States awaiting stimulus funds will be pleased to know that when it comes to funding energy efficiency programs, their dollars will go far. Drastically reduced energy consumption and immediate job growth are just some of the benefits that effective policies and programs can bring, particularly to the Appalachian region, which has the highest energy consumption in the country. Kateri Callahan presented these findings to the annual Charlotte Regional Partnership Investors Board in Charlotte, N.C., where already progressive energy efficiency policies and programs are taking root. Callahan also briefed the audience of investors and board members on the climate and energy bills moving through Congress.
Energy Efficiency – Good for the World’s Economy; Good for the Nation’s Economy; Good for Yours!
1. Energy Efficiency – Good for the World’s Economy; Good for the Nation’s Economy; Good for Yours! Presentation by Kateri Callahan, President Charlotte Regional Partnership Investors Forum July 29, 2009
2. Overview A Few Words About the Alliance Why Energy Efficiency? Why Now? Policy: Tapping the Full Potential of Energy Efficiency Regional/State Leadership: Building Green Economies One by One Forecast for the Future: Energy Efficiency as the Foundation of a New, Green Economy
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4. Guided by a 37-Member, Elected Board of Directors
5. Led by Senator Mark Pryor (D-AR) and Jim Rogers, CEO of Duke Energy
11. Enormous Savings Energy Efficiency AVOIDING roughly 2.5 billion tons of CO2 annually Saving roughly$400 billion annually
12. Why Now? Energy Use is a Global Climate Issue Source: Energy Information Administration
13. 18 18 Other renewables Other renewables Biomass Biomass 16 16 Hydro Hydro 14 14 Nuclear Nuclear Gas Gas 12 12 Oil Oil 10 10 Coal Coal billion tonnes of oil equivalent billion tonnes of oil equivalent 8 8 6 6 4 4 2 2 0 0 1980 1990 2000 2010 2020 2030 1980 1990 2000 2010 2020 2030 Why Now? Growing Energy Demand is Unsustainable Global demand grows by more than half over the next quarter of a century, with coal use rising most in absolute terms
14. Why Now? U.S. Growth in Energy Use Poses a National Security Threat
16. Why Efficiency? Cheapest, Quickest, Cleanest…. Annual world-wide investment of $170 billion in energy efficiency through 2020 could: cut global growth in energy demand by ½! save $900 billion a year in avoided energy costs dramatically reduce greenhouse gas emissions Source: The McKinsey Global Institute
17. Why EE? Enormous Potential for Savings in ALL Sectors… Source: McKinsey Global Institute
19. EE: Enormous Potential for Regional Job Growth… The same study reveals that cost-effective energy policies can positively impact the larger Appalachia economy, creating 77,378 jobs regionally.
20. The Challenge? Market Distortions Principal Agent or “Split Incentives” Home/Commercial builder versus buyer Landlord versus tenant Utility versus customer Transaction Costs Lack of information on life-cycle cost for products and/or paybacks for upgrades Lack of Investment in RD&D and EE Programs
21. How Do We Unlock the Potential of Energy Efficiency?
22. Five Tenants of Sound EE Public Policy Research, development and deployment (RD&D) Education and outreach Incentives and Financing Mechanisms Standards & Codes Government “Leadership by Example”
23. A Big Year for Energy Efficiency in Public Policy October 08 January 09 2008/2009 June July May May May Obama’s election platform American Recovery & Reinvestment Act (ARRA, or Stimulus Bill) President’s Fiscal Year 2010 budget NEW! American Clean Energy and Security Act (ACES) Ongoing appropriations in House and Senate climate & energy bills President’s new CAFÉ standards House PASSES ACES (6/26) DOE: new lighting standards
45. Core Energy FundingObligation & Spending to date SEP Appropriated: $3.1 billion Obligated: $301.6 million Spent: $9.4 million EECBG Appropriated: $3.2 billion Obligated: $0 WAP Appropriated: $5 billion Obligated: $553.4 million Spent: $8.3 million Green Jobs Appropriated: $500 million Obligated: $0 Smart Grid Investment Grant Program Appropriated: $4.5 billion Obligated: $0 Smart Grid Demonstration Projects Appropriated: $615 million Awarded: $4.7 million Spent: $0 HUD’s EE Public Housing Capital Funds Appropriated: $4 billion Awarded: $0 HUD’s Green Retrofit Program Appropriated $250 million Obligated: $0 $890 million of $18 billion awarded (.5%)
46. ARRA Funding for EE North Carolina: State Energy Program (SEP) Appropriated: $76 million Awarded: $30.4 million (June 25) Weatherization Assistance Appropriated: $132 million Obligated: $53 million (June 18th) Weatherization goal: 23,500 homes Energy Efficiency and Conservation Block Grants* Appropriated: $ 58 million South Carolina State Energy Program (SEP) Appropriated: $51 million Awarded: $20.2 million (June 25) Weatherization Assistance Appropriated: $59 million Obligated: $24 million (June 18th) Weatherization Goal: 6,500 homes Energy Efficiency and Conservation Block Grants* Appropriated: $ 31 million
47. State Energy Program Plans Updated regularly on our stimulus resources page: www.ase.org/stimulusresources
48. Uses of Funds:State Energy Programs Plans North Carolina: Support small business and industry through energy savings ($11.5 million) Grow North Carolina’s green workforce- ($8.85 million) Foster renewable energy technology and resource innovation ($13.5 million) Improve energy efficiency in local and state government ($9.5 million) Promote residential energy efficiency and renewable energy ($10 million) Create an Energy Investment Revolving Loan Fund ($18 million) South Carolina: Improve energy efficiency in Public Institutions ($40 million) Create South Carolina Energy Efficiency Training Center Collaborative ($.9 million) Establish Small Business/Utility Partnership for Energy Efficiency Equipment ($50 thousand) Improve energy efficiency in Low-Income Manufactured Housing ($3 million) Establish Carolina Clean Green Investment Incentives ($3 million) Establish Competitive Renewable Energy Grants Program ($3 million)
49. Oversight and Advocacy Immense problems of implementation size and complexity; challenge of administration within limited time frame; political appointees not in place; demands on career appointees Credibility of future energy efficiency initiatives depends on competent and effective implementation Problem of EM & V: How do we measure savings? Continuity of Programs: What happens when the funding goes away?
50. A Word on Federal Tax Incentives New Homes Builder tax credit - up to $2,000 if 50% more efficient compared to 2004 IECCC code; $1,000 for a home that saves 30% or qualifies for the Energy Star Homes Program. (Through 2009) Existing Homes Homeowner tax credit – 30% of cost of installing building envelope components; capped at $1,500 (Through 2010) Commercial Buildings Deduction up to $1.80/sq.ft. for buildings designed to use 50% less energy than ASHRAE-90.1-2001 (Through 2013) Combined Heat and Power property – 10% investment tax credit, applicable to only the first 15MW of CHP property (Through 2016) Solar Energy Systems- 30% tax credit of the cost of the system (Through 2016) Small Wind Systems- 30% of total cost for owners of small wind systems with 100 (kW) of capacity and less (Through 2016) Geothermal Heat Pumps- Investment tax credit of 10% of installed cost or a grant in lieu of the credit worth 10% (Through 2010) Public Buildings:Assignable deduction!
51. Next Up? Energy and Climate Legislation In the House ACES (The American Clean Energy and Security Act, or Waxman-Markey) Status: Narrowly passed the House on June 26th by a vote of 219 to 212. In the Senate ACELA (The American Clean Energy Leadership Act) Scope: Energy Only Status: Approved by Energy Committee on June 27th
52. ACES:Cap is the crown jewel 85% of US GHG emissions covered Could be higher Covered emissions reduced 83% in 2050 Defend and protect the cap!
53. ACES: Goals for Energy Efficiency Policies will no longer save more energy. Instead they will— Reduce cost of meeting carbon cap by Addressing market barriers, especially among energy end-users
54. ACES: EE Programs Complementary EE policies Codes, standards, building labeling, electric efficiency resource standards; authorizations; financing mechanisms Complementary Programs EE in WM is 3-6% of allowance value $81 to $167b over 2012-2050 12.5% of allowance value could get Allowance prices 10% lower Electric, nat gas and petrol prices 1-3% lower Electric and natural gas demand 3-7% lower according to EPA analysis April 20
55. Climate Outlook in Senate Senate EPW to release draft in September At least six other committees have jurisdiction over climate legislation; Senator Reid has asked these Committees to conclude deliberations by Sept. 18 Majority Leader Reid wants to bring comprehensive bill to the floor in the fall; we are hearing October for floor action Opponents/Proponents in “Pitched Battle”
56. ACES: Where the Votes Are States with majority of votes in the delegation for the Waxman-Markey bill are in green; states with majority opposing W/M are in red
68. Unleashing the Power of Charlotte: Suggestions for Success National Action Plan for Energy Efficiency EEI, NARUC, EPA, DOE… EPA Clean Energy-Environment Guide to Action DOE, NARUC, NASEO, ASE, RAP State Energy Efficiency Policies: a Series of Briefs, pub. by the Alliance Western Governors Association Energy Efficiency Task Force Report
69. EE Global 2010Monday, May 10 to Wednesday, May 12, 2010Washington DC Convention Center, Washington DC EE Global 2010, will serve as the “Davos” of the energy efficiency community, drawing over 600 leaders from government, industry, NGOs, and media from 40+ countries together to share best practices and policies for global implementation of energy efficiency. With over 80% of 2009 participants self-identifying as executive or management-level, participation in EE Global will provide access to energy efficiency’s most notable leaders and decision makers.
70. Final Words… “Our greatest national energy resource is the energy we currently waste.” Former Energy Secretary Spence Abraham
71. Thank you! For More Information…. Kateri Callahan President Alliance to Save Energy 1850 M Street, NW Washington, D.C. 20036 kcallahan@ase.org www.ase.org 202.857.0666
Notas del editor
Example: Appalachia Region (area covered includes NC and 1/5 SC)A study by Alliance sister organization, the Southeast Energy Efficiency Alliance, for the Appalachian Regional Commission shows that a bold energy efficiencyinitiative could cutconsumption by 11 percent to 8.2 quadsin 2020 and by 24 percent to 7.7 quads in2030.Energy Efficiency in Appalachia: How Much is Available, at What Cost, a
Total Stimulus Funding for SEP, WAP, EECBG:NC: $266 millionSC: $139 million State Energy ProgramNorth Carolina – Awarded $30.4 million on June 25th (Appropriated $76 million)South Carolina – Awarded $20.2 million on June 24th (Appropriated $51 million) Weatherization Assistance ProgramNorth Carolina – Awarded $53 million on June 18th (Appropriated $132 million)South Carolina – Awarded $24 million on June 19th (Appropriated $59 million) Energy Efficiency and Conservation Block GrantsEECBG funding is divided between state controlled funds (for the smallest municipalities) and local government funds. Only the State-controlled funds have been awarded. Local and country government applications are due August 10th. I couldn’t find information on the state-controlled portion for either of these states. Presumably, they have been awarded but I’m be sure.North Carolina - ??? (Appropriated $58 million)South Carolina - ??? (Appropriated $31 million)
South Carolina:Public Institution Energy Improvements: $40,000,000Issue grants and no-interest loans to public institutions for energy efficiency projectsReduce energy use by 1% per year for five years, with a goal of 20% reduction by 2020South Carolina Energy Efficiency Training Center Collaborative: $910,000Increase amount of energy-related training provided to the labor force of the stateSmall Business/Utility Partnership for Energy Efficiency Equipment: $50,000Ensure small business participation in market transformation accelerated by the ARRALow-Income Manufactured Housing Retrofit & Evaluation: $3,040,000Assess the efficacy of various energy conservation retrofits for low-income residents of manufactured housingWorks with South Carolina’s WAP, Technical College System, Department of Commerce Workforce Program, and the Central Electric Cooperative of South CarolinaGoals:Weatherize 200 homesProvide efficient roof retrofits on 200 homesRetrofit 200 homes with efficient heat pumps and install ENERGYSTAR appliance upgrades in 200 homesSophisticated power monitors installed in 400 homes to assess the energy efficiency value in residencesSouth Carolina Clean Green Investment Incentives $3,000,000Assist new or expanding industrial or commercial businesses which are creating new jobs and providing additional capital investment in the state. Encourages manufacturers of energy efficiency and renewable energy products to locate in South Carolina and helps such existing industries remain in the state and/or expand.Competitive Renewable Energy Grants Program $3,000,000Encourage the development of renewable energy in the state, with preference going to NPOs which are not eligible for funding through other stimulus programs.Applicants expected to show a minimum return on investment of 2.5 to
South Carolina:Public Institution Energy Improvements: $40,000,000Issue grants and no-interest loans to public institutions for energy efficiency projectsReduce energy use by 1% per year for five years, with a goal of 20% reduction by 2020South Carolina Energy Efficiency Training Center Collaborative: $910,000Increase amount of energy-related training provided to the labor force of the stateSmall Business/Utility Partnership for Energy Efficiency Equipment: $50,000Ensure small business participation in market transformation accelerated by the ARRALow-Income Manufactured Housing Retrofit & Evaluation: $3,040,000Assess the efficacy of various energy conservation retrofits for low-income residents of manufactured housingWorks with South Carolina’s WAP, Technical College System, Department of Commerce Workforce Program, and the Central Electric Cooperative of South CarolinaGoals:Weatherize 200 homesProvide efficient roof retrofits on 200 homesRetrofit 200 homes with efficient heat pumps and install ENERGYSTAR appliance upgrades in 200 homesSophisticated power monitors installed in 400 homes to assess the energy efficiency value in residencesSouth Carolina Clean Green Investment Incentives $3,000,000Assist new or expanding industrial or commercial businesses which are creating new jobs and providing additional capital investment in the state. Encourages manufacturers of energy efficiency and renewable energy products to locate in South Carolina and helps such existing industries remain in the state and/or expand.Competitive Renewable Energy Grants Program $3,000,000Encourage the development of renewable energy in the state, with preference going to NPOs which are not eligible for funding through other stimulus programs.North Carolina:Six focus areas for Recovery Act Funding:(from presentation of Larry Shirley, Director of State Energy Office, June 4, 2009)Support small business and industry through energy savings ($11.5 million)Identify and implement energy saving measures in small business and industryTarget “Main Street” communitiesCommercial renewable energy system grantsNonprofit energy management programGrow North Carolina’s green workforce- ($8.85 million)Continuing education for building code inspectorsWorkforce Development Initiative: Renewable energy, energy efficiency and alternative fuels, technology training, using community colleges, the UNC system, high school and early college programsFoster renewable energy technology and resource innovation ($13.5 million)Alternative fuels and biofuels development ($3.5 million): Partner with the NC Biofuels center and others to award competitive grants for promising biofuels and alternative fuels projectsNC Green Business Fund ($10 million): Competitive grants for innovative energy projectsImprove energy efficiency in local and state government ($9.5 million)Develop energy assessments and strategic energy plansIdentify new projects: 270 energy projects at state agencies, universities and community colleges can be deployed immediatelySeek more proposals from public schools, local governments, and state agenciesPromote residential energy efficiency and renewable energy ($10 million)Promote energy efficiency in new affordable housing ($3 million): “Energy Star” manufactured homes, new affordable housing unitsEnergy Audits and implementation for existing homes ($7 million): matching funds and other incentives to owners of existing homes for energy audits and implementation of efficiency and renewable energy measuresCreate an Energy Investment Revolving Loan Fund ($18 million)Low and/or no interest loans to support energy efficiency and renewable energy projectsEligible parties include small businesses, industry, non-profits, local government, public schools, community colleges, and state agencies and universitiesUp to $1 million with terms up to 20 years