Clean Energy for America Act

II Calendar No. 78 117TH CONGRESS 1ST SESSION S. 2118 To amend the Internal Revenue Code of 1986 to provide tax incentives for increased investment in clean energy, and for other purposes. IN THE SENATE OF THE UNITED STATES JUNE 17, 2021 Mr. WYDEN (for himself, Ms. STABENOW, Mr. MENENDEZ, Mr. CARPER, Mr. CARDIN, Mr. BROWN, Mr. BENNET, Mr. CASEY, Mr. WHITEHOUSE, and Ms. CORTEZ MASTO) introduced the following bill; which was read the first time JUNE 21, 2021 Read the second time and placed on the calendar A BILL To amend the Internal Revenue Code of 1986 to provide tax incentives for increased investment in clean energy, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE; ETC. 3 (a) SHORT TITLE.—This Act may be cited as the 4 ‘‘Clean Energy for America Act’’. 5 VerDate Sep 11 2014 00:26 Jun 22, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.PCS S2118 kjohnson on DSK79L0C42PROD with BILLS 2 •S 2118 PCS (b) AMENDMENT OF 1986 CODE.—Except as other- 1 wise expressly provided, whenever in this Act an amend- 2 ment or repeal is expressed in terms of an amendment 3 to, or repeal of, a section or other provision, the reference 4 shall be considered to be made to a section or other provi- 5 sion of the Internal Revenue Code of 1986. 6 (c) TABLE OF CONTENTS.—The table of contents of 7 this Act is as follows: 8 Sec. 1. Short title; etc. TITLE I—INCENTIVES FOR CLEAN ELECTRICITY Sec. 101. Clean electricity production credit. Sec. 102. Clean electricity investment credit. Sec. 103. Extensions, modifications, and terminations of various energy provi- sions. TITLE II—INCENTIVES FOR CLEAN TRANSPORTATION Sec. 201. Clean fuel production credit. Sec. 202. Transportation electrification. Sec. 203. Credit for production of clean hydrogen. Sec. 204. Temporary extensions of existing fuel incentives. TITLE III—INCENTIVES FOR ENERGY EFFICIENCY Sec. 301. Credit for new energy efficient residential buildings. Sec. 302. Energy efficient home improvement credit. Sec. 303. Enhancement of energy efficient commercial buildings deduction. Sec. 304. Enhancement of energy credit for geothermal heat pumps. TITLE IV—TERMINATION OF CERTAIN FOSSIL FUEL PROVISIONS Sec. 401. Termination of provisions relating to oil, gas, and other materials. Sec. 402. Modification of certain provisions relating to oil, gas, and other fossil fuels. TITLE V—WORKFORCE DEVELOPMENT REQUIREMENTS Sec. 501. Use of qualified apprentices. TITLE VI—MISCELLANEOUS Sec. 601. Adjustment of qualifying advanced energy project credit. Sec. 602. Issuance of exempt facility bonds for qualified carbon dioxide capture facilities. Sec. 603. Limitation on importation of certain energy equipment and compo- nents. VerDate Sep 11 2014 00:26 Jun 22, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6211 E:\BILLS\S2118.PCS S2118 kjohnson on DSK79L0C42PROD with BILLS 3 •S 2118 PCS Sec. 604. Elimination of negative effects on small businesses and certain indi- vidual taxpayers. TITLE I—INCENTIVES FOR 1 CLEAN ELECTRICITY 2 SEC. 101. CLEAN ELECTRICITY PRODUCTION CREDIT. 3 (a) IN GENERAL.—Subpart D of part IV of sub- 4 chapter A of chapter 1 is amended by adding at the end 5 the following new section: 6 ‘‘SEC. 45U. CLEAN ELECTRICITY PRODUCTION CREDIT. 7 ‘‘(a) AMOUNT OF CREDIT.—For purposes of section 8 38, the clean electricity production credit for any taxable 9 year is an amount equal to the product of— 10 ‘‘(1) subject to subsection (g)(7), 1.5 cents, 11 multiplied by 12 ‘‘(2) the kilowatt hours of electricity— 13 ‘‘(A) produced by the taxpayer at a quali- 14 fied facility, and 15 ‘‘(B)(i) sold by the taxpayer to an unre- 16 lated person during the taxable year, or 17 ‘‘(ii) in the case of a qualified facility 18 which is equipped with a metering device which 19 is owned and operated by an unrelated person, 20 sold, consumed, or stored by the taxpayer dur- 21 ing the taxable year. 22 ‘‘(b) QUALIFIED FACILITY.— 23 ‘‘(1) IN GENERAL.— 24 VerDate Sep 11 2014 00:26 Jun 22, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.PCS S2118 kjohnson on DSK79L0C42PROD with BILLS 4 •S 2118 PCS ‘‘(A) DEFINITION.—Subject to subpara- 1 graphs (B), (C), and (D), the term ‘qualified 2 facility’ means a facility owned by the tax- 3 payer— 4 ‘‘(i) which is used for the generation 5 of electricity, 6 ‘‘(ii) which is originally placed in serv- 7 ice after December 31, 2022, 8 ‘‘(iii) for which the greenhouse gas 9 emissions rate (as determined under para- 10 graph (2)) is not greater than zero, and 11 ‘‘(iv) in the case of any facility with a 12 maximum net output equal to or greater 13 than 1 megawatt, which— 14 ‘‘(I) subject to subparagraph (B) 15 of paragraph (3), satisfies the require- 16 ments under subparagraph (A) of 17 such paragraph, and 18 ‘‘(II) with respect to the con- 19 struction of such facility, satisfies the 20 requirements under section 501 of the 21 Clean Energy for America Act. 22 ‘‘(B) 10-YEAR PRODUCTION CREDIT.—For 23 purposes of this section, a facility shall only be 24 treated as a qualified facility during the 10-year 25 VerDate Sep 11 2014 00:26 Jun 22, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.PCS S2118 kjohnson on DSK79L0C42PROD with BILLS 5 •S 2118 PCS period beginning on the date the facility was 1 originally placed in service. 2 ‘‘(C) EXPANSION OF FACILITY; INCRE- 3 MENTAL PRODUCTION.—The term ‘qualified fa- 4 cility’ shall include either of the following in 5 connection with a facility described in subpara- 6 graph (A) (without regard to clause (ii) of such 7 subparagraph) that was placed in service before 8 January 1, 2023, but only to the extent of the 9 increased amount of electricity produced at the 10 facility by reason of the following: 11 ‘‘(i) A new unit placed in service after 12 December 31, 2022. 13 ‘‘(ii) Any efficiency improvements or 14 additions of capacity placed in service after 15 December 31, 2022. 16 ‘‘(D) COORDINATION WITH OTHER CRED- 17 ITS.—The term ‘qualified facility’ shall not in- 18 clude any facility for which a credit determined 19 under section 45, 45J, 45Q, 48, or 48D is al- 20 lowed under section 38 for the taxable year or 21 any prior taxable year. 22 ‘‘(2) GREENHOUSE GAS EMISSIONS RATE.— 23 ‘‘(A) IN GENERAL.—For purposes of this 24 section, the term ‘greenhouse gas emissions 25 VerDate Sep 11 2014 00:26 Jun 22, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.PCS S2118 kjohnson on DSK79L0C42PROD with BILLS 6 •S 2118 PCS rate’ means the amount of greenhouse gases 1 emitted into the atmosphere by a facility in the 2 production of electricity, expressed as grams of 3 CO2e per KWh. 4 ‘‘(B) FUEL COMBUSTION AND GASIFI- 5 CATION.—In the case of a facility which pro- 6 duces electricity through combustion or gasifi- 7 cation, the greenhouse gas emissions rate for 8 such facility shall be equal to the net rate of 9 greenhouse gases emitted into the atmosphere 10 by such facility (taking into account lifecycle 11 greenhouse gas emissions, as described in sec- 12 tion 211(o)(1)(H) of the Clean Air Act (42 13 U.S.C. 7545(o)(1)(H))) in the production of 14 electricity, expressed as grams of CO2e per 15 KWh. 16 ‘‘(C) ESTABLISHMENT OF EMISSIONS 17 RATES FOR FACILITIES.— 18 ‘‘(i) IN GENERAL.—The Secretary and 19 the Administrator of the Environmental 20 Protection Agency shall establish green- 21 house gas emissions rates for types or cat- 22 egories of facilities, which a taxpayer shall 23 use for purposes of this section. 24 VerDate Sep 11 2014 00:26 Jun 22, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.PCS S2118 kjohnson on DSK79L0C42PROD with BILLS 7 •S 2118 PCS ‘‘(ii) PUBLISHING EMISSIONS 1 RATES.—The Secretary shall annually pub- 2 lish a table that sets forth the greenhouse 3 gas emissions rates for similar types or 4 categories of facilities. 5 ‘‘(iii) PROVISIONAL EMISSIONS 6 RATE.— 7 ‘‘(I) IN GENERAL.—In the case 8 of any facility for which an emissions 9 rate has not been established by the 10 Secretary and the Administrator of 11 the Environmental Protection Agency, 12 a taxpayer which owns such facility 13 may file a petition with the Secretary 14 and the Administrator of the Environ- 15 mental Protection Agency for deter- 16 mination of the emissions rate with 17 respect to such facility. 18 ‘‘(II) ESTABLISHMENT OF PROVI- 19 SIONAL AND FINAL EMISSIONS 20 RATE.—In the case of a facility for 21 which a petition described in sub- 22 clause (I) has been filed, the Sec- 23 retary and the Administrator of the 24 VerDate Sep 11 2014 00:26 Jun 22, 2021 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.PCS S2118 kjohnson on DSK79L0C42PROD with BILLS 8 •S 2118 PCS Environmental Protection Agency 1 shall— 2 ‘‘(aa) not later than 12 3 months after the date on which 4 the petition was filed, provide a 5 provisional emissions rate for 6 such facility which a taxpayer 7 shall use for purposes of this sec- 8 tion, and 9 ‘‘(bb) not later than 24 10 months after the date on which 11 the petition was filed, establish 12 the emissions rate for such facil- 13 ity. 14 ‘‘(D) CARBON CAPTURE AND SEQUESTRA- 15 TION EQUIPMENT.—For purposes of this sub- 16 section, the amount of greenhouse gases emit- 17 ted into the atmosphere by a facility in the pro- 18 duction of electricity shall not include any quali- 19 fied carbon dioxide that is captured by the tax- 20 payer and— 21 ‘‘(i) pursuant to any regulations es- 22 tablished under paragraph (2) of section 23 45Q(f), disposed of by the taxpayer in se- 24 cure geological storage, or 25 VerDate Sep 11 2014 00:26 Jun 22, 2021 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.PCS S2118 kjohnson on DSK79L0C42PROD with BILLS 9 •S 2118 PCS ‘‘(ii) utilized by the taxpayer in a 1 manner described in paragraph (5) of such 2 section. 3 ‘‘(3) WAGE REQUIREMENTS.— 4 ‘‘(A) IN GENERAL.—The requirements de- 5 scribed in this subparagraph with respect to 6 any facility are that the taxpayer shall ensure 7 that any laborers and mechanics employed by 8 contractors and subcontractors in— 9 ‘‘(i) the construction of such facility, 10 or 11 ‘‘(ii) for any year during the period 12 described in paragraph (1)(B), the alter- 13 ation or repair of such facility, 14 shall be paid wages at rates not less than the 15 prevailing rates for construction, alteration, or 16 repair of a similar character in the locality as 17 determined by the Secretary of Labor, in ac- 18 cordance with subchapter IV of chapter 31 of 19 title 40, United States Code. 20 ‘‘(B) FAILURE TO SATISFY WAGE RE- 21 QUIREMENTS.— 22 ‘‘(i) IN GENERAL.—In the case of any 23 taxpayer which fails to satisfy the require- 24 ment under subparagraph (A) with respect 25 VerDate Sep 11 2014 00:26 Jun 22, 2021 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.PCS S2118 kjohnson on DSK79L0C42PROD with BILLS 10 •S 2118 PCS to any facility for any year during the pe- 1 riod described in paragraph (1)(B), the 2 amount of the credit which would (but for 3 this subparagraph) be allowable under this 4 section with respect to such facility for 5 such year shall be reduced to zero. 6 ‘‘(ii) CORRECTION AND PENALTY.— 7 Clause (i) shall not apply with respect to 8 any failure by the taxpayer to satisfy the 9 requirement under subparagraph (A) with 10 respect to any facility for any year if, with 11 respect to any laborer or mechanic who 12 was paid wages at a rate below the rate 13 described in such subparagraph for any pe- 14 riod during such year, such taxpayer— 15 ‘‘(I) makes payment to such la- 16 borer or mechanic in an amount equal 17 to the sum of— 18 ‘‘(aa) an amount equal to 19 the difference between— 20 ‘‘(AA) the amount of 21 wages paid to such laborer 22 or mechanic during such pe- 23 riod, and 24 VerDate Sep 11 2014 00:26 Jun 22, 2021 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.PCS S2118 kjohnson on DSK79L0C42PROD with BILLS 11 •S 2118 PCS ‘‘(BB) the amount of 1 wages required to be paid to 2 such laborer or mechanic 3 pursuant to such subpara- 4 graph during such period, 5 plus 6 ‘‘(bb) interest on the 7 amount determined under item 8 (aa) at the underpayment rate 9 established under section 6621 10 for the period described in such 11 item, and 12 ‘‘(II) makes payment to the Sec- 13 retary of a penalty in an amount 14 equal to the product of— 15 ‘‘(aa) $5,000, multiplied by 16 ‘‘(bb) the total number of la- 17 borers and mechanics who were 18 paid wages at a rate below the 19 rate described in subparagraph 20 (A) for any period during such 21 year. 22 ‘‘(c) INFLATION ADJUSTMENT.— 23 ‘‘(1) IN GENERAL.—In the case of a calendar 24 year beginning after 2021, the 1.5 cent amount in 25 VerDate Sep 11 2014 00:26 Jun 22, 2021 Jkt 019200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.PCS S2118 kjohnson on DSK79L0C42PROD with BILLS 12 •S 2118 PCS paragraph (1) of subsection (a) shall be adjusted by 1 multiplying such amount by the inflation adjustment 2 factor for the calendar year in which the sale or use 3 of the electricity occurs. If any amount as increased 4 under the preceding sentence is not a multiple of 0.1 5 cent, such amount shall be rounded to the nearest 6 multiple of 0.1 cent. 7 ‘‘(2) ANNUAL COMPUTATION.—The Secretary 8 shall, not later than April 1 of each calendar year, 9 determine and publish in the Federal Register the 10 inflation adjustment factor for such calendar year in 11 accordance with this subsection. 12 ‘‘(3) INFLATION ADJUSTMENT FACTOR.—The 13 term ‘inflation adjustment factor’ means, with re- 14 spect to a calendar year, a fraction the numerator 15 of which is the GDP implicit price deflator for the 16 preceding calendar year and the denominator of 17 which is the GDP implicit price deflator for the cal- 18 endar year 1992. The term ‘GDP implicit price 19 deflator’ means the most recent revision of the im- 20 plicit price deflator for the gross domestic product 21 as computed and published by the Department of 22 Commerce before March 15 of the calendar year. 23 ‘‘(d) CREDIT PHASE-OUT.— 24 VerDate Sep 11 2014 00:26 Jun 22, 2021 Jkt 019200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\S2118.PCS S2118 kjohnson on DSK79L0C42PROD with BILLS 13 •S 2118 PCS ‘‘(1) IN GENERAL.—If the Secretary, the Sec- 1 retary of Energy, and the Administrator of the En- 2 vironmental Protection Agency determine that the 3 annual greenhouse gas emissions from the produc- 4 tion of electricity in the United States are equal to 5 or less than 25 percent of the annual greenhouse gas 6 emissions from the production of electricity in the 7 United States fo [Text truncated for display. Full text available on Congress.gov.]