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S 1511 IS

110th CONGRESS

1st Session

S. 1511

To promote the development and use of marine and hydrokinetic renewable energy technologies, and for other purposes.

IN THE SENATE OF THE UNITED STATES

May 24, 2007

Mr. AKAKA (for himself, Ms. MURKOWSKI, and Ms. SNOWE) introduced the following bill; which was read twice and referred to the Committee on Finance

A BILL

To promote the development and use of marine and hydrokinetic renewable energy technologies, and for other purposes.

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

SECTION 1. SHORT TITLE.

This Act may be cited as the `Marine and Hydrokinetic Renewable Energy Promotion Act of 2007'.

SEC. 2. DEFINITION.

For purposes of this Act, the term `marine and hydrokinetic renewable energy' means electrical energy from--

(1) waves, tides, and currents in oceans, estuaries, and tidal areas;

(2) free flowing water in rivers, lakes, and streams;

(3) free flowing water in man-made channels, including projects that utilize nonmechanical structures to accelerate the flow of water for electric power production purposes; and

(4) differentials in ocean temperature (ocean thermal energy conversion).

The term shall not include energy from any source that utilizes a dam, diversionary structure, or impoundment for electric power purposes, except as provided in paragraph (3).

SEC. 3. RESEARCH AND DEVELOPMENT.

(a) Program- The Secretary of Energy, in consultation with the Secretary of Commerce and the Secretary of the Interior, shall establish a program of marine and hydrokinetic renewable energy research focused on--

(1) developing and demonstrating marine and hydrokinetic renewable energy technologies;

(2) reducing the manufacturing and operation costs of marine and hydrokinetic renewable energy technologies;

(3) increasing the reliability and survivability of marine and hydrokinetic renewable energy facilities;

(4) integrating marine and hydrokinetic renewable energy into electric grids;

(5) identifying opportunities for cross fertilization and development of economies of scale between offshore wind and marine and hydrokinetic renewable energy sources;

(6) identifying, in consultation with the Secretary of Commerce and the Secretary of the Interior, the environmental impacts of marine and hydrokinetic renewable energy technologies and ways to address adverse impacts, and providing public information concerning technologies and other means available for monitoring and determining environmental impacts; and

(7) standards development, demonstration, and technology transfer for advanced systems engineering and system integration methods to identify critical interfaces.

(b) Authorization of Appropriations- There are authorized to be appropriated to the Secretary of Energy for carrying out this section $50,000,000 for each of the fiscal years 2008 through 2017.

SEC. 4. ADAPTIVE MANAGEMENT AND ENVIRONMENTAL FUND.

(a) Findings- The Congress finds that--

(1) the use of marine and hydrokinetic renewable energy technologies can avoid contributions to global warming gases, and such technologies can be produced domestically;

(2) marine and hydrokinetic renewable energy is a nascent industry; and

(3) the United States must work to promote new renewable energy technologies that reduce contributions to global warming gases and improve our country's domestic energy production in a manner that is consistent with environmental protection, recreation, and other public values.

(b) Establishment- The Secretary of Energy shall establish an Adaptive Management and Environmental Fund, and shall lend amounts from that fund to entities described in subsection (f) to cover the costs of projects that produce marine and hydrokinetic renewable energy. Such costs include design, fabrication, deployment, operation, monitoring, and decommissioning costs. Loans under this section may be subordinate to project-related loans provided by commercial lending institutions to the extent the Secretary of Energy considers appropriate.

(c) Reasonable Access- As a condition of receiving a loan under this section, a recipient shall provide reasonable access, to Federal or State agencies and other research institutions as the Secretary considers appropriate, to the project area and facilities for the purposes of independent environmental research.

(d) Public Availability- The results of any assessment or demonstration paid for, in whole or in part, with funds provided under this section shall be made available to the public, except to the extent that they contain information that is protected from disclosure under section 552(b) of title 5, United States Code.

(e) Repayment of Loans-

(1) IN GENERAL- The Secretary of Energy shall require a recipient of a loan under this section to repay the loan, plus interest at a rate of 2.1 percent per year, over a period not to exceed 20 years, beginning after the commercial generation of electric power from the project commences. Such repayment shall be required at a rate that takes into account the economic viability of the loan recipient and ensures regular and timely repayment of the loan.

(2) BEGINNING OF REPAYMENT PERIOD- No repayments shall be required under this subsection until after the project generates net proceeds. For purposes of this paragraph, the term `net proceeds' means proceeds from the commercial sale of electricity after payment of project-related costs, including taxes and regulatory fees that have not been paid using funds from a loan provided for the project under this section.

(3) TERMINATION- Repayment of a loan made under this section shall terminate as of the date that the project for which the loan was provided ceases commercial generation of electricity if a governmental permitting authority has ordered the closure of the facility because of a finding that the project has unacceptable adverse environmental impacts, except that the Secretary shall require a loan recipient to continue making loan repayments for the cost of equipment, obtained using funds from the loan that have not otherwise been repaid under rules established by the Secretary, that is utilized in a subsequent project for the commercial generation of electricity.

(f) Adaptive Management Plan- In order to receive a loan under this section, an applicant for a Federal license or permit to construct, operate, or maintain a marine or hydrokinetic renewable energy project shall provide to the Federal agency with primary jurisdiction to issue such license or permit an adaptive management plan for the proposed project. Such plan shall--

(1) be prepared in consultation with other parties to the permitting or licensing proceeding, including all Federal, State, municipal, and tribal agencies with authority under applicable Federal law to require or recommend design or operating conditions, for protection, mitigation, and enhancement of fish and wildlife resources, water quality, navigation, public safety, land reservations, or recreation, for incorporation into the permit or license;

(2) set forth specific and measurable objectives for the protection, mitigation, and enhancement of fish and wildlife resources, water quality, navigation, public safety, land reservations, or recreation, as required or recommended by governmental agencies described in paragraph (1), and shall require monitoring to ensure that these objectives are met;

(3) provide specifically for the modification or, if necessary, removal of the marine or hydrokinetic renewable energy project based on findings by the licensing or permitting agency that the marine or hydrokinetic renewable energy project has not attained or will not attain the specific and measurable objectives set forth in paragraph (2); and

(4) be approved and incorporated in the Federal license or permit.

(g) Sunset- The Secretary of Energy shall transmit a report to the Congress when the Secretary of Energy determines that the technologies supported under this Act have achieved a level of maturity sufficient to enable the expiration of the programs under this Act. The Secretary of Energy shall not make any new loans under this section after the report is transmitted under this subsection.

SEC. 5. PROGRAMMATIC ENVIRONMENTAL IMPACT STATEMENT.

The Secretary of Commerce and the Secretary of the Interior shall, in cooperation with the Federal Energy Regulatory Commission and the Secretary of Energy, and in consultation with appropriate State agencies, jointly prepare programmatic environmental impact statements which contain all the elements of an environmental impact statement under section 102 of the National Environmental Policy Act of 1969 (42 U.S.C. 4332), regarding the impacts of the deployment of marine and hydrokinetic renewable energy technologies in the navigable waters of the United States. One programmatic environmental impact statement shall be prepared under this section for each of the Environmental Protection Agency regions of the United States. The agencies shall issue the programmatic environmental impact statements under this section not later than 18 months after the date of enactment of this Act. The programmatic environmental impact statements shall evaluate among other things the potential impacts of site selection on fish and wildlife and related habitat. Nothing in this section shall operate to delay consideration of any application for a license or permit for a marine and hydrokinetic renewable energy technology project.

SEC. 6. PRODUCTION CREDIT FOR ELECTRICITY PRODUCED FROM MARINE RENEWABLES.

(a) In General- Subsection (c) of section 45 of the Internal Revenue Code of 1986 (relating to resources) is amended--

(1) in paragraph (1)--

(A) by striking `and' at the end of subparagraph (G),

(B) by striking the period at the end of subparagraph (H) and inserting `, and', and

`(I) marine and hydrokinetic renewable energy.', and

(2) by adding at the end the following new paragraph:

`(10) MARINE AND HYDROKINETIC RENEWABLE ENERGY-

`(A) IN GENERAL- The term `marine and hydrokinetic renewable energy' means energy derived from--

`(i) waves, tides, and currents in oceans, estuaries, and tidal areas,

`(ii) free flowing water in rivers, lakes, and streams,

`(iii) free flowing water in man-made channels, including projects that utilize nonmechanical structures to accelerate the flow of water for electric power production purposes, or

`(iv) differentials in ocean temperature (ocean thermal energy conversion).

`(B) EXCEPTIONS- Such term shall not include any energy which is--

`(i) described in subparagraphs (A) through (H) of paragraph (1), or

`(ii) derived from any source that utilizes a dam, diversionary structure, or impoundment for electric power production purposes, except as provided in subparagraph (A)(iii).'.

(b) Definition of Facility- Subsection (d) of section 45 of such Code (relating to qualified facilities) is amended by adding at the end the following new paragraph:

`(11) MARINE AND HYDROKINETIC RENEWABLE ENERGY FACILITIES- In the case of a facility producing electricity from marine and hydrokinetic renewable energy, the term `qualified facility' means any facility owned by the taxpayer which is originally placed in service after the date of the enactment of this paragraph and before January 1, 2009.'.

(c) Effective Date- The amendments made by this section shall apply to electricity produced and sold after the date of the enactment of this Act, in taxable years ending after such date.

SEC. 7. INVESTMENT CREDIT AND 5-YEAR DEPRECIATION FOR EQUIPMENT WHICH PRODUCES ELECTRICITY FROM MARINE AND HYDROKINETIC RENEWABLE ENERGY.

(a) In General- Subparagraph (A) of section 48(a)(3) of the Internal Revenue Code of 1986 (relating to energy property) is amended--

(1) by striking `or' at the end of clause (iii),

(2) by inserting `or' at the end of clause (iv), and

(3) by adding at the end the following new clause:

`(v) equipment which uses marine and hydrokinetic renewable energy (as defined in section 45(c)(10)) but only with respect to periods ending before January 1, 2018,'.

(b) 30 Percent Credit- Clause (i) of section 48(a)(2)(A) of such Code (relating to 30 percent credit) is amended--

(1) by striking `and' at the end of subclause (II), and

(2) by adding at the end the following new subclause:

`(IV) energy property described in paragraph (3)(A)(v), and'.

(c) Credits Allowed for Investment and Production- Paragraph (3) of section 48(a) of such Code (relating to energy property) is amended by inserting `(other than property described in subparagraph (A)(v))' after `any property' in the last sentence thereof.

(d) Denial of Dual Benefit- Paragraph (9) of section 45(e) of such Code (relating to coordination with credit for producing fuel from a nonconventional source) is amended--

(1) in subparagraph (A), by striking `shall not include' and all that follows and inserting `shall not include--

`(i) any facility which produces electricity from gas derived from the biodegradation of municipal solid waste if such biodegradation occurred in a facility (within the meaning of section 45K) the production from which is allowed as a credit under section 45K for the taxable year or any prior taxable year, or

`(ii) any marine and hydrokinetic facility for which a credit is claimed by the taxpayer under section 48 for the taxable year.', and

(2) in the header--

(A) by striking `CREDIT' and inserting `CREDITS', and

(B) by inserting `AND INVESTMENT IN MARINE AND HYDROKINETIC RENEWABLE ENERGY' after `NONCONVENTIONAL SOURCE'.

(e) Effective Date- The amendments made by this section shall apply to property placed in service after the date of the enactment of this Act, in taxable years ending after such date.

END