H.R. 6, The Energy Independence and Security Act of 2007

Summary of Key Provisions

The President signed into law the most sweeping energy efficiency legislation in at least three decades on December 19, 2007. H.R. 6, The Energy Independence and Security Act of 2007, is projected to save American consumers and businesses more than $400 billion in avoided energy costs by 2030, and will reduce energy consumption by 7% and greenhouse gas emissions by 9% from the forecast for 2030, according to the American Council for an Energy Efficient Economy. Key provisions of this landmark legislation are highlighted below.

Appliance and Equipment Efficiency Standards
National appliance and equipment efficiency standards are a proven energy-saving policy. The first standards were established in 1987 and subsequent standards enacted by Congress in 1988, 1992 and 2005. The 2007 bill includes new standards for ten products, as follows:

• general service lamps (light bulbs) – see below for more details;
• reflector lamps (light bulbs) – extends 1992 reflector standards to more lamp types;
• residential boilers – updates existing federal standard;
• clothes washers – updates existing federal standard; sets water efficiency standards;
• dishwashers – updates existing federal standard; sets water efficiency standards;
• dehumidifiers – updates existing federal standard;
• electric motors – updates existing federal standard and extends coverage to more motors;
• metal halide lamp fixtures (commonly used in high-ceiling commercial and industrial applications) – new federal standard based on those of California, New York, and other states;
• walk-in coolers (refrigerators) and freezers – new federal standard based on California, Maryland and Rhode Island standards; &
• external power supplies (the small black boxes attached to the power cords of many electronic products) – new federal standard based on standards adopted in various states

Other standards provisions require DOE to complete rule-makings to determine revised standards for refrigerators by 2011; clothes washers by 2012; external power supplies and battery chargers by July 2011 and again by July 2015; dishwashers by 2015; walk-in coolers and freezers by 2012; metal halide lamp fixtures; and general service lamps by 2017 and 2022. DOE must issue a furnace electricity use standard by 2014. In addition, the bill requires that future standards for covered products incorporate energy use in standby mode and off mode. The bill requires DOE to determine whether a standard should be revised every six years, and, if a positive determination is made, allows another two years to issue a revised standard. The bill calls for DOE to review test procedures for both residential and commercial equipment at least every seven years.

The legislation allows DOE to set two regional standards for cooling products and one for heating products, in addition to the main national standard to better accommodate the range of climatic conditions across the U.S.

The appliance and equipment standard provisions represent about 20% of the overall energy savings estimated for the entire package.

Light Bulb Standards

The biggest energy-saver among the standards in the bill are those for common light bulbs (or “lamps” as they are called in the lighting trade), requiring them to use about 25-30% less energy than today’s most common incandescent bulbs by 2012-2014, and at least 60% less energy by 2020. The initial targets can be met by advanced incandescent lamps which the major manufacturers are introducing to the market, compact fluorescent lamps (CFLs) and light-emitting diodes (LEDs). CFLs and LEDs will also meet the longer-term targets and, based on industry statements, so will at least one incandescent technology.

Savings from the transition to more efficient lighting, in part due to the standard, will exceed the combined energy and money savings of all 21 federal appliance standards adopted since the year 2000. By the year 2020, the improved lighting is expected to lower consumers’ annual electricity bills by more than $13 billion and save more than 140 billion kilowatt hours per year – an amount exceeding that used by all of the homes in Texas in 2006.

Federal Energy Management Provisions

Other significant provisions in the energy bill require federal agencies to reduce their building energy consumption by 30 percent by the year 2015, which would save roughly $1.7 billion in taxpayer money each year (in 2006 the federal government spent $5.8 billion on energy for its buildings under this requirement; the federal government is the largest single consumer of energy in the United States). The bill also sets standards for fossil fuel use by new federal buildings, ultimately for no net fossil fuel use by 2030.

The new law sets new requirements for efficiency improvements in existing federal buildings, directing agencies to conduct energy and water audits every four years in buildings accounting for 75 percent of agency energy use, and to follow up on and track implemented measures. The law also permanently authorizes Energy Savings Performance Contracts (ESPCs), an innovative financing tool for upgrading the energy efficiency of federal buildings.

New Research, Development and Deployment Authorities

The legislation authorizes creation of an important and innovative new program to be administered by the Department of Energy. The Zero-Net-Energy Commercial Buildings Initiative (or “CBI”) combines research, development and deployment activities toward a goal of making all new commercial buildings “zero energy” on net, meaning that the facility produces as much energy as it uses, by the year 2030. Improving the energy efficiency of commercial buildings is critical as they represent about one-fifth of the total energy consumed in the U.S. and are responsible for one-fifth of the carbon dioxide emissions.

Corporate Average Fuel Economy (CAFE) Standards

Congress has not raised the corporate average fuel economy (or CAFE) standard for passenger cars since 1975. The energy bill just enacted requires the National Highway Safety Administration to increase the average fleet fuel economy standards for cars, light trucks, and SUVs to 35 miles per gallon by 2020. This provision alone will save consumers $22 billion in the year 2020 (equivalent to roughly $1,000 per year in fuel cost savings for each American family). The new standards also will cut greenhouse gas emissions equivalent to taking 28 million of today’s cars off the road.

The bill also calls for the first-ever efficiency standard for medium and heavy duty vehicles to be established.

Together, the new fuel economy standards represent fully 60% of the estimated total energy savings to be realized from the bill.