agriculture and the 
     Secretary of Energy, shall review coal assessments and other 
     available data to identify--
       (A) public lands with coal resources;
       (B) the extent and nature of any restrictions or 
     impediments to the development of coal resources on public 
     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. 2108. APPLICATION OF AMENDMENTS.

       The amendments made by this title apply with respect to any 
     coal lease issued before, on, or after the date of the 
     enactment of this Act.

     SEC. 2109. RESOLUTION OF FEDERAL RESOURCE DEVELOPMENT 
                   CONFLICTS IN THE POWDER RIVER BASIN.

       The Secretary of the Interior shall--
       (1) undertake a review of existing authorities to resolve 
     conflicts between the development of Federal coal and the 
     development of Federal and non-Federal coalbed methane in the 
     Powder River Basin in Wyoming and Montana; and
       (2) not later than 6 months after the date of enactment of 
     this Act, report to Congress on alternatives to resolve these 
     conflicts and an identification of a preferred alternative 
     with specific legislative language, if any, required to 
     implement the preferred alternative.

            TITLE XXII--ARCTIC COASTAL PLAIN DOMESTIC ENERGY

     SEC. 2201. SHORT TITLE.

       This title may be cited as the ``Arctic Coastal Plain 
     Domestic Energy Security Act of 2005''.

     SEC. 2202. DEFINITIONS.

       In this title:
       (1) Coastal plain.--The term ``Coastal Plain'' means that 
     area identified as such in the map entitled ``Arctic National 
     Wildlife Refuge'', dated August 1980, as referenced in 
     section 1002(b) of the Alaska National Interest Lands 
     Conservation Act (16 U.S.C. 3142(b)(1)), comprising 
     approximately 1,549,000 acres, and as described in appendix I 
     to part 37 of title 50, Code of Federal Regulations.
       (2) Secretary.--The term ``Secretary'', except as otherwise 
     provided, means the Secretary of the Interior or the 
     Secretary's designee.

     SEC. 2203. LEASING PROGRAM FOR LANDS WITHIN THE COASTAL 
                   PLAIN.

       (a) In General.--The Secretary shall take such actions as 
     are necessary--
       (1) to establish and implement, in accordance with this Act 
     and acting through the Director of the Bureau of Land 
     Management in consultation with the Director of the United 
     States Fish and Wildlife Service, a competitive oil and gas 
     leasing program under the Mineral Leasing Act (30 U.S.C. 181 
     et seq.) that will result in an environmentally sound program 
     for the exploration, development, and production of the oil 
     and gas resources of the Coastal Plain; and
       (2) to administer the provisions of this title through 
     regulations, lease terms, conditions, restrictions, 
     prohibitions, stipulations, and other provisions that ensure 
     the oil and gas exploration, development, and production 
     activities on the Coastal Plain will result in no significant 
     adverse effect on fish and wildlife, their habitat, 
     subsistence resources, and the environment, and including, in 
     furtherance of this goal, by requiring the application of the 
     best commercially available technology for oil and gas 
     exploration, development, and production to all exploration, 
     development, and production operations under this title in a 
     manner that ensures the receipt of fair market value by the 
     public for the mineral resources to be leased.
       (b) Repeal.--
       (1) Repeal.--Section 1003 of the Alaska National Interest 
     Lands Conservation Act (16 U.S.C. 3143) is repealed.
       (2) Clerical amendment.--The table of contents in section 1 
     of such Act is amended by striking the item relating to 
     section 1003.
       (c) Compliance With Requirements Under Certain Other 
     Laws.--
       (1) Compatibility.--For purposes of the National Wildlife 
     Refuge System Administration Act of 1966, the oil and gas 
     leasing program and activities authorized by this section in 
     the Coastal Plain are deemed to be compatible with the 
     purposes for which the Arctic National Wildlife Refuge was 
     established, and that no further findings or decisions are 
     required to implement this determination.
       (2) Adequacy of the department of the interior's 
     legislative environmental impact statement.--The ``Final 
     Legislative Environmental Impact Statement'' (April 1987) on 
     the Coastal Plain prepared pursuant to section 1002 of the 
     Alaska National Interest Lands Conservation Act (16 U.S.C. 
     3142) and section 102(2)(C) of the National Environmental 
     Policy Act of 1969 (42 U.S.C. 4332(2)(C)) is deemed to 
     satisfy the requirements under the National Environmental

[[Page 7240]]

     Policy Act of 1969 that apply with respect to prelease 
     activities, including actions authorized to be taken by the 
     Secretary to develop and promulgate the regulations for the 
     establishment of a leasing program authorized by this title 
     before the conduct of the first lease sale.
       (3) Compliance with nepa for other actions.--Before 
     conducting the first lease sale under this title, the 
     Secretary shall prepare an environmental impact statement 
     under the National Environmental Policy Act of 1969 with 
     respect to the actions authorized by this title that are not 
     referred to in paragraph (2). Notwithstanding any other law, 
     the Secretary is not required to identify nonleasing 
     alternative courses of action or to analyze the environmental 
     effects of such courses of action. The Secretary shall only 
     identify a preferred action for such leasing and a single 
     leasing alternative, and analyze the environmental effects 
     and potential mitigation measures for those two alternatives. 
     The identification of the preferred action and related 
     analysis for the first lease sale under this title shall be 
     completed within 18 months after the date of enactment of 
     this Act. The Secretary shall only consider public comments 
     that specifically address the Secretary's preferred action 
     and that are filed within 20 days after publication of an 
     environmental analysis. Notwithstanding any other law, 
     compliance with this paragraph is deemed to satisfy all 
     requirements for the analysis and consideration of the 
     environmental effects of proposed leasing under this title.
       (d) Relationship to State and Local Authority.--Nothing in 
     this title shall be considered to expand or limit State and 
     local regulatory authority.
       (e) Special Areas.--
       (1) In general.--The Secretary, after consultation with the 
     State of Alaska, the city of Kaktovik, and the North Slope 
     Borough, may designate up to a total of 45,000 acres of the 
     Coastal Plain as a Special Area if the Secretary determines 
     that the Special Area is of such unique character and 
     interest so as to require special management and regulatory 
     protection. The Secretary shall designate as such a Special 
     Area the Sadlerochit Spring area, comprising approximately 
     4,000 acres as depicted on the map referred to in section 
     2202(1).
       (2) Management.--Each such Special Area shall be managed so 
     as to protect and preserve the area's unique and diverse 
     character including its fish, wildlife, and subsistence 
     resource values.
       (3) Exclusion from leasing or surface occupancy.--The 
     Secretary may exclude any Special Area from leasing. If the 
     Secretary leases a Special Area, or any part thereof, for 
     purposes of oil and gas exploration, development, production, 
     and related activities, there shall be no surface occupancy 
     of the lands comprising the Special Area.
       (4) Directional drilling.--Notwithstanding the other 
     provisions of this subsection, the Secretary may lease all or 
     a portion of a Special Area under terms that permit the use 
     of horizontal drilling technology from sites on leases 
     located outside the area.
       (f) Limitation on Closed Areas.--The Secretary's sole 
     authority to close lands within the Coastal Plain to oil and 
     gas leasing and to exploration, development, and production 
     is that set forth in this title.
       (g) Regulations.--
       (1) In general.--The Secretary shall prescribe such 
     regulations as may be necessary to carry out this title, 
     including rules and regulations relating to protection of the 
     fish and wildlife, their habitat, subsistence resources, and 
     environment of the Coastal Plain, by no later than 15 months 
     after the date of enactment of this Act.
       (2) Revision of regulations.--The Secretary shall 
     periodically review and, if appropriate, revise the rules and 
     regulations issued under subsection (a) to reflect any 
     significant biological, environmental, or engineering data 
     that come to the Secretary's attention.

     SEC. 2204. LEASE SALES.

       (a) In General.--Lands may be leased pursuant to this title 
     to any person qualified to obtain a lease for deposits of oil 
     and gas under the Mineral Leasing Act (30 U.S.C. 181 et 
     seq.).
       (b) Procedures.--The Secretary shall, by regulation, 
     establish procedures for--
       (1) receipt and consideration of sealed nominations for any 
     area in the Coastal Plain for inclusion in, or exclusion (as 
     provided in subsection (c)) from, a lease sale;
       (2) the holding of lease sales after such nomination 
     process; and
       (3) public notice of and comment on designation of areas to 
     be included in, or excluded from, a lease sale.
       (c) Lease Sale Bids.--Bidding for leases under this title 
     shall be by sealed competitive cash bonus bids.
       (d) Acreage Minimum in First Sale.--In the first lease sale 
     under this title, the Secretary shall offer for lease those 
     tracts the Secretary considers to have the greatest potential 
     for the discovery of hydrocarbons, taking into consideration 
     nominations received pursuant to subsection (b)(1), but in no 
     case less than 200,000 acres.
       (e) Timing of Lease Sales.--The Secretary shall--
       (1) conduct the first lease sale under this title within 22 
     months after the date of the enactment of this Act; and
       (2) conduct additional sales so long as sufficient interest 
     in development exists to warrant, in the Secretary's 
     judgment, the conduct of such sales.

     SEC. 2205. GRANT OF LEASES BY THE SECRETARY.

       (a) In General.--The Secretary may grant to the highest 
     responsible qualified bidder in a lease sale conducted 
     pursuant to section 2204 any lands to be leased on the 
     Coastal Plain upon payment by the lessee of such bonus as may 
     be accepted by the Secretary.
       (b) Subsequent Transfers.--No lease issued under this title 
     may be sold, exchanged, assigned, sublet, or otherwise 
     transferred except with the approval of the Secretary. Prior 
     to any such approval the Secretary shall consult with, and 
     give due consideration to the views of, the Attorney General.

     SEC. 2206. LEASE TERMS AND CONDITIONS.

       (a) In General.--An oil or gas lease issued pursuant to 
     this title shall--
       (1) provide for the payment of a royalty of not less than 
     12\1/2\ percent in amount or value of the production removed 
     or sold from the lease, as determined by the Secretary under 
     the regulations applicable to other Federal oil and gas 
     leases;
       (2) provide that the Secretary may close, on a seasonal 
     basis, portions of the Coastal Plain to exploratory drilling 
     activities as necessary to protect caribou calving areas and 
     other species of fish and wildlife;
       (3) require that the lessee of lands within the Coastal 
     Plain shall be fully responsible and liable for the 
     reclamation of lands within the Coastal Plain and any other 
     Federal lands that are adversely affected in connection with 
     exploration, development, production, or transportation 
     activities conducted under the lease and within the Coastal 
     Plain by the lessee or by any of the subcontractors or agents 
     of the lessee;
       (4) provide that the lessee may not delegate or convey, by 
     contract or otherwise, the reclamation responsibility and 
     liability to another person without the express written 
     approval of the Secretary;
       (5) provide that the standard of reclamation for lands 
     required to be reclaimed under this title shall be, as nearly 
     as practicable, a condition capable of supporting the uses 
     which the lands were capable of supporting prior to any 
     exploration, development, or production activities, or upon 
     application by the lessee, to a higher or better use as 
     approved by the Secretary;
       (6) contain terms and conditions relating to protection of 
     fish and wildlife, their habitat, and the environment as 
     required pursuant to section 2203(a)(2);
       (7) provide that the lessee, its agents, and its 
     contractors use best efforts to provide a fair share, as 
     determined by the level of obligation previously agreed to in 
     the 1974 agreement implementing section 29 of the Federal 
     Agreement and Grant of Right of Way for the Operation of the 
     Trans-Alaska Pipeline, of employment and contracting for 
     Alaska Natives and Alaska Native Corporations from throughout 
     the State;
       (8) prohibit the export of oil produced under the lease; 
     and
       (9) contain such other provisions as the Secretary 
     determines necessary to ensure compliance with the provisions 
     of this title and the regulations issued under this title.
       (b) Project Labor Agreements.--The Secretary, as a term and 
     condition of each lease under this title and in recognizing 
     the Government's proprietary interest in labor stability and 
     in the ability of construction labor and management to meet 
     the particular needs and conditions of projects to be 
     developed under the leases issued pursuant to this title and 
     the special concerns of the parties to such leases, shall 
     require that the lessee and its agents and contractors 
     negotiate to obtain a project labor agreement for the 
     employment of laborers and mechanics on production, 
     maintenance, and construction under the lease.

     SEC. 2207. COASTAL PLAIN ENVIRONMENTAL PROTECTION.

       (a) No Significant Adverse Effect Standard to Govern 
     Authorized Coastal Plain Activities.--The Secretary shall, 
     consistent with the requirements of section 2203, administer 
     the provisions of this title through regulations, lease 
     terms, conditions, restrictions, prohibitions, stipulations, 
     and other provisions that--
       (1) ensure the oil and gas exploration, development, and 
     production activities on the Coastal Plain will result in no 
     significant adverse effect on fish and wildlife, their 
     habitat, and the environment;
       (2) require the application of the best commercially 
     available technology for oil and gas exploration, 
     development, and production on all new exploration, 
     development, and production operations; and
       (3) ensure that the maximum amount of surface acreage 
     covered by production and support facilities, including 
     airstrips and any areas covered by gravel berms or piers for 
     support of pipelines, does not exceed 2,000 acres on the 
     Coastal Plain.
       (b) Site-Specific Assessment and Mitigation.--The Secretary 
     shall also require, with respect to any proposed drilling and 
     related activities, that--
       (1) a site-specific analysis be made of the probable 
     effects, if any, that the drilling or

[[Page 7241]]

     related activities will have on fish and wildlife, their 
     habitat, and the environment;
       (2) a plan be implemented to avoid, minimize, and mitigate 
     (in that order and to the extent practicable) any significant 
     adverse effect identified under paragraph (1); and
       (3) the development of the plan shall occur after 
     consultation with the agency or agencies having jurisdiction 
     over matters mitigated by the plan.
       (c) Regulations to Protect Coastal Plain Fish and Wildlife 
     Resources, Subsistence Users, and the Environment.--Before 
     implementing the leasing program authorized by this title, 
     the Secretary shall prepare and promulgate regulations, lease 
     terms, conditions, restrictions, prohibitions, stipulations, 
     and other measures designed to ensure that the activities 
     undertaken on the Coastal Plain under this title are 
     conducted in a manner consistent with the purposes and 
     environmental requirements of this title.
       (d) Compliance With Federal and State Environmental Laws 
     and Other Requirements.--The proposed regulations, lease 
     terms, conditions, restrictions, prohibitions, and 
     stipulations for the leasing program under this title shall 
     require compliance with all applicable provisions of Federal 
     and State environmental law and shall also require the 
     following:
       (1) Standards at least as effective as the safety and 
     environmental mitigation measures set forth in items 1 
     through 29 at pages 167 through 169 of the ``Final 
     Legislative Environmental Impact Statement'' (April 1987) on 
     the Coastal Plain.
       (2) Seasonal limitations on exploration, development, and 
     related activities, where necessary, to avoid significant 
     adverse effects during periods of concentrated fish and 
     wildlife breeding, denning, nesting, spawning, and migration.
       (3) That exploration activities, except for surface 
     geological studies, be limited to the period between 
     approximately November 1 and May 1 each year and that 
     exploration activities shall be supported, if necessary, by 
     ice roads, winter trails with adequate snow cover, ice pads, 
     ice airstrips, and air transport methods, except that such 
     exploration activities may occur at other times, if the 
     Secretary finds that such exploration will have no 
     significant adverse effect on the fish and wildlife, their 
     habitat, and the environment of the Coastal Plain.
       (4) Design safety and construction standards for all 
     pipelines and any access and service roads, that--
       (A) minimize, to the maximum extent possible, adverse 
     effects upon the passage of migratory species such as 
     caribou; and
       (B) minimize adverse effects upon the flow of surface water 
     by requiring the use of culverts, bridges, and other 
     structural devices.
       (5) Prohibitions on general public access and use on all 
     pipeline access and service roads.
       (6) Stringent reclamation and rehabilitation requirements, 
     consistent with the standards set forth in this title, 
     requiring the removal from the Coastal Plain of all oil and 
     gas development and production facilities, structures, and 
     equipment upon completion of oil and gas production 
     operations, except that the Secretary may exempt from the 
     requirements of this paragraph those facilities, structures, 
     or equipment that the Secretary determines would assist in 
     the management of the Arctic National Wildlife Refuge and 
     that are donated to the United States for that purpose.
       (7) Appropriate prohibitions or restrictions on access by 
     all modes of transportation.
       (8) Appropriate prohibitions or restrictions on sand and 
     gravel extraction.
       (9) Consolidation of facility siting.
       (10) Appropriate prohibitions or restrictions on use of 
     explosives.
       (11) Avoidance, to the extent practicable, of springs, 
     streams, and river system; the protection of natural surface 
     drainage patterns, wetlands, and riparian habitats; and the 
     regulation of methods or techniques for developing or 
     transporting adequate supplies of water for exploratory 
     drilling.
       (12) Avoidance or reduction of air traffic-related 
     disturbance to fish and wildlife.
       (13) Treatment and disposal of hazardous and toxic wastes, 
     solid wastes, reserve pit fluids, drilling muds and cuttings, 
     and domestic wastewater, including an annual waste management 
     report, a hazardous materials tracking system, and a 
     prohibition on chlorinated solvents, in accordance with 
     applicable Federal and State environmental law.
       (14) Fuel storage and oil spill contingency planning.
       (15) Research, monitoring, and reporting requirements.
       (16) Field crew environmental briefings.
       (17) Avoidance of significant adverse effects upon 
     subsistence hunting, fishing, and trapping by subsistence 
     users.
       (18) Compliance with applicable air and water quality 
     standards.
       (19) Appropriate seasonal and safety zone designations 
     around well sites, within which subsistence hunting and 
     trapping shall be limited.
       (20) Reasonable stipulations for protection of cultural and 
     archeological resources.
       (21) All other protective environmental stipulations, 
     restrictions, terms, and conditions deemed necessary by the 
     Secretary.
       (e) Considerations.--In preparing and promulgating 
     regulations, lease terms, conditions, restrictions, 
     prohibitions, and stipulations under this section, the 
     Secretary shall consider the following:
       (1) The stipulations and conditions that govern the 
     National Petroleum Reserve-Alaska leasing program, as set 
     forth in the 1999 Northeast National Petroleum Reserve-Alaska 
     Final Integrated Activity Plan/Environmental Impact 
     Statement.
       (2) The environmental protection standards that governed 
     the initial Coastal Plain seismic exploration program under 
     parts 37.31 to 37.33 of title 50, Code of Federal 
     Regulations.
       (3) The land use stipulations for exploratory drilling on 
     the KIC-ASRC private lands that are set forth in Appendix 2 
     of the August 9, 1983, agreement between Arctic Slope 
     Regional Corporation and the United States.
       (f) Facility Consolidation Planning.--
       (1) In general.--The Secretary shall, after providing for 
     public notice and comment, prepare and update periodically a 
     plan to govern, guide, and direct the siting and construction 
     of facilities for the exploration, development, production, 
     and transportation of Coastal Plain oil and gas resources.
       (2) Objectives.--The plan shall have the following 
     objectives:
       (A) Avoiding unnecessary duplication of facilities and 
     activities.
       (B) Encouraging consolidation of common facilities and 
     activities.
       (C) Locating or confining facilities and activities to 
     areas that will minimize impact on fish and wildlife, their 
     habitat, and the environment.
       (D) Utilizing existing facilities wherever practicable.
       (E) Enhancing compatibility between wildlife values and 
     development activities.
       (g) Access to Public Lands.--The Secretary shall--
       (1) manage public lands in the Coastal Plain subject to 
     subsections (a) and (b) of section 811 of the Alaska National 
     Interest Lands Conservation Act (16 U.S.C. 3121); and
       (2) ensure that local residents shall have reasonable 
     access to public lands in the Coastal Plain for traditional 
     uses.

     SEC. 2208. EXPEDITED JUDICIAL REVIEW.

       (a) Filing of Complaint.--
       (1) Deadline.--Subject to paragraph (2), any complaint 
     seeking judicial review of any provision of this title or any 
     action of the Secretary under this title shall be filed in 
     any appropriate district court of the United States--
       (A) except as provided in subparagraph (B), within the 90-
     day period beginning on the date of the action being 
     challenged; or
       (B) in the case of a complaint based solely on grounds 
     arising after such period, within 90 days after the 
     complainant knew or reasonably should have known of the 
     grounds for the complaint.
       (2) Venue.--Any complaint seeking judicial review of an 
     action of the Secretary under this title may be filed only in 
     the United States Court of Appeals for the District of 
     Columbia.
       (3) Limitation on scope of certain review.--Judicial review 
     of a Secretarial decision to conduct a lease sale under this 
     title, including the environmental analysis thereof, shall be 
     limited to whether the Secretary has complied with the terms 
     of this title and shall be based upon the administrative 
     record of that decision. The Secretary's identification of a 
     preferred course of action to enable leasing to proceed and 
     the Secretary's analysis of environmental effects under this 
     title shall be presumed to be correct unless shown otherwise 
     by clear and convincing evidence to the contrary.
       (b) Limitation on Other Review.--Actions of the Secretary 
     with respect to which review could have been obtained under 
     this section shall not be subject to judicial review in any 
     civil or criminal proceeding for enforcement.

     SEC. 2209. FEDERAL AND STATE DISTRIBUTION OF REVENUES.

       (a) In General.--Notwithstanding any other provision of 
     law, of the amount of adjusted bonus, rental, and royalty 
     revenues from oil and gas leasing and operations authorized 
     under this title--
       (1) 50 percent shall be paid to the State of Alaska; and
       (2) except as provided in section 2212(d) the balance shall 
     be deposited into the Treasury as miscellaneous receipts.
       (b) Payments to Alaska.--Payments to the State of Alaska 
     under this section shall be made semiannually.
       (c) Use of Bonus Payments for Low-Income Home Energy 
     Assistance.--Amounts that are received by the United States 
     as bonuses for leases under this title and deposited into the 
     Treasury under subsection (a)(2) may be appropriated to the 
     Secretary of the Health and Human Services, in addition to 
     amounts otherwise available, to provide assistance under the 
     Low-Income Home Energy Assistance Act of 1981 (42 U.S.C. 8621 
     et seq.).

     SEC. 2210. RIGHTS-OF-WAY ACROSS THE COASTAL PLAIN.

       (a) Exemption.--Title XI of the Alaska National Interest 
     Lands Conservation Act (16 U.S.C. 3161 et seq.) shall not 
     apply to the issuance by the Secretary under section 28 of 
     the Mineral Leasing Act (30 U.S.C. 185) of rights-of-way and 
     easements across the

[[Page 7242]]

     Coastal Plain for the transportation of oil and gas.
       (b) Terms and Conditions.--The Secretary shall include in 
     any right-of-way or easement referred to in subsection (a) 
     such terms and conditions as may be necessary to ensure that 
     transportation of oil and gas does not result in a 
     significant adverse effect on the fish and wildlife, 
     subsistence resources, their habitat, and the environment of 
     the Coastal Plain, including requirements that facilities be 
     sited or designed so as to avoid unnecessary duplication of 
     roads and pipelines.
       (c) Regulations.--The Secretary shall include in 
     regulations under section 2203(g) provisions granting rights-
     of-way and easements described in subsection (a) of this 
     section.

     SEC. 2211. CONVEYANCE.

       In order to maximize Federal revenues by removing clouds on 
     title to lands and clarifying land ownership patterns within 
     the Coastal Plain, the Secretary, notwithstanding the 
     provisions of section 1302(h)(2) of the Alaska National 
     Interest Lands Conservation Act (16 U.S.C. 3192(h)(2)), shall 
     convey--
       (1) to the Kaktovik Inupiat Corporation the surface estate 
     of the lands described in paragraph 1 of Public Land Order 
     6959, to the extent necessary to fulfill the Corporation's 
     entitlement under section 12 of the Alaska Native Claims 
     Settlement Act (43 U.S.C. 1611) in accordance with the terms 
     and conditions of the Agreement between the Department of the 
     Interior, the United States Fish and Wildlife Service, the 
     Bureau of Land Management, and the Kaktovik Inupiat 
     Corporation effective January 22, 1993; and
       (2) to the Arctic Slope Regional Corporation the remaining 
     subsurface estate to which it is entitled pursuant to the 
     August 9, 1983, agreement between the Arctic Slope Regional 
     Corporation and the United States of America.

     SEC. 2212. LOCAL GOVERNMENT IMPACT AID AND COMMUNITY SERVICE 
                   ASSISTANCE.

       (a) Financial Assistance Authorized.--
       (1) In general.--The Secretary may use amounts available 
     from the Coastal Plain Local Government Impact Aid Assistance 
     Fund established by subsection (d) to provide timely 
     financial assistance to entities that are eligible under 
     paragraph (2) and that are directly impacted by the 
     exploration for or production of oil and gas on the Coastal 
     Plain under this title.
       (2) Eligible entities.--The North Slope Borough, Kaktovik, 
     and other boroughs, municipal subdivisions, villages, and any 
     other community organized under Alaska State law shall be 
     eligible for financial assistance under this section.
       (b) Use of Assistance.--Financial assistance under this 
     section may be used only for--
       (1) planning for mitigation of the potential effects of oil 
     and gas exploration and development on environmental, social, 
     cultural, recreational and subsistence values;
       (2) implementing mitigation plans and maintaining 
     mitigation projects;
       (3) developing, carrying out, and maintaining projects and 
     programs that provide new or expanded public facilities and 
     services to address needs and problems associated with such 
     effects, including firefighting, police, water, waste 
     treatment, medivac, and medical services; and
       (4) establishment of a coordination office, by the North 
     Slope Borough, in the City of Kaktovik, which shall--
       (A) coordinate with and advise developers on local 
     conditions, impact, and history of the areas utilized for 
     development; and
       (B) provide to the Committee on Resources of the Senate and 
     the Committee on Energy and Resources of the Senate an annual 
     report on the status of coordination between developers and 
     the communities affected by development.
       (c) Application.--
       (1) In general.--Any community that is eligible for 
     assistance under this section may submit an application for 
     such assistance to the Secretary, in such form and under such 
     procedures as the Secretary may prescribe by regulation.
       (2) North slope borough communities.--A community located 
     in the North Slope Borough may apply for assistance under 
     this section either directly to the Secretary or through the 
     North Slope Borough.
       (3) Application assistance.--The Secretary shall work 
     closely with and assist the North Slope Borough and other 
     communities eligible for assistance under this section in 
     developing and submitting applications for assistance under 
     this section.
       (d) Establishment of Fund.--
       (1) In general.--There is established in the Treasury the 
     Coastal Plain Local Government Impact Aid Assistance Fund.
       (2) Use.--Amounts in the fund may be used only for 
     providing financial assistance under this section.
       (3) Deposits.--Subject to paragraph (4), there shall be 
     deposited into the fund amounts received by the United States 
     as revenues derived from rents, bonuses, and royalties under 
     on leases and lease sales authorized under this title.
       (4) Limitation on deposits.--The total amount in the fund 
     may not exceed $11,000,000.
       (5) Investment of balances.--The Secretary of the Treasury 
     shall invest amounts in the fund in interest bearing 
     government securities.
       (e) Authorization of Appropriations.--To provide financial 
     assistance under this section there is authorized to be 
     appropriated to the Secretary from the Coastal Plain Local 
     Government Impact Aid Assistance Fund $5,000,000 for each 
     fiscal year.

                  TITLE XXIII--SET AMERICA FREE (SAFE)

     SEC. 2301. SHORT TITLE.

       This title may be cited as the ``Set America Free Act of 
     2005'' or the ``SAFE Act''.

     SEC. 2302. FINDINGS.

       Congress finds the following:
       (1) The three contiguous North American countries of 
     Canada, Mexico, and the United States share many economic, 
     environmental, and security interests, including being among 
     each others' largest trading partners, similar interests in 
     clean air and clean water, concern about infiltration of 
     terrorists from nations that host terrorist organizations, 
     and interdependent economic systems.
       (2) North American energy self-sufficiency is consistent 
     with the shared interests of the three contiguous North 
     American countries and should be achieved through methods 
     that recognize and respect the sovereignty of each of the 
     three contiguous North American countries.
       (3) The Energy Information Administration (EIA), in its 
     April 2004 International Energy Outlook, projects that world 
     energy consumption will increase by 54 percent from 2001 to 
     2025 and that world oil consumption will rise from 77 million 
     barrels per day (Mmbbl/d) in 2001 to 121 Mmbbl/d in 2025.
       (4) In the same report, EIA projects that, without a change 
     in governmental policy, the United States oil consumption 
     will rise by 44.4 percent from 19.6 Mmbbl/d (7.15 billion 
     barrels per year (Bbbl/y)) in 2001 to 28.3 Mmbbl/d (10.33 
     Bbbl/y) in 2025, and that the oil consumption of the three 
     contiguous North American countries of Canada, Mexico, and 
     the United States (in this title referred to as the ``three 
     contiguous North American countries'') will rise by 47.2 
     percent from 23.5 Mmbbl/d (8.58 Bbbl/y) in 2001 (30.5 percent 
     of world consumption) to 34.6 Mmbbl/d (12.6 Bbbl/y) in 2025 
     (28.6 percent of world consumption).
       (5) EIA projects that, without a change in governmental 
     policy, oil production in the three contiguous North American 
     countries will rise by 18.8 percent from 15.4 Mmbbl/d (5.6 
     Bbbl/y) in 2001 (19.4 percent of world production) to 18.3 
     Mmbbl/d (6.7 Bbbl/y) in 2025 (14.5 percent of world 
     production).
       (6) EIA projects that, without a change in governmental 
     policy, the three contiguous North American countries contain 
     492.7 Bbbls of oil resources (16.8 percent of total world oil 
     resources) (not including unconventional oil resources such 
     as United States oil shale or the overwhelming majority of 
     Canadian oil sands) at the base case oil price, which 
     represents sufficient oil to fully supply the needs of the 
     three contiguous North American countries for 57.4 years 
     based on 2001 oil consumption and 39.1 years based on 
     projected 2025 oil consumption, resulting in an average of 
     approximately 48 years of full supply.
       (7) In the same report, EIA projects that, without a change 
     in governmental policy, the United States natural gas 
     consumption will rise by 38.9 percent from 22.6 trillion 
     cubic feet per year (Tcf/y) in 2001 to 31.4 Tcf/y in 2025, 
     and that the natural gas consumption of the three contiguous 
     North American countries will rise by 48.0 percent from 26.9 
     Tcf/y in 2001 (29.3 percent of world consumption) to 39.8 
     Tcf/y in 2025 (26.3 percent of world consumption).
       (8) EIA projects that, without a change in governmental 
     policy, natural gas production in the three contiguous North 
     American countries will rise by 21.7 percent from 27.6 Tcf/y 
     in 2001 (30.3 percent of world production) to 33.6 Tcf/y in 
     2025 (22.3 percent of world production), not including 
     Alaskan gas through the natural gas pipeline, gas from gas 
     hydrates, nor expanded coal gasification. The United States 
     Geological Survey estimates that natural gas hydrate 
     resources in-place total 169,000 Tcf in Alaska and its 
     surrounding waters, and approximately 150,000 Tcf off the 
     lower-48 Atlantic, Pacific, and Gulf of Mexico coastlines.
       (9) The terrorist attacks in the United States on September 
     11, 2001, and the subsequent expansion of terrorist 
     organizations in regions outside of North America in areas 
     that are major suppliers of oil, and potential suppliers of 
     liquified natural gas, to the United States have 
     significantly increased the national security and homeland 
     security risks to the United States of relying upon oil and 
     natural gas supply sources located outside of the three 
     contiguous North American countries. The United States 
     imports 60 percent of our oil supplies-the highest in 
     history. After Canada and Mexico, the largest oil suppliers 
     to the United States are Saudi Arabia, Venezuela, Nigeria, 
     Iraq, and Algeria all of which suffer from significant 
     instability.
       (10) According to published scientific, technical, and 
     economic reports, the three contiguous North American 
     countries have the

[[Page 7243]]

     resource base and technical ability to increase production of 
     oil by at least 15 Mmbbl/d by 2025 and 20 Mmbbl/d by 2030 
     even before increases in coal liquifaction, biofuels, gas-to-
     liquids, and other methods of creating liquid substitutes for 
     crude oil and crude oil products.
       (11) This increase in North American oil production would 
     be derived from a variety of resources including, among 
     others--
       (A) the United States oil shale resource base (2 trillion 
     barrels of oil in place out of 2.6 trillion in the world) 
     believed to be capable of eventually producing 10 Mmbbl/d for 
     more than 100 years;
       (B) the Canadian Alberta oil sands resource base (1.7 
     trillion barrels of oil in place), also believed to be 
     capable of eventually producing 10 Mmbbl/d for more than 100 
     years;
       (C) the United States heavy oil resource base (80 billion 
     barrels of oil in place);
       (D) the remaining 400 billion barrels of conventional oil 
     in place in the United States of which 60 billion barrels are 
     potentially producible with advanced CO2 enhanced oil 
     recovery technology;
       (E) the United States oil sands resource base of 54 billion 
     barrels of oil in place;
       (F) the Arctic National Wildlife Refuge Coastal Plain area 
     (ANWR) with a mean technically recoverable resource of more 
     than 10 billion barrels of oil;
       (G) the National Petroleum Reserve-Alaska (NPR-A) with a 
     mean technically recoverable resource of 9.3 billion barrels 
     of oil;
       (H) the 12-18 billion barrels of oil likely to be 
     producible in the Canadian Atlantic offshore;
       (I) the extensive resources of the Canadian Arctic onshore 
     and offshore;
       (J) the extensive resources in the Alaskan Arctic offshore 
     and the outer Continental Shelf offshore the lower-48 United 
     States;
       (K) other extensive oil resources in Canada and the United 
     States; and
       (L) the extensive oil resources of Mexico.
       (12) In addition to being the ``Saudi Arabia'' of oil shale 
     with at least 75 percent of the world's oil shale resource 
     base, the United States is also the ``Saudi Arabia'' of coal. 
     The EIA estimates that total economically recoverable 
     reserves of coal around the world are 1,083 billion short 
     tons-enough to last approximately 210 years at current 
     consumption levels. EIA estimates that the economically 
     recoverable coal reserves of the United States, at 25 percent 
     of total world reserves, are the largest in the world. Total 
     United States coal resources are vastly larger than the 270 
     billion short tons of economically recoverable reserves, and 
     with new technology much more could economically be made 
     available to supply our energy needs. World consumption of 
     coal in 2001 was 5.26 billion short tons and is projected to 
     grow to 7.57 billion short tons in 2025. 70 percent of the 
     increased world consumption is projected to be attributable 
     to China and India. United States consumption of coal in 2001 
     was 1.06 billion short tons and is projected to grow to 1.57 
     billion short tons in 2025.
       (13) Growth in world oil consumption has been outstripping 
     growth in world production of conventional oil resources for 
     several primary reasons, including that conventional oil 
     production in most oil producing countries has peaked and is 
     now declining, and developing nations such as China and India 
     are greatly accelerating their consumption of crude oil.
       (14) The recent increases in world oil prices are caused by 
     the faster growth in demand over supply and this trend is 
     likely to continue because the remaining conventional oil is 
     more difficult and expensive to find and produce, and 
     frequently not reasonably available.
       (15) The National Intelligence Council, an advisor to the 
     Central Intelligence Agency, found in its report, ``Mapping 
     the Global Future,'' NIC 2004-13, December 2004, that 
     ``Continued limited access of the international oil companies 
     to major fields could restrain this investment necessary for 
     supply to meet demand, however, and many of the areas--the 
     Caspian Sea, Venezuela, West Africa, and South China Sea--
     that are being counted on to provide increased output involve 
     substantial political or economic risk. Traditional suppliers 
     in the Middle East are also increasingly unstable. Thus 
     sharper demand-driven competition for resources, perhaps 
     accompanied by a major disruption of oil supplies, is among 
     the key uncertainties. China and India, which lack adequate 
     domestic energy resources, will have to ensure continued 
     access to outside suppliers; thus, the need for energy will 
     be a major factor in shaping their foreign and defense 
     policies, including expanding naval power''.
       (16) Because the price of crude oil is set on a world 
     market basis, the excess of world demand over supply will 
     continue to drive up oil prices to levels potentially several 
     times those of today unless all nations capable of producing 
     significant quantities of incremental oil respond by ensuring 
     such production is developed and available for consumption on 
     an expedited basis.
       (17) The eventual, long-term solution is to drastically 
     reduce the world's reliance on oil as the primary fuel for 
     transportation (40 percent of the United States consumption 
     of oil is to power light motor vehicles).
       (18) North America, while maximizing the production of oil, 
     must use the next 40 years as a transition period to a more 
     sustainable energy model.
       (19) The United States also has large renewable energy 
     resource potential including wind, geothermal, solar, 
     biomass, ocean thermal, waves and currents, and 
     hydroelectric. The EIA's July 2004 report, ``Renewable Energy 
     Trends 2003'', found that renewable energy provided 6 percent 
     of the Nation's energy supply in 2003. The largest renewable 
     energy source was biomass with 47 percent of the renewables 
     total energy output, followed closely by hydroelectric with 
     45 percent, then geothermal with 5 percent, wind with 2 
     percent, and solar with 1 percent. Technology is rapidly 
     advancing, positioning renewable energy to provide an 
     increasing share of our energy supply in the residential, 
     commercial, industrial, transportation, and electric power 
     sectors. The United States public lands and waters comprise 
     2.25 billion acres, large portions of which may be available 
     to rapidly expand this clean and renewable alternative to 
     fossil energy resources. These lands should be reviewed for 
     their potential contribution to our Nation's domestic energy 
     security.
       (20) The United States has the strongest environmental 
     safeguards in the world, and our standards, science, and 
     technology have proven that the United States can produce 
     energy in an environmentally benign manner, particularly when 
     compared with the lesser environmental standards in most 
     foreign oil producing countries.
       (21) The 1999 Clinton Administration report, 
     ``Environmental Benefits of Advanced Oil and Gas Exploration 
     and Production Technology,'' highlights the technological 
     achievements of the United States oil and gas industry. The 
     report noted, ``public awareness of the significant and 
     impressive environmental benefits from new exploration and 
     production (E&P) technology advances remains limited. . . . 
     We believe it is important to tell this remarkable story of 
     environmental progress in E&P technology. Greater awareness 
     of the industry's achievements in environmental protection 
     will provide the context for effective policy, and for 
     informed decision making by both the private and public 
     sectors.''.
       (22) Many Americans believe the myth that spills from oil 
     and natural gas exploration and production are the leading 
     cause of oil pollution in the oceans and the Nation's rivers 
     and streams. The reality is that, to the contrary, in 2002 
     the National Academy of Sciences found that offshore oil and 
     natural gas exploration and production account for a total of 
     only 2 percent of the oil in the North American marine 
     environment; natural sources such as oil seeps account for 63 
     percent of such oil; industrial and municipal discharges, 
     including urban runoff, account for 22 percent of such oil; 
     atmospheric pollution accounts for 8 percent of such oil; 
     marine transportation accounts for 3 percent of such oil; and 
     recreational vessels account for 2 percent of such oil.
       (23) Various national security organizations and experts 
     have warned the United States of the escalating risks to our 
     national security of relying on transoceanic oil imports from 
     unstable regions of the world for a significant part of our 
     oil supplies, and they have urged the Nation to reduce its 
     dependence on oil.
       (24) Polls consistently have found that a majority of 
     individuals in the United States strongly support reducing 
     our reliance on foreign energy sources.
       (25) A recent report on ``Energy and National Security'' 
     issued by Sandia National Laboratories, SAND2003-3287, 
     September 2003, found that our national security is 
     threatened by our continued reliance on vast quantities of 
     oil from unstable foreign sources. The report found that 
     supply disruptions, caused by terrorists or otherwise, could 
     immediately remove many millions of barrels of oil per day 
     from the world supply, and noted that the EIA has estimated 
     that for every one million bbl/d of oil supply disrupted, 
     world oil prices might increase $3-$5 per barrel. Sandia 
     found six solution options, including--
       (A) maintenance of strategic reserves;
       (B) support of foreign government regimes likely to 
     maintain production;
       (C) military deterrence, protection, or intervention to 
     secure production sources and facilities;
       (D) diversification of production sources;
       (E) reduction of oil intensity through conservation or 
     through more efficient energy use; and
       (F) development and deployment of alternatives to oil (or 
     gas).
     Sandia noted ``that none of these measures seems likely to 
     emerge from business-as-usual market processes. Thus 
     implementation of these measures will usually require public 
     policy decisions. In the case of the first three, they would 
     be foreign and military policy decisions; in the case of the 
     latter three, they would be legal, regulatory, or 
     governmental subsidy decisions.'' Sandia mentioned oil shale 
     and tar sands as potential diversified sources of oil 
     supplies, and hydrogen, coal, renewables, nuclear fission, 
     and methane hydrates as alternatives to oil.
       (26) President Clinton concluded, on February 16, 1995, 
     under section 232 of the Trade Expansion Act of 1962, that 
     ``. . . the nation's

[[Page 7244]]

     growing reliance on imports of crude oil and refined 
     petroleum products threaten the nation's security because 
     they increase U.S. vulnerability to oil supply 
     interruptions.''. In 1994 crude oil imports were 7.051 
     million barrels per day. On March 24, 2000, President 
     Clinton, upon further review under section 232, found, ``I 
     have reviewed and approved the findings of your investigative 
     report . . . that imports of crude oil threaten to impair the 
     national security.''. Between the two statements by President 
     Clinton, United States crude oil imports increased 21.6 
     percent to 8.581 million barrels per day in 1999.
       (27) Economists have found that while OPEC is an important 
     source of oil price increases, the United States government 
     is also partly to blame because overly burdensome government 
     regulations on domestic energy exploration, production, and 
     sales have supported OPEC's monopoly power and restricted 
     competition from American energy companies, in addition to 
     making expansive highly prospective areas off-limits to 
     leasing and production.
       (28) In addition to jeopardizing our national and energy 
     security, importing the majority of our oil also injures our 
     economic security. The United States imported approximately 
     4.7 billion barrels of oil in 2004, of which 1.4 billion 
     barrels were from Canada and Mexico. Imported energy creates 
     very few jobs in the United States and makes only a very 
     minor contribution to our Gross Domestic Product (GDP). If we 
     substitute North American production for the remaining 3.3 
     billion barrels of imports per year, at $40 per barrel the 
     new production would sell for $132 billion. A widely used 
     commercial economics model projects that GDP would increase 
     by $336 billion, creating 1,667,160 jobs, each with an 
     average total annual compensation of $50,356. Further, such 
     activity is projected to generate approximately $22 billion 
     in indirect business taxes, including sales, excise, and 
     severance taxes. At a one-eighth royalty, total royalty 
     payments to mineral rights owners would approximate $16.5 
     billion per year. Further, our imported energy represents 
     more than 25 percent of our international trade deficit. 
     American production could eliminate two-thirds of the 25 
     percent, strengthening our economy.

     SEC. 2303. PURPOSE.

       The purpose of this title 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. 2304. 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 
     title 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) 4 members shall be appointed from amongst individuals 
     independently determined by the President to be qualified for 
     appointment.
       (B) 4 members shall be appointed from a list of 8 
     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) 4 members shall be appointed from a list of 8 
     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) 2 members shall be appointed from a list of 4 
     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) 2 members shall be appointed from a list of 4 
     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. 2305. NORTH AMERICAN ENERGY FREEDOM POLICY.

       Within 90 days after receiving and considering the report 
     and recommendations of the Commission under section 2304, 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 XXV--GRAND CANYON HYDROGEN-POWERED TRANSPORTATION DEMONSTRATION

     SEC. 2501. SHORT TITLE.

       This title may be cited as the ``Grand Canyon Hydrogen-
     Powered Transportation Demonstration Act of 2005''.

     SEC. 2502. DEFINITIONS.

       For purposes of this title, the term--

[[Page 7245]]

       (1) ``Departments'' means the Department of Energy jointly 
     with the Department of the Interior; and
       (2) ``Secretaries'' means the Secretary of Energy jointly 
     with the Secretary of the Interior.

     SEC. 2503. FINDINGS.

       The Congress finds that--
       (1) there is a need for a research and development program 
     to support and foster the development, demonstration, and 
     deployment of emerging hydrogen-based transportation 
     technologies suitable for use in sensitive resource areas;
       (2) partnerships between the Department of Energy, the 
     Department of the Interior, Native American Tribes, and 
     United States industry to develop hydrogen-based energy 
     technologies can provide significant benefits to our Nation, 
     including enhancing our environmental stewardship, reducing 
     our dependence on foreign oil, increasing our energy 
     security, as well as creating jobs for United States workers 
     and improving the competitive position of the United States 
     in the global economy; and
       (3) when technologically and economically feasible, the 
     implementation of clean, silent or nearly silent, hydrogen-
     based transportation technologies would further resource 
     stewardship and experiential goals in sensitive resource 
     areas including units of the National Park System, such as 
     Grand Canyon National Park.

     SEC. 2504. RESEARCH, DEVELOPMENT, AND DEMONSTRATION PROGRAM.

       (a) In General.--The Secretaries shall jointly establish 
     and carry out a research and development program, in 
     partnership with the private sector, relating to hydrogen-
     based transportation technologies suitable for operations in 
     sensitive resource areas such as national parks. The 
     Secretaries, in partnership with the private sector, shall 
     conduct a demonstration of hydrogen-based public 
     transportation technology at Grand Canyon National Park 
     within three years after the date of enactment of this Act. 
     At his discretion, the Secretary of Energy may choose to 
     extend existing Department of Energy hydrogen-related vehicle 
     research and development programs in order to meet the 
     objectives and requirements of this title. The Secretaries 
     shall provide preference to tribal entities in the 
     establishment of the research and development program.
       (b) Objective.--The objective of the program shall be to 
     research, develop, and demonstrate, in cooperation with 
     affected and related industries, a hydrogen-based alternative 
     public transportation system suitable for operations within 
     Grand Canyon National Park, that meets the following 
     standards:
       (1) Silent or near-silent operation.
       (2) Low, ultra low, or zero emission of pollutants.
       (3) Reliability.
       (4) Safe conveyance of passengers and operator.
       (c) Partnership.--In order to accomplish the objective set 
     forth in subsection (b), the Secretaries shall establish a 
     partnership among the Departments, manufacturers, other 
     affected or related industries, Native American Tribes, and 
     the National Park Service shuttle operators and tour 
     operators authorized to provide services in Grand Canyon 
     National Park.

     SEC. 2505. REPORTS TO CONGRESS.

       One year after the date of enactment of this Act, and 
     annually thereafter for the duration of the program, the 
     Secretaries shall submit a report to the Committees on 
     Appropriations, Resources, and Energy and Commerce of the 
     House of Representatives and the Committees on Appropriations 
     and Energy and Natural Resources of the Senate describing the 
     ongoing activities of the Secretaries and the Departments 
     relating to the program authorized under this title and, to 
     the extent practicable, the activities planned for the coming 
     fiscal year.

     SEC. 2506. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated to the Secretaries 
     to carry out this title, in addition to any amounts made 
     available for these or related purposes under other Acts, 
     $400,000 per year for three consecutive fiscal years 
     beginning with the full fiscal year following the date of 
     enactment of this Act.

                   TITLE XXVI--ADDITIONAL PROVISIONS

     SEC. 2601. LIMITATION ON REQUIRED REVIEW UNDER NEPA.

       (a) Limitation on Review.--Action by the Secretary of the 
     Interior in managing the public lands with respect to any of 
     the activities described in subsection (b) shall not be 
     subject to review under section 102(2)(C) the National 
     Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)), if 
     the activity is conducted for the purpose of exploration or 
     development of a domestic Federal energy source.
       (b) Activities Described.--The activities referred to in 
     subsection (a) are the following:
       (1) Geophysical exploration that does not require road 
     building.
       (2) Individual surface disturbances of less than 5 acres.
       (3) Drilling an oil or gas well at a location or well pad 
     site at which drilling has occurred previously.
       (4) Drilling an oil or gas well within a developed field 
     for which an approved land use plan or any environmental 
     document prepared pursuant to the National Environmental 
     Policy Act of 1969 analyzed such drilling as a reasonably 
     foreseeable activity.
       (5) Disposal of water produced from an oil or gas well, if 
     the disposal is in compliance with a permit issued under the 
     Federal Water Pollution Control Act.
       (6) Placement of a pipeline in an approved right-of-way 
     corridor.
       (7) Maintenance of a minor activity, other than any 
     construction or major renovation of a building or facility.

     SEC. 2602. 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.

  The CHAIRMAN. No amendment to the bill shall be in order except those 
printed in House Report 109-49.
  Each amendment may be offered only in the order printed in the 
report, by a Member designated in the report, shall be considered read, 
shall be debatable for the time specified in the report, equally 
divided and controlled by the proponent and an opponent, shall not be 
subject to amendment except as specified in the report, and shall not 
be subject to a demand for division of the question.
  It is now in order to consider amendment No. 1 printed in House 
Report 109-49.


                  Amendment No. 1 Offered by Mr. Hall

  Mr. HALL. Madam Chairman, I rise as the designee of the chairman and 
I offer amendment No. 1.
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 1 Offered by Mr. Hall:
       In the item in the table of contents relating to section 
     142, strike ``cdbg'' and insert ``CDBG''.
       In section 105(a)(1), strike ``Section 801(a)'' and insert 
     ``Section 801(a)(2)''.
       In section 105(a)(1), strike ``(42 U.S.C. 8287(a))'' and 
     insert ``(42 U.S.C. 8287(a)(2))''.
       In section 105(a)(1), in the proposed subparagraph (E), 
     insert ``and report to the Office of Management and Budget'' 
     after ``shall meet monthly''.
       In section 105(a)(1), in the proposed subparagraph (E), 
     insert ``No Federal agency shall enter into a contract under 
     this title unless the Office of Management and Budget has 
     approved such contract.'' after ``contracts are not 
     exceeded.''.
       In section 105, strike subsections (c), (d), (e), (f), and 
     (g), and redesignate subsection (h) as subsection (c).
       In section 133(b), in the proposed subsection (f), strike 
     ``for suspended ceiling fans,''; and strike the last 
     sentence.
       In section 133(c), in the proposed subsection (v), strike 
     ``Suspended Ceiling Fans, Vending Machines,'' and insert 
     ``Vending Machines'' in the subsection heading.
       In section 133(c), in the proposed subsection (v), strike 
     ``suspended ceiling fans, refrigerated bottled or canned 
     beverage vending machines,'' and insert ``refrigerated 
     bottled or canned beverage vending machines''.
       In section 136, strike ``Section 327'' and insert 
     ``Effective 3 years after the date of enactment of this Act, 
     section 327''.
       In section 136, redesignate the proposed subsection (h) as 
     subsection (i).
       In section 136, in the proposed subsection (i)(1) (as so 
     redesignated by the preceding amendment), strike ``or 
     revised'' both places it appears.
       In section 148 of the bill, strike subparagraph (B) of 
     paragraph (1) and insert the following:
       (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')'';
       In section 148 of the bill, strike subparagraph (B) of 
     paragraph (2) and all that follows through the end of 
     paragraph (3) and insert the following:

[[Page 7246]]

       (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''.
       In section 205(a), in the proposed section 570(a)(1), 
     strike ``Secretary'' and insert ``Administrator of General 
     Services''.
       In section 205(a), in the proposed section 570(a)(4), 
     strike ``Secretary'' and insert ``Administrator''.
       In section 205(a), in the proposed section 570(b)(1), 
     strike ``Secretary'' and insert ``Administrator''.
       In section 205(a), in the proposed section 570(b)(2), 
     strike ``Secretary'' and insert ``Administrator''.
       In section 205(a), strike ``Part 4 of title V of the 
     National Energy Conservation Policy Act (42 U.S.C. 8271 et 
     seq.)'' and insert ``Subchapter VI of chapter 31 of title 40, 
     United States Code,''.
       In section 205(a), at the beginning of the quoted material, 
     strike ``sec. 570.'' and insert ``Sec. 3177.''.
       Strike section 206 (and amend the table of contents 
     accordingly).
       Strike section 244 (and amend the table of contents 
     accordingly).
       Strike section 245 (and amend the table of contents 
     accordingly).
       In title III, after section 330, insert the following new 
     section (and amend the table of contents accordingly):

     SEC. 332. NATURAL GAS MARKET REFORM.

       (a) Clarification of Existing CFTC Authority.--
       (1) False reporting.--Section 9(a)(2) of the Commodity 
     Exchange Act (7 U.S.C. 13(a)(2)) is amended by striking 
     ``false or misleading or knowingly inaccurate reports'' and 
     inserting ``knowingly false or knowingly misleading or 
     knowingly inaccurate reports''.
       (2) Commission administrative and civil authority.--Section 
     9 of the Commodity Exchange Act (7 U.S.C. 13) is amended by 
     redesignating subsection (f) as subsection (e), and adding:
       ``(f) Commission Administrative and Civil Authority.--The 
     Commission may bring administrative or civil actions as 
     provided in this Act against any person for a violation of 
     any provision of this section including, but not limited to, 
     false reporting under subsection (a)(2).''.
       (3) Effect of amendments.--The amendments made by 
     paragraphs (1) and (2) restate, without substantive change, 
     existing burden of proof provisions and existing Commission 
     civil enforcement authority, respectively. These clarifying 
     changes do not alter any existing burden of proof or grant 
     any new statutory authority. The provisions of this section, 
     as restated herein, continue to apply to any action pending 
     on or commenced after the date of enactment of this Act for 
     any act, omission, or violation occurring before, on, or 
     after, such date of enactment.
       (b) Fraud Authority.--Section 4b of the Commodity Exchange 
     Act (7 U.S.C. 6b) is amended--
       (1) by redesignating subsections (b) and (c) as subsections 
     (c) and (d), respectively; and
       (2) by striking subsection (a) and inserting the following:
       ``(a) It shall be unlawful--
       ``(1) for any person, in or in connection with any order to 
     make, or the making of, any contract of sale of any commodity 
     for future delivery or in interstate commerce, that is made, 
     or to be made, on or subject to the rules of a designated 
     contract market, for or on behalf of any other person; or
       ``(2) for any person, in or in connection with any order to 
     make, or the making of, any contract of sale of any commodity 
     for future delivery, or other agreement, contract, or 
     transaction subject to section 5a(g) (1) and (2) of this Act, 
     that is made, or to be made, for or on behalf of, or with, 
     any other person, other than on or subject to the rules of a 
     designated contract market--
       ``(A) to cheat or defraud or attempt to cheat or defraud 
     such other person;
       ``(B) willfully to make or cause to be made to such other 
     person any false report or statement or willfully to enter or 
     cause to be entered for such other person any false record;
       ``(C) willfully to deceive or attempt to deceive such other 
     person by any means whatsoever in regard to any order or 
     contract or the disposition or execution of any order or 
     contract, or in regard to any act of agency performed, with 
     respect to any order or contract for or, in the case of 
     subsection (a)(2), with such other person; or
       ``(D)(i) to bucket an order if such order is either 
     represented by such person as an order to be executed, or 
     required to be executed, on or subject to the rules of a 
     designated contract market; or
       ``(ii) to fill an order by offset against the order or 
     orders of any other person, or willfully and knowingly and 
     without the prior consent of such other person to become the 
     buyer in respect to any selling order of such other person, 
     or become the seller in respect to any buying order of such 
     other person, if such order is either represented by such 
     person as an order to be executed, or required to be 
     executed, on or subject to the rules of a designated contract 
     market.
       ``(b) Subsection (a)(2) shall not obligate any person, in 
     connection with a transaction in a contract of sale of a 
     commodity for future delivery, or other agreement, contract 
     or transaction subject to section 5a(g) (1) and (2) of this 
     Act, with another person, to disclose to such other person 
     nonpublic information that may be material to the market 
     price of such commodity or transaction, except as necessary 
     to make any statement made to such other person in connection 
     with such transaction, not misleading in any material 
     respect.''.
       (c) Jurisdiction of the CFTC.--The Natural Gas Act (15 
     U.S.C. 717 et seq.) is amended by adding at the end:

     ``SEC. 26. JURISDICTION.

       ``This Act shall not affect the exclusive jurisdiction of 
     the Commodity Futures Trading Commission with respect to 
     accounts, agreements, contracts, or transactions in 
     commodities under the Commodity Exchange Act (7 U.S.C. 1 et 
     seq.). Any request for information by the Commission to a 
     designated contract market, registered derivatives 
     transaction execution facility, board of trade, exchange, or 
     market involving accounts, agreements, contracts, or 
     transactions in commodities (including natural gas, 
     electricity, and other energy commodities) within the 
     exclusive jurisdiction of the Commodity Futures Trading 
     Commission shall be directed to the Commodity Futures Trading 
     Commission, which shall cooperate in responding to any 
     information request by the Commission.''.
       (d) Increased Penalties.--Section 21 of the Natural Gas Act 
     (15 U.S.C. 717t) 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''; 
     and
       (2) in subsection (b), by striking ``$500'' and inserting 
     ``$50,000''.
       In section 441(a), in the proposed section 3105(b)(1), 
     insert ``or equal to'' after ``projects less than''.
       In section 640, strike ``Section 3110'' and insert 
     ``Section 3110(a)''.
       In section 640, in the proposed paragraph (8), strike ``Not 
     later than'' and insert ``To the extent appropriations are 
     provided in advance for this purpose or are otherwise 
     available, not later than''.
       In section 663, at the beginning of the quoted material, 
     strike ``(z)'' and insert ``z.''.
       In section 663, in the proposed subsection z.(1), strike 
     ``section 922(o), (v), and (w)'' and insert ``section 
     922(a)(4) and (o)''.
       In section 663, in the proposed subsection z.(2)(A), strike 
     ``, (o), (v), and (w)'' and insert ``and (o)''.
       In section 722(b)(1)(B), strike ``, scooters,''.
       In title VII, amend section 753 to read as follows:

     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.
       (d) Risk Assessments.--Any assessment of risk to human 
     health and the environment

[[Page 7247]]

     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.
       In title VII, amend section 756 to read as follows:

     SEC. 756. REDUCTION OF ENGINE IDLING OF HEAVY-DUTY VEHICLES.

       (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 device or system of 
     devices that--
       (A) is used to reduce long-duration idling of a heavy-duty 
     vehicle; and
       (B) allows for the main drive engine or auxiliary 
     refrigeration engine of a heavy-duty vehicle 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 of a 
     heavy-duty vehicle.
       (7) Long-duration idling.--
       (A) In general.--The term ``long-duration idling'' means 
     the operation of a main drive engine or auxiliary 
     refrigeration engine of a heavy-duty vehicle, 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 of a heavy-duty vehicle 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) $19,500,000 for fiscal year 2006, 
     $30,000,000 for fiscal year 2007, and $45,000,000 for fiscal 
     year 2008.
       (ii) Cost sharing.--Subject to clause (iii), 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.
       (iii) Necessary and appropriate reductions.--The 
     Administrator may reduce the non-Federal requirement under 
     clause (ii) if the Administrator determines that the 
     reduction is necessary and appropriate to meet the objectives 
     of this section.
       (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.
       In title VIII, after section 810, insert the following and 
     make the necessary conforming changes in the table of 
     contents:

     SEC. 811. HYDROGEN FUEL CELL BUSES.

       The Secretary of Energy, through the advanced vehicle 
     technologies program, in coordination with the Secretary of 
     Transportation, shall advance the development of fuel cell 
     bus technologies by providing funding for 4 demonstration 
     sites that--
       (1) have or will soon have hydrogen infrastructure for fuel 
     cell bus operation; and
       (2) are operated by entities with experience in the 
     development of fuel cell bus technologies, to enable the 
     widespread utilization of fuel cell buses.

     Such demonstrations shall address the reliability of fuel 
     cell heavy-duty vehicles, expense, infrastructure, 
     containment, storage, safety, training, and other issues.
       In title IX, subtitle F, chapter 1, add at the end the 
     following new sections:

     SEC. 968A. 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

[[Page 7248]]

     the date of enactment of this section and shall not impose 
     any requirement or sanction that might otherwise apply during 
     the pendency of the demonstration project.

     SEC. 968B. WESTERN HEMISPHERE ENERGY COOPERATION.

       (a) Program.--The Secretary shall carry out a program to 
     promote cooperation on energy issues with Western Hemisphere 
     countries.
       (b) Activities.--Under the program, the Secretary shall 
     fund activities to work with Western Hemisphere countries 
     to--
       (1) assist the countries in formulating and adopting 
     changes in economic policies and other policies to--
       (A) increase the production of energy supplies; and
       (B) improve energy efficiency; and
       (2) assist in the development and transfer of energy supply 
     and efficiency technologies that would have a beneficial 
     impact on world energy markets.
       (c) University Participation.--To the extent practicable, 
     the Secretary shall carry out the program under this section 
     with the participation of universities so as to take 
     advantage of the acceptance of universities by Western 
     Hemisphere countries 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 
     universities that involve the participation of minority 
     students, such as Hispanic-serving institutions and 
     Historically Black Colleges and Universities.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section--
       (1) $8,000,000 for fiscal year 2006;
       (2) $10,000,000 for fiscal year 2007;
       (3) $13,000,000 for fiscal year 2008;
       (4) $16,000,000 for fiscal year 2009; and
       (5) $19,000,000 for fiscal year 2010.

     SEC. 968C. ARCTIC ENGINEERING RESEARCH CENTER.

       (a) In General.--The Secretary of Energy (referred to in 
     this section as the ``Secretary'') in consultation with the 
     Secretary of Transportation 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 possible;
       (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. 968D. 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.
       In section 970(d), amend paragraph (3) to read as follows:
       (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.
       In section 1236, adding a new section 217 to the Federal 
     Power Act, insert a period before the final closing quotation 
     marks.
       In section 1252(a) and in section 1252(b), strike ``Public 
     Utilities'' and insert ``Public Utility''.
       In section 1254(b)(1), in the amendment to section 112(b) 
     of the Public Utility Regulatory Policies Act of 1978, strike 
     ``(3)(A)'' and insert ``(5)(A)''.
       In section 1254(b)(2), strike ``112(d) f'' and insert 
     ``112(d) of''.
       In title XII, in section 1274(a), after ``for'' strike 
     ``section'' and insert ``sections 1269 (relating to effect on 
     other regulations), 1270 (relating to enforcement), 1271 
     (relating to savings provisions), and''.
       In title XII, amend section 1298 to read as follows:

     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 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.''.
       In section 1443, in the amendment adding subsection (d) to 
     section 181 of the Clean Air Act, in paragraph (4), strike 
     ``If, no more than 18 months prior to the date of enactment 
     of this subsection'' and insert ``If, after April 1, 2003'' 
     and strike ``within 12 months after the date of enactment of 
     this subsection''.
        In title XIV, in section 1446, strike ``as defined under 
     section 2(a)(1)(A)'' and insert ``identified under section 
     2(a)(1)(B)'' and strike ``2720(a)(1)(A)'' and insert 
     ``2720(a)(1)(B)''.
       In title XV, in section 1505(a), strike ``The review shall 
     be completed no later than May 31, 2014'' and insert ``The 
     review shall commence after May 31, 2013, and shall be 
     completed no later than May 31, 2014''.
       In section 1505(b), strike ``No later'' and insert ``After 
     completion of the review under subsection (a) and no later''.
       In section 1510, in subparagraph (G) of subsection (a)(2), 
     after ``vehicle emission systems,'' insert ``on-road and off-
     road diesel rules,'' and after ``imposed by'' insert ``the 
     Federal Government,''.
       In section 1510(b)(1), strike ``2007'' and insert ``2009''.
       In title XV, in section 1530, in subsection (a) adding a 
     new subsection (i) to section 9003 of the Solid Waste 
     Disposal Act, strike subparagraph (G) of paragraph (1) of 
     such new subsection (i) and insert a period at the end of 
     subsection (b).
       In title XV, in section 1531, in the amendment adding new 
     section 9014 to the Solid Waste Disposal Act, in paragraph 
     (2)(C) strike ``9004(f)'' and insert ``9003(i), 9004(f),'' 
     and in paragraph (2)(D) strike ``9011 and 9012'' and insert 
     ``9010, 9011, 9012, and 9013''.
       In section 1541(c)(2), strike ``preserves air quality 
     standards'' and insert ``addresses air quality 
     requirements''.
       In section 1541(c)(2), strike ``that results'' and insert 
     ``including that which has resulted''.
       In section 1541(c), insert the following new paragraph 
     after paragraph (2) and redesignate the following paragraphs 
     accordingly:

[[Page 7249]]

       (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 and shall endeavor to avoid duplication of effort with 
     regard to such studies.
       In section 1541(c)(4) (as redesignated by the preceding 
     amendment), strike the sentence beginning with ``The 
     Administrator shall use sound''.
       In the heading of title XVII, insert ``--RESOURCES'' at the 
     end (and amend the table of contents accordingly).
       In the heading of title XIX, insert ``--RESOURCES'' at the 
     end (and amend the table of contents accordingly).
       Strike section 2026 (and amend the table of contents 
     accordingly).
       In the heading of title XXI, insert ``--RESOURCES'' at the 
     end (and amend the table of contents accordingly).
       Redesignate title XXV as title XXIV, and redesignate 
     sections 2501 through 2506 as sections 2401 through 2406, 
     respectively (and amend the table of contents accordingly).
       Redesignate section 2601 as section 2055, and move it to 
     the end of subtitle D of title XX.
       Redesignate section 2602 as section 112, and move it to the 
     end of subtitle A of title I.
       Strike the remainder of title XXVI.

  The CHAIRMAN. Pursuant to House Resolution 219, the gentleman from 
Texas (Mr. Hall) and a Member opposed each will control 5 minutes.
  The Chair recognizes the gentleman from Texas (Mr. Hall).
  Mr. HALL. Madam Chairman, I yield myself such time as I may consume.
  Madam Chairman, I offer a manager's amendment which sets forth 
clearly all of the changes we are proposing to make in our 
comprehensive energy bill. We have listed all of the changes, rather 
than offer a substitute, so all Members know which provisions we are 
changing. Our summary clearly explains these changes.
  Madam Chairman, this amendment makes some technical changes, adds a 
few provisions which were part of the H.R. 6 conference report from 
last Congress, and clarifies some of the provisions contained in this 
year's bill. None of these provisions should be controversial.
  We make technical changes in the ceiling fan efficiency standards. We 
clarify references to the firearm laws in the nuclear security 
provision, which had referred to a law no longer in existence. We 
clarified the tax status of the consortium under the ultradeep program. 
And we made clear the PUHCA provisions would not impair FERC's or State 
commissions' ability to enforce provisions and that companies still 
must comply with existing orders during the period repeal becomes 
effective.
  We clarify dates in the NAS MTBE study, rulemaking and appropriation 
authorization dates for the LUST program, and clarified the bump-up 
dates. We allowed our clean air coal projects to be eligible to power 
plants of 600 MW or less. We made technical changes to the boutique 
fuels studies and our reference to the soybean oil within the Edible 
Oil Act. We have also included the on road and off-road diesel rules in 
the fuel harmonization study. We also clarified that FERC would have a 
role to play with the regional boards we established to set guidelines 
for efficient, economic dispatch of electric power.
  Madam Chairman, we again try to cap the energy savings performance 
contracts at $500 million. We disagree these provisions should score. 
Like many, we have voiced our opposition to this score, but we are 
concerned about the cost of the bill, so we are trying again to cap its 
cost. We also tried to avoid a $64 million score on our employee 
benefits amendment we adopted in committee.
  Some of our other changes include clarifying that the 3-year time 
period in which the Federal Government must establish energy efficiency 
standards on certain products be prospective only. Like we did in the 
bill of the last Congress, we moved the photovoltaic program from DOE 
to GSA.
  We added back into the bill some of the provisions contained in our 
H.R. 6 conference report of the last Congress. Several were in the 
research and development title and include the Western Michigan 
Demonstration Project, the Western Hemisphere Energy Cooperation 
Project, the Arctic Engineering Research Center, and the Barrow 
Geophysical Research Facility.
  Madam Chairman, most importantly, we reinserted the natural gas 
market reform provision from the last Congress to ensure Enron trading 
practices of the past are not repeated. We had to drop this provision 
because the parliamentarians thought it could be subject to a point of 
order in our committee, so we are putting it back in now.
  We have also added the aircraft idling study, the engine idling 
program, and the hydrogen fuel bus program. If any Member has any 
concerns about these provisions, I look forward to working with you 
through conference. We have added some noncontroversial amendments 
through the affordable housing energy efficiency provisions.
  The other amendments are purely technical in nature, such as removing 
duplicative provisions passed by other committees.
  Finally, Madam Chairman, I want to thank the gentleman from 
California (Mr. Pombo), chairman of the Committee on Resources; the 
gentleman from California (Mr. Thomas), chairman of the Committee on 
Ways and Means; the gentleman from New York (Mr. Boehlert), chairman of 
the Committee on Science; the gentleman from Virginia (Mr. Tom Davis), 
chairman of the Committee on Government Reform; the gentleman from 
Alaska (Mr. Young), chairman of the Committee on Transportation and 
Infrastructure, and their staffs, for helping us put together this 
manager's amendment; and I ask for its adoption.
  Madam Chairman, I reserve the balance of my time.
  Mr. MARKEY. Mr. Chairman, I claim the time in opposition, and I yield 
myself 3 minutes.
  Madam Chairman, I rise in opposition to the Barton manager's 
amendment. I have a number of concerns about the manager's amendment.
  Let me just begin by saying that inside of the bill there was a 
provision that I authored in the Committee on Energy and Commerce that 
was accepted by the Chair, by the majority. And then, without any 
consultation with me, this amendment has been taken out of the energy 
bill by the manager's amendment which is being proposed here today.
  Let me tell you a little bit about the change they are going to make 
without any consultation with me.
  Now, when you think of all the pollution that comes out of 
smokestacks, that is created by the generation of electricity from 
coal-fired plants or from gas-fired plants to create electricity, well, 
that electricity is being created in order, for the most part, to keep 
our lights on, our air-conditioning on, to make sure that we can live 
in a modern society.
  Now, at the Department of Energy, in the first 5 years of the Bush 
administration, they have yet to have a new rulemaking that would 
improve the efficiency of any of these appliances. Now, the cumulative 
impact of that is that we are going to see, unfortunately, several 
hundred new coal-fired or gas-fired generating plants constructed in 
America.
  Now, what does that mean? Well, in addition to the cost to consumers 
who are going to have to pay for these new plants, you also have all of 
the additional pollution. We have 8 million children with asthma. We 
have a rise in breast cancer and prostate cancer and other diseases. 
More than 50 percent of all disease is environmentally based, coming 
from what we breathe, from the water that we drink.
  The majority, in its wisdom, has decided they are going to impose no 
burdens on anyone who makes any appliances in America, so they have to 
improve their efficiency, which is very typical of the entire Bush 
administration's approach to these technologies. But the impact of 
having all of these window air conditioners, furnaces, lighting 
fixtures, heat pumps, 3 years from now, 6 years from now, 10 years from 
now being just as inefficient as they were 5 years ago is that all this 
additional pollution has to go into the

[[Page 7250]]

air: the carbon, the mercury, the sulfur, the nitrous oxide that is 
inhaled by children in our country. And I just think it is wrong, 
without any consultation with me, to take my amendment and put it in 
this manager's amendment, to have it deleted from the bill.
  Madam Chairman, I reserve the balance of my time.
  Mr. BARTON of Texas. Madam Chairman, how much time does the gentleman 
from Texas (Mr. Hall) have?
  The CHAIRMAN. The gentleman from Texas has 1 minute remaining.
  Mr. BARTON of Texas. Would the gentleman from Texas (Mr. Hall) yield 
to me 1 minute?
  Mr. HALL. Madam Chairman, I yield 1 minute to the gentleman from 
Texas (Mr. Barton).
  Mr. BARTON of Texas. Madam Chairman, I do not think it is a surprise 
that I rise in strong support of the Barton manager's amendment, since 
I am the Barton who authored the amendment.
  But I just want to tell my good friend from Massachusetts, whom I 
just listened to extremely closely as he told his tale of woe about his 
amendment being accepted in committee and not accepted in the manager's 
amendment, we found out, as we went to implement it, that there were 
some things we did not understand about his amendment.
  Now, I am sure the gentleman explained it clearly and concisely, and 
I was probably listening to one of my staffers and probably just did 
not hear his explanation, but it was actually retroactive in 
application.
  Madam Chairman, had we accepted it and put it in the manager's 
amendment, there would have been an immediate outcry to implement some 
standards that were not yet implementable because it would have been 
retroactive. That is the primary reason it is not in the manager's 
amendment.
  As we go to conference, we will continue to work with the 
distinguished gentleman, and we probably can find some way to get some 
part of it in in the conference. But that is the primary reason that 
particular amendment is not in the manager's amendment.
  Mr. MARKEY. Madam Chairman, I yield myself the balance of my time.
  Here is the problem with the Bush administration. The Congress, over 
the years, has passed any number of regulations that deal with the 
issue of appliance efficiency, but the Bush administration is allergic 
to energy efficiency. It just wants to put a big new gas station on top 
of the Arctic wilderness or on top of any other pristine area in our 
country rather than looking at the technological genius of our country 
to find some way of improving our efficiency.
  So even with regard to new standards in this manager's amendment, 
they give this administration 6 years, 6 years, to come up with new 
standards, even as the Bush administration has not done anything for 
the first 5 years of its term of office at the height of an energy 
crisis, knowing the consequence of all of this pollution going into the 
atmosphere in terms of its impact upon the health of our country.
  My colleagues, just so you know, women in Japan contract breast 
cancer at only one-fifth the rate of American women. Women in Japan 
contract breast cancer at only one-fifth the rate of American women. 
Women in Japan contract breast cancer at only one-fifth the rate of 
American women. After the family comes to America from Japan, they 
contract it at the same rate as Americans. That means it is not in the 
genes of the girls; it means it is in our air, it is in our water.
  What this amendment does is, it says we are just going to build a 
couple hundred more large electrical generating plants, coal and 
natural gas, and just spew it into the atmosphere. Well, that is going 
to be breathed in, all that mercury, all that sulfur and nitrous oxide, 
and it is going to have a dramatically negative impact upon the health 
of our country.
  My colleagues, this is a bad amendment, and I really regret it is out 
here and that my friend has proposed it.
  The CHAIRMAN. All time has expired. The question is on the amendment 
offered by the gentleman from Texas (Mr. Hall).
  The amendment was agreed to.
  The CHAIRMAN. It is now in order to consider amendment No. 2 printed 
in House Report 109-49.


                 Amendment No. 2 Offered by Mr. Dingell

  Mr. DINGELL. Mr. Chairman, I offer an amendment.
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 2 offered by Mr. Dingell:
       Title XII of H.R. 6 is amended by striking sections 1201 
     through 1235 and sections 1237 through 1298, by striking the 
     title heading, by inserting the following before title XIII, 
     by redesignating section 1236 (relating to native load 
     service obligation) as section 1233 of the following and 
     inserting such redesignated section 1233 after section 1232 
     of the following, and by making the necessary conforming 
     changes in the table of contents:

                         TITLE XII--ELECTRICITY

     SECTION 1201. SHORT TITLE.

       This title may be cited as the ``Electric Reliability 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 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 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).
       ``(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 issu-
     ance 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

[[Page 7251]]

     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.
     The total amount of all dues, fees, and other charges 
     collected by the ERO in each of the fiscal years 2006 through 
     2015 and allocated under subparagraph (B) shall not exceed 
     $50,000,000.
       ``(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 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.

[[Page 7252]]

       ``(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) Limitation on Annual Appropriations.--There is 
     authorized to be appropriated not more than $50,000,000 per 
     year for fiscal years 2006 through 2015 for all activities 
     under the amendment made by subsection (a).

            Subtitle B--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 the following new 
     section:

     ``SEC. 211A. OPEN ACCESS BY UNREGULATED TRANSMITTING 
                   UTILITIES.

       ``(a) Transmission 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 such unregulated 
     transmitting utility provides transmission services to itself 
     and that are not unduly discriminatory or preferential.
       ``(b) Exemption.--The Commission shall exempt from any rule 
     or order under this section any unregulated transmitting 
     utility that--
       ``(1) sells no more than 4,000,000 megawatt hours of 
     electricity per year; or
       ``(2) does not own or operate any transmission facilities 
     that are necessary for operating an interconnected 
     transmission system (or any portion thereof); or
       ``(3) meets other criteria the Commission determines to be 
     in the public interest.
       ``(c) Local Distribution Facilities.--The requirements of 
     subsection (a) shall not apply to facilities used in local 
     distribution.
       ``(d) Exemption Termination.--Whenever the Commission, 
     after an evidentiary hearing held upon 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 (b) unreasonably impairs the continued reliability 
     of an interconnected transmission system, it shall revoke the 
     exemption granted to that transmitting utility.
       ``(e) 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.
       ``(f) Remand.--In exercising its authority under paragraph 
     (1) of subsection (a), the Commission may remand transmission 
     rates to an unregulated transmitting utility for review and 
     revision where necessary to meet the requirements of 
     subsection (a).
       ``(g) Other Requests.--The provision of transmission 
     services under subsection (a) does not preclude a request for 
     transmission services under section 211.
       ``(h) 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 (26 U.S.C. 141).
       ``(i) 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 an RTO 
     or any other Commission-approved independent transmission 
     organization designated to provide nondiscriminatory 
     transmission access.
       ``(j) Definition.--For purposes of 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).''.

     SEC. 1232. FEDERAL UTILITY PARTICIPATION IN REGIONAL 
                   TRANSMISSION ORGANIZATIONS.

       (a) Definitions.--For purposes of this section--
       (1) Appropriate federal regulatory authority.--The term 
     ``appropriate Federal regulatory authority'' means--
       (A) with respect to a Federal power marketing agency (as 
     defined in the Federal Power Act), the Secretary of Energy, 
     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 that Federal power marketing agency; and
       (B) with respect to the Tennessee Valley Authority, the 
     Board of Directors of the Tennessee Valley Authority.
       (2) Federal utility.--The term ``Federal utility'' means a 
     Federal power marketing agency or the Tennessee Valley 
     Authority.
       (3) Transmission system.--The term ``transmission system'' 
     means electric transmission facilities owned, leased, or 
     contracted for by the United States and operated by a Federal 
     utility.
       (b) Transfer.--The appropriate Federal regulatory authority 
     is authorized to enter into a contract, agreement or other 
     arrangement transferring control and use of all or part of 
     the Federal utility's transmission system to an RTO or ISO 
     (as defined in the Federal Power Act), approved by the 
     Federal Energy Regulatory Commission. Such 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 necessary or appropriate, including standards that 
     assure recovery of all the Federal utility's costs and 
     expenses related to the transmission facilities that are the 
     subject of the contract, agreement or other arrangement; 
     consistency with existing contracts and third-party financing 
     arrangements; and consistency with said Federal utility's 
     statutory authorities, obligations, and limitations;
       (2) provisions for monitoring and oversight by the Federal 
     utility of the RTO's or ISO's fulfillment of the 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 regional 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 RTO or ISO and terminate the contract, agreement or 
     other arrangement in accordance with its terms.
     Neither this section, actions taken pursuant to it, nor any 
     other transaction of a Federal utility using an RTO or ISO 
     shall confer upon the Federal Energy Regulatory Commission 
     jurisdiction or authority over the Federal utility's electric 
     generation assets, electric capacity or energy that the 
     Federal utility is authorized by law to market, or the 
     Federal utility's power sales activities.
       (c) Existing Statutory and Other Obligations.--
       (1) System operation requirements.--No statutory provision 
     requiring or authorizing a Federal utility to transmit 
     electric power or to construct, operate or maintain its 
     transmission system shall be construed to prohibit a transfer 
     of control and use of its transmission system pursuant to, 
     and subject to all requirements of subsection (b).
       (2) Other obligations.--This subsection shall not be 
     construed to--
       (A) suspend, or exempt any Federal utility from, any 
     provision of existing Federal law, including but not limited 
     to any requirement or direction relating to the use of the 
     Federal utility's transmission system, environmental 
     protection, fish and wildlife protection, flood control, 
     navigation, water delivery, or recreation; or
       (B) authorize abrogation of any contract or treaty 
     obligation.
       (3) Repeal.--Section 311 of title III of Appendix B of the 
     Act of October 27, 2000 (P.L. 106-377, section 1(a)(2); 114 
     Stat. 1441, 1441A-80; 16 U.S.C. 824n) is repealed.

                    Subtitle C--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-

[[Page 7253]]

     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 Utilities 
     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; and
       ``(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.
       ``(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 Utilities 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 of Energy 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

[[Page 7254]]

     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; and
       (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.
       (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, and the deployment of such technology and devices 
     that enable electricity customers to participate in such 
     pricing and demand response systems shall be facilitated. 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).''.

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

     SEC. 1282. 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. 221. PROHIBITION ON FILING FALSE INFORMATION.

       ``No person or other 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 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 such 
     Federal agency.

     ``SEC. 222. PROHIBITION ON ROUND TRIP TRADING.

       ``(a) Prohibition.--No person or other entity (including an 
     entity described in section 201(f)) shall willfully and 
     knowingly enter into any contract or other arrangement to 
     execute a `round trip trade' for the purchase or sale of 
     electric energy at wholesale.
       ``(b) Definition.--For the purposes of this section, the 
     term `round trip trade' means a transaction, or combination 
     of transactions, in which a person or any other entity--
       ``(1) enters into a contract or other arrangement to 
     purchase from, or sell to, any other person or other entity 
     electric energy at wholesale;
       ``(2) simultaneously with entering into the contract or 
     arrangement described in paragraph (1), arranges a 
     financially offsetting trade with such other person or entity 
     for the same such electric energy, at the same location, 
     price, quantity and terms so that, collectively, the purchase 
     and sale transactions in themselves result in no financial 
     gain or loss; and
       ``(3) enters into the contract or arrangement with a 
     specific intent to fraudulently affect reported revenues, 
     trading volumes, or prices.''.

     SEC. 1283. FRAUDULENT OR MANIPULATIVE PRACTICES.

       (a) Unlawful Acts.--It shall be unlawful for any entity, 
     directly or indirectly, by the use of any means or 
     instrumentality of interstate commerce or of the mails to use 
     or employ, in 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, or the sale in interstate commerce of 
     natural gas for resale for ultimate public consumption for 
     domestic, commercial, industrial, or any other use, any 
     fraudulent, manipulative, or deceptive device or contrivance 
     in contravention of such rules and regulations as the Federal 
     Energy Regulatory Commission may prescribe as necessary or 
     appropriate in the public interest.
       (b) Application of Federal Power Act to This Act.--The 
     provisions of section 307 through 309 and 313 through 317 of 
     the Federal Power Act shall apply to violations of the 
     Electric Reliability Act of 2005 in the same manner and to 
     the same extent as such provisions apply to entities subject 
     to Part II of the Federal Power Act.

     SEC. 1284. RULEMAKING ON EXEMPTIONS, WAIVERS, ETC UNDER 
                   FEDERAL POWER ACT.

        Part III of the Federal Power Act is amended by inserting 
     the following new section after section 319 and by 
     redesignating sections 320 and 321 as sections 321 and 322, 
     respectively:

     ``SEC. 320. CRITERIA FOR CERTAIN EXEMPTIONS, WAIVERS, ETC.

       ``(a) Rule Required for Certain Waivers, Exemptions, Etc.--
     Not later than 6 months after the enactment of this Act, the 
     Commission shall promulgate a rule establishing specific 
     criteria for providing an exemption, waiver, or other reduced 
     or abbreviated form of compliance with the requirements of 
     sections 204, 301, 304, and 305 (including any prospective 
     blanket order). Such criteria shall be sufficient to insure 
     that any such action taken by the Commission will be 
     consistent with the purposes of such requirements and will 
     otherwise protect the public interest.
       ``(b) Moratorium on Certain Waivers, Exemptions, Etc.--
     After the date of enactment of this section, the Commission 
     may not issue, adopt, order, approve, or promulgate any 
     exemption, waiver, or other reduced or abbreviated form of 
     compliance with the requirements of section 204, 301, 304, or 
     305 (including any prospective blanket order) until after the 
     rule promulgated under subsection (a) has taken effect.
       ``(c) Previous FERC Action.--The Commission shall undertake 
     a review, by rule or order, of each exemption, waiver, or 
     other reduced or abbreviated form of compliance described in 
     subsection (a) that was taken before the date of enactment of 
     this section. No such action may continue in force and effect 
     after the date 18 months after the date of enactment of this 
     section unless the Commission finds that such action complies 
     with the rule under subsection (a).
       ``(d) Exemption Under 204(f) not Applicable.--For purposes 
     of this section, in applying section 204, the provisions of 
     section 204(f) shall not apply.''.

     SEC. 1285. REPORTING REQUIREMENTS IN ELECTRIC POWER SALES AND 
                   TRANSMISSION.

       (a) Audit Trails.--Section 304 of the Federal Power Act is 
     amended by adding the following new subsection at the end 
     thereof:
       ``(c)(1) The Commission shall, by rule or order, require 
     each person or other entity engaged in the transmission of 
     electric energy in interstate commerce or the sale of 
     electric energy at wholesale in interstate commerce, and each 
     broker, dealer, and power marketer involved in any such 
     transmission or sale, to maintain, and periodically submit to 
     the Commission, such records, in electronic form, of each 
     transaction relating to such transmission or sale as may be 
     necessary to determine whether any person has employed any 
     fraudulent, manipulative, or deceptive device or contrivance 
     in contravention of rules promulgated by the Commission.
       ``(2) Section 201(f) shall not limit the application of 
     this subsection.''.

[[Page 7255]]

       (b) Natural Gas.--Section 8 of the Natural Gas Act is 
     amended by adding the following new subsection at the end 
     thereof:
       ``(d) The Commission shall, by rule or order, require each 
     person or other entity engaged in the transportation of 
     natural gas in interstate commerce, or the sale in interstate 
     commerce of natural gas for resale for ultimate public 
     consumption for domestic, commercial, industrial, or any 
     other use, and each broker, dealer, and power marketer 
     involved in any such transportation or sale, to maintain, and 
     periodically submit to the Commission, such records, in 
     electronic form, of each transaction relating to such 
     transmission or sale as may be necessary to determine whether 
     any person has employed any fraudulent, manipulative, or 
     deceptive device or contrivance in contravention of rules 
     promulgated by the Commission.''.

     SEC. 1286. TRANSPARENCY.

       (a) Definition.--As used in this section the term 
     ``electric power or natural gas information processor'' means 
     any person engaged in the business of--
       (1) collecting, processing, or preparing for distribution 
     or publication, or assisting, participating in, or 
     coordinating the distribution or publication of, information 
     with respect to transactions in or quotations involving the 
     purchase or sale of electric power, natural gas, the 
     transmission of electric energy, or the transportation of 
     natural gas, or
       (2) distributing or publishing (whether by means of a 
     ticker tape, a communications network, a terminal display 
     device, or otherwise) on a current and continuing basis, 
     information with respect to such transactions or quotations.

     The term does not include any bona fide newspaper, news 
     magazine, or business or financial publication of general and 
     regular circulation, any self-regulatory organization, any 
     bank, broker, dealer, building and loan, savings and loan, or 
     homestead association, or cooperative bank, if such bank, 
     broker, dealer, association, or cooperative bank would be 
     deemed to be an electric power or natural gas information 
     processor solely by reason of functions performed by such 
     institutions as part of customary banking, brokerage, 
     dealing, association, or cooperative bank activities, or any 
     common carrier, as defined in section 3 of the Communications 
     Act of 1934, subject to the jurisdiction of the Federal 
     Communications Commission or a State commission, as defined 
     in section 3 of that Act, unless the Commission determines 
     that such carrier is engaged in the business of collecting, 
     processing, or preparing for distribution or publication, 
     information with respect to transactions in or quotations 
     involving the purchase or sale of electric power, natural 
     gas, the transmission of electric energy, or the 
     transportation of natural gas.
       (b) Prohibition.--No electric power or natural gas 
     information processor may make use of the mails or any means 
     or instrumentality of interstate commerce--
       (1) to collect, process, distribute, publish, or prepare 
     for distribution or publication any information with respect 
     to quotations for, or transactions involving the purchase or 
     sale of electric power, natural gas, the transmission of 
     electric energy, or the transportation of natural gas, or
       (2) to assist, participate in, or coordinate the 
     distribution or publication of such information in 
     contravention of such rules and regulations as the Federal 
     Energy Regulatory Commission shall prescribe as necessary or 
     appropriate in the public interest to--
       (A) prevent the use, distribution, or publication of 
     fraudulent, deceptive, or manipulative information with 
     respect to quotations for and transactions involving the 
     purchase or sale of electric power, natural gas, the 
     transmission of electric energy, or the transportation of 
     natural gas;
       (B) assure the prompt, accurate, reliable, and fair 
     collection, processing, distribution, and publication of 
     information with respect to quotations for and transactions 
     involving the purchase or sale of electric power, natural 
     gas, the transmission of electric energy, or the 
     transportation of natural gas, and the fairness and 
     usefulness of the form and content of such information;
       (C) assure that all such information processors may, for 
     purposes of distribution and publication, obtain on fair and 
     reasonable terms such information with respect to quotations 
     for and transactions involving the purchase or sale of 
     electric power, natural gas, the transmission of electric 
     energy, or the transportation of natural gas as is collected, 
     processed, or prepared for distribution or publication by any 
     exclusive processor of such information acting in such 
     capacity;
       (D) assure that, subject to such limitations as the 
     Commission, by rule, may impose as necessary or appropriate 
     for the maintenance of fair and orderly markets, all persons 
     may obtain on terms which are not unreasonably discriminatory 
     such information with respect to quotations for and 
     transactions involving the purchase or sale of electric 
     power, natural gas, the transmission of electric energy, or 
     the transportation of natural gas as is published or 
     distributed by any electric power or natural gas information 
     processor;
       (E) assure that all electricity and natural gas electronic 
     communication networks transmit and direct orders for the 
     purchase and sale of electricity or natural gas in a manner 
     consistent with the establishment and operation of an 
     efficient, fair, and orderly market system for electricity 
     and natural gas; and
       (F) assure equal regulation of all markets involving the 
     purchase or sale of electric power, natural gas, the 
     transmission of electric energy, or the transportation of 
     natural gas and all persons effecting transactions involving 
     the purchase or sale of electric power, natural gas, the 
     transmission of electric energy, or the transportation of 
     natural gas.
       (c) Related Commodities.--For purposes of this section, the 
     phrase ``purchase or sale of electric power, natural gas, the 
     transmission of electric energy, or the transportation of 
     natural gas'' includes the purchase or sale of any commodity 
     (as defined in the Commodities Exchange Act) relating to any 
     such purchase or sale if such commodity is excluded from 
     regulation under the Commodities Exchange Act pursuant to 
     section 2 of that Act.
       (d) Prohibition.--No person who owns, controls, or is under 
     the control or ownership of a public utility, a natural gas 
     company, or a public utility holding company may own, 
     control, or operate any electronic computer network or other 
     mulitateral trading facility utilized to trade electricity or 
     natural gas.

     SEC. 1287. PENALTIES.

       (a) Criminal Penalties.--Section 316 of the Federal Power 
     Act (16 U.S.C. 825o(c)) is amended as follows:
       (1) By striking ``$5,000'' in subsection (a) and inserting 
     ``$5,000,000 for an individual and $25,000,000 for any other 
     defendant'' and by striking out ``two years'' and inserting 
     ``five years'' .
       (2) By striking ``$500'' in subsection (b) and inserting 
     ``$1,000,000''.
       (3) By striking subsection (c).
       (b) Civil Penalties.--Section 316A of the Federal Power Act 
     (16 U.S.C. 825o091) is amended as follows:
       (1) By striking ``section 211, 212, 213, or 214'' each 
     place it appears and inserting ``Part II''.
       (2) By striking ``$10,000 for each day that such violation 
     continues'' and inserting ``the greater of $1,000,000 or 
     three times the profit made or gain or loss avoided by reason 
     of such violation''.
       (3) By adding the following at the end thereof:
       ``(c) Authority of a Court to Prohibit Persons From Certain 
     Activities.--In any proceeding under this section, the court 
     may censure, place limitations on the activities, functions, 
     or operations of, suspend or revoke the ability of any entity 
     (without regard to section 201(f)) to participate in the 
     transmission of electric energy in interstate commerce or the 
     sale of electric energy at wholesale in interstate commerce 
     if it finds that such censure, placing of limitations, 
     suspension, or revocation is in the public interest and that 
     one or more of the following applies to such entity:
       ``(1) Such entity has willfully made or caused to be made 
     in any application or report required to be filed with the 
     Commission or with any other appropriate regulatory agency, 
     or in any proceeding before the Commission, any statement 
     which was at the time and in the light of the circumstances 
     under which it was made false or misleading with respect to 
     any material fact, or has omitted to state in any such 
     application or report any material fact which is required to 
     be stated therein.
       ``(2) Such entity has been convicted of any felony or 
     misdemeanor or of a substantially equivalent crime by a 
     foreign court of competent jurisdiction which the court 
     finds--
       ``(A) involves the purchase or sale of electricity, the 
     taking of a false oath, the making of a false report, 
     bribery, perjury, burglary, any substantially equivalent 
     activity however denominated by the laws of the relevant 
     foreign government, or conspiracy to commit any such offense;
       ``(B) arises out of the conduct of the business of 
     transmitting electric energy in interstate commerce or 
     selling or purchasing electric energy at wholesale in 
     interstate commerce;
       ``(C) involves the larceny, theft, robbery, extortion, 
     forgery, counterfeiting, fraudulent concealment, 
     embezzlement, fraudulent conversion, or misappropriation of 
     funds, or securities, or substantially equivalent activity 
     however denominated by the laws of the relevant foreign 
     government; or
       ``(D) involves the violation of section 152, 1341, 1342, or 
     1343 or chapter 25 or 47 of title 18, United States Code, or 
     a violation of a substantially equivalent foreign statute.
       ``(3) Such entity is permanently or temporarily enjoined by 
     order, judgment, or decree of any court of competent 
     jurisdiction from acting as an investment adviser, 
     underwriter, broker, dealer, municipal securities dealer, 
     government securities broker, government securities dealer, 
     transfer agent, foreign person performing a function 
     substantially equivalent to any of the above, or entity or 
     person required to be registered under the Commodity Exchange 
     Act or any substantially equivalent foreign statute or

[[Page 7256]]

     regulation, or as an affiliated person or employee of any 
     investment company, bank, insurance company, foreign entity 
     substantially equivalent to any of the above, or entity or 
     person required to be registered under the Commodity Exchange 
     Act or any substantially equivalent foreign statute or 
     regulation, or from engaging in or continuing any conduct or 
     practice in connection with any such activity, or in 
     connection with the purchase or sale of any security.
       ``(4) Such entity has willfully violated any provision of 
     this Act.
       ``(5) Such entity has willfully aided, abetted, counseled, 
     commanded, induced, or procured the violation by any other 
     person of any provision of this Act, or has failed reasonably 
     to supervise, with a view to preventing violations of the 
     provisions of this Act, another person who commits such a 
     violation, if such other person is subject to his 
     supervision. For the purposes of this paragraph no person 
     shall be deemed to have failed reasonably to supervise any 
     other person, if--
       ``(A) there have been established procedures, and a system 
     for applying such procedures, which would reasonably be 
     expected to prevent and detect, insofar as practicable, any 
     such violation by such other person, and
       ``(B) such person has reasonably discharged the duties and 
     obligations incumbent upon him by reason of such procedures 
     and system without reasonable cause to believe that such 
     procedures and system were not being complied with.
       ``(6) Such entity has been found by a foreign financial or 
     energy regulatory authority to have--
       ``(A) made or caused to be made in any application or 
     report required to be filed with a foreign regulatory 
     authority, or in any proceeding before a foreign financial or 
     energy regulatory authority, any statement that was at the 
     time and in the light of the circumstances under which it was 
     made false or misleading with respect to any material fact, 
     or has omitted to state in any application or report to the 
     foreign regulatory authority any material fact that is 
     required to be stated therein;
       ``(B) violated any foreign statute or regulation regarding 
     the transmission or sale of electricity or natural gas;
       ``(C) aided, abetted, counseled, commanded, induced, or 
     procured the violation by any person of any provision of any 
     statutory provisions enacted by a foreign government, or 
     rules or regulations thereunder, empowering a foreign 
     regulatory authority regarding transactions in electricity or 
     natural gas, or contracts of sale of electricity or natural 
     gas, traded on or subject to the rules of a contract market 
     or any board of trade, or has been found, by a foreign 
     regulatory authority, to have failed

     reasonably to supervise, with a view to preventing violations 
     of such statutory provisions, rules, and regulations, another 
     person who commits such a violation, if such other person is 
     subject to his supervision.
       ``(7) Such entity is subject to any final order of a State 
     commission (or any agency or officer performing like 
     functions), State authority that supervises or examines 
     banks, savings associations, or credit unions, State 
     insurance commission (or any agency or office performing like 
     functions), an appropriate Federal banking agency (as defined 
     in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 
     1813(q))), or the National Credit Union Administration, 
     that--
       ``(A) bars such person from association with an entity 
     regulated by such commission, authority, agency, or officer, 
     or from engaging in the business of securities, insurance, 
     banking, savings association activities, or credit union 
     activities; or
       ``(B) constitutes a final order based on violations of any 
     laws or regulations that prohibit fraudulent, manipulative, 
     or deceptive conduct.''
       (4) Such entity is subject to statutory disqualification 
     within the meaning of section 3(a)(39) of the Securities 
     Exchange Act of 1934.''.
       (c) Natural Gas Act Penalties.--Section 21 of the Natural 
     Gas Act is amended by adding the following new subsection at 
     the end thereof:
       ``(c) Authority of a Court to Prohibit Persons From Certain 
     Activities.--In any proceeding under this section, the court 
     may censure, place limitations on the activities, functions, 
     or operations of, suspend or revoke the ability of any entity 
     (without regard to section 201(f)) to participate in the 
     transportation of natural gas in interstate commerce, or the 
     sale in interstate commerce of natural gas for resale for 
     ultimate public consumption for domestic, commercial, 
     industrial, or any other use if it finds that such censure, 
     placing of limitations, suspension, or revocation is in the 
     public interest and that one or more of the following applies 
     to such entity:
       ``(1) Such entity has willfully made or caused to be made 
     in any application or report required to be filed with the 
     Commission or with any other appropriate regulatory agency, 
     or in any proceeding before the Commission, any statement 
     which was at the time and in the light of the circumstances 
     under which it was made false or misleading with respect to 
     any material fact, or has omitted to state in any such 
     application or report any material fact which is required to 
     be stated therein.
       ``(2) Such entity has been convicted of any felony or 
     misdemeanor or of a substantially equivalent crime by a 
     foreign court of competent jurisdiction which the court 
     finds--
       ``(A) involves the purchase or sale of natural gas, the 
     taking of a false oath, the making of a false report, 
     bribery, perjury, burglary, any substantially equivalent 
     activity however denominated by the laws of the relevant 
     foreign government, or conspiracy to commit any such offense;
       ``(B) arises out of the conduct of the business of 
     transmitting natural gas in interstate commerce, or the 
     selling in interstate commerce of natural gas for resale for 
     ultimate public consumption for domestic, commercial, 
     industrial, or any other use;
       ``(C) involves the larceny, theft, robbery, extortion, 
     forgery, counterfeiting, fraudulent concealment, 
     embezzlement, fraudulent conversion, or misappropriation of 
     funds, or securities, or substantially equivalent activity 
     however denominated by the laws of the relevant foreign 
     government; or
       ``(D) involves the violation of section 152, 1341, 1342, or 
     1343 or chapter 25 or 47 of title 18, United States Code, or 
     a violation of a substantially equivalent foreign statute.
       ``(3) Such entity is permanently or temporarily enjoined by 
     order, judgment, or decree of any court of competent 
     jurisdiction from acting as an investment adviser, 
     underwriter, broker, dealer, municipal securities dealer, 
     government securities broker, government securities dealer, 
     transfer agent, foreign person performing a function 
     substantially equivalent to any of the above, or entity or 
     person required to be registered under the Commodity Exchange 
     Act or any substantially equivalent foreign statute or 
     regulation, or as an affiliated person or employee of any 
     investment company, bank, insurance company, foreign entity 
     substantially equivalent to any of the above, or entity or 
     person required to be registered under the Commodity Exchange 
     Act or any substantially equivalent foreign statute or 
     regulation, or from engaging in or continuing any conduct or 
     practice in connection with any such activity, or in 
     connection with the purchase or sale of any security.
       ``(4) Such entity has willfully violated any provision of 
     this Act.
       ``(5) Such entity has willfully aided, abetted, counseled, 
     commanded, induced, or procured the violation by any other 
     person of any provision of this Act, or has failed reasonably 
     to supervise, with a view to preventing violations of the 
     provisions of this Act, another person who commits such a 
     violation, if such other person is subject to his 
     supervision. For the purposes of this paragraph no person 
     shall be deemed to have failed reasonably to supervise any 
     other person, if--
       ``(A) there have been established procedures, and a system 
     for applying such procedures, which would reasonably be 
     expected to prevent and detect, insofar as practicable, any 
     such violation by such other person, and
       ``(B) such person has reasonably discharged the duties and 
     obligations incumbent upon him by reason of such procedures 
     and system without reasonable cause to believe that such 
     procedures and system were not being complied with.
       ``(6) Such entity has been found by a foreign financial or 
     energy regulatory authority to have--
       ``(A) made or caused to be made in any application or 
     report required to be filed with a foreign regulatory 
     authority, or in any proceeding before a foreign financial or 
     energy regulatory authority, any statement that was at the 
     time and in the light of the circumstances under which it was 
     made false or misleading with respect to any material fact, 
     or has omitted to state in any application or report to the 
     foreign regulatory authority any material fact that is 
     required to be stated therein;
       ``(B) violated any foreign statute or regulation regarding 
     the transmission or sale of electricity or natural gas;
       ``(C) aided, abetted, counseled, commanded, induced, or 
     procured the violation by any person of any provision of any 
     statutory provisions enacted by a foreign government, or 
     rules or regulations thereunder, empowering a foreign 
     regulatory authority regarding transactions in electricity or 
     natural gas, or contracts of sale of electricity or natural 
     gas, traded on or subject to the rules of a contract market 
     or any board of trade, or has been found, by a foreign 
     regulatory authority, to have failed reasonably to supervise, 
     with a view to preventing violations of such statutory 
     provisions, rules, and regulations, another person who 
     commits such a violation, if such other person is subject to 
     his supervision.
       ``(7) Such entity is subject to any final order of a State 
     commission (or any agency or officer performing like 
     functions), State authority that supervises or examines 
     banks, savings associations, or credit unions, State 
     insurance commission (or any agency or office performing like 
     functions), an appropriate Federal banking agency (as defined 
     in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 
     1813(q))), or the National Credit Union Administration, 
     that--
       ``(A) bars such person from association with an entity 
     regulated by such commission, authority, agency, or officer, 
     or from

[[Page 7257]]

     engaging in the business of securities, insurance, banking, 
     savings association activities, or credit union activities; 
     or
       ``(B) constitutes a final order based on violations of any 
     laws or regulations that prohibit fraudulent, manipulative, 
     or deceptive conduct.
       ``(8) Such entity is subject to statutory disqualification 
     within the meaning of section 3(a)(39) of the Securities 
     Exchange Act of 1934.''.

     SEC. 1288. REVIEW OF PUHCA EXEMPTIONS.

        Not later than 12 months after the enactment of this Act 
     the Securities and Exchange Commission shall review each 
     exemption granted to any person under section 3(a) of the 
     Public Utility Holding Company Act of 1935 and shall review 
     the action of persons operating pursuant to a claim of exempt 
     status under section 3 to determine if such exemptions and 
     claims are consistent with the requirements of such section 
     3(a) and whether or not such exemptions or claims of 
     exemption should continue in force and effect.

     SEC. 1289. REVIEW OF ACCOUNTING FOR CONTRACTS INVOLVED IN 
                   ENERGY TRADING.

       Not later than 12 months after the enactment of this Act, 
     the Comptroller General of the United States shall submit to 
     the Congress a report of the results of its review of 
     accounting for contracts in energy trading and risk 
     management activities. The review and report shall include, 
     among other issues, the use of mark-to-market accounting and 
     when gains and losses should be recognized, with a view 
     toward improving the transparency of energy trading 
     activities for the benefit of investors, consumers, and the 
     integrity of these markets.

     SEC. 1290. PROTECTION OF FERC REGULATED SUBSIDIARIES.

        Section 205 of the Federal Power Act is amended by adding 
     after subsection (f) the following new subsection:
       ``(g) Rules and Procedures to Protect Consumers of Public 
     Utilities.--Not later than 9 months after the date of 
     enactment of this Act, the Commission shall adopt rules and 
     procedures for the protection of electric consumers from 
     self-dealing, interaffiliate abuse, and other harmful actions 
     taken by persons owning or controlling public utilities. Such 
     rules shall ensure that no asset of a public utility company 
     shall be used as collateral for indebtedness incurred by the 
     holding company of, and any affiliate of, such public utility 
     company, and no public utility shall acquire or own any 
     securities of the holding company or other affiliates of the 
     holding company unless the Commission has determined that 
     such acquisition or ownership is consistent with the public 
     interest and the protection of consumers of such public 
     utility.''.

     SEC. 1291. REFUNDS UNDER THE FEDERAL POWER ACT.

        Section 206(b) of the Federal Power Act is amended as 
     follows:
       (1) By amending the first sentence to read as follows: ``In 
     any proceeding under this section, the refund effective date 
     shall be the date of the filing of a complaint or the date of 
     the Commission motion initiating the proceeding, except that 
     in the case of a complaint with regard to market-based rates, 
     the Commission may establish an earlier refund effective 
     date.''.
       (2) By striking the second and third sentences.
       (3) By striking out ``the refund effective date or by'' and 
     ``, whichever is earlier,'' in the fifth sentence.
       (4) In the seventh sentence by striking ``through a date 
     fifteen months after such refund effective date'' and insert 
     ``and prior to the conclusion of the proceeding'' and by 
     striking the proviso.

     SEC. 1292. ACCOUNTS AND REPORTS.

        Section 318 of the Federal Power Act is amended by adding 
     the following at the end thereof: ``This section shall not 
     apply to sections 301 and 304 of this Act.''.

     SEC. 1293. MARKET-BASED RATES.

        Section 205 of the Federal Power Act is amended by adding 
     the following new subsection at the end thereof:
       ``(g) For each public utility granted the authority by the 
     Commission to sell electric energy at market-based rates, the 
     Commission shall review the activities and characteristics of 
     such utility not less frequently than annually to determine 
     whether such rates are just and reasonable. Each such utility 
     shall notify the Commission promptly of any change in the 
     activities and characteristics relied upon by the Commission 
     in granting such public utility the authority to sell 
     electric energy at market-based rates. If the Commission 
     finds that:
       ``(1) a rate charged by a public utility authorized to sell 
     electric energy at market-based rates is unjust, 
     unreasonable, unduly discriminatory or preferential,
       ``(2) the public utility has intentionally engaged in an 
     activity that violates any other rule, tariff, or order of 
     the Commission, or
       ``(3) any violation of the Electric Reliability Act of 
     2005,
     the Commission shall issue an order immediately modifying or 
     revoking the authority of that public utility to sell 
     electric energy at market-based rates.''.

     SEC. 1294. ENFORCEMENT.

       (a) Complaints.--Section 306 of the Federal Power Act (16 
     U.S.C. 825e) is amended as follows:
       (1) By inserting ``electric utility,'' after ``Any 
     person,''.
       (2) By inserting ``, transmitting utility,'' after 
     ``licensee'' each place it appears.
       (b) Review of Commission Orders.--Section 313(a) of the 
     Federal Power Act (16 U.S.C. 8251) 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''.
       (c) Investigations.--Section 307(a) of the Federal Power 
     Act (16 U.S.C. 825f(a)) is amended as follows:
       (1) By inserting ``, electric utility, transmitting 
     utility, or other entity'' after ``person'' each time it 
     appears.
       (2) By striking the period at the end of the first sentence 
     and inserting 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.''.

     SEC. 1295. 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).
       ``(d) The Commission shall, by rule or order, require each 
     person or other entity engaged in the transportation of 
     natural gas in interstate commerce, or the sale in interstate 
     commerce of natural gas for resale for ultimate public 
     consumption for domestic, commercial, industrial, or any 
     other use, and each broker, dealer, and power marketer 
     involved in any such transportation or sale, to maintain, and 
     periodically submit to the Commission, such records, in 
     electronic form, of each transaction relating to such 
     transmission or sale as may be necessary to determine whether 
     any person has employed any fraudulent, manipulative, or 
     deceptive device or contrivance in contravention of rules 
     promulgated by the Commission.''.

     SEC. 1296. SAVINGS PROVISION.

       Nothing in this title or in any amendment made by this 
     title shall be construed to affect the authority of any court 
     to make a determination in any proceeding commenced before 
     the enactment of this Act regarding the authority of the 
     Federal Energy Regulatory Commission to permit any person to 
     sell or distribute electric energy at market-based rates.

  The CHAIRMAN. Pursuant to House Resolution 219, the gentleman from 
Michigan (Mr. Dingell) and the gentleman from Texas (Mr. Barton) each 
will control 10 minutes.
  The Chair recognizes the gentleman from Michigan (Mr. Dingell).
  Mr. DINGELL. Madam Chairman, I yield myself 3 minutes.
  Madam Chairman, it is regrettable indeed that we function under such 
a constrained rule, but the amendment which I have been permitted to 
offer here contains real benefits for electricity consumers and 
includes many of the reforms that I and other of my colleagues have 
proposed in committee markups, on the House floor, and in conference 
during consideration of various energy bills.
  First, the amendment would prevent future Enron-like debacles by 
providing the Federal Energy Regulatory Commission with broad authority 
to deter and punish fraudulent behavior that distorts electricity and 
natural gas markets.

                              {time}  1715

  Enron's ingenuity demonstrates how difficult it is for regulators to 
foresee,

[[Page 7258]]

punish, prevent, and correct every type of misconduct. A recent FERC 
report concluded, ``Currently, the Commission has few remedies to 
address misconduct by market participants.''
  Second, my amendment addresses an important real electricity concern, 
the need to ensure that the FERC has the authority to issue orders 
requiring refunds for all electricity overcharges. Regrettably, that is 
not now the case. The skill and arts of Enron and Enron-like rascals 
will enable them to escape much of the refunds which they should make 
after the most active kind of wrong doing, as we saw in the western 
part of the United States.
  Third, the amendment does not repeal the Public Utility Holding 
Company Act of 1935 without which Enron would certainly have purchased 
more utilities than it did, sunk its tentacles even more deeply into 
the electric industry, and skinned more consumers and innocent buyers 
of electricity.
  The amendment requires the SEC to review a company's existing 
exemptions under the act to make sure they do not assert false claim, 
as the commission belatedly determined Enron had done.
  With due respect to the gentleman from Texas (Mr. Barton), I believe 
my amendment provides a far better alternative for consumers than the 
wholly inadequate provisions of H.R. 6. H.R. 6 includes only limited 
cosmetic changes to current Federal electricity law. It outlaws 
``roundtrip trading'' and filing of false information, but offers no 
protection against schemes liken Enron's Death Star, Get Shorty, or 
Richochet.
  Moreover, H.R. 6 does not authorize FERC to grant full refunds to 
consumers who were skinned by inflated electricity prices, but rather 
allows refunds only from the date when the complaint is filed.
  Finally, H.R. 6 repeals PUHCA, leaving consumers and investors even 
more vulnerable to deception by Enron-type players who concoct 
``special purpose entities'' to move money around while hiding behind 
complex, opaque corporate structures. I would note a recent Standard & 
Poor report states: ``Utility investment in non-core businesses has 
been responsible for most of the credit deterioration in the utility 
industry.'' I urge my colleagues to adopt the amendment.
  Mr. BARTON of Texas. Madam Chairman, I yield myself 4 minutes.
  Madam Chairman, first, I rise in opposition to the Dingell 
substitute. I do want the record to show that I supported at the 
Committee on Rules that it be made in order so we could have a full 
debate.
  The Dingell substitute, if it were actually to be implemented into 
the bill and become law, would go far beyond anything currently being 
considered in the electricity sector. It would increase the fines 
already under the bill that go up to $1 million. The Dingell substitute 
would take that to $5 million and in some cases $25 million. I will 
admit with the gentleman from Michigan that the current fine is 
insignificant. I think it is $5,000, and we need to increase that. So 
the bill takes it to $1 million. The Dingell substitute would take it 
to between $5 million and $25 million.
  The Dingell substitute does not repeal PUHCA. The bill before us does 
repeal the Public Utility Holding Company Act, but the bill before us 
keeps in order the reporting requirements under PUHCA so the SEC would 
have the ability to maintain analysis of records and things like that 
of the companies that are subject to PUHCA.
  The Dingell substitute would require retroactive refunds for market-
based rates. It would go back into contracts that have already been 
executed and electricity is being consumed and money for that 
electricity has been paid, and for the first time create a retroactive 
refund. I think that is unwise and unnecessary.
  Basically, I would say that the Dingell substitute is well 
intentioned; but in some cases it goes too far, and in some cases it is 
silent on the underlying bill. I would hope we would oppose it and keep 
the base text of the bill that is before us.
  Madam Chairman, I reserve the balance of my time.
  Mr. DINGELL. Madam Chairman, I yield 2 minutes to the gentleman from 
Virginia (Mr. Boucher).
  Mr. BOUCHER. Madam Chairman, I thank the gentleman from Michigan (Mr. 
Dingell) for yielding me this time, and I want to commend the gentleman 
for bringing this very important substitute for the electricity title 
in the bill before the House this afternoon. I strongly support the 
substitute for the electricity provisions in the bill put forward by 
the gentleman from Michigan (Mr. Dingell).
  The Dingell amendment would improve current law in a number of ways. 
It would enhance the FERC's ability to deter and punish parties that 
engage in fraudulent activities that harm consumers. It would create 
reporting requirements based on the record-keeping requirements under 
the Federal securities laws for all wholesale energy transactions. It 
would increase civil and criminal penalties under the Federal Power Act 
modeled on the penalties established in the Sarbanes-Oxley law. It 
would direct the FERC to review approved market-based rates on an 
annual basis to remain sure that they are fair and reasonable as 
circumstances change.
  Unfortunately, one of the things that we have learned during the last 
few years is that the energy markets are ripe for manipulation. The 
Dingell substitute would modernize our laws to give the FERC the 
necessary tools to prevent and, if necessary, punish the entities that 
engage in fraudulent conduct.
  In addition to the strong consumer protection and antifraud 
provisions, the Dingell amendment also retains the less controversial 
and very useful parts of the electricity title, including the much-
needed reliability provisions for transmission lines, the net metering 
and smart metering provisions and FERC Lite, to name other provisions.
  The Dingell substitute would be a positive addition to the Federal 
law, ensuring that wholesale electricity markets operate in an 
efficient and equitable manner. I strongly support the Dingell 
substitute and urge its approval by the House.
  Mr. BARTON of Texas. Madam Chairman, I yield 2 minutes to the 
gentleman from New Hampshire (Mr. Bass), a member of the committee.
  Mr. BASS. Madam Chairman, I rise in opposition to the amendment 
offered by the gentleman from Michigan (Mr. Dingell). Basically, this 
guts the whole bill. It substitutes a power act amendment for the 
entire bill. It, frankly, goes far beyond anything being considered 
currently in the electricity debate, particularly with respect to 
utility security, FERC rate-making authority, reporting requirements, 
and industry accounting.
  In addition, this amendment would fundamentally rewrite portions of 
the Natural Gas Act, something that is clearly outside the scope of 
this debate. I point out that the amendment is opposed by the Edison 
Electric Institute, the American Public Power Association, and the 
National Rural Electric Cooperative Association. Those are the co-ops.
  It does not help site new transmission that is needed to ensure 
reliability and provide adequate supplies of affordable electricity to 
consumers. It does not repeal PUHCA, which facilitates the construction 
of new construction and promotes badly needed investment in the 
electric utility industry. It does not amend PURPA to reform the 
contract process and save constituents money, and it does not promote 
certainty of contract that is necessary to promote investment and 
better market operation by putting all market-based contracts at risk. 
It does not provide FERC the flexibility needed to regulate markets 
that develop in the future by issuing prescriptive rules, procedures, 
and penalties.
  What the amendment does do, unfortunately, is create market 
uncertainty, it imposes excessive penalties, and it institutes almost 
continuous investigation of all utilities with market-based rates, not 
only burdening utilities, but also burdening FERC and stretching its 
resources.
  Madam Chairman, I hope that the Congress will join me and other like-
minded colleagues in opposing this amendment.

[[Page 7259]]


  Mr. DINGELL. Madam Chairman, I yield 2\1/2\ minutes to the 
gentlewoman from California (Ms. Eshoo).
  Ms. ESHOO. Madam Chairman, I want to speak to one aspect of this very 
important consumer protection amendment, and that is what the amendment 
is: it protects consumers. The issue I want to talk about is refund 
authority.
  Can there be any doubt today that Western consumers were gouged as a 
result of energy market manipulation in 2000 and 2001? Can there be any 
doubt that refunds are owed? So when a Member rises on the floor and 
talks about retroactive and it is not fair to have something 
retroactive, we have to have the arm of the law reach back so consumers 
are refunded the dollars that they were ripped off.
  Madam Chairman, 5 years after the crisis in California, no refunds 
have been ordered because for 5 years the Federal Energy Regulatory 
Commission has insisted it does not have the authority to order the 
retroactive refunds that will fully compensate consumers. FERC knows 
the evidence, and here it is: one, Enron memos reveal that the energy 
trading company implemented elaborate market manipulation strategies to 
drive up prices. The Enron memos gave these ploys names like Fat Boy, 
Death Star, and Get Shorty.
  Number two, audio tapes of Enron energy traders surfaced that 
confirmed the existence of secret deals with power producers that 
deliberately drove up prices by ordering power plants shut down.
  Number three, transcripts of Reliant Energy traders from 2000 
revealed that Reliant power plant operators deliberately kept power 
offline in order to increase energy prices at the height of the crisis.
  Four, on March 3, 2003, a coalition of California governmental 
entities and public utilities presented the FERC with more than 1,000 
pages of evidence documenting a ``pervasive pattern of market 
manipulation that resulted in disastrous effects on prices and 
reliability.'' And in March 2003, the FERC confirmed that significant 
power manipulation had taken place in the West.
  This amendment gives the FERC broad authority to order retroactive 
refunds for market-based rates that are not just and reasonable. For 
California, billions are at stake. I urge a vote for this amendment. 
Last fall Governor Schwarzenegger said, ``Californians deserve refunds 
to fairly compensate them for the excessively high prices they paid 
during the energy crisis.''
  Mr. BARTON of Texas. Madam Chairman, I yield myself such time as I 
may consume for the purpose of responding to the gentlewoman from 
California (Ms. Eshoo) and also to enter into a colloquy with the 
gentleman from New Hampshire.
  First, let me simply say I understand the concern of the gentlewoman 
from California (Ms. Eshoo) about the situation in the power markets in 
California 4 to 5 years ago, and I know she feels more needs to be 
done. As we speak, there is litigation in process to have more done in 
that area.
  I will say on the record, hundreds of millions, if not billions, of 
dollars have been reclaimed, indictments have been brought, cases have 
gone to court and convictions obtained and people sent to jail for some 
of the transgressions the gentlewoman alluded to.

                              {time}  1730

  While it is obvious that she feels more needs to be done, I think it 
does need to be stated on the record that quite a bit already has been 
done.
  Madam Chairman, I yield to the gentleman from New Hampshire (Mr. 
Bass).
  Mr. BASS. I thank the gentleman for yielding.
  Madam Chairman, over the past several months, the gentleman from 
Texas and I have worked toward a fair and equitable solution to the 
problem of contamination caused by MTBE getting into our groundwater 
and other waters. I appreciate all his efforts and the faith he has 
placed in me on this issue which is so critical to New Hampshire, a 
State that has been affected significantly and, obviously, other 
affected States.
  Like him, I had hoped that we would be able to have our solution 
ready for today's House consideration of the Energy Policy Act. 
However, I am not satisfied that what we have agreed upon in principle 
is sufficient to the problem or comprehensive enough to have my 
support, and I would rather not rush it simply for the sake of being 
done today.
  Does the gentleman agree that spending additional time will result in 
an improved product that will provide a mechanism to ensure that our 
drinking water is clean and safe today and into the future?
  Mr. BARTON of Texas. Madam Chairman, I agree with the gentleman from 
New Hampshire. He and I have been working toward a solution to the 
contamination problem in New Hampshire and across the Nation. If he is 
not satisfied with the solution thus far, then I am not satisfied with 
it either, and I agree with him that more must and will be done.
  With the time that we will have to continue our already significant 
progress, I appreciate his commitment to reach out to other Members 
with similar problems like his. Committee staff and I stand ready to 
assist in every way and are fully committed to resolving the problem 
before the bill is presented to the President for enactment.
  Mr. BASS. I thank the gentleman for those comments.
  Does the gentleman also agree that the principles we have established 
so far, including a fair funding system, strict cleanup standard and an 
appropriate amount of time for contamination discovery will be 
safeguarded in the final product unless equivalent mechanisms can be 
developed?
  Mr. BARTON of Texas. I agree with that statement, also. The 
principles the gentleman has outlined should be part of the solution. I 
am confident that our work will adequately satisfy New Hampshire and 
other contaminated States with problems similar to his State's.
  Madam Chairman, I will just say that we are in opposition to the 
Dingell substitute and would urge a ``no'' vote at the appropriate 
time.
  Madam Chairman, I yield back the balance of my time.
  The CHAIRMAN. Without objection, the gentleman from Massachusetts 
(Mr. Markey) will control the balance of the time.
  There was no objection.
  Mr. MARKEY. Madam Chairman, I yield myself 1\1/2\ minutes.
  The provisions which are in the bill already are good. It is that 
they just do not go far enough to deal with this electricity crisis 
that we saw that went across the country.
  What the Dingell amendment does is very simple. It creates an 
antifraud authority at the Federal Energy Regulatory Commission with 
tough, new criminal and civil penalties. It ensures, in other words, 
that they can get the real job done.
  It also provides real transparency on pricing and trading of 
electricity in this marketplace. It also prohibits self-dealing, 
interaffiliate dealing. All of the kinds of activities which were 
identified in the aftermath of the Enron and the related scandals is 
prohibited; and the authority is given to the FERC in order to make 
sure that they get the job done. This is the needed final piece to make 
sure we do not see a repetition of what happened at Enron.
  Vote ``aye'' on the Dingell amendment.
  Madam Chairman, I yield the balance of my time to the gentleman from 
Michigan (Mr. Dingell).
  Mr. DINGELL. Madam Chairman, if my colleagues want a replication of 
Enron and the abuses, the stealing, the dishonesty that hurt 
pensioners, retirees, shareholders, others in the industry, hundreds 
and hundreds of ratepayers and hurt the structure of the States in the 
western United States, then vote against this amendment.
  This amendment stops self-dealing. This amendment requires that there 
be repayment of money wrongfully taken. It allows FERC and the SEC to 
provide the necessary steps that will stop Enrons and others like Enron 
from doing what Enron did, which caused such desperate hurt to millions 
of

[[Page 7260]]

Americans in the western United States.
  My amendment does go further than anything else being considered. 
Enron's abuses went further than anyone expected, far beyond, and they 
shook the entire electric industry. But it also hurt consumers, States, 
and also retirees and pensioners and shareholders.
  This amendment will stop that abuse. I urge my colleagues to vote for 
it.
  The CHAIRMAN. The question is on the amendment offered by the 
gentleman from Michigan (Mr. Dingell).
  The question was taken; and the Chairman announced that the noes 
appeared to have it.
  Mr. DINGELL. Madam Chairman, I demand a recorded vote.
  The CHAIRMAN. Pursuant to clause 6 of rule XVIII, further proceedings 
on the amendment offered by the gentleman from Michigan (Mr. Dingell) 
will be postponed.
  It is now in order to consider amendment No. 3 printed in House 
Report 109-49.


                 Amendment No. 3 Offered by Mr. Markey

  Mr. MARKEY. Mr. Chairman, I offer an amendment.
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 3 offered by Mr. Markey:
       Strike title XXII.

  The CHAIRMAN. Pursuant to House Resolution 219, the gentleman from 
Massachusetts (Mr. Markey) and the gentleman from California (Mr. 
Pombo) each will control 15 minutes.
  The Chair recognizes the gentleman from Massachusetts (Mr. Markey).
  Mr. MARKEY. Madam Chairman, I yield myself 3 minutes.
  The Arctic National Wildlife Refuge is a national treasure, a place 
of ancient wilderness that remains much the same as it was at the end 
of the last Ice Age. It is one of the few places remaining in America 
where man has not scarred the land. It is a place where roads do not 
pave the way and where the animals truly do roam free. The refuge is 
home to the 130,000-strong porcupine caribou herd as well as polar 
bears, musk oxen and even more than 130 species of migratory birds.
  All wildlife refuges have, by bipartisan consensus, been set aside to 
ensure that a few special places, natural places, will not succumb to 
the pressures of commercial exploitation. The Arctic refuge is one of 
the most unique wild and irreplaceable refuges of all. If we allow the 
oil and gas drillers into this refuge, we might as well say good-bye to 
protection of all 544 refuges in this country.
  The Arctic National Wildlife Refuge is the crown jewel of the 
wildlife refuge system in the United States. Of those 544 refuges, it 
is estimated that 60 percent of them have the potential for oil and gas 
development. Overturning the 39-year precedent of never leasing a 
wildlife refuge to the oil companies where leases did not previously 
exist will set in motion a series of events that will endanger each of 
the other 543 refuges spread throughout the States and districts of the 
Members of this body.
  Besides the wildlife refuges, drilling in the Arctic refuge is widely 
seen as the first step in lifting the moratoria on drilling on the 
outer continental shelf of the Atlantic and Pacific coasts, 
specifically in Florida and California.
  The chairman of ExxonMobil recently said that drilling in the Arctic 
refuge is representative of the broader issue of whether drilling will 
be allowed in other environmentally sensitive places such as the coasts 
of California and Florida. In a 2003 speech to the Republican Caucus, 
House Majority Leader Tom DeLay proclaimed the issue of the Arctic 
refuge is about precedent and repeatedly referred to its symbolism.
  Matthew Simmons, an oil industry banker and former Bush adviser, 
recently told the New York Times that if you cannot do ANWR, you will 
never be able to drill in the promising areas.
  Ladies and gentlemen, this is a huge test for us. The Republican 
majority has decided not to do anything about making SUVs and 
automobiles more fuel efficient, and that is where 70 percent of all 
gasoline, all oil, goes, into those gasoline tanks. Instead of making 
those vehicles more efficient, what they have decided to do is to 
construct a gasoline station on top of the Arctic Wildlife Refuge in 
order to fuel those inefficient vehicles. We must stop them.
  Madam Chairman, I reserve the balance of my time.
  Mr. POMBO. Madam Chairman, I yield 2 minutes to the gentleman from 
Texas (Mr. Gene Green).
  Mr. GENE GREEN of Texas. Madam Chairman, I thank the chairman of the 
Committee on Resources for yielding me this time.
  This is a perennial amendment we have. This energy bill provides for 
production, conservation and research, but ANWR is one of the most 
important production parts. Granted we cannot produce ourselves out of 
these high energy prices, but we have to produce in our own country if 
we ever expect to lower the prices.
  Our Nation needs more energy. Our economy, consumers and workers bid 
against China, Europe and India's economies for every barrel of Middle 
Eastern, African and Venezuelan oil. The Congress so far has refused to 
open promising offshore areas to exploration, even as Cuba, employing 
Spanish and Chinese energy companies, is drilling 60 miles from the 
Florida Keys, much closer than we allow American companies to do.
  No nation can produce energy more responsibly than ours. Energy 
production is not like it used to be 50, 25 or even 10 years ago. It is 
much cleaner and much more scrutinized. Supporting only long-term 
solutions and conservation is important, but not enough. Our cars get 
25 percent of their gas from U.S. lands, but our children will see even 
less if we do not produce at home.
  Two-thirds of the world's oil reserves are in the Middle East, 
controlled by OPEC. If they act as a cartel, they will control the 
world price of oil for the foreseeable future. If we allow domestic 
production to die out, conservation and research will not save us and 
we will have to pay a terrible economic price.
  If we allow production in ANWR, we will see great benefits at a very 
low, temporary cost and see thousands of good-paying jobs created over 
the next 25 years. The caribou, bears, birds and other wildlife can 
thrive just as they have at Prudhoe Bay. Tanker accidents will be 
prevented by new, double-hulled oil tankers and environmental impacts 
overall will be much less.
  Drill sites are much smaller today and we use fewer wells with our 
new drilling technology. Permanent gravel roads are no longer necessary 
if we use the winter ice road. The doom and gloom scenarios by 
opponents of ANWR oil are inaccurate and not based on reality. I have 
been there many times, Madam Chairman, and I can tell you that we can 
produce it and the bears and the caribou will be in ANWR just like they 
are in Prudhoe Bay.
  Mr. MARKEY. Madam Chairman, I yield 1\1/2\ minutes to the gentlewoman 
from California (Ms. Lee).
  Ms. LEE. Madam Chairman, first, let me just say, I want to thank the 
gentleman from Massachusetts (Mr. Markey) for yielding me the time, for 
his leadership and the gentlewoman from Connecticut (Mrs. Johnson) for 
her leadership in making sure that this is a bipartisan amendment. 
Opening up the Arctic National Wildlife Refuge to oil and gas drilling 
is not the answer to our long-term energy or security needs.
  The fact is, we are addicted to oil. The proponents of this bill 
would have you believe that the only way to cure an addict is to feed 
the addiction at whatever cost, regardless of the effect on the 
environment, on our wildlife, and on our public health.
  As a psychiatric social worker by profession, I can tell you this 
does not work. We should be working to reduce our dependency by 
promoting energy efficiency and energy conservation, and funding 
research to develop and utilize clean and renewable sources of energy. 
By allowing drilling in the Arctic refuge, we are spoiling a pristine 
natural environment, we are furthering our dependence on oil, and we 
are contributing to high levels of asthma, such as in my own district 
in west Oakland and throughout the country.

[[Page 7261]]

  Reducing dependencies on alcohol and on drugs leads to individuals 
leading clean and sober lives. Our country needs to reduce its 
dependency on oil, for a clean and sober and independent future is what 
our children deserve.
  Mr. POMBO. Madam Chairman, I yield 2 minutes to the gentleman from 
Nevada (Mr. Gibbons).
  Mr. GIBBONS. Madam Chairman, as I rise to the podium here, I want to 
bring up a poster which shows what this Arctic National Wildlife Area 
really is. First of all, let me say that the Arctic National Wildlife 
Refuge is 19.5 million acres of Alaska, set aside in 1960. Also in 
1960, they set aside 1.5 million acres for exploration for oil. That is 
called the area 1002 part of ANWR.
  This is area 1002. This is the area we are going to be drilling on 
for oil and gas. As you can see, no big trees, no big mountains, no big 
herds of anything. It is just frozen tundra out there.

                              {time}  1745

  But the 1002 area will continue to provide, as the USGS has already 
said, an estimated oil reservoir for this country that will equal the 
amount of oil we will get from Saudi Arabia for 30 years, Madam 
Chairman; 10.4 billion barrels would make it the largest oil reserve 
find in the world since the nearby Prudhoe Bay discovery was done 30 
years ago.
  Madam Chairman, the area 1002 is not a wilderness. It is part of ANWR 
set aside 18 years ago for oil and gas exploration. This is where this 
2,000-acre surface disturbance is going to take place. We are not 
talking about a pristine wilderness area that one would find in any of 
the southern 48 contiguous States that have forests.
  So with that, Madam Chairman, I just wanted to bring to the Members' 
attention that this is not the pristine wilderness that most people 
have in mind. This is a frozen tundra that we are going to disturb only 
2,000 acres of it, and from there we are going to provide this country 
with nearly 10 billion barrels of new oil to meet the needs of this 
country's energy demands.
  Mr. MARKEY. Madam Chairman, I yield 1 minute to the gentleman from 
Minnesota (Mr. Kennedy).
  Mr. KENNEDY of Minnesota. Madam Chairman, I rise to support this 
amendment.
  Since coming to Congress, I have been committed to the need to 
maximize our domestic energy resources. However, I firmly believe that 
we must pursue domestic energy independence in a manner that protects 
our natural resources like the Arctic National Wildlife Refuge. Instead 
of opening up ANWR to oil drilling, I believe that we should look to 
new sources and new technologies to increase our energy independence.
  I am proud to say that my State of Minnesota is a leader in the field 
of renewable energy such as ethanol, biodiesel, and wind energy. 
Minnesota companies offer innovative technologies to reduce our energy 
needs. These renewable energy sources and technologies offer a sensible 
alternative to help reduce our reliance on foreign sources of oil 
without endangering our environment. That is why I support the Markey-
Johnson amendment and urge my colleagues to do the same.
  Mr. POMBO. Madam Chairman, I yield 4 minutes to the gentleman from 
Alaska (Mr. Young), chairman of the Committee on Transportation and 
Infrastructure.
  Mr. YOUNG of Alaska. Madam Chairman, I want to thank the gentleman 
from California (Chairman Pombo) and the gentleman from Texas (Chairman 
Barton) for their fine work on a good piece of legislation that starts 
our process in becoming independent, providing energy policy, which I 
have heard none from the other side. Remarkably, when I hear people 
talking about new innovative ideas, they do not tell me what ``new'' 
is.
  We are fossil-fuel oriented, and I will admit to that. And we are 
also dependent, and we have to admit to that. And we are talking about 
an area that is not pristine, an area, in fact, that should be 
developed that is 74 miles from the pipeline, an area that we have 
developed already in Prudhoe Bay, and we can see the great damage that 
is done up there. The caribou are using the pipeline to rub their backs 
on. The caribou are calving around the wells. The gentleman from 
Massachusetts (Mr. Markey) has never been there; so he would not know. 
And we have polar bears now that are using the line for a 
transportation corridor.
  So, Madam Chairman, those who would support the Markey amendment are 
really supporting terrorism because you do not want to develop the 
domestic fuel supply in this country, and we can. We should be doing 
this right now. And I hear people tell me it will only affect us 10 
years from now. If you had done it when I asked you to do it 20 years 
ago, we could have solved that problem.
  The thing that sort of strikes me the most is I hear people talk 
about special interests. In fact, the gentleman from Massachusetts (Mr. 
Markey) mentioned it today about special interests, serving up special 
interests. But I would like to just read a little short letter that I 
happened to pick up off a Web site. It says: ``Dear friend, in a few 
short hours the Republican energy bill will be brought up for debate 
and a vote on the floor of the House of Representatives. I need your 
immediate help to ensure that this terrible bill never becomes law.
  ``Last week in the Committee on Energy and Commerce, I offered a 
series of amendments to increase the average fuel efficiency'' and it 
was turned down by the Republicans.
  ``I then offered an amendment in the Committee on Resources to strip 
a provision from the bill that would open the Arctic National Wildlife 
Refuge for oil drilling.'' The Republicans again voted against it.
  ``If we allow drilling in the Arctic National Wildlife Refuge we will 
forever ruin this unique wilderness and allow the oil industry to 
target all 450 National Wildlife Refuges . . .
  ``For the last 5 years, I have led the battle in the House to stop 
the Republicans in the Congress from selling off one of our greatest 
natural resources to the powerful special interests. Help me continue 
to fight to expose to the American people the dangers of this extreme 
and ineffective action by making a contribution today.''
  Just, by the way, dial in to www.edmarkey.org/contribute. That is a 
special interest.
  ``Help me to continue to fight for sensible, clean and independent 
energy future and shine a light on the Republican Party backroom 
attempts to cater to special interests by making an immediate 
contribution. As Justice Louis Brandeis used to say, `Sunshine is the 
best disinfectant.'''
  This is a blatant use of an issue to raise money, and you ought to be 
ashamed of yourself. To raise money on an issue that has nothing to do 
with energy, energy that this country needs. We are no longer the only 
buyers on the block in this world with China and India in the field. 
And if we do not wake up, we will have a collapse in our economy. We 
must develop not only ANWR but other sources of fossil fuels in this 
country as well as nuclear and as well as hydro and as well as wind and 
all those other forms of energy and quit talking about pipe dreams, 
because if we do not, there will not be the jobs for the future 
generations and this country cannot lead this world. And to have 
someone stand on this floor and offer an amendment that will take out 
the only provisional production is against America, against this great 
Nation, and, in fact, would do the wrong thing for this Nation.
  So I ask Members to vote ``no'' on the Markey amendment. Keep this 
good bill intact. Let us produce energy for this Nation. Let us provide 
for future generations.
  Mr. MARKEY. Madam Chairman, I yield 1 minute to the gentlewoman from 
California (Ms. Woolsey).
  Ms. WOOLSEY. Madam Chairman, I want to commend my colleagues for 
offering this sensible amendment.
  We should not even be having this discussion because drilling in ANWR 
will not make us energy independent and it will not end our Nation's 
reliance on Middle East oil. Drilling in ANWR will do little to reduce 
our current dependence on foreign oil because

[[Page 7262]]

it will take more than 10 years, yes, more than 10 years to process 
what little oil may be there. In fact, if we spent half the time 
promoting legislation that encourages the use of renewable energy that 
we have discussing drilling in ANWR, we would be close to developing a 
sensible energy policy that would ensure real energy independence. We 
would invest in alternative renewable clean energy, conservation, and 
efficiency.
  That is why I will support this sensible amendment, and I encourage 
my colleagues to do the same.
  Mr. POMBO. Madam Chairman, I yield 2 minutes to the gentleman from 
Texas (Mr. Barton), chairman of the Committee on Energy and Commerce.
  Mr. BARTON of Texas. Madam Chairman, I thank the gentleman from 
California for yielding me this time.
  First, let me say that I do oppose the Markey amendment, but I want 
to say that the letter that was just read is totally legal. He has got 
every right if he wants to use something to try to raise money. He did 
not send me that letter. Had he sent it to me, I would have had to 
reply in the negative that I could not make the contribution. But I 
recognize his right to do it in that manner.
  I oppose the Markey amendment because I want to pay less for gasoline 
in Texas. I would like to tell the Members that my great State is self-
sufficient in energy production and self-sufficient in oil, but it is 
not true. We are the largest producer of oil of the 50 States, but we 
are also the largest consumer.
  ANWR has the potential to produce up to 2 million barrels a day for 
30 years. And depending on one's point of view, that is a lot or a 
little. If one wants to say it is a lot, it is more than we import from 
Saudi Arabia. If one wants to say it is a little, it is less than we 
use in a year in this country. But 2 million barrels a day for 30 years 
would lower prices for every American at the pump.
  I would point out that in terms of the environment, we have been 
producing successfully in Prudhoe Bay for almost 30 years without any 
harm to the environment, as the gentleman from Alaska (Chairman Young) 
showed in those pictures when he was up here right before me.
  My district produces substantial amounts of oil and gas. We are 
producing 1.5 billion cubic feet of gas every day. That is one half of 
a trillion cubic feet a year. I cannot tell the Members how many 
hundreds of thousands of barrels of oil per day, but we are producing 
significant amounts of oil. We are producing it through the water table 
and supplies of many of the cities that I represent. We are producing 
it from underneath downtown Fort Worth, Texas. And we are doing it in a 
safe and environmentally effective fashion. We could do that also in 
ANWR. I strongly support the gentleman from California's (Chairman 
Pombo) amendment that would allow it.
  I want to thank our colleagues in the other body for already agreeing 
in the reconciliation instructions, and I urge a ``no'' vote on the 
Markey amendment.
  Mr. MARKEY. Madam Chairman, I yield 1 minute to the gentleman from 
Ohio (Mr. Kucinich).
  Mr. KUCINICH. Madam Chairman, I have the greatest respect for the 
gentleman from Alaska (Mr. Young), and I simply have a difference of 
opinion with him on this despite that great respect.
  In what has become a congressional ritual, the prospect of drilling 
in the Arctic has been repeatedly struck down in recognition of the 
fact that American working families do not want it. Still, we have 
proponents telling us that drilling is good for jobs.
  Some of the Nation's largest unions, I might point out, like the 
SEIU, United Auto Workers, United Steelworkers, and United Farm 
Workers, are on record opposing drilling in the Arctic Refuge. Why? 
Because it is bad labor policy. Oil production is one of the least 
labor-intensive industries, supporting fewer than three direct jobs per 
$1 million of investment. Energy efficiency supports 27 jobs for the 
same investment.
  It is also bad economic policy. One dollar spent on petroleum 
production creates only $1.51 in economic value. But that same dollar, 
when invested in energy efficiency, creates $2.23 in economic value.
  Our Nation's energy policy should not include drilling in the Arctic.
  Mr. POMBO. Madam Chairman, I yield 1\1/2\ minutes to the gentleman 
from California (Mr. Nunes).
  Mr. NUNES. Madam Chairman, I had an opportunity to go up to and visit 
in Alaska the gentleman from Alaska's (Chairman Young) district. And I 
find it really interesting to hear the opposition to this bill because 
when I went up there, I envisioned that I would see trees, running 
water, big mountains, things that the American people would want to 
preserve. However, when I got there, I found nothing but tundra. And it 
was just kind of a wasteland of ice and tundra.
  And as the American people are paying upwards of $2.50 a gallon for 
fuel today and we sit in the white building on Capitol Hill, I wonder 
what they are thinking out there.
  This should have been opened long ago. We could get 10 percent of our 
daily supply from ANWR. But I believe that the radical environmental 
groups have been using this as a fund-raising tool for their 
organizations because what they say is in ANWR and what we see when we 
get there does not exist. And now I think the fund-raising has 
continued. Unfortunately, though, it has spread here to the halls of 
Congress. And with all the ethics charges that are being brought today 
by the Democrats, I find it very interesting that the author of this 
amendment sends out a fund-raising letter, and I have the fund-raising 
letter right here that, that asks people to contribute today. And I 
would like to submit this for the Record, Madam Chairman, because this 
is outrageous when people are paying $2.50 a gallon and the Democrats 
and the radical environmental groups are using this as a fund-raising 
tool.

       Dear Friend: In a few short hours, the Republican Energy 
     Bill will be brought up for debate and a vote on the floor of 
     the House of Representatives. I need your immediate help to 
     ensure that this terrible bill never becomes law.
       Last week, in the Energy and Commerce Committee, I offered 
     a series of amendments to increase the average fuel 
     efficiency of cars, mini-vans and SUVs. Each of these 
     amendments was voted down by the Republican majority on the 
     Committee, ensuring that the most technologically advanced 
     nation in the world will continue to ignore energy 
     conservation and not diminish its demand for oil. Why is it 
     that we can send a man to the moon and beyond but cannot make 
     our cars more efficient? This is auto mechanics, not rocket 
     science.
       I then offered an amendment in the Resources Committee to 
     strip a provision from the bill that would open the Arctic 
     National Wildlife Refuge for oil drilling. The Republicans on 
     that committee voted against my amendment, choosing to set up 
     a gas station in this pristine National Refuge.
       If we allow drilling in the Arctic National Wildlife 
     Refuge, we will forever ruin this unique wilderness and allow 
     the oil industry to target all 540 National Wildlife Refuges 
     for drilling and exploitation--all for a few meager months 
     worth of oil. Furthermore, drilling in the Refuge is 
     completely unnecessary. If we were to increase the average 
     fuel efficiency of cars, mini-vans and SUV's by only three 
     miles per gallon, we would conserve more oil in ten years 
     than could ever be produced by drilling in the Arctic 
     National Wildlife Refuge.
       For the last five years I have led the battle in the House 
     to stop the Republicans in Congress from selling off one of 
     our greatest natural treasures to the powerful special 
     interests. Help me continue to fight to expose to the 
     American people the dangers of this extreme and ineffective 
     action by making a contribution today.
       Today, I will offer these amendments again on the House 
     floor. This series of votes is a critical moment for our 
     country's energy future. I need your help now to expose the 
     travesty of this Republican energy plan and ensure that this 
     horrendous bill, rife with handouts to the special interests, 
     is ultimately defeated. If this bill passes, we will create 
     more pollution, forever spoil one of our most important and 
     beautiful public lands and be forced to continue placing our 
     soldiers in harm's way in defense of oil in the Middle East.
       Help me continue to fight for a sensible, clean and 
     independent energy future and shine a light on the Republican 
     Party's backroom attempts to cater to the special

[[Page 7263]]

     interests by making an immediate contribution. As Justice 
     Louis Brandies used to say, ``sunshine is the best 
     disinfectant.''
           Thank your for your action,
                                                         Ed Markey

  Mr. MARKEY. Madam Chairman, I yield 1 minute to the gentleman from 
Washington State (Mr. Inslee).
  Mr. INSLEE. Madam Chairman, the gentleman from Alaska (Mr. Young) 
asked a very important question: Where are the technologies that we can 
use to avoid having to destroy the character of one of our most 
pristine areas in America?
  And the answer is that we have technologies today that we simply 
stopped using 20 years ago.

                              {time}  1600

  If you look at this graph, it shows the mileage of our cars that we 
have. You see, starting in 1975 it went up dramatically because we had 
a bipartisan consensus to demand to use existing technologies to 
improve our automobile efficiency. It went up dramatically, almost 
doubling, almost doubling by 1985.
  And then what happened? We fell off the wagon, and since that time, 
our average full economy shown by this middle line has absolutely, 
absolutely gone down since 1985.
  The fact of the matter is, these are not future techno dreams that 
someone has dreamed up in their garage somewhere; they are technologies 
that exist today. I drive a car that gets 44 miles to the gallon. I am 
6'2", 200 pounds; it is totally safe and comfortable.
  We need to get back on the fuel efficiency wagon as we were in the 
1980s on a bipartisan basis and not put a mustache on the Mona Lisa. 
You say 2,000 acres? It is still a mustache on the Mona Lisa for our 
most pristine areas.
  Mr. POMBO. Mr. Chairman, I yield 1 minute to the gentleman from Texas 
(Mr. Burgess).
  Mr. BURGESS. Mr. Chairman, I thank the gentleman for yielding me this 
time.
  Mr. Chairman, I rise today in opposition to the Markey amendment.
  Of course, energy independence should be the goal of this Congress. 
Worldwide demand for petroleum has increased in the last decade. Our 
production has been relatively flat.
  The inevitable result is higher prices at the gasoline pump. The 
reality is, it takes a long time to go from the oil field to the 
gasoline station, and we have lost considerable time in this regard.
  Ten years ago, 1995, 104th Congress, H.R. 2491 would have allowed oil 
exploration in the ANWR. The Department of Energy has estimated, and 
the chairman quoted today, between 1 and 2 million barrels of oil a day 
could be derived from this source.
  Unfortunately, this legislation, passed by the House and the Senate, 
was vetoed by President Clinton. That was nearly 10 years ago. Given a 
time line of 7 to 14 years for building a pipeline structure, it is 
time that we could scarcely afford.
  Just like the other gentleman from California, I have been to ANWR. 
The vast coastal plain is unsuitable for habitation during the summer 
months because of the marshy consistency. Any caribou unlucky enough to 
calve in this region would likely die from exsanguination at the hands 
of the mosquitoes there.
  The people in ANWR are counting on this Congress to do the right 
thing and allow them, the rightful owners of these mineral rights, to 
begin developing the sources that were granted to them upon statehood 
in 1959.
  Mr. MARKEY. Mr. Chairman, I yield 1 minute to the gentleman from New 
Mexico (Mr. Udall).
  Mr. UDALL of New Mexico. Mr. Chairman, I thank the gentleman from 
Massachusetts for his leadership on this issue.
  I see a far different place than the two gentlemen that have spoken 
before us from the opposition. When I went up to the Arctic National 
Wildlife Refuge, I saw a tremendously diverse area in terms of 
wildlife. I saw musk oxen, grizzly bears, Arctic char, and this 
marvelous caribou herd, which is the largest in North America, migrate 
to cross the area that we are talking about drilling in. So there is a 
far different area than is being described.
  One of the things that has not been mentioned here is, two native 
tribes depend on the migration of these caribou, and they have asked 
the Congress and they have asked the State of Alaska to stand up for 
them and to say, We do not want to have the destruction of this 
migration, because their livelihood depends on having caribou, and 
their entire existence rotates around that.
  So I would urge my colleagues to support the Markey amendment and 
vote down this dangerous energy bill.
  Mr. POMBO. Mr. Chairman, I reserve the balance of my time.
  Mr. MARKEY. Mr. Chairman, may I inquire of the Chair how much time is 
remaining.
  The Acting CHAIRMAN (Mr. Simpson). The gentleman from Massachusetts 
(Mr. Markey) has 5\1/2\ minutes remaining; the gentleman from 
California (Mr. Pombo) has 2\1/2\ minutes remaining.
  Mr. MARKEY. Mr. Chairman, I yield 3\1/2\ minutes to the gentlewoman 
from Connecticut (Mrs. Johnson).
  Mrs. JOHNSON of Connecticut. Mr. Chairman, I thank the gentleman for 
yielding me this time, and I rise in strong support of the Markey 
amendment.
  I consider this one of the most important environmental votes 
Congress will cast this year, the vote to protect the Arctic National 
Wildlife Refuge from oil and gas drilling.
  According to the U.S. Geographical Survey, this area would produce 
far less oil than the U.S. consumes in a single year, and is the only 
conservation area that protects a complete spectrum of Arctic and sub-
Arctic ecosystems in North America.
  The ecosystem will be seriously damaged by drilling in the ANWR, make 
no mistake about it. Roads, pipelines, drilling platforms and 
communities to support personnel all involve disturbing this critical 
natural habitat by moving a great deal of extremely heavy equipment 
across fragile lands, by locating multi-ton rigs and whole communities 
of people to support the drilling operation on this fragile land base.
  Drilling supporters claim that everything can be done in the refuge 
using ice roads and platforms. But even if ice roads did not melt in 
summer months, the reality is that there is simply not enough water in 
the refuge to create the roads and platforms necessary to drill in the 
ANWR refuge.
  Just building 1 mile of road takes a million gallons of water. There 
are only eight lakes scattered across the refuge containing enough 
unfrozen water to build a mile or more of ice roads. That means the 
only alternative truly is permanent gravel roads crisscrossing the 
refuge and, in fact, there is not one oil field in Alaska's North Slope 
that does not have permanent gravel roads.
  Some drilling supporters cite the central Arctic caribou herd as 
illustrating that the caribou and drilling can coexist harmoniously. 
But calving females have completely withdrawn from the drilling area 
around Prudhoe Bay and are declining around the Kuparak complex. While 
there is ample area for the central Arctic herd to move away from the 
drilling facilities for calving and still be supported, this is not the 
case for the porcupine caribou herd. They are a much larger herd and 
the coastal plain where they calve is much smaller. They would be 
displaced into the foothills where both they and their calves would be 
extremely vulnerable to predators.
  Finally, it would take a decade to deliver oil from the ANWR, and the 
amount, again, as I said earlier, would be very limited, according to 
the U.S. Geological Survey.
  On the other hand, the National Petroleum Reserve and other areas are 
capable of providing far more oil. In fact, the Federal Government, the 
State of Alaska, the Arctic Slope Regional Corporation, and others are 
in the process of leasing 50 million undeveloped acres in this region.
  We do not need to drill on the ANWR plain. If we were to increase the 
fuel efficiency of automobiles by just 3 miles per gallon, we would 
save a million barrels of oil a day, five times the amount we would get 
out of ANWR. Or,

[[Page 7264]]

if just California increased their use of currently available clean 
diesel technology cars, pickups and SUVs just to the levels seen in 
Europe today, just California could save 110 million gallons of 
gasoline by the year 2010.
  So this vote is not about oil, it is about our values and how we 
balance the value we place on a critical environmental resource and its 
ecosystems, and the value we place on exploration in a low-yield area. 
Indeed, it is about prudent stewardship.
  Mr. POMBO. Mr. Chairman, I reserve the balance of my time.
  Mr. MARKEY. Mr. Chairman, I yield myself the balance of the time.
  The Acting CHAIRMAN. The gentleman from Massachusetts has 2 minutes 
remaining.
  Mr. MARKEY. Mr. Chairman, this is a huge moment for this Congress. 
Inside of the Republican bill that we are voting on is a continuation 
of the $35,000 tax break to purchase Hummer IIs, a tax break to buy a 
Hummer II, $35,000. And then they turn with policies like that and they 
say, We need more gasoline in America. And they turn to an Arctic 
wildlife refuge as the first example of where they will go, rather than 
saying, Well, you know, if our country could put a man on the moon in 
1969, if we could deploy the Internet around the world in the last 15 
years, if we could craft a human genome, then maybe we could find a way 
to reinvent the automobile and the SUV so that it would average more 
than 23 miles per gallon, 1983s average; that is the average we have 
today.
  It is wrong, it is immoral for this Congress not to have any fuel 
efficiency standards for automobiles or SUVs in their bill, to continue 
tax breaks, giving incentives for Americans to purchase the most 
inefficient vehicles, and to then turn to the wilderness areas and say, 
We need the energy.
  America is great because its people are great, and what makes us 
great is we are technological giants. We have only 3 percent of the oil 
reserves in the world, but with our brains, we can make vehicles that 
are twice as efficient as the ones that we use today, if we put our 
minds to it. But the Bush administration and the Republican majority 
are completely and totally opposed to it. They reject it in their 
legislation today. Yet, they say they have a solution for the energy 
crisis in America.
  Well, you cannot put 70 percent of all of the oil in gasoline tanks, 
have no improvement in fuel economy standards, and then say you are 
solving the problem by going to wilderness areas and spoiling them.
  Vote ``aye'' on the Markey amendment.
  Mr. POMBO. Mr. Chairman, I yield myself the balance of the time.
  The Acting CHAIRMAN. The gentleman from California has 2\1/2\ minutes 
remaining.
  Mr. POMBO. Mr. Chairman, this is always a great debate that we have 
on the energy bill, and I always enjoy the rhetoric of the gentleman 
from Massachusetts (Mr. Markey) and his ability to speak to the issues 
that he is so passionate about.
  I have been to ANWR. I have been up there in the wintertime when it 
was 40 degrees below zero; I have been there when it was the summertime 
and it had warmed up to 32. And I agree with the gentleman from 
Massachusetts on one point, and that is that it is a very unique place 
that deserves to be protected. I believe that it is one of the most 
important areas that we have in Alaska, and throughout the country, 
because of its uniqueness.
  But the argument that the gentleman from Massachusetts (Mr. Markey) 
and those who support his amendment continue to make is that we have to 
choose between energy production and protecting our environment, and we 
do not. It is a false choice. We keep hearing this over and over again.
  Currently, there are about 120 wildlife refuges that have some kind 
of oil and gas development in them. This is not a wilderness area, as 
the gentleman from Massachusetts (Mr. Markey) keeps talking about, it 
is a wildlife refuge. And the area that we are talking about doing gas 
and oil exploration in was reserved by Congress for that purpose.
  We do not have to choose between having a vibrant economy, we do not 
have to choose between providing the energy resources for our country 
and protecting our environment. We can do both. There is no reason why 
we cannot.
  They talk about the 700,000 jobs that this will produce, and if it is 
that many, that is American jobs. But that is money that is being sent 
to foreign countries right now, that will be kept in this country. We 
have 3,000 union members that are on Capitol Hill today lobbying 
against the Markey amendment, because they know it means jobs to them. 
But they also know that it means that they will have to pay less in the 
future for gasoline than they would if the Markey amendment passes.
  This is an important amendment, because when we talk about energy 
independence, a big part of energy independence is developing our 
energy resources. It is not about all of these pie-in-the-sky ideas 
that we keep hearing about. What this is about is developing our own 
resources here at home, providing jobs here at home, and keeping 
hundreds of millions of dollars a year here at home. That is the effort 
that this committee is making; that is the effort that we put in.
  Passing the Markey amendment would be a huge mistake. If we had been 
able to do this before, we would be producing that oil now.
  Vote against the Markey amendment again.
  Mr. UDALL of Colorado. Mr. Chairman, I support this amendment.
  I think our colleagues from Connecticut and Massachusetts have very 
well explained why the amendment should be adopted.
  On that, I don't think there is a need to try to add to what they 
said except to say that the amendment will protect one of the most 
special places in our country without much real cost in terms of our 
ability to maintain needed energy supplies.
  But I do want to take just a moment to add a personal note.
  As Congress has debated this and similar energy bills, there has been 
some discussion of the history of the Alaska Lands Act and how its 
authors might vote if they were still Members of Congress.
  Some have even suggested that my father, Mo Udall, would oppose this 
amendment and support opening the coastal plain to drilling.
  That's an interesting thought. Of course, all we really know is that 
if things were different, they would be different.
  But I have my own opinion on the subject--and I think speculation 
along those lines is not based on history.
  I think that the prime sponsors of the Alaska Lands Act, including my 
father, would support the Markey-Johnson amendment.
  Of course, that isn't really the point, anyway--the real issue before 
us isn't about the past, but about the future.
  And it is up to us--not our predecessors--to decide, not just for 
ourselves but for our children and their children.
  But if people want to consider some words from the past, I would 
direct their attention to the original Committee report on the Alaska 
Lands Act, dated April 7, 1978.
  On page 149, the report points out that ``the Committee has noted the 
eloquent statements of a number of prominent Alaskans'' about the idea 
of building a pipeline across the coastal plain.
  ``For example,'' the report continues, ``Senator Ted Stevens . . . 
told the Council on Environmental Quality that `Some have appropriately 
compared [that idea] with slicing a razor lade across the face of the 
Mona Lisa.''
  I think that is a good summary of what could happen if we do not 
adopt this amendment.
  I am not saying that Senator Stevens would support the amendment--I 
am sure he wouldn't.
  I am saying that I think he aptly described what will happen if the 
coastal plain is opened to drilling.
  And that is why I will vote for this amendment, and why I urge its 
adoption by the House.
  Mr. CROWLEY. Mr. Chairman, this debate comes down to Fact v. Fiction.
  Fiction--The other side argues that drilling in pristine areas will 
lower gas prices.
  Fact--The President's top counselor Dan Bartlett said this week that 
there is no magic wand to reduce gas prices.
  Fiction--Opening ANWR will relieve the U.S. from turning to foreign 
sources.
  Fact--This bill makes our country more dependent on fossil fuels from 
places like the Mid-East as scientists of all ideologies have

[[Page 7265]]

stated that the limited amount of oil will not result in a lessening of 
oil dependency for the U.S.
  Fiction--Opening ANWR will weaken OPEC and strengthen the U.S.
  Fact--The Bush administration's own Department of Energy contradicts 
this point, when it determined last year that if world oil markets 
continue as they currently do, OPEC could ``countermand any potential 
price impact of Arctic Refuge production by reducing its exports by an 
equal amount?''
  Fact--Drilling in ANWR will not lower gas prices at the pump; will 
not protect our national sovereignty, and will not reduce our 
dependence on foreign oil.
  Fact--Vote for Markey-Johnson.
  Mr. SHAYS. Mr. Chairman, I rise in strong support of the Markey-
Johnson Amendment to protect the Alaska National Wildlife Refuge.
  The coastal plain of ANWR is the last major part of the North Slope 
that has not been developed. In my judgment, it would be far better to 
develop prudent and lasting alternate fuel energies than to risk 
irreparable damage to the wilderness of one of North America's most 
beautiful frontiers.
  The reason the ANWR ``solution'' seems so simple is because it's too 
good to be true. It won't fix our energy problems--with so little oil 
available up there, it couldn't possibly, as it will take a decade to 
get the oil down here. That time would be far better spent developing 
clean, renewable energy sources that will provide infinite energy 
without imperiling our last remaining wilderness areas. Even a modest 
increase in CAFE standards would save more oil than would be produced 
by drilling in ANWR.
  We simply won't have a world to live in if we continue our neglectful 
ways. What we really need to ask ourselves is: how can we square 
legitimate environmental concerns with our expanding energy needs?
  Mr. Chairman, drilling in the Arctic Refuge is the wrong answer to 
the right question. I urge my colleagues to vote yes on the Markey-
Johnson Amendment.
  The Acting CHAIRMAN. All time has expired.
  The question is on the amendment offered by the gentleman from 
Massachusetts (Mr. Markey).
  The question was taken; and the Acting Chairman announced that the 
noes appeared to have it.
  Mr. MARKEY. Mr. Chairman, I demand a recorded vote.
  The Acting CHAIRMAN. Pursuant to clause 6 of rule XVIII, further 
proceedings on the amendment offered by the gentleman from 
Massachusetts (Mr. Markey) will be postponed.

                              {time}  1815

  The Acting CHAIRMAN (Mr. Simpson). It is now in order to consider 
amendment No. 4 printed in House Report 109-49.


                Amendment No. 4 Offered by Mr. Boehlert

  Mr. BOEHLERT. Mr. Chairman, I offer an amendment.
  The Acting CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 4 offered by Mr. Boehlert:
       In title VII, at the end of subtitle E, add the following:

     SEC. 775. AVERAGE FUEL ECONOMY STANDARDS.

       (a) Purpose.--The purpose of this section is to seek to 
     save each year after 2014 10 percent of the oil that would 
     otherwise be used for fuel by automobiles in the United 
     States if average fuel economy standards remained at the same 
     level as the standards that apply for model year 2007.
       (b) In General.--Section 32902 of title 49, United States 
     Code, is amended by redesignating subsections (i) and (j) in 
     order as subsections (j) and (k), and by inserting after 
     subsection (h) the following:
       ``(i)  Standards for Model Years After 2007.--The Secretary 
     of Transportation shall prescribe by regulation average fuel 
     economy standards for automobiles manufactured by a 
     manufacturer in model years after model year 2007, that 
     shall--
       ``(1) ensure that the average fuel economy achieved by 
     automobiles manufactured by a manufacturer in model years 
     after 2014 is no less than 33 miles per gallon;
       ``(2) ensure that improvements to fuel economy standards do 
     not degrade the safety of automobiles manufactured by a 
     manufacturer; and
       ``(3) maximize the retention of jobs in the automobile 
     manufacturing sector of the United States.''.
       (c) Conforming Amendments.--Such section is further 
     amended--
       (1) in subsection (c)(1) in the first sentence by inserting 
     ``and subsection (i)'' after ``of this subsection''; and
       (2) in subsection (k) (as redesignated by subsection (a)) 
     by striking ``or (g)'' and inserting ``(g), or (i)''.

  The Acting CHAIRMAN. The gentleman from New York (Mr. Boehlert) and a 
Member opposed each will control 10 minutes.
  The Chair recognizes the gentleman from New York (Mr. Boehlert).
  Mr. BOEHLERT. Mr. Chairman, I yield 5 minutes to the gentleman from 
Massachusetts (Mr. Markey), and I ask unanimous consent that he be able 
to control that time.
  The Acting CHAIRMAN. Is there objection to the request of the 
gentleman from New York?
  There was no objection.
  The Acting CHAIRMAN. The gentleman from Massachusetts will be 
allotted 5 minutes and will control the 5 minutes.
  Does the gentleman from Michigan (Mr. Dingell) claim the time in 
opposition?
  Mr. DINGELL. I am opposed to the amendment.
  The Acting CHAIRMAN. The gentleman from Michigan (Mr. Dingell) will 
be recognized for 10 minutes.
  Mr. DINGELL. Mr. Chairman, I ask unanimous consent to yield 5 minutes 
to the gentleman from Michigan (Mr. Upton) and that he be permitted to 
yield as he might see appropriate amongst his colleagues.
  The Acting CHAIRMAN. Is there objection to the request of the 
gentleman from Michigan?
  There was no objection.
  Mr. BOEHLERT. Mr. Chairman, I yield myself 1 minute. Mr. Chairman, 
let me make several quick points. First, we cannot become less 
dependent on foreign oil unless we increase the fuel economy of our 
vehicles.
  We are importing 14 million barrels of oil every day. Cars and light 
trucks consume 9 million barrels of oil every day, and consumption is 
going up not down. We are on a collision course with disaster.
  Second, we have been losing ground on fuel economy. We use more gas 
to drive a mile today than we did 20 years ago. Third, this amendment 
would cut, would cut U.S. consumption by 2 million barrels a day by 
2020, more of a savings than any other single source in the bill.
  Fourth, the National Academy of Sciences said that full economy can 
be increased ``without degradation of safety.'' A representative of the 
Alliance of Automobile Manufacturers confirmed at a recent Science 
Committee hearing that I chaired that CAFE could be increased without 
compromising safety.
  Finally, the biggest beneficiary of this amendment will be the 
consumers. They are sick and tired of paying skyrocketing prices for 
gasoline, $40 to $50 to fill up. They want relief. This amendment 
offers them hope that we are doing something about it.
  Finally, support this commonsense science-based amendment that will 
help the Nation while leaving more money in consumer's pockets, theirs 
not ours.
  Mr. DINGELL. Mr. Chairman, I yield myself 1 minute.
  Mr. Chairman, I know the amendment is offered with the best of good 
will. It is nonetheless a bad amendment which is going to cost this 
country jobs. I urge my colleagues to oppose it.
  The amendment appears to say that it would only require CAFE to be 
fixed at 33. In point of fact, it would be required, because of the 
language in the amendment, to properly go to 36 miles per gallon. If 
you like driving around in small cars, this will assure that that will 
be all that you will have.
  I will point out who opposes it: AFL-CIO, Farm Bureau, United Auto 
Workers, National Automobile Dealers, and hundreds of consumers who buy 
comfortable cars which are big enough so that they can take their 
family around.
  The amendment would purport to have the agency which would fix fuel 
economy standards to in fact consider both jobs, safety and other 
questions like that. In point of fact, there is no requirement. So 
those requirements, in fact, are not requirements but, rather, an 
illusion.
  I would urge my colleagues to vote against the amendment. It is 
opposed by people who want jobs, who are concerned about the economic 
welfare and

[[Page 7266]]

well being of the country, and the auto workers.
  Mr. Chairman, I reserve the balance of my time.
  Mr. MARKEY. Mr. Chairman, I yield 30 seconds to the gentleman from 
Washington State (Mr. Inslee.)
  Mr. INSLEE. Mr. Chairman, I would, just in support of this amendment, 
report how successful our country has been previously with this 
experience. I want to point to a graph showing our fuel efficiency in 
1975, that when we were adopting fuel efficiency standards, rocketed up 
and almost doubled to 1985, then stopped when we lost our commitment to 
fuel efficiency.
  And subsequently it has plateaued; it has actually gone down. The 
average fuel efficiency today is less than it was in 1985. I want to 
point this out, because it shows an American success story. We were 
successful in driving safe, efficient, fuel-efficient cars. And we got 
off the fuel-efficiency wagon.
  It is time to go back. We cut a deal with Canada the other day. We 
can do it in America.
  Mr. UPTON. Mr. Chairman, I yield 2 minutes to the gentleman from 
Texas (Mr. Barton), the chairman of the powerful Energy and Commerce 
Committee.
  Mr. BARTON of Texas. Mr. Chairman, I rise in opposition to this 
amendment. You could classify this amendment as the darn-the-people 
amendment, and we are going to tell them what they want to do, not what 
they really want to do. We are going to tell them that they have to do 
something whether they want to or not.
  I would list as Exhibit A the parking garage of the Cannon Office 
Building or the Rayburn Office Building or the Longworth Office 
Building. There are cars and trucks on the market today that meet the 
standards that would have to be met if this amendment were to become 
law. I doubt that the congressional fleet meets that standard, because 
we, like everybody else, want some convenience and want some power 
under the hood.
  But if you want a car or truck that gets 35 or 36 miles a gallon or 
40 miles a gallon or more, you can buy it today. How many of us do 
that? I have had one vehicle that my son actually bought; it was a 
Nissan Sentra. It probably got 35 miles to the gallon on the highway. 
When he got through with it and bought himself a little bit bigger, 
more fancy vehicle, he let me drive it, and I brought it up here, used 
it as my car for a while. My staff was so embarrassed: it did not have 
an air conditioner; it was a standard transmission. I could hardly get 
them to get in the car.
  But I did have one vehicle in my life that would have met the 
standard that is in this bill. I represent an assembly plant in 
Arlington, Texas, a UAW plant. I doubt very many of those folks 
actually vote for me because I am a Republican and most of them are 
not, but they have a right to make the Chevrolet Tahoes and the 
Cadillac Escalades, because a lot of Americans want to drive that 
vehicle.
  I am not going to go down and tell them, you cannot make that vehicle 
because it does not meet these fuel-efficiency standards. Let the 
market decide. If America wants more fuel-efficient vehicles, they are 
available in the marketplace today.
  We do not need a government fiat telling them that that is the only 
vehicle that they can purchase. Vote against this amendment.
  Mr. BOEHLERT. Mr. Chairman, I yield 30 seconds to the gentleman from 
Connecticut (Mr. Shays).
  Mr. SHAYS. Mr. Chairman, I rise in strong support of the Markey-
Boehlert, et al amendment. People used to own slaves and we look back 
and say how could they? Future generations will say we destroyed the 
environment and how could we?
  Let us conserve, let us see oil prices go down as we stop wasting 
what we have. SUVs, mini-vans, and trucks need to get better mileage; 
and we need to tell the automobile manufacturers to make this happen.
  Mr. Chairman, I rise in strong support of the support of the 
amendment to reduce our consumption of oil by increasing fuel economy 
standards for passenger cars and light trucks.
  This amendment requires the Department of Transportation to raise 
fuel economy standards for automobiles from today's average of 25 miles 
per gallon to 33 miles per gallon by 2015.
  Under this amendment, the Administrator of the National Highway 
Transportation Safety Administration will have maximum flexibility in 
how the standards are set. the standard could be increased for cars or 
SUVs or only the heaviest trucks.
  Mr. Chairman, I agree with those who say, ``We cannot conserve our 
way out of this energy problem.'' However, until we raise CAFE 
standards, we cannot honestly tell the American people this is a 
balanced energy plan.
  It is absolutely imperative we are more efficient and make better use 
of our precious resources.
  This is a common sense amendment, which represents a modest step 
forward in our nation's efforts to become more energy efficient. Our 
amendment will help protect the environment, reduce our dependence on 
foreign oil and save drivers money at the pump.
  The United States cannot continue on a course of increased oil 
consumption with little to no regard for the implications it has on our 
environment, economy and national security. There is no better time to 
focus on reducing our reliance on foreign oil than right now. Increased 
fuel efficiency standards and tax incentives for conservation and 
renewable energy sources should be at the heart of our national energy 
policy in a post-September 11 world.
  Mr. DINGELL. Mr. Chairman, I yield 1 minute to the distinguished 
gentleman from Michigan (Mr. Kildee).
  Mr. KILDEE. Mr. Chairman, I rise today to oppose the Boehlert-Markey 
amendment to the energy bill. This unnecessary amendment would hurt our 
already struggling economy. It threatens the jobs of workers in Flint, 
Bay City, Saginaw, and other communities in my congressional district 
and in my home State of Michigan.
  It undermines the hard work of our auto companies and auto workers 
that is being made through the investment of billions of dollars in 
alternative fuels and advanced technology vehicles. The drastic 
increases called for in this amendment would have negative consequences 
for passenger safety and consumer choice.
  The National Highway Traffic Safety Administration has increased CAFE 
standards, which is their obligation. Clearly, the current process, Mr. 
Chairman, is working. Opposing this amendment protects jobs, passenger 
safety, consumer choice, and advancing auto technology.
  I urge my colleagues to oppose this amendment.
  Mr. MARKEY. Mr. Chairman, I yield 1\1/2\ minutes to the gentleman 
from New Jersey (Mr. Menendez), the chairman of the Democratic Caucus.
  Mr. MENENDEZ. Mr. Chairman, I rise in strong support of the Boehlert-
Markey amendment. Despite the bill's claims to meet our Nation's energy 
needs and provide for our Nation's future, H.R. 6 ignores a pivotal 
approach that will reduce our foreign dependence on oil and alleviate 
our high oil consumption, increasing fuel economy standards.
  Let us look at what we know. We know that fuel economy standards have 
helped to reduce our dependence on foreign oil. We know that raising 
the standard to 33 miles a gallon over the next 10 years, which this 
amendment would do, would save 10 percent of the gas we will consume, 
and we know that we have the potential in this country to make cars and 
light trucks much more efficiently.
  Mr. Chairman, we need to unlock that potential. We have the 
technology; we have the innovation. Despite all of this, the bill 
before us makes no effort to increase those standards. We have a 
choice: Do we want an energy future that is stagnant and dependent on 
traditional sources, or do we want a future that will break new 
boundaries in innovation and technology, reduce our dependency on 
foreign oil, increase conservation and efficiency and ensure the 
security of our Nation?
  Let us prove that we are serious about our Nation's energy future. 
Increasing fuel economy standards should be part of the solution and 
part of our National energy policy. And I urge my colleagues to vote 
for the Boehlert-Markey amendment.

[[Page 7267]]


  Mr. UPTON. Mr. Chairman, I yield 1 minute to the gentleman from the 
great State of Michigan (Mr. Rogers).
  Mr. ROGERS of Michigan. Mr. Chairman, you know you cannot make a fat 
guy skinny by mandating smaller pant sizes. People have to want to buy 
the vehicle that you are trying to sell them. There is a reason that 
moms go through the pain and agony of buying an SUV and a mini-van, 
because they are safe, because they can get their whole family in 
there, because they can put a bike in the back, and they can get all 
the groceries in there.
  They buy them because they want them and they are safe. The 
automobile companies today do not get enough credit for all of the 
money they are investing in trying to make these things efficient. 
Believe me, if they could get 40 miles to the gallon in an SUV, they 
would be on these front steps having a press conference selling these 
things. Technology has not matched what consumers want. Let them do 
that. You artificially interfere with where we are going, they are 
making huge strides. To do this costs Americans jobs. It costs 
Americans jobs.
  Let them do what they are doing best, and innovate their way to those 
high-mileage SUVs and mini-vans so moms do not have to drive Mini 
Coopers.
  Mr. BOEHLERT. Mr. Chairman, I yield 1 minute to the gentleman from 
Illinois (Mr. Kirk).
  Mr. KIRK. Mr. Chairman, I believe that this amendment actually saves 
American lives. Mr. Chairman, there is no better way to look at this 
issue than through the eyes of a young soldier stationed in the Middle 
East.
  One of the reasons why we pay so much attention to the Persian Gulf 
is that the economy of the West is totally dependent on oil from this 
region. We must station forces there to make sure that nothing happens 
to our supply of energy.
  And nothing can change this situation right now. But this amendment 
can change this situation for the future. By adopting CAFE standards, 
we will make the Persian Gulf much less important. We will reduce the 
need to ever deploy young Americans into harm's way. Look into the eyes 
of a 10-year-old American and think of him or her, and vote for 
policies which will make it much less likely that any President would 
ever ask them to return to harm's way in the Persian Gulf.
  Mr. DINGELL. Mr. Chairman, I yield 1 minute to the gentlewoman from 
Michigan (Ms. Kilpatrick).
  Ms. KILPATRICK of Michigan. Mr. Chairman, I rise in strong opposition 
to this amendment. The National Traffic Safety Administration is the 
body who sets those standards. There are standards. They scientifically 
set those standards. And sometimes they raise them. It is important 
that we keep that responsibility with NTSA who does a fine job with 
that, to set maximum feasible levels for the standards cars and trucks 
must use.
  I want to read from a good friend here who says, ``Such a proposal 
would dramatically affect the functionality and performance of vans, 
pickup trucks and sports utility vehicles that consumers in America 
want.''
  And that is by the United States Chamber of Commerce. One in 10 jobs 
are related to the auto industry. Fuel economy standards are set 
scientifically, and this body should not get into that.

                              {time}  1830

  We have standards. The American people choose the cars and trucks 
they want to drive. I believe that the standards are set fine. And as 
we go on, the millions of dollars that the industry has put into new 
development, new cars that are energy efficient we will see as time 
goes on. Americans are working and we are winning. Leave the standards 
to NHTSA.
  Mr. MARKEY. Mr. Chairman, I yield 30 seconds to the gentlewoman from 
California (Ms. Eshoo).
  Ms. ESHOO. Mr. Chairman, in a cautionary letter to the President last 
month, a group of defense experts including conservatives Robert 
McFarlane, Frank Gaffney, and Boyden Gray said the following: ``With 
only 2 percent of the world's oil reserves but 25 percent of current 
world consumption, the United States cannot eliminate its need for 
imports through increased domestic production alone.''
  Our dependence on foreign oil is putting our country in a perilous 
situation. I urge my colleagues to support this amendment because it 
will move us away from that perilous addiction to foreign oil and 
increase efficiency where we use the most oil, and that is the 
automobile industry.
  Mr. UPTON. Mr. Chairman, I yield 1 minute to the gentleman from Texas 
(Mr. Burgess).
  Mr. BURGESS. Mr. Chairman, I stand today in opposition for raising 
the CAFE standards. This is an irrelevant piece of legislation that is 
not only unnecessary, it is an outdated solution in search of a 21st 
century problem.
  Changing technology and innovation have rendered this amendment 
unnecessary. The increasing use of hybrid vehicles shows that a market-
based approach to increasing fuel efficiency is a better way to reduce 
American oil consumption than by placing arbitrary standards on 
automobiles that harm our domestic manufacturers. And, in fact, the 
only thing we get with CAFE standards down in my district are car 
dealers with acres and acres of tiny cars they cannot sell.
  With today's high gas prices, hybrid vehicles will help reduce the 
amount of money that our constituents pay at the gas pump.
  Mr. Chairman, in the interest of full disclosure, I drive a hybrid 
vehicle. I did not buy it because of the tax break. I did not buy it 
because of any legislation that we passed in this Congress. I bought it 
largely because of air quality concerns back in my district. But now I 
look positively brilliant that gasoline prices are so high. But the 
best thing about a hybrid vehicle, Mr. Chairman, is it allows you that 
feeling of moral superiority as you drive your car.
  Mr. BOEHLERT. Mr. Chairman, I yield 1 minute to the gentleman from 
Pennsylvania (Mr. Platts).
  Mr. PLATTS. Mr. Chairman, I rise in support of this bipartisan 
amendment. If we want a national energy policy that is truly about 
economic security for all Americans, not just those in the auto 
industry, that is about national security for all Americans, it needs 
to be comprehensive. It needs to be about hybrid vehicles, alternative 
fuels, renewable fuels. It needs to be about better using our resources 
we have. But it also needs to be about conservation.
  This amendment is one of the greatest steps we can take in the area 
of going forward in conservation. It is not about whether you should be 
able to buy an SUV. It is about whether you should be able to buy an 
SUV that gets 27.5 miles per gallon like a car does instead of 20.7. It 
is about choice and efficiency.
  This amendment is a good amendment. I urge a ``yes'' vote. I commend 
the prime sponsors of the amendment for bringing it before the House.
  Mr. DINGELL. Mr. Chairman, I yield 1 minute to the gentleman from 
Pennsylvania (Mr. Doyle).
  Mr. DOYLE. Mr. Chairman, I would respectfully add my voice to those 
opposing this amendment.
  While clearly we all want to reduce our imports of foreign oil, I 
have not been convinced that raising CAFE standards would actually 
accomplish this. As I understand it, our imports' share of oil 
consumption was 35 percent in 1974. Since then, our new car fuel 
economy has roughly doubled, but our auto import share has risen 
nonetheless to about 50 percent. For this reason, I am not convinced 
that the amendment, if adopted, with achieve one of its primary goals.
  Additionally, our national economy is struggling, to say the least. 
In my home State of Pennsylvania, which is not normally thought of as a 
State closely tied to the automotive industry, a total of 220,800 jobs 
are dependent on the industry; 39,700 of these people are directly 
employed by it, and when you add in other spin-off employment, we are 
talking about over 220,000 jobs in Pennsylvania alone.
  Mr. Chairman, in these difficult economic times, I simply do not 
think it is prudent to put those jobs and this vital

[[Page 7268]]

industry in jeopardy when it is not clear the benefits potentially 
derived would merit doing so.
  With the gentleman from Michigan (Mr. Dingell) I urge defeat of the 
amendment.
  Mr. MARKEY. Mr. Chairman, I yield 30 seconds to the gentleman from 
California (Mr. Cardoza).
  Mr. CARDOZA. Mr. Chairman, I rise today in support of the amendment 
and in opposition to the underlying legislation.
  We need to increase our fuel efficiency if the U.S. is ever going to 
get serious about our energy crisis. Last year, Mr. Chairman, I voted 
for this energy bill because I thought we needed a national plan, but 
that was when oil was selling at $30 a barrel.
  This year, when oil is averaging $55 a barrel and gas prices are 
nearly $3 a gallon in some places, it is bad public policy to add to 
the national debt, borrowing the money to give to companies who are 
making record profits. The American people deserve better.
  I ask for an ``aye'' vote.
  The Acting CHAIRMAN. The gentleman from Michigan (Mr. Upton) has 1 
minute remaining.
  Mr. UPTON. Mr. Chairman, I yield myself the balance of my time.
  Mr. Chairman, I have a trivia question for you. What automaker has 
the most vehicles that get a highway fuel economy of 30 miles per 
gallon or greater? I will give you a hint. They make 19 of the 
vehicles, and that is more than any other automaker.
  Do you know who it is? General Motors.
  What frustrates me about this debate is the misconception that CAFE 
standards are some Holy Grail that foreign manufacturers can get to, 
but domestic ones cannot. We do not need to micromanage our auto 
manufacturers. They are doing just fine. CAFE standards are being met 
and they are being exceeded virtually every single day.
  But the more important work is finding real alternatives to gasoline-
powered cars and developing them, for every dollar we force the auto 
companies to spend on the CAFE standards is a dollar they will not 
spend on hybrids, hydrogen fuel cell and other alternative fuel cell 
vehicles.
  I am sick of hearing the same old debate. I want to get us to the 
point where we talk about which one of the new alternatives we are most 
excited about.
  I urge you to defeat this used amendment and vote for a new car. 
Please defeat this amendment.
  Mr. Chairman, I yield back the balance of my time.
  Mr. BOEHLERT. Mr. Chairman, I reserve the balance of my time.
  Mr. DINGELL. Mr. Chairman, I believe that I am entitled to close the 
debate?
  The Acting CHAIRMAN. The gentleman from Michigan (Mr. Dingell) is 
entitled to close and the gentleman has 1 minute remaining.
  Mr. DINGELL. Mr. Chairman, I reserve the balance of my time.
  The Acting CHAIRMAN. The gentleman from Massachusetts (Mr. Markey) 
has 2 minutes remaining.
  Mr. MARKEY. Mr. Chairman, I yield myself the balance of my time.
  Mr. Chairman, this is the key issue if we are going to get serious 
about the imports of oil into our country.
  We put 70 percent of all oil that we consume in America into gasoline 
tanks. In 1975, we averaged 13 miles per gallon; we averaged 13 miles 
per gallon in 1935. But Congress, because of the energy crisis, passed 
a law mandating a doubling of the standards in 10 years, and the auto 
industry responded; and by 1986, the average was 27 miles per gallon, 
and we had OPEC on its back. The price of oil fell to $12 a barrel. We, 
using our technological genius, had won.
  Now, it is almost 20 years later and America is now averaging 23 
miles per gallon. We have gone backwards 4 miles per gallon and played 
into OPEC's hands as the price of oil goes up to $50 to $55 to $58 a 
barrel, as consumers are tipped upside down every time they go into a 
gas station in order to pay to fill up their car.
  The only answer is to call upon our country's greatness to improve 
the fuel economy standards to 33 miles per gallon by 2015. In other 
words, to add only 6 additional miles per gallon over what was 
accomplished in 1986.
  The opponents of this amendment say that is impossible. Well, we put 
a man on the moon in 9 years. We improved the fuel economy standards in 
10 years by 13 miles per gallon in the 1970s and 1980s, but now we are 
being told that we do not have any longer the ability to do that.
  Well, we are 60 percent dependent upon imported oil. We are heading 
towards 65 percent, towards 70 percent. That is increased national 
security problems for our country that we will look back at and regret 
that we missed this opportunity to make our country more secure.
  Mr. Chairman, I yield back the balance of my time.
  Mr. BOEHLERT. Mr. Chairman, how much time do I have remaining?
  The Acting CHAIRMAN. The gentleman from New York (Mr. Boehlert) has 
1\1/2\ minutes remaining.
  Mr. BOEHLERT. Mr. Chairman, I yield myself the balance of my time.
  Mr. Chairman, this is myth versus reality. Myth number one: This will 
cost us jobs, passing this amendment. ``Jobs'' is my favorite four-
letter word. This is a bunch of nonsense. The reality is, the new 
standards, if they are enacted into law, Americans will buy more, not 
fewer, vehicles because they will be more fuel efficient.
  Myth number two: CAFE standards will force Americans into smaller 
vehicles. The reality is, we heard that argument first back in 1975. 
The opponents said, If you adopt this new standard, all Americans will 
be driving compacts or subcompacts in 10 years. What has happened? The 
record is bigger and bigger vehicles all over the place.
  The fact of the matter is, we do not want to take away choice from 
consumers. We want them to have their SUVs if that is what they want. 
We want them to have their light trucks if that is what they want. We 
want Detroit and the American auto industry to make more fuel-efficient 
vehicles.
  Finally, this really offends me, myth number three: We will sacrifice 
safety. That is what the opponents say; that is not what the National 
Academy of Sciences says. We already have the technology on the shelf 
gathering dust to manufacture more fuel-efficient automobiles and light 
trucks. I say the alarm has been sounded. This is a national security 
issue.
  We are far too dependent on foreign-source oil. This amendment alone 
will save 2 million barrels a day by 2020 and, in the process, save the 
American consumers that are fed up with a car requiring $40 or $50 to 
fill up. They want more fuel efficiency, and we owe it to them and to 
ourselves to deliver it.
  The Acting CHAIRMAN. The gentleman from Michigan (Mr. Dingell) has 1 
minute remaining.
  Mr. DINGELL. Mr. Chairman, I yield the balance of my time to the 
distinguished gentleman from Michigan (Mr. Stupak) to close the debate.
  Mr. STUPAK. Mr. Chairman, I rise in opposition to the amendment. 
Encouraging and supporting the development of innovative new technology 
is preferable to arbitrary increases in CAFE standards that will truly 
hurt thousands of American workers. Moreover, the National Academy of 
Sciences report of 2001 indicated that only the subcompact car segment 
of our fleet could be expected to achieve this fuel economy level.
  This suggests that a substantial portion of the vehicles on the road 
would have to be very small to reach this objective. Reducing our 
consumption of oil should come from new technology, not by mandating a 
standard that requires most vehicles to be a subcompact.
  The National Academy of Sciences also raises concerns about potential 
increases in highway fatalities if the auto industry is forced into 
selling a greater share of small vehicles. According to the analysis of 
the Insurance Institute of Highway Safety Data in 1999, since CAFE 
standards were first announced in 1975, approximately 46,000 people 
died in crashes who would have survived if CAFE had not encouraged 
smaller, lighter cars.

[[Page 7269]]

  I am concerned that this amendment would lead to more unnecessary 
fatalities. For these reasons, I urge a ``no'' vote on this amendment.
  The Acting CHAIRMAN. The question is on the amendment offered by the 
gentleman from New York (Mr. Boehlert).
  The question was taken; and the Acting Chairman announced that the 
noes appeared to have it.
  Mr. BOEHLERT. Mr. Chairman, I demand a recorded vote.
  The Acting CHAIRMAN. Pursuant to clause 6 of rule XVIII, further 
proceedings on the amendment offered by the gentleman from New York 
(Mr. Boehlert) will be postponed.
  The Acting CHAIRMAN. It is now in order to consider amendment No. 5 
printed in House Report 109-49.


         Amendment No. 5 Offered by Mrs. Johnson of Connecticut

  Mrs. JOHNSON of Connecticut. Mr. Chairman, I offer an amendment.
  The Acting CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 5 offered by Mrs. Johnson of Connecticut:
       In title VII, subtitle E, add at the end the following new 
     section:

     SEC. 775. UPDATE TESTING PROCEDURES.

       The Administrator of the Environmental Protection Agency 
     shall update or revise test procedures, Subpart B--Fuel 
     Economy Regulations for 1978 and Later Model Year 
     Automobiles-Test Procedures 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.

  The Acting CHAIRMAN. Pursuant to House Resolution 219, the 
gentlewoman from Connecticut (Mrs. Johnson) and a Member opposed each 
will control 5 minutes.
  The Chair recognizes the gentlewoman from Connecticut (Mrs. Johnson).
  Mrs. JOHNSON of Connecticut. Mr. Chairman, I ask unanimous consent to 
yield to the gentleman from New Jersey (Mr. Holt) 2\1/2\ minutes for 
purposes of control.
  The Acting CHAIRMAN. Is there objection to the request of the 
gentlewoman from Connecticut?
  There was no objection.
  Mrs. JOHNSON of Connecticut. Mr. Chairman, I yield myself such time 
as I may consume.
  Mr. Chairman, I rise today in strong support of the Johnson-Holt 
amendment. It is a simple amendment. It is simply truth in advertising, 
EPA truth in advertising.

                              {time}  1845

  For the past 3 decades, American motorists have been buying cars, 
relying on miles-per-gallon stickers that grossly overestimate the 
miles per gallon a car can get. For some vehicles, the advertised miles 
per gallon is off by as much as 30 percent.
  With gas at $2 a gallon and some cars costing more than my husband 
and I paid for our first home, such false information is simply 
intolerable, and it is intolerable that our tax dollars are paying for 
the EPA to develop false and misleading information.
  The auto makers are not at fault; neither are the oil companies. It 
is our own government. That is the culprit, and we cannot tolerate EPA 
providing wildly inaccurate miles-per-gallon information in the future.
  The way to change this is simple. We simply have to modernize the 
testing procedures that EPA uses. The EPA uses 30-year-old testing 
standards. The EPA assumes that highway drivers never exceed 50 miles 
an hour; but of course, they do, and the faster they drive, the more 
wind resistance they get and the lower fuel economy they achieve.
  The EPA also assumes that the rate at which drivers brake and 
accelerate has not changed over 30 years. Even though the cars have 
changed dramatically and so have the driving habits. They do not notice 
that driving in cities is entirely different with its stop-and-go 
traffic and traffic jams than it used to be 30 years ago.
  So our amendment is really simple, straightforward, and common sense. 
It mandates that EPA update the tests used in determining estimated 
fuel-economy ratings to reflect real-world driving habits of American 
motorists.
  This is an important little amendment. It is a pocketbook issue. New 
cars are expensive. Gasoline is expensive. People can buy whatever car 
they want, that is their right; but they should have accurate 
information on which to base their choice, and their tax dollars should 
not be spent for false and misleading information.
  So I urge the support of my amendment.
  Mr. Chairman, I reserve the balance of my time.
  The Acting CHAIRMAN (Mr. Simpson). The gentlewoman from Connecticut's 
(Mrs. Johnson) 2\1/2\ minutes has expired.
  Mr. BARTON of Texas. Mr. Chairman, I rise in mild opposition to the 
Johnson amendment.
  The Acting CHAIRMAN. The gentleman from Texas (Mr. Barton) is 
recognized for 5 minutes.
  Mr. BARTON of Texas. Mr. Chairman, I yield myself such time as I may 
consume.
  Mr. Chairman, I said mild opposition because it is exactly what it 
is. I chair the committee of jurisdiction that would have this 
amendment, and we have been working with the Congresswoman from 
Connecticut to try to perfect her amendment. She has been very gracious 
to come up to me on the floor, and then her staff and committee staff 
have been working, and we really thought that earlier in the week or 
late last week we had an amendment that everybody could agree to. For 
various reasons, that was not agreed to, so we have the situation 
today.
  At the close of this debate, the gentleman from Michigan (Mr. 
Rogers), a member of the committee of jurisdiction, is going to offer a 
perfecting amendment to the Johnson amendment. I am going to support 
that at the appropriate time.
  We support the goal of the Johnson amendment. She is trying to get 
consumers fair and accurate information when they go into a showroom or 
are thinking about purchasing a new vehicle. She states, and I agree, 
that the consumer has a right to know what the fuel economy is of that 
particular vehicle; and under current law, the way the tests are 
conducted, there is some discrepancy, as she has pointed out in her 
statement in support of her amendment.
  Having said that, there are those that have reviewed her amendment 
and think that it could be a backdoor approach to CAFE standard 
increases. We just had the debate on the Boehlert-Markey amendment. I 
voted in the negative on that, and I think when that rollcall is 
called, the majority of the House is going to be in the negative. So I 
know that is not the intent of the gentlewoman's amendment, but there 
are some that think it could be.
  We are going to oppose this amendment and support the gentleman from 
Michigan's (Mr. Rogers) amendment in the nature of a substitute or 
amendment to the Johnson amendment. I think at the end of the day, the 
House is going to work its will, and the gentlewoman from Connecticut 
(Mrs. Johnson) is going to be happy and the gentleman from Michigan 
(Mr. Rogers) is going to be happy and the consumers of America are 
going to be happy when they go into showrooms a year or two from now 
and see these new window labels that show what the fuel economy is.
  Mr. Chairman, I reserve the balance of my time.
  Mr. HOLT. Mr. Chairman, I yield 45 seconds to the gentlewoman from 
California (Ms. Woolsey).
  Ms. WOOLSEY. Mr. Chairman, I wonder how many Americans have bought a 
car and wondered why their gas mileage was not what had been 
advertised. Well, it is because the fuel economy numbers advertised by 
automobile manufacturers are based on 30-year-old fuel economy tests, 
tests that have not been adjusted for today's realities, and that leads 
Americans to be regularly misled by inaccurate labels.
  The automobile industry has changed significantly over the last 3 
decades,

[[Page 7270]]

but the EPA standards are stuck in the past, overestimating fuel 
economy data.
  I support this amendment. It will require the EPA to update its 
testing standards so that consumers will have accurate fuel economy 
information in the future.


                         parliamentary inquiry

  Mr. BARTON of Texas. Mr. Chairman, parliamentary inquiry, since the 
Rogers amendment, which is next in line, amends, or perfects, the 
Johnson amendment, does the gentleman from Michigan (Mr. Rogers) have 
to seek recognition to offer his amendment before the close of debate 
on the gentlewoman from Connecticut's (Mrs. Johnson) amendment, or does 
he wait until her debate concludes and then offers his amendment?
  The Acting CHAIRMAN. The gentleman may offer his amendment to the 
amendment at any time during debate on the Johnson amendment.
  Mr. BARTON of Texas. At any time.
  The Acting CHAIRMAN. The gentleman from Texas (Mr. Barton) is 
recognized.
  Mr. BARTON of Texas. Mr. Chairman, I reserve my time.
  Mr. HOLT. Mr. Chairman, I yield 45 seconds to the other gentlewoman 
from California (Mrs. Davis).
  Mrs. DAVIS of California. Mr. Chairman, I support this bill so that 
we can, and the public can, rely on the energy-conscious information 
that they are getting and that they know that is correct and accurate, 
and they can move forward with that.
  Mr. Chairman, Members, are your constituents also asking you what you 
are doing about high gas prices? We must answer that question in this 
bill.
  Individuals can do something about their gasoline consumption when 
they select a car to buy. We need to help them.
  People expect that, when they look at the window sticker, the miles 
per gallon figures that the EPA supplies are what they will get when 
they purchase the car.
  They are not.
  When one of my staff members complained to the car dealer that the 
gas mileage figures were way off for City Driving for the car she had 
selected for its fuel efficiency, the dealer said, ``Oh, that doesn't 
apply to driving in DC.''
  I support this amendment because it would require the EPA to correct 
the long-standing inaccuracies in its testing procedures.
  Our constituents must be able to rely on these facts to be the 
energy-conscious consumers they want to be.


 Amendment No. 6 offered by Mr. Rogers of Michigan to Amendment No. 5 
                 Offered by Mrs. Johnson of Connecticut

  Mr. ROGERS of Michigan. Mr. Chairman, I offer an amendment to the 
amendment.
  The Acting CHAIRMAN. The Clerk will designate the amendment to the 
amendment.
  The text of the amendment to the amendment is as follows:

       Amendment No. 6 offered by Mr. Rogers of Michigan to 
     amendment No. 5 offered by Mrs. Johnson of Connecticut:
       In the matter proposed to be inserted by the amendment, 
     strike ``test procedures'' and all that follows through 
     ``Later Model Year Automobiles-Test Procedures'' and insert 
     ``the adjustment factors in sections''.

  The Acting CHAIRMAN. Pursuant to House Resolution 219, the gentleman 
from Michigan (Mr. Rogers) and the gentlewoman from Connecticut (Mrs. 
Johnson) each will control 5 minutes.
  The Chair recognizes the gentleman from Michigan (Mr. Rogers).
  Mr. ROGERS of Michigan. Mr. Chairman, I yield 2 minutes to the 
distinguished gentlewoman from Michigan (Ms. Kilpatrick).
  Ms. KILPATRICK of Michigan. Mr. Chairman, I thank the gentleman for 
yielding me time.
  We rise to make this a better amendment. If we want EPA to do the 
testing, to make sure that things are right and labeling is correct, 
then we want to make sure that there is one test to do that. What we do 
not want to do is put additional funds, additional costs, additional 
measures on the auto industry that is already very fragile.
  So we rise in opposition to the Johnson amendment and ask that our 
amendment be considered because the testing is there. We do not need to 
have two tests, as is required by the Johnson amendment. It doubles the 
cost for product, and it allows the competition to be more advanced in 
our competition war than we are now considering.
  The auto industry in America is fragile. We all know that they have 
invested millions of dollars in their products to make them better, 
make them fuel efficient, do alternative energy sources.
  We believe that our amendment is a perfecting one; and, yes, it 
requires that the EPA do the proper tests, not two times but the one 
time that is required and that the labeling be accurate.
  We hope that our colleagues will support this Rogers-Kilpatrick 
amendment. It is a much better amendment, and again works with EPA to 
make sure that the labeling is correct with the one test.
  Consumers deserve to know that the sticker in their window actually 
reflects the mileage they will get on the road.
  The EPA should revisit their fuel economy standards and the Rogers/
Kilpatrick amendment would require the EPA to change the adjustment 
factors that it currently uses to make the fuel economy label accurate.
  Nancy Johnson's amendment requires the EPA to change the ``testing 
procedures'' that auto companies use to determine the fuel economy 
numbers that go on the dealer label.
  Her amendment would require two test auto companies to do one test 
for labeling and a separate test for CAFE.
  Johnson's language doubles the cost to the companies.
  The Rogers/Kilpatrick amendment deals with the need for improved 
dealer label accuracy while only requiring one test.
  Instead of requiring EPA to change the ``testing procedures'' the 
Rogers/Kilpatrick amendment requires the EPA to change the ``adjustment 
factors'' that EPA currently uses to make the fuel economy label 
accurate.
  This simple change prevents the auto companies from having to run two 
separate tests.
  Rather the auto companies can run one test that could be used and 
adjusted with appropriate factors to provide a more accurate fuel 
economy number.
  The Rogers/Kilpatrick perfecting amendment to the Johnson amendment 
achieves precisely the same goal that the Johnson amendment strives to 
achieve: accurate fuel economy labels on new cars.
  The only difference is that the Rogers/Kilpatrick amendment achieves 
this goal by having EPA revise the current test, instead of compelling 
EPA to conduct two separate tests.
  The Rogers/Kilpatrick perfecting amendment makes clear that the 
objective is to change the fuel economy label values--NOT the test 
procedures. This will ensure that this measure will improve consumer 
information regarding mileage without imposing an increase in the 
stringency of CAFE or creating a second fuel economy test for consumer 
labeling.
  The Johnson amendment COULD threaten to increase the stringency of 
CAFE.
  The Johnson amendment would require EPA to change fuel economy 
testing for label purposes.
  If the intent of this change is to create a new test for fuel economy 
labeling then the burden on automakers to test vehicles for both CAFE 
and fuel economy labeling would increase substantially.
  If, however, the intention is to retain only one vehicle fuel economy 
test, then the test protocol currently used for determining CAFE values 
will also be affected--lowering the fleet fuel economy averages of 
manufacturers and making compliance with the CAFE standards more 
stringent.
  Depending upon the test procedure changes implemented, the stringency 
of the CAFE standards could increase by 10-20% (or up to a 6 mpg 
increase in the stringency of the CAFE requirements).
  The Acting CHAIRMAN. The gentlewoman from Connecticut controls the 
time in opposition to the amendment.
  Mrs. JOHNSON of Connecticut. Mr. Chairman, I reserve the balance of 
my time on the Rogers amendment so that we can move on to the gentleman 
from New Jersey's (Mr. Holt) comments on our amendment.
  The Acting CHAIRMAN. We are currently on the Rogers amendment.
  Mr. HOLT. That is fine, if the gentlewoman would yield.
  Mrs. JOHNSON of Connecticut. Mr. Chairman, I yield 2 minutes to the 
gentleman from New Jersey (Mr. Holt) on the Rogers amendment.
  Mr. HOLT. Mr. Chairman, it is my understanding that I also have 1 
minute remaining on the underlying amendment.
  The Acting CHAIRMAN. The gentleman from New Jersey (Mr. Holt) has 
1\1/2\ minutes remaining.
  Mr. HOLT. Mr. Chairman, I thank the gentlewoman for the time.

[[Page 7271]]

  When you go to the showroom to pick out a new car, the sticker in the 
window has a number for city mileage, highway mileage. You would like 
to think that that bore some relationship to reality. Now, on the 
television ads, they say your actual mileage may vary, when, in fact, 
your actual mileage probably bears no relationship whatsoever to those 
numbers in the window because EPA has specified that the auto 
manufacturers use an archaic testing method.
  The amendment that the gentlewoman from Connecticut and I have 
offered would correct that testing method. That is the way to take care 
of this problem. It is not the right thing to do to use a multiplier 
factor, a scale factor, to grade on a curve or to use a fudge factor. 
That is what the gentleman from Michigan (Mr. Rogers) is proposing to 
do, rather than getting at the heart of the problem, which is that the 
tests are not done in a realistic way.
  The tests do not reflect the way people actually drive. The tests 
suggest that highway speeds are 48 miles per hour with a top speed of 
60. Has anybody been on the road recently? That is not the way people 
drive.
  The tests suggest that congestion and stop-and-go traffic is a minor 
part of driving. By 2001, congestion took about 26 hours per year out 
of a person's driving time. That is not realistically reflected in the 
testing method.
  The testing method assumes gentle acceleration and braking. That is 
not the way city driving is done.
  The tests suggest or require that there be no air conditioning, and 
it overestimates trips.
  In other words, the tests are wrong. The tests should be modified to 
reflect the way people actually drive. Using a fudge factor, a 
multiplier will hide the actual differences between cars, and it will 
obscure what this is about, which is giving consumers accurate 
information.
  It is certainly the case that for a government-mandated test we 
should get it right. That is all we are suggesting, and this amendment 
that the gentleman from Michigan (Mr. Rogers) has may technically, 
under parliamentary terms, be called a perfecting amendment. In fact, 
it completely changes the nature of what we are trying to do, which is 
to give consumers accurate information.
  The Acting CHAIRMAN. The Chair would clarify for the Members, on the 
underlying amendment, the gentlewoman from Connecticut (Mrs. Johnson) 
has 2\1/2\ minutes remaining. The gentleman from Michigan (Mr. Rogers) 
has 3\1/2\ minutes remaining.
  On the amendment by the gentlewoman from Connecticut, the gentleman 
from Texas (Mr. Barton) has 2\1/2\ minutes remaining. The gentleman 
from New Jersey (Mr. Holt) has 1\1/2\ minutes remaining. The 
gentlewoman from Connecticut's (Mrs. Johnson) time has expired.


                        Parliamentary Inquiries

  Mr. BARTON of Texas. Mr. Chairman, could I ask a parliamentary 
inquiry. Before we go to the gentleman from Michigan, when it comes 
time to vote, are we going to vote on the Rogers amendment to the 
Johnson amendment, and then if it is amended, we will vote on the 
Johnson amendment; is that correct? There will be two votes, Rogers to 
amend Johnson and then Johnson, either amended or un-amended, depending 
on how the Rogers amendment fairs?
  The Acting CHAIRMAN. If a recorded vote is requested on the Rogers 
second degree amendment, the Chair would postpone the request and would 
not put the question on the Johnson amendment until after disposition 
of the vote on the amendment of the gentleman from Michigan.
  Mr. BARTON of Texas. But we are going to have two votes?
  The Acting CHAIRMAN. All time for debate will be consumed now.
  Mr. BARTON of Texas. Thank you, Mr. Chairman.
  The Acting CHAIRMAN. The gentleman from Michigan (Mr. Mike Rogers) is 
recognized.
  Mr. ROGERS of Michigan. Mr. Chairman, parliamentary inquiry, how do 
we get to the chairman's 2\1/2\ minutes remaining on the primary 
amendment?
  The Acting CHAIRMAN. The gentleman from Texas (Mr. Barton) may use 
his 2\1/2\ minutes now if he wishes.

                              {time}  1900

  Mr. BARTON of Texas. Mr. Chairman, I yield the balance of my time to 
the gentleman from Michigan (Mr. Upton), the distinguished chairman of 
the Subcommittee on Telecommunications and the Internet of the 
Committee on Energy and Commerce.
  Mr. UPTON. Mr. Chairman, I thank my distinguished chairman for 
yielding me this time, and I rise in strong support of the Rogers 
amendment to the Johnson underlying amendment.
  Currently, there is one test conducted on vehicles to determine the 
fuel economy rating. The Johnson amendment would require EPA to change 
that fuel economy testing for label purposes. What this will result in 
is having automakers being forced to do two or three or four, or maybe 
even more, separate tests. That costs money, more money, and is 
unnecessary and more burdensome.
  Additionally, as written, the Johnson amendment could also affect how 
CAFE is calculated. The Johnson amendment could lower the fleet fuel 
economy averages of manufacturers that make compliance with the CAFE 
standards much more difficult. Instead of running the substantial risk 
under the Johnson amendment, the Rogers/ Kilpatrick bipartisan 
perfecting amendment makes a technical change to clarify that 
automakers do not have to run multiple duplicative tests to update fuel 
economy labeling and ensures that the CAFE program is not manipulated.
  Let us take this into a normal example. This morning, many of us, we 
live in different States, but we come and commute here to Washington. I 
live in Virginia; it is 7 miles from the Capitol here to my house. It 
took me more than 30 minutes to get in today. If I had to drive 7 miles 
in my town of St. Joseph, Michigan, it would take me about 12 minutes. 
We know that when we buy a car.
  I had a staff member that bought a great new Ford hybrid vehicle the 
other day. He gets accelerated CAFE, or he gets much better gas mileage 
with that car when he is in the big city driving. When he goes to 
Chicago, to see the Cubs or the White Sox, or whoever, he gets a lot 
better mileage because he is stopping and starting all the time. In 
Kalamazoo, which is a city of 100,000, where he lives, he does not get 
quite the same mileage because it is a different scenario.
  You cannot have 20 or 30, who knows how many tests. Maybe it is like 
boutique fuels. You have all these different areas, people with 
different driving habits, and you cannot expect that the EPA is going 
to put a laundry list of these different tests on the window. We know 
that when we buy our vehicles. We know about what it is going to be 
based on, our history of purchasing cars. And, frankly, a duplicative 
test with these multiple numbers will only be more confusing rather 
than less confusing to the consumer.
  That is why I strongly urge my colleagues on both sides of the aisle, 
as we have with this bipartisan amendment, to support the Rogers 
amendment to the Johnson amendment so we can make more sense for every 
consumer as they purchase a new American car.
  Mr. ROGERS of Michigan. Mr. Chairman, I yield myself 2 minutes.
  Mr. Chairman, I want to thank the sponsors of the amendment and their 
intent and where they wanted to go. The gentlewoman from Connecticut 
(Mrs. Johnson) has done a great job of focusing on a problem that is a 
problem. We all want accurate numbers on those stickers and times have 
changed. The gentleman from Michigan and the gentlewoman from Michigan, 
I think, have outlined exceptionally well why this perfecting amendment 
makes the intent of what our colleague wants to do exactly that. It 
clarifies it to the point that we do not get into CAFE, we get accurate 
numbers, and we do not foist a whole set of new costs onto automakers 
who are today struggling to keep people employed.
  We want accurate numbers as well. But I will tell you, families 
across this

[[Page 7272]]

country are suffering in the automobile industry. They are suffering. 
They have layoffs, they have job cuts, there is a lack of hope in some 
areas and anxiety you cannot believe in others. So let us err on the 
side of those families. Let us stand up today and say, yes, we should 
have accurate numbers on these stickers, the very true intent of what 
the gentlewoman from Connecticut (Mrs. Johnson) and the gentleman from 
New Jersey (Mr. Holt) are trying to do and trying to accomplish.
  Let us do that, but we can do that without new costs, without new 
burdens, without even getting close to this argument that they are 
going to get into in the CAFE debate, and accomplish exactly what they 
want.
  I think my colleagues can be proud of this amendment, as amended, 
back in their districts and tell people that they fought valiantly to 
get the 2005 standards on stickers for cars they are going to buy 
today. It is the right thing to do.
  So I would urge my colleague to look deep down and say, do I want to 
take the chance that I will put out one more American family out of 
work? Because I think you will. I passionately believe you will, the 
way your amendment is constructed. It will foist new, unnecessary costs 
on automakers.
  Let us do it the way we know can accomplish what you want and have 
families at the end of the day saying, I am going to show up and build 
the finest cars in the world right here, in the great State of 
Michigan, or any other of the 49 great States of this great country.
  Mr. Chairman, I reserve the balance of my time.
  Mrs. JOHNSON of Connecticut. Mr. Chairman, I rise in opposition to 
this amendment.
  Now, let me get to the heart of this matter, because if I thought 
this was going to cost people jobs, I certainly would not bring it up. 
This question specifically was litigated in 1985 in the D.C. Circuit 
Court, Center for Auto Safety v. Thomas, and the court clearly 
determined that the CAFE calculation cannot be changed unless Congress 
changes U.S. Code 49, section 32904(c). My amendment does not change 
that section. My amendment only changes section 32908, which has to do 
with the data that underlies vehicle stickers.
  Now, the EPA has changed its testing procedures at least twice since 
1975. It did not add a lot of cost. It was not a big problem. It is an 
EPA center that does this testing. And every time they changed their 
testing procedures for the sticker purpose, they did not change it for 
the CAFE standard purpose, because to do that, you have to change 
section 32904, and my amendment does not change section 32904.
  So I am sorry we have not been able to communicate well enough about 
this, because I certainly do not want to cost manufacturing jobs. I am 
a big advocate of manufacturing. But I do want consumers to have honest 
information. And the adjustment in information that the Rogers 
amendment to my amendment brings is an amendment that will bring down 
the miles per gallon for those that are high achievers and bring it up 
for those who are actually low achievers. So it actually makes the 
problem worse rather than better.
  So I urge the body to oppose the Rogers amendment and support the 
Johnson amendment, because the Rogers amendment has the effect of 
gutting my amendment, whereas my amendment does not address the CAFE 
standards section of the law, which is section 32904(c) and only 
addresses the vehicle sticker section of the law, 32908.
  Mr. Chairman, I reserve the balance of my time.
  Mr. HOLT. Mr. Chairman, will the gentlewoman yield?
  Mrs. JOHNSON of Connecticut. Mr. Chairman, I yield the balance of my 
time to the gentleman from New Jersey (Mr. Holt).
  Mr. HOLT. Mr. Chairman, on the second order amendment, how much time 
does the gentlewoman from Connecticut have remaining?
  The Acting CHAIRMAN (Mr. Simpson). The gentleman from New Jersey (Mr. 
Holt) has 1\1/2\ minutes remaining on the original bill and the 
gentlewoman from Connecticut (Mrs. Johnson) has \1/2\ minute remaining 
on the perfecting amendment.
  Mrs. JOHNSON of Connecticut. Mr. Chairman, I yield the balance of my 
time to the gentleman from New Jersey (Mr. Holt).
  The Acting CHAIRMAN. The gentleman may use his 1\1/2\ minutes also.
  Mr. HOLT. Mr. Chairman, I yield myself 2 minutes, and I thank my 
colleague for yielding her time to me.
  Mr. Chairman, to begin to address the second order amendment, which, 
as I say, may be technically and in parliamentary terms called a 
perfecting amendment, but in fact it would gut the amendment, it does 
not get at the heart of the problem, which is that the tests are wrong. 
The tests are unrealistic. The tests give results that bear no 
relationship to reality.
  Why should taxpayers pay for a test, a government-mandated test, or 
auto purchasers pay for a test that gives inaccurate information? We 
need to fix the EPA test. It can be fixed without giving the folks in 
the State of Michigan or other automobile manufacturing areas 
heartburn. It does not change the fleet average calculation. It only 
addresses the issue of consumer information, so that the purchaser will 
have accurate information.
  If you use this scale factor, or fudge factor, it will paper over the 
underlying problem. It will distort the fuel efficiency difference 
between different types of vehicles. In fact, my colleague earlier 
talked about how some hybrid vehicles behave differently under 
different situations.
  The tests themselves need to be changed, not an after-the-fact fudge 
factor, so that when you go into the showroom to purchase a car and you 
see the number in the window for city mileage and highway mileage, you 
will have a reasonable expectation that that car, when used on actual 
American streets and actual American highways, will give mileage 
comparable to what is posted there.
  The ad says your actual mileage may vary. The way it is today, with 
the tests that we have, your actual mileage may bear no relationship 
whatsoever to what is printed in the window. That is what we are trying 
to correct with the Johnson-Holt amendment. The Rogers second order 
amendment completely changes the nature of what we are trying to do.
  Mr. ROGERS of Michigan. Mr. Chairman, I yield 1 minute to the 
distinguished gentleman from Michigan (Mr. Schwarz), a great public 
servant.
  Mr. SCHWARZ of Michigan. Mr. Chairman, the Johnson amendment requires 
the EPA to change the testing procedures that auto companies use to 
determine the fuel economy numbers that go on the dealer label. Her 
amendment requires auto companies to do one test for labeling and a 
separate test for CAFE. The language in this amendment costs the 
companies approximately twice as much as the simpler testing they are 
doing now. This goes to the heart of what we are doing to the auto 
industry now, unintentionally perhaps, and that is beating up on them; 
and we should not do that.
  The Rogers amendment deals with the need for improved dealer label 
accuracy, while only requiring one test. Instead of requiring the EPA 
to change testing procedures, the Rogers amendment requires the EPA to 
change the adjustment factors that the EPA currently uses to make the 
fuel economy label accurate.
  This is the way to go. It achieves the goal we all want to have, 
accuracy, in a much more reasonable and a much less expensive way. It 
is not a fudge.
  Mr. ROGERS of Michigan. Mr. Chairman, the gentleman from Michigan, a 
medical doctor, said it all so well, I yield back the balance of my 
time.
  The Acting CHAIRMAN. The question is on the amendment offered by the 
gentleman from Michigan (Mr. Rogers) to the amendment offered by the 
gentlewoman from Connecticut (Mrs. Johnson).
  The question was taken; and the Acting Chairman announced that the 
ayes appeared to have it.
  Mr. HOLT. Mr. Chairman, I demand a recorded vote.
  The Acting CHAIRMAN. Pursuant to clause 6 of rule XVIII, further 
proceedings on the amendment offered by

[[Page 7273]]

the gentleman from Michigan (Mr. Mike Rogers) will be postponed.
  It is now in order to consider amendment No. 7 printed in House 
Report 109-49.


           Amendment No. 7 Offered by Mr. Bishop of New York

  Mr. BISHOP of New York. Mr. Chairman, I offer an amendment.
  The Acting CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 7 offered by Mr. Bishop of New York:
       In section 109(2), at the end of the quoted material insert 
     the following new paragraph:
       ``(4) All housing constructed under the military housing 
     privatization initiative of the Department of Defense shall, 
     to the maximum extent practicable--
       ``(A) meet Federal building energy efficiency standards 
     under this section; and
       ``(B) include Energy Star appliances.
       In title I, subtitle A, add at the end the following new 
     section:

     SEC. 112. MODEL BUILDING ENERGY CODE COMPLIANCE GRANT 
                   PROGRAM.

       (a) In General.--The Secretary shall carry out a program to 
     provide grants to each State that the Secretary determines, 
     with respect to new buildings in the State, achieves at least 
     a 90-percent rate of compliance (based on energy performance) 
     with the most recent model building energy codes.
       (b) Guidelines.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary shall issue guidelines 
     that standardize criteria by which a State that seeks to 
     receive a grant under this section may--
       (1) verify compliance with applicable model building energy 
     codes; and
       (2) demonstrate eligibility to receive a grant under this 
     section.
       (c) Local Government Codes.--In the case of a State in 
     which building energy codes are established by local 
     governments--
       (1) A local government may--
       (A) apply for a grant under this section; and
       (B) verify compliance, and demonstrate eligibility, for the 
     grant under subsection (b); and
       (2) if the Secretary determines that the local government 
     is eligible to receive a grant, the Secretary may provide a 
     grant to the local government.
       (d) Use of Funds.--Funds from a grant provided under this 
     section may be used only to carry out activities relating to 
     the implementation of building energy codes and beyond-code 
     building practices.
       (e) Authorization of Appropriations.--
       (1) In general.--There is authorized to be appropriated to 
     carry out this section $25,000,000 for each of fiscal years 
     2006 through 2010.
       (2) Set aside.--Of the amounts authorized to be 
     appropriated under paragraph (1), the Secretary may use not 
     more than $500,000 for each fiscal year--
       (A) to develop compliance guidelines;
       (B) to train State and local officials; and
       (C) to administer grants provided under this section.
       In section 131(a), amend the proposed section 324A(3) to 
     read as follows:
       ``(3) preserve the integrity of the Energy Star label by--
       ``(A) regularly updating Energy Star criteria; and
       ``(B) ensuring, in general, that--
       ``(i) not more than 25 percent of available models in a 
     product class receive the Energy Star designation; and
       ``(ii) Energy Star designated products and buildings are at 
     least 10 percent more efficient than--

       ``(I) appliance standards in effect on the date of 
     enactment of this section; and
       ``(II) the most recent model energy code;

       In section 133(a)(2), add at the end the following new 
     paragraphs:
       ``(45)(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 term `commercial prerinse spray valve' may 
     include (as determined by the secretary by rule) 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 that would meet the 
     criteria specified in subsection (o)(4).
       ``(C) The term `commercial prerinse spray valve' may 
     exclude (as determined by the secretary by rule) 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
       ``(iii) the application of standards to which would not 
     result in significant energy savings.
       ``(46) 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.''.
       In section 133(b)(1), insert after the proposed paragraph 
     (13) the following new paragraphs:
       ``(14) 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.
       ``(15) 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 Prerinse Spray Valves.'''.
       In section 133(c), at the end of the quoted material insert 
     the following new subsections:
       ``(ee) 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)
  .............................................................1.00....

  > 25 -.......................................................1.20....

  > 35 -.......................................................1.30....

  > 54 - < 75..................................................1.50....

  ............................................................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 standards established under 
     paragraph (1) should be amended.
       ``(B) The final rule shall contain any amendment by the 
     Secretary and shall provide that the amendment shall apply 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)
  .............................................................1.20....

  > 25 -.......................................................1.30....

  > 35 -.......................................................1.40....

  > 45 -.......................................................1.50....

  > 54 - < 75..................................................1.60....

  .............................................................2.5.....

       ``(ff) Commercial Prerinse Spray Valves.--Commercial 
     prerinse spray valves manufactured on or after January 1, 
     2006, shall have a flow rate less than or equal to 1.6 
     gallons per minute.
       ``(gg) Standards for Certain Furnaces.--(1) Notwithstanding 
     subsection (f) and except as provided in paragraphs (2) and 
     (3), a furnace (including a furnace designed solely for 
     installation in a mobile home) manufactured 3 or more years 
     after the date of enactment of this subsection shall have an 
     annual fuel utilization efficiency of--
       ``(A) for natural gas- and propane-fired equipment, not 
     less than 80 percent; and
       ``(B) for oil-fired equipment not less than 83 percent.
       ``(2)(A) Notwithstanding subsection (f) and except as 
     provided in paragraph (3)--
       ``(i) a boiler (other than a gas steam boiler) manufactured 
     3 or more years after the date of enactment of this 
     subsection shall have an annual fuel utilization efficiency 
     of not less than 84 percent; and
       ``(ii) a gas steam boiler manufactured 3 or more years 
     after the date of enactment of this subsection shall have an 
     annual fuel utilization efficiency of not less than 82 
     percent.
       ``(B)(i) Notwithstanding subsection (f), if, after the date 
     of enactment of this subsection, the Governor of a cold 
     climate State files with the Secretary a notice that the 
     State has implemented a requirement for an annual fuel 
     utilization efficiency of not less than 90 percent for 
     furnaces (other than boilers and furnaces designed solely for 
     installation in a mobile home or boiler), the annual fuel 
     utilization efficiency of a furnace sold in that State shall 
     be not less than 90 percent.
       ``(ii) If a State described in clause (i) fails to 
     implement or reasonably enforce (as determined by the 
     Secretary) annual fuel utilization efficiency in accordance 
     with that clause, the annual fuel use efficiency for furnaces 
     (other than boilers and furnaces designed solely for 
     installation in a mobile home or boiler) in that State shall 
     be the fuel utilization efficiency established under 
     paragraph (1).
       ``(3)(A) Not later than 5 years after the date on which a 
     standard for a product under this subsection takes effect, 
     the Secretary shall promulgate a final rule to determine 
     whether that standard should be amended.
       ``(B) If the Secretary determines that a standard under 
     subparagraph (A) should be amended--
       ``(i) the final rule promulgated pursuant to subparagraph 
     (A) shall contain the new standard; and

[[Page 7274]]

       ``(ii) the new standard shall apply to any product 
     manufactured after the date that is 5 years after the date on 
     which the final rule is promulgated.''.
       In section 134(b), in the quoted material, insert at the 
     end the following new paragraphs:
       ``(6) In the case of dehumidifiers covered under section 
     325(ee), the Commission shall not require an Energy Guide 
     label.
       ``(7)(A) Not later than July 1, 2006, the Commission shall 
     prescribe by rule, pursuant to this section, labeling 
     requirements for the electricity used by ceiling fans to 
     circulate air in a room.
       ``(B) The requirements shall be based on the test procedure 
     and labeling requirements contained in the Energy Star 
     Program Requirements for Residential Ceiling Fans, version 
     2.0, issued by the Environmental Protection Agency, except 
     that third party testing and other non-labeling requirements 
     shall not be promulgated unless the Commission determines the 
     requirements are necessary to achieve compliance.
       ``(C) The rule shall apply to products manufactured after 
     the later of--
       ``(i) January 1, 2007; or
       ``(ii) the date that is 60 days after the final rule is 
     prescribed.''.
       In section 135, in the proposed subsection (h), insert ``, 
     upon adoption of a standard under this Act'' after ``fan 
     light kits''.
       In title I, subtitle, C, add at the end the following new 
     section:

     SEC. 137. COMMERCIAL PACKAGE AIR CONDITIONING AND HEATING 
                   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 (E) through (H), respectively; and
       (B) by inserting after subparagraph (C) the following:
       ``(D) Very large commercial package air conditioning and 
     heating equipment.'';
       (2) in paragraph (2)(B), by striking ``small and large'';
       (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 at or above 
     135,000 Btu per hour and 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 at or 
     above 240,000 Btu per hour and below 760,000 Btu per hour 
     (cooling capacity).'';
       (4) by redesignating paragraphs (10) through (18) as 
     paragraphs (9) through (17), respectively; and
       (5) in paragraph (10) (as redesignated by subparagraph 
     (D)), by inserting ``, except for gas unit heaters and gas 
     duct furnaces'' after ``furnaces''.
       (b) Standards.--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,'';
       (4) in paragraph (4), by inserting ``, except for a gas 
     unit heater or gas duct furnace,'' after ``boiler'';
       (5) 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 would result in significant additional 
     conservation of energy and is technologically feasible and 
     economically justified.
       ``(iii) This subparagraph does not apply to gas-fired warm-
     air furnaces, gas-fired package boilers, storage water 
     heaters, gas unit heaters, or gas duct furnaces manufactured 
     5 or more years after the date of enactment of the National 
     Energy Efficiency Policy Act of 2005.''; 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
       (6) by adding at the end the following:
       ``(7) Each 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) Each 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) Each 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).
       ``(10) Notwithstanding paragraph (4) and except as provided 
     in paragraph (14), the minimum thermal efficiency at the 
     maximum rated capacity of a gas-fired warm-air furnace with 
     the capacity of 225,000 Btu per hour or more manufactured 4 
     or more years after the date of enactment of this paragraph 
     shall be 79.5 percent.
       ``(11) Notwithstanding paragraph (4) and except as provided 
     in paragraph (14), the minimum combustion efficiency at the 
     maximum rated capacity of a gas-fired package boiler with the 
     capacity of 300,000 Btu per

[[Page 7275]]

     hour or more manufactured 4 or more years after the date of 
     enactment of this paragraph shall be 84 percent.
       ``(12) Notwithstanding paragraph (5) (excluding paragraph 
     (5)(g)), and except as provided in paragraph (14)--
       ``(A) the maximum standby loss (expressed as a percent per 
     hour) of a gas-fired storage water heater shall be 1.30 
     (expressed as a measurement of storage volume in gallons); 
     and
       ``(B) the minimal thermal efficiency of a gas-fired storage 
     water heater shall be 82 percent.
       ``(13) Except as provided in paragraph (14), each gas unit 
     heater and gas duct furnace manufactured 3 or more years 
     after the date of enactment of this paragraph shall be 
     equipped with--
       ``(A) an intermittent ignition device; and
       ``(B)(i) power venting; or
       ``(ii) an automatic flue damper.
       ``(14)(A) Not later than 5 years after the date on which a 
     standard for a product under paragraph (10), (11), (12), or 
     (13) takes effect, the Secretary shall promulgate a final 
     rule to determine whether the standard for that product 
     should be amended.
       ``(B) If the Secretary determines that a standard should be 
     amended under subparagraph (A)--
       ``(i) the final rule promulgated pursuant to subparagraph 
     (A) shall contain the new standard; and
       ``(ii) the new standard shall apply to any product 
     manufactured 4 or more years after the date on which the 
     final rule is promulgated.''.
       (c) Test Procedures.--Section 343 of the Energy Policy and 
     Conservation Act (42 U.S.C. 6314) is amended in subsections 
     (a)(4) and (d)(1), by inserting ``very large commercial 
     package air conditioning and heating equipment,'' after 
     ``large commercial package air conditioning and heating 
     equipment,'' each place it appears.
       (d) Labeling.--Section 344(e) of the Energy Policy and 
     Conservation Act (42 U.S.C. 6315(e)) is amended in the first 
     and second sentences, by inserting ``very large commercial 
     package air conditioning and heating equipment,'' after 
     ``large commercial package air conditioning and heating 
     equipment,'' each place it appears.
       (e) Administration, Penalties, Enforcement, and 
     Preemption.--Section 345 of the Energy Policy and 
     Conservation Act (42 U.S.C. 6316) is amended by adding at the 
     end the following:
       ``(d)(1) Except as provided in paragraphs (2) and (3), 
     section 327 shall apply with respect to the equipment 
     specified in section 340(1)(D) 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 prescribed or enacted 
     prior to 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.
       ``(3) If the California Energy Commission adopts, not later 
     than March 31, 2005, a regulation concerning the energy 
     efficiency or energy effective after, the standards 
     established under section 342(a)(9) take effect on January 1, 
     2010.''.
       In section 304, insert at the end the following: ``In 
     determining whether to defer such acquisition, the Secretary 
     shall use market-based practices when deciding to acquire 
     petroleum for the Strategic Petroleum Reserve, as used prior 
     to 2002; carry out and make public analyses of costs and 
     savings when making or deferring such acquisitions; take into 
     account and report to Congress the impact the acquisition 
     will have on the domestic and foreign supply of petroleum and 
     the resulting price increases or decreases; and consult with 
     the Secretary of Homeland Security on the security 
     consequences of such acquisition or deferral.''.
       In title III, subtitle A, add at the end the following new 
     section:

     SEC. 305. SENSE OF THE HOUSE OF REPRESENTATIVES.

       It is the sense of the House of Representatives that, to 
     address the crude oil price problem in the short-term, the 
     President should communicate immediately to the members of 
     the Organization of Petroleum Exporting Countries (OPEC) 
     cartel and non-OPEC countries that participate in the cartel 
     of crude oil producing countries that--
       (1) the United States seeks to maintain strong relations 
     with crude oil producers around the world while promoting 
     international efforts to remove barriers to energy trade and 
     investment and increased access for United States energy 
     firms around the world;
       (2) the United States believes that restricting supply in a 
     market that is in demand for additional crude oil does 
     serious damage to the efforts that OPEC members have made to 
     demonstrate that they represent a reliable source of crude 
     oil supply;
       (3) the United States believes that stable crude oil prices 
     and supplies are essential for strong economic growth 
     throughout the world;
       (4) the United States seeks an immediate increase in the 
     OPEC crude oil production quotas; and
       (5) the United States will temporarily suspend further 
     purchases of crude oil for the Strategic Petroleum Reserve, 
     thereby freeing up additional supply for the marketplace.
       Amend section 355 to read as follows (and amend the table 
     of contents accordingly):

     SEC. 355. 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.
       Title XII is amended by striking sections 1201 through 1235 
     and sections 1237 through 1298, by striking the title 
     heading, by inserting the following before title XIII, by 
     redesignating section 1236 (relating to native load service 
     obligation) as section 1233 of the following and inserting 
     such redesignated section 1233 after section 1232 of the 
     following, and by making the necessary conforming changes in 
     the table of contents:

                         TITLE XII--ELECTRICITY

     SEC. 1201. SHORT TITLE.

       This title may be cited as the ``Electric Reliability 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 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 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).
       ``(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 issu-
     ance 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;

[[Page 7276]]

       ``(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.

     The total amount of all dues, fees, and other charges 
     collected by the ERO in each of the fiscal years 2006 through 
     2015 and allocated under subparagraph (B) shall not exceed 
     $50,000,000.
       ``(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 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

[[Page 7277]]

     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) Limitation on Annual Appropriations.--There is 
     authorized to be appropriated not mroe than $50,000,000 per 
     year for fiscal years 2006 through 2015 for all activities 
     under the amendment made by subsection (a).

            Subtitle B--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 the following new 
     section:

     ``SEC. 211A. OPEN ACCESS BY UNREGULATED TRANSMITTING 
                   UTILITIES.

       ``(a) Transmission 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 such unregulated 
     transmitting utility provides transmission services to itself 
     and that are not unduly discriminatory or preferential.
       ``(b) Exemption.--The Commission shall exempt from any rule 
     or order under this section any unregulated transmitting 
     utility that--
       ``(1) sells no more than 4,000,000 megawatt hours of 
     electricity per year; or
       ``(2) does not own or operate any transmission facilities 
     that are necessary for operating an interconnected 
     transmission system (or any portion thereof); or
       ``(3) meets other criteria the Commission determines to be 
     in the public interest.
       ``(c) Local Distribution Facilities.--The requirements of 
     subsection (a) shall not apply to facilities used in local 
     distribution.
       ``(d) Exemption Termination.--Whenever the Commission, 
     after an evidentiary hearing held upon 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 (b) unreasonably impairs the continued reliability 
     of an interconnected transmission system, it shall revoke the 
     exemption granted to that transmitting utility.
       ``(e) 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.
       ``(f) Remand.--In exercising its authority under paragraph 
     (1) of subsection (a), the Commission may remand transmission 
     rates to an unregulated transmitting utility for review and 
     revision where necessary to meet the requirements of 
     subsection (a).
       ``(g) Other Requests.--The provision of transmission 
     services under subsection (a) does not preclude a request for 
     transmission services under section 211.
       ``(h) 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 (26 U.S.C. 141).
       ``(i) 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 an RTO 
     or any other Commission-approved independent transmission 
     organization designated to provide nondiscriminatory 
     transmission access.
       ``(j) Definition.--For purposes of 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).''.

     SEC. 1232. FEDERAL UTILITY PARTICIPATION IN REGIONAL 
                   TRANSMISSION ORGANIZATIONS.

       (a) Definitions.--For purposes of this section--
       (1) Appropriate federal regulatory authority.--The term 
     ``appropriate Federal regulatory authority'' means--
       (A) with respect to a Federal power marketing agency (as 
     defined in the Federal Power Act), the Secretary of Energy, 
     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 that Federal power marketing agency; and
       (B) with respect to the Tennessee Valley Authority, the 
     Board of Directors of the Tennessee Valley Authority.
       (2) Federal utility.--The term ``Federal utility'' means a 
     Federal power marketing agency or the Tennessee Valley 
     Authority.
       (3) Transmission system.--The term ``transmission system'' 
     means electric transmission facilities owned, leased, or 
     contracted for by the United States and operated by a Federal 
     utility.
       (b) Transfer.--The appropriate Federal regulatory authority 
     is authorized to enter into a contract, agreement or other 
     arrangement transferring control and use of all or part of 
     the Federal utility's transmission system to an RTO or ISO 
     (as defined in the Federal Power Act), approved by the 
     Federal Energy Regulatory Commission. Such 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 necessary or appropriate, including standards that 
     assure recovery of all the Federal utility's costs and 
     expenses related to the transmission facilities that are the 
     subject of the contract, agreement or other arrangement; 
     consistency with existing contracts and third-party financing 
     arrangements; and consistency with said Federal utility's 
     statutory authorities, obligations, and limitations;
       (2) provisions for monitoring and oversight by the Federal 
     utility of the RTO's or ISO's fulfillment of the 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 regional 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 RTO or ISO and terminate the contract, agreement or 
     other arrangement in accordance with its terms.

     Neither this section, actions taken pursuant to it, nor any 
     other transaction of a Federal utility using an RTO or ISO 
     shall confer upon the Federal Energy Regulatory Commission 
     jurisdiction or authority over the Federal utility's electric 
     generation assets, electric capacity or energy that the 
     Federal utility is authorized by law to market, or the 
     Federal utility's power sales activities.
       (c) Existing Statutory and Other Obligations.--
       (1) System operation requirements.--No statutory provision 
     requiring or authorizing a Federal utility to transmit 
     electric power or to construct, operate or maintain its 
     transmission system shall be construed to prohibit a transfer 
     of control and use of its transmission system pursuant to, 
     and subject to all requirements of subsection (b).
       (2) Other obligations.--This subsection shall not be 
     construed to--
       (A) suspend, or exempt any Federal utility from, any 
     provision of existing Federal law, including but not limited 
     to any requirement or direction relating to the use of the 
     Federal utility's transmission system, environmental 
     protection, fish and wildlife protection, flood control, 
     navigation, water delivery, or recreation; or
       (B) authorize abrogation of any contract or treaty 
     obligation.
       (3) Repeal.--Section 311 of title III of Appendix B of the 
     Act of October 27, 2000 (P.L. 106-377, section 1(a)(2); 114 
     Stat. 1441, 1441A-80; 16 U.S.C. 824n) is repealed.

                    Subtitle C--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

[[Page 7278]]

     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 Utilities 
     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; and
       ``(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.
       ``(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 Utilities 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 of Energy 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;

[[Page 7279]]

       (C) the annual resource contribution of demand resources;
       (D) the potential for demand response as a quantifiable, 
     reliable resource for regional planning purposes; and
       (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.
       (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, and the deployment of such technology and devices 
     that enable electricity customers to participate in such 
     pricing and demand response systems shall be facilitated. 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).''.

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

     SEC. 1282. 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. 221. PROHIBITION ON FILING FALSE INFORMATION.

       ``No person or other 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 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 such 
     Federal agency.

     ``SEC. 222. PROHIBITION ON ROUND TRIP TRADING.

       ``(a) Prohibition.--No person or other entity (including an 
     entity described in section 201(f)) shall willfully and 
     knowingly enter into any contract or other arrangement to 
     execute a `round trip trade' for the purchase or sale of 
     electric energy at wholesale.
       ``(b) Definition.--For the purposes of this section, the 
     term `round trip trade' means a transaction, or combination 
     of transactions, in which a person or any other entity--
       ``(1) enters into a contract or other arrangement to 
     purchase from, or sell to, any other person or other entity 
     electric energy at wholesale;
       ``(2) simultaneously with entering into the contract or 
     arrangement described in paragraph (1), arranges a 
     financially offsetting trade with such other person or entity 
     for the same such electric energy, at the same location, 
     price, quantity and terms so that, collectively, the purchase 
     and sale transactions in themselves result in no financial 
     gain or loss; and
       ``(3) enters into the contract or arrangement with a 
     specific intent to fraudulently affect reported revenues, 
     trading volumes, or prices.''.

     SEC. 1283. FRAUDULENT OR MANIPULATIVE PRACTICES.

       (a) Unlawful Acts.--It shall be unlawful for any entity, 
     directly or indirectly, by the use of any means or 
     instrumentality of interstate commerce or of the mails to use 
     or employ, in 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, or the sale in interstate commerce of 
     natural gas for resale for ultimate public consumption for 
     domestic, commercial, industrial, or any other use, any 
     fraudulent, manipulative, or deceptive device or contrivance 
     in contravention of such rules and regulations as the Federal 
     Energy Regulatory Commission may prescribe as necessary or 
     appropriate in the public interest.
       (b) Application of Federal Power Act to This Act.--The 
     provisions of section 307 through 309 and 313 through 317 of 
     the Federal Power Act shall apply to violations of the 
     Electric Reliability Act of 2005 in the same manner and to 
     the same extent as such provisions apply to entities subject 
     to Part II of the Federal Power Act.

     SEC. 1284. RULEMAKING ON EXEMPTIONS, WAIVERS, ETC UNDER 
                   FEDERAL POWER ACT.

        Part III of the Federal Power Act is amended by inserting 
     the following new section after section 319 and by 
     redesignating sections 320 and 321 as sections 321 and 322, 
     respectively:

     ``SEC. 320. CRITERIA FOR CERTAIN EXEMPTIONS, WAIVERS, ETC.

       ``(a) Rule Required for Certain Waivers, Exemptions, Etc.--
     Not later than 6 months after the enactment of this Act, the 
     Commission shall promulgate a rule establishing specific 
     criteria for providing an exemption, waiver, or other reduced 
     or abbreviated form of compliance with the requirements of 
     sections 204, 301, 304, and 305 (including any prospective 
     blanket order). Such criteria shall be sufficient to insure 
     that any such action taken by the Commission will be 
     consistent with the purposes of such requirements and will 
     otherwise protect the public interest.
       ``(b) Moratorium on Certain Waivers, Exemptions, Etc.--
     After the date of enactment of this section, the Commission 
     may not issue, adopt, order, approve, or promulgate any 
     exemption, waiver, or other reduced or abbreviated form of 
     compliance with the requirements of section 204, 301, 304, or 
     305 (including any prospective blanket order) until after the 
     rule promulgated under subsection (a) has taken effect.
       ``(c) Previous Ferc Action.--The Commission shall undertake 
     a review, by rule or order, of each exemption, waiver, or 
     other reduced or abbreviated form of compliance described in 
     subsection (a) that was taken before the date of enactment of 
     this section. No such action may continue in force and effect 
     after the date 18 months after the date of enactment of this 
     section unless the Commission finds that such action complies 
     with the rule under subsection (a).
       ``(d) Exemption Under 204(f) not Applicable.--For purposes 
     of this section, in applying section 204, the provisions of 
     section 204(f) shall not apply.''.

     SEC. 1285. REPORTING REQUIREMENTS IN ELECTRIC POWER SALES AND 
                   TRANSMISSION.

       (a) Audit Trails.--Section 304 of the Federal Power Act is 
     amended by adding the following new subsection at the end 
     thereof:
       ``(c)(1) The Commission shall, by rule or order, require 
     each person or other entity engaged in the transmission of 
     electric energy in interstate commerce or the sale of 
     electric energy at wholesale in interstate commerce, and each 
     broker, dealer, and power marketer involved in any such 
     transmission or sale, to maintain, and periodically submit to 
     the Commission, such records, in electronic form, of each 
     transaction relating to such transmission or sale as may be 
     necessary to determine whether any person has employed any 
     fraudulent, manipulative, or deceptive device or contrivance 
     in contravention of rules promulgated by the Commission.
       ``(2) Section 201(f) shall not limit the application of 
     this subsection.''.
       (b) Natural Gas.--Section 8 of the Natural Gas Act is 
     amended by adding the following new subsection at the end 
     thereof:
       ``(d) The Commission shall, by rule or order, require each 
     person or other entity engaged in the transportation of 
     natural gas in interstate commerce, or the sale in interstate 
     commerce of natural gas for resale for

[[Page 7280]]

     ultimate public consumption for domestic, commercial, 
     industrial, or any other use, and each broker, dealer, and 
     power marketer involved in any such transportation or sale, 
     to maintain, and periodically submit to the Commission, such 
     records, in electronic form, of each transaction relating to 
     such transmission or sale as may be necessary to determine 
     whether any person has employed any fraudulent, manipulative, 
     or deceptive device or contrivance in contravention of rules 
     promulgated by the Commission.''.

     SEC. 1286. TRANSPARENCY.

       (a) Definition.--As used in this section the term 
     ``electric power or natural gas information processor'' means 
     any person engaged in the business of--
       (1) collecting, processing, or preparing for distribution 
     or publication, or assisting, participating in, or 
     coordinating the distribution or publication of, information 
     with respect to transactions in or quotations involving the 
     purchase or sale of electric power, natural gas, the 
     transmission of electric energy, or the transportation of 
     natural gas, or
       (2) distributing or publishing (whether by means of a 
     ticker tape, a communications network, a terminal display 
     device, or otherwise) on a current and continuing basis, 
     information with respect to such transactions or quotations.

     The term does not include any bona fide newspaper, news 
     magazine, or business or financial publication of general and 
     regular circulation, any self-regulatory organization, any 
     bank, broker, dealer, building and loan, savings and loan, or 
     homestead association, or cooperative bank, if such bank, 
     broker, dealer, association, or cooperative bank would be 
     deemed to be an electric power or natural gas information 
     processor solely by reason of functions performed by such 
     institutions as part of customary banking, brokerage, 
     dealing, association, or cooperative bank activities, or any 
     common carrier, as defined in section 3 of the Communications 
     Act of 1934, subject to the jurisdiction of the Federal 
     Communications Commission or a State commission, as defined 
     in section 3 of that Act, unless the Commission determines 
     that such carrier is engaged in the business of collecting, 
     processing, or preparing for distribution or publication, 
     information with respect to transactions in or quotations 
     involving the purchase or sale of electric power, natural 
     gas, the transmission of electric energy, or the 
     transportation of natural gas.
       (b) Prohibition.--No electric power or natural gas 
     information processor may make use of the mails or any means 
     or instrumentality of interstate commerce--
       (1) to collect, process, distribute, publish, or prepare 
     for distribution or publication any information with respect 
     to quotations for, or transactions involving the purchase or 
     sale of electric power, natural gas, the transmission of 
     electric energy, or the transportation of natural gas, or
       (2) to assist, participate in, or coordinate the 
     distribution or publication of such information in 
     contravention of such rules and regulations as the Federal 
     Energy Regulatory Commission shall prescribe as necessary or 
     appropriate in the public interest to
       (A) prevent the use, distribution, or publication of 
     fraudulent, deceptive, or manipulative information with 
     respect to quotations for and transactions involving the 
     purchase or sale of electric power, natural gas, the 
     transmission of electric energy, or the transportation of 
     natural gas;
       (B) assure the prompt, accurate, reliable, and fair 
     collection, processing, distribution, and publication of 
     information with respect to quotations for and transactions 
     involving the purchase or sale of electric power, natural 
     gas, the transmission of electric energy, or the 
     transportation of natural gas, and the fairness and 
     usefulness of the form and content of such information;
       (C) assure that all such information processors may, for 
     purposes of distribution and publication, obtain on fair and 
     reasonable terms such information with respect to quotations 
     for and transactions involving the purchase or sale of 
     electric power, natural gas, the transmission of electric 
     energy, or the transportation of natural gas as is collected, 
     processed, or prepared for distribution or publication by any 
     exclusive processor of such information acting in such 
     capacity;
       (D) assure that, subject to such limitations as the 
     Commission, by rule, may impose as necessary or appropriate 
     for the maintenance of fair and orderly markets, all persons 
     may obtain on terms which are not unreasonably discriminatory 
     such information with respect to quotations for and 
     transactions involving the purchase or sale of electric 
     power, natural gas, the transmission of electric energy, or 
     the transportation of natural gas as is published or 
     distributed by any electric power or natural gas information 
     processor;
       (E) assure that all electricity and natural gas electronic 
     communication networks transmit and direct orders for the 
     purchase and sale of electricity or natural gas in a manner 
     consistent with the establishment and operation of an 
     efficient, fair, and orderly market system for electricity 
     and natural gas; and
       (F) assure equal regulation of all markets involving the 
     purchase or sale of electric power, natural gas, the 
     transmission of electric energy, or the transportation of 
     natural gas and all persons effecting transactions involving 
     the purchase or sale of electric power, natural gas, the 
     transmission of electric energy, or the transportation of 
     natural gas.
       (c) Related Commodities.--For purposes of this section, the 
     phrase ``purchase or sale of electric power, natural gas, the 
     transmission of electric energy, or the transportation of 
     natural gas'' includes the purchase or sale of any commodity 
     (as defined in the Commodities Exchange Act) relating to any 
     such purchase or sale if such commodity is excluded from 
     regulation under the Commodities Exchange Act pursuant to 
     section 2 of that Act.
       (d) Prohibition.--No person who owns, controls, or is under 
     the control or ownership of a public utility, a natural gas 
     company, or a public utility holding company may own, 
     control, or operate any electronic computer network or other 
     mulitateral trading facility utilized to trade electricity or 
     natural gas.

     SEC. 1287. PENALTIES.

       (a) Criminal Penalties.--Section 316 of the Federal Power 
     Act (16 U.S.C. 825o(c)) is amended as follows:
       (1) By striking ``$5,000'' in subsection (a) and inserting 
     ``$5,000,000 for an individual and $25,000,000 for any other 
     defendant'' and by striking out ``two years'' and inserting 
     ``five years'' .
       (2) By striking ``$500'' in subsection (b) and inserting 
     ``$1,000,000''.
       (3) By striking subsection (c).
       (b) Civil Penalties.--Section 316A of the Federal Power Act 
     (16 U.S.C. 825o091) is amended as follows:
       (1) By striking ``section 211, 212, 213, or 214'' each 
     place it appears and inserting ``Part II''.
       (2) By striking ``$10,000 for each day that such violation 
     continues'' and inserting ``the greater of $1,000,000 or 
     three times the profit made or gain or loss avoided by reason 
     of such violation''.
       (3) By adding the following at the end thereof:
       ``(c) Authority of a Court to Prohibit Persons From Certain 
     Activities.--In any proceeding under this section, the court 
     may censure, place limitations on the activities, functions, 
     or operations of, suspend or revoke the ability of any entity 
     (without regard to section 201(f)) to participate in the 
     transmission of electric energy in interstate commerce or the 
     sale of electric energy at wholesale in interstate commerce 
     if it finds that such censure, placing of limitations, 
     suspension, or revocation is in the public interest and that 
     one or more of the following applies to such entity:
       ``(1) Such entity has willfully made or caused to be made 
     in any application or report required to be filed with the 
     Commission or with any other appropriate regulatory agency, 
     or in any proceeding before the Commission, any statement 
     which was at the time and in the light of the circumstances 
     under which it was made false or misleading with respect to 
     any material fact, or has omitted to state in any such 
     application or report any material fact which is required to 
     be stated therein.
       ``(2) Such entity has been convicted of any felony or 
     misdemeanor or of a substantially equivalent crime by a 
     foreign court of competent jurisdiction which the court 
     finds--
       ``(A) involves the purchase or sale of electricity, the 
     taking of a false oath, the making of a false report, 
     bribery, perjury, burglary, any substantially equivalent 
     activity however denominated by the laws of the relevant 
     foreign government, or conspiracy to commit any such offense;
       ``(B) arises out of the conduct of the business of 
     transmitting electric energy in interstate commerce or 
     selling or purchasing electric energy at wholesale in 
     interstate commerce;
       ``(C) involves the larceny, theft, robbery, extortion, 
     forgery, counterfeiting, fraudulent concealment, 
     embezzlement, fraudulent conversion, or misappropriation of 
     funds, or securities, or substantially equivalent activity 
     however denominated by the laws of the relevant foreign 
     government; or
       ``(D) involves the violation of section 152, 1341, 1342, or 
     1343 or chapter 25 or 47 of title 18, United States Code, or 
     a violation of a substantially equivalent foreign statute.
       ``(3) Such entity is permanently or temporarily enjoined by 
     order, judgment, or decree of any court of competent 
     jurisdiction from acting as an investment adviser, 
     underwriter, broker, dealer, municipal securities dealer, 
     government securities broker, government securities dealer, 
     transfer agent, foreign person performing a function 
     substantially equivalent to any of the above, or entity or 
     person required to be registered under the Commodity Exchange 
     Act or any substantially equivalent foreign statute or 
     regulation, or as an affiliated person or employee of any 
     investment company, bank, insurance company, foreign entity 
     substantially equivalent to any of the above, or entity or 
     person required to be registered under the Commodity Exchange 
     Act or any substantially equivalent foreign statute or 
     regulation, or from engaging in or continuing any conduct or 
     practice in connection with

[[Page 7281]]

     any such activity, or in connection with the purchase or sale 
     of any security.
       ``(4) Such entity has willfully violated any provision of 
     this Act.
       ``(5) Such entity has willfully aided, abetted, counseled, 
     commanded, induced, or procured the violation by any other 
     person of any provision of this Act, or has failed reasonably 
     to supervise, with a view to preventing violations of the 
     provisions of this Act, another person who commits such a 
     violation, if such other person is subject to his 
     supervision. For the purposes of this paragraph no person 
     shall be deemed to have failed reasonably to supervise any 
     other person, if--
       ``(A) there have been established procedures, and a system 
     for applying such procedures, which would reasonably be 
     expected to prevent and detect, insofar as practicable, any 
     such violation by such other person, and
       ``(B) such person has reasonably discharged the duties and 
     obligations incumbent upon him by reason of such procedures 
     and system without reasonable cause to believe that such 
     procedures and system were not being complied with.
       ``(6) Such entity has been found by a foreign financial or 
     energy regulatory authority to have--
       ``(A) made or caused to be made in any application or 
     report required to be filed with a foreign regulatory 
     authority, or in any proceeding before a foreign financial or 
     energy regulatory authority, any statement that was at the 
     time and in the light of the circumstances under which it was 
     made false or misleading with respect to any material fact, 
     or has omitted to state in any application or report to the 
     foreign regulatory authority any material fact that is 
     required to be stated therein;
       ``(B) violated any foreign statute or regulation regarding 
     the transmission or sale of electricity or natural gas;
       ``(C) aided, abetted, counseled, commanded, induced, or 
     procured the violation by any person of any provision of any 
     statutory provisions enacted by a foreign government, or 
     rules or regulations thereunder, empowering a foreign 
     regulatory authority regarding transactions in electricity or 
     natural gas, or contracts of sale of electricity or natural 
     gas, traded on or subject to the rules of a contract market 
     or any board of trade, or has been found, by a foreign 
     regulatory authority, to have failed

     reasonably to supervise, with a view to preventing violations 
     of such statutory provisions, rules, and regulations, another 
     person who commits such a violation, if such other person is 
     subject to his supervision.
       ``(7) Such entity is subject to any final order of a State 
     commission (or any agency or officer performing like 
     functions), State authority that supervises or examines 
     banks, savings associations, or credit unions, State 
     insurance commission (or any agency or office performing like 
     functions), an appropriate Federal banking agency (as defined 
     in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 
     1813(q))), or the National Credit Union Administration, 
     that--
       ``(A) bars such person from association with an entity 
     regulated by such commission, authority, agency, or officer, 
     or from engaging in the business of securities, insurance, 
     banking, savings association activities, or credit union 
     activities; or
       ``(B) constitutes a final order based on violations of any 
     laws or regulations that prohibit fraudulent, manipulative, 
     or deceptive conduct.''
       (4) Such entity is subject to statutory disqualification 
     within the meaning of section 3(a)(39) of the Securities 
     Exchange Act of 1934.''.
       (c) Natural Gas Act Penalties.--Section 21 of the Natural 
     Gas Act is amended by adding the following new subsection at 
     the end thereof:
       ``(c) Authority of a Court to Prohibit Persons From Certain 
     Activities.--In any proceeding under this section, the court 
     may censure, place limitations on the activities, functions, 
     or operations of, suspend or revoke the ability of any entity 
     (without regard to section 201(f)) to participate in the 
     transportation of natural gas in interstate commerce, or the 
     sale in interstate commerce of natural gas for resale for 
     ultimate public consumption for domestic, commercial, 
     industrial, or any other use if it finds that such censure, 
     placing of limitations, suspension, or revocation is in the 
     public interest and that one or more of the following applies 
     to such entity:
       ``(1) Such entity has willfully made or caused to be made 
     in any application or report required to be filed with the 
     Commission or with any other appropriate regulatory agency, 
     or in any proceeding before the Commission, any statement 
     which was at the time and in the light of the circumstances 
     under which it was made false or misleading with respect to 
     any material fact, or has omitted to state in any such 
     application or report any material fact which is required to 
     be stated therein.
       ``(2) Such entity has been convicted of any felony or 
     misdemeanor or of a substantially equivalent crime by a 
     foreign court of competent jurisdiction which the court 
     finds--
       ``(A) involves the purchase or sale of natural gas, the 
     taking of a false oath, the making of a false report, 
     bribery, perjury, burglary, any substantially equivalent 
     activity however denominated by the laws of the relevant 
     foreign government, or conspiracy to commit any such offense;
       ``(B) arises out of the conduct of the business of 
     transmitting natural gas in interstate commerce, or the 
     selling in interstate commerce of natural gas for resale for 
     ultimate public consumption for domestic, commercial, 
     industrial, or any other use;
       ``(C) involves the larceny, theft, robbery, extortion, 
     forgery, counterfeiting, fraudulent concealment, 
     embezzlement, fraudulent conversion, or misappropriation of 
     funds, or securities, or substantially equivalent activity 
     however denominated by the laws of the relevant foreign 
     government; or
       ``(D) involves the violation of section 152, 1341, 1342, or 
     1343 or chapter 25 or 47 of title 18, United States Code, or 
     a violation of a substantially equivalent foreign statute.
       ``(3) Such entity is permanently or temporarily enjoined by 
     order, judgment, or decree of any court of competent 
     jurisdiction from acting as an investment adviser, 
     underwriter, broker, dealer, municipal securities dealer, 
     government securities broker, government securities dealer, 
     transfer agent, foreign person performing a function 
     substantially equivalent to any of the above, or entity or 
     person required to be registered under the Commodity Exchange 
     Act or any substantially equivalent foreign statute or 
     regulation, or as an affiliated person or employee of any 
     investment company, bank, insurance company, foreign entity 
     substantially equivalent to any of the above, or entity or 
     person required to be registered under the Commodity Exchange 
     Act or any substantially equivalent foreign statute or 
     regulation, or from engaging in or continuing any conduct or 
     practice in connection with any such activity, or in 
     connection with the purchase or sale of any security.
       ``(4) Such entity has willfully violated any provision of 
     this Act.
       ``(5) Such entity has willfully aided, abetted, counseled, 
     commanded, induced, or procured the violation by any other 
     person of any provision of this Act, or has failed reasonably 
     to supervise, with a view to preventing violations of the 
     provisions of this Act, another person who commits such a 
     violation, if such other person is subject to his 
     supervision. For the purposes of this paragraph no person 
     shall be deemed to have failed reasonably to supervise any 
     other person, if--
       ``(A) there have been established procedures, and a system 
     for applying such procedures, which would reasonably be 
     expected to prevent and detect, insofar as practicable, any 
     such violation by such other person, and
       ``(B) such person has reasonably discharged the duties and 
     obligations incumbent upon him by reason of such procedures 
     and system without reasonable cause to believe that such 
     procedures and system were not being complied with.
       ``(6) Such entity has been found by a foreign financial or 
     energy regulatory authority to have--
       ``(A) made or caused to be made in any application or 
     report required to be filed with a foreign regulatory 
     authority, or in any proceeding before a foreign financial or 
     energy regulatory authority, any statement that was at the 
     time and in the light of the circumstances under which it was 
     made false or misleading with respect to any material fact, 
     or has omitted to state in any application or report to the 
     foreign regulatory authority any material fact that is 
     required to be stated therein;
       ``(B) violated any foreign statute or regulation regarding 
     the transmission or sale of electricity or natural gas;
       ``(C) aided, abetted, counseled, commanded, induced, or 
     procured the violation by any person of any provision of any 
     statutory provisions enacted by a foreign government, or 
     rules or regulations thereunder, empowering a foreign 
     regulatory authority regarding transactions in electricity or 
     natural gas, or contracts of sale of electricity or natural 
     gas, traded on or subject to the rules of a contract market 
     or any board of trade, or has been found, by a foreign 
     regulatory authority, to have failed reasonably to supervise, 
     with a view to preventing violations of such statutory 
     provisions, rules, and regulations, another person who 
     commits such a violation, if such other person is subject to 
     his supervision.
       ``(7) Such entity is subject to any final order of a State 
     commission (or any agency or officer performing like 
     functions), State authority that supervises or examines 
     banks, savings associations, or credit unions, State 
     insurance commission (or any agency or office performing like 
     functions), an appropriate Federal banking agency (as defined 
     in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 
     1813(q))), or the National Credit Union Administration, 
     that--
       ``(A) bars such person from association with an entity 
     regulated by such commission, authority, agency, or officer, 
     or from engaging in the business of securities, insurance, 
     banking, savings association activities, or credit union 
     activities; or
       ``(B) constitutes a final order based on violations of any 
     laws or regulations that prohibit fraudulent, manipulative, 
     or deceptive conduct.

[[Page 7282]]

       ``(8) Such entity is subject to statutory disqualification 
     within the meaning of section 3(a)(39) of the Securities 
     Exchange Act of 1934.''.

     SEC. 1288. REVIEW OF PUHCA EXEMPTIONS.

        Not later than 12 months after the enactment of this Act 
     the Securities and Exchange Commission shall review each 
     exemption granted to any person under section 3(a) of the 
     Public Utility Holding Company Act of 1935 and shall review 
     the action of persons operating pursuant to a claim of exempt 
     status under section 3 to determine if such exemptions and 
     claims are consistent with the requirements of such section 
     3(a) and whether or not such exemptions or claims of 
     exemption should continue in force and effect.

     SEC. 1289. REVIEW OF ACCOUNTING FOR CONTRACTS INVOLVED IN 
                   ENERGY TRADING.

       Not later than 12 months after the enactment of this Act, 
     the Comptroller General of the United States shall submit to 
     the Congress a report of the results of its review of 
     accounting for contracts in energy trading and risk 
     management activities. The review and report shall include, 
     among other issues, the use of mark-to-market accounting and 
     when gains and losses should be recognized, with a view 
     toward improving the transparency of energy trading 
     activities for the benefit of investors, consumers, and the 
     integrity of these markets.

     SEC. 1290. PROTECTION OF FERC REGULATED SUBSIDIARIES.

        Section 205 of the Federal Power Act is amended by adding 
     after subsection (f) the following new subsection:
       ``(g) Rules and Procedures to Protect Consumers of Public 
     Utilities.--Not later than 9 months after the date of 
     enactment of this Act, the Commission shall adopt rules and 
     procedures for the protection of electric consumers from 
     self-dealing, interaffiliate abuse, and other harmful actions 
     taken by persons owning or controlling public utilities. Such 
     rules shall ensure that no asset of a public utility company 
     shall be used as collateral for indebtedness incurred by the 
     holding company of, and any affiliate of, such public utility 
     company, and no public utility shall acquire or own any 
     securities of the holding company or other affiliates of the 
     holding company unless the Commission has determined that 
     such acquisition or ownership is consistent with the public 
     interest and the protection of consumers of such public 
     utility.''.

     SEC. 1291. REFUNDS UNDER THE FEDERAL POWER ACT.

        Section 206(b) of the Federal Power Act is amended as 
     follows:
       (1) By amending the first sentence to read as follows: ``In 
     any proceeding under this section, the refund effective date 
     shall be the date of the filing of a complaint or the date of 
     the Commission motion initiating the proceeding, except that 
     in the case of a complaint with regard to market-based rates, 
     the Commission may establish an earlier refund effective 
     date.''.
       (2) By striking the second and third sentences.
       (3) By striking out ``the refund effective date or by'' and 
     ``, whichever is earlier,'' in the fifth sentence.
       (4) In the seventh sentence by striking ``through a date 
     fifteen months after such refund effective date'' and insert 
     ``and prior to the conclusion of the proceeding'' and by 
     striking the proviso.

     SEC. 1292. ACCOUNTS AND REPORTS.

        Section 318 of the Federal Power Act is amended by adding 
     the following at the end thereof: ``This section shall not 
     apply to sections 301 and 304 of this Act.''.

     SEC. 1293. MARKET-BASED RATES.

        Section 205 of the Federal Power Act is amended by adding 
     the following new subsection at the end thereof:
       ``(g) For each public utility granted the authority by the 
     Commission to sell electric energy at market-based rates, the 
     Commission shall review the activities and characteristics of 
     such utility not less frequently than annually to determine 
     whether such rates are just and reasonable. Each such utility 
     shall notify the Commission promptly of any change in the 
     activities and characteristics relied upon by the Commission 
     in granting such public utility the authority to sell 
     electric energy at market-based rates. If the Commission 
     finds that:
       ``(1) a rate charged by a public utility authorized to sell 
     electric energy at market-based rates is unjust, 
     unreasonable, unduly discriminatory or preferential,
       ``(2) the public utility has intentionally engaged in an 
     activity that violates any other rule, tariff, or order of 
     the Commission, or
       ``(3) any violation of the Electric Reliability Act of 
     2005,

     the Commission shall issue an order immediately modifying or 
     revoking the authority of that public utility to sell 
     electric energy at market-based rates.''.

     SEC. 1294. ENFORCEMENT.

       (a) Complaints.--Section 306 of the Federal Power Act (16 
     U.S.C. 825e) is amended as follows:
       (1) By inserting ``electric utility,'' after ``Any 
     person,''.
       (2) By inserting ``, transmitting utility,'' after 
     ``licensee'' each place it appears.
       (b) Review of Commission Orders.--Section 313(a) of the 
     Federal Power Act (16 U.S.C. 8251) 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''.
       (c) Investigations.--Section 307(a) of the Federal Power 
     Act (16 U.S.C. 825f(a)) is amended as follows:
       (1) By inserting ``, electric utility, transmitting 
     utility, or other entity'' after ``person'' each time it 
     appears.
       (2) By striking the period at the end of the first sentence 
     and inserting 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.''.

     SEC. 1295. 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).
       ``(d) The Commission shall, by rule or order, require each 
     person or other entity engaged in the transportation of 
     natural gas in interstate commerce, or the sale in interstate 
     commerce of natural gas for resale for ultimate public 
     consumption for domestic, commercial, industrial, or any 
     other use, and each broker, dealer, and power marketer 
     involved in any such transportation or sale, to maintain, and 
     periodically submit to the Commission, such records, in 
     electronic form, of each transaction relating to such 
     transmission or sale as may be necessary to determine whether 
     any person has employed any fraudulent, manipulative, or 
     deceptive device or contrivance in contravention of rules 
     promulgated by the Commission.''.

     SEC. 1296. SAVINGS PROVISION.

       Nothing in this title or in any amendment made by this 
     title shall be construed to affect the authority of any court 
     to make a determination in any proceeding commenced before 
     the enactment of this Act regarding the authority of the 
     Federal Energy Regulatory Commission to permit any person to 
     sell or distribute electric energy at market-based rates.
       In section 25C(b)(1)(A) of the Internal Revenue Code of 
     1986, as proposed to be added by section 1311 of the bill, 
     insert after clause (iii) the following new clauses:
       (iv) $150 for each electric heat pump water heater,
       (v) $200 for each advanced natural gas, oil, propane 
     furnace, or hot water boiler installed in 2006 ($150 for 
     equipment installed in 2007, $100 for equipment installed in 
     2008),
       (vi) $150 for each advanced natural gas, oil, or propane 
     water heater,
       (vii) $50 for each mid-efficiency natural gas, oil, or 
     propane water heater,
       (viii) $50 for an advanced main air circulating fan which 
     is installed in a furnace with an Annual Fuel Utilization 
     Efficiency of less than 92 percent,
       (ix) $150 for each advanced combination space and water 
     heating system,
       (x) $50 for each mid-efficiency combination space and water 
     heating system,
       (xi) $250 for each geothermal heat pump, and
       (xii) $250 for each advanced central air conditioner or 
     central heat pump ($150 for equipment installed in 2008).
       In section 25C(a) of the Internal Revenue Code of 1986, as 
     proposed to be added by section 1311 of the bill, insert 
     after paragraph (3) the following new paragraph:
       (4) the energy efficient building property described in 
     clauses (iv) through (xii) of subsection (b)(1)(A).
       In section 25C(b) of the Internal Revenue Code of 1986, as 
     proposed to be added by section 1311 of the bill, insert 
     after paragraph (2) the following new paragraph:
       (3) Safety certifications.--No credit shall be allowed 
     under this section for an item of

[[Page 7283]]

     property specified in clause (iv) through (xii) of paragraph 
     (1) unless such property meets the performance and quality 
     standards, and the certification requirements (if any), 
     which--
       (A) 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),
       (B) in the case of the energy efficiency ratio (EER) for 
     property described in clause (viii) or (ix) of subsection 
     (d)(1)(B)--
       (i) require measurements to be based on published data 
     which is tested by manufacturers at 95 degrees Fahrenheit, 
     and
       (ii) do not require ratings to be based on certified data 
     of the Air Conditioning and Refrigeration Institute, and
       (C) are in effect at the time of the acquisition of the 
     property.
       In section 25C(c) of the Internal Revenue Code of 1986, as 
     proposed to be added by section 1311 of the bill, add at the 
     end the following new paragraphs:
       (4) 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 1.7 in the standard Department of 
     Energy test procedure,
       (B) an advanced natural gas, oil, propane furnace, or hot 
     water boiler which achieves at least 92 percent annual fuel 
     utilization efficiency (AFUE) and which has an advanced main 
     air circulating fan,
       (C) an advanced natural gas, oil, or propane water heater 
     which has an energy factor of at least 0.80 in the standard 
     Department of Energy test procedure,
       (D) a mid-efficiency natural gas, oil, or propane water 
     heater which has an energy factor of at least 0.65 but less 
     than 0.80 in the standard Department of Energy test 
     procedure,
       (E) an advanced main air circulating fan which has an 
     annual electricity use of no more than 2 percent of the total 
     annual energy use (as determined in the standard Department 
     of Energy test procedures) and which is used in a new natural 
     gas, propane, or oil-fired furnace,
       (F) an advanced combination space and water heating system 
     which has a combined energy factor of at least 0.80 and a 
     combined annual fuel utilization efficiency (AFUE) of at 
     least 78 percent in the standard Department of Energy test 
     procedure,
       (G) a mid-efficiency combination space and water heating 
     system which has a combined energy factor of at least 0.65 
     but less than 0.80 and a combined annual fuel utilization 
     efficiency (AFUE) of at least 78 percent in the standard 
     Department of Energy test procedure,
       (H) a geothermal heat pump which has water heating 
     capability by a desuperheater or full-condensing option and 
     which has an energy efficiency ratio (EER) of at least 18 for 
     ground-loop systems, at least 21 for ground-water systems, 
     and at least 17 for direct GeoExchange systems; and
       (I) a central air conditioner or central heat pump which 
     meets the Energy Star specifications as set by the 
     Environmental Protection Agency. The specifications must be 
     made effective after December 31, 2005, and must be current 
     as of the date of the expenditure or made effective later in 
     the calendar year of the expenditure.
       (5) Labor costs.--Expenditures for labor costs properly 
     allocable to the onsite preparation, assembly, or original 
     installation of the property and for piping or wiring to 
     interconnect property described in paragraph (4) to the 
     dwelling unit shall be taken into account for purposes of 
     this section.
       In subtitle B of title XIII, add at the end the following:

     SEC. 1318. 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) is amended 
     by adding at the end the following new section:

     ``SEC. 45K. NEW ENERGY EFFICIENT HOME CREDIT.

       ``(a) In General.--For purposes of section 38, in the case 
     of an eligible contractor with respect to a qualified new 
     energy efficient home, the credit determined under this 
     section for the taxable year with respect to such home is an 
     amount equal to the aggregate adjusted bases of all energy 
     efficient property installed in such home during construction 
     of such home.
       ``(b) Limitations.--
       ``(1) Maximum credit.--
       ``(A) In general.--The credit allowed by this section with 
     respect to a dwelling unit shall not exceed--
       ``(i) in the case of a dwelling unit described in clause 
     (i) or (iii) of subsection (c)(3)(C), $1,000, and
       ``(ii) in the case of a dwelling unit described in clause 
     (ii) or (iv) of subsection (c)(3)(C), $2,000.
       ``(B) Prior credit amounts on same dwelling unit taken into 
     account.--If a credit was allowed under subsection (a) with 
     respect to a dwelling unit in 1 or more prior taxable years, 
     the amount of the credit otherwise allowable for the taxable 
     year with respect to such dwelling unit shall be reduced by 
     the sum of the credits allowed under subsection (a) with 
     respect to the dwelling unit for all prior taxable years.
       ``(2) Coordination with certain credits.--For purposes of 
     this section--
       ``(A) the basis of any property referred to in subsection 
     (a) shall be reduced by that portion of the basis of any 
     property which is attributable to qualified rehabilitation 
     expenditures (as defined in section 47(c)(2)) or to the 
     energy percentage of energy property (as determined under 
     section 48(a)), and
       ``(B) expenditures taken into account under section 47 or 
     48(a) shall not be taken into account under this section.
       ``(c) 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.

     If more than 1 person is described in subparagraph (A) or (B) 
     with respect to any qualified new energy efficient home, such 
     term means the person designated as such by the owner of such 
     home.
       ``(2) Energy efficient property.--The term `energy 
     efficient property' means any energy efficient building 
     envelope component, and any energy efficient heating or 
     cooling equipment or system, which can, individually or in 
     combination with other components, result in a dwelling unit 
     meeting the requirements of this section.
       ``(3) 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 is--
       ``(i) certified to have a level of annual heating and 
     cooling energy consumption which is at least 30 percent below 
     the annual level of heating and cooling energy consumption of 
     a comparable dwelling unit 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 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 construction, and to have building 
     envelope component improvements account for at least \1/3\ of 
     such 30 percent,
       ``(ii) certified to have a level of annual heating and 
     cooling energy consumption which is at least 50 percent below 
     such annual level and to have building envelope component 
     improvements account for at least \1/5\ of such 50 percent,
       ``(iii) a manufactured home which meets the requirements of 
     clause (i) and which conforms to Federal Manufactured Home 
     Construction and Safety Standards (section 3280 of title 24, 
     Code of Federal Regulations), or
       ``(iv) a manufactured home which meets the requirements of 
     clause (ii) and which conforms to Federal Manufactured Home 
     Construction and Safety Standards (section 3280 of title 24, 
     Code of Federal Regulations).
       ``(4) Construction.--The term `construction' includes 
     substantial reconstruction and rehabilitation.
       ``(5) Acquire.--The term `acquire' includes purchase and, 
     in the case of reconstruction and rehabilitation, such term 
     includes a binding written contract for such reconstruction 
     or rehabilitation.
       ``(6) Building envelope component.--The term `building 
     envelope component' means--
       ``(A) any sealant, 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--
       ``(i) are specifically and primarily designed to reduce the 
     heat gain of such dwelling unit, and
       ``(ii) meet the Energy Star program requirements.
       ``(d) Certification.--
       ``(1) Method of certification.--A certification described 
     in subsection (c)(3)(C) shall be determined 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.--A certification described in subsection 
     (c)(3)(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 determined under this section for any expenditure 
     with respect

[[Page 7284]]

     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 
     determined.
       ``(f) Special Rule With Respect to Buildings With Energy 
     Efficient Property.--In any case in which a deduction under 
     section 200 or a credit under section 25C has been allowed 
     with respect to property in connection with a dwelling unit, 
     the level of annual heating and cooling energy consumption of 
     the comparable dwelling unit referred to in clauses (i) and 
     (ii) of subsection (c)(3)(C) shall be determined assuming 
     such comparable dwelling unit contains the property for which 
     such deduction or credit has been allowed.
       ``(g) Application of Section.--
       ``(1) 50 percent homes.--In the case of any dwelling unit 
     described in clause (ii) or (iv) of subsection (c)(3)(C), 
     subsection (a) shall apply to qualified new energy efficient 
     homes acquired during the period beginning on the date of the 
     enactment of this section, and ending on December 31, 2009.
       ``(2) 30 percent homes.--In the case of any dwelling unit 
     described in clause (i) or (iii) of subsection (c)(3)(C), 
     subsection (a) shall apply to qualified new energy efficient 
     homes acquired during the period beginning on the date of the 
     enactment of this section, and ending on December 31, 
     2007.''.
       (b) Credit Made Part of General Business Credit.--Section 
     38(b) (relating to current year business credit) is amended 
     by striking ``plus'' at the end of paragraph (19), by 
     striking the period at the end of paragraph (18) and 
     inserting ``, plus'', and by adding at the end the following 
     new paragraph:
       ``(21) the new energy efficient home credit determined 
     under section 45K(a).''.
       (c) Basis Adjustment.--Subsection (a) of section 1016 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 45K(e), in the 
     case of amounts with respect to which a credit has been 
     allowed under section 45K.''.
       (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 45K(a).''.
       (e) 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 new item:

``Sec. 45K. New energy efficient home credit.''.

       (f) Effective Date.--The amendments made by this section 
     shall apply to taxable years ending after the date of the 
     enactment of this Act.

     SEC. 1319. ENERGY EFFICIENT COMMERCIAL BUILDINGS DEDUCTION.

       (a) In General.--Part VI of subchapter B of chapter 1 
     (relating to itemized deductions for individuals and 
     corporations) is amended by inserting after section 179B the 
     following new section:

     ``SEC. 179C. 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 the taxable 
     year and all prior taxable years shall not exceed an amount 
     equal to the product of--
       ``(1) $2.25, and
       ``(2) the square footage of the building.
       ``(c) Definitions.--For purposes of this section--
       ``(1) Energy efficient commercial building property.--The 
     term `energy efficient commercial building property' means 
     property--
       ``(A) which is installed on or in any building located in 
     the United States,
       ``(B) 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
       ``(C) 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).

     A building described in subparagraph (A) may include any 
     residential rental property, including any low-rise 
     multifamily structure or single family housing property which 
     is not within the scope of Standard 90.1-2001, but shall not 
     include any qualified new energy efficient home (within the 
     meaning of section 45K(d)(3)) for which a credit under 
     section 45K has been allowed.
       ``(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)(C) is not met, 
     but
       ``(ii) there is a certification in accordance with 
     paragraph (6) that any system referred to in subsection 
     (c)(1)(B) satisfies the energy-savings targets established by 
     the Secretary under subparagraph (B) with respect to such 
     system,

     then the requirement of subsection (c)(1)(C) 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 `$.75' for `$2.25'.
       ``(B) Regulations.--The Secretary, after consultation with 
     the Secretary of Energy, shall establish a target for each 
     system described in subsection (c)(1)(B) which, if such 
     targets were met for all such systems, the building would 
     meet the requirements of subsection (c)(1)(C).
       ``(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 or, in the 
     case of residential property, the 2005 California Residential 
     Alternative Calculation Method Approval Manual. These 
     regulations shall meet the following requirements:
       ``(A) In calculating tradeoffs and energy performance, the 
     regulations shall prescribe the costs per unit of energy and 
     power, such as kilowatt hour, kilowatt, gallon of fuel oil, 
     and cubic foot or Btu of natural gas, which may be dependent 
     on time of usage. If a State has developed annual energy 
     usage and cost calculation procedures based on time of usage 
     costs for use in the performance standards of the State's 
     building energy code before the effective date of this 
     section, the State may use those annual energy usage and cost 
     calculation procedures in lieu of those adopted by the 
     Secretary.
       ``(B) The calculation methods under this paragraph need not 
     comply fully with section 11 of Standard 90.1-2001.
       ``(C) The calculation methods shall be fuel neutral, such 
     that the same energy efficiency features shall qualify a 
     building for the deduction under this section regardless of 
     whether the heating source is a gas or oil furnace or an 
     electric heat pump. The reference building for a proposed 
     design which employs electric resistance heating shall be 
     modeled as using a heat pump.
       ``(D) The calculation methods shall provide appropriate 
     calculated energy savings for design methods and technologies 
     not otherwise credited in either Standard 90.1-2001 or in the 
     2005 California Nonresidential Alternative Calculation Method 
     Approval Manual, including the following:
       ``(i) Natural ventilation.
       ``(ii) Evaporative cooling.
       ``(iii) Automatic lighting controls such as occupancy 
     sensors, photocells, and timeclocks.
       ``(iv) Daylighting.
       ``(v) Designs utilizing semi-conditioned spaces which 
     maintain adequate comfort conditions without air conditioning 
     or without heating.
       ``(vi) Improved fan system efficiency, including reductions 
     in static pressure.
       ``(vii) Advanced unloading mechanisms for mechanical 
     cooling, such as multiple or variable speed compressors.
       ``(viii) The calculation methods may take into account the 
     extent of commissioning in the building, and allow the 
     taxpayer to take into account measured performance which 
     exceeds typical performance.
       ``(ix) On-site generation of electricity, including 
     combined heat and power systems, fuel cells, and renewable 
     energy generation such as solar energy.
       ``(x) Wiring with lower energy losses than wiring 
     satisfying Standard 90.1-2001 requirements for building power 
     distribution systems.
       ``(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

[[Page 7285]]

     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 public property, 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 public entity which is 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) Coordination With Other Tax Benefits.--
       ``(1) No double benefit.--No deduction shall be allowed 
     under subsection (a) with respect to any building for which a 
     credit under section 45K has been allowed.
       ``(2) Special rule with respect to buildings with energy 
     efficient property.--In any case in which a deduction under 
     section 200 or a credit under section 25C has been allowed 
     with respect to property in connection with a building, the 
     annual energy and power costs of the reference building 
     referred to in subsection (c)(1)(C) shall be determined 
     assuming such reference building contains the property for 
     which such deduction or credit has been allowed.
       ``(h) 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)(C) or (d)(1)(A) is not fully implemented.
       ``(i) Termination.--This section shall not apply with 
     respect to property placed in service after December 31, 
     2010.''.
       (b) Conforming Amendments.--
       (1) Section 1016(a) 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 179C(e).''.
       (2) Section 1245(a) is amended by inserting ``179C,'' after 
     ``179B,'' 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 
     179C''.
       (4) 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.''.
       (5) Section 312(k)(3)(B) is amended by striking ``section 
     179, 179A, or 179B'' each place it appears in the heading and 
     text and inserting ``section 179, 179A, 179B, or 179C''.
       (c) Clerical Amendment.--The table of sections for part VI 
     of subchapter B of chapter 1 is amended by inserting after 
     section 179B the following new item:

``Sec. 179C. Energy efficient commercial buildings deduction.''.

       (d) Effective Date.--The amendments made by this section 
     shall apply to property placed in service after the date of 
     the enactment of this Act in taxable years ending after such 
     date.

     SEC. 1320. ENERGY CREDIT FOR COMBINED HEAT AND POWER SYSTEM 
                   PROPERTY.

       (a) In General.--Section 48(a)(3)(A) (defining energy 
     property), as amended by this title, is amended by striking 
     ``or'' at the end of clause (ii), by inserting ``or'' at the 
     end of clause (iii), and by adding at the end the following:
       ``(iv) combined heat and power system property,''.
       (b) Combined Heat and Power System Property.--Section 48 
     (relating to energy credit), as amended by this title, is 
     amended by adding at the end the following new subsection:
       ``(c) Combined Heat and Power System Property.--For 
     purposes of subsection (a)(3)(A)(iv)--
       ``(1) Combined heat and power system property.--The term 
     `combined heat and power system property' means property 
     comprising a system--
       ``(A) which uses the same energy source for the 
     simultaneous or sequential generation of electrical power, 
     mechanical shaft power, or both, in combination with the 
     generation of steam or other forms of useful thermal energy 
     (including heating and cooling applications),
       ``(B) which has an electrical capacity of not more than 15 
     megawatts or a mechanical energy capacity of not more than 
     2,000 horsepower or an equivalent combination of electrical 
     and mechanical energy capacities,
       ``(C) which produces--
       ``(i) at least 20 percent of its total useful energy in the 
     form of thermal energy which is not used to produce 
     electrical or mechanical power (or combination thereof), and
       ``(ii) at least 20 percent of its total useful energy in 
     the form of electrical or mechanical power (or combination 
     thereof),
       ``(D) the energy efficiency percentage of which exceeds 60 
     percent, and
       ``(E) which is placed in service before January 1, 2009.
       ``(2) Special rules.--
       ``(A) Energy efficiency percentage.--For purposes of this 
     subsection, the energy efficiency percentage of a system is 
     the fraction--
       ``(i) the numerator of which is the total useful 
     electrical, thermal, and mechanical power produced by the 
     system at normal operating rates, and expected to be consumed 
     in its normal application, and
       ``(ii) the denominator of which is the lower heating value 
     of the fuel sources for the system.
       ``(B) Determinations made on btu basis.--The energy 
     efficiency percentage and the percentages under paragraph 
     (1)(C) shall be determined on a Btu basis.
       ``(C) Input and output property not included.--The term 
     `combined heat and power system property' does not include 
     property used to transport the energy source to the facility 
     or to distribute energy produced by the facility.
       ``(D) Public utility property.--
       ``(i) Accounting rule for public utility property.--If the 
     combined heat and power system property is public utility 
     property (as defined in section 168(i)(10)), the taxpayer may 
     only claim the credit under subsection (a) if, with respect 
     to such property, the taxpayer uses a normalization method of 
     accounting.
       ``(ii) Certain exception not to apply.--The matter in 
     subsection (a)(3) which follows subparagraph (D) thereof 
     shall not apply to combined heat and power system property.
       ``(E) Nonapplication of certain rules.--For purposes of 
     determining if the term `combined heat and power system 
     property' includes technologies which generate electricity or 
     mechanical power using back-pressure steam turbines in place 
     of existing pressure-reducing valves or which make use of 
     waste heat from industrial processes such as by using organic 
     rankine, stirling, or kalina heat engine systems, paragraph 
     (1) shall be

[[Page 7286]]

     applied without regard to subparagraphs (A), (C), and (D) 
     thereof.
       ``(3) Systems using bagasse.--If a system is designed to 
     use bagasse for at least 90 percent of the energy source--
       ``(A) paragraph (1)(D) shall not apply, but
       ``(B) the amount of credit determined under subsection (a) 
     with respect to such system shall not exceed the amount which 
     bears the same ratio to such amount of credit (determined 
     without regard to this paragraph) as the energy efficiency 
     percentage of such system bears to 60 percent.
       (c) Effective Date.--The amendments made by this subsection 
     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. 1320A. EXTENSION THROUGH 2010 FOR PLACING QUALIFIED 
                   FACILITIES IN SERVICE FOR PRODUCING RENEWABLE 
                   ELECTRIC ENERGY.

       (a) In General.--Subsection (d) of section 45 is amended by 
     striking ``January 1, 2006'' each place it appears and 
     inserting ``January 1, 2011''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to property originally placed in service on or 
     after January 1, 2006.
       At the end of title XIII, insert after subtitle C the 
     following new subtitle:

  Subtitle D--Method of Accounting for Oil, Gas, and Primary Products 
                                Thereof

     SEC. 1331. PROHIBITION ON USING LAST IN, FIRST-OUT ACCOUNTING 
                   FOR OIL, GAS, AND PRIMARY PRODUCTS THEREOF.

       (a) In General.--Section 472 (relating to last-in, first-
     out inventories) is amended by adding at the end the 
     following new subsection:
       ``(h) Oil and Gas.--Notwithstanding any other provision of 
     this section--
       ``(1) oil, gas, and any primary product of oil or gas, 
     shall be inventoried separately, and
       ``(2) a taxpayer may not use the method provided in 
     subsection (b) in inventorying oil, gas, and any primary 
     product of oil or gas.''.
       (b) Effective Date and Special Rule.--
       (1) In general.--The amendment made by subsection (a) shall 
     apply to taxable years beginning after the date of the 
     enactment of this Act.
       (2) Change in method of accounting.--In the case of any 
     taxpayer required by the amendment made by this section to 
     change its method of accounting for its first taxable year 
     beginning after the date of the enactment of this Act--
       (A) such change shall be treated as initiated by the 
     taxpayer,
       (B) such change shall be treated as made with the consent 
     of the Secretary of the Treasury, and
       (C) the net amount of the adjustments required to be taken 
     into account by the taxpayer under section 481 of the 
     Internal Revenue Code of 1986 shall be taken into account 
     ratably over a period (not greater than 10 taxable years) 
     beginning with such first taxable year.

     SEC. 1332. EMERGING TECHNOLOGIES TRUST FUND.

       (a) In General.--Subchapter A of chapter 98 (relating to 
     trust fund code) is amended by adding at the end the 
     following new section:

     ``SEC. 9511. EMERGING TECHNOLOGIES TRUST FUND.

       ``(a) Creation of Trust Fund.--There is established in the 
     Treasury of the United States a trust fund to be known as the 
     `Emerging Technologies Trust Fund', consisting of such 
     amounts as may be appropriated or credited to such Trust Fund 
     as provided in this section or section 9602(b).
       ``(b) Transfers to Trust Fund.--
       ``(1) In general.--There are hereby appropriated to the 
     Emerging Technologies Trust Fund amounts equivalent to the 
     taxes received in the Treasury by reason of section 472(h) 
     (relating to prohibition on use of last-in, first-out 
     inventory accounting for oil and gas).
       ``(2) Limitation.--The amount appropriated to the Trust 
     Fund under paragraph (1) for any fiscal year shall not exceed 
     $5,000,000,000.
       ``(c) Expenditures.--Amounts in the Emerging Technologies 
     Trust Fund shall be available to the Secretary of Energy to 
     carry out a program to research and develop emerging 
     technologies for more efficient and renewable energy 
     sources.''.
       (b) Clerical Amendment.--The table of sections for such 
     subchapter is amended by adding at the end thereof the 
     following new item:

``Sec. 9511. Emerging Technologies Trust Fund.''.

       In title XIV, add at the end the following new sections:

     SEC. 1452. SMALL BUSINESS COMMERCIALIZATION ASSISTANCE.

       (a) Authority.--The Secretary of Energy shall provide 
     assistance, to small businesses with less than 100 employees 
     and startup companies, for the commercial application of 
     renewable energy and energy efficiency technologies developed 
     by or with support from the Department of Energy. Such 
     assistance shall be provided through a competitive review 
     process.
       (b) Applications.--The Secretary of Energy shall establish 
     requirements for applications for assistance under this 
     section. Such applications shall contain a commercial 
     application plan, including a description of the financial, 
     business, and technical support (including support from 
     universities and national laboratories) the applicant 
     anticipates in its commercial application effort.
       (c) Selection.--The Secretary of Energy shall select 
     applicants to receive assistance under this section on the 
     basis of which applications are the most likely to result in 
     commercial application of renewable energy and energy 
     efficiency technologies.
       (d) Limit on Federal Funding.--The Secretary of Energy 
     shall provide under this section no more than 50 percent of 
     the costs of the project funded.
       (e) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary of Energy for carrying 
     out this section $200,000,000 for each of the fiscal years 
     2006 through 2010, and such sums as may be necessary for each 
     of the fiscal years 2011 through 2026.

     SEC. 1453. SENSE OF THE CONGRESS.

       It is the sense of the Congress that the President should 
     direct the Federal Trade Commission and Attorney General to 
     exercise vigorous oversight over the oil markets to protect 
     the American people from price gouging and unfair practices 
     at the gasoline pump.

     SEC. 1454. TRANSPARENCY.

       The Federal Trade Commission, in consultation with the 
     Secretary of Energy, shall issue regulations requiring full 
     disclosure by refiners and distributors of their wholesale 
     motor fuel pricing policies, with a separate listing of each 
     component contributing to prices, including the cost of crude 
     oil (with exploration, extraction, and transportation costs 
     shown separately if the refiner or distributor is also the 
     producer of the crude oil), refining, marketing, 
     transportation, equipment, overhead, and profit, along with 
     ption of any rebates, incentives, and market enhancement 
     allowances.
       In title XVI, add at the end the following new section:

     SEC. 1614. STUDY OF FINANCING FOR PROTOTYPE TECHNOLOGIES.

       (a) Independent Assessment.--The Secretary of Energy shall 
     commission an independent assessment of innovative financing 
     techniques to facilitate construction of new renewable energy 
     and energy efficiency facilities that might not otherwise be 
     built in a competitive market.
       (b) Conduct of the Assessment.--The Secretary of Energy 
     shall retain an independent contractor with proven expertise 
     in financing large capital projects or in financial services 
     consulting to conduct the assessment under this section.
       (c) Content of the Assessment.--The assessment shall 
     include a comprehensive examination of all available 
     techniques to safeguard private investors against risks 
     (including both market-based and government-imposed risks) 
     that are beyond the control of the investors. Such techniques 
     may include Federal loan guarantees, Federal price 
     guarantees, special tax considerations, and direct Federal 
     investment.
       (d) Report.--The Secretary of Energy shall submit the 
     results of the independent assessment to the Congress not 
     later than 9 months after the date of enactment of this 
     section.

  The Acting CHAIRMAN. Pursuant to House Resolution 219, the gentleman 
from New York (Mr. Bishop) and a Member opposed each will control 15 
minutes.
  The Chair recognizes the gentleman from New York (Mr. Bishop).
  Mr. BISHOP of New York. Mr. Chairman, I yield 3 minutes to the 
gentleman from Massachusetts (Mr. Markey), the cosponsor of this 
amendment.
  Mr. MARKEY. Mr. Chairman, I thank the gentleman from New York (Mr. 
Bishop) for yielding me this time. I thank the gentleman from New York 
for his leadership on this issue, and I am proud to follow his 
leadership on this amendment.
  Last Thursday, President Bush addressed the American Society of 
Newspaper Editors. Here is what he said: ``I will tell you, with $55 a 
barrel oil, we do not need incentives to oil and gas companies to 
explore. There are plenty of incentives. What we need is to put a 
strategy in place that will help this country over time become less 
dependent. It is really important,'' said the President. ``It is an 
important part of our economic security and it is an important part of 
our national security.''
  Those were the President's words last week. But the President then 
went on to call upon Congress to pass the Republican energy bill, a 
bill replete with a rich assortment of tax and deregulatory incentives 
for the oil and gas companies to explore, even though they are

[[Page 7287]]

essentially already drowning in windfall profits. The price of oil has 
doubled essentially from $25 a barrel to more than $50 a barrel. That 
is all extra cash in the oil companies' pockets.
  So the President, I think, has to rely upon his own Energy 
Department, because his own Energy Department has acknowledged that 
this bill that we are debating would result in only negligible changes 
to overall demand, production, and imports, a bill that the Energy 
Department acknowledges will actually increase gasoline prices at the 
pump between 3.5 and 8 cents a gallon. The bill will increase the price 
of gasoline.

                              {time}  1915

  So even though the President says the oil companies do not need 
incentives to drill when prices are so high, in this bill we are 
providing more than $3 billion in tax incentives to Big Oil. This is 
just at the point at which all of their profits are doubling. We are 
giving them tax breaks. It is absolutely unbelievable.
  So what the gentleman from New York (Mr. Bishop) has done is put out 
a series of provisions. If Members do not want to support increasing 
fuel economy standards for SUVs and automobiles so we can take on OPEC, 
what we have is another series of alternatives that can be engaged in 
which are much less Draconian, but will at least give us some 
improvement in the way this country interrelates with gas, oil, and 
other energy sources.
  If Members feel that the Boehlert-Markey amendment is too radical, 
this is your cup of tea. I thank the gentleman from New York (Mr. 
Bishop) for his help on this amendment.
  Mr. Chairman, I rise in support of the amendment offered by the 
gentleman from New York (Mr. Bishop) and I am pleased to join as a 
cosponsor of this amendment.
  Last Thursday, the President addressed the American Society of 
Newspaper Editors. He said:

       I will tell you with $55 oil we don't need incentives to 
     oil and gas companies to explore. There are plenty of 
     incentives. What we need is to put a strategy in place that 
     will help this country over time become less dependent. It's 
     really important. It's an important part of our economic 
     security, and it's an important part of our national 
     security.

  But the President then went on to call upon Congress to pass the 
Republican energy bill--a bill replete with a rich assortment of tax 
and deregulatory ``incentives'' for the oil and gas companies to 
explore, a bill that the President's own Energy Department has 
acknowledged would result in only ``negligible'' changes to overall 
demand, production and imports, a bill that the Energy Department 
acknowledges will actually increase gasoline prices at the pump by 
between 3.5 and 8 cents a gallon. So, even though the President says 
the oil companies don't need ``incentives'' to drill when prices are so 
high, we are providing more than $3 billion in tax incentives to Big 
Oil. We are giving them ``royalty relief'' so they don't have to pay 
the public a fair price for drilling on public lands.
  That is what H.R. 6 offers up as a solution to high oil and gasoline 
prices. This bill says let's give more tax breaks to oil and gas 
companies that even a President who was a former Texas oil man has said 
are not needed. This bill says let's enact proposals that would 
actullay increase the price that consumers pay to fill up their gas 
tanks.
  That is no solution.
  The amendment being offered by the gentleman from New York and myself 
takes a different approach.
  While I continue to believe that the real solution to the current 
high gas prices is increased efficiency, the House has already debated 
that issue. This amendment says, if you aren't willing to take the step 
of mandating higher fuel efficiency standards, are you at least will to 
take some more modest steps?
  On the issue of gas prices, our amendment says, when oil prices are 
at record highs, let's stop filling the Strategic Petroleum Reserve. 
Let's return to the principle of considering the impact of oil and gas 
prices and the economy when we are making decisions about whether and 
when to fill the Reserve. Are you at least willing to do that?
  At the same time, our amendment expresses the Sense of Congress that 
the Federal Trade Commission and the Justice Department should exercise 
vigorous oversight of our Nation's oil and gas markets to guard against 
price gouging or market manipulation. It expresses the Sense of 
Congress that the President should put pressure on OPEC and non-OPEC 
oil producers to increase oil production to help bring down prices. It 
gives the FTC the power to require full disclosure by refiners and 
distributors of fuel pricing policies, costs, and profits, so consumers 
will be better able to determine whether the oil companies are 
profiteering from the current volatility in oil markets. Are you at 
least willing to do that?
  Our amendment also would extend the renewable energy production tax 
credit for 5 years, so that companies know that there will be 
incentives out there to make the investment in building new solar, 
wind, geothermal and biomass technologies, so we can become less 
dependent on coal and natural gas to generate electricity.
  Our amendment strikes the cap on Energy Savings Performance 
Contracts, an important tool used by the Federal government to reduce 
the amount of energy consumed in Federal buildings across the country.
  Our amendment would put in place three additional appliance 
efficiency standards--commercial packaged air conditioners and heat 
pumps, residential dehumidifiers, and commercial spray valves used in 
restaurants. In addition, under the amendment, efficiency standards for 
residential and commercial furnaces and boilers, which have been 
languishing over at the Energy Department for more than 10 years, would 
be speeded up.
  We would strike the Home Depot ceiling fan language that immediately 
preempts state ceiling fan standards before there's even a Federal 
standard in place.
  We would provide a new 10 percent investment tax credit for high-
efficient combined heat and power systems.
  We would provide a tax deduction for expenses needed to reduce energy 
use of new and existing commercial buildings by 50 percent below model 
commercial codes.
  We would provide a tax credit for new homes that reduce energy costs 
by 20-50 percent, and we'd provide a tax deduction for expenses needed 
to cut energy use at new and existing commercial buildings.
  We would provide for the creation of an Emerging Technology Trust 
Fund to help develop emerging technologies for more efficient and 
renewable energy sources, as well as a Small Business Commercialization 
Program, to provide assistance for small businesses and start-up 
companies trying to introduce alternative energy and efficiency 
technologies into the marketplace.
  Finally, our amendment includes the Dingell Democratic alternative 
amendment on electricity, which would preserve the bill's mandatory 
reliability provisions, but delete its proposed repeal of the Public 
Utility Holding Company Act. The Dingell language would also give FERC 
stronger legal authorities to police electricity and natural gas 
markets for fraud.
  The Bishop-Markey Democratic enbloc amendments make some modest but 
useful steps toward making this energy bill a more a balanced bill and 
a more consumer friendly bill. I urge my colleagues to vote for the 
amendment.
  Mr. BARTON of Texas. Mr. Chairman, I claim the time in opposition.
  The Acting Chairman (Mr. Simpson). The Chair recognizes the gentleman 
from Texas (Mr. Barton) for 15 minutes.
  Mr. BARTON of Texas. Mr. Chairman, I yield myself such time as I may 
consume.
  On the Johnson amendment immediately prior, I was in mild opposition. 
On this amendment, I want to be recorded in strong opposition.
  Here is the amendment. It is 124 pages. It may be great. I do not 
believe it is, but I have to stipulate it is possible. There has been 
no hearing on this, no markup on this. Most of the amendments before 
the body today, there may be a paragraph, a page, most of them are 
amendments that were at least debated in one of the committees of 
jurisdiction. This is a 124-page amendment which, I guess, Members 
could say is a substitute for the entire bill. There are 50 pages of 
efficient standards in this amendment.
  Then there is the Dingell electricity substitute, which we have 
already had a debate on earlier today, and then at the end there are 
another 30 pages of tax credits. To top it off, we have some sort of a 
scheme to fix the price of oil.
  What is not in this amendment is anything that would increase 
production, anything that addresses clean coal technology, I believe, 
or hydrogen research or any of those things. Again, I will stipulate 
this is probably a well-intentioned amendment. It is certainly 
lengthily drafted, but I cannot conceive at this stage of the game 
after all

[[Page 7288]]

of the hearings and the markup and the amendments we have already had 
in this Congress and the debate that went on in the prior Congress, in 
the conference report that this House voted on two times, that the 
House would accept this amendment.
  With all due respect to the authors, I would urge a strong ``no'' 
vote on this on a bipartisan basis because I do not think this 
amendment is right for inclusion or substitution for the underlying 
bill.
  Mr. Chairman, I reserve the balance of my time.
  Mr. BISHOP of New York. Mr. Chairman, I yield myself 3 minutes.
  I am pleased to offer the Bishop-Markey-McDermott en bloc amendment 
this evening along with my colleagues. We have an opportunity within 
our reach to make a real advancement in energy policy, but we are about 
to do the unimaginable: pass an energy bill that will do nothing to 
lower gas prices.
  Let me say that again because I think it is important to our 
constituents who are paying $2.25 or more for a gallon of gas, this 
energy bill will not lower gas prices. In fact, according to the 
Department of Energy, this bill may actually increase future gas 
prices.
  Fortunately, our amendment will help consumers see immediate relief 
at the gas pump. The Bishop-Markey-McDermott amendment calls on the 
President to immediately suspend deliveries to the Strategy Petroleum 
Reserve until oil prices fall below $40 per barrel. When we have done 
this in the past, the price of oil has dropped anywhere from $6 to $11 
per barrel.
  The United States should be the global leader in the development of 
new and innovative technologies. This amendment will encourage the 
growth of an energy-efficiency marketplace that fosters and incubates 
new start-ups. This will not only lead to exciting new advances, it 
will help create good-paying jobs for thousands of Americans.
  Our amendment will create a $5 billion emerging-technology trust 
fund, funding the technologies of the future rather than the further 
counterproductive subsidies to the oil and gas industries provided for 
in the underlying bill.
  The Bishop-Markey-McDermott amendment would also offer grants to 
States that meet new standards for efficiency in new building 
development. Under our amendment, the renewable energy production tax 
credit will be extended for 5 years. We will provide tax credits for 
new homes that reduce energy use, as well as tax credits for new and 
existing commercial buildings to reduce energy use; and we would also 
offer an investment tax credit for the development of higher efficiency 
heating and cooling systems.
  In short, we offer tax cuts and credits that America will embrace and 
at the same time create a cleaner and healthier environment for our 
children. We will allow consumers to make more informed decisions about 
energy-efficient appliances for their homes or businesses by adding 
greater meaning to the Energy Star label by mandating that only the top 
25 percent of products will carry that label. Currently, according to 
the Alliance to Save Energy, approximately two-thirds of products are 
eligible to wear the Energy Star label, rendering the distinction 
almost meaningless.
  Mr. Chairman, let us give Americans in the Northeast and on the West 
Coast something to cheer about. America needs electricity reliability 
and protection from fraud and blackouts. H.R. 6 would repeal the Public 
Utility Holding Company Act. Our act would strike that provision. PUHCA 
is the only line of defense for millions of taxpayers protecting them 
from skyrocketing energy costs and greedy corporations. We should not 
allow utility holding companies to use the profits obtained from their 
regulated business activities squeezed from their captive rate-payers 
and pour it down the sinkholes of unregulated businesses. PUHCA should 
not be repealed; it should be applied appropriately and enforced.
  Mr. Chairman, H.R. 6 is anti-taxpayer, anti-consumer, and anti-
environment. And I will say it again, it does nothing to lower gas 
prices. We can do better. The Bishop-Markey-McDermott en bloc amendment 
offers real incentives for energy efficiency and real relief at the 
pump.
  Mr. Chairman, I reserve the balance of my time.
  Mr. BARTON of Texas. Mr. Chairman, I reserve the balance of my time.
  Mr. BISHOP of New York. Mr. Chairman, I yield 3 minutes to the 
gentleman from Washington (Mr. McDermott).
  Mr. McDERMOTT. Mr. Chairman, the Republican energy bill is a license 
to steal. It sanctions Big Oil's approach to America's energy crisis: 
do nothing except count the monstrous profits. Profits may be up 400 
percent, but this bill allows Big Oil to earn even more money to add to 
their current $55 billion cash on hand. They will earn it at the pump, 
and they will earn it at the Treasury Department.
  An accounting gimmick allows Big Oil to escape paying anything close 
to its fair share of taxes. That is the Republican way. The Democrats 
propose, and I proposed in the Committee on Ways and Means, something 
radically different in our alternative energy bill, actually paying for 
it. Imagine that, a bill we paid for on the floor of this House.
  We want to eliminate the provision called LIFO. It means last in 
first out. You buy a barrel of oil at $20, and you buy a barrel 6 
months later at $50. When you put it out, you use the $50 barrel. You 
cut down the profits. Of course, that is what they do. That is the 
American way of saying to Big Oil: pay now less, and then pay even less 
later.
  Democrats are proposing something else, investing in the 21st century 
energy sources. We provide a tax credit for new homes that reduce 
energy by at least 30 percent. That benefits Americans and encourages a 
paradigm shift in thinking to produce energy by saving it. We will 
establish an emergency technology trust fund. We want to harness the 
power of our best minds to chart a course of energy independence.
  We want to extend the renewable energy tax credit. America needs the 
power of wind. My State is full of wind farms provided by Mother 
Nature, and we can harness it. Democrats see America as strong and free 
of an addiction to Big Oil. We are addicted to oil; and as long as we 
remain addicted to oil, we are not going to get any better in this 
whole area.
  We see in America where people are not faced with choosing gasoline 
over food. At $3 a gallon for gasoline, you are hitting pretty hard on 
the food budget. Tonight is a defining moment. Republicans want 
Americans firmly rooted in the past, relying on fuel sources that make 
us vulnerable to too many foreign countries.
  Democrats envision America firmly and finally looking to the future, 
embracing a path to independence and freedom. Vote for America. Vote 
for the Democratic alternative energy bill that takes this country 
where it belongs, into the 21st century. Vote for the Bishop-Markey-
McDermott amendment.
  Mr. BARTON of Texas. Mr. Chairman, I yield 4 minutes to the gentleman 
from Louisiana (Mr. McCrery), a member of the Committee on Ways and 
Means that has jurisdiction on tax issues.
  Mr. McCRERY. Mr. Chairman, the previous speaker made some good 
points. He talked about the need for our country to discover new 
alternative sources of energy, and I think the gentleman is right. The 
underlying bill under consideration has some incentives for developing 
those new alternative sources of energy. Should we do more? Perhaps. I 
think perhaps when we get the final bill out of conference with the 
Senate, there may be more in the bill. But to rail against the oil and 
gas industry, as the gentleman did, and the provisions in the 
underlying bill that provide tax incentives for exploration and 
development of our oil and gas reserves in this country, to me rings 
empty because the substitute or the amendment that is before us that 
the gentleman spoke in favor of does not strike any of those provisions 
in the underlying bill.

[[Page 7289]]

  All this amendment does is add new tax credits to the underlying 
bill. So all of the rhetoric that we heard about the underlying bill is 
just talk because this amendment does nothing to affect those 
provisions the gentleman was speaking against.
  What this amendment does do is basically double the cost of this 
bill, at least the tax provisions in this bill. We have not had time, 
and the chairman of the Committee on Energy and Commerce spoke about 
the number of pages in this amendment, we have not had time, frankly, 
to analyze it from a budgetary aspect to see if it violates the House 
budget we have already passed. It very well could. But it takes the 
cost of tax provisions in this bill from about $8 billion over 10 years 
to about $17 billion over 10 years.
  Now, the accounting gimmick, as the gentleman from Washington put it, 
is called LIFO, last in first out. This is not an accounting principle 
used just by the oil and gas industry. It is used by every sector of 
our economy. It is in common usage, and there is a reason. The reason 
is if we insisted on industry, of whatever kind, accounting for first 
in first out, it would lead to distortions in the market, and it would 
lead to business decisions based on tax considerations instead of 
market considerations. Last in first out is something commonly used 
throughout industry, not just the oil and gas industry. They cannot 
game it. There are regulations in place to keep them from shifting 
their inventory around to take advantage of the accounting rule. So 
this is not something, some gimmick for the oil and gas industry. It is 
a very sound accounting principle used throughout industry in this 
country.
  So I would urge this House not to listen to the words of the 
gentleman, but look at the action embodied in the amendment. This 
amendment does nothing to the underlying tax provisions in the bill. It 
doubles the cost of the bill, and it would impose upon the oil and gas 
industry, just one industrial sector in this country, a retroactive tax 
increase because under his accounting change, those companies would 
have to go back and recapture what they would have paid in taxes and 
pay them prospectively over the next 10 years.
  I hope we have concluded in this body that retroactive tax increases 
are bad policy. So for that reason alone, I would recommend that we 
reject this amendment.

                              {time}  1930

  Mr. BISHOP of New York. Mr. Chairman, I yield 2 minutes to the 
gentleman from Michigan (Mr. Stupak).
  Mr. STUPAK. Mr. Chairman, I rise today in support of the Markey-
Bishop amendment. This amendment includes a provision that permanently 
bans oil and gas drilling in and under our Great Lakes.
  I offered this language as an amendment before the Committee on Rules 
last night. However, the Committee on Rules Republican majority refused 
to allow my bipartisan amendment to be considered on the floor despite 
strong bipartisan support for it in the House and by the American 
people.
  The Great Lakes are one of our Nation's greatest natural resources 
and are vital to more than 30 million Americans who rely upon them for 
their drinking water. Understanding this, Congress has repeatedly 
banned oil and gas drilling in and under the Great Lakes to protect 
this vital resource. In 2001, the House voted overwhelmingly, 265-157, 
in favor of instituting a ban.
  Last week when the Committee on Energy and Commerce marked up this 
legislation, I offered my amendment. Unfortunately, the gentleman from 
Michigan (Mr. Rogers) undermined my amendment in favor of a watered-
down version. That amendment is included in the bill we find before us 
today.
  The Rogers amendment does nothing to stop drilling in the Great 
Lakes. What the Rogers amendment does is leave drilling practices up to 
the eight Great Lakes States and their legislatures. We could have 
eight different policies on drilling in our lakes. Plus it is Congress 
that regulates commerce amongst the several States, as is found in the 
Constitution in the interstate commerce clause.
  The Great Lakes already face a number of threats, invasive species 
and contamination that leads to beach closures. Given these threats, it 
makes no sense to further endanger the Great Lakes by opening them up 
to oil and gas drilling.
  The bottomlands of the Great Lakes will not provide enough oil or 
natural gas to make even a small dent in the amount of America's energy 
needs that are supplied by imported oil and natural gas. And an oil 
spill on the shoreline can contaminate our groundwater.
  Unfortunately, pollution knows no boundaries. When one or more of the 
Great Lakes States does not have a ban and a blowout or a spill occurs, 
those States, all of the States, may be forced to pay the public health 
and environmental price.
  The message is clear. Even an energy crisis is not enough to justify 
threatening our Great Lakes, the world's largest body of fresh water, 
to extract what industry experts agree will be a small amount of oil 
and gas.
  I ask that my colleagues approve this amendment to enact a permanent 
ban on oil and gas drilling in and on the Great Lakes.
  Mr. BARTON of Texas. Mr. Chairman, I yield myself such time as I may 
consume. I would ask to engage in a dialogue with one of the authors of 
the amendment, if they wish to do so.
  I am not being facetious about this. I want to let the gentleman from 
New York know right up front.
  I have spent the last 10 minutes actually trying to look at the 
amendment to try to get a sense of it. It appears to me that most of it 
is the Dingell electricity substitute. Would the gentleman from New 
York agree with that?
  Mr. BISHOP of New York. Mr. Chairman, will the gentleman yield?
  Mr. BARTON of Texas. I yield to the gentleman from New York.
  Mr. BISHOP of New York. Yes, I would, Mr. Chairman.
  Mr. BARTON of Texas. In the beginning, he has some efficiency 
standards. He goes through and sets some specific standards on specific 
appliances, dishwashers and things like this. But on page 21, there is 
something beginning on line 16 that I just do not understand and I just 
want to see.
  The gentleman from New York may not understand it either, because he 
may not have had much advance work in drafting this.
  The heading is Administration, Penalties, Enforcement and Preemption. 
It says, ``Section 345 of the Energy Policy and Conservation Act, 42 
U.S. Code 6316, is amended by adding at the end the following.'' It 
just goes down and says if a State wants to set up a specific standard, 
that is fine, and that State standard will not be preempted until the 
Federal standards established under this bill take effect on January 1, 
2010. I understand that. He is saying the States can set a standard, 
but once the standards in the bill kick in on January 1, 2010, the 
Federal standard preempts. That is a policy debate; we can argue that 
back and forth.
  The next section, I do not understand, subparagraph 3, line 16:
  ``If the California Energy Commission adopts, not later than March 
31, 2005, a regulation concerning the energy efficiency or energy 
effective after, the standards established under section 342(a)(9) take 
effect on January 1, 2010.''
  What does that mean? While the gentleman is trying to get me an 
answer, this is the kind of thing that if we had this in regular order 
in a markup, there would be counsel at the desk and members of the 
committee of jurisdiction would ask the counsel to explain it; and if 
it is a drafting error, then that could be corrected. If it is not a 
drafting error, then at least the members know. I am assuming that is a 
drafting error, but it may not be.
  Mr. BISHOP of New York. It is, in fact, a drafting error. These 
efficiency standards were taken from the Senate bill from the 108th 
Congress and it is a drafting error. The date needs to be updated.
  Mr. BARTON of Texas. Then right underneath that, we are talking about 
administration, penalties, enforcement and preemption on efficiency 
standard for appliances. After that paragraph I just read, then you go 
back and just

[[Page 7290]]

out of the blue, it says, ``In determining whether to defer such 
acquisition, the Secretary shall use market-based practices when 
deciding to acquire petroleum for the Strategic Petroleum Reserve.''
  Again, I am going to assume that this was a cut-and-paste effort and 
something got left out and that should be in another place. Am I 
correct or incorrect on that?
  Mr. BISHOP of New York. If the gentleman can just give me one second.
  Mr. Chairman, I guess what I would say in response is that I 
understand the questions that the gentleman from Texas is raising and I 
understand, I guess, the consternation that he has with respect to 
receiving such a lengthy amendment with little notice. I would only say 
that the underlying bill is equally complex, equally dense, and that 
there are sections of the underlying bill that were not subjected to 
hearings, as well.
  Mr. BARTON of Texas. I sincerely respect the intent of the authors of 
the amendment. I am just trying to point out that even on a cursory 
examination, there are things that were just kind of hastily put 
together. They have not been vetted.
  The underlying bill has been through countless hearings. The Energy 
and Commerce markup took 3\1/2\ days. The base text is the conference 
report from the last Congress that was extensively reviewed both inside 
and out of the conference. At this stage of the game, to adopt this, 
even as well intentioned as it is, would not put the Congress in the 
best light. So I really would hope that we would vote it down.
  I do want to say one thing about the gentleman from Michigan's 
amendment on Great Lakes drilling. He offered his amendment in 
committee. We had a fair debate on it. It was rejected. I do not 
remember the vote. It was a fairly close vote, but it was rejected.
  Then we took a Rogers of Michigan amendment as a substitute that 
gives the States the right to ban drilling if they wish. It is my 
understanding, and I could be incorrect about this, that Michigan 
wishes to ban drilling in the Great Lakes and Ohio perhaps does not. I 
did not learn whether New York wanted to or did not want to. I think 
that Canada does allow it.
  But the base bill allows a State the right to ban drilling on their 
portion of jurisdiction of the Great Lakes if they so wish.
  Mr. STUPAK. Mr. Chairman, will the gentleman yield?
  Mr. BARTON of Texas. I yield to the gentleman from Michigan.
  Mr. STUPAK. Mr. Chairman, if the chairman would remember, he did 
allow me to offer my amendment in committee, but before we had voted to 
do a permanent ban, it was undermined by the Rogers amendment, which 
basically says the same thing that it says in the body of the 
underlying bill, which encourages States to enact a ban.
  As the gentleman from Texas knows well, because we have several 
States who deal with Lake Michigan and four of the five Great Lakes are 
international borders, a ban, if it is going to come, a permanent ban, 
which we seek, would have to be Federal legislation because of the 
interstate commerce clause from which our committee gets its 
jurisdiction. That is why we were very disappointed in that, 
especially.
  In fact, in 2001, we did have a moratorium on oil and gas drilling in 
the Great Lakes, and it passed 265-157 with strong bipartisan support. 
That is why we are disappointed that the Committee on Rules did not 
make our amendment in order.
  Mr. BARTON of Texas. If I could reclaim my time, the gentleman from 
Michigan is a valued member of the committee and has several amendments 
that were accepted, that are in the bill. I hope he is at least in a 
quandary about maybe voting for the bill at some point in time, 
although he has not yet done so.
  But as he just pointed out on the underlying bill, we do encourage 
States, I think the language is, encourages the States to have such a 
ban, but we do not have the Federal preemptive ban that the gentleman 
from Michigan wanted.
  Mr. Chairman, in summary, I oppose this amendment. I think we have 
pointed out a number of flaws in it. I would hope at the appropriate 
time the body would vote it down.
  Mr. Chairman, I yield back the balance of my time.
  Mr. BISHOP of New York. Mr. Chairman, I yield 2 minutes to the 
gentleman from Ohio (Mr. Kucinich).
  Mr. KUCINICH. I thank the gentleman for yielding me this time.
  Mr. Chairman, I want to concur with the gentleman from Michigan (Mr. 
Stupak) who spoke in favor of a Federal ban on drilling for oil or gas 
in the Great Lakes. I represent Cleveland, Ohio, which is a city proud 
to be part of the Great Lakes community. We in Cleveland understand 
that the Great Lakes contain 20 percent of the Earth's fresh water 
surface and supplies drinking water for over 40 million people.
  This is not a matter that any State can choose to go along with or 
against. This is clearly an area for Federal policy. We need a Federal 
policy which says the people of the United States have a right to clean 
drinking water.
  Water is the oil of the 21st century and we are here acting as though 
it is not the basis of life on our planet.
  The risks of drilling are clear. Because the geologic formations 
under Lake Erie are low producing, the oil and gas industry would 
require over 4,200 wells to access the full resource. In Canada, where 
they permitted drilling, an average of almost one spill per month has 
been documented. Now, the industry wants to use directional drilling to 
create new risks. Geologists have noted that leaks will follow the 
drilling shaft down into the groundwater which flows right into Lake 
Erie.
  This amendment, the Markey-Bishop amendment, is a common-sense way to 
meet our energy needs, conservation, energy and renewables, and it is 
also a common-sense way to protect the great water resource we have.
  Why should we even be contesting this? Why would any State want to 
take the responsibility of drilling in the Great Lakes and thus 
poisoning the well for the rest of America?
  This is Federal policy. We have a right to clean water. Support this 
amendment.
  Mr. BISHOP of New York. Mr. Chairman, I yield 1 minute to the 
gentleman from Wisconsin (Mr. Kind).
  Mr. KIND. Mr. Chairman, I thank my friend from New York for not only 
offering the amendment, but providing a very important point in this 
debate, and that is, unfortunately, the underlying bill is not going to 
work because it lacks one crucial element, and that is vision, the 
vision to see that we need to pivot off the status quo of the current 
energy policy and move to a new energy plan that makes sense for a new 
century.
  The fact of the matter is, and the dirty little secret in this place, 
those involved in energy policy have to admit it, is that no matter how 
many incentives we give to the oil companies, how many royalty relief 
provisions are loaded in this bill, even though the President who comes 
from the oil industry says that it is not necessary, given the high 
price of oil, is that we cannot produce our way out of the energy 
challenge that we are facing in this century.
  We are already in a race against China and India for the limited oil 
supplies that exist throughout the world. This amendment provides the 
vision for us to start pivoting off from our dependence on fossil fuels 
generally, but the importation of oil more specifically, by providing 
incentives for alternative and renewable energy sources, incentives for 
increased energy efficiency and conservation practices and, hopefully, 
the incentive to move to a new energy source for a new century, and 
that is fuel cell development.
  I would encourage my colleagues to adopt this amendment.
  Mr. BISHOP of New York. Mr. Chairman, I yield 1 minute to the 
gentleman from New York (Mr. Engel).
  Mr. ENGEL. Mr. Chairman, I thank the gentleman from New York for 
yielding me this time and I rise in strong support of the Bishop-Markey 
substitute.
  This amendment contains a number of provisions designed to reduce 
dependence on nonrenewable energy

[[Page 7291]]

sources. It is ridiculous that H.R. 6 really offers no relief to the 
soaring prices of gasoline. I think that is what our constituents 
really want to see.
  The administration's own Energy Information Administration analyzed 
last year's H.R. 6 and said, changes to production, consumption, 
imports and prices in it are negligible. It even found that gasoline 
prices under the bill would actually increase more than if a bill was 
not enacted.
  The Bishop-Markey amendment offers clear measures to lower the price 
of gas. We should not be filling the Strategic Petroleum Reserve while 
oil prices are so high. We should urge OPEC to increase oil production. 
We should instruct the FTC to protect the American people from price 
gouging at the gas pump. These are reasonable steps. This is what this 
substitute does. And it will provide reasonable relief from high gas 
prices.

                              {time}  1945

  I cannot support H.R. 6 as it is written today despite my great 
affection for our chairman, who was more than fair when we had the 
markup in the Committee on Energy and Commerce; but this Bishop-Markey 
amendment would provide critical improvements to it.
  Support this amendment today.
  The Acting CHAIRMAN (Mr. Simpson). The question is on the amendment 
offered by the gentleman from New York (Mr. Bishop).
  The question was taken; and the Acting Chairman announced that the 
noes appeared to have it.
  Mr. BISHOP of New York. Mr. Chairman, I demand a recorded vote.
  The Acting CHAIRMAN. Pursuant to clause 6 of rule XVIII, further 
proceedings on the amendment offered by the gentleman from New York 
(Mr. Bishop) will be postponed.
  It is now in order to consider amendment No. 8 printed in House 
Report 109-49.


                Amendment No. 8 Offered by Ms. Slaughter

  Ms. SLAUGHTER. Mr. Chairman, I offer an amendment.
  The Acting CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 8 offered by Ms. Slaughter:
       In title I, subtitle C, add at the end the following new 
     section:

     SEC. 135. INTERMITTENT ESCALATORS.

       Section 543 of the National Energy Conservation Policy Act 
     (42 U.S.C. 8253) is amended by adding at the end the 
     following new subsection:
       ``(e) Intermittent Escalators.--
       ``(1) Requirement.--Except as provided in paragraph (2), 
     any escalator acquired for installation in a Federal building 
     shall be an intermittent escalator.
       ``(2) Exception.--Paragraph (1) shall not apply at a 
     location outside the United States where the Federal agency 
     determines that to acquire an intermittent escalator would 
     require substantially greater cost to the Government over the 
     life of the escalator.
       ``(3) Additional energy conservation measures.--In addition 
     to complying with paragraph (1), Federal agencies shall 
     incorporate other escalator energy conservation measures, as 
     appropriate.
       ``(4) Definition.--For purposes of this subsection, 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.''.

  The Acting CHAIRMAN. Pursuant to House Resolution 219, the 
gentlewoman from New York (Ms. Slaughter) and the gentleman from Texas 
(Mr. Barton) each will control 5 minutes.
  The Chair recognizes the gentlewoman from New York (Ms. Slaughter).
  Ms. SLAUGHTER. Mr. Chairman, I yield myself such time as I may 
consume.
  In 1998 Congress set a goal for 2005 to improve the energy efficiency 
in congressional buildings by 20 percent. And I know that the Architect 
of the Capitol has been working very hard to reach the goal. However, 
we have not. Yet the skyrocketing gasoline prices remind us that we 
must do more for conservation.
  I am disappointed that the underlying legislation gives 94 percent of 
its benefits to the oil and gas industry and only 6 percent to 
conservation and renewable efforts.
  My amendment, I think, is a good start at least on some conservation. 
It would simply require that any new escalator being installed in 
Federal buildings to be an intermittent escalator. These have been in 
use in Europe for 30 or 40 years; and I know that when I first saw one, 
I could hardly believe it. It does not begin until the passenger steps 
on a pad entering into the escalator and stops when the passengers are 
off. We would save about 40 percent of the fuel costs, the electricity 
costs, the energy costs. But in addition to that, what we would save 
simply on the wear and tear, the pure mechanics of the escalator, 
probably would be even higher than the energy savings.
  Mr. Chairman, the traditional escalators are used more than 90 
billion times a year in the United States; and with more than 30,000 of 
them across the country, escalators move more people than airplanes. 
And since almost all of them are out of order a good percentage of the 
time, we know that it is important that we do something to conserve 
that kind of money and the investment we have made in the escalators.
  As I pointed out, the amount of energy consumed is estimated to be 
260 million kilowatts an hour, which we would save a cost to the 
Nation, if all of them were intermittent, of $260 million a year.
  I want to quote an analyst at Lawrence Livermore National Laboratory. 
The intermittent escalators, says Lawrence Livermore, are 40 to 50 
percent more energy efficient than traditional escalators. This was 
borne out by a case study supplied to me from the German Embassy, which 
found 40 percent savings in Germany. Energy can be particularly saved 
when the escalator is used only during rush hours.
  Replacing all of them would save us an awful lot of money, but this 
bill does not replace them all. It simply requires that new escalators 
be of the intermittent variety. And I strongly hope that we will accept 
this amendment this evening as part of this energy bill.
  Mr. Chairman, I reserve the balance of my time.
  Mr. BARTON of Texas. Mr. Chairman, I yield myself such time as I may 
consume.
  Mr. Chairman, I rise to qualify in opposition. And I say ``qualify'' 
because when I looked at the amendment several days ago, it appeared to 
me to be a reasonable amendment. Since the gentlewoman was born in 
Texas, it gave me another reason to say yes. And since she is a member 
of the Committee on Rules and every now and then I will need a vote 
from the minority on the Committee on Rules, there was another reason. 
So we had lots of reasons to say yes, and so we did say yes.
  Then we found out that the gentleman from Alaska (Mr. Young), the 
chairman of Committee on Transportation and Infrastructure, had some 
concerns about it, and the General Services Administration had some 
concerns about it. And the concern is that these intermittent 
escalators sometimes cause a safety problem because they start and stop 
too soon and they apparently break down more frequently than 
continuous-operation escalators.
  So here is my proposal to the gentlewoman: I am willing to accept it 
with the understanding that we are going to work with the General 
Services Administration and the gentleman from Alaska (Chairman Young) 
to see if there is a meeting of the minds between now and conference. 
We will go into the base bill. It will be a House position when we go 
to conference. But if for some reason we cannot satisfy these safety 
concerns, since I am probably going to be the chairman of the 
conference, I would reserve the right to drop it in conference after 
consultation with the gentlewoman if we cannot work out some of these 
concerns. But for tonight we would take it.
  Mr. Chairman, I reserve the balance of my time.
  Ms. SLAUGHTER. Mr. Chairman, I yield myself such time as I may 
consume.
  I thank the gentleman very much for his support. I appreciate that. 
And if it is all right with the chairman, I will

[[Page 7292]]

inundate him with that information between now and then.
  Mr. Chairman, I yield back the balance of my time.
  Mr. BARTON of Texas. Mr. Chairman, I yield myself such time as I may 
consume.
  Mr. Chairman, with that reservation, the majority accepts the 
gentlewoman's amendment and urges a mild ``yes'' vote.
  Mr. Chairman, I yield back the balance of my time.
  The Acting CHAIRMAN. The question is on the amendment offered by the 
gentlewoman from New York (Ms. Slaughter).
  The amendment was agreed to.
  The Acting CHAIRMAN. It is now in order to consider amendment No. 9 
printed in House Report 109-49.
  It is now in order to consider amendment No. 10 printed in House 
Report 109-49.
  Mr. BARTON of Texas. Mr. Chairman, I ask unanimous consent, on the 
Oberstar amendment, even though he is not here, that the gentleman from 
Michigan (Mr. Dingell) be allowed to offer it, and if he will on the 
gentleman from Minnesota's (Mr. Oberstar) behalf, I will accept it.
  The Acting CHAIRMAN. Is there objection to the request of the 
gentleman from Texas?
  There was no objection.


                Amendment No. 10 Offered by Mr. Dingell

  Mr. DINGELL. Mr. Chairman, I offer an amendment.
  The Acting CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment No. 10 offered by Mr. Dingell:
       At the end of subtitle A of title II, add the following 
     (and conform the table of contents accordingly):

     SEC. 209. 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.

  The Acting CHAIRMAN. Pursuant to House Resolution 219, the gentleman 
from Michigan (Mr. Dingell) and a Member opposed each will each control 
5 minutes.
  The Chair recognizes the gentleman from Michigan (Mr. Dingell).
  Mr. DINGELL. Mr. Chairman, I yield myself such time as I may consume.
  Under the unanimous consent request, I assume, then, that I have 
offered it; and I yield to the gentleman from the great State of Texas 
(Mr. Barton).
  Mr. BARTON of Texas. Mr. Chairman, I thank the gentleman for yielding 
to me. And I would simply say that the gentleman from Minnesota (Mr. 
Oberstar), the ranking member on the Committee on Transportation and 
Infrastructure, has offered an amendment that would authorize $20 
million for the administrator of General Services Administration to 
proceed with the Sun Wall design project, and the majority is prepared 
to accept it and work with the gentleman from Michigan (Mr. Dingell) 
and the gentleman from Minnesota (Mr. Oberstar) to maintain it in 
conference with the Senate.
  I urge a ``yes'' vote.
  Mr. DINGELL. Mr. Chairman, reclaiming my time and continuing my 
comments, I rejoice that the gentleman has accepted it. I commend him 
for having done so.
  Mr. OBERSTAR. Mr. Chairman, I rise to express my appreciation to the 
gentleman from Michigan for offering the amendment I had planned to and 
was designated to offer, and to the gentleman from Texas for accepting 
the amendment.
  Mr. Chairman, I rise in support of the Oberstar-Norton amendment. The 
amendment authorizes the Administrator of the General Services 
Administration to install a photovoltaic solar energy system 
(photovoltaics) in accordance with the Sun Wall Design Project on the 
Forrestal Building, the headquarters building of the Department of 
Energy located on Independence Avenue in Washington, D.C.
  The Sun Wall is an engineering and architectural marvel; 24,750 
square feet of power generating panels installed on the building's 
south facing wall. It is also visually exciting, reaching 300 feet wide 
and 130 feet high. In fact, the Sun Wall design was selected as the 
winning design in an national contest sponsored jointly by the 
Department of Energy and the National Renewable Fuels Laboratory. The 
project design was completed 5 years ago, in 2000. The project design 
is ready to go. All that is left to do is provide funding for the 
project so that construction of the Sun Wall can begin.
  With ever rising oil prices and our country's ever-increasing 
dependence on oil, the time has come for the federal government to get 
serious about alternative, renewable fuels. In fact, the time is long 
past overdue. The federal government is the Nation's largest energy 
consumer, a typical office building is estimated to spend one-third of 
its operating expenses on energy costs. Using alternative sources of 
energy will help us reduce these costs.
  Photovoltaics are a proven, reliable source of energy. Simply put, 
photovoltaic systems convert solar energy into electricity. They not 
only reduce the consumption of fossil fuels, but they are highly 
efficient and have no moving parts, so the need for maintenance is 
virtually non-existent. Because they emit no harmful pollutants, they 
are a clean, environmentally-friendly energy source.
   H.R. 6 does include provisions aimed at increasing energy efficiency 
in our public buildings. I am especially pleased to see in the bill 
section 205 (regarding the procurement and installation of 
photovoltaics in federal buildings generally), which I offered, and 
which was accepted, as an amendment during consideration of the energy 
bill last Congress.
  Over 25 Federal buildings throughout the country, from Boston, 
Massachusetts to San Francisco, California, already use photovoltaics 
to great effect. We ought to add the national headquarters of the 
Department of Energy to that list.
  The Sun Wall Project is an opportunity to have the Department of 
Energy Headquarters building in our Nation's capital--the building 
where energy policy is debated and refined--stand as a testament to the 
utility and promise of photovoltaics. In a city of monuments, the Sun 
Wall Project would be a monument to America's commitment to advanced 
technologies, alternative energy and a cleaner environment.
  I urge my colleagues to support the amendment.
  Mr. DINGELL. Mr. Chairman, I yield back the balance of my time.
  The Acting CHAIRMAN. The question is on the amendment offered by the 
gentleman from Michigan (Mr. Dingell).
  The amendment was agreed to.


                    Request to Offer Amendment No. 9

  Mr. WAXMAN. Mr. Chairman, I have an amendment at the desk, and I ask 
unanimous consent to be able to go back to that amendment.
  Mr. BARTON of Texas. Mr. Chairman, I reserve the right to object, and 
I will not object.
  The Acting CHAIRMAN. The gentleman will have to offer his amendment 
in the full House. We cannot go back to the amendment.
  Mr. BARTON of Texas. Mr. Chairman, I reserve the right to object.
  The Acting CHAIRMAN. The Chair is not entertaining the motion because 
we cannot go back to the amendment.


                         Parliamentary Inquiry

  Mr. BARTON of Texas. Mr. Chairman, parliamentary inquiry.
  The Acting CHAIRMAN. The gentleman may inquire.
  Mr. BARTON of Texas. Mr. Chairman, since the gentleman from 
California is a member of the committee of jurisdiction and since he 
offered this in committee and it was made in order by the Committee on 
Rules to be offered, even though he was somewhat tardy in arriving, 
would a unanimous consent request, if made and not objected to, give 
him the right to offer the amendment now?
  The Acting CHAIRMAN. Such a request may only be entertained in the 
full House.

[[Page 7293]]


  Mr. BARTON of Texas. Mr. Chairman, I move that the Committee do now 
rise.
  The motion was agreed to.
  Accordingly, the Committee rose; and the Speaker pro tempore (Mr. 
Flake) having assumed the chair, Mr. Simpson, Acting Chairman of the 
Committee of the Whole House on the State of the Union, reported that 
that Committee, having had under consideration the bill (H.R. 6) to 
ensure jobs for our future with secure, affordable, and reliable 
energy, had come to no resolution thereon.

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