ENERGY/CLIMATE BILL WEAK ON EFFICIENCY

Kerry and Lieberman Proposal Scales Back Energy Efficiency Provisions, Raising Costs to Consumers
May 12, 2010 (American Council for an Energy Efficient Economy)

"The compromise Kerry-Lieberman proposal… misses out on a key opportunity to address the cost of curbing climate change by including little on energy efficiency — the first, best, and least-cost carbon-reduction opportunity. The Kerry-Lieberman proposal does much less for energy efficiency than previous major climate change bills…[House and previous Senate legislation] provide emissions allowances to fund a variety of state energy efficiency programs and a requirement that gas utilities use a portion of their free emissions allowances to operate energy efficiency programs. On state programs, Kerry and Lieberman provide less than a quarter of the allowances provided…On natural gas programs, Kerry-Lieberman have reduced the minimum share of allowances to energy efficiency from one-third to one-fifth. On the other hand, the Kerry-Lieberman proposal does include several useful transportation provisions and also a small short-term program for industrial efficiency…

"In addition to concerns about cuts to energy efficiency provisions, ACEEE also noted that by providing rebates to consumers through their energy bills, the Kerry-Lieberman proposal would also reduce the incentive for consumers to conserve energy on their own…"

By reducing emphasis on Energy Efficiency, the new energy/climate bill is passing up the most cost-effective option. (click to enlarge)

"…Senators Kerry and Lieberman have acknowledged the positive role energy efficiency can play, and have referred to the energy efficiency provisions in an energy bill reported out by the Senate Energy Committee. However, according to a previous analysis by ACEEE, the majority of energy savings in the Senate Energy Committee bill requires funding that was expected to come from a climate bill, but such funding is missing from the Kerry-Lieberman bill…

"The previous ACEEE analysis on the House-passed energy and climate bill concluded that the energy efficiency provisions in the bill would save the average American household about $200 annually by 2020. These consumer savings would exceed the non-efficiency costs per household of the legislation, which the Congressional Budget Office estimated to be $175 in 2020. ACEEE also estimated the energy savings of the energy bill reported out by the Senate Energy Committee and found that this bill would save less than half the energy of the House-passed bill. Of the savings in the Senate Energy Committee bill, more than 60% of the savings are dependent on Congress providing funding for the provisions. Without this funding, savings from the Senate Energy Committee bill will be about one-quarter of the savings from the House-passed bill…"