S. 3036 (110^th): Lieberman-Warner Climate Security Act of 2008

include the quantity and type of fossil fuels, including feedstock fossil fuels, that are extracted, produced, refined, imported, exported, or consumed at or by the facility;

include the quantity of hydrofluorocarbons, perfluorocarbons, sulfur hexafluoride, nitrous oxide, carbon dioxide that has been captured and sequestered, and other greenhouse gases generated, produced, imported, exported, or consumed at or by the facility;

include the quantity of electricity generated, imported, exported, or consumed by or at the facility, and information on the quantity of greenhouse gases emitted when the imported, exported, or consumed electricity was generated, as determined by the Administrator;

include the aggregate quantity of all greenhouse gas emissions from sources at the facility, including stationary combustion source emissions, process emissions, and fugitive emissions;

include greenhouse gas emissions expressed in metric tons of each greenhouse gas emitted and in the quantity of carbon dioxide equivalents of each greenhouse gas emitted;

include a list and description of sources of greenhouse gas emissions at the facility;

quantify greenhouse gas emissions in accordance with the measurement standards established under section 1104;

include other data necessary for accurate and complete accounting of greenhouse gas emissions, as determined by the Administrator;

include an appropriate certification regarding the accuracy and completeness of reported data, as determined by the Administrator; and

are submitted electronically to the Administrator, in such form and to such extent as may be required by the Administrator.

In general

The Administrator may determine—

Factors

In making a determination under paragraph (1), the Administrator shall consider the availability and suitability of simplified techniques and tools for quantifying emissions and the cost to measure those emissions relative to the purposes of this title, including the goal of collecting complete and consistent facility-wide data.

Calendar years 2004 through 2007

For a baseline period of calendar years 2004 through 2007, each affected facility shall submit required annual data described in this section to the Administrator not later than March 31, 2009.

Subsequent calendar years

For calendar year 2008 and each subsequent calendar year, each affected facility shall submit quarterly data described in this section to the Administrator not later than 60 days after the end of the applicable quarter.

fossil fuel production, refining, importation, exportation, or consumption data;

greenhouse gas emission data; or

other relevant data.

In general

The Administrator shall establish by regulation, taking into account the work done by the Climate Registry, comprehensive protocols and methods to ensure the accuracy, completeness, consistency, and transparency of data on greenhouse gas emissions and fossil fuel production, refining, importation, exportation, and consumption submitted to the Registry that include—

Best practices

The protocols and methods developed under paragraph (1) shall incorporate and conform to the best practices from the most recent Federal, State, and international protocols for the measurement, accounting, reporting, and verification of greenhouse gas emissions to ensure the accuracy, completeness, and consistency of the data.

provide information sufficient for the Administrator to verify, in accordance with the protocols and methods developed under subsection (a), that the fossil fuel data and greenhouse gas emission data of the affected facility have been completely and accurately reported; and

ensure the submission or retention, for the 5-year period beginning on the date of provision of the information, of—

prescribe methods to estimate emissions for the facility for each period for which data are missing, reflecting the highest emission levels that may reasonably have occurred during the period for which data are missing; and

take appropriate enforcement action pursuant to this section and section 9002(b).

design and operate the Registry;

establish an advisory body that is broadly representative of private enterprise, agriculture, environmental groups, and State, tribal, and local governments to guide the development and management of the Registry;

provide coordination and technical assistance for the development of proposed protocols and methods, taking into account the duties carried out by the Climate Registry, to be published by the Administrator;

verify and audit the data submitted by reporting entities;

establish consistent policies for calculating carbon content and greenhouse gas emissions for each type of fossil fuel reported under section 1103;

calculate carbon content and greenhouse gas emissions associated with the combustion of fossil fuel data reported by reporting entities;

immediately publish on the Internet all information contained in the Registry, except in any case in which publishing the information would result in a disclosure of—

not later than 180 days after the date of enactment of this Act, propose regulations to carry out this section; and

not later than July 1, 2008, promulgate final regulations to carry out this section.

In general

An emission allowance shall not be a property right.

Termination or limitation

Nothing in this Act or any other provision of law limits the authority of the United States to terminate or limit an emission allowance.

Other provisions unaffected

Nothing in this Act relating to emission allowances shall affect the application of, or compliance with, any other provision of law to or by a covered facility.

group I greenhouse gas that was emitted by the use of coal by that covered facility during the preceding year;

group I greenhouse gas that will, assuming no capture and sequestration of that gas, be emitted from the use of any petroleum- or coal-based liquid or gaseous fuel that was produced or imported by that covered facility during the preceding year;

group I greenhouse gas that was produced for sale or distribution or imported by that facility during the preceding year;

group II greenhouse gas that was emitted as a byproduct of hydrochlorofluorocarbon production; and

group I greenhouse gas that will, assuming no capture and destruction or sequestration of that gas, be emitted—

Assumptions

For the purpose of calculating the submission requirement under paragraphs (2) through (5) of subsection (a), the Administrator shall, subject to subsections (e) through (g), assume that no capture, sequestration, chemical retention, or other retention of a greenhouse gas has occurred or will occur.

Factors for consideration

For the purpose of calculating the submission requirement under paragraph (1) of subsection (a), the Administrator shall take into account any metric tons of carbon dioxide that the owner or operator has geologically sequestered during the preceding calendar year.

In general

The owner or operator of any covered facility that fails for any year to submit to the Administrator by the deadline described in section 1202(a) or 2303, 1 or more of the emission allowances due pursuant to either of those sections shall be liable for the payment to the Administrator of an excess emissions penalty.

Amount

The amount of an excess emissions penalty required to be paid under paragraph (1) shall be, as determined by the Administrator, an amount equal to the product obtained by multiplying—

Timing

An excess emissions penalty required under this subsection shall be immediately due and payable to the Administrator, without demand, in accordance with such regulations as shall be promulgated by the Administrator by the date that is 1 year after the date of enactment of this Act.

Deposit

The Administrator shall deposit each excess emissions penalty paid under this subsection in the Treasury of the United States.

No effect on liability

An excess emissions penalty due and payable by the owner or operator of a covered facility under this subsection shall not diminish the liability of the owner or operator for any fine, penalty, or assessment against the owner or operator for the same violation under any other provision of this Act or any other law.

In general

The owner or operator of a covered facility that fails for any year to submit to the Administrator by the deadline described in section 1202(a) or 2303 1 or more of the emission allowances due pursuant to either of those sections shall be liable to offset the excess emissions by an equal quantity, in tons, during—

Plan

to pay the penalty in accordance with this section;

to provide, and thereafter comply with, a proposed plan for compliance as required by subsection (b)(2); and

to offset excess emissions as required by subsection (b)(1).

In general

The regulations promulgated under subsection (a) shall permit the transfer of allowances prior to the issuance of the allowances.

Deduction and addition of transfers

A recorded pre-allocation transfer of allowances shall be—

borrow emission allowances from the Administrator; and

for a calendar year, submit borrowed emission allowances to the Administrator in satisfaction of up to 15 percent of the compliance obligation under section 1202(a).

shall be designed to ensure that, to the maximum extent practicable, agricultural organizations and individual agricultural producers, foresters, and other landowners receive detailed practical information about—

shall provide—

may include the creation and development of regional marketing centers or coordination with existing centers (including centers within the Natural Resources Conservation Service or the Cooperative State Research, Education, and Extension Service or at land-grant colleges and universities).

In general

Not later than 2 years after the date of enactment of this Act, the Secretary of Agriculture, in consultation with the Administrator and after an opportunity for public comment, shall publish a handbook for use by agricultural producers, agricultural cooperatives, foresters, other landowners, offset buyers, and other stakeholders that provides easy-to-use guidance on achieving, reporting, registering, and marketing offsets.

Distribution

The Secretary of Agriculture shall ensure, to the maximum extent practicable, that the handbook—

In general

Not later than 18 months after the date of enactment of this Act, the Administrator, in conjunction with the Secretary of Agriculture, shall promulgate regulations authorizing the issuance and certification of offset allowances.

Certain sources

Agricultural, forestry, and other land use-related projects

For offsets from certain agricultural, forestry, and other land use-related projects undertaken within the United States, the regulations promulgated under this subsection shall include provisions that—

the offset allowance has not expired or been retired or canceled; and

liability and responsibility for mitigating and compensating for reversals of registered offset allowances is specified in accordance with section 2406(b).

agricultural and rangeland sequestration and management practices, including—

changes in carbon stocks attributed to land use change and forestry activities limited to—

manure management and disposal, including—

subject to the requirements of this subtitle, any other terrestrial offset practices identified by the Administrator, including—

combinations of any of the offset practices described in paragraphs (1) through (4).

may submit a petition for offset project approval at any time following the effective date of regulations promulgated under section 2402(b); but

may not register or issue offset allowances until such approval is received and until after the emission reductions or sequestrations supporting the offset allowances have actually occurred.

a copy of the monitoring and quantification plan prepared for the offset project, as described under subsection (d);

a greenhouse gas initiation certification, as described under subsection (e); and

subject to the requirements of this subtitle, any other information identified by the Administrator in the regulations promulgated under section 2402 as necessary to meet the objectives of this subtitle.

In general

Not later than 180 days after the date on which the Administrator receives a complete petition under subsection (b), the Administrator shall—

Appeal

The Administrator shall establish mechanisms for appeal and review of determinations made under this subsection.

In general

A project developer shall make use of the standardized tools and methods described in this section to monitor, quantify, and discount reductions in greenhouse gas emissions or increases in sequestration.

Monitoring and quantification plan

A monitoring and quantification plan shall be used to monitor, quantify, and discount reductions in greenhouse gas emissions or increases in sequestration as described by this subsection.

Plan completion and retention

A monitoring and quantification plan shall be—

Plan requirements

Subject to section 2402, the Administrator, in conjunction with the Secretary of Agriculture, shall specify the required components of a monitoring and quantification plan, including—

In general

In reviewing a petition submitted under subsection (b), the Administrator shall seek to exclude each activity that undermines the integrity of the offset program established under this subtitle, such as the conversion or clearing of land, or marked change in management regime, in anticipation of offset project initiation.

Greenhouse gas initiation certification requirements

A greenhouse gas initiation certification developed under this subsection shall include—

Determination of significant deviation

Based on standards developed by the Administrator, in conjunction with the Secretary of Agriculture—

Adjustment for projects with significant deviation

In the case of a significant deviation, the Administrator shall adjust the number of allowances awarded in order to account for the deviation.

In general

Subject to section 2402(b), the Administrator, in conjunction with the Secretary of Agriculture, shall develop standardized tools for use in the monitoring and quantification of changes in greenhouse gas fluxes or carbon stocks for each offset project type listed under section 2403(b).

Tool development

The tools used to monitor and quantify changes in greenhouse gas fluxes or carbon stocks shall, for each project type, include applicable—

In general

The Administrator, in consultation with the Secretary of Agriculture, shall—

Additionality determination and baseline estimation

The standardized methods used to determine additionality and establish baselines shall, for each project type, at a minimum—

Leakage

The standardized methods used to determine and discount for leakage shall, at a minimum, take into consideration—

In general

The Administrator, in conjunction with the Secretary of Agriculture, shall develop standardized methods for use in determining and discounting for uncertainty for each offset project type listed under section 2403(b).

Basis

The standardized methods used to determine and discount for uncertainty shall be based on—

establish a comprehensive field sampling program to improve the scientific bases on which the standardized tools and methods developed under this section are based; and

review and revise the standardized tools and methods developed under this section, based on—

Scope of verification

A verification report for an offset project shall—

Verification report requirements

The Administrator shall specify the required components of a verification report, including—

Verifier accreditation

In general

Not later than 90 days after the date on which the Administrator receives a verification report required under subsection (b), the Administrator shall—

Affirmative determination

In the case of an affirmative determination under paragraph (1), the Administrator shall—

Appeal and review

The Administrator shall establish mechanisms for the appeal and review of determinations made under this subsection.

In general

Subject to section 2402, the Administrator shall promulgate regulations requiring the submission of a reversal certification for each offset project on an annual basis following the registration of offset allowances.

Requirements

A reversal certification submitted in accordance with this subsection shall state—

Invalidity

The Administrator shall declare invalid all offset allowances issued for any offset project that has undergone a complete reversal.

Partial reversal

In the case of an offset project that has undergone a partial reversal, the Administrator shall render invalid offset allowances issued for the offset project in direct proportion to the degree of reversal.

an equal number of offset allowances; or

a combination of offset allowances and emission allowances equal to the unmitigated reversal.

principles for initiating and conducting examinations;

the type or scope of examinations, including—

the rights and privileges of an examined party; and

the establishment of an appeal process.

In general

The Administrator may allow for the transition into the Registry of offset projects and banked offset allowances that, as of the effective date of regulations promulgated under section 2407(a), are registered under or meet the standards of the Climate Registry, the California Action Registry, the GHG Registry, the Chicago Climate Exchange, the GHG CleanProjects Registry, or any other Federal, State, or private reporting programs or registries if the Administrator determines that such other offset projects and banked offset allowances under those other programs or registries satisfy the applicable requirements of this subtitle.

Exception

An offset allowance that is expired, retired, or canceled under any other offset program, registry, or market as of the effective date of regulations promulgated under section 2407(a) shall be ineligible for transition into the Registry.

the incentives, programs, or policies capable of fostering improvements to human health or the environment in conjunction with the implementation of offset projects under this subtitle; and

the cost of those incentives, programs, or policies.

to ensure native plant materials are given primary consideration, in accordance with applicable Department of Agriculture guidance for use of native plant materials;

to prohibit the use of Federal- or State-designated noxious weeds; and

to prohibit the use of a species listed by a regional or State invasive plant council within the applicable region or State.

approving the use under this subtitle of emission allowances from such foreign greenhouse gas emissions trading markets as the regulations may establish; and

permitting the use of international emission allowances from the foreign country that issued the emission allowances.

an emission allowance shall have been issued by a foreign country pursuant to a governmental program that imposes mandatory absolute tonnage limits on greenhouse gas emissions from the foreign country, or 1 or more industry sectors in that country, pursuant to protocols described in subsection (a); and

the governmental program be of comparable stringency to the program established by this Act, including comparable monitoring, compliance, and enforcement.

to promote the achievement of the purposes of this Act;

to observe the national greenhouse gas emission market and evaluate periods during which the cost of emission allowances provided under Federal law might pose significant harm to the economy; and

to submit to the President and Congress, and publish on the Internet, quarterly reports—

Composition

The Board shall be composed of—

Requirements

In appointing members of the Board under paragraph (1), the President shall—

Compensation

Prohibitions

Term

Vacancies

1 member to serve as Chairperson of the Board for a term of 4 years; and

1 member to serve as Vice-Chairperson of the Board for a term of 4 years.

Initial meeting

The Board shall hold the initial meeting of the Board as soon as practicable after the date on which all members have been appointed to the Board under subsection (c)(1).

Presiding officer

A meeting of the Board shall be presided over by—

Quorum

Four members of the Board shall constitute a quorum for a meeting of the Board.

Open meetings

The Board shall be subject to section 552b of title 5, United States Code (commonly known as the Government in the Sunshine Act).

Authority

The Board shall collect and analyze relevant market information to promote a full understanding of the dynamics of the emission allowance market established under this Act.

Information

The Board shall gather such information as the Board determines to be appropriate regarding the status of the market, including information relating to—

In general

During the initial 2-year period of operation of the Board, information gathering under subsection (a) shall be the primary activity of the Board.

Subsequent authority

After the 2-year period described in paragraph (1), the Board shall assume authority to implement the cost-relief measures described in section 2604(a).

In general

During the 2-year period beginning on the date on which the emission allowance market established under this Act begins operation, the Board shall conduct a study of other markets for tradeable permits to emit covered greenhouse gases.

Report

Not later than 180 days after the beginning of the period described in paragraph (1), the Board shall submit to Congress, and publish on the Internet, a report describing the status of the market, specifically with respect to volatility within the market and the average price of emission allowances during that 180-day period.

In general

If the Board determines that the emission allowance market established under this Act poses a significant harm to the economy of the United States, the Board shall carry out such cost relief measures relating to that market as the Board determines to be appropriate under section 2604(a).

Initial period

During the 2-year period beginning on the date on which the emission allowance market established under this Act begins operation, if the Board determines that the average daily closing price of emission allowances during a 180-day period exceeds the upper range of the estimate provided under section 2605, the Board shall—

Requirements

Any action carried out pursuant to this subsection shall be subject to the requirements of section 2604(a)(3)(B).

describing the status of the emission allowance market established under this Act, the economic effects of the market, regional, industrial, and consumer responses to the market, energy investment responses to the market, the effects on the market of any fraud on, or manipulation of, the market that the Board has identified, any corrective measures that should be carried out to relieve excessive costs of the market, and plans to compensate for those measures; and

that are prepared independently by the Board, and not in partnership with Federal agencies.

In general

Beginning on the day after the date of expiration of the 2-year period described in section 2603(b), the Board may carry out 1 or more of the following cost relief measures to ensure functioning, stable, and efficient markets for emission allowances:

Subsequent actions

On determination by the Board to carry out a cost relief measure pursuant to paragraph (1), the Board shall—

Action on expansion of borrowing

to consider or prescribe entity-level petitions for relief from the costs of an emission allowance allocation or trading program established under Federal law;

to carry out any investigative or punitive process under the jurisdiction of any Federal or State court;

to interfere with, modify, or adjust any emission allowance allocation scheme established under Federal law; or

to modify the total quantity of emission allowances issued under this Act for the period of calendar years 2012 through 2050.

the Climate Leaders Program, or any other voluntary greenhouse gas reduction program of the United States Environmental Protection Agency and United States Department of Energy;

the Voluntary Reporting of Greenhouse Gases Program of the Energy Information Administration;

State or regional greenhouse gas emission reduction programs that include systems for tracking and verifying the greenhouse gas emission reductions; and

voluntary entity programs that resulted in entity-wide reductions in greenhouse gas emissions.

automatically adjust the rates charged by natural gas and electric utilities to fully recover fixed costs of service without regard to whether their actual sales are higher or lower than the forecast of sales on which the tariffed rates were based; and

make cost-effective energy-efficiency expenditures by investor-owned natural gas or electric utilities at least as rewarding to their shareholders as power or energy purchases, or expenditures on new energy supplies or infrastructure.

before the date of enactment of this Act, enacted statewide greenhouse gas emission reduction targets that are more stringent than the nationwide targets established under subtitle B of title I; and

by the time of an allocation under this subsection, imposed on covered facilities within the States aggregate greenhouse gas emission limitations more stringent than those imposed on covered facilities under subtitle B of title I.

For each calendar year, 1/3 of the quantity of allowances available for allocation to States under subsection (a) shall be distributed among individual States based on the proportion that—

For each calendar year, 1/3 of the quantity of allowances available for allocation to States under subsection (a) shall be distributed among the States based on the proportion that—

For each calendar year, 1/3 of the quantity of allowances available for allocation to States under subsection (a) shall be distributed among the States based on the proportion that—

In general

During any calendar year, a State shall retire or use in 1 or more of the following ways not less than 90 percent of the allowances allocated to the State (or proceeds of sale of those emission allowances) under this section for that calendar year:

Deadline

A State shall distribute or sell allowances for use in accordance with paragraph (1) by not later than the beginning of each allowance allocation year.

Return of allowances

Not later than 330 days before the end of each allowance allocation year, a State shall return to the Administrator any allowances not distributed by the deadline under paragraph (2).

Use for recycling

During any calendar year, a State shall retire or use not less than 5 percent of the emission allowances allocated to the State (or proceeds of sale of those emission allowances) under this section for increasing recycling rates through activities such as—

Establishment

Not later than 3 years after the date of enactment of this Act, the Administrator, in consultation with the Secretary of the Interior, shall by regulation establish a program for tribal communities—

Allocation

Beginning in the first calendar year that begins after promulgation of the regulations referred to in paragraph (1), and annually thereafter until calendar year 2050, the Administrator shall allocate 0.5 percent of the quantity of remainder emission allowances for each calendar year to the program established under paragraph (1).

use the emission allowances (or proceeds of sale of those emission allowances) only for—

shall ensure that use of the emission allowances (or proceeds of sale of those emission allowances) by the State for the purposes described in paragraph (1) is geographically distributed as follows:

the quantity of electricity delivered by the load-serving entity during the 3 calendar years preceding the calendar year for which the emission allowances are distributed, adjusted upward for electricity not delivered as a result of consumer energy-efficiency programs implemented by the load-serving entity and verified by the regulatory agency of the load-serving entity; bears to

the total quantity of electricity delivered by all load-serving entities during those 3 calendar years.

sell each emission allowance distributed to the load-serving entity by not later than 1 year after receiving the emission allowance; and

pursue fair market value for each emission allowance sold in accordance with paragraph (1).

to mitigate economic impacts on low- and middle-income energy consumers, including by reducing transmission charges or issuing rebates; and

to promote energy efficiency on the part of energy consumers.

the date of each sale of each emission allowance during the preceding year;

the amount of revenue generated from the sale of emission allowances during the preceding year; and

how, and to what extent, the load-serving entity used the proceeds of the sale of the emission allowances during the preceding year.

sell each emission allowance distributed to the natural gas local distribution company by not later than 1 year after receiving the emission allowance; and

pursue fair market value for each emission allowance sold in accordance with paragraph (1).

to mitigate economic impacts on low- and middle-income energy consumers; and

to promote energy efficiency on the part of energy consumers.

the date of each sale of each emission allowance during the preceding year;

the amount of revenue generated from the sale of emission allowances during the preceding year; and

how, and to what extent, the natural gas local distribution company used the proceeds of the sale of the emission allowances during the preceding year.

Commenced

The term commenced, with respect to construction, means that an owner or operator has obtained the necessary permits to undertake a continuous program of construction and has entered into a binding contractual obligation, with substantial financial penalties for cancellation, to undertake such a program.

Construction

The term construction means the fabrication, erection, or installation of the technology for the carbon capture and sequestration project.

comply with such criteria and procedures as the Administrator may establish, including a requirement, as prescribed in subsection (c), for an annual emissions performance standard for carbon dioxide emissions from any unit for which allowances are allocated;

sequester, in a geological formation permitted by the Administrator for that purpose in accordance with regulations promulgated under part C of the Safe Drinking Water Act (42 U.S.C. 300h et seq.), carbon dioxide captured from any unit for which allowances are allocated; and

have begun operation during the period beginning on January 1, 2008, and ending on December 31, 2035.

For an electric generation unit that is not a new entrant, an annual emissions rate of not more than 1,200 pounds of carbon dioxide per megawatt-hour of net electricity generation, after subtracting the carbon dioxide that is captured and sequestered.

For a new entrant electric generation unit for which construction of the unit commenced prior to July 1, 2018, an annual emissions rate of not more than 800 pounds of carbon dioxide per megawatt-hour of net electricity generation, after subtracting the carbon dioxide that is captured and sequestered.

For a new entrant electric generation unit for which construction of the unit commenced on or after July 1, 2018, an annual emissions rate of not more than 350 pounds of carbon dioxide per megawatt-hour of net electricity generation, after subtracting the carbon dioxide that is captured and sequestered.

For any unit at a covered facility that is not an electric generation unit, an annual emissions rate that is achieved by the capture and sequestration of a minimum of 85 percent of the total carbon dioxide emissions produced by the unit.

In general

The Corporation may adjust the emissions performance standard for a carbon capture and sequestration project under subsection (c) for an electric generation unit that uses subbituminous coal, lignite, or petroleum coke in significant amounts.

Requirement

In any case described in paragraph (1), the performance standard for the project shall prescribe an annual emissions rate that requires the project to achieve an equivalent reduction from uncontrolled carbon dioxide emissions levels from the use of subbituminous coal, lignite, or petroleum coke, as compared to the emissions that the project would have achieved if that unit had combusted only bituminous coal during the particular year.

the bonus allowance adjustment factor, as determined under subsection (b);

the number of metric tons of carbon dioxide emissions avoided through capture and geologic sequestration of emissions by the project; and

the bonus allowance rate for that calendar year, as provided in the following table:

the factor shall be equal to 1 in the case of a project that qualifies under section 3602(c)(1) during the first 4 years that emissions allowances are distributed to the project; and

the factor shall not exceed 1 for any qualifying project.

research on soil carbon sequestration and other agricultural and forestry greenhouse gas management that has been carried out;

any additional research that is necessary;

the proposed priority for additional research;

the most appropriate approaches for conducting the additional research; and

the extent to which and the manner in which carbon credits that are specific to agricultural and forestry operations, including harvested wood products and the reduction of hazardous fuels to reduce the risk of uncharacteristically severe wildfires, should be valued and allotted.

In general

As soon as practicable after the date of enactment of this Act, the Secretary of Agriculture shall establish a standardized system of carbon measurement and certification for the agricultural and forestry sectors.

Administration

In establishing the system, the Secretary of Agriculture shall—

carried out and managed in accordance with widely-accepted environmentally sustainable forestry practices; and

designed—

demonstrated capacity to participate in international forest carbon activities, including—

capped greenhouse gas emissions or otherwise established a national emission reference scenario based on historical data; and

commenced an emission reduction program for the forest sector.

Reduction in deforestation and forest degradation

A verified reduction in greenhouse gas emissions from deforestation and forest degradation under a cap or from a nationwide emissions reference scenario described in subsection (a) shall be—

Periodic review of national level reductions in deforestation and degradation

The Administrator, in consultation with the Secretary of State, shall identify and periodically update a list of countries described in subsection (a) that have—

Other forest carbon activities

A forest carbon activity, other than a reduction in deforestation or forest degradation, shall be eligible for distribution of emission allowances under this section, subject to the quality criteria for forest carbon activities identified in this Act or in regulations promulgated under this Act.

shall recognize forest carbon activities, subject to the quality criteria for forest carbon activities identified in this Act and regulations promulgated under this Act; and

is encouraged to identify other incentives, including economic and market-based incentives, to encourage developing countries with largely-intact native forests to protect those forests.

emission allowances are not distributed to an owner or operator for any facility that has been permanently shut down at the time of the distribution;

the owner or operator of any facility that permanently shuts down in a calendar year shall promptly return to the Administrator any emission allowances that the Administrator has distributed for that facility for any subsequent calendar years; and

that, if a facility receives a distribution of emission allowances under this subtitle for a calendar year and subsequently permanently shuts down during that calendar year, the owner or operator of the facility shall promptly return to the Administrator a number of emission allowances equal to the number that the Administrator determines is the portion that the owner or operator will no longer need to submit for that facility under section 1202(a).

In general

As part of the system established under section 3901(b), the Administrator shall, for each calendar year, set aside, from the quantity of emission allowances represented by the percentages described in the table contained in section 3901(a) for owners and operators of fossil fuel-fired electric power generating facilities, a quantity of emission allowances for distribution to owners and operators of new entrant fossil fuel-fired electric power generating facilities (including such new entrant facilities owned or operated by rural electric cooperatives in any State that is not a participant in the pilot program established under section 3903(a)).

Calculation of allowances

The quantity of emission allowances distributed by the Administrator for a calendar year to a new entrant fossil fuel-fired electric power generating facility under paragraph (1) shall be equal to the product obtained by multiplying—

In general

As part of the system established under section 3901(b), the Administrator shall, for each calendar year, distribute to fossil fuel-fired electric power generating facilities (including such facilities owned or operated by rural electric cooperatives in any State that is not a participant in the pilot program established under section 3903(a)) that were operating during the calendar year preceding the year in which this Act was enacted the emission allowances represented by the percentages described in the table contained in section 3901(a) for owners and operators of fossil fuel-fired electric power generating facilities that remain after the distribution of emission allowances under subsection (a).

Calculation of allowances

The quantity of emission allowances distributed to a fossil fuel-fired electric power generating facility under paragraph (1) shall be equal to the product obtained by multiplying—

In general

As part of the system established under section 3901(b), the Administrator shall establish a pilot program for distributing to rural electric cooperatives in the States described in paragraph (2), for each of calendar years 2012 through 2029, 15 percent of the total number of emission allowances allocated for the calendar year to rural electric cooperatives under section 3901(a).

Description of States

The States referred to in subsection (a) are—

the benefits realized by ratepayers of the rural electric cooperatives that receive allowances under the pilot program; and

the use by those rural electric cooperatives of advanced, low greenhouse gas-emitting electric generation technologies, if any.

Currently operating facility

The term currently operating facility means an eligible manufacturing facility that had significant operations during the calendar year preceding the calendar year for which emission allowances are being distributed under this section.

Eligible manufacturing facility

Indirect carbon dioxide emissions

The term indirect carbon dioxide emissions means the product obtained by multiplying (as determined by the Administrator)—

New entrant manufacturing facility

The term new entrant manufacturing facility, with respect to a calendar year, means an eligible manufacturing facility that began operation during or after the calendar year for which emission allowances are being distributed under this section.

the total quantity of emission allowances available for allocation under subsection (b); and

the ratio that (during the calendar year preceding the calendar year for which emission allowances are being distributed under this section)—

the total quantity of emission allowances available for allocation to currently-operating facilities in the appropriate category, as determined under subsection (c); and

the ratio that (during the 3 calendar years preceding the year for which the allocation rule is promulgated for the allocation period)—

In general

As part of the system established under section 3901(b), the Administrator shall, for each calendar year, distribute 4 percent of the total quantity of emission allowances available for allocation to carbon intensive manufacturing under section 3901(a) to new entrant manufacturing facilities.

Individual allocations

The quantity of emission allowances distributed by the Administrator for a calendar year to a new entrant manufacturing facility shall be proportional to the product obtained by multiplying—

the quantity of emission allowances available for distribution under subsection (a); and

the quotient obtained by dividing—

Conflicts of interest

An individual employed by, or holding any official relationship (including any shareholder) with, any entity engaged in the generation, transmission, distribution, or sale of energy, an individual who has any pecuniary interest in the generation, transmission, distribution, or sale of energy, or an individual who has a pecuniary interest in the implementation of this Act, shall not be appointed to the Corporation under this subtitle.

No other employment

A member of the Corporation shall not hold any other employment during the term of service of the member.

In general

A vacancy on the Corporation—

Service until new appointment

A member of the Corporation the term of whom has expired or otherwise been terminated shall continue to serve until the date on which a replacement is appointed if the President determines that service to be appropriate.

In general

A member may be removed from the Corporation on determination of the President for cause.

Notification

Not later than 30 days before removing a member from the Corporation for cause under paragraph (1), the President shall provide to Congress an advance notification of the determination by the President to remove the member.

Bureau of Land Management Emergency Firefighting Fund

For each of calendar years 2012 through 2050, the Corporation shall deposit into the Bureau of Land Management Emergency Firefighting Fund established by section 4101(5) proceeds, from annual auctions that the Corporation conducts for the calendar year under this section, that are sufficient to ensure that the amount in the Fund equals $300,000,000.

Forest Service Emergency Firefighting Fund

For each of calendar years 2012 through 2050, the Corporation shall deposit into the Forest Service Emergency Firefighting Fund established by section 4101(6) proceeds, from annual auctions that the Corporation conducts for the calendar year under this section, that are sufficient to ensure that the amount in the Fund equals $800,000,000.

Climate Security Act Management Fund

Use of remaining proceeds

Energy savings

The term energy savings means megawatt-hours of electricity or million British thermal units of natural gas saved by a product, in comparison to projected energy consumption under an energy-efficiency standard applicable to the product.

Engineering integration costs

The term engineering integration costs includes the costs of engineering tasks relating to—

High-efficiency consumer product

The term high-efficiency consumer product means a covered product to which an energy conservation standard applies under section 325 of the Energy Policy and Conservation Act (42 U.S.C. 6295), if the energy efficiency of the product exceeds the energy efficiency required under the standard.

Qualifying component

The term qualifying component means a component that the Secretary of Energy determines to be specially designed for zero- or low-carbon generation technology.

Zero- or low-carbon generation

The term zero- or low-carbon generation means generation of electricity by an electric generation unit that—

Zero- or low-carbon generation technology

The term zero- or low-carbon generation technology means a technology used to create zero- or low-carbon generation.

the production of electricity from new zero- or low-carbon generation;

the manufacture of high-efficiency consumer products; and

facility establishment or conversion by manufacturers and component suppliers of zero- or low-carbon technology.

In general

The Corporation shall make awards under this section to domestic producers of new zero- or low-carbon generation, domestic manufacturers of high-efficiency consumer products, and domestic facilities and operations of manufacturers and component suppliers of zero- or low-carbon generation technology—

Acceptance of bids

Zero- and low-carbon generators

An award for zero- or low-carbon generation under this subsection shall be in the form of a contract to provide a production payment for each year during the first 10 years of commercial service of the generation unit in an amount equal to the product obtained by multiplying—

High-efficiency consumer products

An award for a high-efficiency consumer product under this subsection shall be in the form of a lump sum payment in an amount equal to the product obtained by multiplying—

Manufacturing of zero- or low-carbon generation technology

document the greatest use of domestically sourced parts and components;

return to productive service existing idle manufacturing capacity;

are located in States with the greatest availability of unemployed manufacturing workers;

compensate workers at a minimum amount equal to at least 100 percent of the State average manufacturing wage, plus health insurance benefits;

demonstrate a high probability of commercial success; and

achieve other criteria, as the Corporation determines to be appropriate.

Definitions

In this section:

Adjustment of performance standards

Demonstration projects

Deployment incentives

Storage agreement required

The Corporation shall require a binding storage agreement for the carbon dioxide captured in a project under this subsection in a geological storage project permitted by the Administrator under regulations promulgated pursuant to section 1421(d) of the Safe Drinking Water Act (42 U.S.C. 300h(d)).

Distribution of funds

Limitation

A project may not receive an award under this subsection if the project receives an award under section 4402.

In general

The Corporation shall use not less than 1/2 of the amounts made available to carry out this section for each fiscal year for large-scale geological carbon storage demonstration projects that store carbon dioxide captured from electric generation units using coal gasification or other advanced coal combustion processes, including units that receive assistance under subsection (a).

Project capital and operating costs

meet United States fuel and emission specifications;

help diversify domestic transportation energy supplies; and

improve or maintain air, water, soil, and habitat quality, and protect scarce water supplies.

loan guarantees for the construction of production facilities and supporting infrastructure; or

production payments through a reverse auction in accordance with subsection (d).

In general

In providing incentives under this section, the Corporation shall—

Requirement

The rules under section 4402 shall require that incentives shall be provided to the producers that submit the lowest bid (in terms of cents per gallon gasoline equivalent) for each class of transportation fuel from which the Corporation solicits a bid.

Advanced technology vehicle

The term advanced technology vehicle means an electric vehicle, a fuel cell-powered vehicle, a hybrid or plug-in hybrid electric vehicle, or an advanced diesel light duty motor vehicle, that meets—

Combined fuel economy

The term combined fuel economy means—

Engineering integration costs

The term engineering integration costs includes the cost of engineering tasks performed in the United States relating to—

Qualifying component

The term qualifying component means a component that the Secretary of Energy determines to be—

reequipping or expanding an existing manufacturing facility to produce—

engineering integration of qualifying vehicles and qualifying components.

facilities and equipment placed in service after the date of enactment of this Act and before January 1, 2030; and

engineering integration costs incurred after the date of enactment of this Act.

Maximum amount

The maximum amount of all awards under this section shall not exceed $40,000,000,000.

CAFE requirements

The Corporation shall not make an award under this section to an automobile manufacturer or component supplier that, directly or through a parent, subsidiary, or affiliated entity, is not in compliance with each corporate average fuel economy standard under section 32902 of title 49, United States Code, in effect on the date of the award.

Definition of recipient

In this subsection, the term recipient means the automobile manufacturer or component supplier (including any parent, subsidiary, and affiliated entities) that receives an award under this section.

Certification

To be eligible for an award under this section, an automobile manufacturer or component supplier (including any parent, subsidiary, and affiliated entities) shall certify to the Corporation that, for each of the 7 calendar years following the receipt of the award, the manufacturer or supplier will maintain in the United States a number of full-time or full-time-equivalent employees—

Recertification

Not later than 1 year after the date of receipt of an award under this section, and annually thereafter, a manufacturer or supplier shall—

Repayment

A manufacturer or supplier that fails to make the recertification required by paragraph (3) shall pay to the Corporation an amount equal to the difference between—

In general

The Corporation shall use not less than 25 percent of the amounts made available to carry out this section for each fiscal year to provide Federal financial incentives to facilitate the deployment in the United States of sustainable energy technology, including in distributed energy systems.

Administration

In providing incentives under this subsection, the Corporation shall provide appropriate incentives for regulated investor-owned utilities, municipal utilities, electric cooperatives, independent power producers, and consumers, as determined by the Secretary of Energy.

A loan guarantee.

A cost-sharing grant to cover the incremental cost of installing and operating equipment (for which utilization costs may be covered for the first 10 years of operation).

Production payments of not more than 1.5 cents per kilowatt-hour of electric output during the first 10 years of commercial service of the project.

linking research and development in low-carbon energy, sustainable energy, and energy efficiency technology with the development of standards and curricula for current and future jobs;

the tracking and documentation of academic and occupational competencies and future skill needs with respect to low-carbon energy, sustainable energy, and energy efficiency technology;

tracking and documentation of occupational information and workforce training data with respect to low-carbon energy, sustainable energy, and energy efficiency technology;

assessing new employment and work practices, including career ladder and upgrade training and high-performance work systems; and

collaborating with State agencies, industry, organized labor, and community and nonprofit organizations to disseminate successful innovations for labor market services and worker training with respect to low-carbon energy, sustainable energy, and energy efficiency technology.

Grants

Eligibility

To be eligible to receive a grant under paragraph (1), an entity shall be a nonprofit partnership that—

Activities

Activities to be carried out using a grant provided under this subsection may include—

In general

Under the program established under section 4603, the Secretary shall award competitive grants to States to enable the States to administer labor market and labor exchange informational programs that include the implementation of the activities described in paragraph (2).

Activities

A State shall use amounts awarded under this subsection to provide funding to the State agency that administers the Wagner-Peyser Act (29 U.S.C. 49 et seq.) and State unemployment compensation programs to carry out the following activities using State agency merit staff:

In general

Under the program established under section 4603, the Secretary shall award competitive grants to States to enable the States to administer low-carbon energy, sustainable energy, and energy efficiency workforce development programs that include the implementation of the activities described in paragraph (2).

Activities

In general

The Secretary of Labor, in cooperation with the Secretary of Energy, shall promulgate regulations—

Consultation

In carrying out this subsection, the Secretary of Labor shall consult with relevant Federal agencies, representatives of the zero- and low-emitting carbon energy technologies industries, and organized labor, concerning skills and such safety measures that are needed in those industries.

35 percent shall be allocated to the Secretary, and subsequently made available to States through the Wildlife Conservation and Restoration Account established under section 3(a)(2) of the Pittman-Robertson Wildlife Restoration Act (16 U.S.C. 669b(a)(2)), to carry out adaptation activities in accordance with comprehensive State adaptation strategies, as described in subsection (j);

19 percent shall be allocated to the Secretary for use in funding adaptation activities carried out—

5 percent shall be allocated to the Secretary for adaptation activities carried out under cooperative grant programs, including—

1 percent shall be allocated to the Secretary and subsequently made available to Indian tribes to carry out adaptation activities through the tribal wildlife grants program of the United States Fish and Wildlife Service.

Deposits

Exception

For any fiscal year in which a deposit into the Land and Water Conservation Fund under paragraph (1) would result in an amount greater than $900,000,000—

Allocations

Of the amounts deposited under this subsection into the Land and Water Conservation Fund—

Expenditure of funds

In allocating funds under subsection (c), the Secretary and the Secretary of Agriculture shall take into consideration factors including—

large-scale freshwater aquatic ecosystems, such as the Everglades, the Great Lakes, Flathead Lake, the Missouri River, the Mississippi River, the Colorado River, the Sacramento-San Joaquin Rivers, the Ohio River, the Columbia-Snake River System, the Apalachicola, Chattahoochee and Flint River System, the Connecticut River, and the Yellowstone River;

large-scale estuarine ecosystems, such as Chesapeake Bay, Long Island Sound, Puget Sound, the Mississippi River Delta , San Francisco Bay Delta, Narragansett Bay, and Albemarle-Pamlico Sound; and

freshwater and estuarine ecosystems, watersheds, and basins identified as priorities by the Administrator, working in cooperation with other Federal agencies, States, local governments, scientists, and other conservation partners.

large-scale freshwater aquatic ecosystems, such as the ecosystems described in subsection (e)(1);

large-scale estuarine ecosystems, such as the ecosystems described in subsection (e)(2);

freshwater and estuarine ecosystems, watersheds, and basins identified as priorities by the Corps of Engineers, working in cooperation with other Federal agencies, States, local governments, scientists, and other conservation partners; and

habitats or ecosystems under programs such as the Estuary Restoration Act of 2000 (33 U.S.C. 2901 et seq.), project modifications for improvement of the environment, and aquatic restoration under section 206 of the Water Resources Development Act of 1996 (33 U.S.C. 2330).

the coastal and estuarine land conservation program;

the community-based restoration program;

the Coastal Zone Management Act of 1972 (16 U.S.C. 1451 et seq.), subject to the condition that State coastal agencies shall incorporate, and the Secretary of Commerce shall approve, coastal zone management plan elements that are—

the Open Rivers Initiative;

the Magnuson Fishery Conservation and Management Act (16 U.S.C. 1801 et seq.);

the Marine Mammal Protection Act of 1972 (16 U.S.C. 1361 et seq.);

the Endangered Species Act of 1973 (16 U.S.C. 1531 et seq.);

the Marine Protection, Research, and Sanctuaries Act of 1972 (33 U.S.C. 1401 et seq.); and

the Coral Reef Conservation Act of 2000 (16 U.S.C. 6401 et seq.).

In general

Effective beginning on the date on which the President establishes the national strategy under paragraph (3), funds made available under paragraphs (2), (3), and (4) of subsection (b) and subsections (c) through (g) shall be used only for adaptation activities that are consistent with the national strategy.

Initial period

Until the date on which the President establishes the national strategy under paragraph (3), funds made available under paragraphs (2), (3), and (4) of subsection (b) and subsections (c) through (g) shall be used only for adaptation activities that are consistent with a workplan established by the President.

National strategy

In general

Except as provided in paragraph (2), funds made available to States under this subtitle shall be used only for activities that are consistent with a State strategy that has been approved by, as appropriate—

Initial period

Requirements

A State strategy shall—

Updating

Each State strategy described in paragraph (3) shall be updated at least every 5 years.

submit annual reports to the President, the Committees on Environment and Public Works and Foreign Relations of the Senate, and the Committees on Energy and Commerce and Foreign Relations of the House of Representatives, and any other relevant committees on national security, the economy and foreign policy, that describe—

include in each annual report submitted under paragraph (1) a description of how funds made available under section 4804 were spent to enhance the national security of the United States and assist in avoiding the politically destabilizing impacts of climate change in volatile regions of the world, particularly least developed countries; and

identify and recommend the countries in which assistance can have the greatest and most sustainable benefit to reducing vulnerability to climate change, primarily in the form of deploying adaptation and greenhouse gas reduction technologies.

In general

Not later than 3 years after the date of enactment of this Act, the Secretary of the Interior shall establish an accounting and reporting system, in accordance and compatible with National Fire Plan reporting procedures, for the activities carried out under this section.

Requirement

The system established under paragraph (1) shall require that the Secretary of the Interior shall submit to the Committee on Natural Resources of the House of Representatives and the Committee on Energy and Natural Resources of the Senate—

In general

Not later than 3 years after the date of enactment of this Act, the Secretary of Agriculture shall establish an accounting and reporting system, in accordance and compatible with National Fire Plan reporting procedures, for the activities carried out under this section.

Requirement

The system established under paragraph (1) shall require that the Secretary of Agriculture shall submit to the Committee on Natural Resources of the House of Representatives and the Committee on Energy and Natural Resources of the Senate—

by redesignating subsections (e), (f), and (g) as subsections (f), (g), and (h), respectively; and

by inserting after subsection (d) the following:

in subsection (b)—

in subsection (c)(3), by striking subsection (f)(3) and inserting subsection (g)(3).