Energy Innovation and Carbon Dividend Act of 2021
This bill imposes a fee on the carbon content of fuels, including crude oil, natural gas, coal, or any other product derived from those fuels that will be used so as to emit greenhouse gases into the atmosphere.
The fee is imposed on the producers or importers of the fuels and is equal to the greenhouse gas content of the fuel multiplied by the carbon fee rate. The rate begins at $15 per metric ton of CO2-e in 2021, increases by $10 each year, and is subject to further adjustments based on the progress in meeting specified emissions reduction targets.
The bill includes
The fees must be deposited into a Carbon Dividend Trust Fund and used for administrative expenses and dividend payments to U.S. citizens or lawful residents. The fees must be decommissioned when emissions levels and monthly dividend payments fall below specified levels.
[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2307 Introduced in House (IH)]
<DOC>
117th CONGRESS
1st Session
H. R. 2307
To create a Carbon Dividend Trust Fund for the American people in order
to encourage market-driven innovation of clean energy technologies and
market efficiencies which will reduce harmful pollution and leave a
healthier, more stable, and more prosperous Nation for future
generations.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
April 1, 2021
Mr. Deutch (for himself, Mr. Malinowski, Ms. Eshoo, Ms. Schakowsky, Mr.
Crist, Mr. Kilmer, Mr. Peters, Ms. Chu, Mr. Connolly, Ms. Craig, Mr.
Morelle, Mr. Carbajal, Mr. Raskin, Mr. Sires, Mr. Sherman, Mr. Crow,
Mr. Correa, Ms. Scanlon, Mr. Johnson of Georgia, Ms. Pingree, Mr.
Moulton, Ms. Roybal-Allard, Mr. Garamendi, Mr. Evans, Mr. Phillips, Ms.
Meng, Mr. Cardenas, Ms. Lee of California, and Mr. Cartwright)
introduced the following bill; which was referred to the Committee on
Ways and Means, and in addition to the Committees on Energy and
Commerce, and Foreign Affairs, 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 create a Carbon Dividend Trust Fund for the American people in order
to encourage market-driven innovation of clean energy technologies and
market efficiencies which will reduce harmful pollution and leave a
healthier, more stable, and more prosperous Nation for future
generations.
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 ``Energy Innovation and Carbon
Dividend Act of 2021''.
SEC. 2. FINDINGS.
The Congress finds that--
(1) efficient markets strengthen our economy and benefit
our Nation by encouraging competition, innovation, and
technological progress;
(2) efficient markets should reflect all costs of goods to
ensure that they advance America's prosperity and national
interests;
(3) emissions of carbon pollution and other harmful
pollutants into our Nation's air impose substantial costs on
all Americans and on future generations; and
(4) creation of a Carbon Dividend Trust Fund, to be
distributed to the American people, will make markets more
efficient, create jobs, and stimulate competition, innovation,
and technological progress that benefit all Americans and
future generations.
SEC. 3. CARBON DIVIDENDS AND CARBON FEE.
The Internal Revenue Code of 1986 is amended by adding at the end
the following new subtitle:
``Subtitle L--CARBON DIVIDENDS AND CARBON FEE
``Chapter 101. Carbon Fees.
``Chapter 102. Carbon Border Fee Adjustment.
``CHAPTER 101--CARBON FEES
``Sec. 9901. Definitions.
``Sec. 9902. Carbon fee.
``Sec. 9903. Emissions reduction schedule.
``Sec. 9904. Decommissioning of carbon fee.
``Sec. 9905. Carbon Capture and Sequestration.
``Sec. 9906. Administrative authority.
``SEC. 9901. DEFINITIONS.
``For purposes of this subtitle:
``(a) Administrator.--The term `Administrator' means the
Administrator of the Environmental Protection Agency.
``(b) Carbon Dioxide Equivalent or CO<INF>2</INF>-e.--The term
`carbon dioxide equivalent' or `CO<INF>2</INF>-e' means the number of
metric tons of carbon dioxide emissions with the same global warming
potential as one metric ton of another greenhouse gas.
``(c) Carbon-Intensive Product.--The term `carbon-intensive
product' means, as identified by the Secretary by rule--
``(1) for purposes of this chapter--
``(A) any manufactured or agricultural product
which the Secretary in consultation with the
Administrator determines is emissions-intensive and
trade-exposed, except that no covered fuel is a carbon-
intensive product, and
``(B) until such time that the Secretary
promulgates rules identifying carbon-intensive
products, the following shall be considered carbon-
intensive products: iron, steel, steel mill products
(including pipe and tube), aluminum, cement, glass
(including flat, container, and specialty glass and
fiberglass), pulp, paper, chemicals, or industrial
ceramics, and
``(2) for purposes of chapter 102, any economic sector, or
product from that sector, which the Secretary in consultation
with the Administrator determines is prone to carbon leakage
because it is emissions-intensive and trade-exposed, along with
other pertinent criteria, except that no covered fuel is a
carbon-intensive product.
``(d) Carbon Leakage.--The term `carbon leakage' means an increase
of global greenhouse gas emissions which are substantially due to the
relocation of greenhouse gas sources from the United States to
jurisdictions which lack comparable controls upon greenhouse gas
emissions.
``(e) Cost of Carbon or Carbon Costs.--The term `cost of carbon' or
`carbon costs' means a national or sub-national government policy which
explicitly places a price on greenhouse gas pollution and shall be
limited to either a tax on greenhouse gases or a system of cap-and-
trade. The cost of carbon is expressed as the price per metric ton of
CO<INF>2</INF>-e.
``(f) Covered Entity.--The term `covered entity' means--
``(1) in the case of crude oil--
``(A) a refinery operating in the United States,
and
``(B) any importer of any petroleum or petroleum
product into the United States,
``(2) in the case of coal--
``(A) any coal mining operation in the United
States, and
``(B) any importer of coal into the United States,
``(3) in the case of natural gas--
``(A) any entity entering pipeline quality natural
gas into the natural gas transmission system, and
``(B) any importer of natural gas into the United
States, and
``(4) any entity or class of entities which, as determined
by the Secretary, is transporting, selling, or otherwise using
a covered fuel in a manner which emits a greenhouse gas to the
atmosphere and which has not been covered by the carbon fee or
the carbon border fee adjustment.
``(g) Covered Fuel.--The term `covered fuel' means crude oil,
natural gas, coal, or any other product derived from crude oil, natural
gas, or coal which shall be used so as to emit greenhouse gases to the
atmosphere.
``(h) Crude Oil.--The term `crude oil' means unrefined petroleum.
``(i) Export.--The term `export' means to transport a product from
within the jurisdiction of the United States to persons outside the
United States.
``(j) Fossil Fuel.--The term `fossil fuel' means coal, coal
products, petroleum, petroleum products, or natural gas.
``(k) Full Fuel Cycle Greenhouse Gas Emissions.--The term `full
fuel cycle greenhouse gas emissions' means the greenhouse gas content
of a covered fuel plus that covered fuel's upstream greenhouse gas
emissions.
``(l) Global Warming Potential.--The term `global warming
potential' means the ratio of the time-integrated radiative forcing
from the instantaneous release of one kilogram of a trace substance
relative to that of one kilogram of carbon dioxide.
``(m) Greenhouse Gas.--The term `greenhouse gas' means carbon
dioxide (CO<INF>2</INF>), methane (CH<INF>4</INF>), nitrous oxide
(N<INF>2</INF>O), and other gases as defined by rule of the
Administrator.
``(n) Greenhouse Gas Content.--The term `greenhouse gas content'
means the amount of greenhouse gases of a product or a fuel, expressed
in metric tons of CO<INF>2</INF>-e, which would be emitted to the
atmosphere by the use of a covered fuel and shall include,
nonexclusively, emissions of carbon dioxide (CO<INF>2</INF>), nitrous
oxide (N<INF>2</INF>O), methane (CH<INF>4</INF>), and other greenhouse
gases as identified by rule of the Administrator.
``(o) Greenhouse Gas Effect.--The term `greenhouse gas effect'
means the adverse effects of greenhouse gases on health or welfare
caused by the greenhouse gas's heat-trapping potential or its effect on
ocean acidification.
``(p) Import.--Irrespective of any other definition in law or
treaty, the term `import' means to land on, bring into, or introduce
into any place subject to the jurisdiction of the United States.
``(q) Petroleum.--The term `petroleum' means oil removed from the
earth or the oil derived from tar sands or shale.
``(r) Production Greenhouse Gas Emissions.--The term `production
greenhouse gas emissions' means the quantity of greenhouse gases,
expressed in metric tons of CO<INF>2</INF>-e, emitted to the atmosphere
resulting from, nonexclusively, the production, manufacture, assembly,
transportation, or financing of a product.
``(s) Upstream Greenhouse Gas Emissions.--The term `upstream
greenhouse gas emissions' means the quantity of greenhouse gases,
expressed in metric tons of CO<INF>2</INF>-e, emitted to the atmosphere
resulting from, nonexclusively, the extraction, processing,
transportation, financing, or other preparation of a covered fuel for
use.
``SEC. 9902. CARBON FEE.
``(a) Carbon Fee.--There is hereby imposed a carbon fee on any
covered entity's emitting use, or sale or transfer for an emitting use,
of any covered fuel.
``(b) Amount of the Carbon Fee.--The carbon fee imposed by this
section is an amount equal to--
``(1) the greenhouse gas content of the covered fuel,
multiplied by
``(2) the carbon fee rate.
``(c) Carbon Fee Rate.--For purposes of this section--
``(1) In general.--The carbon fee rate, with respect to any
use, sale, or transfer during a calendar year, shall be--
``(A) in the case of calendar year 2021, $15 per
metric ton of CO<INF>2</INF>-e, and
``(B) except as provided in paragraph (2), in the
case of any calendar year thereafter--
``(i) the carbon fee rate in effect under
this subsection for the preceding calendar
year, plus
``(ii) $10.
``(2) Exceptions.--
``(A) Increased carbon fee rate after missed annual
emissions reduction target.--In the case of any year
immediately following a year for which the Secretary
determines under section 9903(b) that the actual
emissions of greenhouse gases from covered fuels
exceeded the emissions reduction target for the
previous year, paragraph (1)(B)(ii) shall be applied by
substituting `$15' for the dollar amount otherwise in
effect for the calendar year under such paragraph.
``(B) Cessation of carbon fee rate increase after
certain emission reductions achieved.--In the case of
any year immediately following a year for which the
Secretary determines under 9903(b) that actual
emissions of greenhouse gases from covered fuels is not
more than 10 percent of the greenhouse gas emissions
from covered fuels during the year 2010, paragraph
(1)(B)(ii) shall be applied by substituting `$0' for
the dollar amount otherwise in effect for the calendar
year under such paragraph.
``(3) Inflation adjustment.--In the case of any calendar
year after 2021, each of the dollar amounts in paragraphs
(1)(B) and (2)(A) shall be increased by an amount equal to--
``(A) such dollar amount, multiplied by
``(B) the cost-of-living adjustment determined
under section 1(f)(3) for the calendar year, determined
by substituting `calendar year 2010' for `calendar year
2016' in subparagraph (A)(ii) thereof.
``(d) Exemption and Refund.--The Secretary shall prescribe such
rules as are necessary to ensure the fee imposed by this section is not
imposed with respect to any nonemitting use, or any sale or transfer
for a nonemitting use, including rules providing for the refund of any
carbon fee paid under this section with respect to any such use, sale,
or transfer.
``(e) Exemptions.--
``(1) Agriculture.--
``(A) Fuel.--If any covered fuel or its derivative
is used on a farm for a farming purpose, the Secretary
shall pay (without interest) to the ultimate purchaser
of such covered fuel or its derivative, the total
amount of carbon fees previously paid upon that covered
fuel or its derivative, as specified by rule of the
Secretary.
``(B) Farm, farming use, and farming purpose.--The
terms `farm', `farming use', and `farming purpose'
shall have the respective meanings given such terms
under section 6420(c).
``(C) Other greenhouse gases emissions from
agriculture.--The carbon fee shall not be levied upon
non-fossil fuel greenhouse gas emissions which occur on
a farm.
``(2) Armed forces of the united states.--If any covered
fuel or its derivative is used by the Armed Forces of the
United States as supplies for vessels of war, vehicles, or
electrical power generation equipment, the Secretary shall pay
(without interest) to the ultimate purchaser of such covered
fuel or its derivative, the total amount of carbon fees
previously paid upon that covered fuel or its derivative, as
specified by rule of the Secretary.
``SEC. 9903. EMISSIONS REDUCTION SCHEDULE.
``(a) In General.--An emissions reduction schedule for greenhouse
gas emissions from covered fuels is hereby established, as follows:
``(1) Reference year.--The net greenhouse gas emissions
during the year 2010 shall be the reference amount of emissions
and shall be determined from the `Inventory of U.S. Greenhouse
Gas Emissions and Sinks: 1990-2010' published by the
Environmental Protection Agency in April of 2012.
``(2) Emissions reduction target.--The first emission
reduction target shall be for the year 2023. The emission
target for each year thereafter shall be the previous year's
target emissions minus a percentage of emissions during the
reference year determined in accordance with the following
table:
----------------------------------------------------------------------------------------------------------------
``Year Emissions Reduction Target
----------------------------------------------------------------------------------------------------------------
2010 Reference year
----------------------------------------------------------------------------------------------------------------
2021 to 2022 No emissions reduction target
----------------------------------------------------------------------------------------------------------------
2023 to 2030 5 percent of 2010 emissions per year
----------------------------------------------------------------------------------------------------------------
2031 to 2050 3 percent of 2010 emissions per year
----------------------------------------------------------------------------------------------------------------
``(b) Administrative Determination.--Not later than 60 days after
the beginning of each calendar year beginning after the enactment of
this section, the Secretary, in consultation with the Administrator,
shall determine whether actual emissions of greenhouse gases from
covered fuels exceeded the emissions reduction target for the preceding
calendar year. The Secretary shall make such determination using the
same, or appropriately updated, greenhouse gas accounting method as was
used to determine the net greenhouse gas emissions in the `Inventory of
U.S. Greenhouse Gas Emissions and Sinks: 1990-2010' published by the
Environmental Protection Agency in April of 2012.
``SEC. 9904. DECOMMISSIONING OF CARBON FEE.
``(a) In General.--At such time that--
``(1) the Secretary determines under 9903(b) that actual
emissions of greenhouse gases from covered fuels is not more
than 10 percent of the greenhouse gas emissions during the year
2010, and
``(2) the monthly carbon dividend payable to an adult
eligible individual has been less than $20 for 3 consecutive
years,
the Secretary shall decommission in an orderly manner programs
administering the carbon fee, the carbon border fee adjustment, and the
Carbon Dividend Trust Fund.
``(b) Inflation Adjustment.--In the case of any calendar year after
2021, the $20 amount under subsection (a)(2) shall be increased by an
amount equal to--
``(1) such dollar amount, multiplied by
``(2) cost-of-living adjustment determined under section
1(f)(3) for the calendar year, determined by substituting
`calendar year 2020' for `calendar year 2010' in subparagraph
(A)(ii) thereof.
``SEC. 9905. CARBON CAPTURE AND SEQUESTRATION.
``(a) In General.--The Secretary, in consultation with the
Administrator and the Secretary of Energy, shall prescribe regulations
for making payments as provided in subsection (b) to qualified
facilities which capture and sequester qualified carbon dioxide or
sequester qualified carbon dioxide obtained from one or more qualified
facilities.
``(b) Payment Amounts.--
``(1) In general.--The Secretary shall make payments to a
qualified facility in the same manner as if such payment was a
refund of an overpayment of the carbon fee imposed by section
9902, in cases in which such qualified facility--
``(A) uses any covered fuel--
``(i) with respect to which the carbon fee
has been paid, and
``(ii) which results in the emission of
qualified carbon dioxide,
``(B) captures such emitted, or an equivalent
amount of, qualified carbon dioxide, and
``(C)(i) sequesters such qualified carbon dioxide
in a manner which is safe, permanent, and in compliance
with any applicable local, State, and Federal laws, or
``(ii) utilizes such qualified carbon dioxide or an
equivalent amount of carbon dioxide in a manner
provided in paragraph (3)(C).
``(2) Amount of refund.--The payment determined under this
section shall be an amount equal to the lesser of--
``(A)(i) the adjusted metric tons of qualified
carbon dioxide captured and sequestered or utilized,
multiplied by
``(ii) the carbon fee rate during the year in which
the carbon fee was imposed by section 9902 upon the
covered fuel to which such carbon dioxide relates, or
``(B) the amount of the carbon fee imposed by
section 9902 with respect to such covered fuel.
``(3) Definitions and special rules.--For purposes of this
section--
``(A) Qualified carbon dioxide; qualified
facility.--
``(i) Qualified carbon dioxide.--The term
`qualified carbon dioxide' has the same meaning
given such term under section 45Q(c).
``(ii) Qualified facility.--The term
`qualified facility' means any industrial
facility at which carbon capture equipment is
placed in service.
``(B) Adjusted total metric tons.--The adjusted
total metric tons of qualified carbon dioxide captured
and sequestered or utilized shall be the total metric
tons of qualified carbon dioxide captured and
sequestered or utilized, reduced by the amount of any
carbon dioxide likely to escape and be emitted into the
atmosphere due to imperfect storage technology or
otherwise, as determined by the Secretary in
consultation with the Administrator.
``(C) Utilization.--The Secretary, in consultation
with the Administrator, shall establish regulations
providing for the methods and processes by which
qualified carbon dioxide may be utilized so as to
exclude that qualified carbon dioxide safely and
permanently from the atmosphere. Utilization may
include the production of substances such as but not
limited to plastics and chemicals. Such regulations
shall minimize the escape or further emission of the
qualified carbon dioxide into the atmosphere.
``(D) Sequestration.--Not later than 540 days after
the date of the enactment of this section, the
Secretary, in consultation with the Administrator,
shall prescribe regulations identifying the conditions
under which carbon dioxide may be safely and
permanently sequestered.
``(4) Coordination with credit for carbon dioxide
sequestration.--At such time that the Secretary prescribes
regulations implementing this section, no payment under this
section shall be allowed to a taxpayer to whom a credit has
been allowed for any taxable year under section 45Q.
``SEC. 9906. ADMINISTRATIVE AUTHORITY.
``(a) In General.--The Secretary in consultation with the
Administrator shall prescribe such regulations, and other guidance, as
may be necessary to carry out the purposes of this subtitle and assess
and collect the carbon fee imposed by section 9902.
``(b) Specifically.--Such regulations and guidance shall include--
``(1) the identification of an effective point in the
production, distribution, or use of a covered fuel for
collecting such carbon fee, in such a manner so as to minimize
administrative burden and maximize the extent to which full
fuel cycle greenhouse gas emissions from covered fuels have the
carbon fee levied upon them,
``(2) the identification of covered entities which shall be
liable for the payment of the carbon fee,
``(3) requirements for the monthly payment of such fees,
``(4) as may be necessary or convenient, rules for
distinguishing between different types of covered fuels,
``(5) as may be necessary or convenient, rules for
distinguishing between a covered fuel's greenhouse gas content
and its upstream greenhouse gas emissions,
``(6) rules to ensure that no covered fuel has the carbon
fee or carbon border fee adjustment imposed upon it more than
once, and
``(7) rules to ensure that the domestic implementation of
the carbon fee coordinate with the implementation of the carbon
border fee adjustment of chapter 102.
``CHAPTER 102--CARBON BORDER FEE ADJUSTMENT
``Sec. 9908. Carbon border fee adjustment.
``Sec. 9909. Administration of the carbon border fee adjustment.
``Sec. 9910. Allocation of carbon border fee adjustment revenues.
``Sec. 9911. Treaties and international negotiations.
``SEC. 9908. CARBON BORDER FEE ADJUSTMENT.
``(a) In General.--The fees imposed by, and refunds allowed under,
this section shall be referred to as the `carbon border fee
adjustment'.
``(b) Purpose.--The purpose of the carbon border fee adjustment is
to protect animal, plant, and human life and health, to conserve
exhaustible natural resources by preventing carbon leakage, and to
facilitate the creation of international agreements.
``(c) Imports to the United States.--
``(1) Imported covered fuels fee.--In the case of any
person that imports into the United States any covered fuel,
there shall be imposed a fee equal to the total carbon fee that
would be imposed on the fuel's greenhouse gas content under the
domestic carbon fee, including processing emissions.
``(2) Imported carbon-intensive products fee.--In the case
of any person that imports into the United States any carbon-
intensive product, there shall be imposed a fee equal to the
total carbon fee which would have accumulated upon the
greenhouse gas content of the imported carbon-intensive product
had the imported carbon-intensive product been produced
domestically and subject to the domestic carbon fee.
``(3) Modifications.--The Secretary shall make an
administrative determination of whether any class of imported
covered fuels or class of imported carbon-intensive product is
carrying any total foreign carbon cost. The Secretary shall
make a determination of whether international law or the
enhancement of global greenhouse gas mitigation efforts require
that those foreign cost of carbon be deducted from the border
carbon fee adjustment determined in subsection (c)(1) or
subsection (d)(1).
``(4) Foreign cost of carbon; foreign carbon costs.--For
purposes of this subsection, the term `foreign cost of carbon'
or `foreign carbon cost' means the explicit price a foreign
jurisdiction places upon the emission of greenhouse gas
pollution to the atmosphere through law or regulation. Such
price shall be expressed as the price per metric ton of
CO<INF>2</INF>-e.
``(d) Refund on Exports From United States.--
``(1) Covered fuels.--Under regulations prescribed by the
Secretary, in the case of a covered fuel produced in the United
States with respect to which the fee under section 9902 was
paid, there shall be allowed as a credit or refund (without
interest) to any exporter of such covered fuels an amount equal
to the total carbon fee levied upon the exported covered fuel
up to the time of its exportation, including processing
emissions. Any such credit or refund shall be allowed in the
same manner as if it were an overpayment of tax imposed by
section 9902.
``(2) Carbon-intensive products.--Under regulations
prescribed by the Secretary, there shall be allowed a credit or
refund (without interest) to exporters of carbon-intensive
products manufactured or produced in the United States an
amount equal to the total carbon fees accumulated upon the
greenhouse gas content of the exported carbon-intensive product
up to the time of exportation. Any such credit or refund shall
be allowed in the same manner as if it were an overpayment of
the fee imposed by section 9902 or 9904.
``SEC. 9909. ADMINISTRATION OF THE CARBON BORDER FEE ADJUSTMENT.
``(a) Generally.--The Secretary in consultation with the
Administrator shall prescribe regulations and guidance which implement
the carbon border fee adjustment under section 9908.
``(b) Collaboration.--In administering any aspect of the border
carbon fee adjustment it is the sense of Congress that the Secretary
should collaborate with authorized officers of any jurisdiction,
including sub-national governments, affected by the carbon border fee
adjustment.
``(c) Methodology.--In administering the border carbon fee
adjustment, the Secretary shall use methodologies, procedures, and data
which as may be necessary or convenient--
``(1) disaggregate a product's greenhouse gas content;
``(2) are consistent with international law and facilitate
international cooperation;
``(3) in the case of incomplete data, use customary methods
of interpolation that favor enhanced mitigation and facilitate
international cooperation;
``(4) avoid the double pricing of greenhouse gas emissions;
and
``(5) harmonize the border carbon fee adjustment with the
domestic carbon fee so as to ensure all covered fuels used in
the United States are subject to the carbon fee.
``(d) Schedule.--The Secretary shall--
``(1) begin implementation the border carbon fee adjustment
for covered fuels at the same time as the implementation of the
carbon fee; and
``(2) begin implementation of the border carbon fee
adjustment for carbon-intensive products within two years of
the date of the enactment of the Energy Innovation and Carbon
Dividend Act of 2021.
``(e) Procedure.--The Secretary shall--
``(1) establish fair, timely, impartial, and as necessary
confidential procedures by which the importer of any carbon-
intensive product or any covered fuel may petition the
Secretary to revise the Secretary's determination of its border
carbon fee adjustment liability calculated under section
9908(c)(1);
``(2) establish fair, timely, impartial, and as necessary
confidential procedures by which any exporter of any product
from the United States may petition the Secretary to include
that exported product on the list of carbon-intensive products;
and
``(3) establish fair, timely, impartial, and as necessary
confidential procedures by which the exporter of any carbon-
intensive product or any covered fuel may petition the
Secretary to revise the Secretary's determination of its border
carbon fee adjustment refund calculated under section 9908(d).
``(f) Shipments From the United States to the Territories of the
United States.--Notwithstanding any other treaty, law, or policy,
shipments of covered fuels or carbon-intensive products from the United
States to Guam, the United States Virgin Islands, American Samoa,
Puerto Rico, and the Northern Mariana Islands shall be eligible for a
refund of the carbon fee under section 9908(d).
``(g) Imports to the Territories of the United States.--
Notwithstanding any other treaty, law, or policy, imports of covered
fuels or carbon-intensive products to Guam, the United States Virgin
Islands, American Samoa, Puerto Rico, and the Northern Mariana Islands
shall not be subject to section 9908(c).
``SEC. 9910. ALLOCATION OF CARBON BORDER FEE ADJUSTMENT REVENUES.
``The revenues collected under this chapter may be used to
supplement appropriations made available in fiscal years 2022 and
thereafter--
``(1) to U.S. Customs and Border Protection, in such
amounts as are necessary to administer the carbon border fee
adjustment, then
``(2) to the Green Climate Fund, created by decision 3/
CP.17 adopted at the 17th Conference of the Parties to the
United Nation Framework Convention on Climate Change held in
Durban, November 28 to December 11, 2011.
``SEC. 9911. TREATIES AND INTERNATIONAL NEGOTIATIONS.
``(a) Conformance With International Treaties.--In the case that
the Appellate Body of the World Trade Organization, or any other
authoritative international treaty interpreter, shall find any portion
of the carbon border fee adjustment under this chapter to violate any
treaty to which the United States is a party, the Secretary of State is
authorized to alter that aspect of such carbon border fee adjustment
found to violate a treaty obligation so as to bring the carbon border
fee adjustment into conformance with international law.
``(b) International Negotiations.--The Congress finds the
international mitigation of greenhouse gas emissions to be of national
importance. Therefore, the Congress encourages the Secretary of State,
or the Secretary's designee, to commence and complete negotiations with
other nations with the goal of forming treaties, environmental
agreements, accords, partnerships or any other instrument that
effectively reduces global greenhouse gas emissions to zero percent of
2010 levels by 2050 and which respect the principle of common but
differentiated responsibilities and respective capabilities.
``(c) Suspension of the Carbon Border Fee Adjustment.--The
Secretary may suspend the border carbon fee adjustment, in whole or in
part--
``(1) when, in the determination of the Secretary, a
country has implemented greenhouse gas mitigation policies
sufficient to contribute to a global net reduction of
greenhouse gas emissions to zero by 2050. In making such
determination, the Secretary may partially suspend particular
provisions of the carbon border fee adjustment. In making the
determination, the Secretary shall consult with the importing
country. In making the determination, the Secretary shall
follow all existing treaty obligations. The Secretary shall
review any carbon border fee adjustment suspension at least
every 5 years, or
``(2) by treaty or other international agreement that meets
the criteria of section 9911(c)(1) and includes provisions for
the suspension of the border carbon fee adjustment.''.
SEC. 4. ESTABLISHMENT OF THE CARBON DIVIDEND TRUST FUND.
(a) In General.--Subchapter A of chapter 98 of the Internal Revenue
Code of 1986 is amended by adding at the end the following:
``SEC. 9512. CARBON DIVIDEND TRUST FUND.
``(a) Establishment and Funding.--There is hereby established in
the Treasury of the United States a trust fund to be known as the
`Carbon Dividend Trust Fund', consisting of such amounts as may be
appropriated to such trust fund as provided for in this section.
``(b) Transfers to the Carbon Dividend Trust Fund.--There is hereby
appropriated to the Carbon Dividend Trust Fund amounts equal to the
fees received into the Treasury less any amounts refunded or paid under
section 9902(d) or 9905 of chapter 101 for each month.
``(c) Expenditures.--Amounts in the trust fund shall be available
for the following purposes:
``(1) Administrative expenses.--So much of the expenses
necessary to administer the Carbon Dividend Trust Fund for each
year, as does not exceed--
``(A) in the case of the first 5 calendar years
ending after the date of the enactment of this section,
the administrative expenses for any year may not exceed
8 percent of amounts appropriated to the Carbon
Dividend Trust Fund during such year, and
``(B) in the case of any calendar year thereafter,
2 percent of the 5-year rolling average of the amounts
appropriated to the Carbon Dividend Trust Fund.
``(2) Other administrative expenses.--So much of the
expenses as are necessary to administer chapter 101 for any
year as does not to exceed 0.60 percent of the amounts
appropriated to the Carbon Dividend Trust Fund for the previous
year, and further limited as follows:
``(A) The Department of the Treasury.
``(B) The Social Security Administration.
``(C) The Environmental Protection Agency.
``(D) Department of State.
``(3) Carbon dividend payments.--
``(A) In general.--From the amounts in the Carbon
Dividend Trust Fund made available under paragraphs (1)
and (2) of this subsection for any year, the Secretary
shall for each month beginning no more than 270 days
after the date of the enactment of the Energy
Innovation and Carbon Dividend Act of 2021, make carbon
dividend payments to each eligible individual.
``(B) Pro-rata share.--A carbon dividend payment is
one pro-rata share for each adult, and half a pro-rata
share for each child under 19 years old, of amounts
available for the month in the Carbon Dividend Trust
Fund.
``(C) Eligible individual.--The term `eligible
individual' means, with respect to any month, any
natural living person who has a valid Social Security
number or taxpayer identification number and is a
citizen or lawful resident of the United States (other
than any individual who is a citizen of any possession
of the United States and whose bona fide residence is
outside of the United States). The Secretary is
authorized to verify an individual's eligibility to
receive a carbon dividend payment.
``(D) Fee treatment of payments.--Amounts paid
under this subsection shall be includible in gross
income.
``(E) Federal programs and federal assisted
programs.--The carbon dividend amount received by any
individual shall not be taken into account as income
and shall not be taken into account as resources for
purposes of determining the eligibility of such
individual or any other individual for benefits or
assistance, or the amount or extent of benefits or
assistance, under any Federal program or under any
State or local program financed in whole or in part
with Federal funds.
``(F) Advance payment.--The Secretary shall
transfer to the Carbon Dividend Trust Fund such amounts
as are necessary for the disbursement of an advanced
carbon dividend to all eligible individuals as follows:
``(i) An advanced carbon dividend shall be
the same as the anticipated first carbon
dividend required to be distributed under
subparagraph (A) and shall be distributed the
month prior to the first collection of the
carbon fee.
``(ii) Total amounts disbursed as advanced
carbon dividends shall be deducted from the
carbon dividends on a pro-rata basis over the
first 3 years after the disbursement of the
first carbon dividends.
``(d) Administrative Authority.--The Secretary shall promulgate
rules, guidance, and regulations useful and necessary to implement the
Carbon Dividend Trust Fund.
``(e) Assignment of Benefits.--The right of any person to any
future payment under this chapter shall not be transferable or
assignable, at law or in equity, and none of the moneys paid or payable
or rights existing under subsection (c)(3) shall be subject to
execution, levy, attachment, garnishment, or other legal process, or to
the operation of any bankruptcy or insolvency law.''.
(b) Clerical Amendment.--The table of sections for subchapter A of
chapter 98 of such Code is amended by adding at the end the following
new item:
``Sec. 9512. Carbon Dividend Trust Fund.''.
SEC. 5. LIMITED DISCLOSURE OF INFORMATION.
Section 6103(l) of the Internal Revenue Code of 1986 is amended by
adding at the end the following new paragraphs:
``(23) Limited disclosure of identity information relating
to carbon dividend payments.--
``(A) Department of treasury.--Individual identity
information shall, without written request, be open to
inspection by or disclosure to officers and employees
of the Department of the Treasury whose official duties
require such inspection or disclosure for purposes of
administering section 9512 (relating the Carbon
Dividend Trust Fund).
``(B) Commissioner of social security.--The
Commissioner of Social Security shall, on written
request, disclose to officers and employees of the
Department of the Treasury individual identity
information which has been disclosed to the Social
Security Administration as is necessary to administer
section 9512.
``(C) Restriction on disclosure.--Information
disclosed under this paragraph shall be disclosed only
for purposes of, and to the extent necessary in,
carrying out section 9512.''.
SEC. 6. NATIONAL ACADEMY OF SCIENCES REVIEW OF CARBON FEE AND EMISSIONS
REDUCTION SCHEDULE.
(a) In General.--Not later than 5 years after the date of the
enactment of this Act, the Secretary of Energy shall enter into an
agreement with the National Academy of Sciences to prepare a report
relating to the carbon fee imposed by section 9902 of the Internal
Revenue Code of 1986 and the emissions reductions schedule established
under section 9903 of such Code.
(b) Report Requirements.--Such report shall--
(1) assess the efficiency and effectiveness of the carbon
fee in achieving the emissions reduction targets set forth in
section 9903 of such Code;
(2) describe and make recommendations on whether the carbon
fee rate and annual increases prescribed by section 9902(c) of
such Code should be adjusted in order to optimize the
efficiency and effectiveness of this Act in achieving the
emissions reduction targets set forth in section 9903 of such
Code;
(3) describe the potential of the carbon fee to achieve
future emissions targets set forth in section 9903(a) of such
Code through the year 2050;
(4) describe and evaluate the effectiveness of the carbon
fee in reducing emissions from key sectors of the economy,
including sectors of the economy that have decreased their
carbon emissions, sectors of the economy that have increased
their carbon emissions, and sectors of the economy in which
carbon emissions have not changed;
(5) make findings and recommendations to Federal
departments and agencies and to Congress on actions that could
be taken to reduce carbon emissions in the sectors of the
economy in which carbon emissions have not decreased;
(6) make findings and recommendations on adjusting
regulations enacted under the Clean Air Act and other Federal
laws that affect economic sectors achieving the emissions
reduction targets set forth in section 9903 of such Code; and
(7) provide an assessment of any other factors determined
to be material to the program's efficiency and effectiveness in
achieving the goals set forth in this Act.
(c) Report Made Publicly Available.--Not later than one year after
the review in subsection (a) has commenced, the Secretary of Energy
shall submit to Congress the report required under subsection (a). Such
report shall be made electronically available to the public and open to
public comment for at least 60 days before the final submission to
Congress.
SEC. 7. IMPACT OF CARBON FEE ON BIOMASS USE AND CARBON SINKS.
(a) Study of Biomass.--The Secretary of Energy shall enter into an
agreement with the National Academy of Sciences and the Administrator
of the Environmental Protection Agency to conduct a study, make
recommendations, and submit a report regarding the impact of the carbon
fee on the use of biomass as an energy source and the resulting impacts
on carbon sinks and biodiversity.
(b) Study Requirements.--The study conducted under subsection (a)
by the National Academy of Sciences shall include analysis,
documentation, and determinations on--
(1) the carbon fee and its impact on the use of biomass as
an energy source and greenhouse gas emissions from the use of
biomass as an energy source;
(2) the impacts of the use of biomass as an energy source
on carbon sinks and biodiversity; and
(3) the various types of biomass that are being used as an
energy source.
(c) Recommendations.--Based on the findings and conclusions of the
study, the National Academy of Sciences shall make recommendations to
Federal departments and agencies and to Congress. The recommendations
shall include any actions that should be taken to mitigate impacts of
the carbon fee on--
(1) increasing greenhouse gas emissions from the use of
biomass as an energy source; and
(2) degradation of carbon sinks and biodiversity relating
to the use of biomass as an energy source.
(d) Report.--The National Academy of Sciences shall prepare a
report that includes any findings and recommendations made pursuant to
this section and, not later than 18 months after the date of the
enactment of this Act, make such report electronically available to the
public.
SEC. 8. EFFECTIVE DATE.
The amendments made by this Act shall take effect on the date of
the enactment of this Act, except the carbon fee under section 9902 of
the Internal Revenue Code of 1986 shall apply to uses, sales, or
transfers no more than 270 days after the date of the enactment of this
Act.
SEC. 9. PRINCIPLE OF INTERPRETATION.
In the case of ambiguity, the texts of this statute and its
amending texts shall be interpreted so as to allow for the most
effective abatement of greenhouse gas emissions.
SEC. 10. NO PREEMPTION OF STATE LAW.
(a) In General.--Nothing in this Act shall preempt or supersede, or
be interpreted to preempt or supersede, any State law or regulation.
(b) No Preemption of State Common Law or Statutory Causes of
Action.--Noting in this Act, nor any standard, rule, requirement, risk
evaluation, or assessment created or implemented pursuant to this Act,
shall be construed to preempt any State common law or State statutory
law creating a remedy for civil relief.
<all>
Introduced in House
Introduced in House
Referred to the Committee on Ways and Means, and in addition to the Committees on Energy and Commerce, and Foreign Affairs, 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 Ways and Means, and in addition to the Committees on Energy and Commerce, and Foreign Affairs, 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 Ways and Means, and in addition to the Committees on Energy and Commerce, and Foreign Affairs, 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.
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