[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]



          HOMESTAR: JOB CREATION THROUGH HOME ENERGY RETROFITS

=======================================================================

                                HEARING

                               BEFORE THE

                 SUBCOMMITTEE ON ENERGY AND ENVIRONMENT

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS


                               SECOND SESSION
                               __________

                             MARCH 18, 2010

                               __________

                           Serial No. 111-105







[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]








      Printed for the use of the Committee on Energy and Commerce
                        energycommerce.house.gov
                                _____

                  U.S. GOVERNMENT PRINTING OFFICE

76-017                    WASHINGTON : 2012
-----------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government Printing 
Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC 
area (202) 512-1800 Fax: (202) 512-2104  Mail: Stop IDCC, Washington, DC 
20402-0001










                    COMMITTEE ON ENERGY AND COMMERCE

                 HENRY A. WAXMAN, California, Chairman
JOHN D. DINGELL, Michigan            JOE BARTON, Texas
  Chairman Emeritus                    Ranking Member
EDWARD J. MARKEY, Massachusetts      RALPH M. HALL, Texas
RICK BOUCHER, Virginia               FRED UPTON, Michigan
FRANK PALLONE, Jr., New Jersey       CLIFF STEARNS, Florida
BART GORDON, Tennessee               NATHAN DEAL, Georgia
BOBBY L. RUSH, Illinois              ED WHITFIELD, Kentucky
ANNA G. ESHOO, California            JOHN SHIMKUS, Illinois
BART STUPAK, Michigan                JOHN B. SHADEGG, Arizona
ELIOT L. ENGEL, New York             ROY BLUNT, Missouri
GENE GREEN, Texas                    STEVE BUYER, Indiana
DIANA DeGETTE, Colorado              GEORGE RADANOVICH, California
  Vice Chairman                      JOSEPH R. PITTS, Pennsylvania
LOIS CAPPS, California               MARY BONO MACK, California
MICHAEL F. DOYLE, Pennsylvania       GREG WALDEN, Oregon
JANE HARMAN, California              LEE TERRY, Nebraska
TOM ALLEN, Maine                     MIKE ROGERS, Michigan
JANICE D. SCHAKOWSKY, Illinois       SUE WILKINS MYRICK, North Carolina
CHARLES A. GONZALEZ, Texas           JOHN SULLIVAN, Oklahoma
JAY INSLEE, Washington               TIM MURPHY, Pennsylvania
TAMMY BALDWIN, Wisconsin             MICHAEL C. BURGESS, Texas
MIKE ROSS, Arkansas                  MARSHA BLACKBURN, Tennessee
ANTHONY D. WEINER, New York          PHIL GINGREY, Georgia
JIM MATHESON, Utah                   STEVE SCALISE, Louisiana
G.K. BUTTERFIELD, North Carolina
CHARLIE MELANCON, Louisiana
JOHN BARROW, Georgia
BARON P. HILL, Indiana
DORIS O. MATSUI, California
DONNA M. CHRISTENSEN, Virgin 
    Islands
KATHY CASTOR, Florida
JOHN P. SARBANES, Maryland
CHRISTOPHER S. MURPHY, Connecticut
ZACHARY T. SPACE, Ohio
JERRY McNERNEY, California
BETTY SUTTON, Ohio
BRUCE L. BRALEY, Iowa
PETER WELCH, Vermont
                 Subcommittee on Energy and Environment

               EDWARD J. MARKEY, Massachusetts, Chairman
MICHAEL F. DOYLE, Pennsylvania       RALPH M. HALL, Texas
JAY INSLEE, Washington               FRED UPTON, Michigan
G.K. BUTTERFIELD, North Carolina     ED WHITFIELD, Kentucky
CHARLIE MELANCON, Louisiana          JOHN SHIMKUS, Illinois
BARON HILL, Indiana                  JOHN B. SHADEGG, Arizona
DORIS O. MATSUI, California          STEVE BUYER, Indiana
JERRY McNERNEY, California           GREG WALDEN, Oregon
PETER WELCH, Vermont                 SUE WILKINS MYRICK, North Carolina
JOHN D. DINGELL, Michigan            JOHN SULLIVAN, Oklahoma
RICK BOUCHER, Virginia               MICHAEL C. BURGESS, Texas
FRANK PALLONE, Jr., New Jersey
ELIOT ENGEL, New York
GENE GREEN, Texas
LOIS CAPPS, California
JANE HARMAN, California
CHARLES A. GONZALEZ, Texas
TAMMY BALDWIN, Wisconsin
MIKE ROSS, Arkansas
JIM MATHESON, Utah
JOHN BARROW, Georgia
















                             C O N T E N T S

                              ----------                              
                                                                   Page
Hon. Edward J. Markey, a Representative in Congress from the 
  Commonwealth of Massachusetts, opening statement...............     1
.................................................................
Hon. Fred Upton, a Representative in Congress from the State of 
  Michigan, opening statement....................................     3
Hon. John D. Dingell, a Representative in Congress from the State 
  of Michigan, opening statement.................................     4
Hon. Joseph R. Pitts, a Representative in Congress from the 
  Commonwealth of Pennsylvania, opening statement................     5
Hon. Michael F. Doyle, a Representative in Congress from the 
  Commonwealth of Pennsylvania, opening statement................     6
Hon. Henry A. Waxman, a Representative in Congress from the State 
  of California, opening statement...............................     6
Hon. Peter Welch, a Representative in Congress from the State of 
  Vermont, opening statement.....................................     7
Hon. John Barrow, a Representative in Congress from the State of 
  Georgia, opening statement.....................................     8
Hon. Michael C. Burgess, a Representative in Congress from the 
  State of Texas, opening statement..............................     9
Hon. Jane Harman, a Representative in Congress from the State of 
  California, opening statement..................................    10
Hon. Joe Barton, a Representative in Congress from the State of 
  Texas, prepared statement......................................   100

                               Witnesses

Cathy Zoi, Assistant Secretary, Office of Energy Efficiency and 
  Renewable Energy, Department of Energy.........................    12
    Prepared statement...........................................    14
    Answers to submitted questions...............................   121
Larry Laseter, President, Masco Home Services....................    20
    Prepared statement...........................................    22
John Engler, President and Chief Executive Officer, National 
  Association of Manufacturers...................................    36
    Prepared statement...........................................    39
Michael Thaman, President and Chief Executive Officer, Owens 
  Corning........................................................    44
    Prepared statement...........................................    47
Christopher A.S. Pratt, Vice President, Construction Development 
  Services, LLC..................................................    49
    Prepared statement...........................................    51
    Answers to submitted questions...............................   140

                           Submitted Material

Statement of Consumers Energy Company, Michigan, submitted by Mr. 
  Dingell........................................................   106
Statement of Laborers' International Union of North America, 
  submitted by Ms. Capps.........................................   112
Statement of six public health organizations, submitted by Ms. 
  Capps..........................................................   114
Statement of the National Association of Realtors, submitted by 
  Mr. Stearns....................................................   115

 
          HOMESTAR: JOB CREATION THROUGH HOME ENERGY RETROFITS

                              ----------                              


                        THURSDAY, MARCH 18, 2010

                  House of Representatives,
            Subcommittee on Energy and Environment,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
    The Subcommittee met, pursuant to call, at 10:06 a.m., in 
room 2123 of the Rayburn House Office Building, Hon. Edward J. 
Markey [Chairman of the Subcommittee] presiding.
    Members present: Representatives Markey, Doyle, Inslee, 
Melancon, McNerney, Welch, Dingell, Capps, Harman, Baldwin, 
Barrow, Waxman (ex officio), Upton, Stearns, Shimkus, Pitts, 
Burgess, Scalise, Griffith and Barton (ex officio).
    Staff present: Bruce Wolpe, Senior Advisor; Greg Dotson, 
Chief Counsel, Energy and Environment; John Jimison, Senior 
Counsel; Michael Goo, Counsel; Melissa Cheatham, Professional 
Staff Member; Caitlin Haberman, Special Assistant; Peter 
Ketcham-Colwill, Special Assistant; Lindsay Vidal, Special 
Assistant; Aaron Cutler, Minority Counsel; Mary Neumayr, 
Minority Counsel; Andrew Spring, Minority Professional Staff; 
and Garrett Golding, Minority Legislative Analyst.

OPENING STATEMENT OF HON. EDWARD J. MARKEY, A REPRESENTATIVE IN 
        CONGRESS FROM THE COMMONWEALTH OF MASSACHUSETTS

    Mr. Markey. Good morning. A few hours from now March 
Madness will officially begin, although for anyone who has 
walked the Capitol Hill halls in the last few days, the madness 
seems to have already started. Unfortunately, my alma mater, 
Boston College, missed the tournament. So since I cannot root 
for my home team, today I will root for HomeStar. Instead of 
watching players score buckets by banking the ball off the 
backboard window, today we will talk about families banking 
bucks through energy-efficient windows and I can guarantee one 
thing, the HomeStar Program will give people a much better 
return on investment then filling out an NCAA bracket.
    HomeStar is our new three-point play for American families 
during this economic recovery. One, it saves energy. Two, it 
saves money. Three, it creates jobs.
    So what is HomeStar? It is a program designed to help every 
homeowner looking for a little extra help to make their home 
more efficient by saving energy. The program will provide 
homeowners rebates for purchasing and installing more efficient 
windows, doors, insulation and other home improvements that 
will cover energy bills while jumpstarting our manufacturing 
and labor sectors. HomeStar was designed to give customers 
their rebates quickly and reimburse contractors within 30 days. 
It will, under my direction, also include a do-it-yourself 
provision that allows people to receive rebates for buying and 
installing insulation materials without going through a 
contractor.
    HomeStar was designed to reduce energy costs in several 
ways. Homeowners receive rebates on products and installation. 
They may also benefit from a loan program to offset the 
remaining cost of the project. Finally, homeowners save on 
reduced heating and cooling costs. HomeStar efficiency upgrades 
are estimated to save homeowners over $1 billion of home energy 
expenses in 2011, and $9.2 billion over 10 years.
    And finally, HomeStar was designed to help American workers 
get back on their feet through energy-efficient construction 
and manufacturing jobs. The products in the Silver Star portion 
of the bill are largely manufactured in the United States. 
Creating a consumer market for these products through HomeStar 
will help save and create approximately 168,000 jobs in the 
next 10 years. Most of these jobs will be available in the next 
2 years. That is why there is such a broad support for 
HomeStar. Fortune 500 companies, small contractors, 
environmental advocates and lumber manufacturers are just some 
of the organizations that have supported HomeStar.
    I would be remiss if I did not mention the hard work of my 
colleague, Peter Welch, who has been a champion of HomeStar and 
a long time supporter of building efficiency as evidenced by 
his provision in the Waxman-Markey legislation that passed the 
House last June. Right now, we don't know who will win March 
Madness. We do know that HomeStar is a winning program for 
hundreds of thousands of American workers, families and our 
ongoing efforts to spur a lasting, sustainable economic 
recovery through clean energy jobs and technologies.
    That completes the opening statement of the chair.
    We now turn and recognize the ranking member, the gentleman 
from Michigan, Mr. Upton.
    Mr. Upton. Well, thank you, Mr. Chairman, and sorry that 
your Boston College team didn't make it. Neither did my 
Wolverines. Maybe we could get the majority leader to do a 
resolution like he did for Maryland on the House floor, 
complimenting them on a wonderful season although they didn't 
win the ACC tournament, like we did yesterday.
    Mr. Markey. But they are in the tournament.
    Mr. Upton. Not the Wolverines.
    Mr. Markey. No, but I mean the Terrapins are in the 
tournament.
    Mr. Upton. They are in but they didn't win the ACC. They 
lost the first game of the tournament but we will see how you 
fill out your bracket.
    Mr. Markey. But they are still alive. They are more like 
the HomeStar Program than Boston College.
    Mr. Upton. Yes, yes, we will see how far they go.
    Mr. Markey. OK.

   OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF MICHIGAN

    Mr. Upton. I appreciate the hearing today and I have always 
been a proponent of all of the above energy policies. All of 
the above isn't just about all sources of energy. It also 
includes conservation and energy conservation. Upgrading energy 
efficiency in homes clearly is the low-hanging fruit in 
reducing overall energy demand and has the added benefit of 
directly lowering home energy bills which is of critical 
importance for working families that are struggling to get by.
    I support energy efficiency and there are bipartisan ways 
to create incentives for home energy efficiency upgrades but I 
am not sure that this legislation fits that bill. The HomeStar 
legislation that we are looking at today could prove to be far 
too expensive at a time of massive budget deficits and runaway 
spending. We don't know what the cost will be because the bill 
as you know as written is a blank check to the appropriators, 
such sums as may be necessary, as the legislation states, so 
how much are we talking about? Is it $6 billion, is it $20 
billion, it could be more. I don't support signing a blank 
check.
    With all due respect to the Department of Energy, they are 
not equipped to run a program of this magnitude regardless of 
whether it is $1 billion or $20 billion. According to the GAO, 
only 9,100 of a planned 593,000 homes were weatherized this 
last year, 9,100 out of 593,000. That is more than a rounding 
error. In my home State of Michigan, 395 homes were weatherized 
in 2009 at a cost of $4 million so there is still another $240 
million left unspent in the Stimulus Package that was passed 
last year. Nationally, about $522 million in Stimulus funds 
have been spent so far on weatherization. That is about 10 
percent of the $5 billion set aside. Why are we going to throw 
countless billions on top of that? Clearly, more money is not 
the answer or the issue.
    Besides the runaway spending and DOE's inability to 
administer the first $5 billion allocated, there are other 
problems as well. Good policy would suggest a HomeStar-type 
program should complement state-regulated energy efficiency 
programs not disrupt them. Existing energy efficiency programs 
are the best way to distribute funding with the greatest level 
of quality assurance, not a giant, new government bureaucracy.
    This legislation as I look at it does pick winners and 
losers, both technology winners and losers, and labor winners 
and losers. That is not the job of this body as we seek to 
promote energy efficiency. It seems to me that many energy 
efficient technologies were left off the list solely because 
their manufacturers weren't represented in the HomeStar 
Coalition. That is not necessarily the American way. The 
American people have grown quite tired of these backroom deals 
and I hope that we can remedy this situation when we markup the 
bill, perhaps as early as next week.
    I would also note that the President's budget called for a 
freeze in spending so where does that fit in when you look at a 
new $23 billion program? Now, we in the Congress now have 
passed PAYGO legislation, where are the offsets? I am not sure 
that this is the best answer and I yield back my time.
    Mr. Markey. The gentleman's time has expired.
    The chair recognizes the Chairman Emeritus of our 
committee, Mr. Dingell.

OPENING STATEMENT OF HON. JOHN D. DINGELL, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF MICHIGAN

    Mr. Dingell. Mr. Chairman, thank you for holding this 
important hearing today. I am pleased that the subcommittee is 
setting forth an aggressive agenda for the HomeStar Program.
    I want to take a moment to welcome Larry Laseter from Masco 
Home Services. Welcome, Larry. Masco is headquartered in 
Taylor, Michigan and is an outstanding corporate citizen of the 
State of Michigan so welcome to you, Mr. Laseter, and we look 
forward to your testimony. Also, Governor Engler, it is a 
pleasure to see you this morning.
    HomeStar holds much promise in three important areas. First 
and foremost, it will create jobs. Second, it will lead to 
greater residential energy efficiency. Third, it has the 
potential to lead to significant consumer savings.
    In terms of jobs, my home State of Michigan is in a 
desperate state. Our current unemployment rate is 14.3 percent 
and Wayne County, my home county, has an unemployment rate of 
15.7 percent. Between 2001 and 2009, Michigan lost nearly 43 
percent of its construction jobs. The bottom line, Mr. 
Chairman, we need jobs and we need them desperately.
    This is a program which has the potential to put 168,000 
workers back on the job. Not only will this help individual 
workers but it will also help small businesses, a portion of 
our economy which has been particularly hard hit. We cannot 
afford not to move forward.
    According to HomeStar Coalition, the energy efficiency 
gains have the potential to equal the removal of 615,000 
automobiles from the road. This is particularly important since 
the Senate has yet to act on broader climate change 
legislation.
    Finally, the program will be of great benefit to 
homeowners. It could save families as much as $9.4 billion in 
energy costs over the next 10 years. In addition, it makes 
homes more valuable. In these economic times, these increased 
savings and increased home values cannot be underestimated.
    Mr. Chairman, HomeStar follows on the heels of the widely 
successful Cash for Clunkers Program in which the Federal 
Government provided consumer vouchers to purchase new, more 
fuel-efficient vehicles. The initial allocation of $1 billion 
was exhausted very quickly and we had to secure an additional 
$2 billion in funding for the program. Cash for Clunkers was 
responsible for the sale of nearly 700,000 new vehicles in the 
United States during its run and it added nearly one percent to 
the third quarter gross domestic product growth. Cash for 
Clunkers has been hailed as one of the most successful of all 
recent Government economic stimulus programs. According to the 
Center for Automotive Research (CAR), Cash for Clunkers created 
approximately 40,200 new jobs nationally of which 5,800 were in 
Michigan.
    I ask unanimous consent to submit the testimony of 
Consumer's Energy, a fine American corporation situated in the 
southeast corner of Michigan, from the Senate Committee on 
Energy and Natural Resources on this matter. And, Mr. Chairman, 
I look forward to working with the subcommittee on this 
important legislation and I commend you again for having this 
hearing.
    Mr. Markey. We thank the gentleman and we will by unanimous 
consent include that material in the record.
    [The information appears at the conclusion of the hearing.]
    Mr. Markey. The chair recognizes the gentleman from 
Pennsylvania, Mr. Pitts.

OPENING STATEMENT OF HON. JOSEPH R. PITTS, A REPRESENTATIVE IN 
         CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA

    Mr. Pitts. Thank you, Mr. Chairman.
    I would like to thank you for convening this hearing today 
on the proposed legislation to incentivize home energy 
retrofits and reduce unemployment in the construction sector. 
With the unemployment rate at nearly 10 percent in the United 
States, I believe that it is crucial that Congress focuses on 
creating a climate that promotes job creation. By the same 
token, I also believe that sound energy efficiency measures 
will certainly decrease the amount of greenhouse gas emissions 
in our atmosphere. They will also encourage our country to 
strengthen our energy security and end our dependence on 
foreign energy resources.
    The legislation that is being proposed to institute a 
rebate-type program has many promising aspects to it. Under the 
Silver Star Program, rebates will be awarded to participating 
contractors and vendors who perform qualifying energy-savings 
measures. Under the Gold Star Program, rebates will be awarded 
to participating contractors and vendors for retrofits that 
achieve home energy savings. However, I am concerned that 
Section 13A provides that, ``There are authorized to be 
appropriated to carry out this Act such sums as may be 
necessary.''
    We are operating in a fiscally constrained environment. It 
is our job on this committee to authorize a dollar amount. 
While the Senate version calls for a $6 billion program, I am 
greatly concerned about deficit spending or whatever pay-for 
may be used to offset this spending. Additionally, I am 
concerned that the implementation of this program will be 
inefficient. Mr. Chairman, I do agree that creating an 
environment that stimulates jobs is the key however it is of 
the utmost importance that we do this prudently.
    I look forward to hearing from our witnesses today and I 
thank you and yield back.
    Mr. Markey. We thank the gentleman.
    The chair recognizes the gentleman from Vermont, Mr. Welch. 
Oh, I am sorry. The chair recognizes the gentleman from 
Pennsylvania, Mr. Doyle. I apologize.
    Mr. Doyle. Thank you, Mr. Chairman, and for the record, the 
University of Pittsburgh is in the NCAA Tournament.
    Mr. Upton. Do they get a resolution today too?

OPENING STATEMENT OF HON. MICHAEL F. DOYLE, A REPRESENTATIVE IN 
         CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA

    Mr. Doyle. I want to thank you for convening this hearing 
today to explore the HomeStar Program that President Obama 
proposed in his State of the Union Address. Over the past 
several years, I have been very interested in the green 
building movement and the technologies and innovations this 
movement has brought forward. As some of you know, the City of 
Pittsburgh is at the forefront of the green building movement. 
Innovations by our researchers, work by our construction 
companies and a real eye to the future has created innovations 
that I believe can benefit each and every Congressional 
District in our Nation. The time for building without concern 
for energy costs is behind us, and the very same can be said 
about energy efficiency. As my constituents are faced with 
rising energy costs in a recession, they are struggling to find 
ways to cut their energy usage but the truth remains that many 
of the investments needed to make your home more energy 
efficient are financially impossible for families in today's 
economy.
    The HomeStar Program will offer families hoping to cut 
their energy costs, the chance to make energy-efficient 
upgrades to their homes with the promise of an immediate rebate 
from the contractor they hire to do this work. If the 
Weatherization Assistance Program in Pennsylvania is any 
indication, HomeStar will be a very popular program in my 
State.
    Another opportunity with the HomeStar Program is the job 
creation potential. The program will increase employment in the 
construction sector which we all know has been particularly 
hard hit in the last year. And the manufacturing sector which 
is imperative to the economy in Pittsburgh and really, all 
across America is set to benefit because the materials used in 
HomeStar projects will be almost entirely domestically sourced. 
I can't think of a greater win-win right now, Mr. Chairman, 
unless of course the Tea Party decides to endorse a single-
payer system today.
    I look forward to the testimony today as we hammer out the 
details of how this program will be run. I do have a few 
questions regarding the administration of the program and 
making sure that the work done is quality and provides 
measurable savings to homeowners. Mr. Chairman, thank you for 
getting the ball rolling on this excellent program and I yield 
back the balance of my time.
    Mr. Markey. Great, the gentleman's time has expired.
    The chair recognizes the Chairman of the full committee, 
Mr. Waxman.

OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. Waxman. Thank you, Chairman Markey. Thank you for 
holding this hearing.
    Today our Nation continues its courageous struggle to 
overcome the worst recession in 70 years. No sector of the 
economy has been harder hit than the home construction services 
sector. Today more than one in four construction workers are 
unemployed, more than twice the national average. We need these 
workers and their skills more than ever.
    We must seize the opportunity to modernize our homes and 
buildings and ensure their efficient use of energy. Ten percent 
of global greenhouse gas emissions are attributable to American 
buildings. Improving the efficiency of those buildings would 
allow us to reduce our carbon pollution and save money at the 
same time.
    The HomeStar proposal is compelling because it addresses 
both of these problems simultaneously. First, the proposal will 
put a lot of people back to work making our homes more 
efficient. At the same time, it can stimulate the manufacturing 
sector by increasing demand for energy-efficient products. By 
some estimates, HomeStar will create more than 130,000 direct 
and indirect near term jobs. Second, HomeStar will cut our 
carbon pollution in the near term and be an important down 
payment for even more successful reductions in the future.
    I want to commend Chairman Markey and Representative Welch 
for their leadership on this proposal. They have had the vision 
to see the tremendous economic and environmental benefits of 
nurturing energy efficiency retrofits into a major, national 
undertaking. President Obama has lent his unequivocal support 
to this initiative. We now have the opportunity in our 
committee to make HomeStar a priority and deliver jobs and 
energy efficiency to America's housing and commercial office 
stock throughout the country.
    I would also like to welcome today's witnesses, Assistant 
Secretary Zoi, Governor Engler, Mr. Laseter, Mr. Thaman and Mr. 
Pratt. I appreciate your joining us today and look forward to 
hearing your testimony.
    Mr. Markey. Great, the Chairman's time has expired.
    The chair recognizes the gentleman from Vermont, Mr. Welch.

  OPENING STATEMENT OF HON. PETER WELCH, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF VERMONT

    Mr. Welch. Thank you, Chairman Markey. I very much 
appreciate you convening this hearing. Thank you Ranking Member 
Upton.
    We introduced RECRP, the National Residential Commercial 
Residential Retrofit Program that was passed by this committee 
and the House. It was a coalition that identified, like we have 
today, the incredible potential of the low-hanging fruit of 
energy efficiency and today we have witnesses who show that 
this is bipartisan. It represents something powerful across the 
country and I appreciate Secretary Zoi, Mr. Laseter, Governor 
Engler, Mr. Thaman and Mr. Pratt for being here. You are on the 
front lines. You know how it works. You know it is real and you 
are here to testify and demonstrate that this is a public and 
private partnership, market-based approach to getting something 
done.
    HomeStar is going to put contractors to work. It is going 
to create manufacturing jobs because the source is as Mr. Doyle 
said, American and it is going to help small-town hardware 
stores as well as the big box retailers. It creates 168,000 
jobs this just small, modified program. Three million American 
families can cut their energy bills by $10 billion, $10 billion 
over 10 years and it reduces obviously our dependence on 
foreign oil.
    In Vermont, we are an efficiency State. We have an 
efficient utility. We have created thousands of jobs. We have 
reduced consumption by seven percent and we save folks money. 
That is a good deal for America. What we have seen is that this 
can work and with HomeStar we can replicate what is being done 
across this country and it is going to do those things that 
need to be done about jobs, about energy savings and about 
reducing our dependence on foreign oil.
    What is also so much a tremendous opportunity is that we 
can do this together. This Congress is locked in partisan 
battles and the real differences between us on many issues but 
this is an opportunity for us to find common ground about jobs, 
about energy independence and about putting our folks to work, 
and I am so grateful for you that you are here to testify about 
this and have us focus on doing something real, something 
useful, something necessary and do it together.
    I yield back.
    Mr. Markey. Great, the gentleman's time has expired.
    The chair recognizes the gentleman from Alabama, Mr. 
Griffith.
    Mr. Griffith. Thank you, Mr. Chairman.
    I look forward to working with my colleagues on this 
project. I know that it certainly sounds good theoretically and 
we hope that it works out practically but we know that we have 
had in the past some theoretical successes but some 
implementation problems with just such a project as this as it 
gets down into the communities so I am hoping that we solve 
those or anticipate those problems as we get to them, before we 
get to them so to speak. And I must say that energy efficiency 
is an important step in making our country less dependent on 
foreign oil but because this committee is concerned with energy 
in its totality, I think we not only need this sort of a 
program but we also need to make sure that we are not sending a 
mixed message to our energy producers and our outer-continental 
shelf 5-year plan should be a big part of this as well. And I 
appreciate the opportunity to participate with you and make 
sure that when it gets down to the contractor and the window 
manufacturers we don't get into a bureaucratic nightmare of 
paperwork and 3 or 4 months of form filling out and then no 
response. So I know those are on your mind so thank you, Mr. 
Chairman, for allowing me to participate.
    Mr. Markey. All right, thank you, the gentleman's time has 
expired.
    The gentleman from Georgia, Mr. Barrow is recognized.

  OPENING STATEMENT OF HON. JOHN BARROW, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF GEORGIA

    Mr. Barrow. I thank the chair.
    I am pleased that President Obama chose my hometown of 
Savannah earlier this month to come and roll out the 
Administration's support for this program and I think that it 
has got tremendous promise. I want to quickly register just a 
couple of areas of concern to me based on what we have learned 
from prior efforts in the past. Mention has already been made 
of the fact that the Weatherization Program in the Recovery Act 
hasn't gone as far as we would like. It is not that the program 
hasn't been--the money has been wasted. The money hasn't been 
spent yet and comments have been made that what we don't need 
is something that is impossible to administer or something that 
is impossibly bureaucratic. I happen to believe that this is a 
direct response to our experience with the Recovery Act's 
effort to plus-up existing programs that are relatively high 
maintenance. I remember a great line in the movie ``When Harry 
Met Sally'' when they are talking about relationships that are 
high maintenance and low maintenance and the girl asked the guy 
well what am I and he said well you are the worst kind. You are 
high maintenance but you think you are low maintenance, and I 
kind of feel like that is what the Recovery Act was. It took a 
high maintenance program but we treat it as if it is low 
maintenance and put all kinds of resources into it and it just 
hasn't gotten through. This is a low maintenance approach and 
the more user-friendly we can make this, I think the more 
effective it will be and that I think is an important first 
step.
    Now, I want to know what we can do to actually make this 
not just think it is low maintenance but actually be low 
maintenance and I want to explore with you all and get your 
ideas about we can make this as efficient as possible. Also, 
God bless the do-it-yourselfers out there to the extent that we 
are going to authorize some relief and help with folks who can 
do it themselves. That is important. We might not be helping 
the contracting community quite as much but the manufacturing 
base is going to get a boost out of this and the homeowner who 
is going to have sweat equity in this is going to have the 
energy savings and efficiency to show for it so I want to 
explore those two areas. I want to thank Mr. Welch especially 
for his leadership is this area and with that, Mr. Chairman, I 
yield back the balance of my time.
    Mr. Markey. Great, the gentleman's time has expired.
    The chair recognizes the gentleman from Texas, Mr. Burgess 
is recognized.

OPENING STATEMENT OF HON. MICHAEL C. BURGESS, A REPRESENTATIVE 
              IN CONGRESS FROM THE STATE OF TEXAS

    Mr. Burgess. Thank you, Mr. Chairman.
    You know, energy efficiency is the common ground in a lot 
of our fights that we have on this committee and really 
efficiency measures are some of the quickest and most concrete 
ways of solving the energy problems and move this country to a 
more--to a cleaner and more sustainable energy future and the 
market proves this. Upgrade your home's windows and insulation 
and as a consumer, you watch your bills drop. Rather than have 
this committee spend its time with climate bills that run the 
risk of further damaging our already fragile economy, I have 
consistently maintained that both sides of the aisle can come 
together on commonsense issues like efficiency helping to 
reduce our dependency on fossil fuels and make our country a 
greener place to live.
    And not only have I advocated here in the halls of 
Congress, I have also promoted it within the walls of my own 
home. My wife and I built a house in north Texas 4 years ago. 
We wanted to make the investment and use energy efficient 
techniques at the time of building because we knew it would pay 
off down the road and as you can imagine one of the biggest 
challenges in Texas is a long, hot summer. We found there were 
numerous ways to keep out the heat including focusing on low-E 
glass in the windows, higher efficiency air conditioners, an 
efficient attic system and foam insulation in the walls. We 
also installed light color shingles on the roof to reflect 
sunlight and installed a tankless water heater which is more 
efficient than the tank model. Each measure helped us lower our 
consumption on our energy bills to the point that they were 40 
percent lower than our previous years' bills when the house was 
finished.
    Energy efficiency shouldn't be something that we 
necessarily need to incentivize at the Federal level. Show 
people how their bills will drop and they will be running to 
buy a new water heater or to re-shingle their roof. Energy 
efficiency is something that we can promote without having to 
spend a single Federal dollar, certainly, without having to 
spend dollars that we don't have. The cost of this bill should 
concern everyone in this room. In the draft before us today, 
this committee cedes its power as an authorizing committee to 
the Appropriations Committee allowing appropriators rather than 
the authorizers to determine how much money is in the program. 
Regardless of ideology, members of this committee on both sides 
of the dais should be concerned over the precedent set by 
delegating that authority to another committee. Allowing 
phrases such as ``Such sums as may be necessary'' could be used 
for a program of this magnitude is simply giving a blank check 
to a Federal agency, something this Congress can no longer 
afford to do.
    And the devil is in the details with legislation such as 
this. I am grateful the drafters desire to get this program 
moving quickly once the bill has cleared both sides of the 
House or both sides of the Capitol but I am concerned that the 
finite list of approved upgrades, this committee is simply 
picking winners and losers for what technology will be eligible 
for efficiency rebates and I think more attention needs to be 
placed on ensuring that this list is as comprehensive as 
possible for the wide range of efficiency upgrades that are 
available to homeowners today.
    I thank the chairman for his indulgence and I will yield 
back the balance of my time.
    Mr. Markey. Great, the gentleman's time has expired.
    The chair recognizes the gentlelady from California, Ms. 
Harman.

  OPENING STATEMENT OF HON. JANE HARMAN, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Ms. Harman. Thank you, Mr. Chairman.
    This committee is not new to the issue of energy efficiency 
in homes and nor is my own district. Mr. Upton and I 
collaborated pretty successfully I think on lighting efficiency 
standards which are now part of Federal law and we are 
continuing to collaborate successfully I think on outdoor 
lighting standards which we will introduce as a stand-alone 
bill soon and which we hope will be part of the energy package 
that we pass some time later this Congress if we pass an energy 
package.
    In my own district, I just want to call attention to a 
family in Hermosa Beach, the Fortunatos, who are creating what 
they call a net-zero house. That means the house will produce 
as much energy as it uses. It is a revolution. It is not off 
the grid. It is the grid and Southern California Edison will 
move shortly to install smart grids which are also getting 
Stimulus Bill funding in Hermosa Beach so that other families 
can do the same thing.
    In Manhattan Beach, there is a company called Windstream 
which produces small, rooftop wind turbines. Windstream and a 
lighting company Ledtronics are partnering with the Fortunatos 
to make their house energy neutral. There is also a 
communications company in El Segundo which has put solar panels 
over its parking lots and they now produce 20 percent of the 
energy that company, a large communications company, uses.
    I have had solar panels on my rooftop in Venice, California 
for 9 years and they generate the energy I need for hot water 
so there are lots of good local projects. There is a huge 
history here of bipartisanship and these proposals we will hear 
about today will build on the strong record we have in the 
committee and I am very pleased to be here and to welcome our 
witnesses.
    I yield back.
    Mr. Markey. Great, the gentlelady's time has expired.
    The chair recognizes the gentlelady from California, Ms. 
Capps.
    Mrs. Capps. Mr. Chairman, thank you. I will waive my 
opening statement in favor of the questions and look forward to 
the testimony of our witnesses. Thank you.
    Mr. Markey. Great, the chair recognizes the gentleman from 
California, Mr. McNerney.
    Mr. McNerney. Well, thank you, Mr. Chairman, for holding 
this hearing this morning. I want to congratulate you and Mr. 
Welch for your leadership on this issue.
    I spent most of my career developing new energy technology 
and I can tell you it is hard work. It is dirty and the real 
low-hanging fruit is energy efficiency. I know Chairman Markey 
has beat that drum over and over and he is absolutely right. 
For every dollar you invest in energy efficiency, you get 
dollars back.
    And so I also can see there is a business right next to my 
office in California that is an energy efficiency. They go out 
and they look at homes. They see what needs to be done and they 
are making good money doing that and if we can incentivize that 
we are going to create thousands and thousands of jobs while 
helping our dependence on foreign oil. There is almost no 
downside that I can imagine for this bill so I look forward to 
what your testimony is and maybe make some improvements on the 
bill as we move forward but thank you for coming.
    And I will yield back the balance of my time.
    Mr. Markey. We thank the gentleman and all time for opening 
statements has been completed so we will turn to our first 
witness. Our first witness is Ms. Cathy Zoi. She is the 
Assistant Secretary for the U.S. Department of Energy, Office 
of Energy Efficiency and Renewable Energy. Prior to joining the 
Obama Administration, Ms. Zoi served as founding CEO of the 
Alliance for Climate Protection, as chief of staff on 
environmental policy in the Clinton Administration and as a 
former manager at the Environmental Protection Agency where she 
pioneered the Energy Star Program. Ms. Zoi, whenever you are 
ready, please begin.

  STATEMENTS OF THE HONORABLE CATHY ZOI, ASSISTANT SECRETARY, 
OFFICE OF ENERGY EFFICIENCY AND RENEWABLE ENERGY, DEPARTMENT OF 
  ENERGY; LARRY LASETER, PRESIDENT, MASCO HOME SERVICES; THE 
 HONORABLE JOHN ENGLER, PRESIDENT AND CHIEF EXECUTIVE OFFICER, 
    NATIONAL ASSOCIATION OF MANUFACTURERS; MICHAEL THAMAN, 
   PRESIDENT AND CHIEF EXECUTIVE OFFICER, OWENS CORNING; AND 
     CHRISTOPHER A.S. PRATT, VICE PRESIDENT, CONSTRUCTION 
                   DEVELOPMENT SERVICES, LLC.

                     STATEMENT OF CATHY ZOI

    Ms. Zoi. Thank you very much. Good morning, Chairman 
Markey, Ranking Member Upton.
    Mr. Markey. If you could turn on your microphone please and 
just move it in a little bit closer.
    Ms. Zoi. Thank you for the opportunity to appear before you 
today and it is a pleasure to appear.
    Mr. Markey. OK, just move that microphone down just a 
little. Just push it down just a little, OK, good.
    Ms. Zoi. How is that? Better, OK.
    Thanks for the opportunity to appear before you and it is a 
pleasure to appear with such a panel of knowledgeable industry 
witnesses. I will make my remarks brief and I have submitted a 
longer statement for the record.
    We have a tremendous opportunity right now to create jobs 
and save money for homeowners all across the country. There are 
approximately 130 million homes in the United States, very few 
of which are as efficient as they could be. Almost all of these 
homes could benefit from additional insulation, caulking, 
upgraded heating and air conditioning systems and other 
improvements. Just as critically, there is a workforce standing 
by ready to make those improvements. The overall construction 
sector currently faces a 27 percent unemployment rate. 
According to the Bureau of Labor Statistics, nearly two million 
construction jobs have been lost since December, 2007, two 
million hardworking Americans ready and anxious to find ways to 
apply their skills to new jobs. With the Home Retrofit Program, 
we can transform these two challenges into an enormous 
opportunity, tapping workers skills and availability to help 
American families save money and energy. Americans are spending 
over $200 billion per year on energy, money that could pay for 
housing, tuition or other basic necessities. As the President 
has said, if you saw $20 bills flying out your window, you 
would try to grab them so let us try to make it easier for 
American families to prevent their hard-earned cash from flying 
out of leaky, inefficient homes while we create good-paying 
jobs for folks across the country. We can do just that through 
a Home Retrofit Program like the one the President called for 
in his State of the Union.
    Two weeks ago, the President outlined more details of what 
he has in mind for HomeStar Program, including rebates 
delivered directly to consumers, a $1,000 to $1,500 level of 
Silver Star rebates, $3,000 Gold Star rebates for whole home 
retrofits, oversight to ensure quality installations and 
support for financing at the local level. Through this program 
we can create tens of thousands of jobs while achieving 
substantial reductions in energy use, up to the equivalent of 
the entire output of several 500 megawatt coal-fire power 
plants each year. Consumers taking advantage of the program are 
likely to save between $200 and $500 per year in their energy 
costs while improving the comfort and the value of their homes.
    I want to thank the members of the subcommittee and other 
members who have been working tirelessly on efforts to create 
legislative language that follows the President's vision. As 
the legislative process moves forward, we will continue to work 
with Congress on the bill until it is enacted. Today I am glad 
the subcommittee has convened the hearing and I am happy to 
answer questions regarding how the HomeStar proposal or how the 
Department would actually implement it once it is in law. My 
goal as Assistant Secretary for Energy Efficiency and Renewable 
Energy is to harness the ingenuity and ability of the American 
workforce to help families save energy and money. Retrofitting 
millions of American homes can truly transform energy 
consumption throughout the Nation while putting people to work. 
Last year, Secretary Chu said, ``In the next several decades, I 
believe that energy efficiency is our most powerful tool for 
reducing our carbon emissions and reducing our energy bills.'' 
While home energy retrofits could be crucial to realizing both 
of those goals while supporting American job creation.
    Thank you again for the opportunity to testify on this 
topic and I will gladly answer questions.
    [The prepared statement of Ms. Zoi follows:]



[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    
    Mr. Markey. Thank you.
    And our next witness is Mr. Larry Laseter. He is the 
President of WellHome, a subsidiary of a leading home 
improvement company and as the President of WellHome, we 
welcome you here, sir, and he is going to testify on behalf of 
HomeStar Coalition as the President of WellHome so we welcome 
you, sir.

                   STATEMENT OF LARRY LASETER

    Mr. Laseter. Thank you, Chairman Markey, Ranking Member 
Upton and the distinguished members of the subcommittee for the 
privilege to testify today and your dedication to energy 
efficiency. I would also like to thank Congressman Welch for 
his leadership on this issue.
    I am Larry Laseter, President of Masco Home Services, also 
known as WellHome. Our company is a home performance contractor 
and we are an operating company of Masco Corporation, a 
Michigan-based, Fortune 500 company and one of America's 
largest manufacturers of products for the home. Masco is better 
known by our leading brands such as Behr Paint, Delta Faucets, 
Craft Maid Cabinets and many others and we are the Nation's 
largest installer of insulation, but I am here today to speak 
on behalf of the HomeStar Coalition, a broad group of industry, 
labor, energy and environmental supporters, including more than 
600 small businesses representing all 50 States. We state 
together in support of the HomeStar Program which would deliver 
a rare triple win for the American people in the form of jobs, 
savings for consumers and a positive impact on the environment.
    Let me begin with jobs. Make no mistake about it, the 
construction industry is in the midst of a one-industry 
depression. The unemployment rate in construction is 27 
percent, nearly three times the overall jobless rate and this 
rate is higher than our Nation's unemployment rate at the 
height of the Great Depression. At Masco Corporation, we have 
felt the pain of this industry downturn and we felt it 
firsthand having lost 27,000 jobs or over 40 percent of our 
workforce. However, construction workers have the know-how and 
the experience for home energy retrofits and they are ready to 
get to work in jobs that cannot be outsourced overseas.
    These are workers like Michael Youngblood. Michael fell in 
love with construction when he started working for a family 
friend when he was only 15 years old. He built over 150 custom 
homes during a successful 18-year career but Michael found 
himself unemployed with a young family last year when the 
builder he was working for downsized from 25 project managers 
down to three. Michael joined our WellHome team in Michigan 
last summer, earned his Building Performance Institute 
certification and now helps homeowners achieve energy 
efficiency retrofit. HomeStar will create more jobs for 
construction workers like Michael, most of whom work for small 
businesses and it would drive increased demand for manufactured 
products and building materials that are almost universally 
made in the USA, supporting further job growth and economic 
impact and putting idle plants back online.
    For the American homeowner, the benefit comes in the form 
of annual energy savings of up to 45 percent. On average, these 
savings are equivalent to a $500 stimulus check that a 
participating homeowner would receive every year for years to 
come.
    And, of course, energy efficiency improvements will support 
energy independence in the environment. Home energy represents 
22 percent of our carbon output, twice that of passenger cars 
and more than two-thirds of America's over 100 million homes 
were built before modern building codes. There is clearly a 
need and HomeStar will fill that need by lowering the cost of 
these home improvements. Things like fixing drafty windows and 
leaking ducts, installing insulation and high efficiency 
heating and air conditioning systems, or undertaking whole home 
energy retrofits. Spurring consumer demand for these 
improvements will drive thousands of jobs for small contractors 
nationwide and in addition, the HomeStar Coalition remains 
committed to the inclusion of an incentive for customer-
installed measures under the Silver Star Program.
    But we also know that many middle-class Americans are 
squeezed by the economy and the credit crisis and that is why 
the HomeStar Program legislation allocates $200 million for 
State programs to make energy efficiency loans more available 
and more affordable. In addition, HomeStar establishes industry 
performance standards, ensures that a portion of all jobs are 
inspected by credentialed professionals after the project is 
completed and offers added incentives to contractors that 
invest in a properly trained and certified workforce. This 
quality assurance system based on rigorous technical standards 
delivers on the promise of energy savings for American 
families.
    I would like to conclude by affirming that HomeStar is a 
win-win-win for jobs, for the American consumer and for the 
environment. It will put an estimated 168,000 skilled Americans 
back to work in the hardest hit part of our economy, the 
struggling construction and its related manufacturing sector. 
It will help more than three million American families retrofit 
their homes for energy efficiency, saving them as much as $9.4 
billion in energy costs over 10 years, a return greater than 
the cost of the program itself and it will positively impact 
the environment and America's energy independence. On behalf of 
the current and future workers represented by the 600 
businesses that make up the HomeStar Coalition and the millions 
of households which will benefit in every community in America, 
I encourage you to move this bill forward without delay.
    Thank you for the opportunity to testify and for your 
important leadership on behalf of the American people.
    [The prepared statement of Mr. Laseter follows:]



[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    Mr. Markey. Thank you, Mr. Larry Laseter, very much.
    Our next witness is Governor John Engler. He is the 
President and CEO of the National Association of Manufacturers. 
He is the former Governor of Michigan and previously served for 
20 years in the State legislature. The National Association of 
Manufacturers is the largest industry trade group in America 
representing small and large manufacturers in every industrial 
sector in all 50 States. We welcome you, Governor Engler.

                    STATEMENT OF JOHN ENGLER

    Mr. Engler. Thank you, Mr. Chairman, very much for the 
opportunity to be with you today, ranking member and good 
friend, Fred Upton, distinguished subcommittee members, thank 
you for holding this hearing on the HomeStar proposal and 
offering me the opportunity to testify before you today. I 
thought maybe it could just be deemed that I had testified but 
then I thought I had better show up here in person and so here 
I am.
    The NAM members are very excited, very committed to working 
with the Administration.
    Mr. Markey. If you make the motion, we will pass the bill 
right now.
    Mr. Engler. The thought of being here though just to tell 
you that we want to work with you and the Administration and 
Congress to make the HomeStar proposal as effective as possible 
as soon as possible, and I am pleased to offer our support for 
this important program.
    Our manufacturers firmly believe that an effective program 
to encourage energy efficient home retrofits will stimulate job 
creation by increasing the demand for energy efficient products 
and services and will lead us down a path to more energy 
efficient economy, the bottom line, straightforward, more jobs, 
fewer emissions, less energy. The U.S. manufacturing sector was 
hit hard during the recession. Manufacturing employment has 
fallen by nearly 2.2 million since December of 2007, to a level 
just over 11 and a half million. The deep decline in the 
housing market which includes the home improvement sector has 
had a significant impact on manufacturing. Nearly a quarter of 
the manufacturing jobs have been lost in industries closely 
connected to housing such as furniture, wood and textile 
products, building materials. This sector continues to 
struggle. You have heard that today already and you will 
continue to hear that. Consequently, a sustainable upturn in 
the housing sector will be a key ingredient for getting 
manufacturing back on track, expanding production and creating 
high-paying jobs. In fact, the NAM estimates if, and that may 
be a big if, a healthy rebound in housing takes place over the 
next few years, it likely will create an additional 128,000 
manufacturing jobs in industries connected to this sector.
    The HomeStar Program that we are here today to talk about 
would spur much needed consumer demand for energy efficient 
products and building materials by providing significant and 
immediate rebates for home energy efficiency retrofits. In 
addition to promoting residential energy efficiency, HomeStar 
will quickly create jobs in the manufacturing, distribution and 
sale of energy efficient products. One key reason that has been 
mentioned and some of the members have touched on this, the 
HomeStar Program it will work I think as the consumers can act 
pretty much as soon as Congress acts. It is not necessary this 
program to wait for a Federal agency to act first and there is 
I think further evidence that a temporary, targeted incentive 
program like HomeStar can work the Clean Energy Manufacturing 
Tax Credit Program that was in the Stimulus Bill of last year 
has drawn tremendous interest from the private sector. Section 
48C provided 30 percent tax credit for investments in 
facilities that manufacture clean energy technologies and that 
includes the wind, solar, batteries, advanced transportation, 
advanced energy transmission. The initial tax credit under 48C 
was capped at $2.3 billion. It has the potential to generate 
some 58,000 jobs. It is already over subscribed and so we also 
are happy to support the Administration's initiative that Vice 
President Biden is announcing today that is going to provide 
additional $5 billion to expand that current program.
    We recognize the need to promote energy efficiency across 
the U.S. economy. Manufacturing accounts for one-third of our 
Nation's energy use. Cost effective energy efficiency and 
conservation measures are the key to reducing overall energy 
cost inputs and it is a way to stretch available energy 
supplies, at the same time reducing greenhouse gas emissions. 
The manufacturing sector itself has taken the lead in reducing 
energy usage and increasing energy efficiency making it a 
priority. The improvements in energy efficiency in the 
manufacturing sector have helped the country actually 48 
percent more efficient in energy use per unit of GDP and they 
have reduced the energy intensity of the U.S. economy by nearly 
two percent. Similar efforts by homeowners would make a 
substantial contribution to U.S. energy security because they 
also are responsible for about one-third of energy consumption 
as the Secretary mentions in her testimony.
    Manufacturers are committed to producing the necessary 
energy efficient consumer products such as insulation, windows, 
doors, skylight, heating and cooling systems and likewise, we 
are pleased to see in this morning's draft that was made 
available, the inclusion of other products that are also 
designed to promote residential energy efficiency. With more 
than half of the 86 million single-family homes throughout the 
United States built before modern codes even existed, the vast 
majority of the homes in the United States are not well-
insulated, have outdated heating and cooling systems, 
inefficient windows and doors. They are great candidates for 
energy efficiency upgrades. Just think this, if consumers 
install more energy efficient products, they could save up to 
30 percent on their energy bills and the MacKenzie Study which 
many of us are quite familiar with, show the United States can 
save more than $600 billion in energy costs by 2020 if we spent 
more on making our homes and our buildings more energy 
efficient.
    Mr. Chairman, as you and your subcommittee fully 
understand, the country faces significant challenges in terms 
of job creation and energy use. Our manufacturers believe the 
HomeStar Program provides a unique opportunity to the public 
and private sectors to work together to address two major 
policy objectives, creating jobs and lowering unemployment 
while making American homes more energy efficient. We look 
forward to working with you expeditiously to make HomeStar a 
reality.
    [The prepared statement of Mr. Engler follows:]



[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    Mr. Markey. Thank you, Governor, very much. Our honor to 
have you here with us, thank you.
    Our next witness, Mr. Michael Thaman, he is the President 
and CEO and Chairman of the Board of Owens Corning. Owens 
Corning is a global producer of residential and commercial 
building materials and fiberglass insulation. We welcome you, 
sir.

                  STATEMENT OF MICHAEL THAMAN

    Mr. Thaman. Chairman Markey, Ranking Member Upton and 
members of the committee, thank you for the opportunity to 
testify. I also thank Chairman Markey and the committee for 
your leadership in recognizing the importance of energy 
efficiency as it relates to national energy policy. 
Additionally, I would like to personally thank and recognize 
Congressman Welch for your hard work on the progress we have 
made.
    My name is Mike Thaman. I am Chairman and CEO of Owens 
Corning, a global company based in Toledo, Ohio. I am proud of 
Owens Corning and our energy efficiency focus. Our company was 
founded in 1938, when we first commercialize glass fibers that 
led to the creation of fiberglass insulation. We produce more 
energy-saving insulation than anyone else in North America. We 
operate 55 manufacturing facilities in the U.S., including 
insulation plants in Ohio, California, Texas, Georgia, New 
York, Kansas, Utah, Oregon, Arizona and Illinois.
    In the midst of the downturn in the U.S. economy and the 
housing industry, we have experienced significant job loss at 
Owens Corning. The businesses in our building materials group 
in the U.S. today employ 25 percent fewer people than at their 
peak of the U.S. housing cycle in 2006. In 2009, our insulation 
plants operated at only 50 percent of capacity, compared with 
full utilization in 2006.
    Contractors who buy and install our insulation are also 
struggling. Data from the Insulation Contractor Association of 
America indicates that the unemployment rate in the installer 
community is about 30 percent, three times higher than the 
current national unemployment rate.
    I join you today in support of HomeStar and your effort to 
create jobs in America. HomeStar as currently proposed will 
create demand for the residential insulation products that my 
company manufactures and sells. HomeStar will create jobs at 
Owens Corning. As important, it will create work for insulation 
contractors across the country as well as the suppliers and 
distributors that make up the sales and supply chain supporting 
America's insulation industry.
    As you know, HomeStar is designed to provide financial 
incentives for energy efficiency investments in residential 
buildings. It has two primary components, Gold Star which 
provides incentives for comprehensive energy audits and Silver 
Star which provides immediate near-term incentives to drive 
specific energy-saving investments like insulation, windows, 
doors, HVAC systems and water heaters. We strongly support both 
components of the program. We do believe that Silver Star is 
more likely to have the most immediate impact on jobs.
    We have carefully studied HomeStar. It will create jobs at 
Owens Corning and at many other businesses that employ workers 
across the housing sector. HomeStar will also reduce energy use 
and home energy utility bills. That is important. According to 
the EPA, the average U.S. household spends more than $2,200 a 
year on energy bills with nearly half going to pay heating and 
cooling costs. Buildings in the country are the largest energy 
consumers. Buildings consume 40 percent of our Nation's energy 
and over 70 percent of America's electricity. Our homes are 
with us for generations. Many of our Nation's homes were built 
before there were appropriate energy codes or any energy codes 
at all.
    The fundamental rationale for investing in energy 
efficiency home retrofits is compelling and the outcomes are 
measurable and meaningful. Today, more than 80 million American 
homes are under-insulated. As a leading producer of insulation 
products, our best estimates tell us that each year 99 percent 
of U.S. homeowners will not re-insulate their homes without 
financial incentives. At the same time, our experience has 
shown us that financial incentives will drive people to invest 
in energy efficiency products when those incentives are 
meaningful and when the process to access them is simple and 
direct.
    Insulation reduces energy cost to a homeowner. A study 
published in 2007, by the global consultancy, MacKenzie, which 
Governor Engler referenced, reports that insulation is the most 
cost-effective way to reduce energy consumption and carbon 
emissions in the U.S. In the midst of the current economic 
downturn and with the national unemployment rate surpassing 
nine percent, putting Americans back to work to make energy 
saving investments is a good idea. HomeStar gives all Americans 
an opportunity to act and an opportunity to make a difference 
in creating jobs and saving energy. HomeStar's direct approach 
will drive demand and create sustainable U.S. jobs. By 
including rebates for insulation purchased on an installed 
basis or at retail, all American homeowners can participate in 
this program. This is good policy because there are certain 
consumers who prefer to do the jobs themselves. They should not 
be left out of the program.
    When we drive demand for insulation, we create U.S. jobs. 
The U.S. insulation industry is uniquely U.S. job-centric. 
Virtually, all of the insulation-related jobs, raw materials, 
manufacturing, delivery, sale and installation occur within 
several hundred miles of the U.S. home where the insulation 
will be installed. HomeStar can be a job creation bridge for 
thousands of unemployed insulation manufacturers and 
contractors who are awaiting the return of the U.S. housing 
market. Today, leading economists forecast that the housing 
market will not see a pronounced recovery until 2011 or 2012. 
Without HomeStar, the outlook for unemployment in our industry 
is not expected to improve any time soon. HomeStar is a great 
opportunity to create jobs, save energy, become more energy 
secure and reduce energy bills. Putting people back to work is 
sound economic policy. Making existing homes more energy 
efficient is sound energy policy.
    I urge you to take the necessary steps to ensure that 
HomeStar becomes law. I look forward to answering any questions 
that you might have. Thank you.
    [The prepared statement of Mr. Thaman follows:]



[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    
    Mr. Markey. All right, thank you, sir.
    Our next witness is Mr. Christopher Pratt and he is the 
Vice President of Construction Development Services in Troy, 
Michigan. He is here on behalf of the National Association of 
Homebuilders. Mr. Pratt has authored portions of training 
curriculum for the national homebuilders, Homebuilders 
Institute on Weatherization in Residential Housing so we 
welcome you, sir.

              STATEMENT OF CHRISTOPHER A.S. PRATT

    Mr. Pratt. Thank you. Good morning, Chairman Markey, 
Ranking Member Upton and members of the subcommittee.
    My name is Christopher Pratt. I am a construction design 
and energy specialist from Troy, Michigan with over 25 years of 
experience, as well as a weatherization instructor for a number 
of State programs. I am pleased to testify on behalf of the 
National Association of Homebuilders about the HomeStar 
proposal.
    Mr. Markey. How old were you when you began getting your 
experience, 25 years ago?
    Mr. Pratt. I tell people I grew up an SOB, a son of a 
builder so I grew up doing hard work.
    Mr. Markey. So like when you were five?
    Mr. Pratt. Fifteen.
    Mr. Markey. Fifteen, OK, good.
    Mr. Pratt. I am old. I don't look it.
    NAHB supports incentives for retrofitting older homes and 
believes this is the best way to achieve meaningful energy 
savings in the residential sector. We see the potential in a 
program like HomeStar to deliver energy savings and create jobs 
if it is crafted in a manner that will promote long term 
workforce development and craft trades for contractors doing 
weatherization work. NAHB has already successfully demonstrated 
its ability to manage federally funded retrofit programs like 
Project Reenergize in Minnesota. Late last year, the builder 
association there administered this rebate program with 
Stimulus funds and in a few short months over 1,400 homes were 
retrofitted, 800 contractors were employed and nearly $3 
million were returned to customers in rebates for energy 
efficiency upgrades.
    NAHB hopes to ensure that the HomeStar Program is equally 
accessible by all qualified, highly-trained contractors that 
have undertaken legitimate workforce training and possess 
appropriate job skills in weatherization. We are concerned with 
the limitations on the certified workforce definition in the 
current draft legislation. Specifically, NAHB requests the 
inclusion of the Homebuilders Institute or HBI as a qualified 
workforce development program. HBI is the largest jobs corps 
partner with the U.S. Department of Labor and has developed a 
robust weatherization curriculum that creates a career path for 
professionals doing retrofit work that will provide them with 
long term employability. While HBI includes a certificate 
component, the development of the worker base and a job skills 
training in retrofit work is the centerpiece of the program and 
meets the goal of creating jobs in the emerging retrofit 
industry that will outlast the short term incentives of the 
program. HBI is a legitimate workforce training program that 
deserves equal considerations with others listed in the draft. 
The weatherization curriculum, although newly introduced was 
developed via a thorough task analysis and skills assessment 
process and provides four levels of skilled training, 
apprentice, weatherization worker, weatherization specialist 
and energy analyst. The curriculum includes course work 
covering everything from basic theory to calculating heat loss, 
in addition to hands-on practicum that teaches workers how to 
install 80 different weatherization products and perform 45 
different installation activities. It is structured to 
accommodate all standards in use and can be administered and 
offered through a network of community colleges around the 
country among others.
    For example, I am currently teaching--I am currently 
training workers in this program in Houston, Texas as part of a 
Workforce Investment Grant. The program is currently being 
delivered throughout a number of partnerships with Goodwill 
Industries, the Carpenters' Union, Ferris State University, 
among other. Above all, the program is about equipping workers 
with the appropriate job skills to serve them for their entire 
career and not just selling a certification credential. In that 
regard, HBI is considered a legitimate workforce development 
program along with other currently listed in the draft.
    Another important item that may affect a successful 
implementation of HomeStar is the effective date of an EPA rule 
covering renovation and retrofit work in pre-1978 homes 
beginning on April 22 of this year. Unfortunately, EPA does not 
have enough certified renovators that can legitimately work to 
retrofit older housing that the HomeStar Program hopes to 
target. Contractors cannot meet the EPA's certification 
requirements for the Lead Renovation Repair and Paint Rule by 
April 22 and will be breaking Federal law if they work on pre-
1978 homes. NAHB supports lead-safe work practices as well as 
retrofit incentives but unless compliance issues with the lead 
rule are addressed I believe this could deter work in older, 
less efficient homes. NAHB supports retrofitting older homes 
and we are truly the experts in this field. We support the 
benefits in both job creation and energy savings that the 
program like HomeStar could deliver but we are wary of the 
potential limitations such as the exclusion of HBI and the 
effective date of the EPA rule. We believe both of these issues 
if not addressed could ultimately limit the impact of HomeStar.
    I appreciate the opportunity to be here and present our 
thoughts on this proposal and we look forward to working with 
you. I would be happy to answer any questions.
    [The prepared statement of Mr. Pratt follows:]



[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    Mr. Markey. Thank you very much, Mr. Pratt.
    That completes the time for opening statements of our 
witnesses. We will now turn to questions from the subcommittee 
members.
    Ms. Zoi, Governor Engler mentioned this morning a program 
announced by Vice President Biden. Could you talk about that 
program and how it dovetails with the program that we are 
talking about here today?
    Ms. Zoi. I think what Governor Engler was referring--how is 
that, better?
    Mr. Markey. Yes, fine.
    Ms. Zoi. I think what Governor Engler was referring to is 
an extension of the 48C Advanced Manufacturing Tax Credit, is 
that right? So that is a program that was part of the Recovery 
Act that gives tax breaks for establishing new manufacturing 
facilities in the United States that are in the clean energy 
sector. The program was over-subscribed, $2.3 billion has been 
allocated to companies that are getting things going over the 
next couple of years that they will create lots and lots of 
jobs in wind, and solar, and energy efficiency technologies, 
and combine heat and power but because it has been so wildly 
over-subscribed, the Vice President is proposing that we 
actually extend that program and top up the money to the tune 
of $5 billion.
    Mr. Markey. OK, so we would need to authorize that as well?
    Ms. Zoi. Yes.
    Mr. Markey. And you support that, Governor Engler?
    Mr. Engler. Yes, we can.
    Mr. Markey. Yes, do you support putting the $2 billion back 
in for wind and solar that we took out for the Cash for 
Clunkers Program as well, Governor?
    Mr. Engler. I haven't looked at that but, you know, we 
would certainly be open to talking about that. I mean I guess 
we look at this sector as being so hard hit that any number of 
these strategies we think can be fairly quickly effective at 
putting people back to work but certainly, we are here on 
HomeStar today because we just think that does put people to 
work.
    Mr. Markey. You were just saying good things about the 
other program so I was just hoping we could just have you get 
on a whole list of programs.
    Mr. Engler. You might as well press on there, I understand. 
OK, now I got you.
    Mr. Markey. And the Administration supports putting the $2 
billion back in for the wind and solar?
    Ms. Zoi. My understanding is that that provision might have 
been included in the first jobs bill that was just passed but 
we should go back and check but yes, of course.
    Mr. Markey. OK, great, I appreciate it.
    Ms. Zoi. Of course.
    Mr. Markey. So how many jobs will this program create, Ms. 
Zoi?
    Ms. Zoi. Somewhere in the tens of thousands, I mean I think 
the HomeStar Coalition has done a direct and indirect jobs 
estimate of 160,000. The direct jobs would be 60 to 70,000, 
lots and lots of important jobs.
    Mr. Markey. Great. Governor Engler, what is your hope for 
new jobs created by a program like this?
    Mr. Engler. We think that this has the potential--I am just 
checking my testimony to make sure I got my number right. I 
think I said sort of like the Secretary. I think it is 168,000 
but I want to make sure that I get that number right.
    Mr. Markey. Mr. Thaman is nodding his head.
    Mr. Engler. We just think that the design of this so that 
the homeowner actually once it is passed they can go forward. 
You are going to have the private sector really running the 
program. We would hope that the reimbursement would work better 
than it did with the Cash for Clunkers but I think everybody 
learned lessons off that and that would happen but Mr. Pratt's 
mention of the lead issue is kind of an interesting one. That 
probably need to also be attended to because you could--I 
happen to be in a home that was built before 1978 and so, you 
know, I am not sure I can get Mr. Pratt to come and take care 
of that so you can have a lot of people caught in that 
inadvertent situation so part of the cleanup would be good and 
I also would support his suggestion on HBI.
    Mr. Markey. Thank you, Governor.
    Mr. Thaman, we have heard complaints that HomeStar picks 
winners and losers for home products. Could you talk a little 
bit about the Gold Star Program creating a higher reward 
program for any product that achieves at least 20 percent home 
energy efficiency?
    Mr. Thaman. Well, I think there is two ways to look at 
improving the energy efficiency of a home. You can either look 
at the products that we know and have been demonstrated to 
improve energy efficiency or you can have performance raters 
come in and rate a home. I think there is a good balance 
between Silver Star and Gold Star to target and Silver Star's 
specific products and initiatives that we know save energy and 
then Gold Star have a more holistic approach, actually rating 
the home and testing the home for energy efficiency 
improvements. We know based on our history as an insulation 
manufacturer that any time you install more insulation you 
improve the energy efficiency of a home so it is a pretty safe 
bet to directly fund that initiative.
    Mr. Markey. OK and, Mr. Pratt, could you talk about the 
Gold Star Program and how that does reward any product that is 
more efficient.
    Mr. Pratt. As an energy rater myself, I personally believe 
that the performance based tests tend to be more efficient or 
guarantee or help improve the chances that the improved 
measures were installed correctly. So I also do some training, 
Mr. Upton might be aware, of the warm or excuse me, the program 
in Michigan where they go around and help homeowners install 
products in their existing home. I find sometimes when you are 
up in an attic space and it is 140 degrees, you spend less time 
working on the insulation then you do trying to get out of the 
attic space. So a lot of times there are good efforts put into 
tests but sometimes they don't get all installed the way you 
would like them to be installed.
    Mr. Markey. OK, thank you, Mr. Pratt.
    Let me turn and recognize the gentleman from Michigan, Mr. 
Upton.
    Mr. Upton. Well, thank you, Mr. Chairman, and I, you know, 
as I have talked to some of my colleagues on our side and heard 
some of the opening statements there is clearly some skepticism 
on this bill and in large part, you know, as we looked at the 
DOEIG report issued last month of the $4.7 billion that was 
awarded in grants under the Stimulus Plan, only $368 million 
has been used by the States so far and only some 30,000 that 
have been used. And I, you know, this was supposed to be a 
shovel-ready program, ready to go and clearly there was some 
need and as we look at the way that the Cash for Clunkers 
Program was administered, I mean I think most of us thought it 
would be pretty easy to do. You got 25,000 auto dealers across 
the country. There were provisions on fraud and abuse that were 
in place. You had to show that the car had been insured, 
actually would run and, you know, it had to meet the mileage 
requirements that anyone could figure out from the Internet and 
the dealers were supposed to be reimbursed I want to say within 
7 days. And I bet everyone of us here on both sides of the 
aisle heard from lots of our dealers saying it has been more 
than a month. We have got dozens of cars sometimes some of the 
larger dealers 50-100 cars the Department of Transportation 
hired more than 1,000 people. I mean that is, you know, they 
only had to make about two calls to a dealer per day to figure 
all this out with the documentation to get them done and it 
didn't happen. And now you are talking about a program that may 
be as large as eight times as more. This was a $3 billion 
program, Cash for Clunkers, over a limited span of time. They 
did 750,000 vehicles. You have got more builders. There is 
already a tax credit that is in place for homeowners to make 
whatever adjustments that they want up to I think it is $1,500 
tax credit on work that has to be at least that is what a 30 
percent tax credit on business that is done and as we look at 
fraud and abuse and how is at DOE that you are going to be able 
to determine whether people did both. They actually took a tax 
credit and then they did a deal with their builder that is 
supposed to be passed through them. Why not just keep it as a 
tax credit and let the power of the IRS make sure that there is 
some compliance versus what you are going to have to do in 
terms of additional staff and certification and everything 
else? Do you see where the skepticism comes on our side?
    Ms. Zoi. And I would love to.
    Mr. Upton. Yes, go ahead.
    Ms. Zoi. A very good series of issues that you raised and I 
welcome the opportunity to talk about first of all, how we the 
structure that we have in mind for this which is designed to 
leverage private sector expertise that is already taking place. 
The design for the main Government function is to prevent 
waste, fraud and abuse and to publish eligibility standards for 
the contractors that are capable of doing the work. I would 
also like to take a moment if I may to update the committee on 
the data about the Weatherization Program. So, in fact, why 
don't I take that one first?
    Mr. Upton. OK.
    Ms. Zoi. So the Weatherization Program as you point out is 
about a $5 billion program. The Recovery Act didn't double 
weatherization. It didn't triple it. It multiplied it times 25 
so 900 community action agencies had to spend a few months 
hiring more people. We had it was the first time ever that 
Davis Bacon wages were applied. The Labor Department had to 
determine what fair wages were. So the community action 
agencies spent the summer months hiring, training, figuring out 
the Davis Bacon wages. The ramp up well and truly started in 
the fall. We tripled the number of homes that were done between 
September and December. The ramp rate that we need to be at to 
meet the overall goals for the program by March, 2012, is about 
20 to 25,000 homes a month. We estimate in February there was a 
short month and it was a snowy month in most of the country but 
we did probably 17,000 homes so we are within striking distance 
to our max ramp rate that is required. This is actually a great 
tribute to the ability of these 900 community action agencies 
to ramp up quickly. So it took longer then expected to get 
going but I would also I applaud what Congressman Barrow 
pointed out, this was a program that is 30 years old. It has 
certain structures in place. The Federal Government has to give 
money to the States. The States then give money to the local 
community action agencies. It is a well-established network. We 
are designing the HomeStar Program to not have be encumbered by 
some of those same things that service the low income community 
only so what we have then done is pivoted and said well Cash 
for Clunkers may have had a few hiccups.
    Mr. Upton. A few.
    Ms. Zoi. Because it required 9 pdf to be submitted for 
every single transaction as you pointed out so what we have in 
mind here is something that uses modern IT that has a list of 
we work very closely with rebate aggregators who are the 
network managers for the sector. They put together, we put 
together a simple form that is filled out by all the certified 
contractors. Those eligibility criteria are all listed and then 
with the Federal what the Department of Energy has to do is 
ensure once the rebates are aggregated and submitted we do the 
reimbursement. The second part of it is establishing a quality 
assurance program and we work in partnership with the States 
because again they are the ones who have home inspector 
networks and what we do is capitalize on the fact that even 
some of those home inspectors are don't have much to do these 
days. We put those guys back to work. They are part of our 
quality assurance scheme where the States that are not quite 
ready to do the quality assurance, the Federal Government 
provides that default function. So we are absolutely taking 
very seriously the concerns that you have raised about other 
programs, taking it to heart and we feel very strongly that we 
can establish this program to get going as quickly as possible 
to get people back to work.
    Mr. Upton. I know my time has expired so I yield back. 
Thank you.
    Mr. Markey. The gentleman's time has expired.
    The chair recognizes the gentleman from Pennsylvania, Mr. 
Doyle.
    Mr. Doyle. Thank you, Mr. Chairman.
    Secretary Zoi, and you have just started to touch on this 
and I want you to expand on it further. A few years ago in my 
State of Pennsylvania, we had an internal audit of the 
Weatherization Assistance Program and it resulted that there 
was a backlog of nearly 9,000 applicants for the program, many 
of them constituents of mine that qualified for the program 
were stuck in this backlog and though the program was federally 
funded it was administered by Pennsylvania's Department of 
Community and Economic Development. So while I am very 
obviously excited about the HomeStar Program, I want to see it 
get going. I am a little concerned about the backlog. I just 
want to ask four quick questions and have you just comment on 
them and I think some of them you have touched on already. Is 
EPA prepared to process the rebates the contractors in the 30-
day timeframe set out in the bill and what portion of this will 
be the State's responsibility? Do you foresee that it will 
require additional staff at DOE or EPA and at the State level 
to process these rebates? Will small businesses be able to 
process the rebates in the same timeframe as big box retailers 
like Home Depot or Lowe's? And then finally, I am concerned 
about the quality assurance measurement and how will we make 
sure that the work that is being done is good work? Homeowners 
are going to be able to measure the success of their work by 
their energy savings and this means that we don't have much 
margin for error. Can you explain how the contractors will be 
certified and who is going to be responsible for the oversight 
of the installations?
    Ms. Zoi. Yes, OK so the 30-day processing the answer is 
yes, we will absolutely do the 30-day processing. The small 
business eligibility again what we want the rebate aggregator 
concept is so that a variety of experts in the field, sector 
specialists, can help the small guys with what they need and be 
able to contribute so rebate aggregators might be the big box 
guys. They might be utilities. They might be existing home 
performance with Energy Star States that work very well with 
small businesses in bundling up those.
    Mr. Markey. Ms. Zoi, could you move that microphone in just 
a little bit closer, please, just pull it in.
    Ms. Zoi. How is that?
    Mr. Markey. OK, good.
    Ms. Zoi. So there are a variety of ways that the small 
business folks will be able to play and will be able to get the 
attention that they need quickly through the proposed 
structure. In terms of quality assurance for the contractors 
again, what we envision is that 20 percent of the jobs will get 
a field inspection, a post expert field inspection that folks 
that sign up for the program will agree that they will be--that 
they will make their home available for quality assurance 
because consumer confidence that they are going to get quality 
work is very, very important. There are a variety of 
contractors that are out there that do QA right now that will 
be part of this program. Again, the idea that we have got is 
that we lean on the States to be overseeing the programs that 
are happening within their States and again that what we are 
doing is we are leveraging work that is already happening right 
now and building on it and amplifying it to move quickly.
    Mr. Doyle. So what are we doing to make sure that States 
have sufficient manpower and personnel to make sure this, you 
know, how do we ensure that, you know, the State of 
Pennsylvania who had a 9,000 case backlog administering this 
program that this doesn't happen again. What onuses are put on 
the State or what responsibility is put on the State to make 
sure they have sufficient personnel to do this, too?
    Ms. Zoi. Well, there is financial--if the bill passes in 
its current formulation there are financial resources that are 
allocated to the States to be able to stand up those good 
quality assurance programs.
    Mr. Doyle. OK, thank you.
    Ms. Zoi. And just to your backlog question on 
weatherization.
    Mr. Doyle. Yes.
    Ms. Zoi. Unfortunately, there are 40 million people in 
America that are eligible for the low income program. We have 
been working very closely with Governor Rendell and the State 
of Pennsylvania and that program I think in Pennsylvania you 
are going to see a whole new set of Weatherization Program 
going forward so hopefully you will have that backlog will be 
reduced substantially in the coming year.
    Mr. Doyle. Yes, I mean it is a good program but we want to 
see it work as good as possible so thank you, Mr. Chairman.
    Mr. Markey. Great, the gentleman's time has expired.
    The gentleman from Pennsylvania, Mr. Pitts.
    Mr. Pitts. Thank you, Mr. Chairman.
    Madam Secretary, has DOE analyzed whether there are legal 
requirements that may delay the rollout of the HomeStar 
Program? In particular, will DOE have to take any actions to 
comply with the National Historic Preservation Act?
    Ms. Zoi. That is an excellent question, Congressman Pitts, 
because it has been some of those issues that have slowed down 
the implementation of the Recovery Act. The way the bill is 
currently configured what our lawyers tell us is that we will 
be able to stand up the program within 60 days of passage. We 
have to do an administrative rule, that is what the lawyers 
tell us but because of the structure of the law and because 
much of it is embedded in the statute, we will be able to do 
this very quickly.
    Mr. Pitts. Will DOE have to prepare an environmental 
analysis under NEPA? What kind of environmental review of the 
program would need to be done and how long would that take?
    Ms. Zoi. Again, what is envisioned here is similar to what 
happened with the categorical exclusion of the Weatherization 
Program is that essentially it is a very quick, simple, 
straightforward rulemaking because the environmental impacts of 
doing home retrofits are not material so therefore an 
environment assessment will unlikely be required but again it 
is a very quick process that won't inhibit speed at all.
    Mr. Pitts. Will there be any requirements that will need to 
be complied with under the program in terms of rates paid to 
contractors labor costs?
    Ms. Zoi. Again, no Davis Bacon would not apply to this so 
no.
    Mr. Pitts. In the event that in carrying out the program 
workers are injured or homes are damaged is there any risk of 
additional tax bearer liabilities?
    Ms. Zoi. Again, the way we have tried to structure the 
program is to build on existing contractor relationship 
certifications licensing and bonding so to the extent that only 
licensed bonded workers are part of this program that would be 
covered by whatever insurance they currently carry.
    Mr. Pitts. OK, thank you.
    Mr. Laseter, I have some questions about small business 
involved in retrofitting industry and how they would benefit 
from the program. In your written testimony you reference 7,000 
companies that make or install windows, 82 percent of which are 
small businesses. Of these, how many would you estimate are 
eligible to participate in the HomeStar Program?
    Mr. Laseter. Under the Silver Star Program, it is 
structured to for anybody as the Secretary said who is licensed 
and insured according to that State can immediately participate 
in the Silver Star Program so we would expect all of those 
contractors, those small businesses who wish to participate can 
participate immediately.
    Mr. Pitts. And would that also apply to the reference you 
have for 22,000 insulation installers?
    Mr. Laseter. Yes, sir, that is the reason again the Silver 
Star Program was structured in a way so that those existing 
small businesses, you know, as long as they are properly 
licensed and insured could participate immediately.
    Mr. Pitts. In your testimony, you indicate 168,000 jobs 
would be anticipated to be created, three million homes would 
be retrofitted. Is this based on an estimate of $6 billion in 
funding over 2 years?
    Mr. Laseter. Yes, sir.
    Mr. Pitts. And what are the assumptions underlying the 
estimate that three million homes would be retrofitted?
    Mr. Laseter. We can follow-up with the written reports. We 
used the report from AC Triple E and Climate Works who relied 
heavily on the MacKenzie study and other published works to 
come up with those estimates but the HomeStar Coalition would 
be happy to submit the detail.
    Mr. Pitts. Governor, as far as job creation in the 
manufacturing sector is concerned, what impact would a fully 
implemented HomeStar Program have in comparison to new home 
construction returning to pre-recession levels?
    Mr. Engler. Well, I don't know what the new home 
construction gets back to. I said in my testimony if we got 
back to where we were there is an additional 128,000 jobs. I 
mean these are all estimates. Could HomeStar if we suddenly are 
able to reach three million homes you get a lot of impact that 
is not all right in manufacturing because there is a lot of it 
in the service sector as well that is dependent on 
manufacturing and manufacturing is dependent on service people 
being busy so we can make products for them. I don't have a 
hard number on that.
    Mr. Pitts. Are there any other programs you would like to 
see included or does HomeStar exclude any beneficial energy 
efficient products or improvements for the home?
    Mr. Engler. The committee draft there were some concerns on 
some of the do-it-yourself work that could be done. There has 
been some modification I think that recognizes some of that and 
as I think Mr. Thaman testified there is in the Silver Star 
there are things that can get done very quickly. In the Gold 
Star you are pretty much wide open to I mean if you want to do 
an entirely new HVAC, new water heaters, new whatever it is all 
there for that so I think it has done a pretty good job. I 
realize I mean the intention is we would like to move quickly 
to get this gone. In fact, I would like to see the agency 
commit to 30 days to be done. I don't know what there minimums 
are but, you know, most it shouldn't take 60 days of government 
work to write a simple rule, first draft it is a pretty 
straightforward. That ought to be--the draft ought to be done 
now at the agency so the minute it is signed and the rule is 
filed that we can accelerate this because we got to get away 
from government time and go to private sector time which is 
much, much more aggressive.
    Mr. Pitts. Well, the do-it-yourself, Mr. Thaman, provision 
in the latest bill draft is $250. Do you know how much the cost 
for insulation of an average home this would cover?
    Mr. Engler. I will turn to Mr. Thaman. We have got an 
expert sitting next to me on that one.
    Mr. Thaman. You know, again it is going to depend whether 
you have an insulation contractor coming in to install the 
product for you or not but in a typical home if you were to go 
and buy a product at a big box retailer and bring enough 
product home to restore at least the attic portion of your home 
to today's energy codes, certainly for $800 or $1,000 you could 
buy enough product to bring your attic up to code so we would 
expect for the $250 rebate that that is a pretty good size 
incentive to encourage people to want to go do that project.
    Mr. Pitts. Thank you, I have gone over time, sorry.
    Mr. Markey. The gentleman's time has expired, no problem.
    The chair recognizes the gentleman from Vermont, Mr. Welch.
    Mr. Welch. Thank you very much, Mr. Chairman.
    Mr. Engler or Governor Engler, I did some careful research 
about your background before this hearing and I understand you 
are a Republican.
    Mr. Engler. Well, I was certainly elected that way 10 
times.
    Mr. Welch. Well, what I want to ask you if you are here 
supporting a program that is advanced by a Democratic 
Administration, it is being advanced by some of our best 
manufacturers and environmentalists, it is supported by 
management and labor, by homebuilders and homeowners, do you 
get nervous being in that company or should we take this as a 
suggestion that maybe this is a good idea?
    Mr. Engler. Well look, the last time I checked with 10 
percent unemployment rate we have got a lot of unemployment for 
Republicans and Democrats with enough to go around out there so 
we would like to put people back to work. We think this does 
that and from the manufacturing perspective, we just want to 
see things put in place that will work, that will work quickly 
and get us back on a road to recovery. There is simply not 
enough demand in this country.
    Mr. Welch. And that is the point and I really do very much 
appreciate you being here. The other question that is 
legitimately raised is always about details about practical 
implementation and I just ask this of the panel. This is 
intended to be designed so it is simple. You are relying on our 
local manufacturers like Owens Corning and Masco that are 
already in this work but need more demand. You are relying on 
contractors who are not building homes but know how to retrofit 
homes so we don't have to do all kinds of training, and we are 
relying on homeowners who are going to have to get in the game, 
and if I get a $1,500 rebate or pre-bate but I have to put 
$1,500 of my own money in, as a card-carrying, free market 
Republican do you have some confidence that I am going to make 
certain that if I put $1,500 in, the tax payer puts $1,500 in, 
I am going to want to get not $3,000 but maybe $4,000 worth of 
value.
    Mr. Engler. There is no question about that. That is 
exactly right and this is very different then one member has 
asked the question about weatherization earlier. I mean if this 
were going to be running through CAP agencies I would be here 
opposing it.
    Mr. Welch. Right.
    Mr. Engler. This is not going to do that. This is going to 
go to private sector.
    Mr. Welch. Yes, it is private sector. It is private 
homeowner and, Mr. Laseter and Mr. Thaman, does this create 
hassles for you, this program? Sometimes programs come up and 
they have all kinds of strings attached and burdens imposed on 
you or does this allow you to be more successful just by doing 
what you do but do more of it?
    Mr. Laseter. Yes, I think the strength of the HomeStar 
Coalition was having a broad input from, you know, industry, 
labor, environmental groups and, you know, national 
associations and State energy officials so a lot of players who 
have done this for many years with a heavy focus on the 
industry. This program is simple for the customer because the 
consumer gets an instant rebate. It is going to be simple for 
the contractor. They fill out a form to send to get their money 
back and that is one of the reasons this thing is going to 
work.
    Mr. Welch. Right.
    Mr. Thaman. Congressman Welch, in my testimony I said that 
it is important that this be simple, it be meaningful and it be 
direct. I think one of the key things here is homeowner 
education and if we give the private sector an incentive to get 
out there and market the idea and sell the idea I think you are 
going to get a multiplier affect as opposed to having a 
Government agency try to do it.
    Mr. Welch. Right and, Mr. Pratt, we have got the workforce 
out there that wants to get to work?
    Mr. Pratt. Yes and we have an opportunity to use the 
existing 800 homebuilder associations to do training if that is 
the case.
    Mr. Welch. OK and, you know, Secretary Zoi, I do know that 
you have heard from these folks and others that simplicity is 
the key here. That partnership between the public and the 
private using what we have, not reinventing something new to do 
something that needs to be done and we know how to do it. 
Governor Engler suggested speed is of the essence and 
simplicity is of the essence. My sense is that you are very 
committed to speed and simplicity, and I just wish you would 
comment on that.
    Ms. Zoi. Well, absolutely, we and I have spent about half 
my career in the private sector trying to get things done 
quickly and Government is not always famous for that. This 
program has been designed to utilize and harness the very 
strong presence and knowledge of all of these sector experts 
that are in the private sector now and to leverage the 
marketing capability, as I think as Michael just mentioned so 
we absolutely have this in mind. We all need to do this if we 
can do it quickly and we can do it quickly.
    Mr. Welch. OK, well, I look forward to working with my 
colleagues on trying to address whatever suggestions they have 
to make this simpler and more efficient.
    I yield back. Thank you.
    Mr. Markey. Great, the gentleman's time has expired.
    The chair recognizes the gentleman from Illinois, Mr. 
Shimkus.
    Mr. Shimkus. Thank you, Mr. Chairman, and as I start we 
have our fine technician working on our thermostat right here 
perfectly timed. Wave to everybody so it is great timing maybe 
we can include.
    Mr. Markey. It is a very old-fashioned thermostat.
    Mr. Shimkus. That is right. We need some Government money 
to do that.
    Let me and it is great to follow my friend and colleague, 
Peter Welch, who has been working very diligently on this. I 
also find it curious when a progressor really takes a free 
market competitive stance. I think what Republicans and 
conservatives are worried about right now is our national debt, 
all consuming above everything else. In 2009, our budget was 
$3.2 trillion, our deficit was $1.3 trillion and our debt was 
$12.3 trillion. In 2010, our budget was $3.3 trillion, our 
deficit $1.3 trillion and our debt was $14.5 trillion. That is 
debt. This year we got a $3.4 trillion budget, a projected 
$1.65 trillion deficit and a debt that is going to hover around 
$15.7 trillion so a lot of the concerns that we have over here 
is how will we pay for this and does anything on the panel want 
to suggest how we are going to do that?
    Ms. Zoi. The President has suggested previously paying for 
this out of TARP, their funds.
    Mr. Shimkus. And wasn't the TARP legislation originally 
passed that that would go down to pay down the debt?
    Ms. Zoi. And I guess I would suggest.
    Mr. Shimkus. Was that what the law says on the TARP funds, 
correct, right now? The answer is yes so that is not an answer. 
That is taking legislation that we had designed to pay down the 
debt as the TARP funds got paid back and now using it to fund 
another program which is not solving the problem of a pay-for.
    Ms. Zoi. I think this is part of a jobs proposal and I 
think what we find ourselves in is that we still, the economy 
still needs.
    Mr. Shimkus. So you are not predicting a pay-for for this?
    Ms. Zoi. I think that the Congress should work out with the 
Administration the best way to pay for this.
    Mr. Shimkus. OK so you want a pay-for for this?
    Ms. Zoi. We want the bill to be passed so that we can get 
these people back to work.
    Mr. Shimkus. Well, do you want this paid for or not?
    Ms. Zoi. I think that we would like to.
    Mr. Shimkus. Or do you want to go into further debt? That 
is the question I mean you are from the Administration. Do you 
want this paid for or do you want us to go and continue debt 
and deficit spending?
    Ms. Zoi. I think we will need to have conversations to work 
this out together.
    Mr. Shimkus. You know that on the House side we have pay-
for legislation. Would you think that is important for us to 
continue to abide by our pay-go rules now in the House that 
this be fully paid for?
    Ms. Zoi. I think that is a matter for your consideration.
    Mr. Shimkus. OK, the Administration has no position on 
whether this should be pay-for or not?
    Ms. Zoi. We would like to work with you to get the bill 
passed.
    Mr. Shimkus. OK, thank you very much.
    Anyone else want to talk about whether national debt is 
something to be concerned about?
    Mr. Engler. Sure, I will take a piece of this. I mean you 
have got to realize that the Department here is on the spending 
side. You have to, Mr. Orzag and the budgeters in here I guess 
but from the manufacturing perspective there are a number of 
things that we ought to do as a Nation that would be both 
useful in terms of having a growth strategy and I think 
important to reduce the debt. I will throw one where there is 
$60 billion of exports riding on fixing the export control laws 
that are antiquated in this country. We could export more of 
our technology goods. We ought to do trade policy more 
effectively and there are a lot of jobs there. I think we also 
need to look at as people go back to work and are working, the 
economy is growing there are actually more taxes then even in 
the '90s. If we look it was really economic growth that had a 
big contribution as well as fiscal spending restraint that 
happened and I think when you have got the unemployment rate at 
double digit levels where we are today that these kind of 
programs ought to be looked at as how many people go back to 
work, how many taxes they will pay and how that fits in but 
there is a whole host of other things that I would.
    Mr. Shimkus. Yes and let me finish with this, Governor 
Engler. I appreciate your position and comments. There is a lot 
of uncertainty out there in America today, especially in the 
manufacturing sector. Does movement to an energy legislation or 
climate legislation provide more or less certainty in the 
manufacturing sector?
    Mr. Engler. It is helpful because energy security is very 
important to manufacturing.
    Mr. Shimkus. What about climate?
    Mr. Engler. Well, I think it is helpful in showing that 
there are market-oriented solutions that will work.
    Mr. Shimkus. What about the increased cost of energy that 
will be passed on to the manufacturing sector?
    Mr. Engler. Well, this actually helps to reduce that.
    Mr. Shimkus. No, I am not talking about this. I am talking 
about climate legislation.
    Mr. Engler. Well, we have a number of issues with the 
chairman on when we get to that question and hopefully----
    Mr. Shimkus. Well, that is why we have you here. We get a 
chance to ask you about these all-pressing issues.
    Mr. Engler. I am happy to spend time on that if you wish, 
if you want to go there.
    Mr. Shimkus. I know you are. My time has expired. Thank 
you.
    Mr. Markey. I thank you, Governor, you did not know--you 
did not have an answer to my extraneous questions so thank you 
for not having an answer to Mr. Shimkus. You are very 
consistent and you are very consistent in your testimony.
    Mr. Engler. I realize who is chairing, Mr. Chairman.
    Mr. Markey. I know you have an answer to both of them 
actually but thank you for staying on point here.
    The chair recognizes the gentleman from Georgia, Mr. 
Barrow.
    Mr. Barrow. Thank you, Mr. Chairman.
    Just following up on the theme that has been raised several 
times about how to make this as low-maintenance, as user-
friendly as possible. What will the customer, the taxpayer, the 
homeowner actually experience? What will the experience be like 
for the man or the woman that we are asking to basically we are 
trying to get to nudge in this direction because as Mr. Welch 
has pointed out, folks are going to have to have some skin in 
the game and we want to give folks an encouragement, a proper 
encouragement. We don't want to discourage them with something 
that is bureaucratic, involves a hassle, involves making them 
think about things that actually try and get in the way of 
doing what is even in there rational best interest to use a 
behavioral economic-type approach to this problem. Who can 
describe what the experience is going to be like for the 
customer? What are the things that they get to consider and 
what is it going to be like and especially comparing and 
contrasting this with another approach, let us say a tax credit 
approach which I think has certain advantages but also certain 
disadvantages in terms of encouraging folks to do things right 
away giving them the feedback, the positive feedback right 
away? Who wants to take a, Mr. Laseter, would you like to take 
a stab at that?
    Mr. Laseter. I am happy to give an answer as a contractor 
serving customers.
    Mr. Barrow. Thank you.
    Mr. Laseter. When we go in the home today we do proposals 
today as general contractors big and small do every single day 
in America, and under this program we can add a line item that 
will say here is your instant rebate under the HomeStar Program 
and subtract that amount so the customer pays the total minus 
the instant rebate to us. That is the customer experience. 
There is not a research do I qualify for the tax credit. I have 
to pay you now and go out-of-pocket and I get my tax credit 
back next year.
    Mr. Barrow. Hopefully.
    Mr. Laseter. Right that, excuse me, is a point of sale from 
the homeowner's perspective when they are buying or purchasing 
they are getting an instant rebate and that is the difference 
and what will really drive some consumer demand.
    Mr. Barrow. How about for the retailer though, the 
manufacturer, the folks who are being who are coming up with 
the materials to be sold and installed? What is the experience 
like for them?
    Mr. Laseter. Yes, from the perspective of the supply chain 
after that, as a contractor I submit my paperwork to get my 
instant rebate. That is applied directly to again contractors 
big and small who participate in the program and then we buy 
through distribution channels that may be at retail. They may 
be, you know, direct. They may be, you know, through 
distributors that are in the marketplace for these different 
products and services. So the money, you know, just goes all 
the way up the supply chain that exists today.
    Mr. Thaman. And from an Owens Corning perspective as is the 
case I think of most the manufacturers, you know, the nature of 
our business would not change dramatically in terms of how we 
invoice or get reimbursed by our customers. Hopefully, it would 
change because there would be more demand and obviously with 
our distinctive pink brand and our brand name we talk to 
homeowners all the time. We talk to retailers all the time. I 
think you would expect companies like ours to be very 
aggressive about helping promote these ideas and get homeowners 
to understand that for a limited time, they have an opportunity 
to do something good for their home, good for their energy bill 
and good for the environment.
    Mr. Barrow. Thank you.
    And with that, Mr. Chairman, in the interest of letting 
some others have some of the time remaining, I yield back the 
balance of my time.
    Mr. Markey. Great, we thank the gentleman.
    The chair recognizes the gentleman from Alabama, Mr. 
Griffith.
    Mr. Griffith. I am sorry. Thank you, Mr. Chairman, I am 
sorry I was late coming back in but the suppliers of the 
windows and other materials, those we heard that they were 
going to be mostly American manufacturers and is there any way 
to ensure what percentage that might be or is that germane? Is 
that an important question?
    Mr. Thaman. Well, you know, I can start by talking about 
the insulation industry. I mean insulation is kind of uniquely 
U.S. centric because it is a very lightweight, low value 
product and so you can't ship it very far. So the nature of the 
product is we make fiberglass insulation; our input materials 
are sand. Our sand suppliers and our bag suppliers are very 
close by to us. We manufacture close to the market. Our 
trucking firms are very close to us. Our contractors live in 
the communities in which they install. So we see a supply chain 
that begins and ends right in the United States without any 
need for any intervention to say this needs to be U.S.-based.
    Mr. Griffith. Thank you.
    Mr. Engler. Specifically on windows, the window and door 
manufacturers were in town this week and all over the Capitol, 
but that again is the kind of product given its weight, it is 
actually being produced in many, many States close to the 
markets. It is not something that you ship from across the 
world here for the domestic door-window, windows in particular.
    Mr. Griffith. Thank you. I agree completely. Where are the 
most obvious areas for abuse of this program? Would it be in 
the contractor? Would it be in the invoicing? Is there any 
competition for a customer to get a second bid on the cost? How 
does that work?
    Ms. Zoi. Well, what we intend to set up is a system that 
does not allow rebates or double rebates so again what the 
limiting factor will be one measure, one eligible measure per 
address and the system, once that gets admitted we won't accept 
double claims so again you can design that with modern IT and 
not allow, I mean just as if you are online shopping and you 
haven't filled out a field you get a little red signal. It is 
like uh-oh, you know, 234 Main Street has already gotten an 
official water heater through this program. They can't do it so 
again, we are going to set up a system that doesn't allow that.
    Mr. Laseter. And if I may, from a customer's perspective, 
this is a market-based program. The customer can shop as many 
general contractors as they would like to shop to get the best 
price before they decide to do the home improvement so again we 
think the strength of the program is it is so market-based.
    Mr. Griffith. I appreciate those answers and they are 
comforting and I appreciate that.
    Mr. Chairman, I yield back my time.
    Mr. Markey. Great, the gentleman's time has expired.
    The chair recognizes the gentlelady from California, Ms. 
Capps.
    Mrs. Capps. Thank you, Mr. Chairman, and before I begin, 
may I ask unanimous consent to enter into the record two 
statements each in favor of the HomeStar and Lead Renovation 
Rule?
    Mr. Markey. Without objection, they will be included.
    Mrs. Capps. One is from the Labors International Union of 
North America and the other is from the American Public Health 
Association.
    Mr. Markey. Great, without objection, so ordered.
    [The information appears at the conclusion of the hearing.]
    Mrs. Capps. Thank you very much.
    As you know, Mr. Chairman, in 1992, this committee held 
hearings on a serious problem, hundreds of thousands of 
children being harmed by exposure to lead which damages the 
development of the brain and nervous system. This committee 
took action and passed the Lead Exposure Reduction Act on a 
bipartisan vote of 39 to 4. That legislation reduced lead 
hazards in a number of ways including by requiring EPA to 
identify lead-safe remodeling and renovation practices and to 
make sure that contractors were trained in these lead-safe 
practices. Now, almost 20 years later, EPA has developed these 
commonsense rules and they will finally go into effect next 
month.
    Now, Mr. Pratt, you have suggested in your testimony that 
these long, overdue projections for children's health should be 
further delayed in conjunction with the HomeStar Program and I 
find this particularly very troubling. I wonder if you are 
aware that the EPA and Centers for Disease Control estimate 
that one million American children are exposed to harmful 
levels of lead that damage the development of their brains and 
nervous systems, often irreparably?
    Mr. Pratt. Yes, the point that I was trying to make was 
that there was 14,000 contractors.
    Mrs. Capps. Let me get to that in a second but thank you. 
Are you aware that the first year it is in effect, the lead 
rule is expected to shield 1.4 million children under the age 
of six from hazardous lead dust?
    Mr. Pratt. Yes.
    Mrs. Capps. Mr. Pratt, your testimony states that EPA has 
not certified enough contractors to comply with the Lead 
Renovation Rule and your testimony asserts that fewer than 
14,000 contractors have been trained to date. Mr. Pratt, I 
understand that the committee's desk spoke with EPA yesterday. 
Did you know that based on updated information, the EPA 
estimates that 50,000 individuals have now been trained to date 
at more than 3,100 courses. Are you aware that EPA estimates 
that at least 100,000 individuals will be trained by the time 
the rule goes into effect next month?
    Mr. Pratt. No, I was not but I would modify my written 
testimony if that is what is needed.
    Mrs. Capps. Thank you. Let me just wind up then. Thank you. 
Your testimony states that there are no training providers in 
several States and I want to clarify that many of the training 
providers do travel from State to State and these traveling 
providers have traveled to States that do not have fixed site 
trainers. For example, despite the absence of a fixed site 
training entity, hundreds of renovators have been trained in 
Louisiana already and I am going to close by just saying, Mr. 
Chairman.
    Mr. Markey. You have 2 minutes left.
    Mrs. Capps. I know but I want to make a statement. I 
appreciate Mr. Pratt's acknowledgement that maybe we need to 
update, you know, the numbers that we have according to the 
latest figures that we were able to get but I for one strongly 
oppose the notion of delaying this Lead Rule. I don't believe 
it is right and I don't believe it is necessary. I believe 
taxpayer dollars shouldn't go to, should not go to projects 
that permanently damage children and I don't accept that we 
need to sacrifice our kids' health in order to put people back 
to work and save energy and with that I yield back my time, Mr. 
Chairman.
    Mr. Markey. We thank the gentlelady.
    The chair recognizes the gentleman from Texas. Oh, yes, I 
think it is the gentleman from Texas, Mr. Burgess.
    Mr. Burgess. Thank you, Mr. Chairman.
    Secretary Zoi, one of the little magazines that we all get 
up here all the time last week had some numbers from your 
Department about what had been received in Stimulus funds and 
what had actually been spent. Presumably, that was public 
information that was put out by the Department of Energy. How 
have you done on spending the money that you got from the 
Stimulus Bill last year?
    Ms. Zoi. The--we are in a really good spot now. We are 
ramping up. Some of the shovel-ready projects took a little 
longer to get the shovels in the ground based in part because 
of the design of the program and the design of the statute. 
Just to take a few that are under my portfolio, the 
Weatherization Assistance Program now.
    Mr. Markey. Ms. Zoi, can I just, yes, thank you.
    Ms. Zoi. How about that?
    Mr. Markey. Good.
    Ms. Zoi. The Weatherization Assistance Program now is at 
nearly at its full ramp rate of about 20 to 25,000 homes a 
month. The State Energy Program, that is a $3.2 billion program 
where the money was obligated to the States at the end of 
September, the structure of the and a third, fully a third of 
the money, $1 billion is out in awards.
    Mr. Burgess. Yes, let me, I hate to interrupt but obviously 
my time is limited. The chairman is very strict with me.
    Mr. Markey. Not today, whatever you want. We will just be 
open-minded.
    Mr. Burgess. But $823 million has been spent as of March 4 
figures that were available of the appropriated $25 billion and 
we have got a bill in front of us that has essentially a blank 
check written in the back and we appropriate such sums as are 
necessary. Why would you need any additional money at all when 
you have $25 billion waiting to be used?
    Ms. Zoi. We have.
    Mr. Burgess. Why not use that money first before coming and 
asking as they were described yesterday, the feckless 
appropriators, for an additional $6 billion.
    Ms. Zoi. The program, the programs have obligated I think 
$25 billion of the $36 billion that came to the Department of 
Energy so that is all either under contract out at the State 
level workers have been hired. The figures that show up as 
spent don't show up as spent in the Federal system until the 
Federal Government gets invoiced by the grantee and in many 
cases it is a State or it is a private, it is a university or 
it is a private company so the actual costing figures which is 
in everyday parlance it is money spent, that lags in terms of 
actually the work being done. There are so we do not have 
available to use whatever number of billions of dollars because 
the vast majority of that has already been obligated to good 
projects that are out in the field creating jobs right now.
    Mr. Burgess. The Stimulus Bill was passed in February with 
a great deal of rapidity without time to read the bill because 
it was so important to get the money out there but now here we 
are 13 months later and only a small portion of the monies that 
you had available has actually been delivered to projects that 
are putting people back to work. How do we have confidence that 
providing additional money to your Department is going to be 
utilized any more efficiently then the large amount of money 
that you already received?
    Ms. Zoi. Well again, first of all, there are thousands of 
jobs that have been created and that money is already being put 
to work so for the State Energy Program for example, $1 billion 
is already under contract at the State level creating jobs. 
Now, those States have not invoiced the Federal Government so 
it is not showing up as spent but the work is getting done. 
Private sector people and State people have been hired to get 
that work done. Secondly, the structure of this program is 
going to move even more quickly I would guess depending on what 
the market demanded then Cash for Clunkers did and Cash for 
Clunkers.
    Mr. Burgess. Oh, please don't mention Cash for Clunkers in 
this committee.
    Ms. Zoi. All right but to your point is there a spending 
bottleneck.
    Mr. Burgess. That is not a good metric.
    Ms. Zoi. The structure of the program.
    Mr. Burgess. Listen, none of us are against energy 
efficiency but this should be driven by the market. I know of 
two electric companies back in my district, one which is 
providing a credit to homeowners if they want to put solar 
equipment on their homes. Another which is really a forward-
leaning project will allow homeowners to rent the equipment. 
The electricity company is providing the capital and the 
homeowner rents the equipment and sells the electricity back 
because we do have net metering in Texas. Those are great 
programs. This is something that should sell itself. We 
shouldn't have to go in debt billions of more dollars to 
foreign countries in order for these programs to happen because 
they are a good idea. People want to do this and when they find 
out the amount of money, I have no quarrel with people putting 
solar panels on their roof. I think in Texas it makes a lot of 
sense. We primarily use a lot of electricity during the 
summertime. We need our air conditioners. I am all for putting 
lots of solar panels on lots of roofs and let us not build 
another coal fire plant. I think that is a good idea but it 
sells itself. Why are we--is it necessary to pump money into 
what seems to be a fairly inefficient, bureaucratic pipeline 
that takes 13 months to get deliverables out to the other side? 
It seems like the marketplace could move much more rapidly on 
this. That is just an observation. One other thing in the 
newspapers in Texas, the business section of the Dallas Morning 
News a few weeks ago detailed this large wind farm that was 
going to go into west Texas with Stimulus money and they were 
buying Chinese windmills. Now, what is up with that? We have 
got a windmill blade manufacturer in Gainesville, Texas. Why 
didn't we buy American blades for that?
    Ms. Zoi. Well, we haven't seen that, the proposal for that 
project. The 1603 Program I think to which you are referring 
again has created already 10,000 construction jobs, 2,000 
ongoing jobs.
    Mr. Burgess. In China.
    Ms. Zoi. No, no, in the United States. Those jobs are in 
the United States. The wind and I agree with you, the wind 
blade manufacturing capability has grown significantly. A few 
years ago the wind industry, the domestic contract in the wind 
industry was probably about 25 to 35 percent. It is now because 
of all the work that is being done it is now over 53 percent 
and with the 48C Program that we talked about a little earlier 
in this hearing, we are investing in the ability to manufacture 
gear boxes. At the moment, wind gear boxes are not manufactured 
in the United States because we haven't had policies to support 
it but all of that is coming. We are on a trend line here to 
rebuild and catalyze the renewable energy industry that is 
incredibly important for creating jobs across this country.
    Mr. Burgess. I know in the interest of time, let us get you 
that article. It was in the business section of the Dallas 
Morning News last month and I would like to if you don't mind 
submit that to you and see if we can get your comments about 
what was contained within that article.
    Thank you, Mr. Chairman, for your indulgence. I will yield 
back.
    Mr. Markey. We thank the gentleman very much and the Dallas 
Morning News is actually going to host about 25,000 people at 
the Wind Convention in a couple more months.
    Mr. Burgess. There is a lot of money in that.
    Mr. Markey. Well there is and they are turning it into 
money so let me turn now and recognize the gentleman from 
California, Mr. McNerney.
    Mr. McNerney. Thank you, Mr. Chairman.
    I would like to just address the issue that the gentleman 
from Texas raised. I spent my career developing wind energy 
technology only to see that technology go overseas because 
there wasn't sufficient support in this country so the jobs 
that we should have been creating are being created in China. 
They are being created in Germany because they are putting 
windmills in that country like crazy and we need to change that 
and create those jobs here.
    Back to the question at hand, my district has sections that 
are very hard hit by the economy and what I would like to see 
is some mechanism in this legislation or this program that 
would help implement this sort of process in hard hit areas. My 
concern is that people that are marginal economically aren't 
going to be interested in investing $1,500 without some sort of 
incentive that makes it possible, additional training, for 
example, or other methods to get those homes that probably need 
it more than any other homes to be insulated and become more 
efficient. Do you have any suggestions or ideas that would be 
beneficial in that light? I will let the Secretary.
    Ms. Zoi. We will quickly. One of the terrific things about 
the bill is that there is a provision for financing, local 
financing and there are a variety of ways to provide finance to 
make it possible for folks who do not have that money in their 
bank account to be able to take advantage of this and the whole 
theory is that you borrow a little bit of money but the savings 
on you energy bills will allow that to be paid back. So again I 
would commend that provision of the bill in particular.
    Mr. McNerney. OK, Mr. Pratt.
    Mr. Pratt. The training program that HBI has come up with 
has trained disadvantaged people definitely in the 
Weatherization Program. I have instructed hundreds of people on 
the installation of weatherization. Most of those people are 
disadvantaged in some variety to the point where people ask me 
if they can return the bottles to get the bus ride so they can 
come back the next day. It is very imperative that this program 
not necessarily just be a certification program where you 
certify contractors that you are actually specing the 
weatherization training that is going on instead just the 
specific certification that someone gets from it.
    Mr. McNerney. Well, that is a good point. A concern I have 
is that if there is a program that gets ramped up too quickly 
there won't be enough people out there to know how to do what 
they need to do. Walking into a house and making an assessment 
of what needs to happen to make the house more efficient, it is 
not rocket science necessarily but it needs training and it 
needs certification. Are we going to be able to ramp up enough 
people to meet those needs if this program moves forward?
    Mr. Pratt. This program in front of you, this program here, 
not necessarily the HomeStar Program in itself but this program 
right here specs the level of training that is designed for the 
sixth, seventh, eighth-grader level of knowledge to be able to 
confer and install the products. That is what it was designed 
for as workforce training, not just a certification program.
    Mr. McNerney. Sure.
    Mr. Laseter. And I am sorry, the certification programs 
that are currently in the bill, they also have training outlets 
and back where the President announced some of the details that 
Savannah Technical Community College, there are training 
outlets like that everywhere where these kind of rigorous 
training people will receive that gives them the skills they 
need to actually get their certification so the additional 
certifications can happen quickly.
    Mr. McNerney. OK.
    Mr. Engler. The only thing I would add to that is that, you 
know, as governor for 12 years I worked in a lot of hard hit 
areas. I currently also serve on the N.E. Casey Foundation 
Board so we work with communities that are hard hit. When we 
start reducing the unemployment rate, you should start with the 
people who were most recently were detached from the workforce 
and you work your way down. Those that are hardest hit who 
haven't worked in 10 years will be the last to be hired and 
they are the ones that need the very low minimum wage or the 
differential wage to be hired to get some connection. That was 
the way it worked for Welfare Reform and sometimes we try to do 
policy to get the hardest possible person to work first and 
that is just expensive and wasteful and it will fail. In this 
case, we have got millions of Americans who had jobs who aren't 
working. They can go right back to work. They are the ones you 
train first and as we get the economy moving, there are more 
resources left to try to deal with the chronic situations that 
you have just described and as far as investing, the other 
policy decision that is in this bill which I think the 
committee has made I hope is that energy savings are energy 
savings and when we reduce kilowatt consumption, wherever we 
save that kilowatt, MacKenzie's argument was get the most cost-
effective savings first. Harvest, said Secretary Chu, has said 
the fruit on the ground or the low-hanging fruit first before 
we get on the tall ladder and try to reach the top of the tree 
and I think this is saying let us get it where we can find it 
and so I worry, you know, and I realize I don't have to get 
elected anymore but I worry less about where we get it then how 
much we can get in terms of kilowatt savings.
    Mr. McNerney. OK, thank you.
    Mr. Chairman, I yield back.
    Mr. Markey. Great, the gentleman's time has expired.
    The chair recognizes the gentleman from Florida, Mr. 
Stearns.
    Mr. Stearns. Thank you, Mr. Chairman, and I would like 
first to ask unanimous consent to have a statement by the 
National Association of Realtors inserted in the record 
outlining their position on this legislation. Mr. Chairman, a 
unanimous consent.
    Mr. Markey. Without objection.
    [The information appears at the conclusion of the hearing.]
    Mr. Stearns. All right, thanks and I think you have a copy 
and you have seen it before.
    Ms. Zoi, a question always comes up. Sometimes a bill 
passes and there becomes technical language that changes 
everything. Can you say today categorically that there will be 
no labeling requirement that would be part of this bill if it 
passed? Do you feel comfortable saying that there would be no 
labeling?
    Ms. Zoi. Can you tease that out for me, please?
    Mr. Stearns. Yes, I think the problem would be is like in 
the cap and trade there was a portion of the bill that actually 
put a label on the house to say that it was not complying with 
energy efficient requirements. It had different things and it 
was given in a rating and so this label created in the minds of 
the homeowner that one, his home was worth less and in the 
person who was buying it, it was discounted so you get this 
sort of a stigma attached to a house or a property. So we are 
concerned that if this bill passes that there would be some 
kind of understanding by you and your people in the 
Administration that you would put a label on a house. So I am 
hoping that you will say today that there will be no labeling 
requirement.
    Ms. Zoi. I don't think that the nature of this bill is 
about that.
    Mr. Stearns. So your answer is?
    Ms. Zoi. It is a voluntary program where people go and take 
advantage of energy efficient technology as they get installed 
in their home.
    Mr. Stearns. OK, so your answer is no, for the record. OK, 
the other thing I have a question for you in the bill the White 
House indicates that the number of homes improved under the 
HomeStar Program could be three million. I just flipped through 
here in the notebook they gave me and it appears that when you 
went to weatherize a home that in 1 year they got a maximum 
across all 50 States was 125,000 is all. How did you come up 
with--what is the source of that estimate that you will get 
three million when the facts just for weatherization was only 
125,000?
    Ms. Zoi. Yes, I think that this is a different sort of 
program so the calculations are done based on projecting what 
would be the average rebate that a consumer would take 
advantage of? How big is the pot of money available for Silver 
Star rebates and Gold Star rebates? How big do we, what is the 
average rebate amount and that is the number of transactions 
that we have got so if indeed again the Senate version has 
nominated, you know, $3 billion or so for the Silver Star 
Program, you figure each house will take advantage of, you 
know, one measure or 1.2 measures like 1.2 children, then you 
just do that math. So you are able to reach that many more 
homes then the Weatherization Assistance Project which is what 
I think you are referring to where they go and do kind of a 
whole home retrofit for low-income folks up to the tune of 
anywhere between $4,500 and $6,500 per home. The average 
investment per home and with this is likely to be lower 
therefore, more homes will get done.
    Mr. Stearns. My colleague, Mr. Shimkus, had mentioned how 
are we going to pay for this. The President has talked about 
freezing a very small portion of the discretionary spending. 
Perhaps, an across the board spending freeze would help pay for 
this or even some kind of freezing with Government employees. 
We have seen a lot of articles recently about everybody is 
taking a sacrifice but not necessarily Government employees and 
so that is possibly one way to help pay for this. The other 
thing I am concerned about is that the way you have it in this 
Rebate Program it might be more effective and shall we say less 
bureaucratic that you wouldn't have to use all these formulas 
if you had a tax credit and I think this had been brought up 
before, are you receptive to a tax credit rather than a rebate?
    Ms. Zoi. Well, there is an existing.
    Mr. Stearns. Just yes or no.
    Ms. Zoi. There is an existing tax credit and we have an 
opportunity now to harmonize job creation immediately with 
energy savings for families so I think this program will have 
an immediate catalyzation of a big part of the sector.
    Mr. Stearns. Let me read this other question, it is a 
little long. The bill doesn't allow taxpayers to receive both 
an energy efficient, that is Section 25C, tax credit and a 
rebate. How will you know whether a Section 25C tax credit has 
been applied for regarding a HomeStar product? Is the 
Department of Energy going to check the IRS records? Is the IRS 
going to check the DOE records? Are we just going to assume 
that no one would be so nefarious or simply confused as to 
claim a credit for an item for which a rebate was received?
    Ms. Zoi. I think we would never assume Americans would be 
nefarious.
    Mr. Stearns. That is a safe answer.
    Ms. Zoi. But no, what happens is this is an instantaneous 
point-of-sale rebate. Those records would then be provided to 
the IRS plus it would be tax fraud if taxpayers tried to apply 
for both so we would have the records and then the IRS, we 
would provide our records to the IRS.
    Mr. Stearns. Mr. Chairman, thank you for your questions. I 
assume as we go around that you as the chairman will probably 
find a way to pay for this so that we don't add to the deficit 
so I would be curious--perhaps you might enlighten us how we 
are going to pay for this.
    Mr. Markey. Well, in your own personal instance it will 
probably be your winnings from the NCAA pool that you just 
filled out. OK, I think that you will be able to make perhaps 
$300 up.
    Mr. Stearns. It won't be that much.
    Mr. Markey. The gentleman's time has expired.
    I would like to submit for the record testimony from Steve 
Nadell from the Americans for Energy Efficient Economy that 
outlines the technical specifications in HomeStar as well as 
the job numbers. Without objection, so included.
    [The information was unavailable at the time of printing.]
    Mr. Markey. The chair recognizes the gentleman from 
Washington State, Mr. Inslee.
    Mr. Inslee. Thank you. Thanks for the Coalition's work on 
that. This is just has got such fantastic upside for us both 
short term and long term. We really appreciate all of your 
efforts. Congratulations, Governor Engler. The first lithium 
ion manufacturing plant in America is going to go into 
Michigan, in Holland, Michigan because of the Stimulus Bill. We 
are going to have to give you some credit for that somewhere 
along the line, and thanks to Mr. Welch for his leadership on 
this issue.
    I want to ask a couple of questions about those who might 
be skeptical a little bit about this proposal. I am really not 
but I would like you to address some concerns that have been 
raised. The first one about having the division between silver 
and gold in general, silver being a compensation system for 
specific entities, and gold being more performance-based. So I 
guess my first question I have is why shouldn't--what will we 
say to those who think everything should be performance-based 
and we shouldn't have a dollar of taxpayer money invested until 
we have a specific performance of X percentage for every single 
house?
    Mr. Thaman. I would be happy to address that. In my 
testimony I referenced the MacKenzie Study and I think others 
on this panel did also which looked at carbon emissions and 
also energy efficiency and rated insulation which is the 
product we manufacture as the most energy efficient. One of the 
things you need to understand in rankings like that is cost of 
inspections and cost of audits are not factored into that 
analysis so the assumption, which I think is a good assumption, 
given our contractor base and the people we work with is that 
good, honest, hardworking people are going to install products 
correctly and that products installed correctly for their 
intended use save energy, and we know that that is the case 
with the insulation products that we manufacture. If we get too 
prescriptive in terms of specifying inspections and audits as a 
part of trying to make the economics of this program work, you 
actually destroy the economics of the products that save energy 
because of the additional cost so I think this bill sought to 
find a balance between Silver Star-type products which are 
known to save energy for sure, and then Gold Star-type projects 
where an inspector can come in and come out with a whole house 
approach to improving the energy efficiency of the home.
    Mr. Laseter. And if I may add on the Gold Star side as 
being a home performance contractor ourselves, these are proven 
technologies, proven models. We install many of these same 
proven measures. In fact, at our company we are so certain that 
we actually provide a whole home energy savings limited 
guarantee for the homeowner where we guarantee the first year 
energy savings so one of the beauties in the balance is proven 
technologies immediately in the marketplace.
    Mr. Inslee. So I just did my observation. These are proven 
technologies. We have good data about them about their 
effectiveness however we have to realize there will be some 
Americans who don't install them perfectly. They won't always 
work perfectly when they are installed but my belief is the 
cost of trying to assess perfection is going to be greater than 
the loss of imperfection of those who don't, who have two 
thumbs and don't do the installation exactly perfectly. That is 
my sort of feeling about this and that is why I think this is 
actually a pretty good balance that you have struck.
    Second question, the National Association of Homebuilders 
had asked to recognize the Homebuilders Institute as the 
certifying or a certifying, I am not sure which, entity for 
certifying workforces. That entity was not included. Is there a 
reason for that and what should we be thinking about the 
certifying agencies?
    Ms. Zoi. I can say from the Department of Energy's 
perspective we are quite interested and excited to have all 
qualified certifications be part of this thing and we have 
suggested that the Secretary has the latitude to add more as 
more rating schemes and qualifications schemes become available 
but we are quite open to the HBI being part of this.
    Mr. Inslee. Thank you, I appreciate that.
    Just one comment, I was reading Dr. Chu's testimony in some 
blog somewhere last night about efficiency. I said this before 
but I want to reiterate this, I hope you will unleash him in 
the coming weeks particularly while the U.S. Senate is 
considering energy legislation to really share what he knows 
about this field particularly with the other chamber because it 
is incredibly powerful and I hope that you will allow him to 
live in the U.S. Senate in the next several weeks. We need a 
101st senator and it should be one who knows the physics and, 
you know, could be a second Nobel Prize out there so I hope he 
is there. Thanks very much.
    Mr. Markey. The gentleman's time has expired.
    Well, we thank all of you for being here and here is what 
we are going to do. We are going to give each one of you your 1 
minute. Give us your best shot here in 1 minute. What is it 
that you want this committee to do? A lot of people think that, 
you know, energy conservation is like watching grass grow. How 
can that be exciting, you know? How can that be interesting? 
How can that be good for our country? How can that be the smart 
way of going and so we will give each one of you a minute to 
kind of summarize it why the members of this committee, if they 
were all sitting here, would know why this is such an exciting 
subject and why they should, you know, invest the time to 
understand it and to explain it to the American people. So we 
will begin with you, Mr. Pratt, and we will go in reverse order 
of the opening statements so that we can have each of you make 
your case to the American people.
    Mr. Pratt. Well, as an experienced trainer, as someone who 
has trained workforce in this venue, I feel as though that 
opening up the marketplace to having multiple training 
organizations inside this program allowing disadvantaged people 
to go through and get training, I do believe that the existing 
construction network although it has a lot of training still 
needs to be reinforced with a lot of training. My encouragement 
is that we don't necessarily tie this program to a 
certification program, that we have multiple certification 
programs which are already existing out there and incorporate 
into the program.
    Mr. Markey. All right, can you up the excitement level, Mr. 
Thaman, in your concluding 1 minute?
    Mr. Thaman. I will do my best, Chairman Markey. You know, 
we would say as we have all said that employment is very far 
down in the construction industry. We do not believe the 
economy is out of the woods and we do think that it is 
important that this group take action to try to stimulate the 
economy and create additional jobs in our sector. People are 
trained. They are ready to come back onto the job. We are ready 
to employ them if there were demand. Creating demand for energy 
efficiency products is a great idea. It gets a hard hit part of 
the economy back to work. It creates energy savings and money 
in the pocket of consumers. It reduces energy dependence. It 
reduces energy imports. It increases energy security and it is 
one of the few energy policy moves that we have that is 
actually capital creating as opposed to capital destroying 
because it actually creates savings and creates consumption. We 
think a simple, meaningful and direct incentive to homeowners 
to improve the energy efficiency of their home is good policy 
and we support it.
    Mr. Markey. Great, thank you, Mr. Thaman.
    Governor Engler.
    Mr. Engler. Well, just following on Mr. Thaman's beautiful 
remarks, it is a win for jobs. It is a win for energy 
efficiency. It is a win for the overall American economy and 
then it ought to be followed up the work on this HomeStar 
legislation with picking up the pace on initiatives the 
President has talked about that all can support. We need to get 
these transmission lines built in this country and rebuilt. 
That is free energy. It is being generated but lost in 
transmission. That is a simple revenue bond. We don't need 
Government help to do that. We just need to clean up the 
process and put the EPA in the closet so we don't need NEPA on 
existing rights-of-ways. There are already power lines. Let us 
build the new ones. Let us get that done. Let us get the 
nuclear power industry going. To Mr. Burgess' point earlier, 
the supplier base was largely driven out because we weren't 
doing anything in a lot of these areas and we better start 
building nuclear power plants, we will get that base back here 
so the whole host of these kinds of things that in the energy 
space, all of which put Americans to work and reduce the 
emissions and reduce the energy intensity of the country.
    Mr. Markey. Thank you, Governor Engler, very much.
    Mr. Laseter.
    Mr. Laseter. Yes, sir, Chairman Markey, I will start with 
two words, granite countertops, OK, that is exciting. People 
when they can in this economy when they can often get the money 
to do a home improvement.
    Mr. Markey. If they were remaking the movie, ``The 
Graduate'' today, they wouldn't be saying plastic. They would 
be saying granite countertops.
    Mr. Laseter. When people have the money to do home 
improvement they start thinking granite countertops. This 
program will put energy efficiency on sale for every American 
household so instead of thinking granite countertops, they will 
think energy efficiency and that is the reason this program 
will work.
    Mr. Markey. Great, thank you, Mr. Laseter.
    Ms. Zoi. I like that.
    Mr. Markey. Can you move in that microphone just a little 
bit closer?
    Ms. Zoi. I think we have a moment to create speed and scale 
in the efficiency sector. I don't know whether who has been at 
this longer, Chairman Markey or me but we have been trying to 
make energy efficiency sexy for a long time. The truth is 
though last year only 40,000 non-low-income retrofits were done 
in this country and it sounds like one of them was done in Mr. 
Burgess' house. What we need to do is create speed and scale, 
leverage the private sector. We have an alignment here that is 
unprecedented with private sector players, Government players, 
Federal players, State players to stand this up so that we can 
get out of this and having building tune-ups becomes normal 
business for Americans going forward.
    Mr. Markey. Thank you, Secretary Zoi, as well.
    Oh sure, the gentleman from Texas.
    Mr. Burgess. My home was not a retrofit. It was new 
construction. It was all paid for with duly earned, after-tax 
dollars. No Federal program was involved.
    Mr. Markey. You know what? You were right but too soon for 
this program, OK if you had just waited 40 years.
    Mr. Burgess. Well, Mr. Chairman.
    Mr. Markey. You too could have.
    Mr. Engler. Here is the problem though, Congressman, in 
your district you will have to pay for a new power plant if 
everybody else doesn't get their homes cleaned up because the 
energy will run out some day and I want to avoid that. That is 
cost avoidance.
    Mr. Burgess. And, Mr. Chairman, with your indulgence, let 
me have a try at the 1 minute let us make efficiency appealing. 
Where else could you get Ed Markey, Mike Burgess and Roscoe 
Bartlett on the same page? Energy efficiency is the common 
ground whether you are worried about global warming, national 
security or peak oil. This is where all of those come together 
and no one on this committee, regardless of which side of the 
dais they sit on can really make a coherent argument in favor 
of wasting energy.
    Mr. Markey. I hope it would actually be we would agree that 
we don't want Notre Dame to win the NCAA Tournament, OK. There 
Texas and Boston College is going to agree on that, OK.
    Mr. Burgess. The University of North Texas actually is in.
    Mr. Markey. University of North Texas.
    Mr. Burgess. And they play in just an hour's time so go 
Mean Green.
    Mr. Markey. All right, well, you know, I might change mine. 
I have been filling out my NCAA Tournament bracket up here. I 
might go to North Texas and pick that now.
    So here we are. We have this great opportunity to as we 
know, to instead of generating more megawatts to have 
negawatts. To have the watts never have to be manufactured, 
constructed, built in the first place and as Governor Engler 
said, that saves everybody money. It costs a lot of money to 
build one of these power plants and your bills are lower. There 
are jobs created and helping people save the money, and we back 
out energy that we otherwise would have imported, home heating 
oil or have in the construction of power plants across the 
country.
    So it is win-win-win as Mr. Laseter said. It is working 
smarter, not harder. My mother always used to say that to me. 
Eddie, work smarter, not harder, she would always say it after 
she said she was going to donate my brain to Harvard Medical 
School as a completely unused human organ, OK. So I think this 
is the kind of program she was talking about, working smarter, 
not harder. When I was the chairman of the energy subcommittee 
here back in 1985 and '86 and I authored the Appliance 
Efficiency Act for refrigerators, stoves, you name it all the 
way down the line, well, there are scores of power plants that 
never had to be built because refrigerators are now twice as 
efficient as they were because of that law back in 1986. So you 
just think of every home with a refrigerator twice as efficient 
or stove or you go all the way down the line.
    So that is how we are thinking here. We are thinking, you 
know, there has to be a way in which we not just incentivize 
the importation of more oil from OPEC which is half of our 
trade deficit, by the way. Half of our trade deficit is 
importing oil. Now, that can't be a good idea given where a lot 
of those revenues then get spent against the interest of our 
country, it affects our economy. Here we have a homegrown 
industry. We have companies. We have contractors who are ready 
to go with materials made in America, with contractors who live 
here in America and with homeowners here in America who will be 
the beneficiaries. So that is about the best picture you can 
put on this. It is not made by OPEC and it is not made in 
China, made in the USA for people in the USA, installed by 
people in the USA and sold by people in the USA.
    So it seems to me that of all the tax programs that we have 
got on the books, this is one that will work magic on our 
economy and the more that we can spread this ethic, this idea 
of working smarter, not harder in terms of how we generate 
electricity in our country is the better off we are going to 
be, and a perfect example again is this wind program. Last 
year, 10,000 new megawatts of wind installed in the United 
States so if you think of a nuclear power plant as 1,000 
megawatts, 10,000 new megawatts installed in our country last 
year and half, 500 new megawatts of solar installed in the 
United States last year. That would be like half a nuclear 
power plant. Well, these are big numbers. As Secretary Zoi 
pointed out, that is 10,000 new jobs here in the United States 
and the good news is that as she pointed out is that just 3 
years ago, 4 years ago, 25 percent of the jobs in the wind 
sector were in the United States, 75 percent overseas. Because 
of the Stimulus Program, we now have it up to 53 percent of the 
jobs and the industry and testimony last week said that their 
goal by the end of the Stimulus Program is over 70 to 75 
percent of the wind jobs will be totally generated here in the 
United States.
    OK, so just changing the way in which we view how we 
produce energy or don't produce energy by installing 
insulation, by installing smarter, new devices that are made 
here in the United States, sold here in the United States, 
installed here in the United States. That is the way we have to 
view this and then we dramatically reduce the greenhouse gases 
by doing it all here in our country. We create new jobs and we 
save on the imported energy that we have to bring into our 
country.
    So it is win-win-win, win-win-win, win-win-win. This is 
something that should generate incredible enthusiasm from our 
members, you know. The reporting table should over here be 
excited at this smart new plan that is being put in place and 
so our job is going to be to get out there to sell this to lift 
it up along with these other energy technologies that are 
coming along here. Made in America as the governor said, you 
know, that should be our single most important objective this 
year to begin to put in place a program that will sustain us in 
the long run.
    So what we would like to do, Mr. Welch, Mr. Waxman and I is 
work with the Minority, work with all parties that are 
concerned about this issue so that we can put it on a fast 
track and we put it in place in a way that will give the 
benefits to people out there and give hope that new jobs will 
be created. And as you said, governor, not in 60 days, not in 
90 days, you know, but as soon as possible. Fast track this 
process. Put that gold star up there and again, I think we 
should try to put a gold star. You know, we label children with 
a gold star. We say here are the students who are doing the 
best work, you know. We label things in America. We have honor 
rolls that we want to have put in the newspaper, you know. We 
don't want to stigmatize people who aren't on the honor roll 
but we want to honor the people on the honor roll don't we? 
Don't we want to let people know who is doing the best work? 
Don't we want to let people know who are the gold star students 
and the silver star students? It begins in the first grade.
    I think Americans are ready for this. Maybe we have too 
many trophies. Maybe it is Lake Woebegone, you know, everyone 
is above average but everyone is not above average. We need 
measurements. We need to have America be number one looking 
over its shoulder at number two and three in the world in this 
sector, OK because we will then be manufacturing the jobs. We 
will then be producing the work opportunities in the years 
ahead for all those workers in our country.
    We thank you all. We want to work closely with you in the 
next couple of weeks so that we produce the best possible bill. 
So stay close to the subcommittee. We need you to call us, talk 
to us, you know, visit us and let us know how we can frame this 
because we have some ideas how to change it. I know you might 
too and I think if we all work together, we will be able to 
produce the best possible bill. Thank you. With that, this 
hearing is adjourned. Thank you.
    [Whereupon, at 12:26 p.m., the Subcommittee was adjourned.]
    [Material submitted for inclusion in the record follows:]



[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


