On August 30, 2012, President Obama signed an Executive Order to accelerate investments in industrial energy efficiency, including combined heat and power (CHP). Accelerating investment in industrial energy efficiency in a way that benefits manufacturers, utilities, and consumers can improve American manufacturing competitiveness and create jobs while improving the nation’s energy system and reducing harmful emissions.
The Executive Order:
- Sets a national goal of 40 gigawatts (GW) of new CHP installation over the next decade;
- Directs agencies to foster a national dialogue through ongoing regional workshops to encourage the adoption of best practice policies and investment models that overcome the numerous barriers to investment, provide public information on the benefits of unlocking investment in industrial energy efficiency, and use existing federal authorities that can support these investments;
- Directs the Departments of Energy, Commerce, and Agriculture, and the Environmental Protection Agency, to coordinate actions at the federal level while providing policy and technical assistance to states to promote investments in industrial energy efficiency.
Investments in industrial energy efficiency and CHP offer significant benefits to manufacturers, utilities, and communities across the country, including:
- Improving U.S. manufacturing competitiveness: By accelerating these investments, manufacturers could save at least $100 billion in energy costs over the next decade.
- Creating jobs now through investments upgrading our manufacturing facilities: Meeting the President’s goal of 40 GW of new CHP over the next decade would mean $40 billion to $80 billion of new capital investment in American manufacturing facilities. Most of these efficient technologies are made right here in the United States.
- Offering a low-cost approach to new electricity generation capacity to meet current and future demand: Investments in industrial energy efficiency, including CHP, cost as much as 50% less than traditional forms of delivered new baseload power.
- Significantly lowering emissions: Improved efficiency can meaningfully reduce nationwide GHG emissions and other criteria pollutants.
- Enhancing grid security: Investments in industrial energy efficiency reduce the need for new electricity infrastructure (transmission and distribution) and improve overall electric reliability.
In support of the Executive Order, DOE and EPA released a new report, Combined Heat and Power: A Clean Energy Solution, that provides a foundation for national discussions on effective ways to achieve 40 GW of new, cost-effective CHP by 2020, and includes an overview of the key issues currently impacting CHP deployment and the factors that need to be considered by stakeholders involved in the dialogue.
The Department of Energy is also announcing new private sector commitments by five companies—Kingspan Insulated Panels, Cree, General Aluminum Manufacturing Company, PaperWorks, and HARBEC Inc.—to the Better Buildings, Better Plants program where firms commit to improving energy intensity by 25% over 10 years. Partners in the Better Buildings, Better Plants Program have already experienced at least $80 million in cost savings—these actions alone are expected to save roughly $1 billion cumulatively by 2020.
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