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March 28, 2003: Sempra Calls For Extending Federal ESPC Program

WASHINGTON — A Sempra Energy Solutions executive testifying on behalf of the Federal Performance Contracting Coalition (FPCC) told a Senate committee recently that reducing the skyrocketing energy bills at military and federal installations goes beyond “fiddling with the thermostat” and that time is running out for a successful, privately funded program that has saved the government millions in energy costs.

“A significant amount of the $4 billion annual energy bill for the federal government’s 500,000 buildings is ‘wasted money’,” said Erbin Keith, senior vice president for Sempra Energy Solutions at the U.S. Senate Energy and Resources Committee’s hearing on Energy Efficiency and Conservation.

Keith also warned that, without timely Congressional action, the successful energy savings performance contract (ESPC) program financed by the private sector will end on Sept. 30, 2003, when the government’s authority to enter these agreements ceases. “From 2001 to 2002, these projects reduced by almost half, while cumulative investment was reduced by more than 25 percent,” said Keith. “Without action by Congress, this program is in the final months.”

He attributed the decrease to a change in agency leadership and a lack of institutional experience and understanding of the programs. According to Sempra, contributing factors also include a cutback in federal energy manager positions and lack of support for third-party financing.

Sempra says that the investment of $1.2 billion by the private sector is projected to save the government and taxpayers billions of dollars over the life of the projects. Under the ESPC program, a private company finances the investment of installing energy-efficient equipment with no up-front costs to the government agency. At the hearing, Keith recommended the government take immediate action to extend the current energy performance contracting program and expand it to include water conservation, energy transportation, and power generation programs.

Publication date: 03/24/2003

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