House Energy Bill Takes Small Steps for Energy Efficiency

WASHINGTON, D.C. — Testimony before the House Energy and Commerce Committee today by the American Council for an Energy-Efficient Economy (ACEEE) said that the energy bill recently introduced in the House contains important energy efficiency provisions, but leaves out much larger measures that are crucial to an effective energy policy.

"As we stand poised for war in Iraq, it is astonishing that an American energy bill would do so little to save oil," said ACEEE Executive Director Steven Nadel. "We applaud the Energy and Commerce Committee for retaining the appliance efficiency standards and other energy efficiency features from last year's conference, but the larger issues of vehicle fuel economy and efficiency in the electricity sector are not seriously addressed."

ACEEE supports the energy efficiency provisions in the bill, including:

• Title I on Energy Conservation — especially the sections on energy conservation standards for additional consumer and commercial products and on federal leadership in energy conservation;
• Title VI on DOE Programs and the sections of Title V dealing with hydrogen vehicles and fuel; and
• Title X on Automobile Efficiency, primarily because it improves on the 2001 legislation by not extending the dual-fuel credit for cars (thereby saving on the order of 55 million barrels of oil annually).

These provisions would produce modest overall impacts on U.S. energy use. ACEEE estimates that the provisions will reduce U.S. energy use by about 2% in 2020, and will prevent the need for 130 300-Megawatt power plants. However, ACEEE's and others' analyses have shown that more aggressive efficiency policies could achieve savings on the order of 25% reduction in U.S. energy use in 2020.

Therefore, much more needs to be done to improve U.S. energy efficiency. Nadel's testimony recommended:

• Clarifying DOE's authority for residential furnace efficiency standards, and adding other new efficiency standards based on negotiations with industry;
• Setting a fuel-savings goal of one million barrels per day of oil savings by 2010 for future passenger vehicle fuel-economy rules (an increase of about 5 miles per gallon from current levels, displacing more oil than we import from Iraq);
• Encouraging combined heat and power and other distributed generation systems by adding provisions to Title VII that would provide an orderly transition from the current PURPA structure to one in which distributed generators participate in a fair marketplace that values their benefits and prices services in a truly competitive manner; and
• Including an Energy Efficiency Performance Standard for electricity suppliers, modeled after a program now operating in Texas.

These additional provisions would multiply energy savings under the bill more than five times; at this level, the bill would realize almost half the potential savings defined by leading researchers. Failure to take these steps now will increase our oil dependency and energy prices, slow the economic recovery, worsen our air quality, and accelerate global warming. Timid energy efficiency policies will only delay the inevitable reckoning Congress will have to make with our growing energy problems.

The complete testimony can be downloaded from http://aceee.org/tstimony/0303compnep.pdf.