Sec. 5021. Clean fuel production credit
1,936 words·~9 min read·
/bill/114/s/2089/pcs/section-5021A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Subpart D of part IV of subchapter A of chapter 1, as amended by section _01, is amended by adding at the end the following new section: For purposes of section 38, the clean fuel production credit for any taxable year is an amount equal to the product of— $1.00 per energy equivalent of a gallon of gasoline with respect to any transportation fuel which is— produced by the taxpayer at a qualified facility, and sold or used by the taxpayer in a manner described in paragraph (2), and the emissions factor for such fuel (as determined under subsection (b)(2)).
For purposes of paragraph (1)(A)(ii), the transportation fuel is sold or used in a manner described in this paragraph if such fuel is— sold by the taxpayer to an unrelated person— for use by such person in the production of a fuel mixture that will be used as a transportation fuel, for use by such person as a transportation fuel in a trade or business, or who sells such fuel at retail to another person and places such fuel in the fuel tank of such other person, or used or sold by the taxpayer for any purpose described in subparagraph (A).
If any amount determined under paragraph
(1)is not a multiple of 0.1 cent, such amount shall be rounded to the nearest multiple of 0.1 cent. The emissions factor of a transportation fuel shall be an amount equal to the quotient of— an amount (not less than zero) equal to — 77.23, minus the emissions rate for such fuel, divided by 77.23. The Secretary, in consultation with the Administrator of the Environmental Protection Agency, shall establish the safe harbor emissions rate for similar types and categories of transportation fuels based on the amount of lifecycle greenhouse gas emissions (as described in section 211(o)(1)(H) of the Clean Air Act ( 42 U.S.C. 7545(o)(1)(H) ), as in effect on the date of the enactment of this section) for such fuels, expressed as kilograms of CO 2 e per mmBTU, which a taxpayer may elect to use for purposes of this section. The Secretary may round the safe harbor emissions rates under subparagraph
(B)to the nearest multiple of 7.723 kilograms of CO 2 e per mmBTU, except that, in the case of an emissions rate that is less than 3.862 kilograms of CO 2 e per mmBTU, the Secretary may round such rate to zero. In the case of any transportation fuel for which a safe harbor emissions rate has not been established by the Secretary, a taxpayer producing such fuel may file a petition with the Secretary for determination of the safe harbor emissions rate with respect to such fuel. In the case of a transportation fuel for which a petition described in clause
(i)has been filed, the Secretary, in consultation with the Administrator of the Environmental Protection Agency, shall— not later than 12 months after the date on which the petition was filed, provide a provisional safe harbor emissions rate for such fuel which a taxpayer may use for purposes of this section, and not later than 24 months after the date on which the petition was filed, establish the safe harbor emissions rate for such fuel. If any amount determined under subparagraph
(A)is not a multiple of 0.1, such amount shall be rounded to the nearest multiple of 0.1. The Secretary, in consultation with the Administrator of the Environmental Protection Agency, shall publish a table that sets forth the safe harbor emissions rate (as established pursuant to paragraph (1)) for similar types and categories of transportation fuels. In the case of calendar years beginning after 2018, the $1.00 amount in subsection (a)(1)(A) shall be adjusted by multiplying such amount by the inflation adjustment factor for the calendar year in which the sale or use of the transportation fuel occurs. If any amount as increased under the preceding sentence is not a multiple of 1 cent, such amount shall be rounded to the nearest multiple of 1 cent. For purposes of paragraph (1), the inflation adjustment factor shall be the inflation adjustment factor determined and published by the Secretary pursuant to section 45S(c), determined by substituting calendar year 2017 for calendar year 1992 in paragraph
(3)thereof. Subject to paragraph (3), if the Secretary, in consultation with the Secretary of Energy and the Administrator of the Environmental Protection Agency, determines that the greenhouse gas emissions from transportation fuel produced and sold at retail annually in the United States are equal to or less than 72 percent of the greenhouse gas emissions from transportation fuel produced and sold at retail in the United States during calendar year 2005, the amount of the clean fuel production credit under this section for any qualified facility placed in service during a calendar year described in paragraph
(2)shall be equal to the product of— the amount of the credit determined under subsection
(a)without regard to this subsection, multiplied by the phase-out percentage under paragraph (2). The phase-out percentage under this paragraph is equal to— for a facility placed in service during the first calendar year following the calendar year in which the determination described in paragraph
(1)is made, 75 percent, for a facility placed in service during the second calendar year following such determination year, 50 percent, for a facility placed in service during the third calendar year following such determination year, 25 percent, and for a facility placed in service during any calendar year subsequent to the year described in subparagraph (C), 0 percent. If the Secretary, in consultation with the Secretary of Energy and the Administrator of the Environmental Protection Agency, determines that the greenhouse gas emissions from transportation fuel produced and sold at retail annually in the United States are, for each year before calendar year 2026, greater than the percentage specified in paragraph (1), then the determination described in such paragraph shall be deemed to have been made for calendar year 2025. In this section: mm BTU The term mmBTU means 1,000,000 British thermal units. 2 e The term CO means, with respect to any greenhouse gas, the equivalent carbon dioxide. 2 e The term greenhouse gas has the same meaning given that term under section 211(o)(1)(G) of the Clean Air Act ( 42 U.S.C. 7545(o)(1)(G) ), as in effect on the date of the enactment of this section. Subject to subparagraphs
(B)and (C), the term qualified facility means a facility used for the production of transportation fuels. For purposes of this section, a facility shall only qualify as a qualified facility— in the case of a facility that is originally placed in service after December 31, 2017, for the 10-year period beginning on the date such facility is placed in service, or in the case of a facility that is originally placed in service before January 1, 2018, for the 10-year period beginning on January 1, 2018. The term transportation fuel means a fuel which is suitable for use as a fuel in a highway vehicle or aircraft. Not later than January 1, 2017, the Secretary, in consultation with the Administrator of the Environmental Protection Agency, shall issue final guidance regarding implementation of this section, including calculation of emissions factors for transportation fuel, the table described in subsection (b)(2), and the determination of clean fuel production credits under this section. No clean fuel production credit shall be determined under subsection
(a)with respect to any transportation fuel unless— the taxpayer is registered as a producer of clean fuel under section 4101 at the time of production, and such fuel is produced in the United States. For purposes of this paragraph, the term United States includes any possession of the United States. In the case of a facility in which more than 1 person has an ownership interest, except to the extent provided in regulations prescribed by the Secretary, production from the facility shall be allocated among such persons in proportion to their respective ownership interests in the gross sales from such facility. Persons shall be treated as related to each other if such persons would be treated as a single employer under the regulations prescribed under section 52(b). In the case of a corporation which is a member of an affiliated group of corporations filing a consolidated return, such corporation shall be treated as selling fuel to an unrelated person if such fuel is sold to such a person by another member of such group. Under regulations prescribed by the Secretary, rules similar to the rules of subsection
(d)of section 52 shall apply. In the case of an eligible cooperative organization, any portion of the credit determined under subsection
(a)for the taxable year may, at the election of the organization, be apportioned among patrons of the organization on the basis of the amount of business done by the patrons during the taxable year. An election under clause
(i)for any taxable year shall be made on a timely filed return for such year. Such election, once made, shall be irrevocable for such taxable year. Such election shall not take effect unless the organization designates the apportionment as such in a written notice mailed to its patrons during the payment period described in section 1382(d). The amount of the credit apportioned to any patrons under subparagraph (A)— shall not be included in the amount determined under subsection
(a)with respect to the organization for the taxable year, and shall be included in the amount determined under subsection
(a)for the first taxable year of each patron ending on or after the last day of the payment period (as defined in section 1382(d)) for the taxable year of the organization or, if earlier, for the taxable year of each patron ending on or after the date on which the patron receives notice from the cooperative of the apportionment. If the amount of the credit of a cooperative organization determined under subsection
(a)for a taxable year is less than the amount of such credit shown on the return of the cooperative organization for such year, an amount equal to the excess of— such reduction, over the amount not apportioned to such patrons under subparagraph
(A)for the taxable year, shall be treated as an increase in tax imposed by this chapter on the organization. Such increase shall not be treated as tax imposed by this chapter for purposes of determining the amount of any credit under this chapter. For purposes of this section the term eligible cooperative means a cooperative organization described in section 1381(a) which is owned more than 50 percent by agricultural producers or by entities owned by agricultural producers. For this purpose an entity owned by an agricultural producer is one that is more than 50 percent owned by agricultural producers. . Section 38(b), as amended by section _01, is amended— in paragraph (36), by striking plus at the end, in paragraph (37), by striking the period at the end and inserting , plus , and by adding at the end the following new paragraph: the clean fuel production credit determined under section 45T(a). . The table of sections for subpart D of part IV of subchapter A of chapter 1, as amended by section _01, is amended by adding at the end the following new item: Sec. 45T. Clean fuel production credit. . Section 4101(a)(1) is amended by inserting every person producing a fuel eligible for the clean fuel production credit (pursuant to section 45T), after section 6426(b)(4)(A)), . The amendments made by this section shall apply to transportation fuel produced after December 31, 2017.
Connectionstraces to 1
Traces to 1 document
U.S. Code
Citation graph
cites case law
Sec. 5021
Clean fuel production credit
Cites 1Cited by 0 across 0 sources