FACT SHEET ON FEDERAL ENERGY MANAGEMENT

October 22, 1997

Aggressive energy management can substantially reduce carbon emissions from the activities of the Federal government, which has the nation’s largest energy bill at almost $8 billion per year. Significant strides have already been made --energy consumption per square foot in Federal buildings is down 15 percent and energy use in civilian and military vehicles is down about 27 percent from 1985 levels. However, we can do much more.

The initiatives below will reduce Federal emissions of greenhouse gases through enhanced focus on energy efficiency and renewable energy. They address areas which can deliver the greatest energy savings, best leverage private sector funding and improve the Federal procurement system.

1. Expand Energy Savings Performance Contracting

• Expand use of Energy Savings Performance Contracts. ESPC uses private investment capital and expertise to accomplish energy and cost saving projects in Federal facilities. When a private sector firm which has invested in federal energy efficiency improvements is fully repaid from its share of the delivered savings, all additional savings accrue to the government. Streamlined ESPC contracts put in place by DOD and DOE are beginning to speed large investments in energy projects at Federal facilities. However, use of ESPC’s is still limited in the Federal government. The Office of Management and Budget will lead an effort to increase their use. It will include new policy and budget guidance for agencies. ESPC authority can also be extended to other areas including:

• Leased Federal buildings. These include buildings where the Government either pays for the energy use directly or in other building where ESPC can provide a better lease for the Government.

• Federal mobility. There may be great potential for energy savings from more efficient energy use in aircraft, ships and vehicles.

• Water conservation. Water conservation projects save energy because each gallon contains energy from pumping, heating, chilling or treatment.

• Non-federal facilities where the Government makes indirect payment of energy expenses. These include, for example, National Guard facilities which the state owns but where the Federal Government covers utility expenses and public housing facilities which are Federally supported but owned by public housing authorities.

• State and local government facilities. Federal energy experts can help transfer ESPC techniques to state and local governments so they can access this important approach to energy efficiency.

2. Improve Federal Procurement of Energy Efficient Technology

• Accelerate the development of Product Energy Efficiency Recommendations. These cover products that are in the top 25 percent of their class for energy efficiency or have Energy Star ratings, for example electric motors and air conditioning chillers. They provide a guide to Federal purchasers of the energy efficiency level to request in a specification or procurement.

• Establish as standard practice, the purchase of energy efficient products for Government use. Traditionally, federal purchases have been based on lowest price, ignoring the substantial savings many energy efficient products can achieve over their life. The Executive Office of the President will lead an interagency team to streamline and update Executive Orders and procurement practices to encourage the acquisition of these products. Use of alternative contracting vehicles to acquire energy-efficient products will be encouraged, and purchase of products in the top 25 percent of class for energy efficiency or conforming to Energy Star standards will become standard practice, subject to necessary exceptions. The initiative will be augmented by publication of a "best practices" buying guide and expanded training of purchasing decision-makers.

• Use consolidated purchasing to stimulate markets and lower prices. Consolidated Federal purchasing can stimulate commercial markets for new and emerging products which offer greater energy efficiency, lower operating costs, and sales opportunities for small businesses that produce these products.

• Increase Federal procurement of renewable energy. In states that have implemented retail competition in their electricity industry, Federal facilities will work with their suppliers to ensure that the facilities purchase competitively supplied non-hydro renewable energy at levels equivalent to the percentage specified in that state’s retail competition legislation.

• Report Federal Agencies’ Contributions to Reduction of Carbon Emissions. This initiative will develop an appropriate measurement methodology to convert currently available data on Federal energy use to carbon emissions to aid national carbon reduction efforts.

3. Building for the 21st Century

• Establish a new level of excellence for Federal building construction and renovation that incorporates energy efficiency, quality, affordability, and sustainability. By using the latest construction techniques and tapping the knowledge of the building community and local partners, agencies will work to ensure that new Federal buildings achieve energy efficiency increases of 30-50 percent by 2000 as compared to existing facilities. This will be accomplished through a "whole building" approach that treats buildings as integrated systems rather than a series of independent component selections.

• Deploy solar technologies in Federal buildings. Show Federal leadership by installing solar photovoltaic and solar thermal systems on 20,000 Federal roofs by 2010 in support of the President’s ‘Million Solar Roof Initiative’. Utilize alternative financing methods to provide the rapid infusion of investment necessary to support the cost-effective installation of these systems.

• Expand the use of combined heat and power generation at Federal facilities. Combined heat and power makes greater use of the waste heat produced in the generation of electricity.

• Use biomass fuels in Federal boilers. Biomass would come from agricultural and wood waste and methane from landfill and treatment plant operations.

• Expand public awareness of energy efficient technologies. By showcasing energy efficient and renewable energy technologies at National Parks, Federal offices, embassies, military bases, and other facilities the public will be more aware of their potential to reduce pollution and lower costs.

• Seek increased resources for civilian agency staffing to expand energy management activities and complete energy efficiency projects. In recent years, budgets for energy management in several key agencies have been cut by more than 80 percent. These Federal appropriations often provide the most cost-effective funding for Federal energy efficiency projects.

4. Improve Aircraft, Ship, and Heavy Vehicle Fuel Efficiency

• Public-Private partnerships to improve the energy efficiency of Federal aircraft, ships and vehicles. Energy use in Federal aircraft, ships and vehicles, predominantly in the military services, is responsible for 43 percent of the $8 billion Federal energy bill. This initiative would improve the energy efficiency of main propulsion systems, with particular emphasis on medium and heavy diesel engines and high performance turbine technology. The initiative -- designed along the lines of the Partnership for a New Generation of Vehicles -- would involve a partnership between Federal agencies and the private sector. Advances under this initiative will have significant application in commercial markets. In addition, the initiative will focus on near-term energy efficiency opportunities such as lighting retrofits on ships.

• Increase the use of alternative fueled vehicles (AFVs) in the Federal fleet. Federal agencies are increasing the use of alternative fuel vehicles which, among other things, helps reduce emissions of greenhouse gases. This initiative would enhance the focus of the current program on AFVs such as electrics, hybrid-electrics, natural gas and renewable-fueled vehicles.

5. Greenhouse Gas Assessments

• Federal agencies will be required to assess their greenhouse gas emissions in major actions they undertake.