[Senate Hearing 111-7]
[From the U.S. Government Publishing Office]
S. Hrg. 111-7
ENERGY EFFICIENCY IN BUILDINGS
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HEARING
before the
COMMITTEE ON
ENERGY AND NATURAL RESOURCES
UNITED STATES SENATE
ONE HUNDRED ELEVENTH CONGRESS
FIRST SESSION
TO
PROVIDE RECOMMENDATIONS FOR REDUCING ENERGY CONSUMPTION IN BUILDINGS
__________
FEBRUARY 26, 2009
Printed for the use of the
Committee on Energy and Natural Resources
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Washington, DC 20402-0001
COMMITTEE ON ENERGY AND NATURAL RESOURCES
JEFF BINGAMAN, New Mexico, Chairman
BYRON L. DORGAN, North Dakota LISA MURKOWSKI, Alaska
RON WYDEN, Oregon RICHARD BURR, North Carolina
TIM JOHNSON, South Dakota JOHN BARRASSO, Wyoming
MARY L. LANDRIEU, Louisiana SAM BROWNBACK, Kansas
MARIA CANTWELL, Washington JAMES E. RISCH, Idaho
ROBERT MENENDEZ, New Jersey JOHN McCAIN, Arizona
BLANCHE L. LINCOLN, Arkansas ROBERT F. BENNETT, Utah
BERNARD SANDERS, Vermont JIM BUNNING, Kentucky
EVAN BAYH, Indiana JEFF SESSIONS, Alabama
DEBBIE STABENOW, Michigan BOB CORKER, Tennessee
MARK UDALL, Colorado
JEANNE SHAHEEN, New Hampshire
Robert M. Simon, Staff Director
Sam E. Fowler, Chief Counsel
McKie Campbell, Republican Staff Director
Karen K. Billups, Republican Chief Counsel
C O N T E N T S
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STATEMENTS
Page
Amann, Jennifer, Director, Buildings Program, American Council
for an Energy-Efficient Economy................................ 24
Bingaman, Hon. Jeff, U.S. Senator From New Mexico................ 1
Giudice, Philip, Commissioner, Massachusetts Department of Energy
Resources, Boston, MA.......................................... 15
Hubbell, Ward, President, Green Building Initiative, Portland, OR 34
Majumdar, Arun, Ph.D., Director, Environmental Energy
Technologies Division, Lawrence Berkeley National Laboratory,
Berkeley, CA................................................... 3
Mazria, Edward, Founder and Executive Director, Architecture
2030, Santa Fe, NM............................................. 13
Murkowski, Hon. Lisa, U.S. Senator From Alaska................... 2
Zimmerman, Charles, Vice President, International Design and
Construction, Wal-Mart Stores, Inc., Bentonville, AR........... 37
APPENDIXES
Appendix I
Responses to additional questions................................ 51
Appendix II
Additional material submitted for the record..................... 77
ENERGY EFFICIENCY IN BUILDINGS
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THURSDAY, FEBRUARY 26, 2009
U.S. Senate,
Committee on Energy and Natural Resources,
Washington, DC.
The committee met, pursuant to notice, at 2:38 p.m. in room
SD-366, Dirksen Russell Senate Office Building, Hon. Jeff
Bingaman, chairman, presiding.
OPENING STATEMENT OF HON. JEFF BINGAMAN, U.S. SENATOR FROM NEW
MEXICO
The Chairman. Why don't we go ahead and get started.
Today's hearing will focus on policies and programs to improve
energy efficiency in buildings. It's important to focus on the
buildings sector because it represents such a large share of
primary energy use and of greenhouse gases, Greenhouse gas
emissions in our economy. Technologies that improve building
efficiency are often referred to as the low-hanging fruit in
meeting our energy challenges because they are relatively
inexpensive compared to other climate change mitigation
strategies.
However, we have found that this low-hanging fruit can
sometimes be hard to pick. The building sector is complex, it's
fragmented. In many cases the benefits of energy efficiency
have not been well understood by those in the best position to
improve building efficiency.
In the last two energy bills we enacted significant energy
efficiency requirements for Federal buildings, most notably
adopting the 2030 Challenge for New Federal Buildings and
authorizing a net-zero energy resource and development program
for private sector commercial buildings. As we move forward in
developing an energy bill for 2009, I hope we can support the
inclusion of some bold policies that will help us to transform
the building sector.
The witnesses we have here have been asked to provide
comments on various programs and policy options to improve
efficiency of buildings, including resource for zero energy
buildings, integrated whole building design, advanced building
codes, residential and commercial energy retrofits, disclosure
of building energy use, and market-driven changes, and the role
of green building rating programs.
Let me call on Senator Murkowski for any comments she has
at this point, and then we'll call the witnesses.
[The prepared statement of Senator Mark Udall follows:]
Prepared Statement of Hon. Mark Udall, U.S. Senator From Colorado
Thank you, Mr. Chairman, for holding today's hearing.
Addressing our energy needs in a responsible and sustainable way is
necessary for our national security, our economy and our environment.
Increasing our use of renewable energy, as well as promoting new,
cleaner uses of our domestic resources, such as coal, are certainly
paths that we must pursue. But we also should further promote energy
efficiency--after all, the most affordable kilowatt of energy is the
one that is not used.
Homes and other buildings are prime targets for improving
efficiency--they account for 70 percent of our electricity use.
Furthermore, they use 50 percent of all natural gas in the U.S. and are
responsible for 40 percent of all greenhouse gas emissions. After
mortgage payments, energy costs constitute the single largest monthly
expense for homeowners.
Not surprisingly, changes that improve energy efficiency are highly
cost-effective investments that dramatically reduce high energy
expenses for businesses and families. Energy efficiency improvements
can provide a combination of direct consumer benefits that will persist
for many years. By freeing up consumer spending now devoted to utility
bills, and by cutting peak demand, we will reduce energy costs and
defer the need for new power plants.
Sun Microsystems' new data center at its Broomfield campus in
Colorado is a good example. This facility will reduce Sun's electrical
consumption by 1 million kilowatts per month, enough to power 1,000
homes in Colorado. Also, it collapses 496,000 square feet of data
center space into 126,000 square feet--doing more with less.
There are many examples of companies, schools and others realizing
the bottom line benefits of instituting energy-efficient technology in
buildings.
Today's hearing will help us explore what else the federal
government can do to promote energy efficiency in buildings. I look
forward to hearing from the witnesses today and would like to thank
them for being here.
STATEMENT OF HON. LISA MURKOWSKI, U.S. SENATOR
FROM ALASKA
Senator Murkowski. Thank you, Mr. Chairman. I appreciate
you convening the hearing today.
We recognize we've had several conversations about this,
but we're going to be busy as we move forward as a committee to
craft yet another comprehensive energy bill. Today's topic, how
to best reduce energy consumption in buildings through energy
efficiency, will be an important component of this ongoing
debate and hopefully the legislation that we will draft.
Your words were pulled from my notes here. You're talking
about the low-hanging fruit when we talk about energy
efficiency, and I think we hear that quite often, the low-
hanging fruit or the fifth fuel out there. I think most people
will recognize that efficiency is the cheapest, quickest,
cleanest resource that we have. It's generally characterized as
a way to ensure adequate and reliable energy supplies and to
simply use what we already have more effectively. It sounds
like something that everybody should be doing.
We have, of course, over the years through EPAct 2005 and
the energy bill in 2007 instituted steps to enhance the
efficiency, but many of the programs that were authorized by
Congress have not been previously funded in annual
appropriations bills. We now know that the agencies are
receiving unprecedented funding as a result of the stimulus and
it is my hope that that money will be used efficiently to
promote our energy efficiency goals.
It is important to frame the debate to ask the question,
what are the goals here? What have we done to meet our energy
efficiency goals? Where do we want to go with energy efficiency
and how can we best pursue the new options?
As we will probably learn from today's testimony, the goal
of these actions is defined differently by those appearing
before us and others who discuss this issue. It may be cutting
operating costs and passing those costs on to consumers. It may
be conformity to uniform standards, such as imposition of
Federal building codes. Or it may be reducing gases and fossil
fuel consumption.
I think that one goal that we all share is increasing
energy security. We say it all the time in this committee, but
there really is no silver bullet for solving our Nation's
energy challenges. There's certainly no silver bullet for
deciding how energy efficiency is most effective. Despite our
best intentions, a government-mandated standard doesn't
necessarily translate into maximum efficiency in real life. But
I do believe that there is a role certainly for both the public
and private sectors as we grapple with this issue.
I look forward to the comments from the witnesses this
afternoon and again thank you for the hearing.
The Chairman. OK. Why don't we start right in. Let me just
introduce all of the witnesses and then we'll just have each of
you take about 6 minutes and tell us the main points you think
we need to understand from your testimony, and then we'll
include your full testimony in our committee hearing record.
Professor Arun Majumdar--is that the correct pronunciation?
Mr. Majumdar. Right.
The Chairman [continuing]. Is the Director of the
Environmental Energy Technologies Division in Lawrence Berkeley
National Laboratory. I was fortunate to visit his laboratory
this last fall and he briefed us at that time and I was very
impressed with what I heard.
Mr. Ed Mazria, who is the founder and Executive Director of
Architecture 2030 in Santa Fe, New Mexico. We're very proud of
the work he has done nationally.
Mr. Philip--tell me the pronunciation again?
Mr. Giudice. ``Jue-DEE-see.''
The Chairman. ``Jue-DEE-see.'' Philip Giudice, who is
Commissioner of the Massachusetts Department of Energy
Resources.
Ms. Jennifer ``AH-mann''?
Ms. Amann. ``AE-mann.''
The Chairman. ``AE-mann,'' who is the Director of the
Buildings Program at ACEEE in Washington.
Mr. Ward Hubbell, who is President of the Green Building
Initiative in Portland, Oregon. Thank you for being here.
Mr. Charles Zimmerman, who is the Vice President for
International Design and Construction with Wal-Mart Stores, out
of Bentonville, Arkansas. Thank you very much for being here.
Professor, why don't you go right ahead.
STATEMENT OF ARUN MAJUMDAR, PH.D., DIRECTOR, ENVIRONMENTAL
ENERGY TECHNOLOGIES DIVISION, LAWRENCE BERKELEY NATIONAL
LABORATORY, BERKELEY, CA
Mr. Majumdar. Chairman Bingaman, Ranking Member Murkowski--
It is an honor and privilege for me to be here testifying
before you. I am Arun Majumdar, Director of the Environmental
Energy Technologies Division at Lawrence Berkeley Labs, which
has a long history in buildings research, and also Professor in
the College of Engineering at the University of California-
Berkeley. I'm a member of the U.S. National Academy of
Engineering and my field of expertise is the science and
engineering of heating and cooling, which is a large fraction
of energy consumption in buildings.
The building sector consumes the largest fraction of
building primary energy, roughly 40 percent, and is responsible
for the largest fraction of carbon emissions. Buildings also
offer one of the best opportunities, if not the best, to
economically and rapidly reduce energy demand and limit
greenhouse gas emissions.
The Energy Independence and Security Act of 2007 contains
authorized legislation for a zero net energy commercial
buildings initiative, or CBI, which calls for massive reduction
in energy consumption by 2030. I believe this is an important
and bold step. With your kind permission, I'd like to show you
some charts and graphics to illustrate the potential impact and
the challenges of CBI.
If we are successful in achieving the goals of CBI by 2030,
if you look at the chart over here, that's the amount of energy
that we will save, which is equivalent to about 4 quads. If
this were to happen today, or in 2006, we would have eliminated
the need for electricity from half the coal-fired power plants
and could have potentially provided the balance from renewables
and nuclear, a zero carbon footprint. That's the opportunity.
Now let me show you where we are today and the challenge
that lies ahead of us. The two graphs in the next chart show
data on measured or actual performance of 121 LEED-rated
buildings. The data shows that as we go from silver to gold to
platinum rating the average energy consumption does go down,
and this average is better than the national average. So LEED
does work on average.
But if you look at the scatter in the data, it tells a
different story also. The reason is that this and all other
codes and ratings are based today on design simulation, but
design and actual performance do not always match.
The chart on the right out here is even more relevant. What
this data shows is that as we tighten the design toward the CBI
goals this way of zero net energy buildings, the measured
performance can be 100 to 200 percent higher than the intent.
So this is a fundamental problem.
So the key gaps today are the lack of measurement and
policies requiring it, and the fragmentation of the market and
the process. I have made several recommendations in my written
statement. Let me highlight a few examples of how to address
the gaps with a coordinated effort through technology and
policy.
Lack of measurement. We need an information technology
infrastructure to measure and sub-meter the performance of all
public buildings, display to information to the occupants,
which could influence their behavior, and create a transparent
national repository of building performance. Without this, it
is unlikely we will diagnose common inefficiencies, identify
best practices and the best opportunities to retrofit.
This can go hand in hand with a policy that calls for
standards based on measured performance, that provides some
financial incentives and perhaps disincentives to align the
goals of a fragmented industry.
Non-fragmentation. A building is made up of materials, HVAC
systems, lighting, windows, appliances, etcetera. These
components and subsystems are supplied by different companies
who don't interact with each other. Yet when these components
are assembled in a building they do interact with each other,
and sometimes they fight each other and waste energy. It's like
driving a car with your brakes on.
The standards based on measured performance would align the
industry toward a common goal. But unless we use science and
technology, science and engineering, to develop new
technologies that design and operate buildings as an integrated
system, we are unlikely to get to zero net energy buildings in
an affordable and scalable way.
To address the challenge at adequate scale I have made
several recommendations, but here is one. To address it at
scale and to address the fragmentation, I have recommended that
we create multiple regional centers of excellence where
researchers and practitioners from multiple national labs,
industries, academia, and other critical building-related
organizations and stakeholders can collaborate and jointly
address integration between basic R and D and market
transformation, and also across science and technology, policy,
education, and training.
That ends my oral testimony, Senators. Thank you very much
for the opportunity to appear before you and testify.
[The prepared statement of Mr. Majumdar follows:]
Prepared Statement of Arun Majumdar, Ph.D., Director, Environmental
Energy Technologies Division, Lawrence Berkeley National Laboratory,
Berkeley, CA
Chairman Bingaman, Ranking Member Murkowski and distinguished
members of this Committee, it is an honor and privilege for me to be
here to testify before you to provide recommendations for reducing
energy consumption in buildings.
I am Arun Majumdar, Director of the Environmental Energy
Technologies Division (EETD) at the US Department of Energy's Lawrence
Berkeley National Laboratory, and Professor in the Departments of
Mechanical Engineering and Materials Science and Engineering at the
University of California, Berkeley. My field of expertise is the
science and engineering of heating and cooling, which accounts for
approximately 40-60 percent of the energy consumption in buildings. I
am a member of the US National Academy of Engineering, and, over the
years, I have served in an external advisory capacity for various
federal agencies, including DOE Basic Energy Sciences. I am currently a
member of the Advisory Committee of the National Science Foundation's
Engineering Directorate.
My Division in LBL was created in 1973 in response to the energy
crisis then and focused a substantial part of its efforts over these
past 35 years on reducing energy consumption in commercial and
residential buildings. It has contributed to various aspects of energy
efficiency, such as building codes and appliance standards, creation of
the building design software tools, technologies for internet-based
demand response between buildings and the grid, electronic ballasts for
fluorescent lamps, low-emittance and electrochromic windows, materials
and coatings for cool roofs, and to many demonstration projects such as
the New York Times Building in Manhattan and the San Francisco Federal
Building. Furthermore, the Division has had major influence on the
global buildings sector by educating, training and collaborating with
people in federal and state agencies, private industry, non-profit
organizations, philanthropic foundations, as well as in international
governments and organizations. I will draw upon this experience in my
testimony of how to reduce energy consumption in buildings in the
future.
In August 2008, in response to the authorization of the Commercial
Buildings Initiative (CBI) of the Energy Independence and Security Act
(EISA) of 2007, DOE's Office of Energy Efficiency and Renewable Energy
(EERE) launched a National Laboratory Collaborative on Buildings
Technology (NLCBT), with the goal of coordinating the R&D activity of
five national laboratories that have expertise in this field. I applaud
EERE's efforts in bringing the national labs together. The NLCBT
includes two members each from the EERE Buildings Technologies Program,
as well as from Argonne National Lab, National Renewable Energy Lab,
Lawrence Berkeley National Lab, Oak Ridge National Lab, and Pacific
Northwest National Lab. Over the last six months, the NLCBT has worked
closely to develop some common goals and approaches. I am one of the
Berkeley Lab's representatives in NLCBT. While I have been influenced
by the discussions, my testimony here reflects my views and those of
Berkeley Labs and University of California, Berkeley.
I also want to bring to your attention the work recently completed
by National Science and Technology Council's Committee on Technology.
Their Building Technology Research and Development Subcommittee,
representing 21 Federal agencies, released a report\1\ on High-
Performance Green Buildings in October 2008. This document lays out a
framework for R&D activities within the Federal government to achieve
the aggressive net-zero energy goals set out within EPAct 2005 and EISA
2007. DOE's laboratories were a critical contributor to the development
of this agenda.
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\1\ ``Federal Research and Development Agenda for Net-Zero Energy,
High-Performance Green Building,'' Report of the Subcommittee on
Buildings Technology Research and Development, Committee on Technology,
National Science and Technology Council, October 2008.
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1. why buildings and why now
We are living in a critical time. Energy security and climate
change are two of the most important challenges of our lifetimes, and
need urgent attention. The decisions we make and the paths we take now
will determine the future health, security and well being of our Nation
and the world. It is clear that there is no single solution to the
problem. The challenge is so massive and urgent that it requires
multiple simultaneous responses and solutions. I firmly believe that
reducing energy consumption in buildings by a very substantial margin
must be part of the solution. Otherwise, we are unlikely to adequately
address the challenges of energy and climate change.
Most economic and technical analyses suggest that buildings offer
one of the best opportunities, if not the best, to economically and
rapidly reduce energy demand and limit green house gas (GHG) emissions.
The buildings sector consumes (see box) the largest fraction of US
primary energy (roughly 40 out of 100 quads) and is responsible for
about 40% of the CO2 emissions, which is more than either
transportation or industry. The buildings sector also provides a
significant fraction of the US GDP and employment, and hence it could
play a critical role in stimulating the economy. The electricity
transmission/distribution system largely exists for buildings, and
buildings can provide some level of thermal and/or electrical storage
to complement the grid, which will be even more important to address
issues related to intermittency in renewable energy supply.
The U.S. building sector (residential and commercial):
employs 8 million people; contributes to 10% of the U.S.
GDP;
consists of about 115 million households and 5 million
commercial buildings;
energy consumption is split roughly 50:50 between commercial
and residential buildings
consumes 72% of the electricity and 55% of natural gas, and
40% of the US primary energy (larger than either transportation
or industry);
per year, consumes 40 quads of primary energy, 2.7trillion
KW-hr, and accounts for 40% of CO2 emissions or
about 2300 MMT CO2 equivalent.
has a utility bill of about $400 billion per year while the
construction sector is about $1,000 billion per year;
By 2030, EIA estimates 16% growth in energy consumption,
which will require additional 200 GW of electrical capacity.
Looking ahead, the US will add about 1.5-2 billion square feet per
year of new floor space\2\ in commercial buildings. The US has about
115 million ``households'' today, that is likely to grow to 140 million
by 2030 based on population growth estimates. If we maintain business-
as-usual, Energy Information Administration (EIA) estimates\3\ that by
2030 we will experience a 16 percent growth in buildings energy
consumption. This amounts to approximately 200 GW of additional
electricity capacity by 2030, which at a cost of about $2-5/W capital
expenditure,\4\ would require investments on the order of $500-1000B
over the next 20 years, or approximately $25-50B/year.\5\ While some
investments in the supply side are necessary to keep up with demand, we
cannot operate with a business-as-usual approach for the demand side:
We must take some bold steps for significant reductions in energy
consumption. Investments to reduce energy demand have been proven to be
more cost-effective than increasing supply, as has been the experience
in California.
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\2\ In rough terms 2 billion square feet would be equal to 2000
Forrestal buildings or over 19,000 typical Home Depots.
\3\ Annual Energy Outlook 2009 Early Release, Energy Information
Administration; http://www.eia.doe.gov/oiaf/aeo/pdf/
aeo2009_presentation.pdf
\4\ Cost estimates based on today's fuel prices are about $2/W for
pulverized coal, $0.8/W for combined cycle gas turbine, $1.8/W for
wind, $3/W for integrated gasification combined cycle, $5/W nuclear
\5\ For example, a recent industry study based on the EIA's 2030
projections, estimates that 214GW of new generating capacity at an
investment cost $697 billion will be required under a Reference
Scenario. Transforming America's Power Industry: The Investment
Challenge 2010-2030. Prepared by: The Brattle Group for The Edison
Foundation. November 2008.
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While each building is unique, buildings often utilize similar
materials and equipment, so that technologies developed for the
buildings sector can be widely replicated, offering substantial
leverage for these research efforts. Given the long lifetimes of
residential and commercial buildings, often more than 50 years,
technology development should include advances in materials, equipment,
and strategies for retrofitting buildings for improved energy
efficiency.
The Federal Energy Independence and Security Act (EISA) of 2007
contains authorized legislation for a Zero-Net Energy Commercial
Buildings Initiative, which calls for 80-90% reduction\6\ in energy
consumption for:
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\6\ Zero-net energy building reduces 80-90% energy consumption
compared to benchmarks, and uses renewable energy to provide the
remaining 10-20%.
All newly constructed commercial buildings by 2030
50% of the commercial building stock by 2040
All commercial buildings by 2050
From here on, I will focus my comments on commercial buildings
only.
Figure 1 shows that if by 2030, we achieve reductions in energy
consumption of 80% in new construction and 50% in existing buildings,
the site energy saved will be about 4 Quads (about 1200 billion kW-hr)
per year.* If this were to happen in 2006, it would have essentially
eliminated the need for electricity from approximately half the coal-
fired power plants. This would have saved 400 MMT-CO2
emissions per year. The remaining load of 4 Quads could have been
supplied by electricity produced by nuclear, hydroelectric and other
renewable sources, and one could have reached a zero-carbon footprint
for the commercial buildings sector. Yet, achieving these goals in a
cost-effective, reliable, and scalable way will be very challenging. In
new buildings, the potential energy savings with current technology are
40 to 60% compared to current code,\7\ but these are rarely achieved in
practice and it is difficult to reach the EISA'07 goals for 2030 cost-
effectively.
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* All figures and charts have been retained in committee files.
\7\ Note that current codes are for designed intent, and not based
on actual performance. See Section 3(ii) for details.
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It is critical to continue current research, development,
demonstration and deployment (RDD&D) activities in buildings, extending
known technologies. In addition, the U.S. needs an aggressive and bold
approach for advanced RDD&D to realize the full opportunity in the
buildings sector to address the challenges of energy security and
climate change.
2. framework of a national strategy
The goal of zero-net energy building (ZNEB) is bold and I believe
the right one. The scale and magnitude of this challenge is daunting,
but if successful, the US could witness significant increase in jobs,
technological leadership with global impact, and a modernized
infrastructure that has been largely underserved for the last 30 years.
Despite the scale of the problem and perhaps the best opportunity
that it offers to reduce energy demand and carbon emissions, the budget
for EERE's Buildings Technologies Program is on the order of $100M/
year, which includes only about $12M/year for the Commercial Buildings
Initiative. With these limited resources, the program has done a
remarkable job in conducting some R&D, but has necessarily focused
mostly on technology deployment through the creation of the Commercial
Buildings Energy Alliances. While this is necessary and important, it
is not sufficient.
Our past successes in building energy efficiency have taken 10-20
years to move from lab invention to mainstream market impacts as
documented by NAS studies and other reports. We need to accelerate the
process. It is critical that the Nation have a strong, long-term
commitment to a balanced portfolio and a seamless pipeline of
integrated RDD&D ranging from basic research to market transformation.
This would require coordination, integration, alignment, and leveraging
among several key thrusts, all of which require innovations:
i. science and technology;
ii. policy and finance;
iii. technology deployment and market transformation
iv. work force development through education and training.
Any one thrust alone cannot successfully address the challenge, but
collectively they can.
The short-term goals ought to be focused on creating jobs, but
without a long-term R&D base focused on science and technology, the US
could be out-innovated by Asia and Europe, which in some cases are
currently more advanced than the US. With a well-coordinated bold RDD&D
program, the US has the intellectual capital and the capacity to be a
global leader. EISA'07 authorizes $20M/yr for the Commercial Buildings
Initiative in 2008, ramping up to $200M/yr between 2013-2018. It is
unclear whether this level of investment is sufficient to address the
challenge.
3. what are the key barriers, gaps and challenges
While the numbers are compelling for reducing energy consumption in
buildings, in reality it has been difficult to reduce energy
consumption in buildings because:
i. The Value of energy efficiency is uncertain and
unappreciated.--Energy is usually a small (if any) part of
building design, which focuses mostly on cost, aesthetics,
comfort, and function. There is no clear market signal for
reducing energy consumption. Since building energy performance
is rarely measured (see ii below), and there are large
uncertainties in designed performance, the value of energy
efficiency is fraught with uncertainties, making it difficult
to evaluate and to have financial transactions without legal
implications.
ii. Actual performance does not often correlate to design
intent.--Today's building codes are for designed energy
performance, NOT for measured or actual energy performance (see
Fig. 2 later). Code-compliant solutions are typically much
worse than best practice; by definition they represent the
worst, cheapest building that can be legally built and
occupied. There are no requirements for performance
measurement, and only about 5% of new buildings are ever
commissioned--95% are operated without ever testing their
systems upon completion of building construction.
iii. The Buildings industry is fragmented (see Appendix A-
Chart 3).--The buildings industry is fraught with functional
gaps as well as management discontinuities that lead to
ineffective coordination between operational islands. There is
virtually no feedback loop from occupied buildings back to
designers, beyond lawsuits, that might correct past mistakes.
iv. Lack of systems integration in building design and
operation.--Building components (cement, steel, insulation,
glass windows, coatings, sheet rock,. . .) and systems
(lighting; heating, ventilation and air conditioning (HVAC);
appliances) are developed by independent firms whose products
are tested for individual performance independent of each
other. While this must be encouraged and is necessary, it is
insufficient. A whole building approach to design and
operation, where these components are integrated in a way that
they reduce energy consumption through cooperation, is rarely
used, which commonly leads to significant system-level
inefficiencies.
v. Lack of quantitative energy consumption evaluation.--
Building operators often have neither the training nor the
information handoff from builders they need to properly operate
the building to meet performance expectations. Most operators
are flying blind with three sets of uncorrelated data: (a) a
time dependent snapshot of performance; (b) real-time complaint
calls, and (c) an ``after-the-fact'' monthly utility bill. Most
buildings don't have proper instrumentation or an Energy
Information System to integrate, digest and display actionable
performance data for the operator.
vi. Incentives for energy efficiency are not aligned.--In
leased buildings, the building designers and developers specify
components and decide how they are integrated in the design,
primarily based on capital expenditure and not generally on
energy efficiency. On the other hand, occupants' patterns of
energy consumption determine how much energy is actually used,
which is related to the operational expenses. The dichotomy of
capital and operational cost between owner and user leads to
split incentives, and makes it difficult to spread financial
benefits or burdens due to efficient use of energy.
Since the Commercial Buildings Initiative is focused on achieving
zero net energy in buildings, it is worth noting as an example, a
recent study of some high-performance buildings. Frankel\8\ recently
conducted an analysis of 121 LEED\9\ buildings (certified, silver, gold
and platinum rated) that were in the low-to-mid range in energy use
intensity (EUI in kBTU/sqft), and studied their actual versus design
performances. Figure 2 plots the spread of measured EUI, and ratio of
actual-to-design energy use as a function of design EUI. While this may
not be a definitive study and perhaps does not contain a sufficiently
large statistical sample, some trends and indications are worth noting:
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\8\ M. Frankel, ``The Energy Performance of LEED Buildings,''
presented at the Summer Study on Energy Efficient Buildings, American
Council of Energy Efficiency Economy, Asilomar Conference Center,
Pacific Grove, CA, August 17-22, 2008.
\9\ Leadership in Energy and Environmental Design (LEED) is a Green
Building rating system introduced by the US Green Building Council
(http://www.usgbc.org/). LEED is a third-party certification program
and the nationally accepted benchmark for the design, construction and
operation of high performance green buildings.
a) While the average EUI of LEED rated buildings is lower
than the national average, there is a large amount of scatter.
Hence, LEED rating is useful on an average, but design intent
does not generally correlate with actual performance in
individual buildings.
b) For buildings with lower design EUI (i.e. towards zero net
energy building), the discrepancy between the actual and
designed EUI is larger, showing that it becomes more
challenging to accurately predict performance as the
performance goals are tightened.
There are multiple reasons for why this is so and details can be
found in Frankel's study. Clearly, further studies are required, but
some of the gaps and challenges are well known in the buildings
community and can be acted upon now.
4. recommendations for science and technology
The US needs a comprehensive and balanced R&D program to achieve
significant reductions in energy use in commercial buildings through
innovations. To complement existing near-to mid-term technology
development with longer-term development of transformative
technologies, we need to integrate basic and applied R&D much more than
has often been the case in the past. Today, building commissioning and
simple retrofits may be cost-effective, but they reduce energy
consumption on average by only 15-20%. On the other hand one can design
and build new buildings that almost reach zero-net energy goals,\10\
but at a higher cost and not easily scaled up to wide market
introduction. The science and technology challenge is two fold: (a) how
to reduce energy consumption to approach zero-net energy goals; and
(ii) how to achieve this in a cost-effective, measurable and scalable
manner. The innovations ought to focus not only on new technology but
also towards dramatic reductions in risk and cost in existing
technologies that would enable deep market penetration. Here are some
potential elements.
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\10\ P. A. Torcellini, M. Deru, B. Griffith, N. Long, Shanti Pless,
R. Judkoff, ``Lessons learned from field evaluation of six high-
performance buildings,'' Technical Report NREL/TP-550-37542, June 2006
(http://www.nrel.gov/docs/fy06osti/37542.pdf)
i. Information Technology Infrastructure for Fundamental Data
Gathering, Processing and Management.--As suggested by Fig. 2,
design intent and current simulation tools are insufficient to
model and predict energy use in buildings. The US needs a
significant program in collecting, analyzing, and displaying
measured performance of all public buildings. Without these
data, it would be very difficult to identify common
inefficiencies, best practices, and best opportunities for
smart retrofits. Furthermore, there is a need for tools to
process and manage the data such that it is readily available
and can easily be mined. This addresses 3(i), 3(ii), and 3(v).
ii. Whole System & Process Integration for Design and
Operation of Smart Buildings.--To achieve the goals of zero-net
energy buildings, optimizing individual components for energy
efficiency, while necessary, is unlikely to be sufficient. We
need a whole building approach that can treat the building as a
system and minimize the energy consumption of the whole system
while still optimizing comfort and other performance metrics.
Furthermore, given the fragmentation of the buildings industry,
sophisticated tools are required that help in integrating the
process of building design, build and delivery, which promotes
feedback and iteration. This needs:
a. science-based approach that couples building
science (thermodynamics, heat transfer, fluid
mechanics, sensors, materials, components. . .) with
architecture (structure, facade, comfort, aesthetics, .
. .) and information science (communication,
computations, control) that will lead to deeper
understanding and pathways of how to integrate
subsystems that will cooperate and collectively reduce
energy consumption as a system.
b. the above endeavor will form the foundations for
tools for accurate simulation, analysis, optimization
and data mining that can be used for both building
design and operation
c. continuous visualization, monitoring, reporting,
diagnostics and demand-response of buildings--self-
tuning buildings. This addresses 3(iii) and 3(iv).
iii. High-Performance Building Components and Sub-Systems.--
Inefficiencies in buildings can largely be attributed to
thermal management as well as inefficient lighting. Hence, it
is necessary (but not sufficient) to focus R&D effort on
innovations in:
a. Building Fabric/Envelop Materials and Device
Technology: We need to identify new approaches for
cost-effective super-insulations for both walls and
windows. ``Smart glass'' or dynamic shading whose
properties are dynamically controlled and adjusted to
minimize cooling and maximize glare-free daylight are
also necessary. Integration of phase change materials
(``energy storage'') into buildings must be
investigated.
b. Mechanical Equipment, Controls, and Thermal
Storage Technologies: HVAC accounts for over 30% of the
total commercial building energy consumption. A robust
program could help develop the next generation of HVAC
and controls suitable for use in buildings with loads
approaching 10-20% of today's loads. New opportunities
for further improving efficiencies include enhancing
heat transfer using technologies such as micro-channels
and nano-scale surface treatments, or supplementing or
substituting for vapor-compression cycles with
thermoelectric, magnetocaloric, thermoacoustic,
absorption, or other systems. Indeed, cooling
technologies in the buildings, industry, and
transportation sectors account for about 10% of primary
national energy use and are a major driver of peak
utility loads, among other impacts. Cooling
technologies in use today also use hydrofluorocarbons
as working fluids, which are strong greenhouse gases.
Advances in this area could have broad application and
significant benefits.
c. Electrical and Lighting Equipment Technology and
Controls: Lighting accounts for about 12% of energy use
in homes but often 30-50% in commercial buildings.
While steady progress is being made with improved lamp
efficacy with gas discharge and solid-state lighting
sources, large savings can also come from robust,
reliable, addressable and dimmable networked controls
that allow light levels and distribution to be
dynamically tuned to meet user needs over space and
time. The next most important source of energy use is
``miscellaneous electric loads'' (MELS), such as
computers, appliances etc. A robust effort is needed to
find ways of minimizing and controlling these loads
without inconveniencing occupants. This addresses
3(iv).
iv. Integration of Buildings with Grid & Novel Energy Storage
Concepts.--A goal of net-zero energy buildings requires both
substantial increases in energy efficiency (up to 70 percent or
more) with the balance provided by some form of renewable
energy generation, either on-site (e.g., photovoltaic) or from
off-site renewable generation. Research is needed to reduce the
cost and enhance the performance of approaches to integrate
renewable energy and energy storage systems. Research is also
needed to capitalize on saving opportunities available from
integrating intelligent buildings with the emerging smart grid.
This addresses 3(iv).
v. Field Test Beds and Reconfigurable Test Facilities.--A
wide diversity of real buildings ought to be used for
collecting data and understanding common inefficiencies, best
practices and best opportunities for reducing energy
consumption. However, if one needs to incubate, debug and
``crash-test'' new technologies, they could potentially pose
safety and occupational hazards to the occupants. Testing in
facilities that are reconfigurable allows pinpointing of
technical problems and rapid correction of design flaws, and
also allows for ``crash-testing'' and debugging new
technologies before they are rolled out in real buildings with
occupants. They also provide much-needed measured evidence to
builders and operators that proper systems integration can
indeed significantly reduce energy consumption. Furthermore,
such test facilities can also be used for education and
training. This addresses 3(i)-3(v).
vi. Advanced Construction Methods.--Often, poor on-site
assembly result in buildings that adversely affect their energy
use performance. New construction approaches are needed that
are more effective at achieving energy efficiency and renewable
energy integration. Advanced techniques also reduce
construction wastes and enable utilization of newer materials
with lower embedded energy and carbon emission consequences.
This addresses 3(iv).
5. recommendations for policy and finance
To achieve the zero-net energy goals given the barriers, gaps and
challenges identified in Section 3, market forces alone are unlikely to
enable market transformation. Innovations in policy must be used, but
these need to be researched and evaluated for feasibility as well as
impact on energy consumption, economics, law etc. Here are some
elements--some of these are fundamental shifts from current policies,
but these are necessary to achieve the bold goals outlined before.
i. National Building Standards Based on Measured
Performance.--This requires new policy to benchmark and label
all commercial buildings based on measured performance.
Measuring and disclosing real building energy performance
consistently and reliably across the commercial building sector
is essential to stimulate market awareness and demand for
valuing and achieving improved energy performance levels. This
addresses 3(i) and 3(ii), and will be enabled by 4(i).
ii. New financial instruments, valuation and performance-
based compensation.--There are many aspects of commercial
buildings finance that could be altered to encourage investment
in higher performance building solutions, such as: (a) grants,
subsidies, tax credits, or other financial incentives to defray
higher first costs associated with the design, construction,
and operation of efficiency and renewables integration and
subsequent measured performance; (b) including building actual
performance parameters in real-estate valuation; (c) developing
and promoting alternative leasing provisions that address split
incentives--such as between owners and renters. This addresses
3(v) and 3(vi), and is enabled by 4(i) and 4(ii).
iii. Incentives for action--tax rebates and utility
programs.--There is a wide and growing array of tax incentives
and utility programs to promote energy efficiency more
aggressively. The options proposed here build on this
foundation to identify and implement a comprehensive,
integrated set of financial and business incentives to
supplement existing energy price signals that: (a) Develop and
expand utility incentives; reward higher measured performance;
(b) Decouple sales and revenues for utilities nation-wide; (c)
Develop and expand tax credits for high performance buildings
based on measured performance; (d) Develop programs for capital
subsidies, grants, and loans; (e) Promote expedited permitting
for high performance buildings. This addresses 3(v) and 3(vi),
and is enabled by 4(i) and 4(ii).
iv. Incentives for Retrofits and Upgrades.--Since the
lifetime of commercial buildings is generally more than 50
years, we must promote retrofitting and upgrading the existing
building stock. Financial programs that could amortize the
initial cost for upgrades over a time period could
substantially minimize the financial burden for retrofits.
6. recommendations for technology deployment and market transformation
In the commercial buildings area, there is a market transformation
challenge that includes educating, incentivizing and assisting
stakeholders involved in building design, construction and operation.
The market is fragmented and incentives are not always aligned. While
the proposed National Building Standards and affiliated financial
incentives and disincentives might push the market towards common
performance goals, other levers are also needed. Some examples are:
i. Standards generally provide the bare-minimum performance
requirements for products in the market. Programs such as
EnergyStar can help pull the top of the market, which then
helps identify and make possible the next generation of
standards. These activities can be further expanded and
strengthened.
ii. Conduct technology demonstrations and field performance
evaluations for new technology
iii. Test products to ensure they meet manufacturers' claims
and conduct independent assessments of technology cost and
performance
iv. Create a best practices network domestically and
internationally that will provide guidance for design and
operation of new and existing buildings based on location and
building type/use
v. Conduct studies of human behavioral responses to energy
use and evaluate ways to better fit products and processes to
natural responses
vi. Conduct studies of institutional responses to energy use
and identify mechanisms that can more effectively assist
implementation of cost-effective energy efficiency and
renewable energy technologies into the buildings sector.
7. recommendations for education and training
From my experience as a University professor interacting with
undergraduate and graduate students both at Berkeley and other
universities, I can safely say that the youth of this Nation are ready
to roll up their sleeves and save the world. We are in one of the rare
``moonshot'' moments in history, where we have the opportunity to
harness and galvanize the intellectual horsepower of the youth. We must
grab this opportunity to attract the best minds and unleash them to
address one of the biggest challenges of our lifetime and truly change
the course of history. However, we need a framework for this purpose,
part of which I have described in the previous sections. We also need
adequate resources. Some of the recommendations I propose below go
beyond the buildings program, and could be used in DOE and possibly
other federal agencies:
i. Initiate a significant program of graduate student and
post-doctoral fellowships as well as young investigator awards
that will attract the best young minds to energy science and
technology, and help create intellectual capital for the
nation.
ii. Initiate a program to support joint curricula at
universities or R&D centers that combines various aspects of
science, engineering, architecture, business, public policy and
law to collectively address the needs of the buildings
industry, as well as for energy issues in other sectors of our
economy.
iii. Combine research and education through the use of test
facilities for education and training.
iv. Create education/training bootcamps that rapidly enable
retraining for students and existing professionals
In the current marketplace, many stakeholders are unaware of proven
existing methods, while others may have an interest in energy
efficiency yet lack the ability to implement effective measures.
Construction, commissioning and operations of more efficient buildings
often require skill sets that are not yet widely available. The DOE
program should include an expanded, robust training program for
existing design professionals, contractors, commissioning agents, etc.
as well as developing accreditation and certification programs, higher
education programs that foster high-performance, integrated design, and
other activities.
8. concluding remarks and overall recommendations
Given the magnitude of energy use in buildings, the opportunity it
offers for reducing carbon emissions, and the scale and urgency at
which RDD&D needs to occur, the US needs a sustained and well-
coordinated public-private partnership of adequate scale. Furthermore,
it is important to create a balanced portfolio and an integrated
seamless pipeline of RDD&D activities ranging from basic to applied R&D
and finally to market transformation. Here are some recommendations to
enable this:
i. Increase linkages between the Building Technologies
Program in EERE with other programs within EERE and with other
offices of DOE (e.g. Office of Science, Office of Electricity
Delivery and Energy Reliability) so that the intellectual
horsepower and knowledge-base within DOE can be leveraged and
brought to bear on this challenge. Some of this has been done
but more is possible. Identify linkages and leveraging between
DOE and other federal agencies to coordinate RDD&D efforts.
ii. Use the geographical distribution, domain expertise, and
availability of intellectual capital of the national
laboratories to create on a competitive basis, multiple
Regional Centers or Institutes of Excellence of adequate scale
where researchers and practitioners from multiple national
laboratories, industries, academia and other critical
buildings-related organizations can collaborate and jointly
address integrated RDD&D in the buildings sector. The Centers
could complement each other in focus areas and collectively
address the needs of the Nation in a comprehensive manner.
Thank you very much for giving me the opportunity to appear before
you and testify.
The Chairman. Thank you very much.
Ed, why don't you go right ahead.
STATEMENT OF EDWARD MAZRIA, FOUNDER AND EXECUTIVE DIRECTOR,
ARCHITECTURE 2030, SANTA FE, NM
Mr. Mazria. Thank you, Senator Bingaman, Senators. Thank
you for having me testify. You have before you a booklet that
we prepared.* I'm going to call out the page numbers and
they're in the lower left-hand corner. We'll start at page 2,
and I'll talk to each one of these, each one of these graphics.
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* Document has been retained in committee files.
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So on page 2 you'll see that the building sector is not
only the largest energy-consuming sector in the U.S., it is
growing at the fastest rate.
Page 3, the building sector today is responsible for now
50.1 percent of total U.S. energy consumption. That's in 2008.
Page 4. You can break that down even further. Building
operations, what Arun was just discussing, is responsible for
42 percent in 2008 of total U.S. energy consumption.
Page 5. Of U.S. electricity consumption, the building
sector is responsible for 75 percent of all the electricity
produced in the United States. That's just building operations.
Page 6. This is electricity consumption. It illustrates
that the rate of electricity consumption by the building sector
is increasing dramatically and will continue to increase
between now and 2030. The entire projected increase in
electricity consumption between now and 2030 is due just to
building operations.
7. We issued the 2030 Challenge targets a few years ago
calling for all new buildings and major renovations to meet an
energy consumption performance standard of 30 percent below the
regional average for that building type and then moving on to
carbon neutral by the year 2030. 50 percent of the regional
average is roughly equal to about 30 percent below our latest
building codes.
8. Everyone from the Federal Government; we now have five
States; many, many local governments have adopted the targets;
most of the professional organizations; the EPA supports the
targets through Target Finder.
9. In 2005 at the G-8 summit the parties, with the support
of the United States, committed themselves to ``with resolve
and urgency,'' to cost-effective energy efficiency standards
for buildings based on a 30-year payback. That's the definition
of ``cost effectiveness.''
Page 10. NREL completed a study for Greensburg, Kansas,
showing that at 30 percent more efficient it would cost about
$4,000. If you amortize it over 30 years, over the life of a
mortgage, your energy savings far outweigh that; that a
homeowner on an annual basis will save about $512 a year. The
little chart on the right illustrates that at cost-neutral you
would go to 58 percent below code.
Page 11. The DOE completed a study for 30 percent below
code in all different climate zones in cities and they came up
with the same results, below ICC 2006.
Page 12. So we're calling for the Federal Government to
update the National Energy Conservation Code 2010, 30 percent
below our current code standards, IECC 2006, and ASHRAE 90.1
2004; and on a 6-year cycle, 2016, 50 percent below code, 2022,
75 percent, 2028 carbon neutral, giving the States 2 years to
get up to speed, and at the 50 percent make it a true
performance code because performance codes don't pick clean
energy technology winners and losers.
We're also calling for the DOE to put out reach codes so
that those States and cities and counties that want to go
beyond the standards can do so, and we really need reach codes
to take precedence over any Federal appliance standards.
14. The public building sector represents 7 percent of
total building square footage in the U.S. The private building
sector represents 93 percent. The public building sector is not
decreasing yet in terms of construction as of November and I
still don't think it's decreasing now. The private building
sector is tanking and taking the entire economy down with it.
So we've called for an economic recovery, a 2-year, 9
million job investment plan, asking the Federal Government to
put in $200 billion, roughly $96 billion a year, in a housing
mortgage interest rate buydown and a commercial building
accelerated depreciation program, tied to the energy reduction
targets that we just called for: 30 percent below, 50 percent,
75 percent, and carbon neutral.
That would create 9 million new jobs almost instantly, a
trillion dollars of new private investment. For every dollar
public spent, private money has to be spent. A new renovation
market, huge consumer savings, and we would drive down energy
consumption.
The tax base from the 9 million new jobs would pay for the
plan on an annual basis. The way it works, if you go to the
next page, page 17, let's just take a buy-down to 2.5 percent.
If you wanted to get a 2.5 percent mortgage, you'd have to meet
a standard of 75 percent below code, and those mortgage
interest rates could change depending upon how many jobs you
wanted to create.
Next page. This is how it would work. To get the 75 percent
below code you would need to spend about $51,000 to tighten up
your building and put a solar system on and do a number of
things. That's about 25 percent in additional cost that it
would cost for a new building. Let's just say you have a
mortgage of $272,300 at 6 percent. Your monthly payment would
be $1600 a month. So in order to get the 75 percent below and
to get a 2.5 percent mortgage, you'd have to invest the
$51,000.
If you rated that into your new mortgage, then, if you go
to page 21, you would have a new mortgage of $304,550. You will
have spent $51,250 on the solar system, on tightening up your
building, but now your new mortgage, with a tax credit, would
be $1203 a month.
So if you go to page 22, your original mortgage payment
would be 1632 a month, your new monthly payment would be 1200.
You would save 429 on your mortgage. You would save 145 on
energy savings on a monthly basis. Your total monthly savings
would be 575. That money goes back into the economy. You will
have spent $51,000 or more putting people back to work.
If you do that, you basically bring back, page 23, every
conceivable industry in the United States because they're all
tied to the building sector, from demolition through architects
and engineers, hardware, wood, plastics, you name it.
The last page, 24, illustrates if you implement the codes
between now and the year 2030 that we're able to then not only
stabilize the building sector, but begin to get some major
reductions in terms of building energy consumption.
Thank you.
The Chairman. Thank you very much.
Mr. Giudice, why don't you go right ahead.
STATEMENT OF PHILIP GIUDICE, COMMISSIONER, MASSACHUSETTS
DEPARTMENT OF ENERGY RESOURCES, BOSTON, MA
Mr. Giudice. Great. Thank you, Chairman Bingaman and
Ranking Member Murkowski, members of the committee. On behalf
of Governor Patrick, the Commonwealth of Massachusetts, and the
National Association of State Energy Officials, I appreciate
you asking me to be here as a witness and I appreciate your
confronting our energy and our climate challenges.
The prior speakers talked about the energy consumption that
does exist in buildings and the opportunities for savings,
substantial savings. We concur completely that there is
gigantic opportunities for significant savings here that would
spur our economy and help to address our climate and energy
needs.
In Massachusetts we've been working on many of these issues
for decades. We've been doing energy efficiency programs with
utilities, investing in specific incentives through the
utilities for both new building and existing buildings to
reduce their energy consumption. We've just now adopted new
regulations, new legislation that actually will call for our
utility efficiency programs to spend everything that is cheaper
than buying energy from the market. That looks like it'll be
two or three times as much energy efficiency activity going on
in the State of Massachusetts than we have to date of 3.5 cents
to to get energy from energy efficiency and we're paying 8 or 9
cents from the wholesale market. So a significant uptake in
energy efficiency programs.
The Regional Greenhouse Gas Initiative is going to spur a
significant amount of that growth, and the stimulus funding
that has just recently been provided is going to further that
dramatically and tremendously and we're quite appreciative of
being able to deliver on the promises that have been laid out.
Second, we've been pushing renewable energy in
Massachusetts. One example is our solar programs, a 250-
megawatt goal. In the last year we've had a threefold increase
in solar companies in Massachusetts to get on people's homes
and businesses, put solar panels on there. We used to have 20
or 30 or 50 companies doing it. Now it's over 150 companies in
Massachusetts. A little bit of private money, a little bit of
State money, and spurring substantial growth and really seeing
it change there.
Third, we've attacked building codes. We had our own
State's building code mechanisms in the past and now with this
new legislation that we passed in the State we've adopted the
International Energy Conservation Code and have automatic
updates whenever that gets updated, as well as training and
compliance requirements for building inspectors to assure that
we're fulfilling that.
So that's some of the stuff that's going on in
Massachusetts. Lots is going on on a voluntary basis around the
country that we're quite excited about, including in
Massachusetts. The LEED standards that have been talked about,
the green building initiatives activities, very exciting,
Energy Star for buildings and Energy Star for appliances--all
very good steps. NASEO is partnering with the Real Estate
Roundtable to work on commercial buildings, getting rankings
and ratings and help to reduce their energy consumption and
energy monitoring.
But much more is needed. It really behooves on the Federal
leadership to really take the next steps here. Working this on
a State by State basis doesn't move us fast enough or far
enough.
Department of Energy has an ability and we would encourage
them to take that initiative to put in place national building
codes at 50 percent improvements in energy efficiency from the
existing standard building codes across the country, regionally
specific because what works in the Northeast doesn't work in
the Southeast or the West or the Southwest, but nonetheless
substantial improvements in building codes.
Clearly they're going to have to work with all kinds of
industry and collaborators to make that work, but I encourage
this body to give DOE very strict deadlines and very strict
expectations that we're going to move massively to much more
significant building codes.
Second, we need to address some of the issues of our
buildings. Right now we design buildings to leak and they need
to leak to actually allow fresh air to come in and be able to
power our gas boilers and furnaces and hot water heaters in our
basements. That's not the right way to be dealing with these
issues.
We do know, and it's on the shelf right now, technologies
that are sealed combustion, direct air from the outside to work
the furnaces, and then we can really seal up these buildings
really, really tight, monitor the humidity, monitor the
CO2 content inside very inexpensively, have air-to-
air heat exchangers to be able to transfer outside air into
inside air, and then not have to have these buildings leak to
make them healthy buildings.
We also need to move--and there was a mention of this
before--to much more specific and significant energy labeling
of buildings. It would be great for every buyer of a building,
be it a renter or purchaser, to be able to know precisely what
that energy consumption has been and what the expected energy
consumption going forward is, just like we do when we buy a
car; we know what the miles per gallon is. This is completely
doable and we would like to see significant movement along that
front.
Then we have to remember that it's not just about large
commercial and residential single family homes. Significant
populations obviously live multifamily, live in manufactured
housing, and it's often not addressed in building codes to the
sufficient level that it needs to be. We encourage significant
steps to focus on those folks, who are often some of the most
vulnerable economically amongst us, because tremendous
opportunities exist there as well.
So I applaud the actions being taken today and the
expectations over the next months of what's going to come out
of this process. I know that we're going to go boldly with the
challenges in front of us. But I would caution us to think
about a decade from now or more we will very likely be looking
back and wishing we were bolder at this time in what we get
accomplished. So if that can be any helpful for us all to just
move as far along the path right now, because it is really the
time and the opportunity to do so much more with the challenges
in front of us.
I thank you for your attention.
[The prepared statement of Mr. Giudice follows:]
Prepared Statement of Philip Giudice, Commissioner, Massachusetts
Department of Energy Resources, Boston, MA
Chairman Bingaman and members of the Committee, on behalf of
Governor Patrick and the Commonwealth of Massachusetts, and the
National Association of State Energy Officials (NASEO), thank you for
taking on the energy and climate challenges. We look forward to
continuing to work with you, as the federal government takes a leading
role in the months and years ahead in confronting our energy future.
You have asked me to address use of energy in buildings, which
accounts for approximately 39% of total energy consumption in the
United States, and more than half of all energy use in several states,
such as my own. It is critical that we drastically cut our use of
fossil-fuel energy to meet these needs, in order to improve our energy
security, protect against the rising prices of energy which are sure to
come after our economy recovers, and to address the worldwide threat of
climate change. As my testimony will demonstrate, it is also very
doable to dramatically reduce our energy waste in buildings.
Technologies and building practices exist today which would provide the
same or better comfort with a fraction of the energy consumed. We
simply need to be much more strongly motivated to fully deploy these
better approaches.
Massachusetts strives to be a leader in promoting the use of energy
efficiency and renewable energy sources to meet the electricity,
heating, and hot water needs of buildings, but there is much more for
us to do. Let me briefly list a few of our programs, but then move on
to address specific areas that are of most interest in terms of
designing federal policies.
First, for over three decades we have continuously provided
incentives to businesses and homeowners to install efficiency measures
in their own buildings. Legislation passed last year will greatly
increase these subsidies, as it mandates that electric and gas
utilities invest in all efficiency that is less costly than purchasing
more electricity and gas supplies.
Second, we have supported development of clean, renewable energy,
both through a renewable portfolio standard for electric utilities and
through specific funding for research, development, and installation of
renewables. Under Governor Patrick's leadership, we are two years into
a program to install 250 megawatts of solar photovoltaics by 2017--with
7.2 MW awarded in 2008, spurring a 300% increase, to 150, in the number
of solar companies in Massachusetts. Last year we broke into the top
five states\1\ in terms of solar PV market size in the U.S.; and we are
now aggressively pushing development of wind power and biomass in the
state.
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\1\ ``Tracking the Sun'' report from Lawrence Berkeley National
Labs--Feb 2009 http://eetd.lbl.gov/ea/emp/reports/lbnl-1516e.pdf
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Third, we are focused on energy efficient building codes for
residential and commercial construction. Massachusetts passed a raft of
energy and environmental legislation in 2008, including a provision
that requires us to adopt the most recent version of the International
Energy Efficiency Code within one year of its publication, and specific
initiatives to train inspectors and assure full code compliance. We
have also developed an advanced or `stretch' code, for voluntary
adoption by towns and cities that wish to go significantly beyond these
base code standards, in order to accelerate our transformation of the
building construction and renovation sector in our state.
Congress and the President have made a huge effort to increase
energy efficiency and promote renewable energy with the recently passed
stimulus package. Mr. Chairman, your efforts have been in the forefront
of these energy efficiency issues for many years. The package's funding
of $3.1 billion for the State Energy Program, $5 billion for
Weatherization, $3.2 billion for the Energy Efficiency and Conservation
Block Grant and $300 million for Energy Star appliance rebates can all
make a huge difference in promoting energy efficiency in buildings. The
expansion of the existing homes tax credit to 30% and $1,500 will be
strongly promoted by the state energy offices as part of our
comprehensive effort to improve energy efficiency in homes. We hope
that additional funding of $100 million can be provided in the near
future to fund training and technical assistance to improve energy
codes, and especially to train contractors, local code officials,
architects and others to comply with higher building code standards.
energy codes, past, present and future
Allow me to focus particularly on energy codes for new
construction. This is a critical area, since once constructed a
building will be consuming, or wasting, energy for the next 50 to 100
years, and in many cases much longer. It is relatively simple to
construct commercial and residential buildings with measures that
ensure 20% to 50% less energy waste than current leading codes, and the
incremental cost is generally low. The additional cost may even
approach zero if the building is planned and designed thoughtfully.
However, if this opportunity is missed, then once a building is
completed it is far more difficult and expensive to greatly improve the
efficiency through retrofits. Thus, ensuring that initial design and
construction is done with full attention to high energy performance
standards is vital.
Yet we know that developers of buildings, and purchasers, all too
often are concerned primarily with minimizing the initial capital costs
of a building. Exceptionally few building developers, designers or
owners care about lifecycle energy costs of a building. Quickly
building the aesthetically pleasing, least expensive initial cost
building is seen time and again as the way to make the most money when
developing real estate. Stringent energy codes are needed and need to
be fully followed to reduce energy waste. In our current economic
circumstances, where construction may be difficult to finance and
energy costs are low, it is especially tempting to minimize the initial
capital costs of construction and to disregard opportunities to save on
future energy use. But our economy will recover within the next few
years, energy prices will rise again, and buildings constructed today
will be with us for a very long time.
Valiant voluntary efforts to increase awareness of the energy
choices in buildings has had an affect. More and more tenants are
asking for green buildings. Programs such as LEED and Energy Star are
raising awareness. Even today, in a difficult real estate market, there
is significant demand in Massachusetts for ``green'' high-efficiency
buildings, in both the commercial and residential sectors. However,
market forces alone are not moving us fast enough or far enough to
reduce our energy wastage.
iced--tea buildings
There is a litany of what's wrong in our current practices. For
instance, the result of the current status quo is all too often what
has been called `Iced-Tea buildings.'
While iced-tea is typically served at a temperature only slightly
cooler than tap water, it requires both energy extremes of boiled water
and frozen water to produce.
This is an apt analogy for how our current buildings are designed
to operate. Typically using over-powered heating and cooling equipment,
often running simultaneously, in an attempt to achieve a desired
temperature that varies within a narrow range of only around 65-75
degrees Fahrenheit throughout the year. Due to building envelopes and
labyrinthine ductwork networks that leak air and are poorly insulated,
these buildings need to be regularly topped off with heating and
cooling to maintain their precarious state of comfort. In addition to
massive energy use, many buildings use water with similar abandon, and
yet despite all these energy inputs we have widespread mold and air
quality concerns, leading to the relatively modern `sick building'
phenomenon.
Modern technology provides excellent opportunities to provide
occupant comfort while minimizing energy waste. Yet, in general, the
owners and managers of buildings fail to utilize this technology well.
I've been in commercial buildings in winter that are running roof top
chillers on a high rise to cool IT equipment, when simple air to air
heat exchangers would have done the same thing for a fraction of the
energy needed.
In many, perhaps most, cases buildings are never commissioned.
Commissioning is the last item on the punch list before occupancy, and
even if completed it is seldom a thorough job. Consequently buildings'
heating, cooling, ventilation and other systems are never adjusted in
order to perform correctly.
A representative of a major commercial building controls company
recently visited my office. I asked how many of their commercial
buildings were fully utilizing their building control systems to
minimize their energy consumption. He estimated that at best 10% of
their systems were ever commissioned and fewer still are re-
commissioned at any point subsequent to initial installation of the
systems.
Even when buildings operate appropriately on day one, the
complexity of modern controls, and the thousands of mechanical moving
parts in modern commercial buildings, means that they will not continue
to operate optimally without ongoing monitoring, maintenance and
commissioning. This is rarely in the budget, but even more importantly
these complex systems are not designed for longevity and ease of use.
Instead, they resemble proprietary black-boxes with future consulting
revenue potential for the designer, rather than appropriate technology
to meet the building operators' long-term needs.
The building that our agency is located in is an unfortunate
example. We are in a privately-owned high-rise, several floors of which
house state agencies. Not that many years ago the building was
renovated, and it has fully automated timing systems and motion sensors
for the lighting. Yet until recently, due to malfunctioning controls,
and the difficulty of making adjustments, the lights on most floors
have been on all night every night. The private offices and conference
rooms have motion sensors, but many of these have not been adjusted
correctly, so that the lights stay on for more than an hour even when
no one is present.
Tenants also commonly lack incentives to control their own
electricity, heating, and cooling usage, because they don't pay utility
bills based on their specific consumption, as separate from other
occupants of the building. This could be corrected by submetering of
utilities, which modern technology increasingly has made feasible and
affordable. In Europe such sub-metering is expected, but in the U.S. it
remains the exception rather than the rule.
There is a saying that what is measured can be fixed, but what is
not measured will be ignored. This is highly applicable to energy
consumption in buildings. When someone purchases a building or takes
out a lease, they rarely know what the structure's past energy
consumption has been or what it's specific energy-related features are.
If purchasers and prospective tenants knew what their future energy
bills were likely to be, they would demand efficiency improvements
before making financial commitments. For this reason, it is essential
that past energy use of buildings be calculated in a standardized way,
such as BTU's per square foot, and that these figures be publicly
available. Then these numbers need to be converted to an easily
understandable universal ranking system, such as an A to F scale. This
is being done in several European countries, including the United
Kingdom, Germany, and Austria. ASHRAE has just announced that it will
develop such a scale, and in Massachusetts our Zero Net Energy
Buildings Task Force is recommending that we begin mandating such
rankings, first for new construction, and eventually for all buildings
in the state.
While we have these systemic problems within the construction
sector, at the same time we also have the technical knowledge and
design professionals to avoid and solve these problems. It is a
relatively easy option to set our sights higher and choose a different
path, one that achieves dramatic increases in energy efficiency, while
also improving indoor air quality and day lighting. A movement to zero-
energy buildings is within our sights, as California and Massachusetts
have recognized, with other states giving this goal increasing
attention.
One primary barrier to these intertwined and complementary goals is
one of capital, or `first' costs, and investment in design. We no
longer build the way we used to a century ago, not just because we have
better technology and materials, but also because our real estate
industry does not have incentives to afford the time or the capital to
invest in new construction the way that humanity has in the past.
transformational, not incremental, improvements in energy codes
Massachusetts urges a `step change' in energy codes to reflect the
policy imperative of moving our buildings away from exorbitant use of
fossil fuel-generated heat, light and power--the Iced-Tea model--
towards efficient and integrated design. We believe that a dramatic
shift in energy awareness in the design and management of buildings is
needed to reduce our long-term energy costs, improve our energy
security, and address climate change. Massachusetts and several other
states are acting to update codes, but we urge Congress to consider
federal action, and a state and federal partnership to ensure an
adequate response at the state level.
Historically, energy codes in the U.S. have not been set at the
federal level. But this is a time for change, and federal leadership on
energy codes is needed. Moreover, a federal and state partnership could
reinvigorate the construction industry by raising standards across the
board, reaching for and achieving high-performance buildings.
Eventually our buildings will have to be net-zero consumers of fossil
fuels, so efficient that their consumption can be balanced by on-site
production of renewable energy, and we need to be designing for that
future now.
current code development leads to incremental energy improvements
Current code updates from the International Codes Council (ICC),
which creates the
International Energy Conservation Code, IECC) and ASHRAE are
iterative, incremental processes that largely protect the status quo of
building construction. ICC and ASHRAE are non-profit membership
organizations, essentially private, unelected, undemocratic bodies.
These organizations do self-select for the most technically minded code
officials, however, decisions are made by whoever happens to show up at
meetings, as voting has to be in-person. Votes at IECC are won by
whoever organizes the most people around their issue. For example, at
last year's Minneapolis annual meeting over 1,000 people voted on
requiring sprinkler systems in new residential homes, while only 150 or
so voted on adoption of most other provisions. These included a package
of measures to improve energy efficiency by 30% that DOE, NASEO and
others had worked for two years to develop. The 30% energy efficiency
improvement vote was taken at 1:30 am on a Sunday morning, and failed
to pass by five votes. What was passed is estimated to improve energy
efficiency by 12% to 14%. This is far too timid an improvement. The
time is now to be much bolder.
doe should publish a national building code within six months
We need more advanced building energy efficiency codes and we need
specific incentive funding to implement these codes and train local
code officers, builders and contractors.
During the last Congressional session advocates pushed legislation
which said that if the latest IECC (2009) does not improve efficiency
by 30% over the last version, then DOE must write its own code which
does raise efficiency by 30%. Such legislation should be proposed
again, including possibly with higher efficiency goals. This would
substantially improve upon the relatively small efficiency gains that
typically flow from the ASHRAE and IECC updates.
DOE has begun development of model energy codes that are 50%, not
30%, better than existing code. These need to be implemented, and could
form the basis for a national minimum code in the next two to three
years. This level of improvement will require more attention to
building design, including continuous air and radiant barriers in the
building envelope, higher minimum standards for windows, increased use
of insulation, and a rethinking of heating and cooling systems; but
existing off-the-shelf technology can meet these goals.
In order to provide for state innovation, federal legislation could
specify that a national code from DOE set an aggressive minimum floor
which states must adhere to, but each state is free to set even
stricter standards for its own code. Since there are large climate
differences among the states, along with economic differences, a
federal code should preserve the variance in code requirements by
climate regions.
We would also recommend that if a federal code is developed, there
be a requirement to update it every three years, as the IECC and ASHRAE
do now. Technologies are constantly changing, and much progress would
be missed by waiting more years for updates. This is a primary reason
why Massachusetts passed a law mandating that we always update to the
most recent IECC code, because until recently it had taken us eight
years between one update and the next one.
In addition to building codes, efficiency standards for appliances,
electronics, and other equipment are critical to reducing energy use,
particularly because `plug-loads' are rising rapidly as a fraction of
total energy use in buildings. Federal standards for equipment are an
integral part of ensuring energy smart codes. The performance and
sizing of heating and cooling equipment in particular need renewed
federal action, and a commitment to regular future updates.
Massachusetts has petitioned DOE to set it's own higher performance
standards for heating equipment; but for all states it is essential
that the federal bar is raised, and that the new generation of
renewable heating equipment options are fully developed and promoted.
specific recommendations for federal code requirements
Federal Energy Star standards for new buildings need to be improved
in several specific areas:
Heating systems should not require leaky buildings--Heating
with any fuel should require sealed combustion units. This
technology is already in widespread use today, and is far safer
and more efficient, not least because it doesn't require a hole
in the building shell to vent fumes to the outside.
Solar thermal--the Energy Star program already has a proposed
Advanced New Home Construction package that would require solar
water heating in Southern U.S. climate zones (zones 1-3). We
would like to see this implemented and consideration given to
solar thermal throughout the U.S.
Higher insulation standards--the same draft Advanced Energy
Star package has also proposed 50% improvements in insulation
above the latest IECC requirements.
Move away from forced-hot air heating--heating or cooling
with forced air in leaky buildings is a recipe for
inefficiency. Hot water heating and cold water cooling is not
only more efficient and more comfortable, it is also much more
compatible with efficient use of solar thermal, geothermal and
biomass pellet or woodchip heating systems. Exemplary heating
and cooling systems include radiant floor heating in Northern
climates, efficient mini-split ductless heat pumps in mixed
climates, and radiant water cooled wall and ceiling panels in
cold climates. None of these systems require any ducts, so
leaky, dusty, mold-inducing air delivery can be a thing of the
past. While traditional air-conditioning is likely here to stay
for a while, lets make it compete with other more efficient and
healthier technologies.
`stretch codes'--massachusetts and federal
There will always be a market for buildings built `beyond code' by
progressive builders and owners who value leadership in this area. To
date the EPA and DOE have filled this residential market with the
Energy Star for Homes program, and left the commercial sector more to
private and non-profit groups such as the LEED green building programs.
In Massachusetts, as in many states, there is a growing Energy Star
for Homes market. Even during the dramatic housing downturn, Energy
Star homes are retaining value and showing rapid sales. However, the
Energy Star base requirements are only a 15% energy improvement over
the 2004 IECC code, and in the higher tier a 35% improvement. These
goals equate to a Home Energy Rating System (HERS) score for new homes
of 85 and 65 respectively, where zero would be a zero-energy home.
Our newly proposed Massachusetts advanced or `stretch' code builds
on the extensive research and sound building science of the Energy Star
Homes program. But based on actual buildings constructed in the past
two years we have proposed a minimum standard HERS score of 60,
improving to 50 in three years time--roughly 30% to 40% better energy
performance than current Massachusetts code (which yields a HERS score
of around 92). Thus, our proposed stretch code would be substantially
more aggressive than the existing Energy Star Homes program. Last year,
270 homes built in Massachusetts achieved a HERS score of 60, despite
there being no financial incentives at that time to go below a score of
70.
Our stretch code is paving the way for future improvements to our
statewide base code, based on 3rd party certified performance and
heading rapidly towards a zero energy future. A more detailed plan of
action for our state will be released in March by the Zero Net Energy
Buildings Task Force commissioned by Governor Patrick last year.
California has also called for zero net energy buildings in the next
decade, in quite different climate zones from New England. Matching or
exceeding the current Massachusetts and California targets would be a
logical step to take nationwide, and we believe that the program staff
at the EPA and DOE have done the work to prepare for this opportunity.
They just need leadership from Congress and the executive branch to
send the signal to step up the planning and roll out a more forward-
looking Energy Star standard for new home construction.
existing buildings--renovations, additions, and retrofits
New construction matters, but particularly in old states like
Massachusetts, it is just the tip of the iceberg. We have massive
energy liabilities in our existing building stock, both residential and
commercial. As previously mentioned, we have a well developed energy
efficiency retrofit program operated by our electric and gas utilities,
that is undergoing rapid expansion, but we need to do more.
NASEO is working to promote Home Performance with Energy Star and
we are members of the National Home Performance Council. We are
attempting to more aggressively promote comprehensive energy efficiency
improvements in existing homes.
As a result our stretch code also applies to renovations or
additions to existing residential units, requiring any major projects
to meet the same 3rd party verified improvements as new construction,
but with a maximum HERS rating of 70, or in some cases 85, improving to
60 and 75 respectively in three years time. We are confident that bold
action will strengthen, not weaken our real estate sector, and add
green jobs and skills to our workforce.
For existing construction that is not undergoing major renovations
or additions--which is most of our housing--we also need to
dramatically improve efficiency. At present this cannot be done through
building code requirements, but can be brought about through providing
financial carrots to building owners. Massachusetts has had such
incentives for many years, through programs operated by our electric
and gas utilities, and we are in the process of greatly expanding those
programs due to legislation passed in 2008.
We have long had residential energy auditors, insulation
contractors, and plumbers making our aging housing stock more energy
efficient. And for decades we have had engineers examining our
commercial office buildings, city halls, hospitals, and industrial
facilities replacing outdated lighting, motors, refrigeration
equipment, and more.
The measures covered by the programs have varied over time, but
include steps as simple as caulking and weather-stripping leaky doors
and windows, and as complex and expensive as switching out a 50-year-
old boiler for a brand new energy-efficient one. Often, commercial and
industrial customers will get a comprehensive energy audit from
experienced engineers that will provide a list of more than a dozen
energy efficiency measures that will reduce energy expenses, cut
pollution, and improve aging capital.
These programs have been highly cost effective, delivering great
benefits to the Commonwealth. These include energy bill savings through
direct reductions in energy use by homes and businesses that have made
efficiency upgrades. But the benefits go farther than that. Energy
efficiency reduces demand for electricity from the regional electricity
grid, which means that all these measures significantly reduce
pollution from power plants and forestalls the need to build new
expensive peaking power plants.
Under our 2008 law, the state will make energy efficiency programs
compete on price with traditional energy supply. Utility companies will
be required to purchase all available energy efficiency improvements
that cost less than it does to generate power to meet the same energy
need, ultimately saving money on consumers' electricity bills. And it
will be done not as an add-on to utility bills, but as an integral part
of the way utility companies meet their customers' energy needs.
multi-family and manufactured housing
Within the existing building stock, multi-family and manufactured
buildings stand out for special attention. Such homes represent over a
quarter of the housing units in the U.S. and comprise 20% of energy
consumed by all housing units, yet receive little attention in the
implementation of energy efficiency programs. Saving energy is more
difficult in such housing, both because many residents are low-income
and because a large majority are renters. The `split incentive' between
tenants and landlords is a major barrier to efficiency investments.
Given the limited program experience to date, now is the time to
encourage innovative approaches, to evaluate these approaches, and
based on these evaluations to develop broader programs. We suggest a
competitive grant program to seek creative solutions to multi-family
and manufactured housing efficiency. Administered by DOE, this program
would provide grants to state and local government agencies as well as
nonprofit organizations to create effective, replicable projects.
Priority should be given to projects that provide substantial energy
savings while targeting recipients with the greatest financial need.
Prioritizing highly cost effective programs with significant matching
funds will help maximize the return on federal grant funds. We
recommend funding of about $50 million in the first year, rising to
about $500 million in year five for multi-family homes.
In the area of manufactured housing, models in Maine and New
Hampshire are instructive. We recommend providing rebates through state
energy offices in cooperation with state housing finance agencies.
$10,000 rebates to individuals in pre-1976 manufactured homes in order
for them to move to Energy Star homes would be a good start. $2 billion
would address 10% of the over two million pre-1976 manufactured housing
units.
There are some successful local programs in operation, including in
California, Massachusetts, and Vermont, but these are few and far
between. Programs could be developed to encourage retirement of old
manufactured homes (over 60% of mobile homes are at least 20 years
old), to invest in efficiency upgrades for new or existing publicly
assisted housing, or to institute multifamily heating system retrofits.
Historically, manufactured homes have been some of the least energy
efficient units, provided for the least financially able members of
society. Yet such housing is also an efficient method for producing
well-constructed and sealed homes, from both an air and water tightness
perspective. This makes manufactured homes some of the lowest hanging
fruit on a heavily laden tree. Technologies such as structurally
insulated panels, coupled with energy recovery ventilation systems and
ductless mini-split heat-pumps can and should transform the
manufactured homes sector, so that formaldehyde and mold scandals and
energy poverty are things of the past.
current examples of step-changes in building construction
If these recommendations sound bold, let me briefly relate two
examples that show how major changes in building design are being made
today.
Zero Net Energy Buildings in Massachusetts.--In the small
town of Townsend, in northern Massachusetts, we learned of a
small construction firm building affordable housing with HERS
ratings of zero and minus two. These are zero-net energy
buildings, using no fossil fuel, and heated and cooled with
solar thermal and photovoltaics. Equally remarkable, they are
affordable housing units, although the builder has also pre-
sold several market-rate houses in the same development. This
is but one example of a nascent but growing trend across the
U.S. and around the world.
Efficiency and solar heat in Upper Austria.--In Upper
Austria, a region about the size and population of Connecticut
that gets less sunshine than Montreal, Canada,\2\ the regional
government passed legislation last summer requiring solar
thermal space heating to be provided on all new residential
buildings. This is also a requirement in Israel and Hawaii,
where there is considerably more sunshine.
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\2\ Data from NASA for Lintz, Upper Austria 1,216 kWh/
m2, and Montreal, Canada 1,319 kWh/m2
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In Upper Austria they were able to do this because they also
have very strong building energy codes that minimize the number
of BTU's needed to heat a home. Their new buildings are
currently required to be three times as energy efficient as
average existing buildings on a square meter basis. Their
energy star equivalent program pushes `Passive Haus' standards
that have energy demands less than 10% of existing buildings,
and their zero energy homes number in the thousands. They also
require all publicly funded buildings to have an energy audit
and an energy certificate showing how that building performs on
an A-F scale. They now have over 70,000 buildings\3\ with
publicly available energy certificates, and seven square feet
per capita of solar thermal panels.
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\3\ Data from the Energy Agency of Upper Austria: http://
www.esv.or.at/esv/index.php?id=33&L=1
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Their stated goals are to reduce building energy use a
further 39% by 2030 and to move to 100% renewable heating,
cooling and electricity in buildings, thereby achieving zeronet
energy buildings sector-wide and statewide.
In Upper Austria there used to be a significant market share
of oil heating, just like the northeastern U.S. states today.
In 1999 36% of new homes installed oil heating systems. By 2007
this had dropped to less than 1%, and they tell us that there
were only 17 new oil heating systems installed in Upper Austria
last year. The oil heating industry has disappeared in a
decade, yet this has not led to an expansion of natural gas.
Instead, renewable energy heating from solar thermal, biomass
wood chips and pellets, and biogas from agricultural waste,
have grown from an impressive 32% of new installations in 1999
to a 76% market share in 2007. Upper Austria now exports their
pellet boilers and solar thermal heating and cooling technology
throughout Europe. In Massachusetts, we will be hosting our
second Upper Austrian delegation this April.
conclusion
We must all look to the future and design and build for it now.
That requires educating the public, both private citizens and
companies, on the vast potential for improving the efficiency of our
buildings. Energy labeling of all homes and commercial space is
critical, much as refrigerators and cars are labeled today. We need to
know if our buildings are an `A' or an `F' and be able to make choices
about the `miles per gallon' equivalent of a building that we are
considering a 30 year mortgage or a four year lease on. Massachusetts
is committed to doing this, but we, like Upper Austria, are only a
small state with big ideas. We encourage a federal--state partnership,
to raise national standards while allowing state innovation to
transform our energy landscape.
I am encouraged by your engagement in this matter, and as my
testimony has indicated, encourage us all to be bold. I suspect that
decades from now, no matter how bold we think we are being in this
process today, we will look back at this time and wish we had been
bolder.
The Chairman. Thank you very much.
Ms. Amann.
STATEMENT OF JENNIFER AMANN, DIRECTOR, BUILDINGS PROGRAM,
AMERICAN COUNCIL FOR AN ENERGY-EFFICIENT ECONOMY (ACEEE)
Ms. Amann. Thank you, Chairman Bingaman, Ranking Member
Murkowski, and members of the committee. I appreciate the
opportunity to testify here today. My name is Jennifer Amann
and I'm Director of the Buildings Program for the American
Council for an Energy Efficient Economy. ACEEE is a nonprofit
organization dedicated to increasing energy efficiency as a
means of promoting economic prosperity, energy security, and
environmental protection.
Buildings in the U.S. account for approximately 40 percent
of our national energy consumption. As you've noted, energy
efficiency is the fastest, cheapest, and cleanest energy source
we have, so tapping this resource in our buildings is a
critical step toward economic recovery and climate protection.
In collaboration with a range of stakeholders in the energy
efficiency, environmental, and business communities, ACEEE is
developing consensus recommendations for enhancing our existing
efficiency programs and creating new initiatives that will
accelerate an overhaul of our building stock. Our
recommendations include improvements to existing policies, such
as advanced building codes, appliance and equipment standards,
and efficiency tax incentives, that have been covered by other
witnesses or that will be addressed in future hearings.
These programs have an ongoing role to play in a
comprehensive suite of efficiency policies and programs, but my
recommendations on those are covered in greater detail in my
written testimony.
Today I wanted to focus my comments on some new programs
that we're developing to yield deeper levels of energy savings
and to broaden the reach of our existing programs.
Specifically, we urge adoption of: first, a building training
and assessment center program based on the industrial
assessment center program that DOE has operated successfully
since 1976. The skills of well-trained technicians, designers,
and contractors are needed to achieve and maintain buildings
that operate productively, efficiently, and with minimal
environmental impact.
The BTAC program will leverage existing programs at our
universities, community colleges, vocational tech schools, and
apprenticeship programs and develop new programs to expand and
accelerate the numbers of qualified individuals with the
appropriate skills and capabilities. BTACs would serve as an
important source of new work force in the field and its
graduates would be in high demand for their expertise and
experience.
Second, comprehensive building energy use disclosure, to
provide building owners and potential purchasers and renters
access to the information they need to understand the
efficiency of a given building and opportunities for
improvement. Through the program, EPA and-or DOE would develop
ratings based somewhat on existing rating programs to help
compare the efficiency of homes and commercial buildings. The
rating systems would build on these existing ratings and should
include a measured component based on estimated or actual
energy use and a modeled component based on building's
construction, envelope, and major energy systems.
Public disclosure of building energy ratings should be
required for all public buildings, and for privately owned
buildings disclosure should be encouraged for the parties to a
purchase, finance, or lease transaction, along with annual
disclosure of measured ratings to tenants of large buildings.
Third, we recommend a residential retrofit program. Tapping
into the energy efficiency potential in our homes puts money in
pockets and creates durable domestic jobs in energy efficiency
that can never be sent overseas. Congress should act to
implement a national home efficiency retrofit program,
expanding on the EPA home performance with Energy Star program
that now operates in 22 States.
To encourage greater participation in the program, Congress
should establish a performance-based rebate system rewarding
high levels of efficiency with higher rebates. The expanded
program should include support for the training of contractors
and home energy raters who would help implement the program.
This program has the support of more than 160 organizations
and businesses, including energy and environmental advocates,
contractors, and their related trade associations.
Fourth, we recommend a commercial retrofit program that
would be established to encourage the near-term launch of
large-scale deep retrofitting of private and publicly owned
commercial buildings or portfolios of buildings. The program
would provide an incentive to building owners for efficiency
improvements of no less than 20 percent, with incentives
calibrated to encourage 30 percent savings or greater. Partial
payment of the incentive would be granted upon completion of
the efficiency project and the remainder conditioned on
verification of actual performance over a 3-year period. This
program has support among energy and environmental advocates
and the commercial real estate community.
Fifth, we recommend a multifamily and manufactured housing
program. We propose Congress establish a competitive grant
program to seek creative solutions to multifamily and
manufactured housing efficiency. These homes represent more
than a quarter of building housing units and comprise 20
percent of residential energy consumption. These homes demand
special attention because it's proven difficult to implement
energy efficiency programs in this sector and because of the
disproportionate numbers of low to moderate income families
that live in these homes and that have the greatest difficulty
making efficiency investments without assistance.
These programs would be administered by DOE with grants
provided to State and local government agencies, as well as
nonprofit organizations, to create effective, replicable
projects. Priority should be given to projects that provide
substantial energy savings while targeting recipients with the
greatest financial need. Further details on each of these
program recommendations can be found in my written testimony.
In order to succeed, the new programs must receive adequate
funding and we see several potential mechanisms for allocating
program funds. State and local stimulus funds may be a source
of funding for programs with significant administration or
coordination by State and local governments. Similarly, any new
stimulus funds can be directed toward the recommended programs.
Other potential sources include emissions allowances
resulting from climate legislation or appropriations made as
part of the normal budget process to allow for startup of
climate-related programs prior to final passage of climate
legislation.
Even if funds are not immediately available, we recommend
that these programs be authorized so that they're ready when
and if funds become available.
If implemented, our recommended policies and programs would
reduce peak demand by about 41,000 megawatts, which is the
equivalent to the power produced by 136, 300-megawatt power
plants. Carbon emission reductions would total approximately 53
million metric tons in 2030, the equivalent of taking 9 million
cars off the road. In addition, the savings would amount to
approximately 3 percent of total projected U.S. energy
consumption in 2030.
These policies would also yield significant economic
benefits, including consumer energy bill savings of $12 billion
in 2030 alone, and substantial additional building energy
savings could be achieved with passage of a strong stand-alone
Federal energy efficiency resource standard.
So in conclusion, buildings represent the largest energy-
using sector of the U.S. economy. Improving the efficiency of
our new and existing building stock should be a core component
of our energy and climate policies. The policies and programs
recommended here will impact all Americans by reducing energy
expenditures, creating jobs, and cutting carbon emissions. We
urge you to give serious consideration to these policies and to
include them in upcoming energy legislation.
I'm happy to answer any questions that you may have.
[The prepared statement of Ms. Amann follows:]
Prepared Statement of Jennifer Amann, Director, Buildings Program,
American Council For An Energy-Efficient Economy (ACEEE)
summary
Buildings in the U.S. account for approximately 40% of our national
energy consumption. Improving the efficiency of our buildings can free
up energy resources to reduce the need for additional power generation
and free up money for productive use and investment in our families,
communities and enterprises. Energy efficiency is the fastest,
cheapest, cleanest energy source we have; tapping this resource in our
buildings is a critical step toward economic recovery and climate
protection.
In collaboration with a range of stakeholders in the energy
efficiency, environmental, and business community, ACEEE is developing
recommendations for enhancing our existing efficiency programs and
policies and creating new initiatives that will accelerate an overhaul
of our existing buildings stock. Our recommendations focus on: 1)
increasing the availability and adoption of high efficiency appliances,
equipment, and building components in new and existing buildings; 2)
training the highly-skilled workforce needed to design, operate and
maintain buildings and building systems to optimize energy efficiency;
3) improving information on building energy performance available to
building owners, operators, purchasers, and renters; and 4) improving
the efficiency of existing residential and commercial buildings through
comprehensive building retrofits.
Specific recommendations include improvements to existing policies
including advanced building codes, appliance and equipment standards,
and energy efficiency tax incentives and adoption of new programs to
retrofit residential and commercial buildings with additional attention
directed to multifamily and manufactured housing, train a skilled
workforce to design and operate buildings for optimal energy
performance, and provide for disclosure of building energy consumption.
If implemented, these recommended policies and programs would
reduce peak demand by about 41,000 megawatts with carbon emissions
reductions totaling approximately 53 million metric tons in 2030.\1\
The peak demand impacts are equivalent to 136 power plants of 300 MW
each. The carbon emissions reductions are equivalent to taking 9
million cars off the road for a year. In 2030, annual savings would
total 3.19 quads of primary energy,\2\ including 153 billion kilowatt-
hours (kWh) of electricity and 1,500 billion cubic feet of natural gas.
These policies would also yield significant economic benefits including
consumer energy bill savings of $12 billion in 2030. In 2020, impacts
would be about 50% of the 2030 impacts. Substantial additional energy
will be saved by the Energy Efficiency Resource Standard.
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\1\ Note: These are carbon emissions, not carbon dioxide emissions.
Carbon dioxide emissions will be 3.67x the carbon emissions.
\2\ A ``quad'' is a quadrillion Btu's. The U.S. uses about 100
quads annually.
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introduction
My name is Jennifer Amann and I am the Director of the Buildings
Program for the American Council for an Energy-Efficient Economy. ACEEE
is a nonprofit organization dedicated to increasing energy efficiency
as a means of promoting economic prosperity, energy security, and
environmental protection. For more than 25 years, ACEEE has contributed
in key ways to energy legislation including the Energy Independence and
Security Act of 2007, the Energy Policy Acts of 2005 and 1992, and the
National Appliance Energy Conservation Act of 1987. ACEEE's niche is to
conduct research on successful and promising technologies and programs
and base our policy recommendations on the results of this research. I
am here today to provide recommendations for reducing energy
consumption in buildings through improved implementation of authorized
DOE programs and through other innovative federal energy efficiency
policies and programs. I thank you for the opportunity to testify here
today.
Buildings in the U.S. account for approximately 40% of our national
energy consumption.\3\ This doesn't have to be the case. Within our
homes, businesses, schools, and gathering places there exists a
tremendous resource of wasted energy that can be captured and put to
productive use elsewhere. Improving the efficiency of our buildings can
free up energy resources to reduce the need for additional power
generation and free up money for productive use and investment in our
families, communities and enterprises. Energy efficiency is the
fastest, cheapest, cleanest energy source we have; tapping this
resource in our buildings is a critical step toward economic recovery
and climate protection.
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\3\ Energy Information Administration. 2008. Annual Energy Outlook
2009 Early Release. http://www.eia.doe.gov/oiaf/aeo/index.html.
December. Washington, D.C.: U.S. Department of Energy.
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Over the past forty years, energy efficiency has been an important
factor contributing to U.S. economic growth--while income per capita
doubled over the period, energy resources to meet the needs of our
growing economy increased by only 50%.\4\ Moving forward, efficiency
has an even more critical role to play in addressing our current
economic downturn, aggressively reducing carbon emissions, and shoring
up our energy infrastructure. ACEEE studies demonstrate the large
potential for energy savings in new and existing buildings using
existing technologies and practices. A recent analysis, focusing on the
state of Maryland, found that electricity use reductions of 29% by 2025
are not only achievable, but cost-effective.\5\ Emerging technologies
offer the promise of even greater savings well into the future.
---------------------------------------------------------------------------
\4\ Ehrhardt-Martinez, K. and J.Laitner. 2008. The Size of the U.S.
Energy Efficiency Market: Generating a More Complete Picture. May.
Washington, D.C.: ACEEE.
\5\ Eldridge, M. et al. 2008. Energy Efficiency: The First Fuel for
a Clean Energy Future Resources for Meeting Maryland's Electricity
Needs. February. Washington, D.C.: ACEEE.
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Existing efficiency policies save American citizens and businesses
money every day while reducing pollution and easing demand on our
energy infrastructure. Appliance and equipment standards already in
place will save more than 5 quadrillion Btu, over 4% of U.S. energy
consumption in 2020.\6\ Building energy codes have contributed to
reductions in new home and commercial building energy use, savings
consumers an estimated $1 billion or more per year in energy costs.
These policies have an ongoing role to play in a comprehensive suite of
buildings energy efficiency policies and programs.
---------------------------------------------------------------------------
\6\ Nadel, S., de Laski, A., Eldridge, M., and Kliesch, J. 2006.
Leading the Way: Continued Opportunities for New State Appliance and
Equipment Efficiency Standards. Washington, D.C.: ACEEE
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New programs and policies can build on the success of these
programs to yield deeper levels of energy savings and to broaden the
reach of programs to improve energy efficiency throughout our diverse
building stock. These policies will build on our growing understanding
of building science; promote the latest best practices in construction,
retrofits, and building operations and maintenance; and enable a new
generation of highly-skilled building professionals to keep our
building operating productively, efficiently, and with minimal
environmental impact.
The American Recovery and Reinvestment Act of 2009 demonstrates
Congress' recognition that building energy efficiency improvements can
play an important role in saving consumers and businesses money and
creating new jobs here in the U.S. The legislation provides a mix of
grants, rebates, loan guarantees, and tax incentives for retrofitting
federal buildings and low-income housing, expanding state-based
efficiency programs, and increasing adoption of high-efficiency
appliances and equipment. These investments in a more efficient
buildings stock are a good start, but more needs to be done. We have a
great opportunity to build on this momentum by strengthening existing
buildings efficiency policies and creating new programs to address
certain critical gaps.
In collaboration with a range of stakeholders in the energy
efficiency, environmental, and business community, ACEEE is developing
recommendations for enhancing our existing efficiency programs and
policies and creating new initiatives that will accelerate an overhaul
of our existing buildings stock. Our recommendations focus on: 1)
increasing the availability and adoption of high efficiency appliances,
equipment, and building components in new and existing buildings; 2)
training the highly-skilled workforce needed to design, operate and
maintain buildings and building systems to optimize energy efficiency;
3) improving information on building energy performance available to
building owners, operators, purchasers, and renters; and 4) improving
the efficiency of existing residential and commercial buildings through
comprehensive building retrofits.
specific recommendations
Below we provide a number of specific policy recommendations; some
are relatively minor tweaks of existing programs while others are new
programs that will require significant funding to succeed. Following
the recommendations, we discuss potential mechanisms for funding any
new programs.
Improving Existing Policies
Advanced Building Codes: In order to meet long-term energy goals,
it is important that new buildings be as energy-efficient as is
economically justified, since it will be much more expensive to
retrofit these buildings after they are completed. Model code
organizations are in the process of updating building codes to achieve
aggressive levels of savings. The International Energy Codes Council
recently adopted changes to residential building codes and will
consider additional changes in the coming months. The American Society
of Heating Refrigerating and Air-Conditioning Engineers (ASHRAE) has
set a 30% savings target for the pending 2010 update of their model
commercial building code. To support these efforts, the 2007 House
energy bill contained a provision calling for DOE and states to update
energy codes for new buildings. This provision directed DOE to support
efforts by model code organizations to update building codes to reduce
energy use of new buildings by at least 30% by 2010, and 50% by
2020.\7\ As new codes are finalized, states were directed to either
adopt these model codes or their own state-specific equivalents.
Funding and technical assistance to states was authorized. This
provision should be adopted in 2009, with the date for the second new
code accelerated to 2016. Six years between code upgrades is
reasonable, particularly since the 50% savings level is already being
promoted by federal tax incentives enacted by Congress in 2005.
---------------------------------------------------------------------------
\7\ The 50% goal is a qualification level for energy efficiency tax
credits adopted by Congress in 2005.
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In addition, Congress should consider provisions to allow higher
minimum equipment efficiency requirements in building codes (i.e.,
levels exceeding federal equipment efficiency standards) provided the
code offers an explicit pathway for meeting code levels with equipment
just meeting federal minimums (e.g., by including other efficiency
measures to make up for the lower efficiency equipment).
ACEEE estimates that by 2030, this building code provision would
save 1.4 quads of energy (including 75.7 billion kWh of electricity and
567 billion cubic feet of direct natural gas), with carbon emissions
reductions totaling approximately 23.4 million metric tons in 2030. The
policy would also yield significant economic benefits including net
energy bill savings for customers of $5.13 billion in 2030.
Appliance and Equipment Standards: Federal minimum efficiency
standards have been set by Congress on more than 40 products. New
legislation should add a few additional products, based on negotiations
now underway with industry to develop consensus recommendations on
several products. New legislation should also clarify aspects of the
process by which DOE periodically revises these standards including:
clarifying DOE's authority to set multiple performance standards for a
product (this was in the House and Senate 2007 energy bills, but
dropped from the final bill); directing DOE to consider the impact of
carbon emissions and the impact of the energy savings on energy prices
when setting standards; strengthening the ``rebuttable presumption
test'' for setting standards when efficiency savings are highly cost-
effective, and setting standards on ``BR'' reflector lamps, a major
loophole in current DOE standards. We understand the Committee is
likely to have another hearing on appliance and equipment efficiency
standards and we will provide further comments for that hearing,
including energy savings estimates.
Energy Efficiency Tax Incentives: In addition to the recent changes
to the tax incentives available for energy efficient equipment and
building upgrades, Congress should adopt long-term extensions of the
tax credit for high efficiency new homes. The new homes credit has been
particularly effective, spurring the construction of more than 20,000
highly-efficient homes in 2007 (2008 data not yet available). Also, the
amount of the efficient commercial buildings tax deduction should be
increased from $1.80 to $3 per square foot, as participation at $1.80
per square foot is very small. To increase the effectiveness of the tax
incentives, Congress should also make certain policy changes such as
simplifying and clarifying the commercial building tax incentive
paperwork requirements and including labor costs in any extension of
residential retrofit credits (for labor-intensive measures such as
insulation and duct sealing, a credit limited to a small percentage of
material cost has very little value or impact). We also recommend
adoption of a tax credit to cover the costs of approved certifications
for contractors. We have not yet analyzed the energy savings from such
a provision.
New Policies and Programs
Building Training and Assessment Center Program: Higher performance
buildings that save energy by operating with greater energy efficiency
are readily attainable today. These buildings are dependent on well-
trained technicians, designers, and contractors to perform optimally.
The effort and resources to properly train, recognize, and reward these
individuals can yield enormous benefits given high and unpredictable
energy costs. By carefully designing and engineering commercial and
institutional buildings to be more energy-efficient, up to 50% of
energy costs can be eliminated for owners of new buildings and
potential savings in existing buildings of 20% to 30% or more. However,
even well-designed commercial buildings may run 10-15% below expected
energy performance levels because of poor installation, poor
commissioning, and operational errors. Improving building energy
efficiency is a cost-effective way to make buildings more affordable,
improve comfort, and reduce costs for building owners.
We recommend that Congress establish a Building Training and
Assessment Center (BTAC) program, based on the Industrial Assessment
Center (IAC) program that has operated since 1976. This program has
been one of DOE's most effective programs, training industrial
engineers and providing them with practical hands-on experience by
providing free energy audits to industrial firms. While there are
existing building engineer and building and equipment technician
training programs in some parts of the country, there is a fundamental
need for more students trained in these skills and for increased levels
of hands-on training addressing the real-world problems encountered in
the field. The BTAC program will focus on leveraging existing programs
at universities, community colleges, vocational-tech schools (secondary
level), and apprenticeship programs, and developing new programs to
expand and accelerate the numbers of qualified individuals with these
skills and capabilities. BTACs would serve as an important source of
new workforce for the field, and its graduates would likely be in high
demand for their experience and expertise, as have the graduates from
the IAC program. Graduates from the programs will be prime candidates
for high-paying, high-skilled jobs.
In the BTAC program, engineering students in universities across
the country will work closely with professors to provide free building
energy assessments. The audits performed for commercial and
institutional buildings will emphasize easy-to-execute, inexpensive
energy saving measures for the buildings. The BTAC program will improve
the operational efficiency and performance of thousands of buildings
across the country, creating energy and dollar savings for owners and
tenants. In addition, the technicians and building operators trained in
the program will have the skills needed to maintain these energy
savings and will be guaranteed practical experience in real buildings.
By providing continuing education for building technicians, BTACs can
work with local firms and technicians to improve capacities already in
the market. A more detailed description of the program is attached to
this testimony.
Building Energy Disclosure: Building owners and potential
purchasers and renters rarely have access to the information they need
to understand the energy efficiency of a given building and
opportunities for improvement. This information can motivate owners to
upgrade their buildings, and help prospective buyers and tenants select
more efficient buildings. Through the Energy Star buildings and new
homes programs, EPA has a good track record in this area. Moving
forward, a more comprehensive and effective building energy use
disclosure program can have a much greater impact.
We recommend that EPA and/or DOE develop a rating system designed
primarily to help home buyers and renters compare the energy efficiency
of homes, and rating systems to help buyers and tenants compare the
energy efficiency of commercial buildings of the same type. The rating
systems should include an operational component based on estimated or
actual source energy use (adjusted for weather and operating
conditions) and an asset component based on the construction, envelope
and major energy systems. The rating methods may be different for new
and existing buildings but should attempt to yield comparable ratings.
Existing ratings such as the Home Energy Rating System and the Energy
Star benchmarking system for commercial buildings may be the basis for
these ratings. To ease comparisons, the rating systems should include
the efficiency of a similar building that meets the model building
energy code as of the date of the rating and of a similar building that
meets Energy Star criteria.
These rating systems should form the basis for building energy
disclosure requirements. Rating and public disclosure of building
energy consumption should be required for all public buildings. For
privately-owned buildings, disclosure should be encouraged for the
parties to a purchase, finance or lease transaction along with annual
disclosure of operational ratings to tenants of large buildings. The
program should include provisions for DOE and EPA to work with states,
counties and local governments to implement programs that encourage
building owners to have publicly accessible certificates showing the
individual building's performance relative to similar buildings, the
building's energy efficiency potential, and the location and type of
transit services within walking distance of the building.
If implemented, building disclosure will directly save
approximately 8.2 billion kWh of electricity and 68 billion cubic feet
of direct natural gas, with carbon emissions reductions totaling
approximately 2.7 million metric tons in 2030. The policy would also
yield significant direct economic benefits including energy bill
savings for customers of $580 million in 2030. These are only direct
benefits from assessments conducted under the program. In addition, the
increased number and quality of building engineers and technicians will
enable substantial additional energy savings which we have not
attempted to quantify.
Residential Retrofits: The untapped potential of our homes to
operate efficiently is a drag on consumer spending, as dollars are
wasted on energy. Tapping in to this potential puts money in pockets
and creates durable, domestic jobs in home efficiency that can never be
sent overseas. Congress should act immediately to implement a national
home efficiency retrofit program to save Americans money and stimulate
the economy. This program would expand the EPA Home Performance with
Energy Star comprehensive retrofit program that now operates in 22
states and should encourage much greater participation in the program
by establishing rebates for homes that undertake comprehensive energy
efficiency retrofits. The rebate would be performance based, rewarding
higher levels of energy efficiency improvement with higher rebates.
Funding for the state-administered rebates could initially come out of
stimulus funds being given to states and cities, with longer-term
funding provided under climate legislation. The expanded program should
include support for the training of contractors and home energy raters
who would help implement the program. A more detailed description of
the program is attached to this testimony.
Significant environmental and economic benefits would result. For
homeowners, the benefits are meaningful and immediate. The average
homeowner will spend around $2,300 on energy bills this year, and a
performance retrofit will likely reduce these costs by about 25%,
corresponding to nearly $6,000 in energy savings through the 10th year.
This money represents extra cash for necessities or disposable income
that will be injected back into the larger economy. At a national
scale, the benefits of home retrofits are enormous. If the program
reaches a million homes per year the 10 year energy savings would be
enough to fully power about 15 million homes for a year. Scaling up the
home efficiency industry would provide about 50,000 net jobs. This
program has the support of more than 160 organizations and businesses
including energy and environmental advocates, contractors, and related
trade associations.
If implemented, residential retrofits will save approximately 26
billion kWh of electricity and 560 billion cubic feet of direct natural
gas, with carbon emissions reductions totaling approximately 13.3
million metric tons in 2030. Energy savings in 2030 total 0.84 quads
with energy bill savings for homeowners of $3.1 billion in that year.
Commercial Retrofits: Improving the efficiency of commercial
buildings can yield higher returns for owners, increase tenant
retention, and improve the productivity of workers, students, and
others using the facilities. Congress should establish a program that
would encourage the near term launch of large scale, deep retrofitting
of private and publicly owned commercial buildings or portfolios of
buildings. The program would provide an incentive to building owners
for efficiency improvements based on demonstrated energy savings of no
less than 20% with incentives calibrated to encourage 30% savings or
greater. The Energy Star Building benchmarking program would be used to
document and verify performance and the incentive would take the form
of a rebate per square foot. A loan guarantee, proportional to the
targeted energy savings level, would be established to enable upfront
investment in energy efficiency projects. Partial payment of the
incentive would be granted upon completion of the efficiency project
and with the remainder of the incentive conditioned on verification of
actual performance over a three year period. This proposal was
initially developed by the Real Estate Roundtable and NRDC. This would
be another program for which initial incentives might come out of
stimulus funds, with long-term funding incorporated into climate
legislation.
ACEEE estimates that commercial retrofits would save approximately
40 billion kWh of electricity and 266 billion cubic feet of direct
natural gas, with carbon emissions reductions totaling approximately
11.9 million metric tons in 2030. Energy savings in 2030 total 0.67
quads with energy bill savings for businesses of $2.6 billion in that
year.
Multi-Family and Manufactured Housing: Multifamily buildings and
manufactured (mobile) homes offer a vital opportunity to save
significant amounts of money through energy efficiency program
implementation. These housing types represent more than a quarter of
U.S. housing units and comprise 20% of residential energy consumption.
Multifamily and manufactured homes demand special attention because it
has proven difficult to implement efficiency programs targeting these
homes and the disproportionate numbers of low to moderate income
families have the greatest difficulty making efficiency investments
without assistance.\8\ Given the limited experience with such programs
to date, we recommend a process that will encourage a variety of
innovative approaches for trial and evaluation. The most successful
approaches could be developed into broader programs.
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\8\ According to the 2005 Residential Energy Consumption Survey
(EIA 2007), 71% of households in multi-family buildings and 80% of
households in manufactured housing are low-income (earning less than
$40,000), while 28% in each housing type are living below the poverty
line ($20,000).
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Past experience has shown that multifamily buildings have the
potential to realize energy efficiency savings up to, and even
exceeding, 20%. To tap the potential savings, we propose that Congress
establish a competitive grant program to seek creative solutions to
multifamily and manufactured housing efficiency. These programs would
be administered by DOE, with grants provided to state and local
government agencies as well as non-profit organizations to create
effective, replicable projects. Priority should be given to projects
that provide substantial energy savings while targeting recipients with
the greatest financial need. Prioritizing highly cost effective
programs with significant matching funds will help maximize the return
on investment of federal grant funds. A more detailed description of
the program is attached to this testimony ACEEE's preliminary estimates
indicate that this program would yield 0.15 quads of energy savings in
2030, with consumer energy bill savings of $570 million and carbon
emissions reductions of 2.4 million metric tons.
Energy Efficiency Resource Standard: Though not specifically a
buildings energy efficiency policy, the substantial majority of savings
from an energy efficiency resource standard would come from energy
efficiency improvements in residential and commercial buildings.
Providing each major electricity and natural gas distributor with a
simple and equitable target for achieving energy savings will serve to
drive investment in cost-effective energy efficiency as an energy
resource for large-scale acquisition. Eighteen states have enacted
successful energy efficiency resource standards; a national policy
would expand the savings and benefits throughout the country and yield
national emissions reduction and price reduction effects that would
benefit all states, including those that have already enacted the
standard. ACEEE estimates that by 2020, a well-designed federal energy
efficiency resource standard would reduce peak demand by about 90,000
megawatts with carbon emissions reductions totaling approximately 260
million metric tons in 2020. The policy would also yield significant
economic benefits including net energy bill savings for utility
customers of $144 billion and the creation of 260,000 net jobs. Our
analysis only looks at energy savings targets through 2020, and thus
energy savings drop off somewhat in 2030 as measures installed in
earlier years wear out. If targets are increased over the 2020-2030
period, much higher 2030 savings would result.
funding the recommended programs
In order to succeed, the new programs we recommend must receive
adequate funding. We see several potential mechanisms for allocating
the necessary program funds. State and local stimulus funds may be a
source of funding for programs with significant administration or
coordination by state and local governments, such as the Residential
Retrofit and Multifamily and Manufactured Housing program. Similarly,
any new stimulus funds could be directed toward the recommended
programs. Other potential sources include emissions allowances
resulting from climate legislation or appropriations made as part of
the normal budget process to allow for start up of climate-related
programs prior to final passage of climate legislation. Even if funds
are not available immediately, we recommend that these programs be
authorized so they are ready when and if funds become available.
Several new programs were authorized in the Energy Policy Act of 2005
and Energy Independence and Security Act of 2007 and first funded under
the American Recovery and Reinvestment Act. We anticipate a similar
process with emerging 2009 energy legislation authorizing programs that
could be funded under future climate legislation.
overall savings
ACEEE has developed estimates of energy savings and carbon
emissions reductions associated with each of the recommended policies
and program. The table below summarizes our preliminary estimates of
savings for each provision we discuss. Together, the recommended
improvements to existing policies and adoption of new policies and
programs will save 3.19 quads of primary energy in 2030, avoiding
41,000 mega-watts of peak demand and creating annual consumer energy
bill savings of $12 billion. The peak demand reductions are equivalent
to the output of 136 300-MW power plants. Carbon emissions reductions
from the buildings programs will total approximately 53 million metric
tons in 2030, the equivalent of taking 9 million cars off the road.\9\
Substantial additional energy will be saved by the Energy Efficiency
Resource Standard.
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\9\ Note: Based on 6 metric tons of CO2 per vehicle per
year.
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conclusion
Buildings represent the largest energy using sector of the U.S.
economy. Improving the energy efficiency of our new and existing
building stock should be a core component of our energy and climate
policies. The policies and programs recommended above will impact all
Americans by reducing energy expenditures, creating jobs, and cutting
carbon emissions. We urge you to give serious consideration to these
policies and to include them in upcoming energy legislation.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thank you very much.
Mr. Hubbell, go right ahead.
STATEMENT OF WARD HUBBELL, PRESIDENT, GREEN BUILDING
INITIATIVE, PORTLAND, OR
Mr. Hubbell. Mr. Chairman, Ranking Member Murkowski, and
Senators: I appreciate the opportunity to come and talk to you
today. I'd like to talk to you about voluntary green building
rating systems and the role that we have seen that they can
play in accelerating our common objectives of improving our
energy efficiency in buildings.
I represent the Green Building Initiative, which is a
nonprofit organization dedicated to accelerating the adoption
of green building practices by mainstream builders and
designers. First let me say that we strongly support the
increased focus on improving the energy efficiency of existing
buildings. New building design remains a very important issue,
but existing buildings represent a much larger opportunity for
improvements.
According to the DOE's building data base, there are fewer
than 200,000 new commercial buildings constructed each year
versus more than 5 million that exist today. So the opportunity
for improvement there is fairly obvious.
My organization owns the U.S. rights to the Green Globes
Environmental Assessment and Rating System for Commercial
Buildings. Green Globes is web-based and interactive and
therefore easy to use and affordable for any type of building
or budget. Green Globes includes two modules, one for new
construction and one for existing buildings. They can be used
separately or together to create an ongoing cycle of
benchmarking, measurement, and improvement.
Because of its affordability and ease of use, Green Globes
has been used to evaluate dozens of U.S. Federal buildings as
well as State and local government facilities, like the
Arkansas Department of Environmental Quality Headquarters and
the Summit County, Colorado, Recycling Center. Green Globes has
been used by higher education institutions, like Drexel
University, who recently certified their entire campus, and a
number of local school districts.
It's also been used by a growing list of global
corporations like Dow Chemical and Newell Rubbermaid that need
a credible but cost-effective certification for a large
portfolio of commercial buildings.
Voluntary green rating systems like Green Globes help
incentivize building design and building operation in three
important ways. First, they define goals beyond mandatory code
in critical areas such as energy conservation and carbon
reductions.
Second, they provide the means to measure progress against
these goals so that building owners can set priorities, measure
outcomes, and plan improvements.
Third, rating systems create a market dynamic that rewards
those who go beyond what is required. The financial sector, for
example, has begun to reward green certification through green
insurance policies and green mortgages, and there is mounting
evidence supporting the marketing benefits of green building
certification.
Now, given the interest and goals of this committee, I
would now like to describe how Green Globes addresses energy
efficiency and carbon reduction specifically. To our knowledge,
Green Globes allocates a greater percentage of its points
toward energy conservation than any other comprehensive green
building rating system in operation today. More than a third of
its points are weighted in energy and a building must first be
at least 25 percent more efficient than average before earning
any points in energy.
Our system is integrated with U.S. EPA's Energy Star
program and benchmarks against actual building data from the
building Department of Energy CBECS data base. We currently
report on carbon emissions based on direct energy consumption
and in our next version of the standard we will require a
performance goal that is based on calculating carbon dioxide
equivalency in order to reflect the true carbon footprint of
the building.
We will also incorporate scoring to reflect cradle-to-grave
carbon emissions and embodied energy of hundreds of common
building assemblies, so that material selections can also be
evaluated against global climate impacts.
Green Globes is the only green building rating system that
requires a rigorous onsite building inspection prior to
certification, and will soon become the first and only American
national standard for commercial green buildings. A similar
ANSI standard, I should note, for residential green building
was recently published by the National Association of Home
Builders and the International Code Commission.
In conclusion, I'd like to leave the committee with three
observations. First, green design is important, but it's only
part of the equation. Effective building operation and
maintenance is necessary for substantial nationwide reductions
in energy use and carbon emissions.
Second, although good energy benchmarking data exists
through the Department of Energy and EPA's Energy Star program,
there is a need for better data on building performance. The
State of California's Cal Arch data base appears to be a good
model and we would encourage the DOE to look closely at it.
Finally, while many will follow good green design and
construction practices because it's the right thing to do, many
more will do so for an economic return. For that reason, better
information on the economic benefits of certified green
buildings will likely increase their numbers.
Thank you very much.
[The prepared statement of Mr. Hubbell follows:]
Prepared Statement of Ward Hubbell, President, Green Building
Initiative, Portland, OR
Chairman Bingaman, Ranking Member Murkowski and members of the
committee, thank you for the opportunity to discuss voluntary green
building rating systems and the role they can play in helping to
increase the energy efficiency of buildings nationwide.
I represent the Green Building Initiative, a non-profit
organization dedicated to accelerating the adoption of green building
practices among mainstream design and building professionals.
First let me say that we strongly support the increased focus on
improving the efficiency of existing buildings. While new building
design remains a very important issue, existing buildings represent a
much larger opportunity for energy improvements due to sheer numbers.
On average, there are fewer than 200,000 new commercial buildings
constructed each year, versus 5.5 million that exist today, many of
which could be made significantly more energy efficient.
about green globes
My organization owns the US rights to the Green Globes
environmental assessment and rating system for commercial buildings.
Green Globes is unique in that it is web-based and interactive, and
therefore easy to use and affordable for any building type or budget.
Green Globes includes two modules--one for new construction and the
other for existing buildings. They can be used separately or together
to create an ongoing cycle of benchmarking, measurement and
improvement.
Because of its affordability and ease of use, Green Globes has been
chosen for evaluating buildings:
By federal agencies such as the US Departments of Health and
Human Services, Interior, Veterans Affairs, State and the
General Services Administration.
By local governments like Summit County, Colorado; and state
agencies such as the Arkansas Department of Environmental
Quality;
By higher education institutions like Drexel University and
a number of local school districts; and
By a growing list of global corporations with a need for
credible but cost effective certification.
how green rating systems can accelerate energy efficiency
Voluntary green building rating systems like Green Globes can help
incentivize better building design and operation in three important
ways:
First, they define goals beyond mandatory codes in critical
areas such as energy conservation and carbon reductions.
Second, they provide the means to measure progress against
these goals so that building owners can set priorities, measure
outcomes and plan improvements.
And third, rating systems create a market dynamic that
rewards those who go beyond what is required. Private sector
incentives such as green insurance products and green mortgages
are evidence of the financial sector's response to green
certification and there is a growing body of information
supporting the marketing benefits of green building
certification.
green globes and energy
Given the interests and goals of this committee, I would now like
to describe how Green Globes addresses energy efficiency and carbon
reduction.
To our knowledge, Green Globes allocates a greater percentage of
its points toward energy conservation than any other comprehensive
green building rating system in operation today. More than a third of
our points are weighted in energy and a building must be at least 25%
more efficient than average before earning any points for energy
consumption.
Our system is integrated with US EPA's ENERGY STAR program and
benchmarks against real building data from the US Department of
Energy's Commercial Buildings Energy Consumption Survey (or CBECS)
database.
We currently report on carbon emissions based on direct energy
consumption and in the next version of our tool, we will require a
performance goal that is based on calculating carbon dioxide
equivalency (or CO2e). Additionally, the cradle to grave
carbon emissions and embodied energy of common building assemblies has
been addressed and weighted helping teams to evaluate their material
selections against global climate impacts as well.
Because credibility is a key to the success of an organization such
as ours, it is also worthwhile to note that GBI has a rigorous third-
party assessment requirement. Highly trained and qualified assessors
review paperwork to assess evidence of compliance to our protocols as
well as visit the building prior to awarding a Green Globes
certification. We are the only green building rating system to include
site visits as a requirement to certification.
Finally, GBI has further elevated the level of rigor expected of
green building rating systems by being the first to take a commercial
building rating system through a third-party codified consensus
process. As such, GBI is on track to release this year the first
American National Standard for commercial green buildings, which will
incorporate the improvements mentioned earlier in my testimony.
I will also note that there is already an American National
Standard for residential green building, which was recently published
by the National Association of Home Builders and the International
Codes Council. Truly, these organizations and ours are working to make
mainstream buildings and the concept of going `beyond code' more than
just a lofty goal.
conclusion
In conclusion, I'd like to leave the committee with three
observations:
1. Green design is important, but it's only part of the
equation. Effective building operation and maintenance is
necessary for substantial nationwide reductions in energy use
and carbon.
2. Although good energy benchmarking data exists through the
Department of Energy, and has been built upon by the EPA
through the Energy Star program, there is a need for more
Energy Star tools and better data on building performance. I
note for the committee that the state of California's Cal Arch
database appears to be a model worth investigation and we would
encourage the federal government to look closely at it and
other efforts that can further build and improve upon on our
existing baseline data.
3. Finally, while many will follow good green design,
construction, and operations practices because it's the right
thing to do, many more will do so for an economic return on
investment. For that reason, more and better information on the
economic benefits of certified green buildings and Energy Star
buildings will likely increase their numbers.
The Chairman. Thank you very much.
Mr. Zimmerman, go right ahead.
STATEMENT OF CHARLES ZIMMERMAN, VICE PRESIDENT, INTERNATIONAL
DESIGN AND CONSTRUCTION, WAL-MART STORES, INC., BENTONVILLE, AR
Mr. Zimmerman. Chairman Bingaman, Ranking Member Murkowski,
and distinguished members of the committee: My name is Charles
Zimmerman. I'm International Vice President of Design and
Construction for Wal-Mart Stores, Inc., and I'd like to thank
you for your work on this important issue, for holding this
hearing today, and for inviting us to appear.
Since energy is Wal-Mart's second largest operating
expense, it should be no surprise that we have been focused on
energy efficiency practically since our founding. We have
always recognized what many others have not: Energy truly is a
controllable expense.
Because nearly one-third of Wal-Mart's energy consumption
is in the form of lighting, we have developed over the years
one of the most energy efficient lighting systems in the world.
In fact, the installed lighting load in one of our newer stores
is nearly 50 percent less than the baseline requirements
established in the Energy Policy Act of 2005. This truly
innovative system results in the fact that during daylight
hours our sales floor lighting is either off or significantly
dimmed. This is possible thanks to a sophisticated daylight
harvesting system comprised of hundreds of skylights per store,
that are connected to sensors and state-of-the-art control
technologies. This allows our sales floor lighting system to
continually modulate the amount of energy needed based on the
natural light available.
This system is so dynamic that it even gradually ramps the
lighting levels up and down as clouds pass over the store. The
result is a building where most of the lighting is dynamic and
only on to the degree that conditions warrant. This is just
lighting. Similar efforts are under way with HVAC and
refrigeration.
Recently, at the request of Wal-Mart, Lennox International
has developed a new rooftop heating and air conditioning unit
that it has marketed as being, and I quote, ``the most
efficient unit of its kind,'' end quote. Lennox also states
that this equipment is up to 66 percent more efficient than
U.S. Department of Energy regulations. Today every rooftop unit
purchased in the U.S. and Canada for all of our new stores and
retrofits is this Lennox super-high efficiency unit.
Of course, as efficient as all this equipment is, without
proper control technology it will never meet expectations. That
is why every Wal-Mart store in the U.S. includes a
sophisticated energy management system that allows us to
monitor and control the lighting, temperature, humidity, and
refrigeration in each and every one of our stores from our home
office in Bentonville, Arkansas. If an associate in Denver
leaves the door to a walk-in cooler open, we know it. If a
store manager in Bernalio overrides the daylight harvesting
system, we know it. If a freezer in Ketchikan is icing up and
needs defrosting, we know it, and we can do something about it
from Bentonville.
As efficient and forward-thinking as our energy practices
have always been, we have very aggressive goals in our
sustainability and energy efficiency efforts for the future as
well. In October 2005 we announced plans to reduce the
greenhouse gas emissions in our already energy efficient
existing buildings by another 20 percent by 2012. We also
announced plans to develop a new store prototype that will
increase efficiency by another 25 to 30 percent by October
2009.
So how are we doing in achieving these goals? With regards
to our existing stores, we recently approved capital for this
year alone for more than 1,200 energy-related retrofit projects
in our 4,000 U.S. stores. This is on top of a similar program
last year and more than likely a similar program next year. A
majority of these projects have paybacks between 2 and 3 years.
When it comes to our new store program, we have been equally
aggressive and have seen promising results there as well.
As proud as we are of these accomplishments and
innovations, we're even more proud to share what we are
learning with everyone, including our competitors, like Target,
Best Buy, and Costco, and several Federal agencies like the
EPA, DOE, and OMB. The best thing about the information we are
sharing is that it's not theory; it is proven results of real
initiatives with real paybacks.
While Wal-Mart is not waiting for legislation to cause us
to act proactively in the area of energy efficiency, we would
encourage Congress to continue to look at new incentives that
will help others to act proactively as well, whether it be
expanding the penetration of smart metering or smart grid
technologies or adopting energy efficient building codes which
set a floor for building performance to ensure that the lowest-
hanging fruit of efficiency upgrades are met at abroader range
of buildings.
We hope that our experience proves insightful and helpful
and we stand ready to assist you in any way we can.
Finally, as you contemplate energy policy we encourage you
to remember the every day Americans like the roughly 150
million shoppers who pass through our U.S. stores every week.
More than ever before, we see these consumers struggling to
make ends meet. We see them choosing between healthy food or
their prescription medication. We see them leaving the toys out
of the cart to make room for baby formula and diapers.
At Wal-Mart our energy efficiency practices not only help
us save energy and protect the environment; they also help us
keep costs low for our consumers.
We at Wal-Mart applaud Congress in its efforts to
communicate the necessity and the benefits of energy
efficiency.
Thank you for your time and allowing me to speak on behalf
of Wal-Mart on this very important topic, and we look forward
to working with you to effectively and constructively address
these issues. Thank you.
[The prepared statement of Mr. Zimmerman follows:]
Prepared Statement of Charles Zimmerman, Vice President, International
Design and Construction, Wal-Mart Stores, Inc., Bentonville, AR
Chairman Bingaman, Ranking Member Murkowski and distinguished
Members of the Committee:
My name is Charles Zimmerman, and I'm Vice President of
International Design and Construction for Wal-Mart Stores, Inc. In my
current role, I'm responsible for coordinating the Architectural and
Engineering System Design for all of our international retail
facilities.
Prior to joining Wal-Mart's international division earlier this
month, I was the U.S. Vice President of New Prototype Development and
the captain of the Sustainable Buildings Network, where I oversaw our
company's efforts to make our buildings more energy and water
efficient, and lower their overall environmental impact. In that role,
I led a team of architects and engineers to experiment, pilot, and
deploy a range of clean technologies in our buildings. I helped design
Wal-Mart's most recent two experimental stores--where we test a range
of emerging technologies in real world applications; and then develop
our fleet of High Efficiency stores across the country where we pilot
promising technologies from our experimental stores to see how they
succeed in different climatic regions; and finally deploy the most
successful technologies across all our new store prototypes and into
our retrofit of existing stores.
On behalf of Wal-Mart and our 2.2 million associates around the
world I would like to thank the Committee for its work on this
important issue and for holding this hearing today. Wal-Mart
appreciates the opportunity to participate in this critical discussion.
Our company holds a unique position in the world of energy. While
there are no firm statistics, it is widely understood that Wal-Mart is
one of the largest ``private'' purchasers of electricity in the United
States. In fact, the only entity thought to purchase more energy in the
U.S. than Wal-Mart is the U.S. Government. Since energy is also Wal-
Mart's second largest operating expense, it should be no surprise that
we have been focused on energy efficiency practically since the day we
were founded.
Fortunately, our global presence gives us a great opportunity for
energy efficiency comparisons. As Wal-Mart has continued to expand into
other countries, our primary mode of expansion has been to acquire
existing stores in those countries. Therefore, it is interesting to
note that the stores we have built in the US are actually more energy
efficient than those we have acquired in any other country thus far.
This is even true for stores in countries with much more stringent
energy regulation and much higher utility rates than the US; such as
the UK and Japan. In fact, our stores in the UK actually use twice the
energy per square foot, and our stores in Japan one and a half times as
much energy per square foot as our stores in the US.
We have always recognized what many others have not: energy is a
controllable expense.
Because nearly one-third of Wal-Mart's energy consumption is in the
form of lighting, we have developed during the last decade, what we
feel, is one of the most efficient lighting systems in the world. In
fact, the installed lighting load in one of our newer stores is nearly
50% less than the baseline requirements established in the Energy
Policy Act of 2005.
This truly innovative system results in the fact that during
daylight hours, our sales floor lighting is either off (or at the very
least) significantly dimmed. This is possible thanks to a sophisticated
daylight harvesting system comprised of hundreds of skylights per store
that are connected to a sensor and state of the art control technology.
This allows our sales floor lighting system to continually modulate the
amount of energy needed, based on the natural light available. This
system is so dynamic that it even gradually ramps the lighting levels
up and down as clouds pass over the store. In our non-sales floor areas
such as offices, break rooms and restrooms, lighting is controlled by
occupancy sensors that turn off the lights when no one is in the space.
Even our freezer case lighting has now evolved into a display of
advanced technology as it is now comprised of ``LEDs'' or ``Light
Emitting Diodes''. The result is a building where most of the lighting
is dynamic and only ``on'' to the degree that conditions warrant.
And this is just lighting; similar efforts are underway with HVAC
and refrigeration.
At the request of Wal-Mart, Lennox Industries has developed a new
rooftop heating and air-conditioning unit that it marketed as ``the
most efficient unit of its kind''. Lennox also states that this
equipment is ``up to 66% more efficient than U.S. Dept. of Energy
regulations''. EVERY roof top unit purchased in the US for all of our
new stores and retrofits for over the past year has been this unit.
Of course as efficient as all of this equipment is, without proper
control technology it will never meet expectations. That is why every
Wal-Mart store in the US includes a sophisticated energy management
system that allows us to monitor and control the lighting, temperature,
humidity and refrigeration in each and every one of our stores from our
home office in Bentonville, Arkansas.
If an associate in Sacramento leaves the door to a walk-in cooler
open, we know it. If a store manager in Chicago over-rides her daylight
harvesting system, we know it. And if a freezer in Miami is icing up
and needs to be defrosted, we know it. And we can correct the situation
from Bentonville.
As efficient and forward-thinking as our energy practices have
always been, we have very aggressive goals in our sustainability and
energy efficiency efforts for the future.
In October of 2005, we announced plans to reduce the greenhouse gas
emissions in our already energy-efficient existing buildings by another
20% by 2012. We also announced plans to develop a new store prototype
that will increase efficiency another 25%--30% by October of 2009.
So, how are we doing in achieving these goals?
With regards to our existing stores we recently approved capital
for more than 1,200 energy related retrofit projects in our existing
4,000 US stores. This is on top of a similar program last year, and
more than likely a similar program next year. A majority of these
projects have paybacks between two and three years. And remember, these
are in already efficient stores that have daylight harvesting systems,
heat reclaim systems, energy management systems, etc.
When it comes to our new store program, we have opened in the last
two years 8 of what we refer to as our ``higher efficiency''
prototypes. These stores are predicted to be up to 20-40% more
efficient than our earlier prototypes, depending upon the climate zone.
We are now in the midst of a 6 month strenuous audit of these
facilities until the end of July in order to quantify exactly what the
savings are prior to rolling them out to our entire program.
As proud as we are of these accomplishments and innovations, we are
even more proud to share what we are learning with everyone, including
our competitors.
In the past two years or so we have shared the details on our
energy initiatives and their related paybacks with the Environmental
Protection Agency, the US Department of Energy, the Defense Science
Board, the Office of Management and Budget and with our retail
competitors, Office Depot and Best Buy. We have even shared our story
with the Pentagon and with the National Academy of Science. We have
also taken representatives from Food Lion, Target, Publix, Costco and
many others on tours of our recently opened stores that featured some
of our newer energy efficient technologies. The best thing about the
information we are sharing is that it is not theory; it is the proven
result of real initiatives with real paybacks.
I am often told by others that until there are new technologies or
until there is additional legislation, energy efficiency will never
achieve mainstream attractiveness. Believe me, the technology exists,
we are proof of that, and while Wal-Mart is not waiting for legislation
to cause us to act proactively in the area of energy efficiency, we
would encourage Congress to continue to look at new incentives that
will help others to act as well, whether it be expanding the
penetration of ``smart metering'' and ``smart grid'' technologies that
would allow utilities, businesses and individuals to enjoy the kind of
energy saving information management abilities that we have adopted; or
adopting energy efficient building codes which set a floor for building
performance to ensure that the lowest hanging fruit of efficiency
upgrade benefits are met at a broader range of buildings. We hope that
our experience proves insightful and helpful and stand ready to assist
you in any way we can.
Finally, as you contemplate energy policy, we encourage you to
remember the kinds of everyday Americans like the roughly 150 million
shoppers who pass through our U.S. stores every week. More than ever
before, we see these consumers struggling to make ends meet--we see
them choosing between healthy food or their prescription medication; we
see them leaving the toys out of the cart to make room for baby formula
and diapers. At Wal-Mart, our energy efficiency practices not only help
us save energy and protect the environment, they also help us keep
costs low for our consumers.
And by making sure we have everyday low prices on products like
energy efficient light bulbs, home winterization kits, and cold-water
laundry detergent, we are helping Americans save money on energy costs,
and live better.
In conclusion, I'm very proud to work for a company that has
committed to, and is actively moving towards, a goal of eventually
being supplied by 100% renewable energy; I am proud to work for a
company that is demonstrating its commitment to environmental
sustainability while saving consumers money; and I am proud that the
company encourages me to pro-actively share our innovations with the
world.
We at Wal-Mart applaud Congress in its efforts to communicate the
necessity and the benefits of energy efficiency.
Thank you for your time in allowing me to speak on behalf of Wal-
Mart on this very important topic. We look forward to working with you
to effectively and constructively address these issues.
The Chairman. Thank you very much. Thank you all for your
excellent testimony.
Just for the information of folks, I've got a note here
that we're going to have probably two roll call votes starting
about 3:45. So I'll take 5 minutes and ask questions and then
I'm sure my colleagues will, and we'll see if anyone else has
questions after that.
We're trying, as you all know, to figure out what this
Congress could do and the Federal Government could do to
accomplish the objectives that you've all talked about in
various ways. One of the suggestions, one concrete suggestion,
is the one that Ms. Amann refers to and that is that we take
this provision that the House of Representatives passed in 2007
containing a provision calling for the Departments of Energy
and State to update energy codes for new buildings. The
provision directed the Department of Energy to support efforts
by model code organizations to update building codes to reduce
energy use of new buildings by at least 30 percent by 2010 and
50 percent by 2020.
Let me ask some of the rest of you. Ms. Amann, you're on
record saying we ought to go ahead and adopt that. Are some of
the rest of you familiar with that? Is that the right way to
go? Mr. Mazria, do you think that's the right way for us to go,
or should we do something different or in addition to that?
What are your thoughts?
Mr. Mazria. I think it's the right way to go, but I think
it needs to be tightened up a little bit. We have a group that
talks, of about 15, 20 organizations, and we've come to I think
a tentative conclusion that we ought to go on a 6-year cycle:
2010, 30 percent; 2016, 50 percent; and then on out, giving the
DOE the authority to tighten it up as we move out in time. I
think you'll find that most organizations will support that.
The Chairman. Now, this really just addresses new building
construction as I understand it?
Mr. Mazria. I think it's if you go in for a building--if
you go in for a permit, then----
The Chairman. Then you have to update.
Mr. Mazria. Then you'd have to update, yes.
The Chairman. Upgrade to the code.
Mr. Mazria. Yes.
The Chairman. Is there something in addition to this? If we
were to take your new improved version of this House-passed
legislation and go with that, is that sufficient to the purpose
or should there be something else that relates to retrofitting
existing buildings. Or what are your thoughts there? Go ahead.
Mr. Mazria. On that point the discussion has been around
reach codes. What reach codes are is for the Department of
Energy to actually generate codes that go out in time, but make
them available for cities and States and counties to adopt if
they want to be out in front, because right now you have many
cities and States that are adopting standards that are much
better than code. You have Dallas, you have albuquerque, you
have Santa Barbara. There are all sorts of cities, and these
codes are all over the place.
So if we have a set of standards that cities and States can
adopt, that are way beyond code, that would be really helpful.
But that has to take precedence over any appliance and
equipment minimum standards that the reach codes would have to
take precedence. I think that would stimulate a lot of
innovation in this country.
The Chairman. Mr. Giudice, I think you referred to the
International Energy Codes that you've adopted, I guess, up in
Massachusetts. How does that relate to what I've been asking
about here? I mean, is this the same thing?
Mr. Giudice. It is similar. There's ASHRAE and the
International Energy and Conservation Codes, which are parallel
code bodies. The idea of going to a 30 percent better is a good
step. I do think that DOE should be tasked with the idea of
maybe going to 50 percent better on a national code basis at
this juncture and to get back to the Congress as to whether or
not that's doable. So that that would push us even further
faster on this.
The International Energy Conservation Code, which drives a
lot of the energy code-setting, is a body that has had sort of
a difficult process to really move codes further. there was an
important initiative this last summer to move it to a 30
percent step and the process did not result in getting to that
30 percent step because there was so much sort of resistance to
that kind of a change. It ended up getting I think a 12 or 13
percent improvement of the International Energy Conservation
Code.
It signifies to me the difficulty of these sort of
incremental processes that are being tried to be worked on
almost a voluntary basis on the national. Great intentions,
great collaboration, but it sort of gets to be they get kind of
ground round to the lowest common denominator, instead of
aspirational and more significant steps, which I think this
policy code do, as well as, as Ed was indicating, initiating
every specific potential stretch codes for towns and States to
adopt in addition to the base Federal codes.
The Chairman. My time is up. Senator Murkowski.
Senator Murkowski. Thank you, Mr. Chairman.
Mr. Zimmerman, I was suggesting to the chairman up here
that we in the government could use a little bit of help. If
you guys know that a refrigerator needs defrosting in Ketchikan
and you can do something about it in Bentonville, Arkansas, we
could use your help here.
Mr. Zimmerman. We'd love to help you replace these
incandescent lights.
[Laughter.]
Senator Murkowski. Actually I was going to suggest, Mr.
Chairman, you spoke about dynamic lighting. Do you think the
way that we should start is by opening up the blinds and by
getting some natural daylight in here. We do need to work on
this.
Mr. Zimmerman. Senator, you might also note that the air
conditioning is on in this room in February, to offset the heat
gain from those lights.
Senator Murkowski. We are probably the best example of the
highest inefficiency in lighting and in cooling and heating
here in these buildings. We need to be a better role model in
this area. So I appreciate you pointing that out.
Professor Majumdar, you spoke to the integration and how we
can be smarter in these systems. The comment that you made was
that ``design and performance don't always match.'' We have
great plans in mind, but if the systems don't come together in
your building--if you're doing things right in one room and
right in another room, but they're not talking to each other,
we can be at odds and basically defeating this efficiency.
How do we adequately allocate the $4.5 billion from the
stimulus bill?
I was quite concerned to learn that we don't have standards
that are clearly set, to allow for this interoperability, and
exchange of communication. It sounds like we're doing much the
same when talking about efficiencies and making sure that we
have a level of interoperability and a connection.
How do we make sure that we've got integrated systems when
we're putting those buildings together or when Wal-Mart is
retrofitting some of their old stores. Are we able to do what
you have said we need to do in terms of integration.
Mr. Majumdar. Thank you, Senator Murkowski. I think that's
a great question. I think in terms of integration--first of
all, let me just say that you mentioned the stimulus as well. I
think this is a great opportunity. Obviously with the stimulus
we want to create jobs immediately and we want to put their
double-pane windows and fluorescent lighting, etcetera.
But I think this is a great opportunity to put in a
measurement security to actually what we are doing is working
or not, so that once, 2 years from now, 3 years from now, we
can actually quantify that this is actually happening. That's
sort of the basic--if you want to see what's going on 2 years
from now, we'll have some numbers. So that's one.
The second thing is the integration today. As I mentioned,
it's not working in most buildings and the buildings are
fighting each other: We are using HVAC cooling when we are
almost freezing outside. That's part of the integration.
So if you think about, let's say, a computer. It has a
microprocessor, it has a display, it has memory. How does it
integrate? It integrates because of a few things. There's an
operating system that coordinates the activity of all that, and
that operating system, if you may, for a building is not there
today. We need to develop the science and technology, the
engineering----
Senator Murkowski. Do we have that science and technology,
that engineering?
Mr. Majumdar. Absolutely. We have elements of that and we
need to devote some R and D toward developing the sort of open
source, the integration, the building operating system. Right
now the building operators are doing a heroic job trying to
manage thousands or hundreds of zones and trying to use their
intelligence, which is great. But at some point when the
building becomes really complex and it's fighting each other--
you know, the building operator, it's asking too much of them.
I think some element of automation is a good thing out here,
just like we have in other sectors. I think that's where some
of the R and D ought to be focused.
Senator Murkowski. I know that the chairman and I are
working on some legislation that would hopefully speak to
exactly what you're talking about within the R and D area.
Mr. Giudice, you mentioned the energy labeling and I think
it was Mr. Hubbell that also spoke to the energy certification.
I think your reference was: When you buy a car, on the sticker
it tells you your expected miles per gallon and other details.
But that is when you first buy the car, but a couple years
down the road, if perhaps you haven't kept up with your tune-
ups. The performance isn't really there.
In terms of energy labeling, are we envisioning this to be
static or how do we make sure that there's continual truth in
advertising with our energy labeling?
Mr. Giudice. Yes, it's an important issue. As some speakers
have talked about it, it can't be just about what the design
was. It has to be about how it's actually operating. So I think
at every significant transaction--when a new lease owner comes
in, when a building is sold--there has to be a public
disclosure of what the energy consumption on a per square foot
basis is for that building and how that ranks and rates against
similar usage type buildings in similar climates.
It's very doable. We're actually working a zero net energy
building task force in Massachusetts and that's one of the
recommendations that's going to come out of that.
Senator Murkowski. Do you have energy auditors that would
go in and do that assessment?
Mr. Giudice. It's not even requiring energy auditors. You
can use Web-based tools to load up what the energy consumption
has been. We're going to take all public buildings actually in
Massachusetts, both State and local, and load up the data so
that we're watching the energy consumption, we'll know the
square footage of them and we can rank and rate them
accordingly, and start the public disclosure of what our
building consumptions are.
Energy Stars are useful. That has a useful profiler tool
that can help bring some of that in. It's just a matter of
building on what exists today.
I did want to touch on the building control systems. There
is standards like Zigby that actually are interoperability
standards for new building control systems. I worked with a
company INTERNOC--I've only been in public service here for 2
years--that is working nationwide on talking to building
control systems and enabling them to drop load when the peak
demands are really high, and working with even proprietary
systems as well as some of the open architecture systems.
So there's a lot of technology that exists today. It's just
a question of rolling it out and making it more widespread.
Senator Murkowski. Thank you.
Thank you, Mr. Chairman.
The Chairman. Thank you.
Senator Cantwell.
Senator Cantwell. Thank you, Mr. Chairman, and I thank the
panelists for being here.
Professor Majumdar, I wanted to start with you if I could
about standby power. Obviously, you probably know a lot about
what we're doing at the Federal Government on standby power,
but its obvious focus is on domestic appliances and the use of
power that they consume when they're in off mode. The estimates
are they account for about 10 percent of all household power
consumption.
In the 2007 bill, we inserted the requirement that
electronic devices purchased by the Federal Government use less
than one watt of power while in standby mode. Do you have some
assessment of how we're doing with this? I know the House
expanded that language, but how well are Federal agencies doing
in complying with this, and what else we need to do?
Mr. Majumdar. Thank you for the question, Senator Cantwell.
I think this is a very important issue. There's a lot that can
be done. I'm not the expert in this, but there are people in my
staff in LBL who are working on this. From my understanding,
right now it's about 10 percent, about 40 appliances on average
in California.
That there is technology that exists that could bring down
to a few percent, like 1 or 2 percent. But right now I think if
I remember in ISA 2007 it sort of goes appliance by appliance,
whereas this is a horizontal issue and so one could do it
sweeping it at one level and that could be done.
In terms of actual progress that has been made, that's a
matter for the Department of Energy. I don't know exactly how
it is progressing. I can get back to you on that after talking
with DOE.
Senator Cantwell. You don't think anybody's measuring it?
Mr. Majumdar. I am not familiar with it. I'm not quite
sure, but I can get back to you.
Senator Cantwell. OK. Thank you. We'll ask DOE. But you
think it's an important area for us in building savings?
Mr. Majumdar. It is a low-hanging fruit. It has to be done.
Senator Cantwell. Thank you.
The other issue I'd like to ask either Mr. Zimmerman or Mr.
Hubbell about is China. While we're focusing here on the United
States, China is expected to have half the world's building
construction in the next 10 years. So while we look at what's
happening in the United States, obviously it's no comparison to
what will happen in China. They are less efficient per square
meter on their building code standards.
I was interested in what either one of you think are the
opportunities for us to work with them. The Pacific Northwest
Lab is already working with them to try to help get energy
efficiency standards compliance in China. But I was wondering
what potential you see there for U.S. markets in lighting,
motion sensors, advanced windows, all of that.
Mr. Zimmerman. Actually, we rank all of the countries we
operate in, nearly 20 countries now, and China ranks about
third or fourth in energy efficiency. Of course, our stores in
China are fairly new. While we have a 25 to 30 percent goal for
our new buildings in the U.S., China actually--Wal-Mart China
has a 40 percent goal.
In Beijing we recently opened up our first store that is
100 percent lit with LED lighting. While we're using a lot of
LEDs in the U.S., our general sales floor lighting is still T8
fluorescent. In our Wal-Mart China store in Beijing it's all
LED. They're also doing things with motion activation on their
cases, etcetera.
So we're working with our suppliers in China. We recognize
that our global greenhouse gas footprint is small compared to
our suppliers, and a lot of those suppliers are based in China.
So we're working not only with our suppliers, but our stores,
to even exceed our U.S. goals.
Senator Cantwell. Mr. Hubbell.
Mr. Hubbell. Senator, we're a domestic organization, so I
don't have a lot to say about China, other than to point out in
our part of the world, the Pacific Northwest, there's a lot of
design expertise in building design, building operation, that I
know is being exported to China. I think that's a very good
thing.
The other thing I would say about that is in the rating
system business, which is the business that I'm in, I think
that there can be some helpful things in China if we share with
them the expertise we have in evaluating buildings, recognizing
that a plaque on the wall is not the objective; the performance
goal is the objective. But I think educating the Chinese and
others about how market dynamics and other things can be
created through recognition and certification I think could be
something that we could talk to them about.
Mr. Zimmerman. May I add one more thing, Senator? My title,
``International Vice President, Design and Construction,''
that's new for me. Until a month ago I was in our U.S. program.
Part of the reason I'm in international now is to take the best
practices we're learning in the U.S. share them with our other
countries, and vice versa. Many of the things we're doing in
the U.S. we're doing in China. We're watching closely this LED
experiment in China so that we can roll it out to our other
countries as well.
Senator Cantwell. I'm very appreciative of the best
practices, but I look at this and I think this is an enormous,
enormous opportunity for U.S. businesses and companies and
services that they provide on efficiency. If China's going to
have half of the buildings in the world in the next 10 years,
then having U.S. access to those markets to help them would be
a great source of economic revitalization for us.
So thank you for your work.
The Chairman. Senator Sessions.
Senator Sessions. Thank you, Mr. Chairman.
Mr. Zimmerman, being of a practical bent, let me ask you,
does Wal-Mart take the view that all of their energy
conservation practices should pay for themselves over some
period of time in savings? In other words, the cost of
implementing the new system you desire to pay for itself?
Mr. Zimmerman. You know, I don't know if that--that's not
necessarily a policy, but that's the reality. When I present
any initiative, I present a payback, and so far those paybacks
have been in the 2- to 3-year range. Given the environment
today, that's an easy decision for our company to make, is to
invest in those type technologies.
Senator Sessions. That is very easy to invest in. Anything
that will pay back in 2 or 3 years I think is clearly a winner.
What about 5, 6, 8, 10 years? Is there some point that a
business would begin to wonder or you would have a cutoff as to
whether it would be good business?
Mr. Zimmerman. Currently, if it's in the 5- to 6-year range
we target our new store construction first and we work through
making things more efficient, value engineering the process, so
that we can drive the return even better to get it into our
retrofit program. If you're starting to get out 10 years, we'd
have to start looking at other benefits from a standpoint of
maintenance, etcetera.
But again, we haven't run across any initiatives that
really get beyond about that 5-year window.
Senator Sessions. So how much have you reduced, say in a
model store, how much do you feel like that you've saved in
that store?
Mr. Zimmerman. In Senator Bingaman's State we opened up a
store in Bernalio, New Mexico, about a year ago now. It's one
of our eight higher efficiency pilot stores. They represent
what our new prototype going forward we anticipate to be. It's
about 25 to 30 percent more efficient than the stores we would
have been building in 2005. Again, the stores in 2005 had heat
reclaim systems, energy management systems, daylight harvesting
systems. So that's a decrease on an already very efficient
base.
Out in more western climates such as Las Vegas, California,
where you have very arid climates, we're seeing even closer to
a 40 to 35 percent decrease in energy.
Senator Sessions. Do you have an opinion as to whether or
not the average retail store, whether a grocery store, a
clothing store, that's not focused on this issue, how much they
might reasonably save if they were to utilize practical cost-
saving energy efficiencies?
Mr. Zimmerman. Looking at the other retailers we've
acquired in other countries, like in Japan, where those
buildings have been designed and maintained under the umbrella
of the Kyoto Protocol, we use 50 percent less energy per square
foot in our U.S. stores today than we do in those Japanese
stores. I would venture to guess we would be able to save
similar savings in most of the U.S. retail environments. That's
why with the Department of Energy we formed the Retail Energy
Alliance, to share what we're doing with our competitors.
Senator Sessions. That's very significant. The 40 percent
of our energy, I think, Ms. Amann, that you said, that's the
total counting gasoline and everything else? Buildings utilize
40 percent? That's more than I--I've heard that figure, but I
guess I didn't believe it or it didn't register on me. But
that's quite a bit, so if you could reduce that by 40 percent
or 50 percent with cost-efficient technology.
Now, Mr. ''GUY-diss``?
Mr. Giudice. ''Jue-DEE-see,`` yes.
Senator Sessions. ''Jue-DEE-see.`` You mentioned solar.
Now, that makes me a little nervous. If you've got to get there
with solar, my impression is that today solar will not pay for
itself. Is that right?
Mr. Giudice. It depends on the kind of solar. There are
solar thermal technologies that can augment, especially in the
South, Southwest area, very cost-effectively other thermal
technologies. But you're right, solar PV today is not cost
competitive. The reason to invest in solar PV today is not
because it's a stable circumstance. We have seen PV pricing
come down significantly over the last decades and right now
it's actually coming down with the slackening of the market,
coming down very substantially over the last couple of months.
We've seen the alternatives--the cost of natural gas-fired
generation and so forth--over the last years go up.
The Department of Energy suggests that in the 5- to 10-year
timeframe and maybe less for some places that have particularly
expensive power, it will be cheaper to buy electricity from PV
on your roof than it is by buying it from the conventional
grid. That's not today and I wouldn't bet on that for all of
our investments, but I think it is appropriate to put some
resources toward those technologies and to help them come down
the cost curve and have it a viable option for us as we move
forward.
Senator Sessions. Those are all good ideas. When the
government rates appliances, air conditioning, heating systems,
and all of that, do you do them by brand name? Is there anyone
that--I guess you can't, or do we, explicitly recommend one
brand name, or is there any private groups out there that have
got the gumption to stand there: This is the best brand name to
buy for energy efficiency?
Professor Majumdar.
Mr. Majumdar. Yes. Again, I'm not an expert in this
particular topic, but from my understanding it is by the type
of the device and the actual energy used. So they have to meet
those standards. Again, these are measurements--these are
performance based on measured standards and that's how it is
done.
Senator Sessions. But historically the government hasn't
said, Brand X is better than Brand You?
Mr. Giudice. In Energy Star labeling they actually get
brand specific and model specific. I think it can move much
more dramatically forward. There are also independent bodies
that will rank and rate specific brands on their energy
consumption. But I do think the national government can take a
much more proactive role, and I think we have to look at a lot
of those performance standards also, which really aren't
testing the right things from an energy consumption standpoint.
How we're actually using air conditioning doesn't actually
relate directly to the SERE ratings that air conditioners, for
instance, are rated on.
So there's lots to be done in terms of appliance standards
and appliance testing.
Senator Sessions. Yes, briefly.
Ms. Amann. I would just agree that there's a lot to be done
in terms of improving our rating systems so they better match
what's happening in the field. Then as far as the programs that
are run by EPA and DOE on Energy Star and others, they set a
performance standard and any manufacturer that can meet that
qualifies. But you can get specific information, so you could
go in and find the best product from those lists.
Senator Sessions. Mr. Giudice, just briefly--my time is up.
I read something critical of Energy Star. Do you share those
criticisms?
Mr. Giudice. I think that it's easy to look in the rear
view mirror and say things could have been better, and I don't
think it has gone nearly far enough. But we have to understand.
Kind of, it has filled the void from a national leadership
standpoint and it has done it very well, and has moved a lot of
awareness. A lot of the mass market, a lot of consumers, look
at that Energy Star rating and it triggers something in them.
So not perfect, but nothing is. I think it has added a lot
of value, and I think there's tremendous opportunity to build
further on that.
The Chairman. Let me just ask one other follow-up to what
Senator Sessions was asking about. Do we have reliable, well
recognized ratings for manufactured housing, so that if I go on
a lot to buy a mobile home I can make a judgment there that
this is the most energy efficient mobile home or this one is
substantially below par?
Mr. Giudice. I don't think we do from my knowledge. It
would be very simple to----
The Chairman. I would think that would be the simplest
thing to accomplish, if you were looking at trying to rate
building construction or building efficiency.
Mr. Giudice. Agreed.
The Chairman. Let me ask if Senator Murkowski has any
additional questions.
Senator Murkowski. Just very quickly, Mr. Chairman. It
follows up on comments from Senator Sessions here as well.
You had mentioned, Mr. Hubbell, that Green Globes is a
voluntary certification standard. There's been a little bit of
a push or activity at the State and local levels to impose,
whether it's Green Globes or LEED or other standards. Should
Federal legislation specifically name or identify Green
Globes--kind of unfair to you, sir, because you represent
them--but lock us into that standard, if you will?
Mr. Hubbell. You know, Senator, I'm of the opinion that
it's not the rating system that matters; it's the performance
goal.
Senator Murkowski. Right.
Mr. Hubbell. So what I think is more appropriate and
productive for public policy would be to set performance goals,
and if rating systems can accelerate our progress to those. But
let's not let the plaque on the wall be the objective. Let's
let the energy performance and the carbon reductions be the
objective, and that's been our approach all along. So that
would be how I would answer it.
Senator Murkowski. Anyone else?
Mr. Giudice.
Mr. Giudice. One quick reaction is I do think that moving
the minimum standards much, much higher through building codes
is a necessary step. We can't just rely on the voluntary
efforts and just sort of publishing benchmarks. We actually
have to in my mind take the bad choices off the shelves,
because there are so many broken aspects of the energy picture.
Senator Murkowski. But would you do that through
performance standards or measurements?
Mr. Giudice. I would do building code-based performance
standards, so that we have to get to a much higher minimum
standard in our buildings, and then I would rank and rate the
buildings above that standard.
Senator Murkowski. Coming from the States' perspective, you
are OK with a national standard?
Mr. Giudice. I am. It's got to be regionally specific, but
I think this is a challenge and an opportunity and a need for
national leadership, that doing it on a State by State basis is
just going to take too long and it's going to be too much of a
hodge-podge of solutions.
Senator Murkowski. It's something that we in Alaska look at
very carefully, of course, because we're a little bit up there
in the cold and the dark, except we're in 2-hour sunlight----
Mr. Giudice. Six months a year.
Senator Murkowski. But it is something that I appreciate
the recognition that you've got to acknowledge the regional
differences that we all face.
Mr. Hubbell.
Mr. Hubbell. I just want to add to that. I think what
public policymakers can do is define the criteria for good
rating systems. I think it's important, for example, that
rating systems be developed through an open consensus process.
I think it's important that rating systems sufficiently address
energy and carbon reductions. I think rating systems ought to
rely on life cycle assessment and real building data.
So those are things that I think that the policymakers at
this level and all the way down can create as hurdles for those
of us in the rating system business, if you will, and let the
powers of competition do their thing. Knowing what your
criteria are, we're working real hard to make sure that our
rating system meets that.
Senator Murkowski. Thank you, Mr. Chairman.
The Chairman. Senator Sessions, did you have another
question?
Senator Sessions. No, thank you.
The Chairman. Let me thank the witnesses. This is very
useful testimony and we will conclude the hearing with that.
Thank you.
[Whereupon, at 3:57 p.m., the hearing was adjourned.]
APPENDIXES
----------
Appendix I
Responses to Additional Questions
----------
Responses of Jennifer Amann to Questions From Senator Murkowski
Question 1. What are some examples where the market has moved
energy efficiency in the right direction regardless of government
mandates?
Answer. The combined efforts of manufacturers, retailers,
contractors, utilities and other energy efficiency programs have moved
the market toward adoption of more efficient technologies. Particular
successes include compact fluorescent lamps, adjustable speed drives,
T8 fluorescent lamps, and several categories of Energy Star qualified
appliances and electronics.
Question 2. The federal and state governments have been engaged in
several standardized programs to promote energy efficiency in the last
few decades. It is also true that there have been advances in energy
efficient technology without the government playing a role. Please
describe the pros and cons of these two approaches.
Answer. While each approach has pros and cons, the most effective
strategy is to use government and market approaches to complement each
other. Government support of R&D often plays an important role in the
development of new energy efficiency technologies. Programs such as
Energy Star help build the market for high efficiency products and
leverage the efforts of utilities, manufacturers and retailers to
increase adoption of high efficiency products. Government mandates in
the form of codes and standards can capture the full energy savings
benefits of these advances once they are proven in the market and
ensure that all consumers reap the benefits of investments in energy
efficiency R&D and program activity.
Question 3. The recent stimulus bill directs billions to energy
efficiency measures. How can these funds be targeted to be most
effective?
Answer. These funds should be targeted toward the full array of
cost-effective efficiency opportunities in the residential, commercial,
and industrial sectors. Programs designed to reward actual performance
can maximize energy savings and cost-effectiveness. Good opportunities
can be found in comprehensive retrofits of existing buildings;
promotion of very high efficiency appliances, equipment and other
products; improvements in building codes including assistance to states
for training of code officials and inspectors; and training of building
contractors and service providers. Existing programs operated by state
and local agencies, utilities and other program implementers have the
infrastructure in place to get stimulus funding into the market
rapidly.
Question 4. Also, as you know, $3.1 billion of energy efficiency
block grants came with preconditions, namely energy efficiency
rulemaking measures and updating building codes. Are you concerned with
the inevitable delay in getting the energy efficiency funding out to
states and localities?
Answer. As passed, the energy efficiency block grants provided
through the ARRA require states to demonstrate that they are making
their best efforts to pass specific regulatory actions such as
decoupling and updated building codes, but do not require that these
new rules be formally enacted or in place. This should reduce the delay
in getting funds distributed to states and localities. DOE has recently
published guidance on how the process will work and I understand that a
considerable number of governors have already submitted certifications.
Question 5. In the 2007 Energy Independence and Security Act,
Congress authorized an initiative for the development and establishment
of zero net energy commercial buildings which applies to any commercial
building newly constructed in the United States by 2030 as well as 50%
of the of the commercial building stock of the United states by 2040.
Groups such as the American Institute of Architects (AIA) have endorsed
an immediate 50% reduction in fossil fuel-generated energy and a 10%
reduction target every five years until new and renovated buildings
achieve carbon neutrality in 2030.
Have we made any progress on these initiatives?
Answer. Through its Commercial Buildings Initiative, the Department
of Energy is working on industry partnerships, research, and tool
development--all important activities laying the groundwork for meeting
the stated goals for zero net energy commercial buildings. Details of
their efforts are available on the DOE website at www1.eere.energy.gov/
buildings/commercial_initiative/index.html.
Question 6a. Like some of our other panelists, your testimony
highlights a number of programs we endorsed during EPAct and EISA that
haven't obtained the necessary funding for implementation or only
recently received funding under the American Recovery and Reinvestment
Act (stimulus).
Do you believe that Congress should authorize new programs with
more stringent guidelines when many of our existing programs are not
yet up and running, or have been tested?
Answer. Many of the new programs we recommend target markets or
opportunities that have not received adequate attention in the past or
where unusually high barriers to energy efficiency exist. These
programs do not necessarily require more stringent guidelines so much
as they expand the depth and reach of our efficiency policies.
Authorization of these programs can lay the groundwork so they can be
rolled out when funds are available. In the case of the recent stimulus
bill, many good programs were not included for funding since there was
not prior authorizing language.
Question 6b. How can we best spend the money that has now been
allotted for these programs? What should our priorities be if an
opportunity for more funding comes along?
Answer. States and municipalities must be given the support and
assistance needed to enable them to run robust and effective programs.
One critical need is technical assistance and training for contractors
selling and installing energy efficiency measures and other market
actors influencing product selections and purchase decisions. EPA has a
lot of experience with this type of assistance through the Energy Star
program, but unfortunately EPA Energy Star was not funded under ARRA.
A key priority for any additional funding should be retrofits in
residential and commercial buildings including multifamily and
manufactured housing. Retrofits yield significant energy savings and
carbon reductions while creating jobs and saving consumers and
businesses money that can be redirected to other important needs.
Response of Jennifer Amann to Question From Senator Cantwell
Question 1. I understand standby power is a growing source of
energy consumption in buildings. While the typical power loss per
appliance is low--about one to 25 watts--when multiplied by the
billions of appliances in buildings across America, and the fact that
they occur basically 24 hours a day, standby losses are estimated to
account for about 10 percent of all household power consumption.
To try and address this problem, I inserted an amendment in the
2007 energy bill that required that any electronic device or appliance
purchased by the federal government use less than one watt of power
while in standby mode. I was pleased that the House subsequently
expanded this provision to incorporate standby power into all products
already subject to federal efficiency standards.
Are there other steps you believe we could be taking at the federal
level to reduce standby power loads?
Answer. In addition to the constructive efforts currently underway
to reduce standby power consumption, there are other actions with the
potential to yield greater energy savings. An increasing number of
appliances and electronic products are incorporating networking
capabilities allowing for communication with home and/or external
networks. Research is needed to better understand ``network modes'' as
one of the many low power modes comprising ``standby power,'' in terms
of power use and opportunities for managing and minimizing power
consumption in network modes. Standards recently finalized in the
European Union (eur-lex.europa.eu/LexUriServ/
LexUriServ.do?uri=OJ:L:2008:339:0045:01:EN:HTML) also provide a useful
model for further federal action on standby power. In particular, a
horizontal standard covering standby power for most energy-using
products could capture savings from a broader range of product types
and eliminate the need for developing standards on a product-by-product
basis.
______
Responses of Ward Hubbell to Questions From Senator Murkowski
Question 1. What are some examples where the market has moved
energy efficiency in the right direction regardless of government
mandates?
Answer. Systems like Green Globes, which bake in' energy metrics
and environmental programs like EPA's Energy Star program, are gaining
significant acceptance in the marketplace. Green Globes in particular
has embraced the already successful Energy Star program--which has
proven to help building owners arrive at performance that keeps them in
the top 25% of buildings nationwide. We drive our users to `design to
achieve' Energy Star while they are pursuing Green Globes-New
Construction certification. The market incentives that we create for
owners to seek Green Globes certification, in turn encourages them to
pursue Energy Star and other measures that reduce energy consumption.
Other incentives such as green insurance products and green
mortgages also prove that the market is driving the move towards
reduced energy consumption and environmentally-friendly buildings.
These products exist because there is market-driven demand and because
it makes business sense to encourage the development of buildings that
use less energy, reduce waste and have a high indoor air quality.
Question 2. The federal and state governments have been engaged in
several standardized programs to promote energy efficiency in the last
few decades. It is also true that there have been advances in energy
efficient technology without the government playing a role. Please
describe the pros and cons of these two approaches.
Answer. Governmental involvement (whether it's on the local, state
or federal level) has been successful in helping spur innovation and
adoption in all areas of energy efficiency, through incentive programs,
such as tax rebates, abatements, expedited permits, etc. Governmental
bodies have also played a large role in helping educate the general
public about the need for energy efficiency and the various benefits
(environmental, economic) associated with these practices. However,
this involvement can also lead to an unfair competitive market,
especially if the involvement of a local, state or federal government
favors one particular approach, or one particular organization.
Governmental involvement is essential to the growth and expansion of
energy efficiency practices and technology; however it must be done in
a way that is fair and allows for an open and competitive free market.
Another area of concern is that there has been a strong emphasis on
rewarding good design and construction practices without measured
(documented) energy savings being part of the package. Government can
help the marketplace by finding ways to reward a more holistic approach
to creating more efficient portfolios. Examples would be creating
innovative policy that de-emphasizes first cost budgeting in favor of
more holistic budgeting that accounts for long term maintenance and
operations costs and potential savings. Additionally, design, bid,
build strategies are not always the most effective for achieving
desired performance goals. Government should be asking how can we
change our own procurement policies to encourage integrated design,
delivery, and operations (e.g. a 10 to 30 year view of costs/savings
vs. 1-3 year view of immediate budget limitations).
Question 3. The recent stimulus bill directs billions to energy
efficiency measures. How can these funds be targeted to be most
effective?
Answer. The best way to meet our energy efficiency goals is to
ensure that the nation's existing building stock is performing
efficiently. The only way to do that is to measure, benchmark, and plan
for improvement. Government grants to non-profit associations with
standards and tools that can assist in making the benchmarking and
planning process easier so that it can be done by every building owner
in the country would create exponential benefits. These market
generated tools can then be used by government (without naming one tool
in particular) to gauge the before and after success of dollars
invested versus dollars/energy saved.
Additionally, there is a great need for education. Government
dollars focused on helping organizations deliver training to the masses
of building owners, operators, managers, and related workforce would be
dollars well spent.
Question 4. Also, as you know, $3.1 billion of energy efficiency
block grants came with preconditions, namely energy efficiency
rulemaking measures and updating building codes. Are you concerned with
the inevitable delay in getting the energy efficiency funding out to
states and localities?
Answer. While delays are a concern, a bigger problem will exist if
the necessary rulemaking and building code updates are hastily done
without proper vetting and input from the building community. These
preconditions can, and will, have a significant impact on the entire
building community, and considering the devastating business climate
they are currently facing, any new rules and code updates must be done
with full input from architects, engineers, designers, building owners
and other relevant organizations. We should also use this opportunity
to incentivize the use of a feedback loop to determine the actual
building performance that is achieved by these measure. Energy Star and
green rating systems that utilize Energy Star tools could be beneficial
to this effort.
Question 5. In the 2007 Energy Independence and Security Act,
Congress authorized an initiative for the development and establishment
of zero net energy commercial buildings which applies to any commercial
building newly constructed in the United States by 2030 as well as 50%
of the of the commercial building stock of the United states by 2040.
Groups such as the American Institute of Architects (AIA) have endorsed
an immediate 50% reduction in fossil fuel-generated energy and a 10%
reduction target every five years until new and renovated buildings
achieve carbon neutrality in 2030.
Have we made any progress on these initiatives?
Answer. While it's too early to know if these initiatives will
ultimately be successful, these programs have increased awareness about
the need to reduce energy consumption and focus on efficiency. However
there is still a lot of work that needs to be done. The next step for
these goals to be met is for the focus to shift to actual building
performance data, instead of just looking at design.
Question 6a. As I understand it, the concept behind systems like
Green Globes and the US Green Building Council's LEED standards was to
promote sustainability practices through voluntary leadership actions.
This seems to be an expanding market. Do you think we should be
specifically naming Green Globes, LEED, or any other program in federal
legislation?
Answer. It is essential that whatever language is ultimately
included in federal legislation be worded in a way that allows for
options. This means being inclusive of all nationally recognized and
credible existing rating tools while still allowing for the development
and use of rating tools that are not yet in existence. Listing any
rating tool by name in legislation will ultimately give that tool an
inherent advantage in the marketplace, limiting competition and
impeding innovation. Therefore, it is imperative that if one rating
tool is going to be named, all other nationally recognized rating tools
are also named.
The ideal option is legislation that rewards a specific performance
outcome and allows the architects, engineers, owners and tenants to
decide what, if any, rating tools will help them meet those goals.
However, this is not always practical; as the oversight required to
implement this type of performance based program can be extensive. That
is why green rating tools are helpful, as a certified green rating from
a credible organization (such as GBI or USGBC) is a sign that at least
a minimum amount of sustainability and efficiency measures have been
met.
If legislation does reference green rating tools, the best option
is to set forth criteria that an acceptable rating system must meet in
order to be recognized, and require that all rating tools meeting the
criteria be named in the subsequent rules. The legislation must be
carefully worded to ensure the process of judging and selecting
qualified rating tools is fair and free of preconceived bias.
Question 6b. Have any challenges arisen due to these state and
locally driven initiatives?
Answer. The major challenges arise when a given piece of
legislation only recognizes one rating tool. As discussed above, this
sole-sourcing isn't just bad public policy, but will also, in all
likelihood, hamper the development and adaptation of green building
practices. Every building and every project is different, and there is
no one-size-fits-all solution to green building. Architects, engineers,
owners and tenants need options, and whether it is an elementary school
or a skyscraper, being able to choose which rating tool works best for
a given project is vital to long-term growth and success of green
building.
Question 7. Please describe how your rating system works with
private sector incentives such as green insurance products and green
mortgages.
Answer. Insurance companies, such as Liberty Mutual, AON,
Travelers, and Fireman's Fund offer premium discounts and other
incentives to ensure that buildings are built, enhanced and restored to
achieve green certifications. The marrying of green rating system
certification and mortgages and insurance is a natural alignment
allowing for similar market based goals to be accomplished. For
instance, buildings that are Green Globes certified have achieved
compliance with requirements that are intended to reduce maintenance
and indoor environmental issues that are of great concern to insurance
providers.
Question 8. Once a building becomes certified, is there additional
follow-up with the building owner concerning the operation of the
building and its overall sustainability?
Answer. GBI is investing substantial time and resources to educate
its current users and the general public about applying life cycle
approaches to buildings. For instance, our training includes a
discussion of 5-8 year asset management strategies and how Green Globes
for New Construction and Green Globes for Continual Improvement of
Existing Buildings work together. GBI offers, in addition to our New
Construction tool, the Continual Improvement of Existing Building
(CIEB) tool to not only benchmark existing buildings but also to
provide assistance in the operations and maintenance activities
required to improve and maintain a green high performing building.
Recertification of existing buildings is currently required every three
years.
Question 9. Please describe the point system your rating system is
based upon. In order to achieve the 1,000 points, how did you rank the
areas of assessment?
Answer. The 1,000 points in Green Globes for New Construction
breakdown is as follows (and Green Globes-CIEB is ranked similarly):
Energy--360 points
Indoor Environment--200 points
Site--115 points
Water--100 points
Resources--100 points
Emissions, Effluents and Other Impacts--75 points
Project/Environmental Management--50 points
As detailed above, 36% of the total points allocated in Green
Globes is focused on Energy, the largest percentage of any rating tool
in the U.S. Green Globes also uses the Energy Star Target Finder
program for new construction and the Energy Star Portfolio Manager for
existing buildings.
Projects that achieve a score of 35% or more become eligible for a
Green Globes rating of one, two, three or four globes, as follows:
One Globe: 35-54%
Two Globes: 55-69%
Three Globes: 70-84%
Four Globes: 85-100%
Response of Ward Hubbell to Question From Senator Cantwell
I believe another promising area for improving the efficiency and
many other aspects of our nation's buildings is adding on green roofs.
On efficiency benefits in particular, according to the EPA, the surface
temperature of a green roof can be as much as 90 degrees Fahrenheit
cooler than the surface of a traditional rooftop.
Question 1a. Since your testimony did not specifically address
green roofs, could you talk about what potential roles do you see for
green roofs in achieving higher levels of building energy efficiency?
Question 1b. What is the energy savings potential of green roofs
and what federal incentives and programs might help to accelerate the
deployment of green roofs nationwide?
Answer. Vegetated roofs are believed to be effective in minimizing
heat island effect. Green Globes rewards the use of vegetated roofs
within our Energy section. We did not have sufficient time to gather
our technical experts to assess data that may be relevant to actual
measured savings from studies of green roofs. We would be happy to
follow up with staff following this submission.
Question 1c. Do you believe the Federal Energy Management Program
an effective vehicle for the acceleration of green roof deployment in
the federal building sector?
Answer. Our technical committee members have extensive experience
in vegetated roof systems as well as in FEMP vehicles. However, we were
not able to obtain sufficient input in time for inclusion in this
document. We would be happy to follow up with staff following this
submission.
______
Responses of Edward Mazria to Questions From Senator Murkowski
Question 1. What are some examples where the market has moved
energy efficiency in the right direction regardless of government
mandates?
Answer. Unfortunately, without government mandates, the market
moves the Building Sector towards increased energy efficiency slowly,
escalating development only when the country enters a recession and/or
the price of energy increases dramatically. This can be seen clearly in
the graph on Page #2 of my testimony. The drop in Building Sector
energy consumption is most apparent with the spike in oil prices that
began with the 1973 Arab oil embargo and continued through the short
recession that followed, and during the early 1980's recession when oil
reached the equivalent of $103.76 barrel (today's dollars) following
the 1979 Iranian Revolution.
After the crisis ended, lighting and energy management technologies
that were initiated during this period continued to develop, albeit
slowly, due in part to state initiatives and mandates. For example,
lighting technology continued to improve with the introduction of
higher efficiency lamps (T-8, T-5, and compact fluorescent bulbs) and
electronic ballasts. Several states (California, for example) adopted
stricter energy codes for commercial buildings that were partly
responsible for the development of markets for these more-efficient
lighting products. Over time, these advances in energy-efficient
technology were adopted more widely by the building sector. But
government programs were instrumental in promoting the early use of
these advances and creating markets so the costs for these products
could be reduced.
Question 2. The federal and state governments have been engaged in
several standardized programs to promote energy efficiency in the last
few decades. It is also true that there have been advances in energy
efficient technology without the government playing a role. Please
describe the pros and cons of these two approaches.
Answer. Relatively little has been accomplished in building sector
energy efficiency over the past few decades, so it is difficult to
single out the pros and cons of each approach. The two approaches seem
to only work well when they work in tandem. For example, when fossil
fuel prices increase dramatically, business and industry look to
innovate and deliver alternatives to the marketplace, while governments
deliver market incentives, new building codes, and fund R&D and
technology transfer through universities, research institutions and
national laboratories.
This was evident during the energy crisis of the 1970's and early
1980's. At that time, there were major advances in Building Sector
technologies--in glazing materials (heat mirror and low-e coatings),
passive and active solar energy systems design and applications,
passive and active cooling applications, natural ventilation systems,
phase-change materials, moveable insulation, building simulation
modeling programs, daylighting systems and controls, energy management
systems, night set-back thermostats and occupancy sensors, solar hot
water heating, solar thermal electric generation and storage,
photovoltaics and advances in low-energy lighting systems, to name just
a few. While some of these technologies continued to advance slowly
over the past twenty-four years, relatively little has happened in
developing innovative new energy efficiency and building energy
technologies and systems. The energy intensity of commercial buildings
has changed little over this period (total energy use per square foot
increased), while a decrease in the energy intensity of housing was
offset by an increase in housing size.
Government programs also play a critical role in advancing building
sector technologies due to the relationship between construction costs
and energy costs. For many commercial or leased building projects,
capital costs for construction and operating costs for energy use are
budgeted and paid for from different accounts. The project owner pays
for the building design and construction, while the tenants pay for the
resulting operating costs for energy and resource use. In this fiscal
environment, government programs (state energy codes and tax credits,
for example) have been very important in advancing the adoption and
promoting the improvement of cost-effective, energy-efficient
technologies.
The situation we find ourselves in today, with three major crises
converging at the same time--foreign energy dependence, climate change
and a deep economic recession--is very different from anything we have
ever experienced before. I believe both approaches to the Building
Sector, which is at the center of all three crises, must play a
critical role if we are to successfully meet these challenges.
Question 3. The recent stimulus bill directs billions to energy
efficiency measures. How can these funds be targeted to be most
effective?
Answer. I have carefully read through the American Recovery and
Reinvestment Act 2009, specifically to analyze the bill's requirements
on energy efficiency. I find that only in some cases are there
requirements, and that the few programs with requirements are somewhat
vague. There are no benchmarks or energy reduction targets (which are
essential to attaining real and significant reductions) mentioned in
the bill.
What this means is that many of the building projects put forward
in response to the bill will have minimal energy reduction strategies,
and as a result, minimal energy reductions.
The following language, if included in the energy bill, would help
to prioritize projects and serve as a guideline for projects submitted
for grants. While the language does not prohibit any projects from
going forward, it makes clear that projects will be competing for funds
and meeting specific energy reduction targets will be a priority
consideration in the judgment criteria.
This language also sets the benchmark based on i) CBECS and RECS
for federal and federally-owned buildings as called for in the Energy
Independence and Security Act 2007, and ii) ASHRAE and IECC for other
buildings. In addition, it also allows the Secretary of Energy to set
other benchmarks and reduction targets, since there are states that
have their own codes with specific criteria.
The following language would send a strong message to the building
community that significant energy reductions are important, and that
the federal government will lead the way:
A. That any new and renovated federal buildings receiving
stimulus money be required to meet the 2010 energy reduction
standard set by the Energy Independence and Security Act of
2007. Funding preference will be given to projects that achieve
overall energy savings compared to the Commercial Building
Energy Consumption Survey 2003 for commercial buildings and
Residential Energy Consumption Survey 2005 (RECS) for
residential buildings (or other comparable codes, standards or
measurement protocols authorized by the Secretary of Energy)
of, in the following order of priority--(1) carbon neutral, (2)
85 percent, (3) 70 percent, (4) 55 percent.
B. For any new building construction or renovation project
grants made with stimulus money by state and local governments,
preference shall be given to projects that achieve overall
energy savings compared to ASHRAE 90.1-2004 for commercial
buildings and IECC 2006 for residential buildings (or other
comparable codes, standards or measurement protocols authorized
by the Secretary of Energy) of, in the following order of
priority--(1) 75 percent to carbon neutral, (2) 50 percent, (3)
30 percent.
Question 4. Also, as you know, $3.1 billion of energy efficiency
block grants came with preconditions, namely energy efficiency
rulemaking measures and updating building codes. Are you concerned with
the inevitable delay in getting the energy efficiency funding out to
states and localities?
Answer. The answer to this question is multifaceted and requires
some explanation.
Since professional architects and engineers design most commercial
and public buildings and large-scale housing developments, it is
instructive to look at A/E firm billings to project future Building
Sector construction activity. It takes 6 months to a year or two to
design and prepare construction documents for a building project, a few
months for bidding, a month or two for contract negotiations and
another month or two for construction start up. Billings for housing
began to decline sharply at the end of 2007, followed by a decline in
commercial and industrial project billings in early 2008. It was not
until August of 2008 that we began to see a decline in public building
project billings. At the end of 2008, while construction in housing and
commercial buildings were in steep decline, construction in the public
sector was steady with school construction up 6% and government
building construction up 6% (Page 14 of my testimony).
Most of the stimulus money and energy efficiency block grants for
buildings are slated for the public building sector. Projects that have
been designed but shelved for lack of tax dollars will be pulled off
the shelf as shovel ready. Other projects will begin the design process
taking advantage of efficiency block grant monies. As a result, the
public building sector should continue on without a construction
downturn for another few years.
While I do not foresee a delay in using the efficiency block grant
money, the anticipated building energy consumption reductions will fall
short unless the actions recommended in answer #3 above are
implemented.
Question 5. In the 2007 Energy Independence and Security Act,
Congress authorized an initiative for the development and establishment
of zero net energy commercial buildings which applies to any commercial
building newly constructed in the United States by 2030 as well as 50%
of the of the commercial building stock of the United states by 2040.
Groups such as the American Institute of Architects (AIA) have endorsed
an immediate 50% reduction in fossil fuel-generated energy and a 10%
reduction target every five years until new and renovated buildings
achieve carbon neutrality in 2030.
Have we made any progress on these initiatives?
Answer. Yes, interest in the 2030 Challenge energy reduction
targets has increased significantly since we issued the 2030 Challenge
in January of 2006. Many state and local governments, professional
organizations, A/E firms and institutions have adopted the targets and
have begun to implement them, and many more would like to do so.
However, without clear and sustained leadership and support from the
federal government, these efforts will not be enough. Specifically, we
will not see any significant reductions in the rate of increase in
building sector energy consumption, let alone a decline, until the
National Model Building Energy Code Standards are updated as indicated
on Pages 12 and 13 of my testimony.
My emphasis on performance standards is deliberate. By setting
performance rather than prescriptive standards, Congress will not be
picking energy and efficiency technology winners and losers. The
marketplace, individual practitioners and building owners will
determine the most cost-effective strategies that meet the performance
standards. Many new strategies and technologies will emerge (and
existing ones will re-emerge) to meet the particular conditions of
various climatic regions and economic conditions. Performance standards
bring out the best in our competitive and entrepreneurial spirit and
create a level playing field for all technologies.
For this approach to be most effective, performance standards and
`reach codes' must preempt federal minimum appliance standards to
insure the emergence of new technologies, systems and design practices.
Also, I would ask that the Committee be mindful of the dates for
the Model Energy Code updates specified on Page 12 of my testimony. The
dates correspond with the 2007 Energy Independence and Security Act's
initiative for the development and establishment of zero net energy
commercial buildings in the United States by 2030 as well as 50% of the
commercial building stock of the United States by 2040. They also
coincide with the code standard update cycles set by IECC and ASHRAE.
For example, the 2016 date for the 50% standard is critical and is set
to coincide with the 2018 IECC code release date of April 2017. The
next IECC code cycle is not until 2024. The dates specified on Page
12--2016, 2022, and 2028, giving the states two years to adopt the code
standards--meets both the 2030 Congressional target date and code cycle
upgrade timelines.
Question 6. As part of your vision to stimulate the economy, you
provide a plan that would adjust interest rates on homes, pursuant to
their energy reduction capability, and an accelerated depreciation
schedule for commercial buildings, who demonstrate energy savings.
Please describe who would manage these mortgage and depreciation
programs.
Answer. The Plan would leverage the benefits of energy reductions
by offering for both existing and new homes, through Fannie Mae and
Freddie Mac, mortgage financing with reduced interest rates in
proportion to the energy reduction target reached. The Treasury
Department is currently doubling its financial support to Fannie Mae
and Freddie Mac. It will buy as much as $200 billion of preferred stock
in the two mortgage companies, twice as much as previously promised.
This support provides the capital to implement the Plan and tie the
Treasury's support of Fannie and Freddie to private investment and job
creation.
The new `conforming' mortgages would be no larger then that allowed
by law. The interest rate buy-down schedule would be determined by
available funds and the level of job creation desired. For existing
homes, a minimum amount of private investment in efficiency would be
required according to the energy reduction target and mortgage rate
offered. Homeowners taking advantage of the Plan would be required to
have an energy audit and a certification that the work was performed
properly. Equity can be built into the Plan by allowing existing
efficiency and solar tax credits to be used up to a maximum mortgage
amount or home value. Tying the mortgage rate buy down to minimum
energy reduction targets insures that every federal dollar spent will
stimulate private investment and create jobs.
Since my testimony, the US Treasury and the Federal Reserve are
expected to offer refinancing through the Term Asset-backed Loan
Facility (TALF) next month to help free up money for the commercial
real estate sector. Given this new development, the way to create jobs
through commercial building energy reductions is through existing
federal, state and local programs. At the federal level we recommend
increasing The Energy Efficient Commercial Buildings Deduction from
$1.80 per square foot for the 50% energy consumption reduction (cost
savings) to 1) $3.50 per square foot for meeting a minimum 50% energy
consumption reduction target below ASHRAE 90.1-2004, 2) $5.00 per
square foot for meeting a minimum 75% energy consumption reduction
target, and 3) $6.50 per square foot for a building that is carbon
neutral.
Building energy consumption from non-depletable energy sources
collected on site or provided from within a development would be
considered an energy reduction. The tax deduction should be offered for
a period of 3 years.
Question 7. I understand that there have been several green
mortgage products developed to assist homeowners interested in these
types of improvements. How different would your program be from these
types of products?
Answer. Interest in `green' homes has increased dramatically in the
past few years. There are rebates, tax breaks and cash incentives for
green homes offered by states and local governments. Fannie Mae
provides a `green mortgage' program where the added value of a home's
energy efficiency translates into more buying power not necessarily a
lower net monthly outlay. The program is for both new construction and
existing properties.
The problem is very few people are applying for these incentives
and mortgages. Right now, the public is averse to purchasing big-ticket
items and increasing their monthly outlay, regardless of how small.
Our Plan is very different. By tying the mortgage interest-rate
buy-down proposed in our Plan to specific energy reduction targets and
homeowner investments, three highly beneficial and desired results are
achieved: 1) new demand for Building Sector jobs is immediately
generated, benefiting not only the Building Sector, but all the
industries and sectors that support the Building Sector, 2) a
homeowner's monthly mortgage payments and energy bills are
significantly reduced, providing disposable income and making it much
more likely that they can meet their payments, and 3) creation of a new
$236 billion per year renovation market that does not currently exist.
A mortgage buy-down that is not tied to aggressive energy reduction
targets and private investment will not create many jobs or new
business opportunities.
Question 8. Is it reasonable to demand Net Zero Energy performance
from existing buildings, regardless of size, and geographic location?
What obstacles exist in practice, to obtain net zero energy?
Answer. In the 2007 Energy Independence and Security Act, Congress
authorized an initiative for the establishment of 50% of the commercial
building stock of the United States to be zero net energy by 2040. In
the Act, the definition of a `zero-net-energy commercial building' is:
a commercial building that is designed, constructed, and
operated to--(A) require a greatly reduced quantity of energy
to operate; (B) meet the balance of energy needs from sources
of energy that do not produce greenhouse gases (GHG); (C)
therefore result in no net emissions of greenhouse gases; and
(D) be economically viable.
Given this definition, I believe it is possible to achieve zero-
net-energy for 50% of the commercial building stock of the United
States by 2040 for the following reasons; i) over the next 30 years
three quarters of the built environment in the US will be either new or
renovated; ii) low-rise commercial buildings, which are easier renovate
to zero-net-energy, make up 77% of total US commercial building stock;
iii) most existing buildings can reduce their energy consumption using
economically viable and readily available, strategies, technologies and
equipment; and iv) the definition allows for existing buildings that
cannot produce as much clean (non-GHG emitting) energy on-site as they
consume, to purchase clean energy from a local or central utility.
Response of Edward Mazria to Question From Senator Cantwell
I believe another promising area for improving the efficiency and
many other aspects of our nation's buildings is adding on green roofs.
On efficiency benefits in particular, according to the EPA, the surface
temperature of a green roof can be as much as 90 degrees Fahrenheit
cooler than the surface of a traditional rooftop.
Question 1a. Since your testimony did not specifically address
green roofs, could you talk about what potential roles do you see for
green roofs in achieving higher levels of building energy efficiency?
Answer. Green roofs and cool roofs (solar reflective roofing
membrane or surface) are part of a new generation of roofing strategies
that have a high potential to reduce energy consumption in buildings.
Each has advantages and disadvantages that are well documented in
government literature. It must be noted however, that green roofs
provide benefits beyond energy savings, such as storm-water management,
filtering and reducing the temperature of water runoff, cooling ambient
air temperatures (heat island effect), and increasing green space (see:
Reducing Urban Heat Islands: Compendium of Strategies, EPA 2008).
Question 1b. What is the energy savings potential of green roofs
and what federal incentives and programs might help to accelerate the
deployment of green roofs nationwide?
Answer. The energy savings potential of green roofs depends on
local climatic conditions and individual building and roof
characteristics, such as size, use and insulation values. Greater
energy savings are weighted toward a reduction in summer heat gain
through shading, thermal mass and evapotranspiration, rather than in
winter heat loss. Of critical importance in low-rise green-roofed
buildings is their thermal resiliency, or their ability to maintain
acceptable interior conditions when exterior conditions reach extremes
(heat waves and cold spells), especially during a blackout or brownout.
The Cities of Portland, OR and Chicago, IL have been very
successful with their green roofing efforts by offering density bonus
incentives in their zoning codes. This type of policy promoted
nationally may accelerate green roof deployment. Federal tax credits to
building owners are another avenue. We believe however, that updating
the National Model Building Energy Code Standards (Page 12 of my
testimony) will lead to the greatest deployment of all building energy
savings strategies and technologies.
Question 1c. Do you believe the Federal Energy Management Program
an effective vehicle for the acceleration of green roof deployment in
the federal building sector?
Answer. Yes, the Federal Energy Management Program is charged with
assisting federal agencies to use energy, water, and other resources
wisely; green roofing is an effective design option that accomplishes
these goals.
evaluation of study titled ``achieving 30% and 50% over ashrae 90.1-
2004 in a low-rise office building'', prepared for naiop (commercial
real estate development association), published december 2008
After a thorough review of the NAIOP-commissioned energy efficiency
study, it is my professional opinion that the study is of no value and
is intentionally misleading for the following reasons:
1. The study analyzes a square-shaped, four-story office
building configuration with completely sealed windows and an
equal amount of un-shaded glass on all four sides of the
building. In other words, the study analyzes an extremely
inefficient and outdated building design typology.
2. The study looks at only three cities and climates--Newport
Beach, Chicago and Baltimore--and does so without changing the
design of the building to respond to these very different
climates.
3. Of the numerous energy saving measures that can be applied
to, or integrated into a building design, the study analyzes
only five measures.
4. The study intentionally does not analyze any of the
readily available (and well known) low-cost, no-cost and cost-
saving measures that reduce a building's energy consumption.
For instance, the study does not investigate changing the shape
of the building, its orientation or form; redistributing
windows or using different windows to take advantage of natural
light for daylighting or sunlight for heating (office buildings
are day-use facilities); shading the glass in summertime to
reduce the need for air-conditioning; using operable windows
for ventilation (not even in Newport Beach with its beautiful
year-round climate); or using low-e glazing. It also does not
investigate employing a heat recovery system, cost-effective
solar hot water heating system or energy management control
system. In fact, the study fails to analyze so many of the no-
cost and inexpensive energy-saving options available, that it
is impossible for the building configuration studied to reach
commonly achievable energy-consumption-reduction targets.
5. NAIOP contends that its analysis is ``aimed at
understanding the practical and economical impacts'' of energy
efficiency measures available. Yet, the study intentionally
analyzes high-cost, low-energy-reduction measures to falsely
demonstrate that increases in efficiency are expensive and
unachievable. For example, the roof area in a four-story
building is only 25% of the building floor area. Increasing the
insulation values in the roof well beyond code will yield only
marginal efficiency results and at steep costs. However, seven
roof insulation options are analyzed in this category (see
Graph 1. below).*
---------------------------------------------------------------------------
* Graph has been retained in committee files.
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6. Upgrading to commonplace low-e double glazing is 6.5 times
more efficient at half the cost per square foot than upgrading
to R-38 roof insulation, yet the study does not consider this
option.
7. The study is statistically irrelevant. A four-story office
building represents less than one percent (approx. 0.29%) of
commercial building square footage and 0.08% of all building
square footage in the US.** A four-story, square office
building with equally distributed sealed glazing on all four
sides is a small fraction of this 0.08%.
---------------------------------------------------------------------------
** Source: US Energy Information Administration, 2007 Building
Energy Data Book, Tables 2.2.3 and 7.4.2, and the EIA AEO 2008, Tables
4 and 5.
---------------------------------------------------------------------------
______
Responses of Philip Giudice to Questions From Senator Murkowski
Question 1. What are some examples where the market has moved
energy efficiency in the right direction regardless of government
mandates?
Answer. Over the past three decades there are relatively few
instances in which the market alone has moved toward energy efficiency
without some local, state, or national mandates or other government
involvement. Interest by producers and consumers in energy efficiency
has tended to rise and fall with the price of gasoline and other fuels.
It would be great for markets and the private sector to move us toward
a much more energy efficient world without government intervention but
it is not doing so at present.
For a host of reasons, minimizing the first cost of a purchase is
weighted dramatically higher in priorities than minimizing life cycle
costs, by both consumers and producers. This tendency contributes to a
classic tragedy of the commons situation whereby each individual
perceives themself as being better off by minimizing their first cost
of a purchase, even though as a society we are all worse off by
consuming far more energy than we need for the comfort, convenience and
work we need to accomplish. The fact that individuals would also
actually be better off from a life cycle cost standpoint provides an
even greater impetus for government intervention. Much more energy
efficiency will allow consumers and society to consume far less energy
and producers will produce more valuable products. A relatively small
amount of government intervention can and does provide dramatic
benefits for all.
EnergyStar labeling is a powerful example of public-private
partnership, where the combination of branding and development of
consensus standards has raised the bar for energy efficiency across
many types of appliances and equipment. Products from computers to
windows to power supplies are more efficient than previously. Equally
important, the EnergyStar brand is widely recognized, respected and
accepted as a standard of energy efficiency. Unfortunately, the
consensus standards set in EnergyStar are often only modest
improvements over what existed before, and so the acceptance of
EnergyStar in the public mind as the efficiency standard may actually
inhibit more ambitious energy efficiency. The public does not recognize
that further highly cost-effective product improvements are possible
and available, and thus does not buy those higher-performing products.
Domestic appliance efficiencies showed little gain until federal
standards mandated improvements. A ``golden carrot'' competition to
produce a highly efficient refrigerator in the 1990's demonstrated that
such products could be manufactured, but the industry responded by
producing a few very high-end models that didn't find a significant
market. Nonetheless, with federal standards now in place through
legislation, the average refrigerator now consumes half the electricity
required by a typical 1990 refrigerator.
Periodically updated and constantly improving appliance standards
based on the performance of a top tier of the most efficient appliances
available could provide exactly the private--public process to
stimulate continuous innovation and much greater energy efficiencies.
This ever-escalating performance standards approach is being utilized
in Japan and is helping to stimulate innovation and much more efficient
appliances.
Energy Services Companies (ESCOs) operate in the private sector but
tend to specialize in niches, such as institutional buildings. ESCO's
utilizing privately financed shared-savings approaches have effectively
improved clients' energy efficiency. However without support from
ratepayer-funded utility programs or public funds, ESCOs are not able
to provide as deep energy savings as possible and miss many
opportunities that could result in improved savings lasting decades
rather than several years. Unsupported ESCO work tends only to capture
the lowest hanging fruit and not the fullest potential of savings.
One notable example of a market moving towards higher energy
efficiency with a small amount of government support is data centers.
EPA and DOE's green computing initiatives have helped bring a spotlight
on data centers' needs and options. Also, California's state-run energy
efficiency programs, which have specific tailored programs for data
centers administered by the investor owned utilities, have been very
helpful. These government programs have sparked much greater interest
and awareness of energy efficiency in data centers and much better
practices are emerging.
In the past, data centers added processing power and servers
without regard to their energy consumption. Increasingly data centers
are recognizing that their single largest cost is the cost of energy
for their operations--more than the cost of hardware, software,
telecommunications, personnel and buildings. With this recognition,
innovation has been unleashed and new solutions have emerged. Software
is helping to realize a three fold or more increase in storage capacity
from the same servers. Servers and processors have been redesigned to
consume much less electricity and produce much less heat. Cooling
requirements are being focused on exactly the components that need
cooling and not the empty space between. All in all great strides are
being made at the best data centers to produce the same amount of
useful output while consuming much less energy.
Question 2. The federal and state governments have been engaged in
several standardized programs to promote energy efficiency in the last
few decades. It is also true that there have been advances in energy
efficient technology without the government playing a role. Please
describe the pros and cons of these two approaches.
Answer. The most effective energy efficiency efforts are those in
which both the private and public sectors play strong interactive
roles. Energy efficiency has `public good' benefits in addition to the
private benefits to the end-user, therefore, economic theory suggests
that appropriately targeted government regulation is likely to improve
the market outcome. As a result, there are relatively few circumstances
in which the market has found solutions completely on its own, leading
to more energy efficiency without at least some governmental
participation.
The underlying reason for this is the relatively low cost of most
forms of energy, even in high-cost regions like New England. The low
cost of energy until very recently has been coupled with the further
perception that energy costs only amounted to a very small percentage
of operations costs in all but the most energy-intensive industries.
Without the drivers of high costs and the negative impacts high energy
costs have on competitiveness, there has been little motivation across
most sectors of the economy to pursue energy efficiency for its own
sake. Higher energy prices and increasing concern about climate change
are just now having a serious effect on attitudes toward energy use at
home and at work.
Over the past 30 years the first impetus for increased energy
efficiency came from low income households. Low income families,
including the working poor, have had virtually no income growth during
this period, but these families typically occupy the leakiest homes and
must use the least efficient heating and cooling equipment. DOE's Low
Income Weatherization Assistance Program was for many years virtually
the only national energy efficiency and conservation program. In
Massachusetts our low income program regularly delivers 20% to 30%
energy savings for each family served and provides a national model for
programs in other states. That program is also a model for the deeper
savings that we are now beginning to implement in ratepayer-supported
energy efficiency programs.
Government, non governmental organizations, and the private sector
all have roles in energy efficiency. The EnergyStar consensus standards
process shows the impact that cooperative action can bring. But
EnergyStar is not the leading edge of energy efficiency--the consensus
process slows upgrading of EnergyStar standards primarily because
private sector partners impede adoption of better standards. Homes can
be built that are far more energy-efficient than the EnergyStar New
Homes standard, with only small increases in first cost, costs that are
offset in just a few years by superior performance.
Government has a role in setting strong, responsive standards where
the private sector has failed to do so. Government solutions are needed
in the form of strong building codes that are enforced on the ground,
strong appliance standards for highly efficient heating and air
conditioning, strong standards that eliminate electricity waste from
''instant on'' electronic appliances and other ``vampire'' electricity
consumption.
Government mandates have produced results and should continue to be
used, but there needs to be room for regional variation based on
differences in climate, and for experimentation. In most cases where
the federal government has set efficiency standards it has pre-empted
state standards. This leaves the unfortunate situation in which high-
cost states like Massachusetts are not allowed to have stronger
standards than the out-of-date federal standards allow. The most
egregious example concerns gas-fired furnaces. A federal standard,
which will become effective only in 2015, raises the minimum furnace
efficiency from 78% to 80%; while most furnaces purchased for private
homes in Massachusetts are currently at 90%. Yet tenants, who are often
in the lower income brackets, must continue to pay for the operation of
inefficient furnaces because we cannot mandate landlords to provide
better efficiencies.
Question 3. The recent stimulus bill directs billions to energy
efficiency measures. How can these funds be targeted to be most
effective?
Answer. Collaborative strong working relationships between the
states and the federal government can and will provide a basis for
assuring that the stimulus funds are put to work quickly,
transparently, productively and get the results we all need. State
energy offices and the well-established weatherization agencies and
service providers have long-standing established relationships with
their federal counterparts to do exactly what is needed. There are no
single silver bullet answers to the question of how to best achieve
energy efficiency, and the right solution in one state is not
necessarily the right solution in another state due to varied climate,
industry makeup, age of building stock, etc.
Question 4a. Also, as you know, $3.1 billion of energy efficiency
block grants came with preconditions, namely energy efficiency
rulemaking measures and updating building codes. Are you concerned with
the inevitable delay in getting the energy efficiency funding out to
states and localities?
Answer. We are not concerned about these requirements for
Massachusetts or any state. Massachusetts has fulfilled the
requirements fully. Further, as specified in the ARRA bill, the
requirements are not onerous for any state to commit to working towards
regulations that support increased energy efficiency and better
building codes.
Question 4b. In the 2007 Energy Independence and Security Act,
Congress authorized an initiative for the development and establishment
of zero net energy commercial buildings which applies to any commercial
building newly constructed in the United States by 2030 as well as 50%
of the of the commercial building stock of the United states by 2040.
Groups such as the American Institute of Architects (AIA) have endorsed
an immediate 50% reduction in fossil fuel-generated energy and a 10%
reduction target every five years until new and renovated buildings
achieve carbon neutrality in 2030. Have we made any progress on these
initiatives?
Answer. California and Massachusetts have active policy development
to push forward zero net energy buildings (similar to carbon
neutrality) for both the commercial and residential sectors. During the
past year Massachusetts convened a Zero Net Energy Buildings Task
Force, which issued its report on March 11. The report can be found at
this link: http://tiny.cc/aJRwi
The Task Force and report were built around a goal set by Governor
Patrick to achieve universal adoption of zero net energy buildings for
new construction by 2030. We have defined this goal as:
A zero net energy building is one that is optimally efficient
and, over the course of a year, generates energy onsite, using
clean renewable resources, in a quantity equal to or greater
than he total amount of energy consumed onsite.
Among the key commercial-sector recommendations are that energy
performance standards be set for all new buildings and major
renovations, differentiated by building type, by January 1, 2012. These
standards would then be updated in future years, and specifically tied
to ``exemplars,'' meaning the highest-performing new buildings in the
Commonwealth, by January 1, 2018. Performance standards would be
established for existing buildings by January 1, 2014. Also important
is a recommendations that all commercial buildings display ``energy
certificates'' that make visible their energy use in comparison to
recognized standards, by January 1, 2012.
A key early step in this direction is improving the efficiency
requirements in the state's building code. A 2007 law requires that the
Commonwealth adopt the latest version of the International Energy
Conservation Code (IECC) within one year of its publication. We have
now proposed to go beyond the IECC by adopting a ``stretch code'' that
would be available for municipalities to adopt at their option. The
Stretch Code is now being considered by our Board of Building
Regulation and Standards (BBRS). It would require that most commercial
buildings above 5,000 square feet (excluding several types of
``specialty'' buildings) use 20 percent less energy per square foot
than would occur under the ASHRAE 90.1 2007 standard, which is widely
used in the United States as the basis for state commercial building
codes. Modeling conducted by the two largest electric utilities in
Massachusetts has shown, for several particular buildings, that the 20
percent reduction can be achieved with lifetime savings on energy bills
that are far larger than the incremental addition to initial capital
costs. For example, in one case of a mid-sized office building that has
been completed, modeling estimated a three-year payback on the capital
costs, which was reduced to one year after the incentives provided by
the utility, National Grid.
Question 5. You highlight a number of energy efficiency programs
that Massachusetts has successfully undertaken. Which ones, in your
opinion, have been the most effective? Why?
Answer. We are now meeting approximately 8% of our electricity
needs through efficiency rather than greater electricity supply. In
fact, we are effectively saving electricity at about 3.5 cents per kWh,
compared to approximately 9 cents for the cost of conventional supply.
A primary means through which this has been accomplished is effectively
spending substantial funds on well designed, measured and verified
efficiency. These funds have been collected through the systems benefit
charge (SBC) on electric bills at a rate of \1/4\ of a penny for ever
kWh distributed by investor owned utilities in MA. As of 2006, out of
the nine states with the highest rankings for their electric efficiency
programs, Massachusetts had the highest level of total spending, at
$125 million, which constituted 1.5% of total electric revenues.\1\ For
natural gas programs spending was lower (but this will change under the
least-cost spending law passed in 2008), at $25.6 million in 2006, yet
this still ranked us fourth in the nation, as measured by efficiency
spending per unit of gas consumption.\2\ For the 2003-2005 time period,
estimated lifetime benefits from all the utility programs is estimated
at $1,229 million, compared to $504 million in spending by the
utilities and program participants (businesses and residents), for an
average benefit to cost ratio of 2.84.\3\
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\1\ ``The 2008 State Energy Efficiency Scorecard,'' ACEEE, October
2008, Table 4, page 7.
\2\ ACEEE, Table 8, page 11.
\3\ ``Massachusetts Saving Electricity: A Summary of the
Performance of Electric Efficiency Programs Funded by Ratepayers
Between 2003 and 2005 , Executive Office of Energy and Environmental
Affairs Massachusetts Division of Energy Resources,'' April 2, 2007,
page 2.
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These levels of spending enable Massachusetts utilities to provide
appropriate incentive levels to businesses, homeowners, and owners of
rental property for the completion of efficiency measures. Because of
the serious marketplace barriers to energy efficiency that are largely
inherent in the economy (average ownership of a building by one company
or household only lasting a few years; lack of information; lack of
certainty over the gains from efficiency; shortages of capital funding;
``split incentives'' when the owner of the facilities is different from
the party paying the energy bills; energy prices that do not reflect
full societal costs of energy use), such incentives are vital to
convince building occupants to engage in efficiency.
The keys to having successful energy efficiency programs are
straightforward in concept but not necessarily in execution. Successful
programs require all of the following:
Identify an efficiency need not being successfully addressed
in the marketplace;
Identify a cost-effective strategy to meet the need,
including appropriate marketing, incentive type and delivery,
presentation to the target market, and implementation
strategies;
Test models in pilots, adjust, implement at full scale;
Evaluate and adjust, substantially revise or end, as
appropriate.
Educate and train an appropriate work force
Enlist people in their homes and businesses to take active
roles.
Rigorous measurement and verification of results
In Massachusetts, utility-based incentives have, on average, paid
for about 60 percent of the capital cost of installing energy-efficient
equipment. Among the various programs, efficient lighting provided 54
percent of the total energy savings for commercial, industrial, and
residential sectors combined, with HVAC (heating, ventilation, and air
conditioning) providing another 23 percent.\4\
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\4\ Massachusetts Saving Electricity. . .'', page 7.
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Among the programs that have led to increased consumer purchases of
high-efficiency light bulbs, light fixtures, and appliances are
``negotiated cooperative promotions.'' Rather than require consumers to
fill in and mail back a rebate form in order to obtain an incentive,
which yields lower participation levels, cooperative promotions
subsidize retailers to directly reduce their prices on these products.
These promotions have been a major aid in raising sales of items such
as compact fluorescent bulbs (CFLs), torchiere lamps that take CFL
bulbs, and EnergyStar rated appliances. In 2006, these programs
provided incentives for the purchase of 4 million CFLs discounted to
$1-$2/bulb. Equally, or more important, an additional 5 million CFLs
were purchased through other channels in the state, as years of CFL
incentives have yielded their widespread acceptance among consumers.
Also important has been the availability of energy audits at a
major discount to businesses and free to homeowners. Since the possible
gains from efficiency are largely unknown to the public, particularly
for their own individual buildings, the hurdle of paying several
hundred to several thousand dollars for an initial evaluation of their
potential savings is a major obstacle. Providing these evaluations at
low or zero cost gives building owners the information they need to
consider making efficiency investments, without first having to make a
substantial cash outlay before they have an idea of the potential
benefits. However, we also know from long experience that audits alone
do not generate energy efficiency. Homeowners, renters and businesses
also need technical, process and financial assistance to undertake
energy efficiency improvements.
For low-income residential households efficiency services are
provided at zero cost, since such households lack the capital to pay
for even a small fraction of installation costs. We estimate that for
the 2003-2005 time period, lifetime utility bill savings for these
households were $140 million, with a large fraction of the savings
coming from reduced winter heating bills, in contrast to other
customers, who obtained most of their savings on electricity.
Installations focus on air sealing and insulating buildings, and where
necessary replacing heating systems.
Question 6. As we know, it does no good to mandate a code if the
standards are not adequately enforced. Do you have any challenges with
ensuring code compliance? If so, what are they?
Answer. Code compliance is enforced by municipal building
inspectors in Massachusetts and almost all other states. There is
clearly a challenge here, due to shortages of staffing that make it
difficult for the inspectors to adequately check on all projects, the
fact that inspectors see their primary mission as insuring the safety
of buildings, and also due to inadequate training programs for the
inspectors on efficiency requirements and on the need to enforce the
energy code. With increased funding that is becoming available from
several sources, including the federal stimulus bill and the Regional
Greenhouse Gas Initiative auction proceeds, the Commonwealth plans to
provide greater assistance to cities and towns on both these fronts.
Under the Green Communities Act passed in 2008, we are required to
provide assistance for training of the inspectors.
In the case of our `stretch' code proposal to go beyond the
existing building code, we are moving the burden of energy code
enforcement for residential homes away from the overburdened municipal
building inspectors by requiring a 3rd party certified rating and
inspection from a certified rater. These raters are already used by a
host of voluntary programs including the Energy Star Homes program, the
DOE home rating initiative, the LEED for homes program and the recently
announced National Association of Home Builders Green Homes program.
Third party inspection may well prove to be the most desirable path for
ensuring that homes are built to at least the minimum performance
standards embodied in the existing energy efficiency codes and the more
aggressive codes to come. Still, it will be a challenge to develop and
deploy a corps of home energy raters in a time of slow new
construction.
Question 7. You mention that several European countries, including
the UK, Germany and Austria have implemented standardized building
energy calculations that are made available to the public, and that
ASHRAE has just announced that it will develop such a scale. Has there
been any feedback on the success, or any challenges that may have
arisen, due to this measure in Europe?
Answer. There is broad agreement that effective action on building
codes is necessary but by itself is insufficient without a
complementary approach to rating building performance. Building energy
ratings allow the real estate market to factor in the energy efficiency
of a building in the purchase price or lease or rental costs of a
building. The UK, Germany and Austria have been leading adopters of
this approach, but it has been developed in response to a standardized
European policy called the EU Energy Performance of Buildings
Directive. The original European Building Energy Directive of 2002 is
summarized here: http://www.diag.org.uk/media/18835/cibse_briefing.pdf.
However, the EU is in the process of finalizing an expansion of
this directive given its success. A press release on the revisions to
the EU directive is available here: http://tiny.cc/6wQIT
The UK policy to fulfill the EU buildings directive is available
here: http://www.diag.org.uk/
Question 8. Your testimony provides a number of examples where
states are moving forward with their own energy efficiency programs.
Are states taking the lead in this area? If so, please describe whether
or not a `one-size fits all'' approach may impact different
jurisdictions.
Answer. Some states are taking a lead with energy efficiency
programs. For the most part the most active leaders are the same as
those from the last 20+ years: Massachusetts, California, the Pacific
Northwest, Wisconsin, Minnesota, Vermont, Connecticut, and New York.
These states have developed critical mass in their infrastructures, and
have maintained and extended their energy efficiency efforts over time.
They have also been laboratories for each other and for states that are
just beginning to ramp up their efforts. There has been a great deal of
cross pollination among the most active players, including state
governments, utilities, NGO's and other professional energy efficiency
organizations. Emerging states include Maryland, Illinois, New Jersey
and others.
Different strategies are appropriate for different states and
regions, due mainly to variations in climate conditions. These have
been expressed in state government requirements and incentive programs,
and also in the regional specificity of both model building codes
published by ASHRAE and the IECC, and in Energy Star standards. Such
differences are appropriate and should continue, but there also many
areas where climate is not relevant to a standard, and in these
situations uniform national standards are appropriate.
The federal role, expressed by DOE and EPA, has been most effective
in nurturing existing efforts and extending the knowledge base in
almost all aspects of energy efficiency. National Laboratories--
Lawrence Berkeley, Oak Ridge, National Renewable Energy Laboratory and
the Pacific Northwest National Laboratory--have made many contributions
through technical studies, evaluations, and direct assistance to state
and utility programs. The National Labs have been a baseline resource
and should be supported and further encouraged in their efforts.
Question 9. Please describe how the weatherization program has
worked from your state's perspective. There remain differences in
weatherization standards from area to area. Do you support further
modifications to harmonize standards of the weatherization program to
ensure that providers are maximizing the efficiency gains made in these
building projects?
Answer. The Low Income Weatherization Assistance Program is the
oldest national energy conservation and efficiency program in the
country. It's precursors date to 1975; the program as we know it today
was first funded through the Federal Energy Administration, now the
Department of Energy, in the late 1970''s. Since that time the program
has evolved greatly from minimal `low-cost no-cost efforts that used
part-time trainees, to the current programs that use the evolved
knowledge of building science, experienced contractors and local
program administrators to provide systematic approaches that provide
substantial real savings to low income homeowners and renters. The
Massachusetts program typically achieves savings in the 20-25% range
for all fuels. In Massachusetts and other states, the DOE funds
leverage additional funds from utility energy efficiency programs, so
that the average expenditure per home from all sources is now in excess
of $3,000. The program emphasizes treating the house as a system . The
program provides additional non-energy benefits, such as healthier
environments.
Housing types, climate, and living arrangements vary across the
country. The specific solutions needed to address Boston and New York
apartment dwellers are different from those in single family housing in
Virginia or New Mexico. Certainly some variation is appropriate to
accommodate specific conditions. What should not vary is a national
approach that addresses all fuels, heating and cooling needs as
appropriate, and most importantly takes a systemic approach to
addressing energy needs. What should also not vary are bold goals for
reaching the low income population's energy needs broadly and deeply,
energy efficiency solutions based in proven science and techniques,
strong training and quality control, and finally, strong educational
efforts to enlist low income households in energy efficient behaviors.
Response of Philip Giudice to Question From Senator Cantwell
Question 1. I understand standby power is a growing source of
energy consumption in buildings. While the typical power loss per
appliance is low--about one to 25 watts--when multiplied by the
billions of appliances in buildings across America, and the fact that
they occur basically 24 hours a day, standby losses are estimated to
account for about 10 percent of all household power consumption.
To try and address this problem, I inserted an amendment in the
2007 energy bill that required that any electronic device or appliance
purchased by the federal government use less than one watt of power
while in standby mode. I was pleased that the House subsequently
expanded this provision to incorporate standby power into all products
already subject to federal efficiency standards.
Are there other steps you believe we could be taking at the federal
level to reduce standby power loads?
Answer. The issue of standby power losses is an important one given
the growing percentage of energy use in buildings now taken by `plug
load,' of which standby losses are a significant portion.
One way to tackle this issue is to ensure that standby power
requirements are in place for all DOE appliance standards in addition
to peak usage requirements. Some of the existing DOE appliance
standards have not been updated since the 1990s and may presume that
appliances are switched off completely when not in use, rather than
continuing to require electricity. The energy star appliances program
has required these standards for many years, but might benefit from a
review of its potential to do more on phantom loads on small appliances
such as cellphone chargers.
In addition there needs to be significant consumer education to
raise awareness of the issue of standby power as simple and non
intrusive behavioral changes can do a lot to mitigate this energy use.
The use of power bricks to combine electric plugs on one device with an
on-off switch (and optionally a timer switch) is one simple and low
cost mitigation strategy that requires primarily end user education to
implement.
One effective way to do this education and outreach is through the
implementation of building energy rating standards and home energy
audits as these typically break out the primary uses of energy and
would illustrate the significant role of plug load from appliances in
the overall building energy load. Utility and public information
programs are another potentially effective means of educating the
public, as well as businesses. Standby losses in computers, copiers and
all sorts of office equipment represent significant but often
unrecognized business costs. Networked computers, which still represent
the bulk of business personal computers are generally shipped with
power management features turned off because network administrators
continue to specify that as the default setting.
______
Responses of Arun Majumdar to Questions From Senator Murkowski
Question 1. What are some examples where the market has moved
energy efficiency in the right direction regardless of government
mandates?
Answer. Heat pumps were developed in the 1950s without government
mandates, in part motivated by reducing operating costs of electric
heating. Joint private and public R&D contributed to efficient
technologies, for example refrigerator compressors (NRC, 2001) and
condensing gas-fired furnaces (DOE and industry, ca. 1981). It is
useful to note that industry first attempted condensing gas-fired
furnaces in 1928, but the units suffered excessive corrosion and early
failure. Subsequent private efforts similarly failed until a joint DOE-
private program beginning in 1979 identified materials that solved the
corrosion problem\1\. Prior to the existence of government programs,
such as development of test procedures and labels, little information
existed in the market about energy efficiency. Voluntary government
programs, e.g., Energy Star, have helped move the market toward higher
energy efficiency. Market adoption of these technologies was assisted
by state-mandated utility incentive programs, as well as by mandatory
regulations such as state building codes and federal energy efficiency
standards. The existence of a persistent government program for
updating energy efficiency regulations has likely shifted the amount of
private R&D toward energy efficiency from other issues.
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\1\ James R. Brodrick, Alex Moore, ``Conquering carrion'', ASHRAE
Journal, April 2000, pp.29-33
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Note that manufacturers frequently introduce energy-saving features
when they add new functionality or features to a product. However, in
my view, there are relatively few cases where manufacturers have
modified a device solely to raise its energy efficiency in the absence
of government programs. Furthermore, manufacturers sometimes convert
the efficiency gains into higher performance, such as greater
acceleration in cars, larger refrigerators, or brighter lights, rather
than only giving consumers greater energy savings.
In general, market forces push higher energy efficiency when
efficiency is a side benefit of some other technological improvements.
The development of switch-mode power supplies about 1998 resulted in
large increases in the efficiency of small power supplies for consumer
electronics (first cell phones, then laptop computers). The initial
impetus for this technology was their reduced weight and waste heat.
They also permitted huge reductions in standby power use.
Another example is the change from CRT to LCD computer monitors.
The main feastures of LCD monitors are light weight, efficient use of
desk space and improved resolution. That changeover is almost complete,
and the LCDs use \1/2\ to \1/3\ the power of CRTs for screens of the
same size. LCDs are typically advertised as ``flat screen'' rather then
``energy efficient'' ones.
For the case of efficient electronic ballasts for fluorescent
lamps, government programs (e.g., state minimum efficiency standards)
appear to be solely responsible for the uptake of the efficient
technology\2\.
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\2\ Koomey, Jonathan, Alan H. Sanstad, and Leslie J. Shown. 1996.
``Energy-Efficient Lighting: Market Data, Market Imperfections, and
Policy Success.''. Contemporary Economic Policy. vol. XIV, no. 3. July
(Also LBL-37702.REV). pp. 98-111. )
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Question 2. The federal and state governments have been engaged in
several standardized programs to promote energy efficiency in the last
few decades. It is also true that there have been advances in energy
efficient technology without the government playing a role. Please
describe the pros and cons of these two approaches.
Answer. These two approaches (government programs and market
advances) are complementary, not conflicting. Competitive markets lead
to innovation. Large corporations seek to maximize profits and can
invest capital in a variety of opportunities world-wide. However, there
are market failures as well. For example, in commercial buildings,
builders or landlords select the energy-related equipment while
consumers pay the energy bills, leading to misalignment in incentives
to reduce capital cost versus energy efficiency. Market failures limit
the private profits available from commercializing energy-efficient
technologies that are attractive from a societal benefit-cost
perspective.
Government programs can align private profits from efficient
technologies with societal benefits (lower operating costs, lower
emissions of pollutants and greenhouse gases and associated health and
productivity benefits). Those government programs--such as labels,
government procurement, tax credits to manufacturers and consumers,
utility incentives--help create or expand markets for efficient
technologies, whether those technologies are originally researched and
developed with private or public funds. As an example of the
convergence of private and public interests, appliance manufacturers
sometimes negotiate simultaneously three government programs that
support energy efficiency: i) updates to energy efficiency standards,
ii) Energy Star levels and iii) tax credits to manufacturers and to
consumers.
On the research front, a recent study of R&D100 awards found that,
in contrast to 30 years ago when about 80% of winners were large firms
acting on their own, today roughly two-thirds of the winners involved
collaborations across companies and increasingly with the public
sector. Factors that likely contributed to this include the increasing
complexity of technology and the corresponding challenges of any single
company to bring sufficient technical expertise to bear, and the value
of the public sector in catalyzing research and bringing disparate
parties around a common problem. Further work is needed to evaluate
this issue, but it may be indicative of the larger challenges facing
the R&D enterprise\3\.
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\3\ Fred Block, Matthew R. Keller, ``Where Do Innovations come
From? Transformations in the U.S. National Innovation System, 1970-
2006'', The Information Technology and Innovation Foundation, 2008
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Question 3. The recent stimulus bill directs billions to energy
efficiency measures. How can these funds be targeted to be most
effective?
Answer. The economic stimulus package offers a unique opportunity
to make energy efficiency investments in a way that not only creates
jobs in the short term, but also addresses long-term goals of energy
efficiency.
Consider the long-term first. The Commercial Buildings Initiative
(CBI), as legislated by EISA'07, requires the US to approach zero-net
commercial buildings by 2030 (within the next 20 years). As I have
identified in my written and oral testimonies, there are two major gaps
today:
Lack of measurement of building actual energy performance
and policies requiring it
Lack of integration in design and operation of buildings
The stimulus funds could play a very critical role in overcoming
some of these barriers. As an example, consider Figure 1 which shows a
flow chart and feedback loops of how long-term goals could be achieved,
and identifies in the gray box where and how the stimulus funds could
play a critical role.* In collaboration with states, counties, and
cities, here are some early steps that the stimulus funds could help
achieve:
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* Figures 1-4 have been retained in committee files.
1. Create and deploy an integrated information technology
(IT) infrastructure (hardware, communications, and software) to
obtain sub-metered energy performance of all public buildings.
2. Create generic non-proprietary energy-related operations
and maintenance dashboard visualization architectures and apply
them to every public, so that facilities managers can begin
reducing their energy use immediately.
3. Create a national repository to collect and store
standardized energy performance data of every public building.
4. Develop efficient and accurate modeling and simulation
tools through calibration to data so the models can be used to
rapidly identify retrofit measures that can have the maximum
energy savings at minimum cost.
5. Deploy those retrofit measures.
If these key steps outlined here are enabled by the stimulus
package, they could pave the way in the long-term for:
(i) buildings that continually optimize their own
performance;
(ii) whole building integration for both design and
operation;
(iii) real-time continuous commissioning, prognostics and
diagnostics;
(iv) validation of reductions in energy consumption;
(v) lessons learned and best practices of what energy
efficiency measures provide the maximum benefit, which can be
used for new building design and operation;
(vi) national commercial whole-building energy labels (like
mpg) of both `asset' (modeled potential) and `operational'
(actual measured performance) types.
Here are some early steps that have been taken locally:
a) Given our location in the Bay Area, there have been
preliminary discussions between LBL to partner with local
cities (Richmond, Berkeley, Emeryville, Oakland) to introduce
the IT infrastructure to measure the performance of all public
buildings in these cities.
b) LBL has also helped General Services Administration (GSA)
come up a plan of how to introduce an infrastructure of
measurement and feedback control to create ``smart'' GSA
buildings.
c) UC Berkeley campus is also considering introducing the IT
infrastructure in the campus buildings.
While I am aware of only the above-mentioned steps in our locality,
I suspect such steps are being taken in other localities as well. I
believe the national laboratories in partnership with the federal and
state agencies could play a role as regional centers to provide the
necessary guidance and stewardship for using stimulus funds to achieve
long-term energy efficiency goals.
Question 4. Also, as you know, $3.1 billion of energy efficiency
block grants came with preconditions, namely energy efficiency
rulemaking measures and updating building codes. Are you concerned with
the inevitable delay in getting the energy efficiency funding out to
states and localities?
Answer. I believe it would be most appropriate for DOE-EERE to
respond to this question. Having said that, in my view, the benefits
from these block grants will be substantial. For the purpose of
stimulus, minimizing delay is best since job retention and creation are
urgently necessary. However, if we are to connect the dual goals of
short-term job creation to long-term energy efficiency, it would be
useful and prudent to create a plan (see response to Question #3),
which could provide guidance to states and localities for ongoing
implementation of cost-effective efficiency measures after the stimulus
is over. As I mentioned before, the national laboratories in
partnership with the federal and state agencies could play a role as
regional centers to provide the necessary guidance and stewardship.
Question 5. In the 2007 Energy Independence and Security Act,
Congress authorized an initiative for the development and establishment
of zero net energy commercial buildings which applies to any commercial
building newly constructed in the United States by 2030 as well as 50%
of the of the commercial building stock of the United states by 2040.
Groups such as the American Institute of Architects (AIA) have endorsed
an immediate 50% reduction in fossil fuel-generated energy and a 10%
reduction target every five years until new and renovated buildings
achieve carbon neutrality in 2030. Have we made any progress on these
initiatives?
Answer. I believe it would be most appropriate for DOE-EERE to
respond to the question of how much progress has been made on the
above-mentioned initiatives. Having said that, I will provide some
details of what measures have been taken so far.
In response to EISA'07, DOE launched the Commercial Buildings
Initiative as part of the EERE Buildings Technology (EERE-BT) Program.
In August 2008, DOE created the National Laboratory Collaborative on
Buildings Technology, which consists of a team of 12 people (2 from
each of the 5 national laboratories and 2 from EERE-BT program) to
better support DOE's CBI activities. That group has now begun to become
engaged in a new round of planning the RDD&D agenda, and has recently
been asked by EERE to create a roadmap for CBI. EERE-BT program has
updated its multiyear plan that begins to address the issues raised in
EISA'07 with respect to CBI. EISA also requires DOE to designate a
consortium to assist DOE in the management and implementation of the
program. A Federal Register notice was released to address this and
responses are now being evaluated by EERE-BT.
The Architecture 2030 ZEB goals that have been adopted by the AIA
and many cities and other organizations are generally consistent with
the DOE EISA ZEB goals. While EISA sets only the long term performance
target, Architecture 2030 sets a specific timetable that starts
immediately with a mandate that all new buildings use 50% less energy
than current building stock. While these goals are achievable in
principal, with motivated owners and skilled design teams, they are not
easily met today for a variety of reasons related to technology,
finance and design process so that in fact only a very small number of
buildings achieve the Architecture 2030's initial 50% target. We also
lack a comprehensive data collection and reporting program that would
make it practical and efficient to track progress toward these long
term goals.
Question 6. There are several rating programs available to use in
obtaining differing ``green'' building ratings. Within your testimony
you reference a study by Frankel concerning one such program and raise
the issue of whether there is a means to improve the correlation
between design intent and actual performance in individual buildings
rated by these programs. Are there ways to accurately predict overall
performance of these `green' rated buildings?
Answer. Green building ratings address many performance factors,
and overall the ``green building rating'' movement has been a positive
force to focus additional attention on the importance of energy
efficiency in our building stock. Different green building rating
systems assign different levels of priority to achieving energy
efficiency. So there are many claims for green buildings in which
energy efficiency has not been a major driver in the design of the
building, which is one reason why one sees a wide range of energy
performance even from buildings with the same green building rating.
But even if we focus solely on energy, as I noted in my testimony,
there has been a historical disconnect between ``design intent'' and
actual measured performance. There are some fundamental
``understandable'' reasons why measured performance may not meet design
expectations. Consider for example a case where designs are formulated
around a building with one 8-hour shift, with a low density of staff,
and little office equipment, and energy predictions are made
accordingly. Now consider the situation some time later when
construction is complete and the building owner now uses two 8 hour
shifts, more people per shift, and adds extensive amounts of new energy
consuming equipment, e.g. servers. In this case we would expect the
measured performance to be much larger than predicted. This could
potentially be addressed if the simulation is modified to incorporate
such changes and additions to buildings energy use.
While significant progress has been made in our current simulation
tools, such as Energy Plus, over ones that were developed in the 1980s
(e.g. DOE-2), more can be done, especially to make them useful for
operations as well. The designers and their consultants may not be
adequately trained in the use of the tools or may not have adequate
understanding of the new efficiency technologies to be employed.
Inappropriate materials and equipment substitutions may have been made
compared to original designs, thus compromising performance. New and
complex controls and operating systems may not have been adequately
commissioned to ensure their proper operation. Occupants of the
building may not fully understand how control systems work, thus
reducing performance and increasing energy use. Operators often do not
have the real time energy metering, monitoring, visualization and
interpretation tools that would allow them to reliably operate the
facility to achieve energy performance targets. In order to bring
measured performance into alignment with design intent and
expectations, each of these issues must be properly addressed.
In the future, if information regarding occupancy, lighting, HVAC,
appliance use, and other energy consuming activities are integrated
with advanced simulation tools, it is highly likely that we will reduce
the mismatch between design intent and actual performance.
Question 7. Please describe the most effective steps to move
towards reductions in risk and cost in existing technologies that could
enable a deeper market penetration to meet zero-net energy goals.
Answer. Your question properly identifies a key focus on the role
of innovation to enable these new ZEB designs. We not only need
entirely new, disruptive scientific breakthroughs that dramatically
increase performance but we need innovation that addresses cost and
risk as perceived by designers and owners as well. I have identified
these in my written testimony as well.
The specifics will vary with different technologies and building
systems but let me illustrate with some examples. Daylighting
strategies are good examples of the ``integrated systems'' I described.
They can reduce electric lighting use by 50-80%, and they are
reportedly used in many of the high performance buildings today.
However the dimming ballasts that help capture the lighting savings are
far too expensive to be routinely used or specified. We have been
advised by manufacturers that if the technology moved from small niche
markets to much larger mainstream markets, then new investment in
cheaper more effective integrated chip technology and volume production
could reduce current costs by 80%. So we would propose a national
program of cost-shared demonstration projects with states, utilities,
etc to create these high volume mainstream markets to provide deeper
market penetration at much lower cost. These systems also involve
integration of sensors and controls, and proper calibration and
maintenance over time. Today these functions are complex, costly,
risky--and therefore not widely used. We believe that an aggressive
RDD&D effort-that links sensor improvements in the lab with field
demonstrations of measured performance with state and utility
partnerships, would rapidly move these systems into mainstream markets
and could greatly accelerate progress toward these goals. We are
confident that these systems will work as we have already partnered
with owners, state agencies and suppliers to produce such an integrated
daylighting/shading system in the New York Times building in Manhattan.
We would invite you to visit this building to see first hand the
potentials for these systems. The challenge is now that noted in your
question: moving from single examples to widespread application and
use.
Many building owners and developers do not believe that an
integrated system will actually reduce energy consumption in a
building. However, we know from practice that even partial integration
(lighting only or HVAC only) can lead to such reductions, and if a
building is fully operated like a system, reductions can be much more.
We need testbed facilities around the country that are reconfigurable,
and which demonstrate that a fully integrated building can dramatically
reduce energy consumption, much more than is achievable today through
simple retrofitting and retrocommissioning. Such regional facilities
would make deep reductions in energy consumption credible to building
owners, and it would enable to them make financial decisions based on
actual data. This would reduce risk and enable a deeper market
penetration.
Question 8. Please describe how you would develop a science-based
approach towards Whole Building Systems.
Answer. A building is made up of materials, HVAC, lighting,
windows, appliances etc. These components and sub-systems are supplied
by different companies, which don't generally interact with each other.
Yet, when these components are assembled in a building, they do indeed
interact with each other, and sometimes fight each other and waste
energy. We need a science-based approach to develop deeper
understanding of how these components interact with each other. Based
on that fundamental understanding, we need to develop tools to design
and operate buildings. The design should integrate physical sciences
and engineering (see below) with architecture and information science
and technology. An example of such a tool is what we are calling the
``Building Operating System'', which is the ``intelligence'' or the
brain behind building operation. It will take in sensor data from
lighting, HVAC, plug loads, and occupancy, and then make decisions of
how the achieve the right comfort and indoor environment and yet
exploit cooperation between sub-systems to reduce overall energy
consumption of the system. While feedback control system do exist for
HVAC or lighting individually, a Building Operating System for all the
energy systems in a building does not exist today.
The Building Operating System must be based on fundamental
understanding of how fluid and heat flows in the building, the dynamics
of building systems and how to use feedback control to stabilize the
system. Figure 3 shows the time and length scales involved. It is
necessary to use the basic science of thermodynamics, fluid mechanics,
heat transfer and feedback control systems as the underlying
``foundational science'' in the next generation simulation and
operational tools.
Question 9. Please describe how you would develop an educational
system to promote the type of workers needed to design whole buildings
systems, and other buildings that may lead to the goal of zero-net
energy buildings.
Answer. The major gap in the buildings industry is the
fragmentation of the process of designing, constructing and operating
buildings. This is depicted in Fig. 4, which illustrates how fragmented
operational islands are created. Lack of communication and integration
occurs because there are no common goals and incentives. Unless this is
addressed, it is unlikely that we can achieve zero-net energy buildings
in a cost effective and scalable way.
This can be addressed through integrated education programs at
multiple levels. Professional architects and engineers need improved
educational curricula so that every architect graduating from an
accredited program has the skills to design a zero energy building. At
the university levels, we must create joint curricula that integrate
science, engineering, architecture, business, public policy and law to
collectively address the needs of the buildings industry. Such
integrated programs can provide a holistic view of all aspects of how
can one reduce energy consumption in buildings. However, they do not
exist today, but can be created with existing know-how. I note the
superb efforts of a small group of educators, the Society of Building
Science Educators, who have struggled to upgrade the quality and
quantity of classes and training experiences that architects must
master in their educational programs. Similar efforts are needed to
educate a new generation of electrical and mechanical engineers. More
generally, the challenge is to integrate the concepts of energy
efficiency into the graduate curricula, such as architecture,
engineering, business, and agriculture.
An equal or larger challenge is continuing education programs to
improve the skill levels of existing professionals, and perhaps methods
to help finance those who may be interested in returning to classrooms
to sharpen or extend their energy design skills. We need to create
education/training bootcamps and certificate programs that provide an
integrated view of the buildings industry. Both professional training
and continuing education programs must not only expand the knowledge
base in terms of materials, products and systems, but must train
designers to think and act in a more collaborative and integrated
manner to address the systems integration issue I described in my
presentation. The AIA and other professional groups are exploring how
this ``integrated design process'' can be most effectively implemented
to equip our designers with the process skills needed to produce a new
generation of zero energy buildings.
In my testimony, I have recommended the creation of Regional
Centers of Excellence that can integrate R&D with professional training
and continuing education program through the use of test-bed facilities
for hands-on experience. For example, if we are to achieve zero-net
energy buildings through the judicious integration of IT
infrastructure, advanced simulation tools and a Building Operating
System, the next generation of architects, building designers and
operators must be exposed to the integrated tools and approaches.
Finally, as I mentioned in my testimony, we need to initiate a
significant program of graduate student and post-doctoral fellowships
as well as young investigator awards that will attract the best young
minds to energy science and technology, and help create intellectual
capital for the nation. For many years the DOE funded a fellowship
program in Nuclear Engineering to create and maintain the academic
infrastructure to support nuclear energy. Now it is time to create a
large, graduate fellowship program to support students pursuing Ph.D.s
in energy efficiency. Such a program could be quickly established and
have a long-term impact on energy efficiency technologies. My Division
at Lawrence Berkeley National Laboratory and my University, UC
Berkeley, would be pleased to host some of these Ph.D. students.
Question 10. Is it possible for a new building to reach the goal of
zero-net energy, be cost effective, and be easily scaled up to a wide
market introduction?
Answer. Your question gets to the heart of the challenge today. It
is possible for a new building to approach the zero net energy goal on
a one-off basis today IF an enlightened owner with a large budget
selects a skilled integrated design team, and if the construction,
commissioning and operations are also intelligently and skillfully
executed. Even then the building type, size and climate will influence
the outcome. As an example--it is much easier today to achieve ZEB
levels of performance in a small office building in a coastal
California climate, than to achieve that level in a highrise building
in Houston that houses a data center and restaurant. Since your
question addresses scaling to wide markets in a cost-effective manner,
I would then have to say that this goal cannot be achieved today. It
could be made cost-effective if all the benefits--not just energy
savings, but productivity, livability/quality of experience, health,
long-term costs of emissions, live cycle assessment--are included.
Scaling up to wide market introduction will require significant effort,
but may be more desirable than the consequences of inaction, including
long-term costs of later retrofit, environmental consequences, etc.
Scaling up will decrease the costs of achieving zero-net energy. We are
confident that with policy changes (e.g. standards based on measured
performance), and appropriate investment in new breakthrough
technologies and systems, and with better trained designers with new
design methods and better tools, these goals are attainable on the time
scale envisioned by EISA'07.
While the focus of the responses so far has been zero-net energy
buildings for new construction, it is important to remember that we
should achieve 50% saving in existing buildings as well. This can be
more difficult than new construction, and should be a significant focus
of any program.
Response of Arun Majumdar to Question From Senator Cantwell
Question 1. I understand standby power is a growing source of
energy consumption in buildings. While the typical power loss per
appliance is low--about one to 25 watts--when multiplied by the
billions of appliances in buildings across America, and the fact that
they occur basically 24 hours a day, standby losses are estimated to
account for about 10 percent of all household power consumption.
To try and address this problem, I inserted an amendment in the
2007 energy bill that required that any electronic device or appliance
purchased by the federal government use less than one watt of power
while in standby mode. I was pleased that the House subsequently
expanded this provision to incorporate standby power into all products
already subject to federal efficiency standards.
Lawrence Berkeley National Laboratory has been a world leader in
identifying and explaining the standby power problem. Can you describe
the standby power problem in the United States and the prospects for
reducing this growing demand source?
How would you assess the how well federal agencies are complying
with the standby power provisions in the 2007 Energy Bill? What have
been the resulting benefits to taxpayers from reduced federal energy
use?
Answer. My colleagues at Berkeley Lab estimate that standby power--
that is, the electricity use of appliances while switched off or not
performing their primary functions--is responsible for roughly 8% of
residential electricity use and 1% of global carbon emissions. In
California, for example, the average home has about forty appliances
continuously drawing electricity.
EISA'07 requires DOE to take into account standby when establishing
new energy efficiency regulations for new appliances and in government
purchasing. The DOE can better comment on what I believe is its
considerable progress towards implementation; however, I would like to
reflect on three aspects that deserve further consideration.
1) First, the definition of the standby mode set out in
EISA'07 is potentially restrictive and difficult for DOE to
convert into effective regulations. I would recommend
authorizing additional research to create a clear definition.
2) Second, EISA'07 treats standby power in the context of
each appliance. In some cases it is simpler, from both
technical and administrative perspectives, to think of standby
as a ``horizontal'' issue affecting many types of products. I
would recommend authorizing DOE to regulate certain kinds of
functionality across many energy-using products rather than on
a product-by-product basis. This approach will also be valuable
when dealing with time of use pricing and with ``smart''
appliances communicating with the proposed ``smart'' grid.
3) Third, EISA'07 focused on standby power use in products
already covered by energy efficiency standards. This is
understandable: however, recent research by my colleagues
suggests that standby power use is growing most rapidly among
the hundreds of smaller products. The energy use of each of
these products is small, but the combined impact is
significant. I would recommend consideration of a
``horizontal'' approach to reduce the electricity use of these
smaller devices.
With regard to Federal procurement of low standby products, I would
like to note that this activity originated with a presidential
Executive Order (13221) in 2001. Berkeley Lab has been active advising
the Federal Energy Management Program (FEMP) in its implementation
since then. For example, we advise FEMP about the appropriate standby
level for each product. Products complying with the Executive Order
(and now EISA) are listed on a website presently managed by Berkeley
Lab (oahu.lbl.gov). No evaluation of EISA's impact has taken place but
anecdotal evidence suggests that federal purchasing specifications with
respect to standby power have strongly influenced the way manufacturers
design equipment for both the government and public.
With regards to prospects to reduce standby power, I believe that
considerable savings are still possible although the problem has become
much more complex in the last decade. Increasingly, appliances and
consumer electronics need to stay continuously linked to a
communications network and perform other functions even when they are
not truly ``on''. As a result, many new low-power modes are appearing,
all consuming significant power. An important research task will be to
ensure that consumers gain the functionality that they desire in future
devices but in the most energy-efficient way possible.
______
Responses of Charles Zimmerman to Questions From Senator Murkowski
Question 1. What are some examples where the market has moved
energy efficiency in the right direction regardless of government
mandates?
Answer. Because energy is Wal-Mart's second largest operating
expense, we've been focused on efficiency practically since the day we
were founded. Over the years we've taken a number of innovative steps
to become more efficient, most or all of which were adopted without a
government mandate. Because lighting accounts for one third of our
energy consumption, it provides a good example of energy efficiency
measures we've taken. We've developed a daylight harvesting system that
is utilized in more than 95% of newly constructed Wal-Mart Supercenters
and Sam's Clubs. By integrating dimmable T-8 fluorescent lamps,
electronic continuous dimming ballasts, computer-controlled daylight
sensors, and approximately one skylight for every 1000 square feet, we
take full advantage of natural daylight. Daylight harvesting can reduce
up to 75% of the electric lighting energy used in a Supercenter during
daylight hours. Each daylight harvesting system saves an average of
800,000 kWh per year, which is enough energy to power 73 single family
homes (11,020 kWh average annual usage) for an entire year.
Question 2. The federal and state governments have been engaged in
several standardized programs to promote energy efficiency in the last
few decades. It is also true that there have been advances in energy
efficient technology without the government playing a role. Please
describe the pros and cons of these two approaches.
Answer. We believe that governments at the state and/or federal
level and the private sector each have a role to play in achieving
greater efficiency. Federal and state incentives and mandates have
played an important part in achieving efficiency gains over the last
few decades, while the private sector has driven the innovative
products and practices that have helped to meet, or--in our case--
exceed federal and state requirements.
Question 3. The recent stimulus bill directs billions to energy
efficiency measures. How can these funds be targeted to be most
effective?
Answer. We believe that state and local governments are uniquely
positioned to distribute stimulus funding based on their specific needs
and the criteria established in the American Recovery and Reinvestment
Act of 2009.
Question 4. Also, as you know, $3.1 billion of energy efficiency
block grants came with preconditions, namely energy efficiency
rulemaking measures and updating building codes. Are you concerned with
the inevitable delay in getting the energy efficiency funding out to
states and localities?
Answer. Given that the stimulus bill became law a few short weeks
ago, we believe it is too soon to judge whether or not the conditions
placed on additional state energy grants will result in funding delays.
Question 5. In the 2007 Energy Independence and Security Act,
Congress authorized an initiative for the development and establishment
of zero net energy commercial buildings which applies to any commercial
building newly constructed in the United States by 2030 as well as 50%
of the of the commercial building stock of the United states by 2040.
Groups such as the American Institute of Architects (AIA) have endorsed
an immediate 50% reduction in fossil fuel-generated energy and a 10%
reduction target every five years until new and renovated buildings
achieve carbon neutrality in 2030.
Have we made any progress on these initiatives?
Answer. We have been in discussions with DOE and the National Labs
regarding the potential of this program and Wal-Mart's involvement. The
details of the specific program and what we will do, if anything, has
not yet been determined. We'll be sure to update you as we make
progress.
Question 6. Please explain how your partnerships with other private
entities have led to more energy efficient products coming into the
market. Have these partnerships been cost-effective?
Answer. The story of our partnership with Lennox Industries, cited
in my testimony, is a great example of how we've been able to work with
our partners to push the envelope in terms of efficiency gains.
According to Lennox, the rooftop heating and cooling unit they
developed for us is ``up to 66% more efficient than U.S. Department of
Energy Regulations.'' That unit is the one that has been installed on
all of our new U.S. stores and retrofits over the past year. We believe
that partnerships like this one are cost effective for us and good for
our customers.
Question 7. Wal-mart has the luxury of building most, if not all,
of their own stores in the United States. `New construction stores,'
provide you the opportunity to make these buildings energy efficient
from day one. What steps have you had to take with existing structures
in the United States, the UK and Japan that you have purchased to
incorporate into a Wal-Mart? What challenges have you had?
Answer. With the exception of daylight harvesting, most of our
other energy initiatives are easily retrofitted into existing stores.
Our stores in all of our countries are expected to meet the same
corporate / global goal of reducing greenhouse gas emissions by 20% by
2012. All of our countries share their best practices with one another
as to how they are going to achieve this goal. Regarding the U.K., they
have already exceeded this 20% goal in only half of the allotted time
frame.
Question 8. You make a very important point that as efficient as
your equipment might be, without the proper control technology, your
systems will never meet energy efficiency expectations. Can you
elaborate a little on the `sophisticated energy management system' you
use to monitor all of your stores from the home office in Bentonville,
AR? Do you have any thoughts on how this could be translated into a
smart grid system?
Answer. The Energy Management System allows us to monitor and
control the heating, air conditioning, refrigeration and lighting
systems for all stores and Sam's Clubs from Wal-Mart corporate
headquarters in Bentonville, Arkansas. Through the EMS we are able to
constantly monitor and control energy usage, analyze refrigeration
temperatures, observe HVAC and lighting performance, and adjust system
levels from a central location 24 hours per day, seven days a week.
This system is sophisticated and complex, but the functionality it
provides is quite simple: we can control our energy intensive systems
in real-time to conserve and use energy more efficiently. While the
households of the everyday Americans who shop in our stores may not
require this level of interaction, the promise of smart grid is that a
version of these very technologies will allow residential and smaller
commercial consumers to similarly make informed decisions about when
and how to consume energy.
Question 9. What has been the result of you sharing your
information and results with EPA, DOE, etc.?
Answer. One result was the formation of the Retailer Energy
Alliance (REA) at the Department of Energy. The REA provides a forum
for leading retailers to share information about energy efficiency and
conservation practices. Topics of focus include HVAC systems,
refrigerated display cases, interior and exterior lighting systems, and
integrated energy management systems.
Question 10. What was it that prompted Wal-Mart to make energy
efficiency adjustments, with the end goal of ultimately achieving 100%
renewable energy in your stores?
Answer. Energy efficiency has always been a business priority for
Wal-Mart. In 2005, our then-CEO Lee Scott announced a new corporate
sustainability initiative that had among its overarching goals for Wal-
Mart to ultimately be supplied by 100% renewable energy. Mr. Scott
believed that a strong commitment to sustainability would make Wal-Mart
a better and more innovative company and that as a leading corporate
citizen, we could contribute to America's energy security, provide more
sustainable products to our customers, and maintain our commitment to
low prices while addressing the real challenge of climate change.
Question 11. Have your collaborations with Lennox Industries, and
perhaps others, helped bring new efficient technologies to market that
otherwise may not have been developed? If so, please explain.
Answer. Our collaboration with Lennox grew out of our
sustainability commitments and has been an important partnership for
each of us. We've recently taken another step in our sustainability
commitment by creating the Wal-Mart Green Jobs Council comprised of
leading technology manufacturers to discuss ways to get more innovative
technology into the field by marrying Wal-Mart's large scale market
demand with innovation in design and supply of more sustainable
technologies from Wal-Mart's vendor community, with the end of goal of
preserving, protecting and creating more green jobs in the U.S.
Appendix II
Additional Material Submitted for the Record
----------
Statement of the Department of Energy
building technologies: program overview
Today, the nation's 113 million households and more than 4.7
million commercial buildings consume more energy than the
transportation or industry sectors, accounting for nearly 40% of total
U.S. energy use, including:\1\
---------------------------------------------------------------------------
\1\ 2008 Building Energy Data Book.
72% of electricity and 54% of natural gas
Energy bills totaling $392 billion each year
Contribute to 38% of Carbon, 18% of Nitrogen Oxide, and 55%
of Sulfur Dioxide emissions
Construction and renovation accounts for 9% of GDP and eight
million people are employed in the sector
The Building Technologies Program (BT) develops technologies,
techniques, and tools for making residential and commercial buildings
more energy efficient, productive, and affordable. BT's strategic goal
is ``To create technologies and design approaches that enable net-zero
energy buildings\2\ at low incremental cost by 2025. These efficiency
gains will have application to buildings constructed before 2025
resulting in a substantial reduction in energy use throughout the
sector.''\3\ To accomplish this goal, BT utilizes three strategies:
---------------------------------------------------------------------------
\2\ A net-zero energy building is a residential or commercial
building with greatly reduced needs for energy through efficiency gains
(60 to 70 percent less than conventional practice), with the balance of
energy needs supplied by renewable technologies.
\3\ 2008 Building Technologies Multi-Year Program Plan. http://
www.eere.energy.gov/buildings/publications/pdfs/corporate/
myp08complete.pdf
Research and Development
Technology Validation and Market Transformation
Appliance and Commercial Equipment Standards
The R&D subprogram has a whole buildings approach to energy
efficiency, considering the system interactions to develop optimal
solutions to Zero Energy Buildings.
Residential buildings are addressed through Building America
and the Builder's Challenge, which conduct systems research
with builder partners to reach Zero Energy Homes by 2020.
The Commercial Buildings works towards Zero Energy Buildings
through:
--National Energy Alliances--associations of building owners and
operators who share best practices, ideas, and needs for
energy efficient technologies and services
--National Accounts--builders and owners who commit to build new
buildings that use 50% less energy\4\ and retrofit existing
buildings for 30% energy savings.
---------------------------------------------------------------------------
\4\ Compared to ASHRAE 90.1-2004.
Emerging Technologies develops the new technologies and
strategies that address technical and market barriers to energy
efficiency. These technologies include advanced lighting,
building envelopes, windows, space conditioning, water heating,
---------------------------------------------------------------------------
solar heating and cooling, and appliance technologies.
Technology Validation and Market Transformation addresses market
transformation ensuring energy efficient technologies are implemented
in homes and businesses, through ENERGY STAR, Building Energy Codes and
Energy Smart Hospitals and Schools.
Appliance and Commercial Equipment Standards program addresses the
growing legislative requirements to increase energy efficiency by
implementing national efficiency standards for appliances and
commercial equipment. By eliminating the most inefficient technologies,
the program saves consumers money and reduces energy consumption.
______
International Council of Shopping Centers, Inc.,
Office of Global Public Policy,
Washington, DC, February 26, 2009.
Hon. Jeff Bingaman,
Chairman, Energy and Natural Resources Committee, U.S. Senate, 304
Dirksen Senate Building, Washington, DC.
Hon. Lisa Murkowski,
Ranking Member, Energy and Natural Resources Committee, U.S. Senate,
304 Dirksen Senate Building, Washington, DC.
RE: Hearing on Reducing Energy Consumption in Buildings
Dear Chairman Bingaman and Ranking Member Murkowski: Thank you for
this opportunity to add to the record of your February 26, 2009 Senate
Energy Committee Hearing seeking recommendations for reducing energy
consumption in buildings through innovative federal energy efficiency
policies and programs.
The International Council of Shopping Centers (ICSC) is the premier
global trade association of the retail real estate industry. Founded in
1957, ICSC has more than 70,000 members in the U.S., Canada, and over
90 other countries. ICSC represents owners, developers, retailers,
lenders, and other professionals as well as academics and public
officials. ICSC has over 5,000 public sector members including mayors,
city managers, and economic development and planning professionals.
Among its many initiatives, ICSC promotes retail development in
underserved urban and rural markets. ICSC's award winning Alliance
Program encourages public-private partnerships and open dialogue on
emerging issues impacting the retail real estate industry and the
quality of life in local communities, including sustainability and
energy efficiency.
ICSC's membership is well aware of the need to enhance energy
efficiency together with overall economic efficiency--particularly in
times of economic crisis. Yet ICSC is also aware that well intended
efforts to impose goals for specific reductions in energy consumption
may inadvertently result in economic harm to thousands of small
entrepreneurs, their employees and their customers.
The shopping center industry recognizes better than anyone that
``one size does not fit all.'' This is as true for the commercial
property sector as it is for shoes.
Therefore, ICSC would like to take this opportunity to highlight a
few of the distinct features of the retail real estate industry in the
hope of informing the discussion as Congress moves forward with a
national energy efficiency policy. Obviously, any such list will be
incomplete but ICSC hopes this information can serve as the beginning
of an important and necessary dialogue on diversity within the real
estate industry.
tenant mix
The tenant mix within a shopping center or mall determines the
energy consumption profile of the overall property. For example, a
grocery store (with significant refrigeration requirements) will
consume more electricity than a similar-sized shoe store. A restaurant
may consume more energy than a comparably sized boutique. The tenants
present in any particular shopping center will be determined by a wide
array of economic and demographic factors--and the tenant mix will
change over time.
Because of this complexity in the multi-tenant retail sector,
Energy Star benchmark ratings are not available for this format of
commercial property. Therefore, any federal legislation that relies
upon or incorporates Energy Star ratings should reflect this fact.
cooling and heating
Shopping centers and malls generally have a central unit to provide
heating, cooling and ventilation (HVAC) for the ``common area'' only.
This general rule has many exceptions among enclosed mall properties
but fewer exceptions at non-enclosed shopping centers such as the
typical grocery-anchored neighborhood center. Therefore, most retail
tenants will have a separate HVAC unit on the roof. Multiple sizes and
numerous manufacturers may be represented on a shopping center's roof
because the size and specifications for the HVAC system serving a
tenant's premises will be dictated by that particular tenant's needs
and the size and configuration of its premises.
triple net leases
Most shopping center tenant leases are ``triple net'' leases. While
not unique to retail properties, the triple net lease is pervasive
among shopping centers. A triple net lease is one where the tenant pays
a base rent as well as the tenant's proportionate share of the expenses
incurred by the landlord to operate the overall property. These
expenses include real estate taxes, property insurance and some repair
and maintenance costs. The tenants also typically pay for the costs to
operate their premises, including electricity consumption. There are
many varieties of the triple net lease and the details vary between
properties--even within a single multi-tenant property--and from
landlord to landlord and from tenant to tenant.
As if this contractual diversity were not enough of an obstacle to
rapid changes in pre-existing procedures, the traditional ``triple
net'' lease often lacks financial incentives for the landlord to
enhance the energy efficiency of an operating shopping center or mall.
The reason for this is that the landlord will typically have to bear
the upfront cost of the energy efficiency upgrade, while the tenants
typically would enjoy the benefits of reduced energy costs.
The retail real estate industry is developing appropriate lease
clauses to deal with many of the issues created by the traditional
triple net approach but it will take many years for existing leases to
be replaced by newer versions that take energy efficiency and advanced
sustainability practices fully into account.
``daylighting'' and skylights
Similar to a modern office building, in the typical multi-tenant
retail property, suspended acoustic tile panels are used as the
ceiling. Suspended ceilings have generally been seen as an obstacle to
the use of ``daylighting'' (skylights) in shopping centers. ``Big Box''
stores, which typically lack the suspended ceiling in favor of a
``warehouse'' look, have been better able to experiment with skylights
and have produced impressive results for direct energy savings.
However, for smaller tenants the suspended ceiling can reduce the
volume of air that must be heated or cooled, which itself can provide
energy savings. And existing multi-level properties have great
difficulty incorporating skylights on the lower levels. This is not to
say that daylighting cannot provide specific value--only that it should
be applied in the proper setting in a decision left to the private
property owner.
net metering and distributed generation
Simply ``saving'' energy will not be enough. If America's economy
is to grow with its population we will certainly need additional
sources of energy together with improvements in energy efficiency.
Therefore, any federal proposal that mandates or encourages energy
efficiency should count toward that goal each building or multi-tenant
property's on-site renewable power generation such as solar or wind.
Currently, limitations in solar technologies and manufacturing
capacities guarantee that solar is a highercost option than coal. As
the technology improves and the cost-per-kilowatt declines there will
still be obstacles to widespread use of on-site renewables. In
particular, the absence of a consistent national standard for ``net
metering'' means that many utility customers lack a key economic
incentive to produce carbon-free power to their maximum potential. Many
states have no allowance for net metering and many more have completely
inadequate standards, such as extremely low generation limits, or
``caps,'' which discourage the development of distributed and renewable
power.
Net metering is simply the regulatory requirement that utilities
allow interconnection for customer generated power with a direct offset
or payment for each kilowatt hour produced. In those states that allow
net metering, when the on-site capacity is fully consumed by the
customer-generator, the economic return is equivalent to the retail
price for electricity that the customer normally pays. However, many
utility companies refuse to pay anything near the retail price for any
excess power that is contributed to the grid by the on-site generator.
Often, the utility only pays a few pennies per kilowatt hour--a rate
the utilities call the ``avoided cost.'' Yet the utility delivers that
same power to other customers at the full retail price, even if the
power merely crossed the property line to the next building--or the
adjacent tenant in a sub-metered shopping center.
Because individual states have traditionally regulated these market
areas, there is a confusing quilt of net metering rules across the
country--despite the fact that the electricity transmission system is
truly a national asset. Indeed, Congress has recognized the national
scope of the distribution grid numerous times, most recently in the
energy provisions of the stimulus package dealing such as those
addressing the ``smart grid'' and transmission capacity. National net
metering and interconnection rules must be part of any future energy
package.
conclusion
The International Council of Shopping Centers and its individual
members stand ready to assist Congress as it investigates and
eventually addresses the nation's energy efficiency options. In
particular, we look forward to helping Congress develop environmentally
sound and economically sensible policies to enhance the energy
efficiency of private sector buildings.
Again, thank you for this opportunity to join the conversation
about this critically important issue.
Respectfully,
Kent Jeffreys,
Staff Vice President.
______
Statement of ConSol
achieving 30% and 50% over ashrae 90.1-2004 in a low-rise office
building
Prepared for: NAIOP
Date published: December 2008
abstract
This report documents technical analysis aimed at understanding the
practical and economical impacts of constructing a defined low-rise
office building at levels 30% and 50% above the ASHRAE 90.1-2004 Energy
Standard. The model evaluated was a 95,000 square foot, four-story,
Class A low-rise office building. EnergyPlus was the simulation tool
used for modeling building heating, cooling, lighting, ventilating and
other energy flows. Practical, above 90.1-2004 energy features were
determined by identifying building enhancements with less than a ten-
year utility savings' payback period. The analysis was not successful
in identifying practical energy feature upgrades to achieve the 30%
threshold. The best scenario evaluated achieved 23% over the ASHRAE
90.1-2004 Standard.
introduction
Several studies have highlighted the approaches required to design
highly efficient theoretical commercial buildings. Fewer though, have
focused on the energy saving potential of actual real world buildings.
ConSol responded to a request for proposal from NAIOP asking for an
analysis of a recently constructed low-rise office building, and the
practicality of building it 30% and 50% above the ASHRAE 90.1-2004
Energy Standard. The intention of this study is to form a high level
understanding of the above ASHRAE 90.1-2004 Standard potential in a
single model representative of a low-rise Class A office new
construction.
The objectives of this study are:
To construct an energy model that accurately predicts the
energy use of the low-rise office building provided;
To determine the baseline regulated energy use for the
building model in specific climate zones in the United States;
To determine the percent over ASHRAE 90.1-2004 that specific
energy feature upgrades provide;
To determine, via marginal cost of the energy feature
upgrades, practical limits of energy features within the
building model given a ten-year utility savings' payback
requirement.
This report is organized into three parts: methodology, results and
findings. Methodology describes the methods and assumptions used in
this analysis. Results outline the energy use and energy savings
potential of the features evaluated. Summary reviews the overall
results of the study and describes technical barriers encountered.
methodology
This section summarizes the methodology and assumptions used in the
undertaking of this analysis.
Simulation Software
Due to the important interaction between building energy systems in
commercial structures, ConSol deemed it appropriate to use EnergyPlus
v2.2 for this analysis. EnergyPlus is the U.S. Department of Energy
(DOE) building energy simulation program for modeling building heating,
cooling, lighting, ventilating and other energy uses. It is the most
advanced building simulation tool to date, building on many popular
features of legacy simulation engines, such as BLAST and DOE-2, and
including many new capabilities. The EnergyPlus simulations were
managed via the DesignBuilder v1.6 platform. DesignBuilder was chosen
for its intuitive and powerful 3D modeling capabilities as well as its
ability to organize the various energy efficiency measures employed.
Simulation Methodology
A modified version of ASHRAE 90.1-2004 Appendix G was used for this
analysis. Modifications include the exception of non-regulated loads,
baseline glazing and energy savings, not energy cost, as the above
ASHRAE 90.1-2004 metric. Percent savings are based on a code compliant
building as described in ASHRAE 90.1-2004 with the exception of
unregulated (receptacle and process) loads and baseline glazing
percentage. It was deemed appropriate for this study to focus solely on
regulated loads as only they could be affected by jurisdictional energy
codes such as the International Energy Conservation Code and ASHRAE
90.1 Standard. Baseline glazing was set at 50% to most accurately
maintain architectural similarity to the actual building as
constructed.
Prototype Building
The scope of this project required analysis of a specific low-rise
office building. NAIOP provided construction documents for a recently
completed office building with its specifications in the following
table:
TABLE 1: PROTOTYPE BUILDING DESCRIPTION
------------------------------------------------------------------------
Feature Description
------------------------------------------------------------------------
Building Type Low-Rise Office
------------------------------------------------------------------------
Total Area 95,000 square feet
------------------------------------------------------------------------
Number of Stories 4
------------------------------------------------------------------------
Average Story Height 14 feet
------------------------------------------------------------------------
Class of Construction A
------------------------------------------------------------------------
Percentage of Facade Glazing 50%
------------------------------------------------------------------------
Glazing Sill Height 4 feet
------------------------------------------------------------------------
HVAC System VAV with Terminal Reheat and Gas
Fired Boiler
------------------------------------------------------------------------
Climate Zones
Of the seven International Energy Conservation Code (IECC)/ASHRAE
climate zones in the continental United States (as depicted in Figure
1),* the scope of this analysis covers IECC Climate Zones 3, 4 and 5.
Table 2 describes the specific cities in which the office building was
evaluated. The IECC zones are categorized by Heating and Cooling Days
(HDD and CDDs), and range from the very hot Zone 1 to the very cold
Zone 7. Additional sub-zones A, B and C denote humid, dry and marine
climates, respectively.
---------------------------------------------------------------------------
* Figures 1-10 have been retained in committee files.
TABLE 2: CITIES AND CLIMATE ZONES EVALUATED
------------------------------------------------------------------------
City Climate Zone
------------------------------------------------------------------------
Newport Beach, CA 3B
------------------------------------------------------------------------
Baltimore, MD 4A
------------------------------------------------------------------------
Chicago, IL 5A
------------------------------------------------------------------------
Baseline Energy Features
Energy savings are demonstrated in comparison with a baseline model
that is minimally compliant with the ASHRAE 90.1-2004 Standard. Since
the 90.1 Standard has separate requirements for each climate zone, the
prototype building baseline was modeled individually to each climate
zone via the energy feature levels listed in Table 3.
TABLE 3: ASHRAE 90.1-2004 ENERGY FEATURES USED IN BASELINE MODEL
--------------------------------------------------------------------------------------------------------------------------------------------------------
City Newport Beach, CA Baltimore, MD Chicago, IL
--------------------------------------------------------------------------------------------------------------------------------------------------------
Envelope
--------------------------------------------------------------------------------------------------------------------------------------------------------
Roof R-19 R-19 R-19
--------------------------------------------------------------------------------------------------------------------------------------------------------
Walls R-13 R-13 R-13 + R3.8
--------------------------------------------------------------------------------------------------------------------------------------------------------
Floors R-19 R-19 R-19
--------------------------------------------------------------------------------------------------------------------------------------------------------
Glazing SHGC SHGC all = 0.19 SHGC all = 0.25 SHGC all = 0.26
------------------------------------------------------------
SHGC north = 0.26 SHGC north = 0.36 SHGC north = 0.36
--------------------------------------------------------------------------------------------------------------------------------------------------------
Glazing U-value 0.46 0.46 0.46
--------------------------------------------------------------------------------------------------------------------------------------------------------
HVAC
--------------------------------------------------------------------------------------------------------------------------------------------------------
EER 10.8 10.8 10.8
--------------------------------------------------------------------------------------------------------------------------------------------------------
Boiler Efficiency 0.78 0.78 0.78
--------------------------------------------------------------------------------------------------------------------------------------------------------
Aux. Energy 3.34 W/sqft 3.34 W/sqft 3.34 W/sqft
--------------------------------------------------------------------------------------------------------------------------------------------------------
Lighting
--------------------------------------------------------------------------------------------------------------------------------------------------------
Lighting Power Density 1.0 W/sqft 1.0 W/sqft 1.0 W/sqft
--------------------------------------------------------------------------------------------------------------------------------------------------------
It is important to note that while the climate zones evaluated vary
from mild to very cold, there are relatively little (slight) changes in
the minimally compliant requirements inherent to ASHRAE 90.1-2004.
Energy Efficiency Measures Evaluated
Energy efficiency measures assessed mainly consisted of increasing
efficiency in existing energy features of the building. Energy
efficiency measures evaluated included:
Enhanced wall insulation
Enhanced roof insulation
Varying levels of exterior glazing
Higher efficiency window assemblies
Reduced air infiltration via the installation of an air
barrier
Reduced lighting power densities
Higher efficiency HVAC equipment
Photovoltaic electricity energy generation
Of these measures, several were included as recommendations from
the ``Advanced Energy Design Guide for Small Offices'' (ASHRAE et al.
2004). We did not evaluate all efficiency measures available to office
buildings. For measures that could be included in a later study, see
Summary.
Cost Data
The majority of cost data was obtained through the ``RSMeans Green
Building Cost Estimating Database'' (Keenan et al. 2006). These costs
were usually available in per square foot or linear foot quantities and
were multiplied by the appropriate area or distance of material.
Increased costs related to HVAC auxiliary energy (fans, dampers, etc.)
were determined via ``RSMeans Mechanical Cost Data'' (Mossman 2005).
Few studies have determined the cost increases associated with reduced
lighting power density (LPD); however, the ``Development of the
Advanced Energy Design Guide for Retail Buildings--50% Savings'' (Hale
et al. 2008) provided insight to possible cost ranges. Although Hale's
work was based on a retail model, it was the only reduced LPD costing
data found suitable. Infiltration was assumed to decrease 0.15% via
installation of an air barrier with cost data found in ``Investigation
of the Impact of Commercial Building Envelope Airtightness'' (Emmerich
et al., 2005).
Costs not available from the above sources were determined via
personal correspondence with equipment manufacturers. Feature costs are
assumed constant at all locations. Table 4 outlines the marginal cost
increase, from code compliant material, associated with each energy
feature. Marginal cost increases were found by subtracting code
compliant feature cost from the upgraded energy efficiency measure
cost. Cost estimates were installed costs. Labor and material were
included.
TABLE 4: MARGINAL COST INCREASE PER ENERGY FEATURE
----------------------------------------------------------------------------------------------------------------
Energy Feature Marginal Cost Energy Feature Marginal Cost
----------------------------------------------------------------------------------------------------------------
Lighting = 0.8 W/sqft $60,420.00 R-26 Roof $16,362.73
----------------------------------------------------------------------------------------------------------------
Lighting = 0.9 W/sqft $30,210.00 R-32 Roof $30,387.92
----------------------------------------------------------------------------------------------------------------
Infiltration = 0.35 ACH $28,751.52 R-48 Roof $44,413.11
----------------------------------------------------------------------------------------------------------------
HVAC--aux.energy = +10% $29,563.73 R-48 Roof $67,788.44
----------------------------------------------------------------------------------------------------------------
HVAC--EER = 12.0 EER $12,409.11 R-19 Cool Roof $4,750.00
----------------------------------------------------------------------------------------------------------------
HVAC--EER = 11.5 EER $7,332.66 R-26 Cool Roof $21,112.73
----------------------------------------------------------------------------------------------------------------
Boiler Efficiency = 90% $17,500.00 R-38 Cool Roof $49, 163.11
----------------------------------------------------------------------------------------------------------------
R-17 Walls $2,300.65 Window Glazing = 40% N/A
----------------------------------------------------------------------------------------------------------------
R-26 Walls $7,870.63 Window Glazing = 30% N/A
----------------------------------------------------------------------------------------------------------------
Payback and Utility Rates
Energy efficiency measure marginal cost divided by annual utility
savings provided payback periods in years. Peak kilowatt savings were
not included. State average utility prices were taken from data
compiled by the Energy Information Administration (EIA 2007) and shown
in Table 5:
TABLE 5: AVERAGE COMMERCIAL UTILITY PRICES PER STATE
------------------------------------------------------------------------
City California Maryland Illinois
------------------------------------------------------------------------
Electricity ($/kWh) 0.1523 0.0847 0.1346
------------------------------------------------------------------------
Natural Gas ($/therm) 1.02 1.33 1.04
------------------------------------------------------------------------
results
This section summarizes the performance of the baseline models as
well as the energy efficiency measures evaluated.
Baseline Annual Energy Use
The annual energy use of the baseline, minimally code compliant
building is shown in Figure 2. Table 6 outlines the breakdown of energy
use by building system.
TABLE 6: BASELINE ENERGY USE BREAKDOWN
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Newport Beach Baltimore Chicago
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
MMBtu/year % of total MMBtu/year % of total MMBtu/year % of total
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Domestic Water Heating 271.3 8.3% 271.3 5.1% 271.3 4.2%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Lighting 985.5 30.2% 792.4 15.0% 801.4 12.3%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
System Misc. 1229.0 37.7% 1229.0 23.2% 1229.0 18.9%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Heat Generation 486.4 14.9% 2741.4 51.8% 4018.1 61.7%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Air Conditioning 286.0 8.8% 263.0 5.0% 197.8 3.0%
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Total 3258.2 5297.1 6517.5
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
An important point is the difference in annual energy use between
the mild and cold climates. Even though the minimally code compliant
model in Chicago has similar building features as the model in Newport
Beach, the colder Chicago climate drives the annual regulated energy
use to nearly double that of the Newport Beach model.
Comparison of Baseline Model to CBECS' Derived Benchmarks
Since the outputs from the EnergyPlus simulations are theoretical,
it is valuable to compare these predictions to available benchmarks of
energy use in comparable office buildings. The most recent Commercial
Building Energy Consumption Survey (CBECS) database contains energy use
estimates for nearly 4.9 million U.S. commercial buildings (EIA 2005).
A brief summary comparing our model's energy estimates and CBECS'
office building data is summarized in Table 7.
TABLE 7: ENERGYPLUS MODEL VERSUS CBECS COMMERCIAL DATA
----------------------------------------------------------------------------------------------------------------
Average of ConSol EP Models CBEC Data MMBtu/
MMBtu/year year
----------------------------------------------------------------------------------------------------------------
Domestic Water Heating 271.3 494.0
----------------------------------------------------------------------------------------------------------------
Lighting 859.8 1615.0
----------------------------------------------------------------------------------------------------------------
System Misc. 1229.0
----------------------------------------------------------------------------------------------------------------
Heat Generation 2415.3 3116.0
----------------------------------------------------------------------------------------------------------------
Air Conditioning 248.9 845.5
----------------------------------------------------------------------------------------------------------------
Total 4775.3 5225.0
----------------------------------------------------------------------------------------------------------------
Energy use from fans, dampers and other miscellaneous equipment
within the HVAC system are labeled ``System Miscellaneous'' in
EnergyPlus outputs, as opposed to the CBECS' database, which simply
adds this energy consumption to the ``Air Conditioning'' or ``Heat
Generation'' categories. With an approximate 9% difference in overall
annual energy consumption, the baseline EnergyPlus model results are
reasonable.
Energy Feature Reduction Potential
The following table and figures describe and summarize the
percentage above the ASHRAE 90.1-2004 Standard baseline each energy
efficiency measure provided. It is important to note that each energy
feature was evaluated independently. For example, 5.73% total building
energy savings was solely due to reducing the lighting system power in
the Newport Beach model from 1.0 watts per square foot (W/sqft) to 0.8
W/sqft.
TABLE 8: ENERGY EFFICIENCY FEATURES AND DESCRIPTIONS
------------------------------------------------------------------------
Energy Feature Name Description
------------------------------------------------------------------------
Lighting = 0.8 W/sqft Lighting power reduced from 1.0 watts per
square foot
------------------------------------------------------------------------
Lighting = 0.9 W/sqft Lighting power reduced from 1.0 watts per
square foot
------------------------------------------------------------------------
Infiltration = 0.35 ACH Building infiltration reduced from 0.5
air changes per hour
------------------------------------------------------------------------
HVAC--aux. energy = +10% Non direct heating/cooling energy use
(fans, dampers, controls, etc.)
efficiency increased by 10%
------------------------------------------------------------------------
HVAC--EER = 12.0 EER HVAC cooling equipment efficiency
increased from ASHRAE 90.1-2004 minimum
------------------------------------------------------------------------
HVAC--EER = 11.5 EER HVAC cooling equipment efficiency
increased from ASHRAE 90.1-2004 minimum
------------------------------------------------------------------------
Boiler Efficiency = 90% Service boiler efficiency increase from
ASHRAE 90.1-2004 minimum
------------------------------------------------------------------------
R17 & R-25 Walls Wall insulation increased from ASHRAE
90.1-2004 minimum
------------------------------------------------------------------------
R-48, R-38, R-32 & R-26 Roof Roof insulation increased from ASHRAE
90.1-2004 minimum
------------------------------------------------------------------------
R-38 & R-26 Cool Roof Roof insulation increased from ASHRAE
90.1-2004 minimum + roofing material
with solar reflectance 0.70 and
emittance 0.75
------------------------------------------------------------------------
Window Glazing = 30% & 40% Exterior facade glazing ratio reduced
from baseline ratio of 50%
------------------------------------------------------------------------
Energy Feature Payback via Utility Savings
Figures 6, 7 and 8 describe the payback period, in years, required
for each energy feature to offset its incremental cost via energy
savings. The alternative colored data points labeled ``PACKAGE''
represent a collection of energy features modeled together. These
features were chosen because together would have a collective payback
period of approximately ten years. The ten-year period was established
in the project scope of work and is considered acceptable to a majority
of commercial developers and owners. PACKAGE features are summarized in
Table 9.
TABLE 9: PACKAGE ENERGY FEATURES PER CLIMATE ZONE
----------------------------------------------------------------------------------------------------------------
Newport Beach Baltimore Chicago
----------------------------------------------------------------------------------------------------------------
R-26 Walls R-26 Walls R-26 Walls
----------------------------------------------------------------------------------------------------------------
R-38 Cool Roof R-38 Roof R-48 Roof
----------------------------------------------------------------------------------------------------------------
Lighting = 0.9 W/sqft Lighting = 0.9 W/sqft Lighting = 0.9 W/sqft
----------------------------------------------------------------------------------------------------------------
HVAC--EER = 12.0 EER HVAC--EER = 12.0 EER HVAC--EER = 12.0 EER
----------------------------------------------------------------------------------------------------------------
HVAC--aux. energy = +10% HVAC--aux. energy = +10% HVAC--aux. energy = +10%
----------------------------------------------------------------------------------------------------------------
Boiler Efficiency = 90% Boiler Efficiency = 90% Boiler Efficiency = 90%
----------------------------------------------------------------------------------------------------------------
Infiltration = 0.35 ACH Infiltration = 0.35 ACH Infiltration = 0.35 ACH
----------------------------------------------------------------------------------------------------------------
Practical Limits Over ASHRAE 90.1-2004
With the PACKAGE features noted in Table 9, the Chicago, Baltimore
and Newport Beach models achieved 23.0%, 21.5% and 15.8%, respectively,
over the ASHRAE 90.1-2004 Standard. These could represent the practical
and economical limits of current construction within this office
building model. Increased energy features from these levels would drive
the PACKAGE payback period well beyond the ten-year time horizon.
Additional energy savings are required to reach the 30% and 50%
goals. Outside of increasing building energy features, one way to do
this would be to generate electricity via photovoltaic panels. Assuming
the same incident solar radiation in Baltimore and Chicago as Newport
Beach, Figure 10 describes the approximate solar system size required
for the PACKAGE-enhanced models to achieve 30% over the ASHRAE 90.1-
2004 Standard.
These systems would cover approximately 11,000 square feet and
could be installed on the building rooftop. However, with an installed
cost of over $1.1 million (Keenan et al. 2006) and a payback period
between 55 and 100 years, they would be economically impractical
considering the industry accepted ten-year timeframe.
summary
Findings
This study was to determine if 30%--50% savings over ASHRAE 90.1-
2004 Standard in a defined office building was achievable within a ten-
year payback. This report finds that 30%, let alone 50% net site energy
savings, will be difficult to achieve in the low-rise office building
within the ten-year payback time frame.
The Newport Beach model achieved 15.8% over ASHRAE 90.1-2004.
Enhanced energy features used were: R-16 walls; R-38 roofing with a
cool roof coating; reduction of lighting power to 0.9 watts per square
foot; increasing HVAC cooling efficiency to 12.0 EER; increasing HVAC
auxiliary energy efficiency by 10%; increasing boiler efficiency to 90;
and reducing overall infiltration to 0.35 air changes per hour. At a
marginal cost increase of $169,898.13, this corresponds with a 12.2
year payback via utility savings.
The Baltimore model achieved 21.5% over ASHRAE 90.1-2004. Enhanced
energy features used were: R-16 walls; R-38 roofing; reduction of
lighting power to 0.9 watts per square foot; increasing HVAC cooling
efficiency to 12.0 EER; increasing HVAC auxiliary energy efficiency by
10%; increasing boiler efficiency to 90; and reducing overall
infiltration to 0.35 air changes per hour. At a marginal cost increase
of $165,148.13, this corresponds with an 11 year payback via utility
savings.
The Chicago model achieved 23% over ASHRAE 90.1-2004. Enhanced
energy features used were: R-16 walls; R-48 roofing; reduction of
lighting power to 0.9 watts per square foot; increasing HVAC cooling
efficiency to 12.0 EER; increasing HVAC auxiliary energy efficiency by
10%; increasing boiler efficiency to 90; and reducing overall
infiltration to 0.35 air changes per hour. At a marginal cost increase
of $188,523.45, this corresponds with an 8.8 year payback via utility
savings.
Several energy efficiency measures were not included in this study
due to lack of modeling capability, sufficient data or project scope.
Measures that warrant future study include solar thermal technologies,
geothermal heat pumps, underfloor air distribution systems, radiant
space conditioning, evaporative cooling technologies and light emitting
diode (LED) lighting systems.
Technical Barriers
As pointed out by Hale et al. in the ``Advanced Energy Design Guide
for Medium Box Retail'' (2008), achieving significant levels above
ASHRAE 90.1-2004 cost-effectively requires integrated building design,
that is a design approach that analyzes buildings as holistic systems
rather than as disconnected collections of individually engineered
subsystems. Examples of this type of approach include building design
that, at inception, revolve closely around the energy using systems.
One approach could be the integration of day lighting, geothermal air
conditioning and underfloor air distribution systems. Together, these
systems could prove substantial achievement over the 90.1-2004
benchmark. However, the design and subsequent construction of this
building, using a holistic approach, would be in significant contrast
to standard development practices that are designed to maximize
leasable area. This approach is employed by the majority of commercial
development in the United States.
As modeled in Newport Beach, a geothermal system (a potential
component of a holistic approach) would require more than two acres of
space--an impossibility for the project site. Assuming the same bore
depth, the geothermal space requirements would increase with colder
climates, such as Baltimore or Chicago. In the case of an underfloor
air delivery system, architecture and mechanical design would need to
accommodate distribution plenums, therefore increasing relative cost
and construction complexities.
There are many examples of successful holistic designs, but in the
case of this model, these approaches could be considered impractical.
This design philosophy will be a hurdle for the architects and build
teams of future commercial projects as it involves additional resources
during design and construction.
After upgrading building energy features, solar generation is the
current solution for additional energy savings over the 90.1-2004
Standard. However, installed solar cost would need to come down by a
factor of five for it to meet the ten-year payback criteria. This
presents a significant economic barrier. Federal, state and local
incentives can further reduce this barrier.
conclusion
Our model achieved 15.8% (Newport Beach, CA); 21.5% (Baltimore,
MD); and 23% (Chicago, IL) over the ASHRAE 90.1-2004 Standard. This was
done primarily by upgrading the building envelope insulation and
increasing efficiency of energy using sub-systems. Representing the
practical limit of current construction, together, these upgrades will
save enough energy in approximately ten years to offset their marginal
increase in cost. Solar can be used to make up the difference to 30%,
but with a payback timeframe exceeding 50 years.
______
Statement of Donna Harman, President and CEO, the American Forest &
Paper Association
The American Forest & Paper Association (AF&PA) appreciates this
opportunity to present the forest products industry's views regarding
recommendations for reducing energy consumption in buildings. AF&PA is
the national trade association of the forest products industry,
representing manufacturers of wood products, pulp, paper, and packaging
and forest landowners. Our companies make products essential for
everyday life from renewable and recyclable resources that sustain the
environment. The forest products industry accounts for approximately 6
percent of the total U.S. manufacturing GDP, putting it on par with the
automotive and plastics industries. The industry produces $200 billion
in products annually and employs more than 1 million people earning $54
billion in annual payroll. The industry is among the top 10
manufacturing sector employers in 48 states.
reducing energy consumption in buildings
AF&PA and its members are committed to reducing the environmental
impact of buildings by encouraging energy-efficient, environmentally
responsible choices during the design and construction process. Use of
green building ratings systems is one of the most effective means to
achieve both energy efficiency, and overall environmental
responsibility. Below we summarize the positive attributes of wood
building materials and green building rating systems, as well as a few
concerns about the inadequacies of some systems.
wood products and ``green'' buildings
Wood is among the most energy-efficient and environmentally
friendly of all building materials. It is less energy and carbon
intensive to produce than competing materials like steel and concrete.
Among other positive environmental characteristics, wood stores huge
amounts of carbon, contributing to the reduction of CO2 in
the atmosphere. Wood products are a vital component of sound
architectural design and construction, while providing inherent energy-
saving performance. Wood buildings are readily adapted to reuse or can
be deconstructed and individual products reused in new construction.
Lastly, wood is a renewable resource, a characteristic of unparalleled
environmental value.
Green building rating systems that do not fully recognize the
environmental benefits provided by the use of wood products are flawed.
We believe that rating systems should include all credible
sustainable forestry programs in the U.S. Equal credit should be given
to all programs that meet a commonly accepted set of objective
criteria, including globally-recognized sustainable forestry programs,
such as the Sustainable Forestry Initiative (SFI) program or the
American Tree Farm System. They should also include life cycle
assessment (LCA). It is critical that rating systems be grounded in
objective, scientific criteria based on life cycle impacts. LCA
provides objective criteria so that a rating system or standard yields
consistent results through appropriate thresholds and baselines, and
allows for the comparison of buildings in different locations on equal
terms.
It is also important that green building rating systems be
developed in a consensus process that meets the spirit of the American
National Standards Institute (ANSI) Essential Requirements\1\ or OMB
Circular A119. Development of a standard under a recognized consensus
process provides transparency and ensures the opportunity for
meaningful participation by all groups that will be affected. A true
consensus process also has procedures to ensure balance, consideration
of dissenting views, and appeals procedures. ANSI is the coordinator of
the U.S. standards process and provides strict objective requirements
for accreditation of those processes. A credible rating system must be
developed using a process that embodies the elements of consensus as
defined by ANSI.
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\1\ ANSI Essential Requirements: Due process requirements for
American National Standards (http://publicaa.ansi.org/sites/apdl/
Documents/Standards%20Activities/American%20National%20Standards/
Procedures,%20Guides,%20and%20Forms/
2008%20ANSI%20Essential%20Requirements/
2008%20ANSI%20Essential%20Requirements%20031108.pdf)
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Government entities should adopt green building policies that
recognize the energy-saving attributes of wood, are inclusive of forest
certification programs, based on sound science, including LCA, and have
been developed in a consensus process. AF&PA and its members will
continue to work with all interested parties to create and promote
green building rating systems that meet the above criteria.
green buildings and climate change
AF&PA recognizes that the environmental impact of buildings is
significant. Construction and operation of residential and commercial
buildings account for nearly 40 percent of all greenhouse gas (GHG)
emissions in the U.S. In particular, the more than 500,000 federally-
owned and leased buildings often consume more energy than non-
governmental buildings and require billions in energy costs. It is
critical that efforts to address climate change through green building
construction recognize the positive environmental benefits of wood
construction materials.
It has been shown that the use of wood building materials can help
mitigate the climate change impact of building construction. The
Consortium for Research on Renewable Industrial Materials (CORRIM), a
non-profit academic research consortium, undertook a study evaluating
the energy and environmental impact of leading building materials. The
study concluded that the use of wood-framing in buildings resulted in
the generation of 26 percent fewer CO2 emissions than for
comparable steel-frame buildings, and 31 percent fewer than for
concrete-frame buildings. Also, the study found that manufacturing wood
framing used at least 16 percent less energy than producing steel or
concrete frames, and had other environmental benefits, as well.
In addition, the ability of wood products to store carbon is
recognized internationally by climate scientists and policymakers,
including the most recent guidelines from the Intergovernmental Panel
on Climate Change. Nearly one-third of carbon sequestered in forests
becomes sequestered in the products made from them. Wood building
materials can store carbon for their useful life keeping it out of the
atmosphere for decades or even centuries. The EPA estimates that the
amount of carbon in wood and paper products is equivalent to removing
over 100 million tons of carbon dioxide from the atmosphere every year.
This is equivalent to eliminating the carbon dioxide emissions from 18
million passenger cars--13 percent of all passenger cars on the road in
the U.S.
green building rating system concerns
The U.S. forest products industry has been working for several
years to assure that green building rating systems provide appropriate
recognition for the positive environmental attributes of wood building
materials, and follow recognized standard development procedures that
assure fair treatment for all stakeholders. Unfortunately, the U.S.
Green Building Council (USGBC) has failed so far to incorporate this
recognition into its Leadership in Energy and Environmental Design
(LEED) green building rating system.
One of our primary concerns with the LEED program is its failure to
recognize all credible, sustainable forestry certification programs in
its certified wood credit. LEED only provides credit to builders using
forest products certified by the Forest Stewardship Council (FSC). No
credit is awarded for wood products produced by companies independently
third-party certified to the SFI program standard or the American Tree
Farm System (ATFS)--the two largest sustainable forest management
systems in the U.S., and both accredited by PEFC, a third-party
international group. These two programs account for over 100 million
acres of forestland, yet are unable to qualify for points under the
LEED rating system. This point structure forces builders to either
eliminate wood products from their designs, or if they nonetheless use
wood, must largely import their wood from overseas to receive LEED
credits for certified forest products.
Also, the LEED rating system does not recognize the positive
attributes of renewable wood products. For instance, LEED provides
credit for using ``rapidly renewable materials,'' which LEED
arbitrarily defines as products originating from plants grown and
harvested in a 10-year cycle. U.S.-based construction lumber does not
qualify for this credit since domestic timber is grown and harvested on
a longer rotation. The credit thus benefits exotic crops such as bamboo
from overseas or wheatgrass. This suggests that under LEED it would be
``greener'' to deforest an area of native trees that are being
sustainably managed and replace it with a plantation crop of an
invasive species like bamboo or wheatgrass. This is an outcome that
would have negative consequences for the environment.
Some building codes and a number of green building rating systems
rely on an American Society of Heating, Refrigeration, and Air
Conditioning Engineers standard, ASHRAE 90.1, to determine minimum
building energy performance, while others recognize other state-ofthe-
art energy codes. Since 1999, ASHRAE 90.1 has unfairly required greater
energy performance for wood wall construction than for walls
constructed of other materials. Wood walls quickly become economically
uncompetitive due to these more restrictive provisions. Energy codes
will only be effective when equal performance is demanded from all
building materials. Further, LEED relies entirely on ASHRAE 90.1 to
determine energy efficiency and, in the process, not only discriminates
against wood products, but gives preferential treatment to steel and
concrete, which are permitted to underperform wood walls. Providing
users with options in choosing rating systems will also help to
mitigate these energy performance penalties imposed by LEED. Further,
the Department of Energy should continue to review and revise the
energy performance requirements in the codes and standards it
references for this purpose.
Additionally, the federal government must turn its focus to the
existing building stock. In the case of residential construction, there
are more than 70-million one-and two-family dwellings across the
country. New starts represent 0.7 percent of all existing one and two--
family dwellings. It is important that the federal government focus on
the energy performance of existing buildings to maximize impact on
energy consumption.
Finally, every existing version of LEED was not developed in a
consensus process open to all interested parties. Our industry
specifically asked to participate and was rebuffed. The process USGBC
used to create and maintain these LEED versions did not meet generally
accepted criteria for development of consensus standards. While USGBC
has since obtained accreditation from ANSI as a green building
Standards Developing Organization, USGBC has not developed any existing
edition of LEED through their ANSI-accredited process.
legislation should recognize multiple rating systems
As the Committee is aware, several new green building rating
systems have been developed and entered the marketplace in the past few
years. Growing demand for building ``green'' is attracting competition
in the green building marketplace. We believe this competition is
healthy and will result in a rapid increase in the number of green
buildings in the U.S., as well as improvements in the rating systems
themselves.
As Congress continues to explore this issue and contemplates policy
options, we recommend that Congress avoid policies that may stifle
competitive forces that are driving the green building rating system
movement. We encourage Congress to explore and evaluate the full range
of systems now available in the marketplace beyond just LEED.
Legislation should not pick winners and losers in the constantly-
evolving green building marketplace, particularly as these rating
systems are private-sector products. Solely including references to the
LEED rating system prevents other credible systems, such as the Green
GlobesTM system for commercial construction and the National
Association of Home Builders' National Green Building Standard for
residential construction, from contributing to legislative goals.
conclusion
AF&PA appreciates this opportunity to present its views to the
Committee regarding the design and construction of these green
buildings. The forest products industry supports the construction of
environmentally-friendly and energy-efficient green buildings. We
believe that wood products can contribute greatly towards building
green if treated appropriately in rating systems and energy codes. It
is, therefore, important that legislation promoting green buildings not
specify one rating system, but rather make all credible systems
eligible to participate in its provisions. AF&PA and our member
companies look forward to working with the Committee and Congress on
this important set of issues.
______
Statement of J. Michael McQuade, Senior Vice President, Science &
Technology, United Technologies Corporation
introduction
As the Senate Committee on Energy and Natural Resources considers
energy legislation, United Technologies Corporation (UTC) offers
recommendations on cost effective, innovative and environmentally
friendly ways to address energy efficiency using a whole building or a
``systems'' approach. UTC is one of the largest capital suppliers to
the building industry worldwide and the development of both sustainable
and energy efficient products are of critical importance to the company
and the markets and customers that UTC serves.
Increasing energy efficiency in the building sector creates
significant opportunities to reduce energy consumption and costs for
producers and consumers, to develop new products, to commercialize
existing technologies and to create and maintain ``green'' jobs.
Increasing the efficiency of components in buildings--lighting,
ventilation and other major elements--has been and must continue to be
a key element of a policy to affect lower energy consumption. This
document outlines an approach to realizing significant energy
efficiency gains in buildings by adapting an integrated ``systems''
approach to design and operation. The integration of components is what
a systems approach is and the full scope of a systems perspective
includes the proper sizing of the components as well as the coupling of
components together in novel ways. The recommendations contained herein
serve the key U.S. goals of reducing dependence on foreign sources of
energy, combating climate change and expanding national
competitiveness:
The federal government, in close collaboration with the
private sector and academic community, should encourage
investment in a ``systems'' approach to building energy
efficiency including a focus on technology research and
demonstration projects, performance based measurements,
interoperable building systems, and education and manpower
training.
Congress should consider legislation that drives a market
transformation in the buildings industry and strategically
moves the United States toward net zero energy buildings. A
focus on economic recovery, energy efficiency, climate change,
tax and green building legislation is encouraged.
need for energy efficiency in buildings
The opportunity for energy savings through building efficiency
gains is tremendous. The building sector consumes about 40 percent of
the energy used in the United States and is responsible for nearly 40
percent of greenhouse gas emissions. Compare this with the entire
transport sector which represents only about 28 percent of energy use.
A 50 percent reduction in buildings' energy usage would be equivalent
to taking every passenger vehicle and small truck in the United States
off the road. A 70 percent reduction in buildings' energy usage is
equivalent to eliminating the entire energy consumption of the U.S.
transportation sector. These levels of energy reduction in buildings
are achievable but the United States today lacks the market and the
underlying science and technology infrastructure to broadly realize
these levels of efficiency improvements.
An integrated approach is needed to reduce energy use and
greenhouse gas emissions in the commercial buildings sector. The
building sector is made up of multiple stakeholders and decision
makers, including builders, architects, service and repair companies,
owners, realtors, product manufacturers and energy suppliers. Buildings
themselves are a complex web of equipment and energy sources that often
have limited connections and communications. We believe that
integrating the various separate technologies used in buildings, by
definition a systems approach, will cut energy consumption and cost. A
greater focus on systems requires coordination across technical and
policy solutions and among the fragmented building industry.
utc leadership on high-performance and sustainable buildings
UTC takes an active industry role in addressing building energy
usage. UTC is a co-chair of the three-year World Business Council for
Sustainable Development (WBCSD) project on Energy Efficiency in
Buildings (EEB). Along with thirteen other major multinational
corporations representing various aspects of building design,
construction, delivery and operations, UTC is working to identify the
barriers, levers, and necessary actions to achieve market
transformation and a pathway to net zero energy buildings (NZEB)--those
buildings that over a period of a year on average consume no energy.
Among other important findings of this project is the fact that
professionals in the building industry have widely underestimated the
impact of buildings on carbon emissions (by a factor of two) while
significantly overestimating the cost of sustainable construction (by a
factor of three). This knowledge gap is just one of several barriers to
market transformation of the building sector.
Increasing efficiency in buildings boosts productivity through the
reduction of energy costs. Developing better products that improve
energy efficiency offers new market opportunities. In 2006, George
David, at that time the CEO and Chairman of UTC, spoke at the WBCSD
meeting in Beijing:
The lessons I bring from UTC are that we can always reduce
costs and increase productivity and performance. The same is
true for environmental impacts and potentially to an even
greater degree because companies generally haven't worked at
these as hard as they have at costs and corporate
profitability. Remember that more than 90 percent of the energy
coming out of the ground is wasted and doesn't end as useful.
This is the measure of what's in front of us and why we should
be excited.
UTC has developed product offerings in the area of combined heat
and power (CHP) to take advantage of so called ``waste heat.'' By using
the heat escaping from prime movers used for power generation--
microturbines and reciprocating engines for example--and using this to
drive heating, ventilation and air conditioning equipment--for example
an absorption chiller to supply cooling or heat exchangers to supply
hot water--the overall efficiency of the combined system that supplies
power, heat and cooling to a building can move from around 33 percent
efficiency of the individual components to nearly 80 percent efficiency
of the combined system. This increase in efficiency is what a systems
perspective is all about. The fact that the system is located at the
point of use allows the building to productively use the waste heat and
avoid transmission line losses. The onsite attribute is a key component
of optimizing the system's performance.
systems approach and gaps
Two basic flaws in current design and operation of buildings
contribute to poor energy performance. First, the design and
construction of commercial buildings do not utilize methodology or
tools to identify and quantify interactions, or ``coupling,'' between
subsystems. Computational tools are not used initially in the design
phase nor are these couplings tracked during the changing construction
process. Second, the coupling between subsystems are neither monitored
nor controlled to avoid the erosion of performance in operation of the
building.
The key innovation in CHP products has been to increase energy
efficiency by engineering what have been separate elements into an
integrated whole. This is a ``systems view'' of the thermal exchange,
the energy production and the consumption of electric power, cooling
and hot water in the building. The integration of subsystems in the CHP
products can be enlarged to consider energy efficiency in the entire
building, namely looking at coupling through integrated design,
delivery and operation of what today are separate systems in the
building.
The goal to obtain significant energy efficiency gains should be to
design and operate systems and to fully couple the various elements of
buildings (e.g., building material, farcade, equipment) that consume
energy (e.g., lighting, heating, cooling) with other systems such as
sources of information (e.g., fire alarms, access control and other
security system devices) that taken together can increase
functionality.
The reality of today's methodology and tools is that attempting to
couple subsystems--even using higher performance (efficient) components
than are routinely used today--does not regularly deliver the levels of
efficiency gains needed and, in some cases, provides negative effects
from inefficient integration. Case studies show that even new buildings
that are constructed with the state of the art ``energy efficient''
technologies can fail to meet the design intent due to the detrimental
coupling of the modified subsystems. A study of high performance
buildings by the National Renewable Energy Laboratory (NREL) showed
that even with a range of advanced component technology (ground source
heat pumps, an under floor air distribution system, daylighting, and
high performance windows), when the systems were not properly
integrated, the building measured a 44 percent reduction ratio versus
80 percent when all components were fully coupled. Unfortunately, the
NREL results are not atypical and represent a significant barrier to
wide scale adoption of high-performance integrated building systems.
The systems approach considers a building as a complex dynamic
system that has considerable uncertainty in both operating parameters
and the operating environment. The coupling of components is difficult
to achieve and requires the development and use of new science and
engineering approaches to avoid the detrimental coupling discussed in
the NREL work above. The new science, design methodologies and tools
will then be used to capture the complex couplings, thus enabling
deployment of technologies that can take advantage of the natural
dynamics of the building (e.g., natural ventilation, thermal storage
concepts).
The misses in the demonstrations of highly efficient buildings
point to the promises and to the shortcomings that must be bridged with
additional investments in science and technology. The systems approach
can realize significant gains in energy efficiency and is a clear
pathway to realizing net zero energy buildings.
Technology enablers are emerging in much more capable ways of
modeling and simulating building performance (computational abilities)
and also much more capable ways of obtaining information from buildings
and using the information for real time control and diagnostics
(sensing and real time computation and embedded systems). The time is
right to make national investments and to bring industry together with
Department of Energy National Laboratories and universities to fully
realize energy efficient buildings.
recommendations
Congress should consider and enact legislation that promotes
investment in energy efficiency in the buildings sector. The American
Recovery and Reinvestment Act provided tax incentives to spur
investment in energy efficiency, funding for energy efficiency and
green buildings and support for various science and technology
programs. Congress should continue to focus on energy efficiency as it
considers comprehensive energy and climate change policy. For example,
the Senate Energy and Natural Resources Committee will be considering
legislation to require utilities to gradually increase the portion of
electricity produced from renewable resources. The Committee should
include energy efficiency as a component of renewable electricity or
clean energy standard legislation to encourage low emission, high
efficiency base load energy resources.
Also, as Congress considers climate change, energy, appropriations
and tax legislation that sustains a broad portfolio of energy efficient
and greenhouse gas reduction technologies, it should support a systems
approach to tying these technologies together in commercial buildings
and remove regulatory barriers to implementing near- and long-term
cost-effective net zero energy building approaches. In addition, energy
audits for existing buildings as a component of a comprehensive energy
efficiency policy will help ensure that existing property is operating
in the way it was designed--significantly reducing waste energy lost as
a result of poorly adjusted equipment.
UTC believes that investments to fully realize the benefits of
whole building design and operation must address a number of science
and technology issues including technology development, standards,
organization, facilities and talent.
Recommendation I: Measurement and Transparency.--The Federal
government and especially the National Institute of Standards
and Technology should consider establishing common measurements
to ensure that building performance can be effectively
evaluated by the marketplace. Such evaluation should include
the measurement of energy efficiency and indoor environmental
quality.
Recommendation II: Technology and Organization.--The Federal
government should create specific research programs carried out
in private-public partnerships to maximize the effectiveness of
technology development and transition. Research and technology
investments must be made in systems: the creation of system
engineering practices and associated design processes and
tools. The newly established Advanced Research Projects
Authority--Energy (ARPA-E) is supported by UTC and the
recommendation is to create an office within ARPA-E whose
investments would solely focus on systems methodologies, tools
and technologies for building energy efficiency. Projects in
the ARPA-E portfolio should be conducted on a multi-year basis
with joint university-National Laboratory-industry teams.
Recommendation III: Facilities.--The Federal government
should encourage public-private partnerships with incentives to
promote facilities that help users validate and test the
performance of hardware and software in a real integrated
building environment to reduce risk and enable wide-scale
commercialization. Demonstration projects to engage key
stakeholders in the buildings industry will reduce risk for
deployment to the entire building stock. The DOE Energy
Efficiency and Renewable Energy program portfolio should be
augmented with systems technology and methods should be matured
through relevant demonstration programs that are planned and
executed with joint multidisciplinary university-National
Laboratory-industry teams.
Recommendation IV: Talent.--The Federal government should
invest in education and training carried out to define the new
knowledge and skills required by the methods, systems, and
tools for deploying and maintaining systems. University and
government buildings and facilities should be used as case
studies and demonstration sites for advanced monitoring,
control, simulation models, prototypes, component, and systems
research. There must be engagement with all components of post
secondary education including professional and vocational
training with community colleges and other organizations for
building design, construction, commissioning, energy analysis,
energy accounting, and operations to ensure a talent base that
can design, install and maintain building systems.
Recommendation V: Strategic Roadmapping.--The Federal
government should catalyze the movement toward a whole-
buildings systems approach in the design of new buildings and
the renovation and retrofitting of existing buildings in order
to move toward net zero energy buildings. A national roadmap
for the development of net zero energy buildings should be
constructed jointly by Federal agencies and the private sector
to obtain alignment among research, development, demonstration
and market transition priorities from government, national
laboratories, universities and private industry. The Commercial
Buildings Initiative, as authorized under the Energy
Independence and Security Act of 2007, may be a vehicle to
implement a large and concerted multiyear initiative, with
sustained funding and with industry as a full partner, to
reduce commercial building energy use through a systems
approach.
Thank you for the opportunity to submit this testimony to the
Committee. We would be delighted to respond to any follow-up questions
regarding this testimony or the recommendations contained within.
______
Statement of J. Pauley, P.E., Vice President, Industry and Government
Relations, Schneider Electric and Chairman, High Performance Building
Council of the National Electrical Manufacturers Association
Chairman Bingham, Ranking Member Murkowski and members of the
committee, I am please to provide the perspective of an electrical
equipment manufacturer on the issue of reducing energy consumption in
buildings.
My company, Schneider Electric, is the world's electric power and
control specialist. We manufacture and market a comprehensive range of
products and services for the residential, buildings, industry, and
energy and infrastructure markets. Our United States sales were over
$3.4 billion in 2008 and we have over 14,000 employees in the United
States. Our Square D brand is recognized as the industry leading brand
in electrical power distribution.
The National Electrical Manufacturers Association (NEMA) is a trade
association of over 400 electrical manufactures. NEMA formed a High
Performance Building Council because of the extensive amount of
technology and resource that NEMA members have in the energy efficiency
arena. This council is a cross section of NEMA members; from lighting
systems and controls, to electric motors and drives and from power
transformers to building system controls and distribution equipment.
For over 75 years, NEMA has been wellrespected in standards writing,
and since we are the makers of the energy-efficient technologies, we
are happy to be a resource to congress as legislation is formulated to
make our country's buildings more efficient.
In the United States, buildings account for 20% of the overall
energy consumption. In order to have a significant impact on this
energy usage, it is critical that energy efficiency be implemented with
a combination of both passive and active energy measures. Passive
energy efficiency is achieved through the use of energy efficient
devices and by using energy efficient construction for buildings.
Efficient construction includes measures such as proper insulation for
the building, energy efficient windows and the use of design techniques
such as day lighting. Energy efficient devices are electrical devices
that are designed for low energy consumption such as energy efficient
lighting, transformers and similar equipment. We estimate that you can
achieve a 10-15% energy savings by taking advantage of such passive
measures.
Although the passive measures are a good start, there is more to do
to fully achieve the potential savings. There are active energy savings
to be achieved through proper control and use of the systems within a
building. A simple way to think of this is that an energy efficient
lamp will save energy, but it still wastes energy if it is left
switched on when not needed. By implementing permanent change through
monitoring and control of energy usage, another 5 to 15% of energy
savings can be achieved above the level achieved with a passive energy
approach alone. This means that systems such as lighting control and
adjustable speed drives for HVAC systems along with continued
monitoring and feedback are critical to sustain the energy savings.
Passive and active energy combined can bring up to a 30% savings in
overall energy usage for the building.
The need for monitoring of the system and integration with building
management systems should not be underestimated. Even the best energy
saving devices and systems can quickly lose their energy saving
qualities over time if they are not properly monitored. Occupants slip
back into energy-wasting behavior and slight changes to even the
automatic systems over time can result in a loss of savings. Through
proper monitoring and maintenance these changes can be detected and
corrective action taken much quicker. We estimate that up to 8% of the
expected energy savings can be lost if active monitoring of the
building is not in place.
In summary, energy efficiency must be looked at with a lifecycle
approach. Passive energy measures are used to fix the basics of the
building. An active energy approach is then implemented by optimizing
the system through automation and control of the energy using systems.
Finally, monitoring of the system along with proper maintenance are
used to continuously improve the system to achieve maximum savings.
As DOE programs are implemented and federal policies are developed,
the entire lifecycle of the energy efficiency systems must be taken
into account. Focusing on only passive systems will yield some
incremental results, but not achieve the level of savings that is
possible with a complete approach to energy efficiency.
Thank you for the opportunity to provide the perspective of the
electrical equipment manufacturing community on what we see as a very
important issue for the United States.
______
Statement of NAIOP, the Commercial Real Estate Development Association
study shows levels of achievable energy efficiency in buildings
Results show efficiencies unable to reach 30 percent mandates
HERNDON, Va., February 24, 2009--NAIOP, the Commercial Real Estate
Development Association, today released a report that demonstrates the
levels of energy efficiency that standard office buildings can reach
while remaining economically feasible.
The study was initiated to determine if commercial development
could achieve reduction targets of 30-50 percent above the ASHRAE 90.1-
2004 standard--the benchmark often cited in legislation and other calls
for mandatory reductions.
Using a recently completed four-story, 95,000 square-foot, Class A
office building as the prototype, the research modeled the prototype in
three climate zones represented by Chicago, Ill.; Baltimore, Md.; and
Newport Beach, Calif.
Findings show that although significant energy efficiencies can be
achieved (varying by climate zone), reaching a 30 percent reduction
above the ASHRAE standard is not feasible using common design
approaches and would exceed a 10-year payback. The study concluded that
achieving a 50 percent reduction above the standard is not currently
reachable.
``The study provides an unbiased insight into the energy targets
practical to commercial development today,'' said Thomas J. Bisacquino,
NAIOP president. ``Identifying an energy reduction level that is both
environmentally responsible and equitable to the developer is essential
in protecting the prosperity of commercial real estate.''
about the study
The study was conducted by ConSol, a California-based independent
energy-modeling firm, using the Department of Energy's EnergyPlus v2.2,
a building energy simulation program for modeling building energy uses.
Modeling included enhanced wall and roof insulations; varying
levels of exterior glazing; higher-efficiency window assemblies;
reduced air infiltration via the installation of an air barrier;
reduced lighting power densities; higher-efficiency HVAC equipment; and
photovoltaic electricity energy generation.
Using technologies and methods to increase effectiveness, the
maximum efficiency reached was 23 percent in the Chicago model. Results
across the climate zones vary by more than seven percent, given
baseline energy uses in domestic water heating; lighting; heat
generation; air conditioning; and fans, dampers and HVAC equipment.
Overall, energy savings, cost increases and payback periods are:
Chicago: 23 percent in energy savings; $188,523.45 cost
increase; 8.8 year payback;
Baltimore: 21.5 percent in energy savings; $165,148.13 cost
increase; 11 year payback;
Newport Beach: 15.8 percent in energy savings; $169.898.13
cost increase; 12.2 year payback.
``With the results of achieving higher efficiency targets differing
so greatly across the climate zones, the study reveals that a `one-
size-fits-all' approach to mandatory energy reductions does not work in
legislation or other mandates,'' said Bisacquino. ``It is important
that policymakers and others realize the economic consequences that
imposing mandated targets will have on the development industry.''
Study results show that employing solar generation technologies
could close the gap between the efficiencies achieved in the study and
the 30 percent above the ASHRAE 90.1 -2004 standard. However, at an
installed cost of more than $1 million and a payback of up to 100
years, it far exceeds practical and economical limits.
Additionally, elements of a holistic, integrated design approach
that could yield higher energy efficiencies were identified as
impractical in the study's building prototype, which represents more
than 50 percent of total new Class A commercial construction. For
example, in the Newport Beach model, a geothermal system (a component
of a holistic approach) required more than two additional acres of
space--an impossibility for the project site.
``We recognize that some buildings are able to achieve higher
energy efficiencies by employing various holistic design approaches,''
said Bisacquino. ``These approaches could become more economically
feasible with new technologies and federal, state and local
incentives.''
NAIOP commissioned the study as a proactive approach to engage the
commercial development industry in advancing an economically prosperous
and sustainable built environment. ``We are encouraged that study
results show that increased energy efficiency and building
profitability are not opposing concepts,'' said Bisacquino.
NAIOP has an ongoing commitment to providing its members with
tools, resources and education to aid in the employment of best
practices for energy efficient development. In June 2008, NAIOP
introduced an Energy Policy (www.naiop.org/resourcecenter/
greenresource/energypolicy.cfm) that encourages the development
industry to employ every technically feasible, cost-effective,
sustainable strategy available to increase energy efficiency of new and
existing buildings, and advances public policies that accelerate
ongoing energy efficiency and sustainability gains.