PROPOSED QUALIFIED ENERGY DEVELOPMENT PROGRAM Amendment to Section 1603 of American Recovery and Reinvestment Act of 2009

SEC. 1603. GRANTS FOR SPECIFIED ENERGY PROPERTY IN LIEU OF TAX CREDITS. (a) In General - Upon grant application, the Secretary of the Treasury shall, subject to the limitations and requirements of this section, provide a grant to each person who places in service specified energy property to reimburse such person for a portion of the expense of such property as provided in subsection (c). No grant shall be made under this section with respect to any property unless such property-(1) is placed in service during 2009, 2010, 2011, 2012, 2013, 2014, or 2015 (2) is placed in service after 2015 and before the credit termination date with respect to such property, but only if the construction of such property began during 2014 or 2015. (b) Allocation Limitation (1) CONSTRUCTION BEFORE 2011. There shall be no limitation for the amount of grant under this section for specified energy property if the construction of such property began during 2009 or 2010. (2) CONSTRUCTION AFTER 2010. (A) There shall be no limitation for the amount of grant under this section for specified energy property if: (i) the construction of such property began after 2010; and (ii) such property is placed in service by a small energy development entity in accordance with this section. (B) There shall be a limitation for the amount of grant under this section for specified energy property placed in service by large energy development entities if the construction of such property began after 2010. Such large energy development entity limitation for each calendar year is -(i) $10,000,000,000 for 2011, (ii) $10,000,000,000 for 2012, and

(iii) $5,000,000,000 for 2013. (C) The grant limitation under paragraph (2)(B) for large energy development entities shall be allocated by the Secretary of Energy among large energy development entities selected by the Secretary of Energy. In making allocations under the preceding sentence, the Secretary of Energy shall give priority to any large energy development entity: (i) with a record of having successfully placed in service and operated specified energy property in the United States; and (ii) which intends to cause persons to: (I) make new investments in specified energy property (as defined in this section), qualifying advanced energy projects (as defined in section 48C(c)(1)) and any other trade or businesses located in the United States; and (II) retain and create jobs developing, researching, manufacturing, installing, operating, maintaining and servicing specified energy property (as defined in this section) and qualifying advanced energy projects (as defined in section 48C(c)(1)) located in the United States. (c) Individual Grant Amount (1) IN GENERAL - The amount of the grant payment to each person under subsection (a) with respect to any specified energy property shall be the applicable percentage of the basis of such property. (2) APPLICABLE PERCENTAGE - For purposes of paragraph (1), the term “applicable percentage” means-(A) 30 percent in the case of any property described in paragraphs (1) through (4) of subsection (f), and (B) 10 percent in the case of any other property. (3) DOLLAR LIMITATIONS (A) LARGE ENERGY DEVELOPMENT ENTITY LIMITATION. If construction of the specified property began after 2010 by a large energy developer, the maximum amount of grants made to any large energy developer under this section shall not exceed the portion of the grant limitation amount allocated under subsection (b)(2)(B) to such person.

(B) OTHER LIMITATIONS. In the case of property described in paragraph (2), (6), or (7) of subsection (f), in addition to the allocation limitations set forth in (A) above, the amount of any grant payment under this section with respect to such property shall not exceed the limitation described in section 48(c)(1)(B), 48(c)(2)(B), or 48(c)(3)(B) of the Internal Revenue Code of 1986, respectively, with respect to such property. (d) Time for Payment of Grant - The Secretary of the Treasury shall make payment of any grant under subsection (a) during the 60-day period beginning on the later of-(1) the date of the application for such grant, or (2) the date the specified energy property for which the grant is being made is placed in service. (e) Energy Development Entity - For purposes of this section: (1) the term ‘large energy development entity’ means any person applying under this section for $20,000,000 or more in grant under this section in any one year; and (2) the term ‘small energy development entity’ means any person applying under this section for less $20,000,000 in grant in any one calendar year. (f) Specified Energy Property - For purposes of this section, the term ‘specified energy property'’ means any of the following: (1) QUALIFIED FACILITIES - Any qualified property (as defined in section 48(a)(5)(D) of the Internal Revenue Code of 1986) which is part of a qualified facility (within the meaning of section 45 of such Code) described in paragraph (1), (2), (3), (4), (6), (7), (9), or (11) of section 45(d) of such Code. (2) QUALIFIED FUEL CELL PROPERTY - Any qualified fuel cell property (as defined in section 48(c)(1) of such Code). (3) SOLAR PROPERTY - Any property described in clause (i) or (ii) of section 48(a)(3)(A) of such Code. (4) QUALIFIED SMALL WIND ENERGY PROPERTY - Any qualified small wind energy property (as defined in section 48(c)(4) of such Code). (5) GEOTHERMAL PROPERTY - Any property described in clause (iii) of section 48(a)(3)(A) of such Code. (6) QUALIFIED MICROTURBINE PROPERTY - Any qualified microturbine property (as defined in section 48(c)(2) of such Code).

(7) COMBINED HEAT AND POWER SYSTEM PROPERTY - Any combined heat and power system property (as defined in section 48(c)(3) of such Code). (8) GEOTHERMAL HEAT PUMP PROPERTY - Any property described in clause (vii) of section 48(a)(3)(A) of such Code. Such term shall not include any property unless depreciation (or amortization in lieu of depreciation) is allowable with respect to such property. (h) Credit Termination Date- For purposes of this section, the term `credit termination date' means-(1) in the case of any specified energy property which is part of a facility described in paragraph (1) of section 45(d) of the Internal Revenue Code of 1986, January 1, 2018, (2) in the case of any specified energy property which is part of a facility described in paragraph (2), (3), (4), (6), (7), (9), or (11) of section 45(d) of such Code, January 1, 2014, and (3) in the case of any specified energy property described in section 48 of such Code, January 1, 2022. In the case of any property which is described in paragraph (3) and also in another paragraph of this subsection, paragraph (3) shall apply with respect to such property. (i) Application of Certain Rules - In making grants under this section, the Secretary of the Treasury shall apply rules similar to the rules of section 50 of the Internal Revenue Code of 1986. In applying such rules, if the property is disposed of, or otherwise ceases to be specified energy property, the Secretary of the Treasury shall provide for the recapture of the appropriate percentage of the grant amount in such manner as the Secretary of the Treasury determines appropriate. (j) Exception for Certain Non-Taxpayers - The Secretary of the Treasury shall not make any grant under this section to-(1) any Federal, State, or local government (or any political subdivision, agency, or instrumentality thereof), (2) any organization described in section 501(c) of the Internal Revenue Code of 1986 and exempt from tax under section 501(a) of such Code, (3) any entity referred to in paragraph (4) of section 54(j) of such Code, or (4) any partnership or other pass-thru entity any partner (or other holder of an equity or profits interest) of which is described in paragraph (1), (2) or (3).

(k) Definitions- Terms used in this section which are also used in section 45 or 48 of the Internal Revenue Code of 1986 shall have the same meaning for purposes of this section as when used in such section 45 or 48. Any reference in this section to the Secretary of the Treasury shall be treated as including the Secretary's delegate. (l) Appropriations - There is hereby appropriated to the Secretary of the Treasury such sums as may be necessary to carry out this section. (m) Termination - The Secretary of the Treasury shall not make any grant to any person under this section unless the grant application of such person for such grant is received before October 1, 2015. (n) Large Energy Development Program - Not later than 90 days after the date of enactment of this section, the Secretary of the Treasury, in consultation with the Secretary of Energy, shall establish a large energy development program for allocations and grants under this section to large energy development entities beginning construction of specified energy property after 2010. KD_2823249_3.DOCX