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Congress Passes Scaled-Back Energy Efficiency Improvement Act

Apr 24, 2015
Sens. Rob Portman (R-OH) and Jeanne Shaheen (D-NH) have been trying to get an energy efficiency bill passed since 2011. A scaled-back version of S. 535, the Energy Efficiency Improvement Act of 2015, was approved in the U.S. House of Representatives on Tuesday, after sailing through the Senate on a voice vote March 27. Now this no-cost, no-mandate bill is heading over to President Obama for his signature.


Owners and managers of large commercial buildings report that tenants consume a large majority of their structures’ total energy. Choices made by office tenants in designing and operating within leased spaces have a significant impact on U.S. energy consumption. It is estimated that implementing energy efficient performance measures during the suite build-out phases in commercial buildings can save tenants between 30 and 50 percent in energy costs, with a payback period of three to five years.

In the past, energy efficiency efforts have primarily focused on how developers may lower energy consumption at the ‘‘whole-building’’ level. For example, the Energy Star program for commercial ‘‘whole-buildings’’ administered by EPA is based on ‘‘whole-building’’ recognition for ‘‘top of the class’’ energy performers. The program is a voluntary, public-private program, which has improved how real estate owners, utilities, governments, and businesses interact with their customers to improve energy efficiency in buildings and lower energy costs. The Energy Star program is currently used by hundreds of thousands of buildings, organizations, and programs throughout the United States.

S. 535 creates a similar, voluntary program for tenants to reduce overall energy consumption and utility costs for consumers. Specifically, Title I of this bill requires the Administrator of the Environmental Protection Agency (EPA), in consultation with the Secretary of Energy, to develop a voluntary “Tenant Star” program within the existing Energy Star Program, with the intent of reducing tenant energy consumption. It also requires the Administrator of Energy Information Administration within the Department of Energy to collect data on specified commercial energy consumption, which will be used in determining eligibility for the “Tenant Star” program.

Other Provisions

Title II exempts certain electric resistance water heaters from a 2010 Department of Energy regulation, if they include capabilities allowing their use in electric thermal storage or demand response programs, and specifies certain data reporting requirements for manufacturers and utilities to report to DOE on the number of units enrolled in such programs.

Title III requires certain benchmarking and disclosure requirements for federal agencies that lease commercial buildings without Energy Star labels, with specified exceptions. The Title also requires the EPA Administrator to study the impact of energy efficiency disclosure requirements in the bill and report findings to Congress. Additionally, the Secretary of Energy, in coordination with other relevant agencies, will be required to maintain a database for storing and making publicly available energy-related information on commercial and multi-family buildings.

NECA has been supporting the Portman-Shaheen bill since it was first introduced in the last Congress. Though modest in scope, this modified version advances energy efficiency through reduced regulatory burden, increased transparency, and a focus on the federal government as a first mover to save taxpayer dollars on energy. The Senate Energy and Natural Resources Committee will hold a hearing on April 30 on a broader array of energy efficiency bills, and the House Energy and Commerce Committee is expected to hold a similar hearing soon.
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