Energy Efficiency: The Slip Switch to a New Track Toward Compliance with Federal Air Regulations

The U.S. is poised to make a major transition from dirty, outdated, and wasteful energy resources to a cleaner, more efficient energy system. Over the next decade, a suite of federal regulations required under the Clean Air Act will impose compliance obligations and set standards for multiple air pollutants. While energy efficiency has been a significant energy resource for decades, the convergence of new air regulations, a recovering economy, and an aging network of outdated power plants makes energy efficiency an increasingly attractive option.

Recognizing this, the EPA has crafted rules that allow for energy efficiency to be used for compliance or as a complementary compliance tool. EPA has provided guidance for how energy efficiency can be used in the context of air regulations, but past efforts to incorporate energy efficiency as part of an air quality compliance strategy have had limited success. In order to take advantage of this opportunity, stakeholders and policymakers will need to proactively, and strategically address some long-standing barriers to using energy efficiency as a tool to comply with air regulations.

This report provides an overview of the opportunities as well as a brief history of previous efforts to use energy efficiency as a tool to comply with federal air regulations. The report concludes with a discussion of major barriers that have arisen in this context and makes recommendations for how these barriers can be overcome.