The Role of Energy Efficiency in Deep Decarbonization
| Date | 01 January 2018 |
| Author |
48 ELR 10030 ENVIRONMENTAL LAW REPORTER 1-2018
A R T I C L E S
The Role of
Energy Efficiency
in Deep
Decarbonization
by Kit Kennedy
Kit Kennedy is Director of the Energy &
Transportation Program at the Natural Resources
Defense Council in New York City.
Summary
e Deep Decarbonization Pathways Project Report
calls for major increases in building and equipment
eciency to reduce U.S. greenhouse gas emissions by
at least 80 percent from 1990 levels by 2050. While
the U.S. Department of Energy eciency standards
program is one of the most successful U.S. policies in
driving energy savings, carbon reductions, and con-
sumer savings, it will need to be made even stronger
and an integrated suite of additional and more ambi-
tious energy-eciency laws and regulations at the
federal, state, and local level will be needed to meet
this goal. Additional action from private actors, such
as utilities and businesses, will also be necessary. is
Article, excerpted from Michael B. Gerrard & John C.
Dernbach, eds., -
(forthcoming in 2018 from
ELI Press), discusses the various legal and policy path-
ways at the federal, state, and local levels to ensure that
the energy eciency of residential, commercial, and
industrial products continues to improve at the scale
and speed necessary to meet the “80% by 2050” goal.
I. Introduction
e Deep Decarbonization Pathways Project (DDPP)
report emphasizes t he major increase in building and
equipment eciency that will be needed to reduce U.S.
greenhouse gas (GHG) emissions by at least 80% from
1990 levels by 2050.1 is Article will discuss lega l and
policy pathways at the federal, state, and local levels to
ensure that the energy eciency of residential, commer-
cial, and industrial products, including lighting, consumer
electronics, and computer servers, continues to improve at
the scale necessary to meet this “80% by 2050” goal.
e DDPP policy repor t obser ves that in a decarbon-
ized energy system, investment in c lean te chnologies
such as high-e ciency appliances and equipment will
need to increas e sixfold in residential build ings and triple
in c ommercial buildings.2 e DDPP polic y report also
notes that some of the fundamental paradigms behind
energy-eciency standards and other energ y-eciency
policies will need to adjust in order to help drive deep
decarbon ization. ese include such potentia l c hanges
as shifting from a focus on reducing primary energy use
to a focus on reducing carbon emissions, a nd incentiv-
izing fuel s witching from fos sil fuel-derived natura l g as
to renewable g as and ele ctrication, as the electric g rid is
increasingly deca rbonized.
Today, residential appliances, commercial appliances,
industrial equipment, and lighting products account for
a signicant percentage of U.S. energy use and carbon
emissions.3 e residential and commercial end-use sectors
1. J H. W ., E E E,
I. ., P D D U S,
US 2050 R, V 1: T R xiv (2015), available at
http://usddpp.org/downloads/2014-technical-report.pdf. A 2017 Natu-
ral Resources Defense Council (NRDC) report,
(Vignesh Gowrishankar
& Amanda Levin), available at https://www.nrdc.org/resources/americas-
clean-energy-frontier-pathway-safer-climate-future, nds even greater po-
tential for energy eciency. e NRDC report concludes that the United
States can meet its 2050 climate goals based primarily on clean energy tech-
nologies, including by implementing energy-eciency technologies and
systemwide approaches to reduce total U.S. energy demand by 40%.
2. J H. W ., E E E,
I. ., US 2050 R, V 2: P I D
D U S 24 (2015), available at http://
usddpp.org/downloads/2015-report-on-policy-implications.pdf. In resi-
dential buildings, investment in clean technologies will increase from $35
billion annually today to $220 billion in 2050, and in commercial build-
ings, the increase will be from $70 billion annually today to $210 billion
annually in 2050.
3. Residential appliances comprise products used in the home such as refriger-
ators, air conditioners, clothes washers, and dishwashers. Commercial prod-
Copyright © 2018 Environmental Law Institute®, Washington, DC. Reprinted with permission from ELR®, http://www.eli.org, 1-800-433-5120.
1-2018 NEWS & ANALYSIS 48 ELR 10031
accounted for 21% and 18%, respectively, of carbon diox-
ide (CO2) emissions from fossil f uel combustion in 2014.4
Both sectors rely chiey on electricity for meeting energy
demands, with 68% and 75%, respect ively, of their emis-
sions attributable to electricity consumption for lighting,
heating, cooling, and operating appliances; the remaining
emissions were due to natural gas and petroleum consump-
tion for heating and cooking.5 Carbon emissions from the
residential and commercial sectors have increased by 16%
and 24%, respectively, since 1990.6 e increase in carbon
emissions from the residential sector reects an increase in
the number of U.S. households and associated square foot-
age. Energy intensity per household has declined during
this period due in la rge part to increased energy eciency
of household products; structural shifts in the residential
sector also play a large part.7
In both the residential and commercial sectors, growth
in electricity consumption has slowed over the past 15 years
and is expected to slow even further. Residential electricity
sales grew just 1.1% per year from 2000-2015, according
to the U.S. Energ y Information Administration (EIA) of
the U.S. Department of Energy (DOE).8 In its 2016 refer-
ence case, EIA predicts that residential sales will grow at an
even lower rate, just 0.3% per year through 2040, noting
that increases in residential eciency, particularly in light-
ing (as well as increased deployment in rooftop solar), will
oset expected growth in the number of U.S. households
and increased electricity use for cooling and other miscel-
laneous uses.9
Commercial-sector electricity sa les also grew just
1.1% per year from 2000-2015 and EIA predicts that
the growth rate will decline to 0.8% annua lly through
2040 as energ y-eciency improvements in lighting and
ucts comprise products used in businesses such as commercial air condition-
ing systems and walk-in coolers and freezers. Industrial products comprise
products used in manufacturing such as motors and air compressors.
4. U.S. E P A, I U.S. G-
G E S: 1990-2014, at 2-13, ES-12 (2016) (EPA
430-R-16-002) (explaining that electricity consumption for lighting, heat-
ing, cooling, and operating appliances accounts for 68% and 75%, respec-
tively, of carbon emissions from the residential and commercial end-use
sectors, which respectively account for 21% and 18% of U.S. carbon emis-
sions from fossil fuel consumption), available at https://web.archive.org/
web/20160808153417/https://www3.epa.gov/climatechange/Downloads/
ghgemissions/US-GHG-Inventory-2016-Main-Text.pdf.
5. Id.
6. Id.
7. U.S. E I A, D U.S. H-
E C, 1980-2009 (2015), available at https://
www.eia.gov/analysis/studies/buildings/households/ pdf/drivers_hhec.pdf.
Note that the U.S. Energy Information Administration (EIA) reference case
includes implementation of the Clean Power Plan.
8. EIA, A E O 2016 E R: A S-
T C 18 (2016), https://www.eia.gov/outlooks/aeo/er/
pdf/0383er(2016).pdf.
9. Id.; see also EIA,
Sectors, T E, Apr. 29, 2015, http://www.eia.gov/todayinen-
ergy/detail.cfm?id=21012.
refrigeration, increased deployment of on-site solar, and
commercial combined heat and power (CHP) systems
partia lly oset electricity increases from computers and
miscella neous u ses.10 For the industrial sector, electricity
sales increased by 0.7% per year from 2000-2015 and EIA
predicts that industrial electricity sales will increase by
1.1% per year from 2015-2040 due to expected increases
in industria l activity.11
e challenge addressed in this A rticle is to identify
legal pathways to improve the eciency of residential,
commercial, and industrial appliances and equipment at
much faster rates than EIA assumes in order to achieve
the U.S. decarbonization goals set fort h in the DDPP.
e primary focus is on mandatory energy-eciency stan-
dards at the federal and state levels. e DOE standards
program, described in Part II, is one of the most success-
ful U.S. energy-eciency policies in driving energy sav-
ings, carbon reductions, and consumer savings. Further
strengthening federal and state energy-eciency standards
will play a critical role in driving the needed eciency
investments. Appliance, product, and equipment eciency
standards (often simply referred to as “appliance standards”
or “energy-eciency standards”) require that specic prod-
ucts achieve a minimum level of energy or water eciency.
At the national level, these standards are set either by the
U.S. Congress or DOE, and are then periodically reviewed
and updated by DOE.
e federal energy-eciency standards program covers
consumer, commercial, and industrial products, as well as
lighting in all t hree categories.12 Under federal law, federal
eciency sta ndards generally preempt state standards for
federally regulated products, with some signicant excep-
tions, as discussed in Part II.D. But a number of states
currently maintain active programs mandating minimum
eciency levels for products not covered by the federal
program and these programs have also proven successful.
Establishing enforceable, minimum energy-eciency stan-
dards for appliances and products helps to overcome mar-
ket barriers to energy eciency, including consumer lack
of information and “split incentives” such as the diering
economic incentives with respect to energy eciency for
landlords, who tend to purchase appliances for their ten-
10. Id.
11. Id.
12. Consumer products covered under the Energy Policy and Conservation Act
(EPCA) can be found at 42 U.S.C. §6295. e statute denes a “consumer
product” as a product that “in operation consumes, or is designed to con-
sume, energy or ... water; and ... which, to any signi cant extent, is dis-.. water; and . .. which, to any signi cant extent, is dis-. water; and ... which, to any signi cant extent, is dis-.. which, to any signi cant extent, is dis-.. which, to any signi cant extent, is dis-. which, to any signi cant extent, is dis-. which, to any signicant extent, is dis-
tributed in commerce for personal use or consumption by individuals.” Id.
§6291(l). Commercial and industrial products covered by EPCA are found
at EPCA §§342 and 346 and 10 C.F.R. pt. 431. “Industrial equipment” in-
cludes products that (1)in operation consume, or are designed to consume
energy; (2)are distributed in commerce for industrial or commercial use to
any signicant extent; and (3)are not covered under the consumer product
program. 42 U.S.C. §6311(2)(A)(i).
Copyright © 2018 Environmental Law Institute®, Washington, DC. Reprinted with permission from ELR®, http://www.eli.org, 1-800-433-5120.
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