to which any such vehicle should be included under the provisions of this part, the manner in which energy requirements of such vehicles may be compared with energy requirements of fuel-consuming vehicles, the extent to which inclusion of such vehicles would stimulate their production and introduction into commerce, and any recommendations for legislative action.

(2) As used in this subsection, the term "electric vehicle" means vehicle powered primarily by an electric motor drawing current from rechargeable batteries, fuel cells, or other portable sources of electrical current.

(c)(1) After an exemption has been granted under section 503(b)(3), the Secretary and the Secretary of Labor shall annually conduct a joint examination of the extent to which the amendment made to section 503(b) by section 4(a)(1) of the Automobile Fuel Efficiency Act of 1980

(A) achieves the purposes of that Act and this title, including whether such amendment has promoted employment in the United States related to motor vehicle manufacturing,

(B) has not caused undue harm to the motor vehicle manufacturing sector in the United States, and

(C) has permitted any manufacturer that has assembled passenger automobiles which are considered domestically manufactured under section 503(b)(2)(E) to thereafter assemble in the United States passenger automobiles of the same model type which have less than 75 percent of their value added in the United States or Canada, together with the reasons for such action.

(2) The Secretary shall include the results of such examination in each annual report that is made to the Congress under subsection (a) more than 180 days after an exemption has been granted under section 503(b)(3) of this subsection, or transmit the results of such examination directly to the Congress before such a report in any case in which circumstances so warrant.

NOTE: Section 13(c) of the Electric and Hybrid Vehicle Research, Development, and Demonstration Act of 1976 (15 U.S.C. 2512(c)), as added by the Chrysler Corporation Loan Guarantee Act of 1979, provides:

"(1) The Secretary of Energy in consultation with the Secretary of Transportation and the Administrator of the Environmental Protection Agency is authorized and directed to conduct a seven-year evaluation program of the inclusion of electric vehicles, as defined in section 512(b)(2) of the Motor Vehicle Information and Cost Savings Act (15 U.S.C. 2012(b)(2)), in the calculation of average fuel economy pursuant to section 503(a) (1) and (2) of the Motor Vehicle Information and Cost Savings Act (15 U.S.C. 2003(a) (1) and (2)) to determine the value and implications of such inclusion as an incentive for the early initiation of industrial engineering development and initial commercialization of electric vehicles in the United States. The evaluation program shall be conducted in parallel with the research and development activities of section 6 and demonstration activities of section 7 (15 U.S.C. 2505 and 2506) to provide all necessary information no later than January 1, 1987, for the private sector and Federal, State and local officials to make required decisions for the full commercialization of electric vehicles in the United States.

"(2) The Administrator of the Environmental Protection Agency, in consultation with the Secretary of Energy and the Secretary of Transportation, shall implement immediately the evaluation program by promulgating, within sixty days of enactment of the Act, regulations to include electric vehicles in average fuel economy calculations under section 503(a) (1) and (2) of the Motor Vehicle Information and Cost Savings Act."

[Paragraph (2) included an amendment which added a new section 503(a)(3) to the Motor Vehicle Information and Cost Savings Act, which is set forth above.]

(3) The Secretary of Energy, in consultation with the Secretary of Transportation and the Administrator of the Environmental Protection Agency, shall include a full discussion of this evaluation program in the annual report required by section 14 (15 U.S.C. 2513, in each year after promulgation of the regulations under paragraph (2). The Secretary of Energy, in consultation with the Secretary of Transportation and the Administrator of the Environmental Protection Agency, shall submit to the Congress on January 1, 1987, a final report on the results of the evaluation program and any recommendations regarding the continued inclusion of electric vehicles in the average fuel economy calculations under the Motor Vehicle Information and Cost Savings Act.".

MANUFACTURING INCENTIVES FOR AUTOMOBILES

SEC. 513. [2013] (a) DEDICATED AUTOMOBILE.-Except as provided in subsection (c) or in section 503(a)(3), if a manufacturer manufactures any model type of dedicated automobile, the fuel economy measured for that model type shall be based on the fuel content of the alternative fuel used to operate such automobile. For purposes of this section, a gallon of a liquid alternative fuel used to operate such automobile shall be considered to contain 15 onehundredths of a gallon of fuel.

(b) DUAL FUELED AUTOMOBILE.-Except as provided in subsection (d) or in section 503(a)(3), if a manufacturer manufactures any model type of dual fueled automobile, the fuel economy measured for that model type shall be measured by the EPA Administrator by dividing 1.0 by the sum of—

(1) 0.5 divided by the fuel economy as measured under section 503(d) while operating such model type on gasoline or diesel fuel; and

(2) 0.5 divided by the fuel economy as measured under subsection (a) of this section while operating such model type on alternative fuel.

(c) GASEOUS FUEL DEDICATED AUTOMOBILE.-If a manufacturer manufactures any model type of gaseous fuel dedicated automobile, the fuel economy measured for that model type shall be based on the fuel_content of the gaseous fuel used to operate such automobile. For purposes of this section, 100 cubic feet of natural gas shall be considered to contain 0.823 gallons equivalent of natural gas, and a gallon equivalent of natural gas shall be considered to have a fuel content of 15 one-hundredths of a gallon of fuel. For purposes of this section, the Secretary shall determine the appropriate gallons equivalent measurement for gaseous fuels other than natural gas, and a gallon equivalent of such gaseous fuel shall be considered to have a fuel content of 15 one-hundredths of a gallon of fuel.

(d) GASEOUS FUEL DUAL FUELED AUTOMOBILE.-If a manufacturer manufactures any model type of gaseous fuel dual fueled automobile, the fuel economy measured for that model type shall be measured by the EPA Administrator by dividing 1.0 by the sum of

(1) 0.5 divided by the fuel economy as measured under section 503(d) while operating such model type on gasoline or diesel fuel; and

(2) 0.5 divided by the fuel economy as measured under subsection (c) of this section while operating such model type on gaseous fuel.

(e) FUEL ECONOMY CALCULATION.-The EPA Administrator shall calculate, subject to the provisions of this section, the manufacturer's average fuel economy under section 503(a) (1) and (2) by including as the denominator of the term for each model type of dedicated automobile or dual fueled automobile, the fuel economy measured pursuant to subsections (a) through (d) of this section. (f) APPLICABILITY.—

(1) Except as otherwise provided in this subsection, subsections (b) and (d) shall apply only to automobiles manufactured in model year 1993 through model year 2004. Subsections (a) and (c) shall apply only to automobiles manufactured after model year 1992.

(2)(A) Not later than September 30, 2000, the Secretary, in consultation with the Secretary of Energy and the EPA Administrator, shall complete and submit to the Committees on Commerce, Science, and Transportation and Governmental Affairs of the Senate, and the Committee on Energy and Commerce of the House of Representatives, a report containing the results of a study of the success of the policy contained in subsections (b) and (d), along with preliminary conclusions as to whether the application of such subsections should be extended for up to four additional model years. Such study and conclusions shall be prepared taking into consideration—

(i) the availability to the public of alternative fueled automobiles and alternative fuels;

(ii) energy conservation and security;

(iii) environmental considerations; and

(iv) other relevant factors.

(B) The Secretary shall

(i) promulgate a rule to extend the applicability of subsections (b) and (d) for 4 or fewer consecutive model years immediately after model year 2004; or

(ii) publish a notice explaining the reasons for not promulgating such rule. Such rule or notice shall be promulgated before January 1, 2002.

Any such promulgated rule shall explain the basis on which any such extension has been granted."

(g) MAXIMUM INCREASE.

(1)(A) For each of the model years 1993 through 2004, for each category of automobiles, other than electric automobiles, the maximum increase in average fuel economy for a manufacturer attributable to dual fueled automobiles shall be 1.2 miles per gallon.

(B) If the application of subsections (b) and (d) is extended under subsection (f)(2), for each category of automobiles, other than electric automobiles, the maximum increase in average fuel economy for a manufacturer for each of the model years 2005 through 2008 attributable to dual fueled automobiles shall be 0.9 miles per gallon.

(C) For purposes of applying subparagraph (A) or (B), the EPA Administrator shall compute the increase in a manufac

turer's average fuel economy attributable to dual fueled automobiles by subtracting from the manufacturer's average fuel economy calculated under subsection (e) the number equal to what the manufacturer's average fuel economy would be if it were calculated by the formula in section 503(a) (1) and (2) by including as the denominator for each model type of dual fueled automobile the fuel economy when such automobiles are operated on gasoline or diesel fuel. If the increase attributable to dual fueled automobiles for any model year described in subparagraph (A) is more than 1.2 miles per gallon, the limitation in subparagraph (A) shall apply, and if the increase attributable to such automobiles for any model year described in subparagraph (B) is more than 0.9 miles per gallon, the limitation in subparagraph (B) shall apply.

(2)(A) Notwithstanding any other provision of this section, if the Secretary reduces the average fuel economy standard applicable to passenger automobiles for any model year below 27.5 miles per gallon, any increase in average fuel economy for passenger automobiles of more than 0.7 miles per gallon to which a manufacturer of dual fueled passenger automobiles would otherwise be entitled in that year under this section shall be reduced by an amount equal to the amount of such reduction in the standard, except that such increase shall not be reduced to less than 0.7 miles per gallon.

(B) In carrying out section 502 (a)(4) and (f), the Secretary shall not consider the fuel economy of dedicated automobiles, and the Secretary shall consider dual fueled automobiles to be operated exclusively on gasoline or diesel fuel. (h) DEFINITIONS.—(1) For purposes of this title

(A) the term "alternative fuel" means methanol, denatured ethanol, and other alcohols; mixtures containing 85 percent or more (or such other percentage, but not less than 70 percent, as determined by the Secretary, by rule, to provide for requirements relating to cold start, safety, or vehicle functions) by volume of methanol, denatured ethanol, and other alcohols with gasoline or other fuels; natural gas; liquefied petroleum gas; hydrogen; coal derived liquid fuels; fuels (other than alcohol) derived from biological materials; electricity (including electricity from solar energy); and any other fuel the Secretary determines, by rule, is substantially not petroleum and would yield substantial energy security benefits and substantial environmental benefits;

(B) the term "alternative fueled automobile" means an automobile that

(i) is a dedicated automobile; or

(ii) is a dual fueled automobile;

(C) the term "dedicated automobile" means an automobile that operates solely on alternative fuels; and

(D) the term "dual fueled automobile"

automobile

means an

(i) which is capable of operating on alternative fuel and on gasoline or diesel fuel;

(ii) which provides equal or superior energy efficiency, as calculated for the applicable model year during fuel

economy testing for the Federal Government, while operating on alternative fuel as it does while operating on gasoline or diesel fuel;

(iii) in the case of an automobile capable of operating on a mixture of an alternative fuel and gasoline or diesel fuel, which, for model years 1993 through 1995, and, if the Administrator of the Environmental Protection Agency determines that an extension of this clause is warranted, for an additional period ending not later than the end of the last model year for which section 513 (b) and (d) applies, provides equal or superior energy efficiency, as calculated for the applicable model year during fuel economy testing for the Federal Government, while operating on a mixture of alternative fuel and gasoline or diesel fuel containing exactly 50 percent gasoline or diesel fuel as it does while operating on gasoline or diesel fuel; and

(iv) which, in the case of passenger automobiles, meets or exceeds the minimum driving range established pursuant to paragraph (2).

(2)(A) For purposes of the definitions in paragraph (1)(D), the Secretary shall, within 18 months after the date of enactment of this section, establish by rule of general applicability for all manufacturers a minimum driving range which must be met by dual fueled automobiles when operating on alternative fuels, if such automobiles are to be considered dual fueled automobiles under this section. Subject to the provisions of this paragraph, the rule may be amended from time to time. Any determination of whether dual fueled automobiles meet the minimum driving range requirement under this paragraph shall be based on the combined EPA city/highway fuel economy as determined for average fuel economy purposes for such automobiles. The rule issued under this subparagraph shall apply only to dual fueled automobiles that are passenger automobiles.

(B)(i) The general rule established under subparagraph (A) shall allow the Secretary to determine that a specific model type or types may have a lower range than that established by the general rule, and shall allow a manufacturer to petition for a specific model type or types to have a lower range than that established by the general rule.

(ii) If, with respect to dual fueled automobiles other than electric automobiles, the Secretary establishes under subparagraph (A) 200 miles as the generally applicable minimum driving range under this paragraph, clause (i) shall not apply to dual fueled automobiles other than electric automobiles.

(C) Under no circumstances shall the general rule established under subparagraph (A) establish a minimum driving range of less than 200 miles for dual fueled automobiles other than electric automobiles, nor shall the Secretary approve under the procedure referred to in subparagraph (B) a minimum driving range of less than 200 miles for dual fueled automobiles other than electric automobiles.

(D) In establishing the general rule under subparagraph (A), and in taking any action under the procedure referred to in subparagraph (B), the Secretary shall take into account the purposes