New Report Demonstrates the Power of Prioritizing Energy Efficiency

Washington, D.C. (June 15, 2010): A report released today by the American Council for an Energy-Efficient Economy (ACEEE) at a Capitol Hill press conference with U.S. Senator Jeff Merkley (D-OR) shows that the Kerry-Lieberman American Power Act (APA) and the Senate Energy Committee's American Clean Energy Leadership Act (ACELA), while making a significant stride in the right direction, could benefit from even stronger energy efficiency measures to create additional American jobs and consumer savings. The report shows that by enhancing the energy efficiency provisions in the legislation, the number of jobs created could nearly triple, energy savings could quadruple, and consumer savings could increase by about $200 per household per year.

"If we want more jobs and more money in our families' pockets, then we should be using less energy -- it's a straightforward proposition," said Senator Merkley. "This report lays the very clear case that investing in energy efficiency makes our economy stronger and less vulnerable and gets Americans back to work."

The analysis found that by 2030, enhancing the energy efficiency provisions in the two pieces of legislation would increase direct energy savings from energy efficiency provisions from 5% to 16%, drive up the number of new jobs created from just over 100,000 to about 360,000, and increase annual consumer energy bill savings from $256 to $448 per household.

"These enhancements maximize the energy savings and the resulting benefits to society," said Steven Nadel, Executive Director of ACEEE. "Our analysis shows that strengthening the efficiency provisions in pending energy and climate legislation produces substantial reductions in household energy costs relative to both business-as-usual and the basic APA and ACELA legislation."

ACEEE's enhanced efficiency case included six changes to APA and ACELA:

· 10% Energy Efficiency Resource Standard (EERS), either separate from or combined with a Renewable Energy Standard (RES). An EERS establishes energy-savings targets for electric utilities, building on EERS requirements that have been adopted in 24 states.

· One-third of electric and natural gas utility allowances devoted to energy efficiency; this is an increase relative to the 1/5 required of gas utilities in APA, and no efficiency requirements for electric utilities.

· Industrial energy efficiency funding at 0.25% of emissions allowances until 2030; and the establishment of a Revolving Loan Fund with 1/3 of the Energy Intensive, Trade Exposed Industries (EITE) allocations. APA includes industrial energy efficiency funding only for 2013-2015. An unfunded Revolving Loan Fund is in ACELA.

· Continue providing emissions allowances for state energy efficiency and renewable energy programs out to 2030, and increase the percentage of emissions allowances to 6%. These allocations would approximately align with those in the House-passed American Clean Energy Security (ACES) Act.

· Increase energy savings in the transportation sector by targeting Highway Trust Funds and Transportation Investment grants in APA so that they achieve greenhouse gas reductions.

· Close a loophole in APA's the Clean Vehicle Technology Fund that lowers the bar for diesel vehicles to qualify and including only vehicles that exceed federal fuel economy standards by at least 25 percent.

Of these enhancements, ACEEE found that savings resulting from those that affect the industrial sector are particularly large, accounting for more than a third of the increased savings in the enhanced case. "Directing a portion of the emissions allocations to investments in industrial energy efficiency enables the modernization of U.S. manufacturing, resulting in important energy and GHG emissions reductions while insuring its global competitiveness," said Dr. Neal Elliott, ACEEE's Associate Director of Research. "Efficiency in industry is critical. The sector not only accounts for almost a third of U.S. GHG emissions, but the sector is also critical to achieving energy efficiency in other sectors of the economy since industry manufactures the clean energy products needed to realize the savings."

"The overwhelming evidence suggests that the more energy efficiency investments deployed, the more money consumers save and the more jobs we create," said ACEEE's Director of Economic and Social Policy, John "Skip" Laitner.

The full report, The American Power Act and Enhanced Energy Efficiency Provisions: Impacts on the U.S. Economy, is available for free download at http://aceee.org/pubs/e103.htm or a hard copy can be purchased for $35 plus $5 postage and handling from ACEEE Publications, 529 14th Street N.W., Suite 600, Washington, D.C. 20045, phone 202-507-4017.

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The American Council for an Energy-Efficient Economy (ACEEE) is a nonprofit research organization dedicated to advancing energy efficiency as a means of promoting economic prosperity, energy security, and environmental protection. 2010 marks ACEEE's 30th anniversary as an organization. For more information, contact ACEEE at 529 14th St. NW, Suite 600, Washington, D.C. 20045. www.aceee.org.