Congress Kumbaya on Energy Tested in Fight Over Efficiency

(Bloomberg) — The Republican Congress and President Barack Obama have accomplished something unusual: a deal on energy-efficiency legislation.

A scaled-down bill to boost efficient power use passed

Congress with barely any debate, and Obama signed it Thursday.

But the bipartisan comity may be short lived as opponents

take aim at a key piece of Obama’s climate plan. Makers of

freezers, furnaces and, even, ceiling fans are joining with

natural gas utilities and Republicans to try to stall

regulations that would make appliances more efficient.

“We cannot support an efficiency standard that imposes

higher costs, requires more energy and produces more

emissions,” John Somerhalder, president of AGL Resources Inc.,

a natural gas distributor, said Thursday at a House hearing

about a proposed furnace standard from the Energy Department.

The industry pushback shows how even the small steps in

Obama’s bid to curb greenhouse gases have become controversial.

Energy efficiency has long been the unassailable apple pie of

energy issues, as using less energy means lower fuel bills for

companies and consumers. And less natural gas or coal use means

lower greenhouse-gas emissions, so environmental groups support

efficiency as a low-cost climate solution.

‘Uniquely Positioned’

“Energy efficiency is uniquely positioned to draw

bipartisan support,” said Elizabeth Noll, energy efficiency

advocate for the Natural Resources Defense Council. There’s a

“vast bipartisan opportunity to do much more.”

Noll testified Thursday against efforts to roll back

efficiency standards, calling them counterproductive. Lobbyists

for companies such as Ingersoll-Rand Plc and Emerson Electric

Co. argue Obama’s rush for mandates in his climate plan is

creating standards they can’t meet. As a result, higher costs

will mean that more older appliances will stay in use — and

energy consumption could rise, they say.

The Senate in late March passed a version of legislation

from Senators Jeanne Shaheen, a New Hampshire Democrat, and Rob Portman, an Ohio Republican. That bill included provisions to

help induce building owners to adopt more efficient heating or

lighting, and reworked an Energy Department standard so water

heaters could be used as a system of storage.

That final bill included only a few of nearly 30 items in a

Shaheen-Portman measure from 2011, and lawmakers in both

chambers spent Thursday discussing which other parts could be

written into a comprehensive energy bill this year.

The House passed the bill this month.

Efficiency, Jobs

“The administration looks forward to continuing to work

with the Congress on bipartisan legislation to support energy

efficiency and boost U.S. competitiveness and job creation,”

Kathleen Hogan, the top Energy Department official for

efficiency, said at a Senate Energy and Natural Resources

Committee hearing.

Still, many pieces of the legislation would stop the

department from writing rules, and businesses took the

opportunity Thursday to weigh-in against the standards. Among

other steps, the measures would halt a proposal to boost furnace

efficiency to more than 90 percent, from 80 percent.

Chris Peel, chief operating officer for furnace maker Rheem

Manufacturing Co., told a House panel that most of the 80

percent furnaces are in the U.S. South, and replacing them with

more efficient units wouldn’t be cost effective.

The Energy Department’s “lack of true collaboration has

resulted in oversights, including errors involving economic

assumptions and technical issues,” Peel said.

The legislation would also phase out a requirement that all

new federal buildings be powered and heated by renewable

resources by 2030.

“We are deeply concerned that other of the provisions in

the draft bill actually will serve to impede or roll back

progress we are making,” said Kateri Callahan, president of the

Alliance to Save Energy, a group that represents companies that

help companies cut energy use, such as Siemens AG and Dow

Chemical Co.

To contact the reporter on this story:

Mark Drajem in Washington at

mdrajem@bloomberg.net

To contact the editors responsible for this story:

Jon Morgan at

jmorgan97@bloomberg.net

Romaine Bostick

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