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Full Text of this Amendment

SA 4853. Mr. BARRASSO submitted an amendment intended to be proposed by him to the bill S. 3036, to direct the Administrator of the Environmental Protection Agency to establish a program to decrease emissions of greenhouse gases, and for other purposes; which was ordered to lie on the table; as follows:

At the end of subtitle B of title X, add the following:
SEC. 10__. ADVANCED COAL AND SEQUESTRATION TECHNOLOGIES PROGRAM.
(a) Advanced Coal Technologies.--
(1) DEFINITIONS.--In this section:
(A) ADVANCED COAL GENERATION TECHNOLOGY.--Subject to paragraph (2), the term ``advanced coal generation technology'' means an advanced coal-fueled power plant technology that meets 1 of the following performance standards for limiting carbon dioxide emissions from an electric generation unit on an annual average basis, as determined by the Climate Change Technology Board:
(i) For an electric generation unit that is not a new entrant and that commences operation of carbon capture and sequestration equipment not later than December 31, 2015--
(I) treatment of at least the quantity of flue gas equivalent to 100 megawatts of the output of the electric generation unit; and
(II) a capability of capturing and sequestering at least 85 percent of the carbon dioxide in that flue gas.
(ii) For an electric generation unit that is not a new entrant and that commences operation of carbon capture and sequestration equipment after December 31, 2016, achievement of an average annual emission rate of not more than 1,200 pounds of carbon dioxide per megawatt-hour of net electricity generation, after subtracting the carbon dioxide that is captured and sequestered.
(iii) For a new entrant electric generation unit for which construction of the unit commenced prior to July 1, 2018, achievement of an average annual emission rate of not more than 800 pounds of carbon dioxide per megawatt-hour of net electricity generation, after subtracting the carbon dioxide that is captured and sequestered.
(iv) For a new entrant electric generation unit for which construction of the unit commenced on or after July 1, 2018, achievement of an average annual emissions rate of not more than 350 pounds of carbon dioxide per megawatt-hour of net electricity generation, after subtracting the carbon dioxide that is captured and sequestered.
(v) For any unit at a covered entity that is not an electric generation unit, achievement of an average annual emission rate that is achieved by the capture and sequestration of a minimum of 85 percent of the total carbon dioxide emissions produced by the unit.
(B) COMMENCED.--The term ``commenced'', with respect to construction, means that an owner or operator has--
(i) obtained the necessary permits to carry out a continuous program of construction; and
(ii) entered into a binding contractual obligation, with substantial financial penalties for cancellation, to undertake such a program.
(C) CONSTRUCTION.--The term ``construction'', with respect to a carbon capture and sequestration project, means the fabrication, erection, or installation of technology for the project.
(2) ADJUSTMENT OF PERFORMANCE STANDARDS.--
(A) IN GENERAL.--The Climate Change Technology Board may adjust the emission performance standards for a carbon capture and sequestration project under paragraph (1)(A) for an electric generation unit that uses subbituminous coal, lignite, or petroleum coke in significant amounts.
(B) REQUIREMENT.--If the Climate Change Technology Board adjusts a standard under subparagraph (A), the adjusted performance standard for the applicable project shall prescribe an annual emission rate that requires the project to achieve an equivalent reduction from uncontrolled carbon dioxide emissions levels from the use of subbituminous coal, lignite, or petroleum coke, as compared to the emissions the project would have achieved if that unit had combusted only bituminous coal during
the particular calendar year.
(C) APPLICABILITY OF BONUS ALLOWANCE ADJUSTMENT RATIO.--The bonus allowance adjustment ratio under section 1013(b) shall apply to an electric generation unit described in paragraph (1)(A)(i) only with respect to the megawatt-hours and carbon dioxide emissions attributable to the treated share of the flue gas of the electric generation unit.
(3) DEMONSTRATION PROJECTS AND DEPLOYMENT INCENTIVES.--
(A) IN GENERAL.--The Climate Change Technology Board shall use not less than $40,000,000,000 of amounts made available from the sale of allowances under the program to carry out this section to support demonstration projects using advanced coal generation technology, including retrofit technology that could be deployed on existing coal generation facilities, and to provide financial incentives to facilitate the deployment of not more than 20 gigawatts of advanced coal generation technologies.
(B) CERTAIN PROJECTS.--Of the amounts described in subparagraph (A), the Climate Change Technology Board shall make available up to 25 percent for projects that meet the carbon dioxide emission performance standard under paragraph (1)(A)(i).
(C) ADMINISTRATION.--In providing incentives under this paragraph, the Climate Change Technology Board shall--
(i) provide appropriate incentives for regulated investor-owned utilities, municipal utilities, electric cooperatives, and independent power producers, as determined by the Secretary of Energy; and
(ii) ensure that a range of the domestic coal types is employed in the facilities that receive incentives under this paragraph.
(D) FUNDING REQUIREMENTS.--
(i) SEQUESTRATION ACTIVITIES.--The Climate Change Technology Board shall provide incentives only to projects that meet 1 of the emission performance standards for limiting carbon dioxide described in clause (ii) or (iii) of paragraph (1)(A).
(ii) PROJECTS USING CERTAIN COALS.--In providing incentives under this paragraph, the Climate Change Technology Board shall set aside not less than 25 percent of any amounts made available to carry out this subsection for projects using coal with an energy content of not more than 10,000 British thermal units per pound.
(4) STORAGE AGREEMENT REQUIRED.--The Climate Change Technology Board shall require a binding storage agreement for the carbon dioxide captured in a project under this subsection in a geological storage project permitted by the Administrator under regulations promulgated pursuant to section 1421(d) of the Safe Drinking Water Act (42 U.S.C. 300h(d)).
(5) DISTRIBUTION OF FUNDS.--
(A) REQUIREMENT.--The Climate Change Technology Board shall make awards under this section in a manner that maximizes the avoidance or reduction of greenhouse gas emissions.
(B) INCENTIVES.--A project that receives an award under this subsection may elect 1 of the following financial incentives:
(i) A loan guarantee.
(ii) A cost-sharing grant to cover the incremental cost of installing and operating carbon capture and storage equipment (for which utilization costs may be covered for the first 10 years of operation).
(iii) Production payments of not more than 1.5 cents per kilowatt-hour of electric output during the first 10 years of commercial service of the project.
(6) LIMITATION.--A project may not receive an award under this subsection if the project receives an award under section 4402.
(b) Sequestration.--
(1) IN GENERAL.--The Climate Change Technology Board shall use not less than $10,000,000,000 of amounts made available from the sale of allowances to carry out this section for large-scale geological carbon storage demonstration projects that store carbon dioxide captured from electric generation units using coal gasification or other advanced coal combustion processes, including units that receive assistance under subsection (a).
(2) PROJECT CAPITAL AND OPERATING COSTS.--
(A) IN GENERAL.--The Climate Change Technology Board shall provide assistance under this subsection to reimburse the project owner for a percentage of the incremental project capital and operating costs of the project that are attributable to carbon capture and sequestration, as the Secretary determines to be appropriate.
(B) CERTAIN PROJECTS.--Of the assistance provided under subparagraph (A), the Climate Change Technology Board shall make available up to 25 percent for projects that meet the carbon dioxide emissions performance standard under subsection (a)(1)(A)(i).


(As printed in the Congressional Record for the Senate on Jun 4, 2008.)