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The Triumph Of Energy Efficiency: Waxman-Markey Could Save $3,900 Per Household And Create 650,000 Jobs By 2030
Joe Romm, 10 Jun 09


The energy efficiency provisions in the House energy and climate bill (H.R. 2454) could save $750 per household by 2020 and $3,900 per household by 2030, according to an analysis by the American Council for an Energy-Efficient Economy (ACEEE). An ACEEE news release notes that not only will efficiency reduce the costs to consumers and businesses of cutting carbon pollution:

ACEEE estimates that approximately 250,000 jobs will be created by the energy efficiency provisions in H.R. 2454 by 2020, with a total of 650,000 jobs generated by 2030.

The bill’s authors clearly understood that Energy efficiency is THE core climate solution – the biggest and lowest cost carbon-free resource by far.

The ACEEE agrees with CP and major environmental groups that a key improvement for progressives to pursue would be to “require utilities to reduce electricity demand by 10 percent by 2020″ (as opposed to the 5% to 8% the bill allows), which would result in an extra $50 billion in cumulative consumer savings by 2030—savings that Waxman-Markey is leaving on the table.

The bill has a remarkable number of energy-saving provisions [click to enlarge].

Here is ACEEE’s discussion of the key efficiency provisions of the bill (and go to their original analysis for a detailed spreadsheet of the electricity, natural gas, and CO2 savings of each provision):

The bill includes a number of key policies designed to maximize savings from energy efficiency, including improved building codes, appliance and lighting standards, and residential and commercial retrofits.

Allocations detailed in Section 782g direct 9.5% of allowances in 2012 (and decreasing amounts thereafter) to go into a State Energy and Environmental Development (SEED) account to be used by state and local governments for efficiency and renewables projects. The allocations to the SEED account will provide the funding for the REEP (Retrofit for Energy and Environmental Performance) program, transportation planning, building labeling, and other important energy-efficiency measures. At least 20% of the SEED money must go to funding renewable energy programs. Because the exact allocation of the SEED money will be the choice of local and state authorities, anywhere from 20-80% of the SEED money could go to energy-efficiency measures. Our analysis assumes that 75% will go to energy efficiency, providing savings as high as 2.45 quadrillion Btu’s in 2020 and 4.85 quads in 2030 (the average U.S. state uses about 2 quads/year).

Free allowances are given to natural gas utilities beginning in 2016 (Section 782b), one-third of which must be used specifically for energy efficiency. The allowances to efficiency will begin at 3% in 2016 and will ramp down over time. This could provide as much as 0.61 quads of savings in 2020 and 1.59 quads of savings in 2030. In addition, states will receive allowances based upon heating oil consumption (Section 782c), one-half of which must be used for energy efficiency programs. These allowances will be worth 1.875% of the total in 2012, ramping down to .03% in 2029.

The allowances will also be used to fund a number of other important energy efficiency programs, many of which will provide considerable monetary and energy savings for consumers. Section 201 directs 0.5% of the total emissions allowances to go to the implementation of stricter building codes. These codes will provide for 30% improvements in 2010, 50% improvements in 2014 for residential and 2015 for commercial buildings, and 5% additional improvements every 3 years after 2017/2018. Building codes are one of the most significant portions of the legislation, providing 9% of the savings from the bill in 2020, and 13% of the savings in 2030.

See “Better buildings soon? Energy and climate bill would set national energy codes.”

In addition, 1.5 % of the total allowances will be used to fund clean energy innovation centers (Section 171), which will conduct R&D on eight different categories of clean energy, including building efficiency and transportation efficiency. These will be administered by the Department of Energy, and the R &D innovations created by the centers are likely to save as much as 3 quads in 2030.

The savings Waxman-Markey could achieve are huge:

In total, the energy efficiency provisions in H.R. 2454 could reduce U.S. energy use by 4.4 quadrillion Btu’s, which accounts for about 4 percent of projected U.S. energy use in 2020. These energy efficiency savings are more than the annual energy use of 47 of the 50 states, including New York State. Moreover, such savings will avoid about 293 million metric tons of carbon dioxide emissions in 2020, the equivalent of taking 49 million cars off the road for a year. By 2030, these energy efficiency savings grow to 11 quadrillion Btu’s, accounting for about 10 percent of projected U.S. energy use that year.

Imagine what the savings could be if we can improve the efficiency provisions in the bill.

This piece originally appeared in Climate Change.

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I think it would be great. Look at the current tax credits available. Take geothermal heat pumps for example. The goverment tax credits have made sales of the heat pumps go crazy recently.

Posted by: Joseph on 22 Jun 09

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