ACEEE Outlines 16 Policies to Increase Energy Efficiency Investment

The American Council for an Energy­ Efficient Economy (ACEEE), Washington, D.C., has released a report highlighting 16 policies that would remove market barriers to investment in energy efficiency. The report, “Overcoming Market Barriers and Using Market Forces to Advance Energy Efficiency,” provides Congress and state policymakers with a roadmap to address national energy consumption through policies that could save the country approximately $1 trillion in energy bills and 19 quads in energy consumption.

The report discusses targeted policies that leverage market mechanisms and address specific market failures to energy efficiency without requiring substantial spending or government mandates. For example, the development of a comprehensive building labeling and benchmarking program could save approximately 1.6 quads of energy and $60 billion between 2014­-30. Even more impressive are the benefits gained from adjusting corporate tax legislation to encourage the replacement of inefficient equipment and from removing regulatory barriers to combined heat and power projects. These policies could reduce national energy consumption by 7 quads and save the economy close to $300 billion.

“We want to show policymakers that there are a number of cost-­effective policies that could promote energy efficiency and kick start the economy at the same time. This report highlights a number of inventive approaches that we haven’t made much use of to date,” says Shruti Vaidyanathan, ACEEE senior research analyst and the report’s lead author. The report includes policy interventions targeted at residential and commercial buildings, the industrial and transportation sectors, as well as a number of policies with economy-­wide benefits. For each measure, the report provides a brief description of the policy, its legislative history, general estimates of associated costs and benefits, and recommendations about future policy design.