Forecast from Capitol Hill: Dry Spell for Energy Efficiency?

Last year, the Trump administration announced a federal budget proposal recommending a 31% cut in funding for the Environmental Protection Agency (EPA), jeopardizing successful programs like ENERGY STAR. Seemingly spared the chopping block for the remainder of 2017, its fate was threatened again when the fiscal year ended on September 30th. Though the ENERGY STAR program was preserved, the House of Representatives passed an appropriations package slashing its 2018 funding to $31 million, a 53% reduction from 2017’s funding of $66 million.

As if the future of ENERGY STAR wasn’t uncertain enough, the House Energy and Commerce Sub-Committee held a hearing in November, reviewing the Energy Star Reform Act which proposed transferring the program to the Department of Energy (DOE). Possible outcomes included the creation of liability requirements for manufacturers and other program participants, and allowing manufacturers to self-certify their own products without requiring independent third-party certification, potentially undermining ENERGY STAR’s reputation as a trustworthy, unbiased consumer resource.

On February 12th, the administration’s 2019 budget proposal revealed what appears to be increasing support for fossil fuels at the expense of environmental and renewable energy initiatives. The draft allocates $6.14 billion budget for EPA (a reduction of nearly $2 billion, or 24%, from current funding levels), cutting EPA employment from 15,416 to 12,250, and instituting fees for companies that wish to take part in the ENERGY STAR’s appliance efficiency program. Unable to escape unscathed, the proposal also suggests slashing the Department of Energy’s Office of Energy Efficiency and Renewable Energy (EERE) budget by $1.3 billion, or 65%. In contrast, the Office of Fossil Energy would receive a 20% budgetary increase.

This “same song different verse” discussion reminded us to step back and consider the potential ramifications of these ongoing budget conflicts around ENERGY STAR and other programs.

To help us answer that question, we review many of the points we made in our earlier ENERGY STAR white paper:

  • Commercial buildings and plants account for nearly half the country’s energy use and generate substantial emissions.
  • 450,000+ commercial buildings are benchmarked with ENERGY STAR
  • Industry participants like BOMA, NAREIT and others signed a letter estimating that more than 2 million jobs are created via energy efficiency programs, including ENERGY STAR
  • Several studies show that energy efficient buildings, including ENERGY STAR certified facilities, may generate higher rents, higher occupancy rates, increased sales prices, and stronger risk-mitigation.
  • ENERGY STAR certified products helped consumers save $23 billion in energy costs in 2015

Energy efficiency and ENERGY STAR are important to industry professionals as well. Our recent survey on ENERGY STAR had more than 400 building professional respondents from around the US. We found strong, non-partisan support, with industry groups and leaders making unequivocal statements touting the benefits.

  • 78% would be concerned if ENERGY STAR funding was reduced/removed
  • 75% unfamiliar with benchmarking tools aside from ENERGY STAR
  • 64% reported Portfolio Manager usage
  • 61% required to benchmark their facility/portfolio's consumption

States and cities also agree on its significance: as demonstrated by progress made at the state and local level. As of September 2017, 29 cities nationwide adopted building energy benchmarking and transparency regulations, and regard Portfolio Manager as integral to achieving their individual goals.

Unfortunately, no viable alternatives to Portfolio Manager exist, and a reduction or loss in funding for ENERGY STAR may result in detrimental consequences to many of these ordinances as well as potential losses in energy savings, job creation, energy independence, and more.

With unrelenting threats to funding renewable energy technologies and valuable energy efficiency programs like ENERGY STAR, numerous stakeholders – including policymakers, building professionals, and industry groups ­– may have to consider what an ENERGY STAR “dry spell” could mean for them.