June 21, 2013

Manchin, Warner Introduce Legislation Setting State Incentives to Encourage Greater Energy Productivity

Modeled on successful ‘Race to the Top’ education competition

WASHINGTON – U.S. Sens. Mark R. Warner (D-VA) and Joe Manchin (D-WV) today introduced legislation that would establish a competitive program of voluntary federal incentives that will encourage states to adopt strategies to improve energy productivity. When implemented, the program would lower energy bills for consumers, create jobs and increase American economic competitiveness.  The “State Energy Race to the Top” initiative incorporates a national goal of doubling the productivity of U.S. electricity use by 2030, encouraging new approaches to energy productivity through a voluntary program for states and localities. It responsibly leverages limited federal funding, and it would not impose mandates.

The proposal was triggered by research that shows the United States currently wastes more energy than it uses. A whopping 57 percent of the energy flowing into our economy is simply wasted as heat, noise, and leaks, costing U.S. businesses and households an estimated $130 billion per year, according to the Alliance to Save Energy, a bipartisan group co-chaired by Sen. Warner which recommended creating, funding and implementing an energy productivity competition for states in its Energy 2030 recommendations

“America is dead last among developed nations in energy productivity. Even China ranks ahead of the U.S. Our country needs a new approach to energy that recognizes the value of improving energy productivity to increase our competitiveness,” Sen. Warner said.  “By empowering our states and local communities to take a leadership role, this friendly competition can make a difference right where it really matters.”

“America is blessed to have such an abundance of natural resources at our disposal right here, right now,” Senator Manchin said. “It is only common sense to use those resources to get the most bang for our buck, which will help create jobs here at home and improve our economic competitiveness. We owe it to the next generation to work toward energy independence. This proposal not only encourages energy efficiency, it offers states the opportunity to figure out the best ways to produce cost-effective domestic energy.” 

The legislation seeks to cut in half the energy wasted by our homes and businesses over the next 20 years.  The states with the best ideas to create jobs and lower energy bills by constructing more efficient buildings, retrofitting existing structures, upgrading inefficient appliances and other energy productivity measures would receive federal support to help make it happen.

The legislation is based on the federal “Race to the Top” framework, which is widely acknowledged to have triggered greater innovation and improved student performance in U.S. public education. “Race to the Top” has improved educational outcomes through a robust competition among 19 states, successfully raising student standards and improving teacher effectiveness in 42,000 schools serving a combined 22 million students.

The “State Energy Race to the Top” initiative empowers the federal government to challenge states and local governments to design effective programs to boost energy productivity, using a $200 million incentive fund to advance the cause. The legislation builds upon existing public/private networks, and encourages states, businesses and utilities to innovate:

  • Up to 25 states would compete for a combined $60 million to develop innovative energy productivity programs and policies.
  •  States must demonstrate how the money would be spent, how the savings and increased energy productivity will be measured, and how the public dollars can be leveraged through cooperative efforts with utilities.
  • Eighteen months after the initial allocation to 25 states, an additional $105 million would be divided among no more than six additional states to continue implementation of energy productivity efforts, including adoption of “best practices” spearheaded by the initial group of 25 states.  
  •  $25 million would be set-aside for innovative energy productivity programs proposed by public power utilities, rural electric cooperatives and utilities serving recognized Native American reservations.
  • The National Research Council would be required to produce an independent evaluation of the program’s performance.

According to the Alliance to Save Energy, doubling U.S. energy productivity over the next 20 years would create an estimated 1.3 million American jobs, cut carbon emissions and oil and gas imports by one-third, and boost America’s overall annual economic output by two-percent.