Issue Brief

Energy Efficiency

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Energy efficiency—the ability to maximize energy use via more efficient technologies throughout the electric utility system, as well as for electric customers to minimize their energy use by using a variety of tools, technologies, and behaviors—is one of the most important, cost-saving tools available to utilities to meet energy demand, defer generation investment, and reduce greenhouse gas and other emissions. The federal government creates incentives for energy efficiency through legislation, regulations, the tax code, and executive orders. The American Public Power Association (APPA or Association) provides tools and support for its members to deploy energy efficiency measures at their utilities. The Association is generally supportive of federal efforts to encourage and support such activities so long as they are cost-effective for consumers and have a reasonable payback period.


Congressional Action

Several energy efficiency measures were introduced in the 115th Congress. Of most interest to public power were:

S. 385/H.R. 1443—the Energy Savings and Industrial Competitiveness Act

Sponsored by Senators Rob Portman (R-OH) and Jeanne Shaheen (D-NH) in the Senate and Representatives David McKinley (R-WV) and Peter Welch (D-VT) in the House, these bills (which are similar, but not identical) would revise a variety of programs to encourage energy efficiency in buildings, the industrial sector, federal government, and certain appliances. S. 385 was reported out of the Senate Energy & Natural Resources Committee on May 10, 2017. It was also incorporated into S. 1460, the comprehensive energy bill introduced by Senators Lisa Murkowski (R-AK) and Maria Cantwell (D-WA). APPA supported S. 385, but also believes the mandates and other requirements in the bill should be changed to voluntary goals. The Association was particularly supportive of the following sections in S. 385:

l    Section 112—would authorize $10 million for career skills training programs for classroom instruction and on-the-job training for industry-related certification to install energy efficient building technologies. One of APPA’s strategic initiatives is workforce planning and development, and the Association believes this program, along with other workforce initiatives, would advance energy workforce development.

l    Sections 221 and 231—would establish rebate programs at the Department of Energy (DOE) to encourage the replacement of inefficient electric motors and transformers.

l    Sections 421 and 422—would repeal the requirement in section 433 of the Energy Independence and Security Act (EISA) of 2007 that new and existing federal buildings undergoing major renovations phase out fossil fuel-generated energy consumption by 2030. The federal government has been unable to find a long-term path for compliance with this unrealistic requirement. Sections 421 and 422 offer the federal government the flexibility to achieve its energy efficiency goals without the energy ban by providing energy intensity reduction goals; encouraging the use of energy management systems; reducing the frequency of energy audits for facilities achieving their energy intensity goals; requiring alterations and additions to existing federal buildings to meet model energy codes and requiring federal buildings to meet state or local energy codes where they are stronger; applying the standard of “30-percent-better-than-code” to major renovations; and strengthening the “30-percent-better-than-code” requirement.

H.R. 6584 and S. 3295—All-of-the-Above Federal Building Energy Conservation Act of 2018

Representatives Buddy Carter (R-GA) and Gene Green (D-TX) introduced legislation, H.R. 6584, the All-Above-Federal Building Energy Conservation Act of 2018, to repeal section 433 of EISA. Senators John Hoeven (R-ND) and Joe Manchin (D-WV) introduced companion legislation, S. 3295. Similar to sections 421 and 422 in the Portman-Shaheen bill, H.R. 6584 and S. 3295 would repeal the requirement that new or existing federal buildings undergoing major renovations phase out fossil fuel usage by 2030. They also included language to require the federal government to implement efficiency measures if they are deemed cost-effective. APPA was supportive of these bills, which unfortunately died at the end of the 115th Congress.

S. 1071—The Duplicative Green Building Program Evaluation Act

Sponsored by Senator Jeff Flake (R-AZ), S. 1071 would have directed DOE to evaluate potentially duplicative green building programs and determine if there are ways to eliminate overlap, improve coordination, and increase their effectiveness. The Association supported the legislation because it would have encouraged good governance and ensure maximum funding and management of green buildings programs at DOE.

At the beginning of the 115th Congress, House Energy & Commerce Committee Chairman Greg Walden (R-OR) and Energy Subcommittee Chairman Fred Upton (R-MI) signaled their intention to complete a comprehensive review of the Energy Policy and Conservation Act (EPCA). EPCA was enacted in 1975 to “increase energy production and supply, reduce energy demand, provide energy efficiency, and give the executive branch additional powers to respond to disruptions in energy supply.” Among other things, the statute directs DOE to conduct regular reviews of efficiency standards. APPA has been concerned about the pace at which DOE has been updating such standards and the burdens they create on utilities and consumers. However, the committee did not take up legislation to address issues associated with EPCA in the 115th Congress. The House Energy & Commerce Committee’s Energy Subcommittee, under new Subcommittee Chairman Bobby Rush (D-IL), held a hearing on March 7, 2019, to examine DOE’s failure to publish and update these standards.


Regulatory Action

On March 28, 2017, President Trump signed Executive Order (EO) 13783, entitled “Promoting Energy Independence and Economic Growth.” EO 13783 requires the heads of agencies to review all existing regulations, orders, guidance documents, policies, and any other similar agency actions that potentially burden the development or use of domestically produced energy resources. DOE formed a Regulatory Reform Task Force to conduct a review of agency action subject to review under the EO. On May 30, 2017, DOE published a Request for Information (RFI) in the Federal Register seeking input from entities significantly affected by DOE regulations. The RFI closed on July 14, 2017, with DOE receiving 132 public comments. After reviewing those comments, the Task Force recommended reviewing the DOE Appliance Standards Program, which sets separate test procedures and minimum energy conservation standards for more than 60 categories of appliances. On February 6, 2019, DOE published in the Federal Register a proposed rule that would amend its Process Improvement Rule to modify how the department develops efficiency standards. The proposed revisions would make it mandatory for test procedures on appliances to be released before efficiency rules are finalized and require DOE to use test procedures set by industry. The public comment period for the proposal will close on May 6, 2019. 


American Public Power Association Position

APPA strongly supports legislation to improve energy efficiency in multiple sectors. Many public power utilities have already taken steps either through federal incentives, other funds, or local initiatives to improve energy efficiency for their customers. The Association will continue to monitor and work on priorities with stakeholders in the House Energy & Commerce and Senate Energy & Natural Resources Committees in the 116th Congress. This includes working closely with the House Energy & Commerce Committee to ensure that the payback period for efficiency standards issued under EPCA are reasonable and cost-effective. In addition, APPA continues to support the goals and intent of S. 1071, S. 385, and H.R. 1443 from the 115th Congress. The Association also supports the repeal of section 433 of EISA and replacement of that section with more realistic efficiency requirements, such as those in H.R. 6584 and S. 3295.