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Home STAR and Building STAR Legislation to Stimulate Energy Savings and Jobs Creation

March 29, 2010
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Since its introduction in 1992, Energy Star®, the voluntary labeling program designed to identify and promote energy-efficient products, has successfully delivered energy and costs savings across the country. In fact, this joint program of the U.S. Environmental Protection Agency (EPA) and the U.S. Department of Energy (DOE) saved enough energy in 2009 alone to avoid greenhouse gas emissions equivalent to those from 30 million cars - all while saving Americans nearly $17 billion on their utility bills.

In the past month, Congressional leaders have introduced two new federal bills - Home STAR and Building STAR - that use short-term rebates rather than labels to promote energy efficiency in residential and commercial structures. At the same time, each of these programs is expected to create a minimum 150,000 jobs, many of them in the hard-hit construction sector and in related industries, including the HVAC industry.

The proposed Home STAR program was introduced by Sens. Jeff Bingaman (D-N.M.), Mark Warner (D-Va.), Bernie Sanders (D-Vt.), and Jeff Merkley (D-Ore.). Aimed at the residential market, this piece of legislation would invest $6 billion in a rebate program for homeowners who perform a number of energy efficiency upgrades. The SILVER STAR prescriptive path offers incentives for specific energy saving investments, including air sealing; attic, wall, and crawl space insulation; duct sealing or replacement; and replacement of existing windows and doors, furnaces, air conditioners, heat pumps, water heaters, and appliances with high-efficiency models. The GOLD STAR performance path provides an incentive to households that conduct a comprehensive energy audit and then implement a variety of measures that are designed to provide greater returns in energy savings.

Building STAR is a parallel program introduced by Sens. Jeff Merkley (D-OR) and Mark Pryor (D-Ark.) that promotes energy efficient retrofits of commercial, institutional, and multifamily buildings. The product of a consultation among members of Rebuilding America, a coalition of more than 60 business, real estate, financial, labor, consumer and advocacy organizations, and a wide range of technical experts, Building STAR consists of a two-pronged voluntary approach: a simple and straightforward prescriptive rebate plan and a package of improvements to existing, and in some cases proposed, tax incentives and codes.

Building STAR would authorize a rebate program for building owners who install or implement energy-efficient building equipment, materials, products and services during 2010. The rebates would cover approximately 30 percent of the cost of installing and/or implementing these products and services and are largely based on proven, existing state-level utility and other rebate programs.

INDUSTRY IMPACT

A list of products and services covered by Building STAR includes building envelope insulation; mechanical insulation; windows, window films, and doors; low-slope roofing; HVAC equipment, chillers, water heaters and boilers; duct testing and sealing; variable-speed drives for motors; interior and exterior lighting; building energy audits, commissioning, tune-ups, and training; and energy management and monitoring systems. These rebates, like those proposed in Home STAR, present a variety of opportunities for the HVAC industry to provide the products and services that will enable and encourage building owners to participate in the program and reap its benefits.

The new or expanded credits proposed as part of Building STAR support technologies and equipment that could deliver significant reductions in energy use, including the installation of variable-speed drives and new, more efficient chillers to replace the more than 25,000 less-efficient CFC chillers still in operation today. Building STAR also includes a financing program to help building owners pay for the portion of the retrofit not covered by rebates.

Funded with a $6 billion federal investment, Building STAR would leverage $3-4 in private investment for every federal dollar spent, spurring a total market activity of $18-$24 billion and making the bill a model for public-private partnerships and maximizing resource efficacy. The ripple effect begins when the homeowner or building owner invests in energy efficiency, and continues through the contractor to the retailer and eventually to the manufacturer as products are secured and services delivered.

In addition, Building STAR is expected to save building owners more than $3 billion on their energy bills annually by reducing enough peak electricity demand to avoid the need for 33 300-megawatt power plants. It will also reduce the pollution that contributes to climate change by 21 million metric tons, or the equivalent of nearly 4 million cars’ emissions each year, according to the American Council for an Energy-Efficient Economy.

The projected jobs growth and increased energy savings, along with the positive impact on our environment, make both Home STAR and Building STAR especially attractive pieces of legislation for the HVAC and building construction industries that take advantage of existing technology and expertise and a workforce eager to return to work.

But these programs provide another important benefit - the opportunity and encouragement to train technicians and contractors in technologies and services that are less familiar to them - conducting building energy audits or installing variable-frequency drives, for example - expanding skill sets and building an infrastructure that can help grow businesses today and sustain businesses tomorrow. Energy costs will continue to escalate, so anything new that a contractor or manufacturer can offer in the way of energy efficiency and cost savings will create opportunities to grow their business and establish themselves as a reliable energy partner.

What’s more, as they’re acquiring this training and mastering these new skills, they are working to the high quality assurance standards established by this proposed legislation. As a result, both residential and commercial building owners can be confident in the products and services they are receiving, even as they anticipate substantial energy savings, reduced utility bills, and the satisfaction that they are positively impacting their environment.

NEXT STEPS FOR LEGISLATION

Both Home STAR and Building STAR have been referred to the Senate Energy and Natural Resources Committee and House Energy and Commerce Committee for deliberation, investigation, and revision, perhaps combining these bills with other job-creating measures. From there the bills would move to the floors of the Senate and House for general debate and votes.

Home STAR and Building STAR have the potential to accelerate the growth of those industries that are focused on making homes and buildings more energy efficient. Contractors stand to benefit as do HVAC technicians, mechanical engineers, and manufacturers of energy efficient products who together will apply their expertise and technology to help generate billions of dollars in energy savings for the American consumer.

Individuals or organizations interested in expressing their views on either piece of legislation can contact their Senators and Congressmen by visiting www.senate.gov or www.usa.gov. For a complete list of those organizations and companies that belong to Rebuilding America and have endorsed Building STAR, visit the coalition’s Website at www.energyfuturecoalition.org.

Publication date: 03/29/2010

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