Washington, D.C. – U.S. Senator Maria Cantwell (D-Wash.), ranking member of the Senate Energy and Natural Resources Committee, urged her Senate colleagues to include more provisions on energy efficiency in the bipartisan energy bill – the first comprehensive energy bill to be debated on the Senate floor since 2007.
Yesterday, Sen. Cantwell called for adding new measures to the Energy Policy Modernization Act of 2016 (S. 2012), including amendments:
- to establish a federal energy efficiency resource standard (EERS);
- to add the Sensible Accounting to Value Energy (SAVE) Act, which will allow for accounting of energy efficiency during the mortgage underwriting process; and
- to accelerate the transition to smart buildings.
“This bill aims to ensure that the nation is eliminating energy waste and making improvements in new technologies that will improve our competitiveness for the 21st century. Energy efficiency is the cheapest and most available energy resource,” Sen. Cantwell said.
A federal EERS would set modest and achievable energy savings targets that electric and natural gas utilities must meet. Efficiency has proven its success in improving the Nation’s energy productivity, and in delivering benefits to consumers and businesses alike. It is estimated that implementing a federal energy efficiency standard will save the economy $130 billion, and roughly $1,000 per household by 2040. Even now, cutting energy waste has saved taxpayers tens of billions of dollars each year.
The SAVE Act would allow homeowners the option to account the energy efficiency of their home during the mortgage underwriting process, and could help decrease foreclosures. On average, homeowners pay more than $2,000 a year for their energy use, making it the second largest cost in buying and owning a home. However, energy efficiency is not currently accounted for in the mortgage underwriting process. This amendment would allow homeowners to voluntarily choose to audit their homes for energy efficiency as part of the mortgage underwriting process, creating an incentive for homeowners to invest in home efficiency, because those improvements will be accounted for when they decide to refinance or sell their homes.
“In 2007, for the first time in our history, the United States actually de-linked economic growth from energy use. Now, our economy is producing more goods and services while using less energy,” Sen. Cantwell said. “This is a very important point because it shows that we can still grow our economy while consuming and using less energy.”
If enacted, the Energy Policy Modernization Act would establish a federal Smart Building Program at the Department of Energy, and foster public and private sector collaboration to help the U.S. transition to the widespread use of smart building technologies. Furthermore, the bill would promote research on improving smart technologies to help reduce their cost and protect against cybersecurity threats.
Read Sen. Cantwell’s full statement below.
“Mr. President, I come to the floor as we are moving forward, as many of my colleagues know, on this energy package.
“I thank my colleagues who have come to the floor already today to talk about it, including the senator from Alaska, Senator Murkowski, for helping us move as we work through so many different proposals by our colleagues. We were able to clear some amendments last week by voice votes, and hopefully, we will be able to move forward in the next 24 hours on this bill by getting some votes locked in.
“One of the things we are going to talk about this week is energy efficiency, which is creating jobs and making our economy more competitive by holding down the cost of energy.
“Many of us know that, for centuries, the use of energy has been a very important factor in our economy. Last week, I mentioned that the Northwest economy was built on a hydropower system. Cheap hydropower has worked for us over and over again, as companies that use a lot of electricity have moved to the Northwest. And we have stored everything from apples to terabytes of data because of the huge efficiencies that we were able to pull off with cheap hydropower.
“As my colleague from Alaska will say, energy costs are high in Alaska and she wants to make sure that we're making it more affordable and enabling distributed generation, as she just mentioned today. Ensuring that we have a micro-grid to do that is a key component to how the state will successfully diversify their economy. So each of us here, as we debate this on the Senate floor, are thinking about the regions of our country we represent, and how to make sure we're dealing with energy successfully.
“One of the things I want to discuss is that in 2007, for the first time in our history, the United States actually delinked economic growth from energy use. Now our economy is producing more in goods and services, yet using less energy. The chart behind me demonstrates this. This is a very important point because it shows that we can still grow our economy while consuming and using less energy.
“This is important if you're a homeowner and want to use the energy in your home more efficiently, while having many apps and devices that require electricity but make your life easier. It's also important for U.S. businesses competing in the global economy; they want produce goods and services and do so in a cost-effective manner. And so the more you can drive down energy costs without having to drive down consumption, the better.
“If we want to continue to compete in that global economy, we must continue to improve is energy productivity and that is exactly what this bill does. The Energy Policy Modernization Act will help ensure that the nation is eliminating energy waste and making improvements in new technologies that will improve our competitiveness for the 21st century.
“Energy efficiency is the cheapest and most affordable energy resource; it is typically about one-third of the cost of new production. That is, by saving energy at home, by using what we already have more efficiently -- and there are all sorts of smart ways to do this -- you can actually spend only one-third of the cost of what it would take to get new production on-line.
“In the last 40 years, since the oil embargo, energy efficiency became an integral part of our energy policy. We have learned that efficiency is not like most other resources that are depleted and consumed. Instead, we've found that as we keep making progress on energy efficiency, we've created new technologies. These have become the most cost-effective ways to cut waste. Energy efficiency is the most cost-effective way to take the ‘low-hanging fruit’ that is available in front of us and help businesses and homeowners alike.
“These are two examples of this that we, as the federal government, had a hand in: (1) automobiles and (2) lighting technology. Now, both of these were in the previous 2007 energy bill. Since then, average automobile fuel economy has improved dramatically from 15 miles per gallon in 1978 to 28 miles per gallon in 2016, thanks to the CAFE standards in effect. That's something we pushed here that made our automobiles more efficient.
“With respect to lighting, the latest light emitting diode (LED) technology is six to seven times more energy efficient than conventional incandescent lights and can last at least 25 times longer. In 2012 alone, nearly 50,000 LEDs were installed in the U.S., saving an estimated $675 million in annual electricity costs. What we are saying here is that we want to continue to move forward on energy efficiency. It is saving money for businesses and homeowners. We also want to continue the advancements of these energy efficiency technologies and make sure that we are making the right investments.
“I want to remind my colleagues that there are going to be several ways in which we're going to try to build on this progress. Energy efficiency must be a major part of our policies here, and I know that many states across the country are also making investments in this. So tomorrow I expect us to have a vote on an amendment to establish a federal Energy Efficiency Resource Standard, or an EERS.
“Since its establishment, the Department of Energy has implemented successful energy efficiency programs that develop new technologies and promote best practices within the major sectors of our energy economy. Yet many states have used their role to also establish energy efficiency standards. Behind me you'll see the number of states who have already developed incentives for investments in energy efficiency by giving utilities an incentive to invest in low-cost-efficient efficiency programs before investing in more expensive, new energy production. You can see that many of these states across the United States have adopted such initiatives – 25 states.
“Now, why is that important? Well, once you start down the path of energy efficiency, you continue to make your energy grid more efficient, which is something California has done. California made a huge investment as a marketplace for energy efficiency and now they continue to be on the cutting edge of energy efficiency. So they have continued to grow as an economy and yet use less energy. In fact, the 19 states with the greatest energy savings in the nation all have energy efficiency resource standards.
“To me, this is an area of the bill that I think we would like to improve. States are the laboratories of democracy, and because 25 of them have demonstrated the benefits of this policy, I believe it's time that the federal government should also establish a national Energy Efficiency Resource Standard. My colleague, Senator Franken from Minnesota, will be offering an amendment to do just that on this bill.
“The federal government could require states to do their part in reducing the waste of resources and increasing our nation's energy productivity by establishing an energy efficiency resource standard that would promote investments in efficiency – everything from cost-effectiveness in new buildings to production capacity. The proposed EERS would set a very modest, easily achievable energy savings target that electrical and natural gas utilities must meet as is already required in half of these states.
“The American Council for Energy Efficient Economy estimates that implementing a federal EERS would save $130 billion, or about $1,000 per household, by 2040. The adoption of this EERS amendment would more than triple the energy efficiency savings benefits of this act that's before us today.
“A federal EERS would not only save every American money by reducing their energy bills, but it would also strengthen our nation's economic competitiveness by improving our energy productivity and maintaining our leadership in the commercialization of these products.
“This is something that I learned in my time the private sector. Anytime you can make something that is of value to someone more efficient, such as energy, you are on the winning path. That is, if you become the experts of constantly knowing how to make everything more efficient, whether you're talking about development in China, Europe or in other parts of Asia, the fact that we are experts on energy efficiency by deploying this here in the United States gives us a winning hand in deploying it around the world.
“Anytime you can be more efficient, you're also being more cost-effective and saving dollars. That's what we're pushing in this bill. It will move the U.S. forward on energy efficiency.
“As we have seen, energy efficiency – and I’m sure Sen. Franken will talk more about this tomorrow – is not only commonsense economics, but it also has the ability to focus on some of the cleaner sources of energy that we have been discussing too.
“The federal government has a history of promoting energy efficiency, and the government itself – being the single largest energy user in the nation – could benefit from this. We hope that when we look at the federal government, we will also be talking about energy efficiency products. One of the examples of how Congress directed the federal government to lead was the enactment of Section 433 of the Energy Independence Act of 2007. This provision established a federal leadership role in the development of high-efficiency, low-emission commercial buildings by requiring the federal government to phase out the use of fossil fuel energy in federal buildings and major renovations by 2030.
“The U.S. government, as the single largest occupant of commercial buildings in the nation, should continue, I believe, to demonstrate its energy efficiency as well. I know in the Pacific Northwest, we have the Bullitt Center, which is the greenest commercial building in the U.S. We have a hospital in Issaquah that is the one of the most energy efficient hospitals in the United States, and we have other businesses that are developing these smart buildings that are driving down the costs.
“What does that mean? It means that businesses can invest money into R&D or into the manufacturing of goods or into the promotion of ideas, instead of spending it on energy costs.
“For us in the Pacific Northwest, with the cheapest kilowatt rates in the nation, someone might ask: why would everybody spend so much time on energy efficiency? We spend so much time on energy efficiency in the Northwest because we know it pays dividends. We know it gives us a competitive edge, and we know it continues to put us in the driver's seat of technology. So even though we have the cheapest kilowatt rates, we continue to make an investment.
“These buildings were designed by architects to show what's now technologically possible and feature state-of-the-art ground source heating and cooling, and both photovoltaic and thermal solar energy collection, computers that automatically adjust the building’s systems in order to keep them comfortable and efficient. Some buildings have an elevator that converts kinetic energy from breaking into usable electricity. All of these things are about cutting-edge technology.
“The Bullitt Center, and other buildings like it, demonstrate that it's technologically feasible and cost effective to phase out the use of fossil fuel-generated energy in new federal buildings within the next 14 years, as required by the current law. These aren't radical policies.
“These laws, which were passed in 2007, are things that I know some people here would like to repeal.
“Let me mention another one we will likely hear about, which is the SAVE Act, offered by our colleagues from Georgia and Colorado. The senators likely will offer this bill for sensible accounting to value energy. This bipartisan amendment was included in the Shaheen-Portman bill that would help homeowners account for the energy efficiency of their home during the mortgage and underwriting process.
“The average homeowner pays more than $2,000 annually for the energy used in their home. After the mortgage, this is typically the second-largest cost in buying and owning a home, but it is not accounted for in the mortgage underwriting process. Many of us have gone through the process of buying a home and getting a mortgage. So why can't a homeowner, on a voluntary basis, have their home audited for its energy efficiency characteristics and have that information accounted for in the mortgage underwriting process? This is what Sens. Isakson, Bennet, Shaheen and Portman have introduced in an amendment, and I think this will be one of the things that we will hear about tomorrow and one of the votes we will be having.
"A recent study from the University of North Carolina found that owners of more efficient homes are less likely to default on their mortgages. Adopting this amendment creates an incentive for homeowners to invest in energy efficiency improvements because those improvements will be accounted for in the underwriting process for their homes.
“Organizations as diverse as the U.S. Chamber of Commerce, the National Association of Manufacturers, the Alliance to Save Energy, and the U.S. Green Building Council all support this amendment. This is another idea that's not in the underlying bill that we will have discussion on. Today we're here with many amendments that were offered last week to this legislation.
“I thank my colleagues on both sides of the aisle for their hard work and for continuing to move forward with my colleague, the Senator from Alaska, Ms. Murkowski, and myself.
“I know my colleagues want to discuss this legislation, as I do, but we also know there is a limited time that we will be able to be on this legislation. So I urge our colleagues to bring any amendments to the floor tonight that they would like to have considered, if they haven't already filed them today.
“We need to continue to build on the success of the last 40 years, to cut our energy waste, and to de-link our economic growth from energy use so that we can continue to grow in the most cost-effective way and continue to produce the jobs that these new renewables and energy-efficiency opportunities are creating for us.
“I think this legislation will help give us another foothold toward a future economy that is cleaner, more efficient and a better driver of U.S. competitiveness on an international global basis for the types of energy solutions that will help the world as well.
“With that, Mr. President, I yield the floor.”