Production incentives for cellulosic biofuels

The purpose of this section is to— In this section: The term “cellulosic biofuels” means any fuel that is produced from cellulosic feedstocks. The term “eligible entity” means a producer of fuel from cellulosic biofuels the production facility of which— The Secretary, in consultation with the Secretary of Agriculture, the Secretary of Defense, and the Administrator of the Environmental Protection Agency, shall establish an incentive program for the production of cellulosic biofuels. Under the program, the Secretary shall award production incentives on a per gallon basis of cellulosic biofuels from eligible entities, through— The first reverse auction shall be held on the earlier of— On initiation of the first reverse auction, and each year thereafter until the earlier of the first year of annual production in the United States of 1,000,000,000 gallons of cellulosic biofuels, as determined by the Secretary, or 10 years after August 8, 2005, the Secretary shall conduct a reverse auction at which— eligible entities shall submit— An eligible entity selected by the Secretary through a reverse auction shall receive the amount of performance incentive requested in the auction for each gallon produced and sold by the entity during the first 6 years of operation. As a condition of the receipt of an award under this section, an eligible entity shall enter into an agreement with the Secretary under which the eligible entity agrees to begin production of cellulosic biofuels not later than 3 years after the date of the reverse auction in which the eligible entity participates. Awards under this section shall be limited to— In selecting a project under the program, the Secretary shall give priority to projects that— There is authorized to be appropriated to carry out this section $250,000,000.