**Testimony of Dan W. Reicher**

**Director, Climate Change and Energy Initiatives**

**Google.org**

**Before the**

**Senate Finance Committee**

**February 27, 2007**

Mr. Chairman and members of the Committee, my name is Dan W. Reicher and
I am

pleased to testify today on federal policy measures that can enhance
investment in clean

energy, particularly energy efficiency. I recently joined Google where I
serve as Director

of Climate Change and Energy Initiatives for the company's new
philanthropic venture

called Google.org. Google.org has been capitalized with more than \$1
billion of Google

stock to make investments and advance policy in the areas of climate
change and energy,

global poverty and global health.

Prior to my position with Google, I was President and Co-Founder of New
Energy

Capital, a private equity firm funded by the California State Teachers
Retirement System

and Vantage Point Venture Partners to invest in clean energy projects.
New Energy

Capital has made equity investments and secured debt financing for
ethanol and biodiesel

projects, cogeneration facilities, and a biomass power plant. Prior to
this position, I was

Executive Vice President of Northern Power Systems, the nation's oldest
renewable

energy company. Northern Power has built almost one thousand energy
projects around

the world and also developed path-breaking energy technology.

From 1993 to 2001, I served in the Clinton Administration as Assistant
Secretary of

Energy for Energy Efficiency and Renewable Energy, Department of Energy
Chief of

Staff and Deputy Chief of Staff, and the Acting Assistant Secretary of
Energy for Policy.

Mr. Chairman, we have a broad array of options for addressing the
nation's energy

challenges, as other witnesses demonstrate in their testimony today. The
federal

government, through Congressional and Presidential leadership, has a
powerful role to

play in moving these energy solutions to market. I am honored to share
with you my

views as an investor, former policymaker and most importantly, as a
professional

dedicated to ensuring our success in meeting today's energy-related
challenges: climate

change, national security, economic competitiveness and poverty
alleviation.

There are several steps the federal government must take to drive
massive private sector

investment -- measured in the trillions of dollars -- that will be
required to move the nation

toward a more sustainable energy future:

• First, the federal government must put a price on greenhouse gas
emissions in

order to internalize the costs of climate change and move energy
investments

toward lower carbon and more efficient technologies.

• Second, we must remove barriers to cleaner and more efficient
technologies and

establish incentives and standards to move these technologies to market.

• Third, we must significantly increase public funding of research,
development and

deployment of advanced energy technologies.

• And fourth, the federal government must support fluid, transparent
markets to

monetize the environmental benefits that these technologies provide. The
market

needs clear definitions of and ownership rules for renewable energy
certificates,

carbon offsets, white tags, and other environmental assets created by
regulation at

the federal and state level.

**Energy Efficiency -- Our Cheapest, Cleanest and Fastest Energy
Option**

Today I have been asked to focus my attention on how to spur investment
in what many

see as our fastest, cheapest and cleanest opportunity to address our
energy challenges --

energy efficiency. Duke Energy CEO James Rogers has termed energy
efficiency our

"fifth fuel" and energy efficiency guru Amory Lovins measures it in
"Negawatts". The

federal government has the power to leverage vastly more private sector
investment in

energy efficiency thereby dramatically increasing U.S. competitiveness,
improving our

quality of life, and addressing climate change.

Energy efficiency is the real low-hanging fruit in the US and global
economy. From cars

and homes to factories and offices, we know how to cost effectively
deliver vast

quantities of energy savings TODAY. And the exciting fact is that this
low hanging fruit

grows back. The incandescent light bulb we replace today with a compact
fluorescent, we

will be able to replace again with an even more efficient bulb in the
future. Similarly,

we can trade our gas-guzzling SUV today for a more efficient
full-featured hybrid gaselectric

model. And down the road we will replace the hybrid with an advanced
model

that runs on ethanol or biodiesel and plugs into the electric grid.

We have made an important transition in this country away from a focus
on "energy

conservation" and toward the more recent concept of "energy efficiency"
(or "energy

productivity"). In the era of energy conservation in the 1970's and
1980's we were

asked to "do less with less" -- to lower the thermostat, turn off the
lights, don a sweater

and leave the car in the garage. Energy efficiency takes a different
approach, offering the

opportunity to "do more with less". As McKinsey and Company states in a
2006 report,

"By looking merely in terms of shrinking demand, we are in danger of
denying

opportunities to consumers -- particularly those in developing economies
who are an

increasingly dominant force in global energy-demand growth. Rather than
seeking to

reduce end-user demand -- and thus the level of comfort, convenience and
economic

welfare demanded by consumers -- we should focus on using the benefits
of energy most

productively."

The main finding of the 2006 McKinsey report is that while energy demand
will continue

to grow, "there are sufficiently economically viable opportunities for
energy-productivity

improvements that could keep global energy-demand growth at less than 1
percent per

annum -- or less than half of the 2.2% average growth to 2020
anticipated in our basecase

scenario." According to McKinsey, "Energy-productivity improvements can
come

either from reducing the energy inputs required to produce the same
level of energy

services, or from increasing the quality or quantity of economic
outputs." The report

concludes that globally the largest untapped potential for
cost-effective energy

productivity gains (\>10% Internal Rate of Return) lies in the
residential sector (e.g. better

building shells and more efficient water heating and lighting), power
generation sector

(e.g. more efficient power plants and electricity distribution) and
industrial sector (e.g.

less energy-intensive oil refineries and steel plants).

However, McKinsey concludes that capturing this vast potential will
require a significant

policy push. McKinsey says, "market-distorting subsidies, information
gaps, agency

issues, and other market inefficiencies all work against energy
productivity.

Furthermore, the small share of energy costs for most businesses and
consumers reduces

end-use response to energy-price signals. Therefore shifting global
energy demand from

its current rapid growth trajectory will require the removal of existing
policy distortions;

improving the transparency in the usage of energy; and the selective
deployment of

energy policies, such as standards."

As we consider this policy dimension we also need to consider how to
harness an

important and heartening new trend -- the unprecedented flow of private
capital toward

clean energy. Who would have thought even a few years ago that Goldman
Sachs,

Citigroup, John Hancock Insurance, General Electric, Morgan Stanley, the
Carlyle

Group, Kleiner Perkins and other titans of Wall Street and Silicon
Valley would be major

investors in clean energy technologies and projects? In fact, in just
the last year we have

seen literally billions of dollars invested in companies commercializing
advanced energy

technologies and tens of billions of dollars invested in building clean
energy projects.

"CleanTech" has recently become the hottest new area of venture capital
investing, while

clean energy projects have become an important new element of the
project finance

world.

At the same time, most of this increasing investment in technologies and
projects has

been on the supply side involving key technologies like solar, wind, and
biofuels.

However, little investment has found its way to commercializing or
deploying energy

efficiency technologies despite their cost-effectiveness and
reliability. Explanations for

this range from the simple to the arcane: for example, the less "sexy"
nature of efficiency

technologies, the often more disaggregated nature of their deployment,
the greater

challenge of financing "savings" measured in Negawatts than production
measured in

Megawatts, and weaker policy support.

Regarding the last point, aggressive federal policy can make a major
difference in the

development and deployment of energy technology. In the case of ethanol,
for example,

Congress has enacted both a significant federal tax credit and major
federal mandate

which have helped stimulate massive new investment in production plants
as well as new

technologies. Energy efficiency has simply not enjoyed this kind of
policy support and

the investment that it generates. Below I address how federal policy can
enhance private

sector investment in energy efficiency, as it now supports critical
investment in

renewable energy.

I should emphasize that by moderating demand growth through energy
efficiency, and at

the same time increasing clean generation using renewable sources, we
can slow and

begin to decrease carbon emissions while we work to adopt and implement
a

comprehensive approach to addressing climate change. Congress should pay
careful

attention to this complementary strategy involving both energy
efficiency and renewable

energy as an important down payment on reducing carbon emissions, while
it deliberates

the more complex issues entailed in enacting and implementing an
economy-wide

climate policy.

**Federal Policies to Increase Investment in Energy Efficiency**

There are an array of federal policy instruments that can enhance
investment in energy

efficiency including standards, tax credits, and RD&D funding.

• *Automobile Fuel Efficiency*

The single most effective energy efficiency policy ever adopted by the
federal

government is the Corporate Average Fuel Economy requirement (CAFE).
Since its

adoption in 1975, CAFE has cut U.S. oil consumption by over 1 billion
barrels each year.

Even with this progress, passenger vehicles today consume approximately
40% of the

petroleum in the United States -- with the transportation sector
projected to generate 89

percent of the growth in petroleum demand through 2020. And the federal
government

has not significantly strengthened the CAFÉ standards in years, further
diminishing their

effectiveness. Raising fuel economy performance to 40 mpg over the next
10 years --

through revision of the CAFE standards --could alone cut passenger
vehicle oil demand

by about one-third or 4 million barrels per day by 2020 \-- about twice
current daily

imports from Saudi Arabia and Kuwait.

Existing technologies -- hybrid electric automobiles, drive train
improvements, lighter

weight materials -- can today get us to roughly double the mileage of
our current

passenger fleet. Perhaps the most exciting technological development has
been the recent

emergence of plug-in hybrids -- a technology that will enable us to
exceed any fuel

economy proposals under consideration at this time. Plug-in hybrids have
a more

powerful battery than traditional hybrids and are designed to be
connected to the electric

grid for recharging. This allows the vehicle to cut gasoline use and, if
charged at night,

use lower cost and cleaner off-peak electricity. These cars can also
benefit electric

utilities when plugged in during the day by sending power back to the
grid to meet peak

power needs, thereby supplanting some of the most costly and often most
polluting power

generation. According to analysts, this benefit to utilities could be
worth thousands of

dollars per year per car, a value that could rapidly exceed the
incremental cost of the

vehicle's more powerful battery if shared with consumers.

By increasing vehicle use of electricity over liquid fuels, we should
have an easier time

improving the environmental profile of our automotive fleet. This is
because lowering

emissions from hundreds of power plants will likely be a more rapid and
straight forward

task than influencing the fuel purchases and driving behavior of
millions of individuals.

Even charged with electricity from coal dominated parts of our electric
grid, a plug-in

hybrid is generally cleaner than a gasoline powered car. In addition,
plug-in hybrid

vehicles enabled to run on biofuels can reduce greenhouse gasoline
emissions up to 80%,

and oil consumption by as much as two thirds.

The multiple benefits provided by plug-in hybrids call for significant
federal actions to

move this technology to market as quickly as possible. In addition to
controls on

greenhouse gas emissions and increased CAFE standards, the federal
government can

partner with the private sector to address outstanding technological
barriers such as

battery cost and performance. Even more importantly, the federal
government should

support deployment of plug-in hybrid vehicles through tax incentives and
federal fleet

procurement.

• *Energy Efficiency Resource Standard (EERS)*

Just as the Senate has voted in favor of a Renewable Portfolio Standard,
it should

strongly consider a similar - and highly complementary - mechanism
called the Energy

Efficiency Resource Standard (EERS). The EERS sets efficiency resource
targets for

electricity and gas suppliers over the period of 2008-2020. It builds on
policies now in

place in eight states -- California, Texas, Vermont, Connecticut,
Nevada, Hawaii,

Pennsylvania, and Colorado -- designed to cut the growth in electricity
demand through

energy efficiency. The Texas and Vermont policies have been implemented
for several

years and have been very successful. Texas utilities, for example, are
required to meet

10% of their load growth needs through efficiency programs. Utilities
are easily

exceeding this target, resulting in current consideration of raising the
standard to as high

as 50% of load growth. Vermont created an energy efficiency utility that
has helped the

state in recent years meet more than two thirds of load growth
(typically 1.5 to 2% per

year) through energy efficiency and the state is on a path to avoid all
load growth in the

near future.

Under the proposed federal EERS, suppliers are required to obtain energy
savings from

customer facilities and distributed generation installations in amounts
equal to at least

0.75% of base year energy sales for electricity, and 0.50% for natural
gas. This

requirement is phased in over three years and cumulates during the
compliance period.

The requirement applies to retail suppliers, be they local distribution
utilities or

competitive energy suppliers, who sell annually at least 800,000
megawatt hours of

electricity or 1 billion cubic feet of natural gas.

Eligible energy savings measures include efficiency improvements to new
or existing

customer facilities, distributed energy technologies including fuel
cells and combined

heat and power systems, and recycled energy from a variety of defined
commercial and

industrial energy applications. Savings are determined using evaluation
protocols that

can be defined by the Department of Energy (DOE), with state protocols
available that

the Department can build upon.

Suppliers may obtain and trade credits for energy savings under
procedures to be defined

by DOE. This will enable suppliers with energy savings beyond the
requirements of the

standard to sell them to suppliers unable to obtain sufficient savings
from their customers

within a given compliance period.

The EERS is a compelling complement to a Renewable Portfolio Standard
(RPS), which

the Senate has passed before and will consider again this year. EERS
moderates demand

growth so that RPS targets can actually reduce fossil fuel consumption.
The RPS

provision the Senate supported in 2005 calls for 10% of US electricity
generation to be

generated from non-hydro renewable energy sources in 2020. However, the
Energy

Information Administration forecasts electricity demand to grow more
than 22% by 2020.

Unless we bring down demand growth, the RPS will not likely reduce
fossil energy

consumption or carbon emissions. The EERS proposal, as analyzed by the
American

Council for an Energy Efficient Economy would reduce 2020 peak
electricity demand by

about 10% or about 133,000 MW \-- equivalent to almost 450 power plants
at 300 MW

each. This would bring demand growth down to a level where a 10% RPS
could meet all

new electricity generation needs. ACEEE also estimates that by 2020,
this provision will

reduce natural gas needs by about 2 billion cubic feet, reduce CO2
emissions by more

than 340 million metric tonnes, and result in cumulative net savings to
electricity and

natural gas consumers of about \$29 billion. Moving to a 15% or 20% RPS
level, as

proposed in recent bills, would further accelerate the move to a less
carbon-intensive

electricity system.

These two policies, EERS and RPS, figure prominently in a forthcoming
report, prepared

by the American Council for an Energy Efficient Economy and the American
Council on

Renewable Energy and supported by the Rockefeller Brothers Fund, that
explores the

synergies between energy efficiency and renewable energy. These two
energy sources

offer a highly complementary approach to managing the challenges of the
U.S. power

sector in the coming decades.

**By moderating demand growth through an EERS and increasing clean
generation**

**through an RPS, we can slow and begin to decrease carbon emissions in
the utility**

**sector, while we work to adopt and implement a comprehensive
cap-and-trade**

**system. Congress should give strong consideration to this EERS-RPS
approach as a**

**straightforward down payment on reducing carbon emissions, while it
deliberates**

**the more complex issues entailed in enacting and implementing an
economy-wide**

**climate policy.**

• *Utility Revenue Decoupling*

The recent National Action Plan for Energy Efficiency

(http://www.epa.gov/cleanrgy/actionplan/eeactionplan.htm) provides joint

recommendations from federal agencies, states, the utility industry and
environmental

groups regarding energy efficiency. One area of focus in the report is
the concept of

\"revenue decoupling\". This approach, first instituted in California,
decouples sales from

profits, so that electric and gas utilities do not have a disincentive
to promote energy

efficiency. The current \"throughput\" incentive (the more electricity
or gas a utility sells,

the more it earns) is a significant impediment to energy efficiency. As
state utility

commissions work to advance decoupling, Congress and the Administration
(especially

FERC and DOE) should consider further incentives to promote energy
efficiency. One

important federal role would be to promote \"best practices\" and
provide technical

assistance to interested parties to facilitate energy efficiency.

• *Tax Credits for Efficient Buildings*

Thanks in part to the efforts of this Committee, the Energy Policy Act
of 2005 provided

important tax incentives for efficient buildings and equipment, in
addition to significant

support for renewable energy and other advanced energy technologies.
Legislation

introduced last year by Senators Snowe and Feinstein, called the EXTEND
Act, extends

and expands these building-related incentives to enhance investment in
energy efficiency.

The principal purpose of the bill is to extend the temporary 2005 EPACT
tax incentives

for a sufficient length of time so that the business community can
invest in complying

with the significant requirements for the incentives.

Commercial buildings and large residential subdivisions have lead times
for planning and

construction of 2-4 years, so many businesses will refrain from making
investments to

qualify for tax incentives if the duration of the incentive is only 2
years. The EXTEND

Act provides four years of assured incentives for most situations, and
some additional

time for projects with particularly long lead times, such as commercial
buildings.

The EXTEND Act also makes an important modification to the 2005 EPACT
incentives

so as to phase out incentives based on the cost incurred in saving or
producing energy and

replace them with incentives based on the actual performance (measured
by on-site

ratings for whole buildings and factory ratings for products like air
conditioners,

furnaces, and water heaters.) The legislation provides a new home
retrofit tax incentive

for ambitious levels of energy savings that are verified by a
third-party rater.

A goal of this bill is to provide a transition from the EPACT 2005
retrofit incentives,

which are based partially on cost and partially on performance, to a new
system that

provides greater financial incentives based on performance. These larger
incentives

should not cost the Treasury more because the ambitious requirement of a
minimum 20

percent savings will effectively eliminate free ridership, which is the
problem that caused

the current EPACT incentives to be scored as high as they were.

The Snowe-Feinstein bill also extends the applicability of the EPACT
incentives so that

the entire commercial and residential building sectors are covered. The
current EPACT

incentives for new homes are limited to owner-occupied properties or
high rise buildings.

The Snowe-Feinstein bill extends these provisions to rental property and
offers incentives

whether the owner is an individual taxpayer or a corporation. This
extension does not

increase costs significantly, but it does provide greater fairness and
clearer market signals

to builders and equipment manufacturers.

• *Public- Private Partnership on Low Income Weatherization*

Across the nation, poor families often increasingly face the choice
between heating and

eating as prices for natural gas, heating oil, propane and electricity
have skyrocketed and

millions of poor Americans have found themselves spending more than
one-quarter of

their income to run their furnaces, air conditioners and keep the lights
on. In a survey of

low income families -- before the energy price spike in 2005-2006 \--
32% went without

medical or dental care, 24% failed to make a rent or mortgage payment,
and 22% went

without food for at least one day due to energy bills.

Congress continues to debate the traditional fix for this problem:
additional funding for

the Low Income Home Energy Assistance Program (LIHEAP). But we need to
recognize

the serious limitations of the roughly \$2 billion we spend annually on
federal fuel

assistance, particularly as Congress considers the Fiscal Year 2008
budget. LIHEAP is

essentially a one-shot buy-down of energy bills that covers only a
modest percentage of

eligible families -- an absolutely critical but in no way sufficient
answer to the energy

woes of the poor. Together, federal and state fuel assistance funds
provided less than

10% of the total energy costs for low income households in 2006.

The longer-term answer for the poor is home weatherization. By upgrading
a home's

furnace, sealing leaky ducts, fixing windows, and adding insulation we
can cut energy

bills by 20-40% \-- for years -- and the substantial savings accrue with
summer air

conditioning as well as winter heating. And by adding energy efficient
appliances and

lighting the savings are even greater. Replacing a 1970's vintage
refrigerator with a new

energy efficient model will cut an average home electricity bill by
10-15%. Weatherizing

low-income homes also improves comfort, reduces illness, and creates
jobs.

Unfortunately, we have taken a penny-wise pound-foolish approach to
low-income

weatherization with less than \$245 million in the 2006 Department of
Energy

weatherization budget, enough for only about 100,000 U.S. homes. And
while the nation

has weatherized about 5.5 million low-income homes since 1976, more than
28 million

remain eligible. While the Bush Administration has supported increases
in the

weatherization program in the past, the 2008 budget proposes only \$144
million, a cut of

about \$100 million that will have serious consequences for the nation's
poor.

Instead of cutting weatherization funding, the President and Congress
should make a

national commitment to weatherize at least one million low-income homes
each year for

the next decade. This program would go a long way toward helping the
most vulnerable

among us---something the nation pledged it would do after Hurricane
Katrina

emphasized the extent of American poverty. The price tag for
retrofitting 10 million lowincome

homes is relatively modest -- about \$2 billion annually when fully
implemented.

With such a commitment there would be other benefits that directly
address our current

energy and environmental challenges. Stresses we are seeing today on the
U.S. energy

system -- from blackouts to natural gas shortages \--will be dampened
with every

additional home weatherized. For example, weatherizing all the
low-income homes that

heat with natural gas would cut residential U.S. use of this
clean-burning fuel by about

5%, dampen its price volatility and reduce the call on federal fuel
assistance funds.

The advanced technologies pioneered in the federal low income
weatherization program

can also be readily applied to the U.S. housing stock at large, with
even greater energy

savings. One technology developed in the Department of Energy
weatherization program

uses a pressurization device and a simple infrared sensor to pinpoint
leaks down to the

size of a nail hole for about \$100 per home. With this information
insulation can be

installed in the right places with the least amount of waste.

As we cut energy demand we also cut air pollution. An Ohio study showed
that

weatherizing 12,000 homes not only cut the average consumer bill by
several hundred

dollars each year but overall avoided annual emissions of 100,000 pounds
of sulfur

dioxide as well as 24,000 tons of carbon dioxide -- the primary global
warming gas. As

Congress and the Administration consider changes to the Clean Air Act
and how to

address climate change we ought to create an effective way to encourage
power plant

owners to invest in weatherization and other "downstream" pollution
reduction

opportunities. This could leverage substantial additional private sector
capital for lowincome

weatherization and avoid the need for new power plants.

More broadly, we believe there are a variety of potential mechanisms to
spur private

sector investment in weatherization and we are currently exploring these
within the

financial community. One approach would:

• aggregate thousands of homes eligible for weatherization in a locality

• establish a base-line of energy use as well as associated greenhouse
gas and other

emissions across the portfolio of homes

• install advanced metering to monitor post-investment savings as well
as provide

utility load control

• secure federal and state funding as well as carbon off-set, pollution
credits, and

utility capacity payments

• leverage private sector investment in the aggregated portfolio through
a "shared

savings" approach or other financial mechanism

• benchmark the investment to enhance replication

There may also be an opportunity to provide an extra incentive or credit
in the Energy

Efficiency Resource Standard for investment by an electricity or gas
supplier in low

income home weatherization.

• *State Building Codes*

California has demonstrated the significant efficiency gains that can be
achieved through

state building codes that are well designed and implemented. Title 24 of
the California

Code has been the national model, helping the state avoid thousands of
Megawatts of

new generation capacity. Despite this impressive track record in
California, many states

have inadequate state building codes or none at all. Section 128 of the
2005 Energy

Policy Act authorizes \$25 million per year for FY2006-FY2010 (\$125
million total) for

states that have adopted, and are implementing, both residential and
commercial building

energy-efficiency codes that meet or exceed specific standards. For
states where there is

no statewide code, the money will be allocated to local governments that
have

implemented codes that meet the above standards. Unfortunately, the
funding authorized

in the 2005 EPACT for state building codes was never appropriated by
Congress and

therefore this important incentive for adoption of state building codes
has not been

implemented. Congress should appropriate the funds authorized in the
2005 EPACT.

• *Appliance Efficiency Standards*

One of America\'s least-heralded energy success stories involves federal

appliance efficiency standards. In the last 15 years, Congress and the
Department of

Energy have set new standards for dozens of products. Refrigerators sold
since 2001 in

the U.S. use just one-third the energy of comparable models sold in
1980. Home air

conditioners are nearly twice as efficient as those sold at the start of
the Reagan

administration.

Standards in place today will save American families and businesses
about \$200 billion

cumulatively by 2020, cutting electricity demand and carbon emissions
substantially. The

16 products in the Energy Policy Act of 2005 will save another \$50
billion, and will cut

carbon emissions by another 16 million tons in 2020.

Unfortunately, DOE has issued only two new appliance efficiency
standards during the

tenure of the current Administration. In the settlement of recent
litigation brought by

states and environmental groups, DOE agreed to issue 22 overdue
standards in the next

four years. Congress should ensure that DOE has the funds to conduct the
necessary

analysis, that the Department stays on schedule, and that it adopts
rigorous final

standards.

Section 124 of EPACT 2005 authorizes a new program to encourage
deployment of high

efficiency appliances, based on a successful New York program. The
program, however,

has not been funded. Congress should appropriate the authorized funds.

• *Federal RD&D Funding*

Research and development is essential to supplying the \"technology
pipeline\" we need to

provide this century\'s clean energy solutions. Unfortunately, R&D on
energy efficiency,

as well as other energy technologies, has been falling. The Bush
Administration\'s 2008

request for efficiency R&D is 18% below the FY 2006 levels, and more
than a third

lower than the 2002 budget. Total federal spending remains far below the
peak of

investment that occurred in the 1970s. And the private sector has not
yet picked up the

slack; efficiency funding in the electricity and gas industries has
fallen even faster than

federal investment. Some states, like California, Iowa, Wisconsin, and
New York, are

trying to pick up the slack, but their work is no substitute for federal
support. Congress

should ensure that adequate funds are appropriated in Fiscal Year 2008
and beyond to

advance critical clean energy R&D.

Beyond R&D there are a number of deployment-oriented programs that
Congress

authorized in EPACT 2005 but has either not funded or has provided
insufficient funds.

These cut across many areas including buildings, appliances, energy
codes, state energy

programs, low income programs, public information and education, public
buildings, and

pilot projects. Also, the loan guarantee program authorized by Congress
in EPACT 2005,

which could be a significant help in energy efficiency projects, has yet
to back any loans.

All of these deployment programs help ensure that the technologies
developed in the

national laboratories or nurtured by federal R&D funding, actually get
to the marketplace.

**Conclusion**

Mr. Chairman and members of the Committee I am confident that a
concerted policy

push by the federal government, as outlined above, can greatly increase
private sector

investment in energy efficiency, resulting in many benefits for the
nation. I look forward

to working with the Senate to develop, enact and implement legislation
that will stimulate

this much needed investment.