Details of the Clean Energy Incentive Program
Under its final Clean Power Plan (CPP), the U.S. Environmental Protection Agency (EPA) established the Clean Energy Incentive Program (CEIP) to encourage early action in meeting CPP objectives. The CEIP is a voluntary program for states to incentivize renewable and energy efficiency projects by giving them assets that will be tradable in Clean Power Plan markets. On June 16, 2016, EPA proposed design details for the CEIP.
This fact sheet has been developed by C2ES in support of the Alliance for a Sustainable Future, in partnership with The United States Conference of Mayors. For more information about the Alliance, see: http://www.allianceforasustainablefuture.com
Spring is the season of renewal, making it the perfect time to re-evaluate and refresh how we go about living and working sustainably on the planet. Turn over a new leaf this spring by trying any or all of the following five suggestions for treading more lightly on the earth.
- Avoid waste: What we buy and discard creates tons of waste and greenhouse gas emissions. The average American creates 4 pounds of trash daily. Keep would-be-waste to a minimum by making smart choices before you consume. Here are three tips: BYORM (bring your own reusable mug) to your favorite drink shop; carry reusable bags when shopping; or use Pyrex, Tupperware or reusable snack bags for leftovers after dining out.
- Mix up your commute: Are you one of the millions of Americans who drive nearly 30 miles a day – more often than not alone? Try a new way to get where you’re going. Use bike shares, take public transportation, join a carpool or try an uberPOOL.
- Grow your curb appeal: With spring around the corner, it is a fine time to add native trees and other plants to your yard or community garden. This greenery will capture carbon dioxide, the primary greenhouse gas contributing to climate change. Once established, native plants are low-maintenance and survive well on available water. They also enhance the look of your home or community. For more tips, check this guide to native plant gardening.
Most people can agree that being efficient consumers of energy is a good thing. And yet encouraging energy efficiency can be challenging, in part because the potential audience can be huge and diverse, and in part because making a change, even if it saves you money, typically requires effort.
That’s why it’s essential to find the people who are most likely to give energy-efficiency programs a try. Intelligent use of customer data can help target and inform a receptive audience. Members of this audience will then be encouraged to take action with some motivation.
I recently moderated a panel at the Behavior Energy and Climate Conference in Washington, D.C., where three experts discussed innovative ways to strategically target energy-efficiency programs, address factors that make people hesitant to join, and then scale the program.
Talk about a win-win. The U.S. Environmental Protection Agency (EPA) and government-backed mortgage provider Freddie Mac recently agreed on a plan that will cut carbon emissions and at the same time make rental housing more affordable.
The plan will make it easier and cheaper for property owners to get loans for energy efficiency upgrades. This is a big deal because studies estimate that increasing the efficiency of U.S. multifamily rental properties could deliver as much as $9 billion in energy savings by 2020. It could also reduce greenhouse gas emissions by 35 million metric tons – the equivalent of taking 7.2 million cars off the road or shutting down 10 coal-fired power plants.
With studies showing that rental properties are generally less efficient per square foot than owner-occupied homes, helping renters and their landlords save energy (and money) is a key step toward reducing overall U.S. energy use.
The EPA-Freddie Mac initiative, part of the president’s Climate Action Plan, also will make available more data on energy and water use in multifamily properties. Tenants will better understand the energy costs of living in a particular home, letting them make more informed decisions. And owners will have a new incentive to make their properties more efficient, and therefore more appealing to potential renters. Additionally, property owners and tenants alike will be able to see how efficient their properties are compared to others.
EPA and Freddie Mac aren’t the only ones working to address this challenge. C2ES, through the Make an Impact program, has launched a web-based effort to reach out to renters with customized energy efficiency information. (Read about it in this blog.)
On-bill programs allow building owners and occupants to pay for clean energy investments over time through an additional charge on utility bills.
On-bill programs have mostly focused on energy efficiency measures, though renewable energy and water efficiency projects may be eligible as well. Such projects often come with a high upfront cost that many people, businesses, and institutions cannot easily afford. On-bill programs can mitigate this problem because an administering utility or a third party covers the upfront cost of the clean energy installations. A customer’s history of utility bill payment can help to establish credit, and the customer may see little or no net increase in the monthly bill due to expected reductions in energy consumption. Generally, non-repayment will lead to a shutoff in utility service, which deters defaults and can make the loan provider more confident in repayment.
There are two general types of on-bill programs:
- On-bill financing (OBF) – a utility incurs the cost of clean energy upgrades and is repaid by the customer.
- On-bill repayment (OBR) – a third party (not the utility) provides the capital for a clean energy upgrade and is repaid by the customer through a utility bill.
On-bill programs vary by state and by provider, and each program has its own terms and process. Programs may be available to residential, commercial, industrial, and/or institutional customers depending on the state and utility policies. In those states with legislation that requires utilities to offer OBF, generally it is only obligatory for investor-owned utilities (IOUs). Administration of on-bill programs also varies; programs may be administered by the utility itself, a nonprofit organization, or a government entity. Some programs feature a discounted or zero interest rate. Initial investment funds for on-bill programs can come a variety of sources from utility ratepayers, government grants, or other funding sources. The American Recovery and Reinvestment Act of 2009 (ARRA) provided a significant amount of funding for OBF.
Most participants in on-bill programs begin the program with an audit of the building to determine if energy efficient upgrades would be cost-effective. Some programs require all upgrades to be “bill-neutral.” Bill-neutrality occurs when the savings accrued by the decreased energy use will be equal to or greater than the monthly repayment amount.
Certain on-bill programs may also have the characteristic of being “tied to the meter,” meaning that responsibility of repayment lies with the current resident of the building, rather than forever with the resident who instigated the financing. This allows for flexibility for residents who wish to move or sell their home.
The states are organized into the following policy categories:
1. State-Required On-Bill Financing or State-Launched On-Bill Program: These states have passed laws or public utilities commission orders that require utilities statewide (usually only large or investor-owned utilities) to provide an OBF program or directed a state agency to set up an on-bill program. Program specifications, such as loan terms, program size, and customer eligibility vary from state to state.
2. State-Supported On-Bill Programs: These states have passed laws or public utilities commission orders that authorize and/or support the implementation of OBF or OBR state-wide, but do not require any utilities to offer on-bill programs. These include policies that remove legal barriers or establish funds to offering on-bill programs.
3. Preliminary On-Bill Program Policy: These states’ public utilities commissions have ordered the establishment of pilot on-bill programs or commissioned research or working groups to analyze the feasibility of on-bill programs.
4. On-Bill Financing Offered by Individual Utilities: Utilities in some states have voluntarily created OBF programs without direction from local or state government. In some states, utilities can earn money from reducing overall demand. Energy efficiency can also be a way to reduce peak loads and thus generation costs.
To learn more about On-Bill Financing programs, please see the C2ES On-Bill Financing Brief.
Teaching students how to save energy and help the environment provides lessons that can last a lifetime. That’s the biggest takeaway of our third annual Change Our 2morrow (CO2) Schools’ Challenge.
The 2013 Schools’ Challenge, an initiative of Alcoa Foundation and the Center for Climate and Energy Solutions’ Make an Impact program, took place last month in seven schools across five states. Thousands of middle school students, their teachers, families and community members participated in interactive lessons, completed an energy-saving pledge list, and calculated their carbon footprint as part of the month-long program. Collectively, 10,433 people committed to take actions in their daily lives that will save more than 21 million pounds of carbon dioxide emissions. That’s equivalent to taking 2,000 cars off the road for one year.
As we plunge into the holiday shopping season, take a minute to think about the things you can do to make searching for the perfect gift a little friendlier on the planet (and your wallet).
Here are nine ideas for making the holiday season a little greener and less stressful. Try one. And get more information on how you can save energy and help the planet at http://makeanimpact.c2es.org/
House and Senate Energy Efficiency Standards bill and amendments
On September 22, 2012, its last day before the November elections, the U.S. Senate passed a bill that combined energy efficiency measures from both the Senate (S.1000) and the House of Representatives (H.R.4850). Some version of the bill may be enacted during the "lame duck" session of Congress between the elections and the end of the year.
In the Senate Energy and Natural Resources Committee (September 2011):
The Energy Savings and Industrial Competitiveness Act, S.1000, introduced by Sens. Jeanne Shaheen (D-NH) and Rob Portman (R-OH), would promote the use of energy efficient technologies. Some of the highlights of the bill include: strengthening building codes for homes and commercial buildings by requiring them to be more energy efficient; facilitating energy efficient upgrades by manufacturers; establishing loan programs at the Department of Energy (DOE) to fund the development and commercialization of innovative energy efficient technology and processes for industrial applications; supporting private investment in energy efficient technologies as a result of joint ventures between DOE and private sector partnerships; and requiring the Federal Government – the single largest energy user in the country – to adopt energy saving techniques and advanced metering technologies to better manage the energy usage of government buildings. The bill passed the Senate Energy and Natural Resources committee in September 2011.
In the House (June 2012):
The Enabling Energy Savings Innovations Act, H.R.4850, sponsored by Rep. Robert Aderholt (R-AL), would allow the Secretary of Energy to waive insulation standards placed on some components of walk-in coolers and freezers as set by the Energy Policy and Conservation Act (EPCA) of 1975. Current federal regulations on refrigeration units are believed too restrictive to be met even with components that meet or outperform the DOE energy efficiency standards. H.R. 4850 was introduced in April, 2012, passed the House of Representatives by voice vote on June 26, 2012, and was sent to the Senate.
In the Senate (September 2012):
On September 22, the Senate passed H.R.4850 with two amendments. The first, (S.Amdt.2862), a provision of S.1000, would direct the Secretary of Energy to report to Congress on the deployment of industrial energy efficiency within one year of the enactment of the Act, and to submit guidance on how to remove barriers to deployment of energy efficient technologies. The amendment would also direct the Secretary of Energy to conduct a study of the advanced energy technology capabilities of the United States while specifically enumerated government programs would be directed to develop collaborative partnerships to support research and development of technologies that reduce emissions. Additionally, the amendment would set federal energy management and data collection standards, including a web-based tracking system to certify compliance with certain energy and water measures. It would also direct the Secretary of Energy, in consultation with the Secretary of Defense, and the General Services Administration to report to Congress on the best energy practices in Federal facilities. Moreover, the amendment would require a study of the perceived economic benefits of providing the industrial sector with Federal energy efficiency matching grants, and estimated energy and emission reductions. Sen. Jeanne Shaheen (D-NH) and Sen. Rob Portman (R-OH) co-sponsored this amendment. (Sen. Pryor (D-AR) offered the amendment on behalf of Sen. Shaheen on the Senate floor.) The second amendment (S.Amdt.2861), sponsored by Sen. Jeff Bingaman (D-NM) (also offered by Sen. Pryor) would set a uniform efficiency descriptor, a way to quantify and measure energy efficiency, for covered water heaters/water heating technologies.
In the House (December 2012):
On December 4, 2012, during the "lame duck" session, the House passed H.R. 6582, the ''American Energy Manufacturing Technical Corrections Act'' by a 398-2 vote. Sponsored by Rep. Robert Aderholt (R-AL), the bill combines language that the House and Senate have approved earlier this year (see above) on various energy efficiency provisions, including some language from the Senate's Shaheen-Portman efficiency package (see above, S.1000). The House bill approved such measures as establishing best practices for "smart" electric meters in the federal government, as well as setting federal energy management and data collection standards. Section 3 of the bill, The Uniform Efficiency Descriptor for Covered Water Heaters section, would ease regulatory burdens by directing the Department of Energy (DOE) to transition from having separate definitions for two types of water heaters, to having a single definition for all covered water heaters. Rep. Henry Waxman (D-Calif.) backed the bill but called for more legislation in the new Congress.
In the Senate (December 2012):
On the evening of December 6, 2012, the Senate passed H.R. 6582 unanimously, without any amendments. (See section direcly above for a description of H.R. 6582).
Presidential Signature (December 2012):
On December 18, President Obama signed H.R. 6582 into law.
Over the past few weeks, college students have been shedding light on the future of solar energy on the National Mall in Washington, D.C. Out of 19 teams from around the globe and 10 energy performance and livability contests, one overall winner emerged at the recently held U.S. Department of Energy 2011 Solar Decathlon. The winning WaterShed home design, built by students from the University of Maryland, was inspired by the Chesapeake Bay ecosystem. The house included a 9.2 kilowatt rooftop solar array and prominently featured storm water management and recycling components, such as a butterfly roof and pollution filtration.
“All kids growing up in this generation know how they’re impacting the environment. We’re teaching today’s kids about recycling and being responsible.”
- Shawn Kerr, eighth-grade science teacher at Alcoa Middle School in Alcoa, TN.
Fifteen schools participated in the Make an Impact: Change Our 2morrow (MAI CO2) schools’ challenge, an educational energy conservation competition led by the Center’s Make an Impact (MAI) initiative in partnership with Alcoa. Mr. Kerr’s words sum up the program’s outcome, in which Make an Impact, a corporate employee and community engagement program, expanded the reach of its energy efficiency message to middle and high schools in five Alcoa communities across four states this spring.
|Alcoa Middle School principle Jim Kirk holds up the $1,000 check that the school won for being named a regional runner-up in the MAI: CO2 schools’ challenge.|
We had high hopes for the MAI CO2 campaign, but our success at engaging a younger audience in acting on energy efficiency far exceeded our expectations. In one month, we reached more than 8,000 students/parents/teachers and motivated them to calculate their carbon footprint with the Make an Impact calculator. The program wasn’t just about students realizing their impact on the earth; we also tried to teach and empower these young individuals to make a difference – by saving energy, money, and the planet. Between March 14 and April 11, participants identified more than 14.4 million pounds of potential carbon savings and an estimated $1.75 million in energy savings.