Energy Efficiency’s Political Capital: How Should it be Used Next?

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Former Colorado Gov. Bill Ritter

Former Colorado Gov. Bill Ritter

Never has energy efficiency enjoyed as much political capital as in recent years. And the industry can probably bank on at least three more years of such clout – the remainder of Barack Obama’s presidential term.

How best might that time be used in framing public policy?

Led by former Colorado Gov. Bill Ritter, a group of influential energy insiders recently offered Obama 200 specific suggestions – on not just efficiency, but a broad range of energy topics. The recommendations are detailed in a report by the Center for the New Energy Economy (CNEE) at Colorado State University.

Called “Powering Forward: Presidential and Executive Agency Actions to Drive Clean Energy in America,” the report urges Obama to pursue a series of initiatives on the executive level that do not require action by today’s deadlocked Congress.

These are not minor administrative tweaks. As the report points out, the President holds formidable market influence when it comes to energy – he is “CEO of America’s biggest energy customer and Commander in Chief of the world’s most powerful military.” But most important, the President has a unique relationship with the American people, as the only public official elected by all American voters. And it’s this  relationship that he needs to leverage now, according to the report.

“Recognizing that their first responsibility was to protect the rights and interests of the public, including the resources the American people hold in common, several past presidents decided that when Congress failed to act, the chief executive had an obligation to do so. When they believed a national situation warranted action, some past presidents interpreted their authority broadly and exercised it aggressively,” the report says. “That is the practice of presidential authority America and the world need today.”

The report drills down to very specific fixes for several of the problems hampering clean energy. Recommendations include:

  • Through IRS tax code interpretations, allow clean energy projects to participate in Real Estate Investments Trusts and Master Limited Partnerships. This is meant to give clean energy parity with fossil fuels in the tax code. (Legislation before Congress would do the same, but its fate remains uncertain.)
  • Use federal assets – more than 10,000 buildings owned or leased – as leverage to expand the energy efficiency market. Require that federal agencies execute $1 billion in energy saving contracts in each of the next five years and use performance contracts more widely for public housing, demand response, data center consolidations, combined heat and power systems, and waste-to-energy projects.
  • Let utilities earn credit for energy efficiency investments to meet the Environmental Protection Agency’s greenhouse gas regulations.
  • Incorporate the benefits of energy efficient homes in mortgage underwriting, lending and appraisal guidelines.
  • Order the Office of Management and Budget to meet its own deadlines in reviewing new appliance efficiency standards.
  • Develop a model national code for net-zero energy buildings.

How the report came to be underscores its importance. William Becker, executive director of the Presidential Climate Action Project, tells the story in a recent Huffington Post blog. Gov. Ritter was one of 14 people invited to the White House in March for an energy discussion with Obama and his team. Ritter was called out of the room briefly and returned to find out that the group had elected him to lead research into the concerns of energy thought leaders.

The project now finished, Ritter announced the findings last week in Washington, D.C., joined by three energy notables: Heather Zichal, Obama’s former chief energy advisor;  Dan Esty, Connecticut’s outgoing energy commissioner and a Yale University professor; and Sue Tierney, managing principal of the Analysis Group.

The report reflects the thinking of 100 experts from business, academia, research, government and advocacy. Participants were allowed to remain anonymous so that they would openly express their thoughts.

“There’s no question that consumers are demanding access to cleaner, more efficient power,” said Alex Laskey,  Opower’s president and one of the experts tapped for the report. “This report outlines recommendations that would enable the federal government to lead America on a path to doubling our energy productivity while dramatically increasing innovation across the country.”

The full report is here.

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Elisa Wood About Elisa Wood

Elisa Wood is the chief editor of MicrogridKnowledge.com. She has been writing about energy for more than two decades for top industry publications. Her work also has been picked up by CNN, the New York Times, Reuters, the Wall Street Journal Online and the Washington Post.

Comments

  1. Among the current options the administration has open to it, in my judgment the greatest leverage lies in EPA’s upcoming CO2 rule for existing powerplants. EPA has received lots of comments supporting this approach. The analysis done to date shows that, as in other emission reduction policy frames, efficiency shows up as the least-cost option for achieving reduction targets. There are, to be sure, some important nuances on how efficiency plays into any given policy design. The crux of the issue, however, is how much legal leeway EPA’s counsel decides the agency can exercise within its existing Clean Air Act authority. Hopefully the minds will meet in ways that allow efficiency to deliver the value it can provide in this space.

    • All I’m saying is that efficiency is a virtuous cause, and for that matter hopefully it can be kept out of government rent seeking and actually do its job in aiding innovation. The beautiful thing about it is, a watt saved is 4 carbon footprints offset when taken all the way back to the power plant.

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