In our eight-part series, we examine initiatives outlined in recent congressional Democratic climate proposals, particularly the Climate Leadership and Environmental Action for our Nation's (CLEAN) Future Act introduced by House Energy and Commerce Committee Democrats and the Moving Forward infrastructure framework developed collectively by House Democrats.
Continuing our series, we're focusing on provisions affecting energy efficiency, from appliance standards and building codes to upgrades to the electricity transmission system. Both the CLEAN Future Act from the House Energy and Commerce (E&C) Committee and the Moving Forward framework from the House Committee on Transportation & Infrastructure (T&I) would make meaningful policy changes, backed by the authorization of substantial federal funding, to reduce energy consumption across the economy.
Despite energy efficiency often serving as the least-cost option because efficiency investments are typically cheaper than building new electricity generation or consuming additional fuel, the U.S. Energy Information Administration (EIA) has reported declines in utility energy efficiency program spending for two years running. The provisions in the two House bills would incentivize businesses, homeowners and consumers to save energy, and the federal investments would ensure that the costs of achieving those savings remains at or below the cost of alternative options.
Notable energy efficiency proposals from both frameworks are outlined below.
Building Codes and Retrofits
The CLEAN Future Act establishes national energy savings targets and directs the U.S. Department of Energy (DOE) to develop model building codes to achieve those targets. To encourage states and tribes to adopt the model codes, the bill would authorize federal funding to those that comply and withhold energy- and building-related funding from those that do not.
For existing buildings, the CLEAN Future Act establishes a home energy savings retrofit rebate program, providing up to $1,500 for homeowners to install insulation and replace their heating and cooling system. The bill also significantly increases the authorized funding level for the Weatherization Assistance Program, which funds energy-saving retrofits for low-income households, as well as adds new requirements for public sector recipients of federal energy efficiency grants to ensure that savings will be realized. To encourage energy savings performance contracts (ESPCs) at federal facilities, the bill expands the funding vehicles for federal agencies to pay for such projects. The bill specifically addresses and provides grants for efficiency opportunities at schools, especially those that improve indoor air quality and lighting.
The Moving Forward framework has similar goals in this area and makes similar policy recommendations. For example, the T&I bill would provide $1.85 billion over five years for home and school energy efficiency retrofits, $1.75 billion over five years for weatherization grants, and $17.5 billion over five years for grants to local governments to fund energy efficiency and conservation projects.
Industrial and Power Sector Efficiency
The CLEAN Future Act would expand DOE support for combined heat and power (CHP) and waste heat to power at industrial facilities. DOE also would be required to work with the National Academies of Sciences, Engineering, and Medicine to develop a plan to promote "smart" manufacturing technology deployment to improve the energy efficiency of the manufacturing sector.
More broadly, the CLEAN Future Act would establish a national clean energy standard, requiring an increasing percentage of clean electricity in the generation mix until we reach 100 percent in 2050. Under such a framework, energy efficiency would be valued alongside renewable generation sources like wind and solar, and would be incentivized by virtue of the fact that it is by definition a zero-emissions technology. Revenue from penalties levied on noncompliant utilities also would be redistributed to states, and energy efficiency is first in the list of technologies explicitly authorized for those funds.
In addition, a number of provisions in the CLEAN Future Act would require the Federal Energy Regulatory Commission (FERC) to develop regulations to improve the efficiency of the interstate electric grid. The Moving Forward framework would provide substantial funding to overhaul the grid and make those efficiency improvements easier to achieve. While details are sparse, the framework "provides $4 billion over five years for electric grid infrastructure to accommodate more renewable energy and to make the grid more resilient." That funding would focus on efficiency, among other initiatives, and would finance efficiency upgrades.
The Moving Forward framework would create a "green reserve" for water and energy efficiency projects under the Clean Water State Revolving Fund (CWSRF), a popular but overburdened program that provides low-interest water infrastructure loans to states and communities. By increasing spending for the CWSRF while broadening the range of eligible projects, the T&I proposal would provide an additional revenue stream to improve energy efficiency and increase resiliency through expanded utilization of natural infrastructure.