The Federal Energy Policy Act of 2005 and its Implications for
Energy Efficiency Program Efforts
Steven
Nadel
September 2005
ABSTRACT
In August 2005,
the Energy Policy Act of 2005 was signed into law. This is the first
major piece of federal energy legislation since 1992. The new law
took five years to develop as many controversial provisions were
considered but ultimately not included. The new law includes two
major energy efficiency provisions: (1) manufacturer and consumer
tax incentives for advanced energy-saving technologies and practices;
and (2) minimum energy efficiency standards on 16 products. The
law also includes a host of smaller efficiency provisions.
The tax incentive
provisions provide more than $2 billion for advanced energy-saving
technologies and practices beginning in 2006 and generally extending
for two years.
- Utilities
and other agencies implementing electricity-saving programs should
gear their programs to complement these new tax incentives, including
enhanced programs to promote efficient new homes; new commercial
buildings; appliances; heating, air conditioning, and water heating
equipment; and retrofits to existing homes.
- State agencies
and others interested in distributed generation should consider
policy initiatives and promotions to complement federal incentives
for stationary fuel cells and microturbines.
- States and
others interested in promoting advanced cars and trucks should
use federal hybrid, fuel cell, and advanced diesel vehicle tax
credits to support their efforts.
The standards
provision adopts standards on 16 products and directs the U.S. Department
of Energy (DOE) to conduct rulemakings to revise some of these standards
and to consider standards on several additional products. Program
planners and implementers should consider increasing efforts to
promote adoption of efficient products that will soon be subject
to these DOE rulemakings, including refrigerated beverage vending
machines, external power supplies, dehumidifiers, many types of
commercial refrigeration systems, and ice makers. By helping to
better establish these advanced products in the market, program
operators can increase the chances that DOE will adopt standards
that achieve substantial savings.
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22
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