Energy Bills Moving Quickly Through Congress Will Impact Electrical Industry

June 26, 2009
Major energy legislation under consideration in both houses of Congress contain a host of provisions that could spur additional demand for electrical products

Major energy legislation under consideration in both houses of Congress contain a host of provisions that could spur additional demand for electrical products. The House bill was expected to go to the full House for a vote this Friday or Saturday. The Senate bill could go up for a vote as early as September.

In the House of Representatives, the American Clean Energy and Security Act of 2009, aka H.R. 2454, was reported out by the Committee on Energy and Commerce on June 5, cleared by several other committees and placed on the agenda for a vote by the full House.

In the Senate, the Energy and Natural Resources Committee completed work last week on the American Clean Energy Leadership Act, which will now proceed to a vote by the full Senate at a time yet to be determined, probably in October, but possibly earlier, said Kyle Pitsor, vice president of government relations for the National Electrical Manufacturers Association (NEMA), Rosslyn, Va.

NEMA and the American Lighting Association, Dallas, have been active in helping to shape the legislation, addressing Congress in hearings and working in coalitions with environmental organizations, energy-efficiency advocates, utilities and building owners, among others, to inform senators and representatives about the needs and opportunities for reducing energy consumption and enhancing energy security.

NEMA’s top priorities regarding these bills include provisions to expand the nation’s electric power transmission systems, to establish nationwide renewable energy portfolio standards, to promote the use of energy efficiency building codes and to promote energy-efficient upgrades among manufacturing companies. The goal is to help move the nation toward greater efficiency without disrupting the market, said Pitsor.

“Our members are leaders in energy solutions, and have been proactive in identifying where there are products and technologies that can be obsoleted in favor of more energy-efficient solutions,” Pitsor said. “The important part is that we need to do that in a timeframe where there’s a proper phasing so it doesn’t cause significant market disruption, and that there’s no loss of utility for the end user as a result of the transition.”

Among the provisions that will directly affect the electrical products industry, the Senate bill includes new federal energy efficiency standards for portable light fixtures and certain incandescent reflector lamps that had been exempted from previous legislation.

Both bills include sweeping changes in the nation’s production and use of electricity. They would create a nationwide standard for renewable sources of electric power. The Senate bill mandates that sellers of electricity obtain 15 percent of their electricity from renewable sources by 2020, whereas in the House bill it would rise to 17 percent by that year.

The bills would require the Federal Energy Regulatory Commission (FERC) to develop an interconnection-wide transmission plan and give it the power to step in to resolve issues over the siting of transmission infrastructure that have hindered local and state utility commissions seeking to develop systems for carrying power from wind, solar and other renewable generation facilities to the population centers that are the primary users.

The legislation also directs the Department of Energy (DOE) to work with building code organizations to develop commercial and residential model building codes with requirements for efficiency improvements rising to 50 percent after 2016.

The Senate bill includes establishing financing mechanisms to encourage small and medium-sized manufacturers to upgrade the efficiency of their facilities and production processes through adoption of more efficiency technologies. This includes a direct rebate for replacing old electric motors with NEMA premium-rated motors and studies on the benefits of variable speed drives.

The differences between the bills will have to be worked out once they are passed by their respective chambers. H.R. 2454 includes climate change provisions not found in the Senate version, including carbon sequestration and the creation of infrastructure for electric vehicles. In the Senate, climate change laws are being considered in a separate bill because of the Senate’s requirement of 60 votes to close debate on legislation. The question of whether or not climate change provisions are included in the final bill may determine whether climate change legislation will reach President Barack Obama’s desk this year, said Pitsor of NEMA.