Federal Laws and Legislation

The United States Congress has been using its authority to address energy policy challenges for more than a century. The first federal law on energy was the Federal Power Act of 1920, and energy concerns continue to be a major topic of discussion in the House of Representatives and the Senate today.

There are three major types of legislation that Congress is empowered to pass: authorizing legislation, appropriations legislation, and tax legislation. Each of these plays a role in how the federal government addresses energy efficiency policy issues.

Authorizing legislation is used by Congress to establish or modify a federal program or to set standards. Key laws with efficiency provisions include the National Appliance Energy Conservation Act of 1987, which governs appliance efficiency standards; the Energy Policy Act of 1992, which authorized many programs; and the Energy Independence and Security Act of 2007, which updated fuel economy standards and created other programs. Except in a few cases, notably the periodic transportation bill and farm bill, these bills do not actually provide agencies and programs with money to spend.

Appropriations legislation is the tool that Congress uses to provide funding to federal agencies and programs, usually for one fiscal year. Ideally, there are twelve bills from the House and Senate Appropriations Committees each year (the Energy and Water bill funds Department of Energy programs and the Interior bill funds the Environmental Protection Agency). When Congress is not able to pass a regular appropriations bill, it can pass what’s known as a continuing resolution to fund agencies for a time at the same levels as the previous fiscal year, or an omnibus bill that includes multiple appropriations bills. Much of the guidance on appropriations is not in the bill text but in accompanying committee report language.

Tax legislation raises revenue for the federal government. This is an important element of federal energy efficiency policy because tax incentives (credits or deductions) are used to encourage use of important efficiency technologies. Tax incentives in the Energy Policy Act of 2005 for home energy improvements, new efficient homes, efficient commercial buildings, and efficient vehicles have been extended and modified several times. A tax on greenhouse gas emissions has also been proposed as a way to combat climate change. 

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