ACEEE PRESS BRIEF
HOUSE ENERGY BILL DOES LITTLE TO PROMOTE ENERGY
EFFICIENCY;
SENATE SHOULD ADDRESS GAPS
Statement of Steven Nadel, Executive
Director
American Council for an Energy-Efficient Economy,
Washington, DC
August 7, 2001
Contact: Steve Nadel at (202)
429-8873
WASHINGTON, D.C. -- Despite extensive rhetoric from the
President, Vice-President, and House leaders in support of energy
efficiency and energy conservation, the energy bill passed by the
House does very little to promote energy efficiency. While the bill
does include some useful provisions, including tax incentives for
advanced efficiency technologies and some new equipment efficiency
standards, the bill leaves much larger energy-saving opportunities
off the table, such as significant improvements in passenger vehicle
fuel economy and establishment of a utility system benefit fund to
finance energy efficiency and renewable energy programs as well as
services for low-income consumers. In addition, some of the
provisions (e.g., equipment efficiency standards) that were included
in the bill are much smaller than needed while some (e.g.,
excessively high tax credits for modest improvements in home and
vehicle efficiency) are overly generous to industry.
Overall, ACEEE estimates that the House bill will save about 27
quadrillion Btus of energy on a cumulative basis by 2020, which is
about 1.3% of projected U.S. energy use over the 2002–2020 period.
If several amendments had not been rejected in Committee and the
House floor, they would have increased these savings by about
four-fold. The additional electrical savings from these amendments
would have reduced peak electrical demand by the equivalent of the
output of more than 1,000 300 MW power plants. The additional oil
and gas savings would have been equivalent to more than 5 billion
barrels of oil through 2020 (more than twice the oil that is likely
to be economically recoverable from the Alaska National Wildlife
Refuge over the same period of time).
In order to improve on the House bill, we recommend that the
Senate pursue the following enhancements:
- Adopt meaningful improvements in passenger vehicle fuel
economy standards. The provision in the House bill will improve
light truck fuel economy by about one mpg but will take back much
of the savings by extending a dual-fuel vehicle loophole that is
about to expire. As noted by the National Academy of Sciences, the
dual-fuel loophole should be phased out and passenger vehicle fuel
economy could be increased by much more than one mpg without
hurting safety, provided manufacturers have sufficient time to
prepare.
- Expand the appliance efficiency standards section to adopt
specific standards for torchiere lighting fixtures, transformers,
commercial unit heaters, traffic lights, exit signs, and
commercial refrigerators, based on standards developed in
California and new federal commercial furnace standards. These
additional standards would reduce peak electrical demand by the
equivalent of about 90 new 300 MW power plants.
- Incorporate a systems benefit fund to help states and
utilities offer programs to promote energy efficiency and
renewable energy and to assist low-income families with addressing
their energy needs. More than a dozen states have started such
programs on their own and initial results have been very positive.
A federal program would help additional states to start programs
and encourage existing programs to expand.
- Scale back overly generous tax incentives and use the money
saved to provide tax incentives for several additional types of
high-efficiency products. The House bill includes generous
incentives for vehicles that don't meet fuel economy or emissions
targets — this part of the vehicle incentives should be deleted.
Likewise, the House bill is overly generous to homebuilders who
build ENERGY STAR® homes. The credits for these vehicles and homes
should be scaled back and the money saved should be used to fund
expanded tax credits for combined heat and power systems and to
add tax credits for advanced heat pump water heaters, air
conditioners, gas water heaters, gas furnaces, and transformers,
as well as for new homes that substantially exceed the ENERGY
STAR® criteria.
- Establish interconnection standards for combined heat and
power systems and other types of distributed generation systems.
Some utilities impose onerous interconnection requirements in
order to stymie development of independent generation. The Federal
Energy Regulatory Commission should be directed to set
interconnection standards that establish the right to
interconnection and supplemental power while also adequately
addressing safety and federal/state/public power jurisdiction
issues.
Strengthened with the changes noted above, the energy bill would
truly promote energy efficiency in the United States, putting
substance behind the rhetoric and having substantial, positive
influence on the cost, reliability, and environmental impact of
energy use in the United States.