calendar no. 97 th st congress session h. r. 2454 · sec. 133. support of indian renewable energy...

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Calendar No. 97 111TH CONGRESS

1ST SESSION H. R. 2454

IN THE SENATE OF THE UNITED STATES

JULY 6, 2009 Received and read the first time

JULY 7, 2009 Read the second time and placed on the calendar

AN ACT To create clean energy jobs, achieve energy independence,

reduce global warming pollution and transition to a clean energy economy.

Be it enacted by the Senate and House of Representa-1

tives of the United States of America in Congress assembled, 2

SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 3

(a) SHORT TITLE.—This Act may be cited as the 4

‘‘American Clean Energy and Security Act of 2009’’. 5

(b) TABLE OF CONTENTS.—The table of contents for 6

this Act is as follows: 7

Sec. 1. Short title; table of contents. Sec. 2. Definitions. Sec. 3. International participation.

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TITLE I—CLEAN ENERGY

Subtitle A—Combined Efficiency and Renewable Electricity Standard

Sec. 101. Combined efficiency and renewable electricity standard. ‘‘Sec. 610. Combined efficiency and renewable electricity standard.

Sec. 102. Clarifying State authority to adopt renewable energy incentives. Sec. 103. Federal renewable energy purchases.

Subtitle B—Carbon Capture and Sequestration

Sec. 111. National strategy. Sec. 112. Regulations for geologic sequestration sites.

‘‘Sec. 813. Geologic sequestration sites. Sec. 113. Studies and reports. Sec. 114. Carbon capture and sequestration demonstration and early deploy-

ment program. Sec. 115. Commercial deployment of carbon capture and sequestration tech-

nologies. ‘‘Sec. 786. Commercial deployment of carbon capture and sequestration

technologies. Sec. 116. Performance standards for coal-fueled power plants.

‘‘Sec. 812. Performance standards for new coal-fired power plants.

Subtitle C—Clean Transportation

Sec. 121. Electric vehicle infrastructure. Sec. 122. Large-scale vehicle electrification program. Sec. 123. Plug-in electric drive vehicle manufacturing. Sec. 124. Investment in clean vehicles. Sec. 125. Advanced technology vehicle manufacturing incentive loans. Sec. 126. Definition of renewable biomass. Sec. 127. Open fuel standard.

‘‘Sec. 32920. Open fuel standard for transportation. Sec. 128. Diesel emissions reduction. Sec. 129. Loan guarantees for projects to construct renewable fuel pipelines. Sec. 130. Fleet vehicles. Sec. 130A. Report on natural gas vehicle emissions reductions.

Subtitle D—State Energy and Environment Development Accounts

Sec. 131. Establishment of SEED Accounts. Sec. 132. Support of State renewable energy and energy efficiency programs. Sec. 133. Support of Indian renewable energy and energy efficiency programs.

Subtitle E—Smart Grid Advancement

Sec. 141. Definitions. Sec. 142. Assessment of Smart Grid cost effectiveness in products. Sec. 143. Inclusions of Smart Grid capability on appliance ENERGY GUIDE

labels. Sec. 144. Smart Grid peak demand reduction goals. Sec. 145. Reauthorization of energy efficiency public information program to

include Smart Grid information. Sec. 146. Inclusion of Smart Grid features in appliance rebate program.

Subtitle F—Transmission Planning


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Sec. 151. Transmission planning and siting. ‘‘Sec. 216A Transmission planning. ‘‘Sec. 216B. Siting and construction in the Western Interconnection.

Sec. 152. Net metering for Federal agencies. Sec. 153. Support for qualified advanced electric transmission manufacturing

plants, qualified high efficiency transmission property, and qualified advanced electric transmission property.

Subtitle G—Technical Corrections to Energy Laws

Sec. 161. Technical corrections to Energy Independence and Security Act of 2007.

Sec. 162. Technical corrections to Energy Policy Act of 2005.

Subtitle H—Energy and Efficiency Centers and Research

Sec. 171. Energy Innovation Hubs. Sec. 172. Advanced energy research. Sec. 173. Building Assessment Centers. Sec. 174. Centers for Energy and Environmental Knowledge and Outreach. Sec. 175. High efficiency gas turbine research, development, and demonstra-

tion.

Subtitle I—Nuclear and Advanced Technologies

Sec. 181. Revisions to loan guarantee program authority. Sec. 182. Purpose. Sec. 183. Definitions. Sec. 184. Clean energy investment fund. Sec. 185. Energy technology deployment goals. Sec. 186. Clean energy deployment administration. Sec. 187. Direct support. Sec. 188. Indirect support. Sec. 189. Federal credit authority. Sec. 190. General provisions. Sec. 191. Conforming amendments.

Subtitle J—Miscellaneous

Sec. 195. Increased hydroelectric generation at existing Federal facilities. Sec. 196. Clean technology business competition grant program. Sec. 197. National Bioenergy Partnership. Sec. 198. Office of Consumer Advocacy.

‘‘Sec. 319. Office of Consumer Advocacy. Sec. 199. Development corporation for renewable power borrowing authority. Sec. 199A. Study.

TITLE II—ENERGY EFFICIENCY

Subtitle A—Building Energy Efficiency Programs

Sec. 201. Greater energy efficiency in building codes. ‘‘Sec. 304. Greater energy efficiency in building codes.

Sec. 202. Building retrofit program. Sec. 203. Energy efficient manufactured homes. Sec. 204. Building energy performance labeling program. Sec. 205. Tree planting programs. Sec. 206. Energy efficiency for data center buildings.


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Sec. 207. Community building code administration grants. Sec. 208. Solar energy systems building permit requirements for receipt of com-

munity development block grant funds. Sec. 209. Prohibition of restrictions on residential installation of solar energy

system.

Subtitle B—Lighting and Appliance Energy Efficiency Programs

Sec. 211. Lighting efficiency standards. Sec. 212. Other appliance efficiency standards. Sec. 213. Appliance efficiency determinations and procedures.

‘‘Sec. 334. Jurisdiction and venue. Sec. 214. Best-in-Class Appliances Deployment Program. Sec. 215. WaterSense. Sec. 216. Federal procurement of water efficient products. Sec. 217. Early adopter water efficient product incentive programs. Sec. 218. Certified stoves program. Sec. 219. Energy Star standards.

Subtitle C—Transportation Efficiency

Sec. 221. Emissions standards.

‘‘PART B—MOBILE SOURCES

‘‘Sec. 821. Greenhouse gas emission standards for mobile sources. Sec. 222. Greenhouse gas emissions reductions through transportation effi-

ciency.

‘‘PART D—TRANSPORTATION EMISSIONS

‘‘Sec. 841. Greenhouse gas emissions reductions through transportation ef-ficiency.

Sec. 223. SmartWay transportation efficiency program. ‘‘Sec. 822. SmartWay transportation efficiency program.

Sec. 224. State vehicle fleets.

Subtitle D—Industrial Energy Efficiency Programs

Sec. 241. Industrial plant energy efficiency standards. Sec. 242. Electric and thermal waste energy recovery award program. Sec. 243. Clarifying election of waste heat recovery financial incentives. Sec. 244. Motor market assessment and commercial awareness program. Sec. 245. Motor efficiency rebate program.

‘‘Sec. 347. Motor efficiency rebate program. Sec. 246. Clean energy manufacturing revolving loan fund program.

‘‘Sec. 27. Clean energy manufacturing revolving loan fund program. Sec. 247. Clean energy and efficiency manufacturing partnerships. Sec. 248. Technical amendments.

Subtitle E—Improvements in Energy Savings Performance Contracting

Sec. 251. Energy savings performance contracts.

Subtitle F—Public Institutions

Sec. 261. Public institutions. Sec. 262. Community energy efficiency flexibility.


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Sec. 263. Small community joint participation. Sec. 264. Low income community energy efficiency program. Sec. 265. Consumer behavior research.

Subtitle G—Miscellaneous

Sec. 271. Energy efficient information and communications technologies. ‘‘Sec. 543. Energy efficient information and communications technologies.

Sec. 272. National energy efficiency goals. Sec. 273. Affiliated island energy independence team. Sec. 274. Product carbon disclosure program. Sec. 275. Industrial energy efficiency education and training initiative. Sec. 276. Sense of Congress.

Subtitle H—Green Resources for Energy Efficient Neighborhoods

Sec. 281. Short title. Sec. 282. Definitions. Sec. 283. Implementation of energy efficiency participation incentives for HUD

programs. Sec. 284. Basic HUD energy efficiency standards and standards for additional

credit. Sec. 285. Energy efficiency and conservation demonstration program for multi-

family housing projects assisted with project-based rental as-sistance.

Sec. 286. Additional credit for Fannie Mae and Freddie Mac housing goals for energy-efficient and location-efficient mortgages.

Sec. 287. Duty to serve underserved markets for energy-efficient and location- efficient mortgages.

Sec. 288. Consideration of energy efficiency under FHA mortgage insurance programs and Native American and Native Hawaiian loan guarantee programs.

‘‘Sec. 543. Consideration of energy efficiency. Sec. 289. Energy-efficient mortgages and location-efficient mortgages education

and outreach campaign. Sec. 290. Collection of information on energy-efficient and location-efficient

mortgages through Home Mortgage Disclosure Act. Sec. 291. Ensuring availability of homeowners insurance for homes not con-

nected to electricity grid. Sec. 292. Mortgage incentives for energy-efficient multifamily housing. Sec. 293. Energy-efficient certifications for manufactured housing with mort-

gages. Sec. 294. Assisted housing energy loan pilot program. Sec. 295. Making it green. Sec. 296. Residential energy efficiency block grant program.

‘‘Sec. 123. Residential energy efficiency block grant program. Sec. 297. Including sustainable development and transportation strategies in

comprehensive housing affordability strategies. Sec. 298. Grant program to increase sustainable low-income community devel-

opment capacity. Sec. 299. HOPE VI green developments requirement. Sec. 299A. Consideration of energy efficiency improvements in appraisals. Sec. 299B. Housing Assistance Council. Sec. 299C. Rural housing and economic development assistance. Sec. 299D. Loans to States and Indian tribes to carry out renewable energy

sources activities.


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Sec. 299E. Green banking centers. Sec. 299F. GAO reports on availability of affordable mortgages. Sec. 299G. Public housing energy cost report. Sec. 299H. Secondary market for residential renewable energy lease instru-

ments. Sec. 299I. Green guarantees.

TITLE III—REDUCING GLOBAL WARMING POLLUTION

Sec. 301. Short title.

Subtitle A—Reducing Global Warming Pollution

Sec. 311. Reducing global warming pollution.

‘‘TITLE VII—GLOBAL WARMING POLLUTION REDUCTION PROGRAM

‘‘PART A—GLOBAL WARMING POLLUTION REDUCTION GOALS AND TARGETS

‘‘Sec. 701. Findings and purpose. ‘‘Sec. 702. Economy-wide reduction goals. ‘‘Sec. 703. Reduction targets for specified sources. ‘‘Sec. 704. Supplemental pollution reductions. ‘‘Sec. 705. Review and program recommendations. ‘‘Sec. 706. National Academy review. ‘‘Sec. 707. Presidential response and recommendations.

‘‘PART B—DESIGNATION AND REGISTRATION OF GREENHOUSE GASES

‘‘Sec. 711. Designation of greenhouse gases. ‘‘Sec. 712. Carbon dioxide equivalent value of greenhouse gases. ‘‘Sec. 713. Greenhouse gas registry.

‘‘PART C—PROGRAM RULES

‘‘Sec. 721. Emission allowances. ‘‘Sec. 722. Prohibition of excess emissions. ‘‘Sec. 723. Penalty for noncompliance. ‘‘Sec. 724. Trading. ‘‘Sec. 725. Banking and borrowing. ‘‘Sec. 726. Strategic reserve. ‘‘Sec. 727. Permits. ‘‘Sec. 728. International emission allowances.

‘‘PART D—OFFSETS

‘‘Sec. 731. Offsets Integrity Advisory Board. ‘‘Sec. 732. Establishment of offsets program. ‘‘Sec. 733. Eligible project types. ‘‘Sec. 734. Requirements for offset projects. ‘‘Sec. 735. Approval of offset projects. ‘‘Sec. 736. Verification of offset projects. ‘‘Sec. 737. Issuance of offset credits. ‘‘Sec. 738. Audits. ‘‘Sec. 739. Program review and revision. ‘‘Sec. 740. Early offset supply. ‘‘Sec. 741. Environmental considerations.


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‘‘Sec. 742. Trading. ‘‘Sec. 743. International offset credits.

‘‘PART E—SUPPLEMENTAL EMISSIONS REDUCTIONS FROM REDUCED DEFORESTATION

‘‘Sec. 751. Definitions. ‘‘Sec. 752. Findings. ‘‘Sec. 753. Supplemental emissions reductions through reduced deforest-

ation. ‘‘Sec. 754. Requirements for international deforestation reduction pro-

gram. ‘‘Sec. 755. Reports and reviews. ‘‘Sec. 756. Legal effect of part.

Sec. 312. Definitions. ‘‘Sec. 700. Definitions.

Subtitle B—Disposition of Allowances

Sec. 321. Disposition of allowances for global warming pollution reduction pro-gram.

‘‘PART H—DISPOSITION OF ALLOWANCES

‘‘Sec. 781. Allocation of allowances for supplemental reductions. ‘‘Sec. 782. Allocation of emission allowances. ‘‘Sec. 783. Electricity consumers. ‘‘Sec. 784. Natural gas consumers. ‘‘Sec. 785. Home heating oil, propane, and kerosene consumers. ‘‘Sec. 787. Allocations to refineries. ‘‘Sec. 788. Supplemental agriculture and renewable energy incentives pro-

grams. ‘‘Sec. 789. Climate change consumer refunds. ‘‘Sec. 790. Exchange for State-issued allowances. ‘‘Sec. 791. Auction procedures. ‘‘Sec. 792. Auctioning allowances for other entities. ‘‘Sec. 793. Establishment of funds. ‘‘Sec. 794. Oversight of allocations. ‘‘Sec. 795. Exchange for early action offset credits.

Subtitle C—Additional Greenhouse Gas Standards

Sec. 331. Greenhouse gas standards.

‘‘TITLE VIII—ADDITIONAL GREENHOUSE GAS STANDARDS

‘‘Sec. 801. Definitions.

‘‘PART A—STATIONARY SOURCE STANDARDS

‘‘Sec. 811. Standards of performance.

‘‘PART C—EXEMPTIONS FROM OTHER PROGRAMS

‘‘Sec. 831. Criteria pollutants. ‘‘Sec. 832. International air pollution. ‘‘Sec. 833. Hazardous air pollutants. ‘‘Sec. 834. New source review.


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‘‘Sec. 835. Title V permits. Sec. 332. HFC Regulation.

‘‘Sec. 619. Hydrofluorocarbons (HFCs). Sec. 333. Black carbon.

‘‘PART E—BLACK CARBON

‘‘Sec. 851. Black carbon. Sec. 334. States. Sec. 335. State programs.

‘‘PART F—MISCELLANEOUS

‘‘Sec. 861. State programs. ‘‘Sec. 862. Grants for support of air pollution control programs.

Sec. 336. Enforcement. Sec. 337. Conforming amendments. Sec. 338. Davis-Bacon compliance. Sec. 339. National strategy for domestic biological carbon sequestration. Sec. 340. Reducing acid rain and mercury pollution.

Subtitle D—Carbon Market Assurance

Sec. 341. Carbon market assurance.

‘‘PART IV—CARBON MARKET ASSURANCE

‘‘Sec. 401. Oversight and assurance of carbon markets. ‘‘Sec. 402. Applicability of Part III provisions. ‘‘Sec. 1041. Fraud and false statements in connection with regulated al-

lowances. Sec. 342. Carbon derivative markets.

Subtitle E—Additional Market Assurance

Sec. 351. Regulation of certain transactions in derivatives involving energy commodities.

Sec. 352. No effect on authority of the Federal Energy Regulatory Commission. Sec. 353. Inspector General of the Commodity Futures Trading Commission. Sec. 354. Settlement and clearing through registered derivatives clearing orga-

nizations. Sec. 355. Limitation on eligibility to purchase a credit default swap. Sec. 356. Transaction fees. Sec. 357. No effect on antitrust law or authority of the Federal Trade Commis-

sion. Sec. 358. Effect of derivatives regulatory reform legislation. Sec. 359. Cease-and-desist authority. Sec. 360. Presidential review of regulations.

TITLE IV—TRANSITIONING TO A CLEAN ENERGY ECONOMY

Subtitle A—Ensuring Real Reductions in Industrial Emissions

Sec. 401. Ensuring real reductions in industrial emissions.

‘‘PART F—ENSURING REAL REDUCTIONS IN INDUSTRIAL EMISSIONS

‘‘Sec. 761. Purposes. ‘‘Sec. 762. Definitions.


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‘‘SUBPART 1—EMISSION ALLOWANCE REBATE PROGRAM

‘‘Sec. 763. Eligible industrial sectors. ‘‘Sec. 764. Distribution of emission allowance rebates.

‘‘SUBPART 2—PROMOTING INTERNATIONAL REDUCTIONS IN INDUSTRIAL EMISSIONS

‘‘Sec. 765. International negotiations. ‘‘Sec. 766. United States negotiating objectives with respect to multilateral

environmental negotiations. ‘‘Sec. 767. Presidential reports and determinations. ‘‘Sec. 768. International reserve allowance program. ‘‘Sec. 769. Iron and steel sector.

Subtitle B—Green Jobs and Worker Transition

PART 1—GREEN JOBS

Sec. 421. Clean energy curriculum development grants. Sec. 422. Increased funding for energy worker training program. Sec. 423. Development of Information and Resources clearinghouse for voca-

tional education and job training in renewable energy sectors. Sec. 424. Monitoring program effectiveness. Sec. 424A. Green construction careers demonstration project.

PART 2—CLIMATE CHANGE WORKER ADJUSTMENT ASSISTANCE

Sec. 425. Petitions, eligibility requirements, and determinations. Sec. 426. Program benefits. Sec. 427. General provisions.

Subtitle C—Consumer Assistance

Sec. 431. Energy refund program.

‘‘TITLE XXII—ENERGY REFUND PROGRAM

‘‘Sec. 2201. Energy refund program. Sec. 432. Modification of earned income credit amount for individuals with no

qualifying children. Sec. 433. Protection of Social Security and Medicare trust funds.

Subtitle D—Exporting Clean Technology

Sec. 441. Findings and purposes. Sec. 442. Definitions. Sec. 443. Governance. Sec. 444. Determination of eligible countries. Sec. 445. Qualifying activities. Sec. 446. Assistance.

Subtitle E—Adapting to Climate Change

PART 1—DOMESTIC ADAPTATION

SUBPART A—NATIONAL CLIMATE CHANGE ADAPTATION PROGRAM

Sec. 451. Global change research and data management.


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Sec. 452. National Climate Service. Sec. 453. State programs to build resilience to climate change impacts.

SUBPART B—PUBLIC HEALTH AND CLIMATE CHANGE

Sec. 461. Sense of Congress on public health and climate change. Sec. 462. Relationship to other laws. Sec. 463. National strategic action plan. Sec. 464. Advisory board. Sec. 465. Reports. Sec. 466. Definitions. Sec. 467. Climate Change Health Protection and Promotion Fund.

SUBPART C—NATURAL RESOURCE ADAPTATION

Sec. 471. Purposes. Sec. 472. Natural resources climate change adaptation policy. Sec. 473. Definitions. Sec. 474. Council on Environmental Quality. Sec. 475. Natural Resources Climate Change Adaptation Panel. Sec. 476. Natural Resources Climate Change Adaptation Strategy. Sec. 477. Natural resources adaptation science and information. Sec. 478. Federal natural resource agency adaptation plans. Sec. 479. State natural resources adaptation plans. Sec. 480. Natural Resources Climate Change Adaptation Fund. Sec. 481. National Wildlife Habitat and Corridors Information Program. Sec. 482. Additional provisions regarding Indian tribes.

PART 2—INTERNATIONAL CLIMATE CHANGE ADAPTATION PROGRAM

Sec. 491. Findings and purposes. Sec. 492. Definitions. Sec. 493. International Climate Change Adaptation Program. Sec. 494. Distribution of allowances. Sec. 495. Bilateral assistance.

TITLE V—AGRICULTURAL AND FORESTRY RELATED OFFSETS

Subtitle A—Offset Credit Program From Domestic Agricultural and Forestry Sources

Sec. 501. Definitions. Sec. 502. Establishment of offset credit program from domestic agricultural

and forestry sources. Sec. 503. List of eligible domestic agricultural and forestry offset practice

types. Sec. 504. Requirements for domestic agricultural and forestry practices. Sec. 505. Project plan submission and approval. Sec. 506. Verification of offset practices. Sec. 507. Certification of offset credits. Sec. 508. Ownership and transfer of offset credits. Sec. 509. Program review and revision. Sec. 510. Environmental considerations. Sec. 511. Audits.

Subtitle B—USDA Greenhouse Gas Emission Reduction and Sequestration Advisory Committee


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Sec. 531. Establishment of USDA Greenhouse Gas Emission Reduction and Sequestration Advisory Committee.

Subtitle C—Miscellaneous

Sec. 551. International indirect land use changes. Sec. 552. Biomass-based diesel. Sec. 553. Modification of definition of renewable biomass.

SEC. 2. DEFINITIONS. 1

For purposes of this Act: 2

(1) ADMINISTRATOR.—The term ‘‘Adminis-3

trator’’ means the Administrator of the Environ-4

mental Protection Agency. 5

(2) STATE.—The term ‘‘State’’ has the mean-6

ing given that term in section 302 of the Clean Air 7

Act. 8

SEC. 3. INTERNATIONAL PARTICIPATION. 9

The Administrator, in consultation with the Depart-10

ment of State and the United States Trade Representa-11

tive, shall annually prepare and certify a report to the 12

Congress regarding whether China and India have adopted 13

greenhouse gas emissions standards at least as strict as 14

those standards required under this Act. If the Adminis-15

trator determines that China and India have not adopted 16

greenhouse gas emissions standards at least as stringent 17

as those set forth in this Act, the Administrator shall no-18

tify each Member of Congress of his determination, and 19

shall release his determination to the media. 20


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TITLE I—CLEAN ENERGY 1Subtitle A—Combined Efficiency 2

and Renewable Electricity 3Standard 4

SEC. 101. COMBINED EFFICIENCY AND RENEWABLE ELEC-5

TRICITY STANDARD. 6

(a) IN GENERAL.—Title VI of the Public Utility Reg-7

ulatory Policies Act of 1978 (16 U.S.C. 2601 and fol-8

lowing) is amended by adding at the end the following: 9

‘‘SEC. 610. COMBINED EFFICIENCY AND RENEWABLE ELEC-10

TRICITY STANDARD. 11

‘‘(a) DEFINITIONS.—For purposes of this section: 12

‘‘(1) CHP SAVINGS.—The term ‘CHP savings’ 13

means— 14

‘‘(A) CHP system savings from a combined 15

heat and power system that commences oper-16

ation after the date of enactment of this sec-17

tion; and 18

‘‘(B) the increase in CHP system savings 19

from, at any time after the date of the enact-20

ment of this section, upgrading, replacing, ex-21

panding, or increasing the utilization of a com-22

bined heat and power system that commenced 23

operation on or before the date of enactment of 24

this section. 25


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‘‘(2) CHP SYSTEM SAVINGS.—The term ‘CHP 1

system savings’ means the increment of electric out-2

put of a combined heat and power system that is at-3

tributable to the higher efficiency of the combined 4

system (as compared to the efficiency of separate 5

production of the electric and thermal outputs). 6

‘‘(3) COMBINED HEAT AND POWER SYSTEM.— 7

The term ‘combined heat and power system’ means 8

a system that uses the same energy source both for 9

the generation of electrical or mechanical power and 10

the production of steam or another form of useful 11

thermal energy, provided that— 12

‘‘(A) the system meets such requirements 13

relating to efficiency and other operating char-14

acteristics as the Commission may promulgate 15

by regulation; and 16

‘‘(B) the net sales of electricity by the fa-17

cility to customers not consuming the thermal 18

output from that facility will not exceed 50 per-19

cent of total annual electric generation by the 20

facility. 21

‘‘(4) CUSTOMER FACILITY SAVINGS.—The term 22

‘customer facility savings’ means a reduction in end- 23

use electricity consumption (including recycled en-24

ergy savings) at a facility of an end-use consumer of 25


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electricity served by a retail electric supplier, as 1

compared to— 2

‘‘(A) in the case of a new facility, con-3

sumption at a reference facility of average effi-4

ciency; 5

‘‘(B) in the case of an existing facility, 6

consumption at such facility during a base pe-7

riod, except as provided in subparagraphs (C) 8

and (D); 9

‘‘(C) in the case of new equipment that re-10

places existing equipment with remaining useful 11

life, the projected consumption of the existing 12

equipment for the remaining useful life of such 13

equipment, and thereafter, consumption of new 14

equipment of average efficiency of the same 15

equipment type; and 16

‘‘(D) in the case of new equipment that re-17

places existing equipment at the end of the use-18

ful life of the existing equipment, consumption 19

by new equipment of average efficiency of the 20

same equipment type. 21

‘‘(5) DISTRIBUTED RENEWABLE GENERATION 22

FACILITY.—The term ‘distributed renewable genera-23

tion facility’ means a facility that— 24

‘‘(A) generates renewable electricity; 25


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‘‘(B) primarily serves 1 or more electricity 1

consumers at or near the facility site; and 2

‘‘(C) is no greater than— 3

‘‘(i) 2 megawatts in capacity; or 4

‘‘(ii) 4 megawatts in capacity, in the 5

case of a facility that is placed in service 6

after the date of enactment of this section 7

and generates electricity from a renewable 8

energy resource other than by means of 9

combustion. 10

‘‘(6) ELECTRICITY SAVINGS.—The term ‘elec-11

tricity savings’ means reductions in electricity con-12

sumption, relative to business-as-usual projections, 13

achieved through measures implemented after the 14

date of enactment of this section, limited to— 15

‘‘(A) customer facility savings of elec-16

tricity, adjusted to reflect any associated in-17

crease in fuel consumption at the facility; 18

‘‘(B) reductions in distribution system 19

losses of electricity achieved by a retail elec-20

tricity distributor, as compared to losses attrib-21

utable to new or replacement distribution sys-22

tem equipment of average efficiency; 23

‘‘(C) CHP savings; and 24

‘‘(D) fuel cell savings. 25


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‘‘(7) CENTRAL PROCUREMENT STATE.—The 1

term ‘central procurement State’ means a State 2

that, as of January 1, 2009, had adopted and imple-3

mented a legally enforceable mandate that, in lieu of 4

requiring utilities to submit credits or certificates 5

issued based on generation of electricity from (or to 6

purchase or generate electricity from) resources de-7

fined by the State as renewable, requires retail elec-8

tric suppliers to collect payments from electricity 9

ratepayers within the State that are used for central 10

procurement, by a State agency or a public benefit 11

corporation established pursuant to State law, of 12

credits or certificates issued based on generation of 13

electricity from resources defined by the State as re-14

newable. 15

‘‘(8) FEDERAL RENEWABLE ELECTRICITY 16

CREDIT.—The term ‘Federal renewable electricity 17

credit’ means a credit, representing one megawatt 18

hour of renewable electricity, issued pursuant to sub-19

section (e). 20

‘‘(9) FUEL CELL.—The term ‘fuel cell’ means a 21

device that directly converts the chemical energy of 22

a fuel and an oxidant into electricity by electro-23

chemical processes occurring at separate electrodes 24

in the device. 25


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‘‘(10) FUEL CELL SAVINGS.—The term ‘fuel 1

cell savings’ means the electricity saved by a fuel cell 2

that is installed after the date of enactment of this 3

section, or by upgrading a fuel cell that commenced 4

operation on or before the date of enactment of this 5

section, as a result of the greater efficiency with 6

which the fuel cell transforms fuel into electricity as 7

compared with sources of electricity delivered 8

through the grid, provided that— 9

‘‘(A) the fuel cell meets such requirements 10

relating to efficiency and other operating char-11

acteristics as the Commission may promulgate 12

by regulation; and 13

‘‘(B) the net sales of electricity from the 14

fuel cell to customers not consuming the ther-15

mal output from the fuel cell, if any, do not ex-16

ceed 50 percent of the total annual electricity 17

generation by the fuel cell. 18

‘‘(11) OTHER QUALIFYING ENERGY RE-19

SOURCE.—The term ‘other qualifying energy re-20

source’ means any of the following: 21

‘‘(A) Landfill gas. 22

‘‘(B) Wastewater treatment gas. 23

‘‘(C) Coal mine methane used to generate 24

electricity at or near the mine mouth. 25


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‘‘(D) Qualified waste-to-energy. 1

‘‘(12) QUALIFIED HYDROPOWER.—The term 2

‘qualified hydropower’ means— 3

‘‘(A) energy produced from increased effi-4

ciency achieved, or additions of capacity made, 5

on or after January 1, 1988, at a hydroelectric 6

facility that was placed in service before that 7

date and does not include additional energy 8

generated as a result of operational changes not 9

directly associated with efficiency improvements 10

or capacity additions; or 11

‘‘(B) energy produced from generating ca-12

pacity added to a dam on or after January 1, 13

1988, provided that the Commission certifies 14

that— 15

‘‘(i) the dam was placed in service be-16

fore the date of the enactment of this sec-17

tion and was operated for flood control, 18

navigation, or water supply purposes and 19

was not producing hydroelectric power 20

prior to the addition of such capacity; 21

‘‘(ii) the hydroelectric project installed 22

on the dam is licensed (or is exempt from 23

licensing) by the Commission and is in 24

compliance with the terms and conditions 25


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of the license or exemption, and with other 1

applicable legal requirements for the pro-2

tection of environmental quality, including 3

applicable fish passage requirements; and 4

‘‘(iii) the hydroelectric project in-5

stalled on the dam is operated so that the 6

water surface elevation at any given loca-7

tion and time that would have occurred in 8

the absence of the hydroelectric project is 9

maintained, subject to any license or ex-10

emption requirements that require changes 11

in water surface elevation for the purpose 12

of improving the environmental quality of 13

the affected waterway. 14

‘‘(13) QUALIFIED WASTE-TO-ENERGY.—The 15

term ‘qualified waste-to-energy’ means energy from 16

the combustion of municipal solid waste or construc-17

tion, demolition, or disaster debris, or from the gas-18

ification or pyrolization of such waste or debris and 19

the combustion of the resulting gas at the same fa-20

cility, provided that— 21

‘‘(A) such term shall include only the en-22

ergy derived from the non-fossil biogenic por-23

tion of such waste or debris; 24


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‘‘(B) the Commission determines, with the 1

concurrence of the Administrator of the Envi-2

ronmental Protection Agency, that the total 3

lifecycle greenhouse gas emissions attributable 4

to the generation of electricity from such waste 5

or debris are lower than those attributable to 6

the likely alternative method of disposing of 7

such waste or debris; and 8

‘‘(C) the owner or operator of the facility 9

generating electricity from such energy provides 10

to the Commission, on an annual basis— 11

‘‘(i) a certification that the facility is 12

in compliance with all applicable State, 13

tribal, and Federal environmental permits; 14

‘‘(ii) in the case of a facility that com-15

menced operation before the date of enact-16

ment of this section, a certification that 17

the facility meets emissions standards pro-18

mulgated under section 112 or 129 of the 19

Clean Air Act (42 U.S.C. 7412 or 7429) 20

that apply as of the date of enactment of 21

this section to new facilities within the rel-22

evant source category; and 23

‘‘(iii) in the case of the combustion, 24

pyrolization, or gasification of municipal 25


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solid waste, a certification that each local 1

government unit from which such waste 2

originates operates, participates in the op-3

eration of, contracts for, or otherwise pro-4

vides for, recycling services for its resi-5

dents. 6

‘‘(14) RECYCLED ENERGY SAVINGS.—The term 7

‘recycled energy savings’ means a reduction in elec-8

tricity consumption that results from a modification 9

of an industrial or commercial system that com-10

menced operation before the date of enactment of 11

this section, in order to recapture electrical, mechan-12

ical, or thermal energy that would otherwise be 13

wasted. 14

‘‘(15) RENEWABLE BIOMASS.—The term ‘re-15

newable biomass’ means any of the following: 16

‘‘(A) Materials, pre-commercial thinnings, 17

or removed invasive species from National For-18

est System land and public lands (as defined in 19

section 103 of the Federal Land Policy and 20

Management Act of 1976 (43 U.S.C. 1702)), 21

including those that are byproducts of preven-22

tive treatments (such as trees, wood, brush, 23

thinnings, chips, and slash), that are removed 24

as part of a federally recognized timber sale, or 25


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that are removed to reduce hazardous fuels, to 1

reduce or contain disease or insect infestation, 2

or to restore ecosystem health, and that are— 3

‘‘(i) not from components of the Na-4

tional Wilderness Preservation System, 5

Wilderness Study Areas, Inventoried 6

Roadless Areas, old growth stands, late- 7

successional stands (except for dead, se-8

verely damaged, or badly infested trees), 9

components of the National Landscape 10

Conservation System, National Monu-11

ments, National Conservation Areas, Des-12

ignated Primitive Areas, or Wild and Sce-13

nic Rivers corridors; 14

‘‘(ii) harvested in environmentally sus-15

tainable quantities, as determined by the 16

appropriate Federal land manager; and 17

‘‘(iii) harvested in accordance with 18

Federal and State law, and applicable land 19

management plans. 20

‘‘(B) Any organic matter that is available 21

on a renewable or recurring basis from non- 22

Federal land or land belonging to an Indian or 23

Indian tribe that is held in trust by the United 24


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States or subject to a restriction against alien-1

ation imposed by the United States, including— 2

‘‘(i) renewable plant material, includ-3

ing— 4

‘‘(I) feed grains; 5

‘‘(II) other agricultural commod-6

ities; 7

‘‘(III) other plants and trees; and 8

‘‘(IV) algae; and 9

‘‘(ii) waste material, including— 10

‘‘(I) crop residue; 11

‘‘(II) other vegetative waste ma-12

terial (including wood waste and wood 13

residues); 14

‘‘(III) animal waste and byprod-15

ucts (including fats, oils, greases, and 16

manure); 17

‘‘(IV) construction waste; and 18

‘‘(V) food waste and yard waste. 19

‘‘(C) Residues and byproducts from wood, 20

pulp, or paper products facilities. 21

‘‘(16) RENEWABLE ELECTRICITY.—The term 22

‘renewable electricity’ means electricity generated 23

(including by means of a fuel cell) from a renewable 24

energy resource or other qualifying energy resources. 25


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‘‘(17) RENEWABLE ENERGY RESOURCE.—The 1

term ‘renewable energy resource’ means each of the 2

following: 3

‘‘(A) Wind energy. 4

‘‘(B) Solar energy. 5

‘‘(C) Geothermal energy. 6

‘‘(D) Renewable biomass. 7

‘‘(E) Biogas derived exclusively from re-8

newable biomass. 9

‘‘(F) Biofuels derived exclusively from re-10

newable biomass. 11

‘‘(G) Qualified hydropower. 12

‘‘(H) Marine and hydrokinetic renewable 13

energy, as that term is defined in section 632 14

of the Energy Independence and Security Act 15

of 2007 (42 U.S.C. 17211). 16

‘‘(18) RETAIL ELECTRIC SUPPLIER.— 17

‘‘(A) IN GENERAL.—The term ‘retail elec-18

tric supplier’ means, for any given year, an 19

electric utility that sold not less than 4,000,000 20

megawatt hours of electric energy to electric 21

consumers for purposes other than resale dur-22

ing the preceding calendar year. 23

‘‘(B) INCLUSIONS AND LIMITATIONS.—For 24

purposes of determining whether an electric 25


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utility qualifies as a retail electric supplier 1

under subparagraph (A)— 2

‘‘(i) the sales of any affiliate of an 3

electric utility to electric consumers, other 4

than sales to the affiliate’s lessees or ten-5

ants, for purposes other than resale shall 6

be considered to be sales of such electric 7

utility; and 8

‘‘(ii) sales by any electric utility to an 9

affiliate, lessee, or tenant of such electric 10

utility shall not be treated as sales to elec-11

tric consumers. 12

‘‘(C) AFFILIATE.—For purposes of this 13

paragraph, the term ‘affiliate’ when used in re-14

lation to a person, means another person that 15

directly or indirectly owns or controls, is owned 16

or controlled by, or is under common ownership 17

or control with, such person, as determined 18

under regulations promulgated by the Commis-19

sion. 20

‘‘(19) RETAIL ELECTRIC SUPPLIER’S BASE 21

AMOUNT.—The term ‘retail electric supplier’s base 22

amount’ means the total amount of electric energy 23

sold by the retail electric supplier, expressed in 24

megawatt hours, to electric customers for purposes 25


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other than resale during the relevant calendar year, 1

excluding— 2

‘‘(A) electricity generated by a hydro-3

electric facility that is not qualified hydropower; 4

‘‘(B) electricity generated by a nuclear 5

generating unit placed in service after the date 6

of enactment of this section; and 7

‘‘(C) the proportion of electricity generated 8

by a fossil-fueled generating unit that is equal 9

to the proportion of greenhouse gases produced 10

by such unit that are captured and geologically 11

sequestered. 12

‘‘(20) RETIRE AND RETIREMENT.—The terms 13

‘retire’ and ‘retirement’ with respect to a Federal re-14

newable electricity credit, means to disqualify such 15

credit for any subsequent use under this section, re-16

gardless of whether the use is a sale, transfer, ex-17

change, or submission in satisfaction of a compliance 18

obligation. 19

‘‘(21) THIRD-PARTY EFFICIENCY PROVIDER.— 20

The term ‘third-party efficiency provider’ means any 21

retailer, building owner, energy service company, fi-22

nancial institution or other commercial, industrial or 23

nonprofit entity that is capable of providing elec-24


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tricity savings in accordance with the requirements 1

of this section. 2

‘‘(22) TOTAL ANNUAL ELECTRICITY SAVINGS.— 3

The term ‘total annual electricity savings’ means 4

electricity savings during a specified calendar year 5

from measures implemented since the date of the en-6

actment of this section, taking into account verified 7

measure lifetimes or verified annual savings attrition 8

rates, as determined in accordance with such regula-9

tions as the Commission may promulgate and meas-10

ured in megawatt hours. 11

‘‘(b) ANNUAL COMPLIANCE OBLIGATION.— 12

‘‘(1) IN GENERAL.—For each of calendar years 13

2012 through 2039, not later than March 31 of the 14

following calendar year, each retail electric supplier 15

shall submit to the Commission an amount of Fed-16

eral renewable electricity credits and demonstrated 17

total annual electricity savings that, in the aggre-18

gate, is equal to such retail electric supplier’s annual 19

combined target as set forth in subsection (d), ex-20

cept as otherwise provided in subsection (h). 21

‘‘(2) DEMONSTRATION OF SAVINGS.—For pur-22

poses of this subsection, submission of demonstrated 23

total annual electricity savings means submission of 24

a report that demonstrates, in accordance with the 25


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requirements of subsection (f), the total annual elec-1

tricity savings achieved by the retail electric supplier 2

within the relevant compliance year. 3

‘‘(3) RENEWABLE ELECTRICITY CREDITS POR-4

TION.—Except as provided in paragraph (4), each 5

retail electric supplier must submit Federal renew-6

able electricity credits equal to at least three quar-7

ters of the retail electric supplier’s annual combined 8

target. 9

‘‘(4) STATE PETITION.— 10

‘‘(A) IN GENERAL.—Upon written request 11

from the Governor of any State (including, for 12

purposes of this paragraph, the Mayor of the 13

District of Columbia), the Commission shall in-14

crease, to not more than two fifths, the propor-15

tion of the annual combined targets of retail 16

electric suppliers located within such State that 17

may be met through submission of dem-18

onstrated total annual electricity savings, pro-19

vided that such increase shall be effective only 20

with regard to the portion of a retail electric 21

supplier’s annual combined target that is attrib-22

utable to electricity sales within such State. 23

‘‘(B) CONTENTS.—A Governor’s request 24

under this paragraph shall include an expla-25


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nation of the Governor’s rationale for deter-1

mining, after consultation with the relevant 2

State regulatory authority and other retail elec-3

tricity ratemaking authorities within the State, 4

to make such request. The request shall specify 5

the maximum proportion of annual combined 6

targets (not more than two fifths) that can be 7

met through demonstrated total annual elec-8

tricity savings, and the period for which such 9

proportion shall be effective. 10

‘‘(C) REVISION.—The Governor of any 11

State may, after consultation with the relevant 12

State regulatory authority and other retail elec-13

tricity ratemaking authorities within the State, 14

submit a written request for revocation or revi-15

sion of a previous request submitted under this 16

paragraph. The Commission shall grant such 17

request, provided that— 18

‘‘(i) any revocation or revision shall 19

not apply to the combined annual target 20

for any year that is any earlier than 2 cal-21

endar years after the calendar year in 22

which such request is submitted, so as to 23

provide retail electric suppliers with ade-24

quate notice of such change; and 25


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‘‘(ii) any revision shall meet the re-1

quirements of subparagraph (A). 2

‘‘(c) ESTABLISHMENT OF PROGRAM.—Not later than 3

1 year after the date of enactment of this section, the 4

Commission shall promulgate regulations to implement 5

and enforce the requirements of this section. In promul-6

gating such regulations, the Commission shall, to the ex-7

tent practicable— 8

‘‘(1) preserve the integrity, and incorporate best 9

practices, of existing State and tribal renewable elec-10

tricity and energy efficiency programs; 11

‘‘(2) rely upon existing and emerging State, 12

tribal, or regional tracking systems that issue and 13

track non-Federal renewable electricity credits; and 14

‘‘(3) cooperate with the States and Indian 15

tribes to facilitate coordination between State, tribal, 16

and Federal renewable electricity and energy effi-17

ciency programs and to minimize administrative bur-18

dens and costs to retail electric suppliers. 19

‘‘(d) ANNUAL COMPLIANCE REQUIREMENT.— 20

‘‘(1) ANNUAL COMBINED TARGETS.—For each 21

of calendar years 2012 through 2039, a retail elec-22

tric supplier’s annual combined target shall be the 23

product of— 24


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‘‘(A) the required annual percentage for 1

such year, as set forth in paragraph (2); and 2

‘‘(B) the retail electric supplier’s base 3

amount for such year. 4

‘‘(2) REQUIRED ANNUAL PERCENTAGE.—For 5

each of calendar years 2012 through 2039, the re-6

quired annual percentage shall be as follows: 7

‘‘Calendar year Required annual percentage

2012 ............................................................................... 6.0 2013 ............................................................................... 6.0 2014 ............................................................................... 9.5 2015 ............................................................................... 9.5 2016 ............................................................................... 13.0 2017 ............................................................................... 13.0 2018 ............................................................................... 16.5 2019 ............................................................................... 16.5 2020 ............................................................................... 20.0 2021 through 2039 ........................................................ 20.0

‘‘(e) FEDERAL RENEWABLE ELECTRICITY CRED-8

ITS.— 9

‘‘(1) IN GENERAL.—The regulations promul-10

gated under this section shall include provisions gov-11

erning the issuance, tracking, and verification of 12

Federal renewable electricity credits. Except as pro-13

vided in paragraphs (2), (3), and (4) of this sub-14

section, the Commission shall issue to each gener-15

ator of renewable electricity, 1 Federal renewable 16

electricity credit for each megawatt hour of renew-17

able electricity generated by such generator after 18

December 31, 2011. The Commission shall assign a 19


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unique serial number to each Federal renewable 1

electricity credit. 2

‘‘(2) GENERATION FROM CERTAIN STATE RE-3

NEWABLE ELECTRICITY PROGRAMS.—(A) Except as 4

provided in subparagraph (B), where renewable elec-5

tricity is generated with the support of payments 6

from a retail electric supplier pursuant to a State re-7

newable electricity program (whether through State 8

alternative compliance payments or through pay-9

ments to a State renewable electricity procurement 10

fund or entity), the Commission shall issue Federal 11

renewable electricity credits to such retail electric 12

supplier for the proportion of the relevant renewable 13

electricity generation that is attributable to the retail 14

electric supplier’s payments, as determined pursuant 15

to regulations issued by the Commission. For any 16

remaining portion of the relevant renewable elec-17

tricity generation, the Commission shall issue Fed-18

eral renewable electricity credits to the generator, as 19

provided in paragraph (1), except that in no event 20

shall more than 1 Federal renewable electricity cred-21

it be issued for the same megawatt hour of elec-22

tricity. In determining how Federal renewable elec-23

tricity credits will be apportioned among retail elec-24

tric suppliers and generators in such circumstances, 25


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the Commission shall consider information and guid-1

ance furnished by the relevant State or States. 2

‘‘(B) In the case of a central procurement State 3

that pursuant to subsection (g) has assumed respon-4

sibility for compliance with the requirements of sub-5

section (b), the Commission shall issue directly to 6

the State Federal renewable electricity credits for 7

any renewable electricity for which the State, pursu-8

ant to a mandate described in subsection (a)(7), has 9

centrally procured credits or certificates issued based 10

on generation of such renewable electricity. 11

‘‘(3) CERTAIN POWER SALES CONTRACTS.—Ex-12

cept as otherwise provided in paragraph (2), when a 13

generator has sold renewable electricity to a retail 14

electric supplier under a contract for power from a 15

facility placed in service before the date of enact-16

ment of this section, and the contract does not pro-17

vide for the determination of ownership of the Fed-18

eral renewable electricity credits associated with 19

such generation, the Commission shall issue such 20

Federal renewable electricity credits to the retail 21

electric supplier for the duration of the contract. 22

‘‘(4) CREDIT MULTIPLIER FOR DISTRIBUTED 23

RENEWABLE GENERATION.— 24


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‘‘(A) IN GENERAL.—Except as provided in 1

subparagraph (B), the Commission shall issue 3 2

Federal renewable electricity credits for each 3

megawatt hour of renewable electricity gen-4

erated by a distributed renewable generation fa-5

cility. 6

‘‘(B) ADJUSTMENT.—Except as provided 7

in subparagraph (C), not later than January 1, 8

2014, and not less frequently than every 4 9

years thereafter, the Commission shall review 10

the effect of this paragraph and shall, as nec-11

essary, reduce the number of Federal renewable 12

electricity credits per megawatt hour issued 13

under this paragraph for any given energy 14

source or technology, but not below 1, to ensure 15

that such number is no higher than the Com-16

mission determines is necessary to make dis-17

tributed renewable generation facilities using 18

such source or technology cost competitive with 19

other sources of renewable electricity genera-20

tion. 21

‘‘(C) FACILITIES PLACED IN SERVICE 22

AFTER ENACTMENT.—For any distributed re-23

newable generation facility placed in service 24

after the date of enactment of this section, sub-25


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paragraph (B) shall not apply for the first 10 1

years after the date on which the facility is 2

placed in service. For each year during such 10- 3

year period, the Commission shall issue to the 4

facility the same number of Federal renewable 5

electricity credits per megawatt hour as are 6

issued to that facility in the year in which such 7

facility is placed in service. After such 10-year 8

period, the Commission shall issue Federal re-9

newable electricity credits to the facility in ac-10

cordance with the current multiplier as deter-11

mined pursuant to subparagraph (B). 12

‘‘(5) CREDITS BASED ON QUALIFIED HYDRO-13

POWER.—For purposes of this subsection, the num-14

ber of Federal renewable electricity credits issued for 15

qualified hydropower shall be calculated— 16

‘‘(A) based solely on the increase in aver-17

age annual generation directly resulting from 18

the efficiency improvements or capacity addi-19

tions described in subsection (a)(13)(A); and 20

‘‘(B) using the same water flow informa-21

tion used to determine a historic average an-22

nual generation baseline for the hydroelectric 23

facility, as certified by the Commission. 24


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‘‘(6) GENERATION FROM QUALIFIED WASTE-TO- 1

ENERGY.—In the case of electricity generated from 2

the combustion of any municipal solid waste or con-3

struction, demolition, or disaster debris that is in-4

cluded in the definition of renewable biomass, or 5

from the gasification or pyrolization of such waste or 6

debris and the combustion of the resulting gas at 7

the same facility, the Commission shall issue Federal 8

renewable electricity credits only for electricity gen-9

erated from qualified waste-to-energy. 10

‘‘(7) GENERATION FROM MIXED RENEWABLE 11

AND NONRENEWABLE RESOURCES.—If electricity is 12

generated using both a renewable energy resource or 13

other qualifying energy resource and an energy 14

source that is not a renewable energy resource or 15

other qualifying energy resource (as, for example, in 16

the case of co-firing of renewable biomass and fossil 17

fuel), the Commission shall issue Federal renewable 18

electricity credits based on the proportion of the 19

electricity that is attributable to the renewable en-20

ergy resource or other qualifying energy resource. 21

‘‘(8) PROHIBITION AGAINST DOUBLE-COUNT-22

ING.—Except as provided in paragraph (4) of this 23

subsection, the Commission shall ensure that no 24

more than 1 Federal renewable electricity credit will 25


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be issued for any megawatt hour of renewable elec-1

tricity and that no Federal renewable electricity 2

credit will be used more than once for compliance 3

with this section. 4

‘‘(9) TRADING.—The lawful holder of a Federal 5

renewable electricity credit may sell, exchange, 6

transfer, submit for compliance in accordance with 7

subsection (b), or submit such credit for retirement 8

by the Commission. 9

‘‘(10) BANKING.—A Federal renewable elec-10

tricity credit may be submitted in satisfaction of the 11

compliance obligation set forth in subsection (b) for 12

the compliance year in which the credit was issued 13

or for any of the 3 immediately subsequent compli-14

ance years. The Commission shall retire any Federal 15

renewable electricity credit that has not been retired 16

by April 2 of the calendar year that is 3 years after 17

the calendar year in which the credit was issued. 18

‘‘(11) RETIREMENT.—The Commission shall re-19

tire a Federal renewable electricity credit imme-20

diately upon submission by the lawful holder of such 21

credit, whether in satisfaction of a compliance obli-22

gation under subsection (b) or on some other basis. 23

‘‘(f) ELECTRICITY SAVINGS.— 24


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‘‘(1) STANDARDS FOR MEASUREMENT OF SAV-1

INGS.—As part of the regulations promulgated 2

under this section, the Commission shall prescribe 3

standards and protocols for defining and measuring 4

electricity savings and total annual electricity sav-5

ings that can be counted towards the compliance ob-6

ligation set forth in subsection (b). Such protocols 7

and standards shall, at minimum— 8

‘‘(A) specify the types of energy efficiency 9

and energy conservation measures that can be 10

counted; 11

‘‘(B) require that energy consumption esti-12

mates for customer facilities or portions of fa-13

cilities in the applicable base and current years 14

be adjusted, as appropriate, to account for 15

changes in weather, level of production, and 16

building area; 17

‘‘(C) account for the useful life of meas-18

ures; 19

‘‘(D) include deemed savings values for 20

specific, commonly used measures; 21

‘‘(E) allow for savings from a program to 22

be estimated based on extrapolation from a rep-23

resentative sample of participating customers; 24


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‘‘(F) include procedures for counting CHP 1

savings, recycled energy savings, and fuel cell 2

savings; 3

‘‘(G) include procedures for documenting 4

measurable and verifiable electricity savings 5

achieved as a result of market transformation 6

efforts; 7

‘‘(H) include procedures for counting elec-8

tricity savings achieved by solar water heating 9

and solar light pipe technology that has the ca-10

pability to provide measurable data on the 11

amount of megawatt-hours displaced; 12

‘‘(I) avoid double-counting of savings used 13

for compliance with this section, including sav-14

ings that are transferred pursuant to paragraph 15

(3); 16

‘‘(J) ensure that, except as provided in 17

subparagraph (L), the retail electric supplier 18

claiming the savings played a significant role in 19

achieving the savings (including through the ac-20

tivities of a designated agent of the supplier or 21

through the purchase of transferred savings); 22

‘‘(K) include savings from programs ad-23

ministered by a retail electric supplier (or a re-24

tail electricity distributor that is not a retail 25


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electric supplier) that are funded by State, Fed-1

eral, or other sources; 2

‘‘(L) in any State in which the State regu-3

latory authority has designated 1 or more enti-4

ties to administer electric ratepayer-funded effi-5

ciency programs approved by such State regu-6

latory authority, provide that electricity savings 7

achieved through such programs shall be dis-8

tributed equitably among retail electric sup-9

pliers in accordance with the direction of the 10

relevant State regulatory authority; and 11

‘‘(M) exclude savings achieved as a result 12

of compliance with mandatory appliance and 13

equipment efficiency standards or building 14

codes. 15

‘‘(2) STANDARDS FOR THIRD-PARTY 16

VERIFICATION OF SAVINGS.—The regulations pro-17

mulgated under this section shall establish proce-18

dures and standards requiring third-party 19

verification of all reported electricity savings, includ-20

ing requirements for accreditation of third-party 21

verifiers to ensure that such verifiers are profes-22

sionally qualified and have no conflicts of interest. 23

‘‘(3) TRANSFERS OF SAVINGS.— 24


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‘‘(A) BILATERAL CONTRACTS FOR SAVINGS 1

TRANSFERS.—Subject to the limitations of this 2

paragraph, a retail electric supplier may use 3

electricity savings transferred, pursuant to a bi-4

lateral contract, from another retail electric 5

supplier, an owner of an electric distribution fa-6

cility that is not a retail electric supplier, a 7

State, or a third-party efficiency provider to 8

meet the applicable compliance obligation under 9

subsection (b). 10

‘‘(B) REQUIREMENTS.—Electricity savings 11

transferred and used for compliance pursuant 12

to this paragraph shall be— 13

‘‘(i) measured and verified in accord-14

ance with the procedures specified under 15

this subsection; 16

‘‘(ii) reported in accordance with 17

paragraph (4) of this subsection; and 18

‘‘(iii) achieved within the same State 19

as is served by the retail electric supplier. 20

‘‘(C) REGULATORY APPROVAL.—Nothing 21

in this paragraph shall limit or affect the au-22

thority of a State regulatory authority to re-23

quire a retail electric supplier that is regulated 24

by such authority to obtain such authority’s au-25


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thorization or approval of a contract for trans-1

fer of savings under this paragraph. 2

‘‘(4) REPORTING SAVINGS.— 3

‘‘(A) REQUIREMENTS.—The regulations 4

promulgated under this section shall establish 5

requirements governing the submission of re-6

ports to demonstrate, in accordance with the 7

protocols and standards for measurement and 8

third-party verification established under this 9

subsection, the total annual electricity savings 10

achieved by a retail electric supplier within the 11

relevant year. 12

‘‘(B) REVIEW AND APPROVAL.—The Com-13

mission shall review each report submitted to 14

the Commission by a retail electric supplier and 15

shall exclude any electricity savings that have 16

not been adequately demonstrated in accord-17

ance with the requirements of this subsection. 18

‘‘(5) STATE ADMINISTRATION.— 19

‘‘(A) DELEGATION OF AUTHORITY.—Upon 20

receipt of an application from the Governor of 21

a State (including, for purposes of this sub-22

section, the Mayor of the District of Columbia), 23

the Commission may delegate to the State the 24

authority to review and verify reported elec-25


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tricity savings for purposes of determining dem-1

onstrated total annual electricity savings that 2

may be counted towards a retail electric sup-3

plier’s compliance obligation under subsection 4

(b). The Commission shall make a substantive 5

determination approving or disapproving a 6

State application under this subparagraph, 7

after notice and comment, within 180 days of 8

receipt of a complete application. 9

‘‘(B) ALTERNATIVE MEASUREMENT AND 10

VERIFICATION PROCEDURES AND STAND-11

ARDS.—As part of an application submitted 12

under subparagraph (A), a State may request 13

to use alternative measurement and verification 14

procedures and standards to those specified in 15

paragraphs (1) and (2), provided the State 16

demonstrates that such alternative procedures 17

and standards provide a level of accuracy of 18

measurement and verification at least equiva-19

lent to the Federal procedures and standards 20

promulgated under paragraphs (1) and (2). 21

‘‘(C) REVIEW OF STATE IMPLEMENTA-22

TION.—The Commission shall, not less fre-23

quently than once every 4 years, review each 24

State’s implementation of delegated authority 25


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under this paragraph to ensure conformance 1

with the requirements of this section. The Com-2

mission may, at any time, revoke the delegation 3

of authority under this section upon a finding 4

that the State is not implementing its delegated 5

responsibilities in conformity with this para-6

graph. As a condition of maintaining its dele-7

gated authority under this paragraph, the Com-8

mission may require a State to submit a revised 9

application under subparagraph (A) if the Com-10

mission has— 11

‘‘(i) promulgated new or substantially 12

revised measurement and verification pro-13

cedures and standards under this sub-14

section; or 15

‘‘(ii) otherwise substantially revised 16

the program established under this section. 17

‘‘(g) ALTERNATIVE COMPLIANCE PAYMENTS.— 18

‘‘(1) IN GENERAL.—A retail electric supplier, or 19

a central procurement State that, pursuant to sub-20

section (g), has assumed responsibility for compli-21

ance with the requirements of subsection (b), may 22

satisfy the requirements of subsection (b) in whole 23

or in part by submitting in accordance with this sub-24

section, in lieu of each Federal renewable electricity 25


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credit or megawatt hour of demonstrated total an-1

nual electricity savings that would otherwise be due, 2

a payment equal to $25, adjusted for inflation on 3

January 1 of each year following calendar year 4

2009, in accordance with such regulations as the 5

Commission may promulgate. 6

‘‘(2) PAYMENT TO STATE FUNDS.—Except as 7

otherwise provided in this paragraph and paragraph 8

(4), payments made under this subsection shall be 9

made directly to the State or States in which the re-10

tail electric supplier is located, in proportion to the 11

portion of the retail electric supplier’s base amount 12

that is sold within each relevant State, provided that 13

such payments are deposited directly into a fund in 14

the State treasury established for this purpose and 15

that the State uses such funds in accordance with 16

paragraphs (3) and (5) and with paragraph (4), 17

where applicable. If the Commission determines at 18

any time that a State is in substantial noncompli-19

ance with paragraph (3) or (5), or with paragraph 20

(4), where applicable, the Commission shall direct 21

that any future alternative compliance payments 22

that would otherwise be paid to such State under 23

this subsection shall instead be paid to the Commis-24

sion and deposited in the United States Treasury. 25


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‘‘(3) STATE USE OF FUNDS.—As a condition of 1

continued receipt of alternative compliance payments 2

pursuant to this subsection, a State shall use such 3

payments exclusively for the purposes of— 4

‘‘(A) deploying technologies that generate 5

electricity from renewable energy resources; or 6

‘‘(B) implementing cost-effective energy ef-7

ficiency programs to achieve electricity savings. 8

‘‘(4) CENTRAL PROCUREMENT STATES.— 9

‘‘(A) IN GENERAL.—A central procurement 10

State that, pursuant to subsection (g), has as-11

sumed responsibility for compliance with the re-12

quirements of subsection (b) shall deposit any 13

alternative compliance payments under this 14

subsection in a unique fund in the State treas-15

ury created and used solely for this purpose. 16

‘‘(B) REQUIREMENTS.—As a precondition 17

of making alternative compliance payments 18

under this subsection, a central procurement 19

State shall certify to the Commission, in ac-20

cordance with such requirements as the Com-21

mission may prescribe, that— 22

‘‘(i) making such payments is the low-23

est cost alternative to meet the require-24

ments of subsection (b); and 25


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‘‘(ii) moneys used by the State to 1

make such payments are in addition to any 2

spending that the State, and any separate 3

entity charged with administering the 4

State central procurement requirement 5

identified under subsection (a)(7), other-6

wise collectively would direct to the pur-7

poses identified in paragraph (3). 8

‘‘(C) USES.—A central procurement State 9

that makes alternative compliance payments 10

under this subsection shall certify to the Com-11

mission that, in using such payments in accord-12

ance with paragraph (3), it has, to the extent 13

practicable, maximized the level of deployment 14

of renewable electricity generation (measured in 15

megawatt hours) and electricity savings per dol-16

lar that are achieved through such expendi-17

tures. 18

‘‘(5) REPORTING.—As a condition of continued 19

receipt of alternative compliance payments pursuant 20

to this subsection, a State shall, within 12 months 21

of receipt of any such payments and at 12-month in-22

tervals thereafter until such payments are expended, 23

provide a report to the Commission, in accordance 24

with such regulations as the Commission may pre-25


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scribe, giving a full accounting of the use of such 1

payments, including a detailed description of the ac-2

tivities funded thereby and demonstrating compli-3

ance with the requirements of this subsection. 4

‘‘(g) CENTRAL PROCUREMENT STATES.— 5

‘‘(1) IN GENERAL.—A central procurement 6

State may, upon submission of a written request by 7

the Governor of such State to the Commission, as-8

sume responsibility for compliance with the require-9

ments of subsection (b) on behalf of retail electric 10

suppliers located in such State, exclusively with re-11

gard to the portion of such retail electric suppliers’ 12

base amount that is sold within the State. 13

‘‘(2) DEMONSTRATION OF ELECTRICITY SAV-14

INGS.—If a central procurement State opts to meet 15

any part of the requirements of subsection (b) based 16

on the achievement of demonstrated total annual 17

electricity savings, regardless of whether such State 18

has received delegated authority pursuant to sub-19

section (f)(5), such State shall submit such dem-20

onstrated total annual electricity savings to the 21

Commission through an annual report in accordance 22

with requirements prescribed by the Commission by 23

regulation, which shall be of equivalent stringency to 24


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those applicable to retail electric suppliers under 1

subsection (f). 2

‘‘(3) NONCOMPLIANCE.—If a central procure-3

ment State that pursuant to this subsection has as-4

sumed responsibility for compliance with the require-5

ments of subsection (b), fails to satisfy the require-6

ments of subsection (b) or (h) for any year, the 7

State’s assumption of responsibility under this sub-8

section shall be discontinued immediately, and retail 9

electric suppliers located in such State henceforth 10

shall be directly subject to the requirements of this 11

section. 12

‘‘(h) INFORMATION COLLECTION.—The Commission 13

may require any retail electric supplier, renewable elec-14

tricity generator, or such other entities as the Commission 15

deems appropriate, to provide any information the Com-16

mission determines appropriate to carry out this section. 17

Failure to submit such information or submission of false 18

or misleading information under this subsection shall be 19

a violation of this section. 20

‘‘(i) ENFORCEMENT AND JUDICIAL REVIEW.— 21

‘‘(1) FAILURE TO SUBMIT CREDITS OR DEM-22

ONSTRATE SAVINGS.—If any person, other than any 23

central procurement State that pursuant to sub-24

section (g) has assumed responsibility for compliance 25


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with the requirements of subsection (b), fails to com-1

ply with the requirements of subsection (b) or (h), 2

such person shall be liable to pay to the Commission 3

a civil penalty equal to the product of— 4

‘‘(A) double the alternative compliance 5

payment calculated under subsection (h)(1), 6

and 7

‘‘(B) the aggregate quantity of Federal re-8

newable electricity credits, total annual elec-9

tricity savings, or equivalent alternative compli-10

ance payments that the person failed to submit 11

in violation of the requirements of subsections 12

(b) and (h). 13

‘‘(2) ENFORCEMENT.—The Commission shall 14

assess a civil penalty under paragraph (1) in accord-15

ance with the procedures described in section 31(d) 16

of the Federal Power Act (16 U.S.C. 823b(d)). 17

‘‘(3) VIOLATION OF REQUIREMENT OF REGULA-18

TIONS OR ORDERS.—Any person, other than any 19

central procurement State that pursuant to sub-20

section (g) has assumed responsibility for compliance 21

with the requirements of subsection (b), who vio-22

lates, or fails or refuses to comply with, any require-23

ment of a regulation promulgated or order issued 24

under this section shall be subject to a civil penalty 25


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under section 316A(b) of the Federal Power Act (16 1

U.S.C. 825o–1). Such penalty shall be assessed by 2

the Commission in the same manner as in the case 3

of a violation referred to in section 316A(b) of such 4

Act. 5

‘‘(j) JUDICIAL REVIEW.—Any person aggrieved by a 6

final action taken by the Commission under this section, 7

other than the assessment of a civil penalty under sub-8

section (j), may use the procedures for review described 9

in section 313 of the Federal Power Act (16 U.S.C. 825l). 10

For purposes of this paragraph, references to an order in 11

section 313 of such Act shall be deemed to refer also to 12

all other final actions of the Commission under this section 13

other than the assessment of a civil penalty under sub-14

section (i). 15

‘‘(k) SAVINGS PROVISIONS.—Nothing in this section 16

shall— 17

‘‘(1) diminish or qualify any authority of a 18

State, a political subdivision of a State, or an Indian 19

tribe to— 20

‘‘(A) adopt or enforce any law or regula-21

tion respecting renewable electricity or energy 22

efficiency, including any law or regulation es-23

tablishing requirements more stringent than 24

those established by this section, provided that 25


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no such law or regulation may relieve any per-1

son of any requirement otherwise applicable 2

under this section; or 3

‘‘(B) regulate the acquisition and disposi-4

tion of Federal renewable electricity credits by 5

retail electric suppliers within the jurisdiction of 6

such State, political subdivision, or Indian tribe, 7

including the authority to require such retail 8

electric supplier to acquire and submit to the 9

Secretary for retirement Federal renewable 10

electricity credits in excess of those submitted 11

under this section; or 12

‘‘(2) affect the application of, or the responsi-13

bility for compliance

calendar no. 97 th st congress session h. r. 2454 · sec. 133. support of indian renewable energy...

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