The Obama Effect: Driving Energy Efficiency and Economic Recovery

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With new funds in the pipeline and a new administration at the helm, communities nationwide are looking for ways to align their strategies for development with the tone and tenor of Washington. In order to help counties better understand the new mechanisms for addressing their energy needs, Brian spoke to NACo’s Energy Subcommittee about the opportunities for clean energy activities in the 2009 American Recover and Reinvestment Act (ARRA). He outlined the main recipients of ARRA funding for energy efficiency (which include state energy offices and local governments), as well as how those funds will be allocated, how interested organizations should apply for those funds, and what activities are eligible for funding.

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The Obama Effect: Driving Energy Efficiency and Economic Recovery

  1. 1. The Obama Effect: Driving Energy Efficiency and Economic Recovery National Association of Counties 2009 Legislative Conference March 7, 2009 Brian Castelli Executive Vice President, Programs & Development
  2. 2. Presentation Outline  What is the Alliance to Save Energy?  New Administration, New Energy Policy  2009 Stimulus Package – EE related $  On the Horizon: Energy & Climate?
  3. 3. What is the Alliance to Save Energy? Mission: To promote energy efficiency  Policy Leaders worldwide to achieve a healthier economy, a cleaner environment, and greater energy security. The Alliance is… Environ- Business The Alliance to Staffed by 50+ professionals  mental Leaders Save Energy Groups 31 years of experience in  policy, research, education, communications, technology deployment and market transformation Academia
  4. 4. Alliance Directors: Bi-Partisan Elected Officials and Industry Leaders Guided by a 37-Member, elected Board of Directors  Leaders of environmental, consumer, and trade  associations; state and local policy makers; corporate executives Senator Mark Jim Rogers, CEO Bi-partisan, bi-cameral Honorary Vice Chairs Pryor (D-Ark.) Duke Energy
  5. 5. Forging Alliances: Business, Government & Public Interests Sponsorship and participation of more than 150 organizations  Involvement by businesses in all economic sectors  Headquartered in Washington, D.C. with operations in several US  states, Eastern Europe, South Africa, Mexico, and India
  6. 6. Brief Post-Mortem on 2008 Energy Independence & Security Act (EISA),  P. L. 110-140; most sweeping energy bill enacted in over 30 years (Note: some provisions will now govern stimulus spending) Energy efficiency tax incentives were extended as  part of the Troubled Assets Relief Program (quot;TARPquot;) P.L. 110-343 -- October, 2008 Energy legislation adopted by House; Senate  “Gang of Ten” energy package developed
  7. 7. Inventing our Energy Future While Re-Building the Economy The imperative:  future of our economy and national security are “…the inextricably linked to one challenge: energy.” The path forward:  “To control our own destiny, America must develop new forms of energy and new ways of using it. This is not a challenge for government alone….It is a challenge for all of us.”  President Barack Obama, December 15, 2008
  8. 8. President Obama: Energy Efficiency Advocate – Reduce electricity use 15% by 2020 – Net-zero energy buildings by 2030 – Overhaul federal appliance standards – By 2014, reduce energy use in new federal buildings 45%; 25% in existing federal buildings – Flip incentives for utilities – Invest in a “smart grid” – Weatherize 1 million homes/year – Investment incentives for “livable cities”
  9. 9. “Making Good” on Promises: Early Action (Jan 09) Directs DOT to establish higher fuel economy  standards for vehicles by model year 2011 Directs EPA to reconsider the bid by California and  13 other states to set tailpipe carbon dioxide emission standards requiring greater fuel economy. Confirms intent to  - weatherize 2 million homes over the next two years; - make significant energy efficiency upgrades to 75 percent of federal buildings (savings of $2 billion in avoided energy costs); - double the country’s renewable energy resource base; and - create nearly 500,000 new “green jobs.”
  10. 10. Building a Green Economy Showed early commitment to large  green energy component in the economic recovery bill Budget assumes revenues from an  economy-wide cap-and-trade program to reduce greenhouse gas emissions, based on a carbon cap of 83% below 2005 levels in 2050 - The climate program would generate nearly $650 billion between 2012 and 2019 - House hopes to consider a joint climate & energy bill by Memorial Day
  11. 11. Stimulus Parameters…
  12. 12. ~$75 Billion Potential for EE
  13. 13. American Recovery & Reinvestment Act of 2009 – $787 Billion Total  ~$20 billion primarily for energy efficiency  $3.1 State Energy Program (SEP)  $3.2 EE Conservation Block Grants  $4.5 Green Federal Buildings  $0.3 ENERGY STAR appliance rebate  $5.0 Weatherization (WAP)  $1.25 undesignated funding for RDD&D In addition: transit, smart grid, ARPA-E, utility  infrastructure, school/university facilities, workforce, tax incentives, bonding authority, loan guarantees
  14. 14. ARRA – the main recipients State Energy Offices  - SEP funding formula - Guidance to come from DOE – Soon! Local Governments (Counties, Cities ), Indian Tribes, US  Territories, States and consortia of above - $2.8 Billion to be distributed per EISA allocation guidance - $ 400 Million to be competed Local Weatherization agencies  General Services Administration (GSA)  DOD, DOL and EERE 
  15. 15. Allocation of EE&CBG $2.8 B 68% to Large Cities and Counties  >35,000 population > 200,000 population OR in Small States one of the 10 most populous Cities or Counties 28% to States  - Of which 60% to Cities and Counties with < 35,000 population < 200,000 population 2% in direct formula grants from DOE to Indian  tribes 2% in competitive grants from DOE to Cities,  counties and Indian tribes not eligible for direct formula grants from DOE, and consortia of those entities
  16. 16. Application for the EE&CBG $2.8 B FedConnect, will be the mechanism for applying for the  EECBG Program https://www.fedconnect.net/FedConnect/PublicPages/FedC onnect_Ready_Set_Go.pdf - Step 1: Request a DUNS Number at http://fedgov.dnb.com/webform/displayHomePage.do - Step 2: Register with the Central Contractor Registry (CCR) at http://www.ccr.gov/. - Step 3: E-Business Point of Contact must register in FedConnect at https://www.fedconnect.net/FedConnect/. REGISTER NOW!!!  Process may take up to 21 days.
  17. 17. What Activities are Eligible for the EE&CBG $2.8 B 13 Activities are eligible – Key criteria will be  based on maximum impact in short-term for jobs to stimulate the economy WHILE laying a foundation for long-term sustainable energy future  DOE will provide more guidance on “categorical exclusions” to NEPA for some of the 13 programs.
  18. 18. What Activities are Eligible for the EE&CBG $2.8 B Residential and Commercial Building  Energy Audits  Financial Incentive Programs for EE  Energy Efficiency Retrofits  Energy Efficiency and Conservation Programs for Buildings and Facilities  Development and Implementation of Transportation Programs  Building Codes and Inspections
  19. 19. What Activities are Eligible for the EE&CBG $2.8 B Energy Distribution Technologies  Material Conservation Programs  Reduction and Capture of Methane and  Greenhouse Gases Traffic Signals and Street Lighting  Renewable Energy Technologies on  Government Buildings Development of an Energy Efficiency and  Conservation Strategy Any Other Appropriate Activity 
  20. 20. ARRA – the delivery mechanisms DOE (both administrator and recipient)  - Has created a “special organization” to disperse  MattRogers (of McKinsey Consulting) is leading this advisory team, which reports to Secretary Chu - EERE  EERE receives $3.5 B, of which $2.25 B earmarked for renewable energy and some EE  Gil Sperling is organizing DOE’s stimulus efforts for SEP and WAP from the Office of the Weatherization and Intergovernmental Program (OWIP)
  21. 21. ARRA – the confusion “plan then do” – obviously not happening   “Shovel ready” - projects vs. programs  Funds could begin flowing April, 2009  Funds to be expended in 18-24 months  Test case for future climate legislation  How do we measure success?
  22. 22. Stimulus Opportunities The State Energy Program  - In FY 2008 received $44 million - Stimulus provided $3.1 billion - The National Association of State Energy Officials has a listing of energy programs that receive funding through SEP, from Colorado’s Rebuild Colorado program to Wyoming’s Energy Conservation Improvement program, both of which utilize performance contracting - Browse programs state-by-state at http://www.naseo.org/projects/sep/updates/index. html
  23. 23. Stimulus + Policy State Energy Program funding requires  governor to state in writing that the State will: - Rate reform: Align utility financial incentives with energy efficiency, with cost recovery and earnings opportunity - Codes: Implement most recent model building energy codes and plan for compliance 23
  24. 24. Stimulus Opportunities The Weatherization Assistance Program  - In FY 2008 received about $500 million – two sources - Stimulus provided $5 billion The WAP Technical Assistance Center  (www.waptac.org) provides a page of “Ramp Up Tools” to help the weatherization network respond to the funding influx Other resources:  - National Association for State Community Services Programs (http://www.nascsp.org/) - Weatherization Plus & Leveraging Resources: http://www.opportunitystudies.org/weatherization-plus/
  25. 25. Stimulus Opportunities Federal-Level Resources  - General Services Administration received $4.5 billion to convert federal facilities into “High-Performance Green Buildings” - GSA’s Public Buildings Service houses the new Office of High-Performance Green Buildings - GSA Director of Expert Services Kevin Kampschroer will lead this effort - www.Recovery.gov and www.GSA.gov/sustainabledesign
  26. 26. General Services Administration funds: Alliance Recommends… Federal Energy Management Program Projects that: •Create the greatest impact through the use of From GSA funds energy and water efficiency and conservation $3 for energy and renewable energy across the federal efficiency retrofits billion government; •Are leveraged with private sector funds; and in federal buildings, •Are comprehensive and used for the take… construction, repair and alteration of Federal buildings in compliance with Section 432 of EISA (42 U.S.C. Section 8253) (f) (1) through (f) (7).
  27. 27. FY09 Federal Energy Efficiency Programs Funding (in millions of dollars) Program FY08 FY09 FY09 FY09 FY09 Change Change from 09 Approp. Request House Senate Omnibus from 08 Request Request Request Approp. Building Tech 108.999 123.765 168 176.481 140 28% 13% Commercial 11.891 13 33 40 Buildings Integration Industrial Tech 64.409 62.119 100 65.119 90 40% 45% Federal Energy 19.818 22 30 22 22 11% 0% Management State Energy 44.095 50 50 50 50 13% 0% Program Weatherization 227.221 0 250 201.181 200 -12% Assistance State & Local Block 295 50 Grants Total Above EERE 727.031 478.970 1378 857.781 775.238 7% 62% Programs Energy Star EPA 48.236 44.221 55 55 4% 13%
  28. 28. “New Funding”: Commercial Building Initiative Goals:  - 2030: New construction Net-Zero - 2050: Entire stock Net-Zero Broad government/industry consortium  Comprehensive approach (R&D deployment)  Coordinate (initiate) national and local actions  - Measure, benchmark, disclose energy performance - R&D for critical technologies and systems - Demonstrate scalable, replicable system solutions - Transform market: education/training, finance, appraisal, incentives, codes, buyer demand-pull
  29. 29. On the Horizon… …More Energy Efficiency?
  30. 30. Energy and/or Climate Legislation in the 111th Senate to consider energy bill in March/April;  House may introduce combined energy/climate bill  - Waxman’s goal is legislation by Memorial Day - Interest in National RPS/EERS (Markey has introduced bills) Obama FY 2010 anticipates “Cap & Trade”  proceeds beginning in 2012
  31. 31. Alliance “Complementary” Policy Recommendations: - Advanced building energy codes - Energy Efficiency Resource Standard - Vehicle Feebate - Appliance Standards - Building Labeling Programs and/or Requirements
  32. 32. Alliance Climate Policy Recommendations Alliance, together with other organizations, has  developed recommendations for the next climate bill and is briefing Congressional staff We are looking at evaluation, measurement and  verification; third-party programs; how much should be spent on R&D Despite economic woes, expectation that  Congress will enact/President will sign climate legislation this year or next
  33. 33. Climate Legislation Can Create Funding for RE & EE Estimated Allowance Allocation under Boxer Substitute Amendment to Climate Security Act (2008) $350 $300 $19 $19 $19 Allowance Value Allocated $18 $45 To Renewables $250 $44 $44 $16 $41 Bilion Dollars $15 $38 $200 $34 $13 $29 $11 Allowance Value Allocated $150 $25 To Energy Efficiency $100 $50 Other Allowance Value $0 2015 2020 2025 2030 2035 2040 2045 2050 Year
  34. 34. The Future is Ours to Invent! In the Short Term:  - The U.S. Economy is Re-built on Development and Deployment of Clean Energy and Technologies - Energy Efficiency is the “First Tool” in the Arsenal for Fighting Climate Change In the Longer Term:  - U.S. Becomes the Most Energy-Efficient Economy in the World
  35. 35. Planning Committee: Organized by an International Steering Committee Marc Bitzer Lena Ek Andreas Schierenbeck Nobuo Tanaka Jean-Pascal Tricoire Claude Turmes EVP, Whirlpool Corp. CEO, Building Executive Director, President and MEP (Luxembourg) MEP (Sweden) President, Whirlpool Europe Automation, Siemens International Energy Agency CEO, Schneider Electric Event Format: Exposition Hall: Business, Government and Other Exhibits from around the world 4 Plenary Sessions: Top business and environmental leaders engage with all conference attendees 24 Executive Dialogue Sessions: 90-minute concurrent sessions organized into 4 end use tracks featuring leading global voices selected by an international committee of experts and peers Networking Events: Many exciting events where business and pleasure are mixed Sponsors:
  36. 36. Thank you! For More Information…. Alliance to Save Energy 1850 M Street, NW Washington, D.C. 20036 www.ase.org 202.857.0666

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