06/08/15 : Reed Brown

Update on Proposed House and Senate Funding Levels for Energy Efficiency Programs

The Senate Appropriations Committee approved the FY 2016 Energy and Water Development Appropriations bill on May 21. This comes after the full House passed its own version of the spending bill on May 1. These appropriations bills cover, among other focus areas, funding for the Department of Energy (DOE), which includes the majority of the provisions relating to energy efficiency through the Office of Energy Efficiency and Renewable Energy (EERE).

The Senate and House versions differ in their proposals, with the Senate generally allocating slightly higher funding levels. While there is lukewarm support for these beneficial programs, both chambers fall short of the Presidential funding request for energy efficiency programs. A full breakdown of the energy efficiency funding recommendations for FY 2016 and how they compare to the FY 2016 Presidential Request, as well as the FY 2015 enacted levels, can be found here.

House

The Presidential funding request for EERE for FY 2016 would have increased the office’s budget by an impressive $800 million over FY 2015 levels.[i] Unfortunately, the House recommendations fall significantly short of the request and would fund EERE at $1.67 billion, $1 billion below the request and more than $260 million below FY 2015 funding levels. Furthermore, within EERE there are specific programs that focus on energy efficiency and these programs would see a reduction in funding of 40% below the Presidential Request or, comparatively, 5% below FY 2015 enacted levels.

Funding

There are a few programs that would experience significant changes in funding levels under the House recommendations.

  • The Building Technologies Office (BTO) would incur an overall reduction of 13 percent in funding.
  • Within BTO,  Equipment and Building Standards would experience the largest drop – 23 percent below FY 2015 levels.
  • The Federal Energy Management Program (FEMP) would incur the most drastic cut in funding – 30 percent below FY 2015.

One program would encounter a significant increase in funding, which is  Smart Grid R&D, which would be 30 percent above FY 2015.

Specific Language
  • Language was included again under the BTO section of the bill that states DOE is “directed not to advocate, promote or discourage the adoption or inclusion of a particular building energy code or provision, other than technical and economic analysis work, or provide funding to third parties or NGOs that engage in this type of advocacy.”
Amendments

Among the list of amendments that were added to the House funding bill, there are several that have direct implications for energy efficiency.

  • An amendment from Representative Burgess (R-Texas) prohibits funds in the bill from being used to enforce light bulb standards in the Energy Independence and Security Act (EISA) of 2007.
  • An amendment from Rep. Dent (R-Pa.) prohibits funds in the bill from being used to finalize, implement, or enforce the DOE’s “Standards for Ceiling Fans and Ceiling Fan Light Kits” proposed rule.
  • An amendment from Rep. Blackburn (R-Tenn.) prohibits funding in the bill for the enforcement of DOE proposed rules regarding the efficiency of residential gas furnaces.
Senate

In previous years the Senate funding recommendations have been markedly more favorable towards energy efficiency. While the numbers are lower than previous years, the Senate recommendations are still an improvement over the House recommendations. Overall, the Senate recommendation for EERE is $1.95 billion, which is about $800 million below the funding request, but is actually a 1 percent increase over FY 2015 levels.

Funding

These are some of the largest changes that energy efficiency programs would experience under the Senate’s funding recommendations.

  • BTO’s funding would be increased by 3 percent above FY 2015 levels.
  • The funding for the Residential Buildings Integration Program would increase by 14 percent.
  • The Advanced Manufacturing Office’s funding would be increased by 7 percent.
  • Funding for the Weatherization Assistance Program would be increased by 4 percent, as a result of an amendment offered at the full Committee markup by Senators Collins (R-Maine) and Reed (D-R.I.).
  • The only energy efficiency program to incur a reduction would be Smart Grid R&D, which would decrease by 1 percent.
Specific Language

The Committee expressed concern about DOE’s final rule setting for energy efficiency standards for commercial refrigerators, with apprehension that this standard was based on the performance of equipment that uses hydrofluorocarbons (HFCs) as a refrigerant. HFCs have been used for over 20 years, but will be phased out under a separate regulatory action by the Environmental Protection Agency. The Committee urges DOE to reassess its refrigerator standard in light of this potential conflict.

Next Steps

The appropriations process is far from completion. The Senate needs to pass its own version of the E&W Appropriation bill before the two Chambers can attempt to reconcile the differences between the bills in conference. The likelihood of an agreement between the House and Senate is unknown at this time, but due to the inclusion of the amendments mentioned above in the House version, the process will be complicated. In the event that a compromise cannot be reached, the funding for these programs will included in a Continuing Resolution.

The Alliance to Save Energy has consistently advocated for robust energy efficiency program funding across the federal government. The Alliance recognizes the significant challenges facing the federal government to reduce spending and spur economic growth, yet strongly believes that failing to fund EERE energy efficiency investments at these proposed levels would undermine America’s economic, environmental and national security interests. These programs provide exceptional value for American consumers and businesses, turning cost-saving opportunities into spending within other economic sectors, yielding benefits far beyond their nominal outlays. For these reasons, the Alliance will continue to urge Congress to provide robust funding for energy efficiency programs in FY 2016.

 


[i] CRS Report – “Energy and Water Development: FY2016 Appropriations.”