[House Hearing, 117 Congress]
[From the U.S. Government Publishing Office]
COST-SAVING CLIMATE SOLUTIONS:
INVESTING IN ENERGY EFFICIENCY TO PROMOTE
ENERGY SECURITY AND CUT ENERGY BILLS
=======================================================================
HEARING
BEFORE THE
SELECT COMMITTEE ON THE
CLIMATE CRISIS
HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTEENTH CONGRESS
SECOND SESSION
__________
HEARING HELD
APRIL 7, 2022
__________
Serial No. 117-17
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
www.govinfo.gov
Printed for the use of the Select Committee on the Climate Crisis
__________
U.S. GOVERNMENT PUBLISHING OFFICE
47-955 WASHINGTON : 2022
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SELECT COMMITTEE ON THE CLIMATE CRISIS
One Hundred Seventeenth Congress
KATHY CASTOR, Florida, Chair
SUZANNE BONAMICI, Oregon GARRET GRAVES, Louisiana,
JULIA BROWNLEY, California Ranking Member
JARED HUFFMAN, California GARY PALMER, Alabama
A. DONALD McEACHIN, Virginia BUDDY CARTER, Georgia
MIKE LEVIN, California CAROL MILLER, West Virginia
SEAN CASTEN, Illinois KELLY ARMSTRONG, North Dakota
JOE NEGUSE, Colorado DAN CRENSHAW, Texas
VERONICA ESCOBAR, Texas ANTHONY GONZALEZ, Ohio
------
Ana Unruh Cohen, Majority Staff Director
Sarah Jorgenson, Minority Staff Director
climatecrisis.house.gov
C O N T E N T S
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STATEMENTS OF MEMBERS OF CONGRESS
Page
Hon. Kathy Castor, a Representative in Congress from the State of
Florida, and Chair, Select Committee on the Climate Crisis:
Opening Statement............................................ 1
Prepared Statement........................................... 3
Hon. Garret Graves, a Representative in Congress from the State
of Louisiana, and Ranking Member, Select Committee on the
Climate Crisis:
Opening Statement............................................ 4
WITNESSES
Paula Glover, President, Alliance to Save Energy
Oral Statement............................................... 6
Prepared Statement........................................... 8
Darnell Johnson, President & CEO, Urban Efficiency Group; and
Vice Chair, Building Performance Association
Oral Statement............................................... 11
Prepared Statement........................................... 12
Dave Schryver, President & CEO, American Public Gas Association
Oral Statement............................................... 18
Prepared Statement........................................... 20
Sara Baldwin, Director of Electrification Policy, Energy
Innovation
Oral Statement............................................... 22
Prepared Statement........................................... 24
SUBMISSIONS FOR THE RECORD
American Public Gas Association's 2021 Winter APGA Board of
Directors Meeting Book, submitted for the record by Mr. Casten. 46
Article by Anne C. Mulkern in E&E News, ``Surging electric bills
threaten Calif. climate goals,'' submitted for the record by
Mr. Graves..................................................... 47
APPENDIX
Questions for the Record from Hon. Kathy Castor to Paula Glover.. 49
Questions for the Record from Hon. Mike Levin to Paula Glover.... 51
Questions for the Record from Hon. Kathy Castor to Darnell
Johnson........................................................ 52
Questions for the Record from Hon. Mike Levin to Darnell Johnson. 55
Questions for the Record from Hon. Garret Graves to Dave Schryver 57
Questions for the Record from Hon. Kathy Castor to Sara Baldwin.. 58
COST-SAVING CLIMATE SOLUTIONS:
INVESTING IN ENERGY EFFICIENCY
TO PROMOTE ENERGY SECURITY
AND CUT ENERGY BILLS
----------
THURSDAY, April 7, 2022
House of Representatives,
Select Committee on the Climate Crisis,
Washington, DC.
The committee met, pursuant to call, at 9:00 a.m., in Room
1334 Longworth House Office Building, Hon. Kathy Castor
[chairwoman of the committee] presiding.
Present: Representatives Castor, Bonamici, Brownley,
McEachin, Casten, Neguse, Escobar, Graves, Palmer, Carter,
Armstrong, and Crenshaw.
Ms. Castor. The committee will come to order. Without
objection, the Chair is authorized to declare a recess of the
committee at any time.
As a reminder, members participating in a hearing remotely
should be visible on camera throughout the hearing. For members
participating in person, masks are optional. As with in-person
meetings, members are responsible for controlling their own
microphone. And you can be muted by staff only to avoid
inadvertent background noise.
And as a reminder, statements, documents or motions must be
submitted to the electronic repository, to
[email protected].
Finally, if anyone's experiencing technical difficulties,
please alert the staff right away.
And welcome to the Cost-Saving Climate Solutions: Investing
in Energy Efficiency to Promote Energy Security and Cut Energy
Bills committee meeting. Today, we will explore how investments
in energy efficiency can save Americans money, reduce carbon
emissions, and promote energy security.
I will now recognize myself for 5 minutes for an opening
statement.
Well, on Monday, the world's top scientists, the
Intergovernmental Panel on Climate Change, issued another stark
wake-up call. We are behind. We are late. And we are running
out of time to limit warming and avoid catastrophic impacts and
rising costs. And unless we dramatically ramp up our efforts to
expand clean energy and reduce heat trapping pollution, the
consequences will be bleak. But America has the clean
technologies needed to avoid these costly impacts. But unless
Congress deploys them with urgency in partnership with
innovators and entrepreneurs, and across the economy, Americans
will be forced to pay more and more.
The economic case for cost-saving clean energy and energy
efficiency innovations is clear. In fact, the very first
recommendation in our committee's Climate Crisis Action Plan is
maximizing energy efficiency, one of the most cost-effective
solutions for nearly all sectors of the economy.
By making our transmission lines more efficient, we can
expand the reach of affordable renewables. By making renewables
more fuel efficient, and deploying electric cars and trucks and
fleets, we can save Americans money at the pump and avoid the
volatility of global oil and gas markets. And by investing in
energy efficiency in electrification upgrades, we can drive
down the cost of keeping the lights on, keeping appliances
running, and keeping the temperature agreeable inside and out.
Here's one example of how electrification can dramatically
improve efficiency: according to the Department of Energy,
electric vehicles use more than 75 percent of the energy they
get from the grid to get your wheels moving, whereas gas
vehicles only use about 12 to 30 percent of the energy from
gasoline. In other words, when you charge up your electric car,
you will use three-quarters of that energy to get where you are
going. But when you fill up your tank, you are using less than
a quarter. So that is $40 that you paid at the pump, just $10
of that gets you moving, and the rest is wasted.
So beyond cost saving potential, investing in cleaner,
cheaper technologies will also go a long way in building the
true American energy independence and security. Clean energy
investments support American workers, American industries, and
American manufacturers, instead of supporting foreign dictators
and big oil CEOs.
By maximizing these savings, we can reinvest them to
strengthen our most vulnerable communities. And we can deploy
transformative energy efficient technologies that could
potentially reduce heat trapping pollution by between 50 and 80
percent by the year 2050.
Federal investment in energy efficiency will put money back
into the pockets of Americans. The average household could save
up to $500 a year with the investments in the House-passed
reconciliation bill. Going even further would save households
even more. By electrifying everything, we could save families
thousands of dollars every year, and cut their energy use in
half. Those extra savings would be a godsend for Americans,
especially those least able to afford their energy costs.
So there is a common theme here. The cost of climate change
and the cost of energy seem to always fall on working families,
while oil and gas companies are reaping record profits.
Americans are paying more at the pump for last century's fuels,
meanwhile their communities are the ones suffering the economic
harms of climate fuel disasters which cost more than $145
billion last year. For too many Americans, it is hard not to
feel like they are getting ripped off. That is why President
Biden is working to lower energy costs and expand clean
technologies. The Biden administration is working to update
energy conservation standards for appliances, and to modernize
energy codes for Federal buildings. They are also working to
deploy the investments in the Bipartisan Infrastructure Law
which included more than $3 billion to make homes more energy
efficient and lower cost. Thanks to the infrastructure law, we
are also poised to build a national network of 500,000 EV
charging stations with a goal to make them as readily available
as gas stations.
So as we stare down the barrel of a costly climate
catastrophe, there is so much more that we must do. And the
world's top scientists did offer a hopeful note in their report
that reinforces the action we see across America. We have the
talent, the innovations, the tools, and the technology to save
consumers money, to reduce pollution, and provide a livable
planet for future generations. So I look forward to the insight
of our witnesses and our committee's discussion today.
[The statement of Ms. Castor follows:]
Opening Statement of Chair Kathy Castor
Hearing on ``Cost-Saving Climate Solutions:
Investing in Energy Efficiency to Promote Energy
Security and Cut Energy Bills''
April 7, 2022
As prepared for delivery
On Monday, the world's top scientists, the Intergovernmental Panel
on Climate Change, issued another stark wake-up call. We're behind,
we're late, and we are running out of time to limit warming and avoid
catastrophic impacts and rising costs. And unless we dramatically ramp
up efforts to expand clean energy and reduce heat-trapping pollution,
the consequences will be bleak.
America has the clean technologies needed to avoid these costly
impacts. But unless Congress deploys them with urgency, in partnership
with innovators and entrepreneurs and across the economy, Americans
will be forced to pay more and more.
The economic case for cost-saving clean energy and energy
efficiency innovations is clear. In fact, the very first recommendation
in our committee's Climate Crisis Action Plan is maximizing energy
efficiency, one of the most cost-effective solutions for nearly all
sectors of our economy. By making our transmission lines more
efficient, we can expand the reach of affordable renewables. By making
vehicles more fuel-efficient and deploying electric cars and trucks and
fleets, we can save Americans money at the pump and avoid the
volatility of global oil and gas markets. And by investing in energy
efficiency and electrification upgrades, we can drive down the costs of
keeping the lights on, keeping appliances running, and keeping the
temperature agreeable inside and out.
Here's one example of how electrification can dramatically improve
efficiency. According to the Department of Energy, electric vehicles
use more than 75% of the energy they get from the grid to get your
wheels moving, whereas gas vehicles only use about 12 to 30% of the
energy from gasoline. In other words, when you charge up your electric
car, you'll use three-quarters of that energy to get to where you're
going. But when you fill up your tank, you're using less than a
quarter. So that $40 you paid at the pump? Just $10 of it gets you
moving--and the rest is wasted.
Beyond the cost-saving potential, investing in cleaner, cheaper
technologies will also go a long way in building true American energy
independence and security. Clean energy investments support American
workers, American industries, and American manufacturers--instead of
supporting foreign dictators and Big Oil CEOs. By maximizing these
savings, we can reinvest them to strengthen our most vulnerable
communities. And we can deploy transformative energy-efficient
technologies that could potentially reduce heat-trapping pollution by
between 50% and 80% by the year 2050.
Federal investment in energy efficiency will put money back in the
pockets of Americans. The average household could save up to $500 a
year with the investments in the House-passed reconciliation bill.
Going even further would save households even more; by electrifying
everything, we could save families thousands of dollars every year and
cut their energy use in half. Those extra savings would be a godsend
for Americans, especially those least able to afford their energy
costs.
There's a common theme here: the costs of climate change and the
rising costs of energy seem to always fall on working families. While
oil and gas companies are reaping record profits, Americans are paying
more at the pump for last century's fuels. Meanwhile, their communities
are the ones suffering the economic harms of climate-fueled disasters,
which cost more than $145 billion just last year. For too many
Americans, it's hard not to feel like they're getting ripped off.
That's why President Biden is working to lower energy costs and
expand clean technologies. The Biden administration is working to
update energy conservation standards for appliances, and to modernize
energy codes for federal buildings. They're also working to deploy the
investments in the Bipartisan Infrastructure Law, which included more
than $3 billion to make homes more energy efficient and lower costs.
Thanks to the infrastructure law, we are also poised to build a
national network of 500,000 EV charging stations, with the goal of
making them as readily available as gas stations.
As we stare down the barrel of a costly climate catastrophe,
there's much more we must do. And the world's top scientists offered a
hopeful note in their report that reinforces the action we see across
America: we have the talent, the innovations, the tools, and technology
to save consumers money, reduce pollution, and provide a livable planet
for future generations. So I look forward to the insight of our
witnesses and our committee's discussion.
And at this time, I am happy to recognize the Ranking
Member, Mr. Graves. Good morning. You are recognized for 5
minutes.
Mr. Graves. Good morning, Madam Chair.
Thank you for having this hearing. And this is another
topic, Madam Chair, where you and I, I think, share a lot of
objectives. We have spent a lot of time talking about
resiliency and adaptation of our respective coastal states and
coastal districts, and the importance of making investments
there. Being from south Louisiana, we have had 90 percent of
the coastal wetlands lost in the Continental United States,
which does make our communities more vulnerable to hurricanes,
and sea rise, and other challenges related to sustainability.
This one, energy efficiency, look, if we can reduce the
consumption of energy in things that we are doing, whether it
is in our business, it is driving vehicles, it is
manufacturing, then that helps improve the competitiveness of
the United States. Energy efficiency and energy conservation
efforts are absolutely critical in our long-term objectives
here. And it is a no-regrets approach, because it allows us to
reduce the cost of utility bills for consumers that are
struggling with their ability to pay their bills today. It
helps to reduce the cost of fueling vehicles in order to get to
work or go to school, or spend time with family. Those are all
win-wins, and there are no regrets. It improves the
competitiveness of the United States.
But Madam Chair, I think something that is really important
to keep in mind as well is the international perspective here.
You are right, IPCC did release a new report last week. And it
is interesting, because what has happened with Ukraine has sort
of made, I think, a lot of people realize the United States is
one country in a very large global community. And you have
people that operate by different standards. And we often find
ourselves trying to apply American values, American ethics,
American standards to other countries.
How do you think Vladimir Putin feels about that? How do
you think he feels about America's values, our standards? Look
at what he is doing. He is just completely just rolling over
people. No respect for human rights. No respect for
sovereignty. Yet, he is going to be a partner in climate
change? Not a chance in hell.
What about President Xi in China? You think looking at what
they are doing with slave labor and child labor, the way that
they completely abuse the Uyghurs in human rights. Do you
really think that China is going to have any respect for human
rights? China's released 4 tons of emissions, increased 4 tons
of emissions for every one ton we have reduced. I think that we
are looking at ourselves a little bit more--as a bit more
inflated than we really are. We are not going to be able to
solve this issue on our own. Let me say it again, China has
increased emissions 4 tons for every one ton of emissions we
have reduced. That is moving in the wrong direction globally.
Yet, we are sitting here talking about spending not millions,
not hundreds of millions, not billions, tens of billions and
hundreds of billions of dollars to try to save the planet
whenever we have got other international actors that don't
care. They don't care.
Let me read you something. President Biden's energy plan is
going to result in higher electricity prices, higher prices at
the gas pump, lost revenue sharing for hurricane protection,
flood control, and coastal restoration, higher delivery costs,
meaning delivery of groceries and all products, more dependence
on foreign energy from China, Russia, Iran, and other
countries, and a net increase in global emissions.
Madam Chair, all of those things--let me run through them
again. Higher electricity prices. Check, we are seeing it.
Higher prices at the gas pump. Check, we are seeing it. Lost
revenue, because as a result of not doing lease sales, the
first President in modern history to not do energy lease sales,
we are losing revenue. The United States Treasury is losing
revenue, which means because we have revenue sharing for
offshore energy production--my home state, one of the most
powerful hurricanes to ever made landfall, Hurricane Ida, we
are not getting the revenues that we should have to build
hurricane protection restoring our coastal ecosystem and other
projects, flood control. So that one we have realized.
Higher delivery costs. With inflation and supply chain we
are getting high costs there. More dependence on foreign energy
from China, Russia, and others. We are seeing that. A net
increase in global emissions. We have seen that.
This is a statement that I made on January 27th of last
year. Madam Chair, I am all for--I am all for the objectives
that you have stated. But we have got to have a strategy that
is actually global looking in nature, and one that truly
achieves the objectives, not one that just thrusts costs on the
United States taxpayers and makes energy unaffordable, and
doesn't achieve what I believe are our common environmental
goals.
I yield back.
Ms. Castor. Now I want to welcome our witnesses. We have
got a great panel to talk about the benefits of energy
efficiency. Paula R. Glover is the President of the Alliance to
Save Energy. Ms. Glover leads a diverse coalition of
stakeholders to find lasting consensus-based energy efficiency
solutions. She has helped the Alliance secure billions of
dollars in Federal funding for energy efficiency programs,
amplified its work on energy justice, and worked to advance the
next generation of technologies.
Darnell Johnson is the CEO and President of Urban
Efficiency Group, Illinois' first minority-owned utility
implementation contractor and sustainability design firm run by
and for Chicagoans. His work with UEG has assisted thousands of
underserved residents in Indiana, Illinois, and Wisconsin,
helped them reduce their energy burden by delivering energy
efficiency and clean energy to communities.
Mr. Johnson is also the Vice Chair of the Building
Performance Association and Chair of its Diversity, Equity and
Inclusion Committee.
Dave Schryver is the President and CEO of the American
Public Gas Association. Mr. Schryver leads APGA's work to
represent the interest of America's publicly owned natural gas
local distribution companies before Congress, Federal agencies,
and other energy-related stakeholders.
And Sara Baldwin is the Director of Electrification Policy
at Energy Innovation. Ms. Baldwin leads the firm's
Electrification Policy practice area, providing research and
analysis on the pathways to electrify and decarbonize
buildings, transportation, and industry.
Without objection, the witnesses' written statements will
be made part of the record.
With that, Ms. Glover, you are now recognized 5 minutes to
summarize your testimony. Welcome.
STATEMENTS OF PAULA R. GLOVER, PRESIDENT, ALLIANCE TO SAVE
ENERGY; DARNELL JOHNSON, CEO AND PRESIDENT, URBAN EFFICIENCY
GROUP (UEG), AND VICE CHAIR, BUILDING PERFORMANCE ASSOCIATION;
DAVE SCHRYVER, PRESIDENT & CEO, AMERICAN PUBLIC GAS ASSOCIATION
(APGA); AND SARA BALDWIN, DIRECTOR OF ELECTRIFICATION POLICY,
ENERGY INNOVATION.
STATEMENT OF PAULA R. GLOVER
Ms. Glover. Thank you very much. Chair Castor, Ranking
Member Graves, members of the House select committee----
Ms. Castor. Ms. Glover, will you pull the mic up a little
closer?
Ms. Glover. How is that?
Ms. Castor. That is a little better.
Ms. Glover. Thank you.
Chair Castor, Ranking Member Graves, members of the House
Select Committee, my name is Paula Glover. I am the President
the Alliance to Save Energy. And I really appreciate you having
me at today's hearing.
The Alliance is a nonprofit. We are a bipartisan coalition
of business, government, environmental and consumer leaders,
working to expand the economy while using less energy, doing
more and using less. We were founded in 1977 by Senator Charles
H. Percy from Illinois, and Senator Hubert Humphrey from
Minnesota in response to the oil embargo and the energy crisis
at that time.
Today, in addition to a potential energy crisis resulting
from the pandemic, and the geopolitical crisis in Europe, we
are also moving closer to a climate crisis, the climate tipping
point. And this requires us to develop climate change solutions
while also meeting the challenges of energy security and
affordability.
We are required to lead in energy production, but we must
also lead in energy efficiency throughout all sectors of the
U.S. economy, including manufacturing, transportation, and
agriculture, and the built environment. And as we make these
investments in efficiency products, equipment, supplies, and
technologies, and as consumers in businesses adopt efficiency
solutions, energy consumption is reduced and generation and
production supplies are offset through lower demand.
In fact, without these investments made in efficiency since
1980, energy consumption would have been more than 60 percent
higher. And these same investments help consumers avoid
approximately $800 billion a year in energy costs. That is the
power of efficiency. This is achieved by investments that
secure the building envelope, equipment standards, building
codes, building design, and establishing policies that
prioritize efficiency as a primary part of U.S. domestic
policy----
And I am having a problem here. Excuse me. I am sorry. And
I apologize. I am having a problem with my technology.
I do not. And that's probably why I am having a problem.
At the end of the day, efficiency needs to play an
essential role in U.S. energy policy, and should be seen as a
necessary and critical to help address our challenges,
including climate. Efficiency investments are more critical
when considering avoiding infrastructure costs, in addition to
creating greater system reliability because of that reduced
demand.
Moreover, efficiency is one of the most cost-effective and
fastest ways to reduce emissions. And as indicated in a recent
report, Halfway There, efficiency alone can reduce carbon
emissions by 50 percent by 2050. And according to the
International Energy Agency, over 40 percent of the emission
reduction objectives of the Paris climate agreement can be
reached to efficiency by 2040.
Further, if we are talking about economic impact, energy
efficiency is the largest employer in the clean energy economy.
We employ over 2.1 million people in the United States. And
energy efficiency jobs are located in all but six counties in
this country. We are local. We do this locally. We pay, on
average, $24 an hour, or 28 percent higher than the national
median. And so, as you consider moving forward with budget
reconciliation, and tackling our challenges, and future
preparedness, we urge you to look at efficiency and make
substantive investments. Investments, tax credits like 25C,
179D, 45L are important to get us moving over, moving forward.
In addition to programs like HOPE for HOMES, building codes,
and the like.
We thank you for your leadership on these issues. And, of
course, are available for any questions that you may have.
Thank you.
[The statement of Ms. Glover follows:]
Written Testimony of Paula R. Glover
President, Alliance to Save Energy
Before the House Select Committee on the Climate Crisis
Hearing on ``Cost-Saving Climate Solutions: Investing in Energy
Efficiency
to Promote Energy Security and Cut Energy Bills
April 7, 2022
Chair Castor, Ranking Member Graves, members of the House Select
Committee on the Climate Crisis, my name is Paula Glover, and I am
President of the Alliance to Save Energy. I thank you for inviting me
to participate in today's hearing titled Cost-Saving Climate Solutions:
Investing in Energy Efficiency to Promote Energy Security and Cut
Energy Bills.
The Alliance to Save Energy is a nonprofit, bipartisan coalition of
business, government, environmental and consumer leaders working to
expand the economy while using less energy. Our mission is to promote
energy productivity worldwide--by advancing energy efficiency policy to
achieve a stronger economy, a cleaner environment and greater energy
security, affordability, reliability, and equity.
The Alliance was founded in bipartisanship in 1977 by Senator
Charles H. Percy (R-IL) and Senator Hubert Humphrey (D-MN). The
organization was launched at a time not too dissimilar from today, when
an instability in energy supplies exposed a fundamental weakness in our
nation's economic and energy security. The challenges of the period
required the nation to identify and develop solutions that would place
the U.S. on a more secure energy path, less reliant on foreign
resources with greater investments and development of energy
technologies here at home. For Senators Percy and Humphrey, energy
efficiency and demand-side solutions would provide part of the answer.
Today, in addition to a potential energy crisis resulting from the
COVID-19 pandemic and the geopolitical crisis in Europe, we are also
moving closer and closer to the climate tipping point. This requires us
to develop climate change solutions while also meeting the challenges
of energy security and affordability. We are required to lead in energy
production--but we must also lead in energy efficiency.
However, the issue of energy security is not simply about supply.
As Senators Percy and Humphrey identified 45 years ago, we must also
invest in reducing energy demand through energy efficiency. Energy
efficiency investments reduce energy intensity throughout all sectors
of the U.S. economy--including manufacturing, transportation, in
agriculture, and the built environment. In fact, but for investments
made in energy efficiency since 1980, energy consumption would have
been more than 60% higher.\1\
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\1\ https://energyefficiencyimpact.org.
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When measuring energy consumption, industry and manufacturing
account for 33% of all energy consumed; transportation equals 26%; and
the residential and commercial built environment represent 22% and 18%
respectively.\2\ As we make investments in energy efficiency products,
equipment, supplies, and technologies--and as consumers and businesses
adopt efficiency solutions, energy consumption is reduced, and
generation and production supplies are offset through lowered demand.
This is achieved by investments that secure the building envelope,
equipment standards, building codes, building design, and establishing
policies that prioritize energy efficiency as a primary part U.S.
domestic policy.
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\2\ https://www.eia.gov/energyexplained/use-of-energy/.
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Energy efficiency also effectively addresses the issue of climate
change--and should be used as the first solution to the climate crisis.
As indicated in the recent report Halfway There, energy efficiency
alone can reduce carbon emissions by 50% by 2050 \3\, and according to
the International Energy Agency (IEA), over 40% of the emission
reduction objectives of the Paris Agreement can be achieved through
energy efficiency by 2040.\4\ Through energy efficiency standards and
labeling alone, the U.S. already avoids 343 metric tons of carbon
emissions each year.\5\
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\3\ https://www.aceee.org/fact-sheet/halfway-there.
\4\ https://www.iea.org/commentaries/how-energy-efficiency-will-
power-net-zero-climate-goals.
\5\ https://www.iea.org/reports/achievements-of-energy-efficiency-
appliance-and-equipment-standards-and-labelling-programmes/executive-
summary.
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Finally, as efficiency effectively delivers on its ability to
increase energy security and mitigate climate change, it also makes
energy more affordable. As a result of the efficiency investments made
since 1980, consumers avoid approximately $800 billion per year in
energy costs.\6\
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\6\ https://energyefficiencyimpact.org.
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This is the power of energy efficiency--reduced carbon emissions;
reduced demand on supply; and billions of dollars in savings for
consumers--all of which directly impact today's challenges of energy
and national security, energy affordability, and climate change.
Furthermore, energy efficiency has a positive impact on the
economy. Energy efficiency is currently the largest employer in the
clean energy workforce, employing over 2.1 million people in the U.S.--
nearly seven times that of the wind and solar industries combined, and
12 times the size of the entire coal industry. These jobs pay on
average $24.44 an hour, or 28% higher than the national median hourly
wage.\7\
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\7\ https://e4thefuture.org/wp-content/uploads/2021/10/Energy-
Efficiency-Jobs-in-
America_National-Summary-2021.pdf.
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To advance the multiple positive benefits of energy efficiency as a
tool for national security, energy affordability, and climate change--
and I would add economic growth--there should be a whole of government
approach. This means prioritizing the role of energy efficiency
targeting the major sectors of the U.S. economy, including industry,
transportation, and the residential and commercial built environment.
As federal dollars are released and deployed through agencies and
programs, policies should ensure that national energy efficiency
objectives are substantively linked. This includes energy efficiency as
connected to small business activity, affordable housing funding,
mortgage lending, agriculture, commerce investments, and elsewhere.
This means retrofitting and modernizing the nation's critical
facilities and public buildings--through direct investments, improved
codes and standards, by leveraging private public partnerships, and
through other measures. And this should also be across the federal
footprint.
This also means research, development and commercialization of
Active Efficiency technologies, which are the application and use of
digital energy efficiency, including grid-integrated enabled buildings,
and technologies that allow single and multiple buildings to take on,
shift, and share load on a continuous basis.
We should employ these same solutions in the residential built
environment, and with an emphasis on equity. According to research
conducted by the Alliance to Save Energy on single-family
homeownership, of the nearly 74.5 million owner-occupied households,
35.2 million are households with annual incomes below $60,000.\8\
Moreover some of these same households represent families with the
highest energy burden, with rural households having the highest energy
burden when compared to other groups.\9\ At the same time, when
segmenting energy burden by race, when compared to white households,
Blacks spend 43% more of their income on energy costs, Hispanics, 20%
more, and Native American households 45% more.\10\
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\8\ All data from 2015 EIA RECS.
\9\ https://www.aceee.org/press/2018/07/rural-households-spend-
much-more.
\10\ https://www.aceee.org/press-release/2020/09/report-low-income-
households-communities-color-face-high-energy-burden.
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To effectively deploy energy efficiency solutions in these homes,
and to secure the full benefits of energy security and emission
reductions, we must include these households as we deploy identified
energy efficiency investments. This will also result in lower energy
costs for these families, and reduced energy burden.
That said, we must also address energy efficiency for renters,
where multi-family households under $60,000 in annual income equal 33.4
million households out of 43.7 million.\11\ These families often have
little control over the energy efficiency investments in their homes,
requiring policies and investments to incentivize landlords, including
building performance standards, energy codes, tax incentives, and other
mechanisms.
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\11\ All data from 2015 EIA RECS.
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As we consider transportation, efficiency opportunities exist
across the sector, including light and heavy vehicles, aviation, marine
technologies, and rail. However private investments are costly, and
research and development to advance future technologies are required,
especially in aviation, rail, and marine engine performance. That said,
on-the-road vehicles equal approximately 82% of transportation energy
use, which makes the application of fuel efficiency standards in
addition to investments in alternative fuel vehicles essential to
reducing transportation energy demand.\12\ As a brief example of the
energy efficiency impact of electric vehicle (EV) technology as an
alternative, EVs convert up to 77% of the charged energy to the vehicle
and braking systems versus 12%-30% for vehicles powered by
gasoline.\13\
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\12\ https://afdc.energy.gov/conserve/system_efficiency.html.
\13\ https://www.fueleconomy.gov/feg/evtech.shtml.
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From the industrial perspective, the U.S. Department of Energy
(DOE) has taken the lead through its Better Plants Program, the purpose
of which is to improve energy efficiency and sustainability through
partnerships with some of the nation's leading manufacturers and water
and wastewater treatment agencies. Total program participants equal
3,500 facilities and 13.8% of the U.S. manufacturing energy footprint.
Most recent reporting indicates that program participants have avoided
more than 1.9 quadrillion Btus and saved $9.3 billion in energy
costs.\14\ Avoided energy use and energy savings should be increased
exponentially but will require greater support for and expansion of
initiatives like the Better Plants Program and other related projects,
including incentives for manufacturers to increase energy efficiency
investments.
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\14\ https://betterbuildingssolutioncenter.energy.gov/sites/
default/files/attachments/2021_Better_Plants_Progress_Update.pdf.
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With the above in mind, we also see investments in energy
efficiency as essential to the reliability of the electric grid. This
is particularly true as policy and markets shift a substantive share of
energy demand toward electrification. Based on analysis and depending
on the rate of electric vehicle (EV) adoption, we should anticipate
significant future growth in grid load. According to the Brattle Group,
if the projected rate of EV growth increases from 1.5 million in 2020
to 10-35 million by 2030, we will need grid investments up to $125
billion across the electric power sector--and that's to serve 20
million EVs.\15\ These vehicles will add 60-95 terra-watt hours (TWh)
of electricity demand to the grid annually, in addition to 10-20
gigawatts (GW) of peak load, which in turn would require 12-18
gigawatts of generation capacity from renewable energy.\16\
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\15\ https://www.brattle.com/insights-events/publications/electric-
power-sector-investments-of-75-125-billion-needed-to-support-projected-
20-million-evs-by-2030-according-to-brattle-economists/.
\16\ Id.
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These investments will come at a cost. There will be a cost to
develop and deploy the infrastructure, and there will be a cost
transferred to consumers and businesses. Brattle estimates that $30-50
billion will be needed for generation and storage, with $15-$25 billion
needed for transmission and distribution upgrades, and another $30-$50
billion for charging and customer related infrastructure.
Although some of these costs will be offset as we factor in fuel
switching, carbon reductions, and the future ability of EVs to shed and
share load, the payback is not immediate.\17\ In all likelihood,
consumers will realize an increase electricity costs, which will be
necessary to ensure that the grid is reliable and able to meet consumer
demand. However, energy efficiency can help avoid some of these
increased costs, while also adding greater grid reliability.\18\
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\17\ Id.
\18\ https://www.ase.org/blog/does-grid-study-many-reminders-
success-energy-efficiency.
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This is particularly true as we think about Active Efficiency when
combined with traditional passive efficiency measures including
building envelope retrofits. Active Efficiency reduces consumption
through demand flexibility, and also reduces load through technologies
that allow appliances, buildings, communities, neighborhoods, and
potentially whole cities to shift, share, and shed load on a continuous
basis.
In conclusion, the energy transition is here. However, if we fail
to lead with energy efficiency, then our investments in the transition
will have sealed-in decades of energy waste, in addition to lost
savings for consumers. From a policy perspective--including as we think
about national security and the nation's energy security--when
forwarding policies on electrification, we must lead with energy
efficiency. As we deploy renewable generation assets and related
transmission and distribution investments, we must lead with energy
efficiency. And as we identify future investments in oil, natural gas,
coal, and carbon capture, we must lead with energy efficiency. We have
the ability through investments in demand-side solutions to directly
lower the level, rate, and cost by which we consume our energy
supplies.
The focus on energy efficiency in the Infrastructure Investments
Jobs Act (IIJA), and what might come out of a budget reconciliation
package are a good start, including but not limited to facilitation of
energy code adoption, funding for the Weatherization Assistance
Program, grants for schools and non-profits, and other measures.
However, congress must also ensure passage of key investments proposed
in budget reconciliation, including robust funding of energy efficiency
tax incentives, 25C, 45L, and 179D, funding for Hope for Homes, and
robust funding for climate bank activity targeting energy efficiency
solutions in disadvantaged and tribal communities. And, we would also
urge hearings, and consideration of the Main Street Efficiency Act--
Alliance to Save Energy-led legislation that specifically targets
energy efficiency investments in small businesses. This legislation was
introduced by Congressman Peter Welch in the House, and Senator
Catherine Cortez-Masto in the Senate.
I thank you for the opportunity to provide testimony as part of
today's hearing. As we lead with energy efficiency, we add reliability
to our energy supplies, we increase national and energy security, we
help to ensure greater energy affordability, and we reduce carbon
emissions. It is worth repeating--that through energy efficiency alone,
we can reduce carbon emissions by 50% by 2050. And through energy
efficiency we can achieve 40% of the reductions required by the Paris
Climate Agreement. Thank you again for the opportunity, and I look
forward to your questions.
Ms. Castor. Thank you, Ms. Glover.
Mr. Johnson, you're recognized for 5 minutes to summarize
your testimony. Welcome.
STATEMENT OF DARNELL JOHNSON
Mr. Johnson. Good morning, Chair Castor, Ranking Member
Graves, and members of the House Select Committee. I am honored
to be invited to discuss the important role that buildings and
the building environment can play in reducing America's
contribution to the global crisis, climate crisis. Again, thank
you for inviting me to this discussion.
My name is Darnell Johnson. And I serve as the CEO and
President of Urban Efficiency Group, a utility implementation
contractor and community sustainable design firm. Our firm's
work systemizing sustainability has influenced how BIPOC
communities adopt energy efficiency and sustainability best
practices in how they engage in across community climate
collaborations.
As you may know, the building sector is responsible for 31
percent of the U.S. greenhouse gas emissions. And while
buildings are significant contributors to our climate crisis,
they can also be a key part to the solutions.
As the committee is focused on addressing the climate
crisis, I want to emphasize that all of my testimonies today
are all policies and practices that will advance energy
efficiency; will not only help save the planet by adjusting
climate change and decarbonization, but would also save the
people; as our decisions affect the lives of real humans, both
environmentally and economically. Therefore, we must ensure our
actions toward eliminating energy poverty are diverse,
equitable, and inclusive.
As we look at the stark disparities that exist in U.S.
energy burdens, both in urban and rural, low-income households,
spends substantially greater portions of their income on energy
costs compared to non low-income households.
Often those that fall between the gap of qualifying for
low-income energy efficiency programs and those that have the
financial bandwidth to leverage rebates and pay the upfront
costs associated with energy efficiency upgrades are left with
limited options and are often referred to as the working poor.
To bridge this growing gap, Congress should advance
policies aimed at helping low-income Americans make energy
efficiency upgrades to their home. That is the reason why I
strongly urge Congress to enact the bipartisan HOPE for HOMES.
And I want to thank Chairwoman Castor and Congressman
Casten on this committee for their cosponsorship to that. This
is important legislation that aims at helping all Americans by
providing homeowner's manager energy or savings for homes,
rebates for upgrading homes and doubling those rebates for
middle and lower-income Americans.
As we look at the economic benefits, the same built
environment that creates some of our challenges also creates
the opportunities for small business to work with development
opportunities. Energy efficiency was the largest employer and
the fastest growing sector in the energy industry before the
pandemic and can be again. But simply put, energy efficiency
equals jobs. It is crucial that we invest in our workforce. And
that means that we must ensure that contractors across the
country have equal access to job training. The hope training
portion in HOPE for HOMES that I mentioned earlier would
provide immediate hope, training, support to contractor
businesses, and help companies pay their contractors to
undertake training to educate them about a home's energy
structure and systems.
And as we begin to look at the equity within all of this,
the challenges of energy equity are also visible in the
disproportionate diverse makeup of the workforce and the
contractors. And so, we have to do more to prepare our diverse
workforce for quality jobs and energy efficiency and drive
further growth in this industry.
In conclusion, Madam Chair, members of the committee, I,
again, thank you for the opportunity to come before you and to
share in this important discussion.
One of the things that is really important is that the Blue
Collar to Green Collar Jobs Development Act of 2021 would
create a comprehensive program to improve education and
training for workers in the energy efficiency industry.
And so, the legislation would also give priority to the
businesses and other entities that recruit workers for local
communities, displaced energy sector workers, veterans,
minorities, and women, thereby creating more diverse, robust,
and inclusive workforce for the future.
And so, as I conclude, I ask that you consider the homes
that you and your constituents live in as part of the solution
to eliminate the crisis, the climate crisis. We can no longer
allow incrementalism to be the standard by which we measure
success when dealing with the complex issues of climate and
energy efficiency. We acknowledge the challenges regarding the
climate crisis are great, but our collective ability to find
the resolve is greater. Achieving energy equity is the outcome
of an intentional investment.
Thank you. I look forward to any questions that you may
have.
[The statement of Mr. Johnson follows:]
Testimony of Darnell Johnson
Vice Chair of the Building Performance Association, and CEO and
President of Urban Efficiency Group
Before the
U.S. House of Representatives, Select Committee on the Climate Crisis
At the Hearing on April 7, 2022:
``Cost-Saving Climate Solutions: Investing in Energy Efficiency to
Promote Energy Security and Cut Energy Bills''
Chair Castor, Ranking Member Graves, and members of the Committee,
my name is Darnell Johnson and I thank you for inviting me to testify
today on the important role that buildings can play in reducing
America's contribution to global climate change. As you may know, the
buildings sector is responsible for 31% of all U.S. greenhouse gas
emissions.\1\ While buildings are a significant contributor to our
climate crisis, they can also be a key part of the solution. My
testimony will focus in particular on how the residential sector is key
to carbon reductions and achieving numerous other benefits. In
addition, I am here because I believe that diversity brings strength,
inclusion is indicative of an acceptance that is essential to growth,
and equity is a human right that should be embraced as the standard and
not an exception. Energy efficiency policies must provide continuous
support for the diverse, equitable and inclusive expansion of workforce
development, which is indicative of meaningful policy reform.
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\1\ https://www.epa.gov/sites/production/files/2019-04/documents/
us-ghg-inventory-2019-main-text.pdf
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Policies aimed at retrofitting the over 115 million homes across
the country will not only help reduce carbon emissions from the
nation's residential building stock but will also help homeowners save
money on their monthly utility bills and improve the comfort, health,
safety, and resiliency of their homes. Advancing energy efficiency in
buildings across the U.S. will support climate change mitigation and
resilience, while also being an engine for job growth and economic
opportunity.
I am the CEO and President of Urban Efficiency Group, a utility
implementation contractor and community sustainability design firm
based in Chicago, IL and I have over two decades of entrepreneurial
experience and a fixation on advancing energy equity. My industry-
specific credentials include, but are not limited to, BPI-Building
Analyst, Building Envelope, Infiltration Duct Leakage, Energy Auditor,
Quality Control Inspector, Healthy Homes Evaluator, RESNET Rater, and
EcoDistrict Accredited Professional.
I am also proud to serve as the Vice-Chair of the Building
Performance Association (BPA), formerly known as the Home Performance
Coalition, a national non-profit 501c6 organization that works with
industry leaders in the home performance and weatherization industries
to advance energy-efficient, healthy and safe home retrofit policies,
programs and standards through research, education, training and
outreach. Additionally, I serve as Chair for the Diversity, Equity and
Inclusion (DEI) Committee to advance the organization's internal DEI
practices to influence the industry more broadly. I am pleased to
represent BPA here today.
Energy Efficient Buildings are a Pathway to Deep Decarbonization
As this committee is focused on addressing the climate crisis, I
want to emphasize that all I am testifying to today, all policies and
measures that will advance energy efficiency, will not only help
address climate change and are critical to achieving deep
decarbonization. Energy efficiency is not only cleaner and cheaper than
building new low-carbon or carbon-free generation, but by reducing the
need for energy and stretching out the work of every unit of energy, we
can reduce the overall need for more resources. Deploying energy
efficiency reduces demand for primary energy and generating capacity
needs and therefore lowers the overall costs of shifting to a low-
carbon energy system.\2\
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\2\ An NRDC study found that 80% emissions reductions in the U.S.
by 2050 is achievable and cost-effective using existing clean energy
technologies. Energy efficiency is the single greatest contributor to
emissions reductions in the model scenario which assumes an aggressive,
but technically and economically achievable, deployment of energy
efficiency across the U.S. economy. https://www.nrdc.org/sites/default/
files/americas-clean-energy-frontier-report.pdf
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Ultimately, the cleanest and cheapest energy is the energy you
don't use in the first place. A 2019 report from ACEEE found that
energy efficiency alone can cut energy use and greenhouse gas emissions
in half by 2050.\3\ Buildings deliver 33% of the total emissions
reductions in the report's model, and upgrades to existing buildings,
homes, appliances, and equipment are identified as some of the largest
cost-effective opportunities to achieve these reductions.
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\3\ https://aceee.org/sites/default/files/publications/
researchreports/u1907.pdf
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The residential buildings sector in particular remains a largely
untapped resource for carbon reduction goals. I will discuss specific
policy opportunities to address barriers and advance energy efficiency
in the residential sector in a moment. But first I would like to give
you some examples of how energy efficiency can benefit the workforce
and the homeowner in ways that can positively impact the lives of
Americans.
It is our firm's experience, working in 13 ``Chicagoland''
communities covering both South and West Suburban Cook County, and 5
communities in Northwest Indiana for more than a decade and delivering
energy efficiency retrofit services to more than 6,000 low-income
homes, that many (Black, Indigenous, People Of Color) BIPOC and low-
income communities are severely underserved by energy efficiency
programs. We have observed that there are three primary drivers that
sustain this inequity: awareness, access, and affordability. While
utility and WAP income qualified programs attempt to address the
affordability barrier, awareness and access remain the existential
threats to program participation. Failure to incorporate inclusive
processes that enlist the input of diverse thought leaders and
organizations from within the target communities, perpetuates the use
of misguided communication and marketing strategies. In order to
connect with hard-to-reach populations, we must first listen to them.
To do otherwise stymies information sharing and limits participant
enrollment in energy efficiency programs and exacerbates the divide
between those who are participating in the fight to address climate
change, and those forced to remain on the sidelines.
Energy Burdens and Energy Efficiency
The reduced energy burden resulting from energy efficiency upgrades
to the residential stakeholder, in general, and to the low-income
residential stakeholder, specifically, cannot be understated. According
to a report published by ACEEE, low-income households spend 8.1% of
their income on energy costs, on average, in comparison to 2.3% for
non-low-income households \4\. However only 17% of homes receiving
energy efficient upgrades are identified as low-income. This high
energy burden correlates even more strongly with race. Nationally,
Black households spend 43% more of their income on energy costs than
their white, non-Latinx counterparts; Latinx households spend 20% more;
and Native American households spend 45% more.\5\ It is critical that a
new approach that incorporates procedural justice is used that focuses
its results on increasing low-income participation and reducing both
carbon emissions and energy burdens.
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\4\ Report: Low-Income Households, Communities of Color Face High
``Energy Burden'' Entering Recession | ACEEE
\5\ u2006.pdf (aceee.org)
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Energy Burdens Matter
As we consider the adverse impacts of energy burdens on our
country's most vulnerable populations, the need for energy equity
advocacy becomes clear. We believe those that are closest to the
problems are also closest to the solutions. As a practitioner and
diversity thought leader, it is important that I provide accurate
accounts of the social fatigue resulting from the energy inequity
that's disproportionately affecting BIPOC and low-income communities.
Admittedly, it is not enough for me to share the accounts with our
congressional leaders, but rather to be the impetus of innovative ideas
that will influence policy and resource allocation going forward.
Energy Efficiency Policy as a part of Health and Equity Policy
As I showed in my example, energy efficiency is a key strategy for
not only reducing carbon emissions but also for improving the lives of
Americans. Legislation that advances energy efficiency in buildings,
especially residential buildings, provides many benefits in addition to
energy and pollution reductions including increased comfort, health,
and energy affordability.
The occupants of the vast majority of homes in the U.S. experience
building-related comfort problems, health issues, and/or high utility
bills--problems which could all be significantly mitigated by proper
construction techniques and energy efficiency upgrades. Studies have
shown that improvements in occupant health from residential energy
efficiency are strongest among vulnerable groups: lower income
households and residents with pre-existing health conditions linked to
housing risks.\6\
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\6\ https://e4thefuture.org/wp-content/uploads/2016/11/Occupant-
Health-Benefits-Residential-EE.pdf
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Energy costs are a significant living expense. Even before the
pandemic, the nearly one-third of U.S. households who face challenges
paying energy bills or sustaining adequate heating and cooling in their
homes, the cost savings provided by energy efficiency are critical \7\.
A study released last year by the Roosevelt Institute and Evergreen
Action aptly called ``Economic Recovery Begins at Home \8\ provides a
policy prescription for creating jobs and protecting the climate while
focusing on equity. I encourage you to consider it.
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\7\ https://www.eia.gov/todayinenergy/detail.php?id=37072
\8\ https://rooseveltinstitute.org/wp-
content/uploads/2021/03/RI_EconomicRecoveryBeginsatHome_3Pager_202103-
1.pdf
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Congress should advance policies aimed at helping middle income
Americans make efficiency upgrades to their homes. This is why I
strongly urge Congress to enact the bi-partisan, HOPE for HOMES Act
(H.R. 3456). And, I want to thank Chairwoman Castor and Congressman
Casten on this committee for their co-sponsorship. This important
legislation aims to help ALL Americans by providing Home Owners Manage
Energy Savings (HOMES) rebates for upgrading homes and doubling those
rebates for middle and lower income Americans. These rebates target the
actual energy performance of a home--so Congress is paying for the real
energy savings resulting from those retrofits, investing in America's
homes and the people who live in them. You have done your part by
including significant portions of this legislation in Build Back
Better, but as you know, the job is not done yet and I encourage you to
continue to fight to pass H.R. 3456.
In addition to the cost-savings benefits to homeowners, efficiency
upgrades also have health and safety benefits. A U.S. Department of
Energy report on the Weatherization Assistance Program found that home
improvements focused on energy efficiency can improve indoor air
quality, which reduces respiratory illness and sick days, and reduce
thermal stress caused by exposure to extreme indoor thermal conditions
(temperature, humidity, drafts).\9\ A report from E4TheFuture, entitled
``Occupant Health Benefits of Residential Energy Efficiency'' \10\
which reviews existing research on the link between resident health
benefits and energy efficiency upgrades, also found that residential
energy efficiency upgrades can produce significant improvements in
asthma symptoms and help improve overall physical and mental health.
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\9\ https://weatherization.ornl.gov/wp-
content/uploads/pdf/WAPRetroEvalFinalReports/ORNL_TM-2014_345.pdf
\10\ https://e4thefuture.org/occupant-health-benefits-of-
residential-energy-efficiency/
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While Congress passed the reauthorization and expansion of the
Weatherization Assistance Program (WAP) in 2020, and then provided
additional support in the bi-partisan infrastructure bill in 2021, it
is critical that Congress continue to support and expand the WAP. One
of the key issues we see are contractors not weatherizing homes because
there are barriers--such as mold, asbestos, rodent concerns--that need
to be addressed first, before energy efficiency measures can be put in
place. I know there are members in the House and Senate looking to
allow the Weatherization program flexibility to address these barriers
so that unhealthy homes are not left untreated.
I implore the committee to remember that there can be no climate
policy without taking into account equity. Walking away from upgrading
the efficiency of a home, moving onto another because that home is not
healthy, is not seeing climate through an equity lens.
Energy Efficiency Through an Equity Lens
By definition equity means to be fair, and it is with this in mind
that I would like to establish a premise to bring the equity lens into
focus regarding the energy efficiency industry. Energy efficiency as we
know it began in the mid-1970's with the OPEC oil crisis, around the
same time the US was wrestling with the social policy exhaustion
stemming from the Civil Rights movement of the 50's and 60's. It was
during this paradigm shift that white men established themselves as the
dominant force that would drive the energy efficiency industry forward
while people of color were inundated with fighting for basic human
rights.
To fault the historical trailblazers for their contribution in
establishing and advancing energy efficiency would be a misplacement of
blame. However, to resist systemic change that supports diversity and
equitable access to this emerging market is disempowering. To make this
point more salient, I would like to introduce the Social Equity Theory
of Change \11\. This theory of change suggests that in order to achieve
greater equity the following must be considered:
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\11\ This concept is consistent with the Racial Equity Theory of
Change while the Social Equity Theory of Change goes beyond race and
racism and addresses the systemic social barriers that deal with
inclusion, diversity and equity. https://www.aspeninstitute.org/wp-
content/uploads/files/content/docs/rcc/
RACIAL_EQUITY_THEORY_OF_CHANGE_08.PDF
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1. Self--Address the unconscious and implicit biases that
shape our opinions and influence how we process the surface
level diversity that we see in other social identity groups.
2. Systems--Organizations, companies, and governments are run
by people, but if the people that run these entities lack the
ability to be equitable, so will the practices, policies, and
opportunities that they develop and deploy.
3. Society--Ultimately the end-users, which is society in
general, and low-income communities specifically, will
experience an inequitable allocation of resources and
opportunities.
By sharing and urging consideration of these unconventional, and
perhaps uncomfortable, concepts with this committee, I hope to humanize
the challenges associated with the climate crisis and energy burden and
help you build a policy path that includes equity and job creation
while decarbonizing the U.S. economy.
Energy Efficiency Creates Jobs
As soon as the nation began shutting down in response to the global
pandemic, America's energy efficiency workforce began to dissolve. A
report from E2 \12\ found that, over the course of 2020, the energy
efficiency sector shed a net of nearly 272,000 jobs, an 11% decline
that wiped out the consistent job gains from the three years before.
The small businesses that make up the residential energy efficiency
sector were particularly hard hit by the crisis, as residential
contractors conduct most of their work via physical visits to homes.
Many homeowners and renters still remain hesitant to invite contractors
indoors, and it is vital that we support these contractor companies as
they rebuild their businesses.
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\12\ https://e2.org/wp-content/uploads/2021/04/E2-2021-Clean-Jobs-
America-Report-04-19-2021.pdf
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Now is the time to help these small businesses rehire and prepare
for a new stage of significant advancement of America's existing home
infrastructure. It is crucial that we invest in our workforce and that
means that we must ensure that contractors across the country have
equal access to job training.
The HOPE Training portion in HOPE for HOMES (H.R. 3456) that I
mentioned earlier would provide immediate ``HOPE'' training support to
contractor businesses and help companies pay their contractors to
undertake training and educate them about a home's energy structure and
systems. While the Build Back Better language is briefer, I urge you to
review the needed details in H.R. 3456 where HOPE training provides
needed stipends for contractors. These stipends will also support
individuals who have changed careers during the pandemic or due to
changes in the economy. Because this training also allows for and
encourages online training--which has evolved and improved
significantly during the crisis--contractors from all states would have
access to these courses and would be able to invest in workforce
development.
To address climate change, America's homes must use energy more
efficiently. As I noted, I am the Vice-Chair of the Building
Performance Association which stands ready to support contractors in
connecting them to job training and employment resources. BPA is
committed to helping build an energy efficiency workforce to meet the
demand of the climate crisis.
Energy efficiency was the largest employer and fastest growing
sector in the energy industry before the pandemic and can be again. Put
simply, energy efficiency equals jobs. According to the 2021 Energy
Efficiency Jobs in America \13\ report released by E4TheFuture, the
energy efficiency sector employs over 2.1 million Americans, more than
twice as many workers as the entire U.S. fossil fuel industry. In the
first half of 2021, the industry added more than 8,000 jobs nationwide,
bouncing back from massive layoffs stemming from the COVID-19 pandemic.
Still, employment remains well below pre-pandemic total job numbers due
to challenges related to workforce, construction, and supply chains.
Importantly, these are well-paying and sustainable jobs. Entry level
wages in all sectors of energy efficiency jobs exceed the national
average and approximately 80% of employers in the industry provide
healthcare and retirement account contributions.\14\ These local,
family-sustaining jobs exist all across the country; 99.8% of U.S.
counties have energy efficiency jobs and more than 280,000 of these
jobs are in rural areas.\15\ A significant portion of the energy
efficiency jobs in the U.S. are in the residential sector, and 54
percent of energy efficiency jobs involve construction and repairs.\16\
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\13\ https://e4thefuture.org/wp-content/uploads/2021/10/Energy-
Efficiency-Jobs_2021_All-States.pdf
\14\ https://e4thefuture.org/wp-content/uploads/2021/10/Energy-
Efficiency-Jobs_2021_All-States.pdf
\15\ Ibid; https://e2.org/wp-content/uploads/2021/04/E2-2021-Clean-
Jobs-America-Report-04-19-2021.pdf
\16\ https://e4thefuture.org/wp-content/uploads/2021/10/Energy-
Efficiency-Jobs_2021_All-States.pdf
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These are the contractors--the ``boots on the ground''--installing
energy efficiency products and technologies and working to reduce
energy waste in homes and commercial buildings across the country.
These jobs are, by their very nature, inherently local and cannot be
exported. Contractors are local--their kids go to the same schools as
their clients, they sponsor baseball teams, they share in community
successes and failures. Policies that encourage investment in energy
efficiency can further advance growth in this industry, creating even
more well-paying jobs all across America and generating economic
opportunity through the decarbonization transition.
Importantly, policies that provide incentives for building
efficiency retrofits, such as the HOMES act or tax policy like the 25C
federal credits, create a ripple effect on jobs. Demand for insulation,
air sealing, HVAC will certainly create work for those who install
these products, but it also creates jobs in the manufacturing and
distribution of those products. This creates jobs around those
industrial centers where workers eat, shop, and live.
Not only can energy efficiency be the largest employer in the
energy sector, it has the most potential for even more job growth
moving forward. With an aging building stock across the country, we
have only scratched the surface on the investment potential for energy
efficiency improvements. Addressing barriers to retrofitting these
existing homes and buildings and advancing energy efficiency across the
entire buildings sector will simultaneously support decarbonization and
job creation.
It is also important to note that the energy efficiency industry is
made up of small businesses: 90% of energy efficiency businesses in
America have fewer than 100 employees.\17\ These small businesses are
the heart of the American economy--creating jobs, driving growth, and
saving us all money through improved energy efficiency. They are also
the ones that are in need of assistance when it comes to ensuring that
there are qualified workers to fill these jobs. Small energy efficiency
businesses need resources to help train new hires and provide ongoing
education to existing employees, keeping them up to date on
certifications and trained in the latest technologies and health and
safety practices.
---------------------------------------------------------------------------
\17\ Ibid.
---------------------------------------------------------------------------
To prepare more American workers for quality jobs in energy
efficiency and drive further growth in this industry, Congress should
act to support workforce development and jobs training. The Blue Collar
and Green Collar Jobs Development Act of 2021 would create a
comprehensive program to improve education and training for workers in
the energy efficiency industry, including manufacturing, engineering,
construction, and building retrofitting jobs. This legislation will
result in more American workers who are equipped to provide energy
efficiency products and services and whose work will reduce energy
waste and save money for homes and businesses across the country. The
legislation would also give priority to businesses and other entities
that recruit workers from local communities, displaced energy sector
workers, veterans, minorities, and women, thereby creating a more
diverse, robust, and inclusive workforce of the future. This important
legislation continues to evolve, and I want to encourage the members of
the committee to work with Chairman Rush to move this legislation
through Congress and to the President's desk.
Energy Efficiency and Sound Economic Policy--The Small Business Story
Energy Efficiency provides a career path that pays a living wage,
but is also a gateway to small business ownership. Yet the cost
associated with training, equipment, certifications, and the access to
a qualified workforce are barriers to entry. Our firm developed a
quasi-small business incubator (Energy+) to remove the barriers
mentioned and increase supplier diversity. This comprehensive approach
to developing and deploying more minority business enterprise (MBE)
firms in the energy efficiency space, or ``business in a box'' concept
was successful in launching two (2) minority owned energy efficiency
contracting firms that boast a six-figure net profit year over year.
With greater investments in legislation like the Blue Collar to Green
Collar Jobs Development Act of 2021 and the HOPE for HOMES Act of 2021
we can increase the contractor diversity in the energy efficiency
sector and experience a more diverse workforce.
Small business and micro-business in BIPOC communities
The Energy+ initiative provides an end-to-end experience to ensure
success and sustainability of a new energy efficiency firm. This
experience includes, but is not limited to, MBE candidate recruitment
and screening, small business development training, BPI certification
training, connection to a broader network of support, connection to
systems support, access to capital, access to contracts, MBE
certification support, and capital purchase support. Additionally, this
initiative empowers local MBE service providers the opportunity to
create and expand local workforce and small business opportunities,
while delivering healthy home and energy assessments and home retrofit
services to households at or below 80% of Area Median Income. Despite
the many barriers that entrepreneurs of color face, BIPOC businesses
comprise a significant portion of our economy and often act as the
economic lifeblood of their communities. Yet, despite the growth of
BIPOC small businesses, there is still a disparity when it comes to
access to capital, contracting opportunities and other entrepreneurial
development opportunities for minority-owned firms \18\.
---------------------------------------------------------------------------
\18\ https://www.sbc.senate.gov/public/index.cfm/
minorityentrepreneurs
---------------------------------------------------------------------------
The disproportionately low number of minorities with jobs in the
energy efficiency field is symptomatic of a lack of MBEs working in the
space. The lack of qualified MBEs is symptomatic of difficulties any
firm faces when entering the relatively small and closed community--the
clean energy community may be small, but it is growing. It needs to
also grow in inclusivity. MBEs also face barriers associated with
limited financial capacity, access to capital, access to clients, and
challenges attracting workers in a closed business community. As we
invest in addressing climate change, we must invest in a broad and
inclusive vision of the green, American jobs that retrofit America.
Conclusion
In conclusion, Madam Chair, members of the committee, I again thank
you for this opportunity to come before you and share my story and ask
you to consider the homes you and your constituents live in as a part
of the solution to the climate crisis. The built environment is one of
the largest consumers of energy and thus emitters of greenhouse gas
emissions. But we cannot address climate change without being mindful
of the impact those policies have on communities of color and low-
income households. Please know that we can address all these concerns
simultaneously and fundamentally change the relationship people have
with their energy use while improving the lives of families and
increasing good, green, jobs.
With policy and program innovation that brings all of these pieces
together to optimize energy usage we can reduce the need for new power
plants, deliver more reliable energy services at lower costs, all while
making homes healthier, more comfortable places to live.
Ms. Castor. Thank you, Mr. Johnson.
Mr. Schryver, you are up. Welcome. You are recognized for 5
minutes to summarize your testimony.
STATEMENT OF DAVE SCHRYVER
Mr. Schryver. Thank you. Good morning, Chairwoman Castor,
Ranking Member Graves, and members of the committee. My name is
Dave Schryver. And I am the President and CEO of the American
Public Gas Association. I am honored to appear today on behalf
of the approximately 1,000 communities across the United States
that own and operate their retail natural gas distribution
systems. APGA's members are not-for-profit gas distribution
systems owned by cities and other local government entities.
The primary mission of a public gas system is delivering
affordable energy. Our members have no obligation to deliver a
profit to shareholders. Instead, local officials are
responsible for setting rates with the goal of delivering
energy to their community as safely and affordably as possible.
That mission has become even more vital as Americans are
struggling with the burden of high prices at the gas pump and
rising inflation.
Natural gas has not been immune to price increases in
recent years, but data from the Energy Information
Administration continues to show that it remains the most
affordable fuel source to heat your home in the winter. Homes
fueled by natural gas consume less energy than electric homes
when you consider the full fuel cycle from source to site,
because almost two-thirds of the energy involved in delivering
electricity is used or lost before it ever reaches the point of
end use. In contrast, less than 10 percent of the natural gas
is lost between the point of production and the residents,
making direct use of natural gas almost three times more
efficient than electricity.
It is estimated that the average home that uses natural gas
appliances for heating, cooking, and clothes drying saves over
$1,000 a year compared to homes using electric appliances.
Emissions reduction efforts also play a critical role in public
gas systems' ability to deliver energy affordably. Leaks are
not just bad for the environment, they are also bad for
business.
APGA members have dedicated significant resources to
upgrading their pipeline infrastructure and investing in leak
detection technology to decrease the amount of gas lost. Those
efforts are good for the environment, but also ultimately
reduce our members' operating costs and deliver savings to
consumers.
APGA's members are also committed to helping their
customers reduce their energy usage. Most offer weatherization
assistance and appliance rebate programs to help their
customers reduce their demand for energy and lower their bills.
Natural gas is not only more affordable than electricity,
but also more reliable due to the inherently secure nature of
the underground pipeline network that is used to deliver it,
which is less vulnerable to extreme weather than electric
transmission lines. Only one in 800 natural gas customers
experiences an unplanned outage in a given year, compared to
electric customers, who experience an average of at least one
outage every year.
Even though we know natural gas is the most affordable and
reliable way to fuel a home, public gas systems are still
facing challenges. Some of our members have wait lists for
would-be customers who cannot be connected due to a lack of
pipeline capacity. This is a direct result of how difficult it
has become to permit new natural gas infrastructure to supply
gas to everyone who wants it. In colder climates, this often
means continued reliance on propane or heating oil, which leads
to higher energy bills and a greater environmental footprint.
We are also facing proposed bans on new natural gas
hookups, building code changes at the local level to
disincentivize the use of gas appliances. These bans are being
proposed even though residential natural gas use accounts for
only 4 percent of the emissions in the United States. Not only
does this take away a consumer's right to choose the energy
source that fuels their home, these efforts will also lead to
higher costs for American families while producing little
environmental benefit.
If politicians force fuel switching on natural gas
customers, those households will not only face higher energy
bills, but will also have to shoulder the cost of expensive new
appliances. Last year, the Consumer Energy Alliance considered
what it would cost if the nearly 60 million American households
who rely on natural gas were forced to switch their furnaces,
water heaters, stoves, and clothes dryers to run on
electricity. Their research estimated a nationwide cost to
consumers of more than $258 billion. Those costs are just for
the appliances themselves and do not account for the electric
service panel upgrades needed to support the additional load of
converting all their appliances to run on electricity.
One recent study estimated that that could result in an
additional $100 billion cost nationwide. APGA understands the
need to transition to a clean energy future, but we urge
Congress not to discount the role that natural gas can play.
Natural gas has been delivering emission reductions in the
energy sector for decades. But the development of renewable and
natural gas and the potential of hydrogen, the gas industry can
continue to deliver clean energy for American families in the
future.
Congress should pursue an all-of-the-above energy policy
that continues to invest in energy efficient, gas-fired
appliances and the infrastructure needed to support their
continued use if we are going to transition to a clean energy
future without compromising reliability and imposing
unnecessary burdens on consumers.
I thank the committee for the opportunity to testify on
this important topic. And I look forward to today's discussion.
[The statement of Mr. Schryver follows:]
Written Testimony of Mr. Dave Schryver
President and CEO, American Public Gas Association
Before the House Select Committee on the Climate Crisis
Hearing on ``Cost-Saving Climate Solutions: Investing in Energy
Efficiency to Promote Energy Security and Cut Energy Bills''
April 7, 2022
Good morning, Chairwoman Castor, Ranking Member Graves, and members
of the Committee. My name is Dave Schryver, and I am the President and
CEO of the American Public Gas Association. Thank you for this
opportunity to testify before the Committee.
I am honored to appear today on behalf of the approximately 1,000
communities across the United States that own and operate their retail
natural gas distribution entities. APGA's members include not-for-
profit gas distribution systems owned by municipalities and other local
government entities, all directly accountable to the citizens they
serve.
Prioritizing Affordability
The primary mission of a public gas system is delivering affordable
energy. Our members have no obligation to deliver a profit to
shareholders. Instead, local officials are responsible for setting
rates with the goal of delivering energy to their community as safely
and affordably as possible. That mission has become even more vital as
Americans are struggling with the burden of high prices at the gas pump
and rising inflation.
Natural gas has not been immune to price increases in recent years,
but data from the Energy Information Administration continues to show
that it remains the most affordable fuel source to heat your home in
the winter.\1\ The low price of gas as a commodity is not the only
factor at play here.
---------------------------------------------------------------------------
\1\ ``Winter Fuels Outlook,'' U.S. Energy Information
Administration, October 2021, available at: https://www.eia.gov/
special/heatingfuels/resources/winterfuels2021.pdf.
---------------------------------------------------------------------------
Homes fueled by natural gas also have the advantage of consuming
less energy than electric homes when you consider the full fuel cycle
from source to site. To deliver electricity to homes and businesses,
almost two-thirds of the energy involved is used or lost before it ever
reaches the point of end use. In contrast, when natural gas is being
burned as the direct source of energy, less than ten percent is lost
between the point of production and the residence, making direct use of
natural gas almost three times more efficient. As a result, it is
estimated that the average home that uses natural gas appliances for
heating, cooking, and clothes drying saves over $1,000 a year on their
energy bills compared to homes using electric appliances for those
purposes.\2\
---------------------------------------------------------------------------
\2\ ``A Comparison of Energy Use, Operating Costs, and Carbon
Dioxide Emissions of Home Appliances 2021 Update,'' EA 2021-04,
American Gas Association, October 1, 2021, available at: https://
www.aga.org/globalassets/research_insights/reports/ea-2021-04-
appliance-cost-and-emissions-comparison-2021.pdf.
---------------------------------------------------------------------------
Emissions reduction efforts also play a critical role in public gas
systems' ability to deliver energy affordably. Leaks are not just bad
for the environment; they are also bad for business. APGA members have
dedicated significant resources to upgrading their pipeline
infrastructure by repairing or replacing leak prone pipe in their
systems to decrease the amount of gas lost. They are also investing in
leak detection technology that allows them to more accurately monitor
their systems to identify and stop leaks. These efforts are good for
the environment, but also ultimately reduce our members' operating
costs and allow them to deliver savings to their customers.
Delivering affordable energy is not just about low rates. APGA
members are also committed to helping their customers reduce their
energy usage. Most offer weatherization assistance and appliance rebate
programs to help their customers take advantage of all available
resources to reduce their demand for energy and lower their energy
bills.
A Proven Reliability Track Record
Natural gas is not only more affordable than electricity, but also
more reliable. Only 1 in 800 natural gas customers experiences an
unplanned outage in a given year. In comparison, electric customers
experience an average of at least one outage every year.\3\
---------------------------------------------------------------------------
\3\ ``Assessment of Natural Gas and Electric Distribution Service
Reliability,'' Gas Technology Institute, July 19, 2018, available at:
https://www.gti.energy/wp-
content/uploads/2018/11/Assessment-of-Natural-Gas-Electric-
Distribution-Service-Reliability-TopicalReport-Jul2018.pdf.
---------------------------------------------------------------------------
This is due to the inherently secure nature of the underground
pipeline network that is used to deliver it. Pipes buried underground
are much less vulnerable to extreme weather than electric transmission
lines. During recent extreme weather events like Winter Storm Uri,
which had devastating consequences for many families that were without
electricity for days, gas utilities were able to continue delivering
energy to their customers.
The Gas Industry Is Confronting Significant Challenges
Even though we know natural gas is the most affordable and reliable
way to fuel a home, public gas systems are still facing significant
challenges. Some of our members, particularly those in the Northeast,
have waitlists for would-be customers who want to receive gas service
or add lines for additional appliances, but they are unable to do so
due to lack of capacity. This is a direct result of how difficult it
has become to permit new natural gas infrastructure. There are simply
not enough pipelines to supply gas to everyone who wants it.
Unfortunately, in colder climates, this often means households continue
to rely on propane or heating oil to stay warm in the winter. This not
only produces a greater environmental footprint, but also forces those
customers to continue paying higher energy bills.
Other public gas systems are confronting challenges from local
officials who want to ban new natural gas hookups or change building
codes in their cities and counties to disincentivize the use of gas
appliances in homes and businesses. These bans are being proposed in
spite of the fact that residential natural gas use accounts for only 4%
of emissions in the United States.\4\ Not only does this take away a
consumer's right to choose the energy source that fuels their home, if
successful, these efforts will inevitably lead to higher costs for
American families while producing little environmental benefit.
---------------------------------------------------------------------------
\4\ ``Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-
2019,'' Environmental Protection Agency, April 14, 2021, available at:
https://www.epa.gov/sites/default/files/2021-
04/documents/us-ghg-inventory-2021-main-text.pdf.
---------------------------------------------------------------------------
The Cost of Forced Electrification
If politicians force fuel switching on natural gas customers, those
households will not only face higher energy bills, but will also have
to shoulder the additional cost of expensive new appliances and
potential electrical system upgrades to support them.
Last year, the Consumer Energy Alliance considered what it would
cost if the nearly 60 million American households who rely on natural
gas for cooking, cleaning, or heating their homes were forced to switch
to electric appliances. Their research found:
A new electric furnace and installation costs an
estimated $2,500,
A new water heater costs an average of $1,180,
A new, low-end electric range costs an estimated
$767, and
A new electric clothes dryer costs an average of
$749.
The nationwide cost to consumers if we forced natural gas
households to switch to electric appliances would come in at more than
$258 billion.\5\
---------------------------------------------------------------------------
\5\ ``Green New Deal Would Cost American Consumers More Than $258
Billion--in JUST Four Appliances,'' Consumer Energy Alliance, April 20,
2021, available at: https://consumerenergyalliance.org/2021/04/green-
new-deal-would-cost-american-consumers-more-than-258-billion-in-just-
four-appliances/.
---------------------------------------------------------------------------
These costs are just for the appliances themselves and do not
account for the fact that many homes that currently rely on natural gas
appliances would also be forced to upgrade their electric service
panels to support the additional load of converting all their
appliances to run on electricity. One recent study estimated that as
many as 48 million households may require such an upgrade to fully
electrify.\6\ Assuming an average cost of $2,000 for an electric panel
upgrade, we are looking at an additional $100 billion cost
nationwide.\7\
---------------------------------------------------------------------------
\6\ ``Addressing an Electrification Roadblock: Residential Electric
Panel Capacity: Analysis and Policy Recommendations on Electric Panel
Sizing,'' Pecan Street, August 2021, available at: https://
www.pecanstreet.org/panel-size-paper-update/.
\7\ Id.
---------------------------------------------------------------------------
The Clean Energy Future
We at APGA understand the need to transition to a clean energy
future, but we urge Congress not to discount the role natural gas can
play in that future. Natural gas has been delivering emission
reductions in the energy sector for decades. With the development of
the renewable natural gas industry and the potential of hydrogen, the
gas industry can continue to deliver clean energy for American families
in the future, utilizing our existing infrastructure and skilled
workforce.
It is vital that Congress pursue an all-of-the-above energy policy
that continues to invest in and support energy efficient, gas-fired
appliances and the infrastructure needed to support their continued use
if we are going to transition to a clean energy future without
compromising the reliability of our energy system and imposing
unnecessary financial burdens on consumers.
I thank the Committee for the opportunity to testify on this
important topic, and I look forward to today's discussion.
Ms. Castor. Thank you.
Next, Ms. Baldwin. Welcome. You are recognized 5 minutes to
present your testimony.
STATEMENT OF SARA BALDWIN
Ms. Baldwin. Good morning. Good morning, Chair Castor,
Ranking Member Graves, and Select Committee members. Thank you
so much for the opportunity to be here this morning.
I work for Energy Innovation, which is a nonpartisan energy
and climate policy think tank. We provide research and analysis
to support policy design that reduces emissions at speed and
scale, required for a stable climate. Our work is data-driven
and informed by climate science.
The IPCC report released this week made clear that actions
are needed within this decade. And they will determine our
collective climate future. Ignoring the urgent call to act will
result in locked-in emissions, stranded assets, nonviable
investments, and costly climate change.
The same IPCC report, as well as a recent International
Energy Agency report, points to widespread electrification of
more end-uses, buildings, vehicles, and some industries as a
way to achieve net zero emissions by 2050.
Electrification refers to switching end uses that currently
run on fossil fuels to run on carbon-free electricity. For
example, by replacing an older inefficient gas furnace with a
more energy efficient, all-electric heat pump.
The high prices for oil and gas are front of mind right
now, but it is important to keep in mind that they are the
result of issues on both the supply side, and the demand side.
Reducing the demand for fossil fuels protects customers by
putting a dampening effect on the high and volatile prices.
Electrification reduces demand for fossil fuels and today's
all electric technologies are far more efficient than their
fossil counterparts. For example, air source heat pumps to heat
your home are two to four times more energy efficient than
natural gas-burning furnaces. Induction stoves outperform gas
stoves by 3-to-1, without emitting harmful indoor air
pollution. And EVs are nearly four times as efficient compared
to gas or diesel vehicles also with pollution benefits to
communities and individuals.
Electric technologies are also cheaper to operate. And
electricity is a more price-stable commodity, which insulates
consumers from price shocks. A March 2022 analysis shows EVs
are 3-to-6 times cheaper to drive per mile than gas powered
vehicles. Another analysis shows that if all new vehicle sales
were all electric in 2035, that would yield $2.7 trillion in
consumer savings by 2050.
Electricity is generated from a diverse set of homegrown
resources. And electric utilities and the grid are highly
regulated to ensure affordable and reliable electricity for all
end users. Modeling from Energy Innovation shows that
electrification combined with a clean carbon-free grid is the
most cost-effective pathway to drive down greenhouse gas
emissions to net zero by 2050, while also creating jobs and
improving public health. Our modeling shows that strong
policies would, by 2050, increase gross domestic product by
$920 billion, create more than 5 million new job years, avoid
more than 45,000 premature deaths, and 1.3 million asthma
attacks annually.
We already have the technologies we need to start
electrifying more end uses. And we don't have to wait for a
breakthrough or an unproven costly alternative to be viable.
However, ensuring a wide range of available models and
products, and a trained workforce to support widespread
electrification in an equitable manner, requires policy to
remove barriers, uptake, and enable mainstream adoption.
Equitable incentives for EVs and electric appliances, such
as those passed by the House last year, would be market game
changers, and ideally, would be integrated into any future
reconciliation package.
Well-designed incentives provisions, such as caps based on
income, and cost per vehicle, used EV incentives, and higher
incentives for electric equipment in households that are
underserved and communities that are front-line will ensure
more Americans can access and benefit from these technologies
sooner.
Although I have not touched on it in detail today, more
support is needed for industrial electrification. The U.S.
industrial sector contributes nearly a quarter of our
greenhouse gas emissions, yet few policies focus on this
sector. Industrial operations are an untapped opportunity for
greater price stability for made-in-America commodities by
shifting more processes to run on carbon-free electricity.
Policies to boost domestic manufacturing and production of
the minerals and materials needed for electric and clean
technologies will improve America's competitiveness, and make
our economy more insulated from supply chain disruptions.
The recent invocation of the Defense Production Act for
critical minerals and some provisions in the Infrastructure Act
are important first steps, but more incentives and funding
would help move the dial.
In conclusion, the urgency of our climate crisis, combined
with the inherent price volatility of oil and gas, requires
that we work quickly to electrify as many end uses as possible.
Although 2050 may seem like a far-away day, policy adoption and
implementation take time, as does the necessary capital stock
turnover to convert existing fossil fuel assets to carbon-free
assets.
We must start now. Electrification is a viable solution
that reduces harmful air pollution, creates American jobs,
saves consumers money, and offers a cost-effective pathway to
decarbonize our economy, but we need Federal leadership and
smart policies to electrify the movement.
Thank you for your time and I look forward to questions.
[The statement of Ms. Baldwin follows:]
Testimony of
Sara Baldwin
Director, Electrification Policy
Energy Innovation
U.S. House of Representatives Select Committee on the Climate Crisis
``Cost-Saving Climate Solutions: Investing in Energy Efficiency
to Promote Energy Security and Cut Energy Bills''
April 7, 2022
Good morning, Chair Castor, Ranking Member Graves, and Select
Committee Members. Thank you for the opportunity to be speak with you
all today, and it's an honor to be here. I appreciate the work of this
committee, and the leadership each of you has shown in your public
service, to understand climate science and work collaboratively to
generate policy solutions.
I am the Director of Electrification Policy with Energy Innovation,
a non-partisan climate policy think tank providing research and
analysis to support policies that reduce emissions at the speed and
scale required for a safe climate future. Our work is based on
scientific assessments of climate change, and our policy
recommendations are grounded in data, driven by our open-source and
peer-reviewed Energy Policy Simulator model.\1\
I have devoted my 18-year career to advancing workable solutions to
climate change because it is the one issue that truly impacts
everything, and I believe it is one of the most important issues of our
time. The two most recent contributions to the Intergovernmental Panel
on Climate Change (IPCC) Sixth Assessment Report (from Working Groups
II and III) are sobering; both make painstakingly clear that our time
to limit warming is perilously short, and the societal choices and
actions taken within the next decade will determine our collective
climate future.\2\ The Working Group III report, issued this week,
notes that limiting warming to around 1.5 degrees Celsius requires that
global greenhouse gases must peak before 2025 at the latest, and be
reduced by 43 percent by 2030; at the same time, methane would also
need to be reduced by about a third.\3\ Fixing the ``pervasive leaky
natural gas infrastructure'' \4\ is paramount to minimizing methane's
damage within the decade.
---------------------------------------------------------------------------
\1\ Available at: https://energypolicy.solutions/.
\2\ IPCC, 2022: Summary for Policymakers [H.-O. Portner, D.C.
Roberts, E.S. Poloczanska, K. Mintenbeck, M. Tignor, A. Alegria, M.
Craig, S. Langsdorf, S. Loschke, V. Moller, A. Okem (eds.)]. In:
Climate Change 2022: Impacts, Adaptation, and Vulnerability.
Contribution of Working Group II to the Sixth Assessment Report of the
Intergovernmental Panel on Climate Change [H.-O. Portner, D.C. Roberts,
M. Tignor, E.S. Poloczanska, K. Mintenbeck, A. Alegria, M. Craig, S.
Langsdorf, S. Loschke, V. Moller, A. Okem, B. Rama (eds.)]. Cambridge
University Press. In Press. Available at: https://www.ipcc.ch/report/
ar6/wg2/downloads/report/IPCC_AR6_WGII_
---------------------------------------------------------------------------
SummaryForPolicymakers.pdf and IPCC, 2022: Summary for Policymakers.
In: Climate Change 2022: Mitigation of Climate Change. Contribution of
Working Group III to the Sixth Assessment Report of the
Intergovernmental Panel on Climate Change [P.R. Shukla, J. Skea, R.
Slade, A. Al Khourdajie, R. van Diemen, D. McCollum, M. Pathak, S.
Some, P. Vyas, R. Fradera, M. Belkacemi, A. Hasija, G. Lisboa, S. Luz,
J. Malley, (eds.)]. Cambridge University Press, Cambridge, UK and New
York, NY, USA. doi: 10.1017/9781009157926.001, available at https://
report.ipcc.ch/ar6wg3/pdf/IPCC_AR6_WGIII_SummaryForPolicymakers.pdf.
---------------------------------------------------------------------------
\3\ ``The evidence is clear: the time for action is now. We can
halve emissions by 2030,'' IPCC Press Release, April 4, 2022, https://
www.ipcc.ch/2022/04/04/ipcc-ar6-wgiii-pressrelease/.
\4\ Eric Roston, ``Planet's Breakneck Warming Likely to Pass 1.5+C,
UN Scientists Warn,'' Bloomberg, April 4, 2022, https://
www.bloomberg.com/news/articles/2022-04-04/planet-s-breakneck-warming-
likely-to-pass-1-5-c-un-scientists-warn?cmpid=BBD040422_GREENDAILY&utm
_medium=email&utm_source=newsletter&utm_term=220404&utm_campaign=greenda
ily.
---------------------------------------------------------------------------
The science tells us we must achieve net zero greenhouse gas
emissions by or before 2050. That seems far away, but it takes time for
policies to take effect, and to adopt new technologies. The greenhouse
gases we emit into our atmosphere today will warm our world for
decades. Getting on a safe climate pathway requires cost-effective
solutions capable of scaling quickly. Electrification is an essential,
cost-effective strategy to achieve this goal by switching end-uses that
currently run on fossil fuels to run on carbon-free electricity. For
example, swapping out an old gas furnace for a more efficient all-
electric air-source heat pump, or driving an electric vehicle in lieu
of an internal combustion engine vehicle. As I will discuss in my
testimony, electrifying buildings, transportation, and much of industry
powered by a clean grid puts us on the path to achieving a stable
climate, while creating jobs and improving public health. It is also a
pathway to enhance energy security and ensure our global
competitiveness.
The International Energy Agency's Net Zero by 2050 report calls out
electrification as a core solution to achieve net zero emissions: ``As
electricity generation becomes progressively cleaner, electrification
of areas previously dominated by fossil fuels emerges as a crucial
economy-wide tool for reducing emissions. This takes place through
technologies like electric cars, buses and trucks on the roads, heat
pumps in buildings, and electric furnaces for steel production.'' \5\
Similarly, the Working Group III report notes that ``[s]tringent
emissions reductions at the level required for a 2+C and below are
achieved through increased direct electrification of buildings,
transport, and industry, resulting in increased electricity generation
in all pathways (high confidence).'' \6\
---------------------------------------------------------------------------
\5\ ``Net Zero by 2050: A Roadmap for the Global Energy Sector,''
International Energy Agency, May 2021, https://www.iea.org/reports/net-
zero-by-2050.
\6\ ``Working Group III contribution to the Sixth Assessment
Report, Chapter 3: Mitigation pathways compatible with long-term
goals,'' IPCC Sixth Assessment Report: Mitigation of Climate Change,
https://report.ipcc.ch/ar6wg3/pdf/
IPCC_AR6_WGIII_FinalDraft_Chapter03.pdf, 3-6.
---------------------------------------------------------------------------
All-electric technologies are considerably more efficient than
fossil fuel counterparts, and this inherent efficiency reduces fossil
fuel demand with a dampening effect on prices--which helps all
consumers. Because electricity is a price-stable commodity, electric
technologies are far cheaper to operate and help protect consumers from
volatility and price shocks.
We have the technologies, and they are increasingly cost-effective,
but smart policies and regulations are needed to jumpstart the market.
Today, we are experiencing a perfect storm of converging factors
whose root cause is our overreliance on oil and gas: volatile and high
fuel prices, devastating climate events, and energy insecurity. It is
important to think both about the near- and long-term impacts of any
solutions or actions so that solving one problem does not exacerbate
others.
As this Committee has discussed at length, the high price \7\ of
gas and oil is hurting Americans at the pump and at home \8\ and is
increasing energy burdens \9\ for lower- and middle-income households.
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\7\ ``Gas Prices,'' AAA website, https://gasprices.aaa.com,
accessed April 5, 2022.
\8\ ``Short-term Energy Outlook: Winter Fuels Outlook, October
2021'' U.S. Energy Information Administration, March 8, 2022, https://
www.eia.gov/outlooks/steo/report/WinterFuels.php.
\9\ Energy burden refers to the relative proportion of your income
that goes to pay energy bills, including for home heating and fueling a
vehicle. Energy burden is different than an energy bill, which is the
rate you pay for electricity combined with how much you use. With
energy efficiency and conservation measures, even where electricity
rates are high, you can reduce energy bills and help mitigate high
energy burdens. According to ACEEE, 25% of U.S. households face a high
energy burden (spend 6% or more of their income on energy bills), and
low-income households spend three times more of their income on energy
costs compared to the average non-low-income households (8.1% vs 2.3%).
Source: https://www.aceee.org/energy-burden
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These high prices are caused by a post-pandemic surge in consumer
demand \10\ for oil and gas combined with supply shocks caused by
global shutdowns, extreme weather events, and Putin's war against
Ukraine.\11\
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\10\ David Gaffen, Scott DiSavino, and Stephanie Kelly, ``U.S.
December oil demand
hits highest since before pandemic--EIA,'' Reuters, February 28, 2022,
https:
//www.reuters.com/business/energy/us-oil-demand-reached-highest-level-
since-before-pandemic-december-eia-2022-02-28/.
\11\ ``Making Sense of Soaring Oil Prices,'' Columbia Energy
Exchange Podcast, March 22, 2022, https://
www.energypolicy.columbia.edu/making-sense-soaring-oil-prices.
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Oil is a global commodity, and natural gas increasingly so, meaning
oil and gas markets operate outside the boundaries of any one country.
Increasing short-term domestic production can provide some immediate
relief, but no amount of domestic drilling and production will insulate
us from this unending cycle of price volatility.
Fortunately, electrification can stabilize prices by reducing
fossil fuel demand because all-electric technologies are highly energy
efficient. Today's efficient electric technologies offer a hedge
against price spikes. For example, air source heat pump furnaces are
two to four times more energy-efficient than natural gas-burning
furnaces.\12\ Induction stoves outperform gas stoves by about three to
one.\13\ Electric vehicles are nearly four times as efficient as
internal combustion engine vehicles.\14\
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\12\ Claire McKenna, Amar Shah, and Mark Silberg, It's Time to
Incentivize Residential Heat Pumps, RMI, June 8, 2020, https://rmi.org/
its-time-to-incentivize-residential-heat-pumps/.
\13\ Micah Sweeney, Jeff Dols, Brian Fortenbery, and Frank Sharp,
Induction Cooking
Technology Design and Assessment, ACEEE, 2014,
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https://www.aceee.org/files/proceedings/2014/data/papers/9-702.pdf.
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\14\ ``All-Electric Vehicles,'' U.S. Department of Energy,
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https://www.fueleconomy.gov/feg/evtech.shtml
Inherent efficiency advantages make electric technologies cheaper
to operate, and electricity is more price-stable than oil and gas
without global market volatility. Electricity is generated from diverse
homegrown resources and electric utilities and the grid are regulated
by federal, state, regional, and local entities tasked with ensuring
affordable and reliable electricity for all consumers.
Today, U.S. households and businesses that rely on fossil fuels for
transportation and heat are being hit with higher energy bills and
gasoline bills, whereas those who live in all-electric homes or drive
electric vehicles have been insulated from this price shock.
A recent analysis conducted by the Zero Emissions Transportation
Association shows electric vehicles are three to five times cheaper to
drive per mile than gas-powered vehicles, and in several states are
five to six times cheaper to drive per mile.\15\ Analysis from
University of California, Berkeley, Energy Innovation, and GridLab
(known as the 2035 2.0 Study) shows light-duty electric vehicles will
hold a total cost of ownership advantage within the next five
years.\16\
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\15\ Comparing the Operating Costs of Electric Vehicles and Gas-
Powered Vehicles, Zero Emissions Transportation Association, April
2022,
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https://drive.google.com/file/d/1_d6OXxWpF6GzBjZiFP3oj0QqQTM1P5io/view.
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\16\ Amol Phadke, N. Abhyankar, J. Kersey, T. McNair, U. Paliwal,
D. Wooley, O. Ashmoore, R. Orvis, M. O'Boyle, R. O'Connell, U. Agwan,
P. Mohanty, P. Sreedharan, and D. Rajagopal, Plummeting Costs and
Dramatic Improvements in Batteries Can Accelerate Our Clean
Transportation Future, University of California, Berkeley Goldman
School of Public Policy, Energy Innovation, and Grid Lab, April 2021,
http://www.2035report.com/transportation/wp-
content/uploads/2020/05/2035Report2.0-1.pdf?hsCtaTracking=544e8e73-
752a-40ee-b3a5-
90e28d5f2e18%7C81c0077a-d01d-45b9-a338-fcaef78a20e7.
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All-electric homes also save money. RMI analysis comparing new all-
electric single-family homes with dual fuel homes in seven cities \17\
shows that a new all-electric, single-family home has a lower net
present cost than the new mixed-fuel home with lower annual utility
costs in most cases.\18\ All-electric new homes also yield emit 50
percent up to 93 percent fewer greenhouse gases compared to mixed-fuel
homes.\19\
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\17\ Austin, Texas; Boston, Massachusetts; Columbus, Ohio; Denver,
Colorado; Minneapolis, Minnesota; New York City, New York; and Seattle,
Washington.
\18\ The two modeled scenarios have nearly equivalent utility bills
in Boston and Seattle.
\19\ Claire McKenna, Amar Shah, and Leah Louis-Prescott, ``All-
Electric New Homes: A Win for the Climate and the Economy,'' RMI,
October 15, 2020, https://rmi.org/all-electric-new-homes-a-win-for-the-
climate-and-the-economy/.
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Although the promise of energy savings is enticing, many consumers
face upfront cost barriers and challenges accessing financing. Though
costs are declining ahead of most projections, policies, regulations,
and incentives can bring down costs further, level the playing field
for all-electric technologies. Upfront incentives, applied at the
point-of-purchase, are highly effective tools for equitable market
transformation.\20\
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\20\ Sam Abuelsamid, ``EV Purchase Incentives Need to Shift to
Point-of-Sale Rebates,'' Guidehouse Insights, June 24, 2021, https://
guidehouseinsights.com/news-and-views/ev-
purchase-incentives-need-to-shift-to-point-of-sale-rebates.
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The upside to electrification is that we already have the
technologies we need to start electrifying more end-uses today, without
compromising performance. We don't have to wait for a new technology
breakthrough or an unproven, costly alternative to become viable \21\
because conversion can occur incrementally using existing electrical
infrastructure. In the U.S., 25 percent of homes are already all-
electric,\22\ and almost half of single-family homes are appropriately
wired for all-electric appliances.\23\ Many buildings have sufficient
electrical capacity to switch to all-electric appliances today, though
older buildings might require electrical upgrades like a new panel or
wiring. Consumers replacing older equipment, appliances, and vehicles
can opt for all-electric options. Or, when building or buying new, they
can choose all-electric options, avoiding potentially costly upgrades
down the road. However, model and product availability to meet consumer
needs is closely tied with policy support. As such, it is important for
policies to send strong market signals to manufacturers, contractors,
distributors, and dealers to encourage them to make and sell high
performing, energy-efficient all-electric products.
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\21\ Sara Baldwin, Dan Esposito, and Hadley Tallackson, Assessing
the Viability of Hydrogen Proposals: Considerations for State Utility
Regulators and Policymakers, Energy Innovation, March 28, 2022, https:/
/energyinnovation.org/publication/assessing-the-viability-of-hydrogen-
proposals-considerations-for-state-utility-regulators-and-
policymakers/.
\22\ ``One in Four U.S. Homes is All Electric,'' U.S. Energy
Information Administration, May 1, 2019, https://www.eia.gov/
todayinenergy/detail.php?id=39293.
\23\ Pecan Street, Addressing an Electrification Roadblock:
Residential Electric Panel Capacity, https://www.pecanstreet.org/panel-
size-paper-update/, page 1.
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More relevant to this Committee, electrification plus a clean grid
puts us on a climate stable path while creating jobs, improving public
health, and ensuring global competitiveness. Energy Innovation's U.S.
Energy Policy Simulator modeling shows that electrification policy
pathways combined with a clean grid--powered by a diverse mix of
carbon-free resources like wind, solar, geothermal, hydroelectric,
paired with batteries, existing nuclear and gas, and demand-side
resources--can cut emissions, increase gross domestic product $570
billion per year in 2030 and $920 billion in 2050, and create more than
3.2 million new job-years by 2030 and 5 million new job-years by
2050.\24\ The wedge graph below shows U.S. emissions under business-as-
usual and the 1.5+C Scenario, including how much each specific policy
reduces emissions through 2050. Although these are illustrative
pathways, the electrification policies for buildings, transportation,
and industry all contribute significant emissions reductions.
[GRAPHIC] [TIFF OMITTED] T7955A.001
\24\ Robbie Orvis and Megan Mahajan, ``A 1.5+C NDC For Climate
Leadership by the United States,'' April 2021, https://
energyinnovation.org/wp-content/uploads/2021/04/A-1.5-C-Pathway-to-
Climate-Leadership-for-The-United-States_NDC-update-2.pdf.
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Transportation is the largest source of U.S. GHG emissions,
contributing 29 percent of all emissions in 2019 and rising, unlike the
electricity sector. Annual transportation emissions grew 22.9 percent
between 1990 and 2019--the largest growth in annual emissions from any
sector.\25\ The 2035 2.0 Study showed that reaching 100 percent
electric sales for all new cars and trucks by 2035 would cut
transportation-related GHGs 93 percent, and put the U.S. on a path to
net zero economy-wide emissions in 2050, avoiding the most devastating
impacts of climate change. This would also create more than 2 million
jobs in 2035 as compared with business-as-usual.\26\ Adding more
emphasis on domestic manufacturing would only amplify those job
numbers.
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\25\ ``Greenhouse Gas Inventory Data Explorer,'' United States
Environmental Protection Agency, https://cfpub.epa.gov/ghgdata/
inventoryexplorer/#allsectors/allsectors/allgas/econsect/all.
\26\ Amol Phadke, et al., Plummeting Costs and Dramatic
Improvements in Batteries Can Accelerate Our Clean Transportation
Future.
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In the U.S. nearly 90 million residential housing units and 4
million commercial buildings burn fossil fuels for space and water
heating and cooking, and those buildings contribute 13 percent of our
nation's GHG emissions.\27\ Rewiring America analysis shows that we can
avoid 166 million metric tons of carbon dioxide (CO2)
emissions by deploying heat pump technology across 104.7 million
households (or 87 percent of U.S. households) today.\28\ Building and
retrofitting electrified homes and buildings across the country will
require hundreds of thousands of skilled workers, creating more than
460,000 installation jobs, 80,000 manufacturing jobs, and 800,000
indirect and induced jobs in the U.S.\29\
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\27\ Sara Baldwin and Hadley Tallackson, Making Buildings Better,
Energy Innovation, December 2021, https://energyinnovation.org/wp-
content/uploads/2021/12/Making-Buildings-Better-in-the-Build-Back-
Better-Act.pdf.
\28\ ``Benefits of Electrification,'' Rewiring America, https://
map.rewiringamerica.org.
\29\ ``Benefits of Electrification,'' Rewiring America, https://
map.rewiringamerica.org.
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Even if we power our electric vehicles and homes with today's grid
(which is not yet 100 percent carbon-free), we will still reduce net
emissions. A Union of Concerned Scientists study shows that electric
vehicles are already cleaner than gas vehicles in all states,
regardless of regional differences in grid mix.\30\ We have an
opportunity to begin reducing emissions today with the adoption of
efficient electric technologies, while we continue to drive towards a
carbon-free grid.
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\30\ David Reichmuth, ``Electric Vehicles are Cleaner than
Gasoline--and Getting Better,'' Union of Concerned Scientists Fact
Sheet, May 2020, https://www.ucsusa.org/sites/default/files/2020-
05/evs-cleaner-than-gasoline.pdf.
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However, given the slow pace of capital stock turnover,\31\ we need
to start electrifying as many end-uses now as feasible to be on the
path to climate stability by 2030 and ultimately 2050.
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\31\ Amanda Myers, ``The Capital Stock Turnover Problem for 100%
Clean Energy Targets,'' Greentech Media, November 18, 2019, https://
www.greentechmedia.com/articles/read/the-capital-stock-turnover-
problem-for-100-clean-energy-targets.
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Electrification will also improve public health and reduce harmful
air pollution indoors and outdoors. Nearly half of all U.S. residents
live in counties with unhealthy ozone and particle pollution,\32\ and
more than 20,000 die prematurely \33\ every year from transportation
pollutants. Transportation electrification will reduce a major source
of harmful air pollutants, which disproportionately impact economically
disadvantaged and communities of color \34\, children, pregnant women,
and the elderly. The 2035 2.0 study found that electrifying cars and
trucks would avoid 96 percent of the premature deaths caused by
transportation pollution.\35\ Similarly, all-electric appliances and
stoves can significantly reduce toxic air pollution in homes \36\ and
cut outdoor air pollution damaging to human health.\37\
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\32\ 2020 State of the Air Report, American Lung Association,
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https://www.stateoftheair.org/assets/SOTA-2020.pdf.
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\33\ Kenneth Davidson, N. Fann, M. Zawacki, C. Fulcher, and K.
Baker, The recent and future health burden of the U.S. mobile sector
apportioned by source, Environmental Research Letters, Volume 15,
Number 7, July 6, 2020, https://iopscience.iop.org/article/10.1088/
1748-9326/ab83a8.
\34\ American Lung Association 2020 State of the Air Report.
\35\ Amol Phadke, et al., Plummeting Costs and Dramatic
Improvements in Batteries Can Accelerate Our Clean Transportation
Future.
\36\ ``Combustion Pollutants in Your Home--Guidelines,'' California
Air Resources Board, https://ww2.arb.ca.gov/resources/documents/
combustion-pollutants-your-home-guidelines, accessed April 5, 2022.
\37\ Dr. Yifang Zhu, R. Connolly, Dr. Y. Lin, T. Mathews, Z. Wang,
Effects of Residential Gas Appliances on Indoor and Outdoor Air Quality
and Public Health in California, UCLA Fielding School of Public Health,
Department of Environmental Health Sciences, April 2020, https://
ucla.app.box.com/s/xyzt8jc1ixnetiv0269qe704wu0ihif7.
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Electrification is synergistic with updating the electric grid to
improve reliability, and more electric end-uses will cut per unit
consumer costs. U.S. electric utilities have historically invested $30
billion per year into the grid, and more investments will be needed to
support more electrified end-uses.\38\ But these investments will make
the grid stronger and more reliable and resilient.\39\ Increased
electricity demand from electrification will spread grid upgrade
expenses over a much larger sales volume, lowering the cost per unit of
electricity and benefitting 100 percent of U.S. residents that use
electricity.\40\ Combined with demand response and distributed energy
resources, all-electric buildings provide unique load flexibility and
other benefits, including integrating more renewable energy and
expanded electric vehicle charging. For example, electric appliances
can be programmed to respond to grid conditions and price signals, and
if set up to do so, can provide valuable grid services and demand
response when called upon by utilities. New smart grid funding from the
bipartisan Infrastructure Investment and Jobs Act (IIJA) for will
support continued deployment of these functions and capabilities at
scale.\41\ All-electric equipment can also be supported with
distributed or community solar and battery storage to increase
resilience when the grid goes down. No such back-up technologies exist
for oil and gas equipment--which are also subject to grid outages. For
example, you cannot pump gasoline or use most modern gas furnaces
without electricity.
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\38\ Amol Phadke, et al., Plummeting Costs and Dramatic
Improvements in Batteries Can Accelerate Our Clean Transportation
Future.
\39\ Katherine Hamilton remarks for the Federal Energy Regulatory
Commission Technical Conference on Electrification and the Grid of the
Future, Docket No. AD21-12-000, April 29, 2021, https://www.ferc.gov/
media/panel-1-katherine-hamilton-world-economic-forum.
\40\ Baldwin, et al., Assessing the Viability of Hydrogen
Proposals.
\41\ Ellie Long, ``Here's How the Infrastructure Bill Improves the
Grid,'' Alliance to Save Energy, November 22, 2021, https://
www.ase.org/blog/heres-how-infrastructure-bill-improves-grid.
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Despite their advantages, all-electric technologies are nascent
relative to their fossil fuel-powered counterparts, and they stand to
benefit from strong policies to jumpstart the market. Government
policies, strong standards, and regulations can enable mainstream
adoption, allowing more consumers to benefit from these technologies.
Rigorous performance and efficiency standards are the foundation upon
which policies should be built, reducing consumer costs, leveling the
playing field for businesses, and amplifying the impact of other
policies. For example, the U.S. Department of Energy and U.S.
Environmental Protection Agency's work updating energy conservation
standards for space- and water-heating equipment can save U.S.
consumers and businesses more than $100 billion on energy bills through
2050 while reducing cumulative CO2 emissions by more than
500 million metric tons.\42\ Similarly, EPA's recent update to tailpipe
emissions standards will reduce GHG emissions 3.1 billion tons by 2050,
representing 50 percent greater emission reductions than their less
stringent proposed standards, and will unlock $190 billion in net
benefits, including reduced climate change impacts, improved public
health from lower pollution, and cost savings for vehicle owners.\43\
But, more is needed.
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\42\ ASAP analysis based on Mauer, J. and A. deLaski, ``A Powerful
Priority: How Appliance Standards Can Help Meet U.S. Climate Goals and
Save Consumers Money.'' 2020. Available at https://appliance-
standards.org/sites/default/files/Powerful_Priority_Report.pdf.
Products evaluated included residential and commercial gas-fired
furnaces, boilers, and water heaters.
\43\ ``EPA Finalizes Greenhouse Gas Standards for Passenger
Vehicles, Paving Way for A Zero-Emissions Future,'' US Environmental
Protection Agency, December 20, 2021, https://www.epa.gov/newsreleases/
epa-finalizes-greenhouse-gas-standards-passenger-vehicles-paving-way-
zero-emissions; and ``Final Rule to Revise Existing National GHG
Emissions Standards for Passenger Cars and Light Trucks Through Model
year 2026,'' US Environmental Protection Agency, https://www.epa.gov/
regulations-emissions-vehicles-and-engines/final-rule-revise-existing-
national-ghg-emissions.
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We need practical and equitable incentives to help reduce upfront
cost of electric technologies and send market signals. One of the
biggest barriers to uptake is the slightly higher incremental cost of
all-electric appliances and equipment. The International Council on
Clean Transportation projects that electric vehicles will reach upfront
price parity with gas vehicles within the next two to three years for
shorter-range vehicles and within four to six years for longer-range
vehicles.\44\ Until that transpires, government leadership can help
bridge this gap and get more consumers in price-stable electric
vehicles.
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\44\ Nic Lutsey and Michael Nicholas, Working Paper: Update On
Electric Vehicle Costs in the United States Through 2030, The
International Council on Clean Transportation, April 2, 2019, https://
theicct.org/publication/update-on-electric-vehicle-costs-in-the-united-
states-through-2030/.
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Congress' passage of the incentives for new and used electric
vehicles \45\ and electric equipment for buildings \46\ at the end of
last year was an important first step in addressing this barrier.
Ideally, such incentives would be integrated into any future policies
under consideration by Congress and the Senate.\47\ Any future policies
should include provisions that ensure equity, expand access, and
meaningfully address environmental justice. For example, including
incentives for used electric vehicles would help the millions of U.S.
residents that choose not to buy or cannot afford a new vehicle.
Appropriate income caps, capping the vehicle value, and limiting the
incentive based on the vehicle price will ensure the electric vehicles
tax incentive is available to as many people as possible, while
excluding high-income individuals and households that are far less
likely to need an incentive to motivate their purchase decisions.
Higher incentives for electric equipment located in multi-family
housing and for frontline and underserved communities are other
examples of common-sense policy provisions that merit future
consideration to ensure an equitable transition.
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\45\ Electric Vehicle Incentives in the Build Back Better Act,
Energy Innovation, November 2021, https://energyinnovation.org/wp-
content/uploads/2021/11/Electric-Vehicle-Incentives-in-the-Build-Back-
Better-Act.pdf.
\46\ Baldwin, Making Buildings Better.
\47\ A University of California, Davis study documented the
efficacy of EV tax incentives for middle- and moderate-income earners,
finding federal tax credits are one of the most important incentives
for owners of moderately-priced EVs. Source: https://escholarship.org/
uc/item/0x28831g.
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Ensuring seamless adoption of electric technologies needs
sufficient support for the infrastructure and workforce supporting
them. The IIJA was a good start, allocating $7.5 billion to help build-
out a national electric vehicle charging network to reduce range
anxiety and ensure equitable access to charging for people in rural and
urban communities.
Although I've not touched on it in detail today, more support is
needed for industrial electrification. Direct GHG emissions from the
U.S. industrial sector make up roughly a quarter of the nation's total,
yet very few policies and programs are focused on this sector.
Industrial operations are an untapped opportunity to provide greater
price stability for Made in America commodities by shifting more
industrial processes to run on electricity. Lawrence Berkeley National
Lab research shows industrial electrification could reduce fuel price
risks and improve product quality in some industrial processes, noting
that many essential industrial electrification technologies exist, but
the diversity of processes and high levels of process integration make
solutions more complex.\48\ More funding is needed for research,
development, and demonstration of electrification of low- to medium-
heat industrial process heating and new programs to help address the
economic and regulatory challenges to industrial electrification. Two
existing tools that can and should be leveraged for this purpose are
DOE's ARPA-E \49\ program and the America COMPETES Act.\50\
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\48\ ``New study explores prospects and approaches for increased
electrification of buildings and industry,'' Lawrence Berkeley National
Lab, April 9, 2018, https://emp.lbl.gov/news/new-study-explores-
prospects-and-approaches.
\49\ ``Technologies,'' ARPA-E, https://arpa-e.energy.gov/
technologies.
\50\ ``America Competes Act,'' Public Law 110-69, Authenticated
U.S. Government Information, August 9, 2007, https://www.congress.gov/
110/plaws/publ69/PLAW-110publ69.pdf.
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More support for domestic manufacturing of electric appliances and
domestic production of the key minerals and raw materials needed for
electric vehicles, batteries, electric appliances, and other clean
technologies will improve America's competitiveness and insulate our
economy from supply chain disruptions, as we electrify more end uses.
Immediate steps to increase domestic supply chain of electric
technologies through incentives for domestic manufacturing and domestic
production of essential minerals and raw materials will ensure those
jobs are created here and not outsourced. President Biden's recent
invocation of the Defense Production Act for critical minerals is an
important first step in this direction.\51\
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\51\ Steven Mufson and Paulina Villegas, ``Biden to use Defense
Production Act for U.S> critical-minerals supply,'' The Washington
Post, March 31, 2022, https://www.washingtonpost.com/climate-
environment/2022/03/30/critical-minerals-defense-production-act/.
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Policies should consider workforce development opportunities and
challenges inherent to technological changes. Electrification can
create millions of jobs, but workers will need access to training,
professional development, and in some cases incentives to help them
retool or make necessary upgrades. The IIJA, for example, provides
dedicated funding for workforce training in the power, buildings, and
industrial sectors. As more policies are considered, they should
continue to account for the workforce transition already underway.
In conclusion, the urgency of our climate crisis combined with the
inherent volatility of fossil fuels requires that we work quickly to
scale solutions that replace fossil fuel end-uses and equipment with
zero-carbon alternatives. We cannot wait until 2030 or later to start.
Electrification is a viable solution that offers a path to reduce our
dependence on fossil fuels in the near- and long-term, support the
decarbonization of buildings, transportation, and some industry, reduce
consumer costs, improve public health, and create jobs. Smart policies
will electrify the movement and energize our economy.
Thank you for your time and I look forward to questions and
discussion.
Ms. Castor. Well, thank you to all of our witnesses for
your insightful testimony. I will recognize myself for the
first 5 minutes for questions.
You know, it really has been a remarkable last decade to
watch the American innovation in energy, innovation in
appliances, and housing, and materials. And it holds such
promise to help our neighbors back home reduce their electric
bills and save money; but also, reduce pollution with all the
health benefits that brings and help us solve the climate
crisis. And that is why I am really proud of the Bipartisan
Infrastructure Law that President Biden championed, that has
these historic investments in weatherization, which means the
ability to add insulation to your homes, more energy efficient
appliances, and smart meters, and things like that. It means we
are going to update our building codes, and we provided
historic resources for electric vehicle charging, and even down
to helping public schools become more energy efficient and save
taxpayers money overall.
But Ms. Baldwin, you know, you have taken a deep dive,
Energy Innovation certainly has done a really comprehensive
analysis. There are a lot of naysayers out there that say, Oh,
okay, we can't have a reliable grid, we can't have all of these
things, we can't save money and reduce pollution, and help
solve the climate crisis. What do you say after all of your
work and analysis looking at the EE opportunities?
Ms. Baldwin. Thank you for that question Chair Castor.
What I would say is that, you know, our model informs our
work. We really try to identify the solutions that are most
cost effective, that simultaneously create co-benefits. As I
mentioned, creating a clean grid powered by carbon free
electricity, and then electrifying as many end uses as possible
shows repeatedly that that is the way to drive down emissions,
and we can do so by saving consumers money, but also creating
American jobs.
Is it easy? No. We have work to do. I think that is clearly
the message for this committee as well as the committee--excuse
me, as well as this body. There are ample opportunities to
correct market failures with strong policy and leadership. And
I think that, as I mentioned in my testimony, the
reconciliation package forthcoming that may or not pass----
Ms. Castor. Oh, it is coming----
Ms. Baldwin [continuing]. Is a great opportunity to rectify
these market failures, to fill in the gaps that the
Infrastructure Act did not address, and really address the
American consumer and the businesses here in figuring out ways
to benefit them.
Ms. Castor. And Mr. Johnson, you are doing a lot of that
hard work on the ground. I mean, this is labor intensive to
help folks on the ground, small business owners, folks who are
just trying to get through the day. Tell me what has been
successful? And now with these historic investments just under
the Bipartisan Infrastructure Law and hopefully with some of
the other tax credits, what is happening out there? And what
opportunities do you see? And what else do you need for the
Congress to help folks put the insulation in their homes,
weatherize their homes, get the energy efficient appliances in?
Mr. Johnson. Thanks for the question, Chair Castor. I think
it is very insightful that we begin to look at what is going on
at the ground level. And as we begin to look at different
legislations such as HOPE for HOMES, and the HOPE for HOMES Act
and the Zero Energy Home Act, all of these different types of
bills that are making resources readily available to empower
the contractor, at the ground, the boots on the ground.
Ms. Castor. Tell us a story of a contractor. Tell us a
personal story----
Mr. Johnson. Sure.
Ms. Castor [continuing]. Of what you've seen on the ground
where you do work.
Mr. Johnson. Absolutely. And I think that most importantly
what is most transformative to me is when we began to see how
these resources directly impact the contractor and their
ability to scale their businesses, and create local jobs, and
create opportunities for small business development, and
expansion of those small businesses. As we began to see the
infusion of resources, we have been able to see small
businesses empowered to deliver training for their existing
staff to be able to scale up, while being able to afford to
bring on new employees to be able to expand their business
model to deliver on the growing demand of energy efficiency and
the other sustainability best practices that are out there. And
so, it is really important to see that happening, because that
is where the magic really happens. Oftentimes, on the ground
where we don't see those lives transform, those businesses
expanding, and those communities receiving services that they
traditionally have been overlooked. And so, that is empowering
for me when you understand the disproportionate nature by which
historically those services have not been delivered.
Ms. Castor. Thank you very much.
Mr. Armstrong, good morning. You are recognized for 5
minutes.
Mr. Armstrong. Thank you, Madam Chair. It is just
interesting to me how different places in the world are, and
even in our own country, as there is a lot of communities doing
what they can, either rightly or wrongly, to try and wean
themselves off of gas, we are trying to get more in North
Dakota. And, you know, over the last 10 years, our state has
grown about 16 percent, which for a small rural state is a lot,
but it doesn't tell the whole story. We have had tremendous
growth in the western part of the state, tremendous growth in
the eastern part of the state. But our rural ag communities in
the center part of our state continue to have an out migration.
And the number one thing I hear from every one of those
communities, in order to survive in the 21st century, we need
water, and we need gas, and we need it for things that are
important, not just for North Dakota, but I think for the whole
country and the world right now. Trying to get a fertilizer
plant put together. We have a soybean crushing facility that
will then take its products and put them into a biodiesel
refinery, of which we sell almost all of it to the State of
California.
And listen, not all problems with this are borne out of the
Federal Government. I know it is easy to deal with this, but we
have had a tremendous oil boom in western North Dakota and have
fought, and fought, and fought, and invested billions and
billions of dollars to get gas infrastructure in place so we
can actually deliver that associated gas that we are capturing
in the western part of the state to some of our communities.
And we need it. And we don't have the other options. I mean,
there is not a member on this committee that doesn't support
energy efficiency. It is good for the consumer; it is good for
the environment. And year over year, producers throughout the
system improve a variety of household items to increase
efficiency and deliver energy savings to the market. And at-
home consumers demand everything from windows, to heating
systems, to small appliances, consumers demand these items
delivery efficiency at an affordable price and the market
provides.
However, I do--and I do get concerned whenever we talk
about, and have these conversations about energy efficiency
because they often, in this town, tend away from cooperation
and move towards mandates, and voluntary programs that allow
the market to innovate and the consumer decide just work
better, because they work better in North Dakota, compared to
Colorado, compared to wherever else, because the on-the-ground
demands are just different, depending on where you live.
So Mr. Schryver, the ENERGY STAR program is a well-known
guide for consumers looking to choose more energy efficient
items for their home. Seeing the blue label on an application
is a powerful indicator that guides consumers in a certain
direction when purchasing at-home appliances. In your
testimony, you mention the cost savings provided by gas
appliances. Are those included in the ENERGY STAR program?
Mr. Schryver. Not to the extent that we would like. We
believe there should be a greater focus on the cost associated
with operating the appliance. And as I mentioned earlier, just
tremendous savings associated with natural gas appliances.
The way the program is structured right now, natural gas
appliances do not make that top cut of the most elite, most
efficient under ENERGY STAR. We, as I said earlier, we do
believe that natural gas appliances are the most efficient on a
cyber-source basis. They are 92 percent efficient. You don't
lose three times that efficiency that you do on electricity. So
we would like to see the program revamped to include natural
gas appliances in that top tier.
Mr. Armstrong. Well, and would it be fair to say through
EPA actions, there are entire communities in states like mine
that will not be able to take advantage of the program now
because they don't have other options?
Mr. Schryver. We think--studies have shown consumers prefer
natural gas. They prefer it for cooking, they prefer it for
heating. It is more efficient. It is more affordable, you know.
Overall, it is domestically produced. So from APGA's
perspective, we are concerned about any Federal action that
precludes the ability of a consumer to choose which appliance
works best for them. And we have seen standards at the
Department of Energy that we believe push people away from
natural gas furnaces. That is something we are focused on.
Mr. Armstrong. Can you specifically walk through some of
the costs associated with forced electrification and current
efforts to increase the efficiency of gas appliances?
Mr. Schryver. Sure. If you have forced electrification, you
are going to have costs associated with switching your
appliances out, you are going to have costs associated with
upgrading your electric panel, you are going to have costs
associated with upgrading generation and transmission. All
those costs can be passed on to consumers and they are
significant.
Mr. Armstrong. But it is not just efforts to ban or
discourage the use of appliances in the home. In your
testimony, you mention efforts at the local level to cut off
supply, including through bans in natural gas hookups.
What policy proposals at the Federal level may have a
similar effect?
Mr. Schryver. We haven't seen anything at the Federal
level, just at the local level, as you stated. We have seen
communities ban new natural gas hookups, which more or less
creates a death spiral for that local gas utility.
At the Federal level, in the past we have seen appliance
standards that push people away from natural gas, such as the
furnace standard that requires a condensing furnace.
Mr. Armstrong. Thank you.
I yield back.
Ms. Castor. Next up, Rep. Brownley.
I see you virtually. Welcome. You are recognized for 5
minutes.
Ms. Brownley. Thank you, Madam Chair, and thank you for
holding this hearing.
I wanted to talk about a bill that I introduced a while
ago. It is a bill around energy efficient appliances for both
consumer products and industrial equipment.
The bill allows states to set stricter standards than the
national standard when the DOE misses statutory deadlines for
issuing new or revised standards. It expands the pool of
products that DOE may issue standards. It reduces the lead time
for when standards must come into effect, generally to a
maximum of 3 years. And it gives explicit authority to DOE that
it can evaluate more than one efficiency metric when measuring
products' performances.
So we know that products not covered by the Federal
standard have the potential to save Americans a substantial
amount of energy, and there are so many products that are not
under the Federal law that states are providing. They can
provide their own efficiency standards if it is not covered by
Federal law. And there are quite a few and the states seem to
be doing a better job, in my opinion, than the Federal
Government does.
So, Ms. Glover, can you kind of speak to, if we had better
Federal standards, higher standards, continuing standards that
continue to update with new technologies, et cetera, what
difference is that going to make for both consumers and for our
climate?
Ms. Glover. Congresswoman, I want to first apologize,
because I am not as familiar with your proposed bill. So I am
going to try my best to answer your question, but I am not
familiar with your bill and I want people to put that on the
record.
I think improved standards can always help consumers. But I
think we also want to ensure that we have the right standards
in place so that consumers can make the choices that are best
for them. And I think in doing that, in giving people the kind
of information that they need to make those choices, we can
resolve lots of problems.
My hesitancy is always that we have many problems that we
are trying to solve at the same time. We are trying to address
climate, we are trying to address affordability, and we are
trying to address security. And so we want to make sure that
creating a standard that solves one problem doesn't make
another problem worse. And so that would be my only hesitancy.
I also, though, believe that consumers are really the ones
who should have the say, and that, as we talk about equity, we
should be thinking and allowing communities to really speak on
their own behalf for what they believe is right for themselves
and how this transition should work for them.
Because in the end, I think that is, one, how we are going
to have some sustainable change that is going to be successful
and not have a flip-flop because we are trying to enact some
things that consumers aren't aligned with and do not support.
Ms. Brownley. So then do you think that it is better not to
have Federal standards and to have community standards, state
standards, that are more consistent with what the consumer----
Ms. Glover. No, I don't want to say that. No. So let me
correct myself. I am actually not saying that we should not
have Federal standards.
Ms. Brownley. Okay. And do you believe that the Federal
standards are not comprehensive enough?
Ms. Glover. I honestly, Congresswoman, do not know that I
would have enough information to say that they aren't or they
are. I just don't know enough.
Ms. Brownley. Okay.
Is there anybody else on the panel that might respond?
Ms. Baldwin. I would be happy to jump in, Congresswoman,
with one comment, which is there is absolutely room for
improvement with respect to appliance standards. We are lagging
relative to the rest of the world.
And in particular, with respect to all-electric appliances,
I think that there is much more that can be done to bring more
of them into the market and make them both more cost
competitive upfront, but also get the models and the products
into circulation. We are not seeing enough in circulation. So
more should be done and can be done.
Ms. Brownley. Thank you.
Madam Chair, I yield back.
Ms. Castor. Next, Rep. Palmer, you are recognized for 5
minutes.
Mr. Palmer. I thank the Chairman.
I thank the witnesses for being here.
Mr. Johnson, there is a township in Pennsylvania, Pembroke
Township, about 2,100 people, 85 percent or so are African
American. They have been heating their homes with wood, with
propane, which is fairly expensive. They haven't had natural
gas. Jesse Jackson, Al Sharpton, Marc Morial, major civil
rights leaders, have all been involved in trying to get a
natural gas pipeline in Pembroke Township.
Do you support their efforts to do that?
Mr. Johnson. I want to thank you for the question. I think
that is a very----
Mr. Palmer. Yes or no? Just, I mean, do you support their
efforts to get a natural gas pipeline so that these people can
have low cost--it is not as low cost as it used to be with the
Biden administration policies--but low cost, reliable fuel for
heating their homes in the wintertime? It is a yes or no.
Mr. Johnson. I think it is a bit more than a yes or no. I
mean, I think----
Mr. Palmer. No, it is yes or no. You either support it or
you don't.
Mr. Johnson. I think it is a bit more than yes or no.
Mr. Palmer. I think your answer is no. And I think you are
trying to filibuster the answer.
Mr. Johnson. No, I wouldn't say it is no. My answer is not
no. You asked me if I support their efforts. When you say their
efforts, I think their efforts are much broader than just
saying whether I support it on the premises of them getting
natural gas.
Mr. Palmer. No, sir, I am not going to let you filibuster
the answer. You either support getting this impoverished
community natural gas, which not only provides them with a
means of heating their homes, but also gives them the
opportunity to grow the local economy and create jobs.
And I don't understand why those of you on the other side
of the aisle just cannot say yes or no to a simple question. It
is because you don't support it.
Mr. Schryver, I have talked a lot about energy poverty,
energy injustice, economic injustice. I grew up dirt poor. We
heated our house with a coal heater. We cooled it with a box
fan in a window. So I kind of get this a little bit.
I just want to hear from you what benefit it has been to
American families, particularly low-income families, for the
revolution in natural gas. I will give you some stats and you
can comment on it.
Over the last decade natural gas prices have saved
consumers $1.1 trillion. Electricity customers' costs have gone
down by $203 billion. And Ms. Baldwin might be interested in
this, it saved 11,000 winter deaths.
Would you like to comment on that?
Mr. Schryver. Thank you for the question.
I agree with you, homes powered by, fueled by natural gas
save consumers money. And when you are talking about low-income
homes, that is especially important because that is less of
their percentage that is going to pay their utility bill.
Natural gas is fueling an industrial surge in states like
Georgia. It is, as I mentioned, it is cheaper than electricity.
It is more reliable than electricity. It is domestic. It is
abundant. It is resilient.
For all those reasons, we think consumers benefit from
having natural gas appliances in their home.
Mr. Palmer. Well, at the very beginning of the Biden
administration they began terminating leases on Federal lands.
We know the other things they have done that have caused prices
to go up. We were below $3 per million cubic feet of natural
gas, now we are up around, what, $6 or $7?
And that is coming right straight out of the pockets of
hardworking Americans that right now are struggling to pay
their energy bills, struggling to pay their food bills.
The U.S. Census Bureau reported that a fourth of all U.S.
households cut back on what they spend on food and medicine
because of higher utility costs.
In Great Britain, Ms. Baldwin, you might be interested to
know this, that in the winter of 2016-2017, because of the
tremendous increase in utility, household utility bills, there
were 17,000 excess winter deaths directly attributed to energy
poverty. I fear that is where we are heading in this country.
And, Mr. Schryver, would you like to comment on that?
Mr. Schryver. Sure. From APGA's perspective, our members
are fighting hard to preserve the ability of consumers to
choose natural gas. As I said, those who want to have natural
gas in their homes should be allowed to have it, whether it is
for cooking, water heating, cooktop, heating their home. We
believe consumers want natural gas and should have that choice.
Mr. Palmer. For the record, let it be known that my
Republican colleagues and I support lower household energy
costs for all Americans.
I yield back.
Ms. Castor. Rep. Bonamici, you are recognized for 5
minutes.
Ms. Bonamici. Thank you, Chair Castor.
And thank you to all of our witnesses.
We all know that investing in energy efficiency lowers
household and business energy costs, reduces emissions, and
mitigates the effect of climate change, including on
respiratory health.
In my state, we have Energy Trust of Oregon. It is an
independent, nonprofit organization that partners with our
local utilities to help consumers, their customers, benefit
from energy efficient use and also renewable energy generation.
In 2021, their efforts kept a total of 162,000 metric tons
of carbon dioxide out of the atmosphere. That is the equivalent
of removing 38,000 cars from Oregon roads for a year. So they
really do show that energy efficiency works.
Mr. Schryver, I want to thank you, first of all, for
acknowledging the need to transition to clean energy. Thank you
for that acknowledgment. But I note in your testimony you
talked about the cost of electrifying common household
appliances, and you said it would cost more than $258 billion.
I want to point out that that finding does not accurately
depict the actual costs and benefits of electrifying household
appliances. It only accounts for the upfront costs and not the
lower energy use and long-term savings that come from
electrification.
And second, it ignores the reality that thousands of
customers every year actually replace aging appliances. So it
is sort of analogous to discussing the cost of transitioning to
clean energy without considering the cost of inaction or the
benefits of transitioning.
And I wanted to ask Ms. Baldwin--I have a two-part
question--why do the long-term cost savings associated with
household electrification outweigh the upfront costs?
And second, how can we help appliance-buying consumers--and
this is following up on your answer to Representative
Brownley--how can we help appliance-buying customers make
choices that will save them money and keep the air they breathe
cleaner?
Ms. Baldwin. Thank you so much for that question,
Congresswoman.
As I stated in my testimony, energy efficient appliances,
and all-electric appliances in particular, hold an efficiency
advantage over their fossil fuel counterparts, which means that
for each unit that goes in to provide heat or heat water or to
cook, you get two to four times more out of that unit of heat.
And that is effectively why there are substantial energy
savings over the long-term.
In addition, electricity, as I mentioned, is a price-stable
commodity. We have a diverse source of resources that we draw
on to provide electricity. And that diversity effectively
creates a hedge against spikes in prices, as well as volatility
resulting from reliance on international markets. Oil and gas
are--oil especially, but increasingly natural gas--are global
commodities, and as such, they are subject to that volatility.
To your second question, helping consumers get access to
more efficient appliances and all-electric appliances is
paramount to success in this electrification effort.
I know that in Utah I cannot easily access an all-electric
heat pump without perhaps getting talked out of it by the
contractors that I call, who want to sell me a gas furnace. I
also know that I can't get an incentive from my utility because
fuel switching is prohibited by law.
I know that there are a lot of people out there who want to
do the right thing. They want to purchase an all-electric,
efficient heat pump, or an EV, or other appliances, and they
find upfront costs to be the barrier.
So policies that do two things: reduce the upfront cost,
make it a level playing field, increase the availability of
those appliances in the market, sending the right signals to
manufacturers and contractors alike, and also ensuring that
they have access to equitable financing.
Ms. Bonamici. Thank you.
Mr. Johnson, thank you for your testimony.
We know that, as you mentioned and Ms. Glover mentioned,
energy efficiency is also a boon for jobs. There were 2.1
million jobs in the energy efficiency space in 2020, more than
any other sector within the energy industry.
But job growth is potential and significant, but only 25
percent of the energy efficiency workforce is female, and Black
and Latino workers are underrepresented.
So, Mr. Johnson, what steps can Federal lawmakers take to
increase diversity in the energy efficiency workforce?
Mr. Johnson. Thank you for that question.
One of the things I think is very critical in terms of
increasing diversity is ensuring that there is access, local
access, to training opportunities, and making sure that those
training opportunities are diversified so that there is more
than one path to get you to certification and get you into an
industry that is growing at the rate that the energy efficiency
industry is growing.
I think that when we began to see more diversity within the
ranks of workforce and small business development, we began to
see broader adoption of those services and technologies in
underrepresented communities as well.
Ms. Bonamici. I appreciate that. And as a member of the
Education and Labor Committee, we just marked up the Workforce
Innovation and Opportunity Act the other day that is heading to
the floor that will do just that, to help people get into the
path to a good job and also diversify and make those
opportunities available to more.
My time has expired. Thank you, Madam Chair. I yield back.
Ms. Castor. Thank you.
Mr. Carter, you are recognized for 5 minutes.
Mr. Carter. Thank you, Madam Chair.
And thank all of you for being here. This is a very
important hearing.
But I have to admit that it is somewhat ironic that here we
have a hearing on how to promote energy security and cut energy
bills at a time when we have a lack of energy security and we
have record high energy prices directly as a result of the
policy of this administration, of the Biden administration.
That is just some irony that I find here.
Mr. Schryver, I am very glad that we have got you here
today. I appreciate you being here. You are with the American
Public Gas Association.
And gas is extremely important. It gives us reliable energy
to power our economy. And we really need natural gas well into
the future.
I want to share a story with you. I am a member of the
Conservative Climate Caucus, and about a month ago we were over
in Europe, in Brussels, and then we went up to Sweden. And we
had an opportunity to meet with the leaders over there about
what they are trying to do with renewables.
The unfortunate thing that we found there is that the
innovation is not keeping up with the public policy there. They
have already set in place the process of closing down nuclear
plants, and some of them are already closed. And yet they can't
provide for their energy needs with the renewables at this
point.
Now, hopefully, they will in the future, and I hope we will
here in this country in the future. But we can't right now.
And we look at natural gas, and before the Russian invasion
of Ukraine what we saw was Nord Stream 2, where they were going
to be getting natural gas from Russia to Germany and all
throughout Europe. And yet that is dirtier natural gas than
what we have here in America. We have some of the cleanest
natural gas and we have an abundance of it.
And I would share another story with you, and that is in my
district we have had an LNG plant that has converted from an
import plant to an export plant at Elba Island, in Chatham
County, in Savannah. And that is the kind of progress that we
need to have and the direction that we need to be moving, and I
am very convinced of that.
You know, when we talk about gas and natural gas, the
direct use of natural gas in homes is 97 percent efficient and
it is almost universally cheaper than electricity. And that is
significant again. And in Georgia, we have experienced that.
I know in some areas of this country, such as San
Francisco, Seattle, and New York, that they have actually
stopped using natural gas and prohibited from using it.
We have done just the opposite in Georgia. In fact, we have
had the State of Georgia and our legislature actually
prohibited local governments from banning natural gas or any
other type of energy. And I think that is the right move and I
am very proud.
And it is because of our use of natural gas in the State of
Georgia that we have been able for, I believe it is 7 years in
a row now, been the most business-friendly state in the nation,
and it is because we have low energy costs, because we utilize
natural gas.
Let me ask you, Mr. Schryver, as I just mentioned, gas is
very important to the State of Georgia. How is the push for
electrification impacting your members in my state?
Mr. Schryver. Thank you for the question.
Gas is very important in the State of Georgia. As I
mentioned earlier, it is fueling an industrial growth that you
just talked about, which is great for the state. Municipal Gas
Authority of Georgia is one of our members and they are very
involved in that effort.
When you talk about electrification, one thing to keep in
mind is right now natural gas is actually the largest source of
electricity generation. It is 40 percent. Renewables are about
20 percent.
And certainly renewables are going to grow, and they should
grow. But at the end of day, when the wind is not blowing and
the sun is not shining, that generation is going to be backed
up by natural gas generation.
So our view is, isn't it a lot more efficient to use that
natural gas directly, as we talked about? It is over 90 percent
efficient from the time you take it out of the ground and get
it to the burner tip. You are only losing 10 percent of that
efficiency.
With electricity you are losing two-thirds of that
efficiency when you take the natural gas out of the ground, get
it to the generation plant, get it over the transmission line,
the distribution line, and to the electric appliance. You are
losing two-thirds of that efficiency.
Our view is it is just more efficient to use it directly.
Mr. Carter. I am almost out of time, Mr. Schryver, but I
would be remiss if I did not mention, and it will probably come
as a surprise to my fellow members and my colleagues here on
the committee, but Georgia, being the number one forestry state
in the country, not only did we use natural gas, but those
forests serve as a carbon sink.
So if you look at the full cycle, then you see that we are
carbon neutral when we are using natural gas.
And with that new information that I have submitted to this
committee, I yield back.
Ms. Castor. Rep. Neguse, you are up now. You are recognized
for 5 minutes.
Mr. Neguse. Thank you, Madam Chair.
Colorado's forests take great umbrage at the championing of
the Georgia forests by my friend from Georgia.
I will say, Mr. Schryver, I appreciated your comment about
renewables. I think you said renewables will go up and should
go up. And I am not sure if my colleagues on the other side of
the aisle would agree with that sentiment, but I appreciate
nonetheless you acknowledging that.
I also will say that I am grateful that some of my
colleagues on the other side of the aisle have seen the light
with respect to energy efficiency and the importance of
promoting and advancing energy efficiency.
I wish they would have translated that newfound passion for
energy efficiency into legislative action, because of course
they have had multiple opportunities over the course of the
last year and a half to show in practice what energy efficiency
means.
The Bipartisan Infrastructure law, just by way of example,
as I am sure each of our witnesses are aware of, included
significant investments in energy efficiency. Unfortunately, I
believe none of my colleagues--with the exception of one of my
colleagues--on the other side of the dais voted for that bill.
But, nonetheless, we hope there will be more opportunities,
as one of our witnesses mentioned, through perhaps a
reconciliation bill this summer, and we will see where the
chips fall.
I thought, Mr. Johnson, your written testimony was very
powerful. And there is a quote here I will just read from it.
``A 2018 report from the ACEEE found that energy efficiency
alone can cut energy use in greenhouse gas emissions in half by
2050.'' Just energy efficiency alone. That is remarkable. And I
would think that could serve as a clarion call for us to take
energy efficiency seriously and to lean in and double down on
the investments that would get us there.
Now, Mr. Schryver, I want to follow up on a question that
my colleague from Oregon articulated during her presentation,
and that was around some of the costs of what you describe as
forced electrification. And I guess I just want to dig in this
a little bit.
So you talk about, you say the nationwide cost to consumers
if we forced natural gas households to switch to electric
appliances would come in at more than $258 billion in your
written testimony.
You are saying if every, all 60 million Americans that have
natural gas appliances, dryers, furnaces, water heaters, et
cetera, if they were all compelled to switch to electric
devices today, that is the cost, in your view.
But of course, as you well know, the life span of a dryer
is 10, 15 years, right? Furnace, you tell me, 15, 20 years,
maybe with the right repairs may go 25. So these appliances are
being replaced every day in America. And this cost I don't
think is a true reflection in that sense. You would agree?
Mr. Schryver. We think the costs of forced electrification
are significant. Appliances will be switched. The transmission
system will have to be upgraded. Generation will have to be
increased.
And as I mentioned earlier, the whole premise behind forced
electrification is to move to a more renewable grid. But at the
end of the day, again, when the wind is not blowing and the sun
is not shining, that generation [inaudible] be backed up by
natural gas.
Mr. Neguse. I hear that you say they are significant. I am
just saying this number, I think you and I both can agree,
nobody is saying that tomorrow every single appliance in the
United States of America would be replaced. So I don't think
this is a fair characterization of the cost.
I hear what you are saying about your argument regarding
the costs being significant. And so over a 10-year period or a
15-year period perhaps you could talk about sort of how much it
would cost over that time frame.
But, in any event, I mean, let's say we will go with your
number, let's say $250 billion over a 10-year period. Do you
know how much the Tax Code subsidizes crude oil and natural gas
today?
Mr. Schryver. I think most energy forms enjoy subsidies of
some form or another.
Mr. Neguse. Sure. I am asking you about natural gas
subsidies.
Mr. Schryver. Most of the natural gas--oh, on the
production side, you know, our members aren't producers.
Mr. Neguse. Understood.
Mr. Schryver. So I can't speak to those.
Mr. Neguse. Understood. It is part of the supply chain. I
am sure you know that by some estimates, conservative
estimates, they range between $18 billion to $20 billion a
year, 80 percent of which would go towards natural gas and
crude oil. You could further allocate that number, but call it
$10 billion, call it $11 billion a year, over the course of 100
years--excuse me, 10 years--$100 billion dollars that we are
spending to subsidize natural gas here in the United States.
I think that is an important part of the equation when you
consider the upfront costs that you have described regarding
the electrification of appliances in the United States, and I
think that is important to keep in mind.
But with that, I see my time has expired. I would yield
back to the Chair.
Ms. Castor. Thank you.
Next up, Ranking Member Graves, you are recognized for 5
minutes.
Mr. Graves. All right. Thank you.
I appreciate y'all's testimony.
Ms. Glover, I really appreciated your comments. I just
thought that they were largely grounded and rational and
thinking about solutions.
One of the things I mentioned in my opening statement that
I just struggle with--and looking at Vladimir Putin, for
example. Again, the guy has no respect for human rights. He
doesn't care about the environment. He doesn't care about
anything. All he cares about is his own ego.
The United States has led the world in reducing emissions.
And, yes, energy efficiency efforts that you promote, it is a
part of that. It is a part of reducing emissions.
How does the United States move forward with some of these
actors, like Russia and China and others, who just don't care?
And like I said before, for every 1 ton of emissions we have
reduced, China has increased by 4.
And so how do we handle sort of the international aspect?
Because we can't change the climate just in the United States.
Whatever happens is going to happen globally.
And so what is your thought on how we address this
international issue when you have countries like that that just
don't care?
Ms. Glover. That is likely the million-dollar question,
Congressman.
Mr. Graves. Or gazillion.
Ms. Glover. Okay, Gazillion-dollar question.
I don't know how you would change someone's mind. But I
think that the United States can demonstrate some real
leadership in efficiency----
Mr. Graves. Sure.
Ms. Glover [continuing]. By doubling down and making the
kind of commitment so that every community, every small-
business owner has not only access to efficiency measures, but
also has the ability to adopt them.
And that ability to adopt them I think is even more
important in some way. That ties to this idea of affordability.
And through that demonstration of that leadership, what you
would hope is that other economies would follow suit. And that
may be the best that we can do.
But in terms of your specific question of how do we
influence a Vladimir Putin, how do we influence a Xi Jinping. I
don't know. I mean, that would be my honest answer. But I don't
think that that should prevent us from doing what we can do in
terms of efficiency here.
Mr. Graves. And one of the things that I like, I think,
largely about your testimony, I am not sure if I am putting
words in your mouth, but I think that you largely kind of
reflect this model of aligning incentives.
And what I mean by that is that, look, it is an incentive.
If I just own a house, it is an incentive for me to be more
energy efficient because I have a lower heating and cooling
bill, a lower electricity bill. Incentives are aligned. And it
makes sense there.
But in many cases we are watching things that are being
done where we are just spending unbelievable amounts of money
and we are not seeing a requisite return on investment. We are
spending money on things that are not providing a return on
investment for U.S. taxpayers and it is concerning for me.
But I just want to tell you that I appreciate your
testimony and your perspective on this.
Mr. Johnson, you seem to express a lot of comments and
concern about affordability, which, again, we represent south
Louisiana, we have some of the highest poverty rates in
America, and this is a big deal for our constituents.
But you also seem to advocate a lot of policies that have
been pushed by states like California, by European nations,
where you have significantly higher energy costs there than we
do in my home state.
And so, I am just curious if you can help me reconcile
that. So if you are pushing things that actually cause higher
electricity bills and pushes people into energy poverty, how
does that line up with your objective of ensuring the
affordability of energy?
Mr. Johnson. It is a good question. I think that one of the
things that we have to be very clear on in understanding this
larger issue of equity and energy efficiency and affordability
is that there are different needs based upon the areas that you
are in.
And, ultimately, when you are trying to address the needs
of communities that have been traditionally left behind, it is
going to require investments larger upfront to get many of
those communities on pace.
So initially, yes, you will see a larger investment, but
what we have to also focus on is: What is the economy of scale
over time? What is the payback on that investment?
And so, if we are looking at it strictly from upfront
costs, then, yes, it is very easy to make that argument. But
what is our rate of return on the back side? Are we making sure
that communities are advancing? Are we making sure that
employment rates are increasing? Are we making sure that
workforce development opportunities are becoming more
diversified? To be able to lift those things, it costs.
Mr. Graves. Thank you.
I am running out of time here. But, Mr. Schryver, I just
want to make note, up in New England we watched where they
prohibited the connection of natural gas pipelines into homes
and others. And we saw them have to get natural gas from
Vladimir Putin to bring into New England to actually supply
those homes.
And I am out of time, but perhaps I will submit a question
for the record for you to share a little bit more information
on that.
Yield back.
Ms. Castor. Rep. Casten, you are recognized for 5 minutes.
Mr. Casten. Thank you, Madam Chair.
And thank you so much for our speakers. I have a deep and
longstanding love affair with energy efficiency, and I
appreciate you all being here to support it. I think by most
measures it is the single largest source of new energy in our
system over the last couple decades, and certainly the biggest
opportunity going forward.
I also think that there has been some confusion in this
hearing. This is the climate committee, sometimes I feel like
we need to remind ourselves of that, and energy efficiency, per
se, is not the jurisdiction of this committee. It is a question
of, are we reducing the greenhouse gas emissions per unit of
useful energy in our homes?
Mr. Palmer and I are in violent agreement. I do not want to
go back to the coal burner in his house. Not just--even if it
was a really efficient coal burner, I wouldn't want that in
your home for all the pollution reasons, and we are supportive
of that transition.
However, by the same logic, if you have a solar panel on
your roof that is only converting sunlight into electricity at
9 percent, and you are using that to keep your stove heated, I
would rather you have that than a 33 percent electric grid
converting natural gas because it is fewer greenhouse gas
emissions and it is less money for consumers.
Mr. Johnson, number one, welcome from Chicago and
representing us well. It is great to see you here.
You have been, I think, a very effective and loud advocate
to make sure that all of our communities have access to cheaper
and cleaner energy.
And as I am sure you are aware, it is a fairly common
practice for a lot of municipal utilities, who in theory should
support a locality's freedom to choose, to actually prevent you
from having access to all those choices. There are 21 states, I
believe, that have legislation now in place that prevents
municipalities from putting any limitations on the use of
fossil gas and new construction.
So I think you will agree. But just for the record, do you
agree that it should be up to local communities to decide what
is best for the people they represent?
Mr. Johnson. Absolutely. I think that there should be, in
looking through the lenses of procedural justice, I think that
we should be able to have a voice and be influential of what we
are doing at the local level that best services that local
community.
Mr. Casten. Thank you. I am glad you agree.
Mr. Schryver, a couple just quick yes or noes.
Do I understand right, APGA is funded primarily by the
membership dues from municipalities?
Mr. Schryver. By community-owned utilities. They are not
just cities, but --
Mr. Casten. No, I understand. But most of your revenue
comes from the funding from municipalities and your memberships
in municipalities?
Mr. Schryver. That is correct.
Mr. Casten. Yes, okay. So then most of your members are
overseen or managed by the democratically elected municipal
government. Yes or no?
Mr. Schryver. The vast majority are regulated by a locally
elected or appointed utility board or city council.
Mr. Casten. Okay. So your industry has referred to your
opposition to greenhouse gas emissions reduction as energy
choice legislation. But doesn't that legislation prevent
democratically elected municipal officials from actually
setting the kinds of local energy policy and code ordinances
for their community that Mr. Johnson would like to see to make
his job better?
Mr. Schryver. You are talking about the 20 states that have
enacted energy choice legislation?
Mr. Casten. I am talking about the policies that you have
been advocating for to prevent municipalities, democratically
elected municipalities, from doing their job.
Mr. Schryver. Sure. And just for the record----
Mr. Casten. Thank you for the yes, because I would like to
submit----
Mr. Schryver. Actually, it is not a yes.
We believe natural gas is in the best interest of consumers
and they should have the right to choose. Natural gas, solar,
these bills don't restrict just natural gas, they leave open
any fuel choice.
Mr. Casten. Well, look, I want to come back to that.
Madam Chair, I would like to submit for the record an APGA
board book that is listing energy choice legislation, as they
call it, which serves as a gas preemption as their number one
policy for 2021.
Ms. Castor. Without objection.
[The information follows:]
Submission for the Record
Representative Sean Casten
Select Committee on the Climate Crisis
April 7, 2022
ATTACHMENT: American Public Gas Association, 25 January 2021,
``2021 Winter APGA Board of Directors Meeting Book.''
The document is retained in committee files and available at:
https://www.documentcloud.org/documents/20959775-2021-winter-
board-book#document/p50/a2093951
Mr. Casten. I want to come back to your last comment there,
Mr. Schryver. I completely agree with your point that in a grid
that is 33 percent efficient and is fueled by gas the choice
between using gas and a 33 percent efficient generator and
sending that through a wire uses less gas, emits less
greenhouse gas emissions than using that same gas if it is a
swap between an electric stove and a gas stove. I take your
point.
We are rapidly electrifying our grid--oh, I am sorry, we
are rapidly greening up our grid. We cannot look our children
in the eye and say that we are doing what we have to do to
provide a sustainable planet unless we electrify massive parts
of our grid and decarbonize the grid. In big parts of our
country, like the Northwest, we are already primarily a
renewable grid.
Does your industry advocate, in the name of our children,
in the name of our environment, in the name of people's wallets
in those parts of country that have a lower carbon grid, to
make sure that people have access to those? Or is it just about
selling the gas?
Mr. Schryver. First of all, on the natural gas side, since
1990 we have reduced emissions by approximately 70 percent.
Mr. Casten. I am asking a different question. In a grid
that does not have--that does not depend on 33 percent
efficient fossil fuel plants--and, yes, that is the grid we
have had since 1957. It is not the grid we want to give our
children. We owe them better.
As we transition, is it still about the gas or is it about
giving ourselves a better planet?
Ms. Castor. The gentleman's time has expired.
Mr. Casten. I yield back.
Mr. Schryver. It is about--oh, I am sorry.
Ms. Castor. Next up, Rep. Crenshaw. I see you virtually.
You are recognized for 5 minutes.
Mr. Crenshaw. Thank you, Madam Chair.
I would say what we owe our children is prosperity and
energy reliability. And, as of now, there are only three things
that offer that: gas, coal, and nuclear energy.
I yield the remainder of my time to the Representative from
Louisiana, Garret Graves.
Mr. Graves. Thank you. Thank you, Mr. Crenshaw.
Mr. Schryver, I want to continue the line of questioning
before.
So you have a situation where you have people, and Ms.
Glover brought this up before, giving consumers choice. But you
have governments that are coming in and actually blocking or
preventing access to your technology, your gas, in some cases.
So when they didn't have the access to gas, they brought in
home heating oil, which of course has higher emissions, less
efficient and more expensive, and then they had to bring in gas
from Vladimir Putin from Russia.
Could you just reflect on the impacts to consumers and the
environment and what it does to global security when you have
policies like that that are so shortsighted?
Mr. Schryver. When you have a capacity constrained area,
like we have seen in Massachusetts, and consumers want natural
gas, because it is cleaner, it is more affordable, it is more
resilient, and they can't get it, they are heating their homes,
because, as you know, Massachusetts has a tough winter, with
heating oil or propane, both of which are much more expensive
and have a greater environmental footprint than natural gas.
Mr. Graves. So, Madam Chair, I would like to ask unanimous
consent, an April 5 article from E&E News, ``Surging electric
bills threaten California climate goals.''
Ms. Castor. Without objection.
[The information follows:]
Submission for the Record
Representative Garret Graves
Select Committee on the Climate Crisis
April 7, 2022
ATTACHMENT: Mulkern, A. C., 5 April 2022, ``Surging electric bills
threaten Calif. climate goals,'' E&E News.
This article is retrained in committee files and available at:
https://www.eenews.net/articles/surging-electric-bills-
threaten-calif-climate-goals/
Mr. Graves. Thank you.
Another question. Under the Biden administration, they
projected that global energy demand is going to go up 50
percent--50 percent--between now and 2050. And that means, yes,
more renewables, and it means an increase in every energy
source, wind and solar and wave and geothermal--and oil and
gas.
Let me say this again: The Biden administration's
projections show an increase in demand for all energy sources.
In fact, for developing countries, depending on economic
scenario, as much as an 80 percent increase in natural gas
demand.
So the Biden administration, the first--or one of the first
actions they took was an executive order to ban new energy
production--to ban new energy production. So you are not
cutting off demand, you are just cutting off domestic supply.
So what happens in a scenario like that? And I know you are
not an expert on the upstream side, but what happens in a
scenario like that?
Mr. Schryver. You know, we have experienced it, last year
with Storm Uri. When you have instances where demand increases
and supply decreases, consumers are hit with high energy
prices.
Mr. Graves. So consumers are hit with higher prices because
you have a lack of supply to meet demand. But then also you
have a scenario where other countries, like, I don't know,
Vladimir Putin, comes in and backfills the lack of production
in the United States.
It was said a few times today, the U.S. has some of the
most efficient, some of the cleanest production in the world.
If the Biden administration is even projecting that there is
going to be a 50 percent global increase in energy demand, why
would we not fill it domestically where we do it safer, we do
it cleaner, it creates economic activity here, it doesn't fund
bloodshed like we are seeing in Ukraine right now?
Does that make sense to any of you? To any of you, does
that makes sense why we wouldn't produce energy here when even
this administration is saying there is an increase in demand?
And by not doing it, as Mr. Schryver said, it results in higher
prices, it results in funding authoritarian regimes?
Look, I am all for energy efficiency, I am, because, like
you said, Ms. Glover, the incentives are aligned. If we can pay
lower electricity bills and it costs us less money to build
widgets in the United States, that is great. It is good for all
of us.
But if we are just going to push solar and wind and what
other pixie dust technology and we haven't thought through the
supply chain and we are going to trade buying energy from
Vladimir Putin to saying we are going to get critical minerals
and rare earths from China, who then is going to use the money
against us as well?
We have got to think through the supply chain strategies
here to make sure that we can actually achieve these goals in a
way that is consistent with U.S. interest. Does that make
sense? Do any of you object to domestic energy production, to
meeting the demand?
Madam Chair, let the record reflect no one objects,
apparently.
Yield back.
Ms. Castor. I want to thank all of our witnesses for being
very efficient today with their time.
You have given us a lot of good advice on how to lower
energy bills for consumers at home. And we hear you loud and
clear: Using energy efficiency and all of these innovative
tools also helps reduce greenhouse gases that are creating
escalating costs for consumers.
And that is the reality we face. And, in fact, the world's
top scientists, again, if you haven't dug into their report
released just on Monday, say that we must--must--find these
clean energy solutions quickly and urgently.
We cannot continue to double down on costly fossil fuels.
We need to stand up to the petro despots across the globe and
break this addiction to fossil fuels.
And the best way to do that, the most efficient way to do
that is through energy efficiency, the energy of the jobs that
are created right here in America that are abundant and ready
to be deployed--not just lip service to energy efficiency, but
actual votes, policy, and resources provided to our neighbors
back home.
So with that, thank you all very much. The committee is
adjourned.
[Whereupon, at 10:30 a.m., the committee was adjourned.]
United States House of Representatives
Select Committee on the Climate Crisis
Hearing on April 7, 2022
``Cost-Saving Climate Solutions: Investing in Energy Efficiency to
Promote Energy Security and Cut Energy Bills''
Questions for the Record
Paula Glover
President
Alliance to Save Energy
the honorable kathy castor
1. How would the energy efficiency investments in the Bipartisan
Infrastructure Law, such as the $3.5 billion for the Weatherization
Assistance Program, funding for energy code adoption, and grants for
schools and non-profits help advance energy efficiency across the
nation? How would the House-passed climate investments build on that
foundation?
The residential and commercial built environment represent
approximately 40% of U.S. carbon emissions. Funding through the IIJA to
support the Weatherization Assistance Program (WAP), grants for energy
efficiency improvements in non-profits and public schools, and similar
investment opportunities directly address the need to reduce emissions
and respond to climate priorities. That said, additional and
substantive investments in energy efficiency are required if we are to
meet the urgent need. This includes but is not limited to additional
WAP funds, and resources to support WAP readiness.
That said, federal investments proposed in budget reconciliation
that are now part of the House-passed legislation are essential if we
plan to move the ball forward. Key funding provisions include the
energy efficiency tax incentives 25C, 45L, and 179D; Hope for Homes;
critical facilities modernization; climate bank provisions, and others.
Unfortunately, the critical facilities modernization provision in the
House-passed measure is substantially reduced when compared to the Open
Back Better legislation (H.R. 1485) on which the provision is based.
The House-passed measure would provide $500 million versus the $18
billion proposed in H.R. 1485.
2. Could you please describe the role of appliance and equipment
standards in furthering energy efficiency, energy cost savings, and
reducing carbon pollution? What are some examples?
Appliance and equipment standards play an essential and critical
role in reducing carbon emissions, and in fact, appliance standards and
labeling alone avoid 343 metric tons of carbon emissions a year.
Currently, the administration has a large task with some 100 plus
rulemakings not yet completed, which could save consumers billions over
the next 3 decades, while also lowering energy costs and carbon
emissions.
That said, in addition to establishing clear standards to drive
market penetration of high efficiency equipment and appliances, the
Alliance recommends that policy makers also respond to concerns related
to affordability and access. While we definitively want consumers using
the most efficient product types, if they are unable to afford the
equipment or retrofit, then the benefits of emission reductions and
energy cost savings are avoided. Although high efficiency appliances
and equipment repay the consumer over the life of the product, often
when affordability is an issue, consumers make their purchase decisions
based on exiting daily and monthly living expenses. To help address
this issue, policy makers should support additional funding for the
Weatherization Assistance Program (WAP), expansion of the energy
efficiency tax incentives (25C, 45L, and 179D), and programs like Hope
for Homes.
3. What are some additional Federal energy efficiency policies that
could help reduce consumer energy bills and help achieve our national
climate goals?
Energy efficiency tax incentives are an important tool to drive
greater energy efficiency adoption, with specific attention to sections
25C, the tax credit for homeowners making efficiency upgrades; 45L, the
credit for single-family and multi-family development; and 179D, the
deduction for commercial buildings.
That said, many consumers do not itemize and are otherwise left
without an incentive to drive efficiency investments. Hope for Homes,
legislation that is part of the budget reconciliation bill that passed
the House is idea for these homeowners, and provides a rebate when
achieving identified efficiency levels.
Climate banks can also be effective tools in driving energy
efficiency investments for consumers, and budget reconciliation as
passed by the House provides $11.970 billion for climate bank activity
and an additional $8 billion for the rapid deployment of low and zero-
emission products, technologies, and services, specifically targeting
financial and technical assistance in low-income and disadvantaged
communities.
The Alliance would also recommend funding pathways to incentivize
energy efficiency investments in small businesses, as provided in HR
4903, the Main Street Efficiency Act. Small businesses often lack the
resources to prioritize energy efficiency, however once solutions are
deployed, owners are able to identify significant business savings. HR
4903 would provide grants to utilities that operate demand side
management programs, and leverage those funds to provide reduced or no
cost retrofits for the small business enterprise.
4. In your testimony, you mentioned that energy efficiency
investments are essential to improving electric grid reliability as we
continue to electrify homes, businesses, and vehicles. Could you please
describe in additional detail how energy efficiency investments can
complement upgrading and expanding the electric grid? How can energy
efficiency help unlock a path towards a cleaner and more reliable grid?
As indicated in written testimony, investments in energy efficiency
are essential to the reliability of the electric grid. This is
particularly true as policy and markets shift a substantive share of
energy demand toward electrification. Based on analysis and depending
on the rate of electric vehicle (EV) adoption, we should anticipate
significant future growth in grid load.
According to the Brattle Group, if the projected rate of EV growth
increases from 1.5 million in 2020 to 10-35 million by 2030, we will
need grid investments up to $125 billion across the electric power
sector--and that's to serve 20 million EVs.\1\ These vehicles will add
60-95 terra-watt hours (TWh) of electricity demand to the grid
annually, in addition to 10-20 gigawatts (GW) of peak load, which in
turn would require 12-18 gigawatts of generation capacity from
renewable energy.\2\
---------------------------------------------------------------------------
\1\ https://www.brattle.com/insights-events/publications/electric-
power-sector-investments-of-75-125-billion-needed-to-support-projected-
20-million-evs-by-2030-according-to-brattle-economists/.
\2\ Id.
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Energy efficiency directly reduces demand on the grid through
efficient products and equipment that have lower energy intensity and
still perform the same or better as a less efficient equipment or
product type. A most common example would be the use of an incandescent
light bulb versus an LED. LEDs in general use more that 75% less
energy. As grid load decreases through energy efficiency we also
increase the ability of the grid to provide power to customers and
businesses without interruption. Additionally, ``during power
interruptions, lower loads due to energy efficiency measures allow more
customers to be switched across feeders for faster restoration time.''
\3\
---------------------------------------------------------------------------
\3\ https://eta-publications.lbl.gov/sites/default/files/
ee_reliability_resilience_2021_12_03.pdf.
---------------------------------------------------------------------------
Energy efficiency's positive impact on grid reliability and its
ability to lower load and infrastructure investment costs, also make it
possible to integrate more renewable capacity onto the grid faster.
Researchers already appreciate the variability of renewable energy and
the limited capacity of storage technologies, and see energy efficiency
as a necessary compliment to a cleaner grid.\4\
---------------------------------------------------------------------------
\4\ https://aip.scitation.org/doi/10.1063/5.0064570.
5. In your testimony, you describe ``active efficiency.'' How could
active efficiency opportunities support better resilience to climate
impacts like the extreme heat waves in the Pacific Northwest last
---------------------------------------------------------------------------
summer?
Active Efficiency technologies would include solutions such as
grid-interactive efficient buildings, smart buildings optimization and
analytics, and use of distributed energy technologies that allow
building systems to shift, share, and shed load, including direct links
to light and heavy vehicles. As Active Efficiency technologies are
added into the energy efficiency equation, overloading and wear and
tear on the grid are reduced significantly, reducing the likelihood of
equipment failure.\5\
---------------------------------------------------------------------------
\5\ Id.
6. Could you please describe how innovation in industrial energy
efficiency could help save money for businesses while also reducing
carbon pollution? Which Federal investments could facilitate greater
---------------------------------------------------------------------------
innovation in industrial energy efficiency?
Industry and manufacturing account for 24% of U.S. GHG
emissions.\6\ As a result, any viable strategy to reduce overall
emissions must include industry energy efficiency.
---------------------------------------------------------------------------
\6\ https://www.epa.gov/ghgemissions/sources-greenhouse-gas-
emissions.
---------------------------------------------------------------------------
When talking about energy efficiency in the industry and
manufacturing context, we are targeting the equipment used, operations
and process, and the application of smart manufacturing technologies.
The end game is to optimize manufacturing and industry systems in a way
that achieves the highest efficiency outcomes. In application, this
means deployment and utilization of multiple solutions, including but
not limited to distributed energy resources, carbon capture,
electrification, low-emission fuel technologies, and storage. From an
equipment and operations perspective, relevant solutions would include
high efficiency motor systems, combined heat and power, strategic
energy management, and others.
Federal investments that could be useful in driving energy
efficiency include funding to support Industrial Assessment Centers,
incorporating First Three \7\-- applications of transformative
industrial technologies; Flex-Tech \8\--DOE funding for states to
create a version of the successful energy saving NY program; and
Commercial Deployment of Efficient Technologies \9\--building on the
Clean Industrial Technologies Act provisions of the Energy Act of 2020.
---------------------------------------------------------------------------
\7\ https://amendments-rules.house.gov/amendments/
CASTOR_050_xml220128155220265.pdf.
\8\ https://amendments-rules.house.gov/amendments/
TONKO_053_xml220128093201458.pdf.
\9\ https://amendments-rules.house.gov/amendments/
DOYLE_018_xml220129124931674.pdf.
7. How could Federal energy efficiency investments promote American
energy security? Could increased energy efficiency help reduce demand
---------------------------------------------------------------------------
for globally traded fossil fuels with volatile prices?
Energy efficiency investments reduce energy intensity throughout
all sectors of the U.S. economy -- including manufacturing,
transportation, in agriculture, and the built environment. In fact, but
for investments made in energy efficiency since 1980, energy
consumption would have been more than 60% higher.\10\
---------------------------------------------------------------------------
\10\ https://energyefficiencyimpact.org.
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As we make investments in energy efficient products, equipment,
supplies, and technologies-- and as consumers and businesses adopt
efficiency solutions, energy consumption is reduced, and generation and
production supplies are offset through lowered demand. This is achieved
by investments that secure the building envelope, equipment standards,
building codes, building design, and establishing policies that
prioritize energy efficiency as a primary part of U.S. domestic energy
policy. If we are using less energy as a result of energy efficiency,
we are also using less supply-- reducing the need for larger and larger
amounts of energy production.
the honorable mike levin
1. The United States has a long history of developing fuel economy
standards. President Ford signed the first standards into law in 1975
in response to the 1973 oil embargo by Arab nations in protest to U.S.
support for Israel during the Yom Kippur War. These fuel standards,
along with subsequent updates, have cut American oil consumption by 25
percent, or nearly 2 billion barrels a year. Strong fuel economy
standards strengthen U.S. energy independence and help reduce reliance
on fossil fuels, particularly from foreign nations. Unfortunately, the
previous Administration sought to weaken these fuel economy standards
and limit the ability of states like California to set their own
emissions rules. According to Consumer Reports, each vehicle sold under
the Trump rule would have cost its owner on average $2,100 dollars more
due to increased gas costs. Thankfully, the Biden Administration has
reversed this decision--last week, the Department of Transportation
office released new fuel efficiency standards for vehicles, increasing
fuel economy to a fleetwide average for new vehicles of 49 miles per
gallon by 2026. As a result, Americans purchasing new vehicles in 2026
will get 33 percent more miles per gallon as compared to 2021 vehicles.
This means new car drivers in 2026 will only have to fill up their
tanks three times as compared to every four times that new car drivers
today do for the same trips. This rule is expected to save 234 billion
gallons of fuel through 2050. Can you talk about why these strengthened
fuel efficiency standards, along with parallel investments in electric
vehicles, are good for both consumers and the environment?
Fuel economy standards and electric vehicle deployment directly
reduce demand for oil and gas supplies thus reducing the levels of
carbon emissions that would be emitted from less efficient vehicle
types. Additionally, fuel economy standards lower the cost of energy
for consumers in that they are traveling further while burning or using
less fuel. The efficiency impact of electric vehicle (EV) technology as
an alternative is much greater. EVs convert up to 77% of the charged
energy to the vehicle and braking systems versus 12%-30% for vehicles
powered by gasoline.\11\
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\11\ https://www.fueleconomy.gov/feg/evtech.shtml.
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Questions for the Record
Darnell Johnson
President and CEO, Urban Efficiency Group; and Vice Chair,
Building Performance Association
the honorable kathy castor
1. How would the energy efficiency investments in the Bipartisan
Infrastructure Law, such as the $3.5 billion for the Weatherization
Assistance Program, funding for energy code adoption, and grants for
schools and non-profits help advance energy efficiency across the
nation? How would the House-passed climate investments build on that
foundation?
The energy efficiency investments included in the Infrastructure
Investment and Jobs Act (IIJA), signed by President Biden on November
15, 2021, will support a number of crucial residential energy
efficiency programs. As you noted, IIJA included an historic $3.5
billion in funding for the Weatherization Assistance Program, which
focuses on bringing energy efficiency to communities that need it most
and improving home performance for low-income households. These
investments will not only lower utility bills and reduce greenhouse gas
emissions but will also improve occupant comfort and health \1\ in
underserved communities that have historically been left behind. With
rising energy prices stemming from Russia's war in Ukraine, these high-
energy-burden communities have suffered disproportionately--so this
historic investment could not come at a more important time.
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\1\ https://e4thefuture.org/occupant-health-benefits-of-
residential-energy-efficiency/. As I noted in my initial testimony,
this report from E4TheFuture, entitled ``Occupant Health Benefits of
Residential Energy Efficiency'' which reviews existing research on the
link between resident health benefits and energy efficiency upgrades,
found that residential energy efficiency upgrades can produce
significant improvements in asthma symptoms and help improve overall
physical and mental health.
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Additionally, IIJA included other funding to drive additional
energy efficiency adoption, including: $550 million for the Energy
Efficiency and Conservation Block Grant Program (EECBG) to support
implementation of energy audits and retrofits to improve both
residential and commercial energy efficiency; $500 million for grants
for energy efficiency and renewable energy improvements at public
school facilities; $250 million to support an energy efficiency
revolving loan fund for residential and commercial buildings; and $225
million to enable sustained, cost-effective implementation of updated
building energy codes within the DOE Building Technologies Office
(BTO). These programs will all drive demand for energy efficiency
upgrades in buildings across the country, including in homes,
businesses, and schools.
While the historic investments from IIJA--in WAP in particular--
will improve home performance in underserved communities, this funding
alone is not enough. One key issue facing WAP is that many low-income
homes have other issues--such as structural deficiencies, and health
issues such as mold and asbestos--that have to be addressed before they
are eligible for WAP. Nationally, 10-30% of income-eligible
weatherization clients are deferred because of one or more of these
problems.\2\ We need to address these health and safety issues so that
this backlog of homes can become eligible for the program. Many
deferred income-eligible weatherization clients are located in low-
income, historically disadvantaged communities--the very same
communities facing disproportionately high energy burdens and health
risks.
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\2\ https://e4thefuture.org/wp-content/uploads/2022/04/E4-
EFG_Weatherization-Barriers-Toolkit-4-7-2022.pdf.
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I was pleased to see the enacted Fiscal Year 2022 Appropriations
package appropriate $15 million for a Weatherization Readiness Fund to
address these issues, and I applaud the leadership of Sen. Reed (D-RI),
Sen. Collins (R-ME), Sen. Coons (D-DE), and Sen. Shaheen (D-NH) in the
Senate for introducing legislation (S. 3769, the Weatherization
Assistance Program Improvements Act of 2022) to authorize this FY22
appropriation and support potential additional appropriations in FY23.
Congressman Tonko (D-NY-20) is leading the effort on the House side,
and I hope Chairwoman Castor and the other members of this committee
will consider supporting Congressman Tonko's bill upon introduction
President Biden requested $30 million in his FY23 budget for the
Weatherization Readiness Fund, and the Building Performance Association
(in conjunction with E4TheFuture) submitted FY23 appropriations
requests to both House and Senate offices in support of $37.5 million
for the fund.
Beyond these weatherization readiness issues, access and awareness
challenges in underserved communities are also critical barriers to
broader adoption and program success. As I mentioned in my testimony
before the committee, to connect with hard-to-reach populations, we
must first listen to them. To do otherwise stymies information sharing,
limits participant enrollment in energy efficiency programs, and
exacerbates the divide between those participating in the fight to
address climate change, and those forced to remain on the sidelines.
The House-passed climate investments from last year's Build Back
Better package would make crucial investments in residential energy
efficiency via both direct funding and tax credits (including an
expanded and extended 25C residential energy efficiency tax credit).
Most notably, the HOPE for HOMES Act, included in the package that
passed the House last fall, would provide funding to small businesses
for training contractors in new skills and rebates to homeowners for
upgrading their home's energy performance (doubling rebates for middle-
and lower-income Americans). I applaud Chairwoman Castor for her
leadership cosponsoring HOPE for HOMES and ensuring its inclusion in
Build Back Better, and I thank her for her continued advocacy in
support of this bill this year.
2. Could you please share one or two specific insights from your
on-the-ground experience on how energy efficiency improvements have
helped families enjoy a higher quality of life?
Our firm's work is largely performed in disinvested, economically
challenged communities. The disparities associated with this demography
include, but are not limited to, limited access to information and
resources resulting in them being placed in the ``hard to reach''
category. Respecting the customer's confidentiality, I'm going to use
``Mrs. Jones'' to reference the customer experience. Mrs. Jones lives
on the Southside of Chicago and happened to be home the day our firm
was providing retrofit work for her neighbor. She inquired about the
work and wanted to know how she could receive the services and
associated cost. After explaining to her the benefits of living in an
energy efficient home (cost savings, comfort, and health and safety),
she was sold. She was connected to the program administrator and, when
she was approved to receive the services at no cost, she was ecstatic.
During the energy audit, it was discovered that Mrs. Jones had
asbestos in her attic that was disturbed, and a furnace that was over
30 years old with a cracked heat exchanger. Additionally, due to the
age of the furnace and neglected maintenance, the furnace was
contributing to higher levels of CO2 in the home, creating
an additional health and safety risk. The presence of asbestos in the
attic would have caused the retrofit services to be deferred until the
asbestos was remediated, but our firm was able to leverage our social
capital to get the asbestos remediated ($8500.00) at no cost to the
homeowner. This action allowed the retrofit work to proceed as planned.
The value add to the customer is as follows:
1. She was made aware of the energy efficiency program offerings.
2. She was educated on the benefits of living in an energy
efficiency home.
3. She received the retrofit upgrade to enjoy cost savings,
increased comfort, and remedied the health risks.
4. She received a brand new furnace.
5. She became an ambassador for the program and energy efficiency
more broadly.
6. She remains an advocate for our work, energy efficiency, and
participates in our referral program to get new customers enrolled.
7. We have experienced a 35% increase in customer participation
from that community year over year.
There are many examples of ``Mrs. Jones'' in low- and middle-income
communities across the country--folks who need critical home energy
upgrades, but face other issues--including structural deficiencies and
health issues such as mold and asbestos--that must be addressed before
they are eligible for key programs like WAP. These important
``readiness'' upgrades would be supported by the Weatherization
Readiness Fund, mentioned in more detail above under Question #1.
3. In your testimony, you mention the need to deliver reliable
energy services at lower costs. What kinds of investments will help
ensure equitable access to reliable and affordable electricity?
Significant investments in energy efficiency and an expanded energy
efficiency workforce, with a particular emphasis on underserved
communities, can help ensure equitable access to reliable and
affordable electricity--while also creating jobs, reducing demand on
the electric grid, lowering household utility bills, cutting greenhouse
gas emissions, and improving energy independence. As I noted in my
testimony to this committee, deploying energy efficiency reduces demand
for primary energy and generating capacity needs and therefore lowers
the overall costs of shifting to a low-carbon energy system. Energy
efficiency is cleaner and cheaper than building new low-carbon or
carbon-free energy generation resources.
Nowhere is this need clearer than in residential buildings. In
2021, residential buildings accounted for 21% of total U.S. energy
consumption.\3\ Unlike other sectors of the economy, the residential
sector is notoriously difficult to address, with approximately 140
million housing units nationwide \4\ that make up a patchwork of
varying household income levels, awareness, and access to key energy
efficiency solutions. These circumstances make the residential sector
particularly challenging to decarbonize. Policies like the rebate
program contained in the HOPE for HOMES Act (H.R. 3456) would expand
access to more affordable residential energy solutions, particularly
via larger rebates available for middle- and lower-income homeowners,
leading to more affordable electricity and energy bills. Additional
training funding included under HOPE for HOMES would also expand
training opportunities for contractors, growing and diversifying the
energy efficiency workforce.
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\3\ https://www.energy.gov/sites/prod/files/2019/04/f61/bto-
geb_overview-4.15.19.pdf
\4\ https://www.census.gov/quickfacts/fact/table/US/HCN010212.
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The cost to upgrade a home's energy efficiency is growing, as are
the costs for contractors to carry out these upgrades. The pandemic-led
workforce shortage and supply chain constraints have driven these price
increases, making it less likely that a homeowner will make those
investments without federal subsidies providing the incentives. These
upgrades are even more cost-prohibitive for lower-income homeowners,
underscoring the crucial importance of rebate proposals like HOPE for
HOMES.
4. How should Congress ensure that all communities, including
environmental justice communities, are included in climate policy
development and benefit from the transition to a clean energy economy?
Could you please elaborate on why it is important for communities to
have a seat at the table when Federal, state, and local governments are
exploring climate solutions?
Traditionally, BIPOC communities are the last to adopt emerging
energy efficiency technologies. This delay should not be interpreted as
a lack of interest, but rather reflects existing barriers to adoption
(awareness, access, and affordability). The top-down approach usually
causes an information gap, leaving social identity groups that are
considered the ``outgroups'' with limited or late information. We can
close this gap by adopting Procedural Justice \5\ best practices, to
ensure policies are equitable and require the inclusion of diverse
perspectives. Those perspectives should be shared by the stakeholders
and thought leaders that have the ``lived experience'' and understand
the challenges and needs of the demography they represent. It's not
enough for these communities to just be at the table--their
perspectives should inform and influence the policies being drafted in
a way that is equitable. The existential threats are too great to
continue transactional policy making. We need to embrace diversity,
prioritize inclusion, and demand transformative policy making that
serves the greater good of humanity.
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\5\ Procedural justice--Wikipedia
5. Energy efficiency can be complementary to other climate
solutions like rooftop solar energy. Could you please describe the
holistic approach your firm has taken to helping families benefit from
complementary climate solutions? What lessons could we draw for Federal
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policy development?
At Urban Efficiency Group (UEG), we are focused on advancing energy
equity by all means necessary. While we are fully supportive of
decarbonizing our electric grid and shifting to renewable energy
sources, we must also recognize the significant equity issues that can
arise from electrification, particularly in the absence of proper
information and awareness in our most underserved communities. We must
first focus our attention on providing these communities with accurate
and straightforward information about what fuel switching entails--the
benefits to health and the environment but also the costs--both short
and long term. We should not, and cannot, expect our low- and moderate-
income communities to absorb the cost of fuel switching. In the example
of rooftop solar energy, many of the low- and moderate-income homes we
serve do not have the rooftop integrity to support PV arrays, and still
lack needed weatherization, health, and structural measures (which
could be addressed via the Weatherization Readiness Fund, as mentioned
in more detail above under Question #1).
We must also recognize that various mechanisms bringing renewable
energy sources to underserved communities--for example power purchase
agreements--can also present equity issues in terms of asset ownership
and profitmaking. We must make sure to shape policy in a way that can
bring low-carbon energy to our underserved communities while also
helping these communities increase resiliency and human capital, not in
a way that leads to continued/renewed exploitation.
While Congress works to get those policies crafted, we should be
focusing primarily on energy efficiency. As I mentioned in my written
testimony submitted to the committee, the cleanest and the cheapest
energy is the energy you don't use in the first place. A 2019 report
from the American Council for an Energy-Efficient Economy (ACEEE) found
that energy efficiency can cut GHG emissions by about 50 percent by
2050.\6\ Buildings deliver 33% of the total emissions reductions in the
report's model, and upgrades to existing buildings, homes, appliances,
and equipment are identified as some of the largest cost-effective
opportunities to achieve these reductions.
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\6\ https://www.aceee.org/fact-sheet/halfway-there.
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We have seen these savings firsthand at UEG, and the on-the-ground
success of deploying these energy efficiency measures offers important
lessons for Federal policy development: energy efficiency is a vastly
untapped resource that our communities can unleash--with adequate
financial support and a focus on equity. Initial investments from the
Infrastructure Investment and Jobs Act, and further proposals like the
HOPE for HOMES Act contained in the House-passed Build Back Better
package, can bring crucial energy efficiency measures directly into
millions more homes in the communities where they are needed most.
Importantly, a holistic approach to helping our most vulnerable and
underserved communities must involve not just clean energy and energy
efficiency investments, but investments to grow the human capital in
these communities via well-paying clean energy and energy efficiency
jobs, with particular attention to diversity, equity, and inclusion.
Like many trades, the energy efficiency industry has historically been
a white, male-dominated industry.\7\ There is a real need to focus on
training and workforce development that incentivizes greater diversity
and equity, prioritizing minorities and women for training. Residential
energy efficiency businesses--the vast majority of which have fewer
than 25 employees--are crucial to our communities, providing local jobs
that cannot be outsourced. They know how to do more with less and
should have equal access to funding sources to bring on local workers
and train them for growing demands. Supporting small businesses will
generate economic growth and could help avoid unintentional exclusion
of communities of color who have been historically overlooked by unions
who may not have deep ties to these specific communities, thus opening
opportunities to expand workforce diversity and allowing local
communities to build and maintain human capital.
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\7\ According to the 2021 Energy Efficiency Jobs in America report,
a large majority of workers in the US energy efficiency industry are
white males.
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Chairman Rush's Blue Collar and Green Collar Jobs Act (HR156) will
be crucial to building this workforce. The bill includes an important
Energy Workforce Grant Program and I urge the members of the Select
Committee to co-sponsor this important legislation. I elaborate further
on the importance of this bill in the question below.
the honorable mike levin
1. According to Department of Energy estimates, households
participating in the Weatherization Assistance Program save on average
$372 dollars each year. Not only will this funding provide critical
assistance to low-income households, but it will also help grow the
energy efficiency job sector. This sector already employs 2.1 million
people, more than twice as many workers as work in the entire U.S.
fossil fuel sector. That is why I am also glad that the bipartisan
infrastructure law recognizes the need to recruit and train more
Americans for careers in this sector by including $10 million dollars
for energy efficiency career skills training grants. Can you talk about
why it is important to pair energy efficiency program investments with
parallel investments in developing the energy efficiency workforce?
Pairing energy efficiency program investments with investments in
the energy efficiency workforce is critical--one cannot fully advance
without the other. I was pleased to see funding for energy efficiency
career skills training grants included in the Infrastructure Investment
and Jobs Act (IIJA), but much more support is needed, as that funding
focuses on non-residential sectors. As I noted in my testimony before
this committee, the costs associated with training, equipment, and
certifications are often steep, and constitute significant barriers to
expanding and diversifying the energy efficiency workforce. Like many
trades, the energy efficiency industry has historically been (and
remains) a white, male-dominated industry.\8\
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\8\ https://e4thefuture.org/wp-content/uploads/2021/10/Energy-
Efficiency-Jobs_2021_All-States.pdf.
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Directly pairing investments in energy efficiency with workforce
investments is smart strategy, and there is legislation that would do
just that. The HOPE for HOMES Act (H.R. 3456) pairs workforce training
grants with a direct rebate program for homeowners to ensure workforce
needs are met alongside critical home performance upgrades. A budget
reconciliation version of HOPE for HOMES was included in the Build Back
Better package that passed the House last year. Thank you for your vote
of support for HOPE for HOMES in this reconciliation package, and I
urge you to continue supporting this bill during legislative
negotiations this year. The ``HOPE'' training will help small
businesses make investments in their workers that they are currently
disincentivized to do as the workforce is unstable and the fear of
losing a newly trained employee challenges those investments. By
subsidizing this training, we are ensuring that both the work is done
well and that small businesses embrace the training as a part of
business, raising the education level and expertise of the industry.
Additional federal investments via legislation like the above-
mentioned Blue Collar and Green Collar Jobs Development Act (HR 156)
can increase the contractor diversity in the energy efficiency sector
and create a more diverse workforce. That legislation, sponsored by
House Energy & Commerce Energy Subcommittee Chairman Bobby Rush (D-IL-
01) includes a vital Energy Workforce Grant Program that provides
grants directly to small businesses, among others, to support on-the-
job training and external training of employees in the clean energy and
energy efficiency industries, with an emphasis on minority and women-
owned businesses. Small residential energy efficiency businesses like
ours, the Urban Efficiency Group (UEG), are the perfect vehicles for
this workforce funding--we know how to do more with less. Supporting
small businesses will generate economic growth and could help avoid
unintentional exclusion of communities of color who have been
historically overlooked by unions who may not have deep ties to these
specific communities, thus opening opportunities to expand workforce
diversity and allowing local communities to build and maintain human
capital. I urge the members of this Select Committee to co-sponsor this
important legislation and hope to see it passed before the end of the
117\th\ Congress.
As I mentioned in my written testimony before the committee, our
firm, UEG, developed a quasi-small business incubator (Energy+) to
remove some workforce cost barriers and increase supplier diversity.
This comprehensive approach to developing and deploying more minority
business enterprise (MBE) firms in the energy efficiency space, or
``business in a box'' concept was successful in launching two (2)
minority owned energy efficiency contracting firms that boast a six-
figure net profit year over year.
2. What efforts are you working on to build the future of the
energy efficiency workforce and how can your experiences inform our
work here in Congress?
We are vested in solving the challenges of an illiquid clean energy
workforce by localizing training opportunities for diverse
participants. Additionally, we understand the workforce challenge will
continue as we are losing practitioners through attrition. This
challenge has influenced the creation of a training program for high
school students, to provide early exposure and engagement to the energy
efficiency and home energy performance industry. Our youth initiative,
Green Generation, is entering its second year and we have experienced
an increase in enrollment. This program not only focuses on energy
efficiency, but also includes leadership training, advocacy, and
sustainability. Upon high school graduation, the students will have
secured six Building Performance Institute certifications, qualifying
them to enter the clean energy workforce immediately if college is not
the plan after high school. The impact of this program was covered by
the Department of Energy in an article here.\9\ I believe it is
imperative that Congress considers making larger investments in youth
focused clean energy programs to ensure the next generation leaders are
prepared to enter these emerging markets.
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\9\ https://www.energy.gov/eere/wipo/articles/eere-success-story-
building-green-generation-chicago.
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Questions for the Record
Dave Schryver
President and CEO
American Public Gas Association
the honorable garret graves
1. Mr. Schryver, as I mentioned in our hearing, I am really
concerned that the energy policy decisions that some states and regions
of the country are making will have negative consequences for
consumers. For example, in New England, the permitting and regulatory
structures in place often makes it difficult to obtain natural gas--
some states like New York have even sought to ban it.
a. How does limiting access to natural gas impact consumers?
As discussed in my testimony, data from the Energy Information
Administration continues to demonstrate that natural gas is the most
affordable way to heat a home, and a recent study commissioned by the
American Gas Association found that the average home that uses natural
gas for cooking, heating, and clothes drying saves $1,000 a year
compared to a home using electricity for those functions. When
consumers are unable to choose natural gas for their homes, they are
denied those savings.
In colder climates, this oftentimes means households are forced to
rely on propane or heating oil to stay warm in the winter. This leads
not just to higher energy bills, but also to a larger environmental
footprint as these fuels produce higher emissions than natural gas.
2. Mr. Schryver, during our hearing, you were asked about the 20
states around the country that have enacted energy choice legislation.
a. How important is consumer choice when it comes to fuel
sources to heat and power their homes--whether it's natural
gas, solar power, or another fuel source? Please explain.
APGA and our members believe consumer choice is vital. As
referenced in my response to the previous question, using natural gas
in the home delivers significant savings to consumers. As families
across the country struggle with rising costs due to inflation, it is
more important than ever that consumers be empowered with the ability
to choose the energy source for their home that makes the most economic
sense for them.
I want to emphasize that energy choice legislation does not prevent
state or local lawmakers from introducing tax breaks or other
incentives for consumers to choose to electrify their homes. Energy
choice bills simply ensure that natural gas remains an available option
for those who want it, so consumers have no limitations when it comes
to choosing the energy source that best suits their needs.
b. How important is local control when it comes to reliability
and affordability of energy? Please explain.
APGA members are not-for-profit entities that are owned and
operated by local governments, which means they have no obligation to
create profits for shareholders. Instead, they are directly accountable
to the ratepayers, which means affordability and reliability are always
a priority. Our members are residents of the communities they serve--
their ratepayers are also their families, friends, and neighbors, which
influences how they operate their utilities.
3. Mr. Schryver, during our hearing, it was suggested that the
costs of electrification would be lower than stated in your testimony
because consumers would eventually need to replace their existing
appliances at the end of their lifespan anyway.
a. Would you like to expand upon this and how you arrived at
your estimated costs?
The numbers cited in my testimony were compiled by the Consumer
Energy Alliance. They calculated the cost to consumers of replacing
their existing natural gas appliances with the electric equivalent.
While it is true that appliances have a limited lifespan and consumers
may eventually confront this cost regardless of whether they switch
fuel sources, we cannot disregard the other costs consumers will be
burdened with if gas-fired appliances are no longer an option when the
time comes for replacement.
As I mentioned in my written testimony, many homes that currently
rely on gas appliances would require an electric panel upgrade to
support the additional load of running the entire household on
electricity, which comes at an additional cost.
Not only would individual homes potentially struggle with this
increased load, our country's entire electrical grid is not prepared to
supply the increased demand that it would face in an all-electric
economy. A recent Wall Street Journal article \1\ highlighted electric
utilities' plans to invest unprecedented sums of money in overhauling
their aging infrastructure to make it more reliable and able to support
the increased demand that would be associated with the current
Administration's plans to electrify everything. Those investments will
ultimately be paid for by consumers when utilities pass those capital
costs on to them in the form of higher electric bills.
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\1\ Katherine Blunt, ``Utilities Plan Huge Electric Grid Upgrades,
Adding to Power Bills,'' Wall Street Journal, available at https://
www.wsj.com/articles/utilities-plan-huge-electric-grid-
upgrades-adding-to-power-bills-11650187802.
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As stated in my written testimony, natural gas homes currently save
an average of $1,000 per year on their energy bills compared to their
electric counterparts. There is every reason to believe that gap will
continue to grow, making it more important than ever that consumers
retain the ability to choose the energy source that makes the most
sense for them.
Questions for the Record
Sara Baldwin
Director of Electrification Policy
Energy Innovation
the honorable kathy castor
1. How would the electrification investments in the Bipartisan
Infrastructure Law, such as the $7.5 billion for electric vehicle
charging help advance access to energy-efficient vehicles? How would
the House-passed climate investments build on that foundation to
increase the energy efficiency of the entire economy?
Increasing our economywide energy efficiency requires replacing
inefficient appliances, equipment, lighting, vehicles, and buildings
with energy-efficient alternatives. Ensuring equitable access for all
consumers, businesses, and communities--regardless of income,
demographic, or location--requires available and affordable energy-
efficient options. Whether via retrofit, replacement, or new
construction, every purchase decision represents an opportunity to lock
in energy-efficient assets that generate near- and long-term energy and
cost savings while also providing climate, public health, and economic
benefits. Because energy-efficient products and equipment occasionally
have a higher upfront price and face other market barriers that prevent
widescale adoption, policy plays an important role in leveling the
playing field.
As noted in my testimony, all-electric vehicles (EVs), appliances,
and equipment have considerable energy efficiency advantages over their
fossil-fueled counterparts.\1\ Increasing their deployment so that more
consumers can benefit from these technologies requires overcoming the
primary barriers to adoption: higher upfront cost, limited access to
technologies, and limited infrastructure.
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\1\ Testimony of Sara Baldwin at the Select Committee on the
Climate Crisis Hearing ``Cost-Saving Climate Solutions: Investing in
Energy Efficiency to Promote Energy Security and Cut Energy Bills''
held on April 7, 2022.
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The Bipartisan Infrastructure Law (BIL) and the House-passed
climate investments included several provisions to address these
barriers and support widespread adoption of energy-efficient
technologies. The BIL, for example, provides funding to support:\2\
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\2\ U.S. Department of Transportation, ``President Biden, U.S.
Department of Transportation Releases Toolkit to Help Rural Communities
Build Out Electric Vehicle Charging Infrastructure,'' February 2, 2022,
https://www.transportation.gov/briefing-room/president-biden-us-
department-transportation-releases-toolkit-help-rural-communities; and
M. Moaz Uddin, ``Electric Vehicle Programs in the Bipartisan
Infrastructure Bill,'' Great Plains Institute, December 6, 2021,
https://betterenergy.org/blog/electric-vehicle-programs-in-the-
bipartisan-infrastructure-bill/.
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Increased transportation electrification
infrastructure investments to benefit rural and urban
communities while beginning strategic EV charging buildout via
$5 billion in major highway charging investments along the
Alternative Fuels Corridor. The dedicated $2.5 billion will
support rural charging and measures to improve local air
quality in disadvantaged communities.
These investments will increase consumer confidence
in their ability to charge wherever they travel--a barrier that
must be overcome to encourage widespread EV uptake.
Increased adoption of electric school buses through
the Clean School Bus Program and electric trucks at ports, both
high activity areas that can have a large impact on the air
quality and public health of nearby communities. These measures
will also provide long-term cost savings over the life of the
vehicles.
Increased domestic production of materials needed for
scaled transportation electrification: $140 million for rare-
earth elements, $3 billion for battery material processing, and
$3 billion for battery manufacturing and recycling.
While the BIL funding is an important step to enable transportation
electrification and jumpstart the shift to more energy-efficient
vehicles, it's just a down payment to equitably get more EVs on the
road. The House-passed climate investments for new and used EVs
included caps on income and vehicle costs to ensure that moderate-
income households and individuals can access and benefit from EVs (not
just those with higher incomes). The House-passed climate provisions
also provided a 30 percent tax credit for electric heavy-duty vehicles
to help convert the highest polluting vehicles on the road to run on
clean, emission-free electricity.
In addition, the House-passed climate investments provided
incentives for energy-efficient all-electric appliances and buildings
to help reduce upfront costs and make the technologies affordable for
more people.\3\ These investments would reduce overall energy consumed
across the United States, lowering consumer energy bills and improving
health in communities due to decreased NOx pollution. For example:
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\3\ Energy Innovation, ``Electric Vehicle Incentives in the Build
Back Better Act: Provisions Will Save Consumers Money, Boost U.S.
Manufacturing, And Protect Public Health,'' November 2021, https://
energyinnovation.org/wp-content/uploads/2021/11/Electric-Vehicle-
Incentives-in-the-Build-Back-Better-Act.pdf.
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High efficiency electric home rebates, with targeted
investments specifically for low- and moderate-income
households, homes in multifamily buildings, and upgrades in
underserved and Tribal communities.
Home Owner Managing Energy Savings (HOMES) Rebates
for efficiency retrofit measures that are based on the amount
of energy savings provided, with additional incentives for
contractors.
Home Energy Performance-Based Contractor Training
Grants that support contractors transitioning to the high-
efficiency economy through on-line and in-person training
courses.
Other investments in efficiency upgrades for public
housing, affordable housing projects, rural rental housing,
public buildings, tribal community housing, and public schools.
In addition to funding efficiency upgrades, these investments
would also support indoor air quality and increased climate
resilience.
Ensuring more Americans benefit from energy-efficient technologies
while shifting our economy to be more energy-efficient requires a
combination of policies that address extant barriers to uptake, while
also creating the market conditions that make it easy and affordable to
choose the more energy-efficient option. The BIL is a good start, but
the House-passed climate provisions are still needed to achieve these
goals.
2. Could you please describe how efficient electrification could
save money for consumers in communities throughout the United States?
Numerous studies show that consumers will save money with
electrification:
Energy Innovation, GridLab, and University of
California, Berkeley's 2035 2.0 Report modeling showed that a
high electrification transportation scenario powered by a clean
grid \4\ would create $2.7 trillion in consumer savings through
2050--equivalent to an average U.S. household saving $1,000 per
year for the next 30 years. This analysis also accounted for
the costs of grid upgrades that may be necessary due to
increased electrification and a decarbonized grid.
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\4\ The DRIVE Clean Scenario: 100% of new passenger vehicles in
2030 would be EVs and 100% of new medium- and heavy-duty trucks would
be EVs in 2035. Amol Phadke and Nikit Abhyankar, ``2035 2.0 Report,''
April 2021, https://www.2035report.com/transportation/.
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Energy Innovation analysis shows that electric
vehicles are cheaper to own and finance from day one in most
states compared to gasoline-powered counterparts including
purchase price, financing, taxes, incentives, maintenance, and
operational fueling or charging costs. These savings are
contingent the existing federal EV tax credit; if EV incentives
in the House-passed climate investments are included then EVs
become cheaper in nearly every instance, opening up ownership
for all Americans looking to purchase a new car.\5\
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\5\ Orvis, ``Most Electric Vehicles Are Cheaper to Own Off the Lot
than Gas Cars'' (Energy Innovation, May 2022), https://
energyinnovation.org/wp-content/uploads/2022/05/Most-Electric-Vehicles-
Are-Cheaper-Off-The-Lot-Than-Gas-Cars.pdf.
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Rewiring America found that 87 percent of U.S.
households would save money on their bills through household
electrification (104.7 million of 120.7 million households).
&ctrcir; The average U.S. household would save $356
per year on their energy bills through electrification,
for $37.3 billion in collective annual savings.
&ctrcir; 45 percent of households saving money would
be low- and moderate-income, many of which would
average $444 in annual savings.
&ctrcir; Households currently using electric
resistance, fuel oil, or propane would average $451 in
annual savings.
Energy-efficient all-electric new construction also
offer consumer savings. RMI found that new all-electric homes
save consumers on a net present basis and result in long-term
energy savings in nearly all cases (the study was conducted
across seven American cities with differing climatic
conditions). I'd refer you to my written testimony for more
details and the link to the full study.
Despite their cost-saving potential, higher upfront costs of
efficient all-electric technologies are still a deterrent for many
consumers. As such, incentives combined with rigorous performance
standards can reduce upfront costs, thus enabling more people to
benefit from technologies as they gain market maturity. As noted above,
Energy Innovation research shows that federal incentives are necessary
for consumers to experience the monthly bill benefits of purchasing
electric passenger vehicles.\6\ Without these incentives, consumer
savings will be left on the table as energy costs rise.
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\6\ Orvis, ``Most Electric Vehicles Are Cheaper to Own Off the Lot
than Gas Cars.''
3. Could you please describe how consumers benefit when local
governments are free to make decisions that support clean energy and
the beneficial electrification of homes, businesses, and vehicles? From
your perspective, how could a local government's decision to ban fossil
gas hookups actually increase the reliability and affordability of
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energy for consumers?
Decisions made at the local level directly impact residents' health
and well-being as well as community-level resilience. Local governments
can also have an outsized impact on emissions. Buildings and
transportation currently constitute 13 percent and 27 percent of the
U.S. greenhouse gas emissions inventory, respectively.\7\ Local
governments influence how buildings in their jurisdiction are built
since they create the rules governing construction, permitting,
inspections, and in some cases utility interconnections. They also
influence different types of mobility and the adoption of cleaner
vehicles through planning, zoning, incentives, regulations, and
educational campaigns. Local building and transportation policies thus
have huge potential to slow climate change, bolster resilience, reduce
energy and water consumption, multiply consumer savings, and expand
jobs and economic development.
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\7\ The 13 percent of greenhouse gas emissions attributed to
commercial and residential buildings accounts for both direct (e.g.,
onsite natural gas combustion) and indirect (e.g., offsite emissions
associated with consumed electricity) greenhouse gas emissions. U.S.
Environmental Protection Agency, ``Sources of Greenhouse Gas
Emissions,'' n.d.,
---------------------------------------------------------------------------
https://www.epa.gov/ghgemissions/sources-greenhouse-gas-emissions.
Across the country, local governments are adopting clean energy,
air quality, environmental justice, and climate goals and using the
tools at their disposal to achieve these goals. In the process of
assessing local air pollution, many of these governments are realizing
that continued fossil fuels reliance will prevent them from achieving
their climate goals while adversely impacting their constituents'
health and well-being. Many local governments are influencing the
adoption of clean electricity and electrified end-uses, along with
distributed resources that improve resilience in the face of climate
disasters. Achieving these goals at the local level directly impacts
consumers, by saving money on energy bills and greater overall
community sustainability and resilience. When local governments can
choose the course that best fits their priorities, based on the will of
their electorate and citizens, they benefit consumers where they live.
To the second part of the question, increased electrification
increases grid reliability by enabling demand-side measures that can
reduce and manage electricity load, especially during times of grid
strain. Whether through programmable thermostats, smart appliances,
automated settings responsive to price signals, or vehicle-to-grid
charging, technologies are increasingly expanding opportunities to
improve grid reliability via electrified end-uses.
Although the rates paid for electricity, natural gas, and other
fuels are not determined by local governments (they are far more
influenced by state and federal government actions as well as
international market forces), local actions to adopt energy-efficient
equipment and construct energy-efficient buildings can reduce energy
demand and lower monthly energy bills for consumers. Finally, the cost
of electricity per unit of energy sold can potentially decrease as the
economy electrifies. E3 analysis showed that grid investments required
to support the high electrification scenario powered by a clean grid
modeled in the 2035 2.0 report would have a nominal impact on rates and
could even reduce the overall cost per unit of electricity.\8\
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\8\ Eric Cutter and Emily Rogers, ``2035 2.0 Report Appendix:
Distribution Grid Cost Impacts Driven by Transportation
Electrification'' (E3--Energy and Environmental Economics, n.d.),
http://www.2035report.com/transportation/wp-content/uploads/2020/05/
2035-Transportation-Dist-Cost.pdf?hsCtaTracking=56dd694b-3158-4ad9-
8c8e-11c00a78e98f%7C4ffcaa0e-5eee-4028-87ac-cccdd080ced4.
4. Could you please explain how the normal turnover in appliances
and equipment due to their average life expectancy could help reduce
any cost impacts to consumers of switching to electric appliances and
equipment? How could Federal policy reduce that cost impact even
further to make it even easier for consumers to switch to electric
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appliances and equipment?
Electrification is an immediately available climate solution that
can occur as appliances, vehicles, and equipment are replaced due to
old age--the average life of most building appliances, equipment, and
vehicles is 10-20 years. An average consumer can switch to all-electric
alternatives without replacing all equipment and machines at once.
Rather, they can do so as the equipment ages out. The expenses incurred
to replace those machines can go towards adopting more energy-efficient
options that save consumers over the life of the equipment or vehicle.
At the time of replacement, the impact should be measured not in the
total cost of the replacement (which they would have to do regardless),
but in the incremental cost of the all-electric alternative.
Bringing down this incremental cost with incentives can help
efficient all-electric options compete on a level playing field with
their fossil fuel-powered alternatives. Incentives that help the
efficient appliances or vehicles `break even' with their fossil fueled
counterpart are most effective at influencing the consumer purchasing
decisions. Efforts to bring down the upfront cost also impact financing
and the monthly cost of ownership, which concerns many consumers. A
federal policy can make it even easier to switch to electric appliances
and equipment by influencing uptake at the point of purchase, ensuring
the all-electric option breaks even with its fossil fueled counterpart,
and by accounting for the real-life monthly cost of ownership. Ideally,
consumers should see no net upfront cost difference when choosing the
all-electric option over the fossil-fueled option.
Federal policy can also help ensure more options are in the market,
supporting greater competition which will further reduce upfront costs.
Incentives for manufacturers, distributors, and contractors to produce
ample efficient electric appliances and equipment such as heat pumps
helps meet consumer demand and reduces upfront costs. Consumer
incentives provide assurance to manufacturers that increased market
demand will exist for their products, prompting them to ramp up
production.
The House-passed climate provisions mentioned above would jumpstart
the market for all-electric appliances and EVs, while also providing
support for contractor training, domestic manufacturing, and supply-
chain development.
5. Any comparative analysis of the efficiency of residential
heating options must be done carefully. Could you please explain in
detail why electric residential heating systems could have greater
efficiency than residential heating systems powered by distributed
natural gas?
From energy production to end-use, generating electricity using
renewable energy like solar and wind to power efficient all-electric
appliances is the most efficient mode of powering end-uses. Renewable
energy is around 97 to 98 percent efficient (meaning they do not
generate much wasted energy in the form or heat or other losses to
produce a kilowatt-hour of electricity). When renewable energy is
stored in batteries and dispatched for later use, it enjoys a roundtrip
battery efficiency anywhere from 85 to 90 percent.\9\ Comparatively,
producing electricity with natural gas ranges from 40 to 60 percent
energy-efficient.\10\ Regardless of source, the transmission and
distribution of electricity results in approximately 5 percent energy
loss in the process, which impacts overall efficiency.\11\ The natural
gas transmission and distribution network incurs around 3 percent
losses due to leakage.
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\9\ Susan Tierney and Lori Bird, ``Setting the Record Straight
About Renewable Energy,'' May 12, 2020, https://www.wri.org/insights/
setting-record-straight-about-renewable-energy.
\10\ A standard natural gas turbine for power generation has an
efficiency ranging from 40 to 60 percent. Combined-cycle turbines,
which provide 85 percent of U.S. natural gas-fired electricity, account
for the higher end of the efficiency range. U.S. Energy Information
Administration, ``Natural Gas Generators Make up Largest Share of U.S.
Electricity Generation Capacity,'' October 16, 2020, https://
www.eia.gov/todayinenergy/detail.php?id=45496. Natural gas combined
heat and power (CHP) systems achieve higher efficiencies of 80 percent
or more. Steven Nadel, ``Natural Gas Energy Efficiency: Progress and
Opportunities'' (American Council for an Energy-Efficient Economy, July
2017). https://www.aceee.org/sites/default/files/publications/
researchreports/u1708.pdf.
\11\ U.S. Energy Information Administration, ``How Much Electricity
Is Lost in Electricity Transmission and Distribution in the United
States?,'' November 4, 2021,
---------------------------------------------------------------------------
https://www.eia.gov/tools/faqs/faq.php?id=105&t=3.
Equipment and appliance efficiency also impacts overall lifecycle
efficiency. As noted in my testimony, highly efficient all-electric
technologies are two to four times more energy-efficient than fossil-
fuel counterparts. Determining the lifecycle efficiency of different
energy sources for different end-uses, and the assumptions made about
transmission and distribution losses, impacts the resulting efficiency
figures. For example:
&ctrcir; Using the federal minimum standard for air source
heat pumps of 260 percent, and the natural gas production
efficiency numbers from the American Gas Association (AGA)
report cited in Mr. Schryver's testimony,\12\ electric space
heating from air source heat pumps powered by 100 percent
natural gas, results in a 105 percent lifecycle efficiency.
Comparatively, using 100 percent natural gas to fuel a high
efficiency (97 percent efficiency)\13\ natural gas furnace
would result in an 88.8 percent lifecycle efficiency.
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\12\ ``A Comparison of Energy Use, Operating Costs, and Carbon
Dioxide Emissions of Home Appliances 2021 Update'' (American Gas
Association, October 1, 2021),
---------------------------------------------------------------------------
https://www.aga.org/globalassets/research_insights/reports/ea-2021-04-
appliance-cost-and-
emissions-comparison-2021.pdf.
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\13\ Based on EIA estimates of existing stock, the average
efficiency of a natural gas furnace is 90 percent. U.S. Energy
Information Administration, ``Annual Energy Outlook 2022,'' March 3,
2022, https://www.eia.gov/outlooks/aeo/data/browser/#/?id=30-
AEO2022&cases=ref2022&sourcekey=0.
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&ctrcir; Using 100 renewable energy to power the same air
source heat pump (260 percent efficient) would result in a
lifecycle efficiency of 240 percent--almost three times more
energy-efficient than heating with a gas distribution system
fueling a gas furnace.
&ctrcir; The energy trajectory efficiency of energy delivered
to the home in AGA's report, which does not include end-use
device efficiency, shows that electricity generated by
renewable energy results in a cumulative efficiency of around
92 percent, compared with natural gas-based electricity's
cumulative efficiency of around 41 percent.\14\
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\14\ ``A Comparison of Energy Use, Operating Costs, and Carbon
Dioxide Emissions of Home Appliances 2021 Update.''
---------------------------------------------------------------------------
&ctrcir; According to the same AGA report, the end-use of the
appliance impacts the overall lifecycle efficiency (emphasis
added):
``For new residential applications, full-fuel-cycle
efficiency will be 74 percent for the natural gas space
heating option that meets the minimum efficiency rating
of 0.80. For electric heat pumps, whose federal minimum
standard for fuel utilization efficiency is about 260
percent, the full-fuel-cycle efficiency will be about
98 percent. Less efficient electric resistance heating
has a full-fuel-cycle heating efficiency of only 39
percent. The full- fuel-cycle efficiency for an oil
furnace averages about 67 percent, due to an energy
trajectory efficiency of 84 percent. The propane
furnace full-fuel-cycle efficiency measure is also 70
percent. Again, these efficiencies reflect the total of
all losses from extraction, processing, transportation,
conversion, distribution, and end use of the natural
gas, electric, oil, and propane systems.'' \15\
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\15\ ``A Comparison of Energy Use, Operating Costs, and Carbon
Dioxide Emissions of Home Appliances 2021 Update.''
In summary, the combined energy efficiency of electricity generated
from renewable energy and efficient all-electric appliances used for
space heating is the most energy-efficient mode of space heating--and
this will only increase as the grid becomes increasingly clean and
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modernized.
6. The reliability of our energy systems is important to
maintaining health, safety, and a high quality of life for American
families. Could you please expand on how energy efficiency and
electrification investments can enhance the reliability of the electric
grid? How does a reliable electric grid help unlock the efficiency
benefits of electrification?
The U.S. electricity grid and many of its largest utilities and
grid operators are subject to numerous regulations and oversight that
serve to ensure reliability and affordability. The established National
Electricity Reliability Council (NERC) Reliability Standards define the
reliability requirements for planning and operating the North American
bulk power system that focuses on performance, risk management, and
entity capabilities.\16\
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\16\ North American Electric Reliability corporation, ``NERC
Standards,'' n.d., https://www.nerc.com/pa/Stand/Pages/default.aspx.
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According to the latest U.S. Energy Information Administration
data, the U.S. electricity grid was fully operational and reliable for
the average customer 99.9 percent of the time in 2020.\17\ That same
year, during the limited time the grid was down for the average U.S.
customer, 75 percent of outages were due to major weather events
(hurricanes, snowstorms, wildfires)--these climate-related events are
only getting worse as we delay climate action. Electrification and
efficiency can further enhance reliability by deploying new and
existing technologies, while also providing a clear climate solution
that can be scaled within this decade:
---------------------------------------------------------------------------
\17\ U.S. Energy Information Administration, ``U.S. Electricity
Customers Experienced Eight Hours of Power Interruptions in 2020,''
November 10, 2021,
---------------------------------------------------------------------------
https://www.eia.gov/todayinenergy/detail.php?id=50316.
&ctrcir; Widespread adoption of high-efficiency electric
stoves, water heaters, and heat pumps reduces energy waste and
overall demand for electricity. Generation resources allocated
to serve peak demand can be utilized less frequently, thus
ensuring greater longevity of existing capacity and other grid
infrastructure components, such as transmission lines and
substations.
&ctrcir; Electrification provides many opportunities for
demand-side measures that enhance reliability. For example,
some electric appliances can be programmed to respond to grid
conditions and price signals. Others, such as energy-efficient
air conditioners, can provide valuable grid services via demand
response programs.\18\ New smart grid funding from the BIL will
support continued deployment of these functions and
capabilities at scale.\19\
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\18\ Justin Brant, ``Grid-Interactive Efficient Buildings:
Providing Energy Demand Flexibility for Utilities in the Southwest''
(Southwest Energy Efficiency Project, August 2019), http://
swenergy.org/pubs/grid-interactive-efficient-buildings-report.
\19\ Ellie Long, ``Here's How the Infrastructure Bill Improves The
Grid,'' November 22, 2021, https://www.ase.org/blog/heres-how-
infrastructure-bill-improves-grid.
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&ctrcir; The increasing number of extreme weather events
requires a greater attention to resiliency, and all-electric
equipment can be powered directly by distributed and community
renewable energy and battery storage to increase resilience
when the grid goes down.
&ctrcir; Winter Storm Uri in Texas was largely due to an
overreliance on natural gas that failed in the storm due to
lack of appropriate weatherization of equipment. Such failures
were chiefly responsible for and exacerbated the power
outage.\20\
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\20\ Dan Esposito and Eric Gimon, ``The Texas Big Freeze: How a
Changing Climate Pushed the State's Power Grid to the Brink,''
UtilityDive, June 2, 2021,
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https://www.utilitydive.com/news/the-texas-big-freeze-how-a-changing-
climate-pushed-the-states-power-grid/601098/.
&ctrcir; Most natural gas appliances and modern gas furnaces
rely on electricity to operate, even though their primary fuel
source is gas. This means that heating with natural gas does
not obviate consumer impacts during an outage. For most gas
appliances, an electric power outage also renders gas
appliances inoperable, and reliability of the gas system does
not translate to reliability of using gas-burning appliances.
The same is true for gas stations--you cannot pump gas if the
power goes out.
Fortunately, the BIL also includes $65 billion in funding to
upgrade the grid and bolster grid reliability going forward. This and
numerous ongoing efforts by utilities and regulators across the country
will ensure our electric grid remains strong, reliable, and resilient.
7. How would maximizing electrification as a climate solution
reduce greenhouse gas pollution from the U.S. consistent with limiting
average global warming to 1.5 degrees C?
According to several studies, an 80 percent clean grid by 2030 is
achievable and would not compromise grid reliability nor
affordability.\21\ A decarbonized electric grid is the lynchpin to
broader economywide decarbonization as we electrify more sectors and
end uses; indeed it is the most scalable and affordable pathway to
align with a 1.5 degree C climate stable pathway. Rather than wait for
a not-yet-existing technology breakthrough or commercializing expensive
alternatives, electrification offers a near-term route to decarbonizing
sectors still reliant on fossil fuels: namely, the building sector,
ground transportation, and much of industry.
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\21\ Dan Esposito, ``Studies Agree 80 Percent Clean Electricity By
2030 Would Save Lives And Create Jobs At Minimal Cost'' (Energy
Innovation, September 7, 2021), https://energyinnovation.org/
publication/studies-agree-80-percent-clean-electricity-by-2030-would-
save-lives-and-create-jobs-at-minimal-cost/.
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As noted in my testimony, Energy Innovation modeling with our
Energy Policy Simulator shows which sectoral policies would put the
U.S. on a 1.5 degree Celsius climate stable pathway through
electrification and bring other benefits, for example:
Buildings: reaching a 100 percent electric appliance
sales standard by 2030 would cut 530 million metric tons (MMT)
of carbon dioxide per year by 2050, contributing 10 percent of
the overall emissions reductions needed to meet the U.S. NDC by
2050.
Transportation: Achieving 100 percent EV sales for
passenger vehicles, medium- and heavy-duty trucks, and buses by
2035 would reduce emissions by 821 MMT per year by 2050, or 16
percent of total emissions reductions needed to meet the U.S.
NDC by 2050. This would save consumers $2.7 trillion dollars
through 2050.\22\
---------------------------------------------------------------------------
\22\ Amol Phadke and Nikit Abhyankar, ``2035 2.0 Report,'' April
2021,https://www.2035report.com/transportation/.
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Industry: Electrification, paired with supplemental
green hydrogen, can reduce emissions by 1,325 MMT per year by
2050, or more than 25 percent of total emissions reductions
needed to meet the U.S. NDC by 2050.
8. American innovation is one of our greatest strengths. Could you
please expand on how the electrified technologies you mentioned in your
testimony are innovative and more efficient improvements over last
century's fossil fuel-powered cars and appliances?
Electric technologies are efficient by design. Heat pumps move heat
rather than burn fuel to heat or cool space and water. Induction stoves
transfer heat directly to pans rather than first letting it dissipate
into the air along with harmful air pollution from burning fossil
fuels. In vehicles, removing combustion technology to instead rely only
on battery storage reduces vehicle weight and total moving parts, thus
reducing maintenance expenses and overall wear and tear over the
vehicle's lifetime. Relying on battery charging means that users can
charge their vehicle at times that suit them--overnight when it's
parked in the garage or along the street, at the store as they shop, at
work, or any other time the vehicle is parked (assuming charging is
available). The new era of technologies has advantages of comfort,
performance, and in many cases, long-term affordability. Their biggest
advantage, however, is mitigating climate change while improving air
quality and creating jobs.
9. How could American leadership on efficient electrification help
encourage other countries to follow our example? Could American
innovation and exports of clean and electrified technologies facilitate
faster adoption of climate solutions in other countries?
As one of the world's top GHG emitters, the actions we take to
reduce emissions and lead by example send a strong signal to other
countries that we are committed to being part of the global solution to
climate change. However, the U.S. must ramp up efforts to remain
competitive. From 2010 through 2020, China manufactured the largest
proportion of EVs globally at 44 percent, while Europe produced 25
percent. By 2020, the U.S. had manufactured only 18 percent of the
global EV stock, a decrease from 20 percent in 2017.\23\ Failure to
stimulate domestic manufacturing of EVs and batteries, along with clean
technology supply chains, will hinder our ability to lead in these
critical markets.
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\23\ ``Update on Electric Vehicle Costs in the United States
through 2030,'' International Council on Clean Transportation (blog),
accessed April 19, 2022, https://theicct.org/publication/update-on-
electric-vehicle-costs-in-the-united-states-through-2030/.
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Continued federal leadership can leverage the full capabilities of
our domestic manufacturing industries and position the U.S. as a global
leader. For example, adopting federal incentives for manufacturers to
support the deployment of 100 percent passenger EV manufacturing by
2035 will create jobs and increase affordability for U.S. consumers.
Similarly, significantly ramping up manufacturing of heat pumps and
heat pump water heaters would support growth of domestic jobs and
enhance competitiveness in a clean, electrified future. Doubling down
on fossil fuel technologies, on the other hand, would likely render us
obsolete in a global economy moving away from fossil fuels and toward
decarbonization technologies.
10. How could the EnergyStar program be updated to better support
efficient electrification consistent with our national climate goals?
The U.S. Environmental Protection Agency's EnergyStar program
recently removed gas-fired appliances from their ``Most Efficient''
designation, which affirms the efficiency advantage electric appliances
have over gas appliances. However, their general Energy-Efficient
Products for Consumers list still includes several gas appliances,
which may confuse consumers considering which equipment to buy if they
are seeking highly energy-efficient, price stable, and climate-friendly
options. The EnergyStar program could align their future decision-
making to recognize only high-efficiency electric appliances, including
air source heat pumps, including those designated for cold climates,
and geothermal heat pumps.
11. How could Federal energy efficiency investments promote
American energy security? Could increased energy efficiency help reduce
demand for globally traded fossil fuels with volatile prices?
The global oil and gas markets are in turmoil amidst the Russian
invasion of Ukraine, leading the European Union and the U.S. to reduce
reliance on Russian oil and gas. Temporary increases to domestic fossil
fuel production are unlikely to offer reprieve, and continued fossil
fuel extraction and production will hold the U.S. captive to the
inherent volatility and insecurity associated with global energy
markets. Reducing demand for these products, however, would have a
dampening effect on prices, and limit the power of the petro-state
dictators controlling their production and sale. The faster the U.S.
moves toward energy-efficient electrification and generation of
renewable electricity, the sooner we can achieve greater energy
security at home and abroad.
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