Sec. 204. Clean energy coal bonds
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Subpart I of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section: For purposes of this subchapter— The term clean energy coal bond means any bond issued as part of an issue if— the bond is issued by a qualified issuer pursuant to an allocation by the Secretary to such issuer of a portion of the national clean energy coal bond limitation under subsection (b)(2), so much of the available project proceeds from the sale of such issue as is equal to 95 percent of the excess of— the total available project proceeds from the sale of such issue, over the amounts in a reasonably required reserve (within the meaning of section 150(a)(3)) with respect to such issue, are to be used for capital expenditures incurred by qualified borrowers for 1 or more qualified projects, the qualified issuer makes an irrevocable election to have this section apply, the qualified issuer designates such bond for purposes of this section and the bond is in registered form, and in lieu of the requirements of section 54A(d)(2), the issue meets the requirements of subsection (c).
The term qualified project means a qualified clean coal project (as defined in subsection (h)(1)) placed in service by a qualified borrower. For purposes of paragraph (1)(B), a qualified project may be refinanced with proceeds of a clean energy coal bond only if the indebtedness being refinanced (including any obligation directly or indirectly refinanced by such indebtedness) was originally incurred by a qualified borrower after the date of the enactment of this section. For purposes of paragraph (1)(B), a clean energy coal bond may be issued to reimburse a qualified borrower for amounts paid after the date of the enactment of this section with respect to a qualified project, but only if— prior to the payment of the original expenditure, the qualified borrower declared its intent to reimburse such expenditure with the proceeds of a clean energy coal bond, not later than 60 days after payment of the original expenditure, the qualified issuer adopts an official intent to reimburse the original expenditure with such proceeds, and reimbursement is not made later than 18 months after the date the original expenditure is paid or the date the project is placed in service or abandoned, but in no event more than 3 years after the original expenditure is paid.
For purposes of paragraph (1)(B), the proceeds of an issue shall not be treated as used for a qualified project to the extent that a qualified borrower takes any action within its control which causes such proceeds not to be used for a qualified project. The Secretary shall prescribe regulations specifying remedial actions that may be taken (including conditions to taking such remedial actions) to prevent an action described in the preceding sentence from causing a bond to fail to be a clean energy coal bond.
There is a national clean energy coal bond limitation of $5,000,000,000. The Secretary shall allocate the amount described in paragraph
(1)among qualified projects in such manner as the Secretary determines appropriate. An issue shall be treated as meeting the requirements of this subsection if, as of the date of issuance, the qualified issuer reasonably expects— 100 percent or more of the available project proceeds from the sale of the issue are to be spent for 1 or more qualified projects within the 5-year period beginning on the date of issuance of the clean energy bond, a binding commitment with a third party to spend at least 10 percent of such available project proceeds from the sale of the issue will be incurred within the 6-month period beginning on the date of issuance of the clean energy bond or, in the case of a clean energy bond the available project proceeds of which are to be loaned to 2 or more qualified borrowers, such binding commitment will be incurred within the 6-month period beginning on the date of the loan of such proceeds to a qualified borrower, and such projects will be completed with due diligence and the available project proceeds from the sale of the issue will be spent with due diligence. Upon submission of a request prior to the expiration of the period described in paragraph (1)(A), the Secretary may extend such period if the qualified issuer establishes that the failure to satisfy the 5-year requirement is due to reasonable cause and the related projects will continue to proceed with due diligence. To the extent that less than 100 percent of the available project proceeds of such issue are expended by the close of the 5-year period beginning on the date of issuance (or if an extension has been obtained under paragraph (2), by the close of the extended period), the qualified issuer shall redeem all of the nonqualified bonds within 90 days after the end of such period. For purposes of this paragraph, the amount of the nonqualified bonds required to be redeemed shall be determined in the same manner as under section 142. The annual credit determined under section 54A(b) with respect to any clean coal energy bond shall be 70 percent of the amount so determined without regard to this subsection. For purposes of this section— The term cooperative electric company means a mutual or cooperative electric company described in section 501(c)(12) or section 1381(a)(2)(C), or a not-for-profit electric utility which has received a loan or loan guarantee under the Rural Electrification Act. The term clean energy bond lender means a lender which is a cooperative which is owned by, or has outstanding loans to, 100 or more cooperative electric companies and is in existence on February 1, 2002, and shall include any affiliated entity which is controlled by such lender. The term public power entity means a State utility with a service obligation, as such terms are defined in section 217 of the Federal Power Act (as in effect on the date of enactment of this paragraph). The term qualified issuer means— a clean energy bond lender, a cooperative electric company, or a public power entity. The term qualified borrower means— a mutual or cooperative electric company described in section 501(c)(12) or 1381(a)(2)(C), or a public power entity. No portion of a pooled financing bond may be allocable to any loan unless the borrower has entered into a written loan commitment for such portion prior to the issue date of such issue. In the case of any payment due under section 6431(b) by reason of section 6431(f)(3)(A)(v) which is subject to reduction in accordance with a sequestration report prepared by the Director of the Office of Management and Budget pursuant to the Balanced Budget and Emergency Deficit Control Act of 1985 or the Statutory Pay-As-You-Go Act of 2010— the amount of such payment shall be increased to an amount equal to the product of— the amount of such payment as determined before the reduction in accordance with the sequestration report, and a fraction the numerator of which is 1 and the denominator of which is the excess of— 100, over the percentage by which such payment is reduced (without regard to this subsection) in accordance with the sequestration report, and such increase shall be treated as not subject to the sequestration report. For purposes of this section— The term qualified clean coal project means— an atmospheric pollution control facility (within the meaning of section 169(d)(1)), a qualifying clean coal project (within the meaning of section 48E(c)(1)), a qualified facility (within the meaning of section 45Q(c)), or an integrated gasification combined cycle unit, supercritical coal-fired power plant, or ultrasupercritical coal-fired power plant, with an energy efficiency percentage (as defined in section 48(c)(3)(C)(i)) that is not less than 5 percentage points greater than the average energy efficiency percentage for coal electrical production facilities in the United States and corrected for the impact of carbon capture (as determined by the Secretary of Energy). The term integrated gasification combined cycle unit means an electric generation unit that produces electricity by converting coal to synthesis gas that is used to fuel a combined-cycle plant that produces electricity from both a combustion turbine (including a combustion turbine/fuel cell hybrid) and a steam turbine. The term pooled financing bond shall have the meaning given such term by section 149(f)(6)(A). The term supercritical coal-fired power plant means a coal-fired power plant operating at pressures such that water boils first and then is converted to superheated steam. The term ultrasupercritical coal-fired power plant means a power plant described in subparagraph
(C)operating above supercritical pressure and at steam temperatures above 1,100 degrees Fahrenheit. . Paragraph
(5)of section 54A(d) of such Code is amended by adding at the end the following new subparagraph: The requirements of this paragraph shall not apply to a clean energy coal bond under section 54G. . Paragraph
(1)of section 54A(d) of the Internal Revenue Code of 1986 is amended by striking or at the end of subparagraph (D), by inserting or at the end of subparagraph (E), and by inserting after subparagraph
(E)the following new subparagraph: a clean energy coal bond, . The table of sections for subpart I of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new item: Sec. 54G. Clean energy coal bonds. . Section 6431(f)(3)(A) of the Internal Revenue Code of 1986 is amended by striking or at the end of clause (iii), by striking and at the end of clause
(iv)and inserting or , and by adding at the end the following new clause: a clean energy coal bond (as defined in section 54G), and . Paragraph
(2)of section 6431(f) of such Code is amended— by striking clause
(i)or
(ii)and inserting clause (i), (ii), or
(v); and by striking the heading and inserting . Special rule for certain bonds The amendments made by this section shall apply to bonds issued after the date of the enactment of this Act.