The legislation includes portions of S.1000, the Energy Savings and Industrial Competitiveness Act, and S. 398, the Implementation of National Consensus Appliance Agreements Act (INCAAA). Both bills have awaited Congressional action for several years, as S. 1000 was first proposed by Sens. Jeanne Shaheen, D-N.H., and Rob Portman, R-Ohio, in May 2011; and S. 398 was introduced by Sens. Jeff Bingaman, D-N.M., and Lisa Murkowski, R-Alaska, in February 2011.

Before being implemented into law, H.R. 4850 must pass the Republican-controlled House of Representatives. House members are expected to review the legislation during the post-election lame-duck session.

Sen. Bingaman’s Contributions

H.R. 4850 contains numerous regulatory relief measures for manufacturers, courtesy of Sen. Bingaman’s INCAAA.

The underlying bill, H.R. 4850, allows for energy standards exemptions for walk-in cooler and freezer component manufacturers demonstrating energy use equal to or less than existing standards; the INCAAA related portion establishes corrected federal standards for service-over-the-counter, self-contained, medium-temperature commercial refrigerators; and appropriate efficiency standards for small-duct high-velocity central air conditioners and heat pump systems.

The bill also requires that the Department of Energy (DOE) review commercial equipment every six years, regardless when it was manufactured, and mandates that DOE officials respond to all petition amendment requests within 180 days. If it is decided that a final standard be pursued, it must be completed within three years of the project’s implementation.

The U.S. Senate Committee on Energy and Natural Resources believes the Bingaman amendments could cut 12 percent of the nation’s electrical demand by 2030.

“This bill will reduce regulatory burdens on manufacturers and save energy by continuing DOE’s collaboration among industry, consumer, and energy efficiency advocacy groups on appliance, industrial, and federal-agency efficiency,” said Bingaman. “The programs strengthened by these amendments reduce the energy costs for American households and businesses, freeing those savings for other uses. And they strengthen electric grid reliability and protect our environment by reducing the impacts of increased energy production and use. I am heartened to see the continued bipartisan commitment to energy efficiency that is demonstrated by the passage of H.R. 4850.”

Shaheen-Portman Revisions

Numerous amendments, focusing on industrial and federal agency energy efficiency, were added from Sens. Shaheen and Portman’s Energy Savings and Industrial Competitiveness Act.

The S.1000 inclusions would establish a collaborative research and development partnership between the DOE’s Industrial Technologies program, and other departments, to promote early-stage energy efficiency. An industrial technologies steering committee would be formed to provide pertinent recommendations.

The DOE would also be required to conduct a study examining barriers restricting the deployment of energy-efficient technologies in the industrial sector. The study would consider the economic benefits of federal matching grants of $5 million over five- and 10-year periods.

The National Academy of Scientists would be tasked with analyzing the history, current trends, and opportunities for improvements in the supply chain.

“We were very pleased to see the Senate recognize the economic and environmental impacts of our bipartisan energy-efficiency bill by passing these important industrial and federal agency efficiency provisions,” Shaheen said, in a press release. “Energy efficiency is the fastest, cheapest way to start addressing our needs. We will continue to push to get the entire bill passed in the Senate so that our country can continue to save money by reducing energy usage.”

The amended bill would allow the General Services Administration access to appropriated funding to update federal agency building designs to meet updated energy efficiency standards.

Federal agencies would also be required to create implementation plans, updated annually, describing how they intend to achieve metering requirements per the National Energy Conservation Policy Act (NECPA). Facilities covered under section 543(f) of the NECPA would be required to use web-based tracking systems to publish energy- and water-consumption data.

DOE, along with program and facility managers, would conduct a feasibility study on data centers, with the intention of closing a minimum of 800 federal data centers by 2015.

Partisan Omissions

While Sens. Bingaman, Shaheen, and Portman celebrate H.R. 4850 as a whole, several portions of their measures were excluded.

The Senate-passed bill stresses government and industry collaboration, while wiping aside original language that called for more stringent national energy regulations in new residential and commercial buildings. The final submission dismisses a proposed DOE loan guarantee that would have fronted retrofit manufacturing efficiency improvements.

The elimination of the more stringent regulations, and omission of any new spending, may provide the bill a better chance of passing a Republican-led House.

“I am happy that this bipartisan effort to make our economy more efficient and competitive has passed the Senate,” Portman said. “Our amendment, while not everything we wanted, takes some reasonable and commonsense steps to ensure the federal government is coordinating with industrial manufacturers in developing and deploying industrial efficiency technologies, and places additional energy-efficiency requirements on the federal government that will ultimately save money for the U.S. taxpayer.”

Industry Reaction

A number of industry experts lauded the Senate’s bipartisan support of a bill they believe will deliver an immediate impact and a long-lasting legacy.

“Senators Shaheen, Portman, and Bingaman have won an important political victory for energy efficiency that paves the way for policy makers from both sides of the aisle to embrace energy efficiency as not only sound energy policy, but also as sound economic and sound national security policy,” said Kateri Callahan, president, Alliance to Save Energy. “To borrow from the late, great astronaut Neil Armstrong, the passage of H.R. 4850 is but a small step toward greater efficiency in our economy, but could prove a giant leap forward in terms of galvanizing future action on energy efficiency by the Congress.”

Guido Zucconi, director of congressional affairs, Air-Conditioning, Heating & Refrigeration Institute (AHRI), said H.R. 4850, if approved, would provide immediate relief for service-over-the-counter and small-duct high-velocity HVAC manufacturers.

“Service-over-the-counter commercial refrigerator manufacturers have faced a standard that was impossible for them to meet. This would relieve them of that regulatory stress and allow them the freedom to operate in the marketplace — especially if DOE’s patience wears thin with Congress,” said Zucconi. “Small-duct high-velocity manufacturers are currently operating on a waiver system. These products rate differently than small, unitary central air conditioning systems, simply because the technology is different. This bill would allow manufacturers to continue to produce these systems without the burden and risk of a waiver system.”

As the bill matures, many other manufacturers could feel the effects, said Zucconi.

“Other member manufacturers, including water heater manufacturers, would be affected down the road as the second section of the bill progresses and uniform test procedures and energy descriptors are finalized.”

Charlie McCrudden, vice president of government affairs, Air Conditioning Contractors of America (ACCA), said the bill will ease the existing burden on manufacturers.

“This provides relief by making technical corrections to key HVACR manufacturing laws,” he said. “These ‘fixes’ will remove some of the barriers currently restricting manufacturing, which, once removed, will allow these products to be more readily available and easier to produce in the future.”

As the lame-duck session begins, McCrudden said he wouldn’t be surprised to see this, and several other “noncontroversial” bills, passed.

“Congress should tackle a number of outstanding issues before the end of the year when dozens of tax credits are scheduled to expire, and I wouldn’t be surprised to see a large omnibus-type bill that wraps up tax extenders, energy policy, and other outstanding issues,” he said. “There will be a lot of pressure to include noncontroversial bills in at that time, and H.R. 4850 could easily make that list.”

Stephen Yurek, president and CEO, AHRI, said he is also hopeful the measure will soon gain the president’s signature.

“The cooperation between Senators Bingaman and Portman is an example for their colleagues in the House and we are grateful of their efforts to pass this legislation before the end of the legislative session,” said Yurek. “We look forward to working with House sponsors to expeditiously pass the Enabling Energy Saving Innovations Act and get it signed into law.”

Publication date: 11/5/2012