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Current Energy Legislation
Potential Energy LegislationMajor Energy Efficiency Issues Likely to Come Before Congress in 2009Congress is considering three major pieces of energy-related legislation in 2009 – an economic stimulus bill, an energy bill, and climate change legislation. The stimulus bill was enacted in February – click here for more information. The schedule for the other two are less clear, but our best guess is an energy bill in the summer of 2009 and final climate legislation in early 2010. It is also possible that energy and climate legislation will be combined. Click here for more information on climate legislation. Potential provisions in energy legislation are discussed below. Renewable Energy and Energy Efficiency Resource Standards. The House passed a provision in August 2007 to establish a requirement that electric utilities meet 15% of their energy requirements from renewable energy sources and energy efficiency measures. Under this provision, up to 4% of energy needs could come from efficiency, leaving at least 11% from renewables. This provision was supported by a majority of Senators, but not the 60 votes needed to break a filibuster. Congressional leadership has said they want to move a provision along these lines in 2009. With the new Administration and Congress, the targets could increase. ACEEE, for example, is working on a separate Energy Efficiency Resource Standard (EERS) that saves 15% of electricity and 10% of natural gas by 2020 and is insisting that if renewable and energy efficiency standards are combined, energy efficiency needs at least 10% by 2020.
Energy Efficiency Tax Incentives. The Economic Stabilization Act, passed in October of 2008, renewed many of the consumer tax incentives for 2009 and extended several others, including the Commercial Building Tax Deduction, through 2013. The economic stimulus bill contains additional extensions and enhancements.
Still, tax credits for efficient new homes and for purchase of efficient heavy vehicles such as hybrids all expire at the end of 2009 and are likely to come up for renewal during the year. Refinements to the current commercial buildings tax deduction may come up as well. Building Codes. The 2007 House bill contained a provision calling for DOE and states to update energy codes for new buildings. This provision directed DOE to support efforts by model code organizations to update building codes to reduce energy use of new buildings by at least 30% by 2010, and 50% by 2020. The 30% target is based on a goal set by the American Society of Heating Refrigerating and Air-Conditioning Engineers (ASHRAE) for the pending 2010 update of their model commercial building code. The 50% goal is a qualification level for energy efficiency tax credits adopted by Congress in 2005. As new codes are finalized, states were directed to either adopt these model codes or their own state-specific equivalents. Funding and technical assistance to states was authorized. In order to meet long-term energy goals, it is important that new buildings be as energy-efficient as is economically justified, since it will be much more expensive to retrofit these buildings after they are completed. This provision was dropped during conference negotiations due to opposition from some Senators. It is likely to come up again in 2009. Appliance Standards. Federal minimum efficiency standards have been set on more than 40 products. New legislation may add a few additional products and may clarify aspects of the process by which DOE periodically revises these standards. For example, items likely to come up include clarifying DOE’s authority to set multiple performance standards for a product (this was in the House and Senate 2007 energy bills, but dropped from the final bill), directing DOE to consider the impact of carbon emissions and the impact of the energy savings on energy prices when setting standards, strengthening the “rebuttable presumption test” for setting standards when efficiency savings are highly cost-effective, and setting standards on “BR” reflector lamps, a major loophole in current DOE standards. Energy-Saving Home Retrofits. ACEEE is working with other organizations to establish rebates for homes that undertake comprehensive energy efficiency retrofits, such as under EPA’s Home Performance with Energy Star program. The rebate would be performance based, rewarding higher levels of energy efficiency improvement with higher rebates under a good (10% savings), better (20% savings) and best (30% savings or more) model. The program would be administered by states and would include support for the training of contractors and home energy raters who would help implement the program. Initial incentives might come out of stimulus or regular budget funds, with long-term funding incorporated into climate legislation.
Building Labeling/Disclosure. Draft climate change legislation prepared by Representatives Dingell and Boucher included a provision to expand the Energy Star building labeling program to include homes and additional types of commercial buildings. These labels let building owners, prospective purchasers, and prospective tenants know how the energy performance of a building compared to other similar buildings in the area. The intent is to motive building owners to upgrade their buildings, and to help prospective purchasers and tenants select efficient buildings. Programs along these lines are now being started in Europe and in several U.S. states.
Multifamily and Manufactured Housing. ACEEE is also working to develop a new program at DOE that would offer competitive grants for innovative projects to improve the efficiency of multifamily and manufactured housing. Saving energy is more difficult in multi-family and manufactured housing and such housing is disproportionately used by low- and moderate-income families. There are some successful local programs, but the number of programs being operated are few and far between. For example, creative programs could be developed to encourage retirement of old manufactured homes, to invest in efficiency upgrades for new or existing publicly assisted housing, or to institute multifamily building heating system retrofits. Given the limited experience to date, we recommend that now is the time to encourage of variety of innovative approaches, to evaluate these approaches, and based on these evaluations to then develop broader programs. For further details, see the fact sheet. Industrial Assessment Centers. Workforce has emerged as a critical issue for implementation of energy efficiency in manufacturing, as well as expansion of production and productivity improvements more broadly. The Industrial Assessment Center (IAC) program is the only manufacturing energy efficiency training program currently funded by the Federal Government. ACEEE has begun working to expand and enhance this program to meet this growing need. For more information on ACEEE's IAC recommendations, click here. Building Training and Assessment Centers: A new program has been proposed by ACEEE and others to help train building engineers and technicians, similar to the Industrial Assessment Center discussed above. Today’s commercial buildings have increasingly sophisticated controls and need trained engineers and technicians to help design and operate them optimally. There is a shortage of such skilled staff today. A BTAC program would help address this need, building on the successful IAC model.
Commercial Building Efficiency Retrofits: The Real Estate Roundtable and NRDC has developed a proposal to establish a program that would encourage the near term launch of large scale, deep retrofitting of private and publicly owned commercial buildings or portfolios of buildings. The program would provide an incentive to building owners for efficiency improvements based on demonstrated energy savings of no less than 20% with incentives calibrated to encourage 30% savings or greater. The Energy Star Building benchmarking program would be used to document and verify performance and the incentive would take the form of a rebate per square foot. A loan guarantee, proportional to the targeted energy savings level, would be established to enable upfront investment in energy efficiency projects. Partial payment of the incentive would be granted upon completion of the efficiency project and with the remainder of the incentive conditioned on verification of actual performance over a three year period. This would be another program for which initial incentives might come out of stimulus or regular budget funds, with long-term funding incorporated into climate legislation. Transportation Alternatives. The “Transportation and Housing Choices for Gas Price Relief Act” (H.R. 6495) introduced over the summer of 2008 by Reps. Blumenauer, Shays and Tauscher will: reduce commuting costs and increase commuter choices, help transit agencies cope with rising fuel prices and improve service to deal with increased demand, assist communities in providing transportation options for their residents, increase the availability of affordable housing near public transportation, and ensure that the Federal government leads by example on these issues. ACEEE is supporting inclusion of these provisions in the next energy or transportation bill. Last Updated 06/23/2009 For more information contact:
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