[Federal Register Volume 64, Number 109 (Tuesday, June 8, 1999)]
[Presidential Documents]
[Pages 30851-30860]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-14633]



[[Page 30849]]

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Part IV





The President





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Executive Order 13123--Greening the Government Through Efficient Energy 
Management
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                         Presidential Documents 
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  Federal Register / Vol. 64, No. 109 / Tuesday, June 8, 1999 / 
Presidential Documents  

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 Title 3--
 The President

[[Page 30851]]

                Executive Order 13123 of June 3, 1999

                
Greening the Government Through Efficient Energy 
                Management

                By the authority vested in me as President by the 
                Constitution and the laws of the United States of 
                America, including the National Energy Conservation 
                Policy Act (Public Law 95-619, 92 Stat. 3206, 42 U.S.C. 
                8252 et seq.), as amended by the Energy Policy Act of 
                1992 (EPACT) (Public Law 102-486, 106 Stat. 2776), and 
                section 301 of title 3, United States Code, it is 
                hereby ordered as follows:

                PART 1--PREAMBLE

                Section 101. Federal Leadership. The Federal 
                Government, as the Nation's largest energy consumer, 
                shall significantly improve its energy management in 
                order to save taxpayer dollars and reduce emissions 
                that contribute to air pollution and global climate 
                change. With more than 500,000 buildings, the Federal 
                Government can lead the Nation in energy efficient 
                building design, construction, and operation. As a 
                major consumer that spends $200 billion annually on 
                products and services, the Federal Government can 
                promote energy efficiency, water conservation, and the 
                use of renewable energy products, and help foster 
                markets for emerging technologies. In encouraging 
                effective energy management in the Federal Government, 
                this order builds on work begun under EPACT and 
                previous Executive orders.

                PART 2--GOALS

                Sec. 201. Greenhouse Gases Reduction Goal. Through 
                life-cycle cost-effective energy measures, each agency 
                shall reduce its greenhouse gas emissions attributed to 
                facility energy use by 30 percent by 2010 compared to 
                such emissions levels in 1990. In order to encourage 
                optimal investment in energy improvements, agencies can 
                count greenhouse gas reductions from improvements in 
                nonfacility energy use toward this goal to the extent 
                that these reductions are approved by the Office of 
                Management and Budget (OMB).

                Sec. 202. Energy Efficiency Improvement Goals. Through 
                life-cycle cost-effective measures, each agency shall 
                reduce energy consumption per gross square foot of its 
                facilities, excluding facilities covered in section 203 
                of this order, by 30 percent by 2005 and 35 percent by 
                2010 relative to 1985. No facilities will be exempt 
                from these goals unless they meet new criteria for 
                exemptions, to be issued by the Department of Energy 
                (DOE).

                Sec. 203. Industrial and Laboratory Facilities. Through 
                life-cycle cost-effective measures, each agency shall 
                reduce energy consumption per square foot, per unit of 
                production, or per other unit as applicable by 20 
                percent by 2005 and 25 percent by 2010 relative to 
                1990. No facilities will be exempt from these goals 
                unless they meet new criteria for exemptions, as issued 
                by DOE.

                Sec. 204. Renewable Energy. Each agency shall strive to 
                expand the use of renewable energy within its 
                facilities and in its activities by implementing 
                renewable energy projects and by purchasing electricity 
                from renewable energy sources. In support of the 
                Million Solar Roofs initiative, the Federal Government 
                shall strive to install 2,000 solar energy systems at 
                Federal facilities by the end of 2000, and 20,000 solar 
                energy systems at Federal facilities by 2010.

[[Page 30852]]

                Sec. 205. Petroleum. Through life-cycle cost-effective 
                measures, each agency shall reduce the use of petroleum 
                within its facilities. Agencies may accomplish this 
                reduction by switching to a less greenhouse gas-
                intensive, nonpetroleum energy source, such as natural 
                gas or renewable energy sources; by eliminating 
                unnecessary fuel use; or by other appropriate methods. 
                Where alternative fuels are not practical or life-cycle 
                cost-effective, agencies shall strive to improve the 
                efficiency of their facilities.

                Sec. 206. Source Energy. The Federal Government shall 
                strive to reduce total energy use and associated 
                greenhouse gas and other air emissions, as measured at 
                the source. To that end, agencies shall undertake life-
                cycle cost-effective projects in which source energy 
                decreases, even if site energy use increases. In such 
                cases, agencies will receive credit toward energy 
                reduction goals through guidelines developed by DOE.

                Sec. 207. Water Conservation. Through life-cycle cost-
                effective measures, agencies shall reduce water 
                consumption and associated energy use in their 
                facilities to reach the goals set under section 503(f) 
                of this order. Where possible, water cost savings and 
                associated energy cost savings shall be included in 
                Energy-Savings Performance Contracts and other 
                financing mechanisms.

                PART 3--ORGANIZATION AND ACCOUNTABILITY

                Sec. 301. Annual Budget Submission. Each agency's 
                budget submission to OMB shall specifically request 
                funding necessary to achieve the goals of this order. 
                Budget submissions shall include the costs associated 
                with: encouraging the use of, administering, and 
                fulfilling agency responsibilities under Energy-Savings 
                Performance Contracts, utility energy-efficiency 
                service contracts, and other contractual platforms for 
                achieving conservation goals; implementing life-cycle 
                cost-effective measures; procuring life-cycle cost-
                effective products; and constructing sustainably 
                designed new buildings, among other energy costs. OMB 
                shall issue guidelines to assist agencies in developing 
                appropriate requests that support sound investments in 
                energy improvements and energy-using products. OMB 
                shall explore the feasibility of establishing a fund 
                that agencies could draw on to finance exemplary energy 
                management activities and investments with higher 
                initial costs but lower life-cycle costs. Budget 
                requests to OMB in support of this order must be within 
                each agency's planning guidance level.

                Sec. 302. Annual Implementation Plan. Each agency shall 
                develop an annual implementation plan for fulfilling 
                the requirements of this order. Such plans shall be 
                included in the annual reports to the President under 
                section 303 of this order.

                Sec. 303. Annual Reports to the President. (a) Each 
                agency shall measure and report its progress in meeting 
                the goals and requirements of this order on an annual 
                basis. Agencies shall follow reporting guidelines as 
                developed under section 306(b) of this order. In order 
                to minimize additional reporting requirements, the 
                guidelines will clarify how the annual report to the 
                President should build on each agency's annual Federal 
                energy reports submitted to DOE and the Congress. 
                Annual reports to the President are due on January 1 of 
                each year beginning in the year 2000.

                    (b) Each agency's annual report to the President 
                shall describe how the agency is using each of the 
                strategies described in Part 4 of this order to help 
                meet energy and greenhouse gas reduction goals. The 
                annual report to the President shall explain why 
                certain strategies, if any, have not been used. It 
                shall also include a listing and explanation of exempt 
                facilities.

                Sec. 304. Designation of Senior Agency Official. Each 
                agency shall designate a senior official, at the 
                Assistant Secretary level or above, to be responsible 
                for meeting the goals and requirements of this order, 
                including preparing the annual report to the President. 
                Such designation shall be reported by each Cabinet 
                Secretary or agency head to the Deputy Director for 
                Management of OMB within 30 days of the date of this 
                order. Designated officials shall participate in the 
                Interagency Energy Policy Committee, described in 
                section

[[Page 30853]]

                306(d) of this order. The Committee shall communicate 
                its activities to all designated officials to assure 
                proper coordination and achievement of the goals and 
                requirements of this order.

                Sec. 305. Designation of Agency Energy Teams. Within 90 
                days of the date of this order, each agency shall form 
                a technical support team consisting of appropriate 
                procurement, legal, budget, management, and technical 
                representatives to expedite and encourage the agency's 
                use of appropriations, Energy-Savings Performance 
                Contracts, and other alternative financing mechanisms 
                necessary to meet the goals and requirements of this 
                order. Agency energy team activities shall be 
                undertaken in collaboration with each agency's 
                representative to the Interagency Energy Management 
                Task Force, as described in section 306(e) of this 
                order.

                Sec. 306. Interagency Coordination. (a) Office of 
                Management and Budget. The Deputy Director for 
                Management of OMB, in consultation with DOE, shall be 
                responsible for evaluating each agency's progress in 
                improving energy management and for submitting agency 
                energy scorecards to the President to report progress.

                      (1) OMB, in consultation with DOE and other 
                agencies, shall develop the agency energy scorecards 
                and scoring system to evaluate each agency's progress 
                in meeting the goals of this order. The scoring 
                criteria shall include the extent to which agencies are 
                taking advantage of key tools to save energy and reduce 
                greenhouse gas emissions, such as Energy-Savings 
                Performance Contracts, utility energy-efficiency 
                service contracts, ENERGY STAR and other 
                energy efficient products, renewable energy 
                technologies, electricity from renewable energy 
                sources, and other strategies and requirements listed 
                in Part 4 of this order, as well as overall efficiency 
                and greenhouse gas metrics and use of other innovative 
                energy efficiency practices. The scorecards shall be 
                based on the annual energy reports submitted to the 
                President under section 303 of this order.
                      (2) The Deputy Director for Management of OMB 
                shall also select outstanding agency energy management 
                team(s), from among candidates nominated by DOE, for a 
                new annual Presidential award for energy efficiency.
                    (b) Federal Energy Management Program. The DOE's 
                Federal Energy Management Program (FEMP) shall be 
                responsible for working with the agencies to ensure 
                that they meet the goals of this order and report their 
                progress. FEMP, in consultation with OMB, shall develop 
                and issue guidelines for agencies' preparation of their 
                annual reports to the President on energy management, 
                as required in section 303 of this order. FEMP shall 
                also have primary responsibility for collecting and 
                analyzing the data, and shall assist OMB in ensuring 
                that agency reports are received in a timely manner.
                    (c) President's Management Council. The President's 
                Management Council (PMC), chaired by the Deputy 
                Director for Management of OMB and consisting of the 
                Chief Operating Officers (usually the Deputy Secretary) 
                of the largest Federal departments and agencies, will 
                periodically discuss agencies' progress in improving 
                Federal energy management.
                    (d) Interagency Energy Policy Committee. This 
                Committee was established by the Department of Energy 
                Organization Act. It consists of senior agency 
                officials designated in accordance with section 304 of 
                this order. The Committee is responsible for 
                encouraging implementation of energy efficiency 
                policies and practices. The major energy-consuming 
                agencies designated by DOE are required to participate 
                in the Committee. The Committee shall communicate its 
                activities to all designated senior agency officials to 
                promote coordination and achievement of the goals of 
                this order.
                    (e) Interagency Energy Management Task Force. The 
                Task Force was established by the National Energy 
                Conservation Policy Act. It consists of each agency's 
                chief energy manager. The Committee shall continue to 
                work toward improving agencies' use of energy 
                management tools and sharing information on Federal 
                energy management across agencies.

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                Sec. 307. Public/Private Advisory Committee. The 
                Secretary of Energy will appoint an advisory committee 
                consisting of representatives from Federal agencies, 
                State governments, energy service companies, utility 
                companies, equipment manufacturers, construction and 
                architectural companies, environmental, energy and 
                consumer groups, and other energy-related 
                organizations. The committee will provide input on 
                Federal energy management, including how to improve use 
                of Energy-Savings Performance Contracts and utility 
                energy-efficiency service contracts, improve 
                procurement of ENERGY STAR and other energy 
                efficient products, improve building design, reduce 
                process energy use, and enhance applications of 
                efficient and renewable energy technologies at Federal 
                facilities.

                Sec. 308. Applicability. This order applies to all 
                Federal departments and agencies. General Services 
                Administration (GSA) is responsible for working with 
                agencies to meet the requirements of this order for 
                those facilities for which GSA has delegated operations 
                and maintenance authority. The Department of Defense 
                (DOD) is subject to this order to the extent that it 
                does not impair or adversely affect military operations 
                and training (including tactical aircraft, ships, 
                weapons systems, combat training, and border security).

                PART 4--PROMOTING FEDERAL LEADERSHIP IN ENERGY 
                MANAGEMENT

                Sec. 401. Life-Cycle Cost Analysis. Agencies shall use 
                life-cycle cost analysis in making decisions about 
                their investments in products, services, construction, 
                and other projects to lower the Federal Government's 
                costs and to reduce energy and water consumption. Where 
                appropriate, agencies shall consider the life-cycle 
                costs of combinations of projects, particularly to 
                encourage bundling of energy efficiency projects with 
                renewable energy projects. Agencies shall also retire 
                inefficient equipment on an accelerated basis where 
                replacement results in lower life-cycle costs. Agencies 
                that minimize life-cycle costs with efficiency measures 
                will be recognized in their scorecard evaluations.

                Sec. 402. Facility Energy Audits. Agencies shall 
                continue to conduct energy and water audits for 
                approximately 10 percent of their facilities each year, 
                either independentlyor through Energy-Savings 
                Performance Contracts or utility energy-efficiency 
                service contracts.

                Sec. 403. Energy Management Strategies and Tools. 
                Agencies shall use a variety of energy management 
                strategies and tools, where life-cycle cost-effective, 
                to meet the goals of this order. An agency's use of 
                these strategies and tools shall be taken into account 
                in assessing the agency's progress and formulating its 
                scorecard.

                    (a) Financing Mechanisms. Agencies shall maximize 
                their use of available alternative financing 
                contracting mechanisms, including Energy-Savings 
                Performance Contracts and utility energy-efficiency 
                service contracts, when life-cycle cost-effective, to 
                reduce energy use and cost in their facilities and 
                operations. Energy-Savings Performance Contracts, which 
                are authorized under the National Energy Conservation 
                Policy Act, as modified by the Energy Policy Act of 
                1992, and utility energy-efficiency service contracts 
                provide significant opportunities for making Federal 
                facilities more energy efficient at no net cost to 
                taxpayers.
                    (b) ENERGY STAR and Other Energy 
                Efficient Products.
                      (1) Agencies shall select, where life-cycle cost-
                effective, ENERGY STAR and other energy 
                efficient products when acquiring energy-using 
                products. For product groups where ENERGY 
                STAR labels are not yet available, agencies 
                shall select products that are in the upper 25 percent 
                of energy efficiency as designated by FEMP. The 
                Environmental Protection Agency (EPA) and DOE shall 
                expedite the process of designating products as ENERGY 
                STAR and will merge their current efficiency 
                rating procedures.
                      (2) GSA and the Defense Logistics Agency (DLA), 
                with assistance from EPA and DOE, shall create clear 
                catalogue listings that designate these

[[Page 30855]]

                products in both print and electronic formats. In 
                addition, GSA and DLA shall undertake pilot projects 
                from selected energy-using products to show a ``second 
                price tag'', which means an accounting of the operating 
                and purchase costs of the item, in both printed and 
                electronic catalogues and assess the impact of 
                providing this information on Federal purchasing 
                decisions.
                      (3) Agencies shall incorporate energy efficient 
                criteria consistent with ENERGY STAR and 
                other FEMP-designated energy efficiency levels into all 
                guide specifications and project specifications 
                developed for new construction and renovation, as well 
                as into product specification language developed for 
                Basic Ordering Agreements, Blanket Purchasing 
                Agreements, Government Wide Acquisition Contracts, and 
                all other purchasing procedures.
                      (4) DOE and OMB shall also explore the creation 
                of financing agreements with private sector suppliers 
                to provide private funding to offset higher up-front 
                costs of efficient products. Within 9 months of the 
                date of this order, DOE shall report back to the 
                President's Management Council on the viability of such 
                alternative financing options.
                    (c) ENERGY STAR Buildings. Agencies shall 
                strive to meet the ENERGY STAR Building 
                criteria for energy performance and indoor 
                environmental quality in their eligible facilities to 
                the maximum extent practicable by the end of 2002. 
                Agencies may use Energy-Savings Performance Contracts, 
                utility energy-efficiency service contracts, or other 
                means to conduct evaluations and make improvements to 
                buildings in order to meet the criteria. Buildings that 
                rank in the top 25 percent in energy efficiency 
                relative to comparable commercial and Federal buildings 
                will receive the ENERGY STAR building label. 
                Agencies shall integrate this building rating tool into 
                their general facility audits.
                    (d) Sustainable Building Design. DOD and GSA, in 
                consultation with DOE and EPA, shall develop 
                sustainable design principles. Agencies shall apply 
                such principles to the siting, design, and construction 
                of new facilities. Agencies shall optimize life-cycle 
                costs, pollution, and other environmental and energy 
                costs associated with the construction, life-cycle 
                operation, and decommissioning of the facility. 
                Agencies shall consider using Energy-Savings 
                Performance Contracts or utility energy-efficiency 
                service contracts to aid them in constructing 
                sustainably designed buildings.
                    (e) Model Lease Provisions. Agencies entering into 
                leases, including the renegotiation or extension of 
                existing leases, shall incorporate lease provisions 
                that encourage energy and water efficiency wherever 
                life-cycle cost-effective. Build-to-suit lease 
                solicitations shall contain criteria encouraging 
                sustainable design and development, energy efficiency, 
                and verification of building performance. Agencies 
                shall include a preference for buildings having the 
                ENERGY STAR building label in their selection 
                criteria for acquiring leased buildings. In addition, 
                all agencies shall encourage lessors to apply for the 
                ENERGY STAR building label and to explore and 
                implement projects that would reduce costs to the 
                Federal Government, including projects carried out 
                through the lessors' Energy-Savings Performance 
                Contracts or utility energy-efficiency service 
                contracts.
                    (f) Industrial Facility Efficiency Improvements. 
                Agencies shall explore efficiency opportunities in 
                industrial facilities for steam systems, boiler 
                operation, air compressor systems, industrial 
                processes, and fuel switching, including cogeneration 
                and other efficiency and renewable energy technologies.
                    (g) Highly Efficient Systems. Agencies shall 
                implement district energy systems, and other highly 
                efficient systems, in new construction or retrofit 
                projects when life-cycle cost-effective. Agencies shall 
                consider combined cooling, heat, and power when 
                upgrading and assessing facility power needs and shall 
                use combined cooling, heat, and power systems when 
                life-cycle cost-effective. Agencies shall survey local 
                natural resources to optimize use

[[Page 30856]]

                of available biomass, bioenergy, geothermal, or other 
                naturally occurring energy sources.
                    (h) Off-Grid Generation. Agencies shall use off-
                grid generation systems, including solar hot water, 
                solar electric, solar outdoor lighting, small wind 
                turbines, fuel cells, and other off-grid alternatives, 
                where such systems are life-cycle cost-effective and 
                offer benefits including energy efficiency, pollution 
                prevention, source energy reductions, avoided 
                infrastructure costs, or expedited service.

                Sec. 404. Electricity Use. To advance the greenhouse 
                gas and renewable energy goals of this order, and 
                reduce source energy use, each agency shall strive to 
                use electricity from clean, efficient, and renewable 
                energy sources. An agency's efforts in purchasing 
                electricity from efficient and renewable energy sources 
                shall be taken into account in assessing the agency's 
                progress and formulating its score card.

                    (a) Competitive Power. Agencies shall take 
                advantage of competitive opportunities in the 
                electricity and natural gas markets to reduce costs and 
                enhance services. Agencies are encouraged to aggregate 
                demand across facilities or agencies to maximize their 
                economic advantage.
                    (b) Reduced Greenhouse Gas Intensity of Electric 
                Power. When selecting electricity providers, agencies 
                shall purchase electricity from sources that use high 
                efficiency electric generating technologies when life-
                cycle cost-effective. Agencies shall consider the 
                greenhouse gas intensity of the source of the 
                electricity and strive to minimize the greenhouse gas 
                intensity of purchased electricity.
                    (c) Purchasing Electricity from Renewable Energy 
                Sources.
                      (1) Each agency shall evaluate its current use of 
                electricity from renewable energy sources and report 
                this level in its annual report to the President. Based 
                on this review, each agency should adopt policies and 
                pursue projects that increase the use of such 
                electricity. Agencies should include provisions for the 
                purchase of electricity from renewable energy sources 
                as a component of their requests for bids whenever 
                procuring electricity. Agencies may use savings from 
                energy efficiency projects to pay additional 
                incremental costs of electricity from renewable energy 
                sources.
                      (2) In evaluating opportunities to comply with 
                this section, agencies should consider: my 
                Administration's goal of tripling nonhydroelectric 
                renewable energy capacity in the United States by 2010; 
                the renewable portfolio standard specified in the 
                restructuring guidelines for the State in which the 
                facility is located; GSA's efforts to make electricity 
                from renewable energy sources available to Federal 
                electricity purchasers; and EPA's guidelines on 
                crediting renewable energy power in implementation of 
                Clean Air Act standards.

                Sec. 405. Mobile Equipment. Each agency shall seek to 
                improve the design, construction, and operation of its 
                mobile equipment, and shall implement all life-cycle 
                cost-effective energy efficiency measures that result 
                in cost savings while improving mission performance. To 
                the extent that such measures are life-cycle cost-
                effective, agencies shall consider enhanced use of 
                alternative or renewable-based fuels.

                Sec. 406. Management and Government Performance. 
                Agencies shall use the following management strategies 
                in meeting the goals of this order.

                    (a) Awards. Agencies shall use employee incentive 
                programs to reward exceptional performance in 
                implementing this order.
                    (b) Performance Evaluations. Agencies shall include 
                successful implementation of provisions of this order 
                in areas such as Energy-Savings Performance Contracts, 
                sustainable design, energy efficient procurement, 
                energy efficiency, water conservation, and renewable 
                energy projects in the position descriptions and 
                performance evaluations of agency heads, members of the 
                agency energy team, principal program managers, heads 
                of field offices, facility managers, energy managers, 
                and other appropriate employees.

[[Page 30857]]

                    (c) Retention of Savings and Rebates. Agencies 
                granted statutory authority to retain a portion of 
                savings generated from efficient energy and water 
                management are encouraged to permit the retention of 
                the savings at the facility or site where the savings 
                occur to provide greater incentive for that facility 
                and its site managers to undertake more energy 
                management initiatives, invest in renewable energy 
                systems, and purchase electricity from renewable energy 
                sources.
                    (d) Training and Education. Agencies shall ensure 
                that all appropriate personnel receive training for 
                implementing this order.
                      (1) DOE, DOD, and GSA shall provide relevant 
                training or training materials for those programs that 
                they make available to all Federal agencies relating to 
                the energy management strategies contained in this 
                order.
                      (2) The Federal Acquisition Institute and the 
                Defense Acquisition University shall incorporate into 
                existing procurement courses information on Federal 
                energy management tools, including Energy-Savings 
                Performance Contracts, utility energy-efficiency 
                service contracts, ENERGY STAR and other 
                energy efficient products, and life-cycle cost 
                analysis.
                      (3) All agencies are encouraged to develop 
                outreach programs that include education, training, and 
                promotion of ENERGY STAR and other energy-
                efficient products for Federal purchase card users. 
                These programs may include promotions with billing 
                statements, user training, catalogue awareness, and 
                exploration of vendor data collection of purchases.
                    (e) Showcase Facilities. Agencies shall designate 
                exemplary new and existing facilities with significant 
                public access and exposure as showcase facilities to 
                highlight energy or water efficiency and renewable 
                energy improvements.

                PART 5--TECHNICAL ASSISTANCE

                Sec. 501. Within 120 days of this order, the Director 
                of OMB shall:

                    (a) develop and issue guidance to agency budget 
                officers on preparation of annual funding requests 
                associated with the implementation of the order for the 
                FY 2001 budget;
                    (b) in collaboration with the Secretary of Energy, 
                explain to agencies how to retain savings and reinvest 
                in other energy and water management projects; and
                    (c) in collaboration with the Secretary of Energy 
                through the Office of Federal Procurement Policy, 
                periodically brief agency procurement executives on the 
                use of Federal energy management tools, including 
                Energy-Savings Performance Contracts, utility energy-
                efficiency service contracts, and procurement of energy 
                efficient products and electricity from renewable 
                energy sources.

                Sec. 502. Within 180 days of this order, the Secretary 
                of Energy, in collaboration with other agency heads, 
                shall:

                    (a) issue guidelines to assist agencies in 
                measuring energy per square foot, per unit of 
                production, or other applicable unit in industrial, 
                laboratory, research, and other energy-intensive 
                facilities;
                    (b) establish criteria for determining which 
                facilities are exempt from the order. In addition, DOE 
                must provide guidance for agencies to report proposed 
                exemptions;
                    (c) develop guidance to assist agencies in 
                calculating appropriate energy baselines for previously 
                exempt facilities and facilities occupied after 1990 in 
                order to measure progress toward goals;
                    (d) issue guidance to clarify how agencies 
                determine the life-cycle cost for investments required 
                by the order, including how to compare different energy 
                and fuel options and assess the current tools;
                    (e) issue guidance for providing credit toward 
                energy efficiency goals for cost-effective projects 
                where source energy use declines but site energy use 
                increases; and

[[Page 30858]]

                    (f) provide guidance to assist each agency to 
                determine a baseline of water consumption.

                Sec. 503. Within 1 year of this order, the Secretary of 
                Energy, in collaboration with other agency heads, 
                shall:

                    (a) provide guidance for counting renewable and 
                highly efficient energy projects and purchases of 
                electricity from renewable and highly efficient energy 
                sources toward agencies' progress in reaching 
                greenhouse gas and energy reduction goals;
                    (b) develop goals for the amount of energy 
                generated at Federal facilities from renewable energy 
                technologies;
                    (c) support efforts to develop standards for the 
                certification of low environmental impact hydropower 
                facilities in order to facilitate the Federal purchase 
                of such power;
                    (d) work with GSA and DLA to develop a plan for 
                purchasing advanced energy products in bulk quantities 
                for use in by multiple agencies;
                    (e) issue guidelines for agency use estimating the 
                greenhouse gas emissions attributable to facility 
                energy use. These guidelines shall include emissions 
                associated with the production, transportation, and use 
                of energy consumed in Federal facilities; and
                    (f) establish water conservation goals for Federal 
                agencies.

                Sec. 504. Within 120 days of this order, the Secretary 
                of Defense and the Administrator of GSA, in 
                consultation with other agency heads, shall develop and 
                issue sustainable design and development principles for 
                the siting, design, and construction of new facilities.

                Sec. 505. Within 180 days of this order, the 
                Administrator of GSA, in collaboration with the 
                Secretary of Defense, the Secretary of Energy, and 
                other agency heads, shall:

                    (a) develop and issue guidance to assist agencies 
                in ensuring that all project cost estimates, bids, and 
                agency budget requests for design, construction, and 
                renovation of facilities are based on life-cycle costs. 
                Incentives for contractors involved in facility design 
                and construction must be structured to encourage the 
                contractors to design and build at the lowest life-
                cycle cost;
                    (b) make information available on opportunities to 
                purchase electricity from renewable energy sources as 
                defined by this order. This information should 
                accommodate relevant State regulations and be updated 
                periodically based on technological advances and market 
                changes, at least every 2 years;
                    (c) develop Internet-based tools for both GSA and 
                DLA customers to assist individual and agency 
                purchasers in identifying and purchasing ENERGY 
                STAR and other energy efficient products for 
                acquisition; and
                    (d) develop model lease provisions that incorporate 
                energy efficiency and sustainable design.

                PART 6--GENERAL PROVISIONS

                Sec. 601. Compliance by Independent Agencies. 
                Independent agencies are encouraged to comply with the 
                provisions of this order.

                Sec. 602. Waivers. If an agency determines that a 
                provision in this order is inconsistent with its 
                mission, the agency may ask DOE for a waiver of the 
                provision. DOE will include a list of any waivers it 
                grants in its Federal Energy Management Programs annual 
                report to the Congress.

                Sec. 603. Scope. (a) This order is intended only to 
                improve the internal management of the executive branch 
                and is not intended to create any right, benefit, or 
                trust responsibility, substantive or procedural, 
                enforceable by law by a party against the United 
                States, its agencies, its officers, or any other 
                person.

                    (b) This order applies to agency facilities in any 
                State of the United States, the District of Columbia, 
                the Commonwealth of Puerto Rico, Guam,

[[Page 30859]]

                American Samoa, the United States Virgin Islands, the 
                Northern Mariana Islands, and any other territory or 
                possession over which the United States has 
                jurisdiction. Agencies with facilities outside of these 
                areas, however, are encouraged to make best efforts to 
                comply with the goals of this order for those 
                facilities. In addition, agencies can report energy 
                improvements made outside the United States in their 
                annual report to the President; these improvements may 
                be considered in agency scorecard evaluations.

                Sec. 604. Revocations. Executive Order 12902 of March 
                9, 1994, Executive Order 12759 of April 17, 1991, and 
                Executive Order 12845 of April 21, 1993, are revoked.

                Sec. 605. Amendments to Federal Regulations. The 
                Federal Acquisition Regulation and other Federal 
                regulations shall be amended to reflect changes made by 
                this order, including an amendment to facilitate agency 
                purchases of electricity from renewable energy sources.

                PART 7--DEFINITIONS

                For the purposes of this order:

                Sec. 701. ``Acquisition'' means acquiring by contract 
                supplies or services (including construction) by and 
                for the use of the Federal Government through purchase 
                or lease, whether the supplies or services are already 
                in existence or must be created, developed, 
                demonstrated, and evaluated. Acquisition begins at the 
                point when agency needs are established and includes 
                the description of requirements to satisfy agency 
                needs, solicitation and selection of sources, award of 
                contracts, contract financing, contract performance, 
                contract administration, and those technical and 
                management functions directly related to the process of 
                fulfilling agency needs by contract.

                Sec. 702. ``Agency'' means an executive agency as 
                defined in 5 U.S.C. 105. For the purpose of this order, 
                military departments, as defined in 5 U.S.C. 102, are 
                covered under the auspices of DOD.

                Sec. 703. ``Energy-Savings Performance Contract'' means 
                a contract that provides for the performance of 
                services for the design, acquisition, financing, 
                installation, testing, operation, and where 
                appropriate, maintenance and repair, of an identified 
                energy or water conservation measure or series of 
                measures at one or more locations. Such contracts shall 
                provide that the contractor must incur costs of 
                implementing energy savings measures, including at 
                least the cost (if any) incurred in making energy 
                audits, acquiring and installing equipment, and 
                training personnel in exchange for a predetermined 
                share of the value of the energy savings directly 
                resulting from implementation of such measures during 
                the term of the contract. Payment to the contractor is 
                contingent upon realizing a guaranteed stream of future 
                energy and cost savings. All additional savings will 
                accrue to the Federal Government.

                Sec. 704. ``Exempt facility'' or ``Exempt mobile 
                equipment'' means a facility or a piece of mobile 
                equipment for which an agency uses DOE-established 
                criteria to determine that compliance with the Energy 
                Policy Act of 1992 or this order is not practical.

                Sec. 705. ``Facility'' means any individual building or 
                collection of buildings, grounds, or structure, as well 
                as any fixture or part thereof, including the 
                associated energy or water-consuming support systems, 
                which is constructed, renovated, or purchased in whole 
                or in part for use by the Federal Government. It 
                includes leased facilities where the Federal Government 
                has a purchase option or facilities planned for 
                purchase. In any provision of this order, the term 
                ``facility'' also includes any building 100 percent 
                leased for use by the Federal Government where the 
                Federal Government pays directly or indirectly for the 
                utility costs associated with its leased space. The 
                term also includes Government-owned contractor-operated 
                facilities.

                Sec. 706. ``Industrial facility'' means any fixed 
                equipment, building, or complex for production, 
                manufacturing, or other processes that uses large 
                amounts of capital equipment in connection with, or as 
                part of, any process

[[Page 30860]]

                or system, and within which the majority of energy use 
                is not devoted to the heating, cooling, lighting, 
                ventilation, or to service the water heating energy 
                load requirements of the facility.

                Sec. 707. ``Life-cycle costs'' means the sum of the 
                present values of investment costs, capital costs, 
                installation costs, energy costs, operating costs, 
                maintenance costs, and disposal costs, over the 
                lifetime of the project, product, or measure. 
                Additional guidance on measuring life-cycle costs is 
                specified in 10 C.F.R. 436.19.

                Sec. 708. ``Life-cycle cost-effective'' means the life-
                cycle costs of a product, project, or measure are 
                estimated to be equal to or less than the base case 
                (i.e., current or standard practice or product). 
                Additional guidance on measuring cost-effectiveness is 
                specified in 10 C.F.R. 436.18 (a), (b), and (c), 
                436.20, and 436.21.

                Sec. 709. ``Mobile equipment'' means all Federally 
                owned ships, aircraft, and nonroad vehicles.

                Sec. 710. ``Renewable energy'' means energy produced by 
                solar, wind, geothermal, and biomass power.

                Sec. 711. ``Renewable energy technology'' means 
                technologies that use renewable energy to provide 
                light, heat, cooling, or mechanical or electrical 
                energy for use in facilities or other activities. The 
                term also means the use of integrated whole-building 
                designs that rely upon renewable energy resources, 
                including passive solar design.

                Sec. 712. ``Source energy'' means the energy that is 
                used at a site and consumed in producing and in 
                delivering energy to a site, including, but not limited 
                to, power generation, transmission, and distribution 
                losses, and that is used to perform a specific 
                function, such as space conditioning, lighting, or 
                water heating.

                Sec. 713. ``Utility'' means public agencies and 
                privately owned companies that market, generate, and/or 
                distribute energy or water, including electricity, 
                natural gas, manufactured gas, steam, hot water, and 
                chilled water as commodities for public use and that 
                provide the service under Federal, State, or local 
                regulated authority to all authorized customers. 
                Utilities include: Federally owned nonprofit producers; 
                municipal organizations; and investor or privately 
                owned producers regulated by a State and/or the Federal 
                Government; cooperatives owned by members and providing 
                services mostly to their members; and other nonprofit 
                State and local government agencies serving in this 
                capacity.

                Sec. 714. ``Utility energy-efficiency service'' means 
                demand side management services provided by a utility 
                to improve the efficiency of use of the commodity 
                (electricity, gas, etc.) being distributed. Services 
                can include, but are not limited to, energy efficiency 
                and renewable energy project auditing, financing, 
                design, installation, operation, maintenance, and 
                monitoring.

                    (Presidential Sig.)

                THE WHITE HOUSE,

                    June 3, 1999.

[FR Doc. 99-14633
Filed 6-7-99; 8:45 am]
Billing code 3195-01-P