FACT SHEET: 21ST CENTURY CONSERVATION

---------------------- Forwarded by Mary Schoen/NA/Enron on 05/15/2001 01:14
PM ---------------------------

Laitner.Skip@epamail.epa.gov on 05/15/2001 10:45:15 AM
To: Laitner.Skip@epamail.epa.gov
cc:

Subject: FACT SHEET: 21ST CENTURY CONSERVATION

21st Century Energy Conservation:
"Pushing conservation forward will require investment in new energy
technology. And that will be a part of my Administration?s energy plan."
President George W. Bush, May 12, 2001

Next week the National Energy Policy Development Group (NEPD), chaired by
Vice-President Cheney, will make its policy recommendations to the
President. Provided below are a few of the NEPD's recommendations to
promote 21st Century energy conservation.

Expand Combined Heat and Power Projects:
Because of their large needs for both heat and electricity, businesses find
Combined Heat and Power (CHP) systems particularly attractive. However,
replacing old, inefficient boilers with highly efficient CHP systems can
add a number of new regulatory requirements (such as air permits), without
offering the same depreciation incentives the tax code grants to power
plants.

Recommendations:
1. Direct the Secretary of Treasury to work with the Secretary of Energy
and Congress to encourage increased energy efficiency through combined heat
and power projects by shortening the tax depreciation life for CHP projects
to 7 years.

2. Direct the Administrator of the Environmental Protection Agency to
work with local and state governments to encourage the use of well-designed
CHP and other clean power generation at brownfields sites, consistent with
the local communities? interests. EPA will also work to clarify liability
issues if they are raised at a particular site.

3. Direct the Administrator of the Environmental Protection Agency to
promote combined heat and power through flexibility in environmental
permitting to the extent permitted by law.

Provide Incentives for Hybrid / Fuel Cell Vehicles
Hybrid vehicles use power electronics and battery storage to get more out
of every gallon of gasoline consumed, and provide the ability to double
vehicle mileage.

A recent National Energy Laboratory Report indicates that the fuel economy
of a typical automobile could be enhanced by 60 percent by increasing
engine and transmission efficiency and reducing vehicle mass by about 15
percent. Several promising efficiency technologies are being presented to
the U.S. market. Automobile manufacturers are developing and have already
introduced hybrid vehicles. Advanced lightweight materials offer up to 6
percent improvement in mileage for each 10 percent reduction in body
weight.

Recommendation: Direct the Secretary of the Treasury to work with Congress
to provide an individual, temporary, efficiency-based income tax credit be
available for purchase of new hybrid (gasoline/electric) or fuel cell
vehicles between 2002 and 2007.

Expand the Consumer Energy Efficiency Programs:
The Federal government not only ensures consumers have information on the
energy efficiency of major home appliances, it also promotes the most
energy efficient products in office buildings through the Energy Star
program, a joint program run by the Department of Energy (DOE) and the EPA.
Energy Star is awarded only to appliances that significantly exceed minimum
energy efficiency standards. The Energy Star program does not extend to all
products. Energy efficiency would be further promoted if the Energy Star
program were expanded to a broader range of products.

Recommendations:

1. Direct the Secretary of Energy to promote greater energy efficiency of
appliances and buildings. Specifically,

a. Expand the Energy Star program beyond office buildings to include
schools, retail buildings, health care facilities, and homes;

b. Extend the Energy Star labeling program to additional products,
appliances and services; and

c. Strengthen DOE public education programs relating to energy
efficiency.

2. Direct the Administrator of the EPA to develop and implement a strategy
to increase public awareness of the sizeable savings that energy efficiency
offers to homeowners. The typical homeowner can save about 30 percent
(about $400) a year on their home energy bill by using Energy Star labeled
products such as computers, air conditioners and other products.

************************************************************
John A. "Skip" Laitner
Senior Economist for Technology Policy
EPA Office of Atmospheric Programs

Mailing Address
1200 Pennsylvania Avenue NW, MS-6201J
Washington, DC 20460
Office Location and Delivery Address
501 3rd Street NW, 4th Floor,
Washington, DC 20001
Telephone
o: (202) 564-9833
f: (202) 565-2147
************************************************************