Vision 2010

Vision 2010 Energy Efficiency Legislative Package -  Overview

(We are currently “shopping” this package on Capitol Hill and identifying Members of the House and Senate who may be willing to champion this legislative package. )

Why Improve Energy Efficiency?
The Alliance to Save Energy believes that policies and programs to advance energy efficiency must be a central focus of any sound national energy legislation.  Energy efficiency now contributes more than any single energy resource to meeting the country’s energy needs, and is the quickest, cheapest, and cleanest way to meet the anticipated growth in energy demand in the U.S. If not for energy efficiency and conservation measures taken since 1973, we would be using 40 percent more energy each year.  Federal policies and programs such as appliance and motor vehicle standards, research and development, and Energy Star made major contributions to these savings. 

Transportation
More than two-thirds of the oil consumed in the United States is used for transportation. This sector accounts for the majority of CO and NOx emissions in the U.S. and for one-third of U.S. greenhouse gas emissions.  Light-duty vehicle fuel economy has stagnated, while U.S. vehicle miles traveled are growing at more than twice the rate of the population.  Thus it is critical to improve the efficiency of today’s passenger cars and trucks immediately.  This legislative package:

• Reforms Corporate Average Fuel Economy (CAFE) standards by revising fuel economy tests so that CAFE reflects real on-road fuel economy, redefining passenger cars to include SUVs and minivans and to include heavier vehicles, revising the CAFE credit for dual-fuel vehicles to require actual use of alternative fuels, and testing and labeling the fuel economy of heavier light trucks.
• Applies a revenue-neutral feebate, including a rebate for efficient new passenger vehicles paid for by a fee on gas-guzzling vehicles, based on the anticipated fuel use by the vehicle over its life.
• Provides a tax credit for highly efficient hybrid vehicles, and eliminates the small business tax deduction for SUVs.
• Amends the EPAct alternative fuel vehicle fleet requirements to encourage use of hybrid and other highly efficient vehicles.
  

Buildings
Residential and commercial buildings account for about 40 percent of all energy use in the U.S., and many of the most effective government policies.  National appliance and equipment standards and state building energy codes provide an efficiency baseline that American consumers can trust, provide uniform rules for manufacturers, and slash wasteful energy consumption.  Energy Star labels and tax incentives are among the most successful programs in advancing energy efficiency through voluntary market transformation.  And as America’s largest, single energy consumer, the federal government wastes $1 billion in taxpayer dollars each year on inefficient energy use in its buildings.  This legislative package:

• Enacts appliance and equipment standards included in the H.R. 6 conference report and in new agreements between manufacturers and energy efficiency advocates.
• Increases funding for the Energy Star program, ensures Energy Star eligibility requirements are kept up-to-date, and authorizes matching funds for state rebates for Energy Star products.
• Creates a $25 million federal fund to support states achieving high rates of compliance with building energy codes, and updates the HUD manufactured housing standards to meet current model codes.
• Permanently reauthorizes Energy Savings Performance Contracts, expands the program to vehicles, sets federal building efficiency targets, and increases funding for the Federal Energy Management Program.
• Provides tax incentives for highly efficient new homes, improvements to existing homes, commercial buildings, heating and cooling equipment and appliances.
  
   

Industry
Industry accounts for one-third of all energy use in the U.S.  Energy-intensive industrial plants typically have enormous energy bills, sometimes running into the millions of dollars annually.  Energy efficiency improvements offer the potential for a significant return on investment for the industrial energy consumer in the form of lower utility bills, as well as for the public in the form of reduced pollution and energy prices.  This legislative package:

• Provides a 10% investment tax credit for combined heat and power systems up to 15 MW. 
• Authorizes DOE and EPA to enter into voluntary agreements with industrial companies for significant reductions in energy intensity, with verification and reporting. 
• Requires large industrial plants that emit at least 100,000 tons of CO2 in a year to begin reporting these emissions to the government. 
  

Electric and Natural Gas Utilities
In the 1980s and 1990s, states worked with regulated utilities using demand-side management programs to avoid the need for about one hundred 300-Megawatt power plants.  However, utility spending on public benefit programs nationwide was cut in half as states and the electricity industry prepared for expected deregulation.  New policy strategies have been devised to restore effective state and utility energy efficiency programs, including public benefits funds (PBFs), which provide funding for the programs from a small energy bill surcharge, and Energy Efficiency Performance Standards (EEPS), which require the programs to achieve a set performance target. These policies are needed to address natural gas supply constraints and reduce strain on the electric grid.  This legislative package:

• Authorizes a study by DOE and NARUC on state and regional policies to promote cost-effective end-use energy efficiency.  Authorizes 3-7 state pilot programs, with $30 million in funding over 3 years, to develop plans and programs designed to reduce electricity and natural gas consumption or demand by at least 0.75% per year.  Requires state regulators and non-regulated utilities to determine within four years whether or not it is appropriate to direct the implementation of energy efficiency policies and programs.
  

Cross-cutting Across Sectors
Federal energy efficiency R&D and deployment programs are among the most effective ways of helping to meet the anticipated growth in energy use, and have yielded a remarkable demonstrated return on investment for the government and consumers alike.  This legislative package:

• Doubles funding for energy efficiency R&D and deployment programs of the Department of Energy and Environmental Protection Agency over five years.

Updated March 23, 2005