Your Kitchen Is a Battleground in Obama Energy Efficiency Push

(Bloomberg) — For a taste of the energy legacy that
President Barack Obama is about to leave behind, check the
fridge.

No, literally. Since 2009, his administration has created
43 rules that will deliver the biggest energy savings of any
president in history, eliminating demand in 2030 equal to the
electricity produced by 96 power plants, based on a consumer
group’s estimates. And among the most effective is one that has
the family refrigerator running on less power than it takes to
light a 50-watt bulb.

A rule completed last month will shrink the energy used by
commercial rooftop air conditioners and furnaces, an effort the
U.S. government projects will save 1.7 trillion kilowatt-hours
of electricity over 30 years, more than any other change since
efficiency laws were enacted in 1975. Supporters say the changes
will cut power bills. Opponents warn appliance costs will rise
as manufacturers spend tens of millions redesigning products.

“It’s major progress for energy efficiency and it’s also a
major success in straightening out an important energy savings
program that had not previously delivered on what it was
supposed to do,” Andrew deLaski, executive director of the
Boston-based Appliance Standards Awareness Project, said in a
phone call.

Government Overreach

The Obama administration is guilty of overreach, say
opponents. A rule for dishwashers proposed in 2014 curbs water
consumption so much that the machines failed to remove food
caked on plates and utensils, according to the Association of
Home Appliance Manufacturers, a trade organization. The draft
standard, which may be adopted in August, was the result of the
U.S. Energy Department’s failure to consider input from
manufacturers and conduct proper product testing, the
Washington-based group said.

“The DOE is rushing to promulgate as many rules as they
possibly can and they are running into situations where they are
cutting corners in the analysis,” said Joseph McGuire, president
of the Washington-based group. “We are concerned that they’re
going too far and they’re going too fast, and it won’t be a good
deal for the consumer.”

Republicans in Congress have fought several energy plans
pushed by Obama. Representative Mike Pompeo, a Republican from
Kansas, said the premium consumers pay for many of the products
redesigned to meet the higher standards outweighs the energy
savings. He backs legislation to suspend action on the rules for
as long as 18 months.

Kathleen Hogan, the Energy Department’s deputy assistant
secretary for energy efficiency, defends the Obama effort as a
boon for consumers.

“One of the key commitments was to really get the appliance
standards program up to date,” Hogan said in a telephone
interview. “It’s a tremendous impact on saving people money and
reducing our need for energy.”

Few Spared

Few energy-consuming devices have been spared from the rule
changes. They cover everything from clothes washers and dryers
to ceiling fan light kits and beverage vending machines, with
the president pledging to review 17 more standards for possible
revision before the end of his term. The Energy Department has
estimated that the reductions will save consumers more than $520
billion through 2030 in electricity costs.

Those savings come at the expense of power company
earnings. Retail electricity sales have been flat since 2007
after gaining most every year from 1949, according to Energy
Information Administration data. The Standard & Poor’s 500
Utilities Index had the third-worst stock performance of any
industry group last year, with shares tumbling 8.4 percent.  

“In spite of the fact that the economy is growing at its
fastest rate since 2005, we’re still seeing load growth
stagnating in most every market,” said Shahid Malik, president
of energy resources and trade at Newark, New Jersey-based
utility Public Service Enterprise Group Inc.

President’s Leadership

Obama’s push for efficiency was part of his emergence as a
global leader in the drive to cut greenhouse gases, with the
president reaffirming his pledge to curtail carbon emissions
through energy efficiency in a pact with China in September.

All the standards updated during Obama’s presidency may cut
3 billion metric tons of carbon dioxide by 2030, equal to about
half the carbon pollution from the entire U.S. energy sector in
a year, according to the Energy Department.

In 2016, energy reductions may reach about 130 billion
kilowatt-hours and save consumers about $14 billion, according
to deLaski of Appliance Standards Awareness Project.

“When you can advance a policy that saves people money,
promotes innovation, saves a bunch of energy and yields
environmental emission reductions all at the same time, it’s a
no-brainer,” he said.

Wholesale power in the benchmark hub for the largest U.S.
grid extending from Washington to Chicago fell 76 cents, or 3.1
percent, to average $24.11 a megawatt-hour for the hour ended at
4 p.m. Thursday from the same time a day earlier, grid data
compiled by Bloomberg showed.

To contact the reporter on this story:
Jonathan N. Crawford in New York at jcrawford47@bloomberg.net

To contact the editors responsible for this story:
Lynn Doan at ldoan6@bloomberg.net
Stephen Cunningham, Richard Stubbe

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