Alliance President Kateri Callahan's Statement

I would like to make a statement on behalf of the Alliance to Save Energy, a non-profit and non-partisan organization that has been advancing energy efficiency world-wide for nearly three decades.

Over the past 30 years, energy efficiency has been the leading resource in meeting our country's growing energy needs. As indicated on the chart displayed, thanks to public policies, technology innovation and aggressive energy standards and building codes, today energy efficiency contributes nearly 40 percent toward meeting our nation's energy needs. In other words, without energy efficiency, our nation would require 40 percent more energy to power our economic engine than it does right now.

But we've only tapped the surface. There is more — much more — that efficiency can contribute to displacing the need for new power plants, more petroleum, more natural gas, more energy.

Our studies indicate that the provisions in the Senate Energy Committee bill can reduce the anticipated growth in energy use over the next 15 years by roughly 8%. And, importantly, if the Administration and the Congress fully implement and fund the programs authorized in the bill, establish the energy standards, and meet the oil savings targets currently in the bill, the energy savings potential could be increased four-fold.

Important provisions currently in the Senate bill that must be retained to assure that efficiency is a cornerstone of our energy policy include:

1. Long-term reauthorization of the Energy Savings Performance Contracts, or ESPC program, without encumbrances. This program allows and encourages the Nation's largest energy user – the federal government – to make efficiency upgrades to its facilities, saving taxpayers millions of dollars in federal energy costs each year;
2. A set of provisions designed to jump-start state and utility energy efficiency programs;
3. Energy efficiency standards for appliances and equipment; and
4. a $25 million-a-year fund to support states in achieving high rates of compliance with the most current and aggressive energy building codes. As robust a package as the Senate Energy Committee has crafted, there are important missing efficiency provisions that must be added during Senate consideration.

Steve Nadel of ACEEE will address this with more specificity, but comprehensive energy legislation must include federal tax incentives for energy efficient vehicles, appliances, equipment and buildings. The House bill totally ignored the important market transformation that such credits would cause, providing only a paltry $500 million in credits over 10 years, while directing more than $8 billion toward supply side incentives.

And, the Congress simply must address the transportation sector –— our country's largest consumer of petroleum. With more than 50 percent of our oil today imported, and imports projected to rise to nearly 70 percent within the next 20 years, this is not just an energy and environmental issue for our country — it is an economic and national security imperative. The Alliance strongly urges the Senate to improve the fuel economy of our vehicles by closing the loopholes in the Corporate Average Fuel Economy (CAFE) program. We advocate sensible changes that will benefit consumers, like revising the testing procedures to reflect real-world driving and redefining SUVs and minivans to be what they actually are — passenger vehicles.

To get an idea of what such steps would mean in terms of energy savings, we can use as a comparison the Senate energy bill's directive to the president to develop and implement measures to reduce U.S. oil demand by 1 million barrels per day by 2015. By simply implementing the CAFE reforms advocated by the Alliance, we could reach more than 80 percent of that goal. As a last point, I would like to reiterate that passage of a comprehensive and meaningful set of energy efficiency provisions is but a first, albeit critical step, in charting a course for our country to reap the full benefits of energy efficiency. After Congress passes and the president signs into an energy bill, the real work of securing appropriations, establishing and enforcing standards, codes and regulatory requirements and educating the public will need to be undertaken with commitment, vigor and diligence.