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Environmentalists Split Over Popular Energy Bill

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Efficiency advocates and fossil-fuel lobbyists have teamed up to kill a key energy provision. What’s behind this uneasy alliance?

By Paula Melton

Projected Energy Savings from Shaheen-Portman (S. 761)

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How much is at stake with Shaheen-Portman? A lot, according to an analysis from the American Council on an Energy-Efficient Economy (ACEEE). The group projects an overall reduction in U.S. energy use of 15 quadrillion Btu between 2014 and 2030, about 9.5 of those from the bill as currently written, and claims that energy lost by repealing a key energy law will be gained back by other provisions of the new bill.

Source: ACEEE

The historic Shaheen-Portman energy bill making its way through the U.S. Senate enjoys rare and broad bipartisan backing, with the likes of Earthjustice and the Vinyl Siding Institute both announcing full-throated support. But the American Institute of Architects (AIA) and more than 350 other organizations have warned that they will fight Shaheen-Portman (a.k.a. the Energy Savings and Industrial Competitiveness Act of 2013) if a certain amendment is adopted.

Thanks in part to a handful of energy-efficiency advocates, that amendment may very well pass.

Repealing Section 433

The proposed amendment guts a hard-won provision of the 2007 Energy Independence and Security Act (EISA)—a few paragraphs in Section 433 targeting the eventual phase-out of fossil-fuel-generated energy in federal new construction and major renovations by 2030.

Dubbed “The All-of-the-Above Federal Building Energy Conservation Act of 2013” by its cosponsors John Hoeven (R–North Dakota) and Joe Manchin (D-West Virginia), the proposed amendment is currently under committee review as a standalone bill and has strong support from the American Gas Association (AGA). AGA has long claimed that Section 433 is flawed, and AIA has long fought these claims.

Although the Department of Energy (DOE) has tried to establish rules to move federal buildings toward the ultimate fossil-fuel phase-out, final action was never taken—in part due to resistance from fossil-fuel interests, but oil and gas companies have boosted their credibility by attracting the support of the Alliance to Save Energy and of efficiency-focused companies like Johnson Controls and Siemens.

EISA “is all about advancing efficiency in federal buildings, and we are all for that,” explains Paula Gant, vice president of regulatory affairs at AGA. “We feel strongly that natural gas is a part of that.” Gant also told EBN she felt that Section 433 was “enacted at a time when the country didn’t understand the natural gas resource,” and she makes the claim (disputed by 433 supporters) that the provision would prohibit the use of combined heat and power generation in federal buildings.

Back to the first fuel

The Hoeven-Manchin bill proposes three major changes to EISA.

First, it redefines “major renovation,” shifting away from a cost-based definition to one based on energy performance. A renovation (somewhat cyclically) wouldn’t be considered “major” unless it modified the building’s energy systems so much that “the whole building can meet energy standards for new buildings.” This change addresses a concern raised by AGA and its allies that major renovations of federal buildings would be put off because projects wouldn’t be able to meet the required 2030 targets.

Second, the proposal focuses on efficiency instead of fuels, requiring new construction and major renovations to be designed for a 30% reduction in energy use compared with current ASHRAE 90.1 or International Energy Conservation Code (IECC) standards. This change is agnostic on the source of the energy consumed, only calling for modeled reductions.

Third, it extends the timeline for reducing actual energy consumption in federal buildings, requiring a 45% decrease in energy use intensity (EUI) by 2020; in EISA Section 431, these targets stopped with a 30% reduction in 2015. This change sweetens the compromise deal for energy-efficiency advocates.

Net-zero impact on the bill?

“433, because of the way it’s structured, doesn’t really save much energy until 2025,” argues Steven Nadel of the American Council for an Energy-Efficient Economy (ACEEE). The group recently published an analysis of all the potential amendments to Shaheen-Portman, concluding that “as currently written, Section 433 is not workable” and that the Hoeven-Manchin amendment “would result in larger energy savings than repeal of Section 433 would lose.”

An accompanying chart shows “Repeal of 433” having virtually no effect on projected energy savings from the bill. Other amendments supported by ACEEE would add up to an estimated 6 quadrillion Btu in savings in this analysis.

Maybe not

In a newly released technical review, though, Architecture 2030 points out what it views as flaws in ACEEE’s analysis. First, says the group, the EUI reductions are likely to be extended beyond 2015 anyway. And second, claims the paper, tying modeled energy reductions to codes would not require the kind of deep fossil-fuel-energy cuts mandated by Section 433. That’s because prescriptive code requirements (on which performance-path compliance is based) are running out of ways to bump up energy performance significantly in a way that is reasonably cost-effective.

“Right now, our best energy codes—the 2012 IECC and ASHRAE 90.1–2010—have prescriptive requirements that are almost, but not quite, at their limit,” says Ed Mazria, FAIA, founder and CEO of Architecture 2030. “For example, there are still some gains to be made if we start requiring highly advanced lighting systems,” but otherwise, “the gains now in terms of code updates are going to be much, much smaller.”

EISA Section 433(a)

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These subparagraphs of Section 433 (a) of EISA are at the heart of a dispute between efficiency proponents who want to see an important new efficiency bill pass and those who would rather see more stringent energy rules remain in effect.

Screen capture: H.R. 6, Energy Independence and Security Act of 2007

Mazria gave the example of an existing building that’s due for a major energy retrofit in 2015. Under Section 433, that building would have to be designed to cut fossil-fuel consumption 65% compared with average national building performance in 2003. Under the Hoeven-Manchin plan, Mazria argues, the building would only have to be designed to reduce its consumption 57.5%. That gap between Section 433 and the Hoeven-Manchin proposal will continue to widen as time goes on because of the limitations of prescriptive codes, he claims.

433 and natural gas

Mazria also discounts the idea that Section 433 would eliminate fossil-fuel use in federal buildings, even after 2030. There is an industry-wide definition of what it means to be 100% fossil-fuel-free, he claimed. “It does not eliminate natural gas; it just means we’re putting as much renewable energy back into the grid as we bring in from off-site, resulting in no net emissions of greenhouse gases.” That interpretation, though, “should be taken care of in the rules when they are issued,” he argued—not by rewriting the law.

The natural gas industry isn’t so sure. According to government calculations, says Paula Gant, “we have over 100 years of natural gas resource in the ground that we know of. It’s a secure resource, we can produce it responsibly, and we can deliver it reliably.” Pointing to the fuel’s “very favorable greenhouse profile,” Gant said the law was “inartfully” written since it didn’t explicitly state that net-zero fossil-fuel use would be acceptable. “A lot of people can agree that this could have been done in a variety of ways that could have been workable,” she said.

Other options off the table

Many sources EBN spoke with suggest that AGA remains adamant, however, about completely removing the fuel-related provisions rather than revising the wording to be clearer.

Nadel at ACEEE readily concedes that “there are other potential solutions to these problems beyond repeal”—like using an existing loophole to allow for combined heat and power generation in DOE rulemaking—but he argues that a compromise with the fossil-fuel industry was necessary for the bill to move forward at all. “Some people are trying to thread a needle,” he told EBN.

The Natural Resources Defense Council (NRDC) has come under fire from other environmental groups for working with ACEEE and others to negotiate the amendment, but that group withdrew its support once it became clear that 433 repeal had to be part of the deal. “The Hoeven-Manchin amendment includes a lot of good stuff, some strong efficiency measures,” said NRDC’s Bob Keefe in a delicately worded explanation to EBN. “It also comes with repeal of Section 433. That’s not the approach we think is right, and it’s not the approach we’ve urged. We don’t support or oppose it, but we don’t think it’s the right way to go.”

Mazria expressed disappointment in ACEEE’s continued support of the amendment, saying the organization “is basically saying that the AGA can stop Shaheen-Portman if it does not include the repeal of Section 433, and that the entire building sector is powerless and can’t do anything about it.” He felt this was “a slap in the face” to an industry that has made such a deep commitment to the 2030 Challenge targets, adding, “The private sector is actually slightly ahead of meeting the 2030 targets. Repealing Section 433 would put the government way behind—not in a leadership role at all.”

Mazria may be right that AGA is up against some tough opponents. Supporters of Section 433 as written include not only major environmental groups and international architecture firms (including several large federal contractors) but also big industry players like the American Chemistry Council.

What about LEED?

Section 433 also requires the U.S. General Services Administration (GSA) to recommend a green building certification system for federal buildings—a process the agency is expected to complete this summer for the second time.

The Hoeven-Manchin amendment leaves the certification review untouched, but another rumored amendment, allegedly due out soon from the Senator Mary Landrieu (D-Louisiana), would alter that part of Section 433 with the aim of excluding LEED from federal government use.

A Landrieu staffer told EBN that details were not yet available because “the amendment is still being developed” but emphasized, “The goal is not to outlaw LEED. It is to ensure that any building efficiency standard used not discriminate against any one material.”

Comments (3)

1 Vinyl is big industry in Loui posted by Edward Gulick on 07/08/2013 at 02:06 pm

It would appear that the Vinyl Institute has Senator Landrieu wrapped around its finger.

2 Forestry and more posted by Paula Melton on 07/08/2013 at 02:24 pm

Yes, there are a lot of economic interests in play here. Forestry is also important in the Southeast, and gas drilling is key to the economy in both North Dakota and West Virginia.

3 Skanska Withdraws from U.S. C posted by Paula Melton on 07/09/2013 at 10:14 am

We've just received word from international construction firm Skanska that the company has dropped its membership in the U.S. Chamber of Commerce because of the trade group's anti-LEED stance. You may see more coverage of this soon.

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July 28, 2013