EFFICIENCY:

A tale of 2 ways to save electricity

Recent developments in efficiency policies are playing out in two different stories about how the low-hanging fruit gets picked: with business's blessing or its opposition.

In one story, there's been a truce. Manufacturers have agreed to new standards making air conditioners more efficient in hot regions and making heaters more efficient in cold ones.

In the other, there's a standoff. California state regulators will vote next month on a plan to drastically improve efficiency in energy-hungry televisions, but TV makers are protesting the policy as burdensome and unnecessary.

Both industries face a rising tide as more states begin to consider energy efficiency policies. States seek more than the direct benefits -- reduced emissions and energy bills -- they also want to prepare for federal legislation that could push efficiency even further.

The Air-Conditioning, Heating and Refrigeration Institute, which represents the main producers of furnaces and air conditioning systems, agreed to the deal after months of talks with pro-efficiency groups, including the Alliance to Save Energy and the American Council for an Energy-Efficient Economy (Greenwire, Oct. 13).

The regulatory stage had been set: The Obama administration is about to review a furnace standard set by the George W. Bush administration, and air conditioners are about to face new efficiency guidelines. Upcoming talks for the Montreal Protocol will likely bring new controls on hydrofluorocarbons, a main refrigerant and potent greenhouse gas.

For decades, manufacturers preferred a system that made mass production easy: Washington would set the efficiency standards, and states couldn't go above them. That gave manufacturers a large, uniform market.

A multi-region solution

But they took flak from environmentalists, who pointed out that since weather differs throughout the United States, using a single efficiency standard for all climates was leaving some energy savings stranded.

A stingy heater doesn't necessarily pay for itself in a hot climate. But in a cold climate, "buying something lower than that is a bad economic decision," said Lane Burt, an energy policy analyst at the Natural Resources Defense Council, which helped iron out the AHRI agreement.

Under the deal announced yesterday, AHRI will make its appliances for three broad U.S. regions: the North, South and Southwest. Manufacturers will make heaters more efficient in the Northern states and air-conditioners more efficient in the Southeast.

In the Southwest, defined as Arizona, California, Nevada and New Mexico, where the temperature often goes above 100 degrees, air conditioners will be rated not only by their efficiency under perfect conditions, but also when they're cranked up for the summer heat.

Dave Calabrese, AHRI's vice president of public policy, said the groups will share the proposal with Congress, where they hope to add it to climate legislation.

The deal made sense for manufacturers, which want a long-range forecast of what will be expected of them, so they can get started on technologies now, said Bob McDonough, president of residential and light commercial systems for Carrier, a major supplier in the field.

He said Carrier invests tens of millions in development and testing to meet rising efficiency standards. "Being able to look at the agreements that are being put in place here allows us to put a template in place for the next 10 years, really," he said.

It also gave manufacturers more control over the agreement than the Energy Department would have given, efficiency advocates pointed out.

"In short, they negotiated, because they wanted to control their regulatory destiny in a proactive way, rather than sit back and see what the current DOE might do," said Andrew deLaski, executive director of the Appliance Standards Awareness Project and another of the negotiators.

A dispute over flat-screen TVs in Calif.s

As a separate story in California shows, not every business interest wants to take that path.

Last month, the California Energy Commission released a draft rule aiming to cut new TVs' electricity use in half by 2013. The proposal targeted flat-screen LCD TVs, which consume more energy than typical units (E&ENews PM, Sept. 21).

Manufacturers of these TVs have opposed the proposal, saying they want consumer demand to guide efficiency levels. The Consumer Electronics Association (CEA) sponsored an April study finding that the standard would cost California $50 million in tax dollars and 4,600 jobs as consumers imported TVs from out of state.

The study said the standards would phase out 80 percent of current LCD TVs between 35 and 39 inches; all plasma screens over 60 inches would be outlawed.

In an e-mail, Jason Oxman, senior vice president of industry affairs for CEA, said "voluntary industry efforts are already ensuring the widespread availability of energy-efficient televisions from which consumers can choose."

DeLaski disputed that the industry could be counted on to improve efficiency all on its own.

TVs that 'guzzle' more power than a refrigerator

"If we could count on industry altruism and the market to provide efficiency, then we wouldn't have TVs in use today that guzzle more power than a refrigerator," he said.

Most TV buyers don't consider energy in their top two to three concerns while shopping, he said.

"That's why we need standards -- to assure a basic level of efficiency performance for all consumers as they choose the TV set based on the criteria that matter most to them," he said.

While some lobby for tougher standards to make buildings and appliances more efficient, others say even these don't work quickly enough.

In the coming months, a research team at the Colorado-based think tank Rocky Mountain Institute (RMI) will examine state efforts on efficiency, in the hopes of finding out what policies work best.

Some states drive efficiency through the utilities, while others stress incentive programs, such as tax breaks on energy-efficient appliances.

Building codes and appliance standards can improve efficiency in the longer term, said Natalie Mims, a consultant who will be a lead researcher on the project, called "Closing the Efficiency Gap."

"I don't think that they're going to be sufficient in the 2020 time frame," she said.

The issue has to do with turnover, she said: Codes and standards affect new buildings and appliances -- not the old, energy-greedy ones that have been around for years.

In the shorter term, she said, states are exploring retrofit programs that get at these anchors of energy waste. The RMI project will aim to find how states are getting past the barriers that keep already logical investments from taking place.

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