Some Thoughts on the House Energy Bill

On Tuesday, the House of Representatives passed the Comprehensive American Energy Security and Consumer Protection Act (HR 6899). While the bill itself is very wide-reaching, unfortunately the majority of it its focus (and debate) has gotten caught up in the issue of off-shore drilling, an issue that has been shown to have little impact (immediate or long term) on our national energy use and needs.[i] While the bill did pass the house, and now moves to the Senate to be voted on, President Bush has threatened to veto the bill.

Regardless of its unfortunate focus on drilling and its apparent doom by the hand of a presidential veto, the bill does include many positive provisions for efficiency in buildings. The bill also includes the GREEN Act of 2008, a bill sponsored by Rep. Perlmuttter (D-CO), a bill that FAS helped develop. Some of the many important measures included in the bill, along with some thoughts:

  • Title IV, Section 401 and 304 focus on improving energy efficiency provisions in building codes, which FAS has long advocated for. The measure directs the Energy Department to support updating national model building energy codes and standards for residential buildings (2006 IECC) and commercial buildings (ASHRAE 90.1-2004) at least once every three years (each runs on a 3 year revision cycle), in order to provide energy savings of 30% by 2010, and 50% by 2020 over . Targets for specific years shall be set by the Secretary at least 3 years in advance of each target year, coordinated with the IECC and ASHRAE Standard 90.1 cycles, at the maximum level of energy efficiency that is technologically feasible and life-cycle cost effective.

    This is a great step, but I’m uncertain how it will play out (if it doesn’t meet the death of a veto). There are a few problems. First of all, the department is only to “support” the improvement of these codes, which are developed through a consensus process managed by a private organization (the ICC), where each participant has an equal voice and no one individual group is able to dominate the discussion or direction of the process. This is evident in the current review cycle, where a group led by ACEEE (with DOE’s input) is attempting to improve the code by 30%, but has met resistance from the other members of the code development process (such as the National Association of Home Builders….more can be found on this issue in an earlier blog post, found here).

    So while the Department is to push for these improvements, the ability for the IECC to be moved to these targets depends heavily on the participants in the process. If the Department decides that the code does not meet these targets, the secretary shall establish a modified code or standard that DOES meet the targets, based on the IECC or ASHRAE 90.1-2004. Again, I’m not certain on how this will actually function, and if it will be successful. The model energy codes are adopted locally, either by state (which can be mandated to municipalities, or offered as an option/default), or by municipality (if there is no state requirement). The bill calls for states to adopt the DOE approved model energy code, but again it is unclear how this will be able to trickle down to actual improvements in buildings given each state’s different relationships between locally adopted codes and state adopted codes.

  • Title VI contains the GREEN Act of 2008, the bill sponsored by Rep. Perlmutter. The section creates minimum energy efficiency standards for all HUD sponsored buildings. One of FAS’s main suggestions, which we feel will be a major step towards improving our national building stock, is that the Secretary shall establish standards and requirements for energy audits for the purpose of retrofits. This is a large step for a national program for tapping into the potential of reducing carbon through existing residential building energy use. While there are many roadblocks to making a program of this nature work, one of the basic requirements would be for some sort of feasible and available audit system to determine what measures need to be done, and creating a standard for this would be one step down a road we really need to travel.
  • Most importantly, Title VI addresses energy efficient mortgages. FAS has looked into this concept in the past, and believes that they offer a powerful tool to push energy efficiency through home financing (and that the government has a unique opportunity to push Fannie Mae and Freddie Mac in this “green” direction given the government’s new status as owner of the two).

    The main push of the bill is to provide additional credits for energy-efficient homes,  create incentives for energy efficient mortgages in multi-family buildings, create information gathering systems to better evaluate energy efficient mortgages, and create education programs to expand the program. While this doesn’t rework the program in the ways needed to expand the program to its fully capacity, it sets the program up for future development through the information gathering and education campaigns.

The bill also extends a suite of renewable energy tax and energy efficiency tax credits and funds the provisions through repeal of oil industry incentives. The full text of the bill can be found at http://thomas.loc.gov/cgi-bin/query/z?c110:H.R.6899:


[i] According to a study by the Energy Information Administration, the projections in the Outer Continental Shelf access case indicate that access to the Pacific, Atlantic, and eastern Gulf regions would not have a significant impact on domestic crude oil and natural gas production or prices before 2030. In addition, because oil prices are determined on the international market, however, any impact on average wellhead prices is expected to be insignificant.  The report can be found here: http://www.eia.doe.gov/oiaf/aeo/otheranalysis/ongr.html

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