On Feb. 27, U.S. Sens. Rob Portman, R-Ohio, and Jeanne Shaheen, D-N.H., introduced S 2074: Energy Savings and Industrial Competitiveness Act of 2014 — the latest iteration of the energy-efficiency bill that would, among other things, strengthen model building codes and promote energy efficiency in residential, federal, and industrial buildings. It is the fourth time the bill has been introduced since 2011, and, if enacted, would be the first energy-efficiency legislation in more than seven years.
Despite having widespread bipartisan support in both the U.S. Senate and House of Representatives, the bill faces an uphill battle as the tumultuous political climate of an election year threatens to stall the bill yet again.
Fourth Time’s a Charm?
The Shaheen-Portman bill was first introduced in the 112th Congress in 2011 as S 1000: Energy Savings and Industrial Competitiveness Act of 2011, though the bill, as a whole, never passed. It was again introduced in the 113th Congress as S 761 in April 2013, then modified in July 2013 and introduced as S 1392, with senate leadership vowing to make the bill a top priority upon returning from its August recess.
In October 2013, progress on the bill halted after senate Republicans and Democrats failed to reach an agreement to limit amendments, which included several amendments on controversial and non-germane issues like the Affordable Care Act and Keystone XL Pipeline.
Still, the Shaheen-Portman bill is the first piece of energy-efficiency legislation to make it to the Senate floor since 2007, and it has received widespread support from Republicans, Democrats, manufacturers, energy-efficiency advocates, and the U.S. Chamber of Commerce, among others. Support clearly exists for the bill, but the timing has not worked out — yet.
Shiny New Bill
The latest version of the bill includes 10 new amendments developed with bipartisan support, including an amendment that requires the U.S. Department of Energy (DOE) to recognize and utilize voluntary, third-party, independent certification programs for certain products, such as AHRI’s (Air-Conditioning, Heating, and Refrigeration Institute’s) certification programs. Guido Zucconi, assistant vice president of congressional affairs at AHRI, said AHRI is pleased with the amendment, which helps eliminate redundancy in the certification process.
“There’s no point, we thought, in having manufacturers go through AHRI’s process to certify compliance with federal efficiency standards only to also be subject to a DOE process,” Zucconi said. “So we thought, why would the government not simply rely on programs that are independent from manufacturers and laboratories, yet administered and funded within the private sector? We already oversee all the testing and independent third-party laboratories, and we submit the results to DOE so they can know the products are meeting their requirements. DOE maintains its enforcement role while programs, like AHRI’s, conduct an effective and efficient market surveillance program. There is no need for a duplicative government effort, and this amendment ensures there won’t be.”
Another amendment supported by AHRI would allow manufacturers to continue making water heaters for demand response programs. The amendment applies to large-capacity, grid-enabled, electric-resistance water heaters with a thermal storage capacity of 75 gallons or more and exempts those water heaters from the efficiency standards that go into effect in April 2015.
“The way the standards are written, these thermal storage water heaters would no longer qualify, or it would be almost impossible to manufacture them to meet efficiency standards,” Zucconi explained. “That would remove a whole subset of the market and put a lot of strain on the utility companies. The bill corrects that and creates a separate efficiency standard for these large water heaters. They are efficient, but you have to make them big in order to produce the hot water during the night, when peak demand is low, and store enough water for use during the day, when the utility companies need the extra energy to meet peak demand.”
The bill, with its new amendments, continues to receive steadfast support from environmental groups, including the Alliance to Save Energy. Alliance president Kateri Callahan called the legislation “common sense” and lauded its supporters.
“I’m thrilled to see Sens. Shaheen and Portman defying Washington gridlock and ensuring that energy efficiency leaps once again to the forefront of the national energy debate,” Callahan said, adding that the bill is estimated to save $16 billion annually, create more than 190,000 jobs, and cut CO2 emissions the equivalent of taking 22 million cars off the road.
“We are very proud of the progress we have made as an association in collaboration with our members and industry allies,” Zucconi said. “We are especially appreciative to Sens. Shaheen and Portman, as well as to Sens. Mark Pryor, D-Ark., Jeff Sessions, R-Ala., and John Hoeven, R-N.D., for their support of the bill and the amendments specific to HVACR and water heating products.”
One section of the bill amends the Energy Independence and Security Act of 2007 to include the Tenant Star Program — a new program aimed at helping tenants make energy-efficient improvements to buildings.
“It’s a voluntary program for lease-held space to attain a designation like Energy Star for the lease holder,” said Charlie McCrudden, senior vice president of government relations for ACCA. “So, let’s say you’re a company looking for office space in a large building, and you want to move into an Energy Star-recognized building, but they’re not available. You can make improvements to your own space in a way that gives you the Tenant Star designation. It just makes it easier for a tenant to be able to claim that his space is more energy efficient and achieve those savings.”
McCrudden said improvements can include efficiency upgrades to lighting, plug load, water usage, and more. “There is a whole menu of options you can choose from when you make improvements,” he said.
“Tenant Star is actually a pretty interesting concept,” Zucconi said. “It drills down further and creates an Energy Star-type program for building tenants, so if you do upgrades and reach a certain level of efficiency, you’d be able to advertise as a highly efficient tenant.”
Race Against Time
Even with its vast support, the bill still faces two big hurdles: the shrinking legislative calendar and a potentially volatile campaign season defined by congressional gridlock and partisan bickering.
“With summer approaching and Easter and Passover — and other pressing issues that are likely to come up, like unemployment, Russia, Ukraine, and the transportation bill — there are other matters Congress has to handle,” Zucconi explained. “And then you get very close to campaign season. Once primaries are close to being over, neither side wants to give the other a victory, and that’s going to start soon.”
The goal of the bill’s sponsors, Zucconi said, is to get it to the Senate floor before summer recess.
“They’re still trying to remove any roadblocks before it gets to the Senate floor,” he said. “They’re trying to figure out the pressing amendments, how to divide them among Democrats and Republicans so it’s even, offsetting costs, and making sure nothing is political in nature. They’re trying to do that before they have a public fight.”
“There are 10 new amendments — all of them worked out ahead of time — so these are noncontroversial and added with bipartisan support,” McCrudden said. “It makes the bill better because it has more provisions that have a lot of support. The problem is the issues that will come up when it goes to the floor — they are going to make it difficult. They haven’t resolved some of the controversial amendments yet. At some point, they’re going to have to bring this to the floor and have their day in court, so to speak.”
Jon Melchi, director of government affairs at Heating, Air-conditioning, and Refrigeration Disributors International (HARDI), said it’s possible the legislation will come up during the 113th Congress’ lame-duck session at the end of the year if it doesn’t make it to the floor before summer recess. Zucconi agreed, saying, “There’s always the lame duck, and things always happen last minute.”
Reservations aside, industry organizations remain supportive and cautiously optimistic that the legislation will finally pass this year.
“We are hopeful that, due to its bipartisan support, Congress will find a path forward for Shaheen-Portman and get it to the president’s desk,” Zucconi said. “The bill contains so many important provisions that will help preserve taxpayer dollars while improving energy efficiency that it is simply good public policy.”
Though Melchi admitted the bill doesn’t necessarily impact HARDI’s members directly, he said it is “something we support because it certainly benefits our manufacturing partners, and we want to be supportive of them.”
Still, nothing is certain in Washington right now — even the future of a politically neutral energy-efficiency bill with broad support.
“It’s not a bill that offends anybody, and there’s no real opposition to it,” Melchi said. “That’s good for the legislation, but now there’s the question of, can you get enough people interested in it to push it over the line?”
Publication date: 4/7/2014