H.R. 1689 — Carbon Capture and Storage Early Deployment Act

[Congressional Bills 111th Congress]
[From the U.S. Government Printing Office]
[H.R. 1689 Introduced in House (IH)]

111th CONGRESS
  1st Session
                                H. R. 1689

 To accelerate the development and early deployment of systems for the 
   capture and storage of carbon dioxide emissions from fossil fuel 
        electric generation facilities, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 24, 2009

Mr. Boucher (for himself, Mr. Upton, Mr. Dingell, Mr. Barton of Texas, 
 Mr. Rahall, Mr. Whitfield, Mr. Murtha, Mr. Costello, Mr. Holden, Mr. 
 Pomeroy, Mr. Davis of Alabama, Mr. Doyle, Mr. Hill, Mr. Butterfield, 
   and Mr. Wilson of Ohio) introduced the following bill; which was 
 referred to the Committee on Energy and Commerce, and in addition to 
      the Committee on Science and Technology, 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 accelerate the development and early deployment of systems for the 
   capture and storage of carbon dioxide emissions from fossil fuel 
        electric generation facilities, 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 ``Carbon Capture and Storage Early 
Deployment Act''.

SEC. 2. DEFINITIONS.

            (1) Secretary.--The term ``Secretary'' means the Secretary 
        of Energy.
            (2) Distribution utility.--The term ``distribution 
        utility'' means an entity that distributes electricity directly 
        to retail consumers under a legal, regulatory, or contractual 
        obligation to do so.
            (3) Electric utility.--The term ``electric utility'' has 
        the meaning provided by section 3(22) of the Federal Power Act 
        (16 U.S.C. 796(22)).
            (4) Fossil fuel-based electricity.--The term ``fossil fuel-
        based electricity'' means electricity that is produced from the 
        combustion of fossil fuels.
            (5) Fossil fuel.--The term ``fossil fuel'' means coal, 
        petroleum, natural gas or any derivative of coal, petroleum, or 
        natural gas.
            (6) Corporation.--The term ``Corporation'' means the Carbon 
        Storage Research Corporation established in accordance with 
        this Act.
            (7) Qualified industry organization.--The term ``qualified 
        industry organization'' means the Edison Electric Institute, 
        the American Public Power Association, the National Rural 
        Electric Cooperative Association, a successor organization of 
        such organizations or a group of owners or operators of 
        distribution utilities delivering fossil fuel-based electricity 
        who collectively represent at least 20 percent of the volume of 
        fossil fuel-based electricity delivered by distribution 
        utilities to consumers in the United States.
            (8) Retail consumer.--The term ``retail consumer'' means an 
        end-user of electricity.

SEC. 3. CARBON STORAGE RESEARCH CORPORATION.

    (a) Establishment.--
            (1) Referendum.--Qualified industry organizations may 
        conduct, at their own expense, a referendum among the owners or 
        operators of distribution utilities delivering fossil fuel-
        based electricity for the creation of a Carbon Storage Research 
        Corporation. Such referendum shall be conducted by an 
        independent auditing firm agreed to by the qualified industry 
        organizations. Voting rights in such referendum shall be based 
        on the quantity of fossil fuel-based electricity delivered to 
        consumers in the previous calendar year or other representative 
        period as determined by the Secretary pursuant to section 6. 
        Upon approval of those persons representing two-thirds of the 
        total quantity of fossil fuel-based electricity delivered to 
        retail consumers, the Corporation shall be established unless 
        opposed by the State regulatory authorities pursuant to 
        paragraph (2). All distribution utilities voting in the 
        referendum shall certify to the independent auditing firm the 
        quantity of fossil fuel-based electricity represented by their 
        vote.
            (2) State regulatory authorities.--Upon its own motion or 
        the petition of a qualified industry organization, each State 
        regulatory authority shall consider its support or opposition 
        to the creation of the Corporation under paragraph (1). State 
        regulatory authorities may notify the independent auditing firm 
        referred to in paragraph (1) of their views on the creation of 
        the Corporation within 180 days after the enactment of this 
        Act. If 40 percent or more of the State regulatory authorities 
        submit to the independent auditing firm written notices of 
        opposition, the Corporation shall not be established 
        notwithstanding the approval of the qualified industry 
        organizations as provided in paragraph (1).
    (b) Termination.--The Corporation shall be authorized to collect 
assessments and conduct operations pursuant to this Act for a 10-year 
period from the date 6 months after the date of enactment of this Act. 
After such 10-year period, the Corporation is no longer authorized to 
collect assessments and shall be dissolved on the date 15 years after 
such date of enactment, unless the period is extended by an Act of 
Congress.
    (c) Governance.--The Corporation shall operate as a division or 
affiliate of the Electric Power Research Institute (EPRI) and be 
managed by a Board of not more than 15 voting members responsible for 
its operations, including compliance with this Act. EPRI, in 
consultation with the Edison Electric Institute, the American Public 
Power Association and the National Rural Electric Cooperative 
Association shall appoint the Board members under subparagraphs (A), 
(B), and (C) of paragraph (1) from among candidates recommended by 
those organizations. At least a majority of the Board members appointed 
by EPRI shall be representatives of distribution utilities subject to 
assessments under section 5.
            (1) Members.--The Board shall include at least one 
        representative of each of the following:
                    (A) Investor-owned utilities.
                    (B) Utilities owned by a State agency or a 
                municipality.
                    (C) Rural electric cooperatives.
                    (D) Fossil fuel producers.
                    (E) Non-profit environmental organizations.
                    (F) Independent generators or wholesale power 
                providers.
                    (G) Consumer groups.
            (2) Nonvoting members.--The Board shall also include as 
        additional non-voting Members the Secretary of Energy or his 
        designee and 2 representatives of State regulatory authorities 
        as defined in section 3(17) of the Public Utility Regulatory 
        Policies Act of 1978 (16 U.S.C. 2602, 3(17)), each designated 
        by the National Association of State Regulatory Utility 
        Commissioners from States that are not within the same 
        transmission interconnection.
    (d) Compensation.--Corporation Board members shall receive no 
compensation for their services, nor shall Corporation Board members be 
reimbursed for expenses relating to their service.
    (e) Terms.--Corporation Board members shall serve terms of 4 years 
and may serve not more than 2 full consecutive terms. Members filling 
unexpired terms may serve not more than a total of 8 consecutive years. 
Former members of the Corporation Board may be reappointed to the 
Corporation Board if they have not been members for a period of 2 
years. Initial appointments to the Corporation Board shall be for terms 
of 1, 2, 3, and 4 years, staggered to provide for the selection of 3 
members each year.
    (f) Status of Corporation.--The Corporation shall not be considered 
to be an agency, department, or instrumentality of the United States, 
and no officer or director or employee of the Corporation shall be 
considered to be an officer or employee of the United States 
Government, for purposes of title 5 or title 31 of the United States 
Code, or for any other purpose, and no funds of the Corporation shall 
be treated as public money for purposes of chapter 33 of title 31, 
United States Code, or for any other purpose.

SEC. 4. FUNCTIONS AND ADMINISTRATION OF THE CORPORATION.

    (a) In General.--The Corporation shall establish and administer a 
program to accelerate the commercial availability of carbon dioxide 
capture and storage technologies and methods, including technologies 
which capture and store, or capture and convert, carbon dioxide. Under 
such program competitively awarded grants, contracts, and financial 
assistance shall be provided and entered into with eligible entities. 
Except as provided in subsection (g), the Corporation shall use all 
funds derived from assessments under section 5 to issue grants and 
contracts to eligible entities.
    (b) Purpose.--The purposes of the grants, contracts, and assistance 
under this section shall be to support commercial-scale demonstrations 
of carbon capture or storage technology projects capable of advancing 
the technologies to commercial readiness. Such projects should 
encompass a range of different coal and other fossil fuel varieties, be 
geographically diverse, involve diverse storage media, and employ 
capture or storage, or capture and conversion, technologies potentially 
suitable either for new or for retrofit applications.
    (c) Eligible Entities.--Entities eligible for grants, contracts or 
assistance under this section may include distribution utilities, 
electric utilities and other private entities, academic institutions, 
national laboratories, Federal research agencies, State research 
agencies, non-profit organizations, or consortiums of 2 or more 
entities. Pilot-scale and similar small-scale projects are not eligible 
for support by the Corporation.
    (d) Administration.--The members of the Board of Directors of the 
Corporation shall elect a Chairman and other officers as necessary, may 
establish committees and subcommittees of the Corporation, and shall 
adopt rules and bylaws for the conduct of business and the 
implementation of this Act. The Board shall appoint an Executive 
Director and professional support staff who may be employees of the 
Electric Power Research Institute. After consultation with the 
Technical Advisory Committee established under section 10, the 
Secretary, and the Director of the National Energy Technology 
Laboratory to obtain advice and recommendations on plans, programs, and 
project selection criteria, the Board shall establish priorities for 
grants, contracts, and assistance; publish requests for proposals for 
grants, contracts and assistance; award grants, contracts and 
assistance competitively, on the basis of merit, after the 
establishment of procedures that provide for scientific peer review by 
the Technical Advisory Committee. The Board shall give preference to 
applications that reflect the best overall value and prospect for 
achieving the purposes of the Act, such as those which demonstrate an 
integrated approach for capture and storage or capture and conversion 
technologies. The Board members shall not participate in making grants 
or awards to entities with whom they are affiliated.
    (e) Uses of Grants, Contracts, and Assistance.--A grant, contract, 
or other assistance provided under this section may be used to purchase 
carbon dioxide when needed to conduct tests of carbon dioxide storage 
sites, in the case of established projects that are storing carbon 
dioxide emissions, or for other purposes consistent with the purposes 
of this Act. The Corporation shall make publicly available at no cost 
information learned as a result of projects which it supports 
financially.
    (f) Intellectual Property.--The Board shall establish policies 
regarding the ownership of intellectual property developed as a result 
of Corporation grants and other forms of technology support. Such 
policies shall encourage individual ingenuity and invention.
    (g) Administrative Expenses.--Up to 5 percent of the funds 
collected in any fiscal year under section 5 may be used for the 
administrative expenses of operating the Corporation (not including 
costs incurred in the determination and collection of the assessments 
pursuant to section 5).
    (h) Programs and Budget.--Before August 1 each year, the 
Corporation, after consulting with the Technical Advisory Committee and 
the Secretary and the Director of the Department's National Energy 
Technology Laboratory and other interested parties to obtain advice and 
recommendations, shall publish for public review and comment its 
proposed plans, programs, project selection criteria, and projects to 
be funded by the Corporation for the next calendar year. The 
Corporation shall also publish for public review and comment a budget 
plan for the next calendar year, including the probable costs of all 
programs, projects, and contracts and a recommended rate of assessment 
sufficient to cover such costs. The Secretary may recommend program and 
activities the Secretary considers appropriate.
    (i) Records; Audits.--The Corporation shall keep minutes, books, 
and records that clearly reflect all of the acts and transactions of 
the Corporation and make public such information. The books of the 
Corporation shall be audited by a certified public accountant at least 
once each fiscal year and at such other times as the Corporation may 
designate. Copies of each audit shall be provided to the Congress, all 
Corporation board members, all qualified industry organizations, each 
State regulatory authority and, upon request, to other members of the 
industry. If the audit determines that the Corporation's practices fail 
to meet generally accepted accounting principles the assessment 
collection authority of the Corporation under section 5 shall be 
suspended until a certified public accountant renders a subsequent 
opinion that the failure has been corrected.
    (j) Public Access.--(1) The Corporation Board's meetings shall be 
open to the public and shall occur after at least 30 days advance 
public notice. Meetings of the Board of Directors may be closed to the 
public where the agenda of such meetings includes only confidential 
matters pertaining to project selection, the award of grants or 
contracts, personnel matter, or the receipt of legal advice.
    (2) The minutes of all meetings of the Corporation shall be made 
available to and readily accessible by the public.
    (k) Annual Report.--Each year the Corporation shall prepare and 
make publicly available a report which includes an identification and 
description of all programs and projects undertaken by the Corporation 
during the previous year. The report shall also detail the allocation 
or planned allocation of Corporation resources for each such program 
and project. The Corporation shall provide its annual report to the 
Congress, the Secretary, each State regulatory authority, and upon 
request to the public.

SEC. 5. ASSESSMENTS.

    (a) Amount.--(1) In all calendar years following its establishment, 
the Corporation shall collect an assessment on distribution utilities 
for all fossil fuel-based electricity delivered directly to retail 
consumers (as determined under section 6). The assessments shall 
reflect the relative carbon dioxide emission rates of different fossil 
fuel-based electricity, and initially shall be not less than the 
following amounts for coal, natural gas, and oil:


Fuel type                               Rate of assessment per kilowatt
                                         hour
  Coal................................  $0.00043
  Natural Gas.........................  $0.00022
  Oil.................................  $0.00032.
 

    (2) The Corporation is authorized to adjust the assessments on 
fossil fuel-based electricity to reflect changes in the expected 
quantities of such electricity from different fuel types, such that the 
assessments generate not less than $1.0 billion and not more than $1.1 
billion annually. The Corporation is authorized to supplement 
assessments through additional financial commitments.
    (b) Investment of Funds.--Pending disbursement pursuant to a 
program, plan, or project, the Corporation may invest funds collected 
through assessments under this section, and any other funds received by 
the Corporation, only in obligations of the United States or any agency 
thereof, in general obligations of any State or any political 
subdivision thereof, in any interest-bearing account or certificate of 
deposit of a bank that is a member of the Federal Reserve System, or in 
obligations fully guaranteed as to principal and interest by the United 
States.
    (c) Reversion of Unused Funds.--If the Corporation does not 
disburse, dedicate or assign 75 percent or more of the available 
proceeds of the assessed fees in any calendar year 7 or more years 
following its establishment, due to an absence of qualified projects or 
similar circumstances, it shall reimburse the remaining undedicated or 
unassigned balance of such fees, less administrative and other expenses 
authorized by this Act, to the distribution utilities upon which such 
fees were assessed, in proportion to their collected assessments.

SEC. 6. ERCOT.

    (a) Assessment, Collection, and Remitance.--(1) Notwithstanding any 
other provision of this Act, within ERCOT, the assessment provided for 
in section 5 shall be--
                    (A) levied directly on qualified scheduling 
                entities, or their successor entities;
                    (B) charged consistent with other charges imposed 
                on qualified scheduling entities as a fee on energy 
                used by the load serving entities; and
                    (C) collected and remitted by ERCOT to the 
                Corporation in the amounts and in the same manner as 
                set forth in section 5.
    (2) The assessment amounts referred to in paragraph (1) shall be--
            (A) determined by the amount and types of fossil fuel-based 
        electricity delivered directly to all retail customers in the 
        prior calendar year beginning with the year ending immediately 
        prior to the period described in section 3(b); and
            (B) take into account the number of renewable energy 
        credits retired by the load serving entities represented by a 
        qualified scheduling entity within the prior calendar year.
    (b) Administration Expenses.--Up to 1 percent of the funds 
collected in any fiscal year by ERCOT under the provisions of this 
section may be used for the administrative expenses incurred in the 
determination, collection and remittance of the assessments to the 
Corporation.
    (c) Audit.--ERCOT shall provide a copy of its annual audit 
pertaining to the administration of the provisions of this section to 
the Corporation.
    (d) Definitions.--For the purposes of this section:
            (1) The term ``ERCOT'' means the Electric Reliability 
        Council of Texas.
            (2) The term ``load serving entities'' has the meaning 
        adopted by ERCOT Protocols and in effect on the date of 
        enactment of this Act.
            (3) The term ``qualified scheduling entities'' has the 
        meaning adopted by ERCOT Protocols and in effect on the date of 
        enactment of this Act.
            (4) The term ``renewable energy credit'' has the meaning as 
        promulgated and adopted by the Public Utility Commission of 
        Texas pursuant to section 39.904(b) of the Public Utility 
        Regulatory Act of 1999, and in effect on the date of enactment 
        of this Act.

SEC. 7. DETERMINATION OF FOSSIL FUEL-BASED ELECTRICITY DELIVERIES.

    (a) Findings.--The Congress finds that:
            (1) The assessments under section 5 are to be collected 
        based on the amount of fossil fuel generated electricity 
        delivered by each distribution utility.
            (2) Since many distribution utilities purchase all or part 
        of their retail consumer's electricity needs from other 
        entities, it may not be practical to determine the precise fuel 
        mix for the power sold by each individual distribution utility.
            (3) It may be necessary to use average data, often on a 
        regional basis with reference to Regional Transmission 
        organization or NERC regions, to make the determinations 
        necessary for making assessments.
    (b) DOE Proposed Rule.--The Secretary, acting in close consultation 
with the Energy Information Administration, shall issue for notice and 
comment a proposed rule to determine the level of fossil fuel 
electricity delivered to retail customers by each distribution utility 
in the United States during the most recent calendar year or other 
period determined to be most appropriate. Such proposed rule shall 
balance the need to be efficient, reasonably precise and timely, taking 
into account the nature and cost of data currently available and the 
nature of markets and regulation in effect in various regions of the 
country. Different methodologies may be applied in different regions if 
appropriate to obtain the best balance of such factors.
    (c) Final Rule.--Within 6 months after the enactment of this Act, 
and after opportunity for comment, the Secretary shall issue a final 
rule under this section for determining the level and type of fossil 
fuel electricity delivered to retail customers by each distribution 
utility in the United States during the appropriate period. In issuing 
such rule, the Secretary may consider opportunities and costs to 
develop new data sources in the future and issue recommendations for 
the Energy Information Administration or other entities to collect such 
data. After notice and opportunity for comment the Secretary may, by 
rule, subsequently update and modify the methodology for making such 
determinations.
    (d) Annual Determinations.--Pursuant to the final rule issued under 
subsection (c), the Secretary shall make annual determinations of the 
amounts and types for each such utility and publish such determinations 
in the Federal Register. Such determinations shall be used to conduct 
the referendum under section 3 and by the Corporation in applying any 
assessment under this title.
    (e) Rehearing and Judicial Review.--The owner or operator of any 
distribution utility that believes that the Secretary has misapplied 
the methodology in the final rule in determining the amount and types 
of fossil fuel electricity delivered by such distribution utility may 
seek rehearing of such determination within 30 days of publication of 
the determination in the Federal Register. The Secretary shall decide 
such rehearing petitions within 30 days. The Secretary's determinations 
following rehearing shall be final and subject to judicial review in 
the United States court of appeals for the District of Columbia.

SEC. 8. COMPLIANCE WITH CORPORATION ASSESSMENTS.

    The Corporation may bring an action in the appropriate court of the 
United States to compel compliance with an assessment levied by the 
Corporation under this Act. A successful action for compliance under 
this section may also require payment by the defendant of the costs 
incurred by the Corporation in bringing such action.

SEC. 9. MIDCOURSE REVIEW.

    Not later than 5 years following establishment of the Corporation, 
the Comptroller General of the United States shall prepare an analysis, 
and report to Congress, assessing the Corporation's activities, 
including project selection and methods of disbursement of assessed 
fees, impacts on the prospects for commercialization of carbon capture 
and storage technologies, and adequacy of funding. The report shall 
also make such recommendations as may be appropriate in each of these 
areas. The Corporation shall reimburse the Government Accountability 
Office for the costs associated with performing this midcourse review.

SEC. 10. RECOVERY OF COSTS.

    (a) In General.--A distribution utility whose transmission, 
delivery, or sales of electric energy are subject to any form of rate 
regulation shall not be denied the opportunity to recover the full 
amount of the prudently incurred costs associated with complying with 
this Act, consistent with applicable State or Federal law.
    (b) Ratepayer Rebates.--Regulatory authorities that approve cost 
recovery pursuant to subsection (a) may order rebates to ratepayers to 
the extent that distribution utilities are reimbursed undedicated or 
unassigned balances pursuant to section 5(c).

SEC. 11. TECHNICAL ADVISORY COMMITTEE.

    (a) Establishment.--There is established an advisory committee, to 
be known as the ``Technical Advisory Committee''.
    (b) Membership.--The Technical Advisory Committee shall be 
comprised of not less than 7 members appointed by the Board from among 
academic institutions, national laboratories, independent research 
institutions, and other qualified institutions. No member of the 
Committee shall be affiliated with EPRI or with any organization having 
members serving on the Board. At least one member of the Committee 
shall be appointed from among officers or employees of the Department 
of Energy recommended to the Board by the Secretary of Energy.
    (c) Chairperson and Vice Chairperson.--The Board shall designate 
one member of the Technical Advisory Committee to serve as Chairperson 
of the Committee and one to serve as Vice Chairperson of the Committee.
    (d) Compensation.--The Board shall provide compensation to members 
of the Technical Advisory Committee for travel and other incidental 
expenses and such other compensation as the Board determines to be 
necessary.
    (e) Purpose.--The Technical Advisory shall provide independent 
assessments and technical evaluations, as well as make non-binding 
recommendations to the Board, concerning Corporation activities, 
including but not limited to the following:
            (1) Reviewing and evaluating the Corporation's plans and 
        budgets described in section 4 (h), as well as any other 
        appropriate areas, which could include approaches to 
        prioritizing technologies, appropriateness of engineering 
        techniques, monitoring and verification technologies for 
        storage, geological site selection, cost control measures.
            (2) Making annual non-binding recommendations to the Board 
        concerning any of the matters referred to in paragraph (1), as 
        well as what types of investments, scientific research, or 
        engineering practices would best further to the goals of the 
        Corporation.
    (f) Public Availability.--All reports, evaluations, and other 
materials of the Technical Advisory Committee shall be made available 
to the public by the Board, without charge, at time of receipt by the 
Board.

SEC. 12. LOBBYING RESTRICTIONS.

    No funds collected by the Corporation shall be used in any manner 
for influencing legislation or elections, except that the Corporation 
may recommend to the Secretary and the Congress changes in this Act or 
other statutes that would further the purposes of this Act.

SEC. 13. DAVIS-BACON COMPLIANCE.

    The Corporation shall ensure that entities receiving grants, 
contracts, or other financial support from the Corporation for the 
project activities authorized by this Act are in compliance with the 
Davis-Bacon Act (40 U.S.C. 276a-276a-5).
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