< Back to H.R. 4503 (108th Congress, 2003–2004)

Text of the Energy Policy Act of 2004

This bill was introduced in a previous session of Congress and was passed by the House on June 15, 2004 but was never passed by the Senate. The text of the bill below is as of Jun 3, 2004 (Introduced).

This is not the latest text of this bill.

Download PDF

Source: GPO

I

108th CONGRESS

2d Session

H. R. 4503

IN THE HOUSE OF REPRESENTATIVES

June 3, 2004

introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committees on Science, Ways and Means, Resources, Education and the Workforce, Transportation and Infrastructure, Financial Services, Agriculture, and Budget, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

A BILL

To enhance energy conservation and research and development, to provide for security and diversity in the energy supply for the American people, and for other purposes.

1.

Short title; table of contents

(a)

Short title

This Act may be cited as the Energy Policy Act of 2004.

(b)

Table of contents

The table of contents for this Act 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. 106. Energy Savings Performance Contracts pilot program for nonbuilding applications

Sec. 107. Voluntary commitments to reduce industrial energy intensity

Sec. 108. Advanced Building Efficiency Testbed

Sec. 109. Federal building performance standards

Sec. 110. Increased use of recovered mineral component in Federally funded projects involving procurement of cement or concrete

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

Sec. 132. HVAC maintenance consumer education program

Sec. 133. Energy conservation standards for additional products

Sec. 134. Energy labeling

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. 146. North American Development Bank

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

Subtitle B—Geothermal energy

Sec. 211. Short title

Sec. 212. Competitive lease sale requirements

Sec. 213. Direct use

Sec. 214. Royalties and near-term production incentives

Sec. 215. Geothermal leasing and permitting on Federal lands

Sec. 216. Review and report to Congress

Sec. 217. Reimbursement for costs of NEPA analyses, documentation, and studies

Sec. 218. Assessment of Geothermal energy potential

Sec. 219. Cooperative or Unit plans

Sec. 220. Royalty on byproducts

Sec. 221. Repeal of authorities of Secretary to readjust terms, conditions, rentals, and royalties

Sec. 222. Crediting of rental toward royalty

Sec. 223. Lease duration and work commitment requirements

Sec. 224. Advanced royalties required for suspension of production

Sec. 225. Annual rental

Sec. 226. Leasing and permitting on Federal lands withdrawn for military purposes

Sec. 227. Technical amendments

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

Sec. 246. Corps of Engineers hydropower operation and maintenance funding

Sec. 247. Limitation on certain charges assessed to the flint creek project, Montana

Sec. 248. Reinstatement and transfer

Title III—Oil and gas

Subtitle A—Petroleum Reserve and home heating oil

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

Sec. 302. National Oilheat Research Alliance

Subtitle B—Production incentives

Sec. 311. Definition of Secretary

Sec. 312. Program on oil and gas royalties in-kind

Sec. 313. Marginal property production incentives

Sec. 314. Incentives for natural gas production from deep wells in the shallow waters of the Gulf of Mexico

Sec. 315. Royalty Relief for deep water production

Sec. 316. Alaska offshore royalty suspension

Sec. 317. Oil and gas leasing in the National Petroleum Reserve in Alaska

Sec. 318. Orphaned, abandoned, or idled wells on Federal land

Sec. 319. Combined hydrocarbon leasing

Sec. 320. Liquified natural gas

Sec. 321. Alternate energy-related uses on the outer Continental Shelf

Sec. 322. Preservation of geological and geophysical data

Sec. 323. Oil and gas lease acreage limitations

Sec. 324. Assessment of dependence of State of Hawaii on oil

Sec. 325. Deadline for decision on appeals of consistency determination under the Coastal Zone Management Act of 1972

Sec. 326. Reimbursement for costs of NEPA analyses, documentation, and studies

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. 331. Bilateral international oil supply agreements

Sec. 332. Natural gas market reform

Sec. 333. Natural gas market transparency

Subtitle C—Access to Federal land

Sec. 341. Office of Federal Energy Project Coordination

Sec. 342. Federal onshore oil and gas leasing and permitting practices

Sec. 343. Management of Federal oil and gas leasing programs

Sec. 344. Consultation regarding oil and gas leasing on public land

Sec. 345. Estimates of oil and gas resources underlying onshore Federal land

Sec. 346. Compliance with executive order 13211; actions concerning regulations that significantly affect energy supply, distribution, or use

Sec. 347. Pilot Project to improve Federal permit coordination

Sec. 348. Deadline for consideration of applications for permits

Sec. 349. Clarification of fair market rental value determinations for public land and Forest Service rights-of-way

Sec. 350. Energy facility rights-of-way and corridors on Federal land

Sec. 351. Consultation regarding energy rights-of-way on public land

Sec. 352. Renewable energy on Federal land

Sec. 353. Electricity transmission line right-of-way, cleveland national forest and adjacent public land, California

Sec. 354. Sense of Congress regarding development of MINERALS under Padre Island National Seashore

Sec. 355. Encouraging prohibition of off-shore Drilling in the Great Lakes

Sec. 356. Finger Lakes National Forest withdrawal

Sec. 357. Study on lease exchanges in the rocky mountain front

Sec. 358. Federal coalbed methane regulation

Sec. 359. Livingston parish mineral rights transfer

Subtitle D—Alaska Natural Gas Pipeline

Sec. 371. Short title

Sec. 372. Definitions

Sec. 373. Issuance of certificate of public convenience and necessity

Sec. 374. Environmental reviews

Sec. 375. Pipeline expansion

Sec. 376. Federal Coordinator

Sec. 377. Judicial review

Sec. 378. State jurisdiction over in-State delivery of natural gas

Sec. 379. Study of alternative means of construction

Sec. 380. Clarification of angta status and authorities

Sec. 381. Sense of Congress concerning use of steel manufactured in North America negotiation of a project labor Agreement

Sec. 382. Sense of Congress and study concerning participation by small business concerns

Sec. 383. Alaska pipeline construction training Program

Sec. 384. Sense of Congress concerning natural gas demand

Sec. 385. Sense of Congress concerning Alaskan ownership

Sec. 386. Loan guarantees

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. 413. Integrated gasification combined cycle technology

Sec. 414. Petroleum coke gasification

Sec. 415. Integrated coal/renewable energy system

Sec. 416. Electron scrubbing demonstration

Subtitle C—Federal Coal Leases

Sec. 421. Repeal of the 160-acre limitation for coal leases

Sec. 422. Mining plans

Sec. 423. Payment of advance royalties under coal leases

Sec. 424. Elimination of deadline for submission of coal lease operation and reclamation plan

Sec. 425. Amendment relating to financial assurances with respect to bonus bids

Sec. 426. Inventory requirement

Sec. 427. Application of amendments

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. Four corners transmission line project

Sec. 505. Energy efficiency in federally assisted housing

Sec. 506. Consultation with Indian tribes

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

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. 628. Decommissioning pilot program

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. 637. Uranium enrichment facilities

Sec. 638. National uranium stockpile

Subtitle C—Advanced Reactor Hydrogen Cogeneration Project

Sec. 651. Project establishment

Sec. 652. Project definition

Sec. 653. Project management

Sec. 654. Project requirements

Sec. 655. Authorization of appropriations

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. 702. Neighborhood electric vehicles

Sec. 703. Credits for medium and heavy duty dedicated vehicles

Sec. 704. Incremental cost allocation

Sec. 705. Alternative compliance and flexibility

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 I—Hybrid vehicles

Sec. 711. Hybrid vehicles

Part II—Advanced vehicles

Sec. 721. Definitions

Sec. 722. Pilot program

Sec. 723. Reports to Congress

Sec. 724. Authorization of appropriations

Part III—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. 755. Conserve by Bicycling Program

Sec. 756. Reduction of engine idling of heavy-duty vehicles

Sec. 757. Biodiesel engine testing program

Sec. 758. High occupancy vehicle exception

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

Title IX—Research and Development

Sec. 901. Goals

Sec. 902. Definitions

Subtitle A—Energy Efficiency

Sec. 904. Energy efficiency

Sec. 905. Next generation lighting initiative

Sec. 906. National building performance initiative

Sec. 907. Secondary electric vehicle battery use program

Sec. 908. Energy efficiency science initiative

Sec. 909. Electric motor control technology

Sec. 910. Advanced energy technology transfer centers

Subtitle B—Distributed Energy and Electric Energy Systems

Sec. 911. Distributed energy and electric energy systems

Sec. 912. Hybrid distributed power systems

Sec. 913. High power density industry program

Sec. 914. Micro-cogeneration energy technology

Sec. 915. Distributed energy technology demonstration program

Sec. 916. Reciprocating power

Subtitle C—Renewable energy

Sec. 918. Renewable energy

Sec. 919. Bioenergy programs

Sec. 920. Concentrating solar power research and development Program

Sec. 921. Miscellaneous projects

Sec. 922. Renewable energy in public buildings

Sec. 923. Study of marine renewable energy options

Subtitle D—Nuclear energy

Sec. 924. Nuclear energy

Sec. 925. Nuclear energy research and development programs

Sec. 926. Advanced fuel cycle Initiative

Sec. 927. University nuclear science and engineering support

Sec. 928. Security of reactor designs

Sec. 929. Alternatives to industrial radioactive sources

Sec. 930. Geological isolation of spent fuel

Subtitle E—Fossil energy

Part I—Research programs

Sec. 931. Fossil energy

Sec. 932. Oil and gas research programs

Sec. 933. Technology transfer

Sec. 934. Research and development for coal mining technologies

Sec. 935. Coal and related technologies Program

Sec. 936. Complex Well Technology Testing Facility

Sec. 937. Fischer-Tropsch diesel fuel loan guarantee Program

Part II—Ultra-deepwater and unconventional natural gas and other petroleum resources

Sec. 941. Program authority

Sec. 942. Ultra-deepwater Program

Sec. 943. Unconventional natural gas and other petroleum resources Program

Sec. 944. Additional requirements for awards

Sec. 945. Advisory committees

Sec. 946. Limits on participation

Sec. 947. Sunset

Sec. 948. Definitions

Sec. 949. Funding

Subtitle F—Science

Sec. 951. Science

Sec. 952. United States participation in ITER

Sec. 953. Plan for Fusion Energy Sciences Program

Sec. 954. Spallation Neutron Source

Sec. 955. Support for science and energy facilities and infrastructure

Sec. 956. Catalysis Research and development Program

Sec. 957. Nanoscale Science and Engineering Research, development, demonstration, and commercial application

Sec. 958. Advanced scientific computing for energy missions

Sec. 959. Genomes to Life Program

Sec. 960. Fission and fusion energy materials research Program

Sec. 961. Energy-Water Supply Program

Sec. 962. Nitrogen fixation

Subtitle G—Energy and environment

Sec. 964. United States-Mexico energy Technology cooperation

Sec. 965. Western Hemisphere energy cooperation

Sec. 966. Waste reduction and use of alternatives

Sec. 967. Report on fuel cell test Center

Sec. 968. Arctic Engineering Research Center

Sec. 969. Barrow Geophysical Research Facility

Sec. 970. Western Michigan demonstration project

Subtitle H—Management

Sec. 971. Availability of funds

Sec. 972. Cost sharing

Sec. 973. Merit review of proposals

Sec. 974. External technical review of departmental programs

Sec. 975. Improved coordination of Technology transfer activities

Sec. 976. Federal laboratory educational partners

Sec. 977. Interagency cooperation

Sec. 978. Technology Infrastructure Program

Sec. 979. Reprogramming

Sec. 980. Construction with other laws

Sec. 981. Report on research and development Program evaluation methodologies

Sec. 982. Department of Energy Science and Technology Scholarship Program

Sec. 983. Report on equal employment opportunity practices

Sec. 984. Small business advocacy and assistance

Sec. 985. Report on mobility of scientific and technical personnel

Sec. 986. National Academy of Sciences report

Sec. 987. Outreach

Sec. 988. Competitive award of management contracts

Sec. 989. Educational programs in science and mathematics

Title X—Department of energy management

Sec. 1001. Additional Assistant Secretary position

Sec. 1002. Other transactions authority

Title XI—Personnel and training

Sec. 1101. Training guidelines for electric energy industry personnel

Sec. 1102. Improved access to energy-related scientific and technical careers

Sec. 1103. National Power Plant Operations Technology and Education Center

Sec. 1104. International energy training

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

Sec. 1242. Voluntary transmission pricing plans

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

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

Subtitle J—Technical and conforming amendments

Sec. 1297. Conforming amendments

Title XIII—Energy tax incentives

Sec. 1300. Short title; amendment of 1986 Code

Subtitle A—Conservation

Part I—Residential and business property

Sec. 1301. Credit for residential energy efficient property

Sec. 1302. Extension and expansion of credit for electricity produced from certain renewable resources

Sec. 1303. Credit for business installation of qualified fuel cells

Sec. 1304. Credit for energy efficiency improvements to existing homes

Sec. 1305. Credit for construction of new energy efficient homes

Sec. 1306. Energy credit for combined heat and power system property

Sec. 1307. Credit for energy efficient appliances

Sec. 1308. Energy efficient commercial buildings deduction

Sec. 1309. Three-year applicable recovery period for depreciation of qualified energy management devices

Sec. 1310. Credit for production from advanced nuclear power facilities

Part II—Fuels and alternative motor vehicles

Sec. 1311. Repeal of 4.3-cent motor fuel excise taxes on railroads and inland waterway transportation which remain in general Fund

Sec. 1312. Reduced motor fuel excise tax on certain mixtures of diesel fuel

Sec. 1313. Small ethanol producer credit

Sec. 1314. Incentives for biodiesel

Sec. 1315. Alcohol fuel and biodiesel mixtures excise tax credit

Sec. 1316. Nonapplication of export exemption to delivery of fuel to motor vehicles removed from United States

Sec. 1317. Repeal of phaseouts for qualified electric vehicle credit and deduction for clean fuel-vehicles

Sec. 1318. Alternative motor vehicle credit

Sec. 1319. Modifications of deduction for certain refueling property

Subtitle B—Reliability

Sec. 1321. Natural gas gathering lines treated as 7-YEAR property

Sec. 1322. Natural gas distribution lines treated as 15-year property

Sec. 1323. Electric transmission property treated as 15-year property

Sec. 1324. Expensing of capital costs incurred in complying with Environmental Protection Agency sulfur regulations

Sec. 1325. Credit for production of low sulfur diesel fuel

Sec. 1326. Determination of small refiner exception to oil depletion deduction

Sec. 1327. Sales or dispositions to implement Federal Energy Regulatory Commission or State electric restructuring policy

Sec. 1328. Modifications to special rules for nuclear decommissioning costs

Sec. 1329. Treatment of certain income of cooperatives

Sec. 1330. Arbitrage rules not to apply to prepayments for natural gas

Subtitle C—Production

Part I—Oil and gas provisions

Sec. 1341. Oil and gas from marginal wells

Sec. 1342. Temporary suspension of limitation based on 65 percent of taxable income and extension of suspension of taxable income limit with respect to marginal production

Sec. 1343. Amortization of delay rental payments

Sec. 1344. Amortization of geological and geophysical expenditures

Sec. 1345. Extension and modification of credit for producing fuel from a nonconventional source

Part II—Alternative minimum tax provisions

Sec. 1346. New nonrefundable personal credits allowed against regular and minimum taxes

Sec. 1347. Business related energy credits allowed against regular and minimum tax

Sec. 1348. Temporary repeal of alternative minimum tax preference for intangible drilling costs

Part III—Clean coal incentives

Sec. 1351. Credit for clean coal technology units

Sec. 1352. Expansion of amortization for certain pollution control facilities

Sec. 1353. 5-year recovery period for eligible integrated gasification combined cycle technology unit eligible for credit

Part IV—High volume natural gas provisions

Sec. 1355. High volume natural gas pipe treated as 7-year property

Sec. 1356. Extension of enhanced oil recovery credit to high volume natural gas facilities

Subtitle D—Additional provisions

Sec. 1361. Extension of accelerated depreciation benefit for energy-related businesses on indian reservations

Sec. 1362. Payment of dividends on stock of cooperatives without reducing patronage dividends

Sec. 1363. Distributions from publicly traded partnerships treated as qualifying income of regulated investment companies

Sec. 1364. Ceiling fans

Sec. 1365. Certain steam generators, and certain reactor vessel heads, used in nuclear facilities

Sec. 1366. Brownfields demonstration program for qualified green building and sustainable design projects

Title XIV—Miscellaneous

Subtitle A—Rural and Remote Electricity Construction

Sec. 1401. Denali Commission programs

Sec. 1402. Rural and remote community assistance

Subtitle B—Coastal programs

Sec. 1411. Royalty payments under leases under the Outer Continental Shelf Lands Act

Sec. 1412. Domestic offshore energy reinvestment

Subtitle C—Reforms to the Board of Directors of the Tennessee Valley Authority

Sec. 1431. Change in composition, operation, and duties of the Board of Directors of the Tennessee Valley Authority

Sec. 1432. Change in manner of appointment of staff

Sec. 1433. Conforming amendments

Sec. 1434. Appointments; effective date; transition

Subtitle D—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. 1445. Use of granular mine tailings

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. Resource Center

Sec. 1513. Cellulosic biomass and waste-derived ethanol conversion assistance

Sec. 1514. 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. Future release containment technology

Sec. 1531. Authorization of appropriations

Sec. 1532. Conforming amendments

Sec. 1533. Technical amendments

Title XVI—Studies

Sec. 1601. Study on inventory of petroleum and natural gas storage

Sec. 1602. Natural gas supply shortage report

Sec. 1603. Split-estate Federal oil and gas leasing and development practices

Sec. 1604. Resolution of Federal resource development conflicts in the Powder River Basin

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

I

Energy efficiency

A

Federal programs

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:

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 2004 through 2008.

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 2004 through 2013 is reduced, as compared with the energy consumption per gross square foot of the Federal buildings of the agency in fiscal year 2001, by the percentage specified in the following table:

Fiscal YearPercentage reduction
20042
20054
20066
20078
200810
200912
201014
201116
201218
201320.

.

(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, 2012, 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 2014 through 2023.

.

(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)..

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, 2010, 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.

.

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:

553.

Federal procurement of energy efficient products

(a)

Definitions

In this section:

(1)

Energy Star product

The term Energy Star product means a product that is rated for energy efficiency under an Energy Star program.

(2)

Energy Star Program

The term Energy Star program means the program established by section 324A of the Energy Policy and Conservation Act.

(3)

Executive Agency

The term executive agency has the meaning given the term in section 4 of the Office of Federal Procurement Policy Act (41 U.S.C. 403).

(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 executive agency for an energy consuming product, the head of the executive 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 executive agency is not required to procure an Energy Star product or FEMP designated product under paragraph (1) if the head of the executive 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 executive agency.

(3)

Procurement planning

The head of an executive agency shall incorporate into the specifications for all procurements involving energy consuming products and systems, including guide specifications, project specifications, and construction, renovation, and services contracts that include provision of energy consuming products and systems, and into the factors for the evaluation of offers received for the procurement, criteria for energy efficiency that are consistent with the criteria used for rating Energy Star products and for rating FEMP designated products.

(c)

Listing of energy efficient products in Federal catalogs

Energy Star products and FEMP designated products shall be clearly identified and prominently displayed in any inventory or listing of products by the General Services Administration or the Defense Logistics Agency. The General Services Administration or the Defense Logistics Agency shall supply only Energy Star products or FEMP designated products for all product categories covered by the Energy Star program or the Federal Energy Management Program, except in cases where the agency ordering a product specifies in writing that no Energy Star product or FEMP designated product is available to meet the buyer’s functional requirements, or that no Energy Star product or FEMP designated product is cost-effective for the intended application over the life of the product, taking energy cost savings into account.

(d)

Specific products

(1)

In the case of electric motors of 1 to 500 horsepower, agencies shall select only premium efficient motors that meet a standard designated by the Secretary. The Secretary shall designate such a standard not later than 120 days after the date of the enactment of this section, after considering the recommendations of associated electric motor manufacturers and energy efficiency groups.

(2)

All Federal agencies are encouraged to take actions to maximize the efficiency of air conditioning and refrigeration equipment, including appropriate cleaning and maintenance, including the use of any system treatment or additive that will reduce the electricity consumed by air conditioning and refrigeration equipment. Any such treatment or additive must be—

(A)

determined by the Secretary to be effective in increasing the efficiency of air conditioning and refrigeration equipment without having an adverse impact on air conditioning 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

.

105.

Energy Savings Performance Contracts

(a)

Permanent extension

Effective September 30, 2003, section 801(c) of the National Energy Conservation Policy Act (42 U.S.C. 8287(c)) is repealed.

(b)

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.

(c)

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.

.

(d)

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.

.

(e)

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.

.

(f)

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.

(g)

Extension of authority

Any energy savings performance contract entered into under section 801 of the National Energy Conservation Policy Act (42 U.S.C. 8287) after October 1, 2003, and before the date of enactment of this Act, shall be deemed to have been entered into pursuant to such section 801 as amended by subsection (a) of this section.

106.

Energy Savings Performance Contracts pilot program for nonbuilding applications

(a)

In general

The Secretary of Defense and the heads of other interested Federal agencies are authorized to enter into up to 10 energy savings performance contracts using procedures, established under subsection (b), based on the procedures under title VIII of the National Energy Conservation Policy Act (42 U.S.C. 8287 et seq.), for the purpose of achieving energy or water savings, secondary savings, and benefits incidental to those purposes, in nonbuilding applications. The payments to be made by the Federal Government under such contracts shall not exceed a total of $200,000,000 for all such contracts combined.

(b)

Procedures

The Secretary of Energy, in consultation with the Administrator of General Services and the Secretary of Defense, shall establish procedures based on the procedures under title VIII of the National Energy Conservation Policy Act (42 U.S.C. 8287 et seq.), for implementing this section.

(c)

Definitions

In this section:

(1)

Nonbuilding application

The term nonbuilding application means—

(A)

any class of vehicles, devices, or equipment that are transportable under their own power by land, sea, or air that consume energy from any fuel source for the purpose of such transportability, or to maintain a controlled environment within such vehicle, device, or equipment; or

(B)

any Federally owned equipment used to generate electricity or transport water.

(2)

Secondary savings

The term secondary savings means additional energy or cost savings that are a direct consequence of the energy or water savings that result from the financing and implementation of the energy savings performance contract, including, but not limited to, energy or cost savings that result from a reduction in the need for fuel delivery and logistical support, or the increased efficiency in the production of electricity.

(d)

Report

Not later than 3 years after the date of enactment of this section, the Secretary of Energy shall report to Congress on the progress and results of the projects funded pursuant to this section. Such report shall include a description of projects undertaken; the energy, water, and cost savings, secondary savings, and other benefits that resulted from such projects; and recommendations on whether the pilot program should be extended, expanded, or authorized permanently as a part of the program authorized under title VIII of the National Energy Conservation Policy Act (42 U.S.C. 8287 et seq.).

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.

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.

(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 2004 through 2006, 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.

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.

.

110.

Increased use of recovered mineral component in Federally funded projects involving procurement of cement or concrete

(a)

Amendment

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

6005.

Increased use of recovered mineral component in Federally funded projects involving procurement of cement or concrete

(a)

Definitions

In this section:

(1)

Agency head

The term agency head means—

(A)

the Secretary of Transportation; and

(B)

the head of each other Federal agency that on a regular basis procures, or provides Federal funds to pay or assist in paying the cost of procuring, material for cement or concrete projects.

(2)

Cement or concrete project

The term cement or concrete project means a project for the construction or maintenance of a highway or other transportation facility or a Federal, State, or local government building or other public facility that—

(A)

involves the procurement of cement or concrete; and

(B)

is carried out in whole or in part using Federal funds.

(3)

Recovered mineral component

The term recovered mineral component means—

(A)

ground granulated blast furnace slag;

(B)

coal combustion fly ash; and

(C)

any other waste material or byproduct recovered or diverted from solid waste that the Administrator, in consultation with an agency head, determines should be treated as recovered mineral component under this section for use in cement or concrete projects paid for, in whole or in part, by the agency head.

(b)

Implementation of requirements

(1)

In general

Not later than 1 year after the date of enactment of this section, the Administrator and each agency head shall take such actions as are necessary to implement fully all procurement requirements and incentives in effect as of the date of enactment of this section (including guidelines under section 6002) that provide for the use of cement and concrete incorporating recovered mineral component in cement or concrete projects.

(2)

Priority

In carrying out paragraph (1) an agency head shall give priority to achieving greater use of recovered mineral component in cement or concrete projects for which recovered mineral components historically have not been used or have been used only minimally.

(3)

Conformance

The Administrator and each agency head shall carry out this subsection in accordance with section 6002.

(c)

Full implementation study

(1)

In general

The Administrator, in cooperation with the Secretary of Transportation and the Secretary of Energy, shall conduct a study to determine the extent to which current procurement requirements, when fully implemented in accordance with subsection (b), may realize energy savings and environmental benefits attainable with substitution of recovered mineral component in cement used in cement or concrete projects.

(2)

Matters to be addressed

The study shall—

(A)

quantify the extent to which recovered mineral components are being substituted for Portland cement, particularly as a result of current procurement requirements, and the energy savings and environmental benefits associated with that substitution;

(B)

identify all barriers in procurement requirements to greater realization of energy savings and environmental benefits, including barriers resulting from exceptions from current law; and

(C)
(i)

identify potential mechanisms to achieve greater substitution of recovered mineral component in types of cement or concrete projects for which recovered mineral components historically have not been used or have been used only minimally;

(ii)

evaluate the feasibility of establishing guidelines or standards for optimized substitution rates of recovered mineral component in those cement or concrete projects; and

(iii)

identify any potential environmental or economic effects that may result from greater substitution of recovered mineral component in those cement or concrete projects.

(3)

Report

Not later than 30 months after the date of enactment of this section, the Administrator shall submit to Congress a report on the study.

(d)

Additional procurement requirements

Unless the study conducted under subsection (c) identifies any effects or other problems described in subsection (c)(2)(C)(iii) that warrant further review or delay, the Administrator and each agency head shall, not later than 1 year after the release of the report in accordance with subsection (c)(3), take additional actions authorized under this Act to establish procurement requirements and incentives that provide for the use of cement and concrete with increased substitution of recovered mineral component in the construction and maintenance of cement or concrete projects, so as to—

(1)

realize more fully the energy savings and environmental benefits associated with increased substitution; and

(2)

eliminate barriers identified under subsection (c).

(e)

Effect of Section

Nothing in this section affects the requirements of section 6002 (including the guidelines and specifications for implementing those requirements).

.

(b)

Table of contents amendment

The table of contents of the Solid Waste Disposal Act is amended by adding after the item relating to section 6004 the following new item:

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

.

B

Energy assistance and State programs

121.

Low income home energy assistance program

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 $2,000,000,000 for fiscal years 2002 and 2003, and $3,400,000,000 for each of fiscal years 2004 through 2006.

122.

Weatherization assistance

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 $325,000,000 for fiscal year 2004, $400,000,000 for fiscal year 2005, and $500,000,000 for fiscal year 2006.

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:

364.

State energy efficiency goals

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 2003 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 2010 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 2004 and 2005 and $125,000,000 for fiscal year 2006.

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 $50,000,000 for each of the fiscal years 2004 through 2008.

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 2004 through 2008. Not more than 10 percent of appropriated funds shall be used for administration.

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 2004 through 2006.

C

Energy efficient products

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:

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

.

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.

.

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.

(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, harmonic 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.

.

(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.

; 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, 2005, 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, 2005—

(1)

shall consume not more than 190 watts of power; and

(2)

shall not be capable of operating with lamps that total more than 190 watts.

(y)

Low voltage dry-type Distribution Transformers

The efficiency of low voltage dry-type distribution transformers manufactured on or after January 1, 2005, 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, 2005, 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.

.

(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.

.

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.

.

(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.

.

D

Public housing

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.

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.

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 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.

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.

.

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..

146.

North American Development Bank

Part 2 of subtitle D of title V of the North American Free Trade Agreement Implementation Act (22 U.S.C. 290m–290m-3) is amended by adding at the end the following:

545.

Support for certain energy policies

Consistent with the focus of the Bank’s Charter on environmental infrastructure projects, the Board members representing the United States should use their voice and vote to encourage the Bank to finance projects related to clean and efficient energy, including energy conservation, that prevent, control, or reduce environmental pollutants or contaminants.

.

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.

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, 2004;

(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, 2004; 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.

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.

II

Renewable energy

A

General provisions

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 2004 through 2008.

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-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, 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, 2003, and before October 1, 2013.

(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, 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, 2023.

(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 2003 through 2023.

(2)

Availability of funds

Funds made available under paragraph (1) shall remain available until expended.

.

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 2005 through 2007.

(2)

Not less than 5 percent in fiscal years 2008 through 2010.

(3)

Not less than 7.5 percent in fiscal year 2011 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, 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, 2005, 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.

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 2010, 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, 2005, 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.

.

205.

Use of photovoltaic energy in public buildings

(a)

In General

Subchapter VI of chapter 31 of title 40, United States Code, is amended by adding at the end the following:

3177.

Use of photovoltaic energy in public buildings

(a)

Photovoltaic energy commercialization program

(1)

In General

The Administrator of General Services may establish a photovoltaic energy commercialization program for the procurement and installation of photovoltaic solar electric systems for electric production in new and existing public buildings.

(2)

Purposes

The purposes of the program shall be to accomplish the following:

(A)

To accelerate the growth of a commercially viable photovoltaic industry to make this energy system available to the general public as an option which can reduce the national consumption of fossil fuel.

(B)

To reduce the fossil fuel consumption and costs of the Federal Government.

(C)

To attain the goal of installing solar energy systems in 20,000 Federal buildings by 2010, as contained in the Federal Government’s Million Solar Roof Initiative of 1997.

(D)

To stimulate the general use within the Federal Government of life-cycle costing and innovative procurement methods.

(E)

To develop program performance data to support policy decisions on future incentive programs with respect to energy.

(3)

Acquisition of photovoltaic solar electric systems

(A)

In General

The program shall provide for the acquisition of photovoltaic solar electric systems and associated storage capability for use in public buildings.

(B)

Acquisition levels

The acquisition of photovoltaic electric systems shall be at a level substantial enough to allow use of low-cost production techniques with at least 150 megawatts (peak) cumulative acquired during the 5 years of the program.

(4)

Administration

The Administrator shall administer the program and shall—

(A)

issue such rules and regulations as may be appropriate to monitor and assess the performance and operation of photovoltaic solar electric systems installed pursuant to this subsection;

(B)

develop innovative procurement strategies for the acquisition of such systems; and

(C)

transmit to Congress an annual report on the results of the program.

(b)

Photovoltaic systems evaluation program

(1)

In General

Not later than 60 days after the date of enactment of this section, the Administrator, in consultation with the Secretary of Energy, shall establish a photovoltaic solar energy systems evaluation program to evaluate such photovoltaic solar energy systems as are required in public buildings.

(2)

Program requirement

In evaluating photovoltaic solar energy systems under the program, the Administrator shall ensure that such systems reflect the most advanced technology.

(c)

Authorization of appropriations

(1)

Photovoltaic energy commercialization program

There are authorized to be appropriated to carry out subsection (a) $50,000,000 for each of fiscal years 2004 through 2008. 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 2004 through 2008. Such sums shall remain available until expended.

.

(b)

Conforming amendment

The section analysis for such chapter is amended by inserting after the item relating to section 3176 the following:

3177. Use of photovoltaic energy in public buildings

.

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 2004 through 2014 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.

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.

B

Geothermal energy

211.

Short title

This subtitle may be cited as the John Rishel Geothermal Steam Act Amendments of 2004.

212.

Competitive lease sale requirements

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

4.

Leasing procedures

(a)

Nominations

The Secretary shall accept nominations of lands to be leased 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.

(c)

Noncompetitive leasing

The Secretary shall make available for a period of 2 years for noncompetitive leasing any tract for which a competitive lease sale is held, but for which the Secretary does not receive any bids in a competitive lease sale.

(d)

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)

Pending lease applications on April 1, 2003

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 April 1, 2003. Such an application, and any lease issued pursuant to such an application—

(1)

except as provided in paragraph (2), shall be subject to this section as in effect on April 1, 2003; or

(2)

at the election of the applicant, shall be subject to this section as in effect on the effective date of this paragraph.

.

213.

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)

Direct use

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 based upon the total amount of the geothermal resources used. The schedule of fees shall ensure that there is a fair return to the public for the use of a geothermal resource based upon comparable fees charged for direct use of geothermal resources by States or private persons. For direct use by a State or local government for public purposes there shall be no royalty and the fee charged shall be nominal. Leases in existence on the date of enactment of the Energy Policy Act of 2003 shall be modified in order to reflect the provisions of this subsection.

.

(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 the enactment of this Act may apply to the Secretary of the Interior, by not later than 18 months after the date of the 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 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.

214.

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 steam and associated geothermal resources, other than direct use of geothermal resources, that shall be—

(A)

not less than 1 percent and not more than 2.5 percent of the gross proceeds from the sale of electricity produced from such resources during the first 10 years of production under the lease; and

(B)

not less than 2 and not more than 5 percent of the gross proceeds from the sale of electricity produced from such resources during each year after such 10-year period;

; and

(2)

by adding at the end the following:

(c)

Final regulation establishing royalty rates

In issuing any final regulation establishing royalty rates under this section, the Secretary shall seek—

(1)

to provide lessees a simplified administrative system;

(2)

to encourage new development; and

(3)

to achieve the same long-term level of royalty revenues to States and counties as the regulation in effect on the date of enactment of this subsection.

(d)

Credits for in-kind payments of electricity

The Secretary may provide to a lessee a credit against royalties owed under this Act, in an amount equal to the value of electricity provided under contract to a State or county government that is entitled to a portion of such royalties under section 20 of this Act, section 35 of the Mineral Leasing Act (30 U.S.C. 191), 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 rentals

Section 20 of the Geothermal Steam Act of 1970 (30 U.S.C. 1019) is amended to read as follows:

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 the 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 the 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.

(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 the 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 the enactment of this Act.

(2)

Application of modification

Such modification shall apply to any use of geothermal steam and any associated 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 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.

215.

Geothermal leasing and permitting on Federal lands

(a)

In General

Not later than 180 days after the date of the 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 regarding 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)

identify areas with geothermal potential on lands included in the National Forest System and, when necessary, require review of management plans to consider leasing under the Geothermal Steam Act of 1970 (30 U.S.C. 1001 et seq.) as a land use; and

(2)

establish an administrative procedure for processing geothermal lease applications, including lines of authority, steps in application processing, and time limits for application procession.

(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.

216.

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 the 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.

217.

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:

30.

Reimbursement for costs of certain analyses, documentation, and studies

(a)

In General

The Secretary of the Interior may 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.

218.

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.

219.

Cooperative or Unit plans

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

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 owners of 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 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 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 steam and associated 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.

.

220.

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;

.

221.

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).

222.

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.

.

223.

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:

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 production or utilization of steam under the lease;

(B)

require that in each year to which work commitment requirements under the regulations apply, the lessee shall significantly reduce the amount of work that remains to be done to achieve such production or utilization;

(C)

describe specific work that must be completed by a lessee by the end of each year to which the work commitment requirements apply and factors, such as force majeure events, that suspend or modify the work commitment obligation;

(D)

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;

(E)

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

(F)

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)

Termination of application of requirements

Work commitment requirements prescribed under this subsection shall not apply to a geothermal lease after the date on which geothermal steam is produced or 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 of that period, the lease shall terminate upon the expiration of the period.

(e)

Continuation after commercial production or utilization

If geothermal steam is produced or 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 geothermal steam is no longer produced or utilized in commercial quantities.

(f)

Conversion of Geothermal lease to mineral lease

The lessee under a lease that has produced geothermal steam for electrical generation, has been determined by the Secretary to be incapable of any further commercial production or utilization of geothermal steam, and that 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.

.

224.

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 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)

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)

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.

.

225.

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 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 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.

.

226.

Leasing and permitting on Federal lands withdrawn for military purposes

Not later than 2 years after the date of enactment of this Act, the Secretary of the Interior and the Secretary of Defense, in consultation with each military service and with interested States, counties, representatives of the geothermal industry, and other persons, shall submit to Congress a joint report concerning leasing and permitting activities for geothermal energy on Federal lands withdrawn for military purposes. Such report shall include the following:

(1)

A description of the Military Geothermal Program, including any differences between it and the non-Military Geothermal Program, including required security procedures, and operational considerations, and discussions as to the differences, and why they are important. Further, the report shall describe revenues or energy provided to the Department of Defense and its facilities, royalty structures, where applicable, and any revenue sharing with States and counties or other benefits between—

(A)

the implementation of the Geothermal Steam Act of 1970 (30 U.S.C 1001 et seq.) and other applicable Federal law by the Secretary of the Interior; and

(B)

the administration of geothermal leasing under section 2689 of title 10, United States Code, by the Secretary of Defense.

(2)

If appropriate, a description of the current methods and procedures used to ensure interagency coordination, where needed, in developing renewable energy sources on Federal lands withdrawn for military purposes, and an identification of any new procedures that might be required in the future for the improvement of interagency coordination to ensure efficient processing and administration of leases or contracts for geothermal energy on Federal lands withdrawn for military purposes, consistent with the defense purposes of such withdrawals.

(3)

Recommendations for any legislative or administrative actions that might better achieve increased geothermal production, including a common royalty structure, leasing procedures, or other changes that increase production, offset military operation costs, or enhance the Federal agencies’ ability to develop geothermal resources.

Except as provided in this section, nothing in this subtitle shall affect the legal status of the Department of the Interior and the Department of the Defense with respect to each other regarding geothermal leasing and development until such status is changed by law.
227.

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, 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:

1.

Short title

This

.

(5)

Section 2 (30 U.S.C. 1001) is amended by striking Sec. 2. As and inserting the following:

2.

Definitions

As

.

(6)

Section 3 (30 U.S.C. 1002) is amended by striking Sec. 3. Subject and inserting the following:

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:

5.

Rents and royalties

.

(8)

Section 7 (30 U.S.C. 1006) is amended by striking Sec. 7. A geothermal and inserting the following:

7.

Acreage of Geothermal lease

A geothermal

.

(9)

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

8.

Readjustment of lease terms and conditions

(a)

The

.

(10)

Section 9 (30 U.S.C. 1008) is amended by striking Sec. 9. If and inserting the following:

9.

Byproducts

If

.

(11)

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

10.

Relinquishment of Geothermal rights

The

.

(12)

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

11.

Suspension of operations and production

The

.

(13)

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

12.

Termination of leases

Leases

.

(14)

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

13.

Waiver, suspension, or reduction of rental or royalty

The

.

(15)

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

14.

Surface land use

Subject

.

(16)

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

15.

Lands subject to Geothermal leasing

(a)

Geothermal

.

(17)

Section 16 (30 U.S.C. 1015) is amended by striking Sec. 16. Leases and inserting the following:

16.

Requirement for lessees

Leases

.

(18)

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

17.

Administration

Administration

.

(19)

Section 19 (30 U.S.C. 1018) is amended by striking Sec. 19. Upon and inserting the following:

19.

Data from Federal agencies

Upon

.

(20)

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:

21.

Publication in Federal register; reservation of mineral rights

.

(21)

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

22.

Federal exemption from State water laws

Nothing

.

(22)

Section 23 (30 U.S.C. 1022) is amended by striking Sec. 23. (a) All and inserting the following:

23.

Prevention of waste; exclusivity

(a)

All

.

(23)

Section 24 (30 U.S.C. 1023) is amended by striking Sec. 24. The and inserting the following:

24.

Rules and regulations

The

.

(24)

Section 25 (30 U.S.C. 1024) is amended by striking Sec. 25. As and inserting the following:

25.

Inclusion of Geothermal leasing under certain other laws

As

.

(25)

Section 26 is amended by striking Sec. 26. The and inserting the following:

26.

Amendment

The

.

(26)

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

27.

Federal reservation of certain mineral rights

The

.

(27)

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

28.

Significant thermal features

(a)
(1)

The

.

(28)

Section 29 (30 U.S.C. 1027) is amended by striking Sec. 29. The and inserting the following:

29.

Land subject to prohibition on leasing

The

.

C

Hydroelectric

I

Alternative conditions

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:

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 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.

.

II

Additional hydropower

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 2003 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 2003 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 2004 through 2013.

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 2004 through 2013.

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.

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 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.

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.

246.

Corps of Engineers hydropower operation and maintenance funding

(a)

In General

Notwithstanding the last sentence of section 5 of the Act of December 22, 1944 (commonly known as the Flood Control Act of 1944) (58 Stat. 890, chapter 665; 16 U.S.C. 825s), the 11th paragraph under the heading office of the secretary in title I of the Act of October 12, 1949 (63 Stat. 767, chapter 680; 16 U.S.C. 825s–1), the matter under the heading continuing fund, southeastern power administration in title I of the Act of August 31, 1951 (65 Stat. 249, chapter 375; 16 U.S.C. 825s–2), section 3302 of title 31, United States Code, or any other law, and without further appropriation or fiscal year limitation, for fiscal year 2004, the Administrator of the Southeastern Power Administration, the Administrator of the Southwestern Power Administration, and the Administrator of the Western Area Power Administration may credit to the Secretary of the Army (referred to in this section as the Secretary), receipts, in an amount determined under subsection (c), from the sale of power and related services.

(b)

Use of funds

(1)

In General

The Secretary—

(A)

shall, except as provided in paragraph (2), use the amounts credited under subsection (a) to fund only the Corps of Engineers annual operation and maintenance activities that are allocated exclusively to the power function and assigned to the respective power marketing administration and respective project system as applicable for repayment; and

(B)

shall not use the amounts for any costs allocated to non-power functions of Corps of Engineer operations.

(2)

Exception

The Secretary may use amounts credited by the Southwestern Power Administration under subsection (a) for capital and nonrecurring costs.

(c)

Amount

The amount of the receipts credited under subsection (a) shall be equal to such amount as—

(1)

the Secretary of the Army requests; and

(2)

the appropriate Administrator, in consultation with the power customers of the Administrator’s power marketing administration, determines to be appropriate to apply to the costs referred to in subsection (b).

(d)

Applicable law

The amounts credited under subsection (a) are exempt from sequestration under the Balanced Budget and Emergency Deficit Control Act of 1985 (2 U.S.C. 901 et seq.).

247.

Limitation on certain charges assessed to the flint creek project, Montana

Notwithstanding section 10(e)(1) of the Federal Power Act (16 U.S.C. 803(e)(1)) or any other provision of Federal law providing for the payment to the United States of charges for the use of Federal land for the purposes of operating and maintaining a hydroelectric development licensed by the Federal Energy Regulatory Commission (referred to in this section as the Commission), any political subdivision of the State of Montana that holds a license for Commission Project No. 1473 in Granite and Deer Lodge Counties, Montana, shall be required to pay to the United States for the use of that land for each year during which the political subdivision continues to hold the license for the project, the lesser of—

(1)

$25,000; or

(2)

such annual charge as the Commission or any other department or agency of the Federal Government may assess.

248.

Reinstatement and transfer

(a)

Reinstatement and transfer of Federal license for project numbered 2696

Notwithstanding section 8 of the Federal Power Act (16 U.S.C. 801) or any other provision of such Act, the Federal Energy Regulatory Commission shall reinstate the license for Project No. 2696 and transfer the license, without delay or the institution of any proceedings, to the Town of Stuyvesant, New York, holder of Federal Energy Regulatory Commission Preliminary Permit No. 11787, within 30 days after the date of enactment of this Act.

(b)

Hydroelectric incentives

Project No. 2696 shall be entitled to the full benefit of any Federal legislation that promotes hydroelectric development that is enacted within 2 years either before or after the date of enactment of this Act.

(c)

Project development and financing

The Federal Energy Regulatory Commission shall permit the Town of Stuyvesant to add as a colicensee any private or public entity or entities to the reinstated license at any time, notwithstanding the issuance of a preliminary permit to the Town of Stuyvesant and any consideration of municipal preference. The town shall be entitled, to the extent that funds are available or shall be made available, to receive loans under sections 402 and 403 of the Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 2702 and 2703), or similar programs, for the reimbursement of feasibility studies or development costs, or both, incurred since January 1, 2001, through and including December 31, 2006. All power produced by the project shall be deemed incremental hydropower for purpose of qualifying for any energy credit or similar benefits.

III

Oil and gas

A

Petroleum Reserve and home heating oil

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:

166.

Authorization of appropriations

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:

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).

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.

B

Production incentives

311.

Definition of Secretary

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

312.

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.

(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 transportation costs, salaries, and other administrative costs directly related to filling the Strategic Petroleum Reserve.

(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 2004 through 2013 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.

313.

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—

(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.

314.

Incentives for natural gas production from deep wells in the shallow waters of the Gulf of Mexico

(a)

Royalty incentive regulations

The Secretary shall publish a final regulation to complete the rulemaking begun by the Notice of Proposed Rulemaking entitled Relief or Reduction in Royalty Rates—Deep Gas Provisions, published in the Federal Register on March 26, 2003 (Federal Register, volume 68, number 58, 14868-14886).

(b)

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, in accordance with the regulations published pursuant to subsection (a), 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 before January 1, 2001, in shallow waters less than 200 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.

315.

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; and

(3)

12,000,000 barrels of oil equivalent for each lease in water depths greater than 1,600 meters.

(b)

Limitation

The Secretary may place limitations on the suspension of royalty relief granted based on market price.

316.

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.

317.

Oil and gas leasing in the National Petroleum Reserve in Alaska

(a)

Transfer of authority

(1)

Redesignation

The Naval Petroleum Reserves Production Act of 1976 (42 U.S.C. 6501 et seq.) is amended by redesignating section 107 (42 U.S.C. 6507) as section 108.

(2)

Transfer

The matter under the heading exploration of national petroleum reserve in alaska under the heading ENERGY AND MINERALS of title I of Public Law 96–514 (42 U.S.C. 6508) is—

(A)

transferred to the Naval Petroleum Reserves Production Act of 1976 (42 U.S.C. 6501 et seq.);

(B)

redesignated as section 107 of that Act; and

(C)

moved so as to appear after section 106 of that Act (42 U.S.C. 6506).

(b)

Competitive leasing

Section 107 of the Naval Petroleum Reserves Production Act of 1976 (as amended by subsection (a) of this section) is amended—

(1)

by striking the heading and all that follows through Provided, That (1) activities and inserting the following:

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 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 2003; 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 2003; 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.

.

318.

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—

(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 2005 through 2009.

(2)

Use

Of the amounts authorized under paragraph (1), $5,000,000 are authorized for each fiscal year for activities under subsection (f).

319.

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.

320.

Liquified natural gas

Section 3 of the Natural Gas Act (15 U.S.C. 717b) is amended by adding at the end the following:

(d)

Limitation on Commission authority

If an applicant under this section proposes to construct or expand a liquified natural gas terminal either onshore or in State waters for the purpose of importing liquified natural gas into the United States, the Commission shall not deny or condition the application solely on the basis that the applicant proposes to utilize the terminal exclusively or partially for gas that the applicant or any affiliate thereof will supply thereto. In all other respects, subsection (a) shall remain applicable to any such proposal.

.

321.

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.), or 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.

(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 2003, 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.

(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.
322.

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 2004.

(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 2004 through 2008.

323.

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,.

324.

Assessment of dependence of State of Hawaii on oil

(a)

Assessment

The Secretary of Energy shall assess the economic implication of the dependence of the State of Hawaii on oil as the principal source of energy for the State, including—

(1)

the short- and long-term prospects for crude oil supply disruption and price volatility and potential impacts on the economy of Hawaii;

(2)

the economic relationship between oil-fired generation of electricity from residual fuel and refined petroleum products consumed for ground, marine, and air transportation;

(3)

the technical and economic feasibility of increasing the contribution of renewable energy resources for generation of electricity, on an island-by-island basis, including—

(A)

siting and facility configuration;

(B)

environmental, operational, and safety considerations;

(C)

the availability of technology;

(D)

effects on the utility system including reliability;

(E)

infrastructure and transport requirements;

(F)

community support; and

(G)

other factors affecting the economic impact of such an increase and any effect on the economic relationship described in paragraph (2);

(4)

the technical and economic feasibility of using liquified natural gas to displace residual fuel oil for electric generation, including neighbor island opportunities, and the effect of the displacement on the economic relationship described in paragraph (2), including—

(A)

the availability of supply;

(B)

siting and facility configuration for onshore and offshore liquified natural gas receiving terminals;

(C)

the factors described in subparagraphs (B) through (F) of paragraph (3); and

(D)

other economic factors;

(5)

the technical and economic feasibility of using renewable energy sources (including hydrogen) for ground, marine, and air transportation energy applications to displace the use of refined petroleum products, on an island-by-island basis, and the economic impact of the displacement on the relationship described in (2); and

(6)

an island-by-island approach to—

(A)

the development of hydrogen from renewable resources; and

(B)

the application of hydrogen to the energy needs of Hawaii

(b)

Contracting authority

The Secretary of Energy may carry out the assessment under subsection (a) directly or, in whole or in part, through 1 or more contracts with qualified public or private entities.

(c)

Report

Not later than 300 days after the date of enactment of this Act, the Secretary of Energy shall prepare, in consultation with agencies of the State of Hawaii and other stakeholders, as appropriate, and submit to Congress, a report detailing the findings, conclusions, and recommendations resulting from the assessment.

(d)

Authorization of appropriations

There are authorized to be appropriated such sums as are necessary to carry out this section.

325.

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:

319.

Appeals to the Secretary

(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 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.

326.

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:

38.

Reimbursement for costs of certain analyses, documentation, and studies

(a)

In General

The Secretary of the Interior may 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.

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.

.

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 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.

.

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;

.

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.

331.

Bilateral international oil supply agreements

(a)

In General

Notwithstanding any other provision of law, the President may export oil to, or secure oil for, any country pursuant to a bilateral international oil supply agreement entered into by the United States with the country before June 25, 1979, or to any country pursuant to the International Emergency Oil Sharing Plan of the International Energy Agency.

(b)

Memorandum of Agreement

The following agreements are deemed to have entered into force by operation of law and are deemed to have no termination date:

(1)

The agreement entitled Agreement amending and extending the memorandum of agreement of June 22, 1979, entered into force November 13, 1994 (TIAS 12580).

(2)

The agreement entitled Agreement amending the contingency implementing arrangements of October 17, 1980, entered into force June 27, 1995 (TIAS 12670).

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:

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.

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:

24.

Natural gas market transparency

(a)

Authorization

(1)

Not later than 180 days after the date of enactment of the Energy Policy Act of 2003, 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.

.

C

Access to Federal land

341.

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.

342.

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.

343.

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 342.

(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 2004 through 2007—

(1)

$40,000,000 to carry out subsections (a) and (b); and

(2)

$20,000,000 to carry out subsection (c).

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.

345.

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.

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.

347.

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.

348.

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.

.

349.

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).

(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)).

350.

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 and gas pipelines and electric transmission and distribution facilities on Federal land; and

(ii)

opportunities for additional oil and gas 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 and gas 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 and gas 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 and gas 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 and gas 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

After completing the requirements under paragraphs (1) and (2), 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 and gas pipelines and electricity transmission and distribution facilities on Federal land are promptly identified and designated; and

(B)

expedite applications to construct or modify oil and gas 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.

351.

Consultation regarding energy rights-of-way on public land

(a)

Memorandum of understanding

(1)

In General

Not later than 6 months after the date of enactment of this Act, the Secretary of Energy, in consultation with the Secretary of the Interior, the Secretary of Agriculture, and the Secretary of Defense with respect to lands under their respective jurisdictions, shall enter into a memorandum of understanding to coordinate all applicable Federal authorizations and environmental reviews relating to a proposed or existing utility facility. To the maximum extent practicable under applicable law, the Secretary of Energy shall, to ensure timely review and permit decisions, coordinate such authorizations and reviews with any Indian tribes, multi-State entities, and State agencies that are responsible for conducting any separate permitting and environmental reviews of the affected utility facility.

(2)

Contents

The memorandum of understanding shall include provisions that—

(A)

establish—

(i)

a unified right-of-way application form; and

(ii)

an administrative procedure for processing right-of-way applications, including lines of authority, steps in application processing, and timeframes for application processing;

(B)

provide for coordination of planning relating to the granting of the rights-of-way;

(C)

provide for an agreement among the affected Federal agencies to prepare a single environmental review document to be used as the basis for all Federal authorization decisions; and

(D)

provide for coordination of use of right-of-way stipulations to achieve consistency.

(b)

Natural gas pipelines

(1)

In General

With respect to permitting activities for interstate natural gas pipelines, the May 2002 document entitled Interagency Agreement On Early Coordination Of Required Environmental And Historic Preservation Reviews Conducted In Conjunction With The Issuance Of Authorizations To Construct And Operate Interstate Natural Gas Pipelines Certificated By The Federal Energy Regulatory Commission shall constitute compliance with subsection (a).

(2)

Report

(A)

In General

Not later than 1 year after the date of enactment of this Act, and every 2 years thereafter, agencies that are signatories to the document referred to in paragraph (1) shall transmit to Congress a report on how the agencies under the jurisdiction of the Secretaries are incorporating and implementing the provisions of the document referred to in paragraph (1).

(B)

Contents

The report shall address—

(i)

efforts to implement the provisions of the document referred to in paragraph (1);

(ii)

whether the efforts have had a streamlining effect;

(iii)

further improvements to the permitting process of the agency; and

(iv)

recommendations for inclusion of State and tribal governments in a coordinated permitting process.

(c)

Definition of utility facility

In this section, the term utility facility means any privately, publicly, or cooperatively owned line, facility, or system—

(1)

for the transportation of—

(A)

oil, natural gas, synthetic liquid fuel, or gaseous fuel;

(B)

any refined product produced from oil, natural gas, synthetic liquid fuel, or gaseous fuel; or

(C)

products in support of the production of material referred to in subparagraph (A) or (B);

(2)

for storage and terminal facilities in connection with the production of material referred to in paragraph (1); or

(3)

for the generation, transmission, and distribution of electric energy.

352.

Renewable energy on Federal land

(a)

Report

(1)

In General

Not later than 24 months after the date of enactment of this Act, the Secretary of the Interior, in cooperation with the Secretary of Agriculture, shall develop and transmit to Congress a report that includes recommendations on opportunities to develop renewable energy on—

(A)

public lands under the jurisdiction of the Secretary of the Interior; and

(B)

National Forest System lands under the jurisdiction of the Secretary of Agriculture.

(2)

Contents

The report shall include—

(A)

5-year plans developed by the Secretary of the Interior and the Secretary of Agriculture, respectively, for encouraging the development of renewable energy consistent with applicable law and management plans;

(B)

an analysis of—

(i)

the use of rights-of-way, leases, or other methods to develop renewable energy on such lands;

(ii)

the anticipated benefits of grants, loans, tax credits, or other provisions to promote renewable energy development on such lands; and

(iii)

any issues that the Secretary of the Interior or the Secretary of Agriculture have encountered in managing renewable energy projects on such lands, believe are likely to arise in relation to the development of renewable energy on such lands;

(C)

a list, developed in consultation with the Secretary of Energy and the Secretary of Defense, of lands under the jurisdiction of the Department of Energy or the Department of Defense that would be suitable for development for renewable energy, and any recommended statutory and regulatory mechanisms for such development; and

(D)

any recommendations relating to the issues addressed in the report.

(b)

National Academy of Sciences study

(1)

In General

Not later than 90 days after the date of enactment of this Act, the Secretary of the Interior shall contract with the National Academy of Sciences to—

(A)

study the potential for the development of wind, solar, and ocean energy (including tidal, wave, and thermal energy) on the outer Continental Shelf;

(B)

assess existing Federal authorities for the development of such resources; and

(C)

recommend statutory and regulatory mechanisms for such development.

(2)

Transmittal

The results of the study shall be transmitted to Congress not later than 2 years after the date of enactment of this Act.

(c)

Generation capacity of electricity from renewable energy resources on public land

The Secretary of the Interior shall, not later than 10 years after the date of enactment of this Act, seek to approve renewable energy projects located (or to be located) on public lands with a generation capacity of at least 10,000 megawatts of electricity.

353.

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 the 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.

354.

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.

355.

Encouraging prohibition of off-shore Drilling in the Great Lakes

Congress encourages—

(1)

the States of Illinois, Michigan, New York, Pennsylvania, and Wisconsin to continue to prohibit offshore drilling in the Great Lakes for oil and gas; and

(2)

the States of Indiana, Minnesota, and Ohio to enact a prohibition of such drilling.

356.

Finger Lakes National Forest withdrawal

All Federal land within the boundary of Finger Lakes National Forest in the State of New York is withdrawn from—

(1)

all forms of entry, appropriation, or disposal under the public land laws; and

(2)

disposition under all laws relating to oil and gas leasing.

357.

Study on lease exchanges in the rocky mountain front

(a)

Definitions

For the purposes of this section:

(1)

Badger-Two Medicine Area

The term Badger-Two Medicine Area means the Forest Service land located in—

(A)

T. 31 N., R. 12–13 W.;

(B)

T. 30 N., R. 11–13 W.;

(C)

T. 29 N., R. 10–16 W.; and

(D)

T. 28 N., R. 10–14 W.

(2)

Blackleaf Area

The term Blackleaf Area means the Federal land owned by the Forest Service and Bureau of Land Management that is located in—

(A)

T. 27 N., R. 9 W.;

(B)

T. 26 N., R. 9–10 W.;

(C)

T. 25 N., R. 8–10 W.; and

(D)

T. 24 N., R. 8–9 W.

(3)

Eligible lessee

The term eligible lessee means a lessee under a nonproducing lease.

(4)

Nonproducing lease

The term nonproducing lease means a Federal oil or gas lease—

(A)

that is in existence and in good standing on the date of enactment of this Act; and

(B)

that is located in the Badger-Two Medicine Area or the Blackleaf Area.

(5)

Secretary

The term Secretary means the Secretary of the Interior.

(6)

State

The term State means the State of Montana.

(b)

Evaluation

(1)

In General

The Secretary, in consultation with the Governor of the State, and the eligible lessees, shall evaluate opportunities for domestic oil and gas production through the exchange of the nonproducing leases.

(2)

Requirements

In carrying out the evaluation under subsection (a), the Secretary shall—

(A)

consider opportunities for domestic production of oil and gas through—

(i)

the exchange of the nonproducing leases for oil and gas lease tracts of comparable value in the State; and

(ii)

the issuance of bidding, royalty, or rental credits for Federal oil and gas leases in the State in exchange for the cancellation of the nonproducing leases;

(B)

consider any other appropriate means to exchange, or provide compensation for the cancellation of, nonproducing leases, subject to the consent of the eligible lessees;

(C)

consider the views of any interested persons, including the State;

(D)

determine the level of interest of the eligible lessees in exchanging the nonproducing leases;

(E)

assess the economic impact on the lessees and the State of lease exchange, lease cancellation, and final judicial or administrative decisions related to the nonproducing leases; and

(F)

provide recommendations on—

(i)

whether to pursue an exchange of the nonproducing leases;

(ii)

any changes in laws (including regulations) that are necessary for the Secretary to carry out the exchange; and

(iii)

any other appropriate means to exchange or provide compensation for the cancellation of a nonproducing lease, subject to the consent of the eligible lessee.

(c)

Valuation of nonproducing leases

For the purpose of the evaluation under subsection (a), the value of a nonproducing lease shall be an amount equal to the difference between—

(1)

the sum of—

(A)

the amount paid by the eligible lessee for the nonproducing lease;

(B)

any direct expenditures made by the eligible lessee before the transmittal of the report in subsection (c) associated with the exploration and development of the nonproducing lease; and

(C)

interest on any amounts under subparagraphs (A) and (B) during the period beginning on the date on which the amount was paid and ending on the date on which credits are issued under subsection (b)(2)(A)(ii); and

(2)

the sum of the revenues from the nonproducing lease.

(d)

Report to Congress

Not later than 2 years after the date of the enactment of this Act, the Secretary shall initiate the evaluation in subsection (b) and transmit to Congress a report on the evaluation.

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).

359.

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).

D

Alaska Natural Gas Pipeline

371.

Short title

This subtitle may be cited as the Alaska Natural Gas Pipeline Act.

372.

Definitions

In this subtitle:

(1)

Alaska natural gas

The term Alaska natural gas means natural gas derived from the area of the State of Alaska lying north of 64 degrees north latitude.

(2)

Alaska natural gas transportation project

The term Alaska natural gas transportation project means any natural gas pipeline system that carries Alaska natural gas to the border between Alaska and Canada (including related facilities subject to the jurisdiction of the Commission) that is authorized under—

(A)

the Alaska Natural Gas Transportation Act of 1976 (15 U.S.C. 719 et seq.); or

(B)

section 373.

(3)

Alaska Natural Gas Transportation System

The term Alaska natural gas transportation system means the Alaska natural gas transportation project authorized under the Alaska Natural Gas Transportation Act of 1976 (15 U.S.C. 719 et seq.) and designated and described in section 2 of the President’s decision.

(4)

Commission

The term Commission means the Federal Energy Regulatory Commission.

(5)

Federal Coordinator

The term Federal Coordinator means the head of the Office of the Federal Coordinator for Alaska Natural Gas Transportation Projects established by section 376(a).

(6)

President’s decision

The term President’s decision means the decision and report to Congress on the Alaska natural gas transportation system—

(A)

issued by the President on September 22, 1977, in accordance with section 7 of the Alaska Natural Gas Transportation Act of 1976 (15 U.S.C. 719e); and

(B)

approved by Public Law 95–158 (15 U.S.C. 719f note; 91 Stat. 1268).

(7)

Secretary

The term Secretary means the Secretary of Energy.

(8)

State

The term State means the State of Alaska.

373.

Issuance of certificate of public convenience and necessity

(a)

Authority of the Commission

Notwithstanding the Alaska Natural Gas Transportation Act of 1976 (15 U.S.C. 719 et seq.), the Commission may, in accordance with section 7(c) of the Natural Gas Act (15 U.S.C. 717f(c)), consider and act on an application for the issuance of a certificate of public convenience and necessity authorizing the construction and operation of an Alaska natural gas transportation project other than the Alaska natural gas transportation system.

(b)

Issuance of certificate

(1)

In General

The Commission shall issue a certificate of public convenience and necessity authorizing the construction and operation of an Alaska natural gas transportation project under this section if the applicant has satisfied the requirements of section 7(e) of the Natural Gas Act (15 U.S.C. 717f(e)).

(2)

Considerations

In considering an application under this section, the Commission shall presume that—

(A)

a public need exists to construct and operate the proposed Alaska natural gas transportation project; and

(B)

sufficient downstream capacity will exist to transport the Alaska natural gas moving through the project to markets in the contiguous United States.

(c)

Expedited approval process

Not later than 60 days after the date of issuance of the final environmental impact statement under section 374 for an Alaska natural gas transportation project, the Commission shall issue a final order granting or denying any application for a certificate of public convenience and necessity for the project under section 7(c) of the Natural Gas Act (15 U.S.C. 717f(c)) and this section.

(d)

Prohibition of certain pipeline route

No license, permit, lease, right-of-way, authorization, or other approval required under Federal law for the construction of any pipeline to transport natural gas from land within the Prudhoe Bay oil and gas lease area may be granted for any pipeline that follows a route that—

(1)

traverses land beneath navigable waters (as defined in section 2 of the Submerged Lands Act (43 U.S.C. 1301)) beneath, or the adjacent shoreline of, the Beaufort Sea; and

(2)

enters Canada at any point north of 68 degrees north latitude.

(e)

Open season

(1)

In General

Not later than 120 days after the date of enactment of this Act, the Commission shall issue regulations governing the conduct of open seasons for Alaska natural gas transportation projects (including procedures for the allocation of capacity).

(2)

Regulations

The regulations referred to in paragraph (1) shall—

(A)

include the criteria for and timing of any open seasons;

(B)

promote competition in the exploration, development, and production of Alaska natural gas; and

(C)

for any open season for capacity exceeding the initial capacity, provide the opportunity for the transportation of natural gas other than from the Prudhoe Bay and Point Thomson units.

(3)

Applicability

Except in a case in which an expansion is ordered in accordance with section 375, initial or expansion capacity on any Alaska natural gas transportation project shall be allocated in accordance with procedures to be established by the Commission in regulations issued under paragraph (1).

(f)

Projects in the contiguous United States

(1)

In General

An application for additional or expanded pipeline facilities that may be required to transport Alaska natural gas from Canada to markets in the contiguous United States may be made in accordance with the Natural Gas Act (15 U.S.C. 717a et seq.).

(2)

Expansion

To the extent that a pipeline facility described in paragraph (1) includes the expansion of any facility constructed in accordance with the Alaska Natural Gas Transportation Act of 1976 (15 U.S.C. 719 et seq.), that Act shall continue to apply.

(g)

Study of in-state needs

The holder of the certificate of public convenience and necessity issued, modified, or amended by the Commission for an Alaska natural gas transportation project shall demonstrate that the holder has conducted a study of Alaska in-State needs, including tie-in points along the Alaska natural gas transportation project for in-State access.

(h)

Alaska royalty gas

(1)

In General

Except as provided in paragraph (2), the Commission, on a request by the State and after a hearing, may provide for reasonable access to the Alaska natural gas transportation project by the State (or State designee) for the transportation of royalty gas of the State for the purpose of meeting local consumption needs within the State.

(2)

Exception

The rates of shippers of subscribed capacity on an Alaska natural gas transportation project described in paragraph (1), as in effect as of the date on which access under that paragraph is granted, shall not be increased as a result of such access.

(i)

Regulations

The Commission may issue such regulations as are necessary to carry out this section.

374.

Environmental reviews

(a)

Compliance with NEPA

The issuance of a certificate of public convenience and necessity authorizing the construction and operation of any Alaska natural gas transportation project under section 373 shall be treated as a major Federal action significantly affecting the quality of the human environment within the meaning of section 102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)).

(b)

Designation of lead agency

(1)

In General

The Commission—

(A)

shall be the lead agency for purposes of complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.); and

(B)

shall be responsible for preparing the environmental impact statement required by section 102(2)(c) of that Act (42 U.S.C. 4332(2)(c)) with respect to an Alaska natural gas transportation project under section 373.

(2)

Consolidation of statements

In carrying out paragraph (1), the Commission shall prepare a single environmental impact statement, which shall consolidate the environmental reviews of all Federal agencies considering any aspect of the Alaska natural gas transportation project covered by the environmental impact statement.

(c)

Other agencies

(1)

In General

Each Federal agency considering an aspect of the construction and operation of an Alaska natural gas transportation project under section 373 shall—

(A)

cooperate with the Commission; and

(B)

comply with deadlines established by the Commission in the preparation of the environmental impact statement under this section.

(2)

Satisfaction of NEPA requirements

The environmental impact statement prepared under this section shall be adopted by each Federal agency described in paragraph (1) in satisfaction of the responsibilities of the Federal agency under section 102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)) with respect to the Alaska natural gas transportation project covered by the environmental impact statement.

(d)

Expedited process

The Commission shall—

(1)

not later than 1 year after the Commission determines that the application under section 373 with respect to an Alaska natural gas transportation project is complete, issue a draft environmental impact statement under this section; and

(2)

not later than 180 days after the date of issuance of the draft environmental impact statement, issue a final environmental impact statement, unless the Commission for good cause determines that additional time is needed.

375.

Pipeline expansion

(a)

Authority

With respect to any Alaska natural gas transportation project, on a request by 1 or more persons and after giving notice and an opportunity for a hearing, the Commission may order the expansion of the Alaska natural gas project if the Commission determines that such an expansion is required by the present and future public convenience and necessity.

(b)

Responsibilities of Commission

Before ordering an expansion under subsection (a), the Commission shall—

(1)

approve or establish rates for the expansion service that are designed to ensure the recovery, on an incremental or rolled-in basis, of the cost associated with the expansion (including a reasonable rate of return on investment);

(2)

ensure that the rates do not require existing shippers on the Alaska natural gas transportation project to subsidize expansion shippers;

(3)

find that a proposed shipper will comply with, and the proposed expansion and the expansion of service will be undertaken and implemented based on, terms and conditions consistent with the tariff of the Alaska natural gas transportation project in effect as of the date of the expansion;

(4)

find that the proposed facilities will not adversely affect the financial or economic viability of the Alaska natural gas transportation project;

(5)

find that the proposed facilities will not adversely affect the overall operations of the Alaska natural gas transportation project;

(6)

find that the proposed facilities will not diminish the contract rights of existing shippers to previously subscribed certificated capacity;

(7)

ensure that all necessary environmental reviews have been completed; and

(8)

find that adequate downstream facilities exist or are expected to exist to deliver incremental Alaska natural gas to market.

(c)

Requirement for a firm transportation Agreement

Any order of the Commission issued in accordance with this section shall be void unless the person requesting the order executes a firm transportation agreement with the Alaska natural gas transportation project within such reasonable period of time as the order may specify.

(d)

Limitation

Nothing in this section expands or otherwise affects any authority of the Commission with respect to any natural gas pipeline located outside the State.

(e)

Regulations

The Commission may issue such regulations as are necessary to carry out this section.

376.

Federal Coordinator

(a)

Establishment

There is established, as an independent office in the executive branch, the Office of the Federal Coordinator for Alaska Natural Gas Transportation Projects.

(b)

Federal Coordinator

(1)

Appointment

The Office shall be headed by a Federal Coordinator for Alaska Natural Gas Transportation Projects, who shall be appointed by the President, by and with the advice and consent of the Senate, to serve a term to last until 1 year following the completion of the project referred to in section 373.

(2)

Compensation

The Federal Coordinator shall be compensated at the rate prescribed for level III of the Executive Schedule (5 U.S.C. 5314).

(c)

Duties

The Federal Coordinator shall be responsible for—

(1)

coordinating the expeditious discharge of all activities by Federal agencies with respect to an Alaska natural gas transportation project; and

(2)

ensuring the compliance of Federal agencies with the provisions of this subtitle.

(d)

Reviews and actions of other Federal agencies

(1)

Expedited reviews and actions

All reviews conducted and actions taken by any Federal agency relating to an Alaska natural gas transportation project authorized under this section shall be expedited, in a manner consistent with completion of the necessary reviews and approvals by the deadlines under this subtitle.

(2)

Prohibition of certain terms and conditions

No Federal agency may include in any certificate, right-of-way, permit, lease, or other authorization issued to an Alaska natural gas transportation project any term or condition that may be permitted, but is not required, by any applicable law if the Federal Coordinator determines that the term or condition would prevent or impair in any significant respect the expeditious construction and operation, or an expansion, of the Alaska natural gas transportation project.

(3)

Prohibition of certain actions

Unless required by law, no Federal agency shall add to, amend, or abrogate any certificate, right-of-way, permit, lease, or other authorization issued to an Alaska natural gas transportation project if the Federal Coordinator determines that the action would prevent or impair in any significant respect the expeditious construction and operation, or an expansion, of the Alaska natural gas transportation project.

(4)

Limitation

The Federal Coordinator shall not have authority to—

(A)

override—

(i)

the implementation or enforcement of regulations issued by the Commission under section 373; or

(ii)

an order by the Commission to expand the project under section 375; or

(B)

impose any terms, conditions, or requirements in addition to those imposed by the Commission or any agency with respect to construction and operation, or an expansion of, the project.

(e)

State coordination

(1)

In General

The Federal Coordinator and the State shall enter into a joint surveillance and monitoring agreement similar to the agreement in effect during construction of the Trans-Alaska Pipeline, to be approved by the President and the Governor of the State, for the purpose of monitoring the construction of the Alaska natural gas transportation project.

(2)

Primary responsibility

With respect to an Alaska natural gas transportation project—

(A)

the Federal Government shall have primary surveillance and monitoring responsibility in areas where the Alaska natural gas transportation project crosses Federal land or private land; and

(B)

the State government shall have primary surveillance and monitoring responsibility in areas where the Alaska natural gas transportation project crosses State land.

(f)

Transfer of Federal inspector functions and authority

On appointment of the Federal Coordinator by the President, all of the functions and authority of the Office of Federal Inspector of Construction for the Alaska Natural Gas Transportation System vested in the Secretary under section 3012(b) of the Energy Policy Act of 1992 (15 U.S.C. 719e note; Public Law 102–486), including all functions and authority described and enumerated in the Reorganization Plan No. 1 of 1979 (44 Fed. Reg. 33663), Executive Order No. 12142 of June 21, 1979 (44 Fed. Reg. 36927), and section 5 of the President’s decision, shall be transferred to the Federal Coordinator.

(g)

Temporary authority

The functions, authorities, duties, and responsibilities of the Federal Coordinator shall be vested in the Secretary until the later of the appointment of the Federal Coordinator by the President, or 18 months after the date of enactment of this Act.

377.

Judicial review

(a)

Exclusive jurisdiction

Except for review by the Supreme Court on writ of certiorari, the United States Court of Appeals for the District of Columbia Circuit shall have original and exclusive jurisdiction to determine—

(1)

the validity of any final order or action (including a failure to act) of any Federal agency or officer under this subtitle;

(2)

the constitutionality of any provision of this subtitle, or any decision made or action taken under this subtitle; or

(3)

the adequacy of any environmental impact statement prepared under the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) with respect to any action under this subtitle.

(b)

Deadline for filing claim

A claim arising under this subtitle may be brought not later than 60 days after the date of the decision or action giving rise to the claim.

(c)

Expedited consideration

The United States Court of Appeals for the District of Columbia Circuit shall set any action brought under subsection (a) for expedited consideration, taking into account the national interest of enhancing national energy security by providing access to the significant gas reserves in Alaska needed to meet the anticipated demand for natural gas.

(d)

Amendment of the Alaska Natural Gas Transportation Act of 1976

Section 10(c) of the Alaska Natural Gas Transportation Act of 1976 (15 U.S.C. 719h) is amended—

(1)

by striking (c)(1) A claim and inserting the following:

(c)

Jurisdiction

(1)

Special courts

(A)

In General

A claim

;

(2)

by striking Such court shall have and inserting the following:

(B)

Exclusive jurisdiction

The Special Court shall have

;

(3)

by inserting after paragraph (1) the following:

(2)

Expedited consideration

The Special Court shall set any action brought under this section for expedited consideration, taking into account the national interest described in section 2.

; and

(4)

in paragraph (3), by striking (3) The enactment and inserting the following:

(3)

Environmental impact statements

The enactment

.

378.

State jurisdiction over in-State delivery of natural gas

(a)

Local distribution

Any facility receiving natural gas from an Alaska natural gas transportation project for delivery to consumers within the State—

(1)

shall be deemed to be a local distribution facility within the meaning of section 1(b) of the Natural Gas Act (15 U.S.C. 717(b)); and

(2)

shall not be subject to the jurisdiction of the Commission.

(b)

Additional pipelines

Except as provided in section 373(d), nothing in this subtitle shall preclude or otherwise affect a future natural gas pipeline that may be constructed to deliver natural gas to Fairbanks, Anchorage, Matanuska-Susitna Valley, or the Kenai peninsula or Valdez or any other site in the State for consumption within or distribution outside the State.

(c)

Rate coordination

(1)

In General

In accordance with the Natural Gas Act (15 U.S.C. 717a et seq.), the Commission shall establish rates for the transportation of natural gas on any Alaska natural gas transportation project.

(2)

Consultation

In carrying out paragraph (1), the Commission, in accordance with section 17(b) of the Natural Gas Act (15 U.S.C. 717p(b)), shall consult with the State regarding rates (including rate settlements) applicable to natural gas transported on and delivered from the Alaska natural gas transportation project for use within the State.

379.

Study of alternative means of construction

(a)

Requirement of study

If no application for the issuance of a certificate or amended certificate of public convenience and necessity authorizing the construction and operation of an Alaska natural gas transportation project has been filed with the Commission by the date that is 18 months after the date of enactment of this Act, the Secretary shall conduct a study of alternative approaches to the construction and operation of such an Alaska natural gas transportation project.

(b)

Scope of study

The study under subsection (a) shall take into consideration the feasibility of—

(1)

establishing a Federal Government corporation to construct an Alaska natural gas transportation project; and

(2)

securing alternative means of providing Federal financing and ownership (including alternative combinations of Government and private corporate ownership) of the Alaska natural gas transportation project.

(c)

Consultation

In conducting the study under subsection (a), the Secretary shall consult with the Secretary of the Treasury and the Secretary of the Army (acting through the Chief of Engineers).

(d)

Report

On completion of any study under subsection (a), the Secretary shall submit to Congress a report that describes—

(1)

the results of the study; and

(2)

any recommendations of the Secretary (including proposals for legislation to implement the recommendations).

380.

Clarification of angta status and authorities

(a)

Savings clause

Nothing in this subtitle affects—

(1)

any decision, certificate, permit, right-of-way, lease, or other authorization issued under section 9 of the Alaska Natural Gas Transportation Act of 1976 (15 U.S.C. 719g); or

(2)

any Presidential finding or waiver issued in accordance with that Act.

(b)

Clarification of authority to amend terms and conditions to meet current project requirements

Any Federal agency responsible for granting or issuing any certificate, permit, right-of-way, lease, or other authorization under section 9 of the Alaska Natural Gas Transportation Act of 1976 (15 U.S.C. 719g) may add to, amend, or rescind any term or condition included in the certificate, permit, right-of-way, lease, or other authorization to meet current project requirements (including the physical design, facilities, and tariff specifications), if the addition, amendment, or rescission—

(1)

would not compel any change in the basic nature and general route of the Alaska natural gas transportation system as designated and described in section 2 of the President’s decision; or

(2)

would not otherwise prevent or impair in any significant respect the expeditious construction and initial operation of the Alaska natural gas transportation system.

(c)

Updated environmental reviews

The Secretary shall require the sponsor of the Alaska natural gas transportation system to submit such updated environmental data, reports, permits, and impact analyses as the Secretary determines are necessary to develop detailed terms, conditions, and compliance plans required by section 5 of the President’s decision.

381.

Sense of Congress concerning use of steel manufactured in North America negotiation of a project labor Agreement

It is the sense of Congress that—

(1)

an Alaska natural gas transportation project would provide significant economic benefits to the United States and Canada; and

(2)

to maximize those benefits, the sponsors of the Alaska natural gas transportation project should make every effort to—

(A)

use steel that is manufactured in North America; and

(B)

negotiate a project labor agreement to expedite construction of the pipeline.

382.

Sense of Congress and study concerning participation by small business concerns

(a)

Definition of small business concern

In this section, the term small business concern has the meaning given the term in section 3(a) of the Small Business Act (15 U.S.C. 632(a)).

(b)

Sense of Congress

It is the sense of Congress that—

(1)

an Alaska natural gas transportation project would provide significant economic benefits to the United States and Canada; and

(2)

to maximize those benefits, the sponsors of the Alaska natural gas transportation project should maximize the participation of small business concerns in contracts and subcontracts awarded in carrying out the project.

(c)

Study

(1)

In General

The Comptroller General of the United States shall conduct a study to determine the extent to which small business concerns participate in the construction of oil and gas pipelines in the United States.

(2)

Report

Not later that 1 year after the date of enactment of this Act, the Comptroller General shall submit to Congress a report that describes results of the study under paragraph (1).

(3)

Updates

The Comptroller General shall—

(A)

update the study at least once every 5 years until construction of an Alaska natural gas transportation project is completed; and

(B)

on completion of each update, submit to Congress a report containing the results of the update.

383.

Alaska pipeline construction training Program

(a)

Program

(1)

Establishment

The Secretary of Labor (in this section referred to as the Secretary) shall make grants to the Alaska Workforce Investment Board—

(A)

to recruit and train adult and dislocated workers in Alaska, including Alaska Natives, in the skills required to construct and operate an Alaska gas pipeline system; and

(B)

for the design and construction of a training facility to be located in Fairbanks, Alaska, to support an Alaska gas pipeline training program.

(2)

Coordination with existing programs

The training program established with the grants authorized under paragraph (1) shall be consistent with the vision and goals set forth in the State of Alaska Unified Plan, as developed pursuant to the Workforce Investment Act of 1998 (29 U.S.C. 2801 et seq.).

(b)

Requirements for grants

The Secretary shall make a grant under subsection (a) only if—

(1)

the Governor of the State of Alaska requests the grant funds and certifies in writing to the Secretary that there is a reasonable expectation that the construction of the Alaska natural gas pipeline system will commence by the date that is 2 years after the date of the certification; and

(2)

the Secretary of Energy concurs in writing to the Secretary with the certification made under paragraph (1) after considering—

(A)

the status of necessary Federal and State permits;

(B)

the availability of financing for the Alaska natural gas pipeline project; and

(C)

other relevant factors.

(c)

Authorization of appropriations

There are authorized to be appropriated to the Secretary to carry out this section $20,000,000. Not more than 15 percent of the funds may be used for the facility described in subsection (a)(1)(B).

384.

Sense of Congress concerning natural gas demand

It is the sense of Congress that—

(1)

North American demand for natural gas will increase dramatically over the course of the next several decades;

(2)

both the Alaska Natural Gas Pipeline and the Mackenzie Delta Natural Gas project in Canada will be necessary to help meet the increased demand for natural gas in North America;

(3)

Federal and State officials should work together with officials in Canada to ensure both projects can move forward in a mutually beneficial fashion;

(4)

Federal and State officials should acknowledge that the smaller scope, fewer permitting requirements, and lower cost of the Mackenzie Delta project means it will most likely be completed before the Alaska Natural Gas Pipeline;

(5)

natural gas production in the 48 contiguous States and Canada will not be able to meet all domestic demand in the coming decades; and

(6)

as a result, natural gas delivered from Alaskan North Slope will not displace or reduce the commercial viability of Canadian natural gas produced from the Mackenzie Delta or production from the 48 contiguous States.

385.

Sense of Congress concerning Alaskan ownership

It is the sense of Congress that—

(1)

Alaska Native Regional Corporations, companies owned and operated by Alaskans, and individual Alaskans should have the opportunity to own shares of the Alaska natural gas pipeline in a way that promotes economic development for the State; and

(2)

to facilitate economic development in the State, all project sponsors should negotiate in good faith with any willing Alaskan person that desires to be involved in the project.

386.

Loan guarantees

(a)

Authority

(1)

The Secretary may enter into agreements with 1 or more holders of a certificate of public convenience and necessity issued under section 373(b) of this Act or section 9 of the Alaska Natural Gas Transportation Act of 1976 (15 U.S.C. 719g) to issue Federal guarantee instruments with respect to loans and other debt obligations for a qualified infrastructure project.

(2)

Subject to the requirements of this section, the Secretary may also enter into agreements with 1 or more owners of the Canadian portion of a qualified infrastructure project to issue Federal guarantee instruments with respect to loans and other debt obligations for a qualified infrastructure project as though such owner were a holder described in paragraph (1).

(3)

The authority of the Secretary to issue Federal guarantee instruments under this section for a qualified infrastructure project shall expire on the date that is 2 years after the date on which the final certificate of public convenience and necessity (including any Canadian certificates of public convenience and necessity) is issued for the project. A final certificate shall be considered to have been issued when all certificates of public convenience and necessity have been issued that are required for the initial transportation of commercially economic quantities of natural gas from Alaska to the continental United States.

(b)

Conditions

(1)

The Secretary may issue a Federal guarantee instrument for a qualified infrastructure project only after a certificate of public convenience and necessity under section 373(b) of this Act or an amended certificate under section 9 of the Alaska Natural Gas Transportation Act of 1976 (15 U.S.C. 719g) has been issued for the project.

(2)

The Secretary may issue a Federal guarantee instrument under this section for a qualified infrastructure project only if the loan or other debt obligation guaranteed by the instrument has been issued by an eligible lender.

(3)

The Secretary shall not require as a condition of issuing a Federal guarantee instrument under this section any contractual commitment or other form of credit support of the sponsors (other than equity contribution commitments and completion guarantees), or any throughput or other guarantee from prospective shippers greater than such guarantees as shall be required by the project owners.

(c)

Limitations on amounts

(1)

The amount of loans and other debt obligations guaranteed under this section for a qualified infrastructure project shall not exceed 80 percent of the total capital costs of the project, including interest during construction.

(2)

The principal amount of loans and other debt obligations guaranteed under this section shall not exceed, in the aggregate, $18,000,000,000, which amount shall be indexed for United States dollar inflation from the date of enactment of this Act, as measured by the Consumer Price Index.

(d)

Loan terms and fees

(1)

The Secretary may issue Federal guarantee instruments under this section that take into account repayment profiles and grace periods justified by project cash flows and project-specific considerations. The term of any loan guaranteed under this section shall not exceed 30 years.

(2)

An eligible lender may assess and collect from the borrower such other fees and costs associated with the application and origination of the loan or other debt obligation as are reasonable and customary for a project finance transaction in the oil and gas sector.

(e)

Regulations

The Secretary may issue regulations to carry out this section.

(f)

Authorization of appropriations

There are authorized to be appropriated such sums as may be necessary to cover the cost of loan guarantees under this section, as defined by section 502(5) of the Federal Credit Reform Act of 1990 (2 U.S.C. 661a(5)). Such sums shall remain available until expended.

(g)

Definitions

In this section, the following definitions apply:

(1)

The term Consumer Price Index means the Consumer Price Index for all-urban consumers, United States city average, as published by the Bureau of Labor Statistics, or if such index shall cease to be published, any successor index or reasonable substitute thereof.

(2)

The term eligible lender means any non-Federal qualified institutional buyer (as defined by section 230.144A(a) of title 17, Code of Federal Regulations (or any successor regulation), known as Rule 144A(a) of the Securities and Exchange Commission and issued under the Securities Act of 1933), including—

(A)

a qualified retirement plan (as defined in section 4974(c) of the Internal Revenue Code of 1986 (26 U.S.C. 4974(c)) that is a qualified institutional buyer; and

(B)

a governmental plan (as defined in section 414(d) of the Internal Revenue Code of 1986 (26 U.S.C. 414(d)) that is a qualified institutional buyer.

(3)

The term Federal guarantee instrument means any guarantee or other pledge by the Secretary to pledge the full faith and credit of the United States to pay all of the principal and interest on any loan or other debt obligation entered into by a holder of a certificate of public convenience and necessity.

(4)

The term qualified infrastructure project means an Alaskan natural gas transportation project consisting of the design, engineering, finance, construction, and completion of pipelines and related transportation and production systems (including gas treatment plants), and appurtenances thereto, that are used to transport natural gas from the Alaska North Slope to the continental United States.

IV

Coal

A

Clean Coal Power Initiative

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 2004 through 2012, to remain available until expended.

(b)

Report

The Secretary shall submit to Congress the report required by this subsection not later than March 31, 2005. 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.

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.

(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;

(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.

403.

Report

Not later than 1 year after the date of enactment of this Act, and once every 2 years thereafter through 2012, 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.

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.

B

Clean Power Projects

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.

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.

413.

Integrated gasification combined cycle technology

The Secretary is authorized to provide loan guarantees for a project to produce energy from a plant using integrated gasification combined cycle technology located in a taconite-producing region of the United States that is entitled under the law of the State in which the plant is located to enter into a long-term contract approved by a State Public Utility Commission to sell at least 450 megawatts of output to a utility.

414.

Petroleum coke gasification

The Secretary is authorized to provide loan guarantees for at least 1 petroleum coke gasification polygeneration project.

415.

Integrated coal/renewable energy system

The Secretary is authorized, subject to the availability of appropriations, to provide loan guarantees for a project to produce energy from coal of less than 7000 btu/lb using appropriate advanced integrated gasification combined cycle technology, including repowering of existing facilities, that is combined with wind and other renewable sources, minimizes and offers the potential to sequester carbon dioxide emissions, and provides a ready source of hydrogen for near-site fuel cell demonstrations. The facility may be built in stages, combined output shall be at least 200 megawatts at successively more competitive rates, and the facility shall be located in the Upper Great Plains. Section 402(b) technical criteria apply, and the Federal cost share shall not exceed 50 percent. The loan guarantees provided under this section do not preclude the facility from receiving an allocation for investment tax credits under section 48A of the Internal Revenue Code of 1986. Utilizing this investment tax credit does not prohibit the use of other Clean Coal Program funding.

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.

C

Federal Coal Leases

421.

Repeal of the 160-acre limitation for coal leases

Section 3 of the Mineral Leasing Act (30 U.S.C. 203) is amended—

(1)

in the first sentence—

(A)

by striking Any person and inserting (a) Any person;

(B)

by inserting a comma after may; and

(C)

by striking upon and all that follows through the period and inserting the following:

upon a finding by the Secretary that the lease—

(1)

would be in the interest of the United States;

(2)

would not displace a competitive interest in the land; and

(3)

would not include land or deposits that can be developed as part of another potential or existing operation;

secure modifications of the original coal lease by including additional coal land or coal deposits contiguous or cornering to those embraced in the lease, but in no event shall the total area added by any modifications to an existing coal lease exceed 1280 acres, or add acreage larger than the acreage in the original lease.

;

(2)

in the second sentence, by striking The Secretary and inserting the following:

(b)

The Secretary

; and

(3)

in the third sentence, by striking The minimum and inserting the following:

(c)

The minimum

.

422.

Mining plans

Section 2(d)(2) of the Mineral Leasing Act (30 U.S.C. 202a(2)) is amended—

(1)

by inserting (A) after (2); and

(2)

by adding at the end the following:

(B)

The Secretary may establish a period of more than 40 years if the Secretary determines that the longer period—

(i)

will ensure the maximum economic recovery of a coal deposit; or

(ii)

the longer period is in the interest of the orderly, efficient, or economic development of a coal resource.

.

423.

Payment of advance royalties under coal leases

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 in a case in which operations under the lease are interrupted by strikes, the elements, or casualties not attributable to the lessee.

(2)
(A)

The Secretary of the Interior may suspend the condition of continued operation upon the payment of advance royalties, if the Secretary determines that the public interest will be served by the suspension.

(B)

Advance royalties required under subparagraph (A) shall be computed based on—

(i)

the average price for coal sold in the spot market from the same region during the last month of each applicable continued operation year; or

(ii)

by using other methods established by the Secretary of the Interior to capture the commercial value of coal,

and 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 0) by the amount of any advance royalties paid under the lease, to the extent that the advance royalties have not been used to reduce production royalties for a prior year.

(4)

The Secretary may, upon 6 months’ notice to a lessee, cease to accept advance royalties in lieu of the requirement of continued operation.

(5)

Nothing in this subsection affects the requirement contained in the second sentence of subsection (a) relating to commencement of production at the end of 10 years.

.

424.

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 in the first sentence by striking and not later than three years after a lease is issued,.

425.

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 2003 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.

.

426.

Inventory requirement

(a)

Review of assessments

(1)

In general

The Secretary of the Interior, in consultation with the Secretary of Agriculture and the Secretary, shall review coal assessments and other available data to identify—

(A)

public lands, other than National Park 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 subparagraph (A); and

(C)

with respect to areas of such lands for which sufficient data exists, resources of compliant coal and supercompliant coal.

(2)

Definitions

In this subsection:

(A)

Compliant coal

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.

(B)

Supercompliant coal

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 of the Interior—

(1)

shall complete the inventory under subsection (a)(1) by not later than 2 years after the date of the enactment of this Act; and

(2)

shall update the inventory as the availability of data and developments in technology warrant.

(c)

Report

The Secretary of the Interior shall submit to Congress, 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 that inventory.

427.

Application of amendments

The amendments made by this subtitle apply—

(1)

with respect to any coal lease issued on or after the date of enactment of this Act; and

(2)

with respect to any coal lease issued before the date of enactment of this Act, upon the earlier of—

(A)

the date of readjustment of the lease as provided for by section 7(a) of the Mineral Leasing Act (30 U.S.C. 207(a)); or

(B)

the date the lessee requests such application.

D

Coal and related programs

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:

XXXI

Clean air coal program

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).

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.

3103.

Authorization of appropriations

(a)

Pollution control projects

There are authorized to be appropriated to the Secretary $300,000,000 for fiscal year 2005, $100,000,000 for fiscal year 2006, $40,000,000 for fiscal year 2007, $30,000,000 for fiscal year 2008, and $30,000,000 for fiscal year 2009, 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 2011 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 $150,000,000 for fiscal year 2006, $250,000,000 for each of the fiscal years 2007 through 2011, and $100,000,000 for fiscal year 2012, 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.

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.

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 2005 through 2010 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 2011 and 2012 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,

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.

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.

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.

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

.

V

Indian energy

501.

Short title

This title may be cited as the Indian Tribal Energy Development and Self-Determination Act of 2004.

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:

217.

Office of Indian Energy Policy and Programs

(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 Director, Office of Indian Energy Policy and Programs, Department of Energy. after Inspector General, Department of Energy..

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:

XXVI

Indian energy

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;

(B)

any land not located within the boundaries of an Indian reservation, pueblo, or rancheria, the title to which is held—

(i)

in trust by the United States for the benefit of an Indian tribe or an individual Indian;

(ii)

by an Indian tribe or an individual Indian, subject to restriction against alienation under laws of the United States; or

(iii)

by a dependent Indian community; and

(C)

land that is owned by an Indian tribe and was conveyed by the United States to a Native Corporation pursuant to the Alaska Native Claims Settlement Act (43 U.S.C. 1601 et seq.), or that was conveyed by the United States to a Native Corporation in exchange for such land.

(3)

The term Indian reservation includes—

(A)

an Indian reservation in existence in any State or States as of the date of enactment of this paragraph;

(B)

a public domain Indian allotment; and

(C)

a dependent Indian community located within the borders of the United States, regardless of whether the community is located—

(i)

on original or acquired territory of the community; or

(ii)

within or outside the boundaries of any 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.

2602.

Indian tribal energy resource development

(a)

Department of the interior Program

(1)

To assist Indian tribes in the development of energy resources and further the goal of Indian self-determination, the Secretary shall establish and implement an Indian energy resource development program to assist consenting Indian tribes and tribal energy resource development organizations in achieving the purposes of this title.

(2)

In carrying out the Program, the Secretary shall—

(A)

provide development grants to Indian tribes and tribal energy resource development organizations for use in developing or obtaining the managerial and technical capacity needed to develop energy resources on Indian land, and to properly account for resulting energy production and revenues;

(B)

provide grants to Indian tribes and tribal energy resource development organizations for use in carrying out projects to promote the integration of energy resources, and to process, use, or develop those energy resources, on Indian land; 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 2004 through 2014.

(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).