Statement:
Implement elements of the Climate Action Plan, including
- Supporting the goal of reducing cumulative carbon pollution by 3 billion metric tons by 2030 through standards set since 2009 and promulgating new standards for consumer products and industrial equipment by the end of calendar year 2016.
- Providing up to $8 billion in loan guarantees for advanced fossil energy technologies that reduce greenhouse gas emissions by the end of FY 2017.
Description:
Overview of the appliance standards part of the goal:
The Appliance Standards Agency Priority Goal is to reduce cumulative carbon pollution by 3 billion metric tons by 2030 through standards set since 2009 and to promulgate new standards for consumer products and industrial equipment by the end of calendar year 2016.
Residential and commercial buildings consume approximately 40 percent of the primary energy consumed in the United States. This amounts to over 39 Quads of primary energy used by the buildings sector per year, an amount that is greater than the yearly energy consumption of either the industrial or the transportation sector. By developing minimum energy efficiency standards, the Energy Department’s Equipment Standards and Analysis program helps reduce energy costs for consumers and businesses, as well as reduce associated energy use and emissions.
By covering a broad range of equipment—appliances, refrigeration, space heating and cooling, water heating and other electrical equipment—the Department's work with standards development and implementation increases energy efficiency in the residential, commercial, and industrial sectors. National standards that eliminate the least energy-efficient products from the market ensure that energy saving technologies are accessible to all consumers, provide manufacturers with a single set of requirements rather than an array of potentially conflicting state and local regulations, and drive technology innovation.
The Department uses three strategies to promote building energy efficiency, focused first on research and development of the most promising emerging technologies, followed by industry support activities such as Better Buildings and ENERGY STAR, and then the implementation of equipment energy efficiency standards.
As mandated by the Energy Policy and Conservation Act of 1978 (as amended), the Department’s Equipment Standards and Analysis program is developing and enforcing efficiency standards and test procedures to cover at least 75 percent of the energy used in the building sector. Under current law, covered products are responsible for 82 percent of residential building energy consumption, 67 percent of commercial, and approximately half of industrial. DOE is required to promulgate energy conservation standards that are technically feasible and economically justified, subject to the Energy Policy and Conservation Act’s (EPCA) seven factors. In determining whether a standard is economically justified, DOE determines whether the benefits of the standard exceed its burdens by considering these seven factors (to the greatest extent practicable):
(1) the economic impact of the standard on the manufacturers and on the consumers of the products subject to such standard;
(2) the savings in operating costs throughout the estimated average life of the covered product in the type (or class) compared to any increase in the price of, or in the initial charges for, or maintenance expenses of, the covered products which are likely to result from the imposition of the standard;
(3) the total projected amount of energy, or as applicable, water, savings likely to result directly from the imposition of the standard;
(4) any lessening of the utility or the performance of the covered products likely to result from the imposition of the standard;
(5) the impact of any lessening of competition, as determined in writing by the Attorney General, that is likely to result from the imposition of the standard;
(6) the need for national energy and water conservation; and
(7) other factors the Secretary considers relevant.
To maximize energy savings subject to EPCA, the Standards subprogram first meets all statutory and other legal deadlines for completing standards and test procedures. The Department is also committed to streamlining the process for developing and issuing rulemakings in partnership with industry and other stakeholders. To determine which products should be added through coverage determinations, DOE conducts analyses that examine the energy savings potential of various unregulated residential appliances, electronics, and commercial equipment while considering the impact of non-regulatory energy-efficiency programs currently available in the market. In addition to these actions, DOE also develops test procedures for ENERGY STAR, which is an effective non-regulatory program that saves consumers energy.
The Department is working to address a variety of different challenges associated with this work, including:
Standards require a robust test procedure to be effective.
Changes to the statute or its legal interpretation and the need for additional information in response to public comments on the draft rulemakings are factors that can affect the schedule for final issuance of the standards.
Energy price, product cost and consumer use projections vary and must be factored into the rulemaking process.
Stakeholder Engagement: Energy conservation standards are established by a four-phase rulemaking process: a framework phase, preliminary analysis phase, notice of proposed rulemaking (NOPR), and final rule. The Department actively encourages stakeholder participation and interaction at all stages of the process. Early and frequent interactions among stakeholders have been useful for providing a balanced discussion of critical information required to conduct the analysis to support any standards. Stakeholders include equipment manufacturers, building owners, State energy agencies, utilities, trade associations and other interested parties.
The Department also coordinates with the Federal Trade Commission (FTC) and the Environmental Protection Agency (EPA) on key certification and compliance issues with the Energy Guide Label and ENERGY STAR, respectively. The Department of Energy has also engaged with non-governmental organizations, such as the Collaborative Labeling and Appliance Standards Program, on international harmonization with respect to certification and compliance requirements.
Overview of the loan guarantees part of the goal:
As part of the President’s Climate Action Plan, the Loan Programs Office (LPO) issued the Advanced Fossil Energy Projects Solicitation, which makes up to $8 billion in loan guarantees available to support innovative, advanced fossil energy projects in the U.S. that reduce, avoid, or sequester greenhouse gases.
Fossil fuels currently account for more than 80 percent of U.S. energy production and are projected to remain a significant energy source in the future. As a result, President Obama’s Climate Action Plan announced that LPO would issue this solicitation to accelerate the deployment of cleaner fossil energy technology. This is an important part of the Administration’s long-term plan to achieve a cleaner and more secure energy future as part of its “all-of-the-above” energy strategy.
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