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02/15/2013 07:27 AM     print story email story  

Pointless Delays In Energy Efficiency Standards Mean $3.7 Billion in Lost Savings

SustainableBusiness.com News

President Obama says addressing climate change is smart economic policy as well as a moral imperative, but his administration keeps delaying stronger appliance and equipment energy-efficiency standards.

These standards are among the most successful ways to quickly cut energy consumption and contribute to economic growth. They create hundreds of thousands of jobs and save billions of dollars on utility bills across the economy.

In 2010, existing standards cut US electricity use 7%, and that will rise to 14% by 2035 as people buy the new products.  It also created 340,000 jobs! Upgrading and add new standards would shave another 7% off electricity use by 2035.

Over the past two years, the administration has missed deadline after deadline for completing new or updated standards for products ranging from microwave ovens to commercial refrigerators to industrial motors. These delays impose a steep cost. 

Eight standards are currently held up, costing individuals and businesses $3.7 billion and 40 million metric tons of excess carbon emissions, according to the Appliance Standards Awareness Project (ASAP) and American Council for an Energy-Efficient Economy (ACEEE).

In fact, every month of delay adds another $300 million in lost savings and another 4.4 million metrics tons of carbon emissions, equivalent to burning 19,000 rail cars of coal.

Raising efficiency standards also spurs innovation as manufacturers compete to introduce the most advanced equipment at the lowest cost. Delays in issuing standards compounds over time because it takes a long time for manufacturers to develop new products.

Here are the standards that are delayed, along with the cost in both lost savings and additional carbon emissions: 

  • Microwave Ovens (20 months overdue) - $276 million in lost saving, 2.1 million metric tons of carbon (mmt)
  • External Power Supplies (19 months) - $370 million, 4.2 mmt
  • ER, BR and Small Diameter Reflector Lamps (21 months) - $1.05 billion, 7.7 mmt
  • Walk-in Coolers and Freezers (16 months) - $1.1 billion, 10.3 mmt
  • Metal Hallide Lamps (16 months) - $261 million, 3.2 mmt
  • Distribution Transformers (4 months) – $347 million, 6.1 mmt
  • Electric Motors (4 months) - $202 million, 4.2 mmt
  • Commercial Refrigeration Equipment (4 months) - $92 million, 1.2 mmt

Bureaucracy to Blame

The Department of Energy (DOE) develops standards and then the White House Office of Management and Budget's Office of Information and Regulatory Affairs (OIRA) reviews the new rules to make sure their benefits exceeds their costs.

Cass Sunstein, who headed the OIRA until recently, touted appliance standards as an example of smart regulations for which "the monetary benefits dwarf the costs."

But OIRA has been reviewing DOE's new standards for a year or more and there's now a backlog.

It wasn't always this way. Soon after taking office in 2009, President Obama declared his Administration would prioritize new efficiency standards, and within a few months later, he announced historic standards for commercial lighting products. 

Under Chu's leadership, DOE fulfilled a 2006 court order to catch up on 22 overdue standards from previous administrations.

Some of DOE's recent important new efficiency standards are for refrigerators, clothes washers and dishwasherscentral air conditioners, furnaces and heat pumps.

National energy efficiency standards for common household and business products generated about 340,000 jobs in 2010.

Last December, Congress passed the American Manufacturing Technical Corrections Act (HR 6582). Among other things, the new law amends several equipment efficiency standards already enacted by Congress and reduces barriers to industrial energy efficiency.

Download the analysis:

Website: www.appliance-standards.org/sites/default/files/The_Cost_of_Overdue_Energy_Efficiency_Standard_Jan_2013_0.pdf



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