Energy Efficiency Means Business 2021

The Environmental and Energy Study Institute (EESI) held a briefing with experts about how federal energy efficiency programs create jobs and deliver direct meaningful savings to constituent homeowners, consumers, and businesses—all while reducing the stresses and strains on our energy system. Making investments in energy efficiency also encourages productive public-private partnerships and collaboration, improves the sustainability and resilience of our communities, and contributes to meaningful, near-term reductions in pollution and greenhouse gas emissions.

HIGHLIGHTS

Rep. Marcy Kaptur (D-Ohio)

• According to Environmental Entrepreneurs (E2), there were 3.3 million jobs in clean energy at the beginning of 2020, including over 2.3 million jobs in energy efficiency.
• The Department of Energy Building Technologies Office programs and the Weatherization Assistance Program offer a window into how the energy efficiency economy can help meet our nation’s 21st century challenges.
• Rep. Kaptur’s goal as Chair of the Energy and Water Appropriations Subcommittee is to help our generation ensure a better future for those who follow. We will build back a better future superior to today’s and produce new, good-paying jobs while we are at it.

Rep. Jeff Fortenberry (R-Neb.)

• As we rethink the architecture of the 21st century—politically and economically—it is important that we consider that we need to begin a transition to a sustainable source of energy in the future. Conservation, efficiency, and innovation are part of this.
• Rep. Fortenberry has long been a supporter of transitioning to a sustainable energy economy, making sure to do this in stages so we are not disruptive. This is an exciting vision because, ultimately, it is about the stewardship of the resources we have.

Vicki Hackett, Deputy Commissioner of Energy, Connecticut Department of Energy and Environmental Protection (DEEP)

• The U.S. State Energy Program (SEP) provides Connecticut and all other states with tools to deliver energy savings, improve the resilience and sustainability of communities, reduce air pollution, create jobs, and help achieve energy, climate, and resilience goals. SEP is the only cost-share program administered by the Department of Energy that provides resources directly to states. Each SEP dollar leverages $10.71 of non-federal funds and produces annual energy savings of 1.03 million source BTUs and cost savings of $7.22.
• The Conservation and Load Management Program (C&LM) uses SEP funds to provide significant energy and cost savings to residents and businesses. The portfolio of C&LM programs reduces emissions from fossil fuel companies, addressing climate, public health, and environmental justice concerns. C&LM programs also add to the gross state product, generate tax revenue, and support thousands of good jobs across the state.
• Many ongoing projects in Connecticut use the SEP, including planning EV infrastructure, addressing health and safety barriers to weatherization, and supporting energy affordability through the Home Energy Score. The Connecticut Department of Energy and Environmental Protection (DEEP) uses a web-based software program called EnergyCAP, supported by SEP funds, to track utility use and cost in state buildings, which helped to achieve over $12 million (8 percent) in energy savings.
• Health and safety barriers to weatherization, such as asbestos, mold, and lead paint, affect Connecticut and states with similarly old housing stock. In 2019, 23 percent of income-eligible households were prevented from being weatherized due to barriers. DEEP uses SEP and additional funding sources to overcome these barriers.
• Roughly 80 percent of clean energy jobs in Connecticut are in the energy efficiency sector, which supported 36,000 jobs statewide in 2019. However, Connecticut’s energy efficiency workforce suffered great losses due to the COVID-19 pandemic. DEEP worked closely with utility companies and energy efficiency contractors to rebuild the workforce around energy efficiency.
• Connecticut is eager to continue work related to the SEP and Weatherization Assistance Program (WAP) and urges Congress to fund the U.S. SEP at $90 million for fiscal year 2022 annual appropriations and to fund the WAP at $360 million. DEEP supports the National Association of State Energy Officials’ (NASEO) SEP funding request for $3.1 billion under a stimulus or infrastructure package.

Christopher Hess, Vice President, Eaton

• The pandemic has given us a sense of how critical supply chains, power management, and workforce health are to our economy and communities. Eaton is positioning itself to address a lot of these issues related to climate change because we see tremendous growth opportunities to provide solutions in this area. Eaton is providing intelligent power management solutions to homes, vehicles, facilities, etc...
• The Department of Energy (DOE) Office of Energy Efficiency & Renewable Energy (EERE) is making important investments in energy efficiency, resilience, and jobs, and the office enables unique partnerships across the public and private sectors. EERE, along with other DOE offices, is also crucial to demonstrating the effectiveness of technologies by piloting them. This pulls those technologies to mature industries by boosting consumer and investor confidence.
• Eaton has partnered with several labs in the DOE portfolio to bring products from the lab setting to the market. DOE investments in these labs will be key to ensuring the United States will continue to lead the global development of energy-efficiency technologies. For example, Eaton’s partnership with the National Renewable Energy Laboratory (NREL) has been a key partnership for the past four years. NREL helps Eaton to develop energy integration systems that are deployed in data centers, facilities, and mission-critical environments.
• Eaton’s focus on cross-cutting technologies, vehicles, aerospace, and electrical grid resilience are areas of interest to accelerate the energy transition. Electrical and microgrid deployment opportunities are enormous, and Eaton is working towards these ends.

Arjun Krishnaswami, Policy Analyst, Climate & Clean Energy Program, Natural Resources Defense Council (NRDC)

• Federal investments have helped drive clean energy growth. The cost of some of our major clean energy solutions has dramatically declined over the past decade. Distributed solar has declined by about 60 percent and wind has declined by nearly 90 percent. In part, this is attributable to decades of investment from DOE as well as tax incentives and other federal and state policies.
• Each dollar invested through EERE programs resulted in $33 dollars in benefit to the United States, according to independent, peer-reviewed evaluations. DOE HVAC, water heating, and appliance R&D investments resulted in $20-66 of benefits per dollar invested. WAP supports 8,500 jobs in a typical year and saves the average household almost $300 per year.
• DOE programs are underfunded relative to need. If DOE’s clean energy budget had increased with inflation, it would be $32 billion instead of $9 billion today. Existing programs could support far more qualified applicants. Deployment and equity programs are especially underfunded: at current funding, WAP will only retrofit 150,000 homes over four years out of 40 million eligible ones. States and cities are critical to addressing the climate crisis but are often limited by funding. DOE can help expand local and state efforts with a greater budget.
• DOE clean energy programs are particularly underfunded for buildings, industry, and transportation—all areas where energy efficiency is a core solution. Greater funding for energy efficiency and efficient electrification is needed to reduce carbon emissions and advance other goals such as environmental justice and energy justice and equity.
• The time is ripe for significant expansion of the DOE budget. We need to achieve a $400 billion investment over 10 years. There is a major opportunity for both stimulus funding and expansion of DOE’s budget to provide long-term, consistent support to bring the benefits of energy efficiency and clean energy to more people. EERE—and in particular the buildings, industry, and transportation offices—needs a much larger annual budget to take advantage of the opportunities. There is also a need for funding for equity, justice, and workforce development in the DOE budget.

Jennifer Schafer-Soderman, Executive Director, Federal Performance Contracting Coalition (FPPC)

• Performance contracting is a significant dimension of federal efforts around energy efficiency and renewables integration. This is an alternative contracting mechanism with the federal government where energy service companies (ESCOs) design, build, and fund energy efficiency upgrades to infrastructure up front and are paid back through guaranteed energy savings from utility bill reductions. Performance contracting and other federal energy program (FEP) services are expanding because agencies have a lot more requirements, including installing renewables, building resilience, incorporating microgrids, achieving net-zero emissions, and improving cybersecurity.
• The Federal Performance Contracting Coalition’s (FPCC) appropriations requests are informed in part by the Energy Policy Act of 2020, which authorizes the Federal Energy Management Program (FEMP) at $36 million per year for the base program. The FPCC is also requesting that the federal government provide an additional $20 million for the Assisting Federal Facilities with Energy Conservation Technologies (AFFECT) Grant Program, as well as stimulus money for federal agencies to conduct clean energy projects and leverage private sector finances to raise more funds.
• The FPCC has other agency requests:
  • Ensuring appropriate implementation funding is available for the military, General Services Administration (GSA), and the Department of Veterans Affairs.
  • Advocating for $20 million to the Department of Defense for a pilot program similar to the AFFECT Grant Program.
• Retrofitting projects in large buildings create about 9.5 jobs per million dollars of investment and direct funding of $5 billion of federal investment creates 47,500 jobs. Funding with performance contracting creates 237,000-500,000 jobs with the same investment. Similarly, $7.5 billion of private sector funds raised by performance contracting has worked to reduce carbon emissions by 7 billion pounds annually.

Curtis J. Zimmermann, Ph.D., J.D, Manager, Government Liaison, BASF Corporation

• BASF is the largest chemical company in the world, with about 115,000 employees and 18,000 of those jobs located in North America. The corporation’s global sales for 2020 were about $71.5 billion and about $16.4 billion in North America.
• BASF has close to 150 production and research and development sites across North America, a few of which are verbund sites, or systems that use waste produced from manufacturing as key raw materials for future manufacturing.
• Critical DOE programs supported by BASF include the Advanced Research Projects Agency-Energy (ARPA-E), which highlights transformational energy technologies and helps demonstrate proof of concept in order to advance technological development beyond the valley of death and into the marketplace. ARPA-E and the Energy Innovation Summit offer potential collaborative opportunities for individuals in the energy landscape and will continue to help the United States lead in energy technology innovation globally.
• Energy storage, plastics innovation, and hydrogen are other critical areas for DOE investment.
• Other DOE programs impacting the built environment include the Building Energy Codes Program (run by the Building Technologies Office), which provides technical and financial assistance to states and localities to adopt and implement energy codes. The Building America Program leverages building science expertise, innovation, and applied research for high performance homes with emphasis on efficiency to benefit the residential sector.

Q&A Session

Much of Schafer-Soderman's presentation focused on the Federal Energy Management Program. How does the performance contracting industry work outside of the federal government, namely at the state and local levels?

• Schafer-Soderman: There is a whole performance contracting market outside of the federal market: state, local, schools, hospitals, municipalities, etc. The federal market is about a billion dollars a year, while the state and local markets are about six billion dollars a year, even though some states do not use performance contracting. There have been signals in the Administration's Build Back Better plans and the CLEAN Future Act to leverage performance contracting at the state and local levels.

Highlights compiled by Hamzah Jhaveri