Passed: The Energy Efficiency Improvement Act Of 2015

Posted by Heidi Schwartz

Senators Rob Portman (R-OH) and Jeanne Shaheen (D-NH), sponsors of the bill.
Senators Rob Portman (R-OH) and Jeanne Shaheen (D-NH), sponsors of the Energy Efficiency Improvement Act of 2015.

The United States Congress, with bipartisan support, has passed a bill titled the Energy Efficiency Improvement Act of 2015. Authored by Senators Rob Portman (R-OH) and Jeanne Shaheen (D-NH), the legislation passed the Senate in late March and the House in late April 2015. The bill aims to promote energy efficiency in commercial buildings in three ways:

  • Better Buildings Act: a new voluntary energy program within the current Energy Star framework;
  • Grid-Enabled Water Heaters: new regulations for smart grid-enabled water heaters; and
  • Energy Information for Commercial Buildings: benchmarking and public disclosure of energy usage for buildings so facility managers and building occupants can better understand current energy performance level of their space.

The Act And HVAC

While it is presently unclear in the current language of the bill if or how the public disclosure of energy usage for individual buildings will be accessible to the general public, the heating, ventilation and air conditioning (HVAC) industry could greatly benefit from such legislation if that is indeed the case. Currently in the United States, Energy Star certifications act as a way for facility managers to show the general public that they are doing their part in limiting energy usage. However, these programs are voluntary and there are no penalties when standards are not reached.

If information on energy usage of buildings was accessible to the public, facility managers and businesses that were found to use an exorbitant amount of energy could be put under pressure by environmental advocacy groups and the general public to find ways to cut power consumption. This could be an important development in promoting energy efficiency, as many political leaders at the state and federal levels are unwilling to pass prescriptive and punitive energy reform measures for the fear of being branded anti-business.

The bad public relations which could arise from the disclosure of energy consumption could force buildings to upgrade old and inefficient HVAC equipment at a faster rate. In addition to higher spending in HVAC equipment, buildings could also invest in more comprehensive HVAC controls systems and spend more on the service and maintenance of the new equipment and controls. This would lead to a further boost in retrofit and replacement HVAC business in cities with a high number of commercial buildings.

The Act And Water Heaters

Meanwhile, the Air-Conditioning, Heating, and Refrigeration Institute (AHRI) has voiced its support of the signing of the Energy Efficiency Improvement Act of 2015 for other reasons. The legislation allows for the continued manufacture and use of large capacity, grid enabled electric water heaters in electric thermal storage or demand respond programs, which were banned under the Department of Energy water heater efficiency standard that took effect April 16.

Electric utilities wanted to continue to have the ability to use large electric resistance water heaters as part of their demand response efforts. To be eligible, the water heaters must have a volume of more than 75 gallons, have a minimum energy efficiency factor, and work on grids that have a demand response system.

“The passage of this bill will allow for the continued manufacture of water heaters whose energy can be used by electric cooperatives and other utilities to manage power supply and demand more effectively, allowing for more efficient use of energy,” said Stephen Yurek, AHRI President & CEO.

The Secretary of Energy will establish procedures to prevent product diversion if the number of units sold exceeds the number of units activated for use in electric thermal energy or demand response programs by 15% or more.

In response to the signing of the Energy Efficiency Improvement Act, ACEEE executive Steven Nadel said, “We congratulate President Obama for signing into law the Energy Efficiency Improvement Act. We look forward to continuing to work with the White House and Congress to deliver the benefits of energy efficiency to the nation including reduced utility bills, a better-functioning electric grid, and a cleaner, healthier environment for our children. Energy efficiency is a truly nonpartisan issue, and thanks to the leadership of the president and Senators Portman and Shaheen, the US will benefit from wasting less energy.”

The bill, S. 535, is a narrow version of broader energy efficiency legislation that the two senators have been working on for the last four years.