Climate Change Technology Deployment and Infrastructure Credit Act of 2005 - Amends the Energy Policy Act of 1992 to direct the Director of the Office of Science and Technology Policy to develop a national strategy to promote greenhouse gas intensity reducing technologies and practices developed through research and development programs conducted by National Laboratories, other Federal research facilities, universities, and the private sector.
Directs the Secretary of Energy (Secretary) to establish: (1) an Interagency Coordinating Committee on Climate Change Technology (Committee) to coordinate Federal climate change activities and programs; (2) the Climate Change Technology Program; and (3) Climate Change Technology Working Group.
Directs the Secretary of Commerce to establish within the Department of Commerce the Climate Change Science Program.
Directs the Committee to develop and propose standards and best practices for calculating, monitoring, and analyzing greenhouse gas intensity.
Directs the Secretary to make financial assistance available to eligible project developers and project owners to supplement private sector financing for eligible projects.
Instructs the Secretary to establish a Energy Climate Credit Board to implement the greenhouse gas intensity reducing technology deployment program.
Sets forth parameters regarding Board assistance, determination of eligibility and project selection.
[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 887 Introduced in Senate (IS)]
109th CONGRESS
1st Session
S. 887
To amend the Energy Policy Act of 1992 to direct the Secretary of
Energy to carry out activities that promote the adoption of
technologies that reduce greenhouse gas intensity and to provide
credit-based financial assistance and investment protection for
projects that employ advanced climate technologies or systems, and for
other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
April 21, 2005
Mr. Hagel (for himself, Ms. Landrieu, Mr. Alexander, Mr. Pryor, Mr.
Craig, Mrs. Dole, and Ms. Murkowski) introduced the following bill;
which was read twice and referred to the Committee on Energy and
Natural Resources
_______________________________________________________________________
A BILL
To amend the Energy Policy Act of 1992 to direct the Secretary of
Energy to carry out activities that promote the adoption of
technologies that reduce greenhouse gas intensity and to provide
credit-based financial assistance and investment protection for
projects that employ advanced climate technologies or 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 ``Climate Change Technology Deployment
and Infrastructure Credit Act of 2005''.
SEC. 2. GREENHOUSE GAS INTENSITY REDUCING TECHNOLOGY STRATEGIES.
Title XVI of the Energy Policy Act of 1992 (42 U.S.C. 13381 et
seq.) is amended by adding at the end the following:
``SEC. 1610. GREENHOUSE GAS INTENSITY REDUCING STRATEGIES.
``(a) Definitions.--In this section:
``(1) Carbon sequestration.--The term `carbon
sequestration' means the capture of carbon dioxide through
terrestrial, geological, biological, or other means, which
prevents the release of carbon dioxide into the atmosphere.
``(2) Committee.--The term `Committee' means the
Interagency Coordinating Committee on Climate Change Technology
established under subsection (c)(1).
``(3) Greenhouse gas.--The term `greenhouse gas' means--
``(A) carbon dioxide;
``(B) methane;
``(C) nitrous oxide;
``(D) hydrofluorocarbons;
``(E) perfluorocarbons;
``(F) sulfur hexafluoride; and
``(G) any other gas that the Director of the Office
of Science and Technology Policy, in consultation with
the National Academy of Sciences, defines as a
greenhouse gas for purposes of this section, based on
credible scientific research.
``(4) Greenhouse gas intensity.--The term `greenhouse gas
intensity' means the ratio of greenhouse gas emissions to
economic output.
``(5) National laboratory.--The term `National Laboratory'
means a laboratory owned by the Department of Energy, including
the following:
``(A) Argonne National Laboratory.
``(B) Idaho National Laboratory.
``(C) Brookhaven National Laboratory.
``(D) Oak Ridge National Laboratory.
``(E) Los Alamos National Laboratory.
``(F) Sandia National Laboratory.
``(G) Lawrence Livermore National Laboratory.
``(H) National Energy Technology Laboratory.
``(I) National Renewable Energy Laboratory.
``(J) Pacific Northwest National Laboratory.
``(6) Working group.--The term `Working Group' means the
Climate Change Technology Working Group established under
subsection (g)(1).
``(b) Office of Science and Technology Policy Strategy.--
``(1) In general.--Based on the recommendations of the
report submitted under subsection (f)(2), the Director of the
Office of Science and Technology Policy shall develop a
national strategy to promote greenhouse gas intensity reducing
technologies and practices developed through research and
development programs conducted by National Laboratories, other
Federal research facilities, universities, and the private
sector.
``(2) Report.--The Director of the Office of Science and
Technology Policy shall annually submit to the President and
make available to the public a report on the activities carried
out in furtherance of the strategy developed under paragraph
(1).
``(c) Interagency Coordinating Committee on Climate Change
Technology.--
``(1) In general.--Not later than 180 days after the date
of enactment of this section, the Secretary shall establish an
Interagency Coordinating Committee on Climate Change Technology
to coordinate Federal climate change activities and programs
carried out in furtherance of the strategy developed under
subsection (b)(1).
``(2) Membership.--The Committee shall be composed of at
least 6 members, including--
``(A) the Secretary;
``(B) the Secretary of Commerce;
``(C) the Chairman of the Council on Environmental
Quality;
``(D) the Secretary of Agriculture;
``(E) the Administrator of the Environmental
Protection Agency; and
``(F) the Secretary of Transportation.
``(3) Staff.--The Secretary shall provide such personnel as
are necessary to enable the Committee to perform the duties of
the Committee.
``(d) Climate Change Science Program and Climate Change Technology
Program.--
``(1) Climate change science program.--Not later than 180
days after the date on which the first report is submitted
under subsection (b)(2), the Secretary of Commerce, in
cooperation with the Committee, shall establish within the
Department of Commerce the Climate Change Science Program to
assist the Committee in the interagency coordination of climate
change science research and related activities, including--
``(A) the assessments of the state of knowledge on
climate change; and
``(B) carrying out supporting studies, planning,
and analyses of the science of climate change.
``(2) Climate change technology program.--Not later than
180 days after the date on which the first report is submitted
under subsection (b)(2), the Secretary, in cooperation with the
Committee, shall establish within the Department of Energy, the
Climate Change Technology Program to assist the Committee in
the interagency coordination of climate change technology
research, development, demonstration, and deployment to reduce
greenhouse gas intensity.
``(e) Technology Inventory.--
``(1) In general.--The Secretary shall conduct an inventory
and evaluation of greenhouse gas intensity reducing
technologies that have been developed, or are under
development, by the National Laboratories to determine which
technologies are suitable for commercialization and deployment.
``(2) Report.--Not later than 180 days after the completion
of the inventory under paragraph (1), the Secretary shall
submit to the Secretary of Commerce and Congress a report that
includes the results of the completed inventory and any
recommendations of the Secretary.
``(3) Use.--The Secretary, in consultation with the
Secretary of Commerce, shall use the results of the inventory
as guidance in the commercialization of greenhouse gas
intensity reducing technologies.
``(f) Greenhouse Gas Intensity Reducing Technology Study.--
``(1) Study.--As soon as practicable after the date of
enactment of this section, the Committee shall conduct and
submit to the Secretary a study on--
``(A) the commercialization and diffusion of new
and existing technologies to reduce greenhouse gas
intensity; and
``(B) ways to increase the development and
deployment of cost-effective technologies and
practices.
``(2) Report.--Not later than 180 days after the completion
of the study under paragraph (1), the Secretary shall submit to
Congress and the Director of the Office of Science and
Technology Policy a report that describes--
``(A) the results of the study; and
``(B) any recommendations of the Committee to--
``(i) increase commercialization of the
technologies and practices described in
paragraph (1); and
``(ii) promote the long-term
commercialization and deployment of those
technologies and practices.
``(g) Climate Change Technology Working Group.--
``(1) In general.--The Secretary, in consultation with the
Committee, shall establish a Climate Change Technology Working
Group to identify statutory, regulatory, and economic barriers
to the commercialization of greenhouse gas intensity reducing
technologies and practices.
``(2) Composition.--The Working Group shall be composed of
the following members, to be appointed by the Secretary, in
consultation with the Committee:
``(A) 1 representative from each National
Laboratory.
``(B) 3 members shall be representatives of energy-
producing trade organizations.
``(C) 3 members shall represent energy-intensive
trade organizations.
``(D) 3 members shall represent groups that
represent end-use energy and other consumers.
``(E) 3 members shall be employees of the Federal
Government who are experts in energy technology,
intellectual property, tax, and regulation.
``(F) 3 members shall be representatives of
universities with expertise in energy technology
development that are recommended by the National
Academy of Engineering.
``(3) Report.--Not later than 1 year after the date of
enactment of this section and annually thereafter, the Working
Group shall submit to the Committee a report that describes--
``(A) the findings of the Working Group; and
``(B) any recommendations of the Working Group for
the removal of barriers to commercialization and
increasing the use of greenhouse gas intensity reducing
technologies.
``(4) Compensation of members.--
``(A) Non-federal employees.--A member of the
Working Group who is not an officer or employee of the
Federal Government shall be compensated at a rate equal
to the daily equivalent of the annual rate of basic pay
prescribed for level IV of the Executive Schedule under
section 5315 of title 5, United States Code, for each
day (including travel time) during which the member is
engaged in the performance of the duties of the Working
Group.
``(B) Federal employees.--A member of the Working
Group who is an officer or employee of the Federal
Government shall serve without compensation in addition
to the compensation received for the services of the
member as an officer or employee of the Federal
Government.
``(C) Travel expenses.--A member of the Working
Group shall be allowed travel expenses, including per
diem in lieu of subsistence, at rates authorized for an
employee of an agency under subchapter I of chapter 57
of title 5, United States Code, while away from the
home or regular place of business of the member in the
performance of the duties of the Commission.
``(h) Greenhouse Gas Intensity Reducing Technology Deployment.--
``(1) In general.--Based on the strategy developed under
subsection (b)(1), the technology inventory conducted under
subsection (e)(1), and the greenhouse gas intensity reducing
technology study report submitted under subsection (e)(2), the
Committee shall develop a program for implementation by the
Climate Credit Board established under section 1611(b)(2)(A)
that would provide for the removal of domestic barriers to the
deployment of greenhouse gas intensity reducing technologies.
``(2) Requirements.--In developing the program under
paragraph (1), the Committee shall consider in the aggregate--
``(A) the cost-effectiveness of the technology;
``(B) fiscal and regulatory barriers;
``(C) statutory barriers; and
``(D) intellectual property issues.
``(3) Report.--Not later than 1 year after the date of
enactment of this section, the Committee shall submit to the
President and Congress a report that--
``(A) identifies the barriers to, and the
commercial risks associated with, the deployment of
greenhouse gas intensity reducing technologies;
``(B) includes a plan for carrying out eligible
projects with Federal financial assistance under
section 1611; and
``(C) describes the program developed under
paragraph (1).
``(i) Procedures for Calculating, Monitoring, and Analyzing
Greenhouse Gas Intensity.--
``(1) In general.--Using the guidelines issued under
section 1605(b), the Committee, in collaboration with the
Administrator of the Energy Information Administration and the
National Institute of Standards and Technology, shall develop
and propose standards and best practices for calculating,
monitoring, and analyzing greenhouse gas intensity.
``(2) Content.--The standards and best practices shall
address measurement of greenhouse gas intensity by industry
sector.
``(3) Publication.--To provide the public with an
opportunity to comment on the standards and best practices
proposed under paragraph (1), the standards and best practices
shall be published in the Federal Register.
``(4) Applicable law.--To ensure that high quality
information is produced, the standards and best practices
developed under paragraph (1) shall conform to the guidelines
established under section 515 of the Treasury and General
Government Appropriations Act, 2001 (commonly known as the
`Data Quality Act') (44 U.S.C. 3516 note; 114 Stat. 2763A-
1543), as enacted into law by section 1(a)(3) of Public Law
106-554.
``(j) Demonstration Projects.--
``(1) In general.--The Secretary shall conduct and
participate in demonstration projects approved by the
Committee, including demonstration projects relating to--
``(A) coal gasification and coal liquefaction;
``(B) carbon sequestration;
``(C) cogeneration technology initiatives;
``(D) advanced nuclear power projects;
``(E) lower emission transportation;
``(F) renewable energy; and
``(G) transmission upgrades.
``(2) Criteria.--The Committee shall approve a
demonstration project under paragraph (1) if the proposed
demonstration project would--
``(A) increase the reduction of the greenhouse gas
intensity to levels below that which would be achieved
by technologies being used in the United States as of
the date of enactment of this section;
``(B) maximize the potential return on Federal
investment;
``(C) demonstrate distinct roles in public-private
partnerships;
``(D) produce a large-scale reduction of greenhouse
gas intensity if commercialization occurred; and
``(E) support a diversified portfolio to mitigate
the uncertainty associated with a single technology.
``(k) Cooperative Research and Development Agreements.--In carrying
out greenhouse gas intensity reduction research and technology
deployment, the Secretary may enter into cooperative research and
development agreements under section 12 of the Stevenson-Wydler
Technology Innovation Act of 1980 (15 U.S.C. 3710a).
``(l) Authorization of Appropriations.--There are authorized to be
appropriated such sums as are necessary to carry out this section
(other than subsection (j)).
``(m) Termination of Authority.--The authority provided by this
section terminates effective December 31, 2010.''.
SEC. 3. CLIMATE INFRASTRUCTURE CREDIT.
Title XVI of the Energy Policy Act of 1992 (42 (U.S.C. 13381 et
seq.) (as amended by section 2) is amended by adding at the end the
following:
``SEC. 1611. CLIMATE INFRASTRUCTURE CREDIT.
``(a) Definitions.--In this section:
``(1) Advanced climate technology or system.--The term
`advanced climate technology or system' means a climate
technology or system that is not in general usage as of the
date of enactment of this section.
``(2) Board.--The term `Board' means the Climate Credit
Board established under subsection (b)(2)(A).
``(3) Direct loan.--The term `direct loan' has the meaning
given the term in section 502 of the Federal Credit Reform Act
of 1990 (2 U.S.C. 661a).
``(4) Eligible project.--The term `eligible project' means
a demonstration project that is approved under section
1610(j)(1).
``(5) Eligible project cost.--The term `eligible project
cost' means any amount incurred for an eligible project that is
paid by, or on behalf of, an obligor, including the costs of--
``(A) pre-construction activities, including--
``(i) detailed project engineering and
design work;
``(ii) environmental reviews and
permitting; and
``(iii) other pre-construction activities,
as determined by the Secretary;
``(B) construction activities, including--
``(i) the acquisition of capital equipment;
``(ii) construction management; and
``(iii) construction contingencies; and
``(C) acquiring land (including any improvements to
the land) relating to the eligible project; and
``(D) financing the eligible project, including--
``(i) providing capitalized interest
necessary to meet market requirements;
``(ii) maintaining reasonably required
reserve funds;
``(iii) capital issuance expenses; and
``(iv) other carrying costs during
construction.
``(6) Federal financial assistance.--The term `Federal
financial assistance' means any credit-based financial
assistance, including a direct loan, loan guarantee, a line of
credit (which serves as standby default coverage or standby
interest coverage), production incentive payment under
subsection (g)(1)(B), or other credit-based financial
assistance mechanism for an eligible project that is--
``(A) authorized to be made available by the
Secretary for an eligible project under this section;
and
``(B) provided in accordance with the Federal
Credit Reform Act of 1990 (2 U.S.C. 661 et seq.).
``(7) Investment-grade rating.--The term `investment-grade
rating' means a rating category of BBB minus, Baa3, or higher
assigned by a rating agency for eligible project obligations
offered into the capital markets.
``(8) Lender.--The term `lender' means any non-Federal
qualified institutional buyer (as defined in section
230.144A(a) of title 17, Code of Federal Regulations (or any
successor regulation), known as Rule 144A(a) of the Securities
and Exchange Commission and issued under the Securities Act of
1933 (15 U.S.C. 77a et seq.)), including--
``(A) a qualified retirement plan (as defined in
section 4974(c) of the Internal Revenue Code of 1986)
that is a qualified institutional buyer; and
``(B) a governmental plan (as defined in section
414(d) of the Internal Revenue Code of 1986) that is a
qualified institutional buyer.
``(9) Loan guarantee.--The term `loan guarantee' means any
guarantee or other pledge by the Secretary to pay all or part
of the principal of and interest on a loan or other debt
obligation that is issued by an obligor and funded by a lender.
``(10) Obligor.--The term `obligor' means a person or
entity (including a corporation, partnership, joint venture,
trust, or governmental entity, agency, or instrumentality) that
is primarily liable for payment of the principal of, or
interest on, a Federal credit instrument.
``(11) Project obligation.--The term `project obligation'
means any note, bond, debenture, or other debt obligation
issued by an obligor in connection with the financing of an
eligible project, other than a Federal credit instrument.
``(12) Rating agency.--The term `rating agency' means a
bond rating agency identified by the Securities and Exchange
Commission as a Nationally Recognized Statistical Rating
Organization.
``(13) Regulatory failure.--The term `regulatory failure'
means a situation in which, because of a breakdown in a
regulatory process or an indefinite delay caused by a judicial
challenge to the regulatory consideration of a specific
eligible project, the Federal or State regulatory or licensing
process governing the siting, construction, or commissioning of
an eligible project does not produce a definitive determination
that the eligible project may go forward or stop within a
predetermined and prescribed time period, as determined by the
Secretary.
``(14) Secured loan.--The term `secured loan' means a loan
or other secured debt obligation issued by an obligor and
funded by the Secretary in connection with the financing of an
eligible project.
``(15) Standby default coverage.--The term `standby default
coverage' means a pledge by the Secretary to pay all or part of
the debt obligation issued by an obligor and funded by a
lender, plus all or part of obligor equity, if an eligible
project fails to receive an operating license in a period of
time established by the Secretary because of a regulatory
failure or other specific issue identified by the Secretary.
``(16) Standby interest coverage.--The term `standby
interest coverage' means a pledge by the Secretary to provide
to an obligor, at a future date and on the occurrence of 1 or
more events, a direct loan, the proceeds of which shall be used
by the obligor to maintain the current status of the obligor on
interest payments due on 1 or more loans or other project
obligations issued by an obligor and funded by a lender for an
eligible project.
``(17) Subsidy amount.--The term `subsidy amount' means the
amount of budget authority sufficient to cover the estimated
long-term cost to the Federal Government of a Federal credit
instrument issued by the Secretary to an eligible project,
calculated on a net present value basis, excluding
administrative costs and any incidental effects on governmental
receipts or outlays in accordance with the Federal Credit
Reform Act of 1990 (2 U.S.C. 661 et seq.).
``(18) Substantial completion.--The term `substantial
completion' means that an eligible project has been determined
by the Board to be in, or capable of, commercial operation.
``(b) Duties of the Secretary.--
``(1) In general.--The Secretary shall make available to
eligible project developers and eligible project owners, in
accordance with this section, such financial assistance as is
necessary to supplement private sector financing for eligible
projects.
``(2) Climate credit board.--
``(A) In general.--Not later than 120 days after
the date of enactment of this section, the Secretary
shall establish within the Department of Energy a
Climate Credit Board composed of--
``(i) the Under Secretary of Energy, who
shall serve as Chairperson;
``(ii) the Chief Financial Officer of the
Department of Energy;
``(iii) the Assistant Secretary of Energy
for Policy and International Affairs;
``(iv) the Assistant Secretary of Energy
for Energy Efficiency and Renewable Energy; and
``(v) such other individuals as the
Secretary determines to have the experience and
expertise (including expertise in corporate and
project finance and the energy sector)
necessary to carry out the duties of the Board.
``(B) Duties.--The Board shall--
``(i) implement the program developed under
section 1610(h)(1) in accordance with paragraph
(3);
``(ii) issue regulations and criteria in
accordance with paragraph (4);
``(iii) conduct negotiations with
individuals and entities interested in
obtaining assistance under this section;
``(iv) recommend to the Secretary potential
recipients and amounts of grants of assistance
under this section;
``(v) carry out such other projects and
activities as the Interagency Coordinating
Committee on Climate Change Technology may
recommend; and
``(vi) establish metrics to indicate the
progress of the greenhouse gas intensity
reducing technology deployment program and
individual projects carried out under the
program toward meeting the criteria established
by section 1610(j)(2).
``(3) Greenhouse gas intensity reducing technology
deployment program.--Not later than 1 year after the date of
enactment of this section, the Board shall implement the
greenhouse gas intensity reducing technology deployment program
developed under section 1610(h)(1).
``(4) Regulations and criteria.--
``(A) In general.--Not later than 1 year after the
date of enactment of this section, the Board shall
issue and publish in the Federal Register such
regulations and criteria as are necessary to implement
this section.
``(B) Requirements.--The regulations and criteria
shall provide for, at a minimum--
``(i) a competitive process and the general
terms and conditions for the provision of
assistance under this section;
``(ii) the procedures by which eligible
project owners and eligible project developers
may request financial assistance under this
section; and
``(iii) the collection of any other
information necessary for the Secretary to
carry out this section, including a process for
negotiating the terms and conditions of
assistance provided under this section.
``(C) Eligibility and criteria.--The determination
of eligibility of, and criteria for selecting, eligible
projects to receive assistance under this section shall
be carried out in accordance with subsection (c).
``(D) Conditions for provision of assistance.--The
Board shall not provide assistance under this section
unless the Board determines that the terms, conditions,
maturity, security, schedule, and amounts of repayments
of the assistance are reasonable and meet such
standards as the Board determines are appropriate to
protect the financial interests of the United States.
``(5) Reports to the president and congress.--Not later
than 4 years after the date of enactment of this section, and
every 2 years thereafter, the Board shall submit to the
Secretary, for transmittal to the President and Congress, a
report that describes--
``(A) the progress in carrying out this section;
``(B) the financial performance of the eligible
projects that are receiving, or have received,
assistance under this section as of the date of the
report; and
``(C) the progress and value to the United States
of the program under this section, including a
recommendation as to whether the objectives of this
section are best served by--
``(i) continuing the program under the
authority of the Secretary;
``(ii) establishing a Federal Government
corporation or Federal Government-sponsored
enterprise to administer the program; or
``(iii) phasing out the program and relying
on the capital markets to fund the kinds of
energy infrastructure investments assisted by
this section without Federal participation.
``(6) Confidentiality.--The Board shall protect the
confidentiality of any information provided by an applicant for
assistance under this section that the applicant certifies to
be commercially sensitive or that is protected intellectual
property.
``(c) General Requirements Regarding Assistance, Determination of
Eligibility, and Project Selection.--
``(1) In general.--The Board shall not provide assistance
to an eligible project under this section unless the Board
first determines that the amount of assistance to be provided
for the eligible project is not greater than the amount of
assistance required to achieve the criteria established under
section 1610(j)(2) with respect to the eligible project.
``(2) Eligibility.--To be eligible to receive assistance
under this section, an eligible project shall, as determined by
the Board--
``(A) be supported by an application that contains
all information required to be included by, and is
submitted to and approved by the Board in accordance
with, the regulations and criteria issued by the Board
under subsection (b)(4);
``(B) be nationally or regionally significant by--
``(i) reducing greenhouse gas intensity;
``(ii) generating economic benefits;
``(iii) contributing to energy security;
``(iv) contributing to energy and
technology diversity in the energy economy of
the United States;
``(v) contributing to energy and
electricity price stability; or
``(vi) otherwise enhancing national or
regional energy efficiency, reliability, and
robustness of performance;
``(C) contain an advanced climate technology or
system that could--
``(i) significantly improve the efficiency,
security, reliability, and environmental
performance of the energy economy of the United
States; and
``(ii) reduce greenhouse gas emissions;
``(D) have revenue sources dedicated to repayment
of credit support-based project financing, such as
revenue--
``(i) from the sale of sequestered carbon;
``(ii) from the sale of energy,
electricity, or other products from eligible
projects that employ advanced climate
technologies and systems;
``(iii) from the sale of transportation of
commerce;
``(iv) from the sale of electricity or
generating capacity, in the case of electricity
infrastructure;
``(v) from the sale or transmission of
energy;
``(vi) associated with energy efficiency
gains, in the case of other energy projects; or
``(vii) from other dedicated revenue
sources;
``(E) include a project proposal and agreement for
project financing repayment that demonstrates to the
satisfaction of the Board that the dedicated revenue
sources described in subparagraph (D) will be adequate
to repay project financing provided under this section;
``(F) reduce greenhouse gas intensity on a national
or regional basis; and
``(G) if the eligible project involves new
transmission capacity, link to low-emission projects.
``(3) Limitations.--Except as otherwise provided in this
section--
``(A) the total cost of an eligible project
provided Federal financial assistance under this
section shall be at least $40,000,000;
``(B) the Federal share of an eligible project
provided Federal financial assistance under this
section shall be not more than 20 percent of the total
cost of carrying out the eligible project;
``(C) not more than $200,000,000 in Federal
financial assistance shall be provided to any
individual eligible project; and
``(D) an eligible project shall not be eligible for
financial assistance from any other Federal program
during any period that Federal financial assistance is
provided to the eligible project under this section.
``(4) Selection among eligible projects.--
``(A) Establishment of selection criteria.--The
Board shall establish criteria for selecting which
eligible projects will receive assistance under this
section.
``(B) Requirements.--The selection criteria shall
include a determination by the Board of the extent to
which--
``(i) the eligible project reduces
greenhouse gas intensity beyond reductions
achieved by technology available as of October
15, 1992;
``(ii) financing for the eligible project
has appropriate security features, such as a
rate covenant, to ensure repayment;
``(iii) assistance under this section for
the eligible project would foster innovative
public-private partnerships and attract private
debt or equity investment;
``(iv) assistance under this section for an
eligible project would enable the eligible
project to proceed at an earlier date than
would otherwise be practicable;
``(v) the eligible project uses new
technologies that enhance the efficiency,
reduce the environmental impact, improve the
reliability, or improve the safety, of the
eligible project;
``(vi) the eligible project helps to
maintain or protect the environment, especially
with respect to having a low level of emissions
to the atmosphere;
``(vii) assistance for the eligible project
provided under this section could reduce the
contribution of other Federal grant or funding
assistance to the eligible project; and
``(viii) the eligible project is nationally
or regionally significant in terms of
generating economic benefits, supporting
international commerce, or otherwise enhancing
national energy efficiency, security,
reliability, robustness, and environmental
performance.
``(C) Financial information.--An application for
assistance for an eligible project under this section
shall include such information as the Secretary
determines to be necessary concerning--
``(i) the amount of budget authority
required to fund the Federal credit instrument
requested for the eligible project;
``(ii) the estimated construction costs of
the proposed eligible project;
``(iii) estimates of construction and
operating costs of the eligible project;
``(iv) projected revenues from the eligible
project; and
``(v) any other financial aspects of the
eligible project, including assurances, that
the Board determines to be appropriate.
``(D) Preliminary rating opinion letter.--The Board
shall require each applicant seeking assistance for an
eligible project under this section to provide a
preliminary rating opinion letter from at least 1
credit rating agency indicating that the senior
obligations of the eligible project have the potential
to achieve an investment-grade rating.
``(E) Risk assessment.--Before entering into any
agreement to provide assistance for an eligible project
under this section, the Board, in consultation with the
Secretary, the Director of the Office of Management and
Budget, and each credit rating agency providing a
preliminary rating opinion letter under subparagraph
(D), shall determine and maintain an appropriate
capital reserve subsidy amount for each line of credit
established for the eligible project, taking into
account the information contained in the preliminary
rating opinion letter.
``(F) Investment-grade rating requirement.--
``(i) In general.--The funding of any
assistance under this section shall be
contingent on the senior obligations of the
eligible project receiving an investment-grade
rating from at least 1 credit rating agency.
``(ii) Considerations.--In determining
whether an investment-grade rating is
appropriate under clause (i), the credit rating
agency shall take into account the availability
of Federal financial assistance under this
section.
``(5) Maximum available climate credit support.--
Notwithstanding any assistance limitation under any other
provision of this section, the Secretary shall not provide
energy credit support to any eligible project in the form of a
secured loan or loan guarantee under subsection (f), production
incentive payments under subsection (g), or other credit-based
financial assistance under subsection (h), the combined total
of which exceeds 20 percent of eligible project costs,
excluding the value of standby default coverage under
subsection (d) and standby interest coverage under subsection
(e), as determined by the Secretary.
``(d) Standby Default Coverage.--
``(1) Agreements; use of proceeds.--
``(A) Agreements.--
``(i) In general.--Subject to subparagraph
(B), the Board, in consultation with the
Secretary, may enter into agreements to provide
standby default coverage for advanced climate
technologies or systems of an eligible project.
``(ii) Recipients.--Coverage under clause
(i) may be provided to 1 or more obligors and
debt holders to be triggered at future dates on
the occurrence of certain events for any
eligible project selected under subsection (c).
``(B) Use of proceeds.--The proceeds of standby
default coverage made available under this subsection
shall be available to reimburse all or part of the debt
obligation for an eligible project issued by an obligor
and funded by a lender, plus all or part of obligor
equity, in the event that, because of a regulatory
failure or other event specified by the Secretary
pursuant to this section, an eligible advanced climate
technology or system for an eligible project fails to
receive an operating license in a period of time
specified by the Board in accordance with this
subsection.
``(2) Terms and limitations.--
``(A) In general.--Standby default coverage under
this subsection with respect to an eligible project
shall be on such terms and conditions and contain such
covenants, representations, warranties, and
requirements (including requirements for audits) as the
Board determines to be appropriate.
``(B) Maximum amounts.--The total amount of standby
default coverage provided for an eligible project shall
not exceed 100 percent of the reasonably anticipated
eligible project costs, including debt and equity.
``(C) Exercise.--Any exercise on the standby
default coverage shall be made only if a facility
involved with the eligible project fails, because of
regulatory failure or other specific issues specified
by the Secretary, to receive an operating license by
such deadline as the Secretary shall establish.
``(D) Cost of coverage.--The cost of standby
default coverage shall be assumed by the Secretary
subject to the risk assessment calculation required
under subsection (c)(4)(E) and the availability of
funds for that purpose.
``(E) Fees.--In carrying out this section, the
Secretary may--
``(i) establish fees at a level sufficient
to cover all or a portion of the administrative
costs incurred by the Federal Government in
providing standby default coverage under this
subsection; and
``(ii) require that the fees be paid upon
application for a standby default coverage
agreement under this subsection.
``(F) Period of availability.--In the event that
regulatory approval to operate a facility is suspended
as a result of regulatory failure or other
circumstances specified by the Secretary, standby
default coverage shall be available beginning on the
date of substantial completion and ending not later
than 5 years after the date on which operation of the
facility is scheduled to commence.
``(G) Rights of third-party creditors.--
``(i) Against federal government.--A third-
party creditor of an obligor shall not have any
right against the Federal Government with
respect to any amounts other than those
specified in subparagraph (B).
``(ii) Assignment.--An obligor may assign
all or part of the standby default coverage for
an eligible project to 1 or more lenders or to
a trustee on behalf of the lenders.
``(H) Result of exercise of standby default
coverage.--If standby default coverage is exercised by
the obligor of an eligible project--
``(i) the Federal Government shall become
the sole owner of the eligible project, with
all rights and appurtenances to the eligible
project; and
``(ii) the Board shall dispose of the
assets of the eligible project on terms that
are most favorable to the Federal Government,
which may include continuing to licensing and
commercial operation or resale of the eligible
project, in whole or in part, if that is the
best course of action in the judgment of the
Board.
``(I) Estimate of assets at time of termination.--
If standby default coverage is exercised and an
eligible project is terminated, the Board, in making a
determination of whether to dispose of the assets of
the eligible project or continue the eligible project
to licensing and commercial operation, shall obtain a
fair and impartial estimate of the eligible project
assets at the time of termination.
``(J) Relationship to other credit instruments.--An
eligible project that receives standby default coverage
under this subsection may receive a secured loan or
loan guarantee under subsection (f), production
incentive payments under subsection (g), or assistance
through a credit-based financial assistance mechanism
under subsection (h).
``(K) Other conditions and requirements.--The
Secretary may impose such other conditions and
requirements in connection with any insurance provided
under this subsection (including requirements for
audits) as the Secretary determines to be appropriate.
``(e) Standby Interest Coverage.--
``(1) In general.--
``(A) Agreements.--Subject to subparagraph (B), the
Board may enter into agreements to make standby
interest coverage available to 1 or more obligors in
the form of loans for advanced climate or energy
technologies or systems to be made by the Board at
future dates on the occurrence of certain events for
any eligible project selected under subsection (c)(4).
``(B) Use of proceeds.--Subject to subsection
(c)(3), the proceeds of standby interest coverage made
available under this subsection shall be available to
pay the debt service on project obligations issued to
finance eligible project costs of an eligible project
if a delay in commercial operations occurs due to a
regulatory failure or other condition determined by the
Secretary.
``(2) Terms and limitations.--
``(A) In general.--Standby interest coverage under
this subsection with respect to an eligible project
shall be made on such terms and conditions (including a
requirement for an audit) as the Secretary determines
appropriate.
``(B) Maximum amounts.--
``(i) Total amount.--The total amount of
standby interest coverage for an eligible
project under this subsection shall not exceed
20 percent of the reasonably anticipated
eligible project costs of the eligible project.
``(ii) 1-year draws.--The amount drawn in
any 1 year for an eligible project under this
subsection shall not exceed 20 percent of the
total amount of the standby interest coverage
for the eligible project.
``(C) Period of availability.--The standby interest
coverage for an eligible project shall be available
during the period--
``(i) beginning on a date following
substantial completion of the eligible project
that regulatory approval to operate a facility
under the eligible project is suspended as a
result of regulatory failure or other condition
determined by the Secretary; and
``(ii) ending on a date that is not later
than 5 years after the eligible project is
scheduled to commence commercial operations.
``(D) Cost of coverage.--Subject to subsection
(c)(4)(E), the cost of standby interest coverage for an
eligible project under this subsection shall be borne
by the Secretary.
``(E) Draws.--Any draw on the standby interest
coverage for an eligible project shall--
``(i) represent a loan;
``(ii) be made only if there is a delay in
commercial operations after the substantial
completion of the eligible project; and
``(iii) be subject to the overall credit
support limitations established under
subsection (c)(5).
``(F) Interest rate.--
``(i) In general.--Subject to clause (ii),
the interest rate on a loan resulting from a
draw on standby interest coverage under this
subsection shall be established by the
Secretary.
``(ii) Minimum rate.--The interest rate on
a loan resulting from a draw on standby
interest coverage under this subsection shall
not be less than the current average market
yield on outstanding marketable obligations of
the United States with a maturity of 10 years,
as of the date on which the standby interest
coverage is obligated.
``(G) Security.--The standby interest coverage for
an eligible project--
``(i) shall be payable, in whole or in
part, from dedicated revenue sources generated
by the eligible project;
``(ii) shall require security for the
project obligations; and
``(iii) may have a lien on revenues
described in clause (i), subject to any lien
securing project obligations.
``(H) Rights of third-party creditors.--
``(i) Against federal government.--A third-
party creditor of the obligor shall not have
any right against the Federal Government with
respect to any draw on standby interest
coverage under this subsection.
``(ii) Assignment.--An obligor may assign
the standby interest coverage to 1 or more
lenders or to a trustee on behalf of the
lenders.
``(I) Subordination.--A secured loan for an
eligible project made under this subsection shall be
subordinate to senior private debt issued by a lender
for the eligible project.
``(J) Nonrecourse status.--A secured loan for an
eligible project under this subsection shall be
nonrecourse to the obligor in the event of bankruptcy,
insolvency, or liquidation of the eligible project.
``(K) Fees.--The Board may impose fees at a level
sufficient to cover all or part of the costs to the
Federal Government of providing standby interest
coverage for an eligible project under this subsection.
``(3) Repayment.--
``(A) Terms and conditions.--The Secretary shall
establish a repayment schedule and terms and conditions
for each loan for an eligible project under this
subsection based on the projected cash flow from
revenues for the eligible project.
``(B) Repayment schedule.--Scheduled repayments of
principal or interest on a loan under this subsection
shall--
``(i) commence not later than 5 years after
the end of the period of availability specified
in paragraph (2)(C); and
``(ii) be completed, with interest, not
later than 10 years after the end of the period
of availability.
``(C) Sources of repayment funds.--The sources of
funds for scheduled loan repayments under this
subsection shall include--
``(i) the sale of electricity or generating
capacity;
``(ii) the sale or transmission of energy;
``(iii) revenues associated with energy
efficiency gains; or
``(iv) other dedicated revenue sources,
such as carbon use.
``(D) Prepayment.--
``(i) Use of excess revenues.--At the
discretion of the obligor, any excess revenues
that remain after satisfying scheduled debt
service requirements on the project obligations
and secured loan, and all deposit requirements
under the terms of any trust agreement, bond
resolution, or similar agreement securing
project obligations, may be applied annually to
prepay the secured loan without penalty.
``(ii) Use of proceeds of refinancing.--The
secured loan may be prepaid at any time without
penalty from the proceeds of refinancing from
non-Federal funding sources.
``(f) Secured Loans and Loan Guarantees.--
``(1) In general.--
``(A) Agreements.--Subject to subparagraph (B), the
Board may enter into agreements with 1 or more obligors
to make secured loans for eligible projects involving
advanced climate technologies or systems.
``(B) Use of proceeds.--Subject to paragraph (2),
the proceeds of a secured loan for an eligible project
made available under this subsection shall be
available, in conjunction with the equity of the
obligor and senior debt financing for the eligible
project, to pay for eligible project costs.
``(2) Terms and limitations.--
``(A) In general.--A secured loan under this
subsection with respect to an eligible project shall be
made on such terms and conditions (including
requirements for an audit) as the Board, in
consultation with the Secretary, determines
appropriate.
``(B) Maximum amount.--Subject to subsection
(c)(5), the total amount of the secured loan for an
eligible project under this subsection shall not exceed
20 percent of the reasonably anticipated eligible
project costs of the eligible project.
``(C) Period of availability.--The Board may enter
into a contract with the owner or operator of an
eligible project to provide a secured loan during the
period--
``(i) beginning on the date that the
financial structure of the eligible project is
established; and
``(ii) ending on the date of the start of
construction of the eligible project.
``(D) Cost of coverage.--Subject to subsection
(c)(4)(E), the cost of a secured loan for an eligible
project under this subsection shall be borne by the
Secretary.
``(E) Interest rate.--
``(i) In general.--Subject to clause (ii),
the interest rate on a secured loan under this
subsection shall be established by the
Secretary.
``(ii) Minimum rate.--The interest rate on
a loan resulting from a secured loan under this
subsection shall not be less than the current
average market yield on outstanding marketable
obligations of the United States of comparable
maturity, as of the date of the execution of
the loan agreement.
``(F) Security.--The secured loan--
``(i) shall be payable, in whole or in
part, from dedicated revenue sources generated
by the eligible project;
``(ii) shall include a rate covenant,
coverage requirement, or similar security
feature supporting the project obligations; and
``(iii) may have a lien on revenues
described in clause (i), subject to any lien
securing project obligations.
``(G) Rights of third-party creditors.--
``(i) Against federal government.--A third-
party creditor of the obligor shall not have
any right against the Federal Government with
respect to any payments due to the Federal
Government under this subsection.
``(ii) Assignment.--An obligor may assign
the secured loan to 1 or more lenders or to a
trustee on behalf of the lenders.
``(H) Subordination.--A secured loan for an
eligible project made under this subsection shall be
subordinate to senior private debt issued by a lender
for the eligible project.
``(I) Nonrecourse status.--A secured loan for an
eligible project under this subsection shall be non-
recourse to the obligor in the event of bankruptcy,
insolvency, or liquidation of the eligible project.
``(J) Fees.--The Board may establish fees at a
level sufficient to cover all or a portion of the costs
to the Federal Government of making secured loans for
an eligible project under this subsection.
``(3) Repayment.--
``(A) Schedule and terms.--The Board shall
establish a repayment schedule and terms and conditions
for each secured loan for an eligible project under
this subsection based on the projected cash flow from
revenues for the eligible project.
``(B) Repayment schedule.--Scheduled repayments on
a secured loan for an eligible project under this
subsection shall--
``(i) commence not later than 5 years after
the scheduled start of commercial operations of
the eligible project; and
``(ii) be completed, with interest, not
later than 35 years after the scheduled date of
the start of commercial operations of the
eligible project.
``(C) Sources of repayment funds.--The sources of
funds for scheduled loan repayments under this
subsection shall include--
``(i) the sale of carbon or carbon
compounds;
``(ii) the sale of electricity or
generating capacity;
``(iii) the sale of sequestration services;
``(iv) the sale or transmission of energy;
``(v) revenues associated with energy
efficiency gains; or
``(vi) other dedicated revenue sources.
``(D) Deferred payments.--
``(i) Authorization.--If, at any time
during the 10-year period beginning on the date
of the scheduled start of commercial operation
of an eligible project, the eligible project is
unable to generate sufficient revenues to pay
the scheduled loan repayments of principal or
interest on the secured loan, the Secretary
may, subject to clause (iii), allow the obligor
to add unpaid principal or interest to the
outstanding balance of the secured loan.
``(ii) Interest.--Any payment deferred
under clause (i) shall--
``(I) continue to accrue interest
in accordance with paragraph (2)(E)
until fully repaid; and
``(II) be scheduled to be amortized
over the number of years remaining in
the term of the loan in accordance with
subparagraph (B).
``(iii) Criteria.--
``(I) In general.--Any payment
deferral under clause (i) shall be
contingent on the eligible project
meeting criteria established by the
Secretary.
``(II) Repayment standards.--The
criteria established under subclause
(I) shall include standards for
reasonable assurance of repayment.
``(E) Prepayment.--
``(i) Use of excess revenues.--At the
discretion of the obligor, any excess revenues
that remain after satisfying scheduled debt
service requirements on the project obligations
and secured loan, and all deposit requirements
under the terms of any trust agreement, bond
resolution, or similar agreement securing
project obligations, may be applied annually to
prepay the secured loan without penalty.
``(ii) Use of proceeds of refinancing.--The
secured loan may be prepaid at any time without
penalty from the proceeds of refinancing from
non-Federal funding sources.
``(4) Sale of secured loans.--
``(A) In general.--Subject to subparagraph (B), as
soon as practicable after substantial completion of an
eligible project and after notifying the obligor, the
Board may sell to another entity or reoffer into the
capital markets a secured loan for the eligible project
if the Board determines that the sale or reoffering can
be made on favorable terms.
``(B) Consent of obligor.--In making a sale or
reoffering under subparagraph (A), the Board may not
change the original terms and conditions of the secured
loan without the written consent of the obligor.
``(5) Loan guarantees.--
``(A) In general.--The Board may provide a loan
guarantee to a lender, in lieu of making a secured
loan, under this subsection if the Board determines
that the budgetary cost of the loan guarantee is
substantially the same as that of a secured loan.
``(B) Terms.--
``(i) In general.--Except as provided in
clause (ii), the terms of a guaranteed loan
shall be consistent with the terms for a
secured loan under this subsection.
``(ii) Interest rate; prepayment.--The
interest rate on the guaranteed loan and any
prepayment features shall be established by
negotiations between the obligor and the
lender, with the consent of the Board.
``(g) Production Incentive Payments.--
``(1) Secured loan.--
``(A) In general.--The Secretary may enter into an
agreement with 1 or more obligors to make a secured
loan for an eligible project selected under subsection
(c)(4) that employs 1 or more advanced climate
technologies or systems.
``(B) Production incentive payments.--
``(i) In general.--Amounts loaned to an
obligor under subparagraph (A) shall be made
available in the form of a series of production
incentive payments provided by the Board to the
obligor during a period of not more than 10
years, as determined by the Board, beginning
after the date on which commercial project
operations start at the eligible project.
``(ii) Amount.--Production incentive
payments under clause (i) shall be for an
amount equal to 20 percent of the value of--
``(I) the energy produced or
transmitted by the eligible project
during the applicable year; or
``(II) any gains in energy
efficiency achieved by the eligible
project during the applicable year.
``(2) Terms and limitations.--
``(A) In general.--A secured loan under this
subsection shall be subject to such terms and
conditions, including any covenant, representation,
warranty, and requirement (including a requirement for
an audit) that the Secretary determines to be
appropriate.
``(B) Agreement costs.--Subject to subsection
(c)(4), the cost of carrying out an agreement entered
into under paragraph (1)(A) shall be paid by the
Secretary.
``(C) Interest rate.--
``(i) In general.--Subject to clause (ii),
the interest rate on a secured loan under this
subsection shall be established by the
Secretary.
``(ii) Minimum rate.--The interest rate on
a secured loan under this subsection shall not
be less than the current average market yield
on outstanding marketable obligations of the
United States of comparable maturity, as of the
date on which the agreement under paragraph
(1)(A) is executed.
``(D) Security.--The secured loan--
``(i) shall be payable, in whole or in
part, from dedicated revenue sources generated
by the eligible project;
``(ii) shall include a rate covenant,
coverage requirement, or similar security
feature supporting the eligible project
obligations; and
``(iii) may have a lien on revenues
described in clause (i), subject to any lien
securing eligible project obligations.
``(E) Rights of third-party creditors.--
``(i) Against federal government.--A third-
party creditor of the obligor shall not have
any right against the Federal Government with
respect to any payments due to the Federal
Government under the agreement entered into
under paragraph (1)(A).
``(ii) Assignment.--An obligor may assign
production incentive payments to 1 or more
lenders or to a trustee on behalf of the
lenders.
``(F) Subordination.--A secured loan under this
subsection shall be subordinate to senior private debt
issued by a lender for the eligible project.
``(G) Nonrecourse status.--A secured loan under
this subsection shall be nonrecourse to the obligor in
the event of bankruptcy, insolvency, or liquidation of
the eligible project.
``(H) Fees.--The Secretary may impose fees at a
level sufficient to cover all or part of the costs to
the Federal Government of providing production
incentive payments under this subsection.
``(3) Repayment.--
``(A) Schedule, terms, and conditions.--The
Secretary shall establish a repayment schedule and
terms and conditions for each secured loan under this
subsection based on the projected cash flow from
revenues of the eligible project.
``(B) Repayment schedule.--Scheduled repayments of
principal or interest on a secured loan under this
subsection shall--
``(i) commence not later than 5 years after
the date on which the last production incentive
payment is made by the Board under paragraph
(1)(B); and
``(ii) be completed, with interest, not
later than 10 years after the date on which the
last production incentive payment is made.
``(C) Sources of repayment funds.--The sources of
funds for scheduled loan repayments under this
subsection include--
``(i) the sale of electricity or generating
capacity,
``(ii) the sale or transmission of energy;
``(iii) revenues associated with energy
efficiency gains; or
``(iv) other dedicated revenue sources.
``(D) Deferred payments.--
``(i) Authorization.--If, at any time
during the 10-year period beginning on the date
on which commercial operations of the eligible
project start, the eligible project is unable
to generate sufficient revenues to pay the
scheduled loan repayments of principal or
interest on a secured loan under this
subsection, the Secretary may, subject to
criteria established by the Secretary
(including standards for reasonable assurances
of repayment), allow the obligor to add unpaid
principal and interest to the outstanding
balance of the secured loan.
``(ii) Interest.--Any payment deferred
under clause (i) shall--
``(I) continue to accrue interest
in accordance with paragraph (2)(C)
until fully repaid; and
``(II) be scheduled to be amortized
over the number of years remaining in
the term of the loan in accordance with
subparagraph (B).
``(E) Prepayment.--
``(i) Use of excess revenues.--At the
discretion of the obligor, any excess revenues
that remain after satisfying scheduled debt
service requirements on the eligible project
obligations and the secured loan, and all
deposit requirements under the terms of any
trust agreement, bond resolution, or similar
agreement securing eligible project
obligations, may be applied annually to prepay
loans pursuant to an agreement entered into
under paragraph (1)(A) without penalty.
``(ii) Use of proceeds of refinancing.--The
secured loan may be prepaid at any time without
penalty from the proceeds of refinancing from
non-Federal funding sources.
``(4) Sale of secured loans.--
``(A) In general.--Subject to subparagraph (B), as
soon as practicable after the date on which the last
production incentive payment is made to the obligor
under paragraph (1)(B) and after notifying the obligor,
the Secretary may sell to another entity or reoffer
into the capital markets a secured loan for the
eligible project if the Secretary determines that the
sale or reoffering can be made on favorable terms.
``(B) Consent required.--In making a sale or
reoffering under subparagraph (A), the Board may not
change the original terms and conditions of the secured
loan without the written consent of the obligor.
``(h) Other Credit-Based Financial Assistance Mechanisms for
Eligible Projects.--
``(1) In general.--
``(A) Agreements.--The Board may enter into an
agreement with 1 or more obligors to make a secured
loan to the obligors for eligible projects selected
under subsection (c) that employ advanced technologies
or systems, the proceeds of which shall be used to--
``(i) finance eligible project costs; or
``(ii) enhance eligible project revenues.
``(B) Credit-based financial assistance.--Amounts
made available as a secured loan under subparagraph (A)
shall be provided by the Board to the obligor in the
form of credit-based financial assistance mechanisms
that are not otherwise specifically provided for in
subsections (d) through (g), as determined to be
appropriate by the Secretary.
``(2) Terms and limitations.--
``(A) In general.--A secured loan under this
subsection shall be subject to such terms and
conditions (including any covenants, representations,
warranties, and requirements (including a requirement
for an audit)) as the Secretary determines to be
appropriate.
``(B) Maximum amount.--Subject to subsection
(c)(5), the total amount of the secured loan under this
subsection shall not exceed 50 percent of the
reasonably anticipated eligible project costs.
``(C) Period of availability.--The Board may enter
into a contract with the obligor to provide credit-
based financial assistance to an eligible project
during the period--
``(i) beginning on the date that the
financial structure of the eligible project is
established; and
``(ii) ending on the date of the start of
construction of the eligible project.
``(D) Agreement costs.--Subject to subsection
(c)(4)(E), the cost of carrying out an agreement
entered into under paragraph (1)(A) shall be paid by
the Board.
``(E) Interest rate.--
``(i) In general.--Subject to clause (ii),
the interest rate on a secured loan under this
subsection shall be established by the Board.
``(ii) Minimum rate.--The interest rate on
a secured loan under this subsection shall not
be less than the current average market yield
on outstanding marketable obligations of the
United States of comparable maturity, as of the
date of the execution of the secured loan
agreement.
``(F) Security.--The secured loan--
``(i) shall be payable, in whole or in
part, from dedicated revenue sources generated
by the eligible project;
``(ii) shall include a rate covenant,
coverage requirement, or similar security
feature supporting the eligible project
obligations; and
``(iii) may have a lien on revenues
described in clause (i), subject to any lien
securing eligible project obligations.
``(G) Rights of third-party creditors.--
``(i) Against federal government.--A third-
party creditor of the obligor shall not have
any right against the Federal Government with
respect to any payments due to the Federal
Government under this subsection.
``(ii) Assignment.--An obligor may assign
payments made pursuant to an agreement to
provide credit-based financial assistance under
this subsection to 1 or more lenders or to a
trustee on behalf of the lenders.
``(H) Subordination.--A secured loan under this
subsection shall be subordinate to senior private debt
issued by a lender for the eligible project.
``(I) Nonrecourse status.--A secured loan under
this subsection shall be nonrecourse to the obligor in
the event of bankruptcy, insolvency, or liquidation of
the eligible project.
``(J) Fees.--The Board may establish fees at a
level sufficient to cover all or part of the costs to
the Federal Government of providing credit-based
financial assistance under this subsection.
``(3) Repayment.--
``(A) Schedule and terms and conditions.--The Board
shall establish a repayment schedule and terms and
conditions for each secured loan under this subsection
based on the projected cash flow from eligible project
revenues.
``(B) Repayment schedule.--Scheduled loan
repayments of principal or interest on a secured loan
under this subsection shall--
``(i) commence not later than 5 years after
the date of substantial completion of the
eligible project; and
``(ii) be completed, with interest, not
later than 35 years after the date of
substantial completion of the eligible project.
``(C) Sources of repayment funds.--The sources of
funds for scheduled loan repayments under this
subsection shall include--
``(i) the sale of electricity or generating
capacity;
``(ii) the sale or transmission of energy;
``(iii) revenues associated with energy
efficiency gains; or
``(iv) other dedicated revenue sources,
such as carbon sequestration.
``(D) Deferred payments.--
``(i) Authorization.--If, at any time
during the 10-year period beginning on the date
of the start of commercial operations of the
eligible project, the eligible project is
unable to generate sufficient revenues to pay
the scheduled loan repayments of principal or
interest on a secured loan under this
subsection, the Secretary may, subject to
criteria established by the Secretary
(including standards for reasonable assurances
of repayment), allow the obligor to add unpaid
principal and interest to the outstanding
balance of the secured loan.
``(ii) Interest.--Any payment deferred
under clause (i) shall--
``(I) continue to accrue interest
in accordance with paragraph (2)(E)
until fully repaid; and
``(II) be scheduled to be amortized
over the number of years remaining in
the term of the loan in accordance with
subparagraph (B).
``(E) Prepayment.--
``(i) Use of excess revenues.--At the
discretion of the obligor, any excess revenues
that remain after satisfying scheduled debt
service requirements on the eligible project
obligations and secured loan, and all deposit
requirements under the terms of any trust
agreement, bond resolution, or similar
agreement securing eligible project
obligations, may be applied annually to prepay
a secured loan under this subsection without
penalty.
``(ii) Use of proceeds of refinancing.--A
secured loan under this subsection may be
prepaid at any time without penalty from the
proceeds of refinancing from non-Federal
funding sources.
``(4) Sale of secured loans.--
``(A) In general.--Subject to subparagraph (B), as
soon as practicable after the start of commercial
operations of an eligible project and after notifying
the obligor, the Board may sell to another entity or
reoffer into the capital markets a secured loan for the
eligible project under this subsection if the Secretary
determines that the sale or reoffering can be made on
favorable terms.
``(B) Consent of obligor.--In making a sale or
reoffering under subparagraph (A), the Board may not
change the original terms and conditions of the secured
loan without the written consent of the obligor.
``(i) Federal, State, and Local Regulatory Requirements.--The
provision of Federal financial assistance to an eligible project under
this section shall not--
``(1) relieve any recipient of the assistance of any
obligation to obtain any required Federal, State, or local
regulatory requirement, permit, or approval with respect to the
eligible project;
``(2) limit the right of any unit of Federal, State, or
local government to approve or regulate any rate of return on
private equity invested in the eligible project; or
``(3) otherwise supersede any Federal, State, or local law
(including any regulation) applicable to the construction or
operation of the eligible project.
``(j) Authorization of Appropriations.--There is authorized to be
appropriated to carry out this section $400,000,000 for each of fiscal
years 2006 through 2010, to remain available until expended.
``(k) Termination of Authority.--The authority provided by this
section terminates effective December 31, 2010.''.
<all>
Introduced in Senate
Read twice and referred to the Committee on Energy and Natural Resources.
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