Tag: Energy Policy

EPA Releases ENERGY STAR Guidance on Building Operations Impacted by COVID-19

Posted on by Trey Jackson

The U.S. Environmental Protection Agency (EPA) announced ENERGY STAR program guidance this week to reflect changes in building operations due to the COVID-19 pandemic. The guidance was developed after EPA sought input from The Roundtable’s Sustainability Policy Committee Advisory Committee (SPAC).

  • The EPA guidance – “Has COVID-19 affected ENERGY STAR certification?” – impacts real estate industry practices regarding the web-based “Portfolio Manager” tool used by more than 450,000 properties (or nearly 45% of U.S. commercial building space) to measure, benchmark, and track energy, water, and waste management in buildings. “Portfolio Manager” is a voluntary platform at the federal level for private sector buildings although a number of state and local laws mandate its use in major markets.  
  • EPA explained that building owners and managers should update Portfolio Manager “use details” to reflect changes in occupancy and operations that may have occurred since the start of the pandemic – for both the numbers of workers in a building and the asset’s weekly operating hours. (Point #1 in EPA’s guidance)  The agency also provided practical instructions on how to update such “worker numbers” and “hours of operation” details in the Portfolio Manager tool.
  • When merged with data on a building’s actual energy consumption, these “use details” are key variables to determine a 1-100 ENERGY STAR rating that allow investors, tenants, regulators, and other audiences to assess an asset’s energy performance compared to like-kind buildings.
  • EPA staff sought input on these matters at SPAC’s “virtual meeting” on June 12, which was held in conjunction with The Roundtable’s remote Annual Meeting (Roundtable Weekly,  June 12).  SPAC members were surveyed for their recommendations about how ENERGY STAR should address changes in building operations during the pandemic. The committee’s preferred option is now reflected in EPA’s latest guidance. 
  • EPA plans to issue additional guidance (expected in September) to advise owners and managers on how to apply for ENERGY STAR certifications that may be awarded to buildings in 2020. (Point #3 in EPA’s guidance) The key clarification in this week’s announcement is that updating “use detail” data to reflect COVID-era operations is prerequisite for the ultimate ENERGY STAR “label,” which may be granted for a building that ranks “75” or higher on EPA’s scale.
  • This week’s guidance is the latest example of longstanding cooperation between the ENERGY STAR program and SPAC.  It follows collaborations to update the technical models that EPA currently uses to “score” buildings  (Roundtable Weekly, July 19, 2019). SPAC also assisted the agency with developing the “ENERGY STAR Tenant Space” program to recognize high performance design and construction of leased office.  (Roundtable Weekly, June 15, 2018) 
  • In related news, EPA opened its process for 2021 ENERGY STAR awards this week.  Applications must be submitted by December 9, 2020 and can be downloaded here.

SPAC is led by Chairman Anthony E. Malkin (Chairman, President, and CEO, Empire State Realty Trust) and Vice Chairman Daniel Egan (Senior Vice President, Energy & Sustainability, Vornado Realty Trust).

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Senate Committee Considering Comprehensive Energy Bill that Includes Roundtable-Supported Measures

Posted on by Trey Jackson

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A bipartisan, omnibus energy bill with provisions supported by The Real Estate Roundtable was prepared for debate in the Senate this week, as Republicans and Democrats negotiate a package of amendments that may be added to the base bill.  

  • The American Energy Innovation Act (S. 2657) – introduced on Feb. 27 by Senate Energy and Natural Resources Committee Chairman Lisa Murkowski (R-AK) and Ranking Member Joe Manchin (D-WV) [ above ] – is a compilation of more than 50 energy-related measures considered and individually reported last year.  (Bill Summary and text)
     
  • The AEIA focuses on energy efficiency, renewable energy, energy storage, carbon capture, grid modernization, and workforce development to build energy-related infrastructure.
     
  • The bill includes language supported by The Roundtable to improve the Commercial Building Energy Consumption Survey (CBECS) process. 
    • AEIA Section 1001 would require Congress to oversee coordination by federal agencies to gather and report higher quality CBECS data – the only nationwide government survey that estimates the number, location, age, energy consumption and other characteristics of the U.S. commercial real estate stock.
    • Significantly, CBECS data provides the underpinning for EPA’s ENERGY STAR scores – a key real estate performance “label” relied upon by building owners, investors, and tenants.
  • The Senate’s AEIA bill includes other sections of interest to real estate, including authorizations for:  
    • a “Federal Smart Building Program” to implement and demonstrate smart building technologies across the federal real estate stock; 
    • a nationwide survey of “Private Sector Smart Buildings” for study and evaluation by the U. S. Energy Secretary; 
    • codification of the U.S. Energy Department’s “Better Buildings Challenge” – a program that has attracted Roundtable members’ participation; and
    • a “CHP Technical Assistance Partnership” to provide project-specific engineering and economic assessments for combined heat and power systems.

     

  • Thus far, Senators have filed over 185 amendments for consideration as additions to the underlying bill.  Among them is one offered by Senators Rob Portman (R-OH) and Jeanne Shaheen (D-NH) to drive greater transparency and consideration of building owner costs in the process to develop model building energy codes.  (Roundtable Weekly, July 19, 2019).   The Roundtable has long-supported the Portman-Shaheen energy codes provisions, which Portman addressed this week on the Senate floor. 
  • ENR Chairman Murkowski said this week she was working on a “managers’ package” of certain, less controversial measures to be voted on in a block.  “I want to have a managers’ package, but it is entirely possible — we’ve seen it before — that that opportunity is spoiled,” she said.  (CQ, March 4) 

If Republicans and Democrats can agree upon the AEIA amendments eligible for a vote, the Senate will be poised to pass its first major piece of energy legislation in over 12 years, according to Murkowski’s press release.  The measure would then move to the House of Representatives, where the Democratic majority might append provisions that more aggressively address climate change.  (Roundtable Weekly, Feb. 7, 2020) 

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House Hearing Considers Roundtable-Supported Energy Efficiency Legislation

Posted on by Trey Jackson

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In the lead-up to the November elections, Democrats continued to draw attention this week on Capitol Hill to energy and climate issues, as the House Energy Subcommittee heard testimony on a number of bills to advance efficiency in buildings and modernize the nation’s electric grid.  (Subcommittee hearing and memorandum, Feb 12.)

  • The Subcommittee’s review included the Energy Savings and Industrial Competitiveness (ESIC) Act (H.R. 3962), long supported by The Real Estate Roundtable.  The bipartisan bill is sponsored by Representatives Peter Welch (D-VT) and David McKinley (R- WV), and is the companion to a Senate version (S. 2137) championed by Senators Rob Portman (R-OH) and Jeanne Shaheen (D-NH).  The Senate measure passed its committee in Sept. [Roundtable Weekly, Sept. 27]
  • In The Roundtable’s Feb. 11 ESIC Act support letter to House leaders, President and CEO Jeffrey DeBoer noted that,  “[t]he U.S. real estate sector has made significant strides to improve the energy efficiency and reduce the carbon footprint of America’s building infrastructure over the last decade.”  He further described how H.R. 3962 would advance the industry’s energy efficiency efforts.  (Roundtable House ESIC Act letter, Feb. 11)
  • The ESIC Act would improve the current process to develop “model” building energy codes with new “open government” provisions. Real estate and other stakeholders would be provided a platform to comment on the federal government’s influential role in the codes process, compelling the U.S. Department of Energy (DOE) to consider cost effectiveness when the agency develops efficiency recommendations for new construction and major retrofits.  DOE would also be required to assess the small business impacts of its energy code recommendations.
  • The ESIC Act would further direct the U.S. Energy Information Administration (EIA) to coordinate with the Environmental Protection Agency’s ENERGY STAR program, when EIA periodically gathers significant nationwide data related to energy consumption in U.S. buildings.
  • In addition, the ESIC Act includes innovative provisions – known as the SAVE Act – to assist home buyers with financing energy efficiency improvements as part of the residential mortgage underwriting process.
  • Among the witnesses at the Wednesday House hearing was Lowell Ungar, senior policy advisor for the American Council for an Energy-Efficient Economy (ACEE), who  testified in support of H.R. 3962.  Mr. Ungar also spoke at the recent Sustainability Policy Advisory Committee (SPAC) meeting on January 29, regarding the estimated economic and environmental benefits of an accelerated depreciation tax strategy known as “E-QUIP” to motivate “retrofit” project installations of high performance HVAC, windows, lights, and other building equipment.  The Roundtable and coalition partners continue to work toward introduction of an E-QUIP bill in the coming months.  (E-QUIP Coalition Letter, May 8, 2019).
  • The ESIC Act’s building codes provisions – allowing for consideration of financial impacts on businesses and homeowners – contrasts to a recent climate framework released by Democratic leaders.

While the parties’ respective visions on energy and climate policy are coming into sharper focus in advance of next November’s elections, prospects for passing omnibus legislation that clears both the House and Senate this year are low.

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House Ways and Means Committee Signals Green Energy Tax Bill; Trump Administration Developing “Tax 2.0” Proposal

Posted on by Trey Jackson

House Ways and Means Committee Chairman Richard Neal (D-MA) recently confirmed plans to advance legislation in 2020 that would expand and create new renewable energy and energy-efficiency tax incentives.  “We talked about (the markup) this morning,” Neal told reporters on Jan. 14. He added, “We are scheduling events.” (BGov, Jan. 15 and Jan. 24) 

  • The starting point for green energy tax legislation in the Ways and Means Committee is likely a draft bill unveiled last November by Rep. Mike Thompson (D-CA), who chairs the Subcommittee on Select Revenue Measures. 
  • Rep. Thompson’s discussion draft of the Growing Renewable Energy and Efficiency Now (GREEN) Act would modify the enhanced deduction for energy-efficient commercial building property (section 179D);create an expanded tax credit for the developers of new, energy-efficient home (section 45L); and modify the tax credit for energy-efficient improvements to existing homes (section 25C).  (Roundtable Weekly, Nov. 22) (Rep. Thompson news release with link to the GREEN tax draft legislation, Nov. 19) 
  • The Real Estate Roundtable and other real estate and environmental organizations are encouraging Members of Congress to consider an additional proposal that would incentivize existing buildings to purchase and install energy-efficient upgrades that reduce greenhouse emissions, generate taxpayer savings, and spur innovation and investment.    
  • Specifically, draft legislation under review would create a new category of energy-efficient qualified improvement property (E-QUIP) that is subject to an accelerated 10-year depreciation period.  The E-QUIP benefit would apply to purchases of modern and energy-efficient HVAC, lighting, and building envelope improvements, such as energy-saving roofs and windows. (Roundtable Weekly, May 10)

Separately, President Trump on Jan. 22 said a substantial middle-class tax cut – referred to as “Tax Cut 2.0” – will be released within 90 days, during an interview with Fox Business’ Maria Bartiromo at the World Economic Forum in Davis, Switzerland.  (Reuters, Jan. 22)

  • Treasury Secretary Steven Mnuchin told CNBC at the same conference, “The president has asked us to start working on what we call ‘tax 2.0,’ and that will be additional tax cuts. They’ll be tax cuts for the middle class, and we’ll also be looking at other incentives to stimulate economic growth.”  (CNBC, Jan. 23)
  • Larry Kudlow, director of the White House National Economic Council, told FOX Business’ Liz Claman on Jan. 17 that “The president directed me to produce what we’re calling ‘tax cuts 2.0.’  It will be published sometime during the campaign, has a message for future Trump economic growth policies, particular emphasis on the middle class in his second term.”
  • A legislative path toward passage of individual tax bills in an election year is very narrow, but separate tax proposals by Congress and the White House could culminate in an end-of year compromise package. 

Tax issues for 2020 will be a focus at next week’s Roundtable State of the Industry Meeting in Washington – both during the Jan. 28 business meeting and the Jan. 29 Tax Policy Advisory Committee (TPAC) meeting.  

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House Democrats Outline Climate Legislation, Address Buildings and Energy Efficiency

Posted on by Trey Jackson

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House Democrats on Jan. 8 released a legislative framework on climate policy that addresses buildings and energy efficiency among its sector-specific proposals. The goal for the House Energy and Commerce Committee’s Climate Leadership and Environmental Action for Our Nation’s (CLEAN) Future Act is to achieve overall net-zero greenhouse gas emissions (GHG) for the United States by 2050.

  • The legislative text of the draft CLEAN Future Act will be released by the end of this month while hearings and stakeholder meetings continue throughout the year. (Committee news release, Jan. 8).
  • The proposal addresses the efficiency of new and existing buildings, as well as the equipment and appliances that operate within them.  The bill proposes national energy savings targets from continued stringency of model building energy codes (frequently adopted into law at the state and local level), with a requirement of “zero-energy-ready buildings” by 2030.
  • The legislative framework also proposes requirements on utilities and other retail electricity suppliers to de-carbonize the U.S. electric grid.  Under the proposal, they must provide an increasing supply of clean electricity to consumers starting in 2022, rising to 100 percent clean energy by 2050.
  • The legislative framework will also direct the Federal Energy Regulatory Commission (FERC) to facilitate the integration of localized distributed energy, energy storage, and renewable energy resources into the electric grid.
  • While the CLEAN Future Act proposal is not expected to garner support from Republicans, measures that would “clean” the electric grid and direct FERC to modernize energy markets could theoretically impact emerging obligations on building owners to comply with certain local-level carbon reduction mandates (such as New York City’s Local Law 97.)  (See Roundtable Weekly, April 19, 2019)
  • Meanwhile, the House Select Committee on the Climate Crisis is expected to issue legislative policy recommendations by March 31, 2020.  (See Roundtable Weekly, October 25, 2019)
  • The Real Estate Roundtable submitted detailed energy and climate policy recommendations to the House Select Committee on November 21, 2019.  The comments offer a suite of priorities developed by The Roundtable’s Sustainability Policy Advisory Committee (SPAC), including:

* Improve the model building energy codes process by enacting the Portman-Shaheen Energy Savings and Industrial Competitiveness (ESIC) Act. (Roundtable Weekly, September 27, 2019)
 

* Enhance EPA’s voluntary ENERGY STAR incentive programs for both commercial buildings and tenants.

* Create meaningful accelerated depreciation periods to encourage investments in high performance equipment to retrofit existing commercial and multifamily buildings. (Roundtable Weekly, May 10, 2019)

  • House Speaker Nancy Pelosi (D-CA) has stated the House will act on a climate bill in 2020 (Bloomberg Environment, Dec. 6, 2019).  Majority Leader Steny Hoyer (D-MD) also told reporters this week that climate policy would be a “huge issue” this year. (E&E News, Jan. 9)
  • In the Senate, a different approach to energy policy has evolved over the past year.  The Senate Energy and Natural Resources (ENR) Committee passed 52 bills in 2019 on a largely bipartisan basis.  Several of these bills address commercial and residential real estate, including the Energy Savings and Industrial Competitiveness Act (ESIC) Act (Portman-Shaheen), long-supported by The Real Estate Roundtable.
  • The ESIC Act “is exactly the kind of smart, forward-looking policy that will help building owners respond to our modern, evolving economy” Roundtable President and CEO Jeffrey DeBoer stated in a Senate news release upon the bill’s introduction this past summer.  (Roundtable Weekly, July 19) (Video of DeBoer’s statement)

Energy and climate legislation will be a focus of discussion during The Roundtable’s upcoming January 28 State of the Industry Meeting in Washington.  The Roundtable’s Sustainability Policy Advisory Committee (SPAC) will also meet on January 29.

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Roundtable Submits Comments to House Climate Crisis Committee; House Democrats Unveil Green Energy Tax Draft

Posted on by Trey Jackson

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The Roundtable submitted energy and climate policy recommendations to the House Select Committee on the Climate Crisis on Thursday, while members of the House Ways and Means Committee unveiled a draft legislative package of more than 20 energy tax incentives – including incentives to promote commercial and residential building energy efficiency.  

The Roundtable’s climate letter submitted Nov. 21 responds to a request for information from the Select Committee. This panel has no authority to write legislation but is authorized to study climate change and issue legislative policy recommendations (expected by March 31, 2020).

In its study and review of climate policy recommendations, the Select Committee has held a series of hearings featuring various stakeholders – including one focused on “Cleaner, Stronger Buildings.”  (Roundtable Weekly, October 25, 2019) .

The Roundtable’s comments to the Select Committee highlighted the priorities advocated by its Sustainability Policy Advisory Committee (SPAC) to:       

  • Improve the model building energy codes process by enacting the Portman-Shaheen Energy Savings and Industrial Competitiveness (ESIC) Act. (Roundtable Weekly, September 27, 2019)
     
  • Enhance EPA’s voluntary ENERGY STAR incentive programs for both commercial buildings and tenants.
  • Improve the quality and reliability of the national data collected by the federal Commercial Building Energy Consumption Survey.
  • Create meaningful accelerated depreciation periods to encourage investments in high performance equipment to retrofit existing commercial and multifamily buildings. (Roundtable Weekly, May 10, 2019)
  • Foster public-private partnerships to finance safety and resiliency improvements to the electricity grid, the natural gas pipeline network, and other energy infrastructure assets.

Meanwhile, a discussion draft of the Growing Renewable Energy and Efficiency Now (GREEN) Act was released Nov. 19 by the chairman of the House Ways and Means Subcommittee on Select Revenue Measures – Rep. Mike Thompson (D-CA). 

The GREEN Act would extend and revise a number of expired tax incentives, including provisions aimed at encouraging taxpayers to improve the energy efficiency of homes and commercial buildings. Specifically, the discussion draft includes:

  • An updated and enhanced deduction for capital expenditures on energy-efficient commercial building property (section 179D)
  • An expanded tax credit for the developers of new, energy-efficient homes (section 45L)
  • A modified tax credit for energy-efficient improvements to existing homes (section 25C)

Under the bill, the revised tax incentives would be available through 2024. Following release of the draft legislation, House Ways and Means Committee Chairman Richie Neal (D-MA) stated, “The climate crisis requires bold action, and I’m pleased that we’re using the legislative tools at Ways and Means’ disposal to create green jobs, reduce carbon emissions, and help heal our planet.” We look forward to hearing from stakeholders to ensure this bill is effective in helping improve energy efficiency and eliminating carbon emissions.”

Prospects for passing the GREEN Act are unclear as it is a Democratic initiative that currently lacks Republican support. 

Additionally, The Roundtable and coalition partners continue to lay the research and data foundation for a new tax incentive that would provide accelerated depreciation for high performance, HVAC, lighting, windows, and other equipment to retrofit existing commercial and multifamily buildings, known as “E-QUIP.” (See Roundtable Weekly, May 10, 2019).  The coalition’s objective is for bipartisan introduction of an E-QUIP bill in early 2020.

The Roundtable’s Tax Policy Advisory Committee (TPAC) plans to analyze the proposed measures and respond to any eventual energy tax legislation that may be introduced in the New Year.

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Senate Committee Advances Portman-Shaheen Energy Efficiency Bill

Posted on by Trey Jackson

Senators Rob Portman (R-OH) and Jeanne Shaheen (D-NH)

The Senate Energy and Natural Resources (ENR) Committee passed a bill on Wednesday that emphasizes voluntary measures and incentives to drive energy efficiency improvements in U.S. buildings, manufacturing, and other economic sectors. 

  • The Energy Savings and Industrial Competitiveness (ESIC) Act (S. 2137) – sponsored by Senators Rob Portman (R-OH), above left, and Jeanne Shaheen (D-NH), right, and long endorsed by The Real Estate Roundtable – was advanced by the panel, along with several other energy bills.
  • Senator Lisa Murkwoski (R-AK), chairman of the ENR Committee, noted during the hearing, “For several Congresses now, [S. 2137] has been the Senate’s flagship effort on energy efficiency.  I’m hopeful that we are going to be able to see this into law.”
  • The ESIC Act passed the committee by a substantial margin (14-6), although provisions regarding voluntary building energy codes failed to garner a majority of Republican votes.  Murkowski added that the codes sections still needed more work to gain fuller bipartisan support.  She was optimistic that the “prevailing concerns” of industry stakeholders could be resolved.  (Committee video, Sept. 25)
  • The ESIC Act would improve current laws by adding “open government” and transparency provisions that do not currently apply to the development of building energy codes.  Real estate and other stakeholders would be provided a platform to comment on DOE code proposals affecting the industry. The measure also includes a new requirement that would compel the U.S. Department of Energy (DOE) to consider costs and small business impacts as part of the codes development process.  (Roundtable support letter for S. 2137)
  • S. 2137 would also direct the two federal agencies that separately collect critical nationwide data on building energy use – namely, the Energy Information Administration and the Environmental Protection Agency – to coordinate on their respective programs and take steps to ensure higher quality, more consistent data.
  • The ESIC Act “is exactly the kind of smart, forward-looking policy that will help building owners respond to our modern, evolving economy” Roundtable President and CEO Jeffrey DeBoer stated in a Senate news release upon the bill’s introduction this summer.  (Roundtable Weekly, July 19) (Video of DeBoer’s statement)

Further negotiations to refine the ESIC Act are anticipated in the coming weeks before it might advance to the full Senate for a vote.  Companion legislation is pending in the House (H.R. 3962), sponsored by Peter Welch (D-VT) and David McKinley (R-WV).

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Portman-Shaheen Energy Efficiency Bill Considered In Senate Hearing

Posted on by Trey Jackson

Senators Jeanne Shaheen (D-NH) and Rob Portman (R-OH)

The Senate’s Energy Subcommittee on Wednesday held a hearing that considered bipartisan legislation to help further advance energy efficiency in U.S. buildings without federal regulations – but through data-driven, voluntary measures.

  • The Senate panel assessed the Energy Savings and Industrial Competiveness (ESIC) Act (S. 2137) – co-sponsored by Senators Jeanne Shaheen (D-NH), above at left, and Rob Portman (R-OH), right,  –along with nine other energy policy bills at the subcommittee’s Wednesday hearing. The Roundtable is a strong supporter of the Portman-Shaheen bill.
  • Sen. Portman testified at the hearing, noting that the ESIC Act passed the Senate by an overwhelming margin in a prior session of Congress.  He remarked that the legislation contains no “heavy-handed mandates” and that its building code sections are “completely voluntary.”  He added that the measure would result in “greenhouse gas emissions reductions [that] are equivalent to taking about 11 million cars off the road.”  (Portman press release, Sept. 11.)
  • Sen. Shaheen’s testimony emphasized that “energy efficiency is the cheapest, fastest way to deal with our energy needs,” and that the bill would produce a policy trifecta to reduce emissions, protect the environment, and create jobs.  (Shaheen press release, Sept. 11.)
  • The Roundtable submitted a letter for the hearing’s record to reiterate its support for the bill.  Roundtable President and CEO Jeffrey D. DeBoer also spoke in support of the bill when it was announced at a press conference in July.  (Video of DeBoer’s statement on Portman-Shaheen)
  • The ESIC Act “is exactly the kind of smart, forward-looking policy that will help building owners respond to our modern, evolving economy” DeBoer stated in a Senate news release upon the bill’s introduction this summer.  “The needs of business tenants have changed dramatically since the turn of the century to power the data centers, IT, and communications systems upon which our workforce depends.  Building owners are meeting their tenants’ 24/7 energy demands while constructing and managing their assets more efficiently – and reducing their carbon footprints.” (Roundtable Weekly, July 19, 2019)  

Companion legislation to S. 2137 is pending in the House (H.R. 3962), sponsored by Peter Welch (D-VT) and David McKinley (R-WV).  As the next step in the Senate’s process, a mark-up of S. 2137 by the full Senate Energy Committee is expected this fall.

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