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<PRE>[DOCID: f:s1131is.txt]





107th CONGRESS
  1st Session
                                S. 1131

     To promote economically sound modernization of electric power 
generation capacity in the United States, to establish requirements to 
   improve the combustion heat rate efficiency of fossil fuel-fired 
  electric utility generating units, to reduce emissions of mercury, 
 carbon dioxide, nitrogen oxides, and sulfur dioxide, to require that 
 all fossil fuel-fired electric utility generating units operating in 
 the United States meet new source review requirements, to promote the 
 use of clean coal technologies, and to promote alternative energy and 
   clean energy sources such as solar, wind, biomass, and fuel cells.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             June 28, 2001

   Mr. Leahy introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
     To promote economically sound modernization of electric power 
generation capacity in the United States, to establish requirements to 
   improve the combustion heat rate efficiency of fossil fuel-fired 
  electric utility generating units, to reduce emissions of mercury, 
 carbon dioxide, nitrogen oxides, and sulfur dioxide, to require that 
 all fossil fuel-fired electric utility generating units operating in 
 the United States meet new source review requirements, to promote the 
 use of clean coal technologies, and to promote alternative energy and 
   clean energy sources such as solar, wind, biomass, and fuel cells.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Clean Power Plant 
and Modernization Act of 2001''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Findings and purposes.
Sec. 3. Definitions.
Sec. 4. Combustion heat rate efficiency standards for fossil fuel-fired 
                            generating units.
Sec. 5. Air emission standards for fossil fuel-fired generating units.
Sec. 6. Extension of renewable energy production credit.
Sec. 7. Megawatt hour generation fees.
Sec. 8. Clean Air Trust Fund.
Sec. 9. Accelerated depreciation for investor-owned generating units.
Sec. 10. Grants for publicly owned generating units.
Sec. 11. Recognition of permanent emission reductions in future climate 
                            change implementation programs.
Sec. 12. Renewable and clean power generation technologies.
Sec. 13. Clean coal, advanced gas turbine, and combined heat and power 
                            demonstration program.
Sec. 14. Evaluation of implementation of this Act and other statutes.
Sec. 15. Assistance for workers adversely affected by reduced 
                            consumption of coal.
Sec. 16. Community economic development incentives for communities 
                            adversely affected by reduced consumption 
                            of coal.
Sec. 17. Carbon sequestration.
Sec. 18. Atmospheric monitoring.

SEC. 2. FINDINGS AND PURPOSES.

    (a) Findings.--Congress finds that--
            (1) the United States is relying increasingly on old, 
        needlessly inefficient, and highly polluting power plants to 
        provide electricity;
            (2) the pollution from those power plants causes a wide 
        range of health and environmental damage, including--
                    (A) fine particulate matter that is associated with 
                the deaths of approximately 50,000 Americans annually;
                    (B) urban ozone, commonly known as ``smog'', that 
                impairs normal respiratory functions and is of special 
                concern to individuals afflicted with asthma, 
                emphysema, and other respiratory ailments;
                    (C) rural ozone that obscures visibility and 
                damages forests and wildlife;
                    (D) acid deposition that damages estuaries, lakes, 
                rivers, and streams (and the plants and animals that 
                depend on them for survival) and leaches heavy metals 
                from the soil;
                    (E) mercury and heavy metal contamination that 
                renders fish unsafe to eat, with especially serious 
                consequences for pregnant women and their fetuses;
                    (F) eutrophication of estuaries, lakes, rivers, and 
                streams; and
                    (G) global climate change that may fundamentally 
                and irreversibly alter human, animal, and plant life;
            (3) tax laws and environmental laws--
                    (A) provide a very strong incentive for electric 
                utilities to keep old, dirty, and inefficient 
                generating units in operation; and
                    (B) provide a strong disincentive to investing in 
                new, clean, and efficient generating technologies;
            (4) fossil fuel-fired power plants, consisting of plants 
        fueled by coal, fuel oil, and natural gas, produce more than 
        two-thirds of the electricity generated in the United States;
            (5) since, according to the Department of Energy, the 
        average combustion heat rate efficiency of fossil fuel-fired 
        power plants in the United States is 33 percent, 67 percent of 
        the heat generated by burning the fuel is wasted;
            (6) technology exists to increase the combustion heat rate 
        efficiency of coal combustion from 35 percent to 50 percent 
        above current levels, and technological advances are possible 
        that would boost the net combustion heat rate efficiency even 
        more;
            (7) coal-fired power plants are the leading source of 
        mercury emissions in the United States, releasing more than 43 
        tons of this potent neurotoxin each year;
            (8) in 1999, fossil fuel-fired power plants in the United 
        States produced nearly 2,200,000,000 tons of carbon dioxide, 
        the primary greenhouse gas;
            (9) on average, fossil fuel-fired power plants emit 
        approximately 2,000 pounds of carbon dioxide for every megawatt 
        hour of electricity produced;
            (10) the average fossil fuel-fired generating unit in the 
        United States commenced operation in 1964, 6 years before the 
        Clean Air Act (42 U.S.C. 7401 et seq.) was amended to establish 
        requirements for stationary sources;
            (11)(A) according to the Department of Energy, only 23 
        percent of the 1,000 largest emitting units are subject to 
        stringent new source performance standards under section 111 of 
        the Clean Air Act (42 U.S.C. 7411); and
            (B) the remaining 77 percent, commonly referred to as 
        ``grandfathered'' power plants, are subject to much less 
        stringent requirements;
            (12) according to available scientific and medical 
        evidence, exposure to mercury and mercury compounds is of 
        concern to human health and the environment;
            (13) according to the report entitled ``Toxicological 
        Effects of Methylmercury'' and submitted to Congress by the 
National Academy of Sciences in 2000, and other scientific and medical 
evidence, pregnant women and their developing fetuses, women of 
childbearing age, children, and individuals who subsist primarily on 
fish are most at risk for mercury-related health impacts such as 
neurotoxicity;
            (14) although exposure to mercury and mercury compounds 
        occurs most frequently through consumption of mercury-
        contaminated fish, such exposure can also occur through--
                    (A) ing
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estion of breast milk;
                    (B) ingestion of drinking water, and foods other 
                than fish, that are contaminated with methylmercury; 
                and
                    (C) dermal uptake through contact with soil and 
                water;
            (15) the report entitled ``Mercury Study Report to 
        Congress'' and submitted by the Environmental Protection Agency 
        under section 112(n)(1)(B) of the Clean Air Act (42 U.S.C. 
        7412(n)(1)(B)), in conjunction with other scientific knowledge, 
        supports a plausible link between mercury emissions from 
        combustion of coal and other fossil fuels and mercury 
        concentrations in air, soil, water, and sediments;
            (16)(A) the Environmental Protection Agency report 
        described in paragraph (15) supports a plausible link between 
        mercury emissions from combustion of coal and other fossil 
        fuels and methylmercury concentrations in freshwater fish;
            (B) in 2000, 41 States issued health advisories that warned 
        the public about consuming mercury-tainted fish, as compared to 
        27 States that issued such advisories in 1993; and
            (C) the number of mercury advisories nationwide increased 
        from 899 in 1993 to 2,242 in 2000, an increase of 149 percent;
            (17) pollution from power plants can be reduced through 
        adoption of modern technologies and practices, including--
                    (A) methods of combusting coal that are 
                intrinsically more efficient and less polluting, such 
                as pressurized fluidized bed combustion and an 
                integrated gasification combined cycle system;
                    (B) methods of combusting cleaner fuels, such as 
                gases from fossil and biological resources and combined 
                cycle turbines;
                    (C) treating flue gases through application of 
                pollution controls;
                    (D) methods of extracting energy from natural, 
                renewable resources of energy, such as solar and wind 
                sources;
                    (E) methods of producing electricity and thermal 
                energy from fuels without conventional combustion, such 
                as fuel cells; and
                    (F) combined heat and power methods of extracting 
                and using heat that would otherwise be wasted, for the 
                purpose of heating or cooling office buildings, 
                providing steam to processing facilities, or otherwise 
                increasing total efficiency;
            (18) adopting the technologies and practices described in 
        paragraph (17) would increase competitiveness and productivity, 
        secure employment, save lives, and preserve the future; and
            (19) accurate, long-term, nationwide monitoring of 
        atmospheric acid and mercury deposition is essential for--
                    (A) determining deposition trends;
                    (B) evaluating the local and regional transport of 
                emissions; and
                    (C) assessing the impact of emission reductions.
    (b) Purposes.--The purposes of this Act are--
            (1) to protect and preserve the environment while 
        safeguarding health by ensuring that each fossil fuel-fired 
        generating unit minimizes air pollution to levels that are 
        technologically feasible through modernization and application 
        of pollution controls;
            (2) to greatly reduce the quantities of mercury, carbon 
        dioxide, sulfur dioxide, and nitrogen oxides entering the 
        environment from combustion of fossil fuels;
            (3) to permanently reduce emissions of those pollutants by 
        increasing the combustion heat rate efficiency of fossil fuel-
        fired generating units to levels achievable through--
                    (A) use of commercially available combustion 
                technology, including clean coal technologies such as 
                pressurized fluidized bed combustion and an integrated 
                gasification combined cycle system;
                    (B) installation of pollution controls;
                    (C) expanded use of renewable and clean energy 
                sources such as biomass, geothermal, solar, wind, and 
                fuel cells; and
                    (D) promotion of application of combined heat and 
                power technologies;
            (4)(A) to create financial and regulatory incentives to 
        retire thermally inefficient generating units and replace them 
        with new units that employ high-thermal-efficiency combustion 
        technology; and
            (B) to increase use of renewable and clean energy sources 
        such as biomass, geothermal, solar, wind, and fuel cells;
            (5) to establish the Clean Air Trust Fund to fund the 
        training, economic development, carbon sequestration, and 
        research, development, and demonstration programs established 
        under this Act;
            (6) to eliminate the ``grandfather'' loophole in the Clean 
        Air Act relating to sources in operation before the 
        promulgation of standards under section 111 of that Act (42 
        U.S.C. 7411);
            (7) to express the sense of Congress that permanent 
        reductions in emissions of greenhouse gases that are 
        accomplished through the retirement of old units and 
        replacement by new units that meet the combustion heat rate 
        efficiency and emission standards specified in this Act should 
        be credited to the utility sector and the owner or operator in 
        any climate change implementation program;
            (8) to promote permanent and safe disposal of mercury 
        recovered through coal cleaning, flue gas control systems, and 
other methods of mercury pollution control;
            (9) to increase public knowledge of the sources of mercury 
        exposure and the threat to public health from mercury, 
        particularly the threat to the health of pregnant women and 
        their fetuses, women of childbearing age, and children;
            (10) to decrease significantly the threat to human health 
        and the environment posed by mercury;
            (11) to provide worker retraining for workers adversely 
        affected by reduced consumption of coal;
            (12) to provide economic development incentives for 
        communities adversely affected by reduced consumption of coal;
            (13) to promote research concerning renewable energy 
        sources, clean power generation technologies, and carbon 
        sequestration; and
            (14) to promote government accountability for compliance 
        with the Clean Air Act (42 U.S.C. 7401 et seq.) and other 
        emission reduction laws by ensuring accurate, long-term, 
        nationwide monitoring of atmospheric acid and mercury 
        deposition.

SEC. 3. DEFINITIONS.

    In this Act:
            (1) Administrator.--The term ``Administrator'' means the 
        Administrator of the Environmental Protection Agency.
            (2) Generating unit.--The term ``generating unit'' means an 
        electric utility generating unit.

SEC. 4. COMBUSTION HEAT RATE EFFICIENCY STANDARDS FOR FOSSIL FUEL-FIRED 
              GENERATING UNITS.

    (a) Standards.--
            (1) In general.--Not later than the day that is 10 years 
        after the date of enactment of this Act, each fossil fuel-fired 
        generating unit that commences operation on or before that day 
        shall achieve and maintain, at all operating levels, a 
        combustion heat rate efficiency of not less than 45 percent 
        (based on the higher heating value of the fuel).
            (2) Future generating units.--Each fossil fuel-fired 
        generating unit that commences operation more than 10 years 
        after the date of enactment of this Act shall achieve and 
        
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maintain, at all operating levels, a combustion heat rate 
        efficiency of not less than 50 percent (based on the higher 
        heating value of the fuel), unless granted a waiver under 
        subsection (d).
    (b) Test Methods.--Not later than 2 years after the date of 
enactment of this Act, the Administrator, in consultation with the 
Secretary of Energy, shall promulgate methods for determining initial 
and continuing compliance with this section.
    (c) Permit Requirement.--Not later than 10 years after the date of 
enactment of this Act, each generating unit shall have a permit issued 
under title V of the Clean Air Act (42 U.S.C. 7661 et seq.) that 
requires compliance with this section.
    (d) Waiver of Combustion Heat Rate Efficiency Standard.--
            (1) Application.--The owner or operator of a generating 
        unit that commences operation more than 10 years after the date 
        of enactment of this Act may apply to the Administrator for a 
        waiver of the combustion heat rate efficiency standard 
        specified in subsection (a)(2) that is applicable to that type 
        of generating unit.
            (2) Issuance.--The Administrator may grant the waiver only 
        if--
                    (A)(i) the owner or operator of the generating unit 
                demonstrates that the technology to meet the combustion 
                heat rate efficiency standard is not commercially 
                available; or
                    (ii) the owner or operator of the generating unit 
                demonstrates that, despite best technical efforts and 
                willingness to make the necessary level of financial 
                commitment, the combustion heat rate efficiency 
                standard is not achievable at the generating unit; and
                    (B) the owner or operator of the generating unit 
                enters into an agreement with the Administrator to 
                offset by a factor of 1.5 to 1, using a method approved 
                by the Administrator, the emission reductions that the 
                generating unit does not achieve because of the failure 
                to achieve the combustion heat rate efficiency standard 
                specified in subsection (a)(2).
            (3) Effect of waiver.--If the Administrator grants a waiver 
        under paragraph (1), the generating unit shall be required to 
        achieve and maintain, at all operating levels, the combustion 
        heat rate efficiency standard specified in subsection (a)(1).

SEC. 5. AIR EMISSION STANDARDS FOR FOSSIL FUEL-FIRED GENERATING UNITS.

    (a) All Fossil Fuel-Fired Generating Units.--Not later than 10 
years after the date of enactment of this Act, each fossil fuel-fired 
generating unit, regardless of its date of construction or commencement 
of operation, shall be subject to, and operating in physical and 
operational compliance with, the new source review requirements under 
section 111 of the Clean Air Act (42 U.S.C. 7411).
    (b) Emission Rates for Sources Required To Maintain 45 Percent 
Efficiency.--Not later than 10 years after the date of enactment of 
this Act, each fossil fuel-fired generating unit subject to section 
4(a)(1) shall be in compliance with the following emission limitations:
            (1) Mercury.--Each coal-fired or fuel oil-fired generating 
        unit shall be required to remove 90 percent of the mercury 
        contained in the fuel, calculated in accordance with subsection 
        (e).
            (2) Carbon dioxide.--
                    (A) Natural gas-fired generating units.--Each 
                natural gas-fired generating unit shall be required to 
                achieve an emission rate of not more than 0.9 pounds of 
                carbon dioxide per kilowatt hour of net electric power 
                output.
                    (B) Fuel oil-fired generating units.--Each fuel 
                oil-fired generating unit shall be required to achieve 
                an emission rate of not more than 1.3 pounds of carbon 
                dioxide per kilowatt hour of net electric power output.
                    (C) Coal-fired generating units.--Each coal-fired 
                generating unit shall be required to achieve an 
                emission rate of not more than 1.55 pounds of carbon 
                dioxide per kilowatt hour of net electric power output.
            (3) Sulfur dioxide.--Each fossil fuel-fired generating unit 
        shall be required--
                    (A) to remove 95 percent of the sulfur dioxide that 
                would otherwise be present in the flue gas; and
                    (B) to achieve an emission rate of not more than 
                0.3 pounds of sulfur dioxide per million British 
                thermal units of fuel consumed.
            (4) Nitrogen oxides.--Each fossil fuel-fired generating 
        unit shall be required--
                    (A) to remove 90 percent of nitrogen oxides that 
                would otherwise be present in the flue gas; and
                    (B) to achieve an emission rate of not more than 
                0.15 pounds of nitrogen oxides per million British 
                thermal units of fuel consumed.
    (c) Emission Rates for Sources Required To Maintain 50 Percent 
Efficiency.--Each fossil fuel-fired generating unit subject to section 
4(a)(2) shall be in compliance with the following emission limitations:
            (1) Mercury.--Each coal-fired or fuel oil-fired generating 
        unit shall be required to remove 90 percent of the mercury 
        contained in the fuel, calculated in accordance with subsection 
        (e).
            (2) Carbon dioxide.--
                    (A) Natural gas-fired generating units.--Each 
                natural gas-fired generating unit shall be required to 
                achieve an emission rate of not more than 0.8 pounds of 
                carbon dioxide per kilowatt hour of net electric power 
                output.
                    (B) Fuel oil-fired generating units.--Each fuel 
                oil-fired generating unit shall be required to achieve 
                an emission rate of not more than 1.2 pounds of carbon 
                dioxide per kilowatt hour of net electric power output.
                    (C) Coal-fired generating units.--Each coal-fired 
                generating unit shall be required to achieve an 
                emission rate of not more than 1.4 pounds of carbon 
                dioxide per kilowatt hour of net electric power output.
            (3) Sulfur dioxide.--Each fossil fuel-fired generating unit 
        shall be required--
                    (A) to remove 95 percent of the sulfur dioxide that 
                would otherwise be present in the flue gas; and
                    (B) to achieve an emission rate of not more than 
                0.3 pounds of sulfur dioxide per million British 
                thermal units of fuel consumed.
            (4) Nitrogen oxides.--Each fossil fuel-fired generating 
        unit shall be required--
                    (A) to remove 90 percent of nitrogen oxides that 
                would otherwise be present in the flue gas; and
                    (B) to achieve an emission rate of not more than 
                0.15 pounds of nitrogen oxides per million British 
                thermal units of fuel consumed.
    (d) Permit Requirement.--Not later than 10 years after the date of 
enactment of this Act, each generating unit shall have a permit issued 
under title V of the Clean Air Act (42 U.S.C. 7661 et seq.) that 
requires compliance with this section.
    (e) Compliance Determination and Monitoring.--
            (1) Regulations.--Not later than 2 years after the date of 
        enactment of this Act, the Administrator, in consultation with 
        the Secretary of Energy, shall promulgate methods for 
        determining initial and continuing compliance with this 
        section.
            (2) Calculation of mercury emission reductions.--Not later 
        than 2 years afte
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r the date of enactment of this Act, the 
        Administrator shall promulgate fuel sampling techniques and 
        emission monitoring techniques for use by generating units in 
        calculating mercury emission reductions for the purposes of 
        this section.
            (3) Reporting.--
                    (A) In general.--Not less often than quarterly, the 
                owner or operator of a generating unit shall submit a 
                pollutant-specific emission report for each pollutant 
                covered by this section.
                    (B) Signature.--Each report required under 
                subparagraph (A) shall be signed by a responsible 
                official of the generating unit, who shall certify the 
                accuracy of the report.
                    (C) Public reporting.--The Administrator shall 
                annually make available to the public, through 1 or 
                more published reports and 1 or more forms of 
                electronic media, facility-specific emission data for 
                each generating unit and pollutant covered by this 
                section.
                    (D) Consumer disclosure.--Not later than 2 years 
                after the date of enactment of this Act, the 
                Administrator shall promulgate regulations requiring 
                each owner or operator of a generating unit to disclose 
                to residential consumers of electricity generated by 
                the unit, on a regular basis (but not less often than 
                annually) and in a manner convenient to the consumers, 
                data concerning the level of emissions by the 
                generating unit of each pollutant covered by this 
                section and each air pollutant covered by section 111 
                of the Clean Air Act (42 U.S.C. 7411).
    (f) Disposal of Mercury Captured or Recovered Through Emission 
Controls.--
            (1) Captured or recovered mercury.--Not later than 2 years 
        after the date of enactment of this Act, the Administrator 
        shall promulgate regulations to ensure that mercury that is 
        captured or recovered through the use of an emission control, 
        coal cleaning, or another method is disposed of in a manner 
        that ensures that--
                    (A) the hazards from mercury are not transferred 
                from 1 environmental medium to another; and
                    (B) there is no release of mercury into the 
                environment.
            (2) Mercury-containing sludges and wastes.--The regulations 
        promulgated by the Administrator under paragraph (1) shall 
        ensure that mercury-containing sludges and wastes are handled 
and disposed of in accordance with all applicable Federal and State 
laws (including regulations).
    (g) Public Reporting of Facility-Specific Emission Data.--
            (1) In general.--The Administrator shall annually make 
        available to the public, through 1 or more published reports 
        and the Internet, facility-specific emission data for each 
        generating unit and for each pollutant covered by this section.
            (2) Source of data.--The emission data shall be taken from 
        the emission reports submitted under subsection (e)(3).

SEC. 6. EXTENSION OF RENEWABLE ENERGY PRODUCTION CREDIT.

    Section 45(c) of the Internal Revenue Code of 1986 (relating to 
definitions) is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (B), by striking ``and'';
                    (B) in subparagraph (C), by striking the period and 
                inserting a comma; and
                    (C) by adding at the end the following:
                    ``(D) solar power, and
                    ``(E) geothermal power.'';
            (2) in paragraph (3)--
                    (A) in subparagraph (A), by striking ``2002'' and 
                inserting ``2016'';
                    (B) in subparagraph (B), by striking ``2002'' and 
                inserting ``2016'';
                    (C) in subparagraph (C), by striking ``2002'' and 
                inserting ``2016''; and
                    (D) by adding at the end the following:
                    ``(D) Solar power facility.--In the case of a 
                facility using solar power to produce electricity, the 
                term `qualified facility' means any facility owned by 
                the taxpayer which is originally placed in service 
                after December 31, 2001, and before January 1, 2016.
                    ``(E) Geothermal power facility.--In the case of a 
                facility using geothermal power to produce electricity, 
                the term `qualified facility' means any facility owned 
                by the taxpayer which is originally placed in service 
                after December 31, 2001, and before January 1, 2016.''; 
                and
            (3) by adding at the end the following:
            ``(5) Solar power.--The term `solar power' means solar 
        energy harnessed through photovoltaic systems, solar boilers 
        which provide process heat, and any other means.
            ``(6) Geothermal power.--The term `geothermal power' means 
        thermal energy extracted from the earth for the purposes of 
        producing electricity.''.

SEC. 7. MEGAWATT HOUR GENERATION FEES.

    (a) In General.--Chapter 38 of the Internal Revenue Code of 1986 
(relating to miscellaneous excise taxes) is amended by inserting after 
subchapter D the following:

             ``Subchapter E--Megawatt Hour Generation Fees

                              ``Sec. 4691. Imposition of fees.

``SEC. 4691. IMPOSITION OF FEES.

    ``(a) Tax Imposed.--There is hereby imposed on each covered fossil 
fuel-fired generating unit a tax equal to 30 cents per megawatt hour of 
electricity produced by the covered fossil fuel-fired generating unit.
    ``(b) Adjustment of Rates.--Not less often than once every 2 years 
beginning after 2005, the Secretary, in consultation with the 
Administrator of the Environmental Protection Agency, shall evaluate 
the rate of the tax imposed by subsection (a) and increase the rate if 
necessary for any succeeding calendar year to ensure that the Clean Air 
Trust Fund established by section 9511 has sufficient amounts to fully 
fund the activities described in section 9511(c).
    ``(c) Payment of Tax.--The tax imposed by this section shall be 
paid quarterly by the owner or operator of each covered fossil fuel-
fired generating unit.
    ``(d) Covered Fossil Fuel-Fired Generating Unit.--The term `covered 
fossil fuel-fired generating unit' means an electric utility generating 
unit which--
            ``(1) is powered by fossil fuels;
            ``(2) has a generating capacity of 5 or more megawatts; and
            ``(3) because of the date on which the generating unit 
        commenced commercial operation, is not subject to all 
        regulations promulgated under section 111 of the Clean Air Act 
        (42 U.S.C. 7411).''.
    (b) Conforming Amendment.--The table of subchapters for such 
chapter 38 is amended by inserting after the item relating to 
subchapter D the following:

                              ``Subchapter E. Megawatt hour generation 
                                        fees.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to electricity produced in calendar years beginning after 
December 31, 2003.

SEC. 8. CLEAN AIR TRUST FUND.

    (a) In General.--Subchapter A of chapter 98 of the Internal Revenue 
Code of 1986 (relating to trust fund code) is amended by adding at the 
end the following:

``SEC. 9511. CLEAN AIR TRUST FUND.

    ``(a) Creation of Trust Fund.--There is established in the Treasury 
of the United States a trust fund to be known as the `Clean Air Trust 
Fund' (hereafter referred to in this section as the `Trust Fund'), 
consisting of such amounts as may be appropriated or credited to the 
Trust Fund as provided in this section or section 960
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2(b).
    ``(b) Transfers to Trust Fund.--There are hereby appropriated to 
the Trust Fund amounts equivalent to the taxes received in the Treasury 
under section 4691.
    ``(c) Expenditures From Trust Fund.--Amounts in the Trust Fund 
shall be available, without further Act of appropriation, upon request 
by the head of the appropriate Federal agency in such amounts as the 
agency head determines are necessary--
            ``(1) to provide funding under section 12 of the Clean 
        Power Plant and Modernization Act of 2001, as in effect on the 
        date of enactment of this section;
            ``(2) to provide funding for the demonstration program 
        under section 13 of such Act, as so in effect;
            ``(3) to provide assistance under section 15 of such Act, 
        as so in effect;
            ``(4) to provide assistance under section 16 of such Act, 
        as so in effect; and
            ``(5) to provide funding under section 17 of such Act, as 
        so in effect.''.
    (b) Conforming Amendment.--The table of sections for such 
subchapter A is amended by adding at the end the following:

                              ``Sec. 9511. Clean Air Trust Fund.''.

SEC. 9. ACCELERATED DEPRECIATION FOR INVESTOR-OWNED GENERATING UNITS.

    (a) In General.--Section 168(e)(3) of the Internal Revenue Code of 
1986 (relating to classification of certain property) is amended--
            (1) in subparagraph (E) (relating to 15-year property), by 
        striking ``and'' at the end of clause (ii), by striking the 
        period at the end of clause (iii) and inserting ``, and'', and 
        by adding at the end the following:
                            ``(iv) any 45-percent efficient fossil 
                        fuel-fired generating unit.''; and
            (2) by adding at the end the following:
                    ``(F) 12-year property.--The term `12-year 
                property' includes any 50-percent efficient fossil 
                fuel-fired generating unit.''.
    (b) Definitions.--Section 168(i) of the Internal Revenue Code of 
1986 (relating to definitions and special rules) is amended by adding 
at the end the following:
            ``(15) Fossil fuel-fired generating units.--
                    ``(A) 50-percent efficient fossil fuel-fired 
                generating unit.--The term `50-percent efficient fossil 
                fuel-fired generating unit' means any property used in 
                an investor-owned fossil fuel-fired generating unit 
                pursuant to a plan approved by the Secretary, in 
                consultation with the Administrator of the 
                Environmental Protection Agency, to place into service 
                such a unit which is in compliance with sections 
                4(a)(2) and 5(c) of the Clean Power Plant and 
                Modernization Act of 2001, as in effect on the date of 
                enactment of this paragraph.
                    ``(B) 45-percent efficient fossil fuel-fired 
                generating unit.--The term `45-percent efficient fossil 
                fuel-fired generating unit' means any property used in 
                an investor-owned fossil fuel-fired generating unit 
                pursuant to a plan so approved to place into service 
                such a unit which is in compliance with sections 
                4(a)(1) and 5(b) of such Act, as so in effect.''.
    (c) Conforming Amendment.--The table contained in section 168(c) of 
the Internal Revenue Code of 1986 (relating to applicable recovery 
period) is amended by inserting after the item relating to 10-year 
property the following:

    ``12-year property............................         12 years''. 
    (d) Effective Date.--The amendments made by this section shall 
apply to property used after the date of enactment of this Act.

SEC. 10. GRANTS FOR PUBLICLY OWNED GENERATING UNITS.

    Any capital expenditure made after the date of enactment of this 
Act to purchase, install, and bring into commercial operation any new 
publicly owned generating unit that--
            (1) is in compliance with sections 4(a)(1) and 5(b) shall, 
        for a 15-year period, be eligible for partial reimbursement 
        through annual grants made by the Secretary of the Treasury, in 
        consultation with the Administrator, in an amount equal to the 
        monetary value of the depreciation deduction that would be 
        realized by reason of section 168(c)(3)(E) of the Internal 
        Revenue Code of 1986 by a similarly-situated investor-owned 
        generating unit over that period; and
            (2) is in compliance with sections 4(a)(2) and 5(c) shall, 
        over a 12-year period, be eligible for partial reimbursement 
        through annual grants made by the Secretary of the Treasury, in 
        consultation with the Administrator, in an amount equal to the 
        monetary value of the depreciation deduction that would be 
        realized by reason of section 168(c)(3)(D) of such Code by a 
        similarly-situated investor-owned generating unit over that 
        period.

SEC. 11. RECOGNITION OF PERMANENT EMISSION REDUCTIONS IN FUTURE CLIMATE 
              CHANGE IMPLEMENTATION PROGRAMS.

    It is the sense of Congress that--
            (1) permanent reductions in emissions of carbon dioxide and 
        nitrogen oxides that are accomplished through the retirement of 
        old generating units and replacement by new generating units 
        that meet the combustion heat rate efficiency and emission 
        standards specified in this Act, or through replacement of old 
        generating units with nonpolluting renewable power generation 
        technologies, should be credited to the utility sector, and to 
        the owner or operator that retires or replaces the old 
        generating unit, in any climate change implementation program 
        enacted by Congress;
            (2) the base year for calculating reductions under a 
        program described in paragraph (1) should be the calendar year 
        preceding the calendar year in which this Act is enacted; and
            (3) a reasonable portion of any monetary value that may 
        accrue from the crediting described in paragraph (1) should be 
        passed on to utility customers.

SEC. 12. RENEWABLE AND CLEAN POWER GENERATION TECHNOLOGIES.

    (a) In General.--Under the Renewable Energy and Energy Efficiency 
Technology Act of 1989 (42 U.S.C. 12001 et seq.), the Secretary of 
Energy shall fund research and development programs and commercial 
demonstration projects and partnerships to demonstrate the commercial 
viability and environmental benefits of electric power generation 
from--
            (1) biomass (excluding unseparated municipal solid waste), 
        geothermal, solar, and wind technologies; and
            (2) fuel cells.
    (b) Types of Projects.--Demonstration projects may include solar 
power tower plants, solar dishes and engines, co-firing of biomass with 
coal, biomass modular systems, next-generation wind turbines and wind 
turbine verification projects, geothermal energy conversion, and fuel 
cells.
    (c) Authorization of Appropriations.--In addition to amounts made 
available under any other law, there is authorized to be appropriated 
to carry out this section $75,000,000 for each of fiscal years 2003 
through 2012.

SEC. 13. CLEAN COAL, ADVANCED GAS TURBINE, AND COMBINED HEAT AND POWER 
              DEMONSTRATION PROGRAM.

    (a) In General.--Under subtitle B of title XXI of the Energy Policy 
Act of 1992 (42 U.S.C. 13471 et seq.), the Secretary of Energy shall 
establish a program to fund projects and partnerships designed to 
demonstrate the efficiency and environmental benefits of electric power 
generation from--
            (1) clean coal technologies, such as pressurized fluidized 
        bed combustion and an integrated gasification combined cycle 
        system;
            (2) advanced gas turbine technologies, such as flexible 
        midsized gas turbines and baseload utility scale applications; 
 
1edf
       and
            (3) combined heat and power technologies.
    (b) Selection Criteria.--
            (1) In general.--Not later than 1 year after the date of 
        enactment of this Act, the Secretary of Energy shall promulgate 
        criteria and procedures for selection of demonstration projects 
        and partnerships to be funded under subsection (a).
            (2) Required criteria.--At a minimum, the selection 
        criteria shall include--
                    (A) the potential of a proposed demonstration 
                project or partnership to reduce or avoid emissions of 
                pollutants covered by section 5 and air pollutants 
                covered by section 111 of the Clean Air Act (42 U.S.C. 
                7411); and
                    (B) the potential commercial viability of the 
                proposed demonstration project or partnership.
    (c) Authorization of Appropriations.--
            (1) In general.--In addition to amounts made available 
        under any other law, there is authorized to be appropriated to 
        carry out this section $75,000,000 for each of fiscal years 
        2003 through 2012.
            (2) Distribution.--The Secretary shall make reasonable 
        efforts to ensure that, under the program established under 
        this section, the same amount of funding is provided for 
        demonstration projects and partnerships under each of 
        paragraphs (1), (2), and (3) of subsection (a).

SEC. 14. EVALUATION OF IMPLEMENTATION OF THIS ACT AND OTHER STATUTES.

    (a) In General.--Not later than 2 years after the date of enactment 
of this Act, the Secretary of Energy, in consultation with the Chairman 
of the Federal Energy Regulatory Commission and the Administrator, 
shall submit to Congress a report on the implementation of this Act.
    (b) Identification of Conflicting Law.--The report shall identify 
any provision of the Energy Policy Act of 1992 (Public Law 102-486), 
the Energy Supply and Environmental Coordination Act of 1974 (15 U.S.C. 
791 et seq.), the Public Utility Regulatory Policies Act of 1978 (16 
U.S.C. 2601 et seq.), or the Powerplant and Industrial Fuel Use Act of 
1978 (42 U.S.C. 8301 et seq.), or the amendments made by those Acts, 
that conflicts with the intent or efficient implementation of this Act.
    (c) Recommendations.--The report shall include recommendations from 
the Secretary of Energy, the Chairman of the Federal Energy Regulatory 
Commission, and the Administrator for legislative or administrative 
measures to harmonize and streamline the statutes specified in 
subsection (b) and the regulations implementing those statutes.

SEC. 15. ASSISTANCE FOR WORKERS ADVERSELY AFFECTED BY REDUCED 
              CONSUMPTION OF COAL.

    In addition to amounts made available under any other law, there is 
authorized to be appropriated $75,000,000 for each of fiscal years 2003 
through 2015 to provide assistance, under the economic dislocation and 
worker adjustment assistance program of the Department of Labor 
authorized by title III of the Job Training Partnership Act (29 U.S.C. 
1651 et seq.), to coal industry workers who are terminated from 
employment as a result of reduced consumption of coal by the electric 
power generation industry.

SEC. 16. COMMUNITY ECONOMIC DEVELOPMENT INCENTIVES FOR COMMUNITIES 
              ADVERSELY AFFECTED BY REDUCED CONSUMPTION OF COAL.

    In addition to amounts made available under any other law, there is 
authorized to be appropriated $75,000,000 for each of fiscal years 2003 
through 2012 to provide assistance, under the economic adjustment 
program of the Department of Commerce authorized by the Public Works 
and Economic Development Act of 1965 (42 U.S.C. 3121 et seq.), to 
assist communities adversely affected by reduced consumption of coal by 
the electric power generation industry.

SEC. 17. CARBON SEQUESTRATION.

    (a) Carbon Sequestration Strategy.--In addition to amounts made 
available under any other law, there is authorized to be appropriated 
to the Environmental Protection Agency and the Department of Energy for 
each of fiscal years 2003 through 2005 a total of $15,000,000 to 
conduct research and development activities in basic and applied 
science in support of development by September 30, 2005, of a carbon 
sequestration strategy that is designed to offset all growth in carbon 
dioxide emissions in the United States after 2010.
    (b) Methods for Biologically Sequestering Carbon Dioxide.--In 
addition to amounts made available under any other law, there is 
authorized to be appropriated to the Environmental Protection Agency 
and the Department of Agriculture for each of fiscal years 2003 through 
2012 a total of $30,000,000 to carry out soil restoration, tree 
planting, wetland protection, and other methods of biologically 
sequestering carbon dioxide.
    (c) Limitation.--A project carried out using funds made available 
under this section shall not be used to offset any emission reduction 
required under any other provision of this Act.

SEC. 18. ATMOSPHERIC MONITORING.

    (a) Operational Support.--In addition to amounts made available 
under any other law, there are authorized to be appropriated for each 
of fiscal years 2003 through 2012--
            (1) for operational support of the National Atmospheric 
        Deposition Program National Trends Network--
                    (A) $2,000,000 to the United States Geological 
                Survey;
                    (B) $600,000 to the Environmental Protection 
                Agency;
                    (C) $600,000 to the National Park Service; and
                    (D) $400,000 to the Forest Service;
            (2) for operational support of the National Atmospheric 
        Deposition Program Mercury Deposition Network--
                    (A) $400,000 to the Environmental Protection 
                Agency;
                    (B) $400,000 to the United States Geological 
                Survey;
                    (C) $100,000 to the National Oceanic and 
                Atmospheric Administration; and
                    (D) $100,000 to the National Park Service;
            (3) for the National Atmospheric Deposition Program 
        Atmospheric Integrated Research Monitoring Network $1,500,000 
        to the National Oceanic and Atmospheric Administration;
            (4) for the Clean Air Status and Trends Network $5,000,000 
        to the Environmental Protection Agency; and
            (5) for the Temporally Integrated Monitoring of Ecosystems 
        and Long-Term Monitoring Program $2,500,000 to the 
        Environmental Protection Agency.
    (b) Modernization.--In addition to amounts made available under any 
other law, there are authorized to be appropriated--
            (1) for equipment and site modernization of the National 
        Atmospheric Deposition Program National Trends Network 
        $6,000,000 to the Environmental Protection Agency;
            (2) for equipment and site modernization and network 
        expansion of the National Atmospheric Deposition Program 
        Mercury Deposition Network $2,000,000 to the Environmental 
        Protection Agency;
            (3) for equipment and site modernization and network 
        expansion of the National Atmospheric Deposition Program 
        Atmospheric Integrated Research Monitoring Network $1,000,000 
        to the National Oceanic and Atmospheric Administration; and
            (4) for equipment and site modernization and network 
        expansion of the Clean Air Status and Trends Network $4,600,000 
        to the Environmental Protection Agency.
    (c) Availability of Amounts.--Each of the amounts appropriated 
under subsection (b) shall remain available until expended.
                                 &lt;all&gt;

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