Renewable Energy Security Act of 2004 - Amends the Energy Conservation and Production Act to prohibit expenditures from exceeding an average of $3,000 per dwelling unit for labor, weatherization materials, and related matters for a renewable energy system.
Directs the Secretary of Energy to prescribe regulations for criteria and procedures governing renewable energy systems.
Amends the Energy Policy Act of 1992 to direct the Secretary to evaluate the use of renewable energy systems in residential buildings.
Amends the Biomass Energy and Alcohol Fuels Act of 1980 to redefine biomass.
Amends the Internal Revenue Code to allow as a credit against tax, for both individuals and small businesses, 20 percent of the qualified renewable energy system expenditures during the taxable year.
[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5302 Introduced in House (IH)]
108th CONGRESS
2d Session
H. R. 5302
To promote the purchase of renewable energy systems, and for other
purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
October 8, 2004
Mr. Bass (for himself, Mr. Upton, and Mr. Bradley of New Hampshire)
introduced the following bill; which was referred to the Committee on
Energy and Commerce, and in addition to the Committee on Ways and
Means, for a period to be subsequently determined by the Speaker, in
each case for consideration of such provisions as fall within the
jurisdiction of the committee concerned
_______________________________________________________________________
A BILL
To promote the purchase of renewable energy systems, 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 ``Renewable Energy Security Act of
2004''.
SEC. 2. WEATHERIZATION ASSISTANCE.
Section 415(c) of the Energy Conservation and Production Act (42
U.S.C. 6865(c)) is amended--
(1) in paragraph (1), by striking ``in paragraph (3)'' and
inserting ``in paragraphs (3) and (4)'';
(2) in paragraph (3), by striking ``$2,500 per dwelling
unit average provided in paragraph (1)'' and inserting
``dwelling unit averages provided in paragraphs (1) and (4)'';
and
(3) by adding at the end the following new paragraphs:
``(4) The expenditure of financial assistance provided under this
part for labor, weatherization materials, and related matters for a
renewable energy system shall not exceed an average of $3,000 per
dwelling unit.
``(5)(A) The Secretary, in consultation with the Secretary of
Housing and Urban Development and other appropriate Federal officers,
shall by regulations--
``(i) establish the criteria which are to be used in
prescribing performance and quality standards under paragraph
(6)(A)(ii) or in specifying any form of renewable energy under
paragraph (6)(A)(i)(I); and
``(ii) establish a procedure under which a manufacturer of
an item may request the Secretary to certify that the item will
be treated, for purposes of this paragraph, as a renewable
energy system.
``(B) The Secretary shall make a final determination with respect
to any request filed under subparagraph (A)(ii) within 1 year after the
filing of the request, together with any information required to be
filed with such request under subparagraph (A)(ii).
``(C) Each month the Secretary shall publish a report of any
request under subparagraph (A)(ii) which has been denied during the
preceding month and the reasons for the denial.
``(D) The Secretary shall not specify any form of renewable energy
under paragraph (6)(A)(i)(I) unless the Secretary determines that--
``(i) there will be a reduction in oil or natural gas
consumption as a result of such specification;
``(ii) such specification will not result in an increased
use of any item which is known to be, or reasonably suspected
to be, environmentally hazardous or a threat to public health
or safety; and
``(iii) available Federal subsidies do not make such
specification unnecessary or inappropriate (in the light of the
most advantageous allocation of economic resources).
``(6) In this subsection--
``(A) the term `renewable energy system' means a system
which--
``(i) when installed in connection with a dwelling,
transmits or uses--
``(I) solar energy, energy derived from the
geothermal deposits, energy derived from
biomass, or any other form of renewable energy
which the Secretary specifies by regulations,
for the purpose of heating or cooling such
dwelling or providing hot water or electricity
for use within such dwelling; or
``(II) wind energy for nonbusiness
residential purposes;
``(ii) meets the performance and quality standards
(if any) which have been prescribed by the Secretary by
regulations;
``(iii) in the case of a combustion rated system,
has a thermal efficiency rating of at least 75 percent;
and
``(iv) in the case of a solar system, has a thermal
efficiency rating of at least 15 percent; and
``(B) the term `biomass' means any organic matter that is
available on a renewable or recurring basis, including
agricultural crops and trees, wood and wood wastes and
residues, plants (including aquatic plants), grasses, residues,
fibers, and animal wastes, municipal wastes, and other waste
materials.''.
SEC. 3. DISTRICT HEATING AND COOLING PROGRAMS.
Section 172 of the Energy Policy Act of 1992 (42 U.S.C. 13451 note)
is amended--
(1) in subsection (a)--
(A) by striking ``and'' at the end of paragraph
(3);
(B) by striking the period at the end of paragraph
(4) and inserting ``; and''; and
(C) by adding at the end the following new
paragraph:
``(5) evaluate the use of renewable energy systems (as such
term is defined in section 415(c) of the Energy Conservation
and Production Act (42 U.S.C. 6865(c))) in residential
buildings.''; and
(2) in subsection (b), by striking ``this Act'' and
inserting ``the Renewable Energy Security Act of 2004''.
SEC. 4. DEFINITION OF BIOMASS.
Section 203(2) of the Biomass Energy and Alcohol Fuels Act of 1980
(42 U.S.C. 8802(2)) is amended to read as follows:
``(2) The term `biomass' means any organic matter that is
available on a renewable or recurring basis, including
agricultural crops and trees, wood and wood wastes and
residues, plants (including aquatic plants), grasses, residues,
fibers, and animal wastes, municipal wastes, and other waste
materials.''.
SEC. 5. CREDIT FOR RESIDENTIAL RENEWABLE ENERGY SYSTEMS.
(a) In General.--Subpart A of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 (relating to nonrefundable
personal credits) is amended by inserting after the item relating to
section 25B the following new section:
``SEC. 25C. RESIDENTIAL RENEWABLE ENERGY SYSTEM.
``(a) General Rule.--In the case of an individual, there shall be
allowed as a credit against the tax imposed by this subtitle for the
taxable year an amount equal to 20 percent of the qualified renewable
energy system expenditures made by the taxpayer during the taxable
year.
``(b) Limitations.--For purposes of subsection (a)--
``(1) Maximum credit.--The amount of the credit allowed
under subsection (a) for a taxable year shall not exceed
$3,000.
``(2) Prior expenditures by taxpayer on same residence
taken into account.--If for any prior year a credit was allowed
to the taxpayer under this section with respect to any dwelling
unit by reason of qualified renewable energy system
expenditures, paragraph (1) shall be applied for the taxable
year with respect to such dwelling unit by reducing the dollar
amount contained therein by the prior year expenditures taken
into account under such paragraph.
``(3) Minimum dollar amount.--No credit shall be allowed
under this section with respect to any return for any taxable
year if the amount which would (but for this paragraph) be
allowed with respect to such return is less than $10.
``(4) Limitation based on amount of tax.--The credit
allowed under subsection (a) for any taxable year shall not
exceed the excess of--
``(A) the sum of the regular tax liability (as
defined in section 26(b)) plus the tax imposed by
section 55, over
``(B) the sum of the credits allowable under this
subpart (other than this section and section 23) and
section 27 for the taxable year.
``(5) Carryover of unused credit.--If the credit allowable
under subsection (a) for any taxable year exceeds the
limitation imposed by paragraph (4) for such taxable year, such
excess shall be carried to the succeeding taxable year and
added to the credit allowable under subsection (a) for such
taxable year. No credit may be carried forward under this
subsection to any taxable year following the fifth taxable year
after the taxable year in which the credit arose. For purposes
of the preceding sentence, credits shall be treated as used on
a first-in first-out basis.
``(c) Definitions and Special Rules.--For purposes of this
section--
``(1) Qualified renewable energy system expenditure.--
``(A) In general.--The term `qualified renewable
energy system expenditure' means an expenditure made by
the taxpayer for renewable energy system property
installed in connection with a dwelling unit--
``(i) which is located in the United
States, and
``(ii) which is used by the taxpayer as his
principal residence.
``(B) Certain labor and other costs included.--The
term `qualified renewable energy system expenditure'
includes--
``(i) expenditures for labor costs properly
allocable to the onsite preparation, assembly,
or original installation of renewable energy
system property, and
``(ii) expenditures for an onsite well
drilled for any geothermal deposit (as defined
in section 613(e)(3)), but only if the taxpayer
has not elected under section 263(c) to deduct
any portion of such expenditures.
``(C) Swimming pool, etc., used as storage
medium.--The term `qualified renewable energy system
expenditure' does not include any expenditure properly
allocable to a swimming pool used as an energy storage
medium or to any other energy storage medium which has
a primary function other than the function of such
storage.
``(D) Certain solar panels.--No solar panel
installed as a roof (or portion thereof) shall fail to
be treated as renewable energy system property solely
because it constitutes a structural component of the
dwelling on which it is installed.
``(2) Renewable energy system property.--The term
`renewable energy system property' means property--
``(A) which constitutes a renewable energy system,
as defined by section 415(c)(6) of the Energy
Conservation and Production Act (42 U.S.C. 6865(c)(6)),
``(B) the original use of which begins with the
taxpayer, and
``(C) which can reasonably be expected to remain in
operation for at least 5 years.
``(3) Effective date.--
``(A) In general.--In the case of any energy system
specified under paragraph (2)(A), the credit allowed by
subsection (a) shall apply with respect to expenditures
which are made on or after the date on which final
notice of such specification is published in the
Federal Register.
``(B) Expenditures taken into account in following
taxable years.--The Secretary may prescribe by
regulations that expenditures made on or after the date
referred to in clause (i) and before the close of the
taxable year in which such date occurs shall be taken
into account in the following taxable year.
``(4) When expenditures made; amount of expenditures.--
``(A) In general.--Except as provided in
subparagraph (B), an expenditure with respect to an
item shall be treated as made when original
installation of the item is completed.
``(B) Construction or reconstruction of dwelling.--
In the case of qualified renewable energy system
expenditures in connection with the construction or
reconstruction of a dwelling, such expenditures shall
be treated as made when the original use of the
constructed or reconstructed dwelling by the taxpayer
begins.
``(C) Amount.--The amount of any expenditure shall
be the cost thereof.
``(D) Allocation in certain cases.--If less than 80
percent of the use of an item is for nonbusiness
residential purposes, only that portion of the
expenditures for such item which is properly allocable
to use for nonbusiness residential purposes shall be
taken into account. For purposes of this subparagraph,
use for a swimming pool shall be treated as use which
is not for residential purposes.
``(5) Principal residence.--The determination of whether or
not a dwelling unit is a taxpayer's principal residence shall
be made under principles similar to those applicable to section
121, except that--
``(A) no ownership requirement shall be imposed,
and
``(B) the period for which a dwelling is treated as
the principal residence of the taxpayer shall include
the 30-day period ending on the first day on which it
would (but for this subparagraph) be treated as his
principal residence.
``(6) Property financed by subsidized energy financing.--
``(A) Reduction of qualified expenditures.--For
purposes of determining the amount of qualified
renewable energy system expenditures made by any
individual with respect to any dwelling unit, there
shall not be taken into account expenditures which are
made from subsidized energy financing.
``(B) Dollar limits reduced.--Paragraph (1) of
subsection (b) shall be applied with respect to such
dwelling unit for any taxable year of such taxpayer by
reducing each dollar amount contained in such paragraph
(reduced as provided in subsection (b)(3)) by an amount
equal to the sum of--
``(i) the amount of the expenditures which
were made by the taxpayer during such taxable
year or any prior taxable year with respect to
such dwelling unit and which were not taken
into account by reason of subparagraph (A), and
``(ii) the amount of any Federal, State, or
local grant received by the taxpayer during
such taxable year or any prior taxable year
which was used to make qualified renewable
energy system expenditures with respect to the
dwelling unit and which was not included in the
gross income of such taxpayer.
``(C) Subsidized energy financing.--For purposes of
subparagraph (A), the term `subsidized energy
financing' means financing provided under a Federal,
State, or local program a principal purpose of which is
to provide subsidized financing for projects designed
to conserve or produce energy.
``(d) Special Rules.--For purposes of this section--
``(1) Dollar amounts in case of joint occupancy.--In the
case of any dwelling unit which is jointly occupied and used
during any calendar year as a principal residence by 2 or more
individuals--
``(A) the amount of the credit allowable under
subsection (a) by reason of qualified renewable energy
system expenditures (as the case may be) made during
such calendar year by any of such individuals with
respect to such dwelling unit shall be determined by
treating all of such individuals as one taxpayer whose
taxable year is such calendar year, and
``(B) there shall be allowable with respect to such
expenditures to each of such individuals, a credit
under subsection (a) for the taxable year in which such
calendar year ends in an amount which bears the same
ratio to the amount determined under subparagraph (A)
as the amount of such expenditures made by such
individual during such calendar year bears to the
aggregate of such expenditures made by all of such
individuals during such calendar year.
``(2) Tenant-stockholder in cooperative housing
corporation.--In the case of an individual who is a tenant-
stockholder (as defined in section 216) in a cooperative
housing corporation (as defined in such section), such
individual shall be treated as having made his tenant-
stockholder's proportionate share (as defined in section
216(b)(3)) of any expenditures of such corporation.
``(3) Condominiums.--
``(A) In general.--In the case of an individual who
is a member of a condominium management association
with respect to a condominium which he owns, such
individual shall be treated as having made his
proportionate share of any expenditures of such
association.
``(B) Condominium management association.--For
purposes of this paragraph, the term `condominium
management association' means an organization which
meets the requirements of paragraph (1) of section
528(c) (other than subparagraph (E) thereof) with
respect to a condominium project substantially all of
the units of which are used as residences.
``(4) Joint ownership of energy items.--
``(A) In general.--Any expenditure otherwise
qualifying as a qualified renewable energy system
expenditure shall not be treated as failing to so
qualify merely because such expenditure was made with
respect to 2 or more dwelling units.
``(B) Limits applied separately.--In the case of
any expenditure described in subparagraph (A), the
amount of the credit allowable under subsection (a)
shall (subject to paragraph (1)) be computed separately
with respect to the amount of the expenditure made by
each individual.
``(e) Basis Adjustments.--For purposes of this subtitle, if a
credit is allowed under this section for any expenditure with respect
to any property, the increase in the basis of such property which would
(but for this subsection) result from such expenditure shall be reduced
by the amount of the credit so allowed.
``(f) Termination.--This section shall not apply to expenditures
made after December 31, 2009.''.
(b) Clerical Amendment.--The table of sections for subpart A of
part IV of subchapter A of chapter 1 of such Code is amended by
inserting after the item relating to section 25B the following new
item:
``Sec. 25C. Residential renewable energy system.''.
(c) Basis Adjustment.--Section 1016(a) of such Code is amended by
striking ``and'' at the end of paragraph (27), by striking the period
at the end of paragraph (28) and inserting ``, and'', and by adding at
the end the following new paragraph:
``(29) to the extent provided in section 25C(e).''.
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2004.
SEC. 6. CREDIT FOR RENEWABLE ENERGY SYSTEMS PLACED IN SERVICE BY SMALL
BUSINESSES.
(a) In General.--Subpart D of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 (relating to business related
credits) is amended by adding at the end the following new section:
``SEC. 45G. RENEWABLE ENERGY SYSTEMS CREDIT.
``(a) In General.--For purposes of section 38, in the case of an
eligible small business, the amount of the renewable energy systems
credit determined under this section for any taxable year shall be an
amount equal to 20 percent of the qualified renewable energy system
expenditures for the taxable year.
``(b) Limitation.--The amount of the credit allowed under
subsection (a) for a taxable year shall not exceed $10,000.
``(c) Eligible Small Business.--For purposes of this section, the
term `eligible small business' has the meaning given such term by
section 44(b).
``(d) Qualified Renewable Energy System Expenditures.--The term
`qualified renewable energy system expenditures' has the meaning given
such term by section 25C(c)(1), except that `commercial property' shall
be substituted for `dwelling unit' each place it appears and
subparagraph (A)(ii) thereof shall not apply.
``(e) Applicable Rules.--For purposes of this section, rules
similar to the rules of paragraphs (2), (6), and (7) of section 44(d)
shall apply.''.
(b) Credit Made Part of General Business Credit.--Section 38(b) of
such Code (relating to current year business credit) is amended by
striking ``plus'' at the end of paragraph (14), by striking the period
at the end of paragraph (15) and inserting ``, plus'', and by adding at
the end the following new paragraph:
``(16) the renewable energy systems credit determined under
section 45G(a).''.
(c) Limitation on Carryback.--Section 39(d) of such Code (relating
to transitional rules) is amended by adding at the end the following
new paragraph:
``(11) No carryback of renewable energy systems credit
before effective date.--No portion of the unused business
credit for any taxable year which is attributable to the credit
determined under section 45G may be carried back to any taxable
year ending on or before the date of the enactment of section
45G.''.
(d) Clerical Amendment.--The table of sections for subpart D of
part IV of subchapter A of chapter 1 of such Code is amended by adding
at the end the following new item:
``Sec. 45G. Renewable energy systems credit.''.
(e) Effective Date.--The amendments made by this section shall
apply to taxable years ending after the date of the enactment of this
Act.
<all>
Introduced in House
Introduced in House
Referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Subcommittee on Energy and Air Quality.
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