Dems bristle at regulatory reforms in efficiency legislation

By Nick Juliano, Katherine Ling | 05/01/2015 06:56 AM EDT

Energy efficiency is widely popular, but some provisions Republicans hope to include in a broad energy bill aimed at dialing back some existing policies ran into sharp objections from House Democrats yesterday.

Updated at 9:16 a.m. EDT.

Energy efficiency is widely popular, but some provisions Republicans hope to include in a broad energy bill aimed at dialing back some existing policies ran into sharp objections from House Democrats yesterday.

The emerging energy bill continued to take shape yesterday in a pair of hearings on either side of the Capitol focused on various legislative proposals that eventually could become its efficiency title. Senate Energy and Natural Resources and House Energy and Commerce panels convened separate hearings around the same time yesterday morning.


Most of the draft efficiency bill that House Energy and Commerce members were considering yesterday had bipartisan support. But Democrats emphasized objections to provisions that would delay an efficiency standard for home furnaces, reverse a directive for the federal government to cut its fossil fuel use and limit the federal government’s influence over third-party building codes.

"As this efficiency title is currently constituted, I would not be in a position to support it or to recommend that others support it," said Rep. Frank Pallone (D-N.J.), the full committee’s ranking member, during a hearing yesterday of the Subcommittee on Energy and Power, which addressed the efficiency bills and a separate energy bill proposal that would require a study of the Strategic Petroleum Reserve.

Still, Pallone and other Democrats acknowledged that it is still early in the process and expressed a willingness to try to find a compromise on efficiency.

The most visible disagreement at yesterday’s House hearing came over DOE’s recently proposed furnace rule, which has drawn the ire of gas utilities, manufacturers and home builders, among others. They say its requirements would be especially burdensome in the South and could force homeowners facing the need to replace an old gas furnace to switch to a less expensive electric furnace that would produce more carbon emissions.

Language in the draft bill would send DOE back to the drawing table to come up with a new rule. That is opposed by Democrats and efficiency advocates, who say they understand the concerns with the rule but would prefer a more targeted solution that narrowly addressed legitimate cost concerns without sacrificing efficiency gains. The efficiency standard has essentially not been revised since 1987, although a 2007 update is scheduled to go into effect later this year. Litigation has forced DOE to go back to the drawing board twice since then, leading to the proposal released earlier this year.

Reps. Mike Doyle (D-Pa.) and Peter Welch (D-Vt.) emerged as key potential dealmakers in the negotiations during yesterday’s hearing.

Doyle noted that there is very little new construction in his Pittsburgh-area district, which features mostly row houses built nearly a century ago occupied by a large number of senior citizens. Doyle worried about the costs to replace an old "noncondensing" furnace that would be outlawed by the rule with a new "condensing" unit, a process that could require additional venting that is expensive to install in old structures. He said he is fine with requiring the more efficient furnaces in new homes but would like to address concerns over retrofits.

"The fear is it’s going to drive people to consider something else if the cost is too much" to replace a gas furnace in an old home, Doyle said in a brief interview after the hearing.

Several Democrats also targeted language in the House draft to kill Section 433 of the 2007 Energy Independence and Security Act, which requires the federal government to eliminate its use of fossil energy in all-new and substantially renovated buildings by 2030.

The House language did not include a provision included in Senate legislation from Sen. John Hoeven (R-N.D.) to strengthen expiring efficiency targets in exchange for eliminating the fossil fuel phaseout, but several industries said they would support that compromise, indicating it would likely be part of the final product.

There also was sharp disagreement over language in the House bill inserted by Reps. Marsha Blackburn (R-Tenn.) and Kurt Schrader (D-Ore.) that would prevent DOE from advocating for particular technologies when it offers advice to independent organizations that set building codes and would require any DOE-endorsed standard to be cost-effective within a decade. It is a more industry-friendly provision than language advanced by Welch and Rep. David McKinley (R-W.Va.) aimed at making standards more cost effective but not limiting DOE’s advocacy that is supported by efficiency advocates.


At the Senate Energy and Natural Resources Committee hearing examining 22 efficiency bills, Chairwoman Lisa Murkowski (R-Alaska) and several of her colleagues also pressed the issue of the "efficiency" of energy programs — cutting back the burdens imposed by the federal government in trying to achieve those reductions.

Energy efficiency will be one of four titles in a comprehensive energy bill Murkowski aims to pass this year and is considered an area where there is a great deal of bipartisan, bicameral support. But as important as efforts to boost energy efficiency are, Murkowski said it is also key to understand "what is happening out there with agency oversight; knowing what we have and using it to our advantage … to ensure what we do have out there makes sense."

Streamlining the programs and regulations in place also ties into a fourth title planned for the comprehensive bill on "accountability," Murkowski said.

"I think this is part of our required review not only of the 22 energy efficiency bills but how do we bring about efficiency within our processes so we make sure our programs are working properly," she said.

Along those lines, Murkowski raised concerns about the possibility of duplicating or burdening a state’s own initiative if there is a national energy efficiency resource standard, as promoted in a bill from Sen. Al Franken (D-Minn.), S. 1063.

Her colleagues Hoeven and Sen. Jeff Flake (R-Ariz.) similarly pressed their provisions on lifting overly burdensome energy efficiency regulation and duplicative programs on fossil fuel phaseouts, S. 869; gas furnace standards, S. 1029; and green building programs, S. 939 (E&E Daily, April 29).

Kathleen Hogan, DOE’s deputy assistant secretary for energy efficiency, said many of these programs, and certainly those at DOE, were complimentary and not duplicative.

"I think I can speak quite well to how well and how committed we are to make sure these are effectively coordinated and supporting the mission of doing what they are supposed to do," Hogan told the committee. "Through R&D, deployment, and collaborations at all levels of government and the private sector, the Department of Energy aims to capitalize on the opportunities that energy efficiency affords."

While DOE supported the "underlying goals" of several of the energy efficiency bills, including S. 720 — the latest version of the long-standing Shaheen-Portman bill — and S. 858 — to promote the use of energy-savings performance contracts and utility energy service contracts — the agency is still reviewing details and did not take a position on any of the bills, Hogan said.

Democratic members of the committee chose to focus on the provisions to expand energy efficiency during the hearing.

Franken stressed that his energy efficiency resource standard measure would cut three times more carbon emissions as compared to the Shaheen-Portman bill and together they would remove emissions equivalent to taking 88 million cars off the road, according to a preliminary analysis by the American Council for an Energy Efficient Economy.

Ranking member Maria Cantwell (D-Wash.) also refrained from comment about the discussion of regulation reform and streamlining for now.

"I think today was a love-fest about energy efficiency, and so we are not trying to squelch that and definitely want to get to things that will promote further deployment," she said after the hearing.