# Presentation: 189620

## When Were You First Aware of Non-Attainment?

- 1983-moved from Houston to Austin for smaller, cleaner city
- 1990-Houston classified “severe” non-attainment
- 1994-Texas cancelled Inspection & Maintenance contract; reduces enforcement
- 1996-DFW reclassified “serious” non-attainment; demonstration of attainment due by 1999
- 1997-Texas settles I&M contract cancellation suit for $140 million
- 1998-as new Executive Director of TBEI, I inherited a Special Project for promoting the MEC

## Whose Idea Was It To Include Energy Code As A Solution?

- The opportunity grew out of a history of individual commitments
- Special thanks to:
- Dr. Jerry Matthews, former director of TBEI and TECC; currently Executive Director of Texas Council on Environmental Technology
- Walt Patterson, retired MEC advocate, UT Arlington
- Jim Sargent, Waxahachie builder
- Tom “Smitty” Smith, Director of Texas Office of Public Citizen
- Political leadership: Sen. Buster Brown, Reps. Steve Wolens and Warren Chisum. Judge Ron Harris

## How Did You Start?

- ’98- inherited MEC promotion; discussed 98 IECC w/ Smitty and EDF – SHGC
- ’99- SB 7- elec. dereg. (energy efficiency, renewables, removal of grandfathering)
- ’99- SIP development –DFW and Houston; public participation (Blue Skies); HBA
- ’99- SP brochure for community leaders
- ’00-NCTCOG code review process
- ’01- SB 5 negotiation process

## SB 5, 77th Texas Legislature

- Amends Subtitle C, Title 5, Health & Safety Code, recognizing clean air as a critical issue for health of all Texans
- Depends upon a broad base of participation in addressing air quality issues
- Provides policy initiatives to encourage market transformations and technology development
- Modified the State Implementation Plan

##  Overview of SB 5

- Establishes **Texas Emissions Reduction Plan**, including
- a diesel emissions reduction incentive program,
- a motor vehicle purchase or lease incentive program,
- a new technology research and development program,
- an energy efficiency grant program, and
- building energy performance standards.
*Footnote: funding woes*

**Notes:**
Texas has four federal Clean Air Act non-attainment and three near-non-attainment areas, comprising 37 counties.  These areas represent 70 percent of the state's population, 76 percent of aggregate employment, 82 percent of personal income, and 83 percent of gross state product.  Because
of Texas' integrated economy, all parts of the state have a stake in bringing these areas into compliance. 

The Texas Natural Resource Conservation Commission (TNRCC) has submitted a state implementation plan to regulate emissions in non-attainment areas.  However, there are significant areas of potential emissions reductions TNRCC cannot regulate but which may be realized through an incentive program.   S.B. 5 establishes the Texas emissions reduction plan to reduce emissions in the state. 

## Local Amendments

- Local amendments allowed.
- In non-attainment areas and affected counties, may not result in less stringent energy efficiency requirements.
- Texas A&M Energy Systems Laboratory (ESL) to review local amendments and submit annual report of savings impacts to TNRCC.

## A building certified through an energy efficiency (above-code) program is considered in compliance;
A building inspected by a code-certified inspector (warranty inspection) is considered in compliance; otherwise,
A builder may self-certify a building with a form to be provided by ESL.	

- A building inspected by a code-certified inspector (warranty inspection) is considered in compliance; otherwise,
- A builder may self-certify a building with a form to be provided by ESL.

- Outside of Municipal Jurisdictions

## is responsible for evaluating the energy savings impacts and related emission reductions of building energy efficiency provisions;
is responsible for making code implementation materials available to building community;
provides training and technical assistance.

- is responsible for making code implementation materials available to building community;
- provides training and technical assistance.

- Energy Systems Laboratory of Texas A&M System

## What Is Role of Non-Attainment and Affected Counties in Texas?

- 70% of state’s population
- 76.4% of aggregate employment
- 83.4% of personal income
- 83% of Gross State Product
- 85% of Texas manufacturing activity

- Data Source:  The Perryman Group.  *The Importance of Maintaining A Proper State Implementation Plan (SIP) to Address Air Quality Issues in Texas: An Economic and Fiscal Impact Assessment.* November 2002.

## What’s the Cost of Failure? Health Effects (on Business)

- “Low” Scenario
- $6.3 billion in Total Expenditures
- $3.2 billion in Gross Product
- $2.2 billion in Personal Income
- 56,356 Permanent Jobs
- $157.4 million in State Revenue

- “High” Scenario
- $13.7 billion in Total Expenditures
- $7.0 billion in Gross Product
- $4.8 billion in Personal Income
- 123,763 permanent Jobs
- $345 million in State Revenue

- Data Source:  The Perryman Group.  *The Importance of Maintaining A Proper State Implementation Plan (SIP) to Address Air Quality Issues in Texas: An Economic and Fiscal Impact Assessment.* November 2002.

## What’s the Cost of Failure? Expansion Restrictions (10 yr.)

- Direct only
- $438.4 billion in Total Expenditures
- $150.2 billion in Gross Product
- $84.2 billion in Personal Income
- 1,758,847 Permanent Jobs
- $7.2 billion in State Revenue

- Including other sectors
- $586.6 billion in Total Expenditures
- $219 billion in Gross Product
- $126.8 billion in Personal Income
- 2,7514,02 Permanent Jobs
- $10.6 billion in State Revenue

- Data Source:  The Perryman Group.  *The Importance of Maintaining A Proper State Implementation Plan (SIP) to Address Air Quality Issues in Texas: An Economic and Fiscal Impact Assessment.* November 2002.

## What’s the Cost of Failure?Lost Highway funds (1 yr.)

- During Construction
- $3.6 billion in Total Expenditures
- $1.7 billion in Gross Product
- $1.1 billion in Personal Income
- 27,122 Person-years of Employment
- $88.6 million in State Revenue

- After Construction
- $464.3 million in Total Expenditures
- $238.3 million in Gross Product
- $145 million in Personal Income
- 4,830 Permanent Jobs
- $13.1 million in State Revenue

- Data Source:  The Perryman Group.  *The Importance of Maintaining A Proper State Implementation Plan (SIP) to Address Air Quality Issues in Texas: An Economic and Fiscal Impact Assessment.* November 2002.

## Costs: 10 Year Simulation

- “Low” Scenario
- NPV of State Revenues$23.993 billion
- Benefit /Cost ratio: 63.8 to 1

- “High” Scenario
- NPV of State Revenues $35.667 billion
- Benefit /Cost ratio: 94.9 to 1

- Data Source:  The Perryman Group.  *The Importance of Maintaining A Proper State Implementation Plan (SIP) to Address Air Quality Issues in Texas: An Economic and Fiscal Impact Assessment.* November 2002.

## Once Adopted, What Did You Do To Implement and Enforce?

- The role of the Energy Systems Laboratory is to help people be successful in saving energy – and then measure results
- Failure of funding required focus on a few basic areas initially:
- Answer the phone (and email)
- Compliance training for builders and designers (Spec. Project)
- Enforcement training for code officials
- Next: data collection, continuous training, continuous improvement